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Altice USA, Inc. (ATUS - Free Report) reported mixed second-quarter 2023 results, wherein the bottom line beat the Zacks Consensus Estimate but the top line missed the same. However, both metrics 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 performance in the long run.
Quarter Details
Net income in the quarter declined to $78.3 million or 17 cents per share from $106.2 million or 23 cents per share in the prior-year quarter, primarily due to top-line contraction. The bottom line, however, beat the Zacks Consensus Estimate by 12 cents.
Altice USA, Inc. Price, Consensus and EPS Surprise
Quarterly total revenues slipped to $2,324.3 million from $2,463 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 $2,330 million.
The company made progress in its growth strategies by accelerating network enhancement and customer experience. At the quarter-end, Altice had 2.66 million FTTH (Fiber to the home) passings, about 287,000 of which were added in the April-June period. Broadband-only customer usage averaged 619 GB per month. FTTH broadband net additions were more than 40,000 in the quarter, led by increased migration of existing customers and higher fiber gross additions. Total fiber broadband customers reached 250,000 by the end of the quarter. Residential revenue per customer relationship declined 2.8% year over year to $137.44 due to the loss of higher ARPU video customers.
Residential revenues (which include Broadband, Video and Telephony) were $1,835.2 million, down 5.7% year over year due to a loss in unique residential customers. Business services and wholesale revenues declined to $364.7 million from $371.6 million. News and Advertising revenues were $113.5 million, down 14.8% due to lower contributions from both political and non-political campaigns.
Other Quarterly Details
Operating income declined to $482 million from $521.7 million in the year-ago quarter. Adjusted EBITDA was $921.7 million compared with $1,007.1 million in the prior-year quarter. Optimum Mobile witnessed healthy subscriber growth during the quarter, reaching 264,000 customers, representing a 5.8% penetration of the residential customer base.
Altice has been accelerating the pace of its network extension and remains well on track to reach more than 150,000 passings in 2023. The company is witnessing solid customer penetration, typically reaching approximately 40% within a year of rollout in new-build areas.
Cash Flow & Liquidity
Altice generated $855.7 million of cash from operating activities in the first six months of 2023 compared with $1,276.6 million in the year-ago period. As of Jun 30, 2023, the company’s net debt was $24,964 million.
InterDigital, Inc. (IDCC - Free Report) , sporting a Zacks Rank #1, delivered an earnings surprise of 170.89%, on average, in the trailing four quarters. In the last reported quarter, it pulled off an earnings surprise of 579.03%. It has a long-term earnings growth expectation of 13.9%.
It is a pioneer in advanced mobile technologies that enable wireless communications and capabilities. The company engages in designing and developing a wide range of advanced technology solutions, which are used in digital cellular and wireless 3G, 4G and IEEE 802-related products and networks.
Akamai Technologies, Inc. (AKAM - Free Report) , carrying a Zacks Rank #2, delivered an earnings surprise of 4.9%, on average, in the trailing four quarters. It has a long-term earnings growth expectation of 10%.
Akamai is a global provider of content delivery network and cloud infrastructure services. The company’s solutions accelerate and improve the delivery of content over the Internet, enabling faster response to requests for web pages, streaming of video & audio, business applications, etc. Akamai’s offerings are intended to reduce the impact of traffic congestion, bandwidth constraints and capacity limitations on customers.
Motorola Solutions, Inc. (MSI - Free Report) carries a Zacks Rank #2. It has a long-term earnings growth expectation of 9% and delivered an earnings surprise of 6.9%, on average, in the trailing four quarters.
As a leading provider of mission-critical communication products and services worldwide, Motorola has ensured a steady revenue stream from this niche market. The communications equipment maker intends to boost its position in the public safety domain by entering into strategic alliances with other players in the ecosystem.
