Advanced Television

HBO add 13m subs in 2021, at a cost

January 27, 2022

AT&T has reported its Q4 and full-year financials revealing that its WarnerMedia entertainment unit added a combined 13.1 million subscribers across HBO and HBO Max in 2021. But it was at a cost, record subscribers meant record revenue but also record spending on content and marketing, meaning earnings were lower.

“We surpassed our high-end guidance for global HBO Max and HBO subscribers, adding 13.1 million subscribers in 2021, more than any year in HBO’s history. HBO Max and HBO now reaches a base of 73.8 million subscribers globally. WarnerMedia is well positioned as a dynamic global business,” said AT&T CEO John Stankey,

During the fourth-quarter operating income fell 38 per cent to $1.58 billion, even though quarterly revenue rose 15.4 per cent to $9.9 billion, “reflecting the partial recovery from prior-year impacts of the pandemic.”

The company cited “higher content and other revenues and subscription revenues, partially offset by lower advertising revenues.”

WarnerMedia’s overall operating expenses jumped 38 per cent in Q4 to $8.3 billion, “driven by higher film and programming costs, increased marketing and incremental selling costs associated with DirecTV advertising revenue sharing arrangements.”

Direct costs supporting direct-to-consumer revenues amounted to $2.3 billion in the fourth quarter, versus $1.6 billion in the year-ago quarter.

AT&T upped forecasts stating HBO Max and HBO will reach a combined 120 million to 150 million subscribers by the end of 2025.

Stankey also confirmed the spin-off / merger with Discovery was proceeding ahead of schedule.

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