AT&T; Profit Rises 1.3% as Revenue Drops 0.3%

American Telephone & Telegraph said Wednesday that its second-quarter profit rose 1.3% on a 0.3% decline in revenue from a year ago.

In Washington, MCI Communications, one of AT&T;'s major long- distance competitors, reported a slight gain in net income to $34.3 million from $33 million a year ago.

AT&T;, headquartered in New York, said its net income for the three months ended June 30 totaled $461 million, compared to $455 million for the same period a year earlier.

Revenue, after deducting access charges paid to the local telephone companies, dropped to $8.55 billion from $8.58 billion.

"We are taking those steps we need to take to build an improving performance record over the long pull, notwithstanding the difficult challenges we face in achieving our current financial goals," AT&T; Chairman Charles L. Brown said.

"Our objective is to stake out a sustainable leadership position in the business of information movement and management, and that's the focus of our strategies," Brown said.

During the latest quarter, the company introduced new business computer products, sales of personal computers continued to grow despite a slumping market and the company won a federal government contract with a potential value of nearly $1 billion, Brown said.

MCI said revenue rose to $601.2 million for the quarter ended June 30, compared to revenue of $484.8 million last year.

Included in the latest quarter is $30 million representing the cash payment portion of an antitrust settlement with Bell Atlantic.

A company spokesman said revenue was reduced by delays of local phone company conversion of some customers to MCI service.

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