January 26, 2017

Comcast Reports 4th Quarter and Year End 2016 Results

Full Year 2016 Highlights:

  • Consolidated Revenue Increased 7.9%, Operating Income Increased 5.4%, Operating Cash Flow Increased 7.0%
  • Net Cash Provided by Operating Activities was $19.2 Billion; Free Cash Flow was $8.2 Billion
  • Earnings per Share Increased 10.2% to $3.57; On an Adjusted Basis, EPS Increased 7.1% to $3.48
  • Cable Communications Revenue Increased 6.6% and Operating Cash Flow Increased 5.6%
  • Customer Relationships Increased by 858,000, a 29.0% Improvement Compared to 2015; Best Video Customer Results in 10 Years; Best High-Speed Internet Customer Results in 9 Years
  • NBCUniversal Revenue Increased 11.0% and Operating Cash Flow Increased 13.8%

4th Quarter 2016 Highlights:

  • Consolidated Revenue Increased 9.2%, Operating Income Increased 6.6%, Operating Cash Flow Increased 7.8%
  • Net Cash Provided by Operating Activities was $5.7 Billion; Free Cash Flow was $2.6 Billion
  • Earnings per Share Increased 20.3% to $0.95; On an Adjusted Basis, EPS Increased 9.9% to $0.89
  • Cable Communications Revenue Increased 7.1% and Operating Cash Flow Increased 6.4%
  • Added 258,000 Customer Relationships; Video Customer Net Additions were 80,000; High-Speed Internet Customer Net Additions were 385,000
  • NBCUniversal Revenue Increased 13.0% and Operating Cash Flow Increased 14.0%

Dividends and Share Repurchases:

  • Dividends and Share Repurchases Totaled $7.6 Billion in 2016
  • Declared a Two-for-One Stock Split in the Form of a 100% Dividend Payable on February 17, 2017; 12th Stock Split in Company History
  • Increased Dividend by 15% to $1.26 per Share on an Annualized, Pre-Split Basis; Increased Share Repurchase Authorization to $12.0 Billion, with $5.0 Billion Expected to be Repurchased in 2017

PHILADELPHIA--(BUSINESS WIRE)-- Comcast Corporation (NASDAQ: CMCSA) today reported results for the quarter and year ended December 31, 2016.

Brian L. Roberts, Chairman and Chief Executive Officer of Comcast Corporation, said, "I look back on 2016 with pride and enthusiasm. This is a special company, with a team I am delighted to work with, executing at a high level. We're pleased to report another year of strong financial and operational results, which reflect our focus on innovation, investing in the business and putting the customer first. Our performance at Comcast Cable was exceptionally strong. We grew operating cash flow 5.6%, added 161,000 video subscribers, the best video customer results in a decade, and delivered our best high-speed Internet customer results in nine years. NBCUniversal also had a terrific year, fueled by the tremendous success of the Olympics, the opening of new attractions at our theme parks, and strong theatrical performances, particularly in animation. The consistency and strength of our results enables us to announce that we are increasing our dividend by 15% per share, we will split our stock two-for-one, the twelfth split in our company's history, and we expect to repurchase $5 billion of our stock this year. As we begin 2017, we are well positioned to continue driving growth and shareholder value as we embark on the opportunities ahead."

 

Consolidated Financial Results

  4th Quarter   Full Year
($ in millions)   2015   2016   Growth   2015   2016   Growth
Revenue $19,245   $21,025   9.2% $74,510   $80,403   7.9%
Excluding Olympics and Super Bowl (see Table 7)               $74,134   $78,783   6.3%
Operating Income   $4,002   $4,264   6.6%   $15,998   $16,859   5.4%
Operating Cash Flow1 $6,272 $6,760 7.8% $24,678 $26,417 7.0%
Excluding Transaction-Related Costs (see Table 7)               $24,856   $26,417   6.3%
Earnings per Share2 $0.79 $0.95 20.3% $3.24 $3.57 10.2%
Excluding Adjustments (see Table 5)   $0.81   $0.89   9.9%   $3.25   $3.48   7.1%
Net Cash Provided by Operating Activities   $4,965   $5,743   15.7%   $18,778   $19,240   2.5%
Free Cash Flow3 $1,588 $2,607 64.2% $8,935 $8,203 (8.2%)

For additional detail on segment revenue and expenses, customer metrics, capital expenditures, and free cash flow, please refer to the trending schedules on Comcast's Investor Relations website at www.cmcsa.com.

Consolidated Revenue for the fourth quarter of 2016 increased 9.2% to $21.0 billion. Consolidated Operating Income increased 6.6% to $4.3 billion. Consolidated Operating Cash Flow increased 7.8% to $6.8 billion.

For the year ended December 31, 2016, consolidated revenue increased 7.9% to $80.4 billion compared to 2015. Excluding $1.6 billion of revenue generated by the broadcast of the 2016 Rio Olympics in the third quarter of 2016, as well as $376 million of revenue generated by the broadcast of the NFL's Super Bowl in the first quarter of 2015, consolidated revenue increased 6.3% (see Table 7). Consolidated operating income increased 5.4% to $16.9 billion compared to 2015. Consolidated operating cash flow increased 7.0% to $26.4 billion compared to 2015. Excluding $178 million of transaction-related costs in 2015, consolidated operating cash flow increased 6.3% (see Table 7).

Earnings per Share (EPS) for the fourth quarter of 2016 was $0.95, a 20.3% increase compared to the fourth quarter of 2015. On an adjusted basis, EPS increased 9.9% to $0.89 (see Table 5).

For the year ended December 31, 2016, EPS was $3.57, a 10.2% increase compared to the prior year. On an adjusted basis, EPS increased 7.1% to $3.48 (see Table 5).

