Comcast Lost 120,000 Broadband Subs in Second Quarter

WASHINGTON, July 23, 2024 – Comcast lost 120,000 broadband subscribers in this year’s second quarter, fewer than analysts expected but greater than the 19,000 lost this time last year. Executives attributed the loss to competition and negative seasonality, adding the company expected to see the bulk of its losses from the shuttered Affordable Connectivity Program next quarter.

The ACP gave 23 million low-income households a $30 discount on their home or mobile broadband service but it ran out of funding on May 31, despite some frenzied efforts on Capitol Hill to provide new money.

A majority of ACP participants told the Federal Communications Commission that they had no or inconsistent broadband access before enrolling, and companies have been preparing for lost subscribers as former participants’ bills increased.

Verizon, for example, yesterday said in the second quarter it lost 410,000 prepaid phone subscribers who were enrolled in ACP.

Comcast Cable CEO David Watson noted on a call Tuesday with Wall Street analysts that the majority of the company’s ACP customers were on postpaid rather than prepaid service plans that typically cater to low-income subscribers. He said Comcast is looking to keep ACP subscribers on board with affordable services like its newly launched NOW prepaid offering.

Of the potential impact, Watson said, “But again, it’s too early to quantify and we just won’t know until further through the cycle.”

The company reported 322,000 additional wireless subscribers, bringing its mobile subscriber base to nearly 7.2 million. 

Comcast is one of the biggest Internet Service Providers in the country, with 32 million broadband subscribers. Watson said he was optimistic about getting more of those customers on the company’s wireless service, which it offers through a network partnership with Verizon.

“Wireless is such an important part of our overall strategy, and it’s key that it’s at 12 percent penetration,” he said. “We’ve got great runway ahead.”

Watson said the company is planning to get incremental mid-split upgrades to 50 percent of its footprint by the end of the year. Getting mid-split in place lays the foundation for more widespread DOCSIS 4.0 upgrades, which makes cable broadband speeds more comparable to fiber.

Comcast saw fiber ISPs as their main competitors on the broadband front, Watson said, although he acknowledged fixed wireless was continuing to be a source of stiff competition, especially for small businesses and lower income residential customers.

“Fiber is, quite frankly, the longer term competitor,” he said. “We’re competing fiercely against fixed wireless, and every competitor, but you know, we anticipate where [fiber providers] are building, what they’re doing, keeping track of all of that.”

The company added 302,000 homes and businesses to its footprint in the quarter, bringing total passings to about 63 million.

The company reported $29.7 billion in revenue and a net income of $1.3 billion, below what analysts were expecting. That’s in part because of poor performance from its parks business. Broadband revenue grew 3 percent year over year to $6.6 billion, driven by higher rates.