CHTR - Earnings call transcript Q2 2024 | Charter Communications, Inc.

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Operator

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

If you have any objections, please disconnect at this time.

I'll now turn over the call to Stefan Anninger.

Stefan Anninger

All right.

again. that try Let's welcome, and everyone. operator, Thanks, accompanies The on can found call website, presentation ir.charter.com. that our be this

anticipated I to statements plans of to make which that risk SEC differ would on a and read factors are no statements, like update filings, forward-looking and are Any or may from actual concerning remarks constitute risks only, and uncertainties remind statements. subject such reflect them you prospects and this carefully. other obligation that statements encourage call and to cause cautionary we contained results Various historical view our or management's results. there forward-looking to in to current you that revise we number predictions, undertakes expectations, Charter

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

Christopher Winfrey

Thanks, Stefan.

Connectivity driven slightly XXX,XXX by During which end X.X quarter, of the XXX,XXX close up and year-over-year. most customers, million Affordable EBITDA adjusted while second the We X.X%. we to quarter, lines was Revenue the by Mobile Internet lines Program. was added in of lost the grew Spectrum over

lot early with their and ACP into effort wasn't renewed. actively it connectivity. Beginning a the customers put this We been of we've preserve year, program, working to

majority retention ACP customers handling service well, the vast are retained teams the of Our and so and volume of we've calls far.

ACP but for higher over not fourth churn better now, the impact opportunities pay, connectivity The lack we're view ACP to drive total levels and over I time. The real the once expect quarter. also market question customers' is services have selling of of just time. of we'll a ability will inside

today's to Turning results. back

levels. low-income market and level tends an The pre-pandemic connects, connect quarter. a category broadband shift both move to helping and churn The activity added overall loss of second back already weak the to drive low of That broadband to ACP impacted mobile-only quarter seasonally volume. already be

we compared performed with than Overall and at remain expectations low better ability to ACP remains end phone to wireline for the confident competed the expanded our previous well Internet against to cell said, both program, even in the we healthy of we with each churn and return That quarters Internet, in footprints. growth. quarter. our And long-term levels overbuild

Internet Our reliable. and faster product is more

when bundled mobile. Our similarly lower pricing is with

activity demands customer will We selling companies the opportunities over pick and as grow. face expect and to continue up bandwidth time, the cell challenges to market phone

fastest creating success and with customers it providing investment applications initiative high-capacity, our per we be at of is delivered supporting service, converged everywhere AR, and traffic connectivity network operate by fully $XXX operate, We If everywhere in new capabilities combined million AI, the we are mobile our is the first as have from when XX where passing. Those own incremental an seamless capable ubiquitous, our a we'll complete, network already symmetrical, X-gigabit evolution network we multi-gig back, a a premised on growth data network take across deployed And will demand products step continued can passings. deliver. of mobile gigabit-capable network such capabilities VR wireline the WiFi uniquely all and network, network. and nation's our just XX% have

rural areas. own WiFi passings covering we ongoing construction in is points, speed with is more and our upgrades and our through opportunities partners' our router which And and access CBRS high expanding, deployment. and That to better grow product XX our also converged footprint with as set grow will connectivity nonrural get converged ROI both access over point poised network million

deliver presentation, X competitively pricing with of the positioned higher-quality products, ability Slide show of to products. we today's and are lower converged well on we investor As very bundle a

and grow, speeds it. to continues will grow usage demand data Internet, with for faster In

quarter, terabyte buy a month, not data used traditional During video over which, from per XX% residential the us do increasing. second usage, of is of who customers together Internet roughly with overall

gig to saw speed ever, tier we most our can an quarter, grow. This we area the additions

driving offering mobile results. continues strong Our to evolve,

second quarter was quarter incremental results, line the Our highest had performance former of the mobile free better net retention benefit than And we without offer also to even our add ever. quarter first our customers. mobile porteds ACP

customers In $XX. to to they the second eliminating Unlimited times, chose Plus Plus new increasingly priced fees upgrade phones and Unlimited whenever quarter, Unlimited allows April, Upgrade began existing offering Anytime want, at traditional upgrade And condition Anytime customers Upgrade wait we customers. package our during their and versus requirements. Plus $XX

April, That new price new and month. value-added new, just take in for competitive also per enhance a rates. and launched Repair point our to customer Plan These $X affordable, growth higher we access In competitively very services driving profitable open is Replacement segments.

