filings.toolsItem 1. FINANCIAL STATEMENTS
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Item 1. FINANCIAL STATEMENTS
Comcast Corporation
Condensed Consolidated Statement of Income
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions, except per share data) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
| Revenue | $ | 29,849 | $ | 30,298 | $ | 90,874 | $ | 86,049 | |||||||||||||||
| Costs and Expenses: | |||||||||||||||||||||||
| Programming and production | 8,949 | 10,395 | 28,406 | 28,570 | |||||||||||||||||||
| Other operating and administrative | 9,344 | 8,981 | 27,701 | 25,799 | |||||||||||||||||||
| Advertising, marketing and promotion | 2,066 | 1,995 | 6,324 | 5,462 | |||||||||||||||||||
| Depreciation | 2,150 | 2,177 | 6,525 | 6,407 | |||||||||||||||||||
| Amortization | 1,183 | 1,301 | 3,824 | 3,815 | |||||||||||||||||||
| Goodwill and long-lived asset impairments | 8,583 | — | 8,583 | — | |||||||||||||||||||
| Total costs and expenses | 32,274 | 24,848 | 81,363 | 70,053 | |||||||||||||||||||
| Operating income (loss) | (2,425) | 5,450 | 9,511 | 15,996 | |||||||||||||||||||
| Interest expense | (960) | (1,050) | (2,922) | (3,161) | |||||||||||||||||||
| Investment and other income (loss), net | (266) | 766 | (975) | 2,374 | |||||||||||||||||||
| Income (loss) before income taxes | (3,652) | 5,166 | 5,614 | 15,208 | |||||||||||||||||||
| Income tax expense | (1,014) | (1,235) | (3,562) | (4,354) | |||||||||||||||||||
| Net income (loss) | (4,665) | 3,931 | 2,052 | 10,854 | |||||||||||||||||||
| Less: Net income (loss) attributable to noncontrolling interests | (68) | (104) | (295) | (249) | |||||||||||||||||||
| Net income (loss) attributable to Comcast Corporation | $ | (4,598) | $ | 4,035 | $ | 2,347 | $ | 11,102 | |||||||||||||||
| Basic earnings (loss) per common share attributable to Comcast Corporation shareholders | $ | (1.05) | $ | 0.88 | $ | 0.53 | $ | 2.42 | |||||||||||||||
| Diluted earnings (loss) per common share attributable to Comcast Corporation shareholders | $ | (1.05) | $ | 0.86 | $ | 0.52 | $ | 2.38 | |||||||||||||||
See accompanying notes to condensed consolidated financial statements.
Comcast Corporation
Condensed Consolidated Statement of Comprehensive Income
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
| Net income (loss) | $ | (4,665) | $ | 3,931 | $ | 2,052 | $ | 10,854 | |||||||||||||||
| Currency translation adjustments, net of deferred taxes of $15, $231, $304 and $122 | (2,464) | (692) | (6,337) | (666) | |||||||||||||||||||
| Cash flow hedges: | |||||||||||||||||||||||
| Deferred gains (losses), net of deferred taxes of $4, $1, $(34) and $(16) | 108 | 46 | 401 | 151 | |||||||||||||||||||
| Realized (gains) losses reclassified to net income, net of deferred taxes of $(10), $(7), $(26) and $(7) | (56) | (9) | (118) | (5) | |||||||||||||||||||
| Employee benefit obligations and other, net of deferred taxes of $9, $2, $14 and $7 | (29) | (8) | (50) | (25) | |||||||||||||||||||
| Comprehensive income (loss) | (7,106) | 3,268 | (4,053) | 10,309 | |||||||||||||||||||
| Less: Net income (loss) attributable to noncontrolling interests | (68) | (104) | (295) | (249) | |||||||||||||||||||
| Less: Other comprehensive income (loss) attributable to noncontrolling interests | (56) | 2 | (68) | 11 | |||||||||||||||||||
| Comprehensive income (loss) attributable to Comcast Corporation | $ | (6,983) | $ | 3,370 | $ | (3,689) | $ | 10,546 |
See accompanying notes to condensed consolidated financial statements.
Comcast Corporation
Condensed Consolidated Statement of Cash Flows
(Unaudited)
| Nine Months Ended September 30, | |||||||||||
| (in millions) | 2022 | 2021 | |||||||||
| Operating Activities | |||||||||||
| Net income | $ | 2,052 | $ | 10,854 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 10,349 | 10,222 | |||||||||
| Goodwill and long-lived asset impairments | 8,583 | — | |||||||||
| Share-based compensation | 989 | 1,019 | |||||||||
| Noncash interest expense (income), net | 234 | 287 | |||||||||
| Net (gain) loss on investment activity and other | 1,172 | (1,953) | |||||||||
| Deferred income taxes | (326) | 2,087 | |||||||||
| Changes in operating assets and liabilities, net of effects of acquisitions and divestitures: | |||||||||||
| Current and noncurrent receivables, net | (574) | (720) | |||||||||
| Film and television costs, net | (753) | (541) | |||||||||
| Accounts payable and accrued expenses related to trade creditors | 152 | 667 | |||||||||
| Other operating assets and liabilities | (1,347) | (465) | |||||||||
| Net cash provided by operating activities | 20,530 | 21,457 | |||||||||
| Investing Activities | |||||||||||
| Capital expenditures | (7,062) | (6,146) | |||||||||
| Cash paid for intangible assets | (2,152) | (2,006) | |||||||||
| Construction of Universal Beijing Resort | (221) | (825) | |||||||||
| Acquisitions, net of cash acquired | (1) | (167) | |||||||||
| Proceeds from sales of businesses and investments | 1,197 | 500 | |||||||||
| Purchases of investments | (2,089) | (122) | |||||||||
| Other | 170 | 359 | |||||||||
| Net cash provided by (used in) investing activities | (10,158) | (8,406) | |||||||||
| Financing Activities | |||||||||||
| Proceeds from borrowings | 166 | 2,515 | |||||||||
| Repurchases and repayments of debt | (301) | (9,041) | |||||||||
| Repurchases of common stock under repurchase program and employee plans | (9,813) | (2,617) | |||||||||
| Dividends paid | (3,571) | (3,387) | |||||||||
| Other | 219 | (416) | |||||||||
| Net cash provided by (used in) financing activities | (13,299) | (12,946) | |||||||||
| Impact of foreign currency on cash, cash equivalents and restricted cash | (122) | (15) | |||||||||
| Increase (decrease) in cash, cash equivalents and restricted cash | (3,049) | 90 | |||||||||
| Cash, cash equivalents and restricted cash, beginning of period | 8,778 | 11,768 | |||||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 5,729 | $ | 11,858 |
See accompanying notes to condensed consolidated financial statements.
