It's almost time to hear how the second quarter treated telecommunications giant AT&T (NYSE:T). Let's see what factors will be in play when the company reports tomorrow.

What analysts say:

  • Buy, sell, or hold the line? Of the 26 analysts following Ma Bell, 18 rate the stock a buy, seven say hold shares, and one recommends selling. AT&T ranks as a four-star stock in our Motley Fool CAPS community, with 3,687 members offering an opinion on the company.
  • Revenue. The average expectation is for an increase of 6% to $31.2 billion for the quarter.
  • Earnings. The average analyst expects non-GAAP profits of $0.76 per share.

What management says:
AT&T's favorite word in its first-quarter earnings release was "ramp," as CEO Randall Stephenson noted that, "Revenue growth continues to ramp, we have good momentum across key growth areas, major cost initiatives are on track, and our operational results reinforce the confidence we have in our outlook." In addition to holding a strong line against Verizon (NYSE:VZ) and Sprint Nextel (NYSE:S) in wireless, AT&T is experiencing an "accelerated ramp" in subscribers for its broadband TV service U-verse. The company added a net 148,000 subscribers to reach 379,000 in service and says it's on track to reach more than 1 million subscribers by the end of 2008.

What management does:
Exclusive rights to carry the Apple (NASDAQ:AAPL) iPhone continue to do wonders for AT&T's wireless business. It has helped the company add subscribers and stabilize ARPU, even as voice revenues continue to dwindle.








Net Additions (millions)





















Source: AT&T.

One Fool says:
While Apple's next-generation iPhone has grabbed all the headlines, AT&T continues to expand its device inventory with killer products like the latest Nokia (NYSE:NOK) handsets and Research In Motion (NASDAQ:RIMM) BlackBerrys. The company has also been aggressively expanding the reach and capacity of its broadband wireless (3G) network, along with its fiber-optic network, bringing the quadruple play of services to more cities in the U.S.

But even though it won't affect financials until next quarter, the new $199 price tag on the Apple iPhone will have the market keenly focused on early sales figures for the upgraded and cheaper device. And it should be: With the lower upfront price diving deeper into the mainstream, investors want to know if a full-fledged revolution is at hand.

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Fool contributor Dave Mock still holds the neighborhood record on Asteroids. He owns no shares of companies mentioned here and is the author of The Qualcomm Equation. Apple is a Stock Advisor recommendation. You don't have to take a number to read the Fool's disclosure policy.