Q2 2024 Altice USA Inc Earnings Call

Speaker Change: Hello and welcome to the Altice USA Q2 2024 results conference call and webcast. If anyone should require operator assistance, please press star zero on your telephone keypad. A question and answer session will follow the formal presentation.

Operator: for a results conference call and webcast. If anyone should require operator assistance, please press star zero on your telephone keypad.

Operator: A question and answer session will follow the formal presentation. We ask that you please ask one question and one follow-up, then return to the queue. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Sarah Freedman, Investor Relations. Please go ahead, Sarah.

Speaker Change: You may be placed into question queue at any time by pressing star 1 on your telephone keypad. We ask that you please ask one question and one follow-up, then return to the queue. As a reminder, this conference is being recorded. It is now my pleasure to turn the call over to Sarah Freedman, Investor Relations. Please go ahead, Sarah.

Sarah Freedman: Hello and welcome to Altice USA's Q2 2024 presentation. We are joined today by Altice USA's Chairman and CEO, Dennis Mathew, and CFO, Marc Sirota, who together will take you through the presentation and then be available for questions. As today's presentation may contain forward-looking statements, please carefully review the section titled Forward-Looking Statements on slide 16. Now turning over to Dennis.

Sarah Freedman: Hello and welcome to the Altice USA Q2 2024 earnings call. We are joined today by Altice USA's Chairman and CEO Dennis Mathew and CFO Marc Sirota who together will take you through the presentation and then be available for questions.

Speaker Change: As today's presentation may contain forward-looking statements, please carefully review the section titled Forward-Looking Statements on Slide 2. Now turning over to Dennis to begin.

Dennis Mathew: Thank you, Sarah, and thanks, everyone, for joining today. As you've heard me say before, our mission at Optimum is to be the connectivity provider of choice in every community that we serve.

Dennis Mathew: To do that, we are putting the customer at the center of every decision, providing the best customer experience, best networks, best customer relationships.

Dennis Mathew: and Best Products, all supported by the best team here at Optimum. Our focus on the customer underpins our strategy of returning the business to sustainable subscriber revenue EBITDA and cash flow growth over time.

Dennis Mathew: Q2 was another quarter of progress in our transformation journey.

Dennis Mathew: We continue to deliver improved operational metrics, increased customer satisfaction, growth in our fiber, mobile, and B2B businesses, elevated product quality, and refreshed go-to-market strategy. And we are continuing to use artificial intelligence and data to enhance our capabilities and improve the customer experience. We are executing with financial discipline across every area of the business, and we are just getting started. We have an exciting, innovative, and robust roadmap of future product and experience enhancements that we cannot wait to bring to our current and prospective customers this year and beyond. But before we get into the details, I do want to say thank you.

Dennis Mathew: We continue to deliver improved operational metrics, increased customer satisfaction, growth in our fiber, mobile, and B2B businesses, elevated product quality, and refreshed go-to-market strategies.

Dennis Mathew: And we are continuing to use artificial intelligence and data to enhance our capabilities and improve the customer experience.

Dennis Mathew: We are executing with financial discipline across every area of the business.

Dennis Mathew: And we are just getting started. We have an exciting, innovative, and robust roadmap of future product and experience enhancements that we cannot wait to bring to our current and prospective customers this year and beyond.

Speaker Change: Before we get into the details, I do want to say thank you. Thank you to our customers for choosing us as their provider for one of the most essential services in their lives.

Dennis Mathew: Thank you to our customers for choosing us as their provider for one of the most essential services in their lives. And thank you to our teammates across the country. It is your dedication to our customers that is driving the current and future success of our business. We've invested in people, data, and analytics, and are starting to see returns on those investments. Looking back 12 to 24 months ago, we had a limited understanding of our customers.

Dennis Mathew: And thank you to our teammates across the country. It is your dedication to our customers that is driving the current and future success of our business.

Dennis Mathew: So, now let's turn to slide three to get into some of the specifics.

Dennis Mathew: We delivered $2.2 billion in revenue and $867 million in adjusted EBITDA in Q2 2024.

Dennis Mathew: We've invested in people, data, and analytics and are starting to see returns in those investments.

Dennis Mathew: Through the formation of our centralized data and analytics teams and the implementation of AI tools, we now have a robust understanding of our customers and their individual customer lifetime value. The use of AI tools extends across the business, and we will continue to scale them to transform our operations, drive inbound sales performance, and improve processes at all touch points. On our subscriber trends, we saw impacts from both competitive and macro pressure, which were more pronounced in our west footprint as the east had relatively stable trends. In addition, we saw gross addition pressure in our low-income customer segment, partially attributed to the sunset of ACP and aggressive pricing from ILEX, fiber overbuilders, and FWA.

Dennis Mathew: and are proactively managing these relationships to benefit our customers and our business.

Dennis Mathew: The use of AI tools extends across the business and will continue to scale them to transform our operations, drive inbound sales performance, and improve processes at all touch points.

Dennis Mathew: Our hyper-local strategy, network quality and value, combined with robust offerings across our base, enables us to effectively compete over time.

Dennis Mathew: Overall, we remain well-positioned with a healthy broadband customer base of 4.4 million customers, and we continue to see growth in fiber subscribers and mobile lines, which are key drivers of strong and profitable long-term customer relationships. We also saw positive B2B subscriber growth in Q2, and we are excited to build on this momentum in the second half of the year. Specifically, transactional NPS, or customer satisfaction levels when interacting with Optimum, has grown 34 points over the last two years. Additionally, relationship NPS, or overall customer sentiment toward the Optimum brand, has grown 18 points over the same period.

Dennis Mathew: We also saw positive B2B subscriber growth in Q2, momentum that we are excited to build on in the second half of the year.

Dennis Mathew: Specifically, Transactional NPS, or Customer Satisfaction Levels, when interacting with Optimum, has grown 34 points over the last two years.

Dennis Mathew: Additionally, relationship NPS, or overall customer sentiment toward the optimum brand, has grown 18 points over the same period.

Dennis Mathew: Importantly, our focus on improving NPS scores helps us to enhance profitability while protecting ARPU and sustaining low churn. In Q2, we also saw brand awareness among prospective customers grow by 8 percentage points year-over-year in the East and by 13 percentage points in the West, supported by our customer experience improvements, brand platform launch, and go-to-market strategy. We also continue to see third-party validation. Optimum Fiber was once again recognized for having the fastest and most reliable internet speeds in New York and New Jersey, according to Ookla Speed Test.

