FTSE 100-listed BT reported better than expected pre-tax profit for the first three months of the year on Thursday.
The former state-owned state telecommunications monopoly posted profit before tax of £747 million ($1.3 million), better than the £653 million forecast by analysts in a Reuters poll. This compared with the £687 million reported in the same period last year.
Sales in the first three months of the year also beat expectations, coming in at £4.7 billion.
"The business is doing well. It has had a period of slightly poorish results, but over the last five or six quarters, we have steadily delivered what we said we would," BT CEO Gavin Patterson told CNBC.
Shares of BT led the FTSE 100 on Thursday, trading 3.4 percent higher.
He said the business had been boosted by demand for superfast internet and by its group of sports television channels, known as BT Sport, which is a competitor to BskyB.
"We've gone from being the laggard in Europe to having the best broadband across Europe… We are growing faster than Sky in the broadband market," said Patterson.
BT Sport posted a record 9 percent growth in revenue in the quarter. It also reported it was growing its full-year dividend by 15 percent to 10.9 pence.
"There is a group of customers who are attracted by sport, but it is not the only thing… we think about half of consumers are interested," added Patterson.