CMCSA — Q3 2026 Financial Report Analysis

Comcast's reported third-quarter 2026 revenue fell 6.1% to $29.30 billion, yet net income attributable to Comcast rose 3.5% to $3.45 billion and diluted earnings per share (EPS) rose 7.2% to $0.97. The two numbers point in opposite directions because the company is smaller than it was a year ago: it spun off its cable-network group Versant on 2 January 2026 and sold Sky's German operations on 31 May 2026. On Comcast's own pro forma basis, which restates the year-ago quarter as if both businesses were already gone, revenue rose 0.5% and Adjusted EBITDA rose 0.8%. The underlying picture is a split company: the broadband-and-cable side earned less (Adjusted EBITDA −4.4%), while the content side earned much more (+29.3%), led by a $478 million year-over-year swing at Peacock.

Operating margin is the share of revenue left after all operating costs, including depreciation, but before interest and tax. Adjusted EBITDA is Comcast's own profit measure: earnings before interest, tax, depreciation and amortization, and before certain one-off items. Free cash flow is the cash from operations left after capital spending.

Takeaway: The GAAP EPS gain of 7.2% did not come from the business. Pre-tax income was essentially flat (−0.5%), and EPS rose because the tax rate fell to 24.4% from 27.3% and the share count was 3.4% lower than a year ago from buybacks made before they were paused. Comcast's own adjusted EPS, which strips out acquisition amortization and investment gains, fell 4.0%. The real story of the quarter is a trade-off between two halves: Media (mostly Peacock) and the film studio added $585 million of Adjusted EBITDA, while residential connectivity and Theme Parks gave back $534 million.

Connectivity & Platforms: losses slowing in dollars, not in customers

Connectivity & Platforms (Xfinity, Sky's remaining pay-TV and broadband, and Comcast Business) is still about two-thirds of revenue: $19.66 billion, down 2.7%, with Adjusted EBITDA down 4.4% to $7.59 billion and margin down 70 basis points (0.7 percentage points) to 38.6%.

Residential revenue fell 3.5% to $17.02 billion and Adjusted EBITDA fell 5.8% to $6.11 billion (margin 35.9%, down from 36.8%). The revenue lines show where the money moved:

The company again explains the broadband decline as "lower average rates and a decline in the number of domestic broadband customers". Price comes first in that sentence and in the numbers: the customer base is 1.9% smaller, but broadband revenue is down 4.7%, so each remaining customer is paying less on average. That is the cost of Comcast's new pricing approach, which bundles mobile lines (often free at first) with home internet to keep customers from switching.

Wireless is doing its job as an offset. Wireless service revenue grew $135 million, set against a $309 million broadband decline, so mobile is now replacing about 44% of what broadband loses, up from about a third in Q2. Comcast says the growth reflects "the conversion of promotional free lines to paid service". Combined "convergence" revenue fell 2.3%, an improvement on Q2's 3.2% decline. Two cautions: line additions slowed to 368,000 from 448,000 in Q2 and 414,000 a year earlier, and the $144 million jump in phone sales (wireless equipment) carries little profit. Non-programming costs rose 1.2%, which the company attributes mainly to higher "direct product costs" from the wireless business.

Video (pay-TV) remains in structural decline: 274,000 customers lost in the quarter and revenue down 8.7%. Programming costs fell 8.3% alongside it, which cushions the profit impact.

Business Services Connectivity grew revenue 2.7% to $2.65 billion and Adjusted EBITDA 1.7% to $1.48 billion, on enterprise solutions. Margin slipped 50 basis points to 55.9% as direct product and marketing costs rose 4.0%. Growth here was slower than in Q2 (+3.7% revenue, +5.0% EBITDA).

Content & Experiences: Peacock and movies up, parks down

Content & Experiences revenue rose 6.5% to $10.54 billion and Adjusted EBITDA rose 29.3% to $1.80 billion.

• Media: revenue +13.0% to $5.36 billion, or +8.3% excluding $224 million of FIFA World Cup revenue. Domestic distribution revenue (fees paid by pay-TV providers and Peacock subscribers) rose 22.4% to $2.07 billion, which Comcast attributes to Peacock's "higher average rates and an increase in paid subscribers." Excluding the World Cup, domestic advertising was flat (+0.3%): Peacock's ad growth was cancelled out by lower ad revenue at the traditional networks. Media Adjusted EBITDA more than tripled to $769 million from $247 million.
• Peacock (inside Media): $1.8 billion revenue vs $1.4 billion, Adjusted EBITDA +$261 million vs −$217 million. Paid subscribers were 48 million, up 17% from a year ago but level with the 48 million reported at the end of Q2, so this quarter's revenue growth came from price and advertising rather than new sign-ups. Media's operating expenses rose only 2.1%: other Peacock costs went up, but the company says programming costs at Peacock and the international networks went down.
• Studios: revenue −1.1% to $2.97 billion, but Adjusted EBITDA +18.6% to $402 million. Theatrical revenue rose 76.6% to $1.13 billion on The Odyssey (nearly $1.8 billion worldwide box office year to date, Universal's highest-grossing film ever) and Minions & Monsters. Content licensing fell 23.7% to $1.55 billion on the timing of TV studio deliveries. Lower marketing spend between releases helped too, and that is a timing effect.
• Theme Parks: revenue −4.4% to $2.60 billion and Adjusted EBITDA −17.1% to $780 million, a margin of 30.0% vs 34.6% a year ago. Revenue fell on "lower revenue from park admissions, including from the impact of increased promotional activity," while total operating costs rose 2.3%, driven by the domestic parks. This is worse than Q2's 5.1% EBITDA decline. The year-ago quarter was the first summer of Epic Universe in Orlando (opened May 2025), a demanding comparison, but discounting that still cuts profit points to soft demand rather than only a tough base.

