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What changed in Charter Communications's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Charter Communications's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+346 added−341 removedSource: 10-K (2024-02-02) vs 10-K (2023-01-27)

Top changes in Charter Communications's 2023 10-K

346 paragraphs added · 341 removed · 280 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

137 edited+35 added−27 removed74 unchanged
Biggest changeIn the event of an information security breach, such rules may require consumer and government agency notification and may result in regulatory enforcement actions with the potential of monetary forfeitures. The FCC, the FTC and state attorneys general regularly bring enforcement actions against companies related to information security breaches and privacy violations.
Biggest changeAll states have data breach notification laws that would require us to inform individuals and regulators in the event of a breach that could impact personal information of our customers. In the event of an information security breach, such rules may require consumer and government agency notification and may result in regulatory enforcement actions with the potential of monetary forfeitures.
Total customer relationships exclude enterprise and mobile-only customer relationships. (c) Monthly residential revenue per residential customer is calculated as total residential annual revenue divided by twelve divided by average residential customer relationships during the respective year and excludes mobile revenue and customers.
Total customer relationships exclude enterprise and mobile-only customer relationships. (c) Monthly residential revenue per residential customer is calculated as total residential annual revenue divided by twelve divided by average residential customer relationships during the respective year and excludes mobile-only customers.
With ACW, tenants will receive the same visibility and control over their apartment’s WiFi networks through the My Spectrum App, while building managers will be able to see and manage the entire building’s network through a purpose-built property service portal.
With ACW, tenants receive the same visibility and control over their apartment’s WiFi networks through the My Spectrum App, while building managers will be able to see and manage the entire building’s network through a purpose-built property service portal.
In addition, for 7 industries such as hospitality, education and healthcare where specialized video solutions are demanded, Spectrum Enterprise offers a wide range of solutions designed to meet those requirements. Spectrum Enterprise serves businesses nationally by combining its large serviceable footprint with a robust portfolio of fiber lit buildings and a significant wholesale partner network.
In addition, for industries such as hospitality, education and healthcare where specialized video solutions are demanded, Spectrum Enterprise offers a wide range of solutions designed to meet those requirements. Spectrum Enterprise serves businesses nationally by combining its large serviceable footprint with a robust portfolio of fiber lit buildings and a significant wholesale partner network.
(b) Customer relationships include the number of customers that receive one or more levels of service, encompassing Internet, video and voice services, without regard to which service(s) such customers receive. Customers who reside in residential multiple dwelling units (“MDUs”) and that are billed under bulk contracts are counted based on the number of billed units within each bulk MDU.
(b) Customer relationships include the number of customers that receive one or more levels of service, encompassing Internet, video, voice and mobile services, without regard to which service(s) such customers receive. Customers who reside in residential multiple dwelling units (“MDUs”) and that are billed under bulk contracts are counted based on the number of billed units within each bulk MDU.
In 2019, the FCC 14 clarified that the value of in-kind contribution requirements set forth in cable franchises is subject to the statutory cap on franchise fees, and it reaffirmed that state and local authorities are barred from imposing franchise fees on revenues derived from non-cable services, such as Internet services, provided by cable operators over cable systems.
In 2019, the FCC clarified that the value of in-kind contribution requirements set forth in cable franchises is subject to the statutory cap on franchise fees, and it reaffirmed that state and local authorities are barred from imposing franchise fees on revenues derived from non-cable services, such as Internet services, provided by cable operators over cable systems.
There are several ways in which we attract, develop, and retain highly qualified talent, including: Pay and Benefits • We provide compensation packages that are market competitive, taking into account the location and responsibilities of the role. • All hourly employees have a starting minimum wage of at least $20 per hour, which is well above any state or federal minimum wage level. • Nearly 85% of our employees are eligible for additional variable compensation based on their performance (e.g., annual performance bonus or sales commission). • We offer enhanced career progression opportunities, including annual bonus eligibility for all frontline supervisors and other salaried employees not already on a commission or bonus plan. • We provide high-quality, comprehensive medical, dental, and vision coverage for all full-time and part-time employees.
There are several ways in which we attract, develop, and retain highly qualified talent, including: Pay and Benefits • We provide compensation packages that are market competitive, taking into account the location and responsibilities of the role. • All hourly employees have a starting minimum wage of at least $20 per hour, which is well above any state or federal minimum wage level. • Nearly 85% of our employees are eligible for additional variable compensation based on their performance, including annual bonus eligibility for all frontline supervisors and other salaried employees not already on a sales commission or bonus plan. • We offer enhanced career progression opportunities. • We provide high-quality, comprehensive medical, dental, and vision coverage for all full-time and part-time employees.
The federally regulated rates now applicable to pole attachments used for cable or telecommunications services, including when offered together with Internet service, are substantially similar. The FCC's approach does not directly affect the rate in states that self-regulate, but many of those states have substantially the same rate for all communications attachments.
The federally regulated rates applicable to pole attachments used for cable or telecommunications services, including when offered together with Internet service, are substantially similar. The FCC's approach does not directly affect the rate in states that self-regulate, but many of those states have substantially the same rate for all communications attachments.
All broadband providers are also obliged by CALEA to configure their networks in a manner that facilitates the ability of state and federal law enforcement, with proper legal process authorized under the Electronic Communications Privacy Act, to obtain records and information concerning our customers, including the content of their communications.
All broadband providers are also obliged by CALEA to configure their networks in a manner that facilitates the ability of state and federal law enforcement, with proper legal process authorized under the Electronic Communications Privacy Act, to wiretap and obtain records and information concerning our customers, including the content of their communications.
(d) Monthly SMB revenue per SMB customer is calculated as total SMB annual revenue divided by twelve divided by average SMB customer relationships during the respective year and excludes mobile revenue and customers. 5 (e) Mobile lines include phones and tablets which require one of our standard rate plans (e.g., "Unlimited" or "By the Gig").
(d) Monthly SMB revenue per SMB customer is calculated as total SMB annual revenue divided by twelve divided by average SMB customer relationships during the respective year and excludes mobile-only customers. 5 (e) Mobile lines include phones and tablets which require one of our standard rate plans (e.g., "Unlimited" or "By the Gig").
Media corporation and broadcast station group consolidation has, however, resulted in fewer suppliers and additional selling power on the part of programming suppliers. Programming is usually made available to us for a license fee, which is generally paid based on the number of customers to whom we make that programming available.
Media corporation and broadcast station group consolidation has, however, resulted in fewer suppliers and additional selling power on the part of programming suppliers. 11 Programming is usually made available to us for a license fee, which is generally paid based on the number of customers to whom we make that programming available.
Our residential video service also faces growing competition across our footprint from a number of other sources, including companies that deliver linear network programming, movies and television shows on demand and other video content over broadband Internet connections to televisions, computers, tablets and mobile devices.
Video Competition Our residential video service faces growing competition across our footprint from a number of other sources, including companies that deliver linear network programming, movies and television shows on demand and other video content over broadband Internet connections to televisions, computers, tablets and mobile devices.
The FTC currently has the authority, pursuant to its general authority to enforce against unfair or deceptive acts and practices, to protect the privacy of Internet service customers, including our use and disclosure of certain customer information. 16 Our operations are also subject to federal and state laws governing information security.
The FTC currently has the authority, pursuant to its general authority to enforce against unfair or deceptive acts and practices, to protect the privacy of Internet service customers, including our use and disclosure of certain customer information. Our operations are also subject to federal and state laws governing information security.
Regional and local field operations are responsible for customer premise service transactions and maintaining and constructing that portion of our network which is located outdoors. Our field operations 10 strategy includes completing a significant portion of our activity with our employees which we find drives consistent and higher quality services.
Regional and local field operations are responsible for customer premise service transactions and maintaining and constructing that portion of our network which is located outdoors. Our field operations strategy includes completing a significant portion of our activity with our employees which we find drives consistent and higher quality services.
Our Network Technology Our network includes three key components: a national backbone, regional/metro networks and a “last-mile” network. Both our national backbone and regional/metro network components utilize a redundant IP ring/mesh fiber architecture. The national backbone component provides connectivity from regional demarcation points to nationally centralized content, connectivity and services.
Our Network Technology Our network includes three key components: a national backbone, regional/metro networks and a “last-mile” network. Both our national backbone and regional/metro network components utilize a redundant IP ring/mesh fiber architecture. The national 9 backbone component provides connectivity from regional demarcation points to nationally centralized content, connectivity and services.
We also compete for retail activations with other resellers that buy bulk wholesale service from wireless service providers for resale. 12 Regional Competitors In some of our operating areas, other competitors have built networks that offer Internet, video and voice services that compete with our services.
We also compete for retail activations with other resellers that buy bulk wholesale service from wireless service providers for resale. Regional Competitors In some of our operating areas, other competitors have built networks that offer Internet, video and voice services that compete with our services.
Wireline Voice Service The FCC has never classified the VoIP wireline telephone services we offer as “telecommunications services” that are subject to traditional federal common carrier regulation, but instead has imposed some of these regulatory requirements on a case-by-case basis, such as requirements relating to 911 emergency services (“E911”), Communications Assistance for Law Enforcement Act (“CALEA”) (the statute governing law enforcement access to and surveillance of communications), Universal Service Fund contributions, customer privacy and Customer Proprietary Network Information protections, number portability, network outage reporting, rural call completion, disability access, regulatory fees, back-up power, robocall mitigation and discontinuance of service.
Wireline Voice Service The FCC has never classified the VoIP wireline telephone services we offer as “telecommunications services” that are subject to traditional federal common carrier regulation, but instead has imposed some of these regulatory requirements on a case-by-case basis, such as requirements relating to 911 emergency services (“E911”), Communications Assistance for Law 16 Enforcement Act (“CALEA”) (the statute governing law enforcement access to and surveillance of communications), Universal Service Fund contributions, customer privacy and Customer Proprietary Network Information (“CPNI”) protections, number portability, network and/or 911 outage reporting, rural call completion, disability access, regulatory fees, back-up power, robocall mitigation and discontinuance of service.
Financial Statements and Supplementary Data,” which also includes the accreted values of the indebtedness described below. 3 Footprint We operate in geographically diverse areas which are managed centrally on a consolidated level. The map below highlights our footprint along with our planned rural expansion over the next several years based on grants awarded as of December 31, 2022.
Financial Statements and Supplementary Data,” which also includes the accreted values of the indebtedness described below. 3 Footprint We operate in geographically diverse areas which are managed centrally on a consolidated level. The map below highlights our footprint along with our planned rural expansion over the next several years based on grants awarded as of December 31, 2023.
We expect these newly-served homes will be enabled to engage in distance learning, remote work, telemedicine and other bandwidth-heavy applications that require high speed broadband connectivity. Newly-served rural areas will also benefit from our high-value SPP structure including our voice and mobile offerings, as well as our comprehensive selection of video products.
We expect these newly-served homes will be enabled to engage in remote work, virtual learning, telemedicine and other bandwidth-heavy applications that require high speed broadband connectivity. Newly-served rural areas will also benefit from our high-value SPP structure including our voice and mobile offerings, as well as our comprehensive selection of video products.
Our design standard allows spare fiber strands to each node to be utilized for additional residential traffic capacity, and enterprise customer needs as they arise. For our Spectrum Enterprise customers, fiber optic cable is extended to the customer’s site. For certain new buildouts, including for our rural construction initiative, and MDU sites, we utilize a fiber deployment.
Our design standard allows spare fiber strands to each node to be utilized for additional residential traffic capacity, and enterprise customer needs as they arise. For our Spectrum Enterprise customers, fiber optic cable is extended to the customer’s site. For most new buildouts, including for our rural construction initiative, and MDU sites, we utilize a fiber deployment.
Bundled services including some combination of our Internet, video, voice and/or mobile products are available to substantially all of our passings. 4 The following table summarizes our customer statistics for Internet, video, voice and mobile as of December 31, 2022 and 2021 (in thousands except per customer data and footnotes).
Bundled services, including some combination of our Internet, video, voice and/or mobile products are available to substantially all of our passings. 4 The following table summarizes our customer statistics for Internet, video, voice and mobile as of December 31, 2023 and 2022 (in thousands except per customer data and footnotes).
With Advanced WiFi, customers enjoy a cloud-optimized WiFi connection and have the ability to view and control their WiFi network through our Spectrum application (“My Spectrum App”). The service enables parental control schedules to be set for children’s devices or limit access entirely to unknown devices attempting to access the network.
With Advanced WiFi, customers enjoy a cloud-optimized WiFi connection and have the ability to view and control their WiFi network through our Spectrum app (“My Spectrum App”). The service enables parental control schedules to be set for children’s devices or to limit access entirely to unknown devices attempting to access the network.
We also have specialized offerings to enhance affordability of our Internet product for qualified low-income households, including Spectrum Internet Assist, a 30 megabits per second ("Mbps") service, and Internet 100, a 100 Mbps service. Both are low cost and include a modem for no additional charge.
We also have specialized offerings to enhance affordability of our Internet product for qualified low-income households, including Spectrum Internet Assist, a 50 megabits per second ("Mbps") service, and Internet 100, a 100 Mbps service. Both are low cost and include a modem for no additional charge.
The equity ownership percentages shown below for Charter Communications Holdings, LLC (“Charter Holdings”) are approximations. Indebtedness amounts shown below are principal amounts as of December 31, 2022. See Note 8 to the accompanying consolidated financial statements contained in “Part II. Item 8.
The equity ownership percentages shown below for Charter Communications Holdings, LLC (“Charter Holdings”) are approximations. Indebtedness amounts shown below are principal amounts as of December 31, 2023. See Note 8 to the accompanying consolidated financial statements contained in “Part II. Item 8.
These investments will allow us to generate long-term infrastructure-style returns by taking further advantage of the efficiencies of the scale and quality of our network and construction capabilities while offering our high quality products and services to more homes and businesses.
These investments will allow us to generate long-term infrastructure-style returns by further taking advantage of our scale efficiencies, network quality and construction capabilities, while offering 10 our high quality products and services to more homes and businesses.
We elected to participate in the EBBP and ACP, and the FCC regulates many of the terms on which we provide ACP services, including restrictions on our ability to refuse service to prospective eligible customers based upon their credit or payment history.
We elected to participate in the EBB and ACP, and the FCC regulates many of the terms on which we provide ACP services, including restrictions on our ability to refuse service to prospective eligible customers based upon their credit or payment history.
As part of our investment in operations teams, we are making targeted adjustments to job structure, pay and benefits and career paths to improve the skills and tenure of our workforce. 1 Our principal executive offices are located at 400 Washington Blvd., Stamford, Connecticut 06902. Our telephone number is (203) 905-7801, and we have a website accessible at ir.charter.com.
As part of our investment in operations teams, we have made targeted adjustments to job structure, pay and benefits and career paths to improve the skills and tenure of our workforce. Our principal executive offices are located at 400 Washington Blvd., Stamford, Connecticut 06902. Our telephone number is (203) 905-7801, and we have a website accessible at ir.charter.com.
It is our priority to keep this coverage affordable for our employees and their families, and so for the last ten years, we have absorbed the full premium cost increase for medical, dental, and vision coverage. • We provide competitive financial benefits to all employees such as a 401(k) retirement plan with a dollar for dollar company match up to 6% of their eligible pay.
It is our priority to keep this coverage affordable for our employees and their families, and so for the last eleven years, we have absorbed the full premium cost increase for medical, dental, and vision coverage. • We provide competitive financial benefits to all employees such as a 401(k) Plan with a dollar for dollar company match up to 6% of their eligible pay.
We sell our residential and commercial services using national brand platforms known as Spectrum, Spectrum Business, Spectrum Enterprise and Spectrum Reach. These brands reflect our comprehensive approach to industry-leading products, driven by speed, performance and innovation.
We sell our residential and commercial services using national brand platforms known as Spectrum, Spectrum Business, Spectrum Enterprise, Spectrum Reach and Spectrum Community Solutions. These brands reflect our comprehensive approach to industry-leading products, driven by speed, performance and innovation.
With the funding for EBBP set to run out, Congress in the IIJA authorized $14.2 billion for the successor ACP that provides up to a $30 monthly discount for most eligible customers paid to the household’s broadband provider.
With the funding for EBB set to run out, Congress in the IIJA authorized $14.2 billion for the successor ACP that provides up to a $30 monthly discount for most eligible customers paid to the household’s broadband provider.
Offering high quality, competitively priced products and outstanding service allows us to increase both the number of customers we serve over our fully deployed network and the number of products we sell to each customer.
Offering high quality, competitively priced products and outstanding service allows us to increase both the number of customers we serve over our network and the number of products we sell to each customer.
We monitor the effectiveness of our marketing efforts, customer perception, competition, pricing, and service preferences, among other factors, in order to increase our responsiveness to our customers and to improve our sales and customer retention. The marketing organization manages all residential and SMB sales channels including inbound, direct sales, on-line, outbound telemarketing and stores.
We monitor the effectiveness of our marketing efforts, customer perception, competition, pricing, and service preferences, among other factors, in order to increase our responsiveness to our customers and to improve our sales and customer retention. The marketing organization manages all residential and SMB sales channels including inbound, direct sales, online, outbound telemarketing and stores.
We have been awarded over $1.7 billion in the RDOF auction and other federal, state and municipal grants that will partially fund, along with our substantial additional investment, the construction of new broadband infrastructure to more than one million estimated passings.
We have been awarded over $2 billion in the RDOF auction and other federal, state and municipal grants that will partially fund, along with our substantial additional investment, the construction of new broadband infrastructure to more than one million estimated passings.
It allows us to maintain a state-of-the-art network delivering the most compelling converged connectivity services in a capital and time-efficient manner, and in turn, offer advanced services to consumers at highly attractive prices, together with outstanding customer service.
