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AMZN
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2023-02-02
|
[
{
"description": "Director, Investor Relations",
"name": "Dave Fildes",
"position": "Executive"
},
{
"description": "Chief Financial Officer",
"name": "Brian Olsavsky",
"position": "Executive"
},
{
"description": "Chief Executive Officer",
"name": "Andy Jassy",
"position": "Executive"
},
{
"description": "Morgan Stanley -- Analyst",
"name": "Brian Nowak",
"position": "Analyst"
},
{
"description": "JPMorgan Chase and Company -- Analyst",
"name": "Doug Anmuth",
"position": "Analyst"
},
{
"description": "Goldman Sachs -- Analyst",
"name": "Eric Sheridan",
"position": "Analyst"
},
{
"description": "Bank of America Merrill Lynch -- Analyst",
"name": "Justin Post",
"position": "Analyst"
},
{
"description": "Citi -- Analyst",
"name": "Ron Josey",
"position": "Analyst"
},
{
"description": "Evercore ISI -- Analyst",
"name": "Mark Mahaney",
"position": "Analyst"
}
] |
[
{
"name": "Operator",
"speech": [
"Thank you for standing by. Good day, everyone, and welcome to the Amazon.com Quarter 4 2022 financial results teleconference. [Operator instructions] Today's call is being recorded. And for opening remarks, I will be turning the call over to the vice president of investor relations, Dave Fildes.",
"Thank you, sir. Please go ahead."
]
},
{
"name": "Dave Fildes",
"speech": [
"Hello, and welcome to our Q4 2022 financial results conference call. Joining us today to answer your questions is Andy Jassy, our CEO; and Brian Olsavsky, our CFO. As you listen to today's conference call, we encourage you to have our press release in front of you, which includes our financial results as well as metrics and commentary on the quarter. Please note, unless otherwise stated, all comparisons in this call will be against our results for the comparable period of 2021 Our comments and responses to your questions reflect management's views as of today, February 2nd, 2023 only, and will include forward-looking statements.",
"Actual results may differ materially. Additional information about factors that could potentially impact our financial results is included in today's press release and our filings with the SEC, including our most recent annual report on Form 10-K and subsequent filings. During this call, we may discuss certain non-GAAP financial measures. In our press release, slides accompanying this webcast and our filings with the SEC, each of which is posted on our IR website, you will find additional disclosures regarding these non-GAAP measures, including reconciliations of these measures with comparable GAAP measures.",
"Our guidance incorporates the order trends that we've seen to date and what we believe today to be appropriate assumptions. Our results are inherently unpredictable and may be materially affected by many factors, including uncertainty regarding the impacts of the COVID-19 pandemic; fluctuations in foreign exchange rates; changes in global economic and geopolitical conditions; and customer demand and spending, including the impact of recessionary fears, inflation, interest rates, regional labor market, and global supply chain constraints, world events, the rate of growth of the Internet, online commerce and cloud services and the various factors detailed in our filings with the SEC. Our guidance assumes, among other things, that we don't conclude any additional business acquisitions, restructurings, or legal settlements. It's not possible to accurately predict demand for our goods and services and, therefore, our actual results could differ materially from our guidance.",
"And now I'll turn the call over to Brian."
]
},
{
"name": "Brian Olsavsky",
"speech": [
"Thank you for joining today's call. As Dave mentioned earlier, I'm joined today by Andy Jassy, our CEO. Before we move on to take your questions, I will make some comments about our Q4 results. Let's start with revenue.",
"For the fourth quarter, worldwide net sales were $149.2 billion, representing an increase of 12% year over year, excluding approximately 360 basis points of unfavorable impact from changes in foreign exchange rates and above the top end of our Q4 guidance range. We've seen that during periods of economic uncertainty, consumers are very careful about how they allocate their resources and where they choose to spend their money. Throughout Amazon's history, we have found that our focus on the customer helps to set us apart in times like these. This past holiday season, customers came to Amazon for great deals, fast delivery, and our widest-ever selection, bolstered by nearly 2 million third-party seller partners who sell on Amazon.",
"Enterprise customers continued their multi-decade shift to the cloud while working closely with our AWS teams to thoughtfully identify opportunities to reduce costs and optimize their work. In our worldwide stores business, with the ongoing economic uncertainty, coupled with the continuation of inflationary pressures, customers remain cautious about their spending behavior. We saw them spend less on discretionary categories and shift to lower-priced items and value brands in categories like electronics. We also saw them continue to spend on everyday essentials, such as consumables, beauty, and softlines.",
"Our teams worked hard to offer low prices and secure millions of deals for customers in Q4, including our first-ever Prime Early Access Sale in October and the more traditional Thanksgiving to Cyber Monday holiday weekend. These global sales events outperformed our expectations as customers responded to millions of deals across our growing selection. Third-party sellers remain a key contributor to that expanding selection. In Q4, sellers comprised a record 59% of overall unit sales.",
"Sellers, vendors, and brands continue to look to Amazon's advertising capabilities to reach customers in the always competitive holiday season, even as the macro environment required them to scrutinize their own marketing budgets. We saw good growth in advertising revenues in Q4, up 23% year over year, excluding the impact of foreign exchange. Prime membership continues to be a great value for our customers, and improving our Prime benefits is a continuous part of our investment strategy. Along with competitive pricing, broad selection and faster delivery speed, we've seen Prime members respond to our expanding entertainment offerings.",
"During the quarter, we completed our first season of The Lord of the Rings: The Rings of Power, the most watched Amazon original series in every region of the world, reaching over 100 million viewers and driving more Prime sign-ups worldwide during its launch window than any previous Prime Video content. We also finished our inaugural season as the exclusive home of Thursday Night Football, reaching the youngest median age audience of any NFL broadcast package since 2013 and increasing viewership by 11% from last year among hard-to-reach 18- to 34- year-olds. In aggregate, we invested approximately $7 billion in 2022 across Amazon Originals, live sports, and licensed third-party video content included with Prime. That's up from about $5 billion in 2021.",
"As a reminder, these digital video content costs are included in cost of sales on our income statement. We regularly evaluate the return on the spend and continue to be encouraged by what we see, as video has proven to be a strong driver of Prime member engagement and new Prime member acquisition. Moving on to AWS. Net sales increased $21.4 billion in Q4, up 20% year over year and now representing an annualized sales run rate of more than $85 billion.",
"Starting back in the middle of the third quarter of 2022, we saw our year-over-year growth rates slow as enterprises of all sizes evaluated ways to optimize their cloud spending in response to the tough macroeconomic conditions. As expected, these optimization efforts continued into the fourth quarter. Some of the key benefits of being in the cloud compared to managing your own data center are the ability to handle large demand swings and to optimize costs relatively quickly, especially during times of economic uncertainty. Our customers are looking for ways to save money, and we spend a lot of our time trying to help them do so.",
"This customer focus is in our DNA and informs how we think about our customer relationships and how we will partner with them for the long term. As we look ahead, we expect these optimization efforts will continue to be a headwind to AWS growth in at least the next couple of quarters. So far in the first month of the year, AWS year-over-year revenue growth is in the mid-teens. That said, stepping back, our new customer pipeline remains healthy and robust, and there are many customers continuing to put plans in place to migrate to the cloud and commit to AWS over the long term.",
"Now let's shift to worldwide operating income. For the quarter, we reported $2.7 billion in operating income. The operating income was negatively impacted by three large items, which added approximately $2.7 billion of costs in the quarter. This was related to employee severance, impairments of property and equipment and operating leases, and changes in estimates related to self-insurance liabilities.",
"This cost primarily impacted our North America segment. If we had not incurred these charges in Q4, our operating income would have been approximately $5.4 billion. We are encouraged with the progress we continue to make in streamlining the costs in our Amazon stores business. We entered the quarter with labor more appropriately matched to demand across our operations network compared to Q4 of last year, allowing us to have the right labor in the right place at the right time and drive productivity gains.",
"We also saw continued efficiencies across our transportation network, where process and tech improvements resulted in higher Amazon Logistics productivity and improved line haul fill rates. While transportation overperformed expectations in the quarter, we also saw productivity improvements across our fulfillment centers, in line with our plan. We also saw good leverage driven by strong holiday volumes. Overall, it was a strong effort by the operations team, and we look forward to making further headway as we head into 2023.",
"We remain focused on driving cost efficiencies throughout the network and reducing our cost to serve our customers, while ensuring we maintain an outstanding customer experience. Circling back to the three large charges during the quarter. Let me share some additional color, starting with the job eliminations we initiated during the fourth quarter. As we consider the ongoing uncertainties of the macroeconomic environment, this led us to the difficult decision to eliminate just over 18,000 roles, primarily impacting our stores and device businesses as well as our human resources teams.",
"As a result, we recorded estimated severance cost of $640 million. These charges were recorded primarily in technology and content, fulfillment, and general administration on our income statement. Next, we recorded impairments of property and equipment and operating leases, primarily related to our Amazon Fresh and Amazon Go physical stores. We're continuously refining our store formats to find the ones that will resonate with customers, will build our grocery brand and will allow us to scale meaningfully over time.",
"As such, we periodically access our portfolio of stores and decided to exit certain stores with low growth potential. We'll also take an impairment on capitalized costs and associated values of our leased buildings. The impairment charge in Q4 was $720 million and is included in other operating expense on our income statement. We continue to believe grocery is a significant opportunity, and we're focused on serving customers through multiple channels, whether that's online delivery, pickup, or in-store shopping.",
"Lastly, during the quarter, we increased our reserves for general product and automobile self-insurance liabilities, driven by changes in our estimates about the cost of asserted and unasserted claims, resulting in additional expense of $1.3 billion. This impact is primarily recorded in cost of sales on our income statement. As our business has grown quickly over the last several years, particularly as we've built out our fulfillment and transportation network and claim amounts have seen industrywide inflation, we've continued to evaluate and adjust this reserve for both asserted claims as well as our estimate for unasserted claims. We reported overall net income of $278 million in the fourth quarter.",
"While we primarily focus our comments on operating income, I'd point out that this net income includes a pre-tax valuation loss of $2.3 billion included in nonoperating income from our common stock investment in Rivian Automotive. As we've noted in recent quarters, this activity is not related to Amazon's ongoing operations but rather the quarter-to-quarter fluctuations in Rivian's stock price. As we head into the new year, we remain heads-down focused on driving a better customer experience. We believe putting customers first is the only reliable way to create lasting value for our shareholders."
]
},
{
"name": "Andy Jassy",
"speech": [
"Everybody, this is Andy. Just before we start with the questions, I just wanted to say it's good to be with you all on the call today. I thought I might jump on the calls from time to time moving forward. And given that this last quarter was the end of my first full year in this role, and given some of the unusual parts in the economy and our business, I thought this might be a good one to join.",
"So thanks for having me."
]
}
] |
[
{
"name": "Operator",
"speech": [
"[Operator instructions] And our first question comes from the line of Brian Nowak with Morgan Stanley. Please proceed with your question."
]
},
{
"name": "Brian Nowak",
"speech": [
"Thanks for taking my questions. I have two. Andy, I want to ask you, just the first one, you've been in the seat for a while. As you sit there, what are your key focal points, product categories, or investment priorities that you're most focused on to drive durable multiyear growth in that North America retail segment as we recover? And then the second one, just sort of staying on the North America retail side, how do you think about the potential margin potential of that business over the next few years as you sort of grow into the warehouse? And what are the warehouse network? And what are the efficiency factors to get you to those goals? Thanks."
]
},
{
"name": "Brian Olsavsky",
"speech": [
"Brian, this is Brian. First, let me just start with your second question. On the -- sorry, can you hear me? On the expectation for retail margins, especially in North America, what we've said is when we look back to our cost structure pre-pandemic, we were just in the end of 2019, early part of 2020. We're just starting to roll out one-day shipping in North America, and we had an expectation of what our cost structure would look like.",
"That has changed quite a bit in the last three years now due to a doubling of our network expansion. I think you've heard me tell this story on different calls. But essentially, we're now trying to, again, regain our cost structure that we've had in the past, balance the -- and get more efficient on the assets we've added in the last two, three years now and also look at all the investment areas that we are working on to drive growth, continuing to look at them where we need to make course corrections, where we need to change things up. And we expect that, again, a lot of the improvement will be in North America operations costs.",
"We made good headway in 2022. We always want to make more, and we're going to be working on this definitely through 2023 and beyond. But we have to make and expect to make big improvements in 2023."
]
},
{
"name": "Andy Jassy",
"speech": [
"Yes. And I'll start just at a broad level, priority-wise. The connective tissue for everything we do across the company, including in stores in North America, is we realize that we exist to make customers' lives better and easier every day and relentlessly went to do so. And being maniacally focused on the customer experiences, always going to be a top priority for us.",
"At the same time, and this is true in North America as well as across the entire business, we're working really hard to streamline our costs and trying to do so at the same time that we don't give up on the long-term strategic investments that we believe can meaningfully change broad customer experiences and change Amazon over the long term. As I addressed directly the North American stores questions, I think our -- probably the No. 1 priority that I spent time with the team on is reducing our cost to serve in our operations network. And as Brian touched on, it's important to remember that over the last few years, we've -- we took a fulfillment center footprint that we've built over 25 years and doubled it in just a couple of years.",
"And then we, at the same time, built out a transportation network for last mile roughly the size of UPS in a couple of years. And so when you do both of those things to meet the huge surge in demand, you're going to -- just to get those functional, it took everything we had. And so there's a lot to figure out how to optimize and how to make more efficient and more productive. And then I think at the same time, if you think about doubling the number of fulfillment centers you have and then adding a very large transportation network and you realize that all of those facilities have to link together to get products to customers, that's a pretty big expansion in the number of nodes in the network.",
"It becomes a little bit different network. And so to figure out how to be really efficient across all those links and have them be highly utilized and to get the flows in those facilities working the right way, it takes time. So we're working very hard on it. I'm pleased with the progress we made in Q4, and you can see that in some of the results.",
"But that work will extend into '23. So that's first. I think the second thing, priority-wise, I would talk about is just speed. We believe they're continuing to get products to customers faster, makes customers happier, and they also converted a higher rate when they can see promises of deliveries that are faster.",
"I think selection will always be a very high area of focus for us. We work with hundreds of thousands in the U.S. and millions overall in the world of selling partners. In this past quarter, 59% of the units sold were from our third-party selling partners, and we work very hard to provide unmatched selection.",
"And that matters a lot to customers. I think pricing being sharp is always important. But particularly in this type of uncertain economy, where customers are very conscious about how much they're spending, having the millions of deals that we put together with our selling partners in the fourth quarter was an important part of the demand that you saw, and we'll continue to work really hard on being sharp on pricing. And then just the customer experience improvements that we're working all the time, whether it's adding Buy with Prime that allows Prime users to use their Prime benefits on other websites than just Amazon; or adding RxPass in the healthcare space, where our Prime customers for $5 a month can get all the medicines they're using in unlimited fashion; or whether it's just even in our apparel business, where when you're looking clothing you might buy, being able to see virtually your shoes with that outfit to see how it looks and it changes your customer experience, your buying experience, we will continue to work very hard on those customer experiences, and we have a lot more planned."
]
},
{
"name": "Operator",
"speech": [
"Thank you. And the next question comes from the line of Doug Anmuth with J.P. Morgan. Please proceed with your question."
]
},
{
"name": "Doug Anmuth",
"speech": [
"Thanks for taking the questions. Also for Andy, I have two. Just first, how would you evaluate your efforts in grocery thus far? I know you're -- it's a big, huge market. You're attacking it different ways.",
"What are the key steps here that you're focused on to drive greater market share? And then secondly, how should we think about the strategic importance of some of these emerging bets type of areas like healthcare and Kuiper and autonomous vehicles, among others? Thanks."
