Verizon Communications on Friday said that it's ending its diversity, equity and inclusion (DEI) programs amid a probe by the Trump administration into those practices, as the telecom giant seeks federal approval for an acquisition. Federal Communications Commission (FCC) Chair Brendan Carr criticized Verizon in February for its promotion of DEI programs, saying it could factor into the review of Verizon's planned acquisition of Frontier Communications for $20 billion, including debt. Verizon said in a lett ...

Core Insights - Frontier Communications reported revenue of $1.51 billion for the quarter ended March 2025, reflecting a year-over-year increase of 3.4% and matching the Zacks Consensus Estimate, with an EPS of -$0.26 compared to $0.00 in the previous year [1] - The company achieved an EPS surprise of +21.21%, exceeding the consensus estimate of -$0.33 [1] Financial Performance - Revenue from contracts with customers was $1.50 billion, surpassing the average estimate of $1.49 billion, marking a 3.4% increase year-over-year [4] - Revenue from Fiber-Consumer services reached $589 million, exceeding the estimate of $581.81 million, with a year-over-year growth of 16.6% [4] - Revenue from Fiber-Business and Wholesale was $324 million, above the estimate of $321.75 million, representing an 8% increase year-over-year [4] Customer Metrics - Broadband customers totaled 3.15 million, slightly above the estimated 3.14 million [4] - Total Fiber Penetration stood at 30.7%, marginally higher than the estimated 30.6% [4] - Fiber-Consumer broadband customers numbered 2.35 million, exceeding the estimate of 2.34 million [4] Stock Performance - Shares of Frontier Communications have returned +1.1% over the past month, contrasting with the Zacks S&P 500 composite's -0.8% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Frontier Communications, which belongs to the Zacks Communication - Network Software industry, posted revenues of $1.51 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 0.34%. This compares to year-ago revenues of $1.46 billion. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on man ...

Financial Performance - The company reported operating income of $76 million for the three months ended March 31, 2025, a decrease of 16% from $90 million in the same period in 2024 [191]. - Total revenue for the three months ended March 31, 2025, was $1.511 billion, a 3% increase from $1.462 billion in the same period in 2024 [212]. - Consumer revenue increased by 3% to $813 million, driven by a 26% increase in fiber broadband revenue, which was attributed to higher average revenue per user (ARPU) and net customer additions [218]. - Business and wholesale revenue also rose by 3% to $682 million, primarily due to increases in data and internet services, despite declines in voice services revenue [220]. - Total operating expenses for the three months ended March 31, 2025, were $1,435 million, an increase of $63 million or 5% compared to $1,372 million in 2024 [234]. - Operating cash flows increased by $184 million to $519 million for the three months ended March 31, 2025, compared to the same period in 2024 [258]. Fiber Expansion - Frontier Communications has passed over 8 million total locations with fiber as of March 31, 2025, with a goal to reach 10 million [184]. - Fiber revenue increased by 13% to $913 million for the three months ended March 31, 2025, compared to $805 million in the prior year [214]. - The average monthly consumer fiber broadband revenue per customer (ARPU) rose by $3.03, or 5%, to $68.21 for the three months ended March 31, 2025 [209]. - Frontier added approximately 321,000 fiber passings and 107,000 fiber broadband customer net additions in the first quarter of 2025 [188]. - The company experienced a consumer customer churn rate of 1.20% for fiber broadband, an improvement from 1.24% in the prior year [205]. Capital Expenditures and Investments - Capital expenditures increased to $757 million for the three months ended March 31, 2025, compared to $666 million in the prior year [262]. - The company has negotiated payment terms with vendors, resulting in capital investment of $773 million for the three months ended March 31, 2025, including vendor financing [266]. - Cash flows used by investing activities were $756 million for the three months ended March 31, 2025, a decrease driven by $91 million in higher capital expenditures and the non-recurrence of $850 million in sales of short-term investments [261]. Debt and Liquidity - As of March 31, 2025, the company had liquidity of approximately $2,529 million, consisting of $506 million in cash and cash equivalents and available credit facilities [250]. - The working capital deficit increased to $1,516 million as of March 31, 2025, compared to $1,029 million at December 31, 2024, driven by various increases in current liabilities [256]. - As of March 31, 2025, there was $1,267 million of undrawn capacity under the $1,500 million DDTL Facility [265]. - The company assessed that operating cash flows and existing cash balances will be adequate to finance working capital requirements and other payments over the next twelve months [269]. - The financial maintenance covenant leverage ratio is set to not exceed 5.25:1.00, stepping down to 4.75:1.00 starting March 31, 2027 [281]. Pension and Employee Benefits - The company's pension plan assets increased by $42 million from $2,328 million at December 31, 2024, to $2,370 million at March 31, 2025, primarily due to market value changes and contributions [317]. - The discount rate for the company's pension benefit obligation was 5.50% as of March 31, 2025, down from 5.60% at the end of 2024 [314]. Regulatory and Compliance - The company is required to complete the CAF Phase II deployment by December 31, 2021, and could face penalties if it fails to meet certain requirements [295]. - The company was awarded approximately $371 million over ten years under the RDOF program to build gigabit-capable broadband to approximately 127,000 locations in eight states, with milestones to be met from December 31, 2025, to December 31, 2028 [297]. - The company is actively pursuing awards from the IIJA, which provides $65 billion for broadband connectivity programs, with approximately $25.5 billion allocated to states in its footprint [298]. - The company is in compliance with all covenants under its existing indentures and credit agreements as of March 31, 2025 [290]. Market and Shareholder Information - The merger agreement with Verizon is set at $38.50 per share, representing a premium of 43.7% to Frontier's 90-day volume-weighted average share price prior to market speculation [185]. - The company issued $750 million in secured fiber network revenue term notes on July 1, 2024, with a weighted average yield of approximately 7.4% [276]. - As of March 31, 2025, 90% of the company's total debt had fixed interest rates, with only $1.1 billion subject to floating rates [310]. - The annual impact of a 100 basis points increase in the SOFR would result in approximately $11 million of additional interest expense, provided that the SOFR rate exceeds the SOFR floor [311]. - The company does not maintain any off-balance sheet arrangements that would materially affect its financial statements [292].

