UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2022~~March 31, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period to

Commission File Number 001-16441

CROWN CASTLE INC.

(Exact name of registrant as specified in its charter)


Delaware						76-0470458
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

8020 Katy Freeway, Houston, Texas 77024

(Address of principal executives office) (Zip Code)

(713) 570-3000

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	CCI	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of common stock outstanding at ~~November 2, 2022: 433,048,001~~May 1, 2023: 433,671,293

CROWN CASTLE INC. AND SUBSIDIARIES

INDEX

Cautionary Language Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q ("Form 10-Q") contains forward-looking statements that are based on our management's expectations as of the filing date of this report with the Securities and Exchange Commission ("SEC"). Statements that are not historical facts are hereby identified as forward-looking statements. In addition, words such as "estimate," "anticipate," "project," "plan," "intend," "believe," "expect," "likely," "predicted," "positioned," "continue," "target," "seek," "focus" and any variations of these words and similar expressions are intended to identify forward-looking statements. ~~Such~~

Examples of forward-looking statements include our full year 2023 outlook and plans, projections and estimates ~~contained in~~ ~~"Part I—Item 2. Management's Discussion and Analysis~~regarding (1) the value of ~~Financial Condition and Results of Operations"~~ ~~("MD&A") and~~ ~~"Part I—Item 3. Quantitative and Qualitative Disclosures About Market Risk"~~ ~~herein. Such forward-looking statements include (1) benefits and opportunities stemming from~~ our ~~strategy, strategic position,~~ business model and ~~capabilities,~~demand for our communications infrastructure, (2) the ~~strength and~~ growth ~~potential~~ of the U.S. market for shared communications infrastructure, ~~investment,~~ (3) ~~expectations regarding anticipated~~ growth in the ~~wireless~~communications infrastructure industry, ~~and consumption of and~~(4) demand for data including growth in, and factors driving, consumption and demand, (4) potential benefits of our communications infrastructure (on an individual and collective basis) and expectations regarding demand therefore, including potential benefits and continuity of and factors driving such demand, (5) ~~expectations regarding construction, including~~the duration of our construction projects, ~~and acquisition of communications infrastructure,~~ (6) ~~the utilization of our net operating loss carryforwards ("NOLs"),~~tenants' investment in wireless networks, (7) ~~expectations regarding wireless carriers' focus on improving network quality and expanding capacity, (8) expectations regarding continued increase in usage~~use of high-bandwidth applications, by organizations, (9) expected use of net proceeds from issuances under the commercial paper program ("CP Program"), (10) our full year 2022 and 2023 outlook and the anticipated growth in our financial results, including future revenues and operating cash flows, and the expectations regarding our capital expenditures, as well as the factors impacting expected growth in financial results and the levels of capital expenditures, (11) expectations regarding our capital structure and the credit markets, our availability and cost of capital, capital allocation, our leverage ratio target,(8) our ability to service our debt and comply with debt covenants, ~~and~~(9) the ~~plans for and the benefits~~level of ~~any future refinancings, (12) expectations related to~~commitment under our debt instruments, (10) our ability to remain qualified as a real estate investment trust ("REIT") ~~and the advantages, benefits or impact of, or opportunities created by, our REIT status, (13) adequacy, projected~~, (11) sources and uses of liquidity, (12) impact to our financial results from the Sprint Cancellations (as defined below), (13) drivers of cash flow growth, (14) our ~~dividend policy and the~~competitive advantage, (15) our dividends, including timing, amount, growth, targets, payment or tax characterization, (16) the timing of small cell deployments, (17) discretionary capital expenditures and expansion of our ~~dividends, (15) availability~~business and (18) impact of spectrum, (16) the T-Mobile Agreement (as defined below), including expectations related thereto and the benefits that may be derived therefrom, and the the impact from the T-Mobile and Sprint network consolidation contemplated therein, (17) discretionary investments and the benefits that may be derived therefrom, (18) potential adjustments in the interest rate ~~spread and unused commitment fee percentage on our 2016 Credit Facility, (19)~~

~~the outcome of outstanding litigation and (20) the utility of certain financial measures, including non-GAAP financial measures.~~increases. All future dividends are subject to declaration by our board of directors.

Such forward-looking statements should, therefore, be considered in light of various risks, uncertainties and assumptions, including prevailing market conditions, risk factors described in "Item 1A. Risk Factors" of the Annual Report on Form 10-K for the fiscal year ended December 31, ~~2021~~2022 ("~~2021~~2022 Form 10-K") and other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected.

Our filings with the SEC are available through the SEC website at www.sec.gov or through our investor relations website at investor.crowncastle.com. We use our investor relations website to disclose information about us that may be deemed to be material. We encourage investors, the media and others interested in us to visit our investor relations website from time to time to review up-to-date information or to sign up for e-mail alerts to be notified when new or updated information is posted on the site.

Interpretation

As used herein, the term "including," and any variation thereof, means "including without limitation." The use of the word "or" herein is not exclusive. Unless this Form 10-Q indicates otherwise or the context otherwise requires, the terms "we," "our," "our company," "the company" or "us" as used in this Form 10-Q refer to Crown Castle Inc. ("CCI") ~~(formerly, Crown Castle International Corp.)~~ and its predecessor (organized in 1995), as applicable, each a Delaware corporation, and their subsidiaries. Additionally, unless the context suggests otherwise, references to "U.S." are to the United States of America and Puerto Rico, collectively. Capitalized terms used but not defined in this Form 10-Q have the same meaning given to them in the ~~2021~~2022 Form 10-K.

PART I—FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS

CROWN CASTLE INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)

(Amounts in millions, except par values)


		September 30, 2022		December 31, 2021			March 31, 2023		December 31, 2022
ASSETS	ASSETS					ASSETS
Current assets:	Current assets:					Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	174	$	292	Cash and cash equivalents	$	187	$	156
Restricted cash	Restricted cash	168		169		Restricted cash	196		166
Receivables, net	Receivables, net	535		543		Receivables, net	565		593
Prepaid expenses	Prepaid expenses	111		105		Prepaid expenses	159		102
Current portion of deferred site rental receivables						Current portion of deferred site rental receivables	125		127
Other current assets	Other current assets	194		145		Other current assets	93		73
Total current assets	Total current assets	1,182		1,254		Total current assets	1,325		1,217
Deferred site rental receivables	Deferred site rental receivables	1,880		1,588		Deferred site rental receivables	2,040		1,954
Property and equipment, net of accumulated depreciation of $12,780 and $11,937, respectively		15,265		15,269
Property and equipment, net of accumulated depreciation of $13,377 and $13,071, respectively						Property and equipment, net of accumulated depreciation of $13,377 and $13,071, respectively	15,492		15,407
Operating lease right-of-use assets	Operating lease right-of-use assets	6,613		6,682		Operating lease right-of-use assets	6,482		6,526
Goodwill	Goodwill	10,087		10,078		Goodwill	10,085		10,085
Other intangible assets, net	Other intangible assets, net	3,699		4,046		Other intangible assets, net	3,496		3,596
Other assets, net	Other assets, net	135		123		Other assets, net	134		136
Total assets	Total assets	$	38,861	$	39,040	Total assets	$	39,054	$	38,921

LIABILITIES AND EQUITY	LIABILITIES AND EQUITY					LIABILITIES AND EQUITY
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	229	$	246	Accounts payable	$	233	$	236
Accrued interest	Accrued interest	119		182		Accrued interest	132		183
Deferred revenues	Deferred revenues	686		776		Deferred revenues	721		736
Other accrued liabilities	Other accrued liabilities	387		401		Other accrued liabilities	300		407
Current maturities of debt and other obligations	Current maturities of debt and other obligations	819		72		Current maturities of debt and other obligations	819		819
Current portion of operating lease liabilities	Current portion of operating lease liabilities	344		349		Current portion of operating lease liabilities	330		350
Total current liabilities	Total current liabilities	2,584		2,026		Total current liabilities	2,535		2,731
Debt and other long-term obligations	Debt and other long-term obligations	20,664		20,557		Debt and other long-term obligations	21,513		20,910
Operating lease liabilities	Operating lease liabilities	5,941		6,031		Operating lease liabilities	5,856		5,881
Other long-term liabilities	Other long-term liabilities	1,993		2,168		Other long-term liabilities	1,927		1,950
Total liabilities	Total liabilities	31,182		30,782		Total liabilities	31,831		31,472
Commitments and contingencies (note 8)	Commitments and contingencies (note 8)					Commitments and contingencies (note 8)
Stockholders' equity:	Stockholders' equity:					Stockholders' equity:
Common stock, $0.01 par value; 1,200 shares authorized; shares issued and outstanding: September 30, 2022—433 and December 31, 2021—432		4		4
Common stock, $0.01 par value; 1,200 shares authorized; shares issued and outstanding: March 31, 2023—434 and December 31, 2022—433						Common stock, $0.01 par value; 1,200 shares authorized; shares issued and outstanding: March 31, 2023—434 and December 31, 2022—433	4		4
Additional paid-in capital	Additional paid-in capital	18,087		18,011		Additional paid-in capital	18,154		18,116
Accumulated other comprehensive income (loss)	Accumulated other comprehensive income (loss)	(7)		(4)		Accumulated other comprehensive income (loss)	(6)		(5)
Dividends/distributions in excess of earnings	Dividends/distributions in excess of earnings	(10,405)		(9,753)		Dividends/distributions in excess of earnings	(10,929)		(10,666)
Total equity	Total equity	7,679		8,258		Total equity	7,223		7,449
Total liabilities and equity	Total liabilities and equity	$	38,861	$	39,040	Total liabilities and equity	$	39,054	$	38,921

See notes to condensed consolidated financial statements.

CROWN CASTLE INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND

COMPREHENSIVE INCOME (LOSS) (Unaudited)

(Amounts in millions, except per share amounts)


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
		2022		2021		2022		2021				2023		2022
Net revenues:	Net revenues:									Net revenues:
Site rental	Site rental	$	1,568	$	1,451	$	4,711	$	4,245	Site rental		$	1,624	$	1,576
Services and other	Services and other	178		167		511		441		Services and other		149		166
Net revenues	Net revenues	1,746		1,618		5,222		4,686		Net revenues		1,773		1,742
Operating expenses:	Operating expenses:									Operating expenses:
Costs of operations:(a)	Costs of operations:(a)									Costs of operations:(a)
Site rental	Site rental	405		397		1,204		1,168		Site rental		415		396
Services and other	Services and other	119		115		344		301		Services and other		104		113
Selling, general and administrative	Selling, general and administrative	187		167		558		500		Selling, general and administrative		195		181
Asset write-down charges	Asset write-down charges	3		—		26		9		Asset write-down charges		—		14
Acquisition and integration costs		—		—		1		1

Depreciation, amortization and accretion	Depreciation, amortization and accretion	430		413		1,276		1,229		Depreciation, amortization and accretion		431		420
Total operating expenses	Total operating expenses	1,144		1,092		3,409		3,208		Total operating expenses		1,145		1,124
Operating income (loss)	Operating income (loss)	602		526		1,813		1,478		Operating income (loss)		628		618
Interest expense and amortization of deferred financing costs		(177)		(163)		(506)		(493)
Interest expense and amortization of deferred financing costs, net										Interest expense and amortization of deferred financing costs, net		(202)		(164)
Gains (losses) on retirement of long-term obligations	Gains (losses) on retirement of long-term obligations	(2)		(1)		(28)		(145)		Gains (losses) on retirement of long-term obligations		—		(26)
Interest income	Interest income	1		—		1		1		Interest income		2		—
Other income (expense)	Other income (expense)	(2)		(4)		(5)		(16)		Other income (expense)		(3)		(1)
Income (loss) before income taxes	Income (loss) before income taxes	422		358		1,275		825		Income (loss) before income taxes		425		427
Benefit (provision) for income taxes	Benefit (provision) for income taxes	(3)		(7)		(14)		(20)		Benefit (provision) for income taxes		(7)		(6)
Income (loss) from continuing operations		419		351		1,261		805
Discontinued operations:
Net gain (loss) from disposal of discontinued operations, net of tax		—		—		—		(62)
Income (loss) from discontinued operations, net of tax		—		—		—		(62)
Net income (loss)	Net income (loss)	419		351		1,261		743		Net income (loss)		418		421

Net income (loss)		$	419	$	351	$	1,261	$	743

Other comprehensive income (loss):										Other comprehensive income (loss):
Foreign currency translation adjustments	Foreign currency translation adjustments	(2)		(1)		(3)		1		Foreign currency translation adjustments		(1)		1
Total other comprehensive income (loss)	Total other comprehensive income (loss)	(2)		(1)		(3)		1		Total other comprehensive income (loss)		(1)		1
Comprehensive income (loss)	Comprehensive income (loss)	$	417	$	350	$	1,258	$	744	Comprehensive income (loss)		$	417	$	422
Net income (loss), per common share:	Net income (loss), per common share:									Net income (loss), per common share:
Income (loss) from continuing operations, basic		$	0.97	$	0.81	$	2.91	$	1.86
Income (loss) from discontinued operations, basic		—		—		—		(0.14)
Net income (loss)—basic		$	0.97	$	0.81	$	2.91	$	1.72
Income (loss) from continuing operations, diluted		$	0.97	$	0.81	$	2.91	$	1.85
Income (loss) from discontinued operations, diluted		—		—		—		(0.14)
Net income (loss)—diluted		$	0.97	$	0.81	$	2.91	$	1.71
Basic										Basic		$	0.97	$	0.97
Diluted										Diluted		$	0.97	$	0.97
Weighted-average common shares outstanding:	Weighted-average common shares outstanding:									Weighted-average common shares outstanding:
Basic	Basic	433		432		433		432		Basic		433		433
Diluted	Diluted	434		434		434		434		Diluted		434		434

(a)Exclusive of depreciation, amortization and accretion shown separately.

See notes to condensed consolidated financial statements.

CROWN CASTLE INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)

(In millions of dollars)


		Nine Months Ended September 30,					Three Months Ended March 31,
		2022		2021			2023		2022
Cash flows from operating activities:	Cash flows from operating activities:					Cash flows from operating activities:
Income (loss) from continuing operations		$	1,261	$	805
Adjustments to reconcile income (loss) from continuing operations to net cash provided by (used for) operating activities:
Net income (loss)						Net income (loss)	$	418	$	421
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:						Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:
Depreciation, amortization and accretion	Depreciation, amortization and accretion	1,276		1,229		Depreciation, amortization and accretion	431		420
(Gains) losses on retirement of long-term obligations	(Gains) losses on retirement of long-term obligations	28		145		(Gains) losses on retirement of long-term obligations	—		26
Amortization of deferred financing costs and other non-cash interest, net		10		9
Stock-based compensation expense		120		100
Amortization of deferred financing costs and other non-cash interest						Amortization of deferred financing costs and other non-cash interest	7		4
Stock-based compensation expense, net						Stock-based compensation expense, net	41		38
Asset write-down charges	Asset write-down charges	26		9		Asset write-down charges	—		14
Deferred income tax (benefit) provision	Deferred income tax (benefit) provision	2		4		Deferred income tax (benefit) provision	1		1
Other non-cash adjustments, net	Other non-cash adjustments, net	6		18		Other non-cash adjustments, net	2		1
Changes in assets and liabilities, excluding the effects of acquisitions:	Changes in assets and liabilities, excluding the effects of acquisitions:					Changes in assets and liabilities, excluding the effects of acquisitions:
Increase (decrease) in accrued interest	Increase (decrease) in accrued interest	(63)		(59)		Increase (decrease) in accrued interest	(51)		(65)
Increase (decrease) in accounts payable	Increase (decrease) in accounts payable	(10)		16		Increase (decrease) in accounts payable	(5)		(13)
Increase (decrease) in other liabilities	Increase (decrease) in other liabilities	(256)		(57)		Increase (decrease) in other liabilities	(127)		(196)
Decrease (increase) in receivables	Decrease (increase) in receivables	8		(62)		Decrease (increase) in receivables	28		40
Decrease (increase) in other assets	Decrease (increase) in other assets	(370)		(102)		Decrease (increase) in other assets	(139)		(133)
Net cash provided by (used for) operating activities	Net cash provided by (used for) operating activities	2,038		2,055		Net cash provided by (used for) operating activities	606		558
Cash flows from investing activities:	Cash flows from investing activities:					Cash flows from investing activities:
Capital expenditures	Capital expenditures	(921)		(892)		Capital expenditures	(341)		(281)
Payments for acquisitions, net of cash acquired	Payments for acquisitions, net of cash acquired	(15)		(27)		Payments for acquisitions, net of cash acquired	(67)		(3)
Other investing activities, net	Other investing activities, net	(10)		8		Other investing activities, net	1		(5)
Net cash provided by (used for) investing activities	Net cash provided by (used for) investing activities	(946)		(911)		Net cash provided by (used for) investing activities	(407)		(289)
Cash flows from financing activities:	Cash flows from financing activities:					Cash flows from financing activities:
Proceeds from issuance of long-term debt	Proceeds from issuance of long-term debt	748		3,985		Proceeds from issuance of long-term debt	999		748
Principal payments on debt and other long-term obligations	Principal payments on debt and other long-term obligations	(55)		(1,057)		Principal payments on debt and other long-term obligations	(19)		(18)
Purchases and redemptions of long-term debt	Purchases and redemptions of long-term debt	(1,274)		(2,089)		Purchases and redemptions of long-term debt	—		(1,274)
Borrowings under revolving credit facility	Borrowings under revolving credit facility	2,625		580		Borrowings under revolving credit facility	1,434		900
Payments under revolving credit facility	Payments under revolving credit facility	(2,580)		(870)		Payments under revolving credit facility	(1,305)		(665)
Net issuances (repayments) under commercial paper program	Net issuances (repayments) under commercial paper program	1,329		380		Net issuances (repayments) under commercial paper program	(524)		777
Payments for financing costs	Payments for financing costs	(14)		(43)		Payments for financing costs	(10)		(8)

Purchases of common stock	Purchases of common stock	(64)		(69)		Purchases of common stock	(28)		(63)
Dividends/distributions paid on common stock	Dividends/distributions paid on common stock	(1,924)		(1,738)		Dividends/distributions paid on common stock	(686)		(650)

Net cash provided by (used for) financing activities	Net cash provided by (used for) financing activities	(1,209)		(921)		Net cash provided by (used for) financing activities	(139)		(253)
Net increase (decrease) in cash, cash equivalents, and restricted cash - continuing operations		(117)		223
Discontinued operations:
Net cash provided by (used for) operating activities		—		(62)
Net increase (decrease) in cash, cash equivalents, and restricted cash - discontinued operations		—		(62)
Net increase (decrease) in cash, cash equivalents and restricted cash						Net increase (decrease) in cash, cash equivalents and restricted cash	60		16
Effect of exchange rate changes	Effect of exchange rate changes	(2)		—		Effect of exchange rate changes	1		—
Cash, cash equivalents, and restricted cash at beginning of period	Cash, cash equivalents, and restricted cash at beginning of period	466		381		Cash, cash equivalents, and restricted cash at beginning of period	327		466
Cash, cash equivalents, and restricted cash at end of period	Cash, cash equivalents, and restricted cash at end of period	$	347	$	542	Cash, cash equivalents, and restricted cash at end of period	$	388	$	482

See notes to condensed consolidated financial statements.

