Todd Williamson | peacock | NBCUniversal | Getty Images Comcast reported second-quarter revenue and earnings that beat analysts’ estimates, but the cable operator didn’t add broadband customers in a quarter for the first time. Comcast’s high-speed Internet customers in the quarter were flat, falling short of the average analyst estimate of 84,000, according to FactSet. Revenue rose 5.1% to $30.02 billion from a year ago, 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. Shares of Comcast fell more than 6% in premarket trading. Comcast is seeing 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 first quarter’s total of 338,000. Here are the key numbers:
Earnings per share: $1.01, adjusted against an estimate of 92 cents, according to Refinitiv Revenue: $30.02 billion versus an estimate of $29.68 billion, according to Refinitiv High-speed Internet customers: 0 vs. 84,000 net additions, according to the average estimate of analysts surveyed 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, driven by higher rates and a higher number of residential customers than last year. “We achieved our highest adjusted EBITDA margin on record even amid a unique and evolving macroeconomic environment that is temporarily putting pressure on our new client connection volume,” said Roberts. As of 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 rapidly ditching traditional pay-TV subscriptions 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 rose 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. The studios’ revenue rose more than 33% to $3 billion, thanks to “Jurassic World: Dominion,” which has surpassed $900 million in worldwide ticket sales. Universal’s theme park business continued to recover from the slowdown caused by the Covid pandemic last year. Revenue rose about 65% to $1.8 billion. Adjusted EBITDA rose 187% to $632 million, the parks segment’s highest-ever EBITDA for a second quarter. Peacock paid 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 hitting theaters in the third quarter — “Minions: The Rise of Gru” and Jordan Peele’s “Nope” — to help boost Peacock subscribers when they come to the streaming service. after their windows expire. “Sunday Night Football” and the World Cup, which begins Nov. 21, will also help add to the Peacock’s total subscribers 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. BEWARE: The ad market is softening, says Ritholtz’s Josh Brown
