Tuesday, February 17, 2009

Comcast's 2009 Plan Calls for All-Digital, More DOCSIS 3.0

For Q4 2008, Comcast's net revenue increased 9% to $8.8 billion, operating cash flow increased 9% to $3.4 billion, and operating income increased 20% to $1.8 billion, all compared to the same time period in 2007. However, Comcast's total video, data and voice customer net additions in Q4 slowed to 290,000, compared to 714,000 net additions in Q3. The company said that in these more challenging times it will focus on free cash flow generation, increase its dividend and pursue four key initiatives for 2009: improve the customer experience, extend the DOCSIS 3.0 rollout to 65% of its markets, begin to deploy All-Digital to markets representing 50% of its customer base, and manage the digital transition.

Some highlights for Q4:

  • Earnings per share for the quarter ended December 31, 2008 was $0.14 compared to $0.20 in the same time period in 2007; Adjusted Earnings per share increased 35% to $0.27 in the fourth quarter.

  • Revenue from the Cable segment increased 8% to $32.4 billion for 2008 as compared to $30.1 billion in 2007, reflecting the adoption of digital and advanced video services, rate increases, continued growth in high-speed Internet (HSI) and Comcast Digital Voice (CDV) penetration and strong growth in Business Services, partially offset by video customer losses and lower advertising revenue.

  • The monthly average total revenue per video customer increased 9% from $101 to $110, reflecting an increasing number of customers taking multiple products. As of December 31, 2008, 23% of customers were three-product customers as compared to 16% at the end of 2007.

  • As of December 31, 2008, Comcast's video, high-speed Internet and voice customers totaled 45.6 million, reflecting 2.6 million net additions during 2008. This includes 14.9 million HSI customers, 6.5 million Digital Voice customers, and 24.1 million video customers.

  • During Q4, Comcast added or upgraded 433K customers to Advanced Digital services.

  • Programming expenses were up 7% in Q4 and up 8% for FY08

  • Marketing expenses were up 9% in Q4 and up 14% for FY08.

  • CAPEX declined 17% in 2008 to $5.7 billion compared to $6.3 billion in 2007. The company anticipates that 2009 capital investment will
    be less than 2008 both in dollars and as a percentage of revenue.

  • Digital penetration is current at 70%

  • 45% of Digital customers take Advanced Services, generating average monthly revenue of $80-$85

  • Comcast's On Demand library has 10,000 choices today and the company is working on "Project Infinity"

  • Revenue for Business Services Increased 41% for 2008 and is at a current run rate of $650 million per year.

See also