CROWN CASTLE INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF EQUITY

(Amounts in millions) (Unaudited)

Common Stock Accumulated Other Comprehensive Income (Loss) ("AOCI")
Shares ($0.01 Par) Additional
Paid-in
Capital Foreign Currency Translation Adjustments Dividends/Distributions in Excess of Earnings Total
Balance, June 30, 2022 433 $ 4 $ 18,050 $ (5) $ (10,188) $ 7,861
Stock-based compensation related activity, net of forfeitures — — 38 — — 38
Purchases and retirement of common stock — — (1) — — (1)
Other comprehensive income (loss)(a)
— — — (2) — (2)
Common stock dividends/distributions(b)
— — — — (636) (636)
Net income (loss) — — — — 419 419
Balance, September 30, 2022 433 $ 4 $ 18,087 $ (7) $ (10,405) $ 7,679


		Common Stock			Accumulated Other Comprehensive Income (Loss) ("AOCI")						Common Stock					Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss) ("AOCI")				Dividends/Distributions in Excess of Earnings
		Shares	($0.01 Par)		Additional Paid-in Capital		Foreign Currency Translation Adjustments		Dividends/Distributions in Excess of Earnings			Total			Shares									Dividends/Distributions in Excess of Earnings			Total
Balance, June 30, 2021		432	$	4	$	17,951	$	(2)	$	(9,240)		$	8,713
Balance, December 31, 2022														Balance, December 31, 2022	433	$	4			$	18,116				$	(5)		$	(10,666)	$	7,449
Stock-based compensation related activity, net of forfeitures	Stock-based compensation related activity, net of forfeitures	—	—		32		—		—			32		Stock-based compensation related activity, net of forfeitures	1	—		66				—			—			66
Purchases and retirement of common stock	Purchases and retirement of common stock	—	—		(1)		—		—			(1)		Purchases and retirement of common stock	—	—		(28)				—			—			(28)
Other comprehensive income (loss)(a)														Other comprehensive income (loss)(a)	—	—		—				(1)			—			(1)
Common stock dividends/distributions														Common stock dividends/distributions	—	—		—				—			(681)			(681)
Net income (loss)														Net income (loss)	—	—		—				—			418			418
Balance, March 31, 2023														Balance, March 31, 2023	434	$	4	$	18,154			$	(6)		$	(10,929)		$	7,223

Balance, December 31, 2021														Balance, December 31, 2021	432	$	4	$	18,011			$	(4)		$	(9,753)		$	8,258
Stock-based compensation related activity, net of forfeitures														Stock-based compensation related activity, net of forfeitures	1	—		58				—			—			58
Purchases and retirement of common stock														Purchases and retirement of common stock	—	—		(63)				—			—			(63)
Other comprehensive income (loss)(a)														Other comprehensive income (loss)(a)	—	—		—				1			—			1
Common stock dividends/distributions														Common stock dividends/distributions	—	—		—				—			(639)			(639)
Net income (loss)														Net income (loss)	—	—		—				—			421			421
Balance, March 31, 2022														Balance, March 31, 2022	433	$	4	$	18,006			$	(3)		$	(9,971)		$	8,036

Other comprehensive income (loss)(a)		—	—		—		(1)		—			(1)
Common stock dividends/distributions(b)		—	—		—		—		(578)			(578)

Net income (loss)		—	—		—		—		351			351
Balance, September 30, 2021		432	$	4	$	17,982	$	(3)	$	(9,467)		$	8,516

(a)See the condensed consolidated statement of operations and other comprehensive income (loss) for the components of other comprehensive income (loss).

~~(b)See notes 7 and 9 for information regarding common stock dividends declared per share.~~

See notes to condensed consolidated financial statements.

~~CROWN CASTLE INC. AND SUBSIDIARIES~~

~~CONDENSED CONSOLIDATED STATEMENT OF EQUITY~~

~~(Amounts in millions) (Unaudited)~~

Common Stock AOCI
Shares ($0.01 Par) Additional
paid-in
capital Foreign Currency Translation Adjustments Dividends/Distributions in Excess of Earnings Total
Balance, December 31, 2021 432 $ 4 $ 18,011 $ (4) $ (9,753) $ 8,258
Stock-based compensation related activity, net of forfeitures 1 — 140 — — 140
Purchases and retirement of common stock — — (64) — — (64)
Other comprehensive income (loss)(a)
— — — (3) — (3)
Common stock dividends/distributions(b)
— — — — (1,913) (1,913)
Net income (loss) — — — — 1,261 1,261
Balance, September 30, 2022 433 $ 4 $ 18,087 $ (7) $ (10,405) $ 7,679

Common Stock AOCI
Shares ($0.01 Par) Additional
paid-in
capital Foreign Currency Translation Adjustments Dividends/Distributions in Excess of Earnings Total
Balance, December 31, 2020 431 $ 4 $ 17,933 $ (4) $ (8,472) $ 9,461
Stock-based compensation related activity, net of forfeitures 1 — 118 — — 118
Purchases and retirement of common stock — — (69) — — (69)
Other comprehensive income (loss)(a)
— — — 1 — 1
Common stock dividends/distributions(b)
— — — — (1,738) (1,738)
Net income (loss) — — — — 743 743
Balance, September 30, 2021 432 $ 4 $ 17,982 $ (3) $ (9,467) $ 8,516

~~(a)See the condensed consolidated statement of operations and other comprehensive income (loss) for the components of other comprehensive income (loss).~~

~~(b)See notes 7 and 9 for information regarding common stock dividends declared per share.~~

CROWN CASTLE INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited

(Tabular dollars in millions, except per share amounts)

1.General

The information contained in the following notes to the condensed consolidated financial statements is condensed from that which would appear in the annual consolidated financial statements; accordingly, the condensed consolidated financial statements included herein should be reviewed in conjunction with the consolidated financial statements for the fiscal year ended December 31, ~~2021,~~2022, and related notes thereto, included in the ~~2021~~2022 Form 10-K filed by Crown Castle Inc. ("CCI"~~) (formerly, Crown Castle International Corp.~~) with the SEC. Capitalized terms used but not defined in these notes to the condensed consolidated financial statements have the same meaning given to them in the ~~2021~~2022 Form 10-K. References to the "Company" refer to CCI and its predecessor, as applicable, and their subsidiaries, unless otherwise indicated or the context indicates otherwise. As used herein, the term "including," and any variation thereof means "including without limitation." The use of the word "or" herein is not exclusive. Unless the context suggests otherwise, references to "U.S." are to the United States of America and Puerto Rico, collectively.

The Company owns, operates and leases shared communications infrastructure that is geographically dispersed throughout the U.S., including (1) towers and other structures, such as rooftops (collectively, "towers"), and (2) fiber primarily supporting small cell networks ("small cells") and fiber solutions. The Company's towers, ~~fiber~~small cells and ~~small cells~~fiber assets are collectively referred to herein as "communications infrastructure," and the Company's customers on its communications infrastructure are referred to herein as "tenants."

The Company's core business is providing access, including space or capacity, to its shared communications infrastructure via long-term contracts in various forms, including lease, license, sublease and service agreements (collectively, "tenant contracts").

The Company's operating segments consist of (1) Towers and (2) Fiber. See note 10.

As part of the Company's effort to provide comprehensive communications infrastructure solutions, as an ancillary business, the Company also offers certain services primarily relating to its Towers segment, predominately consisting of (1) site development services ~~primarily~~ relating to existing or new tenant equipment installations, including: site acquisition, architectural and engineering, or zoning and permitting (collectively, "site development services") and (2) tenant equipment installation or subsequent augmentations (collectively, "installation services").

The Company operates as a REIT for U.S. federal income tax purposes. In addition, the Company has certain taxable REIT subsidiaries ("TRSs"). See note 6.

Approximately 53% of the Company's towers are leased or subleased or operated and managed under master leases, subleases, and other agreements with AT&T and ~~T-Mobile.~~T-Mobile (including those which T-Mobile assumed in its merger with Sprint). The Company has the option to purchase these towers at the end of their respective lease terms. The Company has no obligation to exercise such purchase options.

Basis of Presentation

The condensed consolidated financial statements included herein are unaudited; however, they include all adjustments (consisting only of normal recurring adjustments) which, in the opinion of management, are necessary to state fairly the condensed consolidated financial position of the Company ~~at September 30, 2022,~~as of March 31, 2023, the condensed consolidated results of operations for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ and the condensed consolidated cash flows for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 and ~~2021.~~2022. The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the full year.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

2.Summary of Significant Accounting Policies

Recently Adopted Accounting Pronouncements

No accounting pronouncements adopted during the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 had a material impact on the Company's condensed consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

No new accounting pronouncements issued but not yet adopted are expected to have a material impact on the Company's condensed consolidated financial statements.

3.Revenues

Site Rental Revenues

The Company generates site rental revenues from its core business by providing tenants with access, including space or capacity, to its shared communications infrastructure via long-term tenant contracts in various forms, including lease, license, sublease and service agreements. ~~Providing~~Typically, providing such access over the length of the tenant contract term represents the Company’s sole performance obligation under its tenant contracts.

Site rental revenues from the Company's tenant contracts are recognized on a straight-line, ratable basis over the fixed, non-cancelable term of the relevant tenant contract, which generally ranges from five to 15 years for wireless tenants and three to 20 years for ~~the Company's~~ fiber solutions tenants (including from organizations with high-bandwidth and multi-location demands), regardless of whether the payments from the tenant are received in equal monthly amounts during the life of the tenant contract. Certain of the Company's tenant contracts contain (1) fixed escalation clauses (such as fixed dollar or fixed percentage increases) or inflation-based escalation clauses (such as those tied to the CPI), (2) multiple renewal periods exercisable at the tenant's option and (3) only limited termination rights at the applicable tenant's option through the current term. If the payment terms call for fixed ~~escalations,~~escalators, upfront payments, or rent-free periods, the revenue is recognized on a straight-line basis over the fixed, non-cancelable term of the tenant contract. When calculating ~~its~~ straight-line rental revenues, the Company considers all fixed elements of tenant contractual escalation provisions, even if such escalation provisions contain a variable element in addition to a minimum. The Company's assets related to straight-line site rental revenues ~~include current amounts~~are recorded within "Current portion of ~~$116 million included in "Other current assets"~~deferred site rental receivables" and ~~non-current amounts of $1.9 billion included in~~ "Deferred site rental receivables" ~~as of September 30, 2022.~~on the Company's condensed consolidated balance sheet. Amounts billed or received prior to being earned are deferred and reflected in "Deferred revenues" and "Other long-term liabilities" on the Company's condensed consolidated balance sheet. Amounts to which the Company has an unconditional right to payment, which are related to both satisfied or partially satisfied performance obligations, are recorded within "Receivables, net" on the Company's condensed consolidated balance sheet.

Sprint Cancellation Payments. For the three months ended March 31, 2023, site rental revenues include $48 million of payments in the Company's Fiber segment to satisfy the remaining rental obligations of certain canceled Sprint leases as a result of the T-Mobile US, Inc. and Sprint network consolidation.

Services and Other Revenues

As part of the Company’s effort to provide comprehensive communications infrastructure solutions, as an ancillary business, the Company offers certain services primarily relating to its Towers segment, predominately consisting of (1) site development services and (2) installation services. Upon contract commencement, the Company assesses its services to tenants and identifies performance obligations for each promise to provide a distinct service.

The Company may have multiple performance obligations for site development services, which primarily include: structural analysis, zoning, permitting and construction drawings. For each of these performance obligations, services revenues are recognized at completion of the applicable performance obligation, which represents the point at which the Company believes it has transferred goods or services to the tenant. The services revenue recognized is based on an allocation of the transaction price among the performance obligations in a respective tenant contract based on estimated standalone selling price. The volume and mix of site development services may vary among tenant contracts and may include a combination of some or all of the above performance obligations. ~~Payments~~Amounts are billed per contractual milestones, with payments generally ~~are~~ due within 45 to 60 days, and generally do not contain variable-consideration provisions. The transaction price for the Company's tower installation services consists of amounts for (1) permanent improvements to the Company's towers that represent a lease component and (2) the performance of the service. Amounts under the Company's tower installation service agreements that represent a lease component are recognized as site rental revenues on a straight-line basis over the length of the associated estimated lease term. For the performance of the installation service, the Company has one performance obligation, which is satisfied at the time of the applicable installation or augmentation and recognized as services and other revenues on the Company's condensed consolidated statement of ~~operations.~~operations and comprehensive income (loss). Since performance obligations are typically satisfied prior to receiving payment from tenants, the unconditional right to payment is recorded within "Receivables, net" on the Company’s condensed consolidated balance sheet. ~~The vast majority of~~Generally, the ~~Company’s~~ services ~~generally~~the Company provides to its tenants have a duration of one year or less.

Additional Information on Revenues

As of both January 1, ~~2022~~2023 and ~~September 30, 2022, $2.6~~March 31, 2023, $2.3 billion ~~and $2.4 billion, respectively,~~ of unrecognized ~~revenue was~~revenues were reported in "Deferred revenues" and "Other long-term liabilities" on the Company's condensed consolidated balance sheet. During the ~~nine~~three months ended ~~September 30,~~March 31, 2023, approximately $166 million of the January 1, 2023 unrecognized revenues balance was recognized as revenues. As of January 1, 2022, $2.6 billion of unrecognized revenues were reported in "Deferred revenues" and "Other long-term liabilities" on the Company's condensed consolidated balance sheet. During the three months ended March 31, 2022, approximately ~~$495~~$190 million of the January 1, 2022 unrecognized ~~revenue~~revenues balance was recognized as ~~revenue. During the nine months ended September 30, 2021, approximately $455 million of the January 1, 2021 unrecognized revenue balance was recognized as revenue.~~revenues.

The following table is a summary of the ~~non-cancelable~~ contracted amounts owed to the Company by tenants pursuant to tenant contracts in effect as of ~~September 30, 2022.~~March 31, 2023.

Three Months Ending December 31, Years Ending December 31,
2022 2023 2024 2025 2026 Thereafter Total
Contracted amounts(a)
$ 1,208 $ 4,760 $ 4,338 $ 4,010 $ 3,929 $ 22,736 $ 40,981


	Nine Months Ending December 31,		Years Ending December 31,
	2023		2024		2025		2026		2027		Thereafter		Total
Contracted amounts(a)	$	3,671	$	4,479	$	4,140	$	4,022	$	3,976	$	19,160	$	39,448

(a)Based on the nature of the contract, tenant contracts are accounted for pursuant to relevant lease accounting (ASC 842) or revenue accounting (ASC 606) guidance. Excludes amounts related to services, as those contracts generally have a duration of one year or less.

See note 10 for further information regarding the Company's operating segments.

109

4.Debt and Other Obligations

See note 12 for a discussion of the Company's issuance of the April 2023 Senior Notes (as defined in note 12) and the use of the net proceeds therefrom.

The table below sets forth the Company's debt and other obligations as of ~~September 30, 2022.~~March 31, 2023.


