Comcast Reports Strong Earnings as Cable TV Subscribers Hold Steady
Comcast, already the largest cable operator in the country, is trying to become even larger with a proposed takeover of Time Warner Cable. But even without that enormous planned acquisition, Comcast is growing.
For the second consecutive quarter, Comcast added paying television customers, gains that helped the company report strong earnings on Tuesday, including revenues that were up 13.7 percent from the same period a year ago. It also continued to add Internet and telephone subscribers.
Comcast added 24,000 paying television subscribers, a modest increase but notable because most other cable providers are losing thousands of subscribers each quarter. More Americans are becoming so-called cord cutters, abandoning their pricey cable subscriptions in favor of online offerings from services like Netflix, Hulu and Aereo.
By adding video subscribers for the second quarter in a row, Comcast bolstered its argument that it provides a high-quality product that consumers are willing to pay for.
That logic is the underpinning of Comcast's proposed $45 billion acquisition of Time Warner Cable, a deal that would unite the two largest cable operators in the country. Comcast argues that it will be able to provide superior service to Time Warner Cable's subscribers.
'Our focus on the customer experience continues to drive our success as we deliver the most innovative products in the industry and make measurable progress in customer service,' Brian L. Roberts, Comcast's chief executive, said in a statement.
But the proposed size of the combined company has raised concerns among regulators, competitors, consumer advocacy groups and some lawmakers in Washington. On Monday, Netflix came out against the merger, saying it would reduce competition and harm consumers.
Regardless of whether the deal is completed, Comcast is entering into months of regulatory review on sure footing. In addition to adding video subscribers in the first quarter of 2014, revenue from cable TV services was up slightly to $5.2 billion.
Comcast added 383,000 high-speed Internet customers, down markedly from its huge gains in the same quarter a year ago, but a big addition nonetheless. Revenue from Internet services was up 9 percent, to $2.8 billion.
Comcast's home telephone business grew by 142,000 customers, down from the sharp growth a year ago, but enough to increase revenues for the group slightly to $920 million.
The performance of the company's business services group also improved, with revenues up 24 percent to $917 million.
NBCUniversal, the television and movie division that Comcast acquired in 2011, also had a strong quarter. Overall revenues for NBC Universal were up 29 percent, to $6.9 billion.
Some of the strength was attributable to the Winter Olympics, which NBC broadcast in February, and to the strong debut of Jimmy Fallon as the host of 'The Tonight Show.' But even without the Olympics, revenues at NBCUniversal were up 8 percent.
'At NBCUniversal, we had another superb quarter with double-digit revenue and operating cash flow growth driven by the tremendously successful Sochi Olympics and the best season-to-date broadcast ratings in a decade,' Mr. Roberts said.
Results at the company's film division, up 11 percent to $1.4 billion, were helped by strong theatrical releases of 'Ride Along,' 'Lone Survivor' and the international release of 'The Wolf of Wall Street.'
'Overall, the company is performing well and the more planning we do for our proposed merger with Time Warner Cable, the more excited we are by the opportunities for the combined company,' Mr. Roberts said in the statement.
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