Salem Radio Network News Monday, May 16, 2022

Business

AT&T profit beats estimates on strong streaming growth

By Sheila Dang

(Reuters) -AT&T Inc beat analysts’ estimates for fourth-quarter profit and revenue on Wednesday amid solid growth in its streaming platform HBO Max and a rise in wireless customers, sending shares higher in premarket trading.

Revenue at WarnerMedia, which houses premium TV channel HBO and streaming service HBO Max, rose 15.4% to $9.9 billion in the quarter.

The growth at WarnerMedia comes as AT&T works to unwind its media investments and refocus on its original business of providing phone and internet services. The Dallas-based company said it now expects its deal to merge WarnerMedia with Discovery Inc to close in the second quarter.

The company’s shares were up about 2% in trading before the market opened.

HBO and HBO Max together added 4.4 million subscribers during the quarter, drawing viewers with releases such as “Dune”, “The Matrix” and the newest season of TV show “Succession”.

The company signed up 884,000 net new phone subscribers who pay a monthly bill in the quarter, in line with its preliminary result of 880,000 released earlier this month.

Rival carrier Verizon on Tuesday reported a better-than-expected 558,000 subscriber additions in its latest quarter.

AT&T has prioritized its fiber internet business as an area for growth, and said it added 271,000 net new customers during the quarter.

Total consolidated revenue was $41.0 billion in the quarter ended Dec. 31, beating analysts’ estimates of $40.44 billion, according to Refinitiv Data.

Excluding items, AT&T earned 78 cents per share, above analysts’ average estimate of 75 cents.

Including WarnerMedia and Xandr, AT&T now expects 2022 revenue growth in the low-single-digit percentage range.

The company expects annual adjusted earnings of between $3.10 and $3.15 per share in 2022, short of analysts’ average estimate of $3.21.

AT&T, which faces fierce competition from rivals Verizon and T-Mobile US amid nationwide deployment of their 5G technology, forecast 2022 capital expenditure in the $20 billion range.

(Reporting by Richard Rohan Francis and Chavi Mehta in Bengaluru and Sheila Dang in Dallas; Editing by Saumyadeb Chakrabarty and Bernadette Baum)

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