Dennis Mathew: In Q2, we also saw brand awareness among prospective customers grow by 8 percentage points year-over-year in the East and by 13 percentage points in the West, supported by our customer experience improvements, brand platform launch, and go-to-market strategies.

Dennis Mathew: We also continue to see third-party validation. Optimum Fiber was once again recognized for having the fastest and most reliable internet speeds in New York and New Jersey, according to Ookla Speed Test.

Dennis Mathew: And most recently, we were named the best internet service provider in the Mid-Atlantic region, inclusive of our New York and New Jersey footprint, by technology publication PCMag. Let's dive into a few key programs that are driving these improved experiences and a positive impact on our brand reputation. Since November, we have upgraded over 700,000 qualified HFC customers to higher speed. Almost half of these customers were previously on legacy lower speed plans.

Dennis Mathew: Let's dive into a few key programs that are driving these improved experiences and a positive impact on our brand reputation.

Dennis Mathew: This initiative enables us to phase out speed tiers, deliver improved service experiences, and leave considerable room for future upgrades. Speed rightsizing demonstrates how we are passing the benefits of our network enhancements directly to our customers. And it is just one component of our overall base management strategy aimed at creating more engaged, satisfied, and stickier customer relationships. We are also increasing customer satisfaction through the broader availability of self-setups or self-installs, creating a better customer experience and reducing truck rolls.

Dennis Mathew: Speed rightsizing demonstrates how we are passing the benefits of our network enhancements directly to our customers, and it is just one component of our overall base management strategy aimed at creating more engaged, satisfied, and stickier customer relationships.

Dennis Mathew: We are also increasing customer satisfaction through the broader availability of self-setups or self-installs.

Dennis Mathew: Creating a Better Customer Experience and Reducing Truck Rolls.

Dennis Mathew: This quarter, we saw a 56% increase in eligible customers choosing self-setup, and we will continue to improve this process. Across our base, we have seen 235,000 fewer truck rolls in the last 12 months, as well as 1.7 million fewer service calls.

Dennis Mathew: This quarter, we saw a 56% increase in eligible customers choosing self-setup, and we will continue to improve this process.

Dennis Mathew: As we deliver better customer experiences, total contact rates per customer have declined by almost 10 percent, and repeat customer service visit rates have declined around 30 percent compared to the prior year. Our completion rates are approaching all-time highs, and our repeat rates are approaching all-time lows. This is driven by our focus on quality. Quality products, quality network, and quality service.

Dennis Mathew: We are resolving product issues faster, driving first-time right on every interaction, expanding self-service tools such as the MyOptimum app, and proactively communicating with our customers like never before, which emphasizes our ability to bring innovative best-in-class technology and products to our customers delivered with the approach and trust of a local business. This platform is backed by our hyper-local go-to-market strategy, which is a town-by- Our hyper-local go-to-market strategy is just gaining momentum, and we are confident that it will enable us to be more competitive in every market we serve.

Dennis Mathew: at a hyper-local level, and we are already seeing the benefits of this tailored approach.

Dennis Mathew: In addition, residential customer wins per losses on competitive switching improved slightly compared to Q2-23 levels.

Dennis Mathew: We are performing better amongst non-movers in the East footprint as well as in the West generally.

Dennis Mathew: Our hyper-local go-to-market strategy is just gaining momentum, and we are confident that it will enable us to be more competitive in every market we serve.

Dennis Mathew: Next, on slide four, I will review some of the exciting developments our teams are diligently working to deliver over the medium term. Let's start with value-added services, a new set of offerings that will bring our customers add-ons to help get them the most out of their experience with Optimum, while expanding our opportunity to capture additional revenue per customer beyond our core products. We recently launched Total Care, which provides premium support for customer services and connected devices in the home for $15 per month for residential customers.

Dennis Mathew: Next, on slide four, I will review some of the exciting developments our teams are diligently working to deliver over the medium term.

Dennis Mathew: With our operational transformation well underway, we are excited about the upcoming evolution of the Optimum Product and Solutions portfolio, which focuses on driving innovation, flexibility, and value for our customers.

Dennis Mathew: Let's start with value-added services, a new set of offerings that will bring our customers add-ons to help get them the most out of their experience with Optimum, while expanding our opportunity to capture additional revenue per customer beyond our core products.

Dennis Mathew: We recently launched Total Care, which provides premium support for customer services and connected devices in the home at $15 per month for residential customers.

Dennis Mathew: Since the product's soft launch in Q2, we've seen several thousand customers take this add-on, and marketing hasn't even started. We also offer device protection for our fixed services and have just recently launched device protection for mobile. As consumer needs evolve, we are also exploring partnerships with third-party OTT app providers to resell services as part of the Optimum product suite. This is an untapped area for us, enabling us to meet changing customer behaviors while creating greater financial flexibility in managing content.

Dennis Mathew: Since the product's soft launch in Q2, we've seen several thousand customers take this add-on, and marketing hasn't even started.

Dennis Mathew: We also offer device protection for our fixed services and just recently launched device protection for mobile.

Dennis Mathew: On broadband, both our fiber and HFC footprints continue to be recognized for speed and reliability, coming in ahead of our peers in several key categories. In areas where we have fiber, we are focused on growing penetration through both customer additions and a renewed focus on migrations, a process that is now faster, easier, and more cost effective. We anticipate accelerating fiber migrations in the second half of the year.

Dennis Mathew: On broadband, both our fiber and HFC footprints continue to be recognized for speed and reliability, coming in ahead of our peers in several key categories.

Dennis Mathew: Performance on our HFC network continues to improve, as well, as we make the right investments to provide best-in-class speeds, reliability, and a durable network lifecycle. Today, we have one gigabit or higher speeds available to 95% of our total footprint. We are actively testing our ability to deliver two gigabit speeds using mid and high split technology and reclaiming capacity from our video system as we expand our Optimum Stream product.

Dennis Mathew: Today we have one gig or higher speeds available to 95% of our total footprint. We are actively testing our ability to deliver two gig speeds using mid and high split technology.

Dennis Mathew: and our reclaiming capacity from our video system as we expand our Optimum Stream product.

Dennis Mathew: Next, we'll continue our speed rightsizing program as part of our broader base management strategy, identifying and upgrading qualified customers on an ongoing basis. And we're continuously enhancing our in-home Wi-Fi experience with software and hardware improvements to expand coverage and optimize performance. Our roadmap includes wireless backup, smart Wi-Fi solutions, and next-generation gateways. On mobile, we'll continue to extend mobile sales to more channels, and we'll expand our mobile device selection. We added tablets and mobile device protection to our portfolio in Q2 and expect to introduce wearables next year.

