Time Warner Cable Q3 Earnings Up On One Time Gains But Fall Short Of Forecasts
The No. 2 cable operator lost more video subscribers, and gained fewer broadband ones, than analysts expected in a quarter when the company collected $1.1B from spectrum sales to Verizon Wireless. With everything included, Q3 net income came in at $808M, +127% vs last year, on revenue of $5.63B, +9.2%. Revenues exceeded the consensus forecast of $5.39B. But if you strip out the one-time gains, earnings came in at $1.41 a share, below the Street’s $1.43 projection. Programming costs equaled $31.45 per video customer, +6.1%. Time Warner Cable ended the quarter with 12.2M video subscribers, down 140,000 from the end of June; analysts expected something more around -130,000. Meanwhile, the company added 85,000 residential broadband customers, bringing the total to 10.9M. Wells Fargo Securities’ Marci Ryvicker thought the improvement would be closer to 89,000. The number of residential phone subscribers stayed flat at about 5M, a little better than expected. Ryvicker says the numbers were “somewhat messy” — and that the Street’s expectations may have been too high after seeing Comcast’s strong Q3 numbers. “Our third quarter results were good, with most trends similar to the proceeding quarter,” CEO Glenn Britt says. He adds that the company remains “focused on investing in growing our business, while at the same time ramping up capital returns to our shareholders.”
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