Edgar Filing: COMCAST CORP

Form 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x	Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2009

¨	Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Transition Period from to

Commission File Number 001-32871

LOGO

COMCAST CORPORATION

(Exact name of registrant as specified in its charter)


PENNSYLVANIA		27-0000798
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

One Comcast Center, Philadelphia, PA		19103-2838
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (215) 286-1700

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such period that the registrant was required to submit and post such files).

Yes x No ¨

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ¨

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act).

Yes ¨ No x

As of June 30, 2009, there were 2,061,081,040 shares of our Class A common stock, 799,269,146 shares of our Class A Special common stock and 9,444,375 shares of our Class B common stock outstanding.

TABLE OF CONTENTS


		Page Number
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements	2
	Condensed Consolidated Balance Sheet as of June 30, 2009 and December 31, 2008 (Unaudited)	2
	Condensed Consolidated Statement of Operations for the Three and Six Months Ended June 30, 2009 and 2008 (Unaudited)	3
	Condensed Consolidated Statement of Cash Flows for the Six Months Ended June 30, 2009 and 2008 (Unaudited)	4
	Condensed Consolidated Statement of Changes in Equity for the Six Months Ended June 30, 2009 and June 30, 2008 (Unaudited)	5
	Condensed Consolidated Statement of Comprehensive Income for the Three and Six Months Ended June 30, 2009 and 2008 (Unaudited)	6
	Notes to Condensed Consolidated Financial Statements (Unaudited)	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4.	Controls and Procedures	32
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
Item 4.	Submission of Matters to a Vote of Security Holders	33
Item 5.	Other Information	34
Item 6.	Exhibits	35
SIGNATURES		36

This Quarterly Report on Form 10-Q is for the three and six months ended June 30, 2009. This Quarterly Report modifies and supersedes documents filed prior to this Quarterly Report. The Securities and Exchange Commission (“SEC”) allows us to “incorporate by reference” information that we file with it, which means that we can disclose important information to you by referring you directly to those documents. Information incorporated by reference is considered to be part of this Quarterly Report. In addition, information that we file with the SEC in the future will automatically update and supersede information contained in this Quarterly Report. Throughout this Quarterly Report, we refer to Comcast Corporation as “Comcast;” Comcast and its consolidated subsidiaries as “we,” “us” and “our;” and Comcast Holdings Corporation as “Comcast Holdings.”

You should carefully review the information contained in this Quarterly Report and particularly consider any risk factors that we set forth in this Quarterly Report and in other reports or documents that we file from time to time with the SEC. In this Quarterly Report, we state our beliefs of future events and of our future financial performance. In some cases, you can identify these so-called “forward-looking statements” by words such as “may,” “will,” “should,” “expects,” “believes,” “estimates,” “potential,” or “continue,” or the negative of those words, and other comparable words. You should be aware that those statements are only our predictions. In evaluating those statements, you should specifically consider various factors, including the risks outlined below and in other reports we file with the SEC. Actual events or our actual results may differ materially from any of our forward-looking statements. We undertake no obligation to update any forward-looking statements.

Our businesses may be affected by, among other things, the following:

•

all of the services offered by our cable systems face a wide range of competition that could adversely affect our future results of operations

•

we may face increased competition because of technological advances and new regulatory requirements, which could adversely affect our future results of operations

•

programming expenses are increasing, which could adversely affect our future results of operations

•

we are subject to regulation by federal, state and local governments, which may impose additional costs and restrictions

•

weakening economic conditions may have a negative impact on our results of operations and financial condition

•

we rely on network and information systems and other technology, and a disruption or failure of such networks, systems or technology may disrupt our business

•

we may be unable to obtain necessary hardware, software and operational support

•

our business depends on certain intellectual property rights and on not infringing the intellectual property rights of others

•

we face risks arising from the outcome of various litigation matters

•

acquisitions and other strategic transactions present many risks, and we may not realize the financial and strategic goals that were contemplated at the time of any transaction

•

our Class B common stock has substantial voting rights and separate approval rights over several potentially material transactions, and our Chairman and CEO has considerable influence over our operations through his beneficial ownership of our Class B common stock

PART I: FINANCIAL INFORMATION

ITEM 1: FINANCIAL STATEMENTS

Condensed Consolidated Balance Sheet

(Unaudited)


(in millions, except share data)	June 30, 2009			December 31, 2008
ASSETS
Current Assets:
Cash and cash equivalents	$	3,989		$	1,195
Investments		62			59
Accounts receivable, less allowance for doubtful accounts of $192 and $190		1,677			1,626
Other current assets		809			836
Total current assets		6,537			3,716
Investments		5,190			4,783
Property and equipment, net of accumulated depreciation of $25,544 and $23,235		23,715			24,444
Franchise rights		59,446			59,449
Goodwill		14,928			14,889
Other intangible assets, net of accumulated amortization of $8,299 and $8,160		4,297			4,558
Other noncurrent assets, net		1,124			1,178
Total assets	$	115,237		$	113,017

LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable and accrued expenses related to trade creditors	$	3,070		$	3,393
Accrued expenses and other current liabilities		3,320			3,268
Current portion of long-term debt		4,167			2,278
Total current liabilities		10,557			8,939
Long-term debt, less current portion		28,870			30,178
Deferred income taxes		27,394			26,982
Other noncurrent liabilities		6,435			6,171
Commitments and Contingencies (Note 10)
Redeemable noncontrolling interests		167			171
Equity:
Preferred stock—authorized, 20,000,000 shares; issued, zero		—			—
Class A common stock, $0.01 par value—authorized, 7,500,000,000 shares; issued, 2,426,541,790 and 2,426,443,484; outstanding, 2,061,081,040 and 2,060,982,734		24			24
Class A Special common stock, $0.01 par value—authorized, 7,500,000,000 shares; issued, 870,203,910 and 881,145,954; outstanding 799,269,146 and 810,211,190		9			9
Class B common stock, $0.01 par value—authorized, 75,000,000 shares; issued and outstanding, 9,444,375		—			—
Additional paid-in capital		40,561			40,620
Retained earnings		8,736			7,427
Treasury stock—365,460,750 Class A common shares and 70,934,764 Class A Special common shares		(7,517	)		(7,517	)
Accumulated other comprehensive income (loss)		(80	)		(113	)
Total Comcast Corporation stockholders’ equity		41,733			40,450
Noncontrolling interests		81			126
Total equity		41,814			40,576
Total liabilities and equity	$	115,237		$	113,017

See notes to condensed consolidated financial statements.

Condensed Consolidated Statement of Operations

(Unaudited)


	Three Months Ended June 30						Six Months Ended June 30
(in millions, except per share data)	2009			2008			2009			2008
Revenue	$	8,938		$	8,553		$	17,773		$	16,942
Costs and Expenses:
Operating (excluding depreciation and amortization)		3,545			3,334			7,110			6,695
Selling, general and administrative		1,858			1,868			3,684			3,722
Depreciation		1,406			1,371			2,786			2,761
Amortization		254			230			507			459
		7,063			6,803			14,087			13,637
Operating income		1,875			1,750			3,686			3,305
Other Income (Expense):
Interest expense		(551	)		(618	)		(1,121	)		(1,239	)
Investment income (loss), net		57			(70	)		70			9
Equity in net income (losses) of affiliates, net		(13	)		(4	)		(27	)		(39	)
Other income (expense)		12			16			11			284
		(495	)		(676	)		(1,067	)		(985	)
Income before income taxes		1,380			1,074			2,619			2,320
Income tax expense		(424	)		(455	)		(885	)		(963	)
Net income from consolidated operations		956			619			1,734			1,357
Net (income) loss attributable to noncontrolling interests		11			13			5			7

Net income attributable to Comcast Corporation	$	967		$	632		$	1,739		$	1,364

Basic earnings per common share attributable to Comcast Corporation stockholders	$	0.33		$	0.21		$	0.60		$	0.46
Diluted earnings per common share attributable to Comcast Corporation stockholders	$	0.33		$	0.21		$	0.60		$	0.46
Dividends declared per common share attributable to Comcast Corporation stockholders	$	0.07		$	0.06		$	0.14		$	0.13

See notes to condensed consolidated financial statements.

Condensed Consolidated Statement of Cash Flows

(Unaudited)


	Six Months Ended June 30
(in millions)	2009			2008
Net cash provided by operating activities	$	5,113		$	4,928
Financing Activities
Proceeds from borrowings		2,522			2,009
Repurchases and repayments of debt		(1,767	)		(831	)
Repurchases of common stock		(108	)		(1,979	)
Dividends paid		(375	)		(185	)
Issuances of common stock		1			42
Other		(22	)		(135	)
Net cash provided by (used in) financing activities		251			(1,079	)
Investing Activities
Capital expenditures		(2,281	)		(2,731	)
Cash paid for intangible assets		(241	)		(245	)
Acquisitions, net of cash acquired		(27	)		(331	)
Proceeds from sales of investments		16			320
Purchases of investments		(67	)		(41	)
Other		30			(17	)
Net cash provided by (used in) investing activities		(2,570	)		(3,045	)
Increase (decrease) in cash and cash equivalents		2,794			804
Cash and cash equivalents, beginning of period		1,195			963
Cash and cash equivalents, end of period	$	3,989		$	1,767

See notes to condensed consolidated financial statements.

Condensed Consolidated Statement of Changes in Equity (Unaudited)


				Comcast Corporation Stockholders’ Equity
				Common Stock
(in millions)	Redeemable Noncontrolling Interests			A		A Special			B		Additional Paid-In Capital			Retained Earnings			Treasury Stock at Cost			Accumulated Other Comprehensive Income (Loss)			Noncontrolling Interests			Total Equity
Balance, December 31, 2007	$	101		$	24	$	10		$	—	$	41,688		$	7,191		$	(7,517	)	$	(56	)	$	149		$	41,489
Cumulative effect related to change in accounting principle on January 1, 2008															(132	)											(132	)
Stock compensation plans												148			(47	)											101
Repurchase and retirement of common stock							(1	)				(1,123	)		(877	)											(2,001	)
Employee stock purchase plan												35															35
Share exchange												165			(165	)											—
Dividends declared															(367	)											(367	)
Other comprehensive income (loss)																					(3	)					(3	)
Sale (purchase) of subsidiary shares to (from) noncontrolling interests, net		111
Contributions from and (distributions to) noncontrolling interests		(2	)																					(4	)		(4	)
Net income (loss)		(11	)												1,364									4			1,368
Balance, June 30, 2008	$	199		$	24	$	9		$	–	$	40,913		$	6,967		$	(7,517	)	$	(59	)	$	149		$	40,486
Balance, December 31, 2008	$	171		$	24	$	9		$	–	$	40,620		$	7,427		$	(7,517	)	$	(113	)	$	126		$	40,576
Stock compensation plans												51			1												52
Repurchase and retirement of common stock												(173	)		(42	)											(215	)
Employee stock purchase plan												33															33
Dividends declared															(389	)											(389	)
Other comprehensive income (loss)																					33						33
Purchases of subsidiary shares from noncontrolling interests												30												(35	)		(5	)
Contributions from and (distributions to) noncontrolling interests		3																						(12	)		(12	)
Net income (loss)		(7	)												1,739									2			1,741
Balance, June 30, 2009	$	167		$	24	$	9		$	–	$	40,561		$	8,736		$	(7,517	)	$	(80	)	$	81		$	41,814

See notes to condensed consolidated financial statements.

