Earnings call transcript Q2 2023

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Operator

Greetings, and welcome to the Altice USA Second Quarter 2023 Results Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Sarah Freedman, Investor Relations. Sarah. you, Thank

begin. You may

Sarah Freedman

and thank everyone, for you Hello, joining.

share we as is Brown I’m first he to begin, thrilled that baby. their currently welcomed his have Nick family Before and recently on parental leave,

are we Dennis questions take about available CEO, CFO, you agenda, our the and to joined by and Chairman Mathew; together Altice who Sirota, for presentation our today Marc through results. and USA’s will be Turning then

go Slide ahead. contain may statements, read X. forward-looking Dennis, on please As today’s presentation the please disclaimer

Dennis Mathew

the Thank communities a when Kicking joined sustainable that of and provider to financial we you, all to on the I’m off connectivity on the focus And I and today, USA, year, make across execute choice on October business. Nick. that Sarah, would with our to congratulations operational delivering big discipline to for in act in serve. Slide this be committed share we’re I the X, pleased of Altice strategy great and last Optimum with at company that continuing across we mission to improvements progress

We’re our seeing customer in across significant and and experiences investments field improving operations. simplifying experience due care, broader support service achievements to our

to higher growth diligence this is in satisfaction visits space Our NPS and metrics including service in double-digit and volume, customer leading in call reductions impressive overall rates.

the addition in led operating costs lower performance to and compared on focus has prior in for better creating stronger resulted customers Our to year. net our experiences has the quarter

planned, cements quarter, launched Fiber a passings, The more our widest deliver nation’s competitive in the us value strengthened advantage million Internet the gives quarter, speeds Symmetrical and product provider, to milestone X-Gig the availability Internet experiences our to we than unique X.X of Notably, as the X-Gig earlier largest we the in customers. marketplace. greater country. X-Gig and to representing Optimum than portfolio offers and ultrafast and This in

by stabilization with delivering financial seeing discipline. and our on better operating financial in experiences metrics by executing and customer greater we Finally, are

best Our strategy execution and to to provide the best the businesses. best and the and experiences stronger is trends operational Residential products, employee financial discipline leading best customer experiences networks, our across BXB the through

the quarter, I are Our work am leading and about indicators is which done, in return to broadband the not of but optimistic cash growth. achievements a here sustainable flow

X, detail Turning X and greater to key to these pillars. in Slide I’d into revisit trends our like strategic get

First, on people and moment a our our culture.

sales, product, talent retain welcomed do. U.S. can be a experience develop other and team. run operations our high attract, over the everything the Optimum. remains our Over telecoms leaders critical at the existing attracted XX that to to so us, we’ve that and cable from for care, in priority we We’ve across industries and last significant we with executives months, complement to positions best-in-class several new performing finance, Continuing

now includes every leads sales, in serve. P&L, experienced We we positioning achieve that response, the new community also hyper-locally be us done will growth experience X engagement. our dedicated drives competitive and new of this and manager, regional experience, drives owns areas has that operations With the who community each and employee that model, general an customer not provider more recently before, introduced ways have nimble act choice we in to a new allow connectivity and our footprint us regional market across be structure of and to responsive that

we continuing the right to of right and empowers our a I’m commitment bring national us structure employees. to deliver the approach leverage to teams on strategies our markets now Recognizing the of part while customers in be forward. organization the a with and experience, that large will the going who accelerate based advantage each characteristics for people competitive of focus and confident ability have will benefits differences our local go-to-market This being our unique market.

Turning to our growth pillar.

reminder, our internet of and Complete the services plus we a offer, outside power inside mobile May, market As demonstrating Optimum the connectivity converged entered our the with in home.

Mobile We’re attachment pleased attention saw with early the acceleration. results by our the bringing doubling more service, to for since and of it mobile Optimum We broadband to mobile launch our more evidenced as with specifically and impressive new the attachment have is rates than grow. Complete customers, room

accelerate lifetime Complete not value Optimum it value. greater stickiness customer proposition translates to but The helps and only Mobile customer better growth,

to TV Store. Demand alongside access the also more, TV, our in service, video live We app Play that Stream, deployed Optimum and including experience DVR, available Google Optimum streaming any our On provides full streaming other

viewing and creates sleek, and fiber of It in include and lightweight a allowing is to help migrations. connection, it available to fiber video full blend accelerate be installation. fully video primary compared fiber linear majority Optimum to select To all also solution. now upgraded marquee more our by remote is self XX digit better across HFC voice the will easier to end, that to officially available and our will this the and of new on as doesn’t streaming. is available their our is require addition markets in video year. it product additions customers just and which and the customer markets customers end to And boxes, customers capabilities the Stream gives CPE options to keys The TV of experience for a legacy coax experience we

In proactive customer our addition, identifying the we opportunities of strategy. more and relationships to enhancement in retention thoughtful programs pricing through are way our a manage

ways exploring rewards for value also are targeted We loyal with speed gifting deliver greater including customers, increases. to tier

top-line our benefit and to remain of of and, course, our pricing value experiences our products competitive. is performance, goal Our simplify customers and to to the reinforce structure

this loyalty proactive markets to and retention programs select We out year. begin will later rolling pricing,

to gears Shifting an This for BXB. opportunity exciting area of is us.

