AT&T CFO John Stephens says Warner Bros. has “a long history of working with talent” but Covid is a reality “We cannot change” – Deadline

John Stephens, the outgoing CFO of WarnerMedia, parent company AT&T, defended the company’s decision to release its 2021 movie slate simultaneously on HBO Max and in theaters and cited Warner Bros.’s age-old relationship. with Hollywood talent – some unhappy with this decision and the way it was communicated.

“We have been working with talent for a long time and we will continue to work with them. I think we have a reputation that goes [back] decades. The Warner Bros. studio in particular, it’s only decades and decades, almost a hundred years, ”he said at a virtual media conference on Tuesday, when asked about the risk of a talent drain to rival studios that have took a different approach.

“This is a unique situation,” he said, with the pandemic shutting down or theaters shrinking around the world “and we can’t change that, it’s just the reality. So we’re trying to move this system forward in a healthy way and use the great content that already exists. “

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The relationship with theaters is “an important relationship,” he said. “But there are challenges, so we’re trying to use these precious elements in the best possible way in coordination with the theaters, and with HBO Max, we feel happy to use it in the best possible way and see ourselves how. it happens. We are delighted with it. We are positive about it.

Stephens will retire in March after 28 years with the company. WarnerMedia Chief Financial Officer Pascal Desroches has been appointed to succeed him, effective April 1, and he serves as AT&T Senior Executive Vice President – Finance during the transition.

Stephens declined to offer an update on HBO Max subscriber counts ahead of fourth quarter results later this month, but told the Citi TMT West conference that the service is helping generate subscriptions to the unlimited plans. highest level of the telecommunications giant.

CEO John Stankey said in December that HBO Max had 12.6 activations. The goal by 2025 is 50 million submarines in the United States and 75 to 90 million worldwide.

Some on Wall Street have been skeptical of AT & T’s foray into entertainment with the Time Warner acquisition adding a lot of debt. In an online survey of Citi conference attendees, asking if they think vertical integration will help drive future revenue growth, 48% were neutral, 28% negative and 25% positive. But Stephens described the company as, in a sense, focused on monthly subscriptions and growing customer relationships, and that HBO Max and WarnerMedia are now part of it.

AT&T shares fell about 25% in 2020, underperforming much of the entertainment space. Stephens touted its huge cash flow – estimated at $ 26 billion last year – and good dividends, and said the debt had to be put in context. The company has sold assets (Central European Media, Crunchyroll and continuing speculation on DirecTV) and has been extremely active in its debt management, aggressively refinancing at interest rates “below what they were” ten years ago”.

“What we’ve seen is really significant progress in managing the balance sheet… which is often underestimated,” Stephens said.

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