Good morning, ladies and gentlemen, and welcome to Comcast's Fourth Quarter and Full Year 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. Please note that this conference call is being recorded. I would now turn the call over to Senior Vice President, Investor Relations and Finance Mr. Jason Armstrong. Please go ahead, Mr. Armstrong.

Thank you, operator, and welcome, everyone. Joining me on this morning's call are Brian Roberts, Mike Cavanagh, Steve Burke and Dave Watson. Brian and Mike will make formal remarks and Steve and Dave will also be available for Q&A. As always, let me now refer you to Slide number 2, which contains our Safe Harbor disclaimer and remind you this conference call may include forward-looking statements, subject to certain risks and uncertainties. In addition, in this call, we will refer to certain non-GAAP financial measures. Please refer to our 8-K for the reconciliation of non-GAAP financial measures to GAAP. With that, let me turn the call to Brian Roberts for his comments. Brian?

Thank you, Jason, and good morning, everyone. Across Comcast, NBCUniversal our company is executing at a high level and I'm proud to report fantastic results for both the fourth quarter and full year 2017. Starting with the fourth quarter Cable Communications, we continue to have strength in our connectivity businesses where we added 350,000 net new broadband customers and increased business services revenue by 12.2%, as well as continued improvements as results of our investments in the customer experience. At NBCUniversal we had a terrific quarter driven by robust affiliate fees and retrans growth, a successful holiday season at our Theme Parks capping off a great 2017 and record profitability at Filmed. Perhaps even better this exceptional performance in 2017 positions us well as we enter 2018. The recent passage of tax reform provides real and immediate benefits for our company that will further enhance our financial position and will in turn enable us to do more of the things that help us better serve our customers, our employees and the communities where we operate as well as drive value for our shareholders. This means continuing to develop the most innovative products and services, investing where we see high returns and opportunities to drive growth including in our broadband network, TV, Filmed and Theme Park offerings and continuing to deliver a healthy return of capital to shareholders. Based on this solid foundation and our confidence in our outlook today we're announcing a 21% increase in our dividend which is our 10th consecutive annual increase. We also expect to repurchase at least $5 billion in stock in 2018. With that let me talk about a few of our achievements this past year. Our company has an excellent track record of delivering strong, consistent results and this continued in 2017 with EBITDA…

Thanks, Brian and good morning, everybody. I'll begin by reviewing our consolidated results on Slides 4 and 5. Revenue increased 4.2% to $21.9 billion for the fourth quarter and increased 5.1% to $84.5 billion for the full year. Fourth quarter adjusted EBITDA of $6.8 billion was relatively flat compared to last year and for the full year EBITDA of $28.1 billion increased 6.2%. Results for the quarter reflect healthy EBITDA growth of 4.2% and 6.4% for Cable and NBCUniversal respectively. The corporate and other results include $171 million related to a special employee bonus following the passage of tax reform and negative $176 million of EBITDA from the launch of our wireless business. Adjusted earnings per share increased 8.9% to $0.49 for the quarter and 18.4%, $2.06 for the year. These results exclude $12.7 billion of net income tax benefits primarily associated with a change in our deferred income tax liability as a result of the 2017 tax reform legislation. Details of our EPS adjustments are provided in table four and our press release. And finally free cash flow was $2 billion in the quarter and $9.6 billion for the full year. Now let's turn to Cable Communications on Slide 6. Before going into the details of the quarter I'd like to provide a couple of highlights for the year in the Cable Communications business. Our full year cable revenue increased 4.9% and EBITDA increased 5.3% while we grew customer relationships by 770,000 to more than 29 million. These results were driven by our connectivity businesses including high speed data and business services which totaled more than $20 billion in revenue which grew over 10% in 2017. We were focused on striking the right balance between strong financial results and growth in our customer metrics and we believe our results…

Great. Thanks Mike. Thank you Mike. Regina, let's open up the call for Q&A please.

