Comcast Corporation (CMCSA) on Q1 2021 Results - Earnings Call Transcript
Operator: Good morning, ladies and gentlemen, and welcome to Comcast First Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. Please note that this conference call is being recorded. I will now turn the call over to Senior Vice President, Investor Relations, Ms. Marci Ryvicker. Please go ahead, Miss Ryvicker. Marci Ryvicker: Thank you, operator, and welcome, everyone. Joining me on this morning’s call, are Brian Roberts, Mike Cavanagh, Dave Watson, Jeff Shell, and Dana Strong. Brian and Mike will make formal remarks, while Dave, Jeff and Dana will also be available for Q&A. Brian Roberts: Thanks, Marci, and good morning, everyone. We certainly got off to a great start this year. Our entire Company performed well, and we once again had particularly strong results at Cable, which posted its third consecutive quarter of double-digit EBITDA growth, ninth consecutive quarter of double-digit net cash flow growth. We added 461, 000 broadband customers, which drove 380,000 customer relationship additions. This is the best first quarter on record. Our connect activity was healthy and broadband churn improved for the 13th quarter in a row, hitting our lowest churn rate in our Company’s history. I’m very proud of this quarter’s results and our long record of growth, which I believe is a direct result of disciplined investment, fantastic innovation and consistent execution in a highly competitive market. This morning, I’d like to go a bit deeper in two areas, the robustness of our network in the U.S. and more broadly how we positioned ourselves to successfully compete against alternative providers and technologies. We’ve spent nearly $30 billion in the last decade, building an expansive fiber dense network comprised of 191, 000 route miles that carries an immense amount of traffic has demonstrated extraordinary performance throughout the pandemic. Under Tony Werner, our retiring Chief Technology Officer, we have consistently engineered our network to anticipate change. And during his 15-plus years at Comcast, he has helped transform us into a product and technology innovator and leader. Tony, we thank you. He’s being succeeded by Charlie Herrin. Many of you on this call are familiar with Charlie. He helped develop game-changing products, including scaling X1 and most recently led a successful effort to redefine how we interact with customers, which has resulted in significantly higher NPS scores and lower operating costs. Charlie, Dave and I have been fortunate to work together for 20 years. Under Dave and Tony, we’ve recruited the best engineering talent around the world and now are working as one global tech team to create platforms, apps and experiences that evolve the way people connect and consume entertainment. We’ve done all this while keeping the network our number one priority. Mike Cavanagh: Thanks, Brian, and good morning, everyone. I’ll begin on slide 4 with our first quarter consolidated 2021 results. Revenue increased 2.2% to $27.2 billion. Adjusted EBITDA increased 3.5% to $8.4 billion. Adjusted EPS increased 7% to $0.76 per share. And finally, we generated $5.3 billion of free cash flow. Now, let’s turn to our business segment results starting with Cable Communications on slide 5. Cable revenue increased 5.9% to $15.8 billion. EBITDA increased 12% to $6.8 billion and EBITDA less capital grew 16% to $5.1 billion. We added 380,000 net new customer relationships, up 2.4% over last year’s first quarter and up 27% over the first quarter of 2019. This was the best first quarter on record and was driven by broadband, where we added 461,000 net new residential and business customers, only slightly below last year’s first quarter and 23% above the first quarter of 2019. We saw healthy connect activity, and this quarter marked the lowest broadband churn in our history. This positive momentum has continued into the second quarter. And from what we see today, we anticipate total broadband additions for the year to grow by mid-single-digit levels compared to 2019, which, aside from the extraordinary growth we had in an unusual 2020 was the best year in more than a decade. The strong customer additions, coupled with ARPU growth of 4.4%, drove a 12% increase in broadband revenue for the first quarter, the largest driver of overall cable revenue, and we expect this trend will continue. We also saw an acceleration in both, business and wireless. Business services revenue increased 6.1% and delivered 11,000 net new customer additions, primarily driven by continued improvement in small business. Wireless revenue grew 50% and due to an increase in both customer lines and higher device sales. We added 278,000 net new lines in the quarter, the best results since launching this business in 2017, bringing us to 3.1 million total lines as of quarter end. Marci Ryvicker: Thanks, Mike. Regina, let’s open the call for questions, please. Operator: Thank you. Our first question comes from the line of Jessica Reif Ehrlich with Bank of America Securities. Please go ahead. Jessica Reif Ehrlich: Thank you. Good morning. The Company clearly is on an upswing as we come out of COVID and the leverage in the business is really apparent in the first quarter