Comcast Corporation
Condensed Consolidated Balance Sheet
(Unaudited)
| (in millions, except share data) | September 30, 2022 | December 31, 2021 | |||||||||
| Assets | |||||||||||
| Current Assets: | |||||||||||
| Cash and cash equivalents | $ | 5,695 | $ | 8,711 | |||||||
| Receivables, net | 11,918 | 12,008 | |||||||||
| Other current assets | 5,803 | 4,088 | |||||||||
| Total current assets | 23,416 | 24,807 | |||||||||
| Film and television costs | 12,685 | 12,806 | |||||||||
| Investments | 7,318 | 8,082 | |||||||||
| Investment securing collateralized obligation | 539 | 605 | |||||||||
| Property and equipment, net of accumulated depreciation of $56,638 and $55,611 | 53,555 | 54,047 | |||||||||
| Goodwill | 56,414 | 70,189 | |||||||||
| Franchise rights | 59,365 | 59,365 | |||||||||
| Other intangible assets, net of accumulated amortization of $25,446 and $23,545 | 28,604 | 33,580 | |||||||||
| Other noncurrent assets, net | 12,411 | 12,424 | |||||||||
| Total assets | $ | 254,308 | $ | 275,905 | |||||||
| Liabilities and Equity | |||||||||||
| Current Liabilities: | |||||||||||
| Accounts payable and accrued expenses related to trade creditors | $ | 12,241 | $ | 12,455 | |||||||
| Accrued participations and residuals | 1,725 | 1,822 | |||||||||
| Deferred revenue | 2,757 | 3,040 | |||||||||
| Accrued expenses and other current liabilities | 9,229 | 9,899 | |||||||||
| Current portion of long-term debt | 2,047 | 2,132 | |||||||||
| Total current liabilities | 27,999 | 29,348 | |||||||||
| Long-term debt, less current portion | 90,404 | 92,718 | |||||||||
| Collateralized obligation | 5,172 | 5,170 | |||||||||
| Deferred income taxes | 29,102 | 30,041 | |||||||||
| Other noncurrent liabilities | 20,288 | 20,620 | |||||||||
| Commitments and contingencies | |||||||||||
| Redeemable noncontrolling interests | 409 | 519 | |||||||||
| Equity: | |||||||||||
| Preferred stock—authorized, 20,000,000 shares; issued, zero | — | — | |||||||||
| Class A common stock, $0.01 par value—authorized, 7,500,000,000 shares; issued, 5,186,755,347 and 5,396,576,978; outstanding, 4,313,964,319 and 4,523,785,950 | 52 | 54 | |||||||||
| Class B common stock, $0.01 par value—authorized, 75,000,000 shares; issued and outstanding, 9,444,375 | — | — | |||||||||
| Additional paid-in capital | 39,775 | 40,173 | |||||||||
| Retained earnings | 52,541 | 61,902 | |||||||||
| Treasury stock, 872,791,028 Class A common shares | (7,517) | (7,517) | |||||||||
| Accumulated other comprehensive income (loss) | (4,555) | 1,480 | |||||||||
| Total Comcast Corporation shareholders’ equity | 80,296 | 96,092 | |||||||||
| Noncontrolling interests | 637 | 1,398 | |||||||||
| Total equity | 80,933 | 97,490 | |||||||||
| Total liabilities and equity | $ | 254,308 | $ | 275,905 |
See accompanying notes to condensed consolidated financial statements.
