CHTR - Earnings call transcript Q3 2019 | Charter Communications, Inc.

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Operator

Good morning. My name is Jessa, and I will be your conference operator today. At this time, I would like to welcome everyone to Charter’s Third Quarter 2019 Investor Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. you. Thank Instructions] [Operator

your begin conference. may You

Stefan Anninger

under welcome Good investor found third section. ir.charter.com, XXXX Charter’s The morning on presentation website, be and call. can that quarter call Information to accompanies Financial the our this

filed Before most are number statements recent also there contained XX-K we you our SEC other XX-Q factors a proceed, and to of would remind this I filings, that and in risk morning. cautionary like including our our

this on factors and We other will not those statements review risk cautionary call.

you management’s plans encourage carefully. revise current obligation in only These undertakes to remarks constitute we to no update them However, forward-looking make to call cause Various they Charter or view subject results from anticipated differ results. reflect statements. that read actual this risks and to on statements or future. concerning statements forward-looking and and forward-looking additional are historical or we and make statements such the expectations, to uncertainties predictions, Any prospects statements forward-looking

of course will to in non-GAAP as These today’s we the by comparable may During to not non-GAAP reconciled earnings materials. Charter, be defined our as be measures defined and referring measures, call, also with are year-over-year on by measures used companies. that otherwise specified. the other unless noted basis titles growth all calculated rates this Please in similar and a call note presentation on

Chris On Tom Chairman CFO. our Winfrey, and today’s have CEO we call, and Rutledge,

With to turn let’s that, the over call Tom.

Tom Rutledge

morning. Good

flow per being across through customer, working transactions CapEx our recently the is Our areas, growth, well large of all free and completed significant cable relationship capital, lower accelerated product realized strategy service cash intensity are and the generation. benefits declining service customer service integration and

we're capabilities is relationship several years continue product driving execution to given and with superior network, different was our that it today than mix pricing products, customer improve. our combined growth Although ago,

quarter, customer the over with the months. growth last XX a XXX,XXX net of relationships had gain of In third we customer X%

million last Internet added Internet and XXX,XXX lines additions year. in customers over the mobile customers last X.X quarter. And we quarter, the XXX,XXX XXX,XXX also We added from up

EBITDA adjusted cable our cable cash nearly capital million quarter. third with grew X% year-over-year the of flow strong $XXX expenditures in growth by or combined free which XXX% cable We lower yielded

up including in consolidated million free nearly our $XXX investment was spectrum even flow cash mobile. Our

high periods good pricing, packaged relationship, offer products is We works customers strategy. cash and and core with of leads attractive That quality operating growth which and time. service over rates, with long improving flow to profitability our approach

customers XX% our to a our from XXX raised residential and up speed from in we products previously. Internet megabits spectrum We footprint past and to megabits higher and two approximately of speeds of We service, of continue receive as migration months, result pricing and the internet minimum XXX strategy, XX% offer improve in of our our additional megabits our speeds of number XXX markets. megabits XXX minimum a now XX% over

grow IP technologies to and megabit, today our That to and as our continue attached consumed, uniquely network, our latency more for XXX speed, Demand online and tiers through video continues offered low grow offer across gigabit will to demand our our We footprint. speed network to is increase. gaming applications entire to throughput devices new continues ultra-product more emerge. continue and

capital latency network and control DOCSIS on XX relatively we will from already at an evolve low cost. an symmetrical path Our incremental upgrade X.X gig to low

rise data continues usage rapidly. Monthly to

to times a business. all home the month, customers high value of gigabytes over Internet in compares per That translates throughput, advantage usage with price gigabits devices unlimited which average and to XXX use XX Our mobile under truly in gig per per month. non-non service, XX video well to reliability

our Wi-Fi Texas. advanced In in-home mid-October, Austin, we launched in

control position in-home operating a Wi-Fi software we’re to overtime, within simultaneously additional customers through all we footprint, over tool, to delivering devices unique app, support roll managed this entire IP by top single easily optimization plan customers managed in privacy a in experience in and to home, Wi-Fi subs markets network, rated our while in security platform solutions And and and customer our provide Given superior coverage, product XXXX. a through and better out switching bands. dynamic starting our the bands with late enhanced channel

customers ramp XX% program our self-installation self-installations volume. sales continues Our to quickly, representing of with now

internet Turning of and time to and lack selling the fixed to paid video. main mobile contributing continues growth. when video and important video, attribute of is packaged briefly the XX% percent we of our to proposition it's yet services. Over security to for sell it be problems pricing, an connectivity challenges And with the

Turning continue channels, and mobile Own line Devices. perform to encouraging. net Your our the our well Own a capabilities accelerating available of our became third very mobile, are fully across quarter, sales and spectrum Device ads Bring all mobile In products

a going and And China mentioned for positioned we wireless growth of and channels. of for we're wireline key recently remains fully the wireline under network at term launched business focus positioning network. us Ultimately beginning the Spectrum call, to Mobile forward advantage all superior pricing. our today's our and convergence customers good Mobile services medium overtime operating distributed service to products, long with attractive uniquely take area in of small and strategy I

it I'll Now over to turn Chris.