numbers. So, I have a broad-based question that covers basically all the divisions. In Cable, it feels like they’re beginning for advanced advertising. We’re seeing strength still in broadband, the price decrease in mobile should drive market share. In NBCU, which seems like the division with the most upside coming out of COVID, I’m just -- I don’t know if this is the year of peak losses for Peacock, but Theme Parks seem like they’re on a 5-year growth trend, advertise -- production is coming back, et cetera. Sky, you can see the leverage. So, my question finally is, where do you see the most leverage overall in each of the businesses? And can margins and free cash flow continue to improve? Brian Roberts: Well, thank you, Jessica, for those comments. Why don’t we just go around the horn and why don’t we just go from Dave to Dana to Jeff, and everybody give a crack at their view of the business and a chance for them to introduce themselves on the call here. Dave Watson: Thank you, Jessica. This is Dave. Start with -- our focus continues to be maintaining momentum around the connectivity side of the business. So, broadband, residential, commercial is enormously important and a great growth engine for us. So, we’re going to continue to enhance broadband, keep adding to it, speed, control coverage and now streaming, and as you mentioned, mobile. So, we’re going to focus on accelerating mobile and just surrounding broadband with these products. So, that’s going to be -- that’s our strategy, nothing will shake that. And in terms of EBITDA that we are -- we like our -- the recurring revenue aspect of the connectivity business. We like the margins that, that contributes towards. We’re very focused on taking out the transactions that cause customer noise. And so, focusing on digital, focusing on things like self-install kits, those -- all the things that we’ve been talking about will continue. So, I feel very good about our position in the marketplace. So, there’s a lot of upside still in broadband, feel good about mobile and business services. Dana Strong: Thanks, Jessica. This is Dana, following up from Dave’s side. From the Sky angle, we’re really, really happy with the fundamentals of the business. I think Q1 -- our Q1 results demonstrate the position that we’re in, subscriber numbers up, that’s in fact, quarter one in about six years, churn is down, revenue is up. All of the fundamental factors of the business position us well to exit COVID. To be more specific on your question in regards to where do we see the most leverage, if I had to boil it down, I would say, the UK, the UK is an extraordinary position for growth. We got a very diverse revenue base with DTH having its best performance in Q1 in six years, streaming is going well, mobile is going very well, broadband is growing well with a lot of innovation potential. And so, I think what we see in the UK is a lot of growth left in that business and a really solid business to build upon in the rest of the portfolio. Jeff Shell: Hi, Jessica, this is Jeff. And everybody. So, there’s a lot of different places I could pick and choose from NBCUniversal, but let me just talk about two points of leverage that I’m excited about. I think, first of all, as we’ve talked about in previous calls, we really adjusted our cost base across the entire Company during the pandemic. We didn’t do this just to cut cost. We obviously looked at where the business was going and changed our organization, particularly on the TV side, but I’m excited about the business being kind of adjusting the new cost base and as we grow revenue side, that’s going to help. And then, the obvious other one that really was affected and has been affected during the pandemic is our Parks business, which normally is a really, really great business. But obviously, during a pandemic when you close, it’s not a good business. It’s going to be choppy, getting open again as things surge and come back and so forth, but it’s hard not to get excited about our Parks business. So, the demand is there. We’re seeing it in Orlando. We have no international travel yet, which is a significant part of the business, and we still are hitting capacity, the capacity we’ve set for ourselves based on safety protocols every day. Just reopened Hollywood and we’re seeing the same thing in Hollywood. Japan is obviously going back and forth, but we’re excited long-term about that park and then Beijing coming. And the other thing that’s happened during the pandemic is we’ve continued to build attraction. So, we are hitting the front of the market with some pretty exciting attractions in each of our parks. We have Nintendo, which we think is one of the great attractions that we’ve ever built in Japan and come in Beijing as well. We have out in Los Angeles, our new pets attraction, we’re getting stellar reviews and people love it. And then, most excitingly to me, we have a new roller coaster in Orlando called the VelociCoaster and Jurassic roller coaster, which I rode a couple of weeks ago. It is both, spectacular and petrifying. And I think when we open that to the public in June, going to be another driver for our business. So, I’m very excited about the Parks business. And it’s the one business that’s going to come back really