Comcast Corporation
Condensed Consolidated Statement of Changes in Equity
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
| (in millions, except per share data) | 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Redeemable Noncontrolling Interests | |||||||||||||||||
| Balance, beginning of period | $ | 513 | $ | 530 | $ | 519 | $ | 1,280 | |||||||||
| Redemption of subsidiary preferred stock | — | — | — | (725) | |||||||||||||
| Contributions from (distributions to) noncontrolling interests, net | (31) | (19) | (64) | (59) | |||||||||||||
| Other | (80) | — | (80) | (10) | |||||||||||||
| Net income (loss) | 7 | 9 | 34 | 33 | |||||||||||||
| Balance, end of period | $ | 409 | $ | 520 | $ | 409 | $ | 520 | |||||||||
| Class A Common Stock | |||||||||||||||||
| Balance, beginning of period | $ | 53 | $ | 55 | $ | 54 | $ | 54 | |||||||||
| Issuances (repurchases) of common stock under repurchase program and employee plans | (1) | — | (2) | — | |||||||||||||
| Balance, end of period | $ | 52 | $ | 54 | $ | 52 | $ | 54 | |||||||||
| Additional Paid-In Capital | |||||||||||||||||
| Balance, beginning of period | $ | 39,852 | $ | 40,046 | $ | 40,173 | $ | 39,464 | |||||||||
| Stock compensation plans | 245 | 233 | 767 | 802 | |||||||||||||
| Repurchases of common stock under repurchase program and employee plans | (637) | (209) | (1,713) | (340) | |||||||||||||
| Employee stock purchase plans | 63 | 62 | 213 | 201 | |||||||||||||
| Other | 252 | 2 | 335 | 7 | |||||||||||||
| Balance, end of period | $ | 39,775 | $ | 40,134 | $ | 39,775 | $ | 40,134 | |||||||||
| Retained Earnings | |||||||||||||||||
| Balance, beginning of period | $ | 61,209 | $ | 60,359 | $ | 61,902 | $ | 56,438 | |||||||||
| Repurchases of common stock under repurchase program and employee plans | (2,890) | (1,458) | (8,100) | (2,290) | |||||||||||||
| Dividends declared | (1,179) | (1,153) | (3,607) | (3,470) | |||||||||||||
| Other | (2) | — | (1) | 4 | |||||||||||||
| Net income (loss) | (4,598) | 4,035 | 2,347 | 11,102 | |||||||||||||
| Balance, end of period | $ | 52,541 | $ | 61,783 | $ | 52,541 | $ | 61,783 | |||||||||
| Treasury Stock at Cost | |||||||||||||||||
| Balance, beginning of period | $ | (7,517) | $ | (7,517) | $ | (7,517) | $ | (7,517) | |||||||||
| Balance, end of period | $ | (7,517) | $ | (7,517) | $ | (7,517) | $ | (7,517) | |||||||||
| Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||
| Balance, beginning of period | $ | (2,170) | $ | 1,992 | $ | 1,480 | $ | 1,884 | |||||||||
| Other comprehensive income (loss) | (2,385) | (664) | (6,035) | (556) | |||||||||||||
| Balance, end of period | $ | (4,555) | $ | 1,328 | $ | (4,555) | $ | 1,328 | |||||||||
| Noncontrolling Interests | |||||||||||||||||
| Balance, beginning of period | $ | 1,132 | $ | 1,581 | $ | 1,398 | $ | 1,415 | |||||||||
| Other comprehensive income (loss) | (56) | 2 | (68) | 11 | |||||||||||||
| Contributions from (distributions to) noncontrolling interests, net | (86) | 55 | (86) | 379 | |||||||||||||
| Other | (278) | (2) | (277) | — | |||||||||||||
| Net income (loss) | (75) | (112) | (329) | (282) | |||||||||||||
| Balance, end of period | $ | 637 | $ | 1,524 | $ | 637 | $ | 1,524 | |||||||||
| Total equity | $ | 80,933 | $ | 97,306 | $ | 80,933 | $ | 97,306 | |||||||||
| Cash dividends declared per common share | $ | 0.27 | $ | 0.25 | $ | 0.81 | $ | 0.75 |
See accompanying notes to condensed consolidated financial statements.
Comcast Corporation
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1: Condensed Consolidated Financial Statements
Basis of Presentation
We have prepared these unaudited condensed consolidated financial statements based on SEC rules that permit reduced disclosure for interim periods. These financial statements include all adjustments that are necessary for a fair presentation of our consolidated results of operations, cash flows and financial condition for the periods shown, including normal, recurring accruals and other items. The consolidated results of operations for the interim periods presented are not necessarily indicative of results for the full year.
The year-end condensed consolidated balance sheet was derived from audited financial statements but does not include all disclosures required by generally accepted accounting principles in the United States (“GAAP”). For a more complete discussion of our accounting policies and certain other information, refer to our consolidated financial statements included in our 2021 Annual Report on Form 10-K and the notes within this Quarterly Report on Form 10-Q.
Note 2: Segment Information
We present our operations in five reportable business segments: (1) Comcast Cable in one reportable business segment, referred to as Cable Communications; (2) NBCUniversal in three reportable business segments: Media, Studios and Theme Parks (collectively, the “NBCUniversal segments”); and (3) Sky in one reportable business segment.
Cable Communications is a leading provider of broadband, video, voice, wireless, and other services to residential customers in the United States under the Xfinity brand. We also provide these and other services to business customers and sell advertising.
Media consists primarily of NBCUniversal’s television and streaming platforms, including national, regional and international cable networks; the NBC and Telemundo broadcast networks; NBC and Telemundo owned local broadcast television stations; and Peacock, our direct-to-consumer streaming service.
Studios consists primarily of NBCUniversal’s film and television studio production and distribution operations.
Theme Parks consists primarily of our Universal theme parks in Orlando, Florida; Hollywood, California; Osaka, Japan; and Beijing, China.
Sky is one of Europe’s leading entertainment companies, which primarily includes a direct-to-consumer business, providing video, broadband, voice and wireless phone services, and a content business, operating entertainment networks, the Sky News broadcast network and Sky Sports networks.
