Michael Cavanagh
Senior Executive Vice President & Chief Financial Officer at Comcast
Thanks, Brian and good morning, everyone. I'll begin on Slide 4 with our first quarter consolidated 2022 financial results. Revenue increased 14% to $31 billion; adjusted EBITDA increased 9% to $9.2 billion; adjusted EPS increased 13% to $0.86 per share; and finally, we generated $4.8 billion of free cash flow.
Now let's turn to our business segment results, starting with Cable Communications on Slide 5. Cable revenue increased 4.7% to $16.5 billion, adjusted EBITDA increased 6.5% to $7.3 billion and net cash flow grew 8.3% to $5.6 billion. We grew customer relationships by 913,000 over the past 12 months with 194,000 net additions in the first quarter. Overall, customer growth was driven by broadband, where we added 1.1 million net new residential and business customers over the past 12 months and 262,000 in the first quarter. This quarter's results reflect continued low move-related activity compared to historical levels as well as an uptick in the level of competitive activity resulting in lower connect volumes. At the same time, we continue to experience very high levels of customer retention, with this quarter's results yielding the lowest churn rate for any quarter on record. In fact, we had fewer customers disconnect this quarter than the first quarter of 2019 despite a customer base that is almost 17% larger.
Throughout the pandemic, we have offered a variety of programs to help our customers stay connected. Some of our customers that participated received our services for free and therefore, were not included in our subscriber totals. At year-end, we ended these COVID-related programs, triggering a benefit in the first quarter. We estimate this change accounted for about 1/3 of our first quarter net additions with such benefit contained to the first quarter.
Moving to the financials. Cable's revenue growth of 4.7% was driven by broadband, business services, wireless and advertising revenue, partially offset by lower video and voice revenue. Broadband revenue increased 8%, driven by strong customer additions over the past 12 months and nearly 4% growth in average revenue per customer in the quarter.
Business Services revenue increased 10.6% or approximately 6%, excluding the acquisition of Masergy which closed at the beginning of last year's fourth quarter. This healthy organic growth was driven by increases in both average rates per customer and in our customer base which grew by 61,000 over the past 12 months with 9,000 additions in the first quarter.
Moving to wireless; revenue increased 32%, mainly driven by service revenue which was fueled by growth in customer lines. Overall, we added 1.2 million lines over the past 12 months, including 318,000 lines in the quarter which, for the fifth consecutive quarter, was our best result since launching this business in 2017. Advertising revenue increased 8.6%, reflecting higher political and double-digit growth in Zumo and advanced advertising. For video, revenue declined 1.5%, driven by customer net losses totaling $1.7 million over the past 12 months, including $512,000 in the quarter, partially offset by higher average revenue per customer due to a residential rate increase at the beginning of this year.
Last, voice revenue declined 9.8%, primarily reflecting customer losses totaling 725,000 over the past 12 months, including 282,000 net losses in the quarter and reflects our shift to more converged broadband mobile offers.
Turning to expenses; Cable Communications' first quarter expenses increased 3.3%. Programming expenses decreased 1.1%, reflecting a decline in video customers, partially offset by higher rates. Nonprogramming expenses increased 6.3%, reflecting investments in our growth businesses, including broadband, wireless and business services; expenses related to our recent acquisition of Masergy; as well as an increase in other expenses, primarily due to bad debt returning to more normalized levels. These higher costs were partially offset by a decline in customer service expenses, reflecting lower activity levels in the business as well as improvement in customer experience initiatives.
Cable Communications' EBITDA increased 6.5% to $7.3 billion for the quarter and Cable EBITDA margin reached 44%, reflecting 80 basis points of year-over-year improvement. We believe we are striking the right balance by continuing to invest in our growth businesses which are driving the top line and proving to be a great return for us, while at the same time, continuing to increase our operating efficiency and remove unnecessary costs.
Now let's turn to Slide 6 for NBCUniversal. Starting with total NBCUniversal results, revenue increased 47% to $10.3 billion and EBITDA increased 7.4% to $1.6 billion. Media revenue increased 36% to $6.9 billion, including Peacock revenue which grew more than 5x year-over-year to $472 million in the quarter. As Brian noted earlier, we aired both the Olympics and Super Bowl which together contributed an incremental $1.5 billion to Media revenue. Excluding these events, Media revenue increased 6.9% driven by both higher distribution and advertising revenue. Distribution revenue, excluding the contribution from the Olympics, increased 8.5%, reflecting growth at Peacock driven by increases in paid subscribers as well as our networks, reflecting higher contractual rates, partially offset by linear subscriber declines. Advertising revenue, excluding contributions from the Olympics and Super Bowl, increased 4%, reflecting higher pricing and a growing contribution from Peacock which was partially offset by linear ratings declines.
