High-speed-data service @Home
Network hit its subscriber and financial numbers in the third quarter, but apparently, a
failure to do better led investors to punish parent company At Home Corp.'s stock on a day
when its cable affiliates did far better.
The data-over-cable service said its quarterly revenue, at
$13.8 million, was 50 percent above its second-quarter results. In the same period a year
ago, At Home's revenue was just $1.9 million.
*Home's subscriber count was up to 210,000 as of Sept. 30,
a 43 percent gain over its June 30 total of 147,000. At Home's net loss of $9.7 million,
or 8 cents per share of stock, was trimmed from $11.1 million (9 cents) in the second
quarter, in line with analyst forecasts. The company's net loss in the third quarter of
1997 was $11.9 million, or 11 cents per share.
At Home's stock price fell by $2.25 (5 percent) last
Wednesday the day following the aftermarket earnings release closing at
$39.25. Most MSO stocks were up that day, as was the overall NASDAQ index.
Lou Kerner, who follows At Home at Goldman Sachs & Co.,
said, "The numbers were very strong," but apparently, there were "whisper
numbers" that weren't met. He added that "whisper numbers" are basically
hopes that some technology companies will beat analyst forecasts.
But that's hard for @Home to do when its subscriber numbers
depend on how hard its cable affiliates market the service.
Cable stocks were up last Wednesday, and one analyst said
@Home officials' comments about plant upgrades at key affiliates like Tele-Communications
Inc., Comcast Corp. and Cox Communications Inc. helped those stocks.
But Kerner said those comments were in line with what the
cable operators have been saying, and he credited Time Warner Inc.'s strong results with
helping the group.
Janco Partners Inc. analyst Ted Henderson said @Home's
numbers were in line with his forecasts for year-end benchmarks like subscribers (320,000)
and upgraded plant. @Home said its upgraded base rose to 10 million homes as of Sept. 30,
and Henderson figures that the @Home universe will rise to 13 million by year's end.
*Home's average penetration rate is 2.1 percent, and it has
penetrated beyond 5 percent in some key markets, it said.
Through nine months, At Home logged $28.8 million in
revenue, up from $3.7 million in the same period a year ago. Its net loss through nine
months was $32.5 million, or 29 cents per share, excluding $83.3 million in noncash
charges recorded in the first quarter of 1998.
Including the charge related to stock warrants
issued to affiliates the company's nine-month net loss was $115.8 million, or $1.02
The company's operating costs rose to $12.3 million from
$6.2 million in the second quarter.At Home ended the third quarter with $204
million in cash and short-term investments, including $126 million that the company raised
in a secondary stock offering in August.
At Home has spent $20.7 million on capital expenditures
over the first nine months, $6.6 million of which was spent in the third quarter.
service for business customers ended the quarter with 1,250 installed accounts, up 24