Frontier Communications Parent Inc (FYBR) 2023 Q3 法說會逐字稿

Good morning, thank you for attending today's Frontier Communications Third Quarter 2023 Earnings Call. My name is Megan, and I'll be your moderator for today's call. (Operator Instructions).

早安，感謝您參加今天的 Frontier Communications 2023 年第三季財報電話會議。我叫梅根，我將擔任今天電話會議的主持人。 （操作員說明）。

I would now like to pass the conference over to Spencer Kurn, Head of Investor Relations at Frontier. Mr. Kurn, you may proceed.

我現在想將會議交給 Frontier 投資者關係主管 Spencer Kurn。庫恩先生，您可以繼續了。

Good morning, and welcome to Frontier Communications Third Quarter 2023 Earnings Call. This is Spencer Kurn, Frontier's Head of Investor Relations. Joining me on the call today are Nick Jeffery, our President and CEO; and Scott Beasley, our CFO.

早安，歡迎參加 Frontier Communications 2023 年第三季財報電話會議。我是 Spencer Kurn，Frontier 投資人關係主管。今天和我一起參加電話會議的是我們的總裁兼執行長尼克傑弗瑞 (Nick Jeffery)；和我們的財務長 Scott Beasley。

Today's presentation can be followed within the webcast available in the Events & Presentations section of our Investor Relations website. Before we start, please see our safe harbor disclaimer on Slide 2. This is a reminder that this conference call may include forward-looking statements that involve risks and uncertainties that may cause actual results to differ materially from those expressed today. During the call, we may also refer to certain non-GAAP financial measures, which are defined and reconciled in our earnings presentation, press release and trending schedule.

您可以透過我們投資者關係網站的活動和演示部分的網路廣播觀看今天的演示。在我們開始之前，請參閱投影片2 上的安全港免責聲明。謹此提醒您，本次電話會議可能包含涉及風險和不確定性的前瞻性陳述，這些風險和不確定性可能導致實際結果與今天所表達的結果存在重大差異。在電話會議期間，我們也可能會參考某些非公認會計準則財務指標，這些指標在我們的收益報告、新聞稿和趨勢表中進行了定義和調整。

With that, I'll turn the call over to Nick.

這樣，我就把電話轉給尼克。

Thanks, Spencer, and good morning, everybody. As you saw in our press release this morning, we reported another strong quarter of operational results and delivered accelerated EBITDA growth. Before we go into details on the quarter, I want to highlight the progress we've made in executing our strategy over the last two years. At our Investor Day back in 2021, we outlined a clear plan to build a future-proof digital infrastructure company designed to meet the current and future needs of our customers. Our strategy is based on four value drivers; build fiber, sell fiber, improve customer service and increase operational efficiency. And if you turn to Slide 4, you can see that we're delivering on our plan, and we've done so even in a challenging macroeconomic environment.

謝謝，史賓塞，大家早安。正如您在今天早上的新聞稿中看到的那樣，我們報告了又一個強勁的季度營運業績，並實現了 EBITDA 的加速成長。在我們詳細介紹本季之前，我想強調一下我們在過去兩年中執行策略所取得的進展。在 2021 年的投資者日上，我們制定了一項明確的計劃，旨在打造一家面向未來的數位基礎設施公司，旨在滿足客戶當前和未來的需求。我們的策略基於四個價值驅動因素；建造光纖、銷售光纖、改善客戶服務並提高營運效率。如果您翻到投影片 4，您會發現我們正在實現我們的計劃，即使在充滿挑戰的宏觀經濟環境中我們也做到了這一點。

Let's start with our fiber build. Since we started in late 2020, we've expanded our fiber footprint by approximately 90%. We now provide 6.2 million homes and businesses access to our high-speed fiber network and we're more than halfway to our goal of 10 million fiber locations. On fiber penetration, we've grown our fiber broadband customer numbers by approximately 45% since 2020. In our base fiber footprint, we've now achieved penetration of 44%, just shy of our long-term target of 45% or better. And in markets where we're building fiber, our penetration rates are at or above our target ranges at the 1- and 2-year marks.

讓我們從光纖建置開始。自 2020 年底啟動以來，我們的光纖足跡已擴大了約 90%。現在，我們為 620 萬個家庭和企業提供高速光纖網路接入，距離 1,000 萬個光纖站點的目標已經完成一半以上。在光纖滲透率方面，自2020 年以來，我們的光纖寬頻客戶數量增加了約45%。在我們的基礎光纖覆蓋範圍中，我們目前的滲透率已達到44%，僅略低於45% 或更高的長期目標。在我們建造光纖的市場中，我們的滲透率達到或高於我們 1 年和 2 年的目標範圍。

And we're doing all of this whilst also growing ARPU, showing that our fiber offer is clearly attractive to our customers. We've also improved customer service. Over the last two years, we've created a culture where earning customer loyalty is a part of everyone's job. A weekly drumbeat of operational improvement enhanced by new digital channels means we are now better able than ever before to serve our customers. We can see the results of these improvements in our record Net Promoter Scores, reduced churn, reduced truck rolls and lower coal volume.

我們在做這一切的同時，也提高了 ARPU，這表明我們的光纖產品對我們的客戶來說顯然具有吸引力。我們也改善了客戶服務。在過去的兩年裡，我們創造了一種文化，讓贏得客戶忠誠度成為每個人工作的一部分。新的數位管道增強了每週的營運改進，這意味著我們現在比以往任何時候都更能為客戶提供服務。我們可以在創紀錄的淨推薦值、減少客戶流失、減少卡車運輸和減少煤炭用量等方面看到這些改進的結果。

And finally, on operational efficiency, we've dramatically simplified the way we work by eliminating unnecessary processes and systems, decreasing our real estate footprint and investing in new digital tools to make us more productive. We are on track to achieve $500 million in cost savings, double our initial target by the end of this year, and we're not done. We see potential additional savings in the future. This should create significant shareholder value as we execute on the key levers of our financial model.

最後，在營運效率方面，我們透過消除不必要的流程和系統、減少我們的房地產足跡以及投資新的數位工具來提高我們的工作效率，極大地簡化了我們的工作方式。我們預計在今年年底前實現 5 億美元的成本節約，是我們最初目標的兩倍，而且我們還沒有完成。我們看到未來潛在的額外節省。當我們執行財務模型的關鍵槓桿時，這應該會創造顯著的股東價值。

It all starts with revenue growth. We offer customers a superior technology at a compelling price, and we do this in a highly attractive market structure with only 1 or 0 gigabit capable competitors in 86% of our footprint. And these market dynamics support revenue growth as we increase the number of fiber customers and increase ARPU. At the same time, we're actively managing structural revenue declines in our legacy copper and voice products. And together, we expect to see sustained revenue growth as fiber becomes a greater and greater percentage of our overall mix.

這一切都始於營收成長。我們以極具吸引力的價格為客戶提供卓越的技術，並且我們在極具吸引力的市場結構中做到這一點，在我們 86% 的市場中只有 1 或 0 千兆位元能力的競爭對手。隨著我們光纖客戶數量的增加和 ARPU 的增加，這些市場動態支持收入成長。同時，我們正積極應對傳統銅纜和語音產品的結構性收入下降。隨著光纖在我們整體產品組合中所佔的比例越來越大，我們預期收入將持續成長。

The next driver of returns is increasing margins. We are constantly identifying ways to work smarter and our targeted investments in technology, specifically in the areas of digital and automation should drive sustainable long-term savings. Also, as we grow revenue and increased scale, we should benefit from favorable unit economics. Fiber is an inherently more efficient technology and delivers tomorrow's capacity needs at a fundamentally lower cost and legacy network. The strong unit economics of our model combined with fiber's inherent scalability should lead to material margin expansion.

