Amid the coronavirus pandemic, Comcast has depended heavily on its cable and broadband services. Now the entertainment giant is putting new hope into its entertainment operations.
Executives are placing new hopes in both the company’s theme parks and Peacock streaming-video hub, they indicated Thursday during a conference call with investors. “We can see first-hand the pent up demand” for family activity outside the home, said Comcast CEO Brian Roberts, predicting that dynamic would boost the company’s movie business as well as visits to its theme parks.
Like other media companies, Comcast is grappling with extreme disruption in its operations. Much of it has been stirred by the pandemic, but the companies are also dealing with continued migration by audiences from linear viewing to streaming video, a change that has significant effects on ratings, advertising and more. Comcast is benefitting from some of the trends, but the long-term effects on its more traditional businesses are likely to be destabilizing
The company is encouraged by recent demand for Peacock, which executives said had notched 42 million sign-ups in total, though the company didn’t specify how many paid subscriptions had resulted, or how many of the Peacock customers were attracted by free offers for Peacock given to subscribers of Comcast products. Roberts said the company has noticed increasing usage by customers and sees a chance to charge premium rates for advertising. A series of early deals Comcast struck with specific advertisers are due to lapse in the fourth quarter, which could make more Peacock ad inventory available for the company’s general customer base.
The sketches of where the company may focus in the future come as it enjoys higher first-quarter profit buoyed in large part by its large cable operation. Net income in the quarter rose significantly, largely due to increases in business at its cable and Sky operations, while its NBCUniversal business continued to recover from the results of the coronavirus pandemic.
The Philadelphia media giant said first quarter profit rose 55% to $3.33 billion, or 71 cents a share, compared with$2.1 billion, or $4.6 billion in the year-earlier period. Revenue rose 2.2% to $27.2 billion from $26.6 billion in the year-earlier period, largely on new broadband and wireless subscriptions at its large cable business and improvements at its European Sky unit. Overall, Comcast said it had added 461,000 new high-speed internet customers.
But the company also faced challenges. Revenue fell at NBCUniversal as the company’s theme-park business remained crimped by pandemic protocols and advertising declined. Comcast said its Peacock streaming-video hub had notched 42 million sign-ups in total, though it didn’t specify how many paid subscriptions had resulted, or how many of the Peacock customers were attracted by free offers for Peacock given to subscribers of Comcast products.
Revenue at the company’s U.S. cable operations rose 6% to $15.81 billion. In addition to the broadband boost, Comcast saw increased demand for its cellphone service, which attracted 278,000 new customers during the period. Even so, the company continues to face defections in its traditional video business. Comcast said it lost 491,000 subscribers from its mainstay pay-TV operations in the first quarter.
Revenue at Sky rose 2% to about $5 billion. The company said the European unit added 221,000 customers.
NBCUniversal faced headwinds, as it has for the past year amid coronavirus. Revenue fell 9% to $7.02 billion, with a decline of 33% at its Universal theme parks and a dip of 0.6% at its film and TV studios. Meanwhile, revenue from the company’s media properties rose 3.2% to $5 billion, largely due to higher distribution revenue. Executives sketched out a second quarter that had significant movie releases and more sports events, which they expect will boost revenue streams, including advertising.