Comcast Corporation
Other securities:
CMCSA
Loading chart...
Loading financial statements...
Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals.
| Line item |
|---|
ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion is provided as a supplement to, and should be read in conjunction with, the condensed consolidated financial statements and related notes (“Notes”) included in this Quarterly Report on Form 10-Q and our 2025 Annual Report on Form 10-K.
Overview
We are a global media and technology company with two primary businesses: Connectivity & Platforms and Content & Experiences. We present the operations of (1) our Connectivity & Platforms business in two segments: Residential Connectivity & Platforms and Business Services Connectivity; and (2) our Content & Experiences business in three segments: Media, Studios and Theme Parks. Refer to Note 2 for information on our segments, including a description of the segment composition change implemented in the first quarter of 2026. All amounts are presented under the updated segment structure.
The Separation of Versant occurred on January 2, 2026. The results of Versant are included in our consolidated results of operations for the three months ended March 31, 2025 and are excluded from our segment operating results (see Note 2).
Consolidated Operating Results
| Three Months Ended March 31, | Change | |||||||||||||||||||
| (in millions, except per share data) | 2026 | 2025 | % | |||||||||||||||||
| Revenue | $ | 31,457 | $ | 29,887 | 5.3 | % | ||||||||||||||
| Costs and Expenses: | ||||||||||||||||||||
| Programming and production | 10,884 | 8,415 | 29.3 | |||||||||||||||||
| Marketing and promotion | 2,164 | 2,071 | 4.5 | |||||||||||||||||
| Other operating and administrative | 10,408 | 9,893 | 5.2 | |||||||||||||||||
| Depreciation | 2,333 | 2,231 | 4.6 | |||||||||||||||||
| Amortization | 1,533 | 1,618 | (5.3) | |||||||||||||||||
| Total costs and expenses | 27,321 | 24,228 | 12.8 | |||||||||||||||||
Operating income | 4,135 | 5,658 | (26.9) | |||||||||||||||||
| Interest expense | (1,094) | (1,050) | 4.2 | |||||||||||||||||
| Investment and other income (loss), net | (309) | (116) | (165.8) | |||||||||||||||||
Income before income taxes | 2,733 | 4,492 | (39.2) | |||||||||||||||||
Income tax expense | (706) | (1,196) | (41.0) | |||||||||||||||||
Net income | 2,027 | 3,296 | (38.5) | |||||||||||||||||
| Less: Net income (loss) attributable to noncontrolling interests | (147) | (79) | 86.6 | |||||||||||||||||
Net income attributable to Comcast Corporation | $ | 2,174 | $ | 3,375 | (35.6) | % | ||||||||||||||
Basic earnings per common share attributable to Comcast Corporation shareholders | $ | 0.60 | $ | 0.90 | (32.5) | % | ||||||||||||||
Diluted earnings per common share attributable to Comcast Corporation shareholders | $ | 0.60 | $ | 0.89 | (32.6) | % | ||||||||||||||
Weighted-average number of common shares outstanding – basic | 3,597 | 3,768 | (4.5) | % | ||||||||||||||||
Weighted-average number of common shares outstanding – diluted | 3,617 | 3,784 | (4.4) | % | ||||||||||||||||
Adjusted EBITDA(a) | $ | 7,929 | $ | 9,532 | (16.8) | % | ||||||||||||||
(a)Adjusted EBITDA is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section on page 25 for additional information, including our definition and our use of Adjusted EBITDA, and for a reconciliation from net income attributable to Comcast Corporation to Adjusted EBITDA.
Consolidated revenue increased for the three months ended March 31, 2026 compared to the same period in 2025 primarily due to increases in the Content & Experiences business and in Corporate and Other, partially offset by a decrease due to the Separation in 2026 and a decrease in the Connectivity & Platforms business. Consolidated revenue for the three months ended March 31, 2025 includes the results of Versant. Revenue for our segments and other businesses is discussed separately below under the heading “Segment Operating Results.”
15
Consolidated costs and expenses, excluding depreciation and amortization expense, increased for the three months ended March 31, 2026 compared to the same period in 2025 primarily due to increases in the Content & Experiences business, in Corporate and Other and in the Connectivity and Platforms business, partially offset by a decrease due to the Separation in 2026. Consolidated costs and expenses for the three months ended March 31, 2025 includes the results of Versant.
Costs and expenses for our segments and our corporate operations and other businesses are discussed separately below under the heading “Segment Operating Results.”
