Q4 2024 SBA Communications Corp Earnings Call

February 24, 2025

Session of the call we will give you instructions on how to enter the queue at that time with that I will now turn the call over to Mark <unk> Vice President of Finance. Please go ahead.

So the Q&A session of the call. We will give you instructions on how to enter the queue at that time with that I will now turn the call over to Mark <unk> Vice President of Finance. Please go ahead.

Speaker Change: Thank you good evening and thank you for joining us for Sba's fourth quarter 2024 earnings Conference call here with me today are Brendan Cavanagh, our President and Chief Executive Officer, and Mark Martin, Our Chief Financial Officer. Some of the information we will discuss on this call is forward looking including but not limited to any guidance for 2002.

Speaker Change: Good evening. Thank you for joining us for Sba's fourth quarter 2024 earnings Conference call with me today are Brendan Cavanagh, our President and Chief Executive Officer, and Mark Martin, Our Chief Financial Officer. Some of the information we will discuss in this call is forward looking including but not limited to any guidance for 2010.

Five and beyond.

Speaker Change: In today's press release and in our SEC filings, we detailed material risks that may cause our future results to differ from our expectations. Our statements are as of today February 24th and we have no obligation to update any forward looking statement, we may make.

Speaker Change: In today's press release and in our SEC filings, we detailed material risks that may cause our future results to differ from our expectations. Our statements are as of today February 24, and we have no obligation to update any forward looking statements we may make.

Speaker Change: In addition, our comments will include non-GAAP financial measures and other key operating metrics a reconciliation of and other information regarding these items can be found on our supplemental financial data package, which is located on the landing page of our Investor Relations website.

Speaker Change: In addition, our comments will include non-GAAP financial measures and other key operating metrics. The reconciliation of and other information regarding these items can be found on our supplemental financial data package, which is located on the landing page of our Investor Relations website.

As part of an ongoing effort to improve our earnings materials, we have made certain modifications to the supplemental financial data package and we will be providing the materials in both ETF and excel form.

Speaker Change: As part of an ongoing effort to improve our earnings materials, we have made certain modifications to the supplemental financial data package and will be providing the materials and both <unk> and <unk> for them.

Speaker Change: Note the revised package does not exclude any previously provided financial or operating metrics.

Speaker Change: Note the revised package does not exclude any previously provided financial operating metrics.

Brent: With that I'll now turn the call over to Brent.

Brendan Cavanagh: With that I'll now turn the call over to Brendan.

Brent: Thank you Mark and good afternoon.

Brendan Cavanagh: Thank you Mark and good afternoon.

Brent: The fourth quarter was a solid finish to the year.

Brendan Cavanagh: The fourth quarter with a solid finish to the year.

Brent: <unk> for the quarter were in line to slightly ahead of our estimates even with worse than assumed foreign exchange rates.

Brendan Cavanagh: <unk> for the quarter were in line to slightly ahead of our estimates even with worse than assumed foreign exchange rates.

Brent: Domestic new carrier activity or bookings continued to increase sequentially from the third quarter.

Domestic new carrier activity or bookings continued to increase sequentially from the third quarter.

Brent: The shift in the makeup of our new business also continued with a higher percentage coming from new lease co locations versus amendments to existing leases.

Brendan Cavanagh: The shift in the makeup of our new business also continued the higher percentage coming from new lease co locations versus amendments to existing leases.

Brent: Our carrier customers continue to expand their <unk> mid band coverage, including adding capacity for fixed wireless access as well as extend network coverage into areas of the country that have little to no cell coverage today.

Brendan Cavanagh: Our carrier customers continue to expand their <unk> mid band coverage, including adding capacity for fixed wireless access as well as extend network coverage into areas of the country that have little to no cell coverage today.

Brent: Even with increased bookings in the quarter, our leasing application backlogs grew throughout the quarter and finished at the highest level of the year.

Brendan Cavanagh: Even with increased bookings in the quarter, our leasing application backlogs grew throughout the quarter and finished at the highest level of the year.

Brent: And our U S based services business had its best quarter of the year as well.

And our U S based services business had its best quarter of the year as well.

Brent: The beginning of 2025 is also off to a strong start suggesting another quarter over quarter increase in new leasing business to begin this year and our 2025 services outlook contemplates a year over year increase in that business.

Brendan Cavanagh: The beginning of 2025 is also off to a strong start.

Brendan Cavanagh: Just another quarter over quarter increase in net debt to begin this year.

Brendan Cavanagh: Our 2025 services outlook contemplates a year over year increase in that business.

Brent: Our U S customers are busy and we expect to be a key partner to them. This year in support of their network goals.

Brendan Cavanagh: Our U S customers are busy and we expect to be a key partner to them. This year in support of their network goals.

Brent: Internationally, our fourth quarter results were in line with expectations as our customers continue to invest in their networks and almost all of our international markets. The mobile network operators are well behind the U S. In terms of <unk> coverage. So we anticipate continued network investment to close that gap and to broadly expand coverage to.

Brendan Cavanagh: Internationally, our fourth quarter results were in line with expectations as our customers continued to invest in their networks and almost all of our international markets. The mobile network operators are well behind the U S. In terms of <unk> coverage.

Brendan Cavanagh: We anticipate continued network investment to close that gap and to broadly expand coverage to underserved areas.

Brent: Underserved areas.

Brent: In many ways wireless is an even more critical service in our international markets than in the U S.

Brendan Cavanagh: In many ways wireless is an even more critical service in our international markets than in the U S.

Brent: International churn Unfortunately continues to be elevated largely due to customer consolidations and we are working closely with our customers to help them achieve necessary network efficiencies.

Brendan Cavanagh: International churn Unfortunately continues to be elevated largely due to customer consolidations and we are working closely with our customers to help them achieve necessary network efficiencies we.

Brent: We believe the surviving customers will be stronger and better positioned for ongoing investments and ultimately will support greater stabilization in our international cash flows.

Brendan Cavanagh: We believe the surviving customers will be stronger and better positioned for ongoing investments and ultimately will support greater stabilization in our international cash flows.

Brent: Overall 2024 was a successful year, while our stock performance was hindered by the headwinds of the macro interest rate environment and a strong dollar we had several accomplishments that set us up well for the future.

Brendan Cavanagh: Overall 2024 was a successful year, while our stock performance was hindered by the headwinds of the macro interest rate environment and a strong dollar we had several accomplishments that set us up well for the future.

Brent: Operationally, we expanded and strengthened our relationships with our largest customers. We grew our leasing and services backlogs refreshed our mission vision and values and streamlined a number of our operations and processes.

Brendan Cavanagh: Operationally, we expanded and strengthened our relationships with our largest customers. We grew our leasing and services backlogs refreshed our mission vision and values and streamlined a number of our operations and processes.

Brent: With regard to capital allocation, we invested over $550 million in asset acquisitions stock repurchases and new tower builds all while growing our dividend at an industry leading 15%.

Brendan Cavanagh: With regard to capital allocation, we invested over $550 million in asset acquisitions stock repurchases and new tower builds all while growing our dividend at an industry leading 15%.

Brent: We also improved our balance sheet and liquidity position.

We also improved our balance sheet liquidity position.

Brent: In the beginning of the year, we refinanced our $2 3 billion term loan pushing out the maturity to 2031.

Brendan Cavanagh: In the beginning of the year, we refinanced our $2 3 billion term loan pushing out the maturity to 2031.

Brent: Extended the maturity of our revolving credit facility and increased it from $1 5 billion to $2 billion.

Brendan Cavanagh: We extended the maturity of our revolving credit facilities and increased $1 5 billion to $2 billion.

Brent: And subsequently entered into a forward starting interest rate hedge reducing our future floating rate interest exposure and locking in a much lower rate than can be achieved today.

Brendan Cavanagh: And subsequently entered into a forward starting interest rate hedge reducing our future floating rate interest exposure and locking in a much lower rate than can be achieved today.

Brent: In addition in October we refinanced $2 $1 billion of tower securities at rates, well below where those same securities with price today.

Brendan Cavanagh: In addition in October we refinanced $2 $1 billion of tower securities at rates, well below where those same securities with price today.

Brent: We ended the year at six one times net debt to adjusted EBITDA, the lowest level in our history.

Brendan Cavanagh: We ended the year at six one times net debt to adjusted EBITDA, the lowest level in our history.

In February of last year, I laid out my strategic priorities, focusing mostly on ways to enhance the portfolio with the goal is to stabilize results grow the core business and improve the overall quality of our assets be it through inorganic growth or new agreements with our customers.

Brendan Cavanagh: In February of last year, I laid out my strategic priorities, focusing mostly on ways to enhance the portfolio with the goals to stabilized results grow the core business and improve the overall quality of our assets.

Brendan Cavanagh: Be it through inorganic growth or new agreements with our customers.

Brent: While we still have work to do we made major strides toward these goals.

Brendan Cavanagh: While we still have work to do we made major strides toward these goals.

Brent: As announced last quarter, we entered into an agreement to purchase approximately 7000 towers for millicom in Central America.

Brendan Cavanagh: As announced last quarter, we entered into an agreement to purchase approximately 7000 towers for millicom in Central America. This.

