NBCUniversal launches its new Peacock streaming service.
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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 in the quarter were flat, missing the average estimate of 84,000 analysts, according to FactSet. Revenue rose 5.1% to $30.02 billion from a year earlier, helped by NBCUniversal’s theme parks and studios. 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 is seeing increasing competition for high-speed broadband, its most lucrative 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 first quarter total of 338,000.
Here are the key numbers:
- Earnings per share: $1.01, adjusted vs. estimate of 92 cents, according to Refinitiv
- Revenue: $30.02 billion vs. $29.68 billion estimate, according to Refinitiv
- High-speed Internet customers: 0 vs. 84,000 net additions, according to the average estimate of analysts polled by FactSet.
Comcast CEO Brian Roberts, in a statement, called the drop 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 on higher rates and a higher number of residential customers than a year earlier.
“We achieved our highest adjusted EBITDA margin on record even amid a unique and evolving macroeconomic environment that is temporarily pressuring our new customer connection volume,” Roberts said.
Since March 2020, Comcast has added more than 3 million broadband customers.
Video clients crash
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 accelerating rates 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 increased by 317,000. Wireless revenue increased nearly 30% year over year to $722 million. Business services rose 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.
Studio revenue rose more than 33% to $3 billion, boosted by “Jurassic World: Dominion,” which has surpassed $900 million in global box office sales.
Universal theme park business continued to recover from last year’s Covid pandemic slowdown. Revenue rose 65% to $1.8 billion. Adjusted EBITDA increased 187% to $632 million, the highest EBITDA for the parks division in the second quarter.
Peacock’s paying subscribers were 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 reach the streaming service. after their box office windows expire. “Sunday Night Football” and the World Cup, which begins Nov. 21, should also help boost Peacock’s total subscribers later this year, Comcast said.
Here’s how Comcast’s divisions did during the quarter compared to a year ago:
- Cable Communications contributed $16.6 billion in revenue, up 3.7% from the prior year
- Media generated $5.3 billion in revenue, up 3.6%
- Studios brought in $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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