Charter Stock Drops 5% as Internet Customer Losses Overshadow Cox Merger Boost, Massive $3 Billion Cost-Cutting Turnaround and More

Charter Communications Inc. (NASDAQ:CHTR) stock fell 5% Friday after the company posted mixed third-quarter 2026 results and reported further losses in residential internet and cable television customers due to competition from budget home internet plans major wireless carriers offer.

Charter also unveiled a broader operating overhaul aimed at cutting costs, simplifying the business and rebuilding broadband subscriber growth.

• CHRT stock is holding steady today. What’s next for CHRT stock?

Earnings Beat Expectations

The cable and broadband provider reported revenue of $14.92 billion, down 1.7% from a year earlier but slightly above the analyst consensus estimate of $14.83 billion. Adjusted loss came in at $(20.50) per share, missing expectations of $9.02 profit per share.

Broadband Business Remains Under Pressure

Charter continued to lose broadband and video customers during the quarter as competition from fixed wireless and fiber providers intensified.

The company lost 233,000 internet customers on a pro forma basis (including the operations of its merger with Cox Communications, and 77,000 cable TV subscribers) as compared with a loss of 171,000 a year earlier. Video customer losses narrowed to 77,000, compared with a loss of 121,000 a year earlier, helped by simplified pricing, revised packaging and the addition of streaming services to Spectrum’s expanded basic packages.

Adjusted EBITDA margin narrowed 100 basis points to 39.9%.

Mobile Growth and Cox Deal Support Outlook

Wireless remained a bright spot. Charter added 508,000 mobile lines on a pro forma basis during the quarter, bringing its total to 13.5 million as of Sept. 30, 2026.

Cash Flow, Capital Spending and Debt Plan

Free cash flow declined to $674 million from $1.62 billion a year earlier as capital expenditures increased. Net cash provided by operating activities totaled $4.03 billion.

Charter ended the quarter with $573 million in cash and cash equivalents and served 34.3 million internet customers.

Executives Outline Growth Strategy

CEO Christopher Winfrey said the company is overhauling its operating model to return to growth, with Internet customer gains, lower churn, improved service, network upgrades and greater efficiency as its main priorities. Charter plans to simplify offers, strengthen sales channels, use smarter pricing, expand convergence across Internet, mobile and video, and continue deploying AI to improve service and reduce unnecessary customer interactions.

Winfrey said Charter also expects the Cox Communications acquisition to support growth through more than $1 billion in transaction synergies, lower product penetration across the Cox footprint, stronger business-services capabilities and the transfer of Cox’s AI network-reliability team.

Charter is targeting another $2 billion in annualized operating-expense savings over 18 months, while management expects declining capital spending and those efficiencies to drive stronger free cash flow over time.

Management also pointed to mobile, video and network convergence as key growth drivers, while acknowledging intense broadband competition from fixed wireless, fiber, mobile substitution and aggressive promotions. Charter said it has not seen meaningful share losses to Starlink but continues to monitor the service closely.

On the outlook, Winfrey said Charter is not providing a specific timeline for returning to growth but wants to make immediate progress in narrowing Internet subscriber losses at both legacy Charter and Cox. Management also plans to direct most near-term free cash flow toward debt reduction as it works toward a 3.5-times leverage target, while maintaining flexibility for share repurchases.

Outlook

Charter now expects pro forma full-year 2026 capital expenditures, excluding transition capital expenditures, to total approximately $13.0 billion versus its prior forecast of about $11.4 billion.

Charter Communications Stock Tanks

Charter Communications shares were down 5.34% at $119.45 at publication on Friday, according to Benzinga Pro data.

Photo: Shutterstock