Talk about them, but I won't. All right, everybody, we're gonna get started. For important disclosures, please see the Morgan Stanley research disclosure website at morganstanley.com. If you have any questions, please reach out to your Morgan Stanley sales rep. I'm Ben Swinburne, Morgan Stanley's media analyst, really excited to welcome to the conference, I think speaking for the first time, I believe, Mike Cavanagh, the now President of Comcast Corporation. Mike, thanks for being here. Thank you. Thank you. It's definitely not the first time, but maybe in this role. Yeah. Maybe at this company, I'm not sure. Been here before, but thanks for having me. Yeah. Good to be here. First time as president, I think is probably fair. Let's talk a little bit about the growth drivers, you know, for Comcast as you look forward. I think if we look at consensus estimates today, there's not an expectation of much financial growth in 2023. When you look out over the next two to three years, you know, can the business return to healthy growth? If it can, what are the drivers in your mind? Sure. I think it's a great question to start with. It's probably the most important question, you know, we'll hit. I'll get to the specifics, but if you don't mind, I'll just back it up a little bit and give you my perspective. 'Cause I've been, you know, saying for a long time that I think, you know, we've got the capacity, and I like the way you asked, look out several years, 'cause we don't manage the place one year at a time. We manage, you know, with a very long-term view. My view has always been that we're investing in the business to grow free cash flow and free cash flow per share over the long term, and I believe that's very doable, and that's, you know, been the message. When you go to the next step of just what are the big pillars that you have to think through to get from, you know, here to there, first is, you know, what's the backdrop? You know, we operate in the connectivity and platform space and the content and experiences space. If you just look at is there growth opportunity writ large for participants, us and others, in those spaces, I would say it's hard to argue that when you look at what has happened in the demand for data over networks by consumers and businesses on a backward-looking basis and the factors that have driven that and what we see around us, my expectation is that that's gonna keep going for a long time as an excellent backdrop for that business. The platforms business, which is sort of us being an aggregator and the sort of global toolkit we've built for, you know, sit on top of connectivity, and in particular, today help people navigate all the different D2C choices they have. You know, our X1, and we'll talk more about it, that world for the consumer is getting more complicated, not less, and the needs for good tools and services is a very strong backdrop. You know, content, interestingly, you know, we'll you know, was listening to the prior panel and in thinking about, you know, what's going on in the content business, the aggregate demand for entertainment, professionally produced, high-quality video entertainment is up, not down, measured in, you know, sort of hours consumed, despite the fact that over the past we've seen the dawn of, you know, social media and the and gaming that has taken up a lot of share of people's time, yet it hasn't taken away. I think the backdrop, again, strong there. Everything about, you know, the live experience as part of the business, our parks, you know, business. You know, nothing but opportunity in terms of people's appetite. Maybe it's particularly after COVID, but maybe it's the VelociCoaster. I mean, there's, you know, cool stuff. I know you're about to do your inaugural visit. I think the backdrop for growth is fantastic for the spaces in which we operate. You know, next would be, are there challenges? Sure, there are challenges, but are there, you know, the type of massive disruptions that take a player like us and say, "We don't have a path to get to fight for our share of that growth?" I think no. If you look at... We'll get into this deeper, but if you look at, you know, what kind of challenges would those be, I mean, on the network or connectivity side, physics haven't changed. You know, what our physical plan can do is, you know, versus fiber versus fixed wireless, but we'll get into deeper, is the same as it always was. Do we have competition? People choosing to deploy capital in ways to try to get a return and try to take some of the growth we see? Sure. That's competition, not disruption in the sense, you know. Then on the, you know, media side or the content side, yes, streaming's come along, but I think if we were sitting here three, four, five years ago, the prospect for the way the leaders were kinda running away with the prize, with a belief in a, you know, business model that was of, you know, such a high degree of certainty that, you know, people were saying, "You guys got no shot," you know. I don't think it's so clear where that's all going. I think, again, that speaks to we