Q4 2024 CommScope Holding Company Inc Earnings Call

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Masimo: One again, please be advised that today's conference is being recorded I would now like to hand, the conference over to your speaker today Masimo just shop at all Vice President Investor Relations.

Please go ahead.

Masimo: Good morning, and thank you for joining us today to discuss <unk> 2020 for full year and fourth quarter results.

Speaker Change: So motor Sabino, Vice President of Investor Relations for Commscope and with me on today's call are Chuck Treadway, President and CEO.

Caller Ensign: And caller Ensign executive Vice President and CFO.

Speaker Change: After the speaker's presentation, there will be a question and answer session to ask a question. During the session you will need to press star one on your telephone you will there.

Speaker Change: You can find the slides that accompany this report on our Investor Relations website.

Speaker Change: Please note that some of our comments today will contain forward looking statements based on our current view of our business and actual future results may differ materially.

Speaker Change: I didn't hear an automated message advising your hand, just raised withdraw your question. Please press star one again.

Speaker Change: Please see our recent SEC filings, which identify the principal risks and uncertainties that could affect future performance.

Speaker Change: Be advised that today's conference is being recorded I would now like to hand, the conference over to your speaker today Mike.

Speaker Change: Before I turn the call over to Chuck I have a few housekeeping items to review.

Speaker Change: Just shop ago, Vice President Investor Relations.

Speaker Change: We will discuss certain adjusted or non-GAAP financial measures.

Speaker Change: Please go ahead.

Speaker Change: Yes.

Speaker Change: These are described in more detail in this morning's earnings materials Rec.

Speaker Change: Reconciliations of non-GAAP financial measures and other associated disclosures are contained in our earnings materials and posted on our website.

Speaker Change: Good morning, and thank you for joining us today to discuss Commscope is 2020 for full year and fourth quarter results.

Speaker Change: I must smelter Sabadell, Vice President of Investor Relations for Commscope and with me on today's call are Chuck <unk>, President and CEO.

All references during today's discussion will be to our adjusted results.

Speaker Change: Our full year and quarterly growth rates described during today's presentation are on a year over year basis, unless otherwise noted.

Speaker Change: In Colorado, Executive Vice President and CFO.

Speaker Change: You can find the slides that accompany this report on our Investor Relations website.

Speaker Change: I'll now turn the call over to our President and CEO Chuck trailer.

Speaker Change: Please note that some of our comments today will contain forward looking statements based on our current view of our business and actual future results may differ materially.

Massimo: Thank you Massimo.

Chuck trailer: I'll begin on slide two.

Massimo: Im pleased to announce our fourth quarter results in the fourth quarter Commscope delivered core net sales of $1 7 billion a.

Speaker Change: Please see our recent SEC filings, which identify the principal risks and uncertainties that could affect future performance.

Massimo: The year over year increase of 27%.

Massimo: <unk> adjusted EBITDA of $240 million, a year over year increase of 69% driven by strength in at Ccs and coordinated business.

Speaker Change: Before I turn the call over to Chuck I have a few housekeeping items to review.

Speaker Change: We will discuss certain adjusted or non-GAAP financial measures.

Speaker Change: Each are described in more detail in this morning's earnings materials Rec.

Massimo: Core adjusted EBITDA as a percent of revenues of 26% was one of the highest commscope has achieved since the arris acquisition.

Speaker Change: Reconciliations of non-GAAP financial measures and other associated disclosures are contained in our earnings materials and posted on our website.

Massimo: I am very pleased with our fourth quarter performance as we sequentially improved revenue and adjusted EBITDA for the third consecutive quarter.

Speaker Change: All references during today's discussion will be to our adjusted results.

Speaker Change: Our full year and quarterly growth rates described during today's presentation are on a year over year basis, unless otherwise noted.

Massimo: Our strong adjusted EBITDA as a percentage of revenues.

Massimo: Validates that we are effectively managing what we can control.

Speaker Change: I'll now turn the call over to our President and CEO Chuck Trade Lane.

Massimo: On an annual basis core Commscope delivered net sales of $4 to $1 billion.

Speaker Change: Thank you Massimo.

Speaker Change: I'll begin on slide two.

Massimo: Decreasing 8% from the prior year.

Speaker Change: I am pleased to announce our fourth quarter results in the fourth quarter Commscope delivered core net sales of $1 $7 billion, a year over year increase of 27% and core adjusted EBITDA $240 million a year over year increase of 69% driven by strength in at Ccs and coordinates.

Massimo: The decline in revenue resulted in core adjusted EBITDA of $756 million in line with prior year.

Massimo: We ended the year exceeding our provided $700 million to $750 million core adjusted EBITDA range.

As we move into 2025, we are well positioned for substantial growth in all of our businesses.

Speaker Change: Business.

Speaker Change: Core adjusted EBITDA as a percent of revenues up 26% was one of the highest commscope has achieved since the arris acquisition.

Massimo: We're exiting the year at a quarterly rate that is substantially higher than the 2024 quarterly average.

Massimo: Based on current visibility, we are projecting 2025 core adjusted EBITDA in.

Speaker Change: I am very pleased with our fourth quarter performance as we sequentially improved revenue and adjusted EBITDA for the third consecutive quarter.

Massimo: And the $1.0 billion to $1.05 billion range.

Speaker Change: Our strong adjusted EBITDA as a percentage of revenues.

Massimo: In addition to strong results, we made significant progress on our debt positioning during the fourth quarter by refinancing a portion of our debt.

Speaker Change: Validates that we are effectively managing what we can control.

Speaker Change: On an annual basis core Commscope delivered net sales of $4 to $1 billion.

Massimo: The debt refinancing coupled with the sale of our <unk> and <unk> businesses that closed on January 31.

Speaker Change: Decreasing 8% from the prior year.

Speaker Change: The decline in revenue resulted in core adjusted EBITDA of $756 million in line with prior year.

Massimo: And subsequent pay down of approximately $2 billion of debt with the proceeds clearly puts us in a stronger position to focus on business growth free cash flow generation and deleveraging.

Speaker Change: We ended the year exceeding our provided $700 million to $750 million core adjusted EBITDA range.

Massimo: I would like to thank the lender group that assisted in facilitating our debt deal.

Speaker Change: As we move into 2025, we are well positioned for substantial growth in all of our businesses.

Massimo: The confidence they have in our business positions us to continue to implement our strategy and increase our equity value.

Speaker Change: We're exiting the year at a quarterly rate that is substantially higher than the 2024 quarterly average.

Massimo: Finally, I would like to thank our <unk> team and wish them great success with Amphenol.

Speaker Change: Based on current visibility, we are projecting 2025 core adjusted EBITDA.

Massimo: Now I'd like to give you an update on each of our core businesses.

Speaker Change: And the $1.0 billion to $1.05 billion range.

Massimo: Ccs 'twenty 'twenty four full range revenue grew four 5% and adjusted EBITDA increased 55% compared to full year 2023.

Speaker Change: In addition to strong results, we made significant progress on our debt positioning during the fourth quarter by refinancing a portion of our debt.

Speaker Change: The debt refinancing coupled with the sale of our <unk> and <unk> businesses that closed on January 31.

Massimo: In the fourth quarter Ccs revenue grew 36%, while Ccs adjusted EBITDA increased 110% as a result of revenue growth across all of our product lines.

Speaker Change: Subsequent pay down of approximately $2 billion of debt with the proceeds clearly puts us in a stronger position to focus on business growth free cash flow generation and deleveraging.

Massimo: Ccs adjusted EBITDA as a percentage of revenue was approximately 23, 4% showing continued strength.

Speaker Change: I would like to thank the lender group that assisted in facilitating our debt deal.

Massimo: As we manage new product introductions cost and fixed cost leverage.

Speaker Change: The confidence they have in our business positions us to continue to implement our strategy and increase our equity value.

Massimo: As we exit the year I would like to call out our enterprise fiber business that holds our products that we sell into the datacenter market.

Speaker Change: Finally, I would like to thank our <unk> team.

Massimo: For the full year that business drove revenues of $623 million.

Speaker Change: And wish them great success with Amphenol.

Speaker Change: Now I'd like to give you an update on each of our core businesses.

Massimo: 73% increase year over year.

Massimo: In the fourth quarter alone the enterprise business had $202 million of revenue an increase over fourth quarter 2023 of 96%.

Speaker Change: Ccs 'twenty 'twenty four full range revenue grew four 5% and adjusted EBITDA increased 55% compared to full year 2023.

