AT&T said its their-quarter earnings got a substantial boost from its acquisition of Time Warner, with the new WarnerMedia unit added about 5 cents a share to the company’s profits.
AT&T’s net income was $4.7 billion, or 65 cents per share, up from $3 billion or 49 cents a share, a year ago. The earnings include 25 cents for the cost of amortization, merger-and integrated related expenses.
Revenues rose 15.3% to $45.7 billion, primarily due to the acquisition of Time Warner and despite declines in domestic video and legacy wireline services..
At WarnerMedia earnings before interest, taxes, depreciation and amortization were up 7.1% to $2.7 billion, Revenue rose 6.5% to $8.2 billion.
WarnerMedia’s subscription revenue growth was about 7%, with a 5.6% increase at Turner and a 7% gain at HBO.
Turner’s advertising revenue was down 3.7%, or 3% excluding foreign exchange effects.
Advertising revenues for its newly named Xandr advertising unit were up 34%, or 22% excluding the acquisition of AppNexus.
The company said it added 49,000 low-priced digital DirecTV Now subscribers. But it lost 346,000 traditional DirecTV subscribers.
“I’m pleased with the progress we made on a number of fronts in the third quarter,” said Randall Stephenson, AT&T chairman and CEO. “Our U.S. wireless business is growing and it’s the single biggest contributor to our earnings and cash flow. WarnerMedia was immediately accretive in its first full quarter, contributing 5 cents to EPS, and our free cash flow grew by double digits.”
“As we’re nearing completion of our fiber build and making pricing moves on video, we’re laying the foundation for stabilizing our Entertainment Group profitability in 2019,” Stephenson added. “Across the business, I like our momentum and feel confident that we’re on track to deliver on our plans.”