]
},
{
"name": "Andy Jassy",
"speech": [
"On the first one on grocery, I'd just start by saying that we think grocery is a really important and strategic area for us. It's a very large market segment, and there's a lot of frequency in how consumers shop for grocery. And we also believe that over time, grocery is going to be omnichannel. There are going to be a lot of people that order their grocery items online and have it delivered to them, and there are going to be a lot of people who continue to buy in physical stores.",
"But you're going to also see a hybrid of those, where people pick out what they want online and pick it up in stores, or people are in stores and there's something that's not in inventory in the stores, so they go to their app or to a kiosk and order it to be delivered from online. And so I think having omnichannel is going to really matter. And I think that we have a pretty significant-sized grocery business. I think people sometimes don't realize that and that we've been building for a long time.",
"It's continuing to accelerate, and I kind of see it broken into a few pieces. If you think about the online grocery offering, we have a very large business there. It looks different from the typical mega physical grocery store. But if you think about the aisles in a grocery store, from packaged food to paper products to canned goods to pet supplies to health and personal care items to consumables, we have a very large business there that continues to grow at a rapid clip and then we think will continue to grow.",
"But it doesn't have a big market segment share in perishables. And if you really want to have significant market segment share in perishables, you typically need physical stores. And we have kind of two different offerings there. For what I think is the very best organic physical store experience and selection, we have Whole Foods, which is a very significant-sized business that's continuing to grow.",
"I really like the progress that, that business has made on profitability in the last year. And I like what I see in front of it, and I think that's a very -- it's a premium product, but it's a significant business. It's a good business for us in the grocery space. I think if you want to have a mass physical store offering, you need a different offering.",
"And that's what we've been working on with Amazon Fresh, and we have a few dozen stores so far. We're doing a fair bit of experimentation today in those stores to try to find a format that we think resonates with customers. It's differentiated in some meaningful fashion and where we like the economics. And we've been -- we've decided over the last year or so that we're not going to expand the physical Fresh doors until we have that equation with differentiation and economic value that we like, but we're optimistic that we're going to find that in 2023.",
"We're working hard at it. We see some encouraging signs. And when we do find that equation, we will expand it more expansively. But I think that we have a very significant opportunity in the grocery segment.",
"I think we're building a pretty broad grocery network across online and physical, and you're going to see us continue to work on it."
]
},
{
"name": "Operator",
"speech": [
"Thank you. And our next question comes from the line of Eric Sheridan with Goldman Sachs. Please proceed with your question."
]
},
{
"name": "Eric Sheridan",
"speech": [
"Thanks so much. Maybe I'll ask one big picture of Andy and then just a housekeeping matter to Brian, if I can. Andy, keeping on this theme of sort of big picture and strategy and your perspective, I'd love to get your view on the international e-commerce businesses. Obviously, you're in a range of geographies with a wide variance of maturity and different investment cycles.",
"Can you give us your perspective on how you see Amazon's global e-commerce footprint today? And how investors should be thinking about the mix of growth and margin evolution in those international businesses in the years ahead? And maybe, Brian, if I can just ask a quick follow-up. In the Q1 operating income guidance that you gave, I think there's some confusion among investors as to where you might be capturing some of the restructuring charges from the announcements that the company has made on employee count between Q4 and Q1. Can you just clarify what was captured in Q4 versus what might be included in the way you frame the Q1 operating income guidance? Thanks so much."
]
},
{
"name": "Brian Olsavsky",
"speech": [
"Sure, let me start. This is Brian. Let me start with that second part. So as I said earlier, we took a $640 million charge tied to the position elimination that we announced in Q4.",
"A lot of that fell into Q1 into mid to late January. So the way to think about it is for the terminations in January, the salaries for the first three weeks are covered in operating results for Q1. But the period after that, where there's weeks or months of severance coverage, job placement, a lot of those costs are what the $640 million charge was in Q4. So I hope that helps."
]
},
{
"name": "Andy Jassy",
"speech": [
"And on the question about international e-commerce, we're very enthusiastic about the business we're building there. I think just perspective, if you look at the compounded annual growth rate from 2019 to '21, in the U.K., it was over 30%; in Germany, it was 26%; in Japan, it was 21%. And the fact that we haven't given back that growth, and these are all net of FX, but if you look at even the last couple of quarters where we're continuing to grow and we haven't given back some of that growth, a meaningful amount of market segment share has shifted to our global established e-commerce territories, and we're excited about that. Now we're -- at this stage, we're big enough in our developed international territories that when there's something significant happening in the macro, we're going to be impacted as well.",
"And if you just look in Europe as an example, the inflation is higher than most places and the impact on Europeans for the war in Ukraine is more significant, and also the energy prices and hikes there are more significant. So you can see that in some of our growth numbers. And then you look at our emerging countries, and these are -- they're all a little bit different in all -- in a little bit different stage as you recognize in the question. But if you look at countries like India and Brazil and the Middle East and Africa and Turkey, Mexico and Australia and a number of those types of countries, we like what we're seeing.",
"They take a certain amount of time. There's a certain amount of fixed investment you have to make when you enter a new geography, and then you have to drive a certain amount of revenue to be able to cover that fixed investment. But they're all on the right trajectory and following trajectories that roughly look like what we saw in North America and our established international geographies, and we think it's the right investment and believe we're going to have a large profitable international e-commerce business."
]
},
{
"name": "Operator",
"speech": [
"Thank you. And the next question comes from the line of Justin Post with Bank of America. Please proceed with your question."
]
},
{
"name": "Justin Post",
"speech": [
"Great. Thanks. Maybe one for Andy and then one for Brian. AWS, if you look at the revenue growth of mid-teens, it implies it could be flattish and even down this quarter.",
"So maybe talk about what's driving that. Is it workload changes? Are there some clients that are shifting? Anything on the market share you could comment on? And then second, when do you think this could recover? Like what's the time frame? And would you expect margins to come back when revenues reaccelerate? I'll leave it at that."
]
},
{
"name": "Brian Olsavsky",
"speech": [
"Thanks, Justin, for your question. This is Brian. Let me start with the -- what we're seeing at the customer level. So as I've mentioned, continuing -- it's across all industries.",
"There are some points of weakness, things like financial services, like mortgage companies that do. As mortgage volumes down, some of their compute challenges or compute volumes are down. Crypto is -- lower trading in crypto. And things tied to advertising, as there's lower advertising spend, there's less analytics and compute on advertising spend as well.",
"But -- so there's select of things. But by and large, what we're seeing is just an interest and a priority by our customers to get their spend down as they enter an economic downturn. We're doing the same thing at Amazon, questioning our infrastructure expenses as well as everything else. And we -- there's things you can do.",
"You can defer -- you can switch to lower-cost products. You can run calculations less frequently. There's just -- you can do different types of storage on your data. So there's ways to alter your cost and your bill in a short period of time.",
"I think that's what we're seeing. And as I said, we're working with our customers to help them do that. And again, we're seeing ourselves at Amazon. So I'll let Andy add some color on kind of the general trends in AWS, but that's more what we're seeing at the customer level right now."
]
},
{
"name": "Andy Jassy",
"speech": [
"So I would just add -- I mean, I think Brian covered a bunch of it. I think most enterprises right now are acting cautiously. You see it with virtually every enterprise, and we're being very thoughtful about streamlining our costs as well. And when you are being cautious, you look for ways that you can find -- you can spend less money.",
"And where companies can cost optimize or, in some cases, they may be used to doing analysis over 90 days of information and they say, \"Well, can I get away with it for two weeks, doing two weeks' worth,\" it's not necessarily the best thing long term. But a lot of companies will do that when they're in uncertain economic situation. And the reality is that the way that we've built all our businesses, but AWS in this particular instance, is that we're going to help our customers find a way to spend less money. We are not focused on trying to optimize in any one quarter or any one year, we're trying to build a set of relationships in business that outlast all of us.",
"And so if it's good for our customers to find a way to be more cost effective in an uncertain economy, our team is going to spend a lot of cycles doing that. And it's one of the advantages that we've talked about since we launched AWS in 2006 of the cloud, which is that when it turns out you have a lot more demand than you anticipated, you can seamlessly scale up. But if it turns out that you don't need as much demand as you had, you can give it back to us and stop paying for it. And that elasticity is very unusual.",
"It's something you can't do on-premises, which is one of the many reasons why the cloud is and AWS are very effective for customers. I think -- and I've spent a fair bit of time with the AWS team on this, and we look closely at what we see. We have a very robust, healthy customer pipeline, new customers, migrations that are set to happen. A lot of companies during times of discontinuity like this will step back and think about what they want to change strategically to be in a position to reinvent their businesses and change their customer experiences more quickly as uncertain economies emerge, and that often means moving to the cloud.",
"We see a number of those pieces as well. And we're the only ones that really break out our cloud numbers in a more specific way. So it's always a little bit hard to answer your question about what we see. But we, to our best estimations, when we look at the absolute dollar growth year over year, we still have significantly more absolute dollar growth than anybody else we see in this space.",
"And I think some of that's a function of the fact that we just have a lot more capability by a large amount, with stronger security and operational performance and a larger partner ecosystem. So I think it's also useful to remember that 90% to 95% of the global IT spend remains on-premises. And if you believe that, that equation is going to shift and flip, I don't think on-premises will ever go away, but I really do believe in the next 10 to 15 years that most of it will be in the cloud if we continue to have the best customer experience, which we have to work really hard at an event which we're working to do. It means we have a lot of growth in front of us in the AWS business."
]
},
{
"name": "Operator",
"speech": [
"And our next question comes from the line of Ron Josey with Citi. Please proceed."
]
},
{
"name": "Ron Josey",
"speech": [
"Great. Thanks for taking the question. Maybe a bigger high-level question here just around Prime member engagement and just seeing third-party seller services growth accelerating in the quarter. And I believe it was mentioned that customer is spending more on everyday essentials, which may be a relatively new use case.",
"Talk just a little bit more, maybe Andy and Brian, just around how engagement is evolving here for Prime members and really how this has grown wallet share over time and where this is going. Thank you."
]
},
{
"name": "Brian Olsavsky",
"speech": [
"Yes. Thanks, Ron, for your question. I would say that the Prime membership is -- remains strong and so has the dollars purchased per Prime member. It varies a bit by geography.",
"But in general, if you step back, we had some very large video properties that we had launched last year, Thursday Night Football and Lord of the Rings: Rings of Power. Both of them had record sign-ups for Prime membership. And we know that, again, investments like that will help with not only a new member or new Prime member acquisition, but also retention. And we see a direct link between that type of engagement and higher purchases of everyday products on our Amazon website.",
"So the health of Prime is very strong. As Andy mentioned earlier, we are continuing to work to get our speed of delivery up to get more one-day shipments. And we think that will also be well received by Prime members. But it's a combination of price selection and convenience.",
"I think we've made inroads on all of them, especially with the third-party selection that's been added over the last few years. So I think testament to that is the sales that we had in the fourth quarter. In a very competitive and deal-driven environment, people came, Prime members and others came to Amazon to do their shopping. So we're encouraged by it."
]
},
{
"name": "Andy Jassy",
"speech": [
"Just to add really one piece here, which is just, if you step back and think about a lot of subscription programs, there are a number of them that are $14, $15 a month really for entertainment content, which is more than what Prime is today. If you think about the value of Prime, which is less than what I just mentioned, where you get the entertainment content on the Prime Video side and you get the shipping benefit, the fast shipping benefit you can't find elsewhere and you get the music benefit, you get the Prime Gaming benefit and you get the photos benefit and you get the Buy with Prime capability, use your Prime subscription on websites beyond just Amazon and some of the grocery benefits that we provide, and RxPass like we just launched to get a number of medications people take regularly for $5 a month unlimited, that is remarkable value that you just don't find elsewhere. And we will continue to add things to Prime and continue to experiment with lots of different features and benefits. But it's still early days.",
"And as we continue to make the service better and better and fully featured, we see people continuing to spend more at Amazon across our various businesses. So we're optimistic about it."
]
},
{
"name": "Operator",
"speech": [
"And our final question comes from Mark Mahaney with Evercore ISI. Please proceed with your question."
]
},
{
"name": "Mark Mahaney",
"speech": [
"Thanks. Two questions. Brian, just any color on why mid-teens is kind of a holdable growth rate for AWS over the next couple of quarters, given what looks like pretty clearly, continuing deterioration in enterprise demand? And then, Andy, I wonder at a high level if you could just talk about how your priorities may have changed or the company's priorities may have changed over the last year or so as you've been the CEO. And it looks like there's a bit of a peel back on devices, a peel back on physical stores, except for groceries, and then maybe a little bit more of a lean in on health.",
"And I'm not quite sure what you're doing with entertainment content spend like that. Maybe it's the same, maybe it's a little bit more. But just at a high level, how would you say your priorities have changed or are different than the prior CEOs? Thank you."
]
},
{
"name": "Brian Olsavsky",
"speech": [
"Hi, Mark. So on the AWS growth rate, I'm not sure I can forecast for you with any level of certainty what is going to happen beyond this quarter. You kind of -- this is a bit uncharted territories economically. And as we mentioned, there's some unique things going on with the customer base that I think many in this industry are all seeing the same thing.",
"So I don't have a crystal ball on that one, but we are going to continue to work for to be there for our customers. And as I said in the earlier comments, we do have new deals. We have new workloads coming to the cloud. The value was there.",
"And whether there's short term, perhaps short-term belt tightening in the infrastructure expense by a lot of companies, I think the long-term trends are still there. And I think the quickest way to save money is to get to the cloud, quite frankly. So there's a lot of long-term positive in tough economic times. Saw that in 2020 when volumes for customers shifted very quickly.",
"It led to a resurgence after that and probably acceleration of people's journeys to the cloud, and we'll just have to see if that happens again with what we're seeing today."
]
},
{
"name": "Andy Jassy",
"speech": [
"Yes. I would say I think for any leadership team, each era is different, and it's often meaningfully impacted by what's happening around you. And I think that if you look at the last couple of years with things like the pandemic and the labor shortage in 2021 and the war in Ukraine and inflation and uncertain economy, good leadership teams look around and try to figure out what that means and how they should adjust their businesses. And so if you look at -- in the early part of 2022, I think we realized that as we tried to make sure we met the surge in demand for consumers and sellers and having to make decisions in 2020 for what fulfillment network investments we're going to make in 2022, we just had more capacity than we needed.",
"And you saw us in the early part of 2022 delay some of our builds and mothballed some of our facilities to try and be more economic. And I think when we look at some of our physical business investments, physical store investments, I think there were just some areas where we didn't have conviction that they were going to be big needle movers for Amazon. And so that's why we closed down our 4-Star bookstores. And as we got into the early part of the summer, where we start our operating planning process, we -- and there was a lot of things happening in the macro economy, we started that process with the high-level tenet of we want to find a way to meaningfully streamline our costs in all of our businesses, not just their existing large businesses, but also in some of the investments we're making.",
"We want to actually do a pretty good, thorough look about what we're investing and how much we think we need to, but doing so without having to give up our ability to invest in the key long-term strategic investments that we think could change broad customer experiences and change Amazon over time. And you saw that process led to us choosing to pause on incremental headcount as we tried to assess what was happening in the economy, and we eliminated some programs in fabric.com and Amazon Care and Amazon Glo, and Amazon Explore. We decided to go slower on some -- on the physical store expansion in the grocery space until we had a format that we really believed in rolling out and we went a little bit slower on some devices, and until we made the very hard decision that Brian talked about earlier, which was the hardest decision I think we've all been a part of, which was to reduce or eliminate 18,000 roles. And so those were all done with an eye toward trying to streamline our cost but still be able to invest in the things that we think really matter over the long term.",
"Now we have a way of looking at investments that is different maybe from some other companies. I'm not saying it's right or wrong. It's just the way we look at it, which is when we think about big areas to invest in, we ask ourselves a few questions. We ask, if we were successful, could it really be big and move the needle at Amazon, which is a high bar at a place like Amazon? Do we think it's being well served today? Do we have a differentiated approach? And do we have some competence in those areas? And if we don't, can we acquire them quickly? And if we like the answers to those questions, we will invest.",
"Sometimes, that leads to very logical extensions for people. When I got to Amazon 25 years ago, we were a books-only retailer. And when we expanded into music and video and electronics, that seemed pretty natural to people. Amazingly, people were very surprised we were expanding into tools.",
"That seemed far field for people, but it turned out not to be. When we launch something like Buy with Prime, I think people see that as more predictable. That process has also led us to less predictable investments. And I remember, I had a front-row seat in the AWS experience, having worked with the team and led the team from the very start.",
"And I remember both externally and internally, there were a number of people who wondered why we were doing that. It was so different from retail only. But think about how different a company Amazon would be today if we hadn't invested in AWS. And so that informs some of the other meaningful investments we're making beyond our stores, in retail and advertising, and AWS businesses.",
"I think that while we've gone slower in some devices and things, we still -- when we look at the answers to those four questions, we are very enthusiastic about our investments in streaming entertainment devices, our low Earth orbit satellite, and Kuiper, healthcare and a few other things. And I think that do I think every one of our new investments will be successful? History would say that that would be a long shot. However, it only takes one or two of them becoming the fourth pillar for Amazon for us to be a very different company over time. So I think it's very worthwhile.",
"We're going to continue to invest. We're going to be very thoughtful about how we streamline our costs, and I think you see a lot of that, but we're also going to continue to invest for the long term."
