Uniti Group Inc. (NASDAQ:UNIT) Q2 2023 Earnings Call Transcript

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And over the past, I’d say, quarter or so, we’ve made a tremendous amount of progress and we’re adding to that team in a very disciplined, but steady way, and that’s what’s contributing to that 15% a year-over-year enterprise growth. And the bookings are equally strong and the funnel is strong as well. So it’s a constant battle to find good talent and to bring them on and train them and get them up to being productive. But I think we’re very good at it, Frank, and excited about continuing to push that forward. .

Operator: Our next question comes from the line of Simon Flannery with Morgan Stanley.

Unidentified Analyst: This is [indiscernible] Simon today. Can you remind us whether 2025 is still where you expect free cash flow to inflect? And then secondly, can you speak to anything you’re seeing with DISH? I know last quarter, you mentioned they remained active, but are you seeing any changes there?

Paul Bullington: Alan, this is Paul. I can take the first question and maybe, Kenny can take the second question on DISH. But yes, the quick answer to your question is, yes, 2025, we still see that as an inflection point for free cash flow. And part of that is just continuing to execute on our growth plan, mid-single-digit growth. As Kenny talked about in his comments, that’s very predictable given and our visibility to that is very good given our funnel and our sales force and the demand for our products and services and the breadth of use cases for our products and services, as Kenny said, but the bigger part of that journey to free cash flow positive here over the next year to 2 years into 2025 is just the mechanics of our commitments to Windstream with regard to the settlement expenses that fall off the middle of that year in 2025 and GCI commitments start to ratchet down in terms of the total annual capital commitment over time and the revenue from those GCI investments steps up over time so that is positive for our cash flow and helps us to get to that inflection point.

So that’s still our plan.

Kenneth Gunderman: Yes, a lot on DISH, we don’t like to comment too much on specific customers with much detail. But on — but I would say and I mentioned earlier that we expected wireless bookings to be down 50% this year versus 2022. A big part of that is 2022 was a tough comp because bookings from DISH were so elevated in 2022, just getting ahead of the network spend that they needed to make. And so as a result, bookings there are lower this year. But with that said, that’s I think that’s expected based upon the deadlines and time lines that they had in order to — that they had to meet. So with that said, I think activity with them is remains very robust and really as expected as predicted. .

Unidentified Analyst: Maybe one more quick one. Have you made any traction or any updated thoughts on your diversification maybe away from one stream or anything else we should be thinking about there? Or .

Kenneth Gunderman: Yes. I would just refer back to my comments at the beginning regarding M&A. I think we continue to focus on it. It’s a core competency of ours, and we’ve had periods of time when we’ve been very active in periods of time when we’ve been very patient. And right now, we’re in the latter category with respect to what the market perceives anyway, but behind the scenes, we’re very active, and that’s always going to be the case for us. So it’s a core competency and it’s something we’re going to continue to focus on. .

Operator: I’m showing no further questions in the queue. I would now like to turn the call back to Kenny for closing remarks. .

Kenneth Gunderman: Thank you. We appreciate your interest in Uniti Group and look forward to updating you further on future calls. Thank you for joining us today. .

Operator: Ladies and gentlemen, this concludes today’s conference call. Thank you for your participation. You may now disconnect.

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