In hindsight, AT&T’s Time Warner acquisition looks pretty good.
The business, now renamed WarnerMedia, gave AT&T a few things to crow about, in its fourth-quarter earnings released Wednesday. They include WarnerMedia’s operating income growth of 33.2 percent, a popular slate of films like the blockbuster Aquaman and strong digital subscriber growth for HBO.
Offsetting that positive news, however, were continued drags on AT&T’s legacy businesses. The company added only 134,000 phone customers on a post-paid basis, or people who pay their bills at the end of the month, in the fourth quarter. And in total, it actually added only 13,000 post-paid customers thanks to a loss of 410,000 customers with tablets and other connected computing devices after AT&T scaled back its promotions. The rate of customer turnover also increased from a year ago due to decreased promotional activity.
In comparison, Verizon on Tuesday posted in the fourth quarter.
On the video side, AT&T lost 391,000 traditional pay TV customers and 267,000 DirecTV Now customers.
DirecTV Now, the subscription streaming service, took a big hit after AT&T raised its prices, and the company said that essentially no customers are on discounted plans anymore.
The results underscore AT&T’s awkward lurch forward in the midst of transformation. The company wants to become an entertainment powerhouse, but also must keep an eye on its more traditional service business.
Its wireless business has struggled enough that the company has resorted to touting the broad deployment of 5G E service, which is not actual 5G but suggests a level of network superiority over other carriers that doesn’t exist. AT&T has said it’s.
For the period, the Dallas telecom giant said it posted a net profit of $4.9 billion, or 66 cents a share, compared with a year-earlier profit of $19 billion, or $3.08 per share, which was helped by the federal government’s tax reform. Excluding special items, the company posted adjusted earnings per share of 86 cents.
Revenue, meanwhile, was at $48 billion.
Analysts, on average, forecast earnings of 86 cents a share and revenue of $48.5 billion .
Sharers slipped 0.1 percent to $30.66 in pre-market trading.
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