Along with its total customer base, which declined 1.8 percent in the last year, Cable One has also seen a steady decline in headcount, which is down by 154 employees, or 7.4 percent of its work force, over the last 12 months.
“As a result, we make meaningfully more money with fewer units and equally important, we are shaking our dependence on video,” said Cable One CEO Thomas Might, speaking to investors during the Phoenix, Arizona-based MSO’s second-quarter earnings report last week.
With net income up by 24.3 percent to $26.6 million in the second quarter, Cable One is now more confident than ever in a strategy of pursuing higher-margin, less-consumer-challenged customers.
While the decline in operating costs has exceeded the drop in revenue and produced this robust bottom line, it hasn’t necessarily come as great news for the MSO’s full-time installers and its installation contractors.
Cable One has lost 15.6 percent of its residential video customer base in the last year, as well as 13.9 percent of its residential voice subscribers, but saw total revenue increase by 1 percent in the second quarter to $202.6 million.
Residential data and business services revenue grew to 54.1 percent of total revenue for Cable One compared to 46.6 percent in the second quarter of 2015.
Notably, like total revenue, the MSO’s high-speed internet user base hasn’t grown explosively. It ended the second quarter with 465,603, up only 1.8 percent in one year. Business HSD users have grown at a more robust clip of 7.8 percent over the 12-month period.
One year in as a public company, and four years after embarking on a strategy to emphasize residential and business internet services, Might added that it “is gratifying to finally have some strong empirical evidence” that the lower subscriber, lower cost model works, “so we can move out of the experimental phase.”
Cable One says move away from video paying off as 11.5K TV subs flee but income rises 24.3%
Thomas Might on Cable One's transformation and how much time it has left in the video business
Cable One loses another 13K residential video subs, gets ready to tack on a $5 retrans fee