LBRDA

• Capital Allocation Policy Update

  • Liberty Capital will initiate a quarterly dividend in Q4 2026, totaling $60 million per year ($15 million per quarter). This dividend is expected to represent approximately half of 2027 free cash flow, and a smaller share in 2028 as capital expenditures decline, with management intending to grow the dividend over time.
  • GCI will target a long-term net leverage ratio of ~3x; leverage may fluctuate around this target to fund investments and acquisitions. The framework maintains an efficient balance sheet and strategic optionality without forcing near-term deployment.
  • Capital allocation priority order: 1) Fund operating business and committed network investments; 2) Pay and grow the regular dividend; 3) Maintain balance sheet alignment with the long-term leverage target; 4) Allocate residual free cash flow between attractive external investments and additional shareholder returns (share repurchases are particularly attractive when shares trade at a meaningful discount to intrinsic fair value).

• GCI Operational Progress

  • This is the first earnings call under the Liberty Capital name, with strong momentum across the business. GCI is a stable, growing cash-generative business with a unique market position in Alaska.
  • 5G service has been expanded to over 125 Alaskan communities, reaching ~83% of Alaska's population, with over 100 communities upgraded in 2026 alone. 5G replaces legacy technology, improving network performance, visibility, troubleshooting speed, and operational efficiency.
  • Consumer wireless added 2,100 lines in Q2. The converged customer base continues growing: 42% of broadband customers now take wireless service, and 63% of postpaid wireless lines are sold as part of a converged bundle, which management expects will drive higher long-term customer retention. Consumer broadband saw an organic decline of 500 subscribers, but this was more than offset by the acquisition of a small fixed broadband provider that added 5,400 subscribers.
  • GCI takes competition from Starlink seriously but adopts a pragmatic approach: where Starlink competes, GCI competes; where Starlink technology can improve GCI's network or customer solutions, GCI integrates it. GCI already uses Starlink in managed business solutions and will add Starlink's dedicated bonded gateway service as an additional network resilience layer for multiple Alaskan communities.

• Quintillion Acquisition Update

  • The strategic rationale for the acquisition remains strong: combining networks will create more ring architecture, greater routing diversity, improved outage resilience and restoration capabilities, and stronger critical infrastructure for Alaskan communities, healthcare, public safety, government, and national security.
  • All HSR waiting periods have expired, FCC review is ongoing, and the transaction is now expected to close in 2026. Management plans for a smooth, fast integration.
  • The acquisition is expected to be accretive to free cash flow in the first full year after closing. Management expects $20 million in run-rate synergies over 24 months post-closing, with roughly half achieved in the first 12 months. Including full run-rate synergies, Quintillion is expected to contribute $50 million to $55 million in adjusted OIBDA in 2026.

• Capital expenditures: 2026 is expected to be the peak year for GCI capital spending, with full-year 2026 CapEx (net of grant proceeds) projected at ~$290 million. Capital intensity is expected to meaningfully decline starting in 2027, with further declines in 2028, returning GCI to its historical capital intensity range and driving stronger free cash flow generation.
• Full-year 2026 GCI OIBDA is expected to be roughly stable year-over-year, with performance weighted more heavily to the fourth quarter.
• Increasing cash generation from declining capital intensity and the Quintillion acquisition is expected to materially expand GCI's cash generation starting in 2027.

Liberty Capital's only operating segment is GCI, which posted total Q2 2026 revenue of $261 million, flat year-over-year, with adjusted OIBDA of $96 million, an 11% year-over-year decrease. GCI operates two core product segments: 1) Consumer: Revenue declined 2% year-over-year, primarily due to the 2025 exit from the video business, partially offset by wireless subscriber growth. Gross margin increased to 71.8% driven by lower video programming direct costs. 2) Business: Revenue grew 1% year-over-year, lifted by higher business data revenue from service upgrades with existing healthcare and education customers. Gross margin decreased to 75.5% primarily due to a $9 million increase in distribution costs, of which $3 million relates to restored service on the Quintillion network, with the remainder from higher costs for upgraded services. For the trailing 12 months ending Q2 2026, GCI generated $59 million in free cash flow, a year-over-year decline driven by higher capital expenditures, lower OIBDA, and ordinary working capital swings.

• Forward-looking statements are inherently uncertain, and actual results may differ materially from projections due to unforeseen risks and uncertainties, including those disclosed in Liberty Capital's and Liberty Broadband's recent SEC filings (10-K, 10-Q).
• Starlink acts as a viable competing broadband provider, creating competitive pressure on GCI's consumer and business broadband segments.
• The Quintillion acquisition is still subject to completing FCC regulatory review, creating uncertainty around the exact timing of closing.
• Net leverage at GCI may deviate from the 3x long-term target as investments and transactions are executed, creating temporary balance sheet deviations.

Q: With stronger-than-expected wireless subscriber growth from 2026 promotions, what are the financial implications of promotional pricing versus regular rate conversion, and what details can you share on the recent 5,400-subscriber broadband acquisition? / A: The main current promotion offers free wireless service for one year when adding or upgrading a wired service, with smaller legacy promotions also running. Most new wireless lines added this year will not generate revenue until 12 months after activation, creating a one-year lag in revenue recognition for new additions. The acquired business is a small fixed wireless provider serving areas outside GCI's existing broadband footprint; GCI acquired it to expand its service footprint and gain operational experience with fixed wireless technology.

Q: Were Q2 elevated expense levels temporary or driven by seasonality, and how much of the increased expense base relates to network upgrades versus capital expenditures? / A: Two key one-time factors lifted expenses this quarter: Last year's Quintillion fiber cut reduced Q2 2025 distribution costs, so the year-over-year comparison is unfavorable now that service has been restored, and there were onetime contractor costs for special projects this quarter. Additionally, $3 million in new public company costs, not present in Q2 2025, will recur going forward.