Charter Communications CHTR · USD

Mergers and AcquisitionsOn May 16, 2025, Charter, Charter Holdings, and Cox Enterprises, Inc. (“Cox Enterprises”) entered into a Transaction Agreement (the “Transaction Agreement”) pursuant to which (i) Cox Enterprises will sell and transfer to Charter 100% of the equity interests of certain subsidiaries of Cox Communications, Inc. (“Cox Communications”) that conduct Cox Communications’ commercial fiber and managed IT and cloud services businesses (the “Equity Sale”), (ii) Cox Enterprises will contribute the equity interests of Cox Communications and certain other assets (other than certain excluded assets) primarily related to Cox Communications’ residential cable business to Charter Holdings (the “Contribution”), and (iii) Cox Enterprises will pay $1.00 to Charter (collectively, the “Cox Transactions”). Under the Transaction Agreement, Charter and Cox Enterprises may designate one or more wholly owned subsidiaries to take actions with respect to Charter and Cox Enterprises, respectively.Pursuant to the Transaction Agreement, at the closing of the Transaction:•in consideration of the Equity Sale, Charter will pay $3.5 billion in cash to Cox Enterprises;•in consideration of the Contribution, Charter Holdings will (i) pay to Cox Enterprises $500 million in cash and (ii) issue to Cox Enterprises convertible preferred units of Charter Holdings with an aggregate liquidation preference of $6.0 billion, which will pay a 6.875% dividend per annum, and approximately 33.6 million Charter Holdings common units. The Charter Holdings convertible preferred units will be convertible into Charter Holdings common units, with an initial conversion price of $477.41, subject to certain adjustments. The Charter Holdings common units will be exchangeable by the holder, in certain circumstances, for cash or, at the election of Charter, Charter Class A common stock on a one-for-one basis, subject to certain adjustments; and•in consideration of the $1.00 payment from Cox Enterprises to Charter, Charter will issue to Cox Enterprises one share of the newly created Charter Class C common stock. The Charter Class C common stock will be equivalent, economically, to the outstanding Charter Class A common stock and the Charter Class B common stock but will have a number of votes per share that reflect the voting power of the Charter Holdings common units and the Charter Holdings convertible preferred units held by Cox Enterprises on an as-converted, as-exchanged basis.

Cybersecurity risks are classified as a Tier 1 risk within our enterprise risk management program. We are committed to protecting the security and integrity of our systems, networks, databases and applications. We routinely invest to develop and implement numerous cybersecurity programs and processes, including risk management and assessment programs, security and event monitoring capabilities, detailed incident response plans, and other advanced detection, prevention and protection capabilities, including practices and tools to monitor and mitigate insider threats. We regularly assess cybersecurity risks to identify and enumerate threats to us and vulnerabilities these threats can exploit to adversely impact our business operations. Regular reviews of these risks and vulnerabilities drive our investment in new controls and technologies. In some instances, we engage third parties to conduct or assist us with conducting cybersecurity risk assessments.Our cybersecurity program employs various risk-tracking tools, industry data, monitoring, detection and response tools, vulnerability scanning, security dashboards and scorecards and other tools to support our continued evaluation of cybersecurity threats and regulatory requirements. Our cybersecurity program addresses the continuously evolving and extensive attack vectors and methods through layered security controls informed by constant threat analysis. Threats include a wide variety of perpetrators aiming for political, personal or financial gain, utilizing a broad set of tactics including ransomware, advanced malware, DDoS, account takeover, phishing/SMSing, sabatoge and social engineering, among others. These risks threaten our internal systems as well as third-party systems that we use and rely upon for the delivery of services and support of our operations. Our risk mitigation techniques include least privileged access, network segmentation, deployment of enhanced detection tools across our network, systems, databases, and applications and monitoring compliance with security standards all based on a risk-based approach. Various security standards provide guidance to telecommunications companies in order to help identify and mitigate cybersecurity risks, including the voluntary framework released by the National Institute for Standards and Technology (“NIST”) in 2014 and updated in 2018 and 2024, in cooperation with other federal agencies and owners and operators of U.S. critical infrastructure.