gotta manage our way through. There's pivot in some of these businesses. Why us, right? This is the importance. This is the important part. You know, when I think what we bring to the fight for that growth is a bunch of things. You know, one, start with leading businesses. You know, you think about through every dimension of where we are, you know, we're the leading, you know, cable provider and the internet provider in the United States. You know, we've invested heavily in our network. We've invested heavily in the platform, such that everybody in our space, all cable providers in Canada, many in the United States, Charter now, you know, using our kit, you know, and we'll get deeper on that. I think NBC, we reach 100 million, you know, viewers a month with our content. We're number two, you know, film studio. you know, obviously with Sky in the UK and Europe, we're the number one position with premium entertainment subscription services. We've got great positions. Second, we've got excellent operation. you know, our operational excellence I would put up against anybody. When you look at... That comes with that is really speaking to the leaders we have across all these businesses. At the top and going deep, lot of stability, lot of fighting through a lot of different business cycles. I think that matters a lot. I think if you sort of say, "Why buy the stock?" Like, you buy the stock because of that more than anything else. You know, we've got people who are deep in these businesses and know what they're doing. I got a lot of confidence in them. You see that in last year's results, 2022, despite the fact that we saw, you know, increased competition in broadband, we saw, you know, a slowdown in advertising, to name a few of the challenges. We still grew revenues 4%. We, you know, grew EBITDA, you know, 5%, 7% ex, you know, severance. EPS, 13%, and, you know, returned a lot of capital, which gets to the next point, financial strength. You know, we learned from, you know, living through interesting periods with other companies. You know, the first thing you need to have is margins. I think going back to the point about operating excellent, I think we have strong, if not the best margins across all of our businesses, combined with the strongest balance sheet in the space, 2.4 terms of leverage. That allowed us to return $18 billion of capital to shareholders last year, while still investing heavily in the future growth that I'll get into in a second. You know, that was Epic, that was the network, that was Peacock. Finally, and really important, is culture. Brian and his father and, you know, the leaders that preceded me and are all inside the place with me now, it comes in a lot of flavors, but one of the ones that's important is a bias to invest, a bias to think about the future, a bias to run the place like you own the whole company and think long, long-term. I think that dovetails back into the setup. If you go through the pieces now, connectivity, you know, that's, you know, $28 billion of revenues domestically in that space. You think about three key drivers of growth there in the near term are gonna be driving ARPU growth in broadband. It's capturing the opportunity in wireless, where we and Charter are off to a fantastic start. Business services, which over the last, you know, 15 years has been built into a $10 billion top line, $5 billion EBITDA business. Those drivers are strong, intact, producing regularly quarter by quarter by quarter. The one that's challenged in the recent past and will be for the near term, given the competitive landscape, is additional subs on the broadband side. We'll come back to that. I think we saw that in the second half of last year, and I'm still really pleased with the, you know, financial results and that we're intact, you know, for the future. Platforms I spoke a little bit about, but the one thing that, you know, is coming is between X1, Sky Glass, Flex. Now our shared product with Charter called Xumo. You know, we're getting to a single tech stack that rolls out this year, so all of those endpoints are gonna be fueled by the same technology that'll be, you know, best in class, and I think there's a lot of runway, you know, in that space. Content, you know, our growth there is really all around Peacock. When you think about Peacock, it's now $2 billion of revenues, 20 million subs. We added 10 million paid subs last year. Those are paid subs. 20 million added 10 last year. We like the momentum we're on. This year, you know, we'll see, you know, further growth without a doubt. That's gonna be a peak year of losses, but we're very much looking at that, how to run the media businesses in total to get to a place in due course where the bottom line of the total business is a grower again. Then finally in Parks, you know, it's a, it's a fantastic business. I think it made $400 million of EBITDA, the year of the NBC acquisition, and it's around $3 billion right now and going higher, right? 