HBO And HBO Max Add 2.7M Subscribers In Q1, AT&T Reports As It Beats Wall Street Earnings Expectations

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On a combined basis, HBO and HBO Max added 2.7 subscribers in the first quarter, WarnerMedia parent AT&T reported.

The solid returns on streaming helped the telco and media giant beat Wall Street expectations in the quarter. Adjusted earnings of 86 cents a share rose 2% and beat analysts’ consensus forecast of 86 cents.

Total revenue hit $43.9 billion, up almost 3% and ahead of the Street number.

HBO Max, the nearly year-old streaming service available at no extra cost to HBO subscribers, propelled the overall HBO number to 44.2 million subscribers. Average revenue per user was $11.72.

Last year, WarnerMedia decided to give HBO Max additional ammunition by putting Warner Bros movies on the service at the same time they debut in theaters. The release approach, which stunned Hollywood, will hold true for the entire 2021 slate. Management has explained it as a response to theater shutdowns during the coronavirus pandemic.

WarnerMedia reported a 10% gain in overall revenue, to $8.5 billion, which AT&T said reflects a “partial recovery” from the worst of Covid-19. Advertising revenue popped 18.5% due to the return of the NCAA Men’s Basketball Tournament, which the pandemic completely wiped out in 2020.

In previous quarters, AT&T had reported an “activations” number for HBO Max — in the fourth quarter of 2020 it was 17.2 — indicating how many HBO customers turned on their streaming subscriptions. It is now planning to report a combined number each quarter, which is in line with the goals it has set out for HBO Max. Globally, HBO and HBO Max reached 63.9 million subscribers.

Earlier this year, AT&T raised its forecasts for HBO Max, saying it expects 120 million to 150 million global subscribers by 2025, half of them in the U.S. The international rollout is set to begin in June, at the same time an ad-supported tier launches. The current, ad-free version will remain $15 a month for those without an HBO subscription, with expectations for the AVOD version to come in at or just below $10.

The company’s Mobility division reported 823,000 subscriber additions in the quarter, with revenue up 9%.

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