Comcast bets big on broadband reset as theme parks and Peacock outshine a squeezed core

Leadership resets and a sharpened playbook

Comcast’s latest quarter reads like a company trying to run offense and defense at once. On one side stands a capital‑light, fast‑growing wireless business, booming Orlando parks and a streaming service that is finally narrowing losses. On the other, a broadband franchise that is under sustained competitive fire and a media arm absorbing the upfront cost of fresh sports rights.

Brian Roberts framed 2025 as an “inflection point” for both the company and the broader industry, using the call to underscore a reshaped leadership bench. Michael Cavanagh begins his first full year as co‑CEO, while newcomer Steve Crony, now CEO of Connectivity and Platforms, has been tasked with nothing less than resetting how Comcast competes in its core domestic franchise.

The narrative from the top was of urgency: a major reorganization complete, priorities clarified, and a management team that knows “the market is going to remain intensely competitive” and is planning on no external relief.

Broadband: sacrificing near‑term earnings for structural change

The centre of gravity in this quarter’s presentation was Comcast’s broadband reset. Cavanagh called it the company’s “most significant go‑to‑market shift” in its history.

The core elements are starkly simple compared with the baroque pricing of old. Residential customers now see four national speed tiers, all‑in pricing that folds in the company’s gateway and unlimited data, and a five‑year price guarantee. This is being pushed through as quickly as possible across a footprint that reaches some 65 million homes.

Crony described this as a deliberate rate “re‑investment” and investors are feeling the cost already. Broadband ARPU eked out 1.1% growth in Q4, but management guided explicitly to “further ARPU pressure” over the next few quarters, with no near‑term rate increase, the impact of free wireless lines used as a hook, and the ongoing migration to lower “everyday” prices.

The competitive backdrop offers no shelter. Fixed wireless has stabilised but remains a steady presence; fiber competition, meanwhile, intensified through the fourth quarter and “remains” elevated into the new year. Against that, Comcast lost 181,000 broadband subscribers in the quarter – an improvement is not yet visible in the headline numbers.

Connectivity & Platforms EBITDA fell 4.5% year on year, with management warning of “incremental EBITDA pressure over the next couple of quarters” before lapping these investments in 2026. Higher marketing, product and customer‑service costs – all part of the simplification and customer‑experience push – are weighing on margins in the interim.

Yet the company is backing this strategy with its largest broadband investment year ever in 2026, with an explicit goal: migrate the majority of residential customers to the new pricing and packaging by year‑end and put more of the base on gig‑plus and, eventually, multi‑gig symmetric tiers that are harder for fixed wireless and satellite to match.

Underpinning this is a substantial network upgrade. About 60% of Comcast’s footprint has now moved to mid‑split spectrum and virtualized architecture. Where full‑duplex (FDX) technology has been rolled out, trouble calls are down 20% and repair minutes 35%, providing the operating rationale for the capital deployed.

Wireless: convergence takes the strain

If broadband is the battleground, wireless is becoming the counterweight. Comcast is building a convergence story that rests heavily on mobile attaching to home connectivity, and the numbers are beginning to matter.

In 2025, Comcast added roughly 1.5 million net wireless lines, ending the year with more than 9 million and penetration of its residential broadband base above 15%. Wireless revenue grew 18% year on year in the fourth quarter; overall “convergence” revenue – broadband plus mobile – rose 2%.

The most aggressive weapon is the free‑line promotion. In the back half of the year, about half of new residential postpaid phone connections were free lines. Comcast’s bet is that this is a rational use of its economics: 90% of Xfinity Mobile traffic is offloaded onto its own Wi‑Fi network, customer acquisition costs are lower when selling into the installed broadband base, and customers who take both products show sharply higher lifetime value and loyalty.

Management is signalling that 2026 will be the year this strategy turns from drag to driver. They expect “the vast majority” of free lines to move to paid relationships in the second half, creating what Jason Armstrong called “a meaningful tailwind” to convergence revenue growth just as the company begins to lap the upfront costs of the 2025 go‑to‑market shift.

