"The cable distribution giants like Time Warner Cable and Comcast are already making a 97 percent margin on their “almost comically profitable” Internet services, according to Craig Moffet, an analyst at the Wall Street firm Bernstein Research."
Comcast's 2008-2011 mean (standard deviation) operating margin is 20% (0.8 percentage points), pre-tax margin is 14% (1.8 percentage points), and net income margin 9% (1.4 percentage points). This is of note for a purported utility, but not "comically profitable".
Let's observe their most recent quarterly disclosure [1] by business segment. Here we learn that the Cable Communications division, which "consists primarily of video, high-speed Internet and voice services (“cable services”) for residential and business customers in the United States", had an operating margin of 40% and spent 14% of revenues on capital expenditures. We also learn that Cable Networks, which "consists primarily of our national cable television networks, our regional sports and news networks, our international cable networks, our cable television production studio, and our related digital media properties", had an operating margin of 37%.
Where's the money going? Breaking out Cable Communication's costs, 35% went to programming, 35% go to "Other", defined as "business services, advertising, network operations, and franchise and other regulatory fees", 12% to marketing, 10% to technical labour, and 8% to customer service. Also of note, 24% of the division's revenues came from residential high-speed internet (50% came from residential video).
Comcast's 2008-2011 mean (standard deviation) operating margin is 20% (0.8 percentage points), pre-tax margin is 14% (1.8 percentage points), and net income margin 9% (1.4 percentage points). This is of note for a purported utility, but not "comically profitable".
Let's observe their most recent quarterly disclosure [1] by business segment. Here we learn that the Cable Communications division, which "consists primarily of video, high-speed Internet and voice services (“cable services”) for residential and business customers in the United States", had an operating margin of 40% and spent 14% of revenues on capital expenditures. We also learn that Cable Networks, which "consists primarily of our national cable television networks, our regional sports and news networks, our international cable networks, our cable television production studio, and our related digital media properties", had an operating margin of 37%.
Where's the money going? Breaking out Cable Communication's costs, 35% went to programming, 35% go to "Other", defined as "business services, advertising, network operations, and franchise and other regulatory fees", 12% to marketing, 10% to technical labour, and 8% to customer service. Also of note, 24% of the division's revenues came from residential high-speed internet (50% came from residential video).
[1] http://www.sec.gov/Archives/edgar/data/1166691/0001193125124...