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Altice (ATUS) Q4 Earnings & Revenues Fall Short of Estimates
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Altice USA, Inc. (ATUS - Free Report) reported soft fourth-quarter 2022 results, wherein the bottom line and the top line missed the respective Zacks Consensus Estimate and declined year over year due to a challenging macroeconomic environment. Nevertheless, the company has been accelerating the pace of network rollouts and expects to enhance customer connection with its rebranding campaign, thereby reporting improved performances in the long run.
Net Loss
Net loss in the quarter was $193.1 million or a loss of 43 cents per share against net income of $251.7 million or 56 cents per share in the prior-year quarter, primarily due to top-line contraction. The bottom line missed the Zacks Consensus Estimate by 65 cents.
In 2022, net income declined to $194.6 million or 43 cents per share from $990.3 million or $2.14 per share in 2021.
Altice USA, Inc. Price, Consensus and EPS Surprise
Quarterly total revenues slipped to $2,369.2 million from $2,521.1 million in the prior year, owing to lower contributions from residential and advertising businesses due to macroeconomic uncertainty. The top line missed the consensus estimate of $2,414 million. In 2022, total revenues were $9,647.7 million, down from 10,090.8 million in 2021.
The company made progress in its growth strategies by accelerating network enhancement and customer experience. At quarter-end, Altice had 2.16 million FTTH (Fiber to the home) passings, about 251,000 of which were added in the quarter. Broadband-only customer usage averaged 564 GB per month. FTTH broadband net additions were more than 36,000 in the quarter, led by increased migration of existing customers and higher fiber gross additions. Total fiber broadband customers reached 172,000 by the end of the quarter. Residential revenue per customer relationship declined 2.2% year over year to $134.76 due to the loss of higher ARPU video customers.
Residential revenues (which include Broadband, Video and Telephony) were $1,821.9 million, down 5% year over year due to a loss in unique residential customers of 16,000 and a broadband net loss of 8,000. Business services and wholesale revenues declined to $368.3 million from $406 million. News and Advertising revenues were $151.8 million, down 10.8% due to lower contributions from both political and non-political campaigns.
Other Quarterly Details
Operating income declined to $301.1 million from $598.8 million in the year-ago quarter. Adjusted EBITDA was $913.3 million compared with $1,083 million in the prior-year quarter. Altice rebranded its national mobile service dubbed Altice Mobile to Optimum Mobile as part of its effort to align all the services under a single national Optimum brand. The rechristened Optimum Mobile witnessed healthy subscriber growth during the quarter, reaching 240,000 customers, representing 5.6% penetration of the residential customer base.
Cash Flow & Liquidity
Altice generated $2,366.9 million of cash from operating activities in 2022 compared with $2,854.1 million in 2021. Free cash flow in 2022 was $452.6 million, down 72.1% year over year. As of Dec 31, 2022, the company’s net debt was $24,612 million.
Arista Networks, Inc. (ANET - Free Report) , sporting a Zacks Rank #1, is likely to benefit from the strong momentum and diversification across its top verticals and product lines. The company has a software-driven, data-centric approach to help customers build their cloud architecture and enhance their cloud experience. Arista has a long-term earnings growth expectation of 17.5% and delivered an earnings surprise of 12.7%, on average, in the trailing four quarters.
It holds a leadership position in 100-gigabit Ethernet switching share in port for the high-speed datacenter segment. Arista is increasingly gaining market traction in 200- and 400-gig high-performance switching products and remains well-positioned for healthy growth in data-driven cloud networking business with proactive platforms and predictive operations.
Viavi Solutions Inc. (VIAV - Free Report) , carrying a Zacks Rank #2 (Buy), is a key pick. Headquartered in Scottsdale, AZ, Viavi is a leading provider of network test, monitoring and service enablement solutions to diverse sectors across the globe. The product portfolio of the company offers end-to-end network visibility and analytics that help build, test, certify, maintain, and optimize complex physical and virtual networks.
Viavi also offers high-performance thin film optical coatings for light-management solutions used in anti-counterfeiting, 3D sensing, electronics, automotive, defense and instrumentation markets. It delivered an earnings surprise of 9.1%, on average, in the trailing four quarters.
T-Mobile US, Inc. (TMUS - Free Report) , carrying a Zacks Rank #2, is another key pick. Headquartered in Bellevue, WA, T-Mobile is a national wireless service provider. The company offers services under the T-Mobile, Metro by T-Mobile and Sprint brands. T-Mobile, through its subsidiaries, provides wireless services for branded postpaid and prepaid, and wholesale customers.
It delivered a trailing four-quarter earnings surprise of 212.7%, on average. T-Mobile has a long-term earnings growth expectation of 67.6%.
