Core Insights - Glo Fiber has launched its 100% fiber optic broadband service in Greenfield, Ohio, aiming to provide high-speed internet to over 2,300 homes and businesses by the end of 2025 [1] - The service offers symmetrical upload and download speeds of up to 5 Gbps, leveraging Shentel's extensive 18,000-mile fiber network [2][4] - The expansion is expected to enhance local economic development by providing reliable connectivity that supports remote work and education [3] Company Overview - Glo Fiber, powered by Shenandoah Telecommunications Company (Shentel), provides next-generation fiber-to-the-home (FTTH) multi-gigabit broadband internet access, live streaming TV, and digital phone service [4] - The company currently serves over 400,000 homes and businesses across multiple states, including Ohio, Pennsylvania, Virginia, West Virginia, Maryland, and Delaware [4][5] - Glo Fiber differentiates itself with exceptional reliability, straightforward pricing, and local customer service [8] Service Features - The service includes high-speed internet, phone service, video service, and Whole Home Wi-Fi, ensuring seamless connectivity [2] - Glo Fiber utilizes advanced technology such as XGS-PON 10 Gbps networks to deliver reliable and high-speed internet [4] - The company emphasizes easy pricing with no long-term contracts, enhancing customer satisfaction [8]

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Core Points - Shenandoah Telecommunications reported a quarterly loss of $0.2 per share, slightly better than the Zacks Consensus Estimate of a loss of $0.22, but worse than a loss of $0.13 per share a year ago [1][2] - The company achieved an earnings surprise of +9.09% this quarter, having surpassed consensus EPS estimates three times over the last four quarters [2] - Revenues for the quarter ended September 2025 were $89.8 million, exceeding the Zacks Consensus Estimate by 0.44% and up from $87.6 million year-over-year [3] Financial Performance - The stock has added approximately 2.5% since the beginning of the year, while the S&P 500 has gained 17.2% [4] - Current consensus EPS estimate for the upcoming quarter is -$0.17 on revenues of $90.7 million, and for the current fiscal year, it is -$0.79 on revenues of $356.56 million [8] Industry Outlook - The Diversified Communication Services industry, to which Shenandoah Telecom belongs, is currently ranked in the bottom 24% of over 250 Zacks industries, indicating potential underperformance compared to higher-ranked industries [9] - The estimate revisions trend for Shenandoah Telecom was unfavorable prior to the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, suggesting expected underperformance in the near future [7]

Financial Data and Key Metrics Changes - Consolidated revenues reached $89.8 million, an increase of 2.5% year-over-year [7] - Adjusted EBITDA climbed to $29.7 million, up 11.7% year-over-year, with margins expanding 300 basis points to 33% [7][16] - GloFiber revenues grew 41.1%, reaching $21.3 million, driven by a 39.5% increase in revenue-generating units [7][15] Business Line Data and Key Metrics Changes - GloFiber data revenue-generating units grew to 83,000, representing a year-over-year growth of 39.5% [7] - Incumbent broadband markets revenue declined by $1.6 million, primarily due to a 15% decline in video RGUs [15] - Commercial fiber revenue declined by $1.1 million, but excluding variances, it grew 2.3% over the same period in 2024 [15] Market Data and Key Metrics Changes - 92% of GloFiber passings are in duopoly markets with only one fixed broadband competitor [8] - Broadband data penetration in GloFiber expansion markets climbed 2.1 percentage points to 20.6% [9] - Monthly broadband data churn remained steady at 1.17%, with an average revenue per user of approximately $77 [10] Company Strategy and Development Direction - The company is focused on four key pillars: enhancing customer service, completing network expansion, accelerating growth, and achieving positive free cash flow [4][5] - Plans to refinance credit facilities through a hybrid structure to lower cost of debt and increase financial flexibility [6] - The company aims to complete its GloFiber build by the end of 2026, with a focus on driving penetration rates and expanding commercial fiber business [5][6] Management's Comments on Operating Environment and Future Outlook - Management highlighted the importance of operational excellence and strategic agility in a consolidating industry [6] - The company expects to reach positive free cash flow for the full year of 2027, driven by declining capital intensity and continued customer growth [6][22] - Management noted that the GloFiber expansion is nearing completion, which will lead to significant free cash flow starting in 2028 [22] Other Important Information - The company invested $212 million in capital expenditures year-to-date, with 89% of planned government-subsidized passings completed [16] - Liquidity was $230 million on September 30, including $23 million in cash and $118 million in available revolver capacity [17] Q&A Session Summary Question: Thoughts on creating longer-term shareholder value through M&A - Management indicated that the industry is consolidating and they are looking for opportunities to expand their footprint while driving efficiencies [20][21] Question: Pricing action taken with GloFiber - Management responded that a competitive pricing strategy was implemented in response to Comcast's five-year price guarantee, resulting in increased gross ads [24] Question: Why isn't growth leading to raised guidance? - Management explained that growth takes several quarters to accumulate, and customer churn is low, which will lead to significant revenue and EBITDA increases over time [25]

