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Release Date: 08/05/2010

(NEW YORK, NY) – Time Warner Cable Inc. (NYSE: TWC) today reported financial results for its second quarter ended June 30, 2010.

Time Warner Cable Chief Executive Officer Glenn Britt said: “I’m very pleased with our performance in the second quarter, highlighted by accelerated revenue growth in our advertising and commercial businesses, steady revenue increases in our residential subscription operations and particularly strong free cash flow growth. Through our consistent focus on the fundamentals – better understanding our customers’ needs and improving the efficiency of our operations – we continue to deliver attractive financial results and create value for our shareholders.”

for the second quarter of 2010 increased 5.8% from the second quarter of 2009 to $4.7 billion. Subscription revenues grew 5.1% year-over-year to $4.5 billion, driven by a 4.2% increase in residential subscription revenues and a 20.2% increase in commercial subscription revenues. Advertising revenues increased 24.1% to $216 million. Residential subscription revenue growth was driven by increases in high-speed data, video and voice revenues. The growth in residential high-speed data revenues was the result of growth in high-speed data subscribers and, to a lesser extent, increases in average revenues per subscriber. Residential video revenues increased as a result of video price increases, the continued growth of digital video subscribers and increases in DVR service revenues and transactional video-on-demand revenues, partially offset by a year-over-year decline in video subscribers. The growth in residential voice revenues was driven by an increase in Digital Phone subscribers, partially offset by a decrease in average monthly revenues per Digital Phone subscriber. Commercial subscription revenue growth was due primarily to increases in Business Class Phone and commercial high-speed data subscribers and an increase in cell tower backhaul and Metro Ethernet revenues. Advertising revenue growth was driven by year-over-year increases in a wide range of categories, most significantly automotive and political.

Adjusted Operating Income before Depreciation and Amortization (“Adjusted OIBDA”) rose 6.0% over the second quarter of 2009 to $1.8 billion. The increase was driven by revenue growth, partially offset by a 5.7% increase in operating expenses. In particular, video programming expenses grew 5.8% to $1.1 billion, employee expenses were 4.0% higher at $954 million, marketing expense was up 21.9% to $156 million, and voice costs increased 6.4% to $167 million. These increases were partially offset by a decrease in bad debt expense, which declined 21.6% to $40 million. Video programming expenses increased due to contractual rate increases, incremental retransmission consent expense and higher transactional video-on-demand expense offset, in part, by a decline in video subscribers and premium channel subscriptions. The growth in employee expenses was driven by higher headcount and compensation, partially as a result of increased costs associated with commercial service-related employees, and increases in employee medical expense offset, in part, by a decrease in pension expense. Marketing expenses increased primarily as a result of the timing of marketing spending. Voice costs increased due to subscriber growth. Bad debt expense declined primarily due to improvements in collection efforts. Operating Income was up 4.1% over the second quarter of 2009 to $918 million primarily as a result of higher Adjusted OIBDA, partially offset by higher depreciation expense and an increase in restructuring costs.

Adjusted OIBDA for the second quarter of 2010 excludes the expenses noted in the table below.

Net Income Attributable to TWC Shareholders was $342 million, or $0.96 per basic and $0.95 per diluted common share, respectively, for the second quarter of 2010. Note 1 to the accompanying consolidated financial statements details certain items affecting the comparability of net income attributable to TWC shareholders for the second quarter of 2010 to that for the second quarter of 2009, which reduced both basic and diluted earnings per share by $0.02 in each period. Excluding these items, second-quarter 2010 net income attributable to TWC shareholders increased compared to the prior year period, primarily reflecting higher Operating Income, partly offset by increases in other expense, net and income tax provision.

Adjusted OIBDA less Capital Expenditures for the first six months of 2010 totaled $2.0 billion, a 19.6% increase over the first six months of 2009, due to higher Adjusted OIBDA and lower capital expenditures. Capital Expenditures were $1.5 billion in the first six months of 2010, a 3.7% decrease from the first six months of 2009, largely reflecting lower residential capital spending, partly offset by higher commercial capital spending. The decline in residential capital spending was primarily attributable to lower spending on support capital and customer premise equipment. The increase in commercial capital spending was primarily related to higher spending on line extensions and scalable infrastructure.

Free Cash Flow for the first six months of 2010 increased 18.6% to $1.2 billion from $1.0 billion in the first six months of 2009, due mainly to higher cash provided by operating activities and a decrease in capital expenditures. Cash Provided by Operating Activities for the first six months of 2010 was $2.7 billion, a 4.7% increase from $2.6 billion in the first six months of 2009. This increase was related primarily to higher Adjusted OIBDA, an improvement in working capital requirements, and lower pension plan contributions, offset partly by increases in second quarter cash tax and interest payments.

Net Debt and Mandatorily Redeemable Preferred Equity totaled $20.7 billion as of June 30, 2010, down $850 million since December 31, 2009, driven by Free Cash Flow offset, in part, by the quarterly cash dividend payments and the increase in the fair value of debt subject to interest rate swap contracts (which was equal to the increase in the fair value of the underlying swaps, which are separately recorded as assets on the balance sheet).

Primary Service Units (“PSUs”)
increased by 60,000 to 26.7 million. Triple Play Subscriber net additions were 68,000 in the second quarter and bundled subscribers totaled 8.5 million, or 59.0% of total customer relationships as of June 30, 2010.

Non-GAAP Financial Measures
The Company refers to certain financial measures that are not presented in accordance with U.S. generally accepted accounting principles (“GAAP”), including Operating Income (Loss) before Depreciation and Amortization, Adjusted OIBDA, Adjusted OIBDA less Capital Expenditures and Free Cash Flow. Refer to Note 2 to the accompanying consolidated financial statements for a discussion of the Company’s use of non-GAAP financial measures.

About Time Warner Cable

Time Warner Cable is the second-largest cable operator in the U.S., with technologically advanced, well-clustered systems located mainly in five geographic areas — New York State (including New York City), the Carolinas, Ohio, Southern California (including Los Angeles) and Texas. Time Warner Cable serves more than 14 million customers who subscribe to one or more of its video, high-speed data and voice services. Time Warner Cable Business Class offers a suite of phone, Internet, Ethernet and cable television services to businesses of all sizes. Time Warner Cable Media Sales, the advertising arm of Time Warner Cable, offers national, regional and local companies innovative advertising solutions that are targeted and affordable. More information about the services of Time Warner Cable is available at, and

Additional details on financial and subscriber metrics are included in the Trending Schedules posted on the Company’s Investor Relations website at

Information on Conference Call
Time Warner Cable’s earnings conference call can be heard live at 8:30 am ET on Thursday, August 5, 2010. To listen to the call, visit


Caution Concerning Forward-Looking Statements
This document includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations or beliefs, and are subject to uncertainty and changes in circumstances. Actual results may vary materially from those expressed or implied by the statements herein due to changes in economic, business, competitive, technological, strategic and/or regulatory factors, and other factors affecting the operations of Time Warner Cable Inc. More detailed information about these factors may be found in filings by Time Warner Cable Inc. with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Time Warner Cable is under no obligation to, and expressly disclaims any such obligation to, update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise.

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Corporate Communications
Alex Dudley      (212) 364-8229
Justin Venech (212) 364-8242

Investor Relations
Tom Robey         (212) 364-8218
Laraine Mancini (212) 364-8202

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