Comcast Allays Cord-Cutting Fears With Surge in New Subscribersby
Cable giant signed up 80,000 video customers in the quarter
Company announces increased dividend, two-for-one stock split
Comcast Corp. is living in a golden age of TV -- cable TV.
The largest U.S. cable operator gained TV customers in four of the past five quarters and added to its subscriber rolls for the first time in almost a decade, countering a trend of precipitous decline in traditional pay-TV and reclaiming market share from some telecom carriers and satellite-TV providers.
The turnaround in the cable business helped Comcast beat profit estimates for the fourth quarter. Executives attribute the momentum in their cable-TV business largely to their new video platform, called X1, which makes it easier to search for shows and movies on TV and on Netflix from their cable set-top box.
The shares rose as much as 4.1 percent in early trading in New York Thursday. The stock has surged 35 percent in the past year.
Meanwhile, Comcast is still growing by selling high-speed Internet. The company signed up 385,000 new broadband customers in the quarter, topping the average prediction of about 380,000 from three analysts. It signed up 460,000 broadband subscribers in the same quarter a year ago.
Comcast is also pushing into the wireless business. By the middle of this year, the cable provider plans to offer a mobile phone service that lets subscribers makes calls and surf the web using Verizon’s wireless network and Comcast’s millions of Wi-Fi hotspots.
The company also announced that in 2017 it will increase its quarterly dividend by 15 percent, split its shares two-for-one and buy back $5 billion in stock.
- Total revenue rose 9.2 percent to $21 billion in the quarter, topping analysts’ estimates of $20.7 billion.
- Comcast signed up 80,000 new cable-TV customers in the period, topping the 77,929 average of analysts’ estimates.
- The company posted earnings of 89 cents a share, exceeding the 87-cent average of analysts’ estimates.
- Net income for the quarter was $2.3 billion, up 17 percent from a year earlier. The average monthly customer bill climbed 3.8 percent to $150.58.
- Comcast’s Universal film unit, which acquired DreamWorks Animation last year, generated $1.83 billion in sales during the period, up 13 percent from a year earlier, driven by the box-office success of the animated feature “Sing.”
- Sales in the business services division, which sells phone, web and video services to companies, rose 15 percent to $1.44 billion.
- Revenue at the NBCUniversal group, which includes the NBC broadcast network, cable channels such as USA and MSNBC, the Universal film studio and theme parks, grew 13 percent to $8.45 billion. The results were helped partly by the NFL expanding some of its Thursday Night Football broadcasts to include NBC.
- Cable network sales gained 4 percent to $2.5 billion.
- The cable operator paid $658 million in dividends in the quarter, a 7.2 percent increase from a year earlier, and bought back $1.24 billion in stock.