ENGLEWOOD, Colo.--(BUSINESS WIRE)--May 07, 2026--
GCI Liberty, Inc. ("GCI Liberty") (Nasdaq: GLIBA, GLIBK) today reported first quarter 2026 results.
Headlines include(1) :
-- GCI Liberty(2) revenue declined 4% to $256 million, operating income
was $30 million and Adjusted OIBDA(3) declined 18% to $93 million,
inclusive of $13 million of items that are not comparable to the prior
year period
-- GCI Liberty generated net cash provided by operating activities of $329
million and free cash flow(3) of $99 million over the trailing twelve
months ended March 31, 2026
-- Total wireless lines in service increased 2% to 207,700
-- Consumer cable modem subscribers declined 3% to 150,500
-- GCI entered into a definitive agreement to acquire Quintillion, a fiber
infrastructure provider in Alaska that will enable GCI to create a ringed
subsea and terrestrial fiber network across Alaska with improved network
resiliency and reliability
-- GCI Liberty completed the acquisition of an approximate 6% equity
interest in Liberty Latin America ("LLA") from Searchlight Capital
Partners for an aggregate cash purchase price of $107 million and is
currently in discussions with Dr. John C. Malone, Chairman of the Board
and Director Emeritus of LLA, with respect to the potential acquisition
of his equity interests in LLA, including certain high vote shares, in
exchange for newly issued GCI Liberty Series C shares
-- GCI Liberty to change its name to Liberty Capital Corporation ("Liberty
Capital")
"GCI had another solid quarter, reflecting our continued commitment to providing the highest quality connectivity to our customers. We also announced GCI's planned acquisition of Quintillion, bringing together two complementary networks that will increase the quality of Alaska's communications infrastructure. The transaction is expected to be accretive to free-cash-flow and advances our long-term strategy to invest in critical network assets to enhance connectivity for all Alaskans," said GCI Liberty CEO, Ron Duncan. "Additionally, GCI Liberty's opportunistic investment in Liberty Latin America is the first step in executing our growth strategy as Liberty Capital. We remain focused on operating excellence while also creating long-term shareholder value through strategic capital deployment."
Business Updates
On April 21, 2026, GCI entered into a definitive agreement under which GCI will acquire 100% of the equity in Q Gateway Intermediate Holdings, LLC ("Quintillion"), a fiber infrastructure provider in Alaska, in exchange for consideration of $310 million in cash subject to certain adjustments, reimbursement of up to $50 million for certain capital expenditures incurred by Quintillion and potential earn-out payments in 2028, 2029 and 2031. Closing is anticipated following the receipt of regulatory approval and satisfaction of customary closing conditions. Existing customer relationships, contractual obligations and service arrangements are expected to continue without change following the close of the transaction. The transaction is expected to bring together complementary subsea and terrestrial fiber networks to enhance the scale, resiliency and reach of GCI's statewide network. The transaction is expected to provide cost efficiencies and to be accretive to free cash flow. Additional information regarding the proposed acquisition can be found in the 8-K filed by GCI Liberty with the Securities and Exchange Commission ("SEC").
On April 16, 2026, GCI Liberty completed the purchase of approximately 61,000 Class A common shares and 12.3 million Class C common shares of LLA for $107 million in cash from Searchlight Capital. GCI Liberty is also currently in good faith discussions with Dr. Malone with respect to GCI Liberty's potential acquisition of his equity interests in LLA, including certain high-vote shares, in exchange for newly issued Series C common stock of GCI Liberty.
GCI Liberty is renaming the public parent company to Liberty Capital Corporation. No changes will be made to the tickers as a result of the name change and its Alaska subsidiary will continue to operate under the GCI name and brand.
Discussion of Results
The following table provides the financial results of GCI Liberty for the first quarter of 2025 and 2026.
(amounts in millions) 1Q25 1Q26 % Change
---- ---- ------------
Consolidated Financial
Metrics
Revenue
Consumer $ 121 $ 115 (5) %
Business 145 141 (3) %
---- ----
Total revenue $ 266 $ 256 (4) %
==== ====
Operating expenses
(exclusive of depreciation
and amortization):
Consumer direct costs $ (36) $ (32) 11 %
Business direct costs (26) (32) (23) %
Technology expense (63) (68) (8) %
---- ----
Total operating
expenses (exclusive
of depreciation and
amortization) $(125) $(132) (6) %
==== ====
Selling, general and
administrative expense
(exclusive of
stock-based
compensation) $ (28) $ (31) (11) %
Stock-based compensation $ (2) $ (8) (300) %
Depreciation and
amortization $ (53) $ (52) 2 %
Acquisition costs $ - (3) (100) %
Operating income (loss) $ 58 $ 30 (48) %
Operating income margin
(%) 21.8% 11.7% (1,010) bps
Adjusted OIBDA(a) $ 113 $ 93 (18) %
Adjusted OIBDA margin(a)
(%) 42.5% 36.3% (620) bps
Capital expenditures, net
of grant proceeds $ (49) $ (55) (12) %
____________________
(a) See reconciling schedule 1.
