Warner Bros. Discovery reported its second-quarter earnings results Thursday, revealing that it dropped 1.8 million streaming subscribers across HBO, Discovery+ and its new combined streaming service Max. The company now has a total of 95.8 million users, compared to 97.6 million in the first quarter.
The loss in subscribers is likely due to customers with overlapping accounts (Max and Discovery+) getting rid of extra subscriptions. WBD, as well as analysts, anticipated streaming churn. For instance, Goldman Sachs analyst Brett Feldman expected the overlap of about 4 million subs of HBO Max and Discovery+, per The Hollywood Reporter.
“The migration to Max has gone exceedingly well with the overwhelming majority of subscribers in the U.S. successfully transferred,” WBD CEO David Zaslav said during the earnings call as an attempt to reassure investors. “While we have seen some expected subscriber disruption, we have experienced lower-than-expected churn throughout this process.”
Max rolled out to subscribers on May 23. In the first week of the launch, 70% of existing HBO Max subscribers transitioned to the streamer, J.B. Perrette, WBD’s global streaming president, recently told the Wall Street Journal. However, Perrette also noted during the interview that Discovery+ lost subscribers.
The second quarter covers from April 1 to June 30, so although Q2 marks the first time the company has included Max subscriber totals, the third quarter will be when Max results are fully a factor.
Total revenues for the second quarter were $10.36 billion, compared to $10.7 billion in Q1. Wall Street analysts forecasted a revenue of $10.46 billion. The company also reported a net loss of $1.24 billion, up from $1.07 billion in the previous quarter. WBD added that, since the merger, it has paid down $9 billion in debt, including $1.6 billion this quarter.
Last quarter, before the Max launch, the company predicted its U.S. direct-to-consumer business would be profitable by this year.
Originally published at techcrunch.com