Broadband booms as residential video tumbles for Comcast

Broadband booms as residential video tumbles for Comcast
Editor
| 27 July 2018

Maybe explaining why it would want to spend so much on Sky and proving that you can be too skinny as the arrival of virtual bundles cut into business, Comcast has reported a poor second quarter for video if not its broadband offer.
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Overall the cable giant reported that for the three-month period ending 30 June 2018 consolidated revenue increased 2.1% on an annual basis to $21.7 billion with consolidated net income increasing 27.6% compared with the end of the second quarter of 2017 to $3.2 billion . Consolidated Adjusted EBITDA increased 4.8% to $7.4 billion.

Looking at the company’s business lines in Q2 2018, Comcast Cable Communications increased revenue 3.4% and EDITDA by 6.5%. Total customer relationships increased 2.8% year-over-year to 29.8 million, including net additions of 182,000 in the quarter. Pointedly, high-speed internet residential revenue increased 9.3% while business services revenue increased 11.1%.

As a clear indication of where business activity was growing sharply, total high-speed internet customers increased by 260,000. As a clear indication of where business activity wasn’t growing sharply, the video segment showed a total of 140,000 net video customer losses at the end of the quarter to 22.121 million. In the residential sector, the quarter saw net losses amount to 136,000 leading to a total of 21.074 million, slipping 1.9% compared with the total at the end of the second quarter of 2018.

The marked fall in customers dragged down video revenue by 1.9%, to $5.628 billion. For the half year ended 30 June 2018, video revenues amounted to $11.287 billion, down 1.4% on an annual basis. Higher overall revenues were also partially offset by a 1.4% increase in operating expenses. The higher expenses were due to a 3.3% increase in video programming costs, primarily reflecting higher retransmission consent fees and sports programming costs.

Undeterred by the mixed performance, Comcast chairman and chief executive officer Brian Roberts asserted that the company had delivered “fantastic” results in the second quarter.

He said: “[Comcast had] robust free cash flow of $4.3 billion [and at] Cable Communications , we added 182,000 customer relationships, largely driven by our addition of 260,000 broadband customers, which was the highest second quarter result in ten years. These strong customer metrics were balanced with robust EBITDA growth, fuelled by high-speed Internet and business services. NBCUniversal’s performance was highlighted by continued momentum in affiliate revenue at our cable networks business, and Telemundo presented its first ever FIFA World Cup which set multiple records for the network...Overall, our successful results in the first half of 2018 underscore the strength we see across Comcast NBCUniversal.