Capital Expenditures decreased 2.4% to $2.6 billion in the fourth quarter of 2016 compared to 2015. Cable Communications' capital expenditures increased 1.5% to $2.1 billion in the fourth quarter of 2016, reflecting increased spending on line extensions, support capital and scalable infrastructure, as well as continued spending on customer premise equipment related to the deployment of the X1 platform and wireless gateways. Cable capital expenditures represented 16.3% of Cable revenue in the fourth quarter of 2016 compared to 17.2% in last year's fourth quarter. NBCUniversal's capital expenditures of $461 million decreased 17.2% compared to 2015, which included a land purchase adjacent to an existing theme park of $130 million.

For the year ended December 31, 2016, capital expenditures increased 7.5% to $9.1 billion compared to 2015. Cable Communications' capital expenditures increased 7.9% to $7.6 billion, primarily reflecting increased investment in line extensions, a higher level of investment in scalable infrastructure to increase network capacity and continued spending on customer premise equipment related to the deployment of the X1 platform and wireless gateways. For the year, Cable capital expenditures represented 15.2% of Cable revenue compared to 15.0% in 2015. NBCUniversal's capital expenditures increased 4.8% to $1.5 billion in 2016, primarily reflecting increased spending at our Theme Parks.

Net Cash Provided by Operating Activities increased 15.7% to $5.7 billion in the fourth quarter of 2016. Free Cash Flow increased 64.2% to $2.6 billion, reflecting growth in consolidated operating cash flow and improvements in working capital, partially offset by higher cash taxes (see Table 4).

For the year ended December 31, 2016, net cash provided by operating activities increased 2.5% to $19.2 billion. Free cash flow decreased 8.2% to $8.2 billion compared to 2015, reflecting growth in consolidated operating cash flow, offset by higher working capital, an increase in capital expenditures, an increase in capitalized software and intangibles, and higher cash taxes (see Table 4).

Dividends, Share Repurchases and Stock Split. During the fourth quarter of 2016, Comcast paid dividends totaling $658 million and repurchased 19.3 million of its common shares for $1.2 billion. For the full year, Comcast made four cash dividend payments totaling $2.6 billion and repurchased 80.6 million of its common shares for $5.0 billion, resulting in a total return of capital to shareholders of $7.6 billion for 2016.

Today, Comcast announced that its Board of Directors has increased its stock repurchase program authorization to $12.0 billion. Comcast expects to repurchase $5.0 billion of its Class A common stock during 2017, subject to market conditions.

Comcast also announced that its Board of Directors declared a two-for-one stock split in the form of a 100% dividend payable on February 17, 2017 to shareholders of record as of the close of business on February 8, 2017. As the common stock is not yet trading on a post-split basis, all share and per-share amounts in this earnings release and the accompanying schedules are presented on a pre-split basis.

In addition, Comcast announced that it increased its dividend by 15% to $1.26 per share on an annualized, pre-split basis, or $0.63 per share on an annualized, post-split basis. In accordance with the increase, the Board of Directors declared a quarterly cash dividend of $0.1575 a share, on a post-split basis, on the company's common stock, payable on April 26, 2017 to shareholders of record as of the close of business on April 5, 2017.

 

Cable Communications

  4th Quarter   Full Year
($ in millions)   20154   2016   Growth   20154   2016   Growth
Cable Communications Revenue                        
Video   $5,416   $5,647   4.3%   $21,526   $22,357   3.9%
High-Speed Internet   3,197   3,483   9.0%   12,471   13,532   8.5%
Voice   899   873   (3.0%)   3,608   3,540   (1.9%)
Business Services   1,261   1,444   14.5%   4,751   5,514   16.1%
Advertising   634   728   14.9%   2,298   2,518   9.6%
Other   589   668   13.6%   2,274   2,587   13.8%
Cable Communications Revenue $11,996   $12,843   7.1% $46,928   $50,048   6.6%
                         
Cable Communications Operating Cash Flow   $4,876   $5,186   6.4%   $19,037   $20,109   5.6%
Operating Cash Flow Margin 40.6% 40.4% 40.6% 40.2%
                         
Cable Communications Capital Expenditures   $2,063   $2,095   1.5%   $7,040   $7,596   7.9%
Percent of Cable Communications Revenue   17.2%   16.3%       15.0%   15.2%    
 

Revenue for Cable Communications increased 7.1% to $12.8 billion in the fourth quarter of 2016, driven primarily by increases in high-speed Internet, video and business services revenue. High-speed Internet revenue increased 9.0%, driven by an increase in the number of residential high-speed Internet customers and rate adjustments. Video revenue increased 4.3%, reflecting rate adjustments and an increase in the number of customers subscribing to additional services. Business services revenue increased 14.5%, primarily due to an increase in the number of small business customers, as well as continued growth in our medium-sized business services. Advertising revenue increased 14.9%, reflecting an increase in political advertising revenue. Other revenue increased 13.6%, primarily reflecting an increase in Xfinity Home revenue and higher franchise and regulatory fees.

For the year ended December 31, 2016, Cable revenue increased 6.6% to $50.0 billion compared to 2015, driven by growth in high-speed Internet, video and business services.

Customer Relationships increased by 258,000 to 28.6 million in the fourth quarter of 2016, primarily reflecting an increase in double product relationships. At the end of the fourth quarter, penetration of our double and triple product customers increased to 70.1% compared to 69.8% in the fourth quarter of 2015. Video customer net additions were 80,000, high-speed Internet customer net additions were 385,000 and voice customer net additions were 44,000.