strongly from the depth of pandemic. Mike Cavanagh: And maybe -- it’s Mike. I’ll just jump in after the -- and put it all together because I think the ultimate question was what happens with free cash flow over time, what’s our confidence. And I think, as we’ve been saying, pre-COVID for a couple of years, in my tenure, we’ve been investing in -- we love our businesses. We’ve been investing so they stay relevant and strong years into the future. And while free cash flow is always lumpy, as you’re in different periods of time, we’ve been confident that we are going to grow free cash flow in the years ahead on a multiyear basis. COVID got in the way, obviously, of that story, but that’s, as you recall, what we felt pre-COVID, and I continue to feel that way as we sit here now. And as everybody just chimed in, I think we see the light at the end of the tunnel of COVID. And all of the earnings power of our businesses that we felt were there before, COVID, I think these results say that they’re still there and perhaps then some. Operator: Your next question comes from the line of Doug Mitchelson with Credit Suisse. Please go ahead. Doug Mitchelson: I guess, maybe there are two quick ones. But Dave, on your side, the new wireless pricing, does that suggest another investment round in wireless, or would you just look at that as consistent with the focus on trying to drive share there? Ultimately, what’s the wireless strategy? And what are you hoping the new pricing levels to accomplish? And Jeff, just path for Peacock monetization with engagement coming in double expectations, my guess is, you haven’t seen much difference relative to your revenue expectations because of limits on advertising. Can you just remind us when does that advertising inventory get opened up to new advertisers? And how will Peacock monetization progress from here? Thank you. Dave Watson: Doug, this is Dave. I’ll start. So, our wireless strategy has been very consistent also. And the new unlimited plans are an opportunity for us to improve that value proposition still have by the gig. Now introducing unlimited, I don’t -- it’s not going to be a material shift in investment side. There’ll be some, but not material. It’s just a great addition to the portfolio. And this -- we’ve talked about it, it was important for us to accelerate. We think it’s good for broadband. It is helping broadband. We see the results in terms of churn and it’s just a growth engine for us, period. So really happy about the 278,000 lines, the most line additions in a quarter since we launched. It grew revenue 50%, achieved profitability. So, we’re focused across the board in terms of everything that we said we wanted to do. And this is one piece of it. So, focusing on every sales channel, and this is just going to be consistent with our approach. You’ll probably see a bit more packaging with broadband and mobile, but that’s not really different than anything that we’ve been talking about doing. So, it’s off -- it’s early with the unlimited stuff, but it’s -- we’re very encouraged. But, we like our complete suite of products that we have in the marketplace. Jeff Shell: Doug, this is Jeff. So, let me just take the opportunity with your question to maybe spend a minute or two on Peacock and just provide a little bit more granularity and how we’re doing more broadly than your question. So, first of all, we are very pleased with our steady growth on Peacock, and we’re particularly pleased that we chose this business model, which is an ad-supported AVOD model for the business. It was the right decision to pursue that clearly for our Company. Our revenue in that model is a mix of both, subscription revenue and ad revenue. And if you actually break down what drives the ad revenue in the future, it’s really four things we track. The first thing is sign-ups. I think, Brian mentioned in his opening that we reached 42 million sign-ups. This is up 9 million from last quarter. And we’re very pleased not just with that growth, but with a steady growth in that over time as we’ve added things. The second metric is how many of those people who sign up, use the service on a regular basis. We internally use a metric known as MAAs, which I think others in the industry also use, monthly active accounts, that’s how many households actually use it monthly. It’s either -- to be granular, it’s either somebody who pays a household, pays a great subscription fee or somebody who uses it monthly. And by that basis, roughly a third of our sign-ups are by our metrics MAAs. And that -- put that in the context. That is about a third of where Hulu is today. We’ve only been national for less than a year, Hulu’s been 13 years. So, we’re very pleased with how that’s grown steadily. And MAA is the way we track them actually kind of understate the engagement, because there are many people who use it, but just not enough to be an MAA. If you actually made it quarterly assumption, then we’d be up to another $10 million above that number. So, one of the upsides for us is converting those non-MAA sign-ups to MAAs, which we think we’ll do over time. The third metric is usage, which is very strong, double our projections. And to put that in context, the -- an average Peacock MAA is using Peacock more than an