		Original Issue Date		Final Maturity Date(a)		Balance as of September 30, 2022			Balance as of December 31, 2021		Stated Interest Rate as of September 30, 2022(a)				Original Issue Date		Final Maturity Date(a)		Balance as of March 31, 2023			Balance as of December 31, 2022		Stated Interest Rate as of March 31, 2023(a)(b)
3.849% Secured Notes		Dec. 2012		Apr. 2023	(h)	$	—		$	998	N/A
Secured Notes, Series 2009-1, Class A-2	Secured Notes, Series 2009-1, Class A-2	July 2009		Aug. 2029		48			53		9.0	%		Secured Notes, Series 2009-1, Class A-2	July 2009		Aug. 2029		$	45		$	47	9.0	%

Tower Revenue Notes, Series 2018-1		July 2018		July 2043	(h)	—			249		N/A
Tower Revenue Notes, Series 2015-2	Tower Revenue Notes, Series 2015-2	May 2015		May 2045	(b)	697			696		3.7	%		Tower Revenue Notes, Series 2015-2	May 2015		May 2045	(c)	698			698		3.7	%
Tower Revenue Notes, Series 2018-2	Tower Revenue Notes, Series 2018-2	July 2018		July 2048	(b)	745			744		4.2	%		Tower Revenue Notes, Series 2018-2	July 2018		July 2048	(c)	745			745		4.2	%
Finance leases and other obligations	Finance leases and other obligations	Various		Various	(c)	239			242		Various		(c)	Finance leases and other obligations	Various	(d)	Various	(d)	257			246		Various		(d)
Total secured debt	Total secured debt					$	1,729		$	2,982				Total secured debt					1,745			1,736
2016 Revolver	2016 Revolver	Jan. 2016		July 2027	(e)	$	710	(d)	$	665	4.1	%	(e)	2016 Revolver	Jan. 2016		July 2027		1,434		(e)	1,305		5.9	%	(f)
2016 Term Loan A	2016 Term Loan A	Jan. 2016		July 2027	(e)	1,199			1,222		3.8	%	(e)	2016 Term Loan A	Jan. 2016		July 2027		1,184			1,192		6.0	%	(f)
Commercial Paper Notes	Commercial Paper Notes	Various	(f)	Various	(f)	1,594		(f)	265		3.8	%		Commercial Paper Notes	Various	(g)	Various	(g)	717		(g)	1,241		5.6	%
3.150% Senior Notes	3.150% Senior Notes	Jan. 2018		July 2023		749			747		3.2	%		3.150% Senior Notes	Jan. 2018		July 2023		749			749		3.2	%
3.200% Senior Notes	3.200% Senior Notes	Aug. 2017		Sept. 2024		748			747		3.2	%		3.200% Senior Notes	Aug. 2017		Sept. 2024		748			748		3.2	%
1.350% Senior Notes	1.350% Senior Notes	June 2020		July 2025		496			496		1.4	%		1.350% Senior Notes	June 2020		July 2025		497			497		1.4	%
4.450% Senior Notes	4.450% Senior Notes	Feb. 2016		Feb. 2026		896			895		4.5	%		4.450% Senior Notes	Feb. 2016		Feb. 2026		897			896		4.5	%
3.700% Senior Notes	3.700% Senior Notes	May 2016		June 2026		747			746		3.7	%		3.700% Senior Notes	May 2016		June 2026		747			747		3.7	%
1.050% Senior Notes	1.050% Senior Notes	Feb. 2021		July 2026		992			990		1.1	%		1.050% Senior Notes	Feb. 2021		July 2026		993			992		1.1	%
4.000% Senior Notes	4.000% Senior Notes	Feb. 2017		Mar. 2027		497			496		4.0	%		4.000% Senior Notes	Feb. 2017		Mar. 2027		497			497		4.0	%
2.900% Senior Notes	2.900% Senior Notes	Mar. 2022		Mar. 2027	(g)	742			—		2.9	%		2.900% Senior Notes	Mar. 2022		Mar. 2027		743			742		2.9	%
3.650% Senior Notes	3.650% Senior Notes	Aug. 2017		Sept. 2027		995			995		3.7	%		3.650% Senior Notes	Aug. 2017		Sept. 2027		996			996		3.7	%
5.000% Senior Notes														5.000% Senior Notes	Jan. 2023	(h)	Jan. 2028	(h)	990			—		5.0	%
3.800% Senior Notes	3.800% Senior Notes	Jan. 2018		Feb. 2028		993			992		3.8	%		3.800% Senior Notes	Jan. 2018		Feb. 2028		993			993		3.8	%
4.300% Senior Notes	4.300% Senior Notes	Feb. 2019		Feb. 2029		594			593		4.3	%		4.300% Senior Notes	Feb. 2019		Feb. 2029		595			594		4.3	%
3.100% Senior Notes	3.100% Senior Notes	Aug. 2019		Nov. 2029		545			545		3.1	%		3.100% Senior Notes	Aug. 2019		Nov. 2029		545			545		3.1	%
3.300% Senior Notes	3.300% Senior Notes	Apr. 2020		July 2030		739			738		3.3	%		3.300% Senior Notes	Apr. 2020		July 2030		740			739		3.3	%
2.250% Senior Notes	2.250% Senior Notes	June 2020		Jan. 2031		1,090			1,089		2.3	%		2.250% Senior Notes	June 2020		Jan. 2031		1,091			1,090		2.3	%
2.100% Senior Notes	2.100% Senior Notes	Feb. 2021		Apr. 2031		988			988		2.1	%		2.100% Senior Notes	Feb. 2021		Apr. 2031		989			989		2.1	%
2.500% Senior Notes	2.500% Senior Notes	June 2021		July 2031		741			741		2.5	%		2.500% Senior Notes	June 2021		July 2031		742			742		2.5	%
2.900% Senior Notes	2.900% Senior Notes	Feb. 2021		Apr. 2041		1,233			1,233		2.9	%		2.900% Senior Notes	Feb. 2021		Apr. 2041		1,234			1,233		2.9	%
4.750% Senior Notes	4.750% Senior Notes	May 2017		May 2047		344			344		4.8	%		4.750% Senior Notes	May 2017		May 2047		344			344		4.8	%
5.200% Senior Notes	5.200% Senior Notes	Feb. 2019		Feb. 2049		396			395		5.2	%		5.200% Senior Notes	Feb. 2019		Feb. 2049		396			396		5.2	%
4.000% Senior Notes	4.000% Senior Notes	Aug. 2019		Nov. 2049		346			345		4.0	%		4.000% Senior Notes	Aug. 2019		Nov. 2049		346			346		4.0	%
4.150% Senior Notes	4.150% Senior Notes	Apr. 2020		July 2050		490			490		4.2	%		4.150% Senior Notes	Apr. 2020		July 2050		490			490		4.2	%
3.250% Senior Notes	3.250% Senior Notes	June 2020		Jan. 2051		890			890		3.3	%		3.250% Senior Notes	June 2020		Jan. 2051		890			890		3.3	%
Total unsecured debt	Total unsecured debt					$	19,754		$	17,647				Total unsecured debt					20,587			19,993
Total debt and other obligations	Total debt and other obligations					21,483			20,629					Total debt and other obligations					22,332			21,729
Less: current maturities of debt and other obligations	Less: current maturities of debt and other obligations					819			72					Less: current maturities of debt and other obligations					819			819
Non-current portion of debt and other long-term obligations	Non-current portion of debt and other long-term obligations					$	20,664		$	20,557				Non-current portion of debt and other long-term obligations					$	21,513		$	20,910

(a)See the ~~2021~~2022 Form 10-K, including note 7 to the consolidated financial statements, for additional information regarding the maturity and principal amortization provisions and interest rates relating to the Company's indebtedness.

(b)Represents the weighted-average stated interest rate, as applicable.

(c)If the ~~respective series of~~ Tower Revenue Notes, Series 2015-2 and Series 2018-2 (collectively, "Tower Revenue Notes") are not paid in full on or prior to an applicable anticipated repayment date, then Excess Cash Flow (as defined in the ~~indenture)~~indenture governing the terms of such notes) of the issuers of such notes will be used to repay principal of the applicable series and class of the Tower Revenue Notes, and additional interest (of an additional approximately 5% per annum) will accrue on the respective Tower Revenue Notes. As of ~~September 30, 2022,~~March 31, 2023, the Tower Revenue Notes, Series 2015-2 and Series 2018-2 have principal amounts of $700 million and $750 million, with anticipated repayment dates in 2025 and 2028, respectively.

~~(c)~~(d)The Company's finance leases and other obligations relate to land, fiber, vehicles, and other assets and bear interest rates ~~ranging~~ up to 10% and mature in periods ranging from less than one year to approximately 25 years.

~~(d)~~(e)As of ~~September 30, 2022,~~March 31, 2023, the undrawn availability under the Company's senior unsecured revolving credit facility ("2016 ~~Revolver~~Revolver") was ~~$6.3~~$5.5 billion.

~~(e)~~In July 2022, the Company entered into an amendment to the Credit Agreement governing the Company's 2016 Credit Facility ("2022 Credit Agreement Amendment") that provided for, among other things, (1) the extension of the maturity date of the 2016 Credit Facility from June 2026 to July 2027, (2) an increase to the aggregate commitments under the 2016 Revolver from $5.0 billion to $7.0 billion, (3) certain modifications to a specified sustainability See note 12.

1110

~~metric and (4) the replacement of the LIBOR pricing benchmark with a Term SOFR pricing benchmark.~~ (f)Both the 2016 Revolver and the senior unsecured term loan A facility ("2016 Term Loan AA" and, collectively, "2016 Credit Facility") bear interest, at the Company's option, at either (1) Term SOFR plus (i) a credit spread adjustment of 0.10% per annum and (ii) a credit spread ranging from 0.875% to 1.750% per annum or (2) an alternate base rate plus a credit spread ranging from 0.000% to 0.750% per annum, in each case, with the applicable credit spread based on the Company's senior unsecured debt rating. The Company pays a commitment fee ranging from 0.080% to 0.300%, based on the Company's senior unsecured debt rating, per annum on the undrawn available amount under the 2016 Revolver. See the ~~2021~~2022 Form 10-K, including note 7 to the consolidated financial statements, for information regarding potential adjustments to such percentages.

~~(f)~~(g)In March 2022, the Company increased the size of its CP Program to permit the issuance of Commercial Paper Notes in an aggregate principal amount not to exceed $2.0 billion at any time outstanding. Notes under the CP Program may be issued, repaid and re-issued from time to time. The net proceeds of the Commercial Paper Notes are expected to be used for general corporate purposes. The maturities of the Commercial Paper Notes, when outstanding, may vary but may not exceed 397 days from the date of issue. The Commercial Paper Notes are issued under customary terms in the commercial paper market and are issued at a discount from par or, alternatively, can be issued at par and bear varying interest rates on a fixed or floating basis. As of ~~September 30, 2022,~~March 31, 2023, the Company had net issuances of ~~$1.6 billion~~$717 million under the CP Program. At any point in time, the Company intends to maintain available commitments under its 2016 Revolver in an amount at least equal to the amount of Commercial Paper Notes outstanding. While any outstanding Commercial Paper Notes generally have short-term maturities, the Company classifies the outstanding issuances, when applicable, as long-term based on its ability and intent to refinance the outstanding issuances on a long-term basis.

~~(g)~~(h)In ~~March 2022,~~January 2023, the Company issued ~~$750 million~~$1.0 billion aggregate principal amount of ~~2.900%~~5.000% senior unsecured notes due ~~2027~~January 2028 ("~~March 2022~~January 2023 Senior Notes"). The Company used the net proceeds from the ~~March 2022~~January 2023 Senior Notes offering to repay a portion of the outstanding indebtedness under ~~its CP Program~~the 2016 Revolver and pay related fees and expenses.

~~(h)In March 2022, the Company (1) prepaid in full the previously outstanding Tower Revenue Notes, Series 2018-1 and (2) redeemed in full the previously outstanding 3.849% Secured Notes.~~

Scheduled Principal Payments and Final Maturities

The following are the scheduled principal payments and final maturities of the total debt and other long-term obligations of the Company outstanding as of ~~September 30, 2022,~~March 31, 2023, which do not consider the principal payments that will commence following the anticipated repayment dates on the Tower Revenue Notes.

Three Months Ending December 31, Years Ending December 31, Total Cash Obligations Unamortized Adjustments, Net Total Debt and Other Obligations Outstanding
2022 2023 2024 2025 2026 Thereafter
Scheduled principal payments and
final maturities
$ 1,614 (a) $ 819 $ 830 $ 591 $ 2,770

$ 15,017 $ 21,641 $ (158) $ 21,483


	Nine Months Ending December 31,			Years Ending December 31,										Total Cash Obligations		Unamortized Adjustments, Net		Total Debt and Other Obligations Outstanding
	2023			2024		2025		2026		2027		Thereafter
Scheduled principal payments and final maturities	$	1,520	(a)	$	832	$	594	$	2,773	$	4,678	$	12,091	$	22,488	$	(156)	$	22,332

(a)Predominately consists of outstanding indebtedness under the CP Program ~~(as~~as discussed in footnote ~~(f) above)~~(g) of the preceding table and $750 million aggregate principal amount of 3.150% senior unsecured notes ("3.150% Senior Notes").

Purchases and Redemptions of Long-Term Debt

~~The following is a summary of~~There were no purchases and redemptions of long-term debt during the ~~nine~~three months ended ~~September 30, 2022.~~

Principal Amount
Cash Paid(a)
Gains (Losses)(b)
Tower Revenue Notes, Series 2018-1 $ 250 $ 252 $ (3)
3.849% Secured Notes 1,000 1,022 (23)
2016 Revolver — — (2)
Total $ 1,250 $ 1,274 $ (28)

~~(a)Exclusive of accrued interest.~~

~~(b)Inclusive of the write off of respective deferred financing costs.~~March 31, 2023.

Interest Expense and Amortization of Deferred Financing Costs, Net

The components of interest expense and amortization of deferred financing costs, net are as follows:


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
		2022		2021		2022		2021			2023		2022
Interest expense on debt obligations	Interest expense on debt obligations	$	174	$	160	$	496	$	484	Interest expense on debt obligations	$	198	$	160
Amortization of deferred financing costs and adjustments on long-term debt, net		6		6		19		19
Amortization of deferred financing costs and adjustments on long-term debt										Amortization of deferred financing costs and adjustments on long-term debt	7		7
Capitalized interest	Capitalized interest	(3)		(3)		(9)		(10)		Capitalized interest	(3)		(3)
Total	Total	$	177	$	163	$	506	$	493	Total	$	202	$	164

5.Fair Value Disclosures


		Level in Fair Value Hierarchy		September 30, 2022						December 31, 2021						Level in Fair Value Hierarchy			March 31, 2023						December 31, 2022
			Carrying Amount			Fair Value			Carrying Amount			Fair Value						Carrying Amount			Fair Value			Carrying Amount			Fair Value
Assets:	Assets:																Assets:
Cash and cash equivalents	Cash and cash equivalents	1		$	174		$	174		$	292		$	292	Cash and cash equivalents	1			$	187		$	187		$	156		$	156
Restricted cash, current and non-current	Restricted cash, current and non-current	1		173			173			174			174		Restricted cash, current and non-current	1			201			201			171			171

Liabilities:	Liabilities:														Liabilities:
Total debt and other obligations	Total debt and other obligations	2		21,483			18,926			20,629			21,588		Total debt and other obligations	2			22,332			20,403			21,729			19,554

The fair ~~value~~values of cash and cash equivalents and restricted cash approximate the carrying ~~value.~~values. The Company determines the fair value of its debt securities based on indicative, non-binding quotes from brokers. Quotes from brokers require judgment and are based on the brokers' interpretation of market information, including implied credit spreads for similar borrowings on recent trades or bid/ask prices or quotes from active markets if available. Since December 31, ~~2021,~~2022, there have been no changes in the Company's valuation techniques used to measure fair values.

6.Income Taxes

The Company operates as a REIT for U.S. federal income tax purposes. As a REIT, the Company is generally entitled to a deduction for dividends that it pays and, therefore, is not subject to U.S. federal corporate income tax on its net taxable income that is currently distributed to its stockholders. The Company ~~also~~ may be subject to certain federal, state, local and foreign taxes on its income, ~~and assets,~~ including (1) taxes on any undistributed income and (2) taxes related to the ~~TRSs, (3) franchise taxes, (4) property taxes, and (5) transfer taxes.~~TRSs. In addition, the Company could, under certain circumstances, be required to pay an excise or penalty tax, which could be significant in amount, in order to utilize one or more relief provisions under the Internal Revenue Code of 1986, as amended, to maintain qualification for taxation as a REIT.

The Company's TRS assets and operations will continue to be subject, as applicable, to federal and state corporate income taxes or to foreign taxes in the jurisdictions in which such assets and operations are located. The Company's foreign assets and operations (including its tower operations in Puerto Rico) are subject to foreign income taxes in the jurisdictions in which such assets and operations are located, regardless of whether they are included in a TRS or not.

For the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ the Company's effective tax rate differed from the federal statutory rate predominately due to the Company's REIT status, including the dividends paid deduction.

7.Per Share Information

Basic net income (loss), per common share, excludes dilution and is computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the period. For the three ~~and nine~~ months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ diluted net income (loss), per common share, is computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the period, plus any potential dilutive common share equivalents, including shares issuable upon the vesting of restricted stock units ("RSUs") as determined under the treasury stock method.

Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 2022 2021
Income (loss) from continuing operations for basic and diluted computations $ 419 $ 351 $ 1,261 $ 805
Income (loss) from discontinued operations, net of tax — — — (62)
Net income (loss) $ 419 $ 351 $ 1,261 $ 743
Weighted-average number of common shares outstanding (in millions):
Basic weighted-average number of common stock outstanding 433 432 433 432
Effect of assumed dilution from potential issuance of common shares relating to restricted stock units 1 2 1 2
Diluted weighted-average number of common shares outstanding 434 434 434 434
Net income (loss), per common share:
Income (loss) from continuing operations, basic $ 0.97 $ 0.81 $ 2.91 $ 1.86
Income (loss) from discontinued operations, basic — — — (0.14)
Net income (loss)—basic $ 0.97 $ 0.81 $ 2.91 $ 1.72
Income (loss) from continuing operations, diluted $ 0.97 $ 0.81 $ 2.91 $ 1.85
Income (loss) from discontinued operations, diluted — — — (0.14)
Net income (loss)—diluted $ 0.97 $ 0.81 $ 2.91 $ 1.71
Dividends/distributions declared per share of common stock $ 1.47 $ 1.33 $ 4.41 $ 3.99


	Three Months Ended March 31,
		2023		2022
Net income (loss)		$	418	$	421

Weighted-average number of common shares outstanding (in millions):
Basic weighted-average number of common stock outstanding		433		433
Effect of assumed dilution from potential issuance of common shares relating to restricted stock units		1		1
Diluted weighted-average number of common shares outstanding		434		434

Net income (loss), per common share:
Basic		$	0.97	$	0.97
Diluted		$	0.97	$	0.97

Dividends/distributions declared per share of common stock		$	1.565	$	1.470

During the ~~nine~~three months ended ~~September 30, 2022,~~March 31, 2023, the Company granted one million ~~restricted stock units~~RSUs to the Company's executives and certain other employees.

8.Commitments and Contingencies

Durham Lawsuits

The Company has received notices of claims and has been named as one of several defendants in lawsuits stemming from an April 2019 gas leak explosion in Durham, North Carolina, which occurred near an area where the Company's subcontractors were installing fiber. The explosion resulted in two fatalities, physical injuries (some of which were serious), and property damage to surrounding buildings and businesses. ~~Currently,~~All of the ~~Company is unable to determine~~claims have been resolved without any material payment by the ~~likelihood of an outcome or estimate a range of possible losses, if any, related to these lawsuits.~~Company.

Other Matters

The Company is involved in various other claims, assessments, lawsuits or proceedings arising in the ordinary course of business. While there are uncertainties inherent in the ultimate outcome of such other matters and it is impossible to presently determine the ultimate costs or losses that may be incurred, if any, management believes the adverse resolution of such uncertainties and the incurrence of such costs should not have a material adverse effect on the Company's condensed consolidated financial position or results of operations. ~~Additionally, the~~The Company and certain of its subsidiaries are also contingently liable for commitments or performance guarantees arising in the ordinary course of business, including certain letters of credit or surety bonds. In addition, ~~see~~as mentioned in note 1, ~~for a discussion of~~ the ~~Company's~~Company has the option to purchase approximately 53% of its towers at the end of their respective lease terms. The Company has no obligation to exercise such purchase options.

9.Equity

Declaration and Payment of Dividends

During the ~~nine~~three months ended ~~September 30, 2022,~~March 31, 2023, the following dividends/distributions were declared or paid:

Equity Type

Declaration Date

Record Date

Payment Date

Dividends Per Share

Aggregate

Payment

Amount(a)

Equity Type

Declaration Date

Record Date

Payment Date

Dividends Per Share

Aggregate

Payment

Amount(a)

Common Stock

February 8, 2022

March 15, 2022

March 31, 2022

1.47

639

Common Stock

February 7, 2023

March 15, 2023

March 31, 2023

1.565

681

Common Stock

May 9, 2022

June 15, 2022

June 30, 2022

1.47

638

Common Stock

July 25, 2022

September 15, 2022

September 30, 2022

1.47

636

(a)Inclusive of dividends accrued for holders of unvested ~~restricted stock units,~~RSUs, which will be paid when and if the ~~restricted stock units~~RSUs vest.

See also note 12 for a discussion of the Company's common stock dividend declared in ~~October 2022.~~May 2023.

Purchases of the Company's Common Stock

For the ~~nine~~three months ended ~~September 30, 2022,~~March 31, 2023, the Company purchased ~~0.4~~0.2 million shares of its common stock utilizing ~~$64~~$28 million in cash. The shares of common stock purchased relate to shares withheld in connection with the payment of withholding taxes upon vesting of ~~restricted stock units.~~RSUs.

2021 "At-the-Market" Stock Offering Program

In March 2021, the Company established an "at-the-market" stock offering program through which it may issue and sell shares of its common stock having an aggregate gross sales price of up to $750 million ("2021 ATM Program"). Sales under the 2021 ATM Program may be made by means of ordinary brokers' transactions on the NYSE or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or, subject to the Company's specific instructions, at negotiated prices. The Company intends to use the net proceeds from any sales under the 2021 ATM Program for general corporate purposes, which may include (1) the funding of future acquisitions or investments or (2) the repayment or repurchase of any outstanding indebtedness. The Company has not sold any shares of common stock under the 2021 ATM Program.

10.Operating Segments

The Company's operating segments consist of (1) Towers and (2) Fiber. The Towers segment provides access, including space or capacity, to the Company's more than 40,000 towers geographically dispersed throughout the U.S. The Towers segment also reflects certain ancillary services relating to the Company's towers, predominately consisting of site development services and installation services. The Fiber segment provides access, including space or capacity, to the Company's approximately (1) 120,000 small cells on air or under contract and (2) 85,000 route miles of fiber primarily supporting small ~~cell networks~~cells and fiber solutions geographically dispersed throughout the U.S.

The measurements of profit or loss used by the Company's chief operating decision maker ("CODM") to evaluate the performance of its operating segments are (1) segment site rental gross margin, (2) segment services and other gross margin and (3) segment operating ~~profit.~~profit (loss). The Company defines segment site rental gross margin as segment site rental revenues less segment site rental costs of operations, excluding stock-based compensation expense, net and amortization of prepaid lease purchase price adjustments recorded in consolidated site rental costs of operations. The Company defines segment services and other gross margin as segment services and other revenues less segment services and other costs of operations, excluding stock-based compensation expense, net recorded in consolidated services and other costs of operations. The Company defines segment operating profit (loss) as segment site rental gross margin plus segment services and other gross margin, and segment other operating (income) expense, less segment selling, general and administrative ~~expenses attributable to the respective segment.~~expenses. All of these measurements of profit or loss are exclusive of depreciation, amortization and accretion, which are shown separately.

The following tables set forth the Company's segment operating results for the three ~~and nine~~ months ended ~~September 30, 2022~~March 31, 2023 and ~~2021.~~2022. Costs that are directly attributable to Towers and Fiber are assigned to those respective segments. Additionally, certain costs are shared across segments and are reflected in the Company's segment measures through allocations that management believes to be reasonable. The "Other" column (1) represents amounts excluded from specific segments, such as certain selling, general and administrative expenses, asset write-down charges, acquisition and integration costs, depreciation, amortization and accretion, amortization of prepaid lease purchase price adjustments, interest expense and amortization of deferred financing costs, net, gains (losses) on retirement of long-term obligations, interest income, other income (expense), ~~income (loss) from discontinued~~

~~operations,~~ and stock-based compensation expense, net and (2) reconciles segment operating profit (loss) to income (loss) before income taxes, as the amounts are not utilized in assessing each segment’s performance. The "Other" total assets balance includes corporate assets such as cash and cash equivalents which have not been allocated to specific segments. There are no significant revenues resulting from transactions between the Company's operating segments.

Three Months Ended September 30, 2022 Three Months Ended September 30, 2021
Towers Fiber Other Consolidated
Total Towers Fiber Other Consolidated
Total
Segment site rental revenues $ 1,084 $ 484 $ 1,568 $ 972 $ 479 $ 1,451
Segment services and other revenues 175 3 178 162 5 167
Segment revenues 1,259 487 1,746 1,134 484 1,618
Segment site rental costs of operations 230 166 396 227 163 390
Segment services and other costs of operations 114 3 117 108 4 112
Segment costs of operations(a)(b)
344 169 513 335 167 502
Segment site rental gross margin 854 318 1,172 745 316 1,061
Segment services and other gross margin 61 — 61 54 1 55
Segment selling, general and administrative expenses(b)
28 47 75 27 44 71
Segment operating profit (loss) 887 271 1,158 772 273 1,045
Other selling, general and administrative expenses(b)
$ 81 81 $ 69 69
Stock-based compensation expense 38 38 33 33
Depreciation, amortization and accretion 430 430 413 413
Interest expense and amortization of deferred financing costs 177 177 163 163
Other (income) expenses to reconcile to income (loss) before income taxes(c)
10 10 9 9
Income (loss) before income taxes $ 422 $ 358
Capital expenditures $ 45 $ 277 $ 15 $ 337 $ 46 $ 229 $ 8 $ 283
Total assets (at period end) $ 22,226 $ 15,914 $ 721 $ 38,861 $ 22,239 $ 15,813 $ 952 $ 39,004

~~(a)Exclusive of depreciation, amortization and accretion shown separately.~~

~~(b)~~Segment costs of operations excludes (1) stock-based compensation of $7 million and $6 million for the three months ended September 30, 2022 and 2021, respectively and (2) prepaid lease purchase price adjustments of $4 million for each of the three months ended September 30, 2022 and 2021. Selling, general and administrative expenses exclude stock-based compensation expense of $31 million and $27 million for the three months ended September 30, 2022 and 2021, respectively.

~~(c)See condensed consolidated statement of operations for further information.~~


		Nine Months Ended September 30, 2022								Nine Months Ended September 30, 2021									Three Months Ended March 31, 2023								Three Months Ended March 31, 2022
		Towers		Fiber		Other		Consolidated Total		Towers		Fiber		Other		Consolidated Total			Towers		Fiber		Other		Consolidated Total		Towers		Fiber		Other		Consolidated Total
Segment site rental revenues	Segment site rental revenues	$	3,237	$	1,474			$	4,711	$	2,819	$	1,426			$	4,245	Segment site rental revenues	$	1,081	$	543			$	1,624	$	1,075	$	501			$	1,576
Segment services and other revenues	Segment services and other revenues	502		9				511		427		14				441		Segment services and other revenues	146		3				149		163		3				166
Segment revenues	Segment revenues	3,739		1,483				5,222		3,246		1,440				4,686		Segment revenues	1,227		546				1,773		1,238		504				1,742
Segment site rental costs of operations	Segment site rental costs of operations	689		490				1,179		659		485				1,144		Segment site rental costs of operations	234		172				406		225		162				387
Segment services and other costs of operations	Segment services and other costs of operations	329		7				336		285		10				295		Segment services and other costs of operations	99		2				101		109		2				111
Segment costs of operations(a)(b)	Segment costs of operations(a)(b)	1,018		497				1,515		944		495				1,439		Segment costs of operations(a)(b)	333		174				507		334		164				498
Segment site rental gross margin	Segment site rental gross margin	2,548		984				3,532		2,160		941				3,101		Segment site rental gross margin	847		371				1,218		850		339				1,189
Segment services and other gross margin	Segment services and other gross margin	173		2				175		142		4				146		Segment services and other gross margin	47		1				48		54		1				55
Segment selling, general and administrative expenses(b)	Segment selling, general and administrative expenses(b)	84		140				224		78		133				211		Segment selling, general and administrative expenses(b)	31		49				80		28		47				75
Segment operating profit (loss)	Segment operating profit (loss)	2,637		846				3,483		2,224		812				3,036		Segment operating profit (loss)	863		323				1,186		876		293				1,169
Other selling, general and administrative expenses(b)	Other selling, general and administrative expenses(b)					$	234	234						$	205	205		Other selling, general and administrative expenses(b)					$	82	82						$	74	74
Stock-based compensation expense						121		121						100		100
Stock-based compensation expense, net																		Stock-based compensation expense, net					41		41						39		39
Depreciation, amortization and accretion	Depreciation, amortization and accretion					1,276		1,276						1,229		1,229		Depreciation, amortization and accretion					431		431						420		420
Interest expense and amortization of deferred financing costs						506		506						493		493
Interest expense and amortization of deferred financing costs, net																		Interest expense and amortization of deferred financing costs, net					202		202						164		164
Other (income) expenses to reconcile to income (loss) before income taxes(c)	Other (income) expenses to reconcile to income (loss) before income taxes(c)					71		71						184		184		Other (income) expenses to reconcile to income (loss) before income taxes(c)					5		5						45		45
Income (loss) before income taxes	Income (loss) before income taxes							$	1,275							$	825	Income (loss) before income taxes							$	425							$	427
Capital expenditures	Capital expenditures	$	137	$	746	$	38	$	921	$	160	$	701	$	31	$	892	Capital expenditures	$	50	$	279	$	12	$	341	$	47	$	222	$	12	$	281
Total assets (at period end)																		Total assets (at period end)	$	22,185	$	16,091	$	778	$	39,054	$	22,330	$	15,839	$	882	$	39,051

(a)Exclusive of depreciation, amortization and accretion shown separately.

(b)Segment costs of operations excludes (1) stock-based compensation expense, net of ~~$21~~$8 million and ~~$16~~$7 million for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ respectively, and (2) prepaid lease purchase price adjustments of ~~$12 million and $14~~$4 million for each of the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 and ~~2021, respectively. Selling,~~2022. Segment selling, general and administrative expenses and other selling, general and administrative expenses exclude stock-based compensation expense, net of ~~$100~~$33 million and ~~$84~~$32 million for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ respectively.

(c)See condensed consolidated statement of operations and comprehensive income (loss) for further information.

1814

11.Supplemental Cash Flow Information

The following table is a summary of the Company's supplemental cash flow ~~information:~~information for the three months ended March 31, 2023 and 2022:


		Nine Months Ended September 30,					Three Months Ended March 31,
		2022		2021			2023		2022
Supplemental disclosure of cash flow information:	Supplemental disclosure of cash flow information:					Supplemental disclosure of cash flow information:
Cash payments related to operating lease liabilities(a)	Cash payments related to operating lease liabilities(a)	$	420	$	414	Cash payments related to operating lease liabilities(a)	$	142	$	139
Interest paid	Interest paid	559		542		Interest paid	249		225
Income taxes paid		10		17
Income taxes paid (refunded)						Income taxes paid (refunded)	(2)		—
Supplemental disclosure of non-cash operating, investing and financing activities:	Supplemental disclosure of non-cash operating, investing and financing activities:					Supplemental disclosure of non-cash operating, investing and financing activities:
New ROU assets obtained in exchange for operating lease liabilities	New ROU assets obtained in exchange for operating lease liabilities	162		456		New ROU assets obtained in exchange for operating lease liabilities	30		140
Increase (decrease) in accounts payable for purchases of property and equipment	Increase (decrease) in accounts payable for purchases of property and equipment	(7)		(13)		Increase (decrease) in accounts payable for purchases of property and equipment	2		(8)
Purchase of property and equipment under finance leases and installment purchases		17		22
Purchase of property and equipment under finance leases and installment land purchases						Purchase of property and equipment under finance leases and installment land purchases	21		1

(a)Excludes the Company's contingent payments pursuant to operating leases, which are recorded as expense in the period such contingencies are resolved.

The reconciliation of cash, cash equivalents and restricted cash reported within various lines on the condensed consolidated balance sheet to amounts reported in the condensed consolidated statement of cash flows is shown below.


		September 30, 2022		December 31, 2021			March 31, 2023		December 31, 2022
Cash and cash equivalents	Cash and cash equivalents	$	174	$	292	Cash and cash equivalents	$	187	$	156
Restricted cash, current	Restricted cash, current	168		169		Restricted cash, current	196		166
Restricted cash reported within other assets, net	Restricted cash reported within other assets, net	5		5		Restricted cash reported within other assets, net	5		5
Cash, cash equivalents and restricted cash	Cash, cash equivalents and restricted cash	$	347	$	466	Cash, cash equivalents and restricted cash	$	388	$	327

12.Subsequent Events

Common Stock Dividend

On ~~October 18, 2022,~~May 1, 2023, the Company's board of directors declared a quarterly cash dividend of $1.565 per common share. The quarterly dividend will be payable on ~~December~~June 30, ~~2022~~2023 to common stockholders of record as of ~~December~~June 15, ~~2022.~~2023.

April 2023 Senior Notes Offering

On April 26, 2023, the Company issued $600 million aggregate principal amount of 4.800% senior unsecured notes due 2028 and $750 million aggregate principal amount of 5.100% senior unsecured notes due 2033 (collectively, "April 2023 Senior Notes"). The Company used the net proceeds from the April 2023 Senior Notes offering to repay a portion of the outstanding indebtedness under the 2016 Revolver and pay related fees and expenses.

1915

ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the response to Part I, Item 1 of this report and the consolidated financial statements of the Company including the related notes and "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" ("MD&A") included in the ~~2021~~2022 Form 10-K.

General Overview

Overview

We own, operate and lease shared communications infrastructure that is geographically dispersed throughout the U.S., including (1) more than 40,000 towers and other structures, such as rooftops (collectively, "towers"), (2) approximately 120,000 small cells on air or under contract and (3) approximately 85,000 route miles of fiber primarily supporting small cells and fiber solutions.

Our towers have a significant presence in each of the top 100 basic trading areas ("BTAs"), and the majority of our small cells and fiber assets are located in major metropolitan ~~areas.~~areas, including a presence within every major U.S. market. Site rental revenues represented ~~90%~~92% of our ~~third~~first quarter ~~2022~~2023 consolidated net ~~revenues. Our~~revenues, of which 67% and 33% were from our Towers segment and Fiber segment, ~~accounted for 69% and 31%, respectively, of our third quarter 2022 site rental revenues.~~respectively. Within our Fiber segment, ~~68%~~71% and ~~32%~~29% of our ~~third~~first quarter ~~2022~~2023 Fiber site rental revenues related to fiber solutions and small cells, respectively. See note 10 to our condensed consolidated financial statements. The vast majority of our site rental revenues are of a recurring nature and are derived from long-term tenant ~~contracts with our tenants.~~contracts.