Dennis Mathew: Next, we'll continue our speed rightsizing program as part of our broader base management strategy, identifying and upgrading qualified customers on an ongoing basis.

Dennis Mathew: On mobile, we'll continue to extend mobile sales to more channels and we'll expand our mobile device selection.

Dennis Mathew: We added tablets and mobile device protection to our portfolio in Q2 and expect to introduce wearables next year. And we recently started selling mobile in B2B, which will support future growth.

Dennis Mathew: And we recently started selling mobile in B2B, which will support future growth. In B2B, we are beginning to see more traction, reporting positive SMB broadband net additions in the quarter. And we have plans to add more managed services, such as SD-WAN, Network as a Service, LTE backup, and richer security features in the coming months.

Dennis Mathew: On B2B, we are beginning to see more traction.

Dennis Mathew: reporting positive SMB broadband net additions in the quarter and we have plans to add more managed services such as SD-WAN, Network-as-a-Service, LTE backup and richer security features in the coming months.

Dennis Mathew: In addition, our LightPath Enterprise business continued to see healthy revenue growth in Q2 driven by an increase in net installs. Light's path continues to expand its footprint through the Tuckin Acquisition. In June, LightPath announced that it had entered into an agreement to acquire United Fiber and Data. UFD owns and operates high-fiber count networks between New York City and Ashburn, Virginia. And last, a moment on video turning to slide five.

Speaker Change: In June , LightPath announced that it had entered into an agreement to acquire United Fiber and Data.

Speaker Change: Over the last few years, we have learned a lot about our customers' TV viewing habits and have been preparing as a company to address these changes.

Dennis Mathew: First, we launched OptimumStream, our Android-based streaming video platform, and we continue to enhance its functionality. We plan to introduce pause and rewind for live TV and a new user interface in the months to come. Optimum Stream is available to all our New York Tri-State Area customers, and this year, we expect to bring our premier video service to nearly 1.5 million more homes across our West footprint. In July, we announced the launch of Entertainment TV, a new Internet TV package and the first of several new video bundles to be rolled out by Optimum with a variety of content options. This TV package is priced at $30 per month and features over 80 top-rated channels, available both live and on-demand, through Optimum Stream.

Dennis Mathew: First, we launched Optimum Stream, our Android-based streaming video platform, and we continue to enhance its functionality. We plan to introduce pause and rewind for live TV and a new user interface in the months to come.

Speaker Change: Optimum Stream is available to all our New York tri-state area customers and this year we expect to bring our premier video service to nearly 1.5 million more homes across our West footprint.

Speaker Change: In July , we announced the launch of Entertainment TV, a new Internet TV package, and the first of several new video bundles to be rolled out by Optimum with a variety of content options.

Dennis Mathew: This TV package is priced at $30 per month and features over 80 top-rated channels, available both live and on-demand, only through Optimum Stream.

Dennis Mathew: Entertainment TV customers also have access to Optimum's News 12 service, the preeminent hyper-local news source across the New York tri-state area. Entertainment TV is coming at a time when we continue to see the landscape of sports and TV content changing dramatically. Roughly one in five of our video customers do not engage with broadcast, cable news, sports, or premium channels regularly, and we are now able to provide these customers with optionality. Consumers should have the choice to pay fair and reasonable prices for the content they want and how they want it, without being forced to pay for what they don't want.

Dennis Mathew: Entertainment TV customers also have access to Optimum's News 12 service, the preeminent hyper-local news source across the New York tri-state area.

Dennis Mathew: Entertainment TV is coming at a time when we continue to see the landscape of sports and TV content changing dramatically.

Dennis Mathew: Additionally, programmers continue to mandate bundles and raise prices for all customers, regardless of whether they watch the content, while also moving premium content to direct-to-consumer platforms without giving equal access to linear partners who pay a majority of their costs.

Dennis Mathew: Consumers should have the choice to pay fair and reasonable prices for the content they want and how they want it without being forced to pay for what they don't want.

Dennis Mathew: Therefore, we will approach every renewal discussion with the customer at the forefront, and we will collaborate with partners who are committed to providing flexibility, choice, and value for our customers. As we look ahead to the rest of this year and beyond, we have a lot of exciting innovations and opportunities to continue to evolve the optimum business model. We are confident that our strategy is positioning us well and will lead to long-term customer revenue and cash flow growth. With that, I'll now hand it over to Marc to review our Q2 performance and give more details. Thank you, Dennis. Turning to slide seven.

Speaker Change: Therefore, we will approach every renewal discussion with the customer at the forefront, and we will collaborate with partners who are committed to providing flexibility, choice, and value for our customers.

Dennis Mathew: As we look ahead to the rest of this year and beyond, we have a lot of exciting innovations and opportunities to continue to evolve the optimum business.

Dennis Mathew: We are confident that our strategy is positioning us well and will lead to long-term customer, revenue, and cash flow growth.

Dennis Mathew: With that, I'll now hand it over to Marc to review our Q2 performance in more detail.

Marc Sirota: Total revenue was $2.2 billion in Q2, and declined 3.6% year-over-year. However, a notable improvement from Q2 2023, which was down 5.6. Residential revenue declined 4.4% in Europe, driven by a smaller customer base and continued losses. Despite this volume pressure, the 4.4% decline is a marked improvement. Q2 2023, are down 5.7% year-over-year, of note within our Residential Revenue. As we continue to ramp up on mobile, this should contribute to more of our residential revenue trends over time, especially among our low-income families.

Mark: Thank you, Dennis. Turning to slide 7.

Mark: Residential revenue declined 4.4% year-over-year, driven by a smaller customer base and continued losses of video subscribers.

Mark: Despite this volume pressure, the 4.4% decline is a marked improvement from the Q2 2023 trend of down 5.7% year-over-year.

Mark: As we continue to ramp up on mobile, this should contribute to more of our residential revenue trends over time.

Marc Sirota: Although we have improved our channel conversion rate, the top of the funnel opportunities are lower due to increased competition in recent quarters and a challenging macroeconomic environment. However, the current market dynamics are limiting our ability to grow subscribers and, consequently, top-line growth in the near term. Over the long term, we are confident that our superior network, product suite, and customer experience will outperform both fixed wireless and fiber. We expect this competitive advantage will enable Optimum to achieve sustained growth over time.

Mark: Although we have improved our channel conversion rates.

Mark: Despite these challenges, we see underlying strength and stable churn, stable ARPU, and growing customer satisfaction.