Along launched buyout balance those May, phone lines in our we program. new

least This with at to provider at their pay helps multiline lines lines, switches providers to for to device customer ported program lines. purchases phone Mobile. new easily customer from on another Mobile Spectrum Now off other switch the Spectrum mobile to more $X,XXX and X X balance we'll existing when balances up a prospects

connectivity superior at take fastest of total at offering X% and approximately roll-off, retail. to a differentiated market-leading connect at of And the differentiated mobile. passings remain promotion having Internet Today, offering One and offering both Spectrum with well and converged course, with a pricing underpenetrated continues despite and our features. We our of perform promotional

ACP made choices The we video. video video, in loss passed turning churn downgrades rate based on as of Finally, Losses to also we have downgrade second where customers impacted seen continued affordability. quarter from in the through. programmer increases

due moved margin several away from increases, from traditional bundles pressure discounts. years, we've Over selling with the to programming last

back to linear consumers package But our the bundles, across value we into set for hybrid significant if leverage and are better choices more ourselves box. you capabilities differentiate products, marketplace, particularly ways economical full in with our video, that unique now Xumo look we're competitive DTC adding including a considering product video our to of better with

services, the around we customers versions of plan a We cost. ad-supported no new That Paramount's the reached BET+, Day. gives at package additional to May, to offer ability inclusion our to our us with Paramount Paramount+ customers cable direct-to-consumer offer launch to In and traditional Paramount. Labor DTC agreement the

Earlier the version customers later Spectrum begin available included Disney+ cost. this to TV of $X month, launched customers quarter. no this large ViX, in the extra eligible DTC packages leading customers Spanish-language January, a Disney+, a upgrade from number with and at to We ad-free Disney+ premium, to a DTC to Basic select as as TelevisaUnivision, offer product we'll became of video

offer customers select Basic retail incremental to for plan have to the Hulu price Bundle also in TV our quarter. We $X fourth at Duo Disney's

hybrid Together model, our deliver a is new track, for remain the and next want with value DTC and and irrespective So economics view stable goal our to efforts deployed they on better first we to expect to utility it Xumo, more industry, customers, fully deploy year. linear for our how for to programming a content, and be of partners.

associated that's be is sell to programmers the the help of twice. have forced less the And standalone what can't package service. instead. Customers retail, expensive full But pricing part it then if pay at really DTC DTCs we be should to

us retention, value Fundamentally, And we acquisition flow high-quality to business, positive isn't and us still that the converged time, provides option gives the video relationship. evolving believe over cash with connectivity reintroduce video we even it has if product the growing, believe more value. and opportunity a helps customer into

impacting scaled despite service order products the our growing sales quality the EBITDA, back, using unique of on capabilities. highest multiyear our transformational many focused create we're and loss driving by executing well and for We're ACP programs. stepping We shareholders. long-term services So efficiency set value cycle fully a on and without remain competitive assets to in driving of growth, and

to turn the that, over With call I'll Jessica.

Jessica Fischer

Thanks, Chris.

and Video XXX,XXX, our declined XXX,XXX customer results lines. we lost mobile declined Including Slide wireline customers by quarter, we second X. and mobile, to voice Let's on added XXX,XXX. residential the XXX,XXX in by customers while in Internet turn customers SMB,

program's primarily the $XX $XX. in driven to of was by quarter was As Chris connects the end our the June, ACP losses reduced ended early to reduced mentioned, ACP program. And May, X. original second subsidy Internet that program In in February. subsidy were

second Internet losses XXX,XXX items that an the a of impact estimate end additions quarter. our approximately to program's the from in from nonrecurring the was financial And the ACP-related gross Internet onetime and of our quarter. quarter headwind $XX on second We in revenue over XXX,XXX drove there quarter million perspective, churn

back balances balances took In addition, a similar customers had accounting the purposes. certain XXXX, June portion and that the a plans. customers many past steps program the balances of Connected eliminate in remaining Keep due for been on We end those reserved ACP of of of to portion our fully had payment put Americans for to

post revenue debt the have we For otherwise certain less had. customers been less basis, second cash with bad a low to pay ACP, than on and quarter recognizing in would in have revenue resulting slightly we a likelihood

And the ACP customer to of we they will in the losses disconnects. the occur largest third Internet with performing end be associated are weighted So will nonpay of well far, the slightly fourth but retention, quarters, in and with the driver program third. ACP

former to recipients. to subsidy continue we can We everything preserve ACP for connectivity do

XXX our ACP continue that market of customers we've And product. have of targeted to year. we offers at a including our been all assist low-income served number -- have free segment We mobile that customers, Internet those historically a Spectrum Assist products their for X offers And well. to our Internet and have program, ACP where lost offering subsidy, line we a

We to rural and XX with additions passings. by rural. quarter XXX,XXX net over customer by We quarter the footprint XX,XXX had ended in last our XXX,XXX passings We the rural XX,XXX those second Turning the in months. subsidized quarter. in subsidized the grew

We XX% subsidized XXXX. approximately passings expect in activate XXXX, rural in XXX,XXX than new more continue to to about

