Frontier Communications Parent (FYBR) 5 Aug 222022 Q2 Earnings call transcript

Welcome to today's Frontier Communications Q2 2022 Earnings Call. My name is Jordan, and I'll be coordinating your call today. [Operator Instructions]. I'm now going to hand over to Spencer Kurn, Senior Vice President of Investor Relations, to begin. Spencer, please go ahead.

to Second welcome Call. XXXX and morning, Frontier Quarter Communications' Earnings Good is of Head Kurn, Relations. This Frontier's Investor Spencer And joining President Chairman Officer. of Officer; me Stratton, Scott the John on and Board; the call Nick Chief Jeffrey, Beasley, and Executive today Chief Financial is Executive presentation the and in followed is of our within Presentations Events and section be Investor can available Today's webcast the Relations website.

remind that may you to and cause our risks disclaimer those and contains include uncertainties Slide safe call expressed conference statements which refer you X, now that this me actual involve differ Let and results today. forward-looking that materially harbor may to from

schedule. during this the call that, to addition, reconciled certain defined I'll John. refer to over and non-GAAP trending financial in our In press With we which presentation, are call, turn measures, earnings will and release

morning, Good joining and for you everyone, today's discussion. thank

snapshot to an positioned is our Let value. continue we in updated is start win to opportunity Frontier to of me X. on well significant create today realize unique where shareholder our and Slide markets, with company key

footprint expand at locations XX XXXX. network, across we million to states. X.X fiber footprint fiber are million these million our and a of locations Our XX of optic passed plan locations least by total XX to our passes superior by

billion now continues we've months, generated across we reach adjusted commercial Our EBITDA to broadband which the expand, revenue margin. EBITDA, XX% last XX adjusted $X $X.X serve customers businesses. and million X.X of and represents both of In consumer a and billion

to up, in tripling revenue consumption customers our only significant fiber represents we've months. the generated that $X.X and ramp EBITDA our now next X our years for to focused the XX decades the continue and As data over on last are our relentlessly we've believe alone X EBITDA, as will Frontier. fundamental investing fiber this reality X growth Fiber grow for majority outlines before, industry the Slide the fiber best long-term future This to of of alone. of last rapidly. reasons. We products of meet over demand we positioned EBITDA billion consumption $X.X becoming and is several our thesis, fiber in the seen said is data billion is

product fiber a provides upload wireless cable and is First, latency. and vastly faster superior today. to significantly speeds, It alternatives lower speeds faster download

superior of nature Second, is real usage by in the see the trends magnified fiber time. we

Our expected where terabyte X customers cable average of fiber fiber. will to per move is what towards believe of wireless broadband month, the over data X and consumption the triple industry naturally market nearly an In customer multiples we next consumes data consume. years,

from instantly We forward infrastructure on more to with emphasis technology-based upload in federal fiber a actively more download network which NTIA's obsolete state deployment the of to guidance appreciate and subsidy participating of government look shifts We to Americans. the XX federal networks has low-cost consumption capital continue clear to minimal while recipient investment. have ideal infrastructure increase to per across Fiber the of of second as speeds throughput scale of beyond, delivering economies gigabits And Third, any technology is future-proof stimulus. to broadband programs preferred and funds, a America's standards up construction. the speed and the additional lastly, broadband fiber fiber fiber path requiring to data recent and best approach networks. bring and

Now X. turning update on Slide Wave X an to for

of footprint, designated we in million maximizing as X X and would plans ago, build mentioned X. to Investor remaining year our footprint, assess what X. we And million as our said to at referred the Wave what to Day have XX I homes our homes we X waves our in we rapidly fiber As we announced value

also X funding is we've and could million-plus of X next significantly identified are this to several has increased scale we subsidies. year, the the year And a without an past distribution today worked specifically, billion higher understanding the level. command fundamental years. detailed had the return engine. build X dependent levers led federal modeled and our to execute million to of to the We've More our of additional initially very $XX million than meet return we've X our remaining requiring ago. of million upon X business attractive Wave that over locations, X level what build the us broadband hard Over leaves conclusion up in This profile of the thresholds, fiber infrastructure candidates locations that which to also

ownership more we recent them to a our to remain upgrading X an our runway Wave We time strategic Importantly, of capital to maintaining attractive these And remain options. for we and although open is raise curate footprint. fiber, value. more us locations its on other assets. It maximizing attractive see affords laser-focused

critical publishing June hand-in-hand build of And mission share component America. X. to to the inaugural go of an to step that has a been our initiatives fiber-first report transformation. our Turning our Gigabit important ESG some Slide with in was always

opportunity like On to Fiber environment, and less competing than the in and industry of the energy as serve we our cable. uses sustainability the environment. technologies recognize responsibility lead stewards both our

as investing energy ESG you are commitment launched our employees live encourage upgrade have on a core our through our safe, to our direct programs. as and initiatives with our well to our align I a implemented practices and Frontier on to On executive inclusion which for We social, values. fiber, to and on greenhouse the includes committed equity the electric also you diversity, to updating compliance to read So order and and and This inclusive to vehicles. comprehensive compensation our the business and our compensation standards. as our our can workplace a pay-for-performance programs and in we're Initiatives where in We is philosophy waste, On business. gas and healthy more to we're communities we creating valuing reducing people governance, footprint. we We've thrive path of simultaneously to also decrease including look consumption first-ever Green our forward executive our reduce detail network significantly our applying integrity report oversight with into initiatives. work. Board our lead progress. team how We've of ESG builds Board ethics representation highest diverse copper

