Q3 2025 Charter Communications Inc Earnings Call

We will be given instructions for the question and answer session also as a reminder, this conference is being recorded today. If you have any objections. Please disconnect at this time I will.

I'll now turn the call over to Stefan <unk>.

Thanks, Leila and welcome everyone. The presentation that accompanies this call can be found on our website IR charter dot com I would like to remind you that there are a number of risk factors and other cautionary statements contained in our SEC filings and we encourage you to read them carefully.

Various remarks that we make on this call concerning expectations predictions plans and prospects constitute forward looking statements, which are subject to risks and uncertainties that may cause actual results to differ from historical or anticipated results any forward looking statements reflect management's current view only and charter undertakes no obligation to revise or update such.

Statements as a reminder, all growth rates noted on this call and in the presentation are calculated on a year over year basis, unless otherwise specified on today's call. We have Chris Winfrey, our president and CEO and Jessica Fisher, our CFO with that let's turn the call over to Chris. Thanks.

Thanks, Stephane during the <unk>.

Third quarter, we remain the fastest growing mobile provider in the United States. We added nearly 500000 spectrum mobile lines in the quarter and 2 million lines over the last 12 months over 20% growth.

Our video customer losses continued to improve to 70000 less than a quarter of last year's third quarter losses.

Driven by significant product improvements over the past two years.

Internet competition for new customers remains high.

Our third quarter Internet customer losses were in line with last year.

Revenue was down about 1% year over year, driven by customer losses, and a challenging political advertising comparison third.

Third quarter EBITDA declined by one 5% year over year, essentially flat when excluding advertising.

The operating environment for new sales in particular Internet continues to reflect low move rates and higher mobile substitution along with both expanded cell phone internet competition and fiber overlap growth similar to earlier in the year.

<unk> that drove third quarter Internet gross adds lower year over year.

Speaker #1: CHARTER CONFERENCE CALL. We ask that you please hold all questions until the completion of the formal remarks, at which time you will be given instructions for the question-and-answer session.

Operator: We ask that you please hold all questions until the completion of the formal remarks, at which time you will be given instructions for the question-and-answer session. Also, as a reminder, this conference is being recorded today. If you have any objections, please disconnect at this time. I will now turn the call over to Stefan Anninger.

Churn improved year over year as to be expected given last year's ACP related impacts and internet churn, including non pay churn remains at.

Speaker #1: Also, as a reminder, this conference is being recorded today. If you have any objections, please disconnect at this time. I will now turn the call over to Stefan Anninger.

At historically low levels.

From a medium and long term growth perspective, we know we have the best network fully capable everywhere, we operate with increasing demand for bandwidth and we have great products to help us win and the ability to save customers hundreds or even thousands of dollars a year.

Speaker #2: Thanks, Leila, and welcome, everyone. The presentation that accompanies this call can be found on our website, ir.charter.com. I would like to remind you that there are a number of risk factors and other cautionary statements contained in our SEC filings, and we encourage you to read them carefully.

Stefan Anninger: Thanks, Layla, and welcome, everyone. The presentation that accompanies this call can be found on our website, ir.charter.com. I would like to remind you that there are a number of risk factors and other cautionary statements contained in our SEC filings, and we encourage you to read them carefully. Various remarks that we make on this call concerning expectations, predictions, plans, and prospects constitute forward-looking statements, which are subject to risks and uncertainties that may cause actual results to differ from historical or anticipated results. Any forward-looking statements reflect management's current view only, and Charter undertakes no obligation to revise or update such statements. As a reminder, all growth rates noted on this call and in the presentation are calculated on a year-over-year basis unless otherwise specified. On today's call, we have Chris Winfrey, our President and CEO, and Jessica Fischer, our CFO.

In the short term with lower selling opportunities and new forms of competition small changes in sales or churn have an outsized impact on the internet net gains.

Speaker #2: Various remarks that we make on this call concerning expectations, predictions, plans, and prospects constitute forward-looking statements, which are subject to risks and uncertainties that may cause actual results to differ from historical or anticipated results.

We're leaving no stone unturned to drive customer and financial growth, including improved customer perception of our brand and products <unk>.

Brian mobile profitability and driving streaming video growth all with the focus to drive connectivity revenue growth.

Speaker #2: Any forward-looking statements reflect management's current view only, and CHARTER undertakes no obligation to revise or update such statements. As a reminder, all growth rates noted on this call and in the presentation are calculated on a year-over-year basis unless otherwise specified.

We're also improving our long term cost profile through our service and technology investments, including AI.

Beginning with go to market, we remain focused on better ways to message, our products and value savings, including our marketing and channel mix and testing new offers with international pricing and packaging structure.

Speaker #2: On today's call, we have Chris Winfrey, our President and CEO, and Jessica Fischer, our CFO. With that, let's turn the call over to Chris.

Stefan Anninger: With that, let's turn the call over to Chris.

Speaker #3: Thanks, Stefan. During the third quarter, we remained the fastest-growing mobile provider in the United States. We added nearly 500,000 Spectrum mobile lines in the quarter, and 2 million lines over the last 12 months, over 20% growth.

Chris Winfrey: Thanks, Stefan. During the third quarter, we remained the fastest-growing mobile provider in the U.S. We added nearly 500,000 Spectrum Mobile lines in the quarter and 2 million lines over the last 12 months, over 20% growth. Our video customer losses continued to improve to 70,000, less than a quarter of last year's third-quarter losses. That was driven by significant product improvements over the past two years. Internet competition for new customers remains high, and our third-quarter internet customer losses were in line with last year. Revenue was down about 1% year-over-year, driven by customer losses and a challenging political advertising comparison. Third-quarter adjusted EBITDA declined by 1.5% year-over-year, essentially flat when excluding advertising.

The new pricing and packaging, we launched in September of last year produces a higher number of total products sold per connect.

Our gig attach rate that is nearly doubled.

More mobile lines per customer connect and a video selling rate that has improved substantially with lower customer churn from bundling.

Despite lower selling opportunities given the macro backdrop, our yield on sales opportunities has steadily increased.

And various new offer expressions in our marketing mix are designed defined audience and drive more traffic to digital and traditional sales channels.

Saving customers money without sacrificing our revenue or cash flow potential at the household level.

Our marketing efforts combined with our improving products promotional in retail pricing and customer service have resulted in significant improvement in consumer perception scores over the past year.

Chris Winfrey: The operating environment for new sales, in particular internet, continues to reflect low move rates and higher mobile substitution, along with both expanded cell phone internet competition and fiber overlap growth similar to earlier in the year. Collectively, that drove third-quarter internet gross ads lower year-over-year. Churn improved year-over-year, as to be expected given last year's ACP-related impacts, and internet churn, including non-pay churn, remains at historically low levels. From a medium and long-term growth perspective, we know we have the best network, fully capable of where we operate with increasing demand for bandwidth, and we have great products to help us win and the ability to save customers hundreds or even thousands of dollars a year. In the short term, with lower selling opportunities and new forms of competition, small changes in sales or churn have an outsized impact on internet net gains.

Our service is backed by the investment in our 100% U S based sales and service workforce.

Increasing tenure of those employees in quality from better pay benefits and technology investment coupled.

Coupled with our market, leading an industry first customer commitment across our wireline and wireless services, which we back with service credits including for outages.

Or if we can't be at your home or business. The same day for service or at least next day for installation.

For service visits we're moving our internal standard to arrive at your doorstep within two hours of the service call. We're now achieving that a large percentage of the time.

All of which is helping to drive improved brand perception.

In mobile our broadband growth continues and for the last six quarters. The majority the majority of our line net adds have come from unlimited plus lines, which offer higher customer value and drive lower churn.

Chris Winfrey: We're leaving no stone unturned to drive customer and financial growth, including improved customer perception of our brand and products, growing mobile profitability, and driving streaming video growth, all with the focus to drive connectivity revenue growth. We're also improving our long-term cost profile through our service and technology investments, including AI. Beginning with go-to-market, we remain focused on better ways to message our products and value savings, including our marketing and channel mix and testing new offers within our national pricing and packaging structure. The new pricing and packaging we launched in September of last year produces a higher number of total products sold per connect, a gig attach rate that has nearly doubled, more mobile lines per customer connect, and a video sell-in rate that has improved substantially with lower customer churn from bundling.

We've also been selling more mobile lines per connect and additional lines to existing mobile households.

Convergence reduces internet churn and higher mobile lines per customer benefits churn further.

Increasingly the line between mobile and wireline connectivity is being blurred as our customers connect seamlessly between the two networks over.

Over the last 12 months, our total connectivity revenue grew by about 4%.

And 21% of our Internet customers are now converged, meaning they buy both on mobile and Internet products.

The profitability of our converged customers continues to grow.

And we don't treat mobile as a separate product, but if we did slide seven shows our fully loaded mobile service margin, excluding acquisition and Thats without the significant churn benefit to internet.

Chris Winfrey: Despite lower selling opportunities given the macro backdrop, our yield on sales opportunities has steadily increased, and various new offer expressions in our marketing mix are designed to find audience and drive more traffic to digital and traditional sales channels, saving customers money without sacrificing our revenue or cash flow potential at the household level. Our marketing efforts, combined with our improving products, promotional and retail pricing, and customer service, have resulted in significant improvement in consumer perception scores over the past year.

Mobile's financial contribution continues to grow with our scale and a 20% reduction in our reliance on macro cell towers over the past three years.

We are growing offload to faster networks, driven by the development of our spectrum mobile network with seamless authentication to nearly 50 million small cell towers through our advanced Wi Fi.

<unk> deployment and partner cable networks.

With 88% of spectrum mobile device traffic now on our own network the cable operators deliver more facilities based traffic and the traditional mobile carriers.

Chris Winfrey: Our service is backed by the investment in our 100% U.S.-based sales and service workforce, increasing tenure of those employees and quality for better pay, benefits, and technology investment, coupled with our market-leading and industry-first customer commitment across our wireline and wireless services, which we back with service credits, including for outages, or if we can't be at your home or business the same day for service or at least next day for installation. For service visits, we're moving our internal standard to arrive at your doorstep within two hours of the service call, and we're now achieving that a large percentage of the time, all of which is helping to drive improved brand perception. In mobile, our broadband growth continues, and for the last six quarters, the majority of our line net ads have come from unlimited plus lines, which offer higher customer value and drive lower churn.

Our marketing efforts combined with our improving products, Promotional and Retail pricing and customer service. Have resulted in significant Improvement in consumer, perception scores over the past year.

Hi Fi is essentially the backbone for all cellular traffic and <unk> macro cell towers are really our backup radios with lower speed and higher latency.

Our service is backed by the investment in our 100% us-based Sales and Service Workforce.

Increasing tenure of those employees and quality for better pay benefits and Technology investment.

We continue to evolve our fiber powered wireline network to deliver Internet service that offers more throughput, even less latency and greater reliability all at a great value.

Coupled with our Market, leading and industry. First customer commitment across our W line and wireless Services, which we back with service credits, including for outages.

Our network evolution initiative remains on track to deliver symmetrical and multi gig speeds across our entire footprint with convergence everywhere we operate.

or if we can't be at your home or business, the same day for service or at least next day for installation,

In early 2026, we'll launch our advanced Wi Fi complete product a tri band advanced Wi Fi seven router that integrates <unk> cellular and battery backup to keep customers seamlessly and fully connected during the service disruption or a powder power outage.

To arrive at your doorstep, within 2, hours of the service call. And we're now achieving that a large percentage of the time.

All of which is helping to drive improved brand perception.

We have also announced new <unk> partnerships that allow us secure auto connection to the spectrum mobile network, starting with Amazon and <unk>.

Chris Winfrey: We've also been selling more mobile lines per connect and additional lines to existing mobile households. Convergence reduces internet churn, and higher mobile lines per customer benefits churn further. Increasingly, the line between mobile and wireline connectivity is being blurred as our customers connect seamlessly between the two networks. Over the last 12 months, our total connectivity revenue grew by about 4%. And 21% of our internet customers are now converged, meaning they buy both our mobile and internet products. The profitability of our converged customers continues to grow. We don't treat mobile as a separate product, but if we did, slide 7 shows our fully loaded mobile service margin excluding acquisition, and that's without the significant churn benefit to internet. Mobile's financial contribution continues to grow with our scale and a 20% reduction in our reliance on macro cell towers over the past three years.

In Mobile, our broadband growth continues. For the last six quarters, the majority of our net adds have come from Unlimited Plus lines, which offer higher customer value and drive lower churn.

We've also been selling more mobile lines per connect, an additional lines to existing mobile households.

And we're exploring a wide range of PDP applications using the network assets highlighted on slide four including lower cost and higher performance data transport.

Convergence reduces internet, turn and higher mobile lines per customer benefits to earn further.

<unk> services and other consumer friendly uses of our capabilities.

Increasingly, the line between mobile and wireless connectivity is being blurred as our customers connect seamlessly between the two networks.

Our video product also continues to evolve and improve earlier. This month, we announced the launch of our spectrum App store, a digital marketplace for spectrum customers can discover activate manage and upgrade the apps included with respect from TV video plants.

Over the last 12 months, our total connectivity revenue grew by about 4%.

And 21% of our internet customers are now converged, meaning they buy both our mobile and internet products.

And non video customers can purchase DTC video apps Ala Carte.

The profitability of our converge customers continues to grow.

The stores accessible on my spectrum, App and on our website spectrum Dot net.

It's an important additional step in our effort to bring back utility and value to customers in the video ecosystem really for the benefit of our connectivity services.

and we don't treat mobile as a separate product, but if we did slide 7 shows, our fully loaded, mobile service margin, excluding acquisition and that's without the significant turn benefit to internet

With the combination of over $125 of included video App valuing our video product.

Chris Winfrey: We are growing offload to faster networks driven by the development of our Spectrum Mobile network with seamless authentication to nearly 50 million small cell towers through our advanced Wi-Fi, CBRS deployment, and partner cable networks. With 88% of Spectrum Mobile device traffic now on our own network, the cable operators deliver more facilities-based traffic than the traditional mobile carriers. Wi-Fi is essentially the backbone for all cellular traffic, and 5G macro cell towers are really our backup radios with lower speed and higher latency. We continue to evolve our fiber-powered wireline network to deliver internet service that offers more throughput, even less latency, and greater reliability, all at a great value. Our network evolution initiative remains on track to deliver symmetrical and multi-gig speeds across our entire footprint with convergence everywhere we operate.

Mobile Financial contribution continues to grow with our scale and a 20% reduction in our Reliance on macro cell towers over the past 3 years.

Unified search and discovery Zummo and.

In our digital marketplace, we're now more fully marketing our seamless entertainment packaging.

Slide nine shows our video customers are increasingly streaming customers through the award winning spectrum TV App and now included programmer streaming apps.

We are growing offload to faster, networks driven by the development of our Spectrum, mobile network with seamless authentication, to nearly 50 million, small cell towers through our Advanced Wi-Fi, cbrs deployment and partner cable networks.

Also earlier this month, we announced that we are partners with Apple to record and distribute a selection of immersive live Laker games.

With 88% of spectrum, mobile device traffic. Now, on our own network, the cable operators, deliver more facilities based traffic than the traditional mobile carriers.