回報的下一個驅動因素是利潤率的提高。我們不斷尋找更聰明的工作方式，我們對科技的有針對性的投資，特別是在數位和自動化領域，應該能夠推動可持續的長期節省。此外，隨著我們收入的成長和規模的擴大，我們應該受益於有利的單位經濟效益。光纖本質上是一種更有效率的技術，能夠以從根本上降低的成本和傳統網路滿足未來的容量需求。我們模型的強大單位經濟效益與光纖固有的可擴展性相結合，應該會導致材料利潤率的擴大。

Next, let's talk about capital. I'm pleased to say that we're in a very strong position when it comes to liquidity. Thanks to the securitization transaction we executed earlier this year, we have a clear pathway to fully fund our build to 10 million locations. While the current interest rate backdrop is clearly a challenge, we've proven we can navigate it well. We have high confidence in our ability to deliver IRRs in the mid to high teens, well above our cost of capital.

接下來我們來談談資本。我很高興地說，我們在流動性方面處於非常有利的地位。由於我們今年稍早執行的證券化交易，我們有了明確的途徑來為我們建造 1000 萬個網點提供全額資金。雖然目前的利率背景顯然是一個挑戰，但我們已經證明我們可以很好地應對。我們對實現中高十幾位數的內部報酬率（遠高於我們的資本成本）的能力充滿信心。

Ultimately, value is derived from EBITDA growth and cash flow generation. As our revenue mix expands towards more fiber, we should show accelerating EBITDA growth. And to give you a glimpse of what we're driving towards, I'd like to revisit our steady-state model. At a fiber build of 10 million homes passed and targeted penetration of 45%, we expect to generate EBITDA of approximately $4 billion.

最終，價值源自 EBITDA 成長和現金流生成。隨著我們的收入組合向更多纖維擴展，我們應該顯示 EBITDA 的加速成長。為了讓您了解我們的目標，我想重新審視我們的穩態模型。如果光纖建設覆蓋 1,000 萬戶家庭，目標滲透率達到 45%，我們預計將產生約 40 億美元的 EBITDA。

Now after subtracting maintenance and customer connection CapEx of approximately $1 billion, we should, therefore, yield recurring cash flows of approximately $3 billion. As we reach this steady state, we should be able to generate the cash flow to both reduce leverage and return cash back to investors. And given the inherent superiority of fiber, we should be able to generate attractive returns for decades.

現在，在減去約 10 億美元的維護和客戶連接資本支出後，我們應該產生約 30 億美元的經常性現金流。當我們達到這種穩定狀態時，我們應該能夠產生現金流以降低槓桿並將現金回饋給投資者。鑑於纖維固有的優越性，我們應該能夠在幾十年內產生有吸引力的回報。

Now let's turn to Slide 6 to review how our third quarter results illustrate our progress. This quarter saw our strong operational performance deliver accelerated EBITDA growth. We delivered EBITDA growth of 4%, our fastest quarter of growth in more than 6 years. We expect another quarter of solid EBITDA growth in Q4.

現在讓我們轉向投影片 6，回顧一下我們的第三季業績如何說明我們的進展。本季我們強勁的營運業績帶來了 EBITDA 的加速成長。我們的 EBITDA 成長了 4%，這是 6 年多來最快的季度成長。我們預計第四季度 EBITDA 也將實現強勁成長。

I also want to call out the positive trends in our customer growth this quarter. Broadband net adds were up 20%, both sequentially and year-over-year, and Consumer ARPU growth turned positive for the first quarter in more than a year. This is the direct result of the targeted changes we made earlier this year to bring our ARPU more in line with the market. These trends powered positive overall Consumer revenue growth for our first time as a new public company, and we expect this growth to accelerate next quarter.

我還想指出本季我們客戶成長的正面趨勢。寬頻淨增加量較上季及年比均成長 20%，一年多來第一季消費者 ARPU 成長轉正。這是我們今年稍早進行的有針對性的改變的直接結果，以使我們的 ARPU 更加符合市場。這些趨勢推動了我們作為一家新上市公司首次實現整體消費者收入的積極成長，我們預計這一增長將在下個季度加速。

In conclusion, I'm pleased with the progress we've made in transforming Frontier into a fiber broadband leader, and I'm excited about the tremendous opportunity ahead of us. Before I turn the call over to Scott, I want to say a huge thank you to all of our team. I appreciate the hard work it takes to drive our transformation and advance our purpose of building Gigabit America.

總之，我對我們在將 Frontier 轉變為光纖寬頻領導者方面所取得的進展感到高興，並且對我們面前的巨大機會感到興奮。在將電話轉給斯科特之前，我想對我們所有團隊表示衷心的感謝。我很欣賞為推動我們的轉型和推進我們建設千兆美國的目標而付出的辛勤工作。

So thank you all. Scott, now over to you.

謝謝大家。史考特，現在輪到你了。

Thank you, Nick, and good morning, everyone. I'll start with the financial highlights of our third quarter. Revenue was $1.44 billion. Strong fiber revenue growth of 10% was offset by legacy copper declines. We had $11 million of net income, and we earned $526 million of adjusted EBITDA, up 4% year-over-year due to strong fiber growth. $328 million of our adjusted EBITDA came from fiber products, which grew 19% year-over-year.

謝謝你，尼克，大家早安。我將從第三季的財務亮點開始。收入為 14.4 億美元。光纖收入 10% 的強勁成長被傳統銅纜收入下降所抵消。由於纖維的強勁成長，我們的淨利潤為 1,100 萬美元，調整後 EBITDA 為 5.26 億美元，較去年同期成長 4%。我們調整後的 EBITDA 中有 3.28 億美元來自纖維產品，較去年同期成長 19%。

Additionally, we generated $383 million of net cash from operations, bringing our cash from operations to $1.4 billion over the trailing 12 months. Our healthy cash flow before CapEx demonstrates the underlying cash generation profile of our business.

此外，我們還從營運中產生了 3.83 億美元的淨現金，使過去 12 個月的營運現金達到 14 億美元。我們在資本支出之前的健康現金流顯示了我們業務的基本現金產生狀況。

Slide 9 highlights the strength of our fiber customer growth across base and expansion markets. The chart on the left shows that our broadband customer base grew 19% over the last 12 months, and has grown 45% since we started building fiber in late 2020. This is an encouraging trend for two reasons. First, we achieved this solid customer growth while simultaneously growing ARPU. Second, we have grown our fiber customer base in an environment where household moves have been low. And our base fiber footprint of 3.2 million locations, our penetration increased 100 basis points to 43.9%.

投影片 9 強調了我們在基礎市場和擴展市場中光纖客戶成長的實力。左圖顯示，我們的寬頻客戶群在過去 12 個月中成長了 19%，自 2020 年底開始建造光纖以來，成長了 45%。這是一個令人鼓舞的趨勢，原因有二。首先，我們實現了客戶的穩健成長，同時 ARPU 也不斷成長。其次，我們在家庭搬遷率較低的環境中擴大了光纖客戶群。我們的基礎光纖足跡覆蓋 320 萬個地點，滲透率提高了 100 個基點，達到 43.9%。

This is just shy of our terminal penetration target of 45% and serves as an indicator of where we can drive penetration in our expansion footprint. The chart on the right maps the penetration curves of each expansion cohort. As you can see, they are all performing at or above our target ranges at the 12- and 24-month marks.

這僅略低於我們 45% 的終端滲透率目標，並且可以作為我們在擴張足跡中推動滲透率的指標。右圖描繪了每個擴張隊列的滲透曲線。正如您所看到的，它們在 12 個月和 24 個月時的表現都達到或高於我們的目標範圍。

Moving to Slide 10. Fiber revenue growth accelerated to 10%, driven by healthy Consumer performance. Excluding our legacy video product, Consumer fiber revenue grew 20% this quarter. Overall, Consumer fiber revenue grew 13%. Our fiber revenue growth offset copper declines. And as Nick shared, overall Consumer revenue grew for the first time since we became a new public company.

轉向幻燈片 10。在健康的消費者表現的推動下，光纖收入成長加速至 10%。不包括我們的傳統視訊產品，消費光纖收入本季成長了 20%。總體而言，消費纖維收入成長了 13%。我們的光纖收入成長抵消了銅的下降。正如尼克分享的那樣，自我們成為一家新的上市公司以來，消費者整體收入首次成長。

Business and Wholesale fiber revenue was up 5% year-over-year. In Q4, we expect total Business and Wholesale to be down slightly sequentially as fiber revenue remains roughly flat and legacy products declined. Our strong fiber growth drove an acceleration in adjusted EBITDA this quarter.

