Financial Data and Key Metrics Changes - In Q4 2024, CommScope reported core net sales of $1.17 billion, a year-over-year increase of 27%, and core adjusted EBITDA of $240 million, a year-over-year increase of 69% [7][34] - For the full year 2024, core CommScope delivered net sales of $4.21 billion, a decrease of 8% from the prior year, with core adjusted EBITDA of $756 million, flat compared to the prior year [8][31] - The company ended the year exceeding its provided core adjusted EBITDA range of $700 million to $750 million [9] Business Line Data and Key Metrics Changes - The CCS segment saw a revenue growth of 36% in Q4, with adjusted EBITDA increasing by 110% [13][37] - The core NICS segment's revenue was up 13% in Q4, with adjusted EBITDA increasing by 285% [20][41] - ANS segment net sales increased by 12% in Q4, but adjusted EBITDA decreased by 27% due to lower software revenue and unfavorable product mix [43][44] Market Data and Key Metrics Changes - The enterprise fiber business within CCS grew 73% year-over-year, representing 22% of CCS revenue in 2024 [14][39] - The data center market is projected to grow at over 30% annually, driven by demand for AI-focused data centers [15][39] - The company expects strong growth in broadband and structured cabling as customer inventory normalizes [18][19] Company Strategy and Development Direction - CommScope is focused on business growth, free cash flow generation, and deleveraging following the sale of its OWN and DAS businesses [11] - The company is investing in new capacity and product development to meet projected market growth, particularly in the data center segment [16][19] - The strategy includes enhancing market share through new product launches and improved customer support [28][60] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in recovery, citing sequential quarterly improvements and positive customer conversations [66][67] - The company anticipates a strong rebound in 2025, with projected core adjusted EBITDA in the range of $1.0 billion to $1.05 billion [10][55] - Management acknowledged challenges in the ANS segment but remains optimistic about upcoming upgrade cycles and product launches [24][45] Other Important Information - The company generated $278 million from cash flow from operations in Q4, with free cash flow of $271 million [47] - CommScope ended the quarter with $663 million in cash and total available liquidity of approximately $1.1 billion [49][50] - The net leverage ratio improved to 7.8x, down from 9.1x in the prior quarter [52] Q&A Session Summary Question: Guidance on core adjusted EBITDA for next year - Management indicated confidence in the recovery, with expectations of over $950 million adjusted EBITDA going forward, driven by data center business and FDX launch [66][67] Question: Market share gains in enterprise fiber business - Management highlighted strong growth in the enterprise fiber business, driven by new products and market demand, with expectations of continued share gains [71][74] Question: Data center business split between hyperscale and traditional enterprise - The data center business is weighted towards hyperscalers, but growth is also coming from other cloud data center customers [82][83] Question: Anticipated rollout of FDX amplifiers - Management expects to ship approximately $300 million worth of FDX amplifiers in 2025, with a significant ramp-up expected in Q2 and Q3 [97][99] Question: Strategic activity post-OWN and DAS sale - Management is focused on running the business and capitalizing on growth opportunities in the data center market and new product launches [103]

CommScope Company (COMM) Q4 2024 Earnings Call February 26, 2025 04:09 PM ET Company Participants Massimo Disabato - Vice President, Investor RelationsCharles Treadway - President and Chief Executive OfficerKyle Lorentzen - EVP & CFOSteven Fox - Founder & CEOSimon Leopold - Managing DirectorMeta Marshall - Managing DirectorPriyanka Thapa - Equity Research Associate Conference Call Participants Matt Niknam - AnalystAna Goshko - Analyst Operator Good day, and thank you for standing by. Welcome to the CommScop ...

For the quarter ended December 2024, CommScope (COMM) reported revenue of $1.17 billion, down 1.4% over the same period last year. EPS came in at $0.18, compared to -$0.02 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $1.11 billion, representing a surprise of +5.35%. The company delivered an EPS surprise of +350.00%, with the consensus EPS estimate being $0.04.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and ho ...

