Industry Insider: Comcast’s Convergence Bet
Comcast wrapped up 2025 in the midst of a deliberate reset. The company generated $123.7 billion in revenue for the year, which was flat compared to 2024, while adjusted EBITDA fell slightly to $37.4 billion and adjusted EPS dropped to $4.31. However, beneath those headline figures, Comcast's leadership framed the year as one of transition, marked by significant investment, structural simplification, and strategic repositioning. At the heart of this repositioning is a renewed emphasis on convergence: combining broadband, wireless, streaming, and premium content into a single ecosystem aimed at driving long-term customer lifetime value rather than short-term margin growth.
Comcast's most visible pressure point remains residential broadband. In the fourth quarter, the company lost 181,000 broadband subscribers due to intense competition from fiber and fixed wireless providers. While broadband ARPU increased 1.1% year on year, management acknowledged that growth is slowing as Comcast moves away from promotional pricing and rate increases. Instead, the company has launched what executives call the most significant go-to-market shift in its history. Comcast has simplified its broadband offerings into four nationwide speed tiers with all-in pricing, unlimited data, and a five-year price guarantee, in an effort to reduce churn, rebuild customer trust, and stabilize the base before returning to growth.
That shift has come at a cost. Adjusted EBITDA for Connectivity and Platforms fell 4.5% in the quarter as Comcast incurred higher marketing, customer service, and product expenses as part of the transition. Management expects EBITDA pressure to persist through the first half of 2026 before easing as the company amortizes those investments and transitions the majority of customers to its new pricing structure.
If broadband is a pressure point, wireless is a relief valve. Comcast added 364,000 wireless lines in the fourth quarter and a record 1.5 million lines for the year, bringing the total number of wireless lines to over 9 million and broadband penetration above 15%. Almost half of new residential postpaid wireless customers in the quarter signed up through Comcast's free-line promotion, which is intended to reduce acquisition friction and convert customers into paying customers after one year. Executives emphasized that this is not a loss leader, but rather a deliberate funnel to higher lifetime value, with wireless now contributing significantly to convergence revenue growth.
Comcast also announced the modernization of its long-standing MVNO agreement with Verizon, as well as the addition of T-Mobile as a network partner for business customers. These partnerships enable Comcast to scale wireless profitably without requiring significant capital investment, while also leveraging its broadband footprint to offload approximately 90% of mobile traffic onto its own network. Wireless was framed by management as the connective tissue that strengthens customer loyalty across the entire connectivity portfolio, rather than as a standalone business.
Peacock's media business continued to grow in 2025, despite the fact that profitability remained elusive. Peacock's fourth-quarter revenue increased 23% to a record $1.6 billion, while paid subscribers increased 22% year on year to 44 million. Live sports, such as Sunday Night Football and the NBA's launch, drove nearly 20% growth in advertising revenue. However, this growth was accompanied by a $552 million EBITDA loss in the quarter, primarily due to the upfront cost of new NBA rights and an exclusive NFL game.
Management emphasized that, while NBA rights dilute EBITDA early on due to straight-line amortization, they expect the investment to pay off over time through advertising, subscriber acquisition, and increased engagement across both Peacock and NBC linear platforms. Importantly, Peacock's full-year losses improved by more than $700 million compared to 2024, reinforcing leadership's belief that the platform has achieved sufficient scale to reduce losses while absorbing premium sports costs.
While broadband and streaming dominate the headlines, Comcast's theme park division quietly delivered one of the company's best performances. Theme Parks revenue increased by nearly 22% in the fourth quarter, while EBITDA increased by more than 23%, exceeding $1 billion in quarterly EBITDA for the first time. The opening of Epic Universe in Orlando served as a catalyst for the entire resort, resulting in longer guest stays, higher per capita spending, and increased hotel demand. Executives described Epic not as a single-park victory, but as a boost to the entire Orlando ecosystem, reinforcing confidence in continued capital investment across the parks portfolio.
Despite earnings pressure, Comcast generated $19.2 billion in free cash flow for the fiscal year, aided by a one-time $2 billion cash tax benefit from a corporate reorganization. The company returned $11.7 billion to shareholders through dividends and share repurchases while keeping net leverage at a conservative 2.3x adjusted EBITDA. Looking ahead, Comcast reaffirmed its commitment to dividend stability while emphasizing disciplined capital investment over transformational mergers and acquisitions.
Taken together, Comcast's 2025 results show a company willing to tolerate short-term pain in order to reposition itself for the next phase of the media and connectivity wars. Broadband is being rebuilt around transparency, not promotional churn. Wireless is emerging as the primary driver of convergence. Peacock has achieved scale, but it must now demonstrate that this success can be translated into long-term profitability. Theme parks continue to serve as a high-margin growth engine, offsetting volatility elsewhere in the portfolio. Comcast believes that convergence, rather than pure-play focus, will be the driving force behind its success over the next decade.
