Various remarks that we make on this call concerning expectations, predictions, plans and prospects constitute forward-looking statements. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ from historical or anticipated results. Any forward-looking statements reflect management’s current view only and Charter undertakes no obligation to revise or update such statements or to make additional forward-looking statements in the future.During the course of today’s call, we’ll be referring to non-GAAP measures as defined and reconciled in this morning’s earnings release. These non-GAAP measures as defined by Charter may not be comparable to measures with similar titles used by other companies. In today’s earnings release, we reported results in accordance with GAAP as well as pro forma results for 2010 and 2011. The pro forma results reflect the divestiture and acquisition of Cable Systems in 2010 and 2011 as of they had occurred on January 1, 2010 unless otherwise noted. The year-over-year growth rates we will be referring to this morning are in a pro forma basis. Joining me on today’s call are Mike Lovett, President and CEO and Chris Winfrey, our CFO and Don Detampel EVP of technology and President commercial services. I will now turn the call over to Mike. Mike Lovett Thanks Robin. Good morning and thank you for joining us today. We are pleased with third quarter results in which we grew our revenues 3% and adjusted EBITDA 3.8% and generated healthy free cash flow. We accelerated growth in our commercial business through our robust growth in our internet business and improved our margin by 30 basis points compared to last year. We also continued to take an opportunistic disciplined approach to investing in ROI positive projects both organic and M&A as well as share and debt repurchases. We made meaningful advances in all four of our strategic priorities that we outlined at the beginning of the year.
Before we go into more details on our third quarter results I’d first like to take a step back and update you on the execution of these strategies.First, we are focused on fundamentally improving the customer experience, which is the foundation underlying our future success. We are transforming Charter into a customer centric organization with a commitment to delivering unmatched customer experience. We are improving our product offerings as well as the quality and reliability of our service, and while we are starting to see positive results in our operations and customer retention we are still in the early stages. It takes time for these improvements to resonate with customers and to show off this meaningful improvement in overall external customer satisfaction studies. However, you need to see results, the best evidence of our progress is new customer satisfaction, which is more than 35% higher than for our more tenured customers, and as I said we are seeing results in our operations. Our efforts drove an 11% decrease in billing and service calls and 10% fewer service truck rolls in the third quarter compared to last year, and we continued to see improved customer relationships. In addition to increasing customer satisfaction all of this generates bottom-line savings. Our second strategic priority is to lead with our superior Internet product in our sales, promotion, and branding efforts, to leverage our structural broadband advantage and create new customer relationships. While video is still an important element of our business, we continue to lead with our strengthened Internet. In the vast majority of our footprint we have superior Internet speeds and in less than 4% of our footprint where we overlapped the FiOS and other fiber competitors we have comparable speeds with 60-Meg residential product. Nearly 95% of our internet customers have a broadband service of 12-Meg or higher.
Our advantage is evident. Charter’s Internet Service received top rankings from PC Magazine and high marks from the FCC in speed testing, and Netflix has rated us the best performing cable or DSL Internet provider for the third consecutive time this year.Accelerated growth and the number of IP devices and bandwidth used in households will feel the need for faster speeds and greater reliability. Charter is uniquely positioned to provide those services. In addition to speed customers are looking for a solutions provider as evidenced by the popularity of our home networking product. The number of customers using our in-home Wi-Fi service jumped 34% year-over-year with nearly one in four customers now relying on us for home wireless connectivity. As slide three highlights there is an opportunity to increase our Internet penetration particularly in Homes Passed where we don’t have a video customer relationship. We are seeing continued growth and penetration as our net gains of non-video homes again doubled. But a 10% penetration compared to well over 60% in homes where we have a video relationship we feel we have ample room for growth. We are growing share and forming new customer relationships by creative marketing, increased education of our Charter as a premier ISP provider and the use of non-traditional sales channels. Last quarter we announced our partnership with Dish. We have been very pleased with the initial results where we are seeing a significant improvement in response rate and sales performance. As we ended the quarter we started marketing this across our entire footprint. Another priority for us is to aggressively drive commercial growth. There is a significant amount of untapped commercial opportunity in our footprint. We are making investments in people, processes, and systems to expand our capabilities in these markets and extend our reach. Our commercial internet and phone businesses are more growth oriented while our commercial video business is relatively stable. In Q3 we grew data and phone commercial revenues by nearly 30% versus last year. Read the rest of this transcript for free on seekingalpha.com