STAMFORD — The customer base for telecommunications giant Charter Communications grew significantly in the past quarter as it benefited from rising demand for internet service, the company reported Friday.
In the second quarter, the Stamford-based company added about 751,000 residential customers and 4,000 small and medium-size business consumers, compared with a combined gain of 203,000 in the same period last year. It also connected an additional 325,000 Spectrum Mobile lines.
Reflecting the spike in working from home this spring amid the national spread of the coronavirus crisis, residential internet connections across Charter’s 41-state footprint grew 8.5 percent year over year. In comparison, connections for video and “voice” phone services, respectively, dipped 1 percent and 4 percent from a year ago.
The combined number of residential customers and business customers in the second quarter totaled 30.5 million, up 6 percent from the same period last year.
“We remain focused on serving our customers and the communities where we operate through a difficult period of time,” Charter CEO and Chairman Tom Rutledge said on a call with investment analysts. “These services have been able to promote working, distant learning, tele-health services and family communication in support of the broader economy and the welfare of our communities.”
Quarterly revenues for the No. 71 company on last year’s Fortune list increased 3 percent year over year, to nearly $12 billion.
Profits totaled about $766 million, compared with $314 million a year ago. The burgeoning bottom line was driven by higher adjusted earnings, a non-cash gain on financial instruments compared with a loss in the 2019 second quarter and lower depreciation and amortization costs.
Charter shares closed Friday at about $580, up 3 percent from their Thursday finish. They opened the day at a 52-week high of about $594. During the quarter, Charter purchased about 2.3 million shares of Charter Class A common stock and Charter Holdings common units, worth a total of approximately $1.2 billion.
To assist communities affected by the pandemic, Charter launched in March a “Remote Education Offer,” which has provided free Spectrum-branded internet service for 60 days to households with students in the K-12 and/or college systems, as well as educators who do not already have Spectrum internet.
Through June 30, about 448,000 internet customers had been added through the program. Of that total, 160,000 were still receiving free service after June 30.
In the past quarter, Charter also took part in the Federal Communications Commission’s Keep Americans Connected Pledge, which suspended disconnections and collection payments for residential customers and small and medium businesses financially hurt by the crisis.Read Full Article
About 600,000 residential customers and 100,000 business consumers requested protection from disconnection. At its peak, the initiative was serving about 208,000 residences and 14,000 businesses that would have been disconnected under regular collection policies.
In turn, Charter said it waived $76 million of receivables for residences, as well as $6 million for businesses and $3 million for mobile accounts.
Charter has also been offering a seasonal plan, with reduced rates, to small and medium businesses that have temporarily closed or reduced their own services.
Among other initiatives, the company has opened its WiFi “hot spots” to the public.
Charter has maintained its operations throughout the pandemic through its government designation as an essential-services provider.
In April, the company pledged to raise its minimum wage for all hourly workers from $15 per hour to $20 per hour during the next two years and also announced that it would not lay off or furlough any employees for at least the next two months.
But the company has also faced scrutiny of its workplace environment.
The office of New York Attorney General Letitia James confirmed in April that it had launched an inquiry into Charter’s coronavirus-related labor practices. A number of New York-based workers filed complaints about what they saw as unnecessary requests for them to continue reporting to their offices amid the spread of COVID-19.
Charter has declined to comment on the probe.
At the company’s downtown Stamford headquarters, where about 1,300 workers are based, a number of employees expressed concerns in the early spring about working conditions.
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