The headline numbers for those results that came out this week, kicking off the quarterlies, were mostly good news with the underlying numbers at AT&T showing no surprises and down at the chip level, Broadcom’s numbers underlining that trend. So far no recession, but the future is still scary.
Wireless adds at AT&T were 2 million, most of them postpaid taking total subscribers to 74.9 million, and there were 2.4 million iPhone 3G devices activated in the quarter. In IPTV AT&T added 232,000 new customers to reach 781,000 in service, on track for that magical 1 million subs by year end.
What with no lull in these two main new areas, which are both consumer spending driven, that pretty much set the scene for the results. The total number of fixed line accounts fell from 49.6 million a year ago, to 47.5 million, down 900,000 from the last quarter. Broadband subscribers jumped 148,000 to 14.8 million, which is definitely slowing since it was up 1.1 million over the whole year closer to a 275,000 average.
AT&T revenues rose 4% to $31.3 billion, and net income $3.2 billion, up a fraction from $3.1 billion a year-earlier, although operating income was down.
All of that should have calmed the markets and AT&T did not revise its guidance and it had the most net adds or wireless in its history, so it was tough to take the news negatively, so naturally AT&T stock went down.
At Broadcom, a company that provides components into many of the markets where AT&T provides operator services, had third quarter revenue rise 8.1% sequentially and 37% year on year to $1.298 billion.
Net income was $164.9 million, up on the second quarter but massively up on the $27.8 million from a year ago. The company reports record revenue and cash flow and it boasted a rapid transition to 65nm process technology and put itself in good health to ride out any recession. Still no sign of recession, but some discussion about it.