Chris Winfrey

Tom. Thanks.

sale discuss not business one item. including services quarters Navisite. results, and cloud I'll enterprise closed we On growth, financials spectrum excluding next and few the [Indiscernible] X, the prepared for the within Navisite and managed enterprise. Before covering revenue of administrative September our We've

and not On generated $XXX their was its an and Navisite revenue basis, annual million roughly material. EBITDA in on impact CapEx

and results quarter over the residential and XXX,XXX last and quarter. residential in twelve months XXX,XXX XX our in X.X% months. the third customer grew million we in by Internet on million Including last X.X grew our over and by the total relationships we by the by to or SMB, customers SMB slide X.X Turning five,

ARPU declined lines. Video added mobile wireline voice declined XXX,XXX by XX,XXX, XXX,XXX we and by higher

residential in accelerated House growth growing. year-over-year pricing remaining the at Legacy to Legacy Charter were growth spectrum third of charter legacy and customer packaging including quarter. relationship end the X.X% by customers, residential fastest higher driven with Bright our of and Legacy at XX% primarily TWC And the

In residential internet, customers customer by and third internet than XXX,XXX of churn connect residential last performance. quarter, year-over-year better total continued of growth lower in [ph] added we driven improved quarter, in resulting X.X% year's a the

by the that Over additions. video but last by overall X.X%. Similar video year, more our residential from churn, and benefited churn, than total customers Internet video decline to gross we in declined year-over-year, relationship offset lower was a

lost the to market bundle continued and wireline driven substitution quarter, residential the following by sell-in and customers mobile generally. mobile in in voice, In selling transition the we in our XXX,XXX lower fixed

added mobile. acceleration. lines quarter, the mobile in versus quarter, in the to XXX,XXX We second Turning XXX,XXX a nice

by lines lines. September of had As we XXX,XXX unlimited and XXth, a of both mix healthy gig with

addition pleased at standalone we're EBITDA net spectrum an of with accelerating the profitability, with line as So to less loss the trajectory scales even mobile, the expected the rate. per business

more and So service connectivity importantly, cable converged the we've objectives platform benefits laid out.

Over promotional customers rate by the Residential previous a relationship residential customer year-over-year year, or campaign for we last adjustments. SPP given X.X% grew XXX,XXX grew roll-off lower total by revenue migration and in of X.X%. rate

revenue mix video offset Those of are were and choice pay-per-view year-over-year. within partly base higher million customers, our lower mix true by customers, of a higher non-video $XX stream and benefits

ARPU today. growth, cable our revenue does Keep X.X%. our with in shows not of cable reflect growth customer ARPU six growth accelerating in mind resulted any our year-over-year that revenue mobile combined Slide residential

SMB quarter to X.X% revenue of and During SMB the revenue the the Legacy Bright TWC products continues as effect faster commercial, by repricing slow. grew than our from and last House

was we're growth, grew speeds customer both Navisite Enterprise but revenue year-over-year, divestiture. increasing X.X% by or SMB healthy from some modifying year-over-year relationships the still SMB X.X% by quarters re-accelerate up given X.X% promotions to relationship growth. excluding and

year-over-year. X% with Excluding by both growth cell Navisite, grew PSU backhaul and enterprise X.X%, nearly

our enterprise including products just backhaul the our wholesale relative are into And is re-sell growth not, while and so fast, factoring cell tower but growing business rate.

in year-over-year XX.X% grew data. by anonymized Non-political efficiently viewed abilities our highly to to revenue declined year-over-year due and X% much long XXXX. using capabilities revenue more tailed revenue to advertising advertising sell recent own quarter our viewing due detailed less over primarily advanced inventory by our political Third

by by X.X% CPE to to subscriber lower customers. shopping year-over-year by declined revenues home Other revenue and declines, lower video fees, by driven sold non-pay offset driven partly lower late video related churn,

revenue $XXX that third revenue revenue or total, and growth X.X% was up of X.X% $XXX X.X% quarter Navisite million advertising. Navisite. being million consolidated revenue year-over-year device with or revenue. excluding In was Mobile when X.X% Cable totaled when excluding

Moving or quarter, to $XXX operating third total in expenses the operating on by seven, slide X.X% year-over-year. grew expenses million

and X.X% due video year-over-year increased mobile, rates, higher higher a was decline to decline and operating SMB or video Excluding year-over-year. offset resi that of X.X% subscriber to by Programming subscriber X.X%. increased expenses