GCI revenue decreased 4% in the first quarter of 2026. Consumer revenue decreased 5%, driven primarily by fully exiting the video business in 2025. Business revenue declined 3%, driven by a decline in data revenue.
Operating income decreased $28 million and Adjusted OIBDA decreased $20 million in the first quarter driven primarily by $13 million of items impacting year-over-year comparability as well as increased operating expenses. During the first quarter of 2025, GCI recognized a $4 million benefit from the successful appeal of rates for services provided to certain healthcare customers in prior years. The first quarter of 2025 also had a $2 million net benefit related to a fiber break on the Quintillion network in which GCI uses capacity that has since been restored. During the first quarter of 2026, operating expenses also increased primarily due to increased professional service fees driven by $4 million of incremental professional fees related to driving efficiencies. Selling, general and administrative expenses grew primarily due to $3 million of public company costs which were not in the cost base in the prior year quarter but will continue to be part of ongoing expenses. The decline in operating income was also impacted by higher stock-based compensation expense due to a delay in grants until the spin-off from Liberty Broadband Corporation was completed combined with a change in grant timing for GCI employees.
Year to date, GCI has spent $55 million, net of grant proceeds, on capital expenditures related primarily to improvements to the wireless and data networks in rural Alaska. GCI's net capital expenditures for the full year 2026 are expected to be $290 million, including $20 million carried over from 2025 due to normal course timing shifts. A significant portion of the increased capital expenditures in 2026 are related to hybrid fiber-coaxial network improvements.
On a trailing twelve-month basis through the first quarter of 2026, net cash provided by operating activities totaled $329 million and free cash flow over the same period was $99 million.
GCI Consumer
(amounts in millions,
except operating
metrics) 1Q25 1Q26 % Change
------- ------- ----------
GCI Consumer
Financial Metrics
Revenue
Data $ 61 $ 59 (3) %
Wireless 50 52 4 %
Other 10 4 (60) %
------- -------
Total revenue $ 121 $ 115 (5) %
======= =======
Consumer direct costs (36) (32) 11 %
Consumer gross margin $ 85 $ 83 (2) %
======= =======
Consumer gross margin
(%) 70.2% 72.2% 200 bps
Operating Metrics
Data:
Cable modem
subscribers(a) 154,700 150,500 (3) %
Wireless:
Lines in
service(b) 195,500 200,000 2 %
____________________
(a) A cable modem subscriber is defined by the purchase of cable modem
service regardless of the level of service purchased. If one entity
purchases multiple cable modem service access points, each access point
is counted as a subscriber. Small-to-Medium Business customers,
promotional cable modem access points and customers that have been
inactive for 60 days or less are included.
(b) A consumer wireless line in service is defined as a wireless device with
a monthly fee for services. Consumer wireless lines include
Small-to-Medium Business customers, promotional lines, postpaid lines
that have been inactive for 60 days or less and paying prepaid lines.
GCI Consumer revenue totaled $115 million in the first quarter of 2026, a 5% decrease compared to the prior year period. The decrease was driven primarily by fully exiting the video business in 2025, partially offset by growth in wireless revenue.
Data revenue totaled $59 million, a 3% decrease, driven primarily by subscriber losses. Consumer cable modem subscribers declined 3% year-over-year bringing total consumer cable modem customers to 150,500. During the first quarter of 2026, GCI lost 700 consumer cable modem subscribers.
Wireless revenue totaled $52 million, a 4% increase, driven by an increase in wireless lines in service. Consumer wireless lines grew 2% year-over-year, bringing total consumer wireless lines to 200,000. During the first quarter of 2026, GCI added 1,000 consumer wireless lines.
GCI Consumer gross margin was 72.2% in the first quarter of 2026, a 200 bps increase from the same quarter last year. GCI Consumer direct costs decreased 11%, driven by lower video programming costs from the exit of video services during the third quarter of 2025.
GCI Business
(amounts in millions,
except operating metrics) 1Q25 1Q26 % Change
----- ----- ----------
GCI Business
Financial Metrics
Revenue
Data $ 128 $ 124 (3) %
Wireless 10 10 -- %
Other 7 7 -- %
----- -----
Total revenue $ 145 $ 141 (3) %
===== =====
Business direct costs (26) (32) (23) %
Business gross margin $ 119 $ 109 (8) %
===== =====
Business gross margin (%) 82.1% 77.3% (480) bps
Operating Metrics
Wireless:
Lines in service(a) 8,700 7,700 (11) %
____________________
(a) A business wireless line in service is defined as a wireless device with
a monthly fee for services. Business wireless lines include enterprise
customers, promotional lines and postpaid lines that have been inactive
for 60 days or less.
GCI Business revenue totaled $141 million in the first quarter of 2026, a 3% decrease compared to the prior year period. The first quarter of 2025 benefitted from approximately $4 million of revenue relating to the successful appeal of rates for services provided to certain healthcare customers in prior years.
GCI Business gross margin was 77.3% in the first quarter of 2026, a 480 bps decrease from the same quarter last year. GCI Business direct costs increased 23% in the first quarter of 2026, driven primarily by higher distribution costs related to restored service on the Quintillion network in which GCI uses capacity. The network was out of service during the first quarter of 2025.
