JUAN SERRANO CEO OF GRUP BALFEGÓ
Manel and Pere Vicent Balfegó, cousins and founders of the company Balfego Are fifth generation members of a large fishing family originating from L’Ametlla de Mar in Tarragona, Spain. In the 80s, they harnessed their vision and decided to invest their time and energy exploring the possibilities of a bluefin tuna fishery. After many years of enquiry, hard-work and investment, they have gone on to establish themselves as the world’s leading company in terms of the understanding, capture, breeding, fishing, production and distribution of bluefin tuna.
Balfegó wild tuna live in pools off the coast of L’Ametlla de Mar. For up to a year they live here, feeding exclusively on wild fish. Dedication has now brought Balfego well earned product recognition, a benchmark of excellence establishing them as the only company in the world which extracts tuna from the sea at its optimum point of fat, dependent on customer demand. The extraction method used at Belfego guarantees a stress-free product, without ‘yake,’ which in Japanese means ‘burned meat,’ offering customers therefore a product of excellent gastronomic value as now found in many of the world’s best restaurants.

Juan Serrano – CEO
GRUP BALFEGÓ
ABOUT JUAN SERRANO, CEO OF GRUP BALFEGÓ
Career path
I began my professional career at Philips Lighting, in the Procurement and Stock Management and Production Planning departments. Later, I went on to direct a project, a small snack and chips company that was later sold to the Arroz Sosarana Group, which I a shareholder in, and a member of the Board of Directors as Group Secretary. After that, I joined KH7, a company that, during my time, came to be the leader in the kitchen cleaners and degreasers segment. Next, I set up a business providing clients strategic advice and human resource selection and management. I was also part of Forenqui Laboratories. Later I was in a construction company and finally I joined Grup Balfegó in 2007.
Early days in Balfegó
I started as an external consultant advisor to Balfegó. This came about through Xavier Subirats, a former fellow student who is now Vice-Dean of the Catalonian Economists Society. Initially, I used to come in one day a week, later two, then three … Eventually I was working there full time, leaving behind other projects. I have been at Balfegó since then, in the position of the Group Managing Director.
What was the company like when you arrived?
It was a company with a particularly modern structure, a building that was only a year old, wonderful offshore facilities… but the company sold exclusively to, and dedicated itself 100% to Japan, and because of this, the product became a commodity. Our activity began with fishing the live fish. These captured tuna were fattened between July and October, and sold in October to November. This meant that we had to wait for the following year’s fishing season to have more specimens available to sell. In view of these unproductive periods, we elected for the fresh consumption strategy, adjusted to customer demand. Little by little, we were exporting to 32 countries in the world, quickly becoming the world’s leading company in fresh consumption.
At the structural and organizational model level, we also implemented a total transformation in which technology and innovation played a primary role.
We started investing in research, becoming a very powerful source of knowledge about bluefin tuna. So much so, that we were the first to intervene in the tuna reproduction cycle, proposing fishery control measures. In the end, we became a spokesperson that the media went to when they needed to learn about the species and the sector.
In addition, we design a marketing strategy to create a brand of considerable international prestige. This included a traceability system to monitor ourselves and used technology to provide information (weight, size, date of capture, fat percentage and all the itemised health and microbiological certificates), both to the chefs and end consumers alike.
In addition, we are the only ones who routinely specify the level of fat in each individual tuna, and so are able to optimally attend to the taste preferences of our customers.
How is Balfegó nowadays, and what are the perspectives for the future?
At a commercial level, we can say that we are a leading company, internationally recognized. We have a presence in some of the best restaurants in the world in more than 32 countries, and are a pioneer in the marketing of fresh bluefin tuna. Balfegó is a company that functions under a well-implemented integrated management system with procedures that makes us increasingly efficient. We perpetuously seek to improve the tasks involved in all these procedures, continuously improving existing indicators. In the future, I see us opening up in other areas apart from the restaurant sector where we have been from 2009 until now. Little by little, I see us adding retail outlets, specialized in the gourmet area.
What role does the R + D + i department play in Balfegó?
It is the department, let’s say, at the cutting edge. If we had not gotten to know our product, its biology and its behaviour in its natural environment in the sea, surely today we would be in the position we are in. We would not have been able to give recommendations on tuna fishery management. We have been pioneers in this regard, thanks to all our investment in marine research.
On top of all of this, we should highlight that we have also been at the forefront of research and innovation once the tuna leaves the water. We have learned, by measuring the PH, to control the lactic acid that a tuna secretes after slaughtering, and we were pioneers when it came to measuring fat content. As a direct result of this research, we feed tuna exclusively on blue fish and in this way, adapting the taste in terms of the fat level, to meet the requirements of customers from different parts of the world. In addition, we are in some way able to guarantee the health and food safety of our products. Without a doubt, pioneers in total traceability from the sea to the consumer’s table.
How important have the fish husbandry facilities been in Balfegó’s transformation?
There are two important considerations. The first one is that bringing a seasonal product to market that can only be fished during a short period of time can cause prices to fall. Having fish husbandry facilities available allows us to regulate supply and demand. If, at the other end of the supply chain, there is no-one who wants that tuna, we will never slaughter it. And the second aspect is improving the quality of the tuna we fish. When tuna come to the Mediterranean to spawn, they have lost a large proportion of fat during the journey. It is important that they recover it, because it is in this fat that the quality of the tuna resides. These are the two mainstays.
Movistar, Telefónica, Yoigo and Cellnex, the Spanish companies that were already in the ranking
Euskaltel enters the Brand Finance ranking of the world’s most valuable telecommunications brands
- The Spanish presence in the sectorial ranking of telecommunications brand value increases. Euskaltel joins Movistar, Telefónica, Yoigo and Cellnex among the most valuable brands in the world.
- The two brands of the Telefónica Group, Movistar and Telefónica, decrease in value and brand strength but continue to be the first among the Spanish ones.
- Yoigo is the only Spanish in the ranking that increases both in value (20.1%) and in brand strength (+4 points). Cellnex is the one with the greatest increase in brand value (28.4%).
- The 150 brands in the sector have lost a cumulative 68 billion in brand value compared to 2020.
- Verizon extends lead ahead of AT&T as the world’s most valuable telecommunications brand, brand value increased 2% to 58.6 billion euros.
- Jio shines as the strongest and fastest growing in the world on the Brand Strength Index (BSI) with a score of 91.7 out of 100.
Access the full Brand Finance Telecoms 150 report here.
Madrid, February 23, 2021.- Euskaltel is already among the most valuable Spanish telecommunications companies in the world according to the report that assesses the 150 most valuable international brands in the sector, Telecoms 150 2021 from Brand Finance , the leading independent consultancy in valuation of intangibles whose rankings comply with the ISO 10668 and ISO 20671 of valuation and evaluation of brands respectively and that contributes with its brand value database to create one of the indicators of the UN Global Innovation Index (GII) . The American Verizon leads the brand value ranking with a value of 58.6 billion euros, + 2% compared to 2020.
With the Euskaltel Euskadi team back in “LaVuelta” after 8 years and results 24.5% higher than 2020 despite the coronavirus year, the Euskaltel brand is living a good brand trajectory, so much so that this year it has managed to enter the list of the most valuable in the world in a sector as competitive and internationally atomized as telecommunications. This year it has distributed a dividend of 25 million among its shareholders. According to the company, this would be the fifth consecutive year that it has managed to do so since it went public in 2015. In addition, it has signed a brand license agreement with the Virgin Group to use the Virgin brand ,one of the most recognized and respected brands in the world, in Spain and thus promote its national expansion strategy. The Virgin brand will coexist with the Group’s three established brands (Euskaltel, Telecable and R), which will continue to provide leading services in each of their respective regions. Euskaltel believes that the combination of its strong regional brands with the Virgin brand, which it will use at the national level, will provide excellent growth opportunities.
Teresa de Lemus , Managing Director of Brand Finance Spain : “Despite the isolation mitigated by calls and the increase in content consumption, the most valuable Spanish telecommunications brands have gone from a brand value of 11.0 billion euros to a value total mark 9.1 in one year¨
Brand value | ||||
Mark | Brand Value Ranking 2021 | Brand Value Ranking 2020 | Variation in Brand Value Ranking | Brand Value Variation |
Movistar | 17 | 13 | -4 | -22.7% |
Telephone | 68 | 64 | -4 | -20.4% |
Yoigo | 115 | 131 | 16 | 20.1% |
Cellnex Telecom | 123 | 144 | twenty-one | 28.4% |
Euskaltel | 145 | New | 12.9% |
Telefónica and Movistar, both brands of the Telefónica group, this year were hard hit by COVID-19, and this has been reflected in the value and brand strength of both firms. Both companies, the most valuable telecommunications companies in Spain, fell 4 places in the sector ranking to 68 and 17 respectively. Despite continuing to be the first Spanish to appear in the ranking (they are still among the first 100 in positions 17 – Movistar- and 68 -Telefónica- in terms of brand value) both companies have decreased their value by more than 20% ( -22.7% Movistar and -20.4% Telefónica).
The outlook for the group in the coming years is not very encouraging according to our analysts and the group is expected to experience lower growth in the next period. Despite the challenging environment, Telefónica remained at the forefront of developments in the sector. Its 5G network was activated with the goal of achieving 75% coverage by the end of the year in line with the brand’s message of “reaching as many households as possible.” Telefónica has suffered a setback in the field of play when the regulatory body, CNMC, has just ruled that the Spanish operator, the owner of the rights, will continue to be obliged to share them with its rivals, Orange between them, whether they want to or not, until 2023. They also launched “Movistar Salud” and performance improvements were implemented for “Movistar Prosegur Alarmas”.
Both Yoigo and Cellnex are among the 10 brands that have grown the most in brand value. The significant expansion of the Cellnex Group’s geographic footprint (Portugal, France, the UK and Poland) is the main reason for the firm’s rapid revenue growth despite the rumors of a possible merger with American Towers . Yoigo, for its part, has seen its brand value increase thanks to the increase in the income of the Masmóvil Group , of which it is part.
Teresa de Lemus, Managing Director of Brand Finance Spain: “Perhaps we will soon see other Spanish companies in the ranking, such as Red Eléctrica, which proposes the entry of new partners for the telecommunications business built around Hispasat and the fiber optic subsidiary Reintel. “
Brand Strength Ranking
At Brand Finance we establish the Strength of the Brand, the second most important variable in addition to the Brand Value, according to three factors: “Income”, activities that support the future strength of the brand; “Fairness”, actual current insights from our market research and other data provider partners.
Brand Strength | ||||||
Mark | Qualification 2021 | 2020 qualification | Brand Strength Ranking 2021 | Brand Strength Ranking 2020 | Brand Strength Ranking Variation | Brand Strength Variation |
Movistar | AA + | AAA- | 65 | 40 | -25 | – 4.0 |
Telephone | A + | A + | 138 | 119 | -19 | – 4.0 |
Yoigo | AA | AA- | 103 | 107 | 4 | 2.6 |
Cellnex Telecom | A + | AA- | 122 | 113 | -9 | – 1.4 |
Euskaltel | AA- | A + | 114 | New | 5.7 |
This indicator has been negative for Movistar, Telefónica and Cellnex this year, with the two Telefónica Group brands falling 4 points, which fell 25 and 19 places in the strength ranking respectively, and -1.4 points from Cellnex Telecom, which fell 9 places to 113 Euskaltel is, of the Spanish companies, the one that registered the greatest increase (+5.7 points) followed by Yoigo (+2.6 points).
A sector that loses brand value and strength
The 150 brands in the sector have lost an accumulated 68 billion in brand value compared to 2020. In 2020, the 150 brands in the sector added an accumulated 624,742 million in 2020 compared to the 556,705 million recorded in this report.
The trend is reflected in Spanish brands. The 5 brands of 2021, including Euskaltel, add up to a total of 9.1 billion euros, -1.9 billion less than the sum of the value of the 4 Spanish brands that appeared in 2020, which amounted to 11.0 billion of euros.
In Spain, many operators put themselves at the service of their customers, including Movistar, the first to offer free content to their customers during the pandemic. All these actions affect the brand evaluation, so we will see the real impact on the brand strength index and its brand value in the coming years.
