HBO Max is riding a boost in subscribers thanks to a pivotal distribution deal with Roku and hosting the premiere of “Wonder Woman 1984,” Bloomberg reports.
Numbers To Consider:
- Roughly 17.2 million people activated their HBO Max accounts at the end of Q4.
- That’s double the 8.6 million at the end of Q3 and 4.1 million after its first month in operation.
It seems like the bottleneck came down to two things. HBO Max resolved a dispute with Roku that had prevented the streaming service from appearing on the latter’s devices. It potentially unlocked millions of new subscribers. As the pandemic also pushes movies out of theaters and directly to streaming, HBO Max led the way with the new Wonder Woman film being released on its platform.
On a broader note, the decision to send films straight to streaming “has sparked an uproar in Hollywood, because it upends how people in the industry get paid.”
- AT&T’s WarnerMedia plans to continue premiering films on HBO Max as theaters remain restricted by Covid-19.
- In the end, it could be a growth accelerator for HBO Max.
The Long-Term Outlook: AT&T wants HBO Max to hit 50 million U.S. subscribers by 2025. It also intends to reach a worldwide total of between 75 million and 90 million subscribers in that same time frame.
- Part of the plan includes expanding outside the U.S. and offering a lower-cost version with advertising enabled.
AT&T ($T) posted strong growth in its Mobile and Internet. As expected, AT&T saw declines in its traditional Pay TV, legacy Business Wireline and Business Solutions business.
It’s also clearly struggling with its WarnerMedia business due to pandemic-related hits to Movies and TV production. HBO was a bright spot, growing 12% year-over-year. What I really like to see is that HBO Max subscribers have doubled in just a quarter.
$T is trading flat for the day on the news despite the 2.5% revenue and 1.7% Adjusted EBITDA beat. If you’re a ROIC member, definitely go read my AT&T write-up here for my long-term analysis and prediction.