Brent: This immediately accretive transaction positions SBA as the leading operator in the region with over 10500 pro forma sites.

This immediately accretive transaction positions SBA as the leading operator in the region with over 10500 pro forma sites.

Brent: Beyond just the absolute size and scale. This deal aligns us with one of the leading <unk> in the market under long term U S dollar denominated lease agreements.

Brendan Cavanagh: Beyond just the absolute size and scale. This deal aligns us with one of the leading <unk> in the market under long term U S dollar denominated lease agreements.

Brent: We also entered into a significant build to suit agreement with millicom that we expect will drive growth and further improve our position in the region for years to come.

Brendan Cavanagh: We also entered into a significant build to suit agreement with millicom that we expect will drive growth and further improve our position in the region for years to come.

Brent: In fact, our 2025 outlook incorporates the planned level of up to 800, New tower builds this year the largest number for SBA in over 20 years with the majority of those in Central America.

Brendan Cavanagh: In fact, our 2025 outlook incorporates the planned level of up to 800, New tower builds this year the largest number for SBA in over 20 years with the majority of those in Central America.

Brent: Needless to say, we're excited about this transaction and its contributions to our future growth and stability.

Brendan Cavanagh: Needless to say, we're excited about this transaction and its contributions to our future growth and stability.

Brent: Alternatively, when we are in a subscale position and don't see a path to scale or other potential limitations on our markets future performance, we will look to exit those markets.

Speaker Change: Alternatively, when we are in a subscale position and don't surpassed to scale or other potential limitations on our markets future performance, we will look to exit those markets.

Brent: Like we did in Argentina back in the fourth quarter of 2023, we officially exited the Philippines in January and today. We've also announced we are under agreement to sell our operations in Colombia.

Speaker Change: I think we did in Argentina back in the fourth quarter of 2023, we officially exited the Philippines in January and today. We've also announced we are under agreement to sell our operations in Colombia.

Brent: Columbia market represents less than 200 sites and the impact to the financials are immaterial.

Speaker Change: Columbia market represents less than 200 sites and the impact of the financials are immaterial.

Brent: It is not our desire to exit markets. In fact, it was much more a preference to find ways to scale aligning with leading carriers and driving returns. We will continue to look for ways to do just that across our remaining markets.

Speaker Change: It is not our desire to exit markets and factor is much more a preference to find ways to scale aligning with leading carriers and driving returns. We will continue to look for ways to do just that across our remaining markets.

Brent: Each of the steps taken over the past year will help our teams to be better focus and better positioned to maximize new business opportunities.

Speaker Change: Each of the steps taken over the past year will help our teams to be better focused and better positioned to maximize new business opportunities.

Brent: Looking at 2025 and beyond the key growth drivers remain intact mobile.

Speaker Change: Looking at 2025 and beyond the key growth drivers remain intact.

Brent: Mobile network consumption continues to grow and limited new spectrum availability means more equipment at the cell site.

Speaker Change: Mobile network consumption continues to grow and limited new spectrum availability means more equipment at the cell site.

Brent: Fixed wireless access the incorporation of Nexgen AI applications in handsets regulatory build out requirements and remaining <unk> coverage expansion.

Speaker Change: Fixed wireless access the incorporation of Nexgen AI applications in handsets regulatory build out requirements and remaining <unk> coverage expansion or are expected to contribute to ongoing network investments.

Brent: <unk> are expected to contribute to ongoing network investments.

Brent: The strength of our balance sheet and the significant free cash flow that we generate every year will allow us to continue investing in high quality, new assets as well as shareholder remuneration through industry, leading dividend growth and share repurchases.

Speaker Change: The strength of our balance sheet and the significant free cash flow that we generate every year will allow us to continue investing in high quality, new assets as well as shareholder remuneration through industry, leading dividend growth and share repurchases.

Brent: We are optimistic about our future opportunities.

Speaker Change: We are optimistic about our future opportunities.

Mark Martin: Before turning it over to Mark I'd like to thank our team members the company's ability to achieve our vision to be our customers' first choice provider in the industry leader in quality infrastructure solutions is only possible because of the incredibly hard working team members we have here at SBA.

Speaker Change: Before turning it over to Mark I'd like to thank our team members the companys ability to achieve our vision to be our customers' first choice provider in the industry leader in quality infrastructure solutions is only possible because of the incredibly hard working team members we have here at SBA.

Mark Martin: I'd also like to thank our customers for their trust in us and we look forward to collaborating with them to achieve their network goals and with that I'll now turn things over to Mark who will provide additional details.

Speaker Change: I'd also like to thank our customers for their trust in us and we look forward to collaborating with them to achieve their network goals and with that I'll now turn things over to Mark will provide additional details.

Mark Martin: Brendan fourth quarter domestic organic revenue growth over the fourth quarter of last year was 1% on a gross basis and two 2% on a net basis, including two 9% of churn.

Brendan Cavanagh: Brendan fourth quarter domestic organic revenue growth over the fourth quarter of last year was five 1% on a gross basis and two 2% on a net basis.

Speaker Change: <unk> two 9% of churn.

Mark Martin: In the quarter.

Mark Martin: Approximately $8 5 million or new leases and amendments billings.

Speaker Change: In the quarter.

Speaker Change: Approximately <unk> 5 million, new leases and amendments buildings.

Mark Martin: With respect to the two 9% of churn one 6% was related to spring consolidation were approximately $7 million.

Speaker Change: With respect to the 49% of churn one 6% related to consolidations were approximately $57 million.

Mark Martin: Year over year International organic work.

Speaker Change: Year over year International organic work recurring cash leasing revenue growth for the fourth quarter.

Mark Martin: <unk> cash leasing revenue growth for the fourth quarter.

<unk> created on a constant currency basis was one 7% including.

Scott: Scott could even on a constant currency basis was one 7% net income.

Mark Martin: Including 6% of churn was seven 7% on a gross basis.

Scott: Including 6% of churn was seven 7% on a gross basis.

Mark Martin: In Brazil, our largest international market.

Scott: In Brazil, our largest international market.

Mark Martin: So again <unk> was eight 7% on a constant currency basis.

Scott: This organic growth was eight 7% constant currency basis.

Mark Martin: International churn remain elevated in the fourth quarter due mostly to previously announced kiosks constant ambition.

Scott: Our international insurance remained elevated in the fourth quarter due mostly to previously announced consolidation.

Mark Martin: The fourth quarter consolidated cash site leasing revenue and adjusted EBITDA denominated in U S dollars with 78% at <unk>, 1% respectively.

Scott: During the fourth quarter consolidated cash site leasing revenue and adjusted EBITDA denominated in U S dollars was 78% 80.

Scott: 1% respectively.

Mark Martin: The majority of non U S. Dollar denominated revenue was from Brazil, with Brazil, representing 15, 6% of conserving cash site leasing revenues during the quarter.

Scott: The majority of non U S. Dollar denominated revenue was from Brazil, with Brazil, representing 15, 6% of consolidated cash site leasing revenues during the quarter.

Mark Martin: These earnings press release includes.

Scott: These earnings press release includes initial.

Mark Martin: The initial 2025 outlook domestically also reflects both the lower level of carrier bookings, we experienced in 2024 and our expectation for increased activity for our 2025.

Scott: Initial 2025 outlook.

Scott: <unk> also reflects both the lower level of bookings, we experienced in 2024 and our expectation for increased activity throughout 2025.

Mark Martin: We're guiding to a range of $35 million to $39 million from new leases and amendments.

Scott: We're guiding to a range of $35 to $39 million from new leases and amendments.

Mark Martin: The <unk> also assumed range of $50 million to $52 million related to sprint churn and $20 million to $22 million regular churn.

Scott: The <unk> also assumed a range of $50 million to $52 million related to spring <unk> and 2000 $22 million for regular Truman.

Mark Martin: Our previously provided estimate of aggregate screen really churn over the next several years remains largely unchanged as an estimate of approximately $50 million in 2026.

Scott: Our previously provided estimate of aggregates.

Scott: <unk> churn over the next several years remains largely unchanged as an estimate of approximately 50 million in 2026.

Mark Martin: Approximately $20 million thereafter.

Scott: Approximately $20 million thereafter.

Speaker Change: For our international segment outlook, we said.

Scott: Our international segment also reflect the network investment.

Speaker Change: <unk> network investment Guardian, two ratio of $16 million to $18 million for new leases and amendments.

Scott: <unk> ratio of $16 million to $18 million for new leases and amendments.

Speaker Change: <unk> assume a range of $27 million to $31 million related to churn.

Scott: <unk> assume a range of $27 million to $31 million or related to churn.

Speaker Change: <unk> continues to be elevated as we work through Kyoto consolidations, some carrier bankruptcies or restructurings and Warren as operators network virtualization.

Scott: <unk> continues to be elevated as we work through theory consolidations.

Scott: Bankruptcies or restructurings.

Scott: <unk> operator <unk> mutations.

Speaker Change: We are working with our carrier customers to many months trends over the long term.

Scott: We are working with our carrier customers to minimize churns over the long term.

Speaker Change: Additionally, FX continued to be a headwind and we're guiding to a negative $25 million or year over year impact from FX on site leasing revenue.

Scott: Then this story.

