By Harshita Mary Varghese (Reuters) -Charter Communications on Friday topped Wall Street estimate for first-quarter revenue and added more subscribers than expected for mobile services, thanks to strong demand for its bundled plans, sending its shares up about 10%. The broadband and cable TV provider has benefited from its plans that offer customers the option […]
Science
Charter Communications beats revenue estimates on strength in mobile services
Audio By Carbonatix
By Harshita Mary Varghese
(Reuters) -Charter Communications on Friday topped Wall Street estimate for first-quarter revenue and added more subscribers than expected for mobile services, thanks to strong demand for its bundled plans, sending its shares up about 10%.
The broadband and cable TV provider has benefited from its plans that offer customers the option to combine internet, TV and phone services into a single, customizable package.
Charter added 514,000 mobile lines during the first quarter, higher than the growth of 486,000 a year earlier and the Visible Alpha estimate of an increase of 477,410.
“Initially, while Charter’s ‘free mobile line’ offer boosted mobile subscriber growth, it also pushed ARPU lower… But now that Charter is finally emerging from that ARPU trough, the appeal of the strategy is obvious,” analysts at MoffettNathanson said.
While a highly saturated market makes it tougher to add new subscribers, Charter’s bet on rural expansion has aided its business.
The company’s total revenue was $13.74 billion, ahead of analysts’ average estimate of $13.68 billion, according to data compiled by LSEG.
During the quarter, Charter lost 60,000 internet customers, of which 9,000 disconnects were related to the California wildfires in January. Estimates compiled by Visible Alpha pegged the loss at 45,160.
Telecom operators in the U.S. have refreshed plans and added attractive deals to lock in customers amid concerns about a smaller market pool.
Charter’s total video customers decreased by 181,000 during the quarter, less than the decline of 405,000 a year earlier, helped by demand for its new, simplified pricing plan, which includes ad-supported version of services such as Max, Disney+ and Comcast’s Peacock.
Comcast on Thursday attributed growth at its Peacock streaming service in the first quarter to its distribution deal with Charter.
Charter earned $8.42 per share during the three months ended March 31, compared with analysts’ estimate of $8.69.
(Reporting by Harshita Mary Varghese in Bengaluru; Editing by Shilpi Majumdar)