Consolidated depreciation and amortization expense remained consistent with the prior year period for the three months ended March 31, 2026 primarily driven by increased depreciation due to the opening of Epic Universe in May 2025 and impairments of certain long-lived assets in the current year period, partially offset by lower amortization of customer relationships and other agreements and rights due to the Separation.
Amortization expense from acquisition-related intangible assets totaled $528 million and $789 million for the three months ended March 31, 2026 and 2025, respectively. Amounts primarily relate to intangible assets, including customer relationships and other agreements and rights, recorded in connection with the Sky transaction in 2018 and the NBCUniversal transaction in 2011.
Consolidated interest expense increased for the three months ended March 31, 2026 compared to the same period in 2025 primarily due to decreases in capitalized interest driven by the opening of Epic Universe.
Consolidated investment and other income (loss), net decreased for the three months ended March 31, 2026 compared to the same period in 2025.
| Three Months Ended March 31, | ||||||||||||||||||||
| (in millions) | 2026 | 2025 | ||||||||||||||||||
| Equity in net income (losses) of investees, net | $ | (391) | $ | (194) | ||||||||||||||||
| Realized and unrealized gains (losses) on equity securities, net | (5) | (24) | ||||||||||||||||||
| Other income (loss), net | 87 | 102 | ||||||||||||||||||
| Total investment and other income (loss), net | $ | (309) | $ | (116) | ||||||||||||||||
The change in equity in net income (losses) of investees, net for the three months ended March 31, 2026 compared to the same period in 2025 was primarily due to our investment in Atairos. The income (losses) at Atairos were driven by fair value adjustments on its underlying investments with income (loss) of $(335) million and $(169) million for the three months ended March 31, 2026 and 2025, respectively.
The change in realized and unrealized gains (losses) on equity securities, net for the three months ended March 31, 2026 was primarily due to higher net unrealized losses on nonmarketable securities in the prior year period.
The change in other income (loss), net for the three months ended March 31, 2026 primarily resulted from foreign exchange remeasurement gains in the prior year period.
Consolidated income tax expense for the three months ended March 31, 2026 and 2025 reflects an effective income tax rate that differs from the federal statutory rate due to state and foreign income taxes and adjustments associated with uncertain tax positions. The decrease in income tax expense for the three months ended March 31, 2026 compared to the same period in 2025 was primarily driven by lower domestic income before income taxes.
Consolidated net income (loss) attributable to noncontrolling interests changed for the three months ended March 31, 2026 compared to the same period in 2025 primarily due to our regional sports networks and Universal Beijing Resort.
Segment Operating Results
Our segment operating results are presented based on how we assess operating performance and internally report financial information. See Note 2 for additional information on our segments.
16
Connectivity & Platforms Results of Operations
| Three Months Ended March 31, | Change | Constant Currency Change(b) | ||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | % | % | ||||||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||||||||||
| Residential Connectivity & Platforms | $ | 17,323 | $ | 17,665 | (1.9) | % | (3.6) | % | ||||||||||||||||||||||
| Business Services Connectivity | 2,640 | 2,496 | 5.8 | 5.7 | ||||||||||||||||||||||||||
| Total Connectivity & Platforms revenue | $ | 19,962 | $ | 20,161 | (1.0) | % | (2.5) | % | ||||||||||||||||||||||
| Adjusted EBITDA | ||||||||||||||||||||||||||||||
| Residential Connectivity & Platforms | $ | 6,434 | $ | 6,842 | (6.0) | % | (6.5) | % | ||||||||||||||||||||||
| Business Services Connectivity | 1,476 | 1,422 | 3.8 | 3.9 | ||||||||||||||||||||||||||
| Total Connectivity & Platforms Adjusted EBITDA | $ | 7,910 | $ | 8,264 | (4.3) | % | (4.7) | % | ||||||||||||||||||||||
Adjusted EBITDA Margin(a) | ||||||||||||||||||||||||||||||
| Residential Connectivity & Platforms | 37.1 | % | 38.7 | % | (160) bps | (120) bps | ||||||||||||||||||||||||
| Business Services Connectivity | 55.9 | 57.0 | (110) bps | (100) bps | ||||||||||||||||||||||||||
| Total Connectivity & Platforms Adjusted EBITDA margin | 39.6 | % | 41.0 | % | (140) bps | (100) bps | ||||||||||||||||||||||||
(a)Our Adjusted EBITDA margin is Adjusted EBITDA as a percentage of revenue. We believe this metric is useful particularly as we continue to focus on growing our higher-margin businesses and improving overall operating cost management. The changes reflect the year-over-year basis point changes in the rounded Adjusted EBITDA margins.
