NEW YORK (Reuters) - Time Warner Cable Inc TWC.N posted a third quarter profit that beat expectations, as growth in sales of voice and Internet services overshadowed a decline in basic video subscribers, the company said on Thursday.
The second largest U.S. cable operator lost more video subscribers than expected by analysts but its voice and Internet subscriber growth helped profits and revenue outperform Wall Street’s forecasts.
Time Warner Cable said total video subscribers in the third quarter declined by 84,000. Collins Stewart analyst Thomas Eagan had been expecting losses of 65,000.
The company added 117,000 Internet subscribers and 62,000 residential phone subscribers. Eagan had forecast 102,000 Internet subscribers 95,000 phone subscribers.
Revenue from its high speed Internet users rose 8 percent, while revenue from customers who pay for its phone service rose 14 percent.
Net income fell to $268 million, or 76 cents a share, from $301 million, or 92 cent a share, a year earlier.
The profit narrowly beats analysts average expectations of 75 cents a share, according to Thomson Reuters I/B/E/S.
Revenue rose 4 percent to $4.5 billion.
Time Warner Cable’s stock has more than doubled since March, leading investors to dump the stock of Comcast Corp (CMCSA.O) in favor of its smaller rival, said Collins Stewart analyst Thomas Eagan.
“We’re going to continue to see rotation out of Comcast to Time Warner Cable,” said Eagan, who downgraded Comcast on Wednesday. “There is less acquisition risk at Time Warner Cable and we expect that they will soon start paying out a dividend.”
Reporting by Franklin Paul and Yinka Adegoke; Editing by Derek Caney