What Investors Should Know about Charter’s 2018 Capex Budget



Charter Communications’ capital expenditure

Charter Communications (CHTR) has been consistently investing in capital expenditures (or capex) to improve its network. Charter Communications’ management anticipates its capital expenditures to ramp up in 2018.

Charter Communications restarted its all-digital projects in the remaining Bright House and Time Warner Cable markets that are not yet all-digital. It also implemented the deployment of 1 Gbps speeds via DOCSIS 3.1 technology across its footprint.

In 4Q17, Charter Communications (CHTR) spent $2.6 billion on capital expenditures, including $202.0 million on transition-related expenses. However, the telecom company spent just under $1.9 billion on capital expenditures in 4Q16, including $187.0 million on transition-related expenses.

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According to the company, this growth in capital expenditures has been mostly due to higher spending on CPE (customer-premise equipment), scalable infrastructure, and support capital. The higher spending on CPE is due to the launch of Spectrum pricing and packaging in legacy Time Warner Cable and Bright House markets.

Expected capital expenditures in 2018

Charter Communications’ (CHTR) management hasn’t provided any capital expenditures guidance range for fiscal 2018. Frontier Communications (FTR) anticipates capital expenditures to come in at an ~$1.0 billion–$1.2 billion guidance range in fiscal 2018. Windstream (WIN) is expected to spend ~$0.80 billion on capital expenditures in 2018.

AT&T (T) and Verizon (VZ), the integrated US telecom companies, expect to spend ~$25.0 billion and ~$17.8 billion, respectively, on capital expenditures during the same period.


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