(b)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section on page 25 for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency amounts.
We continue to focus on growing our higher-margin connectivity businesses while managing overall operating costs. We also continue to invest in our network to support higher-speed broadband offerings and to expand the number of residential and business passings. Our customer relationship additions/(losses) continue to be negatively impacted by an increasingly competitive environment. We are focused on increasing our residential connectivity revenue. In 2025, we simplified our broadband pricing structure and began offering a free wireless line for one year to new and existing domestic broadband customers, which we expect will improve customer retention and strengthen our ability to compete for new customers, but will negatively impact average domestic broadband revenue per customer. We also expect continued declines in video revenue as a result of domestic customer net losses due to shifting video consumption patterns and the competitive environment, although customer net losses typically mitigate the impact of continued rate increases on programming expenses, as well as continued declines in other revenue related to declines in wireline voice revenue. We are also focused on growing our Business Services Connectivity segment revenue by offering competitive services, including enterprise solutions, and driving higher adoption of our advanced solutions.
Connectivity & Platforms Customer Metrics
| Net Additions / (Losses) | |||||||||||||||||||
| March 31, | Three Months Ended March 31, | ||||||||||||||||||
| (in thousands) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||
Residential Connectivity & Platforms Customer Relationships(a) | |||||||||||||||||||
| Domestic Residential Connectivity & Platforms customer relationships | 30,345 | 30,969 | (94) | (204) | |||||||||||||||
International Residential Connectivity & Platforms customer relationships(b) | 17,603 | 17,674 | 104 | (11) | |||||||||||||||
Total Residential Connectivity & Platforms customer relationships(b) | 47,948 | 48,643 | 10 | (215) | |||||||||||||||
| Domestic Residential Broadband | |||||||||||||||||||
| Domestic broadband residential customers | 28,654 | 29,190 | (65) | (183) | |||||||||||||||
Domestic residential passings(c) | 59,164 | 58,063 | |||||||||||||||||
Domestic broadband residential penetration of residential passings(d) | 48.4 | % | 50.3 | % | |||||||||||||||
| Domestic Wireless | |||||||||||||||||||
Domestic wireless lines(e) | 9,739 | 8,148 | 435 | 323 | |||||||||||||||
| Domestic Video | |||||||||||||||||||
| Domestic video customers | 10,948 | 12,096 | (322) | (427) | |||||||||||||||
(a)Residential Connectivity & Platforms customer relationships generally represent the number of residential customers that subscribe to at least one of our services. International Residential Connectivity & Platforms customer relationships represent customers receiving Sky services in the United Kingdom and Italy. Because each of our services includes a variety of product tiers, which may change from time to time, net additions or losses in any one period will
17
reflect a mix of customers at various tiers.
(b)Total Residential Connectivity & Platforms customer relationships and International Residential Connectivity & Platforms customer relationships were updated in the first quarter of 2026 due to a conforming change in methodology, resulting in a decrease of 125,000 customers. There was no impact to net additions and information for the prior period has been recast on a comparable basis.
(c)Connectivity & Platforms domestic residential passings are considered passed if we can connect them to our network in the United States without further extending the transmission lines. The number of residential passings is an estimate based on the best available information.
(d)Penetration is calculated by dividing the number of domestic broadband residential customers located within our network by the number of domestic residential passings.
(e)Domestic wireless lines represent the number of residential and business customers’ wireless devices. An individual customer relationship may have multiple wireless lines.
Connectivity & Platforms — Supplemental Costs and Expenses Information
Connectivity & Platforms supplemental costs and expenses information in the table below is presented on an aggregate basis across the Connectivity & Platforms segments as the segments use certain shared infrastructure, including our network in the United States. Costs and expenses information reported separately for the Residential Connectivity & Platforms and Business Services Connectivity segments includes each segment’s direct costs and an allocation of shared costs.