For the year ended December 31, 2016, customer relationships increased by 858,000, a 29.0% increase compared to net additions of 666,000 in 2015. Video customer net additions of 161,000 were the best result in ten years. High-speed Internet customer net additions of 1.4 million marked the 11th consecutive year of more than one million net additions, and were the best result in nine years. Voice customer net additions were 211,000.

  Customers           Net Additions
(in thousands)   YE15   YE16           4Q15   4Q16       2015   2016
Video Customers   22,347   22,508           89   80       (36)   161
High-Speed Internet Customers   23,329   24,701           460   385       1,367   1,373
Voice Customers   11,475   11,687           139   44       282   211
                                     
Single Product Customers   8,366   8,541           (1)   53       (43)   175
Double Product Customers   9,221   9,699           156   159       472   477
Triple Product Customers   10,114   10,319           126   46       238   205
Customer Relationships 27,701   28,559 281   258       666   858
Customer metrics include residential and business customers.
 

Operating Cash Flow for Cable Communications increased 6.4% to $5.2 billion in the fourth quarter of 2016, reflecting higher revenue, partially offset by a 7.5% increase in operating expenses. The higher expenses were primarily due to a 12.2% increase in video programming costs, reflecting the timing of contract renewals, as well as higher retransmission consent fees and sports programming costs. Technical and product support expenses increased 6.6% related to the development, delivery and support of our X1 platform, cloud DVR technology and wireless gateways, and the continued growth in business services and home security and automation services. Advertising, marketing and promotion costs increased 3.5%, primarily due to increases in spending associated with attracting new residential and business services customers. Customer service expenses decreased 2.1%, reflecting reduced call volumes. This quarter's operating cash flow margin was 40.4% compared to 40.6% in the fourth quarter of 2015.

For the year ended December 31, 2016, Cable operating cash flow increased 5.6% to $20.1 billion compared to 2015, driven by higher revenue, partially offset by a 7.3% increase in operating expenses, primarily related to a 10.1% increase in video programming costs, as well as higher technical and product support expenses, higher advertising, marketing and promotion costs, and higher customer service expenses. For the year, operating cash flow margin was 40.2% compared to 40.6% in 2015.

 

NBCUniversal

  4th Quarter   Full Year
($ in millions)   2015   2016  

Reported
Growth

 

Pro Forma
Growth5

  2015   2016  

Reported
Growth

 

Pro Forma
Growth5

NBCUniversal Revenue                                
Cable Networks $2,407   $2,503   4.0%   $9,628   $10,464   8.7%  

Excluding Olympics

                 

$9,628

 

$10,032

 

4.2%

   
Broadcast Television 2,498 2,848 14.0%

8,530

10,147

19.0%

Excluding Olympics and Super Bowl

 

 

             

8,154

 

8,959

 

9.9%

   
Filmed Entertainment   1,629   1,834   12.6%       7,287   6,360   (12.7%)    
Theme Parks   1,019   1,344   32.1%   13.2%   3,339   4,946   48.2%   12.7%
Headquarters, Other and Eliminations   (76)   (78)   NM       (322)   (324)   NM    
NBCUniversal Revenue $7,477 $8,451 13.0% 10.5% $28,462 $31,593 11.0% 7.0%

Excluding Olympics and Super Bowl

$28,086

$29,973

6.7%

2.9%

                                 
NBCUniversal Operating Cash Flow                                
Cable Networks   $894   $916   2.4%       $3,499   $3,709   6.0%    
Broadcast Television   217   264   21.1%       780   1,320   69.1%    
Filmed Entertainment   143   121   (15.3%)       1,234   697   (43.5%)    
Theme Parks   452   640   41.9%   18.4%   1,464   2,190   49.6%   12.2%
Headquarters, Other and Eliminations   (154)   (171)   NM       (625)   (689)   NM    
NBCUniversal Operating Cash Flow $1,552 $1,770 14.0% 7.8% $6,352 $7,227 13.8% 5.7%
NM=comparison not meaningful.
 

Revenue for NBCUniversal increased 13.0% to $8.5 billion in the fourth quarter of 2016 and Operating Cash Flow increased 14.0% to $1.8 billion. Pro Forma5 Revenue for NBCUniversal increased 10.5%. Pro Forma5 Operating Cash Flow increased 7.8%, reflecting increases at Theme Parks, Broadcast Television and Cable Networks, partially offset by a decline at Filmed Entertainment.

For the year ended December 31, 2016, NBCUniversal revenue increased 11.0% to $31.6 billion compared to 2015 and operating cash flow increased 13.8% to $7.2 billion. Pro forma5 revenue for NBCUniversal increased 7.0%. Pro forma5 operating cash flow increased 5.7%, reflecting increases at Broadcast Television, Theme Parks and Cable Networks, partially offset by a decline at Filmed Entertainment.

Cable Networks

Cable Networks revenue increased 4.0% to $2.5 billion in the fourth quarter of 2016, reflecting higher distribution, content licensing and other, and advertising revenue. Distribution revenue increased 4.7%, driven by contractual rate increases and contract renewals, partially offset by a decline in subscribers at our cable networks. Content licensing and other revenue increased 14.6%, due to the timing of content provided under licensing agreements. Advertising revenue increased 0.6%, due to higher rates, mostly offset by audience ratings declines. Operating cash flow increased 2.4% to $916 million in the fourth quarter of 2016, reflecting higher revenue, partially offset by an increase in programming and production costs.

For the year ended December 31, 2016, revenue from the Cable Networks segment increased 8.7% to $10.5 billion compared to 2015, reflecting higher distribution, advertising, and content licensing and other revenue. Excluding $432 million of revenue generated by the broadcast of the 2016 Rio Olympics in the third quarter of 2016, revenue increased 4.2% (see Table 7). Operating cash flow increased 6.0% to $3.7 billion compared to 2015, reflecting higher revenue, partially offset by an increase in programming and production costs.

