Comcast's Q4 Outlook: Peacock's Growth and Broadband Subscriber Losses

Comcast Corporation (CMCSA), a leading global media and technology company, is expected to release its fiscal Q4 earnings results before the market opens on Thursday, Jan. 30. Analysts anticipate a profit of $0.88 per share, up 4.8% from $0.84 per share in the year-ago quarter. The company has surpassed Wall Street's bottom-line estimates in the last four quarters, with CMCSA exceeding the consensus EPS estimate by 5.7% in the most recent quarter.



Comcast's Q4 performance is expected to be driven by several key factors, including the growth of its streaming service, Peacock, and the impact of broadband subscriber losses. In the third quarter of 2024, Peacock's revenues surged 82% year-over-year to $1.5 billion, with a 29% increase in paid subscribers to 36 million. This strong performance in the streaming segment helped offset declines in other segments, such as Theme Parks. Analysts expect Peacock's growth to continue in the fourth quarter, contributing to Comcast's overall earnings.

However, Comcast's broadband subscriber losses are expected to impact its Q4 results. The company projects a loss of 100,000 broadband customers in the fourth quarter of 2024, reflecting the kind of losses the operator saw in the first half of the year. This loss is higher than the 65,000 loss that analysts were expecting. Comcast's shares were down $3.80 (-8.79%) to $39.35 each in Monday afternoon trading, reflecting investor concerns about the subscriber losses.

Comcast's broadband subscriber losses can be attributed to several factors, including intense competition in the broadband market and the impact of Hurricanes Helene and Milton, which resulted in about 10,000 subscriber losses in Q4. Additionally, the demise of the Affordable Connectivity Program (ACP) contributed to broadband subscriber losses in Q3, with Comcast losing about 9,000 broadband subscribers due to the program's end.



Comcast's broadband subscriber losses are expected to impact its average revenue per unit (ARPU) in Q4, with the company expecting ARPU to rise again in Q4 but come in at the lower end of its anticipated range of 3% to 4%. This is due to the loss of higher-paying customers and the need to offer promotions and discounts to retain customers.

Comcast's broadband subscriber losses are also expected to impact its total customer relationships, with the company expecting a decrease of 71,000 to 34.293 million in Q4. This decrease is primarily due to the loss of broadband customers, as well as a decrease in video and voice customers.

In conclusion, Comcast's Q4 performance is expected to be driven by the growth of its streaming service, Peacock, and the impact of broadband subscriber losses. While Peacock's strong performance is expected to contribute to Comcast's overall earnings, broadband subscriber losses are expected to have a negative impact on the company's Q4 results. Investors will be closely watching Comcast's earnings report to assess the company's performance and outlook for the coming year.