AT&T reported third-quarter revenues up nearly 19 percent year-on-year to USD 39.1 billion, driven by its acquisition of DirecTV. Adjusted operating profit rose to USD 7.9 billion versus USD 5.9 billion a year ago, and the margin rose 250 basis points to 20.3 percent. One-time costs for the takeover and decommissioning of the former Leap network led to a drop in earnings, to USD 0.50 per share from USD 0.60 a year ago. Adjusted EPS, excluding the extra costs, rose almost 14 percent to USD 0.74. AT&T raised its outlook for full-year adjusted EPS to USD 2.68-2.74 and also increased its free cash flow target to at least USD 15 billion, after generating USD 5.5 billion in Q3 alone.
At its consumer mobile division, AT&T saw postpaid net customer additions slow to 23,000 in the quarter, and no new connected devices were added. Prepaid additions reached 466,000 in the three months, and resellers added 149,000 SIMs. Total consumer mobile connections fell to 54.845 million from 56.098 million a year ago. Churn was up from Q2, to 1.90 percent from 1.86.
AT&T's new breakdown of mobile results shows its growth is largely coming in the business market, where it added 1.875 million mobile connections in Q3. Churn there was 1.05 percent, and the total customer base reached 71.561 million at the end of September, up from 62.552 million a year earlier. Consumer and business combined, AT&T Mobility reported mobile service ARPU of USD 40.19 for the quarter, down from USD 41.07 in Q2.
At its Entertainment and Internet Services division, AT&T reported a net loss of 106,000 fixed broadband customers in the quarter, for a total 14.322 million. DSL customers fell by 278,000, while U-verse services grew by just 172,000 broadband subscribers. In the TV market, DirecTV added 26,000 customers, while U-verse shed 92,000 subscribers, for a total base of 25.424 million at the end of the period. ARPU was still higher for both broadband and TV services, at respectively USD 46.48 and USD 114.40.
