Charter Loses 22,000 Pay TV Subscribers in Fourth Quarter
Chairman and CEO Tom Rutledge commented on NBCUniversal's planned streaming service after the cable firm reported earnings that came in below Wall Street expectations.
Cable operator Charter Communications, in which John Malone's Liberty Broadband owns a big stake, on Thursday reported a fourth-quarter pay TV subscriber decline.
The company, led by chairman and CEO Tom Rutledge, lost 36,000 residential pay TV subscribers in the fourth quarter, compared with the addition of 2,000 in the year-ago period. It added 14,000 small and medium business video customers, up from 12,000 in the year-ago period. Overall, Charter lost 22,000 video subscribers, compared with a gain of 14,000 in the year-ago period.
In terms of broadband subscribers, Charter's growth accelerated. It added 289,000 residential and 40,000 business internet customers for a total gain of 329,000. That compares with the year-ago additions of 263,000 and 41,000, respectively, for a total of 304,000.
Overall, Charter said it added 248,000 customer relationships in the fourth quarter, up from 209,000 in the year-ago period.
Quarterly earnings came in at $296 million, or $1.29 per share, below Wall Street estimates. That compared with $9.6 billion in the year-ago period, which was boosted by a tax benefit from a reduction in the deferred tax liability as a result of tax reform.
Adjusted earnings before interest, taxes, depreciation and amortization, another profitability metric, rose 4.6 percent to $4.2 billion. Fourth-quarter revenue increased 5.9 percent to $11.2 billion.
Rutledge said that the company, after the integration of the assets it got in the 2016 Time Warner Cable and Bright House Networks acquisitions, now was expecting to accelerate subscriber and cash flow growth.
Asked about NBCUniversal's plans to launch a streaming service that is free for pay TV subscribers and would be offered by pay TV providers, including NBCU parent Comcast, Rutledge said, "They have a good point, and there is a huge opportunity" to create such a service. "Conceptually, it makes a lot of sense."