Crown Castle(CCI) - 2025 Q2 - Quarterly Results

Company Overview Company Profile Crown Castle Inc. owns, operates, and leases shared communications infrastructure across the U.S., and is selling its Fiber Business for $8.5 billion, operating as a REIT - Crown Castle Inc. owns, operates, and leases shared communications infrastructure, including approximately 40,000 towers, 105,000 small cells, and 90,000 route miles of fiber[15] - The company signed a definitive agreement on March 13, 2025, to sell its small cells and fiber solutions businesses (Fiber Business) for $8.5 billion, with results presented as discontinued operations[17][18] - Crown Castle operates as a Real Estate Investment Trust (REIT) for U.S. federal income tax purposes[19] Strategy The company's strategy focuses on growing cash flows from its tower portfolio, returning capital to stockholders, and efficient capital investment, driven by strong U.S. tower demand - The company's strategy aims to create long-term stockholder value by growing cash flows from existing towers, returning cash to stockholders via dividends and share repurchases, and investing capital efficiently[21][23] - The strategy is based on the belief that the U.S. is the most attractive market for towers, driven by rapid and continuing growth in data demand[21][22] General Company Information This section details Crown Castle Inc.'s corporate information, including executive offices, NYSE trading symbol (CCI), fiscal year end, and long-term credit ratings | Attribute | Detail | | :--------------------------------- | :----------------------------------- | | Principal executive offices | 8020 Katy Freeway, Houston, TX 77024 | | Common shares trading symbol | CCI | | Stock exchange listing | New York Stock Exchange | | Fiscal year ending date | December 31 | | Fitch - Long-term Issuer Default Rating | BBB+ | | Moody's - Long-term Corporate Family Rating | Baa3 | | Standard & Poor's - Long-term Local Issuer Credit Rating | BBB | Tower Asset Portfolio Footprint This section visually represents Crown Castle's tower asset portfolio footprint, illustrating the geographic dispersion of its U.S. communications infrastructure - The section includes a visual representation (map, not provided in text) of the company's tower asset portfolio footprint, indicating its geographic dispersion across the U.S.[25][26] Historical Common Stock Data Historical common stock data from Q2 2024 to Q2 2025 shows quarterly trends in stock prices, dividends, shares outstanding, and market capitalization Historical Common Stock Data (Q2 2024 - Q2 2025, in millions, except per share amounts) | (in millions, except per share amounts) | 6/30/24 | 9/30/24 | 12/31/24 | 3/31/25 | 6/30/25 | | :------------------------------------- | :------ | :------ | :------- | :------ | :------ | | High price (a) | $98.42 | $115.83 | $114.66 | $106.24 | $107.94 | | (a) Low price | $85.90 | $89.79 | $86.50 | $81.93 | $90.17 | | Period end closing price (b) | $92.34 | $113.61 | $88.32 | $103.12 | $102.73 | | Dividends paid per common share | $1.57 | $1.57 | $1.57 | $1.57 | $1.06 | | Volume weighted average price for the period (a) | $91.48 | $104.65 | $98.93 | $92.69 | $100.18 | | Common shares outstanding, at period end | 435 | 435 | 435 | 435 | 435 | | (c) Market value of outstanding common shares, at period end | $40,126 | $49,374 | $38,385 | $44,903 | $44,736 | - Dividends paid per common share decreased from $1.57 in Q1 2025 to $1.06 in Q2 2025[28] - Common shares outstanding remained stable at 435 million across all reported quarters[28] Executive Management Team This section lists Crown Castle's executive management team, detailing their age, tenure, and current positions, including Interim President and CEO, and COOs Executive Management Team | Name | Age | Years with Company | Position | | :------------------ | :-- | :----------------- | :-------------------------------------------------- | | Daniel K. Schlanger | 51 | 9 | Interim President and Chief Executive Officer | | Sunit Patel | 63 | <1 | Executive Vice President and Chief Financial Officer | | Catherine Piche | 54 | 13 (a) | Executive Vice President and Chief Operating Officer - Towers | | Christopher D. Levendos | 57 | 7 | Executive Vice President and Chief Operating Officer - Fiber | | Edward B. Adams, Jr. | 56 | 8 | Executive Vice President and General Counsel | Board of Directors The Board of Directors section lists company directors, their positions, committee assignments, age, and years of service - The Board of Directors includes P. Robert Bartolo as Chair, with various directors serving on committees such as Nominating and Governance, Finance, Fiber Review, CEO Search, Audit, and Compensation and Human Capital[34] Research Coverage This section lists the equity research analysts and rating agencies providing coverage for Crown Castle Inc - The company is covered by numerous equity research firms including Bank of America, Barclays, BMO Capital Markets, Citigroup, Deutsche Bank, Goldman Sachs, Green Street, HSBC, Jefferies, JMP Securities, JPMorgan, KeyBanc, MoffettNathanson, Morgan Stanley, New Street Research, Raymond James, RBC Capital Markets, Scotiabank, TD Cowen, UBS, Wells Fargo, and Wolfe Research[34] - Rating agencies providing coverage include Fitch, Moody's, and Standard & Poor's[34] Outlook Outlook Crown Castle's Full Year 2025 Outlook projects site rental revenues between $3,997 million and $4,042 million, Adjusted EBITDA between $2,780 million and $2,830 million, and AFFO per share between $4.14 and $4.25 Full Year 2025 Outlook (as of July 23, 2025, in millions, except per share amounts) | (in millions, except per share amounts) | Full Year 2025 Outlook | | :------------------------------------- | :--------------------- | | Site rental billings | $3,895 to $3,925 | | Site rental revenues | $3,997 to $4,042 | | Site rental costs of operations | $972 to $1,017 | | Services and other gross margin | $75 to $105 | | Net income (loss) | $100 to $380 | | Net income (loss) per share—diluted | $0.23 to $0.87 | | Adjusted EBITDA | $2,780 to $2,830 | | Depreciation, amortization and