Exhibit 99.1 CommScope Reports Fourth Quarter and Full Year 2024 Results Fourth Quarter Highlights Full Year Highlights * Core financial measures reflect the results of the Connectivity and Cable Solutions (CCS), Networking, Intelligent Cellular and Security Solutions (NICS), and Access Network Solutions (ANS) segments, in the aggregate, and exclude general corporate costs that were previously allocated to the Outdoor Wireless Networks (OWN) segment, Distributed Antenna Systems (DAS) business unit and Home ...

Financial Performance - For the year ended December 31, 2024, the company's revenues were $4.21 billion, with a loss from continuing operations of $461.0 million[22]. - The company reported a net loss for 2024 of $315.5 million, a significant improvement compared to a net loss of $1,506.8 million in 2023[287]. - The company reported a non-GAAP pro forma adjusted EBITDA of $717.6 million for the year ended December 31, 2024, reflecting annualized savings from cost reduction initiatives of $17.4 million[282]. - Non-GAAP adjusted EBITDA for 2024 was $700.2 million, compared to $664.3 million in 2023, reflecting a 5.5% increase[297]. - The Connectivity and Cable Solutions segment achieved an operating income of $466.1 million in 2024, up from $132.8 million in 2023[301]. - The Networking, Intelligent Cellular and Security Solutions segment reported an operating loss of $44.7 million in 2024, compared to an operating income of $57.6 million in 2023[302]. - The Access Network Solutions segment recorded an operating loss of $80.9 million in 2024, significantly improved from a loss of $476.0 million in 2023[303]. Market and Growth Opportunities - The CCS segment generated net sales of $2.8 billion, accounting for 67.2% of total revenues, while the NICS and ANS segments contributed $0.6 billion (13.1%) and $0.8 billion (19.7%) respectively[23][24][25][26]. - The company anticipates continued growth in demand for connectivity driven by the rise of AI, cloud computing, and high-performance computing, necessitating rapid innovation in data center design and technology[32]. - The shift towards network convergence is expected to continue, with operators integrating voice, video, and data communications into a single network architecture[30]. - The company focuses on high-growth opportunities such as fiber optic connectivity, Wi-Fi 7, and 5G network solutions[69]. - Government-sponsored broadband improvement programs are expected to drive technology and device sales, particularly in the U.S., with more funds anticipated in 2025[31]. Innovation and Product Development - CommScope NEXT initiative has positively impacted net sales, profitability, and cash flow, with expectations for further improvements as demand recovers[41]. - The company plans to introduce new products and scale software solutions to meet growing market demands[48]. - The transition to Wi-Fi 7 is anticipated to deliver high throughput and low latency, enabling advanced applications such as XR and 4K/8K streaming[40]. - The company invested $316.2 million in research and development (R&D) during 2024 to advance product innovation and decrease total cost of deployment and ownership[59]. Financial Position and Cash Flow - As of December 31, 2024, the company had an order backlog of $977.1 million, up from $860.1 million in 2023[70]. - The company expects a majority of its backlog as of December 31, 2024, to be recognized as revenue during 2025[70]. - Cash and cash equivalents increased by $119.5 million during 2024, with approximately 42% held outside the U.S.[283]. - Net cash generated by operating activities for 2024 was $273.1 million, a decrease of 8.1% from $297.3 million in 2023[286]. - Cash used in investing activities for 2024 was $(57.2) million, a significant decrease from $30.9 million generated in 2023[286]. - Capital expenditures for 2024 totaled $26.2 million, with a notable reduction in capital expenditures related to discontinued operations[285]. Debt and Financing - The company anticipates total interest payments on long-term debt to reach $2,906.8 million, with $613.5 million due in 2025[279]. - In 2024, the company repaid $4,338.6 million in long-term debt and issued $4,350.0 million in new long-term debt[290]. - The company completed refinancing transactions including the issuance of $1,000 million in senior secured notes and a new senior secured term loan facility of $3,150.0 million[290]. - The company incurred $59.4 million in original issuance discount and $33.1 million in debt issuance costs related to refinancing transactions in 2024[290]. Customer Relationships and Market Competition - Approximately 19% of consolidated net sales for the year ended December 31, 2024, were derived from the top two direct customers[50]. - The company operates in a highly competitive market with significant domestic and international competition across all segments[56]. - The company maintains long-term relationships with key customers, which helps mitigate risks associated with customer purchasing variability[54]. Goodwill and Impairment - As of January 1, 2024, the company assessed goodwill for impairment and determined that no impairment existed following the reallocation of goodwill after changes in reporting units[311]. - The annual goodwill impairment test for 2024 indicated that the fair value of each reporting unit exceeded its carrying value, with a discount rate range of 9.5% to 14.5%[312]. - The ANS reporting unit has low headroom, posing a risk for future impairment if economic conditions decline or cash flow forecasts decrease materially[313]. - The company reported a goodwill balance of $266.0 million as of December 31, 2024, with a 3.0% excess of fair value to carrying value for the October 1, 2024 test[315]. Revenue Recognition and Accounting Policies - Revenue is primarily generated from product sales, which account for over 90% of total revenue, recognized at the point of shipment[318]. - Revenue recognition follows a five-step approach as defined in ASC 606, ensuring accurate timing and amount of revenue recognized[317]. - The company maintains reserves for inventory based on market conditions, which could lead to material impacts on operations if actual conditions deteriorate[323]. - The company establishes income tax valuation allowances when it is more likely than not that deferred tax assets will not be realized, impacting earnings if adjustments are necessary[324]. - Legal fees related to lawsuits are expensed as incurred, and loss contingencies are accrued when losses are probable and estimable[321]. - The company recognizes income tax benefits only when it is more likely than not that the tax position will be sustained, requiring significant judgment[326].

