AT&T reported a 4.5 per cent increase in Q4 wireless revenues to $18.4 billion, including a buoyant 16.8 per cent rise for data revenue, but warned that intense competition will keep 2014 profits at the low end of estimates.

The US giant said operating income from its wireless unit was $3.9 billion, up 53.8 per cent, and that postpaid net additions hit 566,000 in the quarter. However the latter figure was down from 780,000 in the year ago period, as well as being less than analysts had estimated for the quarter.

And the operator forecast 2014 profits at the low end of analysts’ estimates as it feels the effect of domestic rivalry, particularly with the smaller T-Mobile US which claims to be gaining traction with its ‘Uncarrier’ strategy.

Earlier this month, AT&T unveiled an offer that is designed to hit back in the tariff battle.

The pressure of the price war has led investors to call for overseas expansion from AT&T. This week, the operator ruled out a bid for Vodafone. Under UK takeover rules, the US operator is now barred from a takeover for six months although analysts do not think this is an end to its interest.

Including the operator’s fixed business, AT&T’s overall consolidated revenues totalled $33.2 billion, up 1.8 percent versus the year-earlier period.

Q4 2013 net income attributable to AT&T totalled $6.9 billion compared to a loss of $3.9 billion a year earlier (due to costs related to Superstorm Sandy as well as a one-time pension charge).