AT&T said it would lose a total of 390,000 traditional TV-video subscribers from its DirecTV and U-verse pay TV business in the third quarter of this year.
In a filing with the SEC, AT&T also said it would gain about 300,000 subscribers for its DirecTV Now-- the live, linear streaming package of networks.
But this is not good news.
“Either way, that’s a very weak number, and that is what really scared people,” says Craig Moffett, senior research analyst of MoffettNathanson Research, on CNBC on Thursday.
Moffett says AT&T was putting a lot of money in promotional and advertising against DirecTV Now. AT&T was getting an effective $60-a-month profit margin per subscriber from its traditional DirecTV business, but an effective $20 loss for its new DirecTV Now business.
“It tells you they are really struggling,” says Moffett.
Analysts say AT&T and other pay TV providers are now subject to increased “cord-cutting” -- traditional pay TV consumers leaving their long-time pay TV networks' packages.
This year, there will be 22.2 million cord-cutters 18 and older -- up 33.2% over 2016, according to eMarketer.
Previously, Comcast announced that it expected to lose around 150,000 video subs in third-quarter 2017.