AT&T Earnings: 'Godzilla vs Kong' and NCAA March Madness Lift Q1 Revenues

Jennifer Maas

AT&T beat analysts’ expectations for both earnings and revenue in the first quarter of 2021, which saw the theatrical and HBO Max release of “Godzilla vs. Kong” and the airing of NCAA March Madness, the telco company revealed Thursday.

Additionally, AT&T says its WarnerMedia’s direct-to-consumer subscription revenue rose 35% year over year, and reported that 2.7 million domestic HBO and HBO Max subscribers had been added in Q1. That brings the total combined sub tally for HBO and HBO Max to 44.2 million U.S. subs and nearly 64 million globally.

For WarnerMedia, which includes Warner Bros., HBO, HBO Max, TBS, TNT, TruTV and CNN among its individual brands, revenues for Q1 of 2021 were $8.5 billion, up 9.8% from the year-ago period, a jump AT&T attributes to higher subscription, advertising and content sales, reflecting a “partial recovery” from the impact of the pandemic on last year’s results.

Subscription revenues were $3.8 billion, up 12.6%. Ad sales were $1.8 billion, up 18.5%, a result of the return of March Madness games. Content revenues totaled $3.4 billion (+3.5%), partially due to WarnerMedia’s decision to release its 2021 slate of films both theatrically and on HBO Max on the same day.

AT&T did not disclose its specific revenue from box office for the quarter in its financial results.

Wall Street had forecast earnings per share (EPS) of 78 cents on $42.69 billion in revenue, according to a consensus estimate compiled by Yahoo Finance. AT&T reported EPS of 84 cents on $43.9 billion in revenue, with that revenue result up 2.7% from Q1 2020.

The company’s net income for the quarter was $7.5 billion versus $4.6 billion in that same quarter last year.

“We continued to excel in growing customer relationships in our market focus areas of mobility, fiber and HBO Max,” AT&T CEO said John Stankey said in a statement prepared to accompany the financials. “We had another strong quarter of postpaid phone net adds, higher gross adds, lower churn and good growth in Mobility EBITDA. We also continue to increase penetration in markets where we offer fiber broadband and we’re moving quickly to deploy more fiber. HBO Max continued to deliver strong subscriber and revenue growth in advance of our international and AVOD launches planned for June.”

AT&T executives will host a conference call at 8:30 a.m. ET to discuss the quarter in greater detail.

Company stock closed Wednesday at $30.11 per share.

More to come…

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