Exhibit 99.1 Frontier Reports First-Quarter 2025 Results DALLAS, Texas, April 29, 2025 -- Frontier Communications Parent, Inc. (NASDAQ: FYBR) ("Frontier") reported first-quarter 2025 results today. "We had the strongest start to a year yet, led by continued strength in our fiber business," said Nick Jeffery, President and Chief Executive Officer of Frontier. "Consumers, business owners and technology companies are increasingly relying on fiber to power networks and connect to the digital economy – and that ...

Core Insights - Frontier Communications reported revenue of $1.51 billion for the quarter ended December 2024, reflecting a year-over-year increase of 5.6% [1] - The company's EPS was -$0.47, a decline from $0.07 in the same quarter last year, indicating a significant EPS surprise of -147.37% compared to the consensus estimate of -$0.19 [1] Financial Performance - Revenue exceeded the Zacks Consensus Estimate of $1.47 billion by 2.52% [1] - Revenue from contracts with customers was $1.49 billion, surpassing the average estimate of $1.46 billion, with a year-over-year change of +5.8% [4] - Revenue from video services was $79 million, down 18.6% compared to the previous year [4] Customer Metrics - Broadband customers totaled 3.09 million, slightly below the estimated 3.11 million [4] - Fiber revenue from consumer services was $557 million, aligning closely with the estimate of $557.64 million, representing a year-over-year increase of 15.1% [4] - Broadband net adds for business and wholesale fiber were 5 thousand, exceeding the average estimate of 4.6 thousand [4] Market Performance - Shares of Frontier Communications returned -0.1% over the past month, while the Zacks S&P 500 composite increased by 2.6% [3] - The stock currently holds a Zacks Rank 2 (Buy), suggesting potential outperformance in the near term [3]

Financial Performance - Frontier Communications reported a quarterly loss of $0.47 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.19, marking an earnings surprise of -147.37% [1] - The company posted revenues of $1.51 billion for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 2.52% and showing an increase from $1.43 billion year-over-year [2] - Over the last four quarters, Frontier Communications has surpassed consensus revenue estimates four times, but has only exceeded EPS estimates once [2] Stock Performance and Outlook - Frontier Communications shares have increased by approximately 2.9% since the beginning of the year, compared to the S&P 500's gain of 4.5% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to those expectations [4] - The current consensus EPS estimate for the upcoming quarter is -$0.27 on revenues of $1.49 billion, and for the current fiscal year, it is -$1.11 on revenues of $5.98 billion [7] Industry Context - The Communication - Network Software industry, to which Frontier Communications belongs, is currently ranked in the top 16% of over 250 Zacks industries, indicating a favorable outlook for the sector [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5] - The favorable estimate revisions trend ahead of the earnings release has resulted in a Zacks Rank 2 (Buy) for Frontier Communications, suggesting that the shares are expected to outperform the market in the near future [6]

