Time Warner Cable Posts Smallest Quarterly Video Sub Drop in Five Years
UPDATED: The company, which has agreed to be acquired by cable giant Comcast, also posted its best overall residential subscriber performance in five years.
Time Warner Cable on Thursday said it lost 34,000 residential pay TV subscribers in the first quarter, down from 119,000 in the year-ago period and 217,000 in the fourth quarter.
Management also said it remains focused on returning to quarterly video subscriber growth down the line, saying its sub momentum improved throughout the first quarter and it even added video subs in March.
TW Cable said it was its smallest drop and its best overall residential subscriber performance in five years. Residential customer relationships saw a net gain of 148,000 in the first quarter, the company's highest number in more than seven years, TW Cable said.
The company, whose $45 billion deal to be acquired by Comcast is being reviewed by regulators, said it ended the quarter with more than 11.16 residential video subscribers.
Residential broadband subscriber additions also came in at their highest level since the first quarter of 2008 and telephony user growth was the highest since the first quarter of 2012.
TW Cable, led by CEO Rob Marcus, has in recent months touted improving subscriber momentum. Earlier this week, Comcast reported its second quarterly video subscriber gain in a row.
"I’m very pleased with our performance this quarter," said Marcus. "Our residential subscriber growth was the best in five years, and our business services revenue growth was close to 25 percent. These results underscore our commitment to deliver on our financial and operating plan as we prepare for our merger with Comcast."
TW Cable on Thursday also posted adjusted first-quarter earnings of $503 million, up 18.9 percent from a year ago, exceeding analysts' estimates. Revenue rose 2 percent to $5.58 billion, slightly below Wall Street expectations.
Costs related to the Comcast deal amounted to $62 million in the latest quarter, including $29 million in costs for employee retention and $33 million in legal fees.
During an earnings conference call, Marcus said "our entire team has remained laser-focused" on the execution of the company's business plan despite the planned Comcast deal.
He said the regulatory review process of the Comcast merger is going as planned with a closing, if approved, likely by year's end. And he said Comcast and TW Cable continue to be excited about the benefits of the deal.