(Reuters) - Comcast Corp reported first-quarter profit on Thursday that beat Wall Street estimates, boosted by additions of high-speed internet customers in a quarter that painted a mixed picture for the biggest U.S. cable provider.
The company’s shares were up 3 percent in morning trading after falling as much as 3 percent premarket following the earnings release.
Chief Executive Brian Roberts said the company, which purchased British pay-TV group Sky last year, is exploring the launch of a global NBC-Sky news network, but did not give any details.
Overall revenue missed analyst estimates and Comcast lost more video and phone customers than expected. Revenue from its NBCUniversal cable networks, filmed entertainment and theme parks also fell short of expectations.
Earnings per share, led by the strongest profit growth in its cable division in a decade, still exceeded expectations.
Like others in the cable television industry, Comcast is grappling with competition from Alphabet Inc’s YouTube TV and subscription video services like Netflix Inc.
Earlier this week AT&T Inc and Verizon Communications Inc both reported losing more video customers than analysts expected.
Philadelphia-based Comcast said it lost 121,000 video customers in the quarter, more than the 29,000 it shed last quarter and the 109,000 estimated by analysts, according to research firm FactSet. In response, the company is striving to build new services on top of its broadband network.
But recent price increases from AT&T and YouTube TV could be good for traditional pay-TV companies.
“There was a bit of excitement as everybody rushed into the business over the last year or so, and that excitement now is going away,” Steve Burke, CEO of NBCUniversal, said of tech companies’ incursion into the pay-TV business.
Revenue from the high-speed internet business climbed 10 percent to $4.58 billion in the first quarter as the company added 375,000 subscribers on a net basis.
Subscriber additions beat the average analyst estimate of 356,000, according to FactSet, but were down slightly from 379,000 in the same period a year earlier.
Comcast is betting that its redesigned Xfinity X1 cable box, which uses a single menu to find content across live TV, on-demand and streaming services like Netflix, will help retain and attract subscribers confused over how to navigate myriad new digital TV offerings.
Revenue at its NBCUniversal business, which includes NBC Entertainment and Universal Pictures, dropped 12.5 percent to $8.31 billion.
NBCUniversal plans to launch an advertising-supported TV streaming service in 2020 that will be free for NBCUniversal’s pay-TV customers as well as Sky customers internationally.
Filmed entertainment revenue rose 7.4 percent to $1.77 billion, boosted by movies including “How to Train Your Dragon: The Hidden World” and “Us” while theme park revenue slipped 0.4 percent to $1.28 billion.
Revenue from broadcast television dropped 29.4 percent year-on-year to $2.47 billion. Excluding last year’s Olympics and Super Bowl from the prior-year comparison, however, revenue rose.
Sky revenue fell 5 percent to $5 billion. On a constant-currency basis, revenue rose by nearly 2 percent.
Comcast’s overall revenue rose 18 percent to $26.86 billion, but fell short of Wall Street expectations of $27.20 billion.
Excluding items, the company earned 76 cents per share, beating estimates of 68 cents per share, according to IBES data from Refinitiv.
Reporting by Helen Coster, Arjun Panchadar and Kenneth Li; Editing by Meredith Mazzilli and Steve Orlofsky
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