July 27, 2011

Virgin Media Q2 results: revenues up, customers down

From MediaGuardian:
Virgin Media lost 36,000 customers in the three months to the end of June, in part because thousands of students dropped their low-priced TV and broadband subscriptions for the summer holidays.

The Virgin Media chief executive, Neil Berkett, downplayed the significance of the customer losses – 21,200 of whom left Virgin Media's TV service – which were significantly worse than most analysts had forecast.

"We are very satisfied with the quarter," he said. "It proves our strategy of targeting the mass-market, digitally-aware, data-hungry consumers is working very well."

The company pointed out that more than 90% of the customers who left were "lower-value single- and dual-play [those taking two services from Virgin] customers" with 29% taking just a single service.

"We deliver superior growth, we do not chase unprofitable business," said Berkett. "It is not in our psyche."

Despite the customer losses the company reported an investor-pleasing 3.2% year-on-year increase in average revenue per user – a key metric watched closely by analysts – to £47.35 as Virgin Media boosted takeup of its higher-

The company said that it has installed 50,000 of its new TiVo personal video recorder set-top boxes, and has another 25,000 customers awaiting installation. Virgin Media believes its TiVo PVR is more technologically advanced than rival products such as BSkyB's Sky+ box.

5 comments:

sibod said...

Not that great then.

Perhaps they might be a little more amenable to Sky Atlantic then?

campbellg said...

Their worst quarter since end of June 2007.

Is it all students or is there a portion of disgruntled customers in there that are fed up with VM's lack of investment in content?

Erich said...

I wonder why they didn't have that many "students" drop their service in previous years.

howardmicks said...

They will lose more if they dont wake up and relise lack of new content is the problem

Richard said...

here is the shareholder presentation deck...

http://investors.virginmedia.com/imagelibrary/downloadmedia.ashx?MediaDetailsID=1113

and the transcript...
http://www.morningstar.com/earnings/28587472-virgin-media-inc-q2-2011.aspx?pindex=2