Rogers posts increased revenues, profits in Q3

Growth in the company's wireless and cable businesses cancelled out losses on the media side.

money - from ShutterstockRogers Communications has reported increased year-over-year profits and revenues for Q3, as growth in its wireless and cable businesses cancelled out revenue decreases on the media side.

Overall, revenue increased 3% to $3.58 billion for Q3, up from $3.49 billion last year, while overall profits rose to $1.46 billion, from $1.385 billion.

The rising revenues were spurred by a 7% increase in the company’s wireless business, due to subscriber growth and increased uptake on higher-rate plans across its various wireless brands. Cable revenues were up 1% to $870 million for the quarter due to Internet revenue growth of 6% and the addition of 27,000 new subscribers. Media revenues meanwhile decreased 3% to $516 million, which Rogers attributed to the fact the 2016 Hockey World Cup bolstered media revenues in Q3 of last year.

In terms of profit, Rogers posted increases 6% to $1.463 billion, from $1.385 last year, which the company attributed to a 9% growth in its wireless business. On the cable side, profits were up 2% due to “the ongoing product mix shift to higher-margin internet and various cost efficiencies.” Meanwhile, media profits dropped 18% for the quarter due to higher Toronto Blue Jays player payroll and lower publishing-related revenue due to the strategic shift to digital media.

During a conference call following the release of the Q3 results, Rogers execs including president and CEO Joe Natale said Rogers is continuing to test its upcoming X1 IP-based video platform. The new product is an IPTV product designed to increase viewer engagement and provide a “personalized and immersive entertainment experience that enhances the way customers watch video and discover content.” A group of 1,000 Rogers employees will begin using and testing the service in their homes next month, before the company soft launches it to a larger group of employees in Q1 of 2018. On the current timeline, Natale said a full product launch will be available to consumers in the later part of 2018.

Last year, Rogers scrapped its plans to build an in-house IPTV system in favour of partnering with Comcast to license U.S. cable company’s X1 IP-based video platform. The change in direction saw the company take a pre-tax non-cash asset impairment charge of between $475 million and $525 million (CAD) in Q4 of 2016.