Our businesses may be affected by, among other things, the following:
•our businesses operate in highly competitive and dynamic industries, and our businesses and results of operations could be adversely affected if we do not compete effectively
•changes in consumer behavior continue to adversely affect our businesses and challenge existing business models
•a decline in advertisers’ expenditures or changes in advertising markets could negatively impact our businesses
•our success depends on consumer acceptance of our content, and our businesses may be adversely affected if our content fails to achieve sufficient consumer acceptance
•programming expenses for our video services are increasing on a per subscriber basis, which could adversely affect our video businesses
•the loss of programming distribution agreements, or the renewal of these agreements on less favorable terms, could adversely affect our businesses
•our businesses depend on using and protecting certain intellectual property rights and on not infringing the intellectual property rights of others
•we may be unable to obtain necessary hardware, software and operational support
•our businesses depend on keeping pace with technological developments
•a cyber attack, information or security breach, or technology disruption or failure may negatively impact our ability to conduct our business or result in the misuse of confidential information, all of which could adversely affect our business, reputation and results of operations
•weak economic conditions may have a negative impact on our businesses
•acquisitions and other strategic initiatives present many risks, and we may not realize the financial and strategic goals that we had contemplated
•we face risks relating to doing business internationally that could adversely affect our businesses
•natural disasters, severe weather and other uncontrollable events could adversely affect our business, reputation and results of operations
•the loss of key management personnel or popular on-air and creative talent could have an adverse effect on our businesses
•labor disputes, whether involving employees or sports organizations, may disrupt our operations and adversely affect our businesses
•we are subject to regulation by federal, state, local and foreign authorities, which impose additional costs and restrictions on our businesses
•unfavorable litigation or governmental investigation results could require us to pay significant amounts or lead to onerous operating procedures
•our Class B common stock has substantial voting rights and separate approval rights over several potentially material transactions, and our Chairman and CEO has considerable influence over our company through his beneficial ownership of our Class B common stock
Property and equipment, net of accumulated depreciation of $60,114 and $58,701
61,775
59,686
Goodwill
60,076
59,268
Franchise rights
59,365
59,365
Other intangible assets, net of accumulated amortization of $34,162 and $30,290
26,423
27,867
Other noncurrent assets, net
12,686
12,333
Total assets
$
269,871
$
264,811
Liabilities and Equity
Current Liabilities:
Accounts payable and accrued expenses related to trade creditors
$
11,779
$
12,437
Accrued participations and residuals
1,476
1,671
Deferred revenue
3,778
3,242
Accrued expenses and other current liabilities
8,977
11,613
Current portion of debt
2,610
2,069
Advance on sale of investment
9,167
9,167
Total current liabilities
37,786
40,198
Noncurrent portion of debt
98,754
95,021
Deferred income taxes
26,263
26,003
Other noncurrent liabilities
20,526
20,122
Commitments and contingencies
Redeemable noncontrolling interests
224
241
Equity:
Preferred stock—authorized, 20,000,000 shares; issued, zero
—
—
Class A common stock, $0.01 par value—authorized, 7,500,000,000 shares; issued, 4,697,741,828 and 4,842,108,959; outstanding, 3,824,950,800 and 3,969,317,931
47
48
Class B common stock, $0.01 par value—authorized, 75,000,000 shares; issued and outstanding, 9,444,375
—
—
Additional paid-in capital
38,147
38,533
Retained earnings
55,105
52,892
Treasury stock, 872,791,028 Class A common shares
(7,517)
(7,517)
Accumulated other comprehensive income (loss)
(8)
(1,253)
Total Comcast Corporation shareholders’ equity
85,774
82,703
Noncontrolling interests
544
523
Total equity
86,318
83,226
Total liabilities and equity
$
269,871
$
264,811
See accompanying notes to condensed consolidated financial statements.
We have prepared these unaudited condensed consolidated financial statements based on SEC rules that permit reduced disclosure for interim periods. These financial statements include all adjustments that are necessary for a fair presentation of our consolidated results of operations, cash flows and financial condition for the periods shown, including normal, recurring accruals and other items. The consolidated results of operations for the interim periods presented are not necessarily indicative of results for the full year.
The year-end condensed consolidated balance sheet was derived from audited financial statements but does not include all disclosures required by generally accepted accounting principles in the United States (“GAAP”). For a more complete discussion of our accounting policies and certain other information, refer to our consolidated financial statements included in our 2023 Annual Report on Form 10-K.
Recent Accounting Pronouncements
Segment Disclosures
In November 2023, the Financial Accounting Standards Board (“FASB”) issued updated accounting guidance related to annual and interim segment disclosures. The updated accounting guidance, among other things, will result in our disclosure of certain significant segment expenses. We will adopt the updated accounting guidance on a retrospective basis in our Annual Report on Form 10-K for the year ended December 31, 2024.
Income Tax Disclosures
In December 2023, the FASB issued updated accounting guidance related to income tax disclosures. The updated accounting guidance, among other things, requires additional disclosure primarily related to the income tax rate reconciliation and income taxes paid. We will adopt the updated accounting guidance in our Annual Report on Form 10-K for the year ended December 31, 2025.
We are a global media and technology company with five segments: Residential Connectivity & Platforms, Business Services Connectivity, Media, Studios and Theme Parks.
Our financial data by segment is presented in the tables below. We do not present asset information for our segments as this information is not used to allocate resources.
Three Months Ended September 30, 2024
(in millions)
Residential Connectivity & Platforms
Business Services Connectivity
Media
Studios
Theme Parks
Total
Revenue from external customers
$
17,807
$
2,419
$
6,926
$
1,993
$
2,289
$
31,434
Intersegment revenue(a)
59
6
1,305
833
—
2,203
17,866
2,425
8,231
2,826
2,289
33,637
Reconciliation of Revenue
Other revenue(b)
686
Eliminations(a)
(2,253)
Total consolidated revenue
$
32,070
Segment Adjusted EBITDA(c)
$
6,904
$
1,391
$
650
$
468
$
847
$
10,259
Reconciliation of total segment Adjusted EBITDA
Media, Studios and Theme Parks headquarters and other(d)
(200)
Corporate and other(b)(c)
(300)
Eliminations
(21)
Depreciation
(2,219)
Amortization
(1,659)
Interest expense
(1,037)
Investment and other income (loss), net
(3)
Income before income taxes
$
4,819
Three Months Ended September 30, 2023
(in millions)
Residential Connectivity & Platforms
Business Services Connectivity
Media
Studios
Theme Parks
Total
Revenue from external customers
$
17,901
$
2,314
$
4,869
$
1,994
$
2,419
$
29,497
Intersegment revenue(a)
50
6
1,160
524
(1)
1,739
17,951
2,320
6,029
2,518
2,418
31,236
Reconciliation of Revenue
Other revenue(b)
656
Eliminations(a)
(1,777)
Total consolidated revenue
$
30,115
Segment Adjusted EBITDA(c)
$
6,886
$
1,335
$
723
$
429
$
983
$
10,356
Reconciliation of total segment Adjusted EBITDA
Media, Studios and Theme Parks headquarters and other(d)
Media, Studios and Theme Parks headquarters and other(d)
(642)
Corporate and other(b)(c)
(881)
Eliminations
22
Depreciation
(6,548)
Amortization
(4,421)
Interest expense
(3,065)
Investment and other income (loss), net
(140)
Income before income taxes
$
15,099
Nine Months Ended September 30, 2023
(in millions)
Residential Connectivity & Platforms
Business Services Connectivity
Media
Studios
Theme Parks
Total
Revenue from external customers
$
53,742
$
6,878
$
14,884
$
6,328
$
6,577
$
88,409
Intersegment revenue(a)
146
17
3,492
2,233
(1)
5,886
53,888
6,894
18,376
8,561
6,576
94,296
Reconciliation of Revenue
Other revenue(b)
2,048
Eliminations(a)
(6,025)
Total consolidated revenue
$
90,319
Segment Adjusted EBITDA(c)
$
20,672
$
3,988
$
2,847
$
961
$
2,473
$
30,941
Reconciliation of total segment Adjusted EBITDA
Media, Studios and Theme Parks headquarters and other(d)
(610)
Corporate and other(b)(c)
(824)
Eliminations
131
Depreciation
(6,662)
Amortization
(4,146)
Interest expense
(3,068)
Investment and other income (loss), net
672
Income before income taxes
$
16,434
(a)Our most significant intersegment revenue transactions include distribution revenue in Media related to fees from Residential Connectivity & Platforms for the rights to distribute television programming, and content licensing revenue in Studios for licenses of owned content to Media.
(b)Includes the operations of our Sky-branded video services and television networks in Germany; Comcast Spectacor, which owns the Philadelphia Flyers and the Wells Fargo Center arena in Philadelphia, Pennsylvania; and Xumo, our consolidated streaming platform joint venture with Charter Communications. Corporate and other also includes overhead and personnel costs for Corporate.
(c)We use Adjusted EBITDA as the measure of profit or loss for our segments. From time to time we may report the impact of certain events, gains, losses or other charges related to our segments within Corporate and other.