Speaker Change: In the fourth quarter Ccs revenue grew 36%, while Ccs adjusted EBITDA increased 110% as a result of revenue growth across all of our product lines.

Massimo: With the growth we've seen in 2020 for the enterprise fiber business represented 22% of Ccs revenue and 27% of total fourth quarter Ccs revenue.

Speaker Change: Ccs adjusted EBITA as a percentage of revenue was approximately 23, 4% showing continued strength.

Massimo: We are very excited about the market projections for the data center business and our positioning in this market.

Speaker Change: As we manage new product introductions cost and fixed cost leverage.

Massimo: Third party market analysis indicates 30 plus percent annual revenue growth over the next few years in our business the.

Speaker Change: As we exit the year I would like to call out our enterprise fiber business that holds our products that we sell into the data center market.

Massimo: The demand in our enterprise fiber business is not solely driven by growth in data centers, but the complexity of new AI focused data centers that require five to 10 times the amount of our cabling and connectivity solutions versus the traditional data centers.

Speaker Change: For the full year that business drove revenues of $623 million.

Speaker Change: A 73% increase year over year.

Speaker Change: In the fourth quarter alone the enterprise business had $202 million of revenue an increase over fourth quarter 2023 of 96%.

Massimo: Commscope is well positioned in the data center markets with a breadth of products and capacity to meet the service and quality requirements.

Massimo: We believe we have taken market share and expect continued share gains in 2025.

Speaker Change: With the growth we've seen in 2020 for the enterprise fiber business represented 22% of Ccs revenue and 27% of total fourth quarter Ccs revenue.

Massimo: We continue to invest in new capacity and are in the middle of a capacity expansion that will deliver an additional $300 million.

Massimo: Of revenue at full capacity.

Speaker Change: We are very excited about the market projections for the data center business and our positioning in this market.

Massimo: We would expect additional capacity expansions in 2025 to keep up with the projected strong growth in this market.

Speaker Change: Third party market analysis indicates 30 plus percent annual revenue growth over the next few years in our business.

Massimo: And our other Ccs business units.

Massimo: Broadband and structured cable demand has returned out their soft first quarter in 2024.

Speaker Change: The demand in our enterprise fiber business is not solely driven by growth in data centers, but the complexity of new AI focused data centers that require five to 10 times the amount of our cabling and connectivity solutions versus the traditional data centers.

Massimo: In both businesses, we believe that customers have normalized inventory and we are back to demand matching the deployment rates and.

Massimo: In broadband we believe that <unk> will have a positive impact on our revenues.

Speaker Change: Commscope is well positioned in the data center markets with a breadth of products and capacity to meet the service and quality requirements.

Massimo: However, we don't expect anything meaningful to materialize until 2026.

Massimo: Outside of the bead demand drivers over the next few years are strong and we're investing to grow share internationally.

Speaker Change: We believe we have taken market share and expect continued share gains in 2025.

Speaker Change: We continue to invest in new capacity and are in the middle of a capacity expansion that will deliver an additional $300 million.

Massimo: We're investing in new products with the launch of our prodigy connector and broadband, including signing a license agreement for others to use our product.

Speaker Change: Revenue at full capacity.

Massimo: On the structured cable business, we continue to drive market leadership with several new products launched in 2024, including system acts to visit Port Giga, <unk> cel and Giga speed <unk> Sulphides.

Speaker Change: We would expect additional capacity expansions in 2025 to keep up with the projected strong growth in this market.

Speaker Change: And our other Ccs business units.

Speaker Change: <unk> is structured cable demand has returned out their soft first quarter in 2024.

Massimo: These solutions have demonstrated a renewed focus and an expanded portfolio of future ready solutions that are agile enough for the most demanding networks.

Speaker Change: In both businesses, we believe that customers have normalized inventory and we are back to demand matching the deployment rates.

Massimo: Overall between data centers, the normalization of customer inventory and the projected market growth in broadband we are encouraged as we move into 2025 and expect very strong growth year over year and Ccs.

In broadband we believe that <unk> will have a positive impact on our revenues.

Speaker Change: However, we don't expect anything meaningful to materialize until 2026.

Outside of bead demand drivers over the next few years are strong and we are investing to grow share internationally.

Massimo: Turning to core <unk>, which excludes das revenue was up 13% in the fourth quarter compared to prior year.

Speaker Change: We're investing in new products with the launch of our prodigy connector and broadband, including signing a license agreement for others to use our product.

Massimo: <unk>, adjusted EBITDA was up $19 million or 285% versus prior year.

Speaker Change: On the structured cable business, we continue to drive market leadership with several new products launched in 2024, including system acts to visit Port Giga reach XL and Giga speed <unk> sulphide.

Massimo: This was driven by higher revenue from Ruckus.

Massimo: We feel that the challenges in the first half with channel inventory are behind us as inventory levels have normalized.

Massimo: As the business moves back to historical seasonality, we believe the ruckus business is well positioned for growth in 2025.

Speaker Change: These solutions have demonstrated a renewed focus and an expanded portfolio of future ready solutions that are agile enough for the most demanding networks.

Massimo: In addition to normalized inventory and subsequent demand we have seen a lot of traction with our ruckus initiatives, including our recently announced ruckus edge platform as well as the specific vertical strategy focus on manufacturing higher education and pro AG markets.

Speaker Change: Overall between data centers, the normalization of customer inventory and the projected market growth in broadband we are encouraged as we move into 2025 and expect very strong growth year over year and Ccs.

Massimo: Ruckus edge that we called out on our last call has seen increased traction.

Speaker Change: Turning to core next which excludes das revenue was up 13% in the fourth quarter compared to prior year.

Massimo: This platform extends to cloud based AI Ruckus Ruckus, one platform to the edge of the network to enable rapid deployment and simplified management of these networks from anywhere.

Speaker Change: Core next adjusted EBITDA was up $19 million or 285% versus prior year.

Massimo: Making it easier than ever to deploy maintain and expand networks.

Speaker Change: This was driven by higher revenue for Ruckus.

Speaker Change: We feel that the challenges in the first half with channel inventory are behind us as inventory levels have normalized.

Massimo: In addition, we have introduced an improved channel partner program and added a number of sales resources.

Speaker Change: As the business moves back to historical seasonality, we believe the ruckus business is well positioned for growth in 2025.

Massimo: Just like our Ccs segment, we remain bullish on the core <unk> business and are investing for our next phase of growth.

Speaker Change: In addition to normalized inventory and subsequent demand we have seen a lot of traction with our ruckus initiatives, including our recently announced ruckus edge platform as well as the specific vertical strategy focus on manufacturing higher education and pro AB markets.

Massimo: Finishing our core business updates with Ams we.

Massimo: We mentioned 2024 has been a transitional year for E&S driving historically weak performance.

Massimo: Our customers were faced with larger than expected inventory as well as navigating the choices for next generation HFC architecture and.

Speaker Change: Ruckus edge that we called out on our last call has seen increased traction.

Massimo: And we are still continuing and we are still in continued development of next generation products.

Speaker Change: This platform extends to cloud based AI Ruckus Ruckus, one platform to the edge of the network to enable rapid deployment and simplified management of these networks from anywhere.

Massimo: Despite a weak 2024, we believe <unk> is best positioned with decades of knowledge of our customers' ecosystems and our breadth of new products for service providers to take advantage of the latest DOCSIS upgrade cycle.

Making it easier than ever to deploy maintain and expand networks.

Speaker Change: In addition, we have introduced an improved channel partner program and added a number of sales resources.

Massimo: Our suite of products includes all areas of the HFC network, including virtual <unk> nodes amplifiers, and RPT and RMB modules.

Speaker Change: Just like our Ccs segment, we remain bullish on the core <unk> business and are investing for our next phase of growth.

Massimo: During the fourth quarter, we had meaningful shipments of mdx nodes to Comcast and expect to significantly ramp up shipments in 2025.

Speaker Change: Finishing our core business updates with Aaas we.

Speaker Change: We mentioned 2024 has been a transitional year for Aam's driving historically weak performance.

Massimo: We are the only proven MTX amplify our manufacturer currently in the market.

Speaker Change: Our customers were faced with larger than expected inventory as well as navigating the choices for next generation HFC architecture and.

Massimo: And this will result in a major improvement of our business in 2025.

Massimo: Marking the beginning of a multiyear upgrade cycle.

Speaker Change: And we are still continuing.

Massimo: We have also moved our virtual C cap program forward completing many lab trials and are now on several field trials.

Speaker Change: Still and continued development of next generation products.