Mark: However, the current market dynamics are limiting our ability to grow subscribers and, consequently, top-line growth in the near term.

Mark: Over the long term, we are confident that our superior network, product suite, and customer experience will outperform both fixed wireless and fiber overbuilders.

Mark: We expect this competitive advantage will enable Optimum to achieve sustained growth over time.

Marc Sirota: In business services, we grew revenue 1.3%, which was driven by growth in our LightPath Enterprise business, and we continue to grow customer relationships, selling ancillary services to our base. News and advertising revenue declined 7.2% in the quarter, primarily tied to non-recurring prior year one-time events.

Mark: In business services, we grew revenue 1.3%, which was driven by growth in our Light Path Enterprise business.

Mark: News and advertising revenue declined 7.2% in the quarter, primarily tied to non-recurring prior year one-time items.

Marc Sirota: We expect political revenue to become more of a tailwind in the second half of this year and anticipate double-digit full-year growth. Q2, despite pressures on our video..., continued to maintain a relatively stable and healthy residential ARPU of $135.95, and this has proven to be the case, with already low churn. You've been able to keep churn near all-time lows and have maintained better rates per customer and retail. In addition to sales and retention, we are now introducing our AI tools for use by our carriers. This enhances efficiency and provides us with the insights needed to swiftly resolve issues and suggest offers and actions. Turning to slide 8.

Mark: We expect political revenue to become more of a tailwind in the second half of this year and anticipate double-digit full-year growth.

Mark: In Q2, despite pressures on our video base, we continue to maintain a relatively stable and healthy residential ARPU of $135.95.

Mark: Recall when we began implementing new rate card pricing for cohorts across our base at the beginning of this year. We signaled that this would not impact residential ARPU and this has proven to be the case.

Mark: This trend is tied to continued selling of incremental services like mobile and fiber.

Mark: as well as enhancements in our base management and discipline around rate erosion. Notably, all of our operational improvements we have made in the last few quarters are translating into higher customer satisfaction, as Dennis mentioned.

Dennis Mathew: With already low churn rates, we've been able to keep churn near all-time lows and have maintained better rates per customer retention through tailored offers at the customer level using new advanced AI, data, and tools.

Dennis Mathew: In addition to sales and retention, we are now introducing our AI tools for use by our care agents, consolidating dozens of legacy capabilities into one user-friendly interface.

Dennis Mathew: This enhances efficiency and equips our team with the insights needed to swiftly resolve issues and suggest offers and actions tailored to each customer based on the specific reason for contacting us.

Marc Sirota: Total adjusted EBITDA declined 5.9% in Q2 year over year, a marked improvement from the trend of Q2 last year, which was down 8.5%. Adjusted EBITDA margins were 38.7% in Q2, which was just down under one percentage point from the prior. The Jussie D. Bedard decline was primarily the result of low single-digit revenue declines and elevated sales and marketing and transformation expenses, and we have maintained stable operating. As we continue on our journey of improving operations, bringing the best-in-class talent and rolling out advanced tools, our overall costs have remained.

Dennis Mathew: Turning to slide 8.

Speaker Change: Total adjusted EBITDA declined 5.9% in Q2 year over year, a marked improvement from the trend of Q2 last year, which was down 8.5%.

Dennis Mathew: Adjusted EBITDA margins were 38.7% in Q2 which was just down under one percentage point from the prior year.

Dennis Mathew: Adjusted EBITDA decline was primarily the result of low single-digit revenue declines and elevated sales of marketing and transformation expenses in the quarter.

Marc Sirota: We have achieved savings in some areas of the business through operational and process management. This efficiency allows us to reinvest in other areas, such as data analytics, and Sales and Marketing, which are expected to drive positive subscriber growth and top-line results over time. Q2 free cash flow was negative $41 million, which includes $57 million of higher cash taxes compared to the prior year quarter due to the timing of the first half estimated.

Dennis Mathew: This efficiency allows us to reinvest in other areas, such as data analytics and sales and marketing, which are expected to drive positive subscriber growth and top-line results over time.

Marc Sirota: We anticipate cash taxes will be significantly lower in the second half of the year, and we expect full-year cash taxes to be in the range of $250,000 million to $300 million, and we continue to target positive free cash. Next, on slide nine, we'll review our subscriber. We added 40,000 Fiverr customers in the quarter, on pace with the prior year quarter, and grew Fiverr customer acquisition to over 15%. Additionally, approximately 60% of our FiberNet ads were from migrations of existing customers.

Dennis Mathew: Next, on slide 9, we'll review our subscriber trends.

Speaker Change: We added 40,000 Fiverr customers in the quarter, on pace with the prior year quarter, and grew Fiverr customer apprenticiation to over 15%, representing growth of 1.1 percentage points in the quarter.

Dennis Mathew: Approximately 60% of our FiberNet ads were from migrations of existing customers.

Marc Sirota: If you recall, we mentioned there would be a bit of a slowdown in the pace of migrations this quarter as we continue to refine the operational process, and we increased the penetration of our broadband base to 5.8%. We have a lot of runway to continue to grow the mobile attachment rate and penetration to create stickier customers. We anticipate accelerating mobile growth in the second half of the year through sales productivity and exciting new offers. Total broadband subscriber net losses were 51,000 in the first half of the year, driven by seasonal university disconnects, continued competitive and macro pressures, and the impact of ACP.

Dennis Mathew: If you recall, we mentioned there would be a bit of a slowdown in the pace of migrations this quarter as we continue to refine the operational process. And I am pleased we expect to accelerate migrations in the back half of the year.

Dennis Mathew: We have a lot of runway to continue to grow the mobile attachment rate and penetration to create stickier customers.

Dennis Mathew: Total broadband subscriber net losses were 51,000 in the quarter, driven by seasonal university disconnects, continued competitive and macro pressures, and the impact of ACP sunsetting.

Marc Sirota: Specifically, the difference in Q2 Broadband Net Add performance versus the prior year can mainly be attributed to pressure in our low-income... Contributing to this is the sunset of ACP, which has temporarily impacted both gross ads and disconnects in this segment year over year. We continue to manage these customers with tailored offers, repackaging them into best value products and services that fit their connectivity needs and prices, from low income offerings for qualified customers to adding mobile to save more on their bills plus add-ons.

Dennis Mathew: from low-income offerings for qualified customers to adding mobile to save more on their bills plus added discounts.

