Comcast’s US$3.8-billion purchase of DreamWorks Animation in April has paid off for the US cable giant’s fourth-quarter earnings, which grew, in part, from higher theme park, film and broadcast television revenues.
According to S&P Global media and entertainment equity analyst Tuna Amobi, theme parks and consumer products were particularly big reasons why Comcast acquired DreamWorks, The businesses provide Comcast with a leg up against Disney, especially in China, where DreamWorks already has a relationship with its Oriental DreamWorks JV.
Comcast reported a 32.1% revenue increase to US$1.3 billion for its NBCUniversal theme parks division in Q4 2016. The success of Hollywood’s The Wizarding World of Harry Potter and the impact of a stronger Japanese Yen drove the results.
Operating cash flow for theme parks rose 42% to US$640 million in the quarter. Operating cash flow reflected by NBCUniversal’s new 51% stake in Universal Studios Japan, meanwhile, increased by 18.4%, reflecting higher revenue and partially offset by an increase in operating expenses, including costs to support new attractions.
For the year ended December 31, theme parks revenue grew by 48.2% to US$4.9 billion.
Looking at Q4 revenue for filmed entertainment, including a full quarter attributable to DreamWorks, revenue increased by 13% to US$1.8 billion.
Theatrical revenue for Q4 shot up 97%, mostly due to the box-office success of Illumination Entertainment’s animated film Sing (pictured). Its newly announced sequel, Sing 2, is expected to hit theaters on December 25, 2020.
The DreamWorks acquisition, along with the timing of content licensing agreements, also factored into a 38% rise in content licensing revenue.
In addition, other film segment revenue increased by 56%, primarily driven by the inclusion of DreamWorks.
Operating cash flow for the division, however, dropped 15.3% to US$121 million, reflecting higher revenue, and offset by increased expenses, including integration and restructuring costs, driven by DreamWorks.
On the broadcast television side, Q4 revenue rose by 14% to US$2.8 billion due to higher ad, content licensing and distribution sales.
NBCUniversal’s overall Q4 revenue was up 13% to US$8.5 billion. Comcast also reported that it grew its pay-TV subscribers for the full year (161,000 new subs) for the first time in 10 years.