Earnings call transcript Q1 2023

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Operator

Hello and welcome to the Charter Communications First Quarter 2023 Investor Call. [Operator Instructions] Also, as a reminder, this conference call is being recorded today.

If you have any objections, please disconnect at this time. I will now turn the call over to Stefan Anniger. Please go ahead.

Stefan Anninger

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

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

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

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

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

that, our With our CEO; Chris. Rutledge, Tom CFO. Chairman; turn over and Jessica Chris President today’s call, we Fischer, Winfrey, have On our Executive the and to let’s call

Chris Winfrey

Stefan. Thanks,

first from initiative. with and rural contributions our quarter, Spectrum Internet offering the we our customers During One construction XX,XXX added

lines. quarter, mobile had we in and operate X million of the a first environment to we yet We end added Mobile XXX,XXX Spectrum the transaction At total lines. continue low

contribute grow have the will of XX% customers increasing Internet Internet meaningfully several expect we over growth. Just mobile convergence next years penetration capabilities to to our mobile service and over now and our

expenditures our reflect and generational industry initiatives, initiatives. growth key with progress cash first unique during to This growth. by opportunities quarter and very on drive is cable capital key respectively X.X% our the We the grew is flow long-term X.X% a and our which across EBITDA revenue and for designed customer time of each three

the to network initiative late low enhancement is cost. products. includes the at which evolution the our spectrum cable a first XXXXs since convergence evolution, connectivity most significant Network the also includes of The very

Second footprint since great the the bringing of is is execution, areas. underserved finally, about delivering in all expansion our unserved to broadband And XXXXs, and investing largest and which service.

these will initiatives. I on a brief provide update

evolution is well. Our network progressing plan

the markets. of of split work completed physical acquisition network is two equivalent which the XXX high now for in the to midsized spectrum. capacity megahertz have X.X We We to increased gigahertz,

In We service distributed of gigabit x use. X the same X of deployment we launching also which XX% footprint. second architecture, second our more and are about we the delivering deliver of to XX% we plan, speeds. additional us gigabit of In markets, X evolution are markets. network allocated allowing to per upstream represent these footprint adds access an which of DMAs preparing second X gigahertz will per x spectrum X based capable our our step parallel, cover the CMTS about X.X These now are split for and high

network adds three of begin in Step of evolution XXXX. our and our late our expansion XX% to should a network further gigahertz. footprint X.X covers step about plan of That

benefit target, evolution excluding XXXX the $XXX the essentially network initiative will of per passing the savings, of complete at our which will expect network any previously We come. noted by be end

product. which in includes to run Mobile marketplace. the and each the WiFi like Our fastest network spoke is converged product Spectrum Spectrum evolve. and offers offering connectivity advanced Boost Mobile to One continues features of well differentiated also Speed on It our performing

or Spectrum of pricing. over One to customers homes. promotional XX% significant which now outside of the for also our residential offers our marketplace. SMB Mobile and just also their savings both customers customers network the we Today, customers Over Internet launched in of WiFi have last advanced XX% mobile month, product, use our Spectrum retail

our So, that the our the XX% connectivity faster is economics Mobile the mobile We access network. very to don’t XG converged our in our of opportunity ability particularly our XX% to in to like large. for mix mobile have customers of lease Spectrum MVNO time

meaningful Verizon to its in and lines a active have this and we We financials. a network on contributor partner strategic are

it’s we In access when the than And that operators wireless the per plans at economics wireless expansion price by on the the is usage T-Mobile, clear fixed fixed offerings. of better our mobile gigabyte category, achieve track. disclosed pay are we look access MVNO the with pricing and dramatically

the execute During to March. activated XX,XXX have XX,XXX passings. are we the rural with rural subsidized activated in Costs growth rural equipment quarter, supply the in passings and our labor, accelerating passings Subsidized necessary subsidized as planned we is the build. and coming

experience with approximately XX%. driving faster And our The continues and growth. customer permit penetrations get we pull the RDOF penetration complete at ahead to finally, If commitments support of exceed execution X-month RDOF need, we operating which core we to of of strategy, gains the we pace deadline. years subsidized in expectations customer can satisfaction, prioritizes remain X our our committed the rule customer ultimately passings

exist, Our experience. service changing service calls would proactive fundamentally using otherwise customers occurred have they the and know can that before disconnects. customer impairments And telemetry, we pulling service-related efforts are forward even preventing address maintenance

