Comcast president Mike Cavanagh addressed the ongoing SAG-AFTRA and WGA strikes during the NBCUniversal parent company’s second quarter earnings call Thursday.
“We are committed to reaching a fair deal with the guilds as soon as possible,” Cavanagh said. “Beyond that, for all involved in the industry, broadly, a prolonged work stoppage and the longer it goes, the worse it’ll be. It is obviously going to have a negative impact all around.”
The WGA work stoppage has been ongoing since May 2, while SAG-AFTRA went on strike July 14.
The strikes have brought scripted film and TV production to a standstill across Hollywood as the actors and writers unions continue picketing against the studios repped by the AMPTP.
“As you look at Peacock, I wouldn’t point out anything in particular related to strikes and its effect in 2023, the second half of the year,” Cavanagh told analysts Thursday. “Obviously, the longer a strike, the more that could have an effect, as you look into 2024 and beyond. And that would be for ourselves and others, obviously, so it’s a level playing field. But to comment on Peacock in particular, in the second half [of the year], we’ve got a lot of strong content coming. We’ve got the NFL coming back. Obviously then, on top of that, we have an exclusive NFL Wildcard Game. We’re going to air Big 10 for the first time, which is fantastic, on Saturday nights. In movie slates, we’ve got ‘Super Mario Bros.’ coming to Peacock shortly, we’ve got ‘The Exorcist,’ ‘Five Nights at Freddy’s’ coming from Blumhouse and then on TV, some originals, including ‘The Continental,’ which is related to the ‘John Wick’ franchise. So we feel very good about the strength of what we have coming in the second half of the year content-wise.”
Comcast reported Thursday that Peacock had added just 2 million new subscribers in Q2 — the majority of which were conversions of users who previously received Peacock for free through their Xfinity subscriptions — and that the streamer had lost $651 million during April-June period.
During the call, Comcast CEO Brian Roberts said there will be “no change” to the company’s projection of an estimated $3 billion in losses at Peacock this year, guidance that was first given in January. This $3 billion mark was positioned as the expected “peak” in losses for Peacock, which Comcast forecasts will “steadily improve” post-2023.
Cavanagh added that there is “nothing to quantify in the context of our company” regarding the dual strike’s potential effect on free cash flow, and “it’s all manageable,” however, “it will shift studio working capital out of the near term and into the future.” “So probably for 2023, a little bit of lower working capital, higher free cash flow and the flip side of that in 2024,” Cavanagh said.
Additionally, the Comcast president says the media giant is “not quite halfway through” its mission to convert Comcast subscribers over to a paying subscriber status on Peacock, following the end of its complementary sub package in June. “So when you look at the doubling of Peacock subs year over year, I’m optimistic about what the second half of the year brings feel pretty good about Peacock,” the Cavanagh said.
Earlier this month, NBCUniversal was reorganized into four key units under Cavanagh: NBCUniversal Studio Group, led by film chief Donna Langley, NBCUniversal Media Group, run by chairman of TV and streaming Mark Lazarus, NBCU News Group, run by existing news boss Cesar Conde, and the Universal Destinations and Experiences Group, headed up by parks boss Mark Woodbury.
The shakeup in leadership, which included the ousting of TV chief Susan Rovner, exits the company was the first major restructuring move made by Cavanagh since he took direct oversight of subsidiary NBCU upon the ousting of CEO Jeff Shell in April.
During the Q2 earnings call, Cavanagh shot down the idea Comcast could be interested in an ESPN deal with rival Disney at this time. His comments come after Disney chief Bob Iger said in a July 13 interview with CNBC that the Mouse House was looking for a strategic partner for ESPN.
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