Q3 2025 Highlights - Total revenue reached $89.8 million, a 2.5% year-over-year increase[4] - Adjusted EBITDA grew by 11.8% year-over-year to $29.7 million[4] - Adjusted EBITDA margin expanded by 300 basis points to 33%[4] Glo Fiber Expansion Markets - Glo Fiber expansion markets passed 400,000 locations, with 21,000 released to sales[4] - Data RGUs (Revenue Generating Units) in Glo Fiber expansion markets increased by 39.5% annually[4] - Glo Fiber expansion markets revenue grew by 41.1% annually[4,31] - Year-over-year RGU growth was +37%[8] - Vintage Glo Fiber Expansion Markets Penetration is expected to reach an average terminal penetration of 37%[13] Incumbent Broadband Markets - Approximately 70% of incumbent broadband markets passings have no competitor[5] - Approximately 20% of passings in incumbent broadband markets have FTTH (Fiber to the Home)[18] - Average penetration in Incumbent Broadband Markets Subsidy Cohort is 30%[21] Financial Outlook - The company projects total revenue between $352 million and $357 million for the year ending December 31, 2025, representing an 8.1% increase at the midpoint compared to 2024[38] - Adjusted EBITDA is projected to be between $113 million and $118 million, a 21.6% increase at the midpoint[38]

Revenue Performance - Total revenue for the three months ended September 30, 2025, was $89.8 million, a 2.5% increase from $87.6 million in the same period of 2024[91]. - Revenue from Residential & SMB - Incumbent Broadband Markets decreased by $1.6 million, or 3.6%, primarily due to a 14.9% decline in video revenue generating units[93]. - Revenue from Residential & SMB - Glo Fiber Expansion Markets increased by $6.2 million, or 41.1%, driven by a 41.3% year-over-year growth in data RGUs[95]. - Commercial Fiber revenue decreased by $1.1 million, or 5.3%, but grew 2.3% excluding non-cash deferred revenue adjustments[97]. - RLEC & Other revenue decreased by $1.3 million, or 16.8%, primarily due to lower governmental support revenue and a 21.1% decline in DSL RGUs[99]. - Total revenue for the nine months ended September 30, 2025, was $266.3 million, an increase of $23.6 million or 9.7% compared to $242.6 million in 2024[108]. - Residential & SMB - Glo Fiber Expansion Markets revenue increased by $18.2 million, or 44.1%, driven by a 45.2% year-over-year growth in data RGUs[111][112]. - Commercial Fiber revenue increased by $7.3 million, or 14.1%, with $9.9 million recognized from acquired Horizon markets[113]. Operating Performance - Operating loss for the three months ended September 30, 2025, was $7.2 million, compared to a loss of $4.2 million in the same period of 2024, representing a 71.6% increase in loss[91]. - Operating expenses totaled $288.6 million, an increase of $23.1 million or 8.7% compared to the prior year[108]. - Restructuring, integration, and acquisition expenses decreased by $1.4 million, or 82.5%, compared to the same period in 2024[103]. Financial Expenses - Interest expense increased by $3.1 million, or 85.1%, due to an increase in the Company's outstanding debt[105]. - Interest expense rose by $5.9 million, or 50.6%, due to an increase in outstanding debt[119]. - An increase in market interest rates of 1.00% would add approximately $5.3 million to annual interest expense, given the company's gross variable rate debt of $535.4 million[141]. - Shentel has pay-fixed, receive-variable interest rate swaps totaling $150.0 million, effectively paying a fixed weighted-average interest rate of 2.90%[142]. Tax and Benefits - Income tax benefit increased by $1.4 million, or 92.9%, due to a higher pre-tax loss in the current period[107]. Cash Flow and Liquidity - Net cash provided by operating activities from continuing operations was approximately $74.5 million, an increase of $26.1 million compared to the prior year[129]. - As of September 30, 2025, total available liquidity was $212.6 million, consisting of cash, credit facility availability, and government grant reimbursements[128]. - The company was awarded approximately $151.2 million in grants to serve unserved homes and upgrade network capacity, with $79.1 million received as of September 30, 2025[127]. - Net cash used in investing activities was approximately $209.9 million for the nine months ended September 30, 2025, a decrease of $351.0 million compared to the prior year, primarily due to a $342.4 million decrease in cash disbursed for acquisitions[130]. - Net cash provided by financing activities was approximately $114.1 million during the same period, a decrease of $2.9 million, driven by a $79.4 million decrease in cash inflows from preferred stock issuances[131]. - As of September 30, 2025, the company's net indebtedness was approximately $534.1 million, with a weighted-average interest rate of 7.47% for the Term Loans[132]. - Capital expenditures for the nine months ended September 30, 2025, totaled $251.5 million, exceeding net cash provided by operating activities by $177.1 million, with expectations for continued excess through 2026[136]. - The company expects cash on hand, cash flows from continuing operations, and availability of funds from the Credit Agreement to meet liquidity needs for the next twelve months[135]. Future Outlook and Risks - The company executed an Asset Purchase Agreement in April 2025 to acquire FTTH assets for $5 million, completing the acquisition on July 9, 2025[89]. - Future capital requirements may differ materially from estimates due to demand for products and services and new market developments[137]. - Cash flows from operations could be adversely affected by various external factors, including economic conditions and competition[138]. - The company amended its Credit Agreement to increase the maximum Total Net Leverage Ratio to 4.75:1.00, remaining in compliance with financial covenants as of September 30, 2025[134].

