AT&T Reports First-Quarter Results

AT&T Inc. (NYSE:T) reported first-quarter results that showed continuing customer growth in wireless, fiber and HBO Max and strong cash flows.

“We continued to excel in growing customer relationships in our market focus areas of mobility, fiber and HBO Max,” said John Stankey, AT&T CEO. “We had another strong quarter of postpaid phone net adds, higher gross adds, lower churn and good growth in Mobility EBITDA. We also continue to increase penetration in markets where we offer fiber broadband and we’re moving quickly to deploy more fiber. HBO Max continued to deliver strong subscriber and revenue growth in advance of our international and AVOD launches planned for June.”

First-Quarter Highlights

Communications

• Mobility:
  • 595,000 postpaid phone net adds
  • 823,000 postpaid net adds
  • 207,000 prepaid phone net adds
  • Postpaid phone churn of 0.76%
  • Revenues up 9.4%; service revenues up 0.6%; equipment revenues up 45.2%
  • Operating income of $6.0 billion, up 3.7% year over year; EBITDA⁴ up 2.3%
  • Operating income margin of 31.5%; EBITDA service margin⁵ 57.1% compared to 56.1% in the year-ago quarter

• Consumer Wireline:
  • 235,000 AT&T Fiber net adds; penetration more than 35%, up about 600 basis points
  • IP broadband revenues up 4.6% with ARPU growth of 3.2%

WarnerMedia

• 2.7 million total domestic HBO Max and HBO subscriber⁶ net adds; total domestic subscribers of 44.2 million and nearly 64 million⁷ globally
• Domestic HBO Max and HBO ARPU⁸ of $11.72
• Direct-to-Consumer subscription revenues up about 35%
• Total revenues up 9.8% to $8.5 billion

Consolidated Financial Results

(Video results are now included in Corporate & Other as the business is classified as held-for-sale. Additional information about the Video business is provided as part of the earnings material on the company’s Investor Relations website.)

Consolidated revenues for the first quarter totaled $43.9 billion versus $42.8 billion in the year-ago quarter, up 2.7%. Higher Mobility revenues, primarily from equipment sales, and higher WarnerMedia revenues more than offset declines in domestic video, business wireline and Latin America, which includes foreign exchange pressure. Additionally, consolidated revenues were impacted by the fourth-quarter 2020 sale of our previously held-for-sale wireless and wireline operations in Puerto Rico and the U.S. Virgin Islands.

Operating expenses were $36.3 billion versus $35.3 billion in the year-ago quarter. Expenses increased due to higher domestic wireless equ