By the end of 2008, AT&T's U-Verse service will top 1 million homes.
Simply put, AT&T plans on a big IPTV roll-out over the next two years. Couple AT&T's move with Verizon's FiOS service and there's a lot more competition coming to cable providers. The U-verse roll-out, however, won't come cheap--AT&T expects the deployment to take a 12 cents a share to 14 cents a share chunk out of 2008 earnings.
But overall AT&T's outlook was positive for 2008. By the numbers:
- AT&T projects wireless revenue growth in the "midteens." Enterprise revenue will be positive.
- Revenue growth overall will be in the mid-single digit range with earnings per share growing at a double digit clip.
- Operating income margin of about 25 percent to 26 percent, up from 23 percent to 24 percent in 2007.
- AT&T upped its dividend by 12.7 percent from 35 cents a share to 40 cents a share quarterly. The company is also buying back 400 million shares.
Longer term, AT&T projected revenue from Yellowpages.com and content advertising to hit $1.5 billion in 2010, up from $600 million in 2007. Meanwhile, AT&T expects cost savings from the AT&T-BellSouth merger to double over the next three years to $7 billion.