AT&T Lost TV Subs In Q2, But Still Beat Analysts' Earnings Expectations

Xavier Trudeau
Juillet 26, 2017

AT&T posted second-quarter earnings excluding some items of 79 cents a share, more than the 74 cents analysts predicted.

AT&T's stock was up almost 3 percent after the announcement.

AT&T turned in consolidated Q2 revenues of $39.8 billion, down from $40.5 billion a year earlier due to declines in its legacy wireline services and consumer mobility. The total was lower, therefore better, than Wall Street's expectation of 1.19 percent, according to StreetAccount.

AT&T added 152,000 DirecTV Now subscribers in Q2, but that was not almost enough to offset losses from DirecTV's satellite TV business or AT&T's managed IPTV service, U-verse TV. The total number of video subscribers was essentially flat from previous year, the company said.

Looking forward to full year 2017, AT&T maintained its guidance of adjusted earnings growth in the mid-single digit range. The move comes amid "cord cutting", or households shunning traditional cable packages and opting instead of digital services like Netflix (NFLX).

Despite President Trump promising he'd block the deal, AT&T and Time Warner have started talking with the Department of Justice on potential conditions for their megamerger.

In the brief AT&T also said that the firm expects to close its Time Warner merger by the end of the year.

AT&T said about 60% of its broadband subs get speeds of between 18 Mbps to 1 Gbps, and that the number of subs with speeds of 18 Mbps more has risen by 1.6 million in the past year.

A group of senators, mostly Democrats, last month urged regulators to block the deal in a letter to Attorney General Jeff Sessions, claiming "the combined company's unmatched control of popular content and the distribution of that content will lead to higher prices, fewer choices, and poorer quality services for Americans".

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