Vikash Harlalka

Vikash Harlalka asked about the strategic rationale behind offering a 5-year price guarantee plan, its impact on ARPU growth, and Shentel's current M&A strategy and preferred target characteristics.

Answer

Ed McKay, President and CEO, stated that the 5-year price guarantee was a response to competition, which initially impacted gross additions but not churn. He anticipates a short-term ARPU decline of about 1% over the next few quarters in Glo Fiber markets before stabilization. Regarding M&A, Mr. McKay emphasized the current focus on completing the build plan, accelerating customer growth, and achieving positive free cash flow by 2027. He indicated future M&A interest would be in pure-play fiber providers, with less interest in cable and no interest in copper assets.

Vikash Harlalka asked about the strategic rationale behind Shentel's 5-year price guarantee plan, its impact on ARPU growth, and the company's current M&A strategy, including preferred characteristics for potential fiber acquisition targets.

Answer

Ed McKay, President and Chief Executive Officer, stated that the 5-year price guarantee was introduced in response to a large cable competitor, which initially impacted Shentel's gross additions. He anticipates a short-term ARPU decline of approximately 1% over the next few quarters in Glo Fiber markets before stabilization. Regarding M&A, Mr. McKay emphasized Shentel's current focus on completing its build plan, accelerating customer growth, and achieving positive free cash flow by 2027. He indicated future M&A interest would primarily be in pure-play fiber providers, with less interest in cable and no interest in copper assets.

Vikash Harlalka asked for more insight into the slowing pace of fiber migrations in Q4 2025, the strategy for 2026, and long-term fiber outlook. He also asked about further opportunities to reduce non-programming costs in 2026.

Answer

Chairman and CEO Dennis Mathew explained that the slowdown in fiber migrations was a deliberate decision to refine the process for cost efficiency and maximizing customer lifetime value, with plans to accelerate in the second half of 2026 after strategy refinement. He reiterated bullishness on fiber due to churn and NPS benefits. CFO Marc Sirota highlighted a nearly 9% reduction in OpEx in 2025, driven by workforce transformation and marketing rebalancing, and sees continued opportunities in 2026 through AI leverage and optimizing truck rolls and phone calls.

Vikash Harlalka asked for more insight into the slowing pace of fiber migrations in Q4, Optimum's strategy for 2026, and long-term views on fiber. He also inquired about further opportunities to reduce non-programming costs in 2026.

Answer

Chairman and CEO Dennis Mathew expressed bullishness on fiber due to churn and NPS benefits, noting new builds are fiber-rich. He explained the slowdown in migrations was a deliberate decision to refine processes for cost efficiency and maximizing customer lifetime value (CLV), aiming to accelerate migrations in the second half of 2026 after developing a scalable strategy. CFO Marc Sirota highlighted a nearly 9% reduction in OpEx in 2025, driven by workforce transformation, marketing rebalancing, and lower consulting costs. He stated that 2026 will involve strategic investments but also continued optimization through AI, reducing truck rolls and phone calls. Mathew added that early AI results show a 12% increase in digital interactions and a nearly 20% reduction in dispatch rate for the year, with more opportunities ahead.

Vikash Harlalka asked about Charter's market share trends in fiber-competitive markets and the expected EBITDA growth for the year, excluding political advertising.

Answer

President and CEO Chris Winfrey explained that Charter has competed well against fiber for many years, maintaining greater penetration in mature fiber markets and observing limited overbuild impact. He noted that overbuilders are not reaching their ROI goals. CFO Jessica Fischer addressed EBITDA growth, stating it's challenged by broadband subscriber declines but aims for slight growth through mobile expansion, internet mix, operational improvements, and expense management, with political advertising adding about a percentage point.

Vikash Harlalka (New Street Research) asked Chris Winfrey about Charter Communications' market share trends in long-standing fiber-competitive markets and its future evolution. He also asked Jessica Fischer if the company expects EBITDA growth to exceed 1% this year, considering the impact of political advertising.

Answer

Chris Winfrey, President and CEO, stated that Charter has competed well against fiber for many years, maintaining greater penetration even in mature fiber markets, with overbuild impact limited to a few percentage points of internet penetration in the first year. Jessica Fischer, CFO, indicated that while EBITDA growth is challenged by broadband subscriber declines, the company aims to overcome this through mobile growth, positive ARPU growth from internet mix changes, operational improvements, and expense management, making higher than 1% growth a possibility.

Vikash Harlalka requested an update on TDS Telecom's mobile MVNO launch, details on the step-up pricing for its aggressive gigabit internet offers, and clarification on the types of M&A assets the company is considering for its fiber business.

Answer

Kristina Bothfeld, VP of Finance & CFO at TDS Telecommunications, reported that the TDS Mobile MVNO product launched across all markets in Q2 2025 after a phased rollout. She explained that aggressive promotional pricing typically steps up after two years, but the company is testing various strategies. Walter Carlson, President & CEO of TDS, added that the company is in the early stages of evaluating M&A, with a focus on fiber assets that are synergistic with its current footprint.

Vikash Harlalka of New Street Research sought clarification on TDS Telecom's fiber expansion, asking about the mix of new footprint versus A-CAM upgrades, the profile of new build locations, and funding. He also asked why UScellular's wireless partnerships and certain spectrum were not sold.

Answer

An executive from TDS Telecom and CFO Vicki Villacrez confirmed the fiber program includes both new greenfield expansion and copper-to-fiber conversions via the A-CAM program, with funding potentially accelerated by transaction proceeds. Laurent Therivel, CEO of UScellular, explained the wireless partnerships were retained as they are attractive, high-cash-flow financial assets. He added that the remaining spectrum was not sold because the company did not receive bids that met its valuation criteria of being above book and market value.

Vikash Harlalka from New Street Research asked about the balance between improving broadband subscriber trends and slowing ARPU growth, seeking an outlook for both in the second half of the year. He also asked about the remaining debt capacity on HFC assets via ABS.

Answer

CEO & Chairman Dennis Mathew acknowledged competitive headwinds but expressed confidence that hyper-local, income-constrained, and MDU strategies would continue to stabilize subscriber trends. On ARPU, he pointed to new value-added services like Total Care and Whole Home WiFi as drivers for future growth. CFO Marc Sirota added that the initial ABS perimeter covers only about 700,000 customers out of 10 million passings, implying significant further capacity.

Vikash Harlalka from New Street Research sought clarification on TDS Telecom's fiber build, asking about the mix of A-CAM versus new expansion locations, the competitive profile of new markets, and build costs. He also asked why UScellular did not fully 'clean up' its wireless partnerships and why certain spectrum was not sold.

Answer

Chris Bousfield, TDS Telecom CFO, clarified the expansion includes both new footprint growth and converting copper to fiber in ILEC markets via the A-CAM program. Vicki Villacrez, TDS CFO, added that these are greenfield builds in high-growth areas. UScellular CEO Laurent Therivel responded that the wireless partnerships are valuable, cash-flow-positive assets not in need of a 'clean up,' and the remaining spectrum was not sold because the offers received did not meet their valuation criteria.