Charter continues to shed internet subscribers, reflecting cable's growth woes

By Emily Bary

Company also adds 486,000 mobile lines, but loses 405,000 video subscribers in first quarter

Charter Communications Inc. (CHTR) lost more internet subscribers than expected in the first quarter as the cable industry's broadband growth challenges continued.

The company on Friday reported a net loss of 72,000 internet subscribers for the period, roughly double the 37,000 that analysts tracked by FactSet were expecting. Charter's results come a day after cable peer Comcast Corp. (CMCSA) also saw steeper losses from internet subscribers than analysts had been modeling.

The trend isn't new for Charter and Comcast, which face competitive pressures that have made subscriber growth in their internet businesses more challenging. Verizon Communications Inc. (VZ) and T-Mobile US Inc. (TMUS) have been making inroads with fixed-wireless offerings, and there is also competition from fiber operators like AT&T Inc. (T)

At the same time, cable companies have been making wireless plays, and Charter reported 486,000 net additions of total mobile lines for its latest quarter.

The company lost a net 405,000 video subscribers, nearly all of which were in its residential business.

Shares were off about 4% in Friday's premarket action. The stock is among the biggest S&P 500 laggards so far this year, off 33% over the course of 2024, through Thursday's close.

Overall revenue at Charter came in at $13.7 billion, essentially flat with the year-earlier sum and in line with what analysts were forecasting. Charter said the top-line performance was driven by 37.8% growth in residential mobile-service revenue and 1.9% growth in residential-internet revenue.

Net income was $1.11 billion, or $7.66 a share, compared with $1.02 billion, or $6.74 a share, in the year-before period. Analysts were looking for $7.78.

The company logged adjusted earnings before interest, taxes, depreciation and amortization (Ebitda) of $5.5 billion, up 2.8% from a year before. That matched the consensus view.

-Emily Bary

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04-26-24 0742ET

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