Strategy

As a leading provider of shared communications infrastructure in the U.S., our strategy is to create long-term stockholder value via a combination of (1) growing cash flows generated from our existing portfolio of communications infrastructure, (2) returning a meaningful portion of our cash generated by operating activities to our common stockholders in the form of dividends and (3) investing capital efficiently to grow cash flows and long-term dividends per share. Our strategy is based, in part, on our belief that the U.S. is the most attractive market for shared communications infrastructure investment with the greatest long-term growth potential. We measure our efforts to create "long-term stockholder value" by the combined payment of dividends to stockholders and growth in our per-share results. The key elements of our strategy are to:

•Grow cash flows from our existing communications infrastructure. We are focused on maximizing the recurring site rental cash flows generated from providing our tenants with long-term access to our shared infrastructure assets, which we believe is the core driver of value for our stockholders. Tenant additions or modifications of existing tenant equipment (collectively, "tenant additions") enable our tenants to expand coverage and capacity in order to meet increasing demand for data while generating high incremental returns for our business. We believe our product offerings of towers and small cells ~~provide a comprehensive solution to our wireless tenants' growing network needs~~ through our shared communications infrastructure model ~~which is an~~provide a comprehensive, efficient and cost-effective ~~way to serve~~solution for our ~~tenants.~~wireless tenants' growing networks. Additionally, we believe our ability to share our fiber assets across multiple tenants to both deploy ~~both~~ small cells and offer fiber solutions allows us to generate cash flows and increase stockholder return.

•Return cash generated by operating activities to common stockholders in the form of dividends. We believe that distributing a meaningful portion of our cash generated by operating activities appropriately provides common stockholders with increased certainty for a portion of expected long-term stockholder value while still allowing us to retain sufficient flexibility to invest in our business and deliver growth. We believe this decision reflects the translation of the high-quality, long-term contractual cash flows of our business into stable capital returns to common stockholders.

•Invest capital efficiently to grow cash flows and long-term dividends per share. In addition to adding tenants to existing communications infrastructure, we seek to invest our available capital, including the net cash generated by our operating activities and external financing sources, in a manner that will increase long-term stockholder value on a risk-adjusted basis. These investments include constructing and acquiring new communications infrastructure that we expect will generate future cash flow growth and attractive long-term returns by adding tenants to those assets over time. Our historical investments have included the following (in no particular order):

◦construction of towers, fiber and small cells;

◦acquisitions of towers, fiber and small cells;

◦acquisitions of land interests (which primarily relate to land assets under towers);

◦improvements and structural enhancements to our existing communications infrastructure;

◦purchases of shares of our common stock from time to time; and

◦purchases, repayments or redemptions of our debt.

Our strategy to create long-term stockholder value is based on our belief that there will be considerable future demand for our communications infrastructure based on the location of our assets and the rapid and continuing growth in the demand for data. We believe that such demand for our communications infrastructure will continue, will result in growth of our cash flows due to tenant additions on our existing communications infrastructure, and will create other growth opportunities for us, such as demand for newly constructed or acquired communications infrastructure, as described above. Further, we seek to augment the long-term value creation associated with growing our recurring site rental cash flows by offering certain ancillary site development and installation services within our Towers segment.

Highlights of Business Fundamentals and Results

•We operate as a REIT for U.S. federal income tax purposes

◦As a REIT, we are generally entitled to a deduction for dividends that we pay and, therefore, are not subject to U.S. federal corporate income tax on our net taxable income that is currently distributed to our stockholders.

◦To remain qualified and be taxed as a REIT, we will generally be required to annually distribute to our stockholders at least 90% of our REIT taxable income, after the utilization of our NOLs (determined without regard to the dividends paid deduction and excluding net capital gain).

◦See note 6 to our condensed consolidated financial statements for further discussion of our REIT status.

•Potential growth resulting from the increasing demand for data

◦We expect existing and potential new tenant demand for our communications infrastructure will result from (1) new technologies, (2) increased usage of mobile entertainment, mobile internet, and machine-to-machine applications, (3) adoption of other emerging and embedded wireless devices (including smartphones, laptops, tablets, wearables and other devices), (4) increasing smartphone penetration, (5) wireless carrier focus on expanding both network quality and capacity, including the use of both towers and small cells, (6) the adoption of other bandwidth-intensive applications (such as cloud services and video communications), (7) the availability of additional spectrum and (8) increased government initiatives to support connectivity throughout the U.S.

◦We expect U.S. wireless carriers will continue to focus on improving network quality and expanding capacity (including through 5G initiatives) by utilizing a combination of towers and small cells. We believe our product offerings of towers and small cells provide a comprehensive solution to our wireless tenants' growing communications infrastructure needs.

◦We expect organizations will continue to increase the usage of high-bandwidth applications that will require the utilization of more fiber infrastructure and fiber solutions, such as those we provide.

◦Within our Fiber segment, we are able to generate growth and returns for our stockholders by deploying our fiber for both small cells and fiber solutions tenants.

◦Tenant additions on our existing communications infrastructure are achieved at a low incremental operating cost, delivering high incremental returns.

•Substantially all of our communications infrastructure can accommodate additional tenancy, either as currently constructed or with appropriate modifications.

•Investing capital efficiently to grow long-term dividends per share (see also "Item 2. MD&A—General Overview—Strategy")

◦~~Discretionary~~We had discretionary capital expenditures of ~~$856~~$326 million for the ~~nine~~three months ended ~~September 30, 2022,~~March 31, 2023, predominately resulting from the construction of new communications infrastructure and improvements to existing communications infrastructure in order to support additional tenants.

◦We expect to continue to construct and acquire new communications infrastructure based on our tenants' needs and generate attractive long-term returns by adding additional tenants over time.

•Site rental revenues under long-term tenant contracts

◦~~Initial~~Our wireless tenant contracts have initial terms of five to 15 years, ~~for site rental revenues derived from wireless tenants,~~ with contractual ~~escalations~~escalators and multiple renewal periods of five to 10 years each, exercisable at the option of the ~~tenant, of five to 10 years each.~~

•On January 6, 2022, we entered into a 12-year agreement with T-Mobile ("T-Mobile Agreement"), which includes contracted new tower leasing activity and a base escalator that is consistent with historical levels for our Towers segment. The T-Mobile Agreement also includes a contractual commitment by T-Mobile for 35,000 new small cell nodes, including specific commitments in each of the next five years.tenant.

◦~~Initial~~Our fiber solutions tenant contracts' initial terms ~~that~~ generally vary between three to 20 ~~years for site rental revenues derived from our fiber solutions tenants (including from organizations with high-bandwidth and multi-location demands).~~years.

2117

◦~~Weighted-average~~As of March 31, 2023, our weighted-average remaining term ofwas approximately ~~seven~~six years, exclusive of renewals exercisable at the tenants' option, currently representing approximately ~~$41~~$39.4 billion of expected future cash inflows.

•Majority of our revenues from large wireless carriers

◦~~Approximately~~For the three months ended March 31, 2023, approximately three-fourths of our site rental revenues were derived from T-Mobile, AT&T and Verizon ~~Wireless for the nine months ended September 30, 2022.~~Wireless.

•Majority of land under our towers under long-term control

◦~~Approximately~~For the three months ended March 31, 2023, approximately 90% of our ~~Towers~~towers site rental gross margin and approximately 80% of our ~~Towers~~towers site rental gross margin iswas derived from towers located on land that we own or control for greater than 10 and 20 years, respectively. The aforementioned percentages include towers located on land that is owned, including through fee interests and perpetual easements, which ~~represent~~represented approximately 40% of our ~~Towers~~towers site rental gross margin.

•Majority of our fiber assets are located in major metropolitan areas and are on public ~~rights-of-way.~~rights-of-way

•Minimal sustaining capital expenditure requirements

◦~~Sustaining~~For the three months ended March 31, 2023, sustaining capital expenditures represented approximately 1% of net revenues.

•Debt portfolio with long-dated maturities extended over multiple years, with the vast majority of such debt having a fixed rate (see note 4 to our condensed consolidated financial statements and "Item 3. Quantitative and Qualitative Disclosures About Market Risk" for a further discussion of our debt)

◦As of ~~September 30, 2022,~~March 31, 2023, after giving effect to our $600 million aggregate principal amount of 4.800% senior unsecured notes due 2028 and $750 million aggregate principal amount of 5.100% senior unsecured notes due 2033 (collectively, "April 2023 Senior Notes") and the use of proceeds therefrom, our outstanding debt had a weighted-average interest rate of ~~3.3%~~3.7% and weighted-average maturity of approximately ~~eight~~nine years (assuming anticipated repayment dates on ~~our outstanding Tower Revenue Notes)~~certain debt).

◦~~84%~~As of March 31, 2023, after giving effect to our April 2023 Senior Notes offering and the use of proceeds therefrom, 91% of our debt ~~has~~had fixed rate coupons.

◦Our debt service coverage and leverage ratios are within their respective financial maintenance covenants.

•During ~~2022,~~2023, we completed the following financing activities (see note 4 to our condensed consolidated financial statements)

◦In March 2022, we increased the size of our CP Program to permit the issuance of Commercial Paper Notes in an aggregate principal amount not to exceed $2.0 billion at any time outstanding. Notes under the CP Program may be issued, repaid and re-issued from time to time.

◦~~In March 2022,~~January 2023, we issued ~~$750 million~~$1.0 billion aggregate principal amount of ~~2.900%~~5.000% senior unsecured notes due ~~2027~~2028 ("~~March 2022~~January 2023 Senior Notes"). We used the net proceeds from the ~~March 2022~~January 2023 Senior Notes offering to repay a portion of the outstanding indebtedness under ~~our CP Program~~the 2016 Revolver and pay related fees and expenses.

◦In ~~March 2022,~~April 2023, we ~~(1) prepaid in full~~issued the ~~previously outstanding Tower Revenue~~April 2023 Senior Notes. We used the net proceeds from the April 2023 Senior Notes ~~Series 2018-1 and (2) redeemed in full the previously outstanding 3.849% Secured Notes.~~

◦~~In July 2022, we entered into the 2022 Credit Agreement Amendment that provided for, among other things, (1) the extension~~offering to repay a portion of the ~~maturity date of the 2016 Credit Facility from June 2026 to July 2027, (2) an increase to the aggregate commitments~~outstanding indebtedness under the 2016 Revolver ~~from $5.0 billion to $7.0 billion, (3) certain modifications to a specified sustainability metric~~ and ~~(4) the replacement of the LIBOR pricing benchmark with the Term SOFR pricing benchmark.~~pay related fees and expenses.

•Significant cash flows from operations

◦Net cash provided by operating activities was ~~$2.0 billion~~$606 million for the ~~nine~~three months ended ~~September 30, 2022.~~March 31, 2023.

◦In addition to the positive impact of contractual escalators, we expect to grow our core business of providing access to our communications infrastructure as a result of future anticipated additional demand for our communications infrastructure.

•Returning cash flows provided by operations to stockholders in the form of dividends

◦During ~~each of~~ the first ~~three quarters~~quarter of ~~2022,~~2023, we paid a common stock dividend of ~~$1.47~~$1.565 per share, totaling approximately ~~$1.9 billion.~~

◦In October 2022, our board of directors declared a quarterly common stock dividend of $1.565 per share, which represents an increase of approximately 6.5% from the quarterly stock dividend declared during each of the first three quarters of 2022.$686 million.

◦We currently expect our common stock dividends over the next 12 months to be a cumulative amount of at least $6.26 per share, or an aggregate amount of approximately $2.7 billion.

◦Over time, we expect to increase our dividend per share generally commensurate with our growth in cash flows. Any future common stock dividends are subject to declaration by our board of directors. See notes 9 and 12 to our condensed consolidated financial statements for further information regarding our common stock and dividends.

2218

Outlook Highlights

The following are certain highlights of our full year ~~2022 and~~ 2023 outlook that impact our business fundamentals described above.

•We expect that, when compared to full year ~~2021,~~2022, our full year ~~2022 and~~ 2023 site rental revenues growth will be positively impacted by tenant additions as large wireless carriers and fiber solutions tenants continue to focus on meeting the increasing demand for data.

◦We expect that our Fiber segment site rental revenues will benefit from payments to satisfy remaining rental obligations for certain canceled Sprint leases, net of estimated non-renewals, as a result of the T-Mobile US, Inc. and Sprint network consolidation ("Sprint Cancellations").

•We expect to continue to invest a ~~meaningful~~significant amount of our available capital in the form of discretionary capital expenditures for ~~2022 and~~ 2023 based on the anticipated returns on such discretionary investments.

◦We expect that our discretionary capital expenditures will increase as we accelerate the pace of small cell deployments.

•We also expect sustaining capital expenditures ~~to be~~of approximately 1%2% of net revenues for full year ~~2022 and 2023.~~

2023, consistent with historical annual levels.

See also "Item 3. Quantitative and Qualitative Disclosures About Market Risk" for a discussion of our interest rate risks.

Results of Operations

The following discussion of our results of operations should be read in conjunction with our condensed consolidated financial statements and the ~~2021~~2022 Form 10-K.

The following discussion of our results of operations is based on our condensed consolidated financial statements prepared in accordance with GAAP, which requires us to make estimates and judgments that affect the reported amounts (see "Item 2. MD&A—Accounting and Reporting Matters—Critical Accounting Policies and Estimates" and note 2 to our consolidated financial statements in the ~~2021~~2022 Form 10-K). See "Item 2. MD&A—Accounting and Reporting Matters—Non-GAAP and Segment Financial Measures" for a discussion of our use of (1) segment site rental gross margin, (2) segment services and other gross margin, (3) segment operating profit (loss), including their respective definitions, and (4) Adjusted EBITDA, including its definition and a reconciliation to net income (loss) ~~from continuing operations.~~.

Our operating segments consist of (1) Towers and (2) Fiber. See note 10 to our condensed consolidated financial statements for further discussion of our operating segments.

Highlights of our results of operations for the three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ are depicted below.


(In millions of dollars)	(In millions of dollars)	Three Months Ended September 30,				(In millions of dollars)	Three Months Ended March 31,
		2022	2021	$ Change	% Change		2023	2022	$ Change	% Change
Site rental revenues:	Site rental revenues:					Site rental revenues:
Towers site rental revenues	Towers site rental revenues	$1,084	$972	+$112	+12%	Towers site rental revenues	$1,081	$1,075	+$6	+1%
Fiber site rental revenues	Fiber site rental revenues	$484	$479	+$5	+1%	Fiber site rental revenues	$543	$501	+$42	+8%
Total site rental revenues	Total site rental revenues	$1,568	$1,451	+$117	+8%	Total site rental revenues	$1,624	$1,576	+$48	+3%
Segment site rental gross margin:	Segment site rental gross margin:					Segment site rental gross margin:
Towers site rental gross margin(a)	Towers site rental gross margin(a)	$854	$745	+$109	+15%	Towers site rental gross margin(a)	$847	$850	$(3)	—%
Fiber site rental gross margin(a)	Fiber site rental gross margin(a)	$318	$316	+$2	+1%	Fiber site rental gross margin(a)	$371	$339	+$32	+9%
Segment services and other gross margin:	Segment services and other gross margin:					Segment services and other gross margin:
Towers services and other gross margin(a)	Towers services and other gross margin(a)	$61	$54	+$7	+13%	Towers services and other gross margin(a)	$47	$54	$(7)	(13)%
Fiber services and other gross margin(a)	Fiber services and other gross margin(a)	—	$1	$(1)	(100)%	Fiber services and other gross margin(a)	$1	$1	$—	—%
Segment operating profit:
Towers operating profit(a)		$887	$772	+$115	+15%
Fiber operating profit(a)		$271	$273	$(2)	(1)%
Income (loss) from continuing operations		$419	$351	+$68	+19%
Segment operating profit (loss):						Segment operating profit (loss):
Towers operating profit (loss)(a)						Towers operating profit (loss)(a)	$863	$876	$(13)	(1)%
Fiber operating profit (loss)(a)						Fiber operating profit (loss)(a)	$323	$293	+$30	+10%
Net income (loss)	Net income (loss)	$419	$351	+$68	+19%	Net income (loss)	$418	$421	$(3)	(1)%
Adjusted EBITDA(b)	Adjusted EBITDA(b)	$1,077	$976	+$101	+10%	Adjusted EBITDA(b)	$1,104	$1,095	+$9	+1%

(a)See note 10 to our condensed consolidated financial statements and "Item 2. MD&A—Accounting and Reporting Matters—Non-GAAP and Segment Financial Measures" for further discussion of our definitions of segment site rental gross margin, segment services and other gross margin and segment operating ~~profit.~~profit (loss).

(b)See reconciliation of this non-GAAP financial measure to net income (loss) ~~from continuing operations~~ and definition included in "Item 2. MD&A—Accounting and Reporting Matters—Non-GAAP and Segment Financial Measures."

2319

Site rental revenues grew ~~$117~~$48 million, or 8%3%, for the three months ended ~~September 30, 2022~~March 31, 2023 compared to the three months ended ~~September 30, 2021.~~March 31, 2022. This growth was predominately comprised of the factors depicted in the chart below:

(In millions of dollars)

(a)Represents site rental revenues growth from tenant additions across our entire portfolio and renewals or extensions of tenant contracts, exclusive of the impacts from both straight-line accounting and amortization of prepaid rent in accordance with GAAP.

