UK iPhone carrier O2 has announced that it has sold over one million iPhones while at the same time reported a 10% rise in revenues.

O2 which is owned by Spanish firm Telefónica gained 390,000 new mobile phone customers in the last quarter of 2008 strengthening its position as the UK’s largest mobile phone carrier.

O2 began selling the iPhone in November 2007 and has now sold over a million iPhones with no signs of sales slowing.

“iPhone sales are continuing to accelerate,” said Matthew Key, chairman and chief executive of Telefónica Europe. “And we have been pretty stunned at the results of our pre-pay offer, which is £342.33 for a year’s data usage included.”