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Altice's (ATUS) Q2 Earnings Beat Despite Lower Revenues
Altice USA, Inc. (ATUS - Free Report) reported mixed second-quarter 2023 results, wherein the bottom line beat the Zacks Consensus Estimate but the top line missed the same. However, both metrics 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 performance in the long run.
Quarter Details
Net income in the quarter declined to $78.3 million or 17 cents per share from $106.2 million or 23 cents per share in the prior-year quarter, primarily due to top-line contraction. The bottom line, however, beat the Zacks Consensus Estimate by 12 cents.
Altice USA, Inc. Price, Consensus and EPS Surprise
Altice USA, Inc. price-consensus-eps-surprise-chart | Altice USA, Inc. Quote
Quarterly total revenues slipped to $2,324.3 million from $2,463 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 $2,330 million.
The company made progress in its growth strategies by accelerating network enhancement and customer experience. At the quarter-end, Altice had 2.66 million FTTH (Fiber to the home) passings, about 287,000 of which were added in the April-June period. Broadband-only customer usage averaged 619 GB per month. FTTH broadband net additions were more than 40,000 in the quarter, led by increased migration of existing customers and higher fiber gross additions. Total fiber broadband customers reached 250,000 by the end of the quarter. Residential revenue per customer relationship declined 2.8% year over year to $137.44 due to the loss of higher ARPU video customers.
Residential revenues (which include Broadband, Video and Telephony) were $1,835.2 million, down 5.7% year over year due to a loss in unique residential customers. Business services and wholesale revenues declined to $364.7 million from $371.6 million. News and Advertising revenues were $113.5 million, down 14.8% due to lower contributions from both political and non-political campaigns.
Other Quarterly Details
Operating income declined to $482 million from $521.7 million in the year-ago quarter. Adjusted EBITDA was $921.7 million compared with $1,007.1 million in the prior-year quarter. Optimum Mobile witnessed healthy subscriber growth during the quarter, reaching 264,000 customers, representing a 5.8% penetration of the residential customer base.
Altice has been accelerating the pace of its network extension and remains well on track to reach more than 150,000 passings in 2023. The company is witnessing solid customer penetration, typically reaching approximately 40% within a year of rollout in new-build areas.
Cash Flow & Liquidity
Altice generated $855.7 million of cash from operating activities in the first six months of 2023 compared with $1,276.6 million in the year-ago period. As of Jun 30, 2023, the company’s net debt was $24,964 million.
Zacks Rank & Other Stocks to Consider
Altice currently has a Zacks Rank #2 (Buy).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
InterDigital, Inc. (IDCC - Free Report) , sporting a Zacks Rank #1, delivered an earnings surprise of 170.89%, on average, in the trailing four quarters. In the last reported quarter, it pulled off an earnings surprise of 579.03%. It has a long-term earnings growth expectation of 13.9%.
It is a pioneer in advanced mobile technologies that enable wireless communications and capabilities. The company engages in designing and developing a wide range of advanced technology solutions, which are used in digital cellular and wireless 3G, 4G and IEEE 802-related products and networks.
Akamai Technologies, Inc. (AKAM - Free Report) , carrying a Zacks Rank #2, delivered an earnings surprise of 4.9%, on average, in the trailing four quarters. It has a long-term earnings growth expectation of 10%.
Akamai is a global provider of content delivery network and cloud infrastructure services. The company’s solutions accelerate and improve the delivery of content over the Internet, enabling faster response to requests for web pages, streaming of video & audio, business applications, etc. Akamai’s offerings are intended to reduce the impact of traffic congestion, bandwidth constraints and capacity limitations on customers.
Motorola Solutions, Inc. (MSI - Free Report) carries a Zacks Rank #2. It has a long-term earnings growth expectation of 9% and delivered an earnings surprise of 6.9%, on average, in the trailing four quarters.
As a leading provider of mission-critical communication products and services worldwide, Motorola has ensured a steady revenue stream from this niche market. The communications equipment maker intends to boost its position in the public safety domain by entering into strategic alliances with other players in the ecosystem.