This strategy allows us to maintain a state-of-the-art network delivering the most compelling converged connectivity services in a capital and time-efficient manner, and in turn, offer advanced services to consumers at highly attractive prices, together with outstanding customer service.
Call Guard reduces customer frustration and improves security by blocking malicious calls while ensuring our customers continue to receive the legitimate automated calls they need from schools or healthcare providers. 6 Video Services We provide our customers with a choice of video programming services on a variety of platforms including through a digital set-top box or an Internet Protocol ("IP") device.
Call Guard reduces customer frustration and improves security by blocking malicious calls while ensuring our customers continue to receive the legitimate automated calls they need from schools or healthcare providers. 6 Video Services We provide our customers with a choice of video programming services on a variety of platforms including through a digital Spectrum Receiver or an Internet Protocol ("IP") device.
In 2021, pursuant to Congressional 15 appropriation for COVID relief, the FCC established a temporary monthly Emergency Broadband Benefit Program ("EBBP") subsidy of up to $50 for most eligible low-income households.
In 2021, pursuant to Congressional appropriation for COVID relief, the FCC established a temporary monthly Emergency Broadband Benefit Program ("EBB") subsidy of up to $50 for most eligible low-income households.
Spectrum Internet bundled with our in-home Advanced WiFi allows multiple people within a single household to stream high definition (“HD”) video content while simultaneously using our Internet service for other purposes including two-way video conferencing, among other things.
Spectrum Internet bundled with our in-home Advanced WiFi allows multiple people within a single household to stream high definition (“HD”) video content while simultaneously using our Internet service for other purposes including two-way video conferencing, gaming and virtual reality, among other things.
In October 2022, we introduced Spectrum One, which brings together in a high-value package, Spectrum Internet, Advanced WiFi and Unlimited Spectrum Mobile, offering consumers fast, reliable and secure online connections on their favorite devices at home and on-the-go. Alternatively, our mobile customers can choose one of two simple ways to pay for data.
Our Spectrum One offering, which brings together Spectrum Internet, Advanced WiFi and Unlimited Spectrum Mobile, offers consumers fast, reliable and secure online connections on their favorite devices at home and on-the-go in a high-value package. Alternatively, our mobile customers can choose one of two simple ways to pay for data.
These 5G small cells, combined with growing WiFi capabilities, increase speed and reliability along with improving our cost structure through offload onto our owned networks.
These 5G small cells, combined with growing WiFi capabilities, increase speed and reliability along with improving our cost structure through offload of wireless data onto our owned networks.
Item 1. Business. Introduction We are a leading broadband connectivity company and cable operator serving more than 32 million customers in 41 states through our Spectrum brand. Over an advanced high-capacity, two-way telecommunications network, we offer a full range of state-of-the-art residential and business services including Spectrum Internet ® , TV, Mobile and Voice.
Item 1. Business. Introduction We are a leading broadband connectivity company and cable operator serving more than 32 million customers in 41 states through our Spectrum brand. Over an advanced communications network, we offer a full range of state-of-the-art residential and business services including Spectrum Internet ® , TV, Mobile and Voice.
Our results are impacted by the seasonal nature of customers receiving our cable services in college and vacation service areas. Our revenue is subject to cyclical advertising patterns and changes in viewership levels.
Seasonality and Cyclicality Our business is subject to seasonal and cyclical variations. Our results are impacted by the seasonal nature of customers receiving our cable services in college and vacation service areas. Our revenue is subject to cyclical advertising patterns and changes in viewership levels.
This bandwidth-rich network enables us to offer a large selection of HD channels and Spectrum Internet Gig across all of our footprint which enables us to provide fast, reliable and secure online connections and meet nearly all current residential customer demands today.
This bandwidth-rich network enables us to offer a large selection of HD channels and Spectrum Internet Gig across all of our footprint which enables us to provide fast, reliable and secure online connections, meeting current customer demands.
Mobile Competition Our mobile service faces competition from national mobile network operators including AT&T, Verizon and T-Mobile US, Inc. ("T-Mobile"), fixed wireless providers, as well as a variety of regional operators and mobile virtual network operators. Most carriers offer unlimited data packages to customers while some also offer free devices.
Mobile Competition Our mobile service faces competition from national mobile network operators including AT&T, Verizon and T-Mobile US, Inc. ("T-Mobile"), as well as a variety of regional operators and mobile virtual network operators. Most carriers offer unlimited data packages to customers while some also offer free or highly discounted devices.
Our in-home WiFi product provides our Internet customers with high performance wireless routers and a managed WiFi service to maximize their wireless Internet experience. We offer Advanced WiFi service across nearly all of our residential footprint along with WiFi 6 routers capable of delivering speeds over 1 Gbps.
Our in-home WiFi product provides our Internet customers with high performance wireless routers and a managed WiFi service to maximize their wireless Internet experience. We offer Advanced WiFi service across all of our footprint along with WiFi 6E routers capable of delivering speeds over 2 Gbps.
Bad debt expense associated with these past due accounts has been reflected in our consolidated statements of operations. The increase in past due accounts is predominately due to pre-existing and incremental unsubsidized services, including video services, for those customers participating in government assistance programs. These customers are downgraded to a fully subsidized Internet-only service.
Bad debt expense associated with these past due accounts has been reflected in our consolidated statements of operations. The increase in accounts past due more than 120 days is predominately due to pre-existing and incremental unsubsidized amounts of customers’ bills for those customers participating in government assistance programs, including video services. These customers are downgraded to a subsidized Internet-only service.
Several competitors, including AT&T, Frontier, Verizon, 11 WideOpenWest, Inc. ("WOW") and Google Fiber, deliver 1 Gbps broadband speed (and some deliver multi Gbps) in at least a portion of their footprints which overlap our footprint. Additionally, several national mobile network operators offer Long Term Evolution (“LTE”) or 5G delivered fixed wireless home Internet service in our markets.
("WOW") and Google Fiber, deliver 1 Gbps broadband speed (and some deliver multi Gbps) in at least a portion of their footprints which overlap our footprint. Additionally, several national mobile network operators offer long-term evolution (“LTE”) or 5G delivered fixed wireless home Internet service in our markets.
State regulatory commissions and legislatures may continue to consider imposing regulatory requirements on our fixed telephone services. Mobile Service Our Spectrum Mobile service offers mobile Internet access and telephone service. We provide this service as an MVNO using Verizon’s network and our network through Spectrum WiFi.
State regulatory commissions and legislatures may continue to consider imposing regulatory requirements on our fixed wireline voice telephone services. Mobile Service Our Spectrum Mobile service offers mobile Internet access and telephone service. We provide this service as a mobile virtual network operator ("MVNO") using Verizon’s network and our network through Spectrum WiFi.
This network evolution will also allow us to extend fiber services to the home in a success based “Fiber on Demand” manner and is the technology currently deployed in our rural fiber buildouts. We plan to complement our wireline investments with planned WiFi upgrades for in-home routers.
This network evolution will also allow us to extend fiber services to the home in a success based “Fiber on Demand” manner. We plan to complement our wireline investments with planned WiFi upgrades for in-home routers.
Other online video business models and products have also developed, some offered by programmers that have not traditionally sold programming directly to consumers, including, (i) subscription video on demand (“SVOD”) services such as Netflix, Apple TV+, Amazon Prime, Hulu Plus, Disney+, HBO Max, Peacock, Paramount+, AMC+, Starz and Showtime Anytime, (ii) ad-supported free online video products, including YouTube and Pluto TV, some of which offer programming for free to consumers that we currently purchase for a fee, (iii) pay-per-view products, such as iTunes, and (iv) additional offerings from mobile providers which continue to integrate and bundle video services and mobile products.
Other online video business models and products have also developed, some offered by programmers, including, (i) subscription video on demand (“SVOD”) services such as Netflix, Apple TV+, Amazon Prime and Hulu Plus, (ii) programmer DTC applications such as Disney+, Peacock and Paramount+, (iii) ad-supported free online video products, including YouTube and Pluto TV, some of which offer programming for free to consumers that we currently purchase for a fee, (iv) pay-per-view products, such as iTunes, and (v) additional offerings from mobile providers which continue to integrate and bundle video services and mobile products.
We own 210 Citizen Broadband Radio Service ("CBRS") Priority Access Licenses ("PALs") and intend to use these licenses along with unlicensed CBRS spectrum to build our own 5G data-only mobile network on targeted 5G small cell sites leveraging our HFC network to provide power and data connectivity to the majority of the sites.
We intend to use these licenses along with unlicensed CBRS spectrum to build our own 5G data-only mobile network on targeted 5G small cell sites leveraging our HFC network to provide power and data connectivity to the majority of the sites.
We believe that this hybrid network design provides high capacity and signal quality with a cost efficient path to increased speeds. 9 HFC architecture benefits include: • bandwidth capacity to enable traditional and two-way video and broadband services; • dedicated bandwidth for delivering two-way services, signal quality and higher service reliability, which provides an advantage over fixed wireless offerings; • the ability to upgrade capacity at a lower incremental capital cost relative to our competitors; and • a powered network enabling Advanced WiFi out-of-home and our future 5G small cell access points.
HFC architecture benefits include: • bandwidth capacity to enable traditional and two-way video and broadband services; • dedicated bandwidth for delivering two-way services, signal quality and higher service reliability, which provides an advantage over fixed wireless offerings; • the ability to upgrade capacity at a lower incremental capital cost relative to our competitors; and • a powered network enabling out-of-home Advanced WiFi and 5G small cell access points.
Advertising competition has increased and will likely continue to increase as new advertising platforms seek to attract the same advertisers. We compete for advertising revenue against, among others, local broadcast stations, national cable and broadcast networks, radio stations, print media and online advertising companies and content providers. Seasonality and Cyclicality Our business is subject to seasonal and cyclical variations.
Advertising competition has increased and will likely continue to increase as new advertising platforms seek to attract the same advertisers. We compete for advertising revenue against, among others, local broadcast stations, national cable and broadcast networks, radio stations, print media, connected device platforms and online advertising companies and content providers.
Rural Construction Initiative In 2022, we continued our rural broadband construction initiative in which we intend to expand our network to offer a suite of broadband connectivity services including fixed Internet, WiFi and mobile to more than one million estimated passings in unserved areas in states where we currently operate.
Subsidized Rural Construction Initiative In 2023, we continued our subsidized rural construction initiative in which we intend to expand our network to offer a suite of broadband connectivity services, including fixed Internet, WiFi and mobile to over 1.6 million passings in unserved areas in states where we currently operate.
Through this process, which we expect to essentially complete by year end 2025, we will transform our network to enable multi-gigabit data speeds to customers. Those faster speeds will be offered in conjunction with our Spectrum mobile product and Advanced WiFi, providing customers seamless and convenient, ultra-fast converged connectivity in attractively priced packages, including Spectrum One, introduced in October 2022.
Through this process, which we expect to complete in 2026, we will transform our network to enable multi-gigabit data speeds to customers. Those faster speeds will be offered in conjunction with our Spectrum Mobile product and Advanced WiFi, providing customers seamless and convenient, ultra-fast converged connectivity in attractively priced packages, such as our Spectrum One offer.
Our services are offered to residential and commercial customers on a subscription basis, with prices and related charges based on the types of service selected, whether the services are sold as a “bundle” or on an individual basis, and based on the equipment necessary to receive our services.
Products and Services We offer our customers subscription-based Internet services, video services, and mobile and voice services, with prices and related charges based on the types of service selected, whether the services are sold as a “bundle” or on an individual basis, and based on the equipment necessary to receive our services.
Programming We believe that offering a wide variety of video programming choices influences a customer’s decision to subscribe to and retain our cable video services. We obtain basic and premium programming, usually pursuant to written contracts from a number of suppliers.
Programming We believe that offering a wide variety of video programming choices influences a customer’s decision to subscribe to and retain our video and Internet services. We obtain basic and premium programming, usually pursuant to written contracts from a number of suppliers. We are also beginning to obtain access to the related DTC services pursuant to those contracts.
In recent years, the federal, state and local governments have offered billions of dollars in subsidies to companies deploying broadband to areas deemed to be “unserved” or “underserved,” using funds from the FCC’s RDOF auction in 2020, The American Rescue Plan Act of 2021 (“ARPA”), and The Infrastructure Investment and Jobs Act of 2021 (the “IIJA”).
The application of the proposed rules could adversely affect our business. In recent years, the federal, state and local governments have offered billions of dollars in subsidies to companies deploying broadband to areas deemed to be “unserved” or “underserved,” using funds from the FCC’s RDOF auction in 2020, The American Rescue Plan Act of 2021 (“ARPA”), and IIJA.
The market for our Internet services is affected by participation in and the general availability of programs that offer federal subsidies for certain low-income consumers for the purchase of Internet access service.
The FCC can also fine a provider for filing incorrect maps. The market for our Internet services is affected by participation in and the general availability of programs that offer federal subsidies for certain low-income consumers for the purchase of Internet access service.
In December 2022, we launched Spectrum Business Connect with RingCentral as our new SMB communications solution that includes Spectrum Internet, voice and complementary mobility features, and allows our customers’ remote and office employees to stay more easily connected regardless of their location.
Spectrum Business Connect with RingCentral is an SMB communications solution that includes Spectrum Internet, voice and complementary mobility features allowing our customers’ remote and office employees to stay more easily connected regardless of their location.
Our local news channels connect the diverse communities and neighborhoods we serve providing 24/7 hyperlocal content, focusing on news, programming and storytelling that addresses the deeper needs and interests of our customers.
Our local news channels connect the diverse communities and neighborhoods we serve providing 24/7 news, weather and community content focused on hyperlocal stories that address the deeper needs and interests of our customers.
Evolution – Expanding the Capability of Our Network Over the next three years, we plan to evolve our hybrid fiber coaxial network using a number of technologies, including spectrum expansion, initially to 1.2 GHz and then to 1.8 GHz, high splits to increase upstream speeds, Distributed Access Architecture ("DAA") and DOCSIS 4.0 technology.
We continue to evolve our hybrid fiber coaxial network using a number of technologies, including spectrum expansion, initially to 1.2 GHz and then to 1.8 GHz, changing the bandwidth allocation to a "high split" to increase upstream speeds, Distributed Access Architecture ("DAA") and DOCSIS 4.0 technology.
Customers are increasingly accessing their subscription video content through our highly rated Spectrum TV application via mobile devices and connected IP devices, such as Roku, Xumo TV and Samsung TV.
Customers are increasingly accessing their subscription video content through our highly rated Spectrum TV app via mobile devices and connected IP devices, such as Xumo, Roku and Samsung TV. Access to the Spectrum TV app is included in all Spectrum TV video plans.
These competitors include virtual multichannel video programming distributors (“vMVPDs”) such as Hulu Live, YouTube TV, Sling TV, Philo and DirecTV Stream.
These competitors include virtual MVPDs such as Hulu Live, YouTube TV, Sling TV, Philo and DirecTV Stream.
Over the next three years, we intend to deploy network enhancements to upgrade our footprint initially expanding our spectrum to 1.2 Ghz through a module upgrade in the hub, node and amplifier and using high splits to deliver multi-gig speed capabilities while using the current DOCSIS 3.1 customer premise equipment.
Through our network evolution initiative, we are currently expanding our spectrum to 1.2 Ghz through a module upgrade in the hub, node and amplifier and using high splits and DAA to deliver multi-gig speed capabilities while using the current DOCSIS 3.1 customer premise equipment.
In addition, a growing number of commercial areas, such as retail malls, restaurants and airports, offer WiFi Internet service. Numerous local governments are also considering or actively pursuing publicly subsidized WiFi Internet access networks. These options offer alternatives to cable-based Internet access.
In addition, commercial areas, such as retail malls, restaurants and airports, offer WiFi Internet service. Numerous local governments are also considering or actively pursuing publicly subsidized WiFi Internet access networks. In addition, providers are constructing open access networks that can deliver services from multiple underlying Internet service providers. These options offer alternatives to cable-based Internet access.
The CCPA, under certain circumstances, regulates companies’ use and disclosure of the personal information of California residents and authorizes enforcement actions by the California Attorney General and private class actions for data breaches.
For example, the California Consumer Privacy Act (“CCPA”) became effective on January 1, 2020. The CCPA, under certain circumstances, regulates companies’ use and disclosure of the personal information of California residents and authorizes enforcement actions by the California Attorney General and private class actions for data breaches.
On that basis, as of December 31, 2022 and 2021, customers include approximately 144,100 and 128,300 customers, respectively, whose accounts were over 60 days past due, approximately 52,800 and 26,800 customers, respectively, whose accounts were over 90 days past due, and approximately 214,100 and 43,200 customers, respectively, whose accounts were over 120 days past due.
On that basis, as of December 31, 2023 and 2022, customers include approximately 135,800 and 144,100 customers, respectively, whose accounts were over 60 days past due, approximately 54,700 and 52,800 customers, respectively, whose accounts were over 90 days past due, and approximately 286,000 and 214,100 customers, respectively, whose accounts were over 120 days past due.
Our in-house call centers handle nearly all of our total customer service calls. We manage our customer service call centers centrally to ensure a consistent, high quality customer experience.
As part of our operating strategy, we insource most of our customer operations workload. Our in-house call centers handle all of our customer service calls. We manage our customer service call centers centrally to ensure a consistent, high quality customer experience.
It is possible that Congress or the FCC will expand or modify its regulation of cable systems or the services delivered over cable systems and competing services in the future, and we cannot predict at this time how that might impact our business.
It is possible that Congress or the FCC will expand or modify its regulation of cable systems or the services delivered over cable systems and competing services in the future.
Historically, we have generally viewed SVOD online video services as complementary to our own video offering. As the proliferation of online video services grows, however, services from vMVPDs and direct to consumer offerings, as well as piracy and password sharing, negatively impact the number of customers purchasing our video product.