商業和批發纖維收入年增 5%。第四季度，我們預期業務和批發總額將較上季略有下降，因為光纖收入大致持平且傳統產品下降。我們強勁的纖維成長推動了本季調整後 EBITDA 的加速。

If we turn to Slide 11, we you can see that we grew EBITDA by 4%. This was driven by fiber revenue growth, effective cost reduction and actively managing copper declines. We expect these trends to continue in Q4. Let's turn next to capital expenditures on Slide 12. We are on track to meet our guidance of full year CapEx in the $3.0 billion to $3.2 billion range. We previously shared that CapEx would decline in the second half of the year as we would begin consuming prework and using the inventory that we purchased earlier in the year.

如果我們翻到投影片 11，您可以看到我們的 EBITDA 成長了 4%。這是由光纖收入成長、有效降低成本和積極管理銅價下降所推動的。我們預計這些趨勢將在第四季度繼續下去。接下來讓我們討論幻燈片 12 上的資本支出。我們預計將實現 30 億至 32 億美元範圍內的全年資本支出指引。我們之前曾表示，下半年資本支出將下降，因為我們將開始消耗前期工作並使用今年稍早購買的庫存。

We also expected to have a lower cost build mix. That's exactly what we saw in the third quarter, and we expect more of the same in Q4. As I said last quarter, we expect 2023 to be our peak CapEx year. We'll now turn to liquidity on Slide 13. At the end of the third quarter, we had approximately $3.4 billion of liquidity, including $2.1 billion raised through our fiber securitization in August.

我們也期望擁有更低成本的建造組合。這正是我們在第三季看到的情況，我們預計第四季會出現更多相同情況。正如我上季度所說，我們預計 2023 年將是我們的資本支出高峰年。現在我們將討論投影片 13 上的流動性。第三季末，我們擁有約 34 億美元的流動性，其中包括 8 月透過光纖證券化籌集的 21 億美元。

This transaction was a significant milestone for Frontier as it provided a clear path to fully fund our fiber build and refinance traditional debt over time. Additionally, the deal highlighted the value of our mature fiber assets, and it attracted a new pool of investment-grade long-term investors. In addition to our strong liquidity and access to capital, our balance sheet remains healthy. Approximately 87% of our debt is at fixed rates, and we do not have any significant maturities until 2027.

這項交易對於 Frontier 來說是一個重要的里程碑，因為它提供了一條清晰的途徑，為我們的光纖建設提供充分資金，並隨著時間的推移為傳統債務再融資。此外，這筆交易凸顯了我們成熟纖維資產的價值，並吸引了一群新的投資等級長期投資者。除了我們強大的流動性和資本獲取管道之外，我們的資產負債表也保持健康。我們大約 87% 的債務是固定利率的，而且我們在 2027 年之前沒有任何重大到期債務。

Finally, you can see on Slide 14 that our 2023 guidance remains unchanged. We continue to expect adjusted EBITDA in the $2.11 billion to $2.16 billion range. We expect to pass 1.3 million additional locations this year and expect cash capital expenditures of approximately $3.0 billion to $3.2 billion.

最後，您可以在投影片 14 上看到我們的 2023 年指引保持不變。我們仍預期調整後 EBITDA 在 21.1 億美元至 21.6 億美元範圍內。我們預計今年將新增 130 萬家門市，現金資本支出約 30 億至 32 億美元。

I'll close by saying thank you to our team for another solid quarter. I'm personally proud of the work that we are doing to build Gigabit America and deliver connectivity to millions of consumers and businesses across the country.

最後，我要感謝我們的團隊又一個堅實的季度。我個人對我們為建立「千兆美國」並為全國數百萬消費者和企業提供連接所做的工作感到自豪。

Now I'll turn the call back over to Nick.

現在我將把電話轉回給尼克。

Thanks, Scott. I know many of you have seen the reports of Jana's recent presentation. We're not going to take any questions specific to that topic on today's call. We've always engaged in open and regular communications with all of our shareholders, and we will continue to do so. Our Board of Directors and management team are focused on driving long-term value for our shareholders, employees and customers, and continue to take actions that enable us to deliver on this objective.

謝謝，斯科特。我知道你們很多人都看過賈娜最近演講的報道。我們不會在今天的電話會議上回答任何針對該主題的問題。我們始終與所有股東進行公開、定期的溝通，並將繼續這樣做。我們的董事會和管理團隊致力於為股東、員工和客戶創造長期價值，並繼續採取行動，使我們能夠實現這一目標。

Before we open it up for questions, I'm pleased to announce that we plan to host an investor update in early 2024 where we will provide additional detail on our longer-term financial model and expectations for driving shareholder value.

在我們開始提問之前，我很高興地宣布，我們計劃在 2024 年初舉辦投資者更新會，屆時我們將提供有關我們的長期財務模型和推動股東價值的預期的更多詳細資訊。

Now we'd like to open the call up to your questions. Thank you.

現在我們想開始電話會議，回答您的問題。謝謝。

(Operator Instructions) Our first question will go to the line of Brett Feldman with Goldman Sachs.

（操作員說明）我們的第一個問題將涉及布雷特·費爾德曼 (Brett Feldman) 與高盛 (Goldman Sachs) 的聯絡線。

And two, if you don't mind. Nick, when you would come to Communacopia a couple of weeks ago, you had mentioned how the market conditions were clearly having some impact on the pacing of your subscriber growth, I think you were referring the way seasonality has become a little more muted and household moves are down, and Scott had referred to that as well. And obviously, it's good to see that you're still tracing towards your penetration targets despite that.

如果你不介意的話，還有兩個。尼克，當您幾週前來到 Communacopia 時，您曾提到市場狀況顯然對您的訂戶增長速度產生了一些影響，我認為您指的是季節性變得更加溫和和家庭化的方式走勢下降，斯科特也提到了這一點。顯然，儘管如此，很高興看到您仍在朝著滲透目標前進。

But I'm curious, can you give us a little bit more insight into how meaningful you think those dynamics are to your growth, maybe some of the ways you've recalibrated in that environment? And is it getting to the point where the market has changed enough that you might be recalibrating the balance of passing that you'd want to have over the next year or so versus maybe be more focused on simply driving penetration of what you have? That's the first question.

但我很好奇，你能否讓我們更深入地了解你認為這些動態對你的成長有多大意義，也許是你在那種環境中重新調整的一些方式？市場是否已經發生了足夠大的變化，以至於你可能會重新調整你希望在未來一年左右擁有的傳遞的平衡，而不是更專注於簡單地推動你所擁有的產品的滲透？這是第一個問題。

The second is on the commentary you gave about business in wireline being down a little bit sequentially in the fourth quarter. So maybe you can just give us a broader update on how to think about the outlook for that segment in the current market conditions and whether you think that's going to be something that could drift a bit lower in the near term or whether you see a clear path back to sustained growth?

第二個是關於您對第四季度固網業務環比略有下降的評論。因此，也許您可以向我們提供更廣泛的最新信息，說明如何在當前市場條件下考慮該細分市場的前景，以及您是否認為短期內該細分市場可能會稍微走低，或者您是否看到了明確的趨勢。回歸持續成長之路？

Brett, thanks. On your question about market conditions is a good one because just like every other business, we're not immune from those things. But I think what we have done with some degree of success, is really focused on our core strategy of building fiber, selling fiber, improving care and becoming more efficient. And as that kind of translates into revenue growth, I think we see the strategies around ARPU development, penetration and so on, just progressing quarter-over-quarter in a very logical way. That doesn't mean in any way that we're immune from the wider market dynamics, which affect us just as much. But if I look at how that strategy is flowing through, Consumer fiber broadband grew 22% year-over-year with double-digit growth in Consumer and ARPU up 2%. And our total fiber revenue is also up 10%.