]
},
{
"name": "Dave Fildes",
"speech": [
"Thank you for joining us today on the call and for your questions. A replay will be available on our Investor Relations website for at least three months. We appreciate your interest in Amazon, and we look forward to talking with you again next quarter."
]
}
] |
AMT
|
2019-02-27
|
[
{
"description": "Senior Director, Investor Relations",
"name": "Igor Khislavsky",
"position": "Executive"
},
{
"description": "Chairman, President, and Chief Executive Officer",
"name": "James D. Taiclet, Jr.",
"position": "Executive"
},
{
"description": "Executive Vice President and Chief Financial Officer",
"name": "Thomas A. Bartlett",
"position": "Executive"
},
{
"description": "Deutsche Bank -- Director",
"name": "Matthew Niknam",
"position": "Executive"
},
{
"description": "Raymond James -- Managing Director",
"name": "Ric Prentiss",
"position": "Executive"
},
{
"description": "UBS -- Analyst",
"name": "Batya Levi",
"position": "Analyst"
},
{
"description": "Morgan Stanley -- Managing Director",
"name": "Simon Flannery",
"position": "Executive"
},
{
"description": "Macquarie Bank -- Analyst",
"name": "Amy Yong",
"position": "Analyst"
},
{
"description": "KeyBanc Capital Markets -- Analyst",
"name": "Brandon Nispel",
"position": "Analyst"
}
] |
[
{
"name": "Operator",
"speech": [
"Ladies and gentlemen, thank you for standing by. Welcome to the American Tower Fourth Quarter and Full Year 2018 Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session. Now, if you've given the operator your name already, you may press *1 for questions. We ask that you please limit yourselves to one question per queue. If you wish to ask a second question, please requeue. All other participants: If you have not given the operator your name, please press *0 at any time to give the operator your information for the Q&A session. As a reminder, this call is being recorded. Your hosting speaker today: Igor Khislavsky. Please go ahead, sir."
]
},
{
"name": "Igor Khislavsky",
"speech": [
"Thanks, Kevin. Good morning and thank you for joining American Tower's Fourth Quarter and Full Year 2018 Earnings Conference Call. We've posted a presentation, which we'll refer to throughout our prepared remarks, under the Investor Relations tab of our website, www.americantower.com.",
"Our agenda for this morning's call will be as follows: First, I will provide a few highlights from our financial results for the quarter and full year 2018. Next, Jim Taiclet, our Chairman, President, and CEO, will provide a brief update on our Stand and Deliver strategy and our key priorities for 2019. And finally, Tom Bartlett, our Executive Vice President and CFO, will provide a more detailed review of our 2018 results and 2019 outlook. After these comments, we'll open up the call for your questions.",
"Before I begin, I'll remind you that this call will contain forward-looking statements that involve a number of risks and uncertainties. Examples of these statements include our expectations regarding future growth, including our 2019 outlook, capital allocation, and future operating performance, the pacing and magnitude of the Indian carrier consolidation process and its impacts on American Tower, and any other statements regarding matters that are not historical fact.",
"You should be aware that certain factors may affect us in the future and could cause actual results to differ materially from those expressed in these forward-looking statements. Such factors include the risk factors set forth in this morning's earnings press release, those set forth in our Form 10-K for the year ended December 31st, 2017, as updated in our Form 10-Q for the quarter ended June 30th, 2018, and in other filings we make with the SEC. We urge you to consider these factors and remind you that we undertake no obligation to update the information contained in this call to reflect subsequent events or circumstances.",
"Now, please turn to Slide 4 of our presentation, which highlights our financial results for the fourth quarter and full year. Both periods were positively impacted by our settlement with Tata, partially offset by the negative impacts of Indian carrier consolidation-driven churn. During the quarter, our property revenue grew 25.3% to $2.1 billion, our adjusted EBITDA grew more than 38% to $1.4 billion, and our consolidated AFFO and consolidated AFFO per share increased by about 51% and 46% to $1.07 billion and $2.40 respectively. Finally, net income attributable to American Tower Corporation common stock holders increased by 26.4% to $278 million, or $0.62 per diluted common share.",
"From a full-year perspective, our property revenue grew 11.4% to $7.3 billion, our adjusted EBITDA grew more than 14% to $4.7 billion, and our consolidated AFFO grew by 22% to over $3.5 billion, while consolidated AFFO per share rose by nearly 19% to $7.99. Finally, net income attributable to American Tower Corporation common stock holders increased by 6.6% to more than $1.2 billion for the year, or $2.77 per diluted common share.",
"Before turning the call over to Jim, I also want to note that many of our comments around the fourth-quarter and full-year 2018 results and our 2019 outlook will be focused on growth rates normalized for the impacts of both the Tata settlement and the carrier consolidation-driven churn in India. We view these normalized results as important indicators of the underlying trends of the business. We've included reconciliations of these normalized metrics to our GAAP results in the back of our earnings presentation, in our press release, and in our supplemental package. And, with that, I'll turn the call over to Jim."
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"Thanks, Igor, and good morning to everybody on the call today. My comments will center on two topics: Our early progress on the Stand and Deliver 10-year strategic plan that I announced last year and our specific priorities there for 2019. But first, I'll quickly touch on our 2018 results and a few highlights.",
"2018 was another year of strong organic growth for American Tower, particularly in the U.S., as well as disciplined portfolio expansion and continuously improving operational execution. All these factors resulted in double-digit growth and consolidated AFFO per share for the 11th consecutive year. Notably, throughout 2018, our business performed at a high level despite increased macroeconomic, political, and capital markets volatility.",
"I believe this resiliency is a reflection of several things: First, the fundamental driver of our business globally is the continued advancement of mobile technology from 2G through 3G and 4G, ultimately to 5G, and the related expansion in the number of highly capable smartphones and other devices along with the corresponding growth in mobile data usage on those devices. Second, we've made a concerted effort over the last 15-plus years to enhance the resiliency embedded within the business model through our innovative contract structures, prudent balance sheet management, diversification strategy, and many other areas. Over the next decade, we expect to use our Stand and Deliver strategy to continue to augment that resiliency while driving attractive growth and returns for our shareholders. The balance of my remarks today will center on a short overview of our progress in year one of our strategy and our priorities for 2019.",
"The first focus area of Stand and Deliver is to drive operational efficiency throughout the business, and even throughout the industry. This includes improving the experience for both our tenants through site-level enhancements and process improvements while expanding our margins. In 2018, we continued to drive cycle times down to enable tenants to get onto our sites as fast as possible, which also starts the billing cycle as fast as possible. We also invested more than $30 million in green energy solutions such as advanced batteries, solar installations, and other initiatives, primarily in our African markets, as we sought to optimize the fuel management component of our business there.",
"Not only do these investments have the potential to drive significant efficiencies for us and the broader industry as well, they're also helping us reduce our carbon footprint. Meanwhile, in our foundational U.S. business, the benefits of our strong revenue growth paired with our cost controls and operating efficiency led to cash gross margins that were approximately 80 basis points higher than 2017.",
"The second platform for Stand and Deliver is to grow our portfolio and capabilities across our served markets. In 2018, we added more than 24,000 sites through acquisitions and new builds and entered Kenya as our 17th market. We're well on our way to integrating these new assets into our comprehensive global portfolio and systems, and as always, these investments were made utilizing our proven return-based capital allocation methodology, which has enabled us to build an unmatched and highly diversified global portfolio over the last two decades.",
"A focus on innovation is the third component of our Stand and Deliver strategy, and while we are still in the early stages of our innovation initiative, 2018 yielded some tangible progress toward our long-term goals. Our fiber-related assets in Latin America and South Africa, for example, are today generating cash flow, driving colocation on our newly fiber-connected towers there, and helping position us to benefit from small-cell-driven densification in urban areas like Sao Paolo and Mexico City.",
"Earlier-stage projects are also under way, and include everything, from EDGE data centers to a potentially significant expansion of our in-building coverage capabilities through CBRS spectrum, to exploring a possible role in future autonomous driving and drone control networks. In all cases, we're looking for business models that are either based upon or complementary to our existing macro towers. Our innovation initiatives are pursued within the framework of the franchise real estate characteristics that made our existing operations so durable and profitable over the long term. These are commercially sharable assets, long-term contracts, and high operating leverage.",
"And, the final element of Stand and Deliver is our commitment to enhancing American Tower's industry leadership as the only true global mobile infrastructure provider to best support our existing and new customers as we enter a 5G future. For example, we're working with leading universities in the field of distributive power generation and power management to optimize site uptime, to minimize ongoing energy costs, and potentially dramatically reduce the mobile industry's carbon footprint in emerging markets by replacing or minimizing the runtime of diesel generators. Furthermore, as I mentioned earlier, we're actively implementing these kinds of solutions already in our major African markets and in India, resulting in a material reduction in our generator runtimes already in 2018.",
"From a broader perspective, we worked closely in 2018 with several nongovernment organizations and government bodies to bring the transformational capabilities of mobile broadband to more and more people. In addition to expanding our digital village concept in India, we have now brought that solution to Nigeria and have begun deployments in Latin America as well.",
"In 2019, we expect to continue to make progress on the Stand and Deliver strategy in all the areas I just mentioned, and within that general objective, there are several particular items of note. First, as you may have seen in the 2019 outlook we issued this morning, we expect another very strong year of new leasing business in the U.S., with organic tenant billings growth of approximately 7%. To turbocharge that robust demand trend that drives our top line, we're also continuing our efforts on the operational efficiency front in the U.S. market. This includes initiatives to drive down maintenance expenses and a continued focus on using the latest technology to capture and organize all relevant site-level lease data and the structural engineering characteristics of our towers. We're then leveraging that data mining to inform our commercial, operational, and engineering decision-making.",
"In our international markets, we have several key points of emphasis. In India, we're focused on managing through the latter stages of the carrier consolidation process and positioning our business there for attractive long-term growth, which we expect to occur. In Africa, we expect to make meaningful investments in fuel management in 2019 while continuing to selectively look for new assets and drive colocation and build-to-suit opportunities with key regional customers. And, in Latin America, we're focused on capitalizing on the current 4G buildouts occurring across the region.",
"From a corporate perspective, we expect to further strengthen our balance sheet in 2019 as part of our continuing commitment to our investment-grade credit rating. Maintaining strong liquidity, opportunistically turning out floating-rate borrowings into fixed-rate instruments, and selective debt retirement and refinancings along the way are all potential components of this strategy in 2019.",
"Simultaneously, we expect to grow our dividend by around 20%, subject to our board discretion, and continue to view that dividend as a critical component of our return profile. Finally, we anticipate deploying additional discretionary capital toward a combination of site development and construction, acquisitions, and share repurchases consistent with our long-term return criteria.",
"In closing, everyone here at American Tower is proud of our long track record of delivering results and even more energized about taking advantage of our unique position in the industry to lead the way into a 5G future. With that, I'll turn it over to Tom to take you through our 2018 results and detailed outlook for 2019."