Condensed Consolidated Statement of Comprehensive Income (Unaudited)


	Three Months Ended June 30						Six Months Ended June 30
(in millions)	2009			2008			2009		2008
Net income from consolidated operations		$	956	$	619		$	1,734	$	1,357
Holding gains (losses) during the period, net of deferred taxes of $(2), $3, $(1) and $6			5		(5	)		4		(10	)
Reclassification adjustments for losses (gains) included in net income attributable to Comcast Corporation, net of deferred taxes of $(2), $(1), $(14) and $(3)			3		2			25		6
Employee benefit obligations, net of deferred taxes			—		—			—		(1	)
Cumulative translation adjustments			5		1			4		2
Comprehensive income			969		617			1,767		1,354
Net (income) loss attributable to noncontrolling interests			11		13			5		7
Comprehensive income attributable to Comcast Corporation		$	980	$	630		$	1,772	$	1,361

See notes to condensed consolidated financial statements.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 1: Condensed Consolidated Financial Statements

Basis of Presentation

We have prepared these unaudited condensed consolidated financial statements based on Securities and Exchange Commission (“SEC”) rules that permit reduced disclosure for interim periods. These financial statements include all adjustments that are necessary for a fair presentation of our results of operations and financial condition for the periods shown, including normal, recurring accruals and other items. We also evaluate events or transactions that occur after the balance sheet date but before the financial statements are issued (“subsequent events”) to determine if financial statement recognition or additional disclosure is required. The results of operations for the interim periods presented are not necessarily indicative of results for the full year.

The year-end condensed balance sheet was derived from audited financial statements but does not include all disclosures required by generally accepted accounting principles in the United States (“GAAP”). For a more complete discussion of our accounting policies and certain other information, refer to our annual financial statements for the preceding fiscal year as filed with the SEC.

Reclassifications have been made to the prior year’s consolidated financial statements between operating expenses and selling, general and administrative expenses to conform to classifications used in 2009.

Note 2: Recent Accounting Pronouncements

Noncontrolling Interests in Consolidated Financial Statements

In November 2007, the Financial Accounting Standards Board (“FASB”) issued a new accounting standard that provides guidance on the accounting and reporting requirements for noncontrolling interests in consolidated financial statements. The guidance requires noncontrolling interests (previously referred to as minority interests) that are not redeemable to be separately reported in the equity section of an entity’s consolidated balance sheet. Redeemable noncontrolling interests continue to be presented outside of equity. The guidance establishes accounting and reporting standards for (i) ownership interests in subsidiaries held by parties other than the parent, (ii) the amount of consolidated net income attributable to the parent and to the noncontrolling interests, (iii) changes in a parent’s ownership interest and (iv) the valuation of retained noncontrolling equity investments when a subsidiary is deconsolidated. In addition, it establishes disclosure requirements, including new financial statement captions that clearly distinguish between controlling and noncontrolling interests. These include a separate presentation of net income attributable to controlling and noncontrolling interests with the combined amounts labeled as “Net income from consolidated operations” in our statement of operations. Under the guidance, “Net income from consolidated operations” is comparable to what was previously presented as “Income from continuing operations before minority interest” and “Net income attributable to Comcast Corporation” is comparable to what was previously presented as “Net income.” We adopted the standard on January 1, 2009, at which time we applied the new presentation and disclosure requirements.

The new accounting standard requires the retrospective application of the new financial statement captions. The tables below reflect the revised presentations for our balance sheets as of December 31, 2008 and 2007 and consolidated statements of operations for the years ended December 31, 2008, 2007 and 2006.

Revised Balance Sheet Captions


December 31 (in millions)	2008		2007
Redeemable noncontrolling interests	$	171	$	101
Noncontrolling interests (in equity)	$	126	$	149

Revised Statement of Operations Captions


Year Ended December 31 (in millions, except per share data)	2008		2007		2006
Net income from consolidated operations	$	2,525	$	2,549	$	2,545
Net (income) loss attributable to noncontrolling interests		22		38		(12	)
Net income attributable to Comcast Corporation	$	2,547	$	2,587	$	2,533

Basic earnings per common share attributable to Comcast Corporation stockholders	$	0.87	$	0.84	$	0.80
Diluted earnings per common share attributable to Comcast Corporation stockholders	$	0.86	$	0.83	$	0.79

See Note 7 for further details on our noncontrolling interests.

Consolidation of Variable Interest Entities

In June 2009, the FASB amended the accounting guidance related to the consolidation of variable interest entities. The amended guidance (i) requires ongoing reassessments of whether an enterprise is the primary beneficiary of a variable interest entity, (ii) eliminates the quantitative approach previously required for determining the primary beneficiary of a variable interest entity and replaces it with a qualitative approach and (iii) requires additional disclosure about an enterprise’s involvement in variable interest entities. The new standard will be effective for us as of January 1, 2010. We are currently assessing the impact this standard will have on our consolidated financial statements.

Subsequent Events

In May 2009, the FASB issued a new accounting standard on the accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued (“subsequent events”). The standard requires disclosure of the date through which an entity has evaluated subsequent events and whether that date represents the date the financial statements were issued or were available to be issued. This disclosure is intended to alert all users of the financial statements that an entity has not evaluated subsequent events after that date in the set of financial statements being presented. The standard is effective for us as of June 30, 2009. Accordingly, we have evaluated subsequent events through the issuance of these financial statements on August 6, 2009. The adoption of this standard did not have a material impact on our consolidated financial statements.

Note 3: Earnings Per Share

Basic earnings per common share attributable to Comcast Corporation stockholders (“Basic EPS”) is computed by dividing net income attributable to Comcast Corporation by the weighted-average number of common shares outstanding during the period.

Our potentially dilutive securities include potential common shares related to our stock options and our restricted share units (“RSUs”). Diluted earnings per common share attributable to Comcast Corporation stockholders (“Diluted EPS”) considers the impact of potentially dilutive securities using the treasury stock method, except in periods in which there is a loss, because the inclusion of the potential common shares would have an antidilutive effect.

Diluted EPS for the three and six months ended June 30, 2009 excluded approximately 204 million and 196 million, respectively, of potential common shares related to our share-based compensation plans, because their inclusion would have had an antidilutive effect. For the three and six months ended June 30, 2008, Diluted EPS excluded approximately 146 million and 165 million potential common shares, respectively.

Computation of Diluted EPS


	Three Months Ended June 30
	2009					2008
(in millions, except per share data)	Net Income Attributable to Comcast Corporation		Shares	Per Share Amount		Net Income Attributable to Comcast Corporation		Shares	Per Share Amount
Basic EPS attributable to Comcast Corporation stockholders	$	967	2,887	$	0.33	$	632	2,957	$	0.21
Effect of dilutive securities:
Assumed exercise or issuance of shares related to stock plans			4					13
Diluted EPS attributable to Comcast Corporation stockholders	$	967	2,891	$	0.33	$	632	2,970	$	0.21


	Six Months Ended June 30
	2009					2008
(in millions, except per share data)	Net Income Attributable to Comcast Corporation		Shares	Per Share Amount		Net Income Attributable to Comcast Corporation		Shares	Per Share Amount
Basic EPS attributable to Comcast Corporation stockholders	$	1,739	2,886	$	0.60	$	1,364	2,983	$	0.46
Effect of dilutive securities:
Assumed exercise or issuance of shares related to stock plans			7					12
Diluted EPS attributable to Comcast Corporation stockholders	$	1,739	2,893	$	0.60	$	1,364	2,995	$	0.46

Note 4: Investments


(in millions)	June 30, 2009		December 31, 2008
Fair value method	$	1,328	$	943
Equity method, primarily SpectrumCo and Clearwire		2,205		2,177
Cost method, primarily AirTouch redeemable preferred shares		1,719		1,722
Total investments		5,252		4,842
Less: Current investments		62		59
Noncurrent investments	$	5,190	$	4,783

As of June 30, 2009 and December 31, 2008, the estimated fair value of the AirTouch preferred stock was $1.469 billion and $1.357 billion, respectively.

Components of Investment Income (Loss), Net


	Three Months Ended June 30						Six Months Ended June 30
(in millions)	2009			2008			2009			2008
Gains on sales and exchanges of investments, net	$	1		$	2		$	4		$	13
Investment impairment losses		(3	)		—			(19	)		(2	)
Unrealized gains (losses) on securities underlying prepaid forward sale agreements		342			(26	)		380			(290	)
Mark to market adjustments on derivative component of prepaid forward sale agreements		(311	)		(21	)		(340	)		273
Mark to market adjustments on derivative component of ZONES		(5	)		(43	)		4			(22	)
Interest and dividend income		27			36			54			73
Other		6			(18	)		(13	)		(36	)
Investment income (loss), net	$	57		$	(70	)	$	70		$	9

Note 5: Long-Term Debt

Borrowings

In June 2009, we issued $700 million principal amount of 5.70% notes due 2019 and $800 million principal amount of 6.55% notes due 2039. In June 2009, we issued $1.0 billion face amount of commercial paper. The net proceeds of these issuances, together with cash on hand, will be used for the purchase of notes included in the cash tender offer, as described below, the repayment of outstanding borrowings under our revolving credit facility, the repayment of debt at its maturity, and for working capital and general corporate purposes.

Redemptions and Repayments

In June 2009, we repaid $600 million of the amount outstanding under our revolving credit facility due 2013 and repaid at the maturity $750 million principal amount of our 6.875% notes due 2009.

