WideOpenWest (WOW), a leading broadband provider, disclosed its financial outcomes for the fourth quarter of 2023, revealing both growth in high-speed data revenue and a decline in total revenue year-over-year (YoY).
The company reported a slight increase in high-speed data revenue to $108.7 million, up by 1.5% YoY, while total revenue fell by 6.5% YoY to $168.8 million. Despite a decrease in high-speed data (HSD) subscribers, WideOpenWest achieved a record high in HSD average revenue per user (ARPU) at $72.90 and expanded its network to pass 48,400 new homes.
The company's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) saw a 4.6% decrease YoY to $71.2 million, but boasted a record adjusted EBITDA margin of 42.2%. Looking ahead, WOW anticipates an improvement in HSD subscribers and projects HSD revenue for Q1 2024 to be in the range of $104 million to $107 million.
Key Takeaways
- High-speed data revenue increased by 1.5% YoY to $108.7 million.
- Adjusted EBITDA decreased by 4.6% YoY to $71.2 million.
- The company passed 48,400 new homes, marking a significant expansion.
- HSD ARPU reached a new high of $72.90.
- Total revenue declined by 6.5% YoY to $168.8 million.
- WOW expects HSD subscriber improvement and projects Q1 HSD revenue between $104 million and $107 million.
Company Outlook
- WOW is on target for $35.5 million in cost reductions by the end of 2025.
- The company aims for positive free cash flow by the end of the year.
- Infrastructure investments include upgrades for DOCSIS 4.0 and fiber-to-the-home.
- WOW is confident in reversing subscriber trends in legacy markets and continuing growth in greenfield markets.
Bearish Highlights
- The company experienced a decline in traditional video business as it transitions to YouTube TV.
- Total outstanding debt stands at $934.5 million.
Bullish Highlights
- Positive early indicators in legacy markets due to efforts to stabilize subscriber losses.
- Strong penetration rates in Greenfield and Edge-out markets.
- Record adjusted EBITDA margin of 42.2%.
- 99% of ACP customers opting to continue services post-program.
Misses
- HSD subscribers decreased by 13,300 in Q4.
- Total revenue saw a 6.5% YoY decline.
Q&A Highlights
- Teresa Elder, CEO, emphasized the importance of both greenfield and legacy markets in contributing to subscriber net adds.
- The company is not overly concerned with competition from telco fiber in their footprint.
- Criteria for selecting new markets include competition, home density, build cost, market growth, and launch speed.
- Reduced CapEx of $60 million for greenfield markets is planned for the year.
In summary, WideOpenWest is navigating through a mixed financial landscape but remains focused on expanding its customer base and improving its financial health. The company's strategic investments and cost-saving measures are expected to drive growth and improve liquidity in the coming quarters.
With the anticipation of an improved broadband subscriber trajectory and a proactive approach to market challenges, WOW's ticker remains a point of interest for investors monitoring the telecommunications sector.
InvestingPro Insights
WideOpenWest's recent financial results have shed light on the company's performance and strategic direction. To provide further context, here are some insights from InvestingPro that could be of interest to investors:
InvestingPro Data highlights a market capitalization of $258.97 million for WideOpenWest, indicating the size and scale of the company within the telecommunications sector. Despite the challenges, the company's gross profit margin remains strong at 57.26% for the last twelve months as of Q4 2023, showcasing its ability to maintain profitability in its core operations. Still, the revenue growth has experienced a slight decline, with a -2.58% change over the last twelve months as of Q4 2023.
Among the InvestingPro Tips that stand out, WideOpenWest is noted to have a significant debt burden, which aligns with the disclosed total outstanding debt of $934.5 million in the article. This factor is critical for investors to consider as it may impact the company's financial flexibility and future growth potential. Moreover, the company's management has been aggressively buying back shares, a move that can signal confidence in the company's prospects and potentially enhance shareholder value.
For investors seeking more in-depth analysis, there are additional InvestingPro Tips available for WideOpenWest. These tips delve into various aspects of the company's financial health and market performance, providing a more comprehensive understanding of its investment profile. To access these insights, investors can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.