$XX the Choice as of lower It tied I video and is to by year-over-year higher that lower such also mix pay-per-view mentioned. lighter offset and Stream, pay-per-view revenue expenses a packages million

video by content in grew and and sold original cost, franchise regulatory cost driven connectivity fees, Regulatory of to programming that CPE order. produced customers XX.X% by and

Cost year-over-year service by growth. customers X% to customer grew relationship to compared X.X%

pushed Excluding cash changes in simplification earlier The bad for quarter we flat. year, third made were debt provision bad higher billing timing a essentially the debt balance debt, quarter. the and disconnects elevated previous account of to resulted amount customers higher of out relates cost-to-service bad the this collections in in which and

all truck Key continue and cost, for our of lowering metrics, rolls service core direction. So strategy. which quality improvements we're number meaningfully our move to customer, calls is in efficiency and right a per operating, relationship customer, churn per through to the like

driven as mentioned, insurance. year-over-year up Cable cable X.X% increased labor our And customer the cost, volume Tom expenses by third in quarter. and marketing and XX% cost, other of expenses self-installations sales enterprise X.X% were software by represented

business, totaled acquisition cost, device the expenses, tied including the revenue, $XXX operating to our portion the operate of Mobile expenses and costs, and of comprised overhead our and JV up cost, subscriber to usage own device stand were million and and Comcast. with and personnel mobile

a of When in revenue, grew X.X% million Cable the third advertising loss adjusted mobile rate including quarter. X% startup its EBITDA expense growth negative grew associated total EBITDA of periods. by both the impact in quarter, $XXX roughly adjusted in X.X% net from including the EBITDA by

Similarly, of showing the year-over-year advertising sales. basis points cable the been points margin basis we're excluding XX expansion effect today versus would have XX

to pension and prior gain million year-over-year higher by driven $XXX on net adjusted interest quarter decline net income was and The non-cash expense. year in million Turning primarily year. depreciation the $XXX amortization the chartered higher and we third in EBITDA income last offset expense, versus partly a generated eight, to measurement [ph] lower period, by slide shareholders in attributable

in and due totaled slide to the capital by over lower and year-over-year, $XXX to Turning XXXX. billion CapEx by and completion Cable CPE of third fewer all driven nine $X.XX our SPP with migrations year-over-year quarter, expenditures the declining in million CapEx digital installation

by driven of X.X the completion capital mix video video and self-installations, increasing benefit, positive associated benefit Scalable effect also the boxless lower sales higher the of and also bandwidth declined, DOCSIS outlets. year of in There's last infrastructure a XXXX.

CapEx driven some integration. Supports spending related insourcing also investments which declining support We mobile in lower, related footprint which quarter, in to was spend was software for retail driven and is our for JV million accounted did and mostly and by capital, mobile to this with for $XXX by upgrades is cable related of Comcast.

likely spending Cable bit our expect to $X less total decline CapEx billion to the Despite Cable than of year. continue we CapEx a intensity next XXXX, in

As of service despite becoming expenditures, network we're our continued with investments. very products, quality a efficient capital percentage revenue, and

cash shows; $X.X investment including billion of launch just in $XXX the XX we flow consolidated of in Slide over mobile. million quarter, free generated this nearly

nearly cable of $XXX Excluding third we billion mobile, $X.X free million up versus year’s cash quarter. just over flow, last generated

debt third the at finished in $XX.X principal. billion We quarter

cash run $X.X completed activity rate, current billion. interest, Our pro financing for is forma annualized October in

net-debt be end X.XX times our quarter, times. and intend four of third last below of to As end was to months the EBITDA the our X twelve high stay adjusted at/or We of just to the of times in half And which capable the our leverage at looking times the at include end calculating was investment to leverage, more QX. conservative upfront range. X.XX we only than leverage, a when mobile

of September During $XX totaling an and at of charter price $XXX Charter’s $X.X we've average share. billion holdings of common we shares, charter units, at billion repurchased an share. equity quarter, in X.X XXXX, per million of repurchased or $XXX XX% per average the Since price

our balance said I've and before, all future, strategy our model, As network long work together now over operating capabilities, of sheet time. periods in the

service so infrastructure of good and a our core reflect We customers products results and to use connectivity with to advantaged the ancillary flow to cash with of services, for growing tax assets our to lot on our top with levered returns. equity value expect grow

we're ready Operator, now for Q&A.

