Altice USA sees ARPU stability thanks to incremental services

To stay competitive, Altice is working to gain a clearer picture of customer needs, a picture that Mathew said the company didn’t have 12 to 24 months ago.

“Through the formation of our centralized data and analytics teams and implementation of AI tools, we now have a robust understanding of our customers and their individual customer lifetime values,” he said. “Overall, we remain well positioned with a healthy broadband customer base of 4.4 million customers, and we continue to see growth in fiber subscribers and mobile lines, which are key drivers of strong and profitable long-term customer relationships.”

Altice is focused on growing penetration in areas that have fiber through customer additions and a focus on migrations. The company expects to accelerate fiber migrations in the second half of the year.

“Approximately 60% of our fiber net adds were from migrations of existing customers,” said Sirota. “We mentioned there would be a bit of a slowdown in the pace of migrations this quarter as we continue to refine the operational process, and I’m pleased we expect to accelerate migrations in the back half of the year.”

Mobile line net additions were 33,000, more than double the pace of mobile additions year-over-year, and Altice increased penetration of its broadband base to 5.8%.

Total broadband subscriber net losses were $51,000 in the quarter, which Sirota attributed to seasonal university disconnects, competitive and macro pressures, and the end of ACP.

“The difference in Q2 broadband net add performance versus the prior year can mainly be attributed to pressure in our low-income segment,” he said. “Contributing to this is the sunset of ACP, which has temporarily impacted both gross adds and disconnects in this segment on a year-over-year basis.”

Sirota reported that, apart from the low-income segment, Altice has seen improved gross add activity year-over-year.

“Overall, as we continue to enhance our base management strategies, such as improved customer communication and speed rightsizing, we have the opportunity to deepen our customer relationships and maximize customer lifetime value (CLV) by retaining long-tenured customers and selling additional products.”

Mathew reported that Altice USA has upgraded over 700,000 qualified HFC customers to higher speeds since November, almost half of which were previously on legacy lower-speed plans.

“This initiative enables us to phase out speed tiers, deliver improved service experiences, and leave considerable room for future upgrades,” said Mathew. “And we have seen improved churn with our speed rightsized population as well as higher satisfaction.”

Raising fiber, HFC reach

Altice USA’s cash capital expenditures were $348 million, down 27% year-over-year.

The company added 62,000 additional fiber passings in the quarter and expects to end the year with around 3 million fiber passings. In addition, Sirota reported that Altice has expanded its total passing footprint by 67,000 in the quarter and expects to add over 175,000 total passing this year.

Sirota relayed that Altice’s HFC plant continues to perform well, and he said the company is maximizing its network quality in a capital-efficient manner.

“We are increasing broadband capacity for over 2.5 million customers by allocating bandwidth more efficiently to improve both upload and download speeds,” he said. “We continue to split nodes to create more capacity on our network, and we are doing this at a lower cost. We have strengthened our efforts around proactive and preventative network maintenance with enhanced processes and tools to identify in fixed network and equipment issues before a customer would ever notice.”