Rebecca Day

Warner Pictures will release its full 2021 film slate on its HBO Max service in a one-month streaming exclusive at the same time it releases the titles theatrically worldwide, said the studio Thursday. The hybrid model is a “strategic response” to the impact of the COVID-19 pandemic, particularly in the U.S. After the one-month HBO Max access period, each film will leave the platform and continue in theaters and international territories under customary distribution windows. All films will be available in 4K Ultra HD and HDR on HBO Max. “The “one-year plan” will allow the studio to support its theater partners with “a steady pipeline of world-class films, while also giving moviegoers who may not have access to theaters or aren’t quite ready to go back to the movies” the chance to see its 2021 films, a “win-win,” said Ann Sarnoff, CEO of WarnerMedia Studios and Networks.

Cyber Monday was on track to become the highest online spending day, said Adobe Analytics Monday, after Black Friday crushed records, soaring 22% to $9 billion. Black Friday was the No. 2 e-commerce day ever, lagging only Cyber Monday 2019. Consumers spent $3.6 billion via smartphones, a 25% increase and 40% of total online spending. Top-selling electronics were Apple's AirPods and Watch, Amazon Echo smart speakers and Samsung TVs. Best Buy advised customers of possible shipping delays, a situation stakeholders have been warning about.

Smartphone sales fell at Best Buy in the quarter ended Oct. 31, largely due to the late launch of the 12 series of iPhones, Chief Operating Officer Mike Mohan told investors Tuesday. Demand for higher-capacity 5G phones with larger screens is high, he noted. The replacement cycle for phones “has been forever changed,” he said. Best Buy Q3 comparable sales surged 23% year on year to $11.8 billion, said CEO Corie Barry. Online sales jumped 200% in October, said Barry, while ship-to-home speeds reached their highest level since the pandemic began. Domestic online revenue spiked 174% and to 35% of total domestic revenue, vs. 15.6% of the revenue mix last year, said the company. Barry highlighted strength in computers and home theater. Chief Financial Officer Matt Bilunas tempered expectations for the holiday quarter. He cited the surge in COVID-19 cases during a time of “significant holiday volume.” Shares closed 7% lower at $113.54.

Bally's and Sinclair’s partnership to integrate gaming content into Sinclair’s 190 TV stations and 21 regional sports networks will be a factor in pending negotiations about distribution with sports teams, said Sinclair CEO Chris Ripley on a Thursday call. “It’s a proven phenomenon” from research and oversees markets that “real-money” sports betting “creates a virtuous circle of viewership,” said Ripley. “More gaming creates more viewership, creates more gaming, which creates more viewership.” Gaming will be a “huge megatrend in sports watching" that will ultimately make sports and sports rights more valuable, Ripley said.

Target executives credited “flexibility” and “agility” for a 21% year-on-year hike in comparable sales. Stores had a 9.9% year-on-year comparable sales bump; digital comps spiked 155%, they said on a Wednesday Q3 call. Sales through same-day services soared 217%. Revenue grew 21% to $22.6 billion. CEO Brian Cornell cited “sharply higher” sales gains in hardlines, with comp growth in the mid-30% range, led by electronics, up 50%. He highlighted strength in computer software, videogames, portable electronics and office equipment. Inventory shortfalls persist amid “huge swings in pace of sales” in some categories, said Chief Operating Officer John Mulligan. Employees are playing “catch-up” in long-lead categories such as electronics that had “an unexpected sharp and sustained explosion in demand.” Target ended Q3 in a better inventory position and expects additional recovery in Q4. It didn't provide guidance due to “continued headwinds facing the consumer and the economy,” said Chief Financial Officer Michael Fiddelke. He referenced uncertainty about the path of the pandemic and continued levels of employment.

With COVID-19 accelerating a retail shift to online and digital, Walmart had a 79% spike in e-commerce net sales growth in Q3, said CEO Doug McMillon in a Q3 Tuesday call. “We’re convinced that most of the behavior change will persist beyond the pandemic.” McMillon cited the retailer’s omnichannel retail strategy allowing consumers to shop the way they’re most comfortable: in store, curbside pickup or online delivery. Walmart doubled employees working the in-store pickup business to 140,000 to accommodate customer preferences, said Chief Financial Officer Brett Biggs. Company revenue rose 5.2% vs. Q3 2019 to $134.7 billion. U.S. comparable sales advanced 6.4%. Coronavirus costs totaled $600 million. Q4 “will feel different from past years as customers shop differently and shopping events are spread out," said Biggs. McMillon believes customers want to find a sense of normalcy in this “unique” holiday season, even if they can’t be with relatives in the usual way. Following reports that the retailer ended a contract for shelf-scanning robots in some stores because humans could handle the job just as fast, McMillon said automation will be a “big part of what we do." The company continues to conduct pilots for automation to find ways to improve efficiency, he said. Automation will play a role “in helping the store experience get better as it reduces the amount of work associates have to do at the store level just moving freight around,” he said.

