Comcast's Earnings Get Some Help from 'Minions'
October 27 2015 - 7:32AM
Dow Jones News
By Shalini Ramachandran
Comcast Corp. reduced its video customer losses in the third
quarter, as its NBCUniversal media arm surged thanks largely to the
success of blockbuster films like "Minions."
The cable company's quarterly profit dropped 23% compared with
the prior-year quarter, when a $724 million tax-related benefit
boosted its results.
Excluding certain gains and costs, adjusted profit per share for
the latest quarter increased to 80 cents, up from 73 cents a share
the year earlier. Revenue grew 11.2% to $18.67 billion. Analysts
were projecting adjusted earnings of 80 cents a share on $18.03
billion in revenue, according to estimates from Thomson
Reuters.
Comcast has been exploring new growth areas since it walked away
from its bid to acquire Time Warner Cable in April amid regulatory
pressure. It has announced several new streaming services,
including a $15-a-month skinny TV bundle dubbed "Stream," Seeso, a
$3.99-a-month comedy-focused service, and a short-form video
service called "Watchable." The company is also in talks with
several companies about licensing its valuable trove of television
viewing data.
After years of dancing around wireless, Comcast is also
seriously exploring an entry into the industry. In the past couple
months Comcast informed Verizon Communications Inc. that it would
like to execute on a 2011 agreement to resell Verizon's airwaves to
offer cellphone service, according to a person close to Comcast.
Analysts believe the company is working toward offering a
"Wi-Fi-first" service that would primarily lean on its roughly 11
million Wi-Fi hot spots and use carriers' airwaves to patch up the
holes in coverage.
Comcast's broadband and business services divisions posted
strong revenue growth in the third quarter, offsetting video
customer losses and softness in the voice business.
Comcast shed 48,000 cable TV customers, an improvement compared
with 81,000 a year ago. It added 320,000 broadband customers in the
quarter compared with 315,000 a year earlier. Voice customer
additions slowed dramatically from 68,000 in the year-earlier
period to 17,000, as the company focused on promoting "double-play"
bundles of video and broadband rather than the "triple play."
Broadband revenue increased 10.2% to $3.1 billion, while voice
revenue fell 1.4% to $900 million. Business-services revenue jumped
19.5% to $1.2 billion. Video revenue grew 3.3% to $5.3 billion, as
higher rates offset customer losses. Overall, the cable business,
which accounts for the bulk of the top line at Comcast, saw revenue
rise 6.3% to $11.7 billion.
At NBCUniversal revenue jumped 21% to $7.2 billion, powered by
strong growth at the filmed entertainment division and theme parks.
Operating cash flow at NBCU increased 17% to $1.7 billion.
Revenue grew 7% at the unit that includes the company's cable TV
networks, despite ongoing ratings pressures, but operating cash
flow--a measure of profitability--declined 3.9% due to increased
programming expenses from the licensing of Nascar rights. Revenue
at the broadcast-TV segment, which includes the flagship NBC
network, grew 11.3%, while operating cash flow grew 6.1% to $150
million.
Thanks to hits like "Jurassic World," "Minions," and "Furious
7", the filmed entertainment division is having a blowout year,
with operating cash flow growing from $151 million a year ago to
$376 million in the latest quarter. Operating cash flow at the
theme parks segment increased 14.1% to $458 million.
Write to Shalini Ramachandran at
shalini.ramachandran@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
October 27, 2015 07:17 ET (11:17 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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