Despite favorable earnings results for a 2nd straight Q, Charter continues to fly beneath the typical news radar while making strides to remove itself from NASDAQ‘s screen. The MSO added 302K net RGUs in 1Q and grew video ARPU 6%, the best result in both metrics since ’03. Phone subs swelled by 126K, nearly doubling Y-over-Y, and 12K in basic losses is a deceivingly solid result as COO Mike Lovett said expanded basic customers actually increased, offset by a dip in limited basic subs. Furthermore, rev grew 10% to $1.56bln and operating loss improved by 6% to total $358mln. But even with all the improvement, Mon was characterized by limited news/analyst coverage for Charter vis-a-vis its big cable brethren, a terse earnings call and a 2% loss in share value to $1.17. The MSO must be pleased, however, that its stock price closed Mon above $1/share for the 10th straight business day, the primary catalyst to regaining compliance with NASDAQ’s minimum bid requirement after the stock closed below a buck for 30 consecutive days. Charter remains an anomaly in the industry and on the Street because of its enormous long-term debt load, which totaled $20.6bln as of Mar 31 versus $467mln of cash on hand. The MSO expects that cash on hand, cash flows from operating activities, and amounts available under its credit facilities will enable it to meet projected cash needs through ’09, but ’10 and beyond remains murky. As such, any positive news out of St. Louis remains shrouded in viability concerns. Plus, the debt has helped position Charter notably behind Comcast, Time Warner Cable, etc in plant upgrades and new product offerings. Pres/CEO Neil Smit declined to expound Mon on references made by controlling shareholder Paul Allen in Mar to possible new investors or financial partners, but he did extol Charter’s telephone growth. Four-fifths of new residential VoIP subs are taking the MSO’s triple-play, he said, while phone penetration (currently 11%, or 1.1mln subs) is expected to hit 20-25% over the next few years. Commercial rev grew 15% to $93mln, HD/DVR subs represented half of digital RGU additions in the Q and VOD orders are up 44% Y-over-Y, said Smit.

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