'Cause we've got a lot of, you know, great stuff. You know, the worry two, three years ago was people weren't gonna go back to parks post-COVID. Couldn't be further from the truth. We got a great investment agenda, and we will see a lot of growth in those businesses. Thought that was worth hitting all that as we got going, 'cause I do think the question on growth is, you know, clearly an important one. Hopefully that shared my thoughts on that one. No, that's a great intro. Let's talk a little bit more about the cable business, obviously the biggest part of the company from an EBITDA and cash flow point of view. You guys have been quite clear that you're prioritizing financial, you know, discipline and ARPU growth over chasing subscribers. Talk about why you think that's the right strategy and what should we all expect in terms of your ability to drive ARPU in a market that, as you acknowledge, is competitive? I think the... You know, you think about the capacity of our network to serve the high-end needs, right? Or the average and high-end needs. Something like 700 gigs a month is the average, you know, usage of a broadband-only subscriber. That's double what it was 4 years ago. You think about the speeds being taken by our customers, you know, 75% or so or above 400 gigs, gigabits of speed. You know, we've got something like a third of our customers taking 1 gig products or higher. We've got double the number of devices hanging off of our network. We've got 22 million Wi-Fi hotspots. It's staggering, the increased usage that we're seeing, going back to the earlier point. That is why you would believe that going after or protecting ARPU of the embedded base mid to high-end at a moment when we're seeing some competition, particularly from fixed wireless at the lower end, that's not where we see the long-term, you know, fight for growth and profits in the broadband business. Yeah. Is the short answer. My sense is that everyone probably underestimated fixed wireless coming into the market and the impact it would have. I do believe you guys, you know, and many other in the cable industry, think the technology has a limited addressable market in the long term. We had, you know, T-Mobile and Verizon here at the conference. Obviously, they're quite bullish on it. What have you learned so far in competing with fixed wireless that sort of gives you confidence and sort of informs your view that over the long term, you know, it's a more limited product and you guys have a really strong hand? Sure. Obviously you take all the work our engineers do to study this stuff up and down, as do, you know, others, and everybody obviously talks their own book a li-- you know, to a degree. You gotta all, you know, sort through that for yourselves. I think one of the things that's clearly the case is, you know, it taps out when you get to the kind of speeds we're talking about and the capacities we're talking about. You know, it's, it's a fine, you know, approach to market. It can work if you have, you know, lower needs. How long are... If the typical and average need of a consumer keeps going up, the person who might be satisfied today may not be satisfied tomorrow. You take one example, Thursday Night Football moved from, you know, network television to Prime Video. Viewership dropped in half, yet that night became the most, you know, the highest demand on our networks in the U.S. versus what had previously been Sunday night. You imagine where the world is going. Yeah. It's gonna continue to put, stress and strain in such a way that I really don't think the kind of consumer that the average consumer is going to find that that's gonna work. As you all know, it's not the most economically efficient way for the wireless companies to use that spectrum. Yeah. The day will likely come where they have to reprioritize how they, you know, use their spectrum, and that's gonna change the experience. Plus, it's a differentiated experience, you know, in one neighborhood to the next, on one house on a street versus another house on the street. That's all the testing that, you know, we've done, and those are some of the learnings that, you know, we wanna stick to the strategy of playing the long game against a high demand for a high quality, best in class, lots of latency, lots of durability, lots of reliability, lots of speed, lots of capacity, and that's what our roadmap is, you know, in broadband. To devalue that by, you know. We will with selective offers and what's right for different segments, you know, answer some of the competitive threat. We're not gonna lose sight of the bigger prize over the long term. You know, one technology people do not worry about in terms of its ability to be successful long term is fiber and fiber to the home. That's another area of competitive intensity that people are focused on. Can you talk about Comcast's current fiber overlap, where you see that's going over time, and how are you competing, you know, in those markets where you have a fiber competitor? Sure. This one we've talked about, year after year after year, you know, going back to Google Fiber, another threat. I mean, fiber's been a threat in our business for a long time, going back to Fios before my