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COMCAST CORP - Quarter Report: 2017 June (Form 10-Q)

Table of Contents
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
x
Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended June 30, 2017
OR
c
Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the Transition Period from                      to                      
 
comcastmcolorblk165a03.jpg
 
Commission File Number
Exact Name of Registrant; State of
Incorporation; Address and Telephone
Number of Principal Executive Offices
I.R.S. Employer Identification No.
001-32871
COMCAST CORPORATION
27-0000798
 
PENNSYLVANIA
One Comcast Center
Philadelphia, PA 19103-2838
(215) 286-1700
 
 
 
 
001-36438
NBCUNIVERSAL MEDIA, LLC
14-1682529
 
DELAWARE
30 Rockefeller Plaza
New York, NY 10112-0015
(212) 664-4444
 
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
 
Comcast Corporation
 
Yes
x
 
No
c
 
 
NBCUniversal Media, LLC
 
Yes
x
 
No
c
 
 
 
 
 
 
 
 
 
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such period that the registrant was required to submit and post such files).
 
Comcast Corporation
 
Yes
x
 
No
c
 
 
NBCUniversal Media, LLC
 
Yes
x
 
No
c
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Comcast Corporation
Large accelerated filer
x
Accelerated filer
c
Non-accelerated filer
c
Smaller reporting company
c
Emerging growth company
c
NBCUniversal Media, LLC
Large accelerated filer
c
Accelerated filer
c
Non-accelerated filer
x
Smaller reporting company
c
Emerging growth company
c
If an emerging growth company, indicate by check mark whether the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Comcast Corporation
c
NBCUniversal Media, LLC
c
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
 
Comcast Corporation
 
Yes
c
 
No
x
 
 
NBCUniversal Media, LLC
 
Yes
c
 
No
x
 
Indicate the number of shares outstanding of each of the registrant’s classes of stock, as of the latest practical date:
As of June 30, 2017, there were 4,703,928,010 shares of Comcast Corporation Class A common stock and 9,444,375 shares of Comcast Corporation Class B common stock outstanding.
Not applicable for NBCUniversal Media, LLC.
NBCUniversal Media, LLC meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this form with the reduced disclosure format.
 


TABLE OF CONTENTS
  
  
Page
Number
Item 1.
 
 
 
 
 
 
Item 2.
Item 3.
Item 4.
Item 1.
Item 1A.
Item 2.
Item 5.
Item 6.
 
Explanatory Note
This Quarterly Report on Form 10-Q is a combined report being filed separately by Comcast Corporation (“Comcast”) and NBCUniversal Media, LLC (“NBCUniversal”). Comcast owns all of the common equity interests in NBCUniversal, and NBCUniversal meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing its information within this Form 10-Q with the reduced disclosure format. Each of Comcast and NBCUniversal is filing on its own behalf the information contained in this report that relates to itself, and neither company makes any representation as to information relating to the other company. Where information or an explanation is provided that is substantially the same for each company, such information or explanation has been combined in this report. Where information or an explanation is not substantially the same for each company, separate information and explanation has been provided. In addition, separate condensed consolidated financial statements for each company, along with notes to the condensed consolidated financial statements, are included in this report. Unless indicated otherwise, throughout this Quarterly Report on Form 10-Q, we refer to Comcast and its consolidated subsidiaries, including NBCUniversal and its consolidated subsidiaries, as “we,” “us” and “our;” Comcast Cable Communications, LLC and its consolidated subsidiaries as “Comcast Cable;” Comcast Holdings Corporation as “Comcast Holdings;” NBCUniversal, LLC as “NBCUniversal Holdings;” and NBCUniversal Enterprise, Inc. as “NBCUniversal Enterprise.”
This Quarterly Report on Form 10-Q is for the three and six months ended June 30, 2017. This Quarterly Report on Form 10-Q modifies and supersedes documents filed before it. The Securities and Exchange Commission (“SEC”) allows us to “incorporate by reference” information that we file with it, which means that we can disclose important information to you by referring you directly to those documents. Information incorporated by reference is considered to be part of this Quarterly Report on Form 10-Q. In addition, information that we file with the SEC in the future will automatically update and supersede information contained in this Quarterly Report on Form 10-Q.
You should carefully review the information contained in this Quarterly Report on Form 10-Q and particularly consider any risk factors set forth in this Quarterly Report on Form 10-Q and in other reports or documents that we file from time to time with the


SEC. In this Quarterly Report on Form 10-Q, we state our beliefs of future events and of our future financial performance. In some cases, you can identify these so-called “forward-looking statements” by words such as “may,” “will,” “should,” “expects,” “believes,” “estimates,” “potential,” or “continue,” or the negative of these words, and other comparable words. You should be aware that these statements are only our predictions. In evaluating these statements, you should consider various factors, including the risks outlined below and in other reports we file with the SEC. Actual events or our actual results could differ materially from our forward-looking statements as a result of any such factors, which could adversely affect our businesses, results of operations or financial condition. We undertake no obligation to update any forward-looking statements.
Our businesses may be affected by, among other things, the following:
•
our businesses currently face a wide range of competition, and our businesses and results of operations could be adversely affected if we do not compete effectively
•
changes in consumer behavior driven by new technologies and distribution platforms for viewing content may 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 businesses depend on keeping pace with technological developments
•
we are subject to regulation by federal, state, local and foreign authorities, which may impose additional costs and restrictions on our businesses
•
changes to existing statutes, rules, regulations, or interpretations thereof, or adoption of new ones, could have an adverse effect on our businesses
•
programming expenses for our video services are increasing, which could adversely affect our Cable Communications segment’s video business
•
NBCUniversal’s success depends on consumer acceptance of its content, and its businesses may be adversely affected if its content fails to achieve sufficient consumer acceptance or the costs to create or acquire content increase
•
the loss of NBCUniversal’s programming distribution agreements, or the renewal of these agreements on less favorable terms, could adversely affect its businesses
•
we rely on network and information systems and other technologies, as well as key properties, and a disruption, cyber attack, failure or destruction of such networks, systems, technologies or properties may disrupt our businesses
•
we may be unable to obtain necessary hardware, software and operational support
•
weak economic conditions may have a negative impact on our businesses
•
our businesses depend on using and protecting certain intellectual property rights and on not infringing the intellectual property rights of others
•
acquisitions and other strategic initiatives, including the launch of our wireless phone service, present many risks, and we may not realize the financial and strategic goals that we had contemplated
•
labor disputes, whether involving employees or sports organizations, may disrupt our operations and adversely affect our businesses
•
the loss of key management personnel or popular on-air and creative talent could have an adverse effect on our businesses
•
we face risks relating to doing business internationally that could adversely affect our businesses
•
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

Table of Contents

PART I: FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
Comcast Corporation
Condensed Consolidated Balance Sheet
(Unaudited)
(in millions, except share data)
June 30,
2017
 
December 31,
2016
Assets
 
 
 
Current Assets:
 
 
 
Cash and cash equivalents
$
2,693

 
$
3,301

Receivables, net
7,849

 
7,955

Programming rights
1,633

 
1,250

Other current assets
2,657

 
3,855

Total current assets
14,832

 
16,361

Film and television costs
6,595

 
7,252

Investments
6,521

 
5,247

Property and equipment, net of accumulated depreciation of $49,951 and $49,694
37,171

 
36,253

Franchise rights
59,364

 
59,364

Goodwill
36,742

 
35,980

Other intangible assets, net of accumulated amortization of $11,900 and $11,013
18,907

 
17,274

Other noncurrent assets, net
2,899

 
2,769

Total assets
$
183,031

 
$
180,500

Liabilities and Equity
 
 
 
Current Liabilities:
 
 
 
Accounts payable and accrued expenses related to trade creditors
$
6,730

 
$
6,915

Accrued participations and residuals
1,882

 
1,726

Deferred revenue
1,448

 
1,132

Accrued expenses and other current liabilities
5,858

 
6,282

Current portion of long-term debt
6,358

 
5,480

Total current liabilities
22,276

 
21,535

Long-term debt, less current portion
57,210

 
55,566

Deferred income taxes
35,409

 
34,854

Other noncurrent liabilities
10,837

 
10,925

Commitments and contingencies (Note 10)


 


Redeemable noncontrolling interests and redeemable subsidiary preferred stock
1,451

 
1,446

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, 5,576,719,038 and 5,614,950,039; outstanding, 4,703,928,010 and 4,742,159,011
56

 
56

Class B common stock, $0.01 par value—authorized, 75,000,000 shares; issued and outstanding, 9,444,375
—

 
—

Additional paid-in capital
37,478

 
38,230

Retained earnings
24,560

 
23,076

Treasury stock, 872,791,028 Class A common shares
(7,517
)
 
(7,517
)
Accumulated other comprehensive income (loss)
428

 
98

Total Comcast Corporation shareholders’ equity
55,005

 
53,943

Noncontrolling interests
843

 
2,231

Total equity
55,848

 
56,174

Total liabilities and equity
$
183,031

 
$
180,500

See accompanying notes to condensed consolidated financial statements.

1
Table of Contents

Comcast Corporation

Condensed Consolidated Statement of Income
(Unaudited)
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions, except per share data)
2017
 
2016
 
2017
 
2016
Revenue
$
21,165

 
$
19,269

 
$
41,628

 
$
38,059

Costs and Expenses:
 
 
 
 

 

Programming and production
6,341

 
5,492

 
12,415

 
10,923

Other operating and administrative
6,060

 
5,763

 
11,887

 
11,289

Advertising, marketing and promotion
1,665

 
1,559

 
3,195

 
3,025

Depreciation
1,970

 
1,868

 
3,885

 
3,653

Amortization
571

 
521

 
1,158

 
1,014

 
16,607

 
15,203

 
32,540

 
29,904

Operating income
4,558

 
4,066

 
9,088

 
8,155

Other Income (Expense):
 
 
 
 
 
 
 
Interest expense
(758
)
 
(732
)
 
(1,513
)
 
(1,435
)
Investment income (loss), net
64

 
58

 
123

 
88

Equity in net income (losses) of investees, net
15

 
(19
)
 
51

 
(30
)
Other income (expense), net
20

 
(15
)
 
55

 
115

 
(659
)
 
(708
)
 
(1,284
)
 
(1,262
)
Income before income taxes
3,899

 
3,358

 
7,804

 
6,893

Income tax expense
(1,364
)
 
(1,278
)
 
(2,622
)
 
(2,589
)
Net income
2,535

 
2,080

 
5,182

 
4,304

Net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock
(22
)
 
(52
)
 
(103
)
 
(142
)
Net income attributable to Comcast Corporation
$
2,513

 
$
2,028

 
$
5,079

 
$
4,162

Basic earnings per common share attributable to Comcast Corporation shareholders
$
0.53

 
$
0.42

 
$
1.07

 
$
0.86

Diluted earnings per common share attributable to Comcast Corporation shareholders
$
0.52

 
$
0.41

 
$
1.05

 
$
0.85

Dividends declared per common share
$
0.1575

 
$
0.1375

 
$
0.315

 
$
0.275

See accompanying notes to condensed consolidated financial statements.

2
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Comcast Corporation

Condensed Consolidated Statement of Comprehensive Income
(Unaudited) 
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Net income
$
2,535

 
$
2,080

 
$
5,182

 
$
4,304

Unrealized gains (losses) on marketable securities, net of deferred taxes of $52, $—, $(9) and $(1)
(87
)
 
1

 
17

 
3

Deferred gains (losses) on cash flow hedges, net of deferred taxes of $(3), $35, $(7) and $53
5

 
(60
)
 
12

 
(91
)
Amounts reclassified to net income:
 
 
 
 
 
 
 
Realized (gains) losses on marketable securities, net of deferred taxes of $—, $—, $— and $1
—

 
—

 
—

 
(1
)
Realized (gains) losses on cash flow hedges, net of deferred taxes of $8, $(26), $8 and $(36)
(14
)
 
45

 
(14
)
 
62

Employee benefit obligations, net of deferred taxes of $4, $—, $(33) and $(2)
(6
)
 
—

 
57

 
2

Currency translation adjustments, net of deferred taxes of $2, $(58), $(39) and $(116)
(11
)
 
249

 
146

 
487

Comprehensive income
2,422

 
2,315

 
5,400

 
4,766

Net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock
(22
)
 
(52
)
 
(103
)
 
(142
)
Other comprehensive (income) loss attributable to noncontrolling interests
5

 
(150
)
 
(82
)
 
(287
)
Comprehensive income attributable to Comcast Corporation
$
2,405

 
$
2,113

 
$
5,215

 
$
4,337

See accompanying notes to condensed consolidated financial statements.

3
Table of Contents

Comcast Corporation

Condensed Consolidated Statement of Cash Flows
(Unaudited) 
 
Six Months Ended
June 30
(in millions)
2017
 
2016
Net cash provided by operating activities
$
10,814

 
$
9,794

Investing Activities
 
 
 
Capital expenditures
(4,405
)
 
(4,156
)
Cash paid for intangible assets
(836
)
 
(737
)
Acquisitions and construction of real estate properties
(250
)
 
(211
)
Acquisitions, net of cash acquired
(398
)
 
(126
)
Proceeds from sales of investments
57

 
138

Purchases of investments
(1,825
)
 
(580
)
Other
170

 
(156
)
Net cash provided by (used in) investing activities
(7,487
)
 
(5,828
)
Financing Activities
 
 
 
Proceeds from (repayments of) short-term borrowings, net
(1,695
)
 
205

Proceeds from borrowings
8,963

 
4,753

Repurchases and repayments of debt
(4,967
)
 
(2,551
)
Repurchases of common stock under repurchase program and employee plans
(2,476
)
 
(2,636
)
Dividends paid
(1,404
)
 
(1,281
)
Purchase of Universal Studios Japan noncontrolling interests
(2,299
)
 
—

Issuances of common stock
—

 
19

Distributions to noncontrolling interests and dividends for redeemable subsidiary preferred stock
(137
)
 
(125
)
Other
80

 
20

Net cash provided by (used in) financing activities
(3,935
)
 
(1,596
)
Increase (decrease) in cash and cash equivalents
(608
)
 
2,370

Cash and cash equivalents, beginning of period
3,301

 
2,295

Cash and cash equivalents, end of period
$
2,693

 
$
4,665

See accompanying notes to condensed consolidated financial statements.

4
Table of Contents

Comcast Corporation

Condensed Consolidated Statement of Changes in Equity
(Unaudited) 
 
Redeemable
Noncontrolling
Interests and
Redeemable
Subsidiary
Preferred Stock
 
Common Stock
Additional
Paid-In
Capital
Retained
Earnings
Treasury
Stock at
Cost
Accumulated
Other
Comprehensive
Income (Loss)
Non-
controlling
Interests
Total
Equity
(in millions)
A
B
Balance, December 31, 2015
$
1,221

$
57

$
—

$
38,490

$
21,413

$
(7,517
)
$
(174
)
$
1,709

$
53,978

Stock compensation plans
 
 
 
422

 
 
 
 
422

Repurchases of common stock under repurchase program and employee plans
 
 
 
(519
)
(2,121
)
 
 
 
(2,640
)
Employee stock purchase plans
 
 
 
78

 
 
 
 
78

Dividends declared
 
 
 
 
(1,337
)
 
 
 
(1,337
)
Other comprehensive income (loss)
 
 
 
 
 
 
175

287

462

Contributions from (distributions to) noncontrolling interests, net
1

 
 
 
 
 
 
(68
)
(68
)
Other
(20
)
 
 
(31
)
 
 
 
154

123

Net income (loss)
46

 
 
 
4,162

 
 
96

4,258

Balance, June 30, 2016
$
1,248

$
57

$
—

$
38,440

$
22,117

$
(7,517
)
$
1

$
2,178

$
55,276

Balance, December 31, 2016
$
1,446

$
56

$
—

$
38,230

$
23,076

$
(7,517
)
$
98

$
2,231

$
56,174

Stock compensation plans
 
 
 
288

 
 
 
 
288

Repurchases of common stock under repurchase program and employee plans
 


 
(379
)
(2,097
)
 
 
 
(2,476
)
Employee stock purchase plans
 
 
 
94

 
 
 
 
94

Dividends declared
 
 
 
 
(1,498
)
 
 
 
(1,498
)
Other comprehensive income (loss)
 
 
 
 
 
 
136

82

218

Contributions from (distributions to) noncontrolling interests, net
(27
)
 
 
 
 
 
 
(49
)
(49
)
 Purchase of Universal Studios Japan noncontrolling interests
 
 
 
(696
)
 
 
194

(1,736
)
(2,238
)
Other
(9
)
 
 
(59
)
 
 
 
253

194

Net income (loss)
41

 
 
 
5,079

 
 
62

5,141

Balance, June 30, 2017
$
1,451

$
56

$
—

$
37,478

$
24,560

$
(7,517
)
$
428

$
843

$
55,848

See accompanying notes to condensed consolidated financial statements.

