Comcast Subscribers Almost Stop Cancelling Cable

Published February 15, 2012 11:18PM (EST)

NEW YORK (AP) — It's become the routine in the cable industry that subscribers stream out the door every quarter, hanging up on cable in favor of service from satellite or phone companies. But in the October to December quarter, Comcast Corp. nearly managed to stop that flow.

The country's largest cable company on Wednesday said it lost 17,000 TV customers in the fourth quarter, the smallest number of defections in five years. It compares with a loss of 135,000 subscribers in the same quarter a year earlier.

Comcast credits more video programming available on more screens, like tablets and phones, and better customer service for the improved retention. Its stock jumped nearly 5 percent Wednesday.

CEO Brian Roberts said the company will start growing its video subscriber base once the economy improves and new households start forming.

"We may not get back to full growth on video for a while, because we don't see housing growth at the moment, but some day, that's going to happen," he told analysts on a conference call.

The Philadelphia-based company added a net 336,000 broadband customers in the same period. That was the best fourth-quarter result in years. Both cable and phone companies have been reporting declining numbers, since more than two-thirds of U.S. households already have broadband Internet.

The result indicates that Comcast keeps stealing broadband customers from phone companies. Together, AT&T Inc. and Verizon Communications Inc. added a net 49,000 broadband customers in the period.

The strong Internet subscriber figures helped boost Comcast's profit for the quarter. The TV business also helped, thanks to higher prices and upselling to bigger programming packages.

Comcast on Wednesday reported net income of $1.29 billion, or 47 cents per share, for the quarter. That's up 26 percent from $1.02 billion, or 36 cents per share, in the last three months of 2010.

Analysts polled by FactSet were on average expecting earnings of 41 cents per share.

Revenue was $15.04 billion, up 55 percent from $9.72 billion in the fourth quarter of 2010. The increase was due mainly to the acquisition of NBC Universal, which closed a year ago. Revenue rose 3 percent when factoring in NBC Universal in the previous-year figure.

Analysts had forecast revenue of $14.94 billion.

Comcast ended the quarter with 22.3 million video subscribers and 18.1 million broadband subscribers, keeping its position as the biggest supplier of both TV and Internet connections to U.S. households.

The cable provider said it was raising its annual dividend from 45 cents to 65 cents per share, and also authorized a new $6.5 billion stock buyback program. The company intends to buy back $3 billion in shares this year. The dividend is worth $1.8 billion to shareholders annually.

Comcast shares rose $1.27, or 4.7 percent to close at $28.52 Wednesday. They hit a four-and-a-half-year high of $29.05 earlier in the day.

For all of 2011, Comcast earned $4.16 billion, or $1.50 per share, up 14 percent from $3.64 billion, or $1.29 per share, in 2010.

Full-year revenue was $55.8 billion, up 47 percent from $37.9 billion in 2010.

By Salon Staff

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