Comcast Shakes Off Storms, Subscriber Losses to Beat Estimates
(Bloomberg) -- Comcast Corp. showed resilience against the twin threats of hurricanes and TV competition.
The biggest U.S. cable provider beat analysts’ estimates for third-quarter profit, and matched projections for revenue, even after the storms Harvey and Irma took a toll on subscriber gains. Comcast held steady in part by getting customers to pay more -- the average monthly bill climbed 2.1 percent from a year earlier to $151.51.
The results offer investors some comfort in what has been a tumultuous year in the media industry, with pay-TV companies and cable networks struggling to contend with the onslaught of new entertainment options, from Netflix to Snapchat. The hurricanes in Texas and Florida made things worse, forcing Comcast and other providers to keep technicians off the roads for safety.
Comcast lost 125,000 cable-TV customers, the biggest decline in three years. The company estimates about 20,000 of the customer losses were due to storms, suggesting the rest were from heavy competition. The advent of online streaming cable packages, like AT&T Inc.’s DirecTV Now, have made the field of rivals even more crowded.
Third-quarter profit increased to 52 cents a share, excluding some items, Comcast said Thursday in a statement. Analysts predicted 50 cents. Sales slumped 1.6 percent to $21 billion from a year earlier, when the 2016 Olympics inflated revenue.
Comcast is competing for video customers with new online services like Dish Network Corp.’s Sling TV, as well as streaming services like Netflix and Hulu. While the industry has struggled with the rise of cord-cutters who drop pay-TV service, Comcast has generally held up better than its competitors.
AT&T, the company’s biggest rival, lost 390,000 satellite and u-Verse TV customers, defections that were mostly offset by DirecTV Now subscriber gains and resulted in a net loss of 90,000 video subscribers in the quarter.
Selling broadband internet service has become a key part of Comcast’s future, since it’s more profitable than selling TV service and even cord-cutters require Internet connections. But the storms took their toll there too. The company signed up 214,000 high-speed internet customers in the quarter, compared with analysts’ estimates of 267,000.
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