Verizon Retains No. 1 Ranking Worldwide and Region-wide
For the second year in a row, Verizon has been awarded the title of the world’s most valuable telecommunications brand after a 2% increase in brand value to 58.6 billion euros. This growth in brand value has not only driven it once again to position itself among the top 10 most valuable brands globally in the Brand Finance Global 500 2021 ranking , but has meant that the brand has continued to expand the gap that separates it from AT&T in second place (brand value down -18% to € 43.7 billion). A further 15 US brands are featured in the Brand Finance Telecoms 150 2021 ranking, with a combined brand value of € 150.6 billion.
From the 2 years ago when Verizon’s business transformation program began, Verizon 2.0 – focused on network transformation, go-to-market, brand, and business culture – the brand continues to make giant strides across the industry. The giant is widely recognized for being, among those in its category, the one with the best network and the widest coverage in the United States. And network usage increased during the pandemic, handling a staggering 800 million phone calls and 8 billion text messages a day. Verizon is making significant progress in its 5G expansion program, which now reaches more than 2,700 cities and 230 million people.
Teresa de Lemus, Managing Director Brand Finance Spain: “The Verizon brand is leveraging its brand strength to increase customer differentiation by migrating to unlimited plans and increasing adherence to content and partnerships such as Disney +, Apple and Discovery plus.”
Despite a 35.1% drop in brand value, making it the eighth fastest-falling brand in Brand Finance Telecoms 150 2021, Vivo (€ 1.3 billion brand value), is the most valuable telecommunications brand in South America. With the largest share of the Brazilian telecommunications market, Vivo is the leading fixed and wireless telephony brand in the country, even though it has been through difficult times in the last year due to the pandemic. However, the brand has taken steps towards innovation, using artificial intelligence to provide data that allows the Brazilian government to track the spread of COVID-19 throughout the country.
Other telecommunications brands in South America have also had complicated results such as the Argentine Personal (brand value of 215 million euros), which caused the brand to lose 55.8% of its value, becoming the third brand to suffer the most ranking drop. Personal’s Brazilian neighbor, Oi, is the fourth brand that has fallen the most, up 38.8% to 362 million euros. The brand has been plagued with financial problems in recent years, initially filing for bankruptcy in 2016 and running losses since. This has been compounded by the low levels of consumer recommendation and consideration we saw in our Brand Finance Global Brand Equity Monitor study, which has led to a decline in brand strength, as the Strength Index score of Oi’s brand (BSI) currently reaching 63.0 out of 100. The story is similar for the Chilean brand, VTR, which is the seventh brand that falls the most in the ranking this year, falling by 35.2% less, reaching 221 million euros. VTR’s drop in brand value is primarily attributed to a slight decline in revenue and an increase in weighted cost of capital over the past year.
Deutsche Telecom is crowned the most valuable brand in Europe
With a brand value of 43.5 billion euros, Deutsche Telekom has maintained its position as the most valuable telecommunications brand in Europe, moving up one place in the Brand Finance Telecoms 150 2021 ranking to third place. Following an impressive 20.6% growth in brand value, the fastest growing brand in the top 10, far outpacing the second fastest growing brand, Spectrum , which increased 4.8% to 18.2 billion euros.
As the largest telecommunications provider by revenue in Europe, Deutsche Telekom has reaped the rewards of its harvest by expanding to ultra-fast internet connections and increasing the popularity of its MagentaENIS service package. Last year, the German telecommunications brand also completed the merger of T-Mobile and Sprint in the US, which has significantly bolstered its total revenues, even despite the COVID-19 pandemic. With a successful merger under its belt, the telecoms giant is now looking back to Europe for further expansion, an effort likely to lead to greater success in the coming year.
Jio shines as the fastest growing and strongest brand in the world
In addition to measuring overall brand equity, Brand Finance also assesses the relative strength of brands, based on factors such as marketing investment, customer perceptions, employee satisfaction, and corporate reputation. Along with revenue forecasts, brand strength is a crucial factor in brand equity.
Indian telecom giant Jio is shaking up the industry as the world’s strongest telecom brand, with a Brand Strength Score (BSI) of 91.7 out of 100 and a Brand Strength rating of AAA +.
Despite its recent founding in 2016, Jio has quickly become the largest mobile network operator in India and the third largest mobile network operator in the world, with nearly 400 million customers. Renowned for his incredibly affordable plans, Jio took India by storm by offering 4G to millions of users for free, simultaneously transforming the way Indians consume the internet, which is even known as the ‘Jio effect’.
The dominance of the brand across the country is also evident in the results of the market research conducted by Brand Finance. Jio scores highest on all metrics – Conversion Consideration, Reputation, Recommendation, Word of Mouth, Innovation, Customer Service, and Value for Money – compared to its telecom competitors in India. The brand does not have major weaknesses within the sector and, unlike other telecom brands globally, Jio has shown that it has broken the mold and enjoys genuine affection from consumers.
In addition to being a prominent brand for its brand strength, Jio is the brand that has grown the most in the ranking in terms of brand value, breaking the negative trend present throughout the industry, with an increase from 41.5% to 4.1 thousand millions of euros.
The Indian brand Airtel also celebrated a strong year, jumping 12 points in the ranking to 23rd after increasing the brand value of 28.3% to 5.2 billion euros.
Despite registering a 27.8% drop in brand value, China Mobile (€ 32 billion brand value) remains the most valuable brand in the region, followed by China Telecom (down -37 , 4% brand value to 11.3 billion euros) and China Unicom (down -20% to 6.7 billion euros). Despite being in the Top 20 of Brand Finance Telecoms 2021, China’s top three telecom brands experienced more significant losses in brand value than any of their Chinese competitors.
There are several reasons for China’s declining performance within the sector, namely the decline in the number of subscribers, including large-scale cancellations of business phone numbers, and the torrential rain that resulted in some of the worst flooding in the region in more than two decades. In the first quarter of 2020 alone, China Mobile lost four million users and China Unicom lost 7.5 million. Additionally, the mid-year floods affected nearly a quarter of a million people, with 41,000 homes destroyed when the floods washed away buildings and telecommunications infrastructure.
MEA brands stand out for innovation
Etisalat has been crowned the strongest telecommunications brand in the MEA, with a Brand Strength Index (BSI) score of 87.4 out of 100 and a AAA brand strength rating, the only brand in the region to achieve this rating.
Thanks to its strategy in recent years and its recent achievement of becoming the fastest network on the planet, the brand was in a position to respond immediately to the ‘new normal’ of the pandemic, providing solutions and flexibility in a way that connect emotionally with consumers. Etisalat Group is aiming to become a truly global player.
Teresa de Lemus , Managing Director of Brand Finance Spain :
“When COVID hit in 2020, Etisalat led from the front in ensuring business continuity, robust e-government, enabling smart cities and remote learning, to help drive the UAE’s digital future. By maintaining visibility and providing the nation with the fastest network on the planet, Etisalat has earned its place as the strongest brand in the region. “
STC is the most valuable brand in the region, its brand value rose 7.5% to 7.7 billion euros, simultaneously jumping 5 positions to 13th in the ranking. STC has recently doubled the capacity of its network, without ever compromising on customer service, something the brand takes great pride in. The brand has also achieved a AAA brand rating for the first time due to its branding and business transformation. With an increase of 4.4 points of strength, it rises an impressive 22 positions in the BSI ranking.
Note to editors
Every year, Brand Finance tests 5,000 of the largest brands, assessing their strength and quantifying their value, and publishes nearly 100 reports, ranking brands across sectors and countries. The 150 most valuable telecommunications brands in the world are included in the Brand Finance Telecoms 150 2021 report.
The full Brand Finance Telecoms 150 2021 ranking, additional information, charts, more information on the methodology, as well as definitions of key terms are available in the Brand Finance Telecoms 150 2021 report.
The brand value is defined as the net economic benefit the owner of a brand to achieve the grant brand license in the open market. Brand strength is the effectiveness of a brand’s performance on intangible measures relative to its competitors. See below for a full explanation of our methodology.
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About Brand Finance
Brand Finance is the leading independent, international consulting firm in brand valuation and strategy, with offices in 20 countries. We create bridges between the areas of marketing and finance. We provide clarity to marketers, brand owners and investors when quantifying the financial value of a brand. For our experience in strategy; branding; market research; Visual identity; finance; Tax aspects and intellectual property, at Brand Finance we support the client to make the right decisions that optimize the value of a brand and the entire company by building bridges between marketing and finance.
Every year, the independent brand valuation consultancy Brand Finance values the most important brands in the world. More details on the methodology and terminology, as well as the definitions of terms can be found on our Brand Finance website .
Brand Finance collaborated in the development of the international standard on financial valuation of brands, ISO 10668, as well as in the recently approved standard on brand assessment, ISO 20671. Brand Finance is under the ICAEW regulations as a public accounting firm and is the first consulting firm in brand valuation to be part of the international committee on valuation standards, IVSC.
Methodology
Brand definition
The brand is defined as an intangible asset related to marketing that includes, among others, names, terms, signs, symbols, logos and designs, intended to identify goods, services or entities, creating images and distinctive associations in the minds of the parties interested. , thus generating economic benefits.
Brand value
Brand equity refers to the present value of earnings specifically related to brand reputation. Organizations own and control these profits by owning trademark rights.
All brand valuation methodologies are essentially trying to identify this, although the approach and assumptions differ. As a result, the published brand values may be different.
These differences are similar to the way that equity analysts provide business valuations that are different from each other. The only way to discover “real” value is by looking at what people actually pay.
As a result, Brand Finance always incorporates a review of what brand users actually pay for brand use in the form of brand royalty agreements, found in more or less every industry in the world.
This is sometimes referred to as the “Royalty Relief” methodology and is by far the most widely used approach to brand valuations as it is grounded in reality.
It is the foundation of a public ranking, but we always augment it with a real understanding of people’s perceptions and their effects on demand, from our market research database on 3,000+ brands in 30+ markets.
Brand valuation methodology
For our ratings, Brand Finance uses the simplest and easiest-to-understand method possible to help readers understand, gain confidence, and actively use brand ratings.
Brand Finance calculates the values of brands in their rankings using the Royalty Relief approach, a brand valuation method that meets the industry standards set out in ISO 10668.
Our evaluation of the Brand Strength Index or Brand Strength Index, a comprehensive scorecard of brand-related measures, also complies with ISO standards (ISO 20671) and works as a predictive tool of future changes in brand value and a dashboard to help companies improve marketing.
We do this in the following four steps:
- Brand impact. We review what brands already pay in royalty agreements. This is augmented by an analysis of how brands impact profitability in the sector versus generic brands. This results in a range of possible royalties that could be charged in the industry by brands (for example, a range of 0% to 2% of revenue)
- Brand strength. We adjust the rate higher or lower for brands by analyzing Brand Strength. We analyze the strength of the brand by looking at three main pillars: “Income”, which are activities that support the future strength of the brand; “Fairness”, which are actual current insights from our market research and other data partners; “Product”, which are brand-related performance measures, such as market share. Each brand is assigned a Brand Strength Index (BSI) score of 100, which feeds into the calculation of brand equity. Based on the score, each brand is assigned a corresponding brand rating up to AAA + in a format similar to a credit rating.
- Brand impact x Brand strength. The BSI score is applied to the royalty range to arrive at a royalty rate. For example, if the royalty range in a sector is 0-5% and a brand has a BSI score of 80 out of 100, then an appropriate royalty rate for the use of this brand in the given sector will be 4%.
- Forecast of the calculation of the brand value. We determine brand-specific revenue as a proportion of parent company’s revenue attributable to the brand in question, and we forecast that revenue by analyzing historical revenue, capital analyst forecasts, and economic growth rates. We then apply the royalty rate to the expected revenue to derive the brand’s revenue and apply the relevant valuation assumptions to arrive at an after-tax discounted present value equal to the brand’s value.
Disclaimer
Brand Finance has produced this study with an independent and unbiased analysis. The derived values and opinions presented in this study are based on publicly available information and certain assumptions Brand Finance used when such data was poor or unclear. Brand Finance accepts no responsibility and will not be liable in the event that publicly available information subsequently relied upon is inaccurate. The opinions and financial analysis expressed in the study should not be construed as investment or business advice. Brand Finance does not intend to trust the study for any reason and excludes all liability to any body, government or organization.
The data presented in this study is part of Brand Finance’s proprietary database, provided for the benefit of the media, and should not be used in whole or in part for any commercial or technical purpose without the written permission of Brand Finance.
