Comcast Business, Wireless Post ‘Substantial’ Growth As Cable Giant Fails To Add Broadband Subscribers

The cable behemoth says it is planning on integrating mobile ‘into every sales channel.’ Meanwhile, the company is feeling the heat of competition in broadband after not adding new high-speed internet customers in a quarter for the first time.

Comcast CEO Brian Roberts

Unlike some of its service provider competition during second-quarter 2022, Comcast posted growth during its fiscal quarter that was driven by its five-year-old wireless service and its strong business services portfolio. The cable behemoth is leaning on its continued strength in these areas as competition in high-speed internet heats up, according to Chairman and CEO Brian Roberts.

While Comcast posted growth in broadband revenue, the company for the first time didn’t add new broadband customers in a quarter.

“Business services and wireless have been two substantial contributors to Cable’s financial strength and each still has lots of runway ahead,” Roberts said. “Mobile is an area where we really continue to be aggressive. … I think there’s more we can do as we integrate mobile in every single sales channel. Look for us to combine the best network with the best mobile service. What we won’t do is chase pricing down to the bottom. Mobile is a great addition [that’s] adding value.”

[Related: 5 Big Things To Know About Comcast’s Masergy Acquisition]

Comcast’s wireless segment continues to post impressive growth with revenue of $722 million, compared with $556 million in the same quarter a year ago, marking growth of 29.8 percent. Xfinity Mobile wireless has picked up 635,000 new lines during the current quarter.

Xfinity Mobile in fourth-quarter 2021 reached profitability on a stand-alone basis for the first time since it was launched, Roberts said. The Philadelphia-based company rolled out Xfinity Mobile for small businesses in an offering called Comcast Business Mobile in 2021.

Comcast’s Cable Communications unit—which includes high-speed internet, voice, video, wireless and business services—saw a 3.7 percent increase during the second quarter of 2022. The segment generated revenue of $16.60 billion compared with $16.00 billion in second-quarter 2021. Broadband posted a revenue increase of 6.8 percent to $6.11 billion, up from $5.72 billion a year ago. The company attributed the growth to increases in broadband, business services, wireless and advertising revenue, partially offset by decreases in video and voice.

Broadband Customers Drop

Comcast’s Cable Communications’ total customer relationships decreased by 28,000 to 34.4 million in the second quarter of 2022. The company is seeing growing competition for high-speed broadband, its most lucrative product. Roberts also attributed the overall customer relationship declines to the dramatic slowdown of moves across the Comcast footprint—the lowest since the start of the pandemic—and waning pandemic behaviors that had consumers investing in their home internet as they worked from home.

The cable giant’s business customer relationships, on the other hand, increased by 19,000.

Comcast’s Business segment pulled in $2.42 billion during the second quarter, putting up double-digit growth of 10.1 percent compared with $2.20 billion during 2021’s second quarter. The company’s business unit has been very successful in the small- to midsize-business space in the past decade with its connectivity services. Michael Cavanagh, Comcast’s senior executive vice president and CFO, said that the “healthy, organic growth” in the segment was driven by an increase in average rates, an increase in the number of customers receiving Comcast services, and the recent Masergy acquisition.

The cable giant closed its acquisition of Masergy in October in a deal that is helping Comcast build up its SD-WAN and cloud-based security chops and reach more enterprise customers.

For the quarter ended June 30, Comcast reported revenue of $30.02 billion, a 5.1 percent increase compared with second-quarter 2021’s result of $28.55 billion. Net income in the quarter totaled $3.40 billion, a 9.2 percent decrease from last year’s second-quarter $3.74 billion. The cable giant posted adjusted earnings per share of $1.01, up 20.2 percent compared with 84 cents per share for the same quarter of 2021.