Comcast Corp. 2Q Profit Climbs 8 Percent

July 30, 2008 6:25:02 AM PDT
Comcast Corp. said Wednesday its second-quarter profit rose 8 percent as cable TV rates rose and consumers ordered more digital and premium services. But that was still shy of Wall Street's forecast. The second quarter is traditionally slower for the company because snowbirds and students disconnect their cable for the summer.

Philadelphia-based Comcast posted second-quarter net income of $632 million, or 21 cents per share, compared with $588 million, or 19 cents per share, in the quarter a year earlier.

Revenue rose 11 percent to $8.55 billion.

Analysts polled by Thomson Financial were expecting, on average, slightly higher profit of 23 cents per share on revenue of $8.54 billion.

Operating cash flow was up 8 percent to $3.36 billion. But free cash flow more than tripled to $1.16 billion in the quarter, after Comcast cut its capital expenditures by 20 percent.

The company said its spending on wiring new communities has fallen 50 percent in the housing slump. Last year, the company also spent money meeting the federal July 1 deadline that required cable operators to start using new boxes with separable security.

Comcast lost 138,000 basic subscribers in the quarter but added 320,000 digital customers. Total video revenue was up 3 percent to $4.73 billion. Video customers on average paid $63.98 a month, up 4 percent.

High-speed Internet added 278,000 new subscribers, down 18 percent from 2007. Revenue was up, however, by 10 percent to $1.8 billion. Customers on average paid $42.01 a month, down 3 percent.

Digital voice added 555,000 net new customers, down 20 percent from a year ago, but revenue also was up 77 percent to $636 million. Customers paid $39.48 a month on average, down 7 percent.

Comcast also reaffirmed its previous guidance for an 8 percent to 10 percent increase in revenue and operating cash flow for 2008. It also expects free cash flow to increase 20 percent or more.