MW Charter is bleeding internet subscribers - and the stock could see its worst day ever

By Steve Gelsi

A downbeat earnings report, plus investor disdain for the pending Cox Communications merger, is sending the stock to a one-year low

Charter Communications Inc.'s stock skidded toward its largest drop on record Friday, after the Spectrum-branded cable TV and internet company missed profit expectations amid ongoing subscription cancellations and as investors continued to express disdain for its pending merger with Cox Communications Inc.

The company (CHTR) said it had a net loss of 117,000 internet customers in the second quarter, bringing its total internet-customer count down to 29.9 million as of June 30. The losses in the quarter were much more than expected, as the average analyst estimate compiled by FactSet was for a loss of 70,400 subscribers.

Charter has now shed 746,000 broadband subscribers amid a seven-quarter streak of losses.

Chief Executive Chris Winfrey tried to reassure investors by saying on the postearnings conference call that he was confident the company would return to internet-customer growth "over time," according to a FactSet transcript.

But investors weren't buying it, as the stock plunged 18.2% in afternoon trading Friday, enough to lead the S&P 500 index's SPX decliners. Charter shares were also on track to break their current record for a one-day decline of 16.5%, set on Feb. 2, 2024.

The selloff spread to shares of Charter's industry peers, as Comcast Corp.'s stock (CMCSA) fell 4.9% Friday, while Altice USA Inc. shares (ATUS) dropped 9.2%.

Separately, the company also said it had a net loss of 80,000 video subscribers, much less than the FactSet consensus for a loss of 184,300, while the 220,000 voice subscribers it lost was better than expectations for a loss of 272,800. The company also added 500,000 mobile lines.

But for Charter investors, it's all about the internet - and the Cox deal, according to analysts.

"As always, the market's assessment of Charter's results - and, by extension, the market's assessment of the prospects for Charter's merger with Cox - will begin, and largely end, with broadband net adds," wrote MoffettNathanson analyst Craig Moffett in a note to clients.

Moffett said the merger with Cox has been "roundly panned" by investors, as the stock has meaningfully underperformed since it was announced on May 16.

Charter's stock got a one-day bump when the deal was announced, but has tumbled 25.9% since the day before the announcement. In comparison, Comcast shares have lost 4.8% over the same time, Altice's stock has declined 5.3% and the S&P 500 index has gained 8%.

Investors are worried about Cox's broadband average revenue per user (ARPU), which is higher than Charter's, and how that transition will be managed when the merger is completed.

"Charter has countered that lowering Cox's broadband ARPU will be, if not exactly painless, then at least manageable," Moffett wrote.

Meanwhile, the company reported second-quarter profits that rose to $1.3 billion, or $9.18 a share, from $1.23 billion, or $8.49 a share, in the year-ago quarter. That missed the FactSet consensus for earnings per share of $9.58.

Second-quarter revenue rose to $13.77 billion, from $13.69 billion in the year-ago quarter, and matched expectations.

So far this year, Charter's stock has dropped9.3%, while the S&P 500 has gained 8.7%.

Tomi Kilgore and Emily Bary contributed.

-Steve Gelsi

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July 25, 2025 15:20 ET (19:20 GMT)

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