Windstream (UNIT) Reports Strong 1Q24 Financial Performance

By Bobby Samwell • Saturday, May 04 15:20 • Permanent Link

Windstream Holdings, Inc. has released its 1Q24 financial earnings, reporting strong financial performance across various metrics. The company's adjusted EBITDAR stood at $406 million, showing a 7% year-over-year increase. This growth is backed by a few key factors such as the completion of the sale of IPv4 assets for over $100 million and strong strategic revenue trends.

In terms of revenue, the company witnessed a slight increase in strategic and advanced IP services revenue, which now accounts for approximately 85% of total enterprise market service revenue. Additionally, the consumer segment saw a 1% growth in Kinetic consumer service revenue year-over-year, with a 5% increase in Consumer Broadband ARPU to $89.93.

The company's fiber build momentum continued in 1Q24, with 53,000 new premises added in the quarter, bringing the total premises with access to FTTH services to approximately 1.7 million. Windstream also achieved a 35% coverage of consumer households with fiber broadband by the end of the quarter.

Notably, the company reported a reduction in interconnection expenses, with total interconnection expense falling by 19% year-over-year. This reduction was driven by a significant 27% decrease in legacy TDM-related expenses. Windstream also highlighted its continued execution of a multi-year program to migrate legacy TDM customers to newer technologies, which is aimed at further cost reduction and improved customer experience.

Moreover, the company's financial overview for 1Q24 revealed an adjusted EBITDAR margin of 40.6%, reflecting a positive trend in its operational efficiency.

Looking ahead, Windstream provided guidance for 2024, with expectations of approximately flat year-over-year adjusted EBITDAR, excluding the impact of non-core operating assets sales during the period. The company also anticipates similar levels of fiber consumer customer additions and premises constructed as in 2023.

The market has reacted to these announcements by moving the company's shares -26.4% to a price of $4.44. For more information, read the company's full 8-K submission here.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.