AT&T Revenue Rises Due To DirecTV Acquisition

The first-quarter EPS of Telecom giant AT&T is said to have risen by 10%. This has resulted in the revenue boost of the company by about 24%. According to the reports, the increase in the EPS and the revenue has been due to the acquisition of the satellite television service DirecTV last year.

AT&T would issue the details of the revenue improvement post the market close on Tuesday. In the opinion of analysts in the market, the rise in the AT&T revenue is quite similar to the same of Verizon Communications (VZ). They add the recent upgrades and updates that the company issued for new mobile phones would further affect AT&T’s revenue. The experts also noted that the new trend will result in the improvement of wireless profit margins. However, it will pose a threat to the equipment revenue.

While AT&T made improvements in its profit share, Verizon and AQL admitted that their profit share fell in the last quarter. Meanwhile, an analyst at William Blair said that one of the reasons for the improvements in the AT&T revenue is the growth in the smartphone industry. An increasing number of people are watching entertainment programs now on their smartphones. AT&T’s DirecTV select package and similar deals are offered through smartphone applications across all the mobile platforms.

Similarly, AT&T offers special internet packages to the smartphone users in the country. Latest report indicates that analysts are now waiting for the release of latest information about AT&T’s achievements in the sale of various services such as bundle internet offers, wireless, video services, etc. In addition to that, the introduction of operating synergies with DirecTV has helped AT&T to boost its revenue scale. Moreover, AT&T has been taking efforts to renegotiate programming contracts with various firms as part of its efforts to cut down per-subscriber costs.

In the first quarter of 2015, AT&T had its major source of revenue through DirecTV. DirecTV offers numerous deals such as DirecTV select package, family package, sport package, etc. As per the reports, about 60,000 people subscribed to DirecTV deals during the period. Furthermore, during that quarter, AT&T managed to add about 331,000 post-paid wireless subscribers into its customer base. These new subscribers are billed on monthly basis.

Meanwhile, the report indicates that AT&T lost about 256,000 post-paid phone lines during the same period. However, it hasn’t really affected the revenue of the company as it has been made up by the addition of new DirecTV subscribers.