Scott: We continue to be a headwind and more guiding to a negative $25 million or <unk> impact from FX on site leasing revenue.

Speaker Change: Turning to services, we will guide to a range of $160 million to $180 million growing revenue, reflecting increased carrier activity youre seeing at all our sites to date.

Scott: Turning to services, we will guide to a range of $160 million to $180 million revenue, reflecting the increased activity youre seeing at all our sites.

We saw a meaningful increase in activity in the second half of 2024, and we expect to see similar level throughout 2025.

We saw a meaningful increase in activity in the second half of 2024, and we expect to see similar levels throughout 2025.

Speaker Change: Outlook, assuming this BD closing date of September fluids for the previously announced medical conduction contributing approximately $42 million to cash site leasing revenue and <unk> 9 million to our cash flow to 2020.

Speaker Change: Are you assuming in CBD closing date of September 1st for the previously announced medical transaction.

Speaker Change: <unk> approximately $42 million cash site leasing revenue and $29 million or cash flows towards 2020.

Speaker Change: The ultimate cruising data is dependent upon regulatory approval and an although requirement and the differ from this date.

Speaker Change: The ultimate closing date is dependent upon regulatory approval, although requirements and the disciplined from the date.

Speaker Change: Please also note that the outlook business human further acquisitions beyond those which as of today onto contract and expect to close by year end.

Speaker Change: Please also note that the outlook does not assume any further acquisitions beyond those reach as of today onto contract and expected to close by year end.

Speaker Change: We also do not assume any share repurchase in the outlook. However, it is possible when we invest in additional asset will share repurchase or both during the year.

Speaker Change: We also do not assume any share repurchase outlook. However, it is possible when dosed, an additional asset will share repurchase or both during the year.

Speaker Change: I will now turn the call over to Mark we'd provide additionally, thanks.

Mike: I will now turn the call over to Mike will provide additional.

Speaker Change: Thanks, Mark as we previously announced on our third quarter call in October of last year. The company issued through an existing trust two tranches of tower revenue Securities for a total of 2.07 billion.

Speaker Change: Mark as we previously announced on our third quarter call October of last year. The company issued through an existing trust two tranches of tower revenue Securities.

Mike: A 2.07 billion.

Speaker Change: Which included a tranche of 620 million issued at four six by 4% with an anticipated repayment date of October 2027, and a final maturity date of October 2054.

Mike: Which included a tranche of $620 million issued at four 654%.

Mike: With an anticipated repayment date of October 2027, and a final maturity date of October 2054.

Speaker Change: We also issued a tranche of 145 billion issued at four 831% with anticipated repayment date of October 2029, and a final maturity date of October 2054.

Mike: We also issued a tranche of 145 billion issued at 481% with an anticipated repayment date of October 2029, and a final maturity date of October 2054.

Speaker Change: Our next maturity is $750 million ABS notes due January 2026, our current leverage is six one times net debt to adjusted EBITDA and fourth quarter net cash interest coverage ratio of adjusted EBITDA to net cash interest expense was very strong at five five times, our weighted average maturity.

Mike: Our next maturity is $750 million ABS notes due January 2026.

Mike: Current leverage is six one times net debt to adjusted EBITDA in fourth quarter net cash interest coverage ratio of adjusted EBITDA to net cash interest expense was very strong at five five times.

Speaker Change: It's approximately three four years with an average interest rate of three 2% across our total outstanding debt as of today, our $2 billion revolver remains fully undrawn.

Mike: Our weighted average maturity is approximately three four years with an average interest rate of three 2% across our total outstanding debt as of today, our $2 billion revolver remains fully undrawn during.

Speaker Change: During the fourth quarter, we declared and paid a cash dividend of $105 4 million or <unk> 98 per share.

Mike: During the fourth quarter, we declared and paid a cash dividend of $105 4 million or <unk> 98 per share and <unk>.

Speaker Change: Today, we announced that our board of directors declared a first quarter dividend of $1 11 per share payable on March 27, 2025 to shareholders of record as of the close of business on March 13th 2025. This dividend represents an increase of approximately 13% over the dividend paid in the fourth quarter of 2024.

Mike: We announced that our board of directors declared a first quarter dividend of $1 11 per share payable on March 27, 2025 to shareholders of record as of the close of business on March 13, 2025. This dividend represents an increase of approximately 13% over the dividend paid in the fourth quarter of 2024.

Speaker Change: And approximately 35% of the midpoint of our full year <unk> outlook and with that operator, we are ready to turn the call over to questions.

Mike: And approximately 35% at the midpoint of our full year <unk> outlook and with that operator, we are ready to turn the call over to questions.

Speaker Change: Thank you very much ladies and gentlemen, as we move onto Q&A. Please style pound too on your telephone keypad to be placed in the question queue Hulio a notification when it's your turn to ask a question at that point your line will be uneven.

Speaker Change: Thank you very much ladies and gentlemen, as we move onto Q&A. Please style pound too on your telephone keypad to be placed in the question queue.

Speaker Change: Julie or notification when it's your turn to ask a question at that point.

Speaker Change: Your line will be unloaded.

Speaker Change: Okay, and let's go ahead and go to our first caller <unk> Levi from UBS.

Speaker Change: Okay, and let's go ahead and go to our first caller <unk> Lee from UBS.

Speaker Change: Great. Thank you.

Levi: Can you tell a bit more color on the increase in the backlog that youre seeing right now do you see that coming from increased applications from a specific tenant or is it more broad across Europe.

Speaker Change: Can you put a bit more color on the increase in the backlog that youre seeing right now do you see that coming from increased applications from a specific tenant or is it more broad across your all your tenants and maybe some color in terms of how should we think about the book to bill cycle to be with Colocation.

Levi: Our tenants and maybe some color in terms of how should we think about the book to bill cycle to be with co location, increasing I know you just guided for 'twenty five, but if we assume it's a backend loaded year is it fair to assume you have good visibility for U S leasing to be up next year. Thank you.

Speaker Change: Increasing I know you just guided for 'twenty five, but if we assume it's a backend loaded year is it fair to assume you have good visibility for U S leasing to be up next year. Thank you.

Levi: Yes, so that the mix in terms of the backlog I would say its fairly broad it's not exactly the same for each carrier.

Speaker Change: Yes, so the mix in terms of the backlog I would say its fairly broad it's not exactly the same for each carrier.

Levi: Certain ones that are perhaps a little busier than others, but generally speaking, they're all up in terms of the.

Speaker Change: Certain ones that are perhaps a little busier than others, but generally speaking, they're all up in terms of the.

Levi: The applications that are coming in.

Speaker Change: The applications that are coming in.

Levi: And there are more as we mentioned in our prepared comments there definitely are more.

Speaker Change: And there are more as we mentioned in our prepared comments there definitely are more.

Levi: There is more business coming from new leases relative to amendments to existing leases like we've seen in the past and so.

Speaker Change: There's more business coming from new leases.

Speaker Change: Relative to amendments to existing leases like we've seen in the past.

Levi: Shifts in the mix of the type of.

Speaker Change: Gift and the mix of the type of.

Levi: New bookings that we're seeing will drive the book to Bill cycle to be later, and therefore, we would expect to see growth.

Speaker Change: New bookings that we're seeing will drive the book to Bill cycle to be later, and therefore, we would expect to see growth.

Levi: <unk> over quarter throughout this year in terms of the contributions domestically from new leases and amendments and so yes, I think that generally speaking would be favorable to next year, but its certainly a little little premature to be talking about what next year's number is going to look like let's see how this year plays out but our expectation is we'll see growth move up as we move.

Speaker Change: Quarter over quarter throughout this year in terms of the contributions domestically from new leases and amendments and so yes, I think that generally speaking would be favorable to next year, but its certainly a little a little premature to be talking about what next year's number is going to look like let's see how this year plays out but our expectation is we'll see growth move up as well.

Levi: Through the year.

Speaker Change: Sounds good thank you.

Speaker Change: Move through the year.

Speaker Change: Sounds good thank you.

Levi: Sure.

Speaker Change: Alright, moving on to our next caller, Jim Schneider Goldman Sachs.

Speaker Change: Sure.

Speaker Change: Alright, moving on to our next caller, Jim Schneider Goldman Sachs.

Jim Schneider: Good afternoon, and thanks for taking my question.

Jim Schneider: Many of your carrier customers in the U S, having sort of given our multiyear outlook for Capex, which is sort of consistent with what we've seen over the past couple of years.

Jim Schneider: Steve your carrier customers in the U S, having sort of given our multiyear outlook for Capex, which is <unk>.

Jim Schneider: Consistent with what we've seen over the past couple of years.

Jim Schneider: How should we think about your ability to sort of grow domestic leasing in the out years relative to this year's guidance.

Jim Schneider: Should we think about your ability to sort of grow domestic leasing in the out years relative to this year's guidance.

Jim Schneider: Budgets remain where they are and maybe what are some of the areas that would allow you to sort of outperform.

Jim Schneider: Overall capex growth envelope.

Jim Schneider: Those overall capex growth envelope.

Jim Schneider: Whether its densification fixed wireless or otherwise.

Jim Schneider: Yes, Jim I mean, the carriers, obviously have very large capex budgets and so.