布雷特，謝謝。關於你關於市場狀況的問題是一個很好的問題，因為就像其他企業一樣，我們也不能倖免於這些事情。但我認為我們取得了一定程度的成功，真正專注於我們的核心策略：製造纖維、銷售纖維、改善護理和提高效率。隨著這種轉化為收入成長，我認為我們看到了圍繞 ARPU 開發、滲透率等的策略，以非常合乎邏輯的方式逐季取得進展。這並不意味著我們可以免受更廣泛的市場動態的影響，而市場動態對我們的影響同樣大。但如果我看看這項策略的實施情況，就會發現消費者光纖寬頻年增了 22%，其中消費者成長了兩位數，ARPU 成長了 2%。我們的光纖總收入也成長了 10%。

So whilst those things are naturally offset by copper declines, (inaudible) factors like move activity and so on. I think the power of our expanding fiber footprint, very, very clear pricing strategy to grow customers up the gig-plus kind of pricing ladder we've talked about before to sell more value added services, to drive penetration throughout continued refinement and go-to-market strategies and as we open up new territories, new sectors and so on, is in a sense, countervailing the cyclical pressures that we see. So it's a question of the kind of growth engine that we're building offset by any quarterly cyclical headwinds that we face. And the net of those 2 things is transitioning very well into the kind of overall growth that we're seeing.

因此，雖然這些因素自然會被銅價下跌所抵消，但（聽不清楚）因素如移動活動等。我認為，我們不斷擴大的光纖足跡、非常非常明確的定價策略的力量，可以讓客戶上升到我們之前討論過的零工+定價階梯，以銷售更多的增值服務，透過持續的完善和發展來推動滲透——市場策略以及我們開拓新領域、新產業等，從某種意義上來說，抵消了我們所看到的周期性壓力。因此，問題在於我們正在建立什麼樣的成長引擎來抵消我們面臨的任何季度週期性逆風。這兩件事的結合正在很好地轉變為我們所看到的整體成長。

Now on Business and Wholesale. Just as with every other company, Business and Wholesale is slightly lumpy quarter-to-quarter. And we have a little bit more copper kind of headwinds in that business than in other parts of the business. But that said, it's -- we've got a very good team that's continuing to refine and improve that business. We're on track to achieve kind of stable total Business and Wholesale revenues for the full year in 2023. And again, if we take a step back and look at the fiber revenue, that sector is growing. We saw 5% growth in our Business and Wholesale fiber revenues, which really shows the potential of that segment as we continue to expand our fiber footprint and continue to kind of refine our go-to-market strategies there.

現在從事商業和批發業務。與其他公司一樣，商業和批發業務季度與季度之間略有波動。與該業務的其他部分相比，我們在該業務中遇到的銅類阻力要多一些。但話雖如此，我們擁有一支非常優秀的團隊，正在繼續改進和改進該業務。我們預計在 2023 年全年實現穩定的業務和批發總收入。同樣，如果我們退後一步看看光纖收入，就會發現該行業正在成長。我們的業務和批發纖維收入成長了 5%，這確實顯示了該領域的潛力，因為我們繼續擴大我們的纖維足跡並繼續完善我們的市場策略。

And across all 3 business units in SMB, Enterprise and Wholesale, we're seeing a really sharp increase in order volumes and a much more favorable sales mix, which overall leads to higher pricing. So again, whilst we're exposed to declines in legacy copper services whilst we, of course, face the kind of changes in headwinds quarter-to-quarter, just like in our whole business, Business and Wholesale gets structurally stronger every quarter as we build fiber, refine our go-to-market activities, keep focused on our pricing strategy of moving people up the ladder, selling more value-added services and the business goes from strength to strength quarter-over-quarter.

在中小企業、企業和批發的所有 3 個業務部門中，我們看到訂單量急劇增加，銷售組合更加有利，這總體上導致了更高的定價。因此，儘管我們面臨著傳統銅服務下降的風險，但我們當然也面臨著每季逆風的變化，就像我們的整個業務一樣，隨著我們的發展，業務和批發業務每個季度都會在結構上變得更強。建立光纖，完善我們的行銷活動，繼續專注於我們的定價策略，以提升人們的地位，銷售更多增值服務，業務逐季度不斷增強。

Our next question comes from the line of Jonathan Chaplin with New Street.

我們的下一個問題來自喬納森·卓別林與新街的台詞。

A couple for Scott, actually. Scott, you didn't narrow the range on EBITDA guidance for the year, which means you've got sort of a big range for the fourth quarter. Should we still be focused on the middle of that range, which would suggest really solid mid-single-digit growth for the fourth quarter?

實際上是斯科特的一對。斯科特，您沒有縮小今年 EBITDA 指導範圍，這意味著第四季度的範圍較大。我們是否應該繼續關注該範圍的中間位置，這表明第四季度將出現真正穩健的中個位數成長？

And then it seems like in the copper business, EBITDA did sort of many well recent -- relative to recent trends, is that mostly a function of the cost-cutting that Nick mentioned during his comments? Or is there anything else going in there? And then I think you said during your comments that the drop in subsidy revenue is just a matter of timing, we should collect that in the fourth quarter. I just wanted to confirm that as well.

然後，似乎在銅業務中，EBITDA 最近表現良好——相對於最近的趨勢，這主要是尼克在評論中提到的成本削減的結果嗎？還是裡面還有別的東西？然後我想你在評論中說過，補貼收入的下降只是時間問題，我們應該在第四季收集。我也只是想確認一下。

Sure, Jonathan. Let me take each of those in turn. So on EBITDA, few points that we've given on EBITDA that I'll reiterate today. We expect sequential growth in Q4 from where we were in Q3 and then looking at year-over-year growth, we expect that to be in the low to mid-single-digit growth from last year's fourth quarter. So we have inflected in EBITDA. We grew EBITDA in the first half. We grew EBITDA by 4% in the third quarter, we expect full year EBITDA growth this year. So the EBITDA inflection story is a really big milestone for us, so that's fourth quarter EBITDA.

當然，喬納森。讓我依序討論其中的每一個。關於 EBITDA，我們今天將重申我們就 EBITDA 給出的幾點觀點。我們預計第四季度將比第三季度實現環比增長，然後考慮同比增長，我們預計第四季度將比去年第四季度低至中個位數增長。所以我們已經改變了 EBITDA。上半年我們的 EBITDA 有所成長。我們第三季的 EBITDA 成長了 4%，我們預計今年全年 EBITDA 將會成長。因此，EBITDA 的拐點故事對我們來說是一個非常重要的里程碑，這就是第四季度的 EBITDA。

On the second question of copper, you're right. Our customer losses have been relatively stable in copper in the kind of low to mid $60,000 per quarter, but our EBITDA trajectory has improved because of that cost cutting. We're almost to the $500 million of cost-cutting about a year earlier than we expected. And so that's driven the improvement in our copper EBITDA and our overall EBITDA for the company.

關於銅的第二個問題，你是對的。我們的銅客戶損失相對穩定，每季低至中 60,000 美元，但由於成本削減，我們的 EBITDA 軌跡有所改善。我們幾乎比預期提前一年削減了 5 億美元的成本。因此，這推動了我們銅 EBITDA 和公司整體 EBITDA 的改善。

And then the third question was subsidy. Yes, that's just a question of timing. Subsidy is very lumpy quarter-to-quarter depending on when you get in cash from different municipalities. So no change to our overall subsidy view for this year. Perhaps some of Q4 could transition into Q1 of next year, but our subsidy road map is very much intact.

第三個問題是補貼。是的，這只是時間問題。每個季度的補貼都非常不穩定，具體取決於您從不同城市獲得現金的時間。因此，我們今年的整體補貼觀點並沒有改變。也許第四季度的一些內容可能會過渡到明年第一季度，但我們的補貼路線圖非常完整。

Our next question comes from the line of Greg Williams with TD Cowen.

我們的下一個問題來自 Greg Williams 和 TD Cowen 的對話。

First one is just on CapEx. It does imply that CapEx will come down to the [$350] million levels here. Can you help us with the cadence of next year? Will we see that huge bump up like we saw last year in the first half of the year? Or will it be more muted?

第一個只是資本支出。這確實意味著資本支出將降至 [3.5 億美元] 水準。你能幫我們確定明年的節奏嗎？今年上半年我們會看到像去年那樣的巨大成長嗎？還是會更低調？

And then second question around CapEx is helping us get comfortable. You noted that 2023 will be that peak CapEx year to 2024 and churn would be little bit lower. But you also noted that this year, you had a higher mix of lower cost per build homes, like the lower-hanging fruit is being built. So as we -- next year, you'll have a higher mix of higher cost builds, yet you'll see lower CapEx and so just help us reconcile that and get comfortable there?

