LITTLE ROCK, Ark.-Alltel Corp. reported weaker-than-expected fourth-quarter wireless earnings, but outpaced analysts’ predictions by adding 147,000 net new wireless subscribers during the final three months of 2005, most of which were prepaid customers.
Alltel reported that 90,000 of 147,000 net new wireless subscribers were prepaid customers. The carrier’s heritage markets performed strongly, and Alltel lost only 37,000 subscribers from former Cingular Wireless L.L.C. markets, which Alltel transitioned from GSM to CDMA technology. Some analysts had predicted the rural carrier would lose all 119,000 subscribers in those areas.
Alltel’s customer churn figures were at 2.2 percent for the quarter, up from 2.17 percent in fourth-quarter 2004. For the year, Alltel said it had total wireless churn of 2.17 percent, down from the 2.23 percent the carrier reported for 2004. Average revenue per user for the fourth quarter stood at $52.13, up 6 percent from the same quarter in 2004. Yearly ARPU was up 7 percent from 2004 to $51.44.
Alltel reported consolidated revenue of $2.58 billion for its wireless and wireline business and fully diluted earnings for the quarter of 77 cents per share from current businesses.
In 2005, Alltel completed market swaps or acquisition with Cingular, PSC Wireless, and U.S. Cellular Corp., as well as acquired Western Wireless Corp. The company also announced that it was spinning off its wireline business in a $9.1 billion deal that would leave the rural carrier as a wireless-only business. Alltel noted that the deals expanded its wireless footprint to include 76 million potential customers and that it now has a customer base of more than 10 million wireless subscribers.
