uploads///Business Service revs growth CMCSA_Q

Comcast’s Business Services’ Strong Growth Potential

By

Dec. 6 2017, Updated 7:30 a.m. ET

Small and medium businesses driving growth

Comcast’s (CMCSA) business services unit, a part of the company’s cable segment, delivered growth of 12.6% in 3Q17. The revenue growth was primarily due to an increase in small business customers and continued growth in its medium-sized business services due to improved Internet speeds and higher data usage.

The chart above shows the business service unit’s performance in the last five quarters. The unit, which comprised 12% of the company’s total cable revenue, has seen a compound annual growth rate of 3% for the last five quarters, the highest among business units. During the quarter, it added 31,000 business customer relationships, and revenue per business customer relationship rose ~5%.

Article continues below advertisement

Competition strategies

To boost its Internet speed and compete with carriers offering 4G (fourth-generation) speed, Comcast has started to roll out DOCSIS 3.1. The deployment may increase SMB (small and medium business) penetration.

To support its SMB clients, the company continues to enhance its service offerings. The company has launched SD-WAN (software-defined wide-area network) products and has 18 million Wi-Fi hotspots across the country.

Earlier, the company lacked wireless services. However, the launch of the XFINITY wireless service could boost its business service unit. In just five months, the company added more than 250,000 subscribers.

However, stiff competition from major telecom players AT&T (T) and Verizon (VZ) could drive up promotional costs for Comcast. Google (GOOGL) Fiber, which offers Internet speeds of ~1 gigabyte per second, is also a threat to Comcast’s growth.

Advertisement

More From Market Realist

    • CONNECT with Market Realist
    • Link to Facebook
    • Link to Twitter
    • Link to Instagram
    • Link to Email Subscribe
    Market Realist Logo
    Do Not Sell My Personal Information

    © Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.