This counts as good news in pay-TV: Comcast Corp., the largest U.S. cable-TV provider, said Wednesday that fewer video subscribers than expected had canceled their service.
The company lost 4,000 cable-TV customers in the quarter, compared with a drop of 69,000 a year earlier. Three analysts surveyed by Bloomberg had projected a loss of 42,000 in a seasonally weak period when college students disconnect their cable service for summer vacation.
Comcast cable's ad revenue, from the small slice of time it gets to sell on the channels it carries, increased 3.5% over the period a year prior because of growth in political ad revenue, the company said.
Comcast also signed up 220,000 internet customers, the most for a second quarter in eight years, exceeding predictions of about 192,000. As more people watch videos online instead of on TV, selling broadband has become a growing business for cable companies.
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, fell 1.8% to $7.1 billion. The previous year's results didn't include Comcast's 51% stake in Universal Studios Japan, which it acquired in November.
Ad revenue at the cable networks was flat because higher ad prices in the so-called scatter market were offset by shrinking audiences, the company said. Total cable network revenue including carriage fees from pay-TV distributors gained 4.7%.
Broadcast network ad revenue was up 2.9% from a year earlier as higher rates were only "partially offset" by ratings declines, according to Comcast.
Profit excluding some items was 83 cents a share, Philadelphia-based Comcast said. Analysts had predicted 81 cents, the average of estimates compiled by Bloomberg. Comcast's film business faced a tough comparison from a year earlier when it released "Furious 7" and "Jurassic World," two blockbusters that grossed more than $1 billion each at the box office. In April, Comcast, the parent of Universal Pictures, agreed to buy DreamWorks Animation SKG Inc. for $3.8 billion.
Comcast shares advanced 3% to $69.20 at 8:07 a.m. in early New York trading Wednesday. The stock had risen 19% this year through Tuesday's close.
Comcast is grabbing market share from satellite and phone providers by rolling out its new X1 video platform. The service, which has been introduced in about 40 percent of its footprint, makes it easier to search for shows and movies and offers more content on demand, helping Comcast retain cable subscribers.
The company is enhancing its video service with a recent deal to let customers stream Netflix Inc.'s web video content on X1. To lure more customers, Comcast plans to start selling prepaid TV and internet service to people who normally wouldn't qualify by waiving rules requiring a credit check or signed contract.
Total revenue rose 2.8% to $19.3 billion in the quarter, edging out analysts' estimates of $19 billion. Net income for the quarter was $2.03 billion, down 5% from a year earlier.
The average monthly customer bill climbed 3% to $147.99.
The film unit generated $1.35 billion in revenue during the quarter, down 40% from a year earlier when it had that stronger film slate.
Revenue in the business services division, which sells phone, web and video services to companies, rose 17% to $1.36 billion.
The cable operator paid $670 million in dividends in the quarter, a 6.6% increase from the year-earlier period, and bought back $1.14 billion in stock.
-- Bloomberg News with Ad Age staff