Crown Castle (CCI) Goldman Sachs Communacopia + Technology Conference 2024 summary

Strategic review and business focus

• Ongoing strategic review of fiber and small cell businesses to determine optimal ownership structure; all options remain open.

• Operating review led to increased underwriting requirements and reduced capital intensity for new builds.

• Shifted focus to on-net and near-net opportunities, reducing capital expenditure and workforce for 2024.

• Expecting short-term disruption in fiber solutions growth but targeting a return to 3% annual growth long-term.

• Board prioritizes maximizing shareholder value, balancing near-term results with long-term growth potential.

Tower business performance and outlook

• Tower business expected to grow revenue by 4.5% in 2024, higher than similar stages in previous cycles.

• Projected mid-single-digit revenue growth (~5%) through 2027, excluding Sprint churn.

• Incremental revenue from towers comes with minimal additional cost, driving strong operating leverage.

• Churn from the T-Mobile/Sprint merger is largely recognized, with $200M revenue loss expected in 2025; long-term churn projected at 1-2% annually.

• More than 70% of company value is attributed to the tower business, which is seen as a stable, high-quality model.

Growth strategy and market dynamics

• Growth strategy focuses on maximizing returns from existing assets rather than aggressive tower acquisitions due to high private market valuations.

• Willing to expand U.S. and developed market tower footprint if returns justify the investment.

• Small cell business expected to grow at low double digits, outpacing tower business growth.

• Limited new spectrum availability is expected to drive network densification, benefiting both towers and small cells.

• Operational separation of fiber and small cell businesses is feasible, but the board is evaluating if it is strategically optimal.