Anne-Charlotte Bellanger | Managing Director France, United Kingdom & Iberia
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Anne-Charlotte Bellanger | Managing Director France, United Kingdom & Iberia
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eBay Inc. Names Jamie Iannone Chief Executive Officer
Highly Accomplished Leader with Proven Track Record of Driving Superior Performance and User Experiences at Consumer-Facing Technology Companies

eBay Inc. (NASDAQ: EBAY) today announced that the Company’s Board of Directors has appointed Jamie Iannone as Chief Executive Officer, effective April 27, 2020. He has also been elected to the Company’s Board of Directors. Most recently Mr. Iannone was Chief Operating Officer of Walmart eCommerce.
Mr. Iannone has over 20 years of experience leading digital pure-play and omnichannel platforms for some of the world’s premier consumer-facing companies. Before being promoted to COO of Walmart eCommerce, he served as CEO of SamsClub.com, the eCommerce unit for the $57 billion Sam’s Club. In this role, he was responsible for the unit’s digital transformation, including developing and executing initiatives in membership, marketing, technology, product and operations. Mr. Iannone previously worked at eBay as a Vice President and other leadership roles from 2001 to 2009.
“The Board believes Jamie is the ideal CEO to lead eBay’s next chapter of growth and success,” said Thomas Tierney, Chairman of eBay Inc.’s Board. “We have all been impressed by his strong track record of innovation, execution, operational excellence, and developing teams that drive results. Jamie has consistently delivered high growth during rapid periods of industry disruption, consumer change and technological advancement. He is a world-class leader, and we are excited to welcome him back to eBay.”
“I am honored to rejoin eBay as its next Chief Executive Officer,” said Mr. Iannone. “In my previous experience with the Company, I developed a deep appreciation for what makes eBay so special. eBay’s success has always been rooted in its robust C2C platform. I believe the Company has tremendous opportunities to capitalize on this foundation, innovate for the future and grow its ecosystem. I look forward to working with our global teams to enhance buyer experiences and provide more capabilities that will help small businesses sustain and grow. I will focus on continuing to evolve the Company’s strategy while delivering on eBay’s commitment to maximize long-term shareholder value.”
Mr. Tierney added, “We are deeply appreciative to Scott Schenkel for his leadership, not only over the past six months as interim CEO, but also during his 13-year tenure at eBay. In addition to leading bold actions in response to the COVID-19 pandemic, with Scott as interim CEO, eBay has re-prioritized its product roadmap, scaled growth initiatives, significantly improved margins and positioned the Company for enhanced shareholder returns. On behalf of the Board and the entire eBay family, we extend our sincerest gratitude to Scott for a job exceptionally well done.”
Mr. Schenkel will continue as interim CEO until Mr. Iannone joins the Company on April 27, 2020 and will thereafter work with Mr. Iannone to ensure a smooth transition of leadership. Andy Cring will continue to serve as interim CFO.
Mr. Iannone’s appointment marks the end of a comprehensive search process led by a dedicated committee of eBay’s Board of Directors and supported by outside executive search and leadership advisory firm Spencer Stuart. The Search Committee, comprised of Fred Anderson, Katie Mitic, Matt Murphy, Paul Pressler and Tom Tierney, led an extensive evaluation of external and internal candidates for the role. The full eBay Board unanimously supported Mr. Iannone’s selection as CEO.
About Jamie Iannone
Mr. Iannone most recently served as Chief Operating Officer of Walmart eCommerce. His team focused on operational oversight of eCommerce as Walmart moves to a truly omnichannel organization. He also had responsibility for Store No. 8, Walmart’s incubation hub.
Mr. Iannone joined Sam’s Club in 2014 and was CEO of SamsClub.com and Executive Vice President of membership and technology. In that role, Mr. Iannone grew both the SamsClub.com business and Sam’s Club’s membership base, which ended FY20 with record-high eCommerce growth and Plus renewal counts. His teams also released industry-leading technologies including Scan & Go, Ask Sam’s, Sam’s Club Now and Club Pickup.
Before joining Walmart Inc., Mr. Iannone was Executive Vice President of Digital Products at Barnes & Noble, Inc., where he was responsible for all NOOK devices, software, accessories, retail integration and experiences, books and digital content, as well as third-party partnerships. He also spent nearly eight years at eBay as a Vice President and in other roles leading several areas of the Company, including its global search, buyer experience and tailored shopping experience divisions. Before that, Mr. Iannone worked at Epinions.com and Booz Allen Hamilton.
Mr. Iannone previously served on the Board of Directors of The Children’s Place. He earned a Bachelor of Science in operations research, engineering and management systems from Princeton University and a Master of Business Administration from the Stanford Graduate School of Business.
About eBay
eBay Inc. (Nasdaq: EBAY) is a global commerce leader including the Marketplace and Classifieds platforms. Collectively, we connect millions of buyers and sellers around the world, empowering people and creating opportunity for all. Founded in 1995 in San Jose, California, eBay is one of the world’s largest and most vibrant marketplaces for discovering great value and unique selection. For more information about the company and its global portfolio of online brands, visit www.ebayinc.com.
Forward-Looking Statements
This press release contains forward-looking statements that are based on the company’s current expectations, forecasts and assumptions and involve risks and uncertainties. These statements include, but are not limited to, statements regarding the future performance of eBay Inc. and its consolidated subsidiaries, including full year guidance for 2019, leadership changes and the company’s operating and strategic reviews. Actual results could differ materially from those predicted or implied, and reported results should not be considered as an indication of future performance. Other factors that could cause or contribute to such differences include, but are not limited to: changes in political, business and economic conditions, any regional or general economic downturn or crisis and any conditions that affect ecommerce growth or cross-border trade; the company’s ability to realize expected growth opportunities in payments intermediation and advertising; the outcome of the operating and strategic portfolio reviews; fluctuations in foreign currency exchange rates; the company’s need to successfully react to the increasing importance of mobile commerce and the increasing social aspect of commerce; an increasingly competitive environment for its business; changes to the company’s capital allocation, including the timing, declaration, amount and payment of any future dividends or levels of the company’s share repurchases, or management of operating cash; the company’s ability to manage its indebtedness, including managing exposure to interest rates and maintaining its credit ratings; the company’s need to manage an increasingly large enterprise with a broad range of businesses of varying degrees of maturity and in many different geographies; the company’s need and ability to manage regulatory, tax, data security and litigation risks; whether the operational, marketing and strategic benefits of the separation of the eBay and PayPal businesses can be achieved; the company’s ability to timely upgrade and develop its technology systems, infrastructure and customer service capabilities at reasonable cost while maintaining site stability and performance and adding new products and features; and the company’s ability to integrate, manage and grow businesses that have been acquired or may be acquired in the future.
The forward-looking statements in this press release do not include the potential impact of any acquisitions or divestitures that may be announced and/or completed after the date hereof.
More information about factors that could affect the company’s results is included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the company’s most recent Annual Report on Form 10-K and subsequent quarterly reports on Form 10-Q, copies of which may be obtained by visiting the company’s Investor Relations website at https://investors.ebayinc.com or the SEC’s website at www.sec.gov. Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to the company on the date hereof. The company assumes no obligation to update such statements.
Pinterest Inc: Social Media Stock Up 33% Since Reporting Q3 Revenue
Pinterest Stock Up 223% Year-over-Year & 2021 Could Be Even Better
Pinterest Inc (NYSE:PINS) is a great social media tech stock that has done well during the coronavirus pandemic. PINS stock is up 223% year-over-year, 257% year-to-date, and 560% since hitting March lows. It’s also up 250% from its April 2019 initial public offering (IPO) price.
A number of COVID-19 vaccines have been reported in the news, and more will follow, but the fact is, online companies like Pinterest will continue to do well in the post-pandemic world.
The economy will return to some form of normalcy in 2021, but the coronavirus pandemic has changed the way consumers shop and people interact with one another. And when it comes to digital marketing, Pinterest Inc is an advertiser’s dream.
Pinterest is a web site where users “pin” their favorite home and style ideas, recipes, wellness tips, and virtually anything they find on the Internet. The joy for advertisers is, they have a captive audience who just need to click on a pin to buy something.
“Pinners” (which is what Pinterest users are called) might go on the site merely to get ideas, but they often end up buying something. In the digital age, that kind of convenience is not something consumers will want to give up.
And the numbers back that up.
In late October, Pinterest Inc reported strong third-quarter revenue and user growth. And management expects fourth-quarter revenue to grow 60% year-over-year.
That kind of growth might be tough to sustain over the coming quarters, but Pinterest has emerged as leading Internet content and social media platform, which will likely continue to provide investors with long-term growth.
Investors believe Pinterest stock has a lot of room to grow. As of this writing, PINS stock is trading hands at $66.46, climbing an additional 33% since the company reported its third-quarter financial results.
Chart courtesy of StockCharts.com
Strong Third-Quarter Results
Pinterest announced that its third-quarter revenue for the period ended September 30 increased 58% year-over-year to $443.0 million. (Source: “Q3 2020 Letter to Shareholders,” Pinterest Inc, October 28, 2020.)
In the quarter, the number of monthly active users (MAUs) grew 37% year-over-year to 442 million. In the U.S., the company’s MAUs increased by 13% to a record 98 million. Internationally, its MAUs increased by 46% to a record 235 million.
Pinterest Inc’s average revenue per user (ARPU) increased significantly to $1.03, compared to $0.90 in the third quarter of 2019. The expansion in its global APRU was driven by an increase in advertising demand on the company’s platform, partially offset by an increase in MAUs.
By region, the company’s U.S. ARPU was up 31% year-over-year, at $3.85, while its international ARPU was up 66%, at $0.21. Pinterest noted that its international ARPU remains in its early stages, as the company has only begun to execute its strategy to provide targeted ads to Pinners in countries other than the U.S.
Pinterest Inc reported a third-quarter 2020 net loss of $94.0 million ($0.16 per share), compared to a third-quarter 2019 net loss of $125.0 million ($0.23 per share). The company reported third-quarter adjusted net income of $87.1 million, compared to $6.0 million in the same prior-year period.
Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) were $93.0 million, versus adjusted EBITDA of $4.0 million in the third quarter of last year.
Todd Morgenfeld, CFO and head of business operations, commented, “The strong momentum our business experienced in July continued throughout the rest of the third quarter.” (Source: “Pinterest Announces Third Quarter 2020 Results,” Pinterest Inc, October 28, 2020.)
He continued, “We’re extremely pleased with the broad-based strength of our business, driven by recovering advertiser demand as well as positive returns from our investments in advertiser products and international expansion.”
WhatsApp Business App
WhatsApp Business is free to download and was built with the small business owner in mind. The app makes it easy to personally connect with your customers, highlight your products and services, and answer their questions throughout their shopping experience. Create a catalog to showcase your products and services and use special tools to automate, sort, and quickly respond to messages.
WhatsApp can also help medium and large businesses provide customer support and deliver important notifications to customers.
WhatsApp Business API
For medium and large businesses, the WhatsApp Business API powers your communication with customers all over the world, so you can connect with them on WhatsApp in a simple, secure, and reliable way.
Want to go to market with WhatsApp Business API? Partner with one of our global business solution providers who are messaging experts in enterprise business to customer communications. Search the Facebook Partner directory.
Or learn more about solutions for small businesses.
Learn more about WhatsApp Business API.
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Bugatti in the Middle East new Dealer Partner in Saudi Arabia
Together with its new partner SAMACO Automotive, Bugatti celebrates the debut of the Chiron Pur Sport in the Middle East and announces its new showroom in Saudi Arabia
This Sunday, Bugatti announced its new partnership with SAMACO Automotive, one of the leading and most experienced companies in the automotive luxury market in Saudi Arabia. In the first half of 2021 the French luxury car manufacturer will have its first showroom in Riyadh, the capital of Saudi Arabia. For more than 35 years, SAMACO Automotive has been in a strong partnership with the Volkswagen Group, including high-end brands such as Audi, Porsche, Bentley and Lamborghini – an ideal position to enhance Bugatti’s presence in the Saudi Arabian market.
Comcast Reports 3rd Quarter 2020 Results
PHILADELPHIA–(BUSINESS WIRE)–Oct. 29, 2020– Comcast Corporation (NASDAQ: CMCSA) today reported results for the quarter ended September 30, 2020.
“We are nearly eight months into this pandemic – and despite many harsh realities, I couldn’t be more pleased and proud of how our team has worked together across the company to find safe and creative solutions to successfully operate in this environment. We are executing at the highest level; and perhaps, most importantly, accelerating innovation, which will drive long-term future growth. This third quarter, we delivered the best broadband results in our company’s history.
