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Here’s Why AT&T Shares Are Soaring Today

January 20, 2017, 4:36 PM UTC
AT&T Celebrates the Launch of DIRECTV NOW
NEW YORK, NY - NOVEMBER 28: CEO of AT&T Entertainment Group John Stankey speaks onstage during AT&T's celebration of the Launch of DIRECTV NOW at Venue 57 on November 28, 2016 in New York City. (Photo by Dave Kotinsky/Getty Images for DirecTV)
Dave Kotinsky, Getty Images for DirecTV

AT&T shares rose on Friday after the wireless carrier said it added more than 200,000 paying subscribers to its DirecTV Now streaming television service, launched in November.

AT&T also said that for the quarter ended Dec. 31, the company added 900,000 U.S. wireless subscribers.

Jennifer Fritzsche, an analyst at Wells Fargo (WFC), said in a note the numbers were a “net positive,” and the DirecTV Now additions appeared to be ahead of expectations.

Shares climbed 1.6% to $41.69 in morning trading.

AT&T (T) acquired DirecTV for $48.5 billion in 2015, making it the largest U.S. pay-TV operator, in an effort to diversify into the media and entertainment business.

The company is counting on the mobile video market for new revenue as wireless companies struggle to drive sales in an oversaturated cellular phone market. DirecTV Now, AT&T’s new Internet-based television service, debuted late last year at prices ranging from $35 a month for over 60 channels to $70 for over 120 channels.

The subscriber number disclosures came as the company released its annual reevaluation of pension liability. AT&T said it would record a pretax loss of about $1 billion in the fourth quarter after lowering the assumed discount rates used to measure pension and post-retirement plan obligations.

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It wasn’t the only company to record pension-related charges. Ford Motor (F) said on Friday it would record a pretax loss of about $3 billion related to its pensions in 2016.

AT&T said the $1 billion loss would not affect operating results in its various divisions and would be included as an adjustment in its fourth-quarter report.

The company will report fourth-quarter results on Jan. 25.

A year ago, AT&T said it expected to record a pretax gain of about $2.2 billion related to pensions and postemployment benefit plans after raising its discount rates.