Jim Schneider: What would probably be relatively minor shifts in the mix or makeup of those capex budgets can have a more meaningful impact on us and so.

Jim Schneider: What would probably be relatively minor shifts in the mix or makeup of those capex budgets can have a more meaningful impact on us and so I'm.

Jim Schneider: I'm not too concerned about their overall capex budgets being relatively flat because what were seeing on the ground is a lot more activity around.

Jim Schneider: Im not too concerned about their overall capex budgets being relatively flat because what were seeing on the ground is a lot more activity around the.

Jim Schneider: The wireless networks and specifically at a macro based networks. So.

Jim Schneider: <unk> wireless networks, and specifically at a macro based networks.

Jim Schneider: No.

Jim Schneider: As I look out into the future.

Jim Schneider: No.

Jim Schneider: As I look out into the future.

Jim Schneider: Can only see what's happening now and what theyre, telling us today and that suggests.

Jim Schneider: Can only see what's happening now and what they are telling us today and that suggests.

Jim Schneider: A lot more activity and I think actually the lack of incremental spectrum being added to the mix means that they have to make sure that what they have stretches farther and I think that's actually going to turn out to be decent for us in terms of our planning in the next couple of years.

Speaker Change: Thanks, and then Brendan just to follow up on that I believe in your opening script. You mentioned that you saw demand specifically for fixed wireless compounding capacity additions can you maybe clarify whether that is fixed wireless capacity above and beyond or are completely separate from conventional mobile capacity.

Speaker Change: Thanks, and then and then Brendan just to follow up on that I believe your opening script. You mentioned that you saw demand specifically for fixed wireless competitive capacity additions can you maybe clarify whether that is fixed wireless capacity above and beyond or are completely separate from conventional mobile capacity.

Speaker Change: Or maybe any color on where that is happening it would be helpful. Thank you.

Jim Schneider: Or maybe any color on where that is happening it would be helpful. Thank you.

Speaker Change: Yes.

Speaker Change: Honestly, it's a little bit hard to distinguish from what we see going on to the sites in terms of.

Jim Schneider: Yeah, I mean honestly, it's a little bit hard to distinguish from what we see going on to the sites in terms of.

Speaker Change: Basic <unk> mobile capacity versus fixed wireless access.

Jim Schneider: Basic <unk> mobile capacity versus fixed wireless access.

Speaker Change: But what we are hearing is.

Jim Schneider: But what we are hearing is.

Speaker Change: In our conversations with the carriers on the ground.

Jim Schneider: In our conversations with with the carriers on the ground.

Speaker Change: It is a meaningful driver of the incremental investment in some of these locations. So what I'm, giving you I guess I would characterize as anecdotal but.

Jim Schneider: It is a meaningful driver of the incremental investment in some of these locations. So what I'm, giving you I guess I would characterize as anecdotal but.

Speaker Change: We're definitely seeing the increased activity and so we mentioned that because it is one of the drivers that we hear from our customers as to the increased investment that they're making but I think it's probably in all of the above type of thing ultimately.

Jim Schneider: We're definitely seeing the increased activity and so we mentioned that because it is one of the drivers that we hear from our customers is the increased investment that they're making but I think it's probably in all of the above type of thing ultimately.

Speaker Change: Great. Thank you.

Jim Schneider: Great. Thank you.

Speaker Change: Alright, before we move on to our next caller I just wanted to remind everyone that if you'd like to ask a question. Please dial pound too on your telephone keypad to be placed in the queue alright lets move on to our next caller match Knickman from Deutsche Bank.

Jim Schneider: All right before we move on to our next caller I just wanted to remind everyone that if you'd like to ask a question. Please dial.

Jim Schneider: And two on your telephone keypad to be placed in the queue alright lets move on to our next caller, Matt Knickman from Deutsche Bank.

Match Knickman: Hey, thanks, so much for taking the question.

Matt Knickman: Hey, thanks, so much for taking the question.

Match Knickman: Two if I could first on the leasing outlook for 'twenty five maybe Brendan if there is any commentary you can offer up in terms of what's baked in for customer specific activity across the three nationals and dish and then secondly on the services outlook. So the guidance for $1 60 to 180.

Matt Knickman: Two if I could first on the leasing outlook for 'twenty five maybe Brendan if there's any commentary you could offer up.

Matt Knickman: In terms of what's baked in for customer specific activity across the three nationals in dish.

Matt Knickman: And then just secondly on the services outlook, so the guidance for $160 million to $180 million, it's a little bit shy of the annualized exit rate from <unk>.

Speaker Change: It's a little bit shy of the annualized exit rate from <unk>. If you just annualize the fourth quarter number it implies closer to 190, and so I'm just wondering if there were any one timers in the fourth quarter or if you're assuming any sort of moderation from any customers next year. Thanks.

Matt Knickman: Just annualize the fourth quarter number it implies closer to $1 90, and so I'm just wondering if there were any one timers in the fourth quarter or if you're assuming any sort of moderation from any customers next year. Thanks.

Speaker Change: Sure, Yes, so on the second one first there is no one timers in the fourth quarter.

Matt Knickman: Sure Yeah. So on the second one first there is no one timers in the fourth quarter.

Speaker Change: I think.

Speaker Change: What we're giving you is based on what we have in our backlog today and the conversations we're having with the carriers. The services guidance is a little bit harder to be completely precise on when you look out for the full year at this stage of the year, because it's not a long term contractual cycle. The way. It is in the leasing business. So as you get to.

Matt Knickman: Thank.

Matt Knickman: What we're giving you is based on what we have in our backlog today and the conversations we're having with the carriers.

Matt Knickman: <unk> guidance is a little bit harder to be completely precise on when you look out for the full year at this stage of the year, because it's not a long term contractual cycle. The way. It is in the leasing business. So as you get to the second half of the year, we tend to take.

Speaker Change: The second half of the year, we tend to take.

Speaker Change: Just a slight bit of conservatism in our approach to the back half of the year. So I don't think theres anything really that you should read into that Matt.

Matt Knickman: Perhaps a slight bit of conservatism in our approach to the back half of the year. So I don't think there's anything really that you should read into that Matt.

Speaker Change: In terms of against the fourth quarter of last year on the leasing outlook.

Matt Knickman: In terms of against the fourth quarter of last year on the leasing outlook.

Speaker Change: Yes, I mean, we prefer to stay away from too much detail on a customer specific basis as I as I mentioned in an answer to a previous.

Matt Knickman: Yes, I mean, we prefer to stay away from too much detail on a customer specific basis as I as I mentioned in an answer to a previous.

Speaker Change: Question, we're seeing each of the big three carriers.

Matt Knickman: Question, we're seeing each of the big three carriers.

Speaker Change: Increase their activity levels and so they are all contributing to that we do have.

Matt Knickman: Increase their activity levels, and so theyre all contributing to that we do have Conor.

Speaker Change: Contributions from certain carriers that have regulatory obligations.

Matt Knickman: Contributions from certain carriers that have regulatory obligations.

Speaker Change: For coverage and download downlink speeds.

Matt Knickman: For coverage and download downlink speeds.

Speaker Change: That are driving a big percentage of the activity that we're seeing so in one particular case, that's the main driver, but but really they're all busier. So I would say among the big three that's the case and as it relates to dish.

Matt Knickman: That are driving a big percentage of the activity that we're seeing so in one particular case that is the main driver, but but really they are all busier. So I would say among the big three that's the case and as it relates to dish.

Speaker Change: We're not seeing nearly as much as we have in the past that's a much much lesser contribution.

Matt Knickman: We're not seeing nearly as much as we have in the past so that's a much much lesser contribution.

Speaker Change: Thank you.

Speaker Change: Sure.

Matt Knickman: Thank you.

Matt Knickman: Sure.

Speaker Change: Okay moving onto Richard Choe Jpmorgan.

Matt Knickman: Okay.

Matt Knickman: Okay moving onto Richard Choe Jpmorgan.

Speaker Change: Hi.

Matt Knickman: Hi.

Speaker Change: Alright, I just wanted to follow up on the mix of business I assume still kind of have a heavier.

Richard Choe: Hi, just wanted to follow up on the mix of business I assume still kind of heavier.

Speaker Change: Amendments versus co Lo, but by then the year do you see that as being more even or actually even more colo.

Richard Choe: Amendment versus Colo, but by the end of the year do you see that being more even or actually even more colo.

Speaker Change: Yes, it's actually we're actually seeing in terms of dollars.

Richard Choe: Yeah, it's actually we're actually seeing in terms of dollars.

Speaker Change: More and this is the U S. We're talking about specifically, but we're seeing greater contribution from Carlos today versus amendments historically, it's obviously been amendments predominantly but that has.

Richard Choe: More and this is the U S. We're talking about specifically, but we're seeing greater contribution from co lows today versus amendments historically, it's obviously been amendments predominantly but that has happened.

Speaker Change: Happened in terms of that shift at least on a dollar basis, the number of agreements because the amendments or lesser dollars tend to still favor the amendments.

Richard Choe: It happened in terms of that shifts at least on a dollar basis, the number of agreements because the amendments or lesser dollars tend to to still favor the amendments.

Speaker Change: And then you have spring trend this year and some next year is there any kind of positioning in terms of maybe wanting to get that all into this year at some point or is it still just kind of.

