Comcast Corp. (CMCSA) reported better-than-expected first quarter 2010 financial results. Quarterly GAAP net income was $866 million or 31 cents per share, compared to $772 million or 27 cents per share in the prior-year quarter.
First quarter EPS of 31 cents also exceeds the Zacks Consensus Estimate of 30 cents. Higher revenue and lower interest expense from a reduction in total debt are the primary reasons for the positive surprise.
First quarter 2010 total revenue was $9,202 million, up 3.8% year-over-year. This was also better than the Zacks Consensus Estimate of $9,150 million. Advertising revenue rebounded in the reported quarter with a 23.5% year-over-year growth to $360 million. However, its basic video business continued to decline, by 2% year-over-year to $4.84 billion. This was mainly due to stiff competition from the fiber-optic network of telecom operators as well as from satellite TV service providers.
Gross margin in the first quarter was 59.4%, almost the same year-over-year. Operating margin was 21% in the reported quarter compared to 21.2% in the year-ago quarter. For the first quarter 2010, Comcast declared a dividend of 9 cents per common share compared to 6 cents in the year-ago quarter. During the same quarter, Comcast repurchased 19.2 million common shares for a total consideration of $300 million.
Cash and marketable securities at the end of the first quarter 2010 was $9,791 million, compared to $6,668 million at the end of fiscal 2009. Total debt at the end of the first quarter 2010 was approximately $30.92 billion, compared to $29.1 billion at the end of fiscal 2009. Excluding the impact of Economic Stimulus Packages, free cash flow during the first quarter 2010 was $1,887 million compared to $1,366 million during the prior-year quarter.
Cable
Quarterly revenue from the Cable segment was $8,677 million, up 3.5% year-over-year. Operating cash flow from this segment was $3,542 million, up 4.1% year-over-year. At the end of the first quarter 2010, Comcast had 16.329 million (up 7% year-over-year) High-Speed Internet customers; 7.895 million (up 16.6% year-over-year) Voice customers; 23.477 million (down 2.6% year-over-year) Video customers; and 18.843 million (up 9% year-over-year) Digital Video customers.
Programming
Quarterly revenue from the Programming segment was $385 million, up 6.7% year-over-year. This was mainly due to higher affiliate and advertising revenue. Operating cash flow from this segment was $121 million, up 8.5% year-over-year.
Corporate & Other
Quarterly revenue from the Corporate & Other segment was $140 million, up 14.5% year-over-year. Operating cash flow from this segment was a loss of $98 million in the quarter, compared to a loss of $72 million in the year-ago quarter.
Read the full analyst report on “CMCSA”
Zacks Investment Research