Brian, you talked a lot about connectivity in your prepared remarks and I think the market is very focused certainly on your runway in broadband. When you look at your three-year or longer term products roadmap for connectivity in broadband. What are the things that you're most excited about to keep that business growing and specifically I'm wondering consumers use to pay just for access to the internet but obviously the number of devices is growing, coverage is more important, you've added mobile what are things that you think keep that business taking share and what does [indiscernible] maturing business and then I just had a quick follow-up for Mike.

Well let me start and then I'd like to kick it over to Dave Watson. First of all, it's absolute penetration it is about 48%, let me correct that, 40% growth opportunity and but the absolute penetration where are in broadband start with that, as an industry and where are we with our competitors. And how good is our product. I feel really good about the roadmap for that. number two, we launched a mobile product for our broadband customers we're really excited about that. we talked about the speed and pods and the connectivity and coverage. Then you've got smart home, you look at CES. Everything at CES is all about what's going to happen to the home of the future in the next three years, five years, 10 years. It's hard to know exactly when any of those items will explode, you look at our bit per home consumption rate and that is up again even more this year. so that's why we like the business so much and ultimately you boil it all down to that. we love all those bits to be our bits, but that doesn't matter. We want to give customers an incredible experience. We want to be the best and that requires investment and innovation and that's really I think the pivot that the company has been making over several years and this year's results and the fourth quarter results I think demonstrate real strength in this business. Dave?

Well as Brian said I think there is the growth opportunities both in market share and rate. and if you look at the overall numbers of broadband, the overall broadband penetration being around 80% there is room just there. So home growth is solid in 2017, so home's past growing by 1.4%. the DSL base is still substantial so overall as you start there's room for growth. But what we're focused on is what's working. What's working is, this focus that Brian mentioned around innovation and we have a great scaled infrastructure, got 3.1 that's now at the end of the year at 80%. We'll complete that by the end of 2018, puts us in position to have very large scaled on gig rolled out. So as consumption and usage continues to climb, we're going to be ahead of the curve in terms of capacity. So and then the big three for us are speeds, we continue to increase speeds we've done that consistently the 16 times at the last 17 years and the new thing is, is coverage the combination of great devices best-in-class gateway devices that in off themselves provide great coverage, you marry that with the new pods the Wi-Fi extenders and so coverage I think is a great answer that will help us drive the business and then last is, being able to control all these things. So connect that modest rate increases, you're focusing on disciplined approach towards multi-product discounts making sure that the extent they just want broadband and [indiscernible], we'll be disciplined in that approach and so - and also, as consumption goes, we're going to be very focused on providing the best tier of broadband service for the customer. So there's opportunities and rate and growth.

That's helpful. And just Mike on your last point on leverage I think I heard you say 2.2 is sort of where you think the company should be. I think at $5 billion you would delever pretty decently in 2018, so are you suggesting then that sort of the upside of that number comes from managing towards 2.2 based on what other capital allocation opportunities come your way this year, is that sort of how we should interpret that comment?

Sure. You should think about the comments in context of our capital allocation framework which doesn't change. This team's priority to balance three things; one invest in the business to keep it growing and optimize earnings power [ph] over the long-term; two is keep a very strong balance sheet and three is to, do healthy returns of capital of the shareholders. So I think with the framework we've just described saying a minimum of five and anchoring that to around 2.2 times leverage everybody with their own forecast - what's going to happen that's how you would find there to be upside in the buyback during the course of this year. obviously depending on us executing the balance strategy I just described.

That's helpful. Thank you both.

Great, thanks Ben. Next question please.

Your next question comes from the line of Phil Cusick with JP Morgan. Please go ahead.

Brian, two quick ones if I can. Brian, can you talk about what the bar might look like for US and International M&A and given a lot of deals in the front of DOJ today. Do you want to see some better direction before getting involved? And then in wireless you mentioned the potential for acceleration in 2018. Are you now confident that the business is attractive and you have the right model and now is really the time to let it start to spin up? Thank you.

Let me kick over to Dave to start on the wireless question first.