Richard Choe: And then you have spring trend this year and some next year is there any kind of positioning in terms of maybe wanting to get that all into this year at some point or is it still just kind of.

Speaker Change: Waiting for it to roll off.

Richard Choe: Waiting for it to roll off.

Speaker Change: Yes, Richard I mean at this stage most of this year sprint churn is stuff that's frankly.

Richard Choe: Yeah.

Speaker Change: Yes, Richard I mean at this stage most of this year's fringe churn is stuff that frankly.

Speaker Change: Happened or just about to happen in some cases.

Richard Choe: Already happened or just about to happen in some cases.

Speaker Change: And this is the financial impact of it is what's in our numbers for this year and when you look at next year, which is the last big year. Most of the impact of that will be driven by leases that expired right towards the end of this year or the beginning of next year and so there's really not that much time to try and pull something in in order to do.

Richard Choe: And this is the financial impact of it is what's in our numbers for this year and when you look at next year, which is the last big year. Most of the impacts of that will be driven by leases that expire right towards the end of this year or the beginning of next year and so there's really not that much time to try and pull something in in order to do.

Speaker Change: That you would expect I think that T. Mobile would expect some sort of balance in that but there is something in that for them, if they're going to pay it off early so.

Richard Choe: That you would expect I think that T. Mobile would expect some sort of balance in that but there is something in that for them, if they're going to pay it off early so.

Speaker Change: Yes.

Speaker Change: The quick answer is I don't I don't think that's likely to occur.

Richard Choe: No.

Richard Choe: The quick answer is I don't I don't think that's likely to occur.

Speaker Change: In terms of accelerating but at this stage.

Richard Choe: In terms of accelerating but at this stage, where we're down to the final years of the material impact so I.

Speaker Change: We're down to the final years of the material impact so.

Speaker Change: I think everybody knows what it is at this stage.

Richard Choe: I think everybody knows what it is at this stage.

Speaker Change: Great. Thank you.

Speaker Change: Sure.

Richard Choe: Great. Thank you.

Speaker Change: Okay, moving on to Michael Rollins from Citigroup.

Richard Choe: Sure.

Richard Choe: Okay, moving on to Michael Rollins from Citigroup.

Speaker Change: Thanks, and good afternoon.

Richard Choe: Thanks, and good afternoon to.

Speaker Change: Two questions first one if I could follow up on the last one.

Richard Choe: Two questions.

Richard Choe: First of all if I could follow up on the last one.

Speaker Change: As the merger churn is picking up in the U S is there a corresponding increase in fees for carriers, leading the equipment behind and is that something that could be a significant contributor whether its this year or over the next few years as you kind of wrap up some of this merger churn and then sell.

Speaker Change: As the merger churn is picking up in the U S is there a corresponding increase in fees for carriers, leading the equipment behind and is that something that could be a significant contributor whether its this year for over the next few years as you kind of wrap up some of this merger churn and then <unk>.

Speaker Change: Just maybe taking a step back on capital allocation. If you can give us an update on.

Speaker Change: How youre thinking about your target debt leverage and priorities for capital. Thanks.

Speaker Change: How youre thinking about your target debt leverage and the priorities for capital. Thanks.

Speaker Change: Sure.

Speaker Change: On the <unk>.

Speaker Change: Sure.

Speaker Change: Sprint piece.

Speaker Change: On the sprint.

Speaker Change: Sprint piece.

Speaker Change: There are fees associated with decommissioning or pan walk type of fees, but actually a lot of that stuff has been incurred because even though.

Speaker Change:

Speaker Change: There are fees associated with decommissioning or paying work type of fees, but actually a lot of that stuff has been incurred because even though.

Speaker Change: The churn is sort of spread out over this time period and a number of cases the installations have been decommissioned already and in fact actually if you look at our book.

Speaker Change: The churn is sort of spread out over this time period and a number of cases the installations have been decommissioned already in fact actually if you look at our wealth.

Speaker Change: The other bucket if you look at our bridge of revenue and you look at the other bucket domestically youll see that its actually.

Speaker Change: The other bucket if you look at our bridge of revenue when you look at the other bucket domestically youll see that its actually.

Speaker Change: Down a bit and that that is one of the contributors is that we've had a decent.

Speaker Change: Down a bit and that that is one of the contributors is that we've had a decent amount of that kind of contributing to our numbers in the previous years and so it's a little bit less now.

Speaker Change: An amount of that kind of contributing to our numbers in the previous years and so it's a little bit less now.

Speaker Change: They're still going to be more of that because there certainly are sites, where they're still continuing to decommission.

Speaker Change: They are still going to be more of that because there certainly are sites, where they're still continuing to decommission.

The equipment at those sites and we typically do that work, but I don't expect it to be something that would be all that meaningful to the results that we report.

Speaker Change: The equipment at those sites and we typically do that work, but I don't expect it to be something that would be all that meaningful to the results that we report.

Speaker Change: And then on the target debt level going forward.

Speaker Change: You know what our historical target range has been and we've been well below that target range for quite a while now and I think at this stage I don't see any reason that we will likely shift from the level that we're at sort of at between six and six five turns of net debt to EBITDA leverage.

Speaker Change: You know what.

Speaker Change: Historical target range has been and we've been well below that target range for quite a while now and I think at this stage I don't see any reason that we will likely shift from the level that we're at sort out between six and six five turns.

Speaker Change: Net debt to EBITDA leverage.

Speaker Change: And I say that not because it's our desire to necessarily keep it at that level, it's really about the opportunities for the investment of capital and I think if we see.

Speaker Change: And I say that not because it's our desire to necessarily keep it at that level. It is.

Speaker Change: Really about the opportunities for the investment of capital and I think if we see meaningful investment opportunities of size and we needed to lever up a little bit to accomplish those investments then we would be comfortable doing that but as I sit here today and knowing that we can fully handle the millicom deal.

Speaker Change: Gainful investment opportunities of size and we needed to lever up a little bit to accomplish those investments then we would be comfortable doing that but as I sit here today and knowing that we can fully handle the millicom deal that we're closing on later this year I think it's a reasonable expectation that will probably be somewhere.

Speaker Change: That we're closing on later this year.

Speaker Change: It's a reasonable expectation that would probably be somewhere below six five times as we get to the end of the year and that's what's implied in our current numbers that would've guided too.

Speaker Change: <unk> six five times as we get to the end of the year and that's what's implied by in our current numbers that we've guided to.

Speaker Change: Thanks.

Speaker Change: Sure.

Speaker Change: Thanks.

Speaker Change: Okay.

Speaker Change: Sure.

Speaker Change: Alright, our next caller, Rick Prentiss from Raymond James.

Speaker Change: Okay.

Speaker Change: Alright, our next caller, Rick Prentiss from Raymond James.

Speaker Change: Okay.

Rick Prentiss: Thanks, everybody how are you doing.

Speaker Change: Okay.

Rick Prentiss: Thanks to everybody how are you doing.

Speaker Change: Good how are you.

Speaker Change: Hey want to follow up on Michael's question, a little bit further.

Speaker Change: Good how are you.

Speaker Change: Okay. Thanks, and one follow up on Michael's question, a little bit further.

Speaker Change: <unk>.

Where do you think leverage needs to be investment grade you guys don't have a lot of total purchase options.

Speaker Change: Where do you think leverage needs to be investment grade you guys don't have a lot of final purchase options.

Speaker Change: Could you be investment grade kind of in the 66, 5%, especially shouldn't five times range.

Speaker Change: Could you be investment grade kind of in the six to six 5% to 665 times range.

Speaker Change: Yes, well based on where the agencies.

Speaker Change: Yeah, well based on where the agencies.

Speaker Change: Have indicated.

Speaker Change: And it's actually out there publicly as the breakpoints I do believe that we could be investment grade certainly with at least one of the agencies and I think with both.

Speaker Change: <unk> has indicated to us and that's actually out there publicly as the breakpoints I do believe that we could be investment grade certainly with at least one of the agencies and I think with both.

Speaker Change: At the at the level that we're at today, it's really more of a commitment as to our intention to stay there.

Speaker Change: At the at the level that we're at today, it's really more of a commitment as to our intention to stay there or.

Speaker Change: Or to go lower.

Speaker Change: We're frankly, not yet ready to make that commitment.

Speaker Change: <unk> go lower.

Speaker Change: We're frankly, not yet ready to make that commitment.

Speaker Change: But at some point.

That will be the natural course for things and that will happen I just think it's a little premature to do that today and frankly I'm not sure that we'd get much benefit.

Speaker Change: But at some point.

Speaker Change: That will be the natural course for things and that will happen I just think it's a little premature to do that today and frankly I'm not sure that we get much benefit.

Speaker Change: I'm doing it right now, particularly on our cost of debt basis. It would be very small to give up the flexibility that I think is more valuable right now.

Speaker Change: I'm doing it right now, particularly on our cost of debt basis. It would be very small to give us the flexibility I think is more valuable right now.

Speaker Change: And of course, sometimes you flex up as long as Youre committed to bring it back down.

Speaker Change: Of course, sometimes they like to flex up as long as you commit to bring it back down.

Speaker Change: Sure.

