And investors don't seem to care. The stock is trading marginally lower because Big Red didn't blow away Street expectations in reporting third-quarter results. Revenue grew 5% to $27.9 billion, while profits checked in at $0.56 a share. Both figures were slightly ahead of analyst projections.
Yet the beat isn't what matters here. Growth is what investors need to pay attention to, and Verizon has more of it than AT&T does. Wireless revenue improved 9% year over year, easily beating the 3% growth AT&T achieved during an otherwise good third quarter.
No one looking at subscriber data should be surprised by these figures. Verizon had 882,000 post-paid net additions during the quarter, more than double the 319,000 AT&T had during Q3.
Why the difference? Handset parity may have something to do with it. Apple (NAS: AAPL) no longer sells exclusively to AT&T, and both carriers offer most Android handsets. Both networks also host significant numbers of Nokia (NYS: NOK) and Research In Motion (NAS: RIMM) handsets.
Therein lies the problem for AT&T. Now that users have the option to have any smart device on any network, they're signing with Verizon in ever-greater numbers.
My guess is marketing and word of mouth are responsible for fueling this trend. But LTE -- short for "Long Term Evolution," a high-speed wireless broadband standard -- may also play a role. Remember, it was an HTC Thunderbolt operating on Verizon 4G that blew away Sprint Nextel's (NYS: S) best in tests conducted several months ago, leading some to favor the HTC device over the iPhone for a time.
Verizon has been aggressively rolling out 4G LTE service nationwide over the past year. AT&T won't go national with its LTE network until next year. Don't be surprised if Big Red's wireless business continues to grow faster in the meantime.
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At the time thisarticle was published Fool contributorTim Beyersis a member of theMotley Fool Rule Breakersstock-picking team. He owned shares of Apple at the time of publication. Check out Tim'sportfolio holdingsandFoolish writings, or connect with him onGoogle+or Twitter, where he goes by@milehighfool. You can also get his insightsdelivered directly to your RSS reader.The Motley Fool owns shares of Apple.Motley Fool newsletter serviceshave recommended buying shares of AT&T and Apple and creating a bull call spread position in Apple. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
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