AT&T, in its last full quarter as owner of WarnerMedia, said that HBO Max and HBO had 76.8 million global subscribers, up 12.8 million from a year ago and 3 million from the fourth quarter.
Domestic HBO and HBO Max subscribers were up 4.4 million to 48.6 million in the first quarter from a year ago and 1.8 million from 46.8 million last quarter.
The numbers show HBO and HBO Max continuing to show growth versus Netflix, which on Tuesday made the stunning announcement that it lost 200,000 subscribers in the quarter, which Wall Street took as a sign that the future of streaming may be more limited than previously thought.
AT&T completed the spinoff and sale of its WarnerMedia unit to Discovery, creating Warner Bros. Discovery and getting the phone company out of its ill fated and expensive attempt to become a media company.
“We reached a major milestone in the repositioning of our business. With the completion of the WarnerMedia Discovery transaction less than 11 months,” AT&T CEO John Stankey said during the company’s earnings call Thursday morning.
“I'd also like to share how proud we are of the entire WarnerMedia team. David [Zaslav, Warner Bros Discovery CEO], inherits an organization with one of the best global portfolios of beloved intellectual property. a team with unparalleled talent, and one of the few truly global direct-to-consumer players as evidenced by the continued growth and HBO Max and HBO subscribers,” he said. “Warner Brothers Discovery is well positioned to lead the transformation we're seeing unfold across the media and entertainment landscape and like many of my fellow AT&T shareholders, those who own a stake in this new and promising Enterprise. We're excited to continue to watch their success and the value they create is one of the leading global media companies.”
WarnerMedia operating income was $1.3 billion in the first quarter, down 32.7% because of investments in HBO Max and the launch of CNN Plus.
Revenue for WarnerMedia were $8.7 billion, up 2.5% from a year ago. The company cited higher subscription revenue, offset by lower advertising revenue, which was $1.7 billion, down 3%.
Subscription revenue was up 4.4% to $4 billion, reflecting the added customers at HBO Max.
For AT&T, first quarter net income was $4.8 billion, or 65 cents a share, down from $7.5 billion, or $1.02 a share a year ago.
“Our momentum in growing customer relationships is reaching historical levels,” said Stankey in a statement. “We had our best first quarter for postpaid phone net adds in more than a decade and our fiber broadband net adds remain consistently strong. Our results, including free cash flow, are in line with our expectations toward delivering on the full-year guidance provided at our recent analyst day.”
“AT&T has entered a new era, meeting this opportunistic moment from a position of flexibility and strength thanks to our evolving networks, enhanced customer experience, growing 5G and fiber customer base and a much stronger balance sheet. And we continue to make good consistent progress on our journey to becoming America’s best broadband provider," Stankey added. ■
