Charter’s video-subscriber customers dipped slightly in the fourth quarter of 2016, although more Internet and voice customers were added. These results were weaker than expected.
Charter’s video subscribers sank 1.3% to 16.8 million, while residential video customers declined by 51,000 versus an increase of 118,000 in the fourth quarter of 2015 because of losses at Time Warner Cable.
Residential Internet subscribers grew 7.4% to 21.4 million, with voice customers gaining 3.7% to 10.3 million.
“Charter’s net adds on video, broadband and voice at legacy Time Warner Cable were all substantially weaker than expected,” says Kannan Venkateshwar, media analyst at Barclays.
Venkateshwar adds that the company is also beginning the rollout of all digital pay TV business this year across subscribers -- for its Time Warner Cable TWC and Bright House Networks customers. “This could cause some near term churn even though it could positively benefit longer term. Beyond this the entry of players like Hulu, Google will also have impact on video net adds. Although video net adds in itself may not have an impact on numbers, the unbundling of products could result in higher churn as well,” Venkateshwar says.
Charter Communications' fourth-quarter revenue grew 7.2% to $10.3 billion. Business from Time Warner Cable customers had a 7.5% improvement -- contributing $6.5 billion in the period. Charter revenues were up 6.4% to $2.7 billion, and its Bright House revenue was 7.4% higher to $1.1 billion.
Video revenues grew 1.9% to $4.1 million, with the average revenue per residential growing 1.4% to $109.77 per month.
Net income was $454 million compared to $130 million due to a pension revaluation gains.