Both Comcast and Charter are expected to add thousands of new mobile customers throughout the remainder of this year and more in the years to come. But Wall Street analysts are generally viewing the cable companies’ mobile efforts as careful rather than aggressive.
In the second quarter, Comcast reported a gain of 204,000 Xfinity Mobile lines, bringing the company’s total mobile customer base to 781,000 lines. Separately, Charter launched its Spectrum Mobile MVNO at the end of the second quarter, and though it didn’t discuss initial customer figures, the company did say that it spent $116 million during the quarter on mobile, including $33 million in operating expenses and $53 million in capital expenses.
Those figures allowed a number of Wall Street analyst firms to create some expectations for the companies’ performance in the coming quarters. Specifically, Wall Street analyst firm Macquarie Research said it expects Charter to gain a total of 650,000 during the next 13 months, which the firm noted will be slightly behind the 780,000 that Comcast managed to acquire during the same period.
Meanwhile, the analysts at Oppenheimer predicted that Comcast will increase its Xfinity Mobile customer base to around 1.3 million by the end of this year, growing that to 2.3 million by the end of next year and 3.3 million by 2020.
In general, Wall Street analysts offered a positive outlook on Comcast’s continued efforts in mobile. For example, the analyst at Cowen noted that Comcast gained more mobile customers in the second quarter than they had expected, “encouraging considering a slow volume wireless quarter and inline costs (relative to our expectations).”
Though not all analysts were so positive in their outlook: "We estimate Comcast’s cumulative Cash EBITDA losses from its wireless business have topped $1.2 billion since the launch in May of last year, while subscriber growth has stagnated at 200,000 per quarter, below the pace that would enable the company to top the 1 million subscribers additions that investors expected in 2018," wrote BTIG analyst Walter Piecyk in a post.
Nonetheless, it’s clear that many of the nation’s largest cable operators are bound and determined to make a serious run on the mobile sector. Altice, for example, has said it will launch its own mobile service through a Sprint MVNO next year, and an Altice executive hinted that the company might be able to make a more profitable run at the wireless business than Charter and Comcast have been able to do.
“We want to make this a profitable standalone business,” Altice’s Dexter Goei said during the company’s quarterly conference call with analysts. “So, we don't anticipate, even in our first year of operation, to lose money on this. There may be working capital timing differences relative to handsets and how we treat those, but in terms of losing money, we are not going to lose money.”
For their part, both Charter and Comcast operate their respective MVNOs through Verizon’s network.