LIBERTY BROADBAND CORPORATION

Condensed Consolidated Statements of Equity

(unaudited)


						Accumulated		Noncontrolling
					Additional	other		interest in
	Common stock				paid-in	comprehensive	Retained	equity of
	Series A		Series B	Series C	capital	earnings	earnings	subsidiaries	Total equity

	amounts in millions
Balance at January 1, 2023	$	—	—	1	3,318	9	5,155	18	8,501
Net earnings (loss)		—	—	—	—	—	69	—	69
Other comprehensive earnings (loss), net of taxes		—	—	—	—	50	—	—	50
Stock-based compensation		—	—	—	8	—	—	—	8
Issuance of common stock upon exercise of stock options		—	—	—	1	—	—	—	1
Withholding taxes on net share settlements of stock-based compensation		—	—	—	(2)	—	—	—	(2)
Liberty Broadband stock repurchases		—	—	—	(40)	—	—	—	(40)
Noncontrolling interest activity at Charter and other		—	—	—	(3)	—	—	—	(3)
Balance at March 31, 2023	$	—	—	1	3,282	59	5,224	18	8,584


						Accumulated		Noncontrolling
					Additional	other		interest in
	Common stock				paid-in	comprehensive	Retained	equity of
	Series A		Series B	Series C	capital	earnings	earnings	subsidiaries	Total equity

	amounts in millions
Balance at January 1, 2022	$	—	—	1	6,214	14	3,898	12	10,139
Net earnings (loss)		—	—	—	—	—	299	—	299
Other comprehensive earnings (loss), net of taxes		—	—	—	—	(4)	—	—	(4)
Stock-based compensation		—	—	—	9	—	—	—	9
Withholding taxes on net share settlements of stock-based compensation		—	—	—	(3)	—	—	—	(3)
Liberty Broadband stock repurchases		—	—	—	(843)	—	—	—	(843)
Noncontrolling interest activity at Charter and other		—	—	—	(2)	—	—	4	2
Balance at March 31, 2022	$	—	—	1	5,375	10	4,197	16	9,599

See accompanying notes to the condensed consolidated financial statements.

~~I-3~~I-7

Table of Contents

LIBERTY BROADBAND CORPORATION

~~Condensed Consolidated Statements of Comprehensive Earnings (Loss)~~

~~(unaudited)~~

Three months ended

Nine months ended

September 30,

September 30,

2017

2016

2017

2016

(amounts in thousands)

Net earnings (loss)

$
(9,864)

3,789

(27,286)

871,702

Other comprehensive earnings (loss), net of taxes:

Unrealized holding gains (losses) arising during the period

—

—

—

(221)

Share of other comprehensive earnings (loss) of equity method affiliates

260

247

634

811

Other

—

—

—

(1,839)

Other comprehensive earnings (loss), net of taxes

260

247

634

(1,249)

Comprehensive earnings (loss) attributable to Liberty Broadband shareholders

$
(9,604)

4,036

(26,652)

870,453

~~See accompanying notes to the condensed consolidated financial statements.~~

~~I-4~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

~~Condensed Consolidated Statements of Cash Flows~~

~~(unaudited)~~

Nine months ended

September 30,

2017

2016

(amounts in thousands)

Cash flows from operating activities:






Net earnings (loss)

$
(27,286)

871,702

Adjustments to reconcile net earnings (loss) to net cash provided by operating activities:

Depreciation and amortization

2,844

2,935

Stock-based compensation

4,376

4,582

Share of (earnings) losses of affiliates

(25,109)

(570,178)

(Gain) loss on dilution of investment in affiliate

42,515

(760,074)

Realized and unrealized (gains) losses on financial instruments, net

(5,026)

(92,990)

Deferred income tax expense (benefit)

(18,259)

533,626

Other, net

1,080

112

Changes in operating assets and liabilities:

Current and other assets

(1,455)

7,954

Payables and other liabilities

2,724

(2,702)

Net cash provided (used) by operating activities

(23,596)

(5,033)

Cash flows from investing activities:

Capital expended for property and equipment

(27)

(154)

Purchases of short term investments and other marketable securities

—

(155,444)

Sales of short term investments and other marketable securities

—

164,458

Investment in equity method affiliate

—

(5,000,000)

Other investing activities, net

14

453

Net cash provided (used) by investing activities

(13)

(4,990,687)

Cash flows from financing activities:

Borrowings of debt

500,000

200,000

Repayments of debt

(600,000)

—

Cash received from issuance of Series C Liberty Broadband common stock

—

4,400,000

Payments from issuances of financial instruments

(101,638)

—

Proceeds from settlements of financial instruments

155,683

—

Other financing activities, net

(739)

(318)

Net cash provided (used) by financing activities

(46,694)

4,599,682

Net decrease in cash

(70,303)

(396,038)

Cash and cash equivalents, beginning of period

205,728

655,079

Cash and cash equivalents, end of period

$
135,425

259,041

~~See accompanying notes to the condensed consolidated financial statements.~~

~~I-5~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

~~Condensed Consolidated Statement of Equity~~

~~(unaudited)~~

Accumulated

Additional

other

Preferred

Common stock

paid-in

comprehensive

Retained

Stock

Series A

Series B

Series C

capital

earnings

earnings

Total equity

(amounts in thousands)

Balance at January 1, 2017

$
—

262

25

1,530

7,945,883

7,656

517,736

8,473,092

Net earnings (loss)

—

—

—

—

—

—

(27,286)

(27,286)

Other comprehensive earnings

—

—

—

—

—

634

—

634

Stock-based compensation

—

—

—

—

4,017

—

—

4,017

Issuance of common stock upon exercise of stock options

—

—

—

1

2,416

—

—

2,417

Cumulative effect of accounting change at Charter (note 4)

—

—

—

—

—

—

17,361

17,361

Balance at September 30, 2017

$
—

262

25

1,531

7,952,316

8,290

507,811

8,470,235

~~See accompanying notes to the condensed consolidated financial statements.~~

~~I-6~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

Notes to Condensed Consolidated Financial Statements

(unaudited)

(1) Basis of Presentation

~~During May 2014,~~The accompanying condensed consolidated financial statements include the ~~board of directors~~accounts of Liberty ~~Media~~Broadband Corporation and its controlled subsidiaries ~~(“Liberty”) authorized management to pursue a plan to spin-off to its stockholders common stock of a wholly-owned subsidiary,~~(collectively, "Liberty Broadband," the "Company," “us,” “we,” or “our” unless the context otherwise requires). Liberty Broadband Corporation (“Liberty Broadband” or the “Company”), and to distribute subscription rights to acquire shares of Liberty Broadband Series C common stock (the “Broadband Spin-Off”). At the time of the Broadband Spin-Off, Liberty Broadband wasis primarily comprised of ~~(i) Liberty’s former interest~~GCI Holdings, LLC (“GCI Holdings” or “GCI”), a wholly owned subsidiary, and an equity method investment in Charter Communications, Inc. (“~~Legacy~~ Charter”)~~, (ii) Liberty’s former wholly-owned subsidiary TruePosition, Inc., (iii) Liberty’s former minority equity investment in Time Warner Cable,~~.

On December 18, 2020, GCI Liberty, Inc. (“~~Time Warner Cable”~~GCI Liberty”), (iv) certain deferred tax liabilities, as well as liabilities related to Time Warner Cable written call options and (v) initial indebtedness, pursuant to margin loans entered into prior to the completion of the Broadband Spin-Off. These financial statements refer to the combination of the aforementioned subsidiary, investments, and financial instruments as “Liberty Broadband,” “the Company,” “us,” “we” and “our” in the notes to the condensed consolidated financial statements.

~~On May 18, 2016, Time Warner Cable~~ was merged with Legacy Charter (the “Time Warner Cable Merger”). In connection with the Time Warner Cable Merger, Legacy Charter underwent a corporate reorganization, resulting in CCH I, LLC (“Charter”), a former subsidiary of Legacy Charter, becoming the new publicly traded parent company. Also on May 18, 2016, the previously announced acquisition of Bright House Networks, LLC from Advance/Newhouse Partnership (“A/N”) by Charter (the “Bright House Transaction”) was completed. In connection with the Time Warner Cable Merger and Bright House Transaction, Liberty Broadband entered into certain agreements with Legacy Charter, Charter (for accounting purposes a related party of the Company), Liberty Interactive Corporation (“Liberty Interactive,” for accounting purposes a related party of the Company)(the “Combination”) and ~~Time Warner Cable. As a result of the Time Warner Cable Merger and Bright House Transaction (collectively, the “Transactions”),~~ Liberty Broadband exchanged its shares of Time Warner Cable for shares of Charter and purchased additional shares of Charter. As a result, and pursuant to proxy agreements entered into with Liberty Interactive and A/N, Liberty Broadband controls 25.01% of the aggregate voting power of Charter. See note 4 for additional detail regarding these transactions and corresponding agreements.

The Company’s wholly owned subsidiary, Skyhook Holding, Inc. (formerly known as TruePosition, Inc.), was originally incorporated to provide technology for locating wireless phones and other mobile devices through a passive network overlay system using its patented U-TDOA technology (“U-TDOA service”). In February 2014, Skyhook Holding, Inc. acquired 100% of the outstanding common shares of Skyhook Wireless, Inc., which operates a global location network containing billions of geolocated Wi-Fi access points and cell towers that serve as the reference infrastructure for providing location services. In 2015, one of Skyhook Holding, Inc.’s customers, a wireless carrier utilizing the legacy U-TDOA service which accounted for approximately 80% - 90% of consolidated revenue at the time, gave notice that it planned to discontinue use of the U-TDOA service and did not intend to renew its contract, which expired on December 31, 2015. The loss of this customer had a material adverse effect on Skyhook Holding, Inc.’s business. As a result of the loss of this wireless carrier customer, further changes in the regulatory environment and a shift in the overall market for the legacy U-TDOA service, Skyhook Holding, Inc. ceased making further investment in its U-TDOA products. In 2016, Skyhook Holding, Inc. and Skyhook Wireless, Inc. combined operations in order to focus on the development and sale of the suite of location and context products, and are referred to collectively herein as “Skyhook.”GCI Holdings.

The accompanying (a) condensed consolidated balance sheet as of December 31, ~~2016,~~2022, which has been derived from audited financial statements, and (b) interim unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X as promulgated by the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the results for such periods have been included. The results of operations for any interim period are not necessarily indicative of results for the full year. Additionally, certain prior period amounts have been reclassified for comparability with current period presentation. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in Liberty Broadband's Annual Report on

~~I-7~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(unaudited)~~

Form 10-K for the year ended December 31, ~~2016.~~2022. All significant intercompany accounts and transactions have been eliminated in the condensed consolidated financial statements.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The Company considers (i) the application of the equity method of accounting for ~~investments in affiliates,~~its affiliate, (ii) ~~the~~non-recurring fair value measurements of non-financial instruments ~~(iii) the fair value of financial instruments, (iv) revenue recognition~~ and ~~(v)~~(iii) accounting for income taxes to be its most significant estimates.

~~In February 2016,~~Through a number of prior years’ transactions, including the Financial Accounting Standards Board (the “FASB”) issued new accounting guidance on lease accounting. This guidance requires a company to recognize lease assets and lease liabilities arising from operating leases in the statement of financial position. The new guidance also simplifies the accounting for sale and leaseback transactions. The amendments in this update are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted. We plan to adopt this guidance on January 1, 2019. Companies are required to use a modified retrospective approach to adopt this guidance. The Company is currently working with its consolidated subsidiary, Skyhook, to evaluate the impact of the adoption of this new guidance on our consolidated financial statements, including identifying the population of leases, evaluating technology solutions and collecting lease data.

In May 2014, the FASB issued new accounting guidance on revenue from contracts with customers. The new guidance requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. This new guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In March 2016, the FASB issued additional guidance which clarifies principal versus agent considerations, and in April 2016, the FASB issued further guidance which clarifies the identification of performance obligations and the implementation guidance for licensing. The updated guidance will replace most existing revenue recognition guidance in GAAP when it becomes effective and permits the use of either a full retrospective or modified retrospective transition method. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The Company anticipates adopting this guidance under the modified retrospective transition method. Skyhook has substantially completed the review of its revenue arrangements and does not currently expect that the adoption of the new standard will have a material impact on its financial position or results of operations. Additionally, Charter, which is accounted for as an equity method investment, has substantially completed its review of its revenue arrangements and does not currently expect that the adoption of the new standard will have a material impact on its financial position or results of operations.

Combination, Liberty Broadband ~~holds~~has acquired an interest in Charter. The investment in Charter ~~that~~ is accounted for using the equity method. Liberty Broadband does not control the decision making process or business management practices of this affiliate. Accordingly, Liberty Broadband relies on the management of this affiliate to provide it with accurate financial information prepared in accordance with GAAP that the Company uses in the application of the equity method. In addition, Liberty Broadband relies on audit reports that are provided by the affiliate's independent auditor on the financial statements of such affiliate. The Company is not aware, however, of any errors in or possible misstatements of the financial information provided by its equity affiliate that would have a material effect on Liberty Broadband's condensed consolidated financial statements.

~~Spin-Off Arrangements~~

~~Following the Broadband Spin-Off, Liberty and~~Skyhook Holdings, Inc. (“Skyhook”) was a wholly owned subsidiary of Liberty Broadband ~~operate as separate, publicly traded companies, and neither has any stock ownership, beneficial or otherwise,~~until its sale on May 2, 2022 for aggregate consideration of approximately $194 million, including amounts held in escrow of approximately $23 million. Liberty Broadband recognized a gain on the sale of $179 million, net of closing fees, in the ~~other.~~second quarter of 2022. Skyhook is included in Corporate and other through April 30, 2022 and is not presented as a discontinued operation as the sale did not represent a strategic shift that had a major effect on Liberty Broadband’s operations and financial results. Included in Revenue in the accompanying condensed consolidated statements of operations is $5 million for the three months ended March 31, 2022, related to Skyhook. Included in Net earnings (loss) in the accompanying condensed consolidated statement of operations are earnings of $3 million for the three months ended March 31, 2022, related to Skyhook.

As described in note 4, we are currently participating in Charter’s share buyback program in order to maintain our fully diluted ownership percentage of 26%. The primary use of those proceeds has been to repurchase Liberty Broadband

I-8

Realized and Unrealized Gains (Losses) on Financial Instruments

Realized and unrealized gains (losses) on financial instruments are comprised of changes in the fair value of the following:


	Three months ended
	March 31,
	2023		2022

	amounts in millions
Indemnification obligation	$	(3)	85
Exchangeable senior debentures (1)		(111)	52
	$	(114)	137

Three months ended

Nine months ended

September 30,

September 30,

2017

2016

2017

2016

(amounts in thousands)

Time Warner Cable investment (1)

$
—

—

—

92,990

Derivative instruments (2)

2,675

—

5,026

—

$
2,675

—

5,026

92,990

(1)

~~As discussed~~The Company has elected to account for its exchangeable senior debentures using the fair value option. Changes in ~~note 4, Time Warner Cable merged with Charter on May 18, 2016. Therefore~~ the fair value of the exchangeable senior debentures recognized in the condensed consolidated statements of operations are primarily due to market factors driven by changes in the fair value of the underlying shares into which the debt is exchangeable. The Company ~~no longer has an investment in Time Warner Cable as~~isolates the portion of ~~May 18, 2016, and~~ the unrealized gain (loss) ~~related~~attributable to ~~our investment~~the change in ~~Time Warner Cable is recorded through this date.~~ ~~In connection with~~ the ~~merger,~~instrument specific credit risk and recognizes such amount in other comprehensive income. The change in the ~~Company exchanged,~~fair value of the exchangeable senior debentures attributable to changes in the instrument specific credit risk before tax was a ~~tax-free transaction, its shares~~gain of ~~Time Warner Cable~~$64 million and a loss of $6 million for ~~shares of Charter Class A common stock~~.

~~(2)~~

As of December 31, 2016, the Company had an outstanding zero-strike call option on 704,908 shares of Liberty Broadband Series C common stock which the Company exercised in March 2017. In April 2017, the Company entered into another zero-strike call option on 600,242 shares of Liberty Broadband Series C common stock. The Company prepaid a premium of $50.0 million in April 2017. Upon expiration in June 2017, the call option was rolled into a new zero-strike call option on 600,242 shares of Liberty Broadband Series C common stock. Liberty Broadband exercised its option to settle the contract in cash in August 2017 for cash proceeds of $53.8 million. The Company realized gains on the options outstanding and settled during the three ~~and nine~~ months ended ~~September 30, 2017.~~

March 31, 2023 and 2022, respectively. The cumulative change was a gain of $64 million as of March 31, 2023.