關於資本支出的第二個問題是幫助我們感到舒適。您指出，2023 年將是 2024 年之前的資本支出高峰年，客戶流失率會稍微低一些。但您也指出，今年，每棟房屋的建造成本較低，例如正在建造的容易實現的目標。因此，明年，您將擁有更高成本構建的更高組合，但您會看到更低的資本支出，因此只需幫助我們協調這一點並在那裡感到舒適？

Sure, Greg. Let me take each of those. So on CapEx for the fourth quarter into next year, let me give you a few data points there. So as we expected, we saw a significant decline in second half CapEx. We saw a nice step-down in CapEx this quarter, which was driven by 3 items. We consumed prework that was completed in prior quarters, we consumed inventory, and then we benefited from lower cost builds, and we expect each of those trends to continue into Q4. And additionally, we expect benefits from normalizing payment terms with suppliers. So that's Q4.

當然，格雷格。讓我把其中的每一個都拿走。因此，關於明年第四季的資本支出，讓我給您一些數據點。因此，正如我們所預期的那樣，我們看到下半年資本支出大幅下降。我們看到本季資本支出大幅下降，這是由 3 個項目推動的。我們消耗了前幾季完成的預製工作，消耗了庫存，然後我們從較低的成本建構中受益，我們預計這些趨勢將持續到第四季。此外，我們預期與供應商的付款條件正常化會帶來好處。這就是第四季。

And the part of your question on next year, a few broad data points to give you. So we expect roughly 1.3 million passings. We expect CapEx to be below this year. And then we do expect it to be front-end loaded, similar to this year, just given the cadence of the build. So that's the road map on CapEx for the next 5 quarters.

關於明年問題的部分，我們向您提供一些廣泛的數據點。因此我們預計大約有 130 萬次通過。我們預計今年的資本支出將低於這一水平。然後我們確實希望它是前端加載的，與今年類似，只是考慮到構建的節奏。這就是未來 5 季的資本支出路線圖。

And then the final part of your question on build CapEx for next year. The trends that I mentioned for Q4 will continue into next year. So we will continue consuming prework. We'll continue consuming inventory. And if you think about it, we do have a large backlog of work that we've done in engineering, design, central offices, middle mile that lowers the cash CapEx in future quarters. And so that will help benefit our CapEx number next year.

然後是關於明年建設資本支出的問題的最後一部分。我提到的第四季的趨勢將持續到明年。所以我們會繼續消耗前期工作。我們將繼續消耗庫存。如果你想一想，我們確實在工程、設計、中央辦公室、中間里程方面積壓了大量工作，這降低了未來幾季的現金資本支出。因此，這將有助於我們明年的資本支出數字。

Our next question comes from the line of Nick Del Deo with MoffettNathanson.

我們的下一個問題來自 Nick Del Deo 和 MoffettNathanson 的對話。

You had very solid subscriber performance in the base markets in the quarter, which I guess implies somewhat softer contributions from the expansion markets. I guess, can you talk about that a little bit? And kind of more generally what you see with respect to churn and ARPU trends in some of your more seasoned expansion markets versus your base markets?

本季基礎市場的用戶表現非常穩定，我想這意味著擴張市場的貢獻減弱。我想，你能談談這個嗎？更一般地說，您在一些經驗更豐富的擴張市場與基礎市場中的客戶流失率和 ARPU 趨勢方面看到了什麼？

And then on the commercial front, it sounds like there might be somewhat different headwinds in that business as of late. But Nick, you noted kind of flat revenue year-over-year, '23 versus '22. I guess as we look out over the coming years, would you expect commercial revenue to kind of remain flattish or do you think the tailwind you talked about can overcome some of those headwinds and get you positive growth?

然後在商業方面，聽起來該行業最近可能存在一些不同的阻力。但是尼克，你注意到「23 年與 22 年」的收入同比持平。我想，當我們展望未來幾年時，您是否預期商業收入將保持平穩，或者您認為您所說的順風可以克服其中一些不利因素並為您帶來正成長？

Yes, sure. Let me take the first one and then pass to Nick for the Business and Wholesale question. So on the question about net add performance, let me break it into two parts, base and expansion. In base, we had another strong quarter of penetration gains. We finished at roughly 44%, which is up from 41% a few years ago and is very close to our terminal penetration of 45%. So we feel really good about the trajectory in our base.

是的，當然。讓我回答第一個問題，然後將業務和批發問題轉給尼克。那麼關於net add效能的問題，讓我把它分成兩個部分，基礎和擴充。在基礎方面，我們又一個季度的滲透率成長強勁。我們的終端滲透率約為 44%，高於幾年前的 41%，非常接近我們 45% 的終端滲透率。所以我們對基地的發展軌跡感覺非常好。

And we also feel good about the trajectory in expansion. We continue to be at or above our penetration targets at 12 and 24 months. And if you see in our slides today, we're within that 15% to 20% range of 12 months and 25% to 30% at 24 months. So with those big picture data points in mind, every quarterly build cohort is going to be different. You have new geographies, different location types that have different sales cycles and penetration time lines.

我們也對擴張的軌跡感到滿意。我們繼續達到或超過 12 個月和 24 個月的滲透率目標。如果您在今天的幻燈片中看到，我們在 12 個月內處於 15% 至 20% 的範圍內，在 24 個月內處於 25% 至 30% 的範圍內。因此，考慮到這些大數據點，每季的建置佇列都會有所不同。您擁有新的地理位置、不同的位置類型，這些位置類型具有不同的銷售週期和滲透時間軸。

For example, a multi-dwelling unit may take longer to sell into in the first several months, but you're going to get to the same point at 12 and 24 months or at a new state where we don't have deeper brand awareness, it might take a few more months to build that brand awareness, but you get to the same point by 12 and 24 months. And that's really why we give annual penetration targets externally, not quarterly or monthly. So when we take a step back, we're very pleased with the net add performance in the quarter. We see it increasing in Q4, increasing into 2024 and feel good about the path we're on.

例如，多住宅單元在前幾個月可能需要更長的時間才能出售，但在 12 個月和 24 個月或在我們沒有更深層次品牌知名度的新狀態下，您將達到相同的水平，可能還需要幾個月的時間才能建立品牌知名度，但12 個月和24 個月就能達到相同的水平。這就是為什麼我們在外部給出年度滲透率目標，而不是季度或月度目標。因此，當我們退後一步時，我們對本季的淨成長表現感到非常滿意。我們看到它在第四季度有所增加，並持續到 2024 年，並對我們所走的道路感到滿意。

Yes. And I'll take the Business and Wholesale question. I mean, just taking a little bit of a step back, as I think I've said on previous calls, our Enterprise business, in particular, is perhaps not like the Enterprise businesses of some of our peers when we kind of analyze it. I mean, in 3 main ways.

是的。我將回答商業和批發問題。我的意思是，退一步來說，正如我在之前的電話會議中所說的那樣，當我們進行分析時，我們的企業業務可能與我們一些同行的企業業務不同。我的意思是，主要有三個面向。

The first of which is we don't really have any large enterprise customers. So what we call enterprise is typically medium and below in terms of how other people would describe it. So we've got a really small kind of enterprise base compared to others. That means that those customers have a much higher propensity to buy the core product that we are building and selling, so high-speed symmetrical fiber. So therefore, we've got a very different market topography than some of our peers.

首先，我們其實沒有任何大型企業客戶。因此，就其他人的描述而言，我們所說的企業通常處於中等或以下水平。因此，與其他公司相比，我們的企業基礎非常小。這意味著這些客戶更有可能購買我們正在製造和銷售的核心產品，即高速對稱光纖。因此，我們的市場格局與一些同業截然不同。

Second thing is we are a very small part of the market. So the overall market dynamics don't really affect us so much. And that's particularly true when you realize that, that business in the past was perhaps not as well run as it could have been. So I'm really, really pleased with the work that the new leadership teams have put in place there. You can see that flowing through in strong order books. You can see it flowing through in the 5% growth we saw in Business and Wholesale fiber. And of course, that just keeps accelerating as we build more fiber path more of these businesses and drive up penetration.

