On July 17, 2024, Crown Castle Inc (CCI, Financial) released its 8-K filing reporting results for the second quarter ended June 30, 2024. Crown Castle International owns and leases roughly 40,000 cell towers in the United States and more than 85,000 route miles of fiber. The company leases space on its towers to wireless service providers and operates as a real estate investment trust (REIT).
Performance Overview
Crown Castle Inc (CCI, Financial) reported a decline in both revenue and earnings for Q2 2024. The company posted site rental revenues of $1,580 million, down 9% from $1,728 million in Q2 2023. Net income fell sharply to $251 million from $455 million in the same period last year, representing a 45% decrease. The net income per share diluted was $0.58, down from $1.05 in Q2 2023.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 | Change | % Change |
|---|---|---|---|---|
| Site Rental Revenues | $1,580 million | $1,728 million | $(148) million | (9)% |
| Net Income | $251 million | $455 million | $(204) million | (45)% |
| Net Income per Share Diluted | $0.58 | $1.05 | $(0.47) | (45)% |
| Adjusted EBITDA | $1,006 million | $1,188 million | $(182) million | (15)% |
| AFFO | $704 million | $891 million | $(187) million | (21)% |
| AFFO per Share | $1.62 | $2.05 | $(0.43) | (21)% |
Challenges and Strategic Adjustments
The decline in site rental revenues was primarily due to a $106 million impact from Sprint Cancellations, an $81 million decrease in amortization of prepaid rent, and a $24 million decrease in straight-lined revenues. Additionally, the company incurred $45 million in charges related to a restructuring plan announced in June 2024.
“Our second quarter results demonstrated the durability and consistency of Crown Castle’s business, and we remain on track to deliver our full year outlook for organic revenue growth of 4.5% in towers, 2% in fiber solutions, and double digits in small cells, adjusted for the impact of Sprint Cancellations,” said Steven Moskowitz, Crown Castle’s Chief Executive Officer.
Financial Achievements and Outlook
Despite the challenges, Crown Castle Inc (CCI, Financial) maintained its full-year 2024 outlook. The company expects site rental revenues to reach $6,340 million, net income of $1,158 million, and adjusted EBITDA of $4,168 million. The company also anticipates annualized run-rate operating cost savings of approximately $100 million due to reduced staffing levels and field office locations.
Income Statement and Cash Flow Highlights
Adjusted EBITDA for Q2 2024 was $1,006 million, down from $1,188 million in Q2 2023. AFFO decreased to $704 million, or $1.62 per share, from $891 million, or $2.05 per share, in the same period last year. Capital expenditures during the quarter were $329 million, with $302 million in discretionary capital expenditures and $27 million in sustaining capital expenditures.
Analysis and Conclusion
Crown Castle Inc (CCI, Financial) faced significant challenges in Q2 2024, including the impact of Sprint Cancellations and restructuring costs. However, the company’s strategic adjustments and cost-saving measures are expected to stabilize its financial performance. Investors should monitor the company’s progress in achieving its full-year outlook and the effectiveness of its restructuring efforts.
Explore the complete 8-K earnings release (here) from Crown Castle Inc for further details.