(d)Includes overhead, personnel costs and costs associated with corporate initiatives for our Media, Studios and Theme Park segments.
Total Residential Connectivity & Platforms Segment
17,866
17,951
53,558
53,888
Total Business Services Connectivity Segment
2,425
2,320
7,253
6,894
Domestic advertising
3,347
1,913
7,363
5,965
Domestic distribution
3,272
2,591
8,942
7,916
International networks
1,070
1,019
3,193
3,062
Other
542
506
1,429
1,433
Total Media Segment
8,231
6,029
20,926
18,376
Content licensing
1,865
1,691
5,680
5,856
Theatrical
611
504
1,178
1,735
Other
350
324
964
970
Total Studios Segment
2,826
2,518
7,822
8,561
Total Theme Parks Segment
2,289
2,418
6,243
6,576
Other revenue
686
656
2,181
2,048
Eliminations(a)
(2,253)
(1,777)
(6,167)
(6,025)
Total revenue
$
32,070
$
30,115
$
91,817
$
90,319
(a)See Note 2 for additional information on intersegment revenue transactions.
Condensed Consolidated Balance Sheets
(in millions)
September 30, 2024
December 31, 2023
Receivables, gross
$
14,798
$
14,511
Less: Allowance for credit losses
763
698
Receivables, net
$
14,036
$
13,813
The following table summarizes our other balances that are not separately presented in our condensed consolidated balance sheets that relate to the recognition of revenue and collection of the related cash.
(in millions)
September 30, 2024
December 31, 2023
Noncurrent receivables, net (included in other noncurrent assets, net)
$
1,782
$
1,914
Noncurrent deferred revenue (included in other noncurrent liabilities)
$
650
$
618
Our accounts receivables include amounts not yet billed related to equipment installment plans, as summarized in the table below.
(in millions)
September 30, 2024
December 31, 2023
Receivables, net
$
1,808
$
1,695
Noncurrent receivables, net (included in other noncurrent assets, net)
(a) Amount includes amortization of owned content of $1.6 billion and $5.6 billion for the three and nine months ended September 30, 2024, respectively, and $1.6 billion and $5.9 billion for the three and nine months ended September 30, 2023, respectively, as well as participations and residuals expenses.
Capitalized Film and Television Costs
(in millions)
September 30, 2024
December 31, 2023
Owned:
In production and in development
$
3,566
$
2,893
Completed, not released
428
317
Released, less amortization
4,266
4,340
8,261
7,551
Licensed, including sports advances
5,080
5,369
Film and television costs
$
13,340
$
12,920
Note 5: Debt
As of September 30, 2024, our debt had a carrying value of $101.4 billion and an estimated fair value of $96.8 billion. As of December 31, 2023, our debt had a carrying value of $97.1 billion and an estimated fair value of $92.2 billion. The estimated fair value of our publicly traded debt was primarily based on Level 1 inputs that use quoted market value for the debt. The estimated fair value of debt for which there are no quoted market prices was based on Level 2 inputs that use interest rates available to us for debt with similar terms and remaining maturities.
In May 2024, we entered into a new $11.8 billion revolving credit facility with a syndicate of banks, due May 17, 2029, that may be used for general corporate purposes. We may increase the commitments under the facility up to a total of $14.8 billion, as well as extend the expiration date to no later than May 17, 2031, subject to the approval of the lenders. The interest rate consists of a benchmark rate plus a borrowing margin that is determined based on Comcast’s credit rating. As of September 30, 2024, the borrowing margin for borrowings based on the Adjusted Term SOFR Rate, as defined in the agreement, was 0.875%. The facility requires that we maintain a certain financial ratio based on debt and EBITDA, as defined in the agreement. In connection with our entry into the new credit facility, we terminated our prior credit facility dated as of March 30, 2021, and as of September 30, 2024 and December 31, 2023, we had no borrowings outstanding under the new and prior credit facility, respectively. As of September 30, 2024, amounts available under our new credit facility, net of amounts outstanding under our commercial paper program and outstanding letters of credit and bank guarantees, totaled $11.8 billion.
Note 6: Investments and Variable Interest Entities
Investment and Other Income (Loss), Net
Three Months Ended September 30,
Nine Months Ended September 30,
(in millions)
2024
2023
2024
2023
Equity in net income (losses) of investees, net
$
(152)
$
49
$
(438)
$
454
Realized and unrealized gains (losses) on equity securities, net
(22)
(87)
(163)
(130)
Other income (loss), net
171
88
461
349
Investment and other income (loss), net
$
(3)
$
50
$
(140)
$
672
The amount of unrealized gains (losses), net recognized in the three months ended September 30, 2024 and 2023 that related to marketable and nonmarketable equity securities still held as of the end of each reporting period was $(15) million and $(82) million, respectively. The amount of unrealized gains (losses), net recognized in the nine months ended September 30, 2024 and 2023 that related to marketable and nonmarketable equity securities still held as of the end of each reporting period was $(117) million and $(145) million, respectively.
Investments
(in millions)
September 30, 2024
December 31, 2023
Equity method
$
7,516
$
7,615
Marketable equity securities
21
39
Nonmarketable equity securities
1,380
1,482
Other investments
206
559
Total investments
9,122
9,694
Less: Current investments
101
310
Noncurrent investments
$
9,021
$
9,385
Equity Method Investments
The amount of cash distributions received from equity method investments presented within operating activities in the condensed consolidated statements of cash flows in the nine months ended September 30, 2024 and 2023 was $244 million and $185 million, respectively.
Atairos
Atairos is a variable interest entity (“VIE”) that follows investment company accounting and records its investments at their fair values each reporting period with the net gains or losses reflected in its statement of operations. We recognize our share of these gains and losses in equity in net income (losses) of investees, net. For the nine months ended September 30, 2024 and 2023, we made cash capital contributions to Atairos totaling $60 million and $132 million, respectively. As of September 30, 2024 and December 31, 2023, our investment in Atairos, inclusive of certain distributions retained by Atairos on our behalf and classified as advances within other investments, was $5.3 billion and $5.5 billion, respectively. As of September 30, 2024, our remaining unfunded capital commitment was $1.4 billion.
Other Investments
Other investments also includes certain short-term instruments, which totaled $70 million and $254 million as of September 30, 2024 and December 31, 2023, respectively. The carrying amounts of these investments approximate their fair values, which are primarily based on Level 2 inputs that use interest rates for instruments with similar terms and remaining maturities. Proceeds from short-term instruments for the nine months ended September 30, 2024 and 2023 were $632 million and $339 million, respectively. Purchases of short-term instruments for the nine months ended September 30, 2024 and 2023 were $443 million and $286 million, respectively.
We own a 30% interest in a Universal theme park and resort in Beijing, China (“Universal Beijing Resort”). Universal Beijing Resort is a consolidated VIE with the remaining interest owned by a consortium of Chinese state-owned companies. The construction was funded through a combination of debt financing and equity contributions from the partners in accordance with their equity interests. As of September 30, 2024, Universal Beijing Resort had $3.6 billion of debt outstanding, including $3.2 billion principal amount of a term loan outstanding under the debt financing agreement. As of December 31, 2023, Universal Beijing Resort had $3.5 billion of debt outstanding, including $3.1 billion principal amount of a term loan outstanding under the debt financing agreement.
As of September 30, 2024, our condensed consolidated balance sheets included assets and liabilities of Universal Beijing Resort totaling $7.7 billion and $7.3 billion, respectively. As of December 31, 2023, our condensed consolidated balance sheets included assets and liabilities of Universal Beijing Resort totaling $7.8 billion and $7.2 billion, respectively. The assets and liabilities of Universal Beijing Resort primarily consist of property and equipment, operating lease assets and liabilities, and debt.
Note 7: Equity and Share-Based Compensation
Weighted-Average Common Shares Outstanding
Three Months Ended September 30,
Nine Months Ended September 30,
(in millions)
2024
2023
2024
2023
Weighted-average number of common shares outstanding – basic
3,861
4,109
3,908
4,160
Effect of dilutive securities
18
33
22
23
Weighted-average number of common shares outstanding – diluted
3,880
4,141
3,930
4,184
Antidilutive securities
188
86
193
172
Weighted-average common shares outstanding used in calculating diluted earnings per common share attributable to Comcast Corporation shareholders (“diluted EPS”) considers the impact of potentially dilutive securities using the treasury stock method. Antidilutive securities represent the number of potential common shares related to share-based compensation awards that were excluded from diluted EPS because their effect would have been antidilutive.
Accumulated Other Comprehensive Income (Loss)
(in millions)
September 30, 2024
December 31, 2023
Cumulative translation adjustments
$
(275)
$
(1,596)
Deferred gains (losses) on cash flow hedges
16
49
Unrecognized gains (losses) on employee benefit obligations and other
251
293
Accumulated other comprehensive income (loss), net of deferred taxes
$
(8)
$
(1,253)
Share-Based Compensation
Our share-based compensation plans consist primarily of awards of restricted share units (“RSUs”) and stock options to certain employees and directors as part of our long-term incentive compensation structure. Additionally, through our employee stock purchase plans, employees are able to purchase shares of our common stock at a discount through payroll deductions.