5
Table of Contents

Comcast Corporation

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1: Condensed Consolidated Financial Statements
Basis of Presentation
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, financial condition and cash flows 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 2016 Annual Report on Form 10-K.
Stock Split
On January 24, 2017, our Board of Directors approved a two-for-one stock split in the form of a 100% stock dividend that was distributed on February 17, 2017 to shareholders of record as of February 8, 2017. The stock split was in the form of one additional share for every share held and was payable in shares of Class A common stock on the existing Class A common stock and Class B common stock. All share-based data, including the number of shares outstanding and per share amounts, have been adjusted to reflect the stock split for all periods presented.
Reclassifications
Reclassifications have been made to our condensed consolidated financial statements for the prior year periods to conform to classifications used in 2017.
Note 2: Recent Accounting Pronouncements
Revenue Recognition
In May 2014, the Financial Accounting Standards Board (“FASB”) updated the accounting guidance related to revenue recognition. The updated accounting guidance provides a single, contract-based revenue recognition model to help improve financial reporting by providing clearer guidance on when an entity should recognize revenue and by reducing the number of standards to which an entity has to refer. The updated accounting guidance is effective for us as of January 1, 2018.
We have substantially completed the review of our revenue arrangements and do not currently expect that the adoption of the new standard will have a material impact on our financial position or results of operations. However, we do expect that the new standard will impact the timing of recognition for (1) our Cable Communications segment’s installation revenue and commission expenses, which will be recognized as revenue and costs over a period of time instead of immediately, and (2) our Cable Networks, Broadcast Television and Filmed Entertainment segments’ content licensing revenue associated with renewals or extensions of existing program licensing agreements, which will be recognized as revenue when the licensed content becomes available under the renewal or extension instead of when the agreement is renewed or extended. In addition, upon adoption, we anticipate implementing certain changes in the presentation of revenue and expenses, including changes related to the allocation of revenue among the cable services included in a bundle that our residential customers purchase at a discount. The updated guidance also requires additional disclosures regarding the nature, timing and uncertainty of our revenue transactions. We intend to adopt the provisions of the guidance using the full retrospective method, under which we will adjust any prior periods presented to reflect the updated guidance.
Financial Assets and Financial Liabilities
In January 2016, the FASB updated the accounting guidance related to the recognition and measurement of financial assets and financial liabilities. The updated accounting guidance, among other things, requires that all nonconsolidated equity investments, except those accounted for under the equity method, be measured at fair value and that the changes in fair value be recognized in net income. The updated guidance is effective for us as of January 1, 2018. The updated accounting guidance requires a cumulative effect adjustment to beginning retained earnings in the year the guidance is adopted with certain exceptions. If we had adopted the provisions of the updated guidance as of January 1, 2017 for our equity investments classified as available-for-sale securities, primarily our investment in Snap Inc. (see Note 6), net income attributable to Comcast Corporation would have decreased for the three months ended June 30, 2017 by $88 million and increased for the six months ended June 30, 2017 by $16 million. We are currently in the process of determining the impact that the updated accounting guidance will have on our cost method investments.

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Comcast Corporation

Leases
In February 2016, the FASB updated the accounting guidance related to leases. The updated accounting guidance requires lessees to recognize a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. The asset and liability are initially measured based on the present value of committed lease payments. For a lessee, the recognition, measurement and presentation of expenses and cash flows arising from a lease do not significantly change from previous guidance. For a lessor, the accounting applied is also largely unchanged from previous guidance. The updated guidance is effective for us as of January 1, 2019 and early adoption is permitted. The updated accounting guidance must be adopted using a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. We are currently in the process of determining the impact that the updated accounting guidance will have on our consolidated financial statements.
Share-Based Compensation
In March 2016, the FASB updated the accounting guidance that affects several aspects of the accounting for share-based compensation. The most significant change for us relates to the presentation of the income and withholding tax consequences of share-based compensation in our consolidated financial statements. Among the changes, the updated guidance requires that the excess income tax benefits or deficiencies that arise when the tax consequences of share-based compensation differ from amounts previously recognized in the statement of income be recognized as income tax benefit or expense in the statement of income rather than as additional paid-in capital in the balance sheet. The guidance also states that excess income tax benefits should not be presented separately from other income taxes in the statement of cash flows and, thus, should be classified as an operating activity rather than a financing activity as they were under the prior guidance. In addition, the updated guidance requires that, when an employer withholds shares upon exercise of options or the vesting of restricted stock for the purpose of meeting withholding tax requirements, the cash paid for withholding taxes be classified as a financing activity and we include these amounts in the caption “repurchases of common stock under repurchase program and employee plans” in our consolidated statement of cash flows. We previously recorded these amounts as operating activities.
We adopted the updated guidance as of January 1, 2017 and, as required, we prospectively adopted the provisions that relate to the recognition of the excess income tax benefits or deficiencies in our condensed consolidated statement of income. The excess tax benefits resulted in a decrease to income tax expense of $59 million and $198 million for the three and six months ended June 30, 2017, respectively. In addition, the excess tax benefits resulted in an increase to diluted earnings per common share attributable to Comcast Corporation shareholders of $0.01 and $0.03 for the three and six months ended June 30, 2017, respectively. As required by the updated guidance, the prior year periods in our condensed consolidated statement of income were not adjusted as a result of these provisions.
In addition, we retrospectively adopted the provisions of this guidance related to changes to the statement of cash flows for all periods presented. This resulted in increases to net cash provided by operating activities and decreases to net cash provided by (used in) financing activities of $543 million and $411 million for the six months ended June 30, 2017 and 2016, respectively.
Note 3: Earnings Per Share
Computation of Diluted EPS
 
Three Months Ended June 30
 
2017
 
2016
(in millions, except per share data)
Net Income
Attributable to
Comcast
Corporation
 
Shares
 
Per Share
Amount
 
Net Income
Attributable to
Comcast
Corporation
 
Shares
 
Per Share
Amount
Basic EPS attributable to Comcast Corporation shareholders
$
2,513

 
4,728

 
$
0.53

 
$
2,028

 
4,839

 
$
0.42

Effect of dilutive securities:
 
 
 
 
 
 
 
 
 
 
 
Assumed exercise or issuance of shares relating to stock plans
 
 
81

 
 
 
 
 
52

 
 
Diluted EPS attributable to Comcast Corporation shareholders
$
2,513

 
4,809

 
$
0.52

 
$
2,028

 
4,891

 
$
0.41



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Six Months Ended June 30
 
2017
 
2016
(in millions, except per share amounts)
Net Income
Attributable to
Comcast
Corporation
 
Shares
 
Per Share
Amount
 
Net Income
Attributable to
Comcast
Corporation
 
Shares
 
Per Share
Amount
Basic EPS attributable to Comcast Corporation shareholders
$
5,079

 
4,738

 
$
1.07

 
$
4,162

 
4,853

 
$
0.86

Effect of dilutive securities:
 
 
 
 
 
 
 
 
 
 
 
Assumed exercise or issuance of shares relating to stock plans
 
 
82

 
 
 
 
 
55

 
 
Diluted EPS attributable to Comcast Corporation shareholders
$
5,079

 
4,820

 
$
1.05

 
$
4,162

 
4,908

 
$
0.85

Diluted earnings per common share attributable to Comcast Corporation shareholders (“diluted EPS”) considers the impact of potentially dilutive securities using the treasury stock method. Our potentially dilutive securities include potential common shares related to our stock options and our restricted share units (“RSUs”). The amount of potential common shares related to our share-based compensation plans that were excluded from diluted EPS because their effect would have been antidilutive was not material for the three and six months ended June 30, 2017 and 2016.
Note 4: Significant Transactions
FCC Spectrum Auction
On April 13, 2017, the Federal Communications Commission announced the results of its spectrum auction. In the auction, NBCUniversal relinquished its spectrum rights in the New York, Philadelphia and Chicago designated market areas (“DMAs”) where NBC and Telemundo had overlapping spectrum. NBCUniversal received proceeds of $482 million in July 2017. NBC and Telemundo stations will share broadcast signals in these DMAs. In connection with the auction, we also acquired the rights to $1.7 billion of spectrum, which were recorded to other intangible assets, net in our condensed consolidated balance sheet as of June 30, 2017. We had previously made a deposit of $1.8 billion to participate in the auction in the third quarter of 2016 and received a refund for amounts in excess of the purchase price in the second quarter of 2017.
Universal Studios Japan
On April 6, 2017, we acquired the remaining interests in Universal Studios Japan that we did not already own for $2.3 billion. The acquisition was funded through cash on hand and borrowings under our commercial paper program. Because we maintained control of Universal Studios Japan, the difference between the consideration transferred and the recorded value of the noncontrolling interests, as well as the related tax and accumulated other comprehensive income impacts, were recorded to additional paid-in capital.
DreamWorks Animation
On August 22, 2016, we acquired all of the outstanding stock of DreamWorks Animation for $3.8 billion. DreamWorks Animation’s stockholders received $41 in cash for each share of DreamWorks Animation common stock. DreamWorks Animation creates animated feature films, television series and specials, live entertainment, and related consumer products. The results of operations for DreamWorks Animation are reported in our Filmed Entertainment segment following the acquisition date.
Allocation of Purchase Price
The transaction was accounted for under the acquisition method of accounting and, accordingly, the assets and liabilities are to be recorded at their fair market values as of the acquisition date. We recorded the acquired assets and liabilities of DreamWorks Animation at their estimated fair values based on valuation analyses. In valuing acquired assets and liabilities, fair value estimates were primarily based on Level 3 inputs, including future expected cash flows, market rate assumptions and discount rates. The fair value of the assumed debt was primarily based on quoted market values. The fair value of the liability related to a tax receivable agreement that DreamWorks Animation had previously entered into with one of its former stockholders (the “tax receivable agreement”) was based on the contractual settlement provisions in the agreement. Further, we recorded deferred income taxes based on our estimates of the tax basis of the acquired net assets and the valuation allowances based on the expected use of net operating loss carryforwards. The goodwill is not deductible for tax purposes. During the six months ended June 30, 2017, we updated the preliminary allocation of purchase price for DreamWorks Animation, which primarily resulted in increases to noncontrolling interests, intangible assets and goodwill and decreases to working capital and deferred income tax assets. The changes did not have a material impact on our condensed consolidated financial statements. We may adjust these amounts further

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as valuations are finalized and we obtain information necessary to complete the analyses, but no later than one year from the acquisition date.
The table below presents the preliminary allocation of the purchase price to the assets and liabilities of DreamWorks Animation.
Allocation of Purchase Price
(in millions)
  
Film and television costs
$
854

Intangible assets
396

Working capital
163

Debt
(381
)
Tax receivable agreement
(146
)
Deferred income taxes
301

Other noncurrent assets and liabilities
134

Identifiable net assets (liabilities) acquired
1,321

Noncontrolling interests
(337
)
Goodwill
2,789

Cash consideration transferred
$
3,773

The tax receivable agreement was settled immediately following the acquisition and the payment was recorded as an operating activity in our condensed consolidated statement of cash flows in the third quarter of 2016. We also repaid all of the assumed debt of DreamWorks Animation in the third quarter of 2016.
Revenue and net income attributable to the acquisition of DreamWorks Animation were not material for the three and six months ended June 30, 2017.
Note 5: Film and Television Costs
(in millions)
June 30,
2017
 
December 31,
2016
Film Costs:
 
 
 
Released, less amortization
$
1,949

 
$
1,750

Completed, not released
93

 
50

In production and in development
813

 
1,310

 
2,855

 
3,110

Television Costs:
 
 
 
Released, less amortization
1,888

 
1,953

In production and in development
751

 
853

 
2,639

 
2,806

Programming rights, less amortization
2,734

 
2,586

 
8,228

 
8,502

Less: Current portion of programming rights
1,633

 
1,250

Film and television costs
$
6,595

 
$
7,252


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Note 6: Investments
(in millions)
June 30,
2017
 
December 31,
2016
Fair Value Method:
 
 
 
Snap
$
522

 
$
—

Other
163

 
198


685

 
198

Equity Method:


 


Atairos
2,233

 
1,601

Hulu
218

 
225

Other
653

 
550


3,104

 
2,376

Cost Method:

 

AirTouch
1,606

 
1,599

BuzzFeed
400

 
400

Other
759

 
771

 
2,765

 
2,770

Total investments
6,554

 
5,344

Less: Current investments
33

 
97

Noncurrent investments
$
6,521

 
$
5,247

Investment Income (Loss), Net
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Gains (losses) on sales and exchanges of investments, net
$
—

 
$
13

 
$
(1
)
 
$
15

Investment impairment losses
(2
)
 
(1
)
 
(6
)
 
(21
)
Interest and dividend income
32

 
31

 
65

 
60

Other, net
34

 
15

 
65

 
34

Investment income (loss), net
$
64

 
$
58

 
$
123

 
$
88

Fair Value Method
Snap
In March 2017, we acquired an interest in Snap Inc. for $500 million as part of its initial public offering, which we have classified as an available-for-sale security. Snap is a camera company whose primary product is Snapchat, a camera app that was created to help people communicate through short videos and images.
Equity Method
Atairos
For the six months ended June 30, 2017, we made cash capital contributions totaling $994 million to Atairos Group, Inc., which included amounts accrued as of December 31, 2016. Atairos 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 income. We recognize our share of these gains and losses in equity in net income (losses) of investees, net. For the three and six months ended June 30, 2017, our share of Atairos income was $42 million and $99 million, respectively. For the three and six months ended June 30, 2016, our share of Atairos losses was $12 million and $27 million, respectively.
The Weather Channel
In January 2016, following a legal restructuring at The Weather Channel, we and the other investors sold the entity holding The Weather Channel’s product and technology businesses to IBM. Following the close of the transaction, we continue to hold an investment in The Weather Channel cable network through a new holding company. As a result of the sale of our investment, we recognized a pretax gain of $108 million in other income (expense), net for the six months ended June 30, 2016.

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Cost Method
AirTouch
We hold two series of preferred stock of Verizon Americas, Inc., formerly known as AirTouch Communications, Inc. (“AirTouch”), a subsidiary of Verizon Communications Inc., which are redeemable in April 2020. As of June 30, 2017, the estimated fair value of the AirTouch preferred stock and the estimated fair value of the associated liability related to the redeemable subsidiary preferred shares issued by one of our consolidated subsidiaries were each $1.7 billion. The estimated fair values are based on Level 2 inputs that use pricing models whose inputs are derived primarily from or corroborated by observable market data through correlation or other means for substantially the full term of the financial instrument.
Note 7: Long-Term Debt
As of June 30, 2017, our debt had a carrying value of $63.6 billion and an estimated fair value of $70.3 billion. The estimated fair value of our publicly traded debt was primarily based on Level 1 inputs that use quoted market values 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.
Debt Borrowings and Repayments
In June 2017, NBCUniversal Enterprise issued $1.5 billion aggregate principal amount of senior floating rate notes due 2021. In March 2017, we issued $1.005 billion aggregate principal amount of 4.45% senior notes due 2047. In January 2017, we issued $1.25 billion aggregate principal amount of 3.00% senior notes due 2024 and $1.25 billion aggregate principal amount of 3.30% senior notes due 2027.
In May 2017, we repaid at maturity $550 million aggregate principal amount of 8.875% senior notes due 2017. In January 2017, we repaid at maturity $1.0 billion aggregate principal amount of 6.50% senior notes due 2017.
In May 2017, Universal Studios Japan entered into a new ¥450 billion ($3.9 billion at issuance) term loan with a final maturity of March 2022. We used the proceeds from this borrowing to repay in full $3.3 billion of Universal Studios Japan’s existing yen-denominated term loans and a portion of amounts outstanding under our commercial paper program.
Revolving Credit Facilities
As of June 30, 2017, amounts available under our consolidated revolving credit facilities, net of amounts outstanding under our commercial paper programs and outstanding letters of credit, totaled $7.2 billion, which included $1.5 billion available under NBCUniversal Enterprise’s revolving credit facility.
Commercial Paper Programs
In June 2017, we increased the Comcast and NBCUniversal Enterprise commercial paper programs to $7.0 billion and $1.5 billion, respectively, to coincide with the Comcast and NBCUniversal Enterprise revolving credit facilities’ commitments.
As of June 30, 2017, Comcast had $1.1 billion face amount of commercial paper outstanding and NBCUniversal Enterprise had no commercial paper outstanding.
Note 8: Share-Based Compensation
Our share-based compensation plans consist primarily of awards of RSUs and stock options to certain employees and directors as part of our approach to long-term incentive compensation. 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 2017, we granted 10.6 million RSUs and 39.1 million stock options related to our annual management awards. The weighted-average fair values associated with these grants were $37.42 per RSU and $7.01 per stock option.
Recognized Share-Based Compensation Expense
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Restricted share units
$
111

 
$
89

 
$
185

 
$
159

Stock options
63

 
48

 
103

 
85

Employee stock purchase plans
7

 
8

 
17

 
16

Total
$
181

 
$
145


$
305

 
$
260

As of June 30, 2017, we had unrecognized pretax compensation expense of $915 million and $502 million related to nonvested RSUs and nonvested stock options, respectively.

