Altice USA(ATUS) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION Item 1. Financial Statements The company's unaudited financial statements show a net loss of $88.0 million for Q2 2025, driven by declining revenues Consolidated Financial Statements (Altice USA, Inc.) The company reported a Q2 2025 net loss of $88.0 million and a significant decline in operating cash flow Altice USA, Inc. Consolidated Balance Sheet Summary (in thousands) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $739,268 | $730,992 | | Total Assets | $31,619,129 | $31,701,370 | | Total Current Liabilities | $2,241,810 | $2,254,796 | | Long-term Debt | $25,214,989 | $24,872,015 | | Total Liabilities | $32,244,623 | $32,158,202 | | Total Stockholders' Deficiency | $(625,494) | $(456,832) | Altice USA, Inc. Consolidated Statement of Operations Summary (in thousands, except per share) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $2,147,203 | $2,240,755 | $4,299,485 | $4,491,690 | | Operating Income | $311,123 | $501,582 | $654,581 | $894,736 | | Net Income (Loss) | $(87,986) | $21,702 | $(159,257) | $8,806 | | Basic EPS | $(0.21) | $0.03 | $(0.37) | $(0.01) | Altice USA, Inc. Consolidated Cash Flow Summary - Six Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $599,448 | $706,455 | | Net Cash used in Investing Activities | $(745,555) | $(685,893) | | Capital Expenditures | $(739,643) | $(683,816) | | Net Cash from Financing Activities | $135,982 | $40,311 | Supplemental Financial Statements (CSC Holdings, LLC) Key subsidiary CSC Holdings, LLC reported a Q2 2025 net loss of $93.0 million and a total member's deficiency of $635.8 million - CSC Holdings' balance sheet shows total assets of $31.62 billion and total liabilities of $32.26 billion, leading to a total deficiency of $635.8 million[20] CSC Holdings, LLC Statement of Operations Summary (in thousands) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $2,147,203 | $2,240,755 | $4,299,485 | $4,491,690 | | Operating Income | $306,381 | $501,582 | $648,320 | $894,736 | | Net Income (Loss) | $(93,018) | $21,702 | $(166,735) | $8,806 | Combined Notes to Consolidated Financial Statements Notes detail revenue composition, $25.3 billion in debt, legal contingencies, and subsequent financing events Revenue Composition - Six Months Ended June 30 (in thousands) | Revenue Source | 2025 | 2024 | | :--- | :--- | :--- | | Residential Broadband | $1,784,700 | $1,831,983 | | Residential Video | $1,326,108 | $1,495,039 | | Residential Telephony | $131,045 | $142,668 | | Residential Mobile | $74,320 | $52,372 | | Business services and wholesale | $725,333 | $734,151 | | News and advertising | $221,181 | $211,005 | | Total Revenue | $4,299,485 | $4,491,690 | - As of June 30, 2025, the company had total principal debt of $25.32 billion, primarily consisting of various Senior Notes and Credit Facilities[58] - The company is defending against a copyright infringement lawsuit from Warner Records, currently stayed pending a Supreme Court decision[102] - Subsequent to the quarter, the company secured a $1.0 billion receivables loan and sold tower assets for approximately $60 million[117][119] Management's Discussion and Analysis of Financial Condition and Results of Operations Revenue declined 4.2% YoY in Q2 2025 due to customer losses, leading to lower Adjusted EBITDA and negative Free Cash Flow Results of Operations Q2 2025 revenue fell 4.2% YoY to $2.15 billion, driven by residential customer losses, though FTTH customers showed growth Q2 Revenue Performance (in thousands) | Revenue Category | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Broadband | $885,139 | $914,989 | (3.3%) | | Video | $660,540 | $739,445 | (10.7%) | | Mobile | $37,621 | $27,479 | 36.9% | | Business services & wholesale | $361,788 | $369,290 | (2.0%) | | News and advertising | $118,771 | $105,280 | 12.8% | | Total Revenue | $2,147,203 | $2,240,755 | (4.2%) | - Adjusted EBITDA for Q2 2025 was $803.8 million, a 7.3% decrease from $867.2 million in Q2 2024, primarily due to the decline in revenue[141][167] - Total customer relationships declined to 4.46 million, though FTTH customers grew to 663,000 with passings reaching over 3.0 million[142] Liquidity and Capital Resources The company reported a Free Cash Flow deficit of $140.2 million for H1 2025 and subsequently secured a $1.0 billion loan - As of June 30, 2025, total debt outstanding was $25.29 billion, split between the CSC Holdings Restricted Group ($23.75B) and Lightpath ($1.53B)[189] Free Cash Flow (Deficit) - Six Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net cash flows from operating activities | $599,448 | $706,455 | | Less: Capital expenditures (cash) | $(739,643) | $(683,816) | | Free Cash Flow (Deficit) | $(140,195) | $22,639 | - In July 2025, a subsidiary entered into a Receivables Facility Loan providing $1.0 billion in term loan commitments[198][199] Quantitative and Qualitative Disclosures About Market Risk The company's primary market risk is interest rate exposure on its variable-rate debt, managed with interest rate swaps - The company's main market risk exposure is to interest rate fluctuations on its variable-rate debt[227] - The fair value of the company's fixed-rate debt was $13.03 billion, which is $4.68 billion lower than its carrying value of $17.71 billion[206] - The company uses interest rate swap contracts to manage interest rate risk, with a net fair value asset of $2.9 million[71][207] Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes - Management concluded that disclosure controls and procedures were effective as of the end of the period, June 30, 2025[227] - There were no material changes in internal control over financial reporting during the quarter[228] PART II. OTHER INFORMATION Legal Proceedings The company is involved in a significant copyright infringement lawsuit filed by Warner Records, which is currently stayed - The company is a defendant in a copyright infringement lawsuit filed by Warner Records Inc, which is currently stayed[102][230] Other Information No other material information was reported for the period - No information was reported under this item[231] Exhibits This section lists all exhibits filed with the Form 10-Q, including required CEO and CFO certifications - Lists exhibits filed with the report, including CEO and CFO certifications under the Sarbanes-Oxley Act[232]