Crown Castle (CCI) Citi's 2024 Global TMT Conference summary

Strategic and operating review

• Conducted a comprehensive review of the fiber business, focusing on both operational improvements and strategic options, with ongoing engagement from the board and external advisors.

• Shifted strategy to prioritize revenue growth from existing fiber assets (on-net, near-net) and reduced capital expenditures, announced and enacted in June.

• Rightsized workforce to align with lower capital needs and new operational focus, aiming to maintain employee motivation and business returns.

• Board is considering a wide range of outcomes for the fiber segment, including potential sales or retention, with flexibility to maximize shareholder value.

• Investor and stakeholder feedback is mixed and evolving, with no consensus on the preferred outcome for the fiber business.

Fiber business outlook and market dynamics

• Fiber assets are concentrated in major U.S. metro markets, supporting both small cell and enterprise demand.

• Growth targets remain at approximately 3% annually for fiber solutions and 10% or more for small cell revenue, with significantly reduced capital investment.

• Customer relationships remain strong amid operational changes, with ongoing assessment of sales pipeline and bookings.

• Metro fiber strategy focuses on shared infrastructure, not long-haul or single-customer builds, positioning assets for rising data demand, including AI-driven growth.

• Market recognition of metro fiber value is increasing, as evidenced by industry trends and recent transactions.

Financial and capital allocation considerations

• Cost structure reductions in June will be fully reflected in 2025, improving efficiency compared to 2024.

• Board is highly engaged and informed, weighing the benefits of keeping fiber and tower businesses together versus separating them.

• No narrowing of strategic options yet; board retains flexibility to choose the path that creates the most value.

• Leverage and creditworthiness of the tower business are strong, with long-term cash flows and low churn supporting investment grade status.

• Capital allocation to fiber is being reduced, with ongoing evaluation of whether to further separate or self-fund the segment.