The InvestingPro product offers a total of 11 tips for WideOpenWest, covering a wide range of metrics from cash flow concerns to analysts' profitability predictions. These tips, combined with real-time data, can empower investors to make more informed decisions regarding their interest in WideOpenWest's stock.
Full transcript - WideOpenWest Inc (WOW) Q4 2023:
Operator: Thanks for standing by and welcome to the WideOpenWest Fourth Quarter 2023 Earnings Call. I would now like to welcome Andrew Posen, Vice President, Head of Investor Relations to begin the call. Andrew, over to you.
Andrew Posen: Good morning, everyone, and thank you for joining our fourth quarter of 2023 earnings call. With me today is Teresa Elder, WOW's Chief Executive Officer; and John Rego, WOW's Chief Financial Officer. Before we get started, I would like to remind everyone that during our call, we will make some forward-looking statements about our expected operating results, our business strategy, and other matters relating to our business. These forward-looking statements are in reliance on the safe harbor provisions of the federal securities laws and are subject to known and unknown risks, uncertainties, and other factors that may cause our actual operating results, financial position, or performance to be materially different from those expressed or implied in our forward-looking statements. You are cautioned not to place undue reliance on such forward-looking statements. We disclaim any obligation to update such forward-looking statements. For additional information concerning factors that could affect our financial results or cause actual results to differ materially from our forward-looking statements, please refer to our filings with the SEC, including the risk factors section of our Form 10-K filed with the SEC, as well as the forward-looking statement section of our press release. In addition, please note that on today's call and in the press release we issued this morning, we may refer to certain non-GAAP financial measures. While the company believes these non-GAAP financial measures provide useful information for investors, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Reconciliation between GAAP and non-GAAP metrics for our financial reported -- for our historical reported results can be found in our earnings releases and our trending schedules which can be found on our website. We have also included the presentation this afternoon to complement our prepared remarks. Now I'll turn the call over to Teresa Elder, WOW's Chief Executive Officer.
Teresa Elder: Thanks, Andrew. Welcome to WOW's fourth quarter earnings call. We are continuing to build momentum in our market expansion initiative and we are seeing positive early indicators in our legacy markets in response to the efforts we are taking to stabilize subscriber losses. Our fourth quarter results include high-speed data revenue of $108.7 million, up 1.5% year-over-year, adjusted EBITDA of $71.2 million, which decreased 4.6% year-over-year, but increased sequentially for the third consecutive quarter and a record adjusted EBITDA margin of 42.2%, which increased steadily throughout the year. For the full-year, our high-speed data revenue increased 4.4% from the last year to $430.4 million, while adjusted EBITDA declined by 1.7% to $275.4 million, with an adjusted EBITDA margin of 40.1%. The pace of construction in our Greenfield and Agile markets accelerated throughout the year, culminating in a total of 48,400 new homes passed, including 30,400 in our Greenfield markets and 18,000 new homes passed in Edge-outs. In fact, our fourth quarter was the most robust quarterly expansion of our network in our 25-year history. We passed nearly as many homes in the fourth quarter alone as we did throughout the first three quarters of the year. Our momentum has continued through early 2024 as we have added over 10,000 more homes as part of our expansion initiative so far this year, predominantly in our greenfield markets. I am extremely proud of the effort of our team that is driving our expansion, which is central to our growth strategy. I'm not the only one who recognizes the quality of WOW. U.S. News and World Report just named WOW a best Internet service provider of 2024. Out of a list of 25 providers offering all types of Internet across the U.S., including fiber, cable, digital subscriber lines, satellite, fixed wireless, and 5G home Internet services, WOW ranked first for fastest cable upload speeds. Second for best cable internet service providers, and fourth overall. This is the proud moment for our team and we will continue to prioritize innovation and customer satisfaction in this competitive marketplace. Our HSD subscribers losses during the fourth quarter of 13,300 were in line with the expectations that we set on our last call as the macro environment continued to be challenging. Low move activity, higher churn, in lower speed tiers, and ongoing competitive threats from fixed wireless carried into the fourth quarter, but have begun to improve in the first quarter as a result of several steps that we took to address these challenges. Specifically, we