time and, you know, more recent competitors. I think we're now at 45%, you know, overbuilt. Sort of announced plans would take us to 60% overbuilt in the next, you know, several years. Probably, you know. I think we live in a world, and we have lived in a world where we've had to worry about fiber and compete against fiber. I think the sort of multifaceted answer to how we think about it is build the best network out there. Our path to, you know, DOCSIS 4.0 getting us to multi-gig symmetrical in a reasonable period of time with steps along the way, you know, we're the first to 1.2 gigs of speed. We're now we've got 10% of our network with mid-splits, you know, getting to, you know, 10 million homes with, you know, 2 gigs, we've increased, you know, down upstream speeds 5 to 10 times. We're way ahead of customer needs as our ability to handle the changing capacity during COVID demonstrated. We always wanna be ahead. We wanna be way ahead, That's why DOCSIS four oh is gonna quickly follow. We'll start that at the back end of this year and over several years get to a place where there'll be no difference between a fiber network's capabilities and our own, but we'll have a much more economically efficient way to get there, and we'll hang all of our innovation around wireless, Wi-Fi, and the like, and control the network that we've been known for around our product. We think with that, you know, we're gonna be able to compete, have competed well against, you know, the fiber builders, and we'll have an answer at all steps of the way. We spend a lot of time focused on that one. Yeah. You mentioned, sort of the, you know, future-proofing the network, through investment. Two questions. All around the sector, we're seeing CapEx go up as people are upgrading their network, and yet you've laid out a vision to sort of get to where you wanna go from a speed and capacity point of view within your existing capital intensity envelope. Maybe help us understand how you're able to do that and your confidence level. Number 2 is, you have not decided to sort of pursue significant line extensions, rural line extensions. Charter has. You know, talk about the philosophy as to why you've made the decision you've made so far. On the first part, our confidence that we can get to multi-gig symmetrical inside the envelope of around 11% capital intensity, you know, the first part of the answer is really, you know, where we start. Like, we've invested heavily in our network for all the reasons I previously described for years and years and years. From where we sit to where we have to get to, there's a path, and the advances in technology is fantastic, but like I said, from where we sit, the right path is, you know, mid-splits, more and more virtualization of our network onto the relatively manageable investment to get the network to DOCSIS 4.0. All that, when you average it out, should be cumulative, you know, $200 passing from where we currently sit, and that's, again, doable within the envelope of, you know, the capital, the CapEx intensity we've been running at in the recent past. To your second point within that, the growth. We do care about growth. The elements of our capital spend has always been CPE, which starts to come down in the environment we're in, sort of scalable infrastructure, which is making the existing network better and faster along the way, which is a lot of the splitting and virtualization that we talked about, and then, you know, line extensions. We Last year, we added 840,000 passings, about 1.4% of our base. We're gonna do up, you know, at least $1 million this year, and that's sort of in the envelope. When and if we see the ability to do more, we'll be happy to come back and say, "Hey, we wanna spend some more," you know. We see more opportunity. You know, we are return driven, so we look at, are we gonna get the acceptable returns for the investment? Which is a combination of what rate are you gonna get? What's churn gonna be over the long term? You know, how much is it really gonna cost you? What price can you charge, right? That's different in some markets than others, and you gotta get very local, very specific, and expect us to be biased towards doing that. When you go back to the question about rural, I mean, that's in two phases, right? The first phase we took a pass on, which is RDOF. Whole host of reasons. We were looking at other, you know, priorities at the moment. As we did that work, we did that math, and I don't think we would do it any differently today. We looked at it as a frothy capital markets, lots of, you know, bidders- Yeah ... driving prices to levels that were I would say, you know, not necessarily natural. Doesn't mean that, you know, players that got, you know, what they got won't do well, but that was a dynamic on our minds. That was. We wanted to see a little bit more maturity in the bidding process. Now that we've moved on to the variety of latest, you know, government programs, whether it be state, local, federal, and BEAD coming, we will be a participant in those. We don't see any reason not to be, but it's gonna be, you know, opportunity by opportunity, market by market. We certainly have a bias to, if it's gonna meet our hurdles, to be extending, you know, the footprint. Got it. Okay, well, maybe just to summarize and kinda wrap up this broadband conversation, there's other stuff we certainly wanna hit on. To put it all together, Mike, I mean, we think the industry is growing 3 million-4 million customers a year. If we assume that continues, putting everything we just talked about into the mix, so competition from fixed wireless, the fiber piece, but also your investments in the network and the product, do you think Comcast will get to a place where it's holding its share again? 