U.S. telecommunications giant AT&T released its results for the fiscal first quarter of 2013 this afternoon, posting earnings per share of $0.64 on revenue of $31.4 billion.
Analysts were expecting the Dallas, Texas-based company to report first quarter earnings of 64 cents per share on revenue of $31.746 billion.
That's a match and a small miss, for those keeping track at home. The company's shares were down 2.05 percent, to 38.20, in after-hours trading.
The story here is that AT&T's profit, wireless revenue and wireless subscribers continue to grow as more people switch to lucrative smartphones. But the company—the second-largest wireless carrier in the U.S., behind Verizon—is engaged in a losing battle with its rival for the top of the market, even as it widens the gap between it and its smaller rivals.
The company enjoyed more than two million new high-speed IP broadband connections (wireless and wireline).
Wireless data revenues were up 21 percent versus the year-earlier period.
Total wireless revenues and wireless service revenues were both up 3.4 percent versus the year-ago quarter.
The company says it enjoyed "record first-quarter smartphone sales"—6.0 million, in fact. (Verizon's Q1: 7.2 million.) That's a big deal because average revenue per user for smartphones is about twice that of non-smartphone subscribers.
The company saw 296,000 wireless postpaid net adds (postpaid "churn"—the industry term for when customers leave—improved to 1.04 percent, from 1.19 percent in 4Q12 and 1.1 percent in 1Q12) and 1.2 million new smartphone subscribers. (Verizon's Q1: 677,000 net adds.) Smartphones represent 88 percent of AT&T's postpaid phone sales.
Postpaid data average revenue per user was up 18 percent; postpaid phone-only subscriber average revenue per user, however, was only up two percent.
AT&T had 4.8 million iPhone activations during the quarter. (Verizon's Q1: 4 million.)
Wireline ("U-verse") consumer revenue grew two percent versus the year-earlier period. Total revenues for this, including the business segment, were up 31.5 percent year over year.
AT&T now has 8.7 million U-verse subscribers. (That includes TV and high-speed Internet.) It added 731,000 high-speed Internet subscribers during the quarter, its best ever, and 232,000 (net) TV subscribers, its best showing in nine quarters.
Finally, the company posted its best total broadband net adds in two years.
"Overall, smartphones now make up more than 70 percent of our postpaid phone base, and smartphones accounted for nearly 90 percent of postpaid sales in the quarter, giving us even more room for smartphone growth," chief financial officer John Stephens said during an earnings-related conference call. "These are the premium subscribers in our business. They have twice the ARPU of non-smartphone subscribers and much lower churn. So their conversion brings additional revenue."
AT&T didn't provide any guidance for the second quarter, but analysts are looking for earnings of 71 cents per share on revenue of $31.9 billion.