Executive Summary

Q2 2025 consolidated revenue was $300.7M and Adjusted EBITDA $242.6M (~81% margin); diluted EPS was -$0.04 and AFFO per diluted share was $0.36 .
Versus S&P Global consensus, revenue modestly missed ($304.0M* vs $300.8M actual) and EPS materially missed ($0.192* vs -$0.015 actual Primary EPS); 5 EPS and 6 revenue estimates contributed to consensus (bold miss), while management had flagged consensus as too high for standalone Q2 .
Post-close of the Windstream merger on Aug 1, 2025, Uniti issued combined FY25 guidance: revenue $2.215–$2.265B, net loss $(125)–$(75)M, and Adjusted EBITDA $1.110–$1.160B; interest expense ~$665M .
Strategic positives included hyperscaler demand (20-year IRU, ~$100M TCV) and a $1.5B hyperscaler funnel; Uniti collapsed debt silos and improved debt maturity profile, positioning for accelerated FTTH builds and capital optimization .
Key stock narrative catalysts: hyperscaler lease-up economics, combined company guidance reset (loss outlook tied to integration/interest), and accelerated Kinetic fiber build/penetration trajectory .

What Went Well and What Went Wrong

What Went Well

Hyperscaler demand accelerating: Windstream signed a 20-year IRU (~500 miles) with a major hyperscaler for ~$100M TCV; lease-up on existing strands with minimal capex/opex and ROFR on additional strands .
Strategic fiber revenue growth: Core recurring strategic fiber revenue grew ~5% YoY; unit-level growth strong (Fiber Infrastructure +7% YoY; Kinetic fiber-based revenue +19% YoY) .
Capital structure progress: Issued $600M 8.625% Senior Unsecured Notes due 2032 and redeemed $500M of 10.50% secured notes; collapsed legacy debt silos post-merger to simplify capital stack .

What Went Wrong

EPS and revenue miss vs Street: Q2 Primary EPS actual was -$0.015 vs $0.192 consensus*; revenue was $300.8M vs $304.0M consensus* (bold miss), with management noting standalone consensus was too high .
Elevated interest expense and transaction costs weighed on GAAP profitability: Net loss of $10.7M with net interest expense $160.8M and $13.5M transaction-related costs in Q2 .
Legacy services headwinds and Solutions decline: Pro forma consolidated revenue down ~6% YoY driven by TDM runoff and Solutions decline, partially offset by fiber growth .

Financial Results

Consolidated Results vs Prior Periods

Metric	Q2 2024	Q1 2025	Q2 2025
Revenue ($USD Millions)	$294.9	$293.9	$300.7
Diluted EPS ($USD)	$0.00	$0.05	$(0.04)
Adjusted EBITDA ($USD Millions)	$236.7	$237.8	$242.6
Adjusted EBITDA Margin (%)	~80%	~81%	~81%
AFFO per diluted share ($USD)	$0.34	$0.35	$0.36

Notes: Q2 2025 revenue +~2% YoY; Adjusted EBITDA up sequentially and YoY; diluted EPS swung to a loss due to higher net interest and transaction costs .

Estimates vs Actuals (S&P Global)

Metric	Q2 2025 Consensus*	Q2 2025 Actual (S&P Primary)	Surprise
Primary EPS ($USD)	$0.192*	$(0.015)*	Miss: $(0.208)*
Revenue ($USD Millions)	$304.0*	$300.8*	Miss: $(3.2)* (~1.1%)*
Primary EPS - # of Estimates	5*	—	—
Revenue - # of Estimates	6*	—	—

Values retrieved from S&P Global.*

Segment Breakdown (Q2 2025)

Segment	Revenue ($USD Millions)	Adjusted EBITDA ($USD Millions)	Adj. EBITDA Margin
Uniti Leasing	$226.5	$220.1	~97%
Uniti Fiber	$74.3	$28.8	~39%
Corporate	—	$(6.3)	—

KPIs (Q2 2025)

KPI	Value
Consolidated bookings (MRR)	~$1.2M (pro forma Uniti+Windstream)
Leverage (Net Debt/Annualized Adj. EBITDA)	5.75x
Unrestricted cash and cash equivalents	~$740.7M
Cash & equiv (balance sheet)	$240.7M
AFFO attributable to common ($USD Millions)	$96.5
Kinetic fiber homes passed	1.7M (end Q2)
Kinetic fiber subscribers	483k (+15% YoY)
Cost per passing (strategic builds)	$850–$950 forward; blended $750–$850 over program

