SBC revenues slip, company reaffirms guidance

SBC Communications today reported third-quarter revenues of $12.8 billion, down from $13.5 billion from the year-ago quarter and $13.1 billion for the second quarter. Net earnings for the quarter came in at $1.8 billion.

On a per-share basis, the company ended the quarter with earnings of 53 cents per diluted share, compared with 61 cents per diluted share in the third quarter of 2001.

Highlighting the quarter was the addition of 226,000 DSL subscribers. The company also passed the 2 million subscriber mark for DSL in mid-October. On the long-distance side, the company added 318,000 lines in the third quarter, increasing its total to 5.9 million. Long-distance revenue, however, fell 7.6%.

Going forward, the company said it is confident it will meet its earnings-per-share goal of $2.26 for 2002.

In his quarterly conference call with analysts, SBC Chairman and CEO Ed Whitacre used the earnings announcement as another opportunity to rail against what he sees as unfair regulatory rules. Citing the company’s loss of 751,000 access lines in the quarter, Whitacre said the vast majority of that was from competitors using the unbundled network element platform (UNE-P) rules to sell local service.

More than 80% of that 751,000-line loss this quarter came from the five states where UNE-P prices are the lowest.

“We have now lost 4.9 million retail lines to UNE-P,” he told analysts. “No amount of cost control or cost cutting will offset it.”