Starting in January and I don't go to spectrum Internet and video customers in La <unk>, Nevada, and Hawaii, using the spectrum Sportsnet immersive app on the Apple vision for growth.

Wi-Fi is essentially the backbone for all cellular traffic and 5G macro cell towers. They are really our backup radios with lower speed and higher latency.

The same will be distributed nationally the next day, it's Robert footprint and on the NBA versus App.

Experiences amazing and you can see how immersive content will apply across next generation devices in the future.

We continue to evolve our fiber-powered wireline network to deliver internet service that offers more throughput, even less latency, and greater reliability, all at a great value.

And keep in mind that these immersive video streams films and 16 K require consistent throughput of 150 Megabits per second to the home even when distributed in 8-K for the application.

Chris Winfrey: In early 2026, we'll launch our Advanced Wi-Fi Complete product, a Tri-Band Advanced Wi-Fi 7 router that integrates 5G cellular and battery backup to keep customers seamlessly and fully connected during a service disruption or a power outage. We've also announced new B2B partnerships that allow secure auto-connection to the Spectrum Mobile network, starting with Amazon and Nexar, and we're exploring a wide range of B2B applications using the network assets highlighted on slide 4, including lower cost and higher performance data transport, authentication services, and other consumer-friendly uses of our capabilities. Our video product also continues to evolve and improve. Earlier this month, we announced the launch of our Spectrum App Store, a digital marketplace where Spectrum customers can discover, activate, manage, and upgrade the apps included with their Spectrum TV video plans, and non-video customers can purchase DTC video apps à la carte.

Our Network Evolution initiative remains on track to deliver symmetrical and multigig speeds across our entire footprint with convergence everywhere we operate.

Our fiber powered bandwidth rich network is ideally suited to deliver these kinds of immersive experiences, which require significant throughput benefit from lower latency.

In early 2026, we'll launch our Advanced Wi-Fi. Complete product, a triband advanced Wi-Fi, 7 router, that integrates 5G, cellular, and battery backup, to keep customers seamlessly and fully connected during the service, disruption or a powder power outage.

So we continue to believe our high quality video product with value and utility customers and the development of these bandwidth rich products can be yet another competitive advantage for our seamless connectivity products.

We've also announced new B2B partnerships that allow a secure auto connection to the Spectrum mobile network, starting with Amazon and Nexr.

Video also remains a significant driver of lower customer churn and it can help drive acquisition and the partnerships, we're recreating with programmers and believes.

And we're exploring a wide range of B2B applications. Using the network assets, highlighted on slide 4, including lower cost and higher performance data transport, authentication services and other consumer-friendly uses of our capabilities.

Benefits for all of US as we for example address the problem of whereas my game.

Most of what I've discussed this morning really relates to our products and how they'll drive help drive customer demand and revenue growth.

Our video product, also continues to evolve and improve earlier. This month, we announced the launch of our spectrum app store a digital marketplace, where Spectrum customers can discover activate manage and upgrade the apps included with respect and TV video plans.

But we're also deploying new technologies, which will transform the quality and economics of our $8 billion annual cost to serve.

Chris Winfrey: The store is accessible on my Spectrum app and on our website, spectrum.net. It's an important additional step in our effort to bring back utility and value to customers in the video ecosystem, really for the benefit of our connectivity services. With the combination of over $125 of included video app value in our video product, unified search and discovery in Zumo, and our digital marketplace, we're now more fully marketing our seamless entertainment packaging. Slide 9 shows our video customers are increasingly streaming customers through the award-winning Spectrum TV app and now included programmer streaming apps. Earlier this month, we announced that we're partnering with Apple to record and distribute a selection of immersive live Laker games starting in January. That'll go to Spectrum Internet and video customers in LA, Nevada, and Hawaii using the Spectrum SportsNet Immersive app on the Apple Vision Pro.

And non-video customers can purchase DTC video apps, Oligarch.

For years, we've meaningfully improved the quality of our service, while reducing service calls and truck rolls often at a double digit rate annually.

The store is accessible on my Spectrum app and on our website, spectrum.net.

We've reinvested those savings into frontline employee wages and benefits as well as technology and tools to enhance the quality of our service interactions with customers both of which have meaningfully improved service employee tenure and career progression.

It's an important additional step in our effort, to bring back utility and value to customers in the video, ecosystem really, for the benefit of our connectivity services.

With the combination of over $125 and included video app value in our video product.

Just a few of the currently deployed tools that we have include machine learning and AI for our network and in home telemetry to identify and address service issues before they ever occur.

Unified search and discovery and Zumo and our digital marketplace, we're now more fully marketing our seamless entertainment packaging.

Even more so with the deployment of signal and power transponders, which will occur as part of our network evolution initiative.

Slide 9 shows our video. Customers are increasingly streaming content through the award-winning Spectrum TV app, which now includes programming from streaming apps.

Another example is our unified front end for agents with real time call transcription, beating our AI models for what we call next best action presented it to the agent based on hundreds of real time and historical metrics.

Also, earlier this month, we announced that we're partnering with Apple to record and distribute a selection of immersive live Laker games.

Chris Winfrey: The same will be distributed nationally the next day throughout our footprint and on the NBA Immersive app. The experience is amazing, and you can see how immersive content will apply across next-generation devices in the future. Keep in mind that these immersive video streams filmed in 16K require consistent throughput of 150 megabits per second to the home, even when distributed in 8K for the Apple Vision Pro. Our fiber-powered, bandwidth-rich network is ideally suited to deliver these kinds of immersive experiences, which require significant throughput and benefit from lower latency. We continue to believe a high-quality video product with value and utility to customers and the development of these bandwidth-rich products can be yet another competitive advantage for our seamless connectivity products. Video also remains a significant driver of lower customer churn, and it can help drive acquisition.

Starting in January and that'll go to Spectrum internet and video customers in La, Nevada and Hawaii using the Spectrum Sports Net immersive app. On the Apple Vision Pro

That front and also integrates our spectrum GPT capabilities for the agent, which will move from current text conversational, prompting.

The same will be distributed nationally, the next day, throughout our footprint and on the NBA immersive app.

Our AI based customer sentiment measurement include supervisor tools to flag realtime agent support.

The experience is amazing and you can see how immersive content will apply across Next Generation devices in the future.

And subsequent agent specific training modules.

Our service calls also now have AI call summarization presented on call transfers for subsequent calls.

And keep in mind that these immersive video streams. Filmed in 16k require consistent, throughput of 150 megabits per second to the home even when distributed in 8k for the Apple Vision Pro,

And for fuel techs on job arrival.

We're also integrating network telemetry and AI will next best action and coaching from the field maintenance techs as well and.

Our fiber powered bandwidth Rich network is ideally suited to deliver these kinds of immersive experiences, which require significant throughput benefit from lower latency.

And you can imagine the upcoming positive effects of AI in areas like network monitoring dispatch and workforce planning. These are just a few isolated examples often seamless to our employees is it simply improves their job and it improves the service experience.

So, we continue to believe the high quality, video product with value and utility customers, and the development of these bandwidth, Rich products can be yet another competitive Advantage for our seamless connectivity products.

And charter.

These tools are all supported by the same unified dataset and tools development within our centralized operating model.

Chris Winfrey: The partnerships we're recreating with programmers and the leagues create benefits for all of us as we, for example, address the problem of, "Where's my game?" Most of what I've discussed this morning really relates to our products and how they'll help drive customer demand and revenue growth. We're also deploying new technologies, which will transform the quality and economics of our $8 billion annual cost to serve. For years, we've meaningfully improved the quality of our service while reducing service calls and truck rolls, often at a double-digit rate annually. We've reinvested those savings into frontline employee wages and benefits, as well as technology and tools to enhance the quality of our service interactions with customers, both of which have meaningfully improved service employee tenure and career progression.

All of that reflects where we are today and in the coming months.

Video also remains a significant driver of lower customer churn, and it can help drive acquisition and partnerships. We're recreating great benefits for all of us with programmers and the leagues as we, for example, address the problem of "Where's my game?"

But just over the past few months, we've seen rapid investments in our <unk> AI technology, such that we're focusing our efforts with a few key partners going into 2026 to integrate our existing capabilities into a more attentive service the.

Most of what I've discussed this morning really relates to our products and how they'll help drive customer demand and revenue growth.

The recent advancements most relevant to us include short and long term memory.

But we're also deploying new technologies that will transform the quality and economics of our $8 billion annual cost to serve.

Handling multiple customer issues and prioritization.

Multimodal and multichannel service, including our internal service channels and over time the customers chosen interface.

For years, we've meaningfully improved the quality of our service while reducing service calls and truck roles often at a double-digit rate annually.

And the goal is first to have a better customer experience at every implementation.

And then to significantly lower operating cost with even higher tenured service employees because the quality of the job is enhanced.

We've reinvested those savings into Frontline employee wages and benefits as well as technology and tools, to enhance the quality of our services interactions with customers. Both of which have meaningfully improved Service, employee, tenure and career progression.

Chris Winfrey: Just a few of the currently deployed tools that we have include machine learning and AI for our network and in-home telemetry to identify and address service issues before they ever occur, even more so with the deployment of signal and power transponders, which will occur as part of our network evolution initiative. Another example is our unified front end for agents with real-time call transcription, feeding our AI models for what we call next best action presentment to the agent based on hundreds of real-time and historical metrics. That front end also integrates our Spectrum GPT capabilities for the agent, which will move from current text to conversational prompting. Our AI-based customer sentiment measurement includes supervisor tools to flag real-time agent support and subsequent agent-specific training modules.

All the virtuous cycle to lower service transactions and cost and improve customer satisfaction churn and customer growth.

The prospect for <unk> AI tools for our back office employees and software developers has also rapidly increasing those will be separate work streams within the company.

Just a few of the currently deployed tools that we have include machine learning and AI for our Network, and in-home Telemetry to identify and address service issues before they ever occur. Even more. So with the deployment of signal and power transponders, which will occur as part of our Network Evolution initiative.

Benefits still probably 12 to 18 months away, but we believe the impact can be real and material and we'll plan on updating progress on future calls.

another example, is our unified front end for agents, with real-time call transcription, feeding our AI models, for what we call next best action presentment to the agent based on hundreds of real-time and historical metrics

So the current operating environment is driving us everyday to perform better and we are whether it's continued improvement in our network and product capabilities adapting our marketing strategy defined audience and drive traffic into temporarily challenging macro and competitive environment.

That front end also integrates our Spectrum, GPT capabilities for the agent which will move from current text to conversational prompting.

Our AI based customer sentiment measurement include supervisor tools to flag real-time agent support.

We're improving execution of our customer service commitments to all the efforts I mentioned, we're becoming a better operator everyday consumers are noticing as evidenced by our improving branch perception.

Chris Winfrey: Our service calls also now have AI call summarization presented on call transfers or subsequent calls and for field techs on job arrival. We're also integrating network telemetry, and AI will prompt next best action and coaching for the field of maintenance techs as well. You can imagine the upcoming positive effects of AI in areas like network monitoring, dispatch, and workforce planning. These are just a few isolated examples, often seamless to our employees as it simply improves their job and it improves the service experience. At Charter, these tools are all supported by the same unified data set and tools development within our centralized operating model. All of that reflects where we are today and in the coming months.

And subsequent agents specific training modules.

Our service calls also now have ai call summarization presented on call transfers or subsequent calls.

All of that effort is in support of our core strategy of offering the best products, including seamless connectivity and seamless entertainment the most value.

And for field texts on job arrival.

With unmatched service.

We're also integrating network telemetry, and AI will prompt the next best action and coaching for the field of maintenance in Texas as well.

Ultimately those efforts and our differentiated network will drive perpetuity free cash flow growth, which remains our focus for shareholder value creation.

Now I'll pass it over to Jessica.

Thanks, Chris.

Let's please turn to our customer results on slide 11.

And you can imagine the upcoming positive effects of AI in areas like network monitoring, dispatch, and workforce planning. These are just a few isolated examples, often seamless to our employees, as it simply improves their job and enhances the service experience.

Including residential and small business, we lost 109000 internet customers in the quarter in line with last year's results at low Irwin testing during the last years impact in ACP related disconnects.

And Charter. These tools are all supported by the same unified data set and tools development within our centralized operating model.

Chris Winfrey: Just over the past few months, we've seen rapid investments in agentic AI technology such that we're focusing our efforts with a few key partners going into 2026 to integrate our existing capabilities into a more agentic service. The recent advancements most relevant to us include short and long-term memory, handling multiple customer issues and prioritization. Multimodal and multi-channel service, including our internal service channels, and over time, the customer's chosen interface. The goal is first to have a better customer experience at every implementation and then to significantly lower operating cost with even higher tenured service employees because the quality of the job is enhanced. All a virtuous cycle to lower service transactions and cost and improve customer satisfaction, churn, and customer growth.

All of that reflects where we are today and in the coming months.

In mobile we added 493000 line with high aircraft additions year over year offset by disconnects on a larger base.

Video customers declined by 70000 versus a loss of 294000 or <unk> 25.

But just over the past few months uh we've seen rapid investments in a gentic AI technology, such that we're focusing, our efforts with a few key Partners going into 2026 to integrate our existing capabilities into a more authentic service.

The recent advancements of most relevant to us include short and long-term memory.

With the improvement primarily driven by better connects year over year, resulting from the new pricing and packaging and relaunched last.

Handling, multiple customer issues and prioritization.

And the various product improvement and Chris covered.

And lower churn year over year, driven in part by a programmer app inclusion packaging.

Multimodal and multi-channel service, including our internal service channels. And over time, the customers chose an interface

Wireline voice estimates declined by 200000.

And the goal is first to have a better customer experience at every implementation.

In <unk>, we continue to see accelerating customer relationship with.

And then to significantly lower operating costs with even higher tenured service employees because the quality of the job is enhanced.

We generated 52000 net customer additions in our subsidized royalty and in the quarter.

And in the third quarter, we grew our subsidize for own path.

Chris Winfrey: The prospect for agentic AI tools for our back-office employees and software developers has also rapidly increased, and those will be separate work streams within the company. The benefits are still probably 12 to 18 months away, but we believe the impact can be real and material, and we'll plan on updating progress on future calls. The current operating environment is driving us every day to perform better, and we are, whether it's continued improvement in our network and product capabilities, adapting our marketing strategy to find audience and drive traffic in a temporarily challenging macro and competitive environment. We're improving execution of our customer service commitments through all the efforts I mentioned. We're becoming a better operator every day. Consumers are noticing, as evidenced by our improving brand perception.

All of virtuous cycle to lower service, transactions, and cost and improve customer satisfaction turn and customer growth.

In 2004 thousand and by over 453000 over the last 12 months.

We continue to expect subsidized Rob Hopkins.

The prospect for agentic AI tools for our back office employees and software developers has also rapidly increased and those will be separate work streams within the company.

<unk> 450000 in 2025.

Addition to continued non wrong construction and turnaround activity.

The benefits still probably 12 to 18 months away but we believe the impact can be real and material and we'll plan on updating progress, on future calls.

