NBCUniversal Is Becoming “Fairly Indifferent” As To Whether Programming Goes On Streaming Or Linear TV, CEO Jeff Shell Says; Theme Park Success “Defies Logic A Little Bit”

At 15 million paid subscribers, Peacock isn’t on the same level as other streaming services, but NBCUniversal CEO Jeff Shell says that’s no accident.

“Our long-term aspiration for Peacock is to balance out our overall media business,” Shell said during NBCU parent Comcast’s third-quarter earnings call today. “We’ve said all along that our strategy in streaming is different than some of the premium SVOD players like Netflix and Disney+. We view it as a part of our business. We manage it as one. We make decisions on programming as one, we sell advertising across the business as one. As viewership shifts from linear to Peacock, we want Peacock to get to a level and a scale that causes our business to be balanced as consumer sentiments and advertiser sentiments change.”

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At about 30 million monthly active users across free and premium tiers, Shell added, “We’re right on track with what we wanted to do when we built that business.” Investors appeared to agree, sending Comcast shares up 6% in mid-day trading. The quarter overall had pluses and minuses, including an $8.6 million writedown at Sky due to volatility in the UK and Europe and tough comparisons with the Tokyo Olympics quarter a year ago, but the movie and parks businesses were major bright spots for NBCU.

Comcast CEO Brian Roberts added his congratulations to NBCU and the Peacock team on the call, declaring the service has been “super successful” given that it has been in the market for just “a couple of years.”

Assessing how the various parts of Comcast’s overall video business fit together, Roberts said several years ago the management team “saw change coming, and we tried to think like a customer. … Many consumers didn’t want the big video package. Now, we can fight that or we can try to embrace it.”

He cited efforts to branch out with broadband video offerings like Xfinity Flex as well as the company’s emerging wireless business, which now has 5 million customers. Plus, a years-long effort to integrate streaming into Xfinity TV has had positive results.

After the company set records in 2021 for earnings per share and EBITDA, Roberts noted, it is “on pace to do better” in those categories this year, in part because it has become “somewhat indifferent to what the consumer prefers.” Comcast is “very unique,” he argued, in its commitment to “playing offense in a changing world.”

As far as the outlook for Peacock specifically, Shell repeated an analyst’s question raised during the call. “What is the definition of success?” he asked. “It’s really two things.” One is helping to maximize returns on the company’s content, from scripted fare to news to sports. Echoing Roberts, he said NBCU has become “fairly indifferent” as to whether programming airs on linear TV or on Peacock. The second measure of success, he added, is straightforward return on investment. Despite the fact that Peacock’s operating losses widened in the third quarter, Shell said the overall results convince him that “we’re well on our way” toward the goal.

Despite broader economic anxiety due to inflation, fuel costs and foreign currency fluctuation, the NBCU division is seeing “no effects” from any larger malaise, Shell said. Having “no weakness” in the parks unit just two years after it completely shuttered due to Covid “kind of defies logic a little bit,” he added. Investments in parks expansion outlined by Roberts during the call are helping deliver returns, Shell said, with parks revenue surging 42% over a year ago in the quarter to reach $2.1 billion.

The Epic Universe site in Florida, which is scheduled to open in 2025, will create a “week-long destination” for visitors, Roberts predicted.

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