Investments

12 Months Ended

Dec. 31, 2017

Fair Value, Equity And Cost Method Investments [Line Items]

Note 7: Investments



December 31 (in millions)	2017		2016
Fair Value Method:
Snap	$	430	$	—
Other	167		198
	597		198
Equity Method:
Atairos	2,388		1,601
Hulu	249		225
Other	909		550
	3,546		2,376
Cost Method:
AirTouch	1,614		1,599
BuzzFeed	400		400
Other	793		771
	2,807		2,770
Total investments	6,950		5,344
Less: Current investments	19		97
Noncurrent investments	$	6,931	$	5,247



Investment Income (Loss), Net
Year ended December 31 (in millions)	2017			2016			2015
Gains (losses) on sales of investments, net	$	12		$	46		$	12
Investment impairment losses	(29		)	(34		)	(59		)
Interest and dividend income	136			123			115
Other, net	134			78			13
Investment income (loss), net	$	253		$	213		$	81

Fair Value Method

We classify publicly traded investments that are not accounted for under the equity method as available-for-sale (“AFS”) or trading securities. The estimated fair value of our publicly traded investments was primarily based on Level 1 inputs that use quoted market values. For other fair value method investments, the estimated fair value was based on Level 2 inputs that use pricing models whose inputs are derived primarily from or corroborated by observable market data through correlation or other means. For AFS securities, we record unrealized gains or losses resulting from changes in fair value between measurement dates as a component of other comprehensive income (loss), except when we consider declines in value to be other than temporary. For trading securities, we record unrealized gains or losses resulting from changes in fair value between measurement dates as a component of investment income (loss), net. We recognize realized gains and losses associated with our fair value method investments using the specific identification method. We classify the cash flows related to purchases of and proceeds from the sale of trading securities based on the nature of the securities and the purpose for which they were acquired.

Snap

In March 2017, we acquired an interest in Snap Inc. for $500 million as part of its initial public offering, which we have classified as an available-for-sale security. Snap is a camera company whose primary product is Snapchat, a camera app that was created to help people communicate through short videos and images.

Equity Method

We use the equity method to account for investments in which we have the ability to exercise significant influence over the investee’s operating and financial policies or in which we hold a significant partnership or limited liability company interest. Equity method investments are recorded at cost and are adjusted to recognize (1) our proportionate share of the investee’s net income or loss after the date of investment, (2) amortization of the recorded investment that exceeds our share of the book value of the investee’s net assets, (3) additional contributions made and dividends received, and (4) impairments resulting from other-than-temporary declines in fair value. For some investments, we record our share of the investee’s net income or loss one quarter in arrears due to the timing of our receipt of such information. Gains or losses on the sale of equity method investments are recorded to other income (expense), net. If an equity method investee were to issue additional securities that would change our proportionate share of the entity, we would recognize the change, if any, as a gain or loss to other income (expense), net.

Atairos

On January 1, 2016, we established Atairos Group, Inc., a strategic company focused on investing in and operating companies in a range of industries and business sectors, both domestically and internationally. Atairos has a term of up to 12 years and is controlled by management companies led by our former CFO through interests that carry all of the voting rights. We are the only investor other than our former CFO and the other management company employees. We have committed to fund Atairos up to $4 billion in the aggregate at any one time, subject to certain offsets, and $40 million annually for a management fee, subject to certain adjustments. The management company investors have committed to fund up to $100 million, with at least $40 million to be funded by our former CFO, subject to his continued role with Atairos. Our economic interests do not carry voting rights and obligate us to absorb approximately 99% of any losses and they provide us the right to receive approximately 86.5% of any residual returns in Atairos, in either case on a cumulative basis.

We have concluded that Atairos is a VIE, that we do not have the power to direct the activities that most significantly impact the economic performance of Atairos as we have no voting rights and only certain consent rights, and that we are not a related party with our former CFO or the management companies. We therefore do not consolidate Atairos and account for our investment as an equity method investment. There are no other liquidity arrangements, guarantees or other financial commitments between Comcast and Atairos, and therefore our maximum risk of financial loss is our investment balance and remaining unfunded capital commitment.

In 2017 and 2016, we made cash capital contributions totaling $994 million and $1.2 billion, respectively, to Atairos. Atairos follows investment company accounting and records its investments at their fair values each reporting period with the net gains or losses reflected in its statement of operations. We recognize our share of these gains and losses in equity in net income (losses) of investees, net. In 2017 and 2016, we recognized our share of Atairos income of $281 million and Atairos losses of $38 million, respectively.

In July 2017, we sold a business to a company owned by Atairos and received as consideration an investment in that company, which we account for as an equity method investment. In connection with the sale of the business, we recognized a pretax gain of $105 million in other operating gains in 2017.

Hulu

In 2017, 2016 and 2015, we made cash capital contributions totaling $300 million, $50 million and $123 million, respectively, to Hulu. In 2017, 2016 and 2015, we recognized our proportionate share of Hulu’s losses of $276 million, $168 million and $106 million, respectively.

In August 2016, Time Warner Inc. acquired a 10% interest in Hulu, LLC, which diluted our interest in Hulu from 33% to 30%. For a period not to exceed 3 years, Time Warner may put its shares to Hulu or Hulu may call Time Warner’s shares under certain limited circumstances arising from regulatory review. Given the contingent nature of the put and call options, we recorded a deferred gain of $159 million and a corresponding increase to our investment in Hulu as a result of the dilution. The deferred gain will be recognized in other income (expense), net if and when the options expire unexercised.

