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Charter issues growth warning

The cable company says a decline in cable subscribers will cause third-quarter revenue to fall short of previous expectations.

Charter Communications warned Tuesday that a decline in cable subscribers will cause third-quarter revenue to fall short of previous expectations.

The cable company now expects revenue growth of 13 percent, down slightly from its earlier forecast of 13.7 percent.

The new forecast was released after the close of regular trading, when Charter's shares were selling for $2, up 14 cents for the day. In after-hours trading, the stock dipped to $1.73.

The company, created and controlled by Microsoft co-founder Paul Allen, has fallen below expectations for its basic cable subscriber growth for the past two quarters as it faces still competition from digital satellite service.

Although the company has lowered its revenue forecast, Charter continues to stand by its expectation it will become cash-flow positive by the end of the year. The company expects its capital expenses will drop off substantially this year as it completes efforts to rebuild and upgrade its broadband network.