In June 2009, we initiated a cash tender offer to purchase up to $1.3 billion aggregate principal amount of certain of our outstanding notes. As of June 30, 2009, approximately $1.7 billion aggregate principal amount of these notes was tendered to us. We accepted tenders for approximately $1.3 billion principal amount of these notes consisting of approximately $621 million principal amount of our 8.375% notes due 2013, $367 million principal amount of our 7.125% notes due 2013 and $312 million principal amount of our 7.875% senior debentures due 2013. The tender offer settled in July 2009. As of June 30, 2009, $1.3 billion was reclassified from long-term debt to current portion of long-term debt in our condensed consolidated balance sheet.

Note 6: Derivative Financial Instruments and Fair Value Measurements

We use derivative financial instruments to manage our exposure to the risks associated with fluctuations in interest rates and equity prices. Our objective is to manage the financial and operational exposures arising from these risks by offsetting gains and losses on the underlying exposures with gains and losses on the derivatives used to economically hedge them. Our risk management control system is used to assist us in monitoring the hedging program, derivative positions and hedging strategies. Hedges that receive designated hedge accounting treatment are evaluated for effectiveness at the time they are designated, as well as throughout the hedging period. We do not engage in any speculative or leveraged derivative transactions. All derivative transactions must comply with a derivatives policy authorized by our Board of Directors.

We manage the credit risks associated with our derivative financial instruments through the evaluation and monitoring of the creditworthiness of the counterparties. Although we may be exposed to losses in the event of nonperformance by the counterparties, we do not expect such losses, if any, to be significant. The valuation adjustments we recorded against the derivative assets to reflect counterparty credit risk are not significant.

We periodically examine the instruments we use to hedge exposure to interest rate and equity price risks to ensure that the instruments are matched with underlying assets or liabilities, to reduce our risks related to changes in interest rates or equity prices and, through market value and sensitivity analysis, to maintain a high correlation to the risk inherent in the hedged item. For those instruments that do not meet the above conditions, and for those derivative instruments that are not designated as a hedge, changes in fair value are recognized on a current basis in earnings.

As of June 30, 2009, our derivatives designated as hedges include (i) the derivative component of our prepaid forward sale agreements, which are recorded to other noncurrent liabilities, and (ii) our interest rate swap agreements, which are recorded to other noncurrent assets or liabilities. Changes in the fair value of the derivative component of our prepaid forward sale agreements are recorded to investment income (loss). Changes in the fair value of the interest rate swap agreements are recorded to interest expense. These amounts are completely offset by changes in the fair value of the related debt because the swaps are deemed to be 100% effective. The difference between variable and fixed rates to be paid or received under the terms of the interest rate swap agreements is accrued as interest rates change and recognized as an adjustment to interest expense for the related debt.

As of June 30, 2009, our derivatives not designated as hedges include the derivative component of our ZONES debt, which are recorded to long-term debt.

As of June 30, 2009, our debt had an estimated fair value of $34.160 billion. The estimated fair value of our publicly traded debt is based on quoted market values for the debt. To estimate the fair value of debt for which there are no quoted market prices, we use interest rates available to us for debt with similar terms and remaining maturities.

Recurring Fair Value Measures


	Fair Value as of June 30, 2009										December 31, 2008
(in millions)	Level 1		Level 2			Level 3		Total			Total
Assets
Trading securities	$	1,312	$	—		$	—	$	1,312		$	932
Available-for-sale securities		14		—			—		14			10
Equity warrants		—		—			1		1			1
Interest rate swap agreements		—		146			—		146			291
	$	1,326	$	146		$	1	$	1,473		$	1,234

Liabilities
Derivative component of ZONES	$	—	$	19		$	—	$	19		$	23
Derivative component of prepaid forward sale agreements		—		(126	)		—		(126	)		(466	)
Interest rate swap agreements		—		7			—		7			1
	$	—	$	(100	)	$	—	$	(100	)	$	(442	)

Amount of Gain (Loss) Recognized in Income on Derivative Instruments


(in millions)	Three Months Ended June 30, 2009			Six Months Ended June 30, 2009
Designated Fair Value Hedging Relationships
Interest Income (Expense):
Interest rate swap agreements (fixed-to-variable)	$	(113	)	$	(151	)
Long-term debt—interest rate swap agreements (fixed-to-variable)		113			151
Investment Income (Expense):
Mark to market adjustments on derivative component of prepaid forward sale agreements		(311	)		(340	)
Unrealized gains (losses) on securities underlying prepaid forward sale agreements		342			380
Gain (Loss) on Fair Value Hedging Relationships		31			40

Nondesignated
Investment Income (Expense):
Mark to market adjustments on derivative component of ZONES		(5	)		4
Total Gain (Loss)	$	26		$	44

The difference between variable and fixed rates received under the terms of our interest rate swap agreements reduced interest expense by approximately $25 million and $48 million during the three and six months ended June 30, 2009, respectively.

Note 7: Noncontrolling Interests

Certain of our subsidiaries that we consolidate are not wholly owned. Some of the agreements with the minority partners of these subsidiaries contain redemption features that are redeemable either (i) at the option of the holder or (ii) upon the occurrence of an event that is not solely within our control. If securities were to be redeemed under these agreements, we would generally be required to purchase the security at fair value on the date of redemption. In accordance with the accounting guidance for the classification and measurement of redeemable securities, these securities are presented on the balance sheet outside of equity under the caption “Redeemable noncontrolling interests.” Noncontrolling interests that do not contain such redemption features are presented in equity.

During the six months ended June 30, 2009, we purchased all of the noncontrolling interest of one of our technology ventures, which had a carrying value of approximately $35 million, for approximately $5 million and rights to existing intellectual property. The difference between the amount paid and the carrying value of the noncontrolling interest resulted in an increase of approximately $30 million to additional paid-in capital of Comcast Corporation.

The table below presents the changes in equity resulting from net income attributable to Comcast Corporation and transfers to or from noncontrolling interests.


(in millions)	Six Months Ended June 30, 2009
Net income attributable to Comcast Corporation	$	1,739
Transfers from (to) noncontrolling interests:
Increase in Comcast Corporation additional paid-in capital resulting from the purchase of noncontrolling interest		30
Change from net income attributable to Comcast Corporation and transfers from (to) noncontrolling interests	$	1,769

Note 8: Equity

Share-Based Compensation

Our Board of Directors may grant share-based awards, in the form of stock options and RSUs, to certain employees and directors. Additionally, through our employee stock purchase plan, employees are able to purchase shares of Comcast Class A common stock at a discount through payroll deductions.

In March 2009, we granted 29.5 million stock options and 10.0 million RSUs related to our annual management grant program. The fair values associated with these grants were $4.94 per stock option and $13.48 per RSU.

Recognized Share-Based Compensation Expense


	Three Months Ended June 30				Six Months Ended June 30
(in millions)	2009		2008		2009		2008
Stock options	$	28	$	24	$	47	$	44
Restricted share units		27		23		40		43
Employee stock purchase plan		2		3		7		8
Total	$	57	$	50	$	94	$	95

As of June 30, 2009, there was $368 million and $340 million of unrecognized pretax compensation cost related to nonvested stock options and nonvested RSUs, respectively.

The employee cost associated with participation in the employee stock purchase plan was satisfied with payroll deductions of approximately $10 million and $27 million for the three and six months ended June 30, 2009, respectively. For the three and six months ended June 30, 2008, the employee cost was approximately $11 million and $28 million, respectively.

Accumulated Other Comprehensive Income (Loss)

The table below presents our accumulated other comprehensive income (loss), net of deferred taxes.


	Six Months Ended June 30
(in millions)	2009			2008
Unrealized gains (losses) on marketable securities	$	27		$	18
Deferred gains (losses) on cash flow hedges		(76	)		(105	)
Unrealized gains (losses) on employee benefit obligations		(31	)		23
Cumulative translation adjustments		—			5
Accumulated other comprehensive income (loss)	$	(80	)	$	(59	)

Deferred losses on cash flow hedges in the table above relate primarily to previous interest rate lock agreements. As of June 30, 2009, we expect $30 million of unrealized losses, $19 million net of deferred taxes, to be reclassified as an adjustment to interest expense over the next 12 months. These amounts include $14 million of deferred losses, $9 million net of deferred taxes, on cash flow hedges for which the related debt was extinguished in July 2009 in connection with the closing of the cash tender offer.

Note 9: Statement of Cash Flows—Supplemental Information

The table below presents our adjustments to reconcile net income from consolidated operations to net cash provided by operating activities.


	Six Months Ended June 30
(in millions)	2009			2008
Net income from consolidated operations	$	1,734		$	1,357
Adjustments to reconcile net income from consolidated operations to net cash provided by operating activities:
Depreciation		2,786			2,761
Amortization		507			459
Share-based compensation		121			123
Noncash interest expense (income), net		81			132
Equity in net (income) losses of affiliates, net		27			39
(Gains) losses on investments and noncash other (income) expense, net		(23	)		(234	)
Deferred income taxes		394			403
Changes in operating assets and liabilities, net of effects of acquisitions and divestitures:
Change in accounts receivable, net		(49	)		(7	)
Change in accounts payable and accrued expenses related to trade creditors		(112	)		(69	)
Change in other operating assets and liabilities		(353	)		(36	)
Net cash provided by operating activities	$	5,113		$	4,928

Cash Payments for Interest and Income Taxes


	Three Months Ended June 30				Six Months Ended June 30
(in millions)	2009		2008		2009		2008
Interest	$	399	$	408	$	1,063	$	1,116
Income taxes	$	585	$	335	$	746	$	355

Noncash Financing and Investing Activities

During the six months ended June 30, 2009, we:

•

recorded a liability of approximately $194 million for a quarterly cash dividend of $0.0675 per common share paid in July 2009, which is a noncash financing activity

•

recorded a liability of approximately $107 million for share repurchases that settled in July 2009, which is a noncash financing activity

•

acquired approximately $342 million of property and equipment and software that was accrued but unpaid, which is a noncash investing activity

Note 10: Commitments and Contingencies

Commitments

One of our subsidiaries supports debt compliance with respect to obligations of a cable system in which we hold an ownership interest. The obligation expires March 2011. Although there can be no assurance, we believe that we will not be required to meet our obligation under this commitment. The total notional amount of our

commitment was $410 million as of June 30, 2009, at which time there were no quoted market prices for similar agreements.

Contingencies

Antitrust Cases

We are defendants in two purported class actions originally filed in December 2003 in the United States District Courts for the District of Massachusetts and the Eastern District of Pennsylvania. The potential class in the Massachusetts case, which has been transferred to the Eastern District of Pennsylvania, is our subscriber base in the “Boston Cluster” area, and the potential class in the Pennsylvania case is our subscriber base in the “Philadelphia and Chicago Clusters,” as those terms are defined in the complaints. In each case, the plaintiffs allege that certain subscriber exchange transactions with other cable providers resulted in unlawful horizontal market restraints in those areas and seek damages under antitrust statutes, including treble damages.