Slide X. on Now

performed demands a efficiency. in these been opportunity pursuit the levers quarter. Nick? Our value the priorities, call critical have now fiber to X of operational how the turn and with I'll over the their to experience team review and in strong second fiber on momentum we're penetration, and been pleased in build unwavering of relentless we've focus customer his able our business. deployment, to we've Nick creation: Nick

John. Thanks,

are And target XXXX to quarter. We million executed team against to Our raised strategic build extremely That's our the highlights. to X.X of X.X priorities XX% just fiber in X up of the a few million a our locations. target million XX% built and record locations. our XXX,XXX well second here original connections new from

It quarter, fiber business. continued additions about consumer to XX every our up XX,XXX SMB quarter. improving customer our increase. customer And continues this base another customer our quarter experience. added our in grow our We broadband We're this remains fiber NPS points Additionally, to focused record of day achieved on business year-over-year. customers and in

fiber $X.X through build we raised Finally, our mid-XXXX. of fund billion accelerated debt to

in are translate this success our EBITDA release As press call. in EBITDA quarter this Scott starting initiatives we will sequential more operational you and in later achieved growth. of financial guidance. to see the cover of growth of schedule morning, saw raised XXXX the into ahead the midpoint this our We our detail

company, and on As profitable milestones we expected, our our we've transforming our reached is Frontier to growth. returning fiber-first path strategy critical to

Let's review our progress.

and by fiber in building drove Then consistently hit of of our we fiber fiber build net fiber began organization. EBITDA quarter our in the at our we second the every quarter scaling records copper an XXXX, in adds. that EBITDA. surpassed inflection quarter team scaled And First, broadband sales point, in third And we've XXXX, since.

continued years, our resulted when, in first Our greater This copper quarter year total for fourth adds than last were than in of acceleration growth. adds net in customer of declines. fiber X the the broadband time more fiber

This And magnitude sequential delivering in our into milestones has confidence growth year-over-year to into in operational Frontier EBITDA perspective, we've achieved milestone, quarter, began financial me This progress and achieving growth. this growth since most sequential healthy investments XXXX. of this EBITDA sustaining the put results. produced made we to greater not XXXX. EBITDA critical translate and our gives revenue

with Now deployment. let's our dive strategic initiatives, deeper into beginning fiber

want new record Slide Chief this As Officer, challenging to this in earlier, locations that to with with had strong we've confidence XXXX to the to quarter and target than foundational I to give highlight us planned. pleased originally of steps complicated we the XXX,XXX over build build strong Network work, us a I'm On fiber. and our faster her execution It It's also macroeconomic environment. confidence. our face taken I XX% supply passing the our XX%. Bloodworth, quarter, gave year us chain team's our performance fiber the have past enabled raise team noted by another XX, and Veronica

Firstly, into year. by maintaining of least be XX fiber opportunity build provides to building end for at additional our the build we states in and X diversified This pace. build diversity the the geographic fiber and states our expands to redundancy plan

density labor build labor and cost we chain route efficiencies contracts and inflation thirdly, targets. diversifying meet Secondly, improved challenges to for cluster order techniques. through passing supply with realizing per us allowed and in and new cost This construction to continually we're optimization, our with additional equipment. are And manage our

helped build. our permitting has Finally, significantly improved over we've our the year, accelerate past which process

initiative continued quarter. strategic the second is strong in where our second Our fiber penetration, momentum

driving year. consumer base As to XX,XXX customer I same fiber in added the earlier, period we XX% a last our customers, increase broadband mentioned

Although it's Florida. net recognize in important footprint movement this to quarter from to year, our in adds fluctuates XX,XXX fiber base modestly the that due declined seasonal first

penetration be for XX a of We expect at look in the year. fiber markets. half a to seasonality expansion takes fiber the base Slide the closer our and second our tailwind

made have of million basis we're penetration. Florida. Our our increased for that results expansion our even in footprint XX% this penetration up sequentially years These the XXXX footprint, on had in that that our target XX% right with we headwinds And long-term the to That's middle the mark. seasonal fiber points range and reached of XX.X%, markets. out. cohort towards homes previously at several XX to XX-month base are Penetration XX% mature the in in right path our XX% set X.X of is achieving footprint fiber in demonstrate

of We in half XXXX rise results. effects expect this of the initiatives our penetration as the QX sharpen our start XXXX to cohorts year to the second

build target range our XX% of to expectations, exceed XXXX continues our our mark, at above of cohort reaching well XX-month penetration Lastly, XX% to the XX%.

structural XX% of second with price higher. we slide, per between and gig see forward of Moving X% improved Customer have in been adoption sequentially X grew from mix increases or combination speeds. year. of quarter, gigabit And XX% customers rising speeds you and chose second fiber demand the X ARPU new can the speeds our for broadband gig-plus a each increasing