]
},
{
"name": "Thomas A. Bartlett",
"speech": [
"Thanks, Jim. Good morning, everyone. As you can see, we finished 2018 really strong, with Q4 U.S. organic tenant billings growth of 8%, the receipt of nearly $350 million in cash from Tata as part of our settlement agreement in India, and with solid results throughout our Latin America and EMEA markets. During the year, we deployed over $4 billion in capital, including $1.9 billion for acquisitions, adding over 22,000 new sites, nearly $940 million from CapEx inclusive of approximately $255 million to build over 2,000 new sites, over $230 million to repurchase about $1.6 million shares of common stock, and $1.4 billion to grow our common stock dividend by over 20%, extending our long track record of consistent dividend increases.",
"And, as Igor highlighted, we again generated double-digit increases across our key metrics, closing out another solid year for American Tower. Given our high-quality asset base and consistent focus on portfolio diversification, innovation, and operational efficiency, we expect 2019 to be another year of strong performance, but before we get into our 2019 outlook, let me quickly discuss our financial and operating results for 2018.",
"If you'll please turn to Slide 6, for the full year, we generated organic tenant billings growth normalized for the impact of India carrier consolidation-driven churn and the Tata settlement of 7.5% on a consolidated basis. Almost 6% of this was driven by volume growth from gross new business throughout our geographic footprint.",
"Our reported U.S. property segment revenue growth for the year was about 6%, including a negative impact of 2.6% from lower noncash, straight-line revenue recognition. U.S. organic tenant billings growth, which was largely amendment-driven, was 7.3%, the highest since 2014, and a figure that we believe clearly led our industry. Volume growth from colocations and amendments contributed 5.6% to the full-year growth rate while pricing escalators contributed just over 3%, and this was partially offset by churn of about 1.3% and an impact of less than 20 basis points from some other items.",
"Major U.S. wireless carriers made significant network investments throughout the year to keep pace with mobile data usage that experts say continues to grow at 30-40% annually, which drove record levels of new business for American Tower. In fact, we exceeded the prior U.S. record set in 2014 for new business run rate additions by over 14% on a per-site basis and added almost 70% more new business run rate in 2018 than the prior year.",
"Our reported international property revenue growth for the year was about 18%, underpinned by normalized organic tenant billings growth of approximately 8%. Our growth internationally was supported by significant network spending by tenants across our footprint, especially in key markets like Mexico, Brazil, and South Africa. While the mix of colocation amendments varied by market overall, colocation amendment revenue drove nearly 6% of the growth while escalators contributed another 4.2%. Other run rate items added 0.6%. This was partially offset by normal due-course churn of around 2.6%.",
"And finally, the day one revenue associated with the more than 24,000 sites we added over the course of the year last year contributed another 3.5% to our global tenant billings growth. These new assets included our acquisition of approximately 20,000 sites from Idea and Vodafone in India as well as over 2,400 newly constructed sites, primarily in our international markets, where average day one NOI yields were approximately 10%.",
"Turning to Slide 7, we also generated solid adjusted EBITDA and consolidated AFFO growth in 2018, driven by strong revenue growth as well as diligent management of operating and interest expenses, maintenance CapEx, and interest and taxes. As expected, our results also benefited from the Tata settlement recognized in Q4. For the year, adjusted EBITDA grew by more than 14%, with our adjusted EBITDA margin increasing to nearly 63%. On a normalized basis, adjusted EBITDA growth was nearly 9%, with a margin of over 61%. Notably, on an FX-neutral basis, we exceeded our initial 2018 outlook for normalized adjusted EBITDA by over $110 million.",
"We also drove double-digit consolidated-AFFO and AFFO-per-share growth for the 11th consecutive year. Consolidated AFFO grew about 22% and consolidated AFFO per share grew nearly 19% to $7.99, while AFFO attributable to common stock holders grew around 17%, or roughly 14% per share. On a normalized basis, consolidated AFFO and consolidated AFFO per share grew over 14% and 11% respectively, and after further adjusting for FX, we outperformed our initial outlook for consolidated AFFO by about $115 million, or $0.20 per share.",
"Now, turning to Slide 8, let's now take a look at our expectations for 2019. As we've discussed for the last year or so, the Indian wireless market -- and with it, our Indian tower business -- is in the latter stages of a rapid transformation, which we expect to be a clear long-term positive. With that said, and as we've been communicating, in the immediate term, net transformation is impacting our expectations for 2019 as 2018 churn events flow into our reported results.",
"As you can see, we've laid out the property revenue impacts of this related consolidation churn on the slide, and have included similar bridges for your reference for adjusted EBITDA and consolidated AFFO later in the deck. Given the short-term nature of this event, I'll focus the rest of my comments regarding our 2019 expectations on the underlying core trends of the business, which we have labeled as normalized within the slides. The normalized reconciliations are also in the deck's appendix.",
"At the midpoint of our outlook, we expect to generate over $7.2 billion of property revenue in 2019. Normalized consolidated property revenue is planned to rise by nearly 6%, including nearly $630 million in FX-neutral property revenue growth, supported by record contributions from colocations and amendments. Our U.S. property revenue is expected to grow by about 4%, including a roughly 3% negative impact from noncash straight-line recognition, while our anticipated international property revenue growth is over 8% on a normalized basis. This 8% includes a $105 million or 3% negative impact of unfavorable FX translation.",
"Flipping to Slide 9, we expect organic new business to be the primary driver of growth across our global footprint in 2019, supported by multiple simultaneous network initiatives from the large multinational tenants that comprise a majority of our revenue base. In the U.S., we're projecting organic tenant billings growth of around 7% as carrier spending on 4G continues and 5G-related activity begins to accelerate. On a dollar basis, we expect that the contribution of new business to our organic growth in 2019 will exceed the record levels we saw in 2018, further illustrating the quality of our portfolio and the strength of our contracts. Further, we continue to view the underlying drivers of demand in the U.S. as multiyear in nature, which would yield continued strong growth beyond 2019.",
"In Latin America, we expect organic tenant billings growth of between 7-8% for the year. Demand trends in the region remain strong, with carriers focusing on improving and extending 4G networks as advanced devices increasingly enter the marketplace. Additionally, after some volatility around recent elections in several of our larger markets in the region, the macroeconomic and currencies in those markets appear to have stabilized, which we would view as an incremental positive.",
"With that said, compared to 2018, our 2019 Latin America organic tenant billings growth rate is expected to be lower, primarily as a result of lower CPI escalators and slightly higher expected churn spilling over from 2018. Interestingly, we expect new business run rate additions to increase by about 10% over the prior year, but we expect new business contribution to organic tenant billings will be about 14% lower due to the timing of these commitments. Over the longer term, we believe we'll have excellent opportunities to build on these expectations as carrier investments continue. In addition, we're excited about our Latin America build-to-suit program in 2019, given the acceleration of network densification needs for 4G in the region. Specifically, our outlook implies that new builds in Latin America will increase by more than 50% versus last year.",
"2019 organic tenant billings growth in EMEA is expected to be around 6%, down slightly from 2018. Similar to Latin America, while new business additions are expected to be higher overall, we anticipate marginally lower CPI-linked escalators and slightly higher churn in the region. I'd also note that we expect organic growth to gradually accelerate over the course of the year, particularly in our largest EMEA market, Nigeria. Looking slightly longer-term is our EMEA market's progress with 4G network deployments. We would expect demand trends to further recover. We think we may be seeing the leading edge of that trend in the new build side, where we would expect the total number of new builds in EMEA to rise by well over 50% from 2018 levels.",
"And finally, we expect our Asia results in 2019 to again include impact from India carrier consolidation-driven churn. By the end of 2019, however, we expect that most of the redundant legacy 2G equipment resulting from carrier consolidation will be removed from our sites, and carriers will be focused on building out nationwide 4G networks across the market. Notably, our continuing tenant leases in India have an average remaining term of over four years, similar to that of our U.S. business. Given this extended contract length and the level of investment needed to deploy 4G over the next several years, we expect future due-course churn in India to be below historical levels of 3-4%.",
"Further, we are seeing evidence that the recovery and investment in the market is beginning to take hold. During 2019, we expect the new business contribution on a per-site basis will increase over 15% from the prior year. By the latter portion of 2019, we expect to be progressing significantly closer to the high single- to low double-digit organic tenant billings growth rates we have historically seen in India. Overall and on a normalized basis, we expect to see organic tenant billings growth of between 8-9% in India for 2019.",
"Moving on to Slide 10, at the midpoint of our outlook, we expect to generate just under $4.5 billion of adjusted EBITDA. Normalized adjusted EBITDA is planned to grow by nearly $280 million, or over 6%. This reflects the strong growth trends we are seeing throughout our business as well as the significant operating leverage inherent in the tower model based on the fixed-cost nature of the business. This also reflects the benefits of the power and fuel investments we've made across our markets in Africa, and we expect these investments to drive measurable benefits to our margins during 2019.",
"Further, we anticipate that SG&A as a percent of revenue will decline slightly to be around 7.5% on a normalized basis, representing the lowest level in at least a decade. Finally, our normalized adjusted EBITDA expectations include an estimated negative impact of around $45 million from unfavorable FX translation effects and a $75 million impact from lower net straight-line recognition, excluding the straight-line impact associated with the Tata settlement.",
"Looking at Slide 11, we expect to translate our solid underlying trends in adjusted EBITDA to strong normalized consolidated AFFO growth. At the midpoint of our outlook, we expect to earn over $3.4 billion of consolidated AFFO, generating $7.70 a share. Normalized consolidated AFFO is planned to grow by a total of nearly $320 million, or roughly 10%. As compared to 2018, this includes an FX-neutral incremental contribution of nearly $400 million from cash-adjusted EBITDA, partially offset by $47 million or so in slightly higher capital improvement CapEx, interest expense, and cash taxes, as well as roughly $35 million from unfavorable FX trends.",
"On a per-share basis, we expect normalized consolidated AFFO growth to be over 9% for the year. These solid growth rates illustrate not only our focus on operational efficiency throughout the business, but also our prudent balance sheet management and selective accretive investments. In fact, we expect to convert adjusted EBITDA to consolidate AFFO at a rate of over 90% at the midpoint of our normalized outlook.",
"Looking at Slide 12, we remain committed to our long-held return-based diverse capital allocation strategy. In 2018, we deployed about $1.4 billion for our growing common stock dividend as well as over $230 million to repurchase common stock. We also allocated nearly $940 million of CapEx, over half of which was utilized for a combination of new site builds, primarily in our international markets, where the initial NOI yields continue to be in the double digits, and to add incremental capacity to existing sites to support colocation.",
"Finally, we spent nearly $2 billion on new assets, primarily in our international markets, to help expand the recurring cash flow generation of the business. We expect to deploy capital in a similarly balanced manner in 2019, including about $950 million at the midpoint of our outlook for capital expenditures, with over half of this again dedicated to increasing site capacity and building new sites.",
"Our common stock dividend is planned to grow by 20% or so to $1.7 billion, subject to board discretion, and we also anticipate spending around $800 million to increase our stake in our India business through the purchase of the Tata and IDFC put options, which will raise our AFFO attributable to common stockholders. As we alluded to last quarter, we also continue to evaluate the potential of bringing a financial partner on board in India as a way to further diversify our capital sources.",
"Our capital allocation strategy has hinged on our underlying commitment to maintain leverage in the 3-5x range. This diverse capital allocation strategy, coupled with the strict return criteria embedded in our investment methodology, has been the foundation of our ability to cultivate a diverse, expansive footprint of mission-critical communications infrastructure across the globe. That discipline is evident in our long-term track record of delivering solid organic growth year in and year out, and the declining capital intensity of our business, and consequently to the expansion in our return on invested capital. As you can see in this slide, these positive trends continued in 2018.",
"Since 2014, we've increased our consolidated AFFO per share on an annual compounded basis by over 15% and increased our return on invested capital by about 1.4%, while at the same time more than doubling our site count, expanding into five new markets and further diversifying our business through our innovation program.",
"Slide 13 highlights our tremendous levels of sustained new business growth we've been able to generate and the corresponding increases in our contracted non-cancelable revenue base. These increases are directly attributable to our aforementioned disciplined investment methodology as well as our innovative approach to contract optimization. Over the last five years, our annual organic new business additions have grown at an average rate of over 9%, adding approximately $1.2 billion to our run rate. This has been driven by the compelling secular growth in wireless, our intense focus on offering class-leading service to our tenants, and of course, our high-quality global portfolio and internal focus on operational efficiency.",
"Taken together, we believe that these attributes have elevated our organization to a preferred provider status with many of the leading multinational mobile operators around the globe, as evidenced by our results. Going forward, we believe we're optimally positioned to continue to drive strong levels of new business throughout our diverse footprint, and we've been able to leverage this strong organic growth -- as well as selective M&A -- to steadily expand our contracted non-cancelable revenue base, which stood at approximately $35 billion as of the end of 2018. This book of non-cancelable revenue gives us significant visibility into our future cash flows and performance and facilitates a long-term strategic view with regard to our investments.",
"Turning to Slide 14 and in summary, as I mentioned, 2018 was another strong year for American Tower, with solid organic growth, particularly in the U.S., where we reached 8% organic tenant billings growth in the fourth quarter for the first time since 2014. We also made significant progress managing through the carrier consolidation in India and expect to return to high single- to low double-digit organic tenant billings growth there in 2020 and beyond. Compelling demand trends coupled with diligent operating expense management enabled us to drive strong adjusted EBITDA and consolidated AFFO, with 2018 marking our 11th consecutive year of double-digit consolidated-AFFO-per-share growth.",
"Looking to 2019, we expect another solid year of new business across our portfolio. We again anticipate leading the industry with respect to organic growth in the U.S. and believe we are well positioned on a global basis to take advantage of the substantial investments being made by our tenants on their mobile networks. We are again targeting dividend growth of at least 20% in 2019, subject to discretion of the board, and continue to be prepared to simultaneously make selective investments in growth to help fuel our future performance.",
"Looking slightly longer-term, we remain committed to our Stand and Deliver strategy and our innovation program, and expect that these initiatives, coupled with our high-quality global asset base, will position us well to meet the wireless connectivity needs of the future while maximizing shareholder returns for many years to come. And, with that, I'll turn the call over to the operator so we can take some questions."
]
}
] |
[
{
"name": "Operator",
"speech": [
"Thank you. Ladies and gentlemen, if you wish to ask a question and you've already given the operator your name, you may press *1 at any time. If you have not given an operator your information, please press *0 and give the operator your name. They will instruct you one step further. Once again, if you've already given the operator your name, you may press *1 at any time. The first question in queue is Matt Niknam, Deutsche Bank. Please go ahead."
]
},
{
"name": "Matthew Niknam",
"speech": [
"Hey, guys. Thank you for taking the question, and congrats on the quarter. So, my question is on the U.S. Can you give us any more color on what drove the acceleration this quarter in organic billings trends, specifically around the nice pick-up in colo and amendment activity? And then, what are some of the underlying assumptions around the '19 outlook, particularly around activity from both Sprint and T-Mobile? Thanks."
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"Matt, it's Jim. The quarterly results we had that were so strong are really endemic of a long-term trend in U.S. wireless. So, a few years ago -- and, we've updated this -- we did a regression analysis at American Tower that correlated our organic growth to 20 or so independent variables, and we tried to tease out which of those variables were the two or three most important ones with the highest R-squared. And so, what we've derived from that were really top two that drove the answer. One was aggregate industry mobile data volume in the U.S. -- so, depending on whether there were six, five, four, or three carriers, how many gigabits per month were going through the mobile network -- the physical mobile network, and that's been going on at a 30-40% rate increase per annum all through this recent three to five years.",
"What happens as a result of that in the field is that there's really three outcomes. One is the equipment per site goes up because there's just a larger volume of data going through the sites, and that's one way to handle that data volume. Secondly, there's additional spectrum bands added. That has two ramifications. One is there's more equipment -- again, usually added to specific spectrum bands to optimize their performance. When you put the spectrum band on, you have an optimal size of antenna that goes with it, and often, those are added. But secondly, the higher-spectrum bands also drives density requirement, so that's where some of the colocations come in -- when higher-density bands or volume come in and cause cell splits.",
"And then, the last piece of it, which is helpful to us because we have a large in-building footprint in the industry, is that when the data volume goes up that dramatically, offload in buildings with either DAS systems or other technologies more valuable. So, that's one big driver, is just aggregate data volume, and it occurred again in 2018, and it drove a lot of our new business growth.",
"Second higher R-squared correlation was total carrier mobile CapEx, and it was at or above $30 billion by our estimate last year. We expect it to be about the same this year, and that has historically -- for our company -- led to mid to high single-digit organic tenant billings growth. So, it's really those two trends manifesting themselves, whether it was the quarter or the year 2018, and we don't really see those trends abating much in 2019."
]
},
{
"name": "Thomas A. Bartlett",
"speech": [
"And, Matt, just to give the math going into 2019, the application pipeline remains really strong, and it was strong across the board throughout 2018, very strong in Q4, and we see that continuing in 2019, largely amendment-driven, as Jim talked about. So, roughly 80% is amendment-driven versus 20% colo. Amendments -- what we're seeing -- are in that $800.00-900.00 range. So, we're looking for a reported 4% with that 3% straight-line decline, so, roughly a 7% growth in our U.S. business. What's interesting is that we actually expect to see higher new business from colo and amendment additions to organic growth in '19 versus '18, and if you actually take a look at just the fact that we're coming off of a higher base at the end of '18 versus coming off '17, it actually had a negative impact of 50 basis points on the organic growth rate.",
"So, if you look at the 7% organic growth rate, on the same base, it would be 50 basis points higher. And, the churn is in the same kind of 1.5 -- middle between 1-2%, so, pretty consistent with where we've seen it in the past. Escalators just over 3.1%. So, we're really excited about what we're seeing in the U.S. business, our U.S. team is really excited to drive another year, we think it will again lead the market relative to core organic growth, and so, it's really going to underpin the rate of growth that we're seeing in the consolidated business."
]
},
{
"name": "Matthew Niknam",
"speech": [
"And, just to circle up, I don't think there's any real assumption based on carrier consolidation or a slowdown in activity that's baked into the '19 outlook in the U.S."
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"No. We didn't put any kind of U.S. industry consolidation either way in the 2019 outlook that Tom just talked about."
]
},
{
"name": "Thomas A. Bartlett",
"speech": [
"Keep in mind, that does still have long-term contracts in place, and so, we wouldn't expect to see much activity relative to that event in 2019."
]
},
{
"name": "Matthew Niknam",
"speech": [
"Great. Thank you."
]
},
{
"name": "Operator",
"speech": [
"Next, we have Ric Prentiss, Raymond. Please go ahead."
]
},
{
"name": "Ric Prentiss",
"speech": [
"Good morning, guys. I want to follow up on Matt's questions a little bit there. One of the other items in the U.S. has the other -- you mentioned industry-leading. What do you think the others in the industry are seeing as a required network churn from Metro, Clearwire, and Leap, and those transactions occurred back in 2013-2014? Do you expect to have churn from those guys at some point this next decade? Just trying to figure out when that might come in."
]
},
{
"name": "Thomas A. Bartlett",
"speech": [
"We will continue to see that over the next several years, Ric, but it's all within that 1-2% churn rate that we've talked about."
