Cable One reported largely flat total customer growth of 0.9% for the 2017 fiscal year to its legacy business, but attributed the stagnation to a change in marketing strategy.
“It’s actually a lack of broadband promotions,” said Julie Laulis, CEO of the Phoenix, Arizona operator, during the company’s full-year and fourth-quarter earnings presentation today.
Laulis said Cable One has cut down on the amount of sign-up promotions it conducts in an effort to create “more sustainable growth over the long term."
“We’ve stopped year-long discounting of our flagship 100 Mbps product, for example,” she said. Also, Cable One has begun to regionally customize marketing campaigns, moving away from what Laulis said were, “one size fits all marketing philosophies.”
She said this will result in markedly lower customer churn in the long term.
Income and revenue: For the fourth quarter, Cable One saw a 484.3% spike in net income to $143.2 million, driven by the integration of 2017 acquisition New Wave Communications, as well as the benefit of the Republican-led corporate tax bonanza. With New Wave factored out, legacy Cable One saw a 465.1% net income growth to $138.5 million.
Total revenue was $257.7 million in the fourth quarter, with New Wave accounting for $47.6 million. This compares to the $206.7 million in revenue produced by legacy Cable One in the fourth quarter of 2016.
Residential data revenue increased 27.2% year over year, and business services revenue spiked 37.2%. Once again, factoring out New Wave, these growth figures are 8.6% and 9.9%, respectively.
According to Cable One CFO Kevin Coyle, the operator now gets about 60% of its revenue from residential broadband and business services.
Subscribers: Legacy Cable One ended 2017 with just over 270,000 video customers, down 11.9% year over year. The addition of New Wave adds 76,709 pay TV users to the company’s bottom line.
Residential broadband users, meanwhile, continue to grow narrowly for the MSO, up 1.5% for the year to just over 476,000 for the legacy business, representing 1.5% growth. With New Wave factored in, however, Cable One’s residential HSI business has 584,854 subscribers, representing 24.7% growth.