Comcast told investors to expect programming costs at the cable systems to increase at a “similar rate” to the 6.4% they saw in Q3. In addition, the firm continues to press its Internet-speed advantage, with almost three fourths of its customers receiving 50 megabit service or better. And as people increasingly watch TV online instead of through cable TV, the company has tried to adjust by developing a subscription Web-streaming service called Stream, and introducing a free online video service, Watchable, featuring videos from youth-oriented networks such as Vice Media and AwesomenessTV.
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Zacks Research has compiled a average broker rating of 1.36 on shares of Comcast Corporation (NASDAQ:CMCSA).
Shammo’s comments generated plenty of industry interest last week, but a few Wall Street analysts urged restraint: “In our view, this was a formality, not an indication that the fifth wheel is being aligned”, Jefferies analyst Mike McCormack said in a note to investors shortly after Shammo’s comments. The company has been losing TV subscribers for years, partly because of competition from DirecTV and Verizon FiOS, but also because of dissatisfaction with the ballooning cost of the monthly bundle.
Comcast’s broadband and business services divisions posted strong revenue growth in the third quarter, offsetting video customer losses and softness in the voice business.
Broadcast Television segment revenue increased 11.3% to $2.0 billion, compared to $1.8 billion in the third quarter of 2014, reflecting a 33.5% increase in content licensing revenue. Box-office hits “Minions” and “Jurassic World” helped drive up sales in the film division by 64 percent. Comcast operating cash flow increased 7% to $4.7 billion.
The MVNO agreement stems from the 2011 sale of wireless licenses owned by SpectrumCo, a consortium that included Comcast, Time Warner Cable and Bright House Networks, to Verizon for $3.6 billion.
Newer options have been added to the company’s lineup in an attempt to reel in customers and keep current subscribers. Comcast will report third-quarter financial results on Tuesday before the opening bell.
Net income attributable to Comcast fell 23 percent to $2 billion, or 80 cents per share, from a year earlier.
So far, the pay-TV sector stands at 24,000 customers lost, with Comcast set to report its numbers Tuesday morning. Operating cash flow at the theme parks segment increased 14.1% to $458 million. Universal’s fantastic performance at the box office fueled 20%-plus revenue growth at NBCU for the second consecutive quarter.
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When asked about the plans, CEO Brian Roberts said his company believes wireless is important to consumers and touted the success of his company’s Wi-Fi network. Broadcast TV revenues came in at $1,971 million, up 11.3% year over year.