]
},
{
"name": "Ric Prentiss",
"speech": [
"Okay. And then, Jim, you talked about IDAS a couple of times now. You talked about it in the regression analysis; also, early on, you talked about the potential for CBRS spectrum. Can you help us understand a little bit about the size, what that opportunity might be like, and the timing of it?"
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"Sure. So, our team in the U.S. -- under current technology and the related costs that go with it -- feels like there's about 2,000 interior structures that qualify for the level of investment required to do -- we'll call it traditional indoor distributed antenna systems. So, we're in the very early stage of trying to figure out how can we dramatically increase the addressable market of in-building, and we've got a couple of approaches to that. Something we call carrier-grade Wi-Fi is one, CBRS spectrum deployment to reduce the fiber investment inside of buildings.",
"Another one -- millimeter-wave spectrum that some carriers have access to that we could work with or we could get some access to that could be a third way. So, we're just now -- in our innovation team -- doing trials, some with customers, actually, to try to figure out is there a way to take the 2,000 buildings to 100,000 by having the cost of the installation and operation go down and the spectrum requirement go down as far as cost in a way that you can really dramatically upscale the addressable market. But, this is early days, and it's something that we're looking at our long-term plan to help bolster."
]
},
{
"name": "Ric Prentiss",
"speech": [
"So, nothing really in the '19 budget other than the trials and seeing how it could attack, and then, it might be the next-decade-type thing?"
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"Next five to 10 years, if it scales. That would be one of the product roadmaps that we're pursuing. And then, our innovation program, Ric -- because there's some uncertainty and these are longer-term projects, we have a number of these roadmaps that we're pursuing, and some of them will scale, we hope, and others may not, but we have a diverse approach to this like we've had a diverse approach to our international expansion in 2007 and beyond, so we're putting a number of small investments out there to try to build a business model with customers that then can scale."
]
},
{
"name": "Ric Prentiss",
"speech": [
"Great. Thank you, guys."
]
},
{
"name": "Operator",
"speech": [
"Next question is from the line of Batya Levi, UBS. Please go ahead."
]
},
{
"name": "Batya Levi",
"speech": [
"Great, thank you. Just one follow-up on the U.S. When you look at your outlook for incremental EBITDA versus the new revenue, it looks like the conversion margin is a little bit lower. Is there anything to call out there? And then, in Latin America, you mentioned some of the drivers of the slowdown. Can you provide a bit more color on the magnitude of the churn and where that's coming from, and then, how the new business is actually trending in Mexico and Brazil? Thank you."
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"I think the biggest impact, probably, Batya, relative to the conversion rates in the U.S. is probably straight-line. So, I think if you back out the straight-line impacts, you'll continue to see those high rates of conversion, if you will, up in the 80-90% levels in the U.S. market, which have been consistent with some of the prior years. If you look down in Latin America, I think you'll see in the Mexico market, the growth is going to be up in the high single-digit 8-10% range, Brazil is probably a little bit lower, largely due to the escalators, and some of the incremental churn that we expected to occur relative, candidly, to Nextel and some of the other activities down in the marketplace we just haven't seen.",
"So, we're anticipating that some of that may rationalize in 2019, and have included that in our forecast. But, overall, as I said, the Latin America market is going to be generating more new business than it actually did in 2018, which is interesting -- as I mentioned in my remarks, the timing of those commencements in terms of where we're looking right now is contributing to the decline, if you will, in the overall organic growth in the market. But again, the teams down in Latin America are really excited about the levels of investments that are being made into those markets, and we expect another strong year down in LATAM."
]
},
{
"name": "Batya Levi",
"speech": [
"Okay, thank you."
]
},
{
"name": "Operator",
"speech": [
"And, next question is from the line of Simon Flannery, Morgan Stanley."
]
},
{
"name": "Simon Flannery",
"speech": [
"Good morning. Tom, you've mentioned about new builds -- Latin America and EMEA up about 50% each. Can you just dig into that a little bit more? How does that look versus the 2,400 you did in 2018? And then, any commentary on the M&A environment? Are you potentially looking at more deals or more countries? Thanks."
]
},
{
"name": "Thomas A. Bartlett",
"speech": [
"Sure, Simon. We have about 3,000 in the plane and are underpinning the forecast, as we talked about this morning. We continue to drive 100-150 per month in India, and what we're seeing in LATAM and EMEA is a lot of what we've seen starting over the last 12 months -- further densification. We've talked about in Brazil the fact that there are 50,000 sites, and we've always thought that they needed perhaps twice as many sites in that market, and I think we're now starting to see that level of investment activity from the carriers in markets like Brazil, and so, we're expecting to see 50% growth rates in those two markets -- LATAM and EMEA -- in 2019, so I think again, it just gets back to the level of investment that the carriers need to be making to continually drive 4G investment in the marketplace.",
"And so, Brazil is actually one of the higher-growth markets that we see in terms of new build-to-suits in the market, and as we've always mentioned, the build-to-suit program that we have is the best returning NOI yield that we've got in the business, so, to the extent that we see that even ramping throughout the year, we'll dedicate more CapEx to that."
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"And, on the M&A front, Simon -- it's Jim -- our primary objective is to deepen our position in our anchor markets, we'll call them -- so, the U.S., Brazil, Mexico, S.A. For example, last year, in India, we added to an anchor market we have there in Asia. That's got to get integrated, and some of the rest-of-the-industry consolidation is going to play out before you ever see us do anything else material there, but we would look there in the future, and then add some selected adjacent markets when we have common customers, et cetera, like we did with one last year in Kenya.",
"So, that's really how we're approaching this. We don't feel like we have to be doing, on one hand, dramatic inorganic growth to meet our business plan. On the other hand, we're continuously seeking accretive deals that meet our investment criteria, and when those appear and we can get them within our price point, you'll see us act. There's nothing to speak to today specifically, but we're maintaining that similar kind of approach."
]
},
{
"name": "Simon Flannery",
"speech": [
"That point on pricing -- is that a reference to some of the European prices? Is that still an area where you see better value elsewhere?"
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"It really references all regions, including the U.S. and Europe, which are lower ROIs, if you will, than some of the other countries as far as hurdle rates go. However, we've turned away what we think are high-priced deals in all the reasons I just talked about, so we're disciplined across the board. The fact of the matter, though, is that in Europe specifically -- to address that particular question -- there are what I'll call relatively new investors in the tower space that tend to come from infrastructure, pension funds, or insurance firms that maybe have different investment criteria than us, and until those rationalize a bit, it may be tough for us to get to some of these bigger deals."
]
},
{
"name": "Simon Flannery",
"speech": [
"Great. Thanks for the color."
]
},
{
"name": "Operator",
"speech": [
"Our next question is from the line of Amy Yong, Macquarie. Please go ahead."
]
},
{
"name": "Amy Yong",
"speech": [
"Thanks, and good morning. Maybe one on India. When we think about 2020 and beyond hitting normalized growth, what are some of your underlying assumptions around the health of the carriers? And then, on your comments on bringing a new partner, what's the thinking behind that? Is this a leverage issue, or something more on the operational side? Thanks."
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"Sure, Amy. It's Jim. First of all, let's just set the table with India here. There's a reordering going on in the mobile network architecture of that entire country and the 1.3 billion people it serves, and that reordering is going almost immediately from a 2G/3G hybrid network architecture to a full-up, 4G, national, billion-people-served topology for 4G. From an engineering perspective, that's a massive transformation that is going to happen. We're probably in the third inning of that now, which is the decommissioning of a lot of the 2G and 3G infrastructure that really doesn't fit in a 4G three- to four-carrier environment in India over the next seven or eight years.",
"So, we see the inflection point, as Tom suggested, in 2020, where now, we're into the fourth or fifth inning of this process and the investment has to come in for the rearchitecturing of this kind of a network, and even 5G is being talked about in India. So, that's where the underlying situation is, we think. And then, as far as the carrier health goes, this is an outcome that we've always expected, with there being three to four significant mobile operators in India because the network investment to get to that 4G architecture was going to be so substantial when you're trying to provide 10 gigabits a month to 1.3 billion people. So, we always expected this.",
"Our view of the health of each of those companies -- you can look at their own public statements, but we do think that Voda/Idea, with their merger -- which they're still integrating and need to continue to do -- has made a lot of progress toward positioning itself to achieve long-term growth, improving operating metrics, and both of the parent companies have sort of stepped up with capital commitments or other investment support that should enable this to occur. So, we are quite confident that with the three to four large carriers in India that are now in place, the industry will be able to get healthier in aggregate and financial performance will improve for all of them, but it will take a few years to get to that inflection point."
]
},
{
"name": "Thomas A. Bartlett",
"speech": [
"Amy, just underpinning -- and, to the second question that you had, underpinning this is really a market that we see in India that probably has about 600,000 leases overall from a number of different sources as well as our own internal engineering. We expect that to grow to over a million within the next several years, so that's really underpinning the underlying growth that we see in the marketplace. And, even if you take a look at 2018, and particularly in 2019, you take a look at our new business that we're generating in the market -- we'll generate more new business in 2019 than we did in 2018, and it's a steady growth. On a per-site basis, it's over 15% more.",
"So, we're really excited about what we're seeing, and as I mentioned in March, on a normalized basis, when you back out the carrier consolidation churn, we're talking about corrugated growth rates that are up in the 8-9% range, which are actually the highest across the entire footprint. So, we're really excited about what we see in the marketplace, and candidly, we'll be happy to have this consolidation behind us as we move into the latter part of 2019 and then into 2020.",
"With regard to your question on partners, it's really opportunistic for us at this point in time. For Jim and me, it's an allocation of capital. To the extent that there's an opportunity there that makes sense, that we can really reallocate capital to some other parts of the business, or to the balance sheet, or whatever it might be that might generate a higher rate of return for our shareholders, then we're going to jump on it. To the extent that it's not, then we won't. So, there's nothing new to report on that. We continue to look at the opportunity, and more to come in the future."
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"Adding new partners in India is not a must-do. It's an optionality that we have."
]
},
{
"name": "Amy Yong",
"speech": [
"Got it. Thank you."
]
},
{
"name": "Operator",
"speech": [
"Thank you. And, we do have time for one final question, and that is from the line of Brandon Nispel, KeyBanc Capital Markets. Please go ahead."
]
},
{
"name": "Brandon Nispel",
"speech": [
"Great, thanks for taking the question. Can you guys just maybe update us on your broader thoughts on the T-Mobile/Sprint merger? Do we see an increase of new leasing activity before churn happens for that? Maybe update us on the exposure for sites that both have T-Mobile and Sprint. And then, maybe talk more broadly about the innovation program. When do you expect these programs to be more material, and when do you expect to share more details regarding these programs? Thanks."
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"Sure, Brandon. This is Jim. I'll speak briefly to the T-Mobile/Sprint situation. The facts of the matter are both those firms right now are about 9% of our consolidated property revenues across the global footprint of American Tower. The overlap, where they both have equipment on the same tower -- each of them is 3-4% of our consolidated revenue, so, about a third of the sites or so, there's potential overlap. Until we get the future network design plan and roadmap for that plan from our customer, whether they merge or not, we can't make estimates on future churn rates, performance, et cetera.",
"And, the other ingredient to the unpredictability of this is we have an approach, we think, that's been successful in the past with industry mergers where, because of our scale and because of the diversity of our sites and our ability to operationally execute transitions, we've minimized the churn, as you may have seen, across our industry peer group by those arrangements. So, we would expect to offer a similar opportunity should there be -- and, we don't know if there will or won't yet be a T-Mobile/Sprint merger.",
"Along with that, there will be -- whether these companies stay apart or come together -- a combined subscriber group -- together or apart, again -- that will be needing and wanting a 5G service over the next five to 10 years, and that is going to be a significant investment, again, whether these companies are combined or separate. So, too hard to predict right now. Our experience, as many of you know, has been that when we did our assessment on before and after of prior mergers, we actually had revenue growth in aggregate between 15-25% from Point A before the merger was announced to Point B a year after it closed. So, we don't really know how this will play out, but we are well prepared operationally, contractually, and historic performance-wise to address this.",
"On the innovation side, again, we are going to make investments only that fit within our investment criteria, just like we do with towers. And so, to give you an estimate of materiality, if you will, it will be difficult on a long-term basis, but we will continue to be able to tell you on a short-term basis how we're doing with that.",
"We've already made some material investments in fiber-to-the-tower phased initiatives -- about $700 million so far -- where we have discovered that there's a broader benefit in owning fiber in certain international markets that are poorly served with a fiber-optic cable infrastructure because first and foremost, to drive 4G service, you need fiber-optic cable to the tower, and where we can't get it, we've acted in ways that we've got a high-returning asset already that we're using to bolster our towers' attractiveness, which will turbocharge that investment. So, those are the kinds of innovations that we're discovering as we go, and as far as what the ultimate size of those will be and when they're going to click in, we'll be updating you every quarter."
]
},
{
"name": "Brandon Nispel",
"speech": [
"Great. Appreciate you taking the questions."
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"Sure."
]
},
{
"name": "Igor Khislavsky",
"speech": [
"Great. Well, thank you, everyone, for joining. Have a great day."
]
},
{
"name": "James D. Taiclet, Jr.",
"speech": [
"Thanks, everybody."
]
},
{
"name": "Operator",
"speech": [
"Thank you. Ladies and gentlemen, that does conclude your conference. We do thank you for joining. You may now disconnect. Have a good day."
]
},
{
"name": "Brandon Nispel",
"speech": [
"More AMT analysis",
"This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see ourTerms and Conditionsfor additional details, including our Obligatory Capitalized Disclaimers of Liability."
]
}
] |
AMT
|
2019-05-03
|
[
{
"description": "Vice President, Investor Relations",
"name": "Igor Khislavsky",
"position": "Executive"
},
{
"description": "Chairman, President, and Chief Executive Officer",
"name": "James D. Taiclet",
"position": "Executive"
},
{
"description": "Executive Vice President and Chief Financial Officer",
"name": "Tom Bartlett",
"position": "Executive"
},
{
"description": "KeyBanc Capital Markets -- Analyst",
"name": "Brandon Nispel",
"position": "Analyst"
},
{
"description": "Cowen & Company -- Analyst",
"name": "Colby Synesael",
"position": "Analyst"
},
{
"description": "Morgan Stanley -- Analyst",
"name": "Simon Flannery",
"position": "Analyst"
},
{
"description": "UBS -- Analyst",
"name": "Batya Levi",
"position": "Analyst"
},
{
"description": "Bank of America Merrill Lynch -- Analyst",
"name": "David Barden",
"position": "Analyst"
},
{
"description": "Raymond James -- Analyst",
"name": "Ric Prentiss",
"position": "Analyst"
},
{
"description": "Citigroup -- Analyst",
"name": "Michael Rollins",
"position": "Analyst"
},
{
"description": "Deutsche Bank -- Analyst",
"name": "Matthew Niknam",
"position": "Analyst"
},
{
"description": "Oppenheimer -- Analyst",
"name": "Timothy Horan",
"position": "Analyst"
},
{
"description": "JPMorgan -- Analyst",
"name": "Philip Cusick",
"position": "Analyst"
}
] |
[
{
"name": "Operator",
"speech": [
"Ladies and gentlemen, thank you for standing by. Welcome to the American Tower First Quarter 2019 Earnings Call. Now at this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session. (Operator Instructions) As a reminder, today's call is being recorded and your hosting speaker Igor Khislavsky. Please go ahead."
