AT&T;'s Profit Nearly Triples

L.A. Times Archives

July 21, 2005 12 AM PT

From Reuters

AT&T; Corp., which has agreed to be acquired by SBC Communications Inc. for $16 billion, said Wednesday that its second-quarter earnings nearly tripled because of cost cutting.

AT&T;, the largest U.S. provider of business telecommunications services, said it had earned $307 million, or 38 cents a share, compared with $108 million, or 14 cents, a year earlier.

Excluding one-time charges from the SBC deal, a debt buyback and restructuring, AT&T; said it had earned 62 cents a share. Analysts on average had estimated that AT&T; would earn 53 cents a share, according to Reuters Estimates.

Revenue fell 11% to $6.76 billion because of price cuts in business services and the company’s decision to stop competing for residential customers. AT&T; said 2005 sales could total about $26 billion, equal to or slightly more than its prior forecast.

Revenue in AT&T;’s key business services unit fell 8% to $5.2 billion. Its consumer unit posted a 21% drop in revenue to $1.6 billion.

Shares of AT&T; closed up 3 cents at $19.15.