Historically, we have generally viewed SVOD online video services as complementary to our own video offering and, in the case of programmer DTC offerings, have begun to package the DTC services with the linear offerings. However, services from virtual MVPDs and DTC offerings, as well as piracy and password sharing, negatively impact the number of customers purchasing our video product.
With competitive wages, robust and affordable healthcare benefits, a generous retirement program with company match, and opportunities for job training and advancement, our employees develop skills and expertise necessary to build a long and successful career with us.
We believe that attracting, developing and retaining our highly-skilled workforce is critical to successfully executing our operating strategy. With competitive wages, robust and affordable healthcare benefits, a generous retirement program with company match, and opportunities for job training and advancement, our employees develop skills and expertise necessary to build a long and successful career with us.
We expect to invest over $6 billion over the next several years, a portion of which we expect to offset with government funding including over $1.7 billion of support awarded through December 31, 2022 in the RDOF auction and other federal, state and municipal grants, and we expect to participate in additional federal, state and municipal grant programs over the coming years.
Including amounts spent to date, we expect to invest over $8 billion in total over the next several years, a portion of which we expect to offset with government funding, including over $2 billion of support awarded through December 31, 2023 in the RDOF auction and other federal, state and municipal grants.
Voice Competition Our residential voice service competes with wireless and wireline phone providers across our footprint, as well as other forms of communication, such as text messaging on cellular phones, instant messaging, social networking services, video conferencing and email.
Our residential video service also faces competition from large telecommunications companies, primarily Verizon, which offer wireline video services in significant portions of our operating areas. 12 Voice Competition Our residential voice service competes with wireless and wireline phone providers across our footprint, as well as other forms of communication, such as text messaging on cellular phones, instant messaging, social networking services, video conferencing and email.
In addition, most of our employees are also eligible to receive an additional non-elective contribution equal to 3% of their eligible pay. • We have a stock incentive plan and grant equity awards to eligible employees on an annual basis.
In addition, most of our employees are also eligible to receive an additional non-elective contribution to a Retirement Accumulation Plan equal to 3% of their eligible pay. • We have a stock incentive plan and grant equity awards to eligible employees on an annual basis. 18 Training and Development • The substantial skills, experience and industry knowledge of our employees and our training of our customer-facing employees benefit our operations and performance.
We voluntarily follow NIST as part of our overall cybersecurity program. The FCC is considering expansion of its cybersecurity guidelines or the adoption of cybersecurity requirements. CISA is also developing cyber incident reporting rules, pursuant to 2022 legislative requirements, that require critical infrastructure entities to report substantial cyber incidents within 72 hours of their discovery.
The FCC is 17 considering expansion of its cybersecurity guidelines or the adoption of cybersecurity requirements. The Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency is also developing cyber incident reporting rules, pursuant to 2022 legislative requirements, that require critical infrastructure entities to report substantial cyber incidents within 72 hours of their discovery.
Later, we will continue to expand our spectrum to 1.2 Ghz but will use DAA to deliver even faster speeds when using the next generation of DOCSIS modem, DOCSIS 4.0. Next, we will begin to deploy DOCSIS 4.0 technology, to further increase our spectrum to 1.8 Ghz enabling even higher speed capabilities.
When paired with the next generation of DOCSIS modem, DOCSIS 4.0, we will be able to deliver even faster speeds. Next, we will begin to deploy DOCSIS 4.0 technology in the network, and further increase our spectrum to 1.8 Ghz enabling even higher speed capabilities.
We face terrestrial broadband Internet (defined as at least 25 Mbps) competition from three primary competitors, AT&T, Frontier and Verizon, in approximately 35%, 11% and 5% of our operating footprint, respectively. Video Competition Our residential video service faces competition from DBS service providers, which have a national footprint and compete in all of our operating areas.
We face terrestrial broadband Internet (defined as at least 25 Mbps) competition from three primary competitors, AT&T, Frontier and Verizon, in approximately 35%, 11% and 6% of our operating footprint, respectively.
In addition, we expect our network evolution to enable us to offer fiber on demand across the majority of our footprint.
In addition, we expect our network evolution to enable us to offer fiber on demand across the majority of our footprint. In October 2023, we began deploying Xumo Stream Boxes ("Xumo") to new video customers.
These new rules are scheduled to take effect six months after approval by the federal Office of Management and Budget. The 2017 FCC decision reclassifying Internet access services also ruled that state regulators may not impose obligations similar to federal network neutrality obligations that the FCC eliminated, but this blanket prohibition was vacated by the U.S.
These new rules are scheduled to become applicable to our services in April 2024. 15 The 2017 FCC decision reclassifying Internet access services also ruled that state regulators may not impose obligations similar to federal network neutrality obligations that the FCC eliminated, but this blanket prohibition was vacated by the U.S. Court of Appeals in 2019.
Over the next several years, we expect to invest over $6 billion, a portion of which we expect to offset with government funding including over $1.7 billion of support awarded through December 31, 2022 in the Rural Development Opportunity Fund (“RDOF”) auction and other federal, state and municipal grants.
Including amounts spent to date, we expect to invest over $8 billion in total in our subsidized rural construction initiative, a portion of which we expect to offset with government funding, including over $2 billion of support awarded through December 31, 2023 in the Rural Development Opportunity Fund (“RDOF”) auction and other federal, state and municipal grants.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese changes could include, for example, the reclassification of Internet services as regulated telecommunications services or other utility-style regulation of Internet services; restrictions on how we manage our Internet access services and networks; the adoption of new privacy restrictions on our collection, use and disclosure of certain customer information; new data security and cybersecurity mandates that could result in additional network and information security and cyber incident reporting requirements for our business; new restraints on our discretion over programming decisions; new restrictions on the rates we charge to consumers for one or more of the services or equipment options we offer; changes to the cable industry’s compulsory copyright license to carry broadcast signals; new requirements to assure the availability of navigation devices from third-party providers; new Universal Service Fund contribution obligations on our Internet service revenues that would add to the cost of that service; increases in government-administered broadband subsidies to rural areas that could result in subsidized overbuilding of our facilities; the exhaustion of funding for the FCC’s ACP or any changes to that program that could make it more difficult for us to provide services to low-income consumers; changes to the FCC’s administration of spectrum; pending court challenges to the legality of the FCC’s Universal Service programs, which, if successful, could adversely affect our receipt of universal service funds, including but not limited to FCC RDOF grants to expand our network, FCC E-rate funds to serve schools and libraries and FCC Rural Health Care funds to serve eligible health care providers; and changes in the regulatory framework for VoIP telephone service, including the scope of regulatory obligations associated with our VoIP telephone service and our ability to interconnect our VoIP telephone service with incumbent providers of traditional telecommunications service. 25 As a winning bidder in the FCC’s RDOF auction in 2020, we must comply with numerous FCC and state requirements to continue receiving such funding.
Biggest changeThese changes have in the past, and could in the future, include, for example, the reclassification of Internet services as regulated telecommunications services or other utility-style regulation of Internet services; restrictions on how we manage our Internet access services and networks; the adoption of new customer service or service quality requirements for our Internet access services; the adoption of new privacy restrictions on our collection, use and disclosure of certain customer information; new data security and cybersecurity mandates that could result in additional network and information security and cyber incident reporting requirements for our business; new restraints on our discretion over programming decisions; new restrictions on the rates we charge to consumers for one or more of the services or equipment options we offer; changes to the cable industry’s compulsory copyright to retransmit broadcast signals; new requirements to assure the availability of navigation devices from third-party providers; new Universal Service Fund contribution obligations on our Internet service revenues that would add to the cost of that service; increases in government-administered broadband subsidies to rural areas that could result in subsidized overbuilding of our facilities; changes to the FCC’s administration of spectrum; pending court challenges to the legality of the FCC’s Universal Service programs, which, if successful, could adversely affect our receipt of universal service funds, including but not limited to FCC RDOF grants to expand our network, FCC E-rate funds to serve schools and libraries and FCC Rural Health Care funds to serve eligible health care providers; and changes in the regulatory framework for VoIP telephone service, including the scope of regulatory obligations associated with our VoIP telephone service and our ability to interconnect our VoIP telephone service with incumbent providers of traditional telecommunications service.
This may include an increase in the number of homes that replace their video service with Internet-delivered and/or over-air content, as well as an increase in the number of Internet and voice customers substituting mobile data and voice products for wireline services, which would negatively impact our ability to attract customers, increase rates and maintain or increase revenue.
This may include an increase in the number of homes that replace their video service with Internet-delivered or over-air content, as well as an increase in the number of Internet and voice customers substituting mobile data and voice products for wireline services, which would negatively impact our ability to attract customers, increase rates and maintain or increase revenue.
Our ability to provide some services and complete our network evolution and rural construction initiatives might be materially adversely affected, or the need to procure or develop alternative sources of the affected materials or services might interrupt or delay our ability to serve existing and new customers, if any of these parties experience or engage in the following: • breach or terminate or elect not to renew their agreements with us or otherwise fail to perform their obligations in a timely manner; • demand exceeds these vendors’ capacity; • tariffs are imposed that impact vendors' ability to perform their obligations or significantly increase the amount we pay; • experience operating or financial difficulties; 19 • significantly increase the amount we are required to pay (including demands for substantial non-monetary compensation) for necessary products or services; or • cease production of any necessary product due to lack of demand, profitability or a change in ownership or are otherwise unable to provide the equipment or services we need in a timely manner at our specifications and at reasonable prices.
Our ability to provide some services and complete our network evolution and rural construction initiatives might be materially adversely affected, or the need to procure or develop alternative sources of the affected materials or services might interrupt or delay our ability to serve existing and new customers, if any of these parties experience or engage in the following: • breach or terminate or elect not to renew their agreements with us or otherwise fail to perform their obligations in a timely manner; • demand exceeds these vendors’ capacity; • tariffs are imposed that impact vendors’ ability to perform their obligations or significantly increase the amount we pay; • experience operating or financial difficulties; • significantly increase the amount we are required to pay (including demands for substantial non-monetary compensation) for necessary products or services; or • cease production of any necessary product due to lack of demand, profitability or a change in ownership or are otherwise unable to provide the equipment or services we need in a timely manner at our specifications and at reasonable prices.
If we choose technologies or equipment that are less effective, cost-efficient or attractive to customers than those chosen by our competitors, if technologies or equipment on which we have chosen to rely cease to be available to us on reasonable terms or conditions, if we offer services that fail to appeal to consumers, are not available at competitive prices or that do not function as expected, if we are not able to fund the expenditures necessary to keep pace with technological developments, or if we are no longer able to make our services available to our customers on a third- 20 party device on which a substantial number of customers have relied to access our services, our competitive position could deteriorate, and our business and financial results could suffer.
If we choose technologies or equipment that are less effective, cost-efficient or attractive to customers than those chosen by our competitors, if technologies or equipment on which we have chosen to rely cease to be available to us on reasonable terms or conditions, if we offer services that fail to appeal to consumers, are not available at competitive prices or that do not function as expected, if we are not able to fund the expenditures necessary to keep pace with technological developments, or if we are no longer able to make our services available to our customers on a third-party device on which a substantial number of customers have relied to access our services, our competitive position could deteriorate, and our business and financial results could suffer.
Liberty Broadband and A/N are required to vote (subject to the applicable voting cap) their respective shares of Charter Class A common stock and Charter Class B common stock for the director nominees nominated by the nominating and corporate governance committee of the board of directors, including the respective designees of Liberty Broadband and A/N, and against any other nominees, except that, with respect to the unaffiliated directors, Liberty Broadband and A/N must instead vote in the same proportion as the voting securities are voted by stockholders other than A/N and Liberty Broadband or any group which includes any of them are voted, if doing so would cause a different outcome with respect to the unaffiliated directors.
Liberty Broadband and A/N are required to vote (subject to the applicable voting cap) their respective shares of Charter Class A common stock and Charter Class B common stock for the director nominees nominated by the Nominating and Corporate Governance Committee, including the respective designees of Liberty Broadband and A/N, and against any other nominees, except that, with respect to the unaffiliated directors, Liberty Broadband and A/N must instead vote in the same proportion as the voting securities are voted by stockholders other than A/N and Liberty Broadband or any group which includes any of them are voted, if doing so would cause a different outcome with respect to the unaffiliated directors.
We, and the third parties on which we rely, may be unable to anticipate these techniques or implement adequate preventive measures. While from time to time attempts 21 have been made to access our network, these events have not as yet resulted in any material release of information, degradation or disruption to our network and information systems.
We, and the third parties on which we rely, may be unable to anticipate these techniques or implement adequate preventive measures. While from time to time attempts have been made to access our network, these events have not as yet resulted in any material release of information, degradation or disruption to our network and information systems.
Our cable system franchises are non-exclusive. Consequently, local and state franchising authorities can grant additional franchises to competitors in the same geographic area or operate their own cable systems. In some cases, local government entities and municipal utilities may legally compete with us on more favorable terms. 26
Our cable system franchises are non-exclusive. Consequently, local and state franchising authorities can grant additional franchises to competitors in the same geographic area or operate their own cable systems. In some cases, local government entities and municipal utilities may legally compete with us on more favorable terms.
If we are unable to continue to grow our mobile business and achieve the outcomes we expect from our investments in the mobile business, our growth, financial condition and results of operations could be adversely affected. Our business may be adversely affected if we cannot continue to license or enforce the intellectual property rights on which our business depends.
If we are unable to continue 21 to grow our mobile business and achieve the outcomes we expect from our investments in the mobile business, our growth, financial condition and results of operations could be adversely affected. Our business may be adversely affected if we cannot continue to license or enforce the intellectual property rights on which our business depends.
As a result, if Liberty Broadband and/or A/N 24 elect to exercise their preemptive rights, (i) these parties would not experience the dilution experienced by the other holders of Charter Class A common stock, and (ii) such other holders of Charter Class A common stock may experience further dilution of their interest in Charter upon such exercise.
As a result, if Liberty Broadband and/or A/N elect to exercise their preemptive rights, (i) these parties would not experience the dilution experienced by the other holders of Charter Class A common stock, and (ii) such other holders of Charter Class A common stock may experience further dilution of their interest in Charter upon such exercise.
It remains uncertain what rule changes, if any, will ultimately be adopted by Congress, the FCC and state legislatures, and what operating or financial impact any such rules might have on us, including on the operation of our broadband networks, customer privacy and the user experience.
It remains uncertain what rule changes, if any, will ultimately be adopted by Congress, the FCC, the FTC and state legislatures, and what operating or financial impact any such rules might have on us, including on the operation of our broadband networks, customer privacy and the user experience.
In addition, the existence of only a limited number of vendors of key technologies can lead to less product innovation and higher costs. These events could materially and adversely affect our ability to retain and attract customers and our operations, business, financial results and financial condition.
In addition, the existence of only a limited number of vendors of key technologies can lead to less product innovation and higher costs. Any of these events could materially and adversely affect our ability to retain and attract customers and our operations, business, financial results and financial condition.
We provide certain confidential, proprietary and personal information to third parties in connection with our business, and there is a risk that this information may be compromised. We process, store, and transmit large amounts of data, including the personal information of our customers.
We provide certain confidential, proprietary and personal information to third parties in connection with our business, and there is a risk that this information may be compromised. 22 We process, store, and transmit large amounts of data, including the personal information of our customers.
A/N currently owns Charter Class A common stock and a significant amount of membership interests in our subsidiary Charter Holdings, which are convertible into Charter Class A common stock, and is entitled to certain governance rights with respect to Charter.
A/N currently owns Charter Class A common stock and a significant amount of membership 24 interests in our subsidiary, Charter Holdings, which are convertible into Charter Class A common stock, and is entitled to certain governance rights with respect to Charter.
These covenants restrict, among other things, CCO Holdings, CCO Holdings Capital Corp. and all of their restricted subsidiaries’ ability to: • incur additional debt; • pay dividends on equity or repurchase equity; • make investments; • sell all or substantially all of their assets or merge with or into other companies; 23 • sell assets; • in the case of restricted subsidiaries, create or permit to exist dividend or payment restrictions with respect to CCO Holdings, guarantee their parent companies debt, or issue specified equity interests; • engage in certain transactions with affiliates; and • grant liens (with respect to only CCO Holdings).
These covenants restrict, among other things, CCO Holdings, CCO Holdings Capital Corp. and all of their restricted subsidiaries’ ability to: • incur additional debt; • pay dividends on equity or repurchase equity; • make investments; • sell all or substantially all of their assets or merge with or into other companies; • sell assets; • in the case of restricted subsidiaries, create or permit to exist dividend or payment restrictions with respect to CCO Holdings, guarantee their parent companies' debt, or issue specified equity interests; • engage in certain transactions with affiliates; and • grant liens (with respect to only CCO Holdings).
The loss of 22 the services of key members of management and the inability or delay in hiring new key employees could adversely affect our ability to manage our business and our future operational and financial results.
The loss of the services of key members of management and the inability or delay in hiring new key employees could adversely affect our ability to manage our business and our future operational and financial results.
Each of A/N and Liberty Broadband is entitled to nominate at least one director to each of the committees of Charter's board of directors, subject to applicable stock exchange listing rules and certain specified voting or equity ownership thresholds for each of A/N and Liberty Broadband, and provided that the Nominating and Corporate Governance Committee and the Compensation and Benefit Committee each have at least a majority of directors independent from A/N, Liberty Broadband and Charter (referred to as the “unaffiliated directors” in the Stockholders Agreement).
