WarnerMedia is likely to delay the roll-out of its streaming service HBO Max in Europe, as it focuses efforts on Latin America.
The news came as WarnerMedia parent AT&T announced its Q2 results, revealing that HBO Max and its linear counterpart now have a total of 67.5 million subscribers worldwide, with 47 million of that total residing in the US.
With the vast majority of those additions coming from the US, the news will serve as a boost to AT&T following Netflix’s reveal that it lost 430,000 US subscribers in the second quarter.
WarnerMedia, which is in the midst of merging with factual giant Discovery, has also upped its growth expectations for the year to 70-73 million subscribers, up from a previous estimate of 67-70 million.
Pascal Desroches, WarnerMedia’s CFO, said the company was “seeing good momentum, especially in our Latin American markets” and added that it expected most of its subscriber growth for the remainder of the year to be “from lower ARPU subscribers in that region.”
He added that the company is “roughly about a third of the way through” transitioning its existing LATAM subscribers to HBO Max.
The exec also revealed that “to lean into HBO Max’s fast start in Latin America, we may push back our launch in some European markets until early 2022.”
The company had said in March that it was aiming to roll out HBO Max to 60 countries by the end of 2021, including 21 in Europe.
While the European expansion of HBO Max may now be pushed back, AT&T CEO John Stankey said that the plans to spin off its media assets in a standalone company with Discovery are “underway” while “there’s nothing we see that’s been particularly problematic.”
The CEO did not give any further details on when the deal will be concluded, but said “I think where we are on the Discovery process is no news is good news.”
AT&T also revealed that it added 246,000 new fibre subscribers during the quarter, up from 225,000 in Q2 2020. It also added 789,000 new phone subscribers, which represents a dramatic increase on Wall Street estimates of under 300,000.
Overall, AT&T’s consolidated revenues for the second quarter totalled $44bn versus $41bn in the year-ago quarter, up 7.6%. Operating income was $3.3bn versus $3.5bn in the year-ago quarter due to higher impairments at Vrio – the Latin American pay TV unit it has just agreed to sell.