SBA COMMUNICATIONS CORPORATION
2024 ANNUAL REPORT
YOUR
SIGNAL
STARTS
HERE.
®
LEADER IN THE WIRELESS
COMMUNICATIONS
INFRASTRUCTURE INDUSTRY
ESSENTIAL
INFRASTRUCTURE
®
SBA COMMUNICATIONS
3
SBA Communications | sbasite.com | 2024 Annual Report
SBA Communications | sbasite.com | 2024 Annual Report
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SBA Communications | sbasite.com | 2024 Annual Report
3,000m
2,500m
2,000m
1,500m
1,000m
500m
Financial
Highlights
Site leasing revenue for the year 2024 was $2,527 million compared to $2,517 million
for the year 2023; an increase of 0.4%.
SITE LEASING REVENUES IN MILLIONS ($)
SITE LEASING OPERATING PROFIT IN MILLIONS ($)
2022
2024
2018
2019
2020
2021
2023
2022
2024
2018
2019
2020
2021
2023
$1,891m
$1,368m
$1,487m
$1,581m
$1,718m
$2,044m
$2,337m
$2,527m
$1,740m
$1,861m
$1,954m
$2,104m
$2,517m
$2,064m
3,000m
2,500m
2,000m
1,500m
1,000m
500m
Site leasing segment operating profit for the year 2024 was $2,064 million
compared to $2,044 million for the year 2023; an increase of 1.0%.
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SBA Communications | sbasite.com | 2024 Annual Report
In thousands (except per share data)
for year ended December 31,
2023
2024
%
change
REVENUES
Site Leasing
$2,516,935
$2,526,765
0.4%
Site Development
$194,649
$152,869
(21.5%)
Total Revenues
$2,711,584
$2,679,634
(1.2%)
COST OF REVENUES
Site Leasing
$472,687
$462,997
(2.0%)
Site Development
$139,935
$118,730
(15.2%)
Total Cost of Revenues
$612,622
$581,727
(5.0%)
OPERATING PROFIT
Site Leasing
$2,044,248
$2,063,768
1.0%
Site Development
$54,714
$34,139
(37.6%)
Total Operating Profit
$2,098,962
$2,097,907
(0.1%)
Selling, general & administrative expenses
$267,936
$258,756
Net income attributable to
SBA Communications Corporation
$501,812
$749,536
Basic net income per share
$4.64
$6.96
Diluted net income per share
$4.61
$6.94
Weighted average number of shares (basic)
108,204
107,644
Weighted average number of shares (diluted)
108,907
108,080
As of December 31, cash, cash equivalents,
short-term investments and short-term
restricted cash
$247,722
$1,651,028
Total assets
$10,178,441
$11,417,336
Total principal amount of indebtedness
$12,388,000
$13,672,750
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SBA Communications | sbasite.com | 2024 Annual Report
TO OUR
SHAREHOLDERS
2024 was another solid year for SBA Communications.
Our towers continued to be the center of the wireless
ecosystem, providing critical infrastructure and a turnkey
option for our customers to quickly and efficiently achieve
their network needs. I was pleased with our performance
as both operating and financial results were in line
with our initial expectations. We finished the year with
industry-leading Tower Cash Flow and Adjusted EBITDA
margins of 81.3% and 71.0%, respectively, and posted
the highest absolute AFFO per share of $13.37 within
the industry. We grew our dividend by 15%, the highest
not only in the tower industry, but among the highest across all REITs broadly.
We also took steps to improve our balance sheet, refinancing over $4 billion of
debt at attractive rates, hedging floating rate debt to minimize fluctuations in
interest expense, and improving liquidity by increasing the size of our revolving
credit facility to $2 billion. And lastly, we allocated capital wisely, buying towers
and land, building sites, repurchasing our stock and ending the year with a
healthy cash reserve.
In the United States, our customers remained focused on their networks, and
we began to see a shift in our new business with a higher percentage coming
from new lease colocations versus amendments to existing leases. This shift
was a continuation of our carrier customers’ goals to expand their 5G mid-
band coverage, add capacity for fixed wireless access, and extend network
coverage into underserved areas of the country. New carrier activity steadily
increased throughout the year, and we exited 2024 at the highest level of
leasing application backlogs of the year, setting us up well for 2025. We’re
excited about the potential leasing environment in 2025 and beyond, which we
anticipate being busier than that of the last several years. Our strong customer
relationships and the end-to-end support we are able to provide them through
both our leasing and services operations set SBA up very well to be a key
Our towers
continued to
be the center
of the wireless
ecosystem,
providing critical
infrastructure
and a turnkey
option for our
customers to
quickly and
efficiently
achieve their
network needs.
“
7
SBA Communications | sbasite.com | 2024 Annual Report
partner to the mobile network operators. Regulatory requirements, mobile
data growth consumption and growing dependence on wireless services all
give me great confidence that our domestic segment
will experience solid long-term organic growth and
perform very well over time.
Internationally, our customers continued investing
in their networks but also focused on addressing
the implications of recent strategic transactions.
In almost all our international markets, the mobile
network operators are well behind the U.S. in terms
of 5G coverage, so we anticipate continued network
investment to close that gap and to broadly expand
coverage. During 2024, we did experience slightly elevated lease churn, primarily
as a result of some carrier consolidation. However, we believe this will be
temporary as markets rationalize, and ultimately, we expect that the surviving
customers will be stronger and better positioned for ongoing investments needed
to compete on network reliability. One of our priorities has been to enhance our
international portfolio with the goals of increasing the predictability and stability
of our long-term cash flows, growing the core business and improving the overall
quality of our assets.
We believe one of the
primary ways that we
do that is by positioning
ourselves as one of the
leading
infrastructure
providers in the markets
where we operate and
aligning ourselves with
the
leading
mobile
network operators in
each market. We made
significant progress in this regard through our announced agreement to purchase
approximately 7,000 towers from Millicom in Central America. This transaction
is expected to establish SBA as the leading tower company in the region, as well
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SBA Communications | sbasite.com | 2024 Annual Report
as improve the overall quality and stability of our cash flows through immediate
AFFO accretion, U.S. dollar denominated revenue streams, and long-term
tenant lease commitments. We also extended existing lease agreements with
Millicom and entered into a new build to suit agreement for a
minimum of 2,500 sites over the next seven years, locking
in future value enhancing growth. In other markets, where
we did not see an opportunity to achieve scale, we took
steps to exit. These efforts have led to the early 2025
sales of our assets and operations in both the Philippines
and Colombia. Each of the steps taken over the past
year will help our teams be better focused and better
positioned to maximize future business opportunities,
and we anticipate making more progress in 2025.
Looking at 2025 and beyond, the key growth drivers of our business remain
robust. Mobile network consumption continues to grow, and spectrum
limitations mean more equipment at the cell site. 5G applications have
emerged, such as Fixed Wireless Access and next-gen A.I. handset
applications. The underlying industry tailwinds, paired with the strength of
our balance sheet and significant free cash flow, give me great confidence in
the future. In aggregate, we believe that these efforts will allow us to continue
to produce strong financial and operating results and invest in high quality
new assets, as well as healthy shareholder remuneration through dividend
growth and share repurchases.
While macroeconomic factors such as elevated interest rates and weakened
foreign currencies have weighed on the valuations of the entire wireless
infrastructure sector, I believe the steps we are taking will position us to produce
meaningful shareholder return opportunities consistently over the long-term.
I’d like to thank our customers for their trust and collaboration, as well as our
best-in-class team members who make SBA such an exceptional company.
And finally, thank you to our shareholders for your trust and support, and I look
forward to sharing our progress with you in the future.
Sincerely,
Brendan T. Cavanagh
President and Chief Executive Officer
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SBA Communications | sbasite.com | 2024 Annual Report
Brendan T. Cavanagh
Director, President and
Chief Executive Officer
Jeffrey A. Stoops
Chairman of the Board
Kevin L. Beebe
Director
Steven E. Bernstein
Founder and Director
Mary S. Chan
Director
Laurie Bowen
Director
George R. Krouse Jr.
Director
Jay L. Johnson
Director
Amy E. Wilson
Director
Jack Langer
Lead Independant Director
BOARD OF DIRECTORS
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SBA Communications | sbasite.com | 2024 Annual Report
2024 FINANCIAL
INFORMATION
FORM 10-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2024
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ___________
Commission file number: 001-16853
SBA COMMUNICATIONS CORPORATION
(Exact name of Registrant as specified in its charter)
Florida
65-0716501
(State or other jurisdiction of
(I.R.S. Employer
incorporation or organization)
Identification No.)
8051 Congress Avenue
Boca Raton, Florida
33487
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code (561) 995-7670
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
Trading Symbol
Name of Each Exchange on Which Registered
Class A Common Stock, $0.01 par value per share
SBAC
The NASDAQ Stock Market LLC
(NASDAQ Global Select
Market)
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes No
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes No
Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an
emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth
company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer
Accelerated Filer
Non-Accelerated Filer
Smaller Reporting Company
Emerging Growth Company
If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or
revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control
over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued
its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the
filing reflect the correction of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received
by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes No
The aggregate market value of the voting stock held by non-affiliates of the Registrant was approximately $21.0 billion as of June 30, 2024.
The number of shares outstanding of the Registrant’s common stock (as of February 14, 2025): Class A common stock — 107,615,241.
Documents Incorporated By Reference
Portions of the Registrant’s definitive proxy statement for its 2025 annual meeting of shareholders, which proxy statement will be filed no later than 120
days after the close of the Registrant’s fiscal year ended December 31, 2024, are hereby incorporated by reference in Part III of this Annual Report on Form
10-K.
Table of Contents
Page
PART I
ITEM 1.
BUSINESS
1
ITEM 1A.
RISK FACTORS
7
ITEM 1B.
UNRESOLVED STAFF COMMENTS
21
ITEM 1C.
CYBERSECURITY
21
ITEM 2.
PROPERTIES
23
ITEM 3.
LEGAL PROCEEDINGS
23
ITEM 4.
MINE SAFETY DISCLOSURE
23
PART II
ITEM 5.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS
AND ISSUER PURCHASES OF EQUITY SECURITIES
23
ITEM 6.
RESERVED
24
ITEM 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
24
ITEM 7A.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
42
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
45
ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
45
ITEM 9A.
CONTROLS AND PROCEDURES
45
ITEM 9B.
OTHER INFORMATION
47
ITEM 9C.
DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
47
PART III
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
47
ITEM 11.
EXECUTIVE COMPENSATION
47
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
47
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
48
ITEM 14.
PRINCIPAL ACCOUNTING FEES AND SERVICES
48
PART IV
ITEM 15.
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
48
ITEM 16.
FORM 10-K SUMMARY
53
SIGNATURES
54
1
ITEM 1. BUSINESS
General
We are a leading independent owner and operator of wireless communications infrastructure, including tower structures,
rooftops, and other structures that support antennas used for wireless communications, which we collectively refer to as “towers” or
“sites.” Our principal operations are in the United States and its territories. In addition, we own and operate towers in South America,
Central America, Canada, and Africa. On January 10, 2025, we sold all our towers and ended our operations in the Philippines and on
February 20, 2025, we entered into an agreement to sell all of our towers and related assets held in Colombia. Our primary business
line is our site leasing business, which contributed 98.4% of our total segment operating profit for the year ended December 31, 2024.
In our site leasing business, we (1) lease space to wireless service providers and other customers on assets that we own or operate and
(2) manage rooftop and tower sites for property owners under various contractual arrangements. As of December 31, 2024, we owned
39,749 towers, a substantial portion of which have been built by us or built by other tower owners or operators who, like us, have built
such towers to lease space to multiple wireless service providers. Our other business line is our site development business, through
which we assist wireless service providers in developing and maintaining their own wireless service networks.
Business Strategy
Our primary strategy is to continue to focus on expanding our site leasing business through organic growth and expansion of
our tower portfolio to create shareholder value. We believe that the long-term and repetitive nature of our site leasing business will
permit us to maintain a stable, recurring cash flow stream and reduce our exposure to cyclical changes in customer spending which
arises in our site development business. We believe that our tower operations are highly scalable. Consequently, we believe that we
are able to materially increase our domestic and international tower portfolio without proportionately increasing selling, general, and
administrative expenses. Key elements of our strategy include:
Organic Growth.
Maximizing our Tower Capacity. We generally have constructed or acquired towers that accommodate multiple tenants and
a majority of our towers are high capacity tower structures. Most of our towers have significant capacity available for
additional antennas, and we believe that increased use of our towers’ structural capacity can generate additional lease
revenue and be achieved at a low incremental cost. We measure the available capacity of our existing sites to support
additional tenants by assessing several factors, including tower height, tower type, wind loading, environmental conditions,
existing equipment on the tower and zoning and permitting regulations in effect in the jurisdiction where the tower is
located. We actively market space on our towers through our internal sales force. As of December 31, 2024, we had an
average of 1.9 tenants per site.
Capitalizing on our Scale and Management Experience. We are a large owner, operator and developer of towers, with
substantial capital, human, and operating resources. We have been developing towers for wireless service providers in the
U.S. since 1989 and have owned and operated towers for ourselves since 1997. We believe our size, experience,
capabilities, and resources make us a preferred partner for wireless service providers both in the U.S. and internationally.
Our management team has extensive experience in site leasing and site development, with some of the longest tenures in
the tower and site development industries. We believe that our industry expertise and strong relationships with wireless
service providers will permit us to continue to organically grow our site leasing and site development services.
Systematic Tower Portfolio Growth. We intend to continue to grow our tower portfolio, domestically and internationally,
through tower acquisitions and the construction of new tower structures. We believe that one of the best uses of our liquidity,
including cash from operating activities and borrowings, is to acquire and/or build new towers at prices that we believe will be
accretive to our shareholders both in the short and long term and which allow us to maintain our long-term target leverage ratios.
Disciplined Domestic and International Tower Acquisitions. In our tower acquisition program, we pursue towers from third
parties that meet or exceed our internal guidelines regarding current and future potential returns. For each acquisition, we
prepare various analyses that include projections of several different investment return metrics, review of available
capacity, future lease up projections, and a summary of current and future tenant/technology mix. For example, in the third
quarter of 2024 we entered into a purchase agreement with Millicom International Cellular S.A. (“Millicom”) for over
7,000 sites throughout Central America. This transaction supports our desire to secure our position as a leader in our
international markets and align ourselves with the leading carriers in such markets.
Strategic New Builds. We believe strategic new builds can contribute to profitable growth, particularly in our international
markets. In our new build program, we construct tower structures (1) under build-to-suit arrangements or (2) in locations
that are strategically chosen by us. Under build-to-suit arrangements, we build tower structures for wireless service
providers at locations that they have identified. Under these arrangements, we retain ownership of the tower structure and
2
the exclusive right to co-locate additional tenants. When we construct tower structures in locations chosen by us, we utilize
our knowledge of our customers’ network requirements to identify locations where we believe multiple wireless service
providers need, or will need, to locate antennas to meet capacity or service demands. We generally will have at least one
signed tenant lease for each new build tower structure on the day that it is completed and expect that some will have
multiple tenants. As part of the Millicom transaction, we have agreed to a seven-year exclusivity right for us to build up to
2,500 build-to-suit sites in Central America with each site built having an initial lease term of 15 years.
International Market Maximization. We are focused on maximizing our site leasing services and profitability in
international markets that meet our investment criteria and where we believe we have, or have the ability to achieve, scale.
Our investment criteria focuses on the quality and quantity of wireless service providers in a given country as well as the
country’s political and regulatory environments. The majority of our international markets typically have less mature
wireless networks with limited wireline infrastructure and lower wireless data penetration rates than those in the United
States. Accordingly, our tower growth in these markets is primarily driven by (1) wireless service providers seeking to
increase the quality and coverage of their networks, (2) increased consumer mobile data traffic, such as media streaming,
mobile apps and games, web browsing, and email, and (3) incremental spectrum auctions as well as incremental voice and
data network deployments. We continually evaluate how a particular market meets our long-term strategic and financial
objectives and our business generally.
Using our Local Presence to Build Strong Relationships with Major Wireless Service Providers. Given the nature of towers
as location-specific communications facilities, we believe that substantially all of what we do is done best locally. Consequently, we
have broad field organizations across the U.S. and in our international markets that allow us to develop and capitalize on our
experience, expertise, and relationships in each of our local markets which in turn enhances our customer relationships. Due to our
presence in local markets, we believe we are well positioned to proactively grow and defend our site leasing business and to capture
new tower build opportunities in our markets and identify and participate in site development projects across our markets.
Controlling our Underlying Land Positions. We believe that a primary component of a strong site leasing business is the
ability to control the underlying land positions. Consequently, we have acquired perpetual easements, long-term leases, or other
property interests for the land that underlies our tower structures and intend to continue to do so to the extent available at
commercially reasonable prices. We believe that these perpetual easements, long-term leases, and other property interests will increase
our margins, improve our cash flow from operations, and minimize our exposure to increases in rents for property interests in the
future. As of December 31, 2024, approximately 72% of our tower structures were located on land that we own or control for more
than 20 years and the average remaining life under our ground leases and other property interests, including renewal options under our
control, was 36 years. As of December 31, 2024, approximately 11.6% of our tower structures had ground leases or other property
interests maturing in the next 10 years.
Exploring Opportunities in Evolving Technologies and Ancillary Services. In addition to our traditional tower-related
services, we continue to explore ancillary services and evolving technologies that we believe will allow us to create additional value
by leveraging our current assets, capabilities, and relationships with wireless service providers and others by expanding SBA’s
business within the growing communications ecosystem. This includes supporting efforts for edge data centers and private networks
utilizing cellular and Wi-Fi technologies. For example, we are exploring ways to participate in edge computing infrastructure to
support existing and future customers’ increasing need to deploy computing capabilities to locations closer to their end users, such as
regional data centers and smaller local data centers located at the base of our towers. SBA owns two regional data centers in the U.S.
and one regional data center in Brazil, as well as tower-based data centers in support of this initiative. With regard to open-access
networks, SBA works with real estate developers in deploying networks that are accessible throughout a community’s various
common areas and resident amenities. We have also partnered with carriers and high-traffic consumer retailers in developing systems
for the offloading of data to wireless networks. Additionally, we are exploring opportunities to leverage tower assets and infrastructure
to provide energy as a service, including through the deployment of on-site battery backup systems and solar energy solutions.
Industry Developments
We believe that growing wireless data traffic will require wireless service providers to continue to increase the capacity of
their networks, and we believe that the continued capacity increases will require our customers to install equipment at new sites and
add new equipment at existing sites. We expect that the wireless communications industry will continue to experience growth as a
result of the following trends:
Consumers are increasing their demand for wireless connectivity due to the adoption of bandwidth-intensive wireless data
applications, such as high-definition streaming, generative artificial intelligence, banking, gaming, social networking,
enhanced web browsing, and machine-to-machine applications. According to a report published by Ericsson in November
2024, global total mobile data traffic was estimated to reach around 157 exabytes per month by the end of 2024 and is
projected to grow by a factor of 3x to reach 473 exabytes per month in 2030.
3
The velocity of spectrum development is expected to remain dynamic as carriers continue to deploy new bands and
optimize bands that are currently in service, both of which activities we expect will require carriers to install equipment at
new sites and add new equipment at existing sites. For example, past and future spectrum auctions, such as Auction 108
and Auction 110 in the U.S. are expected to continue to contribute to growth in the upcoming years. In addition, the
continued deployment of 5G wireless technologies is expected to increase equipment installation at existing sites and may
increase the need for new sites.
Consumers list network quality as a key contributor when terminating or changing service. To remain competitive and to
decrease subscriber churn rates, wireless carriers have made substantial capital investments into their wireless networks to
improve service quality and expand coverage. We expect wireless carriers to continue to expend capital to differentiate
their product offerings.
We believe that the worldwide wireless industry will continue to grow and is reasonably well-capitalized, highly competitive
and focused on quality and advanced services; therefore, we expect that we will see a multi-year trend of additional demand for tower
space from our customers, which we believe will translate into steady leasing growth for us.
Our Businesses
Site Leasing Services
Our primary focus is the leasing of antenna space on our multi-tenant towers to a variety of wireless service providers under
long-term lease contracts in the United States, South America, Central America, Canada, and Africa. We derive site leasing revenues
primarily from wireless service provider tenants. Wireless service providers enter into (1) individual tenant site leases with us, each of
which relates to the lease or use of space at an individual site or (2) master lease agreements with us, which provide for the material
terms and conditions that will apply to multiple sites; although, in most cases, each individual site under a master lease agreement is
also governed by its own site leasing agreement which sets forth pricing and other site specific terms. Our site leasing business
generates substantially all of our total segment operating profit, representing 96.2% or more of our total segment operating profit for
the past three fiscal years. Our site leasing business is classified into two reportable segments, domestic site leasing and international
site leasing.
Domestic Site Leasing
As of December 31, 2024, we owned 17,464 sites in the United States and its territories. For the year ended December 31,
2024, we generated 73.7% of our total site leasing revenue from these sites. We derive domestic site leasing revenues primarily from
T-Mobile, AT&T Wireless, and Verizon Wireless. In the United States, our tenant leases are generally for an initial term of five years
to ten years with multiple renewal periods at the option of the tenant. These tenant leases typically contain specific annual rent
escalators, including renewal option periods. Our ground leases and other property interests in the United States are generally for an
initial term of five years or more with multiple renewal periods, which are at our option, and provide for specific annual rent
escalators. As of December 31, 2024, no U.S. state or territory accounted for more than 10% of our total tower portfolio by tower
count, and no U.S. state or territory accounted for more than 10% of our total revenues for the year ended December 31, 2024.
International Site Leasing
We currently own and operate towers in 13 international markets throughout South America, Central America, Canada, and
Africa. As of December 31, 2024, we owned 22,285 sites in our international markets, of which approximately 30% of our total
towers are located in Brazil and no other international markets (each country is considered a market) represented more than 5% of our
total towers. Our operations in our international markets are primarily in the site leasing business, and we continue to focus on
growing our international site leasing business through the acquisition and development of towers and organic growth.
We derive international site leasing revenues from all the major carriers in each of the 13 countries in which we operate. Our
tenant leases are generally for an initial term of five years to fifteen years with multiple renewal periods at the option of the tenant.
Our tenant leases typically either (1) contain specific annual rent escalators, (2) escalate annually in accordance with an inflationary
index, or (3) escalate using a combination of fixed and inflation adjusted escalators. In addition, our international site leases may
include pass-through charges, such as rent related to ground leases and other property interests, utilities, and fuel.
In our international markets, ground leases and other property interests are generally for an initial term of five years or more
with multiple renewal periods, which are at our option. Our ground leases typically either (1) contain specific annual rent escalators or
(2) escalate annually in accordance with an inflationary index.
4
In Ecuador, El Salvador, Guatemala, Nicaragua, and Panama, significantly all of our revenue, expenses, and capital
expenditures arising from our activities are denominated in U.S. dollars. Specifically, most of our ground leases and other property
interests, tenant leases, and tower-related expenses are paid in U.S. dollars. In most of our Central American markets, our local
currency obligations are principally limited to (1) permitting and other local fees, (2) utilities, and (3) taxes. In Brazil, Canada, Chile,
and South Africa, significantly all of our revenue, expenses, and capital expenditures, including tenant leases, ground leases and other
property interests, and other tower-related expenses are denominated in local currency. In Colombia, Costa Rica, Peru, and Tanzania,
our revenue, expenses, and capital expenditures, including tenant leases, ground leases and other property interests, and other tower-
related expenses are denominated in a mix of local currency and U.S. dollars.
Site Development Services
Our site development business, which is conducted in the United States only, is complementary to our site leasing business
and provides us the ability to keep in close contact with the wireless service providers that generate substantially all of our site leasing
revenue and to capture ancillary revenues that are generated by our site leasing activities, such as antenna and equipment installation
at our tower locations. Site development services revenues are earned primarily from providing a full range of end-to-end services to
wireless service providers or companies providing development or project management services to wireless service providers. Our
services include: (1) network pre-design; (2) site audits; (3) identification of potential locations for towers and antennas on existing
infrastructure; (4) support in leasing of the location; (5) assistance in obtaining zoning approvals and permits; (6) tower and related
site construction; (7) antenna installation; and (8) radio equipment installation, commissioning, and maintenance. We provide site
development services at our towers and at towers owned by others on a local basis through regional, market, and project offices. These
market offices are responsible for all site development operations.
Customers
We depend on a relatively small number of customers for our site leasing and site development revenues. The following
customers represented at least 10% of our total revenues during the last three years:
For the year ended December 31,
Percentage of Total Revenues
2024
2023
2022
T-Mobile
30.5%
32.5%
36.4%
AT&T Wireless
20.6%
19.5%
19.6%
Verizon Wireless
15.1%
14.6%
14.5%
In addition to the Big 3 wireless carriers (T-Mobile, AT&T Wireless, Verizon Wireless), we have also provided services or
leased space to a number of other customers during 2024 including:
Airtel Tanzania
Freedom Mobile
Tigo
C Spire (f/k/a Cellular South)
Liberty Technologies
TIM
Claro
MTN
Telefonica
Digicel
SouthernLinc
U.S. Cellular
Echostar (f/k/a DISH Wireless)
Telkom
Vodacom
Sales and Marketing
Our sales and marketing goals are to:
use existing relationships and develop new relationships with wireless service providers to lease antenna space on and sell
related services with respect to our owned towers or managed properties, enabling us to grow our site leasing business; and
successfully bid and win those site development services contracts that will contribute to our operating margins and/or
provide a financial or strategic benefit to our site leasing business.
We approach sales on a company-wide basis, involving many of our employees. We have a dedicated sales force that is
supplemented by members of our management team to sell our services and cultivate customer relationships. Our strategy is to
delegate sales efforts by geographic region or to those employees of ours who have the best relationships with our customers. Most
wireless service providers have national corporate headquarters with regional and local offices. We believe that wireless service
providers make most decisions for site development and site leasing services at the regional and local levels with input from their
corporate headquarters. Our sales representatives work with wireless service provider representatives at the regional and local levels
and at the national level when appropriate. Our sales staff’s compensation is heavily weighted to incentive-based goals and
measurements.
5
Competition
Domestic Site Leasing – In the U.S., our primary competitors for our site leasing activities are (1) large independent tower
companies including American Tower Corporation and Crown Castle International; (2) a number of regional independent tower
owners; (3) wireless service providers that own and operate their own towers and lease, or may in the future decide to lease, antenna
space to other providers; (4) owners and operators of alternative facilities such as rooftops, outdoor and indoor distributed antenna
system (“DAS”) networks, billboards, utility poles, and electric transmission towers; and (5) owners and operators of alternative
wireless technology systems and architectures.
International Site Leasing – Internationally, our competition consists of wireless service providers that own and operate their
own tower networks, large multinational, national, and regional independent tower companies, and alternative facilities such as
rooftop, outdoor and indoor networks, billboards, utility poles, and electric transmission towers.
We believe that tower location and capacity, quality of service, density within a geographic market, and price historically
have been, and will continue to be, the most significant competitive factors affecting the domestic and international site leasing
business.
Site Development – The site development business is competitive and price sensitive. We believe that the majority of our
competitors in the U.S. site development business operate within local region and market areas, while some firms offer their services
nationally. The market includes participants from a variety of market segments offering individual, or combinations of, competing
services. The field of competitors includes site development companies, zoning consultants, real estate firms, wireless construction
companies, tower owners, telecommunications equipment vendors, which provide end-to-end site development services through
multiple subcontractors, and wireless service providers’ internal staff. We believe that providers base their decisions for site
development services on a number of criteria, including company experience, price, track record, local reputation, geographic reach,
and time for completion of a project.
Human Capital
Our corporate offices are located in Boca Raton, Florida. We also have employees located in our international, regional, and
local offices. We consider our employee relations to be good. As of December 31, 2024, we had 1,720 employees of which 628 were
based outside of the U.S. and its territories.
Talent Management. We recognize and appreciate the impact our employees have on the success of our company, our
customers, and the communities we serve. We pride ourselves on our ownership mindset, agility and team spirit and provide customer
service with quality and integrity. We also value all those who serve our country and are proud to support military veterans and their
families as they transition out of the military.
We recognize the value of attracting, developing, engaging, and retaining our talent. We invest in our employees’
professional growth and development by providing resources and opportunities to develop their skills and expand their expertise. We
see diversity of thought and experiences as critical factors to the long-term success of SBA. We are committed to building a pipeline
of future business leaders by recruiting and retaining talent from the communities and markets we serve.
Employee Well-Being. The well-being of our employees is a critical element of our culture, employee engagement, and
productivity. Our global compensation and benefits strategy provides programs and resources focused on overall well-being. We offer
a competitive total rewards package which includes market-based pay, performance-based annual incentive awards, healthcare and
retirement benefits, holiday and paid time off, and tuition assistance.
Health and Safety. At SBA, providing a safe and healthy work environment for the protection of our employees is paramount.
The safety of our tower technicians has been a critical focus of the company since our founding. In 2013, we opened our central
training facility "Tower U" which provides a rigorous safety certification program that is required for our tower technicians. We are
proud that our average lost-day incident rate in the U.S. (days away from work due to workplace incidents) for 2024 was below the
2023 Bureau of Labor benchmark.
Regulatory and Environmental Matters
Federal Regulations. In the U.S., which accounted for 73.7% of our total site leasing revenue for the year ended December
31, 2024, both the Federal Communications Commission (the “FCC”) and the Federal Aviation Administration (the “FAA”) regulate
towers. Many FAA requirements are implemented in FCC regulations. These regulations govern the construction, lighting, and
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painting or other marking of towers, as well as the maintenance, inspection, and record keeping related to towers, and may, depending
on the characteristics of particular towers, require prior approval and registration of towers before they may be constructed, altered or
used. Wireless communications equipment and radio or television stations antennas operating on towers are separately regulated and
may require independent customer licensing depending upon the particular frequency or frequency band used. In addition, any
applicant for an FCC tower structure registration (through the FCC’s Antenna Structure Registration System) must certify that,
consistent with the Anti-Drug Abuse Act of 1988, neither the applicant nor its principals are subject to a denial of federal benefits
because of a conviction for the possession or distribution of a controlled substance. New tower construction also requires approval
from the state or local governing authority for the proposed site, compliance with the National Environmental Policy Act (“NEPA”),
compliance with the National Historic Preservation Act (“NHPA”), compliance with the Endangered Species Act (“ESA”), and may
require notification to the FAA and registration with the FCC.
Pursuant to the requirements of the Communications Act of 1934, as amended, the FCC, in conjunction with the FAA, has
developed standards to consider proposals involving new or modified towers. These standards mandate that the FCC and the FAA
consider the height of the proposed tower, the relationship of the tower to existing natural or man-made obstructions, and the
proximity of the tower to runways and airports. Proposals to construct or to modify existing towers above certain heights must be
reviewed by the FAA to ensure the structure will not present a hazard to air navigation. The FAA may condition its issuance of a no-
hazard determination upon compliance with specified lighting and/or painting requirements. Towers that meet certain height and
location criteria must also be registered with the FCC. A tower that requires FAA clearance will not be registered with the FCC until it
is cleared by the FAA. The FCC’s Antenna Structure Registration (ASR) will include any FAA required lighting and/or painting.
Owners of wireless communications towers have an obligation to maintain painting and lighting or other marking in conformance with
FAA and FCC regulations. While the FCC requires owners to register and exercise primary responsibility for painting and lighting of
antenna structures meeting the registration criteria, licensees, and permittees, collocated on the tower or antenna structure, are also
responsible to ensure that the structure maintains all FAA and FCC painting and lighting requirements.
Owners and operators of towers may be subject to, and therefore must comply with, environmental laws, including NEPA,
NHPA, and ESA. Any licensed radio facility on a tower is subject to environmental review pursuant to NEPA, among other statutes,
which requires federal agencies to evaluate the environmental impact of their decisions under certain circumstances. The FCC has
issued regulations implementing NEPA. These regulations place responsibility on applicants to investigate potential environmental
effects of their operations and to disclose any potential significant effects on the environment in an environmental assessment prior to
constructing or modifying a tower and prior to commencing certain operations of wireless communications or radio or television
stations from the tower. In the event the FCC determines the proposed structure or operation would have a significant environmental
impact based on the standards the FCC has developed, the FCC would be required to prepare an environmental impact statement,
which will be subject to public comment. This process could significantly delay the registration of a particular tower.
We generally indemnify our customers against any failure to comply with legal and regulatory compliance requirements
applicable to tower owners or operators relating to the construction, modification, or placement of towers. Failure to comply with the
applicable requirements may lead to civil penalties.
The Telecommunications Act of 1996 amended the Communications Act of 1934 by preserving state and local zoning
authorities’ jurisdiction over the construction, modification, and placement of towers. The law, however, limits local zoning authority
by prohibiting any action that would discriminate among different providers of personal wireless services or ban altogether the
construction, modification or placement of radio communication towers. Finally, the Telecommunications Act of 1996 and the FCC’s
rules implementing that Act require the federal government to help licensees for wireless communications services gain access to
preferred sites on federal property for their facilities. This may require that federal agencies and departments work directly with
licensees to make federal property available for tower facilities.
Operators of towers must also take into consideration certain radio frequency (“RF”) emissions regulations that impose a
variety of procedural and operating requirements. Certain proposals to operate wireless communications and radio or television
stations from tower structures are also reviewed by the FCC to ensure compliance with requirements relating to human exposure to RF
emissions.
Environmental Regulation. As an owner and operator of real property, we are subject to certain environmental laws that
impose strict, joint and several liability for the cleanup of on-site or off-site contamination and related personal injury or property
damage. We are also subject to certain environmental laws that govern tower placement and may require pre-construction
environmental studies. We comply with the FCC National Environmental Policy Act (NEPA) which requires screening for
environmental impacts including the evaluation of those of our tower site locations (1) that might be located in a wilderness area or a
wildlife preserve, (2) that might affect threatened and endangered species or their habitat (ESA), (3) that might affect properties
included in, or eligible for inclusion, in the National Register of Historic Places (NRHP) or Indian religious and cultural sites, (4) that
might affect World Heritage areas and IUCN Category I-IV protected areas, (5) that will be located in a floodplain and where facility
7
equipment will not be placed at least one foot above the base flood elevation of the floodplain, (6) whose construction will involve
significant changes in surface features (e.g., in wetlands, water diversions, considerable ground disturbance, deforestation), (7) that
might affect migratory birds if the towers are over 450 feet, (8) that involve high-intensity lighting in a residential area, (9) that would
cause RF radiation over FCC-established limits, and (10) that would involve similar considerations under the laws or best practices of
our international markets. When a tower site is impacted by any of the listed categories, we promptly complete an environmental
assessment and obtain approval from the appropriate regulatory agency, which may include steps to mitigate the impact of
construction or operation of the site. Our regional site managers regularly inspect our tower sites and report on any environmental or
compliance issues. This ensures we minimize our environmental impact and remain compliant during the operational life of our assets.