| Three Months Ended March 31, | Change | Constant Currency Change(g) | |||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | % | % | |||||||||||||||||||||||||||
| Costs and Expenses | |||||||||||||||||||||||||||||||
Programming(a) | $ | 3,787 | $ | 4,107 | (7.8) | % | (10.2) | % | |||||||||||||||||||||||
Technical and support(b) | 1,968 | 1,935 | 1.7 | 0.2 | |||||||||||||||||||||||||||
Direct product costs(c) | 1,962 | 1,625 | 20.7 | 16.5 | |||||||||||||||||||||||||||
Marketing and promotion(d) | 1,337 | 1,242 | 7.6 | 5.9 | |||||||||||||||||||||||||||
Customer service(e) | 676 | 682 | (1.0) | (2.3) | |||||||||||||||||||||||||||
Other(f) | 2,323 | 2,305 | 0.8 | (0.8) | |||||||||||||||||||||||||||
| Total Connectivity & Platforms costs and expenses | $ | 12,052 | $ | 11,897 | 1.3 | % | (0.9) | % | |||||||||||||||||||||||
(a)Programming expenses, which represent our most significant operating expense, are the fees we incur to provide video services to our customers, and primarily include fees related to the distribution of television network programming and fees charged for retransmission of the signals from local broadcast television stations. These expenses also include the costs of content on the Sky-branded entertainment television networks, including amortization of licensed content.
(b)Technical and support expenses primarily consist of costs for labor to complete service call and installation activities; and costs for network operations and satellite transmission, product development, fulfillment and provisioning.
(c)Direct product costs primarily consist of access fees related to using wireless and broadband networks owned by third parties to deliver our services and costs of products sold, including wireless devices and Sky Glass smart televisions.
(d)Marketing and promotion expenses primarily consist of the costs associated with attracting new customers and promoting our service offerings.
(e)Customer service expenses primarily consist of the personnel and other costs associated with customer service and certain selling activities.
(f)Other expenses primarily consist of administrative personnel costs; franchise and other regulatory fees; fees paid to third parties where we are acting as the principal in the advertising representation arrangement; bad debt; building and office expenses, taxes and billing costs; and other business, headquarters and support costs necessary to operate the Connectivity & Platforms business.
(g)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section on page 25 for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency amounts.
18
Residential Connectivity & Platforms Segment Results of Operations
| Three Months Ended March 31, | Change | Constant Currency Change(a) | |||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025(b) | % | % | |||||||||||||||||||||||||||
| Revenue | |||||||||||||||||||||||||||||||
| Domestic broadband | $ | 6,338 | $ | 6,679 | (5.1) | % | (5.1) | % | |||||||||||||||||||||||
| Domestic wireless service | 977 | 850 | 15.0 | 15.0 | |||||||||||||||||||||||||||
| Domestic convergence revenue | 7,315 | 7,529 | (2.8) | (2.8) | |||||||||||||||||||||||||||
| Domestic wireless equipment | 418 | 273 | 52.9 | 52.9 | |||||||||||||||||||||||||||
| International connectivity | 1,240 | 1,132 | 9.5 | 2.0 | |||||||||||||||||||||||||||
| Total residential connectivity | 8,973 | 8,933 | 0.4 | (0.5) | |||||||||||||||||||||||||||
| Video | 6,256 | 6,600 | (5.2) | (7.6) | |||||||||||||||||||||||||||
| Advertising | 951 | 899 | 5.8 | 2.9 | |||||||||||||||||||||||||||
| Other | 1,143 | 1,233 | (7.2) | (8.9) | |||||||||||||||||||||||||||
| Total revenue | 17,323 | 17,665 | (1.9) | (3.6) | |||||||||||||||||||||||||||
| Costs and Expenses | |||||||||||||||||||||||||||||||
| Programming | 3,787 | 4,107 | (7.8) | (10.2) | |||||||||||||||||||||||||||
| Other | 7,102 | 6,716 | 5.7 | 3.4 | |||||||||||||||||||||||||||
| Total costs and expenses | 10,889 | 10,823 | 0.6 | (1.8) | |||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 6,434 | $ | 6,842 | (6.0) | % | (6.5) | % | |||||||||||||||||||||||
(a)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section on page 25 for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency amounts.
(b)Beginning in the first quarter of 2026, commission revenue from the sale of certain DTC streaming services is presented in domestic broadband revenue or video revenue based on whether a customer is entitled to receive the DTC streaming service through a broadband or video service offering. Domestic broadband revenue also includes revenue from streaming devices available to our broadband customers. Previously, all of these amounts were in video revenue. Prior periods have been reclassified to reflect the current year presentation.
Residential Connectivity & Platforms Segment – Revenue
Domestic broadband revenue primarily consists of revenue from sales of broadband services to residential customers in the United States, including equipment and installation sales. Domestic broadband revenue also includes commission revenue from the sale of DTC streaming services that a customer is entitled to receive through a broadband service offering, as well as revenue from streaming devices available to our broadband customers.
