Comcast's Q3 2025 Earnings Call: Contradictions Emerge in Wireless Strategy, ARPU, and Cost Management Approaches

Date of Call: October 30, 2025

Financials Results

• Revenue: Total company revenue declined about 3% year-over-year; excluding the Paris Olympics impact, revenue increased nearly 3% year-over-year.
• EPS: Adjusted EPS was consistent with prior year (no dollar figure provided).

Guidance:

• Connectivity & Platforms EBITDA expected to face pressure over the next several quarters as investments in pricing, product and customer experience continue.
• Broadband ARPU expected to step down more than 1 point in Q4; company does not plan a broadband rate increase in the early part of 2026.
• Many free wireless lines will be monetized in the second half of next year; the company intends to convert the majority to paying lines.
• NBA rights amortization will create upfront Media EBITDA dilution in the first season; advertising growth is expected to offset this over time.
• Epic Universe to scale attendance and operating leverage over the next year as ride throughput is increased.

Business Commentary:

• Connectivity & Platforms Pivot and Revenue Management:
• Comcast's Connectivity & Platforms saw a 3.7% decline in EBITDA for Q3 2025 due to market repositioning.

• The decline is attributed to deliberate investments in pricing simplification, customer experience, and strategic product innovation, which are expected to stabilize broadband churn and enhance long-term revenue growth.

• Broadband and Wireless Subscriber Trends:

• Broadband subscribers declined by 104,000 in Q3, while wireless net additions reached a record 414,000.

• The broadband decline reflects an intense competitive environment, while wireless growth is supported by promotional offerings and product enhancements.

• Content and Media Performance:

• Parks revenue increased by 19%, driven by the first full quarter of Epic Universe operations.

• Media revenue, excluding Olympic comparisons, grew a healthy 4%, with Peacock seeing mid-teens revenue growth due to strong advertising and distribution revenue.

• Leadership Transition and Strategic Focus:

• Steve Croney was appointed CEO of the Connectivity & Platforms business, with Dave Watson becoming Vice Chairman.
• This transition is part of a broader strategic focus on convergence and product integration to compete more effectively in the market.

Sentiment Analysis:

Overall Tone: Neutral

• Company highlighted near-term headwinds: Connectivity & Platforms EBITDA down 3.7% this quarter and total revenue down ~3% YOY, yet noted strengths: record wireless net adds (414k), free cash flow up 45% to $4.9B, Parks +19% revenue and Peacock improvements—illustrating a mixed near-term outlook with positive long-term positioning.

Q&A:

• Question from Michael Rollins (Citigroup Inc., Research Division): Could you share more context around the evolution of ARPU, customers migrating to the new plans and opportunities to build better retention versus the revenue cost; and on convergence, do you expect the 2.5% growth rate to improve over time as you market new offers and promotions?
  Response: Near-term ARPU will be pressured by migration to simpler pricing and free wireless offers (unlikely to grow in early 2026), but these moves are deliberate to improve retention and drive longer-term convergence revenue as free lines monetize.

• Question from Michael Ng (Goldman Sachs Group, Inc., Research Division): Could you discuss the trajectory of C&P EBITDA next year and the OpEx investments (CPE, sales, marketing, customer service) supporting the reset?
  Response: C&P will incur near-term OpEx headwinds—increased investment in marketing, sales channels, CPE and customer experience—partly offset by ongoing cost rationalization; expect EBITDA pressure in the coming quarters.

• Question from Craig Moffett (MoffettNathanson LLC): Thoughts on potential Warner Bros. Discovery assets (complementarity and political/transaction feasibility) and whether Verizon's leadership change affects your MVNO relationship?
  Response: The bar for M&A is high; focus remains on strengthening current assets (including the VERSANT spin) though selective opportunities will be evaluated; relationship with Verizon remains important and is expected to continue successfully.

• Question from Benjamin Swinburne (Morgan Stanley, Research Division): How are you thinking about converting free wireless lines to paying next year and ensuring customer quality; and what should we expect on Epic (ride throughput/operating leverage) in 2026?
  Response: Free-line strategy targets higher-quality customers supported by new premium unlimited plans and active migration efforts to convert lines next year; Epic will ramp ride throughput and scale to drive higher attendance, per-cap spending and operating leverage over the next year.

• Question from Jessica Reif Cohen (BofA Securities, Research Division): Plans to scale Peacock globally and need for M&A; and please drill into the advertising outlook, including programmatic trends?
  Response: Management does not see M&A as necessary to scale—NBCU's content, sports and talent plus the VERSANT spin position the business well; advertising is healthy (up ~3% ex-Olympics) with strong sports-driven demand and growing programmatic/digital adoption benefiting Peacock.

