In the middle of AT&T’s massive rebranding campaign of Cingular, the wireless business unit lost a bit of its momentum, adding 1.2 million net subscribers in the first quarter compared to the 2.4 million it added in Q4 of last year. Competition from other providers is becoming heated, but despite the pressure, AT&T’s new mobility unit managed to pull off improved churn numbers, higher average revenue per user and increased its data revenues by 67%.

AT&T posted wireless revenues of $10.0 billion, a 11.2% increase over last year’s 1^st quarter, when Cingular was separate operating entity owned jointly by AT&T and BellSouth. The mobility division reported a profit of $1.48 billion, up 91.7% over the same period. AT&T’s wireless operations are rapidly catching up with its legacy wireline voice unit, encompassing the former SBC and BellSouth territories. Voice accounted for $10.6 billion in revenues, just $600 million shy of its wireless intake.

The mobile unit’s total churn was 1.7%, down form 1.9% a year earlier and 1.8% the previous quarter. It also said a company record for postpaid churn at 1.3%. The company’s total subscriber base is not at 62.2 million.

Average revenue per user increased to $49.21 a month, up 1.4% from a year earlier. It’s data ARPU jumped 66.8% to $1.5 billion, and data ARPU increased to $7.88 a month, up 51%, and now accounts for 16% of customers’ phone bills.