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- **Gross Margin Milestone**: Gross margin hit 69.7%, 160 bps YoY expansion, driven by video mix shift and programming cost savings.
- **Disciplined Subscriber Growth**: Lost 58K broadband subs Q3, but maintained margin discipline with 900 bps churn improvement in mobile.
- **2025 EBITDA Target**: On track for $3.4B, with Q4 expected to deliver first YoY EBITDA growth since 2023.
- **AI and Automation**: Service call resolution rates at all-time highs, with AI tools reducing touchpoints by 30%.
- **Hyperscaler Growth**: Lightpath awarded $100M+ in new contracts, contributing to 2026+ revenue acceleration.

**【CEO Summary】**
- **Revenue Growth and Margin Expansion**: Q3 revenue declined 5.4% YoY, driven by video cord-cutting, but gross margin reached an all-time high of 69.7% due to mix shift away from video and disciplined programming agreements. Adjusted EBITDA margin expanded 70 bps YoY to 39.4%.
- **Broadband Challenges**: Lost 58,000 broadband subscribers Q3, with competitive intensity accelerating in September. Maintained margin discipline by avoiding uneconomic gross adds, prioritizing quality growth.
- **Strategic Initiatives**: Launched 2G HFC speeds in first market, expanded Lightpath hyperscaler contracts, and introduced new video tiers (Entertainment TV, Extra TV) with 13% residential penetration. Mobile ARPU improved, with churn down 900 bps YoY.
- **2025 Outlook**: Reaffirmed $3.4B EBITDA target, with Q4 expected to be first quarter of YoY growth, driven by ARPU management and cost savings.

**【CFO Financial Commentary】**
- **Financial Performance**: Q3 adjusted EBITDA of $831M (-3.6% YoY), with margin expansion to 39.4%. GAAP net loss included $1.6B noncash impairment of cable franchise rights. Full-year EBITDA guidance of $3.4B reflects moderation in residential video decline and cost control.
- **Cost Management**: Operating expenses improved 2.4% YoY, with OpEx on track for 4-6% reduction in 2026. Programming costs down 14% YoY, offsetting video revenue declines. Service call and truck roll rates improved 6% and 20% YoY, respectively.
- **Capital Allocation**: 2025 capex projected at $1.3B, with focus on Lightpath hyperscaler builds and HFC upgrades. Debt leverage at 7.8x, with $1B ABR facility supporting liquidity.

**【Q&A Highlights】**
- **Competitive Dynamics**: CEO emphasized disciplined approach to subscriber acquisition, avoiding aggressive promotions despite competitors' $500+ incentives. Q4 expected to see continued competitive intensity, with focus on scaling hyperlocal strategies.
- **Cost Structure**: CFO noted Q3 OpEx moderation (down $16M YoY) and 2026 target of 4-6% OpEx reduction. Marginal political ad revenue in Q4 may offset video declines.
- **MDU Strategy**: Expanded exclusive bulk agreements in multifamily buildings, targeting 2M+ homes passed. Mobile and value-added services (e.g., Total Care) positioned to offset video ARPU headwinds.
- **2027 Maturities**: Management declined to comment on debt refinancing plans, focusing on operational execution.


Altice USA, Inc. (ATUS) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

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Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

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Income Tax Adjustments

Net Income from Continuing Operations

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Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

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Other Comprehensive Income

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Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

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Diluted EPS

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OPTU

OPTU fundamentals

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