David Barden : The first one, maybe, Matt, could we refresh the free cash flow outlook for 2023? I think the midpoint was $21 billion for 2023 from last year’s Analyst Day. I think if we look at the EBITDA guidance, which is roughly flat; interest expense guidance, which is up $1 billion; the CapEx, which is down $4 billion, it feels like it should be roughly $17 billion, unless there’s other things in taxes and working capital related to some of these promotions. So if you could kind of refresh that a little bit, that would be awesome. And then Hans, you called out three things as it relates to the C-band deployment. And this has been a big success for Verizon is getting this build done. I think that some people have been asking themselves like where the return is from all the money that’s been spent.
And you highlighted higher retention, better gross adds and higher premium take rate. Are there numbers that you can put around that, that we could grab on to and say, “Oh, when in 2024, Verizon doubles their footprint in C-band with the new spectrum getting cleared, we can put a number on that and say, “Oh, this is going to be the return that Verizon gets from this build?”
Hans Vestberg : Why don’t you start, Matt, and I take the second question on the C-band.
Matthew Ellis : Yes. So on the free cash flow, David, obviously, last year, we said that we expect — you had the right number expectation of where we said free cash flow might be for $23 million. As I think about what we see the business today versus where it was a year ago, a couple of factors that are different. CapEx very much in line with where we thought it would be at this point. Team did a great job last year deploying C-band. And obviously, we spent most of the $10 billion. So you get a nice year-over-year benefit. Offsetting that cash taxes will be higher this year as we have less benefit from a higher CapEx number and also both appreciation dropping down. That was in our expectation last year. Interest rates were obviously very different than we expected last year.
You touched on those. And then the jump-off point from the EBITDA and the business at the end of ’22 to ’23 lower than we hoped to be at the Investor Day a year ago. So you’ve got the right moving parts there. We’re not guiding specifically to a cash flow number. We historically haven’t. But you’ve got the right moving pieces in there. So net-net, the CapEx reduction year-over-year gives us a good tailwind to think about cash flow for this year. So with that, I’ll hand you to Hans for the C-band question.
Hans Vestberg : Yes. And it’s, of course, a focus for us to continue to grow the cash flow, as I said so many times. So we will continue on that work. When it comes to the C-band, first of all, we have said from the beginning, the C-band acquisition we did is a multi-decade spectrum. It’s going to — it’s so much and in so many years. And of course, that was a deliberate decision because we believe we’re going to be in wireless business for the eternity of Verizon’s history. So that’s very important. However, when it comes to C impacts, and I think I mentioned some of them, if you think about fixed wireless access, the majority of all new customers are coming on the C-band right now. That’s a clear indication. Without the C-band, we couldn’t grow the broadband right now.