Classes of Philadelphia Cluster and Chicago Cluster subscribers were certified in May 2007 and October 2007, respectively. In March 2009, as a result of a Third Circuit Court of Appeal decision clarifying the standards for class certification, the order certifying the Philadelphia Cluster class was vacated without prejudice to the plaintiffs filing a new motion. A hearing on the plaintiffs’ new motion, which was filed in April 2009, is scheduled for October 2009. The plaintiffs’ claims concerning the other two clusters are stayed pending determination of the Philadelphia Cluster claims.

In addition, we are among the defendants in a purported class action filed in the United States District Court for the Central District of California (“Central District”) in September 2007. The potential class is comprised of all persons residing in the United States who have subscribed to an expanded basic level of video service provided by one of the defendants. The plaintiffs allege that the defendants who produce video programming have entered into agreements with the defendants who distribute video programming via cable and satellite (including us), which preclude the distributor defendants from reselling channels to subscribers on an “unbundled” basis in violation of federal antitrust laws. The plaintiffs seek treble damages and injunctive relief requiring each distributor defendant to resell certain channels to its subscribers on an “unbundled” basis. In July 2009, the Central District issued a tentative ruling dismissing the plaintiffs’ complaint with prejudice. A final ruling is expected in the next several weeks. If the Central District issues a final ruling dismissing the plaintiffs’ complaint with prejudice, the plaintiffs may appeal to the Ninth Circuit Court of Appeals.

ERISA Litigation

We and several of our current officers have been named as defendants in a purported class action lawsuit filed in the United States District Court for the Eastern District of Pennsylvania in February 2008. The alleged class comprises participants in our retirement investment (401(k)) plan that invested in the plan’s company stock account. The plaintiff asserts that the defendants breached their fiduciary duties under the Employee Retirement Income Security Act of 1974 (ERISA) in managing the plan by allowing participants to continue to invest in the company stock account during a time in 2007 when we allegedly knew (but had not disclosed) that we would not meet our forecasted results. The plaintiff seeks unspecified damages. In June 2009, the plaintiff filed a motion to have the case certified as a class action and we filed a response opposing that motion.

Patent Litigation

We are a defendant in several unrelated lawsuits claiming infringement of various patents relating to various aspects of our businesses. In certain of these cases other industry participants are also defendants, and also in certain of these cases we expect that any potential liability would be in part or in whole the responsibility of our equipment vendors under applicable contractual indemnification provisions.

* * *

We believe the claims in each of the actions described above in this item are without merit and intend to defend the actions vigorously. Although we cannot predict the outcome of any of the actions described above or how the final resolution of any such actions would impact our results of operations or cash flows for any one period or our consolidated financial condition, the final disposition of any of the above actions is not expected to have a

material adverse effect on our consolidated financial position, but could possibly be material to our consolidated results of operations or cash flows for any one period.

Other

We are subject to other legal proceedings and claims that arise in the ordinary course of our business. While the amount of ultimate liability with respect to such actions is not expected to materially affect our financial position, results of operations or cash flows, any litigation resulting from any such legal proceedings or claims could be time consuming, costly and injure our reputation.

Note 11: Financial Data by Business Segment

Our reportable segments consist of our Cable and Programming businesses. In evaluating the profitability of our segments, the components of net income (loss) below operating income (loss) before depreciation and amortization are not separately evaluated by our management. Assets are not allocated to segments for management reporting, although approximately 95% of our assets relate to our Cable segment. Our financial data by business segment is presented in the table below.


(in millions)	Cable(a)(b)		Programming(c)		Corporate and Other(d)(e)			Eliminations(e)(f)			Total
Three months ended June 30, 2009
Revenue(g)	$	8,476	$	384	$	153		$	(75	)	$	8,938
Operating income (loss) before depreciation and amortization(h)		3,501		113		(80	)		1			3,535
Depreciation and amortization		1,594		48		26			(8	)		1,660
Operating income (loss)		1,907		65		(106	)		9			1,875
Capital expenditures		1,108		6		7			—			1,121

Three months ended June 30, 2008
Revenue(g)	$	8,100	$	366	$	142		$	(55	)	$	8,553
Operating income (loss) before depreciation and amortization(h)		3,362		89		(98	)		(2	)		3,351
Depreciation and amortization		1,537		45		27			(8	)		1,601
Operating income (loss)		1,825		44		(125	)		6			1,750
Capital expenditures		1,254		6		40			—			1,300

Six months ended June 30, 2009
Revenue(g)	$	16,825	$	745	$	361		$	(158	)	$	17,773
Operating income (loss) before depreciation and amortization(h)		6,907		225		(151	)		(2	)		6,979
Depreciation and amortization		3,156		97		56			(16	)		3,293
Operating income (loss)		3,751		128		(207	)		14			3,686
Capital expenditures		2,238		14		29			—			2,281

Six months ended June 30, 2008
Revenue(g)	$	16,016	$	729	$	325		$	(128	)	$	16,942
Operating income (loss) before depreciation and amortization(h)		6,504		202		(180	)		(1	)		6,525
Depreciation and amortization		3,085		99		51			(15	)		3,220
Operating income (loss)		3,419		103		(231	)		14			3,305
Capital expenditures		2,609		10		112			—			2,731

(a)	For the three and six months ended June 30, 2009 and 2008, Cable segment revenue was derived from the following services:


	Three Months Ended June 30				Six Months Ended June 30
	2009		2008		2009		2008
Video	57.6	%	59.3	%	58.3	%	59.8	%
High-speed Internet	22.8		22.1		22.8		22.1
Phone	9.5		7.9		9.4		7.7
Advertising	3.8		5.0		3.5		4.7
Franchise fees	2.8		2.8		2.8		2.8
Other	3.5		2.9		3.2		2.9
Total	100	%	100	%	100	%	100	%

Subscription revenue received from customers who purchase bundled services at a discounted rate is allocated proportionately to each service based on the individual service’s price on a stand-alone basis.

(b)	Our Cable segment includes our regional sports networks.

(c)	Our Programming segment consists primarily of our consolidated national programming networks, including E!, Golf Channel, VERSUS, G4 and Style.

(d)	Corporate and Other activities include Comcast Interactive Media, Comcast Spectacor, a portion of the operating results of our less than wholly owned technology development ventures (see “(e)” below), corporate activities and all other businesses not presented in our Cable or Programming segments.

(e)

We consolidate our less than wholly owned technology development ventures that we control or of which we are considered the primary beneficiary. These ventures are with various corporate partners, such as Motorola and Gemstar. The ventures have been created to share the costs of development of new technologies for set-top boxes and other devices. The results of these entities are included within Corporate and Other except for cost allocations, which are made to the Cable segment based on our percentage ownership in each entity.

(f)	Included in the Eliminations column are transactions that our segments enter into with one another. The most common types of transactions are the following:

•

our Programming segment generates revenue by selling cable network programming to our Cable segment, which represents a substantial majority of the revenue elimination amount

•

our Cable segment receives incentives offered by our Programming segment when negotiating programming contracts that are recorded as a reduction to programming expenses

•

our Cable segment generates revenue by selling advertising and by selling the use of satellite feeds to our Programming segment

•

our Cable segment generates revenue by providing network services to Comcast Interactive Media

(g)	Non-U.S. revenue was not significant in any period. No single customer accounted for a significant amount of our revenue in any period.

(h)

To measure the performance of our operating segments, we use operating income before depreciation and amortization, excluding impairments related to fixed and intangible assets, and gains or losses from the sale of assets, if any. This measure eliminates the significant level of noncash depreciation and amortization expense that results from the capital-intensive nature of our businesses and from intangible assets recognized in business combinations. It is also unaffected by our capital structure or investment activities. We use this measure to evaluate our consolidated operating performance and the operating performance of our operating segments, and to allocate resources and capital to our operating segments. It is also a significant performance measure in our annual incentive compensation programs. We believe that this measure is useful to investors because it is one of the bases for comparing our operating performance with other companies in our industries, although our measure may not be directly comparable to similar measures used by other companies. This measure should not be considered a substitute for operating income (loss), net income (loss) attributable to Comcast Corporation, net cash provided by operating activities or other measures of performance or liquidity reported in accordance with GAAP.

Note 12: Condensed Consolidating Financial Information

Comcast Corporation and five of our cable holding company subsidiaries, Comcast Cable Communications, LLC (“CCCL”), Comcast Cable Communications Holdings, Inc. (“CCCH”), Comcast MO Group, Inc. (“Comcast MO Group”), Comcast Cable Holdings, LLC (“CCH”) and Comcast MO of Delaware, LLC (“Comcast MO of Delaware”), have fully and unconditionally guaranteed each other’s debt securities. Comcast MO Group, CCH and Comcast MO of Delaware are collectively referred to as the “Combined CCHMO Parents.”

Comcast Corporation unconditionally guarantees the $211 million principal amount currently outstanding of Comcast Holdings’ ZONES due October 2029 and the $202 million principal amount currently outstanding of Comcast Holdings’ 10⁵/8% senior subordinated debentures due 2012. Comcast Corporation does not guarantee the $71 million principal amount outstanding of Comcast Holdings’ ZONES due November 2029. We have included Comcast Holdings’ condensed consolidating financial information for all periods presented. Our condensed consolidating financial information is presented in the tables below.

