Cable One, Inc.

Before we proceed, I would like to remind you that today's discussion contains forward-looking statements relating to future events that involve risks and uncertainties, including statements regarding future broadband revenue, customer growth, connects and churn rates, new product rollouts, anticipated cost savings and other benefits to be derived from our billing system migration and our other investments in growth enablement platforms, anticipated benefits from our mobile service pilot program, future cash flow, ARPU and capital expenditures, future levels of competition, potential stock buybacks, our ability and sources of capital to fund the retirement of our 0% convertible notes in 2026, the estimated MBI put call purchase price, MBI's future debt levels, the anticipated after-tax proceeds from the expected monetization of certain investments, expected cash tax savings to be realized as a result of the recently passed federal tax bill, our CEO succession process and our future financial performance, capital allocation policy, leverage ratios and financing plans. You can find factors that could cause Cable 1's actual results to differ materially from the forward-looking statements discussed during today's call and today's earnings release and our SEC filings, including our annual report on Form 10K and our forthcoming second quarter 2025 quarterly report on Form 10Q. Cable 1 is under no obligation and expressly disclaims any obligation except is required by law to update or alter its forward-looking statements whether as a result of new information, future events or otherwise. Additionally, today's remarks will include a With U.S. generally accepted accounting principles or GAP. When we refer to free cash flow during today's call, we mean adjusted EBITDA less capital expenditures as defined in our earnings release. Reconciliation of non-GAP financial measures discussed on this call to the most directly comparable GAP measures can be found in our earnings release or on our website at .Cable1.net. Joining me on today's call is our President and CEO Julie Lawless and Todd Cucci, our CFO. With that, let me turn the call over to Julie.

Thank you, Jordan, and good afternoon, everyone. We appreciate you joining us for today's call. This quarter's results were influenced by a combination of internal actions we took during the period as well as a few external factors. These included some pricing and packaging adjustments for a subset of our customers, double the typical volume of promotional roll-offs, continued competitive headwinds, and seasonal softness in our college markets. Against that backdrop, residential broadband revenue increased on a sequential basis by 1.9 percent compared to the first quarter, driven primarily by higher ARPU. Business data revenue was $57.4 million and Consolid Adjusted EBITDA was $203.2 million, both results consistent with Q1 levels. Despite the residential broadband customer losses we experienced in the quarter, we're encouraged by the sequential improvement in connects throughout the first half of the year, with continued -over-month growth in June, representing the first month during 2025 with a -over-year increase in connects. We believe our drive towards simplified pricing, segmented marketing campaigns, and value enhancing product and service offerings is laying the groundwork for stronger subscriber uptake and improved operating performance over time. In addition, the completion of the final phase of our billing conversion marks a key milestone in multi-year investment in growth enablement platforms, positioning us for more agile product launches and deeper customer engagement going forward. I'll first review residential broadband customer trends. Residential data customers declined by 13,000 in Q2, driven by continued softness in connects and elevated turn. However, as I just noted, we have seen sequential month over month growth in connects every month this year through the end of Q2. This trend suggests our new products and -to-market strategies are showing early signs of positive impact. Elevated disconnects this quarter were driven by customer response to recent segmented pricing changes, turn arising from promotional roll-offs, and seasonal turn in our college markets. Completing the final phase of our AutoPay Plus rollout also resulted in some incremental turn. But AutoPay Plus, which includes a $5 surcharge for non-enrolled customers, has been a positive program for us by either increasing our POOP or reducing billing costs and improving retention over time. Broadband revenue increased on a sequential -over-quarter basis, driven by a $2.39 increase in our POOP. This was due to the impact of segmented pricing changes, as well as promotional explorations, greater adoption of value enhancing services like Secure Plus and Ultimate Wi-Fi, and as I noted above, the completion of the rollout of our AutoPay program. Selling to premium speed tiers of gig or above remained high at 46%, reinforcing customer demand for higher speed plans and further supporting our POOP. Looking ahead, we expect our POOP to remain stable for the remainder of the year. We're seeing early traction with Lyft Internet, which is helping us reach value conscious customers in a financially sustainable way. FlexConnect adoption has not met our expectations to date, but we continue to believe that both FlexConnect and Lyft will play an important role in today's competitive environment. These products compete directly on price with cell phone internet, while offering a superior experience with unlimited