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Note 9: Supplemental Financial Information
Receivables
(in millions)
June 30,
2017
 
December 31,
2016
Receivables, gross
$
8,459

 
$
8,622

Less: Allowance for returns and customer incentives
345

 
417

Less: Allowance for doubtful accounts
265

 
250

Receivables, net
$
7,849

 
$
7,955

Accumulated Other Comprehensive Income (Loss)
(in millions)
June 30,
2017
 
June 30,
2016
Unrealized gains (losses) on marketable securities
$
17

 
$
3

Deferred gains (losses) on cash flow hedges
(16
)
 
(75
)
Unrecognized gains (losses) on employee benefit obligations
276

 
8

Cumulative translation adjustments
151

 
65

Accumulated other comprehensive income (loss), net of deferred taxes
$
428

 
$
1

Net Cash Provided by Operating Activities
 
Six Months Ended
June 30
(in millions)
2017
 
2016
Net income
$
5,182

 
$
4,304

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
5,043

 
4,667

Share-based compensation
391

 
331

Noncash interest expense (income), net
122

 
113

Equity in net (income) losses of investees, net
(51
)
 
30

Cash received from investees
49

 
42

Net (gain) loss on investment activity and other
(110
)
 
(126
)
Deferred income taxes
470

 
618

Changes in operating assets and liabilities, net of effects of acquisitions and divestitures:
 
 
 
Current and noncurrent receivables, net
18

 
172

Film and television costs, net
277

 
(171
)
Accounts payable and accrued expenses related to trade creditors
(144
)
 
(104
)
Other operating assets and liabilities
(433
)
 
(82
)
Net cash provided by operating activities
$
10,814

 
$
9,794

Cash Payments for Interest and Income Taxes 
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Interest
$
477

 
$
512

 
$
1,372

 
$
1,235

Income taxes
$
2,077

 
$
1,495

 
$
2,209

 
$
1,685

Noncash Investing and Financing Activities
During the six months ended June 30, 2017:
•
we acquired $1.3 billion of property and equipment and intangible assets that were accrued but unpaid
•
we recorded a liability of $742 million for a quarterly cash dividend of $0.1575 per common share to be paid in July 2017

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Note 10: Commitments and Contingencies
Redeemable Subsidiary Preferred Stock
As of June 30, 2017, the fair value of the NBCUniversal Enterprise redeemable subsidiary preferred stock was $762 million. The estimated fair value is based on Level 2 inputs that use pricing models whose inputs are derived primarily from or corroborated by observable market data through correlation or other means for substantially the full term of the financial instrument.
Contingencies
We are a defendant in a lawsuit filed in December 2011 by Sprint Communications Company L.P. (“Sprint”) in the United States District Court for the District of Kansas. Sprint’s initial complaint alleged that Comcast Digital Voice and XFINITY Voice infringe twelve Sprint patents covering various aspects of a telecommunications system. In March 2015, Sprint withdrew its allegations of infringement for two of the patents. In December 2016, the Court granted summary judgment for us with respect to non-infringement on one of the patents and granted summary judgment for Sprint on one of the patents as to infringement with respect to some but not all of our accused telecommunications systems but not as to the patent’s validity. In January 2017, the Court entered judgment in favor of us on Sprint’s claims for infringement of two of the patents. In March 2017, Sprint indicated that it would not proceed to trial on three of the patents. Trial with respect to the four remaining patents, including the patent for which the Court granted partial summary judgment to Sprint, is set to begin in late October 2017. Sprint seeks approximately $950 million in damages, plus pre-judgment interest. In July 2017, Sprint filed a motion to amend the pre-trial order seeking to add an allegation that we willfully infringed Sprint’s patents and should be subject to increased damages, which could as much as triple the amount of any damages awarded. In July 2017, Sprint also filed a motion for partial summary judgment of certain of our defenses.
We believe the claims in the Sprint lawsuit are without merit and are defending the action vigorously. We cannot predict the outcome of the Sprint lawsuit, estimate a range of possible loss or determine how the final resolution of the action would affect our results of operations or cash flows for any one period or our consolidated financial position. In addition, as any action nears a trial, there is an increased possibility that the action may be settled by the parties. Nevertheless, we do not expect the final disposition of the Sprint lawsuit to have a material adverse effect on our consolidated financial position, but it could be material to our consolidated results of operations or cash flows for any one period.
We also are a defendant in several unrelated lawsuits claiming infringement of various patents relating to various aspects of our businesses. In certain of these cases, other industry participants are also defendants, and also in certain of these cases, we expect that any potential liability would be in part or in whole the responsibility of our equipment and technology vendors under applicable contractual indemnification provisions, including the Sprint lawsuit above. In addition, we are subject to other legal proceedings and claims that arise in the ordinary course of our business. While the amount of ultimate liability with respect to such actions is not expected to materially affect our results of operations, cash flows or financial position, any litigation resulting from any such legal proceedings or claims could be time-consuming and injure our reputation.
Note 11: Financial Data by Business Segment
We present our operations in five reportable business segments:
•
Cable Communications: Consists of the operations of Comcast Cable, which is one of the nation’s largest providers of video, high-speed Internet, voice, and security and automation services to residential customers under the XFINITY brand; we also provide these and other services to business customers and sell advertising.
•
Cable Networks: Consists primarily of our national cable networks, our regional sports and news networks, our international cable networks, and our cable television studio production operations.
•
Broadcast Television: Consists primarily of the NBC and Telemundo broadcast networks, our NBC and Telemundo owned local broadcast television stations, the NBC Universo national cable network, and our broadcast television studio production operations.
•
Filmed Entertainment: Consists primarily of the operations of Universal Pictures, which produces, acquires, markets and distributes filmed entertainment worldwide; our films are also produced under the Illumination, Focus Features and DreamWorks Animation names.
•
Theme Parks: Consists primarily of our Universal theme parks in Orlando, Florida; Hollywood, California; and Osaka, Japan.
We use Adjusted EBITDA (formerly operating income before depreciation and amortization) to evaluate the profitability of our operating segments and the components of net income attributable to Comcast Corporation below Adjusted EBITDA are not separately evaluated. Our financial data by business segment is presented in the tables below.

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Three Months Ended June 30, 2017
(in millions)
Revenue(e)
Adjusted EBITDA(f)
Depreciation
and Amortization
Operating
Income (Loss)
Capital
Expenditures
Cash Paid for Intangible Assets
Cable Communications(a)
$
13,122

$
5,320

$
2,001

$
3,319

$
1,956

$
327

NBCUniversal
 
 
 
 
 
 
Cable Networks
2,696

1,055

181

874

8

4

Broadcast Television
2,241

416

31

385

30

4

Filmed Entertainment
2,155

285

26

259

19

6

Theme Parks
1,314

551

186

365

243

26

Headquarters and Other(b)
9

(235
)
96

(331
)
38

33

Eliminations(c)
(84
)
(1
)
—

(1
)
—

—

NBCUniversal
8,331

2,071

520

1,551

338

73

Corporate and Other(d)
205

(302
)
20

(322
)
33

20

Eliminations(c)
(493
)
10

—

10

—

—

Comcast Consolidated
$
21,165

$
7,099

$
2,541

$
4,558

$
2,327

$
420

 
Three Months Ended June 30, 2016
(in millions)
Revenue(e)
Adjusted EBITDA(f)
Depreciation
and Amortization
Operating
Income (Loss)
Capital
Expenditures
Cash Paid for Intangible Assets
Cable Communications(a)
$
12,444

$
5,048

$
1,904

$
3,144

$
1,881

$
289

NBCUniversal
 
 
 
 
 
 
Cable Networks
2,566

944

187

757

7

3

Broadcast Television
2,128

394

30

364

30

3

Filmed Entertainment
1,351

56

12

44

5

3

Theme Parks
1,136

469

145

324

240

20

Headquarters and Other(b)
6

(175
)
91

(266
)
78

33

Eliminations(c)
(84
)
1

—

1

—

—

NBCUniversal
7,103

1,689

465

1,224

360

62

Corporate and Other(d)
180

(291
)
20

(311
)
30

8

Eliminations(c)
(458
)
9

—

9

—

—

Comcast Consolidated
$
19,269

$
6,455

$
2,389

$
4,066

$
2,271

$
359

 
Six Months Ended June 30, 2017
(in millions)
Revenue(e)
Adjusted EBITDA(f)
Depreciation
and Amortization
Operating
Income (Loss)
Capital
Expenditures
Cash Paid for Intangible Assets
Cable Communications(a)
$
26,034

$
10,518

$
3,981

$
6,537

$
3,737

$
679

NBCUniversal
 
 
 
 
 

Cable Networks
5,337

2,171

395

1,776

10

7

Broadcast Television
4,449

738

63

675

59

7

Filmed Entertainment
4,136

653

47

606

29

11

Theme Parks
2,432

948

328

620

472

39

Headquarters and Other(b)
17

(420
)
195

(615
)
53

64

Eliminations(c)
(172
)
(2
)
—

(2
)
—

—

NBCUniversal
16,199

4,088

1,028

3,060

623

128

Corporate and Other(d)
413

(496
)
34

(530
)
45

29

Eliminations(c)
(1,018
)
21

—

21

—

—

Comcast Consolidated
$
41,628

$
14,131

$
5,043

$
9,088

$
4,405

$
836


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Six Months Ended June 30, 2016
(in millions)
Revenue(e)
Adjusted EBITDA(f)
Depreciation
and Amortization
Operating
Income (Loss)
Capital
Expenditures
Cash Paid for Intangible Assets
Cable Communications(a)
$
24,648

$
9,937

$
3,747

$
6,190

$
3,457

$
613

NBCUniversal
 
 
 
 
 

Cable Networks
5,019

1,900

377

1,523

8

4

Broadcast Television
4,212

678

62

616

49

6

Filmed Entertainment
2,734

223

20

203

8

6

Theme Parks
2,162

844

243

601

440

29

Headquarters and Other(b)
9

(335
)
177

(512
)
150

69

Eliminations(c)
(172
)
1

—

1

—

—

NBCUniversal
13,964

3,311

879

2,432

655

114

Corporate and Other(d)
379

(445
)
41

(486
)
44

10

Eliminations(c)
(932
)
19

—

19

—

—

Comcast Consolidated
$
38,059

$
12,822

$
4,667

$
8,155

$
4,156

$
737

(a)
For the three and six months ended June 30, 2017 and 2016, Cable Communications segment revenue was derived from the following sources:
 
Three Months Ended
June 30
 
Six Months Ended
June 30
  
2017
 
2016
 
2017
 
2016
Residential:
 
 
 
 
 
 
 
Video
44.2
%
 
44.9
%
 
44.4
%
 
45.1
%
High-speed Internet
28.0
%
 
27.1
%
 
28.0
%
 
27.0
%
Voice
6.5
%
 
7.2
%
 
6.6
%
 
7.3
%
Business services
11.7
%
 
10.9
%
 
11.6
%
 
10.8
%
Advertising
4.4
%
 
4.7
%
 
4.2
%
 
4.6
%
Other
5.2
%
 
5.2
%
 
5.2
%
 
5.2
%
Total
100.0
%
 
100.0
%
 
100.0
%
 
100.0
%
Subscription revenue received from residential customers who purchase bundled services at a discounted rate is allocated proportionally to each cable service based on the individual service’s price on a stand-alone basis.
For the three and six months ended June 30, 2017 and 2016, 2.8% of Cable Communications segment revenue was derived from franchise and other regulatory fees.
(b)
NBCUniversal Headquarters and Other activities include costs associated with overhead, allocations, personnel costs and headquarter initiatives.
(c)
Included in Eliminations are transactions that our segments enter into with one another. The most common types of transactions are the following:
•
our Cable Networks segment generates revenue by selling programming to our Cable Communications segment, which represents a substantial majority of the revenue elimination amount
•
our Broadcast Television segment generates revenue from the fees received under retransmission consent agreements with our Cable Communications segment
•
our Cable Communications segment generates revenue by selling advertising and by selling the use of satellite feeds to our Cable Networks segment
•
our Filmed Entertainment and Broadcast Television segments generate revenue from the licensing of film and television content to our Cable Networks segment
(d)
Corporate and Other activities include costs associated with overhead and personnel, the costs of other business initiatives, including our new wireless phone service, and the operations of Comcast Spectacor, which owns the Philadelphia Flyers and the Wells Fargo Center arena in Philadelphia, Pennsylvania and operates arena management-related businesses.
(e)
No single customer accounted for a significant amount of revenue in any period.
(f)
We use Adjusted EBITDA as the measure of profit or loss for our operating segments. Adjusted EBITDA is defined as net income attributable to Comcast Corporation before net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock, income tax expense, other income (expense) items, net, and depreciation and amortization, and excluding impairment charges related to fixed and intangible assets and gains or losses on the sale of long-lived assets, if any. Other income (expense) items, net include interest expense, investment income (loss), equity in net income (losses) of investees, and other income (expense), net (as stated in our condensed consolidated statement of income). 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. Additionally, it is unaffected by our capital and tax structures and by our investment activities. We use this 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. We believe that this measure 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 may not be directly comparable to similar measures used by other companies. This measure should not be considered a substitute for operating income (loss), net income (loss), net income (loss) attributable to Comcast Corporation, net cash provided by operating activities, or other measures of performance or liquidity we have reported in accordance with GAAP. Our reconciliation of the aggregate amount of Adjusted EBITDA for our reportable segments to consolidated income before income taxes is presented in the table below.

15
Table of Contents

Comcast Corporation

 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Adjusted EBITDA
$
7,099

 
$
6,455

 
$
14,131

 
$
12,822

Depreciation
(1,970
)
 
(1,868
)
 
(3,885
)
 
(3,653
)
Amortization
(571
)
 
(521
)
 
(1,158
)
 
(1,014
)
Other income (expense) items, net
(659
)
 
(708
)
 
(1,284
)
 
(1,262
)
Income before income taxes
$
3,899

 
$
3,358

 
$
7,804

 
$
6,893

Note 12: Condensed Consolidating Financial Information
Comcast (“Comcast Parent”), Comcast Cable Communications, LLC (“CCCL Parent”), and NBCUniversal (“NBCUniversal Media Parent”) have fully and unconditionally guaranteed each other’s debt securities, including the Comcast revolving credit facility.
Comcast Parent and CCCL Parent also fully and unconditionally guarantee NBCUniversal Enterprise’s $4.8 billion aggregate principal amount of senior notes, $1.5 billion revolving credit facility and commercial paper program. NBCUniversal Media Parent does not guarantee the NBCUniversal Enterprise senior notes, revolving credit facility or commercial paper program.
Comcast Parent provides an unconditional subordinated guarantee of the $185 million principal amount currently outstanding of Comcast Holdings’ ZONES due October 2029. Comcast Parent also provides an unconditional guarantee of the Universal Studios Japan ¥450 billion term loan with a final maturity of March 2022. Neither CCCL Parent nor NBCUniversal Media Parent guarantee the Comcast Holdings’ ZONES due October 2029. None of Comcast Parent, CCCL Parent nor NBCUniversal Media Parent guarantee the $62 million principal amount currently outstanding of Comcast Holdings’ ZONES due November 2029.

16
Table of Contents

Comcast Corporation

Condensed Consolidating Balance Sheet
June 30, 2017
(in millions)
Comcast
Parent
Comcast
Holdings
CCCL
Parent
NBCUniversal
Media Parent
Non-
Guarantor
Subsidiaries
Elimination
and
Consolidation
Adjustments
Consolidated
Comcast
Corporation
Assets







Cash and cash equivalents
$
—

$
—

$
—

$
310

$
2,383

$
—

$
2,693

Receivables, net
—

—

—

—

7,849

—

7,849

Programming rights
—

—

—

—

1,633

—

1,633

Other current assets
67

—

—

21

2,569

—

2,657

Total current assets
67

—

—

331

14,434

—

14,832

Film and television costs
—

—

—

—

6,595

—

6,595

Investments
96

1

15

690

5,719

—

6,521

Investments in and amounts due from subsidiaries eliminated upon consolidation
101,430

126,187

124,549

49,038

110,545

(511,749
)
—

Property and equipment, net
434

—

—

—

36,737

—

37,171

Franchise rights
—

—

—

—

59,364

—

59,364

Goodwill
—

—

—

—

36,742

—

36,742

Other intangible assets, net
11

—

—

—

18,896

—

18,907

Other noncurrent assets, net
1,149

658

—

83

2,035

(1,026
)
2,899

Total assets
$
103,187

$
126,846

$
124,564

$
50,142

$
291,067

$
(512,775
)
$
183,031

Liabilities and Equity







Accounts payable and accrued expenses related to trade creditors
$
12

$
—

$
—

$
—

$
6,718

$
—

$
6,730

Accrued participations and residuals
—

—

—

—

1,882

—

1,882

Accrued expenses and other current liabilities
1,887

92

295

286

4,746

—

7,306

Current portion of long-term debt
4,032

—

—

4

2,322

—

6,358

Total current liabilities
5,931

92

295

290

15,668

—

22,276

Long-term debt, less current portion
39,725

142

2,100

8,204

7,039

—

57,210

Deferred income taxes
—

508

—

70

35,886

(1,055
)
35,409

Other noncurrent liabilities
2,526

—

—

1,111

7,171

29

10,837

Redeemable noncontrolling interests and redeemable subsidiary preferred stock
—

—

—

—

1,451

—

1,451

Equity:







Common stock
56

—

—

—

—

—

56

Other shareholders’ equity
54,949

126,104

122,169

40,467

223,009

(511,749
)
54,949

Total Comcast Corporation shareholders’ equity
55,005

126,104

122,169

40,467

223,009

(511,749
)
55,005

Noncontrolling interests
—

—

—

—

843

—

843

Total equity
55,005

126,104

122,169

40,467

223,852

(511,749
)
55,848

Total liabilities and equity
$
103,187

$
126,846

$
124,564

$
50,142

$
291,067

$
(512,775
)
$
183,031


17
Table of Contents

Comcast Corporation

Condensed Consolidating Balance Sheet
December 31, 2016
(in millions)
Comcast
Parent
Comcast
Holdings
CCCL
Parent
NBCUniversal
Media Parent
Non-
Guarantor
Subsidiaries
Elimination
and
Consolidation
Adjustments
Consolidated
Comcast
Corporation
Assets
 
 
 
 
 
 
 
Cash and cash equivalents
$
—

$
—

$
—

$
482

$
2,819

$
—

$
3,301

Receivables, net
—

—

—

—

7,955

—

7,955

Programming rights
—

—

—

—

1,250

—

1,250

Other current assets
151

—

—

36

3,668

—

3,855

Total current assets
151

—

—

518

15,692

—

16,361

Film and television costs
—

—

—

—

7,252

—

7,252

Investments
75

—

—

651

4,521

—

5,247

Investments in and amounts due from subsidiaries eliminated upon consolidation
98,350

120,071

117,696

47,393

97,704

(481,214
)
—

Property and equipment, net
298

—

—

—

35,955

—

36,253

Franchise rights
—

—

—

—

59,364

—

59,364

Goodwill
—

—

—

—

35,980

—

35,980

Other intangible assets, net
13

—

—

—

17,261

—

17,274

Other noncurrent assets, net
1,138

638

—

89

1,921

(1,017
)
2,769

Total assets
$
100,025

$
120,709

$
117,696

$
48,651

$
275,650

$
(482,231
)
$
180,500

Liabilities and Equity
 
 
 
 
 
 
 
Accounts payable and accrued expenses related to trade creditors
$
23

$
—

$
—

$
—

$
6,892

$
—

$
6,915

Accrued participations and residuals
—

—

—

—

1,726

—

1,726

Accrued expenses and other current liabilities
1,726

—

341

302

5,045

—

7,414

Current portion of long-term debt
3,739

—

550

4

1,187

—

5,480

Total current liabilities
5,488

—

891

306

14,850

—

21,535

Long-term debt, less current portion
38,123

141

2,100

8,208

6,994

—

55,566

Deferred income taxes
—

542

—

70

35,259

(1,017
)
34,854

Other noncurrent liabilities
2,471

—

—

1,166

7,288

—

10,925

Redeemable noncontrolling interests and redeemable subsidiary preferred stock
—

—

—

—

1,446

—

1,446

Equity:
 
 
 
 
 
 
 
