As for Internet access, through its At Home branded service, the company had 89,000 customers, up 270 percent from this last time last year. And the number of telephony customers hit nearly 42,000 in the first quarter, up 131 percent from a year earlier. Spencer Grimes, a media analyst at investment banker Solomon Smith Barney who follows Cox Communications, agrees. Grimes is less convinced, though, that providing telephone service through a digital cable network will pay off. After years of expensive rebuilding and questions about its investment in digital technology, Cox Communications is on a roll.
All financial indicators are up.
One factor driving up revenue and cash flow is the growing number of cable TV subscribers. Through acquisition, the company has more than doubled its number of customers to 4 million in the past four years. While financial fundamentals are strong, Cox Communications faces several challenges. For one, while growing, digital services are in their infancy. Homes with cable modems represent only 3 percent of Cox Communications' total subscribers.