leadership BXB rates our more our utilization onboarding, through our June, We business team strategy our BXB an way. new meaningful and in refining brings go-to-market as converting improving to a conversion strategy, on product customers are renewing focus regimented better through fiber of which experienced around a with growing expanding portfolio, business

At versus which business connections immediate requiring June, our progress enabled was in end lines, an team of the already voice having single expanding take hosted multiple portfolio, in this making product rate. line resulted

addition, scale voice all we to continue to fiber multiline offer services our of sizes. customers capabilities In to

We BXB working bundle are year, this solutions and services proposition the and to business customers actively across later Complete to voice the the will value of best availability broadband customers. Optimum our west expanding on of mobile launch a services business bringing

the the seeing as Tier Other X a growth network largest wireless carriers. X superior opportunity quality include circuit within reinforcing of carriers, partner to areas to of in sales are trusted our fiber and Tier we BXB wireless nation’s some

win saw local e-rate connectivity for on K bids upcoming the education year, providing also rates XX solid integral We through segment. school services for

Moving to our pillar, third network. the

we quarter, Fiber than million Symmetrical to As passings, launched I markets. X-Gig X.X service which strengthens our mentioned fiber more our the available in competitive in advantage

to many symmetrical to could and upgrade used deployed experience, state would our significant is by other that to Optimum capital network because performance. XGS-PON launch using is X-Gig the or speed. investment from of our art older network legacy today. it’s fiber And infrastructure speeds multi-gigabit Our to technology, new Fiber providers speed, which match enables G-PON superior technology ability standards the it XGS-PON a require likely

faster DOCSIS passings the to additional upgrade we enable to XX,XXX West, X.X to network an continue QX. bring remaining Optimum in and we more speeds In upgraded bandwidth;

and a over X.X X.X, share we megabits and mid-split pleased the I’m we up a speeds also see over to we’ll DOCSIS path to pressing to multi-gig are in teams great upload deliver actively using Our at DOCSIS successfully speeds architecture. our that X XXX speeds gigabits innovating, tested deliver download labs speeds to and value. best keep

Thanks to which offer in to to us DOCSIS faster multi-gig, as footprint, all broadband our of grow. our X-Gig gives usage to tremendous and of upgrades, runway capabilities fiber entire both customers continues we our almost fiber boosted we’ve bring and to speeds speeds XX%

which broadband our know, all services what we to due our to is reliability, customers. Finally, our with XX.X% delivered most matters are investments,

This team leads the a is customer company. fourth at which our across to single pillar, every priority experience,

better at digital We’re bringing forefront experience. customer to finally the getting of

Earlier For that the year, as enable customer a cost example, we text communication launch journey. planning committed and I were control. this of new part as app correlation Care a to direct CX message we on

we which new and home Optimum Wi-Fi to and digital an make experience, that in offers bill, in enhanced their intelligent troubleshoot their issues service payments for pleased one this began customers app, week rollout to Optimum manage last manage all assistance, My app I’m using place.

simplified our customer. better impact services, into on cost Our our metrics, experience customer progress From to meet having to to access to significant. customer the direct our onboarding experiences providing here a is lower programs which translate needs. serve are help improving offering understand to experience tools and These our customers

customer the what strategy toward we review the direction optimism Marc growth. experience and to this and Marc can turn executing I will Let’s growth. track. all would KPIs, before see in turn now a successfully Slide metrics, you That return of few us frequently KPIs and asked get and later to financial we to some give we are which to right of expect slide, our get we a heading customer On back financial X. that these

improvements increases once points across in with care, about a increases our our each resonating service signal NPS First on making including QX. that again to visits, customers NPS, and our for our a feel tNPS net customer’s seen onboard year-over-year across NPS Optimum. of of experience, services promoter or sales. is these in range and up improving customer on field, services wide simplifying and and These point impact score, dedication categories. an experience to transactional measures XX our willingness is fiber tNPS, recommend the how We’ve scores, retail, double-digit

experience connect even minimizes Another customers, adoption faster for we customer and cost and having our are services. wider our the teams and enhanced clearer, important for self-installation and have our highlight simpler on the business. to it’s a impact Optimum onboarding our how time self-install Self-installation to it make the to easing process of is both with

the of gross tremendous We pace last year, sales, effort our in with field had This accelerating QX year. success has at simple this partnering grown and additions single qualified in to QX give point. every up of solutions a and of our QX in care been customers XX% teams functional new have XX% from to in self-installation, which year-over-year great has XX% touch cross

an business, it will and truck installation the Customers us, rolls. at-home require choosing yields a remains for many fast, benefits. translates and is appointment, into that huge for a we easy doesn’t in fewer year. and it of a into over be Customers leaning half Self-install our more this opportunity self-installation it install enjoy professional second

by service visit troubleshooting tools effective trends roll both network truck overall piece adoption truck and lower with just combined the and higher self-installation on rolls, to simplified our improved Moving one of quality and is product supported customer XX% fewer truck customer a months, We’ve which XXX,XXX over side and service at seen the last in our a the a field requires visit operations. decline in annually. rolls XX rate

