AT&T says massive charges ahead in 4Q
AT&T to take $10 billion charge for pension and benefits in 4Q, says Sandy hurt period as well
NEW YORK (AP) -- AT&T Inc. warned Thursday that it will take a $10 billion non-cash charge in its fourth-quarter related to its pension plan and benefits. The company also said that the quarter's results would suffer from higher smartphone costs and damage from Superstorm Sandy.
AT&T said the pension charge is a result of an actuarial loss of $12 billion, partially offset by an asset gain of $1.9 billion.
The company said that it sold 10.2 million smartphones in the fourth quarter, which ended Dec. 31. High subsidies on the devices pressured its margins and earnings per share.
It also expects a $175 million hit to its fourth-quarter operating income as a result of storms, including Superstorm Sandy.
AT&T is scheduled to report fourth-quarter results on Jan. 24.
Shares fell 46 cents to $32.74 in after-hours trading. The stock has ranged from $29.02 to $38.58 in the past 52 weeks.