AT&T impresses with 4.5M iPhone activations, but disappoints with low net adds

October 24, 2012 | By Sue Marek

Ralph de la Vega, president and CEO of AT&T Mobility, noted that there was very strong demand for the iPhone 5 after it launched in September. However, he said that AT&T couldn't meet demand with its iPhone supplies, which meant that the available devices went to existing AT&T customers who wanted to upgrade vs. new customers. AT&T sold 1.3 million iPhone 5 devices in the quarter. De la Vega added that he expects the company will increase its percentage of gross adds in the fourth quarter if the supply constraints for the iPhone 5 ease.

Verizon Wireless (NYSE:VZ) during its third quarter earnings call last week also noted supply constraints around the iPhone 5. Notably, Verizon only sold 3.1 million iPhones in the third quarter, of which 651,000 were the iPhone 5.

De la Vega also touted the fact that the AT&T reported average monthly revenue per user of $65.20, the company's strongest ARPU in six quarters. The company also said its phone-only ARPU increased nearly 3 percent. Competitor Verizon Wireless is no longer reporting ARPU but instead is reporting average revenue per account because of the introduction of its Share Everything plan, which lets customers add multiple devices to one account. AT&T has not said whether it will make a similar change in its metrics.

Interestingly, AT&T's Mobile Share shared data plans, which launched in August, have attracted about 2 million subscribers. De la Vega noted that more than one-third of those customers signed up for the 10 GB or higher data plans.

AT&T also noted that its LTE deployment is ahead of schedule, with the network now covering more than 135 million POPs. 

Here's a breakdown of AT&T's other key metrics for the quarter:

Financials: Total wireless revenues were up 6.6 percent year over year to $16.6 billion. Service revenues were up 4.5 percent to $14.9 billion in the third quarter. Data revenues were up 18.3 percent to $6.6