Comcast Corporation

Condensed Consolidating Balance Sheet

June 30, 2009


(in millions)	Comcast Parent		CCCL Parent		CCCH Parent		Combined CCHMO Parents		Comcast Holdings		Non- Guarantor Subsidiaries		Elimination and Consolidation Adjustments			Consolidated Comcast Corporation
ASSETS
Cash and cash equivalents	$	—	$	—	$	—	$	—	$	—	$	3,989	$	—		$	3,989
Investments		—		—		—		—		—		62		—			62
Accounts receivable, net		—		—		—		—		—		1,677		—			1,677
Other current assets		308		3		—		—		—		498		—			809
Total current assets		308		3		—		—		—		6,226		—			6,537
Investments		—		—		—		—		—		5,190		—			5,190
Investments in and amounts due from subsidiaries eliminated upon consolidation		74,946		35,048		44,299		47,066		27,024		5,240		(233,623	)		—
Property and equipment, net		312		—		—		—		—		23,403		—			23,715
Franchise rights		—		—		—		—		—		59,446		—			59,446
Goodwill		—		—		—		—		—		14,928		—			14,928
Other intangible assets, net		1		—		—		—		—		4,296		—			4,297
Other noncurrent assets, net		375		5		12		—		9		723		—			1,124
Total assets	$	75,942	$	35,056	$	44,311	$	47,066	$	27,033	$	119,452	$	(233,623	)	$	115,237

LIABILITIES AND EQUITY
Accounts payable and accrued expenses related to trade creditors	$	205	$	3	$	—	$	—	$	—	$	2,862	$	—		$	3,070
Accrued expenses and other current liabilities		921		288		72		87		130		1,822		—			3,320
Current portion of long-term debt		2,809		364		625		317		—		52		—			4,167
Total current liabilities		3,935		655		697		404		130		4,736		—			10,557
Long-term debt, less current portion		20,593		2,137		3,180		2,359		328		273		—			28,870
Deferred income taxes		8,067		—		—		—		680		18,647		—			27,394
Other noncurrent liabilities		1,614		—		2		4		171		4,644		—			6,435
Redeemable noncontrolling interests		—		—		—		—		—		167		—			167
Equity:
Common stock		33		—		—		—		—		—		—			33
Other stockholders’ equity		41,700		32,264		40,432		44,299		25,724		90,904		(233,623	)		41,700
Total Comcast Corporation stockholders’ equity		41,733		32,264		40,432		44,299		25,724		90,904		(233,623	)		41,733
Noncontrolling interests		—		—		—		—		—		81		—			81
Total equity		41,733		32,264		40,432		44,299		25,724		90,985		(233,623	)		41,814
Total liabilities and equity	$	75,942	$	35,056	$	44,311	$	47,066	$	27,033	$	119,452	$	(233,623	)	$	115,237

Comcast Corporation

Condensed Consolidating Balance Sheet

December 31, 2008


(in millions)	Comcast Parent		CCCL Parent		CCCH Parent		Combined CCHMO Parents		Comcast Holdings		Non- Guarantor Subsidiaries		Elimination and Consolidation Adjustments			Consolidated Comcast Corporation
ASSETS
Cash and cash equivalents	$	—	$	—	$	—	$	—	$	—	$	1,195	$	—		$	1,195
Investments		—		—		—		—		—		59		—			59
Accounts receivable, net		—		—		—		—		—		1,626		—			1,626
Other current assets		171		8		—		—		—		657		—			836
Total current assets		171		8		—		—		—		3,537		—			3,716
Investments		—		—		—		—		—		4,783		—			4,783
Investments in and amounts due from subsidiaries eliminated upon consolidation		70,076		34,499		43,536		46,314		26,519		4,471		(225,415	)		—
Property and equipment, net		306		—		—		—		—		24,138		—			24,444
Franchise rights		—		—		—		—		—		59,449		—			59,449
Goodwill		—		—		—		—		—		14,889		—			14,889
Other intangible assets, net		1		—		—		—		—		4,557		—			4,558
Other noncurrent assets, net		603		7		14		—		17		537		—			1,178
Total assets	$	71,157	$	34,514	$	43,550	$	46,314	$	26,536	$	116,361	$	(225,415	)	$	113,017

LIABILITIES AND EQUITY
Accounts payable and accrued expenses related to trade creditors	$	196	$	—	$	—	$	—	$	—	$	3,197	$	—		$	3,393
Accrued expenses and other current liabilities		810		224		73		87		129		1,945		—			3,268
Current portion of long-term debt		1,242		1,006		—		—		—		30		—			2,278
Total current liabilities		2,248		1,230		73		87		129		5,172		—			8,939
Long-term debt, less current portion		19,839		2,294		4,462		2,691		610		282		—			30,178
Deferred income taxes		7,160		—		—		—		656		19,166		—			26,982
Other noncurrent liabilities		1,460		—		—		—		119		4,592		—			6,171
Redeemable noncontrolling interests		—		—		—		—		—		171		—			171
Equity:
Common stock		33		—		—		—		—		—		—			33
Other stockholders’ equity		40,417		30,990		39,015		43,536		25,022		86,852		(225,415	)		40,417
Total Comcast Corporation stockholders’ equity		40,450		30,990		39,015		43,536		25,022		86,852		(225,415	)		40,450
Noncontrolling interests		—		—		—		—		—		126		—			126
Total equity		40,450		30,990		39,015		43,536		25,022		86,978		(225,415	)		40,576
Total liabilities and equity	$	71,157	$	34,514	$	43,550	$	46,314	$	26,536	$	116,361	$	(225,415	)	$	113,017

Comcast Corporation

Condensed Consolidating Statement of Operations

For the Three Months Ended June 30, 2009


(in millions)	Comcast Parent			CCCL Parent			CCCH Parent			Combined CCHMO Parents			Comcast Holdings			Non- Guarantor Subsidiaries			Elimination and Consolidation Adjustments			Consolidated Comcast Corporation
Revenue:
Service revenue	$	—		$	—		$	—		$	—		$	—		$	8,938		$	—		$	8,938
Management fee revenue		193			61			108			108			—			—			(470	)		—
		193			61			108			108			—			8,938			(470	)		8,938
Costs and Expenses:
Operating (excluding depreciation and amortization)		—			—			—			—			—			3,545			—			3,545
Selling, general and administrative		82			61			108			108			14			1,955			(470	)		1,858
Depreciation		7			—			—			—			—			1,399			—			1,406
Amortization		—			—			—			—			—			254			—			254
		89			61			108			108			14			7,153			(470	)		7,063
Operating income (loss)		104			—			—			—			(14	)		1,785			—			1,875
Other Income (Expense):
Interest expense		(315	)		(56	)		(84	)		(50	)		(8	)		(38	)		—			(551	)
Investment income (loss), net		—			—			—			—			(4	)		61			—			57
Equity in net income (losses) of affiliates, net		1,104			440			806			839			450			(59	)		(3,593	)		(13	)
Other income (expense)		—			—			—			—			—			12			—			12
		789			384			722			789			438			(24	)		(3,593	)		(495	)
Income (loss) before income taxes		893			384			722			789			424			1,761			(3,593	)		1,380
Income tax (expense) benefit		74			20			29			17			10			(574	)		—			(424	)
Net income (loss) from consolidated operations		967			404			751			806			434			1,187			(3,593	)		956
Net (income) loss attributable to noncontrolling interests		—			—			—			—			—			11			—			11
Net income (loss) attributable to Comcast Corporation	$	967		$	404		$	751		$	806		$	434		$	1,198		$	(3,593	)	$	967

Comcast Corporation

Condensed Consolidating Statement of Operations

For the Three Months Ended June 30, 2008


(in millions)	Comcast Parent			CCCL Parent			CCCH Parent			Combined CCHMO Parents			Comcast Holdings			Non- Guarantor Subsidiaries			Elimination and Consolidation Adjustments			Consolidated Comcast Corporation
Revenue:
Service revenue	$	—		$	—		$	—		$	—		$	—		$	8,553		$	—		$	8,553
Management fee revenue		192			56			103			103			—			—			(454	)		—
		192			56			103			103			—			8,553			(454	)		8,553
Costs and Expenses:
Operating (excluding depreciation and amortization)		—			—			—			—			—			3,334			—			3,334
Selling, general and administrative		93			56			103			103			22			1,945			(454	)		1,868
Depreciation		5			—			—			—			—			1,366			—			1,371
Amortization		—			—			—			—			—			230			—			230
		98			56			103			103			22			6,875			(454	)		6,803
Operating income (loss)		94			—			—			—			(22	)		1,678			—			1,750
Other Income (Expense):
Interest expense		(320	)		(77	)		(82	)		(54	)		(52	)		(33	)		—			(618	)
Investment income (loss), net		(2	)		—			—			—			(43	)		(25	)		—			(70	)
Equity in net income (losses) of affiliates, net		781			370			639			673			296			22			(2,785	)		(4	)
Other income (expense)		(1	)		—			—			—			—			17			—			16
		458			293			557			619			201			(19	)		(2,785	)		(676	)
Income (loss) before income taxes		552			293			557			619			179			1,659			(2,785	)		1,074
Income tax (expense) benefit		80			29			29			20			41			(654	)		—			(455	)
Net income (loss) from consolidated operations		632			322			586			639			220			1,005			(2,785	)		619
Net (income) loss attributable to noncontrolling interests		—			—			—			—			—			13			—			13
Net income (loss) attributable to Comcast Corporation	$	632		$	322		$	586		$	639		$	220		$	1,018		$	(2,785	)	$	632

Comcast Corporation

Condensed Consolidating Statement of Operations

For the Six Months Ended June 30, 2009


(in millions)	Comcast Parent			CCCL Parent			CCCH Parent			Combined CCHMO Parents			Comcast Holdings			Non- Guarantor Subsidiaries			Elimination and Consolidation Adjustments			Consolidated Comcast Corporation
Revenue:
Service revenue	$	—		$	—		$	—		$	—		$	—		$	17,773		$	—		$	17,773
Management fee revenue		384			121			215			215			—			—			(935	)		—
		384			121			215			215			—			17,773			(935	)		17,773
Costs and Expenses:
Operating (excluding depreciation and amortization)		—			—			—			—			—			7,110			—			7,110
Selling, general and administrative		160			121			215			215			28			3,880			(935	)		3,684
Depreciation		14			—			—			—			—			2,772			—			2,786
Amortization		—			—			—			—			—			507			—			507
		174			121			215			215			28			14,269			(935	)		14,087
Operating income (loss)		210			—			—			—			(28	)		3,504			—			3,686
Other Income (Expense):
Interest expense		(634	)		(114	)		(194	)		(100	)		(10	)		(69	)		—			(1,121	)
Investment income (loss), net		(7	)		—			—			—			5			72			—			70
Equity in net income (losses) of affiliates, net		2,019			807			1,518			1,583			801			(95	)		(6,660	)		(27	)
Other income (expense)		—			—			—			—			—			11			—			11
		1,378			693			1,324			1,483			796			(81	)		(6,660	)		(1,067	)
Income (loss) before income taxes		1,588			693			1,324			1,483			768			3,423			(6,660	)		2,619
Income tax (expense) benefit		151			40			68			35			12			(1,191	)		—			(885	)
Net income (loss) from consolidated operations		1,739			733			1,392			1,518			780			2,232			(6,660	)		1,734
Net (income) loss attributable to noncontrolling interests		—			—			—			—			—			5			—			5
Net income (loss) attributable to Comcast Corporation	$	1,739		$	733		$	1,392		$	1,518		$	780		$	2,237		$	(6,660	)	$	1,739