average TV viewer is watching NBC. So, we’re very pleased with that. And then finally, how do we monetize those users and usage is the CPM, which gets to your question. We set out, as you mentioned, in the sponsorship model. So, the vast majority of our revenue coming out was set up by 10 charter advertisers. But, we actually are exceeding the guarantees that we made to those advertisers. So, we are already, even this quarter, selling some of the excess inventory on a spot basis. And we’re achieving CPMs that are equal or in some cases, above what we’re getting on NBC Prime, which is our gold standard. That’s very encouraging. And to answer your question, in Q4 of this year, that’s when the sponsorship deals roll off and we start selling all of our inventory on a spot basis, but we’re in early stages of the upfront right now. So, we’re already starting to talk to advertisers about making upfront commitments that include Peacock. Let me just mention one other thing. All of this success is without most of the programming that we anticipated. We anticipated launching with the Olympics. We have not had -- we have two Olympics in the next seven months. We’re going to do some pretty exciting things on Peacock with our Olympics programming. And then, even though we’re back in production, as Mike mentioned or Brian mentioned on 30 shows right now, most of those have not hit Peacock yet. So, the strength of our original programming that we have planned to launch with is really coming in future quarters. So, very encouraged by Peacock going forward, very steady growth so far, and we’re confident about the future. Operator: Your next question comes from the line of Ben Swinburne with Morgan Stanley. Ben Swinburne: One on Cable, one on Sky. Maybe for Dave, or Dave and Brian. Thank you for the comments in the prepared remarks on the network. As you know, there’s a lot of focus on symmetric offers, particularly in Washington. And I’m just wondering, from a business point of view, do you think there’s real demand there? And what kind of timeline should we be thinking about in terms of adding that capability or more of that capability to your network? And can you talk a little bit about what that might mean for capital intensity, which I’m sure is what most investors are focused on. And then, for Dana, there’s been an unbelievable amount of kind of tectonic shifts in the European sports landscape just this year. And you mentioned Sky, you have Serie A. Can you just put all this in context, when you look at the Bundesliga deal, what we’re reading about with EPL, Serie A. Is this helpful to Sky hitting its EBITDA targets of doubling over time, or is this a headwind? Can you maybe just -- because these are obviously massive contracts. Could you just talk a little bit about the soccer background? That would be great for all of us. Thank you. Brian Roberts: Dave, why don’t you talk a little bit about symmetrical? Dave Watson: Sure. Hi, Ben. So, this is a focus for us over the next several years. But overall, our approach, our strategy is to continue to enhance broadband completely. And that you want to have the best overall speeds in the marketplace that go from the house of the business, great WiFi coverage within where people are, control streaming, now mobile is part of the overall solution, and making it all seamless. So, it’s the overall experience that we’re focusing on. But, we continue to improve speeds along the way, we got 20 years in a row, we got constant increases in terms of speeds. And we address both, downstream and upstream. Let me put usage in perspective in terms of what we’ve seen pre-pandemic and most certainly through the pandemic where a network met the moment and then some. But putting usage in perspective, upstream is less than a tenth of downstream. And so, name the application, whether it’s video streaming, whether it’s gaming, host of education applications. Our network, I think, really stood up, as Brian talked about earlier. And so, while our competitors are spending heavily to try to catch up to us, we’ve already -- they’re testing, we’re not standing still. We’ve done 2 gigabits of download speed for testing, symmetrical 1 gig. And so, we have an architecture that I think is going to continue to put us in position to do it in an effective and a very efficient, capital-efficient way. So again, not standing still. So, we feel very good about the long-term architecture because of DOCSIS. DOCSIS 3.1 that we have is a very -- is a strong roadmap that we can deliver. And so, right now, as we sit here, we have 1.2 gigabits deployed throughout our entire footprint. We’ve increased the upstream speed. And so, over time, I think we can address symmetrical issues. But in the near term, the midterm, we are in a very good position. And I do not see an incremental need for upgrade in terms of capital. We constantly invest in the network. This is not something that just happened overnight. We invest all the time and we’re making our infrastructure more efficient as we virtualize things like CMTSs, and we’re just taking cost out of how we deliver this, couple that with the great DOCSIS standard. I think, we’re in a pretty good position. So, broadband, commercial and residential is growing. It’s a great