The company added 16,000 new business subscribers during the quarter.
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Charter also increased high-speed data customer additions, adding 131,000 in the period versus 94,000 additions in the same period past year. Although pay TV is “slowly drip, drip, drip declining”, Comcast, TWC and Charter “have blown away expectations for video subscriber losses, with Charter posting a subscriber gain”. The ratio is negative, as 101 funds sold all Time Warner Cable Inc shares owned while 267 reduced positions. Analysts had been expecting earnings of $1.55 per share and revenue of $5.96 billion. High-speed data subscribers rose by 232,000 to 12.394 million.
Evercore analyst Vijay Jayant said that “Video trends [are] improving with cable leading the way – with ~70% of the industry having reported 3Q15 results, video losses have so far shown great improvement”. The cost of the product relative to the incomes of people has created a big mismatch. Time Warner Cable was the topic in 5 analyst reports since July 31, 2015 according to StockzIntelligence Inc. The subscriber only needs to type in a username and password. TV networks are “devaluing the product by not managing” their apps to protect against password-sharing, he said. That has “reduced the demand for video” in the college market “because you don’t have to pay for it”, Mr. Rutledge said.
It’s a notable improvement for a company that most Wall Street analysts expected to lose at least 100,000 TV customers last quarter, and it’s the best performance since 2006, notes the company. This figure included 4,000 net commercial video customer additions.
That is “about the range most media investors *say* they’re comfortable with”, he said.
“I’m very excited about the operating momentum reflected in our third-quarter results. While this is a positive read-through to media companies, we still think skinny video offerings played a few part in the quarter’s success”.
The company is testing an Internet delivered version of the TV package that subscribers might be able to use with a smart TV device, such as a Roku box, or on mobile devices without a set top box.
Net income attributable to Time Warner Cable shareholders fell to $437 million, or $1.53 per share, from $499 million, or $1.76 per share, a year earlier.
Time Warner Cable Inc said it is working to close its merger with Charter Communications Inc by the end of this year, but that target seems “ambitious”.
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Shares in the company, up 21% this year, were inactive premarket.
