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Cincinnati Bell (CBB) Lags Q1 Earnings and Revenue Estimates

Cincinnati Bell Inc. CBB is a leading regional diversified telecommunications and technology service provider to both residential and business customers. The company operates its business through two segments: Entertainment and Communications and IT Services & Hardware.

Introduction of MyTV through its Fioptics high-speed Internet service bodes well as providing smaller, tailored TV channel packages are likely to drive the company’s top line as well as check churn. Moreover, creation of a new business division aimed at providing support services to various small and mid-sized Businesses (SMBs) is an added positive.

On the flip side, continuous erosion in local access lines, heavy capital expenditure requirements, slower pace of ARPU growth along with legal hurdles remain potent headwinds. Moreover, intensifying competition in the company’s operational region can be a drag on its pricing power, thereby inducing pressure on its margins.

Cincinnati Bell currently carries a Zacks Rank #3 (Hold). The company has generated a positive average earnings surprise of 66.67% in the previous four quarters. We have highlighted some of the key stats from this just-revealed announcement below:

Earnings: Cincinnati Bell reported first-quarter 2016 adjusted earnings per share of 1 cent, lower than the Zacks Consensus Estimate of 3 cents.

Revenue: Cincinnati Bell reported total revenue of $288.9 million, lagging the Zacks Consensus Estimate of $293 million.

Key States to Note: At the end of the first quarter of 2016, Cincinnati Bell had 0.2131 million residential local access lines, down 7.5% year over year and 0.3159 million business local access lines, up 2.9% year over year. Long distance lines were 0.334 million, down 6%. DSL Internet subscribers were 0.1279 million, down 14.5%. Fioptics Internet customers were 0.1645 million, up a whopping 33.6%. Fioptics video subscribers were 0.120 million, up 25.3% year over year.

Check back later for our full write up on this Cincinnati Bell earnings report later!

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