Roku is the only major video streaming service without HBO Max, after HBO's announcement Monday the service will be available on Amazon Fire TV devices starting Tuesday. Roku customers had access to HBO Go before the shutdown of that app in July but can’t get HBO through the Roku platform due to ongoing talks (see 2007010059). “We’re in discussions with Roku,” emailed a spokesperson at HBO parent AT&T Monday. Roku didn’t comment. The $14.99 monthly HBO Max service begins rolling out on Amazon Fire TV streaming players, Fire TV Edition smart TVs and Fire tablets Tuesday. Existing HBO subscribers through Amazon’s Prime Video channels will be able to log into the HBO Max app with their Amazon credentials “at no additional cost,” said HBO. The HBO app on Fire TV and Fire tablets will automatically update to become the HBO Max app, and customers will be able to log in using existing HBO credentials. HBO Max customers, regardless of how they subscribe to the platform, can access all of HBO Max via supported Fire TV and Fire tablet devices using existing provider credentials, it said. The agreement includes integration with Alexa for voice search. HBO Max content is also integrated into universal search on Fire TV: Its content will appear in searches such as “Alexa, find dramas” or “Alexa, find Game of Thrones,” for example. Since HBO Max launched in May, 8.6 million customers activated subscriptions.

Apple’s “embracing the ability” to capture, share and edit content in Dolby Vision on iPhone 12 models shows how “the Dolby experience can apply far beyond even those more traditional forms of content,” said Dolby CEO Kevin Yeaman on a Thursday investor call. Dolby Vision continues to be a growth area for the company, said the executive, estimating the HDR technology is in 15%-20% of 4K TVs. In the last fiscal year, 4K models were just over 50% of the TV market for Dolby, he said. The company is winding down and exiting conferencing hardware sales, said Yeaman. It's focusing now on Dolby Voice through software on the Dolby.io platform, which is designed to give developers the tools they need to enhance content with high-quality sound with a minimal amount of code. The company is seeing growing engagement with Dolby.io from developers in a range of uses, including podcasts, media production, online marketplace videos, online education, social media and livestreaming applications, he said. Dolby’s fiscal Q4 revenue fell 9% year on year to $271 million, and year-on-year revenue dropped 6% to $1.2 billion, mostly due to COVID-19, said Chief Financial Officer Lewis Chew. The company beat the high end of guidance for the quarter, $255 million. Quarterly revenue improved by $24 million vs. Q3 on higher unit volumes in TVs, set-top boxes, digital media adapters and PCs, he said. Overall licensing revenue growth slipped 3% for the quarter and year. Despite continued headwinds in its cinema-related business, Dolby “significantly exceeded Q4 expectations,” Colliers analyst Steven Frankel wrote investors Friday, saying “the best is yet to come” as the business benefits from 4K TVs and set-top boxes, new gaming platform launches and growth of the Dolby.io platform. Shares closed 7% higher Friday at $87.20.

Xperi raised revenue guidance after its settlement with Comcast of long-standing litigation over its TiVo patent portfolio. The companies signed a 15-year licensing program for pay TV, dating to the expiration of their prior agreement, that supports Xperi’s core pay-TV licensing program revenue through early 2031, said CEO Jon Kirchner on a Q3 call Monday. Comcast didn't comment Tuesday. Xperi raised second-half guidance to $625 million-$645 million from $390 million-$410 million. Xperi Q3 revenue was $202.8 million. Though end markets are beginning to show signs of recovery, Xperi remains “cautious” about the pace of recovery in 2021, Kirchner said. Shares surged 24% Tuesday to close at $17.32. Revenue in the connected car category declined 5.8% to $18.5 million due to lower production during the pandemic. Kirchner referenced signs the automotive market is starting to recover and said a recovery in HD radio shipments will track market trends. He cited car sales projections indicating a 9% recovery next year.

Roku revenue soared 73% in Q3 to $452 million on demand for TV streaming products, growth in advertising and expansion of content distribution partnerships, said the company in a Thursday shareholder letter. Advertisers “reassessed their TV upfront advertising commitments and moved significant portions of their investments to connected TV platforms like Roku,” said CEO Anthony Wood on a Thursday investor call. Advertising with Roku gave marketers additional reach over linear TV and capability to target advertising and measure effectiveness, said Wood. Some 97% of TV advertisers that spent $1 million or more with Roku in Q3 last year returned in the 2020 quarter; the company closed 2021 upfront deals with the six major agency holding companies at increased levels of commitment. Unit sales of Roku players jumped 57% year on year, the highest growth in seven years, while average selling price slipped 1%, said Chief Financial Officer Steve Louden on the call. Pivotal Research Group analyst Jeffrey Wlodarczak said in a Friday investor note that the “significant revenue beat” was due to a “favorable backdrop” of cord cutting, COVID-19 stay-at-home orders, “relatively few competitors in" direct-to-consumer aggregation and an election-driven advertising rebound. Q3's 2.9 million net new active subscriber accounts topped PRG’s forecast of 2.7 million. Wlodarczak maintained his view that Roku will be squeezed by Comcast, Cox and other traditional distributors “attacking the [over-the-top] aggregation opportunity.” Wedbush analyst Michael Pachter called Roku’s growth “sustainable” because most advertising remains on linear TV and “will continue to shift in Roku’s direction” as content moves to OTT platforms. Roku users streamed 14.8 billion hours in the quarter, up 54% year over year; streaming hours per active account grew 9%, after easing of pandemic-related restrictions in summer, said the company. The number of active accounts rose 43% to 46 million on strong player and Roku TV sales in U.S. and international markets. Average revenue per user rose 20% to $27. Roku again didn't provide quarterly guidance due to global COVID-19 resurgences and uncertainties about the holiday season and consumer spending levels. Louden said Q4 year-over-year revenue growth will be in line with the last few holiday seasons, in the mid-40% range. The company expects platform receipts to be about two-thirds of total Q4 revenue. Shares closed 12.6% higher Friday at $253.36.