- Comcast reported 104K broadband subscriber losses in Q3 and named Steve Croney as the Connectivity & Platforms chief
- Croney is a driving force behind the operator's new pricing strategy, said Recon Analytics' Roger Entner
- Execs on the call also alluded corporate restructuring is underway
Comcast’s third quarter broadband results were surprisingly not too shabby, as the company exceeded analyst expectations with only 104,000 broadband customer losses.
The welcome news also came with an announcement that Steve Croney, current COO of Comcast’s Connectivity & Platforms, will succeed Dave Watson as CEO of the division effective January 1.
Watson has been in his existing role since 2017, back when the division was still called Comcast Cable. He’ll remain with Comcast as Vice Chairman, where he will advise the company and “lead strategic initiatives,” per the press release.
‘Tis the season of executive changes, as we’ve seen over at T-Mobile and Verizon. Comcast last month also revealed President Mike Cavanagh will become co-CEO in January alongside Brian Roberts.
Croney takes over the broadband ship
Cavanagh on the earnings call noted choosing Croney to head Connectivity & Platforms was a no-brainer, as he already made “a significant impact” on the division over the past year.
“He has the full trust and confidence of our entire management team, and he’s exactly the right person to take the business forward,” he said.
Recon Analytics Principal Roger Entner told Fierce Croney’s promotion was “a long-telegraphed change,” as he’s been a driving force behind moves such as the five-year price lock and updated broadband plans.
“He has received a tremendous amount of freedom to shape the organization and how they are going to market,” Entner said. “As he has been taking over Comcast has made unimaginable changes like giving customers the option to get away from exploding prices.”
But it’s not all good news at Connectivity & Platforms. Reports last month indicated Comcast plans to lay off an unknown number of employees in the unit, namely a layer between its corporate and regional offices. Cavanaugh on the call alluded restructuring is already underway.
He said Comcast in Q3 “streamlined our organizational structure to better align with our strategy…centralized key functions such as marketing, data science and customer experience and reduced management layers to sharpen local execution.”
As for customer reception to its new pricing, CFO Jason Armstrong said Comcast is seeing “a healthy mix of customers” opting for five-year plans. He also pointed out wireless is “a core growth engine,” as 14% of Comcast’s broadband base now has a mobile line.
Wireless net adds in Q3 were 414,000, and “nearly half of our residential postpaid phone connects came from customers taking a free line,” Armstrong added.
Competition and cost
Before anyone got too excited about an imminent comeback, Cavanagh tempered investor expectations by stating, “the broadband environment remains intensely competitive, which we do not expect to change anytime soon.”
Edward Jones analyst David Heger thinks while Comcast is improving its broadband metrics, it’ll take a lot more to counter competitive pressure.
“The price freeze and bundling strategy helped slow customer losses during the quarter,” he said in a research note. “However, Comcast continues to face tough competition from fixed-wireless services and needs to further slow internet-subscriber losses.”
Furthermore, Comcast’s pricing play is putting a damper on average revenue per user (ARPU) and adjusted EBITDA.
The Connectivity & Platforms biz saw adjusted EBITDA decline 3.7% in Q3 partly due to increased costs related to product, marketing and customer service. ARPU growth of 2.6% is expected to “step down by more than 1 point” in Q4, as Armstrong noted Comcast doesn’t plan to raise broadband rates in early 2026.
“This is a deliberate investment phase, one that will take time and carry a cost,” Cavanagh said.