Charter gains 4% as Internet gains trump Q3's financial miss
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Charter Communications (NASDAQ:CHTR) is 4.2% higher after posting third-quarter earnings that missed financial targets but apparently scored where it matters: on adding Internet customers.
Charter missed expectations on top and bottom lines. Revenue grew just 3.5% year-over-year, and while earnings per share rose (thanks to a sharply lower number of outstanding shares), attributable net income fell to $1.19B from a year-ago $1.22B.
But it added a net 61,000 residential Internet customers, leading its total Internet customer count (residential and small/medium business) to 30.33M, a total 1.4% over a year ago.
That comes amid an ongoing bleed in cable TV customers. Charter lost a net 211,000 residential video subs, accelerating from a year-ago decline of 133,000, and residential video subs have fallen 4.2% year-over-year to 14.6M.
Residential voice customers fell by 271,000, and total voice customers declined 8.4% year-over-year to land at 9.22M. Mobile lines continue to see growth, with 396,000 total quarterly net adds bringing the total customer count to 4.68M (up 47% year-over-year).
Those financials were "just light" of expectations but the core broadband net adds were better than expected, Citi says. The shares "likely to rebound near-term on better volume," the bank said.
Wells Fargo saw a mixed report, as the financials missed but "net add activity and mobile growth appears to signal a better operating environment than previously feared."
For more, dig into Charter's earnings call presentation.