We believe that we are in substantial compliance with and we have no material liability under any applicable environmental
laws. These costs of compliance with existing or future environmental laws and liability related thereto may have a material adverse
effect on our prospects, financial condition or results of operations.
State and Local Regulations. Most states regulate certain aspects of real estate acquisition, leasing activities, and construction
activities. Where required, we conduct the site acquisition portions of our site development services business through licensed real
estate brokers’ agents, who may be our employees or hired as independent contractors, and conduct the construction portions of our
site development services through licensed contractors, who may be our employees or independent contractors. Local regulations
include city and other local ordinances, zoning restrictions, and restrictive covenants imposed by community developers. These
regulations vary greatly from jurisdiction to jurisdiction, but typically require tower owners to obtain approval from local officials or
community standards organizations, or certain other entities prior to tower construction and establish regulations regarding
maintenance and removal of towers. FCC rules establish presumptively reasonable time periods for state and local authorities to act on
applications to collocate a facility or deploy a facility, such as a tower. In addition, many local zoning authorities require tower owners
to post bonds or cash collateral to secure their removal obligations. Local zoning authorities generally have been unreceptive to
construction of new towers in their communities because of the height and visibility of the towers, and have, in some instances,
instituted moratoria. However, in August 2018, the FCC issued a declaratory ruling stating that express and de facto moratoria on
deployment of telecommunications facilities violate the Communications Act. This FCC ruling has been affirmed by a federal
appellate court.
International Regulations. Regulatory regimes outside of the U.S. and its territories vary by country and locality; however,
these regulations typically require tower owners and/or licensees to obtain approval from local officials or government agencies prior
to tower construction or modification or the addition of a new antenna to an existing tower. Additionally, some regulations include
ongoing obligations regarding painting, lighting, and maintenance. Our international operations may also be subject to limitations on
foreign ownership of land in certain areas. Based on our experience to date, these regimes have been similar to, but not more rigorous,
burdensome or comprehensive than, those in the U.S. Non-compliance with such regulations may lead to monetary penalties or
deconstruction orders. Our international operations are also subject to various regulations and guidelines regarding employee relations
and other occupational health and safety matters. As we expand our operations into additional international geographic areas, we will
be subject to regulations in these jurisdictions.
Availability of Reports and Other Information
SBA Communications Corporation was incorporated in the State of Florida in March 1997 and is a real estate investment
trust (“REIT”) for federal income tax purposes. Our corporate website is www.sbasite.com. We make available, free of charge, access
to our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, Proxy Statement on Schedule
14A and amendments to those materials filed or furnished pursuant to Section 13(a) or 15(d) of the Securities and Exchange Act of
1934, as amended (the “Exchange Act”), on our website under “Investors – SEC Filings,” as soon as reasonably practicable after we
file electronically such material with, or furnish it to, the United States Securities and Exchange Commission (the “Commission”).
ITEM 1A. RISK FACTORS
Risks Related to Our Business
If our wireless service provider customers combine their operations to a significant degree, our future operating results could be
adversely affected.
Our domestic and international wireless service providers have and may continue to be subject to consolidation pressures
arising from competitive pressures, spectrum limitations, the significant capital expenditures necessary to build out national networks
on evolving technology and governmental policies seeking to limit the telecommunications infrastructure footprint within a market.
Significant consolidation among our wireless service provider customers has resulted, and is expected to continue to result, in our
8
customers failing to renew existing leases for tower space as a result of overlapping coverage, nearby locations, or reducing future
capital expenditures in the aggregate because their existing networks and expansion plans may overlap or be very similar. For
example, historically, U.S. wireless service providers have grown through acquisitions. As a result, the combined companies have
rationalized duplicative parts of their networks, or networks have been discontinued. During 2020, the consolidation of T-Mobile and
Sprint was completed, and we began to experience non-renewal (“churn”) of certain leases as a result of overlapping and adjacent
Sprint leases. We currently expect that this churn will represent an aggregate of between $115.0 million and $125.0 million of cash
site leasing revenue from 2025 through 2028. We do not expect the annual churn to be uniform over this period as the timing of the
churn will depend on termination rights as well as the needs of the carrier. Future consolidations of wireless service providers could
significantly impact the number of our tower leases that are not renewed or the number of new leases that our wireless service
provider customers require to expand their networks, which could materially and adversely affect our future operating results.
The wireless industry in our international markets has come under competition in recent years which has, and may continue to,
adversely affect our international site leasing activities in the near term.
In recent years the wireless industry in our international markets has come under competitive pressures arising from an
increase in the number of industry participants (both wireless service providers and tower owners), increased cost of capital and
capital expenditure requirements, declining discretionary income and changing technology requirements. These pressures have
resulted, and may continue to result, in increases in consolidation of wireless service providers, financial instability of wireless service
providers, increased pricing pressures on tower operators and the termination or non-renewal of site leasing agreements. We expect
that the impact of these competitive pressures will continue in the near term as the industry begins to rebalance and as a result, we
expect approximately $27.0 to $31.0 million of churn for the 2025 fiscal year. If we are unable to manage the short-term impact of
these competitive pressures or if the competitive dynamics within our international markets do not stabilize in the foreseeable future, it
could have a material and adverse effect on our international site leasing revenue, our future growth and our business.
We depend on a relatively small number of customers for most of our revenue, and the loss or financial instability of any of our
significant customers may materially decrease our revenue and adversely affect our financial condition.
We derive a significant portion of our revenue from a small number of customers. In the United States and in most of our
international markets, there are only two to three primary wireless carriers. Consequently, a reduction in demand for site leasing,
reduced future capital expenditures or operating expenses on the networks, or the loss, as a result of bankruptcy, merger with other
customers of ours or otherwise, of any of our largest customers could materially decrease our revenue and have an adverse effect on
our growth. Furthermore, while many of our tenants in our international markets are subsidiaries of global telecommunications
companies, these subsidiaries may not have the explicit or implied financial support of their parent entities, which may impact their
creditworthiness. Our growth projections are based on our beliefs regarding future revenue from these customers, and such projections
could be adversely affected by the loss, consolidation or financial instability of these customers.
We derive revenue through numerous site leasing and site development contracts. In the United States and our international
markets, each site leasing contract relates to the lease of space at an individual tower and is generally for an initial term of five years to
fifteen years with multiple renewal periods at the option of the tenant. However, if any of our significant site leasing customers were
to experience financial difficulty, substantially reduce their capital expenditures or reduce their dependence on leased tower space on
our sites and fail to renew their leases with us, our revenues, future revenue growth and results of operations would be adversely
affected.
Our site development customers engage us on a project-by-project basis, and a customer can generally terminate an
assignment at any time without penalty. In addition, a customer’s need for site development services can decrease, and we may not be
successful in establishing relationships with new customers. Furthermore, our existing customers may not continue to engage us for
additional projects.
While the U.S. wireless service provider market has recently reduced to three nationwide wireless service providers, AT&T
Wireless, T-Mobile, and Verizon Wireless, we and most of the industry anticipate that the number of nationwide wireless service
providers will increase to four again if Echostar successfully builds out its nationwide network. If Echostar is unable to successfully
build-out its wireless network or is unable to successfully compete for customers once its network is built out, then our dependence on
the three U.S. wireless service providers for our financial and operational growth will be exacerbated.
9
The following is a list of significant customers (representing at least 10% of revenue in any of the last three years) and the
percentage of our total revenues for the specified time periods derived from these customers:
For the year ended December 31,
Percentage of Total Revenues
2024
2023
2022
T-Mobile
30.5%
32.5%
36.4%
AT&T Wireless
20.6%
19.5%
19.6%
Verizon Wireless
15.1%
14.6%
14.5%
We also have customer concentrations with respect to revenues in each of our financial reporting segments:
For the year ended December 31,
Percentage of Domestic Site Leasing Revenue
2024
2023
2022
T-Mobile
38.1%
40.2%
40.6%
AT&T Wireless
29.6%
28.6%
29.0%
Verizon Wireless
20.1%
19.7%
20.1%
For the year ended December 31,
Percentage of International Site Leasing Revenue
2024
2023
2022
Telefonica
21.3%
22.5%
20.7%
Claro
19.2%
20.2%
19.0%
TIM
15.9%
15.7%
17.3%
For the year ended December 31,
Percentage of Site Development Revenue
2024
2023
2022
T-Mobile
69.9%
71.5%
80.1%
Verizon Wireless
20.1%
16.8%
7.8%
If our wireless service provider customers are unable to access sufficient capital, or unwilling based on the economic cost of such
capital or other reasons, to invest in their infrastructure or spectrum, it could reduce our ability to meet our growth expectations.
Each wireless service provider must have substantial capital resources and capabilities to deploy new spectrum in their
wireless networks, including licenses for spectrum. Increasing interest rates have impacted, and are expected to continue to impact, the
ability and willingness of wireless service providers to incur capital expenditures at historic levels to expand their networks, which
would adversely affect our future revenue growth rates. For example, certain providers are financially constrained and are not
currently investing in their wireless networks to deploy new spectrum. Higher interest rates increase the economic cost of available
capital and may make it less favorable for wireless service providers to obtain capital for investment. If some or all of our wireless
service provider customers, or potential customers, are unable to access sufficient capital, or unwilling based on the economic cost of
such capital, to invest in the expansion of their networks, it could adversely affect our revenue growth. Wireless capital expenditures
may also be adversely impacted by service provider decisions on debt levels, dividends, free cash flow goals, and a variety of other
factors.
Our variable rate indebtedness and refinancing obligations subject us to interest rate risk, which could cause our debt service
obligations to increase significantly.
Pursuant to the terms of our Credit Agreement, the interest rate that we pay on indebtedness incurred under the Revolving
Credit Facility and the Term Loans varies based on a fixed margin over either a base rate or a Eurodollar rate which references the
SOFR rate. As of December 31, 2024, this indebtedness represented approximately $2.3 billion, or 16.7% of our total indebtedness.
As a result, we are exposed to interest rate risk. Interest rates, including SOFR, fluctuate periodically and as such may increase in
future periods. If interest rates increase, our debt service obligations on the variable rate indebtedness will increase even though the
amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our indebtedness, will
correspondingly decrease. Due to inflationary pressures on the U.S. economy and governmental action to combat inflation, interest
rates have risen significantly in the past two years, and interest rates may increase in the future, which will likely increase our interest
expense on our variable rate indebtedness and decrease our net income. In addition, increasing interest rates may result in higher
interest expense on our current fixed rate indebtedness upon a refinancing.
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Although we have used interest rate swaps to mitigate our interest rate risk from time to time, we may not maintain interest
rate swaps with respect to all of our variable rate indebtedness, and any swaps we enter into may not fully mitigate our interest rate
risk. Furthermore, the increase in our use of derivative instruments increases our exposure to counterparty credit risk to the extent that
a counterparty to the instrument fails to meet or perform the terms of the instrument. As of December 31, 2024, we had an interest rate
swap agreement on a portion of our 2024 Term Loan (as amended on October 2, 2024) which swaps $1.95 billion of notional value
accruing interest at one month Term SOFR plus 175 basis points for an all-in fixed rate of 1.800% per annum through March 31,
2025. Additionally, we have two $1.0 billion forward-starting swaps with an effective start date of March 31, 2025 (coinciding with
the expiration date of the current 0.050%, $1.95 billion notional value swap) and a maturity date of April 11, 2028. The combined
notional value of both forward-starting swaps of $2.0 billion will effectively fix one month term SOFR for a blended all-in fixed rate
of 5.165% per annum through April 11, 2028.
We have a substantial level of indebtedness which may have an adverse effect on our business or limit our ability to take advantage
of business, strategic or financing opportunities.
As indicated below, we have and will continue to have a significant amount of indebtedness. The following table sets forth
our total principal amount of debt and shareholders’ deficit as of December 31, 2024 and 2023:
As of December 31,
2024
2023
(in thousands)
Total principal amount of indebtedness
$
13,672,750
$
12,388,000
Shareholders' deficit
$
(5,109,938) $
(5,170,882)
Our substantial level of indebtedness increases the possibility that we may be unable to generate cash sufficient to pay the
principal, interest, or other amounts due on our indebtedness. Subject to certain restrictions under our existing indebtedness, we and
our subsidiaries may also incur significant additional indebtedness in the future, which may have the effect of increasing our total
leverage.
As a consequence of our indebtedness, (1) demands on our cash resources may increase, (2) we are subject to restrictive
covenants that further limit our financial and operating flexibility, and (3) we may choose to institute self-imposed limits on our
indebtedness based on certain considerations including market interest rates, our relative leverage and our strategic plans. For
example, as a result of our substantial level of indebtedness and the uncertainties arising in the credit markets and the U.S. economy:
• we may be more vulnerable to general adverse economic and industry conditions;
• we may have to pay higher interest rates upon refinancing or on our variable rate indebtedness if interest rates rise, thereby
reducing our cash flows;
• we may find it more difficult to obtain additional financing to fund future working capital, capital expenditures, and other
general corporate requirements that would be in our best long-term interests;
• we may be required to dedicate a substantial portion of our cash flow from operations to the payment of principal and
interest on our debt, reducing the available cash flow to fund other investments, including share repurchases, tower
acquisitions, and new build capital expenditures, or to satisfy our REIT distribution requirements;
• we may have limited flexibility in planning for, or reacting to, changes in our business or in the industry;
• we may have a competitive disadvantage relative to other companies in our industry that are less leveraged; and
• we may be required to sell debt or equity securities or sell some of our core assets, possibly on unfavorable terms, in order
to meet payment obligations.
Increasing competition in the tower industry may create pricing pressures or result in non-renewals that may materially and
adversely affect us.
Our industry is highly competitive, and our wireless service provider customers often have alternatives for leasing antenna
space. We believe that tower location and capacity, quality of service, density within a geographic market, and price historically have
been and will continue to be the most significant competitive factors affecting the site leasing business. However, competitive pricing
pressure for tenants on towers from our competitors have and may in the future result in us entering into master lease agreements that
may impact certain terms of existing or future individual site lease agreements. Terms that may be impacted include pricing discounts,
term concessions, and equipment rights. Competition for tenants, whether or not resulting in master lease agreements, may materially
and adversely affect our lease rates or lead to non-renewal of existing leases. Furthermore, pricing pressures could lead to more
prevalent network sharing, both domestically and internationally, which could reduce the demand for our tower space or lead to non-
renewals of existing leases. In addition, the increasing number of towers (1) may provide customers the ability to relocate their
antennas to other towers if they determine that a more suitable, efficient or economical location exists, which could lead to non-
renewal of existing leases, or (2) may adversely impact our ability to enter into new customer leases. This impact may be exacerbated
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if competitors construct towers near our existing towers. Any of these factors could materially and adversely affect our growth rate
and our future operations.
In the site leasing business, we compete with:
• wireless service providers that own and operate their own towers and lease, or may in the future decide to lease, antenna
space to other providers;
• national and regional tower companies who may be substantially larger and have greater financial resources than we do;
• international tower companies who have been in the international market for a longer period of time than we have; and
• alternative facilities such as rooftops, outdoor and indoor DAS networks, billboards, and electric transmission towers.
The site development segment of our industry is also competitive. There are numerous large and small companies that offer
one or more of the services offered by our site development business. As a result of this competition, margins in this segment may
come under pressure. Many of our competitors have lower overhead expenses and therefore may be able to provide services at prices
that we consider unprofitable. If margins in this segment were to decrease, our consolidated revenues and our site development
segment operating profit could be adversely affected.
A slowdown in demand for wireless services could materially and adversely affect our future growth and revenues.
We expect a significant portion of our future revenue growth will result from increased leasing activity and investments in
the deployment of new or fallow spectrum by our wireless service provider customers. Wireless service providers typically invest in
their networks in response to consumer demand for additional or higher quality service. Potential periods of economic downturn or
decreases in discretionary income may also reduce consumer spending on, and demand for additional or higher quality wireless
services. If consumers significantly reduce their use of wireless services or fail to widely adopt and use new wireless technologies and
their products and applications, our wireless service provider customers could experience a reduction in the rate of growth of or a
decrease in demand for their services and therefore reduce the amount they invest in their network. In addition, a slowdown may
increase competition in the tower industry which may in turn increase our exposure to the risks described herein.
Increasing competition may negatively impact our ability to grow our communication site portfolio long term.
We intend to continue growing our tower portfolio, domestically and internationally, through acquisitions and new builds.
Our ability to meet our growth targets significantly depends on our ability to build or acquire existing towers that meet our investment
requirements. Traditionally, our acquisition strategy has focused on acquiring towers from smaller tower companies, independent
tower developers, and wireless service providers. However, as a result of consolidation in the tower industry, there are fewer of these
tower transactions available, and there is more competition to acquire existing towers. Increased competition for acquisitions may
result in fewer acquisition opportunities for us, higher acquisition prices, and increased difficulty in negotiating and acquiring such
towers. Furthermore, to the extent that the tower acquisition opportunities are for significant tower portfolios, some of our competitors
and financial sponsors are significantly larger and have greater financial resources than we do. Finally, laws regulating competition,
domestically and internationally, may limit our ability to acquire certain portfolios and/or delay our acquisition of certain portfolios.
As a result of these risks, the cost of acquiring these towers may be higher than we expect, or we may not be able to meet our annual
and long-term tower portfolio growth targets. If we are not able to successfully address these challenges, we may not be able to
materially increase our tower portfolio in the long-term through acquisitions.
Our ability to build new towers is dependent upon our wireless customers’ needs and the availability of sufficient capital to
fund construction, our ability to locate, and acquire at commercially reasonable prices, attractive locations for such towers and our
ability to obtain the necessary zoning and permits. Local regulations, including municipal or local ordinances, zoning restrictions and
restrictive covenants imposed by community developers, vary greatly, but typically require antenna tower and structure owners to
obtain approval from local officials or community standards organizations prior to tower or structure construction or modification.
With respect to our international new builds, our tower construction may be delayed or halted as a result of local zoning restrictions,
inconsistencies between laws or other barriers to construction in international markets. Due to these risks, it may take longer to
complete our new tower builds than anticipated, domestically and internationally, and the costs of constructing these towers may be
higher than we expect, or we may not be able to add as many towers as planned in 2025. With respect to our domestic new builds,
attractive locations may be scarce due to the density within a geographic market. If we are not able to increase our new build tower
portfolio as anticipated, it could negatively impact our ability to achieve our financial goals.
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Our international operations are subject to economic, political, and other risks that could materially and adversely affect our
revenues or financial position.
Our current business operations in developing markets, and our expansion into any other international markets in the future,
could result in adverse financial consequences and operational problems not typically experienced in the United States. The site
leasing revenues generated by our international operations were approximately 24.8% of our total revenues during the year ended
December 31, 2024, and we anticipate that our revenues from our international operations will continue to grow in the future.
Accordingly, our business is and will be subject to risks associated with doing business internationally, including:
• laws and regulations that dictate how we operate our towers and conduct business and which may be uncertain, be
inconsistent or adversely change, including those relating to zoning, construction, maintenance and environmental matters,
and laws related to ownership of real property;
• changes in a specific country’s or region’s political or economic conditions, including inflation or currency devaluation;
• laws affecting telecommunications infrastructure including the sharing of such infrastructure;
• potential changes in trade restrictions and tariffs that may be proposed by the U.S. and potential retaliatory trade
restrictions and tariffs by other countries;
• laws and regulations that tax or otherwise restrict repatriation of earnings or other funds or otherwise limit distributions of
capital;
• changes to existing or new domestic or international tax laws, new or significantly increased municipal fees directed
specifically at the ownership and operation of towers, which may be applied and enforced retroactively and could
materially affect the profitability of our operations;
• expropriation and governmental regulation restricting foreign ownership or requiring reversion or divestiture;
• governmental regulations and restrictions impacting tower licenses, spectrum licenses and concessions, including
additional restrictions on the use or revocation of such licenses, concessions or spectrum and additional conditions to
receive or maintain such licenses;
• laws and regulations governing our employee relations, including occupational health and safety matters and employee
compensation and benefits matters;
• our ability to comply with, and the costs of compliance with, anti-bribery laws such as the Foreign Corrupt Practices Act
and similar local anti-bribery laws;
• our ability to negotiate, and enforce, leases or other contracts on similar terms as that of our U.S. operations;
• uncertainties regarding interpretations of our contractual rights to land and towers;
• uncertainties regarding legal or judicial systems, including inconsistencies between and within laws, regulations and
decrees, and judicial application thereof, and delays in the judicial process;
• challenges arising from less-developed infrastructure in certain markets;
• difficulty in recruiting and retaining trained personnel; and
• our ability to provide power to our sites in those international markets that do not have an available electric grid at our
tower sites.
We are also exposed to risks operating in countries with high levels of inflation, including the risk that inflation rates exceed
our fixed escalator percentages in markets where our leases include fixed escalators and the risk that adverse economic conditions may
discourage growth in consumer demand and consequently reduce our customers’ demand for our site leasing services. As of
December 31, 2024, approximately 21.1% of our tenant leases in our international markets include fixed escalators.
Currency fluctuations may negatively affect our results of operations.
In Ecuador, El Salvador, Guatemala, Nicaragua, and Panama, significantly all of our revenue, expenses, and capital
expenditures arising from our activities are denominated in U.S. dollars. Specifically, most of our ground leases and other property
interests, tenant leases, and tower-related expenses are paid in U.S. dollars. In Brazil, Canada, Chile, and South Africa significantly all
of our revenue, expenses, and capital expenditures, including tenant leases, ground leases and other property interests, and other
tower-related expenses are denominated in local currency. In Colombia, Costa Rica, Peru, and Tanzania, our revenue, expenses, and
capital expenditures, including tenant leases, ground leases and other property interests, and other tower-related expenses are
denominated in a mix of local currency and U.S. dollars. Our foreign currency denominated revenues and expenses are translated into
U.S. dollars at average exchange rates for inclusion in our consolidated financial statements.
For the year ended December 31, 2024, approximately 26.3% of our total site leasing revenue was generated by our
international operations, of which 23.1% was generated in non-U.S. dollar currencies, including 15.0% which was denominated in
Brazilian Reais. The exchange rates between our foreign currencies and the U.S. Dollar have fluctuated significantly in recent years
and may continue to do so in the future. For example, the Brazilian Real has historically been subject to substantial volatility and
weakened 6.9% when comparing the average rate for the years ended December 31, 2024 and 2023. This fluctuation has affected, and
may in the future continue to affect, our reported results of operations.
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Changes in exchange rates between these local currencies and the U.S. dollar will affect the recorded levels of site leasing
revenue, segment operating profit, assets and/or liabilities. Volatility in foreign currency exchange rates can also affect our ability to
plan, forecast, and budget for our international operations and expansion efforts.
Furthermore, we have intercompany loan agreements with our foreign subsidiaries to borrow in U.S. Dollars. As of
December 31, 2024 and 2023, the aggregate amount outstanding under the intercompany loan agreements subject to remeasurement
with our foreign subsidiaries was $1.1 billion and $1.3 billion, respectively. In accordance with Accounting Standards Codification
(“ASC”) 830, we remeasure foreign denominated intercompany loans with the corresponding change in the balance being recorded in
Other income (expense), net in our Consolidated Statements of Operations as settlement is anticipated or planned in the foreseeable
future. Consequently, if the U.S. Dollar strengthens against the Brazilian Real, South African Rand, or the Tanzanian Shilling, our
results of operations would be adversely affected. For the years ended December 31, 2024 and 2023, we recorded a $156.8 million
loss and a $52.4 million gain, net of taxes, respectively, on the remeasurement of intercompany loans due to changes in foreign
exchange rates. For the year ended December 31, 2024, we funded $9.3 million and repaid $177.1 million under our intercompany
loan agreements. Subsequent to December 31, 2024, we made no repayments under our intercompany loan agreements.
Delays in the roll-out of new spectrum or deployment of new technologies could materially and adversely affect our future growth
and revenues.
Our ability to grow is dependent on the ability and willingness of our wireless service provider customers to invest in the roll-
out of new spectrum or new technologies. Much of the future capital investment by domestic wireless service providers is expected to
result from the roll-out of 5G. However, the roll-out of prior spectrum, including 3G and 4G was often delayed and the roll-out of this
spectrum may encounter similar interruptions. For example, in January 2022, several major U.S. wireless carriers had to temporarily
delay deployment of new wireless facilities that were meant to facilitate the evolution of their wireless networks to 5G technology in
response to concerns of the aviation industry that those 5G facilities could interfere with equipment used for aviation and could
impede aviation safety. Although this issue has been substantially resolved, the deployment of new technologies has resulted, and may
continue to result, in unexpected issues that could increase the cost or delay the deployment of new technologies.
The FCC continues to auction new bands of spectrum, including Auction 108 and Auction 110. Our customers have been and
are expected to be the primary winners of these auctions and subsequently deploy this spectrum on our portfolio which would provide
us with a revenue growth opportunity. Any delays or failure of these auctions could negatively impact future demand for our towers.
Similarly, any delays in the clearing or availability of this spectrum subsequent to these auctions could delay the related demand for
our towers.
New technologies or network architecture or changes in a customer’s business model may reduce demand for our wireless
infrastructure or negatively impact our revenues.
Improvements or changes in the efficiency, architecture, and design of wireless networks or changes in a wireless service
provider customer's business model may reduce the demand for our wireless infrastructure. Also, as customers deploy increased
capital to develop and implement new technologies, they may allocate less of their budgets to lease space on our towers. For example,
new technologies that may promote network sharing, joint development, or resale agreements by our wireless service provider
customers, such as signal combining technologies or network functions virtualization, may reduce the need for our wireless
infrastructure, or may result in the decommissioning of equipment on certain sites because portions of the customers' networks may
become redundant. In addition, other technologies and architectures, such as WiFi, DAS, femtocells, other small cells, or satellite
(such as low earth orbiting) and mesh transmission systems may, in the future, serve as substitutes for, or alternatives to, the
traditional macro site communications architecture that is the basis of substantially all of our site leasing business. Certain small cell
complementary network technologies or satellite services could shift a portion of our customers’ network investments away from
traditional tower-based networks, which may reduce the need for carriers to add more equipment at certain communications sites. The
majority of our tower portfolio comprises traditional macro sites and therefore is not as diversified into non-macro sites and other
technologies and architectures as some of our competitors. In addition, new technologies that enhance the range, efficiency, and
capacity of wireless equipment could reduce demand for our wireless infrastructure. For example, our wireless service provider
customers have engaged in increased use of network sharing, roaming, or resale arrangements, resulting in reduced capital spending or
a decision to sell or not renew their spectrum licenses or concessions. Any significant reduction in demand for our wireless
infrastructure resulting from new technologies or new architectures or changes in a customer's business model may negatively impact
our revenues or otherwise have a material adverse effect on our business and results of operations. Any such event may have a
disproportionate impact on our business compared to our competitors, whose portfolios may be more technologically and
architecturally diversified than ours. In addition, while we are exploring and investing in ancillary services and emerging technologies,
including our mobile edge computing initiative and private networks, those investments may not prove to be profitable.
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These factors could also have a material adverse effect on our growth rate since growth opportunities and demand for our
tower space as a result of new technologies may not be realized at the times or to the extent anticipated. Any of these factors could
have a material adverse effect on our business, results of operations, and financial condition.
If we are unable to protect our rights to the land under our towers, it could adversely affect our business and operating results.
Our real property interests relating to the land under our tower structures consist primarily of leasehold and sub-leasehold
interests, fee interests, easements, licenses, rights-of-way, and other similar interests. From time to time, we experience disputes with
landowners regarding the terms of the agreements for the land under our tower structures, which can affect our ability to access and
operate such towers. Further, landowners may not want to renew their agreements with us, they may lose their rights to the land, or
they may transfer their property interests to third parties, including property interest aggregators and our competitors, which could
affect our ability to renew agreements on commercially viable terms or at all. Further, for various reasons, title to property interests in
some of the foreign jurisdictions in which we operate may not be as certain as title to our property interests in the United States.
As of December 31, 2024, the average remaining life under our ground leases and other property interests, including renewal
options under our control, was approximately 36 years, and approximately 11.6% of our tower structures have ground leases or other
property interests maturing in the next 10 years. Failure to protect our rights to the land under our towers may have a material adverse
effect on our site leasing revenue and future growth.
We hold some of our towers through rights of use agreements, which are terminable in accordance with the terms of the respective
agreements and provide us limited visibility regarding the relationship between the owner of the towers and the land owner.
We hold an aggregate of 4,069 towers through right of use agreements, pursuant to which we have the right to use and lease
space on the tower to third parties, but do not own the tower. These agreements typically provide for multiple renewal periods,
however, as these agreements are contractual, they may be terminated in accordance with their terms. If we were unable to renew our
right of use for these agreements, then we would likely lose the revenue generated by the leasing tenants on such towers as the tenants
may choose to remain on the tower to the extent feasible. In addition, as we do not own such towers, we are not a party to the ground
lease agreement with the owner of the land underlying the towers. Consequently, we may not have visibility to the relationship
between the land owner and the tower owner, including the term of any ground lease, and may not have the ability to promptly
intervene if the land owner takes, or fails to take action, that would risk continued use of the tower, such as a sale of the parcel to a
land aggregator, failure to pay taxes or condemnation actions. If the land owner was unable or unwilling to renew the ground lease
with the tower owner, we could lose our ability to use the tower irrespective of our right of use agreement. During the year ended
December 31, 2024, we generated $120.0 million of site leasing revenue from right of use towers. If we were to lose a significant
number of our right to use towers it could adversely affect our site leasing revenue.
We may not be able to fully recognize the anticipated benefits of towers that we acquire.
A key element of our growth strategy is to increase our tower portfolio through acquisitions. We are subject to a number of
risks and uncertainties as a result of those acquisition activities. These activities may fail to achieve the benefits we expected from the
acquisition, or the acquired assets may not meet our internal guidelines for current and future returns, particularly if we are required to
place greater reliance on the financial and operational representations and warranties of the sellers in individually material
acquisitions. The impact of these risks is further enhanced in acquisitions of towers in international markets, where it may be more
difficult to verify all relevant information with respect to the assets being acquired. These risks could adversely affect our revenues
and results of operations.
In addition, acquisitions which would be material in the aggregate may exacerbate the risks inherent with our growth
strategy, such as (1) an adverse financial impact if the acquired towers do not achieve the projected financial results, (2) the impact of
unanticipated costs associated with such acquisitions on our results of operations, (3) increased demands on our cash resources that
may impact our ability to explore other opportunities, (4) undisclosed and assumed liabilities that we may be unable to recover, (5) an
adverse impact on our existing customer relationships, (6) additional expenses and exposure to new regulatory, political, and
economic risks, and (7) diversion of managerial attention.
As part of new acquisitions of tower assets in natural disaster-prone areas, we may assess asset exposure to physical risks and
inspect assets for signs of climate-related damage to help us understand the degree of exposure to tornadoes, fires, hurricanes, floods,
and earthquakes the site may face over the longer term. However, our environmental due diligence may not uncover all natural
disaster-related risks to tower assets that we acquire, and our mitigation measures may not be successful, which could require us to
incur significant expenditures and may have an adverse effect on our operations or financial condition.
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The process of integrating any acquired towers into our operations is also subject to a number of risks and financial impacts,
including unforeseen operating difficulties, large expenditures, diversion of management attention, the loss of key customers and/or
personnel, our inability to retain or timely find suitable replacements for key employees and management needed to operate the
acquired business, and exposure to unanticipated liabilities. These risks may be exacerbated in acquisitions of a material number of
towers. There can be no assurance that we will be successful in integrating domestic and international acquisitions into our existing
business.
The documents governing our indebtedness contain restrictive covenants that could adversely affect our business by limiting our
flexibility.
The indentures governing the 2020 Senior Notes and the 2021 Senior Notes, the Senior Credit Agreement, and the agreement
for the mortgage loan underlying the Tower Securities contain restrictive covenants imposing significant operational and financial
restrictions on us, including restrictions that may limit our ability to engage in acts that may be in our long-term best interests. Among
other things, the covenants under each instrument limit our ability to:
• merge, consolidate or sell assets;
• make restricted payments, including pay dividends or make other distributions;
• enter into transactions with affiliates;
• enter into sale and leaseback transactions; and
• issue guarantees of indebtedness.
Additionally, the agreement governing the mortgage loan relating to our Tower Securities contains financial covenants that
require that the borrowers maintain, on a consolidated basis, a minimum debt service coverage ratio. To the extent that the debt service
coverage ratio, as of the end of any calendar quarter, falls to 1.30 times or lower, then all cash flow in excess of amounts required to
make debt service payments, to fund required reserves, to pay management fees and budgeted operating expenses and to make other
payments required under the loan documents, referred to as “excess cash flow,” will be deposited into a reserve account instead of
being released to the borrowers. The funds in the reserve account will not be released to the borrowers unless the debt service
coverage ratio exceeds 1.30 times for two consecutive calendar quarters. If the debt service coverage ratio falls below 1.15 times as of
the end of any calendar quarter, then an “amortization period” will commence and all funds on deposit in the reserve account will be
applied to prepay the mortgage loan until such time that the debt service coverage ratio exceeds 1.15 times for a calendar quarter.
The Senior Credit Agreement, as amended, requires SBA Senior Finance II LLC (“SBA Senior Finance II”) to maintain
specific financial ratios, including (1) a ratio of Consolidated Net Debt to Annualized Borrower EBITDA not to exceed 6.5 times for
any fiscal quarter and (2) a ratio of Annualized Borrower EBITDA to Annualized Cash Interest Expense (calculated in accordance
with the Senior Credit Agreement) of not less than 2.0 times for any fiscal quarter.
These covenants could place us at a disadvantage compared to some of our competitors which may have fewer restrictive
covenants and may not be required to operate under these restrictions. Further, these covenants could have an adverse effect on our
business by limiting our ability to take advantage of financing, new tower development, merger and acquisitions, or other
opportunities. If we fail to comply with these covenants, it could result in an event of default under our debt instruments. If any default
occurs, all amounts outstanding under our outstanding notes and the Senior Credit Agreement may become immediately due and
payable.
Our dependence on our subsidiaries for cash flow may negatively affect our business.
We are a holding company with no business operations of our own. Our only significant assets are, and are expected to be,
the outstanding capital stock and membership interests of our subsidiaries. We conduct, and expect to continue conducting, all of our
business operations through our subsidiaries. Accordingly, our ability to pay our obligations is dependent upon dividends and other
distributions from our subsidiaries to us. Most of our indebtedness is owed directly by our subsidiaries, including the mortgage loan
underlying the Tower Securities and any amounts that we may borrow under the Senior Credit Agreement. Consequently, the first use
of any cash flow from operations generated by such subsidiaries will be payments of interest and principal, if any, under their
respective indebtedness. Other than the cash required to repay amounts due under our 2020 Senior Notes and 2021 Senior Notes and
funds to be utilized for stock repurchases and dividend payments, we currently expect that substantially all the earnings and cash flow
of our subsidiaries will be retained and used by them in their operations, including servicing their respective debt obligations. The
ability of our operating subsidiaries to pay dividends or transfer assets to us is restricted by applicable state law and contractual
restrictions, including the terms of their outstanding debt instruments.