Our other business interests consist primarily of the operations of Comcast Spectacor, which owns the Philadelphia Flyers and the Wells Fargo Center arena in Philadelphia, Pennsylvania, and other business initiatives.
We use Adjusted EBITDA to evaluate the profitability of our operating segments and the components of net income attributable to Comcast Corporation excluded from Adjusted EBITDA are not separately evaluated. Our financial data by reportable segment is presented in the tables below.
Comcast Corporation
| Three Months Ended September 30, 2022 | |||||||||||||||||
| (in millions) | Revenue(a) | Adjusted EBITDA(b) | Depreciation and Amortization | Capital Expenditures | Cash Paid for Intangible Assets | ||||||||||||
| Cable Communications | $ | 16,539 | $ | 7,452 | $ | 1,945 | $ | 2,021 | $ | 369 | |||||||
| NBCUniversal | |||||||||||||||||
| Media | 5,230 | 583 | 198 | 25 | 63 | ||||||||||||
| Studios | 3,163 | 537 | 11 | 1 | 4 | ||||||||||||
| Theme Parks | 2,064 | 819 | 266 | 450 | 15 | ||||||||||||
| Headquarters and Other | 22 | (199) | 121 | 137 | 46 | ||||||||||||
| Eliminations(a) | (909) | (59) | — | — | — | ||||||||||||
| NBCUniversal | 9,570 | 1,681 | 596 | 614 | 129 | ||||||||||||
| Sky(c) | 4,253 | 701 | 722 | 96 | 183 | ||||||||||||
| Corporate and Other | 147 | (378) | 70 | 59 | 87 | ||||||||||||
| Eliminations(a) | (660) | 26 | — | — | — | ||||||||||||
| Comcast Consolidated | $ | 29,849 | $ | 9,482 | $ | 3,333 | $ | 2,791 | $ | 769 |
| Three Months Ended September 30, 2021 | |||||||||||||||||
| (in millions) | Revenue(a) | Adjusted EBITDA(b) | Depreciation and Amortization | Capital Expenditures | Cash Paid for Intangible Assets | ||||||||||||
| Cable Communications | $ | 16,115 | $ | 7,069 | $ | 1,965 | $ | 1,673 | $ | 370 | |||||||
| NBCUniversal | |||||||||||||||||
| Media | 6,770 | 997 | 248 | 20 | 38 | ||||||||||||
| Studios | 2,407 | 179 | 14 | 1 | 3 | ||||||||||||
| Theme Parks | 1,449 | 434 | 213 | 122 | 8 | ||||||||||||
| Headquarters and Other | 28 | (248) | 115 | 87 | 36 | ||||||||||||
| Eliminations(a) | (654) | (12) | — | — | — | ||||||||||||
| NBCUniversal | 10,001 | 1,349 | 591 | 229 | 85 | ||||||||||||
| Sky | 4,988 | 971 | 884 | 160 | 221 | ||||||||||||
| Corporate and Other | 65 | (335) | 38 | 80 | 48 | ||||||||||||
| Eliminations(a) | (871) | (98) | — | — | — | ||||||||||||
| Comcast Consolidated | $ | 30,298 | $ | 8,957 | $ | 3,477 | $ | 2,142 | $ | 723 |
| Nine Months Ended September 30, 2022 | |||||||||||||||||
| (in millions) | Revenue(a) | Adjusted EBITDA(b) | Depreciation and Amortization | Capital Expenditures | Cash Paid for Intangible Assets | ||||||||||||
| Cable Communications | $ | 49,680 | $ | 22,172 | $ | 5,850 | $ | 5,164 | $ | 1,113 | |||||||
| NBCUniversal | |||||||||||||||||
| Media | 17,427 | 3,080 | 698 | 59 | 152 | ||||||||||||
| Studios | 8,885 | 783 | 34 | 3 | 12 | ||||||||||||
| Theme Parks | 5,428 | 1,902 | 814 | 990 | 30 | ||||||||||||
| Headquarters and Other | 46 | (528) | 363 | 331 | 122 | ||||||||||||
| Eliminations(a) | (2,474) | (98) | — | — | — | ||||||||||||
| NBCUniversal | 29,311 | 5,138 | 1,909 | 1,383 | 315 | ||||||||||||
| Sky(c) | 13,529 | 2,185 | 2,402 | 373 | 506 | ||||||||||||
| Corporate and Other | 549 | (944) | 188 | 141 | 219 | ||||||||||||
| Eliminations(a) | (2,196) | (93) | — | — | — | ||||||||||||
| Comcast Consolidated | $ | 90,874 | $ | 28,459 | $ | 10,349 | $ | 7,062 | $ | 2,152 |
Comcast Corporation
| Nine Months Ended September 30, 2021 | |||||||||||||||||
| (in millions) | Revenue(a) | Adjusted EBITDA(b) | Depreciation and Amortization | Capital Expenditures | Cash Paid for Intangible Assets | ||||||||||||
| Cable Communications | $ | 47,922 | $ | 20,972 | $ | 5,845 | $ | 4,739 | $ | 1,022 | |||||||
| NBCUniversal | |||||||||||||||||
| Media | 16,955 | 3,847 | 749 | 49 | 112 | ||||||||||||
| Studios | 7,027 | 833 | 39 | 2 | 9 | ||||||||||||
| Theme Parks | 3,163 | 593 | 615 | 348 | 23 | ||||||||||||
| Headquarters and Other | 65 | (643) | 356 | 184 | 93 | ||||||||||||
| Eliminations(a) | (2,230) | (238) | — | — | — | ||||||||||||
| NBCUniversal | 24,981 | 4,392 | 1,759 | 584 | 238 | ||||||||||||
| Sky | 15,205 | 1,895 | 2,524 | 615 | 633 | ||||||||||||
| Corporate and Other | 246 | (876) | 95 | 208 | 113 | ||||||||||||
| Eliminations(a) | (2,304) | (87) | — | — | — | ||||||||||||
| Comcast Consolidated | $ | 86,049 | $ | 26,297 | $ | 10,222 | $ | 6,146 | $ | 2,006 |
(a)Included in Eliminations are transactions that our segments enter into with one another. Our segments generally report transactions with one another as if they were stand-alone businesses in accordance with GAAP, and these transactions are eliminated in consolidation. When multiple segments enter into transactions to provide products and services to third parties, revenue is generally allocated to our segments based on relative value. The most significant transactions between our segments include content licensing revenue in Studios for licenses of owned content to Media and Sky; distribution revenue in Media for fees received from Cable Communications for the sale of cable network programming and under retransmission consent agreements; and advertising revenue in Media and Cable Communications. Revenue for licenses of content from Studios to Media and Sky is generally recognized at a point in time, consistent with the recognition of transactions with third parties, when the content is delivered and made available for use. The costs of these licenses in Media and Sky are recognized as the content is used over the license period. The difference in timing of recognition between segments results in an Adjusted EBITDA impact in eliminations, as the profits (losses) on these transactions are deferred in our consolidated results and recognized as the content is used over the license period.
