AT&T media falls but cord cuts slow
October 22, 2020
AT&T reported a drop in Q3 revenues and profit, due mainly to the impact of the pandemic on its entertainment business.
Quarterly revenues fell to $42.3 billion from $44.6 billion in the year-ago quarter. WarnerMedia was down 10 per cent affected by the pandemic measures, while mobile service revenues (-0.3 per cent) suffered from lower roaming. Legacy wireline services also continued to erode, and Latin America revenues were hurt by forex pressure. These declines were partly offset by higher mobile equipment sales (+6.4 per cent) and higher advertising revenues as sports broadcasts resumed.
While operating costs were somewhat lower due to the slowdown in media production, operating profit still declined to $6.1 billion from $7.9 billion a year ago due to Covid-related incremental costs.
In the consumer fixed market, AT&T managed to slow the decline TV subscribers to losses of 627,000, half the number of the year-earlier period. That left the company with just under 17.8 million pay-TV subscribers at the end of the period (including 683,000 OTT customers), down 17.5 percent year-on-year. Pay-TV ARPU improved to $130.55 (excl OTT).
HBO also showed growth, reaching over 38 million paying subscribers in the US for the linear channel HBO and SVoD service HBO Max combined. That beats AT&T’s year-end target of 36 million subscribers. The total includes 28.7 million subscribers for HBO Max, up from 26.6 million at the end of June.