In the middle of a decent earnings announcement Tuesday, AT&T Wireless Services announced that the company is exiting the fixed wireless business.
According to officials of the Redmond, Wash., company, the business unit did not meet financial targets in the third quarter. The business, which serves nearly 48,000 customers, will be phased out in the next several months, they said.
"This is the right decision, given our strategic priorities and the additional capital our fixed wireless business would require going forward," said AT&T Wireless Chairman John Zeglis, in a statement. "We are committed to a phased exit that will ensure a high level of support for affected customers."
The company expects to take fourth quarter pre-tax charges of approximately $1.3 billion, associated with its exit from the fixed wireless business.
The move is the second major blow to fixed wireless in less than a week. Last week, Sprint Corp. announced that it is ceasing expansion of its fixed wireless operations indefinitely, although the business will continue to operate in its current markets.
On the mobile side, AT&T Wireless reported a 25.1 percent increase in total revenues -- $3.5 billion for its third quarter compared with $2.8 billion for the same year ago period. The cell phone service business rose 29.1 percent to $3.24 billion, compared with $2.51 billion last year.