Comcast’s earnings report this morning is sure to raise a few eyebrows on Wall Street as second-quarter profit rose 28 percent.
"We are again reporting double-digit growth in cable revenue, our 28th consecutive quarter of double-digit OCF growth and our fourth consecutive quarter of record-breaking RGU additions,” said Brian Roberts, chairman and CEO of Comcast Corp., in a prepared statement.
Philadelphia-based Comcast added 823,000 new digital-video customers – the highest level of quarterly digital additions in company history – with 59 percent of its video subscribers signed on for digital services by the end of the quarter. The company’s digital penetration rate was 48 percent over the same time frame last year. On the other end, Comcast did lose 95,000 basic cable customers in the quarter for a total of 24.1 million customers.
Pushed along by the FCC’s July 1 deadline for separable security, Comcast also installed a record 2.1 million digital set-top boxes in the second quarter of 2007, which was roughly equal to what it deployed in the previous six months combined.
Video revenue increased 7 percent to $4.5 billion in the second quarter, reflecting growth in digital cable customers and increased demand for digital features including on- demand, digital video recorders (DVR) and high-definition television (HDTV), as well as higher basic cable pricing.
The nation’s largest cable company added 671,000 digital phone customers to surpass the 3 million mark of subscribers for its Comcast Digital Voice service. The telephony service is now marketed to 38 million homes representing 79 percent of Comcast’s footprint.
Comcast’s phone revenue increased 98 percent to $420 million in the second quarter, which is a $264 million increase in CDV revenues from the prior year as a result of the significant growth in subscribers. The increase in phone revenue was somewhat offset by a $56 million, or 46 percent, decline in circuit-switched phone revenues as the number of circuit-switched phone customers continued to decline as Comcast focuses on marketing CDV service in most markets.
Over on the broadband side of the ledger, Comcast added 330,000 high-speed Internet subscribers during the second quarter and its penetration now exceeds 26 percent.
High-speed Internet revenues increased 20 percent to $1.6 billion, reflecting a 1.9 million, or 18 percent, increase in subscribers from the prior year.
Comcast’s triple play bundle also helped its net income increase from $460 million to $588 million. The company’s average monthly revenue per customer went up 11 percent to $101.02 compared to $90.76 in the same quarter a year ago.