Speaker Change: Despite a weak 2024, we believe <unk> is best positioned with decades of knowledge of our customers' ecosystems and our breadth of new products for service providers to take advantage of the latest DOCSIS upgrade cycle.

Massimo: All major steps to winning business with major HFC tier one customers globally.

Massimo: Momentum has been building in the next phase of upgrades are coming service providers are going to be tasked with upgrading their next generation networks. So the real question remains the timing and magnitude of the upcoming upgrade cycle for our customers.

Speaker Change: Our suite of products includes all areas of the HFC network, including virtual <unk> nodes amplifiers, and RPT and RMB modules.

Massimo: Overall, we continue to navigate our business through improved market conditions as some of our businesses are benefiting quicker than others.

Speaker Change: During the fourth quarter, we had meaningful shipments of EFT Dx nodes to Comcast and expect to significantly ramp up shipments in 2025.

Massimo: We are bullish over the next few years and all of our segments for our core businesses improved ordering trends and a stronger second half of 2024 have given us confidence that better market conditions and focusing on what we control.

Speaker Change: We are the only proven MTX amplify our manufacturer currently in the market.

Speaker Change: And this will result in a major improvement of our business in 2025.

Speaker Change: Marking the beginning of a multiyear upgrade cycle.

Speaker Change: We have also moved our virtual C cap program forward completing many lab trials and are now on several field trials.

Massimo: Help us improve our results in 2025 and beyond.

Massimo: We will continue to control, what we can including supporting our customers as they navigate through their networks upgrades and builds.

Speaker Change: All major steps to winning business with major HFC tier one customers globally.

Massimo: Based on actions that we've taken including Commscope next initiatives, we expect strong profitability improvements as revenue recovers.

Speaker Change: Momentum has been building in the next phase of upgrades are coming service providers are going to be tasked with upgrading their next generation networks. So the real question remains the timing and magnitude of the upcoming upgrade cycle for our customers.

Massimo: This is evidenced by our strong adjusted EBITDA as a percentage of revenue in the fourth quarter of 26%.

Massimo: Ultimately driving company performance and the company's total debt to adjusted EBITDA ratio below six times by the end of 2026.

Speaker Change: Overall, we are continuing to navigate our business through improved market conditions.

Some of our businesses are benefiting quicker than others.

Massimo: And with that I'd like to turn things over to Kyle to talk more about our full year and fourth quarter results.

Speaker Change: We are bullish over the next few years and all of our segments.

Speaker Change: For our core businesses improved ordering trends and a stronger second half of 2024 have given us confidence that better market conditions and focusing on what we control.

Kyle: Thank you Chuck and good morning, everyone I will start with an overview of our full year 2024 results on slide three.

Kyle: For the full year Commscope reported net sales from continuing operations of $4 $2 6 billion.

Speaker Change: We will help us improve our results in 2025 and beyond.

Speaker Change: We will continue to control, what we can including supporting our customers as they navigate through their networks upgrades and bills.

Kyle: A decrease of 8% from the prior year, primarily driven by the delayed upgrade cycle in E&S.

Speaker Change: Based on actions that we've taken including Commscope next initiatives, we expect strong profitability improvements as revenue recovers.

Adjusted EBITDA from continuing operations was $700 million.

Kyle: Which increased by 5%.

Kyle: Adjusted EPS was a loss of <unk> <unk> per share.

Speaker Change: This is evidenced by our strong adjusted EBITDA as a percentage of revenue in the fourth quarter of 26%.

Kyle: For core Commscope, which excludes the OWS and daas businesses and general corporate costs that were previously allocated to the OWS dos and home businesses, We reported core adjusted EBITDA of $756 million for the full year of 2024, which ended flat versus <unk>.

Speaker Change: Ultimately driving company performance and the company's total debt to adjusted EBITDA ratio below six times by the end of 2026.

Speaker Change: And with that I'd like to turn things over to Kyle to talk more about our full year and fourth quarter results.

Kyle: Thank you Chuck and good morning, everyone I'll start with an overview of our full year 2024 results on slide three.

Kyle: Prior year.

Kyle: Our adjusted EBITDA as a percentage of revenues of 18% increased by 140 basis points year over year as we continue to manage what we can control including costs.

Kyle: For the full year Commscope reported net sales from continuing operations of $4 to $6 billion.

Kyle: A decrease of 8% from the prior year, primarily driven by the delayed upgrade cycle in E&S.

For Commscope, including OWS Dos we reported net sales of 547, 2 billion, which decreased 5% from prior year with adjusted EBITDA of $1 <unk> 5 billion.

Kyle: Adjusted EBITDA from continuing operations was $700 million, which increased by 5% adjusted.

Kyle: Adjusted EPS was a loss of <unk> <unk> per share.

Kyle: For the full year of 2024, which increased 10% from prior year.

Kyle: For core Commscope, which excludes the OWS and daas businesses and general corporate costs that were previously allocated to the OWS dos and home businesses, We reported core adjusted EBITDA of $756 million for the full year of 2024, which ended flat versus prior.

Kyle: Turning now to our fourth quarter results on slide four.

Kyle: For core Commscope, which excludes the OWS and daas businesses and general corporate costs that were previously allocated to the OWS dos and home businesses, We reported core adjusted EBITDA of $240 million for the fourth quarter of 2024, which increased 60.

Kyle: Near year.

Kyle: Our adjusted EBITDA as a percentage of revenues of 18% increased by 140 basis points year over year as we continue to manage what we can control including costs.

Kyle: 9% from prior year.

Kyle: It should be noted that these results include a one time inventory charge of $18 million in our E&S business without that charge adjusted EBITDA would have been $258 million.

Kyle: For Commscope, including OWS Dos we reported net sales of 547, 2 billion, which decreased 5% from prior year with adjusted EBITDA of $1 <unk> 5 billion for.

Kyle: The actual result was a 9% improvement sequentially versus the third quarter.

Kyle: Our adjusted EBITDA as a percentage of revenues of 26% increased by 510 basis points year over year.

Kyle: For the full year of 2024, which increased 10% from prior year.

Kyle: Turning now to our fourth quarter results on slide four.

Kyle: For the fourth quarter Commscope reported net sales from continuing operations of $1 69 billion.

Kyle: For core Commscope, which excludes the OWS and <unk> businesses and general corporate costs that were previously allocated to the OWS dos and home businesses, We reported core adjusted EBITDA of $240 million for the fourth quarter of 2024, which increased 60.

Kyle: An increase of 27% from the prior year driven by an increase in all segments.

Kyle: Adjusted EBITDA from continuing operations of $223 million increased by 87%.

Kyle: 9% from prior year.

Kyle: Adjusted EPS was <unk> 18 per share.

Kyle: It should be noted that these results include a one time inventory charge of $18 million in our E&S business without that charge adjusted EBITDA would have been $258 million.

Kyle: We experienced improved sequential revenue and adjusted EBITDA, driven by increasing demand in Ccs and <unk> products.

Kyle: For Commscope, including OWS and Das we reported net sales of $1 $5 2 billion, which increased 27% from prior year.

Kyle: The actual result was a 9% improvement sequentially versus the third quarter.

Kyle: Our adjusted EBITDA as a percentage of revenues of 26% increased by 510 basis points year over year.

Kyle: With adjusted EBITDA of $330 million for the fourth quarter of 2024, increasing 75% from prior year.

Kyle: For the fourth quarter Commscope reported net sales from continuing operations of $1 69 billion.

Kyle: Core Commscope backlog ended the quarter at $977 million up versus the end of the third quarter.

An increase of 27% from the prior year driven by an increase in all segments.

Kyle: As mentioned previously in all of our businesses, we are back to normalized backlog levels with short lead times.

Kyle: Adjusted EBITDA from continuing operations of $223 million increased by 87%.

We now expect our core businesses to align closer to historic quarterly order trends.

Kyle: Adjusted EPS was <unk> 18 per share.

Kyle: Turning now to our fourth quarter highlights on slide five starting with Ccs net sales of $754 million increased 36% from the prior year.

Kyle: We experienced improved sequential revenue and adjusted EBITDA, driven by increasing demand in Ccs and <unk> products.

Kyle: For Commscope, including OWS and Das we reported net sales of $1 $502 billion.

Kyle: <unk> adjusted EBITDA of $176 million increased 110% from the prior year.

Kyle: Which increased 27% from prior year.

Kyle: Ccs adjusted EBITDA as a percentage of revenue for the quarter remained strong at 23, 4% driven by favorable mix cost savings and cost leverage.

