Charter Loses 145,000 Pay TV Subscribers in First Quarter

Tom Rutledge - Annual Allen & Company Sun Valley Conference, July 14, 2017- Getty-H 2018
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The cable giant, led by chairman and CEO Tom Rutledge, also reports its latest financials.

Cable operator Charter Communications, in which John Malone's Liberty Broadband owns a big stake, on Tuesday reported a bigger first-quarter pay TV subscriber decline.

The company, led by chairman and CEO Tom Rutledge, lost 152,000 residential pay TV subscribers in the latest quarter, compared with the loss of 121,000 in the year-ago period. As of March 31, Charter had 16.0 million residential video customers.

The company added 7,000 small and medium business video customers, compared with 10,000 in the year-ago period. Overall, Charter lost 145,000 video subscribers, compared with a loss of 111,000 in the year-ago period.

Charter's total residential and business customer relationships increased by 351,000 in the first quarter, compared with a gain of 264,000 during the first quarter of 2018. As of March 31, Charter had 28.5 million total customer relationships.

The broadband business led the way in the first quarter as Charter recorded 428,000 internet subscriber net additions. The company also added 176,000 mobile lines in the quarter on a net basis after adding 113,000 in the fourth quarter.

Quarterly earnings came in at $253 million, up 51 percent from $168 million in the year-ago period. Adjusted earnings before interest, taxes, depreciation and amortization, another profitability metric, rose 4.2 percent to $4.1 billion. First-quarter revenue increased 5.1 percent to $11.2 billion.

On the earnings call, Rutledge was asked about the importance of the pay TV business, reiterating that it "has its challenges" and has been declining, but "we still believe that video is an attractive product, that we should sell it and that it should be integral to our product and [that it] helps drive our core relationships." He added that Charter continues to develop new video products to serve different customers.