Comcast Cable, Business Segments Ride High On Record-Breaking Internet, Wireless Revenues
Comcast is working on putting COVID-19 in its rear view as cable, business services, and its four-year old wireless service continued their upward trajectory and high-speed internet posted double-digit growth.
Comcast is breaking subscriber records both in its high-speed broadband and its four-year old wireless service as the cable behemoth continues to make its core network its “number one priority,” according to Comcast Chairman and CEO Brian Roberts.
Driven by broadband, Comcast’s Cable Communications segment had its best first-quarter result on record for total customer relationships, adding 380,000 new business and residential users. The segment now has 33.5 million customers. The company added 461,000 high-speed internet customers.
“We certainly got off to a great start this year,” Roberts told investors during the carrier’s fiscal first-quarter 2021 conference call Thursday morning. “We, once again, had particularly strong results in cable, which posted its third consecutive quarter of double-digit growth.”
Comcast’s Cable Communications unit—which includes high-speed internet, voice, video, wireless and business services—saw a bump of 5.9 percent during first-quarter 2021. The segment generated revenue of $15.81 billion compared with $14.92 billion in the same quarter a year ago. High-speed internet posted a double-digit revenue climb of 12.1 percent to $5.81 billion, up from $4.92 billion a year ago.
The first quarter this year marked the lowest broadband churn in the company’s history, according to Michael Cavanagh, Comcast’s CFO.
Under Tony Werner, Comcast’s retiring CTO, the company has engineered its network to anticipate change, Roberts said. Comcast will be continuing that work under Charlie Herrin, most recently Comcast’s chief product officer. Comcast is in the midst of virtualizing its network and moving functions into the cloud, which is reducing innovation cycles from years to months, he said.
“We’re also automating many of our core network functions so that we can deliver instant capacity, as well as identify and fix network issues before they ever affect a customer,” Roberts said.
Comcast has invested nearly $30 billion in the last decade in its fiber-dense network, which today includes 191,000 route miles, Roberts said.
Comcast’s Business segment continued to shine, pulling in $2.17 billion during the first quarter, up 6.1 percent from $2.04 billion during 2021’s first quarter. The company’s Business unit has historically been very successful in the small- to midsize-business space with its connectivity services and that trend continued in Q1 2021. The company attributed its revenue success in its business segment to growth in demand from SMBs, a sign that small businesses are bouncing back from the coronavirus pandemic. The company added 11,000 net new business customers during the quarter.
Comcast’s wireless service, Xfinity Mobile, also continued its momentum with its best quarterly result on record. The wireless segment grew 49.7 percent during the first quarter with revenue of $513 million compared to $343 million a year ago. In fact, the wireless segment reached breakeven for the first time since its launch in 2017. Total customer line net additions were 278,000, according to Philadelphia-based Comcast.
Another bright spot for the cable giant: Netflix rival Peacock, which debuted in 2020. The video streaming service now has 42 million subscribers to date compared to 33 million sign-ups across the U.S. just last quarter, Q4 2020, the company said.
The company’s NBCUniversal segment, which includes theme parks, continued to take the biggest hit due to COVID-19 with overall revenue declining year over year by 9.1 percent to $7.02 billion. Theme park revenue fell 33.1 percent, which the company attributed to park closures and capacity reductions in the U.S. and China. However, Comcast executives said that “the demand is there” for its parks and entertainment as more locations start to safely reopen, including Universal Studios in Hollywood.
For the quarter which ended on March 31, Comcast reported revenue of $27.21 billion, a 2.2 percent increase compared with first-quarter 2020’s result of $26.70 billion. Adjusted net income in the quarter was $3.53 billion, a 8.1 percent bump up from last year’s first-quarter ending balance of $3.27 billion. The cable giant posted adjusted earnings per share of 76 cents, up 7 percent compared with 71 cents per share for the same quarter in 2020.