Rod Smith: Sure. I’ll take that one. So we’re not going to give specific guidance for 2024 at this time, obviously. And I don’t want to get into specific care activity levels because I want to leave it to them to talk about the rollout plans. But in general, we have seen activity levels moderate over the last several months from the recent highs. However, the visibility that we have into a baseline level of contractually guaranteed growth through these comprehensive MLAs allow us to reiterate our expectation that we’re going to achieve an average annual OTBG growth rate of at least 5% in the U.S. and Canada segment between 2023 and 2027. And despite some of the concerns that people have in the market over the recent moderation we have visibility into a level of organic growth in 2024 that’s supportive of that average.
Now having said that, I want to break down the components a little bit, we do not have visibility into another year of $230 million growth from colocation and amendment activity. That’s far away a record from American Tower. But we balance that with an expectation for some moderation in churn following 2023, excluding Sprint. Our MLAs do provide us visibility into a level of colocation and movement contributions that exceeds the average we’ve seen over the past several years. And again, it’s supportive of that at least 5% average OTBG that we’ve guided to between 2023 and 2027. And to reiterate on our Sprint churn, the annual impacts of our Sprint churn have been $195 million in 2021, $60 million in 2022, and $50 million in 2023 and $70 million in 2024 for a total of $375 million.
So we’re past the peak of that churn, and there’s no change to that cadence versus our prior guidance in that respect.
Tom Bartlett: And Mike, I would just add just to make it clear, the delays in churn that we’re seeing in the U.S. is not Sprint related. It’s other items that we were planning that could be moved out a bit, as Steve is saying the Sprint cadence has not changed. And when you think about next year 2024 in our long-term guide, it’s unlikely that there’s going to be material upside based on where we sit today. We do think there’s potential for upside in the longer-term growth rates, but that would probably come in ’26 and ’27 and down the line, not necessarily in ’24.
Michael Rollins: Thanks. And just one quick one, what’s the percent that you’re seeing in terms of the mid-band upgrades, the percent of sites that have been upgraded for mid-band already versus the amount that might be remaining?
Rod Smith: It’s a little over half at this point.
Michael Rollins: Thank you.
Tom Bartlett: Thanks, Michael.
Operator: And next, we can go to David Barden with Bank of America. Please go ahead.
David Barden: Hey, guys. Thanks so much for taking the questions and let me echo Tom, the years we’ve spent together. It’s been great and congrats to Budd and Steve on the new roles.
Tom Bartlett: Thanks, Dave.
David Barden: So I guess, if I could start, just maybe more on the finance side, Rod. Slide 11, you talked about some of the increases we’re seeing in some of the non-U.S. regions. Could you break that down into kind of core organic leasing and then some of the inflation driven escalators? And so is this real growth that we’re seeing that could be sustained or is it more of an inflation driven bubble that we need to kind of be conscious of that might reverse? And then second, just on the India situation with the write-down, I think the tactic acknowledgment that maybe some of the loftier valuation ambitions were not there. I guess we’re all sitting here trying to figure out what kind of dilution we should be baking into 2024?
The latest press reports that India suggested kind of a $2 billion valuation, something like a 5 times EBITDA multiple. Obviously, it depends on kind of how big a stake you sell and when you sell it. But is there any kind of more color you can shed on the shape of what kind of dilution expectation we should be thinking about for ’24? Thank you.
Rod Smith: Yeah, David. So let me hit the first part of your question. I think I missed a little bit of the second, so I may ask you to repeat that. But when you think about the upside in terms of the growth rates, let me hit it by addressing the organic tenant billings piece first-off. So we are seeing increases in organic tenant billings really across the board. So you can see in the charts, they were increasing our overall organic tenant billings for the company to about 6%, that’s up about 50 basis points from prior. And that kind of — that theme is consistent across many of the regions. So as Steve just highlighted in the U.S., we’re bringing that guide to beyond 5% from what was previously around 5%. International is coming up to greater than 7%.
Prior, we were at greater than 6.5%. And then you look at the different parts of the company region by region, LatAm is going up to about 5% versus what was previously a 4%. APAC is coming up to about 5%. Previously, it was 4%. Europe was staying around where it was at 8%. And then Africa is also coming up to around 12% from what was prior higher than 11%. A couple of things that I would say, in terms of the stay ability or the durability of some of that growth, certainly, in the U.S., it’s nice strong performance. There is a little bit of delayed churn, so we can expect to see that hit next year. Other than that, the U.S. is very steady in terms of the demand. Part of that is because of the way the contracts we have work out. When you think of Latin America, we do have higher levels of churn this year than we have had in prior years.
Some of the outperformance is churn driven. So when you think about the LatAm over performance, it’s really a delay in churn and probably not all that durable from that perspective. When you get into APAC, it’s a similar situation. The increase there is delayed churn, maybe some delayed discounts. Europe is staying in line. In Africa, we’re seeing higher levels of new business activity. So much of that is, in fact, durable and lasting, that’s the way I would kind of articulate that. And then maybe on the second question, if you could maybe just repeat the question about the dilution, just so I get it right.
David Barden: Hey. Yeah, Rod. Thank you. So I think we were just trying to – and thank you for those comments, that’s helpful on the pieces part. The — just the India write-down would seem to suggest that the bid-ask spread between what maybe AMT hopes to accomplish from a valuation standpoint and what’s been offered has kind of collapsed down to the offer the side of the spread? And is that the right interpretation or reading through that write-down. And then obviously, we’re all attempting to evaluate what the dilution effect for the sale might be on 2024. Any more color on whether it’s a full divestiture or 50% divestiture and kind of timetable would help us kind of do that math? Thank you.
Rod Smith: Yeah. That’s good, David. Thank you. So we’re making good progress with the strategic review that we’ve set out. In terms of the write-down, we are writing the India business down about $322 million and sets the book value in around $2.2 billion or so. And as I stated in my prepared remarks, it really is based on our internal impairment review analysis, discounted cash flow driven and certainly, cost of capital plays a significant role in that. But also, as I highlighted in my comments, it does also consider indications of value that we’ve determined throughout the process. So I think you can understand what that means, and it will help you kind of think about where things might fit. We’ve also provided a little bit more breakout on the India financials and some of — in the back of the presentation, which you’ll see.
