business
Moody’s Places Comcast Debt Ratings Under Review for Downgrade
Moody’s placed Comcast’s debt ratings on review for a downgrade after the company announced plans to spin off its NBCUniversal and Sky media assets into a separate public company. The agency cited reduced revenue diversification and increased exposure to broadband competition as reasons for the review.
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Moody’s placed Comcast’s debt ratings on review for a downgrade after the company announced plans to spin off its NBCUniversal and Sky media assets into a separate public company. The agency said the separation would concentrate the remaining entity’s exposure to intensifying competition in broadband markets.
It noted that the credit resilience of cable broadband business models remains under pressure due to debt leverage in conflict with negative operating trends.
Background on the Planned Separation Comcast previously spun off its linear cable TV networks to shareholders as Versant Media Group. The post-spin NBCUniversal will include NBC, Peacock, Bravo, Telemundo, film and TV studios, theme parks, and the Sky division in Europe.
Moody’s said the company currently benefits from revenue diversity from its media, studio content, and theme parks portfolio, but these are lower-margin businesses compared with broadband operations. The agency added that persistent secular pressures in the low-margin linear video pay-TV business elevate the importance of maintaining sizable broadband cash flow.
It stated that negative secular pressures on the Connectivity and Platforms segment are heightening overall business risks. The credit ratings previously carried stable outlooks.
