AT&T, Discovery Fall on Dividend Reduction in Warner Spinoff (1)

AT&T Inc. shares declined after the telecommunications giant said it will pay a dividend at the lower end of its previously announced range following the spinoff of its WarnerMedia business to Discovery Inc.

AT&T will lower its dividend payout ratio to about 40% of cash flow, the company said in a filing. That translates to about $1.11 a share, or $8 billion annually. AT&T had originally planned to pay a ratio of 40% to 43%, or as much as $9 billion. Prior to the deal AT&T’s dividend was $2.08 a share, or about $15 billion.

The company’s shares fell ...