Financial Data and Key Metrics Changes - The organic business of the company grew at 10.2% annually for 15 years before slowing to about 5% per year due to COVID-19, with margin expansion decreasing from an average of 220 basis points to about 100 basis points [4] - Following the acquisition of Sprint's global markets business, the combined growth rate declined to about -2% annually, down from a previous 5% growth rate [5] - The company anticipates returning to positive top-line growth in the current quarter, with expected margin growth of about 200 basis points year over year [8] Business Line Data and Key Metrics Changes - Approximately 70% of current revenues are growing at about 5%, while about one-third of revenues are declining at 1-2% [8] - The newly established wavelength business is growing rapidly, with a sequential revenue growth rate of 27% and a year-over-year growth rate of 149% [7] - The company has reduced noncore product revenues from nearly $60 million annually at acquisition to about $15 million today [22] Market Data and Key Metrics Changes - The company has seen a shift in traffic growth, with lower growth rates in developed markets compared to less developed markets, where traffic growth has increased from 45% to 55% over three years [30] - The effective price per megabit is higher in less developed markets, which is expected to positively impact revenue as the company plans to enter markets like India [31] Company Strategy and Development Direction - The primary strategy involves repurposing the original long-distance telephone network into a wavelength transport network, which is expected to drive future growth [6] - The company is focused on divesting noncore assets to improve leverage and is motivated to grow its recurring revenue business, particularly in wavelengths and core on-net services [56] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to revenue growth and achieving additional synergies from the acquisition, with integration costs expected to taper off over the next six quarters [6][12] - The company plans to return increasing amounts of cash to shareholders through dividends, buybacks, or deleveraging, with a target to reduce leverage from 6.6 times to about 5 times by 2026 [53] Other Important Information - The company has achieved $220 million in synergies from the acquisition and has revised its synergy goal upward by an additional $20 million [16] - The company has a significant backlog of wavelength services that have been installed but not yet customer accepted, with an expected run rate of $20 to $25 million by the end of the year [36][40] Q&A Session Summary Question: How much is the integration cost affecting quarterly EBITDA? - The integration costs are approximately $4 million a month, expected to taper off over the next 18 months [10][14] Question: What is the growth outlook for core services? - Core on-net services are growing in the mid-single digits, while NetCentric services have seen some deceleration to about 8% revenue growth [25] Question: How is the company addressing the decline in noncore products? - The company has significantly reduced noncore product revenues and is focusing on eliminating unprofitable products [22] Question: What is the company's approach to capital allocation? - The company is considering a shift from dividends to buybacks or deleveraging, with a commitment to return cash to shareholders [50][53] Question: What is the status of noncore asset divestitures? - The company is motivated to divest noncore assets and has six letters of intent for data centers, while being cautious about selling IPv4 assets [54][55]