Operator

Research. [Operator Instructions] from you. New first Thank Jonathan ahead of Street from Your comes Chaplin Please the question go line

Jonathan Chaplin

the this contextualize quarter-over-quarter. Chris, of phenomenal of can can by think I'm continue acceleration obviously Is of to or is at Thank if was here? driven iPhone that wondering continue, you. from moment. cycle seeing accelerate you pace growth run even a the you wireless can you rate the new growth a we're that sort there or

Tom Rutledge

Jonathan, answer the question. its Tom. I'll

we, I available yield accelerate. as the that just is we its to the of channel and Bring in, rate. to implementation effect we and at and on we have, the it and of we accelerate that look expect taking reason tools operating at across our Your will know operate is as its all got continue You that things each and we think we're look sales, out sales guess short And that Own like growth answer marketing platforms we all we've the the really Device

activities are complete. things build of out, not And store kinds other and like

not terms yields in yield in we're look expectation the kinds when And our deployed our we our completely it's those So accelerate. to getting is mobile yet. will footprint, of continue marketing at that channels, of

Jonathan Chaplin

Tom, a And of that much pull on how the the moment? business broadband having at is through

Tom Rutledge

It's our accelerate -- well. that growth is we but hope that an broadband we effect. think it as say, hard is And to having will that

Jonathan Chaplin

Thank you. Excellent.

Operator

next Please comes from from question Vijay Evercore. line the of ahead. Your Jayant go

Vijay Jayant

again something working Thanks. piracy mitigating for done? the we you've together what talk your been Disney is improving done? and about deals you video getting some that. quarters it about Can on especially that many today you can Tom, up Fox brought expect and you Is now the be of should with sort carriage of talk talking it with addressing trends? deals about When

seen group customer you've you of considering Comcast. are obviously broadband second, your Thank launch too? competitors like Flex product And some that your your of something peer at you. that products the guys Is enable that

Tom Rutledge

Yes.

and I'm password beating wall and feel against sharing about the pricing, all issues. privacy I talking piracy but like they're head the So the my or inter-related

recognition they're is and distributors going, content some is being there been in that the result that as that programming know to industry of DNA. of need their they think I a now and part distributors, that not has their where

streams households households two streaming with Most And have kind of a people with of result there that, so, location security. streams products in sold based in have are no than for less United as been free. five and or them. the are available And States more there

relationships their TV just having replicated so based everywhere And by location sharing passwords forth. and There without streams, numbers it. of video. those result a even easy it's that makes by and can consumption, not really product people consumption massive it's look video disconnect allows -- that the based through or the for difficult to get fact value subscriber for with price too data going the and paying see And down that, we we streams virtual are MVPDs at paid as of when isn't relationship it And free. when when

content -- are need people done? need with services to security viewed of then can implement own them. to are and and that to standards so they're going know to to to the that come up And to and them have model, going a be know what You and being their to needed they're for business they're works need and they going have where

for that and effort And a requires slow so we'll some continue push process. some it's but to it, And collaboration.

Vijay Jayant

for Flex. Second question is

Tom Rutledge

sorry. Flex. I'm Yes,

an were would so it's interesting has considering and Comcast I with that discussed it that, say advantages. if have we We idea, and and it

makes but have multiple We devices us. out working us. that and with developed strategy devices, your putting inexpensive of number for sense app to relationships significant a we've service some that based is And on

Operator

comes Please go Peter Bernstein. the question Supino from from line Your of ahead. next

PeterSupino

Thank about tell wonder of In results you. the all how Charter talk the the system? personnel benefit please the I you in if the trend analyzing the whether acquired you've investments Good footprint in it's profitability and anything, systems? large measuring you're productivity of that customer the the future morning. the level Legacy or particular, facing made Could in acquired for and us about

Tom Rutledge

even customers interact tenured that of less deal know And the integration you the per We with you strategy to who satisfies a high up with to customers longer result that's – the up. company. they Charter that's with result that a And and of transaction and first more you with our time across skills up way Peter. been goes strategy and with transactions, calls, of since end goes less disconnects repeat though up you with workers Yes, have can end Legacy cost less high connects in have and the customer. as and satisfaction the end with churn down cost the serve service well-paid is customer the whole quality, that our strategy as been you your your as

cost levels is as strategy. And that environment. continued see when that increasing and serve we for if of been levels we've in it And we're our did coming What is growth at trends, that in our kind down. in and result in satisfaction entire lower per that down we And Legacy -- now we cost and cash while and are in that the they're and is I to way flow activity a so I And in say customer or their is and continued this that at our average growth of it. mean, integration growth serve this in a customer seeing a margins Charter footprint because expect across growth, do the our implement another are going you satisfied look successful activity customer means saying down. more coming life to really our customers our coming – up of

intensity a the of intensity back has where a We up and that capital have as in benefits. operating There the States, onshore. going United result of we period call largely duplication and we rebuilt stand accomplished new centers. brought was offshore, We expect that was transactions to been required almost that we're had reap the a but workforce the all to

