Broadband Market Trends & Competition
Q: How is the overall broadband market trending amidst intense competition?
A: The broadband market is still growing, albeit at a slower pace, with a healthy amount of net adds expected in 2024 and beyond. While competition is intense—especially from fiber (in about 50% of our footprint) and three fixed wireless competitors—we believe usage is increasing, with double-digit growth in broadband consumption. Over 70% of our subscribers are on speed tiers of 500 Mbps or higher, and nearly one-third are on gigabit speeds. We are confident in our strategy of investing in a better, ubiquitous network and superior products to compete effectively.

Wireless Strategy & Broadband Churn
Q: How does your wireless business impact broadband churn, and is wireless a stand-alone business or in service of broadband?
A: Wireless is an integral part of our overall strategy and is closely connected with broadband. It helps reduce churn and aids in acquisition, base management, and retention, though we don't disclose specific churn benefits. With 7 million lines and about 11% penetration, wireless is both a key growth opportunity and enhances broadband by adding value. We have introduced new mobile plans targeting multiline customers and continue to innovate with offerings like WiFi boost for our mobile customers.

Capital Allocation & Share Buybacks
Q: Has anything changed in your capital allocation or leverage approach given the apparent slowdown in share buybacks?
A: Our capital allocation strategy remains consistent, focusing on reinvesting in our business, maintaining a strong balance sheet, and returning capital to shareholders. Since restarting the buyback in 2021, we've repurchased over 15% of our share count, including over 6% in the last year. The apparent slowdown is due to acceleration of buybacks in the latter part of last year in anticipation of Hulu proceeds. We continue to value our credit rating and manage our leverage accordingly.

Impact of ACP on ARPU & EBITDA
Q: Can you maintain domestic cable EBITDA growth even with the Affordable Connectivity Program (ACP) subsidies going away?
A: Yes, we are confident in sustaining EBITDA growth despite the competitive market and the ACP transition. We continue to see tailwinds for broadband revenue growth, with ARPU growing 4.2% this quarter, exceeding our historical 3%–4% range. We have experience managing promotional roll-offs and ACP customers, and our segmentation strategy allows us to balance rate and volume effectively.

Peacock Content Strategy & Investment
Q: What is your approach to original content spending on Peacock, especially regarding the balance between sports and entertainment?
A: We're pleased with Peacock's progress, ending at 33.5 million subscribers. Our strategy combines both entertainment and sports, reflecting our strengths at NBCUniversal. Sports events like the NFL Wildcard game have driven subscriber growth and retention. We're investing in original content, with successes like our biggest original "Ted" and the reality series "Traders 2". Looking ahead, we have a strong content lineup, including the Olympics, NFL, Big Ten, and a robust movie slate.

Theme Parks Investment & Returns
Q: What are your expected investment levels in theme parks over the next five years, and how do returns compare to other businesses?
A: This year, CapEx in parks will remain at 2023 levels, and in 2025, with the opening of Epic Universe, CapEx will begin to step down. After that, we'll return to a more normal investment level, adjusting for new projects like the parks in Frisco, Texas, and Las Vegas. Returns on theme park investments are very strong, and we view parks as a stable, long-term pillar of our business. The response to our parks has been phenomenal post-COVID, and we're exploring opportunities in areas like gaming and live entertainment.

Fixed Wireless Impact on Business Services
Q: Are you seeing increased competition from fixed wireless in the business market, particularly at the low end?
A: Yes, the small and medium-sized business (SMB) market has become more competitive, with fixed wireless being part of that. We're experiencing some impact but are focusing on offering superior products, reliability, and ubiquity—crucial for businesses that require 24/7 connectivity. We have multiple segments within Business Services, including mid-market and enterprise, that offset this competition.

Segmentation Strategy with NOW Brand
Q: How have you structured the NOW brand to target the low end of the market without cannibalizing existing customers?
A: The NOW brand is a dedicated flanker brand strategy offering stand-alone products for the income-constrained segment. It includes prepaid broadband, prepaid mobile, and NOW TV, with simple, no-contract, and no credit check offerings at competitive, value-based price points—such as 100 Mbps for $30 and 200 Mbps for $45, inclusive of taxes and fees. By keeping it feature-light and distinct from our premium offerings, we aim to compete effectively in this segment while minimizing cannibalization.

Programming Expenses & Renewals
Q: How should we think about the impact on programming expenses as major contracts come up for renewal?
A: We evaluate each renewal on a case-by-case basis, focusing on overall cost relative to content, flexibility in a fast-changing environment, and consumer value. There's a significant transition between linear and streaming, and we aim to find win-win opportunities by leveraging our platform's ability to handle linear channels, on-demand, DVR, and streaming.