Accounting for Derivative Instruments and Hedging ActivitiesCross-currency derivative instruments are used to manage foreign exchange risk on the Sterling Notes by effectively converting £1.275 billion aggregate principal amount of fixed-rate British pound sterling denominated debt, including annual interest payments and the payment of principal at maturity, to fixed-rate U.S. dollar denominated debt. The cross-currency swaps have maturities of June 2031 and July 2042. The Company’s derivative instruments are not designated as hedges and are marked to fair value each period, with the impact recorded as a gain or loss on financial instruments in the consolidated statements of operations in other expenses, net. While these derivative instruments are not designated as hedges for accounting purposes, management continues to believe such instruments are closely correlated with the respective debt, thus managing associated risk. The fair value of the Company's cross-currency derivatives, which are classified within Level 2 of the valuation hierarchy, was $406 million and $504 million and is included in other long-term liabilities on its consolidated balance sheets as of December 31, 2025 and 2024, respectively. The effect of financial instruments are recorded in other expenses, net in the consolidated statements of operations and consisted of the following. Year Ended December 31,202520242023Change in fair value of cross-currency derivative instruments $96 $(64)$130 Foreign currency remeasurement of Sterling Notes to U.S.

Accounts Payable, Accrued and Other Current LiabilitiesAccounts payable, accrued and other current liabilities consist of the following as of December 31, 2025 and 2024: December 31,20252024Accounts payable – trade$1,034 $880 Deferred revenue422 456 Accrued and other current liabilities:Programming costs1,575 1,576 Labor1,365 1,365 Capital expenditures3,296 2,906 Interest1,259 1,208 Taxes and regulatory fees521 649 Short-term borrowings918 758 Other2,166 1,889 $12,556 $11,687 Under a supply chain finance (“SCF”) program, the Company has agreements with third parties that allow its participating vendors to finance payment obligations from the Company with designated third-party financial institutions who act as its paying agent. The Company has generally extended its payment terms with vendors. A participating vendor may request a participating financial institution to finance one or more of the Company's payment obligations to such vendor prior to the scheduled due date thereof at a discounted price. The Company is not required to provide collateral to the financial institutions. The Company's obligations to participating vendors, including amounts due and scheduled payment dates, are not impacted by the vendors’ decisions to finance amounts due under these financing arrangements. Cash outflows to the financial institutions are classified as cash flows from operating and investing activities.A rollforward of the Company's outstanding payment obligations to participating vendors under its SCF program is summarized as follows for the years ended December 31, 2025 and 2024 and are included in accounts payable - trade and accrued capital expenditures in the table above: Year Ended December 31,20252024Balance, beginning of period$576 $— Obligations confirmed during the year2,881 1,454 Obligations paid during the year(2,722)(878)Balance, end of period$735 $576 Under a deferred payment program, the Company has agreements with third parties to pay certain invoices when due, and the Company pays the third parties at a later date, the invoice amount plus interest. Cash outflows to the financial institutions are classified as cash flows from financing activities.

Equipment Installment Plan Financing FacilityCCO EIP Financing, LLC (the “SPV Borrower”), a bankruptcy remote special purpose vehicle and consolidated subsidiary of the Company, is the borrower of a senior secured revolving credit facility to finance the purchase of equipment installment plan receivables (“EIP Receivables”) with a number of financial institutions (the “EIP Financing Facility”). The revolving credit facility under the EIP Financing Facility bears interest on the outstanding borrowings based on lenders’ cost of funds plus an applicable margin and was 5.14% and 5.78% as of December 31, 2025 and 2024, respectively. In November 2025, the revolving credit facility under the EIP Financing Facility was amended to extend the maturity date and increase borrowing capacity to $2.0 billion, among other amendments. The EIP Financing Facility has a final maturity date of November 3, 2029, comprised of a twelve-month revolving loan period subject to renewal, and if not renewed, cash flows on EIP Receivables are applied to amortize the loan which may occur over a period of up to three years. As of December 31, 2025 and 2024, the carrying value of the EIP Financing Facility was $1.4 billion and $1.1 billion, respectively, and is included in the Company’s consolidated balance sheets. The SPV Borrower’s sole business consists of the purchase or acceptance through capital contributions of the EIP Receivables from Spectrum Mobile Equipment, LLC, (the sole direct parent entity of SPV Borrower that originates the EIP Receivables) and the subsequent retransfer of or granting of a security interest in such EIP Receivables to the administrative agent under the EIP Financing Facility. The SPV Borrower is a separate legal entity with its own separate creditors who will be entitled, upon its liquidation, to be satisfied out of the SPV Borrower’s assets prior to any assets or value in the SPV Borrower becoming available to the SPV Borrower’s equity holders, and the assets of the SPV Borrower are not available to pay creditors of any other affiliate of the Company. The EIP Financing Facility is accounted for on a consolidated basis as a secured borrowing. As of December 31, 2025 and 2024, pledged EIP Receivables with an unpaid principal balance of $2.2 billion and $1.

