Hey there, bargain hunter. Charter Communications dropped its Q3 2026 results at 7:00 a.m. ET this morning, with the earnings call following at 8:30. This is the first quarterly report since the $34.5 billion Cox acquisition closed on August 20. The numbers that matter most are not on the income statement. They are the subscriber counts.
Scoreboard
Consensus heading into today: roughly $13.48 billion in revenue and EPS around $10.06, depending on which estimate desk you trust. The prior quarter, Q2 2026, delivered $13.526 billion in revenue (down 1.7% year over year) and EPS of $10.66. Charter has beaten in one of the last four quarters and missed in three, with an average negative surprise of 3.02%. Wall Street is not giving this stock the benefit of the doubt.
The Real Reason This Report Matters
The broadband bleed is accelerating. Charter shed 172,000 internet customers in Q2 2026, compared to 116,000 losses in the same quarter a year earlier. Broadband ARPU dropped to $70.16, falling both sequentially and year over year. Management promised Q3 would look better as the most aggressive retention discounts rolled off. Today is the first test of that claim.
Meanwhile, Spectrum Mobile added 406,000 lines in Q2, taking the total base to 12.5 million. Mobile service revenue rose 18.9% to $1.1 billion. That is a real business. The question is whether it is big enough, and fast enough, to plug the hole in the core.
How Charter Actually Makes Money
Charter sells broadband, video, and voice to 29.4 million internet customers across the U.S. under the Spectrum brand. Mobile is an MVNO layered on top: Charter resells capacity from Verizon’s network but offloads about 87% of its mobile traffic primarily through its Wi-Fi footprint, which keeps unit costs low. The bundle is the strategy. Customers who take both internet and mobile churn about 40% less than internet-only customers. That retention math is what makes the mobile push more than a revenue line; it is a churn firewall for the core.
The Cox deal, now closed, expands Charter’s Spectrum footprint to more than 70 million homes and businesses across 45 states. Management has pointed to about $500 million of annualized cost synergies within three years of closing, and outside observers have sometimes modeled higher figures.
Key Metrics to Track Today
- Broadband net adds: Q2 lost 172,000. Any improvement is a signal; further deterioration is a problem.
- Mobile line net adds: Q2 added 406,000, down from 491,000 in Q2 2025. Deceleration is a worry.
- Broadband ARPU: fell to $70.16 in Q2. Management said Q3 would recover. Confirm that.
- Adjusted EBITDA: fell 4.3% year over year in Q2. Margin direction tells you whether cost cuts are keeping pace.
- Free cash flow: Q2 generated $969 million. Capital expenditures are expected to run around $11.4 billion for full-year 2026 (excluding impacts from the Cox transaction), and the slope from here matters as network spending evolves.
- Leverage: net debt to EBITDA was 4.18x as of June 30, 2026. Charter has said it assumed roughly $12.4 billion of Cox net debt and finance leases, and it has flagged a post-close long-term target leverage of 3.5x Adjusted EBITDA.
- Buyback status: In Q2, Charter bought back $838 million of stock. Treat any “pause” or “resume” language as a balance-sheet signal and listen for specifics on the call.
Is It Cheap?
The trailing P/E on CHTR is roughly 3.3x. The forward P/E is roughly 2.7x. That is not a typo. The stock has been crushed, and with shares recently in the low-to-mid $120s, the market cap is roughly in the mid-teens of billions. For context, Comcast trades at a comparable discount for similar reasons. T-Mobile, which is taking some of Charter’s broadband customers with fixed-wireless offers, trades at a meaningfully higher multiple because it is growing.
Comcast is the clearest parallel — same broadband erosion, same compressed multiple, same market skepticism about whether the losses are cyclical or permanent. Comcast’s valuation has collapsed even as its free cash flow and subscriber base remain among the largest in the country.
The valuation is low because the market is not sure whether broadband losses stabilize or become structural. If they stabilize, this is deeply cheap. If they keep widening, the cheap multiple is a trap.
Bull / Base / Bear
Bull: Broadband losses narrow in Q3 as ARPU recovers from discounting, mobile adds stay above 400,000, and Cox synergies arrive faster than modeled. Free cash flow ramps as capex falls, funding deleveraging and eventual buyback resumption. The stock re-rates toward a 5-6x earnings multiple.
Base: Broadband losses stabilize but do not reverse. Mobile continues growing at a mid-teens rate. Revenue is roughly flat. The Cox integration proceeds without major disruption. Leverage declines slowly. The stock grinds sideways.
Bear: Fiber overbuilders and T-Mobile fixed wireless continue stealing broadband customers at a faster clip. ARPU fails to recover. Heavy leverage becomes a liability if rates stay higher for longer. The stock re-tests lows.
Action Plan
Do not buy ahead of the call. Wait for the broadband subscriber number and the ARPU figure. If broadband losses are narrower than Q2’s 172,000 and ARPU is recovering, the bull case gains traction and a starter position is defensible at current prices. Scale in over two tranches: half now, half after Q4 confirms the trend.
If losses worsen, stay patient. The valuation is compelling in isolation, but a business in structural decline can always get cheaper.
Cheap Investor Checklist
- Broadband net adds: target better than -172,000
- Broadband ARPU: needs to recover above $70.16
- Mobile line adds: watch for deceleration below 380,000
- Adjusted EBITDA margin: needs to stabilize after Q2’s 4.3% decline
- Free cash flow: $969M in Q2; track the trajectory as capex evolves
- Leverage: 4.18x entering Q3; direction matters more than the number
- Cox synergy update: any pull-forward of the three-year synergy target
- Buyback guidance: do they give a timeline, or stay noncommittal?
- Mobile churn benefit: is the 40% lower churn for bundled customers holding?
- Management tone on broadband return to growth: show-me language or a date?
Bottom Line
Charter at about 3x trailing earnings looks like a bargain until you remember what the market is actually pricing: a broadband business that keeps losing customers and a mobile business that grows fast but resells someone else’s network. If Q3 shows the broadband bleed narrowing and ARPU recovering, the discount is excessive and this becomes one of the more interesting value plays in large-cap telecom. If the losses widen again, the cheap multiple is exactly what it deserves.