Revenue Growth and Customer Metrics - Frontier Communications reported a revenue growth of 3% year-over-year, with fiber revenue increasing by 14% to $3.402 billion, while copper revenue declined by 8% to $2.471 billion[220]. - The company achieved fiber broadband customer growth of 19%, adding 385,000 net fiber broadband customers, resulting in a total of approximately 2.249 million consumer fiber broadband customers[204]. - The total number of broadband customers increased by 2% to 3.193 million, driven by net additions of fiber broadband customers[215]. - Consumer revenue increased by 2% to $3,163 million, driven by growth in fiber data and value-added services, despite declines in voice and video services[227]. - Business and wholesale revenue rose by 5% to $2,710 million, primarily due to increases in fiber broadband and network access services[225]. Financial Performance - Total revenue for the year ended December 31, 2024, was $5,937 million, a 3% increase from $5,751 million in 2023[223]. - Operating income decreased to $353 million for the year ended December 31, 2024, down from $492 million in 2023, primarily due to declines in voice and video services revenue[205]. - Total operating expenses increased by 6% to $5,584 million, with significant increases in depreciation and amortization expenses by 15%[240]. - Interest expense rose by $151 million, or 23%, to $804 million, driven by a higher debt balance[253]. - Cash flows from operating activities increased by $277 million to $1,621 million for the year ended December 31, 2024, primarily due to changes in working capital[262]. Merger and Acquisition - The company entered into a Merger Agreement with Verizon, with Verizon set to acquire Frontier for $38.50 per share, representing a 43.7% premium[202]. - The company expects to close the merger with Verizon by the first quarter of 2026, pending regulatory approvals[202]. Cost Savings and Efficiency - Frontier achieved $597 million in gross annualized cost savings since 2021, exceeding its initial target of $250 million[204]. - The company anticipates that its operating cash flows and existing cash balances will be sufficient to meet its working capital and capital expenditure needs over the next twelve months[271]. Capital Expenditures and Investments - Cash flows used by investing activities decreased to $1,681 million in 2024 from $2,556 million in 2023, attributed to a $428 million reduction in capital expenditures[265]. - Capital expenditures for 2024 were $2,783 million, down from $3,211 million in 2023, with a shift in capital payments classified as financing activities[266]. Debt and Liquidity - As of December 31, 2024, the company had liquidity of approximately $2,910 million, including cash and cash equivalents of $750 million[255]. - The company has total long-term debt obligations of $11,569 million, with interest obligations of $3,748 million, and total future contractual obligations amounting to $15,987 million[291]. - The company has $1,500 million in DDTL Facility and $925 million in Revolving Facility available for liquidity, with $265 million reserved for letters of credit[269]. Pension and Benefit Obligations - The unfunded benefit obligation for the company's pension and other postretirement benefit plans was $630 million as of December 31, 2024, with cash contributions of $171 million made during the year[309]. - The company’s expected long-term rate of return on pension plan assets was adjusted to 6.65% for the period from October 1, 2024, to December 31, 2024, down from 7.50%[312]. - The company’s actual return on pension plan assets for the year ended December 31, 2024, was a gain of 5%[312]. Regulatory and Compliance - As of December 31, 2024, the company was in compliance with all covenants under existing indentures and the Amended and Restated Credit Agreement[287]. - The financial maintenance covenant leverage ratio is set to not exceed 5.25:1.00 starting June 30, 2024, with a step-down to 4.75:1.00 beginning March 31, 2027[280]. Market and Risk Management - The company does not hold or issue derivative instruments for trading purposes, indicating a conservative approach to market risk management[318]. - The company has no significant equity security investments outside of its pension plan assets, limiting its exposure to equity price risk[324]. - The company aims to limit the impact of interest rate changes on earnings and cash flows while lowering overall borrowing costs[320].

