What Seasonal and Cyclical Factors Impact NBCUniversal?

The advertising revenues for Comcast’s (CMCSA) NBCUniversal Cable Networks and Broadcasting Television business are susceptible to advertising cyclicality and program ratings. The advertising revenues in these segments are generally on the higher side in the second and fourth quarter due to the increased advertising during the spring and the holiday season.

Advertising also fluctuates for these businesses in case of significant events. For example, during the US presidential elections or major sporting events, advertising revenues are higher as advertisers tend to seek out more consumers during such broadcasts. As a result, there is increased demand for advertising slots during such events.

However, operating costs also increase during the telecast of important events, as programming and production costs also tend to rise.

As the chart above indicates, the NBC Universal Cable Networks advertising quarter-over-quarter revenue growth has been positive in the second and fourth quarter while being negative in the remaining quarters.

Filmed Entertainment revenues are heavily influenced by the timing of the company’s movie releases in theatres, on home entertainment platforms, and on digital platforms. Usually, revenues are high during the summer or during the holiday season as more people go to theatres. Revenues also tend to be affected by the timing of a movie that is made available to a third party or a licensee for distribution.

Revenues for the theme parks business are affected by vacation periods, local entertainment options, and changes in weather. Usually, theme park attendance and per capita guest spending is higher during summer vacation and holiday season.

Comcast makes up 2.6% of the PowerShares QQQ Trust Series 1 ETF (QQQ). QQQ has 4.4% exposure to the television and radio sector. QQQ also invests 4.8% of its holdings in Alphabet (GOOG), 5.9% in Amazon (AMZN), and 4.5% in Facebook (FB).