X our to by RDOF the We of completed be also XXXX, to build years continue expect of ahead schedule. end

second to Slide results, on X. financial Moving quarter starting

to declined rate last year-over-year, growth Mobile, partly customer of grew a by by the an the and mix residential relationship step-ups, Spectrum of adjustments promotional nonvideo ACP rate to X.X% packages subsidy. base customers Residential by offset X.X%. received some and growth revenue previously extended related per compression within higher Over offers video year, given that customers our lower-priced retention ARPU customers, Internet of

by year-over-year. declined revenue residential total, X.X% in shows, X Slide As

Turning X.X% due SMB X.X% SMB primarily revenue grew of to SMB revenue by year-over-year year-over-year, reflecting customer rate SMB monthly and adjustments. to higher commercial. customer, per growth

by of Internet grew driven X.X%. revenue when revenue, by grew And excluding wholesale enterprise enterprise year-over-year, PSU growth Enterprise -- X.X% or year-over-year. all X.X%

was revenue up about primarily X.X% year-over-year, X% revenue in X% advertising sales. driven Second X.X% by political ad excluding by was quarter mobile advertising revenue grew And revenue. X.X% year-over-year. year-over-year, given by consolidated growth. higher revenue grew device and revenue down when year-over-year second Core total, year-over-year Other quarter

Moving quarter, packages, and to programming on by lighter X.X% declined by in X.X% operating customers EBITDA year-over-year. partly a second expenses video mix decline video higher higher by to a total operating adjusted costs year-over-year year-over-year due X.X% declined the X. In offset rates. and Slide of Programming expenses

primarily quarter. productivity from as including of our costs and Other revenue mobile increased service service cost of earlier, Cost to debt expense, and billings mentioned higher profile. our sales. device our costs X.X% credit as of uncollectible an offset to XX.X%, XX-year tenure driven customer investments, I we saw and direct the portion in due labor a by as given bad revenue favorability customers declined lower mobile lower mobile some bad by year-over-year, And a revenue debt improved in portion

costs Sales on focused remain by acquisition. driving and we grew as X.X% marketing customer

benefit the grew expense insurance mostly Finally, other year by driven by prior quarter. from an expense X.X%,

in year-over-year quarter. year-over-year. EBITDA advertising, excluding when the X.X% by grew EBITDA X.X% grew And by Adjusted

the adjusted While mobile level, our when single this quarter, the allocations EBITDA positive, headwind time, product for internally. business revenue. benefit we compute don't the acquisition to and continue manage even was at mobile costs revenue P&L line allocation including a the first GAAP to And without we subscriber of standalone of

we Overall, solid and significant business to that investments in do quarter the we're we growth, the deliver competitive the a EBITDA end to believe we and this very establishing It milestone. goal environment can profitable. that a marks profitability to of is even ACP business our is mobile mobile continue path program. that and shows significant as face Our the make challenging on a

working with management the impacts of quarter. second is expense process in growing Our realization

of One half EBITDA We Spectrum to the given promotional expense management accelerating continue and our expect growth back in the advertising political roll-off revenue. initiatives, year,

as second net to on in primarily the mostly higher in quarter, settlements. net restructuring amounts of last adjusted income offset litigation due net generated severance to Slide and Turning higher line billion to with We costs X. EBITDA $X.X and by year, operating income of Charter shareholders attributable expense other was

Slide Line with in expansion billion, market to billion subsidized totaled second rural million line XX. year's $X.XX extension greenfields initiative and our in opportunities. totaled Turning last construction network year spend $X.X last second higher Capital than the sell-in expenditures quarter, residential $XX commercial driven across quarter spend. and and continued by

expenditures, excluding billion, which year was capital totaled similar the to quarter Second $X.X line period. extensions, prior

full For XXXX, capital total billion, and year down $XX the now between $XX.X $XX.X expenditures approximately we from expect to billion billion previously.

ACP XXXX for video of end of the and additions, reduced customer lower capital spending costs. which including Our CPE Internet the lower reflects outlook the net impact program, drives

We $X.X expect of efficient. actively rates our approximately approximately $X.X We're materials billion managing spend evolution spend more expenditures and billion. make vendor construction and extension line of also network to still capital

XX. to change quarter last quarter. favorable in EBITDA, million cash driven $X.X $XXX increase working year's flow totaled on timing second second due capital. increase taxes cash and the a Turning year-over-year billion, free of flow higher lower compared adjusted Slide was to an Free primarily by approximately The cash in to

increased balance On the cash overall to we've and a better front, managing sheet provide been flow that flexibility.

Over the generated billion the favorable portfolio, $XXX We million EIP launched almost program proceeds. our we $X.XX backs sold second a facility our rates. last quarters, which towers new in credit quarter, in several at interest securitization which

to to with our supply utilizing payment working extend favorability. our we've support terms, a capital tool And been financing base chain working vendor our

our We will fund on identify onetime to and investments. balance continue sheet help to unique capitalize capital opportunities

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

is price per million cash Charter units Holdings current run and repurchased $XXX Our and shares average Charter of common X.X an rate annualized interest $XXX $X.X million billion, totaling we share. at

XXXX low. XX% we run impact current our expense and sensitivity all fixed $XX would structure, refinanced interest rate than higher If our in and rates at long-dated to relatively debt rates, our due the debt of Given our rate is XXXX less be to million.

