Comcast is weighing a potential spin-off of its cable brands to adeptly adapt to the ongoing cord-cutting trends while announcing impressive results for the third quarter. President Michael Cavanagh indicated during a recent conference call that the company will embark on a study to assess the feasibility of creating a "new, well-capitalized company owned by our shareholders and comprised of our strong portfolio of cable networks." Notably, any such separation would leave out the Peacock streaming service and broadcast operations. Additionally, Cavanagh stated, "Like many of our peers in media, we are experiencing the effects of the transition in our video businesses and have been studying the best path forward for these assets." Through this review, the company aims to determine whether a spin-off would allow it to seize opportunities within the rapidly evolving media landscape.
Following this announcement, shares of Comcast climbed by 3% in afternoon trading. Reflecting on the broader media landscape, Cavanagh also mentioned, "We chose not to participate in the M&A process around Paramount in the earlier part of this year, but we would consider partnerships in streaming despite their complexities." In the recently concluded third quarter, Comcast reported impressive revenue of $32.07 billion — an increase from $30.12 billion in the same period last year, exceeding the average analyst estimate of $31.71 billion.
Adjusted earnings per share also slightly rose to $1.12 from $1.08, defying analysts' expectations for a decrease to $1.06. Total media revenue soared nearly 37% to $8.23 billion, primarily driven by heightened domestic advertising and distribution revenue linked to the Paris Olympics. Excluding the Olympics, media revenue experienced a more modest rise of 4.9%.
The boost related to the Olympics and stronger sales from Peacock was somewhat countered by lower revenue at other networks, according to the company's report. Current Price: 43.47, Change: +1.23, Percent Change: +2.90.