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:

                               SEPTEMBER 30, 1997

                                       OR

(  )  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 0-6983

                              COMCAST CORPORATION
                            [GRAPHIC OMITTED - LOGO]


             (Exact name of registrant as specified in its charter)

          PENNSYLVANIA                                   23-1709202
--------------------------------------------------------------------------------
  (State or other jurisdiction of                    (I.R.S. Employer
   incorporation or organization)                   Identification No.)

                 1500 Market Street, Philadelphia, PA 19102-2148
--------------------------------------------------------------------------------
                    (Address of principal executive offices)
                                   (Zip Code)

Registrant's telephone number, including area code:  (215) 665-1700

                           --------------------------

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  requirements
for the past 90 days.

         Yes  __X__                                        No ___

                           --------------------------

As of  September  30,  1997,  there were  308,407,111  shares of Class A Special
Common Stock,  31,793,767 shares of Class A Common Stock and 8,786,250 shares of
Class B Common Stock outstanding.

<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997

                                TABLE OF CONTENTS


                                                                           Page
                                                                          Number

PART I.   FINANCIAL INFORMATION

          Item 1.   Financial Statements

                    Condensed Consolidated Balance
                    Sheet as of September 30, 1997 and December 31,
                    1996 (Unaudited)...........................................2

                    Condensed Consolidated Statement of
                    Operations and Accumulated Deficit for
                    the Nine and Three Months Ended September 30,
                    1997 and 1996 (Unaudited)..................................3

                    Condensed Consolidated Statement of Cash
                    Flows for the Nine Months Ended September 30,
                    1997 and 1996 (Unaudited)..................................4

                    Notes to Condensed Consolidated
                    Financial Statements (Unaudited)......................5 - 17

          Item 2.   Management's Discussion and Analysis
                    of Financial Condition and Results of
                    Operations...........................................18 - 31

PART II.  OTHER INFORMATION

          Item 1.   Legal Proceedings.........................................32

          Item 6.   Exhibits and Reports on Form 8-K..........................32

          SIGNATURE...........................................................33

                       -----------------------------------

This Quarterly  Report on Form 10-Q contains  forward  looking  statements  made
pursuant to the "safe harbor"  provisions of the Private  Securities  Litigation
Reform Act of 1995.  Readers are cautioned that such forward looking  statements
involve  risks and  uncertainties  which  could  significantly  affect  expected
results  in the  future  from  those  expressed  in  any  such  forward  looking
statements  made by, or on behalf,  of the Company.  Certain  factors that could
cause actual  results to differ  materially  include,  without  limitation,  the
effects of  legislative  and  regulatory  changes;  the  potential for increased
competition;  technological  changes; the need to generate substantial growth in
the subscriber base by successfully launching,  marketing and providing services
in  identified  markets;  pricing  pressures  which could affect  demand for the
Company's services; the Company's ability to expand its distribution; changes in
labor, programming, equipment and capital costs; the Company's continued ability
to  create  or  acquire  programming  and  products  that  customers  will  find
attractive;  future  acquisitions,   strategic  partnerships  and  divestitures;
general business and economic conditions;  and other risks detailed from time to
time in the Company's  periodic  reports filed with the  Securities and Exchange
Commission. 
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997

PART I.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

                      CONDENSED CONSOLIDATED BALANCE SHEET
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                 (Dollars in millions, except share data)
                                                                                       September 30,    December 31,
                                                                                           1997             1996
<S>                                                                                     <C>               <C>      
ASSETS
CURRENT ASSETS
   Cash and cash equivalents....................................................           $573.6            $331.3
   Short-term investments.......................................................            207.1             208.3
   Accounts receivable, less allowance for doubtful
     accounts of $101.7 and $97.1...............................................            405.6             439.3
   Inventories, net.............................................................            339.2             258.4
   Other current assets.........................................................            156.9             168.5
                                                                                        ---------         ---------
       Total current assets.....................................................          1,682.4           1,405.8
                                                                                        ---------         ---------
INVESTMENTS, principally in affiliates..........................................          1,246.8           1,177.7
                                                                                        ---------         ---------
PROPERTY AND EQUIPMENT..........................................................          4,088.8           3,600.1
   Accumulated depreciation.....................................................         (1,317.4)         (1,061.3)
                                                                                        ---------         ---------
   Property and equipment, net..................................................          2,771.4           2,538.8
                                                                                        ---------         ---------
DEFERRED CHARGES................................................................          9,041.5           8,578.8
   Accumulated amortization.....................................................         (1,952.2)         (1,612.5)
                                                                                        ---------         ---------
   Deferred charges, net........................................................          7,089.3           6,966.3
                                                                                        ---------         ---------
                                                                                        $12,789.9         $12,088.6
                                                                                        =========         =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
   Accounts payable and accrued expenses........................................         $1,115.6          $1,044.3
   Accrued interest.............................................................            167.8              91.1
   Current portion of long-term debt, including optional
     debt repayments of $53.6 and $70.0.........................................            162.4             229.5
                                                                                        ---------         ---------
       Total current liabilities................................................          1,445.8           1,364.9
                                                                                        ---------         ---------
LONG-TERM DEBT, less current portion............................................          6,699.5           7,102.7
                                                                                        ---------         ---------
DEFERRED INCOME TAXES...........................................................          2,117.2           2,140.5
                                                                                        ---------         ---------
MINORITY INTEREST AND OTHER.....................................................          1,018.6             859.3
                                                                                        ---------         ---------
COMMITMENTS AND CONTINGENCIES

COMMON EQUITY PUT OPTIONS.......................................................             31.4              69.6
                                                                                        ---------         ---------
STOCKHOLDERS' EQUITY
   Preferred stock - authorized, 20,000,000 shares
     5% series A convertible, no par value, issued, 6,370 at redemption value...             31.9              31.9
     5.25% series B mandatorily redeemable convertible, $1,000 par value,
       issued, 506,563 at redemption value......................................            506.6
   Class A special common stock, $1 par value - authorized,
     500,000,000 shares; issued, 308,407,111 and 283,281,675....................            308.4             283.3
   Class A common stock, $1 par value - authorized,
     200,000,000 shares; issued, 31,793,767 and 33,959,368 .....................             31.8              34.0
   Class B common stock, $1 par value - authorized,
     50,000,000 shares; issued, 8,786,250 ......................................              8.8               8.8
   Additional capital...........................................................          2,826.0           2,326.6
   Accumulated deficit..........................................................         (2,326.1)         (2,127.1)
   Unrealized gains on marketable securities....................................            103.4               0.1
   Cumulative translation adjustments...........................................            (13.4)             (6.0)
                                                                                        ---------         ---------
       Total stockholders' equity...............................................          1,477.4             551.6
                                                                                        ---------         ---------
                                                                                        $12,789.9         $12,088.6
                                                                                        =========         =========
</TABLE>

See notes to condensed consolidated financial statements.

                                        2
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
     CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                        (Amounts in millions, except per share data)
                                                                        Nine Months Ended         Three Months Ended
                                                                          September 30,               September 30,
                                                                        1997        1996          1997           1996
<S>                                                                  <C>          <C>             <C>          <C>   
REVENUES
   Service income.............................................       $2,081.5     $1,584.0        $713.6       $543.5
   Net sales from electronic retailing........................        1,438.0      1,286.9         490.6        431.1
                                                                    ---------    ---------     ---------    --------- 
                                                                      3,519.5      2,870.9       1,204.2        974.6
                                                                    ---------    ---------     ---------    --------- 
COSTS AND EXPENSES
   Operating..................................................          919.8        679.6         308.5        226.1
   Cost of goods sold from electronic retailing...............          867.2        774.7         297.2        262.3
   Selling, general and administrative........................          666.4        554.6         233.5        190.4
   Depreciation...............................................          341.7        219.7         120.2         77.0
   Amortization...............................................          362.0        271.3         121.1         89.7
                                                                    ---------    ---------     ---------    --------- 
                                                                      3,157.1      2,499.9       1,080.5        845.5
                                                                    ---------    ---------     ---------    --------- 

OPERATING INCOME..............................................          362.4        371.0         123.7        129.1

OTHER (INCOME) EXPENSE
   Interest expense...........................................          422.8        403.7         143.9        135.7
   Investment income..........................................         (133.1)       (63.7)        (44.5)       (16.2)
   Equity in net losses of affiliates.........................          212.1         89.2          85.9         28.9
   Gain from equity offering of affiliate.....................                       (40.6)
   Other......................................................           13.4         22.6           9.0         (0.3)
                                                                    ---------    ---------     ---------    --------- 
                                                                        515.2        411.2         194.3        148.1
                                                                    ---------    ---------     ---------    --------- 
LOSS BEFORE INCOME TAX EXPENSE, MINORITY
   INTEREST AND EXTRAORDINARY ITEMS...........................         (152.8)       (40.2)        (70.6)       (19.0)

INCOME TAX EXPENSE............................................           45.4         33.9           8.5          9.3
                                                                    ---------    ---------     ---------    --------- 

LOSS BEFORE MINORITY INTEREST AND
   EXTRAORDINARY ITEMS........................................         (198.2)       (74.1)        (79.1)       (28.3)

MINORITY INTEREST.............................................          (66.8)       (47.4)        (27.0)       (18.4)
                                                                    ---------    ---------     ---------    --------- 

LOSS BEFORE EXTRAORDINARY ITEMS...............................         (131.4)       (26.7)        (52.1)        (9.9)

EXTRAORDINARY ITEMS...........................................          (25.9)        (1.0)         (3.1)
                                                                    ---------    ---------     ---------    --------- 

NET LOSS......................................................         (157.3)       (27.7)        (55.2)        (9.9)

PREFERRED DIVIDENDS...........................................           (7.8)        (0.3)         (7.0)        (0.3)
                                                                    ---------    ---------     ---------    --------- 

NET LOSS FOR COMMON STOCKHOLDERS..............................        ($165.1)      ($28.0)       ($62.2)      ($10.2)
                                                                    =========    =========     =========    ========= 

ACCUMULATED DEFICIT
   Beginning of period .......................................      ($2,127.1)   ($1,914.3)    ($2,262.6)   ($2,030.6)
   Net loss...................................................         (157.3)       (27.7)        (55.2)        (9.9)
   Common dividends - $.070, $.070, $.0233 and $.0233
     per share................................................          (24.0)       (18.6)         (8.3)        (7.6)
   Retirement of common stock.................................          (17.7)      (128.4)                     (40.9)
                                                                    ---------    ---------     ---------    --------- 
   End of period..............................................      ($2,326.1)   ($2,089.0)    ($2,326.1)   ($2,089.0)
                                                                    =========    =========     =========    ========= 

LOSS FOR COMMON STOCKHOLDERS PER COMMON SHARE
   Loss before extraordinary items............................          ($.42)       ($.11)        ($.17)       ($.04)
   Extraordinary items........................................           (.08)                      (.01)
                                                                    ---------    ---------     ---------    --------- 
        Net loss..............................................          ($.50)       ($.11)        ($.18)       ($.04)
                                                                    =========    =========     =========    ========= 

WEIGHTED AVERAGE NUMBER OF COMMON SHARES
   OUTSTANDING DURING THE PERIOD..............................          333.2        236.2         348.9        233.3
                                                                    =========    =========     =========    ========= 
</TABLE>

See notes to condensed consolidated financial statements.

                                        3
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                             (Dollars in millions)
                                                                                             Nine Months Ended September 30,
                                                                                           1997             1996
<S>                                                                                    <C>                <C>    
OPERATING ACTIVITIES
   Net loss.....................................................................          ($157.3)           ($27.7)
   Adjustments to reconcile net loss to net cash provided
    by operating activities:
     Depreciation...............................................................            341.7             219.7
     Amortization...............................................................            362.0             271.3
     Non-cash interest expense, net.............................................             39.4              48.1
     Equity in net losses of affiliates.........................................            212.1              89.2
     Gains on long-term investments, net of losses..............................            (93.1)            (22.1)
     Gain from equity offering of affiliate.....................................                              (40.6)
     Minority interest..........................................................            (66.8)            (47.4)
     Extraordinary items........................................................             25.9               1.0
     Deferred income taxes and other............................................            (22.4)              4.3
                                                                                         --------          -------- 
                                                                                            641.5             495.8

     Decrease in accounts receivable, net.......................................             54.4              45.3
     Increase in inventories, net...............................................            (80.8)            (11.8)
     Decrease (increase) in other current assets................................              2.4              (2.7)
     Increase (decrease) in accounts payable and accrued expenses...............             47.9             (26.0)
     Increase in accrued interest...............................................             76.7              26.7
                                                                                         --------          -------- 

           Net cash provided by operating activities............................            742.1             527.3
                                                                                         --------          -------- 

FINANCING ACTIVITIES
   Proceeds from borrowings.....................................................          2,968.3             660.4
   Retirement and repayment of debt.............................................         (3,518.4)           (486.7)
   Issuance of preferred stock..................................................            500.0
   Issuances of common stock, net...............................................            499.5               1.5
   Repurchases of common stock, net.............................................            (33.6)           (171.2)
   Dividends....................................................................            (25.2)            (18.9)
   Deferred financing costs.....................................................            (43.8)             (3.2)
   Other........................................................................             (1.5)             (1.1)
                                                                                         --------          -------- 

           Net cash provided by (used in) financing activities..................            345.3             (19.2)
                                                                                         --------          -------- 

INVESTING ACTIVITIES
   Acquisitions, net of cash acquired...........................................           (136.1)            (58.0)
   Proceeds from sales of short-term investments, net...........................              2.4             270.5
   Investments, principally in affiliates.......................................           (180.3)           (447.6)
   Proceeds from sales of and distributions from investments, 
     principally in affiliates .................................................            169.1             111.3
   Proceeds from investee's repayment of loan...................................             25.2
   Capital expenditures.........................................................           (682.0)           (450.2)
   Additions to deferred charges................................................            (37.5)            (37.6)
   Other........................................................................             (5.9)             (9.4)
                                                                                         --------          -------- 

           Net cash used in investing activities................................           (845.1)           (621.0)
                                                                                         --------          -------- 

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS................................            242.3            (112.9)

CASH AND CASH EQUIVALENTS, beginning of period..................................            331.3             539.1
                                                                                         --------          -------- 

CASH AND CASH EQUIVALENTS, end of period........................................           $573.6            $426.2
                                                                                         ========          ======== 
</TABLE>

See notes to condensed consolidated financial statements.

