Comcast up but cord cutting continues
July 27, 2023
Comcast’s quarterly revenue beat estimates helped by higher theme park attendance and the big theatrical releases of The Super Mario Bros Movie and Fast X. Shares were up 3.5 per cent in premarket trading. But cord cutting continued and Peacock losses widened.
Total revenue rose 1.7 per cent to $30.51 billion (€27.39bn) in the quarter. In its second set of results under a new reporting structure that includes NBCUniversal in the content and experiences segment, the company reported a 4 per cent increase in revenue in the unit to $10.87 billion in the second quarter. Ad revenue in content and experiences fell 4.9 per cent from the same quarter a year prior, in a weak but stable advertising environment.
Revenue at Peacock rose 84.7 per cent compared with a year earlier. Paid subscribers increased by two million in the second quarter, to 24 million, from the 22 million it reported in the previous quarter. But adjusted losses from the platform widened to $651 million from $467 million a year ago as Comcast continues to invest heavily in content. The company has said that it expects Peacock losses to peak at around $3 billion in 2023, but expects it to steadily improve after that.
“The consistent investments we’ve been making in our growth businesses continue to generate strong results and position us extremely well both now and into the future. Second quarter operational and financial performance was excellent and included a double-digit increase in Adjusted EPS and significant free cash flow generation,” said Brian Roberts, Chairman and CEO. “This quarter contained a number of highlights and notable achievements. We not only continued to deliver solid revenue growth in our connectivity businesses but also expanded our Adjusted EBITDA margin at Connectivity & Platforms. We generated the best quarterly Adjusted EBITDA ever at Theme Parks, had the second-highest grossing animated film of all time in worldwide box office revenue with Super Mario Bros., and nearly doubled paid Peacock subscribers year-over-year.”
The company has trailed that anyone getting Peacock for free will have to start paying from this summer.
Comcast’s total connectivity and platforms revenue, which includes the cable business and most of its Sky unit, reported a 0.1 per cent gain in revenue. But Comcast lost 19,000 broadband customers in the quarter, and 543,000 video customers as cord cutting continues at pace.
Overall, net income attributable to Comcast rose 25.1 per cent to $4.25 billion in the quarter.