X new symmetrical the sub-X customer gig be time. for to Our meaningfully the our And than higher customers is X plans, we plan speeds ARPU on gig gig higher gig mix grow have to mix customers demand of the for tends activations ARPU of significantly faster since entire X as over potential base. than

customer Our XX. Promoter Net you on and is see can which Slide experience, through Scores the third measure as strategic improving churn, initiative we

NPS and sequentially this year-over-year. increased about remains XX quarter fiber Our up points

our ranks major across ranges. customers churn. churn at now self-service digital move-related broadband amongst end excited week out churn Broadband lower results also historical remained to customer XX, every to in primarily highest mobile customers to the capabilities, deployed doing plans due have and NPS efficiency to and systematically suite about processing tech Copper and, use us. This due the We've like fiber all all copper and to portal both app, improvements of of improving focused on We're of center exciting language we're see a brand competitors. support the voluntary for part, of and with did low due Our churn the compared year, roll making XXXX's our the improve rise artificially also data. largely and making new to see Slide using dispatch the at to last our the everything improvements our tools call On these COVID-related do, and restrictions. it to slightly teammates. faster a digitize and showing improve work we're encouraged telematics, experience. was the customer to We're self-installation, better and to I'm and logic, natural mobile AI customer-facing up in easier center period work we a low NPS new because disconnect churn are of you'll to same churn putting is

we're SMB. to good I building momentum the highlight want Lastly, in

last our fourfold, adds. a teams opportunities. business. of new the series actions and our with upselling this management of few a strengthening account in and a established X-gig revitalized cross net record made another channel Over We're platform have sales offering a expanded that and adding RingCentral. quarters, We've improvements new we've have focused CRM quarter partnership resulted Together, product on these with

We have SMB, encouraged a process. long and runway our early with by I'm

I'll Now Building Scott before for just hand really you I team want so made I'm to thank turn say over hard now to you. And the Scott, to with performance, America. work, Frontier through that, in all did team. and whole our our progress the together over Scott. Gigabit Turnarounds to grateful to you walk we've to I over financial are to

Thank everyone. you, Nick, and good morning,

on As changes forma adjusted pro clearly calls, I to had the last previous the periods. business order accounting figures fresh describe of several start been our I've versus reference will more that in done for performance

results to XX. Slide Turning on

revenue growth of million to $XXX million EBITDA. $XXX due came and products. net earned of of strong and broadband and X% initiatives. adjusted was up year-over-year adjusted fiber fiber cost-savings million million EBITDA $X.XX $XXX consumer our quarter increased from Second was sequentially. This We $XX billion income

of also half focus bringing flow million. generated business our and These Additionally, a tax increased liquidity cash-generation was quarter's sales working of EBITDA we million. on The as by adjusted cash onetime million to the $XXX well demonstrate as helped cash from $XXX management. the of net underlying operations, potential first results healthy capital refund total our $X

Slide to Moving XX.

expiration consumer X% drove points was Our a broadband last the as primary increase the Fiber CAF up growth revenue and II sequential fiber engine wholesale. revenue more year's of due revenue to primarily few to key versus subsidy growth quarter. roughly and revenue. A than of consumer declines revenue quarter, business fiber second Total declined sequentially our revenue in growth. consumer offset year-over-year X% X% in on

Excluding video, growth acceleration fiber an revenue grew representing X% quarter. X% from year-over-year, last

X% fiber increased higher speed and broadband above increases with business Copper driven as X consistent consumer year-over-year, underlying gig sequentially, ARPU X% a both or price by declined Our prior faced consumer mix. and revenue headwinds. quarters, expected

It's growth growth consumer grew offset Fiber X% XX. our Slide trajectory an growth second will capacity. year-over-year, from from last strong products. and build. is ended quarter, a company. fiber broadband and XX% cash headwinds billion and clear Slide the of the quarter company. with fund to today as EBITDA acceleration our improvements billion million to shows X% investments EBITDA EBITDA roughly We short-term revolver that Turning drive Fiber fiber $X liquidity of the XX of of increasingly and fiber-first Frontier margin video products available represent adjusted $X.X overall $XXX the of

In strong addition flexibility. sheet ample have we to also this balance liquidity,

end the healthy under the target. leverage headroom at net our low at quarter, Our remained X.Xx net of us leverage giving

now This and in have debt maturities XX% any fixed debt of May, runway our to accelerating maturity $X.X provide significant structure clear do is us we our rates, capital and continue a not at approximately our billion time build. than fiber earlier Following XXXX. line raise

Slide simplification Next, we'll allocation strides quarter. on on XX. this move capital business great initiatives We our to made

our the through we annual end about gross realized exceed of us million Fit This the of attack track and savings. $XXX savings. $XXX ahead had of goal million roughly of X on for by of to the cost initial year schedule And continue XXXX. puts Future We QX, end to cost

The services quarter affordable business the half XXXX. to And healthy. generation first in year, bad meet are invested wide of strong customer the outstanding cash we We our underlying like from connectivity in remains the macroeconomic $XXX measures the sales fiber of provide of offer which and describes in needs, versus range be strong. that generated current and of the of to improved days our The XX continue we the debt, government's second flow customers. critical operations Slide million Additionally, build. products high-return our we a track including cash metrics payment positioning services our we program. closely, to Both specific environment.

