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Analyzing Expectations for Charter Communications’ Q3 Earnings Report

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Charter Communications Prepares for Q3 Earnings Release with Promising Metrics

Charter Communications (CHTR) is set to announce its third-quarter 2024 results on November 1.

The Zacks Consensus Estimate for Q3 revenues stands at $13.7 billion, which reflects a slight increase of 0.86% from the same period last year.

As for earnings, the consensus estimate has dipped by 0.5% to $8.55 per share over the past month, pointing to a growth of 3.84% compared to the prior year’s results.

In the past four quarters, CHTR managed to beat the Zacks Consensus Estimate twice while missing it on two occasions, resulting in an average negative surprise of 0.55%.

Check out the latest EPS estimates and surprises on the Zacks Earnings Calendar.

According to the Zacks model, possessing a positive Earnings ESP and a Zacks Rank of #1 (Strong Buy), #2 (Buy), or #3 (Hold) heightens the likelihood of a positive earnings surprise. Currently, CHTR holds an Earnings ESP of +2.71% and a Zacks Rank of #3.

Now, let’s explore the factors shaping the upcoming earnings report.

Charter Communications: Price Movements and EPS Trends

Charter Communications, Inc. Price and EPS Surprise

Charter Communications, Inc. price-eps-surprise | Charter Communications, Inc. Quote

What to Watch For

Charter’s efforts in enhancing network infrastructure, particularly through its Spectrum division, may bolster its potential for the reported quarter. Investments in fiber-optic technology have been critical to these advancements.

A key feature this quarter is the enhancements in Spectrum’s offerings. Spectrum Reach has recently partnered with Amazon (AMZN) Ads to become a local reseller for advertising inventory, which could open new revenue streams.

Additionally, Charter has rolled out its Gigabit Broadband, Mobile, TV, and Voice Services in several new areas, including parts of Missouri, Georgia, Alabama, and North Carolina.

In another significant move, the ad-supported version of Paramount Global’s (PARA) streaming service, Paramount+ Essential, is now accessible through various Spectrum TV packages at no extra charge.

Moreover, a multi-year partnership with Warner Bros. Discovery (WBD) has been announced, allowing Spectrum to carry a range of WBD’s linear networks, including popular channels like CNN and HGTV.

CHTR’s residential revenues are anticipated to reflect stable growth in its mobile services, although reductions in voice and video revenues may present challenges. The Zacks Consensus Estimate predicts total residential revenues will reach $10.71 billion, down 0.2% from the previous year. It also estimates a decline in total residential customer relationships to 31.69 million, suggesting a drop of 1.7% year over year.

As of June 30, 2024, CHTR had reported 31.8 million residential and SMB customer relationships. The company added 557,000 residential and SMB mobile lines in the second quarter, and analysts forecast another 600,000 additions in Q3.

Despite these positive indicators, CHTR may face headwinds from increased competition and slow growth in internet subscribers, which could impact its overall performance.

Noteworthy Q3 Developments

A collaboration between Charter Communications, Broadcom, and Comcast aims to develop Unified DOCSIS chipsets for network nodes, smart amplifiers, and cable modems, pushing the boundaries of existing network speeds to over 25 Gbps.

In addition, Charter and AMC Networks have renewed their distribution agreement, ensuring that Charter can carry AMC’s channels for several more years. AMC+ will now be available for purchase by Charter’s millions of internet-only customers.

A partnership with CableLabs led to the launch of Bryte IQ, a Network-as-a-Service platform designed to enhance both wired and wireless service offerings.

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For more on the stocks mentioned, check out: Amazon.com, Inc. (AMZN), Charter Communications, Inc. (CHTR), Warner Bros. Discovery, Inc. (WBD), and Paramount Global (PARA).

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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