Kyle: With adjusted EBITDA of $330 million for the fourth quarter of 2024, increasing 75% from prior year.

Kyle: Although we expect Ccs adjusted EBITDA as a percentage of revenue to remain strong.

Kyle: Core Commscope backlog ended the quarter at $977 million up versus the end of the third quarter.

Kyle: We would not expect it to remain at this level for the first quarter of 2025, as we return to normal seasonality and lower activity levels in the first and fourth quarters.

Kyle: As mentioned previously in all of our businesses, we are back to normalized backlog levels with short lead times and we now expect our core businesses to align closer to historic quarterly order trends.

Kyle: The Ccs revenue increase was driven by all product lines with Hyperscale and cloud data centers seeing the strongest growth.

Kyle: Turning now to our fourth quarter highlights on slide five starting with Ccs net sales of $754 million increased 36% from the prior year.

Kyle: We are excited about the datacenter market projections and our positioning in the market.

Kyle: Based on third party analysis and discussions with our customers, we expect 30% plus annual growth over the next several years in this market.

Kyle: <unk> adjusted EBITDA of $176 million increased to 110% from the prior year.

We are well positioned to take market share as we continue to invest in capacity and new products are.

Kyle: Ccs adjusted EBITDA as a percentage of revenue for the quarter remained strong at 23, 4% driven by favorable mix cost savings and cost leverage.

Kyle: Our enterprise fiber business grew 73% in 2024.

Kyle: On a sequential basis overall Ccs grew 2% looking.

Although we expect Ccs adjusted EBITDA as a percentage of revenue to remain strong.

Kyle: Looking towards the first quarter, we expect revenue to be in line with the fourth quarter, but EBITDA to decline based on product mix.

Kyle: We would not expect it to remain at this level for the first quarter of 2025, as we return to normal seasonality and lower activity levels in the first and fourth quarters.

Kyle: Core next net sales of $154 million increased by 13% versus the fourth quarter of 2023, driven by normalized inventory in the channel.

Kyle: The Ccs revenue increase was driven by all product lines with Hyperscale and cloud data centers seen the strongest growth.

<unk> adjusted EBITDA of $26 million increased 285% from the prior year, primarily driven by the increase in Ruckus revenue.

Kyle: We are excited about the datacenter market projections and our positioning in the market.

Kyle: Based on third party analysis and discussions with our customers, we expect 30% plus annual growth over the next several years in this market.

Kyle: As noted in previous calls the overhang from channel inventory last year through the first half of 2024 and started to improve in the third quarter.

Kyle: We are well positioned to take market share as we continue to invest in capacity and new products are.

Kyle: On a sequential basis revenue decreased 2% and EBITDA decreased 6% due to seasonality.

Kyle: Our enterprise fiber business grew 73% in 2024.

Kyle: We continue to drive our vertical market strategies, and ruckus initiatives, including Ruckus edge and Wi Fi seven initiatives and.

Kyle: On a sequential basis overall Ccs grew 2% looking.

Kyle: Looking towards the first quarter, we expect revenue to be in line with the fourth quarter, but EBITDA to decline based on product mix.

Kyle: In addition, we continue to shift more of our business to subscription.

Kyle: With the new products.

Kyle: And vertical market focus we are well positioned to take market share in the medium and long term.

Kyle: Core next net sales of $154 million increased by 13% versus the fourth quarter of 2023, driven by normalized inventory in the channel.

Kyle: We are making a large investment in our go to market organization investing approximately $15 million and frontline sales to expand our reach.

Kyle: <unk> adjusted EBITDA of $26 million increased 285% from the prior year, primarily driven by the increase in Ruckus revenue.

Kyle: First quarter <unk> adjusted EBITDA is expected to decline compared to fourth quarter results.

Kyle: Due to the increase in variable compensation and a reserve returned to historical order patterns, and which Q4 and Q1 tend to be lower.

As noted in previous calls the overhang from channel inventory last year through the first half of 2024 and started to improve in the third quarter.

Kyle: On a sequential basis revenue decreased 2% and EBITDA decreased 6% due to seasonality.

Kyle: <unk> net sales of $261 million increased 12% from the prior year.

Kyle: As customer inventory levels begin to stabilize and we saw some initial shipments of our <unk> products.

Kyle: We continue to drive our vertical market strategies, and ruckus initiatives, including Ruckus edge and Wi Fi seven initiatives and.

<unk> adjusted EBITDA of $38 million was down $14 million or 27% from the prior year driven by lower software revenue.

Kyle: In addition, we continue to shift more of our business to subscription.

Kyle: With the new products.

Kyle: And vertical market focus we are well positioned to take market share in the medium and long term.

Kyle: Unfavorable product mix and an increase in <unk> charges in the quarter.

Kyle: We are making a large investment in our go to market organization investing approximately $15 million and frontline sales to expand our reach.

Kyle: As mentioned earlier <unk> realized a one time 18 million inventory write down in the fourth quarter.

Kyle: First quarter <unk> adjusted EBITDA is expected to decline compared to fourth quarter results.

Kyle: <unk> had a very challenging 2024 as customers continue to delay their upgrade cycle in the legacy business continued to decline.

Kyle: Due to the increase in variable compensation and a reserve returned to historical order patterns, and which Q4 and Q1 tend to be lower.

Kyle: We expect to see both revenue and EBITDA down in first quarter versus the fourth quarter due to project timing.

Kyle: <unk> net sales of $261 million increased 12% from the prior year.

Kyle: However, we are excited about 25% as we launch our <unk> unified products, we are expecting a strong rebound in revenue and adjusted EBITDA as our investments made over the last three years on product development have positioned us for the pending upgrade cycle.

Kyle: As customer inventory levels begin to stabilize and we saw some initial shipments of our <unk> products.

Kyle: <unk> adjusted EBITDA of $38 million was down $14 million or 27% from the prior year driven by lower software revenue.

Kyle: The business remains well positioned to take advantage of upgrade cycles as we have decades of experience with customer ecosystems, the largest installed base and the broadest suite of products performance.

Kyle: Unfavorable product mix and an increase in <unk> charges in the quarter.

Kyle: Performance will be driven by the speed and magnitude of the upcoming upgrade cycle that is in early stages.

Kyle: As mentioned earlier <unk> realized a one time 18 million inventory write down in the fourth quarter.

Kyle: Finally early in the first quarter, we completed the divestiture of the OWS and daas businesses to ethanol.

Kyle: <unk> had a very challenging 2024 as customers continue to delay their upgrade cycle in the legacy business continued to decline.

Kyle: Net sales of these two businesses were $333 million in the fourth quarter and increased 27% from the prior year.

Kyle: We expect to see both revenue and EBITDA down in first quarter versus the fourth quarter due to project timing.

Kyle: Note that the activity of these businesses are reported as discontinued operations, while the assets and liabilities of these businesses were reported as held for sale this quarter.

Kyle: However, we are excited about 2025 as we launch our <unk> unified products, we are expecting a strong rebound in revenue and adjusted EBITDA as our investments made over the last three years on product development have positioned us for the pending upgrade cycle.

Kyle: Turning to slide six for an update on cash flow.

Kyle: During the quarter, we generated $278 million from cash flow from operations and free cash flow of $271 million.

Kyle: The business remains well positioned to take advantage of upgrade cycles as we have decades of experience with customer ecosystems, the largest installed base and the broadest suite of products.

Kyle: 2020 for fourth quarter cash flow from operations increased from the prior year driven by higher EBITDA.

Kyle: As we look at cash flow guidance for 2025, we expect breakeven cash flow in this guidance, we project an investment in capital expenditures and working capital of over $200 million driven.

Kyle: Performance will be driven by the speed and magnitude of the upcoming upgrade cycle that is in early stages.

Kyle: Finally early in the first quarter, we completed the divestiture of the OWS and daas businesses to ethanol.

Kyle: Driven by growth in the business.

Kyle: Net sales of these two businesses were $333 million in the fourth quarter and increased 27% from the prior year.

Kyle: I would highlight that historically first quarter is a quarter with significant use of cash driven by our high cash interest payment quarter and incentive payouts.

Kyle: Note that the activity of these businesses reported as discontinued operations, while the assets and liabilities of these businesses were reported as held for sale this quarter.

Kyle: Turning to slide seven for an update on our liquidity and capital structure.

Kyle: During the fourth quarter, our cash and liquidity remains strong we ended the quarter with $663 million in global cash and total available cash and liquidity of roughly $1 1 billion.

Kyle: Turning to slide six for an update on cash flow.

