Comcast will spin off its shrinking portfolio of cable networks — which includes MSNBC, CNBC, USA, Oxygen, E!, Syfy and the Golf Channel — into a standalone, publicly traded company, TheWrap has learned. An official announcement is expected as early as Wednesday.

The move, which was first reported by The Wall Street Journalis expected to be structured as a tax-free spin-off for Comcast shareholders that will take about a year to complete. The ownership structure of the venture will see Comcast Chairman and CEO Brian Roberts own a third of the voting interest, although he will not be on the board of directors of the demerged entity.

The move to shed cable assets reflects a larger trend in the television industry as viewers flee to streaming platforms and ditch the cable bill. A reduction in the value of linear assets by competitors follows Paramount and Warner Bros Discovery earlier this year, while Disney just took a $584 million cut of its linear entertainment networks during the fourth quarter of 2024.

By creating the new standalone company, Comcast has clearly signaled its conclusion that cable acts as a cap on NBCUniversal’s stock value.

NBCUniversal Media Group President Mark Lazarus is expected to lead the business as CEO, while NBCU CFO Anand Kini will serve as CFO and COO of the separate entity, an insider told TheWrap.

Meanwhile, Chief Content Officer Donna Langley will become president of NBCUniversal studios and entertainment, where she will gain more control over content production and spending, while direct-to-consumer head Matt Strauss will succeed Lazarus as president of NBCUniversal Media Group. Cesar Conde will remain president of NBCUniversal News Group, while executive vice president Adam Miller will become NBCU’s chief operating officer.

The restructuring means news chief Conde will lose authority over significant media assets, including MSNBC and CNBC. Many questions remain about what may or may not be the relationship between NBC News and the cable news channels — MSNBC in particular has been besieged by crater ratings in the post-election days – after the split.

Bravo, which is known for reality TV series like “The Real Housewives,” will remain with Comcast, along with Peacock and broadcast network NBC.

Comcast representatives declined to comment.

Playing Offense

Comcast first revealed it was studying a potential spin-off from its cable portfolio during its time third quarter earnings call last month. That portfolio generated roughly $7 billion in revenue for the 12 months ended Sept. 30.

“Like many of our media peers, we are experiencing the effects of the transition in our video businesses and have studied the best path forward for these assets,” Comcast Chairman Mike Cavanagh told analysts at the time. “To that end, we are now exploring whether the creation of a new well-capitalized company owned by our shareholders and comprised of our strong portfolio of cable networks would position them to take advantage of the opportunities in the changing media landscape and create value for our shareholders . We’re not ready to talk about specifics yet, but we’ll get back to you as we come to firm conclusions.”

Cavanagh declined to say how a potential spin-off would impact total revenue, stressing that the company doesn’t want to get ahead of itself. Still, he appreciated Comcast’s “very strong hand.”

“I think the idea of ​​playing offense, when you combine the strength of the balance sheet that we have, the assets that we have and the management team that we have, can be some smart things to do and we want to study that,” he added he. .

Analysts previously told TheWrap that a Comcast cable spinoff could be an opportunity to create a roll-up vehicle for the struggling linear TV assets of other companies suffering from cord-cutting as consumers switch to streaming .

During the second quarter of 2024, Paramount Global and Warner Bros. Discovery took a collective $15 billion cut in the value of their cable networks amid a soft U.S. linear advertising market. Meanwhile, Disney took a $584 million cut from its linear entertainment networks during the fourth quarter of 2024.

The inexorable decline of cable

In the third quarter of 2024, Comcast lost 365,000 pay TV subscribers for a total of 12.8 million, with video revenue falling 6.2% year-over-year to $6.7 billion .

Total media revenue increased by 36.5% to $8.23 billion due to higher advertising and domestic distribution revenue. Excluding the impact of the Olympics, media revenue rose 4.9% to $6.34 billion.

The Paris Olympics and additional Peacock sales fueled a 74.9% increase in domestic advertising revenue to $3.35 billion, which was partially offset by lower revenue at the company’s networks. Domestic distribution revenue rose 26.3% to $3.27 billion, which mainly reflected the broadcast of the Paris Olympics and higher revenue from Peacock. International network revenue increased 5% to $1.07 billion due to the positive impact of foreign currency and increased revenue associated with sports network distribution. Other revenue increased 7.2% to $542 million, primarily due to higher content licensing revenue.

Adjusted EBITDA for the media segment decreased 10% to $650 million due to higher operating expenses due to increased sports programming costs associated with the Olympics, higher programming costs at Peacock and increased costs of other sports programs for domestic television networks.

Comcast shares rose more than 2 percent in after-hours trading on the news.

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