Broadcast Television

Broadcast Television revenue increased 14.0% to $2.8 billion in the fourth quarter of 2016, reflecting higher advertising, content licensing, and distribution and other revenue. Advertising revenue increased 12.4%, driven by the premiere of Thursday Night Football, higher rates, and higher political advertising. Content licensing revenue increased 20.2%, primarily due to the timing of content provided under licensing agreements. Distribution and other revenue increased 14.1%, due to higher retransmission consent fees. Operating cash flow increased 21.1% to $264 million in the fourth quarter of 2016, reflecting higher revenue, partially offset by an increase in programming and production costs, driven by the premiere of Thursday Night Football.

For the year ended December 31, 2016, revenue from the Broadcast Television segment increased 19.0% to $10.1 billion compared to 2015. Excluding $1.2 billion of revenue generated by the broadcast of the 2016 Rio Olympics in the third quarter of 2016, as well as $376 million of revenue generated by the broadcast of the NFL's Super Bowl in the first quarter of 2015, revenue increased 9.9% (see Table 7). Operating cash flow increased 69.1% to $1.3 billion compared to 2015, reflecting higher revenue, partially offset by an increase in programming and production costs primarily associated with the broadcast of the 2016 Rio Olympics.

Filmed Entertainment

Filmed Entertainment revenue increased 12.6% to $1.8 billion in the fourth quarter of 2016, which included a full quarter of revenue attributable to DreamWorks, which was acquired on August 22nd. Content licensing revenue increased 37.5%, due to the inclusion of DreamWorks, as well as the timing of when content was made available under licensing agreements. Theatrical revenue increased 96.7%, primarily due to the strong performance of Sing in this year's fourth quarter. Other revenue increased 55.5%, primarily driven by the inclusion of DreamWorks. Home entertainment revenue declined 36.0%, reflecting the success of several releases in the prior year period, including Jurassic World, Minions and Trainwreck. Operating cash flow decreased 15.3% to $121 million in the fourth quarter of 2016, reflecting higher revenue, offset by increased expenses driven by DreamWorks, which included integration and restructuring costs.

For the year ended December 31, 2016, revenue from the Filmed Entertainment segment decreased 12.7% to $6.4 billion compared to 2015, reflecting lower theatrical and home entertainment revenue, partially offset by higher content licensing and other revenue. Operating cash flow decreased 43.5% to $697 million compared to 2015, reflecting lower revenue, partially offset by lower programming and production costs.

Theme Parks

Theme Parks revenue increased 32.1% to $1.3 billion in the fourth quarter of 2016. Pro forma5 revenue increased 13.2%, reflecting higher attendance and higher per capita spending, driven by the success of Hollywood's The Wizarding World of Harry Potter™ attraction, as well as the positive impact of a stronger Japanese yen. Operating cash flow increased 41.9% to $640 million in the fourth quarter of 2016. Pro forma5 operating cash flow increased 18.4%, reflecting higher revenue, partially offset by an increase in operating expenses, including costs to support new attractions.

For the year ended December 31, 2016, revenue from the Theme Parks segment increased 48.2% to $4.9 billion compared to 2015. Pro forma5 revenue increased 12.7%, reflecting higher attendance and per capita spending, as well as the positive impact of a stronger Japanese yen. Operating cash flow increased 49.6% to $2.2 billion compared to 2015. Pro forma5 operating cash flow increased 12.2%, reflecting higher revenue, partially offset by an increase in operating expenses, including costs to support new attractions.

Headquarters, Other and Eliminations

NBCUniversal Headquarters, Other and Eliminations include overhead and eliminations among the NBCUniversal businesses. For the quarter ended December 31, 2016, NBCUniversal Headquarters, Other and Eliminations operating cash flow loss was $171 million compared to a loss of $154 million in the fourth quarter of 2015.

For the year ended December 31, 2016, NBCUniversal Headquarters, Other and Eliminations operating cash flow loss was $689 million compared to a loss of $625 million in 2015.

Corporate, Other and Eliminations

Corporate, Other and Eliminations primarily include corporate operations, Comcast Spectacor and eliminations among Comcast's businesses. For the quarter ended December 31, 2016, Corporate, Other and Eliminations revenue was ($269) million compared to ($228) million in 2015. The operating cash flow loss was $196 million compared to a loss of $156 million in the fourth quarter of 2015.

For the year ended December 31, 2016, Corporate, Other and Eliminations revenue was ($1.2) billion compared to ($880) million in 2015. The operating cash flow loss was $919 million compared to a loss of $711 million in 2015.

Notes:

  1. We define Operating Cash Flow as operating income (loss) before depreciation and amortization, excluding impairment charges related to fixed and intangible assets and gains or losses on the sale of assets, if any. See Table 4 for reconciliation of non-GAAP financial measures.
  2. Earnings per share amounts are presented on a pre-split, diluted basis.
  3. We define Free Cash Flow as Net Cash Provided by Operating Activities (as stated in our Consolidated Statement of Cash Flows) reduced by capital expenditures, cash paid for intangible assets, principal payments on capital leases and cash distributions to noncontrolling interests; and adjusted for any payments and receipts related to certain nonoperating items, net of estimated tax benefits. The definition of Free Cash Flow excludes any impact from Economic Stimulus packages. These amounts have been excluded from Free Cash Flow to provide an appropriate comparison. See Table 4 for reconciliation of non-GAAP financial measures.
  4. Beginning in the first quarter of 2016, certain operations and businesses including several strategic business initiatives that were previously presented in Corporate, Other and Eliminations are now presented in our Cable Communications segment to reflect a change in our management reporting presentation. For segment reporting purposes, we have adjusted all periods presented to reflect this change.
  5. Pro forma information is presented for the acquisition of the 51% interest of Universal Studios Japan. See Table 6 for more detailed information.