Kyle: During the quarter, we generated $278 million from cash flow from operations and free cash flow of $271 million.

Kyle: During the quarter, our cash balance increased by $207 million.

Kyle: 2020 for fourth quarter cash flow from operations increased from the prior year driven by higher EBITDA.

Kyle: We drew $200 million on our ABL revolver during the fourth quarter as part of our refinancing terms.

Kyle: As we look at cash flow guidance for 2025, we expect breakeven cash flow in this guidance, we project an investment in capital expenditures and working capital of over $200 million driven by growth in the business.

Kyle: We repaid all outstanding amounts of the ABL at the end of January after closing our transaction for the OWS and das business to Amphenol.

Kyle: It should also be noted that we lost approximately $140 million of our ABL availability with the OWS Das transaction.

Kyle: I would highlight that historically first quarter is a quarter with significant use of cash driven by our high cash interest payment quarter and incentive payouts.

Kyle: During the quarter Commscope entered into a new debt agreement with his existing first lien lenders to <unk>.

Kyle: Turning to slide seven for an update on our liquidity and capital structure.

Kyle: <unk> $315 billion.

Kyle: During the fourth quarter, our cash and liquidity remains strong we ended the quarter with $663 million in global cash and total available cash and liquidity of roughly $1 1 billion.

Kyle: <unk> first lien term loan maturing in 2029 and $1 billion in first lien notes maturing in 2031.

Kyle: Proceeds from the new first lien debt enabled the company to fully repay its senior unsecured notes due in 2025 and its existing senior secured term loan facility.

Kyle: During the quarter, our cash balance increased by $207 million.

Kyle: We drew $200 million on our ABL revolver during the fourth quarter as part of our refinancing terms.

Kyle: Proceeds from the previously announced sale of the company's OWS segment as well as its stock business unit to Amphenol for $2 1 billion were used to repay all outstanding amounts under the company's asset backed revolving credit facility.

Kyle: We repaid all outstanding amounts of the ABL at the end of January after closing our transaction for the OWS and das business to ethanol.

Kyle: It should also be noted that we lost approximately $140 million of our ABL availability with the OWS Das transaction.

Kyle: Repay in part the company's 475% senior secured notes due 2029.

Kyle: During the quarter Commscope entered into a new debt agreement with his existing first lien lenders to borrow $315 billion firm.

Kyle: Repay in full the company's 6% senior secured notes due 2026 and pay fees and expenses associated with the transaction.

Kyle: First lien term loan maturing in 2029 and $1 billion in first lien notes maturing in 2031.

Kyle: We purchased no debt on the open market. However, going forward, we will continue to use cash opportunistically to buy back securities across the breadth of our capital structure.

Kyle: Proceeds from the new first lien debt enabled the company to fully repay its senior unsecured notes due in 2025 and its existing senior secured term loan facility.

Kyle: The company ended the quarter with net leverage ratio of seven eight times down from the prior quarter of nine one times.

Kyle: Proceeds from the previously announced sale of the company's OWS segment as well as its stock business unit to Amphenol for $2 1 billion.

Kyle: The calculation of the net leverage includes the OWS and <unk> businesses.

Kyle: I'll now turning to slide eight where I will conclude my prepared remarks with some commentary around our expectations for 2025.

Kyle: Were used to repay all outstanding amounts under the company's asset backed revolving credit facility.

Kyle: In our core business, we have seen sequential quarterly revenue and adjusted EBITDA improvement from the first quarter to the fourth quarter of 2024.

Kyle: Repay in part the Companys, 475% senior secured notes due 2029.

Kyle: Repay in full the company's 6% senior secured notes due 2026 and pay fees and expenses associated with the transaction.

Kyle: We exited 2024 and a much stronger position than we started the year. During 2024, we have seen strong recovery in our Ccs business driven by data center, Jan AI growth and inventory normalization.

Kyle: We purchased no debt on the open market. However, going forward, we will continue to use cash opportunistically to buy back securities across the breadth of our capital structure.

Kyle: We expect that this trend will continue.

Kyle: <unk> and <unk> segments are projected to rebound from challenges in 2024. This is evidenced by improvement in the second half of 2024 in these businesses.

Kyle: The company ended the quarter with net leverage ratio of seven eight times down from the prior quarter of nine one times the.

Kyle: The calculation of the net leverage includes the OWS and daas businesses.

Kyle: Overall, driven by the improved performance throughout 2024, we expect our 2025 adjusted EBITDA in the range of one to one 5 billion.

Kyle: I'll now turning to slide eight where I will conclude my prepared remarks with some commentary around our expectations for 2025.

Kyle: Similar to what we experienced in 2024, we expect the second half to be stronger than the first half.

Kyle: In our core business, we have seen sequential quarterly revenue and adjusted EBITDA improvement from the first quarter to the fourth quarter of 2024.

We would expect first quarter core revenue and adjusted EBITDA to be down from fourth quarter results as we experienced normal seasonality and project timing.

Kyle: We exited 2024 and a much stronger position than we started the year. During 2024, we have seen strong recovery in our Ccs business driven by data center Gen AI growth and inventory normalization.

Kyle: We continue to control, what we can control, including managing costs and supporting our customers.

Kyle: Our core adjusted EBITDA as a percentage of revenue improved from 15, 4% in the fourth quarter of 2023% to 26% in fourth quarter of 2024.

Kyle: We expect that this trend will continue.

Kyle: <unk> and <unk> segments are projected to rebound from challenges in 2024. This is evidenced by improvement in the second half of 2024 in these businesses.

Kyle: This is a testament to our priority control, what we can and improve long term profitability.

Kyle: Overall, driven by the improved performance throughout 2024, we expect our 2025 adjusted EBITDA in the range of one to one 5 billion.

Chuck: And with that I'd like to give the floor back to Chuck for some closing remarks.

Chuck: Thank you Kyle I'm pleased with where we are positioned as we move into 2025. This is evidenced by our sequential growth during 2024, and our exit rates in the fourth quarter.

Kyle: Similar to what we experienced in 2024, we expect the second half to be stronger than the first half.

Chuck: We believe that many of our customer inventory challenges are behind us and demand is growing in all of our segments.

Kyle: We would expect first quarter core revenue and adjusted EBITDA to be down from fourth quarter results as we experienced normal seasonality and project timing.

Chuck: We have made significant investments in our product offerings and capacity over the last several years and are in a great position to take advantage of the projected stronger markets.

Kyle: We continue to control, what we can control, including managing costs and supporting our customers.

Chuck: The data center market alone is a game changer for Commscope.

Kyle: Our core adjusted EBITDA as a percentage of revenue improved from 15, 4% in the fourth quarter of 2023% to 26% in fourth quarter of 2024.

I am very excited about the market trends and our position.

Chuck: Our teams have done a great job, taking advantage of the growth in the datacenter market with new products and high levels of service and quality.

Kyle: This is a testament to our priority control, what we can and improve long term profitability.

Chuck: As other markets recover and grow we will continue to focus on what we can control through our Commscope next program.

Chuck: And with that I'd like to give the floor back to Chuck for some closing remarks.

And all of our segments, we are exciting initiatives that can add substantial value to commscope.

Chuck: Thank you Kyle I'm pleased with where we are positioned as we move into 2025. This is evidenced by our sequential growth during 2024, and our exit rates in the fourth quarter. We believe that many of our customer inventory challenges are behind us and demand is growing in all of our segments.

Chuck: And with that we'll now open the line for questions.

Speaker Change: Thank you as a reminder to ask a question. Please press star one lie on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one again, please standby, while we compile the Q&A roster.

Chuck: We have made significant investments in our product offerings and capacity over the last several years and are in a great position to take advantage of the projected stronger markets.

Matt: And our first question comes from Matt.

Chuck: The data center market alone is a game changer for Commscope.

Speaker Change: Deutsche Bank. Your line is now open.

Chuck: I am very excited about the market trends and our position.

Speaker Change: Hey, guys. Thanks, so much congrats on the quarter.

Chuck: Our teams have done a great job taking advantage of the growth in the data center market with new products and high levels of service and quality.

Speaker Change: Two if I could I guess first on the core adjusted EBITDA Guide so.

Speaker Change: You've guided to $1 billion to 1 billion Dot five for next year that implies I think relative to the pullback in <unk> that youre talking about the seasonality a pretty.

Chuck: As other markets recover and grow we will continue to focus on what we can control through our Commscope next program.

Speaker Change: Meaningful step ups. So I'm wondering Chuck if you can speak to the visibility and confidence level in that ramp up in.

