How AT&T, Verizon, Comcast, Spectrum Fared in Q4 Earnings

The top U.S. telco and cableco firms are reporting growth in wireless customers, but business wireline, voice and video tell another story.

Charter (Spectrum) on Friday reported that its number of SMB mobile lines increased from 55,000 in the fourth quarter of 2020 to 116,000  last quarter. Comcast earlier this week reported that it added a net 312,000 wireless customers last quarter. That’s the highest quarterly result for the cableco since the launch of its Xfinity Mobile wireless service. Comcast expanded the Verizon-powered MVNO offering to SMBs last summer.

“Our mobile is key for us. In and of itself [it] is a great growth opportunity, but it’s also very important to broadband. We talked a lot about broadband churn benefits. That continues, but we want to bring mobile value to every segment in every offer,” said David Watson, president and CEO of Comcast Cable, who said the company is converging its mobile offers to ensure “every single sales channel is optimized to deliver on these offer constructs.”

The cablecos have been putting heavy investments into their mobile offers, as indicated by Charter’s nearly 39% year-over-year increase in mobile expenses. At the same time, channel partners are still questioning how mobility fits into the product set they sell.

Comcast’s David Watson

These wireless gains come as video and legacy voice revenues stagnate across the industry. Verizon’s Fios business video connections declined almost 3% year-over-year. Comcast’s number of business voice customers declined from 852,000 in 2020 to 681,000 in 2021.

Business Unit Revenues

Charter drove in $1.67 billion in commercial revenue last quarter, an increase of nearly 5% from a year prior. The company similarly grew its year-end revenue almost 5%, to $6.8 billion.

Verizon business revenues dipped from $8 billion to $7.8 billion, but it managed to slightly grow its year-end revenue by .3%, to $31 billion. However, Verizon took a step back from its enterprise (2.5% decrease), wholesale (12.5% decrease) and public sector (12.1%) operating revenues a year prior. SMB saved the day with 4.3% year-over-year growth.

Comcast reported $2.3 billion for its fourth-quarter business services, an increase of 11.5% from the same quarter the year prior. Moreover, Comcast scored a year-end growth of more than 9%, to $8.9 billion. In addition, Comcast’s 2021 total business customers surpassed its 2020 business customers, going from to 2.4 million to 2.5 million.

Business Wireline Struggles

Business broadband demand seemed to be trending upward when we covered the earnings in the summer, but fourth-quarter results show a setback.

AT&T‘s business wireline revenues dropped 5.6% year-over-year, to $5 billion. The company cited declining voice and data services demand and “a strategic decision to de-emphasize non-core services.” On the other hand, consumer wireline revenue ticked up 1.4% to $3.2 billion, while its operating expenses ticked up 4.1%.

AT&T executives explained that they are rationalizing their “low-margin products” to keep business wireline margins stable. AT&T is counting on its fiber expansion, as well as deeper penetration of the SMB market, to provide a boost to its business wireline segment. Nevertheless, the company offered a less-than-optimistic projection for the upcoming year.

“We expect losses to moderate as we make our way through the year, but we don’t expect that segment to grow,” chief financial officer Pascal Desroches said. “…  You can get a pretty fair sense that overall, the business is going to be, on an EBITDA basis, flattish to up modestly.”

Other providers produced underwhelming results in wireline. Verizon’s wireline broadband connections decreased from 482,000 in the year-ago quarter to 477,000 in the fourth quarter of 2021. Comcast’s business broadband customer relationships increased from 2,300 to 2,318.

Our sister site, Light Reading, covered Charter’s fourth-quarter earnings and the wireless strategy of the cableco.