Comcast's 2018 first quarter earnings report was nearly overshadowed by the cable giant revealing it had formalized its $30.7 billion bid for Sky Plc, Britain's largest pay-TV broadcaster.
By officially throwing its hat in the ring for Sky, Comcast is going head-to-head with 21st Century Fox with an offer worth 12.50 pounds per share in an all-cash deal, besting Fox’s 10.75 pound per share bid for Sky.
"We have been impressed with the continued momentum of the company, and the ability to have a content distribution company that looks very similar to Comcast's NBC Universal," Comcast Chairman and CEO Brian Roberts told investors on the earnings call Wednesday.
But despite putting its binding offer on the table for the British media and TV provider, Comcast is still intently focused on its core businesses, including its ever-strengthening cable and connectivity services portfolio, Roberts said.
"When we talk to customers, we lead with broadband, and then we complete the package. This is how we compete in the marketplace … it's just where our focus is," he said.
Overall, cable communications revenue climbed 3.6 percent to $13.52 billion during the first quarter ended March 31, up from $13.05 billion in first-quarter of 2017. Comcast attributed the growth to the company's high-margin connectivity offerings, specifically high-speed internet and business services.
Comcast's business services revenue once again shined with double-digit growth, jumping up 11.9 percent from $1.73 billion in the first quarter compared to $1.54 billion for the same quarter a year ago. The company said it added about 29,000 new business customers in Q1 2018.
Combined, Comcast's residential and business connectivity businesses have reached a nearly $24 billion annual run rate, and both segments have "significant runway ahead," Roberts said. Today, Comcast has more than 10,000 technical and sales employees dedicated to its business services efforts, he added.
Michael Cavanagh, Comcast's senior executive vice president and CFO, said that while the company continues to thrive in its small-to-midsized business customer base, it's also making strides with enterprise customers.
"Our investment in pushing fiber deeper into the network helps us continue to increase the number of [larger] customers," he said.
Cavanagh also said that Comcast's cable business continues to grow as existing customers get more out of their subscriptions. In fact, revenue per customer increased by more than 5 percent during the quarter.
Comcast's Xfinity Mobile, a wireless service available to broadband internet subscribers as part of a bundled offering, has been available to customers for about a year now. While the company hasn't disclosed specific revenue numbers around the wireless service, Roberts said Xfinity Mobile ended the quarter with about 577,000 customer lines, adding 196,000 customer lines during Q1.
Xfinity Mobile did however post a $189 million loss for the first-quarter, which reflects operating costs associated with getting the new business launched, Cavanagh said.
Comcast last week announced a relationship with fellow cable giant Charter Communications that will have the two companies develop a backend mobile platform to support both Xfinity Mobile and the soon-to-launch Spectrum Mobile service. The partnership will help Comcast scale its wireless offering faster and give both providers room to better compete in the crowded market, Roberts said.
Comcast has not yet made Xfinity mobile available through the channel.
Revenue in the first quarter grew to $22.79 billion, up 10.7 percent from $20.59 billion in the year-ago quarter. Net income in the quarter was $3.12 billion, up 21.2 percent from $2.57 billion in the first quarter of 2017. The cable giant posted adjusted earnings of 62 cents per share for the quarter, up 17 percent over 53 cents per share in the first quarter of 2017.