Leading telecommunications provider American Tower (NYSE: AMT) reported yet another period of solid growth when it posted a 16% jump in its quarterly net income that beat Street estimates. Investors jumped for joy, sending shares up some 6%.

Let's take a detailed look at the reasons for this robust growth and its prospects for the rest of the year.

Into the numbers
Revenues for the quarter surged 27% to $597.2 million from $469.9 million a year ago. A rise in mobile broadband usage and the expansion of its operations worldwide were the driving factors behind the growth.

Operating income rose to $225.8 million from $188.7 million, a growth of 19.6%. Selling, general, and administration expenses went up 35%, including an $11.7 million payout to employees through stock-based compensation.

Cash matters
Cash from operations increased 5% to $275.5 million. The company has been spending on acquiring land for towers, improving equipment, and constructing more cell sites. Consequently, unlevered free cash flow has dropped to $19.5 million, down by almost 89% from the previous year.

Exploring new horizons
The company spent $275.2 million in the quarter on acquisitions. It has also moved into several developing markets to strengthen its tower business. American Tower's revenues are expected to rise considerably once the towers that it has acquired in these areas become operational.

Industry on a roll
American Tower's closest rival, Crown Castle (NYSE: CCI), had reported a much better profit compared to the previous year and raised guidance when it last stated earnings. With the industry looking up and more customers being added each day, American Tower should dominate the market that it already leads.

Foolish takeaway
The number of cell phone users is rising, and hence more and more customers are being added by carriers in the U.S. and abroad. This, in turn, should push up revenues of tower companies. As the global leader in towers, American Tower is expected to lead the race. With both the industry and the company going strong, I think there is no harm in having the stock in your portfolio.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.