A summary of revenue for each of our segments resulting from transactions with other segments and eliminated in consolidation is presented in the table below.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
| Cable Communications | $ | 55 | $ | 69 | $ | 172 | $ | 162 | |||||||||||||||
| NBCUniversal | |||||||||||||||||||||||
| Media | 514 | 714 | 1,705 | 1,799 | |||||||||||||||||||
| Studios | 946 | 682 | 2,617 | 2,357 | |||||||||||||||||||
| Theme Parks | — | — | 1 | 1 | |||||||||||||||||||
| Headquarters and Other | 16 | 23 | 34 | 52 | |||||||||||||||||||
| Sky | 5 | 3 | 13 | 26 | |||||||||||||||||||
| Corporate and Other | 34 | 32 | 127 | 137 | |||||||||||||||||||
| Total intersegment revenue | $ | 1,569 | $ | 1,525 | $ | 4,670 | $ | 4,535 |
(b)We use Adjusted EBITDA as the measure of profit or loss for our operating segments. From time to time we may report the impact of certain events, gains, losses or other charges related to our operating segments within Corporate and Other. Our reconciliation of the aggregate amount of Adjusted EBITDA for our reportable segments to consolidated income before income taxes is presented in the table below.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
| Adjusted EBITDA | $ | 9,482 | $ | 8,957 | $ | 28,459 | $ | 26,297 | |||||||||||||||
| Adjustments | 9 | (30) | (15) | (79) | |||||||||||||||||||
| Depreciation | (2,150) | (2,177) | (6,525) | (6,407) | |||||||||||||||||||
| Amortization | (1,183) | (1,301) | (3,824) | (3,815) | |||||||||||||||||||
| Goodwill and long-lived asset impairments | (8,583) | — | (8,583) | — | |||||||||||||||||||
| Interest expense | (960) | (1,050) | (2,922) | (3,161) | |||||||||||||||||||
| Investment and other income (loss), net | (266) | 766 | (975) | 2,374 | |||||||||||||||||||
| Income (loss) before income taxes | $ | (3,652) | $ | 5,166 | $ | 5,614 | $ | 15,208 | |||||||||||||||
Adjustments represent the impact of certain events, gains, losses or other charges that are excluded from Adjusted EBITDA, including costs related to our investment portfolio, and Sky transaction-related costs in 2021.
(c) Refer to Note 8 for discussion of impairment charges related to goodwill and long-lived assets in our Sky segment.
