Cable One NYSE: CABO management said early operational changes are moving in the “right direction” but have not yet shown up consistently in results, as the company continues to face elevated churn in its most competitive markets and pressure on residential revenue.
“Results reflect the broader economic backdrop and continued pressure in our more competitive markets, particularly in customer retention,” CEO Jim Holanda said on the company’s first quarter 2026 earnings call. Holanda, who said he has been in the CEO role for a little over 70 days, emphasized that retention is “the primary challenge,” while pointing to improved connects and early signs of traction from new initiatives.
Q1 financial results: revenue down year over year, cash flow remains sizable
CFO Todd Koetje reported total revenue of $353 million for the first quarter of 2026, down from $380.6 million in the prior-year quarter. Koetje attributed the year-over-year decline primarily to lower residential video and residential data revenue.
Koetje said residential video accounted for “approximately $10 million” of the decrease, while residential data revenue fell $11.6 million, or 5.1%, due primarily to a 6.1% decline in subscribers. Business data revenue decreased $1 million, or 1.8%, year over year.
On profitability, Cable One posted adjusted EBITDA of $183.3 million, or 51.9% of revenue, versus $202.7 million, or 53.3%, a year earlier. Capital expenditures totaled $68.4 million, down 3.8% year over year, including $5.1 million tied to new market expansion projects. Koetje said the company remains on track for full-year CapEx to be in line with 2025 levels.
Holanda said the company generated approximately $115 million of free cash flow in the quarter and $500 million over the past four quarters, framing that as supporting both debt reduction and investment flexibility.
Residential: customer losses, higher churn in competitive markets, ARPU expected to be “broadly stable”
Holanda said Cable One reported 12,600 net residential broadband customer losses sequentially in the first quarter. He said churn was elevated but “remained primarily concentrated within our more competitive markets,” which he said represent about 15% of the company’s footprint.
Holanda highlighted that first quarter connects improved year over year, calling it an early indication that “elements of our strategy are beginning to gain traction.” In response to analyst questions, he attributed the connect improvement to both channel performance and offer strategy, including expansion in direct sales, improved e-commerce results, and “very targeted segmented offers,” including price locks in hyper-competitive markets.
On ARPU, Holanda said the quarter reflected “downward pressure from go-to-market initiatives and targeted retention offers,” partially offset by higher speed tier “sell-in” and broader multi-product offerings. Despite potential quarter-to-quarter variability, he said the company continues to expect ARPU trends to remain “broadly stable for the year.”
Asked about longer-term back-book pricing, Holanda said he believes “overall in the $2-$5 range over time” is “realistic and doable,” citing value-added services and speed enhancements. Koetje added that Cable One historically has not operated with as wide a front-book/back-book gap as some peers, describing the company’s prior approach as more “one size fits all.”
Holanda outlined retention-related initiatives the company is implementing, including:
- Speed upgrades
- More gradual “stepped” promotional roll-offs
- AI-driven tools
- A new CRM platform expected to go live later this year
- Deeper multi-product relationships, including mobile, whole-home Wi-Fi, online security, and technical support
Mobile rollout and network upgrades
Holanda said the company is roughly two months into its “MSO-wide mobile launch,” noting it is too early to draw conclusions about retention or lifetime value, but that “initial customer response has been encouraging.” He said management believes mobile “can become an important component of the broader relationship over time.”
On network capabilities, Holanda said about 53% of Cable One’s markets are currently multi-gig capable and the company expects to expand that capability to “most markets by year-end.”
Business services: early execution changes and a tower-related asset sale
Holanda said business services performance improved through the “back half” of the quarter, citing steps taken under Ed Butler, who has led the business services organization since early January. Holanda said targeted investments in sales enablement, go-to-market discipline, and a new sales training program showed improved results across fiber, carrier, and enterprise channels.
Koetje also discussed the sale of certain fiber-to-the-tower contract rights completed in mid-March for $42 million in cash, resulting in a $26.6 million gain. He said the contracts generated $9 million of business data revenue in 2025 and $2.1 million in the first quarter of 2026, and that the sale reduced first-quarter business data revenue by about $300,000. Asked about EBITDA impact, Koetje said the revenue multiple was “high single-digit,” with margins “slightly higher than what you see from an enterprise side,” which he said should help investors estimate the cash flow impact.
Koetje said results were also modestly impacted by lower revenue from EchoStar as it continues decommissioning portions of its 5G network build-out, representing about $50,000 in the quarter and roughly $200,000 on an annualized basis. He said the company believes this represents “substantially all” of its remaining exposure to that activity.
Debt reduction, refinancing planning, and MBI transaction updates
Koetje said Cable One repaid its $575 million convertible notes at maturity in March using a $575 million revolver draw. During the quarter, the company paid down $90.6 million of debt, including $86.1 million of voluntary repayments. Koetje said Cable One repurchased $33.7 million of senior notes and $27.4 million of term loans “at very attractive discounts,” and also repaid $25 million on its revolver at quarter end.
As of March 31, Cable One had $165.6 million of cash and equivalents and total debt of about $3.1 billion. Koetje said the company had $700 million of undrawn capacity under its $1.25 billion revolving credit facility, and that net leverage on a last-quarter annualized basis was 4.0x.
On the pending acquisition of MBI, Koetje said the purchase consideration remains “locked in” at $480, and said MBI’s first quarter net adds were “south of 2,000,” meaning it lost about 2,000 customers—an improvement from last year’s run rate, according to Koetje. He added the company updated the anticipated debt it expects to assume or refinance in connection with the transaction to a range of $895 million to $925 million, slightly higher than previously discussed due to MBI’s performance last year and lower expected free cash flow between now and closing.
Koetje said Cable One has sufficient liquidity to complete the MBI acquisition, which is expected to close “at the beginning of Q4.” He also said the merger of strategic investments Point Broadband and Clearwave Fiber remains on track to close during Q2, subject to customary conditions.
In Q&A, management also discussed competition from fixed wireless access (FWA) and satellite broadband. Holanda said about 80% of the company’s footprint now has “one or more FWA competitor,” based on Opensignal data. He said the company has not seen “a whole lot of incremental expansion” from Verizon’s FWA in its data, while continuing to see “slow and steady” deployment from T-Mobile and AT&T, later characterizing it as “consistent.” Koetje said the company’s longer-term view is that wired broadband comprises “more of that 80% area,” with the remaining 20% split among wireless-only, mobile FWA, or satellite.
About Cable One NYSE: CABO
Cable One, Inc NYSE: CABO is an American provider of broadband communications services, offering a suite of residential and business solutions over a hybrid fiber-coaxial network. The company delivers high-speed internet access, digital video, voice communications and mobile services, alongside advanced managed Wi-Fi and cybersecurity tools. Cable One's infrastructure supports both traditional cable offerings and converged IP-based platforms designed to meet evolving customer needs.
In addition to consumer-focused services, Cable One caters to small and medium-sized enterprises with dedicated business-class connectivity, Ethernet solutions and cloud-based voice applications.
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