data, consistent speeds, and greater reliability. Key differentiators, given that our customer average data usage is now nearly 800 gigabytes per month, and over 27% of our customers regularly surpass a terabyte of data. To further elevate our customers connected home experience, we recently launched TechAssist, a $10 per month support service that offers expert with a wide range of Wi-Fi connected devices outside of our internet equipment. From setup to troubleshooting and ongoing support, TechAssist provides customers with convenient, reliable assistance for tech issues related to smart thermostats, doorbells, security cameras, and more. While we don't expect TechAssist to generate material revenue in 2025, it reflects our focus on delivering customer-centric innovation and practical value-added services that simplify daily life for our customers. We are optimistic it will begin to generate meaningful results in 2026 and beyond. Turning to competitive dynamics, Fiber to the Home overbuilds, largely from incumbent teleco providers, now represent approximately 53% of our passings. In addition, cell phone internet competition is nearly ubiquitous across our footprint. While we expect competitive intensity to persist, we believe our neighborly service, enhanced platforms, and evolving set of products position us to defend and grow share over the long term. We're continuing to fight hard for every new customer while staying focused on retaining our existing ones. While we're seeing some encouraging signs, steady -over-month growth and connects during the first half of the year, stable ARPU, and early momentum from new products, given the customer losses we experienced in the second quarter, we do not expect to grow total residential broadband customers in 2025. In addition, we currently expect total residential broadband revenue for 2025 will be flat or decrease modestly for the full year as compared to 2024. We remain focused on driving innovation that simplifies the customer experience and enhances operational efficiency. One example is AskTommy, our AI-powered assistant that not only handles tasks typically managed by our field techs, like contacting customers with appointment windows and rescheduling when necessary, but also provides techs with AI-driven technical expertise to help diagnose and resolve issues more quickly. This tool reflects the kind of everyday workflows we're beginning to automate, allowing us to better allocate resources and dedicate our highly trained technicians to more complex service needs. This is just one example of how we're using AI in practical, impactful ways. Earlier this month, we executed the final phase of our billing system migration, transitioning Hargrey and Legacy Sparklight customers onto our unified platform. This initiative consolidated more than 30 legacy programs, enabling all acquired companies to operate under the Sparklight brand. This project was central to our ongoing transformation. Being on a unified platform will significantly enhance the customer experience by streamlining our rate structures across markets, enabling more flexible pricing, and allowing us to respond more quickly to competitive changes. It also delivers a faster, more intuitive interface for our customers. While this represents a significant step forward, there are a number of post-migration workstreams to be completed before we fully realize the benefits of this transformation. We expect the billing migration will result in several million dollars in annual cost savings, starting in late 2025, as we further leverage the system for pricing, product, and service innovation. We're excited to share that we've signed an agreement with a mobile virtual network enabler, or MVNE, to pilot mobile service in several of our markets. This marks the start of a focused initiative to explore whether mobile can complement our wired broadband product by delivering added convenience, greater flexibility, and stronger overall value for customers. By offering connectivity both inside and outside the home, we aim to strengthen long-term relationships and improve retention while meeting more of our customers' everyday needs. Our belief has been that mobile makes sense only if a few key conditions are met. Improved wholesale economics, better mobile network reliability standards in our markets, mature enablement platforms, and a fully featured product with the potential to attract value-conscious customers. The shifting market dynamics and advancements in technology have improved the economic viability of mobile, making this a good time for us to launch this pilot program. Mobile has the potential to enhance customer lifetime value, reduce churn, and support packaging opportunities that reinforce the strength of our core broadband business. We'll take a disciplined approach on this new initiative and see what we learn as the pilot progresses. To wrap up, while competition is fierce and there's a lot more work to do, we believe we are taking the right strategic actions to grow the business over long-term. We're seeing better sequential monthly trends and customer ad activity over the first half of the year, early momentum from some of our new product lines, and we anticipate greater efficiencies and improved customer experience from our unified billing platform going forward. Most importantly, we believe we are building a growth engine thoughtfully and recognize that continued transformation will be required to fully realize our long-term ambitions. And now, Todd, who will provide a recap of our second quarter financial performance.

