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Charter (CHTR) Q1 Earnings & Revenues Up Y/Y on User Growth

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Charter Communications (CHTR - Free Report) reported first-quarter 2020 earnings of $1.96 per share that jumped 67.6% year over year.

Revenues of $11.74 billion increased 4.8% on a year-over-year basis, owing to growth in Internet, mobile, SMB and advertising sales.

The Zacks Consensus Estimate for earnings and revenues was pegged at $2.71 per share and $11.79 billion, respectively.

Segmental Details

Residential revenues came in at $9.29 billion, up 4.2% from the year-ago quarter.

Monthly Residential revenue per Residential Customer (excluding mobile) totaled $112.73, down 0.9% year over year.
 

 

Internet revenues grew 9.5% year over year to $4.41 billion.

Video revenues inched up 0.9% to $4.42 billion. However, voice revenues decreased 9.4% to $457 million.

Commercial revenues increased 1.9% year over year to $1.62 billion. Small and medium business (SMB) revenues rose 5.4% year over year to $996 million. Enterprise revenues dipped 3.2% to $622 million.

Moreover, advertising sales increased 5.7% year over year to $365 million, primarily owing to lower political revenues.

Mobile revenues surged 85% year over year to $258 million.

Other revenues came in at $211 million, down 4.4% year over year.

Subscriber Statistics

As of Mar 31, 2020, Charter had 29.721 million total customer relationships, up 1.7% year over year. Moreover, the company had 25.471 million residential Internet customers, up 2.3% year over year.

Further, Charter added 290K mobile lines in the first quarter. As of Mar 31, 2020, the company served a total of 1.4 million mobile lines.

However, Charter continued to lose video (70K in the reported quarter) and wireline voice customers (net losses were 83K).

Operating Details

Total operating costs and expenses increased 2.7% from the year-ago quarter to $7.34 billion.

Programming costs inched up 0.9% year over year to $2.89 billion due to a rise in renewals and contractual programming. Regulatory, connectivity and produced content costs were down 1.7% to $551 million.

Costs to service customers increased 1.4% year over year to $1.85 billion. Marketing costs were $766 million, up 4.2% year over year.

Notably, mobile costs jumped 44.4% year over year to $374 million.

Adjusted EBITDA increased 8.4% year over year to $4.40 billion. Moreover, adjusted EBITDA margin expanded 120 basis points (bps) to 37.4%.

Balance Sheet & Cash Flow

As of Mar 31, 2020, cash and cash equivalents were $2.91 billion compared with $3.48 billion as of Dec 31, 2019.

Further, as of Mar 31, total debt was $79.69 billion compared with debt of $79.08 billion as of Dec 31, 2019.

Zacks Rank & Stocks to Consider

Currently, Charter carries a Zacks Rank #3 (Hold). Electronic Arts (EA - Free Report) , Cable One (CABO - Free Report) and Take Two Interactive (TTWO - Free Report) are some better-ranked stocks in the broader Consumer & Discretionary sector, all three carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Electronic Arts, Cable One and Take Two Interactive are scheduled to report quarterly results on May 5, 11 and 20, respectively.


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