Marc Sirota: As Dennis mentioned earlier, we have seen green shoots throughout our hyper-local go-to-market efforts, and these efforts are just starting, side from our low-income customers, to see improved gross ad activity year over year. Further, in July, we saw stabilizing broadband subscriber trends compared to the prior year of July. We continue to see pressure from the low-income segment.

Dennis Mathew: As Dennis mentioned earlier, we have seen green shoots throughout our hyper-local go-to-market efforts, and these efforts are just starting to take form.

Dennis Mathew: Aside from our low-income segment, we see improved gross ad activity year over year.

Dennis Mathew: Further, in July , we see stabilizing broadband subscriber returns compared to the prior year, July .

Marc Sirota: We are pleased with the underlying stabilization of the business, which gives us confidence that we are well-positioned to return to long-term profitability. Overall, as we continue to enhance our base management strategies, such as improving customer communication and speed right, we have the opportunity to deepen our customer relationships and maximize CLV by retaining long-tenured customers and selling additional products. We have a strong base of broadband customers, the majority of whom have been with us for five years, take multiple products, and churn less compared to early-tenured customers. Turning to slide 10, we will review our capital expenditures and network. Cash capital expenditures were $348 million, which is down 27% year-over-year in QI.

Dennis Mathew: Overall, as we continue to enhance our base management strategies, such as improved customer communication and speed right sizing, we have the opportunity to deepen our customer relationships and maximize CLV by retaining long-tenured customers and selling additional products.

Dennis Mathew: We have a strong base of broadband customers, the majority of whom have been with us for five years or more, take multiple products and churn less compared to early tenured customers.

Dennis Mathew: Turning to slide 10, we will review our capital expenditures and network investments.

Dennis Mathew: Cash capital expenditures were $348 million.

Marc Sirota: In capital intensity, our cash CapEx as a percentage of total revenue in a quarter was $15.5 billion, down about five percentage points versus Q2 last year. Recall that in 2023, our capital expenditure was weighted more toward the first half. Therefore, we are comparing to higher CapEx. In Q2 2024, we added 62,000 additional fiber, and we expect to end the year with around 3 million fibers. Additionally, we expanded our total passing footprint by 67,000 in the quarter, and we expect to add over 175,000 total passes this year.

Dennis Mathew: Additionally, we expanded our total passing footprint by 67,000 in the quarter and we expect to add over 175,000 total passings this year.

Marc Sirota: As Dennis mentioned, our HFC plant continues to perform well, and we are maximizing this network. For example, we are increasing broadband capacity for over 2.5 million customers by allocating bandwidth more efficiently to improve both upload and download speeds, and continue to split nodes to create more capacity on our network. And we are doing this at a lower cost, with enhanced processes and tools to identify six network and equipment issues that a customer would ever know.

Dennis Mathew: We continue to split nodes to create more capacity on our network and we are doing this at a lower cost.

Marc Sirota: All of these enhancements regarding, validation that we are making the right investments to strengthen our, We remain focused on network enhancements with capital efficiency, prioritize the highest returns and benefits to our customers, all remaining disciplined around capital. As we have remained disciplined in the first half of this, We now anticipate full-year CapEx to come under $1.6 billion, slightly lower than the range of our initial guide. 0.5%.

Dennis Mathew: All of these enhancements regarding recognition from improved customer experience to third-party published awards and improved Google review scores.

Dennis Mathew: Please note, we expect capital intensity to increase slowly in the back half of this year as we migrate more customers to fiber and continue to invest in our network.

Dennis Mathew: And finally, on slide 11, I would like to review our debt maturity profile.

Dennis Mathew: We are well positioned with a clear runway of maturities until 2027.

Dennis Mathew: At the end of Q2, our weighted average cost of debt is 6.5% and our weighted average life is 4.6 years. 80.5% of our total debt stack is fixed, inclusive of floating to fixed interest rate swaps.

Operator: 80.5% of our total debt stack is fixed, and our leverage ratio is 7.2 times the last two quarters' annualized adjusted EBITDA. We will continue to be proactive in managing our debt maturities and evaluate how to best ensure that our capital structure. Sports is a long-term operating business, and while we are well positioned in the near term, we are looking at all options to maintain our capital structure. In conclusion, we have the right strategy in place, all of which positions us on a path to sustainable long-term growth.

Speaker Change: financial discipline and enhancing the customer experience with a segmented go to market approach, all of which positions us on a path to sustainable long-term growth.

Operator: With that, we will now take any questions. As a reminder, we ask you to please ask one question and one follow-up, then return to the queue. If you'd like to be placed in the question queue, please press star 1 on your telephone keypad.

Speaker Change: Thank you. We will now be conducting a question and answer session.

Operator: You may press star 2 if you'd like to remove your question from the... Our first question today is coming from Frank Louthan from Raymond James. Your line is now live. Great, thank you.

Speaker Change: You may press star 2 if you'd like to remove your question from the queue. One moment please while we poll for questions.

Dennis Mathew: Can you give us an idea of the current run rate savings from the truck rolls and the call center inbounds? And then, as a follow-up, where do you think you are as far as integrating AI into your business for efficiencies and so forth? Kind of give us a sense of what inning you're in or something like that?

Dennis Mathew: Thank you. Hey Frank, we're really excited about the improvements that we're seeing in our operations. As I mentioned, 1.7 million fewer calls, 235,000 fewer truck rolls, and there's more opportunity. We're leaning into self-install, and we're leaning into just more proactively communicating with our customers. 56% increase in self-install this past quarter, and we're sending messages proactively when folks are having outages or service interruptions, service visits, or installs, and this is all driving savings, this is all driving fewer calls, fewer truck rolls, just less noise in the system, and that's translating into an improved customer experience.

Speaker Change: service visits, installs, and this is all driving savings, this is all driving fewer calls, fewer truck rolls, just less noise in the system, and that's translating into improved customer experience.

Dennis Mathew: We are taking those savings and optimizing our OPEX structure, and I'll let Marc talk about that a bit in a second. But then we're investing as well, and we're being disciplined about that investment. We talked a bit about AI, and our first step in that direction was launching a tool in our retention queues to help our agents more effectively manage call volumes coming in based on the customer's lifetime value, the product set, and really provide them with offers that are custom to their needs. And it also takes into consideration the competitive intensity in the market so that it's not a one-size-fits-all when we're taking those calls.

Speaker Change: in the market so that it's not a one-size-fits-all when we're taking those calls. And that is allowing us to have...

Dennis Mathew: And that is allowing us to drive better save rates and drive improvements in ARPU erosion. And so we're continuing on this journey. We're running pilots in our care centers.

