Charter Communications said Friday that its new consumer wireless service, Spectrum Mobile, added 208,000 lines in the second quarter, bringing it to 518,000 lines since launching at the end of June of last year.
The service also generated $158 million in revenue in Q2, up from $140 million in the first quarter. Spectrum Mobile is on track to generate at least $600 million in revenue this year, Charter said.
Expenses from the mobile operation totaled $277 million in Q2, slightly up over $260 million in the first quarter as Charter ramps up marketing for the service. The adjusted EBITDA loss for mobile was $119 million during the quarter.
(Seeking Alpha has Charter’s complete Q2 slide deck here.)
Spectrum Mobile wasn’t in the market in the second quarter of 2018, so there’s no direct year-over-year figure to compare that loss to.
Notably, however, Comcast, which partners its Xfinity Mobile service with Spectrum Mobile for key operations, and also bases its platform on a very similar MVNO agreement with Verizon, reported an EBITDA loss on mobile of $185 million in Q2 2018—that was also just under a year after launch.
Both Comcast and Charter have said their respective mobile services will reach profitability when the percentage of their customers taking mobile service reaches mid to high single digits.
MoffettNathanson analyst Craig Moffett said in his report on Charter Friday that he remains “skeptical” that Comcast and Charter’s Verizon MVNO model will ever be profitable.
However, with Comcast revealing narrowing Xfinity Mobile losses in its own Q2 earnings report Thursday, “the worst of the losses will be felt this year, and then should begin to moderate as the business reaches something closer to steady state.”