Common stock
56

—

—

—

—

—

56

Other shareholders’ equity
53,887

120,026

114,705

38,901

207,582

(481,214
)
53,887

Total Comcast Corporation shareholders’ equity
53,943

120,026

114,705

38,901

207,582

(481,214
)
53,943

Noncontrolling interests
—

—

—

—

2,231

—

2,231

Total equity
53,943

120,026

114,705

38,901

209,813

(481,214
)
56,174

Total liabilities and equity
$
100,025

$
120,709

$
117,696

$
48,651

$
275,650

$
(482,231
)
$
180,500

 


18
Table of Contents

Comcast Corporation

Condensed Consolidating Statement of Income
For the Three Months Ended June 30, 2017 
(in millions)
Comcast
Parent
Comcast
Holdings
CCCL
Parent
NBCUniversal
Media Parent
Non-
Guarantor
Subsidiaries
Elimination
and
Consolidation
Adjustments
Consolidated
Comcast
Corporation
Revenue:
 
 
 
 
 
 
 
Service revenue
$
—

$
—

$
—

$
—

$
21,165

$
—

$
21,165

Management fee revenue
281

—

277

—

—

(558
)
—

 
281

—

277

—

21,165

(558
)
21,165

Costs and Expenses:
 
 
 
 
 
 
 
Programming and production
—

—

—

—

6,341

—

6,341

Other operating and administrative
200

—

277

261

5,880

(558
)
6,060

Advertising, marketing and promotion
—

—

—

—

1,665

—

1,665

Depreciation
7

—

—

—

1,963

—

1,970

Amortization
1

—

—

—

570

—

571

 
208

—

277

261

16,419

(558
)
16,607

Operating income (loss)
73

—

—

(261
)
4,746

—

4,558

Other Income (Expense):
 
 
 
 
 
 
 
Interest expense
(531
)
(3
)
(51
)
(116
)
(57
)
—

(758
)
Investment income (loss), net
—

24

—

(16
)
56

—

64

Equity in net income (losses) of investees, net
2,811

2,613

2,301

1,659

1,291

(10,660
)
15

Other income (expense), net
—

—

—

18

2

—

20

 
2,280

2,634

2,250

1,545

1,292

(10,660
)
(659
)
Income (loss) before income taxes
2,353

2,634

2,250

1,284

6,038

(10,660
)
3,899

Income tax (expense) benefit
160

(7
)
18

(8
)
(1,527
)
—

(1,364
)
Net income (loss)
2,513

2,627

2,268

1,276

4,511

(10,660
)
2,535

Net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock
—

—

—

—

(22
)
—

(22
)
Net income (loss) attributable to Comcast Corporation
$
2,513

$
2,627

$
2,268

$
1,276

$
4,489

$
(10,660
)
$
2,513

Comprehensive income (loss) attributable to Comcast Corporation
$
2,405

$
2,591

$
2,269

$
1,120

$
4,246

$
(10,226
)
$
2,405


19
Table of Contents

Comcast Corporation

Condensed Consolidating Statement of Income
For the Three Months Ended June 30, 2016
(in millions)
Comcast
Parent
Comcast
Holdings
CCCL
Parent
NBCUniversal
Media Parent
Non-
Guarantor
Subsidiaries
Elimination
and
Consolidation
Adjustments
Consolidated
Comcast
Corporation
Revenue:
 
 
 
 
 
 
 
Service revenue
$
—

$
—

$
—

$
—

$
19,269

$
—

$
19,269

Management fee revenue
266

—

261

—

—

(527
)
—

 
266

—

261

—

19,269

(527
)
19,269

Costs and Expenses:
 
 
 
 
 
 
 
Programming and production
—

—

—

—

5,492

—

5,492

Other operating and administrative
285

—

261

222

5,522

(527
)
5,763

Advertising, marketing and promotion
—

—

—

—

1,559

—

1,559

Depreciation
6

—

—

—

1,862

—

1,868

Amortization
2

—

—

—

519

—

521

 
293

—

261

222

14,954

(527
)
15,203

Operating income (loss)
(27
)
—

—

(222
)
4,315

—

4,066

Other Income (Expense):
 
 
 
 
 
 
 
Interest expense
(478
)
(3
)
(61
)
(112
)
(78
)
—

(732
)
Investment income (loss), net
3

1

—

(6
)
60

—

58

Equity in net income (losses) of investees, net
2,354

2,275

2,127

1,288

914

(8,977
)
(19
)
Other income (expense), net
—

—

—

(7
)
(8
)
—

(15
)
 
1,879

2,273

2,066

1,163

888

(8,977
)
(708
)
Income (loss) before income taxes
1,852

2,273

2,066

941

5,203

(8,977
)
3,358

Income tax (expense) benefit
176

1

21

(8
)
(1,468
)
—

(1,278
)
Net income (loss)
2,028

2,274

2,087

933

3,735

(8,977
)
2,080

Net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock
—

—

—

—

(52
)
—

(52
)
Net income (loss) attributable to Comcast Corporation
$
2,028

$
2,274

$
2,087

$
933

$
3,683

$
(8,977
)
$
2,028

Comprehensive income (loss) attributable to Comcast Corporation
$
2,113

$
2,321

$
2,087

$
1,096

$
4,194

$
(9,698
)
$
2,113


20
Table of Contents

Comcast Corporation

Condensed Consolidating Statement of Income
For the Six Months Ended June 30, 2017
(in millions)
Comcast
Parent
Comcast
Holdings
CCCL
Parent
NBCUniversal
Media Parent
Non-
Guarantor
Subsidiaries
Elimination
and
Consolidation
Adjustments
Consolidated
Comcast
Corporation
Revenue:
 
 
 
 
 
 
 
Service revenue
$
—

$
—

$
—

$
—

$
41,628

$
—

$
41,628

Management fee revenue
556

—

547

—

—

(1,103
)
—

 
556

—

547

—

41,628

(1,103
)
41,628

Costs and Expenses:
 
 
 
 
 
 
 
Programming and production
—

—

—

—

12,415

—

12,415

Other operating and administrative
370

—

547

567

11,506

(1,103
)
11,887

Advertising, marketing and promotion
—

—

—

—

3,195

—

3,195

Depreciation
14

—

—

—

3,871

—

3,885

Amortization
3

—

—

—

1,155

—

1,158

 
387

—

547

567

32,142

(1,103
)
32,540

Operating income (loss)
169

—

—

(567
)
9,486

—

9,088

Other Income (Expense):
 
 
 
 
 
 
 
Interest expense
(1,048
)
(6
)
(111
)
(228
)
(120
)
—

(1,513
)
Investment income (loss), net
1

52

—

(20
)
90

—

123

Equity in net income (losses) of investees, net
5,650

5,263

4,621

3,256

2,527

(21,266
)
51

Other income (expense), net
—

—

—

46

9

—

55

 
4,603

5,309

4,510

3,054

2,506

(21,266
)
(1,284
)
Income (loss) before income taxes
4,772

5,309

4,510

2,487

11,992

(21,266
)
7,804

Income tax (expense) benefit
307

(16
)
39

(11
)
(2,941
)
—

(2,622
)
Net income (loss)
5,079

5,293

4,549

2,476

9,051

(21,266
)
5,182

Net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock
—

—

—

—

(103
)
—

(103
)
Net income (loss) attributable to Comcast Corporation
$
5,079

$
5,293

$
4,549

$
2,476

$
8,948

$
(21,266
)
$
5,079

Comprehensive income (loss) attributable to Comcast Corporation
$
5,215

$
5,307

$
4,551

$
2,526

$
8,949

$
(21,333
)
$
5,215



21
Table of Contents

Comcast Corporation

Condensed Consolidating Statement of Income
For the Six Months Ended June 30, 2016 
(in millions)
Comcast
Parent
Comcast
Holdings
CCCL
Parent
NBCUniversal
Media Parent
Non-
Guarantor
Subsidiaries
Elimination
and
Consolidation
Adjustments
Consolidated
Comcast
Corporation
Revenue:
 
 
 
 
 
 
 
Service revenue
$
—

$
—

$
—

$
—

$
38,059

$
—

$
38,059

Management fee revenue
525

—

515

—

—

(1,040
)
—

 
525

—

515

—

38,059

(1,040
)
38,059

Costs and Expenses:
 
 
 
 
 
 
 
Programming and production
—

—

—

—

10,923

—

10,923

Other operating and administrative
441

—

515

517

10,856

(1,040
)
11,289

Advertising, marketing and promotion
—

—

—

—

3,025

—

3,025

Depreciation
14

—

—

—

3,639

—

3,653

Amortization
3

—

—

—

1,011

—

1,014

 
458

—

515

517

29,454

(1,040
)
29,904

Operating income (loss)
67

—

—

(517
)
8,605

—

8,155

Other Income (Expense):
 
 
 
 
 
 
 
Interest expense
(929
)
(6
)
(120
)
(229
)
(151
)
—

(1,435
)
Investment income (loss), net
3

1

—

(8
)
92

—

88

Equity in net income (losses) of investees, net
4,720

4,539

4,241

2,585

1,905

(18,020
)
(30
)
Other income (expense), net
—

—

—

117

(2
)
—

115

 
3,794

4,534

4,121

2,465

1,844

(18,020
)
(1,262
)
Income (loss) before income taxes
3,861

4,534

4,121

1,948

10,449

(18,020
)
6,893

Income tax (expense) benefit
301

2

42

(13
)
(2,921
)
—

(2,589
)
Net income (loss)
4,162

4,536

4,163

1,935

7,528

(18,020
)
4,304

Net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock
—

—

—

—

(142
)
—

(142
)
Net income (loss) attributable to Comcast Corporation
$
4,162

$
4,536

$
4,163

$
1,935

$
7,386

$
(18,020
)
$
4,162

Comprehensive income (loss) attributable to Comcast Corporation
$
4,337

$
4,627

$
4,165

$
2,242

$
7,899

$
(18,933
)
$
4,337



22
Table of Contents

Comcast Corporation

Condensed Consolidating Statement of Cash Flows
For the Six Months Ended June 30, 2017 
(in millions)
Comcast
Parent
Comcast
Holdings
CCCL
Parent
NBCUniversal
Media Parent
Non-
Guarantor
Subsidiaries
Elimination
and
Consolidation
Adjustments
Consolidated
Comcast
Corporation
Net cash provided by (used in) operating activities
$
(465
)
$
102

$
(116
)
$
(776
)
$
12,069

$
—

$
10,814

Investing Activities
 
 
 
 
 
 
 
Net transactions with affiliates
2,559

(102
)
666

605

(3,728
)
—

—

Capital expenditures
(3
)
—

—

—

(4,402
)
—

(4,405
)
Cash paid for intangible assets
(2
)
—

—

—

(834
)
—

(836
)
Acquisitions and construction of real estate properties
(143
)
—

—

—

(107
)
—

(250
)
Acquisitions, net of cash acquired
—

—

—

—

(398
)
—

(398
)
Proceeds from sales of investments
—

—

—

10

47

—

57

Purchases of investments
(20
)
—

—

(57
)
(1,748
)
—

(1,825
)
Other
101

—

—

49

20

—

170

Net cash provided by (used in) investing activities
2,492

(102
)
666

607

(11,150
)
—

(7,487
)
Financing Activities
 
 
 
 
 
 
 
Proceeds from (repayments of) short-term borrowings, net
(627
)
—

—

—

(1,068
)
—

(1,695
)
Proceeds from borrowings
3,500

—

—

—

5,463

—

8,963

Repurchases and repayments of debt
(1,000
)
—

(550
)
(3
)
(3,414
)
—

(4,967
)
Repurchases of common stock under repurchase program and employee plans
(2,476
)
—

—

—

—

—

(2,476
)
Dividends paid
(1,404
)
—

—

—

—

—

(1,404
)
Purchase of Universal Studios Japan noncontrolling interests
—

—

—

—

(2,299
)
—

(2,299
)
Issuances of common stock
—

—

—

—

—

—

—

Distributions to noncontrolling interests and dividends for redeemable subsidiary preferred stock
—

—

—

—

(137
)
—

(137
)
Other
(20
)
—

—

—

100

—

80

Net cash provided by (used in) financing activities
(2,027
)
—

(550
)
(3
)
(1,355
)
—

(3,935
)
Increase (decrease) in cash and cash equivalents
—

—

—

(172
)
(436
)
—

(608
)
Cash and cash equivalents, beginning of period
—

—

—

482

2,819

—

3,301

Cash and cash equivalents, end of period
$
—

$
—

$
—

$
310

$
2,383

$
—

$
2,693



23
Table of Contents

Comcast Corporation

Condensed Consolidating Statement of Cash Flows
For the Six Months Ended June 30, 2016
(in millions)
Comcast
Parent
Comcast
Holdings
CCCL
Parent
NBCUniversal
Media Parent
Non-
Guarantor
Subsidiaries
Elimination
and
Consolidation
Adjustments
Consolidated
Comcast
Corporation
Net cash provided by (used in) operating activities
$
(367
)
$
—

$
(84
)
$
(809
)
$
11,054

$
—

$
9,794

Investing Activities
 
 
 
 
 
 
 
Net transactions with affiliates
880

—

84

1,579

(2,543
)
—

—

Capital expenditures
(7
)
—

—

—

(4,149
)
—

(4,156
)
Cash paid for intangible assets
(3
)
—

—

—

(734
)
—

(737
)
Acquisitions and construction of real estate properties
—

—

—

—

(211
)
—

(211
)
Acquisitions, net of cash acquired
—

—

—

—

(126
)
—

(126
)
Proceeds from sales of investments
—

—

—

102

36

—

138

Purchases of investments
(15
)
—

—

(2
)
(563
)
—

(580
)
Other
(164
)
—

—

(35
)
43

—

(156
)
Net cash provided by (used in) investing activities
691

—

84

1,644

(8,247
)
—

(5,828
)
Financing Activities
 
 
 
 
 
 
 
Proceeds from (repayments of) short-term borrowings, net
(400
)
—

—

—

605

—

205

Proceeds from borrowings
4,753

—

—

—

—

—

4,753

Repurchases and repayments of debt
(750
)
—

—

(1,004
)
(797
)
—

(2,551
)
Repurchases of common stock under repurchase program and employee plans
(2,636
)
—

—

—

—

—

(2,636
)
Dividends paid
(1,281
)
—

—

—

—

—

(1,281
)
Issuances of common stock
19

—

—

—

—

—

19

Distributions to noncontrolling interests and dividends for redeemable subsidiary preferred stock
—

—

—

—

(125
)
—

(125
)
Other
(29
)
—

—

25

24

—

20

Net cash provided by (used in) financing activities
(324
)
—

—

(979
)
(293
)
—

(1,596
)
Increase (decrease) in cash and cash equivalents
—

—

—

(144
)
2,514

—

2,370

Cash and cash equivalents, beginning of period
—

—

—

414

1,881

—

2,295

Cash and cash equivalents, end of period
$
—

$
—

$
—

$
270

$
4,395

$
—

$
4,665




24
Table of Contents

ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
We are a global media and technology company with two primary businesses, Comcast Cable and NBCUniversal. We present our operations for Comcast Cable in one reportable business segment, referred to as Cable Communications, and our operations for NBCUniversal in four reportable business segments: Cable Networks, Broadcast Television, Filmed Entertainment and Theme Parks (collectively, the “NBCUniversal segments”).
Cable Communications Segment
Comcast Cable is one of the nation’s largest providers of video, high-speed Internet, voice, and security and automation services (“cable services”) to residential customers under the XFINITY brand; we also provide these and other services to business customers and sell advertising. As of June 30, 2017, our cable systems had 29.0 million total customer relationships, including 26.9 million residential and 2.1 million business customer relationships, and passed more than 56 million homes and businesses. Our Cable Communications segment generates revenue primarily from residential and business customers that subscribe to our cable services, which we market individually and as bundled services, and from the sale of advertising. During the six months ended June 30, 2017, our Cable Communications segment generated 61% of our consolidated revenue and 70% of the aggregate Adjusted EBITDA for our reportable business segments.
NBCUniversal Segments
NBCUniversal is one of the world’s leading media and entertainment companies that develops, produces and distributes entertainment, news and information, sports, and other content for global audiences, and owns and operates theme parks worldwide.
Cable Networks
Our Cable Networks segment consists primarily of a diversified portfolio of cable television networks. Our cable networks are comprised of our national cable networks that provide a variety of entertainment, news and information, and sports content; our regional sports and news networks; our international cable networks; our cable television studio production operations; and related digital media properties. Our Cable Networks segment generates revenue primarily from the distribution of our cable network programming to traditional and virtual multichannel video providers, from the sale of advertising on our cable networks and related digital media properties, from the licensing of our owned programming, including programming from our cable television studio production operations, to cable and broadcast networks and subscription video on demand services, and from the sale of our owned programming on standard-definition digital video discs and Blu-ray discs (together, “DVDs”) and through digital distribution services such as iTunes.
Broadcast Television
Our Broadcast Television segment consists primarily of the NBC and Telemundo broadcast networks, our NBC and Telemundo owned local broadcast television stations, the NBC Universo national cable network, our broadcast television studio production operations, and related digital media properties. Our Broadcast Television segment generates revenue primarily from the sale of advertising on our broadcast networks, owned local broadcast television stations and related digital media properties; from the licensing of our owned programming by our broadcast television studio production operations to various distribution platforms, including to cable and broadcast networks as well as to subscription video on demand services; from the fees received under retransmission consent agreements and associated fees received from NBC-affiliated local broadcast television stations; and from the sale of our owned programming on DVDs and through digital distribution services.
Filmed Entertainment
Our Filmed Entertainment segment primarily produces, acquires, markets and distributes filmed entertainment worldwide, and it also develops, produces and licenses live stage plays. Our films are produced primarily under the Universal Pictures, Illumination, Focus Features and DreamWorks Animation names. Our Filmed Entertainment segment generates revenue primarily from the worldwide distribution of our produced and acquired films for exhibition in movie theaters, from the licensing of produced and acquired films through various distribution platforms, and from the sale of produced and acquired films on DVDs and through digital distribution services. Our Filmed Entertainment segment also generates revenue from producing and licensing live stage plays, from the distribution of filmed entertainment produced by third parties, and from Fandango, our movie ticketing and entertainment business.

