Frontier (FTR) reported customer revenues of $2.03 billion in the fourth quarter, almost flat from the year-ago quarter. Customer revenues were driven by marginally higher revenues in consumer and commercial revenues in Q4 2018 on a YoY basis. While the telecom company delivered consumer revenue of $1.09 billion, commercial revenue was $942 million in Q4 2018.
In the fourth quarter, customer revenue growth was flat as data and Internet services revenue growth was offset by the decline in voice and video revenues in the quarter. While voice services revenue declined ~2.8% YoY to $668 million, video services revenue fell 11.3% YoY to $275 million in the fourth quarter. Data and Internet services revenue grew 2.1% YoY to $959 million in Q4 2018.
Customer additions and losses
During the quarter, Frontier lost net customers of 92,000 in the consumer segment, higher than the 89,000 in the prior-year quarter and 86,000 in the third quarter. The company lost 67,000 broadband customers in Q4 2018, wider than the losses of 63,000 customers in Q4 2017 and 61,000 in Q3 2018. The company’s transformation initiatives are expected to improve the churn in the coming quarters.
Frontier has also lost 35,000 video customers in the fourth quarter, higher than the losses of 20,000 in Q4 2018 and 29,000 in Q3 2018, as traditional cable subscribers are shifting to cheaper online streaming alternatives provided by tech giants like Netflix (NFLX) and Amazon’s (AMZN) Prime Video. Notably, Netflix and Amazon are increasingly investing in original content to dominate the streaming services market and offer original shows and movies to consumers.
Charter (CHTR) and Comcast (CMCSA) also lost 36,000 and 19,000 residential video customers in the fourth quarter, respectively. AT&T (T), which is the second-biggest wireless carrier in the US after Verizon (VZ), reported a loss of 403,000 satellite TV customers in Q4 2018.