Comcast Corporation

Good morning, ladies and gentlemen, and welcome to the Comcast third quarter 2021 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, Ms. Marci Reivicker. Please go ahead, Ms. Reivicker.

Thank you, Operator, and welcome, everyone. Joining me on this morning's call are Brian Roberts, Mike Kavanaugh, Dave Watson, Jeff Schell, and Dana Strong. Brian and Mike will make formal remarks, while Dave, Jeff, and Dana will also be available for Q&A. Let me now refer you to slide two, which contains our safe harbor disclaimer. I remind you that this conference call may include forward-looking statements subject to certain risks and uncertainties. In addition, during this call, we will refer to certain non-GAAP financial measures. Please see our 8K and trending schedules for the reconciliations of these non-GAAP financial measures to GAAP. With that, let me turn the call over to Brian Roberts for his comments. Brian? Thanks, Marcine.

Good morning, everyone. We had a wonderful third quarter across the entire company with 18% growth in adjusted EBITDA and 34% growth in adjusted EPS. and we generated $3.2 billion of free cash flow. One of our goals the past several years has been to return to a position of offensively investing in our existing businesses, paying a growing dividend, and also buying back meaningful amounts of stock. So I'm pleased to report that we have now achieved all of that in this quarter, and we are back to our desired leverage ratios. Our cable division continues to be a standout, delivering over 7% revenue growth and the fifth consecutive quarter of double-digit EBITDA growth, up 10%, fueled by our broadband business, which generated 300,000 net additions and contributed to a very healthy 255,000 net new customer relationships. Business Services has emerged from the pandemic and was also a key driver of our results, and we believe this momentum will continue. Our success comes from our network advantage, innovative products, and world-class operational capabilities, which enable us to provide an unparalleled experience. Just like in residential, we are proactively responding to the needs of our commercial customers and offering personalized solutions. While small business has led our growth for the last decade, we are still significantly under-penetrated in the mid-market and enterprise segments. We see a lot of potential to take share in our large addressable market, which just got even bigger post our recent acquisition of Masergy, which builds on our strong offering of technology solutions. Masergy has become a leading provider to companies worldwide and unlocks a customer segment that we don't have today, particularly U.S.-based organizations with multi-site global operations. Xfinity Mobile exceeded its prior record, adding 285,000 lines, the most in any quarter since launch. And we continue to evaluate ways we can accelerate this business even further as wireline and wireless connectivity services continue to converge. We are looking at new, exciting products and packaging that highlight how we're able to provide our customers with the best and most reliable broadband, wherever they are or wherever they go, and help them save money at the same time. And with only 6% penetration of our 32 million broadband customers, we have a long runway. Taking all of this together, we have an incredibly robust broadband business And we've been adding over a million broadband customers each year for the past 20 plus years. And we continue to deepen these relationships by offering a fantastic and differentiated in-home experience with the fastest modem and gateway and the greatest Wi-Fi coverage. We plan to continue our relentless focus on aggressively developing and improving our suite of products around connectivity. The foundation of all of this is our network, and we are currently in the process of deploying new technology, updating key infrastructure, and accelerating virtualization across our footprint so that we can deliver even further enhancements fast and at scale to millions of customers. and we will continue to evaluate every opportunity we have to expand our passings, which will bring our amazing suite of products and services to many new homes and businesses. All of Dave Watson and his team's superb execution is around decades of investment that has led to constant new product innovation, including this month's launch of X-Class TV, an extension of our leadership in video aggregation. XClass is an innovative, smart television powered by our global technology platform that brings the best of our company's entertainment operating system to consumers nationwide, together with the option to use either Xfinity, Charter, or other entertainment apps. At NBCUniversal, we continue to see great progress in each of our businesses, But I'd like to highlight our theme parks, especially Orlando, which just reported the most profitable quarter in its history, despite having virtually no international guests due to COVID-related travel restraints. In Hollywood, we continue to see recovery, and we had a very successful and exciting opening of Universal Beijing Resort on September 20th. I also look forward to COVID-related restrictions easing in Osaka this which could happen soon. Our media business is also doing very well. We're benefiting from the many changes Jeff Schell and his team implemented starting in 2020, with new hires, different roles, fresh content, and a more efficient operating structure. We're seeing the financial success in both our linear networks as well as Peacock, which has maintained its momentum. We have a new breakout hit with La Brea, which has been a contributor to NBC's overall audience lead this primetime season, as well as the best performing new show on Peacock. Sunday Night Football has returned with great momentum, which we're seeing across our platforms. And we're thrilled with the performance of our second Halloween installment, which generated more revenue in its opening weekend at the domestic box office than any other film this year with a day-and-date streaming release, and is the number one non-live event premiere in Peacock's history. We're also looking forward to extending our streaming platforms outside of the U.S., with Peacock launching on Sky next month and Sky Showtime in the works for mid-2022. At Sky, I want to reemphasize how well we're performing in the UK, which continues its growth trajectory in customer relationships, led by record low churn. We're also seeing great momentum in our broadband and mobile businesses. Earlier this month, Dana Strong and her team introduced Sky Glass in London. a premium all-in-one streaming television and multi-channel subscription package that is so much more than just a stunning TV with amazing sound. It's an innovation platform that opens up a whole new world of entertainment for our customers and simplifies the experience so they can stream every channel, every show, and every app in one easy-to-use interface. And already, the customer response has very much exceeded our initial expectations. We're also incredibly proud that Sky Glass is the first TV to be certified carbon neutral. Sky has been leading all of Comcast with its sustainability goals and is the first media company in the UK to commit to being net carbon zero by 2030. While Glass and X-Class are distinct products with different monetization and distribution strategies, they extend our customer base beyond our previous capabilities and they run off the same global technology platform. This allows us to quickly bring the best features to consumers across territories, segments, and brands, and on Comcast hardware and through our syndication partners. I'm pleased to also announce today that Apple will bring Apple TV Plus and the Apple TV app to our Xfinity and Sky customers on X1, Flex, X-Class, Sky Glass, and Sky Q devices, and Comcast is bringing the Xfinity Stream and Sky Go apps to Apple TV devices. We're working together with our partners to deliver the best apps and experiences on our platforms, and our teams are sharing capabilities and collaborating across the company, collectively drawing on our scale and leadership in broadband, aggregation, and streaming. to innovate and profitably serve new and existing customers. Looking ahead, I am excited about the opportunities we have to both invest in our business and return capital through buybacks and dividends, all while maintaining leverage around current levels. And I believe we are extremely well positioned to continue our track record of building long-term shareholder value. So I'm pleased to now hand it over to Mike for more detail on this strong quarter.