Driven by our industry-leading platform and strategic focus on broadband, aggregation and streaming, we added a record 633,000 high-speed internet customers and 556,000 total net new customer relationships. At the same time, we’re growing our entertainment platforms with the addition of Flex, which has a significant positive impact on broadband churn and customer lifetime value. Our integrated strategy is also driving results in streaming with nearly 22 million sign-ups for Peacock to date, and we are exceeding our expectations on all engagement metrics in only a few months. And Sky continues to add customer relationships at higher prices while reducing churn to all-time lows in our core UK business. Going forward, and as we emerge from the pandemic, we believe we are extremely well positioned to provide seamless and integrated experiences for our customers and to deliver superior long-term growth and returns for our shareholders,” commented Brian L. Roberts, Chairman and Chief Executive Officer of Comcast Corporation.
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($ in millions, except per share data) |
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||||||||||
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3rd Quarter |
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Year to Date |
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Consolidated Results |
2020 |
2019 |
Change |
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2020 |
2019 |
Change |
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|
Revenue |
$25,532 |
|
$26,827 |
|
(4.8 |
%) |
|
|
$75,856 |
|
$80,544 |
|
(5.8 |
%) |
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||||
|
Net Income Attributable to Comcast |
$2,019 |
|
$3,217 |
|
(37.2 |
%) |
|
|
$7,154 |
|
$9,895 |
|
(27.7 |
%) |
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||||
|
Adjusted Net Income1 |
$3,000 |
|
$3,667 |
|
(18.2 |
%) |
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|
$9,436 |
|
$10,754 |
|
(12.3 |
%) |
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|
Adjusted EBITDA2 |
$7,583 |
|
$8,553 |
|
(11.3 |
%) |
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|
$23,640 |
|
$25,822 |
|
(8.5 |
%) |
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||||
|
Earnings per Share3 |
$0.44 |
|
$0.70 |
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(37.1 |
%) |
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|
$1.55 |
|
$2.15 |
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(27.9 |
%) |
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|
Adjusted Earnings per Share1 |
$0.65 |
|
$0.79 |
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(17.7 |
%) |
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|
$2.04 |
|
$2.33 |
|
(12.4 |
%) |
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||||
|
Net Cash Provided by Operating Activities |
$5,228 |
|
$5,191 |
|
0.7 |
% |
|
|
$19,695 |
|
$19,462 |
|
1.2 |
% |
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||||
|
Free Cash Flow4 |
$2,289 |
|
$2,072 |
|
10.5 |
% |
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|
$11,580 |
|
$10,910 |
|
6.1 |
% |
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For additional detail on segment revenue and expenses, customer metrics, capital expenditures, and free cash flow, please refer to the trending schedules on Comcast’s Investor Relations website at www.cmcsa.com. |
3rd Quarter 2020 Highlights:
- Generated Consolidated Adjusted EBITDA of $7.6 Billion, Adjusted EPS of $0.65 and Free Cash Flow of $2.3 Billion
- Cable Communications Total Customer Relationship Net Additions Were 556,000, the Best Quarterly Result on Record
- Total High-Speed Internet Customer Net Additions Were 633,000, the Best Quarterly Result on Record
- Cable Communications Adjusted EBITDA Increased 10.5% Driven by Strength in High-Speed Internet
- Peacock Has Nearly 22 Million Sign-Ups to Date Across the U.S. and Recently Secured Distribution on the Roku Platform
- NBCUniversal Reorganized Its Television and Streaming Businesses Under Mark Lazarus and Cesar Conde with a Centralized Structure Optimizing Content Creation, Distribution and Monetization
- NBCUniversal Completed a Successful Upfront, with Strong Volume Commitments and Higher Pricing
- Sky Customer Trends Improved Sequentially, and Included Net Additions in the U.K.
- Premier League Viewership Reached Record Levels on Sky Sports, Including the Highest Average Season Viewership on Record for the 2019/20 Season and the Highest Daily U.K. Viewership on Record for the 2020/21 Season to Date
Consolidated Financial Results
Revenue for the third quarter of 2020 decreased 4.8% to $25.5 billion. Net Income Attributable to Comcast decreased 37.2% to $2.0 billion. Adjusted Net Income decreased 18.2% to $3.0 billion. Adjusted EBITDA decreased 11.3% to $7.6 billion.
For the nine months ended September 30, 2020, revenue decreased 5.8% to $75.9 billion compared to 2019. Net income attributable to Comcast decreased 27.7% to $7.2 billion. Adjusted Net Income decreased 12.3% to $9.4 billion. Adjusted EBITDA decreased 8.5% to $23.6 billion.
Earnings per Share (EPS) for the third quarter of 2020 was $0.44, a decrease of 37.1% compared to the third quarter of 2019. Adjusted EPS decreased 17.7% to $0.65.
For the nine months ended September 30, 2020, EPS was $1.55, a 27.9% decrease compared to the prior year. Adjusted EPS decreased 12.4% to $2.04.
Capital Expenditures decreased 4.9% to $2.4 billion in the third quarter of 2020. Cable Communications’ capital expenditures decreased 2.5% to $1.8 billion. NBCUniversal’s capital expenditures decreased 29.3% to $357 million. Sky’s capital expenditures increased 127.3% to $237 million.
For the nine months ended September 30, 2020, capital expenditures decreased 7.6% to $6.3 billion compared to 2019. Cable Communications’ capital expenditures decreased 5.9% to $4.5 billion. NBCUniversal’s capital expenditures decreased 22.5% to $1.1 billion. Sky’s capital expenditures increased 20.2% to $649 million.
Net Cash Provided by Operating Activities was $5.2 billion in the third quarter of 2020. Free Cash Flow was $2.3 billion.
For the nine months ended September 30, 2020, net cash provided by operating activities was $19.7 billion. Free cash flow was $11.6 billion.
Dividends paid during the third quarter of 2020 totaled $1.1 billion. For the nine months ended September 30, 2020, dividends paid totaled $3.1 billion.
Cable Communications
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||||||
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($ in millions) |
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||||||
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|
3rd Quarter |
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|
Year to Date |
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||||||||||
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|
2020 |
2019 |
Change |
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2020 |
2019 |
Change |
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||||||
|
Cable Communications Revenue |
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|
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|
||||||
|
High-Speed Internet |
$5,198 |
$4,721 |
10.1 |
% |
|
|
$15,199 |
$13,961 |
8.9 |
% |
|
||||
|
Video |
5,421 |
5,541 |
(2.1 |
%) |
|
|
16,468 |
16,763 |
(1.8 |
%) |
|
||||
|
Voice |
876 |
963 |
(9.0 |
%) |
|
|
2,652 |
2,935 |
(9.6 |
%) |
|
||||
|
Wireless |
400 |
326 |
22.8 |
% |
|
|
1,069 |
795 |
34.5 |
% |
|
||||
|
Business Services |
2,049 |
1,971 |
4.0 |
% |
|
|
6,096 |
5,795 |
5.2 |
% |
|
||||
|
Advertising |
674 |
603 |
11.8 |
% |
|
|
1,659 |
1,766 |
(6.1 |
%) |
|
||||
|
Other |
382 |
459 |
(17.2 |
%) |
|
|
1,203 |
1,299 |
(7.5 |
%) |
|
||||
|
Cable Communications Revenue |
$15,000 |
$14,584 |
2.9 |
% |
|
|
$44,346 |
$43,314 |
2.4 |
% |
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||||
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|
||||||
|
Cable Communications Adjusted EBITDA |
$6,411 |
$5,801 |
10.5 |
% |
|
|
$18,663 |
$17,383 |
7.4 |
% |
|
||||
|
Adjusted EBITDA Margin |
42.7% |
39.8% |
|
|
|
42.1% |
40.1% |
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|
||||||
|
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|
|
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|
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|
||||||
|
Cable Communications Capital Expenditures |
$1,770 |
$1,814 |
(2.5 |
%) |
|
|
$4,491 |
$4,771 |
(5.9 |
%) |
|
||||
|
Percent of Cable Communications Revenue |
11.8% |
12.4% |
|
|
|
10.1% |
11.0% |
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|
||||||
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|
Revenue for Cable Communications increased 2.9% to $15.0 billion in the third quarter of 2020, driven by increases in high-speed internet, business services, wireless and advertising revenue, partially offset by decreases in video, voice and other revenue. These results were negatively impacted by accrued customer regional sports network (RSN) fee adjustments related to canceled sporting events as a result of COVID-19. Excluding these adjustments5, Cable Communications revenue increased 3.9%. High-speed internet revenue increased 10.1%, due to an increase in the number of residential high-speed internet customers and an increase in average rates. Excluding the impact of accrued RSN fee adjustments5 for customers taking bundled services, high-speed internet revenue increased 11.2%. Business services revenue increased 4.0%, reflecting increases in average rates and an increase in the number of customers receiving our services. Wireless revenue increased 22.8%, due to an increase in the number of customer lines. Advertising revenue increased 11.8%, primarily reflecting an increase in political advertising revenue. Excluding political advertising revenue, advertising revenue decreased 6.8%. Video revenue decreased 2.1%, due to a decrease in the number of residential video customers, partially offset by an increase in average rates. Excluding the impact of accrued customer RSN fee adjustments5, video revenue decreased 0.8%. Voice revenue decreased 9.0%, reflecting decreases in average rates and in the number of residential voice customers. Other revenue decreased 17.2%, primarily reflecting lower revenue due to waived late fees and a decline in revenue from our security and automation services.
For the nine months ended September 30, 2020, Cable revenue increased 2.4% to $44.3 billion compared to 2019, driven by growth in high-speed internet, business services and wireless revenue, partially offset by a decrease in video, voice, advertising and other revenue. These results were negatively impacted by COVID-19, including accrued customer RSN fee adjustments, reduced advertising revenue and lower revenue due to our efforts to assist customers during this public health crisis. Excluding the impact of accrued customer RSN fee adjustments5, Cable Communications revenue increased 3.2%.
Total Customer Relationships increased by 556,000 to 32.7 million in the third quarter of 2020. Residential customer relationships increased by 539,000 and business customer relationships increased by 17,000. Total high-speed internet customer net additions were 633,000, total video customer net losses were 273,000 and total voice customer net losses were 3,000. In addition, Cable Communications added 187,000 wireless lines in the quarter.
|
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|
|
|
|
|
|||||||||
|
(in thousands) |
|
|
|
|
|
|
|||||||||
|
|
|
|
Net Additions |
|
|||||||||||
|
|
3Q20 |
3Q19 |
|
3Q20 |
|
3Q19 |
|
|
|||||||
|
Customer Relationships |
|
|
|
|
|
|
|||||||||
|
Residential Customer Relationships |
30,289 |
|
28,797 |
|
|
539 |
|
|
288 |
|
|
|
|||
|
Business Services Customer Relationships |
2,401 |
|
2,377 |
|
|
17 |
|
|
21 |
|
|
|
|||
|
Total Customer Relationships |
32,690 |
|
31,173 |
|
|
556 |
|
|
309 |
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||||
|
Residential Customer Relationships Mix |
|
|
|
|
|
|
|||||||||
|
One Product Residential Customers |
11,957 |
|
9,905 |
|
|
625 |
|
|
379 |
|
|
|
|||
|
Two Product Residential Customers |
8,732 |
|
8,915 |
|
|
(9 |
) |
|
(38 |
) |
|
|
|||
|
Three or More Product Residential Customers |
9,600 |
|
9,977 |
|
|
(77 |
) |
|
(53 |
) |
|
|
|||
|
|
|
|
|
|
|
|
|||||||||
|
Residential High-Speed Internet Customers |
27,837 |
|
25,990 |
|
|
617 |
|
|
359 |
|
|
|
|||
|
Business Services High-Speed Internet Customers |
2,225 |
|
2,197 |
|
|
16 |
|
|
20 |
|
|
|
|||
|
Total High-Speed Internet Customers |
30,062 |
|
28,186 |
|
|
633 |
|
|
379 |
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||||
|
Residential Video Customers |
19,220 |
|
20,421 |
|
|
(253 |
) |
|
(222 |
) |
|
|
|||
|
Business Services Video Customers |
874 |
|
983 |
|
|
(20 |
) |
|
(16 |
) |
|
|
|||
|
Total Video Customers |
20,094 |
|
21,403 |
|
|
(273 |
) |
|
(238 |
) |
|
|
|||
|
|
|
|
|
|
|
|
|||||||||
|
Residential Voice Customers |
9,684 |
|
9,945 |
|
|
(14 |
) |
|
(63 |
) |
|
|
|||
|
Business Services Voice Customers |
1,341 |
|
1,334 |
|
|
11 |
|
|
10 |
|
|
|
|||
|
Total Voice Customers |
11,025 |
|
11,278 |
|
|
(3 |
) |
|
(53 |
) |
|
|
|||
|
|
|
|
|
|
|
|
|||||||||
|
Total Wireless Lines |
2,580 |
|
1,791 |
|
|
187 |
|
|
204 |
|
|
|
|||
|
|
|
|
|
|
|
|
Adjusted EBITDA for Cable Communications increased 10.5% to $6.4 billion in the third quarter of 2020, due to higher revenue as well as a 2.2% decrease in operating expenses. Total operating expenses benefited from adjustments for provisions in our programming distribution agreements with RSNs related to canceled sporting events as a result of COVID-19. Programming costs decreased 0.6%, primarily reflecting the adjustment provisions. Excluding these adjustments5, programming costs increased 4.0% due to higher retransmission consent and sports programming fees, partially offset by a decline in the number of video subscribers. Non-programming expenses decreased 3.2%, while non-programming expenses per customer relationship decreased 7.4%. These declines reflect lower advertising, marketing and promotion expenses, technical and product support expenses and customer service expenses, partially offset by higher other operating expenses and franchise and regulatory fees. Non-programming expenses reflect a reduction in activity in some aspects of our business as a result of COVID-19 as well as benefits from cost saving initiatives. Adjusted EBITDA per customer relationship increased 5.8%, and Adjusted EBITDA margin was 42.7% compared to 39.8% in the third quarter of 2019. While the accrued RSN adjustments did not impact Adjusted EBITDA in the third quarter of 2020, the adjustments resulted in an increase to Adjusted EBITDA margin. Cable Communications results include a loss of $50 million from our wireless business, compared to a loss of $94 million in the prior year period.
