By Allen Tsai | Mon Feb 01, 2010 5:10 am |
AT&T reported a 26 percent rise in quarterly profit, spearheaded by data-hungry iPhone users, and detailed plans to beef up its network in preparation for Apple's new iPad device.
The strong sales pushed revenue up 9.2 percent to $12.6 billion for an overall profit of $3 billion -- up 25.6 percent from a year ago.
The company also said it plans to spend twice as much -- about $2 billion -- putting in new radio boxes, building more cell towers, and adding new sites in high-density areas like transportation hubs.
"We expect improvements in both markets in the coming months," said John Stankey, AT&T's chief executive officer for operations. "In Manhattan in particular, capacity will increase by a third by the end of the quarter."
Last year, AT&T added about 1,900 new cell towers, added new network spectrum and wired more neighborhood towers with faster connections.
But new challenges are facing AT&T. As Apple's iPhone continues to nearly single-handedly drive the company's growth, data congestion hinders many heavy iPhone users who live in urban cities where quarters are tight.
Earlier last week, the company also announced plans to launch Apple's new iPad -- a tablet computer that focuses on Web surfing and Internet. AT&T also lifted its ban on Internet calling services, such as Google Voice, over its 3G network.
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