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The loss of the services of key personnel or a significant number of our employees may negatively affect our business.
Our success depends to a significant extent upon performance and active participation of our key personnel. We cannot
guarantee that we will be successful in retaining the services of these key personnel. Although we have an employment agreement
with Brendan T. Cavanagh, our President and Chief Executive Officer, this agreement does not ensure Mr. Cavanagh will continue
with us in his current capacity for any particular period of time. We do not have employment agreements with any of our other key
personnel. If any of our key personnel were to leave or retire, we may not be able to find an appropriate replacement on a timely basis
and our results of operations could be negatively affected. Further, the loss of a significant number of employees or our inability to
hire a sufficient number of qualified employees could have a material adverse effect on our business.
Our business is subject to government regulations and changes in current or future regulations could harm our business.
We are subject to federal, state, and local regulation of our business, both in the U.S. and internationally. In the U.S., both the
FAA and the FCC regulate the construction, modification, and maintenance of towers and structures that support antennas used for
wireless communications and radio and television broadcasts. In addition, the FCC separately licenses or otherwise regulates wireless
communications equipment, wireless radio stations, and radio and television broadcast stations operating from such towers. FAA and
FCC regulations govern construction, lighting, painting, and marking of towers and may, depending on the characteristics of the
tower, require registration of the tower. Certain proposals to construct new towers, or to modify or add new equipment to existing
towers, are reviewed by the FAA to ensure that the tower will not present a hazard to air navigation. Further, in connection with our
previous acquisition of a building containing a data center, we also acquired a limited number of residential apartment units and
became subject to additional federal, state, and local laws and regulations such as building, zoning, landlord/tenant, health and safety, and
accessibility governing residential housing.
Tower owners have an obligation to mark or paint such towers or install lighting to conform to FAA and FCC regulations and
to maintain such marking, painting, and lighting. Tower owners also bear the responsibility of notifying the FAA of any lighting
outages. Certain proposals to operate wireless communications and radio or television broadcast stations from towers are also
reviewed by the FCC to ensure compliance with environmental impact requirements established in federal statutes, including NEPA,
NHPA, and ESA. Failure to comply with existing or future applicable requirements may lead to civil penalties or other liabilities and
may subject us to significant indemnification liability to our customers against any such failure to comply. In addition, new
regulations may impose additional costly burdens on us, which may affect our revenues and cause delays in our growth. Local
regulations, including municipal or local ordinances, zoning restrictions, and restrictive covenants imposed by community developers,
vary greatly, but typically require tower owners to obtain approval from local officials or community standards organizations prior to
tower construction or modification. Local regulations can delay, prevent, or increase the cost of new construction, co-locations, or site
upgrades, thereby limiting our ability to respond to customer demand. In addition, new regulations may be adopted that increase
delays or result in additional costs to us. In our international operations, the impact of zoning, permitting, and related regulations and
restrictive covenants on our new builds, co-locations, and operations could be exacerbated as some of these markets may lack
established permitting processes for towers, have inconsistencies between national and local regulations, and have other barriers to
timely construction and permitting of towers. As a result, tower construction in some of our international markets may be delayed or
halted or our acquired towers may not perform as anticipated. These factors could have a material adverse effect on our future growth
and operations.
Information technology disruptions, including as a result of cybersecurity breaches, could compromise our information, which
would cause our business and reputation to suffer.
As part of our day-to-day operations, we rely on information technology and other computer resources and infrastructure to
carry out important business activities and to maintain our business records. Our computer systems, or those of our cloud or Internet-
based providers, could fail on their own accord and are subject to interruption or damage from power outages, computer and
telecommunications failures, computer viruses, security breaches (including through cyber-attack, data theft, and exploiting
potentially vulnerable services, such as virtual private networks and collaboration platforms as a result of remote working), errors,
catastrophic events such as natural disasters, and other events beyond our control. If our or our vendors’ computer systems and backup
systems are compromised, degraded, damaged, or breached, or otherwise cease to function properly, we could suffer interruptions in
our operations or unintentionally allow misappropriation of proprietary or confidential information (including information about our
tenants or landlords). This could damage our reputation and disrupt our operations and the services we provide to customers, which
could adversely affect our business and operating results. In addition, security incidents that impact our customers and other business
partners could adversely affect our business and operating results. Furthermore, our investments in ancillary services and emerging
technologies, including data centers and our mobile edge computing initiative, may leave us more vulnerable to security incidents,
create new exposure for us to different types of security incidents or exacerbate the impact of such incidents on our business and
operating results. In addition, we may, from time to time, upgrade our data processing systems and other operating technologies and
take other steps to improve the efficiency of our information technology. These upgrades may require us to divert financial,
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operational, technical and managerial resources which could adversely affect our business and operations. Additionally, if we are
unable to effectively upgrade and improve the efficiency of our information technology systems, we may experience disruptions to our
operations and services.
Data privacy and protection laws are evolving globally and present risks related to our handling of sensitive data that could result
in regulatory penalties or litigation.
A portion of the activities that support our business involve collection, storage, and transfer of sensitive data of our
employees, tenants, ground lessors, and other third parties, including residential tenants as a result of our previous data center
acquisition that included a limited number of residential apartment units. In recent years, there has been increased public attention
regarding the protection of personal data and security of data transfers, accompanied by legislation and regulations intended to
strengthen data protection and information security. The evolving nature of privacy laws in the U.S. and the other countries where we
have operations could impact our compliance costs in handling such data. Many data privacy regulations also grant private rights of
action, including Brazil's General Data Protection Law and certain state laws, such as California's Consumer Privacy Act. As
interpretation and enforcement of these and other future data privacy regulations and industry standards evolve, we may incur costs
related to litigation or regulatory penalties if we are alleged to be non-compliant.
Damage from natural disasters and other unforeseen events could adversely affect us.
Our towers are subject to physical climate-related risks and natural disasters (including as a result of any potential effects of
climate change) such as tornadoes, fires, hurricanes, floods, and earthquakes or may collapse for any number of reasons, including
structural deficiencies. In addition, we have energy sources on some of our tower sites, and any unforeseen incident may cause
damage to surrounding property. We maintain insurance to cover the estimated cost of replacing damaged towers and damage to
surrounding property, but these insurance policies are subject to loss limits, deductibles, and retentions. We also maintain third party
liability insurance, subject to loss limits, deductibles, and retentions, to protect us in the event of an accident involving a tower. An
incident involving our towers or tower sites for which we are uninsured or underinsured, or damage to a significant number of our
towers or surrounding property, could require us to incur significant expenditures and may have a material adverse effect on our
operations or financial condition and may harm our reputation.
To the extent that we are not able to meet our contractual obligations to our customers, due to a natural disaster or other
catastrophic circumstances, our customers may not be obligated or willing to pay their lease expenses; however, we may be required
to continue paying our fixed expenses related to the affected tower, including expenses for ground leases and other property interests.
If we are unable to meet our contractual obligations to our customers for a material portion of our towers, our operations could be
materially and adversely affected.
We could have liability under environmental laws that could have a material adverse effect on our business, financial condition
and results of operations.
Our operations, like those of other companies engaged in similar businesses, are subject to the requirements of various
federal, state, local, and foreign environmental and occupational safety and health laws and regulations (including climate-related laws
and regulations), including those relating to the management, use, storage, disposal, emission and remediation of, and exposure to,
hazardous and non-hazardous substances, materials, and wastes. As owner, lessee, or operator of numerous tower structures, we may
be liable for substantial costs of remediating soil and groundwater contaminated by hazardous materials without regard to whether we,
as the owner, lessee, or operator, knew of or were responsible for the contamination. We may be subject to potentially significant
fines, penalties, or taxes if we fail to comply with any of these requirements. The current cost of complying with these laws is not
material to our financial condition or results of operations. However, the requirements of these laws and regulations are complex,
change frequently, and could become more stringent in the future. It is possible that these requirements will change or that liabilities
will arise in the future in a manner that could have a material adverse effect on our business, financial condition, and results of
operations.
We could suffer adverse tax and other financial consequences if taxing authorities do not agree with our tax positions.
We are periodically subject to a number of tax examinations by taxing authorities in the states and countries where we do
business. We also have significant net operating losses (“NOLs”) in U.S. federal and state taxing jurisdictions. Generally, for U.S.
federal and state tax purposes, NOLs generated prior to the 2018 tax year can be carried forward and used for up to 20 years, and all of
our NOLs will remain subject to examination until three years after our NOLs are used or expire. NOLs generated starting in the 2018
tax year can be carried forward indefinitely but are subject to the 80% utilization limitation. We expect that we will continue to be
subject to tax examinations in the future. In addition, U.S. federal, state, and local, as well as international, tax laws and regulations
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are extremely complex and subject to varying interpretations. If our tax benefits, including from our use of NOLs or other tax
attributes, are challenged successfully by a taxing authority, we may be required to pay additional taxes or penalties, or make
additional distributions, which could have a material adverse effect on our business, results of operations and financial condition.
We are subject to income tax and other taxes in the geographic areas where we hold assets or operate, and we periodically
receive notifications of audits, assessments, or other actions by taxing authorities. In certain jurisdictions, taxing authorities may issue
notices and assessments that may not be reflective of the actual tax liability for which we will ultimately be liable.
In connection with a current assessment in Brazil, the taxing authorities have issued income tax deficiencies related to
purchase accounting adjustments for tax years 2017 through 2019. We disagree with the assessment and have filed an appeal with the
higher appellate taxing authorities. We will continue to vigorously contest the adjustments and expect to exhaust all administrative and
judicial remedies necessary to resolve the matters, which could be a lengthy process. There can be no assurance that these matters will
be resolved in our favor, and an adverse outcome, or any future tax examinations involving similar assertions, could have a material
effect on our results of operations or cash flows in any one period. As of December 31, 2024, we estimate the aggregate range of
reasonably possible losses in excess of amounts accrued to be between zero and $49.0 million; excluding penalties and interest of
$63.1 million.
Our issuance of equity securities and other associated transactions may trigger a future ownership change which may negatively
impact our ability to utilize NOLs in the future.
The issuance of equity securities and other associated transactions may increase the chance that we will have a future
ownership change under Section 382 of the Internal Revenue Code of 1986 (“Code”). We may also have a future ownership change,
outside of our control, caused by future equity transactions by our current shareholders. Depending on our market value at the time of
such future ownership change, an ownership change under Section 382 could negatively impact our ability to utilize our NOLs and
could result in us having to make additional cash distributions.
Our costs could increase and our revenues could decrease due to perceived health risks from RF energy.
The U.S. and other foreign governments impose requirements and other guidelines relating to exposure to RF energy.
Exposure to high levels of RF energy can cause negative health effects. The potential connection between exposure to low levels of
RF energy and certain negative health effects, including some forms of cancer, has been the subject of substantial study by the
scientific community in recent years. According to the FCC, the results of these studies to date have been inconclusive. However,
public perception of possible health risks associated with cellular and other wireless communications technologies (such as 5G) could
slow the growth of wireless companies and deployment of new technologies, which could in turn slow our growth. In particular,
negative public perception of, and regulations regarding, health risks could cause a decrease in the demand for wireless
communications services. Moreover, if a connection between exposure to low levels of RF energy and possible negative health
effects, including cancer, were demonstrated, we could be subject to numerous claims. Our current policies provide no coverage for
claims based on RF energy exposure. If we were subject to claims relating to exposure to RF energy, even if such claims were not
ultimately found to have merit, our financial condition could be materially and adversely affected.
Risks Related to Our Status as a REIT
Remaining qualified as a REIT involves highly technical and complex provisions of the Code. Failure to remain qualified as a
REIT would result in our inability to deduct dividends paid to our shareholders in computing our taxable income, thereby
increasing our tax obligations and reducing our available cash.
We originally elected to be taxed as a REIT commencing with our taxable year ended December 31, 2016. While we intend
to operate so that we remain qualified as a REIT, given the highly complex nature of the rules governing REITs, the importance of
ongoing factual determinations, the possibility of future changes in our circumstances, and the potential impact of future changes to
laws and regulations impacting REITs, no assurance can be given that we will qualify as a REIT for any particular year.
Changes to the tax laws or interpretations thereof, with or without retroactive application, could materially and adversely
affect our investors or us. We cannot predict how changes in the tax laws might affect our investors or us. New legislation,
U.S. Treasury Regulations, administrative interpretations, or court decisions could affect significantly and negatively our ability to
qualify as a REIT or the U.S. federal income tax consequences to our investors and us of such qualification.
Qualification as a REIT involves the application of highly technical and complex Code provisions for which only limited
judicial and administrative authorities exist. Even a technical or inadvertent violation could jeopardize our REIT qualification. Our
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qualification as a REIT will depend on our ability to satisfy tests concerning our organization, the nature and diversification of our
asset, the sources of our income, the amounts we regularly distribute to our shareholders, the diversity of our shareholder ownership,
and other requirements on a continuing basis. Our ability to satisfy the asset tests depends upon our analysis of the characterization
and fair market values of our assets, some of which are not susceptible to a precise determination, and for which we will not obtain
independent appraisals.
If we fail to qualify as a REIT in any taxable year, to the extent we have REIT taxable income and have utilized our net
operating losses (“NOLs”), we would be subject to U.S. federal income tax on our taxable income at regular corporate rates, and
dividends paid to our shareholders would not be deductible by us in computing our taxable income. Any resulting corporate tax
liability could be substantial and would reduce the amount of cash available for distribution to our shareholders, which in turn could
have an adverse impact on the value of our common stock. Unless we were entitled to relief under certain provisions of the Code, we
also would be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year in which we failed to
qualify as a REIT. If we fail to qualify for taxation as a REIT, we may need to borrow additional funds or liquidate assets to pay any
additional tax liability. Accordingly, funds available for investment and making payments on our indebtedness would be reduced.
The net income of our taxable REIT subsidiaries (“TRSs”) is not required to be distributed to us, and such undistributed TRS
income is generally not subject to our REIT distribution requirements. However, if the accumulation of cash or reinvestment of
significant earnings in our TRSs causes the fair market value of our securities in those entities to represent more than 20% of the value
of our total assets, as determined for REIT asset testing purposes, we would, absent timely responsive action, fail to remain qualified
as a REIT. If we continue our international expansion, our TRS fair market value may cause us to exceed the above thresholds.
Complying with REIT requirements, including the 90% distribution requirement, may limit our flexibility or cause us to forgo
otherwise attractive opportunities, including certain discretionary investments and potential financing alternatives.
To remain qualified as a REIT, we are required generally to distribute at least 90% of our REIT taxable income after the
utilization of any available NOLs (determined without regard to the dividends paid deduction and excluding net capital gain) each
year to our shareholders. Our determination as to the timing or amount of future dividends will be based on a number of factors,
including investment opportunities around our core business and the availability of our existing NOLs. To the extent that we satisfy
the 90% distribution requirement but distribute less than 100% of our REIT taxable income (after the application of available NOLs, if
any), we will be subject to U.S. federal corporate income tax on our undistributed taxable income. In addition, we will be subject to a
4% nondeductible excise tax if the actual amount that we pay out to our shareholders for a calendar year is less than a minimum
amount specified under the Code.
From time to time, we may generate REIT taxable income greater than our cash flow as a result of differences in timing
between the recognition of taxable income and the actual receipt of cash or the effect of nondeductible capital expenditures, the
creation of reserves or required debt or amortization payments. If we do not have other funds available in these situations, we may
need to borrow funds, sell assets or raise equity, even if the then-prevailing market conditions are not favorable for these borrowings,
sales, or offerings, to enable us to satisfy the REIT distribution requirement and to avoid U.S. federal corporate income tax and the 4%
excise tax in a particular year. These alternatives could increase our costs and our leverage, decrease our Adjusted Funds From
Operations, or require us to distribute amounts that would otherwise be invested in future acquisitions, new tower builds, or stock
repurchases.
Thus, compliance with the REIT requirements may hinder our ability to grow, which could adversely affect the value of our
common stock. Furthermore, compliance with the REIT distribution requirements may increase the financing we need to fund capital
expenditures, future growth, or expansion initiatives, which would increase our total leverage.
In addition to the 90% distribution requirement, to remain qualified as a REIT for federal income tax purposes, we must
continually satisfy tests concerning, among other things, the nature and diversification of our assets, the sources of our income and the
amounts we distribute to our shareholders. Compliance with these tests will require us to refrain from certain activities and may hinder
our ability to make certain attractive investments, including the purchase of non-qualifying assets, the expansion of non-real estate
activities, or investments in the businesses to be conducted by our TRSs. Furthermore, our ability to compete for acquisition
opportunities in domestic and international markets may be adversely affected if we need, or require, the target company to comply
with certain REIT requirements.
Moreover, if we fail to comply with certain asset ownership tests, at the end of any calendar quarter, we must correct the
failure within 30 days after the end of the calendar quarter or qualify for certain statutory relief provisions to avoid losing our REIT
qualification and suffering adverse tax consequences. As a result, we may be required to liquidate assets in adverse market conditions
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or forgo otherwise attractive investments. These actions may have the effect of reducing our income, amounts available for
distributions to our shareholders, and amounts available for making payments on our indebtedness.
Covenants specified in our current and future debt instruments may limit our ability to make required REIT distributions.
The mortgage loan agreement related to our securitization transactions, the Senior Credit Agreement, and the indentures
governing our 2020 Senior Notes and 2021 Senior Notes contain certain covenants that could limit our ability to make distributions to
our shareholders. Under the mortgage loan agreement related to our securitization transactions, a failure to comply with the Debt
Service Coverage Ratio in that agreement could prevent our borrower subsidiaries from distributing any excess cash from the
operation of their towers to us. In addition, while the Senior Credit Agreement permits our subsidiaries to make distributions to us to
satisfy our REIT distribution requirements, this authority is subject to condition that our subsidiaries are not then in default of their
payment obligations under the Senior Credit Agreement or that we or any of our subsidiaries have filed an action relating to
bankruptcy, insolvency, reorganization or relief of debtors. Furthermore, while the indentures governing the 2020 Senior Notes and
2021 Senior Notes permit us to make distributions to our shareholders to the extent such distributions are necessary to maintain our
status as a REIT or to avoid entity level taxation, this authority is subject to the conditions that no default or event of default exists or
would result therefrom and that the obligations under the 2020 Senior Notes or 2021 Senior Notes, as applicable, have not otherwise
been accelerated.
If these limitations prevent us from satisfying our REIT distribution requirements, we could fail to qualify for taxation as a
REIT. If these limitations do not jeopardize our qualification for taxation as a REIT but do nevertheless prevent us from distributing
100% of our REIT taxable income, we will be subject to U.S. federal corporate income tax, and potentially the nondeductible 4%
excise tax, on the retained amounts.
Our payment of cash distributions in the future is not guaranteed and the amount of any future cash distributions may fluctuate,
which could adversely affect the value of our Class A common stock.
REITs are required to distribute annually at least 90% of their REIT taxable income (determined before the deduction for
dividends paid and excluding any net capital gain). We may use our NOLs to offset our REIT taxable income, and thus any required
distributions to shareholders may be reduced or eliminated until such time as the NOLs have been fully utilized, which may adversely
affect the market value of our Class A common stock. The Code places limitations upon the future availability of NOLs based upon
changes in our equity. If these occur, our ability to offset future income with existing NOLs may be limited.
The amount of future distributions will be determined, from time to time, by our Board of Directors to balance our goal of
increasing long-term shareholder value and retaining sufficient cash to implement our current capital allocation policy, which
prioritizes investment in quality assets that meet our return criteria, and then stock repurchases, when we believe our stock price is
below its intrinsic value. The actual timing and amount of distributions will be as determined and declared by our Board of Directors
and will depend on, among other factors, our NOLs, our financial condition, earnings, debt covenants, and other possible uses of such
funds. Consequently, our future distribution levels may fluctuate.
Certain of our business activities may be subject to corporate level income tax and foreign taxes, which would reduce our cash
flows, and would have potential deferred and contingent tax liabilities.
We may be subject to certain federal, state, local, and foreign taxes on our income and assets, including alternative minimum
taxes, taxes on any undistributed income, and state, local, or foreign income, franchise, property, and transfer taxes. In addition, we
could be required, in certain circumstances, to pay an excise or penalty tax, which could be significant in amount, in order to utilize
one or more relief provisions under the Code to maintain qualification for taxation as a REIT. In addition, we may incur a 100%
excise tax on transactions with a TRS if they are not conducted at an arm’s length basis. Any of these taxes would decrease our
earnings and our available cash.
Our TRS assets and operations also will continue to be subject, as applicable, to federal and state corporate income taxes and
to foreign taxes in the jurisdictions in which those assets and operations are located. Any of these taxes would decrease our earnings
and our available cash.
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Risks Related to Ownership of our Class A Common Stock
The REIT-related ownership and transfer restrictions may restrict or prevent our shareholders from engaging in certain transfers
of our common stock.
In order for us to satisfy the requirements for REIT qualification, no more than 50% in value of all classes or series of our
outstanding shares of stock may be owned, beneficially or constructively, by 5 or fewer individuals (as defined in the Code to include
certain entities) at any time during the last half of each taxable year (other than the first year for which an election to be subject to tax
as a REIT has been made). In addition, our capital stock must be beneficially owned by 100 or more persons during at least 335 days
of a taxable year of 12 months or during a proportionate part of a shorter taxable year (other than the first year for which an election to
be taxed as a REIT has been made). Our articles of incorporation contain REIT-related ownership and transfer restrictions that
generally restrict shareholders from owning more than 9.8%, by value or number of shares, whichever is more restrictive, of our
outstanding shares of Class A common stock, or 9.8% in aggregate value of the outstanding shares of all classes and series of our
capital stock. Under applicable constructive ownership rules, any shares of stock owned by certain affiliated owners generally would
be added together for purposes of the ownership limits. These ownership and transfer restrictions could have the effect of delaying,
deferring, or preventing a transaction or a change in control that might involve a premium price for our capital stock or otherwise be in
the best interest of our shareholders.
Our articles of incorporation, our bylaws and Florida law provide for anti-takeover provisions that could make it more difficult for
a third party to acquire us.
Provisions of our articles of incorporation, our bylaws and Florida law could make it more difficult for a third party to
acquire us, even if doing so would be beneficial to our shareholders. These provisions, alone or in combination with each other, may
discourage transactions involving actual or potential changes of control, including transactions that otherwise could involve payment
of a premium over prevailing market prices to holders of our Class A common stock, or could limit the ability of our shareholders to
approve transactions that they may deem to be in their best interests.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 1C. CYBERSECURITY
Risk Management & Strategy
A cybersecurity threat is any potential unauthorized occurrence, on or conducted through, our information systems that may
result in adverse effects on the confidentiality, integrity or availability of our information systems or any information residing therein.
We have a comprehensive, cross-functional approach to cybersecurity risk management, driven by our information security
management systems and propelled by industry-leading expertise from both our internal information technology security team and
top-tier third-party consultants and firms that we engage. Our cyber risk management process is supported by both management and
our Board of Directors.
Our cybersecurity risk management strategies represent an integral component of our overall approach to enterprise risk
management (“ERM”). Our cybersecurity policies, standards, processes, and practices are fully integrated into our ERM program and
based on the recognized National Institute of Standards and Technology (NIST) Cybersecurity Framework. We continuously seek to
adopt market-leading standards and procedures to protect our tower infrastructure, data, and carrier, vendor, and consumer
information. Key elements of our cybersecurity risk management strategy include:
(1) System Monitoring and Testing. We work collaboratively with third-party industry experts and consultants to
conduct regular vulnerability assessments and penetration testing from both outside and within our system networks. Our information
security team utilizes endpoint software together with technology platforms and applications designed to enable it to monitor user and
network behavior and origination points in real time both at our corporate headquarters as well as any of our sites globally. In addition,
we conduct quarterly phishing campaign simulations which include notification of the respective Executive Vice President in the
event of a failure by an employee in their department.
(2) Threat Identification & Response. Our internal information security team works collaboratively with our external
industry consultants to identify threats utilizing analytics and metrics, which are aligned with the MITRE ATT&CK (Adversarial
Tactics, Techniques, and Common Knowledge) Framework, and mitigate attacks across various layers of our enterprise systems. We
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leverage the core functions of the NIST Cybersecurity Framework (Identify, Protect, Detect, Respond, and Recover) to constantly
work toward identifying opportunities for further improvement and development of our risk mitigation strategies. We also build upon
the principles of the ISO 27001 standard and have achieved ISO 27001:2013 certification for one of our data centers. As part of our
response preparedness, our executive management team participates in comprehensive tabletop exercises annually simulating
cybersecurity breaches or other incidents which simulate identifying, responding and reporting of such an incident in accordance with
our risk management programs.
(3) Defense Procedures & Preparedness. We have established and maintain a data incident response and a business
continuity management plan to timely, consistently, and appropriately address cyber threats that may occur despite our safeguards.
The response plan is global in scope and covers the major phases of the incident response process, including preparation, detection and
analysis, containment and investigation, notification (which may include timely notice to our Board if deemed material or
appropriate), eradication and recovery, and incident closure and post-incident analysis. Our response plan is reviewed annually,
regularly tested, and updated based on developments in the industry. Our business continuity management system includes targets and
objectives, impact analyses and risk assessments, exercise and testing, training and awareness, documentation and standards for data
centers and servers.
(4) Outside Consultants & Industry Experts. In addition to the broad capabilities of our internal information security
team, we also engage various outside consultants, including contractors, security firms, auditors, and other third-party subject matter
experts, to among other things, conduct regular testing of our networks and systems to identify vulnerabilities through penetration
testing, while also measuring and advising on potential improvements to our cybersecurity programs. We are also members of
recognized global industry organizations such as the Information Systems Audit and Control Association (ISACA), International
Information System Security Certification Consortium (ISC), and International Association of Privacy Professionals (IAPP).
(5) Third-Party Risk Assessments. We maintain a comprehensive risk-based approach to identifying and overseeing
potential cybersecurity risks presented by third parties, including our vendors and service providers. We have a dedicated information
technology vendor management team that reports to our Chief Information Officer (“CIO”). We conduct initial and regular
cybersecurity assessments of third-party vendors that we engage with in our operations and their information security policies and
systems in order to identify, evaluate, and address potential vulnerabilities.
(6) Team Member Education & Awareness. We remain dedicated to fostering an internal culture of cybersecurity,
where all of our team members are trained to identify, respond, and report potential cybersecurity threats that may arise. New hires are
required to participate in cybersecurity onboarding training, and current employees are responsible for completing mandatory
cybersecurity training annually and phishing awareness training quarterly. Our leadership team participates in advanced, targeted
cybersecurity training and exercises to ensure additional security. Our leadership team also participates in table-top exercises and
trainings tailored to specific business units. For example, most recently our internal audit and finance teams participated in a
successful table-top exercise which simulated cyber-attacks on our payroll and financial systems. All of our table-top exercises are
facilitated by a third-party.
As part of our cybersecurity risk management strategy, each cyber threat is evaluated for materiality and escalated based
upon evaluation of the potential severity and risk impact on our operations. We have not experienced a material cybersecurity breach
in the past three years. As such, we have not incurred any material expenses from cybersecurity breaches or any expenses from
penalties or settlements related to a cybersecurity breach during that time. For more information regarding cybersecurity-related risks
that could materially affect our business strategies, results of operations, or financial condition, please see Item 1A in this Form 10-K
under the headings “Information technology disruptions, including as a result of cybersecurity breaches, could compromise our
information, which would cause our business and reputation to suffer.”
Governance & Personnel
Our Board believes a robust cybersecurity strategy is vital to protect our business, customers, and assets. The Board has
delegated to the Audit Committee responsibility for oversight and review of our cybersecurity and other information technology and
data privacy risk management program, controls, strategies, and procedures. The Audit Committee periodically evaluates our
cybersecurity strategies to ensure effectiveness and, if appropriate, includes a review from third-party experts. In addition, our Board
also may review and assess cybersecurity risks as part of its responsibilities for general risk oversight. Additionally, the Audit
Committee has established a subcommittee to evaluate cybersecurity incidents, if any, and determine the Company’s disclosure
obligations in light of such incidents.
Our CIO reports to the Audit Committee at every regularly scheduled meeting (or more frequently, as needed) to discuss
cybersecurity risk exposure and risk management strategy. Our CIO has over 25 years of experience in the information technology and
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security industry with global organizations. Our executive leadership team, which includes our CIO, reviews and manages
implementation of our cybersecurity strategy and programs through regularly scheduled meetings.
Our information security team, led by our CIO and Senior Director, IT Security and Compliance, has over 75 years of
collective cybersecurity experience and maintains numerous active industry-recognized cyber certifications, such as Certified
Information Security Manager (CISM), Certified Information Systems Security Professional (CISSP), and Certified Information
Systems Auditor (CISA). Our information security team undertakes a variety of measures in the daily monitoring and management of
cybersecurity risks across our business. For example, the information security team monitors our technology infrastructure with tools
designed to detect suspicious behavior and decrypt VPN traffic on our systems globally. The information security team conducts
regular internal and external audits with third-party cybersecurity experts to identify and evaluate potential weaknesses in its
cybersecurity systems. Some of these third-party monitoring functions continue throughout the year while other third-party security
experts are periodically retained to audit specific areas of our cybersecurity program. In addition, our information security team works
with our internal audit function to monitor reporting and escalation of cybersecurity incident reports from across our business. Our
information security team also works with our Executive Vice President, Chief Administrative Officer and General Counsel on our
data privacy program, including with respect to the preservation and protection of the integrity and confidentiality of our data and
systems.
ITEM 2. PROPERTIES
We own our headquarters in Boca Raton, Florida where we currently have approximately 160,000 square feet of office space.
We also own or have entered into long-term leases for international and regional locations convenient for the management and
operation of our site leasing activities, and in certain site development office locations where we expect our activities to be longer-
term. We believe our existing facilities are adequate for our current and planned levels of operations and that additional office space
suited for our needs is reasonably available in the markets within which we operate.
Our interests in towers and the land beneath them are comprised of a variety of fee interests, leasehold interests created by
long-term lease agreements, perpetual easements, easements, licenses, rights-of-way, right-of-use, and other similar interests. As of
December 31, 2024, approximately 72% of our tower structures were located on parcels of land that we own, land subject to perpetual
easements, or parcels of land that have an interest that extends beyond 20 years. The average remaining life under our ground leases
and other property interests, including renewal options under our control, is 36 years. In rural areas, support for our towers, equipment
shelters, and related equipment requires a tract of land typically up to 10,000 square feet. Less than 2,500 square feet is required for a
monopole or self-supporting tower of the kind typically used in metropolitan areas for wireless communications towers. Ground leases
and other property interests are generally for an initial term of five years or more with multiple renewal periods, for a total of 30 years
or more.
Most of our towers have significant capacity available for additional antennas. We measure the available capacity of our
existing facilities to support additional tenants and generate additional lease revenue by assessing several factors, including tower
height, tower type, wind loading, environmental conditions, existing equipment on the tower and zoning and permitting regulations in
effect in the jurisdiction where the tower is located. As of December 31, 2024, we had an average of 1.9 tenants per site.
ITEM 3. LEGAL PROCEEDINGS
We are involved in various legal proceedings relating to claims arising in the ordinary course of business. We do not believe
that the ultimate resolution of these matters will have a material adverse effect on our business, financial condition, results of
operations, or liquidity.
ITEM 4. MINE SAFETY DISCLOSURE
Not Applicable.
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PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
Market for our Class A Common Stock
Our Class A common stock commenced trading under the symbol “SBAC” on The NASDAQ National Market System on
June 16, 1999. We trade on the NASDAQ Global Select Market, a segment of the NASDAQ Global Market.
As of February 14, 2025, there were 270 record holders of our Class A common stock.
Dividends
As a REIT, we are required to distribute annually at least 90% of our REIT taxable income after the utilization of any
available NOLs (determined before the deduction for dividends paid and excluding any net capital gain). As of December 31, 2024,
$337.7 million of the federal NOLs are attributes of the REIT. We may use these NOLs to offset our REIT taxable income, and thus
any required distributions to shareholders may be reduced or eliminated until such time as our NOLs have been fully utilized or
expired. The amount of future distributions will be determined, from time to time, by our Board of Directors to balance our goal of
increasing long-term shareholder value and retaining sufficient cash to implement our current capital allocation policy, which
prioritizes investment in quality assets that meet our return criteria, and then stock repurchases when we believe our stock price is
below its intrinsic value. The actual amount, timing, and frequency of future dividends, will be at the sole discretion of our Board of
Directors and will be declared based upon various factors, many of which are beyond our control.
ITEM 6. RESERVED
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
The following discussion of our financial condition and results of operations should be read in conjunction with the
information contained in our consolidated financial statements and the notes thereto. The following discussion includes forward-
looking statements that involve certain risks and uncertainties, including, but not limited to, those described in Item 1A. Risk Factors.
Our actual results may differ materially from those discussed below. See “Special Note Regarding Forward-Looking Statements” and
Item 1A. Risk Factors.
We are a leading independent owner and operator of wireless communications infrastructure, including tower structures,
rooftops, and other structures that support antennas used for wireless communications, which we collectively refer to as “towers” or
“sites.” Our principal operations are in the United States and its territories. In addition, we own and operate towers in South America,
Central America, Canada, and Africa. On January 10, 2025, we sold all of our towers and ended our operations in the Philippines and
on February 20, 2025, we entered into an agreement to sell all of our towers and related assets held in Colombia. Our primary business
line is our site leasing business, which contributed 98.4% of our total segment operating profit for the year ended December 31, 2024.
In our site leasing business, we (1) lease space to wireless service providers and other customers on assets that we own or operate and
(2) manage rooftop and tower sites for property owners under various contractual arrangements. As of December 31, 2024, we owned
39,749 towers, a substantial portion of which have been built by us or built by other tower owners or operators who, like us, have built
such towers to lease space to multiple wireless service providers. Our other business line is our site development business, through
which we assist wireless service providers in developing and maintaining their own wireless service networks.
Site Leasing
Our primary focus is the leasing of antenna space on our multi-tenant towers to a variety of wireless service providers under
long-term lease contracts in the United States, South America, Central America, Canada, and Africa. As of December 31, 2024, no
U.S. state or territory accounted for more than 10% of our total tower portfolio by tower count, and no U.S. state or territory accounted
for more than 10% of our total revenues for the year ended December 31, 2024. In addition, as of December 31, 2024, approximately
30% of our total towers are located in Brazil and no other international market (each country is considered a market) represented more
than 5% of our total towers.
