How Will Comcast’s NBCUniversal Business Fare in 2016?



Comcast’s NBCUniversal Broadcast Television segment

Comcast (CMCSA) continues to remain aggressive in its broadcasting of sports programming. The company stated on its 4Q15 and 2015 earnings call that it considered the broadcast of football games to be extremely profitable. It believes that these games are excellent opportunities for its advertisers to target a broad audience.

Early this year, Comcast’s NBCUniversal and CBS (CBS) acquired the sports broadcasting rights to telecast five Thursday Night Football games each. The National Football League will expand the Thursday Night Football package to ten games in 2016 and 2017.

As the graph above indicates, advertising made up 67%, or $5.7 billion, of the Broadcast Television segment’s total revenues of $8.5 billion in 2015. Comcast’s

NBCUniversal Broadcast television segment also saw retransmission revenue of $535 million in 2015. Comcast expects retransmission revenue to be about $800 million in 2016.

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Filmed Entertainment segment

In 2016, Comcast’s Universal Pictures will not have as strong a slate as it did in 2015, but the company notes that it still has a “strategic slate of core franchises, sequels and animated films.” Universal Pictures had its most profitable year in 2015, with total revenues of $7.3 billion.

By contrast, 21st Century Fox’s (FOXA) Filmed Entertainment segment saw revenue of $2.4 billion in fiscal 2Q16, a fall of $392 million over its fiscal 2Q15.

Theme Parks segment

In 2016, Comcast will open a Harry Potter theme park in Hollywood, and it plans to integrate Universal Studios Japan (EWJ) into its Theme Parks portfolio.

Comcast expects its capital expenditure to rise by about 10% in 2016 for its NBCUniversal businesses. Comcast plans to continue to invest in its theme parks as well as in the consolidation of Universal Studios Japan. During 3Q15, Comcast acquired a 51% stake in Universal Studios Japan.

21st Century Fox makes up 0.64% of the PowerShares QQQ ETF (QQQ). QQQ has a 12% exposure to the computers sector and holds 0.78% in Netflix (NFLX).


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