I-11

Table of Contents

LIBERTY BROADBAND CORPORATION

Notes to Condensed Consolidated Financial Statements

(unaudited)

(4) Investment in Charter Accounted for Using the Equity Method

~~In May 2013, Liberty acquired approximately 26.9 million shares~~Through a number of Legacy Charter common stock and approximately 1.1 million warrants to purchase shares of Legacy Charter common stock for approximately $2.6 billion, which represented an approximate 27% beneficial ownership (including the warrants on an as if converted basis) in Legacy Charter at the time of purchase and price per share of $95.50. Liberty funded the purchase with a combination of cash on hand of approximately $1.2 billion and new margin loan arrangements. Liberty allocated the purchase price between the shares of common stockprior years’ transactions and the ~~warrants~~Combination, Liberty Broadband has acquired an interest in the transaction by determining the fair value of the publicly traded warrants and allocating the remaining balance to the shares acquired, which resulted in an initial excess basis in the investment of $2,532 million.Charter. The investment in ~~Legacy~~ Charter is accounted for as an equity method affiliate based on ~~the~~our voting and ownership interest ~~obtained~~ and the board seats held by individuals appointed by ~~Liberty.~~

~~During May 2014,~~ Liberty purchased 897 thousand Legacy Charter shares for approximately $124.5 million. During November 2014, subsequent to the Broadband Spin-Off, Liberty Broadband exercised all of its outstanding warrants to purchase shares of Legacy Charter common stock for approximately $52 million.

On May 18, 2016, the Time Warner Cable Merger was completed, which resulted in Legacy Charter and Time Warner Cable becoming wholly owned subsidiaries of Charter. Also on May 18, 2016, the previously announced Bright House Transaction was completed. In connection with these transactions, Legacy Charter underwent a corporate reorganization, resulting in Charter, a former subsidiary of Legacy Charter, becoming the new publicly traded parent company. In connection with the Time Warner Cable Merger and the Bright House Transaction, Liberty Broadband completed the previously announced transactions described below:

~~I-11~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(unaudited)~~

~~Transactions Completed in Connection with the Time Warner Cable Merger~~

~~Charter Investment Agreement~~

On May 18, 2016, Liberty Broadband completed its previously announced investment in Charter in accordance with the investment agreement dated May 23, 2015 by and among Liberty Broadband, Legacy Charter and Charter (the “Charter Investment Agreement”). Pursuant to the Charter Investment Agreement, immediately following the consummation of the Time Warner Cable Merger, Liberty Broadband purchased from Charter $4.3 billion of shares of Charter Class A common stock, par value $0.001 per share, at a price per share of $195.70 following adjustment by the applicable exchange ratio. As a result, Liberty Broadband received approximately 22.0 million shares of Charter Class A common stock. Liberty Broadband funded its purchase of these shares of Charter Class A common stock with proceeds from the issuance of Liberty Broadband Series C common stock.

~~Charter Contribution Agreement~~

Also on May 18, 2016, shares of Time Warner Cable common stock held by Liberty Broadband and Liberty Interactive were exchanged, in a tax-free transaction, for shares of Charter Class A common stock which resulted in each of Liberty Broadband and Liberty Interactive receiving one share of Charter Class A common stock for each share of Time Warner Cable common stock so exchanged. In the exchange, Liberty Broadband received approximately 2.4 million shares of Charter Class A common stock, with a fair value of $531.9 million.

~~Liberty Interactive Proxy Agreement~~

Pursuant to the Proxy and Right of First Refusal Agreement, dated May 23, 2015, as amended (the “Liberty Interactive Proxy Agreement”), by and between Liberty Broadband and Liberty Interactive, Liberty Interactive granted Liberty Broadband an irrevocable proxy to vote all shares of Charter common stock owned beneficially or of record by Liberty Interactive following the closing of the Time Warner Cable Merger, for a five year term subject to extension upon the mutual agreement of both parties, subject to certain limitations. So long as the Liberty Interactive Proxy Agreement is in effect, Liberty Broadband also has a right of first refusal (“ROFR”) to purchase all or a portion of any shares of Charter common stock which Liberty Interactive proposes to transfer, subject to certain limitations.

~~Transactions Completed in Connection with the Bright House Transaction~~

~~Second Amended and Restated Stockholders Agreement~~

On May 18, 2016, pursuant to the Stockholders Agreement, upon the closing of the Bright House Transaction, Liberty Broadband purchased from Charter approximately 3.7 million additional shares of Charter Class A common stock at a price per share of $191.33 following adjustment by the applicable exchange ratios, for an aggregate purchase price of $700 million. Liberty Broadband funded its $700 million purchase in shares of Charter through cash on hand and margin loan draws, as discussed in note 6.

~~Proxy and Right of First Refusal Agreement~~

In connection with the Bright House Transaction, on May 18, 2016, A/N and Liberty Broadband entered into a proxy and right of first refusal agreement, as amended (“A/N Proxy”), pursuant to which A/N granted Liberty Broadband a five-year proxy to vote shares of Charter held by A/N, capped at a number of shares representing 7% of the voting power of Charter’s outstanding shares. As a result of the A/N Proxy and the Liberty Interactive Proxy Agreement, Liberty Broadband controls 25.01% of the aggregate voting power of Charter following the completion of the Time Warner Cable Merger and the Bright House Transaction and is Charter’s largest stockholder.

~~I-12~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(unaudited)~~

So long as the A/N Proxy is in effect, if A/N proposes to transfer common units of Charter Communications Holdings, LLC (which units are exchangeable into Charter shares and which will, under certain circumstances, result in the conversion of certain shares of Class B Common Stock into Charter shares) or Charter shares, in each case, constituting either (i) shares representing the first 7.0% of the outstanding voting power of Charter held by A/N or (ii) shares representing the last 7.0% of the outstanding voting power of Charter held by A/N, Liberty Broadband will have a ROFR to purchase all or a portion of any such securities A/N proposes to transfer. The purchase price per share for any securities sold to Liberty Broadband pursuant to the ROFR will be the volume-weighted average price of Charter shares for the two trading day period before the notice of a proposed sale by A/N, payable in cash. Certain transfers are permitted to affiliates of A/N, subject to the transferee entity entering into an agreement assuming the transferor’s obligations under the A/N Proxy.

~~Investment in Charter~~

For discussion purposes the term “Charter” will be used to discuss both our previous and current holdings in Legacy Charter and Charter. It is noted that the ticker symbol for the Class A common stock of each of Legacy Charter and Charter are the same, and that in connection with the Time Warner Cable Merger, Legacy Charter underwent a corporate reorganization, resulting in Charter, a former subsidiary of Legacy Charter, becoming the new publicly traded parent company.

Broadband. As of ~~September 30, 2017,~~March 31, 2023, the carrying and market value of Liberty Broadband’s ownership in Charter was approximately ~~$9,327 million. The market value~~$11.6 billion and $16.8 billion, respectively. We own an approximate 31.3% economic ownership interest in Charter, based on shares of Charter’s Class A common stock issued and outstanding as of March 31, 2023.

Upon the closing of the Time Warner Cable merger, the Second Amended and Restated Stockholders Agreement, dated as of May 23, 2015, by and among Charter, Liberty Broadband and Advance/Newhouse Partnership, as amended (the “Stockholders Agreement”), became fully effective. Pursuant to the Stockholders Agreement, Liberty Broadband’s equity ownership in Charter as(on a fully diluted basis) is capped at the greater of ~~September 30, 2017 was approximately $19,651 million, which represented an approximate economic ownership~~26% or the voting cap (“Equity Cap”). As of ~~22%~~March 31, 2023, due to Liberty Broadband’s voting interest exceeding the current voting cap of 25.01%, our voting control of the ~~outstanding equity~~aggregate voting power of Charter is 25.01%. Under the Stockholders Agreement, Liberty Broadband has agreed to vote (subject to certain exceptions) all voting securities beneficially owned by it, or over which it has voting discretion or control that are in excess of the voting cap, in the same proportion as all other votes cast by public stockholders of Charter with respect to the applicable matter.

In February 2021, Liberty Broadband was notified that ~~date.~~its ownership interest, on a fully diluted basis, had exceeded the Equity Cap set forth in the Stockholders Agreement. On February 23, 2021, Charter and Liberty Broadband entered into a letter agreement in order to implement, facilitate and satisfy the terms of the Stockholders Agreement with respect to the Equity Cap. Pursuant to this letter agreement, following any month during which Charter purchases, redeems or buys back shares of its Class A common stock, and prior to certain meetings of Charter’s stockholders, Liberty Broadband will be obligated to sell to Charter, and Charter will be obligated to purchase, such number of shares of Class A common stock as is necessary (if any) to reduce Liberty Broadband’s percentage equity interest, on a fully diluted basis, to the Equity Cap (such transaction, a “Charter Repurchase”). The per share sale price for each share of Charter will be equal to the volume weighted average price paid by Charter in its repurchases, redemptions and buybacks of its common stock (subject to certain exceptions) during the month prior to the Charter Repurchase (or, if applicable, during the relevant period prior to the relevant meeting of Charter stockholders). Under the terms of the letter agreement, Liberty Broadband sold 120,149 and 970,241 shares of Charter Class A common stock to Charter for $42 million and $602 million during the three months ended March 31, 2023 and 2022, respectively, to maintain our fully diluted ownership percentage at 26%.

Investment in Charter

The excess basis in our investment in Charter is ~~$2,100 million as of September 30, 2017 and has been~~ allocated within memo accounts used for equity method accounting purposes as follows (amounts in millions):


		March 31,	December 31,
		2023	2022
Property and equipment	$	499	524
Customer relationships		2,200	2,230
Franchise fees		3,838	3,809
Trademarks		29	29
Goodwill		4,013	3,975
Debt		(407)	(450)
Deferred income tax liability		(1,509)	(1,505)
	$	8,663	8,612

Property and equipment

$
174

Customer relationships

346

Franchise fees

1,170

Trademarks

29

Goodwill

1,046

Debt

(20)

Deferred income tax liability

(645)

$
2,100

I-12

Table of Contents

~~Upon acquisition, Liberty Broadband ascribed remaining useful lives of 7 years and 13 years~~LIBERTY BROADBAND CORPORATION

Notes to ~~property~~Condensed Consolidated Financial Statements

(unaudited)

Property and equipment and customer relationships have weighted average remaining useful lives of approximately 4 years and 8 years, respectively, and ~~indefinite lives to~~ franchise fees, trademarks and ~~goodwill.~~goodwill have indefinite lives. The excess basis of outstanding debt is amortized over the contractual period using the ~~effective interest rate~~straight-line method. The increase in excess basis for the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2023 was primarily due to Charter’s share buyback program. The Company’s ~~Share~~share of earnings (losses) of ~~affiliates~~affiliate line item in the accompanying condensed consolidated statements of operations includes expenses of ~~$15.3~~$69 million and ~~$18.5~~$67 million, net of related taxes, for the three months ended ~~September 30, 2017~~March 31, 2023 and ~~2016, respectively, and expenses of $44.0 million and $23.2 million, net of related taxes, for the nine months ended September 30, 2017 and 2016,~~2022, respectively, due to the amortization of the excess basis related to assets with identifiable useful lives and debt.

The Company had a dilution ~~loss~~losses of ~~$3.7 million~~$27 and ~~$16.3~~$56 million during the three months ended ~~September 30, 2017~~March 31, 2023 and ~~2016, respectively, and a dilution loss of $42.5 million and a dilution gain of $760.1 million during the nine months ended September 30, 2017 and 2016,~~2022, respectively. The dilution ~~gain~~losses for the nine months ended September 30, 2016 is primarily attributable to Liberty Broadband’s investment basis in Charter at a price per share below the new equity issued in the Time Warner Cable Merger. The dilution losses during the other periods presented ~~are~~were primarily attributable to stock option exercises by employees and other third parties, ~~at prices below~~partially offset by a gain on dilution related to Charter’s repurchase of Liberty Broadband’s ~~book basis per share.~~

~~I-13~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(unaudited)~~

~~Accounting Change~~

Charter adopted Accounting Standards Update (“ASU”) 2016-09 on January 1, 2017. Upon adoption of ASU 2016-09, Charter recognized excess tax benefits of approximately $136 million in deferred tax assets that were previously not recognized in a cumulative-effect adjustment to retained earnings. The impact of this entry onshares during both the ~~Company’s equity is reflected in the line item Cumulative effect of accounting change at Charter in the accompanying condensed consolidated statement of equity.~~three months ended March 31, 2023 and 2022.

Summarized unaudited financial information for Charter is as ~~follows (amounts in millions):~~follows:

Charter condensed consolidated balance sheets


	March 31, 2023		December 31, 2022

	amounts in millions
Current assets	$	4,067	4,017
Property and equipment, net		36,602	36,039
Goodwill		29,563	29,563
Intangible assets, net		69,845	70,135
Other assets		4,793	4,769
Total assets	$	144,870	144,523
Current liabilities	$	12,242	12,065
Deferred income taxes		19,030	19,058
Long-term debt		95,973	96,093
Other liabilities		4,723	4,758
Equity		12,902	12,549
Total liabilities and shareholders’ equity	$	144,870	144,523

I-13

Table of Contents

LIBERTY BROADBAND CORPORATION

Notes to Condensed Consolidated Financial Statements

(unaudited)

September 30, 2017

December 31, 2016

Current assets

$
4,132

3,300

Property and equipment, net

33,300

32,963

Goodwill

29,554

29,509

Intangible assets, net

79,905

81,924

Other assets

1,337

1,371

Total assets

$
148,228

149,067

Current liabilities

10,419

9,572

Deferred income taxes

26,576

26,665

Long-term debt

66,064

59,719

Other liabilities

2,591

2,745

Equity

42,578

50,366

Total liabilities and shareholders’ equity

$
148,228

149,067

Charter condensed consolidated statements of operations


	Three months ended
	March 31,
	2023		2022

	amounts in millions
Revenue	$	13,653	13,200
Cost and expenses:
Operating costs and expenses (excluding depreciation and amortization)		8,511	8,134
Depreciation and amortization		2,206	2,294
Other operating expenses, net		10	1
		10,727	10,429
Operating income		2,926	2,771
Interest expense, net		(1,265)	(1,060)
Other income (expense), net		(104)	23
Income tax (expense) benefit		(374)	(345)
Net income (loss)		1,183	1,389
Less: Net income attributable to noncontrolling interests		(162)	(186)
Net income (loss) attributable to Charter shareholders	$	1,021	1,203

Three months ended

Nine months ended

September 30,

September 30,

2017

2016

2017

2016
Revenue
$
10,458

10,037

30,979

18,728
Cost and expenses:

Operating costs and expenses (excluding depreciation and amortization)

(6,703)

(6,482)

(19,857)

(12,157)
Depreciation and amortization

(2,701)

(2,437)

(7,846)

(4,412)
Other operating expenses, net

(145)

(207)

(374)

(776)

(9,549)

(9,126)

(28,077)

(17,345)
Operating income

909

911

2,902

1,383
Interest expense, net

(788)

(724)

(2,250)

(1,771)
Other income (expense), net

(3)

79

(55)

429
Income tax benefit (expense)

(26)

(16)

(99)

3,135
Net income (loss)

92

250

498

3,176
Less: Net income attributable to noncontrolling interests

(44)

(61)

(156)

(108)
Net income (loss) attributable to Charter shareholders
$
48

189

342

3,068

(5) Intangible Assets

Intangible Assets Subject to Amortization, net


	March 31, 2023				December 31, 2022
	Gross			Net	Gross		Net
	carrying		Accumulated	carrying	carrying	Accumulated	carrying
	amount		amortization	amount	amount	amortization	amount

	amounts in millions
Customer relationships	$	515	(101)	414	515	(91)	424
Other amortizable intangible assets		153	(61)	92	147	(55)	92
Total	$	668	(162)	506	662	(146)	516

Amortization expense for intangible assets with finite useful lives was $16 million and $17 million for the three months ended March 31, 2023 and 2022, respectively. Amortization expense for amortizable intangible assets for each of the five succeeding fiscal years is estimated to be (amounts in millions):


Remainder of 2023	$	47
2024	$	57
2025	$	52
2026	$	49
2027	$	48

I-14

Table of Contents

LIBERTY BROADBAND CORPORATION

Notes to Condensed Consolidated Financial Statements

(unaudited)

~~(5) Goodwill and Other Intangible Assets~~

~~There were no changes in the carrying amount of goodwill during the nine months ended September 30, 2017.~~

~~Intangible assets subject to amortization are comprised of the following (amounts in thousands):~~

September 30, 2017

December 31, 2016

Gross

Net

Gross

Net

Carrying

Accumulated

Carrying

Carrying

Accumulated

Carrying

Amount

Amortization

Amount

Amount

Amortization

Amount

Acquired patents

$
10,823

(9,633)

1,190

10,823

(8,450)

2,373

Customer relationships

10,213

(6,463)

3,750

10,213

(5,440)

4,773

Tradename

2,838

(1,809)

1,029

2,838

(1,528)

1,310

Capitalized software

857

(763)

94

850

(710)

140

$
24,731

(18,668)

6,063

24,724

(16,128)

8,596

Skyhook’s patents are amortized straight-line over three and a half years and Skyhook’s tradename and customer relationship are amortized straight-line over five and a half years. Capitalized software intangible assets are amortized over three to five years. Amortization expense was $842 thousand and $850 thousand for the three months ended September 30, 2017 and 2016, respectively, and $2.5 million and $2.6 million for the nine months ended September 30, 2017 and 2016, respectively.

