AT&T Inc (T) Updates on Mobile Business into Investor Meeting; Still Sees Q3 Churn at 1% or Lower

AT&T Inc. (NYSE: T) is providing updated information regarding the Company’s mobile business.

AT&T is holding a meeting with investors today in Atlanta. In advance of that meeting, the company is providing an update on its wireless operational results for the third quarter of 2014, along with details on progress in two emerging lines of business in its Mobility group: connected cars and AT&T Digital Life.

For the third quarter of 2014, AT&T still expects wireless postpaid churn to be 1 percent or lower. The company expects total AT&T Next take rates to be approximately 50 percent and to have over 400,000 postpaid smartphone gross adds from customers who “bring their own mobile devices” (commonly known as BYOD adds). AT&T also expects approximately 58 percent of its postpaid smartphone base to be on Mobile Share Value plans at the end of the third quarter.

AT&T expects meaningful subscriber growth for its connected car services in the next three-to-five years. As of today, AT&T provides either wholesale or retail connectivity (“connected cars”) to nearly 2 million U.S. registered passenger vehicles with about 500,000 added in the third quarter. In 2015, AT&T expects to connect nearly half of new wireless-connected U.S. passenger vehicles. The company expects to serve more than 10 million such vehicles by the end of 2017.

AT&T expects revenues from its connected cars to be driven initially by wholesale customer relationships with auto manufacturers, with the opportunity to develop a direct retail relationship with drivers. Wholesale ARPU (average monthly revenue per subscriber), paid for by auto manufacturers, is expected to be in the low single digits and retail ARPU, paid for by the car owners, is expected to be similar to that of a tablet on an AT&T Mobile Share Value Plan.

In addition, AT&T Digital Life, the company’s home security and automation service, has approximately 140,000 subscribers at the end of the third quarter with more than half of those added in the last two quarters. As of today, The Digital Life Smart Security plan ranges from $40 a month for a basic security plan to $70 a month with security and automation packages. Additional installation and equipment fees also may apply. Approximately a third of customers that sign up for Digital Life security plans are also adding automation products, with the majority of those choosing video or door-control products.

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