Guidance Changes

Metric	Period	Previous Guidance (Legacy Uniti, May 6)	Current Guidance (Combined, Aug 5)	Change
Revenue ($USD Billions)	FY 2025	$1.196–$1.216	$2.215–$2.265	Raised (scope to combined)
Net income/(loss) to common ($USD Millions)	FY 2025	$90–$110	$(125)–$(75)	Lowered (integration/interest)
Adjusted EBITDA ($USD Millions)	FY 2025	$966–$986	$1,110–$1,160	Raised (scope to combined)
Interest expense, net ($USD Millions)	FY 2025	~$535	~665	Raised

Guidance frame shifted from standalone to consolidated post-merger, including five months of Windstream contribution (~$1.0B revenue and ~$160M Adjusted EBITDA) .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2024 and Q1 2025)	Current Period (Q2 2025)	Trend
AI/hyperscaler demand	Emphasized Generative AI/convergence themes and strong wholesale demand; ABS financing and bookings strength	$1.5B hyperscaler funnel; 20-year IRU (~$100M TCV); lease-up economics with minimal capex/opex	Accelerating
Regulatory backdrop	Standard REIT disclosures; merger prep; debt maturity work	FCC favorable stance on copper retirement; state PUCs deregulatory moves aiding fiber conversions	Improving
Capital structure	ABS $589M closed; redeemed part of 10.50% notes; maturities extended	$600M 8.625% unsecured notes; $500M redemption; collapsed silos; targeting leverage 5.5–6.0x YE	Strengthening
Kinetic FTTH build	Plan to accelerate fiber coverage; 2.0M homes by YE2025; penetration targets	1.7M homes passed; 483k fiber subs; 3.5M homes by 2029; blended cost/pass $750–$850	Accelerating
Managed Solutions (former Windstream Enterprise)	TDM exit in progress; shift to strategic IP	Solutions revenue/EBITDA declining near term; TDM exit by YE; NPV >$1B targeted from retained high-margin base	Declining, stabilizing by 2028
Legacy services headwinds	Noted declines in TDM/legacy segments	Pro forma consolidated revenue down ~6% YoY due to legacy runoff	Ongoing headwind

Management Commentary

“The combination creates a premier insurgent fiber provider... uniquely positioned to benefit from... convergence and Generative AI.” — Kenny Gunderman, CEO
“We expect to pass 3,500,000 homes with fiber within the Kinetic footprint by 2029... and about 75% of total revenue will be fiber-based by 2029.” — CEO prepared remarks
“On a combined basis, our hyperscaler funnel represents about $1.5 billion of total contract value... our win rate... is very high.” — CEO Q&A
“Standalone Uniti Q2 results... were ahead of our expectations... analysts’ consensus estimates... were too high for Q2 and too low for 2025.” — Paul Bullington, CFO
“Cost per passing... $850–$950 going forward; blended $750–$850 over the life of the program.” — CFO

Q&A Highlights

Hyperscaler funnel/win rates: Selective pursuit with high win rates; reliability and build capability trump price; $1.5B funnel expected to work through in 6–18 months .
AI inference phase: Shift toward lease-up, higher-margin, lower-capital hyperscaler deals expected earlier than prior timelines .
Kinetic build economics and coverage: Fiber to 75–80% of footprint with direct FTTH; remaining served via fixed wireless leveraging fiber-to-the-node; rural builds often subsidized (RDOF/PPP/BEAD) .
ARPU dynamics: Solid ARPU in line with competitors; growth via upsell to higher speeds; modem rental excluded in slide ARPU .

Estimates Context

Q2 2025 revenue and EPS missed S&P Global consensus: revenue $300.8M vs $304.0M consensus*, EPS (Primary) -$0.015 vs $0.192* (bold miss). 6 revenue and 5 EPS estimates underpinned consensus*. Management had indicated consensus was too high for standalone Uniti in Q2 .
Values retrieved from S&P Global.*

Key Takeaways for Investors

Combined FY25 guidance reset reflects integration and higher interest burden; watch delivery vs $2.215–$2.265B revenue and $1.110–$1.160B Adjusted EBITDA as integration progresses .
Hyperscaler lease-up momentum is a key upside driver with attractive unit economics and minimal capital intensity (20-year IRU signed; $1.5B funnel) .
Accelerated Kinetic FTTH build should expand fiber revenue mix and reduce churn; blended cost/pass suggests compelling IRR potential vs peers .
Legacy Solutions/TDM runoff will weigh on consolidated growth near term; management targets stabilization by 2028 with significant NPV from retained base .
Capital structure optimization (debt silos collapsed, unsecured issuance, redemptions) supports long-term deleveraging; monitor interest expense trajectory (~$665M FY25 guide) .
Near-term estimate revisions likely trend lower for EPS given GAAP net loss guide; revenue may shift higher on combined scope; watch Street recalibration post-merger .
Strategic narrative remains positive (AI, convergence, regulatory tailwinds); execution against hyperscaler pipeline and Kinetic build cadence are primary stock catalysts .

Uniti Group Inc. (UNIT)·Q2 2025 Earnings Summary