Operator:
Welcome to the Liberty Broadband Corporation's 2025 Year End Earnings Call. During the presentation, all participants will be in listen-only mode. Afterwards, we will conduct a question and answer session. As a reminder, this conference will be recorded February 11. I would now like to turn the call over to Hooper Stevens, Senior Vice President of Investor Relations. Please go ahead.

Hooper Stevens:
Good morning. Thank you for joining us. This call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent Forms 10-Ks filed by Liberty Broadband Corporation with the SEC. These forward-looking statements speak only as of the date of this call, and Liberty Broadband Corporation expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in Liberty Broadband Corporation's expectations with regard thereto or any change in events, conditions, or circumstances on which such statements are based. On today's call, we will discuss certain non-GAAP financial measures for Liberty Broadband Corporation, including adjusted OIBDA, adjusted OIBDA margin, and free cash flow. Information regarding the required definitions along with the comparable GAAP metrics and reconciliations, including Schedule 1 and Schedule 2 for Liberty Broadband Corporation, can be found in the earnings press release issued today, which is available on Liberty Broadband Corporation's IR website. Speaking on today's call will be Ron Duncan, the CEO of Liberty Broadband Corporation, and Brian Wendling, Liberty Broadband Corporation's Chief Accounting and Principal Financial Officer. Also during the Q&A, we will take questions related to Liberty Broadband Corporation should they arise. Additional members of Liberty Broadband Corporation management will be available to assist Ron and Brian with questions. With that, I'll hand the call over to Ron Duncan.

Ron Duncan:
Thank you, Hooper, and good morning. Liberty Broadband Corporation had an exceptional year. We reported solid fourth-quarter results with achieved record revenue of over $1 billion and record adjusted EBITDA of more than $400 million, a significant milestone for the company. We continue to execute on our mission to deliver best-in-class connectivity across Alaska. Our consumer wireless base is expanding. We are realizing the benefits of last year's strong sales cycle in our business segment. We continue to sharpen our strategic focus as Alaska's only converged broadband and wireless provider following the exit of our video business last year. During the fourth quarter, we announced, executed, and completed our rights offering. The rights offering was fully subscribed, resulting in approximately $300 million in net proceeds. We are pleased with the outcome, which allows us ample flexibility to continuously canvas the market and fine-tune our strategy at the parent company level. We plan to use the proceeds for general corporate purposes as well as for potential strategic acquisitions, investments, or partnerships. Turning to the business, I'm proud of how nimble and effective our Liberty Broadband Corporation team is in ensuring the continuity of our network. First, in December, we experienced two fiber breaks, one in Dutch Harbor, which was repaired in early January in under two weeks, and the other in Dearing. We expect to incur repair costs this year in the low single-digit million range, with service expected to be restored at Dearing in the summer months after the ice goes out. Second, as we mentioned last quarter, Typhoon Helong hit Southwest Alaska in early October of last year. We fully restored service to the two villages that were hit in under four months. Beyond the small revenue overhang in January, we do not expect any ongoing impact on our business. We commend the entire Liberty Broadband Corporation team for their outstanding service to the communities that we serve. Turning now to our operating highlights. We grew consumer wireless subscribers 2% year over year and ended the year with 199,000 consumer wireless lines. We had a total of 207,500 wireless lines at year-end, including 8,500 business lines. We added 3,500 consumer wireless lines during the year, including 6,700 postpaid lines, largely as a result of our unlimited test drive promotion. We continue to see slow erosion in our prepaid and government-subsidized lifeline segments, partially offsetting the growth in our postpaid lines. On the data side, we saw a 3% decline year over year, exiting the year with 151,200 data subscribers. We lost 4,500 data subscribers during the year and 1,200 data subscribers during the fourth quarter. The decline of data subscribers over the past year is due to wireless substitution and limited competition from Starlink and others, exacerbated by a fiber break on a third-party network in which Liberty Broadband Corporation uses capacity. As of the third quarter, service has been restored, although we note that winning back customers in the service-impacted areas has been slow. We are proud of the operational and financial progress we made in 2025. We reported over $400 million of adjusted OIBDA, an exceptional milestone for Liberty Broadband Corporation. But looking ahead to this year, we expect the business to be stable. As we look forward to 2026, our operating priorities are first, to invest in our network infrastructure, deliver high-quality service to our customers. Second, to complete our build-out commitments under the Alaska plan. Third, to drive value and the benefits of convergence for our customers, and fourth, to continue bridging the digital divide through our rural expansion. Starting with our network infrastructure. We're offering 2.5 gigabit broadband connectivity everywhere that has fiber middle mile, which means we can offer it to an overwhelming majority of our customers. We're making progress improving the broadband network in Anchorage. We're in the process of upgrading the core, reducing node sizes, and upgrading to a 1.8 gigahertz plant. Our initial deployment is yielding positive results. We plan to significantly scale deployment of our HFC network this year. All the work that we are doing is DOCSIS 4.0 or 4.0 capable, enabling speeds that are multiple times what we have today. We will be rolling this out to markets outside of Anchorage this year, allowing us to get to five gigabits and ultimately beyond. We believe these changes will not only lead to higher speeds but also a network with better reliability and fewer maintenance requirements. The strength of this offering positions us well against competitors today and into the future. Next, on driving convergence and maximizing value and quality for our customers. We concluded our unlimited test drive promotion at year-end, which drove meaningful postpaid consumer wireless growth in 2025 to a peak of 165,400 lines. The first cohorts of our promotional subscribers are now rolling off, and while it's still early, we are seeing exceptionally strong retention rates. In January, we launched a twelve-month free promotion that we expect will further support postpaid wireless growth this year. As of year-end, approximately 40% of our broadband customers have one or more wireless lines, and approximately 62% of our postpaid wireless lines are sold as part of a bundle, up from 57% at the end of 2024. Our focus remains on delivering quality and value for all of our customers. Lastly, on bridging the digital divide in Alaska, through expansion and completing our build commitments on the Alaska plan. Just a few weeks ago, we announced that we had completed the build-out of the iHUC one net network, which brings fiber infrastructure to the Yukon Quest equipped Delta, ensuring residents there enjoy 2.5 gigabit service. We also remain on track to complete our build-out requirements for the Alaska plan this year and increase wireless speeds in the communities we serve. The new Alaska Connect fund will extend the Alaska plan to 2034. Our focus remains on providing 5G wireless service to all covered Alaskans over the coming years. Turning briefly to Bead, the State of Alaska has announced that Liberty Broadband Corporation has been provisionally awarded approximately $120 million in Bead fund. The award remains subject to approval by the NTIA. There remains substantial uncertainty about the timing of the final awards as the state is still in active negotiations with the NTIA regarding the ultimate distribution of Alaska to be funded. Any funding that Liberty Broadband Corporation ultimately receives will offset our capital costs as we expand in unserved locations. Regulatory and macro environment. From a macro perspective, Alaska's economy could be poised for some long-overdue economic growth. In mid-October, the Trump administration announced plans to open the Arctic National Wildlife Range to drilling, a development that could accelerate oil and gas activity across the state. Combined with the potential development of the gas line, these initiatives could drive substantial economic expansion in Alaska, lifting the Alaska economy and creating new opportunities with the potential of increased demand for our services. In summary, we are encouraged by an exceptional year of financial and operational performance. The peak of CapEx in 2026 and projected step down over the coming years back to our historical range of 15% to 20% of revenue should be highly supportive of substantial cash generation as we look ahead. We believe the strength of our network and our robust operating results will continue to create value for our customers, partners, and shareholders. With that, I'll turn it to Brian to discuss the financials in more detail.

