Comcast topped Wall Street expectations for the first quarter, pumped up by a 21.3% jump in revenue at NBCUniversal thanks to a big boost from the 2018 Winter Olympic Games and the NFL’s Super Bowl.
The media conglomerate posted total revenue of $22.8 billion, up 10%, and net income of $3.1 billion, an increase of 21.2%. Comcast’s adjusted earnings per share of 62 cents topped the Street’s estimate of 59 cents.
Also Wednesday, Comcast announced a formal $31 billion offer for U.K. satcaster Sky, looking to outbid 21st Century Fox for the European pay-TV player. Comcast shares fell 2.9% in premarket trading on the Q1 report and Sky announcement.
According to Comcast, the combination of the 2018 PyeongChang Olympics and Super Bowl LII generated an incremental $1.6 billion in revenue at its TV businesses. NBCU’s strong Q1 results on the TV side offset a 16% revenue decline at Universal Pictures.
“NBCUniversal delivered double-digit EBITDA growth, fueled by impressive results at our theme parks, as well as our TV businesses’ successful broadcasts of the NFL’s Super Bowl LII and the 2018 PyeongChang Olympics,” Brian Roberts, chairman and CEO of Comcast, said in announcing the results.
Comcast’s cable business grew a more modest 3.6%, to $13.5 billion in the quarter, driven by broadband internet and business services. It lost 93,000 residential video customers in Q1, to stand at 21.21 million nationwide, and gained 351,000 broadband subs to grow to 24.21 million total. Comcast said 61% of residential cable TV subs now have the X1 advanced set-top service.
NBCU’s $9.5 billion in Q1 2018 revenue reflected 21% growth in the cable networks group and a 58% increase from broadcast TV. Backing out $770 million from the Olympics and $423 million from Super Bowl, NBC’s broadcast TV revenue grew 4.3% in the period thanks to an 18% increase in retransmission revenue. That’s despite the fact that the 2018 Olympics were the least-watched to date, averaging 19.8 million viewers across multiple platforms over the 18-day event, while Super Bowl LII’s U.S. audience of 103.4 million was the lowest since 2009.
Universal Pictures revenue decreased 16.3%, to $1.6 billion in the first quarter of 2018, primarily reflecting 35% lower box-office revenue. The company said there were fewer films released in Q1 2018 — “Fifty Shades Freed,” “Pacific Rim Uprising,” “Darkest Hour” and “Pitch Perfect 3” — versus a year ago. Adjusted earnings fell 45.2%, to $203 million, reflecting the decline in revenue, partially offset by lower programming and production costs.
NBCU’s theme parks revenue increased 14.5% to $1.3 billion in the first quarter of 2018 due to higher per-capita spending. The company attributed the lift to the timing of spring holidays, as well as the continued success of Volcano Bay in Orlando, Minion Park in Japan and The Wizarding World of Harry Potter in Hollywood.