Time Warner Cable’s 1Q profit driven by business services
An increase in Time Warner Cable’s business services revenue helped the cable operator’s bottom line in the first quarter, but the nation’s second-largest cable operator continued to bleed out basic video subscribers.
For the quarter, Time Warner Cable lost 119,000 basic video subscribers, which were more than the 91,000 that analysts had projected. By contrast, AT&T Inc. said earlier this month that it added 232,000 U-verse TV subscribers while Verizon added 169,000 FiOS video customers in the first quarter.
Time Warner Cable added 131,000 data customers, but lost 35,000 telephony subscribers. Overall, revenue from residential services increased 4 percent from the same quarter a year ago to $4.61 billion.
Business services revenue increase 25 percent to $537 million while ad revenue was up 8 percent to $228 million.
“Business services continues to perform very well, generating 25 percent year-over-year revenue growth, and is on track for another terrific year,” Time Warner Cable chairman and CEO Glenn Britt. “In residential services, we’re executing on our revitalization plans to build a fundamentally stronger and more agile operation. As a result, I remain very excited about the long-term prospects for this business.”
Time Warner Cable reported a profit of $401 million, or $1.34 a share, up from $382 million, or $1.20 a share, in the same quarter a year ago. Excluding items, adjusted earnings rose to $1.41 a share from $1.30. Time Warner Cable’s revenue increased 6.6 percent to $5.48 billion while free cash flow declined 8 percent to $661 million.