Chuck: And all of our segments, we have exciting initiatives that can add substantial value to commscope.

Chuck: And with that we'll now open the line for questions.

Speaker Change: In forward periods, and then secondly, just in terms of tariffs I'm wondering if there's anything that's baked into the outlook.

Chuck: Thank you as a reminder to ask a question. Please press star one lie on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one again, please standby while we compile.

Speaker Change: If you can remind us of your manufacturing exposure between the U S and other international markets that could be impacted.

Chuck: The Q&A roster.

Speaker Change: Okay. So I'll take confidence in the recovery question first look we've seen sequential quarterly improvement throughout 2024.

Matt: And our first question comes from Matt.

Dan: Dan Deutsche Bank Your line is open.

Speaker Change: We're exiting the year as Carl said in my did as well at $240 million of adjusted EBITDA and that includes a $17 million inventory or $18 million inventory charge and when you think about these things together or separately I mean, this is well over $950 million adjusted EBITDA going forward.

Matt: Hey, guys. Thanks, so much congrats on the quarter.

Matt: Two if I could I guess first on the core adjusted EBITDA Guide so.

Matt: You guided to $1 billion to $1 billion.

Matt: Five for next year that implies I think relative to the pullback in <unk> that you were talking about that slight seasonality.

Speaker Change: I would also say that we've had lots of positive conversations with our customers and all of the segments in.

Matt: Meaningful step up so im wondering Chuck if you can speak to the visibility and confidence level in that ramp up in.

Speaker Change: I would say the main two drivers to think about in terms of the recovery or both.

Matt: In forward periods, and then secondly, just in terms of tariffs. So im wondering if theres anything thats baked into the outlook.

Speaker Change: Data Center business.

Speaker Change: As well as the <unk> launch.

Speaker Change: We manufacture a lot in the U S as well as in countries, where we sell our products.

Matt: If you can remind us of your manufacturing exposure between the U S and other international markets that could be impacted.

Speaker Change: I'd say overall, we're very supportive of U S manufacturing.

Matt: Okay. So I'll take the confidence in the recovery question first look we've seen sequential quarterly improvement throughout 2024.

Speaker Change: Our most significant and immediate exposure I would say, which is similar to our competition is Mexico.

Speaker Change: And just like others, we're waiting to see what happens with tariffs.

Matt: We're exiting the year as Kyle said and Mike did as well at $240 million of adjusted EBITDA and that includes a $17 million inventory or $18 million inventory charge.

Speaker Change: In the short term.

Speaker Change: We are evaluating price increases and then I would say in the medium term potentially moving some manufacturing and warehousing, but I would say in most cases, we believe we are in a similar similar position with the competition.

Matt: And when you think about these things together or separately I mean, this is well over $950 million adjusted EBITDA going forward.

Matt: I'd also say that we've had lots of positive conversations with our customers and all of the segments in.

Speaker Change: Great. Thank you.

Speaker Change: Thank you.

Matt: I would say the main two drivers to think about in terms of recovery or both.

Speaker Change: Our next question comes from Steven Fox with Fox Advisors. Your line is open.

Matt: Data Center business.

Matt: As well as the SPX launch.

Steven Fox: Hey, good morning, everyone. A couple of questions from me Chuck I was wondering first of all you mentioned market share gains.

Matt: Turning to tariffs, we manufacture a lot in the U S as well as in countries, where we sell our products.

Matt: I'd say overall, we're very supportive of U S manufacturing.

Times when talking about the enterprise fiber business can you sort of dig into what's driving that and also any new products that you're excited about in that business, specifically and then second a little bit of a definitional question. You then talked about broadband and structured cabling.

Matt: Our most significant and immediate exposure I would say, which is similar to our competition is Mexico.

Matt: And just like others, we're waiting to see what happens with tariffs.

Matt: In the short term, we are evaluating price increases and then I would say in the medium term potentially moving some manufacturing and warehousing, but I would say in most cases, we believe we are in a similar similar position with the competition.

Steven Fox: And structured cabling can also be in the enterprise I guess, depending on how we are defining and on the copper side. So I guess can you talk about structured cabling from a copper standpoint.

Steven Fox: In the enterprise or land networks, and how youre thinking about that for the year. Thank you.

Matt: Great. Thank you.

Matt: Thank you.

Steven Fox: Yes in terms of data center.

And positioning of our company I would say.

Speaker Change: Our next question comes from Steven Fox with Fox Advisors. Your line is open.

Steven Fox: Overall, it's about now 15% of our company.

As Carl mentioned, it was 22% for Ccs and.

Steven Fox: Hey, good morning, everyone. A couple questions from me Chuck I was wondering if first of all you mentioned market share gains.

Steven Fox: In 2024, and 27% of our business in the Q4 and when you think about some of the numbers, we talked about growth quarter over quarter, I mean year over year for the fourth quarter I mean almost 100%.

Steven Fox: Times when talking about the enterprise fiber business can you sort of dig into what's driving that and also any new products that you're excited about in that business, specifically and then second a little bit of a definitional question. You then talked about broadband and structured cabling.

Steven Fox: We believe we believe we're a leader in the space I mean, the products the products that we're talking about our NPL connectors race ways and panels.

Steven Fox: And.

Steven Fox: And structured cabling can also be in the enterprise I guess, depending on how we are defining and on the copper side. So I guess can you talk about structured cabling from a copper standpoint.

Steven Fox: We've also went out to third parties to look at.

Steven Fox: What does this mean to us what does this market mean to us.

Steven Fox: With our range.

Steven Fox: In the enterprise or land networks, and how youre thinking about that for the year. Thank you.

Steven Fox: And what's happened in the space and we see that growing at approximately 30%.

Speaker Change: Yes in terms of data center.

Steven Fox: Next three years.

Steven Fox: Driven by this.

Steven Fox: And positioning of our company I would say.

Steven Fox: Okay.

Speaker Change: Overall, it's about now 15% of our company.

Steven Fox: Sure.

Steven Fox: Okay.

Speaker Change: As Carl mentioned, it was 22% for Ccs and.

Steven Fox: Okay.

Steven Fox: Okay.

Speaker Change: In 2024, and 27% of our business in the Q4 and when you think about some of the numbers, we talked about growth quarter over quarter, I mean year over year for the fourth quarter I mean almost 100%.

Steven Fox: And annual.

Steven Fox: Just look at our numbers compared to what I hear from others and I think that we are gaining share there, but I would say in general.

Speaker Change: Just a very fast growing market and we're very pleased that we're in it I'll, let Kyle I'll take the second question.

Speaker Change: We believe we believe we're a leader in the space I mean, the products the products that we're talking about.

Speaker Change: Yes, so on the on the copper side of the business I think we saw in 'twenty four.

Speaker Change: Connectors race ways and panels.

Speaker Change: And.

Speaker Change: Lot of the same dynamics that we saw in some of the other markets like broadband where.

Speaker Change: We've also went out to third parties to look at.

Speaker Change: There was an overbuild of customer inventory they work the inventory off sort of 'twenty three and early in 'twenty four.

Speaker Change: What does this mean to us what does this market mean to us.

Speaker Change: With our consistent.

Speaker Change: Strange.

Speaker Change: In the space and we see that growing at approximately 30%.

Speaker Change: We saw more concrete.

Speaker Change: Similar to the other.

Speaker Change: Next three years.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: Driven by this.

Speaker Change: That's a space that.

Speaker Change: Now.

Speaker Change: We feel like we are a strong leader there where the technology leader and I think Chuck mentioned, some very specific products that we.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: And annual.

Speaker Change: Our giga speed product that we that we rolled out.

Speaker Change: Just look at our numbers compared to what I hear from others and I think that we are gaining share there, but I would say in general.

Speaker Change: 24, so I think.

Speaker Change: Our view on the copper business is worth.

Speaker Change: Just a very fast growing market and we're very pleased that we're in it I'll, let Kyle I'll take the second question.

Speaker Change: The leader, we will see some growth from 24% to five but we saw strong growth in 'twenty, four primarily driven by customer inventory normalization as they work down their inventory that they built in 'twenty three and early in 'twenty four and Stephen Your question about structured cable I mean, there's when you think about the enterprise space in buildings I mean.

Speaker Change: Yes, so on the on the copper side of the business I think we saw in 'twenty four.

Speaker Change: Lot of the same dynamics that we saw in some of the other markets like broadband were.

Speaker Change: There was an overbuild of customer inventory they work the inventory off sort of 'twenty three and early in 'twenty four.

