Comcast Reports 1st Quarter 2022 Results

Comcast Corporation (NASDAQ: CMCSA) today reported results for the quarter ended March 31, 2022.

"2022 is off to a great start. For the first quarter we reported healthy growth in adjusted EBITDA and adjusted EPS, generated significant free cash flow, and increased our return of capital to shareholders. We also continued to make important organic investments and strategic decisions, highlighted by yesterday’s announcement of our new joint venture with Charter. This partnership demonstrates the benefits of our focus on innovation and enables us to bring entertainment aggregation and streaming products that run off our global technology platform to millions more customers. In cable, we are increasing the capacity of our broadband network and providing our customers with cutting-edge equipment that delivers the best in-home experience. Our media business is performing well, and the scale of our reach is underscored by our successful broadcast of the Super Bowl and the Olympics in the same week. These events were viewed by more than 200 million people in the U.S. across NBCUniversal’s platforms, including Peacock, which had an exceptional quarter. Our recovery from the pandemic at theme parks has been fantastic and shows no signs of slowing down. And, at Sky, we are pleased with our consistently strong results in the U.K. and continued improvement in Germany and Italy," commented Brian L. Roberts, Chairman and Chief Executive Officer of Comcast Corporation.

For additional detail on segment revenue and expenses, customer metrics, capital expenditures, and free cash flow, please refer to the trending schedules on Comcast’s Investor Relations website at www.cmcsa.com.

1st Quarter 2022 Highlights:

• Consolidated Adjusted EBITDA Increased 8.8% to $9.2 Billion; Adjusted EPS Increased 13.2% to $0.86; Generated Free Cash Flow of $4.8 Billion
• Returned $4.2 Billion to Shareholders Through a Combination of $1.2 Billion in Dividend Payments and $3.0 Billion in Share Repurchases
• Cable Communications Adjusted EBITDA Increased 6.5% and Adjusted EBITDA per Customer Relationship Increased 3.3%
• Cable Communications Total Customer Relationship Net Additions Were 194,000; Total Broadband Customer Net Additions Were 262,000 and Benefited From the Highest Level of Customer Retention on Record for Any Quarter
• Cable Communications Wireless Customer Line Net Additions Were 318,000, the Best Quarterly Result Since Launch in 2017
• NBCUniversal Adjusted EBITDA Increased 7.4% to $1.6 Billion, Including Peacock Losses
• Theme Parks Adjusted EBITDA Increased $512 Million to $451 Million, Reflecting Improved Results at Each Park Compared to the Prior Year Period and the Opening of Universal Beijing Resort in September 2021. Universal Orlando Generated Its Highest Adjusted EBITDA on Record for a First Quarter
• More Than 200 Million People in the U.S. Watched Either The NFL's Super Bowl or the 2022 Beijing Olympics on NBC, Peacock, and Our Other Platforms
• Sky Adjusted EBITDA Increased 71.0% to $622 Million; On a Constant Currency Basis, Adjusted EBITDA Increased 71.2%

Consolidated Financial Results

Revenue for the first quarter of 2022 increased 14.0% to $31.0 billion. Net Income Attributable to Comcast increased 6.6% to $3.5 billion. Adjusted Net Income increased 10.5% to $3.9 billion. Adjusted EBITDA increased 8.8% to $9.2 billion.

Earnings per Share (EPS) for the first quarter of 2022 was $0.78, an increase of 9.9% compared to the prior year period. Adjusted EPS increased 13.2% to $0.86.

Capital Expenditures of $1.9 billion in the first quarter of 2022 were consistent with the prior year period. Cable Communications’ capital expenditures of $1.4 billion were consistent with the prior year period. NBCUniversal’s capital expenditures increased 77.8% to $306 million. Sky's capital expenditures decreased 45.8% to $147 million.

Net Cash Provided by Operating Activities was $7.3 billion in the first quarter of 2022. Free Cash Flow was $4.8 billion.