business. We’re going to continue to strengthen our lead position. And I think it’s going to continue to be a great return on investment for us. And we decide to accelerate our plans. Our CapEx intensity might be a little bit higher one year versus the other. But, we’re still going to be in the ballpark of what we’ve been doing. And it’s just not going to be uptick by a material amount. So, I feel very good about our position, and I really like our long-term roadmap. Dana Strong: And Ben, this is Dana. Good morning. And thanks very much for your question. There has certainly been a lot of noise around sport and football in Europe over the past four or six weeks. But if you put it all into context, what I would say is that Sky has had a very good track record of renewing sports rights, and we’re generally feeling good that that track record will continue. With English Premier League at the last renewal, we made a deliberate choice to reduce our investment by 15%, but we still secured an improved set of rights. In Bundesliga, for the upcoming season, we continue to hold all of the rights to the very best games, but we weren’t able to secure a discount to our previous contract. And with Serie A, I think it just demonstrates that we will walk away when we feel the economics don’t work. I think, more importantly and to broaden the periscope a bit, I would underscore that Sky has been on a journey for over 15 years to really expand our value proposition beyond sport. And that’s worked extraordinarily well. And I think it comes through in the performance of the business, the fundamentals are in the right place. Our customers are taking more products and services. Our viewing is up significantly on Sky channels. Our churn is significantly lower. Sky streaming is growing considerably. And the aggregation platform is really working, as Brian mentioned, with two-thirds customers in the UK. So, I think we feel very, very comfortable that the business fundamentals are very well-positioned across all of our markets. We really like the position that we’re in, and we feel confident we can continue to build and grow on these fundamentals. So, I think the core of your question is to remain confident in our ambition to double the EBITDA over the next several years. And I would say, yes, we do remain confident in that ambition. And I would say that’s based on confidence in a range of factors. Strong bounce back that we’re already seeing after the effects of COVID, our ability to continue to use the retail engine to drive the customer base and reduce churn through aggregation, and our strategy for multiservice bundles, a very good disciplined cost focus. The team is executing very well. Secure content supply and then really a diversification of that to our expansion into originals and exclusives has worked very well. And we still see a lot of strength in the UK growth opportunities. So, all of that gives me a lot of confidence to say we’re on track for our ambition of doubling EBITDA over the next several years. Thanks. Operator: Your next question comes from the line of Phil Cusick with JP Morgan. Please go ahead. Phil Cusick: Hey, guys. Thanks. I guess a couple of follow-ups here. Brian, as Ben said, thanks for the detail on broadband, and clearly, it’s not just about speed. It’s interesting that when the market is worried about competition, you guys are raising the bar on yourself for ads. What’s the mix of drivers that you see between strong market growth and share shifting? And then second, on mobile, it looks like you’re hiring a lot of people in that business, probably getting ready for a network build. Can you expand on where that network effort is headed? Thanks. Brian Roberts: So, let me start. Dave, why don’t you also feel free to jump in on -- I think Dave gave pretty complete answers on broadband. We do believe that by having the best product, and I think we have that, you’re in the enviable position. And so, we balance constantly looking at new technologies where competitors might be coming over the last, I don’t know, 15 years. We’ve had lots and lots of fiber competition. We’ve had lots of overbuild competition, DSL competition, we’ve added 20 million broadband, it’s an -- over a consistent period of time. And so, I think we know how to compete. We go from market share, and we do that while we’re able to increase the EBITDA and free cash flow from the business. We really focused on the business sector, haven’t talked a lot about that today. They had a great quarter and real momentum as all businesses are reopening. People are rethinking their relationships. And we have the latest, greatest, best technology. And you’ll be hearing a lot, or I think, from our business services unit. In wireless, just to add to all the points Dave made about our focus on mobile, while, yes, we bought some spectrum and we’ll be doing some trials to see how we can offload, and that really will prove to be a cost savings. If we get it right. In dense areas, that whole relationship requires a healthy partnership with a wireless MNO. And in the case of Verizon, we’re really pleased with the partnership restructured it so that we’re able to make these unlimited offerings in a way that continues our profitability March and real value