For the nine months ended September 30, 2020, Cable Adjusted EBITDA increased 7.4% to $18.7 billion compared to 2019, due to higher revenue and a decrease in operating expenses. Programming costs decreased 1.3% primarily reflecting adjustments for provisions in our programming distribution agreements with RSNs related to canceled sporting events as a result of COVID-19. Excluding these adjustments5, programming costs increased 2.4% due to higher retransmission consent and sports programming fees, partially offset by a decline in the number of video subscribers. Non-programming expenses decreased 0.8%, reflecting cost savings initiatives that were partially offset by higher costs as a result of COVID-19. For the nine months ended September 30, 2020, Adjusted EBITDA per customer relationship increased 2.9%, and Adjusted EBITDA margin was 42.1% compared to 40.1% in 2019. While the accrued RSN adjustments did not impact Adjusted EBITDA for the nine months ended September 30, 2020, the adjustments resulted in an increase to Adjusted EBITDA margin. Cable Communications results include a loss of $146 million from our wireless business, compared to a loss of $285 million in the prior year period.
Capital Expenditures for Cable Communications decreased 2.5% to $1.8 billion in the third quarter of 2020, due to decreased investment in customer premise equipment and support capital, partially offset by increased investment in scalable infrastructure and line extensions. Cable capital expenditures represented 11.8% of Cable revenue in the third quarter of 2020 compared to 12.4% in last year’s third quarter.
For the nine months ended September 30, 2020, Cable capital expenditures decreased 5.9% to $4.5 billion, primarily reflecting decreased investment in customer premise equipment, partially offset by increased investment in scalable infrastructure. Cable capital expenditures represented 10.1% of Cable revenue compared to 11.0% in 2019.
NBCUniversal
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
($ in millions) |
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
3rd Quarter |
|
|
Year to Date |
|
||||||||||||||||||
|
|
2020 |
2019 |
Change |
|
|
2020 |
2019 |
Change |
|
||||||||||||||
|
NBCUniversal Revenue |
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Cable Networks |
$2,736 |
|
|
$2,771 |
|
|
(1.3 |
%) |
|
|
$8,110 |
|
|
$8,586 |
|
|
(5.5 |
%) |
|
||||
|
Broadcast Television |
2,414 |
|
|
2,230 |
|
|
8.3 |
% |
|
|
7,462 |
|
|
7,099 |
|
|
5.1 |
% |
|
||||
|
Filmed Entertainment |
1,280 |
|
|
1,706 |
|
|
(25.0 |
%) |
|
|
3,844 |
|
|
4,931 |
|
|
(22.0 |
%) |
|
||||
|
Theme Parks |
311 |
|
|
1,631 |
|
|
(80.9 |
%) |
|
|
1,267 |
|
|
4,371 |
|
|
(71.0 |
%) |
|
||||
|
Headquarters, other and eliminations |
(17 |
) |
|
(43 |
) |
|
NM |
|
|
(101 |
) |
|
(173 |
) |
|
NM |
|
||||||
|
NBCUniversal Revenue |
$6,724 |
|
|
$8,295 |
|
|
(18.9 |
%) |
|
|
$20,582 |
|
|
$24,814 |
|
|
(17.1 |
%) |
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
NBCUniversal Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Cable Networks |
$870 |
|
|
$955 |
|
|
(8.9 |
%) |
|
|
$3,361 |
|
|
$3,418 |
|
|
(1.7 |
%) |
|
||||
|
Broadcast Television |
436 |
|
|
338 |
|
|
28.7 |
% |
|
|
1,578 |
|
|
1,259 |
|
|
25.3 |
% |
|
||||
|
Filmed Entertainment |
300 |
|
|
195 |
|
|
53.4 |
% |
|
|
634 |
|
|
742 |
|
|
(14.6 |
%) |
|
||||
|
Theme Parks |
(203 |
) |
|
731 |
|
|
(127.7 |
%) |
|
|
(526 |
) |
|
1,819 |
|
|
(128.9 |
%) |
|
||||
|
Headquarters, other and eliminations |
(122 |
) |
|
(128 |
) |
|
NM |
|
|
(381 |
) |
|
(486 |
) |
|
NM |
|
||||||
|
NBCUniversal Adjusted EBITDA |
$1,281 |
|
|
$2,091 |
|
|
(38.7 |
%) |
|
|
$4,666 |
|
|
$6,752 |
|
|
(30.9 |
%) |
|
||||
|
|
|
|
|
|
|
|
|
|
|
Revenue for NBCUniversal decreased 18.9% to $6.7 billion in the third quarter of 2020. Adjusted EBITDA decreased 38.7% to $1.3 billion.
For the nine months ended September 30, 2020, NBCUniversal revenue decreased 17.1% to $20.6 billion compared to last year’s results. Adjusted EBITDA decreased 30.9% to $4.7 billion.
Cable Networks
Cable Networks revenue decreased 1.3% to $2.7 billion in the third quarter of 2020, due to lower distribution revenue and advertising revenue, partially offset by higher content licensing and other revenue. Distribution revenue decreased 3.8%, reflecting credits accrued at some of our RSNs resulting from the reduced number of games played by professional sports leagues due to COVID-19 and a decline in subscribers, partially offset by contractual rate increases. Advertising revenue decreased 2.1%, reflecting continued ratings declines at our networks, partially offset by revenue from the broadcasts of rescheduled sporting events that were previously postponed due to COVID-19. Content licensing and other revenue increased 16.6%, due to the timing of content provided under licensing agreements, including transactions with Peacock in the third quarter of 2020. Adjusted EBITDA decreased 8.9% to $870 million in the third quarter of 2020, due to lower revenue and higher programming and production expenses, partially offset by lower advertising, marketing and promotion costs and other operating and administrative costs. The increase in programming and production expenses was primarily driven by an increase in sports programming costs as professional sports leagues resumed seasons following postponements due to COVID-19.
For the nine months ended September 30, 2020, revenue from the Cable Networks segment decreased 5.5% to $8.1 billion compared to 2019, due to lower distribution and advertising revenue, partially offset by higher content licensing and other revenue. Adjusted EBITDA decreased 1.7% to $3.4 billion compared to 2019, due to lower revenue, partially offset by lower operating costs. The decrease in operating costs was driven by lower programming and production expenses, reflecting a decrease in sports programming costs due to the reduced number of sporting events due to COVID-19, partially offset by an increase in studio costs.
Broadcast Television
Broadcast Television revenue increased 8.3% to $2.4 billion in the third quarter of 2020, due to higher content licensing revenue and distribution and other revenue, partially offset by lower advertising revenue. Content licensing revenue increased 65.6%, reflecting the timing of content provided under licensing agreements, including transactions with Peacock in the third quarter of 2020. Distribution and other revenue increased 4.9%, due to higher retransmission consent fees. Advertising revenue decreased 11.5%, reflecting continued ratings declines, partially offset by higher pricing and local political ad sales. Adjusted EBITDA increased 28.7% to $436 million in the third quarter of 2020, due to higher revenue, lower advertising, marketing and promotion costs and lower operating and administrative costs, partially offset by higher programming and production expenses. The increase in programming and production expenses was primarily due to higher content licensing sales.
For the nine months ended September 30, 2020, revenue from the Broadcast Television segment increased 5.1% to $7.5 billion compared to 2019, due to an increase in content licensing and distribution and other revenue, partially offset by lower advertising revenue. Adjusted EBITDA increased 25.3% to $1.6 billion compared to 2019, due to higher revenue, partially offset by a modest increase in operating costs.
Filmed Entertainment
Filmed Entertainment revenue decreased 25.0% to $1.3 billion in the third quarter of 2020, due to lower theatrical and other revenue, partially offset by higher content licensing and home entertainment revenue. Theatrical revenue decreased 94.7%, primarily driven by theater closures as a result of COVID-19. Other revenue decreased 44.8%, primarily due to decreases in revenue from our movie ticketing, entertainment and live stage play businesses, which were impacted by theater and entertainment venue closures as a result of COVID-19. Content licensing revenue increased 14.5%, due to the timing of content provided under licensing agreements, including transactions with Peacock in the third quarter of 2020. Home entertainment revenue increased 49.1%, which included the success of Trolls World Tour. Adjusted EBITDA increased 53.4% to $300 million in the third quarter of 2020, reflecting lower revenue, more than offset by a decline in operating costs due to lower spending on current period releases as a result of COVID-19.
For the nine months ended September 30, 2020, revenue from the Filmed Entertainment segment decreased 22.0% to $3.8 billion compared to 2019, primarily reflecting lower theatrical revenue. Adjusted EBITDA decreased 14.6% to $634 million compared to 2019, due to lower revenue, partially offset by lower operating costs.
Theme Parks
Theme Parks revenue decreased 80.9% to $311 million in the third quarter of 2020, primarily due to Universal Orlando Resort and Universal Studios Japan operating at limited capacity, while Universal Studios Hollywood remains closed as a result of COVID-19. Theme Parks Adjusted EBITDA loss was $203 million in the third quarter of 2020.
For the nine months ended September 30, 2020, revenue from the Theme Parks segment decreased 71.0% to $1.3 billion compared to 2019, primarily due to the temporary closures of Universal Studios Japan in late February and Universal Orlando Resort and Universal Studios Hollywood in mid-March as a result of COVID-19. Theme Parks Adjusted EBITDA loss was $526 million.
Headquarters, Other and Eliminations
NBCUniversal Headquarters, Other and Eliminations include overhead and eliminations among the NBCUniversal businesses. For the quarter ended September 30, 2020, NBCUniversal Headquarters, Other and Eliminations Adjusted EBITDA loss was $122 million, compared to a loss of $128 million in the third quarter of 2019.
For the nine months ended September 30, 2020, NBCUniversal Headquarters, Other and Eliminations Adjusted EBITDA loss was $381 million compared to a loss of $486 million in 2019.