In mobile while it's early Phil that we're really pleased with the early stage results. we launched in May. As Mike said early, we achieved 380,000 lines so there is solid momentum as we approach. We like our game plan we like the fact that's connected to our existing business lines and it's a really simple product approach that can scale and so strong digital focus experience. What we're finding is, that By the Gig approach is very attractive to most of the customers are taking out, we still sell on limited but it's - I think in very unique position as we scale this to do both. So it's early still and just brandings kicking in and we're expanding distribution to our existing retail locations and we're going to begin to package it with our other lines of business including broadband so it gives us just real packaging optionality, so I think we're well positioned going into 2018 as we scale mobile.

Let me just reiterate as I said earlier. We always are looking for ways to create more value for shareholders from opportunities as Mike just described where we find capital to invest in the business or new businesses like Dave just talked about in wireless or what we're doing with the Olympics. At the same time, you look at in organic opportunities that come along and you have a bar. I think I say that there is nothing we feel we have to acquire and I think that's an important point to emphasize. So I think we set it high I don't know how to articulate that except to look to our track record and we've created value for shareholders for I think in almost every instance and that's certainly the goal when we do so. So our most recent example would be the Japan theme park and stay tuned, we'll see if we can execute but so far we feel terrific about that and obviously NBCUniversal as I mentioned before is the biggest example. So we don't talk about specific situations and I hope that helps to clarify.

Thanks Brian.

Thank you Phil. Next question please.

Your next question comes from the line of John Hodulik with UBS. Please go ahead.

Maybe one for Mike and one for Dave. First Mike some good data on the effective tax reform. Can you give us a better sense of sort of the dollar savings that you expect from if you're looking from 2017 to 2018 just to get a better sense of how much growth we're going to see off that $9.6 billion in free cash flow? And then for Dave on the video business, definitely some solid numbers from a subscriber standpoint. Can you give us a sense of what you're saying in terms of pressure from sort of live streaming providers? Does that change since we went from quarter-to-quarter? and then maybe an outlook on what you expect from a programming cost growth number for next year? thanks.

John, it's Mike. So I'll tell you how to think about the impact, but everybody has again got the wrong forecast rather than fixing numbers for you. What I said is about 11 points decline in the gap tax rate which will also improve cash taxes by the same magnitude, so use your own estimate of what our pre-tax income is next year and you'll get that. but then obviously on top of that, we get to immediately expense the eligible amount of $10 billion capital or so we're putting in and so you can take swag at that. It's meaningful obviously but those are the two key pieces that drive it.

The CapEx you expect, vast majority to be expensable [ph]?

Yes.

All right. Thanks.

So John on the video side, it is definitely very competitive video environment then we really don't expect to level a competition to diminish. However, we're going to continue to aggressively compete for profitable video relationships and our approach what is working and we made some a very moderate adjustments as how we compete that, I think have helped us in Q4 but we're going to continue to segment the marketplace and we've introduced new services like Instant TV, which is our streaming cable network delivered product without a set top box, going to use that on a targeted basis. Our focus is going to be bundling, full bundles leveraging best-in-class X1 and broadband, that packaging it is working and so we feel good about Q4, it is competitive and so we're going to stay at it. But the thing that I think is important to note, that we've seen this adjustment coming in terms of this marketplace. The intensity over the top new entrants and based on that while we're going to compete aggressively across the board for good video customers. We have transitioned more and more towards broadband and so broadband is a centerpiece for us. We're going to have good balance on profitable growth, leveraging broadband. We expect to compete aggressively in video and leverage some of the new things we're doing, but we just don't see the environment shifting too much from what we saw at the end of last year.

All right, thanks guys.

To last point on programming cost. I think as Mike said it was to expect moderate decrease and so I think some of the timing of the relationships are focused around this is margin and we stay extremely focused on overall margin programming is one piece of it but because you know we're very focused on the experience taking transactions out and you look at things like to the extent that we're adding which we are, customer relationships and the fact that we've taken out just lots and lots of transactions out, that's as importance as anything, but programming cost we do expect to moderately decrease.

And obviously it's Mike to chime in there. That translates into the as much as 50 basis points improvement in margins for cable for 2018.

Great, thanks guys.

