CHARTER COMMUNICATIONS, INC. /MO/ (CHTR) Q2 2025 Earnings Summary

Executive Summary

• Q2 2025 delivered modest top-line growth with revenue at $13.77B (+0.6% YoY), while Adjusted EBITDA was $5.69B (+0.5% YoY); diluted EPS was $9.18, with mobile lines +500K and internet net adds -117K amid a still-competitive environment .
• Versus Street: slight revenue beat ($0.03B), an EPS miss ($0.59), and an EBITDA miss versus S&P Global consensus; storms, higher bad debt and mobile device working capital weighed on profitability, partly offset by a $45M one-time benefit in Other revenue .
• Guidance inflection: capex cut from ~$12.0B to ~$11.5B for 2025 (timing and lower line-extension spend), and cash taxes reduced to “a bit over $1.0B” for 2025 given enacted tax legislation—improving multi‑year FCF trajectory; full‑year 2025 EBITDA growth reiterated .
• Strategic catalysts: improved video trajectory (losses narrowed to -80K), strong mobile momentum, MVNO expansion with T-Mobile for business, and planned Cox acquisition positioning for accretive top-line, margin and levered FCF per share over time .

What Went Well and What Went Wrong

What Went Well

• Mobile momentum and convergence: +500K lines in Q2; management emphasized mobile as a tailwind to FCF with positive mobile EBITDA less CapEx, supported by new T-Mobile MVNO for business and HMNO small-cell deployment .
  Quote: “The mobile business is now becoming a real tailwind to our free cash flow growth” .
• Video stabilization: video losses improved to -80K (best since 2021), aided by September 2024 pricing/packaging and inclusion of programmer apps; attach rates are rising, with plans to market “seamless entertainment” more aggressively .
  Quote: “We recreated the video product into something of much higher quality…another competitive advantage for our internet and mobile sales” .
• Operating discipline and service: calls down 14% and truck rolls down ~10% YoY despite storms; continued AI/machine-learning investments to reduce cost-to-serve and improve NPS over time .
  Quote: “Long‑term cost to serve is a huge opportunity…it all comes together as a virtuous circle” .

What Went Wrong

• Profitability vs consensus: EPS and EBITDA missed the Street despite a $45M one-time benefit; storms (+$13M EBITDA headwind), higher bad debt and mobile device working capital pressured results .
• Internet net adds still negative: -117K in Q2; non-pay churn stepped up YoY in the absence of ACP, and overall housing moves/new builds remain low, with ongoing competition from fiber and 5G home internet .
• Advertising softness and mix: ad sales -6.7% YoY (ex-political -4.4%), challenged local/national markets; video revenue -9.9% YoY on mix shift to lower-priced packages and streaming app allocation costs netted against revenue .

Financial Results

Segment revenue ($USD Millions):

Key KPIs:

Versus S&P Global consensus (Q2 2025):

Values retrieved from S&P Global.*

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• Strategic focus: “Our converged connectivity revenue grew by over 5% in the second quarter… strategic investments in network evolution and convergence, rural build, U.S.-based service and seamless entertainment innovation, will accelerate future customer and revenue growth” .
• Video as competitive asset: “We recreated the video product into something of much higher quality…another competitive advantage for our internet and mobile sales” .
• Mobile tailwind: “Mobile EBITDA less mobile CapEx is positive…now becoming a real tailwind to our free cash flow growth” .
• Cost-to-serve and AI: “Long‑term cost to serve is a huge opportunity…AI tools…lower overall transactions…better retention and NPS” .
• Cox transaction: “Accretive to top‑line growth, margin, and levered free cash flow per share…with modest de‑levering…additional opportunity as we think through integration” .

Q&A Highlights

• MVNO expansion with T‑Mobile (business) while maintaining Verizon relationship; intent to accelerate business mobile line growth without undermining residential Verizon MVNO .
• Taxes and FCF: New federal legislation reduces 2025 cash taxes to a bit over $1B (from $1.6–$2B), with multi‑year FCF per share uplift (~$10/year for several years) per modeling; management reiterated disciplined capital allocation .
• Non‑pay churn dynamics: Slightly higher non‑pay YoY without ACP, affecting net adds at the margin; voluntary churn lower and sales up—market headwinds include low housing moves/new builds and 5G home internet .
• Video mix and upgrades: “All of the above”—higher sales, lower churn, and upgrades from skinny bundles to fuller packages aided by guide-based prompts and programmer app integration (e.g., Peacock sports) .
• Capex intensity trajectory: 2025 remains peak year; standalone intensity to decline materially in coming years; pro‑forma Cox capex envelope consistent with proxy outlook; procurement and platform synergies expected .

Estimates Context

• Revenue: slight beat versus S&P Global consensus ($13.766B actual vs $13.763B consensus)* .
• EPS: miss versus consensus ($9.18 diluted vs $9.77 consensus)*, reflecting weather impact, higher bad debt and mobile device working capital timing despite a $45M one-time Other revenue benefit .
• Adjusted EBITDA: miss versus consensus ($5.693B actual vs $5.764B consensus)*, pressured by storms (+$13M headwind) and higher mobile-related costs .

Values retrieved from S&P Global.*

Key Takeaways for Investors

• Near-term: Expect estimate revisions reflecting an EPS/EBITDA miss, offset by revenue resilience and visible capex/tax tailwinds; tactical focus on mobile-led convergence and video attach to improve churn and ARPU .
• Capex inflection: Lower 2025 capex (~$11.5B) and tax relief “lock in” a multi-year FCF per share upswing; 2025 remains peak intensity before declining materially thereafter .
• Convergence strategy: Sustained mobile growth (+500K in Q2) and improving video dynamics provide incremental levers to stabilize internet net adds amid competitive fiber/5G environments .
• Operational edge: AI-enabled service improvements (calls -14%, truck rolls ~-10%) should continue reducing cost-to-serve and support margin/retention over time .
• Cox acquisition: If approved, pro‑forma accretion to top line, margins and levered FCF per share with a clear deleveraging path to 3.5–4.0x—key medium-term rerating catalyst .
• Risk monitor: Housing activity and non‑pay churn without ACP; advertising softness; competitive pressure from fiber/5G home internet; storm-related variability .
• Execution bar: Delivering internet growth return, scaling business mobile via T‑Mobile MVNO, accelerating seamless entertainment marketing and maintaining cost discipline will drive the narrative and multiples .

Additional Relevant Press Releases (Q2 2025)

• Webcast scheduling: Charter announced Q2 2025 webcast for July 25, 2025 (7:00 a.m. ET press release and 8:30 a.m. ET webcast) .
• Q2 2025 results press announcement (duplicative of 8‑K Exhibit 99.1 content) .

Cross-References and Disclosures

• Non‑GAAP reconciliations provided in 8‑K addendum; Adjusted EBITDA and Free Cash Flow definitions and reconciliations are included in Q2 materials .
• 2025 capex guidance reduction and drivers: timing of network evolution and lower line extensions (commercial/subsidized rural) .
• Storms: St. Louis, Ohio and broader Midwest impacted Q2; ~$13M EBITDA headwind .
• Share repurchases: 4.5M shares/units for $1.7B in Q2; average price $375 .
• Liquidity and debt: Total principal ~$94.3B; cash ~$606M; additional liquidity ~$5.8B via credit facilities .

All data points above are sourced from company filings and earnings materials: Q2 2025 8‑K press release and addendum , Q2 2025 call transcript , and prior quarters’ 8‑Ks .