Brian Wendling:
Thank you, Ron, and good morning, everyone. At year-end, Liberty Broadband Corporation had consolidated cash, cash equivalents, and restricted cash of $429 million, which is inclusive of our approximately $300 million offering, which was completed at the end of 2025. And we had a total principal amount of debt of approximately $1 billion. At year-end, Liberty Broadband Corporation's net leverage, as defined in its credit agreement, was 2.3 times, and Liberty Broadband Corporation's consolidated net leverage was 1.6 times, which incorporates cash at the parent level, including the proceeds from the rights offering, as well as Liberty Broadband Corporation's non-voting preferred stock. Additionally, Liberty Broadband Corporation's credit facility has $377 million of undrawn capacity net of letters of credit. Just an admin matter during the fourth quarter, we refined the definition of our subscriber metrics. The definitions of consumer cable and wireless subscribers now exclude prepaid customers who are no longer paying for the service and postpaid and cable modem customers who have been inactive for over sixty days. All prior periods have been reflected for this refined definition, and this aligns with how Liberty Broadband Corporation manages and evaluates the business. Turning to Liberty Broadband Corporation's operating results for the full year and the fourth quarter. For the year, Liberty Broadband Corporation generated total revenue of $1 billion, representing a 3% increase for the full year. Revenue increased primarily due to growth at Liberty Broadband Corporation business. Adjusted OIBDA of $403 million was a record high and increased 12% for the full year. The increase was driven by both higher revenue and lower operating expenses, which includes lower programming video programming expenses, and reduced distribution costs related to temporary cost savings from a fiber break on a third-party network. The fiber break was fully restored during 2025. In the fourth quarter, Liberty Broadband Corporation generated total revenue of $262 million. This is flat with the prior year quarter. And adjusted OIBDA increased 7% to $90 million, primarily due to lower selling, general, and administrative expenses related to personnel and compensation expenses. Consumer revenue declined 2% for the full year in the fourth quarter, with the majority of the decline driven by the shutdown of the video business as well as data subscriber losses slightly offset by growth in wireless. As a reminder, Liberty Broadband Corporation exited the video business during the third quarter of the year. Consumer wireless revenue increased both for the full year and the fourth quarter, driven by an increase in federal wireless subsidies. Consumer gross margin increased to 70.7% for the full year and increased to 69.7% for the fourth quarter, driven by a decline in consumer direct costs resulting from decreases in video programming costs. For the year, direct costs also benefited from temporary cost savings from the fiber break on the third-party network that was previously discussed. Business revenue grew 7% for the year and 1% during the fourth quarter. For the year, the increase was driven by the strong upgrade cycle, which started in 2024. For both the full year and fourth quarter, revenue growth was partially offset by lower wireless roaming revenue. Business gross margin increased to 80.1% for the year and increased to 78.3% for the fourth quarter, primarily driven by revenue growth. For the year, business gross margin benefited from lower direct costs due to temporary cost savings from the aforementioned third-party fiber break. Capital expenditures net of grant proceeds totaled $224 million for the year. As Ron said, we expect 2026 CapEx of approximately $290 million, which includes $20 million carried over from 2025 due to normal course timing shifts. As was mentioned, we expect '26 to represent our peak year of CapEx spend, driven by completing the build-out requirements of the Alaska plan, and the timing shifts for 2025. Our historical CapEx has been 15% to 20% of revenue, and we expect our long-term CapEx following the completion of the Alaska plan build-out to trend back to these levels. Liberty Broadband Corporation generated $146 million in free cash flow for the full year, up over 70% from 2024, driven by our record financial growth. And 2025 free cash flow also benefited from positive working capital swings. The CapEx increase in 2026, when coupled with ordinary course working capital swings, will drive proportionately lower free cash flow on a year-over-year basis. And with that, I'll turn the call back over to Ron.