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We derive site leasing revenues primarily from wireless service provider tenants. Wireless service providers enter into either
(1) standalone individual tenant site leases with us, each of which relates to the lease or use of space at an individual site, or (2) master
lease agreements (“MLA”) with us, which provide for the material terms and conditions that will apply to multiple sites; although, in
most cases, each individual site under a MLA is also governed by its own site leasing agreement which sets forth pricing and other site
specific terms. Our tenant leases are generally for an initial term of five years to fifteen years with multiple renewal periods at the
option of the tenant. Our tenant leases typically either (1) contain specific annual rent escalators, (2) escalate annually in accordance
with an inflationary index, or (3) escalate using a combination of fixed and inflation adjusted escalators. In addition, our international
site leases may include pass-through charges, such as rent related to ground leases and other property interests, utilities, property
taxes, and fuel.
Cost of site leasing revenue primarily consists of:
• Cash and non-cash rental expense on ground leases, right-of-use, and other underlying property interests;
• Property taxes;
• Site maintenance and monitoring costs (exclusive of employee related costs);
• Utilities;
• Property insurance;
• Fuel (in those international markets that do not have an available electric grid at our tower sites); and
• Lease initial direct cost amortization.
Ground leases and other property interests are generally for an initial term of five years or more with multiple renewal
periods, which are at our option. Our ground leases either (1) contain specific annual rent escalators, or (2) escalate annually in
accordance with an inflationary index. As of December 31, 2024, approximately 72% of our tower structures were located on parcels
of land that we own, land subject to perpetual easements, or parcels of land in which we have a leasehold interest that extends beyond
20 years. For any given tower, costs are relatively fixed over a monthly or an annual time period. As such, operating costs for owned
towers do not generally increase as a result of adding additional customers to the tower. The amount of property taxes varies from site
to site depending on the taxing jurisdiction and the height and age of the tower. The ongoing maintenance requirements are typically
minimal and include replacing lighting systems, painting a tower, or upgrading or repairing an access road or fencing.
In Ecuador, El Salvador, Guatemala, Nicaragua, and Panama, significantly all of our revenue, expenses, and capital
expenditures arising from our activities are denominated in U.S. dollars. Specifically, most of our ground leases and other property
interests, tenant leases, and tower-related expenses are paid in U.S. dollars. In most of our Central American markets, our local
currency obligations are principally limited to (1) permitting and other local fees, (2) utilities, and (3) taxes. In Brazil, Canada, Chile,
and South Africa, significantly all of our revenue, expenses, and capital expenditures, including tenant leases, ground leases and other
property interests, and other tower-related expenses are denominated in local currency. In Colombia, Costa Rica, Peru, and Tanzania,
our revenue, expenses, and capital expenditures, including tenant leases, ground leases and other property interests, and other tower-
related expenses are denominated in a mix of local currency and U.S. dollars.
As indicated in the table below, our site leasing business generates substantially all of our total segment operating profit. For
information regarding our operating segments, see Note 15 of our Consolidated Financial Statements included in this annual report.
For the year ended
Segment operating profit as a percentage of
December 31,
total operating profit
2024
2023
2022
Domestic site leasing
75.9%
75.2%
77.0%
International site leasing
22.5%
22.2%
19.2%
Total site leasing
98.4%
97.4%
96.2%
We believe that the site leasing business continues to be attractive due to its long-term contracts, built-in rent escalators, high
operating margins, and low customer churn (which refers to a lease that is non-renewed, cancelled, or discounted prior to the end of its
term) other than in connection with customer consolidation or cessations of specific technology. We believe that over the long-term,
site leasing revenues will continue to grow as wireless service providers lease additional antenna space on our towers due to increasing
minutes of network use and data transfer, network expansion, and network coverage requirements.
During 2025, we expect core leasing revenue in both our domestic and international segments to increase over 2024 levels,
on a currency neutral basis, due in part to wireless carriers deploying unused spectrum, the full year impact of towers acquired and
built during 2024, and the revenues from towers expected to be acquired and built during 2025. We believe our site leasing business is
characterized by stable and long-term recurring revenues, predictable operating costs, and minimal non-discretionary capital
expenditures. Due to the nature and mix of our tower portfolio, we expect future expenditures required to maintain these towers to be
minimal. Consequently, we expect to grow our cash flows by (1) adding tenants to our towers at minimal incremental costs by using
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existing tower capacity or requiring wireless service providers to bear all or a portion of the cost of tower modifications and
(2) executing monetary amendments as wireless service providers add or upgrade their equipment. Furthermore, because our towers
are strategically positioned, we have historically experienced low tenant lease terminations as a percentage of revenue other than in
connection with customer consolidation or cessations of a specific technology.
Site Development
Our site development business, which is conducted in the United States only, is complementary to our site leasing business
and provides us the ability to keep in close contact with the wireless service providers who generate substantially all of our site leasing
revenue and to capture ancillary revenues that are generated by our site leasing activities, such as antenna and equipment installation
at our tower locations. Site development revenues are earned primarily from providing a full range of end-to-end services to wireless
service providers or companies providing development or project management services to wireless service providers. Our services
include: (1) network pre-design; (2) site audits; (3) identification of potential locations for towers and antennas on existing
infrastructure; (4) support in leasing of the location; (5) assistance in obtaining zoning approvals and permits; (6) tower and related
site construction; (7) antenna installation; and (8) radio equipment installation, commissioning, and maintenance. We provide site
development services at our towers and at towers owned by others on a local basis, through regional, market, and project offices. The
market offices are responsible for all site development operations.
For information regarding our operating segments, see Note 15 of our Consolidated Financial Statements in this annual
report.
Capital Allocation Strategy
Our capital allocation strategy is aimed at increasing shareholder value through investment in quality assets that meet our
return criteria, stock repurchases when we believe our stock price is below its intrinsic value, and by returning cash generated by our
operations in the form of cash dividends. In addition, in a high interest rate environment and when we believe interest rates may stay
higher for longer, we believe that debt repayments, especially of our variable rate debt, may be an accretive use of our excess capital.
While the addition of cash dividends and debt repayments have provided us with additional tools to return value to our shareholders,
we continue to believe that our priority is to make investments focused on increasing Adjusted Funds From Operations per share. Key
elements of our capital allocation strategy include:
Portfolio Growth. We intend to continue to grow our asset portfolio, domestically and internationally, primarily through
tower acquisitions and the construction of new towers that meet our internal return on invested capital criteria.
Stock Repurchase Program. We currently utilize stock repurchases as part of our capital allocation policy when we believe
our share price is below its intrinsic value. We believe that share repurchases, when purchased at the right price, will facilitate our goal
of increasing our Adjusted Funds From Operations per share.
Dividend. Cash dividends are an additional component of our strategy of returning value to shareholders. We do not expect
our dividend to require any changes in our leverage and believe that, due to our low dividend payout ratio, we can continue to focus on
building and buying quality assets and opportunistically buying back our stock. While the timing and amount of future dividends will
be subject to approval by our Board of Directors, we believe that our future cash flow generation will permit us to grow our cash
dividend in the future.
Critical Accounting Policies and Estimates
We have identified the policies and significant estimation processes below as critical to our business operations and the
understanding of our results of operations. The listing is not intended to be a comprehensive list. In many cases, the accounting
treatment of a particular transaction is specifically dictated by accounting principles generally accepted in the United States, with no
need for management’s judgment in their application. In other cases, management is required to exercise judgment in the application
of accounting principles with respect to particular transactions. The impact and any associated risks related to these policies on our
business operations is discussed throughout “Management’s Discussion and Analysis of Financial Condition and Results of
Operations” where such policies affect reported and expected financial results. For a detailed discussion on the application of these
and other accounting policies, see Note 2 of our Consolidated Financial Statements for the year ended December 31, 2024. Our
preparation of our financial statements requires us to make estimates and assumptions that affect the reported amount of assets and
liabilities, disclosure of contingent assets and liabilities at the date of our financial statements, and the reported amounts of revenue
and expenses during the reporting periods. Management bases its estimates on historical experience and on various other assumptions
27
that are believed to be reasonable under the circumstances. There can be no assurance that actual results will not differ from those
estimates and such differences could be significant.
During the first quarter of 2024, we completed our assessment on the remaining estimated useful lives of our towers and
intangible assets. We concluded through our assessment that, for U.S. GAAP purposes, we should modify our current estimates for
asset lives based on our historical operating experience and the findings obtained by our independent consultant. We previously
depreciated our towers on a straight-line basis over the shorter of the (i) term of the underlying ground lease (including renewal
options) taking into account residual value or (ii) estimated useful life of a tower, which we had historically estimated to be 15 years.
Based on our assessment, we revised the estimated useful lives of our towers and certain related intangible assets (which are amortized
on a similar basis to our tower assets, as their useful lives correlate to the useful life of the towers) from 15 years to 30 years, effective
January 1, 2024. We accounted for the change in estimated useful lives as a change in estimate under ASC 250 “Accounting Changes
and Error Corrections.” The impact of the change in estimate was accounted for prospectively effective January 1, 2024, resulting in a
reduction in depreciation and amortization expense of approximately $411.5 million ($372.5 million after tax, or an increase of $3.45
per diluted share) for the year ended December 31, 2024. There have been no other material changes to our significant accounting
policies during the year ended December 31, 2024.
Revenue Recognition and Accounts Receivable
Site leasing revenues
Revenue from site leasing is recognized on a straight-line basis over the current term of the related lease agreements, which
are generally five years to fifteen years. Receivables recorded related to the straight-lining of site leases are reflected in other assets on
the Consolidated Balance Sheets. Rental amounts received in advance are recorded as deferred revenue on the Consolidated Balance
Sheets. Revenue from site leasing represents 94% of our total revenue for the year ended December 31, 2024.
Site development revenues
Site development projects in which we perform consulting services include contracts on a fixed price basis that are billed at
contractual rates. Revenue is recognized over time based on milestones achieved, which are determined based on costs incurred.
Amounts billed in advance (collected or uncollected) are recorded as deferred revenue on our Consolidated Balance Sheets.
Revenue from construction projects is recognized over time, determined by the percentage of cost incurred to date compared
to management’s estimated total cost for each contract. This method is used because management considers total cost to be the best
available measure of progress on the contracts. These amounts are based on estimates, and the uncertainty inherent in the estimates
initially is reduced as work on the contracts nears completion. Refer to Note 5 in our Consolidated Financial Statements included in
this annual report for further detail of costs and estimated earnings in excess of billings on uncompleted contracts. Provisions for
estimated losses on uncompleted contracts are made in the period in which such losses are determined to be probable.
The site development segment represents approximately 6% of our total revenues for the year ended December 31, 2024. We
account for site development revenue in accordance with ASC 606, Revenue from Contracts with Customers. Payment terms do not
result in any significant financing arrangements. Furthermore, these contracts do not typically include variable consideration;
therefore, the transaction price that is recognized over time is generally the amount of the total contract.
Accounts receivable
The accounts receivable balance for the years ended December 31, 2024 and 2023 was $145.7 million and $182.7 million,
respectively, of which $26.4 million and $32.3 million related to the site development segment, respectively. We perform periodic
credit evaluations of our customers. In addition, we monitor collections and payments from our customers and maintain a provision
for estimated credit losses based upon historical experience, specific customer collection issues identified, and past due balances as
determined based on contractual terms. Interest is charged on outstanding receivables from customers on a case-by-case basis in
accordance with the terms of the respective contracts or agreements with those customers. Amounts determined to be uncollectible are
written off against the allowance for doubtful accounts in the period in which uncollectibility is determined to be probable. Refer to
Note 15 in our Consolidated Financial Statements included in this annual report for further detail of the site development segment.
Lease Accounting
ASC 842, Leases, requires all lessees to recognize a right-of-use asset and a lease liability, initially measured at the present
value of the lease payments. We have elected not to separate nonlease components from the associated lease component for all
28
underlying classes of assets. In order to calculate our lease liability, we make certain assumptions related to lease term and discount
rate. To determine the lease term, we consider all renewal periods that are reasonably certain to be exercised, taking into consideration
all economic factors, including the communications site’s estimated economic life and the respective lease terms of our tenants under
the existing lease arrangements on such site. For the discount rate, we use the rate implicit in the lease when available to discount
lease payments to present value. However, our ground leases and other property interests generally do not provide a readily
determinable implicit rate. Therefore, we estimate the incremental borrowing rate to discount lease payments based on the lease term
and lease currency. We use publicly available data for instruments with similar characteristics when calculating our incremental
borrowing rates. Refer to Note 2 in our Consolidated Financial Statements included in this annual report for further discussion on
lease accounting.
RESULTS OF OPERATIONS
This report presents our financial results and other financial metrics on a GAAP basis and, with respect to our international
and consolidated results, after eliminating the impact of changes in foreign currency exchange rates. We believe that providing these
financial results and metrics on a constant currency basis, which are non-GAAP measures, gives management and investors the ability
to evaluate the performance of our business without the impact of foreign currency exchange rate fluctuations. We eliminate the
impact of changes in foreign currency exchange rates by dividing the current period’s financial results by the average monthly
exchange rates of the prior year period, as well as by eliminating the impact of realized and unrealized gains and losses on our
intercompany loans.
Year Ended 2024 Compared to Year Ended 2023
Revenues and Segment Operating Profit:
For the year ended
Constant
December 31,
Foreign
Constant
Currency
2024
2023
Currency Impact
Currency Change
% Change
Revenues
(in thousands)
Domestic site leasing
$
1,861,424
$
1,846,554
$
—
$
14,870
0.8%
International site leasing
665,341
670,381
(37,553)
32,513
4.8%
Site development
152,869
194,649
—
(41,780)
(21.5%)
Total
$
2,679,634
$
2,711,584
$
(37,553)
$
5,603
0.2%
Cost of Revenues
Domestic site leasing
$
269,168
$
268,572
$
—
$
596
0.2%
International site leasing
193,829
204,115
(11,016)
730
0.4%
Site development
118,730
139,935
—
(21,205)
(15.2%)
Total
$
581,727
$
612,622
$
(11,016) $
(19,879)
(3.2%)
Operating Profit
Domestic site leasing
$
1,592,256
$
1,577,982
$
—
$
14,274
0.9%
International site leasing
471,512
466,266
(26,537)
31,783
6.8%
Site development
34,139
54,714
—
(20,575)
(37.6%)
Revenues
Domestic site leasing revenues increased $14.9 million for the year ended December 31, 2024, as compared to the prior year,
primarily due to (1) organic site leasing growth, primarily from monetary lease amendments (due in part to our 2023 MLA with
AT&T) and additional equipment added to our towers as well as new leases and contractual rent escalators and (2) revenues from 130
towers acquired and 39 towers built since January 1, 2023, partially offset by lease non-renewals.
International site leasing revenues decreased $5.0 million for the year ended December 31, 2024, as compared to the prior
year. On a constant currency basis, international site leasing revenues increased $32.5 million. These changes were primarily due to
(1) lease early termination fees, (2) organic site leasing growth from new leases, amendments, and contractual escalators, and (3)
revenues from 147 towers acquired and 783 towers built since January 1, 2023, partially offset by lease non-renewals and a decrease
in reimbursable pass-through expenses. Site leasing revenue in Brazil represented 15.0% of total site leasing revenue for the period.
No other individual international market represented more than 5% of our total site leasing revenue.
Site development revenues decreased $41.8 million for the year ended December 31, 2024, as compared to the prior year, as
a result of decreased carrier activity.
29
Operating Profit
Domestic site leasing segment operating profit increased $14.3 million for the year ended December 31, 2024, as compared
to the prior year, primarily due to higher domestic site leasing revenue as noted above, partially offset by the incremental costs
associated with towers acquired and built since January 1, 2023.
International site leasing segment operating profit increased $5.2 million for the year ended December 31, 2024, as compared
to the prior year. On a constant currency basis, international site leasing segment operating profit increased $31.8 million. These
changes were primarily due to higher international site leasing revenues as noted above, partially offset by the incremental costs
associated with towers acquired and built since January 1, 2023.
Site development segment operating profit decreased $20.6 million for the year ended December 31, 2024, as compared to
the prior year, as a result of decreased carrier activity.
Selling, General, and Administrative Expenses:
For the year ended
Constant
December 31,
Foreign
Constant
Currency
2024
2023
Currency Impact
Currency Change
% Change
(in thousands)
Domestic site leasing
$
132,627
$
121,782
$
—
$
10,845
8.9%
International site leasing
64,583
66,619
(2,974)
938
1.4%
Total site leasing
$
197,210
$
188,401
$
(2,974) $
11,783
6.3%
Site development
13,983
21,316
—
(7,333)
(34.4%)
Other
47,563
58,219
—
(10,656)
(18.3%)
Total
$
258,756
$
267,936
$
(2,974) $
(6,206)
(2.3%)
Selling, general, and administrative expenses decreased $9.2 million for the year ended December 31, 2024, as compared to
the prior year. On a constant currency basis, selling, general, and administrative expenses decreased $6.2 million. These changes were
driven primarily by a decrease in non-cash compensation expense as well as the $3.1 million Oi reserve recorded in 2023, partially
offset by an increase in personnel, and other support related costs.
Acquisition and New Business Initiatives Related Adjustments and Expenses:
For the year ended
Constant
December 31,
Foreign
Constant
Currency
2024
2023
Currency Impact
Currency Change
% Change
(in thousands)
Domestic site leasing
$
14,954
$
10,725
$
—
$
4,229
39.4%
International site leasing
10,992
10,946
(467)
513
4.7%
Total
$
25,946
$
21,671
$
(467) $
4,742
21.9%
Acquisition and new business initiatives related adjustments and expenses increased $4.3 million for the year ended
December 31, 2024, as compared to the prior year. On a constant currency basis, acquisition and new business initiatives related
adjustments and expenses increased $4.7 million for the year ended December 31, 2024. These changes were primarily as a result of
an increase in our third party acquisition and integration costs as well as higher new business initiative activity as compared to the
prior year.
30
Asset Impairment and Decommission Costs:
For the year ended
Constant
December 31,
Foreign
Constant
Currency
2024
2023
Currency Impact
Currency Change
% Change
(in thousands)
Domestic site leasing
$
49,777
$
138,699
$
—
$
(88,922)
(64.1%)
International site leasing
57,030
28,089
(3,762)
32,703
116.4%
Total site leasing
$
106,807
$
166,788
$
(3,762) $
(56,219)
(33.7%)
Site development
—
372
—
(372)
(100.0%)
Other
1,118
2,227
—
(1,109)
(49.8%)
Total
$
107,925
$
169,387
$
(3,762) $
(57,700)
(34.1%)
Domestic site leasing asset impairment and decommission costs decreased $88.9 million for the year ended December 31,
2024, as compared to the prior year. This change was primarily as a result of a decrease in impairment charges resulting from our
regular analysis of whether the future cash flows from certain towers are adequate to recover the carrying value of the investment in
those towers and a decrease in tower and equipment related decommission costs. The prior year included increased impairment
charges resulting from the planned abandonment of identified sites with minimal expectations of future economic benefit (primarily
from Sprint churn).
International site leasing asset impairment and decommission costs increased $28.9 million for the year ended December 31,
2024, as compared to the prior year. On a constant currency basis, international site leasing asset impairment and decommission costs
increased $32.7 million. These changes were primarily as a result of an increase in impairment charges resulting from our regular
analysis of whether the future cash flows from certain towers are adequate to recover the carrying value of the investment in those
towers and an increase in tower decommission costs.
Depreciation, Accretion, and Amortization Expenses:
For the year ended
Constant
December 31,
Foreign
Constant
Currency
2024
2023
Currency Impact
Currency Change
% Change
(in thousands)
Domestic site leasing
$
145,041
$
457,169
$
—
$
(312,128)
(68.3%)
International site leasing
113,549
248,758
(5,893)
(129,316)
(52.0%)
Total site leasing
$
258,590
$
705,927
$
(5,893)
$
(441,444)
(62.5%)
Site development
3,560
3,704
—
(144)
(3.9%)
Other
7,367
6,678
—
689
10.3%
Total
$
269,517
$
716,309
$
(5,893)
$
(440,899)
(61.6%)
Depreciation, accretion, and amortization expense decreased $446.8 million for the year ended December 31, 2024, as
compared to the prior year. On a constant currency basis, depreciation, accretion, and amortization expense decreased $440.9 million.
These changes were primarily due to the change in estimated useful lives of our towers and certain related intangible assets from our
historical estimate of 15 years to a revised estimate of 30 years (effective January 1, 2024) and the impact of assets that became fully
depreciated since the prior year period, partially offset by an increase in the number of towers we acquired and built since January 1,
2023.
31
Operating Income (Expense):
For the year ended
Constant
December 31,
Foreign
Constant
Currency
2024
2023
Currency Impact
Currency Change
% Change
(in thousands)
Domestic site leasing
$
1,249,857
$
849,607
$
—
$
400,250
47.1%
International site leasing
225,358
111,854
(13,441)
126,945
113.5%
Total site leasing
$
1,475,215
$
961,461
$
(13,441)
$
527,195
54.8%
Site development
16,596
29,322
—
(12,726)
(43.4%)
Other
(56,048)
(67,124)
—
11,076
(16.5%)
Total
$
1,435,763
$
923,659
$
(13,441)
$
525,545
56.9%
Domestic site leasing operating income increased $400.3 million for the year ended December 31, 2024, as compared to the
prior year, primarily due to decreases in depreciation, accretion, and amortization expense and asset impairment and decommission
costs and higher segment operating profit, partially offset by increases in selling, general, and administrative expenses and acquisition
and new business initiatives related adjustments and expenses.
International site leasing operating income increased $113.5 million for the year ended December 31, 2024, as compared to
the prior year. On a constant currency basis, international site leasing operating income increased $126.9 million. These changes were
primarily due to a decrease in depreciation, accretion, and amortization expense and higher segment operating profit, partially offset
by an increase in asset impairment and decommission costs.
Site development operating income decreased $12.7 million for the year ended December 31, 2024, as compared to the prior
year, primarily due to lower segment operating profit driven by less carrier activity, partially offset by a decrease in selling, general,
and administrative expenses.
Other operating expense decreased $11.1 million for the year ended December 31, 2024, as compared to the prior year,
primarily due to decreases in selling, general, and administrative expenses and asset impairment and decommission costs.
Other Income (Expense):
For the year ended
Constant
December 31,
Foreign
Constant
Currency
2024
2023
Currency Impact
Currency Change
% Change
(in thousands)
Interest income
$
41,962
$
18,305
$
(515) $
24,172
132.1%
Interest expense
(399,778)
(400,373)
282
313
(0.1%)
Non-cash interest expense
(27,661)
(35,868)
(1)
8,208
(22.9%)
Amortization of deferred financing fees
(21,265)
(20,273)
—
(992)
4.9%
Loss from extinguishment of debt, net
(5,940)
—
—
(5,940)
—%
Other (expense) income, net
(250,415)
63,053
(320,596)
7,128
(52.2%)
Total
$
(663,097) $
(375,156) $
(320,830) $
32,889
(7.3%)
Interest income increased $23.7 million for the year ended December 31, 2024, as compared to the prior year. On a constant
currency basis, interest income increased $24.2 million. These changes were primarily due to a higher amount of interest-bearing
deposits held and a higher effective interest rate on those deposits as compared to the prior year, as well as interest received on a loan
to an unconsolidated joint venture.
Interest expense decreased $0.6 million for the year ended December 31, 2024, as compared to the prior year. On a constant
currency basis, interest expense decreased $0.3 million. These changes were primarily due to a lower average principal amount of
variable rate cash-interest bearing debt, partially offset by a higher interest rate on said variable debt as compared to the prior year, as
well as a higher average principal amount of fixed rate cash-interest bearing debt accruing interest at a higher weighted-average
interest rate.
Non-cash interest expense decreased $8.2 million for the year ended December 31, 2024, as compared to the prior year. This
change was primarily due to lower amortization of accumulated losses related to our interest rate swaps de-designated as cash flow
hedges which reached their term end date in 2023.
32
Loss from extinguishment of debt, net was $5.9 million for the year ended December 31, 2024 which primarily represents the
write-off of $3.3 million of unamortized financing fees and $1.2 million of the original issuance discount associated with the
repayment of the 2018 Term Loan in January 2024.
Other (expense) income, net includes a $236.5 million loss on the remeasurement of U.S. dollar denominated intercompany
loans with foreign subsidiaries for the year ended December 31, 2024, while the prior year period included an $81.2 million gain on
the remeasurement of U.S. dollar denominated intercompany loans with foreign subsidiaries and a $7.6 million loss on the sale of
tower assets.
Provision for Income Taxes:
For the year ended
Constant
December 31,
Foreign
Constant
Currency
2024
2023
Currency Impact
Currency Change
% Change
(in thousands)
Provision for income taxes
$
(23,989) $
(51,088) $
112,443 $
(85,344)
363.4%
Provision for income taxes decreased $27.1 million for the year ended December 31, 2024, as compared to the prior year. On
a constant currency basis, provision for income taxes increased $85.3 million. These changes were primarily due to an increase in
deferred taxes primarily due to the release of the valuation allowance on the domestic TRS in the prior year, partially offset by a
decrease in current taxes.
Net Income:
For the year ended
Constant
December 31,
Foreign
Constant
Currency
2024
2023
Currency Impact
Currency Change
% Change
(in thousands)
Net income
$
748,677
$
497,415
$
(221,828)
$
473,090
105.5%
Net income increased $251.3 million for the year ended December 31, 2024, as compared to the prior year. On a constant
currency basis, net income increased $473.1 million. These changes were primarily due to increases in site leasing operating income
(inclusive of a $372.5 million benefit related to our revision of the estimated useful lives of our towers and certain related intangible
assets), interest income, and other (expense) income, net, and a decrease in non-cash interest expense, partially offset by increases in
provision for income taxes and loss from extinguishment of debt, net and a decrease in site development operating income.
Year Ended 2023 Compared to Year Ended 2022
For a discussion of our 2023 Results of Operations, including a discussion of our financial results for the fiscal year ended
December 31, 2023 compared to the fiscal year ended December 31, 2022, refer to Part I, Item 7 of our annual report on Form 10-K
filed with the SEC on February 28, 2024.
NON-GAAP FINANCIAL MEASURES
This report contains information regarding Adjusted EBITDA, a non-GAAP measure. We have provided below a description
of Adjusted EBITDA, a reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure and an explanation as to
why management utilizes this measure. This report also presents our financial results and other financial metrics after eliminating the
impact of changes in foreign currency exchange rates. We believe that providing these financial results and metrics on a constant
currency basis, which are non-GAAP measures, gives management and investors the ability to evaluate the performance of our
business without the impact of foreign currency exchange rate fluctuations. We eliminate the impact of changes in foreign currency
exchange rates by dividing the current period’s financial results by the average monthly exchange rates of the prior year period, as
well as by eliminating the impact of the remeasurement of our intercompany loans.
Adjusted EBITDA
We define Adjusted EBITDA as net income excluding the impact of non-cash straight-line leasing revenue, non-cash
straight-line ground lease expense, non-cash compensation, net loss from extinguishment of debt, other income and expenses,
acquisition and new business initiatives related adjustments and expenses, asset impairment and decommission costs, interest income,
interest expenses, depreciation, accretion, and amortization, and income taxes.
33
We believe that Adjusted EBITDA is useful to investors or other interested parties in evaluating our financial performance.
Adjusted EBITDA is the primary measure used by management (1) to evaluate the economic productivity of our operations and (2) for
purposes of making decisions about allocating resources to, and assessing the performance of, our operations. Management believes
that Adjusted EBITDA helps investors or other interested parties to meaningfully evaluate and compare the results of our operations
(1) from period to period and (2) to our competitors, by excluding the impact of our capital structure (primarily interest charges from
our outstanding debt) and asset base (primarily depreciation, amortization, and accretion) from our financial results. Management also
believes Adjusted EBITDA is frequently used by investors or other interested parties in the evaluation of REITs. In addition, Adjusted
EBITDA is similar to the measure of current financial performance generally used by our lenders to determine compliance with
certain covenants under our Senior Credit Agreement and the indentures relating to the 2020 Senior Notes and 2021 Senior Notes.
Adjusted EBITDA should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our
performance.
For the year ended
Constant
December 31,
Foreign
Constant
Currency
2024
2023
Currency Impact
Currency Change
% Change
(in thousands)
Net income
$
748,677
$
497,415
$
(221,828) $
473,090
105.5%
Non-cash straight-line leasing revenue
(10,851)
(25,206)
(160)
14,515
(57.6%)
Non-cash straight-line ground lease expense
(7,668)
(686)
(201)
(6,781)
988.5%
Non-cash compensation
74,374
87,919
(521)
(13,024)
(14.8%)
Loss from extinguishment of debt, net
5,940
—
—
5,940
—%
Other expense (income), net
250,415
(63,053)
320,596
(7,128)
52.2%
Acquisition and new business initiatives
related adjustments and expenses
25,946
21,671
(467)
4,742
21.9%
Asset impairment and decommission costs
107,925
169,387
(3,762)
(57,700)
(34.1%)
Interest income
(41,962)
(18,305)
515
(24,172)
132.1%
Interest expense (1)
448,704
456,514
(281)
(7,529)
(1.6%)
Depreciation, accretion, and amortization
269,517
716,309
(5,893)
(440,899)
(61.6%)
Provision for income taxes (2)
23,328
51,885
(112,444)
83,887
345.5%
Adjusted EBITDA
$
1,894,345
$
1,893,850
$
(24,446) $
24,941
1.3%
(1)
Total interest expense includes interest expense, non-cash interest expense, and amortization of deferred financing fees.
(2)
Provision for income taxes includes a $0.7 million benefit from franchise and gross receipts taxes for the year ended
December 31, 2024 and $0.8 million of franchise taxes for the year ended December 31, 2023 reflected in selling, general,
and administrative expenses on the Consolidated Statement of Operations.
Adjusted EBITDA increased $0.5 million for the year ended December 31, 2024, as compared to the prior year. On a
constant currency basis, Adjusted EBITDA increased $24.9 million. These changes were primarily due to an increase in site leasing
segment operating profit, partially offset by a decrease in site development segment operating profit and an increase in cash selling,
general, and administrative expenses.
LIQUIDITY AND CAPITAL RESOURCES
SBAC is a holding company with no business operations of its own. SBAC’s only significant asset is 100% of the
outstanding capital stock of SBA Telecommunications, LLC (“Telecommunications”), which is also a holding company that owns
equity interests in entities that directly or indirectly own all of our domestic and international towers and assets. We conduct all of our
business operations through Telecommunications’ subsidiaries. Accordingly, our only source of cash to pay our obligations, other than
financings, is distributions with respect to our ownership interest in our subsidiaries from the net earnings and cash flow generated by
these subsidiaries.
34
A summary of our cash flows is as follows:
For the year ended December 31,
2024
2023
(in thousands)
Cash provided by operating activities
$
1,334,866
$
1,544,393
Cash used in investing activities
(809,310)
(468,246)
Cash provided by (used in) financing activities
645,742
(1,017,218)
Change in cash, cash equivalents, and restricted cash
1,171,298
58,929
Effect of exchange rate changes on cash, cash equiv., and restricted cash
(21,587)
2,734
Cash, cash equivalents, and restricted cash, beginning of year
250,946
189,283
Cash, cash equivalents, and restricted cash, end of year
$
1,400,657
$
250,946
Operating Activities
Cash provided by operating activities was $1.3 billion for the year ended December 31, 2024 as compared to $1.5 billion for
the year ended December 31, 2023. The decrease was primarily due to an increase in cash outflows associated with working capital
changes related to the timing of customer payments and increases in cash selling, general, and administrative expenses and cash asset
impairment and decommission costs as well as a decrease in site development segment operating profit, partially offset by increases in
site leasing segment operating profit and interest income.
Investing Activities
A detail of our cash capital expenditures is as follows:
For the year ended
December 31,
2024
2023
(in thousands)
Acquisitions of towers and related assets
$
(243,635)
$
(86,686)
Land buyouts and other assets (1)
(56,176)
(43,275)
Construction and related costs
(119,853)
(98,128)
Augmentation and tower upgrades
(53,554)
(82,493)
Tower maintenance
(49,210)
(50,463)
General corporate
(5,532)
(5,614)
Other investing activities (2)(3)
(281,350)
(101,587)
Net cash used in investing activities
$
(809,310)
$
(468,246)
(1)
Excludes $24.9 million and $17.6 million spent to extend ground lease terms for the years ended December 31, 2024 and
2023, respectively. We recorded these amounts in prepaid expenses and other assets within the changes in operating assets
and liabilities, net of acquisitions section of our Consolidated Statements of Cash Flows.
(2)
Includes amounts paid for the purchase of and received from the sale of short-term investments during the years ended
December 31, 2024 and 2023.
(3)
Includes $11.1 million and $100.5 million of loans to an unconsolidated joint venture for the years ended December 31, 2024
and 2023, respectively.
During the fourth quarter of 2024, we entered into an agreement to purchase over 7,000 communication sites in Central
America from Millicom International Cellular S.A. (“Millicom”) for approximately $975.0 million in cash. These sites are located in
Guatemala, Honduras, Panama, El Salvador, and Nicaragua, with significantly all cash flows denominated in USD. Upon closing,
Millicom will enter into country-specific MLAs to lease back space on all acquired sites for an initial term of 15 years. The MLAs will
also incorporate an extension to our approximately 1,500 existing site leases with Millicom for a new 15-year term. Additionally, as
part of the purchase agreement, we have agreed to a seven-year exclusivity right with Millicom for us to build up to 2,500 build-to-suit
sites in Central America for Millicom with new leases on any sites built having an initial lease term of 15 years. This transaction has
an estimated closing date of September 1, 2025; however, the ultimate closing is dependent upon regulatory approvals and other
requirements and may differ from this date.
35
In addition to the Millicom transaction, subsequent to December 31, 2024, we purchased or are under contract to purchase 32
communication sites for an aggregate consideration of $14.6 million in cash. We anticipate that these acquisitions will be closed by
the end of the second quarter of 2025.
For 2025, we expect to incur non-discretionary cash capital expenditures associated with tower maintenance and general
corporate expenditures of $53.0 million to $63.0 million and discretionary cash capital expenditures, based on current or potential
acquisition obligations, planned new tower construction, forecasted tower augmentations, and forecasted ground lease purchases, of
$1,255.0 million to $1,275.0 million. We expect to fund these cash capital expenditures from cash on hand, cash flow from operations,
and borrowings under the Revolving Credit Facility or new financings. The exact amount of our future cash capital expenditures will
depend on a number of factors, including amounts necessary to support our tower portfolio, our new tower build and acquisition
programs, and our ground lease purchase program.