In March 2024, we granted 31 million RSUs and 3 million stock options under our annual management awards program. The weighted-average fair values associated with these grants were $42.62 per RSU and $9.49 per stock option. During the three months ended September 30, 2024 and 2023, share-based compensation expense recognized in our condensed consolidated statements of income was $247 million and $238 million, respectively. During the nine months ended September 30, 2024 and 2023, share-based compensation expense recognized in our condensed consolidated statements of income was $811 million and $786 million, respectively. As of September 30, 2024, we had unrecognized pretax compensation expense of $2.3 billion related to unvested RSUs and unvested stock options.
a) Cash payments for income taxes in the nine months ended September 30, 2024 include $1.2 billion related to the purchase of transferable tax credits.
Noncash Activities
During the nine months ended September 30, 2024:
•we acquired $2.4 billion of property and equipment and intangible assets that were accrued but unpaid
•we recorded a liability of $1.2 billion for a quarterly cash dividend of $0.31 per common share paid in October 2024
During the nine months ended September 30, 2023:
•we acquired $2.2 billion of property and equipment and intangible assets that were accrued but unpaid
•we recorded a liability of $1.2 billion for a quarterly cash dividend of $0.29 per common share paid in October 2023
Cash, Cash Equivalents and Restricted Cash
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the condensed consolidated balance sheets to the total of the amounts reported in our condensed consolidated statements of cash flows.
(in millions)
September 30, 2024
December 31, 2023
Cash and cash equivalents
$
8,814
$
6,215
Restricted cash included in other current assets and other noncurrent assets, net
64
67
Cash, cash equivalents and restricted cash, end of period
$
8,878
$
6,282
Note 9: Commitments and Contingencies
Contingencies
We are subject to legal proceedings and claims that arise in the ordinary course of our business. While the amount of ultimate liability with respect to such proceedings and claims is not expected to materially affect our results of operations, cash flows or financial position, any such legal proceedings or claims could be time-consuming and injure our reputation.
ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion is provided as a supplement to, and should be read in conjunction with, the condensed consolidated financial statements and related notes (“Notes”) included in this Quarterly Report on Form 10-Q and our 2023 Annual Report on Form 10-K.
Overview
We are a global media and technology company with two primary businesses: Connectivity & Platforms and Content & Experiences. We present the operations of (1) our Connectivity & Platforms business in two segments: Residential Connectivity & Platforms and Business Services Connectivity; and (2) our Content & Experiences business in three segments: Media, Studios and Theme Parks.
Consolidated Operating Results
Three Months Ended September 30,
Change
Nine Months Ended September 30,
Change
(in millions, except per share data)
2024
2023
%
2024
2023
%
Revenue
$
32,070
$
30,115
6.5
%
$
91,817
$
90,319
1.7
%
Costs and Expenses:
Programming and production
10,216
8,652
18.1
27,000
26,506
1.9
Marketing and promotion
1,989
1,866
6.6
5,929
5,929
—
Other operating and administrative
10,128
9,629
5.2
29,615
28,247
4.8
Depreciation
2,219
2,203
0.7
6,548
6,662
(1.7)
Amortization
1,659
1,290
28.6
4,421
4,146
6.6
Total costs and expenses
26,211
23,640
10.9
73,512
71,489
2.8
Operating income
5,859
6,475
(9.5)
18,304
18,830
(2.8)
Interest expense
(1,037)
(1,060)
(2.2)
(3,065)
(3,068)
(0.1)
Investment and other income (loss), net
(3)
50
NM
(140)
672
NM
Income before income taxes
4,819
5,465
(11.8)
15,099
16,434
(8.1)
Income tax expense
(1,243)
(1,468)
(15.3)
(3,906)
(4,481)
(12.8)
Net income
3,576
3,997
(10.5)
11,192
11,954
(6.4)
Less: Net income (loss) attributable to noncontrolling interests
(53)
(49)
8.7
(222)
(175)
27.1
Net income attributable to Comcast Corporation
$
3,629
$
4,046
(10.3)
%
$
11,415
$
12,128
(5.9)
%
Basic earnings per common share attributable to Comcast Corporation shareholders
$
0.94
$
0.98
(4.5)
%
$
2.92
$
2.92
0.2
%
Diluted earnings per common share attributable to Comcast Corporation shareholders
$
0.94
$
0.98
(4.2)
%
$
2.90
$
2.90
0.2
%
Weighted-average number of common shares outstanding – basic
3,861
4,109
(6.0)
%
3,908
4,160
(6.1)
%
Weighted-average number of common shares outstanding – diluted
3,880
4,141
(6.3)
%
3,930
4,184
(6.1)
%
Adjusted EBITDA(a)
$
9,735
$
9,962
(2.3)
%
$
29,261
$
29,621
(1.2)
%
Percentage changes that are considered not meaningful are denoted with NM.
(a)Adjusted EBITDA is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section on page 24 for additional information, including our definition and our use of Adjusted EBITDA, and for a reconciliation from net income attributable to Comcast Corporation to Adjusted EBITDA.
Consolidated revenue increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily driven by increases in the Content & Experiences business and Corporate and Other. Revenue for our segments and other businesses is discussed separately below under the heading “Segment Operating Results.”
Consolidated costs and expenses, excluding depreciation and amortization expense, increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily driven by increases in the Content & Experiences business and Corporate and Other. Costs and expenses for our segments and our corporate operations and other businesses are discussed separately below under the heading “Segment Operating Results.”
Consolidated depreciation and amortization expense increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to increased amortization of certain acquisition-related intangible assets related to the linear media business. Consolidated depreciation and amortization expense for the nine months ended September 30, 2024 was partially offset by decreased depreciation of international property and equipment and decreased amortization of software.
Amortization expense from acquisition-related intangible assets totaled $817 million and $1.9 billion for the three and nine months ended September 30, 2024, respectively, and $571 million and $1.7 billion for the three and nine months ended September 30, 2023, respectively. Amounts primarily relate to customer relationship intangible assets recorded in connection with the Sky transaction in 2018 and the NBCUniversal transaction in 2011.
Consolidated interest expense decreased for the three months ended September 30, 2024 and was consistent for the nine months ended September 30, 2024 primarily due to interest expense in the prior year periods associated with a collateralized obligation that was repaid in the fourth quarter of 2023, offset by increases in average debt outstanding and higher weighted-average interest rates in the current year periods.
Consolidated investment and other income (loss), net decreased for the three and nine months ended September 30, 2024 compared to the same periods in 2023.
Three Months Ended September 30,
Nine Months Ended September 30,
(in millions)
2024
2023
2024
2023
Equity in net income (losses) of investees, net
$
(152)
$
49
$
(438)
$
454
Realized and unrealized gains (losses) on equity securities, net
(22)
(87)
(163)
(130)
Other income (loss), net
171
88
461
349
Total investment and other income (loss), net
$
(3)
$
50
$
(140)
$
672
The change in equity in net income (losses) of investees, net was primarily due to our investment in Atairos. The income (losses) at Atairos were driven by fair value adjustments on its underlying investments with income (loss) of $(93) million and $(289) million for the three and nine months ended September 30, 2024, respectively, and $252 million and $753 million for the three and nine months ended September 30, 2023, respectively.
The change in realized and unrealized gains (losses) on equity securities, net for the three months ended September 30, 2024 was primarily due to higher losses on nonmarketable securities in the prior year period and losses on marketable securities in the prior year period. The change in realized and unrealized gains (losses) on equity securities, net for the nine months ended September 30, 2024 was primarily due to higher losses on marketable and nonmarketable securities in the current year period.
The increase in other income (loss), net for the three and nine months ended September 30, 2024 primarily resulted from insurance contracts and foreign exchange remeasurement.
Consolidated income tax expense for the three and nine months ended September 30, 2024 and 2023 reflects an effective income tax rate that differs from the federal statutory rate due to state and foreign income taxes and adjustments associated with uncertain tax positions. The decreases in income tax expense for the three and nine months ended September 30, 2024 compared to the same periods in 2023 were primarily driven by lower domestic income before income taxes.
Consolidated net income (loss) attributable to noncontrolling interests changed for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to our regional sports networks. The change for the three months ended September 30, 2024 was partially offset by Universal Beijing Resort.
Our segment operating results are presented based on how we assess operating performance and internally report financial information. See Note 2 for additional information on our segments.