                                        4
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

     Basis of Presentation
     The condensed  consolidated  balance sheet as of December 31, 1996 has been
     condensed from the audited  consolidated balance sheet as of that date. The
     condensed  consolidated  balance  sheet  as  of  September  30,  1997,  the
     condensed  consolidated statement of operations and accumulated deficit for
     the  nine  and  three  months  ended  September  30,  1997 and 1996 and the
     condensed  consolidated  statement  of cash flows for the nine months ended
     September 30, 1997 and 1996 have been prepared by Comcast  Corporation (the
     "Company") and have not been audited by the Company's independent auditors.
     In the opinion of management,  all  adjustments  (which include only normal
     recurring  adjustments) necessary to present fairly the financial position,
     results of  operations  and cash flows as of September 30, 1997 and for all
     periods presented have been made.

     Certain information and note disclosures normally included in the Company's
     annual financial  statements prepared in accordance with generally accepted
     accounting  principles  have been  condensed  or omitted.  These  condensed
     consolidated  financial  statements  should be read in conjunction with the
     financial  statements and notes thereto included in the Company's  December
     31, 1996 Annual Report on Form 10-K filed with the  Securities and Exchange
     Commission.  The results of operations for the periods ended  September 30,
     1997 are not necessarily indicative of operating results for the full year.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     New Accounting Pronouncements
     Effective  January 1, 1997, the Company adopted the provisions of Statement
     of  Financial  Accounting  Standards  ("SFAS")  No.  125,  "Accounting  for
     Transfers  and  Servicing  of  Financial  Assets  and   Extinguishments  of
     Liabilities," which was issued by the Financial  Accounting Standards Board
     ("FASB") in June 1996. Under this statement,  after a transfer of financial
     assets, an entity recognizes the financial and servicing assets it controls
     and the  liabilities it has incurred,  derecognizes  financial  assets when
     control   has  been   surrendered   and   derecognizes   liabilities   when
     extinguished.  Adoption of this statement did not have a significant impact
     on the Company's consolidated financial position or results of operations.

     In February 1997, the FASB issued SFAS No. 128,  "Earnings Per Share." This
     statement,   which  clarifies  and  supersedes  the  current  authoritative
     accounting  literature regarding the computation and disclosure of earnings
     per share,  is  effective  for  interim  and annual  periods  ending  after
     December  15, 1997 and may not be applied  earlier.  The  Company  does not
     expect  adoption of this statement to result in significant  changes to the
     Company's  calculation or presentation of loss for common  stockholders per
     common share.

     In June  1997,  the FASB  issued  SFAS No.  130,  "Reporting  Comprehensive
     Income."  This  statement,  which  establishes  standards for reporting and
     disclosure  of  comprehensive  income,  is effective for interim and annual
     periods  beginning after December 15, 1997,  although  earlier  adoption is
     permitted.  Reclassification  of financial  information for earlier periods
     presented for comparative  purposes is required under SFAS No. 130. As this
     statement   only   requires   additional   disclosures   in  the  Company's
     consolidated financial statements, its adoption will not have any impact on
     the Company's consolidated financial position or results of operations. The
     Company expects to adopt SFAS No. 130 effective January 1, 1998.

     In June 1997, the FASB issued SFAS No. 131,  "Disclosures about Segments of
     an Enterprise and Related  Information." This statement,  which establishes
     standards for the reporting of  information  about  operating  segments and
     requires the reporting of selected  information about operating segments in
     interim financial statements, is effective for fiscal years beginning after
     December   15,   1997,   although   earlier   application   is   permitted.
     Reclassification  of segment  information for earlier periods presented for
     comparative  purposes is required  under SFAS No. 131. The Company does not
     expect  adoption of this statement to result in significant  changes to its
     presentation of financial data by business segment.  The Company expects to
     adopt SFAS No. 131 effective January 1, 1998.

                                        5
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)

     Loss for Common Stockholders Per Common Share
     Loss for common  stockholders  per common share  amounts  were  computed by
     dividing net loss and loss before  extraordinary  items, after deduction of
     preferred stock dividends,  by the weighted average number of common shares
     outstanding  during  the  period.  For the  nine  and  three  months  ended
     September 30, 1997 and 1996, the Company's common stock equivalents have an
     antidilutive  effect on net loss per share  and,  therefore,  have not been
     used in  determining  the total  weighted  average  number of common shares
     outstanding.

     Reclassifications
     Certain  reclassifications  have  been  made to the  prior  year  condensed
     consolidated  financial statements to conform to those classifications used
     in 1997.

3.   ACQUISITIONS AND OTHER SIGNIFICANT EVENTS

     Cable TV Fund 14 A/B Venture
     In  October  1997,  the  Company  and  Jones   Intercable,   Inc.   ("Jones
     Intercable")  entered  into an agreement  whereby the  Company,  through an
     indirect  majority  owned  subsidiary,  will  acquire  Cable TV Fund 14 A/B
     Venture, a cable television system serving approximately 65,000 subscribers
     in and around Broward County,  Florida for $140 million in cash, subject to
     certain  adjustments.  The  acquisition  is  expected to be funded with the
     proceeds from borrowings under one of the Company's  subsidiary's  existing
     credit  facilities.  The  acquisition is subject to a number of conditions,
     including the receipt of necessary regulatory approvals and the approval of
     the limited  partners of Cable TV Fund 14 A/B Venture.  The  acquisition is
     expected to close in the first quarter of 1998.

     Microsoft Investment
     On  June  30,  1997  (the  "Issuance  Date"),  the  Company  and  Microsoft
     Corporation   ("Microsoft")  completed  a  Stock  Purchase  Agreement  (the
     "Agreement")  under which  Microsoft  purchased and the Company issued 24.6
     million  shares of the Company's  Class A Special  Common Stock,  par value
     $1.00 per share (the  "Class A Special  Stock"),  at $20.29 per share,  for
     $500.0  million and 500,000  shares of the  Company's  newly  issued  5.25%
     Series B Mandatorily  Redeemable  Convertible  Preferred  Stock,  par value
     $1,000 per share (the "Series B Preferred Stock"), for $500.0 million.

     The  Series B  Preferred  Stock has a 5.25%  pay-in-kind  annual  dividend.
     Dividends will be paid quarterly  through the issuance of additional shares
     of  Series  B  Preferred  Stock  (the  "Additional  Shares")  and  will  be
     cumulative  from the Issuance Date (except that dividends on the Additional
     Shares will accrue from the date such  Additional  Shares are issued).  The
     Series B Preferred Stock,  including the Additional Shares, is convertible,
     at the option of  Microsoft,  into 21.2  million  shares of Class A Special
     Stock, subject to adjustment in certain limited circumstances, which equals
     an initial conversion price of $23.54 per share,  increasing as a result of
     the  Additional  Shares to $33.91 per share on June 30, 2004.  The Series B
     Preferred  Stock is  mandatorily  redeemable  on June 30, 2017,  or, at the
     option  of the  Company  beginning  on June 30,  2004 or at the  option  of
     Microsoft  on June  30,  2004 or on June 30,  2012.  Upon  redemption,  the
     Company,  at its option, may redeem the Series B Preferred Stock with cash,
     Class A Special Stock or a combination  thereof.  As the Company  currently
     intends to redeem the Series B Preferred  Stock with Class A Special  Stock
     upon  redemption,  the Series B Preferred  Stock has been  classified  as a
     component of  stockholders'  equity as of September 30, 1997.  The Series B
     Preferred Stock is generally non-voting.

     Offerings of Subsidiary Debt
     In May 1997, Comcast Cellular Holdings, Inc. ("Comcast Cellular"), a wholly
     owned  subsidiary  of the  Company,  completed  the  sale of  $1.0  billion
     principal  amount of 9 1/2% Senior  Notes due 2007 (the  "Cellular  Notes")
     through a private offering with registration rights. The Cellular Notes are
     obligations of Comcast  Cellular and are not obligations of, nor guaranteed
     by, the Company.  Comcast  Cellular used the net proceeds from the offering
     to repay  existing  borrowings  by its  subsidiaries,  including its senior
     participating   redeemable   zero   coupon   notes.   Collectively,   these
     transactions are referred to herein as the "Cellular Refinancing."

     In May 1997, Comcast Cable Communications, Inc. ("Comcast Cable"), a wholly
     owned  subsidiary  of the  Company,  completed  the  sale of  $1.7  billion
     principal amount of notes (the "Cable Notes") through a private

                                        6
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)

     offering  with  registration  rights.  The Cable  Notes were issued in four
     tranches:  $300.0 million principal amount of 8 1/8% Notes due 2004, $600.0
     million principal amount of 8 3/8% Notes due 2007, $550.0 million principal
     amount of 8 7/8% Notes due 2017 and $250.0  million  principal  amount of 8
     1/2% Notes due 2027.  The Notes due 2027 are subject to  repurchase  at the
     option of the holder in 2009.  The Cable Notes are  obligations  of Comcast
     Cable and are not obligations  of, nor guaranteed by, the Company.  Comcast
     Cable used substantially all of the net proceeds from the offering to repay
     existing borrowings by its subsidiaries.  Collectively,  these transactions
     are referred to herein as the "Cable Refinancing."

     In October 1997, the Company  completed an exchange of 100% of the Cellular
     Notes and the Cable Notes for new notes (having the terms described  above)
     which were registered under the Securities Act of 1933, as amended.

     E! Entertainment
     On March 31, 1997, the Company,  through Comcast Entertainment Holdings LLC
     (the  "LLC"),  which is owned  50.1% by the  Company  and 49.9% by The Walt
     Disney Company  ("Disney"),  purchased a 58.4% interest in E! Entertainment
     Television, Inc. ("E! Entertainment"), an entertainment programming service
     distributed  to more than 42 million  subscribers,  from Time Warner,  Inc.
     ("Time  Warner")  for  $321.9  million  (the  "E!  Acquisition").   The  E!
     Acquisition was funded by cash  contributions to the LLC by the Company and
     Disney of $132.8 million and $189.1  million,  respectively.  In connection
     with the E! Acquisition,  the Company  contributed its 10.4% interest in E!
     Entertainment  to the LLC.  Following  these  transactions,  the LLC owns a
     68.8% interest in E!  Entertainment.  To fund the cash  contribution to the
     LLC, the Company borrowed $132.8 million from Disney in the form of two 10-
     year, 7% notes (the "Disney Notes").

     The Company  accounted for the E! Acquisition under the purchase method and
     E!  Entertainment  was  consolidated  with the Company  effective March 31,
     1997.  The  allocation  of the  purchase  price  relating to the assets and
     liabilities of E! Entertainment is preliminary pending a final appraisal.

     After  September 1998,  Disney,  in certain  circumstances,  is entitled to
     request that the LLC purchase  Disney's  entire  interest in the LLC at its
     then fair market value (as determined by an appraisal process).  If the LLC
     elects not to  purchase  Disney's  interest,  Disney has the right,  at its
     option,  to purchase either the Company's entire interest in the LLC or all
     of the shares of stock of E! Entertainment held by the LLC, in each case at
     fair market  value.  In the event that  Disney  exercises  its  rights,  as
     described  above, a portion or all of the Disney Notes may be replaced with
     a three year note due to Disney.

     Scripps Cable
     In November  1996,  the Company  acquired the cable  television  operations
     ("Scripps Cable") of The E.W. Scripps Company ("E.W.  Scripps") in exchange
     for 93.048 million shares of Class A Special Stock valued at $1.552 billion
     (the  "Scripps  Acquisition").   The  Company  accounted  for  the  Scripps
     Acquisition  under the purchase  method and Scripps Cable was  consolidated
     with the Company  effective  November 1, 1996. During the second quarter of
     1997, the Company recorded the final purchase price allocation  relating to
     the Scripps Acquisition.  The terms of the Scripps Acquisition provide for,
     among other things, the indemnification of the Company by E. W. Scripps for
     certain liabilities,  including tax liabilities,  relating to Scripps Cable
     prior to the acquisition date.

     Comcast-Spectacor
     In July 1996, the Company  completed its  acquisition  (the "Sports Venture
     Acquisition")  of  a  66%  interest  in  the  Philadelphia  Flyers  Limited
     Partnership,  a Pennsylvania  limited partnership  ("PFLP"),  the assets of
     which,  after giving effect to the Sports Venture  Acquisition,  consist of
     (i)  the  National  Basketball  Association  ("NBA")  franchise  to own and
     operate the  Philadelphia  76ers  basketball  team and related  assets (the
     "Sixers"),  (ii) the National  Hockey League  ("NHL")  franchise to own and
     operate the Philadelphia  Flyers hockey team and related assets,  and (iii)
     two adjacent arenas,  leasehold interests in and development rights related
     to the land  underlying  the  arenas  and other  adjacent  parcels  of land
     located  in  Philadelphia,   Pennsylvania  (collectively,   the  "Arenas").
     Concurrent with the completion of the Sports Venture Acquisition,  PFLP was
     renamed Comcast Spectacor, L.P. ("Comcast-Spectacor").

                                        7
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)

     The Sports Venture  Acquisition  was completed in two steps. In April 1996,
     the Company  purchased  the Sixers for $125.0  million in cash plus assumed
     net  liabilities  of  approximately  $11.0  million  through a  partnership
     controlled by the Company. To complete the Sports Venture  Acquisition,  in
     July 1996, the Company  contributed  its interest in the Sixers,  exchanged
     approximately 3.5 million shares of the Company's Class A Special Stock and
     6,370  shares  of the  Company's  newly  issued  5%  Series  A  Convertible
     Preferred Stock and paid $15.0 million in cash for its current  interest in
     Comcast-Spectacor. The remaining 34% interest in Comcast-Spectacor is owned
     by a group,  including the former  majority owner of PFLP, who also manages
     Comcast-Spectacor.  In  connection  with the  Sports  Venture  Acquisition,
     Comcast-Spectacor  assumed  the  outstanding  liabilities  relating  to the
     Sixers and the Arenas,  including a mortgage  obligation of $155.0 million.
     The Company accounts for its interest in Comcast-Spectacor under the equity
     method (see Note 4).

     Unaudited Pro Forma Information
     The  following  unaudited pro forma  information  for the nine months ended
     September  30,  1996  has  been  presented  as if the  Scripps  Acquisition
     occurred on January 1, 1996. This unaudited pro forma  information is based
     on historical  results of operations,  adjusted for acquisition costs, and,
     in the opinion of  management,  is not  necessarily  indicative of what the
     results  would  have been had the  Company  operated  Scripps  Cable  since
     January 1, 1996 (dollars in millions, except per common share data).