25
Table of Contents

Theme Parks
Our Theme Parks segment consists primarily of our Universal theme parks in Orlando, Florida; Hollywood, California; and Osaka, Japan. In addition, along with a consortium of Chinese state-owned companies, we are developing a theme park in China. Our Theme Parks segment generates revenue primarily from ticket sales and guest spending at our Universal theme parks.
Corporate and Other
Our other business interests consist primarily of the operations of Comcast Spectacor, which owns the Philadelphia Flyers and the Wells Fargo Center arena in Philadelphia, Pennsylvania and operates arena management-related businesses.
We are also pursuing other business initiatives, such as our wireless phone service that we launched in the second quarter of 2017 on a small scale to our residential cable customers using our virtual network operator rights to provide the service over Verizon’s wireless network and our existing network of in-home and outdoor Wi-Fi hotspots. We offer the wireless phone service only as part of our bundled service offerings to residential customers subscribing to our high-speed Internet service within our cable distribution footprint and may in the future also offer wireless phone service to our small business customers on similar terms. The wireless phone service has success-based working capital requirements, primarily associated with the procurement of handsets, which customers are able to pay for upfront or finance interest-free over 24 months, and other equipment. 
Competition
The results of operations of our reportable business segments are affected by competition, as all of our businesses operate in intensely competitive, consumer-driven and rapidly changing environments and compete with a growing number of companies that provide a broad range of communications products and services and entertainment, news and information content to consumers. For additional information on the competition our businesses face, see Item 1: Business included in our 2016 Annual Report on Form 10-K and refer to the “Competition” discussion within that section and see Item 1A: Risk Factors included in our 2016 Annual Report on Form 10-K and refer to the risk factors within that section entitled “Our businesses currently face a wide range of competition, and our businesses and results of operations could be adversely affected if we do not compete effectively” and “Changes in consumer behavior driven by new technologies and distribution platforms for viewing content may adversely affect our businesses and challenge existing business models.”
Seasonality and Cyclicality
Each of our businesses is subject to seasonal and cyclical variations. In our Cable Communications segment, our results are impacted by the seasonal nature of customers receiving our cable services in college and vacation markets. This generally results in a reduction in net customer additions in the second quarter and an increase in net customer additions in the third and fourth quarters of each year.
Revenue in our Cable Communications, Cable Networks and Broadcast Television segments is subject to cyclical advertising patterns and changes in viewership levels. Advertising revenue in the U.S. is generally higher in the second and fourth quarters of each year, due in part to increases in consumer advertising in the spring and in the period leading up to and including the holiday season. Advertising revenue in the U.S. is also cyclical, with a benefit in even-numbered years due to advertising related to candidates running for political office and issue-oriented advertising. Revenue in our Cable Networks and Broadcast Television segments fluctuates depending on the timing of when our programming is aired, which typically results in higher advertising revenue in the second and fourth quarters of each year. Our revenue and operating costs and expenses, excluding depreciation and amortization (“operating costs and expenses”) are cyclical as a result of our periodic broadcasts of major sporting events, such as the Olympic Games, which affect our Cable Networks and Broadcast Television segments, and the Super Bowl, which affects our Broadcast Television segment. Our advertising revenue increases in the period of these broadcasts due to increased demand for advertising time, and our operating costs and expenses also increase as a result of our production costs and the amortization of the related rights fees.
Revenue in our Filmed Entertainment segment fluctuates due to the timing of the release of films in movie theaters, on DVDs and through various other distribution platforms. Release dates are determined by several factors, including competition and the timing of vacation and holiday periods. As a result, revenue tends to be seasonal, with increases experienced each year during the summer months and around the holiday season. Revenue in our Cable Networks, Broadcast Television and Filmed Entertainment segments also fluctuates due to the timing of when our content is made available to licensees.
Revenue in our Theme Parks segment fluctuates with changes in theme park attendance that result from the seasonal nature of vacation travel and weather variations, local entertainment offerings and the opening of new attractions, as well as with changes in currency exchange rates. Our theme parks generally experience peak attendance during the spring holiday period, the summer months when schools are closed and the holiday season.

26
Table of Contents

Consolidated Operating Results
 
Three Months Ended
June 30
 
Increase/
(Decrease)
 
Six Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
  

 
2017
 
2016
 
  

Revenue
$
21,165

 
$
19,269

 
9.8
 %
 
$
41,628

 
$
38,059

 
9.4
 %
Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Programming and production
6,341

 
5,492

 
15.5

 
12,415

 
10,923

 
13.7

Other operating and administrative
6,060

 
5,763

 
5.2

 
11,887

 
11,289

 
5.3

Advertising, marketing and promotion
1,665

 
1,559

 
6.8

 
3,195

 
3,025

 
5.6

Depreciation
1,970

 
1,868

 
5.5

 
3,885

 
3,653

 
6.4

Amortization
571

 
521

 
9.5

 
1,158

 
1,014

 
14.1

Operating income
4,558

 
4,066

 
12.1

 
9,088

 
8,155

 
11.4

Other income (expense) items, net
(659
)
 
(708
)
 
(7.0
)
 
(1,284
)
 
(1,262
)
 
1.8

Income before income taxes
3,899

 
3,358

 
16.1

 
7,804

 
6,893

 
13.2

Income tax expense
(1,364
)
 
(1,278
)
 
6.8

 
(2,622
)
 
(2,589
)
 
1.3

Net income
2,535

 
2,080

 
21.9

 
5,182

 
4,304

 
20.4

Net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock
(22
)
 
(52
)
 
(58.7
)
 
(103
)
 
(142
)
 
(27.9
)
Net income attributable to Comcast Corporation
$
2,513

 
$
2,028

 
23.9
 %
 
$
5,079

 
$
4,162

 
22.0
 %
All percentages are calculated based on actual amounts. Minor differences may exist due to rounding.
Consolidated Revenue
All of our reportable business segments accounted for the increases in consolidated revenue for the three and six months ended June 30, 2017.
Revenue for our segments is discussed separately below under the heading “Segment Operating Results.” Revenue for our other businesses is discussed separately below under the heading “Corporate and Other Results of Operations.”
Consolidated Costs and Expenses
Our Cable Communications, Broadcast Television, Filmed Entertainment and Theme Parks segments accounted for substantially all of the increases in consolidated operating costs and expenses for the three and six months ended June 30, 2017.
Operating costs and expenses for our segments are discussed separately below under the heading “Segment Operating Results.” Operating costs and expenses for our corporate and other businesses and initiatives are discussed separately below under the heading “Corporate and Other Results of Operations.”
Consolidated Depreciation and Amortization
 
Three Months Ended
June 30
 
Increase/
(Decrease)
 
Six Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
  
 
2017
 
2016
 
  
Cable Communications
$
2,001

 
$
1,904

 
5.1
 %
 
$
3,981

 
$
3,747

 
6.2
 %
NBCUniversal
520

 
465

 
11.9

 
1,028

 
879

 
17.0

Corporate and Other
20

 
20

 
(1.5
)
 
34

 
41

 
(18.6
)
Total
$
2,541

 
$
2,389

 
6.4
 %
 
$
5,043

 
$
4,667

 
8.1
 %
Consolidated depreciation and amortization expense increased for the three and six months ended June 30, 2017 primarily due to increases in capital expenditures, as well as expenditures for software in our Cable Communications segment in recent years. We continue to invest to increase our network capacity and in customer premise equipment, primarily for our X1 platform, cloud DVR technology and wireless gateways. These assets generally have shorter estimated useful lives, which is also a contributor to our increase in depreciation expense for the three and six months ended June 30, 2017. NBCUniversal depreciation and amortization expense also increased for the three and six months ended June 30, 2017 due to our investments in new attractions in our Theme Parks segment.

27
Table of Contents

Segment Operating Results
Our segment operating results are presented based on how we assess operating performance and internally report financial information. We use Adjusted EBITDA (formerly referred to as operating income before depreciation and amortization) as the measure of profit or loss for our operating segments. Adjusted EBITDA is defined as net income attributable to Comcast Corporation before net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock, income tax expense, other income (expense) items, net and depreciation and amortization, and excluding impairment charges related to fixed and intangible assets and gains or losses on the sale of long-lived assets, if any. Other income (expense) items, net include interest expense, investment income (loss), equity in net income (losses) of investees and other income (expense), net, as stated in our condensed consolidated statement of income. 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. Additionally, it is unaffected by our capital and tax structures and by our investment activities. We use this 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. We believe that this measure 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 may not be directly comparable to similar measures used by other companies. We reconcile the aggregate amount of Adjusted EBITDA for our reportable segments to consolidated income before income taxes in the business segment footnote to our condensed consolidated financial statements (see Note 11 to Comcast’s condensed consolidated financial statements and Note 10 to NBCUniversal’s condensed consolidated financial statements). This measure should not be considered a substitute for operating income (loss), net income (loss), net income (loss) attributable to Comcast Corporation or NBCUniversal, net cash provided by operating activities, or other measures of performance or liquidity we have reported in accordance with generally accepted accounting principles in the United States.
To be consistent with our current management reporting presentation, certain 2016 operating results were reclassified within the Cable Communications segment.
Cable Communications Segment Results of Operations
 
Three Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
 
%
Revenue
 
 
 
 
 
 
 
Residential:
 
 
 
 
 
 
 
Video
$
5,797

 
$
5,581

 
$
216

 
3.9
 %
High-speed Internet
3,679

 
3,369

 
310

 
9.2

Voice
856

 
893

 
(37
)
 
(4.1
)
Business services
1,531

 
1,360

 
171

 
12.6

Advertising
574

 
586

 
(12
)
 
(2.1
)
Other
685

 
655

 
30

 
5.0

Total revenue
13,122

 
12,444

 
678

 
5.5

Operating costs and expenses
 
 
 
 
 
 
 
Programming
3,206

 
2,863

 
343

 
12.0

Technical and product support
1,585

 
1,556

 
29

 
1.8

Customer service
607

 
614

 
(7
)
 
(1.1
)
Advertising, marketing and promotion
895

 
876

 
19

 
2.1

Franchise and other regulatory fees
382

 
370

 
12

 
3.3

Other
1,127

 
1,117

 
10

 
1.0

Total operating costs and expenses
7,802

 
7,396

 
406

 
5.5

Adjusted EBITDA
$
5,320

 
$
5,048

 
$
272

 
5.4
 %


28
Table of Contents

 
Six Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
 
%
Revenue
 
 
 
 
 
 
 
Residential:
 
 
 
 
 
 
 
Video
$
11,571

 
$
11,119

 
$
452

 
4.1
 %
High-speed Internet
7,285

 
6,644

 
641

 
9.6

Voice
1,719

 
1,789

 
(70
)
 
(3.9
)
Business services
3,021

 
2,671

 
350

 
13.1

Advertising
1,086

 
1,132

 
(46
)
 
(4.1
)
Other
1,352

 
1,293

 
59

 
4.7

Total revenue
26,034

 
24,648

 
1,386

 
5.6

Operating costs and expenses

 

 

 

Programming
6,434

 
5,754

 
680

 
11.8

Technical and product support
3,145

 
3,074

 
71

 
2.3

Customer service
1,228

 
1,242

 
(14
)
 
(1.1
)
Advertising, marketing and promotion
1,754

 
1,712

 
42

 
2.4

Franchise and other regulatory fees
763

 
735

 
28

 
3.8

Other
2,192

 
2,194

 
(2
)
 
—

Total operating costs and expenses
15,516

 
14,711

 
805

 
5.5

Adjusted EBITDA
$
10,518

 
$
9,937

 
$
581

 
5.8
 %
Customer Metrics
 
Total Customers
Net Additional Customers
 
June 30
Three Months Ended
June 30
Six Months Ended
June 30
(in thousands, except per customer amounts)
2017
2016
2017
2016
2017
2016
Video
 
 
 
 
 
 
Video residential customers
21,475

21,401

(45
)
(21
)
(13
)
17

Video business services customers
1,040

994

11

17

21

32

Total video customers
22,516

22,396

(34
)
(4
)
8

49

High-Speed Internet
 
 
 
 
 
 
High-speed Internet residential customers
23,364

22,189

140

176

537

579

High-speed Internet business services customers
1,942

1,797

35

43

67

79

Total high-speed Internet customers
25,306

23,987

175

220

604

658

Voice
 
 
 
 
 
 
Voice residential customers
10,470

10,551

(50
)
35

(76
)
114

Voice business services customers
1,189

1,090

27

29

49

51

Total voice customers
11,659

11,641

(22
)
64

(28
)
165

Security and Automation
 
 
 
 
 
 
Security and automation customers
1,028

737

71

70

137

125

 
 
 
 
 
 
 
Customer Relationships
 
 
 
 
 
 
Residential customer relationships
26,874

26,138

77

73

341

310

Business services customer relationships
2,115

1,964

37

43

71

77

Total customer relationships
28,989

28,101

114

116

412

386

Residential customer relationships mix
 
 
 
 
 
 
Single product customers
7,931

7,671

70

(10
)
174

24

Double product customers
8,945

8,585

8

13

148

106

Triple and quad product customers
9,998

9,882

—

70

18

179

Average monthly total revenue per customer relationship
$
151.19

$
147.90

 
 
 
 
Customer metrics are presented based on actual amounts. Minor differences may exist due to rounding. Beginning in 2017, we include prepaid customers, which are customers who prepay for at least 30 days of service, in our customer metrics. Residential video and high-speed Internet customers as of June 30, 2017 included prepaid customers totaling approximately 2,000 and 30,000, respectively. Customer relationships represent the number of residential and business customers that subscribe to at least one of our cable services. Single product, double product, and triple and quad product customers represent residential customers that subscribe to one, two, or three and four of our cable services, respectively. Beginning in 2017, we include customers subscribing to our security and automation services in customer relationship information. All periods presented have been adjusted for the inclusion of security and automation customers.

29
Table of Contents

Cable Communications Segment—Revenue
Video
Video revenue increased 3.9% and 4.1% for the three and six months ended June 30, 2017, respectively, compared to the same periods in 2016. The primary contributors to revenue growth were rate adjustments and increases in the number of residential customers subscribing to additional services such as premium channels and advanced services. These contributors accounted for increases in revenue of 3.5% and 3.6% for the three and six months ended June 30, 2017, respectively. We have in the past, and may in the future, experience declines in the number of residential video customers due to competitive pressures and the impact of rate adjustments. Competition is intense, both from traditional multichannel video providers and from new technologies and distribution platforms for viewing content. We have responded to this competition, and have attempted to mitigate industry-wide declines in residential video customers at traditional multichannel video providers, through our X1 platform and sales and marketing programs, such as promotions, bundled service offerings and service offerings targeted at market segments.
High-Speed Internet
High-speed Internet revenue increased 9.2% and 9.6% for the three and six months ended June 30, 2017, respectively, compared to the same periods in 2016. Increases in the number of residential customers receiving our high-speed Internet services accounted for increases in revenue of 5.4% and 5.5% for the three and six months ended June 30, 2017, respectively. The remaining increases in revenue for the three and six months ended June 30, 2017 were primarily due to increases in the number of customers receiving higher levels of service and the impact of rate adjustments. Our customer base continues to grow as consumers choose our high-speed Internet services and seek higher-speed offerings.
Voice
Voice revenue decreased 4.1% and 3.9% for the three and six months ended June 30, 2017, respectively, compared to the same periods in 2016. The decreases were primarily due to the allocation of voice revenue for our customers who received bundled services. The amount allocated to voice revenue in the rate charged for bundled services decreased for the three and six months ended June 30, 2017 because video and high-speed Internet rates increased while voice rates remained relatively flat.
Business Services
Business services revenue increased 12.6% and 13.1% for the three and six months ended June 30, 2017, respectively, compared to the same periods in 2016. The increases were primarily due to increases in the number of customers receiving our small and medium-sized business services offerings. We believe the increases in the number of business customers are primarily the result of our efforts to gain market share from competitors by offering competitive services and pricing, although the rate of growth in the number of our small business customers may slow as the business matures.
Advertising
Advertising revenue decreased 2.1% and 4.1% for the three and six months ended June 30, 2017, respectively, compared to the same periods in 2016 primarily due to decreases in revenue from core linear advertising markets across several categories and political advertising revenue, which were partially offset by increases in revenue from interactive advertising. Excluding political advertising revenue, advertising revenue decreased 1.0% and 1.6% for the three and six months ended June 30, 2017, respectively, compared to the same periods in 2016.
For both the three and six months ended June 30, 2017, 4% of our Cable Communications segment advertising revenue was generated from our NBCUniversal segments. For the three and six months ended June 30, 2016, 4% and 5%, respectively, of our Cable Communications segment advertising revenue was generated from our NBCUniversal segments. These amounts are eliminated in our condensed consolidated financial statements but are included in the amounts presented above.
Other
Other revenue increased 5.0% and 4.7% for the three and six months ended June 30, 2017, respectively, compared to the same periods in 2016 primarily due to increases in revenue from our security and automation services and increases in cable franchise and other regulatory fees.
Cable Communications Segment—Operating Costs and Expenses
Programming expenses increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to the timing of contract renewals and other increases in programming license fees, including retransmission consent fees and sports programming costs.
Technical and product support expenses increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to expenses related to the development, delivery and support of our X1 platform, cloud DVR technology

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and wireless gateways, and the continued growth in business services and security and automation services. The increases were also due to expenses related to investments to improve the customer experience.
Customer service expenses decreased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to reduced call volumes.
Advertising, marketing and promotion expenses increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to increases in spending associated with attracting new customers and encouraging existing customers to add additional or higher-tier services.
Franchise and other regulatory fees increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to increases in the revenue to which the fees apply.
Other costs and expenses remained relatively flat for the three and six months ended June 30, 2017 compared to the same periods in 2016.
Cable Communications Segment—Operating Margin
Our Cable Communications segment operating margin is Adjusted EBITDA as a percentage of revenue. The most significant operating costs and expenses for our Cable Communications segment are the programming expenses we incur to provide content to our video customers. We expect that our programming expenses will continue to increase, which may negatively impact our operating margin. We will attempt to mitigate increases in operating costs and expenses by growing revenue, particularly in our high-speed Internet, video and business services businesses, and through cost management.
Our operating margin for the three months ended June 30, 2017 and 2016 was 40.5% and 40.6%, respectively. Our operating margin for the six months ended June 30, 2017 and 2016 was 40.4% and 40.3%, respectively.
NBCUniversal Segments Results of Operations
 
