Time Warner Cable, target of a pending takeover by John Malone-backed Charter Communications, posted revenue and earnings below analyst expectations for the second quarter of 2015 — even though the cable operator touted its best subscriber results in seven years.

A factor that weighed on the bottom line: TW Cable’s programming and content costs climbed 11% in the period, to $1.49 billion, compared with the year-ago quarter.

For the three months ended June 30, Time Warner Cable reported revenue of $5.93 billion (up 3.5% year-over-year) and net income of $463 million (down 7%) with adjusted earnings per share of $1.54. The Street had projected revenue of $5.94 billion and EPS of $1.80.

TW Cable chairman and CEO Rob Marcus, expected to exit if and when Charter completes the acquisition, tried to accentuate the positive in announcing the Q2 results. “We achieved record Q2 subscriber results across nearly every category, setting us up for accelerating financial performance as we look forward to the next phase of our plan,” he said in a statement. “We intend to use the time between the signing and closing of the Charter deal to further strengthen our operations.”

While Time Warner Cable’s revenue and profitability have lagged for the second straight quarter, “This is what a turnaround always looks like,” MoffettNathanson’s Craig Moffett wrote in a research note. “TWC is well along in a turnaround that we expect to yield longer-term growth… Charter investors should be pleased.”

The cable company said residential video subscribers declined by a net 45,000, the smallest Q2 loss since 2008, ending the quarter with 10.77 million TV customers. Time Warner Cable also added a net 172,000 residential broadband subs and 252,000 residential voice subs, its highest second-quarter gains in those segments in seven years.

Charter is awaiting government approval for its proposed $79 billion Time Warner Cable deal, having made several concessions including pledging to not charge content companies for direct access to its Internet networks. Comcast last year made a bid for TW Cable, but the cable giant abandoned that in March after regulators signaled they would move to block it; that opened the door for the potential Charter-TWC merger.

Last week, AT&T got the regulatory go-ahead for its $49 billion takeover of DirecTV, creating the largest pay-TV provider in the U.S. with around 26 million video subs.