Comcast Corporation

Condensed Consolidating Statement of Operations

For the Six Months Ended June 30, 2008


(in millions)	Comcast Parent			CCCL Parent			CCCH Parent			Combined CCHMO Parents			Comcast Holdings			Non- Guarantor Subsidiaries			Elimination and Consolidation Adjustments			Consolidated Comcast Corporation
Revenue:
Service revenue	$	—		$	—		$	—		$	—		$	—		$	16,942		$	—		$	16,942
Management fee revenue		360			109			202			202			—			—			(873	)		—
		360			109			202			202			—			16,942			(873	)		16,942
Costs and Expenses:
Operating (excluding depreciation and amortization)		—			—			—			—			—			6,695			—			6,695
Selling, general and administrative		177			109			202			202			26			3,879			(873	)		3,722
Depreciation		10			—			—			—			—			2,751			—			2,761
Amortization		—			—			—			—			—			459			—			459
		187			109			202			202			26			13,784			(873	)		13,637
Operating income (loss)		173			—			—			—			(26	)		3,158			—			3,305
Other Income (Expense):
Interest expense		(643	)		(159	)		(162	)		(110	)		(95	)		(70	)		—			(1,239	)
Investment income (loss), net		(9	)		—			—			—			(22	)		40			—			9
Equity in net income (losses) of affiliates, net		1,676			777			1,298			1,369			690			(55	)		(5,794	)		(39	)
Other income (expense)		(1	)		—			—			—			—			285			—			284
		1,023			618			1,136			1,259			573			200			(5,794	)		(985	)
Income (loss) before income taxes		1,196			618			1,136			1,259			547			3,358			(5,794	)		2,320
Income tax (expense) benefit		168			56			57			39			50			(1,333	)		—			(963	)
Net income (loss) from consolidated operations		1,364			674			1,193			1,298			597			2,025			(5,794	)		1,357
Net (income) loss attributable to noncontrolling interests		—			—			—			—			—			7			—			7
Net income (loss) attributable to Comcast Corporation	$	1,364		$	674		$	1,193		$	1,298		$	597		$	2,032		$	(5,794	)	$	1,364

Comcast Corporation

Condensed Consolidating Statement of Cash Flows

For the Six Months Ended June 30, 2009


(in millions)	Comcast Parent			CCCL Parent			CCCH Parent			Combined CCHMO Parents			Comcast Holdings			Non- Guarantor Subsidiaries			Elimination and Consolidation Adjustments		Consolidated Comcast Corporation
Net cash provided by (used in) operating activities	$	155		$	2		$	(87	)	$	(72	)	$	28		$	5,087		$	—	$	5,113
Financing Activities:
Proceeds from borrowings		2,492			—			—			—			—			30			—		2,522
Repurchases and repayments of debt		(33	)		(793	)		(655	)		—			(262	)		(24	)		—		(1,767	)
Repurchases of common stock		(108	)		—			—			—			—			—			—		(108	)
Dividends paid		(375	)		—			—			—			—			—			—		(375	)
Issuances of common stock		1			—			—			—			—			—			—		1
Other		(10	)		—			(4	)		—			—			(8	)		—		(22	)
Net cash provided by (used in) financing activities		1,967			(793	)		(659	)		—			(262	)		(2	)		—		251
Investing Activities:
Net transactions with affiliates		(2,100	)		791			746			72			234			257			—		—
Capital expenditures		(22	)		—			—			—			—			(2,259	)		—		(2,281	)
Cash paid for intangible assets		—			—			—			—			—			(241	)		—		(241	)
Acquisitions, net of cash acquired		—			—			—			—			—			(27	)		—		(27	)
Proceeds from sales of investments		—			—			—			—			—			16			—		16
Purchases of investments		—			—			—			—			—			(67	)		—		(67	)
Other		—			—			—			—			—			30			—		30
Net cash provided by (used in) investing activities		(2,122	)		791			746			72			234			(2,291	)		—		(2,570	)
Increase (decrease) in cash and cash equivalents		—			—			—			—			—			2,794			—		2,794
Cash and cash equivalents, beginning of period		—			—			—			—			—			1,195			—		1,195
Cash and cash equivalents, end of period	$	—		$	—		$	—		$	—		$	—		$	3,989		$	—	$	3,989

Comcast Corporation

Condensed Consolidating Statement of Cash Flows

For the Six Months Ended June 30, 2008


(in millions)	Comcast Parent			CCCL Parent			CCCH Parent			Combined CCHMO Parents			Comcast Holdings			Non- Guarantor Subsidiaries			Elimination and Consolidation Adjustments		Consolidated Comcast Corporation
Net cash provided by (used in) operating activities	$	13		$	(103	)	$	(94	)	$	(85	)	$	61		$	5,136		$	—	$	4,928
Financing Activities:
Proceeds from borrowings		1,998			—			—			—			—			11			—		2,009
Repurchases and repayments of debt		(300	)		(350	)		—			—			(154	)		(27	)		—		(831	)
Repurchases of common stock		(1,979	)		—			—			—			—			—			—		(1,979	)
Dividends paid		(185	)		—			—			—			—			—			—		(185	)
Issuances of common stock		42			—			—			—			—			—			—		42
Other		(3	)		—			—			—			(53	)		(79	)		—		(135	)
Net cash provided by (used in) financing activities		(427	)		(350	)		—			—			(207	)		(95	)		—		(1,079	)
Investing Activities:
Net transactions with affiliates		556			453			94			85			146			(1,334	)		—		—
Capital expenditures		(104	)		—			—			—			—			(2,627	)		—		(2,731	)
Cash paid for intangible assets		—			—			—			—			—			(245	)		—		(245	)
Acquisitions, net of cash acquired		—			—			—			—			—			(331	)		—		(331	)
Proceeds from sales of investments		—			—			—			—			—			320			—		320
Purchases of investments		—			—			—			—			—			(41	)		—		(41	)
Other		(38	)		—			—			—			—			21			—		(17	)
Net cash provided by (used in) investing activities		414			453			94			85			146			(4,237	)		—		(3,045	)
Increase (decrease) in cash and cash equivalents		—			—			—			—			—			804			—		804
Cash and cash equivalents, beginning of period		—			—			—			—			—			963			—		963
Cash and cash equivalents, end of period	$	—		$	—		$	—		$	—		$	—		$	1,767		$	—	$	1,767

ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

We are the nation’s leading provider of cable services, offering a variety of entertainment, information and communications services to residential and commercial customers. As of June 30, 2009, our cable systems served approximately 23.9 million video customers, 15.3 million high-speed Internet customers and 7.0 million phone customers and passed over 50.9 million homes in 39 states and the District of Columbia. We report the results of these operations as our Cable segment, which generates approximately 95% of our revenue. Our Cable segment generates revenue primarily through subscriptions to our video, high-speed Internet and phone services (“cable services”). Other Cable segment revenue sources include advertising and the operation of our regional sports networks. Our other reportable segment, Programming, consists primarily of our consolidated national programming networks, including E!, Golf Channel, VERSUS, G4 and Style. Revenue from our Programming segment is generated primarily from the sale of advertising, from monthly per subscriber license fees paid by multichannel video providers and from licensing our programming internationally.

Highlights and business developments for the six months ended June 30, 2009 include the following:

•

an increase in consolidated revenue of 4.9% to approximately $17.8 billion and an increase in consolidated operating income of 11.5% to approximately $3.7 billion compared to the same period in 2008

•

an increase in Cable segment revenue of 5.1% to approximately $16.8 billion and an increase in operating income before depreciation and amortization of 6.2% to approximately $6.9 billion compared to the same period in 2008

•

the addition of approximately 393,000 high-speed Internet customers, approximately 531,000 digital phone customers, a decrease of approximately 292,000 video customers and the addition or upgrade of approximately 538,000 digital video customers

•

a reduction in Cable segment capital expenditures of 14.2% to approximately $2.2 billion compared to the same period in 2008

•

the repurchase of approximately 15.5 million shares of our Class A and Class A Special common stock under our share repurchase authorization for approximately $215 million

•

the initiation of a cash tender offer to repurchase $1.3 billion aggregate principal amount of our outstanding notes using proceeds from borrowings and cash from operations

Consolidated Operating Results


	Three Months Ended June 30						Increase/ (Decrease)		Six Months Ended June 30						Increase/ (Decrease)
(in millions)	2009			2008					2009			2008
Revenue	$	8,938		$	8,553		4.5	%	$	17,773		$	16,942		4.9	%
Costs and Expenses:
Operating, selling, general and administrative (excluding depreciation and amortization)		5,403			5,202		3.8			10,794			10,417		3.6
Depreciation		1,406			1,371		2.6			2,786			2,761		0.9
Amortization		254			230		10.6			507			459		10.4
Operating income		1,875			1,750		7.1			3,686			3,305		11.5
Other income (expense) items, net		(495	)		(676	)	(26.8	)		(1,067	)		(985	)	8.3
Income before income taxes		1,380			1,074		28.6			2,619			2,320		12.9
Income tax expense		(424	)		(455	)	(6.7	)		(885	)		(963	)	(8.1	)
Net income from consolidated operations		956			619		54.5			1,734			1,357		27.8
Net (income) loss attributable to noncontrolling interests		11			13		(15.4	)		5			7		(28.6	)
Net income attributable to Comcast Corporation	$	967		$	632		53.0	%	$	1,739		$	1,364		27.5	%

All percentages are calculated based on actual amounts. Minor differences may exist due to rounding.

Consolidated Revenue

Our Cable segment and Programming segment accounted for substantially all of the increases in consolidated revenue for the three and six months ended June 30, 2009 compared to the same periods in 2008. Our other business activities consist primarily of Comcast Interactive Media and Comcast Spectacor. Cable segment revenue and Programming segment revenue are discussed separately in “Segment Operating Results.”

Consolidated Operating, Selling, General and Administrative Expenses

Our Cable segment accounted for substantially all of the increases in consolidated operating, selling, general and administrative expenses for the three and six months ended June 30, 2009 compared to the same periods in 2008. The remaining changes related to our other business activities, primarily growth in our Comcast Interactive Media business and Comcast Spectacor. Cable segment and Programming segment operating, selling, general and administrative expenses are discussed separately in “Segment Operating Results.”

Consolidated Depreciation and Amortization

Depreciation expense for the three and six months ended June 30, 2009 compared to the same periods in 2008 increased slightly primarily due to capital expenditures.

The increases in amortization expense for the three and six months ended June 30, 2009 compared to the same periods in 2008 were primarily due to increases in software intangibles.