Speaker Change: <unk> is a big piece of it but there is also a fiber piece too. So we don't want to think that.

Speaker Change: We don't want people to think we're only copper in the buildings were also fiber in the buildings as well. So that's why we're moving to more of a name naming convention of structure.

Speaker Change: We saw a more customary.

Speaker Change: Comprehensiveness tailored therapies.

Speaker Change: Yes.

Speaker Change: Great. That's all very helpful. Thank you.

Speaker Change: That's a space that.

Speaker Change: We feel like we are a strong leader there where the technology leader and I think Chuck mentioned, some very specific products that we.

Speaker Change: Thank you.

Simon Leopold: And our next question comes from Simon Leopold of Freemium teams. Your line is open.

Speaker Change: Our giga speed product that we that we rolled out.

Speaker Change: Yeah.

Simon Leopold: Thank you very much appreciate you taking the question.

Speaker Change: 24, so I think.

Speaker Change: Our view on the copper business is worth.

<unk> got.

Speaker Change: Got two here one is looking.

Speaker Change: Later, we will see some growth from 24%, 25%, but we saw strong growth in 'twenty, four primarily driven by customer inventory normalization as they work down their inventory that they built in 'twenty three and early in 'twenty four and Stephen Your question about structured cable I mean, there's when you think about the enterprise space in buildings I mean.

Speaker Change: Looking at this progress in data Center I know historically, you were heavily levered towards enterprise and clearly you're getting some traction here with the larger buyers like the hyperscale.

Speaker Change: So within the growth and the outlook could you help us gain a better understanding of where you stand today within the data center business as to the split between those Hyperscale type buyers in your more traditional enterprise and then I've got a follow up on your own or struggling.

Speaker Change: <unk> is a big piece of it but there is also a fiber piece too. So we don't want to think.

Speaker Change: We don't want people to think we're only copper in the buildings were also fiber in the buildings as well. So that's why we're moving to more of a name naming convention of structure.

Speaker Change: Great. That's all very helpful. Thank you.

Speaker Change: Yes, so I think as we think about data center I mean, we're not going to get into specific numbers, but I just think like generally in the market.

Speaker Change: Thank you.

Speaker Change: And our next question comes from Simon Leopold of Raymond James Your line is now open.

Speaker Change: Definitely weighted toward Hyperscale or.

Speaker Change: The hyperscale.

Speaker Change: The hyperscale or are the drivers of that market.

Speaker Change: Thank you very much appreciate you taking the question.

Speaker Change: Although we play outside of the the data the Hyperscale.

Speaker Change: I've got two here one is.

Speaker Change: Looking at this progress in data Center I know historically, you were heavily levered towards enterprise and clearly you're getting some traction here with the larger buyers like the hyperscale or.

Speaker Change: Definitely it's our business is more weighted toward hyperscale or is done it is the other part of the business.

Speaker Change: Yes, I think what we'd say about the other part of the businesses.

Speaker Change: We saw this.

Speaker Change: Our growth in 'twenty, four isn't coming solely from Hyperscale or it's coming from Hyperscale or is on the on the other cloud data center customers that we have.

Speaker Change: So within this growth and the outlook could you help us gain a better understanding of where you stand today within the data center business as to the split between those Hyperscale type buyers in your more traditional enterprise and then I've got a follow up on the OEM are struggling.

Speaker Change: Great and then on the E&S business you did highlight in your comments the amplifiers.

Speaker Change: Which sound like they're on a good trend, but wondering about Rpgs and nodes I had the impression you are a share gainer in that aspect as well.

Speaker Change: Yes, so I think as we think about data center I mean, we're not going to get into specific numbers, but I just think like generally in the market.

Speaker Change: It's definitely weighted toward hyperscale or.

Speaker Change: And maybe just set a little bit of context in terms of within A&M, how material are amplifier suspect it to be to the mix I think we've been estimating about a third of the revenue just wondering if that's the right ballpark. Thank you.

Speaker Change: The hyperscale.

Speaker Change: Hyperscale or are the drivers of that market.

Speaker Change: Although we play outside of the the data the Hyperscale.

Speaker Change: Definitely it's our business is more weighted toward hyperscale or is than it is.

Speaker Change: When you look at the RPG nodes and amplify RPT nodes and <unk>.

Speaker Change: They're part of the business.

Yes, I think what we'd say about the other part of the businesses. We saw this as our growth in 'twenty four isn't coming solely from hyperscale or it's coming from Hyperscale or.

Speaker Change: Modules I would say when you think about that.

Speaker Change: We believe we're going to be gaining share there because we've been I would say some of the competition went out first and now we're going to be getting more of our share of those pieces.

Speaker Change: On the other cloud data center customers that we have.

Speaker Change: Great and then on the E&S business you did highlight in your comments the amplifiers.

Speaker Change: That's the main point there in terms of the <unk>.

Speaker Change: In terms of the.

Speaker Change: Which sound like they're on a good trend, but wondering about Rpgs and nodes I had the impression you are a share gainer in that aspect as well and.

Speaker Change: The actual size of the <unk> business compared to the total.

Speaker Change: No.

Speaker Change: Yes, I mean, the amplifier business is a little bit higher than the third it's probably in the 40% to 50% range of the E&S business.

Speaker Change: And maybe just set a little bit of context in terms of within A&M. How material are amplifier is expected to be to the mix I think we've been estimating about a third of the revenue just wondering if that's the right ballpark. Thank you.

Speaker Change: Yes.

Speaker Change: Clearly cycles year to year based on just project timing.

Speaker Change: As we think about.

Speaker Change: The fts ample.

Speaker Change: Amplifier ramp that we're talking about in 2025, I mean, that's a that's a pretty substantial ramp.

Speaker Change: When you look at the RPG nodes and amplify RPT nodes and.

Speaker Change: As we as we as we roll those products out.

Speaker Change: Modules I would say when you think about that.

Speaker Change: <unk>.

Speaker Change: 2025, the impact that we had in Q4 for the <unk> amplifier was relatively modest.

Speaker Change: We believe we're going to be gaining share there because we've been I would say some of the competition went out first and now we're going to be getting more of our share of those pieces.

Speaker Change: And we will see that ramp up so our amplifier business is probably in that 40% range of the overall business.

Speaker Change: So that's the main point there in terms of the <unk>.

Speaker Change: Yeah.

Speaker Change: Thank you that was very helpful.

Speaker Change: Data in terms of the.

Speaker Change: The actual size of the <unk> business compared to the total.

Speaker Change: Thank you.

Speaker Change: No.

Meta Marshall: And our next question comes from meta Marshall of Morgan Stanley. Your line is now open.

Speaker Change: Yes, I mean, the amplifier business is a little bit higher than the third it's probably in the 40% to 50% range of the E&S business.

Great. Thanks.

Meta Marshall: Maybe two questions for me one kind of appreciate kind of the EBITDA guide.

Speaker Change: Yes.

Speaker Change: Clearly cycles year to year based on just project timing.

Meta Marshall: Are there any kind of rough contextually as a sign of kind of revenue growth, that's kind of associated with that or just revenue range. We should be thinking of and then second on the next business.

Speaker Change: As we think about.

Speaker Change: The fts ample.

Speaker Change: Amplifier ramp that we're talking about in 2025.

Speaker Change: That's a pretty substantial ramp.

Speaker Change: As we.

Meta Marshall: As you look at improvement there throughout the year, how are you judging kind of pent up demand for kind of this edge.

Speaker Change: As we roll those products out.

Speaker Change: <unk>.

Speaker Change: Throughout 2025, the impact that we had in Q4 for the <unk> amplifier was relatively modest.

Meta Marshall: Fresh launch versus kind of just kind of fundamental demand coming back.

Speaker Change: And we will see that ramp up so our amplifier business is probably in that 40% range of the overall business.

Speaker Change: I'll take the second question then Carl can hit the first one.

Carl: I would say what we've really seeing here in the next business is the channel inventory build this is behind us and I would say it's back to normal growth.

Yes.

Speaker Change: Thank you that was very helpful.

Speaker Change: Thank you.

Speaker Change: And we're expecting that to be.

Meta Marshall: And our next question comes from meta Marshall of Morgan Stanley. Your line is now open.

Speaker Change: Higher single digits per year over the next few years.

Speaker Change: And then what's really helping us here is our full suite of products I mean ruckus one in Wi Fi seven are getting good traction.

Meta Marshall: Great. Thanks.

Meta Marshall: Maybe two questions for me one kind of appreciate kind of the EBITDA guide.

