Comcast’s earnings results were bound to be unusual in Q3 which included the Brazil Olympics, its acquisition of DreamWorks Animation, and the public attention to the presidential election. And the company delivered with big swings in some units’ numbers but, when totaled, came in slightly ahead of the Street’s expectations.
The No. 1 cable company, and owner of NBCUniversal, generated net income of $2.24 billion, up 12.1% vs the period last year, on revenues of $21.31 billion, up 14.2%. That beat the consensus top line expectation for $21.16B.
Earnings at 92 cents a share beat analysts’ forecasts by a penny. Shares were up less than 1% in pre-market trading.
“The Rio Olympics were the most profitable and successful games in our history, and demonstrated our ability to deliver an unparalleled entertainment experience through NBCUniversal together with Comcast Cable and the X1 platform,” CEO Brian Roberts says. “NBCUniversal reported operating cash flow growth of over 30%, benefiting from the Olympics, continued growth at our Theme Parks, and the theatrical success of The Secret Life Of Pets this quarter.”
The NBCU’s Cable Networks revenues were up 22.0% to $2.94 billion, but that included $432 million for the Olympics. Without that, the top line would have increased 4.1% to $2.51 billion. Operating cash flow increased 7.0% to $893 million.
The nets lost subscribers, the company says. That was offset by a 27.3% increase in distribution revenue, and a 15.9% jump in ad sales.
The Broadcast Television unit’s revenues were up 56.6% to $3.09 billion — but would have fallen 3.6% to $1.90 billion without $1.2 billion from the Olympics. Operating cash flow was up 152% to $378 million.
Content licensing revenues fell in the quarter, the company says.
But the Games lifted ad sales by 92.4% and contributed — with rising retransmission consent fees — to a 77.5% jump in distribution revenues.
Universal’s Filmed Entertainment operation began to include DreamWorks Animation numbers on August 22 and was the laggard in Q3 with revenues down 7.9% to $1.79 billion and operating cash flow down 6.1% to $353 million.
Theatrical sales fell 21.1% as company couldn’t keep up with the pace it set last year with Jurassic World and Minions. Home entertainment also declined by 29.6%. But content licensing helped to balance things with a 19.8% increase which the company attributes to the timing of its offerings.
The period also included $50 million in severance costs for the DreamWorks acquisition.
At the Theme Parks unit the opening of Hollywood’s The Wizarding World Of Harry Potter worked some magic with the financial results as revenues increased 60.6% to $1.4 billion with operating cash flow up 62.4% to $706 million.
Comcast’s main show — its cable systems — more than held its own with video subscribers increasing by 32,000 to 22.4 million. This was the first time that increased in a Q3 in a decade.
All told, cable revenues were up 6.9% to $12.56 billion with operating cash flow up 5.5% to $4.99 billion.