* First-quarter EPS 93 cents vs 60 cents year earlier
* Adds 189,000 high-speed Internet customers
* Loses 65,000 basic video customers, continuing trend
(Adds analyst comment)
By Paul Thomasch
NEW YORK, April 28 Time Warner Cable Inc's
TWC.N quarterly profit rose 52 percent, fueled by a stronger
advertising market and a big jump in subscriptions to its
high-speed Internet service.
Time Warner Cable's success in signing up more customers to
its Internet and phone services softened the blow of the
continuing loss of TV customers and lifted shares 1 percent to
a 52-week high.
The No. 2 U.S. cable television operator dropped 65,000
basic video customers during the first quarter, but it is
hardly alone. The entire cable industry faces competition for
video customers from phone and satellite providers, not to
mention Internet-based upstarts such as Netflix Inc (NFLX.O)
Time Warner Cable has responded by expanding its presence
in other areas, particularly high-speed Internet, where it
added a better-than-expected 189,000 customers. Most analysts
figured it would add closer to 125,000 to 165,000. Subscribers
additions to its phone service also slipped by expectations at
Chief Executive Glenn Britt said its high-speed Internet
service "is quickly becoming the anchor product in the eyes of
consumers," and noted the service now has more than 10 million
In light of those sorts of numbers, analysts and investors
appeared to accept the loss of more video customers,
particularly in the small number of cases when customers are
dropping TV subscriptions to watch video over the Web, known as
Craig Moffett, an analyst with Bernstein Research, said in
a note that "investors have grown more comfortable with the
view that cable is, first and foremost, an infrastructure play,
and that its broadband business will serve as a near perfect
hedge against" cord-cutting.
Time Warner Cable's first-quarter income rose to $325
million, or 93 cents a share, from $214 million, or 60 cents a
share, in the same period a year ago.
Adjusted for items, including the tax impact of expired
stock options, the company's earnings of $1.01 a share
surpassed the average analyst estimate of 98 cents a share,
according to Thomson Reuters I/B/E/S.
Revenue increased 5 percent to $4.8 billion, reflecting the
solid subscriber numbers and strong advertising sales. That was
largely in line with expectations.
Shares of Time Warner Cable rose 48 cents to $75.76.
(Reporting by Paul Thomasch, editing by Gerald E. McCormick,
Dave Zimmerman and Derek Caney)