What the headline numbers hide

• Lower tax and fewer shares drove EPS, not operations. Income before taxes was $4.45 billion vs $4.47 billion (−0.5%). The effective tax rate fell to 24.4% from 27.3%, which is how net income rose 3.5%. Diluted shares fell to 3,562 million from 3,689 million (−3.4%), which took EPS growth from 3.5% to 7.2%. The buyback was suspended at the start of Q3, so that share-count tailwind will fade over the coming quarters.
• Below the operating line, two items helped. Interest expense fell to $962 million from $1,128 million as total debt dropped to $87.4 billion from $98.9 billion at year-end (year-to-date debt repayments of $10.4 billion against $2.0 billion of new borrowing). Equity-method investees swung to a $129 million gain from a $90 million loss. Comcast excludes most of that swing from adjusted earnings.
• The GAAP vs adjusted gap runs the "wrong" way this quarter. Adjusted EPS ($1.07) is above GAAP EPS ($0.97), mainly because adjusted figures add back $402 million after tax of amortization on acquired intangibles and $46 million of share-based compensation. They subtract $95 million of investment gains. Acquisition amortization fell to $524 million pre-tax from $824 million, so on that measure, too, GAAP growth looks better than adjusted.
• Cash conversion is healthy but down. Operating cash flow was $7.90 billion against net income of $3.36 billion. That is normal for a capital-heavy business with $3.7 billion of quarterly depreciation and amortization. Still, operating cash flow fell 9.1% and free cash flow fell 14.8% to $4.21 billion, with capital spending flat at $3.06 billion. Year to date, receivables consumed $1.0 billion of cash vs releasing $716 million a year earlier. Free cash flow covered the $1.2 billion dividend about 3.5 times.
• One-offs are small in Q3. Separation-related costs were $26 million pre-tax (vs $116 million a year ago, which was Versant). The large year-to-date distortions sit in the prior year: a $9.4 billion Hulu sale gain in 2025 is why nine-month EPS fell 46.5% to $2.55.

Did last time's read hold up?

Our Q2 2026 analysis said to watch domestic broadband revenue rather than subscriber counts, and to use Q3 to test whether Peacock's profit was structural or seasonal. On broadband, it was a partial yes: revenue still fell (−4.7%) and price is still the lead cause, but the decline narrowed from −5.5%. The subscriber picture reversed from Q2's modest improvement to worse-than-last-year losses (144,000 vs 91,000). On Peacock, it held up better than we suggested: it stayed profitable at $261 million without the NBA playoffs, although the quarter still carried part of the World Cup, so the cleanest test moves to Q4. We also flagged Theme Parks as the clearest negative, and it got worse.

Forward read

The earnings release contains no numeric financial guidance. What management has said: the separation of NBCUniversal and Sky into an independent company "remains on track"; the share buyback stays suspended through that separation; the residential results "reflect the investments we're making" in the new pricing strategy; and Theme Parks faces "near-term cyclical headwinds," which management says do not change its long-term view.

Our read: the connectivity business is no longer deteriorating faster each quarter. The broadband revenue decline, residential EBITDA decline (−5.8% vs −8.0% in Q2) and convergence revenue decline all narrowed. But slower wireless additions and worse broadband customer losses mean the improvement is coming from price stabilising and free lines converting to paid, not from winning customers back. That source of improvement has a limit once the promotional free lines have been converted. On the content side, Q4 has no World Cup but does include the start of the NBA regular season and its rights costs, so Peacock's profit margin, around 14.5% this quarter, is the figure to watch. With the buyback paused and the tax rate unusually low this quarter, EPS no longer has the help it got from those two in Q3. From here, per-share growth has to come from operating profit, which on a pro forma basis grew just 0.8% this quarter.

Source: Comcast Q3 2026 earnings release (Form 8-K, Exhibit 99.1, filed 22 October 2026). The full 10-Q was not yet filed at the time of writing, so management's detailed discussion and analysis (MD&A) beyond the release is not reflected.