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AT&T reported third-quarter net income that narrowly exceeded estimates. AT&T

AT&T Inc. (NYSE: T), the No. 1 telecommunications carrier, reports third-quarter results Wednesday that are generally expected to be about flat with last year’s earnings and revenue.

The Dallas-based giant, once the world’s largest company, also is expected to face some questions, especially on how it’s doing with sales of the iPhone 5 from Apple (Nasdaq: AAPL), the world's most valuable technology company. Another concern is its response to the proposed $20.5 billion acquisition of a 70 percent stake in its smaller rival, Sprint-Nextel Corp. (NYSE), by Japan’s SoftBank Corp. (Tokyo: 9984).

AT&T was the first U.S. carrier to offer the iPhone and therefore the first to pay the huge subsidies Apple, of Cupertino, Calif., demands to carry the coveted product. Signing customers to two-year contracts is intended to lower their price for the cult item, but AT&T, and all other carriers, have to pay Apple handsomely for the privilege.

For the nine days of the quarter it was available, AT&T said it sold 5 million iPhone 5s.

Another big question for CEO Randall Stephenson will be the response to SoftBank's effective takeover of Sprint, as well as the planned total acquisition of mobile rival MetroPCS Communications Corp. (NYSE: PCS) by Deutsche Telekom (Pink: DTEGY). A year ago, AT&T had planned to acquire the German carrier’s T-Mobile USA unit in a $39 billion deal nixed by the U.S. Justice Department.

Now Deutsche Telekom proposes a complex transaction to inject T-Mobile, the No. 4 mobile carrier, into MetroPCS, of Richardson, Texas, and acquire the whole “new” T-Mobile, making it a stronger No. 4.

AT&T, No. 1 in landline phone customers as well as mobile, doesn’t like either deal but hasn’t been vocal about it.

AT&T Wireless had 105 million customers in the second quarter. The Verizon Wireless unit of Verizon Communications (NYSE: VZ), the No. 2 U.S. carrier, reported its third-quarter customer number had risen to 95.9 million. Sprint, which reports third-quarter results Thursday, had about 56 million wireless customers as of June 30.

Analysts surveyed by Thomson Reuters expect AT&T to report net income of $3.64 billion, or 60 cents a share, compared with $3.62 billion, or 61 cents, a year ago. Revenue is expected to rise only about $100 million to $31.57 billion.

Here are some other questions likely to be posed to AT&T’s Stephenson and CFO John Stephens:

Data plans, especially if it copies Verizon Wireless and prohibits its unlimited data plan from using the smartphone subsidies;

Investment in long-term evolution (LTE) network expansion to battle with Verizon Wireless’s bigger network;

Dealing with pension plans and its recently ratified contracts with its 40,000 employees represented by the Communications Workers of America;

An earnings forecast and prospects for higher traffic now that more products such as the iPad and iPhone 5 and rivals have LTE connectivity;

The new link with International Business Machines Corp. (NYSE: IBM) for cloud communications for AT&T Secure Network customers that becomes effective on Jan. 1.

Shares of AT&T fell 26 cents to close at $35.00 on Tuesday. Shares have gained 16 percent this year and 21 percent over the past 52 weeks.