Broadband provider Talktalk today said its first quarter trading was in line with expectations, as growing demand for high-speed internet boosted sales.
The telecoms firm posted a 1.3 per cent rise in revenue to £387m in the three months to the end of June, and said its full-year guidance remains unchanged.
Talktalk said the figures were boosted by insatiable demand for full-fibre broadband, with up to 75 per cent of new customers now choosing the high-speed network.
The increased take-up of more expensive broadband also pushed up average customer spend, which grew to £24.72 in the quarter. Shares in Talktalk rose three per cent following the announcement.
Talktalk has been rocked by poor feedback over customer service, ranking at the bottom of an Ofcom report earlier this year.
This has been compounded by the fallout from a 2015 data breach, which led to the theft of personal data from more than 150,000 customers. In May the firm admitted that it had failed to notify almost 5,000 customers affected by the cyber attack.
However, Talktalk will be hoping its efforts to speed up its fibre broadband network will win over customers looking for faster, more reliable internet connections amid the rise of video streaming services such as Netflix and Amazon Prime.
Talktalk said it is also making progress in its plan to cut up to £30m per year in costs. The company is shifting to a self-service model, and is moving its headquarters from London to Salford.
“Talktalk is now into the third year of its turnaround plan, but question marks remain over whether its focus on gaining market share will ultimately boost its profits,” said Fiona Cincotta, senior market analyst at City Index.
“Talktalk is continuing to add customers as more and more households order faster broadband to facilitate their Netflix and Amazon binges. The problem is that competition in the telecom sector is rife and Talktalk is having to offer relatively low prices to win market share.”
Separately, the company said non-executive directors John Allwood and Cath Keers will step down from the board.
Chief executive Tristia Harrison said: “Our ongoing simplification and cost reductions continue to drive improvement in profitability, and we remain on track to deliver earnings before interest, tax, depreciation and amortisation in line with expectations for the year.”
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