Altice USA, Inc. (ATUS) Up 20.2% Since Last Earnings Report: Can It Continue?

Core Viewpoint - Altice USA, Inc. reported mixed fourth-quarter 2023 results, with revenue exceeding estimates but net income falling short, indicating challenges in certain segments while showing growth in others [2][3]. Financial Performance - The company reported a net loss of $117.8 million or 26 cents per share, an improvement from a loss of $193.1 million or 43 cents per share in the prior-year quarter, aided by tax benefits and lower operating expenses [3]. - Total revenues for the quarter were $2.3 billion, down from $2.36 billion year-over-year, but exceeded the consensus estimate by $13 million [4]. - For the full year 2023, net sales totaled $9.23 billion, a decrease from $9.64 billion in 2022 [4]. Segment Performance - Residential revenues, which include Broadband, Video, and Telephony, were $1.79 billion, down from $1.83 billion year-over-year, primarily due to the loss of higher ARPU video customers [6]. - Business services and wholesale revenues increased to $372 million from $368.4 million in the year-ago quarter, driven by growth in Lightpath revenues [5]. - News and Advertising revenues fell to $128.1 million from $151.8 million year-over-year, attributed to lower political advertising revenues [5]. Customer Metrics - FTTH broadband net additions exceeded 46,000 in the quarter, with total fiber broadband customers reaching 341,000 [5]. - The company had 2.73 million FTTH passings at the end of the quarter, with 14,900 added in the September-December period [4]. - Optimum Mobile subscriber growth reached 322,000 customers, representing a 7.1% penetration of the total broadband customer base [7]. Cash Flow and Debt - In 2023, Altice generated $1.82 billion in cash from operating activities, down from $2.36 billion in 2022 [9]. - As of December 31, 2023, the company's net debt stood at $24.82 billion [9]. Market Outlook - Estimates for Altice have trended downward, with a consensus estimate shift of -108.7% noted [9]. - The company holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [11]. Industry Comparison - Altice USA, Inc. operates within the Zacks Communication - Components industry, where competitor Arista Networks reported a revenue increase of 20.8% year-over-year, highlighting contrasting performance within the sector [12].