Financial Performance - Total revenue grew by 2.5% year-over-year to $89.8 million in Q3 2025 [5]. - Net loss from continuing operations was $9.4 million in Q3 2025, compared to a loss of $5.3 million in Q3 2024 [5]. - Adjusted EBITDA increased by 11.8% year-over-year to $29.7 million [5]. - The company expects total revenue for 2025 to be in the range of $352 million to $357 million, representing an 8.1% increase from 2024 [10]. - Adjusted EBITDA guidance for 2025 is projected between $113 million and $118 million, a 21.6% increase from 2024 [10]. - Net loss from continuing operations for the nine months ended September 30, 2025, was $(27,570) thousand, compared to a profit of $196,561 thousand in the same period of 2024 [22]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $85,668 thousand, up from $69,102 thousand in 2024, reflecting a year-over-year increase of approximately 24.1% [26]. Capital Expenditures and Liquidity - Capital expenditures for the nine months ended September 30, 2025, were $251.5 million, up from $226.5 million in the same period of 2024 [13]. - Total available liquidity as of September 30, 2025, was $212.6 million, including $22.6 million in cash and cash equivalents [13]. - Proceeds from credit facility borrowings amounted to $125,000 thousand in 2025, significantly higher than $50,000 thousand in 2024, reflecting a 150% increase [22]. Subscriber and Market Growth - Glo Fiber Expansion Markets revenue increased by 41.1% year-over-year to $21.3 million, driven by a 41.3% rise in average subscribers [5]. - The company constructed 20,000 Glo Fiber passings and added approximately 5,800 new Glo Fiber customers in Q3 2025 [6]. - Total homes and businesses passed increased to 648,325 in 2025 from 553,877 in 2024, representing a growth of approximately 17.0% [29]. Asset and Liability Changes - Total assets increased to $1,850,424 thousand in 2025 from $1,740,273 thousand in 2024, representing a growth of approximately 6.35% [20]. - Total current liabilities rose to $135,401 thousand in 2025, compared to $114,571 thousand in 2024, marking an increase of about 18.2% [20]. - Cash and cash equivalents decreased to $22,621 thousand at the end of September 2025 from $46,272 thousand at the end of 2024, a decline of approximately 51.1% [22]. Average Revenue Per User (ARPU) - Incumbent Broadband Markets ARPU increased to $83.57 from $82.90, reflecting a growth of 0.81% [32]. - Glo Fiber Expansion Markets ARPU rose to $77.12, up from $76.97, indicating a growth of 0.19% [32]. - Broadband Data ARPU improved to $81.55, an increase from $80.55, representing a growth of 1.24% [32]. - Video ARPU decreased to $116.37 from $124.99, showing a decline of 6.98% [32]. - Voice ARPU slightly decreased to $34.57 from $32.76, reflecting a decline of 2.48% [32]. - Shentel updated revenue presentation to align with management's view, resulting in revised ARPU values for the prior period [32]. Margin Improvements - Adjusted EBITDA margin expanded from 27% in Q2 2024 to 33% in Q3 2025, reflecting strong business scaling [3]. - The Adjusted EBITDA margin improved to 32% for the nine months ended September 30, 2025, compared to 28% in the same period of 2024 [26].