Sky
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
($ in millions) |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
3rd Quarter |
|
|
Year to Date |
|
||||||||||||||||
|
|
2020 |
2019 |
Change |
Constant |
|
|
2020 |
2019 |
Change |
Constant |
|
||||||||||
|
Sky Revenue |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Direct-to-Consumer |
$3,943 |
$3,793 |
3.9 |
% |
(1.0 |
%) |
|
|
$11,146 |
$11,516 |
(3.2 |
%) |
(3.1 |
%) |
|
||||||
|
Content |
388 |
315 |
23.3 |
% |
17.5 |
% |
|
|
947 |
1,061 |
(10.7 |
%) |
(10.4 |
%) |
|
||||||
|
Advertising |
462 |
446 |
3.7 |
% |
(1.2 |
%) |
|
|
1,296 |
1,602 |
(19.1 |
%) |
(18.7 |
%) |
|
||||||
|
Sky Revenue |
$4,793 |
$4,554 |
5.2 |
% |
0.3 |
% |
|
|
$13,389 |
$14,179 |
(5.6 |
%) |
(5.4 |
%) |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Sky Operating Costs and Expenses |
$4,278 |
$3,655 |
17.0 |
% |
11.5 |
% |
|
|
$11,574 |
$11,845 |
(2.3 |
%) |
(2.0 |
%) |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Sky Adjusted EBITDA |
$515 |
$899 |
(42.8 |
%) |
(45.4 |
%) |
|
|
$1,815 |
$2,334 |
(22.3 |
%) |
(22.5 |
%) |
|
||||||
|
Adjusted EBITDA Margin |
10.7% |
19.7% |
|
|
|
|
13.6% |
16.5% |
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue for Sky increased 5.2% to $4.8 billion in the third quarter of 2020. Excluding the impact of currency, revenue was consistent with the prior year period, due to higher content revenue, offset by lower direct-to-consumer revenue and advertising revenue. Content revenue increased 17.5% to $388 million, driven by higher wholesale revenue from sports programming as European football leagues resumed sporting events that were previously postponed due to COVID-19. Direct-to-consumer revenue decreased 1.0% to $3.9 billion, reflecting a decrease in customer relationships and average revenue per customer relationship that was consistent with the prior year period, and included growth in both customer relationships and average revenue per customer relationship in the U.K. Advertising revenue decreased 1.2% to $462 million, reflecting overall market weakness, partially offset by revenue from the broadcasts of rescheduled sporting events that were previously postponed due to COVID-19.
For the nine months ended September 30, 2020, Sky revenue decreased 5.6% to $13.4 billion compared to 2019. Excluding the impact of currency, revenue decreased 5.4%, due to lower direct-to-consumer, advertising and content revenue.
Total Customer Relationships decreased by 21,000 to 23.7 million in the third quarter of 2020, an improvement compared to the second quarter of 2020, and included net additions in the U.K.
|
|
|
|
|
|
|
|
|||||||||||||||
|
(in thousands) |
|
|
|
|
|
|
|||||||||||||||
|
|
Customers |
|
Net Additions |
|
|||||||||||||||||
|
|
3Q20 |
3Q19 |
|
3Q20 |
3Q19 |
|
|||||||||||||||
|
Total Customer Relationships |
23,695 |
23,918 |
|
(21) |
(99) |
|
|||||||||||||||
|
|
|
|
|
|
|
|
Adjusted EBITDA for Sky decreased 42.8% to $515 million in the third quarter of 2020. Excluding the impact of currency, Adjusted EBITDA decreased 45.4%, reflecting revenue that was consistent with the prior year period, offset by higher operating costs. The increase in operating costs was primarily driven by higher programming and production expenses, primarily due to an increase in sports programming costs as professional sports leagues resumed seasons following postponements due to COVID-19.
For the nine months ended September 30, 2020, Sky Adjusted EBITDA decreased 22.3% to $1.8 billion compared to 2019. Excluding the impact of currency, Adjusted EBITDA decreased 22.5%.
Corporate, Other and Eliminations
__________________________________________________________________________________________________________________________________________
Corporate and Other
Corporate and Other primarily relates to corporate operations, Comcast Spectacor and Peacock. Revenue for the quarter ended September 30, 2020 was $84 million, an increase of $42 million compared to 2019. Corporate and Other Adjusted EBITDA loss was $496 million, an increase of $259 million compared to 2019, primarily due to costs associated with Peacock.
For the nine months ended September 30, 2020, Corporate and Other revenue was $250 million, an increase of $44 million compared to 2019. Corporate and Other Adjusted EBITDA loss was $1.3 billion, an increase of $617 million compared to 2019, due to costs associated with Peacock and costs incurred in response to COVID-19, including severance and restructuring charges related to our NBCUniversal segments, which are presented in Corporate and Other.
Eliminations
Eliminations reflects the accounting for transactions between Cable Communications, NBCUniversal, Sky and Corporate and Other. Revenue eliminations for the quarter ended September 30, 2020 were $1.1 billion compared to $648 million in 2019, and Adjusted EBITDA eliminations were $128 million compared to $1 million in 2019. The increases were primarily driven by the licensing of content between our NBCUniversal segments and Peacock.
For the nine months ended September 30, 2020, revenue eliminations were $2.7 billion compared to $2.0 billion in 2019, and Adjusted EBITDA eliminations were $250 million compared to $10 million in 2019. The increases were primarily driven by the licensing of content between our NBCUniversal segments and Peacock.
__________________________________________________________________________________________________________________________________________
Notes:
1. |
We define Adjusted Net Income and Adjusted EPS as net income attributable to Comcast Corporation and diluted earnings per common share attributable to Comcast Corporation shareholders, respectively, adjusted to exclude the effects of the amortization of acquisition-related intangible assets, investments that investors may want to evaluate separately (such as based on fair value) and the impact of certain events, gains, losses or other charges that affect period-over-period comparisons. See Table 5 for reconciliations of non-GAAP financial measures. |
||
2. |
We define Adjusted EBITDA as net income attributable to Comcast Corporation before net income (loss) attributable to noncontrolling interests and redeemable subsidiary preferred stock, income tax expense, investment and other income (loss), net, interest expense, depreciation and amortization expense, and other operating gains and losses (such as impairment charges related to fixed and intangible assets and gains or losses on the sale of long-lived assets), if any. From time to time, we may exclude from Adjusted EBITDA the impact of certain events, gains, losses or other charges (such as significant legal settlements) that affect the period-to-period comparability of our operating performance. See Table 4 for reconciliation of non-GAAP financial measure. | ||
3. |
All earnings per share amounts are presented on a diluted basis. |
||
4. |
We define Free Cash Flow as net cash provided by operating activities (as stated in our Consolidated Statement of Cash Flows) reduced by capital expenditures and cash paid for intangible assets. From time to time, we may exclude from Free Cash Flow the impact of certain cash receipts or payments (such as significant legal settlements) that affect period-to-period comparability. Cash payments for acquisitions and construction of real estate properties and the construction of Universal Beijing Resort are presented separately in our Consolidated Statement of Cash Flows and are therefore excluded from capital expenditures for Free Cash Flow. See Table 4 for reconciliation of non-GAAP financial measure. |
||
5. |
Cable Communications reported results for 2020 include the impacts of RSN related adjustments, affecting period-to-period comparability of our operating performance. We also present adjusted information, excluding the impacts of the RSN related adjustments. See Table 7 for reconciliation of non-GAAP financial measures. |
||
6. |
Sky constant currency growth rates are calculated by comparing the current period results to the comparative period results in the prior year adjusted to reflect the average exchange rates from the current year period rather than the actual exchange rates in effect during the respective prior year periods. See Table 6 for reconciliation of Sky’s constant currency growth. |
||
All percentages are calculated on whole numbers. Minor differences may exist due to rounding. |
Conference Call and Other Information
Comcast Corporation will host a conference call with the financial community today, October 29, 2020 at 8:30 a.m. Eastern Time (ET). The conference call and related materials will be broadcast live and posted on its Investor Relations website at www.cmcsa.com. Those parties interested in participating via telephone should dial (800) 263-8495 with the conference ID number 3090648. A replay of the call will be available starting at 12:00 p.m. ET on October 29, 2020, on the Investor Relations website or by telephone. To access the telephone replay, which will be available until Thursday, November 5, 2020 at midnight ET, please dial (855) 859-2056 and enter the conference ID number 3090648.
From time to time, we post information that may be of interest to investors on our website at www.cmcsa.com and on our corporate website, www.comcastcorporation.com. To automatically receive Comcast financial news by email, please visit www.cmcsa.com and subscribe to email alerts.
Caution Concerning Forward-Looking Statements
This press release contains forward-looking statements. Readers are cautioned that such forward-looking statements involve risks and uncertainties that could cause actual events or our actual results to differ materially from those expressed in any such forward-looking statements. Readers are directed to Comcast’s periodic and other reports filed with the Securities and Exchange Commission (SEC) for a description of such risks and uncertainties. We undertake no obligation to update any forward-looking statements.
Non-GAAP Financial Measures
In this discussion, we sometimes refer to financial measures that are not presented according to generally accepted accounting principles in the U.S. (GAAP). Certain of these measures are considered “non-GAAP financial measures” under the SEC regulations; those rules require the supplemental explanations and reconciliations that are in Comcast’s Form 8-K (Quarterly Earnings Release) furnished to the SEC.
About Comcast Corporation
Comcast Corporation (Nasdaq: CMCSA) is a global media and technology company with three primary businesses: Comcast Cable, NBCUniversal, and Sky. Comcast Cable is one of the United States’ largest high-speed internet, video, and phone providers to residential customers under the Xfinity brand, and also provides these services to businesses. It also provides wireless and security and automation services to residential customers under the Xfinity brand. NBCUniversal is global and operates news, entertainment and sports cable networks, the NBC and Telemundo broadcast networks, television production operations, television station groups, Universal Pictures, and Universal Parks and Resorts. Sky is one of Europe’s leading media and entertainment companies, connecting customers to a broad range of video content through its pay television services. It also provides communications services, including residential high-speed internet, phone, and wireless services. Sky operates the Sky News broadcast network and sports and entertainment networks, produces original content, and has exclusive content rights. Visit www.comcastcorporation.com for more information.
