Comcast shares fall as company fails to add internet users for first time

Comcast CEO Brian Roberts speaking at an event.
Enlarge / Comcast CEO Brian Roberts at an event in Beijing on October 17, 2019.

Comcast is the largest Internet service provider in the United States with more than 29.8 million residential broadband customers, but the company’s long streak of Internet subscribers each quarter is finally over.

In Q2 2022 results announced todayComcast said it had 29,826,000 residential broadband customers, down 10,000 from Q1 2022, and 2,337,000 business broadband customers, a gain of 10,000. The overall tally of 32,163,000 residential and business Internet customers remained unchanged.

Comcast CEO Brian Roberts said the company’s cable division is experiencing “a unique and changing macroeconomic environment that is temporarily putting pressure on the volume of our new connected customers.” Comcast also lost cable TV and VoIP phone customers in the quarter, but added wireless phone subscribers.

Comcast was still able to increase quarterly broadband revenue from the second quarter of 2021 by 6.8%, to $6.1 billion, due to higher average prices and the fact that Comcast has more customers than a year ago despite the drop in the last three months.

Comcast’s share price fell more than 9% in today’s trading despite gains in the NASDAQ, Dow Jones and S&P 500; it has fallen more than 32% in the last 12 months.

Zero broadband growth, a first for Comcast

This is the first quarter in which Comcast has failed to gain broadband subscribers, according to the Wall Street Journal. wrote. “A review of the company’s quarterly filings shows that Comcast has added at least 100,000 net new broadband subscribers every quarter for the past 20 years, with the exception of a single instance during the 2008-09 financial crisis. , when the company gained 65,000 broadband subscribers in the second quarter of 2009,” the article said. It covers the whole period from Merger of Comcast in November 2002 with AT&T Broadband.

While competition from fiber and wireless services was cited as a reason for cable’s stagnation, it was inevitable that Comcast would eventually reach the limits of customer growth. After years of rapidly growing customer numbers, Comcast has likely signed up just about everyone who wants its service and lives in a home within Comcast’s network.

In many parts of the United States, Comcast is the only viable option for fast Internet service at home. There are also people who would like to get cable internet in areas where Comcast has deemed it not profitable enough to build and instances where Comcast refuses to wire a particular address unless the owner pays tens of thousands of dollars up front.

Comcast reduction in capital expenditures of its cable division in 2019, spending less money on network extensions and improvements in the “line extensions” and “scalable infrastructure” categories. But these expenses increased in 2020, 2021and the first six months of 2022.

From January to June of this year, Comcast said its cable division “capital expenditures increased 2.5% to $3.1 billion, primarily reflecting increased investment in line extensions, l ‘scalable infrastructure and support capital, partially offset by reduced investment in customer premises equipment’.

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