Charter Communications pushed its expected cost synergies from the Cox acquisition above $1 billion, up from an initial $800 million target, during a presentation at the Goldman Sachs Communacopia + Technology Conference on Wednesday.
Chief Executive Officer Chris Winfrey said the company also expects capital expenditures to drop from the mid-$11 billion range to below $8 billion in the near term, calling the reduction "the conclusion of two very successful one-time investment programs" rather than a pullback.
Winfrey stressed the company was shifting focus back to broadband growth. "We got to return to growth," he said. "Everything that we do is really about prioritizing broadband growth. It's exactly what we have to do."
The company reported standalone EBITDA guidance for a 1% decline remained on track, though figures are now presented on a combined basis with Cox using pro forma financial statements. The Cox transaction closed a couple of weeks before the conference, and a full rebrand of former Cox markets to Spectrum is set within about a week.
Charter noted significant untapped opportunities in former Cox markets. Mobile penetration there is described as nearly nonexistent compared with roughly 20% at legacy Spectrum. Video penetration in those areas sits at about 10%. Charter has hired more than 1,000 sales employees in former Cox markets and plans to gradually move offshore call center work onshore.
Spectrum serves as the leading internet and video provider across 70 million passings in 45 states, with about 35 million additional passings not yet served by Charter. The company is promoting bundling savings of more than $1,000 for customers who combine two mobile lines with internet service. Broadband customers who also take video show 40% lower churn than video-only customers.
On the infrastructure side, Charter operates more than 1,200 local edge data centers, with approximately 250 megawatts of fallow capacity across roughly 600 facilities. A subsidized rural expansion program is scheduled to conclude by the end of 2026, and the network evolution upgrade is expected to largely finish by late 2027.
The Spectrum TV App includes about $130 worth of programmer apps. Shares of Charter closed at $151.99, up 0.4%.
Nick Jeffery, who joined as chief operating officer on September 1, will work alongside executive Richard DiGeronimo. Chief Financial Officer Jessica Mester announced she is leaving for an outside opportunity and will stay through the middle of October.
