Earnings Reports for July 25
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Ameritrade Posts Mixed Results
Online discount broker Ameritrade reported a91 percent increase in net revenues to $149 million for itssecond quarter, compared with $78 million in the same quarter lastyear.
But net income was $4.6 million, or 3 cents per share in thequarter ended June 30, compared with $8.9 million, or 5 cents pershare in last year’s third quarter.
The company spent $41 million on advertising in the latestquarter, compared with $12 million in last year’s third quarter,and it spent $16.2 million developing its OnMoney subsidiary,compared with $1.6 million in the third quarter last year. The Website OnMoney allows customers to organize their finances on theInternet.
Ameritrade, among the top 10 online brokers in number of trades,has been spending on advertising to develop its brand name and ontechnology to lower its costs per trade. Chief executive Tom Lewissaid those investments are paying off, and the company added186,000 accounts in the last quarter.
“We’re making investing a better customer experience by stayingkeenly focused on the needs of the self-directed investor,” Lewissaid.
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AT&T Meets Expectations
Quarterly profits at AT&T Corp.’s.and its newwireless group beat Wall Street forecasts, but the nation’s biggestlong-distance and cable TV company didn’t convince some analyststhat recent problems have been overcome.
AT&T said net profits totaled $1.75 billion or 53 cents a sharein the second quarter, up nearly 10 percent from $1.59 billion or49 cents a share in the same period in 1999.
Operating profits, which exclude certain one-time factors andAT&T’s stakes in Cablevision and ExciteAtHome, came to $1.88billion or 57 cents a share, topping the consensus forecast ofanalysts polled by First Call/Thomson Financial.
Second-quarter revenue totaled $16.87 billion, if adjusted toinclude a full quarter from the MediaOne, the cable TV company thatAT&T acquired in mid-June.
AT&T Wireless Group posted an unexpected profit of $22 millionor 6 cents a share in an abbreviated second quarter that beganApril 27, when the company was created through an initial publicoffering of a separate stock representing AT&T’s mobile phonebusiness and a new initiative to deliver calls and Web access tohomes using “fixed wireless” antennas. Analysts had expected thewireless group, which is still fully owned by AT&T, to show a lossof 1 cent per share, according to First Call.
Wireless revenues grew 31.9 percent to $2.48 billion comparedwith a year-ago tally of $1.88 billion. The average monthly revenueper subscriber was $71.50, up from the $66.40 reported for thesecond quarter of 1999.
But aside from the wireless group’s stellar showing, the update wasn’t quite so encouraging as some analysts had hoped,especially in terms of the business services unit’s recovery fromsome first-quarter stumbles and the company’s decision to waitbefore making forecasts for next year.
Meanwhile, AT&T’s second-quarter report also provided an earlypeak at the customer response to the new PocketNet online servicefor mobile phones launched in May and the company’s limited trialswith residential fixed wireless service.
At the end of the second quarter, there were more than 80,000PocketNet users among AT&T’s 11.7 million mobile phone subscribers,a figure that has increased to more than 100,000 in July. AT&Tdeclined to quantify how many of those customers were using thebasic version of PocketNet, which is free, except to say that morethan expected had signed up for premium services.
The fixed wireless service, introduced in the Dallas-Fort Wortharea in March, now has about 2,800 customers using 6,000 phonelines and about 70 percent of whom also signed up for high-speedInternet service. The average monthly bill has been about $85 permonth.