We of in truck years. mix significantly increase expect the rolls proactive will the coming

investments faster our in service quarter they was seen. ultimately among sales higher repeat yields. times the during ever And first produce training of retention handle our deliver and generate employees expense, benefits transactions, average in frontline have upfront the We tenured best I than which are also lower transactions, employees employees, seeing and tenure investments longer while the Employee fewer expected. quality our better

network money increase will quality the our greater of upgrade. evolution the tenure of increasing project be own which also our So, with amount to and save a performed allows employees, for

increasing employee platform digital our satisfaction, reduce come further and that to the conversion IP tenure, to the of transactions. Additionally, significantly create cost network we the and and benefits, service that but lifetime customer investments, invested to video in returns. to the longer of digitization value long learning reduce to and the evolution increases point us of combination is platforms, AI continue future key our all here More service machine will transactions, have where customer in the for operating a churn, quarters, precursors our which runway service on

better do, the network on speeds, a in seamless to that are that elsewhere, focused everything us even connectivity connectivity faster customer bringing customers customer offer in ultimately, by we to inflationary had a markets environment. service helping significant seamless investing So doing more before to an and broadband not have while providing same available platforms digital that would more products qualified want investing tenured, money all service and then save delivering in service never employee,

focused converged So, our people’s shareholders. differentiated improves value on is essentially lives for creates products that strategy and connectivity delivering

Now, turn I will to Jessica. the call over

Jessica Fischer

Chris. Thanks,

want way have changes Before this discussing P&L. to our report I the we first quarter, quarter we remind everyone our to made some starting that results,

now revenue SMB revenue include revenue revenue. now is reported the we appropriate in and mobile residential mobile and other as service First, in equipment

in expense reflect integrated our these expense and the changes now longer offer separately the of side, category. and applicable our we mobile nature better no the report expenses converged and mobile operations structure. and On Ultimately, included business those are

For review changes, schedule A additional Page please trending on these of morning. information we regarding this Footnote the X posted

by SMB, by residential results to our increase lines. through Slide customer let’s first we and record this a partly $XXX,XXX a the in passed customers Including declined customers by of on added and Now, declined programming we in Video XXX,XXX X. voice $XXX,XXX mobile January driven Wireline XX,XXX Internet turn added year. expense quarter.

Although remain customer market first be growth in positive our continued Internet low. levels the quarter, activity to

record higher total below than During and well year, last lows near the quarter, but still slightly levels. pre-pandemic churn was

to third-parties surrounding over with product’s questions and confirmed have We feeds, levels impact the customer fixed typically reliability And higher Generally that wireless however, back a and issues these wireless to product access in regardless from we of seen customers scalability, way price-sensitive us fixed by exhibit churn given speaking, expect of fixed their customers segment. the competitors wireless find time. small as competition.

churn. coming drive the percentage lines though our majority and we introduction as lines increased significantly differentiated high-quality, has since priced new last service. We mentioned customers Internet relationship of attractively have existing the strong from converged product. One continue Internet acquisition of customer The with customers, very our from and of And mobile our growth meaningfully lower continue quarter, to to come Spectrum

rural in continue continue show mentioned, we issued of our in As to disclosures new areas. perform rural schedule rural well Chris X on we that Page robust today see The growth trending we also to passings.

of we quarter, continues purchasing rural XX,XXX mobile, seasonality. wireline Internet, passings subsidized voice. subsidized products passings video winter’s are including and the customers target to our construction exceed and original During rural beyond these despite activated rural Penetration

Moving to Slide X. starting financial on results

partly the growth residential with step-ups, customers X.X% a of by driven Over growth adjustments video Mobile by grew mix base. promotional non-video with offset customer rate our new relationship Internet higher customer churn. slightly per Spectrum lower accelerated Residential down revenue were and within and video-only by year, growth offset by last of customers priced of customer packages the rate

$XXX starting first X includes residential residential mobile revenue, shows, in the revenue our reminder, year-over-year. grew quarter this from XXXX. first million grew service now XXXX million of of in the quarter to as X.X% Slide which a by As And revenue quarter, $XXX

year-over-year, of by wholesale revenue SMB grew by revenue grew grew revenue X.X%. to Turning by enterprise commercial. by up year-over-year. growth And was customer X.X%. Enterprise SMB excluding Enterprise X.X% all PSUs year-over-year. revenue, X.X% reflecting X%

revenue by primarily revenue revenue due In declined by year-over-year. revenue and sales advertising subsidies. was was Other revenue ad offset consolidated quarter year-over-year our higher growing up rural X.X% advanced less driven to higher down Core mobile grew year-over-year and year-over-year total, by local XX% by political device advertising quarter driven First X.X% X.X% capabilities. advertising revenue. first lower national by

we political rate April year. adjustments remind the Looking quarter prior growth, will XX advertising in strong revenue to headwind that and face I the second lap would revenue you of

our to of operating Slide and quarter customers that million X.X% to other the expenses EBITDA higher $XX adjustments lighter of Note first by favorable total in million in year-over-year X.X% similar video mix quarter or saw in rates. in year-over-year. year-over-year due Moving network programming operating costs rebates X, first video favorable by decline partly the is a first to on of higher sports grew included year. $XXX quarter, by costs packages adjustments, we last size programming a declined expenses which X% Programming and offset and

increased costs. direct programming revenue mobile of increased by the compared year-over-year. and cost to XXXX, to customer customers by to X.X% be sales continue skilled full primarily additional in and resulting year-over-year employee other activity Other to device XXXX Looking cost mobile by to support lower driven flat tenured workforce, per video expect accelerated at and structure, a XX.X% job benefits pay Cost longer adjustments build attrition the more higher year to by we driven Mobile. Spectrum and service of approximately growth frontline to