increased our minimum speed for existing customers to 300 meg, giving them a surprise boost in their broadband speed at no additional cost. We gave a surprise boost as well to the 500 meg customers. Second, we introduced a simplified pricing option, which includes a price lock, free modem, no data caps, or contracts. This surprise-free approach has been extremely well received. Third, we strategically offered short-term extensions to help create a soft landing for customers rolling off promotions. The early success of these steps has given us additional confidence in the progress we are making to strengthen our subscriber numbers in our legacy footprint. The chart on the lower left quadrant on the slide shows a small increase in the proportion of new customers buying in the lower tiers. This shift during the quarter did not limit the growth in HSD ARPU, as a majority of new customers across our legacy markets, Edge-outs, and especially in Greenfield markets, continue to buy 500 meg and above. The chart on the lower right-hand side of the slide shows our HSD ARPU reaching a new high of $72.90. We expect HSD ARPU will increase further in 2024. Although the rate of growth will likely ease as the impact of the steps we're taking to address subscriber churn work their way to our financials. As of the end of the fourth quarter, we now have more than 490,000 HSD subscribers. As expected, our traditional video business declined further during the quarter, which will continue as we transition to YouTube TV. As mentioned, this YouTube TV partnership provides a fantastic opportunity to provide our customers more content at a much better value and to capitalize on the shift to video streaming, which we believe will also contribute to great results this year. Our penetration rates remain strong in our Greenfield markets and the early positive reception reinforces our conviction and commitment to our expansion strategy. Our 2023 Edge-out vintage has a penetration rate of 24.4%, while the 2021 and 2022 vintages also continue to report strong penetration rates of 47.6% and 31%, respectively. Penetration rates in our Greenfield markets decreased to just under 10% in the fourth quarter, because we significantly increased the number of homes passed late in the quarter. However, the cohorts are demonstrating extremely strong penetration rates, averaging more than 20% within the first six months after activation. To conclude, before handing the call to John, I want to reiterate the key points that I made at the outset of this call. First, we continued to make great progress in our expansion markets, passing 48,400 new homes in both Greenfield and Edge-Out markets through December 31, and more than 10,000 homes so far this year. Second, we took steps during the quarter to stabilize the losses in our legacy footprint and improvements are evident in our expectations for the first quarter. And lastly, we continue to see positive reception to our YouTube TV offering. Now I'll turn the call over to John, who will go over our financial results in more detail.
John Rego: Thanks, Teresa. In the fourth quarter, we reported $108.7 million of HSD revenue, which increased 1.5% year-over-year, reflecting the impact of the respective rate increases, as well as new and existing customers upgrading to higher speed tiers. The growth in HSD revenue was more than offset by a 19.7% and 4.8% drop in video and telephony revenue respectively resulting in a 6.5% decline in total revenue from the same period last year to $168.8 million. Adjusted EBITDA decreased 4.6% from the same period last year to $71.2 million with a record adjusted even a margin of 42.2%, driven by the increase in higher margin HSD revenue. The incremental contribution margin increased sequentially and continue to grow year-over-year driven by the proportionate increase in HSD revenue, which increased to 64% of our total revenue this quarter, up from 59% in the same period last year. Now for a progress update on our cost structure alignment. We continue to be on pace to hit our target of $35.5 million by the end of 2025. As of the fourth quarter, our total savings equate to $28.8 million, which represents approximately 81% of the $35.5 million we identified for cost reduction over the next few years. In addition to these measures, we also made further headcount reductions, predominantly in our corporate and administrative areas. We made significant progress on realizing savings across the company, and we'll continue to be diligent as we manage costs despite the higher inflationary environment. We ended the quarter with total cash of $23.4 million and total outstanding debt of $934.5 million with our leverage ratio at 3.3 times. We reported total capital spend of $80.6 million, which is up $27.9 million from last year. Our core CapEx efficiency was 23.6% in the fourth quarter and 19.9% for the year. Expansion CapEx increased $26.3 million from the same period last year as we continued to invest in our future growth, bringing fiber-to-the-homes of Central Florida and Greenville County, South Carolina. In the fourth quarter, we spent $33.8 million on