第二件事是我們只佔市場很小的一部分。因此，整體市場動態並沒有對我們造成太大影響。當您意識到過去的業務運作可能不如預期時，情況尤其如此。因此，我對新領導團隊在那裡所做的工作感到非常非常滿意。你可以在強勁的訂單簿中看到這一點。您可以從我們在商業和批發纖維領域看到的 5% 的成長中看到它的流動。當然，隨著我們為更多此類業務建立更多光纖路徑並提高滲透率，這種情況會不斷加速。

Now it is also true that we have a greater proportion of sort of legacy copper in those segments than in our Consumer segment. So the headwinds there are slightly stronger. And particularly, Wholesale is very, very lumpy in the nature of the way that business comes through. It's a little bit difficult to predict quarter-over-quarter. But to answer your question directly, I think we are now firmly on a trajectory to stabilize that business this year, as we said previously, very pleased about that. I think that's going to continue for some time. And then as our new fiber growth continues to accelerate, at some point in time, that will outweigh the legacy. When exactly that is, we'll have to talk about on subsequent quarters.

現在，我們在這些細分市場中擁有比我們的消費細分市場更大比例的傳統銅也是事實。因此，那裡的逆風稍強。特別是，批發業的業務發展方式本質上非常非常不穩定。預測季度環比有點困難。但直接回答你的問題，我認為我們今年正堅定地走在穩定業務的軌道上，正如我們之前所說，對此感到非常高興。我認為這種情況將持續一段時間。然後，隨著我們的新光纖增長繼續加速，在某個時間點，這將超過傳統光纖。確切的時間是這樣，我們將不得不在接下來的幾個季度中討論。

Our next question comes from the line of Phil Cusick with JPMorgan.

我們的下一個問題來自菲爾·庫西克與摩根大通的對話。

A couple of follow-ups. I guess, first, Brett's first question, Nick, because I'm not sure I understood your comments. And this goes to a little bit of what Scott was talking about as well. Just talk about the potential to accelerate fiber penetration from here. Or do you prefer to push harder on ARPU as you think about the combination of revenue growth? How should we think about that ARPU trending from here?

一些後續行動。我想，首先，布雷特的第一個問題，尼克，因為我不確定我是否理解你的評論。這也涉及到斯科特所談論的一些內容。就從這裡談談加速纖維滲透的潛力吧。或者，當您考慮收入成長的組合時，您是否更願意加大 ARPU 的力度？我們該如何看待 ARPU 趨勢？

And then, Scott, I think you just said you expect fiber adds to increase in Q4. Is that quarter-to-quarter or year-over-year? And then in '24 as well?

然後，斯科特，我想您剛剛說過您預計第四季度纖維添加量會增加。是季度環比還是年比？然後24年也是如此？

Yes, Phil. I think the straight answer to your question is both. If we look at how we're accelerating penetration in our base, which, of course, we've separated from our expansion markets, specifically to show the potential for us to grow penetration in a mature market, and we are systematically increasing penetration quarter over quarter over quarter and now well on our track to our terminal penetration of 45% or above.

是的，菲爾。我認為你的問題的直接答案是兩者兼而有之。如果我們看看我們如何加速在我們的基地的滲透率，當然，我們已經將其與我們的擴張市場分開，特別是為了展示我們在成熟市場中提高滲透率的潛力，並且我們正在系統地提高滲透率季度逐季成長，現在我們的終端滲透率預計將達到 45% 或更高。

We know that's doable because we've got lots of markets that are already at that level of penetration or indeed some that are higher and then moving the average of that base fiber market up 45% critical indicator of what's possible as we build new fiber. Now we're also tracking to exactly the ranges at the 12- and 24-month cohort we said in our new fiber build as well. So I'm highly confident that we can drive penetration up in new fiber builds to match that in base fiber builds over time, and that's an important part of our model.

我們知道這是可行的，因為我們有很多市場已經達到了這種滲透率水平，或者實際上有些市場滲透率更高，然後將基礎纖維市場的平均水平提高了45%，這是我們建造新纖維時可能實現的關鍵指標。現在，我們也在準確地追蹤我們在新纖維構建中所說的 12 個月和 24 個月組的範圍。因此，我非常有信心，隨著時間的推移，我們可以推動新光纖構建的滲透率與基礎光纖構建的滲透率相匹配，這是我們模型的重要組成部分。

Now separately, I've also talked about our pricing strategy and our ARPU development strategy. And there, we've taken some very clear and thoughtful actions to grow our ARPU. First of all, we reduced the use of gift cards. We've implemented a number of pricing adjustments with unbundled value-added services. And we've built a pricing ladder, which really incentivizes customers, first of all, to take gigabit speed, but then to move up that gigabit speed ladder. And now we have more than half of our new customers choosing gigabit-plus speeds and value-added service attach rates have more than doubled with 40% of our new customers taking one or more value-added service. So as we do both of these things, I believe it is absolutely possible to drive up penetration as we're seeing and drive up ARPU as we're demonstrating.

現在我還分別講了我們的定價策略和ARPU發展策略。在那裡，我們採取了一些非常明確和深思熟慮的行動來提高我們的 ARPU。首先，我們減少了禮品卡的使用。我們透過非捆綁式加值服務實施了多項定價調整。我們建立了一個定價階梯，它確實激勵客戶先採用千兆位元速度，然後再提升千兆位元速度階梯。現在，我們有超過一半的新客戶選擇千兆以上的速度，增值服務附加率增加了一倍多，其中 40% 的新客戶選擇一項或多項增值服務。因此，當我們做這兩件事時，我相信絕對有可能提高我們所看到的滲透率並提高我們所展示的 ARPU。

Scott, over to you.

史考特，交給你了。

Sure, Phil. On your question on net adds, you're correct. We expect Q4 to be up versus Q3 of this year, and we also expect it to be up versus Q4 of last year, so up year-over-year and quarter-over-quarter. And then we haven't given specific 2024 guidance on net adds, but we do expect the total volume of net adds to be up in 2024 versus 2023.

當然，菲爾。關於您在網路上提出的問題，您是正確的。我們預計第四季將比今年第三季有所成長，我們也預計它會比去年第四季有所成長，因此同比和環比都會成長。我們還沒有給出 2024 年淨增量的具體指導，但我們確實預計 2024 年淨增量總量將比 2023 年有所上升。

Our next question comes from the line of Peter Supino with Wolfe Research.

我們的下一個問題來自 Wolfe Research 的 Peter Supino。

I had a question about longer-term penetration. A familiar question, but one that we still hear all the time from clients is how your confidence is built in the attractiveness of the next several million homes? The concern is always that you've built the best ones first and that the penetration of the later vintages will be worse. And so anything you could share about your process for evaluating those opportunities bottom up and what the characteristics are that underpin your confidence?

我有一個關於長期滲透的問題。這是一個熟悉的問題，但我們仍然經常從客戶那裡聽到一個問題：您如何對未來幾百萬套房屋的吸引力建立信心？人們總是擔心你先釀造了最好的葡萄酒，而後期年份的滲透率會更差。那麼您可以分享一下您自下而上評估這些機會的過程嗎？支撐您信心的特徵是什麼？

Yes. Perhaps -- thanks, Peter. I'll take that and then perhaps hand to Scott. I mean, look, our long-term penetration rates, as we've said, are to some extent, founded on the fact that we have many of our more mature markets already at or above our 45% or better terminal penetration rate. So we know this is doable, point one.

是的。也許——謝謝，彼得。我會把它交給斯科特。我的意思是，正如我們所說，我們的長期滲透率在某種程度上是建立在這樣一個事實之上的：我們的許多更成熟的市場已經達到或高於45% 或更高的終端滲透率。所以我們知道這是可行的，第一點。

Point two, that base was at some point inherited from the companies that Frontier bought that from where penetration was actually higher in the past. And for various reasons, way before any of the current team here, that penetration was last drift down. We're now systematically building it back up to levels that it was previously at.

