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AT&T said the number of activated subscriptions to the HBO Max streaming service doubled in the fourth quarter to 17.2 million from the third quarter, in part due to the release of Wonder Woman 1984.
Total domestic subscriptions to HBO and HBO Max reached 41.5 million, which the company said was two years ahead of its initial forecast and up from 34.6 million in quarter 2019. Before HBO debuted Max in May 2020, AT&T said its five-year goal was to get 50 million US subscribers in total, and between 75 million and 90 million worldwide.
While HBO Max costs $ 15 per month for direct retail subscribers, existing HBO subscribers have the right to activate their subscriptions at no additional cost. AT&T struggled initially to generate these conversions, especially with competitors launching much cheaper streaming alternatives. The company recently decided to dramatically increase the stakes on the streaming service (to the dismay of many in Hollywood) by putting the entire Warner Bros. 2021 movie release list on HBO Max at the same time it hits theaters. WW1984 followed this pattern to release on Christmas Day. No data on its performance was shared in the publication of the results.
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HBO Max, which competes with other emerging services like Disney +, Apple TV + and Peacock, benefited in the fourth quarter from a distribution deal with Roku, concluded in December. An equally groundbreaking distribution deal was struck with Amazon in November, finally opening up access to the two major US streaming providers.
The streaming information highlighted quarterly results that beat Wall Street forecasts, although they fell from a year earlier as the telecoms and media giant continued to face the effects of Covid-19.
Earnings per share were 75 cents for the quarter ended Dec.31, up from 89 cents for the same period in 2019, with revenue of $ 45.7 billion, compared with $ 46.8 billion. dollars. Analysts had expected a profit of 73 cents and sales of $ 44.6 billion.
The Mobility division propelled the quarterly performance, with equipment revenue in that unit up 28% to $ 6.1 billion. AT&T said the gains were due to sales of smartphones, a mix of more expensive postpaid smartphones, and higher sales of postpaid data devices. The roll-out of 5G services as well as new Apple iPhones helped improve quarterly results.
WarnerMedia’s revenue is down almost 10% from a year ago to $ 8.6 billion. AT&T estimates that its television and film revenues were hit by $ 1.6 billion in the quarter. Warner Bros. revenue alone plunged 21%.
Pay-TV subscriptions continued to decline, with 617,000 video customers lost in the quarter, although broadband growth offset declines, as it has in recent years. AT&T TV Now, the internet-based television offering launched in 2016 as DirecTV Now, has been closed and AT&T is in talks to sell a controlling stake in DirecTV, which it acquired in 2015.
Video revenue fell 11% to $ 7.2 billion, which the company blamed on lower premiums and
OTT subscribers, partially offset by higher premium TV revenues per customer and a wave of election ads. In addition to the challenge of operating during Covid-19, the company said the quarterly revenue figure included estimated billing credits for 2020 to be provided to subscribers for less broadcast of regional sports network programming.
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