both truck which In addition network frequency are fewer we we maintenance repair. to better tools network rolls service to quality need at rolls, and around truck perform through improving network visit the lowering

rates tool identify the and this to Earlier is exact this find year, management, which resolve network now ride taps, the to our Traditionally, advanced launched other we network and costs, resulting as of network for Lower a experience. and with network improved required us cables, rolls overall team truck new out for can customers, damaged But location while pinpoint new a volumes issues better a to tool, launch faster. reducing faster of enables service continue such superior or proactive equipment. visit issues our to truck roll OpEx impaired lower time identify a to repair, for related us service impairments. lower in huge physically opportunity network, delivering to fewer reflect detection, experience

our at contact features, customers We in thanks we less into note, technical annual calls troubleshooting XX questions also us QX account improving self rate decline, XXX,XXX year-over-year. the last proactive months, saw communications ongoing same our see experience in to for or the service call and inbound continue the On centers to X% improvements. which

onboarding customer very call, improve churn. and customer on customer everything ensure around. to First the needs. to right or getting is are addressing get customer and solved laser we care from technical time time beginning a solutions when to customer first is thoughtful, the right experience tailored we first focused experience do we to it and attention the that on we give any consider want motto, we voluntary is time This when specific each our And that also installations

which reducing incremental focusing improvements indicators the on to XX in Year-over-year and the seen press to cost early deliver Overall, hard see flat continue QX these that that have while structurally months, on KPIs these voluntary churn was continue over proving despite experience will to customer areas trends. churn strategy, in voluntary relatively easing experience on progress pain support improving customer gives customer and competition our points we are we trends. the total runway us best are to last making operating we and

Altice turning harmful individuals before to take to and it the Finally, want authorities I coming and a practices the Portugal quarterly and month, have was was to Marc the Portugal. company our business of defrauded review result that address with identified performance, as of certain news you over to of may the external a Portuguese authorities. financial and misconduct seen Last moment entities, that cooperating allegedly out

CEO, Board commencement of internal as addition XX-year him immediate in a at decision the have in Altice we In response subsequently procurement investigation appointed launch Officer, in of Jennifer the was the hired and circumstances new made to the Procurement I we my these placed to our head Chief our Portugal, Since on USA. responsibilities we prudent investigation, own a industry. to Yohe, leave. and U.S. have and the of procurement separated cable Chairman veteran

In spend operations. impact our proactively we’re go are to vendor short-term. pausing have some where capital construction targets investigation, needed our we will existing relationships currently onboarding scaling Additionally, completed until and fiber supplier vendors, our our in and reviewing both which we and new forward strategies support and the parallel,

penetration drive ramp-up customers. our and this are customers targets. to network, to and full performance metrics this from sales passings see the We opportunity an as And especially fiber strong fiber currently using on given reviewing more machine our we continue CapEx and existing year marketing to our

move will In best the employees the forefront. the of our any at if operating your so. do anything have to summary, course, We we time. additional business highest not And, will to conducting the we are there committed do share stockholders, with to this understanding customers with interest is share appreciate in material to we forward continue integrity our at and information and of that future,

to now, I’ll over it turn And Marc.

Marc Sirota

Thank you, Dennis.

begin key reflected how like performance. to QX Turning highlights I’d operational X, to with to that commitment and and is our Slide in some financial our discipline demonstrating

time net for go first in promising stabilized broadband we losses, First, broadband year, quarters, and the versus of have forward our a indicator the X adds we’ve prior expectations. improved customer

speed and that continued QX our ARPU, of grown path ARPU acquisition I’m highlight broadband Residential excited sequentially disciplined up-tiering to on segmentation. to have stabilizing in declines, through and Moving we we’ve retention ARPU pricing,

peak operating of operating from QX back have to come which improved declining come momentarily. Our recent trends, of will costs in to down QX, costs in our spend sequentially These lower QX and XXXX. contributed from the margin OpEx

stepping by In quarter moderation, XX%. addition CapEx spend in sequentially down down OpEx brought QX, capital versus first we to

to loans to last, we to new the XXXX, guaranteed debt outstanding under XXXX senior at extend And XXXX credit in we engine want last address undrawn us are the with to our used transaction we I well QX following facility. did maturities. balance, drawn a XXXX. end out year We proceeds and combination highlight near-term billion We RCF borrowings of positioned a term our through that schedule amend of half billion note maturity well over positions cash extend the of that repay which and about April the $X.X ended and liquidity raised to revolving $X

and opportunistic continue proactive will debt in we maturity to be always, our profile. As managing

on quarterly trends. Turning customer to X, let’s Slide go deeper

the during to year-over-year. time primarily university disconnects due a our of As XX,XXX QX seasonally low I of Optimum Recall, in our footprints, Dennis of Optimum more quarter stronger X,XXX net XX,XXX to QX XXXX, typically second impact sign we have quarters, in of year said prior an we net the in to improvement earlier, losses a the a approximately additions lot adds strategy it’s in taking hold. is first compared Still with in reviewed came for but in West. as work in the point first do, that net to X compared

