Comcast (CMCSA) earnings Q3 2022

Comcast on Thursday reported third-quarter earnings that beat analyst estimates, regardless of seeing income barely decline and continued softness in broadband buyer progress.

The company’s shares jumped greater than 5% in premarket buying and selling.

Here’s how Comcast did within the third quarter of 2022 in contrast with what Wall Street was anticipating, based mostly on a survey of analysts by Refinitiv:

  • Earnings per share: 96 cents, adjusted vs. 90 cents anticipated
  • Revenue: $29.85 billion vs. $29.65 billion anticipated

The company stated it added 14,000 broadband clients throughout the quarter – an enchancment from the second quarter, when Comcast did not add any new clients for the primary time ever. Still, it is a signal that cable broadband suppliers are dealing with elevated competitors from telecom and wi-fi web firms.  

The slowdown in new clients is hitting the cornerstone of Comcast’s business, much like friends like Charter Communications and Altice USA. AT&T stated final week constructing out its fiber-optic community stays a precedence for the company, and it added 338,000 new clients throughout the quarter. 

“It’s still a challenging environment,” Comcast CEO Brian Roberts stated on Thursday’s name with buyers, noting how fewer individuals are shifting to new houses within the United States, in addition to elevated competitors from new entrants within the market.

Comcast’s income declined 1.5% to $29.85 billion in contrast with the identical quarter final year, when the company’s NBCUniversal unit reaped extra promoting {dollars} from airing the Tokyo Olympics on its TV networks. The company additionally took a writedown of $8.6 billion on its Sky business within the U.Ok. as a result of macroeconomic challenges affecting Europe because the struggle in Ukraine rages.

Its adjusted earnings earlier than curiosity, taxes, depreciation and amortization rose 5.9% to $9.5 billion in contrast with the identical interval final year. 

Meanwhile, Comcast’s cable unit, which incorporates pay-TV, cell and conventional cellphone companies along with broadband, noticed income improve 2.6% to $16.5 billion. The company stated broadband income jumped 5.7% on account of a rise in common charges and the variety of its residential broadband clients. 

Its Xfinity Mobile business, which was launched 5 years in the past and depends on Verizon‘s wi-fi community, now has 5 million buyer strains. 

Comcast lost 561,000 pay-TV clients, a continued quarterly decline that the company and its friends have been experiencing lately as a result of rise of streaming companies. 

Peacock, the company’s fledgling streaming service, surpassed 15 million paying clients, a rise of 70% year up to now, the company stated Thursday. 

Revenue for the NBCUniversal unit dropped about 4% to $9.6 billion when put next with the identical quarter final year, when the Tokyo Olympics befell and added $1.8 billion in income to the media section. NBCUniversal’s media section is comprised of its broadcast and cable TV networks and streaming. 

On Thursday, Comcast monetary chief Mike Cavanagh stated the company expects its media business, excluding Peacock, to be affected by cord-cutting and a few deterioration within the promoting market on account of financial uncertainty.

Due to the absence of the Olympics, the media section’s income declined roughly 23% to $5.23 billion. It would have been up 4.4% excluding the Olympics. Advertising income for the section was down 35% for a similar cause, though the company stated that was partially offset by a rise in advert income from Peacock. 

NBCUniversal’s film studios income was up 31.4% to $3.2 billion on account of greater theater and content material licensing income. The company stated theater income particularly practically doubled to $673 million primarily as a result of releases of “Jurassic World: Dominion” and “Minions: The Rise of Gru.”

NBCUniversal CEO Jeff Shell just lately stated on CNBC that he believed that the company’s film business has been performing effectively on the hybrid mannequin of releasing some movies concurrently in theaters and on streaming service Peacock – equivalent to its newest installment of the Halloween franchise – whereas nonetheless ready to make others out there to viewers at residence, equivalent to Minions. 

Peacock had a lack of $614 million in earnings earlier than curiosity, taxes, depreciation and amortization, and Comcast stated Thursday the company nonetheless expects Peacock to report losses of $2.5 billion this year.

The company’s theme park business stored up its sturdy rebound for the reason that early days of the Covid-19 pandemic, when theme parks have been shuttered. Revenue rose greater than 40% to $2.1 billion as extra individuals swarmed theme parks throughout the quarter. 

In the U.Ok., Comcast’s Sky noticed income fall 14.7% to $4.3 billion, however stated that excluding the affect of forex change, its income was per the identical quarter final year. Sky’s complete buyer rely elevated by 320,000 to 23 million, boosted by streaming buyer additions.

The $8.6 billion writedown on Sky’s business got here because the strengthening greenback affected the business on a forex foundation, and the Ukraine struggle and inflation additional affected Europe.

Comcast’s stock hit a 52-week low of $28.39 on Oct. 13. As of Wednesday’s shut, shares are down about 37% thus far this year.

Disclosure: Comcast is the father or mother company of NBCUniversal, which owns CNBC.

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