pockets of in still our location. $XXX confident fiber see to per we inflationary in we are $X,XXX cost While pressure our build,

and place suppliers We key have multiyear agreements and and labor in to material with in continually finding our ways are supply more techniques. efficient chain become construction

from I at rates structure of as with XX% rising Finally, interest debt capital our is before, noted well insulated until no and significant fixed our XXXX. maturities rates,

XX. Turning to Slide

now $X.X We of accelerated reflect locations. We the are expenditures to of at X.X updating to capital to position of guidance build reflecting halfway $X.X year. expect point million our our million improved X.X the our billion, fiber billion

our we of the midpoint acceleration growth to tightening range. due are cost our initiatives, savings Finally, consumer the guidance of and EBITDA raising revenue and

is close billion. track range deliver revenue to $X.XX by a sustainable investment inflection by today's and growth remarks I'll We XXXX. year-over-year new EBITDA Our and in the of EBITDA $X.XX Frontier's year reiterating end billion the to remain thesis. on

First, there household expanding consumption. is driven growing demand and by for strong fiber data

fiber lower a that driven that superior latency by and product passive cable's is of speeds for a upload conferencing of lower uses levels enable far like download and including technology a Second, fiber's video number ownership critical symmetrical cost exceed capability, and reasons, telemedicine.

purpose and strategy at clear a have we Third, Frontier.

liquidity leadership economy. to last, of balance Building and experienced to And are strong We our Americans part connect to sheet, to a Fourth, strategy. strong a access America we providing to Gigabit capital the proud ample team. with I'm have and digital us fund be

over I'll momentum. now We for this for excited open line questions. up turn and straight continue the to and well to Spencer X are quarters have back call financial to the operational executed on building

we're for Operator, Q&A. now ready Scott. Thanks,

Instructions]. [Operator

Goldman of Brett Our first question comes from Sachs. Feldman

quarter. in see what half. look year EBITDA that to in at we EBITDA EBITDA the the reasonably the If first the did guidance, result at And comparable great the midpoint you half it would be implies second the your of updated in your to

I that it puts constructive your we maybe the should to through some X So the just was including be increasingly passings develop into us and walk you like the takes, Wave opportunity on are consideration. some of factors hoping, maybe of sounds you in any seasonal then footprint. taking can And

I to do X million think could that without your during million you X prepared subsidies. remarks identified you

indulge officially now of curious, Or part can companies I'm have in others. just additional The is by ? any, from you some what plan? to see, impacted Wave business that you're cable into And And level me if pull last to need little been a here, operators? from do of work bit. curious kind the competition question the I'm that So to then would clearly from just response you those of competitive rising if starting and you

Yes. This Brett. Sure, Scott. is

for me for second and the pass Let question the the it then first take third. John and to then Nick

driven ahead four, we plan; solid benefit; milestone look EBITDA executed sales in quarter and outperformance; So reduction then really the own versus tax that. cost we well two, program of by had inflection be the a first of of execution. was at our we three, we confident If expectations Coming by and consumer an and outperformed would still half second had One, we factors. we're QX most extremely that few kind into first in a the onetime the important question on half, QX, very half. knew financial the we year, first

to the sustained of for just energy highest we're led billion, billion trends. QX raise midpoint to quarter that is year cost inflection our from the guidance outperformance due the half QX. confident of and in us seasonality first that So still $X.X to $X.XXX

inflection revenue highly be be confident heading XXXX. of that sustained bit QX EBITDA a headwind, So into will point year-over-year we're and in that a will growth that but

X John. it's here, second go households sort the million take we specifically We'll here. Yes, Wave X second question more I'll Brett, as looks on round question. million of X. to we Yes. this Robin -- the very solid. take I'll extra so declared

terms here so build. in process our and bit with we sharper we've And efficiency a and which gotten of methods

and clarity returns. of demand how have to pretty high level a generate to proper ensure the best attaining build on we're We against

we this: happen still. expect pace we something of are that ahead, as look the So see to what build accelerating we is first, our is

next saw us the so a to you significant We've that from up it bring to talked XX And about year in uplift XXXX. drive X.X. million the X.X, by

period, will some sooner of Wave see into a described remain, build so the those pace overall properties of may far. X You filtering but as the we've

sit, this if and The something for continue is to next see So work. there's then this further. opportunity financing that an roughly X.X we year piece where we'll we'll of go to is

is out capital. X. important we of months combination few as to business so of This this, to think have billion then broadband and us of ago, that it's This posts want a building one officials with is in allows $XX is state, opportunities. the we Because doing programs. we something in terms preparing about the to pushed federal, the to we're make now the that raise And local well engaging. demand successfully a of goal for municipal the Because out Wave in it sure actually really and did the ensure regulators, things we're for our subsidy the subsidy super working networks participation moving

it allow pull to even million will additional of time in a Wave total X, with X households. the further chance so us here And this that into

we nonrecurring and expect of combination So If combination then a out. chose from as cash a if pulling to you savings, lastly, go we and organically, government be this there. recurring should subsidy, it'd operations, we debt do go cash

tuned. stay So

work go. have curating sort to We'll do those Nick, the want more take to we you piece terms assets. of We one? as do of be updating in

