Key financial results
- Pro forma total Charter revenue declined 1.5% year-over-year in the third quarter to down 1% when excluding both advertising revenue and program app GAAP allocation.
In total, pro forma consolidated third quarter revenue was down 1.5% year-over-year or 1% when excluding both the advertising revenue and program at GAAP allocation.
- Adjusted EBITDA declined 4% year-over-year in the quarter and declined 3% when excluding transition expenses.
Adjusted EBITDA declined 4% year-over-year in the quarter and declined 3% when excluding transition expenses.
- Pro forma net income declined from $1 billion in the third quarter of 2025 to a net loss of $2.1 billion in the third quarter of 2026, driven by a onetime noncash franchise impairment charge of approximately $6.3 billion.
Pro forma net income declined year-over-year from $1 billion in the third quarter of 2025 to a net loss of $2.1 billion in the third quarter of 2026.
- Pro forma capital expenditures totaled $3.2 billion including $33 million of transition capital expenditures.
Pro forma capital expenditures totaled $3.2 billion including $33 million of transition capital expenditures.
- Actual free cash flow generated in the third quarter was $674 million.
actual free cash flow, $674 million we generated in the third quarter.
Business segment results
- Residential: Legacy Charter residential revenue declined 2.7% year-over-year.
Over the last year, pro forma total Charter Residential revenue declined 2.7%.
- Internet: Legacy Charter lost 156,000 Internet customers in the third quarter compared to a loss of 109,000 in the prior year period.
Legacy Charter lost 156,000 customers more than last year's loss of 109,000.
- Mobile: Legacy Charter added 440,000 mobile lines during the third quarter.
During the third quarter, Legacy Charter added 440,000 mobile line
- Video: Legacy Charter video customers declined 38,000 compared to a loss of 70,000 in the third quarter of 2025.
In video, our 38,000 loss at legacy Charter was half the size of last year's third quarter loss
- Commercial: Legacy Charter mid-market and large business revenue grew 2.1% year-over-year, and small business revenue grew 0.1%.
- Cox: Legacy Cox lost 77,000 Internet customers and 39,000 video customers during the quarter while gaining 70,000 mobile lines.
Legacy Cox lost 77,000 Internet customers and 39,000 video customers during the quarter to gain 70,000 mobile lines.
Capital allocation
- The net debt-to-EBITDA ratio at the end of the third quarter was 3.93x.
our ratio of net debt to last 12 months adjusted EBITDA, excluding transition expense, was 3.93x as expected.
- Management reaffirmed the target net debt-to-EBITDA ratio of 3.5x to be achieved within three years of the close of the Cox and Liberty Broadband transactions.
Our leverage target is a net debt-to-EBITDA ratio 3.5x, which we expect to achieve within 3 years of the close of the Cox and Liberty Broadband transactions
- During the third quarter, the company executed a debt exchange that reduced debt principal by approximately $1.5 billion.
During the third quarter, we executed a debt exchange, which further reduced our debt principal by approximately $1.5 billion.
- During the quarter, Charter repurchased 140,000 shares totaling $19 million.
During the quarter, we repurchased 140,000 Charter shares, totaling $19 million at an average price of $135 per share
Industry trends and dynamics
- Management noted continued expanded fixed wireless competition, lower sales from lower-income consumers, ongoing mobile substitution, and fiber overlap at rates similar to prior quarters.
- Management has not observed meaningful share loss to Starlink, including in subsidized rural footprints, but continues to monitor it closely.
We haven't observed meaningful share loss to Starling, including in our subsidized rural footprint, but we continue to monitor it closely and take it seriously.
Competitive landscape
- Management emphasized that Charter operates America's Internet company with a fully deployed fiber-powered gigabit network that is 100% converged and multi-gig capable.
We are America's Internet company with the capability no other company has to deliver Internet to more Americans, a purpose that we call connecting gigabit America.
- Management stated that the company possesses unique mobile and video products supporting Internet customer growth, operating as the fastest-growing mobile provider in its footprint.
We also have unique mobile and video products that support Internet customer growth. And today, we're the fastest-growing mobile provider in our footprint in an increasingly converged world.
Macroeconomic environment
- Management did not discuss broader macroeconomic environment factors on the call aside from competitive consumer pressures.
Growth opportunities and strategies
- Management announced a new operating model focused on two priorities: returning the company to growth in its core business by winning more Internet customers, and transforming Charter into a simpler, more efficient organization.
Going forward, we'll maintain a relentless focus on two clear priorities: doubling down on returning our company to growth; and secondly, transforming Charter into a simpler, more efficient organization.
- The company is targeting an incremental $2 billion in annualized run rate operating expense savings over the next 18 months alongside more than $1 billion in transaction synergies from the Cox acquisition.
Financial guidance and outlook
- For full year 2026, total pro forma capital expenditures excluding transition CapEx are expected to total approximately $13 billion.
- For 2027, excluding transition capital, capital expenditures are expected to land at or below $11 billion.
when excluding transition capital, we expect 2027 capital expenditures to land at or below $11 billion
- Actual calendar year 2026 cash tax payments are expected to total between $500 million and $800 million.
We continue to expect our actual calendar year 2026 cash tax payments will total between $500 million and $800 million, even when including Cox.
- Management expects to exit 2026 below 3.9x leverage.
We expect to exit 2026 below 3.9x leverage.
Cox integration and operational transformation
- Charter closed its acquisition of Cox Communications on August 19, 2026, adding 11 million passes and over 5 million customers.
On August 19, we closed our acquisition of Cox Communications, adding 11 million passes and over 5 million customers
- Since the September 16 Spectrum Day launch in the legacy Cox footprint, Internet sales increased significantly, cutting run rate Internet losses at Cox by half.
since the launch of Spectrum Day on September 16, Internet sales were up significantly, already cutting the run rate Internet losses at COGS by half
- Nick Jeffrey joined Charter as Chief Operating Officer on September 1 to help implement the new operating model.
On September 1, Nick Jeffrey, the former CEO of Frontier and Vodafone U.K., joined Charter as our new Chief Operating Officer.
Q3 2026 results
| Metric | Result | Change |
|---|---|---|
| Legacy Charter Internet net additions | -156,000 | Compared to -109,000 year-over-year |
| Legacy Charter mobile line additions | 440,000 | Nearly 15% growth over 12 months |
| Pro forma total revenue | Down 1.5% | Year-over-year |
| Adjusted EBITDA | Down 3% | Excluding transition expenses year-over-year |
| Pro forma capital expenditures | $3.2 billion | Excluding transition CapEx |
How management sounded
Cautious (+10 on our -100 to +100 scale). Management acknowledged performance challenges and declining subscriber trends while outlining a comprehensive strategic transformation and synergy targets. Management sounded more upbeat than on 2% of the 302 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Read the analyst Q&A summary and guidance and outlook for this call.
What to watch before the next call
- The progress of the new operating model and transformation plan under the new COO.
- The pace of customer growth and churn reduction at both Legacy Charter and Legacy Cox footprints.
- The realization of the $1 billion in Cox transaction synergies and the additional $2 billion in cost savings.
- Deleveraging progress toward the 3.5x net debt-to-EBITDA target.
Earlier calls
- Q2 2026 (Jul 24, 2026), tone Cautious: Charter reported a 1.7% year-over-year revenue decline and lost 172,000 internet customers in the second quarter, while mobile lines grew by 406,000.
