Cablevision Systems Corp's quarterly earnings widely missed Wall Street estimates as it faced a weak economy, high programing costs and increased competition from phone companies offering TV services.
Cablevision shares fell more than 14 percent on the profit miss of 14 cents per share.
Cable companies have been losing video customers to phone companies such as Verizon Communications, which offers FiOs TV, satellite providers as well Internet companies such as Netflix Inc and Hulu.
Cablevision was the second cable company in two days to report disappointing earnings and then have it shares fall by double digits. On Thursday, Time Warner Cable lost more video customers than expected and its shares fell 10 percent.
Cablevision, which mainly serves the New York area but now has operations in Montana and Wymoming, said it lost 19,000 video subscribers in the third quarter.
While some analysts were expecting deeper losses, Wall Street was not impressed with Cablevision's results on Friday.
Cablevision's numbers are very weak, said Brean Murray analyst Todd Mitchell. They are having trouble in their New York clusters.
Verizon competes with Cablevision in the greater New York area and in the same period it added 131,000 video customers. Earlier this month, Verizon said it expects to add 200,000 FiOS TV customers in the fourth-quarter.
Cablevision executives also blamed the weak economy for stunting housing growth and hurting its business. If people are not moving into new homes, they will not sign up for new TV service. The company's finance chief called it a cyclically challenging time.
You have a situation currently where you have pretty slow housing growth, virtually no housing growth, and actual reduction in household formation, said Cablevision's CFO Gregg Seibert on the conference call.
Cablevision also said its revenue took a hit of $16 million
because of Hurricane Irene, a storm that affected the New York area in August.
One bright spot for Cablevision was its Internet additions. Analysts were expecting it to add 5,000 new Internet customers and it added 17,000 in the quarter.
Cablevision posted a profit of $39.3 million or 14 cents per share, down from $68.4 million, or 23 cents per share, a year earlier.
Adjusted for various charges, the company reported an EPS of 17 cents, which missed analysts' expectations of 31 cents per share.
Cablevision, which is controlled by the Dolan family and also owns a newspaper and TV networks, saw its total revenue increase 8 percent to $1.67 billion, which was in line with analysts' estimates, according to Thomson-Reuters I/B/E/S.
The company's shares fell $2.49 to $14.82 on the New York Stock Exchange.
(Reporting by Liana B. Baker in New York, editing by Gerald E. McCormick, Dave Zimmerman)