Altice USA(ATUS)2025-02-13 22:29Customer Base and Services - Altice USA serves approximately 4.6 million residential and business customers across 21 states, with a total of 9.8 million passings as of December 31, 2024[9]. - Total residential customer relationships decreased to 4,173.7 thousand in 2024 from 4,363.1 thousand in 2023[16]. - Broadband revenue for 2024 was 3,824,472 in 2023, while mobile revenue increased to 77,012[17]. - The FTTH network passed approximately 3.0 million homes and businesses, offering symmetrical speeds up to 8 Gbps[18]. - In 2024, Altice USA launched three new video offerings: Entertainment TV, Extra TV, and Everything TV, aimed at modernizing its video service[26]. - As of December 31, 2024, Lightpath had approximately 16,800 locations connected to its fiber network, covering about 11,300 unique route miles[31]. - Altice USA's mobile service includes a full infrastructure MVNO agreement with T-Mobile, providing enhanced control over its mobile offerings[28]. Financial Performance - Revenue for 2024 was 9,237,064 in 2023[11]. - Adjusted EBITDA for 2024 was 25.1 billion as of December 31, 2024, which poses significant risks in the event of downturns in business or the economy[171]. - Capital expenditures were 1,704.8 million, and $1,914.3 million in 2024, 2023, and 2022, respectively, primarily for customer premise equipment and network infrastructure[184]. Competition - The competitive landscape includes major players like AT&T, Verizon, and Frontier, with ongoing competition from both fixed and wireless broadband services[69]. - Verizon and other fiber-based service providers can sell fiber services to approximately two-thirds of households in the New York metropolitan area[70]. - The company faces intense competition in video services from cable providers and direct broadcast satellite providers like DirecTV and DISH Network[71]. - Competition in video services also includes streaming platforms such as Netflix, Hulu, Disney+, and others, which deliver extensive on-demand and live content[72]. - The business telecommunications market is highly competitive, with local incumbent telephone companies and various national and regional competitors[76]. Regulatory Environment - The FCC regulates utility company rates for pole and conduit space, which could significantly increase annual costs for the company if adverse changes occur[98]. - The company is subject to program access rules that prohibit unfair discrimination against unaffiliated distributors, which could impact competitive dynamics[99]. - The FCC's program carriage rules prevent the company from requiring unaffiliated programmers to grant financial interests or exclusive rights, affecting programming negotiations[100]. - The company must comply with various FCC regulations regarding access for persons with disabilities, ensuring closed captions and audio accessibility[107]. - The company is subject to various federal, state, and local laws regarding subscriber privacy, data security, and data protection, including the California Consumer Privacy Act (CCPA) which took effect on January 1, 2020[133]. Operational Challenges - Programming costs have increased beyond customary inflation rates, particularly for broadcast and sports programming, with expectations for continued increases[47]. - The company faces challenges in negotiating favorable programming contracts, with disputes potentially leading to customer dissatisfaction and loss[161]. - The expiration of retransmission agreements may result in increased costs that cannot be passed on to customers, adversely affecting the company's financial condition[162]. - Rapid technological changes and evolving consumer preferences necessitate continuous investment in new technologies to remain competitive[156]. - The company relies on a limited number of vendors for customer premise equipment, which poses risks related to third-party dependencies[63]. Employee and Labor Relations - As of December 31, 2024, the company had approximately 10,900 employees, with about 89% based in the U.S.[78]. - The company is committed to providing a competitive total incentive program to attract and retain talent, including performance-based compensation and comprehensive benefits[79]. - Approximately 400 employees are represented by unions, and collective bargaining agreements may increase expenses and affect operational changes[205]. - Labor disruptions could adversely affect the company's financial condition and operational efficiency[206]. Environmental and Technological Risks - The company may face increased costs and operational impacts due to environmental regulations and compliance obligations[136]. - Severe weather events and climate change may lead to significant business disruptions and increased costs[198]. - Cybersecurity incidents could harm operations and reputation, with past incidents resulting in exposure of sensitive information[202]. - The use of AI technology presents risks that could lead to legal or regulatory challenges, impacting the company's reputation[204].