Peacock races to 10MN sign-ups but Sky revs tumble in Comcast Q2 | Major Businesses | Business
By continuing to use this site you consent to the use of cookies on your device as described in our privacy policy unless you have disabled them. You can change your cookie settings at any time but parts of our site will not function correctly without them. [Close]
In a quarter which showed clearly the defining characteristics of the Covid-affected broadcast world, Comcast has posted a widely varied second quarter of 2020 with impressive early gains for the recently launched Peacock and challenges at hitherto cash cow Sky.
comcast logo 31July2020
For the second quarter ended 30 June 2020, Comcast posted overall revenues of $23.715 billion, representing a tumble of 11.7% year-on-year. This contributed to half year revenues of $50. 324 billion, slipping back 6% on an annual basis. Net income attributable to Comcast for the second quarter was $2.988 billion down 4.4% compared with the amount at Q2 2019. Half year net income cratered 23.1% year-on-year to $5.135 billion.

Total video business for Comcast was severely hit by Covid-19. Video revenues for the quarter amounted to $5.415 billion, down 3.2%, and for the six months total revenues were $11.047 billion, a yearly fall of 1.6%. In the second quarter, Comcast lost a total of 477,000 video customers.

Looking at individual business line performance, NBCUniversal revenue – including the cable networks and broadcast networks division – was $6.124 billion for the quarter, tumbling 25.4% on an annual basis. Content licensing and other revenue increased 23.1%, due to the timing of content provided under licensing agreements, including transactions with the Peacock direct-to-consumer service in the second quarter of 2020.

Introduced on 15 July, Peacock offers more than 20,000 hours of premium content from networks and studios including NBC, Bravo, USA Network, SYFY, Oxygen, E!, CNBC, MSNBC, NBCSN, Golf Channel, Universal Kids, A&E, ABC, CBS, The CW, FOX, HISTORY and Nickelodeon. As it announced the third quarter results, Comcast revealed that in the space of little more than two weeks it had clocked up as many as 10 million sign-ups and that use and engagement times were at the high-end of expectations.

Yet perhaps the defining line in these times was with Sky. The results revealed that despite the cancellation of all of its major sports franchises — principally the Bundesliga, Premier League and Serie A football leagues from March to July to the Covid-19 outbreak — Sky retained 99% of total customers and 95% of sports subscribers. However the results also revealed that because of the cancellation of all of its major sports franchises, revenues for the quarter plummeted.

Overall revenue in the Sky business of the quarter was $4.079 billion, down 15.5% on an annual basis. Direct-to-consumer revenues fell 9.4% to $3.524 billion, primarily reflecting a decrease in average revenue per customer relationship, driven by the impacts of Covid-19, which resulted in lower sports subscription revenues, as well as decreases in customers receiving Sky services.

Advertising fell sharply, 43%, compared with the end of the second quarter of 2019 to $321 million. This was due mainly to overall market weakness, which was worsened by Covid-19, as well as what was said to be unfavourable impact from a change in legislation related to gambling advertisements in the UK and Italy. Content revenues retreated 43% in a yearly comparison to $234 million as a result of to lower revenue from sports programming as a result of the postponement of sporting events due to Covid-19.

Adjusted EBITDA for Sky decreased 2.9% to $749 million in the second quarter of 2020, while for the half year adjusted EBITDA decreased 9.4% to $1.3 billion compared with 2019.
Undeterred by the challenges of the quarter, Brian L. Roberts, chairman and chief executive officer of Comcast Corporation said that the firm’s response to Covid-19 had been “extraordinarily fast and effective” and that the firm and its products and brands continued to “resonate strongly” with customers across all segments and all geographies. “The solid results that we delivered in the quarter highlight the resilience of our company,” he added.