第二點，這個基礎在某種程度上是從 Frontier 收購的公司繼承的，這些公司過去的滲透率實際上更高。由於各種原因，遠早於目前這裡的任何團隊，滲透率最後一次下降。我們現在正在系統地將其恢復到以前的水平。

And why is that doable? Well, because we've got an extremely favorable market structure where in 86% of our fiber footprint, we have one or fewer gigabit-plus capable competitors. And that market structure is likely to remain very stable into the future. And that, combined with our fiber expansion plans, our (inaudible) go to market are very purposeful and clear pricing strategy, means I strongly believe we'll be able to grow our terminal penetration right across the base over time to 45% or above. Scott?

為什麼這是可行的？嗯，因為我們擁有極其有利的市場結構，在我們 86% 的光纖足跡中，我們擁有一個或更少的千兆以上能力的競爭對手。而且這種市場結構未來可能會保持非常穩定。結合我們的光纖擴張計劃，我們（聽不清楚）的市場投放是非常有目的和明確的定價策略，這意味著我堅信，隨著時間的推移，我們將能夠將整個基地的終端滲透率提高到45% 或以上。史考特？

Yes. And Peter, on your question of kind of cohort-by-cohort penetration, have we taken the best ones and left subpar once for later. The answer is no. We have a long enough track record now, if you look at 2020 cohort, 2021 cohort, 2022 cohort, those are all within the target ranges of 15% to 20% after 12 months, 25% to 30% after 24 months. Those all look different. They have different mixes of geographies, different mixes of unit types. We've said every cohort is different. But eventually, at 12 months and 24 months, it will get into the same penetration range.

是的。彼得，關於逐組滲透的問題，我們是否選擇了最好的，並把低於標準的留到以後再說。答案是不行。我們現在有足夠長的追蹤記錄，如果你看看2020 年隊列、2021 年隊列、2022 年隊列，這些都在12 個月後15% 至20%、24 個月後25% 至30% 的目標範圍內。這些看起來都不一樣。他們有不同的地理位置組合，不同的單位類型組合。我們說過每個群體都是不同的。但最終，在 12 個月和 24 個月時，它將進入相同的滲透範圍。

We've now expanded our build. We're building in roughly 15 states. We think the new states that we're building in are just as attractive penetration wise as the states that we started building in. So when we look at the next several years of penetration, we expect each of those individual cohorts to be in that 15% to 20% range at 12 months.

我們現在已經擴大了我們的建設。我們正在大約 15 個州進行建設。我們認為，我們正在建造的新州與我們開始建造的州一樣具有吸引力。因此，當我們考慮未來幾年的滲透率時，我們預計這些單獨的群體中的每一個都將屬於這15 個州. 12 個月時範圍為 % 至 20%。

Our next question comes from the line of Michael Rollins with Citi.

我們的下一個問題來自花旗銀行的 Michael Rollins。

Thanks. I'm curious if you can give us an update on the last 1/3 of the footprint in terms of what you may be thinking today, in terms of monetization opportunities for some of the footprint, fiber builds and BEAD opportunities. And then just more broadly, how is the fiber Board and management team viewing the public market as the right place for Frontier to be for the multiyear investment plan for your fiber strategy?

謝謝。我很好奇您能否向我們介紹一下您今天可​​以想到的關於最後 1/3 足跡的最新情況，包括某些足跡、光纖構建和 BEAD 機會的貨幣化機會。更廣泛地說，光纖董事會和管理團隊如何將公開市場視為 Frontier 為您的光纖策略制定多年投資計畫的合適場所？

Thanks, Michael. Perhaps I'll take the last one and Scott, on to you for BEAD. I mean, look, we're not going to comment on whether the public market or other structures are the right structure for Frontier to operate within. I mean, that's something for the Board to consider. And the Board is always considering all of the options for Frontier to create long-term shareholder value.

謝謝，麥可。也許我會選擇最後一個，斯科特，你的珠子。我的意思是，我們不會評論公開市場或其他結構是否是 Frontier 營運的正確結構。我的意思是，這是董事會需要考慮的事情。董事會一直在考慮 Frontier 創造長期股東價值的所有選擇。

What I can say is that I firmly believe in the strategy that we've got of building fiber as fast as we can, penetrating that fiber rapidly, improving customer care for all customers and continuing to become an ever-more efficient business is exactly the right mechanic to create long-term shareholder value by expanding our fiber footprint in a way that we know there is clear demand for. We know we can penetrate these markets, we know we can build efficiently, and we believe that, that is the right recipe to create long-term shareholder value.

我能說的是，我堅信我們的策略是盡快建立光纖、快速滲透光纖、改善所有客戶的客戶服務並繼續成為更有效率的企業，這正是我們的策略。透過以我們知道有明確需求的方式擴大我們的纖維足跡來創造長期股東價值的正確機制。我們知道我們可以滲透這些市場，我們知道我們可以有效地建設，我們相信，這是創造長期股東價值的正確秘訣。

Scott, do you want to comment on BEAD?

Scott，你想對 BEAD 發表評論嗎？

Sure. So Michael, your question -- on your question of the last 1/3 of our footprint. So the 5 million following the committed build of 10 million, I think that 5 million falls in a few buckets. One, we've said beyond the committed build of 10 million, there could be 1 million to 2 million that makes sense for private capital. So our capital to pass. That has not been the focus of ours thus far. Our focus is on the 10 million, but we are starting to look at ways to potentially expand into that 1 million to 2 million.

當然。邁克爾，你的問題——關於我們足跡的最後 1/3 的問題。因此，在承諾建造 1000 萬之後，接下來的 500 萬，我認為 500 萬屬於幾個部分。第一，我們說過，除了承諾建造的 1000 萬個項目之外，可能還有 100 萬到 200 萬個項目對私人資本來說是有意義的。所以我們的資本要過去。到目前為止，這還不是我們的重點。我們的重點是 1000 萬，但我們正在開始尋找可能擴展到 100 萬到 200 萬的方法。

The bulk of that 5 million will be best built out with fiber if we receive subsidies. So we are active in subsidy programs now before BEAD really gets rolling, we'll be an active participant in BEAD. And we think the BEAD program is very important to connect all of the unserved and underserved homes and businesses to the digital economy, and we will be an active participant in BEAD. So the focus is on the committed build of 10 million, but we are starting to look at creating value beyond that 10 million.

如果我們獲得補貼，這 500 萬人口中的大部分最好用光纖來建造。因此，我們現在正在積極參與補貼計劃，在 BEAD 真正啟動之前，我們將成為 BEAD 的積極參與者。我們認為 BEAD 計劃對於將所有未獲得服務和服務不足的家庭和企業連接到數位經濟非常重要，我們將成為 BEAD 的積極參與者。因此，重點是承諾建造 1000 萬，但我們開始考慮創造超過 1000 萬的價值。

Our next question comes from the line of Simon Flannery with Morgan Stanley.

我們的下一個問題來自西蒙·弗蘭納裡 (Simon Flannery) 與摩根士丹利 (Morgan Stanley) 的對話。

Great. Nice to see the ARPU trends coming through. Could you just talk a little bit about what you're seeing on the tier mix? What levels are people coming in at? Are you getting existing customers upgrading to higher speeds? I know you've had some -- a lot of focus on some of your above 1 gig type tiers.

偉大的。很高興看到 ARPU 趨勢的出現。能簡單談談您在層級組合中看到的情況嗎？人們進入的水平如何？您是否正在讓現有客戶升級到更高的速度？我知道您對 1 級以上的一些演出類型級別有很多關注。

And then any comment on -- you talked about different moves with different sales channels. Perhaps you could update us on where you stand on that? And I guess, finally, the cable companies, particularly Charter is coming up on the first anniversary of some of these discounted bundles. Do you think there's an opportunity for you there to take share as those prices get reset?

然後，您談到了不同銷售管道的不同舉措。或許您可以向我們介紹您對此的最新立場嗎？我想，最後，有線電視公司，特別是 Charter 即將迎來其中一些折扣捆綁包的一周年紀念日。您認為隨著價格的重置，您有機會獲得份額嗎？

Yes, Simon, thanks. It's Nick here. I mean, we don't disclose the individual mix on sort of a gigabit plus speed -- but what I can say is as we've extended our gigabit pricing ladder from 0.5 gig to 1 gig, 1 gig to 2, and then more recently, 5 gig, it has had exactly the impact on the overall speed mix that we hoped it would. So we have the kind of headline product, 5-gig -- first company to launch 5 gig symmetrical services network-wide, the first company to launched 2-gig symmetrical services network-wide.

