SBA Communications (NasdaqGS:SBAC) Q3 2025 Earnings Call November 03, 2025 05:00 PM ET Company ParticipantsMarc Montagner - CFOBrendan Cavanagh - President and CEOMark DeRussy - Vice President of FinanceConference Call ParticipantsBrandon Nispel - Equity Research AnalystJim Schneider - Senior Equity Research AnalystDavid Barden - Senior Telecommunications Equity Research AnalystNick Del Deo - Research AnalystEric Luebchow - Senior AnalystMichael Rollins - AnalystAri Klein - AnalystBrendan Lynch - AnalystRic ...

Financial Data and Key Metrics Changes - The company reported a strong quarter with an increase in Adjusted Funds From Operations (AFFO) per share, leading the industry [4] - Revenue from the services business increased by 81% year-over-year in Q3, primarily driven by construction-related projects [4] - The company ended the quarter with total debt of $12.8 billion and net debt of $12.3 billion, maintaining a leverage ratio of 6.2 times net debt to adjusted EBITDA [19] Business Line Data and Key Metrics Changes - Domestic organic leasing revenue growth was 5.3% on a gross basis and 1.6% on a net basis, with churn at 3.7% [11] - International organic leasing revenue growth was 8.5% on a constant currency basis [12] - The company acquired 447 sites for approximately $143 million during Q3, primarily related to the Millicom acquisition [12] Market Data and Key Metrics Changes - The company noted that 80% of consolidated cash site leasing revenue and 85% of adjusted EBITDA were denominated in U.S. dollars [11] - Total international churn remained elevated due to ongoing carrier consolidation, particularly in Brazil [51] Company Strategy and Development Direction - The company is focusing on being a leading tower company in each market and aligning with leading wireless operators [6] - A new long-term agreement with Verizon was established to support network modernization, enhancing operational efficiencies for both companies [7] - The company is changing its financial policy to reduce the target leverage range to six to seven times net debt to adjusted EBITDA, aiming for investment-grade debt [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the macro environment for mobile broadband growth, driven by increasing 5G use cases and federal support for network capacity [9] - The company anticipates continued strong leasing demand and is increasing its full-year outlook for new leasing activity and escalations [4] - Management acknowledged challenges from regulatory delays but remains confident in future growth opportunities [64] Other Important Information - The company completed the acquisition of Central American assets from Millicom and sold its Canadian tower business earlier than expected [5] - A cash dividend of $1.11 per share was declared, representing a 13% increase over the previous year [20] Q&A Session Summary Question: Impact of Verizon MLA on new leasing revenue - Management indicated that the Verizon agreement includes components for colocations and amendments, locking in growth for the next 10 years [24] Question: Current status of DISH payments - Management confirmed that DISH is current on their rents and expects them to honor their agreements [25] Question: Structure of the Verizon deal compared to AT&T - The Verizon deal is more linear and tied directly to activity, differing from the AT&T agreement [34] Question: International churn outlook - Management expects a significant reduction in international churn over the next couple of years as consolidation stabilizes [51] Question: Future leasing opportunities and regulatory challenges - Management is optimistic about mid-single-digit growth in leasing opportunities, despite regulatory challenges in some markets [62]