end the X.XXx. moved our months' the to EBITDA XX ratio second last down As of net to quarter, of debt of adjusted

closer to this leverage split-rated providers. the our continue range investment-grade the we the access of benefits target our market, middle the expect to We to offers to to committed to maintaining And our debt of X.Xx through given that significant remain year. X capital including to move of fully end structure, it all

in long-term the of We business. trajectory continue confident to be the

with the relative we're industry, for have will in and continue creation strong to initiative, expense business at the to best We our long-term savings products prices the best That, making our come. value to our and investments that we EBITDA combined drive years growth underpenetrated in potential. many the and remain

operator with for it And to turn that, the I'll Q&A. over

Operator

will come [Operator with first question Instructions] from Our Moffett Craig MoffettNathanson.

Craig Moffett

A down ACP Perhaps no impact. drill a the of more I'd surprise, like questions. on to bit couple little

just customers new see sign program customers additions can't lower they start moving you nonpay sign or for in is that ACP up what to who seeing activity to before are continue are gross the can't market ACP First, up up for showing extent you disconnects? -- even reduced to because

as just you're then having past? Spectrum included One that ACP, ARPU, now And you the starting not quarter. what -- of impact ARPU? X.X% second, been us were is on reported that lap same in the as what the have Had is for some numbers could You broadband would it tell the been in it it to discounts last

Christopher Winfrey

take the Craig, one, will first second. I'll take Jessica Sure. the and

of say confidence additions the estimated net higher high impact probably And that quarter well the have inside us that a that. For means XXX,XXX over ACP, level we than to was loss. we for to

coming voluntary which higher reduced a gross had and So a ACP the additions, half been as once that was other segments was from churn, of mentioned, half low-income rate from you lower rate much from at disappeared. at connecting

same And saw we Of some of of inside QX. saw course, QX. impact already of the inside we that

category the acquisition. saw the the it's I seen drivers in to you've that those And mentioned where which marketplace the inside terms really a source we half. of mobile-only half combination of when is broadband out category So about volume reversion from taking of pre-pandemic and that's that increase, there,

nature. temporary. It's in onetime It's

moves we've right the so and sure right the right onetime impact the through underlying and that managing the make connected, trying which And base doing trajectory. that for growth we're things about it's and making for just as spoken to them but making business-as-usual that that about all before, doing, we're really we're preserving investments sure also keeping

Jessica, on ARPU?

Jessica Fischer

Yes.

So X.X% quarter. in increased the ARPU Internet year-over-year

and million of items would mentioned the impact If been the X.X%. I ARPU $XX you allocation, for adjusted, have the revenue in for growth onetime Craig, that ACP-related mobile that

incorporate mentioned think a earlier. rate forward. It's in that's basis unless accounting the X end customers than at our have those items, small. think would I didn't impact But higher expectation, you recurs up X.X%. cash but I do been, paying up I for going And so -- that at those I it revenue

Stefan Anninger

Craig. Thanks,

Operator

next comes JPMorgan. Petti line of question from Our the with Sebastiano

Sebastiano Petti

Chris, in and competed you fixed think, though even -- you footprints remarks, I and wireless well said the against are though expanding. fiber their prepared

mix about to providers some of and the fiber year-to-date terms in Given the change availability, of that fiber we're in extent? access prevalence you seeing demonstrable seen into insurgent have other increasing as nonincumbent what a wholesale and getting or you the think fiber the deployments open build

did trying basis or the go-forward in you're into increase if how access on your moving think just all, about open a of thinking change, in terms to players that again, options it about And wholesalers, how to converged and other at environment competitive footprint?

Christopher Winfrey

steady than slightly pace. relatively overbuild been. If the lower competitive has it had Look, a what anything, maintained Sure. fiber it's

change we so there. dramatic And see don't any

despite about similar that it fact footprint. expanding you talked our having have means impact maintaining competitiveness, an I a the When

you if -- that's just that, So improvement to bullish, as staying an argue being I I could opposed steady. would was

so space, well more wireline space as permanent as as we're both And is the which the well. competing in well, phone Internet overbuild cell

In a And and fiber overbuild you're it access terms of wholesale at to are of end they that the relates still some -- economics, for existing seeing that of of good, haven't economics my the overbuilder for as still to an of whatnot, not economics there's in and an it's on very footprint. be mind, day. the experiments decades been deployed, need those and the

So I any done because they b, very different; really aren't been talking small the that the a, a economics about outputs What dramatically that's and don't it's of can changes the provide think it, small. is you're percentage U.S. footprint. just

And products, both that perspective, service so technology in the products marketplace. and and marketing project you and the really, the ability ability by nature a provide is to impacted have ubiquitous from the these to sales of the

a from operate. gigabit perspective, so it we is about And deployed when what's we everywhere network our unique say, have at look and us we