Connectivity & Platforms Results of Operations
Three Months Ended September 30,
Change
Constant Currency Change(b)
Nine Months Ended September 30,
Change
Constant Currency Change(b)
(in millions)
2024
2023
%
%
2024
2023
%
%
Revenue
Residential Connectivity & Platforms
$
17,866
$
17,951
(0.5)
%
(1.0)
%
$
53,558
$
53,888
(0.6)
%
(1.1)
%
Business Services Connectivity
2,425
2,320
4.5
4.5
7,253
6,894
5.2
5.2
Total Connectivity & Platforms revenue
$
20,291
$
20,271
0.1
%
(0.4)
%
$
60,812
$
60,783
—
%
(0.4)
%
Adjusted EBITDA
Residential Connectivity & Platforms
$
6,904
$
6,886
0.3
%
—
%
$
20,859
$
20,672
0.9
%
0.7
%
Business Services Connectivity
1,391
1,335
4.2
4.3
4,137
3,988
3.7
3.7
Total Connectivity & Platforms Adjusted EBITDA
$
8,295
$
8,221
0.9
%
0.7
%
$
24,996
$
24,660
1.4
%
1.2
%
Adjusted EBITDA Margin(a)
Residential Connectivity & Platforms
38.6
%
38.4
%
20 bps
40 bps
38.9
%
38.4
%
50 bps
60 bps
Business Services Connectivity
57.4
57.5
(10) bps
(10) bps
57.0
57.8
(80) bps
(80) bps
Total Connectivity & Platforms Adjusted EBITDA margin
40.9
%
40.6
%
30 bps
50 bps
41.1
%
40.6
%
50 bps
60 bps
(a)Our Adjusted EBITDA margin is Adjusted EBITDA as a percentage of revenue. We believe this metric is useful particularly as we continue to focus on growing our higher-margin businesses and improving overall operating cost management. The changes reflect the year-over-year basis point changes in the rounded Adjusted EBITDA margins.
(b)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section on page 24 for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency amounts.
We continue to focus on growing our higher-margin connectivity businesses while managing overall operating costs. We also continue to invest in our network to support higher-speed broadband offerings and to expand the number of homes and businesses passed. A competitive environment, which has increased in recent years, and continued low domestic household move levels have had negative impacts on our customer relationships additions/(losses). In addition, funding for the Affordable Connectivity Program, which provided a monthly discount towards broadband service for eligible low-income households, expired during the second quarter of 2024 and resulted in an estimated net loss of 96,000 residential domestic broadband customers for the third quarter of 2024. We believe our residential connectivity revenue will increase as a result of growth in average domestic broadband revenue per customer, as well as increases in domestic wireless and international connectivity revenue. At the same time, we expect continued declines in video revenue as a result of domestic customer net losses due to shifting video consumption patterns and the competitive environment, although customer net losses typically mitigate the impact of continued rate increases on programming expenses. We also expect continued declines in other revenue related to declines in wireline voice revenue. We believe our Business Services Connectivity segment will continue to grow by offering competitive services, including to medium-sized and enterprise customers. Global economic conditions and consumer sentiment have in the past adversely impacted, and may continue to adversely impact, demand for our products and services and our results of operations.
International Residential Connectivity & Platforms customer relationships(a)
17,716
17,958
78
74
(131)
18
Business Services Connectivity customer relationships(b)
2,627
2,640
(4)
5
(14)
15
Total Connectivity & Platforms customer relationships
51,667
52,320
(29)
40
(469)
(105)
Domestic Broadband
Residential customers
29,504
29,779
(79)
(17)
(244)
(33)
Business customers
2,477
2,508
(8)
(2)
(28)
1
Total domestic broadband customers
31,981
32,287
(87)
(18)
(272)
(32)
Domestic Wireless
Total domestic wireless lines(c)
7,519
6,278
319
294
930
965
Domestic Video
Total domestic video customers
12,834
14,495
(365)
(490)
(1,272)
(1,647)
Domestic homes and businesses passed(d)
63,355
62,086
Domestic broadband penetration of homes and businesses passed(e)
50.3
%
51.8
%
(a)Residential Connectivity & Platforms customer relationships generally represent the number of residential customer locations that subscribe to at least one of our services. International Residential Connectivity & Platforms customer relationships represent customers receiving Sky services in the United Kingdom and Italy. Because each of our services includes a variety of product tiers, which may change from time to time, net additions or losses in any one period will reflect a mix of customers at various tiers.
(b)Business Services Connectivity customer metrics are generally counted based on the number of locations receiving services, including locations within our network in the United States, as well as locations outside of our network both in the United States and internationally. Certain arrangements whereby third parties provide connectivity services leveraging our network are also generally counted based on the number of locations served.
(c)Domestic wireless lines represent the number of residential and business customers’ wireless devices. An individual customer relationship may have multiple wireless lines.
(d)Connectivity & Platforms domestic homes and businesses are considered passed if we can connect them to our network in the United States without further extending the transmission lines. Homes and businesses passed is an estimate based on the best available information.
(e)Penetration is calculated by dividing the number of domestic customers located within our network by the number of domestic homes and businesses passed.
Three Months Ended September 30,
Change
Constant Currency Change(a)
Nine Months Ended September 30,
Change
Constant Currency Change(a)
2024
2023
%
%
2024
2023
%
%
Average monthly total Connectivity & Platforms revenue per customer relationship
$
130.87
$
129.20
1.3
%
0.8
%
$
130.19
$
128.95
1.0
%
0.5
%
Average monthly total Connectivity & Platforms Adjusted EBITDA per customer relationship
$
53.50
$
52.40
2.1
%
1.9
%
$
53.51
$
52.32
2.3
%
2.1
%
(a)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section on page 24 for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency amounts.
Average monthly total revenue per customer relationship is impacted by rate adjustments and changes in the types and levels of services received by our residential and business customers, as well as changes in advertising and other revenue and in foreign currency exchange rates. While revenue from our individual service offerings is also impacted by changes in the allocation of revenue among services sold in a bundle, the allocation does not impact average monthly total revenue per customer relationship. Each of our services has a different contribution to Adjusted EBITDA margin. We use average monthly Adjusted EBITDA per customer relationship to evaluate the profitability of our customer base across our service offerings. We believe both metrics are useful to understand the trends in our business, and average monthly Adjusted EBITDA per customer relationship is useful particularly as we continue to focus on growing our higher-margin businesses.
Connectivity & Platforms — Supplemental Costs and Expenses Information
Connectivity & Platforms supplemental costs and expenses information in the table below is presented on an aggregate basis across the Connectivity & Platforms segments as the segments use certain shared infrastructure, including our network in the United States. Costs and expenses information reported separately for the Residential Connectivity & Platforms and Business Services Connectivity segments includes each segment’s direct costs and an allocation of shared costs.
Three Months Ended September 30,
Change
Constant Currency Change(g)
Nine Months Ended September 30,
Change
Constant Currency Change(g)
(in millions)
2024
2023
%
%
2024
2023
%
%
Costs and Expenses
Programming(a)
$
4,102
$
4,460
(8.0)
%
(8.6)
%
$
12,756
$
13,638
(6.5)
%
(7.0)
%
Technical and support(b)
1,908
1,867
2.2
1.8
5,712
5,525
3.4
3.0
Direct product costs(c)
1,675
1,554
7.8
6.2
4,705
4,362
7.8
6.4
Marketing and promotion(d)
1,234
1,169
5.5
4.9
3,547
3,585
(1.0)
(1.5)
Customer service(e)
680
692
(1.7)
(2.1)
2,072
2,097
(1.2)
(1.6)
Other(f)
2,395
2,308
3.8
3.1
7,023
6,915
1.6
1.0
Total Connectivity & Platforms costs and expenses
$
11,996
$
12,050
(0.4)
%
(1.1)
%
$
35,816
$
36,122
(0.8)
%
(1.4)
%
(a)Programming expenses, which represent our most significant operating expense, are the fees we incur to provide video services to our customers, and primarily include fees related to the distribution of television network programming and fees charged for retransmission of the signals from local broadcast television stations. These expenses also include the costs of content on the Sky-branded entertainment television networks, including amortization of licensed content.
(b)Technical and support expenses primarily include costs for labor to complete service call and installation activities; and costs for network operations and satellite transmission, product development, fulfillment and provisioning.
(c)Direct product costs primarily include access fees related to using wireless and broadband networks owned by third parties to deliver our services and costs of products sold, including wireless devices and Sky Glass smart televisions.
(d)Marketing and promotion expenses include the costs associated with attracting new customers and promoting our service offerings.
(e)Customer service expenses include the personnel and other costs associated with customer service and certain selling activities.
(f)Other expenses primarily include administrative personnel costs; franchise and other regulatory fees; fees paid to third parties where we represent the advertising sales efforts; other business support costs, including building and office expenses, taxes and billing costs; and bad debt.
(g)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section on page 24 for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency amounts.
