Charter Communications, whose purchase of Time Warner Cable and Bright House Networks this year made it the second-largest U.S. cable provider, posted second-quarter revenue that beat analysts' estimates after adding internet users.
Revenue rose 6.6% to $10 billion, the cable operator backed by billionaire John Malone said in a statement Tuesday. Analysts anticipated $9.94 billion, the average of projections compiled by Bloomberg.
Charter won final regulatory approval in May for its $55 billion takeover of Time Warner Cable and Bright House Networks, a smaller cable provider. Stamford, Conn.-based Charter gained 13 million customers in cities like New York, Los Angeles and Dallas, and now ranks behind only market leader Comcast Corp.
Charter is trying to find ways to sign up more people for cable amid competition from online streaming services. The company lost 152,000 video subscribers in a seasonally weak period when college students typically disconnect their service for summer vacation. Two analysts surveyed by Bloomberg predicted the newly-combined Charter would lose, on average, 65,500 video subscribers.
In the same quarter last year, Charter shed 170,000 video customers, factoring in if it had already been combined with the other two companies.
Charter had been gaining momentum in its video business, adding 15,000 subscribers in the first quarter compared with a loss of 12,000 during the same period last year.
At the same time, Charter's ability to sign up new internet subscribers continues to drive sales growth. The company added 236,000 residential internet subscribers in the quarter, compared with 157,000 a year earlier. The two analysts surveyed by Bloomberg predicted 280,000 on average. As of June 30, Charter had 20.7 million residential internet customers, trailing Comcast's 23.9 million.
Comcast, which reported second-quarter results last month, lost 4,000 cable-TV customers, compared with a drop of 69,000 a year earlier. The cable operator also added 220,000 internet customers, the most for a second quarter in eight years.
Charter's net income of $3.1 billion, or $15.17 a share, compared with a loss of $122 million, or a loss of $1.21 a year earlier, driven by the closing of the Time Warner and Bright House deals. Adjusted earnings before interest, taxes, depreciation and amortization grew 9% to $3.54 billion, beating analysts' estimates of $3.49 billion. Average monthly residential revenue per customer was $109.09, a 1% increase from a year earlier. On a pro forma basis, internet revenue increased 12% to $3.1 billion.
-- Bloomberg News