Cablevision may be facing a difficult economy and a tough competitive challenge from Verizon FiOS in its home New York City market, but neither of these factors seemed to make much of a dent in its third-quarter 2009 profit. In fact, Cablevision reported that third-quarter profit actually tripled. And Wall Street rewarded Cablevision's performance by driving its shares up 3.2 percent yesterday to close at $24.02.
During the third quarter, Cablevision reported $98.9 million, or 33 cents a share, an improvement from the $30.9 million it earned in Q3 08. Although the third quarter is usually when the company sees revenue dip, Cablevision reported that revenue rose 5 percent from $1.75 to $1.84 billion. The MSO said an increase in cable TV rates helped to boost its Q3 09 revenues.
Cablevision's telecom division (cable TV, phone and Internet data services) performed well in the third quarter with a 4.9 percent revenue increase. Each of its service segments contributed to decent growth during the third quarter. The MSO saw new digital cable TV subscriptions rise 2.6 percent, while analog subscribers declined 1.5 percent. Meanwhile, Cablevision's Internet subscriber base grew 4 percent, while its phone service increased 10 percent bringing it to 2 million total telephony subscribers.
Of course, the question on everyone's mind is how it feels about the competitive threat Verizon is bringing to its market? Right now, Cablevision does not seem to be overly worried about Verizon FiOS. Despite an aggressive build out in New York and other areas of its territory, FiOS is currently available in only 36 percent of the MSO's market.
"It is expanding less rapidly than it has in prior years... and therefore their overall competitive impact is somewhat less," Tom Rutledge, Cablevision's chief operating officer, said during a conference call with analysts.
- Yahoo News via AP has this article