NEW YORK (AP) — AT&T Inc., the largest telecommunications company in the U.S., reports fourth-quarter results Thursday before the stock market opens.
WHAT TO WATCH FOR: There's every indication that the last three months of 2011 were a blowout quarter for smartphone sales in the U.S., with the launch of the iPhone 4S at no less than three carriers. Verizon has said it activated 4.3 million iPhones in the quarter.
That's the fourth quarter of iPhone activations for Verizon, while AT&T has been in the game since 2007. In the first three quarters of last year, it managed to beat the newcomer every time. This time it's possible that Verizon won, given that it more than doubled the number of iPhones it activated.
In a broader sense Verizon and AT&T are competing for high-paying phone subscribers: those who will buy a smartphone and sign a two-year contract. Verizon has topped AT&T in that field since it got the iPhone, and the pattern looks set to continue in the recent quarter. Verizon added 1.2 million subscribers under contract, while analysts expect AT&T got about half a million.
AT&T is picking up the pieces after its $39 billion bid to buy No. 4 carrier T-Mobile USA was derailed by regulators on antitrust grounds. On the conference call after the earnings report, analysts will be listening for word of AT&T's "Plan B." It's on the prowl for more spectrum, so it can increase its wireless data capacity, and might be interested in other acquisitions.
AT&T started selling the first phones that can use its new "LTE" wireless data network in the fourth quarter, and executives may give some indication of how that network is doing. AT&T trails Verizon by a bit less than a year in its LTE buildout.
This week, AT&T revamped its data plan pricing plans, providing more data at every tier for higher monthly fees. That won't affect the results they report Thursday, but executives might explain the reasoning behind the change.
WHY IT MATTERS: Dallas-based AT&T had 100.7 million wireless devices connected to its network and 40.1 million landlines at the end of the last quarter. AT&T is a component of the Dow Jones industrial average.
WHAT'S EXPECTED: Analysts polled by FactSet expect earnings of 43 cents per share on revenue of $31.98 billion.
LAST YEAR'S QUARTER: AT&T earned 18 cents per share. That was held back by adjustments in the value of its pension and health care plans for retirees. Excluding one-time effects, earnings were 55 cents. Revenue was $31.4 billion.
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