Three Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
%
Revenue
 
 
 
 
 
 
Cable Networks
$
2,696

 
$
2,566

 
$
130

5.1
%
Broadcast Television
2,241

 
2,128

 
113

5.3

Filmed Entertainment
2,155

 
1,351

 
804

59.6

Theme Parks
1,314

 
1,136

 
178

15.6

Headquarters, other and eliminations
(75
)
 
(78
)
 
3

NM

Total revenue
$
8,331

 
$
7,103

 
$
1,228

17.3
%
Adjusted EBITDA
 
 
 
 
 
 
Cable Networks
$
1,055

 
$
944

 
$
111

11.7
%
Broadcast Television
416

 
394

 
22

5.5

Filmed Entertainment
285

 
56

 
229

407.4

Theme Parks
551

 
469

 
82

17.3

Headquarters, other and eliminations
(236
)
 
(174
)
 
(62
)
NM

Total Adjusted EBITDA
$
2,071

 
$
1,689

 
$
382

22.6
%

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Six Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
%
Revenue
 
 
 
 
 
 
Cable Networks
$
5,337

 
$
5,019

 
$
318

6.3
%
Broadcast Television
4,449

 
4,212

 
237

5.6

Filmed Entertainment
4,136

 
2,734

 
1,402

51.3

Theme Parks
2,432

 
2,162

 
270

12.5

Headquarters, other and eliminations
(155
)
 
(163
)
 
8

NM

Total revenue
$
16,199

 
$
13,964

 
$
2,235

16.0
%
Adjusted EBITDA
 
 
 
 
 
 
Cable Networks
$
2,171

 
$
1,900

 
$
271

14.2
%
Broadcast Television
738

 
678

 
60

8.8

Filmed Entertainment
653

 
223

 
430

192.7

Theme Parks
948

 
844

 
104

12.3

Headquarters, other and eliminations
(422
)
 
(334
)
 
(88
)
NM

Total Adjusted EBITDA
$
4,088

 
$
3,311

 
$
777

23.5
%
Percentage changes that are considered not meaningful are denoted with NM.
Cable Networks Segment Results of Operations
 
Three Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
%
Revenue
 
 
 
 
 
 
Distribution
$
1,550

 
$
1,434

 
$
116

8.1
 %
Advertising
906

 
914

 
(8
)
(0.9
)
Content licensing and other
240

 
218

 
22

10.5

Total revenue
2,696

 
2,566

 
130

5.1

Operating costs and expenses
 
 
 
 
 
 
Programming and production
1,197

 
1,194

 
3

0.3

Other operating and administrative
325

 
313

 
12

4.1

Advertising, marketing and promotion
119

 
115

 
4

3.6

Total operating costs and expenses
1,641

 
1,622

 
19

1.2

Adjusted EBITDA
$
1,055

 
$
944

 
$
111

11.7
 %
 
Six Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
%
Revenue
 
 
 
 
 
 
Distribution
$
3,112

 
$
2,872

 
$
240

8.3
 %
Advertising
1,732

 
1,765

 
(33
)
(1.9
)
Content licensing and other
493

 
382

 
111

29.2

Total revenue
5,337

 
5,019

 
318

6.3

Operating costs and expenses
 
 
 
 
 
 
Programming and production
2,280

 
2,252

 
28

1.3

Other operating and administrative
646

 
620

 
26

4.2

Advertising, marketing and promotion
240

 
247

 
(7
)
(2.8
)
Total operating costs and expenses
3,166

 
3,119

 
47

1.5

Adjusted EBITDA
$
2,171

 
$
1,900

 
$
271

14.2
 %
Cable Networks Segment—Revenue
Cable Networks revenue increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 due to increases in distribution revenue and content licensing and other revenue, which were partially offset by decreases in advertising revenue. The increases in distribution revenue were primarily due to increases in the contractual rates charged under distribution agreements and the timing of contract renewals, which were partially offset by a decline in the number of subscribers at our cable networks. The increases in content licensing and other revenue were primarily due to the timing of content provided under our

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licensing agreements. The decreases in advertising revenue were primarily due to the impact of continued declines in audience ratings at our networks, which were partially offset by higher prices for advertising units sold.
For both the three and six months ended June 30, 2017, 15% of our Cable Networks segment revenue was generated from our Cable Communications segment. For both the three and six months ended June 30, 2016, 14% of our Cable Networks segment revenue was generated from our Cable Communications segment. These amounts are eliminated in our condensed consolidated financial statements but are included in the amounts presented above.
Cable Networks Segment—Operating Costs and Expenses
Operating costs and expenses increased slightly for the three months ended June 30, 2017 compared to the same period in 2016 primarily due to an increase in other operating and administrative expenses, which was primarily due to an increase in employee-related costs.
Operating costs and expenses increased slightly for the six months ended June 30, 2017 compared to the same period in 2016 primarily due to increases in programming and production costs and other operating and administrative expenses. The increase in programming and production costs was primarily due to higher studio production costs and an increase in sports programming rights costs. The increase in other operating and administrative expenses was primarily due to an increase in employee-related costs.
Broadcast Television Segment Results of Operations
 
Three Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
%
Revenue
 
 
 
 
 
 
Advertising
$
1,270

 
$
1,285

 
$
(15
)
(1.2
)%
Content licensing
523

 
512

 
11

2.1

Distribution and other
448

 
331

 
117

36.1

Total revenue
2,241

 
2,128

 
113

5.3

Operating costs and expenses
 
 
 
 
 
 
Programming and production
1,352

 
1,304

 
48

3.7

Other operating and administrative
349

 
335

 
14

4.8

Advertising, marketing and promotion
124

 
95

 
29

29.3

Total operating costs and expenses
1,825

 
1,734

 
91

5.3

Adjusted EBITDA
$
416

 
$
394

 
$
22

5.5
 %
 
Six Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
%
Revenue
 
 
 
 
 
 
Advertising
$
2,549

 
$
2,560

 
$
(11
)
(0.5
)%
Content licensing
1,026

 
1,002

 
24

2.4

Distribution and other
874

 
650

 
224

34.7

Total revenue
4,449

 
4,212

 
237

5.6

Operating costs and expenses
 
 
 
 
 
 
Programming and production
2,784

 
2,667

 
117

4.4

Other operating and administrative
685

 
653

 
32

5.2

Advertising, marketing and promotion
242

 
214

 
28

12.7

Total operating costs and expenses
3,711

 
3,534

 
177

5.0

Adjusted EBITDA
$
738

 
$
678

 
$
60

8.8
 %

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Broadcast Television Segment—Revenue
Broadcast Television revenue increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to increases in distribution and other revenue. The increases in distribution and other revenue were primarily due to increases in fees recognized under our retransmission consent agreements. Content licensing revenue increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 due to the timing of content provided under our licensing agreements. Advertising revenue decreased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to the impact of declines in audience ratings, which were partially offset by higher prices for advertising units sold. The decrease in advertising revenue for the six months ended June 30, 2017 was also due to a decrease in the volume of advertising units sold.
Broadcast Television Segment—Operating Costs and Expenses
Operating costs and expenses increased for the three months ended June 30, 2017 compared to the same period in 2016 primarily due to increases in programming and production costs and advertising, marketing and promotion expenses. The increase in programming and production costs was primarily due to an increase in sports programming rights costs and higher studio production costs. The increase in advertising, marketing and promotion expenses was primarily due to increases in marketing spend related to our entertainment and news programming.
Operating costs and expenses increased for the six months ended June 30, 2017 compared to the same period in 2016 primarily due to increases in programming and production costs and other operating and administrative expenses. The increase in programming and production costs was primarily due to an increase in sports programming rights costs and higher studio production costs. The increase in other operating and administrative expenses was primarily due to an increase in employee-related costs.
Filmed Entertainment Segment Results of Operations
 
Three Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
%
Revenue
 
 
 
 
 
 
Theatrical
$
837

 
$
297

 
$
540

181.2
%
Content licensing
683

 
598

 
85

14.1

Home entertainment
344

 
241

 
103

42.6

Other
291

 
215

 
76

37.1

Total revenue
2,155

 
1,351

 
804

59.6

Operating costs and expenses
 
 
 
 
 
 
Programming and production
1,088

 
628

 
460

73.2

Other operating and administrative
332

 
227

 
105

48.0

Advertising, marketing and promotion
450

 
440

 
10

2.0

Total operating costs and expenses
1,870

 
1,295

 
575

44.6

Adjusted EBITDA
$
285

 
$
56

 
$
229

407.4
%
 
Six Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
%
Revenue
 
 
 
 
 
 
Theatrical
$
1,488

 
$
533

 
$
955

179.0
%
Content licensing
1,414

 
1,250

 
164

13.1

Home entertainment
643

 
516

 
127

24.6

Other
591

 
435

 
156

36.5

Total revenue
4,136

 
2,734

 
1,402

51.3

Operating costs and expenses
 
 
 
 
 
 
Programming and production
1,963

 
1,250

 
713

57.0

Other operating and administrative
662

 
436

 
226

52.4

Advertising, marketing and promotion
858

 
825

 
33

3.9

Total operating costs and expenses
3,483

 
2,511

 
972

38.8

Adjusted EBITDA
$
653

 
$
223

 
$
430

192.7
%

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Table of Contents

Filmed Entertainment Segment—Revenue
Filmed Entertainment revenue increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to increases in theatrical revenue, as well as increases in content licensing revenue, other revenue and home entertainment revenue. The increases in theatrical revenue were primarily due to the strong performance of The Fate of the Furious in the current year periods. Theatrical revenue also increased for the six months ended June 30, 2017 due to the strong performances of Fifty Shades Darker, Sing, Split and Get Out in the current year period. Content licensing revenue increased primarily due to the inclusion of DreamWorks Animation in the current year periods. Other revenue increased due to increases in revenue from consumer products, including from DreamWorks Animation, in the current year periods. Home entertainment revenue increased primarily due to strong sales of several 2017 releases, including Fifty Shades Darker and Sing.
Filmed Entertainment Segment—Operating Costs and Expenses
Operating costs and expenses increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to increases in programming and production costs, as well as increases in other operating and administrative expenses. The increases in programming and production costs were primarily due to higher amortization of film production costs for our 2017 releases, as well as the inclusion of costs associated with DreamWorks Animation. The increases in other operating and administrative expenses were primarily due to the inclusion of expenses associated with DreamWorks Animation.
Theme Parks Segment Results of Operations
 
Three Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
%
Revenue
$
1,314

 
$
1,136

 
$
178

15.6
%
Operating costs and expenses
763

 
667

 
96

14.4

Adjusted EBITDA
$
551

 
$
469

 
$
82

17.3
%
 
Six Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
%
Revenue
$
2,432

 
$
2,162

 
$
270

12.5
%
Operating costs and expenses
1,484

 
1,318

 
166

12.6

Adjusted EBITDA
$
948

 
$
844

 
$
104

12.3
%
Theme Parks Segment—Revenue
Theme Parks revenue increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to higher guest attendance and increases in guest spending, including the continued success of The Wizarding World of Harry Potter™ attraction in Hollywood, which opened in April 2016, and the openings of Minion Park™ in Japan in April 2017 and Volcano Bay™ in Orlando in May 2017. The increase for the three months ended June 30, 2017 was also due to the timing of spring holidays compared to the prior year period.
Theme Parks Segment—Operating Costs and Expenses
Operating costs and expenses increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to higher operating costs related to higher guest attendance and new attractions, as well as additional marketing costs associated with our domestic theme parks.

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Corporate and Other Results of Operations
 
Three Months Ended
June 30
 
Increase/
(Decrease)
(in millions)
2017
 
2016
 
$
 
%
Revenue
$
205


$
180


$
25


14.4
 %
Operating costs and expenses
507


471


36


7.8

Adjusted EBITDA
$
(302
)

$
(291
)

$
(11
)

(3.7
)%
 
 
 
 
 
 
 
 
 
Six Months Ended
June 30

Increase/
(Decrease)
(in millions)
2017

2016

$

%
Revenue
$
413


$
379


$
34


9.1
 %
Operating costs and expenses
909


824


85


10.4

Adjusted EBITDA
$
(496
)

$
(445
)

$
(51
)

(11.5
)%
Corporate and Other—Revenue
Other revenue primarily relates to Comcast Spectacor, which owns the Philadelphia Flyers and the Wells Fargo Center arena in Philadelphia, Pennsylvania and operates arena management-related businesses, as well as revenue from other business initiatives, such as our wireless phone service. Other revenue increased for the three and six months ended June 30, 2017 compared to the same periods in 2016.
Corporate and Other—Operating Costs and Expenses
Corporate and Other operating costs and expenses primarily include overhead, personnel costs, the costs of other business initiatives, and operating costs and expenses associated with Comcast Spectacor.
Corporate and Other operating costs and expenses increased for the three and six months ended June 30, 2017 primarily due to expenses associated with our new wireless phone service.
Consolidated Other Income (Expense) Items, Net
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Interest expense
$
(758
)
 
$
(732
)
 
$
(1,513
)
 
$
(1,435
)
Investment income (loss), net
64

 
58

 
123

 
88

Equity in net income (losses) of investees, net
15

 
(19
)
 
51

 
(30
)
Other income (expense), net
20

 
(15
)
 
55

 
115

Total
$
(659
)
 
$
(708
)
 
$
(1,284
)
 
$
(1,262
)
Interest Expense
Interest expense increased for the three and six months ended June 30, 2017 compared to the same periods in 2016 primarily due to increases in our debt outstanding.
Investment Income (Loss), Net
The components of investment income (loss), net for the three and six months ended June 30, 2017 and 2016 are presented in a table in Note 6 to Comcast’s condensed consolidated financial statements.
Equity in Net Income (Losses) of Investees, Net
The changes in equity in net income (losses) of investees, net for the three and six months ended June 30, 2017 compared to the same periods in 2016 were primarily related to our equity method investments in Atairos Group, Inc. and Hulu, LLC. Atairos 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 income. We recognize our share of these gains and losses in equity in net income (losses) of investees, net. The losses at Hulu were driven by its higher programming and marketing costs. The equity in net income (losses) of Atairos and Hulu for the three and six months ended June 30, 2017 and 2016 are presented in the table below.

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Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Atairos
$
42

 
$
(12
)
 
$
99

 
$
(27
)
Hulu
$
(52
)
 
$
(40
)
 
$
(106
)
 
$
(65
)
Other Income (Expense), Net
Other income (expense), net for the six months ended June 30, 2016 included a gain of $108 million related to the sale of our investment in The Weather Channel’s product and technology businesses.
Consolidated Income Tax Expense
Income tax expense for the three and six months ended June 30, 2017 and 2016 reflects an effective income tax rate that differs from the federal statutory rate primarily due to state income taxes and adjustments associated with uncertain tax positions. In 2017, we prospectively adopted the new accounting guidance related to share-based compensation, which resulted in decreases in income tax expense of $59 million and $198 million for the three and six months ended June 30, 2017, respectively. We expect our 2017 annual effective tax rate to be in the range of 35% to 37%, absent changes in tax laws or significant changes in uncertain tax positions. The expected annual effective tax rate includes the impact of the adoption of the new accounting guidance related to share-based compensation (see Note 2 to Comcast’s condensed consolidated financial statements).
Liquidity and Capital Resources
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 facilities; and our ability to obtain future external financing. We anticipate that we will continue to use a substantial portion of our cash flows in repaying our debt obligations, funding our capital expenditures, investing in business opportunities and returning capital to shareholders.
On April 13, 2017, the Federal Communications Commission announced the results of its spectrum auction. In the auction, NBCUniversal relinquished its spectrum rights in the New York, Philadelphia and Chicago designated market areas where NBC and Telemundo had overlapping spectrum. NBCUniversal received proceeds of $482 million in July 2017. In connection with the auction, we also acquired the rights to $1.7 billion of spectrum, which were recorded to other intangible assets, net in our condensed consolidated balance sheet as of June 30, 2017. We had previously made a deposit of $1.8 billion to participate in the auction in the third quarter of 2016 and received a refund for amounts in excess of the purchase price in the second quarter of 2017.
Operating Activities
Components of Net Cash Provided by Operating Activities
 
Six Months Ended
June 30
(in millions)
2017
 
2016
Operating income
$
9,088

 
$
8,155

Depreciation and amortization
5,043

 
4,667

Noncash share-based compensation
391

 
331

Changes in operating assets and liabilities
(243
)
 
(558
)
Payments of interest
(1,372
)
 
(1,235
)
Payments of income taxes
(2,209
)
 
(1,685
)
Other
116

 
119

Net cash provided by operating activities
$
10,814

 
$
9,794

The variance in changes in operating assets and liabilities for the six months ended June 30, 2017 compared to the same period in 2016 was primarily due to the timing of film and television spending, which was partially offset by the timing of collections on our receivables related to theatrical releases in the current year period.
Investing Activities
Net cash used in investing activities for the six months ended June 30, 2017 consisted primarily of capital expenditures, purchases of investments, cash paid for intangible assets and acquisitions. Capital expenditures increased for the six months ended June 30, 2017 compared to the same period in 2016 primarily due to increased spending in our Cable Communications segment on continued

37
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investment in scalable infrastructure to increase network capacity and increased investment in line extensions primarily for the expansion of business services. NBCUniversal capital expenditures decreased for the six months ended June 30, 2017 compared to the same period in 2016 primarily due to the timing of real estate and infrastructure spending offset by continued investment at our Theme Parks segment. Purchases of investments for the six months ended June 30, 2017 consisted primarily of our cash capital contributions to Atairos of $994 million and our investment in Snap Inc. of $500 million.
Financing Activities
Net cash used in financing activities for the six months ended June 30, 2017 consisted primarily of repayments of debt, repurchases of common stock under our repurchase program and employee plans, the purchase of the remaining 49% noncontrolling interests in Universal Studios Japan, and dividend payments, which were partially offset by proceeds from borrowings.
We have made, and may from time to time in the future make, optional repayments on our debt obligations, which may include repurchases of our outstanding public notes and debentures, depending on various factors, such as market conditions. See Note 7 to Comcast’s condensed consolidated financial statements for additional information on our financing activities, including details of our debt repayments and borrowings.
Available Borrowings Under Credit Facilities
We also maintain significant availability under our lines of credit and commercial paper programs to meet our short-term liquidity requirements.
As of June 30, 2017, amounts available under our consolidated revolving credit facilities, net of amounts outstanding under our commercial paper programs and outstanding letters of credit, totaled $7.2 billion, which included $1.5 billion available under the NBCUniversal Enterprise revolving credit facility.
Share Repurchases and Dividends
Effective January 1, 2017, our Board of Directors increased our share repurchase program authorization to $12 billion, which does not have an expiration date. Under the authorization, we may repurchase shares in the open market or in private transactions. During the six months ended June 30, 2017, we repurchased a total of 56 million shares of our Class A common stock for $2.1 billion. We expect to make $2.9 billion more in repurchases under this authorization during the remainder of 2017, subject to market conditions.
In addition, we paid $345 million for the six months ended June 30, 2017 related to employee taxes associated with the administration of our share-based compensation plans.
In January 2017, our Board of Directors approved a 15% increase in our dividend to $0.63 per share on an annualized basis. In May 2017, our Board of Directors approved our second quarter dividend of $0.1575 per share to be paid in July 2017. We expect to continue to pay quarterly dividends, although each dividend is subject to approval by our Board of Directors.
Critical Accounting Judgments and 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.
For a more complete discussion of the accounting judgments and 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 2016 Annual Report on Form 10-K.
Recent Accounting Pronouncements
See Note 2 to each of Comcast’s and NBCUniversal’s condensed consolidated financial statements for additional information related to recent accounting pronouncements.
ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We have evaluated the information required under this item that was disclosed in our 2016 Annual Report on Form 10-K and there have been no significant changes to this information.