Next question please.

Your next question comes from the line of Jessica Reif Cohen with Bank of America Merrill Lynch. Please go ahead.

I almost don't know where to start but I guess first sort of combined Cable NBCU question. At CES few weeks ago, Comcast Cable and NBCU seemed to be front and center of the industry for addressable advertising both in terms of the platform and the services you're offering. And Marcien Jenckes, Linda Yaccarino were right there. And seem to be an industry leading position. So can you just talk a little bit about where do you think the industry and company is within that in terms of regaining dollars lost from traditional media to the newer platforms. Can you just give us any color on what you're doing or what you're expecting? And then for NBCU specifically, can you talk a little bit Steve. I know you're on about the integration of DreamWorks animation and does that help you in your efforts and consumer products. And if I can just throw in one for Brian as a follow-up to the M&A topic. There seems to be some really clear opportunities in both media and distribution amid an obvious restructuring or coming restructuring of the industry. But there are also so many different forces playing out right now with the same companies are investing so heavily in premium video in ways we've never seen yet you have this unpredictability in Washington and what can get approved and not approved. So can you just give us color on how you're thinking of getting, are you getting pushed in one direction or another in terms of media content or distribution?

So I'll answer two of your four or five questions and then pass to Dave or Brian, but and let me start with DreamWorks. We bought DreamWorks 18 months or so ago and have completely retooled the flow of releases. We actually have a slow year this year and then next year in 2019 we'll have couple releases and then should have two releases every year thereafter and if you combine that with a couple of releases from Illumination, we should have four animated films and good full throttle a year. we're very happy with the progress we've made at DreamWorks and you can imagine a year when we have four great animated films what that will do to our films OCF. At the same time, we very much believe that we need to have the ecosystem of new IP, strong consumer products and then appearance in our theme parks and we've got that cranked up now. We've made a lot of investments and seen a lot of growth in consumer products in the last couple of years, those results are embedded in the record year that our filmed group that and you're going to see that continue in the future. The ultimate pay off being when you've created enough IP to really leverage that consumer products capability, that capability is worldwide. We're opening offices overseas, taking back agent relationships, with employee relationships. I think consumer products is a big upside for NBCUniversal. In terms of the advertising, it's impossible not to see the strength particularly of Facebook and Google really the dominance of Facebook and Google in terms of digital advertising and a lot of the growth in ecosystem is going toward digital and we're not participating in that growth to the degree that we should be given the…

And Jessica, Dave. As Steve said one of the things on the cable side that we're focused on. Is being able to pull together the platform that could pull together all the content and our first wave that Marcien is helping us stay very focused on is VoD. So the VoD addressability is up and running having success with that. but really our - the transition continues to stay focused on VoD linear online all coming together. I think cable and distribution we have a unique opportunity to pull all these things together. So Marcien has done a nice job pulling together the platform elements that put us in position to make these things happen.

Just to the other question. I think probably we covered it a little bit in theory in my prior conversation and I think it's an interesting time and the business opportunities are being created, some of those opportunities are negative and some are positive. I think our jobs are to study and understand where to grow. And I think Dave acknowledging that we saw changes in video coming as for instance and put our innovation efforts around broadband it's just - but an example that I think the emphasis on theme parks which we didn't anticipate when we bought NBCUniversal but we saw opportunities there as for instance. So let's leave it that for now, it's kind of the thing we'll talk about overtime some of your prediction of restructuring of the industry let's see if that all plays out that way and there will be more information in the quarters ahead.

Okay, thank you.

Thanks, Jessica. Next question please.

Your next question comes from the line of Marci Ryvicker with Wells Fargo. Please go ahead.

I've two questions for Mike and then one for Steve. So first Mike, it's sounds like XFINITY Mobile is staying in corporate. I guess at what point you put this in Cable Communications, do you wait until this is profitable? And then secondly it sounds like the programming costs are driving, the majority of the 50 basis point improvement in cable margins, so are we interpreting that correctly. And then for Steve you have a very unique portfolio coming into the year in terms of advertising [indiscernible] Super Bowl and the Olympics. But do you have any sense what advertisers are going to do with their excess cash from tax reform on their own balance sheet? So are you hearing that anymore advertising dollars might come into the system and go towards [indiscernible].