TABLE 1 | ||||||||||||||||
Condensed Consolidated Statement of Income (Unaudited) |
|
|
|
|
|
|
|
|||||||||
|
Three Months Ended |
|
Nine Months Ended |
|||||||||||||
(in millions, except per share data) |
September 30, |
|
September 30, |
|||||||||||||
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|||||||||
Revenue |
$25,532 |
|
|
|
$26,827 |
|
|
|
$75,856 |
|
|
|
$ |
80,544 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Costs and expenses |
|
|
|
|
|
|
|
|||||||||
Programming and production |
8,565 |
|
|
|
8,316 |
|
|
|
23,683 |
|
|
|
|
25,140 |
|
|
Other operating and administrative |
8,059 |
|
|
|
8,090 |
|
|
|
23,959 |
|
|
|
|
24,076 |
|
|
Advertising, marketing and promotion |
1,512 |
|
|
|
1,901 |
|
|
|
4,791 |
|
|
|
|
5,674 |
|
|
Depreciation |
2,122 |
|
|
|
2,124 |
|
|
|
6,328 |
|
|
|
|
6,561 |
|
|
Amortization |
1,198 |
|
|
|
1,056 |
|
|
|
3,520 |
|
|
|
|
3,215 |
|
|
|
21,456 |
|
|
|
21,487 |
|
|
|
62,281 |
|
|
|
|
64,666 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating income |
4,076 |
|
|
|
5,340 |
|
|
|
13,575 |
|
|
|
|
15,878 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Interest expense |
(1,220 |
) |
|
|
(1,167 |
) |
|
|
(3,544 |
) |
|
|
|
(3,454 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Investment and other income (loss), net |
|
|
|
|
|
|
|
|||||||||
Equity in net income (losses) of investees, net |
(266 |
) |
|
|
(355 |
) |
|
|
(634 |
) |
|
|
|
(295 |
) |
|
Realized and unrealized gains (losses) on equity securities, net |
118 |
|
|
|
174 |
|
|
|
65 |
|
|
|
|
582 |
|
|
Other income (loss), net |
62 |
|
|
|
71 |
|
|
|
187 |
|
|
|
|
224 |
|
|
|
(86 |
) |
|
|
(110 |
) |
|
|
(382 |
) |
|
|
|
511 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Income before income taxes |
2,770 |
|
|
|
4,063 |
|
|
|
9,649 |
|
|
|
|
12,935 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Income tax expense |
(739 |
) |
|
|
(775 |
) |
|
|
(2,385 |
) |
|
|
|
(2,812 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Net income |
2,031 |
|
|
|
3,288 |
|
|
|
7,264 |
|
|
|
|
10,123 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Less: Net income (loss) attributable to noncontrolling interests and redeemable subsidiary preferred stock |
12 |
|
|
|
71 |
|
|
|
110 |
|
|
|
|
228 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Net income attributable to Comcast Corporation |
$2,019 |
|
|
|
$3,217 |
|
|
|
$7,154 |
|
|
|
$ |
9,895 |
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|||||||||
Diluted earnings per common share attributable to Comcast Corporation shareholders |
$0.44 |
|
|
|
$0.70 |
|
|
|
$1.55 |
|
|
|
$ |
2.15 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Diluted weighted-average number of common shares |
4,628 |
|
|
|
4,619 |
|
|
|
4,616 |
|
|
|
|
4,606 |
|
|
|
|
|
|
|
|
|
|
TABLE 2 |
|||||||
Consolidated Statement of Cash Flows (Unaudited) |
|||||||
|
|
|
|
||||
|
Nine Months Ended |
||||||
(in millions) |
September 30, |
||||||
|
2020 |
|
2019 |
||||
|
|
|
|
||||
OPERATING ACTIVITIES |
|
|
|
||||
Net income |
$7,264 |
|
|
|
$10,123 |
|
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
9,848 |
|
|
|
9,776 |
|
|
Share-based compensation |
922 |
|
|
|
790 |
|
|
Noncash interest expense (income), net |
606 |
|
|
|
310 |
|
|
Net (gain) loss on investment activity and other |
514 |
|
|
|
(166 |
) |
|
Deferred income taxes |
(224 |
) |
|
|
468 |
|
|
Changes in operating assets and liabilities, net of effects of acquisitions and divestitures: |
|
|
|
||||
Current and noncurrent receivables, net |
982 |
|
|
|
360 |
|
|
Film and television costs, net |
163 |
|
|
|
(321 |
) |
|
Accounts payable and accrued expenses related to trade creditors |
(545 |
) |
|
|
(1,149 |
) |
|
Other operating assets and liabilities |
165 |
|
|
|
(729 |
) |
|
|
|
|
|
||||
Net cash provided by operating activities |
19,695 |
|
|
|
19,462 |
|
|
|
|
|
|
||||
INVESTING ACTIVITIES |
|
|
|
||||
Capital expenditures |
(6,344 |
) |
|
|
(6,866 |
) |
|
Cash paid for intangible assets |
(1,771 |
) |
|
|
(1,686 |
) |
|
Construction of Universal Beijing Resort |
(1,118 |
) |
|
|
(736 |
) |
|
Acquisitions, net of cash acquired |
(225 |
) |
|
|
(181 |
) |
|
Proceeds from sales of businesses and investments |
2,131 |
|
|
|
208 |
|
|
Purchases of investments |
(545 |
) |
|
|
(1,697 |
) |
|
Other |
(101 |
) |
|
|
46 |
|
|
|
|
|
|
||||
Net cash provided by (used in) investing activities |
(7,973 |
) |
|
|
(10,912 |
) |
|
|
|
|
|
||||
FINANCING ACTIVITIES |
|
|
|
||||
Proceeds from (repayments of) short-term borrowings, net |
— |
|
|
|
(1,288 |
) |
|
Proceeds from borrowings |
18,339 |
|
|
|
516 |
|
|
Proceeds from collateralized obligation |
— |
|
|
|
5,175 |
|
|
Repurchases and repayments of debt |
(16,771 |
) |
|
|
(9,975 |
) |
|
Repurchases of common stock under employee plans |
(429 |
) |
|
|
(432 |
) |
|
Dividends paid |
(3,086 |
) |
|
|
(2,778 |
) |
|
Other |
(1,644 |
) |
|
|
(44 |
) |
|
|
|
|
|
||||
Net cash provided by (used in) financing activities |
(3,591 |
) |
|
|
(8,826 |
) |
|
|
|
|
|
||||
Impact of foreign currency on cash, cash equivalents and restricted cash |
17 |
|
|
|
(31 |
) |
|
|
|
|
|
||||
Increase (decrease) in cash, cash equivalents and restricted cash |
8,148 |
|
|
|
(307 |
) |
|
|
|
|
|
||||
Cash, cash equivalents and restricted cash, beginning of period |
5,589 |
|
|
|
3,909 |
|
|
|
|
|
|
||||
Cash, cash equivalents and restricted cash, end of period |
$13,737 |
|
|
|
$3,602 |
|
|
|
|
|
|
TABLE 3 |
|||||
Condensed Consolidated Balance Sheet (Unaudited) |
|||||
|
|
|
|
||
(in millions) |
September 30, |
|
December 31, |
||
|
2020 |
|
2019 |
||
ASSETS |
|
|
|
||
|
|
|
|
||
Current Assets |
|
|
|
||
Cash and cash equivalents |
$13,707 |
|
|
$5,500 |
|
Receivables, net |
10,310 |
|
|
11,292 |
|
Programming rights |
— |
|
|
3,877 |
|
Other current assets |
3,352 |
|
|
4,723 |
|
Total current assets |
27,369 |
|
|
25,392 |
|
|
|
|
|
||
Film and television costs |
12,741 |
|
|
8,933 |
|
|
|
|
|
||
Investments |
6,702 |
|
|
6,989 |
|
|
|
|
|
||
Investment securing collateralized obligation |
429 |
|
|
694 |
|
|
|
|
|
||
Property and equipment, net |
50,466 |
|
|
48,322 |
|
|
|
|
|
||
Goodwill |
68,898 |
|
|
68,725 |
|
|
|
|
|
||
Franchise rights |
59,365 |
|
|
59,365 |
|
|
|
|
|
||
Other intangible assets, net |
34,485 |
|
|
36,128 |
|
|
|
|
|
||
Other noncurrent assets, net |
8,485 |
|
|
8,866 |
|
|
|
|
|
||
|
$268,940 |
|
|
$263,414 |
|
|
|
|
|
||
LIABILITIES AND EQUITY |
|
|
|
||
|
|
|
|
||
Current Liabilities |
|
|
|
||
Accounts payable and accrued expenses related to trade creditors |
$10,979 |
|
|
$10,826 |
|
Accrued participations and residuals |
1,794 |
|
|
1,730 |
|
Deferred revenue |
2,888 |
|
|
2,768 |
|
Accrued expenses and other current liabilities |
9,421 |
|
|
10,516 |
|
Current portion of long-term debt |
4,429 |
|
|
4,452 |
|
Total current liabilities |
29,511 |
|
|
30,292 |
|
|
|
|
|
||
Long-term debt, less current portion |
99,995 |
|
|
97,765 |
|
|
|
|
|
||
Collateralized obligation |
5,167 |
|
|
5,166 |
|
|
|
|
|
||
Deferred income taxes |
27,905 |
|
|
28,180 |
|
|
|
|
|
||
Other noncurrent liabilities |
17,537 |
|
|
16,765 |
|
|
|
|
|
||
Redeemable noncontrolling interests and redeemable subsidiary preferred stock |
1,254 |
|
|
1,372 |
|
|
|
|
|
||
Equity |
|
|
|
||
Comcast Corporation shareholders’ equity |
86,176 |
|
|
82,726 |
|
Noncontrolling interests |
1,395 |
|
|
1,148 |
|
Total equity |
87,571 |
|
|
83,874 |
|
|
|
|
|
||
|
$268,940 |
|
|
$263,414 |
|
TABLE 4 | |||||||||||||||
Reconciliation from Net Income Attributable to Comcast Corporation to Adjusted EBITDA (Unaudited) | |||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||
(in millions) |
2020 |
2019 |
|
|
2020 |
|
2019 |
||||||||
Net income attributable to Comcast Corporation |
$2,019 |
|
$3,217 |
|
|
|
$7,154 |
|
|
$9,895 |
|
||||
Net income (loss) attributable to noncontrolling interests and redeemable subsidiary preferred stock |
12 |
|
71 |
|
|
|
110 |
|
|
228 |
|
||||
Income tax expense |
739 |
|
775 |
|
|
|
2,385 |
|
|
2,812 |
|
||||
Interest expense |
1,220 |
|
1,167 |
|
|
|
3,544 |
|
|
3,454 |
|
||||
Investment and other (income) loss, net |
86 |
|
110 |
|
|
|
382 |
|
|
(511 |
) |
||||
Depreciation and amortization |
3,320 |
|
3,180 |
|
|
|
9,848 |
|
|
9,776 |
|
||||
Adjustments (1) |
187 |
|
33 |
|
|
|
217 |
|
|
168 |
|
||||
Adjusted EBITDA |
$7,583 |
|
$8,553 |
|
|
|
$23,640 |
|
|
$25,822 |
|
||||
|
|
|
|
|
|||||||||||
Reconciliation from Net Cash Provided by Operating Activities to Free Cash Flow (Unaudited) |
|
||||||||||||||
|
|
Three Months Ended |
Nine Months Ended |
||||||||||||
(in millions) |
2020 |
2019 |
2020 |
2019 |
|||||||||||
Net cash provided by operating activities |
$5,228 |
|
$5,191 |
|
$19,695 |
|
$19,462 |
|
|||||||
Capital expenditures |
(2,387 |
) |
(2,511 |
) |
(6,344 |
) |
(6,866 |
) |
|||||||
Cash paid for capitalized software and other intangible assets |
(552 |
) |
(608 |
) |
(1,771 |
) |
(1,686 |
) |
|||||||
Total Free Cash Flow |
$2,289 |
|
$2,072 |
|
$11,580 |
|
$10,910 |
|
|||||||
|
|
|
|
|
|
||||||||||
Alternate Presentation of Free Cash Flow (Unaudited) |
|||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||
(in millions) |
2020 |
2019 |
2020 |
2019 |
|||||||||||
Adjusted EBITDA |
$7,583 |
|
$8,553 |
|
$23,640 |
|
$25,822 |
|
|||||||
Capital expenditures |
(2,387 |
) |
(2,511 |
) |
(6,344 |
) |
(6,866 |
) |
|||||||
Cash paid for capitalized software and other intangible assets |
(552 |
) |
(608 |
) |
(1,771 |
) |
(1,686 |
) |
|||||||
Cash interest expense |
(909 |
) |
(1,056 |
) |
(2,845 |
) |
(3,167 |
) |
|||||||
Cash taxes |
(1,965 |
) |
(856 |
) |
(2,298 |
) |
(2,490 |
) |
|||||||
Changes in operating assets and liabilities |
376 |
|
(1,765 |
) |
361 |
|
(1,670 |
) |
|||||||
Noncash share-based compensation |
301 |
|
257 |
|
922 |
|
790 |
|
|||||||
Other (2) |
(158 |
) |
58 |
|
(85 |
) |
177 |
|
|||||||
Total Free Cash Flow |
$2,289 |
|
$2,072 |
|
$11,580 |
|
$10,910 |
|
(1) |
3rd quarter and year to date 2020 Adjusted EBITDA exclude $177 million of other operating and administrative expense related to a potential legal settlement, and $10 million and $40 million of other operating and administrative expense, respectively, related to the Sky transaction. 3rd quarter and year to date 2019 Adjusted EBITDA exclude $33 million and $168 million of other operating and administrative expense, respectively, related to the Sky transaction. |
||
|
|
|
|
(2) |
3rd quarter and year to date 2020 include decreases of $177 million related to a potential legal settlement, and $10 million and $40 million of costs related to the Sky transaction, respectively, as these amounts are excluded from Adjusted EBITDA. 3rd quarter and year to date 2019 include decreases of $33 million and $168 million of costs related to the Sky transaction, respectively, as these amounts are excluded from Adjusted EBITDA. |
||
|
|
||
Note: Minor differences may exist due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
TABLE 5 |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Reconciliations of Adjusted Net Income and Adjusted EPS (Unaudited) |
|
|||||||||||||||||||||
|
|
|
|
|
||||||||||||||||||
|
Three Months Ended |
|
|
Nine Months Ended |
||||||||||||||||||
|
|
|
||||||||||||||||||||
|
2020 |
|
2019 |
|
|
2020 |
|
2019 |
||||||||||||||
(in millions, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
$ |
|
EPS |
|
$ |
|
EPS |
|
|
$ |
|
EPS |
|
$ |
|
EPS |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net income attributable to Comcast Corporation and diluted earnings per share attributable to Comcast Corporation shareholders |
$2,019 |
|
$0.44 |
|
$3,217 |
|
$0.70 |
|
|
$7,154 |
|
$1.55 |
|
$9,895 |
|
$2.15 |
||||||
Change |
(37.2 |
%) |
|
(37.1 |
%) |
|
|
|
|
|
|
(27.7 |
%) |
|
(27.9 |
%) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Amortization of acquisition-related intangible assets (1) |
458 |
|
0.10 |
|
385 |
|
0.08 |
|
|
1,365 |
|
0.30 |
|
1,180 |
|
0.25 |
|
|||||
Investments (2) |
70 |
|
0.01 |
|
141 |
|
0.03 |
|
|
|
334 |
|
0.07 |
|
(317) |
|
(0.07) |
|
||||
Items affecting period-over-period comparability: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Loss on early redemption of debt (3) |
166 |
|
0.04 |
|
42 |
|
0.01 |
|
|
|
272 |
|
0.06 |
|
42 |
|
0.01 |
|
||||
Income tax adjustments (4) |
145 |
|
0.03 |
|
(125) |
|
(0.03) |
|
|
|
145 |
|
0.03 |
|
(125) |
|
(0.03) |
|
||||
Potential legal settlement (5) |
134 |
|
