Insight Reports Solid 3Q10/29/2004 5:49 AM Eastern
Insight Communications Co. Inc. reported strong third-quarter results Friday, fueled mainly by its biggest quarterly increase ever in high-speed-Internet customers.
Revenue rose 10% in the period to $250 million and operating cash flow rose 7% to $105 million.
Operating-cash-flow results were impacted by increased marketing spending and the termination of a management agreement with Comcast Corp. in July, concerning about 80,000 subscribers in Kentucky.
In a research note, Citigroup Smith Barney cable and satellite analyst Niraj Gupta said the termination of the Kentucky management contract represented a loss of about $2 million in operating cash flow in the period.
But the marketing expenditure appeared to be well-spent -- it translated into 37,600 additional high-speed-data customers in the quarter, Insight’s largest increase ever. And Insight said its overall revenue growth was due in large part to the high-speed increases -- revenue in that segment was up 40% over last year.
Digital-cable growth was below some analysts’ expectations at 21,200. Basic-video customers increased by about 1,200, compared with a loss of 2,300 customers in the same period of 2003. Insight also added about 1,200 telephone customers, finishing the quarter with 62,800.
“[Insight] seems to be weathering satellite local-into-local competition reasonably well,” Gupta wrote.
Insight stock was down 22 cents per share to $8.87 each in Friday-afternoon trading.