Liberty Broadband Corporation

Welcome to the Liberty Broadband 2024 Q2 earnings call. During the presentation, all participants will be in a listen-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 is being recorded today, August 8, 2024. I would now like to turn the call over to Claire Adams, Senior Manager, Investor Relations. Please go ahead.

Good morning. Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private 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 most recent Forms 10-K and 10-Q filed by Liberty Broadband and Liberty Trip Advisor with the SEC. These forward-looking statements speak only as of the date of this call, and Liberty Broadband and Liberty Trip Advisor expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein, to reflect any change in Liberty Broadband or Liberty Trip Advisors' 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 Liberty Broadband, including adjusted OIDSA. Information regarding the comparable GAAP metrics, along with required definitions and reconciliations, including preliminary note and Schedules 1 and 2, can be found in the earnings press release issued today, as well as earnings releases for prior periods, which are available on Liberty Broadband's website. Now I'd like to introduce Greg Maffei, Liberty's President and CEO.

Thank you, Claire, and good morning to all our listeners. Today, speaking on the call, we will have Liberty Broadband's Chief Accounting and Principal Financial Officer Brian Wendling, Ron Duncan, CEO of GCI, and Pete Pound, CFO of GCI, will also be available to answer questions. And during Q&A, we will answer questions if there are any related to Liberty Trip Advisor. So beginning first with Liberty Broadband, in July, we issued $860 million of the three and an eighth charter exchangeables. We used the proceeds from that offering to repay $540 million under our charter margin loan and repurchase $300 million of our existing three and an eighth exchangeables. We've also extended the margin loan maturity to 2027 and our 2026 debt maturities are now spread through 2028. As a result of these actions, we expect substantial interest savings. We resumed our sales at Liberty Broadband into charters buyback in June. With the proceeds, we will continue to take a prudent approach about retiring debt, and that is our current focus. We will also evaluate those LBRD buybacks as cash bills from charter share purchases. Charter, looking at the underlying company, they had well-received strong results in the quarter against the competitive backdrop and the expiration of the ACP program. They reported a net subscriber loss of 149,000 broadband subs, but the majority of those were due to ACP, and the broadband trend did improve throughout the quarter with the lowest net loss in June. Charter reported solid EBITDA growth of 2.6% versus the prior year and 100 basis point margin improvement. Management did a great job of expense management, working with the growing realization impacts of that in the second quarter. They continue to manage the cost structure without sacrificing growth. Mobile achieved its profitability for the first time, an important milestone that reinforces the value of the mobile offering. Charter reported 557 mobile line net additions. The Anytime Upgrade program is driving ARPU as customers increasingly chose Unlimited Plus plan. The phone buyout program for multi-line households to move more easily to Spectrum Mobile is also being very effective. We expect continued EBITDA growth to the back half of the year. We will see the AC impact mostly in the third quarter and some in the fourth, but believe Charter is managing that transaction effectively. The cost initiatives continue to support the highest margins to date, and we do expect to see political spending ramp through the year. We also expect to see continued strong mobile performance. Charter reduced leverage during the quarter to 4.32 times, and Charter expects to continue to move closer to the middle of the target of the four to four and a half times leverage range throughout the year. Turning now to Liberty Trip, we continue to evaluate strategic alternatives with TripAdvisor's special committee, and we will not be able to comment further until or unless definitive documents are executed or discussions terminate. Looking at TripAdvisor itself, during the quarter it felt continued pressure on Hotel Meta, in-brand TripAdvisor, from both SEO and SEM structural challenges with weaker demand and increased competition. However, positive early results from strategy work launched last year are beginning to take hold. We've seen a growing share of app users and direct channel activity where there's more monetization opportunity available. Members using TRIF's planning tool have a 15 times higher ARPU than the platform-wide average. The strategy is designed to drive mix shift over time from legacy offerings to focus on member value, a differentiated app experience, and engaging product features. For example, AI-powered review summaries and hotel booking directly into the app and user upgrades are much more effective and better monetization opportunities for us. Looking at the other businesses within Trip, Viator and The Fork both increased their competition to the profit mix, Viator saw a doubling of active bookers who log into the app, which led to higher conversion, better repeat rates, and GBV growth. So with that, I'll turn it over to Brian to discuss the financials.