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Table of Contents

ITEM 4: CONTROLS AND PROCEDURES
Comcast Corporation
Conclusions regarding disclosure controls and procedures
Our principal executive and principal financial officers, after evaluating the effectiveness of Comcast’s 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, Comcast’s disclosure controls and procedures were effective.
Changes in internal control over financial reporting
There were no changes in Comcast’s 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 Comcast’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, Comcast’s internal control over financial reporting.
NBCUniversal Media, LLC
Conclusions regarding disclosure controls and procedures
Our principal executive and principal financial officers, after evaluating the effectiveness of NBCUniversal’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) 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, NBCUniversal’s disclosure controls and procedures were effective.
Changes in internal control over financial reporting
There were no changes in NBCUniversal’s 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 NBCUniversal’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, NBCUniversal’s internal control over financial reporting.
PART II: OTHER INFORMATION
ITEM 1: LEGAL PROCEEDINGS
Refer to Note 10 to Comcast’s condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for a discussion of legal proceedings.
NBCUniversal is subject to legal proceedings and claims that arise in the ordinary course of its business and does not expect the final disposition of these matters to have a material adverse effect on its results of operations, cash flows or financial condition, although any such matters could be time-consuming and costly and could injure its reputation.
ITEM 1A: RISK FACTORS
There have been no significant changes from the risk factors previously disclosed in Item 1A of our 2016 Annual Report on Form 10-K.


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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 June 30, 2017.
Purchases of Equity Securities 
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)
April 1-30, 2017
—

 
$
—

—

$
—

$
11,250,000,006

May 1-31, 2017
16,575,436


$
38.07

16,575,436

$
631,090,407

$
10,618,909,599

June 1-30, 2017
18,575,005

 
$
40.38

18,575,005

$
750,000,000

$
9,868,909,599

Total
35,150,441

 
$
39.29

35,150,441

$
1,381,090,407

$
9,868,909,599

(a)
Effective January 1, 2017, our Board of Directors increased our share repurchase program authorization to $12 billion, which does not have an expiration date. Under this authorization, we may repurchase shares in the open market or in private transactions. We expect to make $2.9 billion more in repurchases under this authorization during the remainder of 2017, subject to market conditions.
The total number of shares purchased during the three months ended June 30, 2017 does not include any shares received in the administration of employee share-based compensation plans.
ITEM 5: OTHER INFORMATION
Iran Threat Reduction and Syria Human Rights Act Disclosure
Pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012, companies are required, among other things, to disclose certain activities, transactions or dealings with the Government of Iran or entities controlled directly or indirectly by the Government of Iran. Disclosure is generally required even where the activities, transactions or dealings are conducted in compliance with applicable laws and regulations and are de minimis. As of the date of this report, we are not aware of any activity, transaction or dealing during the three months ended June 30, 2017 that requires disclosure under the Act, except with respect to a January 2016 licensing agreement by a non-U.S. subsidiary of DreamWorks Animation prior to our August 2016 DreamWorks Animation acquisition. The agreement licensed a prior season of a children’s animated television series for a three-year, non-cancelable term and for a one-time fee of $5,200 to a broadcasting company that is owned and controlled by the Government of Iran. The broadcasting company paid the license fee in the first quarter of 2016. We believe that DreamWorks Animation conducted its licensing activity in compliance with applicable laws and that the license is for the permissible exportation of informational materials pursuant to certain statutory and regulatory exemptions from U.S. sanctions.
Employment Agreement
On July 26, 2017, Comcast Corporation entered into a new employment agreement with Brian L. Roberts, Chairman of the Board of Directors, President and Chief Executive Officer of Comcast Corporation, effective as of August 1, 2017.  The new employment agreement provides for an initial term of employment through July 31, 2020, which term will be extended automatically so that the term of the agreement will always be three years, unless otherwise terminated by either party in accordance with the employment agreement.  The new employment agreement does not change Mr. Roberts’ base salary or target bonus opportunity, in each case as provided under Mr. Roberts’ prior employment agreement. The new employment agreement sets forth the annual crediting contributions to Mr. Roberts’ deferred compensation plan account, with annual contributions increasing by 5% each year during the term of the agreement.  The new employment agreement also provides for certain changes with respect to Mr. Roberts’ compensation following a termination of employment as a result of his disability, by Comcast Corporation without cause or by Mr. Roberts for good reason, in each case as set forth in the new employment agreement, a copy of which is attached hereto as Exhibit 10.2.
The above summary is qualified in its entirety by the terms and conditions set forth in the new employment agreement, attached hereto as Exhibit 10.2.  

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ITEM 6: EXHIBITS
Comcast
Exhibit
No.
 
Description
 
Amended and restated By-Laws of Comcast Corporation, effective May 10, 2017 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed on May 12, 2017).
 
Employment Agreement between Comcast Corporation and Brian L. Roberts, dated as of June 30, 2017.
 
Amendment No. 18 to Employment Agreement between Comcast Corporation and Brian L. Roberts, dated as of July 26, 2017.
 
Wireless Operational Cooperation Agreement dated as of May 5, 2017 between Comcast Corporation and Charter Communications, Inc. (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on May 8, 2017).
 
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
 
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 three and six months ended June 30, 2017, filed with the Securities and Exchange Commission on July 27, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheet; (ii) the Condensed Consolidated Statement of Income; (iii) the Condensed Consolidated Statement of Comprehensive Income; (iv) the Condensed Consolidated Statement of Cash Flows; (v) the Condensed Consolidated Statement of Changes in Equity; and (vi) the Notes to Condensed Consolidated Financial Statements.
* Constitutes a management contract or compensatory plan or arrangement.
 
NBCUniversal
Exhibit
No.
 
Description
 
Loan Agreement dated as of May 1, 2017, among USJ Co., Ltd., the financial institutions party thereto (the “lenders”) and Sumitomo Mitusi Banking Corporation, as agent (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on May 3, 2017).
 
Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
 
Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101
 
The following financial statements from NBCUniversal Media, LLC’s Quarterly Report on Form 10-Q for the three and six months ended June 30, 2017, filed with the Securities and Exchange Commission on July 27, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheet; (ii) the Condensed Consolidated Statement of Income; (iii) the Condensed Consolidated Statement of Comprehensive Income; (iv) the Condensed Consolidated Statement of Cash Flows; (v) the Condensed Consolidated Statement of Changes in Equity; and (vi) the Notes to Condensed Consolidated Financial Statements.

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SIGNATURES
Comcast
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
Senior Vice President, Chief Accounting Officer and Controller
(Principal Accounting Officer)
Date: July 27, 2017
NBCUniversal
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.
 
 
NBCUNIVERSAL MEDIA, LLC
 
 
By:
 
/s/ DANIEL C. MURDOCK
 
 
Daniel C. Murdock
Senior Vice President
(Principal Accounting Officer)
Date: July 27, 2017


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NBCUniversal Media, LLC Financial Statements
Index
Page


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NBCUniversal Media, LLC

Condensed Consolidated Balance Sheet
(Unaudited)
(in millions)
June 30,
2017
 
December 31,
2016
Assets
 
 
 
Current Assets:
 
 
 
Cash and cash equivalents
$
1,844

 
$
1,966

Receivables, net
6,319

 
6,302

Programming rights
1,625

 
1,241

Other current assets
1,496

 
938

Total current assets
11,284

 
10,447

Film and television costs
6,590

 
7,245

Investments
1,890

 
1,263

Property and equipment, net of accumulated depreciation of $3,773 and $3,350
10,845

 
10,511

Goodwill
23,946

 
23,323

Intangible assets, net of accumulated amortization of $7,105 and $6,568
13,555

 
13,777

Other noncurrent assets, net
1,697

 
1,688

Total assets
$
69,807

 
$
68,254

Liabilities and Equity
 
 
 
Current Liabilities:
 
 
 
Accounts payable and accrued expenses related to trade creditors
$
1,490

 
$
1,647

Accrued participations and residuals
1,882

 
1,726

Program obligations
600

 
807

Deferred revenue
1,357

 
1,016

Accrued expenses and other current liabilities
1,914

 
1,888

Note payable to Comcast
2,981

 
2,703

Current portion of long-term debt
194

 
127

Total current liabilities
10,418

 
9,914

Long-term debt, less current portion
12,149

 
11,461

Accrued participations, residuals and program obligations
1,196

 
1,202

Other noncurrent liabilities
4,117

 
4,130

Commitments and contingencies

 

Redeemable noncontrolling interests
512

 
530

Equity:

 
 
Member’s capital
40,411

 
39,036

Accumulated other comprehensive income (loss)
56

 
(135
)
Total NBCUniversal member’s equity
40,467

 
38,901

Noncontrolling interests
948

 
2,116

Total equity
41,415

 
41,017

Total liabilities and equity
$
69,807

 
$
68,254

See accompanying notes to condensed consolidated financial statements.

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NBCUniversal Media, LLC

Condensed Consolidated Statement of Income
(Unaudited) 
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Revenue
$
8,331

 
$
7,103

 
$
16,199

 
$
13,964

Costs and Expenses:
 
 
 
 
 
 
 
Programming and production
3,587

 
3,037

 
6,900

 
6,002

Other operating and administrative
1,895

 
1,652

 
3,727

 
3,247

Advertising, marketing and promotion
778

 
725

 
1,484

 
1,404

Depreciation
265

 
223

 
496

 
415

Amortization
255

 
242

 
532

 
464

 
6,780

 
5,879

 
13,139

 
11,532

Operating income
1,551

 
1,224

 
3,060

 
2,432

Other Income (Expense):
 
 
 
 
 
 
 
Interest expense
(149
)
 
(146
)
 
(292
)
 
(293
)
Investment income (loss), net
10

 
8

 
24

 
14

Equity in net income (losses) of investees, net
(29
)
 
(19
)
 
(55
)
 
(21
)
Other income (expense), net
4

 
(18
)
 
15

 
97

 
(164
)
 
(175
)
 
(308
)
 
(203
)
Income before income taxes
1,387

 
1,049

 
2,752

 
2,229

Income tax expense
(99
)
 
(74
)
 
(191
)
 
(172
)
Net income
1,288

 
975

 
2,561

 
2,057

Net (income) loss attributable to noncontrolling interests
(12
)
 
(42
)
 
(85
)
 
(122
)
Net income attributable to NBCUniversal
$
1,276

 
$
933

 
$
2,476

 
$
1,935

See accompanying notes to condensed consolidated financial statements.

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NBCUniversal Media, LLC

Condensed Consolidated Statement of Comprehensive Income
(Unaudited) 
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Net income
$
1,288

 
$
975

 
$
2,561

 
$
2,057

Unrealized gains (losses) on marketable securities, net
(140
)
 
—

 
(139
)
 
—

Deferred gains (losses) on cash flow hedges, net
(8
)
 
6

 
(22
)
 
(12
)
Employee benefit obligations, net
(2
)
 
—

 
104

 
4

Currency translation adjustments, net
(11
)
 
307

 
189

 
602

Comprehensive income
1,127

 
1,288

 
2,693

 
2,651

Net (income) loss attributable to noncontrolling interests
(12
)
 
(42
)
 
(85
)
 
(122
)
Other comprehensive (income) loss attributable to noncontrolling interests
5

 
(150
)
 
(82
)
 
(287
)
Comprehensive income attributable to NBCUniversal
$
1,120

 
$
1,096

 
$
2,526

 
$
2,242

See accompanying notes to condensed consolidated financial statements.

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NBCUniversal Media, LLC

Condensed Consolidated Statement of Cash Flows
(Unaudited) 
 
Six Months Ended
June 30
(in millions)
2017
 
2016
Net cash provided by operating activities
$
3,526

 
$
2,478

Investing Activities
 
 
 
Capital expenditures
(623
)
 
(655
)
Cash paid for intangible assets
(128
)
 
(114
)
Acquisitions of real estate properties
—

 
(78
)
Proceeds from sales of investments
10

 
102

Other
(241
)
 
(107
)
Net cash provided by (used in) investing activities
(982
)
 
(852
)
Financing Activities
 
 
 
Proceeds from borrowings
3,948

 
—

Repurchases and repayments of debt
(3,402
)
 
(1,083
)
Proceeds from (repayments of) borrowings from Comcast, net
278

 
134

Distributions to member
(1,141
)
 
(853
)
Distributions to noncontrolling interests
(116
)
 
(104
)
Purchase of Universal Studios Japan noncontrolling interests
(2,299
)
 
—

Other
66

 
25

Net cash provided by (used in) financing activities
(2,666
)
 
(1,881
)
Increase (decrease) in cash and cash equivalents
(122
)
 
(255
)
Cash and cash equivalents, beginning of period
1,966

 
1,410

Cash and cash equivalents, end of period
$
1,844

 
$
1,155

See accompanying notes to condensed consolidated financial statements.


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NBCUniversal Media, LLC

Condensed Consolidated Statement of Changes in Equity
(Unaudited)
(in millions)
Redeemable
Noncontrolling
Interests
 
Member’s
Capital
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Noncontrolling
Interests
 
Total Equity
Balance, December 31, 2015
$
372

 
$
32,834

 
$
(212
)
 
$
1,681

 
$
34,303

Dividends declared

 
(853
)
 

 

 
(853
)
Contributions from (distributions to) noncontrolling interests, net
(29
)
 

 

 
(75
)
 
(75
)
Other comprehensive income (loss)

 

 
307

 
287

 
594

Other

 
5

 

 
155

 
160

Net income (loss)
24

 
1,935

 
 
 
98

 
2,033

Balance, June 30, 2016
$
367

 
$
33,921

 
$
95

 
$
2,146

 
$
36,162

Balance, December 31, 2016
$
530

 
$
39,036

 
$
(135
)
 
$
2,116

 
$
41,017

Dividends declared
 
 
(1,141
)
 

 

 
(1,141
)
Contributions from (distributions to) noncontrolling interests, net
(46
)
 

 

 
(55
)
 
(55
)
Contribution from member

 
662

 


 


 
662

Other comprehensive income (loss)

 


 
50

 
82

 
132

Purchase of Universal Studios Japan noncontrolling interests
 
 
(704
)
 
141

 
(1,736
)
 
(2,299
)
Other
10

 
82

 

 
474

 
556

Net income (loss)
18

 
2,476

 

 
67

 
2,543

Balance, June 30, 2017
$
512

 
$
40,411

 
$
56

 
$
948

 
$
41,415

See accompanying notes to condensed consolidated financial statements.

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NBCUniversal Media, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1: Condensed Consolidated Financial Statements
Basis of Presentation
Unless indicated otherwise, throughout these notes to the condensed consolidated financial statements, we refer to NBCUniversal and its consolidated subsidiaries as “we,” “us” and “our.” 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, financial condition and cash flows 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 2016 Annual Report on Form 10-K.
Note 2: Recent Accounting Pronouncements
Revenue Recognition
In May 2014, the Financial Accounting Standards Board (“FASB”) updated the accounting guidance related to revenue recognition. The updated accounting guidance provides a single, contract-based revenue recognition model to help improve financial reporting by providing clearer guidance on when an entity should recognize revenue and by reducing the number of standards to which an entity has to refer. The updated accounting guidance is effective for us as of January 1, 2018.
We have substantially completed the review of our revenue arrangements and do not currently expect that the adoption of the new standard will have a material impact on our financial position or results of operations. However, we do expect that the new standard will impact the timing of recognition for our Cable Networks, Broadcast Television and Filmed Entertainment segments’ content licensing revenue associated with renewals or extensions of existing program licensing agreements, which will be recognized as revenue when the licensed content becomes available under the renewal or extension instead of when the agreement is renewed or extended. The updated guidance also requires additional disclosures regarding the nature, timing and uncertainty of our revenue transactions. We intend to adopt the provisions of the guidance using the full retrospective method, under which we will adjust any prior periods presented to reflect the updated guidance.
Financial Assets and Financial Liabilities
In January 2016, the FASB updated the accounting guidance related to the recognition and measurement of financial assets and financial liabilities. The updated accounting guidance, among other things, requires that all nonconsolidated equity investments, except those accounted for under the equity method, be measured at fair value and that the changes in fair value be recognized in net income. The updated guidance is effective for us as of January 1, 2018. The updated accounting guidance requires a cumulative effect adjustment to beginning retained earnings in the year the guidance is adopted with certain exceptions. If we had adopted the provisions of the updated guidance as of January 1, 2017 for our equity investments classified as available-for-sale securities, primarily our investment in Snap Inc. (see Note 6), net income attributable to NBCUniversal would have decreased for the three and six months ended June 30, 2017 by $140 million and $139 million, respectively. We are currently in the process of determining the impact that the updated accounting guidance will have on our cost method investments.
Leases
In February 2016, the FASB updated the accounting guidance related to leases. The updated accounting guidance requires lessees to recognize a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. The asset and liability are initially measured based on the present value of committed lease payments. For a lessee, the recognition, measurement and presentation of expenses and cash flows arising from a lease do not significantly change from previous guidance. For a lessor, the accounting applied is also largely unchanged from previous guidance. The updated guidance is effective for us as of January 1, 2019 and early adoption is permitted. The updated accounting guidance must be adopted using a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. We are currently in the process of determining the impact that the updated accounting guidance will have on our consolidated financial statements.