Segment Operating Results

Our segment operating results are presented based on how we assess operating performance and internally report financial information. To measure the performance of our operating segments, we use operating income before depreciation and amortization, excluding impairments related to fixed and intangible assets, and gains or losses from the sale of assets, if any. This measure eliminates the significant level of noncash depreciation and amortization expense that results from the capital-intensive nature of our businesses and from intangible assets recognized in business combinations. Additionally, it is unaffected by our capital structure or investment activities. We use this measure to evaluate our consolidated operating performance and the operating performance of our operating segments, and to allocate resources and capital to our operating segments. It is also a significant performance measure in our annual incentive compensation programs. We believe that this measure is useful to investors because it is one of the bases for comparing our operating performance with that of other

companies in our industries, although our measure may not be directly comparable to similar measures used by other companies. Because we use this metric to measure our segment profit or loss, we reconcile it to operating income, the most directly comparable financial measure calculated and presented in accordance with generally accepted accounting principles in the United States (“GAAP”) in the business segment footnote to our consolidated financial statements (see Note 11 to our condensed consolidated financial statements). This measure should not be considered a substitute for operating income (loss), net income (loss) attributable to Comcast Corporation, net cash provided by operating activities, or other measures of performance or liquidity we have reported in accordance with GAAP.

Cable Segment Operating Results


	Three Months Ended June 30				Increase/(Decrease)
(in millions)	2009		2008		$			%
Video^(a)	$	4,884	$	4,800	$	84		1.7	%
High-speed Internet		1,929		1,792		137		7.7
Phone		801		640		161		25.3
Advertising^(a)		325		405		(80	)	(19.6	)
Other^(a)		299		236		63		26.0
Franchise fees		238		227		11		4.9
Revenue		8,476		8,100		376		4.6
Operating expenses^(a)		3,350		3,141		209		6.7
Selling, general and administrative expenses^(a)		1,625		1,597		28		1.8
Operating income before depreciation and amortization	$	3,501	$	3,362	$	139		4.1	%



	Six Months Ended June 30				Increase/(Decrease)
(in millions)	2009		2008		$			%
Video^(a)	$	9,813	$	9,578	$	235		2.4	%
High-speed Internet		3,838		3,542		296		8.4
Phone		1,578		1,227		351		28.6
Advertising^(a)		587		751		(164	)	(21.9	)
Other^(a)		537		467		70		15.1
Franchise fees		472		451		21		4.7
Revenue		16,825		16,016		809		5.1
Operating expenses^(a)		6,695		6,304		391		6.2
Selling, general and administrative expenses^(a)		3,223		3,208		15		0.5
Operating income before depreciation and amortization	$	6,907	$	6,504	$	403		6.2	%

(a) Reclassifications have been made to 2008 amounts to conform to classifications used in 2009.

Cable Segment Revenue

Video

Our video revenue increased during the three and six months ended June 30, 2009 compared to the same periods in 2008 primarily due to rate adjustments and customer upgrades to digital and advanced services, offset by a decline in video customers. During the three and six months ended June 30, 2009, the number of video customers decreased by approximately 214,000 and 292,000, respectively, primarily due to increased competition in our service areas, as well as the weakness in the economy. During the three and six months ended June 30, 2009, we added or upgraded approximately 250,000 and 538,000 customers to our digital video service, respectively. As of June 30, 2009, approximately 73% of our 23.9 million video customers subscribed to at least one of our digital video services. Our average monthly video revenue per video customer increased to approximately $68 as of June 30, 2009 from approximately $65 as of June 30, 2008. Continued competition and weak economic conditions are expected to result in further declines in the number of video customers.

High-Speed Internet

The increases in high-speed Internet revenue for the three and six months ended June 30, 2009 compared to the same periods in 2008 were primarily due to increases in the number of residential and commercial customers. During the three and six months ended June 30, 2009, we added approximately 65,000 and 393,000 high-speed Internet customers, respectively. Average monthly revenue per high-speed Internet customer has remained relatively stable. The rate of residential customer and revenue growth has slowed due to increased competition and weak economic conditions.

Phone

Our phone revenue increased for the three and six months ended June 30, 2009 compared to the same periods in 2008 due to increases in the number of phone customers. During the three and six months ended June 30, 2009, we added approximately 233,000 and 531,000 digital phone customers, respectively. Average monthly revenue per phone customer has remained relatively stable. The rate of customer and revenue growth has slowed due to increased competition and weak economic conditions.

Advertising

Advertising revenue decreased for the three and six months ended June 30, 2009 compared to the same periods in 2008 primarily due to a decline in the overall television advertising market as a result of weak economic conditions, particularly in the automotive and housing sectors, and a decline in political advertising.

Other

We also generate revenue from our regional sports networks, our digital media center, on-screen guide advertising, commissions from electronic retailing networks and fees for other services.

Franchise Fees

The increases in franchise fees collected from our cable customers for the three and six months ended June 30, 2009 compared to the same periods in 2008 were primarily due to increases in the revenue on which the fees apply.

Cable Segment Operating Expenses


	Three Months Ended June 30				Increase/(Decrease)
(in millions)	2009		2008		$			%
Video programming	$	1,757	$	1,611	$	146		9.1	%
Technical labor		574		516		58		11.2
High-speed Internet		117		136		(19	)	(14.2	)
Phone		149		182		(33	)	(18.0	)
Other		753		696		57		8.2
Total operating expenses	$	3,350	$	3,141	$	209		6.7	%

	Six Months Ended June 30				Increase/(Decrease)
(in millions)	2009		2008		$			%
Video programming	$	3,532	$	3,230	$	302		9.4	%
Technical labor		1,147		1,039		108		10.4
High-speed Internet		237		274		(37	)	(13.7	)
Phone		318		382		(64	)	(16.8	)
Other		1,461		1,379		82		6.0
Total operating expenses	$	6,695	$	6,304	$	391		6.2	%

Video programming expenses increased during the three and six months ended June 30, 2009 compared to the same periods in 2008 primarily due to rate increases, additional digital customers and additions to the number of programming options we offer. Technical labor expenses increased during the three and six months ended

June 30, 2009 compared to the same periods in 2008 primarily due to growth in the number of customers, including activity associated with the transition by broadcasters from analog to digital transmission.

High-speed Internet expenses and phone expenses include certain direct costs identified by us for providing these services, but do not fully reflect the amounts for operating expenses that would be necessary to provide these services on a stand-alone basis. Other related costs associated with providing these services are generally shared among all our cable services and are not allocated to these captions. Our high-speed Internet and phone expenses decreased during the three and six months ended June 30, 2009 compared to the same periods in 2008 primarily due to lower support service costs that were the result of operating efficiencies and our entering into new contracts with lower cost providers and renegotiating existing contracts. Other expenses increased during the three and six months ended June 30, 2009 compared to the same periods in 2008 primarily due to the continued expansion of our cable services to small and medium-sized businesses and an increase in franchise fees.

Cable Segment Selling, General and Administrative Expenses


	Three Months Ended June 30				Increase/(Decrease)
(in millions)	2009		2008		$			%
Customer service	$	462	$	434	$	28		6.4	%
Marketing		402		411		(9	)	(2.0	)
Administrative and other		761		752		9		1.1
Total selling, general and administrative expenses	$	1,625	$	1,597	$	28		1.8	%


	Six Months Ended June 30				Increase/(Decrease)
(in millions)	2009		2008		$			%
Customer service	$	940	$	876	$	64		7.3	%
Marketing		771		810		(39	)	(4.7	)
Administrative and other		1,512		1,522		(10	)	(0.7	)
Total selling, general and administrative expenses	$	3,223	$	3,208	$	15		0.5	%

Customer service expenses increased during the three and six months ended June 30, 2009 compared to the same periods in 2008 primarily due to the growth in activity associated with the transition by broadcasters from analog to digital transmission. Marketing expenses decreased during the three and six months ended June 30, 2009 compared to the same periods in 2008 primarily due to the timing of our marketing campaigns and lower costs for media advertising. Administrative and other expenses remained relatively stable during the three and six months ended June 30, 2009 compared to the same periods in 2008 primarily due to the impact of our divisional reorganization and other cost reduction programs implemented in 2008.

Programming Segment Operating Results


	Three Months Ended June 30				Increase/(Decrease)
(in millions)	2009		2008		$			%
Revenue	$	384	$	366	$	18		5.1	%
Operating, selling, general and administrative expenses		271		277		(6	)	(2.3	)
Operating income before depreciation and amortization	$	113	$	89	$	24		28.3	%


	Six Months Ended June 30				Increase/(Decrease)
(in millions)	2009		2008		$			%
Revenue	$	745	$	729	$	16		2.2	%
Operating, selling, general and administrative expenses		520		527		(7	)	(1.4	)
Operating income before depreciation and amortization	$	225	$	202	$	23		11.5	%

Programming Segment Revenue

Programming segment revenue increased for the three and six months ended June 30, 2009 compared to the same periods in 2008 primarily due to an increase in programming license fee revenue, which was partially offset by a decrease in advertising revenue. For the three and six months ended June 30, 2009, advertising accounted for approximately 42% and 41%, respectively, of total Programming segment revenue. For the three and six months ended June 30, 2008, advertising accounted for approximately 47% and 45%, respectively, of total Programming segment revenue. For each of the 2009 and 2008 three and six month periods, approximately 12% of our Programming segment revenue was generated from our Cable segment. These amounts are eliminated in our consolidated financial statements but are included in the amounts presented in the table above.

Consolidated Other Income (Expense) Items


	Three Months Ended June 30						Six Months Ended June 30
(in millions)	2009			2008			2009			2008
Interest expense	$	(551	)	$	(618	)	$	(1,121	)	$	(1,239	)
Investment income (loss), net		57			(70	)		70			9
Equity in net income (losses) of affiliates, net		(13	)		(4	)		(27	)		(39	)
Other income (expense)		12			16			11			284
Total	$	(495	)	$	(676	)	$	(1,067	)	$	(985	)

Interest Expense

The decreases in interest expense for the three and six months ended June 30, 2009 compared to the same periods in 2008 were primarily due to the effects of early extinguishment costs associated with the repayment and redemption of certain of our debt obligations in the 2008 periods, as well as to the effects of decreases in interest rates on our variable rate debt and on debt subject to variable interest rate swap agreements.

Investment Income (Loss), Net

The components of investment income (loss), net for the three and six months ended June 30, 2009 and 2008 are presented in a table in Note 4 to our condensed consolidated financial statements.

Other Income (Expense)

For the six months ended June 30, 2008, other income included a gain of approximately $235 million on the sale of our 50% interest in the Insight asset pool in connection with the Insight transaction.

