DALLAS—HBO Max ended 2020 on a high note, as AT&T shares that the streaming service doubled its activations between the end of the third quarter and fourth quarter of 2020 to a total of 17.2 million. However, that was not enough to prevent AT&T from experiencing a loss in total revenue for the final quarter of 2020, per the company’s full Q4 financial report.
HBO Max, which launched in May of 2020, has been struggling to make a dent in the streaming market, particularly compared to the rapid growth of Disney+. In an effort to boost subscriber numbers, WarnerMedia announced that it would release the anticipated “Wonder Woman 1984” on HBO Max the same day as in theaters, Dec. 25, 2020. It was later announced that all of Warner Bros. 2021 movies would follow the same strategy.
This announcement helped fuel a fourth quarter surge in active subscribers, totaling 17.2 million for HBO Max. At the end of 2020, total domestic HBO Max and HBO subscribers were at 41 million, a level that AT&T CEO John Stankey said was two years ahead of schedule.
However, those 17.2 million active subscribers to HBO Max still trail the major streaming players, including Netflix, which hit 203 million subscribers at the end of 2020, and Disney+, which in little more than a year has surpassed 86 million subscribers.
TV Tech's sister publication Next|TV reported that Stankey said that a reduced price, AVOD version of HBO Max (opens in new tab) is being eyed for a second quarter 2021 launch.
Elsewhere in AT&T’s video offerings, the company reports that it lost 617,000 TV subscribers, but that AT&T TV gains helped mitigate the loss.
In terms of dollars and cents, AT&T has reported a net loss of $13.9 billion. It’s overall revenue dropped 2.4% from $46.8 billion in Q4 2019 to $45.7 billion in Q4 2020.
Looking closely at individual sectors, HBO revenue rose 11.7% to $1.9 billion, but expenses were also up $18 billion (48.6%). HBO’s operating income fell to $86 billion from $481 million year-over-year, as the company invested in HBO Max.
Turner’s revenue for Q4 2020 was flat, with subscription revenue rising but advertising dropping, in large part because of the delayed start to the NBA season. In addition, lower ad revenue on TNT and TBS were partially offset by higher ratings on CNN, due in large part to the election.
Video subscribers revenue was down 11.2%, totaling $7.2 billion.
Warner Bros. operating income fell 17% to $791 million, with revenue also dipping to $3.2 billion (down 21.2%). This was a result of delayed theatrical releases and lack of a box office, as well as delayed TV productions because of the COVID-19 pandemic.
The full AT&T Q4 2020 financial results are available online (opens in new tab).
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