Comcast Corp., the largest U.S. cable provider, had its biggest first-quarter increase in video subscribers in nine years, continuing to defy the trend of cord-cutting by luring users from rivals like AT&T.
The Philadelphia-based company gained 53,000 cable-TV customers in the quarter. Three analysts surveyed by Bloomberg had projected an average gain of 34,000. Profit excluding some items was 84 cents a share, beating analysts' projections of 79 cents a share.
The results show that competition from online-only video services like Netflix isn't affecting all pay-TV providers equally. Comcast is staving off the decline of the pay-TV business by rolling out its new X1 video platform, adding more on-demand programming, and trying to improve its customer service. The cable company's gain was AT&T's loss, with the phone carrier reporting a decline of 54,000 video subscribers last quarter.
Comcast, the parent of Universal Pictures, is in talks to acquire DreamWorks Animation SKG for more than $3 billion, according to a report in the Wall Street Journal citing people familiar with the discussions. Though a deal may not be reached, an agreement would probably lead to Comcast merging Universal with DreamWorks Animation, the Journal said Tuesday, citing people familiar with the discussions.
"The cable TV business is far from dead," Paul Sweeney, analyst at Bloomberg Intelligence, said in an e-mail. "While cord cutting and skinny bundles are a concern, Comcast has shown that aggressive marketing and product innovation in the form of X1 can drive subscriber growth."
Subscribers also flocked to Comcast's internet service, with 438,000 customer signups in the period, topping analysts' projections for 392,000.
Revenue rose 5.3% to $18.8 billion in the quarter, exceeding analysts' estimates of $18.6 billion The average monthly customer bill climbed 4% t to $146.15.
Revenue at the NBC Universal group, which includes the NBC broadcast network, cable channels such as USA and MSNBC, the Universal film studio and theme parks, rose 3.9% to $6.86 billion.
Advertising revenue at the cable networks was flat at $851 million, while total cable network revenue gained 4%. Broadcast network ad revenue was down 17% from the prior year, when NBC aired the Super Bowl.
The film unit generated $1.38 billion in sales during the quarter, down 4.3% from a year earlier, when "Fifty Shades of Grey" helped boost results.
-- Bloomberg News