Comcast Corporation
Note 3: Revenue
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
| Residential: | |||||||||||||||||||||||
| Broadband | $ | 6,135 | $ | 5,801 | $ | 18,292 | $ | 17,118 | |||||||||||||||
| Video | 5,255 | 5,499 | 16,214 | 16,676 | |||||||||||||||||||
| Voice | 745 | 851 | 2,293 | 2,592 | |||||||||||||||||||
| Wireless | 789 | 603 | 2,188 | 1,672 | |||||||||||||||||||
| Business services | 2,436 | 2,227 | 7,256 | 6,597 | |||||||||||||||||||
| Advertising | 756 | 705 | 2,174 | 2,002 | |||||||||||||||||||
| Other | 423 | 427 | 1,263 | 1,265 | |||||||||||||||||||
| Total Cable Communications | 16,539 | 16,115 | 49,680 | 47,922 | |||||||||||||||||||
| Advertising | 2,111 | 3,255 | 7,603 | 7,537 | |||||||||||||||||||
| Distribution | 2,578 | 2,987 | 8,270 | 7,934 | |||||||||||||||||||
| Other | 541 | 528 | 1,554 | 1,483 | |||||||||||||||||||
| Total Media | 5,230 | 6,770 | 17,427 | 16,955 | |||||||||||||||||||
| Content licensing | 2,134 | 1,827 | 6,531 | 5,683 | |||||||||||||||||||
| Theatrical | 673 | 307 | 1,391 | 544 | |||||||||||||||||||
| Home entertainment and other | 356 | 273 | 963 | 801 | |||||||||||||||||||
| Total Studios | 3,163 | 2,407 | 8,885 | 7,027 | |||||||||||||||||||
| Total Theme Parks | 2,064 | 1,449 | 5,428 | 3,163 | |||||||||||||||||||
| Headquarters and Other | 22 | 28 | 46 | 65 | |||||||||||||||||||
| Eliminations(a) | (909) | (654) | (2,474) | (2,230) | |||||||||||||||||||
| Total NBCUniversal | 9,570 | 10,001 | 29,311 | 24,981 | |||||||||||||||||||
| Direct-to-consumer | 3,510 | 4,127 | 11,073 | 12,415 | |||||||||||||||||||
| Content | 273 | 300 | 833 | 1,013 | |||||||||||||||||||
| Advertising | 471 | 561 | 1,623 | 1,777 | |||||||||||||||||||
| Total Sky | 4,253 | 4,988 | 13,529 | 15,205 | |||||||||||||||||||
| Corporate and Other | 147 | 65 | 549 | 246 | |||||||||||||||||||
| Eliminations(a) | (660) | (871) | (2,196) | (2,304) | |||||||||||||||||||
| Total revenue | $ | 29,849 | $ | 30,298 | $ | 90,874 | $ | 86,049 |
(a)Included in Eliminations are transactions that our segments enter into with one another. See Note 2 for a description of these transactions.
Condensed Consolidated Balance Sheet
The following tables summarize our accounts receivable and other balances that are not separately presented in our condensed consolidated balance sheet that relate to the recognition of revenue and collection of the related cash, as well as the deferred costs associated with our contracts with customers.
| (in millions) | September 30, 2022 | December 31, 2021 | |||||||||
| Receivables, gross | $ | 12,609 | $ | 12,666 | |||||||
| Less: Allowance for doubtful accounts | 691 | 658 | |||||||||
| Receivables, net | $ | 11,918 | $ | 12,008 | |||||||
| (in millions) | September 30, 2022 | December 31, 2021 | |||||||||
| Noncurrent receivables, net (included in other noncurrent assets, net) | $ | 1,750 | $ | 1,632 | |||||||
| Contract acquisition and fulfillment costs (included in other noncurrent assets, net) | $ | 1,054 | $ | 1,094 | |||||||
| Noncurrent deferred revenue (included in other noncurrent liabilities) | $ | 701 | $ | 695 |
Comcast Corporation
Note 4: Programming and Production Costs
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
| Video distribution programming | $ | 3,242 | $ | 3,337 | $ | 9,955 | $ | 10,267 | |||||||||||||||
| Film and television content: | |||||||||||||||||||||||
| Owned(a) | 2,538 | 2,215 | 7,965 | 6,406 | |||||||||||||||||||
| Licensed, including sports rights | 2,867 | 4,536 | 9,569 | 11,028 | |||||||||||||||||||
| Other | 303 | 307 | 918 | 868 | |||||||||||||||||||
| Total programming and production costs | $ | 8,949 | $ | 10,395 | $ | 28,406 | $ | 28,570 |
(a) Amount includes amortization of owned content of $2.0 billion and $6.3 billion for the three and nine months ended September 30, 2022, respectively, and $1.9 billion and $5.3 billion for the three and nine months ended September 30, 2021, respectively, as well as participations and residuals expenses.
Capitalized Film and Television Costs
| (in millions) | September 30, 2022 | December 31, 2021 | |||||||||
| Owned: | |||||||||||
| Released, less amortization | $ | 4,209 | $ | 3,726 | |||||||
| Completed, not released | 195 | 536 | |||||||||
| In production and in development | 3,234 | 2,732 | |||||||||
| 7,638 | 6,994 | ||||||||||
| Licensed, including sports advances | 5,048 | 5,811 | |||||||||
| Film and television costs | $ | 12,685 | $ | 12,806 |
Note 5: Long-Term Debt
As of September 30, 2022, our debt had a carrying value of $92.5 billion and an estimated fair value of $82.1 billion. As of December 31, 2021, our debt had a carrying value of $94.8 billion and an estimated fair value of $109.3 billion. The estimated fair value of our publicly traded debt was primarily based on Level 1 inputs that use quoted market value for the debt. The estimated fair value of debt for which there are no quoted market prices was based on Level 2 inputs that use interest rates available to us for debt with similar terms and remaining maturities.
Note 6: Significant Transactions
Acquisitions
In October 2021, we acquired Masergy, a provider of software-defined networking and cloud platforms for global enterprises, for total cash consideration of $1.2 billion. The acquisition accelerates our growth in serving large and mid-sized companies, particularly U.S.-based organizations with multi-site global enterprises. Masergy’s results of operations are included in our consolidated results of operations since the acquisition date and are reported in our Cable Communications segment. We have recorded Masergy’s assets and liabilities at their estimated fair values with $845 million recorded to goodwill and the remainder primarily attributed to software and customer relationship intangible assets. The acquisition was not material to our consolidated results of operations.
