Key Stats
- Current Price: $28
- Q1 2026 Revenue: $31.5B, +5.3% YoY
- Q1 2026 Adjusted EPS: $0.79, -27.5% YoY
- Q1 2026 Adjusted EBITDA: Declined 9% YoY
- Q1 2026 Free Cash Flow: $3.9B
- Capital Returns (Q1): $2.5B returned, including $1.25B in share repurchases
- TIKR Model Price Target: $49
- Implied Upside: ~80% over almost 5 years (around 14% annualized)
omcast Stock Posts Revenue Beat, But Margin Pressure Deepens
Comcast stock delivered (CMCSA) Q1 2026 revenue of $31.5B, up 5.3% year-over-year from $29.9B in Q1 2025, with adjusted EPS of $0.79 for the quarter.
The headline beat was heavily event-driven: the Milan Cortina Winter Olympics, Super Bowl LX, and the NBA All-Star Game across 17 days in February generated approximately $2.2B of incremental revenue, according to CFO Jason Armstrong on the Q1 2026 earnings call.
Excluding those events, revenue grew at a low-single-digit rate.
Theme Parks delivered the sharpest underlying growth, with revenue up 24% and EBITDA up 33%, fueled by strong consumer demand at Epic Universe and higher per-capita spending across the Orlando resort, according to Armstrong on the Q1 2026 earnings call.
Business Services revenue grew 6% with EBITDA up 4%, driven by enterprise customer additions and advanced solutions momentum.
The Connectivity and Platforms segment remains in a deliberate investment phase, with broadband ARPU down 3.1% as simplified pricing and free wireless line bundling weighed on revenue per customer.
The segment posted an EBITDA decline of 4.7%, a result management said was consistent with guidance from the Q4 2025 earnings call.
The key operational signal: broadband net subscriber losses narrowed to 65,000, an improvement of 117,000 year-over-year and the first such improvement since Q4 2020, according to Armstrong on the Q1 2026 earnings call.
Wireless net additions reached 435,000 in Q1, the strongest quarter on record, with penetration at 16% of the domestic residential broadband base, according to Connectivity and Platforms President Steve Croney on the Q1 2026 earnings call.
Peacock added 2 million net subscribers sequentially to reach 46 million paid subscribers, with revenue up more than 70%, though the platform posted an EBITDA loss of $432M on peak NBA rights amortization.
Management guided that Q2 would mark a meaningful inflection, with Peacock expected to approach profitability for the first time and ARPU pressure expected to ease as free line conversions accelerate in H2.
Comcast returned $2.5B to shareholders in Q1, including $1.25B in buybacks and approximately $1.2B in dividends.
Comcast Stock Financials: Three Cost Cycles Compress Every Margin Line
The Q1 2026 income statement reflects NBA rights absorption, the broadband pricing reset, and peak Legendary February marketing all flowing through at once.
Gross margin fell to 65.4% in Q1 2026 from 71.8% in Q1 2025, continuing a deterioration that accelerated after Q2 2025, when gross margin had held at 75%.
Operating income fell to $4.1B in Q1 2026 from $5.7B in Q1 2025, a decline of approximately 27% year-over-year.
Operating margin compressed to 13.1% in Q1 2026 from 18.9% in Q1 2025, a contraction of nearly 6 percentage points.
The sequential trend is modestly constructive: operating margin was 10.8% in Q4 2025 before recovering to 13.1% in Q1 2026, though both figures remain well below the 18.9% to 19.8% range posted through the first half of 2025.
Armstrong noted that Q1 represented peak NBA-related dilution for the year, given approximately 50% of games were played in the period, with the cost profile expected to improve from Q2 onward, according to his prepared remarks on the Q1 2026 earnings call.
Valuation Model Take
The TIKR model prices Comcast stock at $49 against a current price of $28, implying approximately 80% total upside over ~5 years at 14% annualized.
The mid-case model assumes a revenue CAGR of 1.9% and a net income margin of 11.6% through 2035, modest assumptions relative to Comcast’s 10-year historical revenue CAGR of 5.2%.
Q1’s results add near-term noise to the investment case: the revenue beat was inflated by $2.2B of non-recurring event revenue, and operating margins are running well below normalized levels as three cost cycles overlap.
The investment case for Comcast stock rests on whether broadband stabilization, wireless monetization, and NBA cost normalization converge into a margin recovery through late 2026 and into 2027, a plausible path but one with meaningful execution dependencies.
At $27.56, the stock is priced as though the current cost headwinds are permanent rather than transitional, and the TIKR model suggests that gap narrows materially if management delivers on its H2 2026 recovery roadmap.
The Q1 report shows real operational progress in broadband and wireless, but the margin recovery requires free line monetization, ARPU stabilization, and NBA cost normalization to all execute through H2 2026.
What Has to Go Right
- Free wireless line conversions must materialize at scale in H2: management expects the “significant majority” to convert to paid, with early cohort retention described as encouraging; convergence ARPA sits at roughly $85 vs. roughly $170 for telecom competitors, leaving significant expansion room
- Broadband ARPU must stabilize after Q2 as the company laps its 2025 pricing reset; the 117,000 year-over-year improvement in subscriber losses must prove structural rather than promotional
- Peacock must sustain the Q2 profitability inflection: 46 million paid subscribers and revenue up more than 70% place Comcast stock’s streaming asset at a credible threshold for durable profitability
- Parks must hold its growth trajectory with Epic Universe continuing to lift per-cap spending as international travel headwinds persist at Osaka and Beijing
What Could Still Go Wrong
- More than half of Q1’s broadband improvement tied to Legendary February marketing and offers, a one-time window that will not repeat at the same scale, leaving Q2 and Q3 organic trends exposed
- Broadband ARPU pressure is not projected to ease until H2, meaning two more quarters of convergence revenue headwinds remain baked into the near-term financials for Comcast stock
- The NBA contract runs on straight-line amortization and future seasons reset annual dilution: durable Peacock profitability requires distribution revenue from 46 million subscribers to grow fast enough to absorb that recurring cost
- Macro exposure across Parks and advertising remains a live risk: management noted on the Q1 2026 earnings call that inbound international travel to U.S. parks has not recovered to pre-COVID levels, and domestic Parks results have not yet shown consumer softness but could if elevated costs persist
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