NBCUniversal And Comcast Execs “More Confident” Than They Were A Year Ago In Peacock Profit Outlook, Jeff Shell Says

NBCUniversal CEO Jeff Shell said execs at the company and parent Comcast are "more confident" than they were a year or two ago that investments in streaming service Peacock will soon yield profits. How soon remains a bit unclear, however.

"We've been clear from the start that we're going to see a return on that investment — I think we feel better about that now based on where we are," Shell said during Comcast's fourth-quarter earnings call.

The company said Peacock had passed 20 million subscribers by the end of 2022, more than double its size at the start of the year. It added 5 million subscribers in the quarter thanks to Spanish-language World Cup coverage as well as original programming, other live sports and the addition of first-window movie titles and NBC and Bravo series that used to go to Hulu.

Over the rest of the year, CEO Brian Roberts said, "subscriber cadence will follow content launches, which will fall more heavily in the second half of 2023" than in the first half. President Mike Cavanagh, who recently was promoted from his previous CFO post, said losses at Peacock will rise to $3 billion this year from $2.5 billion in 2022. He reiterated previous guidance that the $3 billion level will represent "peak losses" for Peacock.

Asked directly about when break-even will officially be achieved at Peacock, Cavanagh and Shell did not answer or reaffirm any past outlook. Unlike rival players like Disney and Warner Bros Discovery, NBCU and Comcast have never revised the projections they offered investors before they entered the streaming arena. In early 2020, they projected reaching 30 million-35 million active accounts by 2025 and break-even by 2024, with revenue of $2.5 billion. By 2022, revenue was already at $2.1 billion, triple the 2021 figure, according to the earnings report. Strategy-wise, at launch the company was more focused on the free, ad-supported tier of Peacock but has since pivoted toward paid subscribers.

"It's very clear that we picked the right business model given where we are," Shell said. "We wouldn't be investing in Peacock if we didn't think it was going to return the segment to growth over time. … could not be more positive about our trajectory. We're right where we expected to be in terms of investment and we're well above where we expected to be as far as paid subs, which is going to pay off."

Unlike Disney+, which drew 10 million signups upon its launch in November 2019, or HBO Max, which benefited from the pre-existing HBO subscriber base of tens of millions, Peacock faced a tough slog in the early going. Covid forced a delay of the Tokyo Olympics, which had been slated to be the launch platform for the service. Other sporting events and original programming were also badly hampered by the pandemic, and crucial distribution deals with Amazon and Roku took months to develop after the launch.