Speaker Change: And we're focused on growing share market share specifically in the verticals that we talked about before and I think another big important piece for US here is the investments we're going to be investing about $15 million.

Meta Marshall: Is there any kind of rough contextualize the sign of kind of revenue growth, that's kind of associated with that or just revenue range. We should be thinking of and then second on the <unk> business.

Speaker Change: Our direct sales force to improve coverage and to grow the business and we also think there's a little bit of that's going to help US is this back to office.

Meta Marshall: As you look at improvement there throughout the year, how are you judging kind of pent up demand for kind of this edge refresh launch versus kind of just kind of fundamental demand coming back.

Speaker Change: We believe there is going to be some help some help there.

Speaker Change: Yes.

Carl: I'll take the second question then Carl can hit the first one.

Speaker Change: We're not guiding to a specific revenue number.

Speaker Change: I would say, what we really seeing here in the next business is the channel inventory build is behind us and I would say it's back to normal growth.

Speaker Change: But I guess.

Speaker Change: Quantify that is on.

Speaker Change: On a year over year basis full year.

Speaker Change: We're probably talking about somewhere in the 20% growth in revenue, albeit as you know the ramp in our exit rate in 'twenty four is substantially higher than the than.

Carl: And we're expecting that to be.

Speaker Change: Higher single digits per year over the next few years.

Speaker Change: And then what's really helping us here is our full suite of products I mean ruckus one in Wi Fi seven are getting good traction.

Speaker Change: And the average that we saw in 2004.

Speaker Change: So if you just think about it it's in that 20% range of revenue growth.

Speaker Change: And we're focused on growing share market share specifically in the verticals that we talked about before and I think another big important piece for US here is the investments we're going to be investing about $15 million.

Speaker Change: Great. Thank you.

Speaker Change: Thank you.

Speaker Change: Our next question comes from Nick <unk> of Jpmorgan. Your line is open.

Speaker Change: In our direct sales force to improve coverage and to grow the business and we also think there's a little bit of that's going to help US is this back to office.

Speaker Change: Hi, This is <unk> on for Sonic.

Speaker Change: And so I think we want to pinpoint on the question on SPX amplifiers can you walk us through how you anticipate that.

Speaker Change: We believe theres going be some help some help there.

Speaker Change: Yes.

Speaker Change: We're not guiding to a specific revenue number.

Speaker Change: This rollout of SPX amplifiers, and unified amplifiers to play out in 2025.

Speaker Change: But I guess.

Speaker Change: Quantify that is.

Speaker Change: Yeah.

Speaker Change: On a year over year basis full year, we're probably talking about somewhere in the 20% growth in revenue, albeit as you know the ramp.

Speaker Change: Yeah.

Speaker Change: Well I would say we shipped in the fourth quarter, we probably shipped about $50 million worth of Mdx amplifiers and as we go into 2025.

Speaker Change: Exit rate in 'twenty, four is substantially higher than that.

Speaker Change: We're going to ship as much as $300 million.

And then the average that we saw in 2004.

Speaker Change: So if youll just think about it it's in that 20% range of revenue growth.

Speaker Change: I would say that that's not all.

Speaker Change: All incremental because they have dx could cannibalize some of the previous generation amplifier products.

Speaker Change: Great. Thank you.

Speaker Change: Thank you.

Speaker Change: It was also I think you mentioned previously like a step function chain into Q is that going to be a step function change in <unk>, that's going to be maintained throughout the rest of the year or is there.

Speaker Change: Our next question comes from Nick <unk> of Jpmorgan. Your line is open.

Speaker Change: Hi, This is priyanka Chopra for Sonic.

Speaker Change: Like some sort of differences in seasonality on that front.

Speaker Change: And so I think we want to pinpoint on the question on Fts amplifiers can you walk us through how you anticipate this.

Speaker Change: Yes, I think the.

Speaker Change: I think we will see.

Speaker Change: We will see the ramp in Q2 and Q3.

Speaker Change: We're all out of SPX amplifiers, and unified amplifiers to play out.

Speaker Change: I think we I think we will see some.

Speaker Change: In 2025.

Speaker Change: Quarterly.

Speaker Change: Quarterly fluctuations in.

Speaker Change: Yeah.

Well I would say we shipped in the fourth quarter, we probably shipped about $50 million worth of Mdx amplifiers and as we go into 2025.

Speaker Change: And just quarter to quarter as as the ramp up happens after Q2 Q3.

Speaker Change: But I think for now the way to think about it is.

Speaker Change: We're going to ship as much as $300 million.

Speaker Change: Q1 is going to remain relatively light as we ramp up production than Q2, and Q3 will be pretty strong and then I think beyond that we'll sort of see how it how it plays out with.

Speaker Change: Say that that's not.

Speaker Change: All incremental because the Dx could cannibalize some of the previous generation amplifier products.

Speaker Change: It was also I think you mentioned previously like a step function change into Q is that going to be step function change in <unk>, that's going to be maintained throughout the rest of the year or is there like some sort of differences in seasonality on that front.

Speaker Change: Our customers do the installations.

Speaker Change: Thank you.

Speaker Change: Thank you.

Speaker Change: And our next question comes from Costco.

Speaker Change: Yes, I think the I.

Speaker Change: America Your line is open.

Speaker Change: I think we will see.

Speaker Change: Hi, Thanks very much.

Speaker Change: We will see the ramp in Q2 and Q3.

Speaker Change: I wonder if.

Speaker Change: <unk>.

Speaker Change: If there is any activity or kind of thoughts.

Speaker Change: I think we I think we will see some.

Speaker Change: Quarterly.

Speaker Change: On the strategic front, so obviously that on a desk sale was very helpful in addressing.

Speaker Change: Quarterly fluctuations.

Speaker Change: And just quarter to quarter as as the ramp up happens after Q2 Q3.

Speaker Change: The debt stack.

Speaker Change: But I think there was also just ideas in other parts of your business could be attractive.

Speaker Change: But I think for now the way to think about it is.

Speaker Change: Q1 is going to remain relatively light as we ramp up production than Q2, and Q3 will be pretty strong and then I think beyond that we'll sort of see how it.

Speaker Change: First a strategic comment.

Speaker Change: A combination so wondering if there is anything that still opportunistically possible, there or has that largely died down.

Speaker Change: How it plays out with.

Speaker Change: Now that you've been able to address that problem.

Speaker Change: How our customers do the installations.

Speaker Change: Yeah.

Speaker Change: Yes, I would just say look we're really head down focused on running our business right now we're really excited about datacenter business mdx.

Speaker Change: Thank you.

Speaker Change: Thank you.

Speaker Change: And our next question comes from Costco.

Speaker Change: The new products and structured cabling.

For the first time since Colin I have been here that all three businesses are kind of now hitting on.

Speaker Change: Your line is open.

Speaker Change: Hi, Thanks very much.

Speaker Change: Hitting good stride at the same time, so we've got a lot to do here.

Speaker Change: Wonder if.

Speaker Change: If there is any activity or kind of thoughts on the strategic front. So obviously that <unk> sale was very helpful in that.

Speaker Change: Okay. Okay. Thanks very much.

Thank you I'm showing no further questions at this time I would like to turn it back to Chuck <unk> for closing remarks.

Speaker Change: Addressing.

Speaker Change: The debt stack.

Speaker Change: But I think there was also just ideas in other parts of your business could be attractive.

Chuck: Yes, I'd like to thank you all for your time today and I. Appreciate your interest in Commscope have a great rest of your week. Thank you.

Speaker Change: And other sorts of strategic comments.

Speaker Change: A combination so wondering if there is anything that still opportunistically possible, there or has that largely died down.

Chuck: This concludes today's conference call. Thank you for participating and you may now disconnect.

Speaker Change: Now that you've been able to address that problem.

Speaker Change: Yeah.

Yeah, I'd, just say look we're really head down focused on running our business right. Now we're really excited about data center business Mdx.

Speaker Change: The new products and structured cabling.

Speaker Change: For the first time since Colin I have been here that all three businesses are kind of now hitting on.

Speaker Change: Hitting good stride at the same time, so we got a lot to do here.

Speaker Change: Okay. Okay. Thanks very much.

Speaker Change: Thank you I'm showing no further questions at this time I would like to turn it back to Chuck <unk> for closing remarks.

Chuck: Yes, I'd like to thank you all for your time today and I. Appreciate your interest in Commscope have a great rescue week. Thank you.

Speaker Change: This concludes today's conference call. Thank you for participating and you may now disconnect.

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