The Weather Channel

In January 2016, following a legal restructuring at The Weather Channel, we and the other investors sold the entity holding The Weather Channel’s product and technology businesses to IBM. Following the close of the transaction, we continue to hold an investment in The Weather Channel cable network through a new holding company. As a result of the sale of our investment, we recognized a pretax gain of $108 million in other income (expense), net.

In June and December 2015, The Weather Channel recorded impairment charges related to goodwill. In 2015, we recorded expenses of $333 million that represented NBCUniversal’s proportionate share of these impairment charges in equity in net income (losses) of investees, net.

Cost Method

We use the cost method to account for investments not accounted for under the fair value method or the equity method.

AirTouch

We hold two series of preferred stock of Verizon Americas, Inc., formerly known as AirTouch Communications, Inc., a subsidiary of Verizon Communications Inc., which are redeemable in April 2020. As of both December 31, 2017 and 2016, the estimated fair value of the AirTouch preferred stock was $1.7 billion.

The dividend and redemption activity of the AirTouch preferred stock determines the dividend and redemption payments associated with substantially all of the preferred shares issued by one of our consolidated subsidiaries, which is a VIE. The subsidiary has three series of preferred stock outstanding with an aggregate redemption value of $1.75 billion. Substantially all of the AirTouch preferred stock is redeemable in April 2020 at a redemption value of $1.65 billion. As of both December 31, 2017 and 2016, the two series of redeemable subsidiary preferred shares were recorded at $1.6 billion, and those amounts are included in other noncurrent liabilities. As of both December 31, 2017 and 2016, the liability related to the redeemable subsidiary preferred shares had an aggregate estimated fair value of $1.7 billion. The estimated fair values of the AirTouch preferred stock and redeemable subsidiary preferred shares are based on Level 2 inputs that use pricing models whose inputs are derived primarily from or corroborated by observable market data through correlation or other means for substantially the full term of the financial instrument. The one series of nonredeemable subsidiary preferred shares was recorded at $100 million as of both December 31, 2017 and 2016, and those amounts are included in noncontrolling interests in our consolidated balance sheet. The carrying amount of the nonredeemable subsidiary preferred shares approximates its fair value.

BuzzFeed and Vox Media

In September 2015, NBCUniversal acquired an interest in BuzzFeed, Inc. and made an additional investment in Vox Media, Inc. for $200 million each in cash. In November 2016, NBCUniversal made an additional investment of $200 million in Buzzfeed.

Impairment Testing of Investments

We review our investment portfolio each reporting period to determine whether there are identified events or circumstances that would indicate there is a decline in the fair value that would be considered other than temporary. For our nonpublic investments, if there are no identified events or circumstances that would have a significant adverse effect on the fair value of the investment, then the fair value is not estimated. If an investment is deemed to have experienced an other-than-temporary decline below its cost basis, we reduce the carrying amount of the investment to its quoted or estimated fair value, as applicable, and establish a new cost basis for the investment. For our AFS securities and our cost method investments, we record the impairment to investment income (loss), net. For our equity method investments, we record the impairment to other income (expense), net.

NBCUniversal Media LLC [Member]

Fair Value, Equity And Cost Method Investments [Line Items]

Investments

Note 7: Investments



December 31 (in millions)	2017		2016
Fair Value Method:
Snap	$	430	$	—
Other	—		6
	430		6
Equity Method:
Hulu	249		225
Other	441		336
	690		561
Cost Method:
BuzzFeed	400		400
Other	296		296
	696		696
Total investments	$	1,816	$	1,263

Fair Value Method

Snap

In March 2017, Comcast acquired an interest in Snap Inc. as part of its initial public offering. On March 31, 2017, Comcast contributed its investment in Snap to us as an equity contribution of $662 million, which was recorded in our consolidated statement of equity based on the fair value of the investment as of March 31, 2017. We have classified our investment as an available-for-sale security. Snap is a camera company whose primary product is Snapchat, a camera app that was created to help people communicate through short videos and images.

Equity Method

Hulu

The Weather Channel

In June and December 2015, The Weather Channel recorded impairment charges related to goodwill. In 2015, we recorded expenses of $333 million that represented our proportionate share of these impairment charges in equity in net income (losses) of investees, net.

Summarized Financial Information

The tables below present the summarized combined financial information of our equity method investments.



December 31 (in millions)	2017		2016
Current assets	$	2,612	$	2,105
Noncurrent assets	$	3,690	$	2,724
Current liabilities	$	2,205	$	1,921
Noncurrent liabilities	$	3,969	$	2,853



Year ended December 31 (in millions)	2017			2016			2015
Revenue	$	4,234		$	4,285		$	3,944
Operating income (loss)	$	(465	)	$	(182	)	$	(1,609	)
Net income (loss)	$	(656	)	$	(313	)	$	(1,820	)

Cost Method

We use the cost method to account for investments not accounted for under the fair value method or the equity method.

In September 2015, we acquired an interest in BuzzFeed, Inc. and made an additional investment in Vox Media, Inc. for $200 million each in cash. In November 2016, we made an additional investment of $200 million in Buzzfeed.

Impairment Testing of Investments