High-speed internet additions best ever in Q2
Altice USA added more broadband customers in the second quarter than ever, spurred by stay at home orders throughout its service territory as the pandemic rages on, and prompting the company to reinstate guidance for the rest of the year.
Altice USA said it added 70,000 broadband customers in the period, more than five times the 13,000 it added in the prior year. Including complimentary Altice Advantage Internet customer net additions, residential broadband customers rose by 79,000 in the quarter. That growth fell to 53,000 additions when adjusted for customers receiving broadband via programs like the FCC Keep America Connected Pledge and a New Jersey order prohibiting companies from disconnecting broadband service for non-payment. But even with the lower number, Altice had its best broadband quarter ever.
At the same time, video subscribers fell by about 35,000 in the period, up from a loss of 21,000 customers in the same period last year.
Like its other cable peers, Altice USA attributed the broadband gains to the pandemic. The company added that internet usage in its service territories rose by 59% in the quarter, while video streaming was up 46% year-over-year.
Total revenue was up 1% to $2.47 billion and EBITDA grew 2.5% to $1.1 billion.
“Our core cable business performed extremely well, and we remain committed to serving our broader community with the connectivity and news they need during this unprecedented time,” Altice USA CEO Dexter Goei said in a press release. “For the second consecutive quarter, we delivered best-ever customer net additions, driven by organic broadband growth, and increased revenue, net income and Adjusted EBITDA year-over-year. We saw resilience in our Business Services segment, where we grew revenue more than two percent, and began to see a recovery in our News and Advertising business as we exited the quarter. While the pandemic continues to pose some uncertainty in the back half of the year, we are encouraged by the strength and resilience of our business, and by the opportunity set presented.”
As a result, Altice USA has decided to reinstate guidance for the full year — it withdrew guidance in Q1 because of the pandemic. Now the company said it projects revenue and EBITDA growth for the full year, capital expenditures of $1.3 billion and $1.7 billion in share repurchases. The company has set a year-end leverage target of 4.5 times to 5 times net debt/adjusted EBITDA.