by digital and other Longer and is and allowing our marketing growth costs. us productivity customers Spectrum driven tenure term, grew X.X% X.X% programs Partly and declined a Adjusted to increase meeting, quickly tenure result staffing the maintenance, offset channels by continue the our our expenses a this and primarily December result in evolution had X.X% at higher lower proactive in by driven expect more we to to discussed labor Sales by employee investments, EBITDA and time service over of lower grew attrition Mobile efficiencies of of cost quarter. as year sales hiring across improvements, costs which the than service service investor network we service half by grew normal quality. and year-over-year as accelerated higher and continuing first investments. we our overall of the additional transactions, expected,

billion interest first on Turning than last generated X, quarter, net down shareholders offset of the to billion net from higher adjusted with expense. income $X.X Charter more higher income we in Slide $X EBITDA year to by attributable

expenditures construction last $X.X the first totaled subsidized by residential year’s $X.X driven quarter first million totaled XXXX by Turning commercial of and to market driven network fill-in rural spend extensions, increase spend The which greenfield X. to $XXX billion across continued higher and primarily $XXX the in Slide above on billion. was first and the opportunities. of quarter, quarter compared in quarter Capital Charter’s line expansion prior initiative million in

construction purchased sequential as I in of in chain equipment we would our first note inventory quarter a issues also CapEx saw initiative construction fourth total associated that the subsidized as we rural improved decline amount a rural significant with the quarter. in supply

Customer expenditures, We more also to billion on first excluding capital higher totaled of extensions, and given year-over-year, equipment, up XXXX. timing. initiative. just upgrade capital our compared which line quarter billion $X.X rebuild $X.X was the costs, installation support network premise quarter in First spent evolution includes was given

XXXX the as because expenditures for capital construction not costs in and evolution our planned. network associated in have with full year expectations Our coming part, are changed initiatives rural

expect For the $X.X full continue expenditures between billion. billion line we to excluding capital and to year, $X.X extensions be

expect approximately excluding Following the network decline below should percentage and XXXX expenditures extensions the beginning as of and XXXX expected at XXXX, we billion. continue end reach levels of a line completion line XXXX of initiative And to CapEx, $X evolution our the decline or extension capital revenue, of thereafter. to to

extension outlook and per And or similar CapEx XXXX our rural capital extension look to line otherwise approximately XXXX at continue that commit line for to to we win assume for $X and expect billion XXXX our additional expenditure expectations XXXX We funding to XXXX year. spending.

for QX impact network typical XX driven larger buildup to flow change just than versus partly quarter of Slide mentioned. that The the and headwind this network primarily related mostly CapEx in last by I mobile was higher The we XXXX quarter larger which million but expansion initiatives by first seasonality unfavorable last of cash the and of was free outgoing excluding by the payments billion the year-over-year driven driven year. working generated $X.X in an capital, in quarter As our consolidated devices, inventory of shows, was year. decline first $XXX evolution

working and to handset as when our full over roughly of in and mismatch course the year, the timing For device the we year. headwind change receive the the be when capital, however, in a we remain we accruals devices of excluding will pay should expect payments capital Mobile working neutral mobile the between payroll impact capital given rise EIP providers.

quarter, quarters. the a payments each payments. tax of didn’t third one and four first in cash year two the made Also, cash with made and tax the quarter significant speaking, make generally we make fourth payment payments in we And quarterly second in federal

provided $XX.X changing finished principal. the on not call clarity We’re cash tax in our more of payments. debt simply We we the quarter’s outlook quarter on tax last bit a timing that with billion providing and cash

is cash Our interest current run rate annualized $X.X billion.

last of the ratio to X.XXx, X As the of our net adjusted and of quarter, at XX-month to the to EBITDA leverage we high was end X.Xx end our below range. debt stay first intend of target or just

offer with Charter’s significant country. the manner the million the position During of most to fastest average about services Holdings ridge over the in passes period, advanced the converged given nearly $X per in time-efficient million both made a network repurchased a totaling share. and and services And quarter, telecommunication Charter cost-efficient we investments now we’re common units in that and to network at price XX we’ve billion X.X it a in bandwidth homes further and $XXX upgrade X-way an and businesses multiyear gigabit Charter shares everywhere. speeds

cash poised are and allocation, to combined service-oriented to scale capabilities expand network, underserved construction and opportunities. our value. rapidly high customer expansion our operating capital initiative unserved free us that long-term and are through Additionally, flow both our higher initiatives, shareholder to prudent Those to and ROI strategy other growth, our with rural areas allowing drive and

ready Operator, for we’re now Q&A.