Franchises, Goodwill and Other Intangible AssetsFranchise rights represent the value attributed to agreements or authorizations with local and state authorities that allow access to homes in cable service areas. For valuation purposes, they are defined as the future economic benefits of the right to solicit and service potential customers (customer marketing rights), and the right to deploy and market new services to potential customers (service marketing rights). Management estimates the fair value of franchise rights at the date of acquisition and determines if the franchise has a finite life or an indefinite life. The Company has concluded that all of its franchises qualify for indefinite life treatment given that there are no legal, regulatory, contractual, competitive, economic or other factors which limit the period over which these rights will contribute to the Company's cash flows. The Company reassesses this determination periodically or whenever events or substantive changes in circumstances occur. All franchises are tested for impairment annually or more frequently as warranted by events or changes in circumstances. Franchises are aggregated into essentially inseparable units of accounting to conduct valuations. The franchise units of accounting are geographical clustering of cable systems into groups representing the highest and best use if sold to market participants. The Company performed a quantitative impairment analysis as of October 31, 2025 utilizing a multi-period excess earnings method, a discounted cash flow income approach which isolates discrete cash flows attributable to the franchise intangibles from the business enterprise cash flows. The income approach incorporated updated projections of the business enterprise cash flows, allocations of cash flows attributable to franchise intangibles, and current market assumptions for growth rates and discount rates. Based on the Company’s quantitative analysis, the Company concluded that the fair value of the franchises in each unit of accounting exceeds the carrying value of such assets. Goodwill is also tested for impairment annually or more frequently as warranted by events or changes in circumstances. The Company has determined that it has one reporting unit for purposes of the assessment of goodwill impairment. As with the Company’s franchise impairment testing, the Company elected to perform a quantitative goodwill impairment analysis as of October 31, 2025.

Organization and Basis of Presentation Organization Charter Communications, Inc. (together with its controlled subsidiaries, “Charter,” or the “Company”) is a leading broadband connectivity company with services available to homes and small to large businesses through its Spectrum® brand. Founded in 1993, the Company has evolved from providing cable TV to streaming, and from high-speed Internet to a converged broadband, WiFi and mobile experience. Over the Spectrum Fiber Broadband Network and supported by the Company’s 100% U.S.-based employees, the Company offers Seamless Connectivity and Entertainment with Spectrum Internet®, Mobile, TV and Voice products.Charter is a holding company whose principal asset is a controlling equity interest in Charter Communications Holdings, LLC (“Charter Holdings”), an indirect owner of Charter Communications Operating, LLC (“Charter Operating”) under which substantially all of the operations reside. Basis of PresentationThe accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Areas involving significant judgments and estimates include capitalization of labor and overhead costs, valuation and impairment of franchise assets and goodwill, and income taxes. Actual results could differ from those estimates. Certain prior period amounts have been reclassified to conform with the 2025 presentation.Comprehensive income equaled net income attributable to Charter shareholders for the years ended December 31, 2025, 2024 and 2023.

Parent Company Only Financial Statements As the result of limitations on, and prohibitions of, distributions, substantially all of the net assets of the consolidated subsidiaries are restricted from distribution to Charter, the parent company. The following condensed parent-only financial statements of Charter account for the investment in Charter Holdco under the equity method of accounting. Comprehensive income equaled net income for the years ended December 31, 2025, 2024 and 2023. The financial statements should be read in conjunction with the consolidated financial statements of the Company and notes thereto. Charter Communications, Inc. (Parent Company Only)Condensed Balance SheetsDecember 31,20252024ASSETSReceivables from related party$30 $10 Prepaid expenses and other current assets160 19 Investment in subsidiaries36,614 35,494 Other noncurrent assets39 21 Total assets$36,843 $35,544 LIABILITIES AND SHAREHOLDER'S EQUITY Current liabilities$53 $397 Deferred income taxes19,771 18,749 Loans payable - related party49 50 Other long-term liabilities916 761 Shareholder's equity16,054 15,587 Total liabilities and shareholder's equity$36,843 $35,544 Charter Communications, Inc. (Parent Company Only)Condensed Statements of OperationsYear Ended December 31,202520242023REVENUES$3 $3 $1 COSTS AND EXPENSES:Operating costs and expenses 3 3 1 Other operating income, net— — (60)3 3 (59)Income from operations— — 60 OTHER INCOME (EXPENSES):Interest expense, net(4)(4)(4)Equity in income of subsidiaries6,644 6,640 6,021 6,640 6,636 6,017 Income before income taxes6,640 6,636 6,077 Income tax expense(1,653)(1,553)(1,520)Net income$4,987 $5,083 $4,557 Charter Communications, Inc.