~~The estimated future amortization expense for the next five years related to intangible assets with definite lives as of September 30, 2017 is as follows (amounts in thousands):~~

Remainder of 2017

$
841

2018

$
2,575

2019

$
1,776

2020

$
871

2021

$
—

(6) Debt

~~Outstanding debt at September 30, 2017 and December 31, 2016~~Debt is summarized as follows:

September 30, 2017

December 31, 2016

(amounts in thousands)
2014 Margin Loans
$
—

400,000
2016 Margin Loans

—

200,000
2017 Margin Loans

500,000

—
Deferred loan costs

(3,025)

(1,488)

$
496,975

598,512
Less debt classified as current

—

(400,000)
Total long-term debt
$
496,975

198,512


	Outstanding
	principal		Carrying value
	March 31,		March 31,		December 31,
	2023		2023		2022
	amounts in millions
Margin Loan Facility	$	1,400		1,400	1,400
3.125% Exchangeable Senior Debentures due 2053		1,265		1,251	—
1.25% Exchangeable Senior Debentures due 2050		2		2	798
2.75% Exchangeable Senior Debentures due 2050		—		—	560
1.75% Exchangeable Senior Debentures due 2046		—		—	15
Senior notes		600		626	628
Senior credit facility		396		396	397
Wells Fargo note payable		5		5	5
Deferred financing costs				(1)	(2)
Total debt	$	3,668		3,679	3,801
Debt classified as current				(5)	(1,376)
Total long-term debt			$	3,674	2,425

~~I-15~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(unaudited)~~

~~2014 Margin Loans~~

On October 30, 2014, in connection with and prior to the effectiveness of the Broadband Spin-Off, a wholly-owned special purpose subsidiary of the Company (“BroadbandSPV”) entered into two margin loan agreements (the “2014 Margin Loan Agreements”) with each of the lenders party thereto. The 2014 Margin Loan Agreements permitted BroadbandSPV, subject to certain funding conditions, to borrow term loans up to an aggregate principal amount equal to $400 million (the “2014 Margin Loans”). The maximum borrowing capacity of $400 million under the 2014 Margin Loan Agreements was outstanding at December 31, 2016. The maturity date of the 2014 Margin Loans was October 30, 2017, accordingly the debt was classified as current as of December 31, 2016. Borrowings under the 2014 Margin Loan Agreements bore interest at the three-month LIBOR rate plus a per annum spread of 1.55%, and had an unused commitment fee of 0.25% per annum based on the average daily unused portion of the 2014 Margin Loans. Interest was payable quarterly in arrears beginning on December 31, 2014. On August 31, 2017, the outstanding borrowings of $400 million were repaid, as discussed below.

~~2016 Margin Loans~~

On March 21, 2016, a wholly-owned special purpose subsidiary of the Company (“Cheetah 5”), entered into two margin loan agreements (the “2016 Margin Loan Agreements” and together with the 2014 Margin Loan Agreements, the “Margin Loan Agreements”) with each of the lenders party thereto. The 2016 Margin Loan Agreements permitted Cheetah 5, subject to certain funding conditions, to borrow initial term loans up to an aggregate principal amount equal to $200 million and delayed draw loans (the “Draw Loans”) up to an aggregate principal amount equal to $100 million, for an aggregate total of $300 million (collectively the “2016 Margin Loans”). Cheetah 5 had borrowed $200 million as of December 31, 2016 and had $100 million available to be drawn until September 21, 2017. The maturity date of the 2016 Margin Loans was March 21, 2018, accordingly the debt was classified as noncurrent as of December 31, 2016. Borrowings under the 2016 Margin Loans bore interest at the applicable LIBOR rate plus 2.10% per annum and had an unused commitment fee of 0.5% per annum based on the average daily unused portion of the Draw Loans. Interest was payable quarterly in arrears beginning on March 31, 2016. The proceeds of the 2016 Margin Loans were used for the Company’s additional investment in Charter during May 2016, as discussed in note 4. On August 31, 2017, the outstanding borrowings of $200 million were repaid, as discussed below.

~~2017~~ Margin Loan Facility

On ~~August 31, 2017,~~November 8, 2022, a bankruptcy remote wholly owned subsidiary of the Company (“~~SPV”~~SPV”), entered into Amendment No. 6 to Margin Loan Agreement (the “Sixth Amendment”), which amends SPV’s margin loan agreement, dated as of August 31, 2017 (as amended by the Sixth Amendment, the “Margin Loan Agreement”), with a ~~multi-draw margin~~group of lenders. The Margin Loan Agreement provides for (x) a term loan credit facility (the “2017 Margin Loan Facility” and, the credit agreement governing such facility, the “2017 Margin Loan Agreement”) with Bank of America, N.A and the lenders thereunder. SPV is permitted, subject to certain funding conditions, to borrow term loans up toin an aggregate principal amount ~~equal to $1.0 billion. SPV will also have~~of $1.15 billion (the “Term Loan Facility” and proceeds of such facility, the ~~ability from time to time to request additional loans~~“Term Loans”), (y) a revolving credit facility in an aggregate principal amount of $1.15 billion (the “Revolving Loan Facility” and proceeds of such facility, the “Revolving Loans”; the Revolving Loans, collectively with the Term Loans, the “Loans”) and (z) an uncommitted incremental term loan facility in an aggregate principal amount of up to ~~$1.0~~$200 million (collectively, the “Margin Loan Facility”). No additional borrowings under the Margin Loan Agreement were made in connection with the Sixth Amendment. SPV’s obligations under the Margin Loan Facility are secured by shares of Charter owned by SPV. Effective on October 3, 2022, pursuant to Amendment No. 5 to Margin Loan Agreement, an additional 6 million shares of Charter were voluntarily pledged as collateral, which improved the loan to value ratio.

Outstanding borrowings under the Margin Loan Agreement were $1.4 billion onas of both March 31, 2023 and December 31, 2022. As of March 31, 2023, SPV was permitted to borrow an ~~uncommitted basis~~additional $900 million under the Margin Loan Agreement, subject to certain ~~conditions. SPV had borrowed $500 million as of September 30, 2017 and had $500 million available to~~funding conditions, which may be drawn until ~~August 31, 2018.~~five business days prior to the maturity date. The maturity date of the loans under the ~~2017~~ Margin Loan Agreement is ~~August 30, 2019~~May 12, 2024 (except for any ~~incremental~~additional loans incurred thereunder to the extent SPV and the incremental lenders agree to a later maturity date). ~~Accordingly, the debt is classified as noncurrent as of September 30, 2017.~~ Borrowings under the ~~2017~~ Margin Loan Agreement bear interest at the three-month LIBOR rate plus a per annum spread of 1.5%~~, unless it is unlawful for the applicable lender to fund or maintain loans based on LIBOR or there are material restrictions on the applicable lender to do so, in which case borrowings under the 2017~~. The Margin Loan Agreement ~~will either (a) bear interest at 0.5% plus the higher of (i) the federal funds rate plus ½ of 1%, (ii) the prime rate and (iii)~~also provides for customary LIBOR plus 1% for each day during such period or (b) be prepaid. Borrowings outstanding under these margin loans bore interest at a rate of 2.74% per annum at September 30, 2017. Interest is payable quarterly in arrears beginning on September 29, 2017. SPV used available cash and a portion of the proceeds of the loans under the 2017 Margin Loan Facility to repay the Margin Loan Agreements. Borrowings may also be used for distribution as a dividend or a return of capital, for the purchase of margin stock and for general corporate purposes.

replacement provisions.

The ~~2017~~ Margin Loan Agreement contains various affirmative and negative covenants that restrict the activities of SPV (and, in some cases, the Company and its subsidiaries with respect to shares of Charter owned by the Company and its

~~I-16~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(unaudited)~~

subsidiaries). The ~~2017~~ Margin Loan Agreement does not include any financial covenants. The ~~2017~~ Margin Loan Agreement ~~also contains~~does contain restrictions related to additional indebtedness and events of default customary for margin loans of this type.

I-15

Table of Contents

LIBERTY BROADBAND CORPORATION

Notes to Condensed Consolidated Financial Statements

(unaudited)

which was paid on April 17, 2023 to shareholders of record of the Liberty Broadband Preferred Stock at the close of business on March 31, 2023.

(8) Stock-Based Compensation

Liberty Broadband grants, to certain of its directors, employees and employees of its subsidiaries, restricted stock units and stock options to purchase shares of its common stock (collectively, "Awards"). The Company measures the cost of employee services received in exchange for an equity classified Award (such as stock options and restricted stock) based on the grant-date fair value (“GDFV”) of the Award, and recognizes that cost over the period during which the employee is required to provide service (usually the vesting period of the Award). The Company measures the cost of employee services received in exchange for a liability classified Award based on the current fair value of the Award, and ~~remeasures~~re-measures the fair value of the Award at each reporting date.

Included in Selling, general and administrative expenses in the accompanying condensed consolidated statements of operations are ~~the following amounts~~$8 million and $9 million of stock-based compensation ~~for~~during the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2023 and ~~2016 (amounts in thousands):~~

Three months

Nine months

ended

ended

September 30,

September 30,

2017

2016

2017

2016

Operating expense

$
3

4

5

2

Selling, general and administrative

1,429

1,596

4,032

4,363

Research and development

67

136

339

217

$
1,499

1,736

4,376

4,582

2022, respectively.

Liberty Broadband – Grants

During the three months ended March 31, 2023, Liberty Broadband granted 129 thousand options to purchase shares of ~~Stock Options~~Liberty Broadband Series C common stock to our CEO in connection with his employment agreement. Such options had a GDFV of $27.83 per share and vest on December 29, 2023.

There were no options to purchase shares of Liberty Broadband Series A or Series B ~~or Series C~~ common stock granted during the ~~nine~~three months ended ~~September 30, 2017.~~ March 31, 2023.

The Company ~~calculates~~has calculated the GDFV for all of its equity classified ~~awards~~options and any subsequent ~~remeasurement~~re-measurement of its liability classified ~~awards~~options using the Black-Scholes Model. The Company estimates the expected term of the ~~Awards~~options based on historical exercise and forfeiture data. ~~Since Liberty Broadband common stock has not traded on the stock market for a significant length of time, the~~The volatility used in the calculation for ~~Awards~~options is based on ~~a blend of~~ the historical volatility of Liberty Broadband ~~and Charter~~ common stock and the implied volatility of publicly traded Liberty Broadband and Charter options; as the most significant asset within Liberty Broadband, the volatility of Charter was considered in the overall volatility of Liberty Broadband.stock. The Company uses a zero dividend rate and the risk-free rate for Treasury Bonds with a term similar to that of the subject ~~option.~~

options.

~~I-17~~I-19

Table of Contents

LIBERTY BROADBAND CORPORATION

Notes to Condensed Consolidated Financial Statements

(unaudited)

Liberty Broadband – Outstanding Awards

The following ~~tables present~~table presents the number and weighted average exercise price (“WAEP”) of ~~Awards~~options to purchase Liberty Broadband common stock granted to certain officers, employees and directors of the Company, as well as the weighted average remaining life and aggregate intrinsic value of the ~~Awards.~~options.

Weighted



average

remaining

Aggregate

contractual

intrinsic

Series A

WAEP

life

value

(in thousands)

(in years)

(in millions)
Outstanding at January 1, 2017

454

$
32.47

Granted

—

$
—

Exercised

(49)

$
26.85

Forfeited/cancelled

—

$
—

Outstanding at September 30, 2017

405

$
33.15

2.2

$
25
Exercisable at September 30, 2017

402

$
33.06

2.2

$
25


				Weighted
				average
				remaining	Aggregate
				contractual	intrinsic
	Series C	WAEP		life	value
	(in thousands)			(in years)	(in millions)
Outstanding at January 1, 2023	3,602	$	98.62
Granted	129	$	80.19
Exercised	(24)	$	67.24
Forfeited/Cancelled	(29)	$	96.49
Outstanding at March 31, 2023	3,678	$	98.19	3.3	$	51
Exercisable at March 31, 2023	2,382	$	77.46	2.6	$	51

Weighted



average

remaining

Aggregate

contractual

intrinsic

Series C

WAEP

life

value

(in thousands)

(in years)

(in millions)
Outstanding at January 1, 2017

2,467

$
42.45

Granted

—

$
—

Exercised

(94)

$
27.08

Forfeited/cancelled

—

$
—

Outstanding at September 30, 2017

2,373

$
43.06

5.4

$
124
Exercisable at September 30, 2017

851

$
33.59

2.3

$
52

As of ~~September 30, 2017~~,March 31, 2023, there were no outstanding options to purchase shares of Liberty Broadband Series A common stock. During the three months ended March 31, 2023, Liberty Broadband had 69 thousand Liberty Broadband Series B options with a WAEP of $97.21 that were forfeited. As of March 31, 2023, 246 thousand Liberty Broadband Series B options remained outstanding and exercisable at a WAEP of $95.98 and a weighted average remaining contractual life of 1.5 years.

As of March 31, 2023, the total unrecognized compensation cost related to unvested Awards was approximately ~~$11 million~~.$45 million. Such amount will be recognized in the Company's condensed consolidated statements of operations over a weighted average period of approximately 21.4 years.

As of ~~September 30, 2017,~~March 31, 2023, Liberty Broadband reserved ~~2.8~~3.9 million shares of Liberty Broadband Series AB and Series C common stock for issuance under exercise privileges of outstanding stock ~~Awards.~~options.

~~Skyhook Equity Incentive Plans~~

Skyhook issued 3.3 million phantom stock appreciation rights (“PARs”) and no phantom stock units (“PSUs”) during the nine months ended September 30, 2017. As of September 30, 2017, the fair value of outstanding PARs and PSUs was approximately $2.4 million. As of September 30, 2017, $1.6 million (Level 3) is included in Other current liabilities in the accompanying condensed consolidated balance sheet for the fair value of Skyhook’s vested long-term incentive plan obligations.

~~I-18~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(unaudited)~~

~~(8)~~(9) Commitments and Contingencies

~~Leases~~

Skyhook leases various properties under operating leases expiring at various times through 2018. Skyhook’s two principal facilities are under lease through December 2017 and December 2019, respectively. Including amounts due to Liberty under the facilities sharing agreement, the Company’s total rental expense was $368 thousand and $452 thousand for each of the three months ended September 30, 2017 and 2016, respectively, and $890 thousand and $1.0 million for each of the nine months ended September 30, 2017 and 2016, respectively.

General Litigation

InThe Company has contingent liabilities related to legal and tax proceedings and other matters arising in the ordinary course of business, the Company and its consolidated subsidiary are parties to legal proceedings and claims involving alleged infringement of third-party intellectual property rights, defamation, and other claims, including infringement of the intellectual property rights of the Company and its consolidated subsidiary by third parties.business. Although it is reasonably possible ~~that~~ the Company may incur losses upon conclusion of such matters, an estimate of any loss or range of loss cannot be made. In the opinion of management, it is expected that amounts, if any, which may be required to satisfy such contingencies will not be material in relation to the accompanying condensed consolidated financial statements.

~~Indemnification Claims~~

In the normal course of business, Skyhook provides indemnification to certain customers against specified claims that might arise against those customers from the use of Skyhook’s products. To date, Skyhook has not made any significant reimbursements to any of its customers for any losses related to these indemnification provisions. However, four such claims are currently pending. Skyhook is unable to estimate the maximum potential impact of these indemnification provisions on its future results of operations, although Skyhook’s liabilities in certain of those arrangements are customarily limited in various respects, including monetarily. Accordingly, no accrual was recorded related to indemnification claims as of September 30, 2017 or December 31, 2016.

~~Certain Risks and Concentrations~~

The Skyhook business is subject to certain risks and concentrations including dependence on relationships with its customers. The Company’s largest customers, that accounted for greater than 10% of revenue, aggregated 57% and 85% of total revenue for the three months ended September 30, 2017 and 2016, respectively, and 57% and 64% of total revenue for the nine months ended September 30, 2017 and 2016, respectively.