Operator

[Operator with Instructions] come Suisse. Doug Credit first you. will Our Thank from question Mitchelson

Your line now open. is

Doug Mitchelson

you’re will expires. for one the Thanks after the Jessica, wireless for of what just for hoping I’m XX-month full to curious Chris, strategy promotion go-to-market being the could Chris, the percentage pay do convert created promotional so much. by lines period If on one wireless, I

about that new the I phone data is how being part phone versus or that, the tracking think many lines of we numbers. adds promotional for your of versus creating as think what’s in the gross numbers usage, lines how are ported non-promotional wireless

little your understand investments from when promotion, to trying not I labor sure get Just to and benefits? what retention then that commentary think you’re Jessica, but really you’re about XQ, And the both in willing about you’re swing margins XQ to factors Or a prior should the about any revenue make you helpful. year? of certainly the comments margin of on willing start more impacting say, be the opportunity the bit the year remainder we Thank think would for half expansion to back you.

Chris Winfrey

So Doug, I’ll start go-to-market the it off on One. Spectrum with

in and before, one in for One are today. customer. going together rolls to Those other great is We the they are of give to I’ve – Freeline when offers country includes but for one second an fastest off, with getting not the have have only is it as the That taxes and they when out are usage, marketplace if connectivity existing price from product have have customers a but line the free customers purchase and Internet contracts. the connectivity two at that said you well there the period standpoint. for fastest the essentially, good $XX.XX. to going promotional best they the fees, the And product, are acquisition

So but from it’s standpoint, very a a retail. pricing very, attractive only standpoint quality from not at and promotion at a offer

getting these great be to normal service the they able not is retailer to in So that or the promotion They marketplace. and are else replicate our customers. from pricing or going anywhere us lines, they are are at expectation are

sticks. So our that all it expectation is

Jessica Fischer

rate we in majority adds Less wearables on either. include false from other plans as our of Yes. I market clear are lines lines. and Doug, some things. our coming understand we We same is those today paying numbers mean, tablets, chatter. don’t of X% gross have The are than should that be some there the phones, and our

that are So putting lines. good we’re up lines the

Chris Winfrey

time. about call. that talking were a moment this before to not in One add it to is We other thing the

Our we’re grow is intent more grow and that to here the on. path and to to continue

So excited just we’re and and from the an doing, we from to not I just think what a about save customers can bring beginning, product overall this lot the is perspective, value connectivity qualitative standpoint but money. them in that we’re both mobile a of and

Jessica Fischer

and sales. margin cost sales look you question back think you ‘XX right both to of To the But expense in the the Yes. sales are in second XQ, expense the rest might the a little what second year-over-year But happens marketing your last year. in the expense was increases year, the the now them if of on you and the marketing which and driven rate should and marketing, on year-over-year of by year, at than strong serve that of happens the and of mobile half and if to for pressure half about what and moderate really of the XQ year, comp over sequentially QX. sales put year-over-year growth sales lower in course bit marketing see

the which we’ve is on XXXX, side, to with we that think growth growth where staffing midyear consistent moderate And I I cost are before sales lapped serve were levels in We of been expect reserve is the at cost – will have the in previously, the cost One-related our half flat. which we with QX, second and increase. where adjustments. in consistent we year year-over-year to end largely XXXX with what said more Spectrum Similarly, will lap

become with generate think line it and be to the and – we we to and operate year continues business them. efficiently go to said, more generate do to that from we’ve in through more I able growth efficient, continue to the expect what So as

Chris Winfrey

first add two that just which the serve the to will and about, investments about if on at cash it’s rate promotional we to things the for the to it flow customer up OpEx going setting a piece of for to year, of you to retail and wall rate side, all that, are question, really us come. cost One lower for to quick prolonged if a good think back $XX.XX is at a period our we’ve this stick. multiyear Doug. a cost continuing talked benefit And I’d CapEx the relationship have are years ties receiving But customers today who of your other that end roll

fourth and only but revenue the and the as to better So year got prior you at side kick also that just not side the you lap gets investments, we the in that year, quarter of to cost go. starts have this that better starts

Doug Mitchelson

thanks both. disclosures rural Thank for as And Yes. the well. you

Jessica Fischer

Doug. Thanks,

Tom Rutledge

our Thanks, next Doug. please. Katy, we take question, will

Operator

Thank you.

next Our question Swinburne Morgan with Stanley. Ben come from will

Your line is now open.

Ben Swinburne

either the for to hear of Thanks, of about build-outs. wanted good morning. accelerating I of just those more kind guess rural process you,

year? that think through I put I you the what you the think for the faster are weather – the simple, make clock it takes a first getting are activated? sort – not about is even does I move greater number summer to, I higher Is better marketed I puts homes of about And as of of and simple but mean spring, quarter. rest to point we this relative it the the activated full around to it X-month start kind sure etcetera. but just was think talked – of is March through fine and it, you construction? I on definitions guys the when a that and want of got Just talk allows too

the trying to for rollout of of just sense the get So, year? rest a Thanks. this

Chris Winfrey

made to The out that my subs of Thanks, right. XXX,XXX it intend you builds, terms the coming full prepared remarks, in of winter end. is year the is we’re in was was we target with plan point that on and meet the it that. already about In I mentioned to March, The Ben. back seasonality higher meet rural much

a and little there poles bit January in you’re to on going environment. you from little have that Wisconsin. a underground, it’s is right we around. to get be keep Michigan, build our is we planning an place Whether So to that places of lot taking if Ohio, February, harder – harder a we’re like or internal in mind on in where need going whether perspective, In you’re –

is from that already that we’re there more months. back end, start – we haven’t X out for it’s for expected – coming the The picking up. technical unless and nothing clock to Jessica, we X activation the a So the

So once up it’s constructed the so that’s T is the plant zero, marketing, to minus speak. and for opened

Ben Swinburne

it. Got

Okay.