Thanks, Marci. So it's Mike. The XFINITY Mobile expected to stay in corporate for all of 2018 probably if I had to guess all 2019 [ph]. The idea here is to obviously share the information, we do share you'll see everything that matters, but not to have the - as we're ramping that business. It's obviously would otherwise distort core business in cable. So we'll talk about and share it with you, but I think putting it where we put it is intended to be transparent and clear, so you can judge the business from a bunch of different angles, so couple of years would be my answer on that. And then on margin improvement I'm going to make sure you get the number right. As much as 50 basis points I might have heard you say 15. It's really the sum of two things, it is obviously the easing of programming cost increases which we had two big years looking back to the years before this. Dave and team they have done a great job managing all parts of the cost base away from programming and that's continued. So I would give credit over a multi-year period say that it's the focus on being efficient in all categories that's contributing to this year's margin changes not just programming.

So in terms of advertising, we're 10 days away from the Super Bowl and as we head into the Super Bowl, we're averaging about $5 million a unit which is up call it 15% or 20% we think from last year and we're essentially sold out. So if you're looking for sort of an immediate sign as to how hot the market is, as far as the Super Bowl goes, it's pretty hot. I think television advertising ecosystem has been strong for a while now probably two or three years or strength. It feels like it might be getting a little stronger now. I don't think there is necessarily a direct correlation from the tax cuts and having more cash and throwing that into advertising I think it might be more related to just overall business sentiment, but to the degree that business sentiment is slightly stronger now than it was six months ago or stronger now than it was six months ago. I think you can kind of feel that coming into the advertising market and as we look forward into the upfront, which is only a few months away by all accounts it's going to be a strong upfront.

The only other thing I would add, another theory would be that because the Eagles are in the Super Bowl [indiscernible] strong, but I'm not sure.

Great. Thank you.

Thank you, Marci. Next question please.

Your next question comes from the line of Vijay Jayant with Evercore. Please go ahead.

I just wanted to - for Steve. The virtual MVPD growth over the last year and you know the impact on the underlying subscriber trends and the affiliate numbers and retransmission number looks pretty good at NBCU's broadcasting cable. So any color on how the underlying subscriber trends are there and then just a broad question on net neutrality and the reversal of the Title II, is there anything different that's going to be done now given that's probably not an overhang anymore on the broadband side of the business. Thank you.

So I think when you're think about virtual MVPDs or MVPD changes in general from an NBCUniversal perspective we're really talking about tenths of a percentage point, you were not talking about major, major changes and the virtual MVPDs are accelerating as more of them getting into the business and their business grow, some of them are accelerating, but it's a relatively minor effect across the board for NBCUniversal and if you look at the last two or three quarters you'll see changes in the tenths of a percentage point but not percentage changes overall. I think we've said that we've supported free and Open Internet and we have been committed to enforceable Open Internet protection. We just thought Title II was unnecessary to guarantee consumers that Open Internet. So it's - we believe Congress will hopefully now have to put some enduring set of enforceable Open Internet protection that can no longer get revisited and reversed with different administration. So I do think it gave us the confident to make the statement that over the next five years we're going to have significant investment in our economy to the tuneable at least $50 billion. So we're moving forward investing and innovating and I think we look forward to someday putting this conversation behind us for everybody's sake.

Thanks so much.

Thank you Vijay. Next question please.

Your next question comes from the line of Jason Bazinet with Citi. Please go ahead.

I just had a question for Mr. Burke. I guess if you guys do M&A, I hope everyone remember how almost universally negative they were on the NBCU acquisition when you did it because when I look at my numbers back in 2010 it was about 20% of your EBITDA and NBCU was made up almost 50% of the EBITDA dollar change for the last seven years. I think we all understand you've done a great job on a number of fronts. Park Studio, Telemundo, retrans. My question is, what leverage do you see left? In other words are there still big leverage that you see over the next two or three years or do you think NBCU's growth will begin to more closely resemble sort of industry's growth. Thank you.