Furthermore, these ongoing and Despite through of do fixed operators. the environment improved strategies. go-to-market we both and slow network in a plus fiber upgrades we’re by we wireless low fiber headwinds, pressure our have and housing improved continue trends where move footprint impacted see be from parts competitive competing market we to our

competitive continued our While out focused and are the drive industry we we improved much performance. on of macroeconomic remain trends of can control, how

As which individual the as to partly an we those example proactively programs our highlighted of as of nearly are to by non-pay year-over-year QX, XX%, this, macro customers. new recall programs to to quarter, due pressures. last we declines their to In trends reduced care bills worsening due, for needs notify well year-over-year customers when attributed we

significant we compared year. As into to QX who a saw result, collections in customers went reduction last

ways leading Another and communication customer example to experience, are improved that we of overall our trends. customer enhancing

marketing superiority, In our that strengthening advertising unmatched value the our directly to addressing addition, by ensuring are of experience by know speed, network competition new highlight entrants. is we Optimum product and and quality and customers

Mobile right earlier, side, free to mobile between seeing to subscribers. close we last mentioned quarter the acceleration are we paying XX year months lines customers only in free plus for growth, as and include Optimum XX,XXX or I to X-gigabyte migrate expect mobile adjusting plans majority the the lines when legacy QX, Recall of a in ran gap XX,XXX the and by free data adding as promotion the adjusted mobile next plan. reported for off begin On

as Mobile trends employees to Optimum better incentives channels. sell distribution our existing are training our positive help Optimum through as our Mobile and in by well supported Complete offer, Our Optimum sales and promote

revenue Residential revenue and with sits our other. revenue light to like in Business Service in in Residential in have Complete, of ARPU. updated converged now reported around our that note lines Optimum service equipment revenue Mobile I’d is mobile and Finally, disclosures strategy we

XXXX connectivity updated align this revenue through to our per revenue all on focus across in have ARPU reporting. with disclosure We our restated account improved highlights driving solutions. This of average

X, year-to-date, under we’ll fiber to new more an passings XXX,XXX in just progress. X.X the review quarter, than brings which in passings We fiber our passings. added to Moving fiber with Slide QX us fiber ending XXX,XXX million additional

new We voluntary additions new continue XX,XXX fiber migrations growth to existing accelerate of customers the and additions, customer fiber customers. pace of through adding

and at customers, cohort. of see continue QX this performance benefits out ended to XXX,XXX We and we fiber satisfaction

customer our markets. trends broadband HFC, product higher First, versus which our continues on NPS fiber trending improved in fiber reflects

customer per product revenue broadband we of monthly significant survivability And seeing to point our fiber Second, XX new compared churn opportunity. differential HFC a reduction better customers. last, new are consistently months fiber higher versus taking remains for first customers after over indicates on HFC, a which the XX%

to per continue speeds. and this month up. average to usage Today, XXX-gigabyte see continues we faster customers of usage, On wanting trend data broadband-only customers’ taking our over and

plan speed handle well the it to level of and this our fiber usage symmetrical can in to majority deliver has Our beyond up capacity the X-Gig footprint. fiber of now data

is move the capital as focus spends. mentioned, customers new with sales some as fiber Ahead, onto temporarily more Looking Dennis we and ramp-up our today marketing to respect network pause our to to fiber program

date focused technology. most on fiber upgraded East builds are East Optimum Our to of fiber advanced about the footprint the to with XX%

just penetration our have passings million We fiber of X.X today. under XX%

scores, experience strong it’s superior improved of benefits We going quality, experience or and better as makes on opportunity while and ORI an technology a company. With legacy service, other know to rates backdrop more this churn metrics fixed use NPS [ph], it our us any network to and forward. is wireless for whether fiber financial sense customer drive strengthening our customer fiber, than

the relationships best best Optimum. market goal Our customer leadership network as reinforce to our the to attract to is

declines driven of X.X% QX, XX by Residential X.X%. Services we’ve X%, Business the year-over-year, segments revenues down losses the X.X% driven down X.X% and broadband In our revenues Lightpath cumulative video other businesses. declined Turning seen subscriber was and year-over-year, SMB News impact over and driven on Advertising and total mainly revenue to year. and year-over-year, last by by Slide Residential in declined declining expenses. and revenue

been termination in early services business one-time would Lightpath Sprint X.X% total revenue excluding prior would grown the down have and X.X%. have Although period.