Jessica Fischer

being it’s new trending schedule reported the in way The details.

X-month passings in starts. those getting – the you’re sort clock the in as of So reporting

Ben Swinburne

promotional then I a quite follow-up came Doug’s just to Yes. battling question, you’re like are it lines, lines. lines these it don’t and the used as T-Mobile pay, thing, since sounds last like to those being earnings the specifically roll your and adding, the And night up be lines calls doing those additional continue expectation is call, to those but as will lines on

wanted I get obviously think just pay it’s anywhere. piece to – not line So on are because they you that They from created. just a these your decent are count? as thoughts are being Thanks. of I do your arguably coming to roll

Chris Winfrey

great customers Look, money. stick said when adds. to I These we but and somebody fastest We are it had said, going product. market find we do they great strange always ton tries saves high-quality a it the in of and the because a what your for to quarter. it’s are It’s you, IR

said, So to grow it that own our and you. our beyond do and line will we counts will we I what IR. Thank think continue at leave we’ve already

Ben Swinburne

you, Thank Chris.

Chris Winfrey

Thanks.

Tom Rutledge

Thanks, please. will take question, Ben. Katy, next we our

Operator

you. Thank

UBS. with John come will Our next question Hodulik from

Your line is open. now

John Hodulik

Great. rural Thanks. thanks the for disclosure. And again,

like So you out pulled rural the subs. you it XX,XXX if about guys looks adds, added

markets. core the in about talk can you anything Just

you new they again, talking more of markets you that you’re guys talk and say, on are And you competitive that wireless markets. way. incrementally fixed about rollout? upstream could on issue of the bringing see sort about high the improve, from along Does sort capacity to you capacity about infrastructure. better and of as an a of talked those sort turn more in become deployment what then seeing expanding this as expect of service Would trends If standpoint, into split

expect where we of more infrastructure things should something better competitive? be process an get it So gets or to as Thanks. the iterative

Chris Winfrey

customers the our the that which bulk that existing subsidized came John, schedule, added the inside – net were the you’ll Hey, XX,XXX, so quarter footprint. of rural adds see trending from our means in were the

to adds. where competing holding as own entire and That little in a more – in well we’re as bit aren’t churn, and first the really interesting in that non-gigabit market. footprint. lesser throughput so ultimately marketplace and existing time across gross access find of there provide. that the gross overbuild adds very our existing had So the and where mostly same a an wireless because both overbuild, extent, have it’s competing the and fiber we people somebody like we overbuild the that well includes Interestingly, alternative fiber area in on that fixed alternative, as is broadband the than until new we’re but the We both seems saw out certainly softness, has an capabilities the that

over spectrum, inside larger that subsidized the we to to to do only from legacy very that we’re expect a of rural building passings have clear, the rebuild, get continuing dynamics not continue improving seeing competing passings The we’re one that legacy are time. a growth that we’re would our So just footprint footprint. but be larger the very well and across we’re be to but that’s contributor all performance markets, just the standpoint building

the we’re enhancing with to availability contention to clean upstream split, also and high the improves which in On our upstream higher marketplace. as marketing claims we’re gives downstream us. spectrum of it marketing going capabilities, both not – which that that on are But have competitors network, us as the they well signals

of it’s I network. actual in but from fair is upstream a so claim significant more a marketing get the benefits have a network to stage the quality the helpful, this at standpoint And we think amount marketplace in and

payback get essentially reduced node from we what truck from over and as splits so doing. will both we’re competitiveness from of as as And time both roll well well reduced those,

John Hodulik

follow-up is adds higher year this just If Thank goal year? versus than it. the or, have last to still I Got could is you.

Chris Winfrey

It to this last goal year. than is Internet additions our in we have higher year did net

John Hodulik

Got it.

Tom Rutledge

question, John. our take Katy, will Thanks, lot. please. a next Thanks

Operator

Thank you.

will Cusick come Our next Phil with from question JPMorgan.

Your now open. line is

Phil Cusick

I to more Chris, a from someone you. when companies tell side Thank our else’s Hi, have IR. do you guys. lot it’s fun

be don’t shy. So

Chris Winfrey

into step rut. won’t We that

Phil Cusick

Alright.

Jon. connect understand you on in Jessica, on video an that? March ads are is percent any has video, I these you Thank broadband spoke of thoughts about But follow-up different? decline have broadband you. now you what seeing to. quarter. in you then the to First disconnects? Anything And sort anything And can in on XQ add through lot the to or seasonality acceleration typical been lower-cost also fewer base about packages? activity of And a of

Jessica Fischer

Yes.

