AT&T also reported that wireless revenues grew 5.7 percent year over year, while wireless service revenues grew 4.2 percent.
AT&T had 780,000 wireless postpaid net adds, the largest increase in three years; with a 1.1 million increase in total net wireless subscribers.
But that growth also came at a price. Since AT&T subsidizes smart phones, and since so many customers purchased Apple iPhones that have the highest subsidy costs in the business, earnings took a hit. In fact, 84 percent of all smart phone sales were iPhones.
Verizon, for its part, added a "highest-ever" 2.1 million net new wireless contract customers in the fourth quarter, outpacing AT&T's growth.
As expected, Verizon profit margins on mobile services dropped as smart phone subsidies grew.
And that is an issue: though service providers want to sell more data subscriptions, which mainly entails selling more smart phones, the device subsidies are a drag on earnings.
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