In have in addition to we network to operate. multi-gig everywhere symmetrical pockets, wireline that, speeds we're red that everywhere, and upgrading that just line not but

that great has capabilities other a then broadband WiFi go relationship footprint, really you capabilities who combine in partner a inside have unique. our and provide of with our Comcast. with that we of seamless gives CBRS type converged you connectivity, strategic and that's operator those And ability us only is the very and The Verizon, it to everywhere

us, X% X%, it's X% our that's have and footprint. advantage capability real I strategic that we so for because or And not in the think of

hundreds us of it in product. but operate, to we ability and We loud really connectivity, and dollars thousands advantages to the with save have marketplace, product that be only seamless about a the it of not customers having talk better allows everywhere

these you've see joint anything I than don't announcements that's changed so really of seen. other ventures, that And some

and perspective, we that tells a back about really think think It from valuation flattering. strategic it's both and you sit the you it If I from a strategy asset have.

strategic, about we about said so of our X think you deck you trying from everything have both And I we're take capable what I capabilities flattering the And that today, where of from we from have a of in people's a a Page has many what attention. think that an if look the think slide operating and doing. then valuation at others the and and and of you are perspective to MNOs, it go, do that's on

Sebastiano Petti

ask -- And a have the if been even wireless. mobile I noted sound the I for follow-up up. on It think that quick would subscribers, ACP retention lines could excluding you offer

in the have help think Apple as you upgrade what we iPhone And evolve these fears from us about market? the and about of seeing cycle back maybe in in terms year? contract buyout you're an think just concerns the of half of does about to all what the or your some go-to-market you Can need the the mean offers at might other

Christopher Winfrey

wasn't clearly quarter-over-quarter. saying Sure. had We was up. quarter. more What even quarter. good very Well, up a it was mobile this That first just up I is was

And we benefit the still would if just offers, evolved quarter. than retention you have, the also the the first mobile a have ACP of we That reflects excluded general -- momentum mobile-only but product. we strong been that very better have

Upgrade we've Anytime which in so unique rolled the out is the And market. program,

even competitive. attractive sounds function. small, customers, have to I We though service and -- it the think, repair That's, it's

in the way, in out capabilities sequentially and to buyout I And well of course of now rolled positions those market. any our think us is the phone the with also improve the all quarter unique during which that program, along have continued the balance marketplace, pretty selling and

through Anytime and come of we cost, phones program competitive to good we in really, don't ability intend be of for customers phones. to you not We've Mobile, that with us going, not make and low the But we to at have to now future. attractive the Upgrade a in models keep them of do we've only really been were a in also I programs customer been current Spectrum not be the -- it stay with because but to business where think the subsidizing have their

connectivity the here ability hundreds really to faster service, provide them higher be is seamless stating of mobile to quality, beyond of the and to the save obvious, advantage a just a the year. thousands dollars devices able biggest And

$XX about $XX and one If line each our good. competitive. at line, really for and Plus it's incremental you Unlimited on It's think very pricing for Unlimited

we're So with are we happy where the with product.

it. to We evolve continue will

of capabilities have that ties to sets WiFi which really we wireline I the as mobile the Mobile feature evolve that ability think some an to those Spectrum with things boost, include and will like and SSID. speed have

So L.A. travel those of access it authenticated is nature seamless your you'll speed for as outside in example, with your go. and connectivity. wherever you Spectrum of And York the New markets, your your is home boosts notice of you auto SSID, attached what reliability, increases which to Spectrum Mobile Mobile, the you and which an

Stefan Anninger

Thanks, Sebastiano.

Operator

the Jonathan line Our next Street Research. from comes question New Chaplin with of

Jonathan Chaplin

questions. of said just free was XQ, and in Chris, broadband you more gross on Jessica. XQ? context think market adds you then for around XX,XXX. lower give as so cash sort us one Two a flow for it it in growth ACP little on the maybe roughly bit I impact One, could Chris from same the was

What I'm to with is what's little of bit looks understanding underlying actually improved like on It you going sequentially. get growth. an to trying for a it

And any to share you're better bit And little understand aggregate just in or growth isn't relative that love it's on competitors. worse, your market a little maybe to better. market getting a so broadband getting better would either doing

that working impact of capital And XQ. it your from in is then, timing this Jessica, a like discussion sounded

be to manage changed cash so wanted sort of through to expect retain to that. I working free confirm You've this able as you and should flow to capital, just you we go year. benefit the how

to And get accelerate back repurchases again? would before leverage -- way then you do the all to have X.XXx you X.X share

Christopher Winfrey

of I there's, Jonathan, So inside your question. derivatives few a think,

let way try give for to So think what and the you're about looking me you we that it.

prior we performed switching. prior the better Inside quarters competitive first and of relative year on to quarter, had

so adds disconnects. that the was available and marketplace, And so in subscriber

in available But to new as first of that And to -- also as year-over-year. a starts, mobile-only this ACP the quarter which the removal due rental drop once reported, a saw connects, in of well, gross vacancies, of had significant back was adds, you housing for year a we driving everybody to but reduction saw we levels. highlighted is all reversion the pre-pandemic significant

