Peacock streaming service finally turns a profit as Comcast moves to spin off NBCUniversal
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Peacock, NBCUniversal’s streaming service, reached profitability for the first time, boosted by FIFA World Cup, NBA playoffs and reality dating show “Love Island USA.”
The milestone comes as Comcast Corp. prepares to spin off NBCUniversal entertainment and news media businesses into a separate company. Peacock, which launched in 2020, grew its paid subscribers by 4% to 48 million in the second quarter, compared to the previous quarter. The company said Peacock’s earnings before interest, taxes, depreciation and amortization was $189 million.
“In just six years, we built Peacock into a streaming business with real scale in the U.S.,” said Brian Roberts, chairman and co-CEO of Comcast on Thursday in an earnings call, adding that Peacock has added 2 million paid subscribers in each of the last two quarters.
Co-CEO Mike Cavanagh said that performance “reinforces the value of NBC, Telemundo, Bravo, and Peacock together as one integrated media business with continued opportunity to drive stronger engagement, advertising, and profitability into the future.”
Comcast is spinning off its NBCUniversal entertainment and media assets into a separate publicly traded company.
Comcast plans to spin off Peacock, NBC and Telemundo broadcast networks, Bravo, Universal film, television studios and theme parks and British TV service Sky into its own separate company, with a goal of completing the separation in about a year.
Michael J. Wolf, CEO of Activate Consulting, said Peacock’s first profit proves that live sports and premium programming “remain the single most powerful anchors for consumer attention and subscriber growth.”
“As Comcast prepares to spin off NBCUniversal, freeing it from legacy cable, a standalone NBCU is now structurally positioned to compete at the highest level of streaming,” Wolf said in a statement.
A new crop of leaders has emerged, reflecting Silicon Valley’s vast influence.
Peacock was the last major premium subscription video-on-demand service launched by a legacy studio to reach profitability, said Brandon Katz, director of insights and content strategy at Greenlight Analytics. The streaming service is available only in the U.S. and certain U.S. territories. Its reach is much smaller than other rivals like Netflix, which has about 80 million households in the U.S. and Canada.
“It was a long and arduous process for Peacock to reach profitability, and this is obviously a very important step for their business, but one small step in a much larger journey,” Katz said.
The Peacock news was part of Comcast’s earnings results. Comcast said revenue declined 1% to $29.9 billion in the second quarter, compared to a year ago, hurt by the loss of broadband residential customers.
Net income was $3.5 billion, down 68% from a year ago, when its profit was boosted by a $9.4 billion gain from Comcast’s sale of its share in Hulu.
Content and experiences revenue increased 22.9% to $10.7 billion, thanks to increases in advertising and theatrical revenue from popular movies including “The Super Mario Galaxy Movie,” horror movie “Obsession” and the international distribution of “Michael.”
Comcast’s stock closed Thursday at $21.92 a share, down about 7%.
