Cable One focuses on market-specific strategies and personalized products for future broadband revenue growth

Business broadband also continues to be an important driver of Cable One’s long-term growth strategy.

“Looking ahead to 2025, we are confident about the long-term growth of business data services,” said Laulis. “We expect to see strong continued growth in our Carrier, Enterprise, and Wholesale segments with continued focus on maximizing revenue growth in our SMB market as well.”

Laulis also reported that Cable One has substantially completed the rebranding of its recently acquired companies, like Fidelity and ValuNet, under the Sparklight brand, in addition to converting many customers to a unified billing system.

Competitive dynamics

Laulis reported that Cable One believes new competition from third-party overbuilders is moderating.

“While it is true that incumbent LECs continue to overbuild themselves with new fiber deployments in some of our markets, we’ve competed effectively against them for a long time and believe we will be able to do so going forward,” she said 

Cable One also believes that incumbent fiber builds may dissuade new parties from entering a given market.

Regarding the network itself, Laulis reported that reliability and capacity have become baseline expectations from customers, and Cable One is focusing on differentiation through customer experience. Laulis described a renewed focus on improving the in-home experience and growing an understanding of how the company’s services fit into its customers’ lives.

But that’s not to say Cable One isn’t focused on future network needs.

“We fully understand that data demands will likely have step function growth over time,” said Laulis. “Our future investments will focus on two areas to meet their needs: Expanding capacity to stay ahead of the demand curve and enhancing the intelligence of our network.”

Equity investments and long-term allocation strategy

CFO Todd Koetje reported that Cable One had revenues of $387.2 million in the fourth quarter, down 6% year over year, and that residential data revenues decreased by 5.4%, while business data revenues increased by 2.3% year-over-year.

“Residential data revenues were negatively impacted by the discontinuation of the affordable connectivity program,” said Koetje, “which resulted in a loss of approximately 10,000 existing primary service units (PSUs) through the end of Q3. In addition, we also experienced above-average churn activity amongst the remaining ACP customer cohort in the early part of Q4.”

Cable One had a net loss of $105.2 million in the fourth quarter, down 208% year over year, which Koetje reported was driven primarily by various noncash nonoperating charges associated with its MBI investment.

“First,” explained Koetje, “as in every quarter, we marked our MBI net option to market, which resulted in a noncash loss. Second, as a result of the previously announced amendment to our MBI partnership, we recognized a net gain associated with the new call and put options. And finally, as a result of our quarterly assessment for each of our equity investments, we identified an impairment of our MBI investment at year-end, which resulted in a noncash impairment. Collectively, these noncash items related to MBI resulted in a $169.4 million net reduction to earnings.”

Fourth quarter adjusted EBITDA was $211 million, down 7% year over year.

Capital expenditures were $71.9 million in the fourth quarter, which Koetje reported included $6.5 million of CapEx invested in new market expansion.

For the full year, Cable One had total revenues of $1.58 billion, down 5.9% from 2023. Residential data revenues declined 5.5%, and residential data PSUs decreased by 5,500, which includes approximately 10,000 ACP-related disconnects; barring these, PSUs increased by approximately 2,200.

2024 business data revenues increased 2.6%, which Koetje reported was partly driven by a gain of over 1,400 PSUs in the segment.

Cable One’s net income in 2024 was $14.5 million, down 93% from 2023. Adjusted EBITDA was $854 million, down 6.9% year over year. 2024 Capital expenditures were $286.4 million, which included $30.6 million towards new market expansion and $17.7 million for integration activities.

Koetje reported that significant investments already made in the network, specifically its DOCSIS 4.0 architecture, have resulted in a downward trend in capital expenditures that is expected to continue.

Koetje said that Cable One will continue to follow its four-pillar long-term allocation strategy, which involves:

• Enhancing network infrastructure.
• Pursuing organic growth opportunities.
• Evaluating strategic investments in accretive acquisitions.
• Returning capital as efficiently as possible, primarily through accelerated debt repayments and reduced leverage.