Group 1: Partnership and Market Expansion - CommScope has partnered with the National Content & Technology Cooperative (NCTC) to enhance broadband access for independent service providers in remote areas of the U.S. [1] - The partnership aims to bridge the technology gap for independent broadband and TV service providers, enabling easier access to advanced network solutions [1][3]. - NCTC serves one-third of all U.S. households and has a strong presence across all 50 states, which will help expand CommScope's market reach [4]. Group 2: Product Offerings and Support - CommScope will provide its Build America, Buy America compliant portfolio and assist NCTC in securing funding under the Broadband Equity Access and Deployment (BEAD) program [3]. - The company offers a comprehensive suite of infrastructure solutions, including wireless and fiber optic technologies, to support FTTH network deployment in underserved areas [3]. Group 3: Financial Performance and Stock Movement - CommScope's shares have increased by 153.4% over the past year, outperforming the industry growth of 44.8% [6]. - Despite the positive stock performance, the company faces challenges such as inventory adjustments and weak demand in certain segments [5].

Core Insights - CommScope has announced a collaboration with the National Content & Technology Cooperative (NCTC) to enhance access to its network solutions for NCTC members, focusing on broadband deployment in rural and underserved areas [1][2][3] Group 1: Partnership Details - The collaboration will provide NCTC members with improved purchasing options for CommScope solutions through a dedicated distribution partner [3] - CommScope will assist NCTC members in navigating the Broadband Equity Access and Deployment (BEAD) program funding for financing rural Fiber-to-the-Home (FTTH) network deployments [3] - This partnership aims to streamline access to CommScope's Build America, Buy America (BABA)-compliant portfolio of FTTH solutions for independent service providers [4] Group 2: Commitment to Broadband Access - CommScope emphasizes its commitment to making broadband access a reality for service providers of all sizes, ensuring that no community is left behind in the digital society [4] - The collaboration is designed to empower NCTC members with the necessary tools and partnerships to deliver high-quality broadband to their communities [4][7] - NCTC represents nearly 700 independent cable and broadband operators, collectively reaching about one-third of connected households in the U.S. [2][7] Group 3: Product and Service Offerings - CommScope's network solutions are intended to help NCTC members improve, upgrade, and manage their access networks and broadband deployments efficiently [4] - The partnership will provide a comprehensive suite of CommScope products and services available in NCTC's online store, Marketplace [4]