Speaker Change: The milacron transaction remind us how much in terms of levers that should be putting on as well.

Speaker Change: Sure.

Speaker Change: Millicom transaction remind us how much turns of leverage that should be putting on as we as we look at closing the deal in September and what it means kind of leverage next year.

Speaker Change: As we look at closing the deal in September and what it means kind of leverage next year.

Speaker Change: Yes, I mean by itself it puts on about <unk> two turns of leverage so very very small and obviously, depending on what we're doing and other places that may or may not even show up as we get to the end of the year. So.

Speaker Change: Yeah, I mean, it by itself it puts on about <unk> two turns of leverage so very very small and obviously, depending on what we're doing and other places that may or may not even show up as we get to the end of the year. So.

Speaker Change: When you're producing $1 3 billion and $1 $4 billion of they have so we can absorb actually a lot and not really move our leverage.

Speaker Change: When you're producing $1 3 billion or $1 4 billion of <unk>.

Speaker Change: We can absorb actually a lot and not really move our leverage.

Speaker Change: One more kind of.

Speaker Change: A strategic question and then one put.

Speaker Change: One more strategic.

Speaker Change: Strategic question and then one.

Speaker Change: Put it out there question, but.

Speaker Change: When you think about AI you touched on in your opening remarks.

Speaker Change: I'll take the question, but.

Speaker Change: When you think about you touched on in your opening remarks, when and how will.

Speaker Change: And how will Aif towers, we've hit it obviously affecting datacenters, but we'll AI <unk>.

Speaker Change: AI effect towers, we've seen it obviously, if I think data centers, but we'll AI.

Speaker Change: Benefit towers and also in one.

Speaker Change: The benefit of towers and also in one.

Speaker Change: Well, if I could answer that as explicitly as I'd like to that would be that would be good.

Speaker Change: Well, if I could answer that as explicitly as I'd like to that would be good.

Speaker Change: It's hard to say for sure is the honest answer we are we do believe that there certainly will be a positive impact as we mentioned in the prepared comments when you as you see these generative AI functionality embedded into the handsets.

Speaker Change: It's hard to say for sure Rick is the honest answer we are we do believe that there certainly will be a positive impact as we mentioned in the prepared comments when you as you see these generative AI functionality embedded into the handsets.

Speaker Change: And Thats really because it is a driver of incremental usage and incremental.

Speaker Change: Network capacity that we expect will actually be taken up as a result of those solutions. So it's not that different from other things that have been introduced in the past that have driven greater use of the network. So that broadly is very good for us obviously, there are AI benefits within our own business that we're introducing every day and continue to evaluate.

Speaker Change: Right here to become more efficient to provide better information to our customers.

Speaker Change: <unk> here to become more efficient to provide better information to our customers.

Speaker Change: That we think could drive leasing that kind of thing but in terms of.

Speaker Change: We think could drive leaching that kind of thing but in terms of.

Speaker Change: Something more explicit than that I think there could be but I think it's a little too early to know for sure.

Speaker Change: Excellent I appreciate it thanks guys.

Speaker Change: Makes sense I appreciate it thanks, guys yeah sure.

Speaker Change: Sure.

Speaker Change: Alright, moving on to Simon Flannery from Morgan Stanley.

Simon Flannery: Good evening.

Simon Flannery: Okay Simon to Millicom, you talked about a September one close can you just update us on where the deal timelines are what's the sort of sensitivity or is that going to be do you have good line of sight to that could it be earlier could it be later it might its closing stages.

Simon Flannery: Good evening.

Speaker Change: Okay.

Speaker Change: To Millicom you talk.

Speaker Change: About a September one close can you just update us on where the deal timelines are what's the sort of sensitivity is not going to be do you have good line of sight to that could be earlier could it be later it might its closing stages.

Simon Flannery: And then.

Speaker Change: Mark you talked about the sprint churn could you just give us a little bit of update on the international churn 26, and beyond what Youre seeing remaining from OEM some of the other consolidations.

Speaker Change: Yes, so on the millicom.

Yeah, so on the millicom.

Speaker Change: Closing dates.

Speaker Change: We gave you what we.

Speaker Change: Closing dates.

Speaker Change: We consider our best guess at.

Speaker Change: We gave you what.

Speaker Change: We consider our best guests at September <unk>.

Speaker Change: At September <unk>.

Speaker Change: There's a lot of different factors that are potentially going to contribute to the timing of that it definitely could be a different time in that I mean honestly, its our desire and frankly its millicom's desire.

Speaker Change: A lot of different factors that are potentially going to contribute to the timing of that it definitely could be a different time in that I mean honestly, its our desire and frankly its millicom's desire.

Speaker Change: To close earlier or at least close parts of it earlier and if we can do that we will do that because it's additive.

Speaker Change: To close earlier or at least close parts of it earlier and if we can do that we will do that because it's it's it's additive.

Speaker Change: We both like to get going here, but there are certain regulatory hurdles that need to be cleared and other.

We both like to get going here, but there are certain regulatory hurdles that need to be cleared and other.

Speaker Change: Diligence items and certain other things that need to get addressed so we.

Speaker Change: We've tightened at September <unk> for purposes of issuing the outlook and obviously, if it closes earlier or parts of a close earlier, we'll update our outlook as we move through the year if that happens I don't expect that it would that it would close later, that's certainly possible, but I think that's unlikely.

Speaker Change: We pegged it at September <unk> for purposes of issuing the outlook and obviously if it closes earlier parts of a close earlier, we'll update our outlook as we move through the year if that happens I don't expect that it would that it would close later, that's certainly possible, but I think that's unlikely.

Speaker Change: And then the international churn.

Speaker Change: There is a mix of things going on there I mean, unfortunately, most of the churn that's in our outlook internationally is in Brazil.

Speaker Change: <unk>.

Speaker Change: I would say unfortunately, its a little bit higher than we probably would have thought before largely built around the oi consolidations, but it's not necessarily just the direct consolidation is also all.

Speaker Change: And I.

Speaker Change: I would say unfortunately, its a little bit higher than we probably would have thought before largely built around the oi consolidation, but it's not necessarily just the direct consolidation. It's also.

Speaker Change: All the steps that the carriers are taking.

Speaker Change: All of the steps that the carriers are taking.

Speaker Change: Going through that process. The surviving carriers are taking to rationalize their networks and deal with.

Speaker Change: Other focus areas and so there as you would imagine trying to be as efficient as they can and we're trying to help them through that in a way that is balanced for us too, but it is pulling forward I would say some term that we probably thought would've been spread out over a little bit longer period of time and then beyond that.

Speaker Change: Other focus areas and so there as you would imagine trying to be as efficient as they can and we're trying to help them through that in a way that is balanced for us too, but it is pulling forward I would say some turn that we probably thought would've been spread out over a little bit longer period of time and then beyond that.

Speaker Change: It's a lot of different cats and dogs in different markets.

Speaker Change: The next biggest thing outside of Brazil honestly is a few million dollars of churn in Panama associated with the <unk> Liberty consolidation. So we have those things that are still going on but as I think that runs down we'll see that improve and actually be good for these markets is it will stabilize the markets.

Speaker Change: You will see that improve and actually be good for these markets is it will stabilize the markets.

Speaker Change: Yeah.

Speaker Change: Great. Thank you.

Speaker Change: Okay.

Speaker Change: Okay. Thank you.

Speaker Change: Yeah.

Speaker Change: Our next caller is Nick del Deo from Moffett Nathanson.

Speaker Change: Hey, guys.

Speaker Change: With respect to services Ethernet one customer that's historically been much larger than the others. I guess are you seeing any diversification of services work and 25 versus 24 or would you say it's broadly similar.

Speaker Change: Hey, guys.

Speaker Change: With respect to services, you've got one customer that's historically been much larger than the others. I guess are you seeing any diversification of services work and 25 versus 24 or would you say it's broadly similar.

Speaker Change: I would say.

Speaker Change: We're seeing increases across the board, but that that one big customer is increasing quite a bit as well. So I'm not sure that the mix is going to change all that much.

Speaker Change: I would say.

Speaker Change: We're seeing increases across the board, but that that one big customer is increasing quite a bit as well. So I'm not sure that the mix is going to change all that much.

Speaker Change: We're still pretty heavily concentrated.

Speaker Change: And a lot of that just based on agreements that exist with some of the other carriers.

And a lot of that just based on agreements that exist with some of the other carriers with surfing vendors and things like that and we continue to work with them because I think I believe in my opinion that they would all agree that.

Speaker Change: Surfing vendors and things like that and we continue to work with them because I think I believe in my opinion that they would all agree that.

Speaker Change: When we do the work for them, we do it as well as anybody in the industry and so we're seeing more and more of a preference to use us, particularly on our own sites.

Speaker Change: When we do the work for them, we do it as well as anybody in the industry and so we're seeing more and more of a preference to use us, particularly on our own sites. There's a lot of advantages for the carriers.

Lot of advantages for the carriers.

Speaker Change: But it has to be profitable work for us too and.

Speaker Change: But it has to be profitable work for us to answer.

Speaker Change: And so that balance.

Speaker Change: It makes it a little bit more challenging.

Speaker Change: And so that balance.

Speaker Change: It makes it a little bit more challenging.