Each of A/N and Liberty Broadband is entitled to nominate at least one director to each of the committees of Charter's Board of Directors, subject to applicable stock exchange listing rules and certain specified voting or equity ownership thresholds for each of A/N and Liberty Broadband, and provided that the Nominating and Corporate Governance Committee and the Compensation and Benefits Committee each have at least a majority of directors independent from A/N, Liberty Broadband and Charter (referred to as the “unaffiliated directors” in the Stockholders Agreement).
In some instances, we compete against companies with fewer regulatory burdens, access to better financing and greater and more favorable brand name recognition. Increasing consolidation in the telecommunications and content industries have provided additional benefits to certain of our competitors, either through access to financing, resources, or efficiencies of scale including the ability to launch new video services.
In some instances, we compete against companies with fewer regulatory burdens, access to better financing and greater and more favorable brand name recognition. Increasing consolidation in the telecommunications and content industries have provided additional benefits to certain of our competitors, either through access to financing, resources, or efficiencies of scale including the ability to launch new products and services.
Risks Related to Ownership Position of Liberty Broadband Corporation and Advance/Newhouse Partnership Liberty Broadband Corporation ("Liberty Broadband") and Advance/Newhouse Partnership (“A/N”) have governance rights that give them influence over corporate transactions and other matters. Liberty Broadband currently owns a significant amount of Charter Class A common stock and is entitled to certain governance rights with respect to Charter.
Risks Related to Ownership Position of Liberty Broadband Corporation and Advance/Newhouse Partnership Liberty Broadband Corporation (“Liberty Broadband”) and Advance/Newhouse Partnership (“A/N”) have governance rights that give them influence over corporate transactions and other matters. Liberty Broadband currently owns a significant amount of Charter Class A common stock and is entitled to certain governance rights with respect to Charter.
While decreases in video customers combined with a change in the mix of customers choosing lower cost packages have lowered total programming cost increases, we expect contractual programming rates per service subscriber to continue to increase as a result of annual increases pursuant to our programming contracts and contract renewals with programmers.
While decreases in video customers combined with a change in the mix of customers choosing lower cost packages have offset total programming cost increases, we expect contractual programming rates per service subscriber to continue to increase as a result of annual increases pursuant to our programming contracts and contract renewals with programmers.
We operate cable systems in locations throughout the United States and, as a result, we are subject to the tax laws and regulations of federal, state and local governments. From time to time, legislative and administrative bodies change laws and regulations that change our effective tax rate or tax payments.
We offer services and operate cable systems in locations throughout the United States and, as a result, we are subject to the tax laws and regulations of federal, state and local governments. From time to time, legislative and administrative bodies change laws and regulations that change our effective tax rate or tax payments.
Additionally, the demands of large media companies, with additional selling power as a result of media and broadcast station groups consolidation, who link carriage of their most popular networks to carriage and cost increases of their less popular networks, and require us to carry their most popular networks to a large percentage of our video subscribers, have limited our flexibility in selling more tailored and cost-sensitive programming packages for consumers.
Additionally, the demands of large media companies, with additional selling power as a result of media 20 and broadcast station group consolidation, who link carriage of their most popular networks to carriage and cost increases of their less popular networks, and require us to carry their most popular networks to a large percentage of our video subscribers, have limited our flexibility in selling more tailored and cost-sensitive programming packages for consumers.
Members of the Charter board of directors include a director who is also an officer and director of Liberty Broadband and directors who are current or former officers and directors of A/N. Mr. Greg Maffei is the President and Chief Executive Officer of Liberty Broadband.
Members of Charter's Board of Directors include a director who is also an officer and director of Liberty Broadband and directors who are current or former officers and directors of A/N. Mr. Greg Maffei is the President and Chief Executive Officer of Liberty Broadband.
Our significant amount of debt could have consequences, such as: • impact our ability to raise additional capital at reasonable rates, or at all; • make us vulnerable to interest rate increases, in part because approximately 15% of our borrowings as of December 31, 2022 were, and may continue to be, subject to variable rates of interest; • expose us to increased interest expense to the extent we refinance existing debt with higher cost debt; • require us to dedicate a significant portion of our cash flow from operating activities to make payments on our debt, reducing our funds available for working capital, capital expenditures, and other general corporate expenses; • limit our flexibility in planning for, or reacting to, changes in our business, the cable and telecommunications industries, and the economy at large; • place us at a disadvantage compared to our competitors that have proportionately less debt; and • adversely affect our relationship with customers and suppliers.
Our significant amount of debt could have adverse consequences, such as: • impact our ability to raise additional capital at reasonable rates, or at all; • make us vulnerable to interest rate increases, in part because approximately 14% of our borrowings as of December 31, 2023 were, and may continue to be, subject to variable rates of interest; • expose us to increased interest expense to the extent we refinance existing debt with higher cost debt; • require us to dedicate a significant portion of our cash flow from operating activities to make payments on our debt, reducing our funds available for capital expenditures and other general corporate purposes; • limit our flexibility in planning for, or reacting to, changes in our business, the cable and telecommunications industries, and the economy at large; • place us at a disadvantage compared to our competitors that have proportionately less debt; and • adversely affect our relationship with customers and suppliers.
The Charter Operating credit facilities, the Charter Operating notes, the TWC, LLC senior notes and debentures, and the TWCE debentures include customary negative covenants, including restrictions on the ability to incur liens securing indebtedness for borrowed money and consolidating, merging or conveying or transferring substantially all of the respective obligor’s assets.
The Charter Operating credit facilities, the Charter Operating notes, the Time Warner Cable, LLC ("TWC, LLC") senior notes and debentures, and the Time Warner Cable Enterprises, LLC ("TWCE") debentures include customary negative covenants, including restrictions on the ability to incur liens securing indebtedness for borrowed money and consolidating, merging or conveying or transferring substantially all of the respective obligor’s assets.
We may not have the ability to pass on to our customers all of the increases in programming costs, which could adversely affect our cash flow and operating margins. Programming costs are our single largest expense item. Our programming costs have historically increased in excess of customary inflationary and cost-of-living type increases.
We may not have the ability to pass on to our customers all of the increases in programming costs, which could adversely affect our cash flow and operating margins. Programming costs are one of our largest expense items. Our programming costs have historically increased in excess of customary inflationary and cost-of-living type increases.
Additionally, the Charter Operating credit facilities require Charter Operating to comply with a maximum total leverage covenant and a maximum first lien leverage covenant.
Additionally, the Charter Communications Operating, LLC ("Charter Operating") credit facilities require Charter Operating to comply with a maximum total leverage covenant and a maximum first lien leverage covenant.
Newer products and services, particularly alternative methods for the distribution, sale and viewing of content will likely continue to be developed, further increasing the number of competitors that we face.
Newer products and services, particularly alternative methods for the distribution, sale and viewing of content may continue to be developed, further increasing the number of competitors that we face.
We have a significant amount of debt and expect to (subject to applicable restrictions in our debt instruments) incur additional debt in the future as we maintain our stated objective of 4.0 to 4.5 times Adjusted EBITDA leverage (net debt divided by the last twelve months Adjusted EBITDA).
We have a significant amount of debt and expect to (subject to applicable restrictions in our debt instruments) incur additional debt in the future as Charter maintains its stated objective of 4.0 to 4.5 times Adjusted EBITDA leverage (net debt divided by 23 the last twelve months Adjusted EBITDA).
A failure to effectively anticipate or adapt to new technologies and changes in customer expectations and behavior could significantly adversely affect our competitive position with respect to the leisure time and discretionary spending of our customers and, as a result, affect our business and results of operations.
A failure to effectively anticipate or adapt to new technologies (including those that use artificial intelligence ("AI")) and changes in customer expectations and behavior could significantly adversely affect our competitive position with respect to the leisure time and discretionary spending of our customers and, as a result, affect our business and results of operations.
Steven Miron is the Chief Executive Officer of A/N and Michael Newhouse is co-president of the parent of A/N and its affiliates. As of December 31, 2022, Liberty Broadband beneficially held approximately 27.64% of Charter’s voting stock and A/N beneficially held approximately 12.48% of Charter’s voting stock.
Steven Miron is the Chief Executive Officer of A/N and Michael Newhouse is co-president of the parent of A/N and its affiliates. As of December 31, 2023, Liberty Broadband beneficially held approximately 28.50% of Charter’s voting stock and A/N beneficially held approximately 12.46% of Charter’s voting stock.
To the extent our current debt amounts increase more than expected, our business results are lower than expected, or credit rating agencies downgrade our debt limiting our access to investment grade markets, the related risks that we now face will intensify.
To the extent our current debt amounts increase more than expected, our operating results are lower than expected, or credit rating agencies downgrade our debt thereby increasing our costs of borrowing and potentially limiting our access to investment grade markets, the related risks that we now face will intensify.
Our video service faces competition from a number of sources, including DBS services, and companies that deliver linear network programming, movies and television shows on demand and other video content over broadband Internet connections to televisions, computers, tablets and mobile devices often with password sharing among multiple users and security that makes content susceptible to piracy.
Competition from these companies, including intensive marketing efforts with aggressive pricing, may have an adverse impact on our ability to attract and retain customers. 19 Our video service faces competition from a number of sources, including DBS services, and companies that deliver linear network programming, movies and television shows on demand and other video content over broadband Internet connections to televisions, computers, tablets and mobile devices often with password sharing among multiple users and security that makes content susceptible to piracy.
Any failure to comply with the rules and requirements of a subsidy grant could result in us being suspended or disbarred from future governmental programs or contracts for a significant period of time, which could adversely affect our results of operations and financial condition.
Any failure to comply with the rules and requirements of a subsidy grant could result in us being suspended or disbarred from future governmental programs or contracts for a significant period of time, which could adversely affect our results of operations and financial condition. 26 If any laws or regulations are enacted that would expand the regulation of our services, they could affect our operations and require significant expenditures.
The indentures governing the CCO Holdings, LLC ("CCO Holdings") notes contain a number of significant covenants that could adversely affect our ability to operate our business, our liquidity, and our results of operations.
The agreements and instruments governing our debt contain restrictions and limitations that could significantly affect our ability to operate our business, as well as significantly affect our liquidity. The indentures governing the CCO Holdings, LLC (“CCO Holdings”) notes contain a number of significant covenants that could adversely affect our operations, liquidity and results of operations.
Cable operators are subject to numerous laws and regulations including those covering the following: • the provision of high-speed Internet service, including net neutrality and broadband label transparency rules; • the provision of voice communications, including rules for emergency communications, outage reporting, Customer Proprietary Network Information (“CPNI”) reporting and efforts to limit unwanted robocalls; • cable franchise renewals and transfers; • the provisioning, marketing and billing of cable and Internet equipment; • customer and employee privacy and data security; • copyright royalties for retransmitting broadcast signals; • the circumstances when a cable system must carry a broadcast station and the circumstances when it first must obtain retransmission consent to carry a broadcast station; • limitations on our ability to enter into exclusive agreements with multiple dwelling unit complexes and control our inside wiring; • equal employment opportunity; • the resiliency of our networks to maintain service during and after disasters and power outages; • emergency alert systems, disability access, pole attachments, commercial leased access and technical standards; • marketing practices, customer service, and consumer protection; and • approval for mergers and acquisitions often accompanied by the imposition of restrictions and requirements on an applicant’s business in order to secure approval of the proposed transaction.
The services we offer are subject to numerous laws and regulations that can increase operational and administrative expenses and reduce revenues, including those covering the following: • the provision of high-speed Internet service, including network management, broadband label, broadband availability reporting, digital discrimination and transparency rules; • the provision of fixed and mobile voice communications, including rules for emergency communications, network and/or 911 outage reporting, CPNI safeguards and reporting, local number portability, efforts to limit unwanted robocalls, and, for mobile devices, hearing aid compatibility, safety and emission requirements; • the fees that must be included in our advertised prices and bills, and the means by which our customers can cancel services; • access by law enforcement; • cable franchise renewals and transfers; • the provisioning, marketing and billing of cable and Internet equipment; • customer and employee privacy and data security; • copyright royalties for retransmitting broadcast signals; 25 • the circumstances when a cable system must carry a broadcast station and the circumstances when it first must obtain retransmission consent to carry a broadcast station; • limitations on our ability to enter into exclusive agreements with multiple dwelling unit complexes and control our inside wiring; • equal employment opportunity; • the resiliency of our networks to maintain service during and after disasters and power outages; • emergency alert systems, disability access, pole attachments, commercial leased access and technical standards; • marketing practices, customer service, and consumer protection; and • approval for mergers and acquisitions often accompanied by the imposition of restrictions and requirements on an applicant’s business in order to secure approval of the proposed transaction.
If any laws or regulations are enacted that would expand the regulation of our services, they could affect our operations and require significant expenditures. We cannot predict future developments in these areas, and any changes to the regulatory framework for our Internet, video, mobile or VoIP services could have a negative impact on our business and results of operations.
We cannot predict future developments in these areas, and any changes to the regulatory framework for our Internet, video, mobile or VoIP services could have a negative impact on our business and results of operations.
As of December 31, 2022, our total principal amount of debt was approximately $97.4 billion with a leverage ratio of 4.47 times Adjusted EBITDA. As of December 31, 2022, $70.7 billion of our debt was rated investment grade and $26.7 billion was rated high yield debt.
As of December 31, 2023, our total principal amount of debt was approximately $97.6 billion and Charter's leverage ratio was 4.42 times Adjusted EBITDA. As of December 31, 2023, $70.3 billion of our debt was rated investment grade and $27.3 billion was rated high yield debt.
Both unsuccessful and successful “cyber attacks” on companies have continued to increase in frequency, scope and potential harm in recent years.
Both unsuccessful and successful “cyber attacks” on companies have continued to increase in frequency, scope and potential harm in recent years, and the increasing use of AI may intensify these cybersecurity risks.
We are exposed to risks associated with the economic conditions of our current and potential customers, the potential financial instability of our customers and their financial ability to purchase our products. If there were a prolonged general economic downturn, we may experience increased cancellations or non-payment by our customers or unfavorable changes in the mix of products purchased.
If there were a prolonged general economic downturn, we may experience increased cancellations or non-payment by our customers or unfavorable changes in the mix of products purchased.
Our operational results have depended, and our future results will depend, upon the retention and continued performance of our management team. Our ability to retain and hire new key employees for management positions could be impacted adversely by the competitive environment for management talent in the broadband communications and technology industries.
Our ability to hire and retain key employees for management positions could be impacted adversely by the competitive environment for management talent in the broadband communications and technology industries.
Risks Related to Regulatory and Legislative Matters Our business is subject to extensive governmental legislation and regulation, which could adversely affect our business. Regulation of the cable industry has increased cable operators’ operational and administrative expenses and limited their revenues.
Risks Related to Regulatory and Legislative Matters Our business is subject to extensive governmental legislation and regulation, which could adversely affect our business.
Changes to existing statutes, rules, regulations, or interpretations thereof, or adoption of new ones, or participation in new regulatory programs, could have an adverse effect on our business. There are ongoing efforts to amend or expand the federal, state, and local regulation of some of the services offered over our cable systems, particularly our retail broadband Internet access service.
There are ongoing efforts to amend or expand the federal, state and local regulation of some of the services offered over our cable systems, particularly our retail broadband Internet access service.
Any interruption in the services provided by our vendors or by third parties could adversely affect our cash flow, results of operation and financial condition. If we are unable to retain key employees, our ability to manage our business could be adversely affected.
Further, inflationary pressures may impact the ability of vendors and other third parties to satisfy their obligations to us. Any interruption in the services provided by our vendors or by third parties could adversely affect our cash flow, results of operation and financial condition.
Our voice and mobile services compete with wireless and wireline phone providers, as well as other forms of communication, such as text, instant messaging, social networking services, video conferencing and email. Competition from these companies, including intensive marketing efforts with aggressive pricing and exclusive programming, may have an adverse impact on our ability to attract and retain customers.
Our voice and mobile services compete with wireless and wireline phone providers, as well as other forms of communication, such as text, instant messaging, social networking services, video conferencing and email.
Carriage of these other services, as well as increased fees for retransmission rights, may increase our programming expenses and diminish the amount of capacity we have available to introduce new services, which could have an adverse effect on our business and financial results.
Carriage of these other services, as well as increased fees for retransmission rights, may increase our programming expenses which could have an adverse effect on our business and financial results. Our programming contracts are generally for a fixed period of time, with potentially significant spend subject to negotiated renewal in any particular year.
We also could be required to expend significant capital and other resources to remedy any such security breach. Our exposure to the economic conditions of our current and potential customers, vendors and third parties could adversely affect our cash flow, results of operations and financial condition.
Our exposure to the economic conditions of our current and potential customers, vendors and third parties could adversely affect our cash flow, results of operations and financial condition. We are exposed to risks associated with the economic conditions of our current and potential customers, the potential financial instability of our customers and their financial ability to purchase our products.
Our programming contracts are generally for a fixed period of time, with potentially significant spend subject to negotiated renewal in any particular year. We will seek to renew these agreements on terms that we believe are favorable. There can be no assurance that these agreements will be renewed on favorable or comparable terms.
We will seek to renew these agreements on terms that we believe are favorable. There can be no assurance that these agreements will be renewed on favorable or comparable terms.
In order to mitigate impacts to our operating margins due to increasing programming rates, we continue to review our pricing and programming packaging strategies. Increases in the cost of sports programming and the amounts paid for local broadcast station retransmission consent have been the largest contributors to the growth in our programming costs over the last few years.
We are seeking to obtain access to these DTC apps, where applicable, as we renew agreements, so that we may include in our customers' video subscriptions. Increases in the cost of sports programming and the amounts paid for local broadcast station retransmission-consent have been the largest contributors to the growth in our programming costs over the last few years.
Removed
Our third-party service providers, suppliers and licensors have been disrupted by worker absenteeism, quarantines, restrictions on employees’ ability to work, office and factory closures, disruptions to ports and other shipping infrastructure, border closures, or other travel or health-related restrictions over the last three years.
