iOpening Results for AT&T

At The Motley Fool, we pride ourselves in being unconventional. It's no surprise, then, that fellow Fool Tim Beyers took the pop media to task yesterday for its assessment that AT&T 's (NYSE: T) earnings report included "disappointing" results on iPhone activations. Stock in Ma Bell took a quick dip before people realized that -- oh, yeah -- there's more to this $248 billion company than 30 hours' worth of sales of one product.

And I agree with Tim that in that mere 30 hours, the iPhone provided a meaningful impact for a vital part of AT&T's business. Given a healthy boost from 146,000 activations of the new Apple (Nasdaq: AAPL) gadget, the company added nearly 1.5 million wireless subscribers for the quarter, surpassing the 1.3 million total net adds recently reported by competitor Verizon Wireless, a joint venture between Verizon Communications (NYSE: VZ) and Vodafone (NYSE: VOD). That's also a nice tick up from the 1.2 million net adds last quarter, and it's comparable to last year's effort.

It was also nice to see a big boost this quarter in average revenue per user. That figure has now risen to $50.63, with the bulk of the increase coming from customers' increased spending on wireless data services. The monthly subscriber churn rate also dropped to 1.6%, 10 basis points better than last quarter. AT&T's wireless business certainly isn't firing on all cylinders, but performance has picked up noticeably from the past several quarters.

The strong wireless results, along with the return of sequential growth in the enterprise-services segment, helped AT&T report $2.9 billion in net income on $29.5 billion in revenue for the quarter. That in itself is nothing spectacular, given that the company continues to lose lines to cable companies such as Comcast (Nasdaq: CMCSA) and Time Warner Cable, but it's impressive that the other areas of AT&T's business made up for the wireline losses.

So while the iPhone stats underwhelmed many onlookers, AT&T is doing just fine. The company announced that it repurchased another $3.9 billion worth of shares in the quarter, and it's now surpassed the $10 billion goal it laid out in a repurchase program announced in March 2006. Management even forecasted continued double-digit growth -- no doubt with confidence that the iPhone stands to poach more customers from Sprint Nextel (NYSE: S), Verizon, and Deutsche Telekom 's (NYSE: DT) T-Mobile in the coming quarters.