'Cause we've seen the industry lose market cable lose share over the last couple years. When you look longer term, are you optimistic you can get back to holding share, maybe even expanding share? Yeah, I mean, I think it's the right way to frame the question. Why wouldn't we. Yeah ... be expecting and holding ourselves accountable, given everything I just described that, you know, in due course, and it's. The environment we're in, we're probably gonna be in for a little while. Yeah. This environment is one where it's tougher to, you know, add subs, and you can do the wrong thing for the long term by chasing, you know. We're not gonna do that. I do think that that settles down at a, at a point once, you know, the current commitments to fiber are built, when the fixed wireless guys. They pulled forward. Like you said earlier, they're doing better than people thought, but they're not pushing through what everybody originally thought the, you know, ultimate penetration would be. That's probably still gonna hold true. I think at some point that'll settle down. They'll start to see, you know, the dynamics of trying to lap, you know, their early successes. We intend to be in a position to compete well in that environment. I don't see why we wouldn't maintain our share. Okay, great. All right, we're gonna try to speed through some more cable questions to make sure we get to NBC. Wireless. You mentioned- Yep ... off to a really strong start, both yourselves and Charter. 1.3 million net adds last year, $3 billion business. For investors in Comcast, what is success in wireless? There's a couple different ways you could define that. Yep. I wanna make sure we should all be comfortable that you are comfortable with the MVNO structure in the long term. Yep. I think we've hit our milestones. Our early milestone was we wanted to scale the business up, make sure that we were making money in the wireless business. We get asked that question a lot. We make money, you know, in wireless. It's not an end all. It's all part of a big connectivity business. We wanted to make sure, you know, crawl, walk, run, as we got going. You know, in part, I think your question is what are we trying to get from it? We wanna make money, you know, in the wireless space. Absolutely. We most wanna make money in maximizing client lifetime value on a combined connectivity product, which is gonna be broadband and wireless. Knowing that wireless itself is accretive is a great part of that equation to the go then, fight the fight for growth that we talked about earlier. We are off to a, an excellent start. We got a lot of runway. We're at 9% penetrated against our broadband base. Charter's doing some interesting things and, you know, we'll be fast followers if there's, you know, stuff that we can do learning from them. In that sense, the sort of going after wireless, you know, like for like with shared infrastructure, same MVNO, I think that's actually a very constructive dynamic for us together with Charter. We'll keep driving that business. I think in terms of Very confident in the MVNO is working for us, right? It's capital light. We get, you know, day and date, you know, their Verizon's advances in their, in their product and network come to us, you know, same time it gets to them. Don't really see a reason to want for everybody who talked about owners' economics and the like, but without getting into the details, you know, of the actual agreement, we're happy with it. I see we do also have the ability to offload, you know, where it makes sense for us. Us, Charter, and ourselves are testing a way on whether that would make sense. I mean, I think you think about some of these numbers. 