Added
In order to mitigate impacts to our operating margins due to increasing programming rates, we continue to review our pricing and programming packaging strategies.
Removed
In addition, a portion of our variable rate indebtedness may use London Interbank Offering Rate (“LIBOR”) as a benchmark for establishing the rate. The United Kingdom’s Financial Conduct Authority, which regulates LIBOR, stopped publishing one week and 2 month U.S. Dollar (“USD”) LIBOR rates after 2021 with remaining USD LIBOR rates ceasing to be published after June 30, 2023.
Added
Further, some programmers have begun to simulcast and/or move popular programming to DTC apps which, in some cases, are no longer accessible by our customers through their current video subscription, despite increasing rates, driving customer dissatisfaction and in turn, customer losses.
Removed
In the United States, the U.S. Federal Reserve, in conjunction with the Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial institutions, has proposed the Secured Overnight Financing Rate (“SOFR”), a new index calculated by short-term repurchase agreements backed by Treasury securities, as an alternative to LIBOR.
Added
We also could be required to expend significant capital and other resources to remedy any such security breach. Issues related to the development and use of AI could give rise to legal or regulatory action, damage our reputation or otherwise materially harm our business. We currently incorporate AI technology in certain parts of our business operations.
Removed
In addition, the overall financial markets may be disrupted as a result of the phase-out or replacement of LIBOR. Uncertainty as to the nature of such phase out and selection of an alternative reference rate, together with disruption in the financial markets, could increase the cost of our variable rate indebtedness.
Added
Our research and development of such technology remains ongoing. AI presents risks, challenges and unintended consequences that could affect our and our customers’ adoption and use of this technology. AI algorithms and training methodologies may be flawed. Additionally, AI technologies are complex and rapidly evolving.
Removed
As a result of the pending cessation of LIBOR, we amended the Charter Operating credit agreement to replace LIBOR with SOFR as the interest rate benchmark for the revolving credit facility and certain of the term loans thereunder.
Added
While we aim to develop and use AI responsibly and attempt to identify and mitigate ethical and legal issues presented by its use, we may be unsuccessful in identifying or resolving issues before they arise.
Removed
SOFR may fluctuate based on general economic conditions, general interest rates, Federal Reserve rates and the supply of and demand for credit in the market. The agreements and instruments governing our debt contain restrictions and limitations that could significantly affect our ability to operate our business, as well as significantly affect our liquidity.
Added
AI-related issues, deficiencies or failures could give rise to legal or regulatory action, including with respect to proposed legislation regulating AI or as a result of new applications of existing data protection, privacy, intellectual property and other laws, and could damage our reputation or otherwise materially harm our business.
Added
If we are unable to retain key employees, our ability to manage our business could be adversely affected. Our operational results have depended, and our future results will depend, upon the retention and continued performance of our management team.
Added
Changes to the existing legal and regulatory framework under which we operate or the regulatory programs in which we or our competitors participate, including the possible elimination of the federal broadband ACP subsidy for low-income consumers, could adversely affect our business.
Added
We participate in the federal ACP that provides up to a $30 monthly subsidy enabling eligible low-income households to purchase our Internet products at a discount or, for a portion of those households, at no cost.
Added
The FCC has announced that ACP funding is expected to run out in April 2024 and has prohibited service providers from enrolling new ACP customers after February 7, 2024. If Congress does not provide additional funding, this will be disruptive to our business.
Added
We will lose customers and revenues and could face greater difficulty in providing services to low-income households in the future. As a winning bidder in the FCC’s RDOF auction in 2020, we must comply with numerous FCC and state requirements to continue receiving such funding.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeOur headend and tower locations are located on owned or leased parcels of land, and we generally own the towers on which our equipment is located. The physical components of our cable systems require maintenance as well as periodic upgrades to support the new services and products we introduce. See “Item 1.
Biggest changeOur headend locations are located on owned or leased parcels of land. The physical components of our cable systems require 29 maintenance as well as periodic upgrades to support the new services and products we introduce. See “Item 1.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plans The following information is provided as of December 31, 2022 with respect to equity compensation plans: Plan Category Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted Average Exercise Price of Outstanding Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans Equity compensation plans approved by security holders 10,445,568 (1) $ 414.84 10,478,392 (1) Equity compensation plans not approved by security holders — $ — — TOTAL 10,445,568 (1) 10,478,392 (1) (1) This total does not include 6,845 shares issued pursuant to restricted stock grants made under our 2019 Stock Incentive Plan, which are subject to vesting based on continued service.
Biggest changePlan Category Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted Average Exercise Price of Outstanding Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans Equity compensation plans approved by security holders 15,029,325 (1) $ 403.81 5,113,241 (1) Equity compensation plans not approved by security holders — $ — — TOTAL 15,029,325 (1) 5,113,241 (1) (1) This total does not include 10,609 shares issued pursuant to restricted stock grants made under Charter's 2019 Stock Incentive Plan, which are subject to vesting based on continued service.
For information regarding securities issued under our equity compensation plans, see Note 16 to our accompanying consolidated financial statements contained in “Part II. Item 8.
For information regarding securities issued under Charter's equity compensation plans, see Note 16 to our accompanying consolidated financial statements contained in “Part II. Item 8.
Purchases of Equity Securities by the Issuer The following table presents Charter’s purchases of equity securities completed during the fourth quarter of 2022 (dollars in millions, except per share data).
Purchases of Equity Securities by the Issuer The following table presents Charter’s purchases of equity securities completed during the fourth quarter of 2023 (dollars in millions, except per share data).
As of December 31, 2022, Charter had remaining board authority to purchase an additional $414 million of Charter’s Class A common stock and/or Charter Holdings common units, excluding purchases from Liberty Broadband.
As of December 31, 2023, Charter had remaining board authority to purchase an additional $170 million of Charter’s Class A common stock and/or Charter Holdings common units, excluding purchases from Liberty Broadband.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Charter’s Class A common stock is listed on the NASDAQ Global Select Market under the symbol “CHTR.” As of December 31, 2022, there were approximately 10,000 holders of record of Charter’s Class A common stock and one holder of Charter's Class B common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Charter’s Class A common stock is listed on the NASDAQ Global Select Market under the symbol “CHTR.” As of December 31, 2023, there were approximately 9,300 holders of record of Charter’s Class A common stock and one holder of Charter's Class B common stock.
Financial Statements and Supplementary Data.” Performance Graph The performance graph required by Item 5 will be included in Charter’s 2023 Proxy Statement (the “Proxy Statement”) under the headings “Compensation Discussion and Analysis,” or in amendment to this Annual Report on Form 10-K and is incorporated herein by reference.
Financial Statements and Supplementary Data.” Performance Graph The performance graph required by Item 5 will be included in Charter’s 2024 Proxy Statement (the “Proxy Statement”) under the heading “Compensation Discussion and Analysis” or in an amendment to this Annual Report on Form 10-K and is incorporated herein by reference.
(2) During the three months ended December 31, 2022, Charter purchased approximately 3.0 million shares of its Class A common stock for approximately $1.0 billion, which includes 1.2 million Charter class A common shares purchased from Liberty Broadband pursuant to the LBB Letter Agreement at an average price per unit of $354.97, or $432 million.
(2) During the three months ended December 31, 2023, Charter purchased approximately 2.8 million shares of its Class A common stock for approximately $1.2 billion, which includes 0.8 million Charter class A common shares purchased from Liberty Broadband pursuant to the LBB Letter Agreement at an average price per unit of $423.95, or $352 million.
Charter Holdings purchased 0.6 million Charter Holdings common units from A/N at an average price per unit of $363.53, or $223 28 million during the three months ended December 31, 2022.
Charter 31 Holdings purchased 0.4 million Charter Holdings common units from A/N at an average price per unit of $428.47, or $173 million during the three months ended December 31, 2023.
Charter has not paid cash dividends on its common stock and does not intend to do so in the foreseeable future. During 2022, there were no unregistered sales of securities of the registrant.
Charter has not paid cash dividends on its common stock and does not intend to do so in the foreseeable future. During 2023, there were no unregistered sales of securities of the registrant. Securities Authorized for Issuance Under Equity Compensation Plans The following information is provided as of December 31, 2023 with respect to Charter's equity compensation plans.
Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) October 1 - 31, 2022 1,852,906 $ 336.79 1,848,774 $166 November 1 - 30, 2022 817,707 $ 337.34 796,644 $202 December 1 - 31, 2022 395,322 $ 362.67 385,676 $414 (1) Includes 4,132, 21,063 and 9,646 shares withheld from employees for the payment of taxes and exercise costs upon the exercise of stock options or vesting of other equity awards for the months of October, November and December 2022, respectively.
Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) October 1 - 31, 2023 1,051,761 $ 434.65 1,049,735 $454 November 1 - 30, 2023 1,164,184 $ 417.85 993,441 $272 December 1 - 31, 2023 753,534 $ 392.74 744,109 $170 (1) Includes 2,026, 170,743 and 9,425 shares withheld from employees for the payment of taxes and exercise costs upon the exercise of stock options or vesting of other equity awards for the months of October, November and December 2023, respectively.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeRegulatory, connectivity and produced content decreased $191 million during the year ended December 31, 2022 compared to the corresponding period in 2021 primarily due to lower costs of video devices sold to customers and regulatory pass-through fees as well as lower sports rights costs as a result of more basketball games during 2021 as compared to 2022 as the prior period had additional games due to the delayed start of the 2020 - 2021 National Basketball Association ("NBA") season as a result of COVID-19. 35 Costs to service customers increased $379 million during the year ended December 31, 2022 compared to the corresponding period in 2021 primarily due to higher bad debt, adjustments to job structure, pay and benefits to build a more skilled and longer tenured workforce and fuel costs.
Biggest changeCosts to service customers increased $328 million during the year ended December 31, 2023 compared to the corresponding period in 2022 primarily due to adjustments to job structure, pay and benefits to build a more skilled and longer tenured workforce resulting in lower frontline employee attrition compared to 2022, and additional activity to support the accelerated growth of Spectrum Mobile.
The remaining 10% of revenue is derived primarily from advertising revenues, franchise and other regulatory fee revenues (which are collected by us but then paid to local authorities), sales of mobile and video devices, processing fees or reconnection fees charged to customers to commence or reinstate service, installation, VOD and pay-per-view programming, and commissions related to the sale of merchandise by home shopping services.
The remaining 10% of our revenue is derived primarily from advertising revenues, franchise and other regulatory fee revenues (which are collected by us but then paid to local authorities), sales of mobile and video devices, processing fees or reconnection fees charged to customers to commence or reinstate service, installation, VOD and pay-per-view programming, and commissions related to the sale of merchandise by home shopping services.
Costs capitalized include materials, direct labor and certain indirect 30 costs. These indirect costs consist of compensation and overhead costs associated with support functions. While our capitalization is based on specific activities, once capitalized, we track these costs on a composite basis by fixed asset category at the cable system level, and not on a specific asset basis.
Costs capitalized include materials, direct labor and certain indirect costs. These indirect costs consist of compensation and overhead costs associated with support functions. While our capitalization is based on specific activities, once capitalized, we track these costs on a composite basis by fixed asset category at the cable system level, and not on a specific asset basis.
Costs for repairs and maintenance are charged to operating expense as incurred, while plant and equipment replacement, including replacement of certain components, betterments, and replacement of cable drops and outlets, are capitalized. We make judgments regarding the installation and construction activities to be capitalized.
Costs for repairs and maintenance are charged to operating expense as incurred, 33 while plant and equipment replacement, including replacement of certain components, betterments, and replacement of cable drops and outlets, are capitalized. We make judgments regarding the installation and construction activities to be capitalized.
However, the amount that is currently payable if the debt becomes immediately due is equal to the principal amount of the debt. In regards to the Sterling Notes, the principal amount of the debt and any premium or discount is remeasured into US dollars as of each balance sheet date.
However, the amount that is currently payable if the debt becomes immediately due is equal to the principal amount of the debt. In regards to the Sterling Notes, the principal amount of the debt and any premium or discount is remeasured 45 into US dollars as of each balance sheet date.
As of December 31, 2022, the accumulated benefit obligation and fair value of plan assets was $2.2 billion and $2.6 billion, respectively, and the net funded asset was recorded as a $362 million noncurrent asset, $5 million current liability and $17 million long-term liability.
As of December 31, 2022, the accumulated benefit obligation and fair value of plan assets was $2.2 billion and $2.6 billion, respectively, and the net funded asset was 34 recorded as a $362 million noncurrent asset, $5 million current liability and $17 million long-term liability.
Other revenues consist of revenue from processing fees, regional sports and news channels (excluding intercompany charges or advertising sales on those channels), subsidy revenue, home shopping, video device sales, wire maintenance fees and other miscellaneous revenues.
Other revenues consist of revenue from mobile and video device sales, processing fees, regional sports and news channels (excluding intercompany charges or advertising sales on those channels), subsidy revenue, home shopping, wire maintenance fees and other miscellaneous revenues.
We continue to evaluate the deployment of our cash on hand and anticipated future free cash flow including to invest in our business growth and other strategic opportunities, including expanding the capacity of our network, the expansion of our network through our rural broadband construction initiative, the build-out and deployment of our CBRS spectrum, and mergers and acquisitions as well as stock repurchases and dividends.
We continue to evaluate the deployment of our cash on hand and anticipated future free cash flow, including investing in our business growth and other strategic opportunities, including expanding the capacity of our network, the expansion of our network through our rural broadband construction initiative, the build-out and deployment of our CBRS spectrum, and mergers and acquisitions as well as stock repurchases and dividends.
The agreements and instruments governing our debt and financing arrangements are complicated and you should consult such agreements and instruments which are filed with the SEC for more detailed information. At December 31, 2022, Charter Operating had a consolidated leverage ratio of approximately 3.0 to 1.0 and a consolidated first lien leverage ratio of 3.0 to 1.0.
The agreements and instruments governing our debt and financing arrangements are complicated and you should consult such agreements and instruments which are filed with the SEC for more detailed information. At December 31, 2023, Charter Operating had a consolidated leverage ratio of approximately 3.0 to 1.0 and a consolidated first lien leverage ratio of 3.0 to 1.0.
Approximately 90% of our revenues for each of the years ended December 31, 2022 and 2021 are attributable to monthly subscription fees charged to customers for our Internet, video, voice, mobile and commercial services as well as regional sports and news channels.
Approximately 90% of our revenues for each of the years ended December 31, 2023 and 2022 are attributable to monthly subscription fees charged to customers for our Internet, video, voice, mobile and commercial services as well as regional sports and news channels.
We determined the discount rate used to compute pension expense based on the yield of a large population of high-quality corporate bonds with cash flows sufficient in timing and amount to settle projected future defined benefit payments.
We determined the discount rate used to compute pension cost based on the yield of a large population of high-quality corporate bonds with cash flows sufficient in timing and amount to settle projected future defined benefit payments.
A decrease in the expected long-term rate of return of 25 basis points to 4.75%, while holding all other assumptions constant, would result in 32 a decrease in our 2023 net periodic pension benefit of approximately $6 million. See Note 21 to the accompanying consolidated financial statements contained in “Part II. Item 8.
A decrease in the expected long-term rate of return of 25 basis points to 4.75%, while holding all other assumptions constant, would result in a decrease in our 2024 net periodic pension benefit of approximately $6 million. See Note 21 to the accompanying consolidated financial statements contained in “Part II. Item 8.
Financial Statements and Supplementary Data” for additional discussion on these assumptions. Results of Operations A discussion of changes in our results of operations during the year ended December 31, 2021 compared to the year ended December 31, 2020 has been omitted from this Annual Report on Form 10-K, but may be found in “Item 7.
Financial Statements and Supplementary Data” for additional discussion on these assumptions. 35 Results of Operations A discussion of changes in our results of operations during the year ended December 31, 2022 compared to the year ended December 31, 2021 has been omitted from this Annual Report on Form 10-K, but may be found in “Item 7.
The expected long-term rate of return on plan assets used to determine net periodic pension benefit for the year ended December 31, 2023 is expected to be 5.00%.
The expected long-term rate of return on plan assets used to determine net periodic pension benefit for the year ended December 31, 2024 is expected to be 5.00%.
A/N and Charter both have the right to terminate or suspend the pro rata repurchase arrangement on a prospective basis. During the years ended December 31, 2022 and 2021, Charter Holdings purchased from A/N 3.2 million and 3.3 million Charter Holdings common units, respectively, for approximately $1.6 billion and $2.2 billion, respectively.
A/N and Charter both have the right to terminate or suspend the pro rata repurchase arrangement on a prospective basis. During the years ended December 31, 2023 and 2022, Charter Holdings purchased from A/N 1.1 million and 3.2 million Charter Holdings common units, respectively, for approximately $427 million and $1.6 billion, respectively.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on January 28, 2022, which is available free of charge on the SEC's website at www.sec.gov and on our investor relations website at ir.charter.com.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on January 27, 2023, which is available free of charge on the SEC's website at www.sec.gov and on Charter's investor relations website at ir.charter.com.
The actual amount of capital expenditures in 2023 will depend on a number of factors including, but not limited to, the pace of our network evolution and rural construction initiatives, supply chain timing and growth rates in our residential and commercial businesses. Our capital expenditures are funded primarily from cash flows from operating activities and borrowings on our credit facility.
The actual amount of capital expenditures in 2024 will depend on a number of factors including, but not limited to, the pace of our network evolution and expansion initiatives, supply chain timing and growth rates in our residential and commercial businesses. Our capital expenditures are funded primarily from cash flows from operating activities and borrowings on our credit facility.