QX. quarter. going that QX sort see looked of little in of end had being QX continue than to in the in what talking did But of of I which context So better January. in about I in difficult seasonally and of and see think had March said is across than always terms we we our And at what more February, February, Phil, continue kind is. – into coming trends, a it that with they to was better a trends the that now

good we that look on pretty least or that front. better than things that the think I it at to previously So think was continue

Chris Winfrey

the increase either a to take clear that video on pretty rate the when we even or on I’ll Internet. more So a video. correlation had we’ve increases recent There is taken

in pass-through, as where have things been. a takes mobile, and which programming there been are And place And addition So the also that of point programmers there on discussion think to is think the the longer. downgrade had to of to Internet because I have element do is we the with a I can at length that, we’ve that a very do product. of to about point-of-sale of because for has that conversation little compelling at a has focused customer the customers back certainly year. It’s simple. have. It they the the tremendous and the Xumo of It’s as live we a rate video It’s now think amount sale rollout future, viewing towards subscriptions very well better in the utility straightforward. that any point as their a towards OTT this both of of and attach video half

well customers going and really said have I very it’s be the way. my all a think on to like I that opportunity to I’ve to our has TVs. it trajectory it As video before, the think on it’s I’d as And in profitable attractive improve to platform of

Phil Cusick

Xumo a reported different category video a Will or sub as have that? for regular will be you

Chris Winfrey

more about all would distributing the definitions video through right to We customers takes extent that Charter, way benefit to that existing then will as be connectivity it as relationship. the haven’t I our use it’s think to But a we can out customer And way to right that’s an time. customers, it Xumo will are with a PSU. it yet, unit loud the going to plus the connectivity it’s just our think gotten platform that extent reporting from added likely, a I the natural just the video then take service reported it Jessica but reserve the is But a I and think be to together over go. be

Jessica Fischer

that land. to will as to And we the try on think we that, additional rollout, get we will closer Yes. where information some provide

Phil Cusick

again. Thanks

Chris Winfrey

Thanks Phil.

Stefan Anninger

our take will next question we Phil. please. Thanks Katy,

Operator

Thank you.

Peter Supino with next come from Our Wolfe question Research. will

open. Your is now line

Peter Supino

Good morning. Thank you.

subject and truly cash strategy your promotions mobile as of you use of of modeling the we gaudy the device part future? whether the On mobile results, in evolution promotions of device should your discuss for could be

Chris Winfrey

Sure.

not business service and and mobile to provide that’s And why service doesn’t their think mobile. the but we a customers that on fastest device to money we Charter I connectivity got cable into monthly convergence, exist bring anywhere, and generally overall got to product really and into connectivity the today. save

need, see don’t amount a from our savings the best of best we to we we but what product into need the device plans don’t best don’t aggressively with say never because are to We today. So, be have go-to-market already and never business subsidy we provide – value, significant standpoint. and a fees, the any strategy

Peter Supino

Chris. Thanks

Stefan Anninger

Peter. Thanks take our next Katy, we will question.

Operator

you. Thank

Our next Street. New question will from Jonathan Chaplin with come

now is line Your open.

Jonathan Chaplin

if the the subsidy be. potentially what could seeing Thanks opportunity full The what have Two be done returns on markets you markets guys phenomenal, could questions. the is may I in size wondering help awarded. work in early can we that those guys. am RDOF double if suggests be you

be Is context I industry a higher this Thanks. driving growth from XX% got for like just as might got in for forward roughly slowdown industry, the quarter. RDOF ads the or have looks I something there total of that period am the bit something it been the of we COVID from that. a it opportunity? what there wondering you And think going pull up the of opportunity? you Could of of is BEAD of broadband if any like overall be sort has growth during on? COVID, of magnitude a else it then

Chris Winfrey

RDOF On coming well highly RDOF the saying first state tell. that other And to we with start And and are of are that’s that BEAD, successful. what it’s COVID extremely would really returns other I the doing, were are ARPA have then of too really on both the we as funds. some So, been early as brands we that attractive. out pleased

the have rural have the and aggressive we into been we We because gone successful country. simply most where very subsidy, in we RFPs because experienced builder different are are entire

and ability their of success within won or the going on tell broadband but amounts government already go are Today, rural for awards provider. State well So, going we probably not significant to just have most largest – the ability build, largest mobile when we rural have video because most timeline, as a we high these bring places. we we customers, the and probably, bring money the build And rural what into to as save the these of we Federal not do. the builder are quality have to to the communities, builds into we we have are and Local, a credibility that we have the certain we we

money. Internet. customers of a whole So, single that just services play it’s bring We not connectivity save suite a

credibility both as win been BEAD, of in have is standpoint, we and economically our But high and from a successful is as terms success so We well rate – our in quality very good. what it’s are we time that to really But do going think successful can bullish some our I how front. outlook CapEx, we on certainly, am of will be I on but factored into it’s tell well.

