(Reuters) – AT&T gained more wireless subscribers than expected inside the third quarter, driven by the regular adoption of its higher-tier unlimited plans that include perks including increased hotspot data.
The U.S. telecom firm said on Wednesday it had added 403,000 net monthly bill-paying wireless phone subscribers inside the July-September period, above Visible Alpha estimates of 393,430 additions.
Premium plans have helped AT&T stay competitive inside the saturating U.S. telecom market where rivals Verizon and T-Mobile are bundling their offerings with streaming services harking back to Netflix and Max to attract customers.
Demand has also been growing for AT&T’s convergence plans that allow customers to combine its high-speed fiber data with its wireless phone service. The company said 40% of shoppers that use fiber also go for its wireless plans.
To sharpen give attention to its foremost business, AT&T agreed last month to sell its entire 70% stake in satellite TV provider DirecTV to private equity firm TPG for $7.6 billion, exiting from a costly foray into the media business.
Postpaid phone churn, or the variety of shoppers canceling AT&T’s service monthly, was 0.78% inside the third quarter, helped by the company’s smartphone plans that offer recent and existing customers the an identical promotions.
But revenue of $30.2 billion missed estimates of $30.44 billion, based on data compiled by LSEG, as the company’s mobility equipment revenue took a hit from lower phone upgrade volumes.
Rival Verizon also reported a quarterly revenue miss on Tuesday attributable to the lull in phone upgrades.
AT&T’s fiber business added 226,000 customers, missing expectations of 257,860 additions, based on Visible Alpha. This was mainly driven by a chunk stoppage that began in August in its southeast region and impacted fiber installations.
Free money flow, which helps investors determine dividend sustainability, came in at $5.1 billion, above Visible Alpha estimates of $4.7 billion.
(Reporting by Harshita Mary Varghese in Bengaluru; Editing by Devika Syamnath)