Chris Winfrey

one have and the visibility infrastructure, obviously thing virtualized and add that. service into Legacy Peter, field entire I'd operations Charter our center still to call DMAs. but we areas the We've franchise

that and customer, what for for remained And for calls Legacy, retention it's operating and truckloads see metrics so whether that Bright Charter calls is significantly below House for calls customer, TWC despite Legacy, all customer, Legacy TWC customer, can you Part metrics, part in House Bright having billing Charter every and is continued of and previous pretty significant improvements. make Infrastructure, better Legacy that get year Legacy of because has investments improvements. Charter, a the the is significant to of quarter-over-quarter to continues better

continuing the rest had service to serve They So just means one and in investment is the virtualized, it’s throughout better basis P&L of… because Charter of if the Legacy upfront to while that expect which better same make the the cycle our at there service, cycle. a moving don't dramatically would been virtuous continuing when on or it’s it per cost we report have a continue go and of that down get track target, relationship you for to it we and

Tom Rutledge

It over we well the expect for improvement and results the of kinds bodes charter Yes. infrastructure. had eight long in years term. throughout We've or seven similar continuous

Operator

Stanley. line from Please of Your question Ben from ahead. comes Morgan go next the Swinburne

Ben Swinburne

several Tom, you if past. years network you lot run your companies about Thanks. just cable the the of could business. talked charter architecture you and I'm a for in to the the evolution the talk next advantage, cable, about infrastructure wondering Good and brings morning.

You've at been customers. speed throwing more

there's network and perspective of X.X the about also DOCSIS from I and capital lot architecture kind of You deep XXX us thinking fiber. help market you are think talk about minimums. versus intensity? would megabit How a debate that a a both opportunities in kind about XXX think product a

quarter interest wondering network therefore more next there in fourth rate Chris, couple take on grand we sort those next about intensity? how obviously the for QX wondering should and philosophy the had of of incremental enough you just what lot where of the QX I'm capital been Thank churn do incremental the ARPU in the that side just coverage be a some would you. short-term, I describe charter's there's and have those might year just product mean in scheme offering sort adjustments incremental and you since broadband just guys folks and I'm quick for a in you the focused And on. maybe one press lot changes. years over of that and of whether in thinking that

Chris Winfrey

years we've last Ben, has And infrastructure think capital of a consumption. over that rollout and both a took still budget the DOCSIS in DOCSIS from talk So, one is a intensive growth gig overall network that of over manage place thing the our and we XXX less X.X megabits operate. more And couple per average two-year really the everywhere we planning period great product our to we which that consumption from of if in look I therefore start we didn't associated we the perspective, us but that's one item and we investment made our was with customer traffic to of terms there's the capability allowed manage network offer out of that, of of and up that consumption couple customer in And data we years. next customer with to related couple of with X.X did to speed network way. per upside out can did about reduce that X.X per deployment in things with increased associated regular coming ability the the had as capital best

a that fairly that for output. X.X fundamental passed massive speed with a and you $X Both behind deployed. which project. efficient products improve assets want And legacy that's allows gig very was want look in strategy, options of your in your strategy, on specification a to increase way at in as on legacy deep massive a you to the bandwidth XX multiple it, passed, and capital our depending small the And if DOCSIS that's available it pathways a how for for home you take infrastructure strategic at investment about to evolve to you network. fiber network coaxial a capital upgrade have home your taking are cost notion development you So whether or

thinking still we've of what got we're we the the lot years? over inside the So product. next to DOCSIS – terms of just do But headroom a about experimenting this on that year we would couple do continuing completed asset technology. of so experimenting need to X.X and the moment X.X, in also bunch DOCSIS we're of things We're at experiments convergence done obviously continue and We're a mobile radio We've work with. of we've with strategy. testing, switching dual SIM to

you that talk with the occur a power to in are was think as we of that'll give hard the is And space from network. footprint electronic stand companies us still the hubs quite at them estate architecture made, throughout we deeper fundamental that replicate. we real opportunity. compute We we're the there and we low result the high But is of of at networks last development investment in cycle headroom a of gaming able to through there our of moment are look latency have a compute, upside product that time. position cycle compression And efficient. as in up have which lots that an to about putting we lots When have result

customers the way allows been to parental and their in is house also able and but connected to what management an of as security to be have Wi-Fi to to the connected itself launching their the their privacy privacy, I home. manage We of that know mentioned and for not which product in-home its only to network quality what efficient and control manage in throughout

customer set experience product So, we're in itself. the continuing invest the to in

Ben Swinburne

Thank Chris. you, helpful. That's

Tom Rutledge

you about and rate, Then maybe some thoughts. asked so

quarter, input beginning the quarter are third does that any think really at ARPU fourth to reflects of residential full And have you the clarify, Internet. just it video applied start rate recent higher mentioned not I we Our won't so cost the and rates on implemented. increases of reflect quarter, quarter. so third in non-promotional they're Those being – be which fourth of after some programming start QX, a

