GLIBK · GCI Liberty, Inc.

GCI Liberty's first quarter 2026 results reflect ongoing operational headwinds. Total revenue declined 4% year-over-year to $256 million, driven by a 5% drop in consumer revenue (due to the full exit of the video business in 2025) and a 3% decline in business revenue (impacted by lower data revenue and a $4 million prior-year benefit from a healthcare rate appeal). Operating income fell 48% to $30 million, and Adjusted OIBDA decreased 18% to $93 million. The earnings release attributes the decline to $13 million of non-comparable items, including a $4 million benefit in Q1 2025 from the Quintillion fiber break restoration and a $2 million net benefit from the healthcare rate appeal. Additionally, operating expenses rose 6% due to higher professional service fees ($4 million for efficiency initiatives), and SG&A grew 11% from $3 million in new public company costs. Stock-based compensation surged 300% to $8 million due to grant timing changes. Consumer gross margin improved 200 bps to 72.2% as direct costs fell 11% from lower video programming costs. Business gross margin contracted 480 bps to 77.3% due to higher distribution costs from restored Quintillion network service. On a trailing twelve-month basis, operating cash flow was $329 million and free cash flow was $99 million. Capital expenditures for Q1 were $55 million, with full-year 2026 capex guided to $290 million, including $20 million carryover from 2025, primarily for hybrid fiber-coaxial network improvements. Management commentary highlighted the planned acquisition of Quintillion for $310 million cash plus potential earn-outs, expected to be accretive to free cash flow and enhance network resiliency. The company also completed a $107 million investment in Liberty Latin America for an approximate 6% equity stake and is in discussions to acquire Dr. John Malone's LLA interests in exchange for newly issued Series C shares. GCI Liberty will rename to Liberty Capital Corporation, with tickers unchanged. These strategic moves signal a shift toward growth through capital deployment, though near-term earnings face pressure from elevated costs and investment spending.