~~Off-Balance Sheet Arrangements~~

Liberty Broadband did not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on the Company’s financial condition, results of operations, liquidity, capital expenditures or capital resources.

~~(9)~~(10) Segment Information

Liberty Broadband identifies its reportable segments as (A) those consolidated companies that represent 10% or more of its consolidated annual revenue, annual Adjusted OIBDA (as defined below) or total assets and (B) those equity method affiliates whose share of earnings or losses represent 10% or more of Liberty Broadband’s annual pre-tax ~~earnings.~~earnings (losses).

Liberty Broadband evaluates performance and makes decisions about allocating resources to its operating segments based on financial measures such as revenue and Adjusted OIBDA. In addition, Liberty Broadband reviews nonfinancial measures such as subscriber growth.

~~I-19~~I-20

Table of Contents

LIBERTY BROADBAND CORPORATION

Notes to Condensed Consolidated Financial Statements

(unaudited)

For the three months ended March 31, 2023, Liberty Broadband has identified the following consolidated company and equity method investment as its reportable segments:

●

GCI Holdings – a wholly owned subsidiary of the Company that provides a full range of data, wireless, video, voice, and managed services to residential, businesses, governmental entities, and educational and medical institutions primarily in Alaska.

●

Charter – an equity method investment that is one of the largest providers of cable services in the United States, offering a variety of entertainment, information and communications solutions to residential and commercial customers.

Liberty Broadband’s operating segments are strategic business units that offer different products and services. They are managed separately because each segment requires different technologies, distribution channels and marketing strategies. The accounting policies of the segment that is also a consolidated company are the same as those described in the Company’s summary of significant accounting policies in the Company’s annual financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. We have included amounts attributable to Charter in the tables below. Although Liberty Broadband owns less than 100% of the outstanding shares of Charter, 100% of the Charter amounts are included in the tables below and subsequently eliminated in order to reconcile the account totals to the Liberty Broadband condensed consolidated financial statements.

Performance Measures

Revenue by segment from contracts with customers, classified by customer type and significant service offerings follows:


	Three months ended
	March 31,
	2023		2022

	amounts in millions
GCI Holdings
Consumer Revenue
Data	$	59	58
Wireless		35	34
Other		12	14
Business Revenue
Data		105	89
Wireless		11	13
Other		5	6
Lease, grant, and revenue from subsidies		19	19
Total GCI Holdings		246	233
Corporate and other		—	5
Total	$	246	238

Charter revenue totaled $13,653 million and $13,200 million for the three months ended March 31, 2023 and 2022, respectively.

The Company had receivables of $184 million and $189 million at March 31, 2023 and December 31, 2022, respectively, the long-term portion of which are included in Other assets, net. The Company had deferred revenue of $35 million and $33 million at March 31, 2023 and December 31, 2022, respectively, the long-term portion of which are included in Other liabilities. The receivables and deferred revenue are only from contracts with customers. GCI Holdings’ customers

I-21

Table of Contents

LIBERTY BROADBAND CORPORATION

Notes to Condensed Consolidated Financial Statements

(unaudited)

generally pay for services in advance of the performance obligation and therefore these prepayments are recorded as deferred revenue. The deferred revenue is recognized as revenue in the accompanying condensed consolidated statements of operations as the services are provided. Changes in the contract liability balance for the Company during the three months ended March 31, 2023 were not materially impacted by other factors.

The Company expects to recognize revenue in the future related to performance obligations that are unsatisfied (or partially unsatisfied) of approximately $162 million in the remainder of 2023, $92 million in 2024, $65 million in 2025, $36 million in 2026 and $42 million in 2027 and thereafter.

For segment reporting purposes, Liberty Broadband defines Adjusted OIBDA as revenue less operating expenses and selling, general and administrative expenses ~~(excluding~~excluding stock-based ~~compensation).~~compensation. Liberty Broadband believes this measure is an important indicator of the operational strength and performance of its businesses ~~including~~by identifying those items that are not directly a reflection of each ~~business’s ability to service debt and fund capital expenditures.~~business’ performance or indicative of ongoing business trends. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. This measure of performance excludes depreciation and amortization, stock-based compensation, transaction costs, separately reported litigation settlements and restructuring and impairment charges that are included in the measurement of operating income pursuant to GAAP. Accordingly, Adjusted OIBDA should be considered in addition to, but not as a substitute for, operating income, net earnings, cash flow provided by operating activities and other measures of financial performance prepared in accordance with GAAP. Liberty Broadband generally accounts for intersegment sales and transfers as if the sales or transfers were to third parties, that is, at current prices.

~~For the nine months ended September 30, 2017, Liberty Broadband has identified the following consolidated subsidiary and equity method investment~~Adjusted OIBDA is summarized as ~~its reportable segments:~~

~~Skyhook—a wholly owned subsidiary of the Company that provides a Wi-Fi based location platform focused on providing positioning technology and contextual location intelligence solutions.~~

Charter—an equity method investment of the Company that is one of the largest providers of cable services in the United States, offering a variety of entertainment, information and communications solutions to residential and commercial customers.

follows:


	Three months ended
	March 31,
	2023		2022

	amounts in millions
GCI Holdings	$	90	87
Charter		5,340	5,212
Corporate and other		(8)	(7)
		5,422	5,292
Eliminate equity method affiliate		(5,340)	(5,212)
Consolidated Liberty Broadband	$	82	80

Other Information


	March 31, 2023
	Total		Investments	Capital
	assets		in affiliate	expenditures

	amounts in millions
GCI Holdings	$	3,361	—	54
Charter		144,870	—	2,464
Corporate and other		11,768	11,609	—
		159,999	11,609	2,518
Eliminate equity method affiliate		(144,870)	—	(2,464)
Consolidated Liberty Broadband	$	15,129	11,609	54

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Table of Contents

LIBERTY BROADBAND CORPORATION

Notes to Condensed Consolidated Financial Statements

(unaudited)

Liberty Broadband’s operating segments are strategic business units that offer different products and services. They are managed separately because each segment requires different technologies, distribution channels and marketing strategies. The accounting policies of the segments that are also consolidated companies are the same as those described in the Company’s summary of significant accounting policies in the Company’s annual financial statements. We have included amounts attributable to Charter in the tables below. Although Liberty Broadband owns less than 100% of the outstanding shares of Charter, 100% of the Charter amounts are included in the schedule below and subsequently eliminated in order to reconcile the account totals to the Liberty Broadband condensed consolidated financial statements.

~~Performance Measures~~

Three months ended  September 30,

2017

2016

Adjusted

Adjusted

Revenue

OIBDA

Revenue

OIBDA

(amounts in thousands)

Skyhook

$
3,430

(980)

20,616

11,422

Charter

10,458,000

3,674,000

10,037,000

3,429,000

Corporate and other

—

(2,366)

—

(2,091)

10,461,430

3,670,654

10,057,616

3,438,331

Eliminate equity method affiliate

(10,458,000)

(3,674,000)

(10,037,000)

(3,429,000)

Consolidated Liberty Broadband

$
3,430

(3,346)

20,616

9,331

Nine months ended September 30,

2017

2016

Adjusted

Adjusted

Revenue

OIBDA

Revenue

OIBDA

(amounts in thousands)

Skyhook

$
9,643

(6,839)

27,413

1,234

Charter

30,979,000

10,946,000

18,728,000

5,963,000

Corporate and other

—

(5,423)

—

(7,170)

30,988,643

10,933,738

18,755,413

5,957,064

Eliminate equity method affiliate

(30,979,000)

(10,946,000)

(18,728,000)

(5,963,000)

Consolidated Liberty Broadband

$
9,643

(12,262)

27,413

(5,936)

~~I-21~~

~~Table of Contents~~

~~LIBERTY BROADBAND CORPORATION~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(unaudited)~~

~~Other Information~~

September 30, 2017

Total

Investments

Capital

assets

in affiliates

expenditures

(amounts in thousands)

Skyhook

$
26,136

—

27

Charter

148,228,000

—

6,096,000

Corporate and other

9,455,758

9,326,871

—

157,709,894

9,326,871

6,096,027

Eliminate equity method affiliate

(148,228,000)

—

(6,096,000)

Consolidated Liberty Broadband

$
9,481,894

9,326,871

27

The following table provides a reconciliation of ~~consolidated segment~~ Adjusted OIBDA to Operating income (loss) and Earnings (loss) before income taxes:


						Three months ended
						March 31,
						2023		2022

	Three months			Nine months
	ended September 30,			ended September 30,
	2017		2016	2017	2016
		(amounts in thousands)
Consolidated segment Adjusted OIBDA	$	(3,346)	9,331	(12,262)	(5,936)
							amounts in millions
Adjusted OIBDA						$	82	80
Stock-based compensation		(1,499)	(1,736)	(4,376)	(4,582)		(8)	(9)
Depreciation and amortization		(942)	(971)	(2,844)	(2,935)		(58)	(64)
Operating income (loss)		(5,787)	6,624	(19,482)	(13,453)		16	7
Interest expense		(5,518)	(4,090)	(14,899)	(10,547)		(45)	(26)
Dividend and interest income		422	190	1,219	4,697
Share of earnings (loss) of affiliates		(5,280)	19,046	25,109	570,178
Share of earnings (loss) of affiliate, net							248	303
Gain (loss) on dilution of investment in affiliate							(27)	(56)
Realized and unrealized gains (losses) on financial instruments, net		2,675	—	5,026	92,990		(114)	137
Gain (loss) on dilution of investment in affiliate		(3,718)	(16,331)	(42,515)	760,074
Other, net		9	5	11	112		14	(21)
Earnings (loss) before income taxes	$	(17,197)	5,444	(45,531)	1,404,051	$	92	344

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Table of Contents

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Certain statements in this Quarterly Report on Form 10-Q constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding ~~our~~ business, product and marketing strategies; new service and product offerings; revenue growth; future expenses; anticipated changes to regulations; the ~~return on~~recognition of deferred revenue; competition; the performance, results of operations and cash flows of our ~~investment in, and performance of,~~equity affiliate, Charter Communications, Inc. (“Charter”); the expansion of Charter’s ~~ongoing integration of its acquired operations; the recoverability of our goodwill and other long-lived assets; our~~network; projected sources and uses of cash; the effects of regulatory developments; the Rural Health Care Program; indebtedness and the anticipated ~~non-material~~ impact of certain contingent liabilities related to legal and tax proceedings and other matters arising in the ordinary course of business. Forward-looking statements inherently involve many risks and uncertainties that could cause actual results to differ materially from those projected in these statements. Where, in any forward-looking statement, we express an expectation or belief as to future results or events, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but such statements necessarily involve risks and uncertainties and there can be no assurance that the expectation or belief will result or be achieved or accomplished. The following include some but not all of the factors ~~(as they relate to our consolidated subsidiary and equity affiliate)~~ that could cause actual results or events to differ materially from those anticipated:

●

our, GCI Holdings, LLC (“GCI Holdings” or “GCI”), GCI, LLC, and Charter’s ability to ~~promptly, efficiently~~obtain cash in sufficient amounts to service financial obligations and ~~effectively integrate acquired operations;~~

meet other commitments;

●

~~the~~our ability ~~of Charter~~ to ~~sustain~~use net operating loss carryforwards and grow revenue and cash flow from operations by offering video, Internet, voice, advertising and other services to residential and commercial customers, to adequately meet the customer experience demands in its markets and to maintain and grow its customer base, particularly in the face of increasingly aggressive competition, the need for innovation and the related capital expenditures;

disallowed business interest carryforwards;

●

our, GCI Holdings, GCI, LLC and Charter’s ability to obtain additional financing, or refinance existing indebtedness, on acceptable terms;

●

the impact of ~~competition from other market participants, including but not limited~~our, GCI Holdings, GCI, LLC and Charter’s significant indebtedness and the ability to ~~incumbent telephone companies, direct broadcast satellite operators, wireless broadband~~comply with any covenants in our and ~~telephone providers, digital subscriber line providers, fiber to the home providers, video provided over the Internet~~ by (i) market participants that have not historically competed in the multichannel video business, (ii) traditional multichannel video distributors, and (iii) content providers that have historically licensed cable networks to multichannel video distributors, ~~and providers of advertising over the Internet;~~

their respective debt instruments;

●

general business conditions, ~~economic uncertainty or downturn, high~~ unemployment levels, ~~and~~ the level of activity in the housing ~~sector;~~

sector, economic uncertainty or downturn and inflationary pressures on input costs and labor;

●

~~Charter’s ability to obtain programming at reasonable prices or to raise prices to offset, in whole or in part, the effects of higher programming costs (including retransmission consents);~~

competition faced by GCI Holdings and Charter;

●

the ~~development~~ability of GCI Holdings and ~~deployment of new products~~Charter to acquire and ~~technologies, including wireless products, Charter’s cloud-based user interface, Spectrum Guide~~®~~, and downloadable security for set top boxes and any other cloud-based consumer services and service platforms;~~

retain subscribers;

●

~~failure to protect~~ the ~~security~~impact of ~~personal information about the customers of our operating subsidiary~~governmental legislation and ~~equity affiliate, subjecting us to costly government enforcement actions or private litigation and reputational damage;~~

~~changes in, or failure or inability to comply with, government regulations,~~regulation including, without limitation, regulations of the Federal Communications Commission (the "FCC"), on GCI Holdings and Charter, their ability to comply with regulations, and adverse outcomes from regulatory proceedings;

●

changes in the ~~effects~~amount of ~~governmental regulation~~data used on ~~our business or potential business combination transactions~~ ~~including costs, disruptions~~the networks of GCI Holdings and possible limitations on Charter’s operating flexibility related to, and its ability to comply with, regulatory conditions applicable to Charter as a result of the Time Warner Cable Merger and the Bright House Transaction (each as defined below and collectively, the “Transactions”);

Charter;

●

~~any events that disrupt Charter’s networks, information systems or properties and impair its operating activities and negatively impact its reputation;~~

the ability of ~~suppliers~~third-party providers to supply equipment, services, software or licenses;

●

the ability of GCI Holdings and ~~vendors~~Charter to ~~deliver~~respond to new technology and meet customer demands for new products ~~equipment, software~~ and services;

●

changes in customer demand for the products and services of GCI Holdings and Charter and their ability to adapt to changes in demand;

●

the ability of GCI Holdings and Charter to license or enforce intellectual property rights;

●

natural or man-made disasters, terrorist attacks, armed conflicts, pandemics, cyberattacks, network disruptions, service interruptions and system failures and the impact of related uninsured liabilities;

●

the ability to hire and retain key personnel;

●

the ability to procure necessary services and equipment from GCI Holdings’ and Charter’s vendors in a timely manner and at reasonable costs including in connection with Charter’s network evolution and rural construction initiatives;

●

risks related to the Investment Company Act of 1940;

●

the outcome of any pending or threatened litigation;

and

~~I-23~~I-24

Table of Contents

~~changes in the nature of key strategic relationships with partners, vendors and joint venturers;~~

●

~~the availability~~changes to general economic conditions, including economic conditions in Alaska, and ~~access, in general, of funds to meet debt obligations prior to or when they become due~~their impact on potential customers, vendors and ~~to fund operations and necessary capital expenditures, either through (i) cash on hand, (ii) free cash flow, or (iii) access to the capital or credit markets;~~

third parties.

the ability of Charter and our company to comply with all covenants in our respective debt instruments, any violation of which, if not cured in a timely manner, could trigger a default of other obligations under cross-default provisions;

~~our ability to successfully monetize certain of our assets; and~~

~~the ability to retain and hire key personnel.~~

For additional risk factors, please see Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2022. These forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this Quarterly Report, and we expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein, to reflect any change in our expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based.

The following discussion and analysis provides information concerning our results of operations and financial condition. This discussion should be read in conjunction with our accompanying condensed consolidated financial statements and the notes ~~thereto. Additionally, see note 1 to~~thereto and our Annual Report on Form 10-K for the accompanying condensed consolidated financial statements for an overview of new accounting standards that we have adopted or that we plan to adopt that have had or may have an impact on our financial statements.year ended December 31, 2022.

Overview

During May 2014, the board of directors of Liberty Media Corporation and its subsidiaries (“Liberty”) authorized management to pursue a plan to spin-off to its stockholders common stock of a wholly-owned subsidiary, Liberty Broadband Corporation (“Liberty ~~Broadband”~~Broadband,” “the Company,” “us,” “we,” or ~~the “Company”~~“our”), is primarily comprised of GCI Holdings, a wholly owned subsidiary, and ~~to distribute subscription rights to acquire shares of~~an equity method investment in Charter.

