By The Associated Press
NEW YORK, N.Y. – AT&T Inc., the largest telecommunications company in the U.S., reports second-quarter results Tuesday before the stock market opens. Its biggest nemesis, Verizon Wireless, reported strong results Thursday.
WHAT TO WATCH FOR: The quarter has lacked major drama for AT&T. Investors are still wondering if AT&T will be able to curb its outlays for iPhones, which it sells heavily subsidized, but the true test of that will come later this year, when Apple releases a new model.
AT&T announced this week that it would join Verizon in introducing radical new plans that let up to ten devices share a pool of data. The AT&T plan will become available in August, and the company is heading into the new era more cautiously than Verizon, which abolished nearly all of its traditional phone plans when introducing Share Everything.
For the second quarter, analysts expect AT&T to report adding a net of about 200,000 subscribers on contract-based plans, which carry the highest monthly fees. That compares with Verizon’s gain of 888,000.
Union contracts for 40,000 workers on AT&T’s landline side have expired. They’ve voted to authorize strikes, but they’ve remained on the job as the parties continue to negotiate. AT&T is trying to get them to shoulder more of their health care costs.
Some analysts look at the iPhone sales reported by AT&T and Verizon in an attempt to divine Apple’s overall iPhone sales ahead of Apple’s own report, which lands on Tuesday afternoon. However, the iPhone’s global distribution means that sales at U.S. carriers are no longer very important. In the first quarter, U.S. carriers accounted for a quarter of overall iPhone sales.
WHY IT MATTERS: Dallas-based AT&T had 103.9 million wireless devices connected to its network and 38 million landlines at the end of the last quarter. The stock is a component of the Dow Jones industrial average.
WHAT’S EXPECTED: Analysts polled by FactSet expect earnings of 63 cents per share on revenue of $31.7 billion.
LAST YEAR’S QUARTER: AT&T earned 60 cents per share on revenue of $31.5 billion.