Report Overview

Sky UK Q1 2019 results: weak ARPU hits bottom line

Sky made a surprisingly weak start to 2019, with revenue growth decelerating to 1.9% (the first time below 4% since the European businesses merged in 2015), due to weaker ARPU trends

However, Sky expects improvement to follow, blaming one-off factors in the quarter. The ARPU weakness drove EBITDA down 11.3%, but this should bounce back across the rest of 2019 as football rights costs turn from a drag to a positive

Comcast highlighted collaborations with Sky across tech, advertising, content distribution and even news, stating it is on track to achieve the anticipated $500 million in annual synergies over the next couple of years

Contents

Headline financials: slowdown in revenue growth impacts profits

• DTC subscriptions rise, but at the expense of ARPU
• Content and advertising revenues

Facing the streaming challenge

Sky’s contribution to Comcast

List of charts/tables

Figure 1. Headline financials ($m) and YOY constant currency growth rates

Figure 2. Sky retail customer net adds (000)

Figure 3. Sky direct-to-consumer revenue growth at constant currency

Figure 4. UK homes subscribing to Sky TV (m)