Comcast reported bigger-than-expected third-quarter earnings as broadband revenues rose, Peacock losses declined and the company’s theme-park business boomed.
Cord-cutting continued to affect Comcast’s cable TV business, as it lost another half-million video customers in the quarter. Concerns about broadband competition also drove the stock lower this morning as the company shed 18,000 subscribers when a small subscriber gain was forecasted.
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Peacock’s losses dropped as the streaming service added 4 million paid subscribers in the quarter, giving it 28 million, up 80% from a year ago. Comcast stopped giving free Peacock subscriptions to its cable customers.
Peacock recorded a $565 million loss in the quarter, compared to a $614 million loss a year ago, as revenue rose 64% to $830 million.
Speaking on the company’s third-quarter earnings call, Comcast president Michael Cavanagh said that the company still expects losses for Peacock to peak in 2023, but said the company now believes 2023 losses for the streaming platform will be $2.8 billion versus the previous forecast of $3 billion. Losses should further improve in 2024, Cavanagh said.
Overall, Comcast’s net income was $4.05 billion, or 98 cents a share, compared to a loss of $4.6 billion, or $1.05 a share a year ago, when the company took a big writeoff on its acquisition of Sky.
Revenues rose 0.9% to $30.1 billion.
Earnings before interest, taxes, depreciation and amortization at Comcast’s content and experiences businesses rose 10.2% as revenues edged up 0.8% to $10.6 billion on the strength of the company’s theme parks unit.
Media (NBCUniversal) EBITDA rose 6.5% to $723 billion as revenues rose 0.4% to $6 billion.
Domestic advertising revenues fell 8.4% to $1.9 billion while domestic distribution revenue rose 38% to $2.6 billion.
Theme-park profit rose 20% to $983 million as revenue rose 17.2% to $2.4 billion
Earnings for Comcast’s connectivity and platforms (cable) business rose 2.6% to $8.2 billion as revenues edged up 0.2% to $20.3 billion.
Comcast lost 490,000 domestic video customers in the quarter, giving it a total of 14.5 million.
The company also lost 18,000 domestic broadband customers, including 17,000 residential customers, giving it 29.8 million domestic broadband customers.
Wireless customers rose by 294,000 to 6.3 million.
Revenue from domestic broadband rose 3.8% to $6.4 billion, while revenue from video fell 3.5% to $7.2 billion.
Advertising revenue fell 12.4% to $960 million in a non-election quarter.
Programming expenses fell 1.3% to $4.5 billion as rate increases were offset by a decline in video subscribers.
“We delivered strong financial results in the third quarter, while also investing in long-term growth, accelerating share-repurchase activity and maintaining our healthy balance sheet,” Comcast chairman and CEO Brian Roberts.
"Our strategic focus on innovation and financial discipline facilitated by consistent execution positions us competitively both now and into the future,” Roberts said.