<TABLE>
<CAPTION>
                                                                                Nine Months Ended
                                                                                September 30, 1996
<S>                                                                               <C>     
              Revenues.....................................................       $3,097.0
              Loss before extraordinary items..............................          (66.9)
              Net loss for common stockholders.............................          (68.2)
              Net loss for common stockholders per common share............           (.21)
</TABLE>

4.   INVESTMENTS, PRINCIPALLY IN AFFILIATES
<TABLE>
<CAPTION>
                                                                              September 30,    December 31,
                                                                                  1997             1996
                                                                                   (Dollars in millions)
<S>                                                                              <C>               <C>   
           Equity method..........................................               $918.9            $966.1
           Fair value method......................................                289.1             165.5
           Cost method............................................                 38.8              46.1
                                                                               --------          --------
                                                                               $1,246.8          $1,177.7
                                                                               ========          ========
</TABLE>

                                        8
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)

     Equity Method
     The Company records its proportionate interests in the net income (loss) of
     substantially  all of its  investees,  other  than  the UK  Investees  (see
     below),  three months in arrears. The Company's recorded investments exceed
     its proportionate  interests in the book value of the investees' net assets
     by $193.4  million  as of  September  30,  1997  (primarily  related to the
     investments in Comcast-Spectacor  and Sprint PCS (see below)).  Such excess
     is being amortized to equity in net income or loss, primarily over a period
     of  twenty  years,  which is  consistent  with the  estimated  lives of the
     underlying assets. The original cost of investments accounted for under the
     equity method totaled $1.445 billion and $1.271 billion as of September 30,
     1997 and December 31, 1996, respectively.  Summarized financial information
     for the Company's  equity method  investees is presented  below (dollars in
     millions).
<TABLE>
<CAPTION>
                                                                     Sprint                  UK
                                                                       PCS       TCGI     Investees    Other    Combined
<S>                                                                 <C>        <C>          <C>      <C>       <C>    
Nine Months Ended September 30, 1997:

   Combined Results of Operations
     Revenues, net............................................        $39.0     $300.0     $143.3     $672.1   $1,154.4
     Operating, selling, general and
       administrative expenses................................        588.2      278.9      125.4      708.4    1,700.9
     Depreciation and amortization............................        110.1       93.4       52.5       81.7      337.7
     Operating loss...........................................       (659.3)     (72.3)     (34.6)    (118.0)    (884.2)
     Net loss (a).............................................       (730.2)    (139.1)     (66.2)    (159.7)  (1,095.2)

   Company's Equity in Net Loss
     Equity in current period net loss (b)....................      ($109.5)    ($22.1)    ($25.1)    ($49.0)   ($205.7)
     Amortization expense.....................................         (0.8)      (0.3)      (0.4)      (4.9)      (6.4)
                                                                    -------    -------    -------    -------   --------
       Total equity in net loss...............................      ($110.3)    ($22.4)    ($25.5)    ($53.9)   ($212.1)
                                                                    =======    =======    =======    =======   ======== 

Three Months Ended September 30, 1997:

   Combined Results of Operations
     Revenues, net............................................        $25.4     $115.8      $50.4     $229.8     $421.4
     Operating, selling, general and
       administrative expenses................................        236.7      107.0       43.2      255.4      642.3
     Depreciation and amortization............................         66.3       37.2       16.5       27.6      147.6
     Operating loss...........................................       (277.6)     (28.4)      (9.3)     (53.2)    (368.5)
     Net loss (a).............................................       (331.4)     (51.4)     (21.4)     (70.1)    (474.3)

   Company's Equity in Net Loss
     Equity in current period net loss........................       ($49.7)     ($7.9)     ($8.4)    ($17.7)    ($83.7)
     Amortization (expense) income............................         (0.7)       0.1       (0.1)      (1.5)      (2.2)
                                                                    -------    -------    -------    -------   --------
       Total equity in net loss...............................       ($50.4)     ($7.8)     ($8.5)    ($19.2)    ($85.9)
                                                                    =======    =======    =======    =======   ======== 


Combined Financial Position

As of September 30, 1997:
     Current assets...........................................       $335.7     $572.2      $40.9     $320.3   $1,269.1
     Noncurrent assets........................................      5,050.8    1,588.0      697.3    1,197.7    8,533.8
     Current liabilities......................................        300.0      260.9       75.1      825.4    1,461.4
     Noncurrent liabilities...................................      3,003.9    1,095.1      521.2      557.2    5,177.4
<FN>
------------
(a)  See footnote (1) on page 10.
(b)  See footnote (2) on page 10.
</FN>
</TABLE>

                                        9
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                     Sprint                  UK
                                                                       PCS     TCGI (3)   Investees    Other    Combined
<S>                                                                <C>         <C>        <C>        <C>        <C>   
Nine Months Ended September 30, 1996:

   Combined Results of Operations
     Revenues, net............................................     $            $120.1     $113.7     $390.8     $624.6
     Operating, selling, general and
       administrative expenses................................        122.0      111.3      104.4      393.3      731.0
     Depreciation and amortization............................          0.7       32.1       41.6       46.6      121.0
     Operating loss...........................................       (122.7)     (23.3)     (32.3)     (49.1)    (227.4)
     Net loss (1).............................................       (243.5)     (51.1)     (52.9)     (68.8)    (416.3)

   Company's Equity in Net Loss
     Equity in current period net loss........................       ($36.5)     ($9.7)    ($21.3)    ($18.3)    ($85.8)
     Amortization income (expense)............................          0.6       (0.8)                 (3.2)      (3.4)
                                                                    -------    -------    -------    -------   --------
       Total equity in net loss...............................       ($35.9)    ($10.5)    ($21.3)    ($21.5)    ($89.2)
                                                                    =======    =======    =======    =======   ======== 

Three Months Ended September 30, 1996:

   Combined Results of Operations
     Revenues, net............................................     $           $            $36.6     $142.2     $178.8
     Operating, selling, general and
       administrative expenses................................         46.5                  33.3      147.9      227.7
     Depreciation and amortization............................          0.4                  13.4       15.8       29.6
     Operating loss...........................................        (46.9)                (10.1)     (21.5)     (78.5)
     Net loss (1).............................................        (90.8)                (16.7)     (29.0)    (136.5)

   Company's Equity in Net Loss
     Equity in current period net loss........................       ($13.6)                ($6.5)     ($7.6)    ($27.7)
     Amortization expense.....................................                                          (1.2)      (1.2)
                                                                    -------    -------    -------    -------   --------
       Total equity in net loss...............................       ($13.6)   $            ($6.5)     ($8.8)    ($28.9)
                                                                    =======    =======    =======    =======   ======== 
<FN>
     --------
     (1) Net  loss  also  represents  loss  from  continuing  operations  before
         extraordinary  items and  cumulative  effect of changes  in  accounting
         principle.
     (2) As a  result  of the E!  Acquisition,  the  Company  recorded  a charge
         representing  the  cumulative  amount that would have been recorded had
         the Company accounted for its investment in E! Entertainment  under the
         equity  method since the date of initial  investment  (the  "Cumulative
         Charge"). Since the Company's proportionate share of E! Entertainment's
         cumulative losses was in excess of the Company's  historical cost basis
         in E!  Entertainment  and as  the  Company  was  under  no  contractual
         obligation  to fund the  losses  of E!  Entertainment,  the  Cumulative
         Charge was  limited  to the  Company's  historical  cost basis of $12.1
         million.  Such amount is included in equity in net losses of affiliates
         in the Company's  condensed  consolidated  statement of operations  and
         accumulated  deficit for the nine months ended September 30, 1997 as it
         is  not  significant  for  restatement  of  the  Company's  prior  year
         financial statements.
     (3) As the result of the TCGI IPO and Reorganization, which is described in
         more detail below,  in June 1996,  the Company began to account for its
         proportionate  interest in TCGI three months in arrears resulting in no
         equity in current  period net loss being  recorded for the three months
         ended September 30, 1996.
</FN>
</TABLE>

     Sprint  PCS.   The  Company,   Tele-Communications,   Inc.   ("TCI"),   Cox
     Communications, Inc. ("Cox") and Sprint Corporation ("Sprint," and together
     with the Company, TCI and Cox, the "Parents"),  and certain subsidiaries of
     the  Parents,  engage in the  wireless  communications  business  through a
     limited   partnership  known  as  "Sprint  Spectrum"  or  "Sprint  PCS,"  a
     development  stage  enterprise  through June 30, 1997. The Company made its
     initial  investment in 1994 and, as of September 30, 1997,  holds a general
     and  limited  partnership  interest  of 15% in Sprint  PCS.  The  Company's
     investment  in Sprint PCS is accounted for under the equity method based on
     the Company's general  partnership  interest and its  representation on the
     partnership's board of directors.

                                       10
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)

     TCGI.   Through  June  1996,  the  Company  held  investments  in  Teleport
     Communications  Group, Inc. ("TCGI"),  TCG Partners and certain local joint
     ventures (the "Teleport Joint Ventures")  managed by TCGI and TCG Partners.
     TCGI is one of the largest competitive  alternative access providers in the
     United States in terms of route miles.  The Company had a 20.0%  investment
     in TCGI and interests in the Teleport Joint Ventures  ranging from 12.4% to
     20.3%. In June 1996, TCGI sold approximately 27 million shares of its Class
     A Common Stock (the "TCGI Class A Stock"), for $16 per share, in an initial
     public  offering (the "TCGI IPO").  In connection  with the TCGI IPO, TCGI,
     the  Company  and  subsidiaries  of Cox,  TCI and  Continental  Cablevision
     ("Continental"  and collectively with Cox, TCI and the Company,  the "Cable
     Stockholders")  entered  into an  agreement  pursuant  to  which  TCGI  was
     reorganized (the "Reorganization").  The Reorganization consisted of, among
     other  things:  (i)  the  acquisition  by TCGI of TCG  Partners;  (ii)  the
     acquisition by TCGI of additional  interests in the Teleport Joint Ventures
     (including  100% of those  interests  held by the  Company);  and (iii) the
     contribution  to TCGI of  $269.0  million  aggregate  principal  amount  of
     indebtedness,  plus  accrued  interest  thereon,  owed by TCGI to the Cable
     Stockholders  (except that TCI retained a $26 million  subordinated note of
     TCGI), including $53.8 million principal amount and $4.1 million of accrued
     interest owed to the Company.  In connection with the  Reorganization,  the
     Company  received  25.6 million  shares of TCGI's Class B Common Stock (the
     "TCGI  Class B Stock").  Each share of TCGI  Class B Stock is  entitled  to
     voting  power  equivalent  to ten  shares  of TCGI  Class  A  Stock  and is
     convertible,  at the option of the  holder,  into one share of TCGI Class A
     Stock.  As a result of the TCGI IPO, the Company  recorded a $40.6  million
     increase  in its  proportionate  share of TCGI's  net assets as a gain from
     equity  offering of affiliate in its  condensed  consolidated  statement of
     operations and accumulated  deficit for the nine months ended September 30,
     1996.

     During the three  months ended March 31, 1997,  the Company  received  2.76
     million  shares  of TCGI  Class  A Stock  from  TCGI  in  exchange  for the
     Company's shares of an alternate access provider.  In May 1997, the Company
     sold  all of its  shares  of TCGI  Class  A Stock  for  $68.9  million  and
     recognized a $68.9 million  pre-tax  gain,  which is included in investment
     income  in  its  condensed   consolidated   statement  of  operations   and
     accumulated deficit for the nine months ended September 30, 1997.

     As of September 30, 1997, the Company owns TCGI Class B Stock  representing
     a 19.8% voting interest and a 15.5% equity interest.  The Company continues
     to account for its  interest in TCGI under the equity  method  based on its
     voting   interest   maintained   through  the  TCGI  Class  B  Stock,   its
     representation on TCGI's board of directors and its participation in a TCGI
     stockholder  agreement granting certain rights to a control group. Assuming
     conversion  of the TCGI Class B Stock held by the Company into TCGI Class A
     Stock,  the  Company's  investment in TCGI,  which had a carrying  value of
     $123.3  million  as of  September  30,  1997,  would  have a fair  value of
     approximately $1.239 billion,  based on the quoted market price of the TCGI
     Class A Stock as of October 31, 1997.

     UK Investees.  As of September 30, 1997,  Comcast UK Cable Partners Limited
     ("Comcast UK Cable"),  a  consolidated  subsidiary of the Company,  holds a
     27.5% interest in Birmingham Cable Corporation Limited and a 50.0% interest
     in Cable London PLC. In  addition,  Comcast UK Cable  historically  held an
     investment in Cambridge  Holding Company Limited  ("Cambridge  Cable").  In
     March 1996,  Comcast UK Cable  purchased  the 50.0%  interest in  Cambridge
     Cable  that it had not  previously  owned  for cash and  approximately  8.9
     million  of its  Class  A  Common  Shares  (the  "Cambridge  Acquisition").
     Following  the  Cambridge  Acquisition,  Comcast  UK Cable  owns  100.0% of
     Cambridge  Cable and  consolidated  the  financial  position and results of
     operations of Cambridge Cable effective March 31, 1996.

     Other. The Company's 10 other equity method investees  include  investments
     in wired  telecommunications  (including Garden State Cablevision,  L.P., a
     cable  communications  company serving 206,000  subscribers as of September
     30,  1997  in  the  State  of  New  Jersey),  wireless   telecommunications
     (including   Primestar  -  see  below)  and  content  providers  (including
     Comcast-Spectacor  - see Note 3). The Company holds interests  representing
     less than 20% of the total outstanding ownership interest in certain of its
     other equity method investees.  The equity method of accounting is utilized
     for  these  investments  based  on the  type of  investment  (i.e.  general
     partnership interest), board representation, participation in a controlling
     investor group,  significant  shareholder  rights or a combination of these
     and  other   factors.   In  addition,   the   Company's   66%  interest  in
     Comcast-Spectacor  is  accounted  for under  the  equity  method  since the
     Company  does not have  control over  Comcast-Spectacor's  operations.  The
     Company

                                       11
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)

     does not consider these other equity method  investments to be individually
     significant to its consolidated  financial position,  results of operations
     or liquidity.

     Roll-up of Primestar's Operations. In June 1997, the Company entered into a
     binding letter agreement (the "Roll-up  Agreement") with PRIMESTAR Partners
     L.P.  ("Primestar")  and the  affiliates  of each of the other  partners of
     Primestar,   including  TCI  Satellite  Entertainment,   Inc.  ("TSAT"),  a
     publicly-traded  company.  Primestar,  in which the  Company  holds a 10.4%
     general and limited  partnership  interest,  is principally  engaged in the
     business of acquiring,  originating and/or providing television programming
     services   delivered  by  satellite  through  a  network  of  distributors,
     including the Company,  throughout the United States. The Roll-up Agreement
     sets forth the principal  terms and  conditions  of a proposed  transaction
     (the "Roll-up  Transaction"),  through which the Company's direct broadcast
     satellite   ("DBS")   operations,   Primestar  and  the   Primestar-related
     distribution  businesses  of  the  other  partners  of  Primestar  will  be
     consolidated into a newly-formed publicly-traded company ("New Primestar").
     In connection with the Roll-up Transaction, TSAT will become a wholly owned
     subsidiary of New Primestar.  The Company provided DBS services,  through a
     distributorship  arrangement with Primestar,  to 169,000  subscribers as of
     September 30, 1997.

