Comcast Corp. (CMCSA) reported solid financial results for second-quarter 2013. The company’s triple-play voice, video and data bundled offerings are still gaining market traction. However, the company continues to lose video subscribers. Comcast currently has a Zacks Rank #3 (Hold).
Second-Quarter Results in Detail
GAAP net income for the second quarter of 2013 was $1,734 million or 65 cents per share compared with $1,348 million or 50 cents per share in the prior-year quarter. Quarterly earnings per share of 65 cents outpaced the Zacks Consensus Estimate of 63 cents. Total revenue came in at $16,270 million in the reported quarter, up 7% year over year, surpassing the Zacks Consensus Estimate of $16,022 million.
Quarterly operating costs and expenses were $10,845 million, up 6.3% year over year. However, quarterly operating income was $5,425 million, representing an annualized growth of 8.4%. Operating margin was 33.3% compared with 32.9% in the prior-year quarter. During the second quarter, Comcast repurchased 12.6 million of its common shares for $500 million and paid dividends totaling $514 million.
During the second quarter of 2013, Comcast generated $5,425 million in cash from operations compared with $5,004 million in the year-ago quarter. Consolidated free cash flow in the reported quarter was $1,948 million compared with $1,554 million in the prior-year quarter.
Cash and marketable securities, at the end of the first half of 2013, were $5,154 million compared with $12,415 million at the end of 2012. Total debt at the end of the first half of 2013, was $46,649 million compared with $40,458 million at the end of 2012. At the end of the reported quarter, the debt-to-capitalization ratio was 0.47 compared with 0.43 at the end of 2012.
Cable Communications Segment
Quarterly total revenue was $10,467 million, up 5.8% year over year. Operating cash flow was $4,335 million, up 5.7% year over year. Within this segment, Video revenues were $5,175 million, up 2.7% year over year. High-Speed Internet revenues were $2,569 million, up 8% year over year. Voice revenues were $910 million, up 2.4% year over year. Advertising revenues were $558 million, up 1.2% year over year. Business Services revenues were $788 million, up 26.4% year over year. Other revenues were $467million, up 12.3% year over year.
Cable TV operators are gradually loosing video subscribers to large telecom operators, such as Verizon Communications Inc. (VZ) and AT&T Inc. (T) and online video streaming service providers like Netflix Inc. (NFLX). Despite this, Comcast has been able to slow down its video subscriber losses.
On Jun 30, 2013, Comcast had 19.986 million (up 6.7% year over year) High-Speed Internet customers; 10.327 million (up 6.9% year over year) Voice customers; and 21.776 million (down 1.6% year over year) Video customers.
In the reported quarter, Comcast lost a net 159,000 video customers compared with a net loss of 176,000 video customers in the prior-year quarter. The company added a net 187,000 High-Speed Internet customers compared with 156,000 in the year-ago quarter. Similarly, Comcast added a net 161,000 voice customers compared with 158,000 in the prior-year quarter.
NBC Universal Segment
Quarterly total revenue was $5,995 million, up 8.9% year over year. Operating cash flow was $1,191 million, signifying a 21.3% year-over-year increase. Within this segment, Cable Networks revenues were $2,413 million, up 7.7% year over year. Broadcast TV revenues were $1,732 million, up 11.6% year over year. Filmed Entertainment revenues were $1,388 million, up 12.8% year over year. Theme Parks revenues were $546 million, up 1.1% year over year.
More From Zacks.com