The US’s second-largest telecoms firm reported a 9 per cent slide in second-quarter income because the impression of coronavirus on its Warner Media division drove a $830m hit to its enterprise.
AT&T, which additionally owns HBO, mentioned its income dropped to $41bn within the second quarter as its working earnings greater than halved to $3.5bn from $7.5bn in the identical interval a yr earlier.
The outcomes mirrored a blow to its enterprise from the coronavirus pandemic. AT&T mentioned the disruption value it $320m within the three-month interval within the type of compensation to front-line workers that weren’t capable of work and disruption to media manufacturing. It additionally booked a bigger $510m cost reflecting the hit to promoting income, the closure of cinemas, cancellation of sporting occasions in addition to decrease cellular roaming and telephone gross sales in the course of the quarter.
The income decline was in keeping with expectations though progress in new cellular subscribers undershot forecasts.
The comparatively modest take-up of HBO Max, which was launched with some fanfare in Could, can be a blow to AT&T’s Warner Media division, who see the service because the digital store window for its greatest content material.
HBO income declined 5 per cent to $1.6bn and the general HBO subscriber base, together with the Max streaming platform, grew to 36.3m from 34.6m on the finish of 2019. The corporate mentioned HBO Max was “monitoring in direction of preliminary targets”.
Netflix, one of many massive beneficiaries of the lockdown financial system, added 10m subscribers within the second quarter, taking its international subscriber near 200m.
“Our stable execution and focus in a difficult surroundings delivered important progress within the quarter, most notably the profitable launch of HBO Max, resilient free money circulate and a strengthened stability sheet,” mentioned John Stankey, AT&T chief govt, who was appointed in April.