Windstream reported its 1Q 2020 financial results today, sharing what it calls record breaking broadband results. Residential broadband is helping the carrier improve its financial results and will be key to its future as the carrier emerges from bankruptcy later this year.
Windstream added a net 18K broadband subscribers in 1Q 2020, its highest ever quarterly result in new net broadband adds, Windstream CEO Tony Thomas announced. Importantly, demand for broadband has increased during the pandemic, Windstream reported, with 10K of these net broadband adds occurring in March 2020 alone.
“Our broadband subscriber growth increased 58% year-over-year and accelerated throughout the quarter as we added almost ten thousand subscribers in the month of March alone,” said Windstream CEO Tony Thomas on today’s earnings recording. “This market share growth has been driven by our continued improvement in broadband speed capability across our Kinetic ILEC footprint.”
Windstream’s project Excel, launched several years ago, focused on improving broadband speeds across its footprint. Windstream now reports that 70% of ILEC homes can receive speeds of up to 25 Mbps, and 43% can receive speeds of up to 100 Mbps.
Importantly for Windstream, only 36% of households who can get 25 Mbps actually subscribe to the service. Only 28% who are eligible for 100 Mbps currently subscribe to it, suggesting Windstream has a decent opportunity to increase broadband market share. The carrier’s full 2020 guidance calls for 40K net broadband adds.
Windstream sees this opportunity as key to its emergence from bankruptcy. That includes making 1 Gbps capable broadband available to 50% of its ILEC footprint over the next ten years.
Restructuring has given Windstream the financial flexibility to achieve this goal, Thomas noted. In addition to shedding debt through restructuring, Windstream reached a settlement with its REIT partner Uniti. That settlement calls for Uniti to invest $1.75 billion in Windstream’s network over the next ten years.
“Given this investment strategy, our record breaking first quarter broadband net adds, and the revenue growth seen in Kinetic during this first quarter have us well positioned to capitalize on the Kinetic network investment plan going forward.,” said Thomas.
He also noted that the heightened awareness of rural broadband thanks to the pandemic should help Windstream, especially if additional rural broadband funding vehicles emerge.