John. Thanks, Yes.

quarter it's to And fiber the cable a superior results fiber remains to from quarter, product in XX% we said, we've have against competitor and every always we every today. cable X our And ourselves of And operate Just in competitors. I true. footprint, as our clear it's reaction competitive, we're where that or said, cable. that's the that, whilst competitors specific not geography recent see seeing in. this gained data have that second That to the or think repeat, we market where from worth fewer that also is reminding in that, external suggests that's share we

think superior we speeds. want better era it customers we product. it's do that continued It's step therefore, symmetrical, back, And it's in customers, better offers of with of take a homeworking. sort continue faster fiber. course, And of in very service, make if that its I benefit lot a clear of a to nature, this to particularly and

when think pricing cable in Now a do might long up don't that that, about of reaction I that we the get won't like, have, promo of on later very course, customer prices clear. history be customers to then cable really that has journey. jacked the practices And

player And a remain reacting best best we hence, the product. all energies value today. We the focus will see that, rational results providing on the we our have pricing and customers and to

course, discipline all predictability demographically. markets occasionally, need and be customers our pricing we compete of is to Now we that we framework geographically in which relevant in, will in transparency the pricing remain always the of within and promotional But our and in geographies use rational for to to because customers. both going targeted

question next of Our JPMorgan. Phil from comes Cusick

seasonal Florida could copper Or accelerated fixed from seasonal this widespread? departures really from Were second is a longer areas? at had Wave has of sounds year. X. the quarter. last ways a wireless X? follow-up on blamed on those headwinds copper this And all, outside any looked then understand of quarter. departure over on completely, We've at And it almost like in the fiber that look Does to come capital be that but different Is you like company the that now acceleration every equity So that Wave seen competition? I in bunch dead? no more It

Bill, this Scott. is

Let for me one. I'll take and pass to Nick first the one, the second

million emergence; big it you incremental yes, in to than Wave homes a, positive fiberized. show a that X on million thought that, to to think they're is think worth is X pass So and then today we that guys we give to it dimensionalization there's more point specific b, we X, to the be going there was

we're we In company. about a additional -- a of could much the transform to it think more subsidies will that. terms range will partnership the business as take pursue funding, in We for options. to leverage likely on Government talked mix fiber-centric or it. able portion of continue John into JV we a options. of be be We have

there So raise we to of figure work sorry. continue pick out to that options business X. the -- us capital solid way the importantly, a the we'll Wave did best through. that go And and range we transforming there build have the I'll buys time

hear looked in on say to of options. going just the equity that of outside that, one that's like I'm sounds things one didn't It the know I been not that's going raising I as the And past. has at happen. to

Phil. I Listen, Yes. dry this, think we hold on our powder

But declaratively started could small say last out we've that." when pockets the in didn't of What it where And scale. was first is looking whole "All can I the at X build this that you'd million, period. this through I we say, said, pocket expense. kind of marginal kind this it we come As you'd see of across right,

we made first the X more. the XX so Wave total it to of affirmatively million holding declared announced sense a as of very kind work notion bit aside it And for households, and that us

million Now X very really be been and able very determine X and financially. clear we've homes clear I very, is build mean million with that, built. it what that compelling it to to must is

that at for organically. we'll is level consider equity, do to look might it. this interesting no do a a proposal great was described, some a returns. But as really encouraged And this If is here. longer We with And our different the by So it pretty options. time which have are frame something Scott we that of is several will now hanging very back. to nice there outside of sense, going that make us be kind funded, bias economic then JV means is structure we the to

come way. that about is it's that the thousands, As across will to need XXXX the funding a mean, middle of I a quite material different of flush significant of That s And every there territories together jurisdictions. they're of will state. end, applications we're that like an subsidies, sort a process. these be are heart in methodologies second of The in of half through we describing. at the many government in very sort pulled with thousands be of principally right talk

do be very X the to But external is of to takeaway in And sort of million will I the subsidization. factors, principally more other that, depend built. million, should reliably from done. So work of think on specifics how the can, sort balance those then this of it of terms X the and largely gets will X

Yes, Phil, Nick here.

Let's and churn. on its copper up on question the pick impact FWA

said going to Just on FWA, calls, first on course, of exist. of all, we've previous it's

We grows, access areas begin expect at and more our we point, actually will And more base, fundamentally And questions over scale, And in remain about will wireless of efficient a to fixed proposition. operators some the different use for rural and proposition very the for have those fiber profitable think I can edges also, copper course, serious perhaps access on. are and is questions industry. capital questions nibble not. at of the it's time, our to as spectrum. whether customers core those indeed, us, usage fixed of wireless fixed it wireless how far so or But for less whether very

just a overlapping churn, whereas nonpaying in couldn't. we increase fact, increase we've saw back in churn. driven deeper a by customers, or mostly, able dig if COVID, over been was And basis nonpay this see of in don't course, step really But point to area. that the during a we And year, little copper disconnect XX churn we year into so and it we take lower-quality