The bead bidding process is largely complete we built in 20 different states and were awarded subsidy is associated with approximately 84000 patents in total we expect to spend approximately $230 million of our own capital net of subsidy to build out those pass things over the next several years.

Moving to third quarter revenue results on slide 12 over the last year residential customers declined by two 1%.

Chris Winfrey: All of that effort is in support of our core strategy of offering the best products, including seamless connectivity and seamless entertainment, the most value with unmatched service. Ultimately, those efforts and our differentiated network will drive perpetuity-free cash flow growth, which remains our focus for shareholder value creation. Now I'll pass it over to Jessica. Thanks, Chris. Let's please turn to our customer results on slide 11. Including residential and small business, we lost 109,000 internet customers in the third quarter, in line with last year's results, but lower when adjusted to remove last year's impact from ACP-related disconnects. In mobile, we added 493,000 lines with higher gross additions year over year, offset by disconnects on a larger base.

So the current operating environment is driving us every day to perform better, whether it's through continued improvement in our network and product capabilities or adapting our marketing strategy to find our audience and drive traffic in a temporarily challenging macro and competitive environment. We're improving the execution of our customer service commitments. Through all the efforts I mentioned, we're becoming a better operator every day. Consumers are noticing, as evidenced by our improving brand perception.

And wellness, while residential revenue per customer relationship grew by 1% year over year, given promotional rates step up rate adjustments and the growth in spectrum mobile lines.

All of that effort is in support of our core strategy, of offering the best products, including seamless connectivity and seamless entertainment, the most value.

With unmatched service.

These factors were partly offset by a higher mix of non video customers growth of low priced video packages within our base.

And ultimately those efforts. And our differentiated network will drive, perpetuity free cash flow growth, which remains our Focus for shareholder value creation.

Now, I'll pass it over to Jessica.

And $106 million of costs allocated to programmer streaming apps and netted within video revenue versus $25 million in the prior year period.

Thanks Chris.

That allocation should grow over time as more customers authenticate into our streaming application offerings that is neutral to EBITDA.

We lost 109,000 internet customers in the third quarter.

In line with last year's results. But lower when adjusted to remove last year's impact from ACP related disconnects.

On Slide 12 says in total residential revenue declined by one 1% and by 4% when excluding costs allocated to streaming apps embedded within video revenue in both periods.

Chris Winfrey: Video customers declined by 70,000 versus a loss of 294,000 in Q3 of 2024, with the improvement primarily driven by better connects year over year, resulting from the new pricing and packaging we launched last fall and the various product improvements that Chris covered, and lower churn year over year, driven in part by our programmer app inclusion packaging. Wireline voice customers declined by 200,000. In rural, we continue to see accelerating customer relationship growth. We generated 52,000 net customer additions in our subsidized rural footprint in the quarter. In the third quarter, we grew our subsidized rural passings by 124,000 and by over 453,000 over the last 12 months. We continue to expect subsidized rural passings growth of approximately 450,000 in 2025, in addition to continued non-rural construction and fill-in activity. The B bidding process is largely complete.

In Mobile, we added 493,000 lines with higher gross, editions year-over-year offset by disconnects on a larger base.

Turning to commercial revenue total commercial revenue grew by 9% year over year.

Video customers declined by 70,000 versus a loss of 294,032 of 24.

With mid market and large business revenue growth of three 6%.

With the Improvement, primarily driven by better connects year-over-year, resulting from the new pricing and packaging. We launched last fall and the various product improvements that Chris covered.

And when excluding all wholesale revenue mid market and large business revenue grew by 4%.

And lowered return year-over-year driven in part by our programmer app. Inclusion Packaging.

Small business revenue declined five 9%, reflecting a decline in small business customers with revenue per customer and remaining essentially flat year over year.

W-line voice customers declined by 200,000.

Third quarter advertising revenue declined by 21%, including the impact of less political.

In rural, we continue to see accelerating customer relationship growth. We generated 52,000 net customer additions in our subsidized, rural footprint in the quarter.

Excluding political advertising revenue decreased five 5% with national and local advertising market challenges, partly offset by our higher advanced advertising and better inventory selling capability.

And in the third quarter, we grew our subsidized rural, passing by 124,000 and by over 453,000 over the last 12 months.

Other revenue grew by 10, 7%, primarily driven by higher mobile device now.

We continue to expect subsidized rural passengers, growth of approximately 450,000 in 2025. In addition to continued non-rural Construction in villain activity.

Chris Winfrey: We bid in 20 different states and were awarded subsidies associated with approximately 84,000 passings. In total, we expect to spend approximately $230 million of our own capital net of subsidies to build out those passings over the next several years. Moving to third-quarter revenue results on slide 12. Over the last year, residential customers declined by 2.1%. While residential revenue per customer relationship grew by 1% year over year, given promotional rate step-ups, rate adjustments, and the growth of Spectrum Mobile lines, those factors were partly offset by a higher mix of non-video customers, growth of low-priced video packages within our base, and $106 million of costs allocated to programmer streaming apps and netted within video revenue versus $25 million in the prior year period. That allocation should grow over time as more customers authenticate into our streaming application offers, but it's neutral to EBITDA.

In total consolidated third quarter revenue was down 9% year over year.

<unk> grew 4% when excluding advertising revenue and costs allocated to streaming apps and netted within video revenue in both periods.

Moving to operating expenses and adjusted EBITDA on Slide 13 in the third quarter total operating expenses decreased by 5% year over year.

The bead bidding process is largely complete. We bid in 20 different states and were awarded subsidies associated with approximately 84,000 passings in total. We expect to spend approximately $230 million of our own capital, net of subsidies, to build out those passings over the next several years.

Programming costs declined by six 5% due to a three 5% decline in video customers year over year.

Moving to the third quarter, revenue results on slide 12 over the last year, residential customers declined by 2.1%.

A higher mix of lighter video packages and $106 million in costs allocated to programmers streaming apps and netted within video revenue, partly offset by higher programming rates.

And while, while residential Revenue per customer relationship, grew by 1% year-over-year, given promotional rates Step Up rate adjustments and the growth of spectrum mobile lines.

Other cost of revenue increased by four 6%, primarily driven by higher mobile service direct costs and mobile device down partly offset by lower franchise and regulatory fees and lower advertising sales costs, given lower political activity.

Those factors were partly offset by a higher mix of non-video customers and growth of low-priced video packages within our base.

And 106 million dollars of costs allocated to programmer streaming apps and netted within video Revenue versus 25 million in the prior year period.

Cost to service customers, which combined field and technology operations and customer operations decreased 7% year over year, primarily due to lower bad debt expense and labor costs.

That allocation should grow over time as more customers like our streaming application offers, but is neutral to Ion.

Chris Winfrey: As slide 12 shows, in total, residential revenue declined by 1.1% and by 0.4% when excluding costs allocated to streaming apps and netted within video revenue in both periods. Turning to commercial revenue, total commercial grew by 0.9% year over year, with mid-market and large business revenue growth of 3.6%. When excluding all wholesale revenue, mid-market and large business revenue grew by 4%. Small business revenue declined by 0.9%, reflecting a decline in small business customers, with revenue per customer remaining essentially flat year over year. Third-quarter advertising revenue declined by 21%, including the impact of less political. Excluding political, advertising revenue decreased by 0.5%, with national and local advertising market challenges partly offset by our higher advanced advertising and better inventory selling capabilities. Other revenue grew by 10.7%, primarily driven by higher mobile device sales.

Offset by higher network utility costs.

Excluding bad debt cost to service customers was essentially flat year over year.

As slide 12 shows in total residential Revenue declined, by 1.1%. And by 0.4%, when it excluding costs allocated to streaming apps and netted within video Revenue in both periods,

Marketing and residential sales expense grew by five 4% due to some higher marketing spend with dramatically higher impressions at lower cost and continued channel mix shift from lower cost channels like in house call centers to digital NSA lands.

Turning to commercial revenue, total commercial grew by 0.9% year-over-year.

With mid-market and large business Revenue. Growth of 3.6%.

And when excluding all wholesale revenue, mid-market and large business Revenue, grew by 4%.

Finally, other expense increased by 7%.

Adjusted EBITDA declined by one 5% year over year in the quarter and was essentially flat when excluding advertising.

Small business revenue declined by 0.9%, reflecting a decline in small business customers, with revenue per customer remaining essentially flat year-over-year.

We expect 2025 full year EBITDA growth to be flat or marginally positive year over year with higher underlying growth absent the impact of political advertising.

Quarterly Revenue decline by 21% including the impact of less political

And EBIT growth in the fourth quarter will be pressured by at least as much as it was in the third quarter given last year's political advertising strength and the same macro pressures we saw in the third quarter.

Excluding political advertising, revenue decreased by 0.5% across national and local markets. Advertising market challenges were partly offset by our higher advanced advertising and better inventory selling capabilities.

Chris Winfrey: In total, consolidated third-quarter revenue was down 0.9% year over year and grew 0.4% when excluding advertising revenue and costs allocated to streaming apps and netted within video revenue in both periods. Moving to operating expenses and adjusted EBITDA on slide 13. In the third quarter, total operating expenses decreased by 0.5% year over year. Programming costs declined by 6.5% due to a 3.5% decline in video customers year over year, a higher mix of lighter video packages, and $106 million of costs allocated to programmer streaming apps and netted within video revenue, partly offset by higher programming rates. Other costs of revenue increased by 4.6%, primarily driven by higher mobile service direct costs and mobile device sales, partly offset by lower franchise and regulatory fees and lower advertising sales costs given lower political activity.

Other Revenue, grew by 10.7%, primarily driven by higher mobile device sales.

Turning to net income we generated $1 $1 billion of net income attributable to charter shareholders in the third quarter compared to $1 $3 billion last year.

Given this quarter's lower adjusted EBITDA and higher other operating expenses Gen by merger and acquisition costs related to the pending Cox transaction and severance costs.

In total Consolidated. Third quarter Revenue was down 0.9%, year-over-year and grew 0.4%. When excluding advertising revenue and costs to allocated to streaming apps and netted within video Revenue in both periods.

Turning to slide 14 capital expenditures totaled a bit less than $3 $1 billion in the third quarter.

Moving to operating expenses and adjusted, Evita on slide 13 in the third quarter. Total operating expenses decreased by 0.5% year-over-year.

Nearly $500 million higher than last year's third quarter due to CPE spend timing and higher network evolution spend.

In costs declined by 6.5% due to a 3.5% decline in video customers year-over-year.

We continue to expect total 2025 capital expenditures to reach approximately $11 $5 billion lower than our original outlook of $12 million, primarily as the result of some network evolution capital pushed into 2026.

As.

Despite that push our goal is to ensure that 2025 is the peak capital year, even if by a small margin.

And aside from the network evolution timing variance our previous commentary on capital outlook on a standalone basis remains the same.

Cost of Revenue increased by 4.6%, primarily driven by higher mobile service, direct costs and mobile device sales partly offset by lower franchise, and Regulatory fees and lower advertising sales costs, given lower political activities.

Chris Winfrey: Cost-to-service customers, which combines field and technology operations and customer operations, decreased 0.7% year over year, primarily due to lower bad debt expense and labor costs, partly offset by higher network utility costs. Excluding bad debt, cost-to-service customers was essentially flat year over year. Marketing and residential sales expense grew by 5.4% due to some higher marketing spend, with dramatically higher impressions at lower cost and continued channel mix shift from lower-cost channels like in-house call centers to digital and affiliates. Finally, other expense increased by 0.7%. Adjusted EBITDA declined by 1.5% year over year in the quarter and was essentially flat when excluding advertising. We expect 2025 full-year EBITDA growth to be flat or marginally positive year over year, with higher underlying growth absent the impact of political advertising.

Further even including the impact of the Cox transaction and associated integration capital. We expect total combined company capital expenditures to decline in the first full calendar year post close.

Network utility costs.

Excluding bad debt, the cost to service customers was essentially flat year-over-year.

All of those statements are inclusive of the bead spending I mentioned earlier.

Turning to free cash flow on slide 15 third quarter free cash flow totaled $1 6 billion in line with prior year, given higher capex offset by lower cash taxes, and a more favorable change in cable working capital tied to CPE spend some of which will reverse in <unk>.

Residential sales expense grew by 5.4% due to higher marketing spend, with dramatically higher impressions at a lower cost, and a continued channel mix shift from lower cost channels, like in-house call centers, to digital and affiliates.

Finally, other expense increased by 7%.

And we expect full year change in cable working capital to be modestly positive.

Turning to quarterly and full year 2025, cash taxes third quarter cash taxes totaled $53 million and we expect full year cash tax payments to total approximately $1 billion.

Adjusted even to decline by 1.5% year-over-year in the quarter and was essentially flat when excluding advertising.

Chris Winfrey: EBITDA growth in the fourth quarter will be pressured by at least as much as it was in the third quarter, given last year's political advertising strength and the same macro pressures we saw in the third quarter. Turning to net income, we generated $1.1 billion of net income attributable to Charter shareholders in the third quarter compared to $1.3 billion last year, given this quarter's lower adjusted EBITDA and higher other operating expenses driven by merger and acquisition costs related to pending Cox transactions and severance costs. Turning to slide 14, capital expenditures totaled a bit less than $3.1 billion in the third quarter, nearly $500 million higher than last year's third quarter due to CPE spend timing and higher network evolution spend.

We expect 2025 full year ebit growth to be flat or marginally positive year-over-year with higher underlying growth absent, the impact of political advertising.

We finished the third quarter with 95 billion in debt principal our weighted average cost of debt remains at an attractive five 2% and our current run rate annualized cash interest is $4 $9 billion.

And even a growth in the fourth quarter will be pressured by at least as much as it was in the third quarter, given last year's political advertising strengths and the same macro pressures. We saw in the third quarter,

During the quarter, we repurchased seven 6 million charter shares and charter holdings common units totaling $2 $2 billion at an average price of $292 per share.

Turning to net income, we generated 1.1 billion dollars of net income attributable, to Charter shareholders in the third quarter, compared to 1.3 billion dollars last year.

As of the end of the third quarter, our ratio of net debt to last 12 month adjusted EBITDA increased sequentially to one five times and stood at 423 times pro forma for the pending Liberty broadband transaction.

given this quarter's lower adjusted Ava and higher other operating expenses driven by merger and acquisition costs related to the pending Cox transaction and Severance costs

As I've noted before during the pendency of the Cox deal, we plan to be at or slightly under four to five times leverage pro forma for the Liberty transaction.

Chris Winfrey: We continue to expect total 2025 capital expenditures to reach approximately $11.5 billion, lower than our original outlook of $12 billion, primarily as the result of some network evolution capital pushed into 2026. Despite that push, our goal is to ensure that 2025 is the peak capital year, even if by a small margin. Aside from the network evolution timing variance, our previous commentary on capital outlook on a standalone basis remains the same. Further, even including the impact of the Cox Communications transaction and associated integration capital, we expect total combined company capital expenditures to decline in the first full calendar year post-close. All of those statements are inclusive of the B spending I mentioned earlier.

Turning to slide 14, capital expenditures totaled a bit less than $3.1 billion in the third quarter, nearly $500 million higher than last year's third quarter due to CPE spending and higher network evolution spending.