Financing Activities
A detail of our financing activities is as follows:
For the year ended December 31,
2024
2023
(in thousands)
Net repayments under Revolving Credit Facility (1)
$
(180,000)
$
(540,000)
Proceeds from issuance of Term Loans, net of fees (1)
2,280,565
—
Repayment of Term Loans (1)
(2,292,244)
(24,000)
Proceeds from issuance of Tower Securities, net of fees (1)
2,052,136
—
Repayment of Tower Securities (1)
(620,269)
—
Repurchase and retirement of common stock (2)
(200,019)
(100,010)
Payment of dividends on common stock
(424,191)
(369,960)
Proceeds from employee stock purchase/stock option plans, net of taxes
17,185
16,715
Other financing activities
12,579
37
Net cash provided by (used in) financing activities
$
645,742
$
(1,017,218)
(1)
For additional information regarding our debt instruments and financings, refer to “Debt Instruments and Debt Service
Requirements” below.
(2)
As of the date of this filing, we had $204.7 million remaining under the current authorized share repurchase plan.
For a discussion of our Liquidity and Capital Resources for the fiscal year ended December 31, 2023 compared to the fiscal
year ended December 31, 2022, refer to Part I, Item 7 of our annual report on Form 10-K filed with the SEC on February 28, 2024.
Dividends
For the year ended December 31, 2024, we paid the following cash dividends:
Payable to Shareholders
of Record at the Close
Cash Paid
Aggregate Amount
Date Declared
of Business on
Per Share
Paid
Date Paid
February 26, 2024
March 14, 2024
$0.98
$108.1 million (1)
March 28, 2024
April 29, 2024
May 23, 2024
$0.98
$105.3 million
June 18, 2024
July 28, 2024
August 22, 2024
$0.98
$105.3 million
September 18, 2024
October 27, 2024
November 14, 2024
$0.98
$105.4 million
December 12, 2024
(1)
Amount reflected includes the payment of $1.9 million in dividend equivalents.
Dividends paid in 2024 and 2023 were ordinary taxable dividends.
36
Subsequent to December 31, 2024, we declared the following cash dividends:
Payable to Shareholders
Cash to
of Record at the Close
be Paid
Date Declared
of Business on
Per Share
Date to be Paid
February 23, 2025
March 13, 2025
$1.11
March 27, 2025
The amount of future distributions will be determined, from time to time, by our Board of Directors to balance our goal of
increasing long-term shareholder value and retaining sufficient cash to implement our current capital allocation policy, which
prioritizes investment in quality assets that meet our return criteria, and then stock repurchases when we believe our stock price is
below its intrinsic value. The actual amount, timing, and frequency of future dividends will be at the sole discretion of our Board of
Directors and will be declared based upon various factors, many of which are beyond our control.
Registration Statements
We have on file with the Commission a shelf registration statement on Form S-4 registering shares of Class A common stock
that we may issue in connection with the acquisition of wireless communication towers or antenna sites and related assets or
companies who own wireless communication towers, antenna sites, or related assets. During the year ended December 31, 2024, we
did not issue any shares of Class A common stock under this registration statement. As of December 31, 2024, we had approximately
1.2 million shares of Class A common stock remaining under this registration statement.
On February 29, 2024, we filed with the Commission an automatic shelf registration statement for well-known seasoned
issuers on Form S-3ASR which enables us to issue shares of our Class A common stock, preferred stock, debt securities, warrants, or
depositary shares as well as units that include any of these securities. We will file a prospectus supplement containing the amount and
type of securities each time we issue securities under our automatic shelf registration statement on Form S-3ASR. During the year
ended December 31, 2024, we did not issue any securities under our automatic shelf registration statement.
Debt Instruments and Debt Service Requirements
The Senior Credit Agreement
On January 25, 2024, we, through our wholly owned subsidiary SBA Senior Finance II, amended and restated our Senior
Credit Agreement to (1) issue a new $2.3 billion Term Loan and retire the 2018 Term Loan, (2) increase the total commitments under
the Revolving Credit Facility from $1.5 billion to $1.75 billion, (3) extend the maturity date of the Revolving Credit Facility to
January 25, 2029, and (4) amend certain other terms and conditions under the Senior Credit Agreement.
On February 23, 2024, we, through our wholly owned subsidiary, SBA Senior Finance II LLC, further increased the total
commitments under the Revolving Credit Facility from $1.75 billion to $2.0 billion.
On October 2, 2024, we, through our wholly owned subsidiary, SBA Senior Finance II, amended our Senior Credit
Agreement to (1) reduce the stated rate of interest of the Initial Term Loans from, at SBA Senior Finance II’s election, the Base Rate
plus 100 basis points or Term SOFR plus 200 basis points to, at SBA Senior Finance II’s election, the Base Rate plus 75 basis points
or Term SOFR plus 175 basis points, and (2) amend certain other terms and conditions under the Senior Credit Agreement.
Terms of the Senior Credit Agreement
The Senior Credit Agreement requires SBA Senior Finance II to maintain specific financial ratios, including (1) a ratio of
Consolidated Net Debt to Annualized Borrower EBITDA not to exceed 6.5 times for any fiscal quarter, (2) a ratio of Consolidated Net
Debt (calculated in accordance with the Senior Credit Agreement) to Annualized Borrower EBITDA for the most recently ended fiscal
quarter not to exceed 6.5 times for 30 consecutive days, and (3) a ratio of Annualized Borrower EBITDA to Annualized Cash Interest
Expense (calculated in accordance with the Senior Credit Agreement) of not less than 2.0 times for any fiscal quarter. The Senior
Credit Agreement contains customary affirmative and negative covenants that, among other things, limit the ability of SBA Senior
Finance II and its subsidiaries to incur indebtedness, grant certain liens, make certain investments, enter into sale leaseback
transactions, merge or consolidate, make certain restricted payments, enter into transactions with affiliates, and engage in certain asset
dispositions, including a sale of all or substantially all of their property. The Senior Credit Agreement is also subject to customary
events of default. Pursuant to the Second Amended and Restated Guarantee and Collateral Agreement, amounts borrowed under the
Revolving Credit Facility, the Term Loans and certain hedging transactions that may be entered into by SBA Senior Finance II or the
Subsidiary Guarantors (as defined in the Senior Credit Agreement) with lenders or their affiliates are secured by a first lien on the
37
membership interests of SBA Telecommunications, LLC, SBA Senior Finance, LLC and SBA Senior Finance II and on substantially
all of the assets (other than leasehold, easement and fee interests in real property) of SBA Senior Finance II and the Subsidiary
Guarantors.
The Senior Credit Agreement permits SBA Senior Finance II, without the consent of the other lenders, to request that one or
more lenders provide SBA Senior Finance II with increases in the Revolving Credit Facility or additional term loans provided that
after giving effect to the proposed increase in Revolving Credit Facility commitments or incremental term loans the ratio of
Consolidated Net Debt to Annualized Borrower EBITDA would not exceed 6.5 times. SBA Senior Finance II’s ability to request such
increases in the Revolving Credit Facility or additional term loans is subject to its compliance with customary conditions set forth in
the Senior Credit Agreement including compliance, on a pro forma basis, with the financial covenants and ratios set forth therein and,
with respect to any additional term loan, an increase in the margin on existing term loans to the extent required by the terms of the
Senior Credit Agreement. Upon SBA Senior Finance II’s request, each lender may decide, in its sole discretion, whether to increase all
or a portion of its Revolving Credit Facility commitment or whether to provide SBA Senior Finance II with additional term loans and,
if so, upon what terms. As of December 31, 2024, SBA Senior Finance II was in compliance with the financial covenants contained in
the Senior Credit Agreement.
Revolving Credit Facility under the Senior Credit Agreement
The Revolving Credit Facility consists of a revolving loan under which up to $2.0 billion aggregate principal amount may be
borrowed, repaid and redrawn, based upon specific financial ratios and subject to the satisfaction of other customary conditions to
borrowing through the maturity date of January 25, 2029. Amounts borrowed under the Revolving Credit Facility accrue interest, at
SBA Senior Finance II’s election, at either (1) the Eurodollar Rate or Term SOFR Rate plus a margin that ranges from 112.5 basis
points to 150.0 basis points or (2) the Base Rate plus a margin that ranges from 12.5 basis points to 50.0 basis points, in each case
based on the ratio of Consolidated Net Debt to Annualized Borrower EBITDA, calculated in accordance with the Senior Credit
Agreement. In addition, SBA Senior Finance II is required to pay a commitment fee of between 0.15% and 0.25% per annum on the
amount of unused commitment. Furthermore, the Revolving Credit Facility incorporates sustainability-linked targets which will adjust
the Revolving Credit Facility’s applicable interest and commitment fee rates upward or downward based on how we perform against
those targets. Borrowings under the Revolving Credit Facility may be used for general corporate purposes. SBA Senior Finance II
may, from time to time, borrow from and repay the Revolving Credit Facility. Consequently, the amount outstanding under the
Revolving Credit Facility at the end of the period may not be reflective of the total amounts outstanding during such period.
The key terms of the Revolving Credit Facility are as follows:
Unused
Interest Rate
Commitment
as of
Fee as of
December 31, 2024 (1)
December 31, 2024 (2)
Revolving Credit Facility
5.407%
0.140%
(1)
The rate reflected includes a 0.050% reduction in the applicable spread as a result of meeting certain sustainability-linked
targets as of December 31, 2023.
(2)
The rate reflected includes a 0.010% reduction in the applicable commitment fee as a result of meeting certain sustainability-
linked targets as of December 31, 2023.
The table below summarizes our Revolving Credit Facility activity during the years ended December 31, 2024 and 2023 (in
thousands):
For the year
ended December 31,
2024
2023
Beginning outstanding balance
$
180,000
$
720,000
Borrowings
370,000
190,000
Repayments
(550,000)
(730,000)
Ending outstanding balance
$
—
$
180,000
Subsequent to December 31, 2024, we made no borrowings under the Revolving Credit Facility.
38
Term Loan under the Senior Credit Agreement
2024 Term Loan
On January 25, 2024, we, through our wholly owned subsidiary, SBA Senior Finance II, issued a term loan (the “2024 Term
Loan”) under the amended and restated Senior Credit Agreement. The 2024 Term Loan consists of a senior secured term loan with an
initial aggregate principal amount of $2.3 billion that matures on January 25, 2031. The 2024 Term Loan (as amended on October 2,
2024) accrues interest, at SBA Senior Finance II’s election, at either the Base Rate (with a zero Base Rate floor) plus 75 basis points
or at Term SOFR (with a floor of 0%) plus 175 basis points. The 2024 Term Loan was issued at 99.75% of par value. The proceeds
from the 2024 Term Loan were used to retire our 2018 Term Loan and to pay related fees and expenses. The 2024 Term Loan has a
blended rate of 2.428%, which includes the impact of the current interest rate swap. Excluding the impact of the interest rate swap, the
2024 Term Loan was accruing interest at 6.110% as of December 31, 2024.
Principal payments on the 2024 Term Loan are made in quarterly installments on the last day of each March, June,
September, and December in an amount equal to $5.75 million. We incurred financing fees of approximately $19.4 million in
relation to this transaction, which are being amortized through the maturity date.
During the year ended December 31, 2024, we repaid an aggregate of $17.3 million of principal on the 2024 Term Loan. As
of December 31, 2024, the 2024 Term Loan had a principal balance of $2.3 billion.
2018 Term Loan
The 2018 Term Loan consisted of a senior secured term loan with an initial aggregate principal amount of $2.4 billion that
was set to mature on April 11, 2025. The 2018 Term Loan accrued interest, at SBA Senior Finance II’s election, at either the Base
Rate plus 75 basis points (with a zero Base Rate floor) or the Eurodollar Rate plus 175 basis points (with a zero Eurodollar Rate floor).
On January 25, 2024, we, through our wholly owned subsidiary, SBA Senior Finance II, retired the 2018 Term Loan. In
connection with the repayment, we expensed $3.3 million of net deferred financing fees and $1.2 million of original issuance discount
related to the debt.
Interest Rate Swaps
On August 4, 2020, we, through our wholly owned subsidiary, SBA Senior Finance II, entered into an interest rate swap
which swapped $1.95 billion of notional value accruing interest at one month LIBOR plus 175 basis points for an all-in fixed rate of
1.874% per annum through July 31, 2023.
On June 21, 2023, we, through our wholly owned subsidiary, SBA Senior Finance II, amended our existing interest rate swap
agreement which swapped $1.95 billion of notional value accruing interest at one month Term SOFR plus 185 basis points for an all-
in fixed rate of 1.900% per annum from August 1, 2023 through January 25, 2024 (the repayment date of the 2018 Term Loan and
issuance date of the 2024 Term Loan). The swap remains in effect under the 2024 Term Loan (as amended on October 2, 2024) and
swaps $1.95 billion of notional value accruing interest at one month Term SOFR plus 175 basis points for an all-in fixed rate of
1.800% per annum through March 31, 2025.
On November 3, 2023, we, through our wholly owned subsidiary, SBA Senior Finance II, entered into a forward-starting
interest rate swap agreement which will swap $1.0 billion of notional value accruing interest at one month Term SOFR plus 175 basis
points for an all-in fixed rate of 5.580% per annum. On September 6, 2024, we, through our wholly owned subsidiary, SBA Senior
Finance II, entered into an additional forward-starting interest rate swap agreement to swap $1.0 billion of notional value accruing
interest at one month Term SOFR plus 175 basis points for an all-in fixed rate of 4.750% per annum (collectively the “forward-
starting swaps”). The forward-starting swaps have an effective start date of March 31, 2025 (coinciding with the expiration date of
the current $1.95 billion notional value swap) and a maturity date of April 11, 2028. The combined notional value of both forward-
starting swaps of $2.0 billion will effectively fix one month term SOFR for a blended all-in fixed rate of 5.165% per annum through
April 11, 2028.
39
Secured Tower Revenue Securities
Tower Revenue Securities Terms
As of December 31, 2024, we, through a New York common law trust (the “Trust”), had issued and outstanding an aggregate
of $8.4 billion of Secured Tower Revenue Securities (“Tower Securities”). The sole asset of the Trust consists of a non-recourse
mortgage loan made in favor of certain of our subsidiaries that are borrowers on the mortgage loan (the “Borrowers”) under which
there is a loan tranche for each Tower Security outstanding with the same interest rate and maturity date as the corresponding Tower
Security. The mortgage loan will be paid from the operating cash flows from the aggregate 9,516 tower sites owned by the Borrowers
as of December 31, 2024. The mortgage loan is secured by (1) mortgages, deeds of trust, and deeds to secure debt on a substantial
portion of the tower sites, (2) a security interest in the tower sites and substantially all of the Borrowers’ personal property and
fixtures, (3) the Borrowers’ rights under certain tenant leases, and (4) all of the proceeds of the foregoing. For each calendar month,
SBA Network Management, Inc., an indirect subsidiary (“Network Management”), is entitled to receive a management fee equal to
4.5% of the Borrowers’ operating revenues for the immediately preceding calendar month.
The Borrowers may prepay any of the mortgage loan components, in whole or in part, with no prepayment consideration,
(1) within six months (in the case of the component corresponding to the 2024-2C Tower Securities), twelve months (in the case of the
component corresponding to the 2019-1C Tower Securities, 2020-1C Tower Securities, 2021-1C Tower Securities, 2021-2C Tower
Securities, and 2022-1C Tower Securities), eighteen months (in the case of the components corresponding to the 2020-2C Tower
Securities and 2021-3C Tower Securities), or twenty-four months (in the case of the component corresponding to the 2024-1C Tower
Securities) of the anticipated repayment date of such mortgage loan component, (2) with proceeds received as a result of any
condemnation or casualty of any tower owned by the Borrowers or (3) during an amortization period. In all other circumstances, the
Borrowers may prepay the mortgage loan, in whole or in part, upon payment of the applicable prepayment consideration. The
prepayment consideration is determined based on the class of the Tower Securities to which the prepaid mortgage loan component
corresponds and consists of an amount equal to the net present value associated with the portion of the principal balance being prepaid
and calculated in accordance with the formula set forth in the mortgage loan agreement.
To the extent that the mortgage loan components corresponding to the Tower Securities are not fully repaid by their
respective anticipated repayment dates, the interest rate of each such component will increase by the greater of (1) 5% and (2) the
amount, if any, by which the sum of (x) the 10 year U.S. treasury rate plus (y) the credit-based spread for such component (as set forth
in the mortgage loan agreement) plus (z) 5%, exceeds the original interest rate for such component.
Pursuant to the terms of the Tower Securities, all rents and other sums due on any of the towers owned by the Borrowers are
directly deposited by the lessees into a controlled deposit account and are held by the indenture trustee. The monies held by the
indenture trustee after the release date are classified as short-term restricted cash on the Consolidated Balance Sheets (see Note 4).
However, if the Debt Service Coverage Ratio, defined as the net cash flow (as defined in the mortgage loan agreement) divided by the
amount of interest on the mortgage loan, servicing fees and trustee fees that the Borrowers are required to pay over the succeeding
twelve months, as of the end of any calendar quarter, falls to 1.30x or lower, then all cash flow in excess of amounts required to make
debt service payments, to fund required reserves, to pay management fees and budgeted operating expenses and to make other
payments required under the loan documents, referred to as “excess cash flow,” will be deposited into a reserve account instead of
being released to the Borrowers. The funds in the reserve account will not be released to the Borrowers unless the Debt Service
Coverage Ratio exceeds 1.30x for two consecutive calendar quarters. If the Debt Service Coverage Ratio falls below 1.15x as of the
end of any calendar quarter, then an “amortization period” will commence and all funds on deposit in the reserve account will be
applied to prepay the mortgage loan until such time that the Debt Service Coverage Ratio exceeds 1.15x for a calendar quarter. In
addition, if any of the Tower Securities are not fully repaid by their respective anticipated repayment dates, the cash flow from the
towers owned by the Borrowers will be trapped by the trustee for the Tower Securities and applied first to repay the interest, at the
original interest rates, on the mortgage loan components underlying the Tower Securities, second to fund all reserve accounts and
operating expenses associated with those towers, third to pay the management fees due to Network Management, fourth to repay
principal of the Tower Securities and fifth to repay the additional interest discussed above. Furthermore, the advance rents reserve
requirement states that the Borrowers are required to maintain an advance rents reserve at any time the monthly tenant Debt Service
Coverage Ratio is equal to or less than 2:1 and for two calendar months after such coverage ratio again exceeds 2:1. The mortgage
loan agreement, as amended, also includes covenants customary for mortgage loans subject to rated securitizations. Among other
things, the Borrowers are prohibited from incurring other indebtedness for borrowed money or further encumbering their assets.
40
The table below sets forth the material terms of our outstanding Tower Securities as of December 31, 2024:
Security
Issue Date
Amount
Outstanding
(in millions)
Interest
Rate (1)
Anticipated
Repayment Date
Final Maturity
Date
2019-1C Tower Securities (2)
Sep. 13, 2019
$1,165.0
2.836%
Jan. 12, 2025
Jan. 12, 2050
2020-1C Tower Securities
Jul. 14, 2020
$750.0
1.884%
Jan. 9, 2026
Jul. 11, 2050
2020-2C Tower Securities
Jul. 14, 2020
$600.0
2.328%
Jan. 11, 2028
Jul. 9, 2052
2021-1C Tower Securities
May 14, 2021
$1,165.0
1.631%
Nov. 9, 2026
May 9, 2051
2021-2C Tower Securities
Oct. 27, 2021
$895.0
1.840%
Apr. 9, 2027
Oct. 10, 2051
2021-3C Tower Securities
Oct. 27, 2021
$895.0
2.593%
Oct. 9, 2031
Oct. 10, 2056
2022-1C Tower Securities
Nov. 23, 2022
$850.0
6.599%
Jan. 11, 2028
Nov. 9, 2052
2024-1C Tower Securities
Oct. 11, 2024
$1,450.0
4.831%
Oct. 9, 2029
Oct. 8, 2054
2024-2C Tower Securities (3)
Oct. 11, 2024
$620.0
4.654%
Oct. 8, 2027
Oct. 8, 2054
(1)
Interest paid monthly.
(2)
On January 15, 2025, we repaid the aggregate amount of the 2019-1C Tower Securities.
(3)
The interest rate reflected is the all-in fixed rate which includes the impact of our treasury lock agreement entered on
September 11, 2024. The treasury lock agreement fixed the three-year treasury rate at 3.3985% for $620.0 million of notional
value related to the 2024-2C Tower Securities issued on October 11, 2024. Excluding the impact of the treasury lock
agreement, the 2024-2C Tower Securities accrue interest at 5.115%.
Risk Retention Tower Securities
The table below sets forth the material terms of our outstanding Risk Retention Tower Securities as of December 31, 2024:
Security
Issue Date
Amount
Outstanding
(in millions)
Interest
Rate (1)
Anticipated
Repayment Date
Final Maturity
Date
2019-1R Tower Securities (2)
Sep. 13, 2019
$61.4
4.213%
Jan. 12, 2025
Jan. 12, 2050
2020-2R Tower Securities
Jul. 14, 2020
$71.1
4.336%
Jan. 11, 2028
Jul. 9, 2052
2021-1R Tower Securities
May 14, 2021
$61.4
3.598%
Nov. 9, 2026
May 9, 2051
2021-3R Tower Securities
Oct. 27, 2021
$94.3
4.090%
Oct. 9, 2031
Oct. 10, 2056
2022-1R Tower Securities
Nov. 23, 2022
$44.8
7.870%
Jan. 11, 2028
Nov. 9, 2052
2024-1R Tower Securities
Oct. 11, 2024
$108.7
6.252%
Oct. 9, 2029
Oct. 8, 2054
(1)
Interest paid monthly.
(2)
On January 15, 2025, we repaid the aggregate amount of the 2019-1R Tower Securities.
To satisfy certain risk retention requirements of Regulation RR promulgated under the Exchange Act, SBA Guarantor, LLC,
a wholly owned subsidiary, purchased the Risk Retention Tower Securities. Principal and interest payments made on the 2019-1R
Tower Securities, 2020-2R Tower Securities, 2021-1R Tower Securities, 2021-3R Tower Securities, 2022-1R Tower Securities, and
2024-1R Tower Securities eliminate in consolidation.
Debt Covenants
As of December 31, 2024, the Borrowers met the debt service coverage ratio required by the mortgage loan agreement and
were in compliance with all other covenants as set forth in the agreement.
Senior Notes
The table below sets forth the material terms of our outstanding senior notes as of December 31, 2024:
Senior Notes
Issue Date
Amount
Outstanding
(in millions)
Interest Rate
Coupon
Maturity Date
Interest Due Dates
Optional
Redemption
Date
2020 Senior Notes
Feb. 4, 2020
$1,500.0
3.875%
Feb. 15, 2027
Feb. 15 & Aug. 15 Feb. 15, 2024
2021 Senior Notes
Jan. 29, 2021
$1,500.0
3.125%
Feb. 1, 2029
Feb. 1 & Aug. 1
Feb. 1, 2024
41
Each of our senior notes is subject to redemption, at our option, in whole or in part on or after the date set forth above. During
the subsequent three twelve-month periods, the senior notes are redeemable, at our option, at reducing redemption prices based on the
applicable interest rate coupon (as set forth in the indenture) plus accrued and unpaid interest. Subsequent to such date, the senior
notes become redeemable until maturity at 100% of the principal plus accrued and unpaid interest. We may redeem each of the senior
notes during the time periods and at the redemption prices set forth in the indentures.
Indentures Governing Senior Notes
The Indentures governing the Senior Notes contain customary covenants, subject to a number of exceptions and
qualifications, including restrictions on the ability of SBAC and Telecommunications to (1) incur additional indebtedness unless the
Consolidated Indebtedness to Annualized Consolidated Adjusted EBITDA Ratio (as defined in the Indenture), pro forma for the
additional indebtedness does not exceed, with respect to any fiscal quarter, 9.5x for SBAC, (2) merge, consolidate, or sell assets, (3)
make restricted payments, including dividends or other distributions, (4) enter into transactions with affiliates, and (5) enter into sale
and leaseback transactions and restrictions on the ability of the Restricted Subsidiaries of SBAC (as defined in the Indentures) to incur
liens securing indebtedness.
Debt Service
As of December 31, 2024, we believe that our cash on hand, capacity available under our Revolving Credit Facility, and cash
flows from operations for the next twelve months will be sufficient to service our outstanding debt during the next twelve months.
The following table illustrates our estimate of our debt service requirement over the next twelve months ended December 31,
2025 based on the amounts outstanding as of December 31, 2024 and the interest rates accruing on those amounts on such date (in
thousands):
Revolving Credit Facility (1)
$
2,800
2024 Term Loan (2)
127,290
2019-1C Tower Securities (3)
1,166,297
2020-1C Tower Securities
14,368
2020-2C Tower Securities
14,159
2021-1C Tower Securities
19,371
2021-2C Tower Securities
16,752
2021-3C Tower Securities
23,491
2022-1C Tower Securities
56,362
2024-1C Tower Securities
70,510
2024-2C Tower Securities
29,052
2020 Senior Notes
58,125
2021 Senior Notes
46,875
Total debt service for the next 12 months
$
1,645,452
(1)
As of December 31, 2024, no amount was outstanding under the Revolving Credit Facility. Subsequent to December 31,
2024, we made no borrowings under the Revolving Credit Facility.
(2)
Total debt service on the 2024 Term Loan includes the impact of the interest rate swap which swaps $1.95 billion of notional
value accruing interest at Term SOFR plus 175 basis points for an all-in fixed rate of 1.800% per annum through March 31,
2025 and the forward-starting interest rate swaps, which will swap $2.0 billion of notional value accruing interest at Term
SOFR plus 175 basis points for a blended all-in fixed rate of 5.165% per annum beginning March 31, 2025 through April 11,
2028.
(3)
On January 15, 2025, we repaid the full amount of the 2019-1C Tower Securities.
Inflation
The impact of inflation on our operations has not been material to date. However, the impact of higher interest rates, has
impacted, and is expected to continue to impact, our growth rate and future operating results. Higher interest rates have impacted, and
are expected to continue to impact, the ability and willingness of wireless service providers to incur capital expenditures at prior levels
to expand their networks, which could adversely affect our future revenue growth rates. In addition, increased interest rates may
adversely affect our costs to refinance our indebtedness at maturity. In addition, persistent high rates of inflation could adversely affect
our future operating results particularly in light of the fact that our site leasing revenues are governed by long-term contracts with pre-
42
determined pricing that we will not be able to increase in response to increases in inflation other than our contracts in South America
and Africa which have inflationary index-based rent escalators.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are exposed to certain market risks that are inherent in our financial instruments. These instruments arise from
transactions entered into in the normal course of business.
The following table presents the future principal payment obligations, fair values, and interest payments associated with our
long-term debt instruments assuming our actual level of long-term indebtedness as of December 31, 2024:
2025
2026
2027
2028
2029
Thereafter
Total
Fair Value
(in thousands)
2024 Term Loan
$
23,000 $
23,000 $
23,000 $
23,000 $
23,000 $
2,167,750 $
2,282,750 $
2,282,750
2019-1C Tower Securities (1)
1,165,000
—
—
—
—
—
1,165,000
1,128,803
2020-1C Tower Securities (1)
—
750,000
—
—
—
—
750,000
726,038
2020-2C Tower Securities (1)
—
—
—
600,000
—
—
600,000
516,342
2021-1C Tower Securities (1)
—
1,165,000
—
—
—
—
1,165,000
1,008,331
2021-2C Tower Securities (1)
—
—
895,000
—
—
—
895,000
763,757
2021-3C Tower Securities (1)
—
—
—
—
—
895,000
895,000
679,144
2022-1C Tower Securities (1)
—
—
—
850,000
—
—
850,000
878,475
2024-1C Tower Securities (1)
—
—
—
—
1,450,000
—
1,450,000
1,453,292
2024-2C Tower Securities (1)
—
—
620,000
—
—
—
620,000
618,698
2020 Senior Notes
—
—
1,500,000
—
—
—
1,500,000
1,440,270
2021 Senior Notes
—
—
—
—
1,500,000
—
1,500,000
1,353,750
Total debt obligation
$
1,188,000 $
1,938,000 $
3,038,000 $
1,473,000 $
2,973,000 $
3,062,750 $
13,672,750 $
12,849,650
Interest payments (2)
$
457,452 $
469,360 $
384,500 $
279,785 $
218,528 $
345,873 $
2,155,498
(1)
For information on the anticipated repayment date and final maturity date for each tower security, refer to Debt Instruments
and Debt Service Requirements above.
(2)
Represents interest payments based on the 2019-1C Tower Securities interest rate of 2.836%, the 2020-1C Tower Securities
interest rate of 1.884%, the 2020-2C Tower Securities interest rate of 2.328%, the 2021-1C Tower Securities interest rate of
1.631%, the 2021-2C Tower Securities interest rate of 1.840%, the 2021-3C Tower Securities interest rate of 2.593%, the
2022-1C Tower Securities interest rate of 6.599%, the 2024-1C Tower Securities interest rate of 4.831%, the 2024-2C Tower
Securities of all-in interest rate of 4.654%, the 2024 Term Loan at an average interest rate of 2.428% (which includes the
impact of interest rate swaps) as of December 31, 2024, the 2020 Senior Notes interest rate of 3.875%, and the 2021 Senior
Notes interest rate of 3.125%.
Our current primary market risk exposure is (1) interest rate risk relating to our ability to refinance our debt at commercially
reasonable rates, if at all, and (2) interest rate risk relating to the impact of interest rate movements on the variable portion of our 2024
Term Loan, and any borrowings that we may incur under our Revolving Credit Facility, which are at floating rates. We manage the
interest rate risk on our outstanding debt through our large percentage of fixed rate debt, including interest rate swaps. While we
cannot predict our ability to refinance existing debt or the impact interest rate movements will have on our existing debt, we continue
to evaluate our financial position on an ongoing basis.
We have performed a sensitivity analysis assuming a hypothetical 1% increase in our variable interest rates as of December
31, 2024. As of December 31, 2024, the analysis indicated that such an adverse movement would have caused our interest expense to
increase by approximately 1.7% for the year ended December 31, 2024.
We are exposed to market risk from changes in foreign currency exchange rates in connection with our operations in Brazil,
Canada, Chile, Peru, Colombia, Costa Rica, South Africa, Tanzania, and to a lesser extent, our markets in Central America. In each of
these countries, we pay most of our selling, general, and administrative expenses and a portion of our operating expenses, such as
taxes and utilities incurred in the country in local currency. In addition, in Brazil, Canada, Chile, and South Africa, we receive
significantly all of our revenue and pay significantly all of our operating expenses in local currency. In Colombia, Costa Rica, Peru,
and Tanzania, we receive our revenue and pay our operating expenses in a mix of local currency and U.S. dollars. All transactions
denominated in currencies other than the U.S. Dollar are reported in U.S. Dollars at the applicable exchange rate. All assets and
liabilities are translated into U.S. Dollars at exchange rates in effect at the end of the applicable fiscal reporting period, and all
revenues and expenses are translated at average rates for the period. The cumulative translation effect is included in equity as a
43
component of Accumulated other comprehensive income (loss). For the year ended December 31, 2024, approximately 21.8% of our
revenues and approximately 31.1% of our total operating expenses were denominated in foreign currencies.
We have performed a sensitivity analysis assuming a hypothetical 10% adverse movement in the Brazilian Real from the
quoted foreign currency exchange rates at December 31, 2024. The analysis indicated that such an adverse movement would have
caused our revenues and operating income to decline by approximately 1.3% and 1.0%, respectively, for the year ended December 31,
2024.
As of December 31, 2024, we had intercompany debt, which is denominated in a currency other than the functional currency
of the subsidiary in which it is recorded. As settlement of this debt is anticipated or planned in the foreseeable future, any changes in
the foreign currency exchange rates will result in unrealized gains or losses, which will be included in our determination of net
income. A change of 10% in the underlying exchange rates of our unsettled intercompany debt at December 31, 2024 would have
resulted in approximately $113.6 million of unrealized gains or losses that would have been included in Other (expense) income, net
in our Consolidated Statements of Operations for the year ended December 31, 2024.
Special Note Regarding Forward-Looking Statements
This annual report contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Exchange Act. These statements concern expectations, beliefs, projections, plans and strategies,
anticipated events or trends and similar expressions concerning matters that are not historical facts. Specifically, this annual report
contains forward-looking statements regarding:
• our expectations on the future growth and financial health of the wireless industry and the industry participants, the drivers
of such growth, the demand for our towers, the future capital investments of our customers (including with respect to the
implementation of broad based 5G availability), future spectrum auctions, the trends developing in our industry, and
competitive factors;
• our ability to capture and capitalize on industry growth and the impact of such growth on our financial and operational
results;
• our expectations regarding Echostar;
• our expectations regarding the consolidation of wireless service providers and the impact of such consolidation on our
financial and operational results;
• our intent to grow our tower portfolio domestically and internationally and expand through acquisitions, new builds and
organic lease up on existing towers;
• our belief that over the long-term, site leasing revenues will continue to grow as wireless service providers increase their
use of our towers due to increasing minutes of network use and data transfer, network expansion and network coverage
requirements;
• our expectation regarding site leasing revenue growth, on an organic basis, in our domestic and international segments, and
the drivers of such growth;
• our focus on our site leasing business and belief that our site leasing business is characterized by stable and long-term
recurring revenues, reduced exposure to changes in customer spending, predictable operating costs, and minimal non-
discretionary capital expenditures;
• our expectation that, due to the nature and mix of our tower portfolio, future expenditures required to maintain these towers
will be minimal;
• our expectation regarding the scalability of our operations and growth of our cash flows by adding tenants to our towers at
minimal incremental costs and executing monetary amendments;
• our expectations regarding churn rates, including with respect to legacy Sprint leases and Oi leases;
• our expectations regarding the timing for closing of pending acquisitions, including the Millicom transaction;
• our election to be subject to tax as a REIT and our intent to continue to operate as a REIT;
• our beliefs regarding compliance with applicable laws and regulations, including environmental laws, and the impact of
various legal proceedings;
• our plans regarding our distribution policy, and the amount and timing of, and source of funds for, any such distributions;
• our expectations regarding the use of NOLs to reduce REIT taxable income;
• our expectations regarding our capital allocation strategies, including future allocation decisions among portfolio growth,
stock repurchases, and dividends, the impact of our election to be taxed as a REIT on that strategy, and our goal of
increasing our Adjusted Funds From Operations per share;
• our expectations regarding dividends and our ability to grow our dividend in the future and the drivers of such growth;
• our expectations regarding our future cash capital expenditures, both discretionary and non-discretionary, including
expenditures required for new builds and to maintain, improve, and modify our towers, ground lease purchases, and
general corporate expenditures, and the source of funds for these expenditures;
44
• our expectations regarding our business strategies, including our strategy for securing rights to the land underlying our
towers, and the impact of such strategies on our financial and operational results;
• our intended use of our liquidity;
• our intent to maintain our target leverage levels, including in light of our dividend;
• our expectations regarding our debt service in 2025 and our ability to service our outstanding debt during the next twelve
months; and
• our expectations and estimates regarding certain tax and accounting matters, including the impact on our financial
statements.
