AT&T earnings: Revenue drops

March Madness cancellation hits WarnerMedia

AT&T earnings: Revenue drops
  • Q1 revenue: $42.8 billion (-4.6% YoY, -8.6% QoQ, vs. $44.2 billion expected)
  • Q1 earnings: $4.69 billion (+14.1% YoY, +96% QoQ, in line with expectations)
  • Q2 guidance: Withdrawn, "due to the lack of visibility related to COVID-19 pandemic and recovery."

The big number: AT&T added 163,000 net new monthly phone subscribers last quarter, well ahead of the 90,700 analysts expected. But it lost 897,000 premium video subscribers.

People are talking: "None of us can predict exactly what's going to happen in the remainder of the year," said CFO John Stephens.

Opportunities: CEO Randall Stephenson told analysts that the crisis has demonstrated how important telecoms are to society, and said he hopes policymakers realize that after the crisis. Just as Big Tech is seeing a change in sentiment as a result of its crisis response, so could the telecoms sector.

Threats: Though AT&T has seen increased demand for its services, it's struggling to monetize that: Mobility revenue was up just 2.5% year over year. The company said it took a hit from a lack of roaming fees as well as its decision to waive late fees. That could lead to increased loyalty later down the line, though.

The power struggle: WarnerMedia saw a $1 billion year-over-year drop in revenue, thanks to lower advertising revenue from the cancellation of the NCAA's March Madness and weaker theatrical performance. Profit margins also worsened, which AT&T attributed to investment in HBO Max. The streaming service launches next month, and AT&T will hope it can make up for losses elsewhere: Executives suggested they'll increasingly look to move theatrical releases to the new service.

Protocol | Workplace

Microsoft Teams is going after small businesses

Microsoft Teams Essentials offers longer, bigger meetings for a relatively small price tag.

Companies can now buy a standalone version of Teams.

Photo: Mika Baumeister/Unsplash

Microsoft announced today that companies can now buy a standalone version of Teams — one of its most important products and a major player in work messaging and video chat, alongside Slack and Zoom. The product, called Microsoft Teams Essentials, aims to give small or medium-sized businesses a communication hub that costs less than its competitors'.

Microsoft will charge small businesses $4 per user per month for Microsoft Teams Essentials, while Zoom’s cheapest paid plan is $14.99 per user per month and Slack’s is $6.67 per user each month, when billed annually. The free version of Microsoft Teams still exists, as do the various other Microsoft 365 plans that include Teams. Teams Essentials offers longer meeting times, larger group meetings and more cloud storage.

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Lizzy Lawrence

Lizzy Lawrence ( @LizzyLaw_) is a reporter at Protocol, covering tools and productivity in the workplace. She's a recent graduate of the University of Michigan, where she studied sociology and international studies. She served as editor in chief of The Michigan Daily, her school's independent newspaper. She's based in D.C., and can be reached at llawrence@protocol.com.

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Bob Schukai
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Protocol | Policy

5 things to know about NTIA nominee Alan Davidson

If confirmed, the former Googler will play a key role in shaping the unprecedented expansion of broadband across the country.

Alan Davidson has been nominated to lead the NTIA.

Photo: Win McNamee/Getty Images

On Wednesday, the Senate Commerce Committee is holding a hearing to confirm President Joe Biden’s nominee to lead the National Telecommunications and Information Administration — a traditionally somewhat-sleepy role that is taking on new prominence in the wake of the passage of the bipartisan infrastructure bill.

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Protocol | Enterprise

Meta is tapping AWS for its cloud expansion and AI collaboration

Well, presumably it has to put all those metaverse acquisitions somewhere.

Meta built an impressive array of its own data centers over the last decade, but now plans to use AWS more in the future.

Image: Meta

The company formerly known as Facebook built an impressive array of computing infrastructure over the last decade. Over the next 10 years, it plans to also draw on the cloud.

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Tom Krazit

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Protocol | Policy

Why tech foes are psyched the UK told Meta to sell Giphy

Meta’s enemies have long called for the company to be broken up. Now the U.K. has ordered Giphy spun off — and leapt into the kind of antitrust analysis that disturbs Big Tech.

U.S. tech skeptics see international competition enforcers taking aggressive action against companies.

Photo: Jakub Porzycki/NurPhoto via Getty Images

Big Tech foes in the U.S. woke up this week feeling a little envious of the United Kingdom: On Tuesday, the U.K.’s Competition and Markets Authority ordered Meta, formerly known as Facebook, to sell Giphy to address concerns about the impact of the deal on competition.

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Ben Brody

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