Post close however, we will move our long term target leverage to three five to four times and we would expect to deleverage in the middle of that range within two to three years following close.

We continue to expect total 2025 capital expenditures to reach approximately $11.5 billion, lower than our original outlook of $12 billion. This is primarily due to some network evolution capital being pushed into 2026.

Okay.

Before moving to Q&A I wanted to remind everyone that as our capital spending peaks this year and as we begin to benefit from President Trump's new tax legislation, we are poised for rapid free cash flow and free cash flow per share growth over the next several years.

despite that push, our goal is to ensure that 2025 is the peak Capital year even if by a small margin

And aside from the network evolution timing variance, our previous commentary on Capitol outlook on a standalone basis remains the same.

Slide 16 lays that phenomenon out very clearly.

And with the additional upside potential and future EBIT growth or declining standalone share count and the powerful economic and strategic benefits at our Cox transaction. The pro forma entity will generate higher free cash flow per share in spite of delevering, which will reduce our cost of capital.

Further even including the impact of the Cox transaction and Associated integration Capital. We expect total combined company Capital expenditures to decline in the First full calendar year. Post close.

All of those statements are inclusive of the bead spending I mentioned earlier.

Chris Winfrey: Turning to free cash flow on slide 15, third-quarter free cash flow totaled $1.6 billion, in line with prior year, given higher CapEx, offset by lower cash taxes, and a more favorable change in cable working capital tied to CPE spend, some of which will reverse in Q4. We expect full-year change in cable working capital to be modestly positive. Turning to quarterly and full-year 2025 cash taxes, third-quarter cash taxes totaled $53 million. We expect full-year cash tax payments to total approximately $1 billion. We finished the third quarter with $95 billion in debt principal. Our weighted average cost of debt remains at an attractive 5.2%, and our current run rate annualized cash interest is $4.9 billion. During the quarter, we repurchased 7.6 million Charter Communications shares and Charter Holdings common units totaling $2.2 billion at an average price of $292 per share.

And as Chris mentioned sustainable free cash flow as our key focus metric for delivering shareholder value.

With that I'll turn it over to the operator for Q&A.

Thank you at this time, if you would like to ask a question. Please click on the raise hand button, which can be found on the black bar at the bottom of your screen.

Turning to free cash flow on July 15, third quarter of free, cash flow totaled. 1.6 billion in line with prior year. Given higher capex offset by lower cash taxes and a more favorable change in cable, working capital tied to CPE, spend. Some of which will reverse in 4 q.

And we expect the full-year change in cable working capital to be modestly positive.

One is this return you will receive a message on your screen from the house, allowing you to talk and then you will hear your name called please accept Amit your audio and ask your question.

Turning to quarterly and full year 2025 cash taxes. Third quarter, cash taxes, totaled. 53 million.

As a reminder, we are allowing analysts to ask one question today, we believe one moment to allow the QD form.

And we expect full year, cash tax payments to Total approximately 1 billion dollars.

Our first question will come from Craig Moffett with Moffat Nathanson. Please on mute and ask your question.

Okay.

We finished the third quarter with 95 billion dollars in debt. Principal our weighted average cost of debt remains in an attractive 5.2% and our current run rate, annualized cash interest is 4.9 billion.

Craig Your line is now open you're able to meet on your side when you're ready.

Sorry about that.

Good morning.

Chris Winfrey: As of the end of the third quarter, our ratio of net debt to last 12-month adjusted EBITDA increased sequentially to 4.15 times and stood at 4.23 times pro forma for the pending Liberty Broadband transaction. As I've noted before, during the pendency of the Cox Communications deal, we plan to be at or slightly under 4.25 times leverage pro forma for the Liberty Broadband transaction. Post-close, however, we will move our long-term target leverage to 3.5 to 4 times, and we would expect to deleverage to the middle of that range within two to three years following close. Before moving to Q&A, I wanted to remind everyone that as our capital spending peaks this year and as we begin to benefit from President Trump's new tax legislation, we are poised for rapid free cash flow and free cash flow per share growth over the next several years.

Chris I Wonder if you could just sort of help us think about.

During the quarter. We repurchased 7.6 million Charter, shares, and Charter Holdings. Common units. Totaling 2.2 billion dollars and an average price of 292 per share.

Where broadband is is getting better.

So that we can sort of get our minds around.

Your arguments that that things are going to improve on the broadband side.

As of the end of the third quarter, our ratio of net debt to last 12-month adjusted ebita increased sequentially to 4.15 times and stood at 4. 2 3.

Is it in areas, where you've completed your high splits can you share. Some some some data that suggests that.

As I've noted before, during the pendency of the Cox deal, we plan to be at or slightly under 4.25 times leverage, proforma for the Liberty transaction.

That your market share or market retention is improving you talked about voluntary versus involuntary churn.

Last quarter end.

And your voluntary churn metrics being.

Being best ever I Wonder if you could just sort of help us sort of frame why we should be optimistic about improving results.

Before moving to Q&A.

Sure.

But just to tackle both of those quickly then I think it's probably best to give a more global look the the high split is going well, but we're not actively marketing the capabilities until we get further down the road from a national perspective, just to make sure that we are.

Chris Winfrey: Slide 16 lays that phenomenon out very clearly. With the additional upside potential from future EBITDA growth, a declining standalone share count, and the powerful economic and strategic benefits of our Cox Communications transaction, the pro forma entity will generate higher free cash flow per share in spite of deleveraging, which will reduce our cost of capital. As Chris mentioned, sustainable free cash flow is our key focus metric for delivering shareholder value. With that, I'll turn it over to the operator for Q&A. Thank you. At this time, if you would like to ask a question, please click on the raise hand button, which can be found on the black bar at the bottom of your screen. When it is your turn, you will receive a message on your screen from the host allowing you to talk, and then you will hear your name called.

That is our Capital spending Peaks this year. And as we begin to benefit from president, Trump's new tax legislation, we are poised for Rapid free cash flow and free cash flow per share growth over the next several years.

Slide 16 leighs that phenomenon out very clearly.

On track there so theres really nothing to report there were churn is definitely better is to the extent that we have a mobile relationship and to the extent we have more lines per mobile relationship. The impact is significant on the churn impact and then in addition to that which has always been the case in cable to the extent you have a video relationship attached.

And with the additional upside Potential from future ibida growth, a declining Standalone share count and the powerful economic and strategic benefits of our cocks transactions. The proforma Entity will generate Higher free cash flow per share in spite of de-levering which will reduce our cost of capital.

Mentioned sustainable free cash flow is our key focus metric for delivering shareholder value.

With that, I'll turn it over to the operator for Q&A.

To that but now what we're seeing is the additional activation of these direct to consumer apps, which are included as part of the offer to the extent when that occurs and it's meaningful.

Thank you at this time. If you would like to ask a question, please click on the "raise hand" button, which can be found on the black bar at the bottom of your screen.

Chris Winfrey: Please accept, unmute your audio, and ask your question. As a reminder, we are allowing analysts to ask one question today. We will wait one moment to allow the queue to form. Our first question will come from Craig Moffett with Moffett Nathanson. Please unmute and ask your question. Craig, your line is now open. You're able to unmute on your side when you're ready. Good morning. Chris, I wonder if you could just sort of help us think about where broadband is getting better so that we can sort of get our minds around your arguments that things are going to improve on the broadband side. Is it in areas where you've completed your high splits? Can you share some data that suggests that your market share or market retention is improving? You talked about voluntary versus involuntary churn last quarter and your voluntary churn metrics being best ever.

And the churn benefit is pretty significant so no big secret that.

When it is your turn, you will receive a message on your screen from the host, allowing you to talk, and then you will hear your name called. Please accept, unmute your audio, and ask your question.

Bundling different products together saving customers money having them.

As a reminder, we are allowing analysts to ask 1. Question today we will wait 1 moment to allow the queue to form.

<unk> unified.

Unified service was seamless connectivity and seamless entertainment.

Does that from a churn perspective.

Our first question will come from Craig Moffat with Moffett Nathanson, please, unmute. And ask your question.

The challenge that we're facing right now isn't so much on the <unk> side, although I think there's real opportunity where that will just continue to get better.

Craig, your line is now open. You're able to unmute on your side when you're ready.

The challenge we have is the operating environment remains competitive with new competitors and the macro environment.

Sorry about that. Uh, good morning. Um,

Hasnt hasnt gotten better and I'll start from the top of the funnel, we have a really muted housing environment, they're slow household formation of negative rates.

Chris, I wonder if you could just, uh, sort of help us think about this.

Have continued mobile substitution growth and then you layer on top of that so you have these kind of macro trends you layer on top of that competitively theres more footprint expansion for cell phone and internet.

Particularly from AT&T.

Gripped some others have varying results on the residential fixed wireless access for cellphone interrupted at&t's new to the space with expanding coverage.

Um where Broadband is is getting better. Um, so that we can sort of get our, get our minds around, um, the the arguments that that things are going to improve on the Broadband side, um, is it in areas where you've completed your high splits, can you share some some, some data that suggests that um that your market share or or or Market retention is improving. You talked about

And then you take a look at our overlap with one gigabit or higher competition, it's grown the pace of that growth hasn't changed.

Chris Winfrey: I wonder if you could just sort of help us sort of frame why we should be optimistic about improving results. Sure. Just to tackle both of those quickly, I think it's probably best to give a more global look. The high split is going well, but we're not actively marketing the capabilities until we get further down the road from a national perspective, just to make sure that we're on track there. There's really nothing to report there. Where churn is definitely better is to the extent that we have a mobile relationship and to the extent we have more lines per mobile relationship, the impact is significant on the churn impact. In addition to that, which has always been the case in cable, to the extent you have a video relationship attached to that.

A voluntary versus involuntary churn last quarter and uh, and your voluntary churn metrics um being best ever.

Fiber overlap areas.

Our penetration of mature fiber overlap areas remains well above the competition, but it's new competition.

I wonder if you could just sort of help us sort of frame, um, why we should be optimistic about improving results.

In multiple fronts.

Sure. Um,

In any market, where you have new competition, whether it's fiber or cell phone internet theres going to be a short term impact on us.

And that's where we're seeing it right now is at the at the gross add level, we are seeing that in Q.

Q1, and Q2, our gross adds were actually higher year over year Q3 or is lower year over year.

The impact there was most pronounced in the low income segment, that's not an excuse I'm not sure if somebody is targeting it or not but it was pretty notable for us and it's.

That's still very much an important segment for us as well and so we're trying to pay attention to that.

So it's really it's really coming down to at this stage competition for new a limited number of gross adds that exist in the marketplace because some of the.

Chris Winfrey: Now what we're seeing is the additional activation of these direct-to-consumer apps, which are included as part of the offer. To the extent when that occurs and it's meaningful, the churn benefit is pretty significant. No big secret that. Bundling different products together, saving customers money, having them have a unified service with seamless connectivity and seamless entertainment really does that from a churn perspective. The challenge that we're facing right now isn't so much on the churn side, although I think there's real opportunity where that will just continue to get better. The challenge we have is the operating environment remains competitive with new competitors and a macro environment that hasn't gotten better. I'll start from the top of the funnel. We have a really muted housing environment. There's slow household formation and low move rates. We have continued mobile substitution growth.

Look just to tackle both of those quickly. And then I think it's probably, you know, investigative a more Global look. The you know, the high split is is going well, but we're not actively marketing uh the capabilities until we get further down the road from a national perspective just to make sure that we're on track there. So that there's there's really nothing to report. Their return is definitely better is to the extent that we have a mobile relationship. And to the extent, we have more lines per mobile relationship. The impact is, you know, significant on the churn impact. And then in addition to that, which has always been the case in cable to the extent. You have a video relationship attached to that but now

The.

The macro trends.

But having said all that.

If you think about you and I have spoken about it before if you take if you look at the bucket of gross adds in the bucket of disconnects as you know the difference between net losses and net adds as a sliver of gross adds or it's a sliver of disconnects.

And in this case I think over time, when you think about the forward outlook, whether its household formation.

What we're seeing is the additional activation of these direct to Consumer apps, which are included as part of the offer to the extent. And when that occurs and it's meaningful, um, and the churn benefit is, is pretty significant. So, you know, no big secret that, uh, it's bundling different products together. Saving customers money, having them have a unified service with seamless connectivity and seamless entertainment, you know, really does that from a term perspective.

Whether it's.

Mobile substitution steadying out whether it's slow move rates.

Whether it's.

Cell phone internet getting to its final stage of footprint, which she did was coming or the slowdown or.

The, the challenge that, you know, we're facing right now. Isn't so much on the turn side, although I think there's real opportunity where that'll just continue to get better. The, you know, the challenge we have, is the operating environment remains competitive with, you know, new competitors and macro environment that

A cessation of.

New fiber overbuild, all those things I think will happen just unclear.

You know, it hasn't gotten better, and I'll start from the top of the funnel. So we have a really muted housing environment with slow household formation and low move rates.

Very difficult to predict frankly, the timing of each one of those but I don't think it takes all of them. So it takes a couple of those one or a couple of those who need to have an outsized impact on our ability to grow.

Chris Winfrey: You layer on top of that, you have these kind of macro trends. You layer on top of that, competitively, there's more footprint expansion from cell phone internet, particularly from AT&T. There's no secret. Some others have varying results on the residential fixed wireless access or cell phone internet, but AT&T is new to the space with expanding coverage. You take a look at our overlap with 1 gigabit or higher competition. It's grown. The pace of that growth hasn't changed in our fiber overlap areas. Our penetration in mature fiber overlap areas remains well above the competition. It's new competition in multiple fronts. In any market, when you have new competition, whether it's fiber or cell phone internet, there's going to be a short-term impact on us. That's where we're seeing it right now, at the gross ad level.

In the meantime.

We're not standing still to hear it and there is a determination on our side and the marketing offer expressions better use of mobile and video.

We have continued mobile substitution growth and then you layer, on top of that. So you have these kind of macro Trends, you layer on top of that. Competitively, there's more footprint expansion from cell phone internet, particularly from AT&T's. There's no no secrets and others, have, you know, varying results on the residential fixed wireless access or cell phone internet, but AT&T's new to the space with expanding coverage.

But I think through our own efforts, both short term and long term as well as a couple of those external and macro variables changing it would make all the.

The difference in.

Internet customers again.

In the meantime, when we take a look is there a silver lining the silver lining is this environment.

Is it is pushing us to be a better operator, and I think we would come out the back end with macro or competitive slowdown.

Which will occur we'll end up being a better operator, with a better brand perception and probably a better cost structure, along the way as well.

Chris Winfrey: We are seeing in Q1 and Q2, our gross ads were actually higher year over year. Q3, it was lower year over year. The impact there was most pronounced in the low-income segment. That's not an excuse. I'm not sure if somebody's targeting it or not, but it was pretty notable for us. That's still very much an important segment for us as well. We're trying to pay attention to that. It's really coming down to, at this stage, competition for a limited number of gross ads that exist in the marketplace because of the macro trends. Having said all that, if you think about, Craig, you and I have spoken about it before, if you look at a bucket of gross ads and a bucket of disconnects, the difference between net loss and net ads is a sliver of gross ads or it's a sliver of disconnects.

