U.S. Cellular reported mixed financial results for Q2 2008 yesterday.  Profit sharply tumbled to $72.6 million from $147.6 million a year ago.

The good news is that revenue increased 9% from last year to $987.4 million because of growth in service and data plans, CEO John Rooney said.

“These revenue increases have driven a substantial increase in ARPU, with more than 50% of our customers using at least one data service. And our low, 1.4% churn rate is proof that our customers believe in U.S. Cellular and in the communications experience we provide, even as they may be tightening their budgets in response to the economic slowdown,” he said.

Smartphone sales are doing better than expected and the company plans its EV-DO coverage to reach 30% of customers this year and into 2009, he added.  However, “Net retail customer additions for the quarter were disappointing,” he said.

U.S. Cellular also said its previously stated revenue guidance of $3.9 billion to $4.0 billion for the full year remains accurate.