]
},
{
"name": "Igor Khislavsky",
"speech": [
"Thanks, Kevin. Good morning and thank you for joining American Tower's First Quarter 2019 Earnings Conference Call.",
"We've posted a presentation, which we'll refer to throughout our prepared remarks, under the Investor Relations tab of our website, www.americantower.com. Our agenda for this morning's call will be as follows. First, I'll provide an overview of our financial results for the quarter. Next, Jim Taiclet, our Chairman, President, and CEO, will provide a brief update on our U.S. business. And finally, Tom Bartlett, our Executive Vice President and CFO, will discuss our first quarter results and 2019 outlook in more detail. After these comments, we will open up the call for your questions.",
"Before I begin, I'll remind you that this call will contain forward-looking statements that involve a number of risks and uncertainties. Examples of these statements include our expectations regarding industry trends, as well as our future growth, including our 2019 outlook, capital allocation and future operating performance; the pacing and magnitude of the Indian carrier consolidation process and its impacts on American Tower, and any other statements regarding matters that are not historical facts.",
"You should be aware that certain factors may affect us in the future and could cause actual results to differ materially from those expressed in these forward-looking statements. Such factors include the risk factors set forth in this morning's earnings press release, those set forth in our Form 10-K for the year ended December 31st, 2018, and in other filings we make with the SEC. We urge you to consider these factors and remind you that we undertake no obligation to update the information contained in this call to reflect subsequent events or circumstances.",
"Now, please turn to Slide 4 of our presentation, which highlights our financial results for the first quarter of 2019. As expected, these results, as well as our year-over-year growth rates, were impacted by Indian carrier consolidation-driven churn. During the quarter, our property revenue grew 4.4% to $1.8 billion, our adjusted EBITDA grew by 5% to $1.1 billion and our consolidated AFFO and consolidated AFFO per share increased by 6.7% and 5.4% to $861 million and $1.94 per share respectively.",
"Finally, net income attributable to American Tower Corporation common stockholders increased by more than 44% to $397 million or $0.89 per diluted common share. Additionally, like last quarter, many of our comments around first quarter results and our 2019 outlook will be focused on growth rates normalized for carrier consolidation-driven churn in India. Normalized outlook growth rates also adjust for the non-recurrence of the impacts of the Tata settlement we recorded in the fourth quarter of 2018. We view these normalized results as important indicators of the underlying trends of our business. Reconciliations of these normalized metrics to our GAAP results are included in the back of our earnings presentation, in our press release and in our supplemental package.",
"And with that, I'll turn the call over to Jim."
]
},
{
"name": "James D. Taiclet",
"speech": [
"Thanks Igor and good morning to everyone on the call. My remarks today will focus on the traditional first quarter report theme of our U.S. business, which accounts for the majority of our cash flows. ATC's U.S. operations continue to generate strong organic tenant billings growth, achieving 8.2% in Q1 2019. Rapidly rising mobile data usage in the range of 30% to 40% per year remains the underlying driver of demand for our U.S. assets. The sheer growth in the volume of mobile data traffic, plus consumers expectations of ubiquitous, higher quality coverage, motivate the national wireless carriers to continually invest in their networks to remain competitive.",
"Consequently, we again expect U.S. aggregate mobile CapEx in 2019 to be on the order of $30 billion, as carriers preserve network quality and enhanced capacity. For ATC, we expect that to translate into significant lease amendment revenue growth on our towers, including for equipment to support the deployment of new and repurposed spectrum bands. Independent industry research estimates suggest that elevated usage trends will persist, as more advanced devices, applications and network technologies are introduced in the United States. One key projection is that by 2023, the average U.S. consumer mobile device is expected to consume nearly 50 gigabytes of data per month, which is nearly four times current levels.",
"Meanwhile, industry analysts are also forecasting the deployment of more than 0.5 billion active IoT devices in the U.S. within the next five years . Taken together, in aggregate. Monthly U.S. mobile data usage is therefore predicted to exceed 20 exabytes by 2023, again, about four times today's levels. As our tenants seek to optimize their networks in the context of this tremendous usage growth, initial deployments and mobile operator planning for wider implementation of 5G have intensified.",
"As described in their respective public statements, each U.S. wireless carrier is crafting its own individual approach to the rollout of this new technology. Each has outlined initial plans, based on specific spectrum assets, coverage goals and a number of other factors. At the same time, there are few fundamental 5G-related themes that we believe will be broad based throughout the industry.",
"In addition to providing a more efficient technology to help support the existing pace of aggregate data demand growth, we expect 5G to usher in a variety of new products and services for both consumers and businesses. These will include numerous IoT functions and a host of other low latency, high bandwidth applications. And when it comes to 5G, we firmly believe that a substantial portion of that network investment will be oriented toward macro towers, utilizing sub-6 gigahertz spectrum to serve the needs of the 85% of the U.S. population that's living outside of urban areas. This is likely to include spectrum assets like 600 megahertz, 2.5 gigahertz, CBRS and the C-band, among others.",
"All these bands, largely deployed on macro tower assets, will likely be utilized to achieve the capacity and the broad coverage needed to serve the topographic and demographic realities of the United States population. Importantly, we view our approximately 40,000-site macro tower portfolio as extremely well positioned to capture a significant portion of this activity during the evolution from 4G to 5G, similar to past network technology cycles.",
"Our franchise real estate assets typically have significant incremental capacity and are located in high value areas, such as highway corridors and major suburbs. We contract for space on these assets under lease structures that have enabled us to maximize the revenue and cash flows throughout the mobile technology deployment cycle, while at the same time providing significant value to our tenants. We believe that the combination of the highest quality asset base and the resiliency of our carefully crafted commercial agreements, has contributed to the relative outperformance in our organic growth for the U.S. business within our domestic peer group.",
"Slide 6 of our earnings deck provides a quick overview of our recent U.S. track record. As you can see, U.S. organic tenant billings growth since 2015 has averaged more than 6.5% at American Tower, including another strong year expected now in 2019, at roughly 7%. An important component of this growth has been consistently low churn, averaging under 2% over the same time period, which correlates directly with our lease arrangements and ability to mitigate churn events, including those resulting from carrier consolidation. We've also made a concerted effort to build and acquire low capital intensity assets that show attractive operating leverage.",
"As a result, U.S. capital intensity for ATC has declined over time, as revenue has grown and maintenance CapEx has remained broadly consistent on a per site basis. Consequently, the overall return on invested capital for our U.S. tower assets has risen by nearly 240 basis points since 2015, with sites we've owned since 2010 generating an even higher ROIC, approaching 20%.",
"Based on the underlying demand trends in the industry, the upcoming rollout of 5G, anticipated deployments of new spectrum and our strong competitive positioning, we expect that our core U.S. business will continue to produce favorable results over a multiyear period looking forward. At the same time, we are proactively looking for ways to further enhance our growth trajectory, augment the value of our existing assets and explore efficiencies through our innovation program. This program includes attracting new tenants and industries beyond our traditional telecom tenants, finding new ways to take advantage of the ground space at the base of our tower sites, along with a number of other opportunities. We've also made some relatively small investments in international fiber within that innovation framework, but continue to view U.S. fiber assets as inherently less attractive, due to the extensive availability of competitive fiber supply in the U.S. and the resulting less attractive growth and return characteristics of domestic U.S. fiber.",
"One area of focus I'll expand on for just a few minutes is the initiative that we are pursuing on EDGE data. As information generation and processing progressively moves to the network EDGE, particularly with respect to advanced IoT applications, we expect there to be a greater need for lower latency through distributed storage and compute functionality in close proximity to both wireless and wireline end consumers. As compute offerings may eventually serve autonomous vehicle networks, Interactive and immersive media delivery, content caching and any number of other products and services where low latency is a must or data needs to be closer to the consumer or the machine. We've been evaluating this for some time, and have an ongoing EDGE compute trials at several of our tower sites.",
"In addition, we recently acquired Colo Atl, an interconnection facility in Atlanta to further explore the latency and distributed transport networks and had a firsthand look at the early stages of the cloud evolution to the EDGE that we expect to see accelerate the future.",
"Colo Atl is exactly the type of asset that is ideally suited for our innovation program. The $70 million or so purchase price represents a roughly 15 times year-one adjusted EBITDA multiple and we expect additional growth as this facility is leased up, driving an attractive return on the existing business. Even more importantly, Colo Atl affords us the opportunity to learn firsthand about the evolution of connectivity for consumers' devices, IoT units and autonomous vehicles to the cloud. This includes direct and interactive knowledge of potential future tenant needs, key trends like cloud gaming technology developments, like hybrid cloud and a host of other aspects that we could not evaluate and prototype with partners without owning an asset like this.",
"At the same time, I'll emphasize to everyone that projects like Colo Atl do not indicate a shift in strategy or a material pivot in focus for American Tower. On the contrary, our innovation investments are designed primarily to drive additional tenant leasing growth on our tower and in-building systems, whether it be from existing or new customers and adjacent assets that enhance the leasing value and potential of the tower. Importantly, we will apply the same capital allocation discipline that we've used for our tower acquisitions over the years to sizable innovation-related investments that we might explore.",
"In the U.S., in particular, we believe those existing assets are poised to deliver continued strong performance, based on the drivers I referenced earlier. In short, we anticipate more equipment finding its way onto more of our sites as network quality and performance remain essential to our domestic wireless operator tenants. Moreover, whether there are three national wireless players or four in the U.S., the number of subscribers will remain consistent and these subscribers will continue to expand their data usage. Therefore, in either a four or three carrier market, we would continue to expect 30% to 40% annual mobile data usage growth, roughly $30 billion of industry CapEx annually and further deployment of 4G and 5G equipment on towers. Consequently, we expect to generate continued solid U.S. organic growth and attractive returns over our planning cycle.",
"With that I will turn the call over to Tom to go through our results for the quarter and our 2019 outlook."
]
},
{
"name": "Tom Bartlett",
"speech": [
"Thanks, Jim. Good morning, everyone. Following a strong finish to 2018, we kicked off 2019 with a terrific set of results. Our Q1 U.S. organic tenant billings growth came in at over 8%, new business trends throughout our Latin America and EMEA segments remained solid, the recovery in India continue to progress in line with our expectations and we constructed over 700 sites globally. We also grew our common stock dividend by 20% over the prior year quarter, while continuing to deploy capital to both our core business and to select innovation-oriented investments that Jim just mentioned.",
"With that, let's take a deep dive into our first quarter results and our outlook for the full year. If you please turn to slide 8. During the quarter, we generated consolidated organic tenant billings growth, normalized for the impacts of Indian carrier consolidation-driven churn of over 8%. More than 6% of this was driven by volume growth from gross new business.",
"From a segment perspective, our U.S. region reported property revenue growth for the period of nearly 6%, including a negative impact of 2.3% from lower non-cash straight-line revenue recognition. This reflected our second consecutive quarter of record new business contributions, leading to organic tenant billings growth of 8.2%. Volume growth from co-locations and amendments contributed over 6%, while pricing escalators contributed just over 3%. This was partially offset by churn of about 1.3%. Our major U.S. wireless carrier customers continue to make significant network investments to keep pace with the growing mobile data usage. And we again saw activity, largely weighted toward amendments in the quarter.",
"Our reported international property revenue growth during the period was about 3%, including a negative impact of 9% due to the Indian carrier consolidation-driven churn. Underpinning this growth was normalized organic tenant billings growth of over 8%. International new business was supported by significant network spending from tenants across our footprint, especially in key markets like India, Mexico and South Africa. New business revenue from co-locations and amendments drove about 6% of the growth, while escalators contributed nearly 4%. Other run rate items added nearly 1% with normal due course churn offsetting the items above by just over 2%.",
"As expected, the flow-through financial impacts due to the India carrier consolidation churn accelerated in the quarter and Q1 should be the high watermark for the year, regards this consolidation churn. Consequently, we expect to see sequential improvement in India churn starting in Q2 and anticipate that overall organic tenant billings growth rates in the market to approach historical rates beginning in 2020. In fact, even in this past quarter, normalized organic tenant billings growth in Asia was over 10%.",
"And finally, the day one revenue associated with the more than 25,000 sites we've added over the course of the last year, contributed another 4.2% to our global tenant billings growth. These new assets included our acquisitions of around 20,000 sites from Vodafone and Idea in India, as well as the nearly 3,200 newly constructed sites, built primarily in our international markets. Our average day one U.S. dollar denominated NOI yields were nearly 12%.",
"New builds continue to be an integral part of our capital deployment program. We had a strong quarter of activity in Q1 across our international markets, constructing more than double the number of sites we built in Q1 of 2018. In India, we sustained momentum from last quarter and built over 540 sites, while also building nearly 100 sites in both EMEA and Latin America. Importantly, the day one NOI yield on these sites remained extremely attractive, with yields on new builds in India and EMEA, in particular, generating initial NOI yields in the mid-teen percent range. This activity is an extension of the historical success we've had building sites across our diverse international portfolio where carriers continue to make significant investments in network coverage and capacity. In fact, more than 15% of our total international portfolio is comprised of sites we've constructed, with NOI yields on those sites now in the 20% range. And as I will touch on later, given the attractive economics of these projects and the strong demand for additional towers, particularly in India and Africa, we expect our construction activity to ramp throughout the year.",
"Turning to Slide 9. We also generated solid adjusted EBITDA and consolidated AFFO growth during the first quarter, driven by the strong revenue growth and diligent management of operating industry -- interest expense and seasonally low maintenance CapEx. Adjusted EBITDA grew by nearly 5% with our adjusted EBITDA margin increasing to about 61.5%. Normalized adjusted EBITDA growth was over 9%, resulting in normalized adjusted EBITDA margin of nearly 62%. These results included benefits from recent investments we've made in power and fuel, particularly in our African markets, where we continue to optimize our processes and invest in solutions like lithium-ion batteries and solar power. As a result of these investments, for example, we reduced our generator run hours in Africa by over 15% as compared to Q1 of 2018 and continue to look for ways to further reduce our fuel consumption.",
"We also drove solid consolidated AFFO and AFFO per share in Q1. Consolidated AFFO grew by nearly 7% and consolidated AFFO per share grew over 5% to $1.94 per share, while AFFO attributable to common stockholders grew nearly 8% or over 6% per share. On a normalized basis, consolidated AFFO grew by over 11% or nearly 10% per share. This was driven largely by our strong cash adjusted EBITDA growth, as well as prudent maintenance of our balance sheet. In addition, our Q1 results also benefited from the lower seasonally adjusted maintenance CapEx levels, which we expect will revert to a more typical range as we move through the rest of the year.",
"Turning to Slide 10. Let's now take a look at our expectations for 2019, which are largely consistent with the outlook we previously reviewed with you, given we only issued guidance just a short while ago. At this point, we are reiterating our expectations for organic tenant billings growth across all of our geographic segments. Trends continue to be roughly in line with our prior assumptions. We continue to expect normalized international organic tenant billings growth to be about 50 basis points higher than our U.S. organic tenant billings growth of about 7%. These projections include a record year of contributions from co-locations and amendments throughout the business, just as we discussed last quarter. We expect to see a return to positive organic tenant billings growth in our international business by Q4, after flushing out most of the remaining Indian carrier consolidated churn.",
"Looking at Slide 11. At this point, we're also maintaining our expectations for 2019 property revenue, despite FX headwinds of around $13 million versus our prior outlook. Current assumptions reflect a $10 million increase in U.S. revenue versus our prior outlook, primarily driven by the combination of slightly higher straight-line revenue and acquisitions closed in the quarter. In addition, we expect around $3 million in outperformance internationally, including higher new build assumptions, particularly in EMEA. We view this is an early indication of increasing demand for tower space in the region.",
"We are also reconfirming our expectations for adjusted EBITDA at the midpoint of our outlook, despite approximately $14 million in unfavorable FX translation. This is primarily due to the revenue items I just mentioned, as well as some slight outperformance on the operating expense side throughout the business.",
"And lastly, we are reiterating our expectations for consolidated AFFO for the year, with the business offsetting about $12 million in unfavorable FX. On a per share basis, we continue to expect normalized growth of over 9% at the midpoint, reflecting our strong operating leverage.",
"Moving to Slide 12. I'd like to now briefly discuss our capital allocation plans for the year and the success of our capital allocation program historically. We continue to target our annual common stock dividend growth of at least 20%, subject to discretion of the Board and expect to declare roughly $1.7 billion in dividends in 2019. In addition, we plan to deploy $1 billion toward our CapEx program with over 80% of that spending being discretionary in nature. This is up $50 million as compared to our prior expectations, driven by a 250-site increase in expected new builds for the year. We now expect to construct almost 3,300 sites at the midpoint during 2019, which would represent a new record for American Tower. This speaks to the tremendous long-term opportunity we have in our existing markets to add incremental scale and help our tenants add coverage and capacity to their networks.",
"Importantly, and as I mentioned earlier, most of our new builds are concentrated in our India and African markets, where initial NOI yields on new site builds were in the mid-teens in Q1. We are especially pleased by the progress we've made in Nigeria, our largest market in Africa, where we have a strong new build pipeline. And finally, taking into account the M&A we've completed year-to-date, the first part of the Tata's options being exercised in our India business that were redeemed in Q1, and the second part that we would expect to redeem in late Q2 or early Q3, we've committed roughly $900 million to acquisitions.",
"Our capital allocation plan for 2019 is firmly aligned with our capital allocation methodology we've used over the last decade to drive attractive long-term returns. This process focuses on constructing and acquiring assets that have exclusive real estate rights, significant structural capacity, low capital intensity and the potential for sustained long-term growth in free cash flow generation, all at attractive price points. Since 2009, utilizing this criteria, we've amassed a high quality portfolio of communications infrastructure assets in the most significant free market democracies around the globe and expanded our global site count at an average annual rate of over 22%. This has driven a free cash flow CAGR of over 15% over the same period. That growing recurring free cash flow base has enabled us to further expand our portfolio, while maintaining a strong balance sheet and simultaneously returning capital to shareholders through our common stock dividend and share repurchase programs.",
"Turning to Slide 13. A key part of our ability to deploy capital effectively has been an extensive evaluation of different asset classes within the communications infrastructure space, drawing on a large set of historical data. For example, while we have a leading portfolio of macro towers in the United States, we also have one of the largest network of indoor DAS systems in the United States and a smaller portfolio of outdoor small cells. We evaluate the performance of these assets regularly, to help inform our future investments in the U.S. and our international markets, where small cell densification is typically in earlier stages. As you can see on this slide, the performance of these assets has varied considerably over time, with towers indoor systems generating margins and returns significantly in excess of outdoor small cells. This divergent performance is in part due to the much higher tenancy ratios we have seen on towers and venue-based DAS systems, as opposed to outdoor networks with towers and indoor DAS at over 2% (ph) and non-venue outdoor DAS in the low-1% (ph) range.",
"Additionally, the capital intensity of outdoor systems in the U.S. is higher with incremental CapEx generally required to secure additional tenants. And finally, the cash flows of small cell systems tend to be more non-recurring in nature, due to the non-cash prepaid amortization revenue associated with upfront capital contributions. Armed with this historical data, we've optimized our capital allocation decisions over time to ensure that capital is deployed to more attractive projects, centered on inherently more attractive assets. This drove our decision to increase the scale of our macro tower and indoor system portfolio in the U.S. through large transactions with GTP and Verizon, for example, while passing on large U.S. fiber assets that have been available for sale. Importantly, we expect to utilize this framework within our innovation program as well. Significant innovation investments, just like the investments we make in our core business, must conform to the same rigorous database criteria, as well as the governance and decision-making approval process.",
"Turning to Slide 14 and in summary, 2019 is off to a strong start in American Tower with solid organic trends being realized across our global footprint. Our U.S. business generated organic tenant billings growth of 8% or above for the second consecutive quarter, while new business in EMEA and India continues to build. We've also increased assumptions for new site builds, driven primarily by the elevated demand from our carrier customers in Nigeria, which speaks to the tremendous need for incremental coverage in the emerging markets we serve, as the technological migration to 4G continues. We were able to translate this strong top line growth and the solid growth in adjusted EBITDA and solid AFFO per share and expect to grow AFFO per share on a normalized basis by over 9% for the full year.",
"Additionally, we remain firmly committed to growing our common stock dividend, subject to the Board's discretion, as a key part of our total return formula, while maintaining our long-held financial policies and investment-grade credit rating. All in all, we expect 2019 to be another solid year and look forward to updating you all on our continued progress in July.",
"With that I'll turn the call over to the operator, so we can jump into some Q&A."