accretion | $678 to $773 | | Income (loss) from discontinued operations, net of tax | ($830) to ($590) | | FFO | $1,645 to $1,675 | | AFFO | $1,805 to $1,855 | | AFFO per share | $4.14 to $4.25 | | Interest expense and amortization of deferred financing costs, net | $972 to $1,017 | - The outlook for net income (loss) and net income (loss) per share-diluted includes contributions from the Fiber Business, which is presented as discontinued operations[39][40] Outlook for Components of Changes in Site Rental Revenues The Full Year 2025 Outlook for site rental revenues projects $3,997 million to $4,042 million, with core leasing and escalators offset by Sprint Cancellations Full Year 2025 Outlook for Components of Changes in Site Rental Revenues (dollars in millions) | (dollars in millions) | Full Year 2025 Outlook | | :------------------------------------------------------------------------------------------------ | :--------------------- | | Prior year site rental billings | $3,931 | | Core leasing activity | $110 to $120 | | Escalators | $90 to $100 | | Non-renewals | $(35) to $(25) | | Other billings | $5 to $5 | | Organic Contribution to Site Rental Billings as Adjusted for Impact of Sprint Cancellations | $170 to $200 | | Non-renewals associated with Sprint Cancellations | $(205) to $(205) | | Organic Contribution to Site Rental Billings | $(35) to $(5) | | Straight-lined revenues | $(15) to $15 | | Amortization of prepaid rent | $80 to $110 | | Other revenues | $15 to $15 | | Acquisitions | — to — | | Total site rental revenues | $3,997 to $4,042 | - Year-over-year site rental revenues are projected to decrease by 5.8%[43] - Organic Contribution to Site Rental Billings as Adjusted for Impact of Sprint Cancellations is projected at 4.7% of prior year site rental billings, while the overall Organic Contribution to Site Rental Billings (including Sprint Cancellations) is projected at (0.5)%[43] Outlook for Components of Interest Expense Crown Castle's Full Year 2025 Outlook projects net interest expense and amortization of deferred financing costs between $972 million and $1,017 million Full Year 2025 Outlook for Components of Interest Expense (in millions) | (in millions) | Full Year 2025 Outlook | | :------------------------------------------------------- | :--------------------- | | Interest expense on debt obligations | $960 to $1,000 | | Amortization of deferred financing costs and adjustments on long-term debt | $20 to $30 | | Capitalized interest | $(15) to $(5) | | Interest expense and amortization of deferred financing costs, net | $972 to $1,017 | - The outlook for interest expense relates to continuing operations only[45] Financial Highlights Summary Financial Highlights Q2 2025 financial highlights show net revenues of $1,060 million, net income of $291 million, Adjusted EBITDA of $705 million, and AFFO per share of $1.02 Summary Financial Highlights (Q1 2024 - Q2 2025, in millions, except per share amounts) | (in millions, except per share amounts) | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | | :------------------------------------- | :------ | :------ | :------ | :------ | :------ | :------ | | Net revenues | $1,114 | $1,107 | $1,117 | $1,119 | $1,061 | $1,060 | | Total costs of operations | $272 | $274 | $271 | $268 | $268 | $278 | | Selling, general and administrative | $114 | $136 | $93 | $92 | $93 | $99 | | Net income (loss) | $311 | $251 | $303 | $(4,768) | $(464) | $291 | | Adjusted EBITDA | $754 | $727 | $777 | $777 | $722 | $705 | | Depreciation, amortization and accretion | $191 | $180 | $181 | $183 | $177 | $175 | | Interest expense and amortization of deferred financing costs, net | $226 | $230 | $236 | $240 | $236 | $243 | | FFO | $478 | $436 | $466 | $483 | $451 | $429 | | AFFO | $484 | $449 | $525 | $523 | $479 | $444 | | Weighted-average common shares outstanding— diluted | 435 | 435 | 436 | 435 | 436 | 437 | | Net income (loss) per share—diluted | $0.71 | $0.58 | $0.70 | $(10.97) | $(1.07) | $0.67 | | AFFO per share | $1.11 | $1.03 | $1.20 | $1.20 | $1.10 | $1.02 | - Net income (loss) and net income (loss) per share-diluted include amounts from the Fiber Business, which is presented in discontinued operations[49] - Site rental billings decreased from $967 million in Q2 2024 to $961 million in Q2 2025[49] Components of Changes in Site Rental Revenues Q2 2025 site rental revenues were $1,008 million, a 5.3% year-over-year decrease, primarily due to negative organic contribution from Sprint Cancellations Components of Changes in Site Rental Revenues (Q1 2024 - Q2 2025, dollars in millions) | (dollars in millions) | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | | :------------------------------------------------------------------------------------------------ | :------ | :------ | :------ | :------ | :------ | :------ | | Prior year site rental billings | $923 | $922 | $952 | $966 | $966 | $966 | | Core leasing activity | $28 | $28 | $27 | $28 | $28 | $28 | | Escalators | $23 | $23 | $23 | $24 | $24 | $24 | | Non-renewals | $(8) | $(7) | $(8) | $(8) | $(7) | $(7) | | Other billings | — | $2 | — | $(4) | $3 | — | | Organic Contribution to Site Rental Billings as Adjusted for Impact of Sprint Cancellations | $43 | $45 | $43 | $40 | $49 | $45 | | Non-renewals associated with Sprint Cancellations | — | — | — | — | $(51) | $(51) | | Organic Contribution to Site Rental Billings | $43 | $45 | $43 | $40 | $(2) | $(6) | | Straight-lined revenues | $57 | $54 | $28 | $20 | $19 | $20 | | Amortization of prepaid rent | $41 | $39 | $39 | $40 | $25 | $23 | | Other revenues | $4 | $4 | $4 | $4 | $4 | $4 | | Total site rental revenues | $1,068 | $1,064 | $1,066 | $1,070 | $1,011 | $1,008 | - Site rental revenues decreased by 5.3% year-over-year in both Q1 and Q2 2025[55] - The Organic Contribution to Site Rental Billings was negative in Q1 2025 ($(2) million) and Q2 2025 ($(6) million), primarily due to non-renewals associated with Sprint Cancellations[55] Summary of Capital Expenditures Total capital expenditures for Q2 2025 were $40 million, with discretionary capital expenditures, mainly for tower improvements and land