Dividends and Share Repurchases. Comcast resumed its share repurchase program in May 2021 after pausing the program in 2019 to accelerate the reduction of indebtedness it incurred in connection with its acquisition of Sky. During the first quarter of 2022, Comcast paid dividends totaling $1.2 billion and repurchased 62.5 million of its common shares for $3.0 billion, resulting in a total return of capital to shareholders of $4.2 billion, compared to $1.1 billion in the prior year period.

Cable Communications

Revenue for Cable Communications increased 4.7% to $16.5 billion in the first quarter of 2022, driven by increases in broadband, business services, wireless, advertising, and other revenue, partially offset by decreases in video and voice revenue. Broadband revenue increased 8.0% due to an increase in the number of residential broadband customers and an increase in average rates. Business services revenue increased 10.6% due to an increase in average rates, an increase in the number of customers receiving our services, and from a recent acquisition. Wireless revenue increased 32.0%, primarily due to an increase in the number of customer lines. Advertising revenue increased 8.6%, primarily driven by increases in political advertising and advertising at our Xumo streaming service, as well as at our advanced advertising businesses. Excluding political advertising revenue, advertising revenue increased 6.0%. Other revenue increased 2.7%, primarily reflecting increases in revenue from licensing of our technology platforms and from our security and automation services. Video revenue decreased 1.5%, reflecting a decrease in the number of residential video customers, partially offset by an increase in average rates. Voice revenue decreased 9.8%, primarily reflecting a decrease in the number of residential voice customers.

Total Customer Relationships increased by 194,000 to 34.4 million in the first quarter of 2022. Residential customer relationships increased by 185,000 and business customer relationships increased by 9,000. Total broadband customer net additions were 262,000, total video customer net losses were 512,000, and total voice customer net losses were 282,000. In addition, Cable Communications added 318,000 wireless lines in the quarter.

Adjusted EBITDA for Cable Communications increased 6.5% to $7.3 billion in the first quarter of 2022, reflecting higher revenue, partially offset by a 3.3% increase in operating expenses. In the first quarter of 2022, programming costs decreased 1.1%, reflecting a decline in the number of video subscribers, partially offset by the timing of contract renewals. Non-programming expenses increased 6.3%, primarily reflecting higher technical and product support expenses, other expenses, and advertising, marketing and promotion expenses, partially offset by lower franchise and regulatory fees and customer service expenses. Non-programming expenses per customer relationship increased 3.2%. Adjusted EBITDA per customer relationship increased 3.3%, and Adjusted EBITDA margin was 44.0% compared to 43.2% in the prior year period.

Capital Expenditures for Cable Communications of $1.4 billion in the first quarter of 2022 were consistent with the prior year period, primarily reflecting increased investment in support capital, partially offset by decreased investment in customer premise equipment and line extensions. Cable capital expenditures represented 8.3% of Cable revenue in the first quarter of 2022 compared to 8.7% in the prior year period.

NBCUniversal

Revenue for NBCUniversal increased 46.6% to $10.3 billion in the first quarter of 2022, including $1.5 billion of incremental revenue from the 2022 Beijing Olympics and the NFL's Super Bowl included in the Media segment. Adjusted EBITDA increased 7.4% to $1.6 billion.

