AT&T bows out of entertainment business with 77 million HBO subscribers

In its final quarter of owning WarnerMedia, AT&T reported positive performance of HBO and its big-budget streaming counterpart HBO Max.

The brand added 3 million subscribers in Q1, to reach a total of 76.8 million. This represented a year-over-year increase of 12.8 million, in part thanks to the company’s controversial decision to release its 2021 theatrical slate including Dune and The Matrix Resurrections day-and-date on the streamer.

Of that 3 million increase, 1.8 million adds came from the US market, with the streamer becoming a larger international entity as it continues its expansion. 

HBO Max’s continued growth stands in stark contrast to Netflix, which last week announced its first subscriber losses since 2011.

In its final quarter of existence, WarnerMedia – now merged with Discovery as Warner Bros. Discovery – recorded revenues of US$8.7 billion, up 2.5% year-over-year, with subscription revenues up 4.4% to US$4 billion. Ad revenue meanwhile dipped 3% year-over-year to US$1.7 billion. 

Warner’s operating revenues were down 32.7% at $1.3 billion, due to continued investments in streaming.

Speaking to investors, AT&T CEO John Stankey declared a “new era” for the telco as it exits the entertainment space six years after it agreed a US$85.4 billion deal to buy Time Warner.

Stankey also praised the benefits of the US$43 billion Warner-Discovery merger, saying that it is unloading some of its astronomical debt while also getting more than US$40 billion to help pay off further debt.

The financial report was released prior to the shock news that Warner Bros. Discovery is to shutter news streamer CNN+ after just one month. CNN CEO Chris Licht blamed “prior leadership” that “decided to just keep going” when it was made clear that Discovery execs intended on consolidating the overarching company’s SVOD products.