Okay.

Thank you.

Um, and then you take a look at our overlap with 1 gigabit, uh, or higher competition. It's grown. The pace of that growth hasn't changed and you know, in our fiber overlap areas and, um, you know, our penetration and mature fiber overlap areas remains, well, above the competition, but it's new competition. Um, you know, in multiple fronts and, um, in any Market, when you have new competition, whether it's fiber or cellphone the internet, there's going to be a short term impact on us and, and that's where we're seeing it right now. Is that the at the gross? Add level. We are seeing, you know, and q1 and Q2 are gross ads were actually higher year-over-year Q3 of his lower year-over-year. You know the the impact that

Thanks, Greg Laila, we will take our next question. Please.

Your next question will come from Ben Swinburne with Morgan Stanley.

Good morning can you hear me okay, yes.

Yes.

Great Great two questions.

Was most pronounced in the low-income segments. That's not an excuse. I'm not sure if somebody's targeting it or not, but it was pretty notable for us. And it's, uh, that's still very much an important segment for us as well. And so we're trying to pay attention to that.

Jessica I think back in September you had suggested that the.

Fourth quarter EBITDA decline would be maybe less significant than the third quarter. You can correct me if I got that wrong.

ah, uh,

Ones like Youre signaling that it'll be bigger in Q4 than Q3 I'm. Just wondering if you could talk a little bit what's changed in the business.

a macro trends.

And if the layoffs are having a positive or negative maybe there is a charge and their impact in the fourth quarter and then Chris.

I hesitate to ask you about your competition there.

Chris Winfrey: In this case, I think over time, when you think about the forward outlook, whether it's household formation, whether it's. Mobile substitution steadying out, whether it's low move rates, whether it's cell phone internet getting to its final state of footprint, which is coming, or the slowdown or cessation of new fiber overbuild, all those things I think will happen. It's just unclear. It's very difficult to predict, frankly, the timing of each one of those. I don't think it takes all of them. It takes a couple of those, one or a couple of those, and you'd have an outsized impact on our ability to grow. In the meantime, we're not standing still. You can hear it. There's a determination on our side and marketing offer expressions, better use of mobile and video.

It's not you it's them but.

This has been an interesting week, Comcast announced that they're not planning on a rate increase normal course.

On broadband Verizon talked about the fact that it lean too much on price increases.

But you know, having said all that, um, if you think about Craig, you and I have spoken about it before the if you take, if you look at a bucket of gross ads and a bucket of disconnects, you know, the difference between, you know, net loss. And and and net adds is is a sliver of gross ads or it's a sliver of disconnects. And in this case, you know, I think, you know, over time when you think about the forward Outlook, whether it's household formation,

I know charter has always been going back to Tom's leadership more more cautious I guess for lack of better term on pricing, but I'm just wondering if when you hear that.

Do you think it does it change your outlook and do you have to think differently about your ability to grow broadband revenues convergence revenues just given what youre hearing from two two of the companies one of which is a major competitor.

In the marketplace. Thank you.

Yeah.

Got it and then on the EBIT side.

Whether it's uh, you know, mobile substitutions studying out whether it's low move rates, whether it's uh you know cell phone internet, getting to its you know final State a footprint, which you know is coming or the slow down or or sensation of new fiber overbuild. All those things I think will happen it's just unclear. It is very difficult to predict, frankly, you know, the timing of each 1 of those. But I don't think it takes all of them so it takes, you know, a couple of those 1 or a couple of those and you have an outsized impact on our ability to grow

As we often do we export some new offers inside of the third quarter and a few of those offers impacted are a bit more than we had anticipated without driving the additional sales that we expected.

Chris Winfrey: I think through our own efforts, both short-term and long-term, as well as a couple of those external and macro variables changing, it would make all the difference. We'll grow internet customers again. I think in the meantime, when we take a look, is there a silver lining? The silver lining is that this environment is pushing us to be a better operator. I think when we come out the back end with macro or competitive slowdown, which will occur, we'll end up being a better operator with a better brand perception and probably a better cost structure along the way as well. Thank you. Thanks, Craig. Leila, we'll take our next question, please. Your next question will come from Ben Swinburne with Morgan Stanley. Good morning. Can you hear me okay? Yep. Great. Two questions.

Pulling them from the market as of the beginning of November.

But theyre, putting a bit of pressure on our IP growth and <unk>, which combined with some sales channel mix pressure and marketing and resin sales.

In the meantime. Um, you know, we're not standing still you can hear it. There's a determination on our side and and uh marketing offer Expressions better use of mobile and video. Um but I think through our own efforts, both short term and long term as well as a couple of those external and macro variables changing. You know, it would make all the difference in, you know, we'll work. Cut internet customers again.

Well, we will put us in that place where.

You did hear it correctly that I that I think they were a little more pressured in Q4 than we had anticipated that we would be when I spoke about it if you said months ago.

Like in the meantime, you know, when we take a look, you know, is there a silver lining? The silver lining is this environment, you know, it is pushing us to be better operators. I think when we come out the back end with macro or competitive slowdown, um...

And then on on rate increase.

Because I'd take a step back.

Which will occur. You know, we'll end up being a better operator with a better brand perception and probably a better cost structure along the way as well.

Clearly we've seen to your point everything that's been said in the past week or so, but our <unk> today and our promotional pricing retail pricing when you take a look at the spectrum pricing and packaging that we rolled out last year.

Thank you, thanks. Thanks. Craig Leila, we'll take our next question, please.

Your next question will come from Ben swinburne with Morgan Stanley.

<unk> and our pricing is lower today versus our peers and competitor and.

Uh, good morning. Uh can you hear me okay?

Chris Winfrey: Jessica, I think back in September, you had suggested that the fourth-quarter EBITDA decline would be maybe less significant than the third quarter. You can correct me if I got that wrong. It sounds like you're signaling that it'll be bigger in Q4 than Q3. I'm just wondering if you could talk a little bit about what's changed in the business. If the layoffs are having a positive or negative, maybe there's a charge in their impact in the fourth quarter. Chris, I hesitate to ask you about your competition since it's not you, it's them. This has been an interesting week. Comcast announced that they're not planning a rate increase, normal course on broadband. Verizon talked about the fact that they had leaned too much on price increases.

We're we're you.

Because of that we've always had as you pointed out probably a little more headroom than others and given this macro environment, we're not in a position to not pass through cost increases.

Increases as they occur that's particularly the case with video and you know.

I wish that were different but that's the economic reality and I think you should expect us to do that and because of discipline in the past, we're we're probably at a different spot.

I would also.

So remember that based on because of the spectrum pricing and packaging that we rolled out last year and other.

Migration stuff, we've done before because of the transaction activity over the past year.

Chris Winfrey: I know Charter's always been, going back to Tom's leadership, more cautious, I guess, for lack of a better term, on pricing. I'm just wondering if when you hear that, does it change your outlook? Do you have to think differently about your ability to grow broadband revenues, convergence revenues, just given what you're hearing from two of the companies, one of which is a major competitor in the marketplace? Thank you. Got it. Ben, on the EBITDA side, as we often do, we explored some new offers inside of the third quarter, and a few of those offers impacted our ARPU a bit more than we had anticipated without driving the additional sales that we expected.

Yep. Yep, great great. Um, 2 questions, uh, Jessica. I think back in September, you had suggested uh that that the fourth quarter, I decline would be maybe less significant than the third quarter. You can correct me. If I got that wrong, it sounds like you're signaling. Uh, that it'll be bigger in Q4 than Q3. I'm just wondering. If you could talk a little bit, what's changed in the business and if the layoffs are having a a positive or negative, maybe there's a charge in there, uh, impact in the fourth quarter and then Chris, um, I hesitate to ask you about your competition since there. It's not you it's them. But um, yeah, this has been an interesting week. Comcast announced that they're not planning a a rate increase. Normal course, on broadband, Verizon talked about the fact that they lean too much on price increases

We've successfully migrated much of our base to spectrum pricing and packaging and you haven't seen in our results other than that.

I know Charter has always been, you know, going back to to Tom's leadership and more more, uh, cautious, I guess, for lack of a better term on on pricing. But I'm just wondering if, when you hear that.

The separate offer that Jessica mentioned, you haven't seen a big <unk> impact.

That migration to lower promotional and lower retail pricing over the past year, because we've managed it through putting more value into the package and that's that's the case and so that migration at a product level and our peers and visible externally that migration has occurred not just through acquisition, but as customers see these offers.

Do you think it does, it change your outlook and do you have to think differently about your ability to grow Broadband, revenues, convergence revenues, just given what you're hearing from 2, 2 of the companies 1 of which is a major competitor um, on in the marketplace. Thank you.

In the marketplace, there's a proactive.

Chris Winfrey: We're pulling them from the market as of the beginning of November, but they're putting a bit of pressure on our ARPU growth in Q4, which, combined with some sales channel mix pressure in marketing and resi sales, will put us in that place where you did hear it correctly, that I think they were a little more pressured in Q4 than we had anticipated that we would be when I spoke about it a few months ago. Ben, on rate increase, I take a step back. Clearly, we've seen, to your point, everything that's been said in the past week or so. Our ARPU today and our promotional pricing and retail pricing, when you take a look at the Spectrum pricing and packaging that we rolled out last year, our ARPU and our pricing is low today versus our peers and competitor.

Migration that day.

It also occurs through retention through loyalty offers that we've migrated or a big portion of our existing base over.

As well as you know reacted migrations I mentioned inside of retention and so.

Got it. So, we've been on the EBIT side. As we often do, we explored some new offers inside of the third quarter, and a few of those offers impacted our EBIT more than we had anticipated, without driving the additional sales that we expected. We're pulling them from the market as of the beginning of November. However, they're putting a bit of pressure on our food growth in Q4, which, combined with some sales channel mix pressure and marketing and residential sales, is affecting our performance.

So we've been able to manage our true.

And in a way that continues to create value for customers are lowering their overall product price, but keeping the household.

Um, we'll we'll put us in that place where um, you you did hear it correctly that. I that, I think they were a little more pressured in Q4 than we had anticipated that we would be what I spoke about it if you a few months ago.

Contribution to same particularly at a margin level. So.

To wrap it up I think we're at a slightly different situation.

I don't think that.

That's where we're at today because of what we've done over the past couple of years.

Makes sense. Thanks, so much yes, thanks, Ben Layla, we will take our next question. Please.

And then, uh, then on on great increase. Um, what kind of a take a step back? Um, clearly we've seen to your point everything that's been said in the past week or so, but our our food today and our promotional pricing and Retail pricing. We need to take a look at the Spectrum pricing and packaging that we rolled out last year. You know, our our

Chris Winfrey: Because of that, we've always had, as you pointed out, probably a little more headroom than others. Given this macro environment, we're not in a position to not pass through cost increases as they occur. That's particularly the case with video. I wish that were different, but that's the economic reality, and I think you should expect us to do that. Because of discipline in the past, we're probably in a different spot. I would also say remember that based on, because of the Spectrum pricing packaging that we rolled out last year and other migrations that we've done before, because of the transaction activity over the past year, we've successfully migrated much of our base to Spectrum pricing and packaging.

Your next question will come from the cost <unk> with New Street research.

Who, and our pricing is low today versus our peers in competitor and, um,

Hi can you hear me okay.

Yes.

Alright, thanks, so much for taking the question.

Chris.

Place the female play here, where you split the split.

On how you marketed your products historically, so if your video event earlier. This month, you talked about potentially marketing video customers, where they pay for streaming services and ethylene everyday appropriate.

Similarly, there was the promotion recently.

Customers will see broadband for nearly free when they buy four lines of mobile is this the next step in the evolution and the marketing team.

Yes, I think these are just different marketing offer expressions to get to higher <unk> and higher margin per household at the same time saving customers lots of money so trying to create win win scenarios.

Chris Winfrey: You haven't seen in our results, other than this separate offer that Jessica mentioned, you haven't seen a big ARPU impact of that migration to lower promotional and lower retail pricing over the past year because we've managed it through putting more value into the package. That's the case, and so that migration at a product level and ARPU has been invisible externally. That migration has occurred not just through acquisition, but as customers see these offers in the marketplace, there's a proactive migration that they initiate that also occurs through retention and through loyalty offers that we've migrated a big portion of our existing base over. As well as reactive migrations, I mentioned, inside of retention.

Um, I would also, you know, say, you know, remember that based on because of the spike in pricing packaging that we've rolled out last year and and other migrations that we've done before because of the transaction activity over the past year. Um we've successfully migrated much of our base to Spectrum pricing and packaging and you haven't seen in our results. Other than the

Our national pricing and packaging Hasnt changed and I think that's the vast majority of how we go to market. The video expression really it's just the way we talk about it. So if you think about it for I'm going to make this up but an audience of over 35 years old or an audience of over 35 years old at Nee resonate Here's your video package, it's around $100.

And you get over a $125 of apps included for free.

But for an audience that's younger that may not be that interested all anybody or video the expression.

How about I'll give you a 125 plus dollars of app value for $100 and Oh by the way Youre linear video is included.

It's the exact same product so there's no change in economics, there for us, but depending on the audience either way, we're saving lots of lots of money and it's valuable to them interest expressed in a different way and then you overlay zuma or the ability to have unified search and discovery.

Chris Winfrey: We've been able to manage ARPU in a way that continues to create value for customers, so lowering their overall product price, but keeping the household contribution the same, particularly at a margin level. To wrap it up, I think we're in a slightly different situation. I don't think that that's where we're at today because of what we've done over the past couple of years. Makes sense. Thanks so much. Yep. Thanks, Ben. Leila, we'll take our next question, please. Your next question will come from Vikas Harloka with New Street Research. Hi. Can you hear me okay? Yes. Hi. Thanks so much for taking the question. Chris, it seems like there's a theme at play here where you flip the script on how you've marketed your products historically.

The, you know, the separate, you know, offer that Jessica mentioned, you haven't seen a big art, poo impact of that migration to lower Promotional and lower. Retail pricing over the past year, because we've managed it through, putting more value into the package. And that's, that's the case. And so that migration at a product level, an arc has been invisible. Externally that migration is occurred not just through our acquisition, but as customers see, these offers in the marketplace, there's a proactive migration that they initiate that also occurs through retention and through loyalty offers that we've migrated a, a big portion of our existing base over, um, as, as well as you know, uh, reactive migrations I mentioned inside of retention, and so

Interesting.

And compelling way to use video to drive our connectivity services.

Your line offer.

One I would start by saying, that's let's say, let's say relatively small audience, that's going to convert over four lines in one single fell swoop, but it is a it is a good way to express value to consumers by saying if you take four lines.

Thank you, Sensei. Thanks so much. Yep. Thanks, Ben. Leila, we'll take our next question, please.

We'll give you internet for free.

Your next question will come from vicos, harlea with new Street research.

And when.

When you do the math and think about the economics here I'm sure Jessica can chime in but the vast majority of these customers take speed upgrades.

Hi, can you hear me, okay?

Yes.

Hi, thanks so much for taking the question. So,

And we'll look at a plus.

Our <unk> selling in over time in our margin over time is higher than any other traditional sale and so you can move dollars around that's the benefit of having.

