ATN International’s 2026 Q2 Call: BEAD Funding Timing, Tower Sale Impact, and EBITDA Guidance Clash

Date of Call: Aug 6, 2026

Financials Results

• Revenue: $184.5M, an increase of 2% year-over-year, excluding reduced construction revenues and expected loss of subsidy in USVI
• EPS: $10.71 per diluted share, compared to a loss of $0.56 per share last year, includes gain on tower sale
• Operating Margin: 27% adjusted EBITDA margin, expanded from prior year period

Guidance:

• Full year 2026 adjusted EBITDA expected in the range of $193 million to $193 million, inclusive of initial tower sale impact.
• Capital expenditures net of reimbursable spending expected to remain in the range of $105 million to $115 million for the year.

Business Commentary:

Revenue Growth and Margin Expansion:

• ATN International reported total revenue of $184.5 million for Q2 2026, an increase of 2% year-over-year, excluding the impact of reduced construction revenues and the expected loss of subsidy in the U.S. Virgin Islands. Adjusted EBITDA for the quarter was $49.7 million, reflecting a nearly 9% year-over-year growth, with adjusted EBITDA margin expanding to 27%.
• The growth was driven by positive revenue growth across both international and U.S. segments, combined with lower expenses, including restructuring and depreciation.

Impact of Tower Sale and Spectrum License Sale:

• The initial closing of the U.S. Tower portfolio sale resulted in $268 million in cash proceeds, significantly increasing ATN’s liquidity. Additionally, the company entered into an agreement to sell certain U.S. Spectrum licenses for up to $41 million.
• These actions were aimed at enhancing financial flexibility and optionality, with the spectrum license sale expected to close in 2027.

International Segment Performance:

• The international segment reported total revenue of $96 million, up 1.4% year-over-year, with adjusted EBITDA rising 6.6% to $35.5 million. Adjusted EBITDA margin expanded by 180 basis points to 36.9%.
• Growth was supported by stable operating platforms, fiber expansion, and strong demand in markets like Guyana, driven by economic activity and migration from prepaid to postpaid mobile services.

Domestic Segment and Government Funding:

• The domestic segment saw revenue of $88 million, up over 2% year-over-year. Adjusted EBITDA increased by 4.5% to $19 million, with margin expanding 50 basis points to 21.6%.
• Growth was driven by government broadband initiatives and funding, such as approximately $150 million BEAD funding available for network expansion and infrastructure modernization.

Liquidity and Leverage Improvement:

• ATN International ended the quarter with $332 million in cash, cash equivalents, and restricted cash, a 215 million increase from year-end. Total debt declined to $513 million, improving the net leverage ratio to 0.91 times.
• This improvement was due to the cash proceeds from the tower sale and growth in adjusted EBITDA.

Sentiment Analysis:

Overall Tone: Positive

• "our second quarter results demonstrate continued progress across the business. Our segments delivered positive revenue growth and adjusted EBITDA growth, while expanding adjusted EBITDA margin..." "We have experienced management teams, capable operating organizations, strong infrastructure assets..." "What I have seen gives me a high degree of confidence in ATN's future."

Q&A:

• Question from Conference Call Participant (name not specified): Could you elaborate on the growth opportunities in the U.S. segment, particularly in Alaska and the Southwest?
  Response: CEO highlighted significant growth opportunities driven by government broadband initiatives, fiber deployment, and copper replacement, with new CEO appointed for Alaska and ongoing fiber construction in Southwest markets.

Contradiction Point 1

BEAD Funding Impact Timing

Contradiction on when BEAD funding will significantly impact revenue.

Not specified - Not specified

2026Q2: Excited about ~$150 million in BEAD funding in 2026/2027 to reduce rural service costs and enable fiber expansion. - [Najee Khoury](CEO)

What is the US segment's growth strategy and current progress? - Greg Burns (Sidoti)

2026Q1: BEAD monetization will have a more significant impact in future years (2027-2028), not in 2026... BEAD will be more like the next coming years and will not have a significant impact on 2026 revenue. - [Carlos Doglioli](CFO)

Contradiction Point 2

Segment Financial Performance Outlook

Contradiction in the expected growth contribution from the Domestic segment.

Not specified - Not specified

2026Q2: Domestic Segment: Revenue: $88 million, up 2.1% year-over-year. Adjusted EBITDA: $19 million, up 4.5%, with margin expansion of 50 basis points to 21.6%. - [Carlos Doglioli](CFO)

What were the segment results in Q2 2026? - Greg Burns (Sidoti)

2026Q1: Revenue trends are positive year-over-year... revenue growth is progressing. - [Carlos Doglioli](CFO)

Contradiction Point 3

Impact of U.S. Tower Asset Sale on Business Model

Contradiction on whether the sale fundamentally changes the company's operational model.

Not specified - Not specified

2026Q2: [The U.S. segment focuses on modernizing infrastructure, expanding customer reach, and migrating from legacy networks.] - [Najee Khoury](CEO)

What is the US segment's growth strategy and progress? - Gregory Burns (Sidoti)

20260305-2025 Q4: The continuation of the business model will remain; we'll just be doing more on third-party towers. - [Brad Martin](CEO)

Contradiction Point 4

2026 Full-Year Financial Outlook

The guidance for adjusted EBITDA in 2026 is notably different.

Not specified - Not specified

2026Q2: Reaffirmed full-year adjusted EBITDA in the range of $193-193 million (includes tower sale impact). - [Carlos Doglioli](CFO)

What is the financial position, outlook, and capital allocation? - Gregory Burns (Sidoti & Company, LLC)

2025Q3: With more normalized CapEx levels, leverage (net debt ratio) is expected to continue declining. - [Carlos Doglioli](CFO)

Contradiction Point 5

Capital Allocation and Shareholder Returns

The 2026Q2 call announces an expanded share repurchase authorization, while the 2025Q3 call discusses stable leverage targets.

Not specified - Not specified

2026Q2: - Share repurchase authorization expanded to $30 million. - [Carlos Doglioli](CFO)

What is the company's financial position, outlook, and capital allocation strategy? - Gregory Burns (Sidoti & Company, LLC)

2025Q3: With more normalized CapEx levels, leverage (net debt ratio) is expected to continue declining. - [Carlos Doglioli](CFO)