FOOTNOTES
1) Unless otherwise noted, highlights compare financial information for the
three months ended March 31, 2026 to the same period in 2025. GCI Liberty
will discuss these highlights and other matters on GCI Liberty's earnings
conference call that will begin at 11:15 a.m. (E.T.) on May 7, 2026. For
information regarding how to access the call, please see "Important
Notice" later in this document.
2) GCI Liberty's principal operating asset is GCI Holdings ("GCI"), which
provides data, mobile, voice and managed services to consumer, business,
government and carrier customers throughout Alaska.
3) For a definition of Adjusted OIBDA, Adjusted OIBDA margin and free cash
flow and applicable non-GAAP reconciliations, see the accompanying
schedule 1.
NOTES
Cash and Debt
The following presentation is provided to separately identify cash, cash equivalents, restricted cash and debt of GCI Liberty as of December 31, 2025 and March 31, 2026.
(amounts in millions) 12/31/2025 3/31/2026
------------ -----------
Cash, Cash Equivalents and Restricted
Cash: $ 429 $ 448
Debt:
Senior Notes(a) $ 600 $ 600
Senior Credit Facility 367 366
Tower Obligations and Other(b) 76 69
-------- -------
Total Debt $ 1,043 $ 1,035
-------- -------
GCI Leverage(c) 2.3x 2.3x
GCI Liberty Leverage(d) 1.6x 1.6x
Unamortized premium and deferred loan
costs 12 11
Tower obligations and finance leases
(excluded from GAAP Debt) (72) (65)
-------- -------
Total Debt (GAAP) $ 983 $ 981
-------- -------
Other Financial Obligations:
-------- -------
Preferred Stock(e) $ 10 $ 10
-------- -------
____________________
(a) Principal amount of Senior Notes.
(b) Includes the current and long-term obligations under tower obligations
and other.
(c) As defined in GCI's credit agreement.
(d) Defined as GCI Liberty net debt including preferred stock and
consolidated cash and cash equivalents, excluding restricted cash
divided by GCI Liberty Adjusted OIBDA. Restricted cash was $13 million
as of December 31, 2025 and March 31, 2026.
(e) $10 million of non-voting preferred stock of GCI Liberty was issued to
Liberty Broadband in the third quarter of 2025 and then sold by Liberty
Broadband to third party buyers. The preferred stock has a 12% dividend
rate and $1,000 per share liquidation price plus accrued and unpaid
dividends. The mandatory redemption date is July 14, 2032.
GCI Liberty cash, cash equivalents and restricted cash increased $19 million in the first quarter of 2026 primarily due to cash from operations, partially offset by capital expenditures, net of grant proceeds.
GCI Liberty debt was relatively flat in the first quarter of 2026.
As of March 31, 2026, GCI's credit facility had undrawn capacity of $377 million (net of letters of credit), and GCI's leverage as defined in its credit agreement was 2.3x. Subsequent to the end of the first quarter, GCI will provide a $160 million unsecured loan to Quintillion per the terms set forth in the purchase agreement.
Important Notice: GCI Liberty (Nasdaq: GLIBA, GLIBK) will discuss GCI Liberty's earnings release on a conference call which will begin at 11:15 a.m. (E.T.) on May 7, 2026. The call can be accessed by dialing +1 (877) 407-3944 or +1 (412) 902-0038, passcode 13756845, at least 10 minutes prior to the start time. The call will also be broadcast live across the Internet and archived on our website. To access the webcast, go to https://www.gciliberty.com/investors/news-events/ir-calendar. Links to this press release and replays of the call will also be available on GCI Liberty's website.
This press release includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including certain statements relating to business strategies, GCI's planned acquisition of Quintillion and GCI Liberty's potential acquisition of additional equity interests in LLA. All statements other than statements of historical fact are "forward-looking statements" for purposes of federal and state securities laws. These forward-looking statements generally can be identified by phrases such as "possible," "potential," "intends" or "expects" or other words or phrases of similar import or future or conditional verbs such as "will," "may," "might," "should," "would," or "could," or similar variations. These forward-looking statements involve many risks and uncertainties that could cause actual results and the timing of events to differ materially from those expressed or implied by such statements, including, without limitation, competitive issues, customer demand, economic conditions (including inflationary pressures), regulatory and legislative matters affecting GCI Liberty's businesses, the completion of GCI Liberty's acquisition of Quintillion, and GCI Liberty's ability to execute its growth strategy. These forward-looking statements speak only as of the date of this press release, and GCI Liberty expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in GCI Liberty's expectations with regard thereto or any change of events, conditions or circumstances on which any such statement is based. Please refer to the publicly filed documents of GCI Liberty, including the risk factors detailed in its most recent Form 10-K, as such risk factors may be amended, supplemented or superseded from time to time by other reports GCI Liberty subsequently files with the SEC, for additional information about GCI Liberty and the risks and uncertainties related to GCI Liberty's business that may affect the statements made in this press release.
NON-GAAP FINANCIAL MEASURES
SCHEDULE 1
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