It had to happen. In a media world characterized by more declining fortunes than you'd find at a gamblers' ball, Comcast (Nasdaq: CMCSA ) has been riding its triple-play package to almost unbelievable results during the past two years. But when management had the temerity not to raise guidance in tandem with releasing June results on Thursday, the company's shares fell 4.7% on the day.
Nevertheless, its numbers were generally excellent. Earnings came in at $588 million, up 27.8% from the $460 million a year ago. Diluted per-share earnings increased to $0.19, from $0.15 last year. Revenue rose 30.5% to $7.71 billion.
But despite the market's apparent disappointment that forward guidance was left unchanged and the company's share buyback program (under which it had bought 27.9 million shares for $752 million in the quarter) was not expanded, the triple play package of video, high-speed data, and telephone services continues to result in big subscriber additions. In the quarter, revenue generating unit (RGU) additions -- an RGU is one subscriber taking one service from the company -- were up 94% year over year to 1.6 million.
The company's digital cable subscriber additions reached 823,000 in the June period, up 144% from the year-ago contingent. Part of that growth was induced by an effort at Comcast to beat a July 1 deadline set by the FCC for shipping net set-top boxes with separable cable cards. The deadline was set to encourage a new retail market for the boxes.
High-speed data additions did dip, although by less than 1% in the quarter, while the number of digital-phone customer additions just about doubled to 671,000. At the same time, the programming segment, which operates such cable channels as E! Entertainment, The Golf Channel, and VERSUS, raised its revenue by 22% to $334 million.
But enough about the numbers. What's the takeaway on Comcast at this point? First, I believe that the company's results for the quarter overall were very strong and that it's one of the nation's better management entities, regardless of industry. Not to mention that Comcast -- along with other cable operators such as Time Warner Cable (NYSE: TWC ) and Charter (Nasdaq: CHTR ) -- are sitting in the competitive catbird's seat relative to satellite video providers DirecTV (NYSE: DTV ) and EchoStar (Nasdaq: DISH ) and the triple-play packages offered by telecoms AT&T (NYSE: T ) and Verizon (NYSE: VZ ) .
As long as the cable guys don't fritter away those leads, they (and particularly Comcast) seem to warrant careful attention from Foolish investors with a media bent.
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Fool contributor David Lee Smith is a new cable triple-play customer, but he owns nary a share of any of the companies mentioned. He welcomes your comments or questions. The Motley Fool has a disclosure policy.
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