Comcast Broadband Subscriber Growth Slows to 300,000 in Q3, Wireless Adds Best Ever
With slowdown expected, broadband growth slightly better than analyst predictions
Comcast added about 300,000 total broadband customers in the third quarter, less than half the 633,000 additions it had in the same period last year, but slightly ahead of the slowdown that some analysts predicted for the company.
That should be a relief for some investors, who back in September feared the worst after Comcast chief financial officer Mike Cavanagh warned at an industry conference that subscriber growth for high-speed internet service was slowing down a little more than expected in August.
Analysts scrambled to revise their growth models for the sector, with most coming close to what Comcast actually reported on Thursday morning. Wells Fargo analyst Steven Cahall estimated that Comcast would add about 295,000 broadband customers (down from his previous estimate of 395,000 additions), Evercore ISI Group media analyst Vijay Jayant predicted 280,000 residential additions (Comcast added 281,000 residential and 19,000 business customer additions) and MoffettNathanson principal and senior analyst Craig Moffett predicted 302,000 total additions. Overall analysts' consensus estimates were for 296,000 broadband additions.
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Broadband helped drive strong revenue and cash-flow gains in the cable side of the business for the quarter. Comcast said cable communications revenue was up 7.4% to $16.1 billion and adjusted EBITDA rose 10.3% to $7.1 billion.
Wireless subscribers rose by 285,000 in the period, the best quarterly gain since its launch in 2017. Comcast ended the quarter with 3.7 million wireless lines.
Overall revenue was up 18.7% to $30.3 billion, and adjusted EBITDA rose 18.1% to $9 billion. Net income rose 34.6% to $4 billion. On the programming side, NBCUniversal revenue was up 57.9%, driven by a 47.5% increase at its Media unit, which benefited from the Summer Olympic Games. Minus the Olympics, Media revenue would have risen about 9.2% in the period.
In a press release, Comcast chairman and CEO Brian Roberts said he was pleased with the company’s Q3 performance, especially at its cable unit.
“At Cable, our customer and financial metrics remained strong, highlighted by 10% growth in adjusted EBITDA, the highest level of customer retention on record for a third quarter, and the most wireless net additions since the launch of Xfinity Mobile in 2017,” Roberts said. “Going forward, I am excited about the opportunity to continue to invest in our global technology platform and other businesses while returning more capital to shareholders.”
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Mike Farrell is senior content producer, finance for Multichannel News/B+C, covering finance, operations and M&A at cable operators and networks across the industry. He joined Multichannel News in September 1998 and has written about major deals and top players in the business ever since. He also writes the On The Money blog, offering deeper dives into a wide variety of topics including, retransmission consent, regional sports networks,and streaming video. In 2015 he won the Jesse H. Neal Award for Best Profile, an in-depth look at the Syfy Network’s Sharknado franchise and its impact on the industry.