Altice USA might not be a Wall Street darling like Netflix or Tesla, but a close look at their Q1 2024 earnings call transcript reveals a potential turnaround story brewing. Altice is employing a "whisper strategy," making subtle but significant improvements amidst the industry's focus on fiber overbuilds and aggressive mobile promotions.

Altice is quietly shifting its focus from simply expanding its fiber network to prioritizing fiber migration. In Q1 2024, 70% of their fiber net adds came from migrating existing customers, a significant increase from previous quarters. This suggests a growing confidence in their fiber product's ability to attract their existing customer base.

Furthermore, Altice is leveraging its mobile business to reduce churn. They've reported a 20% annualized churn reduction for customers who bundle broadband with mobile. With a current mobile penetration of just 5.3% of their broadband base, the potential for further churn reduction is substantial.

"The Hypothesis: Altice is aiming to build a loyal, high-ARPU customer base by combining their award-winning fiber network with an increasingly attractive mobile offering. They're seeing a $4.30 year-over-year increase in mobile ARPU, indicating a shift towards higher-value unlimited plans."

Despite a challenging economic environment and fierce competition, Altice reported year-over-year Residential ARPU growth for the second consecutive quarter, reaching $135, driven by stable churn and mobile growth.

Fiber Net Adds: Migrations vs. New Customers

The chart below illustrates the shift in Altice's fiber net adds, highlighting the increasing proportion of customer migrations.

This whisper strategy is a departure from the industry's current playbook of prioritizing subscriber growth at any cost. Altice is focusing on profitability by streamlining operations, strategically deploying capital, and leveraging AI to optimize customer interactions.

Will this quiet giant wake up Wall Street? Only time will tell. But Altice's focus on quality, value, and customer loyalty could pave the way for a more sustainable and profitable growth trajectory.

"Fun Fact: Altice USA operates in some of the most densely populated and competitive markets in the US. Optimum, their primary brand in the Northeast, serves over 4.9 million customers."