for consumers, and in a way that Verizon is happy that their network is getting used. So, good work to our team that worked hard, and to Verizon’s team who are bringing great offerings to the market with expanding mobile. So, net-net, I think both of those important two products and we now bundle them together, put us in a position to continue to grow and be able to compete with where the world evolves itself. Operator: Your next question will come from the line of Craig Moffett with MoffettNathanson. Please go ahead. Craig Moffett: Yes. Hi. A question for Dave, if I could - -two actually. First, can you talk about how your Cable segment is preparing for federal stimulus? And how you think that -- what impact that’s likely to have on your business? Can you quantify at all what you expect to come from stimulus, including how many essentials customers you have and whether you expect those customers to now generate higher ARPU under the stimulus plan? And then on the wireless business, I just want to drill down on a question that was asked before. With the new pricing, do you think that you can still be EBITDA positive in that business, even with the new pricing, which presumably will mean at least somewhat lower ARPU going forward? Dave Watson: Thank you, Craig. So, first, on stimulus. There probably will be some non-pay benefit and we -- and there are a couple of different ways that could play out, but our voluntary churn and non-pay churn have been consistently been running low for the past year and been trending lower pre-pandemic. So, our earlier churn performance was regardless of when stimulus checks were received, but could be some -- a little bit of additional support around that. But, I think, you have to look at the longer term trends. Our performance overall reflects what we’ve been talking about. We’re building a great network and improving the products constantly. So, I think, there could be just a little bit of non-pay support, but again, we’re already doing fairly well there. In regards to wireless, I think, in terms of EBITDA, the new pricing, yes. The way that we think about this, it’s a long-term growth opportunity. Certainly, for broadband, we’ve talked about it. But, when you look at the overall marketplace, you feel -- we feel good about that we’re -- we have a little over 3 million lines, less than 2 million customer relationships, mobile relationships out of a pool of 33 million customer relationships. So, low penetration, lots of runway. So, we always -- and take a look at any of our approaches to key categories. We take a very-disciplined approach towards packaging and improving value. And so, yes, we feel very good about unlimited as part of the portfolio and not changing the strategy or materially the results in terms of ARPU and mobile and the impact towards EBITDA. So, overall, again, Brian mentioned it, we really appreciate, and the Verizon relationship, it’s important for us. And I think we’re good for them, very good for them. And it’s -- so it’s a good win-win for us to be able to add this new set of unlimited to already strong portfolio. So, feel good about our ability to continue to drive healthy EBITDA with it. Operator: Your next question will come from the line of John Hodulik with UBS. Please go ahead. John Hodulik: A couple of follow-ups for Jeff. Jeff, lots of news in terms of sports rights in the U.S. as well, with you guys adding WWE and the NFL deal and not renewing NHL and the shutdown of the NBC Sports net. So, can you talk about your strategy going forward? And maybe what were some of the drivers of those decisions? And then, also back to Peacock, the big B2C platforms are obviously spending sort of multiples of what Peacock is on content. And what I realize those are fundamentally different services. Should we expect the strategy to evolve over time with potentially further investment to capture growth and engagement, or do you guys think you guys are fully capturing the opportunity at current levels? Thanks. Jeff Shell: Yes. Thanks, John. Let me take them in order. So first of all, we’re really thrilled to continue our NFL relationship. That was an important one for us. The NFL really kind of encompasses what we want in sports rights. It is obviously very important for our traditional business, number one show in prime time for over a decade and with our Al and Cris, and now Drew Brees and Mike Tirico and our talent, we’re -- that is a very important tent-pole for our existing business. At the same time, as the business evolves and moves to streaming and on demand, that deal also gave us a lot of content that now we can use on Peacock and our other platforms, whether it’s simulcast of games and exclusive games or additional rights to show highlights and other footage. It’s really the perfect deal with the premier sports in the U.S. So, that really is kind of our model. The Olympics is the same thing where we have rights to use content across multiple platforms; same thing with golf, which is an important tent-pole for us. And we’ll continue to be aggressive and look for sports that not only we can get for a price that we think we can get a return on, but also properties where we can drive usage, both linear and digital. And WWE is kind of the perfect one