     New Primestar will acquire the Primestar partnership interests, subscribers
     and  related  assets,  as  applicable,   of  the  parties  to  the  Roll-up
     Transaction, in exchange for (i) cash, (ii) shares of Series A Common Stock
     of New  Primestar  and  (iii)  shares  of  Series  C  Common  Stock  of New
     Primestar,  in each case in an amount  determined  pursuant  to the Roll-up
     Agreement.  The  Company  will have the  right to  continue  to market  and
     support  the  Primestar  programming  services  on an  agency  basis  after
     consummation  of the  Roll-up  Transaction;  however,  the  terms  of  such
     arrangement  have not yet been  determined.  Under the terms of the Roll-up
     Agreement, upon closing of the Roll-up Transaction, the Company is expected
     to receive  approximately  $75 million in cash and to own approximately 10%
     of New Primestar  common  equity,  both subject to adjustment  based on the
     number of subscribers, inventory amounts and other factors. As of September
     30, 1997, assets of the Company's DBS operations totaled $149.4 million.

     In June 1997, Primestar entered into an agreement with The News Corporation
     Limited, MCI  Telecommunications  Corporation and American Sky Broadcasting
     LLC  ("ASkyB"),   pursuant  to  which  New  Primestar  (or,  under  certain
     circumstances,  Primestar)  will  acquire  certain  assets  relating  to  a
     high-power,  DBS business.  In exchange for such assets, ASkyB will receive
     non-voting  securities  of New  Primestar  that  will be  convertible  into
     non-voting common stock of New Primestar and, accordingly,  will reduce the
     Company's  common equity interest in New Primestar to approximately 7% on a
     fully diluted basis, subject to adjustment.

     These  transactions  are not  conditioned  on  each  other  and  may  close
     independently.  They are  expected to close in 1998,  subject to receipt of
     all necessary governmental and regulatory approvals, including the approval
     of the Federal  Communications  Commission.  There can be no assurance that
     such approvals will be obtained.

     Fair Value Method
     The Company  holds  unrestricted  equity  investments  in certain  publicly
     traded  companies,  with an  historical  cost of $130.0  million and $212.7
     million as of September 30, 1997 and December 31, 1996,  respectively.  The
     Company has recorded these  investments,  which are classified as available
     for sale,  at their  estimated  fair  values of $289.1  million  and $212.9
     million as of September 30, 1997 and December 31, 1996,  respectively.  The
     unrealized pre-tax gains as of September 30, 1997 (which includes the @Home
     Unrestricted  Shares - see below) and December  31, 1996 of $159.1  million
     and  $0.2  million,  respectively,  have  been  reported  in the  Company's
     condensed  consolidated  balance  sheet  as a  component  of  stockholders'
     equity,  net of related  deferred  income tax expense of $55.7  million and
     $0.1 million, respectively.

     @Home.  In July 1997,  At Home  Corporation  ("@Home"),  an investee of the
     Company  previously  accounted  for under the equity  method,  completed an
     initial  public  offering of its Series A Common  Stock (the "@Home  IPO").
     @Home provides Internet services to customers and businesses over the cable
     television  infrastructure  in a limited  number  of  cities in the  United
     States. Effective July 1, 1997, due to the dilution of the Company's equity
     and voting  interests  and other  factors  subsequent to the @Home IPO, the
     Company has discontinued the equity method of accounting for its investment
     in  @Home.  As of  September  30,  1997,  the  Company  holds  8.0  million
     contractually

                                       12
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)

     restricted  shares (the "Restricted  Shares") and 6.6 million  unrestricted
     shares  (the  "Unrestricted  Shares") of @Home  Series A Common  Stock (the
     "@Home Series A Stock"),  representing a 12.4% and a 5.7% equity and voting
     interest,  respectively.  The Company has recorded the Restricted Shares at
     their  historical cost of $1.1 million and the Unrestricted  Shares,  which
     are classified as available for sale, at their  estimated fair market value
     of $151.5  million,  based on the quoted market price of the @Home Series A
     Stock as of September 30, 1997. The unrealized pre-tax gain as of September
     30, 1997 of $150.6  million has been  reported in the  Company's  condensed
     consolidated  balance sheet as a component of stockholders'  equity, net of
     related deferred income tax expense of $52.7 million.

     Nextel. At December 31, 1996, the Company held 3.3 million shares of Nextel
     Communications,  Inc.  ("Nextel")  common  stock and  options to acquire an
     additional  25.0 million shares of Nextel common stock at $16 per share. As
     of December 31, 1996, these options,  which had an historical cost of $20.0
     million, were included in investments in publicly traded companies at their
     fair value of $32.6  million.  In February  1997,  the  Company  sold these
     options to Nextel for $25.0  million and  recognized a pre-tax gain of $5.0
     million,  which is included in investment income in the Company's condensed
     consolidated  statement of operations and accumulated  deficit for the nine
     months ended  September  30, 1997.  In July 1997,  the Company sold its 3.3
     million  shares of Nextel  common stock for $73.4  million,  resulting in a
     pre-tax gain of $32.2  million,  which is included in investment  income in
     the  Company's   condensed   consolidated   statement  of  operations   and
     accumulated deficit for the nine and three months ended September 30, 1997.

     In February  1996,  in  connection  with certain  preemptive  rights of the
     Company  under  previously  existing  agreements  with Nextel,  the Company
     purchased  8.16 million  shares of Nextel common stock at $12.25 per share,
     for $99.9  million.  During the nine and three months ended  September  30,
     1996,  the  Company  sold  5.6  million  shares  and  1.2  million  shares,
     respectively,  of Nextel common stock for $105.4 million and $19.9 million,
     respectively,  and  recognized  pre-tax  gains  of $35.4  million  and $5.8
     million,  respectively,  which are  included  in  investment  income in its
     condensed consolidated statement of operations and accumulated deficit.

     Time  Warner/TBS.  The Company  received 1.36 million shares of Time Warner
     common stock (the "Time Warner Stock") in exchange (the "Exchange") for all
     of the shares of Turner  Broadcasting  System, Inc. ("TBS") stock (the "TBS
     Stock")  held by the  Company as a result of the merger of Time  Warner and
     TBS in October 1996. As a result of the Exchange,  the Company recognized a
     pre-tax gain of $47.3 million in the fourth  quarter of 1996,  representing
     the difference between the Company's historical cost basis in the TBS Stock
     of $8.9  million  and the new basis for the  Company's  investment  in Time
     Warner Stock of $56.2 million,  which was based on the closing price of the
     Time Warner Stock on the merger date of $41.375 per share. In December 1996
     and January 1997,  the Company sold 92,500 shares and 1.27 million  shares,
     respectively,  of the Time Warner Stock,  representing the Company's entire
     interest in Time Warner, for $3.7 million and $48.6 million,  respectively.
     In connection with the January 1997 sales, the Company recognized a pre-tax
     loss of $3.8  million,  which  is  included  in  investment  income  in its
     condensed  consolidated statement of operations and accumulated deficit for
     the nine months ended September 30, 1997. As of December 31, 1996, the 1.27
     million  shares of Time Warner Stock held by the Company  were  recorded at
     their  fair  value  of  $47.4  million  and  were  included  in  short-term
     investments in the Company's condensed consolidated balance sheet.

                                       13
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)

5.   LONG-TERM DEBT

     The Cable Refinancing and the Cellular Refinancing had a significant impact
     on the maturities of the Company's long-term debt.  Maturities of long-term
     debt  outstanding  as of  September  30, 1997 and December 31, 1996 through
     2001 are as follows (dollars in millions):
<TABLE>
<CAPTION>
                                                                        As of                   As of
                                                                 September 30, 1997       December 31, 1996

<S>                                                                  <C>                   <C>   
         1997.................................................        $  71.9 (1)              $229.5
         1998.................................................          110.0                   671.5
         1999.................................................          206.3                   462.5
         2000.................................................          305.3                   668.1
         2001.................................................          578.0                 1,282.4
<FN>
      ---------------
     (1) Represents  maturities of long-term debt for the remaining three months
         of 1997,  which includes $43.6 million of debt redeemed in October 1997
         (see below) and a $10.0 million optional debt repayment made in October
         1997.
</FN>
</TABLE>

     As of September  30, 1997 and December 31, 1996,  the  Company's  effective
     weighted  average interest rate on its long-term debt outstanding was 8.26%
     and 7.68%, respectively.

     Debt Repayments
     In June 1997, the Company  redeemed all of its outstanding 10% Subordinated
     Debentures, due 2003 (the "10% Debentures").  An aggregate principal amount
     of $139.3 million of the 10% Debentures was redeemed at a redemption  price
     of 100% of the principal  amount  thereof,  together with accrued  interest
     thereon.  On the date of  redemption,  the 10%  Debentures  had an accreted
     value of $127.7 million.

     In July 1997, the Company made optional debt repayments  aggregating $527.0
     with existing cash, cash equivalents and short-term investments.

     In October 1997, the Company completed the redemption of its $250.0 million
     principal  amount  3  3/8%  /  5  1/2%  step  up  convertible  subordinated
     debentures  due 2005 (the "Step Up  Debentures").  The  Company  issued 8.4
     million  shares of its  Class A Special  Stock  upon  conversion  of $206.4
     million  principal  amount  of  Step  Up  Debentures  while  $43.6  million
     principal  amount  of  Step  Up  Debentures  was  redeemed  for  cash  at a
     redemption price of 105.58% of the principal amount,  together with accrued
     interest thereon. Stockholders' equity will be increased by the full amount
     of Step Up Debentures  converted plus accrued  interest,  less  unamortized
     debt  acquisition  costs.  In connection with the redemption of the Step Up
     Debentures, the Company will expense unamortized debt acquisition costs and
     incur debt extinguishment costs of approximately $3.0 million, resulting in
     an extraordinary loss, net of tax, of approximately $1.9 million during the
     fourth quarter of 1997.

     In October 1997, a subsidiary of the Company refinanced one of its existing
     revolving  credit  facilities with the proceeds from borrowings under a new
     $400.0 million  credit  agreement  (the "New Bank  Facility")  with certain
     banks.  Initial  borrowings  under the New Bank Facility of $215.0  million
     were  used  principally  to  repay  existing  debt.  As  a  result  of  the
     refinancing, the Company will expense unamortized debt acquisition costs of
     approximately $5.2 million, resulting in an extraordinary loss, net of tax,
     of approximately $3.4 million during the fourth quarter of 1997.

     Extraordinary Items
     Extraordinary  items,  for the nine and three  months ended  September  30,
     1997,  of $25.9  million or $.08 per common  share and $3.1 million or $.01
     per common share consist of  unamortized  debt  acquisition  costs and debt
     extinguishment costs of $39.8 million and $4.7 million,  respectively,  net
     of the related tax benefit of $13.9 million and $1.6 million, respectively,
     incurred principally in connection with the Cable Refinancing, the Cellular

                                       14
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)

     Refinancing  and the redemption of the 10% Debentures in the second quarter
     of 1997 and the optional debt repayments made in the third quarter of 1997.

     Lines of Credit
     As of October  31,  1997,  certain  subsidiaries  of the Company had unused
     lines of credit of $1.060 billion.  The  availability and use of the unused
     lines  of  credit  is  restricted  by the  covenants  of the  related  debt
     agreements and to subsidiary general purposes and dividend declaration. The
     Company  continually  evaluates  its debt  structure  with the intention of
     reducing its debt service requirements when desirable.

     Interest Rate Risk Management
     The following table summarizes the terms of the Company's existing interest
     rate exchange  agreements  ("Swaps),  interest rate cap agreements ("Caps")
     and interest rate collar  agreements  ("Collars")  as of September 30, 1997
     and December 31, 1996 (dollars in millions):
<TABLE>
<CAPTION>
                                        Notional                             Average         Estimated
                                         Amount          Maturities       Interest Rate     Fair Value
<S>                                     <C>            <C>              <C>               <C> 
     As of September 30, 1997
     Variable to Fixed Swaps               $600.0         1998-2000           5.56%           $6.6
     Caps                                   150.0           1998              6.67%
     Collars                                100.0         1997-1998       6.64% / 4.95%

     As of December 31, 1996
     Variable to Fixed Swaps             $1,080.0         1997-2000           5.85%           $7.4
     Caps                                   250.0           1997              8.55%
     Collars                                620.0         1997-1998       6.98% / 5.16%        0.1
</TABLE>

     The notional amounts of interest rate agreements, as presented in the above
     table,  are used to  measure  interest  to be paid or  received  and do not
     represent the amount of exposure to credit loss.  The estimated  fair value
     approximates  the  proceeds  (costs) to settle the  outstanding  contracts.
     While Swaps,  Caps and Collars  represent an integral part of the Company's
     interest rate risk management program, their incremental effect on interest
     expense for the nine and three months ended September 30, 1997 and 1996 was
     not significant.

6.   STOCKHOLDERS' EQUITY

     Concurrent  with the  announcement  of the Scripps  Acquisition  in October
     1995, the Company announced that its Board of Directors authorized a market
     repurchase program (the "Repurchase Program") pursuant to which the Company
     could purchase,  at such times and on such terms as it deemed  appropriate,
     up to $500.0 million of its outstanding common equity  securities,  subject
     to certain restrictions and market conditions.  Based on the trade date for
     stock repurchases, during the nine months ended September 30, 1997 and 1996
     and the three months ended September 30, 1996, the Company  repurchased 2.3
     million shares,  10.1 million shares and 3.6 million shares,  respectively,
     of its common stock for aggregate  consideration  of $36.2 million,  $173.4
     million  and  $56.8  million,  respectively,  pursuant  to  the  Repurchase
     Program. During the term of the Repurchase Program, which terminated on May
     13, 1997,  the Company  repurchased  a total of 13.5 million  shares of its
     common stock for aggregate consideration of $228.6 million.

     As part of the Repurchase  Program,  the Company sold put options on shares
     of its Class A Special Stock.  Put options on 4.0 million  shares,  sold by
     the Company  during 1996 and 1995 and  outstanding  at December  31,  1996,
     expired unexercised during the first quarter of 1997. Upon expiration,  the
     Company reclassified $69.6 million, the amount it would have been obligated
     to pay to repurchase such shares had the put options been  exercised,  from
     common equity put options to additional capital in the Company's  condensed
     consolidated balance sheet.

