Time Warner Cable
notched a better-than-expected profit in the second quarter, although revenue fell short of forecasts.
The New York-based cable provider said Wednesday net income was $277 million, or 28 cents a share, rising slightly from $272 million, or 28 cents a share, in the year-ago period. Excluding certain items, Time Warner Cable had a profit of 34 cents a share, which exceeded the Thomson Reuters average estimate by 2 cents.
Revenue in the second quarter increased 7% from a year ago to $4.3 billion, as a net increase in digital phone subscribers boosted total sales. However, Wall Street was looking for revenue of $4.33 billion, according to Thomson Reuters.
In addition to an increase in digital phone revenue, subscription revenue grew 7% to $4.1 billion, video revenue were up 2% to $2.6 billion, and high-speed Internet revenue rose 12% to $1 billion.
Time Warner Cable said it had a net addition of 656,000 revenue-generating units, or RGUs, from the previous quarter. The company's Triple Play bundle subscriber count had 214,000 net additions and surpassed the 2.8 million mark.
Despite net additions in digital video, high-speed data and digital phone subscribers, Time Warner Cable saw a sequential decline of 9,000 basic video subscribers. Additionally, the company's basic video penetration rate slipped to 49.8% from 50% in the first quarter.
Time Warner Cable's decline in basic video subscribers comes as no surprise though, as several of its cable business rivals have also seen numbers dwindle. In its second-quarter report,
said that basic video customers fell by 44,800 while digital video customers increased by only 33,900. By comparison,
also said its basic video subscriber count fell by 138,000 in the second quarter, although it added 320,000 digital cable subscribers as customers swap to digital boxes.
Looking forward, the company lowered its full-year profit forecast in part to reflect costs related to its planned separation from parent company
. Time Warner Cable now expects EPS in a range of $1.10 to $1.15 a share. Analysts are looking for earnings of $1.27 a share, according to Thomson Reuters data.
Shares of Time Warner Cable were lately down 19 cents, or 0.6%, at $29.71.