Cable operators keep up the pressure
Cable operators Comcast, Charter and Altice announced their quarterly earnings last week. As in the previous quarters, their mobile arms continued to show subscriber growth thanks to attractive service pricing and single-bill advantages. The largest of the bunch, Xfinity Mobile, ended Q2 2020 with nearly 2.4 million mobile subscribers, up by 126K connections from the previous quarter (and up from 1.6 million last year). Xfinity Mobile announced that its mobile service revenues increased 34% from last year. Spectrum Mobile trailed behind Xfinity Mobile with 1.7 million mobile subscribers, but the cable operator had an even better quarter in terms of net adds as it activated 325K new mobile lines during the same period. Relatively smaller Altice Mobile, on the other hand, ended the quarter with over 140K mobile customers, up 34K from the previous quarter.
The NPD Take:
- Xfinity Mobile and Spectrum Mobile’s unique service models that offer data buckets by the gigabyte is one of the major draws of the service as not every smartphone user needs unlimited cellular data. According to the NPD Connected Intelligence SmartMeter (an on-device metering application tracking usage), a little over half of U.S. smartphone users consume less than 6GB cellular data per month.
Apple enjoys record Q2 2020 revenue despite the pandemic
Apple last week announced that its fiscal Q3 2020 revenue ($59.7 billion) was the highest fiscal Q3 revenue ever recorded despite the pandemic that forced the OEM to shutter its retail locations worldwide. Apple saw its overall revenue increase 11% from the same period last year, while its services business grew 14%. iPhone sales only increased by a little under 2% year over year, while other product categories such as iPads (up 31%) and Wearables (up 17%) enjoyed a bigger boost from the same period of last year. The new budget-friendly iPhone SE 2020 was highlighted as the main reason behind the iPhone unit growth, and Apple CEO Tim Cook further noted that the $399 phone was stealing many customers from the Android platform.
The NPD Take:
- Apple’s stellar performance during a period when its primary retail channels were closed down due the pandemic is a clear indicator of the strength of its business. The aggressive price on the new SE came in handy during the economic downturn; while it poses a threat in pushing ASPs down, its potential in converting Android users to the Apple ecosystem offsets the ASP decline scenario.
- The steady growth in Apple’s revenues from its wearables, home and accessories business during the pandemic period is truly impressive considering the share of the retail transactions of these products in the past.