interests, totaling $33 million Summary of Capital Expenditures (Q1 2024 - Q2 2025, dollars in millions) | (dollars in millions) | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | | :------------------------------------------ | :------ | :------ | :------ | :------ | :------ | :------ | | Discretionary capital expenditures: | | | | | | | | Towers improvements and other capital projects | $26 | $20 | $21 | $18 | $15 | $17 | | Purchases of land interests | $13 | $11 | $14 | $20 | $18 | $16 | | Total discretionary capital expenditures | $39 | $31 | $35 | $38 | $33 | $33 | | Sustaining capital expenditures | $8 | $9 | $6 | $12 | $7 | $7 | | Total capital expenditures | $47 | $40 | $41 | $50 | $40 | $40 | | Less: Prepaid rent additions | $12 | $8 | $13 | $12 | $10 | $11 | | Capital expenditures less prepaid rent additions | $35 | $32 | $28 | $38 | $30 | $29 | - Capital expenditures exclude amounts related to the Fiber Business, which are presented in discontinued operations[62] Portfolio Highlights As of June 30, 2025, Crown Castle's portfolio includes 40,000 towers with 2.4 tenants per tower, $29 billion in contracted receivables, and a 6-year average contract term Portfolio Highlights (as of June 30, 2025) | (as of June 30, 2025) | Value | | :------------------------------------------ | :---- | | Number of towers (in thousands) | 40 | | Average number of tenants per tower | 2.4 | | Remaining contracted tenant receivables (in billions) | $29 | | Weighted average remaining tenant contract term (years) | 6 | | Percent of towers in the Top 50 / 100 Basic Trading Areas | 56% / 71% | | Percent of ground leased / owned | 57% / 43% | | Weighted average maturity of ground leases (years) | 36 | - The portfolio highlights relate to continuing operations only and exclude renewal terms at tenants' option for contracted receivables and contract term[63] Consolidated Return on Invested Capital Consolidated Return on Invested Capital (ROIC) decreased to 10.4% in Q2 2025 (LQA) from 10.9% in Q2 2024 (LQA), due to slightly lower Adjusted EBITDA less cash taxes Consolidated Return on Invested Capital (as of June 30, 2025, dollars in millions) | (dollars in millions) | Q2 2025 LQA | Q2 2024 LQA | | :------------------------------------------ | :---------- | :---------- | | Adjusted EBITDA | $2,820 | $2,908 | | Cash taxes (paid) refunded | $(38) | $(23) | | Adjusted EBITDA less cash taxes paid | $2,782 | $2,885 | | Historical gross investment in property and equipment | $16,907 | $16,854 | | Historical gross investment in site rental contracts and tenant relationships | $4,590 | $4,589 | | Historical gross investment in goodwill | $5,127 | $5,127 | | Consolidated Invested Capital | $26,624 | $26,570 | | Consolidated Return on Invested Capital | 10.4 % | 10.9 % | - Amounts are exclusive of the Fiber Business, which is presented in discontinued operations[71] Cash Yield on Invested Capital Cash Yield on Invested Capital was 12.4% in Q2 2025 (LQA), a slight decrease from 12.6% in Q2 2024 (LQA), reflecting cash generated from net invested capital Cash Yield on Invested Capital (as of June 30, 2025, dollars in millions) | (dollars in millions) | Q2 2025 LQA | Q2 2024 LQA | | :------------------------------------------ | :---------- | :---------- | | Adjusted Site Rental Gross Margin | $3,048 | $3,276 | | Less: Amortization of prepaid rent | $(92) | $(156) | | Less: Straight-lined revenues | $(80) | $(216) | | Add: Straight-lined expenses | $44 | $48 | | Numerator | $2,920 | $2,952 | | Net investment in property and equipment | $13,590 | $13,501 | | Investment in site rental contracts and tenant relationships | $4,590 | $4,589 | | Investment in goodwill | $5,351 | $5,351 | | Net Invested Capital | $23,531 | $23,441 | | Cash Yield on Invested Capital | 12.4 % | 12.6 % | - Amounts are exclusive of the Fiber Business, which is presented in discontinued operations[71] Tenant Overview As of June 30, 2025, T-Mobile, AT&T, and Verizon collectively account for 88% of Q2 2025 LQA Site Rental Revenues, with a 6-year weighted average contract term Tenant Overview (as of June 30, 2025) | (as of June 30, 2025) | Percentage of Q2 2025 LQA Site Rental Revenues | Weighted Average Current Term Remaining | Long-Term Credit Rating (S&P / Moody's) | | :-------------------- | :--------------------------------------------- | :------------------------------------ | :------------------------------------ | | T-Mobile | 40% | 7 | BBB / Baa2 | | AT&T | 27% | 4 | BBB / Baa2 | | Verizon | 21% | 6 | BBB+ / Baa1 | | All Others Combined | 12% | 7 | N/A | | Total / Weighted Average | 100% | 6 | | - The tenant overview excludes the Fiber Business, which is presented in discontinued operations[78] Annualized Rental Cash Payments at Time of Renewal Projected annualized rental cash payments at renewal show a peak of $859 million in 2028, primarily from AT&T, with $40 million for remaining 2025 Annualized Rental Cash Payments at Time of Renewal (as of June 30, 2025, in millions) | (in millions) | Remaining Six Months 2025 | 2026 | 2027 | 2028 | 2029 | | :-------------- | :------------------------ | :--- | :--- | :--- | :--- | | T-Mobile | $3 | $27 | $32 | $26 | $24 | | AT&T | $6 | $23 | $13 | $774 | $240 | | Verizon | $3 | $6 | $7 | $31 | $48 | | All Others Combined | $28 | $42 | $37 | $28 | $45 | | Total | $40 | $98 | $89 | $859 | $357 | - The figures reflect lease renewals by year by tenant and represent annualized cash site rental revenues from assumed renewals or extensions[79] Projected Revenues from Tenant Contracts Associated with Active Licenses Projected site rental revenues from active tenant licenses are $2,015 million for remaining 2025, growing to $4,013 million in 2026, assuming renewals and 3% CPI escalation Projected Revenues from Tenant Contracts Associated with Active Licenses (as of June 30, 2025, in millions) | (in millions) | Remaining Six Months 2025 | 2026 | 2027 | 2028 | 2029 | | :-------------------------- | :------------------------ | :--- | :--- | :--- | :--- | | Site rental billings | $1,970 | $3,995 | $4,104 | $4,223 | $4,348 | | Amortization of prepaid rent | $44 | $77 | $65 | $43 | $28 | | Straight-lined revenues | $1 | $(59) | $(172) | $(235) | $(206) | | Site rental revenues | $2,015 | $4,013 | $3,997 | $4,031 | $4,170 | - Projections are based on tenant licenses active as of June 30, 2025, assuming renewals and a 3% annual escalation for CPI-linked contracts[80] Projected Expenses from Existing Ground Leases Projected ground lease expenses are $369 million for remaining 2025, increasing to $744 million in 2026, assuming 3% annual escalation for CPI-linked contracts Projected Expenses from Existing Ground Leases (as of June 30, 2025, in millions) | (in millions) | Remaining Six Months 2025 | 2026 | 2027 | 2028 | 2029 | | :---------------------------------------- | :------------------------ | :--- | :--- | :--- | :--- | | Ground lease expenses exclusive of straight-lined expenses | $343 | $701 | $721 | $741 | $761 | | Straight-lined expenses | $26 | $43 | $31 | $20 | $10 | | Ground lease expenses | $369 | $744 | $752 | $761 | $771 | - Projections are based on existing ground leases as of June 30, 2025, and assume CPI-linked contracts escalate at 3% per annum[85] Summary of Tower Portfolio by Vintage Towers acquired prior to 2006 show a 20% cash yield and 2.8 tenants per tower, outperforming newer towers (2007-present) with 10% cash yield and 2.2 tenants Summary of Tower Portfolio by Vintage (as of June 30, 2025, dollars in thousands) | (dollars in thousands) | Acquired and Built 2006 and Prior | Acquired and Built 2007 to Present | | :---------------------------------------------------- | :-------------------------------- | :--------------------------------- | | Cash yield | 20 % | 10 % | | Number of tenants per tower | 2.8 | 2.2 | | Last quarter annualized average cash site rental revenue per tower | $135 | $81 | | Last quarter annualized average site rental gross cash margin per tower | $116 | $57 | | Net invested capital per tower | $566 | $592 | | Number of towers | 11,172 | 28,725 | - Cash yield is calculated as last quarter annualized site rental gross margin divided by net invested capital[86] Ground Interest Overview As of June 30, 2025, 70% of towers are on leased ground, contributing 65% of LQA Cash Site Rental Revenues, with a 36-year weighted average lease term Ground Interest Overview (as of June 30, 2025, dollars in millions) | (dollars in millions) | LQA Cash Site Rental Revenues | Percentage of LQA Cash Site Rental Revenues | LQA Site Rental Gross Cash Margin | Percentage of LQA Site Rental Gross Cash Margin | Number of Towers | Percentage of Towers | Weighted Average Term Remaining (by years) | | :-------------------- | :---------------------------- | :------------------------------------------ | :-------------------------------- | :---------------------------------------------- | :--------------- | :------------------- | :--------------------------------------- | | Less than 10 years | $417 | 11 % | $225 | 7 % | 5,333 | 14 % | | | 10 to 20 years | $559 | 14 % | $349 | 12 % | 6,067 | 15 % | | | Greater than 20 years | $1,529 | 40 % | $1,099 | 38 % | 16,486 | 41 % | | | Total leased | $2,505 | 65 % | $1,673 | 57 % | 27,886 | 70 % | 36 | | Owned | $1,334 | 35 % | $1,256 | 43 % | 12,011 | 30 % | | | Total / Average | $3,839 | 100 % | $2,929 | 100 % | 39,897 | 100 % | | - The weighted average term remaining for leased ground interests is 36 years, including all renewal terms at the Company's option[88] Capitalization Overview Capitalization Overview As of June 30, 2025, Crown Castle reported $260 million in cash, $1,042 million secured debt, $23,392 million unsecured debt, and $24,174 million Net Debt Capitalization Overview (as of June 30, 2025, dollars in millions) | (dollars in millions) | Face Value | Fixed vs. Variable | Interest Rate | Maturity | | :------------------------------------------------------- | :--------- | :----------------- | :------------ | :------- | | Cash and cash equivalents and restricted cash and cash equivalents | $260 | | | | | Total secured debt | $1,042 | | 4.4% | | | 2016 Revolver | $400 | Variable | 5.5% | 2027 | | 2016 Term Loan A | $1,087 | Variable | 5.5% | 2027 | | Commercial Paper Notes | $1,905 | Variable | 5.1% | Various | | Total unsecured debt | $23,392 | | 3.9% | | | Net Debt | $24,174 | | 3.9% | | | Market Capitalization | $44,736 | | | | | Firm Value | $68,910 | | | | - Cash and cash equivalents exclude $14 million associated with discontinued operations relating to the Fiber Business[93] - The 1.350% Senior Notes ($500 million) were repaid in full in July 2025[96] Debt Maturity Overview This section visually presents Crown Castle's debt maturity schedule as of June 30, 2025, detailing principal payments across years, excluding Commercial Paper Notes - The debt maturity overview visually presents the company's debt obligations by year, excluding $1.9 billion in outstanding Commercial Paper Notes[99][101] - The 1.350% Senior Notes, which matured in July 2025, were repaid in full[101] Liquidity Overview As of June 30, 2025, Crown Castle had $260 million in cash and $6,560 million in undrawn revolver availability, alongside a $750 million stock offering and $2.0 billion commercial paper program Liquidity Overview (June 30, 2025, in millions) | (in millions) | June 30, 2025 | | :------------------------------------------------------- | :------------ | | Cash and cash equivalents, and restricted cash and cash equivalents | $260 | | Undrawn 2016 Revolver availability | $6,560 | | Total debt and other obligations (current and non-current) | $24,290 | | Total equity (deficit) | $(1,382) | - The company has an at-the-market stock offering program for up to $750 million, with no shares sold to date[104] - As of June 30, 2025, $1.9 billion in Commercial Paper Notes were outstanding under a $2.0 billion program, with available commitments under the 2016 Revolver intended to cover outstanding CP Notes[104] Summary of Maintenance and Financial Covenants As of June 30, 2025, Crown Castle is compliant with covenants, with Total Net Leverage Ratio at 5.8x (covenant ≤ 6.50x) and Total Senior Secured Leverage Ratio at 0.2x (covenant ≤ 3.50x) Summary of Maintenance and Financial