(b)Core leasing activity and non-renewals include $48 million and $2 million, respectively, of payments received from and non-renewals associated with Sprint Cancellations, respectively.

(c)Prepaid rent amortization includes amortization of ~~up-front~~upfront payments received from long-term ~~tenant contracts~~tenants and other deferred credits.

~~(c)~~(d)Represents the contribution from recent acquisitions until the one-year anniversary of ~~the acquisition.~~such acquisitions.

Towers site rental revenues for the ~~third~~first quarter of ~~2022~~2023 were $1.1 billion and increased by ~~$112~~$6 million, or ~~12%~~1%, from ~~$972 million~~$1.1 billion during the same period in the prior year. ~~The increase in~~ Towers site rental revenues ~~was~~were impacted by the following items, inclusive of straight-line ~~accounting (including the impact of the T-Mobile Agreement):~~accounting: tenant additions across our entire portfolio, renewals or extensions of tenant contracts, escalations and non-renewals of ~~tenants~~tenant contracts. Tenant additions were influenced by our tenants' ongoing efforts to improve network quality and capacity.

Fiber site rental revenues for the ~~third~~first quarter of ~~2022~~2023 were ~~$484~~$543 million and increased by $5$42 million, or 1%8%, from ~~$479~~$501 million during the same period in the prior year. ~~The increase in~~ Fiber site rental revenues ~~was~~were predominately impacted by $48 million of payments related to the increased demand for small cells and fiber solutions. Increased demand for small cells was driven by our tenants' network strategy in an effort to provide capacity and relieve network congestion, and increased demand for fiber solutions was driven by increasing demand for data.Sprint Cancellations.

~~The increase in~~ Towers site rental gross margin ~~from~~was $847 million in the ~~third~~first quarter of ~~2021~~2023 compared to $850 million in the ~~third~~first quarter of ~~2022~~2022. The decrease was related to the previously-mentioned ~~12%~~1% increase in Towers site rental revenues ~~and relatively fixed~~being fully offset by the increase in site rental costs of operations. Fiber site rental gross margin was $371 million in the first quarter of 2023 compared to ~~operate our towers.~~$339 million in the first quarter of 2022. The increase in Fiber site rental gross margin was predominately related to the previously-mentioned 1%8% increase in Fiber site rental revenues.

Towers services and other gross margin was ~~$61~~$47 million for the ~~third~~first quarter of ~~2022~~2023 and ~~increased~~decreased by $7 million from $54 million during the same period in the prior year, which is a reflection of the lower volume of activity from carriers' network enhancements and the volume and mix of services and other work. Our services and other offerings are of a variable nature as these revenues are not under long-term tenant contracts.

Selling, general and administrative expenses for the ~~third~~first quarter of ~~2022~~2023 were ~~$187~~$195 million and increased by ~~$20~~$14 million, or ~~12%~~8%, from ~~$167~~$181 million during the same period in the prior year. ~~The~~This increase ~~in selling, general and administrative expenses~~ was primarily related to certain expenses, including travel and facilities, returning to their pre-pandemic levels following our return to the ~~growth~~office in ~~our business.~~February 2022.

2420

Towers operating profit (loss) for the ~~third~~first quarter of ~~2022~~2023 decreased by $13 million, or 1%, from the same period in the prior year. The decrease in Towers operating profit (loss) was primarily related to the previously-mentioned decreases in both Towers site rental gross margin and Towers services and other gross margin.

Fiber operating profit (loss) for the first quarter of 2023 increased by ~~$115~~$30 million, or ~~15%~~10%, from the same period in the prior year. The increase in ~~Towers~~Fiber operating profit (loss) was primarily related to the ~~growth in our Towers site rental revenues and relatively fixed costs to operate our towers as well as the~~ previously-mentioned increase in ~~Towers services and other~~Fiber site rental gross margin.

Depreciation, amortization and accretion was approximately ~~$430~~$431 million for ~~third~~first quarter of ~~2022~~2023 and increased by ~~$17~~$11 million, or 4%3% during the same period in the prior year. This increase predominately resulted from a corresponding increase in our gross property and equipment due to capital expenditures.

Interest expense and amortization of deferred financing costs, net were ~~$177~~$202 million for the ~~third~~first quarter of ~~2022~~2023 and increased by ~~$14~~$38 million, or 9%23%, from ~~$163~~$164 million during the same period in the prior year. The increase predominately resulted from an increase in the variable interest rate on our 2016 Term Loan A, 2016 Revolver and outstanding Commercial Paper Notes, as well as an increase in our outstanding indebtedness due to the financing of our discretionary capital expenditures. See note 4 to our condensed consolidated financial statements for a further discussion of our debt and "Item 3. Quantitative and Qualitative Disclosures About Market Risk" for a further discussion of our interest rate exposure.

For the ~~third~~first quarter of ~~2022~~2023 and ~~2021,~~2022, the effective tax rate differs from the federal statutory rate predominately due to our REIT status, including the dividends paid deduction. See note 6 to our condensed consolidated financial statements and also note 9 to our consolidated financial statements in the ~~2021~~2022 Form 10-K.

~~Income from continuing operations~~Net income (loss) was ~~$419~~$418 million during the ~~third~~first quarter of ~~2022~~2023 compared to ~~$351~~$421 million during the ~~third~~first quarter of ~~2021.~~2022. The ~~increase~~decrease was predominately related to ~~growth in our site rental activities in both our Towers and Fiber segments, partially offset by~~ an increase in expenses, including (1) selling, general and administrative expenses, and (2) depreciation, amortization and accretion and (3) interest expense and amortization of deferred financing ~~costs.~~

Net income was $419 million during the third quarter of 2022 compared to $351 million during the third quarter of 2021. The increase was due to the previously-mentioned increase in income from continuing operations.

~~Adjusted EBITDA increased $101 million, or 10%, from the third quarter of 2021 to the third quarter of 2022, reflecting the growth in our site rental activities in both our Towers and Fiber segments.~~

~~Highlights of our results of operations for the nine months ended September 30, 2022 and 2021 are depicted below.~~

(In millions of dollars) Nine Months Ended September 30,
2022 2021 $ Change % Change
Site rental revenues:
Towers site rental revenues $3,237 $2,819 +$418 +15%
Fiber site rental revenues $1,474 $1,426 +$48 +3%
Total site rental revenues $4,711 $4,245 +$466 +11%
Segment site rental gross margin:
Towers site rental gross margin(a)
$2,548 $2,160 +$388 +18%
Fiber site rental gross margin(a)
$984 $941 +$43 +5%
Segment services and other gross margin:
Towers services and other gross margin(a)
$173 $142 +$31 +22%
Fiber services and other gross margin(a)
$2 $4 $(2) (50)%
Segment operating profit:
Towers operating profit(a)
$2,637 $2,224 +$413 +19
Fiber operating profit(a)
$846 $812 +$34 +4%
Income from continuing operations $1,261 $805 +$456 +57%
Net income (loss) $1,261 $743 +$518 +70%
Adjusted EBITDA(b)
$3,249 $2,831 +$418 +15%

~~(a)~~See note 10 to our condensed consolidated financial statements for further discussion of our definitions of segment site rental gross margin, segment services and other gross margin and segment operating profit.

~~(b)See reconciliation of this non-GAAP financial measure to income (loss) from continuing operations and definition included in~~ ~~"Item 2. MD&A—Accounting and Reporting Matters—Non-GAAP and Segment Financial Measures."~~

Site rental revenues grew $466 million, or 11%, for the nine months ended September 30, 2022 compared to the nine months ended September 30, 2021. This growth was predominately comprised of the factors depicted in the chart below:

~~(In millions of dollars)~~

~~(a)~~Represents site rental revenues growth from tenant additions across our entire portfolio and renewals or extensions of tenant contracts, exclusive of the impacts from both straight-line accounting and amortization of prepaid rent in accordance with GAAP.

~~(b)Prepaid rent amortization includes amortization of up-front payments received from long-term tenant contracts and other deferred credits.~~

~~(c)Represents the contribution from recent acquisitions until the one-year anniversary of the acquisition.~~

Towers site rental revenues for the first nine months of 2022 were $3.2 billion and increased by $418 million, or 15%, from the same period in the prior year. The increase in Towers site rental revenues was impactedcosts, net, partially offset by the following items, inclusive of straight-line accounting (including the impact of the T-Mobile Agreement): tenant additions across our entire portfolio, renewals or extensions of tenant contracts, escalations and non-renewals of tenant contracts. Tenant additions were influenced by our tenants' ongoing efforts to improve network quality and capacity.

Fiber site rental revenues for the first nine months of 2022 were $1.5 billion and increased by $48 million, or 3%, from $1.4 billion during the same period in the prior year. The increase in Fiber site rental revenues was predominately impacted by the increased demand for small cells and fiber solutions. Increased demand for small cells was driven by our tenants' network strategy in an effort to provide capacity and relieve network congestion, and increased demand for fiber solutions was driven by increasing demand for data.

~~The increase in Towers site rental gross margin was related to the~~ previously-mentioned 15% increase in Towers site rental revenues and relatively fixed costs to operate our towers. The increase in Fiber site rental gross margin was predominately related to the previously-mentioned 3% increase in Fiber site rental revenues.

Towers services and other gross margin was $173 million for the first nine months of 2022 and increased by $31 million from $142 million during the same period in the prior year, which is a reflection of the volume of activity from carriers' network enhancements and the volume and mix of services and other work. Our services and other offerings are of a variable nature as these revenues are not under long-term contracts.

Selling, general and administrative expenses for the first nine months of 2022 were $558 million and increased by $58 million, or 12%, from $500 million during the same period in the prior year. The increase in selling, general and administrative expenses was primarily due to the growth in our business.

Towers operating profit for the first nine months of 2022 increased by $413 million, or 19%, from the prior year as a result of the previously-mentioned increase in Towers site rental gross margin as well as the previously-mentioned increase in Towers services and other gross margin.

~~Fiber operating profit for the first nine months of 2022 increased by $34 million, or 4%, from the same period in the prior year. The~~ increase in Fiber operating profit ~~was primarily related to the the previously-mentioned growth in our Fiber site rental gross margin.~~(loss).

~~Depreciation, amortization and accretion was $1.3 billion for the first nine months of 2022 and~~Adjusted EBITDA increased ~~by $47~~$9 million, or 4%1%, from the ~~same period in the prior year. This increase predominately resulted from a corresponding increase in our gross property and equipment due~~first quarter of 2022 to ~~capital expenditures.~~

~~Interest expense and amortization of deferred financing costs were $506 million for~~ the first ~~nine months~~quarter of 2022 and increased $13 million from $493 million during the same period in the prior year. The increase predominately resulted from an increase in the variable interest rate on our 2016 Term Loan A, 2016 Revolver and outstanding Commercial Paper Notes, as well as an increase in our outstanding indebtedness due to the financing of our discretionary capital expenditures, partially offset by a reduction in the weighted-average interest rate on our fixed rate debt as a result of our refinancing activities. See note 4 to our condensed consolidated financial statements for a further discussion of our debt and ~~"Item 3. Quantitative and Qualitative Disclosures About Market Risk"~~ ~~for a further discussion of our interest rate exposure.~~

As a result of repaying certain of our indebtedness in conjunction with our refinancing activities, we incurred losses on retirement of long-term obligations of $28 million and $145 million during the first nine months of 2022 and 2021, respectively. See note 4 to our condensed consolidated financial statements.

For the first nine months of 2022 and 2021, the effective tax rate differs from the federal statutory rate predominately due to our REIT status, including the dividends paid deduction. See note 6 to our condensed consolidated financial statements and also note 9 to our consolidated financial statements in the 2021 Form 10-K.

Income from continuing operations was $1.3 billion for the first nine months of 2022 compared to $805 million during the first nine months of 2021. The increase was related to (1) growth in our site rental activities in both our Towers and Fiber segments, (2)2023, reflecting the previously-mentioned increase in Towers services activity and (3) the decrease in losses on retirement of long-term obligations, partially offset by by an increase in expenses, including (1) selling, general and administrative expenses, (2) depreciation, amortization and accretion and (3) interest expense and amortization of deferred financing costs.Fiber operating profit (loss).

~~Loss from discontinued operations, net of tax, was $62 million for the first nine months of 2021 due to the ATO Settlement. See note 9 to our consolidated financial statements in the 2021 Form 10-K.~~

Net income was $1,261 million for the first nine months of 2022 compared to $743 million during the first nine months of 2021. The increase was due to (1) the previously-mentioned increase in income from continuing operations and (2) the previously-mentioned loss from discontinued operations, net of tax recorded during the first nine months of 2021.

Adjusted EBITDA increased $418 million, or 15%, from the first nine months of 2021 to the first nine months of 2022, reflecting the growth in our site rental activities in both our Towers and Fiber segments as well as the previously-mentioned increase in Towers service activity.

Liquidity and Capital Resources

Overview

General. Our core business generates revenues under long-term tenant contracts (see "Item 2. MD&A—General Overview—Overview") from (1) the largest U.S. wireless carriers and (2) fiber solutions tenants. As a leading provider of shared communications infrastructure in the U.S., our strategy is to create long-term stockholder value via a combination of (1) growing cash flows generated from our portfolio of communications infrastructure, (2) returning a meaningful portion of our cash generated by operating activities to our stockholders in the form of dividends, and (3) investing capital efficiently to grow cash flows and long-term dividends per share. Our strategy is based, in part, on our belief that the U.S. is the most attractive market for shared communications infrastructure investment with the greatest long-term growth potential. We measure our efforts to create "long-term stockholder value" by the combined payment of dividends to stockholders and growth in our per share results.

We have engaged, and expect to continue to engage, in discretionary investments that we believe will maximize long-term stockholder value. Our historical discretionary investments include (in no particular order): constructing communications infrastructure, acquiring communications infrastructure, acquiring land interests (which primarily relate to land assets under towers), improving and structurally enhancing our existing communications infrastructure, purchasing shares of our common stock, and purchasing, repaying, or redeeming our debt. We have recently spent, and expect to continue to spend, a significant percentage of our discretionary investments on the construction of small cells and fiber. We seek to fund our discretionary investments with both ~~net~~ cash generated by operating activities and cash available from financing capacity, such as the use of our availability ~~from the~~under our 2016 Revolver, issuances under our CP Program, debt financings and issuances of equity or equity-related securities, including under our 2021 ATM Program.

We seek to maintain a capital structure that we believe drives long-term stockholder value and optimizes our weighted-average cost of capital. We target a leverage ratio of approximately five times Adjusted EBITDA, subject to various factors, such as the availability and cost of capital and the potential long-term return on our discretionary investments. We may choose to increase or decrease our leverage from this target for various periods of time. ~~We have no significant~~Our contractual debt maturities ~~until July 2023 (other than~~over the next 12 months consist of (1) Commercial Paper Notes, ~~that~~of which we had $577 million outstanding as of May 1, 2023, (2) $750 million aggregate principal amount of 3.150% senior unsecured notes ("3.150% Senior Notes") and (3) principal payments on certain outstanding debt. Amounts available under our CP Program may be ~~outstanding~~repaid and re-issued from time to time and ~~principal payments on certain outstanding debt).~~we intend to maintain available commitments under our 2016 Revolver in an amount at least equal to the amount of Commercial Paper Notes outstanding.

We operate as a REIT for U.S. federal income tax purposes. We expect to continue to pay minimal cash income taxes as a result of our REIT status and our NOLs. See note 6 to our condensed consolidated financial statements and also the ~~2021~~2022 Form 10-K.

Liquidity Position. The following is a summary of our capitalization and liquidity position as of ~~September 30, 2022.~~March 31, 2023, after giving effect to our April 2023 Senior Notes offering and the use of the net proceeds therefrom. See "Item 3. Quantitative and Qualitative Disclosures About Market Risk" and note 4 to our condensed consolidated financial statements for additional information regarding our debt as well as note 9 to our condensed consolidated financial statements for additional information regarding our 2021 ATM Program.


(In millions of dollars)
Cash, cash equivalents, and restricted cash(a)	$	~~347~~388
Undrawn 2016 Revolver availability(b)	~~6,254~~6,862
Debt and other long-term obligations (current and non-current)~~(c)~~	~~21,483~~22,332
Total equity	~~7,679~~7,223

(a)Inclusive of $5 million included within "Other assets, net" on our condensed consolidated balance sheet.

(b)Availability at any point in time is subject to certain restrictions based on the maintenance of financial covenants contained in ~~the~~our 2016 Credit Facility. See the ~~2021~~2022 Form 10-K. At any point in time, we intend to maintain available commitments under our 2016 Revolver in an amount at least equal to the amount of outstanding Commercial Paper Notes.

~~(c)~~See~~"Item 2. MD&A—General Overview—Highlights of Business Fundamentals and Results"~~ ~~and~~ note 4 to our condensed consolidated financial ~~statements for further information regarding the CP Program.~~statements.