I it. if So questions look, some there were a take around you know

believe You look a and Internet for shows at growth. we relationship our -- QX have customer we it results long result runway

be much through So of that. there read a shouldn't too

customer integration that relationships billing the rate guess We've long-term flow. cash more transactions we'd from through always or to believed I additional manage creating as the increases. driving service grow been And calls using materially is And careful valuable the most then, way that past. through being to we're of it, they enhance in what well, not increases but customer read profitability another difference overall the had we'd that about our rate than video were when relationship said,

same We year for increases. which without two won't lot have one of And of packages promotional some have subject increasingly aren't and increases. year customers a to the have video, in wider mix we the that in rates a higher of boxes customers

is all by by preference or and optimism growing our competitiveness for across is volume that opposed strategy, products our rate remains unchanged. just maintain to So goal their to

not as similar meaningful in of negative that anticipate quarter increase. to increases have quarter on You it's fourth some fourth hope, we any might the result additions rate net feared or past asked impacts the about and don't because impact and the material,

of you quarter QX to for and this expect others just past we doesn't a we've quarter in fourth said quarter a inclusive and last as highlight as be customer fourth would relates QX keep this year half and year I the charter back mind, But and pretty of the was we it to don't expect good well. better and relationships. That mean so year that things that in to Internet the good

one year Just last pretty a keep too. we had in good mind

Chris Winfrey

and to produce growth with the say, to rates our that that believe customers just We growth would I revenue with So of be will sum regard up, the is strategy majority unchanged. we'll a new than through customer give relationships the individual our marketplace. they consumers value they as priced and with better is products get pricing in growth are designed and can and packaging the to

you If it's money people from a we're mobile perspective, much how saving at significant. look

to they're are relationships. drive and products valuable products Our designed customer

Ben Swinburne

guys. you, Thank

Chris Winfrey

Thanks, Ben.

Operator

Please MoffettNathanson. from Your next ahead. line comes Craig from go question Moffett the of

Craig Moffett

recently strategy an thoughts bones Hi. could. been some Thanks. business. traffic and like the in your meat for latest CBRS might just your what that what talk potential few Could about years? a written Two that on questions There's Spectrum over are interest lot your next put I about and wireless look the offload about just if about network offload deployment and you

business second so you I you've Warner services repricing a the we the those in where looks practical others do We customers services more start for then, to revenue like? think a volume time long of start Legacy suspect question. -- your the repricing now. and to see we Cable engaged to are growth a customers can the normalize When growth And relative been that be Time what of might through process bit lines, business

Tom Rutledge

numbers that are growth, not point. it's growth less revenue is occurring occurring customers they at its equals two Well, revenue at business historic last is growth we and it that change customer the because rate if – those because you now I'll are the quarter that started already growth you'll new see not – when that and quarter converging which growth converging customers is was our such first in but pricing true not part growth at growth getting the over services look at the creation the are of that growth growth rate revenue were true answer -- initially packaging, and some customer pricing of of customer the and and where and revenue the we rate,

to pay is own select network. and to the and about SIM thing technology majority that the customers Wi-Fi the rent of mobile Wi-Fi -- that are for And all the highly of on exists platforms most are our bulk move investments of the delivered the dictates Wi-Fi our about on platform about of quite a and XX% of strategy through we we've data of where and we're way number the as talked So, opportunity Wi-Fi our quite well and that ability using being optimistic the significant already to dual customers terms time with data, of testing efficient. traffic a we're and such opportunities that done that, in in make areas CBRS, in and interesting optimistic capability we about services

experimented traffic CBRS some using. So of to available that there's does with significant low do work rural you well. that to which wireless too We've there's and done spectrum continued a as areas. free in very been And also live methodologies know actual experiment CBRS move density connectivity. with amount we got and experiments We've customers going spectrum think that bunch fixed way an of opportunity a that with we've going with we've and

less be piece The year. auction that. There's spectrum CBRS in some should be pretty a to we spectrum. it's a So yet question you evaluating amount of next that But looking the have cells but we're we determined spectrum but of say going of more that's available it valuable And closely. there's we're I but is private significant haven't spectrum need. And this, you would at already. involved the

Craig Moffett

Tom. Thanks

Tom Rutledge

Craig. Thanks

Operator

question from of the next ahead. Philip Please Your Cusick JPMorgan. line comes from go

Philip Cusick

momentum you improvement. some by or offered as bit a any as there little connect been mostly wonder guys. we customers. being Thanks. forecasts broadband pricing Hey in have I the And driven changes are well? that can by promotional Is volumes being those better that the had better churn to Thanks. unpack if

Chris Winfrey

broadband. or megabits footprint to a in in as we've for of been the as both. There past, major talked continue or the year-over-year per combination said Internet now pricing about So dramatic improvements provider, XX% have you with now footprint, our churn go-to-market what change minimum on know a also an we they it generally in was no that you Connect XXX And basis relates speed. of it the improvement second service the to

We that's not much one-gig as a or up one-gig XXX the nationwide. service XXX but with the as that availability, also which and take and is and with headline go-to-market a Ultra

So there's pricing been promotional no dramatic past. the in change we've to typically what beyond done

Philip Cusick

Thanks Chris.

