Summary:

Comcast (NSDQ: CMCSA) was unable to escape cable industry trends of basic video subscriber losses, though it did have some success in adding…

Comcast
photo: Corbis / Richard Cummins

Comcast (NSDQ: CMCSA) was unable to escape cable industry trends of basic video subscriber losses, though it did have some success in adding internet and phone customers. With its NBC Universal unit continuing to build higher ad dollars, that appeared to be enough to boost Q2 profits and revenues for the number one MSO.

– Comcast lost 238,000 basic video subs as it added 144,000 high-speed internet users and 193,000 phone customers. Despite the drop in video subs, revenues in that segment grew by 10 percent. That was mainly due to the 8.9 percent gain in average revenue per video subscriber to $137.51, which was attributed to a mix of higher rates and individuals and businesses taking on additional products. Over the past six months, cable revenue increased 5.7 percent to $18.4 billion.

The number of combined video, high-speed internet and voice customers increased by 99,000, an 18.2 percent increase.

– NBCU unit rose 17 percent to $5.18 billion in Q2, while for the six month period ending June 30, the network’s revenue was up a slight 2 percent to $9.5 billion.

Results looked pretty good on both the cable programming and the broadcast sides, indicating the TV advertising remained healthy even with the economy appearing to weaken. Specifically, revenue from the cable networks segment increased 12.6 percent to $2.2 billion, while the broadcast segment rose 18.5 percent to $1.7 billion. As rival CBS (NYSE: CBS) reported in its earnings yesterday, NBCU benefited from higher content licensing revenue from its Netflix (NSDQ: NFLX) streaming deal, which goes back to 2007. Last month, NBCU and Netflix signed a new agreement, which will give the video renter access to the network’s past seasons’ programming only.

But NBCU also missed some projections, including a metric watched carefully by cable analysts — free cash flow.

– As for the video sub numbers, here’s Bernstein Research’s Craig Moffett with a quick take:

While Comcast’s subscriber metrics, particularly the all-important video subscriber number, were just a little light of expectations, they were nevertheless better than a year ago, and significantly stronger than TWC’s (the video subscriber number is dubbed “all-important” because… well, because everyone seems to have decided it is all-important).

But, as Moffett also noted, Comcast didn’t stem the losses as much as expected. The plus — using the term lightly — is the basic video losses from Comcast and Time Warner Cable (NYSE: TWC) appear to be driven more by economic conditions than people dumping cable for online video:

The poverty problem is now front and center for all subscription businesses, especially in video, which we believe will remain under pressure as low end consumers struggle to make ends meet.

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