]
}
] |
[
{
"name": "Operator",
"speech": [
"(Operator Instructions) With that being said, we'll go straight to the first question from Brandon Nispel, KeyBanc Capital Markets. Please go ahead."
]
},
{
"name": "Brandon Nispel",
"speech": [
"Great, thanks for taking my questions. I had two if I could. First in the US business, another strong quarter of 8%-plus growth. I think some people had thought that that could never happen, given the size of your business. Can you maybe unpack that growth in terms of what percentage of your new leasing activity is coming from the big four US carriers and was hoping that you could also impact your guidance along the same lines for the year?",
"Secondly, one of the things that we get questions on, and I thought was highlighted really well on the call, was the return on investment in the US business. When you think about the different international markets you had and maybe particularly India, I was hoping you could comment on your longer-term expectations for return on investment and whether or not there are any structural benefits or negatives that may make those markets less attractive from a return on investment standpoint. Thanks."
]
},
{
"name": "James D. Taiclet",
"speech": [
"So Brandon, good morning. The percent of US business coming from the big four carriers in the United States, both for the quarter and our expectations for the year is going to range 85% to 90%, coming from those four companies. So that's similar for both current results and for the guidance for the year. And then when it comes to India and emerging markets in that, Asia generally low to mid-teen percent ROI is our ultimate goal, or ROIC. So we expect to attain that within the planning period, which is 10 years for each investment, so with the Viom investment a couple -- three years old, we expect by the mid-2020s that we should be able to achieve that kind of level."
]
},
{
"name": "Tom Bartlett",
"speech": [
"And just to add on, just on the color on the growth. Again, we're still, as I mentioned, largely amendment-driven in 2019, and I would expect that to be the same really. For the balance of the year, it is probably 80:20 kind of relationship. And as Jim mentioned, on the ROI, I mean if you take a look at the US actually in EMEA and LATAM, our ROICs in those markets are largely (ph) 10% at this point in time. Now given the consolidated churn that we've seen in India, the ROIC in that particular region is below 10%, probably in that 6% plus kind of range. So we would -- obviously given the growth that we've seen in the market -- by the way, in Q1 we had a record level of new co-locations in Mammoth, contributing to the organic growth in that market. So, and as I mentioned, there over kind of a 10% on a normalized basis growth. So we would definitely see that kind of expansion ROIC over the next several years."
]
},
{
"name": "Brandon Nispel",
"speech": [
"And I guess, if I could just follow up quickly, 85% to 90% new leasing from Big Four, how does that compare with what you've seen historically?"
]
},
{
"name": "Tom Bartlett",
"speech": [
"It's very consistent with what we've seen historically."
]
},
{
"name": "Operator",
"speech": [
"Thank you. And next question is from the line of Colby Synesael with Cowen & Company. Please go ahead."
]
},
{
"name": "Colby Synesael",
"speech": [
"Great, thank you. As it relates to your innovation program and I guess that's where the Colo Atl $70 million investment fits in. I'm just curious, how big is that program and what is the expectation or what expectation should we have for additional smaller, I guess what I would refer to as just trial type acquisitions, just to learn more about that market?",
"And then secondly, as it relates to the US organic guidance of around 7% versus the 8% plus you just did that obviously would imply then that we should see a notable step down as we go through the year. How should we interpret that in terms of what might be driving that slowdown as we go through? Thanks."
]
},
{
"name": "James D. Taiclet",
"speech": [
"Colby, good morning. It's Jim. On the innovation program, we're essentially in the exploratory and prototyping phase with outside customers, including in some areas the big four or international markets, there's sort of a prevalence overseas in markets, whether it's energy management or it's figuring out what the EDGE data plan is going to be, is often with our current customers. And secondly, we're trying to understand and prototype projects with customers -- potential customers that might scale in industries other than telecommunications, which will need those kind of assets, so the kind of assets that we provide, which are tower sites and indoor DAS systems, predominantly.",
"So that's the realm of the program. What we spent so far to-date on capital expense has been -- and mergers and acquisitions has been about $1 billion total. The bulk of that in five related assets outside the US, whose predominant purpose at ATC is to connect fiber to towers in markets and countries where there isn't a robust fiber supply base, like there is in the US.",
"So for 4G sites and certainly for 5G, every tower is ultimately going to need a fiber like connection or fiber connection to it and we're making most of our investments to lay the groundwork literally for that to happen in emerging markets. And so, as Tom said, we're only going to make investments in assets and in locations and for applications that we expect to meet our return criteria similar to towers."
]
},
{
"name": "Tom Bartlett",
"speech": [
"And Colby, regarding to your second question, at this point of time in the year we're keeping our annual guidance roughly the same. Really the only issue with the guidance is, as I mentioned, kind of a short while ago, we continue -- we are seeing the same positive trends we expected when we originally rolled out the guidance just a couple of months ago. Coming into the year, you always have more visibility into the first half. So makes sense that you would expect a stronger first half, and as you know, as we progress through the year and in July, to the extent that we see some different trends, hopefully, we will see upside, but we'll see, and we'll update that guidance in July."
]
},
{
"name": "Colby Synesael",
"speech": [
"So, nothing specific that you're thinking of that would clearly lead to a step down? I guess, sounds like just more conservatism at this point than anything else."
]
},
{
"name": "Tom Bartlett",
"speech": [
"Yeah, I think that's fair. I mean I think we have strong application pipelines. The US group is -- our US team is excited about this types of activity that they're seeing and we're coming off a very strong first quarter, and hopefully, we'll see some of those continuing trends going forward."
]
},
{
"name": "James D. Taiclet",
"speech": [
"There's one mathematical factor in addition to that, which is the quarterly comps from year-to-year can vary. Right? So in 2018 at ATC, we had relatively lower growth than later in the year, and this year we're having initially high growth and we've kept our guidance, as Tom said, for the following quarter. So even the comps mathematically, simply give you a little bit of a different answer, if you will, going forward. So again, we'll update everything based on what actually happens over the next couple of months."
]
},
{
"name": "Colby Synesael",
"speech": [
"Thank you."
]
},
{
"name": "Operator",
"speech": [
"And next question is from the line of Simon Flannery, Morgan Stanley. Please go ahead."
]
},
{
"name": "Simon Flannery",
"speech": [
"Great, thanks a lot. I wonder if we could talk a little bit about some of the international markets. Can you drive it a little bit more into the individual markets in Latin America and EMEA, what are you seeing, where it's strong, where it's a little bit slower? And also in Europe, there's a lot of portfolios that are potentially being offered by the carriers. How do you think about that market and is there likely to be any value there to cause you to do more in that area? Thanks."
]
},
{
"name": "James D. Taiclet",
"speech": [
"Sure, Simon. Some of the strong international markets continue to be Mexico, which is having a 4G campaign, if you will, between the new entrant Altan, and some of the incumbents that are already there. Brazil has also been strong. All four of their wireless operators there are competing in deploying 3G and 4G. In spite of all that there are some lower escalators based on inflation, and also some slightly higher churn in the markets, due to some Nextel legacy items that's it rolling off, which we expected anyway. So -- but overall growth -- gross growth rates, as Tom suggests, in Brazil are really strong. India is really coming back on the new business, the gross new business, if you will, before churn and we expect that trend to continue, especially with the rights offerings and other capital raising activities of Idea, Vodafone and Airtel along the way. So when you add it all up, it's about 10% plus normalized organic growth in our international markets in our forecast this year.",
"As far as European assets, so we're going to look at them through the same lens we've always looked at them through, most likely lower growth than some of our current markets. including the US. Also some industry structure concerns over there that could also inhibit growth in returns and frankly, there is a new investor class coming into that space, it has come into that space that has lower return criteria and until that changes, because we're not changing our investment criteria, we may or may not act in a large way in Europe."
]
},
{
"name": "Simon Flannery",
"speech": [
"And the industry structure means less than four players or what's that kind of comment?"
]
},
{
"name": "James D. Taiclet",
"speech": [
"Well there are three or four mobile operators in all the markets which -- in Europe, which causes them to be highly competitive, it's tougher for them to -- because the countries are smaller in scale than, say, the US is to invest as sort of rapidly, historically, than the US will invest. So growth rates tend to be a little bit lower. And then there's the standard supply side of towers in Europe, which tend to be shorter, a lot of overlap and often some churn that comes with infrastructure consolidation that you have to absorb if you're into these businesses. So those are some of the structural issues in Europe that we think retard the growth rate potential a little bit."
]
},
{
"name": "Tom Bartlett",
"speech": [
"Even, Simon, if you take a look at the press release, just look down the segment information, you can see some of the growth we had in the quarter internationally in co-locations and amendments and we have roughly $32 million of new business versus $27 million (ph) from last year. So I think they're all strong growth, and it's largely being led by India. I mean, the -- Latin America continues to be strong and EMEA is up a little bit, but India has actually been kind of the driving force in Q1. So just something to look at."
]
},
{
"name": "Simon Flannery",
"speech": [
"Thank you."
]
},
{
"name": "Operator",
"speech": [
"Our next question is from the line of Batya Levi, UBS. Please go ahead."
]
},
{
"name": "Batya Levi",
"speech": [
"Great, thank you. In the US, can you provide maybe a little bit more color on the type of early activity and applications you're seeing related to 4G deployments and how do you think that changes the 80:20 amendment new lease mix going forward? Do you think some of that new business has gone toward carrier-owned towers or maybe other private companies? And just lastly, can you provide an update on the monthly revenues you get from the amendment today, how's that been increasing over time?"
]
},
{
"name": "James D. Taiclet",
"speech": [
"I mean I think -- I think the question was on the 5G, what are you actually seeing relative to deployment of 5G activity on the -- on the towers, is that correct?"
]
},
{
"name": "Batya Levi",
"speech": [
"That's right. Then amendment, new lease and if you're -- if you think some of that activity is actually going toward their own towers or other private companies?"
]
},
{
"name": "James D. Taiclet",
"speech": [
"Well, I don't know about that mix. I can tell you that I'm -- I mean it's a better question for the carriers themselves in terms of the types of things that they are deploying. But I'm sure that they are 4G enhanced, they are 5G radios that are being deployed as we speak. So that when 5G gets turned on, it's really just a kind of a software upgrade. So I'm certain that they are those applications. I don't know what the percentage is relative to how much of that activity is normal -- to normal kind of 4G activity, but I'm certain that the carriers themselves are deploying that kind of technology. I mean if you look at T-Mobile, they talked about 600 megahertz being rolled out to really support their nationwide 5G capability.",
"So you know that -- those types of radios are being deployed. And relative to amendment activity, as I said, overall amendments are roughly 80%. The activity that we're seeing from an application and a -- perspective in the United States, they're probably in the $800 -- $800, $900 range, given the level of equipment that is being put on the sites and amending those particular leases."
]
},
{
"name": "Batya Levi",
"speech": [
"Okay, thank you."
]
},
{
"name": "Operator",
"speech": [
"Next question is from the line of David Barden, Bank of America. Please go ahead."
]
},
{
"name": "David Barden",
"speech": [
"Hey guys, thanks for taking the questions. I guess -- two, I guess, to start. First would be, SBA went out of their way to call out Dish as a new business driver for them. Sounds like they were willing to be flexible to kind of accommodate some Dish's challenges that they look to kind of get their 2020 deadline fulfilled. So I was wondering if you guys could kind of address that opportunity and what it's contributing to this kind of 8.2% domestic growth rate that we're seeing today?",
"And then the second is, Jio in India has spoken publicly about trying to monetize its roughly 100,000 tower portfolio, and I could see how that might represent a potential risk if it fell into an independent operator's hands or a potential opportunity if it represented a consolidation opportunity for American Tower. So I wonder if you could talk about the risk-opportunity that Jio represents in their tower portfolio? Thanks."