Greenfields, $3.4 million on Edge-outs and an additional $3.6 million on business services. Our unlevered adjusted free cash flow, which we define as adjusted EBITDA less CapEx, decreased to negative $9.4 million in the fourth quarter, almost entirely driven by higher expansion spend predominantly on Greenfields. For the full-year, we reported $6.5 million in adjusted unlevered free cash flow, which is down significantly from last year. We are undertaking several steps to increase our free cash flow in 2024. In 2023, we invested $132 million in market expansion with a significant portion of the upfront spend to support the entrance to our new markets. This year, we plan to spend approximately $60 million, predominantly focused on testing new homes, leveraging the investment spent last year in these markets. In addition to managing our expansion spend, we will continue to be particularly targeted in our network spending as we strategically identify areas within our infrastructure that will immediately benefit from investment whether it is upgrading in support of DOCSIS 4.0 or fiber-to-the-home upgrades. We also executed hedges on $500 million of our long-term debt, which will help us manage our annual interest expense in 2024. Combined, we believe these efforts should put us back in a position of generating free cash flow by the end of this year. Finally, before we open the call for questions, I'd like to provide our expectations for the first quarter. As Teresa indicated in her comments this morning, we're seeing some positive indications from the steps we are taking to address the challenges in our legacy markets, and we believe that we will see further improvements throughout the year. For the first quarter, we expect HSD subscribers to be between negative 2,000 and negative 500, a significant improvement from the fourth quarter. We believe HSD revenue will be between $104 million and $107 million. We expect total revenue for the first quarter to be between $159 million and $162 million and adjusted EBITDA to be between $64 million and $67 million. And now we'd like to open up the line for questions.
Operator: The floor is now open for your questions. [Operator Instructions] The first question comes from the line of [Chris Joel] (ph) with UBS. Please go ahead.
Unidentified Analyst: Great. Thank you for taking the questions. You guided to an improved broadband subscriber trajectory in 1Q. I recognize you highlighted the steps you're taking to mitigate the impact of fixed wireless. But can you help us think through maybe other factors that contributed to the 4Q results that you don't expect to repeat here in 1Q? And given what's going on with the ACP program, can you help us size your ACP exposure and how you're thinking about mitigating churn there, funding does lapse? Thank you.
Teresa Elder: Thanks, Chris. I'll go ahead and get started. This is Teresa. And so I do not believe we will see any repeat of the fourth quarter. Fourth quarter, as we said in our last call, what we were telling you what was coming was unusual, because we had just come off a large rate increase, and we were also seeing significant promo roll-offs from the customers. We've taken significant steps, as I outlined in my remarks, to really address that, and we saw improvement coming out of the end of the fourth quarter and certainly in the fourth -- first quarter. So those steps, again, are really focused on a soft landing for our promo roll-off customers, the simplified pricing that we have done that is really attracting great attention from both existing and new customers, as well as the upgrades of speed tiers that we did as a surprise and delight for our existing base. All of those are really getting tremendous traction. And I think hit the sweet spot of what customers really want. On the simplified pricing, we did significant research. We really know what customers want, and that is that consistency and pricing, I think we hit a great, sweet spot there with the pricing, with the tiers not having any kind of surprised fees and giving them an option if they want to do a price lock for the future. So a very different approach, I think, than some others have taken and customers are responding well. So we feel very good about Q1 and really the results for the rest of the year as we think about the greenfield homes that are coming on. I believe your second question was about ACP. And yes, we've been watching that news closely and certainly preparing for that. We currently have 30,000 customers who are on the ACP program. 99% of those have opted in to continue services with WOW when the program ends. And we feel some certainty of that, and we'll have to see what happens in the future. but about 82% of our ACP participants were existing WOW! customers prior to enrolling in the ACP and many use this really to up-tier to higher services. So it's hard to say exactly what's going to happen, but we feel that we should be okay in terms of the subscriber side, and we'll continue to offer attractive pricing so that hopefully, we won't see much of any hit from the revenue side, but more to come since that hasn't been implemented yet.