Residential Connectivity & Platforms Segment Results of Operations
Three Months Ended September 30,
Change
Constant Currency Change(a)
Nine Months Ended September 30,
Change
Constant Currency Change(a)
(in millions)
2024
2023
%
%
2024
2023
%
%
Revenue
Domestic broadband
$
6,539
$
6,366
2.7
%
2.7
%
$
19,700
$
19,086
3.2
%
3.2
%
Domestic wireless
1,093
917
19.2
19.2
3,084
2,644
16.6
16.6
International connectivity
1,236
1,109
11.4
8.3
3,500
3,009
16.3
13.4
Total residential connectivity
8,869
8,393
5.7
5.3
26,284
24,739
6.2
5.9
Video
6,713
7,154
(6.2)
(6.8)
20,370
21,895
(7.0)
(7.5)
Advertising
987
960
2.7
1.6
2,931
2,860
2.5
1.6
Other
1,298
1,444
(10.1)
(10.7)
3,973
4,394
(9.6)
(10.2)
Total revenue
17,866
17,951
(0.5)
(1.0)
53,558
53,888
(0.6)
(1.1)
Costs and Expenses
Programming
4,102
4,460
(8.0)
(8.6)
12,756
13,638
(6.5)
(7.0)
Other
6,860
6,605
3.9
3.0
19,943
19,578
1.9
1.1
Total costs and expenses
10,962
11,065
(0.9)
(1.7)
32,699
33,216
(1.6)
(2.2)
Adjusted EBITDA
$
6,904
$
6,886
0.3
%
—
%
$
20,859
$
20,672
0.9
%
0.7
%
(a)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section on page 24 for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency amounts.
Domestic broadband revenueincreased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 due to increases in average rates.
Domestic wireless revenue increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to increases in the number of customer lines and device sales.
International connectivity revenue increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to increases in broadband revenue resulting from an increase in average rates. The increase for the nine months ended September 30, 2024 also includes an increase in wireless revenue primarily resulting from an increase in the sale of wireless services. The increases for the three and nine months ended September 30, 2024 include the positive impact of foreign currency.
Video revenue decreased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 due to declines in the overall number of video customers, partially offset by overall increases in average rates.
Advertising revenue increased for the three months ended September 30, 2024 compared to the same period in 2023 primarily driven by an increase in domestic political advertising, partially offset by lower domestic nonpolitical and international advertising.
Advertising revenue increased for the nine months ended September 30, 2024 compared to the same period in 2023 primarily driven by an increase in domestic political advertising, increased revenue from our advanced advertising business and the positive impact of foreign currency, partially offset by lower domestic nonpolitical advertising.
Other revenue decreased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to decreases in residential wireline voice revenue driven by declines in the number of customers.
Residential Connectivity & Platforms Segment – Costs and Expenses
Programming expenses decreased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to declines in the number of domestic video subscribers, partially offset by rate increases under our domestic programming contracts.
Other expenses increased for the three months ended September 30, 2024 compared to the same period in 2023 primarily due to increased direct product costs, the impact of foreign currency, higher technical and support expenses, and increased spending on marketing and promotion, including spending associated with the Paris Olympics.
Other expenses increased for the nine months ended September 30, 2024 compared to the same period in 2023 primarily due to increased direct product costs, the impact of foreign currency and higher technical and support expenses, partially offset by decreased spending on marketing and promotion.
Business Services Connectivity Segment Results of Operations
Three Months Ended September 30,
Change
Nine Months Ended September 30,
Change
(in millions)
2024
2023
%
2024
2023
%
Revenue
$
2,425
$
2,320
4.5
%
$
7,253
$
6,894
5.2
%
Costs and expenses
1,034
985
4.9
3,117
2,906
7.2
Adjusted EBITDA
$
1,391
$
1,335
4.2
%
$
4,137
$
3,988
3.7
%
Business services connectivity revenue increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 due to increases in revenue from medium-sized and enterprise customers and from higher average rates from small business customers.
Business services connectivity costs and expenses increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to increases in direct product costs and in marketing and promotion. The increase for the nine months ended September 30, 2024 also includes an increase in technical and support expenses.
We operate our Media segment as a combined television and streaming business. We expect that the number of subscribers and audience ratings at our linear television networks will continue to decline as a result of the competitive environment and shifting video consumption patterns, which we aim to mitigate over time by continued growth in paid subscribers and advertising revenue at Peacock. We expect to continue to incur significant costs related to content and marketing at Peacock. Revenue and programming expenses are also impacted by the timing of certain sporting events, including the Olympics in the third quarter of 2024. Global economic conditions and consumer sentiment have in the past adversely impacted, and may continue to adversely impact, demand for our products and services and our results of operations.
Our Studios segment generates revenue primarily from third parties and from licensing content to our Media segment. While results of operations for our Studios segment are not impacted, results for our total Content & Experiences business may be impacted as the Studios segment licenses content to the Media segment, including for Peacock, rather than licensing the content to third parties. The Writers Guild of America and the Screen Actors Guild-American Federation of Television and Radio Artists work stoppages from May to September 2023 and July to November 2023, respectively, resulted in reduced content licensing revenue and programming and production costs at our Studios segment in the three and nine months ended September 30, 2023.
We continue to invest significantly in existing and new theme park attractions, hotels and infrastructure, including Epic Universe in Orlando, as well as in new destinations and experiences, which we believe will have a positive impact on attendance and guest spending at our theme parks.
Revenue increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to the Paris Olympics in the third quarter of 2024. Excluding incremental revenue associated with the Paris Olympics, revenue for the three months ended September 30, 2024 increased primarily due to increases in domestic distribution, international networks and other revenue. Excluding incremental revenue associated with the Paris Olympics, revenue for the nine months ended September 30, 2024 increased primarily due to increases in domestic distribution and international networks revenue, partially offset by a decrease in domestic advertising revenue.
Three Months Ended September 30,
Change
Nine Months Ended September 30,
Change
(in millions)
2024
2023
%
2024
2023
%
Total revenue
$
8,231
$
6,029
36.5
%
$
20,926
$
18,376
13.9
%
Olympics
1,906
—
NM
1,906
—
NM
Total revenue, excluding Olympics
$
6,325
$
6,029
4.9
%
$
19,020
$
18,376
3.5
%
Total domestic advertising revenue
$
3,347
$
1,913
74.9
%
$
7,363
$
5,965
23.4
%
Olympics
1,432
—
NM
1,432
—
NM
Domestic advertising revenue, excluding Olympics
$
1,915
$
1,913
0.1
%
$
5,931
$
5,965
(0.6)
%
Total domestic distribution revenue
$
3,272
$
2,591
26.3
%
$
8,942
$
7,916
13.0
%
Olympics
473
—
NM
473
—
NM
Domestic distribution revenue, excluding Olympics
$
2,798
$
2,591
8.0
%
$
8,468
$
7,916
7.0
%
Percentage changes that are considered not meaningful are denoted with NM.
Domestic advertising revenue increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to the Paris Olympics in the third quarter of 2024. Excluding the incremental revenue associated with this event, domestic advertising revenue remained consistent for the three months ended September 30, 2024 primarily due to an increase in revenue at Peacock, offset by a decrease in revenue at our linear television networks, and it decreased for the nine months ended September 30, 2024 due to a decrease in revenue at our linear television networks, partially offset by an increase in revenue at Peacock.
Domestic distribution revenue increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 and included the Paris Olympics in the third quarter of 2024. Excluding the incremental revenue associated with this event, domestic distribution revenue increased for the three and nine months ended September 30, 2024 primarily due to increases in Peacock paid subscribers, partially offset by decreases in revenue at our linear television networks. The decreases at our networks were primarily due to declines in the number of subscribers, partially offset by contractual rate increases.
International networks revenue increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to the positive impact of foreign currency and increases in revenue associated with the distribution of sports networks.
Other revenue increased for the three months ended September 30, 2024 compared to the same period in 2023 primarily due to an increase in revenue from the licensing of our owned content.
Media segment total revenue included $1.5 billion and $3.6 billion related to Peacock for the three and nine months ended September 30, 2024, respectively, including amounts related to the Paris Olympics. Media segment total revenue included $830 million and $2.3 billion related to Peacock for the three and nine months ended September 30, 2023, respectively. We had 36 million and 28 million paid subscribers of Peacock as of September 30, 2024 and 2023, respectively. Peacock paid subscribers represent customers from which Peacock receives a subscription fee on a retail or wholesale basis. Paid subscribers do not include certain customers that receive Peacock as part of bundled services where Peacock does not receive fees.
Media Segment – Costs and Expenses
Programming and production costs increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to costs associated with the Paris Olympics, higher programming costs at Peacock and increases in other sports programming costs for our domestic television networks. The increase for the nine months ended September 30, 2024 was partially offset by a decrease in entertainment content costs for our television networks.
Marketing and promotion expenses increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to increased costs associated with the Paris Olympics. The increase for the three months ended September 30, 2024 also includes increased spending on marketing at Peacock.
Other expenses increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to increases in costs related to Peacock.
* * *
Media segment total costs and expenses included $1.9 billion and $5.0 billion related to Peacock for the three and nine months ended September 30, 2024, respectively, including amounts related to the Paris Olympics. Media segment total costs and expenses included $1.4 billion and $4.3 billion related to Peacock for the three and nine months ended September 30, 2023, respectively.
