Grant Gross
Senior Writer

AT&T net income up, on lower revenue

news
Jul 20, 20052 mins

Declines felt in long distance and data revenue

AT&T Wednesday reported a net income of $307 million for the second quarter of 2005, up from $108 million during the second quarter of 2004.

AT&T, as it moves toward a merger with SBC Communications, reported consolidated revenue of $6.8 billion for the quarter, a decline of 11.5 percent from 2004’s second quarter. Declines in long distance and data revenue contributed to the lower numbers, the company said in a press release.

The company posted earnings per diluted share of $0.38 for the quarter, which ended June 30. Excluding one-time charges of $0.24 for debt repurchases, merger costs, and facility closings, AT&T’s earnings per share was $0.62, while analysts expected earnings per share of $0.53, according to Thomson First Call.

AT&T’s quarterly results show the company is managing costs and strengthening its competition with enterprise customers, David Dorman, company chairman and chief executive officer, said in a statement.

AT&T’s consolidated revenue included $5.2 billion from AT&T Business and $1.6 billion from AT&T Consumer. AT&T Business revenue dropped 8.1 percent from the second quarter of 2004, due primarily to pricing competition in traditional voice and data services, company officials said. Those declines were partially offset by increases in IP (Internet Protocol) and e-services, including AT&T VPN (virtual private network) and IP-enabled frame relay services, said Thomas Horton, chief financial officer.

Revenue in AT&T’s consumer division declined 20.8 percent from a year ago, due to competition from other telecom carriers, wireless services and IP voice, officials said. In July, the company stopped its efforts to market residential customers nationwide, and some of the declines were expected, company officials said.

The company ended June with about 41,500 employees, down 13 percent from the beginning of the year, Horton said.

Grant Gross

Grant Gross, a senior writer at CIO, is a long-time IT journalist who has focused on AI, enterprise technology, and tech policy. He previously served as Washington, D.C., correspondent and later senior editor at IDG News Service. Earlier in his career, he was managing editor at Linux.com and news editor at tech careers site Techies.com. As a tech policy expert, he has appeared on C-SPAN and the giant NTN24 Spanish-language cable news network. In the distant past, he worked as a reporter and editor at newspapers in Minnesota and the Dakotas. A finalist for Best Range of Work by a Single Author for both the Eddie Awards and the Neal Awards, Grant was recently recognized with an ASBPE Regional Silver award for his article “Agentic AI: Decisive, operational AI arrives in business.”

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