Unidentified Analyst: That's very helpful. Thank you. And then if I could just do one follow-up. There's been a lot of focus on fixed wireless, but can you maybe just remind us where telco fiber overlap is in your footprint today and how you expect that to evolve this year?
Teresa Elder: Yes. We have continued to have some telco overlap. It's grown a bit. It's still not one of the largest, I think, compared to our peers. I think generally, fiber is deployed in areas where they know they can get a good return. And given that we are an additional provider to the incumbent in our markets, it's usually not the most financially beneficial to come in with another alternative in our footprint. So we compete extremely well with that. And so I feel good about our ability to compete with fiber where it is but we do that every day. So not a huge concern of ours.
Unidentified Analyst: Great. Thanks again for all the color.
Operator: Our next question comes from the line of Frank Louthan with Raymond James. Please go ahead.
Frank Louthan: Great, thanks. So you continue to build a lot outside your market. Can you give us some color on some of those bills and how that is expected to kind of drive adds going forward? I mean in theory, those should be relatively easy adds. Last year, we saw more base erosion there. Is there a point where you think that's going to shift? And what is the competitive issue in the larger -- in your larger legacy markets that's kind of still overwhelming the base builds or the new builds here? Thanks.
Teresa Elder: So I think, I understand the question, but Frank, I know you'll correct me if I don't quite understand it. So talking about the new builds and the new markets, we are driving penetration very quickly, 20% within six months. Those are very attractive markets. The reception that we're getting is extremely strong, and we feel great about the pace of the construction. Last year, we really focused a lot on many of the upfront aspects of that construction, be it the warehouses, getting the inventory there, getting all of the initial work, the hubs, everything -- the locations for the hub side, all those things in place. So now this year, we really are cranking homes passed, and that is going extremely well. In terms of the legacy markets, we have both some edge out additions that we've done that we added last year and continue to add some this year as well. As well as the work that we're doing that I outlined on the previous question, to really kind of direct competition and turn around some of the losses that we've seen in those markets. And I feel like we are making significant progress, both on the legacy side of the business. and certainly continuing to accelerate momentum on the greenfield side. So did I get the essence of your question, Frank?
Frank Louthan: Well, I mean it seems like the bigger issue is the losses in the base that are overwhelming the newbuilds. And can you point to -- is there a point in the future where that's going to cross where you're going to be able to see -- you're spending a lot of money and still losing subscribers. At what point can we see that start to work in the right direction? And it seems like the bigger drag is the legacy business. And I mean, I hear what you said about some of the changes and so forth, but what gives us confidence that this one is going to stick?
Teresa Elder: Yes. No, I think that's a great point. So I mean, in the legacy business, of course, we have 1.9 million homes, and we've added another 30,000 in greenfield. So just the scale there is significant. But what we are seeing coming out of the fourth quarter and certainly into the first quarter is a reversal of some of the trends in the legacy business and then the continued expansion and growth that we're seeing in the Greenfield. So I do think we see a point in the future where that starts to cross and we start to see the business growing again.
Frank Louthan: Is that this year? Or is that next year? At what point will that be?
Teresa Elder: We're not giving guidance really for HSD net adds for the rest of the year. For the first quarter, we've substantially improved over the fourth quarter saying negative 2,000 to negative 500 adds, that's also an improvement, I believe, over the first quarter of last year. So we believe it is within our grasp, and we'll just have to continue to see how things play out with all the many tactics and new strategies that we put in place, but we are feeling good about the momentum we've got so far.