Studios Segment Results of Operations
Three Months Ended September 30,
Change
Nine Months Ended September 30,
Change
(in millions)
2024
2023
%
2024
2023
%
Revenue
Content licensing
$
1,865
$
1,691
10.3
%
$
5,680
$
5,856
(3.0)
%
Theatrical
611
504
21.3
1,178
1,735
(32.1)
Other
350
324
8.2
964
970
(0.6)
Total revenue
2,826
2,518
12.3
7,822
8,561
(8.6)
Costs and Expenses
Programming and production
1,818
1,569
15.8
5,176
5,866
(11.8)
Marketing and promotion
301
314
(4.3)
1,126
1,155
(2.5)
Other
240
205
16.8
685
579
18.3
Total costs and expenses
2,359
2,089
12.9
6,987
7,600
(8.1)
Adjusted EBITDA
$
468
$
429
9.0
%
$
835
$
961
(13.1)
%
Studios Segment – Revenue
Content licensing revenue increased for the three months ended September 30, 2024 compared to the same period in 2023 primarily due to the timing of when content was made available by our television studios under licensing agreements, including the impact of the work stoppages in the prior year period.
Content licensing revenue decreased for the nine months ended September 30, 2024 compared to the same period in 2023 primarily due to the timing of when content was made available by our film studios, partially offset by the timing of when content was made available by our television studios under licensing agreements, including the impact of the work stoppages in the prior year period.
Theatrical revenue increased for the three months ended September 30, 2024 compared to the same period in 2023 primarily due to higher revenue from recent releases, including Despicable Me 4 and Twisters.
Theatrical revenue decreased for the nine months ended September 30, 2024 compared to the same period in 2023 primarily due to higher revenue from releases in the prior year period, including The Super Mario Bros., Oppenheimer and Fast X, compared to revenue from recent releases, including Despicable Me 4, Kung Fu Panda 4 and Twisters.
Programming and production costs increased for the three months ended September 30, 2024 compared to the same period in 2023 primarily due to higher costs associated with content licensing sales, including the impact of work stoppages in the prior year period.
Programming and production costs decreased for the nine months ended September 30, 2024 compared to the same period in 2023 primarily due to lower costs associated with theatrical releases, partially offset by higher costs associated with content licensing sales, including the impact of work stoppages in the prior year period.
Marketing and promotion expenses decreased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to decreased spending on recent and upcoming theatrical film releases in the current year periods.
Theme Parks Segment Results of Operations
Three Months Ended September 30,
Change
Nine Months Ended September 30,
Change
(in millions)
2024
2023
%
2024
2023
%
Revenue
$
2,289
$
2,418
(5.3)
%
$
6,243
$
6,576
(5.1)
%
Costs and expenses
1,442
1,435
0.5
4,132
4,103
0.7
Adjusted EBITDA
$
847
$
983
(13.8)
%
$
2,111
$
2,473
(14.6)
%
Theme parks segment revenue decreased for thethree and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to decreases at our domestic theme parks driven by decreased park attendance. The decrease for the nine months ended September 30, 2024 also includes the negative impact of foreign currency at our international theme parks.
Theme parks segment costs and expenses were consistent for the three and nine months endedSeptember 30, 2024 compared to the same periods in 2023. Theme parks segment costs and expenses were consistent for the nine months ended September 30, 2024 primarily due to higher costs associated with park operations, offset by the impact of foreign currency.
Content & Experiences Headquarters, Other and Eliminations
Headquarters and Other Results of Operations
Three Months Ended September 30,
Change
Nine Months Ended September 30,
Change
(in millions)
2024
2023
%
2024
2023
%
Revenue
$
11
$
13
(16.8)
%
$
32
$
45
(27.1)
%
Costs and expenses
211
191
10.6
675
654
3.1
Adjusted EBITDA
$
(200)
$
(178)
(12.6)
%
$
(642)
$
(610)
(5.3)
%
Headquarters and Other expenses include overhead, personnel costs and costs associated with corporate initiatives.
Eliminations
Three Months Ended September 30,
Change
Nine Months Ended September 30,
Change
(in millions)
2024
2023
%
2024
2023
%
Revenue
$
(758)
$
(419)
80.7
%
$
(1,994)
$
(1,867)
6.8
%
Costs and expenses
(796)
(436)
82.4
(2,101)
(1,965)
7.0
Adjusted EBITDA
$
38
$
17
(125.6)
%
$
108
$
97
(10.7)
%
Amounts represent eliminations of transactions between segments in our Content & Experiences business, the most significant being content licensing between the Studios and Media segments, which are affected by the timing of recognition of content licenses.
Eliminations increase or decrease to the extent that additional content is made available to our other segments within the Content & Experiences business. Refer to Note 2 for additional information on transactions between our segments.
Corporate and Other primarily includes overhead and personnel costs; Sky branded video services and television networks in Germany; Comcast Spectacor, which owns the Philadelphia Flyers and the Wells Fargo Center arena in Philadelphia, Pennsylvania; and Xumo, our consolidated streaming platform joint venture.
Corporate and Other revenue increased for the three months ended September 30, 2024 compared to the same period in 2023 driven by Spectacor and Xumo. Corporate and other revenue increased for the nine months ended September 30, 2024 compared to the same period in 2023 driven by an increase across our businesses.
Corporate and Other costs and expenses increased for the three months ended September 30, 2024 compared to the same period in 2023 due to increased marketing associated with the Paris Olympics and increases related to Spectacor and Xumo. Corporate and Other costs and expenses increased for the nine months ended September 30, 2024 compared to the same period in 2023 primarily due to increases related to corporate functions, increased marketing associated with the Paris Olympics, and Xumo.
Eliminations
Three Months Ended September 30,
Change
Nine Months Ended September 30,
Change
(in millions)
2024
2023
%
2024
2023
%
Revenue
$
(1,495)
$
(1,358)
10.1
%
$
(4,174)
$
(4,157)
0.4
%
Costs and expenses
(1,436)
(1,375)
4.5
(4,088)
(4,191)
(2.5)
Adjusted EBITDA
$
(59)
$
16
NM
$
(86)
$
34
NM
Percentage changes that are considered not meaningful are denoted with NM.
Amounts represent eliminations of transactions between our Connectivity & Platforms, Content & Experiences and other businesses, the most significant being distribution of television network programming between the Media and Residential Connectivity & Platforms segments. Current year amounts reflect an increase associated with the Paris Olympics. Eliminations of transactions between segments within Content & Experiences are presented separately. Refer to Note 2 for additional information on transactions between our segments.
Non-GAAP Financial Measures
Consolidated Adjusted EBITDA
Adjusted EBITDA is a non-GAAP financial measure and is the primary basis used to measure the operational strength and performance of our businesses as well as to assist in the evaluation of underlying trends in our businesses. This measure eliminates the significant level of noncash depreciation and amortization expense that results from the capital-intensive nature of certain of our businesses and from intangible assets recognized in business combinations. It is also unaffected by our capital and tax structures, and by our investment activities, including the results of entities that we do not consolidate, as our management excludes these results when evaluating our operating performance. Our management and Board of Directors use this financial measure to evaluate our consolidated operating performance and the operating performance of our operating segments and to allocate resources and capital to our operating segments. It is also a significant performance measure in our annual incentive compensation programs. Additionally, we believe that Adjusted EBITDA is useful to investors because it is one of the bases for comparing our operating performance with that of other companies in our industries, although our measure of Adjusted EBITDA may not be directly comparable to similar measures used by other companies.
We define Adjusted EBITDA as net income attributable to Comcast Corporation before net income (loss) attributable to noncontrolling interests, 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.
We reconcile consolidated Adjusted EBITDA to net income attributable to Comcast Corporation. This measure should not be considered a substitute for operating income (loss), net income (loss), net income (loss) attributable to Comcast Corporation, or net cash provided by operating activities that we have reported in accordance with GAAP.
Reconciliation from Net Income Attributable to Comcast Corporation to Adjusted EBITDA
Three Months Ended September 30,
Nine Months Ended September 30,
(in millions)
2024
2023
2024
2023
Net income attributable to Comcast Corporation
$
3,629
$
4,046
$
11,415
$
12,128
Net income (loss) attributable to noncontrolling interests
(53)
(49)
(222)
(175)
Income tax expense
1,243
1,468
3,906
4,481
Interest expense
1,037
1,060
3,065
3,068
Investment and other (income) loss, net
3
(50)
140
(672)
Depreciation
2,219
2,203
6,548
6,662
Amortization
1,659
1,290
4,421
4,146
Adjustments(a)
(2)
(6)
(11)
(16)
Adjusted EBITDA
$
9,735
$
9,962
$
29,261
$
29,621
(a)Amounts represent the impact of certain events, gains, losses or other charges that are excluded from Adjusted EBITDA, including costs related to our investment portfolio.
Constant Currency
Constant currency and constant currency growth rates are non-GAAP financial measures that present our results of operations excluding the estimated effects of foreign currency exchange rate fluctuations. Certain of our businesses, including Connectivity & Platforms, have operations outside the United States that are conducted in local currencies. As a result, the comparability of the financial results reported in U.S. dollars is affected by changes in foreign currency exchange rates. In our Connectivity & Platforms business, we use constant currency and constant currency growth rates to evaluate the underlying performance of the businesses, and we believe they are helpful for investors because such measures present operating results on a comparable basis year over year to allow the evaluation of their underlying performance.
