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Charter (CHTR) Q2 Earnings Beat, Internet User Base Up Y/Y
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Charter Communications (CHTR - Free Report) delivered second-quarter 2023 earnings of $8.05 per share, beating the Zacks Consensus Estimate by 5.1%. The reported figure declined 8.5% year over year.
Revenues of $13.66 billion increased 0.4% on a year-over-year basis, owing to the residential mobile service growth and higher mobile device sales. The top line missed the consensus mark by 1.4%.
Internet revenues increased 3.1% year over year to $5.73 billion, but missed the consensus mark by 0.65%. In the reported quarter, Charter added 77K Internet connections.
Segmental Details
Residential revenues totaled $10.82 billion in the second quarter, down 0.3% year over year and missed the Zacks Consensus Estimate by 0.45%. Residential revenue per residential customer totaled $120.25, down 0.3% year over year.
Charter Communications, Inc. Price, Consensus and EPS Surprise
Video revenues of $4.19 billion in the second quarter missed the consensus mark by 2.83% and dropped 6.6% year over year.
Voice revenues of $365 million in the second quarter beat the consessus mark by 0.06%, but declined 8.3% year over year.
Second-quarter mobile service revenues of $539 million missed the consensus mark by 20.51% but increased 29.8% year over year.
Commercial revenues increased 1.4% year over year to $1.78 billion but missed the consensus mark by 0.46%. The year-over-year increase was driven by SMB and enterprise revenue growth of 0.2% and 3.2% year over year, respectively.
Second-quarter advertising revenues decreased 16.5% year over year to $384 million. The metric missed the consensus mark by 7.72%.
Other revenues of $666 million beat the consensus estimate by 11.44% and jumped 28.5% year over year.
Subscriber Statistics
As of Jun 30, 2023, Charter had 30 million residential customer relationships which beat the Zacks Consensus Estimate by 0.13% and increased 0.2% year over year.
SMB residential customer relationships inched up 1.7% to 2.22 million. The metric beat the consensus mark by 0.61%.
The company lost 200K video customers and 221K voice customers, beating the consensus mark by 10.97% and 7.42%, respectively. It also added 648K mobile lines in the reported quarter beating the consensus mark by 18.16%.
Operating Details
Total operating costs and expenses increased 0.6% from the year-ago quarter to $8.14 billion.
Programming costs decreased 7.8% year over year to $2.74 billion. Other costs of revenue were $1.37 billion, up 15.4% year over year.
Costs to service customers inched up 3.6% year over year to $2.07 billion. Sales & marketing costs were $895 million, up 3.6% year over year.
Adjusted EBITDA increased 0.2% year over year to $5.52 billion. Adjusted EBITDA margin contracted 10 basis points on a year-over-year basis to 40.4%.
Balance Sheet & Cash Flow
As of June 30, 2023, the total principal amount of debt was $97.8 billion and Charter's credit facilities provided approximately $3.2 billion of additional liquidity in excess of its $478 million cash position.
Cash flows from operating activities totaled $3.31 billion, down 11.3% year over year.
Free cash flow was $668 million compared with the previous quarter’s $664 million and the year-ago quarter’s $1.7 billion.
In the reported quarter, the company repurchased 1.1 million shares of Charter Class A common stock and Charter Communications Holdings, LLC common units for approximately $378 million.
Zacks Rank & Stocks to Consider
Charter currently holds a Zacks Rank #3 (Hold).
CHTR shares have outperformed the Zacks Consumer Discretionary sector year to date. While Charter has gained 18.3%, the sector has increased 13.7%.
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Charter (CHTR) Q2 Earnings Beat, Internet User Base Up Y/Y
Charter Communications (CHTR - Free Report) delivered second-quarter 2023 earnings of $8.05 per share, beating the Zacks Consensus Estimate by 5.1%. The reported figure declined 8.5% year over year.