Speaker Change: drive better save rates and drive improvements in ARPU erosion. And so we're continuing on this journey. We're running pilots.

Marc Sirota: We're running pilots with our field teams, and we're seeing real opportunities to just help us elevate our customer experience, make it simpler for our employees to have easier tools, find the solutions faster, solve the issues faster, to ultimately deliver a more effective experience and drive even further efficiency as we go into the second half of the year and into 25. Yeah, Frank, I would just add that in our OPEX costs, we've been able to make these investments that Dennis has mentioned and keep our operational costs flat.

Speaker Change: deliver a more effective experience and drive even further efficiency as we go into the second half of the year and into 25.

Marc: Marc? Yeah, Frank, I would just add, you see in our OPEX costs, we've been able to make these investments that Dennis has mentioned and keep our operational costs

Marc Sirota: We were down sequentially quarter over quarter, which we were pleased about. And so, while we drive out the truck rolls and the phone calls, we're able to reinvest in this type of technology. I would characterize it, Frank, as early innings with AI.

Marc Sirota: We, as Dennis mentioned, have it in front of all of our retention agents to date. By the end of the third quarter, we'll have it in front of all of our care agents. Again, tailored actions at the individual customer level. So, really excited about where AI is going to take this company. It's really helping us guide the operations. And you see it in the stable ARPU.

Dennis Mathew: Despite the video pressures that we see, we're able to maintain our video ARPU. So, really pleased with our progress, but still early in it. All right, great. Thank you very much. Thanks, Kutgun. I'll take the second question first, and then I'll throw it over to Marc.

Speaker Change: All right. Great.

Speaker Change: I know the focus for the management team and the board has perhaps shifted over the years more towards improving underlying operations of the business as opposed to asset modernization. But given legacy optimum is in the top BMA with meaningful progress on the fiber build,

Speaker Change: Are you now at a point where maybe there's any interest or willingness to engage in monetizing it in some capacity?

Dennis Mathew: But we are continuing to be laser focused on transforming this organization, and we're really excited about the progress that we're making. And the legacy cable vision, or the East footprint, is one that we're laser focused on. You know, we launched our new hyperlocal go-to-market playbooks in the past quarter, and we are seeing incredible stabilization across our footprint in over 100 of the markets that we've launched, which includes the East. And we're seeing improved performance, particularly in our fiber footprint and particularly where we overlap with Verizon. We are seeing our ability to compete improve, and we're going to continue to lean into that. We're still in the early innings.

Speaker Change: to be laser focused on transforming this organization and we're really excited about the progress that we're making.

Speaker Change: and the legacy Cablevision or the East Footprint is one that we're laser focused on. You know, we've launched our new hyper-local go-to-market playbooks in the past quarter and we are seeing incredible stabilization across our footprint.

Speaker Change: And we're seeing improved performance, particularly in our fiber footprint and particularly where we overlap with Verizon. We are seeing our ability to compete improve and we're going to continue to lean into that.

Dennis Mathew: You know, I'm really proud of what the team has accomplished. We have won award after award by third-party independent organizations. As I mentioned, Ookla named us the fastest and most reliable in New York and in New Jersey in that DMA that you're discussing. PCMag named us the top ISP in the Mid-Atlantic, which includes New York and New Jersey.

Marc Sirota: But there's more work to do, and we know that the competitive pressures continue to ramp up. But we have the products, we have the service, we have the tools to compete effectively in the East, and we want to continue to drive improvements and continue to accelerate our transformation. So that's what we're focused on today. Mark, you want to talk about the EBITDA piece? Yeah, Kagan.

Speaker Change: But there's more work to do and we know that the competitive pressures

Speaker Change: to compete effectively in the East, and we want to continue to drive improvements and continue to accelerate our transformation.

Marc Sirota: On a full-year basis, we expect our year-over-year EBITDA declines to moderate versus the prior year. This is really driven by all the operational improvements that we've talked about that we've made over the past year. This includes all the investments we made in our customers, such as speeding rights dodging activities, all the investments in our network, and you see that really transforming our truck roles and our service calls, which we just talked about. And then I just really pleased with the stabilization of ARPU.

Speaker Change: This is really driven by all the operational improvements that we've talked about that we've made over the past year. This includes

Speaker Change: All the investments we made in our customers, such as the speed rights dodging activities, all the investments in our network,

Speaker Change: transforming our truck roles and our service calls which we just talked about and then

Marc Sirota: And we do see a path for growth there. And again, that's mainly tied to discipline and the use of AI to drive each conversation with our customers. So it's these investments that give us confidence that we will drive EBITDA improvements this year and then in the long term. And that's really what we're focused on, long-term sustainable EBITDA growth.

Speaker Change: Just really pleased on the stabilization of ARPU.

Speaker Change: And we do see a path for growth there.

Speaker Change: And again, that's mainly tied to discipline and use of AI to drive each conversation with our customers.

Marc Sirota: And so, yeah, that's where we feel things are heading, and we feel good about it. Thank you. The next question is coming from Michael Rollins from Citibank. Your line is now live. Good morning.

Speaker Change: And so, yeah, that's where we feel things are heading and feel good about it.

Speaker Change: Perfect. Thank you both. Thank you.

Operator: I'm just curious if you can provide more specifics on how ACP impacted broadband performance in the second quarter and your expectations for how it may specifically impact performance in the second half. And then, just taking a step back, can you share where you are today on the percent of the broadband base that now has that simplified rate card and the timing to get to the rest of the customers? Thanks.

Speaker Change: Thanks and good morning. I'm just curious if you can provide more specifics on how ACP impacted broadband performance in the second quarter.

Speaker Change: and your expectations for how it may specifically impact the performance in the second half.

Dennis Mathew: Thanks, Michael. On ACP, as Marc mentioned just broadly, as we look at the low-income segment, we did see a bit of a slowdown and some headwinds as it relates to that segment in particular, both from a growth and from a disconnect perspective. In ACP specifically, we're really happy with our performance. We saw a very nominal increased churn from our baseline, and I think that's really attributable, again, to the incredible work the team did to prepare and to be able to offer our customers options.

Dennis Mathew: We leveraged our tools and leveraged offers and packages to help right-size people in terms of their needs, getting them into packages that right-size their speeds, right-size their package with Optimum Mobile, and really making sure that they had the right products that they needed. So, incredible performance on the disconnect side, but we have seen that subsidy and just generally a bit of a slowdown in terms of gross ads. And when I look at our general performance, that is where I see our headwinds that occurred in the second quarter.

Speaker Change: and in terms of their needs, getting them into packages.

