Comcast Corp. reported better-than-expected financial results in the most recent quarter and limited the loss of cable customers, despite the pressure on the pay-TV business from cord-cutting and cheaper streaming options.

Net income in the second quarter fell to $2.03 billion, or 83 cents a share, compared with $2.14 billion, or 84 cents a share, a year ago, dragged down by a weaker performance at the film studio without a major blockbuster release in the period.

Revenue grew 2.8% to $19.27 billion. Both figures exceeded estimates from analysts, who were projecting earnings of 81 cents a share on about $19 billion in revenue, according to Thomson Reuters.

Comcast lost 4,000 video customers in the seasonally weak second quarter when many families move or customers cancel cable-TV service during the summer months. It was an improvement from the 69,000 subscribers lost in the year-ago period and its best second-quarter performance in a decade.

Cable companies are benefiting from investing more in their cable-TV products and bundling them alongside fast broadband, as well as offering cheaper, slimmed-down bundles of programming for more cost-conscious consumers.

Comcast, in particular, is beginning to benefit from the rollout of its next-generation X1 internet-connected set-top box and guide, which the company has said increases the time customers spend watching TV and makes them more likely to stick with Comcast. As of the second quarter, 40% of customers now have X1 boxes. Earlier this month, Comcast said it plans to integrate Netflix's service into its X1 box after years of holding out from striking such a deal.

Comcast also likely benefited from weakness at its rivals, as AT&T focused on integrating DirecTV and Dish Network Corp. faced blackouts amid carriage disputes, Wells Fargo analyst Marci Ryvicker said in a research note earlier this month.

The company's broadband and business services divisions reported sales growth in the second quarter, boosting overall revenue at the cable business. The cable unit, which accounts for the bulk of the company's revenue, posted 6% sales growth to $12.44 billion.

Broadband revenue increased 8.6% to $3.37 billion, as the company added 220,000 broadband customers in the quarter compared with 180,000 a year earlier.

Video revenue grew 2.8% to $5.58 billion, while business-services revenue jumped 17% to $1.36 billion. Voice revenue fell 1.1% to $893 million.

At NBCUniversal, revenue fell 1.8% to $7.10 billion, as declines in filmed entertainment offset growth at its television networks and theme parks. Operating cash flow at NBCUniversal was relatively flat at $1.69 billion.

Filmed entertainment posted a 40% drop in revenue and 87% decline in operating cash flow as Universal Pictures lacked a major blockbuster release in the second quarter. A year ago, the studio had box-office hits including "Furious 7" and "Jurassic World."

In April, Comcast agreed to buy DreamWorks Animations SKG Inc. for $3.8 billion in a deal that will add the "Shrek," "Kung Fu Panda," and "Madagascar" franchises to its film lineup and help it challenge Walt Disney Co. in family entertainment. The deal is expected to close by the end of the year.

Revenue grew 4.7% to $2.57 billion at the unit that includes Comcast's cable TV networks including Bravo, USA Network and Syfy, and operating cash flow grew 8.3% to $944 million. Revenue at the broadcast-TV segment, which includes the flagship NBC network, increased 17% to $2.13 billion.

Revenue at NBCU's theme parks segment grew 47% to $1.14 billion, thanks to the inclusion of Universal Studios Japan, which Comcast bought control of last September, as well as Universal Studios Hollywood's opening of the Wizarding World of Harry Potter.

Write to Cassandra Jaramillo at cassandra.jaramillo@wsj.com and Shalini Ramachandran at shalini.ramachandran@wsj.com

 

(END) Dow Jones Newswires

July 27, 2016 07:25 ET (11:25 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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