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Crown Castle has slightly increased its full-year site rental revenue and adjusted funds from operations (AFFO) forecasts, supported by continued growth in data consumption and demand for wireless infrastructure across the United States. While the company reported quarterly site rental revenue below analysts' estimates, its AFFO exceeded market expectations. The company is also continuing its strategic shift to become a pure-play tower operator after selling its fiber assets last year and announcing workforce reductions earlier this year as part of its restructuring efforts.
U.S.-based telecom infrastructure company Crown Castle has marginally raised its full-year site rental revenue forecast, reflecting continued demand for wireless infrastructure driven by rising mobile data consumption.
The company now expects annual site rental revenue, which is generated from leasing telecom infrastructure and properties to wireless carriers, to be between USD 3.83 billion and USD 3.88 billion, compared with its earlier guidance of USD 3.83 billion to USD 3.87 billion.
Crown Castle, which leases its network infrastructure to major telecom operators including AT&T, T-Mobile US and Verizon Communications, has been benefiting from growing demand for mobile data services. The increase in data usage has led telecom operators to continue investing in network capacity, supporting demand for cell tower infrastructure.
The company also raised its full-year adjusted funds from operations (AFFO) forecast to USD 4.53 to USD 4.65 per share, up from its earlier projection of USD 4.38 to USD 4.49 per share, indicating expectations of stronger recurring cash flow during the year.
For the quarter ended June 30, Crown Castle reported site rental revenue of USD 967 million, which was below analysts' estimate of USD 997 million, according to LSEG data. However, the company reported adjusted funds from operations of USD 1.13 per share, exceeding the market expectation of USD 0.99 per share.
Crown Castle owns and operates more than 40,000 cellular towers across the United States and is continuing its transition into a pure-play tower operator. The move follows the company's decision to streamline its business by focusing on its tower portfolio after divesting its fiber business.
As part of this strategic transformation, Crown Castle had announced earlier this year that it would reduce its workforce by 20%. The decision came after the company completed the sale of its fiber assets for USD 8.5 billion last year, a move undertaken amid pressure from activist investor Elliott Investment Management to improve financial performance and strengthen shareholder returns.
Source Reuters
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