Key Points:
- Charter Q2 revenue rose 0.6% to $13.8 billion, driven by mobile and broadband growth despite video and Internet subscriber losses.
- Net income hit $1.3 billion, up 5.7% year-over-year, while adjusted EBITDA grew 0.5 percent to $5.7 billion.
- Charter lost 117,000 broadband and 80,000 video customers but added 500,000 mobile lines, reaching 10.9 million total mobile lines.
- Free cash flow dropped to $1.0 billion due to mobile device costs and tax timing; capital spending totaled $2.9 billion.
Charter Communications saw stagnant revenue growth during the second quarter (Q2) of the year as the company’s efforts in wireless offset continued customer declines in its broadband and video segments.
Overall revenue during Q2 clocked in at $13.8 billion, a 0.6 percent increase compared to Q2 2024, largely due to a higher uptake in Charter’s Spectrum Wireless product for residential broadband subscribers, even as more customers switched off their Spectrum Internet service. Net income reached $1.3 billion, up nearly 6 percent on a year-over basis.
Broadband customers dipped by 117,000 accounts, Charter said in a press release. By the end of Q2, Charter served 29.9 million Internet subscribers.
The company saw gains in its Spectrum Mobile wireless business, with 500,000 new lines during Q2 to end the period with nearly 11 million mobile lines served. The number of lines doesn’t necessarily correlate with Charter’s subscriber count, because one subscriber may pay for multiple lines of wireless service.
Total video customers declined by 5.1 percent. Charter ended Q2 with 12.09 million residential video customers, reflecting a loss of 73,000 accounts. Small business video customers clocked in at 544,000, a loss of 7,000 customers compared to the prior year. Spectrum TV revenue fell 9.9 percent to $3.5 billion.
While video churn remains a concern for Charter, its subscriber losses were substantially smaller than the 408,000 video customers lost during Q2 2024. Charter has been working to retain subscribers by offering lower-cost TV packages that include access to ad-supported streaming services backed by TV companies, including Disney Plus, Hulu, Paramount Plus, Peacock, Vix and AMC Plus. The company plans to extend this perk to include access to ESPN Unlimited, BET Plus, Hulu and Discovery Plus by the end of the year.
On the broadband side, Charter announced all-inclusive, transparent pricing with certain customer service-related guarantees for its residential subscribers last September. Earlier this year, many of those same price perks and service-related guarantees were extended to business broadband subscribers as well.
“Unlike competitors, Spectrum upgrades its network to serve all of its passings and can do so at a much lower cost,” the company said in a statement on Friday.
“Our converged connectivity revenue grew by over 5 percent in the second quarter, with a long runway for growth,” Chris Winfrey, the President and CEO of Charter, said in a statement on Friday. “Our seamless connectivity products offer the fastest speeds at the best price. And our strategic investments in network evolution and convergence, rural build, U.S.-based service and seamless entertainment innovation, will accelerate future customer and revenue growth.”
On the financial side, Charter reported adjusted EBITDA of $5.7 billion, a 0.5 percent year-over-year increase. Free cash flow declined to $1.0 billion from $1.3 billion in the prior-year quarter, primarily due to changes in mobile device working capital and the timing of tax and interest payments. Capital expenditures rose slightly to $2.9 billion, including $1.0 billion spent on wireline extensions as part of Charter’s rural expansion efforts.