on that, where we were able to take a franchise that was already important to us on USA and our linear networks and extended across in the Peacock in a way that’s been very successful. So, we’re thrilled with our portfolio now. We’ll continue to be opportunistic we find opportunities that match all those things. Turning to Peacock spending. I think, it’s important to recognize that we really have -- and Mark Lazarus has laid this out pretty well. We want to build our television business to match what consumers are doing. Consumers are watching content across a variety of different platforms, not just linear, not just streaming, but lots of different ways. And our spending really should be looked at in that context, not just what we’re discretely spending on Peacock, but what we’re spending across our whole portfolio. And when you look at that, we match up pretty well versus our competitors. And with Peacock, we actually don’t -- as I mentioned earlier, we don’t even have the benefit of most of the spending that we had planned because of the production delays with COVID. So, at the moment, we’re pretty pleased with the content we have on Peacock and the content that’s coming in future days. And as I said before, with the success of Peacock, and I think Brian mentioned this in opening, we have a lot of options going forward, and we’ll continue to watch the way the world changes and how our product evolves, and we’ll evaluate those options. Marci Ryvicker: Thanks, John. Regina, we have time for one last question. Operator: Our final question comes from the line of Michael Rollins with Citi. Please go ahead. Michael Rollins: I was curious if you could share how much of the programming spend within NBCU is exclusive to your platform, whether created by the studio, live sports, news? And where do you see that mix going over the next few years, especially as you look to expand the reach of the Peacock platform? Thanks. Brian Roberts: Yes. Thanks. I would say, virtually, all of our programming, the vast majority of our programming is exclusive. The exclusivity of programming is very, very important to us. And it’s not just the traditional exclusivity, whether it’s an S&L or a drama, but it’s the exclusivity of a Rachel Maddow every night on MSNBC or exclusivity of our various sports properties, most notably the Olympics. So, exclusivity is critical when you look at programming, not just in NBC, but across some of the new digital platforms, too. I don’t know if that answers your question, but virtually, all of our programming. Marci Ryvicker: Thanks, Mike. And I just want to thank all of you for joining us on our first quarter 2021 earnings call. We hope you all continue to stay healthy and safe. Operator: There will be a replay available of today’s call starting at 12 o’clock p.m. Eastern Time. It will run through Thursday, May 6th, at midnight Eastern Time. A dial-in number is 855-859-2056, and the conference ID number is 5168008. A recording of the conference call will also be available on the Company’s website, beginning at 12:30 p.m. Eastern Time today. This concludes today’s teleconference. Thank you for participating. You may all disconnect.CMCSA Ratings Summary
CMCSA Quant Ranking
Related Analysis
Comcast Corporation Reports Q2 Beat, But Weak Subscriber Growth, Shares Down 13%
Comcast Corporation (NASDAQ:CMCSA) shares dropped more than 13% since the company’s reported Q2 results last week. While EPS of $1.01 and revenue of $30.02 billion came in better than the Street estimates of $0.92 and $29.89 billion, respectively, subscriber growth was weak with a shocking flat broadband-subscriber number.
Subscriber losses across the board were effectively offset by unsustainable growth in video and broadband ARPU of 7.5% year-over-year and 3.7% year-over-year, respectively.
According to the analyst at Oppenheimer, the company is stuck in a negative feedback loop of raising prices to combat subscriber churn while underinvesting in its networks. The analysts believe that the strategy of raising prices and free cash flow while losing subscribers is long-term value-destructive but short-term attractive.
Comcast Shares Down 10% in the Last Two Days Despite Q1 Beat
Comcast Corporation (NASDAQ:CMCSA) shares lost more than 10% lower since Wednesday's close, despite the company’s reported Q1 beat, with EPS of $0.86 coming in above the consensus estimate of $0.81. Revenue was $31 billion, compared to the consensus of $30.54 billion.
Analysts at Oppenheimer shared their views on the company’s quarterly results, stating that secular pressure is beginning to impact the core business.
Broadband net adds were a normalized 180,000, down from 538,000 in Q1/20. Video/voice customer net losses of 512,000/283,000, respectively, were substantially worse than Oppenheimer’s estimates of 460,000/150,000 and last year's 248,000/24,000 declines. Price increases, which the analysts see as a negative strategy long term, did drive Cable revenue growth of 4.7% year-over-year to $16.54 billion, beating Oppenheimer’s estimate of $16.34 billion.
Advertising and Wireless remained robust entering 2022. The company added 318,000 wireless lines, the second consecutive record quarterly result, fueling Wireless revenue growth of 32% year-over-year.