80% of the data traffic on Xfinity Mobile is over Wi-Fi, you know. Another interesting stat is, you know, 60% of the traffic, you know, that goes, you know, off network, is in 3% of our geographic footprint. We also, you know, own already spectrum that covers 80% of our footprint. There's a path there if that becomes feasible. We're gonna test, you know, a way at that. Remember, the scale and growth pace that Charter and us together are generating, you know, creates pretty good dynamics for wanting to be a served by the wireless industry, right? I think there'll also be advances as time passes in just the dynamics of, you know, these MVNO relationships. Okay. Great. All right. Let's shift to NBC. I wanna talk about Poker Face, but we don't have time. Let's talk about Peacock. Excellent for anybody who hasn't seen it. Gotta watch it. ... what is the sort of prize for investors with Peacock, and how do you think about how that fits into your overall media strategy? Well, like I said earlier, I think NBC, our both network and cable assets have among the best reach, best product as, you know, viewed by consumers, but obviously it's a linear product. We want to be on a journey to pivot that business to one where we become indifferent, much like we did in the cable business with cord cutting, to whether people are coming in the door through a digital, you know. ... side, Peacock, or through a linear side. So that's our goal. That's what we're investing against. Obviously, we started late with Peacock because we were doing something else that I'm sure you'll ask me about. You know, in, you know, a short period of time, we're now at 20 million paid subscribers. We focused on AVOD 'cause we have all the advantages of knowing distribution, knowing advertising, and the like. We've got a tremendous amount of properties from sports to the pay one window coming off of our movie studios that can feed the programming of these Peacock such that together, you know, we've got where we're doing two things. We're protecting the, you know, cash flows coming from the linear side, but we're also... our goal is to get to a place where, you know, where a peak year loss is now, where we, you know, get the aggregate back to where it was and then have opportunity for growth from there. That's, you know, really, we're not funding that with money coming from other places. It's sort of we have a great business, and we owe it to, you know, ourselves to take our, you know, take our best shot at what we think is, you know, a good business plan that washes its face. I think when you go back to what the world thought streaming was gonna look like several years ago to now, people, you know, I think it's a better setup for our strategy now than it was several years ago. Yeah. We gotta do it. We gotta prove it. Sure. We'll react accordingly as time passes. We've got a lot of flexibility to manage according to. Sure ... the data shows as time passes. You own a stake in Hulu, 30% stake. Bob Iger will be here tomorrow. He suggested publicly that, you know, buying in, that this, your stake is, which I think is in early 2024, that option, may not be Disney's priority. Do you see opportunities for a different outcome, either NBC acquiring their stake or maybe creating a new partnership going forward? Well, on this one, remember they and we, you know, back in 2019, we put together a very clear and good agreement for a put call that does happen in early 2024. We know what that looks like. We're very happy with it. If that's the way it plays out, that would be great. If there's something different that comes along, we have to consider things. You can simple to say, we won't do something unless it's better in our minds than that. I'll leave it there. Okay. All right. In our last 40 seconds here, you talked a lot about capital allocation. You guys have a very strong balance sheet, very cash flow generative. Investors are always focused on M&A with Comcast for obvious reasons given the history of the company. Are the transactions we've seen in the past from Comcast, mainly in content and international, sort of the best indicators of where you're focused for the future? How would you advise us to think about inorganic growth? Sure. I think, you know, Brian and I have been saying this for a while now, I'll say it again. I mean, we like the opportunities we have for investing in growth and generating free cash flow growth from the existing set of businesses we have. To execute what I previously described, we don't have to do anything. I think the bar is high for what we would be looking for, you know, for M&A to do for us. You know, you never say never because it's our job, to consider everything that comes along. I think it's different when you feel strategically incomplete versus when you're happy with what you have and then, you know, any acquisitions become something of am I gonna buy or am I gonna build? Much like we did, you know, very much like the tuck-i n acquisition we did in business services on the connectivity side last year, two years ago now in Masergy. Things like that are, they're strategically aligned, and they get us to where we otherwise wanna go faster. I think that's how I would think about, you know, M&A for now. Okay. Mike, to wrap up, how would you summarize Comcast position and the sort of growth outlook from here? Yeah. Sure. I think, we'll go back to the beginning. I mean, I think we do have, an excellent set of businesses, but most importantly, I think we've got a team of people and leaders that are, best in class and running businesses in a fashion that for the hand we've got, I wouldn't trade anybody else's spot. I think we've got great opportunities to grow. We enumerated them, and I would, put our money on us to go deliver against that. Okay. Thanks everybody. Mike, thanks so much for being here.