Altice Usa ((ATUS)) has held its Q4 earnings call. Read on for the main highlights of the call.
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During Altice USA’s latest earnings call, the sentiment was notably balanced. The company reported significant growth in its fiber and mobile segments, alongside improvements in capital efficiency. However, these positive aspects were overshadowed by an overall revenue decline, losses in broadband subscribers, and competitive challenges in the Western regions, indicating both achievements and challenges for the company.
Fiber and Mobile Growth
Q4 was remarkable for Altice USA’s fiber and mobile segments, with fiber net additions reaching 57,000, marking a 22% year-over-year increase. Additionally, mobile growth surged with 40,000 line net additions, the best performance in five years, showing a 70% acceleration in 2024.
Revenue Achievements in Key Areas
Altice USA celebrated noteworthy revenue achievements, particularly in residential mobile services and LightPath, both reaching their highest ever full-year revenue in 2024. LightPath revenue increased by 5.5% year-over-year, totaling $414 million.
Capital Efficiency
The company saw a 16% reduction in capital expenditures, totaling $1.4 billion, while still meeting strategic growth objectives. Free cash flow impressively grew by 23% year-over-year, reaching $149 million, highlighting Altice’s focus on capital efficiency.
Improved Network Quality
Optimum Fiber was recognized for delivering the fastest and most reliable Internet speeds in New York and New Jersey, coupled with the lowest latency and best gaming experience in these areas, enhancing customer satisfaction and service quality.
Overall Revenue Decline
Despite growth in certain areas, Altice USA experienced a 3.1% decline in total revenue, dropping to $9 billion. Residential revenue fell by 4.6%, reflecting broader challenges in sustaining revenue growth.
Broadband Subscriber Losses
The company reported a net loss of 39,000 broadband subscribers in Q4, influenced by adverse weather conditions like a hurricane in North Carolina, and pressure from low home sales.
Competitive Challenges
Increased competition in the West, primarily from fiber overbuilders and fixed wireless providers, posed significant challenges. This region also faced income constraints among households, impacting revenue generation.
Increased Direct Costs
Direct costs surged, driven largely by the mobile business expansion and programming expenses, though there was a noted reduction in volume.
Forward-Looking Guidance
Altice USA shared its strategic plans for 2025, emphasizing a continued transformation. The company aims to focus on improving broadband subscriber trends, enhancing capital efficiency, and strengthening its network. With a shift towards new fiber builds and mid-split upgrades, Altice is poised to optimize its product portfolio and sustain a robust capital structure.
In conclusion, Altice USA’s earnings call reflected a blend of accomplishments and hurdles. While significant growth in fiber and mobile segments was commendable, challenges such as revenue decline and subscriber losses cannot be overlooked. The company’s forward-looking strategies signal a commitment to overcoming these challenges and achieving sustainable growth in the future.