Covenants (as of June 30, 2025) | Debt Borrower / Issuer | Covenant | Covenant Level Requirement | As of June 30, 2025 | | :------------------------------------------------------- | :------------------------------------------------------- | :------------------------- | :------------------ | | Maintenance Financial Covenants | | | | | 2016 Credit Facility CCI | Total Net Leverage Ratio | ≤ 6.50x | 5.8x | | 2016 Credit Facility CCI | Total Senior Secured Leverage Ratio | ≤ 3.50x | 0.2x | | Tower Revenue Notes, Series 2018-2 Crown Castle Towers LLC and its Subsidiaries | Debt Service Coverage Ratio | > 1.75x | 30.6x | | 2009 Securitized Notes Pinnacle Towers Acquisition Holdings LLC and its Subsidiaries | Debt Service Coverage Ratio | > 1.30x | 37.1x | | Financial covenants restricting ability of relevant issuer to issue additional notes under the applicable indenture | | | | | Tower Revenue Notes, Series 2018-2 Crown Castle Towers LLC and its Subsidiaries | Debt Service Coverage Ratio | ≥ 2.00x | 30.6x | | 2009 Securitized Notes Pinnacle Towers Acquisition Holdings LLC and its Subsidiaries | Debt Service Coverage Ratio | ≥ 2.34x | 37.1x | - Failure to comply with financial maintenance covenants would result in an event of default under the 2016 Credit Facility[106] Interest Rate Exposure As of June 30, 2025, 86% of total debt is fixed-rate (3.7% W.A. interest rate), 14% floating-rate (5.3% W.A. interest rate), with a 25 bps increase costing $8.5 million annually Interest Rate Exposure (as of June 30, 2025) | Fixed Rate Debt | | Floating Rate Debt | | | :------------------------------------------------------- | :-------- | :------------------------------------------------------- | :-------- | | Face value of principal outstanding | $20,779 | Face value of principal outstanding | $3,392 | | % of total debt | 86% | % of total debt | 14% | | Weighted average interest rate | 3.7% | Weighted average interest rate | 5.3% | | Upcoming maturities: | 2025 | 2026 | Interest rate sensitivity of 25 bps increase in interest rates: | | | Face value of principal outstanding | $500 | $2,650 | Full year effect | $8.5 | | Weighted average interest rate | 1.4% | 3.0% | | | - The weighted average interest rate for floating-rate debt reflects a reduced spread due to the company meeting specified annual sustainability targets as of December 31, 2024[116] Components of Interest Expense Q2 2025 net interest expense and amortization of deferred financing costs was $243 million, an increase from $230 million in Q2 2024, with a quarterly breakdown provided Components of Interest Expense (Q1 2024 - Q2 2025, in millions) | (in millions) | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | | :------------------------------------------------------- | :------ | :------ | :------ | :------ | :------ | :------ | | Interest expense and amortization of deferred financing costs, net | $226 | $230 | $236 | $240 | $236 | $243 | | Interest expense on debt obligations | $223 | $227 | $234 | $236 | $233 | $239 | | Amortization of deferred financing costs and adjustments on long-term debt | $8 | $8 | $8 | $8 | $8 | $8 | | Capitalized interest | $(5) | $(5) | $(6) | $(4) | $(5) | $(4) | Appendix of Condensed Consolidated Financial Statements and Non-GAAP Reconciliations Condensed Consolidated Balance Sheet (Unaudited) As of June 30, 2025, total assets were $31,636 million, total liabilities $33,018 million, and total equity deficit widened to $(1,382) million from year-end 2024 Condensed Consolidated Balance Sheet (Unaudited, in millions) | (in millions) | June 30, 2025 | December 31, 2024 | | :------------------------------------------------------- | :------------ | :---------------- | | ASSETS | | | | Total current assets | $1,074 | $1,090 | | Deferred site rental receivables | $2,277 | $2,279 | | Property and equipment, net | $6,402 | $6,577 | | Operating lease right-of-use assets | $5,562 | $5,600 | | Goodwill | $5,127 | $5,127 | | Other intangible assets, net | $949 | $1,037 | | Other assets, net | $63 | $58 | | Non-current assets of discontinued operations | $10,182 | $10,968 | | Total assets | $31,636 | $32,736 | | LIABILITIES AND EQUITY (DEFICIT) | | | | Total current liabilities | $3,803 | $2,177 | | Debt and other long-term obligations | $22,039 | $23,451 | | Operating lease liabilities | $5,009 | $5,062 | | Other long-term liabilities | $628 | $645 | | Non-current liabilities of discontinued operations | $1,539 | $1,534 | | Total liabilities | $33,018 | $32,869 | | Total equity (deficit) | $(1,382) | $(133) | | Total liabilities and equity (deficit) | $31,636 | $32,736 | - Current maturities of debt and other obligations significantly increased from $603 million at December 31, 2024, to $2,251 million at June 30, 2025[122] - The total equity deficit widened substantially from $(133) million to $(1,382) million, primarily due to an increase in dividends/distributions in excess of earnings[122] Condensed Consolidated Statement of Operations (Unaudited) Q2 2025 net revenues were $1,060 million, with net income of $291 million, despite a $(252) million loss from discontinued operations disposal, leading to a year-to-date net loss of $(173) million Condensed Consolidated Statement of Operations (Unaudited, in millions, except per share amounts) | (in millions, except per share amounts) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net revenues | $1,060 | $1,107 | $2,121 | $2,221 | | Total operating expenses | $554 | $612 | $1,094 | $1,207 | | Operating income (loss) | $506 | $495 | $1,027 | $1,014 | | Interest expense and amortization of deferred financing costs, net | $(243) | $(230) | $(479) | $(455) | | Income (loss) from continuing operations | $265 | $265 | $549 | $559 | | Income (loss) from discontinued operations before gain (loss) from disposal, net of tax | $278 | $(14) | $360 | $3 | | Gain (loss) from disposal of discontinued operations | $(252) | — | $(1,082) | — | | Income (loss) from discontinued operations, net of tax | $26 | $(14) | $(722) | $3 | | Net income (loss) | $291 | $251 | $(173) | $562 | | Net income (loss)—diluted | $0.67 | $0.58 | $(0.40) | $1.29 | - Income from discontinued operations before gain/loss from disposal was $278 million in Q2 2025, a significant improvement from a loss of $(14) million in Q2 2024[127] - A substantial loss from disposal of discontinued operations of $(1,082) million was recorded for the six months ended June 30, 2025[127] Condensed Consolidated Statement of Cash Flows (Unaudited) For the six months ended June 30, 2025, net cash from operations increased to $1,473 million, investing activities used $(523) million, and financing activities used $(971) million, driven by debt and dividends Condensed Consolidated Statement of Cash Flows (Unaudited, in millions) | (in millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------------------- | :------------------------------- | :------------------------------- | | Net income (loss) | $(173) | $562 | | Income (loss) from continuing operations | $549 | $559 | | Net cash provided by (used for) operating activities from discontinued operations | $581 | $556 | | Net cash provided by (used for) operating activities | $1,473 | $1,367 | | Net cash provided by (used for) investing activities from discontinued operations | $(446) | $(563) | | Net cash provided by (used for) investing activities | $(523) | $(650) | | Principal payments on debt and other long-term obligations | $(59) | $(36) | | Purchases and redemptions of long-term debt | $(700) | — | | Borrowings under revolving credit facility | $400 | — | | Payments under revolving credit facility | — | $(670) | | Net issuances (repayments) under commercial paper program | $564 | $1,438 | | Purchases of common stock | $(23) | $(30) | | Dividends/distributions paid on common stock | $(1,153) | $(1,368) | | Net cash provided by (used for) financing activities | $(971) | $(666) | | Net increase (decrease) in cash and cash equivalents and restricted cash and cash equivalents | $(21) | $51 | | Cash and cash equivalents and restricted cash and cash equivalents at end of period | $274 | $331 | - Cash flows from operating activities from discontinued operations provided $581 million in 2025, up from $556 million in 2024[132] - Purchases and redemptions of long-term debt amounted to $(700) million in the first six months of 2025, compared to none in the prior year[132] Non-GAAP Measures and Other Information This section defines and explains Crown Castle's non-GAAP financial measures, including Adjusted EBITDA, AFFO, FFO, and other key operational terms - Non-GAAP measures are presented as additional information to evaluate financial performance, as they are useful indicators for management and investors[138] - Adjusted EBITDA helps evaluate economic productivity by removing the impact of capital structure and asset base[138] - AFFO is used to evaluate financial performance by including capital structure and sustaining capital expenditures, while excluding asset base and certain non-cash items[138] Non-GAAP Financial Measures This subsection defines key non-GAAP financial measures such as Adjusted EBITDA, AFFO, and FFO, used for evaluating financial performance - Adjusted EBITDA is defined as net income (loss) plus various adjustments including restructuring charges, asset write-down charges, depreciation, amortization, interest expense, and excluding income from discontinued operations[140] - AFFO is defined as FFO before straight-lined revenues and expenses, stock-based compensation, non-cash tax provision, non-real estate related depreciation, amortization of non-cash interest expense, and other adjustments, less sustaining capital expenditures[141] - FFO is defined as net income (loss) plus real estate related depreciation, amortization, asset write-down charges, goodwill impairment charges, and income/loss from discontinued operations, less noncontrolling interest and preferred stock dividends[143] Other Information This subsection defines operational terms including site rental billings, discretionary capital expenditures, and Sprint Cancellations - Site rental billings are defined as site rental revenues exclusive of straight-lined revenues, amortization of prepaid rent, contribution from recent acquisitions, and other revenues[155] - Discretionary capital expenditures are those made to enhance long-term stockholder value, primarily for expansion or development of communications infrastructure, purchases of land interests, and technology investments[159] - Sprint Cancellations refer to lease cancellations related to the T-Mobile US, Inc. and Sprint network consolidation[161] Reconciliation of Historical Adjusted EBITDA Historical Adjusted EBITDA for Q2 2025 was $705 million, down from $727 million in Q2 2024, adjusted from net income for non-cash and discontinued operations items Reconciliation of Historical Adjusted EBITDA (Q1 2024 - Q2 2025, in millions) | (in millions) | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | | :------------------------------------------------------- | :------ | :------ | :------ | :------ | :------ | :------ | | Net income (loss) | $311 | $251 | $303 | $(4,768) | $(464) | $291 | | Asset write-down charges | $6 | $3 | $2 | $1 | $2 | $2 | | Depreciation, amortization and accretion | $191 | $180 | $181 | $183 | $177 | $175 | | Restructuring charges | $11 | $19 | $38 | $3 | — | — | | Amortization of prepaid lease purchase price adjustments | $4 | $4 | $4 | $4 | $4 | $4 | | Interest expense and amortization of deferred financing costs, net | $226 | $230 | $236 | $240 | $236 | $243 | | Interest income | $(4) | $(4) | $(6) | $(5) | $(3) | $(4) | | Other (income) expense | $(2) | $(1) | $5 | $23 | $(1) | $(2) | | (Benefit) provision for income taxes | $6 | $5 | $3 | $4 | $5 | $4 | | Stock-based compensation expense, net | $24 | $26 | $19 | $15 | $18 | $18 | | (Income) loss from discontinued operations, net of tax | $(17) | $14 | $(9) | $5,077 | $748 | $(26) | | Adjusted EBITDA | $754 | $727 | $777 | $777 | $722 | $705 | - Net income (loss) includes contributions from discontinued operations[167] - The Q4 2024 net income (loss) of $(4,768) million and corresponding large positive adjustment for discontinued operations reflects the impact of