Depreciation and amortization expense decreased by $442 million during the year ended December 31, 2022 compared to the corresponding period in 2021 primarily due to certain assets acquired in acquisitions becoming fully depreciated offset by an increase in depreciation as a result of more recent capital expenditures. Other operating expenses, net.
Depreciation and amortization expense decreased by $207 million during the year ended December 31, 2023 compared to the corresponding period in 2022 primarily due to certain assets acquired in acquisitions becoming fully depreciated offset by an increase in depreciation as a result of more recent capital expenditures. Other operating (income) expense, net.
As of December 31, 2022, Charter had remaining board authority to purchase an additional $414 million of Charter’s Class A common stock and/or Charter Holdings common units, excluding purchases from Liberty Broadband.
As of December 31, 2023, Charter had remaining board authority to purchase an additional $170 million of Charter’s Class A common stock and/or Charter Holdings common units, excluding purchases from Liberty Broadband.
Charter's target leverage of net debt to the last twelve months Adjusted EBITDA remains at 4 to 4.5 times Adjusted EBITDA, and up to 3.5 times Adjusted EBITDA at the Charter Operating first lien level. Our leverage ratio was 4.47 times Adjusted EBITDA as of December 31, 2022.
Charter's target leverage of net debt to the last twelve months Adjusted EBITDA remains at 4 to 4.5 times Adjusted EBITDA, and up to 3.5 times Adjusted EBITDA at the Charter Operating first lien level. Charter's leverage ratio was 4.42 times Adjusted EBITDA as of December 31, 2023.
Excluding purchases from Liberty Broadband discussed below, during the years ended December 31, 2022 and 2021, Charter purchased in the public market approximately 14.5 million and 15.9 million shares, respectively, of Charter Class A common stock for approximately $7.1 billion and $10.9 billion, respectively.
Excluding purchases from Liberty Broadband discussed below, during the years ended December 31, 2023 and 2022, Charter purchased in the public market approximately 6.9 million and 14.5 million shares, respectively, of Charter Class A common stock for approximately $2.7 billion and $7.1 billion, respectively.
In developing the expected long-term rate of return on assets, we considered the current pension portfolio’s composition, past average rate of earnings, and our asset allocation targets. We used a discount rate of 5.46% to determine the December 31, 2022 pension plan benefit obligation.
In developing the expected long-term rate of return on assets, we considered the current pension portfolio’s composition, past average rate of earnings, and our asset allocation targets. We used a discount rate of 4.65% to determine the December 31, 2023 pension plan benefit obligation.
In addition, our accrued liabilities related to capital expenditures increased $553 million and $80 million for the years ended December 31, 2022 and 2021, respectively. 40 The following tables present our major capital expenditures categories in accordance with National Cable and Telecommunications Association (“NCTA”) disclosure guidelines for the years ended December 31, 2022 and 2021.
In addition, our accrued liabilities related to capital expenditures increased $172 million and $553 million for the years ended December 31, 2023 and 2022, respectively. 43 The following tables present our major capital expenditures categories in accordance with National Cable and Telecommunications Association (“NCTA”) disclosure guidelines for the years ended December 31, 2023 and 2022.
Our Advanced WiFi, a managed WiFi service that provides customers an optimized home network while providing greater control of their connected devices with enhanced security and privacy, is available to nearly all Internet customers.
Our Advanced WiFi, a managed WiFi service that provides customers an optimized home network and greater control over connected devices with enhanced security and privacy, is available to all of our Internet customers.
We capitalized direct labor and overhead of $1.8 billion and $1.7 billion for the years ended December 31, 2022 and 2021, respectively. We capitalize direct labor and overhead using standards developed from actual costs and applicable operational data.
We capitalized direct labor and overhead of $2.3 billion and $1.8 billion for the years ended December 31, 2023 and 2022, respectively. We capitalize direct labor and overhead using standards developed from actual costs and applicable operational data.
A decrease in the discount rate of 25 basis points would result in an $83 million increase in our pension plan benefit obligation as of December 31, 2022 and net periodic pension expense recognized in 2022 under our mark-to-market accounting policy.
A decrease in the discount rate of 25 basis points would result in an $80 million increase in our pension plan benefit obligation as of December 31, 2023 and net periodic pension cost recognized in 2023 under our mark-to-market accounting policy.
Net cash used in financing activities decreased $3.1 billion during the year ended December 31, 2022 compared to the year ended December 31, 2021 primarily due to a decrease in the purchase of treasury stock and noncontrolling interest offset by a decrease in the amount by which borrowings of long-term debt exceeded repayments.
Net cash used in financing activities decreased $2.5 billion during the year ended December 31, 2023 compared to the year ended December 31, 2022 primarily due to a decrease in the purchase of treasury stock and noncontrolling interest partly offset by a decrease in the amount by which borrowings of long-term debt exceeded repayments.
Residential Internet customers grew by 275,000 in 2022 compared to 2021. Video revenues consist primarily of revenues from basic and digital video services provided to our residential customers, as well as franchise fees, equipment service fees and video installation revenue.
Residential Internet customers grew by 132,000 in 2023 compared to 2022. Video revenues consist primarily of revenues from video services provided to our residential customers, as well as franchise fees, equipment service fees and video installation revenue.
We continue to invest in our ability to provide a differentiated Internet connectivity experience for our mobile and fixed Internet customers with the availability of over 500,000 out of home WiFi access points across our footprint. In addition, we continue to work towards the construction of our own 5G mobile data-only network leveraging our CBRS PALs.
We continue to invest in our ability to provide a differentiated Internet connectivity experience for our mobile and fixed Internet customers with increasing availability of out-of-home WiFi access points across our footprint. In addition, we continue to work towards the construction of our own 5G mobile data-only network in targeted areas of our footprint leveraging our CBRS Priority Access Licenses.
We recognized net periodic pension benefit of $254 million and $305 million in 2022 and 2021, respectively. Net periodic pension benefit or expense is determined using certain assumptions, including the expected long-term rate of return on plan assets, discount rate and mortality assumptions.
We recognized net periodic pension cost of $216 million in 2023 and net periodic pension benefit of $254 million in 2022. Net periodic pension benefit or cost is determined using certain assumptions, including the expected long-term rate of return on plan assets, discount rate and mortality assumptions.
Over an advanced high-capacity, two-way telecommunications network, we offer a full range of state-of-the-art residential and business services including Spectrum Internet, TV, Mobile and Voice.
Over an advanced communications network, we offer a full range of state-of-the-art residential and business services including Spectrum Internet, TV, Mobile and Voice.
Advertising sales revenues consist primarily of revenues from commercial advertising customers, programmers and other vendors, as well as local cable and advertising on regional sports and news channels. Advertising sales revenues increased $288 million during the year ended December 31, 2022 as compared to the corresponding period in 2021 primarily due to an increase in political revenue.
Advertising sales revenues consist primarily of revenues from commercial advertising customers, programmers and other vendors, as well as local cable and advertising on regional sports and news channels. Advertising sales revenues decreased $331 million during the year ended December 31, 2023 as compared to the corresponding period in 2022 primarily due to a decrease in political revenue.
Charter purchased from Liberty Broadband 6.2 million and 6.1 million shares of Charter Class A common stock for approximately $3.0 billion and $4.2 billion during the years ended December 31, 2022 and 2021, respectively. In January 2023, Charter purchased from Liberty Broadband an additional 0.1 million shares of Charter Class A common stock for approximately $42 million.
Charter purchased from Liberty Broadband 1.0 million and 6.2 million shares of Charter Class A common stock for approximately $394 million and $3.0 billion during the years ended December 31, 2023 and 2022, respectively.
As of December 31, 2021, the accumulated benefit obligation and fair value of plan assets was $3.4 billion and $3.5 billion, respectively, and the net funded asset was recorded as a $114 million noncurrent asset, $4 million current liability and $27 million long-term liability.
As of December 31, 2023, the accumulated benefit obligation and fair value of plan assets was $2.4 billion and $2.6 billion, respectively, and the net funded asset was recorded as a $149 million noncurrent asset, $3 million current liability and $19 million long-term liability.
Financial Statements and Supplementary Data.” Net income attributable to Charter shareholders. Net income attributable to Charter shareholders was $5.1 billion and $4.7 billion for the years ended December 31, 2022 and 2021, respectively, primarily as a result of the factors described above.
Net income attributable to Charter shareholders was $4.6 billion and $5.1 billion for the years ended December 31, 2023 and 2022, respectively, primarily as a result of the factors described above.
Net income attributable to noncontrolling interest for financial reporting purposes represents A/N’s portion of Charter Holdings’ net income based on its effective common unit ownership interest and the preferred dividend of $70 million for the year ended December 31, 2021. For more information, see Note 10 to the accompanying consolidated financial statements contained in “Part II. Item 8.
Net income attributable to noncontrolling interest for financial reporting purposes represents A/N’s portion of Charter Holdings’ net income based on its effective common unit ownership interest. For more information, see Note 10 to the accompanying consolidated financial statements contained in “Part II. Item 8. Financial Statements and Supplementary Data.” Net income attributable to Charter shareholders.
We have availability under our credit facilities of approximately $4.0 billion as of December 31, 2022. 42 (b) In general, the obligors have the right to redeem all of the notes set forth in the above table in whole or in part at their option, beginning at various times prior to their stated maturity dates, subject to certain conditions, upon the payment of the outstanding principal amount (plus a specified redemption premium) and all accrued and unpaid interest.
(b) In general, the obligors have the right to redeem all of the notes set forth in the above table in whole or in part at their option, beginning at various times prior to their stated maturity dates, subject to certain conditions, upon the payment of the outstanding principal amount (plus a specified redemption premium) and all accrued and unpaid interest.
In addition, we continue to evolve and upgrade our network to provide higher Internet speeds and reliability and invest in our products and customer service platforms. We currently offer Spectrum Internet products with speeds up to 1 Gbps across our entire footprint and over the next three years, we plan to upgrade our network to provide multi-gigabit speeds.
We continue to upgrade our network to provide higher Internet speeds and reliability and invest in our products and customer service platforms. We currently offer Spectrum Internet products with speeds up to 1 Gbps across our entire footprint and we are upgrading our network to provide multi-gigabit speeds.
Net cash used in investing activities for the years ended December 31, 2022 and 2021 was $9.1 billion and $7.8 billion, respectively. The increase in cash used was primarily due to an increase in capital expenditures, offset by changes in accrued expenses related to capital expenditures that increased by $473 million. Financing Activities.
Investing Activities. Net cash used in investing activities for the years ended December 31, 2023 and 2022 was $11.1 billion and $9.1 billion, respectively. The increase in cash used was primarily due to an increase in capital expenditures and changes in accrued expenses related to capital expenditures. Financing Activities.
See “—Use of Adjusted EBITDA and Free Cash Flow” for further information on Adjusted EBITDA and free cash flow. Growth in total revenue was primarily due to growth in our residential Internet, mobile and commercial customers, price adjustments and higher advertising sales.
See “—Use of Adjusted EBITDA and Free Cash Flow” for further information on Adjusted EBITDA and free cash flow. Growth in total revenue was primarily due to growth in our residential Internet customers and residential mobile lines partly offset by lower residential video and advertising sales revenues.
In 2022, we also made targeted investments in employee wages and benefits inside of our operations to build employee skill sets and tenure as well as continued to invest in digitization of our customer service platforms and proactive maintenance all with the goal of improving the customer experience, reducing transactions and driving customer growth.
We are also beginning to see operational benefits from the targeted investments we are making in employee wages and benefits to build employee skill sets and tenure, as well as the continued investments in digitization of our customer service platforms and 32 proactive maintenance, all with the goal of improving the customer experience, reducing transactions and driving customer growth and retention.
Years ended December 31, 2022 2021 Growth Revenues $ 54,022 $ 51,682 4.5 % Adjusted EBITDA $ 21,616 $ 20,630 4.8 % Income from operations $ 11,962 $ 10,526 13.6 % Adjusted EBITDA is defined as net income attributable to Charter shareholders plus net income attributable to noncontrolling interest, net interest expense, income taxes, depreciation and amortization, stock compensation expense, other income (expenses), net and other operating (income) expenses, net, such as special charges and (gain) loss on sale or retirement of assets.
Years ended December 31, 2023 2022 Growth Revenues $ 54,607 $ 54,022 1.1 % Adjusted EBITDA $ 21,894 $ 21,616 1.3 % Income from operations $ 12,559 $ 11,962 5.0 % Adjusted EBITDA is defined as net income attributable to Charter shareholders plus net income attributable to noncontrolling interest, net interest expense, income taxes, depreciation and amortization, stock compensation expense, other income (expense), net and other operating (income) expenses, net, such as special charges and (gain) loss on sale or retirement of assets.
Also in 2022, CCO Holdings and CCO Holdings Capital Corp. jointly issued $2.7 billion aggregate principal amount of senior unsecured notes and Charter Operating and Charter Communications Operating Capital Corp. jointly issued $3.5 billion aggregate principal amount of senior secured notes.
In 2023, CCO Holdings and CCO Holdings Capital Corp. jointly issued $1.1 billion aggregate principal amount of senior unsecured notes and Charter Operating and Charter Communications Operating Capital Corp. jointly issued $2.0 billion aggregate principal amount of senior secured notes.
Our debt covenants refer to these expenses as management fees, which fees were in the amount of $1.4 billion and $1.3 billion for the years ended December 31, 2022 and 2021, respectively. 37 A reconciliation of Adjusted EBITDA and free cash flow to net income attributable to Charter shareholders and net cash flows from operating activities, respectively, is as follows (dollars in millions): Years ended December 31, 2022 2021 Net income attributable to Charter shareholders $ 5,055 $ 4,654 Plus: Net income attributable to noncontrolling interest 794 666 Interest expense, net 4,556 4,037 Income tax expense 1,613 1,068 Depreciation and amortization 8,903 9,345 Stock compensation expense 470 430 Other expenses, net 225 430 Adjusted EBITDA $ 21,616 $ 20,630 Net cash flows from operating activities $ 14,925 $ 16,239 Less: Purchases of property, plant and equipment (9,376) (7,635) Change in accrued expenses related to capital expenditures 553 80 Free cash flow $ 6,102 $ 8,684 Liquidity and Capital Resources Overview We have significant amounts of debt.
Our debt covenants refer to these expenses as management fees, which fees were in the amount of $1.4 billion for each of the years ended December 31, 2023 and 2022. 40 A reconciliation of Adjusted EBITDA and free cash flow to net income attributable to Charter shareholders and net cash flows from operating activities, respectively, is as follows (dollars in millions): Years ended December 31, 2023 2022 Net income attributable to Charter shareholders $ 4,557 $ 5,055 Plus: Net income attributable to noncontrolling interest 704 794 Interest expense, net 5,188 4,556 Income tax expense 1,593 1,613 Depreciation and amortization 8,696 8,903 Stock compensation expense 692 470 Other, net 464 225 Adjusted EBITDA $ 21,894 $ 21,616 Net cash flows from operating activities $ 14,433 $ 14,925 Less: Purchases of property, plant and equipment (11,115) (9,376) Change in accrued expenses related to capital expenditures 172 553 Free cash flow $ 3,490 $ 6,102 Liquidity and Capital Resources Overview We have significant amounts of debt and require significant cash to fund principal and interest payments on our debt.