    All percentages are calculated on whole numbers. Minor differences may exist due to rounding.

Conference Call and Other Information

Comcast Corporation will host a conference call with the financial community today, January 26, 2017 at 8:30 a.m. Eastern Time (ET). The conference call and related materials will be broadcast live and posted on its Investor Relations website at www.cmcsa.com. Those parties interested in participating via telephone should dial (800) 263-8495 with the conference ID number 40819623. A replay of the call will be available starting at 12:00 p.m. ET on January 26, 2017, on the Investor Relations website or by telephone. To access the telephone replay, which will be available until Thursday, February 2, 2017 at midnight ET, please dial (855) 859-2056 and enter the conference ID number 40819623.

From time to time, we post information that may be of interest to investors on our website at www.cmcsa.com and on our corporate blog, http://corporate.comcast.com/comcast-voices. To automatically receive Comcast financial news by email, please visit www.cmcsa.com and subscribe to email alerts.

Caution Concerning Forward-Looking Statements

This press release contains forward-looking statements. Readers are cautioned that such forward-looking statements involve risks and uncertainties that could cause actual events or our actual results to differ materially from those expressed in any such forward-looking statements. Readers are directed to Comcast's periodic and other reports filed with the Securities and Exchange Commission (SEC) for a description of such risks and uncertainties. We undertake no obligation to update any forward-looking statements.

Non-GAAP Financial Measures

In this discussion, we sometimes refer to financial measures that are not presented according to generally accepted accounting principles in the U.S. (GAAP). Certain of these measures are considered "non-GAAP financial measures" under the SEC regulations; those rules require the supplemental explanations and reconciliations that are in Comcast's Form 8-K (Quarterly Earnings Release) furnished to the SEC.

About Comcast Corporation

Comcast Corporation (Nasdaq: CMCSA) is a global media and technology company with two primary businesses, Comcast Cable and NBCUniversal. Comcast Cable is one of the nation's largest video, high-speed Internet and phone providers to residential customers under the XFINITY brand and also provides these services to businesses. NBCUniversal operates news, entertainment and sports cable networks, the NBC and Telemundo broadcast networks, television production operations, television station groups, Universal Pictures and Universal Parks and Resorts. Visit www.comcastcorporation.com for more information.

                 
TABLE 1
Condensed Consolidated Statement of Income (Unaudited)                          
 
 
 
 
 
Three Months Ended Twelve Months Ended
(in millions, except per share data) December 31, December 31,
  2015     2016     2015     2016  
Revenue $ 19,245 $ 21,025 $ 74,510 $ 80,403
 
Programming and production 5,836 6,537 22,550 24,463
Other operating and administrative 5,581 6,129 21,319 23,409
Advertising, marketing and promotion   1,556     1,599     5,963     6,114  
  12,973     14,265     49,832     53,986  
 
Operating cash flow 6,272 6,760 24,678 26,417
 
Depreciation expense 1,776 1,946 6,781 7,464
Amortization expense   494     550     1,899     2,094  
  2,270     2,496     8,680     9,558  
Operating income 4,002 4,264 15,998 16,859
 
Other income (expense)
Interest expense (674 ) (756 ) (2,702 ) (2,942 )
Investment income (loss), net 57 45 81 213
Equity in net income (losses) of investees, net (123 ) (40 ) (325 ) (104 )
Other income (expense), net   (44 )   223     320     327  
  (784 )   (528 )   (2,626 )   (2,506 )
 
Income before income taxes 3,218 3,736 13,372 14,353
 
Income tax expense   (1,162 )   (1,319 )   (4,959 )   (5,308 )
 
Net income 2,056 2,417 8,413 9,045
 
Net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock (85 ) (121 ) (250 ) (350 )
       
Net income attributable to Comcast Corporation $ 1,971   $ 2,296   $ 8,163   $ 8,695  
 
 
Diluted earnings per common share attributable to Comcast Corporation shareholders $ 0.79   $ 0.95   $ 3.24   $ 3.57  
 
 
Dividends declared per common share $ 0.25   $ 0.275   $ 1.00   $ 1.10  
 
 
 
Diluted weighted-average number of common shares   2,481     2,410     2,518     2,438  
 
       
TABLE 2
Condensed Consolidated Balance Sheet (Unaudited)            
 
 
 
 
 
(in millions) December 31, December 31,
2015 2016
ASSETS
 
Current Assets
Cash and cash equivalents $ 2,295 $ 3,301
Receivables, net 6,896 7,955
Programming rights 1,213 1,250
Deposits 21 1,772
Other current assets   1,878   2,083
Total current assets   12,303   16,361
 
Film and television costs 5,855 7,252
 
Investments 3,224 5,247
 
Property and equipment, net 33,665 36,253
 
Franchise rights 59,364 59,364
 
Goodwill 32,945 35,980
 
Other intangible assets, net 16,946 17,274
 
Other noncurrent assets, net   2,272   2,769
 
$ 166,574 $ 180,500
 
LIABILITIES AND EQUITY
 
Current Liabilities
Accounts payable and accrued expenses related to trade creditors $ 6,215 $ 6,915
Accrued participations and residuals 1,572 1,726
Deferred revenue 1,302 1,132
Accrued expenses and other current liabilities 5,462 6,282
Current portion of long-term debt   3,627   5,480
Total current liabilities   18,178   21,535
 
Long-term debt, less current portion 48,994 55,566
 
Deferred income taxes 33,566 34,854
 
Other noncurrent liabilities 10,637 10,925
 
Redeemable noncontrolling interests and redeemable subsidiary preferred stock 1,221 1,446
 