Now really an actually X the points basis year-over-year, voluntary so if to and sign communications, declined is many changes at improve look to churn, customer customer of which making you retention. it engagement on experience, we're encouraging better single customer leading is that every our week

significant fixed levels from see players, broadband adds And in we actually so seeing -- base. net the a do, we're of whilst the course, of high not wireless our copper impact fixed in

Cowen. of Our next comes from question Greg Williams

X seeing on to it your seeing to and capital there PE not and any on build X encroachment you X in infrastructure the be builds. you top on million are fast of build. may fiber-to-the-home provider million to trickle John, in in you as my question influx does X if areas? some Another an Maybe here -- million as footprint? a the you possible third homes? of space, million them Wave over encroachment and in attractive But X could Wave those Because question, you're they your are as second whom -- X to on noted that that's

Great. you. Yes. Thank

to to position. I first, would second I not about your an be to that one mean over of be ambitions, be question really builder. it's like in time if a difficult think them think I lifelong

we've way been of before really It footprint. a surprised I it's a availability we of our to permitting now think tightened like. in meaningful closely of it's The access seeing that's And a think we've even because market's and problematic, for bit, guys. gotten seen applications seen really not of any terms think, that capital presence. really of cost hard significant little And this terms up in factor is has lessening across presence. I'm for many And those really, in of I'm pretty case. the the the that watch I them. and a that, level harder. I a But gotten we surprised weren't less candidly,

remains still at pretty that low So a level.

Where return of described orientation a when really that build? can, Scott should her side. team see get One year can next team on organization Nick of kind I other And Veronica as another significantly. to side the the to fast Regarding with that capacity hair opportunities? viable? probably of this the kind forward the the this you our on how there's is is do cranking increase in XX% year's we and the build Bloodworth is and build, We are is game then financially great in are jamming build? carrying and significant XX% to to Like for X build fast acceleration, this. what sides run here. increase -- is we it what And fire, done builds brings as

all But can, the with jurisdictions. where tell we you in well, in So case, look, it build look approach kind doing I doing accelerate to we're of have right we it going the would every to, that further can to inform X faster regards But million and we we'll go or with Wave here how X yes, specifically do much X. see forward. go to to million work that we more as in that

You'll more we our more and to opportunity as targets encompass hear us sort of adjusting of set. go that

Harlalka Vikash Street New from comes Research. of question next Our

I could. for Chaplin. Two, This is Jonathan if Harlalka

deploy First, Or insight make are X? of value this within returns private to you still $X,XXX that in to for Is sale expectations higher, down? you stories would or line. the it for there return for that of cost something of up? broadband more sense it sell are to it equity returns close a in what else? Wave players is Wave to is private million million infrastructure, X deploying at to some it's willing homes And per And your Suddenlink if expected X, if a Wave are higher? X because to consider into Or penetration mean assets? may second, give X pay confidence are equity teens that does make

Yes, Scott. is sure. Vikash. Thanks, This

in in cost quarters. Wave assumptions on gives I'd exceeded take our on $XXX X in those. me our first met $X,XXX mid- both passing, X your did that our our high-teens and question conviction On Let or us modeling on penetration detailed increased say increased confidence to Wave the past of X, the we've ARPU confidence IRR that Wave where around modeling, per X fortifies to we

Wave $X,XXX different second analysis first be fiber Wave conviction passing even On at $X,XXX your Day of will in last priority And completing about between Investor per should and view I'd passing, X. a showed X. the at our around say valued question gives at our the more least. be transactions that valuation potential market, X So Wave again, we us year,

build, there can. worth assets there would $X,XXX out even only us increasing other our that data are to suggest we points that to in market reasonable, confidence to conviction fiber copper convert as the $X,XXX gives that so and rapidly And as strengthens maybe to if conservative think accelerate then $X,XXX per is I passing,

comes Louthan question of Raymond Frank next James. from Our

those Looking an at and your California, newer us you some back of percentage legacy the builds the cutting of winning subscribers can Texas, down customers you're resi versus you're give subs, of churn? getting Florida idea from what markets where

This is Frank. Yes, Scott, sure.

penetration. If you in success presentation, fiber we've in fiber expansion great really both. base show and note penetration the had And we

been then And will the penetration into mid-XX% QX, the and nice our fiber even that an typically the on has layer our we for And kind really be adds per always as still, more very expansion which a of to baseline markets. from of we've base up crept Expansion more overall into given a base grow, And part a growth. that's expansion quarter. footprint. what has we up and we slow which we'll growth. able tailwind quarter is Florida manage seasonally So more described has become were showed in customer healthy bigger builds layer

today bad where you if And running apologize you bad of -- I And XXXX? in but up Great. right. reserves? what All take any you're debt you your can compare debt versus earlier, did this mentioned

better and really on particularly this keep something bad the in end QX the they a health it's have were question days debt seen last Yes. of financial not the around And year. that sales of remarks challenging outstanding in expense the close this said our environment. year on, end QX we payments. at prepared we and customer, were of the at macroeconomic I than eye It's a actually impact an

incentivized outstanding. which reduce due of healthy. part it we've made. base our debt is is and get So part operational people expense sales of remained bad on And to auto improvements customer that has We've to pay, helps reduced day