• Question from John Hodulik (UBS Investment Bank, Research Division): Is there evidence wireless/convergence is lowering broadband churn and is the free line promotion helping new connects; and how do you view competition and trends in the Business Services market?
  Response: Adding wireless reduces broadband churn and the free-line promotion is a longer-term churn and monetization play with conversion-focus next year; Business Services remain competitive (fixed wireless pressure) but show solid growth and upside via advanced services and mobile.

Contradiction Point 1

Wireless Growth Strategy and Impact on ARPU

It highlights differing perspectives on the strategic impact of wireless offerings on ARPU and the broadband customer experience, which are critical for revenue growth and investor expectations.

Can you elaborate on the evolution of broadband ARPU and the migration to new plans? Can you discuss the trajectory of convergence revenue growth? - Michael Rollins (Citigroup Inc., Research Division)

2025Q3: Transition period involves deliberate investments, with expected ARPU pressure in the short term. Wireless lines, especially free lines, are seen as positive long-term growth factors. - Jason Armstrong(CFO)

How does everyday pricing affect ARPU growth and seasonal trends in broadband? - Michael Ng (Goldman Sachs Group, Inc.)

2025Q2: ARPU growth expected to moderate, but long-term healthy ARPU growth anticipated. Convergence revenue expected to see pressure, but setting up for reacceleration. - Jason S. Armstrong(CFO)

Contradiction Point 2

ARPU and Broadband Pricing Strategy

It involves differing statements about the company's strategy for Average Revenue Per User (ARPU) growth and broadband pricing, which are key financial performance indicators.

What is the evolution of ARPU for broadband and the migration to new plans? What is the growth trajectory of convergence revenue? - Michael Rollins(Citigroup Inc., Research Division)

2025Q3: The plan is to not increase broadband rates in early 2026, but focus on migrating customers to new, less expensive packages, offering key benefits like free mobile lines. - David Watson(CEO)

What are the key drivers of broadband ARPU growth, and how will new pricing and packaging changes affect long-term ARPU growth? - Michael Ng(Goldman Sachs)

2025Q1: Broadband ARPU growth is driven by our strategies to simplify pricing and enhance the customer experience. We aim for sustainable growth by focusing on long-term customer satisfaction rather than broad repricing. - David Watson(CEO)

Contradiction Point 3

Investment and Cost Management

It highlights differing views on the company's approach to investment and cost management, which are crucial for operational efficiency and financial performance.

Could you discuss the Connectivity & Platforms investments in CPE, sales, marketing, and customer service to support the reset? - Michael Ng(Goldman Sachs Group, Inc., Research Division)

2025Q3: The company is focused on cost rationalization, but investments in the strategic pivot are a priority. - Jason Armstrong(CFO)

What are the expected Peacock losses for the rest of 2025? What is the outlook for the cable connectivity business pivot over the next few quarters? - Ben Swinburne(Morgan Stanley, Research Division)

2025Q1: While we are focused on cost efficiency, we have not meaningfully reduced our investments in the connectivity and platforms segment. - Jason Armstrong(CFO)

Contradiction Point 4

Broadband ARPU Strategy and Convergence Revenue Growth

It involves differing strategies and expectations for broadband ARPU growth and the role of convergence revenue growth, which are crucial factors in understanding the company's financial performance and growth strategy.

Can you explain the evolution of broadband ARPU and the migration to new plans? Could you discuss the trajectory of convergence revenue growth? - Michael Rollins (Citigroup Inc., Research Division)

2025Q3: The plan is to not increase broadband rates in early 2026, but focus on migrating customers to new, less expensive packages, offering key benefits like free mobile lines. The goal is to maintain long-term revenue growth. - David Watson

What is the outlook for ARPU in domestic broadband and free cash flow next year? - Michael Ng (Goldman Sachs Group, Inc., Research Division)

2024Q4: We expect healthy ARPU growth with various levers to maximize revenue growth, despite the mobile focus. - David Watson

Contradiction Point 5

Customer Experience and Churn Reduction

It involves differing statements about the impact of wireless convergence on customer churn and retention, which are crucial for broadband subscriber growth and retention strategies.

Is wireless convergence reducing broadband churn, and how does business services competition impact trends? - John Hodulik (UBS Investment Bank, Research Division)

2025Q3: Wireless addition positively impacts churn. - David Watson

What is the competitive landscape for broadband and its impact on future quarterly performance improvements? - Michael Ian Rollins (Citigroup)

2025Q2: The competitive landscape remains intense with fixed wireless and fiber competitors. Half of eligible new customer connects selected the 5-year price guarantee. 20% increase in premium gig speed choices. The early results are encouraging. - David N. Watson(Executive Vice President of Connectivity & Platforms)