Business revenue a bright spot in Frontier’s Q2 results

As Frontier Communications continues its path to revitalize revenue growth, its business and wholesale unit was the star of the show for Q2, boasting positive year-on-year revenue growth for the first time in six years.

Business and wholesale revenue of $653 million rose 0.3% from Q2 2022. Fiber revenue made up $284 million of that amount and jumped nearly 8% year-on-year.

Speaking on an earnings call, Frontier CEO Nick Jeffery stated the business and wholesale growth was “profound against the backdrop of our telecom peers, who continue to report mid to high single-digit revenue declines in this segment.”

Altice USA for instance posted revenue declines across the board for Q2, including in its Business Services segment.

Jeffery went on to say Frontier’s business segments “don’t really reflect market dynamics” as the company is a small player in the enterprise market. Frontier’s business and wholesale growth is specifically focused on small and midsize businesses (SMBs).

“Those customers have a much higher propensity to buy the kinds of fiber-based internet access products that we’re really good at providing and delivering with real quality,” he said. “So I think we’ve got a natural affinity towards a smaller segment.”

While business and wholesale revenue was up, consumer revenue of $775 million dipped 2% year-on-year. However, consumer fiber revenue of $462 million rose nearly 10% since the year-ago quarter.

Fiber gains, securitization

Frontier in Q2 reached 316,000 new fiber passings as well as added 66,000 fiber broadband customers, ending the period with 1.72 million fiber subscribers – a 19% year on year increase.

But fiber gains were offset by 64,000 copper customer losses, resulting in just 2,000 overall broadband customer net additions.

Frontier executives provided some color on the company’s recent fiber securitization offering, which was initially priced at $1.05 billion but was upgraded to $2.1 billion.

CFO Scott Beasley explained the offering securitized approximately 600,000 fiber locations in Frontier’s Dallas market. Further, the transaction raises Frontier’s debt to roughly $3,400 per passing, highlighting “the value of mature fiber assets.”

Jeffery added the fiber securitization opens up “a range of new possibilities for us as a great, efficient source of capital funding going forward.”

A note on lead-sheathed cables

As other telco execs have done, Frontier’s CEO addressed the Wall Street Journal’s investigative report that found at least 2,000 old cables with degraded lead.

Jeffery stated the company has “no reason to believe” the lead in Frontier’s cables poses a health or environmental risk. Frontier’s preliminary internal evaluation estimates lead-sheathed cables represent a “single-digit percentage” of its roughly 685,000-mile copper footprint.

Jeffery did not elaborate further on the company’s lead cable findings.


Consolidated revenue of $1.45 billion slid 0.7% year on year, as growth in fiber was offset by declines in copper customers. The company reported a net loss of $2 million, while adjusted EBITDA was $533 million.

Capital expenditures increased from $0.64 billion in Q2 2022 to $1.06 billion, mainly due to accelerated fiber expansion. Frontier also doubled its year-end cost savings target to $500 million.