Comcast Corporation

Good morning, ladies and gentlemen, and welcome to Comcast's second quarter 2019 earnings conference call. At this time, all participants are in a listen-only mode. Please note that this conference call is being recorded. I will now turn the call over to Senior Vice President, Investor Relations and Finance, Mr. Jason Armstrong. Please go ahead, Mr. Armstrong.

Thank you, Operator, and welcome, everyone. Joining me on this morning's call are Brian Roberts, Mike Cavanaugh, Steve Burke, Dave Watson, and Jeremy Derrick. Brian and Mike will make formal remarks, and Steve, Dave, and Jeremy will also be available for Q&A. As always, let me now refer you to slide number two, which contains our safe harbor disclaimer, and remind you that this conference call may include forward-looking statements subject to certain risks and uncertainties. In addition, in this call, we will refer to certain non-GAAP financial measures. please refer to our 8K and trending schedules for the reconciliations of non-GAAP financial measures to GAAP. With that, let me turn the call over to Brian Roberts for his comments. Brian? Thanks, Jason, and good morning, everyone.

I'm really pleased with our strong second quarter results and the continued successful execution of our strategy. All of our businesses demonstrated significant growth contributing to adjusted EBITDA of $8.7 billion in the quarter, an increase of 7.6%. We also delivered 78 cents of adjusted EPS in the quarter, an increase of 13% over the prior year. All in all, we generated $4.2 billion of free cash flow in the second quarter, resulting in a year-to-date total of $8.8 billion. The key driver of this sustained growth continues to be our market position with 55 million valuable customers in many of the world's most attractive markets, generating $111 in revenue per customer each month with high margin and strong retention. Across Sky and Cable, we added 456,000 new relationships this quarter and 868,000 in the first half of the year. In all of the geographies in which we compete, we lead with superior products, content, and technology. In the U.S., connectivity is the focal point of our customer relationships, enabled by our world-class network. Our connectivity businesses, again, generated nearly 10% growth in revenue and collectively are on track to deliver the 14th consecutive year of well over 1 million broadband net additions. In Europe, Sky's premium brand and exclusive content is the principal differentiation in our relationship with customers, driving net additions of 304,000 in the quarter. Importantly, across the company, we also have leading scale and premium content with a vast library of IP and new productions that are extremely popular across generations and geographies. At NBC, we're on a path to finish number one in the U.S. for the sixth straight year in the key demographic of adults 18 to 49, and at Telemundo, we're number one in Spanish language prime time. In film, we are executing our strategic slate approach and look forward to the return of the hugely successful Fast and Furious franchise with the spinoff of Hobbs and Shaw later this August. And Sky continues to develop a strong lineup of original content, including their highly acclaimed Chernobyl, which debuted in the second quarter. On the back of this success, we launched Sky Studios to expand our production capabilities and more than double the investment in local original content. The popularity and scale of this premium content and advertisers' need for trusted, brand-safe environments drove NBCUniversal's upfront to record levels this year. Advertising is a core strength, and once again, we led the market on both volume and price. The overall portfolio volume was close to $7 billion, an increase of 10% over last year, and the average price was similarly strong. We helped shift the marketplace to embrace all video, unifying all screens, platforms, and content, breaking down the historic barriers between linear and digital, which is particularly important as we prepare to launch our ad-supported streaming service next year. To that end, we had record digital video sales, an increase of 50% over the prior year. So when you add the scale and strength of our customer relationships, premium content, and advertising capabilities, we have a uniquely strong position to capture and profit from the growth opportunities in our markets. For example, in the streaming segment, we've already made significant moves to better serve viewers who want to consume content in and out of the home. Sky was ahead of the curve launching Now TV almost seven years ago. The platform has proven to be incredibly durable and popular, evident in Sky's Q2 net additions. At Cable, Flex offers a new approach for our broadband customers to enjoy the most popular streaming apps on our X1 platform, including the voice remote, without requiring a traditional linear content subscription. Finally, at NBCUniversal, we're making great progress on the direct-to-consumer streaming service that we announced earlier this year. We believe the strength of our assets and leadership across our businesses, combined with access to tens of millions of customers, will lower both our cost of entry and execution risk as we deliver a truly special offering. All in all, our strong operating and financial momentum continues. If you take a step back, there's significant competition and change in the ecosystem right now. But that said, for years, we felt that video over the Internet is more friend than foe. We believe it plays to our strengths. We've got a great roadmap in each of our businesses and an even better outlook when you add it all together. The fastest broadband married to world-class platforms, as well as highly rated relevant content. And we are the leading company in both of those businesses at scale globally. It's our scale that allows us to evolve and continue to invest, all while maintaining momentum and driving substantial growth. And this has always been our approach. In fact, if you look over the last 10 years, just to pick one stat showing our consistency during significant other transitions in our business, We've grown adjusted EPS by double digits in nine of those ten years, and we're pretty close in the tenth year. Our second quarter and first half results continue this trend of robust growth, and our outlook is for more of the same. Over to you, Mike.