Frontier Communications Parent, Inc.

Good morning. Thank you for attending today's Frontier Communications first quarter 2024 earnings call. My name is Cole and I'll be the moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you'd like to queue for a question, you can do so by pressing star one on your telephone keypad. I'd now like to turn the conference over to our host, Spencer Kern. Please go ahead.

Good morning and welcome to Frontier Communications first quarter 2024 earnings call. This is Spencer Kern, Frontier's head of investor relations, and I'm joined on the call today by Nick Jeffrey, our president and CEO, and Scott Beasley, our CFO. Today's presentation can be followed within the webcast available in the events and presentation section of our investor relations website. Before we start, please see our safe harbor disclaimer on slide two. This is a reminder that this conference call may include forward-looking statements that involve risks and uncertainties that may cause actual results to differ materially from those expressed today. During the call, we may also refer to certain non-GAAP financial measures which are defined and reconciled in our earnings materials. With that, I'll turn the call over to Nick.

Thanks, Spencer. Good morning, everybody. I'm here today with Scott, and we're excited to share our Q1 results with you. Let's start with the headline of the quarter. We had a strong start to the year and delivered positive revenue growth for the first time since 2015. This is a major inflection point for our company, and it's a fast follow for us, having achieved EBITDA growth last year for the first time in more than a decade. Until now, Frontier has been a story about reinvention. Today, while our reinvention accelerates, our story turns to one of growth. Through consistent execution over the last three years, we've delivered an operational turnaround and emerged as a leader in the fiber industry. Let's talk about how we've achieved this. It all starts with our clear strategy to build fiber, sell fiber, improve service for all our customers, and increase operational efficiency. And at the center of our strategy sits our ambitious purpose, to build the digital infrastructure this country needs to thrive now and into the next century. This is the why behind the work that we do, and we call it Building Gigabit America. Over the last few years, we've advanced our purpose and shown rigor and discipline in executing our strategy. Firstly, we've developed the capability to quickly and efficiently build fiber at scale. We've more than doubled our fiber footprint in just a few short years. Secondly, we've grown our fiber broadband customer base by nearly 60% since 2020. And today we have a record 2.1 million customers connected to our blazing fast fiber internet. Thirdly, we've improved our customer service. 75% of our customer interactions are now digital, driving greater customer satisfaction as reflected in our industry-leading NPS scores. And lastly, we can move faster and with greater efficiency because we've created a simpler and more digital organization. Three years of relentless execution has brought us to where we are today, the largest pure play fiber internet company in America. On the next slide, you can see that fiber now represents the majority of our business. With 6.8 million fiber passing, simple math puts us at 68% of the way towards our initial goal of building to at least 10 million fiber passing. Our fiber broadband customers now represent 70% of our total broadband customer base, And Fiber now accounts for more than 50% of our revenue and 60% of our adjusted EBITDA. We've said as Fiber becomes a greater share of our business, we become an even stronger company. And Q1 is the perfect illustration of this dynamic. Let's turn to slide six to review the details. I shared at the top of the call that we achieved a positive inflection point in revenue growth this quarter. This is a result of our fast-growing fiber business continuing to accelerate. We grew fiber broadband customers by 18% and ARPU by 6% this quarter. Combined, these two metrics helped us deliver total fiber revenue growth of 10%. As data consumption continues to rise, customers are increasingly turning to the best broadband product in the market, fiber. We're also seeing this need for speed translating into higher adoption of symmetrical gigabit plus speeds. And our customers are increasingly purchasing value-added service add-ons such as whole home Wi-Fi and premium tech support. The numbers clearly show how our fiber business is lifting our overall revenue. And it's lifting our EBITDA too. We delivered 5.4% EBITDA growth this quarter, as our revenue growth was supported by our continued focus on cost efficiencies. This is in fact the third quarter in a row of accelerated EBITDA growth and our fastest quarter of EBITDA growth since 2016. Before I turn it over to Scott, let's recap our 2024 priorities on slide seven. This year, we're focused on driving three simple outcomes. Maintaining strong operational momentum, delivering revenue growth and accelerating our EBITDA growth. As our first quarter results show, we're off to a fast start, which puts us in a strong position to deliver accelerated growth for the full year. I'm excited to provide more detail on our longer-term financial goals and the path for driving increased shareholder value at our forthcoming investor update, the exact timing of which will depend on the strategic review process which we announced on a previous earnings call. We're looking forward to this event, and I'll keep everybody posted on timing. I'll wrap up by saying a huge thank you to our customers, employees, partners, and everyone who plays a role in building Gigabit America. And I want to say a special thanks to our IT team. A few weeks ago, we disclosed that we had a cyber incident that impacted some of our IT systems. Our IT team was quickly able to contain the incident and work tirelessly to get us back up and running. And I'm extremely grateful for all their hard work and dedication. And I'm proud of our whole team for rallying together to continue to serve our customers. So thank you all. Scott, over to you.