Ouch! On Thursday, September 7, Comcast Corporation (NASDAQ:$CMCSA) shares plunged, falling as much as 7.2%. The Philadelphia-based company saw its stock finish the trading day down 6.2%.
So What Happened?
Many speculate the sharp decline was caused by the comments of Matthew Strauss, Comcast’s VP of Xfinity services. During a Merrill Lynch investor conference on Thursday, Strauss announced that Comcast expects to lose roughly 100,000 to 150,000 video subscribers during its third quarter.
Are you wondering why that’s important? You should be; a loss of 100,000 to 150,000 video subscribers would represent a steep decline in comparison to the second quarter, when Comcast’s total video customer net losses were 34,000.
According to Strauss, the forecast loss in subscribers is due to Hurricane Harvey and an increase in competition. Strauss told CNBC that this was Comcast’s “most competitive quarter” in recent history. Though Comcast Corporation might have an idea of what is causing their problems, Strauss still did not say what portion of these losses Comcast expects to be driven by each cause.
What Does The Future Hold?
For perspective, it’s worth mentioning that Comcast Corporation had roughly 22.5 million video subscribers at the end of its second quarter. So, even though a quarterly loss of subscribers between the range of 100,000 to 150,000 would be a cause for concern, investors should still keep a close eye on the company to see whether or not management believes they can maintain a firm grip on these challenges and reverse the decline.
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