Frank Louthan: Okay, thank you.
Operator: Our next question comes from the line of Dan Day with B. Riley Securities. Please go ahead.
Dan Day: Yes, good morning guys. Appreciate you taking the questions. So I know you track pretty closely when people turn out the reason for it and where they're going you just talk about in the fourth quarter, where some of these customers want? Was it still mostly the low end? Is there being the fixed wireless? Was that sort of the most common response that you got or -- anything to call out in terms of increased competitive pressures from the larger peers with these wireless bundles?
Teresa Elder: Yes. The majority of the places our customers go is not to fixed wireless. I think we talked about that last quarter and brought it up because it was the first time it was even much of a blip on the radar. It hadn't been much for us previously. So the majority of customers who churn in and out of wow will go to Comcast (NASDAQ:CMCSA) or Charter, who are our biggest competitors every day kind of all day. And so we feel like we created a bit of an opportunity, because we had done the rate increase last year. And we also, at the same time, had some customers rolling off of promo. So we've really done some things to, I think, shore up the certainty of pricing, competitiveness of that and just simplified it for customers. They want that certainty going forward, and I think we're really addressing some of those kinds of things. So we've seen churn really step down this quarter in the first quarter. And of course, we don't want to get too much ahead of ourselves giving you first quarter data. But just to let you know, those are metrics, of course, that we track very, very closely and always remain competitive. That's just the DNA of WOW is that we are a competitive provider. We've prided ourselves being a challenger brand, and that means always being able to anticipate and respond to any competitive dynamics.
Dan Day: Thanks and I think you started to get this in the last question that was asked, and maybe I'll ask you just a little more directly. So for the first quarter guidance for subscriber net adds, can you talk about your expectations for greenfield and what the -- maybe just directionally what you're thinking for gross net adds in greenfield and then losses in the legacy markets.
Teresa Elder: Yes. We really haven't broken it down that way. So we have given you the overall number. But of course, greenfield continues to contribute well. But in order to have that kind of a reversal from fourth quarter to first quarter and what we're guiding you for the first quarter, clearly, we are seeing significant improvement in the legacy side of the business as well. So we're lifting the boats on both sides. We've got more homes passed on the greenfield side to go out and attract new customers. So our -- I was just with a group of our top salespeople. They're very excited about the reaction that they're getting there. And feel good about the new markets that we're going into. And on the legacy side, both shoring up churn, getting back down to those levels that WOW has always enjoyed and also attracting new customers with the new pricing options, delighting our existing customers with those speed upgrades. So really, I think, working on all fronts.
Dan Day: Okay, good. Thanks.
Operator: Our next question comes from the line of Matthew Harrigan with Benchmark. Please go ahead.
Matthew Harrigan: Thank you. You have to be very happy with how robust your econometric model is for identifying new market entry given the penetration you're getting on your cohorts. But do you think those markets or some of the characteristics are going to evolve over time, so were they near the more competitive base markets? And have you kind of identified your ROI or modified your ROI and your hurdle rates and maybe be a little bit more cautious moving forward in reaction to that. And when you look at these new markets, I mean Florida et cetera, you some great demographic areas as far as household formation and all that. But how much of your NAV for identifying these great new markets as a function of good demographics and all that versus just the competitive intensity, at least for a while being a little less intense, whether may not be having much fiber or T-Mo or rise not really doing too much on fixed wireless in those areas sorry, you apologize you've been a little bit long winded, but I'm sure you've got the gist of my question. Thank you.
