Altice USA is raising its fiber passings goal for 2024 after touting its “best quarter” for fiber net additions.
The operator added 46,000 fiber customers in Q4 2023, ending the period with 341,000 total fiber subscribers. According to Altice, fiber net adds were driven by “both higher fiber gross additions and increased migrations of existing customers.”
Altice CFO Marc Sirota said on an earnings call the company aims to reach a total 3 million homes passed with fiber by end of 2024, as well as add 175,000 new passings, compared to 165,000 in 2023.
In Q3 of last year, Altice reduced its year-end passings target from 900,000 to 600,000 locations after announcing it will temporarily slow down fiber construction due to an internal investigation related to a corruption probe in Altice Portugal.
As a result of fewer fiber passings constructed in the back half of 2023, Sirota said Altice’s capital intensity, which peaked in Q1 at over 25%, “nearly halved” to 12.8% in Q4.
“We are taking a more disciplined approach to our fiber construction by targeting markets that yield the best ROIs, recognizing we have a low move environment which limits how quickly we can grow on this front,” he said.
Altice’s fiber business fared better than its broadband base, as the company posted 27,000 broadband net losses in Q4, compared to a loss of 9,000 in the year-ago period.
The decline was attributed to “additional competitive pressure” during the holiday season as well as a continued low move environment.
On the pricing front, Altice recently reduced non-promotional rates for its fiber internet tiers by $30-$50. The cut to rack rates was slightly offset by an increase in Altice’s “Network Enhancement Fee,” according to a New Street Research note from January.
Customers not under a promotional rate will see a $1.50 increase, to $6 per month, in their January 2024 bills, said New Street’s Jonathan Chaplin at the time.
CEO Dennis Mathew said the new pricing structure “is really to address what our customers are telling us.”
“They've told us they want simplicity, transparency, predictability. They want the right value for what they're paying,” he said. “And we believe that the new structure will do just that.”
Mathew added more than 100,000 Optimum customers “received a speed upgrade tied to this evolution.”
Q4 financials
Consolidated revenue of $2.3 billion was down 3% year on year. Residential revenue of $1.8 billion dropped 2.8%, primarily due to the loss of higher ARPU video customers over the last year.
Business Services revenue of $372 million was up 1% and included 9% revenue growth from Altice subsidiary Lightpath. Revenue from Altice’s News and Advertising segment dropped 16% to $128.1 million, when taking into account political advertising revenue.
Net loss attributable to Altice shareholders was $117.8 million.