Sky hits 24m subscriber barrier as full-year revenue down 3 per cent

European pay-television broadcaster Sky recorded both revenue and subscriber increases for the fourth quarter of 2019, but a fall in total revenue for the full year, according to results presented today by parent company, Comcast.

The US-based telco and media conglomerate said that Sky’s fourth-quarter revenue rose by 0.4 per cent year-on-year to $5.04bn (€4.56bn), but full year revenue dropped three per cent to $19.22bn.

Subscriber numbers showed a healthy increase for the full year, however with 394,000 net additions. Sky added 77,000 subscribers (net) in the fourth quarter for the total figure to sit at 24 million by year end.

Sky’s direct-to-consumer revenue increased 1.1 per cent to $4bn in the fourth quarter, driven by the increase in customer relationships. Content revenue rose by 2.1 per cent to $371m, reflecting higher rates for wholesaling of programming.

However, advertising revenue decreased 5.1 per cent to $647m, reflecting what Comcast described as an “unfavourable impact” from a change in legislation related to gambling advertisements in the UK and Italy, as well as overall market weakness.

Comcast said that Sky’s fourth-quarter Pro Forma Adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) was $765m and consistent with the prior year period.

Looking ahead to 2020, Comcast chairman and chief executive, Brian Roberts, said the company is set to make some investments in Sky that will “build growth for the years beyond”.

In September 2018, Comcast saw off competition from media group Fox to secure a 61-per-cent stake in Sky, which operates in the UK, Ireland, Germany, Austria and Italy. Comcast won with a bid of £17.28 (€20/$22.19) per share, while Fox’s final bid was £15.67.

Comcast itself saw its revenues rise by two per cent in the fourth quarter to $28.4bn, with full-year significant revenue soaring to $108.94bn (up 15.3 per cent). Comcast’s US media group and Olympics broadcast rights-holder, NBCUniversal, suffered revenue losses for both the quarter and the year. For the quarter, revenue fell by 2.6 per cent to $9.15bn, with a five-per-cent full year drop to $33.97bn.

Comcast noted that last year’s results included an incremental $1.6bn of revenue generated by the broadcasts of the 2018 PyeongChang winter Olympics and the NFL’s Super Bowl LII at NBCU’s TV businesses.

For the 12 months ended December 31, 2019, broadcast television revenue decreased 10.3 per cent to $10.3bn compared to 2018, primarily reflecting a decrease in advertising revenue. However, Comcast said that excluding $770m of revenue generated by the broadcast of PyeongChang 2018 in the first quarter of 2018 and $423m of revenue generated by the Super Bowl broadcast, broadcast television revenue of $10.3bn was consistent with the prior year period.

Today’s results come just days after Comcast and NBCU unveiled their new Peacock subscription streaming video service, which will contain a significant amount of live sports coverage, including extensive coverage of this summer’s Tokyo Olympics.

The OTT platform, which will roll out nationwide in the United States on July 15, nine days before the Summer Games, will feature live coverage of the Opening and Closing Ceremonies before they air on NBC in primetime. It will also stream three daily Olympic shows, Tokyo Live, Tokyo Daily Digest, and Tokyo Tonight.