Thanks, Julie. Total revenues for the second quarter of 2025 were $381.1 million compared to $394.5 million in the second quarter of 2024. Residential video revenues drove the majority of the decrease in total revenues with a -over-year reduction of $9 million, or 15.8%, due to continued video subscriber attrition. Residential data revenues decreased $1.1 million, or .5% -over-year, driven by a .2% decline in subscribers, partially offset by a .4% increase in ARPU. However, on a sequential basis, residential data revenues increased $4.2 million, or .9% over the first quarter, driven by a 3% increase in ARPU. Business services data revenues grew .2% -over-year in Q2 2025, driven by continued strength in our high-value fiber and carrier segments. These high-performing categories benefited from robust sales activity, increased connection volumes, and the ramp of previously announced multi-million dollar long-term contracts. On a sequential basis, business data revenues increased 0.2%. Operating expenses were $102.4 million, or .9% of revenues in the second quarter of 2025, compared to $105.8 million, or .8% of revenues in the prior year quarter. With the decrease driven largely by a reduction in programming costs. Selling, general, and administrative expenses were $92 million for the second quarter of 2025, compared to $90.8 million in the prior year quarter. SG&A as a percentage of revenue was .1% for Q2 2025, compared to 23% of revenue in the previous quarter of 2025. With the increase driven largely by investments in growth enablement platforms, partially offset by a reduction in labor costs. Taken together, these platforms and ongoing operating efficiencies are expected to generate annual run rate cost savings of approximately $15 million across both operating and SG&A expense, including the anticipated savings from our billing system migration. While some of these savings may be offset by inflationary cost pressures or reinvestment in growth initiatives, we expect a meaningful net benefit over time. During the quarter, triggered by a decline in the price of our common stock, we conducted impairment assessments of our intangible assets and goodwill and recognized a combined non-cash impairment charge of $586 million. This charge doesn't impact our cash flows, operational strategy, or growth initiatives. Adjusted EBITDA of $203.2 million was .3% of revenues in Q2 2025. In Q2 2024, adjusted EBITDA was $212.4 million, or .8% of revenues. Capital expenditures were $68.4 million in Q2, a decrease of $3.2 million, or .5% year over year. During the quarter, we invested $8.7 million of CapEx for new market expansion projects and $2.2 million for integration activities. Adjusted EBITDA of capital expenditures, or free cash flow, was $134.8 million in the second quarter of 2025, representing .4% of adjusted EBITDA, compared to $140.8 million and .3% in the prior year. We will continue to evaluate how best to deploy the meaningful free cash flow generated by our business with a steady focus on long-term growth and disciplined conservative balance sheet management. With the passage of the tax bill earlier this month, we expect to realize approximately $40 million of cash tax savings in 2025 and approximately $120 million of aggregate cash tax savings through 2027, based on our preliminary estimates and available information. We used a portion of our substantial free cash flow, in addition to cash savings from dividend suspension, to pay down over $70 million of debt during the quarter. On top of nearly $5 million of scheduled term loan amortization payments, we voluntarily paid down $45 million of revolver borrowings and opportunistically repurchased over $21 million of senior notes and term loan borrowings at attractive discounts to face value. This brings our gross debt repayment during the last two years to well over a half a billion dollars, excluding the $175 million revolver draw related to the amendment to our MBI strategic partnership late last year. In addition, we repaid another $25 million of revolver borrowings earlier today. In addition to disciplined debt repayment and deleveraging, we may opportunistically and prudently buy back shares under our remaining $143 million authorization, dependent on the trading level of our common stock, market conditions, and other factors. As of June 30th, we had approximately $153 million of cash and cash equivalents on hand, and our total debt balance was approximately $3.5 billion, consisting of approximately $1.7 billion in term loans, $920 million in convertible notes, $633 million in unsecured notes, $228 million of revolver borrowings, and $3 million of finance lease liabilities. We ended the quarter with substantial committed liquidity available under our $1.25 billion revolving credit facility, providing meaningful financial flexibility. Our weighted average cost of debt the second quarter of 2025 was 3.9 percent, and our net leverage ratio on a last quarter annualized basis was 4.1 times. Nearly $2.8 billion of our $3.5 billion of debt contains fixed or synthetically fixed base interest rates that are substantially below current market rates. Between our free cash flow generation and the substantial available capacity under our revolving credit facility, we expect we will be able to fully retire our 2026 convertible maturities without needing to arrange for additional financing. Even so, we will continue to monitor the capital markets in order to be in a position to take advantage of attractive opportunities should they arise. Turning to MBI, now that the June 30th measurement period has concluded, we've narrowed our estimated range for the purchase price if the call or put option is exercised. We now expect the purchase price to fall between $460 and $510 million, and the amount of MBI's total metandetanus at the time it is acquired will be between $845 and $895 million. If the put option is exercised, we would anticipate the closing to occur on October 1, 2026. Over the last two years, we've completed or announced the monetization of five equity investments, and we expect to continue to evaluate strategic options for our remaining equity investments. Earlier this month, we monetized our stake in Metronet, and our monetization of Ziply remains on track to close before the end of 2025. Together, these transactions are expected to generate in excess of $100 million of combined after-tax proceeds supplemented by the MBI funding, and we expect to continue to implement our discretionary cash and excess liquidity position. Before we open it up for questions, I want to reiterate that although we operate in a competitive environment, we are confident that our strategy will result in long-term, sustainable growth. Between positive monthly connect activity trends during the first half of the year, our new value-focused product offerings, the rollout of segmented marketing campaigns, and expected efficiencies from our investments in strategic growth enablement platforms, we believe we are making progress towards our goal of growing our business over the long term. With that, I'll turn the call back over to Julie before we move into Q&A.