Cable operator

Insight Communications

(ICCI)

beat estimates for the second quarter, largely from improving business in high-speed Internet and high-end video services.

Reporting results after the market closed Tuesday, the company repeated its forecast to hit breakeven on free cash flow -- that is, cash flow after capital expenditures and interest expenses have been subtracted -- by the end of 2003. The company's results might offer a sliver of hope to investors whipsawed by

the malaise that hit cable stocks Tuesday.

The mass selloff took flight after

AT&T

(T) - Get Report

took a $13.1 billion pretax charge for a writedown in the value of its AT&T Broadband cable subsidiary. Insight fell 12.4% to close at $10.60, well off its 52-week high of $26.91. Insight, which operates cable systems half-owned by AT&T, didn't trade after hours.

Insight also has to contend with First Albany's initiation of coverage with a neutral rating on the stock Tuesday. Analyst Youssef Squali noted the company had high margins for earnings before interest, taxes, depreciation and amortization, a common bottom-line yardstick in the cable industry. But Squali also said the company, hampered by a complex capital structure, was already "fairly valued" when his report was released Tuesday morning.

For the second quarter ended June 30, Insight reported revenue of $200 million, just topping analysts' estimates, as surveyed by Thomson Financial/First Call, of $199.9 million. Revenue for the second quarter of 2001 was $181.2 million. Net loss to common shareholders amounted to $11.6 million, or 19 cents per share, compared to the year-ago loss of $26.7 million, or 44 cents per share, edging past analysts' estimates of a 20-cent loss per share.

Insight reported a basic sub loss of 10,900 over the three months ended June 30, smaller than the 14,900 loss one year earlier. The second quarter is traditionally the weakest for cable systems, as far as basic subscriptions go.

Excluding the gain in revenue from a unit not included in year-ago results, Insight said the sales increase came from improvements in high-speed data revenue, up 66% over the second quarter of 2001, and digital video, up 43%.