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AT&T sees fewer new customers in third quarter

Limited supply of iPhone 5 hurts subscriber growth; revenue remains flat compared with last year.

Updated: 2012-10-25T04:16:07Z

The New York Times

AT&T said Wednesday that subscriber growth in the latest quarter was stifled by a limited supply of the iPhone 5, but that sales of smartphones and mobile data plans remained strong.

The company reported that third-quarter earnings were essentially flat at $3.64 billion, or 63 cents a share, compared with earnings of $3.62 billion in the period a year earlier. Revenue also was flat at $31.46 billion.

“We had another impressive quarter with strong earnings growth, record cash flows and solid returns to shareholders through dividends and share buybacks,” said Randall L. Stephenson, AT&T’s chief executive.

AT&T, based in Dallas, said it sold 6.1 million smartphones in the quarter and activated 4.7 million iPhones. The company said it added 151,000 contract subscribers, the most valuable type of customer, compared with 319,000 in the period a year earlier. AT&T said contract subscriptions were held back partly because of the limited supply for Apple’s iPhone 5, which has been selling out quickly in stores since its release last month.

Revenue from mobile data services grew 18.3 percent, to $6.6 billion, compared with the third quarter of 2011.

“For years, Verizon and AT&T have performed a nearly impossible feat; both companies have consistently and significantly outperformed an industry of which they already represented the overwhelming share,” said Sanford Bernstein analyst Craig Moffett. “Simple math says that can’t be sustained forever … Verizon Wireless is still outperforming industry metrics. But AT&T isn’t anymore.”

The Associated Press contributed to this report.

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