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Comcast Would Be Interested in Buying Hulu From Disney ‘If It Was Up for Sale,’ CEO Brian Roberts Says

Brian Roberts Comcast
Courtesy of Comcast

Is there a bidding war brewing over Hulu — or is Brian Roberts trolling Disney?

The Comcast chairman and CEO called Hulu a “phenomenal business” — and said that if Disney were willing to sell it, the cable and media giant would be interested in buying it out.

“Hulu’s a phenomenal business. Its scale is fantastic. It has wonderful content,” Roberts said, speaking Wednesday at Goldman Sachs’ Communacopia + Technology Conference 2022 in San Francisco. “If it was up for sale, Comcast would be interested” in buying 100% of Hulu, and “others would I think as well.”

Roberts was asked about Disney CEO Bob Chapek’s recent comments, in an interview with the FT, that when Comcast and Disney inked their deal in May 2019 giving Disney control of Hulu, investors were more bullish on streaming services — and that enthusiasm for the business has waned in the three years since. “I would take great exception to that,” Roberts said.

Disney currently owns 66% of Hulu and Comcast holds the remaining 33% stake. As of July 2, 2022, Disney recorded Comcast’s interest in Hulu as being worth $8.6 billion, implying a valuation of $25.8 billion. In an auction-style sale of Hulu in its entirety, Roberts suggested, Hulu may fetch more than that.

Roberts’ comments about Hulu look like a bargaining ploy. After all, he has an interest in maximizing Hulu’s value in the event Comcast ultimately sells its stake.

Under the agreement that gave Disney operational control over Hulu, Comcast in January 2024 has the right to require Disney to buy its Hulu ownership stake (and conversely, Disney has the right to force Comcast to sell it).

But it’s Disney’s decision whether it wants to sell its position in Hulu — and earlier Wednesday at the Communacopia conference, Chapek signaled again that his company wants to own 100% of Hulu for itself. “We’d love to get to that end point earlier,” Chapek said, citing the January 2024 trigger, but he indicated that Disney in its talks with Comcast has not settled on terms for such a deal.

Hulu, which is available only in the U.S., gained 600,000 paid subscribers in the June quarter to reach 46.2 million total. That includes 4.0 million live-TV customers, flat with the prior quarter.

Snapping up Hulu — and combining it with Peacock — would certainly give Comcast a more powerful play in the streaming wars.

In the second quarter, Peacock’s paid customer based was flat at 13 million and overall monthly active accounts dropped by 1 million, to 27 million. In Q1, Peacock had featured high-profile events including the Super Bowl and the Beijing Winter Olympics. Peacock revenue for Q2 was $916 million (up from $122 million a year prior) while operating costs and expenses for the streamer were $912 million (versus $485 million in Q2 2021).

Roberts said he was “really happy with how Peacock has done in the last two years,” and said the streamer has increased the amount of content from 20,000 initially to 70,000 hours.

For Q2, Comcast’s overall revenue rose 5.1% to $30.0 billion compared with $28.5 billion in the year-earlier period. NBCUniversal provided a boost to topline growth, as revenue jumped 18.7% to $9.45 billion.

Comcast’s cable business shed 521,000 total video customers in Q2 to stand at 17.1 million at the end of June, while total broadband customers of 32.2 million were flat compared with the first quarter of 2022.

Asked about the broadband slowdown, Roberts said that Comcast had gained 3 million customers during the COVID pandemic, so there was some “pull forward” on subscribers. “We’re going to find ways to grow the business,” he said, including competing more aggressively against telcos’ fixed wireless broadband and expanding Comcast’s own wireless business. Roberts also said Comcast sees a lot of room for growth in business services, which is on a $9 billion-plus annual run rate.