At AT&T, cost-cutting lifts earnings; but revenue growth remains lackluster
Article Abstract:
AT&T reports a 68 percent increase in earnings for 3rd qtr 1998, to $1.96 billion, or $1.09 a diluted share, compared with $1.16 billion, or 65 cents a share, in the same period in 1997. Cost-cutting is cited as a reason for the strong earnings, but the company's revenue figures were less impressive. Revenue appeared to grow at 4.3 percent, the fastest rate in two years, increasing to $13.7 billion from $13.1 billion. However, part of that gain resulted from a one-time jump in sales. As part of a Federal plan to subsidize services in poor and rural areas, AT&T began charging a flat monthly fee to residential customers, but this fee is not likely to increase in the future and therefore will not contribute to continued growth. Chmn C. Michael Armstrong says growth of at least 6 percent a year is wanted.
Publication Name: The New York Times
Subject: Business, general
ISSN: 0362-4331
Year: 1998
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AT&T plan is a search for loyalty
Article Abstract:
Sprint Corp. and MCI Worldcom are likely to offer similar services soon, as profit margins continue to thin for US phone providers to the domestic market. AT&T may have a further advantage in its acquisition of cable provider Tele-Communications Inc., because it would be able to link premium CATV services with use of phone services (make calls, get HBO free). The cellular market doesn't yet have a provider that blankets the US, so these companies may push to consolidate metropolitan and regional cell co.'s into a national network. Long distance and local phone companies, CATV, and possibly even Internet service providers all seek to offer one communications package to consumers.
Publication Name: The New York Times
Subject: Business, general
ISSN: 0362-4331
Year: 1999
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