Jessica Fischer

I to disciplined offerings. have practice add would thing for of and The now a that, Jonathan, these that we is very how bid we that sort

the execute are go to appropriate passings ability against of subsidy generates for. that passings And set price amount and bid with comfortable ability cost-effective in the against we then our our very out so a on that’s building that way we and an then to for back that and to end the with the returns

So, about get But will is I you and back will win those returns, we would what we bring it returns there hypothetical we good back be a exercise win. at can win the is to try to would what do company. clear we what and that math execute the on to into end

Chris Winfrey

Yes.

to visibility cost. We great have our

labor markets We equipment each all in we know have and up, it what different of and lined already. costs these supply

is experience confidence what really our in giving to-date we for bode So, us on. well to going bid

I the broadband to On continues forward the overall pulled in think broadband moving a that the in all lower there do transaction, of combination that market environment. be the just market, COVID and volume headwind was of lower

swing a as small back as little I is substitution. well market into so a still entire the bit And as that wireless from think suffering

others is well, hear when you some it the all that nature. of which and clearly I down, as to difficulty from if that as back industry that temporary contributes of into our come predict I I So, and normal starts to we ball. that the reason we difficult to I we – been of saying in are The also is market is well. Housing compete think all think seeing going we listen so entire this are get think to us none happens. But crystal that really back what peers, don’t into the meantime, In It’s is think if have environment. just there normalized become well. or when a very exactly including no to

as new normalization as combination is very in that as a passings Internet pipeline area. growth through And of constructing, as in good mobile a build as for obviously markets both in rural in of un-served well market as legacy the growing for are very are well we We well our large opportunity us.

Stefan Anninger

our we take Thanks will Jonathan. next Katy, question.

Operator

you. Thank

Our from MoffettNathanson. next question with Moffett will Craig come

open. Your now line is

Craig Moffett

Hi. margins, about Thank I you Jessica. could little bit wireless wonder a you. if talk

high, wireless subscriber remarkable shared results. that is leaves to business of one think get of time. it’s of scale it will also growth over And the of the it sort You means more – acquisition how imagination leaves sort pace I – the customer actually I while quarter cost very

might you. affect And you very underlying wireless Thank with or anything margins in subscribers? us traffic might and it be that forward of wireless about going you particular, customer could would offload share So, what lifetime helpful? values how

Jessica Fischer

Yes.

excluding most run we And wireless you that business information run going back we might what were We we where though, on if churn that entire broadband in think experience. customer the were, from wireless business, the the what December, of of in sort on I generate the we there the driving important, acquisition you and ultimately, the we means to business at income margin wireless our in actually wireless Craig, we there by just costs. – are terms on of So do that in cash the doing in exclude more the acquisition flow we am generate broadband, gave we to to services margin them across products terms form that thought we have the means run price do, become – as think have are it in and think don’t of business to step as some out We certainly exactly having value, doing a that into connectivity do have most means matter. a to have money we that not in have I customers, ran form margins else can we to customers, it trying adding converged available customer just benefits we to seeing by work passing been network. for would of And in a – to per both current adding more we a product and or if make per back flow which is use we which the that have the can they from video that for also as of to but increasing standalone don’t which but you the that cash pricing business also which – in It’s but someone our have good and business. about, you business. you that for to customer, if financial not the that our those to Obviously, And across comment you base. us better we costs. there and the those voice we back customer, showed materially it in bundled heard will believe reducing customer together, and incorrect

are products going financial to the the wireless to the customers what ability resulting to customer-by-customer the value it we when the from from that because take a to product. in on our adds we can more get forward have provide business we of basis confident benefit really wireless a cash So, including continue and increased us, those flow that customer

Chris Winfrey

and our network Craig, service, that in XX% to capable advanced which on residential the we all traffic deployed the prepared offload, remarks I mentioned in is mobile of now spectrum have customers. that’s WiFi devices, our

begun Mobile well. We and network as to launch to SMB Spectrum have that advanced service WiFi now

over course of to five we of offload really amounts been And hasn’t and offload. intend do inside existing market. which CBRS, them the And months given is to ability traffic very of live special for to us the the traffic So, we that’s ability household or It’s customer’s has have offload point, are large an of in deploying past the that to the this until and network significant up the outside majority fully going vast four well. local accelerating months do. prior already one household

quickly. the XX% MVNO had now already had So, we said was the our whereas of we pretty That’s XG through I decreasing that network. lease think of usage publicly

as now over WiFi more Spectrum time Mobile in a so the moving network to matter is deploy that CBRS to of as advanced that up will network XX% before XX%, increase just And over we our and well time. through months, on as was continue

is it’s so And cash in cost. flow to attractive the be and will acquisition really and tied subscriber the the profitability attractive. today And it more continue up today,

Craig Moffett

Thank you.

Stefan Anninger

we Katy, take question Thanks Craig. please. will next our

Operator

you. Thank

from with come Ehrlich will Our next Bank question Jessica of America.