0.03 |
|
— |
|
— |
|
|
|
134 |
|
0.03 |
|
— |
|
— |
|
||||
Costs related to Sky transaction (6) |
8 |
|
— |
|
27 |
|
— |
|
|
|
32 |
|
— |
|
136 |
|
0.03 |
|
||||
Gains and losses related to businesses and investments (7) |
— |
|
— |
|
(20) |
|
— |
|
|
|
— |
|
— |
|
(96) |
|
(0.02) |
|
||||
Purchase accounting adjustments (8) |
— |
|
— |
|
— |
|
— |
|
|
|
— |
|
— |
|
39 |
|
0.01 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Adjusted Net income and Adjusted EPS |
$3,000 |
|
$0.65 |
|
$3,667 |
|
$0.79 |
|
|
$9,436 |
|
$2.04 |
|
$10,754 |
|
$2.33 |
||||||
Change |
(18.2 |
%) |
|
(17.7 |
%) |
|
|
|
|
|
|
(12.3 |
%) |
|
(12.4 |
%) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Acquisition-related intangible assets are recognized as a result of the application of Accounting Standards Codification Topic 805, Business Combinations (such as customer relationships), and their amortization is significantly affected by the size and timing of our acquisitions. Amortization of intangible assets not resulting from business combinations (such as software and acquired intellectual property rights used in our theme parks) is included in Adjusted Net Income and Adjusted EPS. |
|
Three Months Ended |
|
|
Nine Months Ended |
|||||||
|
2020 |
|
2019 |
|
|
2020 |
|
2019 |
|||
Amortization of acquisition-related intangible assets |
$574 |
|
$486 |
|
|
$1,714 |
|
$1,489 |
|||
Amortization of acquisition-related intangible assets, |
$458 |
|
$385 |
|
|
$1,365 |
|
$1,180 |
(2) | Adjustments for investments include realized and unrealized (gains) losses on equity securities, net (as stated in Table 1), as well as the equity in net (income) losses of investees, net, for our investments in Atairos and Hulu (following May 2019 transaction). |
|
Three Months Ended |
|
|
Nine Months Ended |
|||||||||||||
|
2020 |
|
2019 |
|
|
2020 |
|
2019 |
|||||||||
Realized and unrealized (gains) losses on equity |
($118 |
) |
|
($174 |
) |
|
|
($65 |
) |
|
|
($582 |
) |
|
|||
Equity in net (income) losses of investees, net |
210 |
|
|
363 |
|
|
|
506 |
|
|
|
155 |
|
|
|||
Investments before income taxes |
92 |
|
|
189 |
|
|
|
441 |
|
|
|
(427 |
) |
|
|||
Investments, net of tax |
$70 |
|
|
$141 |
|
|
|
$334 |
|
|
|
($317 |
) |
|
(3) |
3rd quarter and year to date 2020 net income attributable to Comcast Corporation includes $220 million and $360 million of interest expense, $166 million and $272 million net of tax, respectively, resulting from the early redemption of debt. 3rd quarter and year to date 2019 net income attributable to Comcast Corporation includes $56 million of interest expense, $42 million net of tax, resulting from the early redemption of debt. | |
(4) |
3rd quarter and year to date 2020 net income attributable to Comcast Corporation includes $145 million of income tax expense adjustments related to certain tax law changes. 3rd quarter and year to date 2019 net income attributable to Comcast Corporation includes $125 million of income tax benefits related to the impact of certain state tax adjustments. | |
(5) |
3rd quarter and year to date 2020 net income attributable to Comcast Corporation includes $177 million of other operating and administrative expense, $134 million net of tax, related to a potential legal settlement. | |
(6) |
3rd quarter and year to date 2020 net income attributable to Comcast Corporation includes $10 million and $40 million of operating costs and expenses, $8 million and $32 million net of tax, respectively, related to the Sky transaction, primarily relating to the replacement of share-based compensation awards and costs related to integration activities. 3rd quarter and year to date 2019 net income attributable to Comcast Corporation includes $33 million and $168 million of operating costs and expenses, $27 million and $136 million net of tax, respectively, related to the Sky transaction, primarily relating to the replacement of share-based compensation awards and costs related to integration activities. | |
(7) |
3rd quarter 2019 net income attributable to Comcast Corporation includes a gain of $60 million in other income, $45 million net of tax, related to our investment in Hulu and $34 million of other losses, $25 million net of tax, related to an impairment of an equity method investment. 2019 year to date net income attributable to Comcast Corporation also includes a gain of $159 million in other income, $118 million net of tax, related to our investment in Hulu and $56 million of other losses, $42 million net of tax, related to an impairment of an equity method investment. | |
(8) |
2019 year to date net income attributable to Comcast Corporation includes $53 million of depreciation and amortization expense, $39 million net of tax, related to the 4th quarter 2018, as a result of adjustments to the purchase price allocation of Sky, primarily related to intangible assets and property and equipment. | |
Note: Minor differences may exist due to rounding. |
TABLE 6 |
||||||||||||||||||
Reconciliation of Sky Constant Currency Growth (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Three Months Ended |
|
|
Nine Months Ended |
||||||||||||||
|
|
|
||||||||||||||||
(in millions) |
2020 |
|
2019(1) |
|
Change |
|
|
2020 |
|
2019(1) |
|
Change |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Direct-to-Consumer |
$3,943 |
|
|
$3,981 |
|
|
(1.0 |
%) |
|
|
$11,146 |
|
|
$11,504 |
|
|
(3.1 |
%) |
Content |
388 |
|
|
330 |
|
|
17.5 |
% |
|
|
947 |
|
|
1,057 |
|
|
(10.4 |
%) |
Advertising |
462 |
|
|
468 |
|
|
(1.2 |
%) |
|
|
1,296 |
|
|
1,595 |
|
|
(18.7 |
%) |
Revenue |
$4,793 |
|
|
$4,779 |
|
|
0.3 |
% |
|
|
$13,389 |
|
|
$14,156 |
|
|
(5.4 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Operating costs and expenses |
$4,278 |
|
|
$3,836 |
|
|
11.5 |
% |
|
|
$11,574 |
|
|
$11,815 |
|
|
(2.0 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Adjusted EBITDA |
$515 |
|
$943 |
|
|
(45.4 |
%) |
|
|
$1,815 |
|
|
$2,341 |
|
|
(22.5 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
2019 results for entities reporting in currencies other than United States dollars are converted into United States dollars using the average exchange rates from the current period rather than the actual exchange rates in effect during the respective periods. | |
|
||
Note: Minor differences may exist due to rounding. |
TABLE 7 |
|||||||||||||||||||
Reconciliation of Cable Communications RSN Adjustments (Unaudited) |
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
Three Months Ended |
|
|
Nine Months Ended |
||||||||||||||
|
|
|
|
||||||||||||||||
|
Reported |
|
RSN |
|
Adjusted |
|
|
Reported |
|
RSN |
|
Adjusted |
|||||||
Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
High-Speed Internet |
10.1 |
% |
|
(1.1 |
%) |
|
11.2 |
% |
|
|
8.9 |
% |
|
(0.9 |
%) |
|
9.8 |
% |
|
Video |
(2.1 |
%) |
|
(1.3 |
%) |
|
(0.8 |
%) |
|
|
(1.8 |
%) |
|
(1.2 |
%) |
|
(0.6 |
%) |
Total Revenue |
2.9 |
% |
|
(1.0 |
%) |
|
3.9 |
% |
|
|
2.4 |
% |
|
(0.8 |
%) |
|
3.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Programming and production |
(0.6 |
%) |
|
(4.6 |
%) |
|
4.0 |
% |
|
|
(1.3 |
%) |
|
(3.7 |
%) |
|
2.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Adjusted EBITDA |
10.5 |
% |
|
— |
% |
|
10.5 |
% |
|
|
7.4 |
% |
|
— |
% |
|
7.4 |
% |
|
Adjusted EBITDA margin |
290 bps |
|
40 bps |
|
250 bps |
|
|
200 bps |
|
40 bps |
|
160 bps |
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Note: Minor differences may exist due to rounding. Percentages represent year/year growth rates and Adjusted EBITDA margin is presented as year/year basis point change
Deniz Keskin Brand Management at Porsche
How brands need to adapt in a time when our understanding of luxury changes
As the director of Brand Management at Porsche, Deniz Keskin is responsible for the overall development and perception of the Porsche brand. He explains what new luxury means for Porsche and in which direction the brand is heading.
In the 17th century, Louis XIV, the Sun King, built the castle of Versailles — an embodiment of the power and luxurious life of the French royal court draped in gold, art, and ostentation. Today, more than 7.5 million tourists visit the historic monument every year. But probably only very few of them have the same understanding of luxury as Louis XIV.
What is defined as luxury in a society that is subject to rapid change? Today, we experience a shift from pure ownership to identification with specific values and I’m not going out on a limb here when I say that the future zeitgeist will be quite different from the Palace of Versailles. True luxury will be less connotated with the possession of physical goods but with relationships, experiences, and feelings.
People demand a different form of luxury
We can already see that the understanding of luxury is changing within younger generations. It has become more subtle, some might even say more human. Time spent with friends and personal health move into focus. People have a claim to companies that they do not harm the planet, but on the contrary: they are supposed to change something for the better.
What does this mean for companies that manufacture premium products? Like the definition of luxury, the meaning of a brand is constantly changing. To give you an example: The word brand comes from the brand on livestock — in its original meaning, it is intricately linked to ownership. At the end of the 19th century, corner stores with a wide range of different products appeared. Brands had the task of giving customers orientation about the origin or quality of the product. Slowly their role changed, and brands needed to find a way to stand out. Advertising became an art form, again the relationship between a company and its customers changed.
The bond between consumers and brands will deepen in the future
The most recent decisive change took place in 2007 when Apple introduced the iPhone. And thus, a product we always carry close to us and came to develop an extremely close connection with. Smartphones became our closest companions. This is when brands turned into experiences. You don’t need to go to a store anymore to connect to a brand, it’s right at your fingertip. I’m convinced that in the future the bond between customers and companies will become even closer: it will be a relationship. Brands will have an influence on how we define ourselves as a person, we choose them as a good friend.
This fundamental change between brands and customers will lead people to approach every company with a central question: What are you contributing to the world and to society?
Luxury means to be able to live out your dreams
Porsche is in a successful place, but we have to be conscious of the fact that our target groups evolve and that the people who will buy our products in 20 or 30 years will have a different mindset. This is a fundamental change of perspective, which challenges companies to define their very soul, the reason they exist. In other words: we need to be clear about our purpose.
We at Porsche have found our answer: Driven by Dreams. As a brand, the place that we want to have in the hearts and the minds of our fans should be described with the feeling of making a dream come true.
Driven by Dreams: Customers shall connect the Porsche brand with the feeling of making a dream come true.
You can find approaches to our definition of new luxury in new mobility solutions such as Porsche Drive Rental. The premium car rental service was initially launched in 2014 and is today available in five countries. The rental time is flexible — from three hours to 28 days. Just recently, five further locations have been opened in Germany. Another example is the first fully electric sports car, the Taycan. It is a car that gives you the classic feeling of a Porsche on the road, powered by sustainable technologies — interpreting the sports car dream in a completely different way.
This is where the circle closes for which Ferry Porsche laid the foundation stone more than 70 years ago with his quote:
“In the beginning, I looked around and could not find quite the car I dreamed of. So I decided to build it myself.”Ferry Porsche
We believe that in the future, real luxury will be understood as being able to live out your dreams. And that’s what Porsche is all about.
Info
Text published by Deniz Keskin is Director Brand Management at Porsche AG.

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