• Total Revenue (Q4 2024): $387.2 million, a decrease of 6% year-over-year.
• Residential Data Revenue (Q4 2024): Decreased by 5.4% year-over-year.
• Business Data Revenue (Q4 2024): Increased by 2.3% year-over-year.
• Net Loss (Q4 2024): $105.2 million, compared to a net income of $103.5 million in Q4 2023.
• Adjusted EBITDA (Q4 2024): $211 million, a decrease of 7% year-over-year.
• Adjusted EBITDA Margin (Q4 2024): 54.5% compared to 55.1% in Q4 2023.
• Capital Expenditures (Q4 2024): $71.9 million, down from $115.6 million in Q4 2023.
• Adjusted EBITDA less Capital Expenditures (Q4 2024): $139.1 million, a 25% increase year-over-year.
• Total Revenue (Full Year 2024): $1.58 billion, a decrease of 5.9% from 2023.
• Residential Data Revenue (Full Year 2024): Declined by 5.5% year-over-year.
• Business Data Revenue (Full Year 2024): Increased by 2.6% year-over-year.
• Net Income (Full Year 2024): $14.5 million, compared to $224.6 million in 2023.
• Adjusted EBITDA (Full Year 2024): $854 million, a decrease of 6.9% from 2023.
• Adjusted EBITDA Margin (Full Year 2024): 54.1% compared to 54.6% in 2023.
• Capital Expenditures (Full Year 2024): $286.4 million, down from $371 million in 2023.
• Adjusted EBITDA less Capital Expenditures (Full Year 2024): $567.6 million, a 4% increase year-over-year.
• Debt Repayment (2024): $238.1 million, including $219.9 million in voluntary early repayments.
• Cash and Cash Equivalents (End of 2024): Approximately $154 million.
• Total Debt (End of 2024): Approximately $3.6 billion.
• Net Leverage Ratio (End of 2024): 4.1 times on a last quarter annualized basis.

• Warning! GuruFocus has detected 3 Warning Signs with CABO.

Release Date: February 27, 2025

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

Positive Points

• Cable One Inc (NYSE:CABO) achieved business broadband revenue growth, driven by increased demand in carrier, enterprise, and wholesale segments.
• The company successfully stabilized residential ARPU in the latter half of 2024, aided by increased sales of higher-tier products and services.
• Cable One Inc (NYSE:CABO) completed significant rebranding and unified billing system migrations, which are expected to yield operational efficiencies and cost savings.
• The company reported a 25% year-over-year increase in adjusted EBITDA less capital expenditures for Q4 2024, indicating improved capital efficiency.
• Cable One Inc (NYSE:CABO) is integrating AI into its operations, enhancing customer experience and operational efficiency, and reducing churn.

Negative Points

• Total revenues for Q4 2024 decreased by 6% year-over-year, with residential data revenues declining by 5.4%.
• The discontinuation of the affordable connectivity program led to a loss of approximately 10,000 residential data PSUs.
• Net loss for Q4 2024 was $105.2 million, primarily due to non-cash, non-operating charges related to the MBI investment.
• Adjusted EBITDA for 2024 decreased by 6.9% compared to the previous year, reflecting challenges in maintaining profitability.
• Cable One Inc (NYSE:CABO) faces increasing competition from incumbent LECs deploying new fiber, impacting market dynamics.

Q & A Highlights

Q: Can you discuss the strategy for addressing the MBI call option and the 2026 convertible notes? A: Todd Koetje, CFO, explained that the strategic amendment with MBI provides additional capital flexibility and enhanced liquidity for refinancing strategies. Cable One has a committed $1.25 billion revolver and expects proceeds from strategic investments to exceed $100 million, which will help address the convertible notes due in Q1 2026.

Q: How do you plan to manage ARPU growth given the various factors affecting it? A: Julia Laulis, CEO, stated that Cable One has multiple levers to grow units and expand ARPU, such as targeting different market segments and customer segments. The company will use tactics that make the most sense based on market conditions and customer needs, including potential rate increases when enhancements bring significant value.

Q: Are you considering offering mobile services to drive growth, given the trend towards convergence in telecommunications? A: Julia Laulis, CEO, mentioned that while Cable One is open to partnering with a mobile provider if it benefits customers, the focus remains on organic broadband revenue growth. The company believes it can achieve growth without mobile services by leveraging its existing tools and strategies.

Q: What factors contributed to the churn and subscriber results in the fourth quarter? A: Todd Koetje, CFO, clarified that churn actually decreased in Q4 2024, marking the second lowest quarter in the last three years. Julia Laulis, CEO, added that unique headwinds such as the winding down of the ACP, platform migrations, and team changes affected performance but do not reflect the expected run rate for 2025.

Q: Can you elaborate on the competitive dynamics and the impact of fiber overbuilding in your markets? A: Julia Laulis, CEO, noted that independent overbuilding is moderating, possibly due to the exhaustion of attractive areas and the challenges of operating networks in rural areas. Cable One's strategic response to competition, including targeted pricing strategies, has also played a role in deterring new entrants.

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