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Cable Technology Feature Article

January 29, 2014

Comcast Adds Video Subscribers for the First Time in Six Years

By Tara Seals, TMCnet Contributor

No. 1 U.S. cable MSO Comcast (News - Alert) has added video subscribers for the first time in more than six years, inking 43,000 of them into the roll books for the fourth quarter of 2013. The additions broke a 26-quarter losing streak (it lost 7,000 video customers in the prior-year quarter) and spurred Comcast to a 26 percent jump in profit.

As of the end of the year, Comcast had 21.690 million video customers (still down 1.4 percent year over year).

It also had 20.662 million broadband customers (up 6.3 percent year over year) and 10.723 million voice subs (up 7.2 percent year over year).

The stemming of the subscriber drain—an ongoing story in the cable TV segment even as satellite and IPTV (News - Alert) continue to grow—can be attributed to new approaches to the market like the X1 cloud-enabled DVR system and next-gen user interfaces, analysts said.

“Comcast completed its major technical innovations, such as DOCSIS 3.0, all digital networks and a multi-platform content delivery network,” said Zacks Equity, in an investor note. “Moreover, launch of innovative services such as Xfinity Home, Wi-Fi, Streampix, X1, upcoming X2 and the high-speed Metro Ethernet will not only drive subscriber growth for the company but will also safeguard its position against major carriers like Verizon (News - Alert) Communications Inc. and AT&T Inc., and online video streaming service providers like Netflix.”

Comcast’s net income for the quarter was $1.913 billion, or 72 cents per share, compared with $1.518 billion or 56 cents per share in the prior-year quarter. Total revenue came in at $16.926 billion, up 6.2 percent year-over-year.

Cable video revenue was $5.120 billion, up 2.9 percent from the prior-year quarter. High-speed Internet revenue was $2.650 billion, up 8.7 percent year over year, and voice revenues were $928 million, up 3.7 percent year over year. Advertising revenues were $602 million, down 7.5 percent from the year-ago quarter, and business services revenue was $876 million, up 25.3 percent year over year. Other revenues were $485 million, up 8.5 percent year over year.

Quarterly operating costs and expenses were $11,281 million, up 5.5 percent year over year. However, quarterly operating income was $3,647 million, representing annualized growth of 9.7 percent. Operating margin was 21.5 percent compared with 20.7 percent in the prior-year quarter.

During the fourth quarter, Comcast repurchased 10.8 million worth of its common shares for $500 million and paid dividends totaling $510 million. Following the results, the company raised its share buyback plan to $7.5 billion. Consequently, Comcast hiked its yearly dividend payments by 15.4 percent to 90 cents per share.

At NBCUniversal, quarterly total revenue was $6.464 billion, up 7.5 percent year over year. Out of that, cable networks revenues were $2.324 billion, up 5.3 percent year over year. Broadcast TV revenues were $2.227 billion, up 11.5 percent year over year. And filmed entertainment revenues were $1.448 billion, up 4.9 percent from the year-ago quarter. Theme parks revenues were $566 million, up 8.8 percent year over year.

Edited by Ryan Sartor

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