Charter Stock Sees Rise Following Unusual Increase in Pay-TV Subscribers in Q4
Charter Reports Subscriber Gains, Shares Surge
Charter Communications saw its stock rise by as much as 12% in early trading on Friday following the announcement of a rare increase in video subscribers and fewer broadband losses than anticipated for the October-to-December quarter.
In the quarter ending December 31, Charter added 44,000 video customers, compared to a loss of 123,000 in the same period the previous year. The company concluded the year with 12.6 million video subscribers, solidifying its position as the leading pay-TV operator in the U.S.
Despite the positive news regarding video subscribers, Charter experienced a decline in internet subscribers, losing 119,000 customers—still better than analysts’ projections of 132,000 losses.
Investor enthusiasm appears buoyed by these subscriber numbers, even as the company reported mixed financial results. Total revenue for the quarter decreased by 2% compared to the previous year, totaling $13.6 billion and missing Wall Street expectations by over $100 million. Earnings per share, however, reached $10.34, surpassing forecasts of $9.82.
During a recent conference call, CEO Chris Winfrey attributed the gains in video subscribers to a strategic initiative to integrate streaming services into their TV and broadband packages at no additional cost.
“Our goal is to have a video product that supports broadband acquisition and broadband retention,” Winfrey stated. He described the addition of video subscribers as a “nice side benefit” but emphasized that it is not the primary focus for shareholders.
Since entering a high-profile carriage dispute with Disney in 2023, Charter has aimed to make streaming a central element of its distribution agreements. As a result, subscribers to the Spectrum TV Select service now benefit from ad-supported versions of platforms like Disney+, ESPN Unlimited, HBO Max, Paramount+, and Peacock, translating to a perceived value of around $117 monthly. This figure is expected to rise to approximately $129 per month with the inclusion of additional services later this year.
The surge in Charter’s share price comes after a challenging period for the stock, which has declined nearly 30% over the past year due to reported issues in its traditional broadband business and concerns surrounding its planned acquisition of Cox Communications.
The Charter-Cox deal is anticipated to close in mid-2026. On the earnings call, CFO Jessica Fischer revealed that Charter has revised its leverage projection to the lower end of a new target range between 3.5 and 3.75 times debt to trailing earnings, changing from a previous goal of a midpoint between 3.5 and 4 times.
Fischer expressed that this shift should “positively affect valuation” and “attract a broader constituency of holders to the stock.” By midday, Charter’s shares settled at approximately $208, representing a 9% increase for the day on above-average trading volume.