Del next comes question Deo of from Our Nick MoffettNathanson.

on just expand now those comparable Are X? X would return X to the of First, on how they you on as X on million Wave to homes, profile appealing, the the Wave Wave look they million some questions might preceding Or you locations? say, would generalize, be hitting to if characterize geographic go are notch Or are Wave typically locations lower? X, are of these to you part hard new this X down it but be that they route? you that And cities clusters?

for Yes. Nick, thanks the question.

the part me first. Let answer second

estimates, we've economic million those So also a now the are Texas, where, it's as to excited the become X incremental One, rapidly. Connecticut, states X things. are And X locations very have to the we're building really million estimates all of we we're in don't customer that our scale cost as our Florida, have construction combination to some there. penetration also do California, already refined and advantages we million fiber attractive in dynamics still of where examples adjacency the with and million build. and our states assets because copper operations. X The to that of of because includes but much can be marketing to X the base, converted where

So bit both. it's a of

profile, just terms of than higher by of still but the return the virtue lower per cost attractive. some Wave overall X of it's it's passing, In

high to it call versus we'll construction. mid-teens at teens. mid- I'd So But get continue to better

eventually and with better fiber. we're we'll penetration, get reach I to excited think those

Okay.

on copper versus which then noticeably And jumped QX. Okay. a ARPU, question Understood. pretty

generally, To you more bit how out a function nonpaying it maybe trade-off a for was to the about And subscribers what bit customers keeping I just legacy like-for-like versus to think increase? on up think price a of versus degree pushing price a sequentially. longer. about broadband is that then churning try between down hang about to on talk

Yes. Nick, this is Scott, too.

the copper most by So price was ARPU increases. driven of growth

have just We into customers. increases -- the price relationship normal built into with built our

disconnects fuel, what's and so the as And the passing -- And mentioned, your last increase in trade-off nonpaid lot that was And most of Nick weren't allowed pressures between ARPU input other second that as of up of copper things. pricing, inflationary our then on growth. by of a that most electricity the was right driven went churn costs we question of was in year.

I drive prices haven't big price up a churn price gone the in them increases -- have because input general, seen economy serve customers cost that we increase think, across to the and in is understand higher. So

believe the fundamentally step do that pricing, winning look, I mean, we on can on in I and market have we just again, if the product here. Scott, take Yes. back build a

price apples here. horse superior that not also in comparing should over that a have time that, fundamentally better believe cable. We're product market. And product They a prices command apples we're things should with we are different command should superior We a because product. than comparing the different the with be car. It's a that

over time, things a brand on. price compared lead that of We're offer. in of we to Chapter so ourselves our XX. the easier legacy those Frontier's in company recognize should of the our to offers making building market. out and deal cable And the greater with, customer stronger kind also as comes Now course, bifurcation improving a we're to it We're of case, rebuilding

Stanley. Our comes next of Morgan Flannery from Simon question

ARPU ARPU on you the Staying topic, had nice improvement. fiber

impacts bit, you last the your changed you to really your as that I of you're think business? expecting slower Could talked from decision-making. said accelerate Any on about half about second gig the to side on enterprise. past, little your And updates in be Some lap of talked of expected on the see mix promotions update haven't And peers us year. touched you in we've you just expectations what growth on you have the a we there? some going forward? then what seeing there? SMB on macro Any should

Sure. this Simon, is Scott.

autopay gift to because in place in year. in half have in that a related QX. those the We year-over-year for the from pricing, Nick second expectation ARPU, X% little still and to It 'XX will easier midyear seem get were and 'XX. ARPU discount last we'll the Let me first have growth of second pass is the promotional the same, but end the card until of the most to one, X, did that QX take and I'll to our one. X% lapped of we have headwinds

So that's one dynamic.

a other increase in is healthy we customers take seeing service. who the our our The of dynamic gig-or-above are percentage

they're in our in expansion XX% an our base it, underlying or those and taking increasingly that will showed taking we build and to between drive and customer a continue ARPU. above, of increase we are as so gig XX% And the slides customers today

I kind reflect X.X progress whole NPS cylinders is that's this, of firing And as working Thanks, guidance. am Yes. think, I been step starting very on or the years question. which on just and drive whatever, that through And now with in enterprise per lot a company on disciplined, to increased back begin focus. scores, the we've things do machine, over year, going. which of all and still now this If service, the but we of there, Scott. really into seen build a improved is on build one take and up determined last the Then you've and accelerating flow our to work the to

process and And improving on and you SMB, where quarter, where our now growth. focus pricing, on, called we so revenue offers the progress go-to-market, This into well. as growth natural consumer of through our sequential through see we which we're I'm went that for see early us. pleased reevaluating flowing customer seeing improving the through very that's as now in with area a And on same our flowing consumer, of out we early

think think enterprise I wholesale. next we the about if think kind you when about and growth, engine of

So was enterprise. your question on

exposed from want that AT&T legacy ability ones. hit for Lumen can't this overall I industry. revenue we targets small We're a fiber with our for enterprise the of shift and away more some year So call in mean, I I customers that to business modern But we Verizon early remain our differs wholesale. market, let's business actually this to the But kind to firstly, that call results materially kind out very recently trends services have are from quarter, just signs roughly saw very confident and from of in very part shared. that to the our in of the enterprise the secular stability of sequentially. out. and get actually fact We flat

the to like expert And buy all needs, our large small us. way, we're than have accounts the of know a They're to we very trends also a of that less in they economics. that we it. very We're accounts way industry off-footprint those they're operators enterprise large in part some demanding So are much on want in because And macro services enterprise exposed industry. footprint, complicated they not from the competitors. We're from insulated that buy.

