DIRECTV up 323k; U-Verse down 326k; DTVLA down 48k subscribers in 3Q 2016

DALLAS — AT&T Inc. (NYSE:T) today reported growing revenues and net income with solid margins and earnings for the third quarter.

Entertainment Group

Total video subscribers were essentially flat in the quarter as competition increases. The company added 323,000 satellite subscribers in the third quarter. U-verse TV subscribers declined 326,000 as the company continued to focus on profitability and increasingly emphasized satellite sales. For the second straight quarter, gross additions increased on a year-over-year basis even when excluding IPTV customers transitioning to DIRECTV.

The Entertainment Group ended the quarter with 25.3 million video subscribers. While the company expects positive video net adds in the fourth quarter, it expects total video net adds for the year to decline slightly. At the end of the third quarter, about 100,000 pending video customers had the capability to watch TV on their mobile devices; however, these customers were not included in third-quarter subscriber numbers since the video service had not yet been installed at their homes.

Video (in thousands)

             12/31/14   3/31/15   6/30/15   9/30/15  12/31/15   3/31/16   6/30/16   9/30/16
             --------  --------  --------  --------  --------  --------  --------  --------
Connections
 U-verse        5,943     5,993     5,971     5,880     5,640     5,232     4,841     4,515
 DIRECTV            -         -         -    19,570    19,784    20,112    20,454    20,777
Total           5,943     5,993     5,971    25,450    25,424    25,344    25,295    25,292

Additions
 U-verse         -124        50       -22      (91)     (240)     (382)     (391)     (326)
 DIRECTV            -         -         -        26       214       328       342       323
Total              73        50      (22)      (65)      (26)      (54)      (49)       (3)

International – DIRECTV Latin America

AT&T is a leading provider of pay television services in Latin America with satellite operations serving Argentina, Brazil, Chile, Colombia, Ecuador, Peru, Uruguay, Venezuela and parts of the Caribbean. It also owns 41% of Sky Mexico. Sky Mexico financial results are accounted for as an equity method investment.

Third-quarter subscriber net losses were 48,000, driven by declines in Colombia, Argentina and Brazil. Total subscribers at the end of the quarter were 12.5 million. Sky Mexico had approximately 7.8 million subscribers as of June 30, 2016.

Video (in thousands)

                  9/30/15  12/31/15   3/31/16   6/30/16   9/30/16
                 --------  --------  --------  --------  --------
Connections                        
 Brazil             5,538     5,444     5,342     5,348     5,337
 Other Countries    7,006     7,066     7,094     7,175     7,139
Total              12,544    12,510    12,436    12,523    12,476
                        
Additions                        
 Brazil             (129)      (94)     (101)         6      (12)
 Other Countries       16        60        28        81      (36)
Total               (113)      (34)      (73)        87      (48)