     As part of the  Repurchase  Program,  in April 1997,  the Company  sold put
     options on 2.0 million shares of its Class A Special Stock. The put options
     give the holder the right to require the Company to repurchase  such shares
     at 

                                       15
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                   (Unaudited)

     $15.68 per share on  specific  dates in April and May 1998.  The amount the
     Company would be obligated to pay to  repurchase  such shares upon exercise
     of the put options,  totaling $31.4  million,  has been  reclassified  from
     additional capital to common equity put options in the Company's  September
     30, 1997 condensed consolidated balance sheet.

7.   STATEMENT OF CASH FLOWS - SUPPLEMENTAL INFORMATION

     The Company  made cash  payments  for  interest of $303.4  million,  $329.0
     million,  $69.6 million and $99.2 million  during the nine and three months
     ended September 30, 1997 and 1996, respectively.

     The Company made cash  payments for income  taxes of $89.7  million,  $77.7
     million,  $14.7 million and $15.5 million  during the nine and three months
     ended September 30, 1997 and 1996, respectively.

8.   CONTINGENCIES

     The Company is subject to legal  proceedings  and claims which arise in the
     ordinary course of its business.  In the opinion of management,  the amount
     of ultimate  liability  with respect to these  actions will not  materially
     affect the  financial  position,  results of operations or liquidity of the
     Company.

                                       16
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONCLUDED
                                   (Unaudited)

9.   FINANCIAL DATA BY BUSINESS SEGMENT
     (Dollars in millions)
<TABLE>
<CAPTION>
                                                   Domestic
                                                     Cable        Electronic      Cellular
                                                Communications     Retailing   Communications    Other (1)         Total
<S>                                               <C>            <C>              <C>             <C>          <C>     
Nine Months Ended September 30, 1997
Revenues, net...............................        $1,537.0       $1,438.0         $335.4          $209.1       $3,519.5
Depreciation and amortization...............           462.7           79.2           94.4            67.4          703.7
Operating income (loss).....................           261.9          151.7           45.6           (96.8)         362.4
Interest expense............................           174.2           42.1           78.7           127.8          422.8
Capital expenditures........................           367.1           69.6           87.2           158.1          682.0
Equity in net losses of affiliates..........                                                         212.1          212.1

Three Months Ended September 30, 1997
Revenues, net...............................          $515.1         $490.6         $115.1           $83.4       $1,204.2
Depreciation and amortization...............           155.9           27.6           32.9            24.9          241.3
Operating income (loss).....................            92.0           48.7           18.5           (35.5)         123.7
Interest expense............................            54.3           14.2           26.6            48.8          143.9
Capital expenditures........................           115.6           28.5           29.3            61.5          234.9
Equity in net losses of affiliates..........                                                          85.9           85.9

As of September 30, 1997
Assets......................................        $6,043.6       $2,194.0       $1,456.6        $3,095.7      $12,789.9
Long-term debt, less current portion........         2,574.8          787.5        1,139.6         2,197.6        6,699.5

Nine Months Ended September 30, 1996
Revenues, net...............................        $1,170.9       $1,286.9         $317.1           $96.0       $2,870.9
Depreciation and amortization...............           289.3           78.9           84.8            38.0          491.0
Operating income (loss).....................           286.0          129.7           34.0           (78.7)         371.0
Interest expense............................           168.1           50.5           68.4           116.7          403.7
Capital expenditures........................           207.3           38.9           69.0           135.0          450.2
Equity in net losses (income) of affiliates.             0.1           (0.1)                          89.2           89.2

Three Months Ended September 30, 1996
Revenues, net...............................          $392.6         $431.1         $110.0           $40.9         $974.6
Depreciation and amortization...............            96.7           27.0           28.0            15.0          166.7
Operating income (loss).....................            95.4           42.2           19.7           (28.2)         129.1
Interest expense............................            57.3           15.4           24.4            38.6          135.7
Capital expenditures........................            69.4           19.4           32.4            50.1          171.3
Equity in net losses of affiliates..........                                                          28.9           28.9
<FN>
---------------
(1)  Other includes certain  operating  businesses,  including E!  Entertainment
     (beginning on March 31, 1997),  the Company's  consolidated  United Kingdom
     cable and telecommunications  operations,  the Company's DBS operations and
     elimination entries related to the segments presented.
</FN>
</TABLE>

                                       17
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS

Overview

The Company has  experienced  significant  growth in recent  years both  through
strategic  acquisitions and growth in its existing  businesses.  The Company has
historically  met its cash  needs for  operations  through  its cash  flows from
operating   activities.   Cash   requirements   for   acquisitions  and  capital
expenditures have been provided through the Company's  financing  activities and
sales of long-term  investments,  as well as its existing cash, cash equivalents
and short-term investments.

General Developments of Business

Cable TV Fund 14 A/B Venture In October 1997, the Company and Jones  Intercable,
Inc. ("Jones Intercable") entered into an agreement whereby the Company, through
an  indirect  majority  owned  subsidiary,  will  acquire  Cable  TV Fund 14 A/B
Venture, a cable television system serving  approximately  65,000 subscribers in
and around Broward County,  Florida for $140 million in cash, subject to certain
adjustments.  The  acquisition  is expected to be funded with the proceeds  from
borrowings under one of the Company's  subsidiary's  existing credit facilities.
The  acquisition is subject to a number of conditions,  including the receipt of
necessary regulatory approvals and the approval of the limited partners of Cable
TV Fund 14 A/B  Venture.  The  acquisition  is  expected  to close in the  first
quarter of 1998.

Microsoft Investment
On June 30, 1997 (the "Issuance  Date"),  the Company and Microsoft  Corporation
("Microsoft") completed a Stock Purchase Agreement (the "Agreement") under which
Microsoft  purchased and the Company issued 24.6 million shares of the Company's
Class A Special  Common  Stock,  par value $1.00 per share (the "Class A Special
Stock"),  at $20.29 per share,  for $500.0  million  and  500,000  shares of the
Company's  newly  issued  5.25%  Series  B  Mandatorily  Redeemable  Convertible
Preferred  Stock,  par value $1,000 per share (the "Series B Preferred  Stock"),
for $500.0 million.

The Series B Preferred Stock has a 5.25% pay-in-kind annual dividend.  Dividends
will be paid  quarterly  through the issuance of  additional  shares of Series B
Preferred  Stock  (the  "Additional  Shares")  and will be  cumulative  from the
Issuance Date (except that dividends on the  Additional  Shares will accrue from
the date such  Additional  Shares are  issued).  The Series B  Preferred  Stock,
including the Additional  Shares,  is  convertible,  at the option of Microsoft,
into 21.2 million  shares of Class A Special  Stock,  subject to  adjustment  in
certain  limited  circumstances,  which  equals an initial  conversion  price of
$23.54 per share,  increasing as a result of the Additional Shares to $33.91 per
share on June 30, 2004. The Series B Preferred  Stock is mandatorily  redeemable
on June 30, 2017, or, at the option of the Company beginning on June 30, 2004 or
at the  option  of  Microsoft  on  June  30,  2004  or on June  30,  2012.  Upon
redemption,  the Company, at its option, may redeem the Series B Preferred Stock
with  cash,  Class A Special  Stock or a  combination  thereof.  As the  Company
currently  intends to redeem the Series B  Preferred  Stock with Class A Special
Stock upon  redemption,  the Series B Preferred  Stock has been  classified as a
component  of  stockholders'  equity as of  September  30,  1997.  The  Series B
Preferred Stock is generally non-voting.

Offerings of Subsidiary Debt
In May 1997, Comcast Cellular  Holdings,  Inc.  ("Comcast  Cellular"),  a wholly
owned  subsidiary of the Company,  completed the sale of $1.0 billion  principal
amount of 9 1/2% Senior Notes due 2007 (the "Cellular  Notes") through a private
offering with registration rights. The Cellular Notes are obligations of Comcast
Cellular and are not  obligations  of, nor guaranteed  by, the Company.  Comcast
Cellular used the net proceeds from the offering to repay existing borrowings by
its  subsidiaries,  including its senior  participating  redeemable  zero coupon
notes. Collectively,  these transactions are referred to herein as the "Cellular
Refinancing."

In May 1997,  Comcast Cable  Communications,  Inc.  ("Comcast  Cable"), a wholly
owned  subsidiary of the Company,  completed the sale of $1.7 billion  principal
amount of notes (the "Cable Notes") through a private offering with registration
rights.  The Cable Notes were issued in four tranches:  $300.0 million principal
amount of 8 1/8% Notes due 2004, $600.0 million principal amount of 8 3/8% Notes
due 2007, $550.0 million principal amount of 8 7/8% Notes due

                                       18
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


2017 and $250.0 million principal amount of 8 1/2% Notes due 2027. The Notes due
2027 are subject to  repurchase  at the option of the holder in 2009.  The Cable
Notes  are  obligations  of  Comcast  Cable  and are  not  obligations  of,  nor
guaranteed  by, the Company.  Comcast  Cable used  substantially  all of the net
proceeds from the offering to repay  existing  borrowings  by its  subsidiaries.
Collectively,   these   transactions  are  referred  to  herein  as  the  "Cable
Refinancing."

In October 1997, the Company completed an exchange of 100% of the Cellular Notes
and the Cable Notes for new notes (having the terms described  above) which were
registered under the Securities Act of 1933, as amended.

E! Entertainment
On March 31, 1997, the Company,  through Comcast Entertainment Holdings LLC (the
"LLC"), which is owned 50.1% by the Company and 49.9% by The Walt Disney Company
("Disney"), purchased a 58.4% interest in E! Entertainment Television, Inc. ("E!
Entertainment"),  an entertainment  programming service distributed to more than
42 million  subscribers,  from Time  Warner,  Inc.  ("Time  Warner")  for $321.9
million  (the  "E!  Acquisition").   The  E!  Acquisition  was  funded  by  cash
contributions  to the LLC by the Company and Disney of $132.8 million and $189.1
million,  respectively.  In  connection  with the E!  Acquisition,  the  Company
contributed its 10.4% interest in E!  Entertainment to the LLC.  Following these
transactions,  the LLC owns a 68.8%  interest in E!  Entertainment.  To fund the
cash contribution to the LLC, the Company borrowed $132.8 million from Disney in
the form of two 10-year, 7% notes (the "Disney Notes").

The Company  accounted for the E!  Acquisition  under the purchase method and E!
Entertainment  was consolidated  with the Company  effective March 31, 1997. The
allocation of the purchase price relating to the assets and liabilities of E!
Entertainment is preliminary pending a final appraisal.

After September 1998, Disney, in certain  circumstances,  is entitled to request
that the LLC  purchase  Disney's  entire  interest  in the LLC at its then  fair
market value (as determined by an appraisal  process).  If the LLC elects not to
purchase  Disney's  interest,  Disney has the right, at its option,  to purchase
either the Company's entire interest in the LLC or all of the shares of stock of
E!  Entertainment  held by the LLC,  in each case at fair market  value.  In the
event that Disney exercises its rights,  as described above, a portion or all of
the Disney Notes may be replaced with a three year note due to Disney.

Scripps Cable
In November 1996, the Company acquired the cable television operations ("Scripps
Cable") of The E.W.  Scripps  Company  ("E.W.  Scripps")  in exchange for 93.048
million  shares of Class A Special Stock valued at $1.552  billion (the "Scripps
Acquisition").  The  Company  accounted  for the Scripps  Acquisition  under the
purchase method and Scripps Cable was  consolidated  with the Company  effective
November 1, 1996.  During the second quarter of 1997,  the Company  recorded the
final purchase price allocation relating to the Scripps  Acquisition.  The terms
of the Scripps  Acquisition provide for, among other things, the indemnification
of  the  Company  by E.  W.  Scripps  for  certain  liabilities,  including  tax
liabilities, relating to Scripps Cable prior to the acquisition date.

Comcast-Spectacor
In July 1996,  the  Company  completed  its  acquisition  (the  "Sports  Venture
Acquisition") of a 66% interest in the Philadelphia Flyers Limited  Partnership,
a Pennsylvania limited partnership  ("PFLP"),  the assets of which, after giving
effect to the Sports Venture Acquisition, consist of (i) the National Basketball
Association  ("NBA")  franchise  to  own  and  operate  the  Philadelphia  76ers
basketball  team and related  assets (the  "Sixers"),  (ii) the National  Hockey
League ("NHL") franchise to own and operate the Philadelphia  Flyers hockey team
and related assets,  and (iii) two adjacent arenas,  leasehold  interests in and
development  rights related to the land underlying the arenas and other adjacent
parcels  of  land  located  in  Philadelphia,  Pennsylvania  (collectively,  the
"Arenas").  Concurrent  with the completion of the Sports  Venture  Acquisition,
PFLP was renamed Comcast Spectacor, L.P. ("Comcast-Spectacor").

The Sports Venture  Acquisition  was completed in two steps.  In April 1996, the
Company  purchased  the  Sixers  for $125.0  million  in cash plus  assumed  net
liabilities of approximately  $11.0 million through a partnership  controlled by
the  Company.  To complete the Sports  Venture  Acquisition,  in July 1996,  the
Company  contributed  its interest in the Sixers,  exchanged  approximately  3.5
million  shares of the  Company's  Class A Special Stock and 6,370 shares of the
Company's  newly issued 5% Series A Convertible  Preferred  Stock and paid $15.0
million in cash for its current  interest in Comcast-  Spectacor.  The remaining
34%  interest in  Comcast-Spectacor  is owned by a group,  including  the former
majority owner

                                       19
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


of PFLP,  who also  manages  Comcast-Spectacor.  In  connection  with the Sports
Venture  Acquisition,  Comcast-Spectacor  assumed  the  outstanding  liabilities
relating to the Sixers and the Arenas, including a mortgage obligation of $155.0
million.  The Company accounts for its interest in  Comcast-Spectacor  under the
equity method.

Liquidity and Capital Resources

Cash, Cash Equivalents and Short-term Investments
The  Company  has  traditionally  maintained  significant  levels of cash,  cash
equivalents  and  short-term   investments  to  meet  its  short-term  liquidity
requirements.  Cash, cash equivalents and short-term investments as of September
30, 1997 were $780.7  million.  As of September 30, 1997,  $260.7 million of the
Company's  cash, cash  equivalents and short-term  investments was restricted to
use by  subsidiaries  of the Company under  contractual  or other  arrangements,
including $100.5 million which is restricted to use by Comcast UK Cable Partners
Limited ("Comcast UK Cable").

The Company's cash  equivalents and short-term  investments are recorded at cost
which  approximates  their fair value.  As of  September  30,  1997,  short-term
investments have a weighted average maturity of approximately 7 months.

