Charter's streaming strategy slows TV losses, but internet woes hit stock hard in Q2

Charter Communications’ strategy to slow its TV subscriber losses is working, but it wasn’t enough to prevent Wall Street from sending the company’s stock into a historic tailspin. Shares collapsed by more than 18% Friday after the cable giant’s second-quarter earnings missed analyst expectations and revealed a continued bleed in its core internet business.

Good news, bad news: According to its Q2 earnings report, Charter lost 80,000 video customers—a stark reversal from the over 400,000 who fled a year ago. However, the company also shed nearly 120,000 internet subscribers, a loss that rattled investors and overshadowed the video progress.

Leaning into the stream: Charter has staunched its TV losses by bundling ad-supported streaming apps like Disney+, Peacock, and HBO Max directly into its cable packages. This "if you can't beat 'em, join 'em" approach is designed to add value and reduce churn in a market that has been in structural decline.

The mobile bright spot: Even as its legacy businesses face headwinds, the company’s push into mobile services continues to pay off. Charter added 500,000 mobile lines in the quarter, bringing its total subscriber base to nearly 11 million and providing a crucial growth engine.

The bigger picture: The quarterly results come as Charter pushes forward with major consolidation plays. The company is navigating a pending $34.5 billion merger with Cox Communications to create a new cable behemoth, all while finalizing its acquisition of media billionaire John Malone's Liberty Broadband.