Debt As of December 31, 2022, the accreted value of our total debt was approximately $97.6 billion, as summarized below (dollars in millions): December 31, 2022 Principal Amount Accreted Value (a) Interest Payment Dates Maturity Date (b) CCO Holdings, LLC: 4.000% senior notes due 2023 $ 500 $ 500 3/1 & 9/1 3/1/2023 5.500% senior notes due 2026 750 748 5/1 & 11/1 5/1/2026 5.125% senior notes due 2027 3,250 3,232 5/1 & 11/1 5/1/2027 5.000% senior notes due 2028 2,500 2,479 2/1 & 8/1 2/1/2028 5.375% senior notes due 2029 1,500 1,501 6/1 & 12/1 6/1/2029 6.375% senior notes due 2029 1,500 1,487 3/1 & 9/1 9/1/2029 4.750% senior notes due 2030 3,050 3,043 3/1 & 9/1 3/1/2030 4.500% senior notes due 2030 2,750 2,750 2/15 & 8/15 8/15/2030 4.250% senior notes due 2031 3,000 3,001 2/1 & 8/1 2/1/2031 41 4.750% senior notes due 2032 1,200 1,189 2/1 & 8/1 2/1/2032 4.500% senior notes due 2032 2,900 2,924 5/1 & 11/1 5/1/2032 4.500% senior notes due 2033 1,750 1,730 6/1 & 12/1 6/1/2033 4.250% senior notes due 2034 2,000 1,983 1/15 & 7/15 1/15/2034 Charter Communications Operating, LLC: Senior floating rate notes due 2024 900 901 2/1, 5/1, 8/1 & 11/1 2/1/2024 4.500% senior notes due 2024 1,100 1,098 2/1 & 8/1 2/1/2024 4.908% senior notes due 2025 4,500 4,486 1/23 & 7/23 7/23/2025 3.750% senior notes due 2028 1,000 992 2/15 & 8/15 2/15/2028 4.200% senior notes due 2028 1,250 1,244 3/15 & 9/15 3/15/2028 2.250% senior notes due 2029 1,250 1,241 1/15 & 7/15 1/15/2029 5.050% senior notes due 2029 1,250 1,243 3/30 & 9/30 3/30/2029 2.800% senior notes due 2031 1,600 1,586 4/1 & 10/1 4/1/2031 2.300% senior notes due 2032 1,000 993 2/1 & 8/1 2/1/2032 4.400% senior notes due 2033 1,000 990 4/1 & 10/1 4/1/2033 6.384% senior notes due 2035 2,000 1,985 4/23 & 10/23 10/23/2035 5.375% senior notes due 2038 800 787 4/1 & 10/1 4/1/2038 3.500% senior notes due 2041 1,500 1,483 6/1 & 12/1 6/1/2041 3.500% senior notes due 2042 1,350 1,332 3/1 & 9/1 3/1/2042 6.484% senior notes due 2045 3,500 3,469 4/23 & 10/23 10/23/2045 5.375% senior notes due 2047 2,500 2,506 5/1 & 11/1 5/1/2047 5.750% senior notes due 2048 2,450 2,393 4/1 & 10/1 4/1/2048 5.125% senior notes due 2049 1,250 1,240 1/1 & 7/1 7/1/2049 4.800% senior notes due 2050 2,800 2,797 3/1 & 9/1 3/1/2050 3.700% senior notes due 2051 2,050 2,031 4/1 & 10/1 4/1/2051 3.900% senior notes due 2052 2,400 2,323 6/1 & 12/1 6/1/2052 5.250% senior notes due 2053 1,500 1,479 4/1 & 10/1 4/1/2053 6.834% senior notes due 2055 500 495 4/23 & 10/23 10/23/2055 3.850% senior notes due 2061 1,850 1,810 4/1 & 10/1 4/1/2061 4.400% senior notes due 2061 1,400 1,389 6/1 & 12/1 12/1/2061 3.950% senior notes due 2062 1,400 1,379 6/30 & 12/30 6/30/2062 5.500% senior notes due 2063 1,000 986 4/1 & 10/1 4/1/2063 Credit facilities 13,877 13,823 Varies Time Warner Cable, LLC: 5.750% sterling senior notes due 2031 (c) 755 797 6/2 6/2/2031 6.550% senior debentures due 2037 1,500 1,655 5/1 & 11/1 5/1/2037 7.300% senior debentures due 2038 1,500 1,745 1/1 & 7/1 7/1/2038 6.750% senior debentures due 2039 1,500 1,693 6/15 & 12/15 6/15/2039 5.875% senior debentures due 2040 1,200 1,250 5/15 & 11/15 11/15/2040 5.500% senior debentures due 2041 1,250 1,257 3/1 & 9/1 9/1/2041 5.250% sterling senior notes due 2042 (d) 786 760 7/15 7/15/2042 4.500% senior debentures due 2042 1,250 1,150 3/15 & 9/15 9/15/2042 Time Warner Cable Enterprises LLC: 8.375% senior debentures due 2023 1,000 1,010 3/15 & 9/15 3/15/2023 8.375% senior debentures due 2033 1,000 1,238 7/15 & 1/15 7/15/2033 $ 97,368 $ 97,603 (a) The accreted values presented in the table above represent the principal amount of the debt adjusted for original issue discount or premium at the time of sale, deferred financing costs, and, in regards to debt assumed in acquisitions, fair value premium adjustments as a result of applying acquisition accounting plus the accretion of those amounts to the balance sheet date.
Debt As of December 31, 2023, the accreted value of our total debt was approximately $97.8 billion, as summarized below (dollars in millions): December 31, 2023 Principal Amount Accreted Value (a) Interest Payment Dates Maturity Date (b) CCO Holdings, LLC: 5.500% senior notes due 2026 $ 750 $ 748 5/1 & 11/1 5/1/2026 5.125% senior notes due 2027 3,250 3,236 5/1 & 11/1 5/1/2027 5.000% senior notes due 2028 2,500 2,483 2/1 & 8/1 2/1/2028 5.375% senior notes due 2029 1,500 1,500 6/1 & 12/1 6/1/2029 6.375% senior notes due 2029 1,500 1,488 3/1 & 9/1 9/1/2029 4.750% senior notes due 2030 3,050 3,044 3/1 & 9/1 3/1/2030 4.500% senior notes due 2030 2,750 2,750 2/15 & 8/15 8/15/2030 4.250% senior notes due 2031 3,000 3,001 2/1 & 8/1 2/1/2031 44 7.375% senior notes due 2031 1,100 1,090 3/1 & 9/1 3/1/2031 4.750% senior notes due 2032 1,200 1,190 2/1 & 8/1 2/1/2032 4.500% senior notes due 2032 2,900 2,922 5/1 & 11/1 5/1/2032 4.500% senior notes due 2033 1,750 1,732 6/1 & 12/1 6/1/2033 4.250% senior notes due 2034 2,000 1,984 1/15 & 7/15 1/15/2034 Charter Communications Operating, LLC: Senior floating rate notes due 2024 900 900 2/1, 5/1, 8/1 & 11/1 2/1/2024 4.500% senior notes due 2024 1,100 1,100 2/1 & 8/1 2/1/2024 4.908% senior notes due 2025 4,500 4,491 1/23 & 7/23 7/23/2025 6.150% senior notes due 2026 1,100 1,091 5/10 & 11/10 11/10/2026 3.750% senior notes due 2028 1,000 993 2/15 & 8/15 2/15/2028 4.200% senior notes due 2028 1,250 1,245 3/15 & 9/15 3/15/2028 2.250% senior notes due 2029 1,250 1,243 1/15 & 7/15 1/15/2029 5.050% senior notes due 2029 1,250 1,244 3/30 & 9/30 3/30/2029 2.800% senior notes due 2031 1,600 1,588 4/1 & 10/1 4/1/2031 2.300% senior notes due 2032 1,000 993 2/1 & 8/1 2/1/2032 4.400% senior notes due 2033 1,000 991 4/1 & 10/1 4/1/2033 6.650% senior notes due 2034 900 892 2/1 & 8/1 2/1/2034 6.384% senior notes due 2035 2,000 1,985 4/23 & 10/23 10/23/2035 5.375% senior notes due 2038 800 788 4/1 & 10/1 4/1/2038 3.500% senior notes due 2041 1,500 1,484 6/1 & 12/1 6/1/2041 3.500% senior notes due 2042 1,350 1,332 3/1 & 9/1 3/1/2042 6.484% senior notes due 2045 3,500 3,470 4/23 & 10/23 10/23/2045 5.375% senior notes due 2047 2,500 2,506 5/1 & 11/1 5/1/2047 5.750% senior notes due 2048 2,450 2,394 4/1 & 10/1 4/1/2048 5.125% senior notes due 2049 1,250 1,241 1/1 & 7/1 7/1/2049 4.800% senior notes due 2050 2,800 2,797 3/1 & 9/1 3/1/2050 3.700% senior notes due 2051 2,050 2,032 4/1 & 10/1 4/1/2051 3.900% senior notes due 2052 2,400 2,324 6/1 & 12/1 6/1/2052 5.250% senior notes due 2053 1,500 1,480 4/1 & 10/1 4/1/2053 6.834% senior notes due 2055 500 495 4/23 & 10/23 10/23/2055 3.850% senior notes due 2061 1,850 1,810 4/1 & 10/1 4/1/2061 4.400% senior notes due 2061 1,400 1,389 6/1 & 12/1 12/1/2061 3.950% senior notes due 2062 1,400 1,380 6/30 & 12/30 6/30/2062 5.500% senior notes due 2063 1,000 986 4/1 & 10/1 4/1/2063 Credit facilities 12,413 12,359 Varies Time Warner Cable, LLC: 5.750% sterling senior notes due 2031 (c) 797 836 6/2 6/2/2031 6.550% senior debentures due 2037 1,500 1,648 5/1 & 11/1 5/1/2037 7.300% senior debentures due 2038 1,500 1,735 1/1 & 7/1 7/1/2038 6.750% senior debentures due 2039 1,500 1,685 6/15 & 12/15 6/15/2039 5.875% senior debentures due 2040 1,200 1,249 5/15 & 11/15 11/15/2040 5.500% senior debentures due 2041 1,250 1,257 3/1 & 9/1 9/1/2041 5.250% sterling senior notes due 2042 (d) 828 803 7/15 7/15/2042 4.500% senior debentures due 2042 1,250 1,153 3/15 & 9/15 9/15/2042 Time Warner Cable Enterprises LLC: 8.375% senior debentures due 2033 1,000 1,220 1/15 & 7/15 7/15/2033 $ 97,588 $ 97,777 (a) The accreted values presented in the table above represent the principal amount of the debt adjusted for original issue discount or premium at the time of sale, deferred financing costs, and, in regards to debt assumed in acquisitions, fair value premium adjustments as a result of applying acquisition accounting plus the accretion of those amounts to the balance sheet date.
We also distribute award-winning news coverage and sports programming to our customers through Spectrum Networks. See “Part I. Item 1. Business — Products and Services” for further description of these services, including customer statistics for different services.
We also distribute award-winning news coverage and sports programming to our customers through Spectrum Networks. See “Part I. Item 1. Business — Products and Services” for further description of these services, including customer statistics for different services. During the year ended December 31, 2023, we added 2,474,000 mobile lines and 155,000 Internet customers.
Net cash provided by operating activities decreased $1.3 billion during the year ended December 31, 2022 compared to the year ended December 31, 2021, primarily due to an increase in cash paid for taxes, higher cash paid for interest and the payment of litigation settlements offset by an increase in Adjusted EBITDA of $986 million. Investing Activities.
Net cash provided by operating activities decreased $492 million during the year ended December 31, 2023 compared to the year ended December 31, 2022, primarily due to a negative change in working capital and an increase in cash paid for interest and taxes, partly offset by an increase in Adjusted EBITDA and the payment of litigation settlements in 2022.
The change in other income (expenses), net is attributable to the following (dollars in millions): 2022 compared to 2021 Loss on extinguishment of debt (see Note 8) $ 141 Loss on financial instruments, net (see Note 11) (9) Net periodic pension benefit (cost) (see Note 21) (51) Loss on equity investments, net (see Note 5) 76 $ 157 See Note 15 and the Notes referenced above to the accompanying consolidated financial statements contained in “Item 1.
The change in other income (expense), net is attributable to the following (dollars in millions): 2023 compared to 2022 Gain (loss) on financial instruments, net (see Note 11) $ 140 Net periodic pension benefit (cost) (see Note 21) (470) Loss on equity investments, net (see Note 5) (243) $ (573) See Note 15 and the Notes referenced above to the accompanying consolidated financial statements contained in “Item 1.
Defined benefit pension plans We sponsor qualified and unqualified defined benefit pension plans that provide pension benefits to a majority of employees who were employed by TWC before the merger with TWC.
We recognize interest and penalties accrued on uncertain income tax positions as part of the income tax provision. Defined benefit pension plans We sponsor qualified and unqualified defined benefit pension plans that provide pension benefits to a majority of employees who were employed by TWC before the merger with TWC.
The decrease in video revenues was attributable to the following (dollars in millions): 2022 compared to 2021 Decrease in average residential video customers $ (621) Increase related to rate and product mix changes 451 $ (170) Residential video customers decreased by 719,000 in 2022 compared to 2021.
The decrease in video revenues was attributable to the following (dollars in millions): 2023 compared to 2022 Decrease in average residential video customers $ (981) Decrease related to rate and product mix changes (128) $ (1,109) Residential video customers decreased by 994,000 in 2023 compared to 2022.
Enterprise revenues increased $104 million during the year ended December 31, 2022 as compared to the corresponding period in 2021 primarily due to an increase in Internet PSUs offset by a $16 million one-time benefit incurred during the year ended December 31, 2021 as well as lower wholesale PSUs. Enterprise PSUs increased by 12,000 in 2022 compared to 2021.
Enterprise revenues increased $93 million during the year ended December 31, 2023 as compared to the corresponding period in 2022 primarily due to an increase in Internet PSUs partly offset by lower wholesale PSUs. Enterprise PSUs increased by 19,000 in 2023 compared to 2022.
Since the beginning of its buyback program in September 2016 through the year ended December 31, 2022, Charter has purchased in the public market approximately 149.4 million 38 shares of Class A common stock and Charter Holdings common units for approximately $68.5 billion, including purchases from Liberty Broadband and A/N discussed below.
Since the beginning of its buyback program in September 2016 through the year ended December 31, 2023, Charter has purchased in the public market approximately 158.3 million shares of Class A common stock and Charter Holdings common units for approximately $72.0 billion, including purchases from Liberty Broadband and A/N discussed below. 41 In February 2021, Charter and Liberty Broadband entered into a letter agreement (the “LBB Letter Agreement”).
The decrease in other operating expenses, net was attributable to the following (dollars in millions): 2022 compared to 2021 Special charges, net $ 24 (Gain) loss on sale of assets, net (72) $ (48) For more information, see Note 14 to the accompanying consolidated financial statements contained in “Part II. Item 8. Financial Statements and Supplementary Data.” Interest expense, net.
The change in other operating (income) expense, net was attributable to the following (dollars in millions): 2023 compared to 2022 Special charges, net $ (75) (Gain) loss on disposal of assets, net (259) $ (334) For more information, see Note 14 to the accompanying consolidated financial statements contained in “Part II. Item 8.
In February 2021, Charter and Liberty Broadband entered into a letter agreement (the “LBB Letter Agreement”). The LBB Letter Agreement implements Liberty Broadband’s obligations under the Stockholders Agreement to participate in share repurchases by Charter.
The LBB Letter Agreement implements Liberty Broadband’s obligations under the Stockholders Agreement to participate in share repurchases by Charter.
Capital Expenditures We have significant ongoing capital expenditure requirements. Capital expenditures were $9.4 billion and $7.6 billion for the years ended December 31, 2022 and 2021, respectively. The increase was primarily due to an increase in line extensions and customer premise equipment. The increase in line extensions was primarily due to the rural construction initiative.
Capital Expenditures We have significant ongoing capital expenditure requirements. Capital expenditures were $11.1 billion and $9.4 billion for the years ended December 31, 2023 and 2022, respectively. The increase was primarily due to an increase in line extensions in connection with our subsidized rural construction initiative and continued residential and commercial network expansion.
The following table sets forth the consolidated statements of operations for the periods presented (dollars in millions, except per share data): Year Ended December 31, 2022 2021 Revenues $ 54,022 $ 51,682 Costs and Expenses: Operating costs and expenses (exclusive of items shown separately below) 32,876 31,482 Depreciation and amortization 8,903 9,345 Other operating expenses, net 281 329 42,060 41,156 Income from operations 11,962 10,526 Other Income (Expenses): Interest expense, net (4,556) (4,037) Other income (expenses), net 56 (101) (4,500) (4,138) Income before income taxes 7,462 6,388 Income tax expense (1,613) (1,068) Consolidated net income 5,849 5,320 Less: Net income attributable to noncontrolling interests (794) (666) Net income attributable to Charter shareholders $ 5,055 $ 4,654 EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CHARTER SHAREHOLDERS: Basic $ 31.30 $ 25.34 Diluted $ 30.74 $ 24.47 Weighted average common shares outstanding, basic 161,501,355 183,669,369 Weighted average common shares outstanding, diluted 164,433,596 193,042,948 Revenues.
The following table sets forth the consolidated statements of operations for the periods presented (dollars in millions, except per share data): Year Ended December 31, 2023 2022 Revenues $ 54,607 $ 54,022 Costs and Expenses: Operating costs and expenses (exclusive of items shown separately below) 33,405 32,876 Depreciation and amortization 8,696 8,903 Other operating (income) expense, net (53) 281 42,048 42,060 Income from operations 12,559 11,962 Other Income (Expense): Interest expense, net (5,188) (4,556) Other income (expense), net (517) 56 (5,705) (4,500) Income before income taxes 6,854 7,462 Income tax expense (1,593) (1,613) Consolidated net income 5,261 5,849 Less: Net income attributable to noncontrolling interests (704) (794) Net income attributable to Charter shareholders $ 4,557 $ 5,055 EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CHARTER SHAREHOLDERS: Basic $ 30.54 $ 31.30 Diluted $ 29.99 $ 30.74 Weighted average common shares outstanding, basic 149,208,188 161,501,355 Weighted average common shares outstanding, diluted 151,966,313 164,433,596 Revenues.
For more information, see Note 17 to the accompanying consolidated financial statements contained in “Part II. Item 8. Financial Statements and Supplementary Data.” Net income attributable to noncontrolling interest.
Financial Statements” for more information. Income tax expense. We recognized income tax expense of $1.6 billion for both the years ended December 31, 2023 and 2022 . For more information, see Note 17 to the accompanying consolidated financial statements contained in “Part II. Item 8. Financial Statements and Supplementary Data.” Net income attributable to noncontrolling interest.
We will continue to monitor this deferred tax asset and update the valuation allowance analysis as needed. In determining our tax provision for financial reporting purposes, we establish a reserve for uncertain tax positions unless such positions are determined to be “more likely than not” of being sustained upon examination, based on their technical merits.
In determining our tax provision for financial reporting purposes, we establish a reserve for uncertain tax positions unless such positions are determined to be “more likely than not” of being sustained upon examination, based on their technical merits. There is considerable judgment involved in making such a determination.
Further, in 2022, Charter has become a meaningful federal cash tax payer as the majority of our net operating losses have been utilized. Free cash flow was $6.1 billion and $8.7 billion for the years ended December 31, 2022 and 2021, respectively.
Further, in 2022, Charter became a meaningful federal cash tax payer as the majority of our net operating losses had been utilized. Free cash flow was $3.5 billion and $6.1 billion for the years ended December 31, 2023 and 2022, respectively. See table below for factors impacting free cash flow during the year ended December 31, 2023 compared to 2022.
The increase in our operating costs and expenses, exclusive of items shown separately in the consolidated statements of operations, was attributable to the following (dollars in millions): 2022 compared to 2021 Programming $ (224) Regulatory, connectivity and produced content (191) Costs to service customers 379 Marketing 268 Mobile 896 Other 266 $ 1,394 Programming costs were approximately $11.6 billion and $11.8 billion for the years ended December 31, 2022 and 2021, representing 35% and 38% of total operating costs and expenses, respectively.
