Comcast’s profit drops as coronavirus hits NBCUniversal division

Cable giant Comcast reported nearly a 40 percent dip in first-quarter profit Thursday as the economic fallout from the coronavirus hit NBCUniversal’s theme parks and film divisions.

Comcast shares fell  over 5 percent in early-market trading after the company said during its earnings call that it would lose about $500 million if theme parks remained closed through June and that advertising will be down “significantly” in the second quarter.

Comcast Chairman and Chief Executive Brian Roberts said costs in its large cable business had ramped up due to more consumers working from home, and added that NBCU and Sky “will be negatively impacted to a greater extent” in the second quarter 2020, as advertising continues to slump.

One bright spot was Comcast’s cable revenue, which increased 4.5 percent, to $14.9 billion, driven largely by increases in the use of its high-speed internet, business services and wireless products. Yet even as the Philadelphia-based firm added 477,000 high-speed internet customers, it lost 409,000 video subscribers.

Meanwhile, NBCUniversal’s revenue fell 7 percent, to $7.7 billion, with decreases coming in advertising revenue at both broadcast and cable networks, theatrical revenue at its film business due to production delays and movie theater closures, and declines at its theme parks due to closures in both Japan and the US. Filmed entertainment revenue was off 22.5 percent while theme park revenue fell 31.9 percent, the company said.

Overall, for the quarter, Comcast saw its profit decline 39.6 percent to $2.15 billion, or 46 cents a share. Adjusted EPS totaled 71 cents. Revenue slid 0.9 percent, to $26.6 billion.

Wall Street was looking for EPS of 68 cents on sales of  $26.75 billion

“We have a strong balance sheet, terrific portfolio of assets, and a world-class management team,” Roberts said in a statement. “This is a moment in time; and when it passes, I am very confident that the decisions we are making now will enable us to emerge from this crisis as a healthy, strong company that is well positioned to continue to grow and succeed.”

Nonetheless, Roberts said that the pandemic’s effects will likely “increase in significance in the second quarter 2020” and  and “have a material adverse impact on our consolidated results of operations over the near-to-medium term.”

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