AT&T US down 627k; Vrio down 32k video subs in 1Q 2019

Wednesday, April 24th, 2019 
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AT&T Reports First-Quarter Results

DALLAS — AT&T Inc. (NYSE:T) reported solid Mobility and WarnerMedia results in the first quarter, including wireless service revenue growth and postpaid phone net adds, and grew operating income and EBITDA in the Entertainment Group.

Entertainment Group

Entertainment Group provides video, including over-the-top (OTT) services, broadband and voice communication services primarily to residential customers. This business unit also sells advertising on video distribution platforms

Revenues

$11.3 billion, down 0.9% year over year due to declines in TV subscribers and legacy services

  • Video: $8.1 billion, down 1.8% year over year due to declines in premium TV subscribers and an allocation adjustment for bundled discounts partially offset by the growth of over-the-top revenues

Subscriber Metrics

  • Total video subscribers: (627,000) net loss
  • Premium TV subscribers: (544,000) net loss due to an increase in customers rolling off promotional discounts, competition and lower gross adds due to a focus on long-term value customer base
  • DIRECTV NOW subscribers: (83,000) net loss as the company scaled back promotions

Video (in thousands)

                                                                           Three Months Ended
               ------------------------------------------------------------------------------
                6/30/17   9/30/17  12/31/17   3/31/18   6/30/18   9/30/18  12/31/18   3/31/19
               --------  --------  --------  --------  --------  --------  --------  --------
Connections
  Satellite      20,856    20,605    20,458    20,270    19,984    19,625    19,222
  U-verse         3,825     3,691     3,631     3,632     3,656     3,669     3,681
               --------  --------  --------  --------  --------  --------  --------  --------
 Premium TV      24,681    24,296    24,089    23,902    23,640    23,294    22,903    22,359
 DIRECTV NOW        491       787     1,155     1,467     1,809     1,858     1,591     1,508
               --------  --------  --------  --------  --------  --------  --------  --------
Total            25,172    25,083    25,244    25,369    25,449    25,152    24,494    23,867

Net Adds                  
  Satellite        -156      -251      -147      -188      -286      -359      -403
  U-verse          -195      -134       -60         1        24        13        12
               --------  --------  --------  --------  --------  --------  --------  --------
 Premium TV        -351      -385      -207      -187      -262      -346      -391      -544
 DIRECTV NOW        152       296       368       312       342        49      -267       -83
               --------  --------  --------  --------  --------  --------  --------  --------
Total              -199       -89       161       125        80      -297      -658      -627

Latin America

The Latin America segment provides entertainment and wireless service outside of the U.S. The Latin America segment contains two business units: Vrio and Mexico. Vrio provides entertainment services to customers utilizing satellite technology in Latin America and the Caribbean. Mexico provides wireless services and equipment to customers in Mexico.

Revenues

$1.7 billion, down 15.2% year over year largely due to foreign exchange pressures from revenues in multiple currencies

Subscriber Metrics

  • Vrio – 32,000 net loss; total subscribers at the end of the quarter were 13.6 million

Sky Mexico, an equity method investment, had approximately 7.6 million subscribers as of December 31, 2018

Vrio Video (in thousands)

                                                                           Three Months Ended
               ------------------------------------------------------------------------------
                6/30/17   9/30/17  12/31/17   3/31/18   6/30/18   9/30/18  12/31/18   3/31/19
               --------  --------  --------  --------  --------  --------  --------  --------
Connections      13,622    13,490    13,629    13,573    13,713    13,640    13,838    13,584
Net Adds            -56      -132       139       -15       140       -73       198       -32

More: Earnings Release

Links: AT&T