AT&T Takes Big Entertainment Hit

AT&T reported a 4.5% year-on-year fall in revenues to 42.8 billion US dollars for the first quarter of 2020. It said that 600 million of the 2 billion dollars shortfall was due to COVID-19, as sports advertising and wireless equipment sales suffered.

In the telco's communications division, revenues fell 2.6% to 34.2 billion dollars due to declines in the  entertainment group, wireless equipment and business wireline that were partially offset by gains in wireless service revenues. In the first quarter, premium TV subscribers (which includes DirecTV, U-verse and AT&T TV subscribers) fell by 897,000 "due to competition and customers rolling off promotional discounts as well as lower gross adds from the continued focus on adding higher-value customers." The video-on-demand service AT&T TV NOW saw a net loss of 138,000 subscribers due to higher prices and less promotional activity. AT&T is planning to launch HBO Max at the end of May.

In the Warner Media division, revenue was down 12.2% to 7.4 billion dollars, while revenues from Latin America fell 7.5% to 1.6 billion dollars as foreign exchange pressures more than offset growth in Mexico. Source: AT&T statement