Liberty Broadband(LBRDA) - 2025 Q1 - Quarterly Report

Acquisition and Divestiture - Liberty Broadband entered into a definitive agreement for Charter to acquire Liberty Broadband, with the transaction expected to close on June 30, 2027, subject to customary closing conditions[134][136]. - The GCI Divestiture is expected to be taxable to Liberty Broadband and its stockholders, with potential corporate level tax liability exceeding $420 million[137]. Financial Performance - Consolidated revenue increased by $21 million to $266 million for the three months ended March 31, 2025, compared to $245 million in the prior year[152][153]. - Operating income rose by $15 million to $43 million for the same period, with GCI Holdings contributing an increase of $19 million[152][154]. - Adjusted OIBDA increased by $14 million to $99 million, driven by improved performance at GCI Holdings[158][167]. - Net income for the three months ended March 31, 2025, was $268 million, up from $241 million in the prior year[176]. - Cash flow from operating activities increased to $78 million, compared to $52 million in the prior year, primarily due to higher operating income[180]. - Interest expense decreased by $11 million to $40 million, attributed to lower outstanding amounts on the Margin Loan Facility and reduced interest rates[161]. - Share of earnings from affiliates increased by $38 million to $318 million, reflecting improved net income at Charter[162]. - Operating expenses, excluding stock-based compensation, decreased by $49 million to $8,095 million, driven by lower programming costs[166]. - The loss on dilution of investment in affiliates decreased by $10 million, primarily due to gains from Charter's repurchase of Liberty Broadband shares[170]. - As of March 31, 2025, Liberty Broadband had a cash and cash equivalents balance of $226 million[180]. - Net cash flows from investing activities for the three months ended March 31, 2025, were $300 million, compared to $81 million in 2024[182]. - Capital expenditures for the three months ended March 31, 2025, were approximately $49 million, slightly up from $46 million in 2024[183]. - Projected cash uses for 2025 include approximately $200 million for net capital expenditures and $115 million for interest payments on outstanding debt[184]. GCI Holdings Performance - GCI Holdings' business growth is heavily dependent on economic conditions in Alaska, which are currently facing recessionary pressures due to volatility in oil prices and inflation[139][140]. - GCI Holdings has experienced inflation-sensitive cost pressures in 2024 and 2025, impacting materials, labor, and other critical business items[141]. - The U.S. Court of Appeals for the Fifth Circuit ruled the FCC's Universal Service Fund (USF) program unconstitutional, which could disrupt GCI Holdings' USF support and negatively affect revenue[142]. - GCI Holdings' customers may face challenges in obtaining credit, potentially leading to increased accounts receivable and bad debt expense if economic conditions worsen[140]. - Total revenue for GCI Holdings for the three months ended March 31, 2025, was $266 million, an increase of 8.6% from $245 million in 2024[188]. - Consumer data revenue increased by $1 million to $61 million, while consumer wireless revenue rose by $3 million to $50 million for the same period[189]. - Business data revenue increased by $20 million to $128 million, driven by service upgrades with existing healthcare and education customers[192]. - Operating income for the three months ended March 31, 2025, was $56 million, up from $37 million in 2024[188]. - GCI Holdings' cable modem subscribers decreased to 155,800 from 159,800, while wireless lines in service increased to 202,300 from 199,000[187]. - As of March 31, 2025, GCI Holdings had $458 million in variable rate debt with a weighted average interest rate of 6.2% and $600 million in fixed rate debt with a weighted average interest rate of 4.8%[200]. - GCI Holdings plans to exit the video business in 2025, subject to regulatory approvals[191]. Charter's Strategic Initiatives - Charter added 514,000 mobile lines in Q1 2025, with improved Internet and video losses compared to the prior year, driven by a new pricing and packaging strategy launched in September 2024[146]. - Charter spent $468 million on its subsidized rural construction initiative in Q1 2025, activating approximately 89,000 subsidized rural passings[149]. - Charter is upgrading its network to deliver symmetrical and multi-gigabit speeds, launching 2x1 Gbps service in two markets in January 2025, with plans for further launches[149]. - Charter's new brand platform, Life Unlimited, emphasizes advanced network capabilities and offers lower promotional pricing to enhance customer value[146].