Comcast’s NBCUniversal gains stand out as broadband keeps shrinking

Comcast’s latest quarter showed a company pulling in two directions: NBCUniversal grew with help from Peacock, sports and film, while the core broadband business kept losing subscribers. For everyday investors, the results offer an early look at why Comcast plans to separate its media and connectivity operations into two public companies.

The company said Thursday that Peacock, NBCUniversal’s streaming service, was profitable for the first time since its 2020 launch. Streaming profitability matters because many media companies have spent years taking losses to build subscriber bases, betting that scale would eventually turn those services into steady earners.

Peacock also added subscribers during the quarter, Comcast said, helped by live sports including the FIFA World Cup and the NBA postseason. The World Cup, which began in mid-June, also lifted Telemundo, where Comcast aired Spanish-language coverage in the U.S.

Media had the better quarter

Comcast’s content and experiences segment, which includes NBCUniversal’s TV, film and theme parks businesses, generated $10.73 billion in revenue. The company said revenue for the broader segment rose almost 23% from a year earlier.

Within that segment, Comcast said TV media benefited from Peacock and higher advertising revenue. The film studio business posted a 25% revenue increase. Theme parks revenue rose nearly 3%, as stronger results in Orlando outweighed weaker trends at international parks.

The gains come as Comcast prepares to split its media and broadband businesses into separate publicly traded companies. In the earnings release, co-CEOs Brian Roberts and Mike Cavanagh said the separation is intended to create two more focused businesses with the financial flexibility to pursue their own growth plans.

Broadband remains under pressure

The connectivity and platforms segment, which includes Xfinity broadband, mobile and cable TV, moved in the other direction. Revenue fell 3% to $19.8 billion, Comcast said.

Adjusted earnings before interest, taxes, depreciation and amortization, a profit measure often called EBITDA, declined nearly 6% to $7.96 billion in the segment. EBITDA strips out financing costs, taxes and certain noncash expenses, giving investors one view of operating performance.

Comcast lost 167,000 residential broadband customers during the quarter. It also shed 280,000 cable TV subscribers, continuing the long-running decline in traditional pay-TV bundles as households shift to streaming and other options.

The company said its updated broadband strategy is gaining traction after years of competition, including from 5G wireless home internet providers. That strategy includes lower-priced plans and promotions, which can help attract or retain customers but may weigh on revenue.

Mobile was the standout inside the connectivity business. Comcast said it had another record quarter for mobile additions, bringing its total to 10.2 million lines. Mobile has become a key part of the company’s effort to tie wireless service more closely to broadband packages.

Companywide results beat profit estimates

Across Comcast, second-quarter revenue fell 1.2% to $29.94 billion. On a pro forma basis, which adjusts results to reflect the Versant spinoff completed at the start of the year, Comcast said revenue rose 4.7%.

Adjusted earnings per share came in at $1.04. That was above the 97 cents analysts expected, according to LSEG.

Comcast shares were up about 1.5% in premarket trading Thursday after the report.

This story draws on original reporting from CNBC.