CHTR · Q4 2025 Earnings
CautiousCharter Communications
Reported January 30, 2026
30-second summary
Charter lost another 119,000 internet customers in Q4 — the loss streak extends to four straight quarters — while revenue fell 2.3% YoY to $13.6B and adjusted EBITDA margin held at 41.8%. The first quantitative FY26 framework lands soft: "slight" EBITDA growth (with H1 explicitly weaker than H2), capex roughly flat at ~$11.4B, and management's explicit declaration that 2026 is the "last large build year." The convergence-and-FCF-inflection thesis from mid-2025 is still alive on the capex curve, but management's language pivoted from "return to growth over time" to "getting back to positive net additions is a game of inches."
Headline numbers
EPS
Q4 FY2025
$10.47
Revenue
Q4 FY2025
$13.60B
-2.3% YoY
Free cash flow
Q4 FY2025
$0.77B
Operating margin
Q4 FY2025
24.0%
Key financials
Q4 FY2025| Metric | Q4 FY2025 | YoY | Q3 FY2025 | QoQ |
|---|---|---|---|---|
| Revenue | $13.60B | -2.3% | $13.67B | -0.5% |
| EPS | $10.47 | — | $8.50 | +23.2% |
| Operating margin | 24.0% | — | 22.9% | +108bps |
| Free cash flow | $0.77B | — | $1.62B | -52.3% |
Guidance
Charter guides FY2026 with modest EBITDA growth, flat-to-slight CapEx decline, and explicit signal that subsidy-driven expansion ends after 2026.
Guidance is issued for both next quarter and the full year. Both may appear below.
New guidance
| Metric | Period | Guide | YoY |
|---|---|---|---|
| Capital Expenditures | FY2026 | approximately $11.4 billion | — |
| Adjusted EBITDA Growth | FY2026 | slight growth | — |
| Cash Tax Payments | FY2026 | $500 million to $800 million | — |
| Subsidized Rural Passings Growth | FY2026 | approximately 450,000 | — |
Segment performance
Q4 FY2025| Segment | Q4 FY2025 | YoY |
|---|---|---|
| Connectivity (Internet + Mobile) | $6.868B | +2.3% |
| Video | $3.246B | -10.3% |
| Voice | $0.316B | -10.3% |
| Commercial (Small Business + Mid-Market & Large Business) | $1.822B | +0.3% |
| Advertising Sales | $0.401B | -25.8% |
| Internet | $5.895B | +0.7% |
| Mobile Service | $0.973B | +13.1% |
Platform metrics
Q4 FY2025| Segment | Q4 FY2025 |
|---|---|
| Total Internet Customers | 29.680 million |
| Internet Customer Net Additions (Q4) | -119 thousand |
| Total Mobile Lines | 11.766 million |
| Mobile Lines Net Additions (Q4) | 428 thousand |
| Total Video Customers | 12.605 million |
| Total Customer Relationships | 31.846 million |
| Monthly Residential Revenue per Customer | $117.19 |
Profitability
Q4 FY2025| Segment | Q4 FY2025 |
|---|---|
| Adjusted EBITDA Margin | 41.8% |
Management tone
Mobile experiment → AI/FCF inflection → Q4 EBITDA warning and offer reset → "Game of inches" defensive posture
The growth narrative quietly died this quarter. In Q2, management said Charter would "return to internet customer growth over time." In Q3, that language was preserved but Q4 EBITDA was pre-warned. This quarter, Jessica's anchor framing is: "Getting back to positive net additions is a game of inches." That phrase is not a softening — it's a concession that the structural broadband subscriber bleed is not breaking on a near-term horizon. The shift from "when" to "inches" is the single most important tonal change in twelve months.
Management is now openly addressing the valuation discount. Last quarter Chris was reframing pricing discipline as forward asset. This quarter the rhetoric escalated: "To overcome the perception of negative perpetuity growth implied in our valuation today, we need to win in the marketplace." Management acknowledging a "negative perpetuity growth" discount embedded in the stock is striking — and signals they understand the bull case requires execution proof, not narrative.
The de-leveraging commitment is new and specific. Where prior quarters framed Cox-related capital structure flexibly, this quarter management committed to a post-close 3.5–3.75x leverage target within three years, explicitly citing "shareholders' preference for less leverage during a lower growth period." Translating shareholder feedback directly into a quantitative leverage floor is unusual for Charter and confirms the buyback-engine narrative is being tempered.
First-half 2026 was pre-warned, again. "First half 2026 EBITDA will be more challenged than second half EBITDA, given the one-time benefits we saw in one queue last year." Charter has now pre-warned weakness in two consecutive quarters (Q3 pre-warned Q4; Q4 pre-warns H1 2026). The pattern suggests guidance hygiene is improving — but also that the company keeps finding fresh near-term headwinds it hadn't disclosed prior.