Constant currency and constant currency growth rates are calculated by comparing the results for each comparable prior year period adjusted to reflect the average exchange rates from each current year period presented rather than the actual exchange rates that were in effect during the respective periods.
Reconciliation of Residential Connectivity & Platforms Constant Currency
Three Months Ended September 30, 2023
Nine Months Ended September 30, 2023
(in millions)
As Reported
Effects of Foreign Currency
Constant Currency Amounts
As Reported
Effects of Foreign Currency
Constant Currency Amounts
Revenue
Domestic broadband
$
6,366
$
—
$
6,366
$
19,086
$
—
$
19,086
Domestic wireless
917
—
917
2,644
—
2,644
International connectivity
1,109
31
1,141
3,009
77
3,086
Total residential connectivity
8,393
31
8,424
24,739
77
24,816
Video
7,154
47
7,201
21,895
124
22,018
Advertising
960
11
971
2,860
25
2,885
Other
1,444
10
1,454
4,394
28
4,422
Total revenue
17,951
99
18,050
53,888
253
54,141
Costs and Expenses
Programming
4,460
28
4,488
13,638
74
13,712
Other
6,605
55
6,659
19,578
140
19,718
Total costs and expenses
11,065
83
11,148
33,216
214
33,430
Adjusted EBITDA
$
6,886
$
16
$
6,902
$
20,672
$
39
$
20,711
Other Adjustments
From time to time, we present adjusted information, such as revenue, to exclude the impact of certain events, gains, losses or other charges. This adjusted information is a non-GAAP financial measure. We believe, among other things, that the adjusted information may help investors evaluate our ongoing operations and can assist in making meaningful period-over-period comparisons.
Liquidity and Capital Resources
Nine Months Ended September 30,
(in billions)
2024
2023
Cash provided by operating activities
$
19.6
$
22.6
Cash used in investing activities
$
(10.6)
$
(11.7)
Cash used in financing activities
$
(6.5)
$
(9.1)
(in billions)
September 30, 2024
December 31, 2023
Cash and cash equivalents
$
8.8
$
6.2
Debt
$
101.4
$
97.1
Our businesses generate significant cash flows from operating activities. We believe that we will be able to continue to meet our current and long-term liquidity and capital requirements, including fixed charges, through our cash flows from operating activities; existing cash, cash equivalents and investments; available borrowings under our existing credit facility; and our ability to obtain future external financing. We anticipate that we will continue to use a substantial portion of our cash flows from operating activities in repaying our debt obligations, funding our capital expenditures and cash paid for intangible assets, investing in business opportunities, and returning capital to shareholders.
We maintain significant availability under our revolving credit facility and our commercial paper program to meet our short-term liquidity requirements. Our commercial paper program generally provides a lower-cost source of borrowing to fund our short-term working capital requirements. As of September 30, 2024, amounts available under our revolving credit facility, net of amounts outstanding under our commercial paper program and outstanding letters of credit and bank guarantees, totaled $11.8 billion.
We entered into a new revolving credit facility in May 2024 (see Note 5). Our new revolving credit facility contains a financial covenant pertaining to leverage, which is the ratio of debt to EBITDA, as defined in the agreement. Compliance with this financial covenant is tested on a quarterly basis. As of September 30, 2024, we met this financial covenant, and we expect to remain in compliance with this financial covenant.
Components of Net Cash Provided by Operating Activities
Nine Months Ended September 30,
(in millions)
2024
2023
Operating income
$
18,304
$
18,830
Depreciation and amortization
10,969
10,807
Noncash share-based compensation
983
955
Changes in operating assets and liabilities
(2,652)
(2,030)
Payments of interest
(2,503)
(2,566)
Payments of income taxes
(5,988)
(3,823)
Proceeds from investments and other
480
406
Net cash provided by operating activities
$
19,593
$
22,579
The variance in changes in operating assets and liabilities for the nine months ended September 30, 2024 compared to the same period in 2023 was primarily related to increases in receivables and decreases in deferred revenue, which includes the impact of the Paris Olympics, the timing of amortization and related payments for our film and television costs, including decreased spending in the prior year period due to the work stoppages and the timing of sports, and decreases in inventory.
The decrease in payments of interest for the nine months ended September 30, 2024 compared to the same period in 2023 was primarily due to the payments of interest in the prior year period associated with our collateralized obligation which was repaid in the fourth quarter of 2023, partially offset by increased debt balances following debt issuances in the current year period and higher weighted-average interest rates.
Payments of income taxes increased for the nine months ended September 30, 2024 compared to the same period in 2023 and included higher payments in the current year period related to the preceding tax year, primarily driven by the sale of our investment in Hulu. Payments were also impacted by the timing of transferable tax credit purchases.
In July 2024, we entered into new rights agreements with the NBA and WNBA for television and streaming rights for certain regular and post-season games beginning with the 2025-26 season through the 2035-36 season with aggregate rights payments of $27 billion.
Investing Activities
Net cash used in investing activities decreased for the nine months ended September 30, 2024 compared to the same period in 2023 primarily due to decreased capital expenditures, decreased cash paid for intangible assets related to software development and increased proceeds from the maturity of short-term investments in the current year period. Capital expenditures decreased for the nine months ended September 30, 2024 compared to the same period in 2023 primarily reflecting decreased spending by the Connectivity & Platforms businesses driven by customer premise equipment and scalable infrastructure, partially offset by increased spending on line extensions; as well capital expenditures in the prior year period associated with the acquisition of land for potential theme park expansion opportunities. These decreases were partially offset by increased spending on theme park attractions.
In the fourth quarter of 2023, we exercised our put right requiring Disney to purchase our interest in Hulu and received $8.6 billion, representing $9.2 billion for our share of Hulu’s minimum equity value presented as an advance on the sale of our investment in our condensed consolidated balance sheet, less $557 million for our share of prior capital calls. We expect to receive additional proceeds for the sale of our interest in Hulu following the final determination of Hulu’s fair value pursuant to a third-party appraisal process, at which time we will recognize the sale of our interest.
Financing Activities
Net cash used in financing activities decreased for the nine months ended September 30, 2024 compared to the same period in 2023 primarily due to decreases in repurchases of common stock in the current year period, repayments of short-term borrowings in the prior year period, higher repurchases and repayments of debt in the prior year period and higher proceeds from borrowings in the current year period.
In September 2024, we issued €1.8 billion aggregate principal amount of fixed-rate euro senior notes maturing in 2032 and 2036 and entered into a corresponding cross-currency swap, effectively converting the debt to an aggregate U.S. dollar principal amount of $2.0 billion with a weighted-average interest rate of 4.72%. We also issued £750 million ($1.0 billion using exchange rates on the date of issuance) principal amount of fixed rate sterling senior notes maturing in 2040 with an interest rate of 5.25%. The net proceeds from this issuance are intended for working capital and general corporate purposes, including the early redemption of $725 million of our outstanding 5.25% Notes due 2025, which was completed in October 2024, and the repayment of certain of our other outstanding debt with near-term maturities. In May 2024, we issued $3.3 billion aggregate principal amount of fixed-rate senior notes, which have maturities ranging between 2029 and 2054 and a weighted-average interest rate of 5.38%. The net proceeds from this issuance was for the repayment of our outstanding commercial paper, and for working capital and general corporate purposes.
For the nine months ended September 30, 2024, we made debt repayments of $2.4 billion, including $1.9 billion principal amount of notes due at maturity and $216 million of 3.950% Notes due 2025, $149 million of 3.375% Notes due 2025 and $25 million of 5.250% Notes due 2025.
We have made, and may from time to time in the future make, optional repayments on our debt obligations, which may include repurchases or exchanges of our outstanding public notes and debentures, depending on various factors, such as market conditions. Any such repurchases may be effected through privately negotiated transactions, market transactions, tender offers, redemptions or otherwise. In particular, we may repurchase varying amounts of our outstanding public notes and debentures with short to medium term maturities through privately negotiated or market transactions. See Notes 5 and 7 for additional information on our financing activities.
Share Repurchases and Dividends
During the nine months ended September 30, 2024, we repurchased a total of 162 million shares of our Class A common stock for $6.6 billion. In January 2024, our Board of Directors terminated the existing share repurchase program authorization and approved a new share repurchase program authorization of $15.0 billion, which has no expiration date. As of September 30, 2024, we had $9.0 billion remaining under the authorization. We expect to repurchase additional shares of our Class A common stock under this new authorization in the open market or in private transactions, subject to market and other conditions.
In addition, we paid $328 million for the nine months ended September 30, 2024 related to employee taxes associated with the administration of our share-based compensation plans.
In January 2024, our Board of Directors approved a 6.9% increase in our dividend to $1.24 per share on an annualized basis. During the nine months ended September 30, 2024, we paid dividends of $3.6 billion. In July 2024, our Board of Directors approved our third quarter dividend of $0.31 per share, which was paid in October 2024. We expect to continue to pay quarterly dividends, although each dividend is subject to approval by our Board of Directors.
