HBO Max US subs fall but global take up rises | Major Businesses | Business | News | Rapid TV News
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ATT division WarnerMedia has reported a generally strong third quarter of 2021, showing the company recovering from falls attributable to Covid, especially in its HBO Max direct-to-consumer line but indications are that the DTC line is slowing in the US just as its global sales rise.
HBOMax 28May2020
Overall for the third quarter ended 30 September 2021, WarnerMedia posted revenues of $8.4 billion, up 14.2% compared with the same quarter a year ago, driven by higher content and other revenues, including the partial recovery from prior-year impacts of the pandemic and higher subscription revenues, partially offset by lower advertising revenues.

Subscription revenues were $4.0 billion, up 14.7%, primarily reflecting said the company the growth of the HBO Max direct-to-consumer service. Content and Other revenues were $3.1 billion, up 31.7%, driven by higher TV licensing and higher theatrical, while advertising revenues were $1.4 billion, down 12.4% when compared to the prior year due to timing of the NBA season in the year-ago quarter and lower political ad spending year over year.

On the downside, operating expenses increased 13.8% when compared with the third quarter of 2020 to total $6.4 billion, up riven by higher film and non-sports programming costs, as well as higher marketing costs, and incremental selling costs associated with advertising revenue sharing arrangements in the DIRECTV business line. These increases were partially offset by lower sports programming costs from the timing of the NBA season in the prior-year quarter.

Looking at uptake of the key HBO Max DTC service, at the end of the quarter, there were 69.4 million global HBO Max and HBO subscribers. Global HBO Max and HBO subscribers increased 12.5 million on a year-on-year basis and were up 1.9 million sequentially, as international and ad-supported subscriber gains were partially offset by HBO Max being discontinued on the Amazon Channels wholesale platform. At the end of the quarter, there were 45.2 million US HBO Max and HBO subscribers, compared with 38.0 million in the year-ago quarter, Domestic subscriber ARPU was $11.82. Yet US subscribership fell, however, by 1.8 million on a quarter-by-quarter basis die to the removal from Amazon. These were offset by gains in global business.

The third quarter results also showed
that operating contribution was $1.9 billion, up 10.3% on an annual basis, while operating income was $2.0 billion, up 15.2% year over year, as higher revenues and lower sports programming costs were partially offset by continued HBO Max investment and incremental advertising revenue sharing costs. Operating income margin was 23.8%, compared with 23.6% in the year-ago quarter.