On December 18, 2020, GCI Liberty, ~~Broadband’s Series C common stock (the “Broadband Spin-Off”~~Inc. (“GCI Liberty”)~~. At the time of the Broadband Spin-Off,~~ was merged with Liberty Broadband ~~was comprised~~(the “Combination”) and Liberty Broadband acquired GCI Holdings. Through a number of ~~(i) Liberty’s former~~prior years’ transactions, including the Combination, Liberty Broadband has acquired an interest in Charter Communications, Inc. (“Legacy Charter”), (ii) Liberty’s former wholly-owned subsidiary TruePosition, Inc., (iii) Liberty’s former minority equity investment in Time Warner Cable, Inc. (“Time Warner Cable”, “TWC”, or “Legacy TWC”), (iv) certain deferred tax liabilities, as well as liabilities related to the Time Warner Cable written call options and (v) initial indebtedness, pursuant to margin loans entered into prior to the completion of the Broadband Spin-Off. The Broadband Spin-Off was accounted for at historical cost due to the pro rata nature of the distribution to holders of Liberty common stock.

On May 18, 2016, Time Warner Cable merged with Legacy Charter (the “Time Warner Cable Merger”). In connection with the Time Warner Cable Merger, Legacy Charter underwent a corporate reorganization, resulting in CCH I, LLC, a former subsidiary of Legacy Charter (“Charter”), becoming the new publicly traded parent company. Also on May 18, 2016, the previously announced acquisition of Bright House Networks, LLC (“Bright House”) from Advance/Newhouse Partnership (“A/N”) by Charter (the “Bright House Transaction”) was completed. In connection with the Time Warner Cable Merger and Bright House Transaction, Liberty Broadband entered into certain agreements with Legacy Charter, Charter, Liberty Interactive Corporation (“Liberty Interactive”) and Time Warner Cable. In connection with the Time Warner Cable Merger and Bright House Transaction, Liberty Broadband exchanged its shares of Time Warner Cable for shares of Charter and purchased additional shares of Charter. ~~As a result, and pursuant to proxy agreements entered into with Liberty Interactive and A/N,~~ Liberty Broadband controls 25.01% of the aggregate voting power of Charter. ~~In addition,~~

Update on Economic Conditions

GCI Holdings

GCI Holdings offers wireless and wireline telecommunication services, data services, video services, and managed services to customers primarily throughout Alaska. Because of this geographic concentration, growth of GCI Holdings’ business and operations depends upon economic conditions in ~~connection with~~Alaska. Mounting inflationary cost pressures and recessionary fears have negatively impacted the ~~Time Warner Cable Merger, Liberty Broadband funded~~U.S. and global economy. Unfavorable economic conditions, such as a recession or economic slowdown in the U.S., or inflation in the markets in which GCI operates, could negatively affect the affordability of and demand for GCI’s products and services and its ~~purchase~~cost of ~~shares of Charter Class A common stock using proceeds of $4.4 billion related to subscriptions for approximately 78.3 million newly issued shares of Liberty Broadband Series C common stock.~~doing business.

The ~~Company’s wholly owned subsidiary, Skyhook Holding, Inc. (formerly known~~Alaska economy is dependent upon the oil industry, state and federal spending, investment earnings and tourism. A decline in oil prices would put significant pressure on the Alaska state government budget. The Alaska state government has significant reserves that GCI Holdings believes will help fund the state government for the next couple of years. The Alaska economy is subject to recessionary pressures as TruePosition, Inc.), was originally incorporated to provide technology for locating wireless phones and other mobile devices through a passive network overlay system using its patented U-TDOA technology (“U-TDOA service”). In February 2014, Skyhook Holding, Inc. acquired 100% of the outstanding common shares of Skyhook Wireless, Inc., which operates a global location network containing billions of geolocated Wi-Fi access points and cell towers that serve as the reference infrastructure for providing

~~I-24~~

~~Table of Contents~~

location services. In 2015, one of Skyhook Holding, Inc.’s customers, a wireless carrier utilizing the legacy U-TDOA service which accounted for approximately 80% - 90% of consolidated revenue at the time, gave notice that it planned to discontinue use of the U-TDOA service and did not intend to renew its contract, which expired on December 31, 2015. The loss of this customer had a material adverse effect on Skyhook Holding, Inc.’s business. As a result of the ~~loss~~economic impacts of ~~this wireless carrier customer, further changes~~the COVID-19 pandemic, volatility in oil prices, inflation, and other causes that could result in a decrease in economic activity. While it is difficult for GCI Holdings to predict the future impact of a recession on its business, these conditions have had an adverse impact on its business and could adversely affect the affordability of and demand for some of its products and services and cause customers to shift to lower priced products and services or to delay or forgo purchases of its products and services. GCI Holdings’ customers may not be able to obtain adequate access to credit, which could affect their ability to make timely payments to GCI Holdings and could lead to an increase in accounts receivable and bad debt expense. If a recession occurs, it could negatively affect GCI Holdings’ business including its financial position, results of operations, or liquidity, as well as its ability to service debt, pay other obligations and enhance shareholder returns.

In addition, during 2022 and continuing in 2023, GCI Holdings began to experience the impact of inflation-sensitive items, including upward pressure on the costs of materials, labor, and other items that are critical to GCI Holding’s business. GCI Holdings continues to monitor these impacts closely and, if costs continue to rise, GCI Holdings may be unable to recoup losses or offset diminished margins by passing these costs through to its customers or implementing offsetting cost reductions.

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Rural Health Care (“RHC”) Program

GCI Holdings receives support from various Universal Service Fund ("USF") programs including the RHC Program. The USF programs are subject to change by regulatory actions taken by the FCC, interpretations of or compliance with USF program rules, or legislative actions. Changes to any of the USF programs that GCI Holdings participates in could result in a material decrease in revenue and accounts receivable, which could have an adverse effect on GCI Holdings’ business and the Company’s financial position, results of operations or liquidity. The following paragraphs describe certain separate matters related to the RHC Program that impact or could impact the revenue earned by the Company. As of March 31, 2023, the Company had net accounts receivable from the RHC Program of approximately $86 million, which is included within Trade and other receivables in the ~~regulatory environment and a shift~~condensed consolidated balance sheets.

The Company disclosed, in additional detail, the following items related to GCI Holdings’ involvement in the ~~overall market~~RHC Program in its Annual Report on Form 10-K for the ~~legacy U-TDOA~~year ended December 31, 2022:

FCC Rate Reduction

●

The FCC reduced the rates charged to RHC customers by approximately 26% for the funding year that ended June 30, 2018. An Application for Review is currently with the FCC.

●

The FCC approved the cost-based rural rates GCI Holdings historically applied for the funding years that ended on June 30, 2019 and June 30, 2020. GCI Holdings collected $175 million in accounts receivable relating to these two funding years during 2021. GCI Holdings also filed an Application for Review of these determinations. GCI Holdings identified rates for similar services provided by a competitor that would justify higher rates for certain GCI Holdings satellite services in the funding years that ended on June 30, 2018, June 30, 2019, and June 30, 2020. GCI Holdings submitted that information to the FCC’s Wireline Competition Bureau on September 7, 2021. The Applications for Review remain pending.

●

On May 24, 2021, the FCC approved the cost studies submitted by GCI Holdings for the funding year ended June 30, 2021. Subsequently, on August 16, 2021, GCI Holdings submitted a request for approval of rates for 17 additional sites, 13 of which the FCC approved on December 22, 2022. The rest remain pending.

RHC Program Funding Cap

●

The RHC Program has a funding cap for each individual funding year that is annually adjusted for inflation, and which the FCC can increase by carrying forward unused funds from prior funding years. In recent years, including the current funding year, this funding cap has not limited the amount of funding received by participants; however, management continues to monitor the funding cap and its potential impact on funding in future years.

Enforcement Bureau and Related Inquiries

●

GCI Holdings received a letter of inquiry and request for information from the Enforcement Bureau (the “Enforcement Bureau”) of the FCC, in March 2018 relating to the period beginning January 1, 2015 and including all future periods.

●

In the fourth quarter of 2019, GCI Holdings became aware of potential RHC Program compliance issues related to certain of its currently active and expired contracts with certain of its RHC customers.

●

On December 17, 2020, GCI Holdings received a Subpoena Duces Tecum from the FCC’s Office of the Inspector General requiring production of documents from January 1, 2009 to the present related to a single RHC customer and related contracts, information regarding GCI Holdings’ determination of rural rates for a single customer, and to provide information regarding persons with knowledge of pricing practices generally.

●

In 2021, GCI Holdings was informed that a qui tam action had been filed in the Western District of Washington arising from the subject matter under review by the Enforcement Bureau. The Department of Justice (the “DOJ”) is investigating whether GCI Holdings submitted false claims and/or statements in connection with GCI’s participation in the FCC’s RHC Program. Additionally in 2021, the DOJ issued a Civil Investigative Demand with regard to the qui tam action.

●

With respect to the ongoing inquiries from the FCC’s Enforcement Bureau and the FCC’s Office of the Inspector General, GCI Holdings recognized a liability of approximately $12 million in 2019 for contracts that were deemed

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probable of not complying with the RHC Program rules. During the year ended December 31, 2022, GCI Holdings recorded an additional estimated settlement expense of $15 million relating to a settlement offer made by GCI Holdings resulting in a total estimated liability of $27 million. GCI Holdings also identified certain contracts where additional loss was reasonably possible and such loss could range from zero to $30 million. An accrual was not made for the amount of the reasonably possible loss in accordance with the applicable accounting guidance. GCI Holdings could also be assessed fines and penalties but such amounts could not be reasonably estimated.

●

The DOJ and GCI Holdings held discussions regarding the qui tam action whereby the DOJ clarified that its investigation relates to the years from 2010 through 2019 and alleged that GCI Holdings had submitted false claims under the RHC Program during this time period. GCI Holdings continues to work with the DOJ related to this matter and has recorded a $14 million estimated settlement expense during the year ended December 31, 2022 to reflect discussions and settlement offers that GCI Holdings made to the DOJ during 2022. However, the Company is unable to assess the ultimate outcome of this action and is unable to reasonably estimate any range of additional possible loss beyond the $14 million estimated settlement liability, including any type of fine or penalty that may ultimately be assessed as permitted under the applicable law.

●

Separately, during the third quarter of 2022, GCI Holdings became aware of possible RHC Program compliance issues relating to potential conflicts of interest identified in the historical competitive bidding process with respect to certain of its contracts with its RHC customers. GCI Holdings notified the FCC’s Enforcement Bureau of the potential compliance issues; however, the Company is unable to assess the ultimate outcome of the potential compliance issues and is unable to reasonably estimate any range of loss or possible loss.

Revision of Support Calculations

●

The FCC released an Order adopting changes to the RHC Program that will revise the manner in which support issued under the RHC Program will be calculated and approved. On January 19, 2021, the Wireline Competition Bureau of the FCC issued an Order that waives the requirement to use the database for health care providers in Alaska for the two funding years ending June 30, 2022 and June 30, 2023. The Order requires GCI Holdings to determine its rural rates based on previously approved rates or under reinstitution of the rules currently in effect through the funding year ended on June 30, 2021. On April 8, 2021, the Wireline Competition Bureau issued an Order further extending the January 19, 2021 waiver to carriers nationwide and eliminating the ability or requirement to use the database to establish the healthcare provider payments for services subsidized by the RHC Telecom Program. On April 12, 2022 and May 25, 2022, the Bureau issued Orders further extending the January 19, 2021 and April 8, 2021 waivers regarding use of the database by health care providers seeking support under the RHC Program through the funding year ending June 30, 2024. On January 26, 2023, the FCC adopted an Order on Reconsideration, Report and Order, and Second Further Notice of Proposed Rulemaking, which grants the petitions challenging the rates database, returns the RHC Telecom Program to the rate determination rules in place prior to the adoption of the rates database, permits providers to determine rural rates based on previously approved rates through the funding years ending June 30, 2025 and June 30, 2026, and seeks comment on future revisions to the rate determination rules.

The Company does not have any significant updates regarding the items noted above.

Charter

Charter is a leading broadband connectivity company and cable operator serving more than 32 million customers in 41 states through its Spectrum brand.

During the first quarter of 2023, Charter added 686,000 mobile lines, 76,000 Internet customers and 16,000 residential and small and medium business customer relationships, which excludes mobile-only customers. Charter’s Spectrum One offering, which brings together Spectrum Internet, Advanced WiFi and Unlimited Spectrum Mobile to offer consumers fast, reliable and secure online connections on their favorite devices at home and on-the-go in a high-value package, contributed to Charter’s increase in mobile lines in the first quarter. Charter continues to see lower customer move rates and switching behavior among providers, which has reduced its selling opportunities. Charter is beginning to see benefits from the targeted investments it is making in employee wages and benefits inside of its operations to build employee skill sets and tenure, as well as the continued investments in digitization of Charter’s customer service ~~Skyhook Holding, Inc. ceased making further investment in~~platforms and proactive

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maintenance, all with the goal of improving the customer experience, reducing transactions and driving customer growth and retention.

Charter spent $391 million on its ~~U-TDOA products. In 2016, Skyhook Holding, Inc. and Skyhook Wireless, Inc. combined operations in order to focus on~~subsidized rural construction initiative during the ~~development and sale of the suite of location and context products, and are referred to collectively herein as “Skyhook.”~~

~~The financial information represents a consolidation of the historical financial information of Skyhook, Liberty Broadband’s interest in~~three months ended March 31, 2023. Charter Liberty Broadband’s former minority equity investment in Time Warner Cable and certain deferred tax liabilities. This financial information refers to the consolidation of the aforementioned subsidiary, investments, and financial instruments, as “Liberty Broadband,” “the Company,” “us,” “we” and “our” hereexpects that over time, its subsidized rural construction initiative will support customer growth, and in the ~~notes~~first quarter of 2023, Charter activated approximately 44,000 subsidized rural passings. In addition, Charter continues to evolve and upgrade its network to provide higher Internet speeds and reliability and invest in its products and customer service platforms. By continually improving its product set and offering consumers the opportunity to save money by switching to its services, Charter believes it can continue to penetrate its expanding footprint and capture more spend on additional products for its existing customers.

Other

Skyhook Holdings, Inc. (“Skyhook”) was a wholly owned subsidiary of Liberty Broadband until its sale on May 2, 2022 for aggregate consideration of approximately $194 million, including amounts held in escrow of approximately $23 million. Liberty Broadband recognized a gain on the sale of $179 million, net of closing fees, in the second quarter of 2022. Skyhook is included in Corporate and other through April 30, 2022 and is not presented as a discontinued operation as the sale did not represent a strategic shift that had a major effect on Liberty Broadband’s operations and financial results.

Results of Operations — Consolidated —March 31, 2023 and 2022

General. We provide information regarding our consolidated operating results and other income and expenses, as well as information regarding the contribution to those items from our reportable segments in the tables below. The "Corporate and other" category consists of those assets or businesses which do not qualify as a separate reportable segment. See note 10 to the accompanying condensed consolidated financial ~~statements.~~statements for more discussion regarding our reportable segments. For a more detailed discussion and analysis of GCI Holdings’ results, see "Results of Operations-GCI Holdings" below.

~~I-25~~

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~~Results of Operations—Consolidated—September 30, 2017 and 2016~~

Consolidated operating results:

Three months ended

Nine months ended

September 30,

September 30,

2017

2016

2017

2016

(amounts in thousands)

Revenue

$
3,430

20,616

9,643

27,413

Operating expense

643

778

1,963

2,097

Research and development

1,373

2,248

5,875

7,823

Selling, general and administrative

4,760

8,259

14,067

23,429

Stock-based compensation

1,499

1,736

4,376

4,582

Depreciation and amortization

942

971

2,844

2,935

Operating income (loss)

(5,787)

6,624

(19,482)

(13,453)

Less impact of stock-based compensation and depreciation and amortization

2,441

2,707

7,220

7,517

Adjusted OIBDA

$
(3,346)

9,331

(12,262)

(5,936)


	Three months ended
	March 31,
	2023		2022

	amounts in millions
Revenue
GCI Holdings	$	246	233
Corporate and other		—	5
Consolidated	$	246	238

Operating Income (Loss)
GCI Holdings	$	29	21
Corporate and other		(13)	(14)
Consolidated	$	16	7

Adjusted OIBDA
GCI Holdings	$	90	87
Corporate and other		(8)	(7)
Consolidated	$	82	80

Revenue

Revenue ~~decreased $17.2 million and $17.8~~increased $8 million for the three ~~and nine~~ months ended ~~September 30, 2017, respectively,~~March 31, 2023, as compared to the ~~same periods in the~~corresponding prior ~~year.~~year period. The ~~decrease~~increase in revenue was primarily due to increased revenue from GCI Holdings. See “Results of Operations – GCI Holdings, LLC” below for ~~both~~a more complete discussion of the results of operations of GCI Holdings.

