Media Business Holds Steady At NBCU

Comcast President Mike Cavanagh laid out six growth areas for the company during his quarterly conference call with Wall Street analysts Thursday morning. Not surprisingly, the linear TV business was not among them. But the Peacock streaming business was, and the theme park were as well, after leading growth for NBCUniversal in the second quarter.

CFO Jason Armstrong noted that the dual revenue streams at Peacock, subscription and advertising, are offsetting weakness at the linear networks. He said domestic advertising was down 5% overall for the NBCU media businesses, while advertising revenues for Peacock were up 75%.

NBCU’s media revenues were up 0.1% to $6.2 billion for the quarter, while adjusted EBITDA declined 18.2% to $1.2 billion. Total Content & Experiences (Comcast’s category for all of NBCU) saw revenues rise 4% to $10.9 billion, with adjusted EBITDA up 7.5% to $2.2 billion.

Cavanaugh echoed a comment by Armstrong that the ad marketplace is looking much the same for the third quarter.

“I think we feel good about our upfronts. Despite those headwinds our total cash and pricing levels were roughly in line with last year — and really strong related to Peacock in particular. A lot of that comes from the strength of our portfolio,” Cavanaugh said.

Goldman Sachs analyst Brett Feldman noted during the Q&A that Disney is rumored to be looking for a strategic partner for its ESPN assets and wondered whether NBC Sports might be a potential partner.

“I just say that’s very improbable,” Cavanaugh said, noting “tremendous issues” that would be involved in any such deal.

“When I think about our own sports business, I think we’ve got one of the best portfolios in sports — Sunday Night Football, Big Ten, EPL, NASCAR, WWE, Olympics next year, PGA, and so we’ve got a very acclaimed group of people in terms of producing excellent content around those sports — which makes us a really strong partner to leagues around the world,” Cavanaugh told the analysts. That, he said, means that NBC Sports and Sky come to the table with “more than money” when it comes to sports negotiations.

The Comcast president had little to say about the current strikes by writers and actors, except that he hoped to get to a “fair deal.” He noted that all of the studios are in the same situation, so it is a level playing field for Comcast and its competitors.