Core Insights - Shenandoah Telecommunications Company ("Shentel") reported a significant increase in Adjusted EBITDA margin from 27% in Q2 2024 to 33% in Q3 2025, indicating strong operational efficiency following the Horizon acquisition [3][5] - Glo Fiber revenue and subscribers grew by 41% year-over-year, with total passings increasing by 21,000 sequentially to over 400,000 [3][5] Financial Performance - Total revenue for Q3 2025 was $89.8 million, a 2.5% increase compared to Q3 2024 [5] - Glo Fiber Expansion Markets revenue reached $21.3 million, reflecting a 41.1% growth due to a 41.3% increase in average subscribers [5][6] - Net loss from continuing operations was $9.4 million in Q3 2025, compared to a loss of $5.3 million in Q3 2024 [5][28] - Adjusted EBITDA increased by 11.8% to $29.7 million, with the Adjusted EBITDA margin expanding from 30% in Q3 2024 to 33% in Q3 2025 [5][28] Operational Highlights - The company constructed 20,000 Glo Fiber passings and added approximately 5,800 new Glo Fiber customers in Q3 2025 [6] - Residential & SMB - Incumbent Broadband Markets passings grew by 4,000 to a total of 248,000, with 89% of planned passings in previously unserved areas completed [6] - Commercial Fiber revenue declined by $1.1 million, primarily due to non-cash deferred revenue adjustments [6] Capital Expenditures and Financial Outlook - Capital expenditures for the nine months ended September 30, 2025, were $251.5 million, up from $226.5 million in the same period in 2024 [13] - The company reiterated its 2025 financial guidance, projecting total revenue between $352 million and $357 million, and Adjusted EBITDA between $113 million and $118 million [10][11] Liquidity and Debt - As of September 30, 2025, Shentel had total available liquidity of $212.6 million, including $22.6 million in cash and cash equivalents [13] - Total indebtedness was $535.4 million as of September 30, 2025 [13]

Core Points - Shenandoah Telecommunications Company (Shentel) declared a cash dividend of $0.11 per share, marking a 10.0% increase from the previous year's dividend [1][2] - The dividend will be payable on December 1, 2025, to shareholders of record as of November 7, 2025, representing Shentel's sixty-sixth consecutive year of annual dividends [1][2] - The increase in dividend reflects the strong performance of Shentel's Glo Fiber business and the company's confidence in future growth [2] Company Overview - Shentel provides broadband services through high-speed fiber optic and cable networks to residential and commercial customers across eight states in the eastern United States [2] - The company's service offerings include broadband internet, video, voice, high-speed Ethernet, dedicated internet access, dark fiber leasing, and managed network services [2] - Shentel operates an extensive regional network with over 17,700 route miles of fiber [2]

Core Viewpoint - Shenandoah Telecommunications Company (Shentel) is set to release its third quarter 2025 financial results on October 29, 2025, followed by a conference call to discuss the results and business highlights [1]. Company Overview - Shenandoah Telecommunications Company provides broadband services through advanced fiber optic and cable networks to both residential and commercial customers across eight contiguous states in the eastern United States [3]. - The company's service offerings include broadband internet, video, voice, high-speed Ethernet, dark fiber leasing, and managed network services [3]. - Shentel operates an extensive regional network with over 17,700 route miles of fiber [3].