QX, other, News revenue. revenues decline and excluding X.X% in or Advertising down XX.X% Within political year-over-year

slowdown in through underlying up revenue roll-offs see spend, hand the The stepping right sequentially; side channels. as sequential to continue representing up-tiering QX. direct ARPU We macro see disciplined but growth trend promotional in shows well pricing advertising growth our and weighted as quarterly towards on

of due increase in to Programming as with overall loss. to down usual, programming but continue costs to rates a step-up continue QX more video come customer

declined expenses, in We in continue $XX in see to million stabilized the QX QX excluding lower is from million sequentially OpEx XXXX. have also which recent by lower than of operating X% $XX or share-based which peak QX, compensation,

OpEx Fewer that improved self-install improvements recent the a structurally Dennis result volumes, more trucks, trends metrics across costs, that with while customer The our are earlier. many enhancing call highlighted operating of direct operational our experience. lower operations reduce improved along other

disciplined our a side. cash the XX.X%, XX.X%, spend and moderation approach margins This of on quarter basis adjusted reflecting and leads to volume margin CapEx to expansion compared In balance to X trends. on QX, Slide XX flow saw of margin expansion rate EBITDA operating sequentially QX quarter, points the of which quarter-over-quarter. in sequential quarters. points XXX In the XXX free is margin reflecting increased we EBITDA us basis was prior the our revenue expenses Operating first to in margin

or XX just sequentially excluding QX of $XXX and FTTH representing would million, to capital. XX% new CapEx, me over spends XX.X%. in brings stepped Slide This down capital spend on capital versus $XXX QX was been build QX. million have capital intensity Capital XX%, intensity

We investments growth QX reinvesting and into where business. are we back on have areas remained focus in in capital the opportunities

XXX,XXX we’ve passings new passings, fiber upgraded building DOCSIS X.X. QX, and passings XX,XXX XX,XXX added to In

capital spend may full of we half completed fiber our should the As lower see Dennis and noted guidance and for year. earlier, in come in to a CapEx the below you second expect passings level prior

due to the with bill cash last, bridge cash quarter $XXX flow and second of timing of million And QX, to positive higher fiber million, the the million. project quarter. capital the XX spend $XXX a negative flow was a due free in taxes in principally free the Without the for associated our capital Free additional is our Slide on in have payments cash would cash been fiber flow. of quarter $XX higher

We full continue be down. and year CapEx year to for cash back as expect improved flow the half continues positive step of free to in the the to

to of QX, we will on in set back the that quarters steadfast many continued flow few return getting revenue, have commitments out and target summary, the leverage we EBITDA deliver over to on us remain sustainable last In our to cash growth customer and levels.

And with that, thank you all for your time.

We and will ask they focus Operator? now that questions business take performance. on our

Operator

Thank you.

now question-and-answer conducting a will you. We session. [Operator be Thank Instructions]

from is Please question with question. first proceed Feldman Sachs. Our Goldman Brett with your

Brett Feldman

for how question. us here into you give this you’re really of comfortable as of for if rest you full much And I year. be a through to can scope of not reevaluation in Thanks about can of with off Thanks. project? think we may the pause any funnel? taking be how insight the out modeling of through holistic lower this have going reassessment going actually visibility we’re what just so going procurement while capital Or the more fiber upgrade the to intensity integrity the predominantly is appreciate is you doing are the just maybe then kind phase, it I’ll the CapEx. assessing you’re long start but to

Dennis Mathew

And authorities us the trajectory we about conduct that vendors, had CapEx who are through that fiber investigation supporting media we’re Hey, our investigation as a as number I on some of part Marc a the we your about the of Brett, Dennis. learned begun, the when a began here. investigation vendors going and Portuguese the mentioned, comment let question, thorough I’ll our well. But the from includes of perspective. and to this second own of talk I’ll is

very and And as we as and continue growth we as strategy here. to conduct we proceed it’s this take pause to a drive and to feel we look so, prudent investigation, continue us fiber our as at, for will more we learn and strategies we moment

bit on can of Marc and a guidance on what little fiber expecting But we’re side. CapEx provide the

Marc Sirota

anticipating get potentially the Yeah, at sight total paid are to that Brett, we we have of the passings previously will process, least as should in than disclosed. investigation, firmer about XXXX we million fiscal kind $XXX you have to, capital for, committed we deeper a we the of line million in mentioned, already given intensity would imply that $XXX but into construction less XXX,XXX for and as completed originally in

Brett Feldman

Thanks color. Okay. that for

Operator

Thank you.

Cusick Our JPMorgan. is proceed with question. Phil from with next question your Please

Phil Cusick

competitors. then couple as be expectations well. your Thank And talk next side would in wireless Hi, guys. about Dennis, you on over as churn second, Can but about the all incremental fiber We’ve you could your competition seeing mentioned the not fiber you. you of if quarter-to-quarter? talk That those you’re quarters heard at year-over-year, year-over-year. over what from and just off? of X gross backing start fixed the and comping promotions some great of coming you off wireless from higher last months some

Dennis Mathew

a we positioned, why see as provides believe there’s still the from when course, look Phil. footprint, at data value competition when fixed wireless, across and we do the perspective, of we It Absolutely, we that’s both capacity and looked very From aggressive at other bundle We look you competition see well we’re availability. at you Complete. launched fiber providers. broadband Optimum constraint. we mobile But that with availability

have with a a and we savings. $XXX product So annual better better value

while competition, we fiber the very see fixed we while wireless comfortable. see so we’re And competition,

right We tools. have the

increased seeing West. also competition fiber in We’re the overbuilder

management Optimum has which tools more now And in XX% local the put again, team place. to with As Complete compete. the at I’m data, that West, that I it’s to XX% our we think very XX%, believe do historically the grown now about we the But in been right range. excited that looked in we’ve we have

And as into offerings, growth that that they We more able look effectively level. able be get us we nimble compete our and competitive are to at to town evolve deployed as VPGMs are much drive we town. footprint to the going the level at be by local be have local help at across and we’ll to

feel really So good we about that.

free promotion be roll that through subs, QX off there’s On been mobile the launch paying XX% We Optimum seen going a able We in last there’s of stabilization. feel of We’ve will little side, think growth into we that more year. to offered Complete. QX. the Mobile think we’ve that to we since convert the about so good those bit really of

been our to able rate have We mobile. of attachment double

Mobile, mobile view we to going the so see And in half. we’re to that second continue acceleration

Phil Cusick

Thanks, Dennis.

