Shenandoah's Q2 2025: Navigating Conflicting Messages on Glo Fiber Competition and Capital Strategy

Competitive pressures in Glo Fiber, capital expenditure strategy and timing, competitive pressures and market share in Glo Fiber services, market dynamics and competitive pressures are the key contradictions discussed in Shenandoah Telecommunications Company's latest 2025Q2 earnings call.



Leadership Transition and Strategy:
- Shenandoah Telecommunications Company (SHEN) announced the promotion of Edward H. McKay to President and CEO, effective September 1, with Christopher E. French transitioning to Executive Chairman.
- This transition is the result of a deliberate CEO succession plan and is intended to capitalize on the company's fiber-first strategy and accelerating growth.

Glo Fiber Growth:
- Glo Fiber revenues grew 40.5% year-over-year to $19.8 million in Q2 2025, with over 5,700 new subscribers and 16,000 new passings.
- The growth is attributed to the transformation of the company from a mature cable and telephone operator to a rapidly growing fiber-first business.

Financial Performance and Synergies:
- Revenue increased by 3.2% to $88.6 million, driven by Glo Fiber growth, while adjusted EBITDA grew by 21.9% to $28.4 million.
- The strong financial performance was due to the high incremental margin of Glo Fiber subscriber additions and realization of synergies from the Horizon Telecom acquisition.

Capital Expenditure and Guidance:
- SHEN expects 2025 CapEx to be $260 million to $290 million net of government grants, with an anticipated decline of approximately 8%.
- The decision to accelerate CapEx into 2025 was driven by the successful construction of government grant projects, which will enhance subscriber and revenue growth in the future.

Commercial Fiber Business Expansion:
- The commercial fiber business booked over $203,000 in new monthly revenue sales, up 32% year-over-year, with an installation backlog of $493,000 in monthly revenue.
- The growth in sales and installations is attributed to strong demand for fiber connectivity and the completion of inherited backlog from the Horizon acquisition.