AT&T sinks on vanishing video subs

AT&T’s stock got slammed Thursday after the telecom reported it lost 90,000 video subscribers in the third quarter.

The decline in video subscribers renewed industrywide fears of cord-cutting and drove down the shares of other paid-TVdistributors as well.

AT&T said it lost 390,000 traditional video subscribers but that 300,000 subscribers were added to DirecTV Now, its recently launched less-expensive streaming service, according to a regulatory filing.

“No one should have expected AT&T’s video subscriber results to be good,” MoffettNathanson analyst Craig Moffett said in an e-mail. “But we doubt anyone expected them to be this bad.”

Last month, Comcast said it expected to lose up to 150,000 video subscribers in the quarter.

“The issue is in the acceleration in cordcutting and the prevalence of [over-thetop],” Moffett wrote. “It is reasonable to expect a weak quarter for the whole pay-TVindustry.”

Investors reacted to AT&T’s numbers, contained in the unusual pre-announcement, by sending the stock down 6.1 percent, to $35.86.

The AT&T decline also weighed on other pay-TV companies, which are not only battling over-the-top competitors like Amazon, Hulu and Netflix but also competing with their ownskinny bundles.

Dish shares fell 5.1 percent, to $49.03, after touching a 52-week low in the session, Comcast declined 3.9 percent, to $35.95, Altice USAwasoff 2.8 percent, to $25.15, after it, too, hit a 52-weeklowin the session, and Charter gave up 2.6 percent, to $355.71.

Investors will have to wait two weeks to get the full extent of the quarter’s weakness. AT&T is scheduled to report its results on Oct. 24, followed by Comcast on Oct. 26.