Crown Castle raises AFFO forecast after $8.4B fiber sale closes

Crown Castle raised its 2026 AFFO forecast by $5 million after completing the $8.4 billion sale of its fiber and small cell businesses, becoming the only publicly traded pure-play U.S. tower operator.

"We delivered solid second quarter results and continue to execute against our best-in-class U.S. tower strategy," Chief Executive Officer Christian Hillabrant said.

Second-quarter organic growth, excluding Sprint cancellations and DISH terminations, was 3.9%, or $38 million. The company completed $1 billion in share repurchases at an average price of $88.66, retiring more than 11 million shares, and repaid more than $7 billion in debt using proceeds from the transaction.

The company now expects 2026 to mark the low point for organic growth, citing upcoming spectrum auctions, mobile data demand and edge computing opportunities. Crown Castle is pursuing a $3.5 billion contractual claim in Dish's bankruptcy, with a $2.4 billion escrow account set up for network-related obligations.

Full-year organic growth, excluding Sprint and DISH impacts, is now expected at 3.4%, up from a prior forecast of 3.3%. The company maintained its leasing guidance at $60 million to $70 million and said more than 90% of its full-year organic growth was already contracted, compared with about 80% at the start of the year.

Hillabrant pointed to AT&T's planned deployment of 600 MHz spectrum, expected to close this month, as a near-term catalyst for tower demand. Crown Castle ended the quarter with leverage at 6.3 times net debt to EBITDA, within its target investment-grade range of 6 to 6.5 times. The company reduced its revolving credit facility capacity to $4.5 billion from $7 billion to align with its stand-alone tower business.

The company identified $15 million in cost savings, including $10 million from lower site rental costs and $5 million from reduced selling, general and administrative expenses. Management said it expects to expand EBITDA margins by a couple of hundred basis points over the next year through ground lease buyouts and operational improvements.

The guidance raise shows management expects demand to accelerate as carriers deploy new spectrum and edge computing infrastructure. Investors will watch the third-quarter earnings call for updates on the Dish bankruptcy proceedings and progress on edge computing trials.

This article is for informational purposes only and does not constitute investment advice.