Altice USA Plunges 9% on Earnings Shock: Can Fiber Growth Salvage the Downturn?

Summary
• Altice USA (ATUS) slumps 8.99% intraday to $2.175, its lowest since March 2023
• Q2 revenue falls 4.2% to $2.15B, missing estimates and reversing year-ago profit
• Free cash flow turns positive at $28M, but broadband subscriber losses persist

Altice USA’s stock imploded in after-hours trading following a disastrous Q2 earnings report. The cable giant’s revenue and earnings per share (EPS) both missed estimates, with GAAP losses widening to $0.21/share. Despite fiber and mobile growth, the stock’s 8.99% drop reflects investor skepticism over subscriber attrition and high debt. The day’s $2.125 low underscores a bearish technical setup amid deteriorating fundamentals.

Earnings Miss and Subscriber Attrition Trigger Sell-Off
Altice USA’s 8.99% intraday plunge was driven by a disastrous Q2 earnings report. Revenue fell 4.2% to $2.15B, missing estimates, while GAAP EPS plunged to -$0.21, a 700% decline from last year’s $0.03 profit. The stock’s collapse reflects deteriorating core metrics: broadband subscriber losses of 35,000 and a 6% year-over-year revenue drop in residential services. Despite fiber growth accelerating to 53% year-over-year, the market punished the company for its inability to reverse declining broadband and video segments. Free cash flow, while positive at $28M, is overshadowed by $23.6B in net debt and a 7.8x leverage ratio.

Cable & Satellite Sector Under Pressure as Altice Lags
The broader Cable & Satellite sector, led by Comcast (CMCSA -1.41%), is grappling with cord-cutting and streaming competition. Altice’s 8.99% drop outpaces sector declines, reflecting its unique challenges: 7.8x leverage, declining broadband ARPU, and a $23.6B debt burden. While peers like Charter Communications (CHTR) and Cox (CABV) show better subscriber retention, Altice’s 35,000 broadband losses and 4.2% revenue decline highlight structural weaknesses. The sector’s -1.41% move underscores macro risks, but Altice’s fundamentals—high debt, subscriber attrition—make it an outlier.

Bearish Setup: Key Levels and Options for Short-Term Bets
• 200-day MA: $2.52 (above current price)
• RSI: 33.65 (oversold)
• MACD: 0.01 vs. signal line 0.064 (bearish divergence)
• Bollinger Bands: Price at $2.175 (near lower band at $2.329)

Altice’s technicals confirm a short-term bearish bias. The stock is trading below its 200-day MA and RSI is in oversold territory, but this could signal a continuation of the downtrend rather than a reversal. Key support levels at $2.10–$2.12 (30D support) and $2.64 (200D resistance) will dictate near-term direction. The 30D/200D support/resistance gap (2.09–2.66) suggests a potential 25% downside risk if the breakdown occurs.

Top Options Picks:
• ATUS20250919C2.5 (Call, $2.5 strike, 9/19 expiry):
- IV: 103.88% (high volatility)
- Delta: 0.424 (moderate sensitivity)
- Theta: -0.004184 (moderate time decay)
- Gamma: 0.499 (high sensitivity to price swings)
- Turnover: $3,000 (moderate liquidity)
- Leverage: 10.87% (high)
- Payoff (5% downside): $0.00 (strike above current price)
- Why it stands out: High gamma and IV make this call ideal for a sharp rebound if the stock breaks above $2.50. The 10.87% leverage amplifies gains in a bullish reversal.

• ATUS20260116C2.5 (Call, $2.5 strike, 1/16/26 expiry):
- IV: 69.55% (moderate volatility)
- Delta: 0.489 (moderate sensitivity)
- Theta: -0.001434 (low time decay)
- Gamma: 0.394 (moderate sensitivity)
- Turnover: $1,566 (high liquidity)
- Leverage: 7.25% (high)
- Payoff (5% downside): $0.00 (strike above current price)
- Why it stands out: Long-dated call with high liquidity and moderate IV. The 7.25% leverage and low theta make it a speculative play for a multi-month rebound.

Trading View: Aggressive bulls may consider ATUS20250919C2.5 into a bounce above $2.50. If $2.10 breaks, short-term puts like ATUS20250919P2 (IV: 41.89%) could offer downside protection.

Backtest Altice USA Stock Performance
After a -9% intraday plunge, ATUS has historically shown mixed short-to-medium-term performance. The 3-day win rate is 48.72%, with an average return of 0.03%. The 10-day win rate is 43.45%, with a slight negative return of -0.85%. The 30-day win rate is 44.25%, with a maximum return of 0.12% over 30 days, indicating a potential for recovery but with limited upside.

Altice at Crossroads: Fiber Growth vs. Debt Overhang
Altice USA’s 8.99% drop reflects a perfect storm of earnings misses, subscriber attrition, and high leverage. While fiber growth (53% YoY) and mobile expansion (42% YoY) offer long-term hope, the immediate outlook remains bleak. The stock’s technical breakdown below $2.329 and RSI in oversold territory suggest further declines to test $2.10 support. Investors should monitor the 30D/200D support/resistance gap (2.09–2.66) and watch for a potential $2.10 breakdown. Action: Short-term traders may target $2.10–$2.12 with stop-loss above $2.33. Long-term investors should wait for a clearer inflection point in fiber adoption and debt restructuring. Meanwhile, sector leader Comcast (CMCSA -1.41%) highlights the broader industry’s struggles, reinforcing Altice’s precarious position.