Chris Winfrey: At your video event earlier this month, you talked about potentially marketing video to customers where they pay for streaming services and get a linear video for free. Similarly, there was a promotion recently where customers receive broadband for nearly free when they buy four lines of mobile. Is this the next sort of step in the evolution in the marketing chain? Yeah. I think these are just different marketing offer expressions to get to higher ARPU and higher margin per household at the same time, saving customers lots of money. Trying to create win-win scenarios. Our national pricing and packaging hasn't changed. I think that's the vast majority of how we go to market. The video expression really is just the way we talk about it.

Multiple products to sell and creating offer expressions that grid is really winning situations for different pockets of audience in the marketplace and you don't have to sacrifice revenue or margin from a company perspective in order to achieve that again, that's a a twist and offer expression for a relatively slow.

Chris, it seems like there's a team at play here where you flip the script on how you marketed your products historically. So at your video event, early this month, you talked about potentially marketing video to customers where they pay for streaming services and get a linear video for free.

Um, similarly, there was a promotion recently where customers receive broadband for nearly $3 when they buy 4 lines of mobile. Is this the next sort of step in the evolution in the marketing chain?

So youre not going to see a lot of volume there, but to the extent it exist it's incremental to what you would have gotten otherwise.

It's accretive relative to the average acquisition.

In particular, the 19, because those customers with foreign lines of mobile and Internet line.

Their churn rates are very low and say you can end up with very high customer lifetime value is particularly given the combination of the fly lines and the upgraded services that people think yes, even with that you're totally right, but even without that it's a slam dunk. It's got makes it with Jessica said is true we get four lines.

Chris Winfrey: If you think about it for, I'm going to make this up, but an audience over 35 years old, for an audience over 35 years old, it may resonate that here's your video package. It's around $100, and you get over $125 of apps included for free. For an audience that's younger that may not be that interested at all in linear video, the expression, "How about I give you $125 plus of app value for $100? And oh, by the way, your linear video is included." That's the exact same product. There's no change in economics there for us. Depending on the audience, either way, we're saving them lots of money. It's valuable to them. It's just expressed in a different way. You overlay Zumo and the ability to have unified search and discovery. It's an interesting and compelling way to use video to drive our connectivity services.

And our free Internet and upgraded for an extra $10 or $20 to 500 advisers. So their gig plus of unlimited plus lives the value in that package.

Yeah, I think these are just different marketing, you know, offer Expressions to get to hire our poo and higher margin for household at the same time. Saving customers lots of money. So, you know, trying to create win-win scenarios. Um, our national pricing and packaging hasn't changed. And I think that's the, the vast majority of how we go to market. The video expression really is just the way we talk about it. So if you think about it, for, I'm going to make this up but an audience over 35 years old or an audience over 35 years old, that may resonate that here's your video package, it's, you know, around a hundred dollars and you get over 125 dollars of apps included for free. But for an audience that's younger that may not be that interested at all in line with your video, the expression. Um,

It's high for both is higher than the customer can get anywhere else in the marketplace.

It is higher for us and doesn't.

Isn't that a high value, yeah, and because of that the relationship sticks as low churn has high customer lifetime value for both.

Got it thanks, so much.

Thanks for cash Layla, we will take our next question. Please.

Your next question will come from Jessica Reif Ehrlich with Bank of America.

Chris Winfrey: The four-line offer, one, I would start by saying that's a relatively small audience that's willing to convert over four lines in one single fell swoop. It is a good way to express value to consumers by saying, "If you take four lines, we'll give you internet for free." When you do the math and think about the economics here, I'm sure Jessica can chime in, but the vast majority of these customers take speed upgrades. They're taking unlimited plus. Our ARPU at selling over time and our margin over time is higher than any other traditional sale. You can move dollars around. That's the benefit of having multiple products to sell and creating offer expressions that create a really winning situation for different pockets of audience in the marketplace. You don't have to sacrifice revenue or margin from a company perspective in order to achieve that.

Thank you. Thank you.

Two different things one can you just give us an update on what color on Cox acquisition, how you're preparing for it.

At any time.

You know how about I give you a 125 plus dollars of app value for $100? And oh, by the way, your linear videos included. Well, that's the exact same product. So there's no change in economics there for us. But depending on the audience versus either way, we're saving them. Lots of lots of money and it's valuable to them. It's just expressed in a different way. And then you overlay Zumo, and the ability to have unified search and Discovery. And so it's an interesting and compelling way to use video to drive our connectivity Services, the 4-line offer. Um you know 1 I would start by saying that's that's a it's a relatively small audience that's willing to to to convert over 4 lines in 1 single Fell Swoop. But it is a it is a good way to express.

Timing as well and then.

On the video products, you've had such dramatic improvement pretty quickly.

Value to Consumers by saying if you take 4 lines, you know, we'll give you internet for free.

Since you started marketing it in October.

Can you give us any detail or color on that in terms of.

Conversion of broadband only subs, what you're seeing in terms of retention.

And um, when you do the math and think about the economics here, you know, I'm sure Jessica can chime in. But, you know, the vast majority of these customers take speed upgrades

How many subs are really engaging with us I mean, obviously, it's worth it.

Yes.

Im sorry, and Cox, there's no real new news there the from a.

Timeline perspective, everything we said in the past, which was saying I don't want to step on my my foot in my own feed here and say it differently, but I think it was mid next year is what we have said and so that's still the case.

Our focus right now from a Cogs perspective, there's a few fold, but first and foremost is to work with the regulators at the federal and state level make sure that we're in a position to answer all their questions properly.

Chris Winfrey: Again, that's a twist and offer expression for a relatively small audience. You're not going to see a lot of volume there, but to the extent it exists, it's incremental to what you would have gotten otherwise. It's a great if relative to the average acquisition, particularly too because those customers with four lines of mobile and an internet line, their churn rates are very low. You can end up with very high customer lifetime values, particularly given the combination of the four lines and the upgraded services that people take. You're totally right. Even without that, it's a slam dunk. That makes it what Jessica said is true. If we get four lines and a free internet with an upgraded for an extra $10 or $20 to 500 megs or to a gig plus unlimited plus lines to value in that package, it's high for both.

Make sure they understand the value that exists here for.

For our customers in particular, because we have lower pricing or the ability for these type of mobile offers and video at scale and to saving money across really the entire suite of products as well as for employees.

incremental to what you would have gotten otherwise, and it's a degree of relative to, you know, the average acquisition.

<unk>, we serve including adopting some of the great things that Cox does inside of their local communities and create a benefit for not just our cost footprint, but also inside our existing footprint as well. So that's the biggest focus but also clearly as we tried to make sure we're preparing ourselves to as quickly as possible post closing to put ours.

<unk> is in a position to launch the spectrum brand and Cox mortgage to launch our pricing and packaging to put the CMO in place for a video acquisition and to apply our seamless entertainment and seamless connectivity products you know theres a lot of work in preparation for us to do that we can't do anything in the meantime, until we close or we can do a lot of thinking which is a lot of preparation.

Chris Winfrey: It's higher than the customer can get anywhere else in the marketplace. It's higher for us than a high value-add. Because of that, the relationship sticks, has low churn, has high customer lifetime value for both. Got it. Thanks so much. Thanks, Vikash. Leila, we'll take our next question, please. Your next question will come from Jessica Wright Ehrlich with Bank of America. Thank you. I guess two different things. One, can you just give us an update on or color on Cox acquisition, how you're preparing for it. Just the timing as well. On the video product, you've had such dramatic improvement pretty quickly since you started marketing it in October. Can you give any detail or color on that in terms of conversion of broadband-only subs, what you're seeing in terms of retention, how many subs are really engaging with this? I mean, obviously, it's working. Yes.

Particularly too, because those customers with 4 lines of mobile and an internet line. Don't their turn rates are very low. Correct? And so you, you can end up with very high customer lifetime values, particularly given the combination of, of the 4 lines and and the upgraded services, that people think, yeah. Even with with your totally right. And, but even without that, it's a dunk but that makes it. What Jessica said Is is true. If we get 4 lines in a free internet with an upgraded, for an extra ten dollars or twenty dollars to 500 Megs or to a gig plus an unlimited plus lines, the value in that package, you know, it's high for both. It's it's higher than the customer can get anywhere else in the marketplace and it's higher for us than, uh,

Than a high value. Yeah. And because of that, the relationship sticks, has low churn, and has high customer lifetime value for both.

I'm trying to get ready for that and so the team's busy on that front as well.

Got it. Thanks so much.

Thanks for cash, Layla, we'll take our next question, please.

On video.

You know.

It's going to sound like Apple pie, but sales are up churn is down on video.

Your next question will come from Jessica rev Erik with Bank of America.

Relative to prior periods and.

The activation of the apps has really accelerated.

It had been growing pretty steadily but that was absent us really doing anything to advertiser drive it because we wanted to make sure that the service experience for activation and they're in a unified way that upgrades could work the way that it should.

Cost to the customer.

And so had gotten pretty significant and then clearly we had the launch of the new ESPN App.

Uh, thank you, thank you. Um, I guess 2 different things 1. Can you just give us an update on what color on Cox acquisition, how you're preparing for it. Um and any you know, just a timing as well. And then um on the on the video products you've had such dramatic Improvement, pretty quickly. You just since you started marketing it in October, um, can you give it any detail of color on that in terms of um conversion of broad? There's only Subs what you're seeing in terms of retention. You know, how many, how many Subs are really engaging with this? I mean, obviously, it's worth it.

Fox one as well as Hulu now included for free and then just in the past few weeks the launch of the spectrum.

Yes.

Chris Winfrey: On Cox, there's no real new news there. From a timeline perspective, everything we've said in the past remains the same. I don't want to step on my own feet here and say it differently, but I think it was mid-next year is what we had said, and that's still the case. Our focus right now, from a Cox perspective, is a few-fold.

Um, sorry, Cox, there's no real new news there. The, you know,

And digital marketplace there was a.

Sort of accelerated pickup.

Even in the even in the recent weeks.

from a timeline perspective everything we've said in the past Remains the Same, um, I don't want to step on my foot, you know my foot my own feet here and

The benefit from that is what we can clearly see now is.

Chris Winfrey: First and foremost is to work with the regulators at the federal and state level, make sure that we're in a position to answer all their questions properly, make sure they understand the value that exists here for customers in particular, because we have lower pricing and the ability to bring these types of mobile offers and video at scale and to save them money across really the entire suite of products, as well as for employees and the communities we serve, including adopting some of the great things that Cox does inside of their local communities and create a benefit for not just the Cox footprint, but also inside our existing footprint as well. That's the biggest focus.

When you segment customers based on their tenure with the company.

The number of Activations of these direct to consumer apps that they have.

Whether that customer zero to six months 10 year six to 12 12 to $24 24 and beyond it.

And each of that a b testing of whether they activated the ops or not and how many apps do they activate Detroit reduction is significant there's clearly a lot of self healing processes. That's inside there those that activate tend to like us more.

Say it differently, but I think it was mid next year is what we said, and so that's still the case. Um, our Focus right now from the Cox perspective is a few folds. But first and foremost is to work with The Regulators at the federal and state level, make sure that we're in a position to answer all the questions properly. Um, make sure they understand the value that exists here for um, for customers in particular because we have lower pricing and the ability to bring, you know, these type of mobile offers and video at scale and to save the money across from the entire Suite of products, as well as for employees. And uh, the communities, we serve including adopting some of the great things that Co

But how are you.

But it's pretty compelling it. So we're excited about what we're seeing on that front. It's been a lot of work it's not perfect. Yet. So when you think about the different ways that customers activate each one of those programmers genuinely has different activation pass and flow that we need to follow so we still think we can work on that with things like.

Chris Winfrey: Also, clearly, as we try to make sure we're preparing ourselves as quickly as possible post-closing to put ourselves in a position to launch the Spectrum brand in Cox markets, to launch our pricing and packaging, to put Zumo in place for video acquisition, and to apply our seamless entertainment and seamless connectivity products. There's a lot of work in preparation for us to do that. We can't do anything in the meantime until we close, but we can do a lot of thinking. We do a lot of preparation and trying to get ready for that, and the team is busy on that front as well. On video, it's going to sound like apple pie, but our sales are up, churn is down on video relative to prior periods. The activation of the apps has really accelerated.

Behind the voting.

<unk> authentication.

Still get password and credentials to the programmers the way that they want so there's there's still things that we can do to make it even better.

<unk> done but.

Pretty pleased with where it's at and I've said it in the prepared remarks, I just want to be clear our goal here.

You know it isn't to have positive video ads and it's not you know unfortunately, it is not to shape. The video ecosystem, because it's pretty challenged but our goal is to make sure that we have a unique and differentiated product that we can put in front of FERC connectivity customers in a way that generates new ways to market and acquire customers and has retentive value in.

Inside of their local communities and create a benefit for. Not just the Cox footprint but also inside our existing footprint as well. So that's the you know, the biggest Focus but also clearly as we try to make sure we're preparing ourselves to as quickly as possible post-closing, to put ourselves in a position to launch the Spectrum brand and Cox markets to launch our pricing, and packaging to put the Zumo in in place, for video acquisition and to apply our seamless entertainment and seamless connectivity products. You know, there's a lot of work in preparation for us to do that. We can't do anything in the meantime until we close or we can do a lot of thinking. We do a lot of preparation and trying to get ready for that. And so even if the team's busy on that front as well,

On video. Um,

Chris Winfrey: It had been growing pretty steadily, but that was absent us really doing anything to advertise or drive it because we wanted to make sure that the service experience for activation was there in a unified way and that upgrades could work the way that it should with the incremental cost to the customer. It had gotten pretty significant. Clearly, we had the launch of the new ESPN app, Fox One, as well as Hulu now included for free. In the past few weeks, the launch of the Spectrum app and digital marketplace led to an accelerated pickup, even in the recent weeks. The benefit from that is what we can clearly see now.

It has value and utility for them then to the extent of broadband customer wants that in the guidance that we're going to attach that to their relationship in this adult we will.

And.

And we'll just rely on the retentive value of Internet mobile and convergence on that front, so it's going well, but it's still very early days.

And the amount of pick up on on the diesel inclusion offers us significant that's great for the programmers because once that happens.

They will have relative to standalone selling of these retail products that are going to have much lower churn.

You know, it's going to sound like you know, apple pie, but our sales are up, turn is down on video uh relative to Prior periods and um the activation of the apps has really accelerated. It had been growing, pretty steadily but that was absent us really doing anything to advertise or drive it because we wanted to make sure that the service experience for Activation and it was there in a unified way that upgrades could work the way that it should with the incremental cost to the customer. And um, so I'd gotten pretty significant and then when clearly we had the launch of, you know, the new ESPN app, uh, Fox 1 as well as Hulu, now included for free, and then just in the past few weeks. But

Obviously net of operating cost in wholesale relationship with great economics that exist inside the traditional linear system and.

Launch of the spectrum. Uh, app and digital Marketplace. There was a, there's an accelerated pickup um

And then they have the upgrade potential of these apps to an AD free version and we'll keep innovating in different ways wherever the customer wants to go with us for a restaurant and meeting together with the.

