Broadband growth highlighted Comcast’s Q3 earnings, as the operator added 320,000 new Internet subscribers and saw revenues from its Internet business climb more than 10%.
The cable operator lost 48,000 video subscribers, better than last year’s 81,000 dip, and saw its broadband business continue to increase its subscriber lead over pay TV. Comcast now has 22.87 million broadband subscribers compared to 22.26 million pay-TV subscribers.
Broadband also was hailed for leading the company’s cable business growth. Although pay-TV provided the most revenue, at $5.35 billion compared to broadband’s $3.13 billion, broadband revenue growth was 3X that of pay-TV, 10.2% to 3.3%.
During a conference call, Chairman and CEO Brian Roberts said broadband was a key to the segment’s “best third quarter in nine years,” and said new products, like Internet Plus and other broadband offerings were doing well with Millennials and other audience groups that Comcast has had a difficult time attracting and hanging on to.
The company also said it has aggressively been rolling out its new X1 platform, saying about 60% of connects in the quarter – about 40,000 per day -- were through the new box. About 20% of its video subscribers have the new box. Roberts told analysts the company was fully invested in the platform and expects it to continue to build momentum.
Roberts provided few details about its Cloud TV platform that it’s currently trialing in one market, but said its newly launched Watchables OTT product has been well-received.
The product mix, he said, is helping Comcast by delivering “a better quality customer and holding on to them longer.”
Currently, only 70% of Comcast customers have a high-speed Internet connection, something the company sees as an opportunity for the future.
Roberts said it would roll out DOCSIS 3.1 in 2016, allowing Comcast to “increase the speed and smartness “ of the Internet for Comcast’s customers.
By the numbers:
- Comcast reported earnings per share of 80 cents, in-line with analyst estimates; profits were dow 19.2% Y/Y, again, in line with estimates.
- It reported revenue of $18.67 billion, an 11.2% increase over 3Q2014 that was $650 million more than Wall Street expected.
- Cable Communications revenue was $11.74 billion, with video, $5.35 billion (up 3.3%); Broadband was $3.13 billion (up 10.2%); voice was $900 million (down 1.4%) and business services was $1.2B (up 19.5%). Advertising was $593M (down 0.2%) and other revenues totalled $562M (up 11.8%).
- At NBCUniversal, revenues of $7.15 billion (up 20.8%). By segment: Cable networks, $2.4 billion (up 7%); broadcast television, $1.97 billion (up 11.3%); filmed entertainment, $1.95 billion (up 64%); theme parks, $896 million (up 14.1%).
- Operating cash flow was up 8% from a year ago.
- Comcast said only 8.4 million customers subscriber to a single product, with 9.1 million double –play subs and nearly 10 million triple-play customers.
- Comcast said it now has 11.7 million WiFi hotspots across its footprint, more than double what it was a year ago.
- Programing costs were up 8%.
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