Comcast shifts focus to Internet to cut reliance on cable

US cable giant Comcast reported revenue, net income and Capex during the third quarter of 2018.
Comcast revenue Q3 2018Comcast said it posted revenue of $22.135 billion (+5 percent), net income of $2.642 billion (+9.3 percent) and EBITDA of $7.133 billion (+2.5 percent) in Q3 2018.

Comcast CEO Brian L Roberts said: “Comcast Cable’s EBITDA growth was the fastest in six years, and customer relationship growth accelerated, driven by broadband net additions for a third quarter in ten years.”

Comcast Capex fell 2 percent to $2.4 billion in Q3. Cable Capex dropped 5.7 percent to $1.9 billion, reflecting lower spending on customer premise equipment, offset by increased investments in line extensions.

Cable capital expenditures represented 14.1 percent of Cable revenue in the third quarter of 2018 compared to 15.4 percent in last year’s third quarter.
Comcast Cable revenue Q3 2018Comcast strategy

Comcast Corp’s strength in its high-speed internet business offset a less severe drop in cable TV subscribers.

The largest U.S. cable company’s third-quarter results demonstrated a resilience to industry forces that have buffeted its rivals, Reuters reported.

As U.S. subscribers have continued to dump pricier pay-TV services in favor of cheaper streaming services, Comcast has managed to slow down defections, at least for a quarter, while growing its broadband services, on which all other products, including Netflix and video, depend. High-speed internet is the centerpiece of a strategy to survive a rapidly changing media landscape.

Philadelphia-based Comcast has remained the standalone among the big league players to resist the temptation to restructure to court consumers directly with streaming video products, as AT&T and Walt Disney Co have done.

“We’re looking at different ways to accelerate our business in terms of streaming,” said Steve Burke, chief executive of NBCUniversal. Burke added that it would not be a substitute for its existing pay TV business.

NBCUniversal revenue rose 8.1 percent to $8.63 billion.

Comcast beat Rupert Murdoch’s Twenty-First Century Fox in an auction to buy European satellite TV broadcaster Sky for $40 billion in September.

Sky CEO Jeremy Darroch said Sky could easily capture 10 percent more of the remaining 78 million households that do not yet subscribe to a Sky product across its European territories, which would add 8 million customers.

Comcast revenue from high-speed internet rose 9.6 percent to $4.32 billion in the quarter as the company added 363,000 internet subscribers. Comcast said it was the best performance for the division in ten years.

Comcast’s Xfinity Mobile, which operates off of Verizon Communications network, added 228,000 net phone lines during the quarter, hitting 1 million total lines. Comcast said that offering mobile with broadband has improved retention of broadband customers who buy both.