是的，西蒙，謝謝。尼克在這裡。我的意思是，我們不會透露千兆位元加速度的單獨組合- 但我可以說的是，我們已經將千兆位元定價階梯從0.5 GB 擴展到1 GB，從1 GB 擴展到2 GB，然後更多最近，5 gig，它對整體速度組合的影響正是我們所希望的。因此，我們有這樣的頭條產品，5-gig——第一家在全網路範圍內推出 5g 對稱服務的公司，第一家在全網路範圍內推出 2g 對稱服務的公司。

And in both cases, we found as a cohort of customers who wanted the newest, who wanted the best, who wanted the fastest and they buy into that tier. That then has the effect of pulling the tier below up the speed ladder. And so it shifts the entire speed mix to the right and up. And then, of course, we unbundled value-added services that we used to give away for free and started charging those, have the kind of strange effect that then actually the take rate went up. So we generated more revenue and greater take rate on value-added services.

在這兩種情況下，我們發現一群客戶想要最新的、想要最好的、想要最快的，而且他們購買了該等級的產品。這就會產生將下面的層拉上速度階梯的效果。因此它將整個速度組合向右和向上移動。然後，當然，我們將過去免費提供的增值服務分拆並開始收費，產生了一種奇怪的效果，實際上使用率上升了。因此，我們創造了更多的收入和更高的增值服務利用率。

And those things combined are what's leading to a very systematic, structural, determined, purposeful way of increasing customer value systematically. And we're not done there, by the way. Our network is already 10 gig capable end-to-end, and there's a clear path to 25 gig and beyond at a very, very low CapEx requirement if we ever needed to do that, and we haven't made that decision, but it's an option for us in the future. So very pleased with the way that pricing ladder is working, and it clearly meets a customer demand at every speed and price point.

這些因素結合在一起，形成了一種非常系統化、結構化、堅定、有目的的方式來系統化地增加客戶價值。順便說一句，我們的工作還沒結束。我們的網路已經具備10 GB 端到端能力，並且如果我們需要這樣做的話，有一條明確的途徑可以以非常非常低的資本支出要求達到25 GB 及以上，而且我們還沒有做出這個決定，但它是我們未來的一個選擇。對定價階梯的運作方式非常滿意，它顯然滿足了客戶在各個速度和價格點的需求。

On sales channels, again, we don't disclose the exact mix, but across door-to-door, telesales, digital, inside sales and so on, we are continually optimizing that mix. And we optimize it not just across the country, but state by state, city by city to make sure that the channel best meets the demographic and penetration rate that we're trying to sell into, are always looking at the most efficient way to sell. And sometimes that throws up strange thing, you think digital would perhaps be the most efficient way to sell and sometimes it is and sometimes it isn't. And we adjust day-to-day, month-to-month as we go forward, always trying to find the best way to drive penetration at the lowest unit cost.

在銷售管道方面，我們沒有透露確切的組合，但在上門銷售、電話銷售、數位銷售、內部銷售等方面，我們正在不斷優化這個組合。我們不僅在全國範圍內進行優化，而且還在各州、各個城市進行優化，以確保該管道最好地滿足我們想要銷售的人口和滲透率，並且始終尋找最有效的銷售方式。有時這會引發奇怪的事情，你認為數位化可能是最有效的銷售方式，但有時是，有時不是。隨著我們的前進，我們每天、每月都在調整，總是試圖找到以最低單位成本提高滲透率的最佳方法。

Yes. So on your final question of discounted bundles, will the expiration of those help us? We compete on a number of dimensions. Like Nick said, we have a superior product. We have now superior customer experience versus our competitors, and we have a favorable market structure. So I think in general, people are -- you can see from our customer net add numbers that customers are increasingly choosing fiber versus a cable alternative, and we think that will continue.

是的。那麼，關於折扣捆綁包的最後一個問題，這些捆綁包的過期會對我們有幫助嗎？我們在多個方面進行競爭。正如尼克所說，我們擁有優質的產品。與競爭對手相比，我們現在擁有卓越的客戶體驗，並且擁有有利的市場結構。所以我認為總的來說，人們——你可以從我們的客戶淨增加數字中看到，客戶越來越多地選擇光纖而不是電纜替代品，我們認為這種情況將繼續下去。

Our last question will go to the line of Frank Louthan with Raymond James.

我們的最後一個問題將涉及弗蘭克·勞森（Frank Louthan）和雷蒙德·詹姆斯（Raymond James）的路線。

Back to your commentary on the margin additional cost savings. When you hit your 40% fiber penetration rate, how much of the legacy copper operating cost can you remove? And then how long does it take to get all of those costs out and really shut down the copper network? Give us an idea of how that kind of paces with the build going forward?

回到您對額外成本節省的評論。當您達到 40% 的光纖滲透率時，您可以消除多少傳統銅纜營運成本？那麼需要多長時間才能消除所有這些成本並真正關閉銅纜網路？讓我們了解一下未來建置的進度如何？

Sure, Frank. Let me talk about the margin, how that translates into margins and I'll talk about timing. So we're in the high 30s margin now. We've said in the steady state, we would move towards the mid-40s or potentially even high 40s. A lot of pure fiber players are even north of 50% margin. So just our fiber mix improving changes the margin profile. And then we've got to be aggressive in taking cost out of the legacy copper footprint and that happens in a few ways.

當然，弗蘭克。讓我談談利潤，如何轉化為利潤，我會談談時機。所以我們現在的利潤率高達 30 多美元。我們說過，在穩定狀態下，我們將走向 40 多歲，甚至可能達到 40 多歲。許多純光纖廠商的利潤率甚至超過 50%。因此，只要我們的纖維混合改善就會改變利潤狀況。然後我們必須積極降低傳統銅足跡的成本，這可以透過多種方式實現。

Number one, it happens incrementally where we reduce our copper customer base as they transition to fiber. That improves customer experience. We have fewer repairs, fewer calls, lower electricity costs as we kind of migrate customers off of copper. And those happen incrementally, you'll see that just in a gradual improvement in the margins.

第一，當我們的銅纜客戶群轉向光纖時，這種情況會逐漸減少。這改善了客戶體驗。當我們將客戶從銅遷移出來時，我們的維修次數減少了，電話次數也減少了，電費也降低了。這些都是逐步發生的，你會看到利潤率逐漸提高。

The step change improvements in the margins happen when you get that final customer off of a copper wire center, you can decommission a full wire center of copper, take out the central office costs, take out the electricity cost, take out any remaining maintenance and repair costs. We're actively pursuing that cost mitigation, but it's a multiyear journey. So probably it will be a few years until you see those big step change improvements in cost reduction from our copper decommission, but we are improving margins all the time, you saw. We improved about 100 to 200 basis points versus last year. A portion of that is improving fiber mix and ARPU, but a portion of it is lower copper costs.

當您讓最終客戶脫離銅線中心時，利潤率會發生階躍變化，您可以停用整個銅線中心，扣除中央辦公室成本，扣除電力成本，扣除任何剩餘的維護成本和維修費用。我們正在積極尋求降低成本，但這是一個多年的過程。因此，可能需要幾年時間，您才能看到銅退役帶來的成本降低的巨大進步，但您看到，我們一直在提高利潤率。與去年相比，我們提高了約 100 至 200 個基點。其中一部分是改善光纖混合和 ARPU，但一部分是降低銅纜成本。

Thanks, Frank. That concludes our third quarter 2023 earnings call. Thank you all for joining us.

謝謝，弗蘭克。我們的 2023 年第三季財報電話會議到此結束。感謝大家加入我們。

That concludes the Frontier Communications Third Quarter 2023 Earnings Call. Thank you for your participation. I hope you have a wonderful rest of your day.

Frontier Communications 2023 年第三季財報電話會議到此結束。感謝您的參與。我希望您度過愉快的一天。