Chief Financial Officer at Comcast
Thanks Brian and good morning, everyone. I'll begin on Slide 4 with our second quarter consolidated 2022 financial results. Revenue increased 5.1% to $30 billion. Adjusted EBITDA increased to 10% to $9.8 billion. Adjusted EPS increased 20% to a $1.01 per share. And finally we generated $3.2 billion of free cash flow.
Now let's turn to our business segment results starting with Cable Communications on Slide 5. Cable revenue increased 3.7% to $16.6 billion. EBITDA increased 5.3% to $7.4 billion. Cable EBITDA margins improved 70 basis points year-over-year reaching a record high margin of 44.9% and net cash flow grew 4.4% to $5.3 billion.
Customer relationships are up 591,000 compared to last year and down 28,000 sequentially in the second quarter, reflecting lower levels of new customer connections given the current operating environment partially offset by low levels of churn, which remains well below 2019 levels. We are focused on delivering an excellent customer experience and monetizing our customer relationships over their lifetime and in in that regard, EBITDA per customer relationship grew by 3% in the quarter.
Now let's discuss Cable financials in more detail. Cable revenue growth of 3.7% was driven by broadband business services, wireless and advertising revenue, partially offset by lower video and voice revenue. Broadband revenue increased 6.8% reflecting an increase of 3.6% in ARPU and growth in our residential customer base compared to last year. Net residential and business customers increased by 775,000 over the past 12 months with flat results in the second quarter.
The trends that we saw through the second quarter have largely continued into the early parts of the third quarter with connects remaining soft while churn is still near all-time lows. This has resulted in a quarter-to-date loss of roughly 30,000 customers. July is typically the weakest month of the quarter and the vast majority of quarterly connect activity is weighted towards August and September, which is helped by back-to-school activity.
While we're optimistic that we will have a healthy back-to-school season, short term visibility remains low and more importantly, beyond this temporary period, we are confident that our broadband speeds, reliability, coverage and control features continue to position us as the best-in-class product for our customers, allowing us to protect and grow our 32 million broadband customer base over time.
Business Services, revenue increased 10% 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 average rates per customer and in our customer base, which grew by 54,000 compared to last year with 10,000 additions in the second quarter.
Moving to Wireless, revenue increased 30% mainly driven by service revenue, which was fueled by growth in customer lines. Overall, we added 1.2 million lines compared to last year, including 317,000 lines in the quarter, which was our highest net additions for any second quarter on record.
Advertising revenue increased 10%, mainly fueled by political revenue as well as strong growth at both our advanced advertising business free will, and at our streaming business Zumo, which was partially offset by decline in our local core advertising business. As a reminder, Zumo, which contributed about 20% of our advertising growth this quarter is now part of our Charter JV and beginning of the third quarter will no longer be reported in our Cable results.
For Video revenue declined 2.4% driven by customer net losses totaling $1.8 million compared to last year, including $521,000 net losses in the quarter, partially offset by 7% ARPU growth due to residential rate increase at the beginning of this year.
Last Voice revenue declined 12% primarily reflecting customer losses totaling $902,000 compared to last year, including $286,000 net losses in the quarter and reflects our shift in focus to bundling broadband with wireless.
Turning to expenses, Cable Communications second quarter expenses increased 2.5%. Programming expenses decreased 1.6% reflecting the year-over-year decline in Video customers partially offset by higher contractual rates. Non-programming expenses increased 5.2% driven by growth in our Wireless business, expenses related to our recent acquisition of Masergy and an increase in bad debt as we returned to more normalized levels and compared to lower levels last year. These higher costs were partially offset by decline in customer service expenses, reflecting lower activity levels in the business, as well as improvement in customer experience initiatives.
Wrapping up on Cable, we are very pleased with the 5.3% increase in EBITDA and record EBITDA margins. Even as we prioritize increasing investment in our network with capex intensity at nearly 11%, we generated a significant level of net cash flow, and we believe our ability to continue to generate strong and growing net cash flow out of the Cable business is sustainable.
Now let's turn to Slide 6 for NBCUniversal. Starting with total NBCUniversal results, revenue increased 19% to $9.4 billion and EBITDA increased 19.5% to $1.9 billion. Media revenue increased 3.6% to $5.3 billion, driven by Peacock with revenue up $444 million, which is more than three and a half times higher compared to last year. Distribution revenue increased 8.4% reflecting growth at Peacock, driven by increases in paid subscribers compared to last year and growth at our networks as higher contractual rates were only partially offset by linear subscriber declines.
Advertising revenue decreased 1.3% due to linear rating declines and a difficult comparison to last year when we had a higher number of sporting events and NHL, which we no longer have rights to, partially offset by a growing contribution from Peacock and higher pricing. Excluding the impact of sports timing and NHL advertising would have grown low single digits.
Media EBITDA decreased 2.9% to $1.3 billion in the second quarter, including a $467 million EBITDA loss at Peacock. Excluding Peacock, Media EBITDA increased nearly 4% driven by a decrease in sports costs associated with a lower number of events compared to last year and the absence of the NHL. 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, we expect losses to be higher in the second half, especially in the fourth quarter.
