AT&T Broadband lost 179,000 subscribers in the first quarter, a 1.5
percent drop, and company executives said the decline is expected to continue
into the second quarter.
In a conference call with analysts discussing first-quarter results, AT&T
Broadband CEO William Schleyer said the subscriber loss was 'unsettling,' but he
added that 80 percent of the decline was due to the expiration of aggressive
promotional discounts and a large backlog of customer disconnects.
Schleyer said second-quarter subscriber numbers should drop by about 64,000
customers, mirroring a decline in the same period of 2001.
AT&T Broadband reported first-quarter pro forma revenue -- adjusted for
significant closed cable dispositions and acquisitions -- of $2.44 billion, up
Cash flow was $465 million, an 18 percent increase over the $394 million
reported in the first quarter of last year but down 14.5 percent from the
fourth-quarter figure of $544 million.
Cash-flow margins -- or cash flow as a percentage of revenue -- at 19 percent
for the first quarter increased by three percentage points compared with the
first quarter of 2001, but they were down from the 22.9 percent reported in the
fourth quarter of last year.
Digital-subscriber growth also slowed to 250,000 additions in the quarter
compared with 335,000 in the fourth quarter. Telephony and high-speed-data
additions were up slightly versus the fourth quarter to 110,000 and 140,000,
Schleyer said AT&T Broadband continues to focus on upgrades and rolling
out new services. He added that a plan to repackage its digital-cable offering
will begin in the summer. He did not elaborate.