Dennis Mathew

Yeah.

Operator

you. Thank

next question. Our Swinburne with is Morgan your with Please proceed Ben from question Stanley.

Benjamin Swinburne

Hey, questions. guys. guess Good two afternoon. I

sales the efforts. kind about of I tell some may of talked guys CapEx this redirecting of up savings your that seeing year. ramping be You sort you’re you couldn’t if

I been or per quarter, negotiating a you this seeing think on quarter forward? to so in volume more color get about that. onetime and sort I this so or X% over a costs, on they’ve sure think you. I were prepared million little any into about help drive $XXX to things per then like that sub anything lower, rates are customer trending growth cost up guys your And there. remarks, maybe programming thinking comment going or you OpEx better to was a of try Thank if wanted the I programming guess, Not talked basis

Dennis Mathew

throw Yeah. it programming part, Ben, I’ll I’ll side. and on the Marc first over take the then to

On about it’s driving at OpEx. not the sales, up all

and incremental fiber that drive. in level made to up system built have need the footprint. We the we not that fixes our are ensure in execution. driving have and effectively are we’ve to we operational system level all more and fiber made It’s selling where changes about board, our fixes offering OpEx, to did we offering and fixes, fiber still some some footprint. We so stabilized channels. There’s we’ve fiber that circumstances some were we continue execution We’ve across

on perspective. was In date, We’ve and best of add fiber around going messaging we delivered in centers, also is continue we’re which and adds the these gross fiber migration to that our QX, gross so on side, effectively that drive can we in of the to the XX% was adds, that our more side. XX% retail from invested quarter to XX,XXX door-to-door, in a channels sell

adds from more gross I through operational that just So more disciplined can execution, we believe a drive perspective.

also stream. in video are very fixed. past that that execution a talked We now we’ve on solution excited challenges works some about. there side, the On we’re the that that migration we’ve fiber have about I had

were the there. – double had had play, challenges folks did past, migrating have we we in that some As we

new we’re able with migration drive excited as well. the stream being And effective solution, so about more now to

so, is drive go this all we to about as continuing And our execution forward.

I’ll And, about to the bit a cost. it Marc programming throw over to little talk

Marc Sirota

Yeah. or onetime per decline customer from a Hi, the on on real in perspective. a basis reflected you basis customer No per programming a items Ben. increase see significant

we were call, improvement video As on mentioned that on focused the well. very a part and I margin of is as previous

and so, much our around pricing to we’re fact, taking grown in margin shifts. And a more basis video video over see due partly sequentially we’ve approach and, that’s XXX tier the to partly you can due points disciplined business and mix

And the so, drive some to those profitability try of video that up. to are things doing we’re

Benjamin Swinburne

Thank guys. you,

Dennis Mathew

Yeah.

Operator

you. Thank

with Our next question Please question. is from Moffett MoffettNathanson. Craig with your proceed

Craig Moffett

I questions, could. if Two Hi. Thank you.

[ph] comment Cheddar on in and then, and talk and about can broadband you’re competitive you’ve you West? of pricing First, And the just you how pricing your if ensure I’m Verizon reports if how that. about is second, favorite standalone if my sale about broadband that updated thinking topic, the could all with at your wondering Fios competitors to your about pricing possible

Dennis Mathew

Hey, Craig, Dennis. is this

not Cheddar. on rumors you to or today going press As address can speculation understand, we’re

base the a bit about and management I business, we’re journey and on going strategy we’re that focused across very This our a a to be We’re of pricing. little on. now. little about of all right thinking talked is about lines executing focus and so how bit our driving that’s

to that a is focused doing absolutely part And is growth, growth, in of that are very we retail strategic sure we revenue that part base EBITDA make fashion. subscriber that want and driving We’re growth, and on pricing. of management,

On the so relationship And reduce had not have how between at opportunity to more gifting, do program. the with there, side, doing look we’re a provide the speed simplicity, pricing. customers there’s loyalty we we’re the then pricing that promotional make going start take base to a like gap and really and we on things reducing management clarity, that the want and a implementing sure do number we of retail step-ups side, pricing

navigate across our actively manage is our bit pricing and first, at we and that, going can look with looking a we as the we and fiber, through at begin the we’re so are board, there, footprint. to so smaller And that across sub-base then

And we simplicity, the working so strategy while move I that growth forward. in that believe be and and we gap overall transparency, continue move of we’ll subscriber the time will that step-ups half first are EBITDA driving we to close to revenue as that, on more top-line strategies to less But fiber, come some on market, we forward, the all year evolve for growth. as provide and and want do

