(Reuters) – AT&T Inc beat market estimates for fourth-quarter revenue, bolstered by strong growth from Warner Media and its streaming platform HBO Max as consumers chose to remain indoors amid a surge in the coronavirus pandemic cases.
The pandemic-triggered shift to working, studying and playing online has sustained a strong demand for AT&T’s wireless services while a larger shift to streaming platforms for entertainment has helped the company rake in more customers for HBO Max during the quarter.
Revenue at Warner Media, which houses HBO and HBO Max streaming service, rose 15.4% to $9.9 billion in the quarter, helping offset some weakness at wireless services, as the company added lesser than expected subscribers who pay a monthly bill.
The company only added 884,000 net new phone subscribers who pay a monthly bill during the fourth quarter, falling short of FactSet estimates of 906,500 new subscribers.
Rival carrier Verizon, which added 558,000 subscribers in its latest quarter, beat estimates.
Premium TV channel HBO and streaming service HBO Max had steady growth as they added 4.4 million subscribers during the quarter, drawing viewers with releases such as “Dune”, “The Matrix” and the newest season of “Succession” in the quarter.
Total consolidated revenue was $41.0 billion in the quarter ended Dec. 31, beating analysts’ estimates of $40.44 billion, according to Refinitiv Data.
AT&T’s fourth-quarter net income swung to a profit of $5.0 billion, or $0.69 per share, from a loss of $13.9 billion, or $1.95 per share, last year.
Including WarnerMedia and Xandr, AT&T now expects 2022 revenue growth in low-single-digits range.
The company said it expects annual adjusted earnings to be between $3.10 and $3.15 per share in 2022, falling short of analysts’ average estimate of $3.21.
AT&T is facing fierce competition from rivals Verizon and T-Mobile US amid nationwide deployment of their 5G technology. The company also forecast 2022 capital expenditure in the $20 billion range.
(Reporting by Richard Rohan Francis and Chavi Mehta in Bengaluru and Sheila Dang in Dallas; Editing by Krishna Chandra Eluri)
