HBO Max and HBO had 76.8 million global subscribers as of March – up by 3 million from the previous quarter and 12.8 million from the year earlier. Domestic subscribers of 48.6 million rose 4.4 million year-on-year, AT&T said, reporting its last quarterly numbers as parent of WarnerMedia.
WarnerMedia merged with Discovery April 8 creating Warner Bros. Discovery.
“AT&T has entered a new era,” said CEO John Stankey, with the telco now pared back down to its core businesses in mobility, business wireline and consumer wireline.
AT&T said the subscriber bump was mostly driven by international as well as domestic retail subscriber gains. Domestic subscriber ARPU was $11.24.
Investors will be scrutinizing the numbers after sentiment on streaming leader Netflix turned sour this week following disappointing subscriber numbers and forecasts in its quarterly report Tuesday. AT&T execs are holding a conference call at 8:30 am ET to discuss the numbers.
WarnerMedia operating income fell 32.7% on continued investments in HBO Max and the launch of CNN+. Expenses rose on higher programming and marketing costs. Ad sales dipped. Revenue rose 2.5%.
WarnerMedia first quarter highlights:
Revenue was $8.7 billion, up 2.5% from the year before year before, driven by higher subscription revenues and higher content and other revenues, partially offset by lower ad sales.
Subscription revenues of $4 rose 4.4%, primarily reflecting growth of HBO Max.
Content and other revenues was $3.1 billion, up 3.4%, driven by higher theatrical and HBO Max licensing, offset in part by lower TV licensing. Advertising revenues fell $1.7 billion, down 3% due to lower linear audiences and tough comps to the prior-year political ads, partially offset by higher sports.
Operating expenses totaled $7.4 billion, up 13% year over year driven by higher marketing costs as well as higher programming costs and incremental selling costs associated with DIRECTV advertising revenue sharing arrangements.
Operating income of $1.3 billion fell 32.7% on continued investments in HBO Max and the launch of CNN+. Operating income margin was 15.1%, compared to 23%.
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