Altice profits up 2.7% in Q2 on Suddenlink and Cablevision performances

Cablevision
(Credit: El Gran Dee, Flickr)

Altice NV’s aggressive acquisition of U.S. cable companies is already paying off, with the second-quarter performances of Suddenlink Communications and Cablevision offsetting a slowdown for the company’s SFR telecom operations in France.

All told, Netherlands-based Altice NV beat analyst expectations in the second quarter by growing revenue 2.7 percent, with the Altice USA unit bringing in 41 percent of the total company’s free cash flow. 

In its second quarter under the Altice USA umbrella, Suddenlink generated revenue growth of 3 percent, with pay-TV customer losses slowing to 23,000 vs. 29,000 in the second quarter of 2015. The MSO lost 2,000 broadband customers vs. losses of 3,000 in the year-ago period.

Over at Cablevision (which is now known as “Optimum” on the Altice balance sheet), video subscribers were down 2,000 while broadband users rose 26,000. The Bethpage, N.Y. MSO’s second-quarter revenue growth of 2 percent didn’t have much impact on Altice’s bottom line, since the company closed its $17.7 billion purchase of the MSO in May. 

Altice USA Chairman and CEO Dexter Goei said Altice will continue to walk a fine line, reducing costs by dropping what he called “non-core” projects like Cablevision’s Wi-Fi calling platform Freewheel, while investing in core products to improve margins and customer churn. 

“The expected budget for Optimum was down as many projects were terminated,” Goei said during today’s earnings call. “We continue to push forward with a strong upgrade of the asset going forward.”

He said Altice USA will save up to $100 million by not having the Dolan family on the Optimum balance sheet for the remainder of the fiscal year.

Goei also praised a controversial decision by Suddenlink’s previous management team not to renew a program licensing contract with Viacom. 

“The impact on subscribers was minimal,” he said. “The customer experience was replaced very quickly by alternative channels that were added.”

For more:
- read this Altice earnings release

Related articles:
Altice reportedly lays off 100 at Cablevision's Bethpage headquarters, but hiring in other areas
Altice no longer signing up new Freewheel customers
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