Despite facing the full financial fury of the COVID-19 pandemic, Rogers Communications still managed to eke out broadband and IPTV subscriber gains in the second quarter.
Rogers, which is Canada's biggest cable and wireless provider, reported Wednesday morning that it netted 5,000 broadband customers in the quarter ending June 30 in spite of a lack of promotional activity and a need to rely almost entirely on customer self-installs of cable equipment. As a result, the cableco closed out June with 2.56 million broadband subscribers, up 90,000 subs from a year ago.
The Canadian MSO, which passes a bit over 4.5 million homes across the country, fared even better with its new cloud-based Ignite TV offering. Rogers added 18,000 new subscribers for Ignite TV, boosting its total to 435,000, up 280,000 subs from a year earlier. The company is now transitioning its sizable legacy pay-TV customer base over to the Ignite TV platform.
Thanks to these results, Rogers' cable unit was just about the lone bright spot in its otherwise gloomy earnings release. The company reported that cable revenues amounted to C$966 million (US$720 million) in Q2, down just 3% from C$997 million ($743 million) a year earlier, as Canadians largely hunkered down around their home video screens during the spring.
The broadband and IPTV sub gains filtered in against the backdrop of overall plummeting revenue and net income figures for Rogers. Total revenues plunged 17% on a year-over-year basis to C$3.16 billion ($2.36 billion), largely driven by 13% and 17% decreases in wireless service and equipment revenue, respectively, and a whopping 50% drop in media revenue.
Even more notably, Rogers suffered a net income decline of 53% on a year-over-year basis to C$279 million ($208 million). That was due primarily to lower revenue and higher bad debt expenses across its three major cable, wireless and media units.
"We saw notable impacts across all of our businesses as sales and new business activity essentially ground to a halt," Rogers President and CEO Joe Natale said during the company's earnings call with analysts Wednesday morning. "As we expected, our second quarter results reflect the economic pressures we saw in our business as Canadians adapted to the challenges of COVID-19," he noted in a press release accompanying the Q2 earnings report.
But Natale insisted that Rogers' financial picture will begin returning to normal as the Canadian economy gradually recovers from the pandemic and reopens. "These metrics are COVID-19 specific and do not reflect our underlying fundamentals, nor do they diminish our long-term growth prospects," he said during the conference call.
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