Revenue Growth - Frontier achieved full-year organic revenue growth for the first time in over 15 years, driven by a 19.2% increase in fiber customers and a 13.5% increase in fiber revenues[3]. - The company reported total revenue of $5.94 billion for the full year 2024, with operating income of $353 million and Adjusted EBITDA of $2.25 billion[7]. - For the fourth quarter of 2024, revenue was $1.51 billion, a 5.6% increase year-over-year, with Adjusted EBITDA of $595 million, up 8.4% year-over-year[11]. - Revenue for Q4 2024 was $1,506 million, up from $1,426 million in Q4 2023, representing a 5.6% increase[31]. - Total revenue for the year ended December 31, 2024, was $5,937 million, compared to $5,751 million in 2023, reflecting a 3.2% growth[33]. Customer Growth - In 2024, Frontier added a record 385,000 fiber broadband customers, resulting in a year-over-year growth of 19.2%[7]. - The company added 97,000 fiber broadband customers in Q4 2024, resulting in a customer growth of 19.8% year-over-year[11]. - Broadband customers increased to 3,094 thousand, up from 2,943 thousand year-over-year, representing a growth of 5.1%[37]. - Net customer additions for broadband were 37 thousand in Q4 2024, compared to 30 thousand in Q4 2023, reflecting a 23.3% increase[37]. - The number of broadband customers at the end of December 2024 was 2,861 thousand, up from 2,700 thousand a year earlier, indicating a 5.9% increase[49]. Financial Performance - The company generated net cash from operations of $1.62 billion for the full year 2024[11]. - Net cash provided from operating activities for the year was $1,621 million, an increase from $1,344 million in the previous year, representing a growth of 20.6%[43]. - Operating free cash flow for the year ended December 31, 2024, was $(1,625) million, an improvement from $(1,871) million in 2023[45]. - The company reported a net loss of $118 million for Q4 2024, compared to a net income of $17 million in Q4 2023[41]. - For the three months ended December 31, 2024, the net loss was $118 million compared to a net loss of $82 million for the previous quarter[45]. Capital Expenditures and Investments - Frontier's total capital investment for 2024 was $3.25 billion, including cash capital expenditures of $2.78 billion[7]. - Capital expenditures for Q4 2024 were $792 million, an increase from $329 million in Q4 2023[31]. - Capital expenditures for the year were $2,783 million, down from $3,211 million year-over-year, a reduction of 13.3%[43]. Debt and Liquidity - As of December 31, 2024, Frontier had total liquidity of $2.9 billion, with a net leverage ratio of approximately 4.8x[12]. - Long-term debt increased to $11,551 million from $11,246 million year-over-year, reflecting a rise of 2.7%[39]. - The net leverage ratio stood at 4.8x as of December 31, 2024, indicating a stable leverage position[39]. Future Prospects - Frontier is in the process of being acquired by Verizon, with the transaction expected to close by the first quarter of 2026[13][14]. - The company is pursuing a proposed merger with Verizon, which may impact future operational and financial performance[29]. Operational Metrics - Consumer fiber broadband ARPU increased to $65.54, reflecting a 3.4% year-over-year growth[7]. - Average monthly consumer revenue per customer rose to $83.58, up from $82.54 year-over-year, indicating a growth of 1.26%[37]. - Customer monthly churn improved to 1.68% from 1.43% year-over-year, showing a decrease of 0.25 percentage points[37]. - The estimated total fiber penetration rate as of December 31, 2024, was 30.6%, compared to 30.2% in the previous quarter[49]. - The EBITDA margin for the quarter ended December 31, 2024, was 34.2%, slightly up from 33.3% in the previous quarter[45].

Core Viewpoint - Frontier Communications (FYBR) is expected to report a quarterly loss of $0.19 per share, a significant decline of 371.4% year-over-year, while revenues are projected to increase by 3% to $1.47 billion [1]. Financial Projections - The consensus EPS estimate has remained unchanged over the past 30 days, indicating analysts have not revised their projections [2]. - Analysts predict 'Revenue- Revenue from contracts with customers' to reach $1.46 billion, reflecting a year-over-year increase of 3.3% [5]. - 'Revenue- Subsidy and other revenue' is estimated at $15.33 million, indicating a decline of 9.8% year-over-year [5]. - 'Revenue- Video services' is projected to be $78.16 million, showing a decrease of 19.4% year-over-year [5]. Customer Metrics - 'Revenue- Fiber- Consumer' is expected to reach $557.64 million, a year-over-year increase of 15.2% [6]. - The estimate for 'Broadband Customers - Consumer - Copper' is 619.62 thousand, down from 822 thousand a year ago [6]. - Total 'Broadband Customers - Consumer' is projected at 2.88 million, compared to 2.7 million the previous year [6]. Average Revenue Per User (ARPU) - 'Broadband ARPU - Consumer - Fiber' is expected to be $66.12, up from $64.16 in the same quarter last year [7]. - 'Broadband ARPU - Consumer - Copper' is projected at $58.02, compared to $54.22 a year ago [7]. - 'Broadband ARPU - Consumer - Total' is estimated at $64.34, an increase from $61.02 in the previous year [8]. - 'Broadband ARPU - Business - Fiber' is expected to reach $100.22, up from $98.86 year-over-year [8]. - 'Broadband ARPU - Business - Copper' is projected at $62.42, compared to $59.87 a year ago [8]. - The average prediction for 'Broadband ARPU - Business - Total' is $85.33, compared to $80.17 the previous year [9]. Market Performance - Shares of Frontier Communications have returned +0.3% over the past month, while the Zacks S&P 500 composite has increased by +4.7% [9]. - With a Zacks Rank 2 (Buy), FYBR is anticipated to outperform the overall market in the near future [10].