Time Warner Cable Reports 2012 Second-Quarter Results

Thursday, August 2nd, 2012
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NEW YORK — Time Warner Cable Inc. (NYSE: TWC) today reported financial results for its second quarter ended June 30, 2012.

Residential video revenues decreased driven by declines in video subscribers and revenues from premium channels and transactional video-on-demand, partially offset by price increases, a greater percentage of subscribers purchasing higher-priced tiers of service and increased revenues from equipment rental charges.

Subscriber Metrics

Residential (in thousands):

                                                  2011            2012
                        ------------------------------  --------------
                            1Q      2Q      3Q      4Q      1Q      2Q
                        ------  ------  ------  ------  ------  ------
Video
 Subscribers(1)(2)(3)   12,191  12,067  11,939  11,889  12,468  12,299
 Net additions(1)(2)      (66)   (130)   (128)   (129)    (94)   (169)
Digital Video Recorder
 Subscribers(1)(2)(4)    4,672   4,625   4,590   4,654   5,039   5,075
 Net additions(1)(2)        42    (47)    (35)      53      92      36
 Penetration(5)          51.7%   51.2%   51.1%   51.8%   52.2%   52.8%

[Digital Video
 Subscribers*            9,037   9,033   8,982   8,985   9,653   9,612

* Digital Video Recorder subscribers divided by DVR penetration(5).]

1. During the first quarter of 2012, the Company recorded adjustments that decreased digital video recorder subscribers by 75,000. This adjustment is not reflected in net additions (declines) for the respective quarterly period.

2. The Company has recorded subscriber changes resulting from acquisitions during the periods presented, as follows:

  • During the second quarter of 2011, the Company acquired a small cable system, resulting in an increase of 6,000 residential video subscribers.
  • During the fourth quarter of 2011, the Company acquired cable systems from NewWave Communications, as well as another small cable system, resulting in an increase of 79,000 residential video subscribers and 11,000 digital video recorder subscribers.
  • On February 29, 2012, the Company acquired Insight Communications Company, Inc., resulting in an increase of 673,000 residential video subscribers and 368,000 digital video recorder subscribers. TWC uses a methodology for counting certain subscribers that differs from the methodology used by Insight. TWC has estimated the Insight subscribers under TWC counting methodologies; however, these estimates are subject to adjustments as TWC completes its integration of Insight.

The acquired subscribers are reflected in the Company’s subscriber numbers in the period in which they were acquired and in subsequent periods; however, they are not reflected in net additions (declines) for the respective quarterly and annual periods.

3. Video subscriber numbers reflect billable subscribers who purchase at least the basic service video programming tier. The determination of whether a video subscriber is categorized as residential or business is based on the type of subscriber purchasing the service.

4. Digital video recorder subscriber numbers reflect subscribers who purchase digital video recorder service. Digital video recorder subscribers are not included as separate primary service units.

5. Digital video recorder penetration represents digital video recorder subscribers as a percentage of digital video subscribers.