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NBCUniversal Media, LLC

Note 3: Significant Transactions
FCC Spectrum Auction
On April 13, 2017, the Federal Communications Commission announced the results of its spectrum auction. In the auction, we relinquished our spectrum rights in the New York, Philadelphia and Chicago designated market areas (“DMAs”) where NBC and Telemundo had overlapping spectrum. We received proceeds of $482 million in July 2017. NBC and Telemundo stations will share broadcast signals in these DMAs.
Universal Studios Japan
On April 6, 2017, we acquired the remaining interests in Universal Studios Japan that we did not already own for $2.3 billion. The acquisition was funded through borrowings under our revolving credit agreement with Comcast. Because we maintained control of Universal Studios Japan, the difference between the consideration transferred and the recorded value of the noncontrolling interests, as well as the related accumulated other comprehensive income impact, were recorded to additional paid-in capital.
DreamWorks Animation
On August 22, 2016, Comcast acquired all of the outstanding stock of DreamWorks Animation for $3.8 billion. DreamWorks Animation’s stockholders received $41 in cash for each share of DreamWorks Animation common stock. DreamWorks Animation creates animated feature films, television series and specials, live entertainment, and related consumer products.
Following the acquisition, Comcast converted DreamWorks Animation to a limited liability company and contributed its equity to us as a capital contribution. The net assets contributed to us excluded deferred income taxes and other tax-related items recorded by Comcast. The results of operations for DreamWorks Animation are reported in our Filmed Entertainment segment following the acquisition date and are presented as if the initial equity contribution occurred on the date of Comcast’s acquisition.
Allocation of Purchase Price
The transaction was accounted for under the acquisition method of accounting and, accordingly, the assets and liabilities are to be recorded at their fair market values as of the acquisition date. We recorded the acquired assets and liabilities of DreamWorks Animation at their estimated fair values based on valuation analyses. In valuing acquired assets and liabilities, fair value estimates were primarily based on Level 3 inputs, including future expected cash flows, market rate assumptions and discount rates. The fair value of the assumed debt was primarily based on quoted market values. The fair value of the liability related to a tax receivable agreement that DreamWorks Animation had previously entered into with one of its former stockholders (the “tax receivable agreement”) was based on the contractual settlement provisions in the agreement. During the six months ended June 30, 2017, we updated the preliminary allocation of purchase price for DreamWorks Animation, which primarily resulted in increases to noncontrolling interests, intangible assets and goodwill and a decrease to working capital. The changes did not have a material impact on our condensed consolidated financial statements. We may adjust these amounts further as valuations are finalized and we obtain information necessary to complete the analyses, but no later than one year from the acquisition date.
The table below presents the preliminary allocation of the purchase price to the assets and liabilities of DreamWorks Animation.
Allocation of Purchase Price
(in millions)
  
Film and television costs
$
854

Intangible assets
396

Working capital
163

Debt
(381
)
Tax receivable agreement(a)
(146
)
Other noncurrent assets and liabilities and other(b)
435

Identifiable net assets (liabilities) acquired
1,321

Noncontrolling interests
(337
)
Goodwill
2,789

Cash consideration transferred
$
3,773

(a)
The tax receivable agreement was settled immediately following the acquisition and the payment was recorded as an operating activity in our condensed consolidated statement of cash flows in the third quarter of 2016. Comcast made a separate cash capital contribution of $146 million to fund the settlement which was recorded as a financing activity in our condensed consolidated statement of cash flows in the third quarter of 2016.
(b)
Other included $289 million recorded to member’s capital that represented deferred income tax assets and other tax-related items recorded by Comcast but excluded from the net assets contributed to us.
Revenue and net income attributable to the acquisition of DreamWorks Animation were not material for the three and six months ended June 30, 2017.

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NBCUniversal Media, LLC

Note 4: Related Party Transactions
In the ordinary course of our business, we enter into transactions with Comcast.
We generate revenue from Comcast primarily from the distribution of our cable network programming, the fees received under retransmission consent agreements in our Broadcast Television segment and, to a lesser extent, the sale of advertising and our owned programming, and we incur expenses primarily related to advertising and various support services provided by Comcast to us.
Comcast is also the counterparty to one of our contractual obligations. As of June 30, 2017, the carrying value of the liability associated with this contractual obligation was $383 million.
The following tables present transactions with Comcast and its consolidated subsidiaries that are included in our condensed consolidated financial statements.
Condensed Consolidated Balance Sheet
(in millions)
June 30,
2017
 
December 31,
2016
Transactions with Comcast and Consolidated Subsidiaries
 
 
 
Receivables, net
$
324

 
$
285

Accounts payable and accrued expenses related to trade creditors
$
39

 
$
55

Accrued expenses and other current liabilities
$
26

 
$
4

Note payable to Comcast
$
2,981

 
$
2,703

Other noncurrent liabilities
$
389

 
$
389

Condensed Consolidated Statement of Income
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Transactions with Comcast and Consolidated Subsidiaries
 
 
 
 
 
 
 
Revenue
$
460

 
$
406

 
$
919

 
$
813

Operating costs and expenses
$
(49
)
 
$
(44
)
 
$
(110
)
 
$
(104
)
Other income (expense)
$
(28
)
 
$
(17
)
 
$
(47
)
 
$
(30
)
Note 5: Film and Television Costs
(in millions)
June 30,
2017
 
December 31,
2016
Film Costs:
 
 
 
Released, less amortization
$
1,949

 
$
1,750

Completed, not released
93

 
50

In production and in development
813

 
1,310

 
2,855

 
3,110

Television Costs:
 
 
 
Released, less amortization
1,888

 
1,953

In production and in development
751

 
853

 
2,639

 
2,806

Programming rights, less amortization
2,721

 
2,570

 
8,215

 
8,486

Less: Current portion of programming rights
1,625

 
1,241

Film and television costs
$
6,590

 
$
7,245


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Note 6: Investments
(in millions)
June 30,
2017
 
December 31,
2016
Fair Value Method:


 


Snap
$
522

 
$
—

Other
3

 
6


525

 
6

Equity Method:


 


Hulu
218

 
225

Other
415

 
336


633

 
561

Cost Method:


 


BuzzFeed
400

 
400

Other
351

 
296


751

 
696

Total investments
1,909

 
1,263

Less: Current investments
19

 
—

Noncurrent investments
$
1,890

 
$
1,263

Fair Value Method
Snap
In March 2017, Comcast acquired an interest in Snap Inc. as part of its initial public offering. On March 31, 2017, Comcast contributed its investment in Snap to us as an equity contribution of $662 million, which was recorded in our condensed consolidated statement of equity based on the fair value of the investment as of March 31, 2017. We have classified our investment as an available-for-sale security. Snap is a camera company whose primary product is Snapchat, a camera app that was created to help people communicate through short videos and images.
Equity Method
The Weather Channel
In January 2016, following a legal restructuring at The Weather Channel, we and the other investors sold the entity holding The Weather Channel’s product and technology businesses to IBM. Following the close of the transaction, we continue to hold an investment in The Weather Channel cable network through a new holding company. As a result of the sale of our investment, we recognized a pretax gain of $108 million in other income (expense), net for the six months ended June 30, 2016.
Note 7: Long-Term Debt
As of June 30, 2017, our debt, excluding the note payable to Comcast, had a carrying value of $12.3 billion and an estimated fair value of $13.5 billion. The estimated fair value of our publicly traded debt was primarily based on Level 1 inputs that use quoted market values 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 2017, Universal Studios Japan entered into a new ¥450 billion ($3.9 billion at issuance) term loan with a final maturity of March 2022. We used the proceeds from this borrowing to repay in full $3.3 billion of Universal Studios Japan’s existing yen-denominated term loans and a portion of amounts outstanding under our revolving credit agreement with Comcast.
Cross-Guarantee Structure
We, Comcast and a 100% owned cable holding company subsidiary of Comcast (“CCCL Parent”) have fully and unconditionally guaranteed each other’s debt securities, including the $7 billion Comcast revolving credit facility due 2021. As of June 30, 2017, outstanding debt securities of $46.1 billion of Comcast and CCCL Parent were subject to the guarantee structure.
We do not, however, guarantee the obligations of NBCUniversal Enterprise with respect to its $4.8 billion aggregate principal amount of senior notes, $1.5 billion revolving credit facility, commercial paper program, or $725 million liquidation preference of Series A cumulative preferred stock.
The Universal Studios Japan term loan is not subject to the cross-guarantee structure, however it has a separate guarantee from Comcast.

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Note 8: Share-Based Compensation
Comcast maintains share-based compensation plans that consist primarily of awards of restricted share units and stock options to certain employees and directors as part of its approach to long-term incentive compensation. Additionally, through its employee stock purchase plans, employees are able to purchase shares of Comcast common stock at a discount through payroll deductions. Certain of our employees participate in these plans and the expense associated with their participation is settled in cash with Comcast.
Recognized Share-Based Compensation Expense
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Restricted share units
$
34

 
$
27

 
$
54

 
$
45

Stock options
5

 
2

 
7

 
4

Employee stock purchase plans
1

 
2

 
4

 
5

Total
$
40

 
$
31

 
$
65

 
$
54

Note 9: Supplemental Financial Information
Receivables
(in millions)
June 30,
2017
 
December 31,
2016
Receivables, gross
$
6,738

 
$
6,799

Less: Allowance for returns and customer incentives
341

 
413

Less: Allowance for doubtful accounts
78

 
84

Receivables, net
$
6,319

 
$
6,302

Accumulated Other Comprehensive Income (Loss)
(in millions)
June 30,
2017
 
June 30,
2016
Unrealized gains (losses) on marketable securities
$
(139
)
 
$
—

Deferred gains (losses) on cash flow hedges
1

 
(13
)
Unrecognized gains (losses) on employee benefit obligations
118

 
3

Cumulative translation adjustments
76

 
105

Accumulated other comprehensive income (loss)
$
56

 
$
95

Net Cash Provided by Operating Activities 
 
Six Months Ended
June 30
(in millions)
2017
 
2016
Net income
$
2,561

 
$
2,057

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
1,028

 
879

Equity in net (income) losses of investees, net
55

 
21

Cash received from investees
44

 
31

Net (gain) loss on investment activity and other
(26
)
 
(92
)
Deferred income taxes
19

 
64

Changes in operating assets and liabilities, net of effects of acquisitions and divestitures:
 
 
 
Current and noncurrent receivables, net
(95
)
 
145

Film and television costs, net
275

 
(179
)
Accounts payable and accrued expenses related to trade creditors
(220
)
 
(185
)
Other operating assets and liabilities
(115
)
 
(263
)
Net cash provided by operating activities
$
3,526

 
$
2,478


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NBCUniversal Media, LLC

Cash Payments for Interest and Income Taxes 
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Interest
$
210

 
$
219

 
$
287

 
$
285

Income taxes
$
97

 
$
63

 
$
149

 
$
122

Noncash Investing and Financing Activities
During the six months ended June 30, 2017:
•
we acquired $294 million of property and equipment and intangible assets that were accrued but unpaid
•
Comcast contributed its investment in Snap to us at its fair value as of March 31, 2017, which was a noncash transaction (see Note 6 for additional information)
Note 10: Financial Data by Business Segment
We present our operations in four reportable business segments:
•
Cable Networks: Consists primarily of our national cable networks, our regional sports and news networks, our international cable networks, and our cable television studio production operations.
•
Broadcast Television: Consists primarily of the NBC and Telemundo broadcast networks, our NBC and Telemundo owned local broadcast television stations, the NBC Universo national cable network, and our broadcast television studio production operations.
•
Filmed Entertainment: Consists primarily of the operations of Universal Pictures, which produces, acquires, markets and distributes filmed entertainment worldwide; our films are also produced under the Illumination, Focus Features and DreamWorks Animation names.
•
Theme Parks: Consists primarily of our Universal theme parks in Orlando, Florida; Hollywood, California; and Osaka, Japan.
We use Adjusted EBITDA (formerly operating income before depreciation and amortization) to evaluate the profitability of our operating segments and the components of net income attributable to NBCUniversal below Adjusted EBITDA are not separately evaluated. Our financial data by business segment is presented in the tables below.
 
Three Months Ended June 30, 2017
(in millions)
Revenue(c)
Adjusted EBITDA(d)
Depreciation 
and Amortization
Operating 
Income (Loss)
Capital
Expenditures
Cash Paid for Intangible Assets
Cable Networks
$
2,696

$
1,055

$
181

$
874

$
8

$
4

Broadcast Television
2,241

416

31

385

30

4

Filmed Entertainment
2,155

285

26

259

19

6

Theme Parks
1,314

551

186

365

243

26

Headquarters and Other(a)
9

(235
)
96

(331
)
38

33

Eliminations(b)
(84
)
(1
)
—

(1
)
—

—

Total
$
8,331

$
2,071

$
520

$
1,551

$
338

$
73

 
Three Months Ended June 30, 2016
(in millions)
Revenue(c)
Adjusted EBITDA(d)
Depreciation 
and Amortization
Operating 
Income (Loss)
Capital
Expenditures
Cash Paid for Intangible Assets
Cable Networks
$
2,566

$
944

$
187

$
757

$
7

$
3

Broadcast Television
2,128

394

30

364

30

3

Filmed Entertainment
1,351

56

12

44

5

3

Theme Parks
1,136

469

145

324

240

20

Headquarters and Other(a)
6

(175
)
91

(266
)
78

33

Eliminations(b)
(84
)
1

—

1

—

—

Total
$
7,103

$
1,689

$
465

$
1,224

$
360

$
62


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NBCUniversal Media, LLC

 
Six Months Ended June 30, 2017
(in millions)
Revenue(c)
Adjusted EBITDA(d)
Depreciation 
and Amortization
Operating 
Income (Loss)
Capital
Expenditures
Cash Paid for Intangible Assets
Cable Networks
$
5,337

$
2,171

$
395

$
1,776

$
10

$
7

Broadcast Television
4,449

738

63

675

59

7

Filmed Entertainment
4,136

653

47

606

29

11

Theme Parks
2,432

948

328

620

472

39

Headquarters and Other(a)
17

(420
)
195

(615
)
53

64

Eliminations(b)
(172
)
(2
)
—

(2
)
—

—

Total
$
16,199

$
4,088

$
1,028

$
3,060

$
623

$
128

 
 
Six Months Ended June 30, 2016
(in millions)
Revenue(c)
Adjusted EBITDA(d)
Depreciation 
and Amortization
Operating 
Income (Loss)
Capital
Expenditures
Cash Paid for Intangible Assets
Cable Networks
$
5,019

$
1,900

$
377

$
1,523

$
8

$
4

Broadcast Television
4,212

678

62

616

49

6

Filmed Entertainment
2,734

223

20

203

8

6

Theme Parks
2,162

844

243

601

440

29

Headquarters and Other(a)
9

(335
)
177

(512
)
150

69

Eliminations(b)
(172
)
1

—

1

—

—

Total
$
13,964

$
3,311

$
879

$
2,432

$
655

$
114

(a)
Headquarters and Other activities include costs associated with overhead, allocations, personnel costs and headquarter initiatives.
(b)
Included in Eliminations are transactions that our segments enter into with one another, which consist primarily of the licensing of film and television content from our Filmed Entertainment and Broadcast Television segments to our Cable Networks segment.
(c)
No single customer accounted for a significant amount of revenue in any period.
(d)
We use Adjusted EBITDA as the measure of profit or loss for our operating segments. Adjusted EBITDA is defined as net income attributable to NBCUniversal before net (income) loss attributable to noncontrolling interests, income tax expense, other income (expense) items, net, and depreciation and amortization, and excluding impairment charges related to fixed and intangible assets and gains or losses on the sale of long-lived assets, if any. Other income (expense) items, net include interest expense, investment income (loss), equity in net income (losses) of investees, and other income (expense), net (as stated in our condensed consolidated statement of income). This measure eliminates the significant level of noncash amortization expense that results from intangible assets recognized in business combinations. Additionally, it is unaffected by our capital and tax structures and by our investment activities. We use this 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. We believe that this measure 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 may not be directly comparable to similar measures used by other companies. This measure should not be considered a substitute for operating income (loss), net income (loss), net income (loss) attributable to NBCUniversal, net cash provided by operating activities, or other measures of performance or liquidity we have reported in accordance with GAAP. Our reconciliation of the aggregate amount of Adjusted EBITDA for our reportable segments to consolidated income before income taxes is presented in the table below.
 
Three Months Ended
June 30
 
Six Months Ended
June 30
(in millions)
2017
 
2016
 
2017
 
2016
Adjusted EBITDA
$
2,071

 
$
1,689

 
$
4,088

 
$
3,311

Depreciation
(265
)
 
(223
)
 
(496
)
 
(415
)
Amortization
(255
)
 
(242
)
 
(532
)
 
(464
)
Other income (expense) items, net
(164
)
 
(175
)
 
(308
)
 
(203
)
Income before income taxes
$
1,387

 
$
1,049

 
$
2,752

 
$
2,229




55