• Total Revenue: $9 billion, declined 3.1% year-over-year.
• Mobile Service Revenue Growth: 52% increase.
• News and Advertising Growth: 8.6% increase.
• Business Services Growth: 0.3% increase.
• Other Revenue Growth: 22.5% increase, primarily driven by mobile equipment revenue.
• Residential Revenue Decline: 4.6% decrease.
• Adjusted EBITDA: $3.4 billion, declined 5.4% year-over-year.
• Gross Margin: 67.7%, grew approximately 50 basis points year-over-year.
• Adjusted EBITDA Margin: 38.1% for the full year.
• Cash Capital Expenditures: $1.4 billion, 16% improvement year-over-year.
• Free Cash Flow: $149 million, grew 23% year-over-year.
• Residential ARPU: $135.44, declined 1% year-over-year.
• Fiber Net Additions: 57,000 in Q4, a 22% increase year-over-year.
• Mobile Line Net Additions: 40,000 in Q4, best performance in the last 5 years.
• Broadband Subscribers: 4.3 million at year-end.
• Mobile Lines: 460,000 at year-end.
• Fiber Customers: 538,000, over 18% penetration of the fiber network.
• Capital Intensity: 16% in 2024, down approximately 250 basis points from 2023.
• Leverage Ratio: 7.3x the last 2 quarters annualized adjusted EBITDA.
• Liquidity Position: Approximately $1 billion through undrawn revolver capacity and cash balances.

• Warning! GuruFocus has detected 6 Warning Signs with ATUS.

Release Date: February 13, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Altice USA Inc (NYSE:ATUS) achieved its best-ever quarter for fiber net additions with a 22% year-over-year increase, indicating strong growth in its fiber network.
• The company reported a 40,000 line net addition in its mobile segment, marking the best performance in the last five years and a 70% growth in mobile line net additions.
• Altice USA Inc (NYSE:ATUS) maintained a strong base of 4.3 million broadband subscribers and 460,000 mobile lines, showcasing a solid customer base.
• The company successfully reduced capital expenditures by approximately $480 million over the last two years, demonstrating improved capital efficiency.
• Free cash flow grew by 23% year-over-year to $149 million, despite higher cash interest, highlighting financial resilience and operational efficiency.

Negative Points

• Total revenue declined by 3.1% year-over-year, with residential revenue decreasing by 4.6%, indicating challenges in maintaining revenue growth.
• Broadband subscriber net losses were 39,000 in the quarter, partly due to the impacts of a hurricane and pilot programs, reflecting vulnerability to external factors.
• The West footprint faced challenges from incremental fiber overbuilders and fixed wireless competition, impacting market performance.
• The company experienced a strong political cycle in early Q4, but news and advertising revenue came in below initial projections, indicating volatility in this segment.
• Altice USA Inc (NYSE:ATUS) has a high leverage ratio of 7.3x, which could pose risks to financial stability if not managed effectively.

Q & A Highlights

Q: Can you discuss broadband performance in different regions and the competitive environment? A: Dennis Mathew, CEO: In the West, overbuild has increased to about 45%, with fixed wireless competition also present. In the East, overbuild remains at about 70%. We've improved churn and go-to-market strategies in the East, and in the West, market tests have shown a 20% improvement in sales and installs. We're now using more targeted strategies rather than a one-size-fits-all approach.

Q: Can you explain the pressure on EBITDA in Q4 and whether it will affect costs in 2025? A: Dennis Mathew, CEO: We invested in a robust strategy for our Phase II transformation, which impacted Q4. Marc Sirota, CFO: Normalized EBITDA trends were down 5% in Q4 due to onetime items like storm costs. We expect EBITDA trends to improve in 2025 with new strategies and network improvements.

Q: How are you addressing the balance sheet and potential deleveraging? A: Marc Sirota, CFO: We are exploring all options to address our debt maturity profile and maintain a supportive capital structure. Regarding LightPath, we are focused on maximizing growth and value, with no current plans to monetize the asset.

Q: What are your plans for CapEx after 2025, and can you elaborate on the hyperscaler business? A: Marc Sirota, CFO: We are optimistic about capital deployment trends but have no specific guidance beyond 2025. The hyperscaler business involves connecting large data centers, and many transactions are self-funded. LightPath's cash is currently staying within the operation.

Q: Can you discuss the fiber strategy and cost per passing? A: Dennis Mathew, CEO: We have a multiyear network strategy focusing on fiber, with new builds costing about $800 to $900 per passing. We are also investing in HFC upgrades for multi-gig speeds. Marc Sirota, CFO: Mid splits cost just over $100 per passing, offering a capital-efficient way to enhance network performance.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.