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Comcast lost $185 million trying to be Verizon last quarter

Comcast Xfinity Mobile vs Verizon

In the spring of 2017, Comcast surprised the industry by taking a committed dive into the world of mobile, debuting a new brand called Xfinity Mobile with a surprisingly excellent unlimited data plan using Verizon’s network. The service has been modestly popular, especially seeing as you need to be a Comcast internet subscriber to sign up, and things show no sign of letting up.

In its Q2 earnings report yesterday, Comcast revealed that it added 204,000 customers in the three months to June, its biggest quarterly addition since it started Xfinity Mobile. That takes its total number of lines to 781,000. That’s a respectably big customer base for a MVNO, especially considering that those are mostly expensive postpaid unlimited lines, the most coveted in then industry. Unfortunately for Comcast, there’s a problem: Money.

Despite the record customer additions, Comcast lost $185 million on wireless in Q2. That’s better than the $189 million it lost in Q1, when it added 196,000 new customers, but it’s still a huge amount of money to be burning on a venture that shows no sign of turning a profit any time soon. The economics of a virtual mobile provider, which buys capacity in bulk from a carrier (in this case Verizon) mean that the more customers they have, the lower they can drive the price they pay for capacity, but Comcast will need a lot more customers in order to start breaking even.

“We estimate Comcast’s cumulative Cash EBITDA losses from its wireless business have topped $1.2 billion since the launch in May of last year, while subscriber growth has stagnated at 200,000 per quarter, below the pace that would enable the company to top the 1 million subscribers additions that investors expected in 2018,” BTIG analyst Walter Piecyk said in a note seen by Fierce Wireless“Comcast’s subscriber growth once again fell well short of the 325,000 bogey we previously set as a level that would concern the wireless industry.”

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