Finance

Altice USA stock sinks after tough third quarter earnings

In this article

Igor Golovniov | Lightrocket | Getty Images

Altice USA‘s shares dropped more than 20% and trading in the stock was briefly halted Thursday, after the company posted a weak earnings report.

The company, which provides broadband, cable-TV, wireless and phone services, saw its shares sink following Wednesday’s earnings report that net income and revenue fell as Altice lost subscribers and continued to spend significantly on the rollout of its fiber network.

Altice’s net income for the third quarter fell to $85 million from about $267 million compared to the same period last year. Earnings per share on a diluted basis fell to 19 cents from 58 cents last year.

Read more: Outgoing Charter CEO Tom Rutledge says there’s ‘pain to come’ as linear TV gives way to streaming

The company’s revenue fell 7% to $2.39 billion, due to the decline in residential and business services customers. Adjusted earnings before interest, taxes, depreciation and amortization fell 18% to $954.4 million compared with the prior year.

An Altice representative said the company doesn’t comment on stock moves.

Cable providers saw big gains in broadband subscribers during the early days of the pandemic, when lockdowns forced many to work and take classes from home. But in recent quarters, subscriber additions have significantly fallen off for the industry as competition from other providers has risen and there’s been a low rate of moving activity.

Altice said it lost 43,000 broadband customers during the quarter, as well as 82,000 cable-TV subscribers.

On top of this, Altice has been spending heftily to deploy a fiber network for its broadband customers. The company said Wednesday it would spend between $1.7 billion and $1.8 billion in capital expenses in the 2022 fiscal year.

“While we are operating in a very competitive environment and are starting to see some macroeconomic pressures across our business, we are confident that we have the right strategy to return to sustainable growth,” outgoing CEO Dexter Goei said in the earnings release Wednesday.

Articles You May Like

MongoDB stock jumps 27% after cloud database company shows surprise adjusted profit
ICYMI: China’s Xi said COVID in China mainly Omicron, was less lethal, allows more openess
USD/MXN: Mexican Peso resilience might not last long due to domestic and external risks – MUFG
Aussie Down as China Unrest Triggers Risk Aversion
The key technical levels in play before the US jobs report

Leave a Reply

Your email address will not be published. Required fields are marked *