Chris Winfrey: When you segment customers based on their tenure with the company, the number of activations of these direct-to-consumer apps that they have, whether that customer is 0 to 6 months, 10 years, 6 to 12, 12 to 24, 24 and beyond, in each of that A/B testing of whether they activated the apps or not and how many apps they activated, the churn reduction is significant. There's clearly a lot of self-fulfilling prophecy that's inside there. Those that activate tend to like us more, I would argue. It's pretty compelling, and we're excited about what we're seeing on that front. It's been a lot of work. It's not perfect yet. When you think about the different ways that customers activate, each one of those programmers genuinely has a different activation path and flow that we need to follow.

even in the even in the the recent weeks, um, the benefit from, that is what we can clearly see now,

But I think it's a very very different relationships that we have now with the programmers and even the weeks understanding the importance of the.

is when you segment customers, based on their tenure with the company, the number of activations of these uh direct to Consumer apps that they have

Doing from packaging and from utility inside sooner with the ability to have clarified search and discovery across all these absolutely totally solved.

Where's the cable problem.

Is the one thing that I would add to that one.

Activate tends to like us more.

It's not the focus of it.

Investing in that.

There has been significant financial pressure on video margin.

With the loss of customers that we've seen over the last several years in bringing stability to that space.

Even if even if it's not that you're insulated stomach I'm, saying, if we can bring the pace of that down that.

Chris Winfrey: We still think we can work on that with things like behind-the-modem automatic authentication and still get password and credentials to the programmers the way that they want. There are still things that we can do to make it even better. We're not done, but pretty pleased with where it's at. I said it in the prepared remarks. I just want to be clear. Our goal here isn't to have positive video ads, and unfortunately, it's not to save the video ecosystem because it's pretty challenged. Our goal is to make sure that we have a unique and differentiated product that we can put in front of our connectivity customers in a way that generates new ways to market and acquire customers and has retentive value, and it has value and utility for them.

That really allows us to be in a better place to highlight the growth that we see across other areas of the business and to drive financial growth of the company as a whole by having more stability and so it's actually an important derivative growth ever.

Thank you.

Thanks, Jessica Laila, we will take our next question. Please.

Your next question will come from Michael Rollins with Citi.

Hi, Thanks, and good morning, two topics if I could.

First through all the recent efforts to improve efficiency at a lower cost can you size the future opportunity for savings, including if you have any.

But are you um but it's pretty compelling and so we're excited about what we're seeing on that front. It's been a lot of work, it's not perfect yet. Uh so when you think about the different ways that customers activate each 1 of those programmers, genuinely has a different activation path and flow that we need to follow. So we still think we can work on that with things like um you know, behind the modem automatic authentication uh and still get password and credentials to the programmers, the way that they want. So there's there's still things that we can do to make it even better, we're not done. But, um, pretty pleased with where it's at and I said it in the prepared remarks, I just want to be clear our, our goal here. It, you know, it isn't to have positive video ads and it's not, you know, unfortunately, it's not to save the video ecosystem because it's pretty challenged. But our goal is to make sure that we have a unique and differentiated product that we can put in front of our connectivity customers in a way that generates, you know, new ways to Market and acquire customers. And

Chris Winfrey: To the extent a broadband customer wants that and values that, we're going to attach that to the relationship. If they don't, we won't. We'll just rely on the retentive value of internet and mobile convergence on that front. It's going well, but it's still very early days. The amount of pickup on these inclusion offers is significant, and it's great for the programmers because once that happens, they will have, relative to standalone selling of these retail products, much lower churn. There's obviously no operating cost in the wholesale relationship. It's great economics that exist inside the traditional linear system. They have the upgrade potential of these apps to an ad-free version. We'll keep innovating in different ways wherever the customer wants to go.

Function opportunities to take cost out whether it's migrating customers to IP video off the linear infrastructure, where do your automation tools that you're bringing to your customers and employees.

And then secondly, and I guess forgive me expression, but are there any non linear ways to expand charters addressable market for revenue to introduce new ways to monetize the customer relationship to both the consumer and business segments. Thanks.

Has a retentive value and it has value in utility for them and to the extent of Broadband customer wants that and and values that we're going to attach that to the relationship and if they don't we won't. And um and we'll just rely on the retained value of Internet and mobile conversions, you know, on that front.

So it's it's going well but it's still very early days and um and the amount of pickup on on the these inclusion offers is significant, that's great for the programmers because, you know, once that happens.

Look great questions actually and subsequent both of which were thinking a lot about.

The size of the cost opportunity I've mentioned it in the remarks today.

We've been getting.

Depending on the year.

If you look at multi year period, a reduction of cost to serve for customer relationship through quality transactions, which actually came about by investing wars, we invested more in our employees and our systems and tools in order to drive down service transactions have lowered churn and all of that ultimately reduced our cost to serve over time for <unk>.

Chris Winfrey: That's where we're going to try to meet them together with what I think is a very different relationship that we have now with the programmers and even the leagues, understanding the importance of doing from packaging and from utility inside Zumo with the ability to have unified search and discovery across all these apps and really solve what I call, "Where's the game problem?" The one thing that I would add to that, while it's not sort of the focus of investing in the video product, there has been significant financial pressure on video margin with the loss of customers that we've seen over the last several years and bringing stability to that space.

They will have relative to Standalone selling. If these retail products, they're going to have much lower churn. There's you know obviously an operating cost and wholesale relationship is great economics that exists inside the traditional linear system and um and then they have the upgrade potential of these apps to an ad-free version and you know we'll keep innovating in different ways wherever the customer wants to go. That's that's where we're going to try to meet them together with the, with what I think is a very, very different relationship that we have now with the programmers. And and even the leagues, understanding that the importance of

Customer despite the higher investments.

And more recently in the past I'd say two years, making those tools better the investments that we had there has been driven by machine learning, which has migrated into AI type investments.

the doing from packaging and from utility inside zugo with the ability to have unified search and Discovery across all these apps and really solve the, you know what I what I call where's the game problem

Back of the backbone of all of that is a unified data and software development structure that we have here at charter, which you may or may not be unique.

Chris Winfrey: Even if it's not that you fully stop it from shrinking, if we can bring the pace of that down, that really allows us to be in a better place to highlight the growth that we see across other areas of the business and to drive financial growth of the company as a whole by having more stability in video. Yeah. It's actually important to rip it up for growth, I agree. Thank you. Thanks, Jessica. Leila, we'll take our next question, please. Your next question will come from Michael Rollins with Citi. Hi, thanks, and good morning. Two topics, if I could.

But it allows us to put these separate AI tools, because theyre really functioning off the same data spine and development infrastructure. It actually sets us up very well for <unk> and I'll be honest you know just a few months ago I kind of roll my eyes.

Is the 1 thing that I would add to that. Um, while it's not the focus of of the investing in the video product. Uh there has been significant financial pressure on video margin um with the loss of customers that we've seen over the last several years and bringing stability to that space. Uh even if even if it's not that that you that you fully, stop it from shrinking. If, if we can bring the pace of that down, um that really allows us to be in a better place to highlight the growth that we see across other areas of the business.

But when you take a look at the things that I mentioned that have really changed at least from our perspective, what we've been able to see whether it's <unk>.

And to drive financial growth of the company as a whole by having more stability and video. Yeah. So it's actually important to ramp up growth every.

Thank you, thanks. Jessica, Leila, we'll take our next question, please.

Short and long term memory multi modal the ability for our agent to potentially be in Atlantic AI agents able to interact with the customers agent over time.

Your next question will come from Michael Rollins with City.

Chris Winfrey: First, through all the recent efforts to improve efficiency at a lower cost, can you size the future opportunity for savings, including if you have any step function opportunities to take costs out, whether it's migrating customers to IP video off the linear infrastructure or the automation tools that you're bringing to your customers and employees? Secondly, and I guess forgive the expression, but are there any non-linear ways to expand Charter's addressable market for revenue to introduce new ways to monetize the customer relationship for both the consumer and business segments? Thanks. Yeah. Great questions, actually, and both of which we're thinking a lot about. The size of the cost opportunity, I mentioned it in the remarks today.

There's a real opportunity here for doing first and foremost the improvement of quality of customer service.

Based on the knowledge of the significant number of transactions, we used to every year theres not millions of different ways to do that transaction in best ways. There's there's usually one.

So the opportunity to meet the customer where they want at the end of the digital transaction is big I mentioned inside the prepared remarks, just the size of the cost of service for US as you know $8 million a lot of us physical but a lot of puts different areas of the business and what that will do so.

Those investments it actually first first is can you improve the customer service quality second is can you improve the quality of the job for an agent and when you do those things.

Hi, thanks, and good morning. Two topics, if I could. So, you know, first of all, the recent efforts to improve efficiency at a lower cost—can you size the future opportunity for savings? Including if you have any step-function opportunities to take cost out, whether it's migrating customers to IP video off the linear infrastructure or the automation tools that you're bringing to your customers and employees. And then, secondly, and I guess, forgive the expression, but are there any non-linear ways to expand Charter's addressable market for revenue to introduce new ways to monetize the customer relationship for both the consumer and business segments? Thanks,

Yeah, and look.

You make it better for the customer, but the agents more satisfied too which means that you have happier employees.

Chris Winfrey: We've been getting, depending on the year, but if you look at a multi-year period, a reduction in cost to serve for customer relationship through quality transactions, which actually came about by investing more. We invested more in our employees and our systems and tools in order to drive down service transactions and have lower churn. All of that ultimately reduced our cost to serve over time per customer despite the higher investments. More recently, in the past, I'd say two years, making those tools better, the investments that we've had there have been driven by machine learning, which has migrated into AI-type investments. The backbone of all of that is a unified data and software development structure that we have here at Charter, which may or may not be unique.

Who develops more tenure with the company, which is actually better for the customer you get this virtuous cycle agenda. The backend you can dramatically lower your cost and environments that have naturally higher attrition to begin with and so.

Great questions actually and something both of, which were thinking a lot about, um, you know, the size of the cost opportunity. I'd mentioned it in the remarks today. We've been getting um, you know, it depending on the year. Uh, but if you look at multi-year period, a reduction in cost to serve for customer relationship through quality transactions which actually came about by investing more. So we invested more in our employees.

I think the size of that.

The total of it today you can see it in our P&L, it's $8 billion and so I think there's you know without Covid, we don't know yet the exact size, but I think it can be significant and we're leaning into that pretty heavily.

The non linear ways, we've been a growing revenue and developing new products for the past few quarters. We've included a slide in slide four we can take a look but whether that's right or not there's a slide in there that shows the extent of our assets.

And our systems and tools in order to drive down service transactions and have lower churn and all of that ultimately reduced our cost to serve over time per customer despite the higher Investments and more recently in the past I'd say 2 years making those tools better the Investments that we've had there has been uh driven by Machine learning and and which is migrated into AI type Investments.

Part of that slide is meant to demonstrate that we have.

Chris Winfrey: It allows us to put these separate AI tools because they're really functioning off the same data spine and development infrastructure. It actually sets us up very well for agentic AI. I'll be honest, just a few months ago, I kind of rolled my eyes. When you take a look at the things that I mentioned that have really changed, at least from our perspective, what we've been able to see, whether it's short and long-term memory, multimodal, the ability for our agent to potentially, meaning an agentic AI agent able to interact with the customer's agent over time, there's a real opportunity here for doing, first and foremost, the improvement of quality of customer service. Based on the knowledge of the significant number of transactions we do every year, there's not millions of different ways to do that transaction, best ways. There's usually one.

Facilities.

We have connectivity capabilities.

That I think are genuinely of interest too.

Much broader.

Array of <unk> partners.

And it could also create additional residential products for us over time, but I mentioned that we have recently signed up with Amazon to do data offloading. It saves them money it has better connectivity.

Allows us to put these separate AI tools because they're, you know, really functioning off the same data spine and development infrastructure. It actually sets us up very well for agentic AI. And I'll be honest, you know, just a few months ago, I kind of rolled my eyes

We've done the same thing with XR, which youll find at different car ride share services as video cameras. So for offload, but you can think about what can we bring to the community in terms of Offloading the amount of bandwidth that comes into a garage every single night.

But when you take a look at the things that I mentioned, that have really changed at least from our perspective, what we've been able to see whether it's, you know, short and long-term memory multimodal, the ability for, you know, our agent to potentially, you know, meaning in agentic AI agents able to interact with the customer's agent over time. There's a real opportunity here for, for doing first and foremost, the Improvement of quality

And.

And save those providers money, which actually ends up saving customers money you can think about our location based services you know behind the modem or with our seamless connectivity abroad in terms of financial transactions and managing cyber security risk and a low latency environment in ways that you could mom.

Chris Winfrey: The opportunity to meet the customer where they want to be in a digital transaction is big. I mentioned inside the prepared remarks just the size of the cost of service for us is $8 billion. A lot of that's physical, but a lot of it's different areas of the business. What that will do, if we make those investments, it actually first is, can you improve the customer service quality? Second is, can you improve the quality of the job for an agent? When you do those things, you make it better for the customer, but the agent's more satisfied too, which means that you have a happier employee who develops more tenure with the company, which is actually better for the customer. You get this virtuous cycle. Agenda, the back end, you can dramatically lower your cost in environments that have naturally higher attrition to begin with.

Customer service based on the knowledge of the significant number of transactions. We need to do every year. There's not, you know millions of different ways to do that transaction. Best ways. There's there's there's usually 1

Notice that.

<unk> facilitates transactions for a beta V provider, but also makes the network safer for financial fraud for our end user customers in a way that can be relatively unique.

So the opportunity to meet the customer where they want to be in a digital transaction is big, I mentioned inside the prepared remarks, just to size it, the cost of the service for us is you know, 8 billion dollars a lot of that's physical. But a lot of that's, you know, different areas of the business and and what that will do

So and then move on it you'll see on that page there's a thousand.

Hudson localized data centers. These are not hyperscale data centers are generally much smaller they have a little bit less a lot less power.

If we make those Investments, it actually first, you know, first is, can you improve the customer service quality second is, can you improve the quality of the job for an agent? And when you do those things, um, you make it better for the customer, but the agents more satisfied too, which means that you have a happier employee Who develops more tenure with the company which is actually better for the company.

And we're exploring different use cases for what you can do there with it with respect to edge CDN put AI inferencing will be there I think there's a huge set of assets that exist in our footprint that are untapped as it relates to new <unk> products. There's nothing here that I can sit here at place material.

Chris Winfrey: I think that the size of that, the total of it today, you can see it in our P&Ls, $8 billion. I think there's, without giving, we don't know yet the exact size, but I think it could be significant, and we're leaning into that pretty heavily. The non-linear ways we've been of growing revenue, developing new products. For the past few quarters, we've included a slide. I don't know if it's slide four. We can take a look, but whether that's right or not, there's a slide in there that shows the extent of our assets. Part of that slide is meant to demonstrate that we have facilities and we have connectivity capabilities that I think are genuinely of interest to a much broader array of B2B partners and could also create additional even residential products for us over time.

Possibly, you get this virtuous cycle which ends up, you know, the back end you can dramatically lower your cost in environments that, you know, have naturally higher attrition to begin with. And so I think that the size of that, you know,

Hey.

