Revenue surges 55% to $15 billion in Q4

Comcast shares surged more than 5% Wednesday on major strides in transforming the core cable business, which lost surprisingly few video subscribers, and a pulse at NBC.

Chairman-CEO Brian Roberts said NBC drama “Smash” generated 20% higher ratings in Comcast cable markets than it did in the rest of the country at launch last week, showing synergy in play as it was marketed hard across all of the conglom’s platforms.

“Last week was critically important to the company,” Roberts said during a conference call to discuss fourth-quarter earnings. “Smash” and “The Voice” gave NBC a glimmer of ratings sunshine the day after the Super Bowl drew record auds to the network.

Net income for Philadelphia-based Comcast rose 26% to $1.29 billion from $1 billion a year earlier as gains in cable systems, cable networks and theme parks offset declines at Universal Pictures and the NBC network and stations.

Revenue of $15 billion surged 55% from $9.7 billion.

The board announced a hefty new $6.5 billion stock repurchase program, including $3 billion in buybacks slated for this year, and a big dividend hike.

Comcast is the nation’s largest MSO with about 23 million subscribers, and cable systems saw revenue rise 7% to $9.4 billion, including a 10% jump in high-speed Internet revenue and a 37% surge in business-services revenue, the two fastest-growing pieces. The cable biz lost only 17,000 TV customers for the quarter. It’s one of the lowest defection rates in years and suggests that some cable operators may be able to stop the erosion of video subs even in a fast-changing and competitive landscape.

Roberts, in fact, predicted that Comcast will eventually add video customers as it rolls out the Xfinity-branded service, inks deals with Microsoft’s Xbox 360 and electronics makers, migrates to the cloud and generally retools to follow changing consumer habits. “We are not yet back to full growth in video subscribers because there’s no growth in the housing market. But someday that will continue,” he said.

Cable system ad revenue fell 9.3%, reflecting lower political advertising.

Monthly average total revenue per video customer increased 7% to $141.24, reflecting a growing number of residential customers taking multiple products.

Net additions of combined video, high-speed Internet and voice customers increased by 465,000, or 12.3%.

NBCUniversal saw revenue nose higher by 0.8% to $5.7 billion. Operating cash flow fell 6.8% to $1.1 billion.

Broadcast revenue fell 3.7% to $1.8 billion, reflecting weakness at the NBC network and lower political advertising at local NBC stations as well as the impact of four fewer days in the advertising calendar.

The division swung to an operating cash loss of $80 million from positive cash flow of $55 million on lower revenue as well as higher marketing costs and a $28 million accounting hit.

But NBC’s “The Voice” and “Smash” drove the net to ratings victory the past two Monday nights for the first time in four years in the key 18-49 demo. Net, which has been on a long losing streak, remains challenged on other nights. NBCUniversal CEO Steve Burke said, however, that it may be on the move, more than a year after Comcast took control of NBCU through its joint venture with General Electric.

“The next one to three years (will see) the biggest upside,” Burke said on the call. “Last year was about integrating, making sure the right people were in place. As you look to 2012 and 2013, we will start to hopefully see some of the seeds we planted bear fruit. We think there’s real opportunity in broadcast.”

Total broadcast licensing rose by 23%, or $305 million, for the year to $1.62 billion mainly on July’s multiyear renewal of a deal with Netflix. For the quarter, licensing revenue rose to $429 million from $328 million.

In July, NBCU and Netflix announced a multiyear renewal of their licensing agreement making more shows and movies available for streaming.

Burke’s also keeping his fingers crossed for a turnaround at Universal Pictures, which has also experienced a long slump. Filmed entertainment revenue eased 1.8% to $1.3 billion. Operating cash flow plunged 49% to $89 million on lower revenue and higher marketing costs for 2012 releases. The studio’s upcoming slate includes “Dr. Seuss’ The Lorax,” “Battleship,” “American Reunion” and “The Bourne Legacy.”

Cable networks, on the contrary, “go from strength to strength” Burke said, and are the core of the entertainment business.

Revenue rose 5.3% to $2.2 billion on a 10.4% jump in distribution fees at the stable of 20 networks that includes USA and Syfy, Bravo, MSNBC and CNBC, E! and Oxygen.

Operating cash flow rose 15% to $923 million. Company cited lower programming expenses and lower production costs due to fewer NBA games, although the lockout also squeezed ad revenue, which rose 2%.

Theme parks revenue rose 4% to $498 million. Operating cash flow at the parks jumped 16% to $223 million.

Comcast said it bought back $491 million of shares for the quarter and $2.1 billion for the year. Including dividends that came to a $3.3 billion total return to shareholders in 2011.

Follow @Variety on Twitter for breaking news, reviews and more