Income Tax Expense

Income tax expense for the three and six months ended June 30, 2009 and 2008 reflects income tax rates that differ from the federal statutory rate primarily due to state income taxes and interest on uncertain tax positions. Income tax expense for the three and six months ended June 30, 2009 was reduced by approximately $137 million and $185 million, respectively, primarily due to the favorable settlements of uncertain tax positions and related interest. As a result of these settlements, we expect our 2009 annual effective tax rate to be below our normal rate of approximately 40%.

Liquidity and Capital Resources

Our businesses generate significant cash flows from operating activities. We believe that we will be able to meet our current and long-term liquidity and capital requirements, including fixed charges, through our cash flows from operating activities; through existing cash, cash equivalents and investments; through available borrowings under our existing credit facilities; and through our ability to obtain future external financing. We anticipate that we will continue to use a substantial portion of our cash flows to fund our capital expenditures, to invest in business opportunities, to meet our debt repayment obligations and to return capital to shareholders.

Operating Activities

Details of net cash provided by operating activities are presented in the table below.


	Six Months Ended June 30
(in millions)	2009			2008
Operating income	$	3,686		$	3,305
Depreciation and amortization		3,293			3,220
Operating income before depreciation and amortization		6,979			6,525
Noncash share-based compensation expense		121			123
Changes in operating assets and liabilities		(236	)		(293	)
Cash basis operating income		6,864			6,355
Payments of interest		(1,063	)		(1,116	)
Payments of income taxes		(746	)		(355	)
Proceeds from interest and dividends received		58			59
Excess tax benefit under share-based compensation presented in financing activities		—			(15	)
Net cash provided by operating activities	$	5,113		$	4,928

The decrease in interest payments for the six months ended June 30, 2009 compared to the same period in 2008 was primarily due to the effects of decreases in interest rates on debt subject to variable interest rate swap agreements and to the maturity in 2008 of certain of our higher rate debt. The increase in income tax payments for the six months ended June 30, 2009 compared to the same period in 2008 was primarily due to higher 2009 taxable income and a tax payment made in 2009 that related to 2008.

Financing Activities

Net cash provided by financing activities for the six months ended June 30, 2009 consisted primarily of cash proceeds from borrowings of $2.5 billion which were substantially offset by debt repurchases and repayments, share repurchases and dividend payments totaling $2.2 billion.

In June 2009, we initiated a cash tender offer to purchase up to $1.3 billion aggregate principal amount of certain of our outstanding notes. As of June 30, 2009, approximately $1.7 billion aggregate principal amount of these notes was tendered to us, of which we accepted tenders for $1.3 billion principal amount. The tender offer settled in July 2009. We anticipate recognizing additional interest expense of approximately $180 million primarily associated with the premiums incurred in the tender offer during the three months ended September 30, 2009. See Note 5 to our condensed consolidated financial statements for further details on our borrowings and repayments of debt.

We have in the past made and may from time to time in the future make optional repayments on our debt obligations depending on various factors, such as market conditions. These repayments may include repurchases of our outstanding public notes and debentures.

Available Borrowings Under Credit Facilities

We traditionally maintain significant availability under our lines of credit and commercial paper program to meet our short-term liquidity requirements. As of June 30, 2009, amounts available under our facilities totaled approximately $5.1 billion.

Share Repurchases

During the six months ended June 30, 2009, we repurchased approximately 15.5 million shares of our Class A and Class A Special common stock under our share repurchase authorization for approximately $215 million. Approximately $107 million, or 7.6 million shares, of our share repurchases did not settle until July 2009.

As of June 30, 2009, we had approximately $3.9 billion of availability remaining under our share repurchase authorization and we may repurchase stock from time to time subject to market conditions.

Dividends

In February, May and July 2009, our Board of Directors approved a quarterly dividend of $0.0675 per share as part of our planned annual dividend of $0.27 per share.

Quarterly Dividends Declared


(in millions)	Amount		Month of Payment
Three months ended March 31, 2009	$	195	April
Three months ended June 30, 2009	$	194	July

Dividends declared in July 2009 are expected to be paid in October 2009.

Investing Activities

Net cash used in investing activities for the six months ended June 30, 2009 consisted primarily of cash paid for capital expenditures of $2.3 billion and cash paid for intangible assets of $241 million. Capital expenditures have been our most significant recurring investing activity and we expect that this will continue in the future.

Critical Accounting Judgments and Estimates

The preparation of our consolidated financial statements requires us to make estimates that affect the reported amounts of assets, liabilities, revenue and expenses, and the related disclosure of contingent assets and contingent liabilities. We base our judgments on historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making estimates about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

We believe our judgments and related estimates associated with the valuation and impairment testing of our cable franchise rights and the accounting for income taxes are critical in the preparation of our consolidated financial statements.

For a full discussion of the accounting judgments and estimates that we have identified as critical in the preparation of our consolidated financial statements, please refer to our 2008 Annual Report on Form 10-K.

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We have evaluated the information required under this item that was disclosed in our 2008 Annual Report on Form 10-K and believe there have been no significant changes to this information.

ITEM 4: CONTROLS AND PROCEDURES

Conclusions Regarding Disclosure Controls and Procedures

Our principal executive officer and our principal financial officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this report, have concluded that, based on the evaluation of these controls and procedures required by paragraph (b) of Exchange Act Rules 13a-15 or 15d-15, our disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II: OTHER INFORMATION

ITEM 1: LEGAL PROCEEDINGS

Refer to Note 10 to our consolidated financial statements of this Quarterly Report on Form 10-Q for a discussion of recent developments related to our legal proceedings.

ITEM 1A: RISK FACTORS

There have been no significant changes from the risk factors previously disclosed in Item 1A of our 2008 Annual Report on Form 10-K.

ITEM 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The table below summarizes our repurchases under our Board-authorized share repurchase program during the three months ended June 30, 2009.

Purchases of Equity Securities


Period	Total Number of Shares Purchased	Average Price Per Share		Total Number of Shares Purchased as Part of Publicly Announced Program	Total Dollar Amount Purchased Under the Program		Maximum Dollar Value of Shares That May Yet Be Purchased Under the Program (a)
April 1-30, 2009	—	$	—	—	$	—	$	4,106,044,773
May 1-31, 2009	—	$	—	—	$	—	$	4,106,044,773
June 1-30, 2009	15,546,200	$	13.83	15,546,200	$	215,008,681	$	3,891,036,092
Total	15,546,200	$	13.83	15,546,200	$	215,008,681	$	3,891,036,092

(a)

In 2007, the Board of Directors authorized a $7 billion addition to the existing share repurchase program. Under the authorization, we may repurchase shares in the open market or in private transactions subject to market conditions. The share repurchase program does not have an expiration date. As of June 30, 2009, the maximum dollar value of shares available under our Board-authorized share repurchase program was approximately $3.9 billion and we may repurchase stock from time to time subject to market conditions.

The total number of shares purchased during the three months ended June 30, 2009 does not include any shares received in the administration of employee share-based compensation plans.

ITEM 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

At our annual meeting of shareholders on May 13, 2009, the shareholders approved, or did not approve, the following proposals, in each case consistent with the unanimous recommendations of our Board of Directors (numbers represent the aggregate votes cast, with holders of our Class A Common Stock entitled to 0.1374 votes per share and holders of our Class B Common Stock entitled to 15 votes per share):

To elect the following nominees to serve as our directors for one-year terms.


Director	For	Withheld
S. Decker Anstrom	312,206,533	62,812,827
Kenneth J. Bacon	363,406,043	11,613,317
Sheldon M. Bonovitz	370,539,671	4,479,689
Edward D. Breen	371,002,926	4,016,434
Julian A. Brodsky	370,263,484	4,755,876
Joseph J. Collins	319,743,502	55,275,858
J. Michael Cook	369,734,624	5,284,736
Gerald L. Hassell	363,624,161	11,395,199
Jeffrey A. Honickman	369,772,877	5,246,483
Brian L. Roberts	367,427,255	7,592,105
Ralph J. Roberts	369,587,303	5,432,057
Dr. Judith Rodin	314,196,287	60,823,073
Michael I. Sovern	319,249,792	55,769,568

To ratify the appointment of Deloitte & Touche LLP as our independent auditors for the 2009 fiscal year.


For	Against	Abstain
369,890,012	4,820,811	308,537

To approve the 2002 Employee Stock Purchase Plan, as amended and restated.


For	Against	Abstain
345,238,815	2,706,005	377,301

To approve the 2002 Restricted Stock Plan, as amended and restated.


For	Against	Abstain
331,246,272	16,612,850	462,999

To approve the 2003 Stock Option Plan, as amended and restated.


For	Against	Abstain
332,346,881	15,541,091	434,149

To identify all executive officers who earn in excess of $500,000.


For	Against	Abstain
12,190,882	335,779,543	351,696

To obtain shareholder approval of certain future death benefit arrangements.


For	Against	Abstain
76,838,653	267,833,972	3,649,496

To adopt an annual vote on executive compensation.


For	Against	Abstain
89,826,677	251,180,636	7,314,808

To adopt a recapitalization plan.


For	Against	Abstain
134,766,525	212,597,044	958,552

ITEM 5: OTHER INFORMATION

Effective August 5, 2009, we amended and restated our Articles of Incorporation to change our registered address from 1500 Market Street, Philadelphia, PA 19102 to CT Corporation System, Philadelphia County, Pennsylvania.

ITEM 6: EXHIBITS


Exhibit No.		Description
3.1		Amended and Restated Articles of Incorporation of Comcast Corporation.
3.2		Amended and Restated By-Laws of Comcast Corporation.
10.1*		Employment Agreement between Comcast Corporation and Julian A. Brodsky dated May 1, 2009.
10.2*		Second Amendment to Employment Agreement between Comcast Corporation and Ralph J. Roberts dated December 10, 2008.
10.3		Form of Director Indemnification Agreement.
31		Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32		Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101		The following financial statements from Comcast Corporation’s Quarterly Report on Form 10-Q for the three and six months ended June 30, 2009, filed with the Securities and Exchange Commission on August 6, 2009, formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheet; (ii) the Condensed Consolidated Statement of Operations; (iii) the Condensed Consolidated Statement of Cash Flows; (iv) the Condensed Consolidated Statement of Changes in Equity; (v) the Condensed Consolidated Statement of Comprehensive Income and (vi) the Notes to Condensed Consolidated Financial Statements, tagged as blocks of text.

*	Constitutes a management contract or compensatory plan or arrangement.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

COMCAST CORPORATION

/s/ LAWRENCE J. SALVA

Lawrence J. Salva

Senior Vice President, Chief Accounting Officer

and Controller

(Principal Accounting Officer)

Date: August 6, 2009

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