That we reduced broadband -- significantly dramatic market of but QX, still a as that growth inside rate all saw overall, for those mobile factors drop.

overall onetime put market our of was performance backdrop, in which a that light given -- nature. so relative lot in market And the

it's not shrunk have In -- and due the QX, data, first ACP, we a dramatically again, and I time of while shows broadband actually for evidence the the and don't event. the onetime early most because market all our of all loss that factors the think to, as onetime

was And so doing think if that nature well. then competition of and prepared pretty you comments the put I remarks. I with our context statements relative the And about in our performance the that, we're that provided in

importantly, more a you'll between to And and the moves ACP QX when, go will impact rates out predict is back be return. once most think effect the will starts you environment. into rental normalized get but It's able dramatic come mentioned, that, to then Apartment do back most much flush predominantly, back. back. QX hard will moves exactly come I I will up. Housing as

of the attractiveness returns, we're everything I us in volume can making the doing really back once in does the ACP But on product customers, the And think in that provide same the preserve we're volume and and back up. that meantime we're out value come making end for ready pick light investments puts the great good all the a doing when well. to that we we sure position that the at to time,

Jessica Fischer

relatively a we about working previously in capital On to being for had so place I cash talked side, coming the Jonathan, the back free flat. think flow that year was

doing the we're sure As the and I we on to the said, balance what balance to appropriate sheet sheet support can are extract across we cash from business. trying working make

lands than do how I timing with better the over a capital we'll flat I'm to of variability much. in timing how that think and capital expectation, working to working lot but probably prepared expense has sort year. that capital of the not The do by exactly course exactly say

sheet take working think of so balance had thoughts we've just capital get while to the side, going I And that today. we'll total I'm benefits out good management the not that up on

question, you way do other. buybacks? the we one the had range same the from still your sort think that is of what rest and of I I accelerate was do which before perspective. over can a in do your other that you the On of was all of sort we back to the the have get middle and said how the would to a we that think about Do that we -- quarter, I'm I then to continue course buybacks do leverage place last think it of year

don't the I think then I'm business it second of the for to half and year. as do pretty trajectory the of of confident have the other. in And the one you

can meet think time. buybacks and on that I so And same we our, said what pacing sort have the at we've about, of leverage good

the the sort look there's And said, investment balance buybacks those whether allocation and We accretive of strategy opportunities still first. next. set at ROI M&A organic capital We share last this being come That still management of as changed. priorities that there. happens after before hasn't go then high sheet

right important the want that that what investments going a forward. given think make to will terms haven't we maintain sure the is drive that to the we most we so in is where total we guide which to for of business think business, do because of buybacks. And It's go growth to make we around flexibility

Operator

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

Benjamin Swinburne

action. I cost have I there working been you plan believe what talk guys had guys this were cost Chris, took you weren't know you've on. Charter, you reductions just don't year but suggested that. And guys how at headcount know you are a I you some could customer-facing guys going any to you you're of doing had approaching if about wondering I and think resources. I'm touch sort if

the as So how financials. of and look about the where sense just your think year through on impacting might we you give of that us a rest are and you the that philosophy

it. love you I'd point for know QX this at you maybe But hear have ACP then do, visibility impact if And I from XXX,XXX. don't any into if that Jessica. to

in know be decline something know love if prepared it those cost expectation your I expect us to I just color that if about quarter you the third a little understand of on still touched Would around trends. debt. to the or bad you in trying for flat more your ACP tells don't service remarks. year. And

Christopher Winfrey

with Ben, then there And X one can to which so go through, of Jessica Jessica start debt team handle had and and I'll kind I'll parts can can -- on cost bad that. reductions. I you is tag that, there's is the ACP, bit. the QX a comment second

other nonpay going to from net ACP of lot guidance as the more well. and But outlook, a But are there's be providing in any not to I we're a and additions third for there'll But be be -- Jessica think, we're parts, disconnect both customer moving sure, today. going there QX I, mentioned, we exceeding quarter.

trends adds similar quarter. bit saw Internet And of to we I about June interesting think talk been trends, the little that loss second maybe here in a oddly tidbit net July the best and June. recent in maybe more was what have the

great, activity the started ACP-related reality hasn't yet. disconnect nonpay Sounds is but the

sustainable bit payment today, August trailing little Nothing beginning and a of be scared into trends really trends. with through And about more really to but then into sustainable nonpay QX. the we'll know payment

this, when you this know I event. ACP is onetime step a back, you ultimately, but transition So know

on that on underlying also But connected. only better it's can. want obviously not ACP very so day. isolating trend impact those evaluating we retaining performance really internally And the make every impact we're our keep the ACP to we're think and what's valuable, we the sure getting because very them We customers, absent focused to and

ACP, So debt, the the Jessica on please? bad

Jessica Fischer

Yes.