Domestic broadband revenue decreased for the three months ended March 31, 2026 compared to the same period in 2025 due to a decrease in average rates and a decline in the number of domestic broadband customers.
Domestic wireless service revenue primarily consists of revenue from sales of wireless services to residential customers in the United States.
Domestic wireless service revenue increased for the three months ended March 31, 2026 compared to the same period in 2025 due to an increase in the number of customer lines.
Domestic wireless equipment revenue primarily consists of revenue from sales of wireless devices, including handsets, tablets and smart watches, to residential customers in the United States.
Domestic wireless equipment revenue increased for the three months ended March 31, 2026 compared to the same period in 2025 due to an increase in the number of device sales.
International connectivity revenue primarily consists of revenue from sales of broadband services, including equipment and installation services, wireless services and wireless devices to residential customers in the United Kingdom and Italy.
International connectivity revenue increased for the three months ended March 31, 2026 compared to the same period in 2025 primarily due to the positive impact of foreign currency and an increase in broadband revenue resulting from an increase in average rates.
Video revenue primarily consists of revenue from sales of video services to residential and business customers across the Connectivity & Platforms markets, including equipment and installation services. Video revenue includes pay-per-view and other transactional revenue and franchise fees, and revenue from sales of certain hardware, including Sky Glass smart televisions. Video revenue also includes commission revenue from the sale of DTC streaming services that a customer is entitled to receive through a video service offering.
Video revenue decreased for the three months ended March 31, 2026 compared to the same period in 2025 primarily due to a decline in the overall number of video customers, partially offset by the positive impact of foreign currency.
19
Advertising revenue primarily consists of revenue from the sale of advertising across our platforms in the Connectivity & Platforms markets, including advertising as part of our distribution agreements with cable networks in the United States, and advertising on Sky-branded entertainment television networks and on our digital properties. Advertising also includes revenue where we enter into representation agreements under which we sell advertising on behalf of third parties and from our advanced advertising businesses.
Advertising revenue increased for the three months ended March 31, 2026 compared to the same period in 2025 primarily due to an increase in revenue from our advanced advertising business, the positive impact from foreign currency and higher domestic political advertising.
Other revenue primarily consists of revenue in the Connectivity & Platforms markets from sales of wireline voice services to residential customers; our residential security and automation services businesses; the licensing of our technology platforms to other multichannel video providers; the distribution of certain of our Sky-branded entertainment television networks to third-party video service providers; commissions from electronic retailing networks; and certain billing and collection fees.
Other revenue decreased for the three months ended March 31, 2026 compared to the same period in 2025 primarily due to a decrease in residential wireline voice revenue driven by a decline in the number of customers.
Residential Connectivity & Platforms Segment – Costs and Expenses
Programming expenses decreased for the three months ended March 31, 2026 compared to the same period in 2025 primarily due to a decline in the number of domestic video subscribers, partially offset by the impact of foreign currency.
Other expenses increased for the three months ended March 31, 2026 compared to the same period in 2025 primarily due to increased direct product costs, the impact of foreign currency and increased spending on marketing and promotion.
Business Services Connectivity Segment Results of Operations
Next expected filings
- ~2026-07-30 10-Q expected by 2026-08-12 (in 90 days)
- ~2026-10-29 10-Q expected by 2026-11-11 (in 181 days)
- ~2027-02-02 10-K expected by 2027-02-28 (in 277 days)
- ~2027-04-22 10-Q expected by 2027-05-05 (in 356 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-04-23 8-K Earnings Release; Financial Statements and Exhibits
- 2026-04-23 10-Q Quarterly Report
- 2026-02-27 8-K Officer/Director Change
- 2026-02-03 10-K Annual Report
- 2026-01-29 8-K Earnings Release; Financial Statements and Exhibits
- 2026-01-05 8-K Other Events; Financial Statements and Exhibits
- 2025-12-23 8-K Officer/Director Change
- 2025-12-15 8-K Unregistered Equity Sale; Bylaws/Articles Amended; Financial Statements and Exhibits
- 2025-12-03 8-K Other Events; Financial Statements and Exhibits
- 2025-10-30 10-Q Quarterly Report
- 2025-10-30 8-K Earnings Release; Financial Statements and Exhibits
- 2025-10-09 8-K Material Financial Obligation; Other Events; Financial Statements and Exhibits
- 2025-10-08 8-K Other Events; Financial Statements and Exhibits
- 2025-10-06 8-K Other Events; Financial Statements and Exhibits
- 2025-10-02 8-K Material Financial Obligation; Other Events; Financial Statements and Exhibits