Charter (CHTR) Q2 Earnings Beat, Internet Revenues Rise Y/Y

Financial Performance - Free cash flow totaled $1.29 billion, significantly up from $668 million in Q2 2023, driven by higher adjusted EBITDA, favorable working capital changes, and lower cash taxes due to timing [1] - Second-quarter adjusted EBITDA was $5.7 billion, reflecting a 2.6% year-over-year growth, with an adjusted EBITDA margin of 41.4%, up 10 basis points year-over-year [6] - Net cash flows from operating activities reached $3.9 billion, compared to $3.3 billion in the prior year [7] - Revenues for the quarter were $13.68 billion, a 0.2% increase year-over-year, exceeding consensus estimates by 0.2% [9] Revenue Breakdown - Residential revenues amounted to $10.76 billion, down 0.6% year-over-year [10] - Voice revenue decreased by 4.2% year-over-year to $350 million, attributed to a decline in wireline voice customers [11] - Commercial revenues grew by 2.1% year-over-year to $1.8 billion, driven by enterprise and SMB revenue growth [12] - Advertising sales revenues increased by 3.3% year-over-year to $397 million, primarily due to higher political revenues [13] Customer Statistics - Total residential and SMB Internet customers decreased by 0.7% year-over-year to 30.36 million, with a loss of 154,000 residential Internet customers [14] - Residential voice customers declined by 14.9% year-over-year to 6.17 million [15] - SMB customer relationships increased by 3,000 in Q2 2024, compared to an increase of 4,000 in Q2 2023 [17] - Residential video customers decreased by 9.6% year-over-year to 12.71 million [29] Cost and Expenses - Total operating costs and expenses declined by 1.4% year-over-year to $8.02 billion, with programming costs down by $268 million, or 9.8% [18] - Costs to service customers decreased by $88 million, or 4.2% year-over-year, mainly due to lower labor costs and bad debt expenses [19] - Other costs of revenues increased by $171 million, or 12.6% year-over-year, primarily due to higher mobile service direct costs [32] Debt and Liquidity - As of June 30, 2024, total principal amount of debt was $96.5 billion, with credit facilities providing approximately $4.1 billion in additional liquidity [3] - The company purchased 1.5 million shares for $404 million during the reported quarter [21]