Speaker Change: It is one of our internal goals neck that youre touching on to diversify our revenue base in that business because I think it's important to do and I think it's something we can accomplish.

Speaker Change: It is one of our internal goals next that youre touching on to diversify our revenue base in that business because I think it's important to do and I think it's something we can accomplish.

Speaker Change: Okay, that's good to hear.

Speaker Change: Second unrelated topic, Brendan you had mentioned a step up in the rate of new builds and 25 can you share anything about the kind of initial development yields that youre expecting with those bills and should we think of the change in the cadence.

Speaker Change: Second unrelated topic, Brendan you had mentioned a step up in the rate of new builds and 25 can you share anything about the kind of initial development yields that you're expecting with those bills and should we think of the change in the cadence.

Speaker Change: As basically being attributable to millicom as opposed to other factors.

Speaker Change: Yes, I mean, the millicom deal is definitely a big driver of that it's by far the biggest driver of that I mean, we've got I mentioned in the script that we had.

Speaker Change: Approximately 800, new builds we expect to do this year, that's what's implied in our outlook and in the discretionary capex.

Speaker Change: 800, <unk>, we expect to do this year, that's what's implied in our outlook and in the discretionary capex.

Speaker Change: Most of that say ballpark close to 500, it would be Central America as part of the millicom.

Speaker Change: Deal so that's definitely.

Speaker Change: The biggest driver, but there are other markets as well Tanzania is another market, where we're building a lot of sites. So it's concentrated in certain markets.

Speaker Change: Deals.

Speaker Change: That's definitely the biggest driver, but there are other markets as well Tanzania is another market, where we're building a lot of sites. So it's concentrated in certain markets.

But the ones that we're doing.

Speaker Change: Our very good we feel really good about the yields on those day, one they don't require a ton of lease up but I do think there is a lot of good opportunity for lease up in a number of these situations. So.

Speaker Change: But the ones that we're doing.

Speaker Change: Our very good we feel really good about the yields on those day, one they don't require a ton of lease up but I do think there's a lot of good opportunity for lease up in a number of these situations. So.

Speaker Change: It's a positive contributor and I think will help our return on invested capital that we report as we start to get into them and get them done.

Speaker Change: It's a positive contributor and I think will help our our return on invested capital that we report as we start to get into them and get them done.

Speaker Change: Okay, great. Thanks.

Sure.

Speaker Change: Okay, great. Thanks.

Speaker Change: Our next caller is David Barden from Bank of America.

Speaker Change: Sure.

Speaker Change: Our next caller is David Barden from Bank of America.

Speaker Change: Hi.

Speaker Change: Hey, guys. Thanks, so much for taking the questions.

Speaker Change: Yeah.

Speaker Change: Hey, guys. Thanks, so much for taking the questions.

Speaker Change: So.

Speaker Change: Brendan.

Speaker Change: So.

Speaker Change: Rental car has been.

Speaker Change: Brendan.

Speaker Change: A vocal proponent of kind of.

Brendan car has been.

Speaker Change: A vocal proponent of kind of.

Speaker Change: Changing the bead program to incorporate a little bit more flexible technological approaches to achieving some of these.

Speaker Change: You know changing the bead program to incorporate a little bit more flexible technological approaches to achieving some of these.

Speaker Change: Broadband goals.

Speaker Change: And fixed wireless access system one of them.

Speaker Change: Broadband.

Speaker Change:

Speaker Change: <unk> fixed wireless access has been one of them.

This has been a question we've been dealing with on the other side of the equation, which is how does it affect the wireline providers Im interested to hear your perspective on <unk>.

Speaker Change: This has been a question we've been dealing with on the other side of the equation, which is how does it affect the wireline providers I'm interested to hear your perspective on that.

Speaker Change: To the extent that any one has been phoning in asking SBA.

Extent that anyone has been phoning in asking SBA could you help me figure out a way to address fixed wireless access as a bead solution that would be one question and then.

Speaker Change: Could you help me figure out a way to.

Speaker Change: The address fixed wireless access as the bead solution that would be one question and then the.

Second question is.

Speaker Change: Another big question, that's kind of a rhythm.

Speaker Change: The second question is.

Speaker Change: Subsequent to dish kind of refinancing itself and getting 5 billion in capital. The question was what are they going to do with that money, where they're going to use it to <unk>.

Speaker Change: Another big question, that's kind of a rhythm.

Speaker Change: Subsequent to dish kind of refinancing itself and getting 5 billion in capital. The question was what are they going to do with that money, where they going to use it to.

Speaker Change: Best in handsets and marketing where are they going to.

Speaker Change: Invest in handsets and marketing where they can.

Speaker Change: Try to get to their build out requirements and obviously.

Speaker Change: That build out requirement extension that they just got.

Speaker Change: That build that requirement extension that they just got.

Speaker Change: From the Rosenberg FCC is under threat and I'm interested to know if there is some change in the conversation around.

Speaker Change: From the Rosenberg, so FCC is under threat.

Speaker Change: Interested to know if there is some change in the conversation around.

Speaker Change: How come.

Speaker Change: Mike factored into your thinking.

Speaker Change:

Speaker Change: How how dish might factor into your thinking.

Speaker Change: Power demand for the next couple of years. Thank you.

Speaker Change: Hum tower demand for the next couple of years. Thank you.

Speaker Change: Yeah, Okay, well, there's a lot there David.

Speaker Change: Alright.

Speaker Change: Yeah, Okay, well, there's a lot there David.

Speaker Change: No Thats alright.

Speaker Change: Alright.

Speaker Change: On the <unk> program.

Speaker Change: Alright.

Speaker Change: I guess the short answer is no I have not we've not really heard much from folks who are looking to us to try and help them.

Speaker Change: On the bead program.

Speaker Change: I guess the short answer is no I have not we've not really heard much from folks who are looking to us to try and help them.

Speaker Change: With fixed wireless access as a bead solution per se what we are.

Speaker Change: With fixed wireless access as a bead solution per se what we.

Speaker Change: As I think well in my opinion, and I think others would agree with this that it was obviously a very fiber oriented program and I think.

Speaker Change: Uh huh.

Speaker Change: As I think well in my opinion, and I think others would agree with this that it was obviously a very fiber oriented program and I think.

Speaker Change: Expanding it out too.

Speaker Change: To cover more than just fiber to consider wireless as a solution is a good thing and we would be very supportive of that.

Speaker Change: Expanding it out to.

Speaker Change: To cover more than just fiber to consider wireless as a solution is a good thing and we would be very supportive of that.

Speaker Change: So I do think that it could be good if in fact, it goes that direction.

But.

It's it feels a little early on that end.

Speaker Change: But it's it's it feels a little early on that end.

Speaker Change: It's pretty far down the road in terms of a lot of the money being out the door and what the plans are so I'm not sure how much.

Speaker Change: It's pretty far down the road in terms of a lot of the money being out the door and what the plans are so I'm not sure how much of an impact we'll see from that but.

Speaker Change: Of an impact we'll see from that but.

Speaker Change: Im.

Speaker Change: Have some little bit a little glimmer of hope that it is.

Speaker Change: I have some little bit of a little glimmer of hope, but it is.

Speaker Change: A favorable contributor for us and we certainly are supportive of that.

Speaker Change: On the dish side.

Speaker Change: When I think about the impact to us over the coming years.

Speaker Change: [laughter] when I think about the impact to us over the coming years.

Speaker Change: I think I mentioned in response to an earlier question that we don't expect a whole lot of contribution this year and thats.

Speaker Change: I think I mentioned in response to an earlier question that we don't expect a whole lot of contribution this year and that's.

Speaker Change: That's really because we're just not seeing that much from them they've been much quieter.

Speaker Change: I think that they have.

Speaker Change: A lot to do and when we have conversations with our network folks it sounds like they have a lot of plans around that but I think the extra time that they received it was build outs has given them the same.

Speaker Change: I think that they have.

Speaker Change: A lot to do and when we have conversations with our network folks it sounds like they have a lot of plans around that but I think the extra time that they received for these build outs I was giving them the same.

Speaker Change: If they can.

Speaker Change: Take a little bit more time and focus on their financial house.

Speaker Change: That they can.

Speaker Change: Take a little bit more time focused on their financial House I.

Speaker Change: If it's under threat and that change I guess, we'll see what that does have that in fact is the case I'm not sure about that but.

Speaker Change: If it's under threat and that changed I guess, we'll see what that does if that in fact is the case I'm not sure about that but.

Speaker Change: At this stage.

Speaker Change: It's pretty it's pretty slow with them. So we'll see and we're hopeful that it'll pick up we have a very good relationship with them, we have a lot of existing embedded leases and I think.

Speaker Change: At this stage.

Speaker Change: It's pretty it's pretty slow with them. So we'll see and we're hopeful that it will pick up we have a very good relationship with them, we have a lot of existing embedded leases and I think.

Speaker Change: There's a lot that we can do together.

Speaker Change: As soon as they kind of get clarity on their plans over the next couple of years.

Speaker Change: There's a lot that we can do together.

As soon as they kind of get clarity on their plans over the next couple of years.

Speaker Change: Alright, Thanks Brendan.

Speaker Change: Sure.

