AT&T Inc. on Tuesday posted the best profitability ever in its wireless arm, paradoxically because it sold fewer smartphones.
The largest telecommunications company in the U.S. said its subscribers are now holding on to their phones longer:
The rate of upgrades to new phones was at a record low in the second quarter. That’s good news for the company because it to subsidizes each smartphone by hundreds of dollars to be able to sell it to customers for $99 or $199. In March last year, AT&T started telling subscribers that they had to stay on contract for 20 months before they would be eligible for a new phone at the fully subsidized price.
Before that, some high-paying customers had been eligible for upgrades after just 12 months.
AT&T activated 5.1 million smartphones in its latest quarter, down from 5.5 million in the same period a year ago.
That helped boost wireless operating income by 18 percent in the quarter, to $4.9 billion.Olympian news services