the our going EIP One So if profile in there's on. and tenure few That's really what a that Ben, bad credit things plans us. about year-over-year, happened improving, was in mobile customers debt particularly think you have for in with base. customer been

debt And on a took the way, ACP of customers along the for front, ACP outstanding particularly lot had and entered they unpaid we who the bad balances. program,

throughout program. reserved been those so the have really ACP And

it portion very there ACP have them. mentioned in of low is customer remarks the payment a for base I a we the where of expectation that also

of actually revenue And then their those as debt for so offset, taking customers. bad into taking didn't an we instead revenue and revenue recognize expense

more other back means had expense, that, direction. debt the put see that, it think, bad you you in absent I So when would expense that had bad if that have have -- might you debt we had

we some point, last in the year-over-year lower then overall XQ the and have did changes. revenue resi And and mix

that a things with drives being pressure other downward so also on bad equal, And little bit of debt.

the All into bad at with debt of that about think looking of year-over-year. in is that it and what anything sort happened you is to say I wouldn't QX read what

there I going of a number think there. factors on are

what's expense the question, reduction your As cost pretty I on then think extensive. think you the is side, happening about process other which management was overall

things opportunities doing some our will the small, we're medium, big, While short, all have some service that are we business. long-term impact anything or across things not that capabilities, are that some sales

We've had from with tools the little spend overhead made reductions implementing increase than some around faster those real and categories some to third-party I actually, expenses estate cost And like into think with we what our progress anticipated. reduced some services, efficiency. reductions, discretionary a and benefits to vendor XQ came

already benefits We'll But on the build opportunities we're additional realizing some time. changes. over of to continue the of

look of year, on at our think given some for you As thoughts the expenses. we rest outlook the had I

expense. to by expect X% to flat year-over-year. I that We XXXX. per X% in year-over-year. cost bad the cost to X%, range grow that to be to programming now We said decline customer had expect to of video that we previously flattish to had I now expected expected inclusive debt be with X% serve

low be bit had X% end not And a at in X% growth. to if this I I think would in us the said below. expect marketing, of that range, sales to point, to we And

on my I to the want something EIP capital comments also, want working clear aside, as comments have an nodes. said to continues cable to clarify on the working on are I that be I of capital. earlier, working the detriment Mobile just capital.

we will a be the did those plan securitization that. the though continue help so drag in to quarter does that And

Christopher Winfrey

I a Jessica The so layer lower-growth -- vendor to look. better overheads, reduction permanent, on cost, service one a of -- maybe just the to cost the All lasting accelerating But a understands organizational real, us sure that on in effectiveness key different And savings, be operator. that's for take lots is just right, and true. terms is everybody environment. make of just doing in want we're focus

better frontline, investments that. process So continue to that the our make to we've in made and we tools, have invest systems in and see tenure,

onetime success service quality are That's having reducing from the calls, we bigger some at. the amount the service reductions. truck the increasing having rolls, so reducing But of provide. money that the our real And probably and cost of of on where we're also permanent results we is

the more used think have more then And per have to to revenue. we and leverage better customers leverage, best which operating that before, about operating to have way products term is household have higher is a you've and a

and cost we being that of And together, can, your better your higher penetration having lower a service products, you operator per serve to customer. actually

cost your capital cash well. customer better a lower operator. become as You And of per you flow

cash impact all. anything free about So those sales the opportunity not long-term true doing And true. our all really about our that's hasn't views that line we changed flow. when or on front opportunity, why deliver management that's the of at would to and expense hold talk efficiency things because and that it's still service talk we that And

Stefan Anninger

Ben. Thanks,

Operator

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

Jessica Reif Cohen

And a Hulu. couple I coming, take-up else that and Can are in about video, direct-to-consumer of talk hybrid on Is these on horizon? the mentioned guess. Question anything the you you've there linear offers? Paramount+

you then political advertising in And up half. second pick the secondly, should mentioned

the expectations political on us if that's increasing? some can you environment, and give Given color current

Christopher Winfrey

Sure.

On Jessica, going is very the DTC first well. one, the take-up

think it's deals but know month. it's every we in launched, And about I I one, January first The lot think, September, of Basic. growing Disney on Disney+ and in the a people late going well,

the which in be well we to remarks, some helpful it, that adding incremental That into addition see. add-on the further the as Hulu. of will accelerate Disney that premium the an coming Bundle as soon Basic monthly the even I for of prepared features $X Disney+ as additional be growth plus includes, We're mentioned will as Duo

inside to was So that's always a you that design. same comprehensive package retail, allows that way It and of the exists the have helpful.

of some of that But But terms all and principles Everywhere between there's because complexity of its credentials this also in whatnot. authentication of and TV accelerating. operators terms the going well, different implementing vary it's and in

ESPN+, but packages. very I It's our call, mention going also take-up. good on penetration high is value the that into a small the That's didn't base, of is having RSN the portion well.