The increase in our operating costs and expenses, exclusive of items shown separately in the consolidated statements of operations, was attributable to the following (dollars in millions): 2023 compared to 2022 Programming $ (982) Other costs of revenue 783 Costs to service customers 328 Sales and marketing 68 Other 332 $ 529 Programming costs were approximately $10.6 billion and $11.6 billion for the years ended December 31, 2023 and 2022, representing 32% and 35% of total operating costs and expenses, respectively.
Programming costs consist primarily of costs paid to programmers for basic, digital, premium, video on demand, and pay-per-view programming. Programming costs decreased as a result of fewer customers and a higher mix of lower cost video packages within our video customer base offset by contractual rate adjustments, including renewals and increases in amounts paid for retransmission consent.
Programming costs decreased as a 38 result of a higher mix of lower cost video packages within our video customer base, fewer customers and a $61 million benefit related to the temporary loss of Disney programming during 2023, partly offset by contractual rate adjustments, including renewals and increases in amounts paid for retransmission consent.
In October 2022, we introduced Spectrum One, which brings together Spectrum Internet, Advanced WiFi and Unlimited Spectrum Mobile, to offer consumers fast, reliable and secure online connections on their favorite devices at home and on-the-go in a high-value package which contributed to our increase in mobile lines in the fourth quarter.
Our mobile line and Internet customer additions were supported by our Spectrum One offering, which brings together Spectrum Internet, Advanced WiFi and Unlimited Spectrum Mobile to offer consumers fast, reliable and secure online connections on their favorite devices at home and on-the-go in a high-value package, and were further supported by growth in our legacy and new subsidized rural markets.
(f) The rural construction initiative subcategory includes expenditures associated with our Rural Construction Initiative (for which separate reporting was initiated in 2022), excluding customer premise equipment and installation.
(f) The subsidized rural construction initiative subcategory includes projects for which we are receiving subsidies from federal, state and local governments (for which separate reporting was initiated in 2022), excluding customer premise equipment and installation.
Net interest expense increased by $519 million in 2022 from 2021 primarily due to an increase in weighted average debt outstanding of approximately $8.3 billion as well as an increase in weighted average interest rates. The increase in weighted average debt outstanding is primarily due to the issuance of notes throughout 2021 and 2022. 36 Other income (expenses), net.
Financial Statements and Supplementary Data.” Interest expense, net. Net interest expense increased by $632 million in 2023 from 2022 primarily due to an increase in weighted average interest rates as well as an increase in weighted average debt outstanding of approximately $2.2 billion. 39 Other income (expense), net.
Financial Statements and Supplementary Data.” Historical Operating, Investing, and Financing Activities Cash and Cash Equivalents. We held $645 million and $601 million in cash and cash equivalents as of December 31, 2022 and 2021, respectively. Operating Activities.
We held $709 million and $645 million in cash and cash equivalents as of December 31, 2023 and 2022, respectively. Operating Activities.
Adjusted EBITDA growth and changes in income from operations were impacted by growth in revenue and increases in operating costs and expenses, primarily mobile, costs to service customers and marketing.
Adjusted EBITDA and income from operations growth was driven by growth in revenue and increases in operating costs and expenses, primarily mobile device and other mobile direct costs and costs to service customers, partly offset by a decrease in programming expense.
Other revenues increased approximately $34 million during the year ended December 31, 2022 as compared to the corresponding period in 2021 primarily due to subsidy revenue related to our rural construction initiative and an increase in processing fees offset by a decrease in sales of video devices. Operating costs and expenses .
Other revenues increased approximately $623 million during the year ended December 31, 2023 as compared to the corresponding period in 2022 primarily due to higher mobile device sales partially offset by lower processing fees. Operating costs and expenses .
We expect to utilize free cash flow, cash on hand and availability under our credit facilities as well as future refinancing transactions to further extend the maturities of our obligations. The timing and terms of any refinancing transactions will be subject to market conditions among other considerations.
As of December 31, 2023, the amount available under our credit facilities was approximately $5.2 billion and cash on hand was approximately $709 million. We expect to utilize free cash flow, cash on hand and availability under our credit facilities as well as future refinancing transactions to further extend the maturities of our obligations.
Total revenues grew $2.3 billion or 4.5% during the year ended December 31, 2022 as compared to 2021 primarily due to increases in the number of residential Internet, mobile and commercial customers, price adjustments and higher advertising sales. 33 Revenues by service offering were as follows (dollars in millions; all percentages are calculated using whole numbers; minor differences may exist due to rounding): Years ended December 31, 2022 2021 Growth Internet $ 22,222 $ 21,094 5.3 % Video 17,460 17,630 (1.0) % Voice 1,559 1,598 (2.5) % Residential revenue 41,241 40,322 2.3 % Small and medium business 4,301 4,170 3.1 % Enterprise 2,677 2,573 4.0 % Commercial revenue 6,978 6,743 3.5 % Advertising sales 1,882 1,594 18.1 % Mobile 3,042 2,178 39.7 % Other 879 845 4.0 % $ 54,022 $ 51,682 4.5 % The increase in Internet revenues from our residential customers was attributable to the following (dollars in millions): 2022 compared to 2021 Increase related to rate and product mix changes $ 634 Increase in average residential Internet customers 494 $ 1,128 The increase related to rate and product mix was primarily due to promotional roll-off and rate adjustments.
Total revenues grew $585 million or 1.1% during the year ended December 31, 2023 as compared to 2022 primarily due to growth in residential Internet revenue, mobile device sales and residential mobile service revenues partly offset by lower residential video and advertising sales revenues as well as $68 million of total customer credits related to the temporary loss of Disney programming during 2023. 36 Revenues by service offering were as follows (dollars in millions; all percentages are calculated using whole numbers; minor differences may exist due to rounding): Years ended December 31, 2023 2022 Growth Internet $ 23,032 $ 22,222 3.6 % Video 16,351 17,460 (6.4) % Voice 1,510 1,559 (3.1) % Mobile service 2,243 1,698 32.1 % Residential revenue 43,136 42,939 0.5 % Small and medium business 4,353 4,350 0.1 % Enterprise 2,770 2,677 3.5 % Commercial revenue 7,123 7,027 1.4 % Advertising sales 1,551 1,882 (17.6) % Other 2,797 2,174 28.7 % $ 54,607 $ 54,022 1.1 % The increase in Internet revenues from our residential customers was attributable to the following (dollars in millions): 2023 compared to 2022 Increase related to rate and product mix changes $ 632 Increase in average residential Internet customers 178 $ 810 The increase related to rate and product mix was primarily due to promotional rate step-ups and rate adjustments, partly offset by lower bundled revenue allocation.
In evaluating the need for a valuation allowance, management takes into account various factors, including the expiration date (if any) of such carryforwards, the expected level of future taxable income, available tax planning strategies and reversals of existing taxable temporary differences.
Valuation allowances are established when management determines that it is more likely than not that some portion or the entire deferred tax asset will not be realized. In evaluating the need for a valuation allowance, management takes into account various factors, including the expected level of future taxable income, available tax planning strategies and reversals of existing taxable temporary differences.
(c) Principal amount includes £625 million valued at $755 million as of December 31, 2022 using the exchange rate as of December 31, 2022. (d) Principal amount includes £650 million valued at $786 million as of December 31, 2022 using the exchange rate as of December 31, 2022. In 2022, Charter Operating entered into an amendment to its credit agreement.
(c) Principal amount includes £625 million valued at $797 million as of December 31, 2023 using the exchange rate as of December 31, 2023. (d) Principal amount includes £650 million valued at $828 million as of December 31, 2023 using the exchange rate as of December 31, 2023.
The principal amount of our debt as of December 31, 2022 was $97.4 billion, consisting of $13.9 billion of credit facility debt, $56.8 billion of investment grade senior secured notes and $26.7 billion of high-yield senior unsecured notes. Our business requires significant cash to fund principal and interest payments on our debt.
The principal amount of our debt as of December 31, 2023 was $97.6 billion, consisting of $12.4 billion of credit facility debt, $57.9 billion of investment grade senior secured notes and $27.3 billion of high-yield senior unsecured notes. Our split credit rating allows us to access both the investment grade debt market and the high yield debt market.
These disclosure guidelines are not required disclosures under GAAP, nor do they impact our accounting for capital expenditures under GAAP (dollars in millions): Year ended December 31, 2022 2021 Customer premise equipment (a) $ 2,209 $ 1,967 Scalable infrastructure (b) 1,791 1,677 Line extensions (c) 2,990 1,642 Upgrade/rebuild (d) 845 706 Support capital (e) 1,541 1,643 Total capital expenditures $ 9,376 $ 7,635 Capital expenditures included in total related to: Capital expenditures, excluding line extensions $ 6,386 $ 5,993 Line extensions (c) 2,990 1,642 Total capital expenditures $ 9,376 $ 7,635 Of which: Commercial services $ 1,511 $ 1,445 Of which: Mobile $ 376 $ 482 Of which: Rural construction initiative (f) $ 1,791 $ — (a) Customer premise equipment includes costs incurred at the customer residence to secure new customers and revenue generating units, including customer installation costs and customer premise equipment (e.g., digital receivers and cable modems).
These disclosure guidelines are not required disclosures under GAAP, nor do they impact our accounting for capital expenditures under GAAP (dollars in millions): Year Ended December 31, 2023 2022 Customer premise equipment (a) $ 2,286 $ 2,207 Scalable infrastructure (b) 1,368 1,711 Upgrade/rebuild (c) 1,719 938 Support capital (d) 1,727 1,533 Capital expenditures, excluding line extensions 7,100 6,389 Subsidized rural construction line extensions 1,822 1,436 Other line extensions 2,193 1,551 Total line extensions (e) 4,015 2,987 Total capital expenditures $ 11,115 $ 9,376 Of which: Commercial services $ 1,560 $ 1,511 Subsidized rural construction initiative (f) $ 1,870 $ 1,504 Mobile $ 314 $ 376 (a) Customer premise equipment includes equipment and devices located at the customer's premise used to deliver our Internet, video and voice services (e.g., modems, routers and set-top boxes), as well as installation costs.
We spent $1.8 billion on our rural construction initiative during the year ended December 31, 2022. We expect that over time, our rural construction initiative will support customer growth and in 2022, we constructed over 200,000 rural passings.
We spent $1.9 billion on our subsidized rural construction initiative during the year ended December 31, 2023 and activated approximately 295,000 subsidized rural passings.
By continually improving our product set and offering consumers the opportunity to save money by switching to our services, we believe we can continue to penetrate our expanding footprint and attract more spend on additional products for our existing customers. 29 In June 2022, we entered into a joint venture with Comcast to develop and offer a next-generation streaming platform, Xumo, on a variety of streaming devices and smart TVs.
By continually improving our product set and offering consumers the opportunity to save money by switching to our services, we believe we can continue to penetrate our expanding footprint and sell additional products to our existing customers.
(b) Scalable infrastructure includes costs not related to customer premise equipment, to secure growth of new customers and revenue generating units, or provide service enhancements (e.g., headend equipment). (c) Line extensions include network costs associated with entering new service areas (e.g., fiber/coaxial cable, amplifiers, electronic equipment, make-ready and design engineering).
(b) Scalable infrastructure includes costs, not related to customer premise equipment or our network, to secure growth of new customers or provide service enhancements (e.g., headend equipment). (c) Upgrade/rebuild includes costs to modify or replace existing fiber/coaxial cable networks, including our network evolution initiative which started in 2022.
The increase in other expense was attributable to the following (dollars in millions): 2022 compared to 2021 Advertising sales expense $ 84 Corporate costs 78 Enterprise 43 Stock compensation expense 40 Other 21 $ 266 Advertising sales expense increased during the year ended December 31, 2022 compared to the corresponding prior period due to higher costs of sales fees driven by higher political revenue.
The increase in other expense was attributable to the following (dollars in millions): 2023 compared to 2022 Stock compensation expense $ 222 Corporate costs 84 Costs to sell and service bulk properties 48 Enterprise 24 Property tax and insurance (35) Other (11) $ 332 Stock compensation expense increased during the year ended December 31, 2023 compared to the corresponding prior period primarily due to an increase in equity awards granted.
(d) Upgrade/rebuild includes costs to modify or replace existing fiber/coaxial cable networks, including betterments. (e) Support capital includes costs associated with the replacement or enhancement of non-network assets due to technological and physical obsolescence (e.g., non-network equipment, land, buildings and vehicles).
(d) Support capital includes costs associated with the replacement or enhancement of non-network assets (e.g., back-office systems, non-network equipment, land and buildings, vehicles, tools and test equipment). (e) Line extensions include network costs associated with entering new service areas (e.g., fiber/coaxial cable, amplifiers, electronic equipment, make-ready and design engineering).
See the table below for more details. We currently expect full year 2023 capital expenditures, excluding line extensions, to be between $6.5 billion and $6.8 billion. We expect 2023 line extensions capital expenditures to approximate $4 billion.
We currently expect full year 2024 capital expenditures to total between $12.2 billion and $12.4 billion, including line extensions of approximately $4.5 billion and network evolution spend of approximately $1.6 billion.
Free Cash Flow Free cash flow decreased $2.6 billion during the year ended December 31, 2022 compared to the corresponding prior period due to the following (dollars in millions): 2022 compared to 2021 Increase in capital expenditures $ (1,741) Increase in cash paid for taxes, net (1,168) Increase in cash paid for interest, net (460) Increase in Adjusted EBITDA 986 Change in working capital, excluding change in accrued interest and taxes 188 Other, net (387) $ (2,582) Free cash flow was reduced by $1.1 billion and $853 million during the years ended December 31, 2022 and 2021, respectively, due to mobile impacts negatively affecting working capital, capital expenditures and Adjusted EBITDA.
Recent Events In January and February 2024, Charter Operating and Charter Communications Operating Capital Corp. redeemed all of their outstanding senior secured floating rate notes due 2024 and paid in full all of their outstanding 4.500% senior secured notes due 2024 at maturity. 42 Free Cash Flow Free cash flow decreased $2.6 billion during the year ended December 31, 2023 compared to the corresponding prior period due to the following (dollars in millions): 2023 compared to 2022 Increase in capital expenditures $ (1,739) Changes in working capital, excluding mobile devices (772) Increase in cash paid for interest, net (495) Changes in working capital, mobile devices (184) Increase in cash paid for taxes, net (108) Increase in Adjusted EBITDA 278 Other, net 408 $ (2,612) Historical Operating, Investing, and Financing Activities Cash and Cash Equivalents.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThe interest rate on approximately 85% and 87% of the total principal amount of our debt was fixed as of December 31, 2022 and 2021, respectively. 43 The table set forth below summarizes the fair values and contract terms of financial instruments subject to interest rate risk maintained by us as of December 31, 2022 (dollars in millions): 2023 2024 2025 2026 2027 Thereafter Total Fair Value Debt: Fixed Rate $ 1,500 $ 1,100 $ 4,500 $ 750 $ 3,250 $ 71,491 $ 82,591 $ 68,427 Average Interest Rate 6.92 % 4.50 % 4.91 % 5.50 % 5.13 % 4.92 % 4.96 % Variable Rate $ 390 $ 1,290 $ 2,661 $ 366 $ 9,707 $ 363 $ 14,777 $ 14,371 Average Interest Rate 6.15 % 5.57 % 4.99 % 4.50 % 4.68 % 4.73 % 4.85 % Interest rates on variable-rate debt are estimated using the average implied forward LIBOR or SOFR for the year of maturity based on the yield curve in effect at December 31, 2022 including applicable bank spread.
Biggest changeThe interest rate on approximately 86% and 85% of the total principal amount of our debt was fixed as of December 31, 2023 and 2022, respectively. 46 The table set forth below summarizes the fair values and contract terms of financial instruments subject to interest rate risk maintained by us as of December 31, 2023 (dollars in millions): 2024 2025 2026 2027 2028 Thereafter Total Fair Value Debt: Fixed Rate $ 1,100 $ 4,500 $ 1,850 $ 3,250 $ 4,750 $ 68,825 $ 84,275 $ 74,592 Average Interest Rate 4.50 % 4.91 % 5.89 % 5.13 % 4.53 % 5.01 % 4.99 % Variable Rate $ 1,290 $ 700 $ 387 $ 7,939 $ 390 $ 2,607 $ 13,313 $ 13,137 Average Interest Rate 6.26 % 4.82 % 4.41 % 4.54 % 4.74 % 5.40 % 4.89 % Interest rates on variable-rate debt are estimated using the average implied forward SOFR for the year of maturity based on the yield curve in effect at December 31, 2023 including applicable bank spread.
The fair value of our cross-currency derivatives included in other long-term liabilities on our consolidated balance sheets was $570 million and $290 million as of December 31, 2022 and 2021, respectively. For more information, see Note 11 to the accompanying consolidated financial statements contained in “Part II. Item 8.
The fair value of our cross-currency derivatives included in other long-term liabilities on our consolidated balance sheets was $440 million and $570 million as of December 31, 2023 and 2022, respectively. For more information, see Note 11 to the accompanying consolidated financial statements contained in “Part II. Item 8.
Financial Statements and Supplementary Data.” As of December 31, 2022 and 2021, the weighted average interest rate on the credit facility debt was approximately 5.9% and 1.6%, respectively, and the weighted average interest rate on the senior notes was approximately 5.0% and 4.9%, respectively, resulting in a blended weighted average interest rate of 5.1% and 4.5%, respectively.
Financial Statements and Supplementary Data.” As of December 31, 2023 and 2022, the weighted average interest rate on the credit facility debt was approximately 7.0% and 5.9%, respectively, and the weighted average interest rate on the senior notes was approximately 5.0% and 5.0%, respectively, resulting in a blended weighted average interest rate of 5.3% and 5.1%, respectively.

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