DALLAS _ AT&T beat analysts' expectations and signed up new pay-TV customers for the first time in seven quarters with its new online video streaming service, DirecTV Now.
The streaming service offers a lineup that's similar to cable TV but doesn't require a cable box, satellite dish or annual contract. The Dallas-based company reported that at least 200,000 video subscribers signed up in the fourth quarter, according to a Friday filing with the Securities and Exchange Commission. Analysts were expecting 61,000, according to a Bloomberg report.
An AT&T spokesman declined to comment.
AT&T launched the new service in late November and pushed a promotional offer for early subscribers of $35 a month for 100-plus channels. That same channel lineup is now $60 a month.
AT&T is the largest pay-TV provider in the U.S. with more than 25 million subscribers but it faces a more competitive and fragmented TV landscape. Cable and satellite subscribers are on the decline. The company must fend off new rivals like Netflix, Amazon and Hulu.
AT&T's answer is its own video streaming service: DirecTV Now. The streaming service includes a more traditional cable lineup but is missing the CBS network and features such as DVR. Customers must pay extra for premium channels, HBO and Cinemax.
AT&T also has plans to expand its entertainment library by acquiring New York-based media company Time Warner in a $108.7 billion merger. If the merger is approved, AT&T would own valued content and networks, including HBO, CNN and Warner Bros. Studios.
While DirecTV Now subscriber numbers beat expectations, they are dwarfed by those of internet TV companies. Netflix added 7 million subscribers in the fourth quarter of 2016 _ bringing its total to 93.8 million members. Amazon doesn't release subscriber numbers, but has said it counts Amazon Prime members in the tens of millions.
Shares of AT&T rose 1.56 percent to $41.65 at 12 p.m. in New York Friday. AT&T's fourth quarter earnings call is scheduled for Jan. 25.