Revenues of $13.66 billion increased 0.4% on a year-over-year basis, owing to the residential mobile service growth and higher mobile device sales. The top line missed the consensus mark by 1.4%.
Internet revenues increased 3.1% year over year to $5.73 billion, but missed the consensus mark by 0.65%. In the reported quarter, Charter added 77K Internet connections.
Segmental Details
Residential revenues totaled $10.82 billion in the second quarter, down 0.3% year over year and missed the Zacks Consensus Estimate by 0.45%. Residential revenue per residential customer totaled $120.25, down 0.3% year over year.
Charter Communications, Inc. Price, Consensus and EPS Surprise
Charter Communications, Inc. price-consensus-eps-surprise-chart | Charter Communications, Inc. Quote
Video revenues of $4.19 billion in the second quarter missed the consensus mark by 2.83% and dropped 6.6% year over year.
Voice revenues of $365 million in the second quarter beat the consessus mark by 0.06%, but declined 8.3% year over year.
Second-quarter mobile service revenues of $539 million missed the consensus mark by 20.51% but increased 29.8% year over year.
Commercial revenues increased 1.4% year over year to $1.78 billion but missed the consensus mark by 0.46%. The year-over-year increase was driven by SMB and enterprise revenue growth of 0.2% and 3.2% year over year, respectively.
Second-quarter advertising revenues decreased 16.5% year over year to $384 million. The metric missed the consensus mark by 7.72%.
Other revenues of $666 million beat the consensus estimate by 11.44% and jumped 28.5% year over year.
Subscriber Statistics
As of Jun 30, 2023, Charter had 30 million residential customer relationships which beat the Zacks Consensus Estimate by 0.13% and increased 0.2% year over year.
SMB residential customer relationships inched up 1.7% to 2.22 million. The metric beat the consensus mark by 0.61%.
The company lost 200K video customers and 221K voice customers, beating the consensus mark by 10.97% and 7.42%, respectively. It also added 648K mobile lines in the reported quarter beating the consensus mark by 18.16%.
Operating Details
Total operating costs and expenses increased 0.6% from the year-ago quarter to $8.14 billion.
Programming costs decreased 7.8% year over year to $2.74 billion. Other costs of revenue were $1.37 billion, up 15.4% year over year.
Costs to service customers inched up 3.6% year over year to $2.07 billion. Sales & marketing costs were $895 million, up 3.6% year over year.
Adjusted EBITDA increased 0.2% year over year to $5.52 billion. Adjusted EBITDA margin contracted 10 basis points on a year-over-year basis to 40.4%.
Balance Sheet & Cash Flow
As of June 30, 2023, the total principal amount of debt was $97.8 billion and Charter's credit facilities provided approximately $3.2 billion of additional liquidity in excess of its $478 million cash position.
Cash flows from operating activities totaled $3.31 billion, down 11.3% year over year.
Free cash flow was $668 million compared with the previous quarter’s $664 million and the year-ago quarter’s $1.7 billion.
In the reported quarter, the company repurchased 1.1 million shares of Charter Class A common stock and Charter Communications Holdings, LLC common units for approximately $378 million.
Zacks Rank & Stocks to Consider
Charter currently holds a Zacks Rank #3 (Hold).
CHTR shares have outperformed the Zacks Consumer Discretionary sector year to date. While Charter has gained 18.3%, the sector has increased 13.7%.
Sirius XM (SIRI - Free Report) , Electronic Arts (EA - Free Report) and Marriott International (MAR - Free Report) are some better-ranked stocks that investors can consider in the broader sector. All three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Sirius XM shares have declined 17.6% year to date. SIRI is set to report its second-quarter 2023 results on Aug 1.
Electronic Arts shares have gained 12.6% year to date. EA is set to report its first-quarter fiscal 2024 results on Aug 1.
Marriott shares have gained 31.5% year to date. MAR is set to report its second-quarter 2023 results on Aug 1