Just months after it pressed the accelerator on its planned fiber network buildout, Altice USA said it lost about 13,000 residential broadband customers in Q1, driving revenue down 2.3% to $2.42 billion in the period and cash flow down 7.7% to $991.7 million.
Altice lost about 3,000 broadband subscribers in 2021, as competition from Verizon and delays in its fiber rollout affected the business. In February, Altice USA said it would accelerate its fiber build-out plans, planning to pass about 6.5 million homes by 2025.
Altice said it is making progress on the fiber rollout, adding that it added 146,000 new fiber-to-the-home (FTTH) passings in Q1, bringing the total number of homes passed with FTTH to 1.3 million. The company said it plans to add another incremental 1.3 million FTTH passings in 2022.
The company also is moving forward with its edge-out program, extending its network to 42,000 additional homes in Q1 and to 273,000 total passings in the past 12 months.
While Q1 losses were higher than even the most skeptical analyst expected — most estimated growth would be flat to down by about 3,000 customers. In a conference call with analysts to discuss results, Altice USA CEO Dexter Goei said the performance was more due to lower gross additions and slower household move activity. While competition was somewhat of a factor in its Suddenlink territories in the Midwest, Goei said churn is stable in its eastern Optimum markets and its competitive stance with Verizon’s Fios product is improving on a quarter-over-quarter basis.
Still, Goei was reluctant to say that Altice will be able to turn around its broadband deficit this year.
“We definitely believe we are going to be growing subscribers in the second half of this year,” Goei said on the call. “I can’t tell you where the map will end up and whether we will be positive [for the full year] or not. But we’re clearly pushing to the positive and we’ve got some good momentum in terms of some of the initiatives we’ve been working on for the last six months.”
For instance, Altice said that it added about 11,000 fiber-to-the-home customers in the markets it has upgraded and plans to roll out a multi-Gig product in the second quarter, which should attract heavy data users — the company said the average speed taken by customers is 363 Megabits per second, and its broadband-only customers consume an average of 630 Gigabytes of data each month. Also, Goei was pleased with its mobile additions in the quarter — about 12,000 customers — coming after the company renegotiated its MVNO agreement with T-Mobile earlier this year. Those moves, coupled with its rebranding and improved customer experience campaigns, are anticipated to have a positive effect on growth. ▪️
