NEW YORK (AP) _ Time Warner Cable Inc. on Thursday reported a drop in second-quarter profit as higher costs offset a boost in subscriber growth.
The cable company reported a 7.2 percent drop in profit to $463 million, or $1.62 per share. Earnings, adjusted for non-recurring gains, came to $1.54 per share.
The results missed Wall Street expectations. The average estimate of 17 analysts surveyed by Zacks Investment Research was for earnings of $1.82 per share.
Revenue rose 3.5 percent to $5.93 billion in the period, also falling short of Street forecasts. Fourteen analysts surveyed by Zacks expected $5.94 billion.
The company added 66,000 residential customers during the quarter. The subscriber growth and revenue boost, though, was offset by overall higher costs. Programming costs rose 8.7 per percent to $1.4 billion, while sales and marketing costs rose 10.2 percent to $389 million.
Charter Communications has agreed to buy Time Warner Cable for $67.1 billion, and the companies are currently seeking government approval of the deal. Comcast Corp. attempted a buyout of Time Warner Cable, but scrapped its proposal after regulators raised antitrust concerns.
Time Warner Cable shares have climbed 25 percent since the beginning of the year, while the Standard & Poor’s 500 index has risen slightly more than 2 percent. The stock has increased 26 percent in the last 12 months.