AT&T reported net income of $3.5 billion for the first quarter of 2008, up from $2.8 billion in the first quarter of 2007. Strong wireless and data revenue drove the results.

Total revenue reached $30.7 billion for the quarter, which ended 31 March. Revenue was up 6.1 per cent from the first quarter of 2007, the company reported on Tuesday.

The company's wireless division posted revenue increases of 18.3 per cent from the first quarter of 2007, including a 57.3 per cent increase in wireless data revenue. Wireless revenue for the quarter was $11.8 billion, with wireless data revenue making up $2.3 billion of that total. Wireless data, including email, messaging and data access, now represents 21.5 per cent of AT&T's wireless revenue not including handset and accessory sales, up from 16 per cent in the first quarter of 2007 and 10.9 per cent in the first quarter of 2006, the company said.

AT&T has been the exclusive provider of wireless service for Apple's iPhone in the US since the handset shipped in June 2007. "iPhone continues to be very popular with customers, feedback is very good," the company said. AT&T also confirmed a high average revenue per iPhone user - in the "mid to upper 90's". "We continue to see customers adopting iPhone. Over 40 per cent are new to us," the company said.

AT&T reported a net gain of 104,000 wireless subscribers during the quarter. The company now has 1.3 million wireless subscribers.

"AT&T is moving quickly to create the next generation of wireless," chairman and CEO Randall Stephenson said in a statement. "The future of wireless has never been more promising, and I am very pleased that we have assembled the industry's premier, high-quality wireless spectrum position."

AT&T announced Friday that it would lay off about 4,650 employees, mostly from management positions, in an effort to streamline operations. The company's total number of employees, about 310,000, was expected to remain unchanged however, as AT&T hired people in other areas, the company said.