At the same time, Comcast is moving upmarket. A new premium unlimited tier – offering higher speeds, 4K streaming and guaranteed device upgrades – is reportedly seeing strong early adoption, broadening Comcast’s reach in the higher‑ARPU segment of the market that it did not initially target with its original by‑the‑gig offers.

Structurally, the mobile platform is being shored up. Comcast has “modernized” its long‑standing MVNO agreement with Verizon, a deal Cavanagh characterised as a foundation for “mutual profitable growth” for both parties and Charter. And later this year, T‑Mobile will become an additional network partner, initially for business customers, adding redundancy and negotiating leverage to what remains a capital‑light mobile model.

Business services: SMB headwinds, enterprise tailwind

Beyond the consumer arena, Comcast Business continues to present a mixed picture. Fourth‑quarter revenue rose 6% and EBITDA 3%, with the same divergence seen in recent quarters: modest growth in small and medium business, offset by strong momentum in enterprise solutions.

In SMB, fixed wireless is again the troublesome competitor, but Comcast is managing to hold its ground in part by pushing higher‑value services such as cybersecurity and business mobile, lifting ARPU. The enterprise business, meanwhile, is benefiting from rising demand for advanced, secure connectivity, and remains a declared investment priority.

Here too, the 2026 T‑Mobile MVNO partnership is expected to broaden the business‑mobile offer and deepen what Comcast sees as a converged connectivity opportunity across mid‑market and large‑enterprise clients.

Media and sports: Peacock narrows losses as NBA costs bite

On the media side, Comcast is in the middle of its own structural reshaping. The spin‑off of Versant Media – the cluster of cable networks facing the sharpest secular challenges – completed just after year‑end, leaving NBCUniversal with three core growth pillars: theme parks, studios, and an integrated domestic media business built around NBC and Peacock.

Media revenue rose 6% in the quarter, largely on Peacock’s momentum. The streaming service’s revenue grew more than 20% to a record $1.6 billion, with distribution revenue up over 30% as paid subscribers climbed to 44 million. Advertising on Peacock grew nearly 20%, helped by an exclusive NFL game and the launch of the NBA package. Overall advertising across NBCU was up 1.5%, with strength in the upfront, Sunday Night Football and the new NBA inventory offsetting lower political revenue.

The cost side is more sobering. Media EBITDA declined as Comcast began straight‑line amortization of its new NBA rights. Only about a quarter of season games fell in the fourth quarter; the first quarter of 2026 will carry roughly half of the season’s games and is flagged as the “peak EBITDA dilution” from NBA amortization.

Peacock’s Q4 loss widened to $552 million, reflecting both NBA and NFL costs, but on a full‑year basis losses improved by over $700 million. Management insists the path to breakeven is intact, driven by a mix of pricing (Comcast successfully pushed through a $3 price increase in late 2025 without derailing subscriber growth), advertising (including 170 advertisers on the NBA, 20% of them new, and the NBA inventory effectively sold out), and, over several years, richer affiliate fees as distribution contracts come up for renewal between 2025 and 2028.

Cavanagh was explicit: he sees no strategic advantage in separating NBCUniversal from the cable business. Parks and studios, he argued, do not need external capital or structural change to grow; the real work is executing on the integrated broadcast‑plus‑streaming model post‑Versant, using pay‑one films, live sports and news to differentiate Peacock in a crowded streaming field.

Comcast is positioning 2026 as a showcase year. NBC’s centenary coincides with a calendar packed with rights: the Super Bowl, Winter Olympics in Milan, the NBA All‑Star Game, MLB’s return to NBC and Peacock under a new deal, and the World Cup on Telemundo. Management expects another “meaningful” improvement in Peacock’s EBITDA even while absorbing a full year of NBA costs.