fully had we've or universe. the authenticated working our towards. product, that of which And TV what so year a Everywhere And and the soon. within next launch we'll over has always baked that existed will Paramount+ MAX, ViX, just we launched. we're really is set expectation so have already is And

we're if doesn't direct-to-consumer think the they arrest And the going extent more the loss we here sitting of there, going the are be. to video, what saying broadband more get the we'd effective our scale that that have through value. to customer, bill, to going is then to have And but it saying not on it's take We're value applications. just the we rather it to we're I video go put better completely

not to time. of been MVPD what the bill. we on broadband in to it we're to on using path And putting able the we're being proud that the bill the expensive, it And where be has a space relationships. see be a amount that to need a be long may video proud has we that's And connectivity putting and of significant of what product drive but converged as value a

be So our and while can really think it's growing, may it valuable relationships. important, still to I be connectivity converged not it very

versions an as that In part that's really because schedule. And to better need as of reduced the ad-free give of renewal terms for a actually these products optimistic full not has the to programming that programmers both included upsell DTCs video we're this do But going the from go of what's understanding we're up of into adopted churn been package. be next, opportunities and well.

can end them cheaper the the product the of through a at pay in should. if we the at price us. more to customer a and -- think think get I same look, day, go marketplace, don't I they out should the ask And

those but ones. most are of certainly, that core had principles are those so of we've some the the some bigger And

always Political and -- state-by-state as going basis. know, jump it's as ball evaluated it's go, it's on always exactly a advertising, you to it's where to a

And everywhere. it's nationally really so the can't you say same that

swing on depends it states. So of some the

past it probably fundraising jumbled it the of might been week at nationally take a what to states, and advertising volatility going is would than you swing looks thought certainly, the events be ago. what look XX And that what could days like. Admittedly, when be have you higher political and have like just the look

in eye happens it's on the so when in it mean it's states happens, onetime we're and that nature. right nice And but an But doesn't necessarily that. it keeping for us,

we impacts try next why is this results talk to And so because be year's our and of the political advertising without what headwind. will with that's about always year's windfall

business, And we or right continues everybody subscription includes which without want political advertising, is of to core focused well the thing, make profile underlying which the on with is the which the growth to sure advertising. do

Stefan Anninger

Thanks, Jessica.

Operator

of line with Supino final will Wolfe from Our Peter the question come Research.

Peter Supino

third retention been the for it. greatest beyond operators, question ACP good An ACP looks took that program has of history's Arguably, quarter. advantage and you broadband

from rate? having we that and million Certainly go in essentially who higher its a retention maybe say, should And slightly benefit needs to up former churn away? rate the attributable go involuntary X it to to, QX underlying does. Looking a Or disconnects wave no to normal place? expect in subs step of out what churn those having million, churn does X beyond ACP then XXXX,

Christopher Winfrey

to were upon time, long a When participant ACP, -- but think once look, big assets which which -- And we ACP. we've a the an all education became EBB, Well, participant a Sure. remote in -- industry. had Keep the pandemic, the offer, the you significant Americans Connected, and those we of a there Broadband had been time. we wasn't the it's about during been the Benefit, the the in Emergency became evolved

proud before, continue to we those have a have all to be product. we marketplace. a broadband really for that up really from stepping of lot they And Charter exist to address perspective, think ways I a and didn't important and programs. But driving is

in in on by go out market I asked do there, doesn't an broadband that, the an exist, have environment affordability. you that I think of and more equivalent definition, you level coming about where based customers Before activity. ACP or

that transaction gross price, well a up better your sales work from both from advantage. drives nonpay ad and That towards products When perspective. can as better have a as disconnect volume, you

it's bad So not from our all perspective.

But we for and have unique acquisition at to, ability the retention, offer products. also

Our everybody, it's Internet XXX is affordable. attractively priced. for but It's not

line pair rolls can year, you that together line the so to with the and and then have -- One, that first for also Spectrum a We ability mobile free to $XX year. a after

typical think average you of cost a environment a environment, about in a or If typical the two-line even $XX. line one-line is over

in we've even at of per our with so taking retail a $XX, rate of through built month savings And attractively product. by mobile $XX power together priced a broadband

can to that ACP benefit, -- take our when the And available savings than you we of take product full we much, really our set. that's if the have built-in which more, means you ACP advantage not products, as if you effectively

having I availability so combination a all we customers save whether combined, programs. that wider if more, much, fully these prior offer we and the to a these I product -- together And think of with getting we can is of population a exist And ACP by think past. as Spectrum that have which not for low-income can didn't One offers, broadband our through relative to

But base. of is couple for So it's in the to able than last I the to going sure, what years. position activity, think the be good higher address be been we're in to market

Stefan Anninger

And concludes our call. We'll Peter. see Thanks, you quarter. that next

Christopher Winfrey

everyone. Thanks,

Charter Communications (CHTR) 26 Jul 242024 Q2 Earnings call transcript