I-28

Table of Contents

Revenue for Corporate and other decreased for the three ~~and nine~~ months ended ~~September 30, 2017,~~March 31, 2023, as compared to the ~~same periods in the~~corresponding prior year period. With the sale of Skyhook in May 2022, Corporate and other revenue was ~~due to a new license agreement entered into~~minimal during ~~2016 with no similar event occurring~~the first half of 2022 and will be zero in 2017. On September 1, 2016, Skyhook entered into a license agreement pursuant to which Skyhook agreed to grant to the licensee a perpetual, non-exclusive, non-transferable, worldwide license to patentsfuture periods as all Corporate and ~~patent applications owned~~other revenue was generated by ~~the companies. In exchange~~Skyhook.

Operating Income (Loss)

Consolidated operating income improved $9 million for ~~this grant, the licensee agreed to pay a one-time lump sum payment of $17.5 million that was recognized as revenue during~~ the three months ended ~~September 30, 2016.~~

~~Operating expense, research and development, and selling, general and administrative expenses~~

~~Operating expense decreased by $135 thousand and $134 thousand for the three and nine months ended September 30, 2017, respectively,~~March 31, 2023, as compared to the ~~same periods in the~~corresponding prior ~~year. Research~~year period. Operating loss for Corporate and ~~development expense decreased by $875 thousand and $1.9~~other improved $1 million for the three ~~and nine~~ months ended ~~September 30, 2017, respectively,~~March 31, 2023, as compared to the ~~same periods in the~~corresponding prior year ~~primarily~~period, due to decreased professional service fees.

Operating income increased $8 million at GCI Holdings for the three months ended March 31, 2023, as ~~a result of headcount reductions and other cost containment measures taken by Skyhook related~~compared to the ~~run-off~~corresponding prior year period. See “Results of Operations – GCI Holdings, LLC” below for a more complete discussion of the ~~U-TDOA business. Selling, general, and administrative~~results of operations of GCI Holdings.

Stock-based compensation

Stock-based compensation expense decreased ~~by $3.5 million and $9.4~~$1 million for the three ~~and nine~~ months ended ~~September 30, 2017, respectively,~~March 31, 2023, as compared to the ~~same periods in the~~corresponding prior year primarily as a result of headcount reductions and other cost containment measures taken by Skyhook related to the run-off of the U-TDOA business coupled with reduced legal expenses of $1.3 million and $3.5 million, respectively, compared to the same periods in the prior year. Legal expenses in the current year have not been as significant due to a decrease in activity associated with license sales in the current period.

~~Stock-based compensation~~

The decrease in stock-based compensation expense ~~of $237 thousand and $206 thousand for the three and nine months ended September 30, 2017, respectively, as compared to the corresponding periods in the prior year, were~~was primarily due to ~~adjustments made to certain outstanding awards~~a decrease in ~~2016 which increased their value, partially offset by additional grants of awards, and~~Liberty Broadband’s allocation rate per the ~~ongoing vesting of outstanding grants.~~

~~Depreciation and amortization~~

~~Depreciation and amortization expense decreased by $29 thousand and $91 thousand during the three and nine months ended September 30, 2017, respectively,~~services agreement arrangement as ~~compared~~described in note 1 to the ~~corresponding periods in the prior year, due to certain assets becoming fully depreciated.~~accompanying condensed consolidated financial statements.

~~I-26~~

~~Table of Contents~~

~~Operating income (loss)~~

Operating loss increased $12.4 million and $6.0 million for the three and nine months ended September 30, 2017, respectively, as compared to the same periods in the prior year due to the items discussed above.

Adjusted OIBDA

To provide investors with additional information regarding our financial results, we also disclose Adjusted OIBDA, which is a non-GAAP financial measure. We define Adjusted OIBDA as ~~revenue less~~ operating ~~expenses~~income (loss) plus depreciation and ~~selling, general~~amortization, stock-based compensation, transaction costs, separately reported litigation settlements, restructuring, and ~~administrative expenses (excluding stock-based compensation).~~impairment charges. Our chief operating decision maker and management team use this measure of performance in conjunction with other measures to evaluate our businesses and make decisions about allocating resources among our businesses. We believe this is an important indicator of the operational strength and performance of our businesses ~~including~~by identifying those items that are not directly a reflection of each ~~business’s ability to service debt and fund capital expenditures.~~business’ performance or indicative of ongoing business trends. In addition, this measure allows us to view operating results, perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. This measure of performance excludes such costs as depreciation and amortization, stock-based compensation, separately reported litigation settlements and restructuring and impairment charges that are included in the measurement of operating income pursuant to generally accepted accounting principles in the United States (“GAAP”). Accordingly, Adjusted OIBDA should be considered in addition to, but not as a substitute for, operating income, net income, cash flow provided by operating activities and other measures of financial performance prepared in accordance with ~~GAAP. See note 9 to the accompanying condensed consolidated financial statements for~~U.S. generally accepted accounting principles. The following table provides a reconciliation of ~~Adjusted OIBDA to~~ Operating income (loss) ~~and Earnings (loss) before income taxes.~~to Adjusted OIBDA.


	Three months ended
	March 31,
	2023		2022

		amounts in millions
Operating income (loss)	$	16	7
Depreciation and amortization		58	64
Stock-based compensation		8	9
Adjusted OIBDA	$	82	80

Adjusted OIBDA ~~decreased $12.7~~improved $2 million ~~and $6.3 million during the three and nine months ended September 30, 2017, respectively, as compared to the same periods in the prior year. Adjusted OIBDA~~ for the three months ended September 30, 2017 and 2016, includes $2.4 million and $2.1 million of corporate selling, general and administrative costs, respectively. Adjusted OIBDA for the nine months ended September 30, 2017 and 2016, includes $5.4 million and $7.2 million of corporate selling, general and administrative costs, respectively. The decrease in corporate selling, general and administrative costs for the nine months ended September 30, 2017, as compared to same periods in the prior year, was primarily due to decreased legal expenses. Legal expenses decreased in the current year due to legal expenses associated with the Transactions in 2016. The decrease in Skyhook Adjusted OIBDA for the three and nine months ended September 30, 2017,March 31, 2023, as compared to the corresponding ~~periods in the~~ prior year ~~was~~period, primarily due to increased Adjusted OIBDA at GCI Holdings. See “Results of Operations – GCI Holdings, LLC” below for a more complete discussion of the ~~new license agreement entered into during the three months ended September 30, 2016, partially offset by lower operating expenses as discussed above.~~results of operations of GCI Holdings.

I-29

Table of Contents

Other Income and Expense

Components of Other income (expense) are presented in the table below.


	Three months ended
	March 31,
	2023		2022

	amounts in millions
Other income (expense):
Interest expense	$	(45)	(26)
Share of earnings (losses) of affiliate		248	303
Gain (loss) on dilution of investment in affiliate		(27)	(56)
Realized and unrealized gains (losses) on financial instruments, net		(114)	137
Other, net		14	(21)
	$	76	337

Three months ended

Nine months ended

September 30,

September 30,

2017

2016

2017

2016

(amounts in thousands)

Other income (expense):










Interest expense

$
(5,518)

(4,090)

(14,899)

(10,547)

Dividend and interest income

422

190

1,219

4,697

Share of earnings (losses) of affiliates

(5,280)

19,046

25,109

570,178

Realized and unrealized gains (losses) on financial instruments, net

2,675

—

5,026

92,990

Gain (loss) on dilution of investment in affiliate

(3,718)

(16,331)

(42,515)

760,074

Other, net

9

5

11

112

$
(11,410)

(1,180)

(26,049)

1,417,504

~~I-27~~

~~Table of Contents~~

Interest expense

Interest expense increased ~~$1.4 million and $4.4~~$19 million during the three ~~and nine~~ months ended ~~September 30, 2017, respectively,~~March 31, 2023, as compared to the corresponding ~~periods~~period in the prior year. The increase was ~~primarily~~driven by higher interest rates on our variable rate debt, partially offset by lower amounts outstanding on the Margin Loan Facility (as defined in note 6 to the accompanying condensed consolidated financial statements). The interest rates on our fixed rate debt also increased with the closing of the 3.125% Exchangeable Senior Debentures due 2053 (the “3.125% Debentures”) and repurchase of other exchangeables, as further described in note 6 to ~~an increase in LIBOR during~~ the ~~current periods as compared to corresponding periods in the prior year.~~accompanying condensed consolidated financial statements.

~~Dividend and interest income~~Share of earnings (losses) of affiliate

~~Dividend and interest income increased $232 thousand and~~Share of earnings of affiliate decreased ~~$3.5~~$55 million during the three ~~and nine~~ months ended ~~September 30, 2017, respectively,~~March 31, 2023, as compared to the corresponding ~~periods in the prior year. The increase in dividend and interest income for the three months ended September 30, 2017, as compared to the same~~ period in the prior year, was the result of increased interest income due to higher short-term marketable securities rates during the third quarter of 2017, partially offset by lower cash balances. The decrease in dividend and interest income for the nine months ended September 30, 2017, as compared to the same period in the prior year, was the result of a loss of dividend income due to the Time Warner Cable Merger during May 2016.

~~Share of earnings (losses) of affiliates~~

~~Share of earnings of affiliates decreased $24.3 million and $545.1 million during the three and nine months ended September 30, 2017, respectively, as compared to the corresponding periods~~ in the prior year. The Company’s ~~Share~~share of earnings (losses) of ~~affiliates~~affiliate line item in the accompanying condensed consolidated statements of operations includes expenses of ~~$15.3~~$69 million and ~~$18.5~~$67 million, net of related taxes, for the three months ended ~~September 30, 2017~~March 31, 2023 and ~~2016, respectively, and expenses of $44.0 million and $23.2 million for the nine months ended September 30, 2017 and 2016,~~2022, respectively, due to the increase in amortization ~~related to~~of the excess basis of assets with identifiable useful lives and ~~debt.~~debt, which was primarily due to Charter’s share buyback program. The decrease in the share of earnings of ~~affiliates~~affiliate in the three ~~and nine~~ months ended ~~September 30, 2017,~~March 31, 2023, as compared to the ~~same periods~~corresponding period in the prior year, was ~~primarily~~ the result of the ~~Time Warner Cable Merger and related transactions during May 2016 (see note 4 to the accompanying condensed consolidated financial statements).~~corresponding decrease in net income at Charter.

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Table of Contents

The following is a discussion of Charter’s results of operations. Beginning in the first quarter of 2023, Charter changed its presentation of its mobile business, among several other changes, to better reflect the converged and integrated nature of its business and operations, which altered the way they group revenue and expenses. In order to provide a better understanding of Charter’s operations, we have included a summarized presentation of Charter’s results from ~~operations, as well as pro forma information for the period ended September 30, 2016 as if the Transactions had been completed on January 1, 2015.~~ operations.



							Three months ended
							March 31,
							2023		2022

						Pro Forma
	Three months ended			Nine months ended		Nine months ended
	September 30,			September 30,		September 30,
	2017		2016	2017	2016	2016
	(amounts in millions)
							amounts in millions
Revenue	$	10,458	10,037	30,979	18,728	29,748	$	13,653	13,200
Operating expenses, excluding stock-based compensation		(6,784)	(6,608)	(20,033)	(12,765)			(8,313)	(7,988)
Adjusted OIBDA		3,674	3,429	10,946	5,963	10,092		5,340	5,212
Depreciation and amortization		(2,701)	(2,437)	(7,846)	(4,412)			(2,206)	(2,294)
Stock-based compensation		(64)	(81)	(198)	(168)			(208)	(147)
Operating income		909	911	2,902	1,383	2,813		2,926	2,771
Other expenses, net		(791)	(645)	(2,305)	(1,342)			(1,369)	(1,037)
Net earnings (loss) before income taxes		118	266	597	41
Income tax benefit (expense)		(26)	(16)	(99)	3,135
Net earnings (loss)	$	92	250	498	3,176
Net income (loss) before income taxes								1,557	1,734
Income tax (expense) benefit								(374)	(345)
Net income (loss)								1,183	1,389
Less: Net income attributable to noncontrolling interests								(162)	(186)
Net income (loss) attributable to Charter shareholders							$	1,021	1,203

Charter net ~~earnings~~income decreased ~~$158 million and $2,678~~$206 million for the three ~~and nine~~ months ended ~~September 30, 2017, respectively,~~March 31, 2023, as compared to the corresponding ~~periods~~period in the prior year.

Charter’s revenue increased ~~$421 million and $12,251~~$453 million for the three ~~and nine~~ months ended ~~September 30, 2017, respectively,~~March 31, 2023, as compared to the corresponding ~~periods~~period in the prior year, primarily due to pass-through of programming cost increases to video customers and other price adjustments and increases in the number of residential mobile and Internet ~~and commercial business customers as well as price adjustments, offset by a decrease in basic video~~

~~I-28~~

~~Table of Contents~~

~~customers and advertising sales, and in the nine month period~~customers. Additionally, revenue increased due to product mix and higher mobile device sales.

During the ~~Transactions which increased total revenue by approximately $11.4 billion. On a pro forma basis, assuming the Transactions occurred as of January 1, 2015, total revenue growth was 4.1% for the nine~~three months ended ~~September 30, 2017,~~March 31, 2023, operating expenses, excluding stock-based compensation, increased $325 million, as compared to the corresponding period in ~~2016.~~

~~The increase in revenue during~~ the three and nine months ended September 30, 2017 was partially offset by the net impact of an increase in operating expenses, excluding stock-based compensation of $176 million and $7,268 million, respectively. The increase in operating expenses was primarily attributable to the Transactions.prior year. Operating costs ~~also~~ increased primarily due to higher mobile device sales and higher other mobile direct costs due to an increase in mobile lines, as well as increased costs to service customers and higher corporate labor costs. The increased costs to service customers was primarily due to adjustments to job structure, pay and benefits to build a more skilled and longer tenured workforce resulting in lower frontline employee attrition compared to 2022, and additional activity to support the accelerated growth of Spectrum Mobile.

These increases in operating costs were partially offset by decreased programming costs as a result of fewer video customers and a higher mix of lower cost video packages within Charter’s video customer base partly offset by contractual rate adjustments, including renewals and increases in amounts paid for retransmission consents, higher expanded basic package customers and higher pay-per-view events, offset by synergies as a result of the Transactions. Charter expects programming expenses to continue to increase in future periods due to a variety of factors, including annual increases imposed by programmers with additional selling power as a result of media consolidation, increased demands by owners of broadcast stations for payment for retransmission consent or linking carriage of other services to retransmission consent, and additional programming, particularly new services. Charter ~~does not expect to be able to fully pass the cost increases on to its customers without a potential loss of customers.~~

consent.

Charter’s Adjusted OIBDA increased $128 million for the three ~~and nine~~ months ended ~~September 30, 2017 increased~~March 31, 2023, as ~~a result of~~compared to the ~~discussion above. On a pro forma basis, Charter’s Adjusted OIBDA increased by $854 million~~corresponding period in the prior year, for the nine months ended September 30, 2017, as a result of the discussion above, offset by increases in programming, marketing and transition costs which was offset by decreases in all other operating expense categories.

reasons described above.

Depreciation and amortization expense ~~increased $264 million and $3,434~~decreased $88 million during the three ~~and nine~~ months ended ~~September 30, 2017, respectively,~~March 31, 2023, as compared to the same periods in the prior year. The increase in depreciation and amortization expense was primarily the result of higher capital expenditures in the current year, as well as additional depreciation and amortization related to the Transactions, inclusive of the incremental amounts as a result of the higher fair values recorded in acquisition accounting. Stock-based compensation expense decreased $17 million and increased $30 million during the three and nine months ended September 30, 2017, respectively, compared to the same periodscorresponding period in the prior year, primarily due to ~~the Transactions.~~

~~Charter’s results were also impacted~~certain assets acquired in acquisitions becoming fully depreciated offset by an increase in ~~other~~depreciation as a result of more recent capital expenditures.

Other expenses, net ~~of $146 million and $963~~increased $332 million for the three ~~and nine~~ months ended ~~September 30, 2017, respectively.~~March 31, 2023, as compared to the corresponding period in the prior year. The increase in other expenses, net was primarily due to ~~(i) decreases~~increased interest expense caused by an increase in weighted average interest rates, as well as an increase in weighted average debt outstanding, and increased losses on financial instruments and equity investments.

I-31

Table of ~~$30~~Contents

Income tax expense increased $29 million ~~and $524 million in other pension benefits~~ for the three months ~~and nine months~~ ended September 30, 2017 and 2016, respectively, and (ii) $64 million and $479 million of additional interest expense that was recognized during the three and nine months ended September 30, 2017, respectively, in each case,March 31, 2023, as compared to the ~~same~~corresponding period in the prior year. Income tax expense increased primarily as a result of decreased recognition of excess tax benefits resulting from share-based compensation partly offset by lower pretax income.

