NBCUniversal’s Quarterly Earnings Rise 13 Percent as Theme Parks Return to Profit

NBCUniversal’s Quarterly Earnings Rise 13 Percent as Theme Parks Return to Profit

BY GEORG SZALAI | HollywoodReporter.Com

Troy Warren for CNT

Comcast reported its second-quarter results, including for its entertainment unit and European pay TV arm Sky.

NBCUniversal’s second-quarter adjusted earnings rose nearly 13 percent, helped by a return of the entertainment unit’s theme parks business to profitability after a year-ago loss due to the coronavirus pandemic, parent company Comcast said on Thursday.

The media, entertainment and technology conglomerate said the increase came despite a $363 million loss related to streaming service Peacock in the latest period. Comcast didn’t immediately provide a user update for Peacock. It had in its previous financial update in late April mentioned 42 million signups, touting at the time that the streamer had been “benefiting from the recent addition of exclusive domestic streaming rights to WWE Network and The Office.”

Management has so far this year also lauded the “strong” usage for Peacock, saying it has come in at around double the internal projections. For example, Comcast chairman and CEO Brian Roberts said a few months ago that Peacock users were consuming “nearly 20 percent more programming hours each month than our traditional audience on NBC.” The streamer at the time had just crossed 1 billion total hours watched, “nearly double our plan,” he said.

Comcast on Thursday also said it has restarted its stock buyback program, and its cable systems posted improved subscriber trends in key areas.

NBCU’s second-quarter EBITDA reached $1.55 billion, with the return of sports boosting advertising, but also driving up costs. Revenue jumped 39.2 percent to $7.96 billion.

Within NBCU, studios unit revenue increased 8.4 percent to $2.2 billion, “primarily reflecting higher theatrical revenue” after a “higher level of theater closures and theaters operating at reduced capacity due to COVID-19 in the prior-year period,” and also due to the success of releases in the latest period, including F9. Adjusted EBITDA fell 51.7 percent to $156 million on “higher operating expenses,” driven by higher programming and production expenses reflecting “an increase in television series production and comparisons to the prior year period when production was paused due to COVID-19, as well as higher advertising, marketing and promotion expenses reflecting a higher number of theatrical releases.”

Media unit revenue jumped 25.7 percent to $5.1 billion in the second quarter thanks to higher advertising, distribution revenue and other revenue. Advertising revenue rebounded 32.8 percent, “reflecting an increase in the number of sporting events and higher pricing in the current period, and reduced spending from advertisers in the prior-year period as a result of COVID-19,” the company said. These gains were “partially offset” by ratings declines. Distribution revenue rose 19.0 percent. “Other revenue increased 31.1 percent due to an increase in revenue from our digital properties,” the company said. Adjusted media EBITDA fell 15.8 percent to $1.4 billion as higher operating expenses, driven by programming and production, more than offset the revenue improvement.

The media results included $122 million of quarterly revenue and a $363 million adjusted EBITDA loss related to Peacock. That compared to $6 million in revenue and a loss of $117 million in the year-ago period. Beginning with the first quarter of 2021, Peacock results, previously reported in the “corporate and other” segment, have been included in NBCUniversal results.

Theme parks unit revenue for the second quarter increased by $958 million to $1.1 billion after “our theme parks were closed for either the majority or entirety of the period as a result of COVID-19” in the same quarter of 2020. Theme parks adjusted EBITDA swung from a $393 million loss to a $221 million profit, which included pre-opening costs related to the Universal Beijing Resort.

At Comcast’s cable systems, total customer relationships increased by 294,000 to 33.8 million in the second quarter. Broadband subscriber net additions came to 354,000, compared with 323,000 in the same period of 2020. Total video customer net losses of 399,000 compared with losses of 477,000 in the prior-year quarter.

“We delivered excellent results in the quarter, continuing our great start to the year,” said Roberts. “At NBCUniversal, adjusted EBITDA increased an impressive 13 percent, fueled by the recovery at theme parks, particularly at Universal Orlando.”

He added: “I have great confidence in our strategy and our ability to execute, which is reflected in our decision to restart our share repurchase program during the quarter, earlier than previously planned.”

Comcast shares were higher in pre-market trading.

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By Troy Warren

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