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Rogers Posts Better-than-Expected Q3 Profits, as Wireless Competition Looms

8:46 pm on October 27, 2009 | Category: Business, Corporate, Wireless

Toronto-based cable and media giant, Rogers Communications, reported higher-than-expected third-quarter profits today, as strong mobile data revenues continued to cushion its bottom line.

Net income fell slightly to C$485 million, or $0.79 per share, from C$495 million in the same period a year earlier. Excluding one-time costs, however, the company generated $0.82/share in profits, greatly exceeding the $0.54/share average estimate of industry analysts.

Mobile data revenue increased by 46% compared to last year, as Rogers Wireless continued to benefit from its monopoly on the Apple iPhone in Canada. Now that rivals Bell and Telus are launching their own HSPA data networks, however, Rogers is sure to experience intense competition in the 3G smartphone market. The iPhone, and a host of other devices previously available only through Rogers, will soon be sold by all three of Canada’s major carriers.

“It was a good quarter but, fundamentally, the problem is youâ€™ve lost your HSPA monopoly and youâ€™re going to have market share pressure as a result as the other guys have the same devices as you do,” said Genuity Capital Markets analyst, Dvai Ghose, advising Rogers shareholders to ‘hold’ but not ‘buy’ the company’s stock.

Rogers shares jumped $1.56, or 5.4% today, to close at $30.46 on the Toronto Stock Exchange.

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