Customer growth boosts Comcast sales, earnings
An increase in Internet and voice customers and a rebound in advertising lead to a rise in earnings and sales for Comcast in the first quarter.
Comcast can thank a rise in Internet and voice customers and a rebound in ad spending for helping sales and earnings grow higher than expected in the first quarter of 2010.
On Wednesday, the cable company reported a net profit of $866 million, or 31 cents a share, for the quarter ended March, a 12 percent rise from the $772 million earned in the year-ago quarter. Sales climbed 3.8 percent to reach $9.2 billion.
Results inched past the expectations of analysts surveyed by Thomson Reuters, who were eyeing earnings per share of 30 cents on revenue of $9.15 billion.
Comcast was hit in the first quarter by operating expenses of $29 million, or $17 million after taxes, related to its planned takeover of NBC Universal. But the company's overall growth in subscribers more than compensated.
For the quarter, Comcast saw the number of broadband Internet customers rise 7 percent to 16.3 million and phone subscribers increase 16 percent to 7.8 million compared with the same period a year ago. The number of people opting to upgrade to digital TV rose 9 percent to 18.8 million.
Comcast also enjoyed a 3.4 percent gain in subscribers hopping onto its Triple Play service, which combines TV, Internet, and phone services in one package. The only downside was a drop in the number of overall cable TV customers, 2.6 percent, about the same decline as last year.
The company's first quarter was also buoyed by a recovery in spending from advertisers, driving ad sales up 24 percent for the period.
"Our healthy operating and financial results for the first quarter mark a solid start to 2010," Comcast Chief Executive Brian Roberts said in a statement. "First quarter results were driven by robust customer growth, a rebound in advertising, momentum in Business Services, and our continued focus on expense and capital management."
Comcast is awaiting regulatory approval for its proposed buyout of NBC Universal, currently being.