AT&T Sees Record Third-Quarter Smartphone Sales

   By John Kell 
 

AT&T Inc. (T) expects to report record third-quarter smartphone sales next month, as well as stronger upgrades from year-ago levels, but sees a slowdown in upgrades in the final quarter of the year.

AT&T said while it sees higher smartphone upgrades in the current quarter from year-ago levels, that metric will be lower in the fourth quarter, due to AT&T's new 24-month upgrade policy and given higher upgrade expectations for the third quarter. The telecommunication giant also expects to grow its smartphone base by more than one million in the third quarter.

AT&T, which left its full-year guidance unchanged, is expected to report third-quarter results on Oct. 23. Analysts surveyed by Thomson Reuters most recently expected AT&T to report a 7% jump in profit on a 2% increase in revenue for the third quarter.

The rosy commentary comes as AT&T and Verizon Wireless--a joint venture of Verizon Communications Inc. (VZ) and Vodafone Group PLC (VOD, VOD.LN)--have recently unveiled plans that bill subscribers for the full price of their phones, which are broken into monthly payments.

The change allows consumers to upgrade to new devices at a faster pace, and shifts from the hefty subsidies AT&T and Verizon offer for smartphones purchased with traditional contracts.

On Friday, AT&T also disclosed that it closed on its roughly $780 million acquisition of Atlantic Tele-Network Inc.'s (ATNI) retail wireless operations. AT&T also said it was exploring options to monetize some or all of the wireless tower assets it owns.

Write to John Kell at [e-mail]

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