]
},
{
"name": "James D. Taiclet",
"speech": [
"As far as specific customers, including Dish, David, we don't comment on either negotiations contracts or new business flow with any of them, but you can assume that for us Dish is in that 10% to 15% -- within that 10% to 15% non-major carrier new business ratio that we talked about earlier. As far as Jio, yes, there are press reports about the company exploring ways to either refinance or monetize or spin off tower and fiber assets. we will stay abreast of that -- those developments. Historically, when independent investors eventually get a hold, if they do of carrier-owned tower assets that's good for the tower industry, because the contracts tend to be arm's length and more of what I would call sort of industry standard, once the outside owners are in control of the assets and not the captive carrier business. So it will be a positive if it comes through. Either way, I don't see it as a risk at all."
]
},
{
"name": "David Barden",
"speech": [
"Okay, great, thanks guys."
]
},
{
"name": "Operator",
"speech": [
"And next question is from the line of Ric Prentiss, Raymond James. Please go ahead."
]
},
{
"name": "Ric Prentiss",
"speech": [
"Thanks. Good morning, guys. A couple of follow-ups and then one deeper question. First, when you guys talk about 80:20 amendment co-lo, how do you count if an existing customer comes and wants to do more work at the tower, maybe also including a new RAD center. Is that still counting as an amendment?"
]
},
{
"name": "James D. Taiclet",
"speech": [
"Generally, Ric, that would be a separate lease, but based on specific customers or circumstances or legacy contract that may be on the tower it could be different, but generally a new RAD center equates to a new lease which would count as a co-location."
]
},
{
"name": "Ric Prentiss",
"speech": [
"Okay. And second one, some of the other -- or one of the other tower guys mentioned that they had explicitly kind of assumed in their guidance a combination in the US from four to three, at least on their services business. Is there anything baked into your guidance on assumption of any industry change in the US?"
]
},
{
"name": "James D. Taiclet",
"speech": [
"We don't have any assumptions either way baked into industry consolidation in the US. And given that we're almost halfway through the year, and by the time something might close, whatever the ramifications could occur from that, if it happened, would probably be out in 2020 and beyond."
]
},
{
"name": "Ric Prentiss",
"speech": [
"Makes sense. The deeper question is, following up on Simon's question where you said the new investor classes coming in with lower return hurdles, is that driving also some of your thoughts that building towers might be more -- able to create value than buying towers as you look at M&A?"
]
},
{
"name": "James D. Taiclet",
"speech": [
"Yes, because those new builds, whether inside or outside of the US tend to be historically for ATC the highest-return projects we have, it's always been that way, because you are meeting a specific need of a specific carrier in a specific geography versus buying a portfolio and sort of paying the acquisition premium for that. So it's historically been the best return activity we can do, and we'll continue to do so, and as the batting order, Ric, of our capital allocation process has remained the same, we're going to fund our dividends first, we're going to build towers second, we're going to do M&A third, and if there is excess capital left over we will buy back equity or buy back stock. So that batting order remains the same."
]
},
{
"name": "Ric Prentiss",
"speech": [
"Makes sense. Appreciate the batting order with the Rays doing pretty well. Final question wraps into that, with the -- does it make sense to sell any portions of your portfolio? Increased amount of joint ventures that people have lower return hurdles and have cash in their pocket, could we see you guys sell some more stakes in your Company to bring in fresh capital to deploy elsewhere?"
]
},
{
"name": "James D. Taiclet",
"speech": [
"We're always open to innovative financing and partnership arrangements, Ric, and you've seen us do that in numerous countries, whether they are with carriers or with independent financial partners like PGGM. In Europe, we're actually -- we're a 51:49 partner with them in both France and Germany. So yes, we're open to it and we don't have any sort of religious restrictions, whether it's getting into those stakes or getting out of them, if we think the economic situation merits that."
]
},
{
"name": "Ric Prentiss",
"speech": [
"Great, thanks, guys."
]
},
{
"name": "Operator",
"speech": [
"Our next question is from the line of Michael Rollins, Citi. Please go ahead."
]
},
{
"name": "Michael Rollins",
"speech": [
"Hi, thanks and good morning. Just maybe staying on the strategic front, two questions. A few years back, you articulated the importance of being, I think it was the top three competitor in any market that you're in. I am just curious, in some of the key international markets, how do you evaluate that today and is that still important as you look at the past -- the new markets? And then going back to the question on partnerships, or the comments on partnership, are partnerships more important for the adjacent growth opportunities that you've been considering, for example, on the EDGE data center front or maybe some of the other initiatives where you need to try and edge out into a broader ecosystem? Thanks."
]
},
{
"name": "James D. Taiclet",
"speech": [
"So we're already either first or second, Mike, in most of our major international markets, and by the way, we're first in the US as an independent tower company and have been for some time. We are first in Brazil, and remember independent tower company is important here, because captive carrier assets, really to us, don't perform and aren't managed the same way. But nevertheless, in Brazil, we're number one in Mexico, we're number one, South Africa the number one independent, in India the number one independent. So we've achieved industry leadership as an independent infrastructure provider outside of carrier ownership and control in essentially all of the major markets that we care to be in. There's some where we're not and those were conscious decisions, like at the time in Nigeria where IHS was creating a larger market position than we currently have, will be a happy number two there for a while, it looks like. But, generally in the large major markets, we are the number one or two operator.",
"As far as partnerships, we are applying our innovation initiatives really across the board. As I said, the PGGM partnership on a financial perspective in Europe was something that Tom and I talked about as an innovative way to bring capital in to support our ambitions in Europe. Similarly, if we get into -- and you pointed out specifically EDGE data. I think there's a great opportunity for us to bring the asset base that we bring, which is the 40,000 US towers and the 330 or 340 indoor DAS systems we have in the US, to a partner who brings something else, could it be spectrum, could it be cloud compute capability, could it be existing big larger datacenters, any of those are possible.",
"So we've had to actually pivot our thinking to say partnerships can be, in an innovation sense, a much broader context than they are today, or they have been historically, I'd say, in our industry, which is partnerships with wireless operators in some fashion, whether it's a sale leaseback, it's sublease et cetera with the mobile operators, those have always been in our industry. But now we're taking a much wider perspective on partnerships and figuring out, we hope where the puck is going, who can partner with our assets and bring theirs in a complementary fashion and that's a perspective we're now taking."
]
},
{
"name": "Michael Rollins",
"speech": [
"Thanks a lot."
]
},
{
"name": "Operator",
"speech": [
"Our next question is from the line of Matthew Niknam, Deutsche Bank. Please go ahead."
]
},
{
"name": "Matthew Niknam",
"speech": [
"Hey, guys. Thank you for taking my question. Just on India, any more color you can share in terms of what's driving the growth activity, and then what gives you confidence in the ability of the business to actually return growth to sort of historical levels within the next couple of quarters, by 2020? Thanks."
]
},
{
"name": "James D. Taiclet",
"speech": [
"So, the drivers in India, organic growth for us on a gross basis now are Jio and the other two major carriers, are actually ramping up as well. As I mentioned, they are going to be having access to proceeds from both rights issues, so equity investments from their end investors and also asset sales that they're all planning or expected to do. So, we think that those three carriers along with BSNL in a much more minor way, will continue to drive organic growth in India, because the three of them are going to need to establish a national 4G network, which although Jio gets a lot of headlines for doing it first, is, A, not pervasive across the country, and B, not us -- with the capacity to handle a billion users on 4G. So that spend is going to happen, there'll be a -- we think a significant increase in the number of sites and the loading on sites in India. And as Tom referenced, our most active construction program already is in India, to start serving this market.",
"So when you look at, again, the fundamentals in the US, we talk about is 30% to 40% data growth, $30 billion of CapEx. In India, you're talking about even faster data growth rates on three times as many people, much earlier in the technology deployment cycle. So once the industry consolidation settles in over the course of 2019 and as we roll into 2020 and beyond, we fully expect between those three large carriers and BSNL that there'll be strong top-line organic growth demand in India."
]
},
{
"name": "Tom Bartlett",
"speech": [
"The other thing I'd add Matt is that our own internal estimates, as well as outside third-party estimates is suggesting that kind of the roughly industry 600,000 tower leases that exist in the market are going to be growing to over 1 million over the next several years and I think that's just a reflection of all the things that Jim just talked to."
]
},
{
"name": "Matthew Niknam",
"speech": [
"If I could just follow up, I think in the past you've talked about 3% to 4% sort of normalized longer-term churn in that market. Is that still the case and when do you sort of anticipate getting to more of a stabilized rate?"
]
},
{
"name": "James D. Taiclet",
"speech": [
"Actually, we think that probably the normalized rate of churn, which is if you back out what the impact of the India carrier consolidation churn in Q1, it is probably more in that 1% -- 1% to 2% kind of range. So, half of what you just talked to."
]
},
{
"name": "Matthew Niknam",
"speech": [
"And in terms of timing to get there, that sort of late 2020?"
]
},
{
"name": "James D. Taiclet",
"speech": [
"We realized that already in Q1. So we would think that as we're going out into the -- the end of this year we'll flush out all of that India carrier consolidated churn. So getting back into 2020, we should start to get back to those historical rates of what we've realized in terms of growth back in the '16 and 2017 time frames."
]
},
{
"name": "Matthew Niknam",
"speech": [
"Thank you."
]
},
{
"name": "Operator",
"speech": [
"Our next question is from the line of Tim Horan, Oppenheimer. Please go ahead."
]
},
{
"name": "Timothy Horan",
"speech": [
"Thanks, guys. Tom, I know you said normalized AFFO grew 11%. But if you normalize for the India churn, was that closer to 15%?"
]
},
{
"name": "Tom Bartlett",
"speech": [
"When I referred to the normalization, it's actually backing out that India carrier consolidated churn."
]
},
{
"name": "Timothy Horan",
"speech": [
"Great. Indoor -- can you talk about what percentage of revenue indoor is in the United States now and do you think you're kind of growing at market rate?"
]
},
{
"name": "James D. Taiclet",
"speech": [
"The indoor DAS asset is about 2% to 3% of our US revenue at this point, and that's been growing about 10% recently. So pretty solid growth in that business, although, it's relatively small compared to the major tower asset we have in the US."
]
},
{
"name": "Timothy Horan",
"speech": [
"And then lastly on India, do you think with the consolidation being done and maybe more sales of assets that the pricing structure over there could look more like the US over time? It's a fairly unique market in terms of pricing."
]
},
{
"name": "James D. Taiclet",
"speech": [
"The pricing is going to be in a different category than the US, but the long-term structure of contracts will, I think, evolve more closely to what I would call the global tower industry standard, where there's more favorable escalation rates, less favorable reinvestment rates et cetera on the sites and the elimination of discounts for second or third tenants along the way. So those sort of contract structural adjustments I expect to come over time in India, which will actually improve your effective pricing, frankly. But as far as rates -- rupees for per month per antenna, I can't predict where those are going to go."
]
},
{
"name": "Timothy Horan",
"speech": [
"Yeah. No, that's what I was looking for. That's very helpful. Thank you."
]
},
{
"name": "Operator",
"speech": [
"Thank you. And we do have time for one additional question and that will be from the line of Philip Cusick, JPMorgan. Please go ahead."
]
},
{
"name": "Philip Cusick",
"speech": [
"Just before the bell. Jim, can you talk more about the potential model for your EDGE compute at the tower, any estimate on the potential number or percent of sites over time that that might generate and sort of relative rent versus a carrier? Thanks."
]
},
{
"name": "James D. Taiclet",
"speech": [
"So there's a lot of uncertainty around all those factors Phil, and that's why we're broadening our access and involvement with other industries right now. So we're engaged with cloud providers, we're part of the CVRS team that's looking at how to deploy 3.5 spectrum, both within and without outside of mobile operators. We're involved and engaged, especially our CTO is, on innovation and technology task forces with other industries like the automotive industry, for example. So we are in a learning phase about a lot of these initiatives, including EDGE compute. But we are taking them in a methodical, serious and resourced way, so that we can be ahead of our industry, both in the US and outside, because frankly we feel we're the only globally accessible tower company in the world that can reach really all the highly populated continents with a partner, and some of those partners will be global multinational companies, unlike even the national license holders we have in our tenant base today.",
"So we do learn and prototype and determine all those factors. We know it's going to be important and we want to lead the wider industry in figuring out these tower sites. Because of their placement and their immediate proximity to the mobile RAN, radio access network, are going to be really important real estate assets that they should learn how to work with and we want them to work with us."
]
},
{
"name": "Philip Cusick",
"speech": [
"Great. Thanks Jim."
]
},
{
"name": "Operator",
"speech": [
"Thank you. Back over to speakers for any closing remarks."
]
},
{
"name": "James D. Taiclet",
"speech": [
"Great, thank you everybody for joining. Have a great day."
]
},
{
"name": "Operator",
"speech": [
"Thank you. Ladies and gentlemen, that does conclude your conference. We do thank you for joining, you may now disconnect."
]
}
] |
AMT
|
2022-04-27
| [{"description":"Vice President of Investor Relations","name":"Adam Smith","position":"Executive"},{(...TRUNCATED)
| [{"name":"Operator","speech":["Ladies and gentlemen, thank you for standing by. Welcome to the Ameri(...TRUNCATED)
| [{"name":"Operator","speech":["Thank you. [Operator instructions] Our first question will come from (...TRUNCATED)
|
AMT
|
2021-04-29
| [{"description":"Vice President of Investor Relations.","name":"Igor Khislavsky","position":"Executi(...TRUNCATED)
| [{"name":"Operator","speech":["Ladies and gentlemen, thank you for standing by. Welcome to the Ameri(...TRUNCATED)
| [{"name":"Operator","speech":["[Operator instructions] Your first question comes from the line of Si(...TRUNCATED)
|
AMT
|
2020-02-25
| [{"description":"Vice President, Investor Relations","name":"Igor Khislavsky","position":"Executive"(...TRUNCATED)
| [{"name":"Operator","speech":["Ladies and gentlemen, thank you for standing by and welcome to the Am(...TRUNCATED)
| [{"name":"Operator","speech":["[Operator Instructions] Our first question comes from the line of Mic(...TRUNCATED)
|
AMT
|
2020-07-30
| [{"description":"Vice President, Investor Relations","name":"Igor Khislavsky","position":"Executive"(...TRUNCATED)
| [{"name":"Operator","speech":["Ladies and gentlemen, thank you for standing by. Welcome to the Ameri(...TRUNCATED)
| [{"name":"Operator","speech":["Thank you. [Operator instructions] Your first question comes from the(...TRUNCATED)
|
AMT
|
2022-02-24
| [{"description":"Vice President of Investor Relations","name":"Adam Smith","position":"Executive"},{(...TRUNCATED)
| [{"name":"Operator","speech":["Ladies and gentlemen, thank you for standing by. Welcome to the Ameri(...TRUNCATED)
| [{"name":"Operator","speech":["Thank you. [Operator instructions] And we will go to the line of Simo(...TRUNCATED)
|
AMT
|
2020-10-29
| [{"description":"Vice President of Investor Relations","name":"Igor Khislavsky","position":"Executiv(...TRUNCATED)
| [{"name":"Operator","speech":["Ladies and gentlemen thank you for standing by. And welcome to the Am(...TRUNCATED)
| [{"name":"Operator","speech":["Thank you. And we have a first question from Michael Rollins with Cit(...TRUNCATED)
|
AMT
|
2023-10-26
| [{"description":"Senior Vice President of Investor Relations","name":"Adam Smith","position":"Execut(...TRUNCATED)
| [{"name":"Operator","speech":["Ladies and gentlemen, thank you for standing by. Welcome to the Ameri(...TRUNCATED)
| [{"name":"Operator","speech":["Thank you. [Operator instructions] And we'll go to the line of Simon (...TRUNCATED)
|
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