Cable One Inc (NYSE:CABO) reported financial results for the fourth quarter and full year 2025 that fell significantly short of Wall Street's expectations, sending its shares lower in after-hours trading. The broadband provider's quarterly revenue declined, and it posted a substantial per-share loss against forecasts for a profit, highlighting ongoing challenges in its core residential markets.
Earnings Miss and Revenue Decline
The company's fourth-quarter performance was notably weaker than analysts had anticipated. Cable One reported a net loss of $7.6 million, or $1.35 per share, a stark contrast to the consensus estimate for earnings of $6.78 per share. This loss, while an improvement from a $105.2 million loss in the prior-year quarter which included a large non-cash impairment, still represents a significant earnings miss.
Revenue also disappointed, coming in below forecasts:
- Reported Q4 Revenue: $363.7 million
- Estimated Q4 Revenue: $375.8 million
- Year-over-Year Change: A decrease of 6.1%
The revenue decline was primarily driven by continued subscriber losses in key segments. Residential data revenue fell 4.2% year-over-year to $219.6 million, and residential video revenue dropped 15.2% to $42.9 million. Business data revenue saw a modest decline of 1.3%. Management noted that net subscriber trends in the quarter showed some improvement compared to earlier in 2025 but were not enough to offset the broader downward pressure.
Market Reaction and Recent Performance
The market's reaction to the earnings release was negative. Following the announcement, the stock traded slightly higher in the after-market session, up approximately 0.06%. However, this minimal gain follows a period of significant pressure, with the stock down over 13% in the past week and 18% over the last two weeks. The steep pre-earnings sell-off suggests investors were bracing for weak results, and the confirmed miss on both top and bottom lines validates those concerns.
Key Financial Highlights and Strategic Focus
Beyond the headline misses, the earnings release outlined several important financial and operational points:
- Strong Operational Cash Flow: Despite the net loss, the company generated robust cash flow. Adjusted EBITDA for Q4 was $193.9 million, representing a healthy margin of 53.3%. Net cash from operating activities was $145.5 million.
- Aggressive Debt Reduction: A key focus remains on strengthening the balance sheet. Cable One paid down $90.2 million in debt during the quarter and reduced total debt by over $400 million for the full year. Its $1.25 billion revolving credit facility remains undrawn, providing financial flexibility.
- Sustained Capital Investment: Capital expenditures were $74.0 million for the quarter, slightly higher than the prior year. Spending was directed toward line extensions and scalable infrastructure, indicating continued investment in the network.
- Leadership Transition: The report is the first under new CEO Jim Holanda, who stated the company's focus is on "defending our customer base, capitalizing on profitable growth and executing on key efficiency initiatives."
Looking Ahead
The press release did not provide specific quantitative financial guidance for the coming year. This lack of a formal outlook makes a direct comparison to analyst estimates difficult. Wall Street currently expects revenue of approximately $373.2 million for Q1 2026 and $1.48 billion for the full year 2026.
The company's strategy appears to hinge on stabilizing its subscriber base, deepening relationships with existing customers, and carefully expanding its product offerings in areas with sound economics. The significant debt paydown improves its financial footing to navigate a competitive environment.
For a detailed look at historical earnings and future analyst estimates for Cable One, visit the earnings and estimates page.
Disclaimer: This article is for informational purposes only and does not constitute investment advice, nor does it recommend buying or selling any securities. Investors should conduct their own research and consult with a qualified financial advisor before making any investment decisions.