These forward-looking statements reflect our current views about future events and are subject to risks, uncertainties and
assumptions. We undertake no obligation to update forward-looking statements to reflect events or circumstances after the date hereof,
unless otherwise required by law. We wish to caution readers that certain important factors may have affected and could in the future
affect our actual results and could cause actual results to differ significantly from those expressed in any forward-looking statement.
The most important factors that could prevent us from achieving our goals, and cause the assumptions underlying forward-looking
statements and the actual results to differ materially from those expressed in or implied by those forward-looking statements include,
but are not limited to, the following:
• developments in, and macroeconomic influences on, the wireless communications industry in general, and for wireless
communications infrastructure providers in particular, that may slow growth or affect our customers’ access to sufficient
capital, or ability to expend capital to fund network expansion or enhancements;
• the impact of churn based on prior and future consolidation among wireless service providers;
• the ability of Echostar to become and compete as a nationwide carrier;
• the impact of high interest rates on our results of operations and our ability to refinance our existing indebtedness at
commercially reasonable rates or at all;
• our ability to continue to comply with covenants and the terms of our credit instruments and our ability to obtain additional
financing to fund our capital expenditures;
• our ability to successfully manage the risks associated with international operations, including risks relating to competition,
political or economic conditions, inflation, potential tariffs, tax laws, currency restrictions and exchange rate fluctuations,
legal or judicial systems, and land ownership, including land ownership risks with respect to towers we don’t own;
• our ability to successfully manage the risks associated with our acquisition initiatives, including our ability to satisfactorily
complete due diligence on acquired towers, the amount and quality of due diligence that we are able to complete prior to
closing of any acquisition, our ability to accurately anticipate the future performance of the acquired towers, our ability to
receive required regulatory approval, the ability and willingness of each party to fulfill their respective closing conditions
and their contractual obligations, and, once acquired, our ability to effectively integrate acquired towers into our business
and to achieve the financial results projected in our valuation models for the acquired towers;
• the health of the economies and wireless communications markets of the international jurisdictions we operate in, and the
willingness of carriers to invest in their networks in such markets;
• our ability to secure as many site leasing tenants as anticipated, recognize our expected economies of scale with respect to
new tenants on our towers, and retain current leases on towers;
• our ability to secure and deliver anticipated services business at contemplated margins;
• our ability to build new towers, including our ability to identify and acquire land that would be attractive for our customers
and to successfully and timely address zoning, permitting, weather, availability and cost of labor and supplies and other
issues that arise in connection with the building of new towers;
• competition for the acquisition of towers and other factors that may adversely affect our ability to purchase towers that
meet our investment criteria and are available at prices which we believe will be accretive to our shareholders and allow us
to maintain our long-term target leverage ratios while achieving our expected portfolio growth levels;
• our capital allocation decisions and the impact on our ability to achieve our expected tower portfolio growth levels;
• our ability to protect our rights to the land under our towers, and our ability to acquire land underneath our towers on terms
that are accretive;
• our ability to sufficiently increase our revenues and maintain expenses and cash capital expenditures at appropriate levels
to permit us to meet our anticipated uses of liquidity for operations, debt service and estimated portfolio growth;
• our ability to successfully estimate the impact of regulatory and litigation matters;
• natural disasters and other unforeseen damage for which our insurance may not provide adequate coverage;
• a decrease in demand for our towers;
• the introduction of new technologies or changes in a tenant’s business model that may make our tower leasing business less
desirable to existing or potential tenants;
• our ability to qualify for treatment as a REIT for U.S. federal income tax purposes and to comply with and conduct our
business in accordance with such rules;
• our ability to utilize available NOLs to reduce REIT taxable income;
45
• our ability to successfully estimate the impact of certain accounting and tax matters, including the effect on our company
of adopting certain accounting pronouncements and the availability of sufficient NOLs to offset future REIT taxable
income; and
• other risks, including those described in Item 1A. – Risk Factors in this annual report and those described from time to time
in our other filings with the SEC.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Financial statements and supplementary data are on pages F-1 through F-43.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures – We maintain disclosure controls and procedures that are designed to ensure that
information required to be disclosed in our reports under the Exchange Act, is recorded, processed, summarized, and reported within
the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management,
including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate, to allow timely decisions
regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any
controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired
control objectives, as ours are designed to do, and management necessarily was required to apply its judgment in evaluating the cost-
benefit relationship of possible controls and procedures.
In connection with the preparation of this Annual Report on Form 10-K, as of December 31, 2024, an evaluation was
performed under the supervision and with the participation of our management, including the CEO and CFO, of the effectiveness of
our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on such evaluation, our CEO
and CFO concluded that, as of December 31, 2024, our disclosure controls and procedures were effective.
There has been no change in our internal control over financial reporting during the quarter ended December 31, 2024 that
has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Management’s Annual Report on Internal Control over Financial Reporting – Management is responsible for
establishing and maintaining adequate internal control over financial reporting, and for performing an assessment of the effectiveness
of internal control over financial reporting as of December 31, 2024. Internal control over financial reporting is a process designed to
provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles. Our system of internal control over financial reporting includes
those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of SBAC; (2) provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of SBAC are being made only in accordance with authorizations of management and directors of SBAC; and (3) provide
reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of SBAC’s assets that
could have a material effect on the financial statements.
Management performed an assessment of the effectiveness of SBAC’s internal control over financial reporting as of
December 31, 2024 based upon criteria in Internal Control – Integrated Framework (2013 Framework) issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). Based on our assessment, management determined that SBAC’s
internal control over financial reporting was effective as of December 31, 2024 based on the criteria in Internal Control – Integrated
Framework (2013 Framework) issued by COSO.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of
changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
46
Ernst & Young LLP, the independent registered public accounting firm that audited the financial statements included in this
Annual Report on Form 10-K, has issued an attestation report on SBAC’s internal control over financial reporting.
47
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of SBA Communications Corporation
Opinion on Internal Control Over Financial Reporting
We have audited SBA Communications Corporation and subsidiaries’ internal control over financial reporting as of December 31, 2024, based
on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission (2013 framework) (the COSO criteria). In our opinion, SBA Communications Corporation and subsidiaries (the Company)
maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the
consolidated balance sheets of the Company as of December 31, 2024 and 2023, the related consolidated statements of operations,
comprehensive income, shareholders’ deficit and cash flows for each of the three years in the period ended December 31, 2024, and the related
notes and financial statement schedule listed in the Index at Item 15(a)(2) and our report dated February 26, 2025 expressed an unqualified
opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the
effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over
Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.
We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance
with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists,
testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other
procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A
company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that,
in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance
that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and
directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or
that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young LLP
Boca Raton, Florida
February 26, 2025
48
ITEM 9B. OTHER INFORMATION
(a) 10b5-1 Trading Plans
During the three months ended December 31, 2024, none of our officers (as defined in Rule 16a-1(f) of the Exchange Act) or
directors adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is
defined in Item 408(d) of Regulation S-K.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
None.
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
We have adopted a Code of Ethics that applies to our Chief Executive Officer, Chief Financial Officer and Chief Accounting
Officer. The Code of Ethics is located on our internet web site at www.sbasite.com under “Investors – Governance – Governance
Documents.” We intend to provide disclosure of any amendments or waivers of our Code of Ethics on our website within 4 business
days following the date of the amendment or waiver.
The remaining items required by Part III, Item 10 are incorporated herein by reference from the Registrant’s Proxy Statement
for its 2025 Annual Meeting of Shareholders to be filed on or before April 30, 2025.
ITEM 11. EXECUTIVE COMPENSATION
The items required by Part III, Item 11 are incorporated herein by reference from the Registrant’s Proxy Statement for its
2025 Annual Meeting of Shareholders to be filed on or before April 30, 2025.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
The items required by Part III, Item 12, other than the information regarding the Registrant’s equity plans set forth below
required by Item 201(d) of Regulation S-K, are incorporated herein by reference from the Registrant’s Proxy Statement for its 2025
Annual Meeting of Shareholders to be filed on or before April 30, 2025.
49
Equity Compensation Plan
The following table summarizes information with respect to the Registrant’s compensation plans under which the
Registrant’s equity securities are authorized for issuance as of December 31, 2024:
Equity Compensation Plan Information
As of December 31, 2024
(in thousands, except exercise price)
Number of Securities
Number of Securities
Weighted-Average
Remaining Available for
to be Issued
Exercise Price
Future Issuance Under
Upon Exercise of
of Outstanding
Equity Compensation Plans
Outstanding Options,
Options, Warrants
(Excluding Securities
Warrants and Rights
and Rights
Reflected in first column (a))
(a)
(b)
(c)
Equity compensation plans approved by
security holders
2010 Plan
1,058 (1)
$
172.34
—
2020 Plan
698 (2)
11.13
1,929
Equity compensation plans not approved by
security holders
—
—
Total
1,756
$
108.22
1,929
(1)
Included in the number of securities in column (a) is 18 restricted stock units which have no exercise price. The weighted-
average exercise price of outstanding options, warrants, and rights (excluding restricted stock units) is $172.34.
(2)
Included in the number of securities in column (a) is 392,911 restricted stock units and 275,461 performance-based restricted
stock units, which have no exercise price. The weighted-average exercise price of outstanding options, warrants, and rights
(excluding restricted stock units) is $259.16.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The items required by Part III, Item 13 are incorporated herein by reference from the Registrant’s Proxy Statement for its
2025 Annual Meeting of Shareholders to be filed on or before April 30, 2025.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The items required by Part III, Item 14 are incorporated herein by reference from the Registrant’s Proxy Statement for its
2025 Annual Meeting of Shareholders to be filed on or before April 30, 2025.
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(a) Documents filed as part of this report:
(1) Financial Statements
See Item 8 for Financial Statements included with this Annual Report on Form 10-K.
(2) Financial Statement Schedules
Schedule III—Schedule of Real Estate and Accumulated Depreciation (see below)
All other schedules are omitted because they are not applicable or because the required information is contained in the
financial statements or notes thereto included in this Form 10-K.
50
Schedule III—Schedule of Real Estate and Accumulated Depreciation
Gross
Life on Which
Cost
Amount
Accumulated
Depreciation
Capitalized
Carried
Depreciation
in Latest
Initial
Subsequent
at Close
at Close
Income
Cost to
to
of Current
of Current
Date of
Date
Statement is
Description
Encumbrances
Company
Acquisition
Period
Period
Construction
Acquired
Computed
(in thousands)
39,749 sites
(1)$
10,672,750
(2)
(3)
(3)
$
8,213,791
(4)
$
(4,291,860)
Various
Various
Up to 70 years
(5)
(1) No single site exceeds 5% of the aggregate gross amounts at which the assets were carried at the close of the period set
forth in the table above.
(2) As of December 31, 2024, certain assets secure debt of $10.7 billion.
(3) The Company has omitted this information, as it would be impracticable to compile such information on a site-by-site
basis.
(4) Does not include those sites under construction.
(5) Amounts include the acquisition of the exclusive right to lease and operate utility transmission structures, which included
existing wireless tenant licenses from PG&E.
2024
2023
2022
(in thousands)
Gross amount at beginning
$
8,231,510
$
7,993,750
$
7,068,208
Additions during period:
Acquisitions (1)
34,350
22,081
727,863
Construction and related costs on new builds
131,539
59,873
69,384
Augmentation and tower upgrades
54,181
82,917
60,247
Land buyouts and other assets
31,739
32,247
26,588
Tower maintenance
50,182
49,471
42,048
Other (2)
2,942
35,880
23,824
Total additions
304,933
282,469
949,954
Deductions during period:
Cost of real estate sold or disposed
(437)
(8,024)
(610)
Impairment (3)
(73,977)
(119,307)
(23,638)
Other (4)
(248,238)
82,622
(164)
Total deductions
(322,652)
(44,709)
(24,412)
Balance at end
$
8,213,791 $
8,231,510
$
7,993,750
(1) Inclusive of changes between the final purchase price allocation and the preliminary purchase price allocations. Amounts
as of December 31, 2022 include the acquisition of sites from GTS.
(2) Represents changes to the Company’s asset retirement obligations.
(3) Impairment charges for the year ended December 31, 2023 include the impact of the planned abandonment of identified
sites with minimal expectations of future economic benefit (primarily from Sprint and Oi related churn).
(4) Primarily represents cumulative translation adjustments related to changes in foreign currency exchange rates.
2024
2023
2022
(in thousands)
Gross amount of accumulated depreciation at beginning
$
(4,232,369) $
(3,925,893) $
(3,644,238)
Additions during period:
Depreciation (1)
(128,548)
(300,458)
(285,918)
Other (2)
(693)
(14,339)
(3,382)
Total additions
(129,241)
(314,797)
(289,300)
Deductions during period:
Amount of accumulated depreciation for assets sold or disposed
24,210
8,070
7,505
Other (2)
45,540
251
140
Total deductions
69,750
8,321
7,645
Balance at end
$
(4,291,860) $
(4,232,369) $
(3,925,893)
51
(1) Amounts as of December 31, 2022 include the depreciation related to the acquisition of sites from GTS.
(2) Primarily represents cumulative translation adjustments related to changes in foreign currency exchange rates.
(3) Exhibits
Incorporated by Reference
Exhibit
No.
Exhibit Description
Form
Period Covered or
Date of Filing
3.1
Amended and Restated Articles of Incorporation of SBA Communications
Corporation, effective as of January 13, 2017.
8-K
01/17/17
3.2
Articles of Merger, effective as of January 13, 2017.
8-K
01/17/17
3.3
Second Amended and Restated Bylaws of SBA Communications Corporation,
effective as of January 14, 2017.
8-K
01/18/17
4.1
Description of Capital Stock
8-K
01/17/17
4.30
Indenture dated as of February 4, 2020, between SBA Communications
Corporation and U.S. Bank National Association
8-K
02/07/20
4.30A Supplemental Indenture dated as of May 26, 2020, between SBA
Communications Corporation and U.S. Bank National Association to the
Indenture, dated as of February 4, 2020, between SBA Communications
Corporation and U.S. Bank National Association.
8-K
05/28/20
4.31
Form of 3.875% Senior Notes due 2027 (included in Exhibit 4.30)
8-K
02/07/20
4.32
Indenture dated as of January 29, 2021, between SBA Communications
Corporation and U.S. Bank National Association.
8-K
01/29/21
4.33
Form of 3.125% Senior Notes due 2029 (included in Exhibit 4.32).
8-K
01/29/21
10.1
SBA Communications Corporation Registration Rights Agreement dated as of
March 5, 1997, among the Company, Steven E. Bernstein, Ronald G. Bizick, II
and Robert Grobstein.
S-4
(333-50219)
04/15/98
10.6A Purchase Agreement, dated September 10, 2024, among SBA Senior Finance,
LLC, Deutsche Bank Trust Company Americas, as Trustee, and the several
Initial Purchasers listed on Schedule I thereto.
8-K
10/11/24
10.6B Purchase Agreement, dated October 11, 2024, among SBA Senior Finance, LLC,
Deutsche Bank Trust Company Americas, as Trustee, and the several Initial
Purchasers listed on Schedule I thereto.
8-K
10/11/24
10.7D Third Amended and Restated Credit Agreement, dated as of January 25, 2024,
among SBA Senior Finance II LLC, as borrower, the banks and other financial
institutions or entities party thereto and Toronto Dominion (Texas) LLC, as
administrative agent.
8-K
01/25/24
10.7E First Amendment to the Third Amended and Restated Credit Agreement, dated
October 2, 2024 among SBA Senior Finance II LLC, the lenders and other
persons party thereto and Toronto Dominion (Texas) LLC, as administrative
agent.
8-K
10/02/24
10.8A Third Amended and Restated Guarantee and Collateral Agreement, dated as of
January 25, 2024, among SBA Communications Corporation, SBA
Telecommunications, LLC, SBA Senior Finance, LLC, SBA Senior Finance II
8-K
01/25/24
52
LLC and certain of its subsidiaries party thereto, in favor of Toronto Dominion
(Texas) LLC, as administrative agent.
10.12 Second Amended and Restated Loan and Security Agreement, dated as of
October 15, 2014, among SBA Properties, LLC, SBA Sites, LLC, SBA
Structures, LLC, SBA Infrastructure, LLC, SBA Monarch Towers III, LLC, SBA
2012 TC Assets PR, LLC, SBA 2012 TC Assets, LLC, SBA Towers IV, LLC,
SBA Monarch Towers I, LLC, SBA Towers USVI, Inc., SBA GC Towers, LLC,
SBA Towers VII, LLC and any Additional Borrower or Borrowers that may
become a party thereto and Midland Loan Services, as Servicer on behalf of
Deutsche Bank Trust Company Americas, as Trustee.
10-Q
Quarter ended
September 30, 2014
10.12A First Loan and Security Agreement Supplement and Amendment, dated as of
October 14, 2015, by and among the Borrowers named therein and Midland Loan
Services, a division of PNC Bank, National Association, as Servicer on behalf of
Deutsche Bank Trust Company Americas, as Trustee.
8-K
10/20/15
10.12B Second Loan and Security Agreement Supplement, dated as of July 7, 2016, by
and among the Borrowers named therein and Midland Loan Services, a division
of PNC Bank, National Association, as Servicer on behalf of Deutsche Bank
Trust Company Americas, as Trustee.
8-K
07/08/16
10.12C Third Loan and Security Agreement Supplement and Amendment, dated as of
April 17, 2017, by and among the Borrowers named therein and Midland Loan
Services, a division of PNC Bank, National Association, as Servicer on behalf of
Deutsche Bank Trust Company Americas, as Trustee.
8-K
04/21/17
10.12D Fourth Loan and Security Agreement Supplement, dated as of March 9, 2018, by
and among the Borrowers named therein and Midland Loan Services, a division
of PNC Bank, National Association, as Servicer on behalf of Deutsche Bank
Trust Company Americas, as Trustee.
8-K
03/15/18
10.12E Fifth Loan and Security Agreement Supplement, dated as of September 13, 2019,
by and among the Borrowers named therein and Midland Loan Services, a
division of PNC Bank, National Association, as Servicer on behalf of Deutsche
Bank Trust Company Americas, as Trustee.
8-K
09/13/19
10.12F Sixth Loan and Security Agreement Supplement, dated as of July 14, 2020, by
and among the Borrowers named therein and Midland Loan Services, a division
of PNC Bank, National Association, as Servicer on behalf of Deutsche Bank
Trust Company Americas, as Trustee.
8-K
07/20/20
10.12G Seventh Loan and Security Agreement Supplement, dated as of May 14, 2021,
by and among the Borrowers named therein and Midland Loan Services, a
division of PNC Bank, National Association, as Servicer on behalf of Deutsche
Bank Trust Company Americas, as Trustee.
8-K
05/18/21
10.12H Eighth Loan and Security Agreement Supplement, dated as of September 10,
2021, by and among the Borrowers named therein and Midland Loan Services, a
division of PNC Bank, National Association, as Servicer on behalf of Deutsche
Bank Trust Company Americas, as Trustee.
10-K
Year ended December
31, 2022
10.12I Ninth Loan and Security Agreement Supplement, dated as of October 27, 2021,
by and among the Borrowers named therein and Midland Loan Services, a
8-K
10/29/21
53
division of PNC Bank, National Association, as Servicer on behalf of Deutsche
Bank Trust Company Americas, as Trustee.
10.12J Tenth Loan and Security Agreement Supplement, dated November 23, 2022, by
and among the Borrowers named therein and Midland Loan Services, a division
of PNC Bank, National Association, as Servicer on behalf of Deutsche Bank
Trust Company Americas, as Trustee.
8-K
11/29/22
10.12K Eleventh Loan and Security Agreement Supplement, dated October 11, 2024, by
and among the Borrowers named therein and Midland Loan Services, a division
of PNC Bank, National Association, as Servicer on behalf of Deutsche Bank
Trust Company Americas, as Trustee.
8-K
10/11/24
10.50 Management Agreement, dated as of November 18, 2005, by and among SBA
Properties, Inc., SBA Network Management, Inc. and SBA Senior Finance, Inc.
10-K
Year ended December
31, 2005
10.50A Joinder and Amendment to Management Agreement, dated November 6, 2006,
by and among SBA Properties, Inc., SBA Towers, Inc., SBA Puerto Rico, Inc.,
SBA Sites, Inc., SBA Towers USVI, Inc., and SBA Structures, Inc., and SBA
Network Management, Inc., and SBA Senior Finance, Inc.
10-K
Year ended December
31, 2016
10.75B SBA Communications Corporation 2018 Employee Stock Purchase Plan.†
S-8
(333-225139)
05/23/18
10.76 Form of Indemnification Agreement dated January 15, 2009 between SBA
Communications Corporation and its directors and certain officers.
10-K
Year ended December
31, 2008
10.85F Amended and Restated Employment Agreement, dated as of October 1, 2021,
between SBA Communications Corporation and Brendan T. Cavanagh.†
10-K
Year ended December
31, 2022
10.85G Second Amended and Restated Employment Agreement, dated as of February
19, 2024, between SBA Communications Corporation and Brendan T.
Cavanagh.†
10-K
Year ended December
31, 2023
10.89A SBA Communications Corporation 2010 Performance and Equity Incentive Plan,
as amended and restated.†
10-Q
Quarter ended June
30, 2017
10.90 SBA Communications Corporation 2020 Performance and Equity Incentive
Plan.†
10-Q
Quarter ended June
30, 2020
10.91 Form of Incentive Stock Option Agreement (U.S. and non-U.S. employees and
officers) pursuant to SBA Communications Corporation 2010 Performance and
Equity Incentive Plan, as amended and restated.†
10-Q
Quarter ended
September 30, 2018
10.92 Form of Restricted Stock Unit Agreement (U.S. and non-U.S. employees and
officers) pursuant to SBA Communications Corporation 2010 Performance and
Equity Incentive Plan, as amended and restated.†
10-Q
Quarter ended
September 30, 2018
10.95 Purchase Agreement, dated January 21, 2020, between SBA Communications
Corporation and Citigroup Global Markets Inc., as representative of the several
initial purchasers listed on Schedule I thereto.
8-K
02/07/20
10.96 Form of Restricted Stock Unit Agreement (Time and Performance Based)
pursuant to SBA Communications Corporation 2010 Performance and Equity
Incentive Plan.†
10-Q
Quarter ended March
31, 2020
54
10.97 SBA Communications Corporation Executive Severance Plan
10-K
Year ended December
31, 2023
10.98 Form of Restricted Stock Unit Agreement (Time and Performance Based)
pursuant to SBA Communications Corporation 2020 Performance and Equity
Incentive Plan.†*
19.1
SBA Communications Corporation Insider Trading Policy*
21
Subsidiaries.*
23.1
Consent of Ernst & Young LLP.*
31.1
Certification by Brendan T. Cavanagh, Chief Executive Officer, pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2
Certification by Marc Montagner, Chief Financial Officer, pursuant to Section
302 of the Sarbanes-Oxley Act of 2002.*
32.1
Certification by Brendan T. Cavanagh, Chief Executive Officer, pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002. **
32.2
Certification by Marc Montagner, Chief Financial Officer, pursuant to Section
906 of the Sarbanes-Oxley Act of 2002. **
97
SBA Communications Corporation Executive Officer Clawback Policy
10-K
Year ended December
31, 2023
101.INS XBRL Instance Document.*
101.SCH XBRL Taxonomy Extension Schema Document.*
101.DEF XBRL Taxonomy Extension Definition Linkbase Document.*
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document.*
101.LAB XBRL Taxonomy Extension Label Linkbase Document.*
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document.*
104
Cover Page Interactive File (formatted in Inline XBRL and contained in Exhibit
101).*
______________
† Management contract or compensatory plan or arrangement.
* Filed herewith.
** Furnished herewith.
ITEM 16. FORM 10-K SUMMARY
None.
55
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized.
SBA COMMUNICATIONS CORPORATION
By:
/s/ Brendan T. Cavanagh
Brendan T. Cavanagh
Chief Executive Officer and President
Date: February 26, 2025
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the dates indicated.
Signature
Title
Date
/s/ Jeffrey A. Stoops
Chairman of the Board of Directors
February 26, 2025
Jeffrey A. Stoops
/s/ Brendan T. Cavanagh
Chief Executive Officer and President
February 26, 2025
Brendan T. Cavanagh
(Principal Executive Officer)
/s/ Marc Montagner
Chief Financial Officer and Executive Vice President
February 26, 2025
Marc Montagner
(Principal Financial Officer)
/s/ Saul Kredi
Chief Accounting Officer and Vice President
February 26, 2025
Saul Kredi
(Principal Accounting Officer)
/s/ Steven E. Bernstein
Director
February 26, 2025
Steven E. Bernstein
/s/ Mary S. Chan
Director
February 26, 2025
Mary S. Chan
/s/ Laurie Bowen
Director
February 26, 2025
Laurie Bowen
/s/ George R. Krouse Jr.
Director
February 26, 2025
George R. Krouse Jr.
/s/ Jack Langer
Director
February 26, 2025
Jack Langer
/s/ Kevin L. Beebe
Director
February 26, 2025
Kevin L. Beebe
/s/ Amy E. Wilson
Director
February 26, 2025
Amy E. Wilson
/s/ Jay L. Johnson
Director
February 26, 2025
Jay L. Johnson
SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
Table of Contents
Page
Report of Independent Registered Public Accounting Firm (PCAOB ID: 42)
F-1
Consolidated Balance Sheets as of December 31, 2024 and 2023
F-3
Consolidated Statements of Operations for the years ended December 31, 2024, 2023, and 2022
F-4
Consolidated Statements of Comprehensive Income for the years ended December 31, 2024, 2023, and 2022
F-5
Consolidated Statements of Shareholders’ Deficit for the years ended December 31, 2024, 2023, and 2022
F-6
Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023, and 2022
F-7
Notes to Consolidated Financial Statements
F-9
F-1
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of SBA Communications Corporation
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of SBA Communications Corporation and subsidiaries (the Company) as of
December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income, shareholders' deficit and cash flows
for each of the three years in the period ended December 31, 2024, and the related notes and financial statement schedule listed in the Index at
Item 15(a)(2) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present
fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its
cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the
Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated
February 26, 2025 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s
financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with
respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and
Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included
performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in
the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as
well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated
or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements
and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in
any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter
below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
F-2
Accounting for Ground Leases
Description of
the Matter
As more fully described in Note 2 to the consolidated financial statements, the Company recognizes a right-of-use asset and
a lease liability for its operating lease contracts, initially measured at the present value of the lease payments over the lease
term. As of December 31, 2024, the Company had $2.3 billion of operating lease right-of-use assets, net, $259.8 million of
current operating lease liabilities, and $1.9 billion of long-term lease liabilities. For the period ended December 31, 2024,
the total operating lease right-of-use assets obtained for new operating lease liabilities were $59.2 million, and operating
lease right-of-use asset adjustments associated with lease modifications and reassessments were $268.5 million. The
Company’s primary operating lease obligations are its long-term lease contracts for land that underlies its tower structures.
The Company’s ground leases generally do not provide a readily determinable implicit discount rate. When the rate implicit
in the lease is not readily determinable, the Company calculates the present value of the lease payments by estimating the
Company’s incremental borrowing rate (“IBR”). The IBR is the rate of interest that the Company would have to pay to
borrow on a collateralized basis over a similar term in a similar economic environment. The IBR is computed on a lease-by-
lease basis when the Company enters into a new lease, upon a lease modification, or upon a lease reassessment event.
Auditing the Company’s accounting for ground leases was complex because of the significant uncertainty associated with
inputs into the IBR. The process to estimate the Company’s IBR includes the use of subjective inputs, considers the public
credit rating of the Company, observable debt yields of the Company and the related debt’s seniority, and adjustments for
leases denominated in different currencies, to determine the IBR over the remaining lease term.
How We
Addressed the
Matter in Our
Audit
We obtained an understanding, evaluated and tested the design and operating effectiveness of the Company’s internal
controls related to determining the IBR used in accounting for ground leases. For example, we tested the Company’s controls
over the review of the accounting policy, including the methodology and assumptions used to estimate the IBR.
To test the Company’s accounting for ground leases, our audit procedures included, among others, evaluating the
methodology used to calculate the IBR, and evaluating the assumptions and underlying data used by the Company to estimate
the IBR. We involved our valuation specialists to assist in the evaluation of the methodologies and assumptions applied to
estimate the IBR. We compared the Company’s credit rating used in the IBR estimate to independent third-party sources
and compared the Company’s existing borrowing rate for collateralized assets to observable debt yields of the Company.
We also evaluated the Company’s disclosures included in Note 2 to the consolidated financial statements.
/s/ Ernst & Young LLP
We have served as the Company’s auditor since 2002.
Boca Raton, Florida
February 26, 2025
F-3
SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except par values)
December 31,
December 31,
2024
2023
ASSETS
Current assets:
Cash and cash equivalents
$
189,841
$
208,547
Restricted cash
1,206,653
38,129
Accounts receivable, net
145,695
182,746
Costs and estimated earnings in excess of billings on uncompleted contracts
19,198
16,252
Prepaid expenses and other current assets
417,333
38,593
Total current assets
1,978,720
484,267
Property and equipment, net
2,792,084
2,711,719
Intangible assets, net
2,388,707
2,455,597
Operating lease right-of-use assets, net
2,292,459
2,240,781
Acquired and other right-of-use assets, net
1,308,269
1,473,601
Other assets
657,097
812,476
Total assets
$
11,417,336
$
10,178,441
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS,
AND SHAREHOLDERS' DEFICIT
Current liabilities:
Accounts payable
$
59,549
$
42,202
Accrued expenses
81,977
92,622
Current maturities of long-term debt
1,187,913
643,145
Deferred revenue
127,308
235,668
Accrued interest
62,239
57,496
Current lease liabilities
261,017
273,464
Other current liabilities
17,933
18,662
Total current liabilities
1,797,936
1,363,259
Long-term liabilities:
Long-term debt, net
12,403,825
11,681,170
Long-term lease liabilities
1,903,439
1,865,686
Other long-term liabilities
367,942
404,161
Total long-term liabilities
14,675,206
13,951,017
Redeemable noncontrolling interests
54,132
35,047
Shareholders' deficit:
Preferred stock - par value $0.01, 30,000 shares authorized, no shares issued or outstanding
—
—
Common stock - Class A, par value $0.01, 400,000 shares authorized, 107,561 shares and
108,050 shares issued and outstanding at December 31, 2024 and December 31, 2023,
respectively
1,076
1,080
Additional paid-in capital
2,975,455
2,894,060
Accumulated deficit
(7,326,189)
(7,450,824)
Accumulated other comprehensive loss, net
(760,280)
(615,198)
Total shareholders' deficit
(5,109,938)
(5,170,882)
Total liabilities, redeemable noncontrolling interests, and shareholders' deficit
$
11,417,336
$
10,178,441
The accompanying notes are an integral part of these consolidated financial statements.
F-4
SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
For the year ended December 31,
2024
2023
2022
Revenues:
Site leasing
$
2,526,765
$
2,516,935
$
2,336,575
Site development
152,869
194,649
296,879
Total revenues
2,679,634
2,711,584
2,633,454
Operating expenses:
Cost of revenues (exclusive of depreciation, accretion,
and amortization shown below):
Cost of site leasing
462,997
472,687
445,685
Cost of site development
118,730
139,935
222,965
Selling, general, and administrative expenses
258,756
267,936
261,853
Acquisition and new business initiatives related
adjustments and expenses
25,946
21,671
26,807
Asset impairment and decommission costs
107,925
169,387
43,160
Depreciation, accretion, and amortization
269,517
716,309
707,576
Total operating expenses
1,243,871
1,787,925
1,708,046
Operating income
1,435,763
923,659
925,408
Other income (expense):
Interest income
41,962
18,305
10,133
Interest expense
(399,778)
(400,373)
(353,784)
Non-cash interest expense
(27,661)
(35,868)
(46,109)
Amortization of deferred financing fees
(21,265)
(20,273)
(19,835)
Loss from extinguishment of debt, net
(5,940)
—
(437)
Other (expense) income, net
(250,415)
63,053
10,467
Total other expense, net
(663,097)
(375,156)
(399,565)
Income before income taxes
772,666
548,503
525,843
Provision for income taxes
(23,989)
(51,088)
(66,044)
Net income
748,677
497,415
459,799
Net loss attributable to noncontrolling interests
859
4,397
1,630
Net income attributable to SBA Communications
Corporation
$
749,536 $
501,812
$
461,429
Net income per common share attributable to SBA
Communications Corporation:
Basic
$
6.96
$
4.64
$
4.27
Diluted
$
6.94
$
4.61
$
4.22
Weighted-average number of common shares
Basic
107,644
108,204
107,957
Diluted
108,080
108,907
109,386
The accompanying notes are an integral part of these consolidated financial statements.
F-5
SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)
For the year ended December 31,
2024
2023
2022
Net income
$
748,677
$
497,415
$
459,799
Adjustments related to interest rate swaps
(617)
(68,133)
167,423
Foreign currency translation adjustments
(143,847)
42,546
4,172
Comprehensive income
604,213
471,828
631,394
Comprehensive loss attributable to noncontrolling interests
241
5,296
1,834
Comprehensive income attributable to SBA
Communications Corporation
$
604,454
$
477,124
$
633,228
The accompanying notes are an integral part of these consolidated financial statements.
