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ATN International, Inc.
8/8/2025
At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To participate, you will need to press star 1-1 on your telephone. You will then hear a message advising your hand is raised. To withdraw your question, simply press star 1-1 again. Please note, this conference is being recorded. Now it's my pleasure to turn the call over to the BP Corporate Treasurer, Michelle Satrosky. Please proceed.
Thank you, Operator, and good morning, everyone. I'm joined today by Brad Martin, APN's Chief Executive Officer, and Carlos Doglioli, APN's Chief Financial Officer. This morning, we'll be reviewing our second quarter 2025 results and reaffirming our 2025 outlook. As a reminder, we announced our 2025 second quarter results yesterday afternoon after the market closed. Investors can find the earnings release and conference call slide presentations on our investor relations website. Our earnings release and the presentations contain certain forward-looking statements concerning our current expectations, objectives, and underlying assumptions regarding our future operations. These statements are subject to risks and uncertainties that could cause actual results to differ from those described. Also, in an effort to provide useful information to investors, our comments today include non-GAAP financial measures. For details on these measures and reconciliations to comparable GAAP measures, and for further information regarding the factors that may affect our future operating results, please refer to our earnings release on our website at ir.atm.com or the 8K filing provided to the SEC. Now I'll turn the call over to Brad.
Good morning and thank you for joining us today. Let me begin by recognizing our dedicated team across ATM for their unwavering focus on execution and continued progress in advancing our long-term strategic priorities. Our Q2 results were in line with our expectations and reflect the steps we're taking to optimize our cost structure. As expected, revenue declined 1% year-over-year, primarily due to the wind-down of subsidy programs. While adjusted EBITDA decreased 6%, net cash from operations rose 2% to approximately $60 million. Across the business, our focus on simplification, operational stability, and disciplined capital allocation is driving stronger cash generation. Consistent with our commitment to delivering sustainable returns to shareholders, I'm pleased to highlight that our Board of Directors approved a 15 percent increase in our quarterly dividend, raising it up to 27.5 cents per share. This reflects the confidence we have in the underlying strength and resilience of our cash flow. It also reinforces our commitment to delivering sustainable value to shareholders while maintaining a disciplined approach to capital allocation. The strategic investments we've made continue to deliver returns. In the second quarter, we expanded the number of broadband homes passed by high-speed data services by 8% and grew our high-speed subscriber base by 1% year over year. We remain firmly committed to our long-term strategy, capitalizing on our fiber, fiber fed, and broader network infrastructure to deliver essential, high-value services in underserved markets. This vision is underpinned by a solid and strengthening financial foundation. Let me take a moment to review the performance of our two business segments in the second quarter. In our international segment, we continue to make steady progress on our strategic priorities, enhancing mobile networks, improving subscriber and service quality, and driving operational efficiency. These efforts are translating into tangible results. Adjusted EBITDA for the segment remained essentially flat compared to last year, reflecting the balance between strategic investment and disciplined cost management. Importantly, we are seeing improvements in the quality of our mobile consumer base. In our largest mobile market, post-based subscribers grew by 4% year-over-year, and we continue to experience positive momentum in the number of customers purchasing and consuming data plans, which rose by 25% year-over-year. We've also delivered two consecutive quarters of improvement in customer retention. Mobile churn rates declined by more than 5% for the second quarter in a row, driven by better network performance, automation, and a sharper focus on operational execution. While overall consumer fixed revenue remains flat, we saw encouraging signs of stabilization and growth. High-speed data ARPU and subscriber churn both improved by 3% year-over-year, offsetting the ongoing decline in legacy services. Our focus remains on driving sustainable value across our international footprint by deepening customer engagement, optimizing operations, and enhancing profitability. In the U.S. segment, our performance continues to reflect the anticipated impacts of discontinued subsidy programs and the continued phase-out of legacy consumer service technologies. Despite these known headwinds, we are seeing early signs of progress. The demand for carrier services, such as backhaul, is strong, and we are progressing nicely on our carrier-managed services bills. Additionally, we have seen improvement in our sales execution, specifically in the rural healthcare marketplace. Although this segment is primarily focused on business and wholesale markets, we have made progress in delivering fiber and fiber-fed high-speed data broadband services. Our consumer broadband subscriber base grew more than 10% this quarter, and we are seeing positive trend in our people. We remain focused on the strategic transformation, expanding fiber and fiber-fed fixed wireless across markets where we have durable consumer market presence, while growing our base of business and carrier solutions. We are aligning our network or to market approach and capital investments with this long term vision. So the transition continues to weigh on revenue. We are laying the foundation for a more resilient and higher margin domestic business. We are moving forward with more than $300 million in broadband infrastructure initiatives backed by government funding, with more than half of these projects slated for completion in 2025. These projects are a key pillar of our long-term U.S. growth strategy, allowing us to broaden our fiber network more efficiently and positioning us for future revenue gains as they come online. On the policy side, we continue to closely track evolving subsidy programs, FCC policy advancement, and trade and tariff developments. We remain confident in our ability to absorb any short-term effects within the parameters of our current 2025 financial guidance. We're actively collaborating with vendor ecosystems, local and federal regulators, and state broadband offices to manage outcomes in the best interest of ATN shareholders. Looking ahead, our improved cash generation in the first half reflects the disciplined approach we continue to take toward both cost management and capital deployment, positioning us well for the second half of the year. These early results reinforce our confidence in the path forward, and we are reaffirming our full-year guidance as outlined during our fourth quarter earnings call. As we look to the remainder of 2025, our strategic priorities remain clear. Continue improving quality and efficiency of our operations, especially in international markets where we see strong demand and steady performance. advance the transition of our U.S. business by growing fiber and carrier services while managing the phase out of non-strategic legacy products, and maintaining financial discipline to support long-term value creation. While macroeconomic conditions and competitive dynamics remain fluid, our results this quarter demonstrate we are moving in the right direction, strengthening our operational base and positioning ATN for durable growth. With that, I'll turn it over to Carlos to review the numbers.
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