01—Abstract
Summary
Summary of the 10-Q filed October 27, 2010. Cited figures are marked; the original filing is the authoritative source.
Comcast Corporation (CMCSA) reported its third-quarter and nine-month results for the period ending September 30, 2010.
The company demonstrated solid revenue growth, with consolidated revenue increasing by 7.3% for the quarter and 5.7% for the nine months, reaching $9.5 billiona and $28.2 billion, respectively. This growth was primarily driven by its Cable segment, which saw a 6.9% quarterly revenue increase, with notable performance in high-speed Internet and phone services. Despite a slight decrease in video customers, the company's overall financial health appears robust.
Operating income saw a significant 14.2%b increase for the quarter and a 10.6% increase for the nine months, indicating effective cost management. A major development highlighted is the pending acquisition of NBC Universal, which is expected to close by the end of 2010 and is poised to significantly expand Comcast's media and entertainment footprint. The company also continued its capital allocation strategy through share repurchases and dividend payments.
02—Key points
Key Highlights
- Consolidated revenue increased by 7.3% year-over-year for the third quarter to $9.49 billion and by 5.7% for the first nine months to $28.22 billion.
- Operating income grew significantly, up 14.2% for the quarter to $1.95 billion and 10.6% for the nine months to $5.97 billion.
- The Cable segment remains the primary revenue driver, showing a 6.9% revenue increase for the quarter, with strong performance in High-speed Internet (up 12.2%) and Phone services (up 12.6%).
- Video customer base declined by 622,000 customers for the nine-month period, a trend the company anticipates will continue.
- The company repurchased $900 million of its Class A Special common stock during the nine months and paid $800 million in dividends.
- The significant NBC Universal transaction, expected to close by year-end 2010, was a key strategic development discussed, involving the creation of a new company where Comcast will hold a 51% controlling stake.
- Cash and cash equivalents significantly increased to $4.54 billion as of September 30, 2010, from $671 million at the end of 2009, reflecting strong operating cash flow and financing activities.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2010filed October 27, 2010Financial Statements
Q3 FY2010 against Q3 FY2009
| Line item | Q3 FY2010Q3 FY2009 | Change |
|---|---|---|
| Revenue | $9.49B$8.85B | +7.3% |
| SG&A Expenses | $2.12B$1.99B | +6.5% |
| Operating Expenses | $7.54B$7.13B | +5.6% |
| Operating Income | $1.95B$1.71B | +14.2% |
| Interest Expense | $545.00M$707.00M | −22.9% |
| Net Income | $867.00M$944.00M | −8.2% |
| EPS (Basic) | $0.15$0.17 | −6.1% |
| EPS (Diluted) | $0.15$0.17 | −6.1% |
| Shares Outstanding (Basic) | 5.60B5.74B | −2.4% |
| Shares Outstanding (Diluted) | 5.62B5.75B | −2.3% |
05—Questions
Frequently Asked Questions
What was Comcast's overall financial performance for the nine months ended September 30, 2010?
For the nine months ended September 30, 2010, Comcast reported consolidated revenue of $28.2 billion, an increase of 5.7% compared to the prior year. Operating income rose by 10.6% to $6.0 billion. Net income attributable to Comcast Corporation was $2.6 billion. The company also generated strong operating cash flow of $7.7 billion.
How is the pending acquisition of NBC Universal expected to impact Comcast?
The acquisition of NBC Universal, expected to close by the end of 2010, is a transformative event. Comcast will own 51% and control of the new company, which will include NBC Universal's cable and broadcast networks, filmed entertainment, theme parks, and other assets. This transaction is expected to significantly expand Comcast's media and entertainment portfolio and revenue streams. The financial statements reflect costs associated with this transaction, and GE's remaining 49% interest will be recorded as a redeemable noncontrolling interest.
What is the trend in Comcast's video customer base, and how is it impacting revenue?
Comcast experienced a decline in its video customer base, losing 622,000 video customers in the first nine months of 2010. However, total video revenue saw a slight increase of 0.3% for the same period. This was primarily due to rate adjustments, an increase in customers taking multiple services, and upgrades to digital and advanced services, which offset the subscriber losses. The company anticipates further declines in video customers.
How did Comcast manage its cash and debt during this period?
Comcast ended the period with a significantly stronger cash position, with cash and cash equivalents increasing to $4.5 billion from $671 million at the end of 2009. This was supported by strong operating cash flows. The company also actively managed its debt, issuing $2.4 billion in notes and repurchasing or repaying $649 million of debt. Additionally, Comcast returned capital to shareholders through $900 million in share repurchases and $800 million in dividend payments.
06—Continue