Comcast posts 22% spike in Q3 earnings, launches 4G in Philly
Comcast posted a 22 percent increase in its third-quarter earnings, thanks in part to aggressive pricing on its bundled packages for voice and data.
Comcast earned $944 million in the third quarter, or 33 cents per share, compared with $771 million, or 26 cents per share, in the third quarter a year ago. Analysts were expecting earnings of 25 cents per share.
During a second-quarter earnings call in August, Comcast Chairman and CEO Brian Roberts said there would be a renewed focus on promotional efforts , particularly for high-speed data. Those efforts appeared to pay off as Comcast added 361,000 data subscribers and 375,000 new digital phone customers in the third quarter.
With the new data additions, Comcast now has a total of 15.7 million broadband subscribers to take over the top spot in the nation from AT&T, which has 15.6 million subscribers.
While the news was good for data and phone services, Comcast did lose 132,000 basic video subscribers in the third quarter.
With its aggressive bundle promotions, Comcast added 1.1 million lines of service in the third quarter, which was just below the total from the same time frame a year ago.
“The strength and resilience of our businesses combined with our continued emphasis on expenses and prudent capital management helped us achieve healthy operating and financial results in the third quarter,” Roberts said. “We continued to execute well, maintaining our focus on balancing revenue, cash flow and customer growth, while at the same time investing in attractive businesses like Comcast Business Services. We also made real progress on initiatives like wideband and all-digital that strengthen our competitive position now and in the future.”
Comcast’s revenue was up 3 percent to $8.8 billion, which was slightly off some analysts’ projections of $8.85 billion. Excluding special items, such as financing expenses and income tax benefits, Comcast’s profit was 28 cents per share.
Comcast’s free cash flow increased almost 20 percent to $1.11 billion.
Comcast is reportedly still pursuing a 51 percent stake in NBC Universal. According to Reuters, Comcast is looking at pouring $4 billion to $6 billion in cash and its cable networks into a joint venture with NBC Universal parent company General Electric.
According to published reports, Comcast could be close to announcing a deal with NBC Universal.
Comcast also announced today that its 4G wireless service was now available in Philadelphia.
"As Comcast's hometown, Philadelphia is one of the most technologically progressive cities on the East Coast. Having the first and only 4G service bundled with some of the nation's fastest Internet speeds is evidence to that fact," said Eric Schaefer, senior vice president of marketing for Comcast's Freedom region.
Comcast offers the service, which it calls High-Speed 2go, via its investment in Clearwire. The service is available to customers through wireless data cards.
Comcast is selling two different data cards and service plans:
- Comcast High-Speed 2go Metro service uses a 4G-only data card, giving customers wireless service within the 4G metro coverage area, according to Comcast. The Metro device operates only in a 4G service footprint.
- Comcast High-Speed 2go Nationwide service delivers the metro 4G service plus coast-to-coast access on Sprint's national 3G network. The Nationwide device switches between available 4G and 3G networks.
- Comcast said its subscribers will have bundled access to both the fastest wired and wireless Internet in the nation, which will be sold together at launch as a "Fast Pack" for as low as $49.99 per month for one year. Both new and existing Comcast customers will be eligible for special bundled pricing, with triple-play customers receiving 4G wireless as an add-on for as low as $30 per month.
- The $49.99 Fast Pack Metro service includes Comcast's 12 Mbps home Internet service, a free Wi-Fi router for mobility and extended coverage in the home, and 4G service that will provide 3 to 6 Mbps average download speeds when customers are on the go. For another $20 per month, customers can upgrade to the Fast Pack Nationwide service that includes the same services, plus nationwide 3G mobile network access.
Comcast’s 4G service is also available in Atlanta  and Portland, Ore., and the nation’s largest cable operator said Chicago and other markets will launch the service before the end of the year.