Verizon, AT&T shrug off economic turmoil with impressive Q1 results

By Giselle Abramovich

April 29, 2008

Talking the talking, walking the walk

Telecoms giant Verizon recorded rapid growth in its wireless business, driving the company's revenue up 13 percent in the first quarter of this year.

However, Verizon’s impressive results are no match to competitor AT&T Inc., which has posted a larger growth in wireless than Verizon in the last two quarters. AT&T saw an 18.3 percent increase in wireless revenues in the first quarter of this year. AT&T’s wireless data revenues from areas such as Internet access, messaging and media bundles went up 57.3 percent.

“In wireless, we are changing the game with our open development initiative, our plans for next-generation technology deployment and our strategic investment in spectrum for nationwide broadband services,” said Ivan Seidenberg, chairman/CEO of Verizon, at the companies investor conference call.

Verizon also added 1.5 million subscribers, beating AT&T, which added 1.3 million.

Of Verizon’s 1.5 million total net customer additions, 1.3 million were retail post-paid customers.

Verizon customers sent or received more than 58 billion text messages and 1.1 billion picture or video messages. Customers also completed 34.6 million music and video downloads.

Verizon attributes its success this past quarter to its wireless business.

AT&T said its revenue growth was driven by strong subscriber gains and continued improvement in average monthly revenues per subscriber. Note that AT&T has now posted seven consecutive quarters of year-over-year growth in wireless service ARPU.

Both carriers have shown little sign of trouble during a slowing economy, which could even mean that the mobile industry as a whole is shrugging off recession.

"AT&T's goal is to innovate and lead in a communications world driven by mobility and interactivity," said Randall Stephenson, AT&T chairman/CEO, during the first-quarter earnings investor call.

"To that end, as we deliver strong earnings and return substantial value to shareowners, we are also taking important steps to expand our networks and product sets to drive continued growth in wireless, broadband and IP-based services,” he said.