Core Viewpoint - CommScope Holding Company, Inc. has completed the divestiture of its Outdoor Wireless Networks (OWN) and Distributed Antenna Systems (DAS) businesses to Amphenol Corporation for approximately $2.1 billion, allowing the company to focus on its core operations and improve financial stability [1][2][4]. Financial Impact - The divestiture proceeds will be used to fully repay outstanding amounts under CommScope's asset-backed revolving credit facility and to repay senior secured notes due in 2026 and partially for those due in 2029 [3]. - As of September 30, 2024, CommScope had $392.1 million in cash and cash equivalents against $8 billion in long-term debt, resulting in a debt-to-capital ratio of 155.8% [5][6]. Strategic Focus - The divestiture is part of a broader strategy to enhance operational efficiency and prioritize core businesses, following the earlier divestiture of the Home Networks business to Vantiva [4]. - The acquired businesses are projected to generate around $1.3 billion in net sales in fiscal 2025, indicating a strong potential for Amphenol [2]. Stock Performance - CommScope's shares have increased by 139.2% over the past year, significantly outperforming the industry growth of 45.2% [7].

Group 1 - The article discusses the performance of CommScope Holding Company (NASDAQ: COMM), noting that the stock was recovering from its all-time lows at around $1.73 [2] - The author previously recommended a Hold position on CommScope, anticipating potential further declines in performance [2] Group 2 - The author expresses a strong interest in studying market dynamics, company growth, and long-term investment opportunities [2]

Core Insights - CommScope Holding Company, Inc. reported disappointing third-quarter 2024 results, with both adjusted earnings and revenues falling short of Zacks Consensus Estimates [1] Financial Performance - The company experienced a year-over-year revenue increase, primarily driven by improved sales in the Connectivity and Cable Solutions (CCS) segment, but faced challenges from lower capital spending, inventory adjustments, and weak demand in various sectors [2] - On a GAAP basis, the net loss for the third quarter was $49.4 million, or a loss of $0.23 per share, compared to a net loss of $844.2 million, or a loss of $3.98 per share in the same quarter last year [3] - Non-GAAP net loss was $13.2 million, or a loss of $0.05 per share, compared to a net loss of $30.3 million, or a loss of $0.12 per share in the prior-year quarter, missing the Zacks Consensus Estimate by $0.38 [3] Revenue Breakdown - Net sales for the quarter were $1.08 billion, up from $1.05 billion a year ago, but missed the consensus estimate of $1.43 billion [4] - Revenues in the CCS segment increased by 16.8% to $736.7 million from $630.5 million in the previous year, driven by strong demand in the hyperscale and cloud business [4] - Sales in the Networking, Intelligent Cellular and Security Solutions (NICS) segment, excluding Distributed Antenna Systems (DAS), decreased by 22.3% year over year to $157.5 million [5] - Access Network Solutions (ANS) segment revenues were $188 million, down 14.7% year over year [5] Regional Performance - Revenues in the United States increased by 3.1% year over year to $714.6 million [6] - Europe, the Middle East, and Africa reported revenues of $159.3 million, up 4% from the previous year [6] - Asia Pacific revenues were $126.6 million, up 0.4% year over year [6] - Caribbean and Latin American revenues fell by 5% year over year to $47.5 million, while Canadian revenues increased by 10.3% year over year to $34.2 million [6] Strategic Developments - CommScope entered into a definitive agreement with Amphenol Corporation for the divestiture of its OWN segment and DAS business unit, expected to close in the first half of 2025 for approximately $2.1 billion in cash [7] Operational Metrics - Gross profit increased to $435.1 million from $380.2 million in the prior-year quarter, with total operating expenses declining to $337.3 million from $788.6 million [8] - The company recorded an operating income of $102.2 million compared to an operating loss of $408.4 million a year ago [8] - Non-GAAP adjusted EBITDA was $204.2 million, up 30.2% year over year, driven by the strength in the CCS segment [8] Cash Flow and Outlook - In Q3 2024, CommScope generated $122.2 million in cash from operating activities, down from $138.8 million in the prior-year period [9] - As of September 30, 2024, the company had $392.1 million in cash and cash equivalents and $8 billion in long-term debt [9] - For 2024, management expects core adjusted EBITDA in the range of $645-$695 million, with breakeven adjusted free cash flow anticipated [9]