Ron Duncan:
Thank you, Brian. We appreciate everyone's interest in Liberty Broadband Corporation, and we look forward to continuing to update you on our progress. With that, we'll open the call up for Q&A.

Operator:
Thank you. We'll now be conducting a question and answer session. Thank you. And the first question comes from the line of David Joyce with Seaport Research. Please proceed with your questions.

David Joyce:
Thank you. A couple of questions, please. First, I was wondering how we should think about margins this year since you'll be comping against the operational savings while the undersea fiber was offline in the first part of last year and then you don't have the TV programming expenses? And then secondly, what sort of cadence of CapEx spending should we expect this year? And if you could kind of drill down on where, you know, where you would be spending which products? Thanks.

Ron Duncan:
Okay. Pete, do you want to tackle the margin question? Pete, you're out there? No, Pete. Okay. Well, I will do my best on the margins. The margins should be was Pete there? Pete just joined. No, Tyler. Go ahead. I'm happy to take the margin question, and you can add some color if you want. I think on the margin, we obviously can't guide, David. On where we think we'll ultimately end up for 2026. Jake, as you heard Ron say in his remarks, we expect a stable year for 2026. There are certainly some things on the cost side that are benefits, meaning no video expense at all during 2026. We also had revenue that was offsetting that in the early part of the year. And then there was the benefit from the fiber break. But overall, we expect a pretty stable year for next year. And I have Ron's comment yes, I'll take the CapEx. I would just comment on margins as well that the video business was kind of a net zero for us anyway by the time we got out. They were substantial revenues, but also very substantial programming costs. The reasons we exited was we could see ourselves heading into a negative free cash flow situation to stay in the video business. So it was a net positive going forward and probably not tremendous change in the base of the business as you look at it. On the CapEx cadence, typically, we peak in the second and third quarters. When the construction season is in full swing up here, and I expect that pattern to continue this year. The largest single element of this year's CapEx is in wireless, particularly rural wireless, as we sprint to the finish of our first phase commitments under the Alaska plan. We'll also be expanding substantial CapEx to expand the urban wired network as we move to our 5G and full DOCSIS 4.0 implementation.

David Joyce:
Great. Thank you. Thank you.

Brian Wendling:
David, if you don't have any other questions, that will conclude today's call. Appreciate everybody's participation. And we look forward to speaking to you offline in next quarter as well. Thank you.

Ron Duncan:
Thank you all very much.

Operator:
Thank you. This will conclude today's conference. You may disconnect your lines at this time. We thank you for your participation. Have a wonderful day.