the Fiber Business reclassification[166][169] Reconciliation of Outlook for Adjusted EBITDA The Full Year 2025 Outlook projects Adjusted EBITDA between $2,780 million and $2,830 million, including estimated net income and significant adjustments for discontinued operations Reconciliation of Outlook for Adjusted EBITDA (Full Year 2025, in millions) | (in millions) | Full Year 2025 Outlook | | :------------------------------------------------------- | :--------------------- | | Net income (loss) | $100 to $380 | | Asset write-down charges | $5 to $15 | | Acquisition and integration costs | $0 to $6 | | Depreciation, amortization and accretion | $678 to $773 | | Amortization of prepaid lease purchase price adjustments | $14 to $16 | | Interest expense and amortization of deferred financing costs, net | $972 to $1,017 | | (Gains) losses on retirement of long-term obligations | — to — | | Interest income | $(15) to $(15) | | Other (income) expense | $6 to $15 | | (Benefit) provision for income taxes | $11 to $19 | | Stock-based compensation expense, net | $78 to $82 | | (Income) loss from discontinued operations, net of tax | $590 to $830 | | Adjusted EBITDA | $2,780 to $2,830 | - The outlook for net income (loss) includes contributions from discontinued operations[167] - The expected income (loss) from discontinued operations includes an estimated loss on disposal of the Fiber Business[170] Reconciliation of Historical FFO and AFFO Historical FFO for Q2 2025 was $429 million (down from $436 million in Q2 2024) and AFFO was $444 million (down from $449 million), adjusted for real estate depreciation and discontinued operations Reconciliation of Historical FFO and AFFO (Q1 2024 - Q2 2025, in millions) | (in millions) | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | | :------------------------------------------------------- | :------ | :------ | :------ | :------ | :------ | :------ | | Net income (loss) | $311 | $251 | $303 | $(4,768) | $(464) | $291 | | Real estate related depreciation, amortization and accretion | $179 | $168 | $170 | $173 | $164 | $162 | | Asset write-down charges | $6 | $3 | $2 | $1 | $2 | $2 | | (Income) loss from discontinued operations, net of tax | $(17) | $14 | $(9) | $5,077 | $748 | $(26) | | FFO | $478 | $436 | $466 | $483 | $451 | $429 | | Straight-lined revenues | $(57) | $(54) | $(28) | $(20) | $(19) | $(20) | | Straight-lined expenses | $17 | $17 | $16 | $15 | $15 | $14 | | Stock-based compensation expense, net | $24 | $26 | $19 | $15 | $18 | $18 | | Non-cash portion of tax provision | $6 | — | — | $2 | $5 | $(5) | | Non-real estate related depreciation, amortization and accretion | $12 | $12 | $11 | $11 | $13 | $13 | | Amortization of non-cash interest expense | $3 | $3 | $2 | $3 | $3 | $4 | | Other (income) expense | $(2) | $(1) | $5 | $23 | $(1) | $(2) | | Restructuring charges | $11 | $19 | $38 | $3 | — | — | | Sustaining capital expenditures | $(8) | $(9) | $(6) | $(12) | $(7) | $(7) | | AFFO | $484 | $449 | $525 | $523 | $479 | $444 | - The significant (Income) loss from discontinued operations, net of tax, in Q4 2024 and Q1 2025 reflects the reclassification and loss on disposal of the Fiber Business[175] Reconciliation of Historical FFO and AFFO per share Historical FFO per share for Q2 2025 was $0.98 (down from $1.00 in Q2 2024) and AFFO per share was $1.02 (down from $1.03), reflecting per-share adjustments Reconciliation of Historical FFO and AFFO per share (Q1 2024 - Q2 2025, in millions, except per share amounts) | (in millions, except per share amounts) | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | | :-------------------------------------- | :------ | :------ | :------ | :------ | :------ | :------ | | Net income (loss) | $0.72 | $0.58 | $0.70 | $(10.97) | $(1.06) | $0.67 | | Real estate related depreciation, amortization and accretion | $0.41 | $0.39 | $0.39 | $0.40 | $0.38 | $0.37 | | Asset write-down charges | $0.01 | $0.01 | — | — | — | — | | (Income) loss from discontinued operations, net of tax | $(0.04) | $0.04 | $(0.02) | $11.67 | $1.72 | $(0.06) | | FFO | $1.10 | $1.00 | $1.07 | $1.11 | $1.03 | $0.98 | | Straight-lined revenues | $(0.13) | $(0.12) | $(0.06) | $(0.05) | $(0.04) | $(0.05) | | Straight-lined expenses | $0.04 | $0.04 | $0.04 | $0.03 | $0.03 | $0.03 | | Stock-based compensation expense, net | $0.06 | $0.06 | $0.04 | $0.03 | $0.04 | $0.04 | | Non-cash portion of tax provision | $0.01 | — | — | — | $0.01 | $(0.01) | | Non-real estate related depreciation, amortization and accretion | $0.03 | $0.03 | $0.03 | $0.03 | $0.03 | $0.03 | | Amortization of non-cash interest expense | $0.01 | $0.01 | — | $0.01 | $0.01 | $0.01 | | Other (income) expense | — | — | $0.01 | $0.05 | — | — | | Restructuring charges | $0.03 | $0.04 | $0.09 | $0.01 | — | — | | Sustaining capital expenditures | $(0.02) | $(0.02) | $(0.01) | $(0.03) | $(0.02) | $(0.02) | | AFFO | $1.11 | $1.03 | $1.20 | $1.20 | $1.10 | $1.02 | - The per-share impact of (Income) loss from discontinued operations was $1.72 in Q1 2025 and $(0.06) in Q2 2025[180] Reconciliation of Outlook for FFO and AFFO Full Year 2025 Outlook projects FFO between $1,645 million and $1,675 million ($3.77 to $3.84 per share), and AFFO between $1,805 million and $1,855 million ($4.14 to $4.25 per share) Reconciliation of Outlook for FFO and AFFO (Full Year 2025, in millions, except per share amounts) | (in millions, except per share amounts) | Full Year 2025 Outlook | Per Share | | :-------------------------------------- | :--------------------- | :-------- | | Net income (loss) | $100 to $380 | $0.23 to $0.87 | | Real estate related depreciation, amortization and accretion | $660 to $740 | $1.51 to $1.70 | | Asset write-down charges | $5 to $15 | $0.01 to $0.03 | | (Income) loss from discontinued operations, net of tax | $590 to $830 | $1.35 to $1.90 | | FFO | $1,645 to $1,675 | $3.77 to $3.84 | | Straight-lined revenues | $(15) to $15 | $(0.03) to $0.03 | | Straight-lined expenses | $55 to $75 | $0.13 to $0.17 | | Stock-based compensation expense, net | $78 to $82 | $0.18 to $0.19 | | Non-cash portion of tax provision | $(8) to $8 | $(0.02) to $0.02 | | Non-real estate related depreciation, amortization and accretion | $20 to $35 | $0.04 to $0.08 | | Amortization of non-cash interest expense | $7 to $17 | $0.02 to $0.04 | | Other (income) expense | $6 to $15 | $0.01 to $0.03 | | (Gains) losses on retirement of long-term obligations | — to — | — to — | | Acquisition and integration costs | $0 to $6 | $0.00 to $0.01 | | Sustaining capital expenditures | $(55) to $(35) | $(0.13) to $(0.08) | | AFFO | $1,805 to $1,855 | $4.14 to $4.25 | - The outlook for (Income) loss from discontinued operations, net of tax, includes the estimated loss on disposal of the Fiber Business[186] Reconciliation of Net Debt As of June 30, 2025, Crown Castle's Net Debt was $24,174 million, calculated from total debt and other obligations, adjusted for unamortized items and cash Reconciliation of Net Debt (as of June 30, 2025, dollars in millions) | (dollars in millions) | June 30, 2025 | | :------------------------------------------------------- | :------------ | | Total debt and other obligations (current and non-current) | $24,290 | | Unamortized adjustments, net | $144 | | Total face value of debt | $24,434 | | Less: Ending cash and cash equivalents and restricted cash and cash equivalents | $260 | | Net Debt | $24,174 | - Total debt and other obligations exclude $32 million presented in discontinued operations relating to the Fiber Business[186] - Cash and cash equivalents and restricted cash exclude $14 million presented in discontinued operations relating to the Fiber Business[187] Reconciliation of Adjusted Site Rental Gross Margin and Adjusted Services and Other Gross Margin Q2 2025 Adjusted Site Rental Gross Margin was $762 million (down from $819 million in Q2 2024), while Adjusted Services and Other Gross Margin was $26 million (up from $20 million) Reconciliation of Adjusted Site Rental Gross Margin (Q2 2025 vs. Q2 2024, In millions of dollars) | (In millions of dollars) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :------------------------------------------------------- | :------------------------------- | :------------------------------- | | Net income (loss) | $291 | $251 | | Adjustments to increase (decrease) income (loss): | | | | Services and other revenues | $(52) | $(43) | | Services and other costs of operations | $27 | $25 | | Selling, general and administrative expenses | $99 | $136 | | Asset write-down charges | $2 | $3 | | Depreciation, amortization and accretion | $175 | $180 | | Restructuring charges | — | $19 | | Amortization of prepaid lease purchase price adjustments | $4 | $4 | | Interest expense and amortization of deferred financing costs, net | $243 | $230 | | Interest income | $(4) | $(4) | | Other (income) expense | $(2) | $(1) | | (Benefit) provision for income taxes | $4 | $5 | | Stock-based compensation expense, net recorded in site rental costs of operations | $1 | $1 | | (Income) loss from discontinued operations, net of tax | $(26) | $14 | | Adjusted Site Rental Gross Margin | $762 | $819 | Reconciliation of Adjusted Services and Other Gross Margin (Q2 2025 vs. Q2 2024, In millions of dollars) | (In millions of dollars) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :------------------------------------------------------- | :------------------------------- | :------------------------------- | | Net income (loss) | $291 | $251 | | Adjustments to increase (decrease) net income (loss): | | | | Site rental revenues | $(1,008) | $(1,064) | | Site rental costs of operations | $251 | $249 | | Selling, general and administrative expenses | $99 | $136 | | Asset write-down charges | $2 | $3 | | Depreciation, amortization and accretion | $175 | $180 | | Restructuring charges | — | $19 | | Interest expense and amortization of deferred financing costs, net | $243 | $230 | | Interest income | $(4) | $(4) | | Other (income) expense | $(2) | $(1) | | (Benefit) provision for income taxes | $4 | $5 | | Stock-based compensation expense, net recorded in services and other costs of operations | $1 | $2 | | (Income) loss from discontinued operations, net of tax | $(26) | $14 | | Adjusted Services and Other Gross Margin | $26 | $20 | - Net income (loss) includes contributions from discontinued operations for both reconciliations[190] Reconciliation of Historical Free Cash Flow from Discontinued Operations For the six months ended June 30, 2025, Free Cash Flow from Discontinued Operations was $135 million, a significant improvement from $(7) million in the prior year Reconciliation of Historical Free Cash Flow from Discontinued Operations (Six Months Ended June 30, in millions of dollars) | (in millions of dollars) | 2025 | 2024 | | :------------------------------------------------------- | :--- | :--- | | Net cash provided by (used for) operating activities from discontinued operations | $581 | $556 | | Net cash provided by (used for) investing activities from discontinued operations | $(446) | $(563) | | Free Cash Flow from Discontinued Operations | $135 | $(7) | - Free Cash Flow from Discontinued Operations is defined as net cash provided by (used for) operating activities from discontinued operations plus net cash provided by (used for) investing activities from discontinued operations[194] Reconciliation of Outlook for Free Cash Flow from Discontinued Operations Full Year 2025 Outlook projects Free Cash Flow from Discontinued Operations between $150 million and $350 million, driven by operating activities offset by investing activities Reconciliation of Outlook for Free Cash Flow from Discontinued Operations (Full Year 2025, in millions of dollars) | (in millions of dollars) | Full Year 2025 Outlook | | :------------------------------------------------------- | :--------------------- | | Net cash provided by (used for) operating activities from discontinued operations | $1,220 to $1,320 | | Net cash provided by (used for) investing activities from discontinued operations | $(1,070) to $(970) | | Free Cash Flow from Discontinued Operations | $150 to $350 | - The outlook for Free Cash Flow from Discontinued Operations is based on expected results from the Fiber Business[194]