Charter Communications (NASDAQ:CHTR)'s stock is going through the roof today as the company rides the wave of a positive earnings release and a major announcement with the nation's number one cable provider, Comcast (NASDAQ:CMCSA). As a company that found itself in the throes of bankruptcy just a few of years ago, Charter has emerged as a leading player in the industry, backed by the very visible hand of John Malone—the modern cable industry's progenitor. Today, the company is taking on more subscribers as part of a broad effort to grow its all-digital network and secure its place in the quickly tightening U.S. pay-TV landscape. Aiding that effort more than anything is a $22 billion  deal with Comcast that has analysts and investors buzzing.

The results
Charter is currently  the fourth largest cable provider in the U.S., yet its recent results are some of the brightest in the industry. The company added  206,000 units (subscribers) in its fiscal first quarter, with 18,000 net video additions. Compare that to the nation's second largest player, Time Warner Cable (UNKNOWN:TWC.DL), which recently booked a net loss of 34,000 video subscribers.

The company presented its headline earnings on a pro forma basis, as Charter recently completed its acquisition of content distributor Bresnan. Revenue grew 7.5%  to $2.2 billion, while adjusted EBITDA grew in line at 7.3%. Leading the forward surge in earnings, perhaps unsurprisingly, was the Commercial segment, which services small businesses. Revenue for the segment grew 20%.

The aforementioned effort to become an all-digital provider is 30% complete at this point, which should encourage investors. The benefits of the network involve higher average speeds, greater picture quality, and interactive on demand services—crucial to today's U.S. pay-TV landscape. As the industry continues to mature, the name of the game is market share. This leads us to the most pressing news in Charter's recent results.

The big deal
While Charter is currently the number four player in the industry, management has successfully jockeyed for an upgrade to number two. Over the weekend, rumors swirled and eventually manifested with a $22 billion deal in which Charter will pick up millions of subscribers from Comcast. The deal took place as the latter company is fighting hard to obtain regulatory approval for its proposed megamerger with Time Warner Cable.

Charter was originally left out of the biggest, most important consolidation in modern cable history after it had lost a bid to buy Time Warner Cable. John Malone, chairman of Liberty Media (which owns 25% of Charter), had orchestrated the deal and was likely a major part of this one. Malone has long talked of the need for immense consolidation in cable in order to fight back against rising content costs and the disruption of Internet streaming businesses.

The deal involves  1.4 million of Time Warner Cable's (and thus Comcast's) subscribers being sold to Charter, in addition to a new joint venture between Comcast and Charter, where Charter is a 35% owner. The newly formed company would take on 2.5 million subscribers. Closing out the deal would be a 1.65 million-strong subscriber swap between Comcast and Charter, designed to strengthen individual markets and maintain competition.

Whether the deal will ultimately be approved by regulators is up in the air, but this is fantastic news for Charter. Even though the company is growing organically, the looming effects of cable's biggest and second biggest providers coming together could have spelled heavy currents for Charter's upstream battle.

All in all, this is a great start to the second quarter for Charter and its investors.