Teresa Elder: Thanks, Matthew. Yes. I think I get the gist of what you're saying. So in the new markets, we do have some competitive dynamics. There's no question about it. But I believe what we are offering with the fiber-to-the-home with attractive pricing. Once again, actually the simplified pricing where we really are bundling together the key components of the service that customers want, so they don't have to do a piecemeal. So really being very transparent in all our pricing. That started in our Greenfield markets as opposed to doing various promotions. And that has worked very well in Greenfield, very, very low churn. And we took some of those key learnings along with additional research when we rolled out what we're doing now in our legacy markets. So we feel very good about the markets that we have selected and the penetration rate growth and not seeing really anything for churn, lots of good word of mouth. So those markets continue to be good. I think the second half of your question was about, okay, as we look at new markets, how does that compare? What kind of criteria do we use? And how does it compare to our original business plan. We still feel like we are beating the original business plan and some of those metrics we put out way back when we did an Investor Day, I believe, in 2021. And we're feeling very good about those criteria that we had in the initial model. The criteria that we have for selecting markets is not just about competition, although that is a very important factor, we also look at the density of homes, the cost to build, the ratio of underground to aerial, the growth of the market itself versus is it a market or a city that is retracting in size, the speed with which we can get launched. We look at so many different criteria. And I think that kind of secret sauce of how we've selected markets has proved very positive. We've announced some other new markets in addition to the ones where we already have homes passed, and we're extremely pleased with the early response from the community and how the builds are going. So, so far, so good, and we feel good about our ability to choose wisely.
Matthew Harrigan: And you clearly feel able to continue to finance the new build given the limited free cash generation right now?
Teresa Elder: Yes. We -- John put out a guide for what we anticipate in terms of CapEx for greenfield this year of $60 million. Last year, we spent a lot as we did a lot of the upfront work in many of these markets, and those kinds of upfront costs really will support hundreds of thousands of homes, not just the ones we've done so far. And John, did you want to add more to that?
John Rego: Yes. So I mean, Matt, it's clearly less CapEx dollars for greenfield than last year. However, a lot of the upfront work, all the setup building of the hub building a warehouse is getting the materials out there. This year is more purely focused on adding homes passed. And that actually requires less money to set up stuff. So we feel pretty comfortable we're going to stay on pace. And we still feel pretty comfortable we'll be on pace that we set actually on the Analyst Day, which was back in 2021. So it's just a matter of where the dollars are spent. But obviously, we're watching everything we'll be careful.
Matthew Harrigan: Thanks, Teresa. Thanks, John.
Operator: Our final question comes from the line of Brandon Nispel with KeyBanc Capital Markets. Please go ahead.
Brandon Nispel: Hey guys, thanks for taking the question. John, I was hoping you could just address the liquidity position. It looks like you drew on the revolver again. To the extent that you do want to go faster, I'm green it sounds like you're slowing down quite a bit, at least from a dollars perspective. But what options do you have to get some more liquidity in the business? And then do you think you'll be free cash flow positive more towards the second-half of the year as CapEx comes down?
John Rego: Yes. So the plan is to be free cash flow positive for the full-year. So we're doing a lot of different things, Brendan, just so when we are literally taking the expansion capital dollars down, and that's purely discretionary, so we can do that. As I just said on Matt's question, we spent a lot of money in 2023, and that was a lot of the setup work. So by spending less money, we can actually just focus on adding homes. So that's 1 thing for sure that we're doing. We kind of blurred it out on the call, but we executed multiple hedges on about $500 million of our debt. So that will save us some cash flow as it relates to interest expense. We also took another hard look at the OpEx of the company, and we also referenced that there on the call. We've done some more cutting on top of the cutting that we talk about all the time to hit the $35 million over the next several years. So we feel we're in a place that we can do that. And the important thing to remember is that the bulk of our spending outside of running the businesses is purely discretionary. So we take a little bit of cutbacks in terms of dollars spent on Greenfields, dollars spent on core CapEx. We've done hedges, and we've kind of rightsized, we believe, some of the OpEx of the company. So we feel fairly comfortable that we'll be back to a cash flow breakeven to somewhat positive by the end of this year. That's the plan.
Brandon Nispel: Thanks.
Operator: I would now like to turn the call over to Teresa Elder for closing remarks.
Teresa Elder: All right. Thank you, and thanks so much for joining us this morning. We appreciate your continued interest and support of WOW. Have a great day.
Operator: This concludes today's call. You may now disconnect.
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