Mobile competitive humility is new. Three quarters ago mobile was an unqualified tailwind. This quarter: "Net adds in the quarter were lower due to heavy device subsidy activity by the big telco competitors, including the new iPhone 17." This is the first quarter where Charter has attributed a specific mobile shortfall to competitor subsidy intensity — the convergence story is still intact but no longer immune to industry promotional cycles.
Recurring themes management leaned on this quarter:
Risks management surfaced:
Q&A highlights
Jessica Reif-Ehrlich · Bank of America
What is the sustainability of video subscriber gains, Q1 trends outlook, and what is Charter doing with Silicon Valley initiatives including product timing and goals?
Management clarified that video net gains are a means to support broadband acquisition and retention, not an end goal. Video growth is on the edge of volatility with high gross adds/disconnects. Silicon Valley initiative focuses on educating software developers about Charter's network capabilities (gigabit, symmetrical, multi-gig, low latency) to build products beyond least common denominator standards. Examples include Spectrum Front Row partnership with Apple/NBA and potential EV/edge compute applications. Management emphasized Charter's unique ubiquitous nationwide network advantage.
Michael Ng · Goldman Sachs
How is Charter balancing operating expense growth and investment opportunities (video, streaming apps, mobile, convergence) with EBITDA growth commitments and potential efficiency gains?
Management stated that prior infrastructure investments (pricing strategy, US-based sales/service, technology platforms) enable simultaneous innovation and efficiency. Cost of service customers expected to decline modestly year-over-year driven by operating efficiency and technology utilization. Marketing and resi sales expense expected to grow meaningfully slower than prior year due to prior investments and strategic messaging changes. Management can manage 'foot on the gas and brake simultaneously' while driving medium/long-term growth.
Michael Rollins · Citi
What is Charter's pricing strategy approach (everyday value pricing vs. promotional stack) and sustainability of current strategy?
Management detailed September 2024 repricing that lowered promotional and retail internet prices across tiers and bundles with 2-3 year price locks while maintaining/growing ARPA through higher product penetration (mobile, video bundles). 40% of footprint had new pricing at end of 2025, targeting 60% by end of 2026. Strategy leverages unique market position with mobile/video everywhere. Management provided specific ARPU guidance: Internet ARPU expected to grow but slower; Mobile ARPU declining but bottoming out sequentially; Video ARPU declining due to programmer streaming app allocation and tier mix. Emphasized pricing sustainability through product bundling economics rather than pure price increases.
Stephen Cahill · Wells Fargo
When will fiber overbuilders slow investment given they don't achieve ROI goals, and does Charter see promotional opportunity with $40 gig offers in the market?
Management reiterated that overbuilders (particularly telcos) prioritize 'going concern' returns over traditional financial ROI for 25+ years, making shareholder ROI secondary. This won't change soon. Natural throttling occurs as fiber density decreases and cost per passing increases, but management doesn't forecast specific slowdown timing. Clarified $40 gig offer is everyday pricing since September 2024, not new promotional activity, and credits it with driving high gig penetration in acquisitions. Not positioning for further promotional intensity.
Frank Luthan · Raymond James
How long will price locks be needed as competitive strategy, and how quickly can Cox customers reach Charter's baseline penetration levels?
Management stated price locks are both competitive response and customer confidence tool, here to stay with no planned changes, though evolution possible over time. On Cox customer penetration, management directed to Charter's Spectrum Mobile penetration curve but indicated expectations for faster ramp in early days due to Charter's improved operator capabilities (sales, marketing, brand awareness) versus 6-7 years ago. Improvement to original curve trajectory is reasonable expectation.
Answers to last quarter's watch list
What to watch into next quarter
Q1 2026 internet net losses — management has pre-warned H1 EBITDA weakness; another six-figure broadband loss combined with sequentially weaker EBITDA would test the "game of inches" framing. Threshold: a loss worse than -119k would signal acceleration of bleed, not stabilization.
FY26 revenue trajectory — with no dollar guide issued, the Q1 print becomes the first read on whether revenue declines worsen from FY25's -0.6%. Watch whether Internet revenue growth holds positive after decelerating from +2.8% to +1.7% to +0.7% across 2025.
Mobile net adds rebound from 428k — whether the iPhone 17 subsidy drag was a one-quarter event or a structural shift in mobile gross-add economics. Threshold: a return to ≥475k would suggest the drag was discrete.
Residential ARPU stabilization — $117.19 is the new base; whether it holds or compresses further as the Sept 2024 repricing migrates from 40% to 60% of the footprint by end of 2026.
Cox regulatory milestone and any first pro-forma capex envelope — still unanswered after three quarters of "no new news."
Streaming app allocation drag — whether the up-to-$1B headwind materializes in full or is mitigated by app activation tied to churn reduction.
Sources
- Charter Communications Q4 2025 Earnings Release, SEC 8-K Exhibit 99.1 — https://www.sec.gov/Archives/edgar/data/1091667/000109166726000016/chtrex991earningsrelease12.htm
- Charter Communications Q4 2025 earnings call prepared remarks and Q&A (referenced in guidance, tone, and Q&A extraction inputs).
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