And power. so those But they we of bargaining have strong competitors. have our than far customers fewer

into look super has there's XX% over in this We've lot revitalize excited. our starting is about of as And many performance mix, revenue enterprise Now improve of And later new in that leadership and, as got of we've an SMB. its But we're many, I own in market in at efforts to think month, going revenue. our time, potential years. segment. fact, turn for engine if our in under-managed it to we that just is been starting think done consumer segment the hope, a do I this I'm I our growth to

Nemoto question next Anthony from of Our comes Citi.

is to own on you falling your continuing DSL of you're conversions? Any how then how fiber targets we should program. to cost run much So think for adds unpack how update your much of reinvested line? ahead the from savings versus gross And could about bottom came the

On about is a plan. message this Anthony, the Scott. we're savings, cost year key ahead is of I think

million take by of out We've savings end to we So taken $XXX XXXX. be out to million. already able of $XXX the expected cost

much we million doing of improvements being falling structural business. $XXX that the at be that how end to additional it of then the on efficient, and reinvested bottom to falls savings number of to bottom to digitizing line line, is this making now. part and very be most is to things, expect the we by So focused then and as versus automating of The year the continue find fewer more hopefully

are in had fall But the of most growth the And being of of investing that's one set our in line. QX, of that reinvesting drove improve plan experience. will the question... to On some these in of EBITDA bottom customer it your in things a we number selective We're ahead out. We digitization opportunities. things the to that it significantly second

making are taking build we more are cost service, the down of business. that important first for automation, It's improve very doing progress and customer What Nick, strategy, customer stopping down the to on fantastic doubling out of being is on a the improve about can that. what the we're question. areas. point. to we clear out, cost just call everything But we ruthless whole taking on the marketing, our brand, efficient offers, not I part is really I across improve want on those in are becoming doubling investing improving of that areas be whilst improve we're stronger key everyone out.

into strategy, strong creates execution, think ultra-efficient and the shareholders behind you. else. Scott, back and cost-out that's strong seen something So our the investment everywhere us stops for And to elsewhere I industry. falling hopefully traps value in we've our that our that customers

And majority on adds. gross on new are The still our your Yes. vast customers. Anthony, gross question of adds second from coming

are are So to to a migrators vast portion, new majority copper our but Frontier. healthy fiber the

Operator, we have time one question. more for

our So final question we'll now. take

Benchmark. question final Our Harrigan comes Matthew from of

with escalation, cost NLP, everything you'll actually that about much happening trend was given works a be mean, be long, it dysfunctional theme, a your continued labor likely to do it for almost time, able with too to margin think that. things happens in know whatever But I going on you Continuing to and decently Does well. inflation, that the fairly to like cost some I mean, now like want that offset potential? long get to you use feels And demographics. like I labor? talk you're upward something don't what's long-term tweak

this Matthew, Scott. is

many yes, as labor U.S. automate a drive people The investing possible. wage inflation, some need the are do inflation we're to is go -- as to of to next so in it as we on and the we is and highlighting automate start our that several now years. whole most the being that. focused answer up. but me find likely that faces That retirements will activities. can workforce will see people, as high efficient value-added cost be really make can, sure and processes Let harder make wave on The we

make it place and to to self-serve easier some of job with out want telematics AI customers customer somebody, call and we so to technicians our figure it for to to easier do so to for call where next to routing make to. their versus be have talk individually service don't somebody they to the the having dispatched And opportunities,

So really, efficient. at looking operation, automate our ways more across are to become we and

Yes.

walls." Not the of important In much improve automate, dollars that the stripped came us are think journey. about the There's efficiency end. is to I case. improve those those when I to this mean, said in and requires has a it the a because talk back in tremendous business down where now, the delivery. we're to thing in notion can as and They've it, we our Just and and a there listen, I'll of for this effectiveness business Nick our digitize bare the we plowing ago Nick right "Okay, business, to think said, the probably opportunity And year of been the I work we effectiveness described. and add I really us, areas efficiency manner are bankruptcy. to that this into ensure Nick investment is

which are run look to all of we turn sort of not with hard efficiency the place. and when you as in right. run of way environment service gets up we out So to remains business that and ways of here, sort when we it's a do it ideas, done. out to improve of things at the road deliver out it you we target-rich a the can that This And the for

those just just less the here. simple the of creating as are long-term focusing on concerned on factors the pressure business fundamentals we about we So execution, kinds are

helps. has that's think I So

joining And everyone, for Matt. call. Thanks, second concludes earnings Thanks, that us. our quarter XXXX

Thank call. today's for concludes joining. This you

lines. now may You disconnect your