Guarantee Structure
Our debt is primarily issued at Comcast, although we also have debt at certain of our subsidiaries as a result of acquisitions and other issuances. A substantial amount of this debt is subject to guarantees by Comcast and by certain subsidiaries that we have put in place to simplify our capital structure. We believe this guarantee structure provides liquidity benefits to debt investors and helps to simplify credit analysis with respect to relative value considerations of guaranteed subsidiary debt.
Debt issuance costs, premiums, discounts, fair value adjustments for acquisition accounting and hedged positions, net
(6.0)
(6.1)
Total debt
$
101.4
$
97.1
(a)NBCUniversal Media, LLC (“NBCUniversal”), Comcast Cable Communications, LLC (“Comcast Cable”) and Comcast Holdings Corporation (“Comcast Holdings”), which is included within other debt subject to one-way guarantees, are each consolidated subsidiaries subject to the periodic reporting requirements of the SEC. The guarantee structures and related disclosures in this section, together with Exhibit 22 to our Annual Report on Form 10-K, satisfy these reporting obligations.
(b)Universal Beijing Resort debt financing is secured by the assets of Universal Beijing Resort and the equity interests of the investors. See Note 6 for additional information.
Cross-Guarantees
Comcast, NBCUniversal and Comcast Cable (the “Guarantors”) fully and unconditionally, jointly and severally, guarantee each other’s debt securities. NBCUniversal and Comcast Cable also guarantee other borrowings of Comcast, including its revolving credit facility. These guarantees rank equally with all other general unsecured and unsubordinated obligations of the respective Guarantors. However, the obligations of the Guarantors under the guarantees are structurally subordinated to the indebtedness and other liabilities of their respective non-guarantor subsidiaries. The obligations of each Guarantor are limited to the maximum amount that would not render such Guarantor’s obligations subject to avoidance under applicable fraudulent conveyance provisions of U.S. and non-U.S. law. Each Guarantor’s obligations will remain in effect until all amounts payable with respect to the guaranteed securities have been paid in full. However, a guarantee by NBCUniversal or Comcast Cable of Comcast’s debt securities, or by NBCUniversal of Comcast Cable’s debt securities, will terminate upon a disposition of such Guarantor entity or all or substantially all of its assets.
The Guarantors are each holding companies that principally hold investments in, borrow from and lend to non-guarantor subsidiary operating companies; issue and service third-party debt obligations; repurchase shares and pay dividends; and engage in certain corporate and headquarters activities. The Guarantors are generally dependent on non-guarantor subsidiary operating companies to fund these activities.
As of September 30, 2024 and December 31, 2023, the combined Guarantors have noncurrent notes payable to non-guarantor subsidiaries of $81 billion and $136 billion, respectively, and noncurrent notes receivable from non-guarantor subsidiaries of $19 billion and $18 billion, respectively. This financial information is that of the Guarantors presented on a combined basis with intercompany balances between the Guarantors eliminated. The combined financial information excludes financial information of non-guarantor subsidiaries. The underlying net assets of the non-guarantor subsidiaries are significantly in excess of the Guarantor obligations. Excluding investments in non-guarantor subsidiaries, external debt and the noncurrent notes payable and receivable with non-guarantor subsidiaries, the Guarantors do not have material assets, liabilities or results of operations.
One-Way Guarantees
Comcast provides full and unconditional guarantees of certain debt issued by Sky Limited (“Sky”), including all of its senior notes, and other consolidated subsidiaries not subject to the periodic reporting requirements of the SEC.
Comcast also provides a full and unconditional guarantee of $138 million principal amount of subordinated debt issued by Comcast Holdings. Comcast’s obligations under this guarantee are subordinated and subject, in right of payment, to the prior payment in full of all of Comcast’s senior indebtedness, including debt guaranteed by Comcast on a senior basis, and are structurally subordinated to the indebtedness and other liabilities of its non-guarantor subsidiaries (for purposes of this Comcast Holdings discussion, Comcast Cable and NBCUniversal are included within the non-guarantor subsidiary group). Comcast’s obligations as guarantor will remain in effect until all amounts payable with respect to the guaranteed debt have been paid in full. However, the guarantee will terminate upon a disposition of Comcast Holdings or all or substantially all of its assets. Comcast Holdings is a consolidated subsidiary holding company that directly or indirectly holds 100% and approximately 37% of our equity interests in Comcast Cable and NBCUniversal, respectively.
As of September 30, 2024 and December 31, 2023, Comcast and Comcast Holdings, the combined issuer and guarantor of the guaranteed subordinated debt, have noncurrent senior notes payable to non-guarantor subsidiaries of $47 billion and $104 billion, respectively, and noncurrent notes receivable from non-guarantor subsidiaries of $15 billion and $14 billion, respectively. This financial information is that of Comcast and Comcast Holdings presented on a combined basis with intercompany balances between Comcast and Comcast Holdings eliminated. The combined financial information excludes financial information of non-guarantor subsidiaries of Comcast and Comcast Holdings. The underlying net assets of the non-guarantor subsidiaries of Comcast and Comcast Holdings are significantly in excess of the obligations of Comcast and Comcast Holdings. Excluding investments in non-guarantor subsidiaries, external debt, and the noncurrent notes payable and receivable with non-guarantor subsidiaries, Comcast and Comcast Holdings do not have material assets, liabilities or results of operations.
Critical Accounting Estimates
The preparation of our condensed consolidated financial statements requires us to make estimates that affect the reported amounts of assets, liabilities, revenue and expenses, and the related disclosure of contingent assets and contingent liabilities. We base our judgments on our historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making estimates about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
We believe our estimates associated with the valuation and impairment testing of goodwill are critical in the preparation of our consolidated financial statements. We performed a quantitative assessment as of July 1, 2024 for goodwill in our Media segment. Based on this assessment, the estimated fair value of the Media reporting unit substantially exceeded its carrying value and no impairment was required.
Changes in market conditions, laws and regulations, and key assumptions made in future quantitative assessments, including expected cash flows, competitive factors and discount rates, could negatively impact the results of future impairment testing and could result in the recognition of an impairment charge.
For a more complete discussion of the accounting estimates that we have identified as critical in the preparation of our condensed consolidated financial statements, please refer to our Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2023 Annual Report on Form 10-K.
ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We have evaluated the information required under this item that was disclosed in our 2023 Annual Report on Form 10-K and there have been no material changes to this information.
ITEM 4: CONTROLS AND PROCEDURES
Conclusions regarding disclosure controls and procedures
Our principal executive and principal financial officers, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this report, have concluded that, based on the evaluation of these controls and procedures required by paragraph (b) of Exchange Act Rules 13a-15 or 15d-15, such disclosure controls and procedures were effective.
Changes in internal control over financial reporting
There were no changes in internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
See Note 9 included in this Quarterly Report on Form 10-Q for a discussion of legal proceedings.
ITEM 1A: RISK FACTORS
There have been no material changes from the risk factors previously disclosed in Item 1A of our 2023 Annual Report on Form 10-K.
ITEM 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
The table below summarizes Comcast’s common stock repurchases during the three months ended September 30, 2024.
Period
Total Number of Shares Purchased
Average Price Per Share
Total Number of Shares Purchased as Part of Publicly Announced Authorization
Total Dollar Amount Purchased Under the Publicly Announced Authorization
Maximum Dollar Value of Shares That May Yet Be Purchased Under the Publicly Announced Authorization(a)
July 1-31, 2024
17,765,351
$
38.77
17,765,351
$
688,839,057
$
10,283,114,218
August 1-31, 2024
13,503,765
$
39.62
13,503,765
$
534,976,025
$
9,748,138,194
September 1-30, 2024
18,644,155
$
39.96
18,644,155
$
744,976,969
$
9,003,161,225
Total
49,913,271
$
39.44
49,913,271
$
1,968,792,051
$
9,003,161,225
(a)In September 2022, our Board of Directors approved a share repurchase program authorization of $20.0 billion. In January 2024, our Board of Directors terminated the existing program and approved a new share repurchase authorization of $15.0 billion, which has no expiration date. We expect to repurchase additional shares of our Class A common stock under this authorization, in the open market or in private transactions, subject to market and other conditions.
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101
The following financial statements from Comcast Corporation’s Quarterly Report on Form 10-Q for the nine months ended September 30, 2024, filed with the Securities and Exchange Commission on October 31, 2024, formatted in Inline Extensible Business Reporting Language (iXBRL): (i) the Condensed Consolidated Statements of Income; (ii) the Condensed Consolidated Statements of Comprehensive Income; (iii) the Condensed Consolidated Statements of Cash Flows; (iv) the Condensed Consolidated Balance Sheets; (v) the Condensed Consolidated Statements of Changes in Equity; and (vi) the Notes to Condensed Consolidated Financial Statements.
104
Cover Page Interactive Data File (embedded within the iXBRL document).
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
COMCAST CORPORATION
By:
/s/ DANIEL C. MURDOCK
Daniel C. Murdock
Executive Vice President, Chief Accounting Officer and Controller
