Shentel’s commercial fiber business sees momentum amidst one-time challenges

The service provider is enhancing its service reach to wireless carriers, mid-market and enterprise customers, wholesale partners, educational institutions, and state and local governments.

Sean Buckley

Nov. 6, 2025

4 min read

Key Highlights

Shentel’s fiber network now passes over 400,000 homes and businesses, with fiber route miles increasing significantly to support expansion.
Commercial fiber revenue grew by 14.1% over nine months, driven by new installations and customer demand for high-capacity bandwidth solutions.
The company plans to refinance its credit facilities to lower debt costs, improve financial flexibility, and pursue strategic acquisitions and expansion opportunities.
Shentel is leveraging rising demand for wavelengths and dark fiber connectivity to support AI and high-capacity applications, expanding into more business locations.
Future growth is supported by a focus on operational efficiencies, market expansion, and targeted M&A activities, including recent acquisitions like Horizon.

Shentel’s dedication to building out fiber is not just affecting consumers, as independent telco is seeing continued penetration with its growing base of business and wholesale customers.

Speaking to investors during its third quarter earnings call, Ed McKay, CEO of Shentel, said that it is making headway with all segments of its commercial base through selling its suite of Ethernet, dedicated internet access, wavelength, dark fiber leasing and managed services.

“We're seeing strong performance across a broad and diverse customer base, including wireless carriers, mid-market and enterprise customers, wholesale partners, educational institutions and state and local governments,” he said.

During the third quarter, Shentel reported commercial sales of almost $157,000 in incremental monthly revenue, up 19% over the prior year quarter. The service provider also kept average monthly compression and disconnect churn at bay at 0.4% in the third quarter.

Commercial Fiber revenue increased by $7.3 million, or 14.1%, in the nine months ended September 30, 2025, compared with the nine months ended September 30, 2024.

Like earlier periods, Shentel’s service delivery team installed $215,000 in new monthly revenue in the third quarter.

McKay said, “This followed record-setting sales in the first half of the year.”

Shentel's commercial fiber metrics for the third quarter.

Revenue challenges, opportunities

While Shentel continues to make progress with its commercial customers, it is not immune to revenue challenges.

During the quarter, the company reported that overall commercial fiber revenue declined slightly.

Shentel’s commercial fiber revenue declined $1.1 million, due to what the company said was $900,000 in noncash deferred revenue adjustments for one of its national wireless carrier customers and a $500,000 decline in early termination fees earned in 2024.

Jim Volk, CFO of Shentel, noted that “excluding these variances, commercial fiber revenue grew 2.3% over the same period in 2024.”

Despite the near-term revenue challenges, Shentel has positioned itself for future growth in the commercial segment.

Consider the fact that as of the end of the third quarter, its Glo Fiber division passed 400,000 homes and businesses in our greenfield expansion markets. Also, the service provider saw its total fiber route miles and fiber miles rise to 18,077 and 1,957,272, respectively.

Shentel’s commercial unit has the opportunity to continue to leverage its growing fiber base to attract more customers and deepen its relationships with existing ones.

Vertical Systems Group said in its 2024 U.S. Fiber Lit Buildings LEADERBOARD that “service providers cite rising customer demand for Wavelengths and custom Dark Fiber connectivity to support secure, dedicated ultra-high capacity bandwidth for AI and other applications that are driving fiber installations,” which are elements that Shentel will continue to expand as it grows its overall fiber reach into more business locations in its footprint.

New capital flexibility

As Shentel positions itself to reach positive free cash flow for the full year 2027, the telco plans to refinance its credit facilities through a hybrid structure, asset-backed securitization for its Glo Fiber and commercial fiber businesses, paired with a new credit facility for its incumbent broadband business.

McKay said this move will “lower our cost of debt, strengthen our credit profile, and increase financial flexibility.”

“These improvements will help us to capitalize on opportunities in a consolidating industry and deliver greater value to our investors,” he said. “We anticipate completing the refinancing in the coming months.”

To fulfill its commercial services growth strategy, the service provider will be able to pursue potential M&A targets and enhance how it operates its business.

For example, Shentel’s acquisition of Horizon bolstered its business service revenues. The service provider recognized $9.9 million of revenues earned in the acquired Horizon markets during the first three months of 2025.

“We think the refinancing we're working on gives us the flexibility to be a player there, and we're looking for opportunities to expand our footprint,” McKay said. “We're also looking to drive efficiencies in our business.”

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