Craig Moffett

your bit say, a you or than, West? be rack still full with a there have Fios parity price AT&T Is rates being sense higher the at in Verizon with to competitors that quite

Dennis Mathew

In speed really Complete have we’re and we drive We to a to competition. starting local we of is level a able that tools going be West, is great host allow to The that win. tool. believe gifting the deploying whole Optimum to just to are a that’s great win, us strategy

to markets and a our going that’s host year side. some whole on allow of the that deploy to management tactics of base us really this We’re later to drive going in

we’ll provide We’re going that loyalty to in on some more deploy program the next start to and meeting. the details

improve as experience. homes, and continue West to that We X.X upgrade also the customer XXX,XXX believe DOCSIS the year, those up this that’s across take to going we XXX,XXX

that win ensure be are all and the are can West. to these so things that in And we competitive going

Craig Moffett

way, the and sure to from Well, is Nick, by congratulations who thank you, I’m home. listening

Dennis Mathew

we’re Nick family. excited for Yes, very and

Marc Sirota

Craig. Thanks,

Dennis Mathew

you. Thank

Operator

you. Thank

question. with question Please UBS. is John your proceed next Hodulik with from Our

John Hodulik

margin to question. Great. Thank the back Maybe you.

repositioning the there’s then You seasonal latter into need does Can continue nice And showed improvement we some or to the some half issues margins. stream look about? of sequential that into guess half sort is of video that number product? that’s the I at we from the year? key one. a as least Does margin the stream back the of of look help think or as year the we product, in standpoint product the

just of we want the or a the Or sub lot high CapEx back improvement hurt overall sort but of don’t But about I the slowdown into sort fiber parts. XXXX? number moving data of break year there’s speed on the into in on think to does as sort of harp for a But the investigation, two, of we as trends? that that this Thanks. look should half

Dennis Mathew

Hey, order John, I’ll of go here. reverse kind in

excited believe allow fiber our wireless. on strategies in X.X and to like us bullish that of balls upgrades all We we able mature management Optimum win. very we’ve fiber are about investments to to very us are against against hyper-locally. strategies. experience effectively local customer very the enhancements in market to continuing Complete fixed that overbuilders, effectively believe compete allowing broadband We’re and jump our that whole and local marketplace, – compete about optimistic The are a we’ve is there providers, allow that in team put will more We much continue to the and that us drive really – fewer to made so place and the trends, against being make in the

broadband So effectively second I continue we’ll the do drive believe half. very that to in

we as slowdown, the begun investigation. said, we’ve CapEx the On

are part that there to that that of fiber so related are which some vendors investigation, of build. are our And includes a number

and already are we now, that time. going that so at has moderate for are Marc to details And some this we share the to able of provided

providing and in we particularly In had where a much on terms of stream, a know terms with as solution as a challenges product solution historically. our we’re some video video of better fiber, solution, excited about

I driving and also from driving help think, we as video will forward. on So, broadband move us fiber this

I’ll a margin perspective, to Marc, you. From it throw over

Marc Sirota

we for pleased that year with XXXX. full in seen on significant we’re very mean, And rebound seeing OpEx very focused I the Yeah, the margins you’ve think here. we’re increases in

than see the I marketing. just very be tied saw. we that we’ll quarter in in the and second uptick pushing a to earlier aggregate margins expect moderate our I slight year rest for would mentioned But, you balanced margins little approach. of my to harder say again, better full half could As that take would and year first a a to I on remarks, the the

approach a we good now, on a and So driving continue feel and measured in take balanced we’re to like growth. spot we’ll

John Hodulik

guys. Thanks, Okay.

Operator

you. Thank

your next question Our question. with New from Jonathan Please proceed is Chaplin Street. with

Jonathan Chaplin

Thanks.

the two if little you And you on prevents quick guys looked in in I ones, that’s that week. big if doing at, us if your your that fiber structure I’m ABS this there’s of you the for subscriber versus saw in a can Thank wondering East fiber from similar wondering We So, a give market market something West. a the you. the capital assets trends price with assets. have if may. anything color bit then I’m deal

Dennis Mathew

little to question Hey a Jonathan, bit had. you over to Marc talk fiber I’ll throw it about

Marc Sirota

of considering we that news that Yeah, sources be and of well. the see for we ABS, financing alternative we drive and did we’re may as in all well possible business and that us the to as certainly and in considering at liquidity certainly kind and an as as much look are potential looking one will

Dennis Mathew

before, some to mentioned trends, We’ve headwinds well Yeah, subscriber year-over-year terms typically alluded That a on see of QX. QX number Marc got some less said, we being of I’ve XX% across as in we in macroeconomic the did is improvement. the slowdown challenging seasonally of East more as than did the said, subscribers. being X,XXX the That move by board certain some moves year-over-year in the as about improvement see months, challenges. as

We’re perspective. seeing customer improvement the nice side the on we’re making that some a with all voluntary from investments experience

our of drive couple and months Complete having that management customer teams the As was the year-over-year put have better; better QX we be will belts that seasonally that I continuing the to – Optimum place. momentum making of local having investments I post-pandemic that a pre-pandemic worse. has all think under with QX that do and was typically we’re more given typically think about seasonably QX, in leveraging been in seasonally experience we we’ve

subscriber so, I’m the optimistic move trends we about as And forward.

