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AT&T activates 1.6m iPhones in Q1 2009

updated 08:25 am EDT, Wed April 22, 2009

ATT Q1 2009 Results

AT&T this morning posted results for the first calendar quarter of 2009 that it attributed significantly to its performance with the iPhone. The company had a net gain of 1.2 million new cellphone subscribers but says that it activated 1.6 million iPhone 3G devices, suggesting that the users of Apple's handset are offsetting potential losses at the carrier. AT&T also credits the iPhone for preventing a slide in the company's wireless operating income margin, which has been kept high at 40.9 percent, and for more than doubling the number of smartphones on the network in the past year: about 31.7 percent of the 61 million subscription phones are in the smartphone class.

About 875,000 of new subscriber adds were from retail, a 24.1 percent bump year-over-year. AT&T now claims a total of 78.2 million cellular users of any kind on its network.

Besides immediate income, other factors are also partly influenced by the iPhone. AT&T's wireless data revenue has spiked 38.6 percent year-over-year to top $3.2 billion; it now represents 27.2 percent of all of the provider's wireless revenue. The average revenue per user, or the amount spent by typical customers per month, has also climbed slightly to $59.21 in spite of economic concerns.

AT&T continues to note that iPhone owners tend to spend an average of about 1.6 times more per month than other subscription users and are less likely to defect, with many customers actively switching for the device. About 40 percent of those buying iPhones are new to AT&T, the company says.

Business for the firm as a whole was ultimately down from early 2008 and dropped its net income from $3.5 billion to $3.1 billion. However, AT&T chief Randall Stephenson argues that the iPhone ultimately softened its decline in a "tough economy" and that there is "substantial" room for growth in the future.

"I am particularly pleased with the success of our iPhone 3G initiative, which has driven strong high-end customer growth and delivered financial benefits ahead of our original outlook," he says.

The figures represent a continued decline for US iPhone sales but suggest a relatively soft drop-off in the wake of the holidays. Apple's handset sold 1.9 million units in the fall quarter and indicates that demand hasn't trailed significantly. However, it also provides an early preview of Apple's own results for the March quarter, due late this afternoon, and indicates that Apple may sell less than the 4.36 million iPhones it managed at the end of 2008.

by MacNN Staff



  1. snork

    Joined: Dec 1969


    Plus 1 Defector

    Well I can be included in the tally as a VZW defector for the iPhone last quarter. I loved VZW service, but after waiting 2-3 yrs for any sort of decent phone (WinMo phones included) I finally bailed for an iPhone from my LG Dare. The Dare was a great "phone" but it did nothing else well.

  1. testudo

    Joined: Dec 1969


    bad suggestion

    The company had a net gain of 1.2 million new cellphone subscribers but says that it activated 1.6 million iPhone 3G devices, suggesting that the users of Apple's handset are offsetting potential losses at the carrier.

    Who's doing the suggesting, ATT or MacNN?

    Without ATT actually saying how many of its iPhone customers were new to ATT, that's way too big of a leap. Without any other information, you have no idea how many iPhone owners are switching from another ATT phone vs how many are switching carriers.

    Even the number is meaningless in terms of 'new' iPhone users, as no one is saying how many of those 1.6 million are new to the iPhone or just upgrading from a previous version.

  1. testudo

    Joined: Dec 1969



    And did you see their margins on smartphone plans?

    And when do sales plummet due to everyone waiting for iPhone 3.0? I thought that was supposed to have started in right after MWSF?

  1. rytc

    Joined: Dec 1969



    It says that 40% of the 1.6 million were new to At&T, this means ~700,000 of those new users or close to 60% are due to people switching to the iPhone - that's pretty significant.And it's all in the article.

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