AT&T Set To Break Their Quarterly Smartphone Sales Record Thanks to iPhone 4S

AT&T 3G iPhone

AT&T appears to be all set to break their previous quarterly records on smartphone sales, largely thanks to the popularity of the iPhone 4S.

AT&T announced in an online press release that it sold 6 million smartphones in the just the first two months of the fourth quarter. With some time left, it looks like it’s ready to beat its previous record of 6.1 million smartphones.

While December is traditionally a high-sales month because of the holidays, the iPhone 4S’s immense popularity has a lot to do with that success, especially considering AT&T’s recent woes.

AT&T’s strong smartphone sales in part reflect a higher number of handset upgrades from customers who were waiting for the launch of a new iPhone. AT&T previously announced that it activated more than 1 million iPhone 4S’ in the first five days the device was available. AT&T said iPhone 4S sales remain strong. Only on AT&T’s network can iPhone 4S users download three times faster and talk and surf at the same time.

Their announcement also covers a bit of the new 4G LTE roll-out.

Stephens also said today that AT&T will turn up additional 4G LTE markets, including New York City, this month, and expects to cover 70 million people with its LTE network by year-end 2011, consistent with its previously announced plans.

AT&T also posted a regulatory filing highlighting that they’ll be due for a hit financially.

Also consistent with AT&T’s earlier guidance, these record smartphone sales are expected to have a near-term negative impact on margins and therefore earnings. However, AT&T expects that these postpaid customers over time will benefit the Company as, historically, postpaid customers produce stable revenue, reflecting their contract term, and higher average revenue per subscriber, including stronger data usage, than other customer categories.

While this may seem counter-intuitive, it’s pretty standard. AT&T will have to take over the subsidies for all of those record-breaking smartphone sales. In the long-term, however, they’ll be making up the revenue due to a larger customer-base locked into 2-year contracts.

AT&T’s success is also helped by the fact that they sell an 8GB iPhone 4. They’re the only carrier that offers the iPhone 3GS – that, too, for free with a 2-year contract.

AT&T’s long-term gains may help them improve their poor customer service or perhaps launch their 4G LTE network in more markets.

[via AT&T Press Release, AT&T Regulatory Filing]

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  • Grime

    AT&T sucks!

  • Nosferatu

    I’m sure the 4S helped with the other iPhones dropping in price but let’s not forget Android and WM7 has been pumping out some rather nice devices the last 2 months for AT&T as well.

  • onni3l

    Hello At&t I Hate you and almost everyone else dose too.
    The only thing saving you, for now, is the iPhone! = ))

    • AT&T rapes me

      I 2nd that

  • Josh

    Yeah they count the sales number but they didn’t release they number of cancel and returns. Within the next 6-12 months you going to see a lots of Refurbished iPhone 4S. Lol

  • Christian

    It’s time for tmobile to get their head out of their ass and get the iPhone. It’s clear that tmobile has the cheapest prices

  • Christian

    It’s time for tmobile to get their head out of their a$$ and get the iPhone. It’s clear that tmobile has the cheapest prices. It’s time to be saved by the iPhone.

  • fas

    and Apple still not shipping many yet!

  • Amsterpelli

    I hope that they will use their gains in the long run to upgrade their network and make it more stable … but instead I see a continuation of the poor network infrastructure and larger bonuses for executives…