Media

Media revenue increased 36.3% to $6.9 billion in the first quarter of 2022, primarily reflecting higher advertising revenue and distribution revenue. Excluding $963 million of revenue generated by the broadcast of the 2022 Beijing Olympics and $519 million of revenue generated by the broadcast of the NFL's Super Bowl, Media revenue increased 6.9%⁵. Advertising revenue increased 59.2%, driven by the broadcasts of the 2022 Beijing Olympics and the NFL's Super Bowl, and additional Peacock sales. Distribution revenue increased 21.6%, reflecting the broadcast of the 2022 Beijing Olympics, increases at Peacock, as well as contractual rate increases, partially offset by a decline in subscribers at our networks. Adjusted EBITDA decreased 21.3% to $1.2 billion in the first quarter of 2022, reflecting higher operating expenses, which more than offset higher revenue. The increase in operating expenses was primarily driven by higher programming and production expenses, reflecting higher sports programming costs associated with the broadcasts of 2022 Beijing Olympics and the NFL's Super Bowl, as well as higher programming costs at Peacock. Media results include $472 million of revenue and an Adjusted EBITDA⁶ loss of $456 million related to Peacock, including amounts attributable to the 2022 Beijing Olympics and the NFL's Super Bowl, compared to $91 million of revenue and an Adjusted EBITDA⁶ loss of $277 million in the prior year period.

Studios

Studios revenue increased 15.1% to $2.8 billion in the first quarter of 2022, primarily reflecting higher content licensing revenue and theatrical revenue. Content licensing revenue increased 9.8%, driven by film and television content licensing, and reflects the comparison to the same period last year which included a new licensing agreement for content that became exclusively available for streaming on Peacock. Theatrical revenue increased $129 million to $168 million, primarily driven by the recent release, Sing 2, and a favorable comparison to the prior year period, which was adversely impacted by theater closures and theaters operating at reduced capacity due to COVID-19. Adjusted EBITDA decreased 50.7% to $245 million in the first quarter of 2022, reflecting higher operating expenses, which more than offset higher revenue, including the comparison to the licensing agreement for content on Peacock in the prior year period. The increase in operating expenses was driven by higher programming and production expenses, reflecting higher amortization of television and film production costs in the current year period and compared to the prior year period when production was impacted due to COVID-19, as well as an increase in advertising, marketing and promotion expenses ahead of upcoming film releases.

Theme Parks

Theme Parks revenue increased $941 million to $1.6 billion in the first quarter of 2022, reflecting improved operating conditions compared to the prior year period, when each of our theme parks in the U.S. and Japan was either operating at limited capacity or closed as a result of COVID-19, and also the opening of Universal Beijing Resort in September 2021. Theme Parks Adjusted EBITDA was $451 million in the first quarter of 2022, compared to a loss of $61 million in the prior year period.

Headquarters and Other

NBCUniversal Headquarters and Other includes overhead, personnel costs and costs associated with corporate initiatives. Headquarters and Other Adjusted EBITDA loss in the first quarter of 2022 was $191 million, compared to a loss of $209 million in the prior year period.

Eliminations

Amounts represent eliminations of transactions between our NBCUniversal segments, which are affected by the timing of recognition of content licenses between our Studios and Media segments. Revenue eliminations in the first quarter of 2022 were $901 million, compared to $1.0 billion in the prior year period, and Adjusted EBITDA eliminations were a loss of $62 million, compared to a loss of $210 million in the prior year period. The year-over-year changes were primarily driven by the licensing of content by the Studios segment to Peacock in the Media segment.

Sky

Revenue for Sky decreased 4.5% to $4.8 billion in the first quarter of 2022. Excluding the impact of currency, revenue was consistent with the prior year period, reflecting lower content revenue, higher advertising revenue, and consistent direct-to-consumer revenue. Content revenue decreased 14.3% to $295 million due to a change in sports programming licensing agreements in Italy and Germany. Advertising revenue increased 7.9% to $596 million, primarily reflecting higher advertising revenue in the U.K. due to an overall market improvement compared to the prior year period, partially offset by lower advertising revenue in Italy due to the negative impact of the reduction in Sky's broadcast rights to Serie A. Direct-to-consumer revenue of $3.9 billion was consistent with the prior year period, primarily reflecting increases in average revenue per customer relationship and customer relationships in the U.K., offset by a decrease in customer relationships and average revenue per relationship in Italy which included the impact of the reduction in Sky's broadcast rights to Serie A.