Gain (loss) on dilution of investment in affiliate

The ~~decrease~~loss on dilution of investment in ~~other pension benefits~~affiliate decreased by $29 million during the three months ended ~~September 30, 2017,~~March 31, 2023, as compared to the corresponding period in the prior year, primarily due to a decrease in issuance of Charter common stock from the exercise of stock options and restricted stock units held by employees and other third parties, partially offset by a smaller gain on dilution related to Charter’s repurchase of Liberty Broadband’s Charter shares.

Realized and unrealized gains (losses) on financial instruments, net

Realized and unrealized gains (losses) on financial instruments, net are comprised of changes in the fair value of the following:


	Three months ended
	March 31,
	2023		2022

	amounts in millions
Indemnification obligation	$	(3)	85
Exchangeable senior debentures		(111)	52
	$	(114)	137

The changes in these accounts are primarily due to market factors and changes in the fair value of the underlying stocks or financial instruments to which these related (see notes 3 and 6 to the accompanying condensed consolidated financial statements for additional discussion). The increase in realized and unrealized losses for the three months ended March 31, 2023, compared to the corresponding period in the prior year, was primarily due to ~~a third quarter 2017 remeasurement~~an increase in unrealized losses on the indemnification obligation, as ~~a result~~well as the change in fair value of ~~significant lump sum settlement payments~~the 3.125% Debentures related to ~~participants. The decrease~~changes in ~~other pension benefits during~~market price of underlying Charter stock.

Other, net

Other, net income increased $35 million for the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2023, as compared to the corresponding period in the prior year, was primarily as a result of a $675 million pension curtailment gain offset by an $157 million net remeasurement loss recognized in 2016 that resulted from an amendment to the plans made subsequent to the Time Warner Cable Merger.year. The increase ~~in interest expense that~~ was recognized during the three and nine months ended September 30, 2017, respectively, as compared to the same period in the prior year, was associated with debt assumed from Legacy TWC and an increase in weighted average debt outstanding primarily due to ~~the issuance~~a tax sharing receivable with Qurate Retail that resulted in an increased gain of ~~notes in 2017.~~

~~Income tax expense increased $10~~$31 million and $3,234 million for the three and nine months ended September 30, 2017, respectively, as compared to the corresponding periods in the prior year. Income tax expense for the three and nine months ended September 30, 2017, was reduced by approximately $17 million and $88 million, respectively, due to the recognition of excess tax benefits resulting from share based compensation as a component of the provision for income taxes following the prospective application of Accounting Standard Update 2016-09. Income tax expense for the three months ended ~~September 30, 2016 was also impacted by a change in a state~~March 31, 2023. See more discussion about the tax law that resulted in approximately $44 million of tax benefit. Income tax benefit for the nine months ended September 30, 2017 was a result of a reduction of substantially all of Legacy Charter’s preexisting valuation allowance associatedsharing agreement with its deferred tax assets of approximately $3.3 billion as certain of the deferred tax liabilities that were assumed in connection with the closing of the Time Warner Cable Merger will reverse and provide a source of future taxable income.

~~I-29~~

~~Table of Contents~~

~~Realized and unrealized gains (losses) on financial instruments, net~~

Realized and unrealized gains on financial instruments, net declined $2.7 million and $88.0 million for the three and nine months ended September 30, 2017, respectively, as compared to the corresponding periods in the prior year. The realized gains during the three and nine months ended September 30, 2017 were related to the zero-strike call options (see discussionQurate Retail in note 31 to the accompanying condensed consolidated financial ~~statements). During the three months ended September 30, 2016, there were no net realized or unrealized gains~~statements.

Income taxes

Earnings (losses) ~~as we exited the derivative~~before income taxes and Time Warner Cable shares were exchanged for Charter shares during the second quarter of 2016. The net realized and unrealized gain of $93.0 million for the nine months ended September 30, 2016, was attributable to gains in the fair value of our investment in Time Warner Cable, due to increases in the Time Warner Cable stock price during the period.

~~Gain (loss) on dilution of investment in affiliate~~

The loss on dilution of investment in affiliate improved $12.6 million during the three months ended September 30, 2017, as compared to the same period in the prior year, primarily due to a decrease of issuances of Charter common stock from the exercise of stock options held by employees and other third parties, at prices below Liberty Broadband’s book basis per share. The loss on dilution of investment in affiliate declined $802.6 million during the nine months ended September 30, 2017, as compared to the same period in the prior year, primarily due to the Company’s increased basis in Charter as a result of the Transactions during 2016, along with an increase in issuance of Charter common stock from the exercise of stock options held by employees and other third parties, at prices below Liberty Broadband’s book basis per share. As Liberty Broadband’s ownership in Charter changes due to exercises of Charter warrants and stock options, a loss is recorded with the effective sale of common stock, because the exercise price of Charter warrants or stock options is typically lower than the book value of the Charter shares held by Liberty Broadband.

~~Other, net~~

Other, net during the three and nine months ended September 30, 2017 is primarily attributable to a gain on the sale of certain fixed assets at Skyhook during the year, partially offset by tax penalties. Other, net during the three and nine months ended September 30, 2016 was attributable to a gain on the sale of shares of a certain Skyhook cost investment.

~~Income tax benefit (expense)~~

~~During the three and nine months ended September 30, 2017, we had an~~ income tax (expense) benefit of $7.3 million and $18.2 million, respectively, and the effective rate was approximately 42.6% and 40.1%, respectively. For the three and nine months ended September 30, 2016, we had an income tax expense of $1.7 million and $532.3 million, respectively, and the effective tax rate was approximately 30.4% and 37.9%, respectively. are as follows:


	Three months ended
	March 31,
	2023		2022

	amounts in millions
Earnings (loss) before income taxes	$	92	344
Income tax (expense) benefit		(23)	(45)
Effective income tax rate		25%	13%

The difference between the effective income tax rate of ~~42.6%~~25% and the U.S. Federal income tax rate of ~~35%~~21% for the three months ended ~~September 30, 2017 is~~March 31, 2023 was primarily due to the effect of state income taxes and ~~unrealized gain attributable~~the recognition of excess tax benefits and shortfalls related to ~~the Company’s own stock which is not recognized for tax purposes.~~ stock-based compensation.

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Table of Contents

The difference between the effective income tax rate of ~~40.1%~~13% and the U.S. Federal income tax rate of 35% for the nine months ended September 30, 2017, is primarily due to the effect of state income taxes and unrealized gain attributable to the Company’s own stock which is not recognized for tax purposes. The difference between the effective income tax rate of 30.4% and the U.S. Federal income tax rate of 35%21% for the three months ended ~~September 30, 2016 is~~March 31, 2022 was primarily due to deferred tax benefits recognized related to tax basis in the ~~effect~~stock of ~~state~~a consolidated subsidiary sold during the second quarter of 2022 and non-taxable income ~~taxes.~~ from a decrease in the fair value of the indemnification payable owed to Qurate Retail.

Net earnings (loss)

The ~~difference between the effective income tax rate~~Company had net earnings of ~~37.9%~~$69 million and ~~the U.S. Federal income tax rate of 35%~~$299 million for the ~~nine~~three months ended ~~September 30, 2016 is primarily due to~~March 31, 2023 and 2022, respectively. The change in net earnings (loss) was the ~~effect~~result of ~~state~~the above-described fluctuations in our revenue, expenses and other income ~~taxes.~~and expenses.

Liquidity and Capital Resources

As of ~~September 30, 2017,~~March 31, 2023, substantially all of our cash and cash equivalents are invested in U.S. Treasury securities, other government securities or government guaranteed funds, AAA rated money market funds and other highly rated financial and corporate debt instruments.

The following are potential sources of liquidity: available cash balances, cash generated by the operating activities of our privately-owned subsidiaries (to the extent such cash exceeds the working capital needs of the ~~subsidiaries)~~subsidiaries and is not otherwise restricted), ~~proceeds from asset sales,~~ monetization of our investments (including Charter Repurchases (as defined in note 4 to the accompanying condensed consolidated financial statement and discussed below)), outstanding or anticipated debt ~~borrowings,~~facilities (as described in note 6 to the accompanying condensed consolidated financial statements), debt and equity issuances, and dividend and interest receipts.

~~I-30~~

~~Table of Contents~~

As of ~~September 30, 2017,~~March 31, 2023, Liberty Broadband had a cash and cash equivalents balance of ~~$135~~$169 million.

Nine months ended September 30,

2017

2016

(amounts in thousands)

Cash flow information






Net cash provided (used) by operating activities

$
(23,596)

(5,033)

Net cash provided (used) by investing activities

$
(13)

(4,990,687)

Net cash provided (used) by financing activities

$
(46,694)

4,599,682


	Three months ended March 31,
	2023		2022

	amounts in millions
Cash flow information
Net cash provided by (used in) operating activities	$	41	90
Net cash provided by (used in) investing activities	$	(12)	574
Net cash provided by (used in) financing activities	$	(235)	(548)

The ~~increase~~decrease in cash ~~used~~provided by operating activities in the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2023, as compared to the ~~same~~corresponding period in the prior year, was primarily driven by ~~the increase in operating loss, as well as the~~ timing of differences in ~~cash receipts and payments.~~working capital accounts, partially offset by increased operating income.

During the ~~nine~~three months ended ~~September 30, 2016,~~March 31, 2023 and 2022, net cash flows ~~from~~used in investing activities were primarily related to ~~transactions~~capital expenditures of $54 million and $32 million, respectively. This net outflow of cash was offset by the sale of 120,149 and 970,241 shares of Charter Class A common stock to Charter for $42 million and $602 million during the three months ended March 31, 2023 and 2022, respectively, to maintain our fully diluted ownership percentage of Charter at 26%. In February 2021, Liberty Broadband entered into a letter agreement in ~~connection~~order to implement, facilitate and satisfy the terms of the Stockholders Agreement with respect to the ~~Time Warner Cable Merger and the Bright House Transaction, as discussed~~Equity Cap (see more information in note 4 ofto the accompanying condensed consolidated financial ~~statements.~~statements). The Company expects the Charter Repurchases to be a significant source of liquidity in future periods.

During the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2023, net cash flows ~~from~~used in financing activities were primarily ~~related to~~for the ~~net debt repayments~~repurchase of ~~$103~~approximately $1,415 million ~~and settlement~~in principal amount of outstanding exchangeable senior debentures, partially offset by the issuance of $1,265 million aggregate original principal amount of the ~~zero-strike call options~~3.125% Debentures (see ~~notes 3 and~~more information in note 6 to the accompanying condensed consolidated financial statements).

~~During the nine months ended September 30, 2016,~~ Additionally, net cash flows ~~from~~used in financing activities ~~were primarily related to the Company’s issuance of $4.4 billion in additional shares~~included repurchases of Liberty Broadband Series A and Series C common stock of $40 million and indemnification payments of $24 million made by Liberty Broadband to ~~purchase $4.3 billion~~Qurate Retail in ~~shares~~connection with the LI LLC 1.75% Exchangeable Debentures. During the three months ended March 31, 2022, net cash flows used in financing activities were primarily

I-33

Table of ~~New Charter, in addition to net~~Contents

repurchases of Liberty Broadband Series A and Series C common stock of $843 million, partially offset by borrowings of ~~$200.0~~debt of $300 million of outstanding Revolving Loans (as defined in note 6 to the accompanying condensed consolidated financial statements) under ~~two margin loan agreements, entered into on March 21, 2016, between a subsidiary of~~ the ~~Company and the lenders thereto.~~ Margin Loan Facility.

The projected ~~use~~uses of our cash ~~will be primarily to fund~~for the remainder of 2023 are the potential buyback of common stock under the approved share buyback program, net capital expenditures of approximately $130 million, approximately $155 million for interest payments on outstanding debt, approximately $10 million for preferred stock dividends, funding of any operational needs of our ~~subsidiary,~~subsidiaries, to ~~service debt,~~pay accrued litigation settlements, to reimburse Liberty Media Corporation for amounts due under various agreements and to fund potential investment ~~opportunities, and refinance Liberty Broadband’s margin loans that come due in 2019.~~opportunities. We expect ~~our potential~~corporate cash and other available sources of liquidity ~~(discussed above) and corporate cash~~ to cover corporate expenses for the foreseeable future.

Results of Operations—GCI Holdings, LLC

GCI Holdings provides a full range of data, wireless, video, voice, and ~~future obligations.~~ managed services to residential, businesses, governmental entities, and educational and medical institutions primarily in Alaska. The following table highlights selected key performance indicators used in evaluating GCI Holdings.


	March 31,
	2023	2022
Consumer
Data:
Cable modem subscribers¹	159,100	153,600
Wireless:
Wireless lines in service²	193,700	185,900

¹A cable modem subscriber is defined by the purchase of cable modem service regardless of the level of service purchased. If one entity purchases multiple cable modem service access points, each access point is counted as a subscriber. Data cable modem subscribers as of March 31, 2023 include 1,100 subscribers that were reclassified from GCI Business to GCI Consumer subscribers in the first quarter of 2023 and are not new additions.

² A wireless line in service is defined as a wireless device with a monthly fee for services. Wireless lines in service as of March 31, 2023 include 1,400 lines that were reclassified from GCI Business to GCI Consumer lines in the first quarter of 2023 and are not new additions.

GCI Holdings’ operating results for the three months ended March 31, 2023 and 2022 are as follows:


	Three months ended
	March 31,
	2023		2022

	amounts in millions
Revenue	$	246	233
Operating expenses (excluding stock-based compensation included below):
Operating expense		(62)	(63)
Selling, general and administrative expenses		(94)	(83)
Adjusted OIBDA		90	87
Stock-based compensation		(3)	(3)
Depreciation and amortization		(58)	(63)
Operating income (loss)	$	29	21

~~I-31~~I-34

Table of Contents

Revenue

The components of revenue are as follows:


	Three months ended
	March 31,
	2023		2022

	amounts in millions
Consumer
Data	$	59	58
Wireless		47	46
Other		12	15
Business
Data		106	90
Wireless		13	14
Other		9	10
Total revenue	$	246	233

Consumer data revenue increased $1 million for the three months ended March 31, 2023 as compared to the corresponding prior year period. The increase was primarily driven by an increase in the number of subscribers.

Consumer wireless revenue increased $1 million for the three months ended March 31, 2023 as compared to the corresponding prior year period. The increase was primarily driven by an increase in the number of subscribers.

Consumer other revenue decreased $3 million for the three months ended March 31, 2023 as compared to the corresponding prior year period. Consumer other revenue consists of consumer video and voice revenue. The decrease was due to a decrease in video revenue primarily driven by decreased video subscribers. This was the result of both the transition from traditional linear video delivery to IP delivery and GCI Holdings’ decision to discontinue selling bulk video packages for multi-dwelling units. Historically, GCI Holdings has seen declines in video and voice subscribers and revenue and expects a continued decrease as customers potentially choose alternative services.

Business data revenue increased $16 million for the three months ended March 31, 2023 as compared to the corresponding prior year period, primarily due to increased sales to health care and school customers due to service upgrades as well as new customer growth. These increases were partially offset by decreases in professional services revenue, driven by a reduction in time and material project work.

Business wireless revenue decreased $1 million for the three months ended March 31, 2023 as compared to the corresponding prior year period. The decrease was primarily due to decreases in roaming revenue.

Business other revenue decreased $1 million for the three months ended March 31, 2023 as compared to the corresponding prior year period. Business other revenue consists of business video and voice revenue. The decrease was primarily due to decreased local and long distance voice revenue. Historically, GCI Holdings has seen declines in video and voice subscribers and revenue and has not focused business efforts on growth in these areas.

Operating expenses decreased $1 million for the three months ended March 31, 2023 as compared to the corresponding prior year period, primarily due to a decrease in costs paid to content producers driven by reduced video subscribers.

Selling, general and administrative expenses increased $11 million for the three months ended March 31, 2023 as compared to the corresponding prior year period, primarily due to increases in labor related costs and increases in bad debt and property taxes. The increase in bad debt and property taxes is due to one-time decreases in these costs during the quarter ended March 31, 2022.

I-35

Table of Contents

Stock-based compensation remained flat for the three months ended March 31, 2023 as compared to the corresponding prior year period.

Depreciation and amortization decreased $5 million for the three months ended March 31, 2023 as compared to the corresponding prior year period. The decrease was due to lower depreciation expense as certain assets became fully depreciated during 2022.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are exposed to market risk in the normal course of business due to our ongoing investing and financial activities. Market risk refers to the risk of loss arising from adverse changes in stock prices and interest rates. The risk of loss can be assessed from the perspective of adverse changes in fair values, cash flows and future earnings. We have established policies, procedures and internal processes governing our management of market risks and the use of financial instruments to manage our exposure to such risks.