Investments
Sprint PCS. The Company, Tele-Communications,  Inc. ("TCI"), Cox Communications,
Inc.  ("Cox") and Sprint  Corporation  ("Sprint," and together with the Company,
TCI and Cox,  the  "Parents"),  and certain  subsidiaries  of the  Parents  (the
"Partner Subsidiaries"),  engage in the wireless communications business through
a limited  partnership known as "Sprint Spectrum" or "Sprint PCS," a development
stage  enterprise  through June 30, 1997. The Company owns 15% of Sprint PCS and
accounts for its investment in Sprint PCS under the equity method.

Under the  provisions  of the  Sprint PCS  partnership  agreement,  the  Partner
Subsidiaries  have  committed to  contribute  $4.2 billion in cash to Sprint PCS
through 1999, of which the Company's  share is $630.0  million.  Of this funding
requirement,  the  Company  has made total cash  contributions  to Sprint PCS of
$559.3 million  through  October 31, 1997. The Company  anticipates  that Sprint
PCS'  capital  requirements  over the next  several  years will be  significant.
Requirements  in excess of committed  capital are planned to be funded by Sprint
PCS through external financing, including, but not limited to, vendor financing,
bank financing and securities  offered to the public. In August 1996, Sprint PCS
sold $750.0  million  principal  amount at  maturity of Senior  Notes and Senior
Discount Notes due 2006 in a public offering. In October 1996, Sprint PCS closed
three  credit  agreements  providing  a  total  of  $5.1  billion  in  available
financing,  including  $2.0 billion in bank financing and $3.1 billion in vendor
financing. The timing of the Company's remaining capital contributions to Sprint
PCS is dependent upon a number of factors, including Sprint PCS' working capital
requirements.  The Company anticipates funding its remaining capital commitments
to Sprint PCS through its cash flows from  operating  activities,  its  existing
cash,  cash  equivalents,  short-term  investments  and lines of credit or other
external financing, or by a combination of these sources.

TCGI. Through June 1996, the Company held investments in Teleport Communications
Group,  Inc.  ("TCGI"),  TCG  Partners  and certain  local joint  ventures  (the
"Teleport Joint Ventures") managed by TCGI and TCG Partners.  TCGI is one of the
largest  competitive  alternative access providers in the United States in terms
of route miles.  The Company had a 20.0% investment in TCGI and interests in the
Teleport Joint  Ventures  ranging from 12.4% to 20.3%.  In June 1996,  TCGI sold
approximately  27 million  shares of its Class A Common Stock (the "TCGI Class A
Stock"),  for $16 per share,  in an initial public offering (the "TCGI IPO"). In
connection with the TCGI IPO, TCGI, the Company and subsidiaries of Cox, TCI and
Continental  Cablevision  ("Continental"  and collectively with Cox, TCI and the
Company, the "Cable  Stockholders")  entered into an agreement pursuant to which
TCGI was reorganized (the  "Reorganization").  The Reorganization  consisted of,
among  other  things:  (i) the  acquisition  by TCGI of TCG  Partners;  (ii) the
acquisition  by TCGI of  additional  interests  in the Teleport  Joint  Ventures
(including  100%  of  those  interests  held  by the  Company);  and  (iii)  the
contribution  to  TCGI  of  $269.0  million   aggregate   principal   amount  of
indebtedness,  plus  accrued  interest  thereon,  owed  by  TCGI  to  the  Cable
Stockholders (except that TCI retained a $26 million subordinated note of TCGI),
including $53.8 million  principal  amount and $4.1 million of accrued  interest
owed to the Company. In connection with the Reorganization, the Company received
25.6  million  shares of TCGI's Class B Common Stock (the "TCGI Class B Stock").
Each share of TCGI Class B Stock is entitled to voting power  equivalent  to ten
shares of TCGI Class A Stock and is  convertible,  at the option of the  holder,
into one share of TCGI Class A Stock.  As a result of the TCGI IPO,  the Company
recorded  a $40.6  million  increase  in its  proportionate  share of TCGI's net
assets as a gain from equity offering

                                       20
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


of affiliate  (the "TCGI IPO Gain") in its condensed  consolidated  statement of
operations and accumulated deficit for the nine months ended September 30, 1996.

During the three months ended March 31, 1997, the Company  received 2.76 million
shares of TCGI Class A Stock from TCGI in exchange for the  Company's  shares of
an alternate access provider. In May 1997, the Company sold all of its shares of
TCGI Class A Stock for $68.9 million and recognized a $68.9 million pre-tax gain
(the  "TCGI  Class A  Gain"),  which is  included  in  investment  income in its
condensed  consolidated  statement of operations and accumulated deficit for the
nine months ended September 30, 1997.

As of September  30, 1997,  the Company owns TCGI Class B Stock  representing  a
19.8%  voting  interest and a 15.5% equity  interest.  The Company  continues to
account  for its  interest in TCGI under the equity  method  based on its voting
interest maintained through the TCGI Class B Stock, its representation on TCGI's
board  of  directors  and  its  participation  in a TCGI  stockholder  agreement
granting  certain  rights to a control  group.  Assuming  conversion of the TCGI
Class B Stock  held by the  Company  into  TCGI  Class A  Stock,  the  Company's
investment in TCGI, which had a carrying value of $123.3 million as of September
30, 1997, would have a fair value of approximately $1.239 billion,  based on the
quoted market price of the TCGI Class A Stock as of October 31, 1997.

Roll-up of  Primestar's  Operations.  In June 1997,  the Company  entered into a
binding letter agreement (the "Roll-up  Agreement") with PRIMESTAR Partners L.P.
("Primestar")  and the  affiliates  of each of the other  partners of Primestar,
including TCI Satellite Entertainment, Inc. ("TSAT"), a publicly-traded company.
Primestar,  in which the Company holds a 10.4%  general and limited  partnership
interest,  is  principally  engaged in the  business of  acquiring,  originating
and/or providing television  programming services delivered by satellite through
a network of distributors,  including the Company, throughout the United States.
The  Roll-up  Agreement  sets  forth the  principal  terms and  conditions  of a
proposed  transaction (the "Roll-up  Transaction"),  through which the Company's
direct   broadcast   satellite   ("DBS")    operations,    Primestar   and   the
Primestar-related  distribution  businesses  of the other  partners of Primestar
will  be  consolidated  into  a  newly-formed   publicly-traded   company  ("New
Primestar").  In  connection  with the Roll-up  Transaction,  TSAT will become a
wholly owned  subsidiary of New  Primestar.  The Company  provided DBS services,
through a distributorship  arrangement with Primestar, to 169,000 subscribers as
of September 30, 1997.

New Primestar will acquire the Primestar partnership interests,  subscribers and
related assets,  as applicable,  of the parties to the Roll-up  Transaction,  in
exchange for (i) cash, (ii) shares of Series A Common Stock of New Primestar and
(iii)  shares  of  Series C Common  Stock of New  Primestar,  in each case in an
amount determined  pursuant to the Roll-up Agreement.  The Company will have the
right to continue to market and support the Primestar programming services on an
agency basis after consummation of the Roll-up  Transaction;  however, the terms
of such arrangement have not yet been determined. Under the terms of the Roll-up
Agreement,  upon closing of the Roll-up Transaction,  the Company is expected to
receive  approximately  $75 million in cash and to own  approximately 10% of New
Primestar  common  equity,  both  subject to  adjustment  based on the number of
subscribers,  inventory  amounts and other  factors.  As of September  30, 1997,
assets of the Company's DBS operations totaled $149.4 million.

In June 1997,  Primestar  entered  into an agreement  with The News  Corporation
Limited,  MCI  Telecommunications  Corporation and American Sky Broadcasting LLC
("ASkyB"),  pursuant to which New Primestar  (or,  under certain  circumstances,
Primestar) will acquire  certain assets relating to a high-power,  DBS business.
In exchange for such assets,  ASkyB will receive  non-voting  securities  of New
Primestar that will be convertible into non-voting common stock of New Primestar
and,  accordingly,  will  reduce the  Company's  common  equity  interest in New
Primestar to approximately 7% on a fully diluted basis, subject to adjustment.

These   transactions   are  not   conditioned   on  each  other  and  may  close
independently.  They are  expected  to close in 1998,  subject to receipt of all
necessary  governmental and regulatory approvals,  including the approval of the
Federal Communications Commission. There can be no assurance that such approvals
will be obtained.

@Home. In July 1997, At Home Corporation  ("@Home"),  an investee of the Company
previously  accounted for under the equity  method,  completed an initial public
offering of its Series A Common Stock (the "@Home IPO"). @Home provides Internet
services to customers and businesses over the cable television infrastructure in
a limited number of cities in the United States.  Effective July 1, 1997, due to
the dilution of the Company's equity and voting interests and

                                       21
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


other  factors  subsequent  to the @Home IPO, the Company has  discontinued  the
equity method of  accounting  for its  investment in @Home.  As of September 30,
1997,  the  Company  holds 8.0  million  contractually  restricted  shares  (the
"Restricted  Shares")  and 6.6 million  unrestricted  shares (the  "Unrestricted
Shares")  of  @Home  Series  A  Common  Stock  (the  "@Home  Series  A  Stock"),
representing a 12.4% and a 5.7% equity and voting  interest,  respectively.  The
Company has  recorded the  Restricted  Shares at their  historical  cost of $1.1
million and the Unrestricted Shares, which are classified as available for sale,
at their  estimated  fair market  value of $151.5  million,  based on the quoted
market  price  of the  @Home  Series  A Stock  as of  September  30,  1997.  The
unrealized  pre-tax  gain as of  September  30, 1997 of $150.6  million has been
reported in the Company's condensed consolidated balance sheet as a component of
stockholders'  equity,  net of  related  deferred  income  tax  expense of $52.7
million.

Nextel.  At December  31, 1996,  the Company  held 3.3 million  shares of Nextel
Communications,   Inc.  ("Nextel")  common  stock  and  options  to  acquire  an
additional  25.0 million  shares of Nextel common stock at $16 per share.  As of
December 31, 1996, these options, which had an historical cost of $20.0 million,
were included in investments in publicly traded companies at their fair value of
$32.6  million.  In February  1997, the Company sold these options to Nextel for
$25.0 million and  recognized a pre-tax gain of $5.0 million,  which is included
in  investment  income in the  Company's  condensed  consolidated  statement  of
operations and accumulated deficit for the nine months ended September 30, 1997.
In July 1997, the Company sold its 3.3 million shares of Nextel common stock for
$73.4 million,  resulting in a pre-tax gain of $32.2 million,  which is included
in  investment  income in the  Company's  condensed  consolidated  statement  of
operations and accumulated deficit for the nine and three months ended September
30, 1997.

In February 1996, in connection  with certain  preemptive  rights of the Company
under previously  existing  agreements with Nextel,  the Company  purchased 8.16
million  shares of Nextel common stock at $12.25 per share,  for $99.9  million.
During the nine and three months ended  September 30, 1996, the Company sold 5.6
million shares and 1.2 million shares, respectively,  of Nextel common stock for
$105.4 million and $19.9 million,  respectively, and recognized pre-tax gains of
$35.4 million and $5.8 million,  respectively,  which are included in investment
income in its condensed  consolidated  statement of operations  and  accumulated
deficit.

Time Warner/TBS.  The Company received 1.36 million shares of Time Warner common
stock (the "Time  Warner  Stock") in exchange  (the  "Exchange")  for all of the
shares of Turner Broadcasting  System, Inc. ("TBS") stock (the "TBS Stock") held
by the Company as a result of the merger of Time Warner and TBS in October 1996.
As a result of the  Exchange,  the Company  recognized  a pre-tax  gain of $47.3
million in the fourth quarter of 1996,  representing the difference  between the
Company's  historical  cost basis in the TBS Stock of $8.9  million  and the new
basis for the Company's investment in Time Warner Stock of $56.2 million,  which
was based on the closing  price of the Time  Warner  Stock on the merger date of
$41.375 per share.  In December 1996 and January  1997,  the Company sold 92,500
shares  and  1.27  million  shares,  respectively,  of the  Time  Warner  Stock,
representing the Company's entire interest in Time Warner,  for $3.7 million and
$48.6  million,  respectively.  In connection  with the January 1997 sales,  the
Company  recognized  a  pre-tax  loss of $3.8  million,  which  is  included  in
investment  income in its condensed  consolidated  statement of  operations  and
accumulated deficit for the nine months ended September 30, 1997. As of December
31, 1996,  the 1.27 million shares of Time Warner Stock held by the Company were
recorded at their fair value of $47.4  million and were  included in  short-term
investments in the Company's condensed consolidated balance sheet.

The Company does not have any  additional  significant  contractual  commitments
with respect to any of its investments.  However, to the extent the Company does
not fund its  investees'  capital  calls,  it exposes  itself to dilution of its
ownership interests.  The Company continually evaluates its existing investments
as well as new investment opportunities.

Financing
Other than the Scripps  Acquisition,  the Company  has  historically  utilized a
strategy of  financing  its  acquisitions  through  senior debt at the  acquired
operating  subsidiary level.  Additional financing has also been obtained by the
Company through the issuance of subordinated  debt at the  intermediate  holding
company and parent company levels and, to some extent,  through public offerings
of a subsidiary company's stock and debt instruments.

                                       22
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


The Cable Refinancing and the Cellular  Refinancing had a significant  impact on
the  maturities of the Company's  long-term  debt.  Maturities of long-term debt
outstanding  as of September  30, 1997 and December 31, 1996 through 2001 are as
follows (dollars in millions):
<TABLE>
<CAPTION>
                                                                        As of                   As of
                                                                 September 30, 1997       December 31, 1996

<S>                                                                   <C>                   <C>   
         1997.................................................        $  71.9 (1)              $229.5
         1998.................................................          110.0                   671.5
         1999.................................................          206.3                   462.5
         2000.................................................          305.3                   668.1
         2001.................................................          578.0                 1,282.4
<FN>
---------------
(1)  Represents  maturities of long-term debt for the remaining  three months of
     1997,  which  includes  $43.6 million of debt redeemed in October 1997 (see
     below) and a $10.0 million optional debt repayment made in October 1997.
</FN>
</TABLE>

As of September 30, 1997 and December 31, 1996, the Company's effective weighted
average  interest rate on its long-term  debt  outstanding  was 8.26% and 7.68%,
respectively.

In June 1997,  the Company  redeemed  all of its  outstanding  10%  Subordinated
Debentures,  due 2003 (the "10% Debentures").  An aggregate  principal amount of
$139.3 million of the 10% Debentures was redeemed at a redemption  price of 100%
of the principal amount thereof,  together with accrued interest thereon. On the
date of redemption, the 10% Debentures had an accreted value of $127.7 million.

