Cingular reports record subscriber growth

Cingular made a good start in its transition to the AT&T name in the fourth quarter, adding 2.4 million net subscribers, a quarterly record not only for the company but for any carrier in the U.S. To top off the operational gains, Cingular nearly quadrupled its Q4 profits and boosted its quarterly revenues 10% year-over-year.

Cingular now has 61 million subscribers, giving it a significant gain over Verizon Wireless, which reported 56.7 million customers in the third quarter. While Verizon Wireless is likely to gain a big boost from the same holiday sales period when it reports earnings this week, the operator has so far failed to overtake Cingular in the two years since it acquired AT&T Wireless.

Cingular’s revenues came in at $9.8 billion for the fourth quarter, and it recorded earnings of $782 million, an increase of 283% over the fourth quarter of 2005. Cingular reported an overall churn rate of 1.8% and postpaid churn rate of 1.5%, both improvements over last year’s figures. Cingular’s Q4 monthly ARPU increased 43 cents to $49.29 year-over-year but it dipped slightly from the previous quarter, when it was $49.76. Data ARPU, however jumped both sequentially by 14% and year-over-year by 53% to $7.19.

At Cingular’s earnings call, CEO Stan Sigman said that reducing churn and selling data services have been key to increasing Cingular’s profits, a trend that the renamed company plans to execute further on in 2007 as its 3G rollout nears completion and new innovative products like Apple’s iPhone drive people to the data network.

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