Comcast stock drops as company fails to add internet users for the first time ever

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

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

In the second quarter of 2022 earnings announced today, Comcast said it had 2,9826,000 residential broadband customers, down 10,000 since the first quarter of 2022, and 2,337.000 business broadband customers, an increase of 10,000. The total number of business broadband customers remained The Internet of 32,163,000 people remains unchanged.

Comcast CEO Brian Roberts said the company’s cable division is experiencing “a unique and evolving macroeconomic environment that is putting temporary pressure on the volume of connections for our new customers.” Comcast also lost cable television and VoIP phone customers in the quarter but added cordless phone subscribers.

Comcast still managed to increase its quarterly broadband revenue compared to 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 it did a year ago despite a decline over the months. the last three.

Comcast’s share price is down more than 9 percent in today’s trading despite increases in the Nasdaq, Dow Jones and Standard & Poor’s 500; It has fallen by more than 32 percent in the past 12 months.

Zero broadband growth is a first for Comcast

The Wall Street Journal writes that this is the first quarter ever that Comcast has failed to gain broadband subscribers. “The company’s quarterly filings review shows that Comcast has added at least 100,000 new broadband subscribers every quarter over the past 20 years, with the exception of one case during the 2008-2009 financial crisis, when the company acquired 65,000 broadband subscribers in the second quarter of the year. 2009″. That covers the entire period since Comcast’s November 2002 merger with AT&T Broadband.

While competition from fiber and wireless services has been cited as the reason for the cable stagnation, it was inevitable that Comcast would reach a limit on customer growth eventually. After years of rapid increases in the number of customers, Comcast has probably subscribed to everyone who wants to serve it and lives in a home within the Comcast network.

In many parts of the United States, Comcast is the only viable option for a fast home Internet service. There are also people who want cable internet in areas that Comcast has deemed not profitable enough to build and cases where Comcast refuses to send a specific address unless the homeowner pays tens of thousands of dollars up front.

Comcast cut capital spending on the cable division in 2019, allocating less money to network extensions and improvements in the “line extensions” and “scalable infrastructure” categories. But this spending increased in 2020, 2021 and the first six months of 2022.

In the January-June period of this year, Comcast said that “capital expenditures for the cable division increased 2.5 percent to $3.1 billion, primarily reflecting increased investment in line extension, scalable infrastructure and supporting capital, which was offset by Partially lower investment in customer equipment.”

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