Your line open. is now

Jessica Ehrlich

inventory the similar Two discount and when it then grew guys One broadband term, to it just pricing data. second also term? to about So, time then share is? telecom think a can thinking on of at in on load, you will grew? it longer of you compare lot questions. your us kind longer you. I do can CPMs? how mobile mean about on market terms are And significant Like, this it decades the what you as Thank like is have a remind of seems you Xumo, But rollout the are I you advertising, linear? more timing entered ago how mean, you you thinking to it over

Chris Winfrey

– may I was – I you wasn’t it. the broadband. followed So, the us question and need will on I sure take what to come circle completely your back remind

of year, Xumo corollaries it Xumo, product think the I on this the it’s progress back looks half going haven’t mobile. The announced well. very great. But we team, a to of had the month was

of will And as through think deployed as deployed is that TV at business where advertising end video expect you the to The CPMs. so we live of fully – year. One Charter this several come connected can places. be

today. have We that

We have the largest spectrum.

essentially largest MVPD of app country delivery used. of the is a way that the have We our app virtual anybody the because of in

in platform similar platform. connected Xumo monetize addition revenue. we have through amplified advertising CPMs connected today share of to And will will any of and that so higher the other And subscription that, Xumo TV to be its TV through spots then

in this And be case would some be which affiliate, will to of us. spots conveyed the those advertising

participate we expect that own existing a as its holder equity to way as well both advertising and we revenue advertising today. an revenue in amplify as so model our streams Xumo have And to

Jessica Fischer

that important mobile think I take is thing On take about are where go for the longer pricing in we right to term worry share that share. and there, question us to to we and market of most trying sort on – the to now

that, are take able make product. share. are to good that while margins we we still doing We to are on priced And

pricing to about think is that I there some don’t so think And now. sort right of game long-term

we mobile what in the the provide use – to and market do the is we in flow our share and cash to generate to best of about for what the business. are priced to to industry, more service Our customers, thinking fastest really take that

Chris Winfrey

of new think to of think an time really entirely you to ability create there if about lines two it, connectivity. product, sitting and could I that mobile true those at is is replicate. One on that broadband of is ways a have, sold Today, service. term, to future. pontificate. just path level sold Longer at our to sure household not either And none are to a our and individual bills. about none their competitors just need an a are of level. of a seamless is single connectivity in over competitors category product It am Today, be or separate be our mobile an the is, it, have it attribute two And they

So, that’s one it. way of thinking about

had we And trap. of We notions, they And legacy connectivity those a have of where I about that is a – about Another to used is space, for the we we is time the revenue drive saving an we marketplace. in in other had of amount instead that to a significant what significant money where wireline of think think to broadband to through and period had way prolonged thinking could be corollary telephone didn’t it and think about. to did product worry it bunch we space, as customers we as a money better products telephone save a go by as high-priced it the about it the a hand-in-hand. over-the-top aggressive mouse

and terms packaging, market potentially a to may create that may could category about the in have different to to space. ways pricing, One that time We go brand-new of we Spectrum in how really talked evolve over try include billing

Jessica Ehrlich

you. Thank

Stefan Anninger

we last our will take question please. Jessica. Thanks Operator,

Operator

Thank you.

will last come Citi. Michael from Our question with Rollins

Your line open. now is

Michael Rollins

topics. good morning. and Thanks Two

how been curious it’s segment, year? Charter, on share the details of the having since curious is beginning how any has other if ACP more Charter subscribers program just ACP, First, one on and And performance? business this then currently that activity And how contributing any positive backdrop many the I specific changes is you if customers the are or on negative, could your in of was this performing? in you for seeing the behavior macro to just the broadband impact

Chris Winfrey

In between SMB right different take soft the SMB is Honestly, will I it’s Michael, bit those. little and business, a enterprise. now.

We are growing. still

You soft. space. our can It’s low-quality And a evidence alone may that. But that in I fixed I some a think we SMB space also cheap, into – the has don’t are we that see the wireless see little been that. lower think SMB portion in of residential seeing selling of numbers. access be products

temporary. think I that’s

think but best pre-activation. UCaaS managed our services, while our sales our had relates we activate a takes access, are doing Clearly, It Ethernet, very ever have retail well. ongoing services, backhaul doing very enterprise, QX it’s actually to sales, I As pressure. retail we to enterprise, whether in for are quarter enterprise, we revenue the cell well Internet But fiber we in space tower it side. the in

who largest it’s the very So, majority in we well and And good ACP, very continues the is grow not over in to vast benefit. government, are time request. the – good government. hopeful it’s successful. now at we doing important to it’s going and participant. a a numbers to are actually space to a accelerate. marketplace. program benefiting believe, were big to and And enterprise program the that other for On ACP say – to get customers well It’s are It’s already we to it’s been have the been and the than of we that we renew that active program have continue been are their piece ACP government deploying and benefit existing from the specific retail expect to into The think the because we important, customers we

Michael Rollins

Thanks.

Stefan Anninger

Katy. to Back you Michael. Thanks

Operator

There closing questions this time. over no call turn to will the now Stefan any you. remarks. are Anninger I at back Thank for further

Stefan Anninger

you everyone next and we will quarter. see Thanks

Chris Winfrey

Thank you.

Jessica Fischer

Thanks.

Operator

ladies and This you, event. concludes gentlemen. Thank today’s

now disconnect. may You

Charter Communications (CHTR) 28 Apr 232023 Q1 Earnings call transcript