Comcast's second-quarter earnings surpassed predictions from analysts. The rate of growth in their broadband sector remained sluggish, but this was partly balanced out by the rise in prices. Subscribers to Peacock amounted to 24 million, nonetheless the streaming service is still incurring losses. Comcast CEO Brian Roberts said his company would not be interested in any such sale.
Comcast exceeded analyst expectations on Thursday when it revealed its second-quarter results, due to higher pricing that negated the deceleration of its broadband operations.Revenue from Comcast's streaming service, Peacock, nearly doubled from the prior year, climbing 85% to $820 million, even though losses related to the streaming platform kept pressure on NBCUniversal's media business. In response, shares of Comcast rose by more than 7%.Refinitiv survey results showed that Comcast surpassed expectations on both income per share and revenue. Income per share stood at $1.13 after adjustments, while anticipated results were 97 cents; the revenue achieved was $30.51 billion, versus an anticipated $30.13 billion.For the quarter that ended on June 30th, the company reported earnings of $4.25 billion, or $1.02 per share, compared to $3.4 billion, or 76 cents per share, in the same period the year before. After making necessary adjustments, earnings per share were recorded at $1.13.This was the most significant earnings beat in the past two years.Comcast restructured their reporting of segments earlier in the year. Their Xfinity-branded wireless, broadband, and cable TV services are now grouped with their Sky U.K. services. Total revenue for this segment was negligible compared to the prior year, at $20.36 billion.During the quarter, the company's domestic broadband subscribers declined by 19,000, leaving them with a total of 32.3 million customers when the period ended.It was previously predicted that Comcast would lose more than 70,000 customers during the quarter, but this was not the case. The higher average rates made up for the losses, resulting in a 4.4% surge in broadband revenue.Comcast anticipates that in time their broadband customer base will experience growth again, but did not offer an exact timeline.The Xfinity mobile consumer base underwent development as well, reaching 6 million customers.Even with the strong results, Comcast President Mike Cavanagh acknowledged on the earnings call the company's 'acuity about the issues that both they and their competitors are facing'. Cord cutting, Hollywood strikes, and the economic climate have been causes of concern recently.Cord cutting has become more prominent in recent months, leading Disney CEO Bob Iger to consider if the company's cable TV networks were still a core business. If the channels were to be sold, Roberts stated Comcast would not be pursuing them.
NBCUniversal, a company under the Comcast umbrella, owns a collection of cable TV channels such as USA Network and Bravo. A lot of the content on Peacock – like Premier League Soccer and TV show reruns – is pulled from these networks. Even though Peacock subscribers and income increased, the streaming platform's losses still had a negative impact on the media division. Peacock's adjusted losses were $651 million, a growth from $467 million from the same period the year before. Comcast expects that losses from Peacock will reach about $3 billion this year. CFO Jason Armstrong reassured investors by saying that the company plans to "bullish on further increasing the Peacock subscriber base," as more Xfinity users become paid members and with a strong selection of programming in the upcoming months, such as the release of "The Super Mario Bros. Movie" and "Sunday Night Football" in the fall.
Peacock gained two million customers due to Xfinity subscribers that started to pay for subscriptions in June after having free access for almost three years. NBCUniversal is part of the "content and experiences" branch of Comcast's business, which also involves TV and streaming, international networks, Sky Sports, film studios, and theme parks. This section earned $10.87 billion in revenue, which is a 4% increase compared to the same period last year. The media business earned $6.2 billion in sales, not much different from the previous year. Domestic advertising revenue dropped by 5% to $2.03 billion due to a reduction in NBCUniversal's TV networks sales, but this was partly offset by the rise in Peacock revenue. NBCUniversal's upfront discussions reportedly led to $7 billion in cash commitments for 2022, which is on par with last year's and the highest ever. The film studios generated $3.09 billion in sales, a 1% decrease from the same period last year. This decline was offset by large ticket sales from "The Super Mario Bros. Movie" and "Fast X." NBCUniversal was the second highest in box office earnings for the year, with the release of "Oppenheimer" bringing in more than $82 million in its opening weekend. The parks branch earned $2.21 billion in revenue, a 22% growth from before the pandemic owing to the opening of Super Nintendo World at Universal's Hollywood park and growth in Beijing and Japan's parks. However, Orlando park earnings dropped. Disney's Orlando theme parks have recently seen a decline in traffic due to increased ticket prices.
Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.
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