Liberty Capital Corporation

Welcome to the GCI Liberty 2025 Q2 earnings call. During the presentation, all participants will be in a listening-only mode. Afterwards, we will conduct a question-and-answer session. At that time, if you have a question, please press star 1 on your telephone keypad. As a reminder, this conference will be recorded as of today, August 7, 2025. I would now like to turn the call over to Shane Kleinstein, Senior Vice President of Investor Relations. Please go ahead.

Thank you, and good morning. Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the Meaning of Applied and Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the prospectus forming part of GSA Liberty's registration statement and the most recent forms 10Q followed by GSA Liberty and Liberty Broadband with the SEC. These forward-looking statements speak only as of the date of this call, and GSA Liberty and Liberty Broadband expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in GCI Liberty or Liberty Broadband's expectations with regard thereto, or any change in events, conditions, or circumstances on which any such statement is based. On today's call, we will discuss certain non-GAAP financial measures for GCI Liberty, including adjusted OIBDA, adjusted OIBDA margin, and free cash flow. Information regarding the required definitions, along with comparable GAAP metrics and reconciliations, including Schedule I, can be found in the earnings press release issued today, which is available on GCI Liberty's website. Today speaking on the call, we have Ron Duncan, CEO of GCI Liberty, Ryan Wendling, GCI Liberty's Chief Accounting and Principal Financial Officer. And also during Q&A, we'll answer questions related to Liberty Broadband. Members of both GCI and Liberty Broadband Management will be available to answer questions during the Q&A portion. With that, I will turn the call over to Ron.

Good morning. Good morning. We were pleased to complete the spinoff of GCI Liberty from Liberty Broadband last month, allowing me to speak to you today on our first quarterly call as a once again public company. 2025 is off to a great start. GCI continues to lead in the provision of statewide service to all of our customers. This has been of particular value to our rural health and education customers. In the last 12 months, We have achieved significant upsells in this segment as rural schools and clinics have purchased additional bandwidth. We grew consumer wireless subscribers 1% year-over-year, ending the quarter with 207,000 subscribers. During the quarter, we added 4,700 consumer wireless lines. On the data side, we saw a 3% decline year-over-year, ending the quarter with 154,500 cable-motor subscribers. During the quarter, we lost 1,300 data subscribers. The decline of data subs over the past year is largely due to the elimination of the ACP program in 2024, the fiber break on a third-party network in which GCI uses capacity, Starlink competition, and wireless substitution. Financially, these results have translated into a record last 12 months of $405 million as of the second quarter. The USF challenge at the Supreme Court, which had been an overhang on our business and led to a negative credit watch earlier in the year, has been definitively and favorably resolved. Looking at several other financial highlights, in March, we successfully refinanced our senior credit facility and pushed out maturities to 2030 and 2031. In the second quarter, we were able to reduce our net debt by $86 million, bringing our total leverage down to 2.3 times as defined by our credit agreement. The combination of these events led S&P to eliminate the negative credit watch and raise our credit rating in July. We're proud of the progress, both financially and operationally, over the first half of the year. While we're now a standalone public company, it's business as usual for our team in Alaska. We remain focused on improving our infrastructure to deliver high-quality service to our customers, furthering our rural expansion to bridge the digital divide and increasing the efficiency of our business. I'll go into a bit more detail in several areas. Starting with our network infrastructure, we are offering two and a half gigabit broadband connectivity in areas that have fiber middle mile, which cover an overwhelming majority of our customers. Material progress is being made in improving the broadband network in Anchorage as we are in the process of upgrading the core, reducing node sizes, and upgrading the plant to 1.8 gigahertz. All of the work that we are doing is DOCSIS 4.0, or 4.0 capable, enabling speeds that are multiple times what we have today. We will be rolling this out to other markets in the coming years, allowing us to get to 5 gigabits and ultimately beyond. We believe these changes will not only lead to higher speeds, but also a network that has fewer maintenance requirements. The strength of this offering positions us well against competitors today and into the future. On wireless, we are encouraged by early signs that our wireless postpaid business is growing again. We launched our unlimited test drive promotion in April of this year. This offers our broadband customers a discounted price to gain access to unlimited broadband and add a wireless line. This promotion is driving growth for both our GCI Plus converged product and postpaid wireless lines, with sequential growth in postpaid lines of 3,400 in the second quarter. We expect to roll out other new pricing and packaging offers later this year to drive further growth in our wireless products. We plan to provide 5G wireless service to all Alaskans over the coming years. We continue to bridge the digital divide in Alaska with rural expansion. As I mentioned, we are happy to have the Universal Service Fund ruling behind us. This was an enormous win for the Universal Service Fund, the state of Alaska, and all of the providers in Alaska, including GCI. The Supreme Court's decision clearly affirms the legal foundation of this important program. On the Alaska plan, we expect to complete the first phase and meet our build-out requirements in 2026. This will increase wireless speeds in the communities we're serving. The FCC's new Alaska Connect Fund will extend the Alaska plan and increase the amount of support. This will aid in the deployment of 5G wireless throughout Alaska. On BEAD, the state of Alaska was allocated up to $992 million in funding for infrastructure projects to connect unserved and underserved locations. Recent changes to the program make it unlikely that the state will be able to award the full amount of its allocation. GCI submitted several applications to participate in the Alaska BEAD program. Any monies that GCI has awarded will defray our capital costs as we expand in unserved locations. but this funding is not currently factored into our complex budgeting. Finally, on our effort to increase efficiency in our business. For the past year and a half, we've been engaged in efforts to proactively manage our cost structure. In 2024, we reorganized our tech organization, and early this year hired our first ever chief technology officer, Troy Goldie, who has been leading the efforts to make sure that our technology team is both effective and efficient. I'm very pleased with the early results in the CTO group. We are continuing our efforts to streamline the business and increase efficiency by implementing new systems and applying the lessons learned in the CTO reorganization to other elements of the company. We expect these efforts will help maintain better discipline across our entire cost structure. Before closing, I should comment briefly on the Alaska economy. The market has been flat up here with a slowly declining workforce for over a decade. The state government is challenged by the lack of a credible fiscal plan. The drop in oil prices has contributed to the delays. There hasn't been much good news to talk about. However, the new administration's change in resource policy with respect to both oil and mineral exploration make me cautiously optimistic about Alaska's economic future. More importantly, there could be a ray of hope on the horizon. For 50 years, Alaskans have dreamed about the construction of a natural gas pipeline from Crudeau Bay to Tidewater. This has always seemed to be a pipe dream, if you will, that was just out of reach. While details are still emerging, the inclusion of significant purchases of Alaska gas and the promise of investment by Japan in the President's recently announced trade deal could change the game. Adding cheap energy to an environment where average temperatures are cooler and there is an abundant land abundance of land and water could make Alaska a very appealing location for participants in the AI economy. There's still a lot of skepticism and some genuine doubt, but we hope to know more over the next few months. The construction of a gas line and the export of material amounts of natural gas would clearly be cause for optimism. In the meantime, we welcome anyone else to join us here in Alaska where we would remind you The water flows well, the climate stays cool, and the environment is wonderfully conducive to the demands of the ever-growing data center industry. To our listening audience and telco analysts, please spread the word. In summary, we remain confident in our ability to deliver high-quality service to the state of Alaska with both the breadth and caliber of our network and service. We believe the quality of our infrastructure and durability of our financial results will drive value for customers, partners, and shareholders. With that, I'll turn to Brian to discuss the financials in more detail.