In July 1997,  the Company made  optional  debt  repayments  aggregating  $527.0
million with existing cash, cash equivalents and short-term investments.

In October  1997,  the Company  completed the  redemption of its $250.0  million
principal amount 3 3/8% / 5 1/2% step up convertible subordinated debentures due
2005 (the "Step Up  Debentures").  The Company  issued 8.4 million shares of its
Class A Special Stock upon conversion of $206.4 million principal amount of Step
Up Debentures  while $43.6 million  principal  amount of Step Up Debentures  was
redeemed  for cash at a  redemption  price of 105.58% of the  principal  amount,
together with accrued interest thereon.  Stockholders'  equity will be increased
by the full amount of Step Up Debentures  converted plus accrued interest,  less
unamortized  debt  acquisition  costs.  In connection with the redemption of the
Step Up Debentures,  the Company will expense unamortized debt acquisition costs
and incur debt extinguishment costs of approximately $3.0 million,  resulting in
an  extraordinary  loss,  net of tax, of  approximately  $1.9 million during the
fourth quarter of 1997.

In October  1997, a  subsidiary  of the Company  refinanced  one of its existing
revolving credit facilities with the proceeds from borrowings under a new $400.0
million credit  agreement (the "New Bank Facility") with certain banks.  Initial
borrowings  under the New Bank Facility of $215.0 million were used  principally
to repay existing debt. As a result of the refinancing, the Company will expense
unamortized debt acquisition costs of approximately  $5.2 million,  resulting in
an  extraordinary  loss,  net of tax, of  approximately  $3.4 million during the
fourth quarter of 1997.

As of October 31, 1997, certain  subsidiaries of the Company had unused lines of
credit of $1.060 billion. The availability and use of the unused lines of credit
is restricted by the covenants of the related debt  agreements and to subsidiary
general purposes and dividend declaration. The Company continually evaluates its
debt structure with the intention of reducing its debt service requirements when
desirable.

                                       23
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


The following table summarizes the terms of the Company's existing interest rate
exchange  agreements  ("Swaps"),  interest  rate  cap  agreements  ("Caps")  and
interest  rate  collar  agreements  ("Collars")  as of  September  30,  1997 and
December 31, 1996 (dollars in millions):
<TABLE>
<CAPTION>
                                        Notional                             Average         Estimated
                                         Amount          Maturities       Interest Rate     Fair Value
<S>                                    <C>            <C>                <C>             <C> 
As of September 30, 1997
Variable to Fixed Swaps                    $600.0         1998-2000           5.56%           $6.6
Caps                                        150.0           1998              6.67%
Collars                                     100.0         1997-1998       6.64% / 4.95%

As of December 31, 1996
Variable to Fixed Swaps                  $1,080.0         1997-2000           5.85%           $7.4
Caps                                        250.0           1997              8.55%
Collars                                     620.0         1997-1998       6.98% / 5.16%        0.1
</TABLE>

The  notional  amounts of interest  rate  agreements,  as presented in the above
table,  are used to measure interest to be paid or received and do not represent
the amount of exposure to credit loss. The estimated fair value approximates the
proceeds  (costs) to settle the  outstanding  contracts.  While Swaps,  Caps and
Collars  represent  an  integral  part  of  the  Company's  interest  rate  risk
management  program,  their incremental  effect on interest expense for the nine
and three months ended September 30, 1997 and 1996 was not significant.

Concurrent with the announcement of the Scripps Acquisition in October 1995, the
Company  announced  that its Board of Directors  authorized a market  repurchase
program (the "Repurchase Program") pursuant to which the Company could purchase,
at such times and on such terms as it deemed  appropriate,  up to $500.0 million
of its outstanding common equity securities, subject to certain restrictions and
market  conditions.  Based on the trade date for stock  repurchases,  during the
nine  months  ended  September  30,  1997 and 1996 and the  three  months  ended
September 30, 1996, the Company  repurchased  2.3 million  shares,  10.1 million
shares and 3.6 million shares,  respectively,  of its common stock for aggregate
consideration of $36.2 million, $173.4 million and $56.8 million,  respectively,
pursuant to the Repurchase  Program.  During the term of the Repurchase Program,
which  terminated  on May 13,  1997,  the  Company  repurchased  a total of 13.5
million  shares  of its  common  stock  for  aggregate  consideration  of $228.6
million.

As part of the Repurchase Program, the Company sold put options on shares of its
Class A Special Stock.  Put options on 4.0 million  shares,  sold by the Company
during 1996 and 1995 and outstanding at December 31, 1996,  expired  unexercised
during the first  quarter of 1997.  Upon  expiration,  the Company  reclassified
$69.6 million, the amount it would have been obligated to pay to repurchase such
shares had the put options  been  exercised,  from common  equity put options to
additional capital in the Company's condensed consolidated balance sheet.

As part of the Repurchase  Program,  in April 1997, the Company sold put options
on 2.0 million  shares of its Class A Special  Stock.  The put options  give the
holder the right to require the Company to repurchase  such shares at $15.68 per
share on specific  dates in April and May 1998.  The amount the Company would be
obligated  to pay to  repurchase  such shares upon  exercise of the put options,
totaling $31.4 million,  has been reclassified from additional capital to common
equity put options in the Company's  September 30, 1997  condensed  consolidated
balance sheet.

Following  the Scripps  Acquisition,  the Company no longer had a  stockholders'
deficiency.  However,  the Company expects to continue to recognize  significant
losses for the  foreseeable  future,  resulting in  decreases  in  stockholders'
equity.   The   telecommunications   industry,   including  cable  and  cellular
communications,   and  the  electronic   retailing   industry  are  experiencing
increasing  competition and rapid  technological  changes.  The Company's future
results of operations will be affected by its ability to react to changes in the
competitive  environment  and by its  ability  to  implement  new  technologies.
However,  the Company believes that competition,  technological  changes and its
significant  losses  will  not  significantly   affect  its  ability  to  obtain
financing.

                                       24
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


The Company  believes  that it will be able to meet its  current  and  long-term
liquidity and capital  requirements,  including fixed charges,  through its cash
flows from operating  activities,  existing cash, cash  equivalents,  short-term
investments and lines of credit and other external financing.

Statement of Cash Flows

Cash and cash equivalents increased $242.3 million as of September 30, 1997 from
December 31, 1996 and  decreased  $112.9  million as of September  30, 1996 from
December 31, 1995. Changes in cash and cash equivalents resulted from cash flows
from operating, financing and investing activities which are explained below.

Net cash provided by operating  activities amounted to $742.1 million and $527.3
million for the nine months ended September 30, 1997 and 1996, respectively. The
increase of $214.8 million is  principally  due to the increase in the Company's
operating  income  before   depreciation  and  amortization   (see  "Results  of
Operations"),  including the effects of the Scripps Acquisition,  and changes in
working capital as a result of the timing of receipts and disbursements.

Net cash  provided  by (used in)  financing  activities  was $345.3  million and
($19.2)  million  for the  nine  months  ended  September  30,  1997  and  1996,
respectively.  During the nine months  ended  September  30,  1997,  the Company
borrowed  $2.968  billion,  including  the Cable  Notes of $1.691  billion,  the
Cellular  Notes of  $998.4  million,  the  Disney  Notes of $132.8  million  and
borrowings under its existing lines of credit,  and repaid $3.518 billion of its
long-term  debt,  including  $1.665 billion  relating to the Cable  Refinancing,
$981.8 million relating to the Cellular Refinancing,  $139.3 million relating to
the  redemption  of the 10%  Debentures  and  $527.0  million of  optional  debt
repayments  made in July 1997.  Deferred  financing  costs of $43.8 million were
incurred during the nine months ended September 30, 1997 related to the issuance
of the Cable Notes and the Cellular Notes.  In addition,  during the nine months
ended  September 30, 1997, the Company  received $1.0 billion from Microsoft for
the  issuance  of its Class A Special  Stock and  Series B  Preferred  Stock and
repurchased  $33.6  million of its common  stock.  During the nine months  ended
September 30, 1996, the Company borrowed $660.4 million under its existing lines
of credit and repaid $486.7 million,  including the effects of refinancings  and
$88.9 million of repayments under a vendor financing  arrangement.  In addition,
the  Company  repurchased  $171.2  million of its common  stock  during the nine
months ended September 30, 1996.

Net cash used in investing  activities was $845.1 million and $621.0 million for
the nine months ended September 30, 1997 and 1996, respectively. During the nine
months ended September 30, 1997, net cash used in investing  activities includes
acquisitions,  net  of  cash  acquired,  of  $136.1  million,  including  the E!
Acquisition of $118.7  million,  investments in affiliates of $180.3 million and
capital expenditures of $682.0 million, offset by the proceeds from the sales of
short-term  and long-term  investments  and a  distribution  from an investee of
$171.5  million and Sprint PCS'  repayment of a $25.2 million  loan.  During the
nine months  ended  September  30, 1996,  net cash used in investing  activities
includes  investments in affiliates of $447.6 million,  including $159.5 million
in connection  with the Sports Venture  Acquisition,  capital  contributions  to
Sprint PCS of $100.7 million and the purchase of Nextel shares of $99.9 million,
and capital expenditures of $450.2 million,  offset by proceeds from the sale of
short-term and long-term investments of $381.8 million, including $105.4 million
from the sale of Nextel shares.

Results of Operations

The effects of the Company's recent acquisitions, as well as increased levels of
capital expenditures,  were to increase significantly the Company's revenues and
expenses  resulting in  substantial  increases in its  operating  income  before
depreciation and amortization,  depreciation  expense,  amortization expense and
interest expense. In addition,  the Company's equity in net losses of affiliates
has increased  principally as a result of the start-up  nature of certain of the
Company's  equity  investees (see  "Operating  Results by Business  Segment" and
"Consolidated  Analysis"). As a result of the increases in depreciation expense,
amortization  expense,  interest expense and equity in net losses of affiliates,
it is expected  that the Company will continue to recognize  significant  losses
for the foreseeable future.

                                       25
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


Summarized  consolidated  financial information for the Company for the nine and
three  months  ended  September  30,  1997 and 1996 is as  follows  (dollars  in
millions, "NM" denotes percentage is not meaningful):

<TABLE>
<CAPTION>
                                                                   Nine Months Ended
                                                                     September 30,          Increase / (Decrease)
                                                                   1997         1996           $            %
<S>                                                              <C>          <C>            <C>           <C>  
Revenues..................................................       $3,519.5     $2,870.9       $648.6        22.6%
Cost of goods sold from electronic retailing..............          867.2        774.7         92.5        11.9
Operating, selling, general and administrative expenses...        1,586.2      1,234.2        352.0        28.5
                                                                 --------     --------
Operating income before depreciation and
   amortization (1).......................................        1,066.1        862.0        204.1        23.7
Depreciation..............................................          341.7        219.7        122.0        55.5
Amortization..............................................          362.0        271.3         90.7        33.4
                                                                 --------     --------
Operating income..........................................          362.4        371.0         (8.6)       (2.3)
                                                                 --------     --------
Interest expense..........................................          422.8        403.7         19.1         4.7
Investment income.........................................         (133.1)       (63.7)        69.4          NM
Equity in net losses of affiliates........................          212.1         89.2        122.9          NM
Gain from equity offering of affiliate....................                       (40.6)       (40.6)         NM
Other.....................................................           13.4         22.6         (9.2)      (40.7)
Income tax expense........................................           45.4         33.9         11.5        33.9
Minority interest.........................................          (66.8)       (47.4)        19.4        40.9
Extraordinary items.......................................          (25.9)        (1.0)        24.9          NM
                                                                 --------     --------
Net loss..................................................        ($157.3)      ($27.7)      $129.6          NM
                                                                 ========     ========
</TABLE>

<TABLE>
<CAPTION>
                                                                   Three Months Ended
                                                                      September 30,         Increase / (Decrease)
                                                                    1997         1996           $            %
<S>                                                              <C>            <C>          <C>           <C>  
Revenues..................................................       $1,204.2       $974.6       $229.6        23.6%
Cost of goods sold from electronic retailing..............          297.2        262.3         34.9        13.3
Operating, selling, general and administrative expenses...          542.0        416.5        125.5        30.1
                                                                 --------       ------
Operating income before depreciation and
   amortization (1) ......................................          365.0        295.8         69.2        23.4
Depreciation..............................................          120.2         77.0         43.2        56.1
Amortization..............................................          121.1         89.7         31.4        35.0
                                                                 --------       ------
Operating income..........................................          123.7        129.1         (5.4)       (4.2)
                                                                 --------       ------
Interest expense..........................................          143.9        135.7          8.2         6.0
Investment income.........................................          (44.5)       (16.2)        28.3          NM
Equity in net losses of affiliates........................           85.9         28.9         57.0          NM
Other.....................................................            9.0         (0.3)         9.3          NM
Income tax expense........................................            8.5          9.3         (0.8)       (8.6)
Minority interest.........................................          (27.0)       (18.4)         8.6        46.7
Extraordinary items.......................................           (3.1)                      3.1          NM
                                                                 --------       ------
Net loss..................................................         ($55.2)       ($9.9)       $45.3          NM
                                                                 ========       ======
<FN>
------------
(1)  Operating income before  depreciation and amortization is commonly referred
     to in the Company's  businesses as "operating  cash flow."  Operating  cash
     flow is a measure of a company's  ability to  generate  cash to service its
     obligations, including debt service obligations, and to finance capital and
     other  expenditures.  In part due to the  capital  intensive  nature of the
     Company's  businesses  and the  resulting  significant  level  of  non-cash
     depreciation  expense  and  amortization  expense,  operating  cash flow is
     frequently  used  as one of  the  bases  for  comparing  businesses  in the
     Company's industries. Operating cash flow does not purport to represent net
     income or net cash  

                                       26
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


     provided  by  operating  activities,  as  those  terms  are  defined  under
     generally accepted accounting  principles,  and should not be considered as
     an  alternative  to such  measurements  as an  indicator  of the  Company's
     performance.  See  "Statement  of Cash Flows" above for a discussion of net
     cash provided by operating activities.
</FN>
</TABLE>

Operating Results by Business Segment

Domestic Cable Communications

As a result of the Scripps Acquisition,  the Company commenced consolidating the
financial  results of Scripps Cable  effective  November 1, 1996.  The following
table presents actual financial  information for the nine and three months ended
September 30, 1997 and pro forma  financial  information  for the nine and three
months  ended  September  30,  1996 as if the  Scripps  Acquisition  occurred on
January  1,  1996.  Pro forma  financial  information  is  presented  herein for
purposes of analysis and may not reflect  what actual  operating  results  would
have been had the Company  owned Scripps Cable since January 1, 1996 (dollars in
millions):

<TABLE>
<CAPTION>
                                                       Nine Months Ended
                                                          September 30,                        Increase
                                                     1997              1996               $                 %
<S>                                                 <C>              <C>                <C>                <C> 
Service income...................................   $1,537.0         $1,398.3           $138.7             9.9%
Operating, selling, general and
     administrative expenses.....................      812.4            722.3             90.1            12.5
                                                    --------         --------           ------
Operating income before depreciation
     and amortization (a)........................     $724.6           $676.0            $48.6             7.2%
                                                    ========         ========           ======

                                                       Three Months Ended
                                                          September 30,                        Increase
                                                     1997              1996               $                 %
Service income...................................     $515.1           $469.2            $45.9             9.8%
Operating, selling, general and
     administrative expenses.....................      267.2            242.9             24.3            10.0
                                                    --------         --------           ------
Operating income before depreciation
     and amortization (a)........................     $247.9           $226.3            $21.6             9.5%
                                                    ========         ========           ======
<FN>
---------------
(a) See footnote (1) on page 26.
</FN>
</TABLE>

Of the respective  $138.7 million and $45.9 million  increases in service income
for the nine and three month  periods from 1996 to 1997,  $28.7 million and $9.1
million are attributable to subscriber  growth,  $94.2 million and $32.9 million
relate to changes in rates and $15.8  million and $3.9  million  relate to other
product offerings.