Rick Prentiss: Alright, Thanks Brendan.

Brendan Cavanagh: Alright up next is Ari Klein from BMO capital markets.

Speaker Change: Sure.

Speaker Change: Alright next is Ari Klein from BMO capital markets.

Speaker Change: Okay.

Speaker Change: Thank you.

Speaker Change: Just going back to the international churn curious if the level you're expecting in 2025.

Speaker Change: Okay.

Speaker Change: Thank you.

Speaker Change: Just going back to the international churn I'm curious at the level you're expecting in 2025.

Speaker Change: Do you think that that's going to be the peak and do we need to kind of move past the churn you're seeing to kind of seeing.

Speaker Change: Do you think that that's going to be the peak and do we need to kind of move past the churn you're seeing kind of seen.

Leasing start to accelerate internationally and in international markets or can they kind of.

Speaker Change: Leasing start to accelerate international and international markets or can they kind of.

Speaker Change: Separate from one another.

Speaker Change: Yes, I mean, unfortunately, I don't actually think that it's the peak I don't think its necessarily going be higher but I do think that next year.

Speaker Change: Separate from one another.

Speaker Change: Yeah, I mean, unfortunately, I don't actually think that it's the peak I don't think are essentially going to be higher but I do think that next year is likely going to be at a similar level to this year in terms of international churn.

Speaker Change: Likely going to be at a similar level to this year in terms of international churn, but its impact in terms of organic growth overall, obviously it weighs on it but there is.

Speaker Change: Its impact in terms of organic growth overall, obviously it weighs on it but there is.

Speaker Change: Different markets have different dynamics right now going on I mean, we've got a lot happening in Central America, and in Africa, and Tanzania, specifically and I think we will see not only a lot of newbuild activity like we're working on but we will actually see reasonably good lease up in those markets and in many cases.

Speaker Change: Got it.

Speaker Change: <unk>, particularly in Central America, we're pretty much through the churn the consolidation churn a lot of it has happened at this point and so we'll start to see that pullback, it's really Brazil, which is where obviously heavily indexed to Brazil. So as Brazil goes up kind of is the deciding factor for a lot of these things and I think Brazil.

Speaker Change: Central America, we're pretty much through the churn the consolidation churn a lot of it has happened at this point and so we'll start to see that pullback, it's really Brazil, which is.

Speaker Change: Heavily indexed to Brazil, So as Brazil goes that kind of is the deciding factor for a lot of these things and I think Brazil.

Speaker Change: Probably has another.

Speaker Change: Year beyond this year at least where where things will be a little bit challenging on that front.

Speaker Change: He has another.

Speaker Change: Year beyond this year at least where where things will will be a little bit challenging on that front.

Speaker Change: Thanks, and then just maybe on that share repurchases.

Speaker Change: Thanks, and then just maybe on that share repurchases, how should we think about that or are those likely to be on hold until the millicom deal is completed or.

Speaker Change: Let me think about that are those likely to be on hold until the millicom deal is completed or is.

Speaker Change: Is it kind of an independent of that and how youre thinking about it.

Speaker Change: Is it kind of in the independent.

Yes, I'd say, it's somewhat independent of it.

Speaker Change: And how you're thinking about it.

Speaker Change: Yeah, I'd say, it's somewhat independent of it obviously, we know that we have that commitment that we have approximately $1 billion of capital that we are obligated to pay out and as I mentioned earlier.

Speaker Change: Obviously, we know that we have that commitment that we have approximately $1 billion of capital that we are obligated to pay out and as I mentioned earlier.

Speaker Change: Timing of that hopefully will be earlier than what we put forth thats what were shooting for if we can make it happen and if it is earlier that means we have to have that.

Speaker Change: The timing of that hopefully will be earlier than what we put forth.

Speaker Change: We're shooting for if we can make it happen and if it is earlier that means we have to to have that.

Ready and available, which we do but it does influence our thinking a little bit. However, having said that we typically have run our share buyback program and I expect it to be the same for the time being.

Speaker Change: Ready and available, which we do but it does influence our thinking a little bit. However, having said that we typically have run our share buyback program and I expect it to be the same for the time being.

Speaker Change: In a somewhat opportunistic manner and so.

Speaker Change: If we don't see other things going on and we see an opportunity where we think there is a meaningful.

Speaker Change: And a somewhat opportunistic manner and so.

Speaker Change: If we don't see other things going on and we see an opportunity where we think there is a meaningful.

Speaker Change: Dislocation that happens that doesn't make any sense to us we may react more quickly to that.

Speaker Change: Okay.

Speaker Change: Yeah.

Speaker Change: Okay.

Speaker Change: Moving on to Brendan Lynch from Barclays.

Speaker Change: Yeah.

Speaker Change: Alright, moving on to Brendan Lynch from Barclays.

Speaker Change: Great. Thanks for taking my question.

Speaker Change: Another follow up on the government policy could you talk about the potential for more spectrum auctions over the next couple of years.

Speaker Change: Great. Thanks for taking my question.

Speaker Change: Another follow up on the government policy could you talk about the potential for more spectrum auctions over the next couple of years.

You are having any conversations with customers on how that would.

Speaker Change: Their attention is there and how are you.

Speaker Change: If you're having any conversations with customers on how that would.

Speaker Change: Port them.

Speaker Change: And inform their intentions are and how you can support them.

Speaker Change: Yeah. So obviously, that's one of the things that's being talked about by the new FCC that we are.

Speaker Change: Yeah. So obviously, that's one of the things that's been talked about by the new FCC that we are.

Speaker Change: Extremely favorable on and are very supportive of.

Speaker Change: As of course are the wireless msos here.

Speaker Change: In the U S and so.

Speaker Change: As of course are the wireless msos here in.

Speaker Change: Im hopeful that we will actually see an acceleration to improve the likelihood of having more spectrum auctioned off but having said that even if that is the case with.

Speaker Change: In the U S and so I am hopeful that we will actually see an acceleration to improve the likelihood of having more spectrum auctioned off but having said that even if that is the case.

Speaker Change: With the current delay that's taken place in the time it will take to get to that and then ultimately for it to be cleared and available for deployment Youre talking about a number of years off into the future and so.

Speaker Change: With the current delay that's taken place in the time it will take to get to that and then ultimately for it to be cleared and available for deployment, you're talking about a number of years off into the future and so <unk>.

Speaker Change: The conversations that we have with our customers are less about what they'll need to do with potential new spectrum years from now it's more about how do they optimize or maximize what they have today that they either still have to deploy or that they can.

Speaker Change: Conversations that we have with our customers are less about what they'll need to do with potential new spectrum years from now it's more about how do they optimize or maximize what they have today, if they either still have to deploy or that they can.

Speaker Change: Maybe redesign a little bit in order to maximize what they are able to produce with the current holdings. So that's the more immediate thing and that's the type of thing that we would discuss rather than around future auctions at this stage.

Speaker Change: Sure that makes sense.

Speaker Change: Another issue.

Speaker Change: Sure that makes sense.

Speaker Change: Youre selling the portfolio in Colombia should we expect you to exit.

Speaker Change: Another issue.

Speaker Change: You're selling the portfolio in Colombia should we expect you to exit.

Speaker Change: Additional markets throughout this year or is that.

Speaker Change: Process is pretty much complete at this point.

Speaker Change: Additional markets throughout this year or is that.

Speaker Change: No I mean, it's not our intention to necessarily exit additional markets in fact, as I mentioned I think in my comments.

Speaker Change: Process pretty much complete at this point.

Speaker Change: No I mean, it's not our intention to necessarily exit additional markets in fact, as I mentioned I think in my comments.

Speaker Change: We much prefer to not do that and to find ways towards improved scale and depth of positioning with the leading carriers in those markets. So that that's what we're focused on but having said that in some cases like we did in Colombia.

Speaker Change: We much prefer to not do that and to find ways towards improved scale and better positioning with the leading carriers in those markets, but that's what we're focused on but having said that in some cases like we did in Colombia and like we did in the Philippines, If we come to the conclusion that we don't see.

Speaker Change: We did in the Philippines, if we come to the conclusion that we don't see.

Speaker Change: A reasonable viable path to getting there anytime soon.

Speaker Change: FERC for purposes of being focused with our operations and where we are spending our time and energy.

Speaker Change: For purposes of being focused with our operations and where we are spending our time and energy.

Speaker Change: We would consider it but its not currently something that we have.

Speaker Change: We would consider it but its not its not currently something that we have and the.

Speaker Change: Hopper.

Speaker Change: Great. Thank you for the color.

Speaker Change: The hopper.

Speaker Change: Sure.

Speaker Change: Great. Thank you for the color.

Speaker Change: Alright that was our last caller in the queue. One final reminder, for last question Sterling pound too we will place you in the question queue.

Speaker Change: Sure.

Speaker Change: Alright that was our last call or in the Q1 final reminder, for last question Sterling pound to replace you in the question queue.

Speaker Change: Okay.

Speaker Change: Alright, it looks like there are no further questions at this time.

Speaker Change: That concludes the Sba's fourth quarter 2024 results conference you may now disconnect.

That concludes the SBA fourth quarter 2024 results conference you may now disconnect.

Q4 2024 SBA Communications Corp Earnings Call

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