Cable One 2025 Q3 Earnings Surges 95.7% in Net Income Despite Revenue Decline

Cable One (CABO) reported Q3 2025 earnings that exceeded expectations in profitability but fell short on revenue. The company’s net income surged 95.7% year-over-year to $86.53 million, driven by a 95% EPS increase to $15.33, while total revenue declined 4.1% to $351.87 million. The stock price, however, faced downward pressure post-earnings, dropping 24.57% month-to-date. Management emphasized strategic execution to address challenges in residential data churn and video declines but provided no explicit forward guidance.

Revenue

Cable One’s revenue contraction was broad-based, with residential data remaining the largest contributor at $227.60 million. Business data followed at $57.49 million, while residential video and voice generated $44.97 million and $6.69 million, respectively. The business “other” segment added $15.12 million, and non-core activities accounted for $24.15 million. Despite modest growth in new connections, higher-than-expected residential data churn offset gains, underscoring ongoing subscriber retention challenges.

Earnings/Net Income

The 95% EPS growth and 95.7% net income surge highlight strong profitability, despite revenue contraction.

Price Action

Post-earnings, Cable One’s stock fell sharply, declining 24.57% month-to-date and 8.13% in the latest trading day. However, historical backtesting revealed that buying shares on earnings announcement dates and holding for 30 days yielded 31.8% cumulative returns over three years—outperforming a buy-and-hold strategy by 16.6 percentage points. The first two years contributed 27.2% of this return, while the third year lagged at 4.1%, underscoring event-driven momentum potential.

CEO Commentary

Julie Laulis, President and CEO, acknowledged headwinds, including declining residential video demand and modest business data growth of 0.4%. She emphasized disciplined execution of a multi-phase strategy to stabilize performance and reduce churn, though the lack of near-term guidance left investors with limited clarity on future trajectory.

Guidance

The company did not issue formal forward-looking guidance, instead reiterating strategic priorities to address subscriber attrition and operational efficiency.

Additional News

Cable One’s debt reduction efforts gained traction, with $200 million in paydowns during Q3. The CEO announced a mobile service pilot to diversify offerings, aiming to mitigate reliance on declining broadband segments. Meanwhile, the company’s shares traded at a 58.4% discount to the median analyst price target of $345, reflecting undervaluation amid strategic restructuring. Analysts remain split, with a “hold” consensus despite peers in the telecom sector leaning toward “buy” recommendations.