Total Customer Relationships decreased by 106,000 to 22.9 million in the first quarter of 2022, reflecting a decrease in customer relationships in Italy, partially offset by an increase in customer relationships in the U.K. and Germany.

Adjusted EBITDA for Sky increased 71.0% to $622 million in the first quarter of 2022. Excluding the impact of currency, Adjusted EBITDA increased 71.2% compared to the prior year period, primarily reflecting lower operating expenses. The decrease in operating expenses was due to lower programming and production expenses, primarily reflecting resets in our sports rights in Italy and Germany.

Corporate, Other and Eliminations

Corporate and Other

Corporate and Other primarily relates to corporate operations, Comcast Spectacor, and our new smart TV initiatives, Sky Glass and XClass TV. Revenue in the first quarter of 2022 was $238 million compared to $89 million in the prior year period. Corporate and Other Adjusted EBITDA loss was $262 million, including losses from Sky Glass and XClass TV during the period, compared to a loss of $281 million in the prior year period which reflected the impact of COVID-19 on Spectacor operations.

Eliminations

Amounts represent eliminations of transactions between Cable Communications, NBCUniversal, Sky and other businesses. Eliminations of transactions between NBCUniversal segments are presented separately. Revenue eliminations in the first quarter of 2022 were $840 million compared to $710 million in the prior year period, and Adjusted EBITDA eliminations were a loss of $82 million compared to a benefit of $10 million in the prior year period. Current year amounts reflect an increase in eliminations associated with the 2022 Beijing Olympics.

Conference Call and Other Information

Comcast Corporation will host a conference call with the financial community today, April 28, 2022 at 8:30 a.m. Eastern Time (ET). The conference call and related materials will be broadcast live and posted on our Investor Relations website at www.cmcsa.com. Those parties interested in participating via telephone should dial (833) 618-9487. A replay of the call will be available starting at 12:00 p.m. ET on Thursday, April 28, 2022 on the Investor Relations website or by telephone. To access the telephone replay, which will be available until Thursday, May 5, 2022 at midnight ET, please dial (855) 859-2056 and enter the conference ID number 5683886.

From time to time, we post information that may be of interest to investors on our website at www.cmcsa.com and on our corporate website, www.comcastcorporation.com. To automatically receive Comcast financial news by email, please visit www.cmcsa.com and subscribe to email alerts.

Caution Concerning Forward-Looking Statements

This press release includes statements that may constitute forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made, and involve risks and uncertainties that could cause actual events or our actual results to differ materially from those expressed in any such forward-looking statements. In evaluating these statements, readers should consider various factors, including the risks and uncertainties we describe in the “Risk Factors” sections of our most recent Annual Report on Form 10-K, our most recent Quarterly Report on Form 10-Q and other reports filed with the Securities and Exchange Commission (SEC). We undertake no obligation to update or revise publicly any forward-looking statements, whether because of new information, future events or otherwise.

Non-GAAP Financial Measures

In this discussion, we sometimes refer to financial measures that are not presented according to generally accepted accounting principles in the U.S. (GAAP). Certain of these measures are considered “non-GAAP financial measures” under the SEC regulations; those rules require the supplemental explanations and reconciliations that are in Comcast’s Form 8-K (Quarterly Earnings Release) furnished to the SEC.

About Comcast Corporation

Comcast Corporation (Nasdaq: CMCSA) is a global media and technology company that connects people to moments that matter. We are principally focused on connectivity, aggregation, and streaming with 57 million customer relationships across the United States and Europe. We deliver broadband, wireless, and video through our Xfinity, Comcast Business, and Sky brands; create, distribute, and stream leading entertainment, sports, and news through Universal Filmed Entertainment Group, Universal Studio Group, Sky Studios, the NBC and Telemundo broadcast networks, multiple cable networks, Peacock, NBCUniversal News Group, NBC Sports, Sky News, and Sky Sports; and provide memorable experiences at Universal Parks and Resorts in the United States and Asia.

Visit www.comcastcorporation.com for more information.

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