Charter Communications, Inc.

Hello, and welcome to Charter Communications' fourth quarter 2022 investor call. We ask that you please hold all questions until the completion of the formal remarks, at which time you will be given instructions for the question and answer session. Also, as a reminder, this conference is being recorded today. If you have any objections, please disconnect at this time. I will now turn the call over to Stephan Anninger. Sir, please begin.

Good morning, and welcome to Charter's fourth quarter 2022 investor call. The presentation that accompanies this call can be found on our website, ir.charter.com, under the financial information section. Before we proceed, I would like to remind you that there are a number of risk factors and other cautionary statements contained in our SEC filings, including our most recent 10-K file this morning. We will not review those risk factors and other cautionary statements on this call. However, we encourage you to read them carefully. Various remarks that we make on this call concerning expectations, predictions, plans, and prospects constitute forward-looking statements. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ from historical or anticipated results. Any forward-looking statements reflect management's current view only, and Charter undertakes no obligation to revise or update such statements or to make additional forward-looking statements in the future. During the course of today's call, we will be referring to non-GAAP measures as defined and reconciled in our earnings materials. These non-GAAP measures, as defined by Charter, may not be comparable to measures with similar titles used by other companies. Please also note that all growth rates noted on this call and in the presentation are calculated on a year-over-year basis unless otherwise specified. On today's call, we have Chris Winfrey, our CEO, Tom Rutledge, our Executive Chairman, and Jessica Fisher. our CFO. With that, let's turn the call over to Chris.

Thanks, Stephan. We continue to execute well within a challenging market backdrop in 2022. We remain excited about the industry's future and charters in particular. We added over 340,000 internet customers in 2022, despite the previous pandemic full force and a low activity environment. We also continued to see very strong mobile line growth, with full-year line and net additions of over 1.7 million. As of the end of 2022, we had 5.3 million total mobile lines. So we're growing mobile lines fast, even in a low-volume environment, by saving customers hundreds and often thousands of dollars per year. That growth creates value for Charter and supports broadband growth. For the full year, we grew our consolidated revenue by 4.5% and our adjusted EBITDA by close to 5%. The planned December management transition with Tom moving to executive chairman is also going very well. I'm pleased Tom will join us in today's Q&A. In 2023, in the coming years, we remain primarily focused on three broadband initiatives, evolution, expansion, and execution. Each of these initiatives is designed to drive customer growth and long-term cash flow growth. Starting with evolution, already in 2023 and over the next three years, we will evolve our network to ubiquitously offer symmetrical and multi-gigabit speeds. We'll deploy these new speed offerings at a much faster pace and at a much cheaper cost than our competitors, just $100 per passing. And we'll maintain our marketing speed claims. We're also evolving our go-to-market approach with increasing convergence. We recently launched Spectrum One, which combines our internet, advanced Wi-Fi, and mobile products for the fastest, seamless connectivity. During the fourth quarter, we saw continued sell-in of mobile to our large Internet base, and our Spectrum One converged offering helped drive our strongest quarter yet for mobile lines. The potential for mobile to be a significant driver of new Internet sales is still largely untapped as we educate non-subscribers of the Spectrum One value proposition. With nearly 5.3 million lines created over a four-year period, it is clear that our converged customers have meaningfully lower Internet and customer relationship churns. And while some of that churn benefit may be self-selection, mobile drives better churn and ultimately acquisition for charter. Our second area of focus is the expansion of our footprint. Line extension construction is an important part of our 2023 growth plan and beyond and offers good growth and returns visibility. We hope to complete our RDOF build ahead of the original commitment and that faster completion is good for our returns, the communities where we build obviously, and it creates credibility for future subsidized builds and option value for future growth. As we also mentioned in December, we've been successful in winning a number of other state and local grants in 2022 and expect the same in 2023. And we expect, assuming a reasonable regulatory framework, to participate in the $42.5 billion BEAT program. The initial results of our rural construction initiative have been very promising. We constructed over 200,000 new rural passings in 2022, and penetration of passings open at least six months is ahead of our expectations at about 40%. Over time, we expect our rural construction initiative to be a significant contributor to our customer growth with attractive mid- to high-teen internal rates of return. And finally, we remain focused on executing on our core operating strategy, all to further improve the customer experience, raise customer satisfaction, and drive customer growth. We're doing that in a number of ways, including the continued digitization of our customer service model in ways that enhance the customer experience, accelerating our proactive maintenance initiative to address service issues before customers even see an impairment, and investing in training and tenure for our employees to continue to improve our service and sales capabilities. Longer tenure leads to better execution with higher sales, lower service transactions, lower churn, and more products per customer over time. So we have a large growth opportunity in front of us through network evolution, convergence, and continued operational execution, and a very unique opportunity to expand our footprint. We have a successful operating model to address the opportunities in front of us. It's the same strategy that we've deployed for years. It's about having the fastest connectivity and products and pricing and packaging that's difficult for customers to replicate, and putting that all together so that we provide more product into the household, more penetration across our passings, and then marrying that with high-quality service with fewer service transactions and lower churn. That all drives higher long-term recurring cash flow. You then take that sustainable cash flow model and put it together with an innovative capital structure and a disciplined approach to ROI-driven capital allocation between organic investment, expansion, and or M&A, and buybacks, and you get Charter. So we have a great path in front of us to deliver long-term shareholder value creation, which means delivering for our customers, employees, and local communities. With that, I'll turn the call over to Jessica.