Time Warner Cable Second-Quarter Earnings Rise, Subs Drop

Sylvain Gaboury/PatrickMcMullan.com/Sipa Press/Newscom
Time Warner Cable CEO Glenn Britt

UPDATED: The second-largest U.S. cable company continued to lose video subscribers as outgoing CEO Glenn Britt discusses chatter about industry consolidation.

Cable operator Time Warner Cable reported higher second-quarter financials on Thursday.

It lost 191,000 residential video subscribers in the quarter, though, which is seasonally the slowest for pay TV companies. That compared to a year-ago drop of 169,000. And it added only 8,000 broadband customers in the latest period, compared with 59,000 a year earlier.

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The company, led by CEO Glenn Britt, who will retire at the end of the year and make way for current COO Rob Marcus, said its adjusted quarterly earnings amounted to $497 million, compared with $466 million in the year-ago period. That was a gain of 6.7 percent and exceeded analysts' estimates.

Revenue of $5.55 billion was up 2.7 percent. That figure came in below Wall Street expectations.

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TW Cable is currently in a carriage dispute with CBS Corp. The two companies have agreed to continue negotiating a new retransmission consent and network-carriage agreement with a Friday afternoon deadline.

Britt didn't share the latest on where the talks stand, even when someone asked him about his hoarse voice and whether that was due to his having to yell at CBS Corp. CEO Leslie Moonves. Quipped Britt: "I knew somebody was going to ask that." Marcus said the cable giant's goal was to ensure "reasonable" prices for subscibers.

Britt also addressed recent discussions about possible consolidation in the industry, with TW Cable at the center of it amid talk that Charter Communications, in which John Malone's Liberty Media owns a stake, could drive deals. Britt said TWC's role in the chatter is "really an endorsement of the value" of its assets.

He also signaled that TW Cable would rather be a buyer than seller, saying the company has always been disciplined about deals, and "consolidation is a worthwhile endeavor. But our objective is and will be to create value for our shareholders."

However, Marcus later said that whether TWC ended up acquiring or selling, "the mindset is pretty much the same, which is creating value for shareholders."

Asked about possible a la carte offerings of networks, he said he likes "more choice" for consumers. "Whether that involves a one-on-one choice of networks remains to be seen."

TW Cable's stock rose slightly.

E-mail: Georg.Szalai@THR.com
Twitter: @georgszalai