Advertisement
YOU ARE HERE: LAT HomeCollections

AT&T Net Dips; MCI Posts Gain as Share Grows

October 20, 1987|BRUCE KEPPEL | Times Staff Writer

Third-quarter earnings for American Telephone & Telegraph slipped 5% to $505 million, AT&T said Monday. Meanwhile, its chief rival in long-distance telecommunications, MCI Communications, "knocked the cover off the ball," as one bullish analyst put it. MCI earnings rose 22%.

Washington-based MCI said third-quarter profit increased to $22 million on revenue of $994 million. That compares to $18 million earned for the same period last year on $910 million in revenue. Second-quarter earnings were $8 million.

For the nine months of the year, MCI's earnings totaled $55 million on revenue of $2.9 billion, little changed over the $54 million earned in the same period of 1986 on $2.67 billion of revenue.

"They knocked the cover off the ball," Robert B. Morris III, telecommunications analyst for Prudential-Bache Securities in San Francisco, said of MCI's earnings report. Morris said operating income more than doubled his expectation. "It's not just a cost-savings story," he said. "They are growing in market share."

Morris estimated MCI's share of the long-distance telecommunications market at 8.7%, compared to 6.2% for No. 3 US Sprint, whose earnings are expected today. AT&T continues to dominate the market with a 78% share.

Computer Sales Falter

New York-based AT&T reported earnings of $505 million for the three months ended Sept. 30, down from $533 million the year before. The year-ago results were helped by one-time additions to income, the company said. Revenue was $8.474 billion, up slightly from $8.427 billion a year ago.

Nine-month earnings totaled $1.546 billion, 18% higher than last year, which included a $175-million charge reflecting a change in accounting for depreciation. Revenue totaled $24.996 billion, down from $25.558 billion last year.

The company said sales of computers continued to fall as did revenue from equipment rentals, but long-distance calling volume continued to grow strongly along with sales of the company's large electronic switches.

Separately, another of AT&T's seven former regional offspring, BellSouth Corp., reported third-quarter earnings of $418.6 million, up 4.9% on revenue of $3.12 billion, up 8%. For the first nine months, the Atlanta-based company said earnings totaled $1.25 billion, up 1.6%, on revenue of $9.1 billion, up 5.6%.

Advertisement
Los Angeles Times Articles
|
|
|