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Altice (ATUS) Q4 Earnings & Revenues Fall Short of Estimates
Altice USA, Inc. (ATUS - Free Report) reported soft fourth-quarter 2022 results, wherein the bottom line and the top line missed the respective Zacks Consensus Estimate and declined year over year due to a challenging macroeconomic environment. Nevertheless, the company has been accelerating the pace of network rollouts and expects to enhance customer connection with its rebranding campaign, thereby reporting improved performances in the long run.
Net Loss
Net loss in the quarter was $193.1 million or a loss of 43 cents per share against net income of $251.7 million or 56 cents per share in the prior-year quarter, primarily due to top-line contraction. The bottom line missed the Zacks Consensus Estimate by 65 cents.
In 2022, net income declined to $194.6 million or 43 cents per share from $990.3 million or $2.14 per share in 2021.
Altice USA, Inc. Price, Consensus and EPS Surprise
Altice USA, Inc. price-consensus-eps-surprise-chart | Altice USA, Inc. Quote
Revenues
Quarterly total revenues slipped to $2,369.2 million from $2,521.1 million in the prior year, owing to lower contributions from residential and advertising businesses due to macroeconomic uncertainty. The top line missed the consensus estimate of $2,414 million. In 2022, total revenues were $9,647.7 million, down from 10,090.8 million in 2021.
The company made progress in its growth strategies by accelerating network enhancement and customer experience. At quarter-end, Altice had 2.16 million FTTH (Fiber to the home) passings, about 251,000 of which were added in the quarter. Broadband-only customer usage averaged 564 GB per month. FTTH broadband net additions were more than 36,000 in the quarter, led by increased migration of existing customers and higher fiber gross additions. Total fiber broadband customers reached 172,000 by the end of the quarter. Residential revenue per customer relationship declined 2.2% year over year to $134.76 due to the loss of higher ARPU video customers.
Residential revenues (which include Broadband, Video and Telephony) were $1,821.9 million, down 5% year over year due to a loss in unique residential customers of 16,000 and a broadband net loss of 8,000. Business services and wholesale revenues declined to $368.3 million from $406 million. News and Advertising revenues were $151.8 million, down 10.8% due to lower contributions from both political and non-political campaigns.
Other Quarterly Details
Operating income declined to $301.1 million from $598.8 million in the year-ago quarter. Adjusted EBITDA was $913.3 million compared with $1,083 million in the prior-year quarter. Altice rebranded its national mobile service dubbed Altice Mobile to Optimum Mobile as part of its effort to align all the services under a single national Optimum brand. The rechristened Optimum Mobile witnessed healthy subscriber growth during the quarter, reaching 240,000 customers, representing 5.6% penetration of the residential customer base.
Cash Flow & Liquidity
Altice generated $2,366.9 million of cash from operating activities in 2022 compared with $2,854.1 million in 2021. Free cash flow in 2022 was $452.6 million, down 72.1% year over year. As of Dec 31, 2022, the company’s net debt was $24,612 million.
Zacks Rank & Stocks to Consider
Altice currently has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Arista Networks, Inc. (ANET - Free Report) , sporting a Zacks Rank #1, is likely to benefit from the strong momentum and diversification across its top verticals and product lines. The company has a software-driven, data-centric approach to help customers build their cloud architecture and enhance their cloud experience. Arista has a long-term earnings growth expectation of 17.5% and delivered an earnings surprise of 12.7%, on average, in the trailing four quarters.
It holds a leadership position in 100-gigabit Ethernet switching share in port for the high-speed datacenter segment. Arista is increasingly gaining market traction in 200- and 400-gig high-performance switching products and remains well-positioned for healthy growth in data-driven cloud networking business with proactive platforms and predictive operations.
Viavi Solutions Inc. (VIAV - Free Report) , carrying a Zacks Rank #2 (Buy), is a key pick. Headquartered in Scottsdale, AZ, Viavi is a leading provider of network test, monitoring and service enablement solutions to diverse sectors across the globe. The product portfolio of the company offers end-to-end network visibility and analytics that help build, test, certify, maintain, and optimize complex physical and virtual networks.
Viavi also offers high-performance thin film optical coatings for light-management solutions used in anti-counterfeiting, 3D sensing, electronics, automotive, defense and instrumentation markets. It delivered an earnings surprise of 9.1%, on average, in the trailing four quarters.
T-Mobile US, Inc. (TMUS - Free Report) , carrying a Zacks Rank #2, is another key pick. Headquartered in Bellevue, WA, T-Mobile is a national wireless service provider. The company offers services under the T-Mobile, Metro by T-Mobile and Sprint brands. T-Mobile, through its subsidiaries, provides wireless services for branded postpaid and prepaid, and wholesale customers.
It delivered a trailing four-quarter earnings surprise of 212.7%, on average. T-Mobile has a long-term earnings growth expectation of 67.6%.