Over the next 12 months:

•Our liquidity sources may include (1) cash on hand, (2) ~~net~~ cash generated by our operating activities, (3) availability under our 2016 Revolver, (4) issuances under our CP Program, and (5) issuances of equity pursuant to our 2021 ATM Program. Our liquidity uses over the next 12 months are expected to include (1) debt obligations of ~~$2.4~~$1.5 billion (consisting of Commercial Paper Notes, ~~redemption of~~ the 3.150% Senior Notes and principal ~~payments)~~payments on certain outstanding debt), (2) cumulative common stock dividend payments expected to be at least $6.26 per share, or an aggregate amount of approximately $2.7 billion (see "Item 2. MD&A—Highlights of Business Fundamentals and Results") and (3) capital expenditures. We may also purchase shares of our common stock. Additionally, amounts available under ~~the~~our CP Program may be repaid and re-issued from time to ~~time.~~time and we intend to maintain available commitments under our 2016 Revolver in an amount at least equal to the amount of Commercial Paper Notes outstanding. During the next 12 months, while our liquidity uses are expected to exceed our ~~net~~ cash ~~provided~~generated by operating activities, we expect that our liquidity sources described above should be sufficient to cover our expected uses. Historically, from time to time, we have accessed the capital markets to issue debt and equity.

•See "Item 3. Quantitative and Qualitative Disclosures About Market Risk" for a discussion of interest rate risk and note 4 to our condensed consolidated financial statements for a tabular presentation of our debt maturities and a discussion of anticipated repayment dates.

Summary Cash Flow Information


		Nine Months Ended September 30,							Three Months Ended March 31,
(In millions of dollars)	(In millions of dollars)	2022		2021		Change		(In millions of dollars)	2023		2022		Change
Net increase (decrease) in cash, cash equivalents, and restricted cash:	Net increase (decrease) in cash, cash equivalents, and restricted cash:							Net increase (decrease) in cash, cash equivalents, and restricted cash:
Operating activities	Operating activities	$	2,038	$	2,055	$	(17)	Operating activities	$	606	$	558	$	48
Investing activities	Investing activities	(946)		(911)		(35)		Investing activities	(407)		(289)		(118)
Financing activities	Financing activities	(1,209)		(921)		(288)		Financing activities	(139)		(253)		114
Net increase (decrease) in cash, cash equivalents, and restricted cash - continuing operations		(117)		223		(340)
Effect of exchange rate changes on cash		(2)		—		(2)
Net increase (decrease) in cash, cash equivalents, and restricted cash - continuing operations		(119)		223		(342)
Net increase (decrease) in cash, cash equivalents, and restricted cash - discontinued operations		—		(62)		62
Net increase (decrease) in cash, cash equivalents, and restricted cash	Net increase (decrease) in cash, cash equivalents, and restricted cash	$	(119)	$	161	$	(280)	Net increase (decrease) in cash, cash equivalents, and restricted cash	$	60	$	16	$	44

Operating Activities

Net cash provided by operating activities of ~~$2.0 billion~~$606 million for the first ~~nine~~three months of ~~2022 decreased~~2023 increased by ~~$17~~$48 million, or 1%9%, compared to the first ~~nine~~three months of ~~2021,~~2022, due primarily to a net ~~decrease~~increase from changes in working capital ~~which was partially offset by~~and growth in our core business. Changes in working capital contribute to variability in net cash provided by operating activities, largely due to the timing of advanced payments by us and advanced receipts from tenants. We expect to grow our net cash provided by operating activities in the future (exclusive of changes in working capital) if we realize expected growth in our core business.

Investing Activities

Net cash used for investing activities of ~~$946~~$407 million for the first ~~nine~~three months of ~~2022~~2023 increased by ~~$35~~$118 million, or 4%41%, from the first ~~nine~~three months of ~~2021~~2022 primarily as a result of payments for acquisitions in our Towers segment and increased discretionary capital expenditures in our Fiber segment.

~~Capital Expenditures~~

Our capital expenditures are categorized as discretionary or sustaining as described below.

•Discretionary capital expenditures are made with respect to activities which we believe exhibit sufficient potential to enhance long-term stockholder value. They primarily consist of expansion or development of communications infrastructure (including capital expenditures related to (1) enhancing communications infrastructure in order to add new tenants for the first time or support subsequent tenant equipment augmentations or (2) modifying the structure of a communications infrastructure asset to accommodate additional tenants) and construction of new communications infrastructure. Discretionary capital expenditures also include purchases of land interests (which primarily relate to land assets under towers as we seek to manage our interests in the land beneath our towers), certain technology-related investments necessary to support and scale future customer demand for our communications infrastructure, and other capital projects. The expansion or development of existing communications infrastructure to accommodate new leasing typically varies based on, among other factors: (1) the type of communications infrastructure, (2) the scope, volume, and mix of work performed on the communications infrastructure, (3) existing capacity prior to installation, or (4) changes in structural engineering regulations and standards. Currently, construction of new communications infrastructure is predominately comprised of the construction of small cells and fiber (including certain construction projects that may take 18 to 36 months to complete). Our decisions regarding discretionary capital expenditures are influenced by the availability and cost of capital and expected returns on alternative uses of cash, such as payments of dividends and investments.

•Sustaining capital expenditures consist of those capital expenditures not otherwise categorized as discretionary capital expenditures, such as (1) maintenance capital expenditures on our communications infrastructure assets that enable our tenants' ongoing quiet enjoyment of the communications infrastructure and (2) ordinary corporate capital expenditures.

~~Capital~~A summary of our capital expenditures for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021 were~~is as follows:


		For the Nine Months Ended																	For the Three Months Ended
		September 30, 2022								September 30, 2021									March 31, 2023								March 31, 2022
(In millions of dollars)	(In millions of dollars)	Towers		Fiber		Other		Total		Towers		Fiber		Other		Total		(In millions of dollars)	Towers		Fiber		Other		Total		Towers		Fiber		Other		Total
Discretionary:	Discretionary:																	Discretionary:
Communications infrastructure improvements and other capital projects(a)																		Communications infrastructure improvements and other capital projects(a)	$	33	$	272	$	6	$	311	$	35	$	209	$	6	$	250
Purchases of land interests	Purchases of land interests	$	37	$	—	$	—	$	37	$	46	$	—	$	—	$	46	Purchases of land interests	15		—		—		15		10		—		—		10
Communications infrastructure improvements and other capital projects(a)		92		711		16		819		104		666		20		790
Sustaining	Sustaining	8		35		22		65		10		35		11		56		Sustaining	2		7		6		15		2		13		6		21
Total	Total	$	137	$	746	$	38	$	921	$	160	$	701	$	31	$	892	Total	$	50	$	279	$	12	$	341	$	47	$	222	$	12	$	281

(a)Towers segment includes ~~$34~~$10 million and ~~$47~~$16 million of capital expenditures incurred during the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ respectively, in connection with tenant installations and upgrades on our towers.

Discretionary capital expenditures were primarily impacted by the timing of both Towers and Fiber tenant activity during the first ~~nine~~three months of ~~2022~~2023 compared to the same period in ~~2021.~~2022. See also "Item 2. MD&A—General Overview—Outlook Highlights" for our expectations surrounding ~~2022 and~~ 2023 capital expenditures.

Financing ~~Activities.~~Activities

We seek to allocate cash generated by our operations in a manner that will enhance long-term stockholder value, which may include various financing activities such as (in no particular order): (1) paying dividends on our common stock (currently expected to total at least $6.26 per share over the next 12 months, or an aggregate amount of approximately $2.7 billion);, (2) purchasing our common stock or (3) purchasing, repaying, or redeeming our debt. See notes 4, 9 and 12 to our condensed consolidated financial statements.

Net cash used for financing activities of ~~$1.2 billion~~$139 million for the first ~~nine~~three months of ~~2022 increased~~2023 decreased by ~~$288~~$114 million from the first ~~nine~~three months of ~~2021~~2022 as a result of the net impact from our issuances, purchases and repayments of debt (including with respect to our 2016 Credit Facility and CP Program), common stock dividend payments and purchases of our common stock. See "Item 2. MD&A—General Overview—Highlights of Business Fundamentals and ~~Results~~Results" and notes 4 and 9 to our condensed consolidated financial statements for further information.

~~In March 2022, we issued $750 million aggregate principal amount of senior unsecured notes, the~~The net proceeds of ~~which~~the January 2023 Senior Notes were used to repay a portion of the outstanding indebtedness under ~~our CP Program~~the 2016 Revolver and pay related fees and expenses.

~~In March 2022, we (1) prepaid in full the previously outstanding Tower Revenue Notes, Series 2018-1 and (2) redeemed in full the previously outstanding 3.849% Secured Notes.~~

Credit Facility. In July 2022, we entered into the 2022 Credit Agreement Amendment that provided for, among other things, (1) the extension of the maturity date of the 2016 Credit Facility from June 2026 to July 2027, (2) an increase to the aggregate commitments under the 2016 Revolver from $5.0 billion to $7.0 billion, (3) certain modifications to a specified sustainability metric and (4) the replacement of the LIBOR pricing benchmark with the Term SOFR pricing benchmark.

The proceeds offrom our 2016 Revolver may be used for general corporate purposes, which may include the financing of capital expenditures, acquisitions, ~~purchases,~~the repayment or ~~redemption~~repurchase of ~~our debt~~any outstanding indebtedness and purchases of our common stock. As of ~~November 2, 2022, we had an~~May 1, 2023, there was no outstanding balance ~~of $985 million~~ and ~~$6.0~~$7.0 billion in undrawn availability under our 2016 Revolver. At any point in time, we intend to maintain available commitments under our 2016 Revolver in an amount at least equal to the amount of outstanding Commercial Paper Notes. See note 4 to our condensed consolidated financial statements for additional information regarding our Credit Facility.

Commercial Paper Program. ~~See~~ ~~"Item 2. MD&A—General Overview—Highlights of Business Fundamentals and Results"~~ and note 4 to our condensed consolidated financial statements for further information regarding our CP Program. In March 2022, we increased the size of our CP Program to permit the issuance of Commercial Paper Notes in an aggregate principal amount not to exceed $2.0 billion at any time outstanding. The proceeds from our Commercial Paper Notes may be used for general corporate purposes, which may include the financing of capital expenditures, acquisitions, ~~purchases,~~the repayment or ~~redemption~~repurchase of ~~our debt~~any outstanding indebtedness and purchases of our common stock. As of ~~November 2, 2022,~~May 1, 2023, there was ~~$1.2 billion~~$577 million outstanding under our CP Program. See note 4 to our condensed consolidated financial statements for further information regarding our CP Program.

Incurrence, Purchases, and Repayments of Debt. See "Item 2. MD&A—General Overview—Highlights of Business Fundamentals and Results" and note 4 to our condensed consolidated financial statements for further discussion of our recent issuances, purchases, ~~redemption~~redemptions and repayments of debt.

Common Stock Activity. See notes 9 and 12 to our condensed consolidated financial statements for further information regarding our common stock and dividends.

ATM Program. In March 2021, we established the 2021 ATM Program through which we may issue and sell shares of our common stock having an aggregate gross sales price of up to $750 million. Sales under the 2021 ATM Program may be made by means of ordinary brokers' transactions on the NYSE or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or, subject to our specific instructions, at negotiated prices. We intend to use the net proceeds from any sales under the 2021 ATM Program for general corporate purposes, which may include (1) the funding of future acquisitions or investments or (2) the repayment or repurchase of any outstanding indebtedness. We have not sold any shares of common stock under the 2021 ATM Program.

Debt Covenants. Our 2016 Credit Agreement contains financial maintenance covenants. We are currently in compliance with these financial maintenance covenants and, based upon our current expectations, we believe we will continue to comply with our financial maintenance covenants. In addition, certain of our debt agreements contain restrictive covenants that place restrictions on us and may limit our ability to, among other things, incur additional debt and liens, purchase our securities, make capital expenditures, dispose of assets, undertake transactions with affiliates, make other investments, pay dividends or distribute excess cash flow. See the ~~2021~~2022 Form 10-K for a further discussion of our debt covenants, certain restrictive covenants and factors that are likely to determine our subsidiaries' ability to comply with current and future debt covenants.

Accounting and Reporting Matters

Critical Accounting Policies and Estimates

Our critical accounting policies and estimates are those that we believe (1) are most important to the portrayal of our financial condition and results of operations or (2) require our most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. In many cases, the accounting treatment of a particular transaction is specifically prescribed by GAAP. In other cases, management is required to exercise judgment in the application of accounting principles with respect to particular transactions. Accordingly, actual results could differ materially from our estimates. Our critical accounting policies and estimates as of December 31, ~~2021~~2022 are described in "Item 7. MD&A—Accounting and Reporting Matters" and in note 2 of our consolidated financial statements in the ~~2021~~2022 Form 10-K.

Accounting Pronouncements

Recently Adopted Accounting ~~Pronouncements~~

Pronouncements. See note 2 to our condensed consolidated financial statements.

Recent Accounting Pronouncements Not Yet ~~Adopted~~Adopted.

See note 2 to our condensed consolidated financial statements.

Non-GAAP and Segment Financial Measures

We use earnings before interest, taxes, depreciation, amortization and accretion, as adjusted ("Adjusted EBITDA"), which is a non-GAAP financial measure, as an indicator of consolidated financial performance. Our measure of Adjusted EBITDA may not be comparable to similarly titled measures of other companies, including companies in the communications infrastructure sector or other REITs, and is not a measure of performance calculated in accordance with GAAP. Adjusted EBITDA should not be considered in isolation or as a substitute for operating income (loss), ~~income (loss) from continuing operations,~~ net income (loss), net cash provided by (used for) operating, investing and financing activities or other income statement or cash flow statement data prepared in accordance with GAAP and should be considered only as a supplement to net income (loss) ~~from continuing operations~~ computed in accordance with GAAP as a measure of our performance. There are material limitations to using a measure such as Adjusted EBITDA, including the difficulty associated with comparing results among more than one company, including our competitors, and the inability to analyze certain significant items, including depreciation and interest expense, that directly affect our net income ~~or loss.~~(loss). Management compensates for these limitations by considering the economic effect of the excluded expense items independently as well as in connection with their analysis of net income (loss) ~~from continuing operations.~~.

We define Adjusted EBITDA as net income (loss) ~~from continuing operations~~ plus restructuring charges (credits), asset write-down charges, acquisition and integration costs, depreciation, amortization and accretion, amortization of prepaid lease purchase price adjustments, interest expense and amortization of deferred financing costs, net, (gains) losses on retirement of long-term obligations, net (gain) loss on interest rate swaps, (gains) losses on foreign currency swaps, impairment of available-for-sale securities, interest income, other (income) expense, (benefit) provision for income taxes, cumulative effect of a change in accounting principle, ~~and~~ stock-based compensation ~~expense.~~expense, net and net (gain) loss from disposal of discontinued operations, net of tax. The reconciliation of Adjusted EBITDA to our net income (loss) ~~from continuing operations~~ is set forth below:


(In millions of dollars)	(In millions of dollars)	Three Months Ended September 30,				Nine Months Ended September 30,				(In millions of dollars)	Three Months Ended March 31,
		2022		2021		2022		2021			2023		2022
Income (loss) from continuing operations		$	419	$	351	$	1,261	$	805
Adjustments to increase (decrease) income (loss) from continuing operations:
Net income (loss)										Net income (loss)	$	418	$	421
Adjustments to increase (decrease) net income (loss):										Adjustments to increase (decrease) net income (loss):
Asset write-down charges	Asset write-down charges	3		—		26		9		Asset write-down charges	—		14
Acquisition and integration costs		—		—		1		1

Depreciation, amortization and accretion	Depreciation, amortization and accretion	430		413		1,276		1,229		Depreciation, amortization and accretion	431		420
Amortization of prepaid lease purchase price adjustments	Amortization of prepaid lease purchase price adjustments	4		4		12		14		Amortization of prepaid lease purchase price adjustments	4		4
Interest expense and amortization of deferred financing costs		177		163		506		493
Interest expense and amortization of deferred financing costs, net										Interest expense and amortization of deferred financing costs, net	202		164
(Gains) losses on retirement of long-term obligations	(Gains) losses on retirement of long-term obligations	2		1		28		145		(Gains) losses on retirement of long-term obligations	—		26
Interest income	Interest income	(1)		—		(1)		(1)		Interest income	(2)		—
Other (income) expense	Other (income) expense	2		4		5		16		Other (income) expense	3		1
(Benefit) provision for income taxes	(Benefit) provision for income taxes	3		7		14		20		(Benefit) provision for income taxes	7		6
Stock-based compensation expense		38		33		121		100
Stock-based compensation expense, net										Stock-based compensation expense, net	41		39
Adjusted EBITDA(a)	Adjusted EBITDA(a)	$	1,077	$	976	$	3,249	$	2,831	Adjusted EBITDA(a)	$	1,104	$	1,095

(a)The above reconciliation excludes the items included in our Adjusted EBITDA definition which are not applicable to the periods shown.

We believe Adjusted EBITDA is useful to investors or other interested parties in evaluating our financial performance because:

•it is the primary measure used by our management (1) to evaluate the economic productivity of our operations and (2) for purposes of making decisions about allocating resources to, and assessing the performance of, our operations;

•although specific definitions may vary, it is widely used by investors or other interested parties in evaluation of the communications infrastructure sector and other REITs to measure financial performance without regard to items such as depreciation, amortization and accretion, which can vary depending upon accounting methods and the book value of assets;

•we believe it helps investors and other interested parties meaningfully evaluate and compare the results of our operations (1) from period to period and (2) to our competitors by removing the impact of our capital structure (primarily interest charges from our outstanding debt) and asset base (primarily depreciation, amortization and accretion) from our financial results; and

•it is similar to the measure of current financial performance generally used in our debt covenant calculations.

