American Tower Corporation Q3 FY2025 earnings call

• Steve Vondran highlighted a great quarter with double-digit AFFO per share growth, robust leasing activity in tower and data center businesses, and near-record services revenue. He discussed industry backdrop with mobile data consumption growth, 5G deployments, and satellite-based network assessments. • Rod Smith noted total revenue grew nearly 8% year-over-year, adjusted EBITDA grew nearly 8% year-over-year, attributable AFFO per share as adjusted grew ~10% year-over-year, and guidance was raised due to FX tailwinds, U.S. services outperformance, and net interest benefits. Strategic priorities include maximizing organic growth, expanding margins, disciplined capital allocation, and maintaining a strong balance sheet.

Consolidated property revenue grew nearly 6% year-over-year. U.S. and Canada property revenue was flat year-over-year but grew ~5% when excluding noncash straight-line revenue and Sprint churn. International property revenue grew ~12% year-over-year and nearly 8% when excluding noncash straight-line revenue and FX impacts. Data center property revenue grew over 14% driven by a record quarter of retail new leasing. Consolidated organic tenant billings growth was 5%, with U.S. and Canada segment growing ~4% organically and greater than 5% when excluding Sprint churn. International segment organic growth was nearly 7%. Adjusted EBITDA grew nearly 8% year-over-year, and attributable AFFO per share as adjusted grew approximately 10% year-over-year.

• Raised full year outlook across property revenue, adjusted EBITDA, attributable AFFO, and AFFO per share. At the midpoint, attributable AFFO per share as adjusted growth is expected to be approximately 7%. Net of FX headwinds and financing costs, attributable AFFO per share as adjusted growth is ~9%. The outlook raise is supported by FX tailwinds, U.S. services outperformance, and net interest benefits. • Organic growth and CoreSite revenue growth expectations remain in line with prior outlook.

• Legal dispute with AT&T Mexico over tower rent calculation, with $30 million revenue reserves assumed for 2025, $19 million already reflected in results through the third quarter. • DISH contract issue with a lawsuit filed, representing ~2% of total property revenue. • Potential impact of satellite-based networks on terrestrial towers due to capacity and economic constraints, as satellites have limitations in dense urban areas and buildings.

Q: Thoughts on services revenue and AT&T EchoStar spectrum acquisition impact on deployments in 2026?

A: Steve Vondran said services revenue pipeline is healthy, will refrain from guiding 2026 until February; AT&T spectrum acquisition will create deployment opportunities but details awaited.

Q: Relevance of tower portfolio for higher frequency bands?

A: Steven Vondran stated higher frequencies need densification, bodes well for long-term growth as carriers will densify networks.

Q: CoreSite pre-lease share dip?

A: Steven Vondran said dip is due to construction flow moving from pre-leasing to actual leasing, not deal flow slowdown, strong demand continues.

Q: Cost optimization program and CapEx considerations?

A: Rodney Smith said cost efficiencies focus, COO role to simplify operations, incremental improvements to efficient business.

Q: Data center business outlook?

A: Steven Vondran and Rodney Smith said strong double-digit growth expected, well above underwriting assumptions, robust pipeline and pricing.

Q: DISH contract and space-based player impact?

A: Steven Vondran said DISH is current, no reserves needed; space-based players may use terrestrial sites if offering direct service.

Q: U.S. business incremental non-rate revenue and data center growth?

A: Rodney Smith said $5M is small non-run rate, quarter-to-quarter fluctuations normal.

Q: Cost efficiency review and CapEx changes?

A: Steven Vondran said focus on supply chain, automation, no immediate CapEx shifts.

Q: EchoStar next steps and CoreSite value?

A: Steven Vondran said preemptive lawsuit filed, CoreSite a great fit, long-term synergies expected, stock buyback opportunistic.