Equity
Comcast Corporation shareholders' equity 52,269 53,943
Noncontrolling interests   1,709   2,231
Total equity   53,978   56,174
 
$ 166,574 $ 180,500
 
         
TABLE 3
Consolidated Statement of Cash Flows (Unaudited)              
 
 
 
 
 
(in millions) Twelve Months Ended
December 31,
  2015     2016  
 
OPERATING ACTIVITIES
Net income $ 8,413 $ 9,045
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 8,680 9,558
Share-based compensation 567 640
Noncash interest expense (income), net 205 230
Equity in net (income) losses of investees, net 325 104
Cash received from investees 168 85
Net (gain) loss on investment activity and other (318 ) (169 )
Deferred income taxes 958 1,444
Changes in operating assets and liabilities, net of effects of acquisitions and divestitures:
Current and noncurrent receivables, net (708 ) (782 )
Film and television costs, net (299 ) (495 )
Accounts payable and accrued expenses related to trade creditors 384 374
Other operating assets and liabilities   403     (794 )
 
Net cash provided by operating activities   18,778     19,240  
 
INVESTING ACTIVITIES
Capital expenditures (8,499 ) (9,135 )
Cash paid for intangible assets (1,370 ) (1,686 )
Acquisitions and construction of real estate properties (178 ) (428 )
Acquisitions, net of cash acquired (1,786 ) (3,929 )
Proceeds from sales of businesses and investments 433 218
Purchases of investments (784 ) (1,697 )
Deposits (18 ) (1,749 )
Other   238     21  
 
Net cash provided by (used in) investing activities   (11,964 )   (18,385 )
 
FINANCING ACTIVITIES
Proceeds from (repayments of) short-term borrowings, net 135 1,790
Proceeds from borrowings 5,486 9,231
Repurchases and repayments of debt (4,378 ) (3,052 )
Repurchases and retirements of common stock (6,750 ) (5,000 )
Dividends paid (2,437 ) (2,601 )
Issuances of common stock 36 23
Distributions to noncontrolling interests and dividends for redeemable subsidiary preferred stock (232 ) (253 )
Other   (289 )   13  
 
Net cash provided by (used in) financing activities   (8,429 )   151  
 
Increase (decrease) in cash and cash equivalents (1,615 ) 1,006
 
Cash and cash equivalents, beginning of period   3,910     2,295  
 
Cash and cash equivalents, end of period $ 2,295   $ 3,301  
 
 

TABLE 4

Reconciliations to Operating Cash Flow and Free Cash Flow and Alternate Presentation of Net Cash Provided by Operating Activities (Unaudited)

     

 

Three Months Ended

Twelve Months Ended

 

December 31,

December 31,
(in millions)   2015           2016     2015           2016  
Operating income $ 4,002 $ 4,264 $ 15,998 $ 16,859
Depreciation and amortization   2,270     2,496     8,680     9,558  
Operating income before depreciation and amortization (Operating Cash Flow) 6,272 6,760 24,678 26,417
Noncash share-based compensation expense 137 145 567 640
Changes in operating assets and liabilities   (375 )   92     (267 )   (1,782 )
Cash basis operating income 6,034 6,997 24,978 25,275
Payments of interest (529 ) (522 ) (2,443 ) (2,565 )
Payments of income taxes (581 ) (977 ) (3,726 ) (3,693 )
Excess tax benefits under share-based compensation (27 ) (40 ) (282 ) (233 )
Other   68     285     251     456  
Net Cash Provided by Operating Activities $ 4,965   $ 5,743   $ 18,778   $ 19,240  
Capital expenditures (2,637 ) (2,573 ) (8,499 ) (9,135 )
Cash paid for capitalized software and other intangible assets (454 ) (523 ) (1,370 ) (1,686 )
Principal payments on capital leases (11 ) (8 ) (17 ) (31 )
Distributions to noncontrolling interests and dividends for redeemable subsidiary preferred stock (54 ) (59 ) (232 ) (253 )
Nonoperating items(1)   282     50     277     242  
Free Cash Flow (including Economic Stimulus Packages) 2,091 2,630 8,937 8,377
Economic Stimulus Packages(1)   (503 )   (23 )   (2 )   (174 )
Total Free Cash Flow $ 1,588   $ 2,607   $ 8,935   $ 8,203  
 
Alternate Presentation of Free Cash Flow (Unaudited)                            
 

 

Three Months Ended

Twelve Months Ended

 

December 31,

December 31,
  2015     2016     2015     2016  
(in millions)
Operating Cash Flow $ 6,272 $ 6,760 $ 24,678 $ 26,417
Capital expenditures (2,637 ) (2,573 ) (8,499 ) (9,135 )
Cash paid for capitalized software and other intangible assets (454 ) (523 ) (1,370 ) (1,686 )
Cash interest expense (529 ) (522 ) (2,443 ) (2,565 )
Cash taxes on operating items (including Economic Stimulus Packages)(2) (326 ) (967 ) (3,731 ) (3,830 )
Changes in operating assets and liabilities(3) (375 ) 92 (267 ) (1,636 )
Noncash share-based compensation 137 145 567 640
Distributions to noncontrolling interests and dividends for redeemable subsidiary preferred stock (54 ) (59 ) (232 ) (253 )
Other   57     277     234     425  
Free Cash Flow (including Economic Stimulus Packages) 2,091 2,630 8,937 8,377
Economic Stimulus Packages(2)   (503 )   (23 )   (2 )   (174 )
Total Free Cash Flow $ 1,588   $ 2,607   $ 8,935   $ 8,203  
 
 
 
(1) Nonoperating items include adjustments for cash taxes paid related to certain investing and financing transactions and to reflect cash taxes paid in the year of the related taxable income. Our definition of Free Cash Flow specifically excludes any impact from the Economic Stimulus Packages and these amounts are presented separately. Net Cash Provided by Operating Activities for year to date 2016 includes a $146 million payment for the settlement of a tax receivable agreement immediately after the DreamWorks acquisition. For Free Cash Flow purposes, we consider this payment to be nonrecurring in nature and therefore, we excluded this amount from Free Cash Flow as a nonoperating item.
 
