Charter Communications: Navigating Subscriber Attrition Through Converged Connectivity and Strategic Innovation

Charter Communications (CHTR) has long been a bellwether for the cable industry's ability to adapt to shifting consumer preferences and technological disruption. In 2025, the company faces a dual challenge: mitigating broadband subscriber attrition while scaling its mobile business to offset declining demand for fixed-line services. With the end of the Affordable Connectivity Program (ACP) in May 2024, Charter lost 149,000 broadband subscribers in Q2 2024—a figure that dropped to 117,000 by Q2 2025, suggesting stabilization but not resolution. The question for investors is whether Charter's aggressive pivot to converged connectivity—bundling mobile, broadband, and streaming services—can sustain long-term growth in a market increasingly dominated by fiber overbuilders and 5G providers.

The Subscriber Attrition Dilemma

Charter's broadband subscriber base, once a cornerstone of its revenue model, has faced headwinds from affordability crises and mobile substitution. The ACP's expiration disproportionately impacted low-income households, leading to a 5% drop in its 5 million ACP-enrolled customers. However, the company has retained the majority of these users, partly due to its transparent pricing guarantees and bundled offerings. For example, Spectrum TV Select packages now include ad-supported streaming services like Disney+ and Hulu, effectively bundling traditional TV with digital-first alternatives. This strategy has slowed video subscriber losses, with declines shrinking from 408,000 in Q2 2024 to 80,000 in Q2 2025.

Yet, the broader broadband market remains competitive. Fiber overbuilders like Lumen and 5G fixed wireless providers such as T-Mobile are gaining traction in suburban and rural markets. Charter's response? A dual strategy: accelerating fiber deployments and leveraging its mobile business to drive cross-sell opportunities.

Mobile as a Growth Engine: Bundled Offerings and CBRS Deployment

Charter's mobile segment has emerged as a bright spot. In Q1 2025, the company added 514,000 mobile lines, outpacing T-Mobile's 495,000 postpaid additions. Spectrum Mobile, its MVNO offering, now serves 10.9 million lines, with revenue growing 35% year-over-year to $834 million. The key to its success lies in bundling. By offering mobile services to existing broadband customers at no extra cost, Charter has achieved a 20% cross-sell rate, significantly higher than traditional carriers. For instance, Spectrum's “Anytime Upgrade” feature allows customers to switch to mobile plans without contract penalties, while its satellite-based services, launched in collaboration with Skylo, expand coverage in underserved areas.

The company's Citizens Broadband Radio Service (CBRS) deployment further enhances this strategy. By offloading 87% of mobile traffic onto its own Wi-Fi and CBRS networks, Charter reduces reliance on Verizon's infrastructure, cutting costs and improving service reliability. This shift is critical: CBRS allows Charter to manage mobile traffic more efficiently, enabling faster speeds and lower latency—key differentiators in a market where customers prioritize performance. As of Q2 2025, Charter has deployed CBRS in 23 markets, with plans to expand to high-usage areas in 2026.

Financial Resilience and Valuation Implications

Despite its high debt load ($96.5 billion as of Q2 2025), Charter's financials remain robust. Revenue grew 0.2% year-over-year to $13.7 billion in Q2 2025, with adjusted EBITDA up 2.6% to $5.7 billion. The company's capital expenditures of $2.9 billion reflect a focus on network evolution, including HFC upgrades and fiber deployments. Investors have responded positively, with the stock surging 16% in early trading after Q2 2024 results, outperforming peers like T-Mobile and Verizon.

However, skeptics argue that Charter's debt-heavy approach could constrain flexibility. At a debt-to-EBITDA ratio of 8.2x, the company faces higher interest costs than T-Mobile's 5.8x. Yet, its mobile business's rapid growth and margin expansion (driven by CBRS and Wi-Fi offloading) suggest a path to deleveraging. Analysts at Bernstein note that Charter's mobile EBITDA margins could reach 15-20% by 2027, up from current levels of 8-10%, as scale and network efficiency improve.

Strategic Risks and Regulatory Uncertainty

The long-term viability of Charter's strategy hinges on two factors: regulatory support for shared-spectrum models and the pace of CBRS adoption. The House Energy and Commerce Committee's proposed 600 MHz exclusive spectrum auction could limit CBRS's potential, favoring traditional carriers like Verizon. Meanwhile, 5G overbuilders are pushing for policies that would require cable companies to compete on equal footing, potentially slowing Charter's network evolution.

Technologically, Charter's reliance on MVNO partnerships and CBRS exposes it to vendor lock-in risks. Delays in equipment certification for DOCSIS 4.0, for example, have pushed back its deployment to 2027, giving competitors a head start in multi-gigabit speeds. Additionally, while bundled offerings have reduced churn, they may compress margins if customers prioritize affordability over premium services.

Investment Thesis and Valuation Outlook

For investors, the question is whether Charter's converged connectivity model can replicate the success of Amazon's Prime ecosystem—leveraging cross-sell to drive customer lifetime value. The company's mobile subscriber growth, CBRS deployment, and bundled offerings suggest it is on the right track. However, the path to profitability remains uncertain.

A discounted cash flow analysis implies a fair value of $350-$370 per share by 2027, assuming 10% annual EBITDA growth and a 9x EBITDA multiple. This aligns with current analyst estimates but lags behind peers like T-Mobile, which trades at a 12x multiple. The gap reflects market skepticism about Charter's debt burden and regulatory risks.

Conclusion: A Calculated Bet on Convergence

Charter's converged connectivity strategy is a calculated bet on the future of home and mobile services. By bundling offerings, deploying CBRS, and leveraging its broadband base, the company is addressing subscriber attrition while positioning itself for 5G-driven growth. However, investors must weigh the risks of regulatory headwinds, competitive pressures, and debt management. For those willing to tolerate near-term volatility, Charter's innovative approach and improving subscriber trends make it a compelling long-term play in the evolving telecom landscape.

Investment Advice: Buy for the long term (3–5 years) with a focus on mobile-led growth and network efficiency. Monitor regulatory developments and CBRS adoption rates closely.