Comcast Corporation
Note 7: Investments and Variable Interest Entities
Investment and Other Income (Loss), Net
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
| Equity in net income (losses) of investees, net | $ | (242) | $ | 602 | $ | (523) | $ | 1,696 | |||||||||||||||
| Realized and unrealized gains (losses) on equity securities, net | (2) | 106 | (207) | 532 | |||||||||||||||||||
| Other income (loss), net | (21) | 59 | (245) | 146 | |||||||||||||||||||
| Investment and other income (loss), net | $ | (266) | $ | 766 | $ | (975) | $ | 2,374 |
The amount of unrealized gains (losses), net recognized in the three months ended September 30, 2022 and 2021 that related to marketable and nonmarketable equity securities still held as of the end of each reporting period were $(43) million and $(165) million, respectively. The amount of unrealized gains (losses), net recognized in the nine months ended September 30, 2022 and 2021 that related to marketable and nonmarketable equity securities still held as of the end of each reporting period were $(283) million and $91 million, respectively.
Investments
| (in millions) | September 30, 2022 | December 31, 2021 | |||||||||
| Equity method | $ | 5,487 | $ | 6,111 | |||||||
| Marketable equity securities | 143 | 406 | |||||||||
| Nonmarketable equity securities | 1,704 | 1,735 | |||||||||
| Other investments | 1,645 | 803 | |||||||||
| Total investments | 8,979 | 9,055 | |||||||||
| Less: Current investments | 1,122 | 368 | |||||||||
| Less: Investment securing collateralized obligation | 539 | 605 | |||||||||
| Noncurrent investments | $ | 7,318 | $ | 8,082 |
Equity Me****thod Investments
The amount of cash distributions received from equity method investments presented within operating activities in the condensed consolidated statement of cash flows in the nine months ended September 30, 2022 and 2021 was $114 million and $298 million, respectively.
Atairos
Atairos is a variable interest entity (“VIE”) that follows investment company accounting and records its investments at their fair values each reporting period with the net gains or losses reflected in its statement of operations. We recognize our share of these gains and losses in equity in net income (losses) of investees, net. For the nine months ended September 30, 2022 and 2021, we made cash capital contributions to Atairos totaling $39 million and $36 million, respectively. As of September 30, 2022 and December 31, 2021, our investment in Atairos, inclusive of certain distributions retained by Atairos on our behalf and classified as advances within other investments, was $4.3 billion and $4.7 billion, respectively. As of September 30, 2022, our remaining unfunded capital commitment was $1.5 billion.
Hulu and Collateralized Obligation
In 2019, we borrowed $5.2 billion under a term loan facility due March 2024 which is fully collateralized by the minimum guaranteed proceeds of the put/call option related to our investment in Hulu. As of September 30, 2022 and December 31, 2021, the carrying value and estimated fair value of our collateralized obligation were $5.2 billion. The estimated fair value was based on Level 2 inputs that use interest rates for debt with similar terms and remaining maturities. We present our investment in Hulu and the term loan separately in our condensed consolidated balance sheet in the captions “investment securing collateralized obligation” and “collateralized obligation,” respectively. The recorded value of our investment reflects our historical cost in applying the equity method, and as a result, is less than its fair value.
Comcast Corporation
Other Investments
Other investments also includes investments in certain short-term instruments with maturities over three months when purchased, such as commercial paper, certificates of deposit and U.S. government obligations, which are generally accounted for at amortized cost. These short-term instruments totaled $977 million as of September 30, 2022 and there were no such investments as of December 31, 2021. The carrying amounts of these investments approximate their fair values, which are primarily based on Level 2 inputs that use interest rates for instruments with similar terms and remaining maturities.
Consolidated Variable Interest Entity
Universal Beijing Resort
We own a 30% interest in a Universal theme park and resort in Beijing, China (“Universal Beijing Resort”), which opened in September 2021. Universal Beijing Resort is a consolidated VIE with the remaining interest owned by a consortium of Chinese state-owned companies. The construction was funded through a combination of debt financing and equity contributions from the partners in accordance with their equity interests. As of September 30, 2022, Universal Beijing Resort had $3.3 billion of debt outstanding, including $3.0 billion principal amount of a term loan outstanding under the debt financing agreement.
As of September 30, 2022, our condensed consolidated balance sheet included assets and liabilities of Universal Beijing Resort totaling $8.1 billion and $7.2 billion, respectively. The assets and liabilities of Universal Beijing Resort primarily consist of property and equipment, operating lease assets and liabilities, and debt.
Note 8: Goodwill and Intangible Assets
Goodwill by Segment
| NBCUniversal | |||||||||||||||||||||||||||||||||||
| (in millions) | Cable Communications | Media | Studios | Theme Parks | Sky | Corporate and Other | Total | ||||||||||||||||||||||||||||
| Balance, December 31, 2021 | $ | 16,192 | $ | 14,700 | $ | 3,672 | $ | 6,429 | $ | 29,196 | $ | — | $ | 70,189 | |||||||||||||||||||||
| Impairment | — | — | — | — | (8,098) | — | (8,098) | ||||||||||||||||||||||||||||
| Foreign currency translation and other | (146) | (93) | (11) | (1,116) | (4,341) | 30 | (5,677) | ||||||||||||||||||||||||||||
| Balance, September 30, 2022 | $ | 16,046 | $ | 14,607 | $ | 3,661 | $ | 5,313 | $ | 16,757 | $ | 30 | $ | 56,414 |
We assess the recoverability of our goodwill annually as of July 1, and as a result, in the third quarter of 2022, we recorded a goodwill impairment of $8.1 billion in our Sky reporting unit. The fair value of the reporting unit was estimated using a discounted cash flow analysis. When performing this analysis, we also considered multiples of earnings from comparable public companies and recent market transactions. The decline in fair value primarily resulted from an increased discount rate and reduced estimated future cash flows as a result of macroeconomic conditions in the Sky territories. In connection with this assessment, in the third quarter of 2022, we also recorded impairments of intangible assets related to our Sky segment, which primarily related to customer relationship assets. These impairments totaled $485 million and are presented in goodwill and long-lived asset impairments in the consolidated statement of income.
