Time Warner Cable Inc., the second-largest U.S. cable television operator, reported fourth-quarter profit Thursday that topped estimates as the company added more Internet customers.
Excluding one-time costs, earnings per share were $1.57, beating the $1.55 average analyst estimate compiled by Bloomberg News. Sales rose 9.9 percent from a year earlier to $5.5 billion, in line with the $5.51 billion average analyst estimate.
Time Warner Cable added 75,000 residential high-speed data subscribers and gained 14,000 business customers for the services, it said.
Average sales per customer increased as the New York-based cable provider announced a $3.95-a-month fee for renting its wireless modems in the quarter, allowing the company to generate more revenue from the service.
Time Warner Cable’s Akron-based unit, which serves Northeast Ohio and Western Pennsylvania, is the overall company’s third-largest division.
Fourth-quarter net income fell to $513 million, or $1.68 cents a share, from $564 million, or $1.75 a share, a year earlier, the company said.
The cable operator lost video customers as the basic cable subscriber base has declined since 2009 as customers switch to video services from phone and satellite companies.
Time Warner Cable repurchased 6 million shares in the fourth quarter for $571 million, up from the previous quarter’s $500 million.
Investors want clarity on how future stock buybacks will be affected by the company’s just-completed $7 billion dollar deal to develop a new regional sports network for Major League Baseball’s Los Angeles Dodgers, said Craig Moffett, an analyst with Sanford C. Bernstein.
“They’ve got some explaining to do with the Dodgers,” Moffett said. “There’s a certain irony in a $7 billion deal that’s supposed to be a solution for runaway programming costs.”
Time Warner Cable’s potential capital return might also be affected if it acquires Cablevision Systems Corp.’s Optimum West division.