AT&T Inc. (T) – Get report On Thursday, it posted stronger-than-expected second-quarter earnings, but saw a notable drop in WarnerMedia revenue when coronavirus closings hit the global entertainment industry.
AT&T said adjusted earnings for the three months ending June were set at 83 cents a share, 6.75% less than in the same period last year and 4 cents ahead of the Street consensus forecast. The group’s revenue, AT&T said, fell 8.9% from last year to $ 41 billion, just below analyst estimates of $ 41.1 billion.
AT&T said it had about 36 million registered customers for its recently launched HBO Max service (including HBO’s legacy subscribers) after adding about 3 million during the second quarter. However, postpaid mobile phone subscribers fell by 151,000 compared to the additions market forecast for a total of around 7,000.
“Our strong execution and focus in a challenging environment produced significant progress in the quarter, especially the successful launch of HBO Max, resilient free cash flow and a strong balance sheet,” said new CEO John Stankey. “Our cash from operations continues to support investments in growth areas, dividend payments, and debt retirement.”
“We are aggressively working on opportunities to sharpen our focus, transform our operations and continue to invest in growth areas, with the customer at the center of everything we do,” he added.
AT&T shares were marked 2.1% higher in pre-market trading immediately after the earnings announcement to indicate an opening bell price of $ 30.80 each, a move that would still leave stocks with an annual drop of around 21.5%.
Revenue for WarnerMedia, its entertainment division, fell 22.7% to $ 6.8 billion, as the coronavirus pandemic delayed movie production and shuttered movie theaters at home and around the world.
Stankey served as COO of WarnerMedia before being appointed to replace outgoing CEO Randall Stephenson in April this year, who left the group after thirteen years at the helm.
During his tenure, he guided the company through major acquisitions, such as the $ 49 billion purchase of DirecTV in 2014 and the $ 108.7 billion acquisition of WarnerMedia two years later.
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