Note 9: Equity and Share-Based Compensation
Weighted-Average Common Shares Outstanding
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||
| (in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||
| Weighted-average number of common shares outstanding – basic | 4,377 | 4,588 | 4,449 | 4,593 | ||||||||||||||||
| Effect of dilutive securities | — | 77 | 29 | 75 | ||||||||||||||||
| Weighted-average number of common shares outstanding – diluted | 4,377 | 4,665 | 4,477 | 4,668 | ||||||||||||||||
| Antidilutive securities | 288 | 37 | 156 | 33 |
Diluted earnings per common share attributable to Comcast Corporation shareholders (“diluted EPS”) considers the impact of potentially dilutive securities using the treasury stock method. There are no potentially dilutive shares included for the three months ended September 30, 2022 because their effect would be antidilutive as a result of the loss for the period. Antidilutive securities represent the number of potential common shares related to share-based compensation awards that were excluded from diluted EPS because their effect would have been antidilutive.
Comcast Corporation
Accumulated Other Comprehensive Income (Loss)
| (in millions) | September 30, 2022 | December 31, 2021 | |||||||||
| Cumulative translation adjustments | $ | (5,149) | $ | 1,119 | |||||||
| Deferred gains (losses) on cash flow hedges | 387 | 104 | |||||||||
| Unrecognized gains (losses) on employee benefit obligations and other | 207 | 257 | |||||||||
| Accumulated other comprehensive income (loss), net of deferred taxes | $ | (4,555) | $ | 1,480 |
Share-Based Compensation
Our share-based compensation plans consist primarily of awards of RSUs and stock options to certain employees and directors as part of our approach to long-term incentive compensation. Additionally, through our employee stock purchase plans, employees are able to purchase shares of our common stock at a discount through payroll deductions.
In March 2022, we granted 16 million RSUs and 51 million stock options related to our annual management awards. The weighted-average fair values associated with these grants were $46.46 per RSU and $8.81 per stock option.
Recognized Share-Based Compensation Expense
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
| Restricted share units | $ | 172 | $ | 167 | $ | 531 | $ | 560 | |||||||||||||||
| Stock options | 74 | 70 | 240 | 248 | |||||||||||||||||||
| Employee stock purchase plans | 10 | 9 | 31 | 29 | |||||||||||||||||||
| Total | $ | 256 | $ | 246 | $ | 802 | $ | 837 |
As of September 30, 2022, we had unrecognized pretax compensation expense of $1.5 billion and $691 million related to nonvested RSUs and nonvested stock options, respectively.
Note 10: Supplemental Financial Information
Income Taxes
In the third quarter of 2022, a state tax law change was enacted that resulted in a decrease to our net deferred tax liabilities of $286 million, with a corresponding decrease in income tax expense. In the second quarter of 2021, tax law changes were enacted in the United Kingdom that resulted in an increase to our net deferred tax liabilities of $498 million, with a corresponding increase in income tax expense. The goodwill impairment in the third quarter of 2022 (see Note 8) was primarily not deductible for tax purposes.
Cash Payments for Interest and Income Taxes
| Nine Months Ended September 30, | |||||||||||
| (in millions) | 2022 | 2021 | |||||||||
| Interest | $ | 2,341 | $ | 2,943 | |||||||
| Income taxes | $ | 4,022 | $ | 2,201 |
Noncash Activities
During the nine months ended September 30, 2022:
-
we acquired $2.2 billion of property and equipment and intangible assets that were accrued but unpaid
-
we recorded a liability of $1.2 billion for a quarterly cash dividend of $0.27 per common share paid in October 2022
Comcast Corporation
During the nine months ended September 30, 2021:
-
we recognized operating lease assets and liabilities of $2.8 billion related to Universal Beijing Resort
-
we acquired $1.6 billion of property and equipment and intangible assets that were accrued but unpaid
-
we recorded a liability of $1.2 billion for a quarterly cash dividend of $0.25 per common share paid in October 2021
Cash, Cash Equivalents and Restricted Cash
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the condensed consolidated balance sheet to the total of the amounts reported in our condensed consolidated statement of cash flows.
| (in millions) | September 30, 2022 | December 31, 2021 | |||||||||
| Cash and cash equivalents | $ | 5,695 | $ | 8,711 | |||||||
| Restricted cash included in other current assets | 22 | 56 | |||||||||
| Restricted cash included in other noncurrent assets, net | 13 | 12 | |||||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 5,729 | $ | 8,778 |
Note 11: Commitments and Contingencies
Redeemable Subsidiary Preferred Stock
In the first quarter of 2021, we redeemed all of the NBCUniversal Enterprise, Inc. preferred stock and made cash payments equal to the aggregate liquidation preference of $725 million. The redeemable subsidiary preferred stock was presented in redeemable noncontrolling interests.
Contingencies
We are subject to legal proceedings and claims that arise in the ordinary course of our business. While the amount of ultimate liability with respect to such actions is not expected to materially affect our results of operations, cash flows or financial position, any litigation resulting from any such legal proceedings or claims could be time-consuming and injure our reputation.
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