Our management uses Adjusted EBITDA:

•as a performance goal in employee annual incentive compensation;

•as a measurement of financial performance because it assists us in comparing our financial performance on a consistent basis as it removes the impact of our capital structure (primarily interest charges from our outstanding debt) and asset base (primarily depreciation, amortization and accretion) from our operating results;

•in presentations to our board of directors to enable it to have the same measurement of financial performance used by management;

•for planning purposes, including preparation of our annual operating budget;

•as a valuation measure in strategic analyses in connection with the purchase and sale of assets;

•in determining self-imposed limits on our debt levels, including the evaluation of our leverage ~~ratio and interest coverage~~ ratio; and

•with respect to compliance with our debt covenants, which require us to maintain certain financial ratios that incorporate concepts such as, or similar to, Adjusted EBITDA.

In addition to the non-GAAP measures used herein and as discussed in note 10 to our condensed consolidated financial statements, we also provide (1) segment site rental gross margin, (2) segment services and other gross margin, and (3) segment operating profit (loss), which are key measures used by management to evaluate the performance of our operating segments. These segment measures are provided pursuant to GAAP requirements related to segment reporting.

We define segment site rental gross margin as segment site rental revenues less segment site rental costs of operations, excluding stock-based compensation expense, net and amortization of prepaid lease purchase price adjustments recorded in consolidated site rental costs of operations. We define segment services and other gross margin as segment services and other revenues less segment services and other costs of operations, excluding stock-based compensation expense, net recorded in consolidated services and other costs of operations. We define segment operating profit (loss) as segment site rental gross margin plus segment services and other gross margin, and segment other operating (income) expense, less segment selling, general and administrative ~~expenses attributable to the respective segment.~~expenses. All of these measurements of profit or loss are exclusive of depreciation, amortization and accretion, which are shown separately. Additionally, certain costs are shared across segments and are reflected in our segment measures through allocations that management believes to be reasonable.

3326

ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The following section updates "Item 7A. Quantitative and Qualitative Disclosures About Market Risk" in the ~~2021~~2022 Form 10-K and should be read in conjunction with that report as well as our condensed consolidated financial ~~statements included in Part 1, Item 1 of this Form 10-Q.~~statements.

Interest Rate Risk

Our interest rate risk as of ~~September 30, 2022~~March 31, 2023 relates primarily to the impact of interest rate movements on the ~~following:~~following, after giving effect to our April 2023 Senior Notes offering and the use of the net proceeds therefrom:

•the potential refinancing of our $22.3 billion of existing debt ~~($21.6 billion~~ outstanding ~~at September 30, 2022 and $20.8 billion at December~~as of March 31, ~~2021);~~2023;

•our ~~$3.5 billion and $2.2~~2.0 billion of floating rate debt ~~at September 30, 2022 and December~~as of March 31, ~~2021, respectively,~~2023, which represented approximately ~~16% and 10%~~9% of our total debt as of ~~September 30, 2022 and December~~March 31, ~~2021, respectively;~~2023; and

•potential future borrowings of incremental debt, including borrowings under our 2016 Credit Facility and issuances under ~~the~~our CP Program.

~~During~~Over the ~~first eleven~~past 14 months, ~~of 2022,~~ the Federal Reserve has raised the federal funds rate ~~six~~nine times for a cumulative increase of ~~3.75%, and has signaled that they expect to further increase~~4.75%. Further increases in the federal funds rate ~~in the near-term, which~~ could ~~further~~ increase our costs of borrowing. ~~Prior to~~See also "Item 1A. Risk Factors" in the 2022 ~~the Federal Reserve had not raised the federal funds~~Form 10-K for a discussion of risks stemming from interest rate ~~since December 2018.~~increases.

We currently have no interest rate swaps.

Sensitivity ~~Analysis~~

Analysis. We manage our exposure to market interest rates on our existing debt by controlling the mix of fixed and floating rate debt. As of ~~September 30, 2022,~~March 31, 2023, after giving effect to our April 2023 Senior Notes offering and the use of the net proceeds therefrom, we had ~~$3.5~~2.0 billion of floating rate debt. As a result, a hypothetical unfavorable fluctuation in market interest rates on our existing debt of 1/84 of a percent point over a ~~12 month~~12-month period would increase our interest expense by approximately $4$5 million.

~~Tabular Information~~

Future Principal Payments and Interest Rates. The following table provides information about our market risk related to changes in interest rates. The future principal payments and weighted-average interest rates are presented as of ~~September 30, 2022.~~March 31, 2023, after giving effect to our April 2023 Senior Notes offering and the use of the net proceeds therefrom. These debt maturities reflect final maturity dates and do not consider the impact of the principal payments that commence following the anticipated repayment dates of certain debt (see footnotes (b) and (d)). The information presented below regarding the variable rate debt is supplementary to our sensitivity analysis regarding the impact of changes in the interest rates. See notes 4 and 5 to our condensed consolidated financial statements and the ~~2021~~2022 Form 10-K for additional information regarding our debt.


		Future Principal Payments and Interest Rates by the Debt Instruments' Contractual Year of Maturity																									Future Principal Payments and Interest Rates by the Debt Instruments' Contractual Year of Maturity
(In millions of dollars)	(In millions of dollars)	2022				2023			2024			2025			2026			Thereafter			Total			Fair Value(a)		(In millions of dollars)	2023				2024			2025			2026			2027			Thereafter			Total			Fair Value(a)
Debt:	Debt:																									Debt:
Fixed rate(b)	Fixed rate(b)	$	12			$	789		$	785		$	531		$	2,679		$	13,341		$	18,137		$	15,422	Fixed rate(b)	$	780			$	787		$	534		$	2,682		$	2,278		$	13,441		$	20,502		$	18,415
Average interest rate(b)(c)(d)	Average interest rate(b)(c)(d)	4.6		%		3.2		%	3.3		%	1.5		%	3.0		%	3.9		%	3.6		%			Average interest rate(b)(c)(d)	3.2		%		3.3		%	1.6		%	3.0		%	3.5		%	4.2		%	3.8		%
Variable rate(e)	Variable rate(e)	$	1,602		(f)	$	30		$	45		$	60		$	91		$	1,676		$	3,504		$	3,504	Variable rate(e)	$	740		(f)	$	45		$	60		$	91		$	1,066		$	—		$	2,002		$	2,002
Average interest rate(e)	Average interest rate(e)	3.8		%		5.4		%	4.8		%	4.3		%	4.2		%	4.2		%	4.0		%			Average interest rate(e)	5.6		%		4.7		%	4.0		%	3.9		%	3.9		%	—		%	4.6		%

(a)The fair value of our debt is based on indicative quotes, ~~(that is,~~ non-binding ~~quotes)~~quotes from brokers that require judgment to interpret market information, including implied credit spreads for similar borrowings on recent trades or bid/ask offers. These fair values are not necessarily indicative of the amount, which could be realized in a current market exchange.

(b)The impact of principal payments that will commence following the anticipated repayment dates is not considered (see footnote (d) below). The Tower Revenue Notes, Series 2015-2 and Series 2018-2 have principal amounts of $700 million and $750 million, ~~respectively,~~ with anticipated repayment dates in 2025 and 2028, respectively.

(c)The average interest rate represents the weighted-average stated coupon rate (see footnote (d) below).

(d)If the Tower Revenue Notes are not repaid in full by the applicable anticipated repayment dates, the applicable interest rate increases by approximately 5% per annum and monthly principal payments commence using the Excess Cash Flow (as defined in the indenture governing the applicable Tower Revenue Notes) of the issuers of the Tower Revenue Notes. The Tower Revenue Notes are presented based on their contractual maturity dates ranging from 2045 to 2048 and include the impact of an assumed 5% increase in interest rate that would occur following the anticipated repayment dates but exclude the impact of monthly principal payments that would commence using Excess Cash Flow of the issuers of the Tower Revenue Notes. The full year ~~2021~~2022 Excess Cash Flow of the issuers of the Tower Revenue Notes was approximately ~~$933 million.~~$1.0 billion. We currently expect to refinance these notes on or prior to the respective anticipated repayment dates.

(e)See note 7 to our consolidated financial statements in the ~~2021~~2022 Form 10-K for information regarding potential upward or downward adjustments to the interest rate spread and unused commitment fee percentage on our 2016 Credit Facility if we achieve specified annual sustainability targets or fail to meet annual sustainability metrics. Each period presented assumes the downward adjustments in the interest rate spread and unused commitment fee percentage on our 2016 Credit Facility.

(f)Predominately consists of outstanding indebtedness under our CP Program. Such amounts may be issued, repaid or re-issued from time to time.

ITEM 4.CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company conducted an evaluation, under the supervision and with the participation of the Company's management, including the Company's Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), of the effectiveness of the Company's disclosure controls and procedures as of the end of the period covered by this report. Based upon their evaluation, the CEO and CFO concluded that as of ~~September 30, 2022,~~March 31, 2023, the Company's disclosure controls and procedures were effective in alerting them in a timely manner to material information relating to the Company required to be included in the Company's periodic reports under the Securities Exchange Act of 1934, as amended.

Changes in Internal Control Over Financial Reporting

There have been no changes in the Company's internal control over financial reporting during the fiscal quarter covered by this Form 10-Q that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II—OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

See the disclosure in note 8 to our condensed consolidated financial ~~statements set forth in Part I, Item 1 of this Form 10-Q.~~statements.

ITEM 1A.RISK FACTORS

There are no material changes to the risk factors discussed in "Item 1A. Risk Factors" in the ~~2021~~2022 Form 10-K.

~~ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS~~

~~The following table summarizes information with respect to purchase of our equity securities during the third quarter of 2022:~~

Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs
(In thousands)
July 1 - July 31, 2022 1 $ 171.40 — —
August 1 - August 31, 2022 1 179.86 — —
September 1 - September 30, 2022 3 174.55 — —
Total 5 $ 175.22 — —

We paid approximately $1 million in cash to effect these purchases. The shares purchased relate to shares withheld in connection with the payment of withholding taxes upon vesting of restricted stock units.

ITEM 6.EXHIBITS

Exhibit Index
Incorporated by Reference
Exhibit
Number Exhibit Description Form File Number Date of Filing Exhibit Number
3.1
Composite Restated Certificate of Incorporation of Crown Castle Inc.
10-Q 001-16441 August 5, 2022 3.1
3.2
Amended and Restated By-Laws of Crown Castle Inc., dated August 1, 2022
10-Q 001-16441 August 5, 2022 3.3
10.1
Amendment No. 7 dated as of July 8, 2022, among Crown Castle International Corp., the lenders and issuing banks party thereto, and JPMorgan Chase Bank, N.A., as administrative agent, to the Credit Agreement dated as of January 21, 2016, by and among Crown Castle International Corp., the lenders and issuing banks from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent
8-K 001-16441 July 8, 2022 10.1
31.1*
Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002
— — — —
31.2*
Certification of Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002
— — — —
32.1†
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002
— — — —
101* The following financial statements from Crown Castle Inc. Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, formatted in Inline XBRL: (i) Condensed Consolidated Balance Sheet, (ii) Condensed Consolidated Statement of Operations and Comprehensive Income (Loss), (iii) Condensed Consolidated Statement of Cash Flows, (iv) Condensed Consolidated Statement of Equity, and (v) Notes to Condensed Consolidated Financial Statements, tagged as blocks of text and including detailed tags — — — —
104* The cover page from Crown Castle Inc. Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, formatted in Inline XBRL — — — —


		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File Number	Date of Filing	Exhibit Number
3.1	Composite Restated Certificate of Incorporation of Crown Castle Inc.	10-K	001-16441	February 24, 2023	3.1
3.2	Certificate of Correction of Restated Certificate of Incorporation of Crown Castle Inc., dated February 23, 2023	10-K	001-16441	February 24, 2023	3.2
3.3	Amended and Restated By-Laws of Crown Castle Inc., dated August 1, 2022	10-Q	001-16441	August 5, 2022	3.3
4.1	Eighth Supplemental Indenture dated January 11, 2023, between Crown Castle Inc. and The Bank of New York Mellon Trust Company, N.A., as trustee, to the Indenture dated February 11, 2019, between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee, relating to the 5.000% Senior Notes due 2028	8-K	001-16441	January 11, 2023	4.1
4.2	Ninth Supplemental Indenture dated April 26, 2023, between Crown Castle Inc. and The Bank of New York Mellon Trust Company, N.A., as trustee, to the Indenture dated February 11, 2019, between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee, relating to the 4.800% Senior Notes due 2028 and 5.100% Senior Notes due 2033	8-K	001-16441	April 26, 2023	4.1
31.1*	Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002	—	—	—	—
31.2*	Certification of Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002	—	—	—	—
32.1†	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002	—	—	—	—
101*	The following financial statements from Crown Castle Inc. Quarterly Report on Form 10-Q for the quarter ended March 31, 2023, formatted in Inline XBRL: (i) Condensed Consolidated Balance Sheet, (ii) Condensed Consolidated Statement of Operations and Comprehensive Income (Loss), (iii) Condensed Consolidated Statement of Cash Flows, (iv) Condensed Consolidated Statement of Equity, and (v) Notes to Condensed Consolidated Financial Statements, tagged as blocks of text and including detailed tags	—	—	—	—
104*	The cover page from Crown Castle Inc. Quarterly Report on Form 10-Q for the quarter ended March 31, 2023, formatted in Inline XBRL	—	—	—	—

* Filed herewith.

† Furnished herewith.

3629

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

CROWN CASTLE INC.

Date:

~~November 4, 2022~~May 3, 2023

By:

/s/ DANIEL K. SCHLANGER

Daniel K. Schlanger

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

Date:

~~November 4, 2022~~May 3, 2023

By:

/s/ ROBERT S. COLLINS

Robert S. Collins

Vice President and Controller

(Principal Accounting Officer)

3730


		Page
PART I—FINANCIAL INFORMATION		3
ITEM 1.	FINANCIAL STATEMENTS	3
	CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)	3
	CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited)	4
	CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)	5
	CONDENSED CONSOLIDATED STATEMENT OF EQUITY (Unaudited)	6
	NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)	87
ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	2016
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	3427
ITEM 4.	CONTROLS AND PROCEDURES	3528
PART II—OTHER INFORMATION		3529
ITEM 1.	LEGAL PROCEEDINGS	3529
ITEM 1A.	RISK FACTORS	3529
~~ITEM 2.~~	~~UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS~~	35

ITEM 6.	EXHIBITS	3629
EXHIBIT INDEX		3629
SIGNATURES		3730


	Common Stock			AOCI
	Shares	($0.01 Par)		Additional paid-in capital		Foreign Currency Translation Adjustments		Dividends/Distributions in Excess of Earnings		Total
Balance, December 31, 2021	432	$	4	$	18,011	$	(4)	$	(9,753)	$	8,258
Stock-based compensation related activity, net of forfeitures	1	—		140		—		—		140
Purchases and retirement of common stock	—	—		(64)		—		—		(64)


Other comprehensive income (loss)(a)	—	—		—		(3)		—		(3)
Common stock dividends/distributions(b)	—	—		—		—		(1,913)		(1,913)

Net income (loss)	—	—		—		—		1,261		1,261
Balance, September 30, 2022	433	$	4	$	18,087	$	(7)	$	(10,405)	$	7,679


	Three Months Ending December 31,		Years Ending December 31,
	2022		2023		2024		2025		2026		Thereafter		Total
Contracted amounts(a)	$	1,208	$	4,760	$	4,338	$	4,010	$	3,929	$	22,736	$	40,981


	Principal Amount		Cash Paid(a)		Gains (Losses)(b)
Tower Revenue Notes, Series 2018-1	$	250	$	252	$	(3)
3.849% Secured Notes	1,000		1,022		(23)
2016 Revolver	—		—		(2)
Total	$	1,250	$	1,274	$	(28)


	Three Months Ended September 30, 2022								Three Months Ended September 30, 2021
	Towers		Fiber		Other		Consolidated Total		Towers		Fiber		Other		Consolidated Total
Segment site rental revenues	$	1,084	$	484			$	1,568	$	972	$	479			$	1,451
Segment services and other revenues	175		3				178		162		5				167
Segment revenues	1,259		487				1,746		1,134		484				1,618
Segment site rental costs of operations	230		166				396		227		163				390
Segment services and other costs of operations	114		3				117		108		4				112
Segment costs of operations(a)(b)	344		169				513		335		167				502
Segment site rental gross margin	854		318				1,172		745		316				1,061
Segment services and other gross margin	61		—				61		54		1				55
Segment selling, general and administrative expenses(b)	28		47				75		27		44				71
Segment operating profit (loss)	887		271				1,158		772		273				1,045
Other selling, general and administrative expenses(b)					$	81	81						$	69	69
Stock-based compensation expense					38		38						33		33
Depreciation, amortization and accretion					430		430						413		413
Interest expense and amortization of deferred financing costs					177		177						163		163
Other (income) expenses to reconcile to income (loss) before income taxes(c)					10		10						9		9
Income (loss) before income taxes							$	422							$	358
Capital expenditures	$	45	$	277	$	15	$	337	$	46	$	229	$	8	$	283
Total assets (at period end)	$	22,226	$	15,914	$	721	$	38,861	$	22,239	$	15,813	$	952	$	39,004


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs
	(In thousands)
July 1 - July 31, 2022	1	$	171.40	—	—
August 1 - August 31, 2022	1	179.86		—	—
September 1 - September 30, 2022	3	174.55		—	—
Total	5	$	175.22	—	—