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AT&T Reports Sluggish Q3 Results On Eve Of Time Warner Deal Close

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AT&T, which will soon officially absorb Time Warner to become a Hollywood heavyweight, reported mixed results for its last quarter before the expected close of the $85 billion megadeal, slightly undershooting Wall Street estimates.

In the period ending September 30, earnings per share came in at 74 cents a share, a penny below estimates, with total revenue at $39.7 billion, down 2% from $40.9 billion a year ago. The company blamed the downturn on “declines in legacy wireline services and consumer mobility.”

AT&T, which warned earlier this month that extreme weather eroded video subscriber numbers, said it added 296,000 new subscribers to its internet-delivered TV bundle DirecTV Now. That gain did not offset the 385,000 lost subscribers to U-verse wireline cable and DirecTV. In recent months, AT&T has drawn raised eyebrows on Wall Street for its promotional campaign encouraging existing DirecTV subscribers to consider switching to DirecTV Now, which has a much lower price point and no annual contracts, meaning churn is likely to remain high.

Shares dropped a point for the day to close at $34.88.

Company executives are set to discuss the quarterly results shortly with analysts during a conference call.

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