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 Send to email | AT&T: New 3G iPhone Will Whack Our Earnings, Margins (T, AAPL) in TEPS |  By Silicon
el 09-Jun-2008 |
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 In a lengthy press release, AT&T (T) boasts about its status as the exclusive carrier for the new Apple iPhone 3G, talks up its cool new features, and then... drops the other shoe: Subsidizing that phone by $199 will lower margins and earnings. From the release:
The company anticipates potential dilution to earnings per share (EPS) from this initiative in the $0.10 to $0.12 range this year and next, with a 2008 adjusted consolidated operating income margin of approximately 24 percent and a full-year 2008 wireless OIBDA margin in the 39-40 percent range. As recurring revenue streams build without any further revenue sharing required, AT&T expects the initiative to turn accretive in 2010.
The good news: That earnings hit is pretty minor. Consensus EPS for FY 08 is $3.12. And given that AT&T is no longer sharing any of its service revenue with Apple -- and will be charging more for its service -- it obviously feels this is a safe bet.
AT&T will again offer iPhone calling plans beginning at $39.99 per month for 3G subscribers, but as we predicted, the carrier will charge $30 a month -- $10 more than it does now -- for 3G data access.
See Also:
Apple's New iPhone Strategy: More Units, Less Revenue
Apple 3G iPhone Launch Date Frustrates Fans, Investors (Who Sell On The News)
Apple's iPhone 2.0: $199, 3G, On Sale July 11
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| RIM has its head in the sand and is delusional.. |  Analysts had a field day on Friday after RIM released its less than stellar Q2 earnings on Thursday. When addressing its future prospects, RIM warned that its gross margins in the Q3 will drop another three percentage points to 47% and that a further decline is likely into 2010. Ouch! In a letter sent to [...] [..] Read complete article | | Published 27-Sep-2008 by Kelly Hodgkins in BlackBerryNewsRIMearningsRIMMstocks
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 | Nerdblog |  Blogger | Provides news about hardware, software, notebooks, laptops, PCs, Mac, PDAs
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| Nerdblog | Blogger | Provides news about hardware, software, notebooks, laptops, PCs, Mac, PDAs
Nerdblog.Net |
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