Crown Castle Inc. beats Q3 revenue expectations, increases dividend

Houston-based telecommunications infrastructure company Crown Castle Inc. (NYSE: CCI) met analysts' expectations for earnings per share and beat expectations for revenue for the third quarter.

Crown Castle reported Q3 net revenue of nearly $1.75 billion on Oct. 19, beating analysts' expectations of $1.73 billion, according to Yahoo Finance. The company reported net income of $419 million, or 97 cents per share, which met expectations.

The Q3 net revenue increased 7.9% from nearly $1.62 billion in the third quarter of 2021 and less than 1% from more than $1.73 billion in Q2 2022. Net income jumped more than 19% year over year from $351 million in Q3 2021 but decreased less than 1% quarter over quarter from $421 million in Q2 2022.

Additionally, Crown Castle’s board of directors increased its quarterly cash dividend to $1.565 per common share, up 6.5% from the previous quarter. The latest dividend will be payable on Dec. 30 to common stockholders of record as of close of business Dec. 15.

“The dividend increase is supported by the expected growth in cash flows in 2023 and reflects our confidence in the strength of our business model despite the challenging global macroeconomic environment,” CEO Jay Brown said.

Crown Castle has seen 6.5% organic revenue growth in its tower segment year to date as the company continues to deploy 5G at scale, CFO Dan Schlanger said. The company expects another 5% of organic revenue growth in the tower sector in 2023 as its customers continue to upgrade their macro tower networks, Brown said.

“I believe we remain in the early stages of 5G development in the U.S., providing a long runway of growth in demand for our comprehensive communications infrastructure offering across towers, small cells and fiber,” Brown said.

Schlanger said the company expects to see an increase in its expected 2023 interest expense due to rising interest rates, which may cause headwinds to expected growth. However, he said much of that should be offset by expected acceleration of future billings from previously announced Sprint network decommissioning work.

Crown Castle owns, operates and leases more than 40,000 cell towers and approximately 85,000 route miles of fiber across every major U.S. market. The company, which officially changed its name from Crown Castle International Corp. Aug. 1, is No. 28 on the Houston Business Journal's 2022 Largest Houston-Area Public Companies List, based on its 2021 revenue of $6.34 billion.