American Tower Corporation (REIT)

Ladies and gentlemen, thank you for standing by. Welcome to the American Tower fourth quarter and full year 2025 earnings conference call. As a reminder, today's conference call is being recorded. Following the prepared remarks, we will open the call for questions. If you'd like to ask a question, please press star one one on your telephone. You will then hear an automated message advising your hand is raised. I would now like to turn the call over to your host, Spencer Kern, SVP of Investor Relations. Please go ahead.

Thank you, and good morning. Welcome to our fourth quarter 2025 earnings call. I'm Spencer Kern, head of Investor Relations for American Tower. Joining me on the call today are Steve Vondran, our president and CEO, and Rod Smith, our executive vice president, CFO, and treasurer. Following our prepared remarks, we will open the call for your questions. Before we begin, I need to call your attention to our safe harbor statement. It says that some of our comments today may be forward-looking. As such, they are subject to risks and uncertainties described in American Tower SEC filings, and results may differ materially. Additional information is available on our investor relations website. With that, I'll turn the call over to Steve.

Thanks, Spencer. Good morning, everyone. Thanks for joining today's call. As you can see from our published results, we had a great year and an excellent fourth quarter. For the full year, we delivered attributable AFFO per shares adjusted growth of 8%, including over 13% growth in the fourth quarter. These results were underpinned by robust leasing demand across our tower and data center businesses and strong execution against our strategies. Over the past year, we've taken meaningful steps to improve our earnings quality and durability. We've steered capital toward developed markets, globalized and simplified our operations, and brought leverage back down to our target range. These actions put us on strong footing to capitalize on future growth opportunities and deliver on our goal of industry-leading ASFO per share growth. Before turning the call over to Rod to review our detailed financial results in 2026 Outlook, I'd like to spend a few minutes discussing our key priorities for 2026 as outlined on slide five of our earnings presentation. First, driving durable revenue growth. The backbone of our revenue growth is mobile data consumption, which continues to grow rapidly alongside growth in mobile customers, 5G adoption, and fixed wireless access. This secular demand growth is expected to require a doubling in wireless network capacity between now and 2030. On top of this, with trillions of dollars being deployed into AI, it's likely that new AI applications will propel mobile data consumption even higher and require greater bandwidth, lower latency, and more uplink capacity than today's typical usage. In our largest tower market, the US, carriers are in the middle stages of the 5G cycle, where they've broadly completed their initial 5G coverage-oriented activity and are shifting toward capacity-oriented activity. We anticipate carriers will densify their networks, not only to meet the capacity demands of 5G, but also to plan ahead for the 6G cycle. We're excited about the 800 megahertz of higher frequency spectrum that's been earmarked for 6G and believe its deployment will drive significant activity on towers. As carriers invest in this capacity, we expect our U.S. portfolio to deliver durable, long-term, mid-single-digit organic growth. As you saw in our 8K forum from January, DISH has defaulted on its payment obligations. We continue to pursue legal action to recover the value of its remaining lease obligations. And while DISH's default negatively impacts our 2026 outlook, in the long run, we expect our business to benefit from a healthier, well-capitalized customer base that can invest more heavily in their mobile networks. Internationally, we see parallel trends of rising data consumption driving durable network investment. In our European market, 5G progress lags slightly behind the U.S., and strong demand for new sites is prompting exciting levels of new build activity with top-tier carriers. In our emerging markets, 4G-related activity continues to dominate, but we see increasing levels of 5G rollouts in key metros with significant runway for growth. We continue to expect our international tower portfolio to deliver faster organic growth in the U.S. as our less mature portfolios lease up over time. In our data center business, strong demand for hybrid and multicloud deployments and positive pricing actions continue to yield impressive double-digit growth. Demand for AI-related use cases, like inferencing and machine learning, is driving an increasing portion of new leasing, and CoreSight's AI-ready platform is equipped to accommodate these higher-density, interconnection-heavy workloads within its existing cost structure. CoreSight is also benefiting from sustained migration of enterprise IT infrastructure from on-premises to interconnection-rich colocation facilities. These powerful demand trends, combined with our unique interconnection-oriented infrastructure, continue to support CoreSight's achievement of mid-teens or higher stabilized yields on new data center deployments. Our second priority is operational efficiency. This has long been a key operating principle at American Tower. Over the past three years, we've worked diligently to improve our cost structure by centrally aligning our regional groups divesting non-core business units, and automating leasing transactions. These initiatives have helped deliver over 300 basis points of cash EBITDA margin expansion across our global tower portfolio since 2022. And today, we have the highest like-for-like tower cash EBITDA margins amongst our peer groups. The bulk of our recent cost efficiency efforts have focused on reducing SG&A, which for our tower business is best in class at approximately 4.5% of revenues. With the creation of our global COO position last year, we've undergone an extensive review of the direct costs within our tower business in an effort to bend our cost curve and grow direct expenses at a slower rate than revenue. We've identified four key areas of expense savings across our global tower portfolio. First, managing land expense, which is our most significant direct cost by expanding our highly successful US-based land optimization program to other markets. Second, implementing a global unified sourcing and supply chain to enable economies of scale, gain pricing advantages, and improve inventory management. Third, accelerating the adoption of our well-developed standard of care for U.S. assets across our global portfolio to improve repair and maintenance costs. And fourth, simplifying and standardizing internal technology platforms to optimize customer service and accelerate automation. We expect these new initiatives, in conjunction with continued strong conversion rates, to drive 200 to 300 basis points of tower cash EBITDA margin expansion over the next five years. On top of this, we're investing in AI to accelerate efficiency gains even further. While we're still in the early stages of AI adoption, we expect AI use cases to target process automation, predictive maintenance, power and utility management, and workflow optimization. We look forward to updating you on our AI endeavors and accelerated efficiency targets in the future. Moving to our last priority for the year, capital allocation. We remain disciplined stewards of capital and strive to generate durable cash flow growth with high returns on invested capital. Now that we're back within our target leverage range, we have significant flexibility. After funding our dividend, we will opportunistically assess the best uses of our capital among internal CapEx, M&A, share repurchases, and further delevering. This year, we plan to deploy the vast majority of growth CapEx to our developed tower markets and core site that will continue to manage our global portfolio in ways that accelerate growth and reduce volatility. Before turning the call over to Rod to discuss our 2025 results and 2026 outlook, I'd like to thank our incredible employees for delivering another excellent year. We've established a best-in-class platform for capitalizing on strong industry demand drivers, and I'm confident that we're well-positioned to execute our 2026 priorities and drive accelerating durable growth into 2027 and beyond. Rod, over to you.