Speaker Change: that right-sized their speeds, right-sized their package with Optimum Mobile.

Dennis Mathew: But we feel that we do have the right products and the right services to compete long-term. We have incredible value. Our focus remains quality and value, and when we look at value and we look at optimum complete, we now have optimum stream that is launching across the footprint. Entertainment TV is an incredible value.

Speaker Change: But we feel that we do have the right products and the right services to compete long-term.

Speaker Change: We have incredible value. Our focus remains quality and value, and when we look at value and we look at optimum, complete, we now have optimum.

Speaker Change: stream that is launching across the footprint. Entertainment TV is an incredible value. As I mentioned, a new video package. We believe that long term we do have now the right products and the capabilities to be able to compete across every

Dennis Mathew: As I mentioned, the new video package, we believe that long-term we do now have the right products and the capabilities to be able to compete across every segment. In terms of our broadband retail pricing, I'll throw that over to Mark to just provide a little bit more color. Yeah, Michael, we're pleased with the overall ARPU trajectory and the stabilization that we've talked about. From a rate card perspective, all of our fiber rate cards are now fixed and reset, and then we will, over time, and this will be a multi-year journey, set the HFC rate card.

Speaker Change: segment.

Marc: In terms of our broadband retail pricing, I'll throw that over to Marc to just provide a little bit more color.

Marc: is now fixed and reset, and then we'll, over time, and this will be a multi-year journey, we will set the HSC rate card, so still fairly early days on that side of the house.

Marc Sirota: So still fairly early days on that side of the house. Again, we did not see any material impact from the change here, and we'll continue to manage ARPU on an individual customer basis and feel that there's a path to real growth as we continue to accelerate selling in more products like fiber, like mobile, and other ancillaries. Yeah, I'll just continue to reiterate that our philosophy or strategy around our pricing strategy has been providing transparency, predictability, and just eliminating a bit of the confusion that existed with the old rate cards and promo roll strategy. And we're seeing real benefits from that.

Marc: and feel that there's a path for real growth as we continue to accelerate selling in more products like fiber, like mobile, and other ancillary services.

Marc: and just eliminating a bit of the confusion that existed with the old rate cards and promo roll strategy and we're seeing real benefits from that. We're seeing that we're able to continue to implement that strategy and provide the clarity that our customers are looking for.

Speaker Change: Thank you.

Dennis Mathew: We're seeing that we're able to continue to implement that strategy and provide the clarity that our customers are looking for. Thank you. Thank you. The next question today is coming from Craig Moffett from Moffett & Atkinson. Your line is now live. Marc, anything you'd like to add?

Marc: Thank you.

Speaker Change: Hi, good morning.

Speaker Change: You know, we were really, prior to me joining and launching these playbooks, we were really struggling as fiber overbuilders came into our footprint.

Speaker Change: The impact that those folks were having was fairly outsized in terms of

Marc: And I'll let Marc add a bit of color across these tactics. We are seeing improvements in churns. Fifty percent of those folks...

Marc: And we're seeing a level of loyalty and stickiness.

Marc: tied to that improvement. Similarly for those customers that are taking mobile.

Marc: And so now our job is to continue to drive that go-to-market in a more meaningful way across every town, across every market.

Marc Sirota: Yeah, just around speed, right sizing, and fiber, in particular, we're seeing that these tactics are working. We see double-digit churn improvements coming out of customers that take their fiber product or speed right size. And again, as Dennis mentioned, we do see acceleration in our non-low income segments around gross ad performance. And so that gives us optimism around where the business is from a core basis, coupled with the investments we've made in customer experience.

Marc: Yes, the other piece that we're leaning into as I mentioned was the is the value added services, where we have an opportunity a real opportunity to further.

Marc Sirota: Yeah, and the other piece that we're leaning into, as I mentioned, is value-added services, where we have an opportunity, a real opportunity, to further drive services into the base. We launched our new total care solution, and within a few weeks, without any marketing, we've already added several thousand customers.

Speaker Change: Drive services into the base, we launched our new total care solution.

Dennis Mathew: And so, just having a much more proactive, strategic base management strategy, as we launch these new services and sell them into the base, we believe that that will further accelerate our transformation. Thanks, Craig. I think if I could just maybe ask a quick follow-up to Mike's question earlier, just, you know, thinking about the second quarter, you talked about, you know, the majority of the decline, right, and could be attributed to the low income segment, but help us perhaps think about, you know, in light of that, you talked about June, there was some stabilization there.

Dennis Mathew: As we think about the ACP impact, you know, thinking about what your peers have messaged in terms of the non-pay disconnect as well, pressure coming through. Would the expectation be, you know, considering June was, quote-unquote, stable on a year-on-year basis, do you expect to see additional non-pay disconnects? I mean, should we be thinking about the third quarter of 2024 looking something like 2023 in terms of losses, whereas perhaps maybe non-pay disconnect pressure from an ACP could be offset by some of the base management other strategies you just kind of articulated?

Operator: Just trying to get a better sense of how we should think about the impact flowing through because messaging, you know, from peers and competitors has been, you know, there's probably still, you know, more to come in the back half of the year in terms of ACP headlines. Yeah, as we said, go ahead, now go ahead. Oh, yeah, you know, in our fiber performance, we had 60% migrations. We had an all-time high in Q1.

Marc: Flowing through because messaging.

Speaker Change: From peers and competitors have been you know, there's probably still more to come in the back half of the year in terms of AP ACP headwinds.

Sebastiano: Yeah Sebastiano.

Sebastiano: The comment on stabilization was in July.

Marc: We are seeing stabilization in July and we.

Sebastiano: <unk> further stabilization in the second half of the year, we launched our new <unk>.

Sebastiano: Local hyper local playbooks in the second quarter, and we do believe that theyre going to continue to provide us meaningful.

Sebastiano: Acceleration as we look at implementing them town by town offers at the talent level and having marketing tactics at the talent level and being able to compete more effectively head on with these fiber overbuild or as in fixed wireless.

Sebastiano: We're still in the early innings and we're seeing some benefit.

Sebastiano: We started to see some of those benefits, particularly in stabilizing churn and now it is helping us compete more effectively from an acquisition perspective, but I'll throw it over to mark to add any color he'd like on ACP and the low income segment.

Mark: In addition to some of the conversations we've already had this morning.

Mark: We're launching AI tools within our nonpaying Simon as well.