We're pretty active in talking to different people across the country and in fact globally about different ways that we can make better use of these assets to bring value to consumers and bring new revenue streams to us. So that's some sense that's the history of cable.

The total of it today, you can see it in our P&Ls, you know, $8 billion. And so I think there's, you know, without getting—we don't know yet the exact size—but I think it could be significant, and we're leaning into that pretty heavily.

You step back you know broadband was never a product.

So for IP telephony was never a product mobile was never a product and they all came on the backbone of these assets that we have in providing connectivity services.

The um, the non-linear ways. You know, we've been of of growing revenue of developing new products for the past few quarters. We've included a slide. I don't know if it's slide 4. We can take a look but you know whether that's right or not there's a slide in there that shows the extent of our assets. Part of that slide is meant to demonstrate that. You know, we have

While I still firmly believe we're going to grow into that again for all the reasons that I talked about earlier.

It doesn't mean that this isn't a good opportunity to go take a look and say what's the next wave it's always happened.

Chris Winfrey: I mentioned we have recently signed up with Amazon to do data offloadings, saves them money, has better connectivity. We've done the same thing with Nexar, which you'll find in different car ride-share services as video cameras for offload. You could think about what could we bring to the EV community in terms of offload and the amount of bandwidth that comes into a garage every single night and save those providers money, which actually ends up saving customers money. You could think about our location-based services behind the modem or with our seamless connectivity abroad in terms of financial transactions and managing cybersecurity risk in a low-latency environment in ways that you could monetize that. That facilitates transactions for a B2B provider, but also makes the network safer for financial fraud for our end-user customers in a way that could be relatively unique.

Thanks, Michael.

Leila will take our last question. Please.

Your last question will come from Peter Zaffino with Wolfe Research.

Good morning, a financial question.

Great job of covering a lot of the operational topics today.

Historically your charter has structured its debt.

Facilities. Um and we have connectivity capabilities that I think are genuinely of interest to, you know, a much broader uh, array of B2B partners and could also create additional, you know, even residential products for us over time. But I, I mentioned, you know, we have recently signed up with Amazon to do data offloading and saves the money. It has better connectivity, and we've done the same thing with nexxar, which you'll find in different car ride, share Services is video cameras. So for offload, but you can think about, you know, what could we bring to the EV community in terms of offload and the amount of bandwidth that comes into our garage every single night?

um,

Really intelligently so that the maturities are fairly evenly ladder and the rates are fairly fixed.

With rates higher today, and with growth coming in below where I'm sure all of US expected a few years ago.

I wonder what it would.

To make it interesting for charter to start paying down debt maturities over the next few years understanding that it is your conviction that cable broadband will grow again, if we're all wondering what we'd do if it doesn't.

So thanks.

Okay.

Yes so.

Chris Winfrey: If you move on, you'll see on that page, there's 1,000 hubs and localized data centers. These are not hyperscaler data centers. They're generally much smaller. They have a little bit less, a lot less power. We're exploring different use cases for what you could do there with respect to edge CDN, could AI inferencing be there? I think there's a huge set of assets that exist in our footprint that are untapped as it relates to new B2B and B2C products. There's nothing here that I can sit here and tell you is material today. We're pretty active in talking to different people across the country and, in fact, globally about different ways that we can make better use of these assets to revalue consumers and to bring new revenue streams to us. In some sense, that's the history of cable.

And, you know, save, you know, those providers money, which actually ends up saving customers money, you could think about, you know, our location based Services, you know, behind the modem or with our seamless connectivity, you know, abroad, in terms of financial transactions and managing cyber security risk in the low latency environment in ways that you can monetize that, that uh, facilitates transactions for a B2B provider but also makes the network safer for financial fraud for our end user customers in a way that could be relatively unique.

No Peter we we reevaluated our target leverage ratio.

So, and then you know, move on and you'll see, you know, on that page there's, you know, a thousand.

All the time in spite of the fact that we have to change it very often.

And we do that in the context of all of the things you are talking about whether it's interest rates.

Or growth prospects for the business sort of how we how we see the long term trajectory.

All of the business and and right now I like to say, how we see the long term trajectory of cash flow.

Given given what we see across the business today, and what we think that we will be able to do as we bring together our business and the Cox, that's nice and reap substantial benefit.

That effect out of that out of that transaction I think where we're comfortable with the standalone business, where it is today at at or just under a point a quarter.

Chris Winfrey: If you step back, broadband was never a product. Voice over IP telephony was never a product. Mobile was never a product. It all came on the backbone of these assets that we have in providing connectivity services. While I still firmly believe we're going to grow internet again for all the reasons that I talked to Craig about earlier, that doesn't mean that this isn't a good opportunity to go take a look and say, "What's the next wave?" It's always happened. Thanks, Michael. Leila, we'll take our last question, please. Your last question will come from Peter Supino with Wolf Research. Good morning. A financial question. I think you all have done a great job of covering a lot of the operational topics today. Historically, Charter has structured its debt really intelligently so that the maturities are fairly evenly laddered and the rates are fairly fixed.

Hubs and localized data centers. These are not hyperscaler data centers. They're they're generally much smaller, they have a little bit less, you know, a lot less power. Um, and we're exploring different use cases. For, you know, what you could do there with with respect to Edge. CDN, could AI inferencing be there? I think, you know, the there's a, there's a huge set of assets that exist in our footprint that are untapped as it relates to new B2B, and b2c products, there's nothing here. That's, I can sit here and tell you this material today, but we're pretty active in talking to different people across the country. And in fact, globally about different ways that we can make better use of these assets to revive the consumers and to bring new revenue streams to us. So, that's in some sense, that's the history of cable, you know, if you if you step back, you know,

Batteries never a product.

When you pro forma in the Liberty that and then and then <unk>.

Time out when we when we bring in the Fox assets as assuming that the transaction closes.

On its own sort of moving the leverage ratio down a bit and then targeting ad.

At the midpoint of that three five to four times range over time.

Voice over IP telephones number of product. Mobile was never a product and it all came on the backbone of these assets that we have in providing connectivity services. And, and while I still, you know, firmly, believe, you know, we're going to grow internet again for all the reasons that I talked to Craig about earlier. It doesn't mean that, you know, this isn't a good opportunity to go. Take a look and say, what's the next wave. It's always happened.

What that what that means is that we will do sort of somewhat less borrowing I mean I am sure that you can see we have pretty limited towers over the next couple of years.

Uh, liya will take our last question, please.

Your last question will come from Peter Spino with Wolfe Research.

And on top of that to be in a place where we would be.

Good morning uh a financial question. I think we you all have done a great job of covering a lot of the operational topics today.

I'm planning to reduce the leverage ratio that the total amount of borrowing that we do it does.

So naturally cell phone it in that period, but I think it strikes a nice balance between being able to continue to return capital to shareholders, which I think is an important part of our business.

Chris Winfrey: With rates higher today and with growth coming in below where I'm sure all of us expected a few years ago, I wonder what it would take to make it interesting for Charter to start paying down debt maturities over the next few years, understanding that it is your conviction that cable broadband will grow again. I think we're all wondering what we do if it doesn't. Thanks. Peter, we reevaluate our target leverage ratio all the time in spite of the fact that we don't change it very often. We do that in the context of all of the things you're talking about, whether that's interest rates or growth prospects for the business, sort of how we see the long-term trajectory of the business. Right now, I would say how we see the long-term trajectory of cash flow.

Keeping leverage on the business at a time when there is dramatic free cash flow growth that's coming.

In a way that I think will provide significant value to shareholders.

And managing risk in a way that's appropriate.

Historically, Charter has structured, its debt, uh, really intelligently. So that the maturities are fairly evenly laddered in the rates are fairly fixed, um, with rates higher today, and with growth coming in below where I'm sure all of us expected a few years ago. Um, I wonder what it would take to make it interesting for Charter to start paying down that maturity is over the next few years understanding that it is, your conviction that cable Broadband will grow. Again, I think we're all wondering what we do if it, if it doesn't. Uh, so thanks.

We still in the Standalone business and then even more so in the combined business generate a substantial amount of cash flow. So that if we did need to delever at some point in the future from a risk perspective, I think we're more than capable of doing so.

So I continue to be happy with where with where we are and in the and the guidance that we've given today, but it doesn't mean that we won't continue to evaluate we will we always have and if its prudent for us to make a move very well.

Our target leverage ratio remains consistent all the time, in spite of the fact that we don't change it very often.

Just to understand.

Chris Winfrey: Given what we see across the business today and what we think that we will be able to do as we bring together our business and the Cox business and reap substantial benefits out of that transaction, I think we're comfortable with the standalone business where it is today at just under 4.25. When you pro forma it in the Liberty debt and then over time, when we bring in the Cox assets, assuming that the transaction closes, that on its own sort of moves the leverage ratio down a bit and then targets at the midpoint of a 3.5 to 4 times range over time. What that means is that we will do somewhat less borrowing. I'm sure that you can see we have pretty limited towers over the next couple of years.

That's just going to add to that is probably a great way to end the call today that the free cash flow that we've talked about it's mechanical because it's because of the massive step down in capital expenditure is mechanical and it happens whether or not there's.

Um and we do that in the context of all of the things that you're talking about whether that's industry uh or growth prospects for the business sort of how we how we see the long-term trajectory um of the business. And and right now, I would say how we see the long-term trajectory of cash flow.

Some of our high EBITDA growth rates, so it's happening either way and I think everybody knows we typically because we wanted to make sure that we can make the right capital allocation decisions dynamically to create value for shareholders. We typically don't give a lot of financial outlook, but to the extent, we do we understand the importance of hitting it.

And it given given what we see across the business today. Um, and what we think that we will be able to do as we bring together our business and the Cox business and and reap substantial benefits. Um out of that out of that transaction. Um, I think we're, we're comfortable with the Standalone business where it is today at at, for just under 4 and a quarter. Um, when you perform it in the Liberty debt and then and then

That includes your Capex that includes a commitment to.

EBITDA growth and free cash flow and in.

Particularly free cash flow and so that means that you can delever fast if you needed tier wanted to at any time so.

Okay.

Over time, when we bring in the Cox assets, assuming that the transaction closes, that on its own sort of moves the leverage ratio down a bit, and then targeting at the midpoint of a 3.5 to 4 times range over time.

It's a very repetitive what just interest out of it I felt like I wanted to add that in.

But it's probably important to saying look we continue to have confidence in the business.

And our ability to create the free cash flow, but I think we've talked about it for shareholders.

Chris Winfrey: On top of that, to be in a place where we would be planning to reduce the leverage ratio, the total amount of borrowing that we do does sort of naturally self-limit in that period. I think it strikes a nice balance between being able to continue to return capital to shareholders, which I think is an important part of our business, keeping leverage on the business at a time when there is dramatic free cash flow growth that's coming, in a way that I think will provide significant value to shareholders, and managing risk in a way that's appropriate. We still, in the standalone business and then even more so in the combined business, generate a substantial amount of cash flow so that if we did need to deliberate at some point in the future from a risk perspective, I think we're more than capable of doing so.

And in the ability and in the medium and long term broadband assets to deliver the kind of connectivity that people will need to run the products that will come to the marketplace and so with that confidence I think we continue to be in a place that we believe that we can.

Um, what that, what that means is that we will do sort of somewhat less borrowing. I mean, I I'm sure that you can see we have pretty limited, um, Towers over the next couple of years. Uh, and on top of that to be, uh, in a place where we would be, um,

Planning to reduce the leverage ratio. The total amount of borrowing that we do does...

We can continue to create that value for shareholders going forward.

Thank you very much.

Thanks, Laila that ends our call I'll turn it back to you.

Okay.

Thank you everyone for joining today the call has concluded and you may now disconnect.

Chris Winfrey: I continue to be happy with where we sit in the guidance that we've given today. It doesn't mean that we won't continue to evaluate. We always have, and if it's prudent for us to make a move, we will. Understood. Thank you. I'm just going to add to that. It's probably a great way to end the call today. The free cash flow that we've talked about, it's mechanical. It's because of the massive step down in capital expenditures. It's mechanical, and it happens whether or not there's some or high EBITDA growth rate. It's happening either way. I think everybody knows we typically, because we want to make sure that we can make the right capital allocation decisions dynamically to create value for shareholders, we typically don't give a lot of financial outlook. To the extent we do, we understand the importance of hitting it. That includes CapEx.

Um, sort of naturally self limit in that period, but I think it, it strikes a nice balance between being able to continue to return Capital to shareholders, which I think is an important part of our business. Um, keeping leverage on the business at a time when there is dramatic free cash flow growth. That's coming, uh, in a way that I think will provide significant value to shareholders, um, and managing risk in a way that's appropriate. I mean, we, we still in the Standalone business and then even more. So in the combined business generate a substantial amount of cash flow. So that if we did, um, need to de-lever at some point in the future, we from a risk perspective, I think we're more than capable of doing so.

so I, I

Continue to be happy with where, with where we fit, uh, in in the, in the guidance that we've given today, but it doesn't mean that we won't continue to evaluate, we will, um, we always have. And, and if it's prudent for us to make a move, we will, I think just to understand, I'm just going to add to that is, is probably a great way to to call today. The, the free cash flow that we've talked about. Its mechanical, it's, it's, uh, because the the massive step down in capital expenditure its mechanical. And and it happens, you know, whether or not there's, you know, some or high, you know, even that growth rate. So, it's, it's happening either way. And I think everybody knows we typically because we want to make sure that we can

Chris Winfrey: That includes a commitment to EBITDA growth and free cash flow, and particularly free cash flow. That means that you can deliver fast if you needed to or wanted to at any time. It's very repetitive of what Jessica just said, but I felt like I wanted to add that in. It's probably important to say, look, we continue to have confidence in the business and in our ability to create this free cash flow growth that we've talked about for shareholders, and in the ability in the medium and long term for the broadband asset to deliver the kind of connectivity that people will need to run the products that will come to the marketplace. With that confidence, I think we continue to be in a place where we believe that we can continue to create good value for shareholders going forward. Thank you so much. Thanks.

And make the right Capital, allocation decisions, dynamically to create value for shareholders. We typically don't give a lot of financial Outlook, but to the extent we do we understand the importance of hitting it. That includes, you know, capex that include

commitment to

Have it that growth uh and free cash flow and uh, particularly free cash flow and so that means that you can deliver fast if you needed to or wanted to at any time. And so

Anyway, it's a very repetitive what Jess said but I thought like I wanted to add that in. Yeah, but but it's probably important to say, look, we we continue to have confidence in the business. Uh, and in our ability to create this free cash flow growth that we've talked about for shareholders.

Medium, and long term for the, the Broadband asset to deliver, the kind of connectivity that people will need to run the products that will come to the marketplace. And so with that confidence, I I think we we continue to be in a place where we believe that we can um we can continue to create good value for shareholders going forward.

Chris Winfrey: Leila, that ends our call. I'll turn it back to you. Thank you, everyone, for joining today. The call has concluded, and you may now disconnect.

Thank you so much.

Thanks. Leila that ends our call. I'll turn it back to you.

Thank you, everyone, for joining today. The call is concluded, and you may now disconnect.