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Liberty Broadband(LBRDA) - 2024 Q2 - Quarterly Report

Financial Performance - GCI Holdings reported revenue of $246 million for Q2 2024, a slight increase from $245 million in Q2 2023, with total revenue for the first half of 2024 remaining flat at $491 million[107]. - Operating income for GCI Holdings decreased to $30 million in Q2 2024 from $32 million in Q2 2023, while it increased to $67 million for the first half of 2024 compared to $61 million in the same period last year[109]. - Adjusted OIBDA for GCI Holdings was $86 million in Q2 2024, down from $92 million in Q2 2023, with a total of $176 million for the first half of 2024 compared to $182 million in the prior year[110]. - Charter's revenue increased by $26 million and $52 million for the three and six months ended June 30, 2024, respectively, driven by growth in residential mobile service, residential Internet, and enterprise revenue[118]. - Net income for the three months ended June 30, 2024, was $1,423 million, compared to $1,413 million for the same period in 2023, while net income for the six months ended June 30, 2024, was $2,703 million, compared to $2,596 million in 2023[118]. - Cash provided by operating activities increased to $79 million for the six months ended June 30, 2024, compared to a cash outflow of $55 million in the prior year[130]. - Capital expenditures for the six months ended June 30, 2024, were $123 million, compared to $97 million in the prior year[131]. - Other expenses, net increased by $30 million and $66 million for the three and six months ended June 30, 2024, respectively, compared to the prior year[121]. - Consumer data revenue increased by $2 million for the six months ended June 30, 2024, driven by higher recurring monthly charges from subscribers[139]. - Business data revenue increased by $5 million for the six months ended June 30, 2024, primarily due to increased sales to health care customers[141]. Customer Dynamics - Charter lost 149,000 Internet customers in Q2 2024 but added 557,000 mobile lines, indicating challenges in customer retention due to the end of the FCC's Affordable Connectivity Program[103]. - Charter's mobile line growth was supported by new offerings such as the Spectrum One package and the Anytime Upgrade program, enhancing customer experience and retention[104]. - As of June 30, 2024, the company had 158,000 cable modem subscribers, a decrease from 159,600 in the prior year[137]. Economic and Market Conditions - The Alaska economy, which GCI Holdings is heavily reliant on, faces recessionary pressures due to volatility in oil prices and inflation, potentially impacting demand for GCI's services[100]. - GCI Holdings is monitoring inflation-sensitive costs closely, which could affect its ability to maintain margins if costs continue to rise[101]. - Changes in Universal Service Fund programs, including the RHC Program, could materially impact GCI Holdings' revenue and financial position[102]. Operating Expenses - Operating expenses, excluding stock-based compensation, increased by $20 million for the three months ended June 30, 2024, but decreased by $149 million for the six months ended June 30, 2024, compared to the prior year[119]. - Operating expenses increased by $3 million for both the three and six months ended June 30, 2024, primarily due to higher distribution costs[142]. - Selling, general and administrative expenses rose by $4 million and $3 million for the three and six months ended June 30, 2024, respectively, mainly due to increased labor costs[143]. Debt and Financing - As of June 30, 2024, the company had $1.15 billion available for borrowing under its Margin Loan Agreement[135]. - The company closed a private offering of $860 million of its 3.125% Exchangeable Senior Debentures due 2054 on July 2, 2024[135]. - The company expects to use approximately $80 million for net capital expenditures and $100 million for interest payments on outstanding debt for the remainder of 2024[134]. - The company is in compliance with all debt maintenance covenants as of June 30, 2024[135]. Tax and Interest - Interest expense remained flat for the three months ended June 30, 2024, but increased by $6 million for the six months ended June 30, 2024, compared to the prior year[115]. - The effective income tax rate for the three and six months ended June 30, 2024, was 23% and 22%, respectively, consistent with the prior year[126].