Benefiting from the strong political season, AT&T Inc. registered an almost 7% gain in advertising revenues in the fourth quarter of 2020.
The company reported $1.97 billion in ad revenues from across its Turner properties, Xandr advanced advertising unit and local inventory via its video offerings. That compared to ad revenues of $1.85 billion in the fourth quarter of 2019.
A breakdown shows Turner, Warner Media LLC's TV networks business, registered a 1.3% year over year dip in ad revenues to $1.11 billion, primarily due to the pandemic-delayed start of the NBA season on TNT (US). Turner's ad revenues were also hampered by a downturn in domestic entertainment networks audience delivery, partially offset by higher news delivery during the general election.
In its video business, AT&T registered a 20.1% jump in ad revenue to $603 million in the quarter. Outgoing AT&T CFO John Stephens said on the company's Jan. 27 earnings call that advertising gains were driven by political advertising and CNN (US), which ranked first in all of cable viewership, not just news, in the fourth quarter.
Xandr registered a 22.1% rise to $741 million in ad revenue in the fourth quarter, while other advertising sources increased 5.2% to $122 million.
For the full year, AT&T's total advertising revenue was down 7.9% to $6.42 billion, reflecting declines in the first and second quarters tied to COVID-19.
During the fourth quarter, Warner Media posted a 9.5% drop in total revenues to $8.55 billion from $9.45 billion in the final 2019 reporting period. Operating profits were down 11.5% to $2.53 billion from $2.86 billion.
All told, Turner posted a 0.6% dip in fourth-quarter total operating revenues to $3.24 billion from $3.26 billion. A 5.8% decline in costs led to a 6.9% rise in Turner's quarterly operating profit to $1.36 billion. Turner subscription revenues edged up 1% to $1.92 billion, while its content and other revenues declined 10.2% to $211 million.
HBO's fourth-quarter revenues improved 11.7% to $1.90 billion, with subscription revenues ahead 17.9% to $1.69 billion. Content and other revenues were down 20.9% to $216 million. Operating expenses surged 48.6% to $1.82 billion in the quarter, reducing operating profits by 81.5% to only $87 million. During the fourth quarter, AT&T allocated some $800 million behind the rollout of streaming service HBO Max.
Warner Bros. registered declines across its three units, with total operating revenues off 21.2% to $3.25 billion from $4.12 billion. Operating costs declined 25.9% to $2.46 billion, as operating profits slid 2.9% to $771 million from $794 million.
Corporately, AT&T’s fourth-quarter total operating revenues declined 2.4% to $45.69 billion from $46.82 billion in the prior-year period.
The company reported a net loss attributable to common stock of $13.94 billion, or $1.95 per share, in the fourth quarter of 2020, compared to net income attributable to common stock of $2.39 billion, or 33 cents per share, in the prior-year period.