We are exposed to changes in interest rates primarily as a result of our borrowing and investment activities, which could include investments in fixed and floating rate debt instruments and borrowings used to maintain liquidity and to fund business operations. The nature and amount of our long-term and short-term debt are expected to vary as a result of future requirements, market conditions and other factors. We ~~expect to~~ manage our exposure to interest rates by ~~achieving~~maintaining what we believe is an appropriate mix of fixed and variable rate debt. We believe this best protects us from interest rate risk. We ~~anticipate achieving~~could achieve this mix by (i) issuing fixed rate debt that we believe has a low stated interest rate and significant term to maturity, (ii) issuing variable rate debt with appropriate maturities and interest rates ~~and/or~~and (iii) entering into interest rate swap arrangements when we deem appropriate.

Liberty Broadband’s borrowings under the Margin Loan Agreement (as defined in note 6 of the accompanying condensed consolidated financial statements) and the Senior Credit Facility (as defined in note 6 of the accompanying condensed consolidated financial statements) carry a variable interest rate based on LIBOR as a benchmark for establishing the rate of interest. LIBOR is the subject of national, international and other regulatory guidance and proposals for reform. In 2017, the United Kingdom's Financial Conduct Authority (the “FCA”), which regulates LIBOR, announced that it intends to phase out LIBOR. On March 5, 2021, the FCA announced that all LIBOR settings will either cease to be provided by any administrator or no longer be representative: (a) immediately after December 31, 2021, in the case of the one week and two month U.S. dollar settings; and (b) immediately after June 30, 2023, in the case of the remaining U.S. dollar settings. The United States Federal Reserve has also advised banks to cease entering into new contracts that use USD LIBOR as a reference rate. The Alternative Reference Rate Committee, a committee convened by the Federal Reserve that includes major market participants, has identified the Secured Overnight Financing Rate (“SOFR”), an index calculated by short-term repurchase agreements, backed by Treasury securities, as its preferred alternative rate for LIBOR. Our Margin Loan Agreement and Senior Credit Facility provide for a transition to a SOFR based rate or to other alternative reference rates depending on acceptance in the market of these rates.

As of ~~September 30, 2017,~~March 31, 2023, our debt is comprised of the following amounts:


	Variable rate debt				Fixed rate debt
	Principal		Weighted avg		Principal		Weighted avg
	amount		interest rate		amount		interest rate

	dollar amounts in millions
GCI Holdings	$	401	6.5	%	$	600	4.8	%
Corporate and other	$	1,400	6.7	%	$	1,267	3.1	%

Variable rate debt

Fixed rate debt

Principal

Weighted avg

Principal

Weighted avg

amount

interest rate

amount

interest rate

(dollar amounts in millions)

$
500

2.7%

$
—

NA

Our ~~stock~~investment in Charter (our equity method affiliate) is publicly traded and not reflected at fair value in our balance sheet. Our investment in Charter is also subject to market risk that is not directly reflected in our financial statements.

~~We are exposed to changes in stock prices primarily as a result~~I-36

Table of our significant holdings in publicly traded securities. We continually monitor changes in stock markets, in general, and changes in the stock prices of our holdings, specifically. We believe that changes in stock prices can be expected to vary as a result of general market conditions, technological changes, specific industry changes and other factors. We periodically use equity collars and other financial instruments to manage market risk associated with certain investment positions. These instruments are recorded at fair value based on option pricing models.Contents

Item 4. Controls and Procedures

In accordance with Rules 13a-15 and 15d-15 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), the Company carried out an evaluation, under the supervision and with the participation of management, including its chief executive officer and its principal accounting and financial officer (the "Executives"), and under the oversight of its Board of Directors, of the effectiveness of the design and operation of its disclosure controls and procedures as of ~~the end of the period covered by this report.~~March 31, 2023. Based on that evaluation, the Executives concluded that the Company's disclosure controls and procedures were effective as of ~~September 30, 2017~~March 31, 2023 to provide reasonable assurance that information required to be disclosed in its reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange ~~Commission's~~Commission’s rules and forms.

There has been no change in the Company's internal control over financial reporting that occurred during the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2023 that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting.

~~I-32~~I-37

Table of Contents

PART II—OTHER INFORMATION

Item 1. Legal Proceedings

Our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2022 includes "Legal Proceedings" under Item 3 of Part I. ~~Other than as described in Part II, Item 1. Legal Proceedings of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, there~~There have been no material changes from the legal proceedings described in our Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Share Repurchase Programs

A summary of the repurchase activity for the three months ended March 31, 2023 is as follows:


	Series A Common Stock			Series C Common Stock
							Total Number	Maximum Number
							of Shares	(or Approximate Dollar
							Purchased as	Value) of Shares that
	Total Number	Average		Total Number	Average		Part of Publicly	May Yet Be Purchased
	of Shares	Price Paid per		of Shares	Price Paid per		Announced Plans or	Under the Plans or
Period	Purchased	Share		Purchased	Share		Programs	Programs
January 1 - 31, 2023	283,449	$	85.15	37,975	$	79.43	321,424		$1,974	million
February 1 - 28, 2023	38,518	$	92.88	98,620	$	92.82	137,138		$1,962	million
March 1 - 31, 2023	—	$	-	—	$	-	—		$1,962	million
Total	321,967			136,595			458,562

There were no repurchases of Liberty Broadband Series A, B ~~or C~~ common stock or Liberty Broadband Preferred Stock during the ~~period.~~three months ended March 31, 2023.

During the three months ended ~~September 30, 2017, no~~March 31, 2023, 29 shares of Liberty Broadband Series A orcommon stock, zero shares of Liberty Broadband Series B common stock, 106 shares of Liberty Broadband Series C common stock and zero shares of Liberty Broadband Preferred Stock were surrendered by ~~certain of~~ our officers and employees to pay withholding taxes and other deductions in connection with the vesting of their restricted ~~stock.~~

stock, restricted stock units and options.

II-1

Table of Contents

Item 6. Exhibits

(a)

Exhibits

Listed below are the exhibits which are filed as a part of this Report (according to the number assigned to them in Item 601 of Regulation S-K):


~~10.1~~
31.1		Margin Loan Agreement, dated as of August 31, 2017, among LBC Cheetah 6, LLC, as Borrower, various lenders and Bank of America, N.A., as Calculation Agent and Bank of America, N.A., as Administrative Agent.*
~~31.1~~		Rule 13a-14(a)/15d-14(a) Certification*
31.2		Rule 13a-14(a)/15d-14(a) Certification*
32		Section 1350 Certification**
101.INS		XBRL Instance Document* - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document*
101.CAL		Inline XBRL Taxonomy Calculation Linkbase Document*
101.LAB		Inline XBRL Taxonomy Label Linkbase Document*
101.PRE		Inline XBRL Taxonomy Presentation Linkbase Document*
101.DEF		Inline XBRL Taxonomy Definition Document*
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)*

*Filed herewith

**Furnished herewith

II-2

Table of Contents

~~SIGNATURES~~

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	LIBERTY BROADBAND CORPORATION

Date: ~~November 1, 2017~~May 2, 2023	By:	/s/ GREGORY B. MAFFEI
		Gregory B. Maffei President and Chief Executive Officer

Date: ~~November 1, 2017~~May 2, 2023	By:	/s/ ~~MARK D. CARLETON~~BRIAN J. WENDLING
		~~Mark D. Carleton~~Brian J. Wendling Chief ~~Financial Officer~~ ~~(Principal Financial~~Accounting Officer and Principal ~~Accounting Officer)~~Financial Officer

II-3


State of Delaware		47-1211994
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

12300 Liberty Boulevard Englewood, Colorado		80112
(Address of principal executive offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Series A common stock	LBRDA	The Nasdaq Stock Market LLC
Series C common stock	LBRDK	The Nasdaq Stock Market LLC
Series A Cumulative Redeemable preferred stock	LBRDP	The Nasdaq Stock Market LLC


Large ~~accelerated filer~~ Accelerated Filer ☒		Accelerated ~~filer~~ Filer ☐		Non-accelerated ~~filer~~ Filer ☐ ~~(do not check if smaller~~ ~~reporting company)~~		Smaller ~~reporting company~~ Reporting Company ☐		Emerging ~~growth company~~ Growth Company ☐


~~Series A common stock~~		~~26,301,479~~
~~Series B common stock~~		~~2,455,179~~
~~Series C common stock~~		~~153,089,705~~

f
	Page No
Item 1. Financial Statements
LIBERTY BROADBAND CORPORATION Condensed Consolidated Balance Sheets (unaudited)	I-2
LIBERTY BROADBAND CORPORATION Condensed Consolidated Statements of Operations (unaudited)	~~I-3~~I-4
LIBERTY BROADBAND CORPORATION Condensed Consolidated Statements of Comprehensive Earnings (Loss) (unaudited)	~~I-4~~I-5
LIBERTY BROADBAND CORPORATION Condensed Consolidated Statements of Cash Flows (unaudited)	~~I-5~~
~~LIBERTY BROADBAND CORPORATION Condensed Consolidated Statement of Equity (unaudited)~~	I-6
LIBERTY BROADBAND CORPORATION Condensed Consolidated Statements of Equity (unaudited)	I-7
LIBERTY BROADBAND CORPORATION Notes to Condensed Consolidated Financial Statements (unaudited)	~~I-7~~I-8

Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations	~~I-23~~I-24
Item 3. 3. Quantitative and Qualitative Disclosures about Market Risk	~~I-32~~I-36
Item 4. 4. Controls and Procedures	~~I-32~~I-37

Part II - Other Information

Item 1. 1. Legal Proceedings	II-1
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds	II-1
Item 6. 6. Exhibits	II-2

SIGNATURES	II-3


	September 30,		December 31,
	2017		2016
	(amounts in thousands)
Assets
Current assets:
Cash and cash equivalents	$	135,425	205,728
Trade and other receivables, net		2,233	878
Derivative instruments		—	49,019
Other current assets		4,319	2,794
Total current assets		141,977	258,419
Investment in Charter, accounted for using the equity method (note 4)		9,326,871	9,315,253
Property and equipment, net		425	710
Goodwill (note 5)		6,497	6,497
Intangible assets subject to amortization, net (note 5)		6,063	8,596
Other assets, at cost, net of accumulated amortization		61	1,485
Total assets	$	9,481,894	9,590,960
Liabilities and Equity
Current liabilities:
Accounts payable and accrued liabilities	$	4,963	7,931
Deferred revenue		6,684	2,171
Current portion of debt (note 6)		—	400,000
Other current liabilities		553	2,014
Total current liabilities		12,200	412,116
Debt (note 6)		496,975	198,512
Deferred income tax liabilities		497,414	504,644
Deferred revenue		3,765	2,596
Other liabilities		1,305	—
Total liabilities		1,011,659	1,117,868
Equity
Preferred stock, $.01 par value. Authorized 50,000,000 shares; no shares issued		—	—
Series A common stock, $.01 par value. Authorized 500,000,000 shares; issued and outstanding 26,301,387 shares at September 30, 2017 and 26,251,533 shares at December 31, 2016		262	262
Series B common stock, $.01 par value. Authorized 18,750,000 shares; issued and outstanding 2,455,179 shares at September 30, 2017 and 2,467,509 shares at December 31, 2016		25	25
Series C common stock, $.01 par value. Authorized 500,000,000 shares; issued and outstanding 153,089,705 shares at September 30, 2017 and 153,019,547 shares at December 31, 2016		1,531	1,530
Additional paid-in capital		7,952,316	7,945,883
Accumulated other comprehensive earnings, net of taxes		8,290	7,656
Retained earnings		507,811	517,736
Total equity		8,470,235	8,473,092
Commitments and contingencies (note 8)
Total liabilities and equity	$	9,481,894	9,590,960


							Accumulated
						Additional	other
	Preferred		Common stock			paid-in	comprehensive	Retained
	Stock		Series A	Series B	Series C	capital	earnings	earnings	Total equity
	(amounts in thousands)
Balance at January 1, 2017	$	—	262	25	1,530	7,945,883	7,656	517,736	8,473,092
Net earnings (loss)		—	—	—	—	—	—	(27,286)	(27,286)
Other comprehensive earnings		—	—	—	—	—	634	—	634
Stock-based compensation		—	—	—	—	4,017	—	—	4,017
Issuance of common stock upon exercise of stock options		—	—	—	1	2,416	—	—	2,417
Cumulative effect of accounting change at Charter (note 4)		—	—	—	—	—	—	17,361	17,361
Balance at September 30, 2017	$	—	262	25	1,531	7,952,316	8,290	507,811	8,470,235


	Liberty Broadband Common Stock
	Three months	Three months
	ended	ended
	March 31, 2023	March 31, 2022

	(numbers of shares in millions)
Basic WASO	146	167
Potentially dilutive shares (1)	1	2
Diluted WASO	147	169


	Liberty Broadband Common Stock
	Three months	Three months	Nine months	Nine months
	ended	ended	ended	ended
	September 30, 2017	September 30, 2016	September 30, 2017	September 30, 2016
	(numbers of shares in thousands)
Basic WASO	181,846	181,621	181,795	142,170
Potentially dilutive shares (1)	1,485	970	1,369	666
Diluted WASO	183,331	182,591	183,164	142,836



~~Volatility~~		~~21.1%~~
~~Interest rate~~		~~1.3%~~
~~Dividend yield~~		~~0.0%~~


	September 30, 2017		December 31, 2016
Current assets	$	4,132	3,300
Property and equipment, net		33,300	32,963
Goodwill		29,554	29,509
Intangible assets, net		79,905	81,924
Other assets		1,337	1,371
Total assets	$	148,228	149,067
Current liabilities		10,419	9,572
Deferred income taxes		26,576	26,665
Long-term debt		66,064	59,719
Other liabilities		2,591	2,745
Equity		42,578	50,366
Total liabilities and shareholders’ equity	$	148,228	149,067


	September 30, 2017				December 31, 2016
	Gross			Net	Gross		Net
	Carrying		Accumulated	Carrying	Carrying	Accumulated	Carrying
	Amount		Amortization	Amount	Amount	Amortization	Amount
Acquired patents	$	10,823	(9,633)	1,190	10,823	(8,450)	2,373
Customer relationships		10,213	(6,463)	3,750	10,213	(5,440)	4,773
Tradename		2,838	(1,809)	1,029	2,838	(1,528)	1,310
Capitalized software		857	(763)	94	850	(710)	140
	$	24,731	(18,668)	6,063	24,724	(16,128)	8,596


				Weighted
				average
				remaining	Aggregate
				contractual	intrinsic
	Series A	WAEP		life	value
	(in thousands)			(in years)	(in millions)
Outstanding at January 1, 2017	454	$	32.47
Granted	—	$	—
Exercised	(49)	$	26.85
Forfeited/cancelled	—	$	—
Outstanding at September 30, 2017	405	$	33.15	2.2	$	25
Exercisable at September 30, 2017	402	$	33.06	2.2	$	25


	Three months ended September 30,
	2017			2016
			Adjusted		Adjusted
	Revenue		OIBDA	Revenue	OIBDA
		(amounts in thousands)
Skyhook	$	3,430	(980)	20,616	11,422
Charter		10,458,000	3,674,000	10,037,000	3,429,000
Corporate and other		—	(2,366)	—	(2,091)
		10,461,430	3,670,654	10,057,616	3,438,331
Eliminate equity method affiliate		(10,458,000)	(3,674,000)	(10,037,000)	(3,429,000)
Consolidated Liberty Broadband	$	3,430	(3,346)	20,616	9,331


	Nine months ended September 30,
	2017			2016
			Adjusted		Adjusted
	Revenue		OIBDA	Revenue	OIBDA
	(amounts in thousands)
Skyhook	$	9,643	(6,839)	27,413	1,234
Charter		30,979,000	10,946,000	18,728,000	5,963,000
Corporate and other		—	(5,423)	—	(7,170)
		30,988,643	10,933,738	18,755,413	5,957,064
Eliminate equity method affiliate		(30,979,000)	(10,946,000)	(18,728,000)	(5,963,000)
Consolidated Liberty Broadband	$	9,643	(12,262)	27,413	(5,936)


	September 30, 2017
	Total		Investments	Capital
	assets		in affiliates	expenditures
	(amounts in thousands)
Skyhook	$	26,136	—	27
Charter		148,228,000	—	6,096,000
Corporate and other		9,455,758	9,326,871	—
		157,709,894	9,326,871	6,096,027
Eliminate equity method affiliate		(148,228,000)	—	(6,096,000)
Consolidated Liberty Broadband	$	9,481,894	9,326,871	27



Variable rate debt			Fixed rate debt
Principal		Weighted avg	Principal		Weighted avg
amount		interest rate	amount		interest rate
(dollar amounts in millions)
$	500	2.7%	$	—	NA

Liberty Broadband Corporation common stock