NEW YORK – Cable and entertainment company Comcast Corp posted higher third-quarter revenue on Wednesday, fueled by video customer additions and sustained growth in its high-speed internet and business services divisions.
Continue Reading Below
Pay-TV operators have been competing against streaming video services, such as Netflix Inc , which have been luring customers away from cable and satellite TV with lower-priced offerings. To tackle the threat, Comcast has been expanding its internet business and investing in media assets, including "Kung Fu Panda" and "Shrek" producer DreamWorks Animation.
Similar to Comcast's acquisition of media company NBCUniversal in 2011, AT&T Inc said on Saturday it would buy Time Warner Inc for $85.4 billion. Telecom companies are eyeing media businesses to tap new revenue through digital content distribution, as their core business declines.
Comcast, which is both the largest U.S. cable operator and the No. 1 U.S. high-speed internet provider, said total revenue rose 14.2 percent to $21.32 billion in the third quarter ended Sept. 30. Analysts on average had forecast revenue of $21.16 billion, according to Thomson Reuters I/B/E/S.
Net income attributable to Comcast grew 12.1 percent to $2.24 billion from a year ago. Excluding certain adjustments, profit was 92 cents per share, beating the average analyst estimate by a penny.
Philadelphia-based Comcast added 32,000 video subscribers July through September, compared to a loss of 48,000 users a year earlier.
Continue Reading Below
To keep its pay-TV subscribers, Comcast has been enhancing its X1 set-top box to let viewers search shows and movies easily, expanding its on-demand library and improving its customer service. Last month, through a beta test, it began letting customers stream Netflix through its X1 cable-TV service.
Revenue from its high-speed internet business rose 8.8 percent to $3.4 billion in the quarter, while customer additions rose 3.1 percent to 330,000. Business services revenue increased 15.5 percent to $1.39 billion.
Revenue from its NBCUniversal division, which includes the NBC television network, film studios and theme parks, grew 28.3 percent to $9.18 billion, helped by the broadcast of the 2016 Rio Olympics.
The Universal film studio's revenue fell 6.1 percent to $353 million due to the lukewarm response to third-quarter releases, including "Jason Bourne" and "The Secret Life of Pets." A year ago it benefited from its blockbuster hit "Minions."
Revenue at Universal theme parks rose 62.4 percent to $706 million, boosted by Harry Potter attractions and the addition of Universal Studios Japan. Comcast bought a majority stake in the Japanese studio for $1.5 billion in late September last year.
Shares of Comcast closed at $64.52 on Tuesday on the Nasdaq.
(Reporting by Malathi Nayak; Editing by Bernard Orr)