Well I think we still have a lot of opportunity and it's very, very hard to predict. When we bought the company seven years ago. I think the operating cash flow was about $3.5 billion and in this past year was about $8.2 billion and we never dreamt seven or eight years ago that we would get that kind of growth. We saw opportunities but we weren't articulated about the degree of that opportunity and it's equally difficult as you look into the future. But I think we have a lot of opportunity still, if you look at MSNBC beating CNN almost every night and beating Fox many nights. Fox news and the fact that MSNBC makes a fraction of what CNN and Fox news make. If you look at Telemundo beating Univision last year in primetime and Univision making a lot more money than Telemundo, if you look at our theme parks which are fantastic and every time we open new attractions we're seeing very, very substantial jumps in attendances and we have room for thousands more hotel rooms. If you look really across the board I think we still have a lot of opportunity. The fact of the matter is, NBC primetime is going from fourth to first and you can't be any better than first and Universal Pictures has had two out of three biggest years in its history in the last three years. So trees don't grow to the sky, but we still have a lot of opportunities. I think we have a great management team. We're allocating capital in a very rational way, we've a great culture. Everybody works together with symphony. So I'm optimistic we can continue to grow and we still have lots and lots of opportunities.

Thank you Jason. Regina, we'll make this the last question please.

Our final question will come from the line of Brett Feldman with Goldman Sachs. Please go ahead.

Thanks for taking the question. And just a follow-up a little bit more on XFINITY Mobile. Mike mentioned that the EBITDA losses here I think we're a little greater than you had initially thought and there is going to be some incremental drag in 2018, it sounds like from his comments that the key variable there is just higher customer growth and therefore higher customer acquisition cost and I just want to confirm that's the right way of understanding that. and then you got to over 380,000 subs with pretty narrowing targeted distribution. I was hoping maybe if you could just expand upon what your plans are for this year particularly on the distribution standpoint in order to make sure you're able to keep that momentum going. Thanks.

Brett, it's Mike. [indiscernible] hand it over to Dave. So on this year's drag I'd say it's in line with what we had expected maybe a touch higher, but not meaningfully so and yes, what happens next year will very much be a function of the hope for ramping up subscriber acquisitions which obviously until we get to a level of sort of stability at a higher level than this, you'll be having increasing drag but that's a good thing as we're growing the business so we think it's going to be very valuable to the overall economics of the customer relationship.

So from a distribution standpoint, one of the things we talked about early on, was our focus around digital. And having a great digital experience and through the sales process, through on boarding and so that's working. We're real pleased with digital as a channel. I mentioned retail, our existing retail locations don't feel we need to go a lot bigger, we have a long-term good plan, but we're introducing mobile into existing retail and we're having success there. It's early but I think a [indiscernible] scaled operations around retail experience and the last but not least, there's the introducing it, which we've done into our traditional inbound call centers which always do a good job with products. So I think you piece all these things together there is upside and opportunity as we expand distribution in mobile.

Thanks one quick question. I know you're targeting your existing base with this product. Are you finding that when you bring new customer relationships on, you're able to attach mobile at the box?

As you just maybe heard, we just announced Bring Your Own Device nice new addition, so too early to give too much color on that, but it's a real opportunity both for existing customers and new customers being able to come in, bring their device and talk about transitioning over so, we're focused on balanced approach to existing customers but also more and more be reaching out to new customers and we'll talk about then the other lines of business in addition to not just mobile.

All right. Thanks for taking the question.

Thank you all.

Okay, thank you everyone for joining us this morning. We'll end the call. Regina back to you.

There will be a replay available of today's call starting at 12 o' clock PM Eastern time. It will run through Thursday, January 31st at midnight Eastern Time. The dial-in number is 855-859-2056 and the conference ID number is 469-5509. A recording of the conference call will also be available on the company's website beginning at 12:30 PM Eastern Time today. This concludes today's teleconference. Thank you for participating. You may all disconnect.