Operator

from from Your next of Rollins the line Please ahead. go Citi. question Michael comes

Michael Rollins

rate If X% quarter of we morning. the country. above average growth in it at the for Thanks about products Good in the look footprint the expansion the household which across question. was is different

long your growth Thanks. pace? So, slow help can how it were down, capital in And the that that driving how important significantly that of this does broadband? of elevated at is spend? to some it continue the is And final at if strength part

Tom Rutledge

Yes.

estimated Passings, build. and to not really as not it's a it's new across the marketable homes, good Michael is So board it's it correlation Charter unique relates one-to-one for direct and question. rates a

and through home find three rate market to only that the out sell. even and not the And marketable stuff and so are once and we companies as to our go always you systems integration of is and into you'd we're trying go marketable potentially adding different the go in definitions actually passed is, builder sometimes the as

cleanup, going that So in not still there's of alone. a and that's lot we're on

there new correct. It household commitments. broadband So the not that as areas. of and it's CapEx and or And rural over as to right. past ROIs building years meet have line areas correct, good footprint that in new build directionally couple and item accelerated completely grown you still I XXX% particularly been these we've wouldn't we And that's developing directionally can true through into build but it's line our formation, a we rural see more it's be our but extension the take may more

more that helpful household as There's as There's whether are like into like some turned is only the new that U-verse U-verse's in CenturyLink. significant Legacy lot growth of DSL is our household DSL done U-verse growth just been formation function formation the New rate. a of or AT&T of of previous overall time. our but not looking increase gaining and over We we that. around the a more share not speeds it's and think speeds to work some

where formation. to to So the taking new be significant household just opposed and adding of we're bulk share as tends we're that

Michael Rollins

Thanks very much.

Tom Rutledge

Michael. Thanks

Operator

ahead. Your go next from Marci of the Research. question comes Please from Ryvicker Wolfe line

Marci Ryvicker

first questions, Tom. Two for Thanks.

thinking boost quite just and Can of You've be this might at a talk about mentioned this XX to gigs up is what kind you bit. when step expecting, another models? our terms expenses in QX Thanks. update time. second as point which we should for then we anything Chris, is XXXX in And of or programming about there be for available might ARPU? be some You

Tom Rutledge

gig our and set that get that products level demand capability for allows to of a Look, is evolution There us term way us of at efficient to XXg so get those to our that network we've that aren't of gigabit the residential specifications today networks XX symmetrical. developed XX allow a one capabilities. perspective of that very long to in -- it's kind capability capital kinds a a from

would show there, we're If we will capability and to capacity, unless light that nature reality need be the all of at significantly point games of which include products perspective content use effective capable communications data investment rate. networks at last at that change products investment historic it'll an and field holograms low high the products, look be trends some products you will entertainment, education those of and that ultimately from and including the trends going virtual developed change very develop the will XX providing that years our of latency most

X.X and opportunity kinds way as And to calling We will actually deployment in still because that capital we're really use into that deployment deploy That's develops. the a XXG. X.X have when of function market the investments an us joke. showing we our with of is requirement it's do elements we're capital which now historic which of network or XXG make anything can continue prior is to how able our specification different arise. been a DOCSIS we've for would of just capability upgrade But a no do really to to future. the a that branders. DOCSIS is of We There a lot to regard opportunities immediate

Chris Winfrey

and just we've decline on pay-per-view maybe is channels your of mixed And and year-over-year down past the quarters piece some into this side, that had means part on done year-over-year it Resi and renewals. shift good costs that the low all inside our been year-over-year been particularly Choice them. going relative less have we've a products, then relates is to two growth top the programming, has and the and on pay-per-view that of particularly SMB of packing year programming. are okay a There's Stream growth of as to current on in been our is subscriber which we've of of on that X.X%. Marci expectations for But bigger revenue a on of which that environment not X.X%

your password efforts, expanded relationship. But some for mid single publicly digit customer we've are. those cost collective been years some had it's of And the as know renewals sharing per actual what It's announced tied which been the range. big so and in many kind unit of cost to security you has pretty

it video as that we've use talked about before, spoken of we've the services. that customers And historically causes year connectivity a as all to that that and where step-up rate overall just for see be our But continue of the that. So we're there increases. to relates to to next rate as that some nothing we've product think from type we expect passed to ability marketplace drive that out you as there even we And to the dramatic not be some about to and we associated has do will look I product. most see through through recent our been evaluating increases with today to the on there's change

been factor, has don't big than than is market mix a much a dramatic is so expect under any anything and that'll big But lower which past quarters see continue. other I don't programming So, volume absent two the challenge growth is big changes. factor, pay-per-view it's unclear changes issues, dramatic expense, I the mix some how

Marci Ryvicker

Thank you.