Operator: And that really helped us understand some of the challenges that we were dealing with, in terms of operational and technical issues tied to the migrations. As I had mentioned in earlier calls, we purposely took a little bit of a slowdown so that we could solve those technical issues. And I'm pleased to report that those technical issues have been solved.

Dennis Mathew: And so our goal is to integrate this now into all of our channels to drive a much more meaningful pace of migration in the second half of the year. Now that we have a much more seamless process to migrate customers, we're integrating strategies and tactics into our care channels, into our retail centers, into our retention channels. You know, every time we have an opportunity to interact with our customers, we will now be able to confidently present them with a migration option and get them into the best products. We also feel very comfortable now that we have the right video solutions to pair along with our broadband fiber product.

Dennis Mathew: As I mentioned, we've launched Dream across the entire tri-state. That was also a critical element of being able to accelerate. As you know, in the East footprint, we do have customers that take both broadband and video and have broadband and video. And so we needed to make sure we had a full solution set that we could confidently present to our existing customers. And we do have that now.

Dennis Mathew: And so our pace will accelerate. The goal is to accelerate our pace meaningfully in the second half. Thank you. Thank you. Our next question today is coming from Mary Ann Zhao from Morgan Stanley. Your line is now live. Mary Ann, perhaps your phone is on mute. Thank you. I've got two questions.

Operator: One on advertising, the second quarter was disappointing, down 7%, but you sound super optimistic about the second half. Can you give us some color on expectations if you can parse out political, which clearly should be strong versus what you're seeing in the underlying advertising market? And then secondly, it didn't really come up on the call, but you are overbuilding a couple of markets. Can you give us an update on that? You're seeing both in your efforts to overbuild and then others who are also coming into your markets what you're seeing.

Speaker Change: Political will.

Speaker Change: And then secondly, it didn't really come up on the call, but you are overbuilding couple of markets can you.

Speaker Change: Give us an update on what what.

Speaker Change: You're seeing on both in your efforts to Overbuild and then others, who are also coming into your markets, but what are you seeing.

Mark: Hey, Jessica I'll I'll cover the Overbuilding, and then I'll throw it over to Mark to talk about the advertising trends we.

Mark: We are.

Mark: Building out in New Jersey in Montclair, and West Orange and we're on track.

Mark: To launch later in Q3.

Mark: We have when we look at that opportunity in particular, we look at the overall return on investment and we.

Mark: Look at the cost in.

Mark: Given our footprint it was an opportunity for us to continue to build out our plant and offer incredible are incredible fiber network and fiber product.

Mark: Two of these customers and in these towns in a cost effective way, which we're excited about we will be launching broadband and mobile and the full product portfolio.

Mark: We have teams and go to market strategies ready and the teams are actively working to prepare us for launch later in the quarter.

Mark: We're continuing to see overbuild activities and build activities throughout the footprint and we know that the competitive intensity is only going to continue to increase and that's why we have to control what we can control.

Mark: Looking at how we want to deploy capital in the most cost and the most effective way to provide the <unk>.

Mark: Most meaningful return on investment when we look at our opportunity we are continuing to focus on newbuild, particularly within our footprint, we're on pace to deliver 175000 passing.

Mark: A lot of that is going to come in the west when we look at.

Mark: We're privileged to be in some of the fastest growing towns in the west and so we are laser focused on.

Mark: Driving our Newbuild strategy.

Operator: But from a political perspective, based on what we see coming in and the orders that have been placed today, we feel bullish about the strength of politics this season and gives us confidence on a full year basis that the news and Advertising Group will be growing over double digits this full year. Mary Ann, would you mind speaking louder? I cannot hear you. Oh. I will raise your volume here.

Speaker Change: <unk> from Morgan Stanley. Your line is now live.

Speaker Change: On the competitive.

Speaker Change: Marianne would you mind speaking louder, we cannot hear you.

Mark: Yeah.

Roger: Hello, Roger volume here.

Speaker Change: Please proceed.

Marc Sirota: Please proceed. Oh, here we go. Thanks, Marianne. We continue to see in the east a little under 70% overbuilt by our fiber competitors, Verizon being the bulk of that, and Frontier being a small portion of that as well. When we look at the west, we have seen an uptick over the last six months.

Speaker Change: I think we're having technical difficulties.

Mark: Hum.

Mark: Okay.

Speaker Change: Sorry are you able to hear me now.

Speaker Change: Yes, yes, okay, sorry about the technical difficulties and thanks for taking the question.

Speaker Change: Just on the competitive landscape can you please update us perhaps on what you're seeing on the pace of incremental fiber builds in both your eastern or western footprint and then on fixed wireless.

Speaker Change: Any difference in the competitive impact between your two footprint. Thank you.

Speaker Change: Thanks, Barry and we continue to see in the east little under.

Speaker Change: 70% overbuilt by our fiber competitors, Verizon being the bulk of that and.

Speaker Change: Frontier being a small portion of that as well when we look at the west we have a we have seen an uptick over the last six months. We are now revising our approach leveraging the BDC data, which has been very helpful and so we do see about a 40%.

Dennis Mathew: We're now revising our approach, leveraging the BDC data, which has been very helpful, and so we do see about 40% of the network overbuilt by fiber overbuilders, AT&T and others. We think about a third of that is AT&T, and two-thirds of that are other fiber overbuilders. That grew by about five percentage points in the last six months, and so we know that that is going to continue to grow, continue to increase, and so we need to have the best quality, the best value, the best products so that we can compete most effectively town by town. And then in the west, depending on the town, depending on where we are in the country, we see pockets of T-Mo, AT&T, and Verizon.

Speaker Change: Overbuilt by fiber.

Speaker Change: Fiber overbuild or as AT&T and others, we think about a third of that is AT&T and two thirds of that our other fiber overbuild, there's that grew about by about five percentage points and.

Speaker Change: In the last six months and so.

Speaker Change: We know that that is going to continue to grow continue to increase and so we need to have the best quality the best value. The best products. So that we can compete most effectively town by town fix.

Speaker Change: <unk> fixed wireless we continue to see across the footprint availability varies again based on their network availability and capacity we.

Speaker Change: We see Tmall, primarily in the east as we think about the primary fiber competitor there.

Speaker Change: We are starting to see pockets of AT&T.

Speaker Change: We're not seeing as much Verizon given their presence with fiber and then in the west depending on the town depending on where we are.

Operator: We have reached the end of our question and answer session. I'd like to turn the floor back over to management for any further or closing comments. Thank you all for joining us. Please reach out to Investor Relations if you have any follow-up questions.

Operator: Thank you. Thank you. Thank you. That does conclude today's teleconference webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.