Media EBITDA decreased 21% to $1.2 billion in the first quarter, including a $456 million EBITDA loss at Peacock. Excluding Peacock, Media EBITDA decreased 7.7%, reflecting higher programming and production costs associated with our broadcast of the Beijing Olympics and Super Bowl as well as higher costs driven by the return of our full primetime schedule compared to last year when our schedule was impacted by COVID-19. We continue to expect Peacock's EBITDA loss will be roughly $2.5 billion for the year. However, taking into consideration the timing of content launches, consistent with what Brian mentioned, we would expect losses to be higher in the second half of the year.
Moving next to Studios. Revenues increased 15% to $2.8 billion, driven by higher content licensing and theatrical revenue but EBITDA declined 51% to $245 million. The decline in EBITDA primarily reflects a difficult comparison to last year's first quarter which benefited from a licensing deal with Peacock, including exclusive streaming rights for The Office with an offsetting adjustment reflected in NBCUniversal's eliminations. The remainder of the EBITDA decline reflects higher marketing costs ahead of numerous film releases planned for the second quarter, including Jurassic World Dominion, Ambulance and Bad Guys.
Last, at Theme Parks, revenue increased by $941 million to $1.6 billion and we generated EBITDA of $451 million, reflecting improved results at each of our parks compared to last year when Orlando and Japan were operating at limited capacity and Hollywood was closed due to COVID-19. We continue to see exceptional demand at our domestic parks, attendance was back to prepandemic levels and we had strong growth in per caps with Orlando generating its highest EBITDA on record for a first quarter.
COVID impacts in the quarter were more pronounced internationally. Universal Studios Japan's results were impacted by capacity restrictions which were in place for most of the first quarter. These restrictions were lifted at the end of March. And over the last month, we have seen a very strong rebound with attendance currently above pre-pandemic levels. At Universal Beijing which opened in September of last year, demand from our guests was high but overall attendance was impacted by COVID and related travel restrictions. Despite that, Beijing only contributed a slight EBITDA loss in the quarter.
Now, let's turn to Slide 7 for Sky which I will speak to on a constant currency basis. For the first quarter, Sky revenue of $4.8 billion was consistent with the same period last year as solid growth in the U.K. was offset by our results in Italy, where we continue to transition through the reset in our Syria broadcast rights which we won't begin to lap until the back half of this year. Direct-to-consumer revenue was also consistent year-over-year, reflecting growth in the U.K., where we continue to have healthy customer additions and grew direct-to-consumer revenue by mid-single digits driven by an increase in video revenue, including higher revenue from pubs and clubs, streaming and premium TV as well as healthy increases in broadband and wireless revenue. This growth in the U.K. was mainly offset by lower revenue in Italy, where we continue to experience both customer losses and lower direct-to-consumer revenue, primarily due to the reset in our Syria broadcast rights.
Rounding out the rest of revenue at Sky, content revenue declined 14%, driven by the reset and sports licensing agreements in Italy and Germany. And advertising revenue increased 7.9% and with healthy growth in the U.K., partially offset by a decline in Italy.
Turning to EBITDA. Sky's EBITDA increased 71% to $622 million driven by our strong performance in the U.K. and improved results in Italy and Germany, where we benefited from lower sports programming costs due to resets in our sports rights.
Next, I'll discuss free cash flow and capital allocation on Slide 8. As I mentioned earlier, we generated $4.8 billion in free cash flow this quarter. Consolidated total capital increased 1.1%, reflecting increases at NBCU due to ramping construction at Epic Universe, a decrease at Sky and a relatively flat capital spending at Cable due to timing. For the year, we continue to expect Cable capex intensity to stay around 11% as we increase investment in our broadband network and NBCUniversal capex related to the construction of EPIC universe to be up around $1 billion year-over-year.
Turning to capital allocation. As of today, we have repurchased $4 billion worth of our shares year-to-date, including $3 billion in the first quarter. In addition, dividend payments totaled $1.2 billion for a total return of capital in the first quarter of $4.2 billion.
And before I wrap up, I also want to spend a minute on the macro environment since inflation and interest rates are topical right now. There are certain areas of expense across each of our businesses that are impacted by inflation. Like other companies in our space, we're not entirely insulated from that. However, the overall impact to our financials has been limited. Overall energy costs make up about 1% of our total company's operating expenses. Also, we are more than offsetting any pressure on wages and other areas of expense through the continuing efforts to implement operational efficiencies, helping us protect the healthy margins across our businesses.
Lastly, our balance sheet is very well positioned with about 95% of our debt based on fixed rates, a debt portfolio with a weighted average time to maturity of approximately 18 years and a weighted average interest rate of 3.47%. We ended the quarter with net leverage at 2.3x and still expect to remain around 2.4x leverage going forward.
So with that, thanks for joining us on the call this morning. I'll turn it back to Marci, who will lead the question-and-answer portion of the call.