Jonathan Chaplin

deal Just in doing if anything deals you Is debt a there an that? negotiated sort that could. I to would for complicate prevent or structure doing like from of Marc your follow-up ABS newly quickly,

Marc Sirota

from Yes, anything deal. not doing that preclude ABS is Jonathan, there an would us

Jonathan Chaplin

very Amazing. Thanks much.

Dennis Mathew

Yeah.

Operator

you. Thank

your Maral question. Please Evercore ISI. with from with next proceed Our is question Kutgun

Kutgun Maral

ARPU, broadband one the sheet. on One questions. and my taking for on balance Thanks afternoon. Good

I on broadband the could discussion. first follow-up So just if ARPU

peers. across million we X Last X-Gig When positive broadband tiering and up trajectory X-Gig consistently on fiber in with so You’re out passings. X-Gig tiers, and fiber, the you more drive broadband year, speed have start perhaps benefits broadband adding more you do available nearly your began now a inflection speed rolling see faster to than ARPU?

half to Dennis, XXXX, suggests with year your not it? is of occur the improvement about any maybe about fiber pricing starting until that half commentary guiding on the I next way anything, not but any right maybe think tweaking to back first in the meaningful of earlier the you’re may know

the on cash balance elevated. pressured. remains Free flow sheet. is then leverage Net And

have you strengthen XXXX. can you year know Thank you of of about $XXX think amount how next this and of liquidity. maturities at have some debt point? your position? these the coming the $X.X I expand and But due be I with sheet million at in there and a looking been extending about levers on you’ve might billion What’s comfort levels, proactive balance thinking you’re you. at level overall any to are operating your decent

Dennis Mathew

question. for the Thank Great. you

it under to in sell of Complete QX, starting was feet in more was way. a a still mix. of it and us in talk broadband sell just terms terms single-digits the X-Gig you XX%. about in were in Optimum gig at and Fiber, getting is we’re that meaningful us on From X piece, X, the we ARPU perspective multi-gig XX%, regard. in helping in and On our When at

I we’re just feel And so started. like getting

with teams multi-gig. providing and the of effectively able productivity, in the to to channel value of sell gig most teams our providing understand working to starting and sell value, training, the how terms We’re tools, on improve the performance, yield, the really being helping

about it build and we’re optimistic going look to guidance we’re at to but to we’re momentum, provide as And Marc? to of improvement those going starting some we we’re And specifically very the see not that. continue quarter-over-quarter. the on on elements,

Marc Sirota

that, the sequential add can ARPU, attention we are I to to although broadband implied your do year-over-year turn on I improvements. just Dennis, down

up over saw as quarter our accelerated quarter, we’re ARPU have, the actually So moderated loss in and you here, expansion. $X second first almost we we’ve the ARPU in

outcome some ARPU of the just on that drive the think Dennis I mentioned helping things is a side. So better us

the spot as our debt, of our mentioned like maturities, feel have options address all debt but we we’re to billion to relates around are in now, as $X.X we good Jonathan looking upcoming different very help certainly it Right load. liquidity. As and a vehicles at we asked, I earlier, liquidity to

Kutgun Maral

Thank you great. both. That’s

Dennis Mathew

Yeah.

Operator

Thank you.

is with Our Kraft Bryan Bank. next Deutsche with question from Please proceed question. your

Bryan Kraft

can with other XXXX, returning you Hi. help And leverage I maybe XXXX guess, able you might range? to Marc, business, outlook do I beyond be couple, any visibility aspect XXXX, of all you a and yet XXXX, making have just your had you’ve really the just to period you into more, taking target time that strokes? words, broad the in feel Thanks for to for improve And the mind one for maybe through EBITDA? when question. to in every Marc. stabilize us that progress guys think Thanks. got the CapEx for in been

Marc Sirota

not But EBITDA made, ratios. that’s that Thanks, I unfortunately, specific where but revenue, Bryan. around that. we’re there’s we’ve really focused. we’re exactly still specifically say going very and the customer around give work to targeted optimistic on to And Yeah, and to timelines to going we’re much free or consistent not cash give What beyond be and when focused around is, we’re done going on our targets hit specific returning flow to we’re growth. or we’re capital XXXX will EBITDA on very guidance progress

Bryan Kraft

of next years? Anything on the for directionally, though, couple CapEx

Marc Sirota

Yeah.

mentioned we the update deployment annually. needs our capital we we will will And time. earlier, appropriate at assess you As

Bryan Kraft

Okay. Thank you.

Operator

There this at you. it for to to no company turn further any time. back are would the questions comments. Thank I closing like

Dennis Mathew

a Thank Great. all good you evening. and you. Thank have

Operator

today’s concludes conference. This

your for at time. You participation. lines disconnect this may your Thank you

Altice USA (ATUS) 2 Aug 232023 Q2 Earnings call transcript