AT&T reported lower-than-expected quarterly results on Wednesday as continuing losses of premium TV subscribers outweighed growth in its wireless phone business.

For the first quarter, the company earned an adjusted 84 cents per share as revenue fell 4% to $42.8 billion. Analysts had expected earnings of 85 cents per share on revenue of $44.2 billion.

CEO Randall Stephenson said the coronavirus pandemic had a 5 cents per share impact on earnings. “Without it, the quarter was about what we expected — strong wireless numbers that covered the HBO Max investment, and produced stable Ebitda and Ebitda margins,” he said in a news release.

The company attributed a $600 million decline in revenue to lost advertising sales resulting from the postponement of live sports such as March Madness and to lower wireless equipment sales.

But as Ars Technica reports, the first-quarter results showed that AT&T’s “string of massive [premium TV] customer losses” is continuing, with traditional pay TV services, including DIRECTV and the newer streaming option AT&T TV, sseeing a combined net loss of 897,000 subscribers.

AT&T ended the quarter with 18.6 million pay TV subscribers, down from 19.5 million in the fourth quarter when it lost 945,000 subscribers.

“AT&T’s Q1 TV subscriber numbers indicate how quickly the pay TV market is imploding,” TechCrunch said, adding that “This all puts much more pressure on WarnerMedia to deliver with its May 27th launch of HBO Max.”

On the wireless side, AT&T brought in $14 billion in revenue, ahead of analysts’ estimates. The company added 163,000 postpaid wireless phone customers while gaining a net 27,000 overall postpaid subscribers.

“AT&T’s mix of businesses leaves it in relatively stable shape with COVID-19-driven margin benefits in wireless offsetting much of the pressure in Warner Media, Entertainment, and elsewhere,” New Street Research analyst Jonathan Chaplin wrote in a client note.

However, he added, “The prognosis for the rest of the year is grim: some of the benefits in wireless will likely unwind, while revenue trends and margins in Entertainment and Warner Media will likely get worse.”

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