(2) Cash taxes on operating items (including Economic Stimulus Packages) has been adjusted to include the impact of excess tax benefits under share-based compensation arrangements and to exclude the impact of nonoperating items. Nonoperating items include adjustments for cash taxes paid related to certain investing and financing transactions and to reflect cash taxes paid in the year of the related taxable income. Our definition of Free Cash Flow specifically excludes any impact from the Economic Stimulus Packages and these amounts are presented separately.
         
Three Months Ended Twelve Months Ended

 

December 31,

December 31,
2015   2016 2015   2016
Payments of income taxes ($581 ) ($977 ) ($3,726 ) ($3,693 )
Excess tax benefits under share-based compensation (27 ) (40 ) (282 ) (233 )
Nonoperating items 282   50   277   96  
Cash taxes on operating items (including Economic Stimulus Packages) ($326 ) ($967 ) ($3,731 ) ($3,830 )
 
(3) Net Cash Provided by Operating Activities in our Consolidated Statement of Cash Flows for year to date 2016 includes a $146 million decrease resulting from a payment for the settlement of a tax receivable agreement immediately after the DreamWorks acquisition. For Free Cash Flow purposes, we consider this payment to be nonrecurring in nature and therefore, we excluded the amount from Free Cash Flow. Because the amount has no impact on Free Cash Flow, it is not included in the changes in operating assets and liabilities for this presentation.
 

Note: Minor differences may exist due to rounding.

 
                           
TABLE 5
Reconciliation of EPS Excluding Adjustments (Unaudited)
 
Three Months Ended Twelve Months Ended
December 31, December 31,
 
2015 2016 2015 2016
(in millions, except per share data)
$     EPS (1) $     EPS (1) $     EPS (1) $     EPS (1)
 
Net income attributable to Comcast Corporation $1,971 $0.79 $2,296 $0.95 $8,163 $3.24 $8,695 $3.57
Growth % 16.5% 20.3% 6.5% 10.2%
 
Income from agency agreement(2) - - (143) (0.06) - - (143) (0.06)
Gains on sales of businesses and investments(3) - - - - (202) (0.08) (67) (0.03)
Gain on settlement of contingent consideration liability(4) - - - - (150) (0.06) - -
Loss on early redemption of debt(5) - - - - 29 0.01 - -
Costs related to Time Warner Cable and Charter transactions(6) - - - - 123 0.05 - -
Losses on investment(7) 50 0.02 - - 208 0.09 - -
                       
Net income attributable to Comcast Corporation (excluding adjustments) $2,021   $0.81 $2,153   $0.89 $8,171   $3.25 $8,485   $3.48
Growth % 6.5% 9.9% 3.9% 7.1%
 
(1)   Based on pre-split diluted weighted-average number of common shares for the respective periods as presented in Table 1.
 
(2) 4th quarter 2016 net income attributable to Comcast Corporation includes $225 million of other income, $143 million net of tax, recognized in connection with the settlement of amounts owed to us under an agency agreement that provided for, among other things, the sale of our cable services by a third party.
 
(3) 2016 year to date net income attributable to Comcast Corporation includes $108 million of other income, $67 million net of tax, resulting from a gain on the sale of our investment in The Weather Channel's product and technology business. 2015 year to date net income attributable to Comcast Corporation includes $335 million of other income, $202 million net of tax and noncontrolling interests, resulting from sales of an investment and a business.
 
(4) 2015 year to date net income attributable to Comcast Corporation includes $240 million of other income, $150 million net of tax, resulting from the settlement of a contingent consideration liability with General Electric Company related to the acquisition of NBCUniversal.
 
(5) 2015 year to date net income attributable to Comcast Corporation includes $47 million of interest expense, $29 million net of tax, resulting from the early redemption of debt.
 
(6) 2015 year to date net income attributable to Comcast Corporation includes $198 million of expense ($178 million of operating costs and expenses and $20 million of depreciation and amortization expense), $123 million net of tax, related to the Time Warner Cable and Charter transactions.
 
(7) 4th quarter 2015 net income attributable to Comcast Corporation includes $81 million of equity in net losses of investees, $50 million net of tax, resulting from our proportionate share of an impairment loss recorded at The Weather Channel. 2015 year to date net income attributable to Comcast Corporation includes $333 million of equity in net losses of investees, $208 million net of tax, resulting from our proportionate share of impairment losses recorded at The Weather Channel.
 
 

Note: Minor differences may exist due to rounding.