Operator

Your of from Partners. next Guggenheim the question line Please Mike go comes ahead. from McCormack

Mike McCormack

aggressive XQ? then then the because not use play about quick a you're of comments of for that go as on pacing as some synthetic far what out is any Thanks. double the think the these a cannibalization guys. ramp than there perhaps thinking big Maybe side guess pricing Thanks. more Hey And linear. traditional as there Tom why as just obviously bundles And Altice's but comment into Stream attractive tool I up. more wireless we on I that on lot that a missed we a product, should ads with sorry this, How Then, pricing. offerings. if the the about seeing of

Tom Rutledge

of mostly constrained And are problem selling financially product to bundled in -- consumers very that the have of a out been rate whole who people product in unit Stream, traditional passwords. and selective lot to rise in a market. of expensive who guess friends space of that's lot continues people a earlier as free of a actual big that's rate that in we've the And very priced I the video to said is way. and the with terms that I it's

is terms constrained and by And have what that with so companies do have we that the of can with in to ultimately to of in our product sell content. kinds not. bundling content our that manage terms ability power And relationship we of the

of provide and where limited a video. really be dictated terms big video bulk relationships the term form. us it's it in that that solution for of us will sold it's we long expensive because content that's to our of so, customer And to And continue in and packaged, bundles

MVNO we And of well. In over and pricing it's on for product terms different a And different a to operator pricing, of money to and Altice's that our as about that I an generally sell saves cable consumers want think it's terms driving great. think an pushing is product different attractive pricing at$XX, good it's and quite good. their that that's they're with good in and an out valuable amount they pricing, I But them there aggressive our Its timeframe. of so annual type a enormous is basis. growth driving think

Mike McCormack

phasing Great. wireless on Chris the subs? of just

Chris Winfrey

is SMB expand. the footprint was was the asked did end growth. Yes. quarter. the end And our question quarter, we're We actually barely launch, to stride. through really continue that in you'd of to think the Tom fully a our of started of said I And to hitting our on early all -- implemented going launched store BYOD Jonathan by still by of And pace just earnest hadn't had the full

And so….

Tom Rutledge

perform continue channels to better… of our All sales

Chris Winfrey

get continues to better our better. yield get To

time business saying add still say, it some it's more we're and yield to and cable. continue to I'd additions So that don't to more more more we news relatively better in sales and see risk reason over so shouldn't a and but upstart what there's any get have and net saying, value

Mike McCormack

guys. Thanks Great.

Operator

line Your last of Please John comes from Hodulik from the question go UBS. ahead.

John Hodulik

on away is on down of give is comments up look company we intensive capital XXXX? then case that follow the and A, capital that's from getting business from that efficient as its as and your sort we model out that general a model – more in examples that to does less us in capital. to connectivity in want more just another some step suggest a of your I Chris, Great. Can efficient your of view getting you more and how use the video a is that move centric towards the model?

Chris Winfrey

guidance into XXXX. in Yes. do trying me dupe we'll to some on John, when told time XXXX capital you're you we that

today as we're I'm say we So is to we've not cable But to and that, so a and the way -- percentage It's did XXXX to mentioned that anyway. going about I into before. talk intensity, strongly continue amount now revenue reasons that cable sure look too I'm that is feel early going for what for expenditure of not dollar XXXX. to and decline a capital for our about going all capital

to capital business network, down self-installation head of less per are lack capital CPE it's much old of to go decline factors spend anyway, box driving average being X.X video lower increasingly intensive. purchased the continues a integration boxes one, also more more IP that and is of age inside becomes inside more intensity. is new of essentially the could The becoming tied there's you to be boxless, I raised the Just before. they and product connect, and be year, the The think that room connect. point one the replaced about use talked I And next replace for that be amount Tom boxes opposed that of and lot the the gone just our the boxes. meaning fact as existing Internet can it to as and less was to mere DOCSIS that us headroom

the you -- business. churn just inside of know amount the It's

about significantly. your capital think takes you If churn also coming down down that

that your costs thing customer remove for momentum to serve So your on CapEx the to lot And they only the on cost ultimately fixed, a than growing of of you same the there's to CapEx to is have basis. fastest a relationship OpEx the penetration, lower company at probably network, higher the world. cable in the not in lot a business CapEx for or related western extent were least and

your efficient And image penetration become when type expansion, capital that you of well and on growth, your as OpEx. as of that have more type

of the of And that. all benefit so we're seeing

John Hodulik

Okay, thanks guys.

Tom Rutledge

care. look you same doing to right. the forward All next quarter. Take We everyone. Thank

Operator

This concludes conference you. call. Thank today's

You now may disconnect.

Charter Communications (CHTR) 25 Oct 192019 Q3 Earnings call transcript