AT&T 2Q profit up 30 pct, matching Street's view

AT&T stock has been hammered in the last few months by the expectation that economy-conscious consumers would pressure profits. The latest results affirmed that, as the company slightly missed analysts' revenue expectations and reported an accelerating loss of landline subscribers.

However, investors were apparently expecting worse, and sent AT&T's shares up $1.24, or 3.9 percent, to close at $33.06.

AT&T said sales of Apple Inc.'s second-generation iPhone, for which it is the exclusive U.S. carrier, were nearly double those of the first iPhone model in the first 12 days the device was available.

The latest iPhone went on sale July 11, after the end of the second quarter on June 30, so those sales are not part of the financial results reported Wednesday. AT&T said 40 percent of buyers were new to the company.

AT&T earned $3.77 billion, or 63 cents per share, in the quarter, up 30 percent from $2.90 billion, or 47 cents per share, in the same period a year ago.

Excluding merger-related one-time charges, AT&T said it earned 76 cents a share. That matched the average estimate of analysts polled by Thomson Financial.

Revenue rose 4.7 percent to $30.9 billion. Analysts expected $31.1 billion in revenue, according to Thomson.

The company, which recently moved its headquarters from San Antonio to Dallas, ended the quarter with 58.9 million phone lines in service, down 2.6 percent from 60.4 million three months earlier. That's a faster decline that many analysts had expected.

AT&T's 22-state local-phone service area includes parts of the country where the drop in the real-estate market has hit the hardest, like the Midwest and Florida.