 
                       
TABLE 6
Reconciliation of As Reported to Pro Forma(1) Financial Information (Unaudited)
 
 

Theme Parks

NBCUniversal

 
(in millions)

As Reported

Pro Forma
Adjustments
(1)

Pro Forma
Theme Parks

As Reported

Pro Forma
Adjustments
(1)

Pro Forma
NBCUniversal

Three Months Ended December 31, 2015

 
Revenue $ 1,019 $ 170 $ 1,189 $ 7,477 $ 170 $ 7,647
 
Operating costs and expenses   567     81   648     5,925     81   6,006  
 
Operating cash flow $ 452   $ 89 $ 541   $ 1,552   $ 89 $ 1,641  
 
 

Three Months Ended December 31, 2016

 
Revenue $ 1,344 - $ 1,344 $ 8,451 - $ 8,451
 
Operating costs and expenses   704     -   704     6,681     -   6,681  
 
Operating cash flow $ 640     - $ 640   $ 1,770     - $ 1,770  
 

Growth Rates

Revenue 32.1 % 13.2 % 13.0 % 10.5 %
Operating cash flow 41.9 % 18.4 % 14.0 % 7.8 %
                                     
 

Twelve Months Ended December 31, 2015

 
Revenue $ 3,339 $ 1,052 $ 4,391 $ 28,462 $ 1,052 $ 29,514
 
Operating costs and expenses   1,875     564   2,439     22,110     564   22,674  
 
Operating cash flow $ 1,464   $ 488 $ 1,952   $ 6,352   $ 488 $ 6,840  
 

Twelve Months Ended December 31, 2016

 
Revenue $ 4,946 - $ 4,946 $ 31,593 - $ 31,593
 
Operating costs and expenses   2,756     -   2,756     24,366     -   24,366  
 
Operating cash flow $ 2,190     - $ 2,190   $ 7,227     - $ 7,227  
 

Growth Rates

Revenue 48.2 % 12.7 % 11.0 % 7.0 %
Operating cash flow 49.6 % 12.2 % 13.8 % 5.7 %
 
(1) Pro Forma information is presented as if the acquisition of the 51% interest of Universal Studios Japan occurred on January 1, 2014. Pro forma data does not include adjustments for transaction-related costs, costs related to integration activities, or cost savings or synergies that have been or may be achieved by the combined businesses. The pro forma amounts are primarily based on historical results of operations, adjusted for the allocation of purchase price and are not necessarily indicative of what our results would have been had we operated Universal Studios Japan since January 1, 2014, nor of our future results.
 
               
TABLE 7
Reconciliation of Consolidated Revenue Excluding 2016 Olympics and 2015 Super Bowl and Operating Cash Flow Excluding Costs Related to

Time Warner Cable and Charter Transactions (Unaudited)

 
Three Months Ended Twelve Months Ended
December 31, December 31,
 
(in millions) 2015 2016 Growth % 2015 2016 Growth %
 
Revenue $19,245 $21,025 9.2% $74,510 $80,403 7.9%
 
2016 Olympics - - - (1,620)
2015 Super Bowl - - (376) -
 
Revenue excluding 2016 Olympics and 2015 Super Bowl $19,245 $21,025 9.2% $74,134 $78,783 6.3%
 
 
2015 2016 Growth % 2015 2016 Growth %
 
Operating Income $4,002 $4,264 $15,998 $16,859
 
Depreciation and Amortization 2,270 2,496 8,680 9,558
       
Operating Cash Flow $6,272 $6,760 7.8% $24,678 $26,417 7.0%
 
Costs related to Time Warner Cable and Charter transactions - - 178 -
 
Operating Cash Flow excluding costs related to Time Warner Cable and Charter transactions $6,272 $6,760 7.8% $24,856 $26,417 6.3%
 
Reconciliation of Consolidated NBCUniversal Revenue Excluding 2016 Olympics and 2015 Super Bowl (Unaudited)
 
Three Months Ended Twelve Months Ended
December 31, December 31,
 
(in millions) 2015 2016 Growth % 2015 2016 Growth %
 
Revenue $7,477 $8,451 13.0% $28,462 $31,593 11.0%
 
2016 Olympics - - - (1,620)
2015 Super Bowl - - (376) -
 
Revenue excluding 2016 Olympics and 2015 Super Bowl $7,477 $8,451 13.0% $28,086 $29,973 6.7%
 
Reconciliation of Consolidated NBCUniversal Pro Forma Revenue Excluding 2016 Olympics and 2015 Super Bowl (Unaudited)
 
 
Three Months Ended Twelve Months Ended
December 31, December 31,
 
(in millions) 2015 2016 Growth % 2015 2016 Growth %
 
Pro Forma Revenue $7,647 $8,451 10.5% $29,514 $31,593 7.0%
 
2016 Olympics - - - (1,620)
2015 Super Bowl - - (376) -
 
Pro Forma Revenue excluding 2016 Olympics and 2015 Super Bowl $7,647 $8,451 10.5% $29,138 $29,973 2.9%
 
Reconciliation of Cable Networks Revenue Excluding 2016 Olympics (Unaudited)
 
Three Months Ended Twelve Months Ended
December 31, December 31,
 
(in millions) 2015 2016 Growth % 2015 2016 Growth %
 
Revenue $2,407 $2,503 4.0% $9,628 $10,464 8.7%
 
2016 Olympics - - - (432)
 
Revenue excluding 2016 Olympics $2,407 $2,503 4.0% $9,628 $10,032 4.2%
 
 
Reconciliation of Broadcast Television Revenue Excluding 2016 Olympics and 2015 Super Bowl (Unaudited)
 
Three Months Ended Twelve Months Ended
December 31, December 31,
 
(in millions) 2015 2016 Growth % 2015 2016 Growth %
 
Revenue $2,498 $2,848 14.0% $8,530 $10,147 19.0%
 
2016 Olympics - - - (1,188)
2015 Super Bowl - - (376) -
 
Revenue excluding 2016 Olympics and 2015 Super Bowl $2,498 $2,848 14.0% $8,154 $8,959 9.9%
 
 

Note: Minor differences may exist due to rounding.

Comcast Corporation
Investor Contacts:
Jason Armstrong, 215-286-7972
Jane Kearns, 215-286-4794
or
Press Contacts:
D'Arcy Rudnay, 215-286-8582
John Demming, 215-286-8011

Source: Comcast Corporation

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