Epic Universe and the parks flywheel

If broadband is the problem child and Peacock the adolescent, theme parks look like the fully grown cash generator. The standout statistic of the quarter was parks EBITDA surpassing $1 billion for the first time, on the back of 22% revenue growth and 24% EBITDA growth.

The engine is Orlando’s Epic Universe, the first major US theme park launched in decades and one that Cavanagh called a “big swing” that is paying off. The park is not yet at full capacity, but it is already catalysing the wider resort: longer stays, higher per‑cap spending and higher hotel occupancy and room rates. Comcast added 2,000 rooms in Orlando; average daily rate there is up about 20%, with occupancy up three percentage points.

The strategy is to treat Epic not as a standalone asset but as a flywheel for the entire Orlando complex, with further operating leverage expected as ride throughput improves and attendance scales over the next several quarters. Japan, meanwhile, delivered its second‑best EBITDA year ever, while the global pipeline is filling out: the Universal Kids Resort in Frisco, Texas, is due to open in 2026, the first outdoor coaster at Universal Studios Hollywood is set to debut, and the company has secured national approvals for a new UK resort.

For investors weighing cyclicality, parks remain the clearest growth and returns story inside the media portfolio, with management signalling continued but disciplined capital deployment behind the brand.

Balance sheet, cash flow and capital returns

Beneath the segment stories sits a balance sheet that remains one of Comcast’s trump cards.

Free cash flow in 2025 reached a record $19.2 billion, helped by lower cash taxes, favourable working‑capital movements (especially lower studio production spend) and reduced capital spending. About $2 billion of the FCF came from a previously flagged one‑time tax benefit tied to an internal reorganization.

Total capital spending, including capitalized software and intangibles, fell 5% to $14.4 billion. Content and experiences capex dropped 17% to $3.6 billion, now that the heavy lifting on Epic Universe is largely done, while Connectivity & Platforms spending held steady at $10.5 billion. For 2026, Comcast expects total capex to be broadly flat, with both major segments “relatively consistent” year on year.

Net leverage ended 2025 at 2.3x EBITDA; the Versant spin will nudge that higher because the spun entity took some debt and cash flow with it. Comcast’s stated intention is to “migrate back” to 2.3x, signalling no appetite for balance‑sheet expansion despite recent noise in media M&A.

Shareholder returns remain generous. In 2025, Comcast returned nearly $12 billion via dividends and buybacks, including almost $7 billion in repurchases that reduced the share count by a mid‑single‑digit percentage. The board is keeping the annual dividend at $1.32 per share, but shareholders also received an in‑kind dividend in Versant shares; management framed this as effectively delivering higher total dividends in 2026 and sustaining what will be an 18‑year streak of dividend growth.

One warning flag: tax dynamics will be less friendly this year. The one‑offs that boosted 2025 cash taxes will not repeat, and the benefits from new tax rules, which Comcast had said would average $1 billion per year over five years, were front‑loaded. The 2026 benefit is expected to be “significantly lower,” and Versant’s exit removes a “significant pool” of operating cash flow.

What it means for investors

Strip away the corporate rhetoric and a clear trade‑off emerges. Comcast is consciously compressing earnings in its core connectivity segment to harden its broadband franchise, push customers onto simpler, stickier plans, and attach more mobile lines. That strategy, if executed well, should yield higher ARPU and lower churn over time, but the pain is real and concentrated in 2025 and early 2026.

Against that, parks are throwing off more cash, Peacock is edging towards profitability even as it swallows new sports rights, and the balance sheet gives Comcast the latitude to invest aggressively in its “six growth engines” while still returning capital.

For investors, the analytical challenge is timing. Management is drawing a line around 2026 as the year when major broadband migrations, mobile monetisation of free lines, and the first big wave of NBA dilution all wash through. Whether that translates into a visible turn in Connectivity & Platforms EBITDA, and a credible line of sight to sustainable media margins, will be central to how the market values a conglomerate that is increasingly trying to convince investors it is, at heart, a growth story again.