Smartphones made up 93 percent of total phone sales and 77 percent of the postpaid phone base. The carrier also added 440,000 new tablets during the quarter.
Compared to the year-ago quarter, AT&T gained 300,000 fewer new subscribers, but saw a record low contract churn rate of 1.11 percent and an overall churn rate of 1.43 percent. A company's churn rate is the percentage of customers that leave the carrier during the quarter. It appears that AT&T is managing to retain most of its subscriber base at this point, but during the next quarter, T-Mobile's efforts to lure AT&T customers may become more apparent.
AT&T Next, AT&T's smartphone and tablet upgrade program, has drawn more than 1.5 million customers since it was first launched in July of 2013.
Earlier in January, AT&T competitor Verizon announced smartphone activations of 8.8 million along with 1.7 million new subscribers. Verizon continues to have a bigger postpaid customer base than AT&T at 96.2 million wireless customers compared to AT&T's 72.6 million.
Overall, AT&T announced a profit of $6.9 billion on $33.2 billion in revenue.