Moving next to Studios, revenue increased 33% to $3 billion driven by higher theatrical and content licensing revenue. Theatrical revenue nearly tripled compared to last year's results, driven by an increase in a number of releases, as well as the success of these films, including the outstanding results of Jurassic World: Dominion. Content licensing revenue was up 19%, mainly driven by growth in TV licensing as production has returned to pre pandemic levels.
EBITDA decreased $155 million to break even for the quarter, driven by an increase in programming and production costs associated with the higher content licensing and theatrical revenue in the current quarter, as well as an increase in marketing costs ahead of several film releases in late June and in July, including the very successful release of Minions: The Rise of Gru, Black Phone, and Nope.
Last at Theme Parks revenue increased 65% to $1.8 billion and we generated EBITDA of $632 million, which was a record level for any second quarter, even though Universal Beijing was closed for most of the quarter due to COVID-related restrictions. These results show strong improvement compared to last year when Hollywood was operating at limited capacity and Japan was closed for part of the quarter.
We continue to see strong demand and EBITDA growth at our US parks, where attendance and guest spending has been above 2019 levels, with Orlando delivering its highest level of EBITDA for any quarter and Hollywood experiencing its best second quarter EBITDA on record. Universal Japan has shown a nice rebound since capacity restrictions were lifted at the end of March with attendance having its strongest improvement since the pandemic and we expect momentum will build over the long-term.
Universal Beijing was closed for about two months and reopened at the end of June, resulting in an EBITDA loss at that part of this quarter. However, this was still a financial improvement compared to the level of pre-opening costs we incurred in the same period last year. Since reopening the parks, the trends have been positive, despite capacity restrictions and testing requirements. While COVID remains a risk, we must manage, particularly in Asia, we remain bullish on the Parks business, both in the near and long-term.
Now let's turn to Slide 7 for Sky, which I will speak to on a constant currency basis. For the second quarter, Sky revenue decreased 3.5% to $4.5 billion as low single digit growth in the UK was more than offset by our results in Italy and Germany, where we continued to transition through resets in our sports rights.
Direct-to-consumer revenue decreased to 2.4% reflecting consistent average revenue for customer relationship and a decline in customer relationships compared to last year, including customer losses in the quarter of $255,000, which partially reflects normal customer churn associated with the end of the football season, as well as an increasingly challenging macroeconomic environment for consumers across Europe.
Direct-to-consumer revenue in the UK increased low single digits in the quarter due to an increase in video revenue, primarily driven by higher revenue from pubs and clubs as they recover from the pandemic, as well as increases in wireless and broadband revenue. This growth in the UK was more than offset primarily by a decrease in revenue in Italy, due to the reset in our Syria broadcast rights.
Rounding out the rest of revenue at Sky content revenue declined 16% driven by the reset in sports licensing agreements in Italy and Germany, and advertising revenue decreased 3.1% with growth in the UK and Germany, despite a difficult macro environment, more than offset by decline in Italy.
Turning to EBITDA, Sky's EBITDA increased 71% to $863 million reflecting our strong growth in the UK and improved results in Germany and Italy, mainly driven by lower sports programming and production costs due to resets in our sports rights. As a reminder, the upcoming World Cup will take place in the fourth quarter, which is the first time this event has taken place during National League's regular season schedules.
To accommodate this national soccer leagues, including the EPL, we'll start the new season one to two weeks earlier in the third quarter, and then take a pause for a period of four game weeks in the fourth quarter while the World Cup is played. As a result, compared to last year, we will incur higher sports programming amortization in the third quarter with lower levels in the fourth quarter and higher again in the first half of next year.
Now I'll wrap up with free cash flow and capital allocation on Slide 8. We generated $3.2 billion of free cash flow this quarter. Cash taxes of $2.75 billion included some items that drove us above the normal run rate by roughly $600 million. Consolidated total capital increased 12% reflecting significant progress in building Epic Universe in Orlando, higher capital spending at Cable driven by investments in line extensions and scalable infrastructure, partially offset by a decrease at Sky.
For the year we continue to expect Cable capex intensity to stay around 11% as we work towards enhancing and transitioning our broadband network to DOCSIS 4.0 in the next several years, and NBCUniversal capex to be up around $1 billion dollars year-over-year, driven by the construction of Epic. Based on what we reported in the first six months of the year, that means total capital should be about $2.5 billion higher in the second half of the year compared to the first half.
Working capital was $1.7 billion for the first half of 2022 and is likely to be slightly below this amount in the second half of the year, reflecting the continued ramp in content creation and the timing of annual sports rights payments.
Turning to capital allocation, we repurchased $3 billion worth of our shares in the quarter. In addition, dividend payments totaled $1.2 billion for a total return of capital in the second quarter of $4.2 billion. We ended the quarter with net leverage at 2.3 times in line with our expectations for leverage to remain around 2.4 times 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.