F-6
SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ DEFICIT
(in thousands)
Total Shareholders' Equity (Deficit)
Accumulated
Class A
Additional
Other
Total
Common Stock
Paid-In
Accumulated
Comprehensive
Shareholders'
Shares
Amount
Capital
Deficit
Loss, Net
Deficit
BALANCE, December 31, 2021
108,956
$
1,089
$ 2,681,347
$
(7,203,531) $
(762,309) $
(5,283,404)
Net income attributable to SBA
Communications Corporation
—
—
—
461,429
—
461,429
Common stock issued in connection with equity
awards and stock purchase plans, offset
by the impact of net share settlements
341
3
28,302
—
—
28,305
Non-cash stock compensation
—
—
101,846
—
—
101,846
Adjustments related to interest rate swaps
—
—
—
—
167,423
167,423
Repurchase and retirement of common stock
(1,300)
(12)
—
(431,654)
—
(431,666)
Foreign currency translation adjustments
attributable to SBA Communications
Corporation
—
—
—
—
4,376
4,376
Dividends and dividend equivalents
on common stock
—
—
—
(308,305)
—
(308,305)
Adjustment to redemption amount related to
noncontrolling interests
—
—
(16,319)
—
—
(16,319)
BALANCE, December 31, 2022
107,997
1,080
2,795,176
(7,482,061)
(590,510)
(5,276,315)
Net income attributable to SBA
Communications Corporation
—
—
—
501,812
—
501,812
Common stock issued in connection with equity
awards and stock purchase plans, offset
by the impact of net share settlements
558
5
16,710
—
—
16,715
Non-cash stock compensation
—
—
89,582
—
—
89,582
Adjustments related to interest rate swaps
—
—
—
—
(68,133)
(68,133)
Repurchase and retirement of common stock
(505)
(5)
—
(100,005)
—
(100,010)
Foreign currency translation adjustments
attributable to SBA Communications
Corporation
—
—
—
—
43,445
43,445
Dividends and dividend equivalents
on common stock
—
—
—
(370,570)
—
(370,570)
Adjustment to redemption amount related to
noncontrolling interests
—
—
(7,408)
—
—
(7,408)
BALANCE, December 31, 2023
108,050
1,080
2,894,060
(7,450,824)
(615,198)
(5,170,882)
Net income attributable to SBA
Communications Corporation
—
—
—
749,536
—
749,536
Common stock issued in connection with equity
awards and stock purchase plans, offset
by the impact of net share settlements
446
5
17,130
—
—
17,135
Non-cash stock compensation
—
—
75,996
—
—
75,996
Adjustments related to interest rate swaps
—
—
—
—
(617)
(617)
Repurchase and retirement of common stock
(935)
(9)
—
(200,010)
—
(200,019)
Foreign currency translation adjustments
attributable to SBA Communications
Corporation
—
—
—
—
(144,465)
(144,465)
Dividends and dividend equivalents
on common stock
—
—
—
(424,891)
—
(424,891)
Adjustment to redemption amount related to
noncontrolling interests
—
—
(11,731)
—
—
(11,731)
BALANCE, December 31, 2024
107,561 $
1,076 $
2,975,455 $
(7,326,189) $
(760,280) $
(5,109,938)
The accompanying notes are an integral part of these consolidated financial statements.
F-7
SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
For the year ended December 31,
2024
2023
2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income
$
748,677
$
497,415
$
459,799
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, accretion, and amortization
269,517
716,309
707,576
Non-cash asset impairment and decommission costs
91,279
154,947
42,807
Non-cash compensation expense
74,374
87,919
99,909
Loss (gain) on remeasurement of U.S. denominated intercompany loans
236,467
(81,222)
(20,295)
Loss from extinguishment of debt, net
5,940
—
437
Deferred income tax (benefit) expense
(13,087)
4,629
32,901
Non-cash interest expense
27,661
35,868
46,109
Amortization of deferred financing fees
21,265
20,273
19,835
Other non-cash items reflected in the Statements of Operations
15,829
43,785
9,742
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable and costs and estimated earnings in excess of
billings on uncompleted contracts, net
18,109
44,386
(81,351)
Prepaid expenses and other assets
(19,480)
(35,498)
(29,746)
Operating lease right-of-use assets, net
127,182
141,114
135,473
Accounts payable and accrued expenses
(4,402)
(66,324)
25,118
Long-term lease liabilities
(141,214)
(138,699)
(129,471)
Other liabilities
(123,251)
119,491
(33,143)
Net cash provided by operating activities
1,334,866
1,544,393
1,285,700
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions
(299,811)
(129,961)
(1,176,092)
Capital expenditures
(228,149)
(236,698)
(214,443)
Purchase of investments
(1,800,683)
(1,339,026)
(881,781)
Proceeds from sale of investments
1,536,750
1,338,354
878,138
Loan to unconsolidated joint venture
(11,100)
(100,494)
—
Other investing activities
(6,317)
(421)
524
Net cash used in investing activities
(809,310)
(468,246)
(1,393,654)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under Revolving Credit Facility
370,000
190,000
975,000
Repayments under Revolving Credit Facility
(550,000)
(730,000)
(605,000)
Proceeds from issuance of Term Loans, net of fees
2,280,565
—
—
Repayment of Term Loans
(2,292,244)
(24,000)
(24,000)
Proceeds from issuance of Tower Securities, net of fees
2,052,136
—
839,885
Repayment of Tower Securities
(620,269)
—
(640,000)
Repurchase and retirement of common stock
(200,019)
(100,010)
(431,666)
Payment of dividends on common stock
(424,191)
(369,960)
(306,766)
Proceeds from employee stock purchase/stock option plans
35,986
44,196
38,303
Payments related to taxes on stock options and restricted stock units
(18,801)
(27,481)
(9,958)
Other financing activities
12,579
37
28,728
Net cash provided by (used in) financing activities
645,742
(1,017,218)
(135,474)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
(21,587)
2,734
(2,915)
NET CHANGE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH
1,149,711
61,663
(246,343)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH:
Beginning of year
250,946
189,283
435,626
End of year
$
1,400,657
$
250,946
$
189,283
(continued)
F-8
SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
For the year ended December 31,
2024
2023
2022
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest
$
395,112 $
396,593 $
347,659
Income taxes
$
42,415 $
25,581 $
32,320
SUPPLEMENTAL CASH FLOW INFORMATION OF NON-CASH
ACTIVITIES:
Right-of-use assets obtained in exchange for new operating lease liabilities
$
59,189 $
55,409 $
171,203
Operating lease modifications and reassessments
$
268,531 $
(36,539) $
48,946
Right-of-use assets obtained in exchange for new finance lease liabilities
$
336 $
1,954 $
3,860
The accompanying notes are an integral part of these consolidated financial statements.
F-9
SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1.
GENERAL
SBA Communications Corporation (the “Company” or “SBAC”) was incorporated in the State of Florida in March 1997. The
Company is a holding company that holds all of the outstanding capital stock of SBA Telecommunications, LLC
(“Telecommunications”). Telecommunications is a holding company that holds the outstanding capital stock of SBA Senior Finance,
LLC (“SBA Senior Finance”), and other operating subsidiaries which are not a party to any loan agreement. SBA Senior Finance is a
holding company that holds, directly or indirectly, the equity interest in certain subsidiaries that issued the Tower Securities (see Note
11) and certain subsidiaries that were not involved in the issuance of the Tower Securities. With respect to the subsidiaries involved in
the issuance of the Tower Securities, SBA Senior Finance is the sole member of SBA Holdings, LLC and SBA Depositor, LLC. SBA
Holdings, LLC is the sole member of SBA Guarantor, LLC. SBA Guarantor, LLC directly or indirectly holds all of the capital stock of
the companies referred to as the “Borrowers” under the Tower Securities. With respect to subsidiaries not involved in the issuance of
the Tower Securities, SBA Senior Finance holds all of the membership interests in SBA Senior Finance II, LLC (“SBA Senior
Finance II”) and certain non-operating subsidiaries. SBA Senior Finance II holds, directly or indirectly, all the capital stock of certain
international subsidiaries and certain other tower companies (known as “Tower Companies”). SBA Senior Finance II also holds,
directly or indirectly, all the capital stock and/or membership interests of certain other subsidiaries involved in providing services,
including SBA Network Services, LLC (“Network Services”) as well as SBA Network Management, Inc. (“Network Management”)
which manages and administers the operations of the Borrowers.
As of December 31, 2024, the Company owned and operated wireless towers in the United States and its territories. In
addition, the Company owned towers in Brazil, Canada, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Nicaragua,
Panama, Peru, South Africa, the Philippines, and Tanzania. Space on these towers is leased primarily to wireless service providers. On
January 10, 2025, the Company completed the sale of all its towers and ended its operations in the Philippines and on February 20,
2025, the Company entered into an agreement to sell all of its towers and related assets held in Colombia. As of December 31, 2024,
the Company owned and operated 39,749 towers of which 17,464 are domestic and 22,285 are international, of which 12,520 are
located in Brazil.
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A summary of the significant accounting policies applied in the preparation of the accompanying consolidated financial
statements is as follows:
Principles of Consolidation
The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the
United States of America (“U.S. GAAP”) and include the Company and its majority and wholly-owned subsidiaries. All significant
intercompany accounts and transactions have been eliminated in consolidation.
Reclassification
Certain prior year amounts have been reclassified to conform with the current year presentation.
Use of Estimates
The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make
estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The
significant estimates made by management relate to the allowance for doubtful accounts, the costs and revenue relating to the
Company’s construction contracts, stock-based compensation assumptions, valuation allowance related to deferred tax assets, fair
value of long-lived assets, the useful lives of towers and intangible assets, anticipated property tax assessments, incremental borrowing
rate for lease accounting, fair value of investments, and asset retirement obligations. Management develops estimates based on
historical experience and on various assumptions about the future that are believed to be reasonable based on the information
available. These estimates ultimately may differ from actual results and such differences could be material.
During the first quarter of 2024, the Company completed its assessment on the remaining estimated useful lives of its towers
and intangible assets. The Company concluded through its assessment that, for U.S. GAAP purposes, it should modify its current
estimates for asset lives based on its historical operating experience and the findings obtained by its independent consultant. The
Company previously depreciated its towers on a straight-line basis over the shorter of the (i) term of the underlying ground lease
F-10
(including renewal options) taking into account residual value or (ii) estimated useful life of a tower, which the Company had
historically estimated to be 15 years. Based on its assessment, the Company revised the estimated useful lives of its towers and certain
related intangible assets (which are amortized on a similar basis to its tower assets, as their useful lives correlate to the useful life of
the towers) from 15 years to 30 years, effective January 1, 2024. The Company accounted for the change in estimated useful lives as a
change in estimate under ASC 250 “Accounting Changes and Error Corrections.” The impact of the change in estimate was accounted
for prospectively effective January 1, 2024, resulting in a reduction in depreciation and amortization expense of approximately $411.5
million ($372.5 million after tax, or an increase of $3.45 per diluted share) for the year ended December 31, 2024.
Cash and Cash Equivalents
Cash and cash equivalents consist primarily of cash in banks, commercial paper, highly liquid short-term investments, and
other marketable securities with an original maturity of three months or less at the time of purchase. These investments are carried at
cost, which approximates fair value.
Restricted Cash
The Company classifies all cash pledged as collateral to secure certain obligations and all cash whose use is limited as
restricted cash. This includes cash held in escrow to fund certain reserve accounts relating to the Tower Securities as well as for
payment and performance bonds and surety bonds issued for the benefit of the Company in the ordinary course of business, as well as
collateral associated with workers’ compensation plans (see Note 4).
Investments
Investment securities with original maturities of more than three months but less than one year at time of purchase are
considered short-term investments and are classified in prepaid expenses and other current assets on the accompanying Consolidated
Balance Sheets. The Company’s short-term investments primarily consist of money market funds. Investment securities with
maturities of more than a year are considered long-term investments and are classified in other assets on the accompanying
Consolidated Balance Sheets. Long-term investments consist of strategic investments in companies and are accounted for under the
cost and equity method. Gross purchases and proceeds from sales of the Company’s investments are presented within Cash flows from
investing activities on the Company’s Consolidated Statements of Cash Flows. During the years ended December 31, 2024 and 2023,
no gain or loss was recorded related to the sale or maturity of investments.
Property and Equipment
Property and equipment are recorded at cost or at estimated fair value (in the case of acquired properties), adjusted for asset
impairment and estimated asset retirement obligations. Costs for self-constructed towers include direct materials and labor, indirect
costs and capitalized interest. Approximately $0.8 million, $0.9 million, and $0.6 million of interest cost was capitalized in 2024, 2023
and 2022, respectively.
Depreciation on towers and related components is provided using the straight-line method over the estimated useful lives, not
to exceed the minimum lease term of the underlying ground lease after consideration of residual value. To determine the lease term,
the Company considers all renewal periods that are reasonably certain to be exercised, taking into consideration all economic factors,
including the communications site’s estimated economic life and the respective lease terms of the Company’s tenants under the
existing lease arrangements on such site. Leasehold improvements are amortized on a straight-line basis over the shorter of the useful
life of the improvement or the minimum lease term of the lease. For all other property and equipment, depreciation is provided using
the straight-line method over the estimated useful lives.
The Company performs ongoing evaluations of the estimated useful lives of its property and equipment for depreciation
purposes. The estimated useful lives are determined and continually evaluated based on the period over which services are expected to
be rendered by the asset. If the useful lives of assets are reduced, depreciation may be accelerated in future years. Property and
equipment under capital leases are amortized on a straight-line basis over the term of the lease, after consideration of residual value, or
the remaining estimated life of the leased property, whichever is shorter, and the related amortization is included in depreciation
expense. Expenditures for maintenance and repair are expensed as incurred.
F-11
Asset classes and related estimated useful lives are as follows:
Towers and related components
3 - 30 years
Furniture, equipment, and vehicles
2 - 7 years
Data Centers, buildings, and leasehold improvements
10 - 40 years
Betterments, improvements, and significant repairs, which increase the value or extend the life of an asset, are capitalized and
depreciated over the estimated useful life of the respective asset. Changes in an asset’s estimated useful life are accounted for
prospectively, with the book value of the asset at the time of the change being depreciated over the revised remaining useful life.
There has been no material impact for changes in estimated useful lives for any years presented other than the change of useful lives
of the Company’s towers from 15 years to 30 years effective January 1, 2024, as discussed above.
Deferred Financing Fees
Financing fees related to the issuance of debt have been deferred and are being amortized using the effective interest rate
method over the expected duration of the related indebtedness (see Note 11). For all of the Company’s debt, except for the Revolving
Credit Facility where the debt issuance costs are being presented as an asset on the accompanying Consolidated Balance Sheets, debt
issuance costs are presented on the balance sheet as a direct deduction from the related debt liability rather than as an asset.
Intangible Assets
The Company classifies as intangible assets the fair value of current leases in place at the acquisition date of towers and
related intangible assets (referred to as the “Current contract intangibles”), and the fair value of future tenant leases anticipated to be
added to the acquired towers (referred to as the “Network location intangibles”). These intangibles are estimated to have a useful life
consistent with the useful life of the related tower assets, which is typically 30 years. For all intangible assets, amortization is provided
using the straight-line method over the estimated useful lives as the benefit associated with these intangible assets is anticipated to be
derived evenly over the life of the asset.
Impairment of Long-Lived Assets
The Company evaluates its individual long-lived and related assets with finite lives for indicators of impairment to determine
when an impairment analysis should be performed. The Company evaluates its tower and related assets at the tower level, which is the
lowest level for which identifiable cash flows exists. The Company evaluates its Network location intangibles for impairment at the
tower leasing business level. The Company has established a policy to at least annually, or earlier if indicators of impairment arise,
evaluate its tower assets and Current contract and Network location intangibles for impairment.
The Company performs its evaluation for impairment by first calculating the future undiscounted cash flows of its
investments in towers and related assets and comparing those amounts to the carrying value of the assets. If the future undiscounted
cash flows are lower than the carrying value of the investment in the tower and related assets, the Company calculates the future
discounted cash flows and compares those amounts to the carrying value. The Company records an impairment charge for any
amounts lower than the carrying value. Estimates and assumptions inherent in the impairment evaluation include, but are not limited
to, general market and economic conditions, historical operating results, geographic location, lease-up potential, and expected timing
of lease-up. In addition, the Company makes certain assumptions in determining an asset’s fair value for the purpose of calculating the
amount of an impairment charge.
The Company recognized impairment charges of $107.9 million, $169.4 million, and $43.2 million for the years ended
December 31, 2024, 2023 and 2022, respectively. Refer to Note 3 for further detail of these amounts.
F-12
Fair Value Measurements
The Company determines the fair market values of its financial instruments based on the fair value hierarchy, which requires
an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The
following three levels of inputs may be used to measure fair value:
Level 1
Quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the
measurement date.
Level 2
Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in
markets that are not active; or other inputs that are observable or can be corroborated by observable market data for
substantially the full term of the assets or liabilities.
Level 3
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the
assets or liabilities.
Revenue Recognition and Accounts Receivable
Site leasing revenues
Revenue from site leasing is recognized on a straight-line basis over the current term of the related lease agreements.
Receivables recorded related to the straight-line impact of site leases are reflected in other assets on the Consolidated Balance Sheets.
Rental amounts received in advance are recorded as deferred revenue on the Consolidated Balance Sheets. Revenues from site leasing
represent 94% of the Company’s total revenues for the year ended December 31, 2024. For additional information on tenant leases,
refer to the Leases section below.
Site development revenues
Site development projects in which the Company performs consulting services include contracts on a fixed price basis that
are billed at contractual rates. Revenue is recognized over time based on milestones achieved, which are determined based on costs
incurred. Amounts billed in advance (collected or uncollected) are recorded as deferred revenue on the Consolidated Balance Sheets.
Revenue from construction projects is recognized over time, determined by the percentage of cost incurred to date compared
to management’s estimated total cost for each contract. This method is used because management considers total cost to be the best
available measure of progress on the contracts. These amounts are based on estimates, and the uncertainty inherent in the estimates
initially is reduced as work on the contracts nears completion. Refer to Note 5 for further detail of costs and estimated earnings in
excess of billings on uncompleted contracts. Provisions for estimated losses on uncompleted contracts are made in the period in which
such losses are determined to be probable.
The site development segment represents approximately 6% of the Company’s total revenues for the year ended December
31, 2024. The Company accounts for site development revenue in accordance with ASC 606, Revenue from Contracts with
Customers. Payment terms do not result in any significant financing arrangements. Furthermore, these contracts do not typically
include variable consideration; therefore, the transaction price that is recognized over time is generally the amount of the total
contract.
Accounts receivable
The accounts receivable balance was $145.7 million and $182.7 million as of December 31, 2024 and 2023, respectively, of
which $26.4 million and $32.3 million related to the site development segment as of December 31, 2024 and 2023, respectively. Refer
to Note 15 for further detail of the site development segment.
Credit Losses
The Company’s expected credit loss allowance methodology for accounts receivable is developed using historical collection
experience, current and future economic and market conditions, and a review of the current status of customers’ trade accounts
receivables. Due to the short-term nature of such receivables, the estimate of the amount of accounts receivable that may not be
collected considers aging of the accounts receivable balances and the financial condition of customers. Additionally, specific
allowance amounts are established to record the appropriate provision for customers that have a higher probability of default. The
Company’s monitoring activities include timely account reconciliation, dispute resolution, payment confirmation, consideration of
F-13
customers’ financial condition, and macroeconomic conditions. Balances are written off when determined to be uncollectible. The
Company is exposed to credit losses primarily through the site development business segment which provides consulting and
construction related services.
The following is a rollforward of the allowance for doubtful accounts for the Company’s site leasing and site development
businesses:
For the year ended December 31,
2024
2023
2022
(in thousands)
Beginning balance
$
12,838
$
9,166
$
12,135
Provision for doubtful accounts (1)
3,680
3,731
632
Write-offs
(637)
(220)
(1,793)
Recoveries (2)
—
—
(2,204)
Acquisitions
—
—
116
Currency translation adjustment
(1,194)
161
280
Ending balance
$
14,687
$
12,838
$
9,166
(1)
The year ended December 31, 2023 includes a $3.1 million reserve recorded related to Oi S.A.
(2)
Amounts include annual installment payments related to the Oi S.A. reorganization. The fourth and final annual installment
payment was received during the year ended December 31, 2022.
Cost of Revenue
Cost of site leasing revenue includes ground lease rent, property taxes, amortization of deferred lease costs, maintenance,
fuel, energy, and other tower operating expenses. Cost of site development revenue includes the cost of materials, salaries, and labor
costs, including payroll taxes, subcontract labor, vehicle expense, and other costs directly and indirectly related to the projects. All
costs related to site development projects are recognized as incurred.
Income Taxes
The Company recognizes deferred tax assets and liabilities for the estimated future tax consequences attributable to
differences between the financial reporting and tax bases of existing assets and liabilities. Deferred tax assets and liabilities are
measured using tax rates in effect for the year in which the temporary differences are expected to reverse. A valuation allowance is
recorded to reduce the carrying amounts of deferred tax assets if it is "more-likely-than-not" that those assets will not be realized. The
Company considers many factors when assessing the likelihood of future realization, including the Company’s recent cumulative
earnings by taxing jurisdiction, expectations of future taxable income, prudent and feasible tax planning strategies that are available,
the carryforward periods available to the Company for tax reporting purposes and other relevant factors.
The Company began operating as a REIT for federal income tax purposes effective January 1, 2016. As a REIT, the
Company generally is not subject to corporate level federal income tax on taxable income it distributes to its stockholders as long as it
meets the organizational and operational requirements under the REIT rules. However, certain subsidiaries have made an election with
the IRS to be treated as a taxable REIT subsidiary (“TRS”) in conjunction with the Company's REIT election. The TRS elections
permit the Company to engage in certain business activities in which the REIT may not engage directly, so long as these activities are
conducted in entities that elect to be treated as TRSs under the Code. A TRS is subject to federal and state income taxes on the income
from these activities. Additionally, the Company has included in TRSs the Company’s tower operations in most foreign jurisdictions;
however, the REIT holds selected tower assets in certain foreign jurisdictions. Those operations will continue to be subject to foreign
taxes in the jurisdiction in which such assets and operations are located regardless of whether they are included in a TRS.
The Company will continue to file separate federal tax returns for the REIT and TRS for the year ended December 31, 2024.
The REIT had taxable income during the year ended December 31, 2024 and paid a dividend and utilized net operating losses
(“NOLs”) to offset its remaining 2024 distribution requirement. Some of the Company’s TRSs generated NOLs which will be carried
forward to use in future years. A portion of the deferred tax asset generated by the NOLs are reserved by a valuation allowance.
Stock-Based Compensation
The Company measures and recognizes compensation expense for all share-based payment awards made to employees and
directors, including stock options, restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”), and purchases
F-14
under the Company’s employee stock purchase plans. The Company records compensation expense for stock options, RSUs, and
PSUs on a straight-line basis over the vesting period; however, compensation expense related to certain PSUs are subject to
adjustment on performance relative to the established targets. Compensation expense for stock options is based on the estimated fair
value of the options on the date of the grant using the Black-Scholes option-pricing model. Compensation expense for RSUs and PSUs
is based on the fair market value of the units awarded at the date of the grant. Fair value for a portion of the PSUs was calculated using
a Monte Carlo simulation model.
Asset Retirement Obligations
The Company has entered into ground leases for the land underlying the majority of the Company’s towers. A majority of
these leases require the Company to remove improvements only or restore land interests to their original condition upon termination of
the ground lease.
In determining the measurement of the asset retirement obligations, the Company considered the nature and scope of the
contractual restoration obligations contained in the Company’s ground leases, the historical retirement experience as an indicator of
future restoration probabilities, intent in renewing existing ground leases through lease termination dates, current and future value,
timing of estimated restoration costs, and the credit adjusted risk-free rate used to discount future obligations.
The Company recognizes asset retirement obligations in the period in which they are incurred, if a reasonable estimate of a
fair value can be made. The associated asset retirement costs are capitalized as part of the carrying amount of the related tower fixed
assets, and over time, the liability is accreted to its present value each period and the capitalized cost is depreciated over the estimated
useful life of the tower. As of December 31, 2024 and 2023, the asset retirement obligation was $140.9 million and $119.3 million,
respectively, and is included in other long-term liabilities on the Consolidated Balance Sheets. Upon settlement of the obligations, any
difference between the cost to retire an asset and the recorded liability is recorded in Asset impairment and decommission costs on the
Consolidated Statements of Operations.
Comprehensive Income
Comprehensive income is defined as the change in equity (net assets) of a business enterprise during a period from
transactions and other events and circumstances from non-owner sources, and is comprised of net income, foreign currency translation
adjustments, and adjustments related to interest rate swaps designated as cash flow hedges.
Foreign Currency Translation
All assets and liabilities of foreign subsidiaries that do not utilize the U.S. dollar as its functional currency are translated at
period-end exchange rates, while revenues and expenses are translated at monthly average exchange rates during the year. Unrealized
translation gains and losses are reported as foreign currency translation adjustments through Accumulated other comprehensive loss,
net in the Consolidated Statement of Shareholders’ Deficit.
For foreign subsidiaries where the U.S. dollar is the functional currency, monetary assets and liabilities of such subsidiaries,
which are not denominated in U.S. dollars, are remeasured at exchange rates in effect at the balance sheet date, and revenues and
expenses are remeasured at monthly average rates prevailing during the year. Remeasurement gains and losses are reported as Other
(expense) income, net in the Consolidated Statements of Operations.
Intercompany Loans Subject to Remeasurement
In accordance with ASC 830, the Company remeasures foreign denominated intercompany loans with the corresponding
change in the balance being recorded in Other (expense) income, net in the Consolidated Statements of Operations as settlement is
anticipated or planned in the foreseeable future. The Company recorded a $156.8 million loss, a $52.4 million gain, and a $12.9
million gain, net of taxes, on the remeasurement of intercompany loans for the years ended December 31, 2024, 2023, and 2022,
respectively. During the year ended December 31, 2024, the Company funded $9.3 million and repaid $177.1 million under its
intercompany loan agreements. As of December 31, 2024 and 2023, the aggregate amount outstanding under the intercompany loan
agreements subject to remeasurement with the Company’s foreign subsidiaries was $1.1 billion and $1.3 billion, respectively.
Subsequent to December 31, 2024, the Company made no repayments under its intercompany loan agreements.
F-15
Acquisitions
The Company’s acquisitions generally qualify for asset acquisition treatment under ASC 360, Property, Plant, and
Equipment, rather than business combination treatment under ASC 805, Business Combinations. For acquisitions, the aggregate
purchase price is allocated on a relative fair value basis to towers and related intangible assets. The fair values of these net assets
acquired are based on management’s estimates and assumptions, as well as other information compiled by management, including
valuations that utilize customary valuation procedures and techniques. The fair value estimates are based on available historical
information and on future expectations and assumptions deemed reasonable by management at the time. If the actual results differ
from the estimates and judgments used in these fair values, the amounts recorded in the consolidated financial statements could be
subject to a possible impairment of the intangible assets or require acceleration of the amortization expense of intangible assets in
subsequent periods. External, direct transaction costs will be capitalized as a component of the cost of the asset acquired. The
Company will continue to expense internal acquisition costs as incurred. For business combinations, the estimates of the fair value of
the assets acquired and liabilities assumed at the date of an acquisition are subject to adjustment during the measurement period (up to
one year from the particular acquisition date). During the measurement period, the Company will adjust assets and/or liabilities if new
information is obtained about facts and circumstances that existed as of the acquisition date that, if known, would have resulted in a
revised estimated value of those assets and/or liabilities as of that date. As of December 31, 2024, there were no material acquisitions
with purchase price allocations that were preliminary.
In connection with certain acquisitions, the Company may agree to pay contingent consideration (or earnouts) in cash or
stock if the communication sites or businesses that are acquired meet or exceed certain performance targets over a period of one year
to three years after they have been acquired. Contingent consideration in connection with asset acquisitions will be recognized at the
time when the contingency is resolved or becomes payable and will increase the cost basis of the assets acquired.
Leases
ASC 842, Leases, requires all lessees to recognize a right-of-use asset and a lease liability, initially measured at the present
value of the lease payments and any prepaid rent amounts. The Company has elected not to separate nonlease components from the
associated lease component for all underlying classes of assets.
The components of the right-of-use lease liabilities as of December 31, 2024 and 2023 are as follows (in thousands):
December 31,
December 31,
2024
2023
(in thousands)
Current operating lease liabilities
$
259,765
$
271,793
Current financing lease liabilities
1,252
1,671
Current lease liabilities
$
261,017
$
273,464
Long-term operating lease liabilities
$
1,901,554
$
1,862,509
Long-term financing lease liabilities
1,885
3,177
Long-term lease liabilities
$
1,903,439
$
1,865,686
Operating Leases
Ground leases. The Company enters into long-term lease contracts for land that underlies its tower structures. Ground lease
agreements generally include renewal options which can be exercised exclusively at the Company’s election. To determine the lease
term, the Company considers all renewal periods that are reasonably certain to be exercised, taking into consideration all economic
factors, including the communications site’s estimated economic life and the respective lease terms of the Company’s tenants under
the existing lease arrangements on such site.
Substantially all leases provide for rent rate escalations. In the United States and the Company’s international markets,
ground leases and other property interests typically either (1) contain specific annual rent escalators or (2) escalate annually in
accordance with an inflationary index. Increases or decreases in lease payments that result from subsequent changes in the index or
rate are accounted for as variable lease payments.
Office leases. The Company’s office leases consist of long-term leases for international, regional, and certain site
development office locations. Office leases include a single lease component, lease of the office space, and sometimes nonlease
F-16
components such as common area maintenance expenses. The lease term for office leases are generally considered to be the
contractually committed term.
Finance Leases
Vehicle leases. The Company leases vehicles that are used in its site development business. These leases are generally
accounted for as financing leases and have lease terms that are contractually committed and do not include optional renewal terms.
Acquired right-of-use assets. In connection with certain acquisitions, the Company may acquire the exclusive right to lease
and operate communication sites for a period that represents (1) a major part of the remaining economic life of the underlying assets
and/or (2) the purchase price represents substantially all of the fair value of the underlying asset. The Company accounts for these
arrangements as financing leases. Payments associated with the right-of-use of these assets are typically fully funded at the acquisition
date and will be recognized over the respective lease term. The right-of-use assets related to these transactions are recorded in
Acquired and other right-of-use assets, net on the Consolidated Balance Sheets.
Discount Rate
When available, the Company uses the rate implicit in the lease to discount lease payments to present value. However, the
Company’s ground leases generally do not provide a readily determinable implicit rate. Therefore, the Company estimates the
incremental borrowing rate to discount lease payments based on information available at lease commencement or upon a modification.
The Company uses publicly available data for instruments with similar characteristics when calculating its incremental borrowing
rates.
Lease Cost
Variable lease payments include escalations based on an inflationary index and are initially recognized using the prevailing
index at the date of initial measurement or upon reassessment of the lease term. Subsequent changes in standard cost of living
increases are recognized as variable lease costs. Variable lease payments also include contingent rent provisions.
The components of lease cost, lease term, and discount rate as of December 31, 2024 and 2023 are as follows:
For the year ended December 31,
2024
2023
(in thousands)
Amortization of acquired and other right-of-use assets
$
38,771 $
42,312
Interest on finance lease liabilities
177
211
Total finance lease cost
38,948
42,523
Operating lease cost
278,443
290,169
Variable lease cost
60,732
63,625
Total lease cost
$
378,123 $
396,317
Weighted-Average Remaining Lease Term as of 2024 and 2023:
Operating leases
15.8 years
12.9 years
Finance leases
50.9 years
49.3 years
Weighted-Average Discount Rate as of 2024 and 2023:
Operating leases
6.6%
6.4%
Finance leases
4.9%
4.4%
For the year ended
Other information:
December 31, 2024
December 31, 2023
Cash paid for amounts included in measurement of lease liabilities:
Cash flows from operating leases
$
277,560 $
279,194
Cash flows from finance leases
$
2,046 $
2,522
F-17
Tenant Leases
The Company enters into long-term lease contracts with wireless service providers to lease antenna space on towers that it
owns or operates. Each tenant lease relates to the lease or use of space at an individual site. Tenant leases are generally for an initial
term of five years to fifteen years with multiple renewal periods, which are at the option of the tenant. Tenant leases typically (1)
contain specific annual rent escalators, (2) escalate annually in accordance with an inflationary index, or (3) escalate using a
combination of fixed and inflation adjusted escalators, including the renewal option periods.
Tenant lease agreements generally include renewal options which can be exercised exclusively at the tenant’s election. The
only common exception is if the Company no longer has a right to the ground underlying the site, the lease agreements permit the
Company to terminate the lease. Despite high frequency of renewal of options to extend the lease by its tenants, the Company has
concluded that the exercise of a renewal option by a tenant is generally not a reasonably certain occurrence; therefore, only the current
committed term is included in the determination of the lease term.
Certain tenant leases provide for a reimbursement of costs incurred by the Company. The Company pays these costs directly
and is not relieved of the primary obligation for the expenses. These reimbursements are recorded as revenue on the Statements of
Operations.
Deferred Lease Costs
ASC 842, Leases, defines initial direct costs as incremental costs that would not have been incurred if the lease had not been
obtained. These costs, including commissions paid related to the origination of specific tenant leases, are deferred and amortized over
the remaining lease term. Initial direct costs were approximately $2.1 million, $3.2 million, and $3.3 million for the years ended
December 31, 2024, 2023, and 2022, respectively. Amortization expense related to deferred initial direct costs was $1.9 million, $2.3
million, and $1.9 million for the years ended December 31, 2024, 2023, and 2022, respectively. As of December 31, 2024 and 2023,
unamortized deferred initial direct costs were $8.8 million and $8.7 million, respectively, and are included in Other assets on the
Consolidated Balance Sheets.
Derivatives and Hedging Activities
The Company enters into interest rate swaps to hedge the future interest expense from variable rate debt and reduce the
Company’s exposure to fluctuations in interest rates. At inception, the Company evaluates the interest rate swaps to determine
whether they qualify for hedge accounting. In accordance with ASC 815, Derivatives and Hedging, hedge accounting should be
provided only if the derivative hedging instrument is expected to be, and actually is, effective at offsetting changes in fair values
or cash flows of the hedged item. The effective portion of the gain or loss is recorded in Accumulated other comprehensive loss,
net on the Consolidated Balance Sheets. The ineffective portion of the gain or loss from the interest rate swap is recognized in
earnings immediately. On a quarterly basis, the Company evaluates whether the cash flow hedge remains highly effective in
offsetting changes in cash flows. Refer to Note 21 for further discussion of the interest rate swaps.
Accounting Standards Updates
Recently Adopted Accounting Pronouncements
In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-07, Segment Reporting
(Topic 280): Improvements to Reportable Segment Disclosures, to enhance reportable segment disclosures, primarily through
additional disclosures of significant segment expenses regularly provided to the chief operating decision maker (“CODM”), along
with disclosure of the title and position of the CODM. The adoption did not have a significant impact on related disclosures. Refer
to Note 15 for the Company’s Segment Data disclosures.
Recently Issued Accounting Pronouncements Not Yet Adopted
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax
Disclosures, requiring public business entities to provide improved income tax disclosures on an annual basis, primarily through
enhanced disclosures related to rate reconciliation and income taxes paid information. The standard is effective for fiscal years
beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the effect of this
standard on its consolidated financial statements and related disclosures.
F-18
In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense
Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, requiring improved expense
disclosures, in the notes to the financial statements, of public business entities to provide more detailed information about certain
costs and expenses. The standard is effective for annual reporting period beginning after December 15, 2026, and interim
reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the effect
of this standard on its consolidated financial statements and related disclosures.
3.
