10-QPeriod: Q3 FY2016

COMCAST CORP Quarterly Report for Q3 Ended Sep 30, 2016

Filed October 26, 2016For Securities:CMCSACCZ

Summary

Comcast Corporation (CMCSA) reported a strong third quarter for 2016, with consolidated revenue increasing by 14.2% year-over-year to $21.3 billion. This growth was primarily driven by significant contributions from the Cable Communications and NBCUniversal segments. Net income attributable to Comcast Corporation rose by 12.1% to $2.24 billion. The company also highlighted successful integration of recent acquisitions, including DreamWorks Animation and Universal Studios Japan, which are contributing to revenue growth. Key financial strengths include robust operating income and a healthy cash flow from operations. The company continued its commitment to shareholder returns through significant share repurchases and dividend payments. Management expressed confidence in the company's ability to meet its financial obligations and invest in future growth opportunities, leveraging its diversified business model and strong market positions.

Financial Highlights

52 data points
Beta

Revenue

$21.32B

Net Income

$2.24B

10.5% Net Margin

EPS (Diluted)

$0.46

Total Assets

$177.92B

Cash & Equivalents

$2.81B

Free Cash Flow

$1.79B

Financial Statements
Beta
Revenue$21.32B
Operating Expenses$16.88B
Operating Income$4.44B
Interest Expense$751.00M
Net Income$2.24B
EPS (Basic)$0.47
EPS (Diluted)$0.46
Shares Outstanding (Basic)4.80B
Shares Outstanding (Diluted)4.86B

Key Highlights

  • 1Consolidated revenue increased 14.2% year-over-year to $21.3 billion in Q3 2016.
  • 2Net income attributable to Comcast Corporation grew 12.1% to $2.24 billion ($0.92 diluted EPS) for the quarter.
  • 3Cable Communications segment revenue increased 6.9%, driven by high-speed internet and business services growth.
  • 4NBCUniversal segment revenue saw a significant increase of 28.3%, largely due to the acquisition of Universal Studios Japan and the broadcast of the Rio Olympics.
  • 5The acquisition of DreamWorks Animation for $3.8 billion was completed in August 2016.
  • 6Comcast returned $1.38 billion to shareholders through share repurchases and paid $658 million in dividends during the quarter.
  • 7Operating income before depreciation and amortization (a key non-GAAP measure) increased across most segments, indicating strong operational performance.

Frequently Asked Questions

Revenue growth was primarily driven by the Cable Communications segment, which saw increases in high-speed Internet and business services, and the NBCUniversal segments. The NBCUniversal growth was significantly boosted by the acquisition of Universal Studios Japan and revenue from the broadcast of the 2016 Rio Olympics.

The acquisition of DreamWorks Animation was completed in August 2016 for $3.8 billion. Its results were included in the Filmed Entertainment segment from the acquisition date. While the impact on revenue and net income for the quarter was not material, the acquisition is expected to contribute to future results. The company also incurred $50 million in severance costs related to the acquisition.

Comcast actively returns capital to shareholders through share repurchases and dividends. During the third quarter of 2016, the company repurchased $1.38 billion of its Class A common stock and paid $658 million in quarterly dividends, reflecting a commitment to enhancing shareholder value.

The Cable Communications segment showed solid growth, particularly in high-speed Internet and business services. While video revenue growth was modest, customer retention improved, partly due to the X1 platform. Management expects continued growth in high-speed internet and business services, while acknowledging potential programming cost increases impacting margins.