Earnings
Altice Chairman and CEO: ‘The competition is fiercer than ever, but our ability to compete continues to improve every day.’
Photo of Altice Chairman and CEO Dennis Mathew
Cable ISPs Continue to Face Pressure from Fixed Wireless Access Competition
WASHINGTON, May 2, 2024 – Like Comcast Corp. and Charter Communications, Altice USA is feeling the pinch of competition.
Altice reported first quarter earnings Thursday, posting a loss of 30,000 broadband subscribers, compared to a loss of 19,000 during the same quarter in 2023. In the previous quarter, Altice lost 27,000 broadband customers.
Last week, Comcast reported a first quarter loss of 65,000 broadband subscribers and Charter reported losing 72,000 broadband subscribers during the same quarter.
Meanwhile, while not growing as fast as they once were, T-Mobile reported adding 405,000 fixed wireless access service subscribers in the first quarter while Verizon said its FWA service added 354,000.
“The competition is fiercer than ever, but our ability to compete continues to improve every day,” said Altice Chairman and CEO Dennis Mathew on a call today with Wall Street analysts.
Altice’s broadband subscriber losses were concentrated in the residential sector.
He said the company was focused on disciplined, profitable growth to restore broadband as a leader in adding customers.
Mathew said data consumption trends gave him confidence in the ability of the Altice network to outperform fixed wireless, which key cable executives view as a capacity-constrained service akin to slow-speed Digital Subscriber Line service once used extensively by phone companies.
“We continue to see data consumption increasing. In Q1, the average monthly data usage of our broadband-only base was over 700 gigabytes of data, which has grown 13% since Q1 last year. Additionally, the top 10% of the residential customer base uses more than 2 terabytes of data a month,” Mathew said.
Nevertheless, Mathew said the company will continue to face headwinds in the future because of high interest rates, high mortgage rates, and housing starts down 30% in the company’s northeast footprint.
“There’s just less jump balls, less calls coming into the call center, less shoppers online,” Mathew said.
Total revenue was down 1.9% year over year
Altice, the third largest publicly traded cable broadband ISP, said total revenue of $2.3 billion was down 1.9% year over year and residential revenue of $1.8 billion was down 2.9% year over year. Net income was a loss of $21.2 million, or $0.05 per share, compared to a first quarter 2023 gain of $25.9 million, or $0.06 per share.
Operating free cash flow in the first quarter was $510.5 million, up 78.8% year over year. Altice reported free cash flow of $63.6 million in the first quarter.
Altice, based in Long Island City, N.Y., said it added 45,000 fiber passings in the quarter to reach 2.8 million fiber passings overall. The company continues to target about 3 million passings by year end 2024.
Altice’s wireless division, Optimum Mobile, added 29,000 lines in the first quarter, compared to 8,000 additions during the same quarter last year.
Mobile penetration of the consumer broadband base was 5.3% at the end of the first quarter, up from 3.5% at the end of the first quarter 2023. About 64% of mobile customers were on an unlimited plan for the period ended March 31.
Altice said it lost 77,000 residential video subscribers and 63,100 residential telephone customers in the first quarter.
