NBCUniversal has launched its new Peacock streaming service.
Todd Williamson | Peacock | NBCUniversal | Getty Images
Comcast reported second-quarter revenue and earnings that beat analysts’ estimates, but the cable provider didn’t add broadband customers in a quarter for the first time.
Comcast’s high-speed Internet customers were flat in the quarter, missing the average analyst estimate of 84,000, according to FactSet. Revenue rose 5.1% to $30.02 billion from a year earlier, helped by NBCUniversal’s theme parks and studios businesses. Adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, rose 10.1% to $9.8 billion.
Comcast shares fell more than 6% in premarket trading.
Comcast sees increasing competition for high-speed broadband, its most profitable product. For more than a decade, the cable industry has dominated the home broadband market, but wireless companies like T-Mobile are now competing by offering 5G home Internet products. T-Mobile added 560,000 broadband users in the second quarter, well above the 338,000 total in the first quarter.
Here are the basic numbers:
- Earnings per share: $1.01, adjusted for a forecast of 92 cents, according to Refinitiv
- Revenue: $30.02 billion vs. $29.68 billion forecast, according to Refinitiv
- High-speed Internet customers: 0 vs. 84,000 net additions, according to the average estimate among analysts polled by FactSet.
Comcast CEO Brian Roberts in a statement called the decline temporary as macroeconomic conditions such as higher inflation limit the number of new connections for the company. Broadband revenue rose 6.8% year over year to $6.1 billion in the quarter due to increased rates and a higher number of home customers than a year earlier.
“We achieved our highest adjusted EBITDA margin in history even against the backdrop of a unique and evolving macroeconomic environment that temporarily pressured our new client volume,” Roberts said.
As of March 2020, Comcast has added more than 3 million broadband customers.
Video clients are falling
Comcast lost 521,000 video customers in the quarter and lost 1 million video subscribers in the first six months of 2022. Consumers are ditching traditional pay TV subscriptions at an accelerated rate in favor of streaming options like Netflix, Disney+, HBO Max and NBCUniversal’s Peacock.
Brian Roberts, Chairman and CEO of Comcast
David A. Grogan | CNBC
Voice customers fell by 286,000 in the quarter, although wireless subscribers jumped by 317,000. Wireless revenue rose nearly 30% year over year to $722 million. Business services grew 10% to $2.4 billion.
NBCUniversal
NBCUniversal’s revenue rose 18.7% in the quarter to $9.4 billion. NBCUniversal’s adjusted EBITDA rose 19.5% to $1.9 billion.
The studios’ revenue rose more than 33% to $3 billion, driven by “Jurassic World: Dominion,” which surpassed $900 million in global box office sales.
Universal’s theme park business continued to recover from last year’s slowdown due to the Covid pandemic. Revenue jumped about 65% to $1.8 billion. Adjusted EBITDA increased 187% to $632 million, the parks division’s highest-ever second-quarter EBITDA.
Peacock’s paid subscribers remained flat at 13 million after a gain of 4 million last quarter. Comcast said it expects “Jurassic World: Dominion,” along with two movies released in theaters in the third quarter — “Minions: The Rise of Gru” and Jordan Peele’s “Nope” — to help boost Peacock subscribers when come to the streaming service after their box office windows expire. “Sunday Night Soccer” and the World Cup, which begins Nov. 21, should also help boost Peacock’s subscriber totals later this year, Comcast said.
Here’s how Comcast’s divisions fared for the quarter compared to a year earlier:
- Cable Communications contributed $16.6 billion in revenue, up 3.7% year over year
- Media brought in $5.3 billion in revenue, up 3.6%
- Studios contributed $3 billion in revenue, up 33.3%
- Theme parks brought in $1.8 billion in revenue, up 64.8%
- Sky contributed $4.5 billion in revenue, down 13.8%
Disclosure: Comcast is the parent company of NBCUniversal, which includes CNBC.
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