CEO: Altice USA broadband, mobile expansions gain steam
Despite an expensive optical fiber rollout continuing in Connecticut and the New York City region, Altice USA reported a significant improvement in losses for the first quarter of 2019 as it offset declining cable TV accounts with more revenue from broadband.
Through its Optimum TV and broadband services, Altice USA has a dominant footprint in lower Fairfield County and many other parts of the New York City area. The Long Island City, N.Y.-based carrier also offers Suddenlink cable service in several states in the south-central section of the country, and is gearing up to offer mobile telephone service this summer piggybacking on Sprint’s national network.
Altice USA continued to expand its overall customer base in the first three months of 2019, though seeing declines in the number of customers getting cable TV and the percentage of those with “triple play” accounts that combine TV, broadband and telephone service.
While analysts have been tracking the impact of “over the top” video competitors like Netflix, Amazon and Hulu on traditional cable TV providers like Altice, in a filing with the U.S. Securities & Exchange Commission Altice USA attributed Optimum’s decline in cable TV packages to competition from Verizon Communications and its FiOS fiber optic service which offers tiers of TV programming.
Altice USA lost $25.2 million in the first quarter of 2019, down exponentially from a $129 million shortfall a year ago. Revenue was up 3 percent driven by continued gains in broadband and business revenue, helping to overcome a slight decline in its mainstay cable TV revenue streams.
“We continue to believe that video is a core product (and) we’ll continue to offer it in multiple sizes and shapes,” said CEO Dexter Goei in a Thursday conference call with investment analysts. “It has a lot of benefits to our customer base in terms of retention and churn, but it continues to be a profitable business for us.”
On the mobile front, Goei said Altice USA had determined what it will charge for service after weighing the costs and opportunities of trying to beat competitors’ pricing, without providing further illumination on that front in advance of a launch this summer.
This past week, Altice USA announced the $200 million acquisition of Cheddar, a New York City-based business news service carried both online and on competing cable networks, which Altice USA sees as offering a new platform for advertising while adding new capabilities to its existing News 12 and i24News channels available to subscribers. On Thursday, Goei said that Cheddar is on a pace of nearly doubling revenue annually.