Time Warner Cable Inc. Earnings Cheat Sheet: Rising Revenue Helps Margins Expand, Profit Rises

S&P 500 (NYSE:SPY) component Time Warner Cable Inc. (TWC) reported net income above Wall Street’s expectations for the most recent quarter. Time Warner Cable, Inc. together with its subsidiaries is a cable operator in the U.S., with systems located mainly in New York State, the Carolinas, Ohio, southern California and Texas.

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Time Warner Cable Earnings Cheat Sheet for the Second Quarter

Results: Net income for Time Warner Cable Inc. rose to $420 million ($1.24 per share) vs. $342 million (95 cents per share) in the same quarter a year earlier. This marks a rise of 22.8% from the year earlier quarter.

Revenue: Rose 4.4% to $4.94 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: TWC beat the mean analyst estimate of $1.15 per share. Analysts were expecting revenue of $4.93 billion.

Quoting Management: Time Warner Cable Chief Executive Officer Glenn Britt said: “Time Warner Cable continued to perform well in the second quarter, driven by very strong results in business services and higher residential ARPU. We also continued to generate strong free cash flow while still investing in our core business, allowing us to return more than $1 billion to our shareholders.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the first quarter, net income rose 51.9% and in the fourth quarter of the last fiscal year, the figure rose 21.7%.

Revenue has risen the past four quarters. Revenue increased 5% to $4.83 billion in the first quarter. The figure rose 5.9% in the fourth quarter of the last fiscal year from the year earlier and climbed 5.2% in the third quarter of the last fiscal year from the year-ago quarter.

The company has now beaten estimates the last two quarters. In the first quarter, it topped expectations with net income of $1.01 versus a mean estimate of net income of 99 cents per share.

Gross margins grew 0.5 percentage point to 53.5%. The growth seemed to be driven by increased revenue, as the figure rose 4.4% from the year earlier quarter while costs rose 3.3%.

Competitors to Watch: Comcast Corporation (NASDAQ:CMCSA), Cablevision Systems Corp. (NYSE:CVC), Mediacom Communications Corp. (NASDAQ:MCCC), Time Warner Inc. (NYSE:TWX), AT&T Inc. (NYSE:T), DISH Network Corp. (NASDAQ:DISH), Charter Communications, Inc. (NASDAQ:CHTR), Verizon Communications Inc. (NYSE:VZ), DIRECTV (NASDAQ:DTV), and China Cablecom Hldgs. Ltd. (NASDAQ:CABL).

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(Source: Xignite Financials)