Comcast's earnings surge as revenue rises
NEW YORK — Comcast, the nation’s largest cabler, saw quarterly earnings surge 64% to $430 million as total revenue for the second quarter ended in June rose 10.5% to $5.6 billion.Comcast saw revenue at its high-speed Internet biz jump 28% to $982 million. But the Philadelphia-based company said fewer customers signed up as it added 297,000 high-speed subs vs. 327,000 in the year-earlier quarter. Video revenue rose 5.9% to $3.4 billion, partly on higher monthly rates. Comcast added 284,000 digital cable subscribers in the period for a total of 9.1 million. Earnings beat Wall Street’s expectations, driving the shares up 1.27% to close at $31. Company expects to add 1 million digital phone subscribers next year as cablers ramp up telephony service. Analysts responded enthusiastically to management’s hint during a conference call at a more aggressive share repurchase or the declaration of a dividend. Execs were bullish on a deal recently inked with Starz Encore that will let Comcast offer digital subs 250 on-demand movies each month for free starting in October. Chief operating officer Steve Burke said “Lord of the Rings” will be among the first batch. Chairman-CEO Brian Roberts said that Comcast subs viewed more than 112 million on-demand programs in June — a 10 million increase in three months. Burke said it would be “impossible” for the world’s largest cable-television company to create a sports channel to rival ESPN. The Wall Street Journal said last week that Comcast’s Outdoor Life Network, best known for showing seven-time champion Lance Armstrong in cycling’s Tour de France, is negotiating to add professional hockey and football games to try to compete with the Walt Disney Co.’s all-sports network. “ESPN is in such a league of its own, and has established such a strong brand, it would be impossible for us to compete with ESPN even if we wanted to,” Burke said. “What we’re trying to do with Outdoor Life is add to it and make it a better channel.” Charter lowers loss Meanwhile, Charter Communications, the St. Louis-based cabler owned by billionaire Paul Allen, narrowed its net loss by $60 million to $356 million last quarter. Revenue rose 7% to $1.3 billion, driven by high-speed Internet revenue and average revenue per customer. Charter added 43,800 high-speed Internet customers and 12,500 telephone customers but lost 9,000 digital video customers and 41,700 analog video customers. Net gain was 5,600 customers. “Our focus on disciplined operational improvement is gaining traction and beginning to show positive results,” said interim CEO Robert May. “While customer additions were impacted by competition in certain markets and seasonality characteristic of the second quarter, we are gaining ground in terms of customer retention and additions, a result of our targeted approach to customer growth. “We are encouraged by these midyear results, but realize there is more to be done,” May said. Wall Street agreed, knocking the troubled stock down 3% to $1.29.
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