Of the  respective  $90.1  million and $24.3  million  increases  in  operating,
selling,  general  and  administrative  expenses  for the nine and  three  month
periods from 1996 to 1997,  $20.9 million and $3.8 million are  attributable  to
increases in the costs of cable  programming  as a result of subscriber  growth,
additional  channel  offerings  and  changes in rates,  $16.1  million  and $5.0
million are  attributable to increases in costs associated with customer service
and $53.1 million and $15.5 million  result from increases in the cost of labor,
other volume related expenses and costs  associated with new product  offerings.
It is anticipated that the Company's cost of cable  programming will increase in
the future as cable programming  rates increase and additional  sources of cable
programming become available.

                                       27
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


Electronic Retailing

The following  table sets forth operating  results for the Company's  electronic
retailing   segment,   consisting  of  the  operations  of  QVC,  Inc.  and  its
subsidiaries  ("QVC"), a majority owned and controlled subsidiary of the Company
(dollars in millions):

<TABLE>
<CAPTION>
                                                       Nine Months Ended
                                                          September 30,                        Increase
                                                     1997              1996               $                 %
<S>                                                 <C>              <C>                 <C>              <C>  
Net sales from electronic retailing..............   $1,438.0         $1,286.9            $151.1           11.7%
Cost of goods sold from electronic retailing.....      867.2            774.7              92.5           11.9
Operating, selling, general and administrative
     expenses....................................      339.9            303.6              36.3           12.0
                                                    --------         --------            ------
Operating income before depreciation
     and amortization (a)........................     $230.9           $208.6             $22.3           10.7%
                                                    ========         ========            ======

Gross margin.....................................       39.7%            39.8%


                                                       Three Months Ended
                                                          September 30,                        Increase
                                                     1997              1996               $                 %
Net sales from electronic retailing..............     $490.6           $431.1             $59.5           13.8%
Cost of goods sold from electronic retailing.....      297.2            262.3              34.9           13.3
Operating, selling, general and administrative
     expenses....................................      117.1             99.6              17.5           17.6
                                                    --------         --------            ------
Operating income before depreciation
     and amortization (a)........................      $76.3            $69.2              $7.1           10.3%
                                                    ========         ========            ======

Gross margin.....................................       39.4%            39.2%
<FN>
---------------
(a) See footnote (1) on page 26.
</FN>
</TABLE>

The  respective  increases  in net sales  from  electronic  retailing  of $151.1
million and $59.5 million for the nine and three month periods from 1996 to 1997
are  primarily   attributable  to  the  effects  of  7.2%  and  7.5%  increases,
respectively,  in the  average  number of homes  receiving  QVC  services in the
United States and 14.1% and 14.7% increases, respectively, in the average number
of homes receiving QVC services in the United Kingdom.

The  increases in cost of goods sold from  electronic  retailing  are  primarily
related to the growth in net sales. The changes in gross margin from 1996 to the
same periods in 1997 are a result of changes in product mix.

Of the respective  increases in operating,  selling,  general and administrative
expenses of $36.3 million and $17.5 million for the nine and three month periods
from 1996 to 1997, $21.0 million and $7.4 million are primarily  attributable to
start-up costs incurred by QVC in Germany,  which began operations in the fourth
quarter of 1996. The remaining  increases of $15.3 million and $10.1 million are
primarily  attributable to higher sales volume offset, in part, by the reduction
in expenses realized upon consolidation of QVC's multichannel  operations and an
increase in net finance  fee income  from  credit card  operations  for the nine
month period from 1996 to 1997.

                                       28
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


Cellular Communications

The following table sets forth the operating results for the Company's  cellular
communications segment (dollars in millions):
<TABLE>
<CAPTION>
                                                       Nine Months Ended
                                                          September 30,                   Increase/(Decrease)
                                                     1997              1996               $                 %
<S>                                                   <C>              <C>                <C>              <C> 
Service income...................................     $335.4           $317.1             $18.3            5.8%
Operating, selling, general and administrative
     expenses....................................      195.4            198.3              (2.9)          (1.5)
                                                    --------         --------            ------
Operating income before depreciation
     and amortization (a)........................     $140.0           $118.8             $21.2           17.8%
                                                    ========         ========            ======

                                                       Three Months Ended
                                                          September 30,                        Increase
                                                     1997              1996               $                 %
Service income...................................     $115.1           $110.0              $5.1            4.6%
Operating, selling, general and administrative
     expenses....................................       63.7             62.3               1.4            2.2
                                                    --------         --------            ------
Operating income before depreciation
     and amortization (a)........................      $51.4            $47.7              $3.7            7.8%
                                                    ========         ========            ======
<FN>
---------------
(a) See footnote (1) on page 26.
</FN>
</TABLE>

Of the respective $18.3 million and $5.1 million increases in service income for
the nine and three  month  periods  from 1996 to 1997,  $16.9  million  and $2.3
million are  attributable to the Company's  subscriber  growth and $11.9 million
and $4.6 million are  attributable to roamer growth.  Offsetting these increases
are  decreases of $10.5  million and $1.8  million  resulting  primarily  from a
reduction  in the  average  rate per  minute of use as a result  of  promotional
and/or free minutes.

The $2.9 million  decrease in  operating,  selling,  general and  administrative
expenses for the nine month  period from 1996 to 1997 is primarily  attributable
to  expense  reductions  achieved  through  implementation  of fraud  management
programs, improved bad debt experience as a result of stronger credit procedures
and a reduction in commission  costs resulting from fewer gross sales in 1997 as
compared to the same period in 1996.  The $1.4  million  increase in  operating,
selling,  general and  administrative  expenses  for the three month period from
1996 to 1997 is primarily  attributable to an increase in the number of cellular
retail stores in 1997 as compared to the same period in 1996,  partially  offset
by  expense  reductions  achieved  through  implementation  of fraud  management
programs  and  improved  bad debt  experience  as a result  of  stronger  credit
procedures.

Consolidated Analysis

The  respective  $122.0  million and $43.2  million  increases  in  depreciation
expense for the nine and three  month  periods  from 1996 to 1997 are  primarily
attributable  to the  effects  of the  Scripps  Acquisition  and the  effects of
capital  expenditures.  Depreciation expense for the nine months ended September
30, 1997 includes the effects of the final purchase price allocation relating to
the Scripps Acquisition.

The respective $90.7 million and $31.4 million increases in amortization expense
for  the  nine  and  three  month  periods  from  1996  to  1997  are  primarily
attributable to the effects of the Scripps Acquisition. Amortization expense for
the nine  months  ended  September  30, 1997  includes  the effects of the final
purchase price allocation relating to the Scripps Acquisition.

The respective $19.1 million and $8.2 million  increases in interest expense for
the nine and three month periods from 1996 to 1997 are attributable to increased
levels of debt and changes in the Company's  weighted average interest rate. The
Company anticipates that, for the foreseeable future, interest expense will be a
significant  cost to the Company and 

                                       29
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


will have a significant  adverse effect on the Company's  ability to realize net
earnings.  The  Company  believes  it will  continue  to be  able  to  meet  its
obligations  through  its  ability  both to  generate  operating  income  before
depreciation and amortization and to obtain external financing.

The respective  $69.4 million and $28.3 million  increases in investment  income
for  the  nine  and  three  month  periods  from  1996  to  1997  are  primarily
attributable to the gains recognized in 1997 on the sales of Nextel common stock
and TCGI Class A stock,  offset by the gains  recognized in 1996 on the sales of
Nextel common stock.

The  respective  $122.9  million and $57.0  million  increases  in equity in net
losses of affiliates  for the nine and three month periods from 1996 to 1997 are
primarily due to the effects of increased  losses  incurred by Sprint PCS, TCGI,
the UK Investees and certain of the Company's  other equity  investees,  and the
effects of the E!  Acquisition  (see below) and the Sports Venture  Acquisition.
Based  on  Sprint  PCS'  current  operations  and  business  plan,  the  Company
anticipates  that  its  proportionate  share  of  Sprint  PCS'  losses  will  be
significant in future periods.  In addition,  as a result of the E! Acquisition,
the Company recorded a charge representing the cumulative amount that would have
been recorded had the Company  accounted for its investment in E!  Entertainment
under the equity method since the date of initial  investment  (the  "Cumulative
Charge").   Since  the  Company's  proportionate  share  of  E!  Entertainment's
cumulative  losses was in excess of the  Company's  historical  cost basis in E!
Entertainment and as the Company was under no contractual obligation to fund the
losses of E!  Entertainment,  the Cumulative Charge was limited to the Company's
historical cost basis of $12.1 million. Such amount is included in equity in net
losses of  affiliates  in the  Company's  condensed  consolidated  statement  of
operations and accumulated  deficit for the nine months ended September 30, 1997
as it is not  significant  for restatement of the Company's prior year financial
statements.

Gain from equity  offering of affiliate for the nine months ended  September 30,
1996 represents the TCGI IPO Gain.

The respective $9.2 million decrease and $9.3 million increase in other expenses
for  the  nine  and  three  month  periods  from  1996  to  1997  are  primarily
attributable  to the  settlement  of certain  litigation  during the nine months
ended September 30, 1996 and the effects of fluctuations in the foreign currency
exchange rate.

The $11.5 million  increase in income tax expense for the nine month period from
1996 to 1997 is  primarily a result of an  increase in state  income tax expense
due to  increases  in the net income of certain of the  Company's  subsidiaries,
increases  in  non-deductible  foreign  losses  and  equity  in  net  losses  of
affiliates  and  increased  goodwill  amortization  resulting  from the  Scripps
Acquisition,  offset by the effect of the increase in the Company's  loss before
income tax expense, minority interest and extraordinary items.

The $19.4 million and $8.6 million  increases in minority  interest for the nine
and three month  periods  from 1996 to 1997 are  primarily  attributable  to the
effects of changes in the net income (loss) of QVC and Comcast UK Cable.

Extraordinary  items, for the nine and three months ended September 30, 1997, of
$25.9 million or $.08 per common share and $3.1 million or $.01 per common share
consist of unamortized debt acquisition costs and debt  extinguishment  costs of
$39.8 million and $4.7 million,  respectively, net of the related tax benefit of
$13.9 million and $1.6 million, respectively, incurred principally in connection
with the Cable Refinancing,  the Cellular  Refinancing and the redemption of the
10%  Debentures in the second  quarter of 1997 and the optional debt  repayments
made in the third quarter of 1997.

For the nine and three months ended  September 30, 1997 and 1996,  the Company's
distributions from investees and earnings before extraordinary items, income tax
expense, equity in net losses of affiliates and fixed charges (interest expense)
were  $550.7  million,  $502.6  million,  $186.2  million  and  $166.5  million,
respectively.  Such earnings were adequate to cover the Company's fixed charges,
including interest  capitalized of $18.0 million,  $23.3 million,  zero and $8.6
million,  of $440.8 million,  $427.0 million,  $143.9 million and $144.3 million
for the nine and three months ended  September 30, 1997 and 1996,  respectively.
Fixed charges include non-cash interest expense, net of interest capitalized, of
$42.7 million,  $48.1 million,  $13.8 million and $15.9 million for the nine and
three months ended September 30, 1997 and 1996, respectively.

                                       30
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


The  Company  believes  that  its  losses  will  not  significantly  affect  the
performance of its normal business activities because of its existing cash, cash
equivalents and short-term investments, its ability to generate operating income
before  depreciation  and  amortization  and  its  ability  to  obtain  external
financing.

The  Company  believes  that  its  operations  are not  materially  affected  by
inflation.

                                       31
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997


PART II.  OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

     The  Company  is not  party to  litigation  which,  in the  opinion  of the
     Company's management,  will have a material adverse effect on the Company's
     financial position, results of operations or liquidity.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a)       Exhibits required to be filed by Item 601 of Regulation S-K:

                    10.1*     Comcast  Corporation  1996 Stock Option  Plan,  as
                              amended  and  restated,  effective  September  16,
                              1997.

                    10.2*     Comcast  Corporation  1996  Deferred  Compensation
                              Plan, as amended and restated, effective September
                              16, 1997.

                    10.3*     Comcast Corporation 1990 Restricted Stock Plan, as
                              amended  and  restated,  effective  September  16,
                              1997.

                    10.4*     Comcast  Corporation  1996  Cash  Bonus  Plan,  as
                              amended and restated, effective May 30, 1997.

                    10.5*     Comcast  Corporation  1997  Deferred  Stock Option
                              Plan, effective September 16, 1997.

                    27.1      Financial Data Schedule.

          (b)       Reports on Form 8-K:

                    (i)       Comcast Corporation filed a Current Report on Form
                              8-K under Item 5 on July 3, 1997  relating  to the
                              completion   of  the  $1  billion   investment  by
                              Microsoft Corporation in Comcast Corporation.









----------
*    Constitutes a management contract or compensatory plan or arrangement.

                                       32
<PAGE>
                      COMCAST CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 1997

                                    SIGNATURE

         Pursuant to the  requirements  of the  Securities  and  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 S. SMITH
                                             -----------------------------------

                                             Lawrence S. Smith
                                             Executive Vice President
                                             (Principal Accounting Officer)



Date: November 14, 1997

                                       33