AT&T just posted its results for the fourth quarter 2019 . . . and things could have been better. Overall, the company took in $46.82 billion in revenue, which was below the $46.96 billion the street was expecting. As Variety points out, $46.82 billion is 2.4% below what AT&T previously posted.
So why did AT&T’s Q4 disappoint? Much of the blame can be put on its WarnerMedia subsidiary, which includes HBO, Warner Bros, and Turner. Q4 WarnerMedia revenue fell 3.3% to $8.9 billion and operating income declined 9.5% to $2.4 billion. As Variety points out, much of that fall resulted from WarnerMedia losing licensing revenue from its movies and TV shows it pulled from various streaming services.
It pulled that content so it can get ready to bring it over to the new HBO Max streaming service, which is expected to launch in May. In total, the pulling of that content, including Friends from Netflix, cost WarnerMedia $1.2 billion in lost licensing revenue.
DirecTV was also responsible for AT&T’s underwhelming quarter. It suffered a net loss of 945,000 subscribers. The AT&T TV Now service didn’t do much better, losing 219,000 subscribers.
Announcing AT&T’s latest numbers, Randall Stephenson, AT&T chairman and CEO, said, “We delivered what we promised in 2019 and we begin this year with strong momentum in wireless, with HBO Max set to launch in May and our share retirement plan well underway.”