FAIR VALUE MEASUREMENTS
Items Measured at Fair Value on a Recurring Basis—The Company’s asset retirement obligations are measured at fair
value on a recurring basis using Level 3 inputs and are recorded in Other long-term liabilities in the Consolidated Balance Sheets. The
fair value of the asset retirement obligations is calculated using a discounted cash flow model.
Refer to Note 20 for discussion of the Company’s redeemable noncontrolling interests.
Items Measured at Fair Value on a Nonrecurring Basis— The Company estimates the fair value of assets subject to
impairment using a discounted cash flow ("DCF") (Level 3 input) analysis. Determining fair value requires the exercise of significant
judgments, including the amount and timing of expected future cash flows, long-term growth rates, discount rates and relevant
comparable earnings and trading multiples. The cash flows employed in the DCF analysis are based on estimates of future revenues,
earnings, and cash flows after considering factors such as tower location demographics, timing of additions of new tenants, lease rates,
rate and term of renewal, attrition, ongoing cash requirements, and market multiples. Each of the assumptions are applied based on the
specific facts and circumstances of the identified assets at the lowest level of identifiable cash flows. The DCF analysis used an
average discount rate ranging from 7.5%- 8.8%.
Asset impairment and decommission costs for all periods presented and the related impaired assets primarily relate to the
Company’s site leasing operating segment. The following summarizes the activity of asset impairment and decommission costs (in
thousands):
For the year
ended December 31,
2024
2023
2022
Asset impairment (1)
$
73,848
$
139,466
$
34,734
Write-off of carrying value of decommissioned towers
15,452
12,015
8,095
Other (including tower and equipment decommission costs)
18,625
17,906
331
Total asset impairment and decommission costs
$
107,925
$
169,387
$
43,160
(1)
Represents impairment charges resulting from the Company’s regular analysis of whether the anticipated future cash flows
from certain towers are sufficient to recover the carrying value of the investment in those towers. Impairment charges for the
year ended December 31, 2023 includes the impact of the planned abandonment of identified sites with minimal expectations
of future economic benefit (primarily from Sprint and Oi related churn), partially offset by a $45.1 million benefit from the
reassessment of the lease terms. The reassessment resulted in an overall shortening of the lease term and a reduction to the
lease liability and right-of-use asset.
The Company’s long-term investments were $20.8 million and $24.5 million as of December 31, 2024 and 2023,
respectively, and are recorded in Other assets on the Consolidated Balance Sheets. The estimation of the fair value of the investment
involves the use of Level 3 inputs. The Company evaluates these investments for indicators of impairment. The Company considers
impairment indicators such as negative changes in industry and market conditions, financial performance, business prospects, and
other relevant events and factors. If indicators exist and the fair value of the investment is less than the carrying amount, an
impairment charge will be recorded. The Company did not recognize any impairment loss associated with its investments during the
year ended December 31, 2024. During the years December 31, 2023 and 2022, the Company recognized an impairment loss of $4.7
million and $0.9 million, respectively, associated with its investments.
Fair Value of Financial Instruments— The carrying values of cash and cash equivalents, accounts receivable, restricted
cash, accounts payable, and short-term investments approximate their estimated fair values due to the short maturity of these
instruments. The Company’s estimate of its short-term investments is based primarily upon Level 1 reported market values. As of
December 31, 2024 and 2023, the Company had $254.5 million and $1.0 million of short-term investments, respectively. The
Company purchased $1.8 billion and sold $1.5 billion of short-term investments during the year ended December 31, 2024. The
F-19
Company purchased and sold $1.3 billion and $0.9 billion of short-term investments during the years ended December 31, 2023 and
2022, respectively.
The Company determines fair value of its debt instruments utilizing various Level 2 sources including quoted prices and
indicative quotes (non-binding quotes) from brokers that require judgment to interpret market information including implied credit
spreads for similar borrowings on recent trades or bid/ask prices. The fair value of the Revolving Credit Facility is considered to
approximate the carrying value because the Company does not believe its credit risk has changed materially from the date the
applicable Term SOFR Rate was set for the Revolving Credit Facility (112.5 to 150.0 basis points). Refer to Note 11 for the fair
values, principal balances, and carrying values of the Company’s debt instruments.
For discussion of the Company’s derivatives and hedging activities, refer to Note 2 and Note 21.
4.
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH
The cash, cash equivalents, and restricted cash balances on the Consolidated Statements of Cash Flows consist of the
following:
As of
As of
As of
December 31, 2024
December 31, 2023
December 31, 2022
Included on Balance Sheet
(in thousands)
Cash and cash equivalents
$
189,841
$
208,547
$
143,708
Cash and cash equivalents
Securitization escrow accounts
1,200,025
31,852
35,820
Restricted cash - current asset
Payment, performance bonds, and other
6,628
6,277
6,139
Restricted cash - current asset
Surety bonds and workers compensation
4,163
4,270
3,616
Other assets - noncurrent
Total cash, cash equivalents, and restricted cash
$
1,400,657
$
250,946
$
189,283
Pursuant to the terms of the Tower Securities (see Note 11), the Company is required to establish a securitization escrow
account, held by the indenture trustee, into which all rents and other sums due on the towers that secure the Tower Securities are
directly deposited by the lessees. These restricted cash amounts are used to fund reserve accounts for the payment of (1) debt service
costs, (2) ground rents, real estate and personal property taxes, and insurance premiums related to towers, (3) trustee and servicing
expenses, and (4) management fees. The restricted cash in the securitization escrow account in excess of required reserve balances is
subsequently released to the Borrowers (as defined in Note 11) monthly, provided that the Borrowers are in compliance with their debt
service coverage ratio and that no event of default has occurred. All monies held by the indenture trustee are classified as restricted
cash on the Company’s Consolidated Balance Sheets. Additionally, securitization escrow accounts include $1.165 billion held as of
December 31, 2024 which was utilized to repay the 2019-1C Tower Securities on January 15, 2025.
Payment and performance bonds relate primarily to collateral requirements for tower construction currently in process by the
Company. Other restricted cash includes $6.4 million and $6.1 million held in escrow as of December 31, 2024 and 2023,
respectively, related to the Company’s acquisition activities. Cash is pledged as collateral related to surety bonds issued for the benefit
of the Company or its affiliates in the ordinary course of business and primarily related to the Company’s tower removal obligations.
As of December 31, 2024 and 2023, the Company had $42.5 million and $42.0 million in surety and payment and performance bonds,
respectively, for which no collateral was required to be posted. The Company periodically evaluates the collateral posted for its bonds
to ensure that it meets the minimum requirements. As of December 31, 2024 and 2023, the Company had pledged $2.5 million and
$2.4 million, respectively, as collateral related to its workers’ compensation policy.
5.
COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS
The Company’s costs and estimated earnings on uncompleted contracts are comprised of the following:
As of
As of
December 31, 2024
December 31, 2023
(in thousands)
Costs incurred on uncompleted contracts
$
74,474
$
98,674
Estimated earnings
31,514
64,589
Billings to date
(92,082)
(152,608)
$
13,906
$
10,655
F-20
These amounts are included in the Consolidated Balance Sheets under the following captions:
As of
As of
December 31, 2024
December 31, 2023
(in thousands)
Costs and estimated earnings in excess of billings on uncompleted contracts
$
19,198
$
16,252
Billings in excess of costs and estimated earnings on
uncompleted contracts (included in Other current liabilities)
(5,292)
(5,597)
$
13,906
$
10,655
At December 31, 2024 and 2023, the two largest customers comprised 89.0% and 84.6%, respectively, of the costs and
estimated earnings in excess of billings on uncompleted contracts, net of billings in excess of costs and estimated earnings.
6.
PREPAID EXPENSES AND OTHER CURRENT ASSETS AND OTHER ASSETS
The Company’s prepaid expenses and other current assets are comprised of the following:
As of
As of
December 31, 2024
December 31, 2023
(in thousands)
Short-term investments
$
254,534
$
1,046
Short-term loans receivable (1)
115,281
1,026
Prepaid real estate taxes
3,564
3,522
Interest receivable
4,359
2,102
Prepaid insurance
1,704
1,522
Prepaid taxes
11,496
9,064
Prepaid ground rent
3,638
3,712
Other current assets
22,757
16,599
Total prepaid expenses and other current assets
$
417,333
$
38,593
The Company’s other assets are comprised of the following:
As of
As of
December 31, 2024
December 31, 2023
(in thousands)
Straight-line rent receivable
$
417,572
$
415,100
Interest rate swap asset (2)
50,589
104,674
Loans receivable (1)
59,326
148,104
Deferred lease costs, net
8,836
8,713
Deferred tax asset - long term
53,974
67,473
Long-term investments
20,779
24,540
Other
46,021
43,872
Total other assets
$
657,097
$
812,476
(1)
On March 17, 2023 (as amended through February 18, 2025), the Company entered into a loan agreement with one of its
unconsolidated joint ventures (“the Investee”). As part of the loan agreement, as amended, the Investee may borrow up to
$115.0 million in aggregate principal amount, consisting of a $73.0 million initial term loan and $42.0 million of delayed
draw term loans. The final maturity date of the loans is March 7, 2025. The loans accrue interest at a variable rate, adjusting
monthly, plus the applicable margin. The loans are collateralized by equity securities in the Investee. The funding of the loans
is recorded in Other investing activities on the Consolidated Statements of Cash Flows. The outstanding principal balance of
the loan was $115.0 million and $100.5 million as of December 31, 2024 and 2023, respectively. The loan was included
within Short-term loans receivable and Loans receivable as of December 31, 2024 and 2023, respectively. As of December
31, 2024, the loan was accruing interest at a blended rate of 9.303%.
(2)
Refer to Note 21 for more information on the Company’s interest rate swaps.
F-21
7.
ACQUISITIONS
The following table summarizes the Company’s acquisition activity:
For the year ended December 31,
2024
2023
2022
Tower acquisitions (number of towers)
186
91
4,790
The following table summarizes the Company’s cash acquisition capital expenditures:
For the year ended December 31,
2024
2023
2022
(in thousands)
Acquisitions of towers and related assets (1)(2)
$
243,635
$
86,686
$
1,092,462
Land buyouts and other assets (3)(4)
56,176
43,275
83,630
Total cash acquisition capital expenditures
$
299,811
$
129,961
$
1,176,092
(1)
During the year ended December 31, 2022, the Company closed on 1,445 sites from Airtel Tanzania for $176.1 million.
(2)
During the year ended December 31, 2022, the Company acquired 2,632 sites from GTS in Brazil for $728.2 million, net of
working capital adjustments.
(3)
Excludes $24.9 million, $17.6 million, and $17.9 million spent to extend ground lease terms for the years ended December
31, 2024, 2023, and 2022, respectively.
(4)
The year ended December 31, 2022 includes amounts paid related to the acquisition of a data center.
During the years ended December 31, 2024, 2023, and 2022, the Company acquired 186, 91, and 4,790 towers and related
assets and liabilities, respectively. The table below summarizes the Company's acquisition of towers and related assets, by asset class:
For the year ended December 31,
2024
2023
2022 (1)
(in thousands)
Property and equipment, net
$
28,730
$
18,762
$
148,303
Intangible assets, net
217,388
66,616
351,967
Operating lease right-of-use assets, net
28,505
15,863
173,796
Acquired and other right-of-use assets, net
68
3,744
567,303
Acquisition related holdbacks
(5,231)
(2,541)
(24,280)
Long-term lease liabilities
(21,399)
(13,458)
(124,872)
Other (liabilities) assets assumed, net
(4,426)
(2,300)
245
Total acquisitions of towers and related assets
$
243,635
$
86,686
$
1,092,462
(1)
These amounts include the purchase price allocation for GTS consisting of $23.8 million of property and equipment, net,
$142.2 million of intangible assets, net, $48.8 million of operating lease right-of-use assets, net, $529.3 million of acquired
and other right-of-use assets, net, $18.3 million of long-term lease liabilities, and $2.4 million of other net assets assumed.
In the year ended December 31, 2024, the Company concluded that for all of its acquisitions, substantially all of the value of
its tower acquisitions is concentrated in a group of similar identifiable assets.
During the fourth quarter of 2024, the Company entered into an agreement to purchase over 7,000 communication sites in
Central America from Millicom International Cellular S.A. (“Millicom”) for approximately $975.0 million in cash. These sites are
located in Guatemala, Honduras, Panama, El Salvador, and Nicaragua, with significantly all cash flows denominated in USD. Upon
closing, Millicom will enter into country-specific master lease agreements (“MLAs”) to lease back space on all acquired sites for an
initial term of 15 years. The MLAs will also incorporate an extension to the Company’s approximately 1,500 existing site leases with
Millicom for a new 15-year term. Additionally, as part of the purchase agreement, the Company has agreed to a seven-year exclusivity
right with Millicom to build up to 2,500 build-to-suit sites in Central America for Millicom with new leases on any sites built having
an initial lease term of 15 years. This transaction has an estimated closing date of September 1, 2025; however, the ultimate closing is
dependent upon regulatory approvals and other requirements and may differ from this date.
In addition to the Millicom transaction, subsequent to December 31, 2024, the Company purchased or is under contract to
purchase 32 communication sites for an aggregate consideration of $14.6 million in cash. The Company anticipates that these
acquisitions will be closed by the end of the second quarter of 2025.
F-22
The maximum potential obligation related to contingent consideration for acquisitions were $12.1 million and $17.9 million
as of December 31, 2024 and 2023, respectively. No such amounts have been recorded on the Company’s Consolidated Balance
Sheets.
8.
PROPERTY AND EQUIPMENT, NET
Property and equipment, net consists of the following:
As of
As of
December 31, 2024
December 31, 2023
(in thousands)
Towers and related assets
$
5,902,092
$
5,836,485
Construction-in-process (1)
72,202
105,627
Furniture, equipment, and vehicles
84,629
76,031
Land, buildings, and improvements (2)
1,013,253
941,358
Total property and equipment
7,072,176
6,959,501
Less: accumulated depreciation
(4,280,092)
(4,247,782)
Property and equipment, net
$
2,792,084
$
2,711,719
(1)
Construction-in-process represents costs incurred related to towers and other assets that are under development and will be
used in the Company’s site leasing operations.
(2)
Includes amounts related to the Company’s data centers.
Depreciation expense was $116.3 million, $272.3 million, and $274.0 million for the years ended December 31, 2024, 2023,
and 2022, respectively. As a result of the Company’s revision of the estimated useful lives of its towers, the Company experienced
decreased depreciation expense for the year ended December 31, 2024 when compared to the prior year. At December 31, 2024 and
2023, unpaid capital expenditures that are included in accounts payable and accrued expenses were $14.6 million and $6.5 million,
respectively.
9.
INTANGIBLE ASSETS, NET
The following table provides the gross and net carrying amounts for each major class of intangible assets:
As of December 31, 2024
As of December 31, 2023
Gross carrying
Accumulated
Net book
Gross carrying
Accumulated
Net book
amount
amortization
value
amount
amortization
value
(in thousands)
Current contract intangibles
$
5,164,263
$
(3,338,705) $
1,825,558
$
5,253,563
$
(3,394,009) $
1,859,554
Network location intangibles
1,896,754
(1,333,605)
563,149
1,926,226
(1,330,183)
596,043
Intangible assets, net
$
7,061,017
$
(4,672,310) $
2,388,707
$
7,179,789
$
(4,724,192) $
2,455,597
All intangible assets noted above are included in the Company’s site leasing segment. Amortization expense relating to the
intangible assets above was $107.1 million, $397.0 million, and $406.0 million for the years ended December 31, 2024, 2023, and
2022, respectively. As a result of the Company’s revision of the estimated useful lives of its towers, the Company experienced
decreased amortization expense for the year ended December 31, 2024 when compared to the prior years.
Estimated amortization expense on the Company’s intangibles assets is as follows:
For the year ended December 31,
(in thousands)
2025
$
106,371
2026
106,198
2027
106,177
2028
106,166
2029
106,166
F-23
10.
ACCRUED EXPENSES
The Company’s accrued expenses are comprised of the following:
As of
As of
December 31, 2024
December 31, 2023
(in thousands)
Salaries and benefits
$
24,996
$
25,630
Real estate and property taxes
7,204
7,149
Unpaid capital expenditures
14,581
6,477
Acquisition related holdbacks
10,896
16,100
Other
24,300
37,266
Total accrued expenses
$
81,977
$
92,622
11.
DEBT
The principal values, fair values, and carrying values of debt consist of the following (in thousands):
As of
As of
December 31, 2024
December 31, 2023
Maturity Date
Principal
Balance
Fair Value
Carrying
Value
Principal
Balance
Fair Value
Carrying
Value
Revolving Credit Facility
Jan. 25, 2029
$
— $
—
$
—
$
180,000
$
180,000
$
180,000
2018 Term Loan
Apr. 11, 2025
—
—
—
2,268,000
2,273,670
2,263,343
2024 Term Loan
Jan. 25, 2031
2,282,750
2,282,750
2,260,217
—
—
—
2014-2C Tower Securities (1)
Oct. 8, 2024
—
—
—
620,000
606,540
619,145
2019-1C Tower Securities (1)(2)
Jan. 12, 2025
1,165,000
1,128,803
1,164,913
1,165,000
1,115,313
1,162,348
2020-1C Tower Securities (1)
Jan. 9, 2026
750,000
726,038
748,425
750,000
682,350
746,937
2020-2C Tower Securities (1)
Jan. 11, 2028
600,000
516,342
597,273
600,000
520,530
596,419
2021-1C Tower Securities (1)
Nov. 9, 2026
1,165,000
1,008,331
1,160,436
1,165,000
1,015,437
1,158,059
2021-2C Tower Securities (1)
Apr. 9, 2027
895,000
763,757
890,896
895,000
772,125
889,152
2021-3C Tower Securities (1)
Oct. 9, 2031
895,000
679,144
888,260
895,000
686,581
887,365
2022-1C Tower Securities (1)
Jan. 11, 2028
850,000
878,475
843,321
850,000
850,221
841,429
2024-1C Tower Securities (1)
Oct. 9, 2029
1,450,000
1,453,292
1,437,978
—
—
—
2024-2C Tower Securities (1)
Oct. 8, 2027
620,000
618,698
615,017
—
—
—
2020 Senior Notes
Feb. 15, 2027
1,500,000
1,440,270
1,493,039
1,500,000
1,438,815
1,489,965
2021 Senior Notes
Feb. 1, 2029
1,500,000
1,353,750
1,491,963
1,500,000
1,338,750
1,490,153
Total debt
$
13,672,750
$
12,849,650
$
13,591,738
$
12,388,000
$
11,480,332
$
12,324,315
Less: current maturities of long-term debt
(1,187,913)
(643,145)
Total long-term debt, net of current maturities
$
12,403,825
$
11,681,170
(1)
The maturity date represents the anticipated repayment date for each issuance.
(2)
On January 15, 2025, the Company repaid the aggregate principal amount of the 2019-1C Tower Securities which was
included in current maturities of long-term debt as of December 31, 2024.
The Company’s future principal payment obligations over the next five years (based on the outstanding debt as of December
31, 2024 and assuming the Tower Securities are repaid at their respective anticipated repayment dates) are as follows:
For the year ended December 31,
(in thousands)
2025
$
1,188,000
2026
1,938,000
2027
3,038,000
2028
1,473,000
2029
2,973,000
F-24
The table below reflects cash and non-cash interest expense amounts recognized by debt instrument for the periods presented:
For the year ended December 31,
Interest
2024
2023
2022
Rates as of
Cash
Non-cash
Cash
Non-cash
Cash
Non-cash
December 31, 2024
Interest
Interest
Interest
Interest
Interest
Interest
(in thousands)
Revolving Credit Facility
5.407%
$
8,603
$
—
$
29,223
$
—
$
21,862
$
—
2018 Term Loan
—
3,253
1,867
60,622
30,508
50,052
45,756
2024 Term Loan (1)
2.428%
60,252
25,121
—
—
—
—
2014-2C Tower Securities
3.869%
18,810
—
24,185
—
24,185
—
2018-1C Tower Securities
3.448%
—
—
—
—
21,291
—
2019-1C Tower Securities
2.836%
33,428
—
33,428
—
33,428
—
2020-1C Tower Securities
1.884%
14,391
—
14,391
—
14,391
—
2020-2C Tower Securities
2.328%
14,159
—
14,159
—
14,159
—
2021-1C Tower Securities
1.631%
19,419
—
19,419
—
19,419
—
2021-2C Tower Securities
1.840%
16,782
—
16,782
—
16,782
—
2021-3C Tower Securities
2.593%
23,492
—
23,492
—
23,492
—
2022-1C Tower Securities
6.599%
56,375
—
56,375
—
5,961
—
2024-1C Tower Securities
4.831%
15,677
—
—
—
—
—
2024-2C Tower Securities (2)
4.654%
7,091
—
—
—
—
—
2020 Senior Notes
3.875%
58,125
383
58,125
367
58,125
353
2021 Senior Notes
3.125%
46,875
—
46,875
—
46,875
—
Other
3,046
290
3,297
4,993
3,762
—
Total
$
399,778
$
27,661 $
400,373
$
35,868
$
353,784
$
46,109
(1)
The 2024 Term Loan has a blended rate of 2.428%, which includes the impact of the interest rate swaps. Excluding the
impact of the interest rate swap, the 2024 Term Loan was accruing interest at 6.110% as of December 31, 2024. Refer to
Note 21 for more information on the Company’s interest rate swap.
(2)
The 2024-2C Tower Securities has an all-in fixed rate of 4.654%, which includes the impact of the Company’s treasury lock
agreement. Excluding the impact of the treasury lock agreement, the 2024-2C Tower Securities accrues interest at 5.115%.
Refer to Note 21 for more information on the Company’s treasury lock agreement.
The Senior Credit Agreement
On January 25, 2024, the Company, through its wholly owned subsidiary SBA Senior Finance II, amended and restated its
Senior Credit Agreement to (1) issue a new $2.3 billion Term Loan, (2) increase the total commitments under its Revolving Credit
Facility from $1.5 billion to $1.75 billion, (3) extend the maturity date of its Revolving Credit Facility to January 25, 2029, and (4)
amend certain other terms and conditions under the Senior Credit Agreement.
On February 23, 2024 the Company, through its wholly owned subsidiary, SBA Senior Finance II LLC, further increased the
total commitments under the Revolving Credit Facility from $1.75 billion to $2.0 billion.
On October 2, 2024, the Company, through its wholly owned subsidiary, SBA Senior Finance II, amended its Senior Credit
Agreement to (1) reduce the stated rate of interest of the Initial Term Loans from, at SBA Senior Finance II’s election, the Base Rate
plus 100 basis points or Term SOFR plus 200 basis points to, at SBA Senior Finance II’s election, the Base Rate plus 75 basis points
or Term SOFR plus 175 basis points, and (2) amend certain other terms and conditions under the Senior Credit Agreement.
Terms of the Senior Credit Agreement
The Senior Credit Agreement requires SBA Senior Finance II to maintain specific financial ratios, including (1) a ratio of
Consolidated Net Debt to Annualized Borrower EBITDA not to exceed 6.5 times for any fiscal quarter, (2) a ratio of Consolidated Net
Debt (calculated in accordance with the Senior Credit Agreement) to Annualized Borrower EBITDA for the most recently ended fiscal
quarter not to exceed 6.5 times for 30 consecutive days and (3) a ratio of Annualized Borrower EBITDA to Annualized Cash Interest
Expense (calculated in accordance with the Senior Credit Agreement) of not less than 2.0 times for any fiscal quarter. The Senior
Credit Agreement contains customary affirmative and negative covenants that, among other things, limit the ability of SBA Senior
Finance II and its subsidiaries to incur indebtedness, grant certain liens, make certain investments, enter into sale leaseback
transactions, merge or consolidate, make certain restricted payments, enter into transactions with affiliates, and engage in certain asset
F-25
dispositions, including a sale of all or substantially all of their property. The Senior Credit Agreement is also subject to customary
events of default. Pursuant to the Second Amended and Restated Guarantee and Collateral Agreement, amounts borrowed under the
Revolving Credit Facility, the Term Loans and certain hedging transactions that may be entered into by SBA Senior Finance II or the
Subsidiary Guarantors (as defined in the Senior Credit Agreement) with lenders or their affiliates are secured by a first lien on the
membership interests of SBA Telecommunications, LLC, SBA Senior Finance, LLC and SBA Senior Finance II and on substantially
all of the assets (other than leasehold, easement and fee interests in real property) of SBA Senior Finance II and the Subsidiary
Guarantors.
The Senior Credit Agreement permits SBA Senior Finance II, without the consent of the other lenders, to request that one or
more lenders provide SBA Senior Finance II with increases in the Revolving Credit Facility or additional term loans provided that
after giving effect to the proposed increase in Revolving Credit Facility commitments or incremental term loans the ratio of
Consolidated Net Debt to Annualized Borrower EBITDA would not exceed 6.5 times. SBA Senior Finance II’s ability to request such
increases in the Revolving Credit Facility or additional term loans is subject to its compliance with customary conditions set forth in
the Senior Credit Agreement including compliance, on a pro forma basis, with the financial covenants and ratios set forth therein and,
with respect to any additional term loan, an increase in the margin on existing term loans to the extent required by the terms of the
Senior Credit Agreement. Upon SBA Senior Finance II’s request, each lender may decide, in its sole discretion, whether to increase all
or a portion of its Revolving Credit Facility commitment or whether to provide SBA Senior Finance II with additional term loans and,
if so, upon what terms.
As of December 31, 2024, SBA Senior Finance II was in compliance with the financial covenants contained in the Senior
Credit Agreement.
Revolving Credit Facility under the Senior Credit Agreement
The Revolving Credit Facility consists of a revolving loan under which up to $2.0 billion aggregate principal amount may be
borrowed, repaid and redrawn, based upon specific financial ratios and subject to the satisfaction of other customary conditions to
borrowing through the maturity date of January 25, 2029. Amounts borrowed under the Revolving Credit Facility accrue interest, at
SBA Senior Finance II’s election, at either (1) the Eurodollar Rate or Term SOFR Rate plus a margin that ranges from 112.5 basis
points to 150.0 basis points or (2) the Base Rate plus a margin that ranges from 12.5 basis points to 50.0 basis points, in each case
based on the ratio of Consolidated Net Debt to Annualized Borrower EBITDA, calculated in accordance with the Senior Credit
Agreement. In addition, SBA Senior Finance II is required to pay a commitment fee of between 0.15% and 0.25% per annum on the
amount of unused commitment. Furthermore, the Revolving Credit Facility incorporates sustainability-linked targets which will adjust
the Revolving Credit Facility’s applicable interest and commitment fee rates upward or downward based on how the Company
performs against those targets. Borrowings under the Revolving Credit Facility may be used for general corporate purposes. SBA
Senior Finance II may, from time to time, borrow from and repay the Revolving Credit Facility. Consequently, the amount
outstanding under the Revolving Credit Facility at the end of the period may not be reflective of the total amounts outstanding during
such period.
The key terms of the Revolving Credit Facility are as follows:
Unused
Interest Rate
Commitment
as of
Fee as of
December 31, 2024 (1)
December 31, 2024 (2)
Revolving Credit Facility
5.407%
0.140%
(1)
(1)
The rate reflected includes a 0.050% reduction in the applicable spread as a result of meeting certain sustainability-linked
targets as of December 31, 2023.
(2)
The rate reflected includes a 0.010% reduction in the applicable commitment fee as a result of meeting certain sustainability-
linked targets as of December 31, 2023.
F-26
The table below summarizes the Company’s Revolving Credit Facility activity during the years ended December 31, 2024
and 2023 (in thousands):
For the year
ended December 31,
2024
2023
Beginning outstanding balance
$
180,000
$
720,000
Borrowings
370,000
190,000
Repayments
(550,000)
(730,000)
Ending outstanding balance
$
—
$
180,000
Subsequent to December 31, 2024, the Company made no borrowings from the Revolving Credit Facility.
Term Loan under the Senior Credit Agreement
2024 Term Loan
On January 25, 2024, the Company, through its wholly owned subsidiary, SBA Senior Finance II, issued a term loan (the
“2024 Term Loan”) under the amended and restated Senior Credit Agreement. The 2024 Term Loan consists of a senior secured term
loan with an initial aggregate principal amount of $2.3 billion that matures on January 25, 2031. The 2024 Term Loan (as amended on
October 2, 2024) accrues interest, at SBA Senior Finance II's election, at either the Base Rate (with a zero Base Rate floor) plus 75
basis points or at Term SOFR (with a floor of 0%) plus 175 basis points. The 2024 Term Loan was issued at 99.75% of par value. The
proceeds from the 2024 Term Loan were used to retire the 2018 Term Loan and to pay related fees and expenses.
Principal payments on the 2024 Term Loan will be made in quarterly installments on the last day of each March, June,
September, and December in an amount equal to $5.75 million. The Company incurred financing fees of approximately $19.4 million
in relation to this transaction, which are being amortized through the maturity date.
During the year ended December 31, 2024, the Company repaid an aggregate of $17.3 million of principal on the 2024 Term
Loan. As of December 31, 2024, the 2024 Term Loan had a principal balance of $2.3 billion.
2018 Term Loan
The 2018 Term Loan consisted of a senior secured term loan with an initial aggregate principal amount of $2.4 billion that
was set to mature on April 11, 2025. The 2018 Term Loan accrued interest, at SBA Senior Finance II’s election at either the Base Rate
plus 75 basis points (with a zero Base Rate floor) or the Eurodollar Rate plus 175 basis points (with a zero Eurodollar Rate floor).
On January 25, 2024, the Company, through its wholly owned subsidiary, SBA Senior Finance II, retired the 2018 Term
Loan. In connection with the repayment, the Company expensed $3.3 million of net deferred financing fees and $1.2 million of
original issuance discount related to the debt.
Secured Tower Revenue Securities
Tower Revenue Securities Terms
As of December 31, 2024, the Company, through a New York common law trust (the “Trust”), had issued and outstanding an
aggregate of $8.4 billion of Secured Tower Revenue Securities (“Tower Securities”). The sole asset of the Trust consists of a non-
recourse mortgage loan made in favor of certain of the Company’s subsidiaries that are borrowers on the mortgage loan (the
“Borrowers”) under which there is a loan tranche for each Tower Security outstanding with the same interest rate and maturity date as
the corresponding Tower Security. The mortgage loan will be paid from the operating cash flows from the aggregate 9,516 tower sites
owned by the Borrowers as of December 31, 2024. The mortgage loan is secured by (1) mortgages, deeds of trust, and deeds to secure
debt on a substantial portion of the tower sites, (2) a security interest in the tower sites and substantially all of the Borrowers’ personal
property and fixtures, (3) the Borrowers’ rights under certain tenant leases, and (4) all of the proceeds of the foregoing. For each
calendar month, SBA Network Management, Inc., an indirect subsidiary (“Network Management”), is entitled to receive a
management fee equal to 4.5% of the Borrowers’ operating revenues for the immediately preceding calendar month.
F-27
The Borrowers may prepay any of the mortgage loan components, in whole or in part, with no prepayment consideration,
(1) within six months (in the case of the component corresponding to the 2024-2C Tower Securities), within twelve months (in the
case of the component corresponding to the 2019-1C Tower Securities, 2020-1C Tower Securities, 2021-1C Tower Securities, 2021-
2C Tower Securities, and 2022-1C Tower Securities), eighteen months (in the case of the components corresponding to the 2020-2C
Tower Securities and 2021-3C Tower Securities), or twenty-four months (in the case of the component corresponding to the 2024-1C
Tower Security) of the anticipated repayment date of such mortgage loan component, (2) with proceeds received as a result of any
condemnation or casualty of any tower owned by the Borrowers or (3) during an amortization period. In all other circumstances, the
Borrowers may prepay the mortgage loan, in whole or in part, upon payment of the applicable prepayment consideration. The
prepayment consideration is determined based on the class of the Tower Securities to which the prepaid mortgage loan component
corresponds and consists of an amount equal to the net present value associated with the portion of the principal balance being prepaid
and calculated in accordance with the formula set forth in the mortgage loan agreement.
To the extent that the mortgage loan components corresponding to the Tower Securities are not fully repaid by their
respective anticipated repayment dates, the interest rate of each such component will increase by the greater of (1) 5% and (2) the
amount, if any, by which the sum of (x) the 10 year U.S. treasury rate plus (y) the credit-based spread for such component (as set forth
in the mortgage loan agreement) plus (z) 5%, exceeds the original interest rate for such component.
Pursuant to the terms of the Tower Securities, all rents and other sums due on any of the towers owned by the Borrowers are
directly deposited by the lessees into a controlled deposit account and are held by the indenture trustee. The monies held by the
indenture trustee after the release date are classified as short-term restricted cash on the Consolidated Balance Sheets (see Note 4).
However, if the Debt Service Coverage Ratio, defined as the net cash flow (as defined in the mortgage loan agreement) divided by the
amount of interest on the mortgage loan, servicing fees and trustee fees that the Borrowers are required to pay over the succeeding
twelve months, as of the end of any calendar quarter, falls to 1.30x or lower, then all cash flow in excess of amounts required to make
debt service payments, to fund required reserves, to pay management fees and budgeted operating expenses and to make other
payments required under the loan documents, referred to as “excess cash flow,” will be deposited into a reserve account instead of
being released to the Borrowers. The funds in the reserve account will not be released to the Borrowers unless the Debt Service
Coverage Ratio exceeds 1.30x for two consecutive calendar quarters. If the Debt Service Coverage Ratio falls below 1.15x as of the
end of any calendar quarter, then an “amortization period” will commence and all funds on deposit in the reserve account will be
applied to prepay the mortgage loan until such time that the Debt Service Coverage Ratio exceeds 1.15x for a calendar quarter. In
addition, if any of the Tower Securities are not fully repaid by their respective anticipated repayment dates, the cash flow from the
towers owned by the Borrowers will be trapped by the trustee for the Tower Securities and applied first to repay the interest, at the
original interest rates, on the mortgage loan components underlying the Tower Securities, second to fund all reserve accounts and
operating expenses associated with those towers, third to pay the management fees due to Network Management, fourth to repay
principal of the Tower Securities and fifth to repay the additional interest discussed above. Furthermore, the advance rents reserve
requirement states that the Borrowers are required to maintain an advance rents reserve at any time the monthly tenant Debt Service
Coverage Ratio is equal to or less than 2:1 and for two calendar months after such coverage ratio again exceeds 2:1. The mortgage
loan agreement, as amended, also includes covenants customary for mortgage loans subject to rated securitizations. Among other
things, the Borrowers are prohibited from incurring other indebtedness for borrowed money or further encumbering their assets.
The table below sets forth the material terms of the Company’s outstanding Tower Securities as of December 31, 2024:
Security (1)
Issue Date
Amount
Outstanding
(in millions)
Interest
Rate (2)
Anticipated
Repayment Date
Final Maturity
Date
2019-1C Tower Securities (3)
Sep. 13, 2019
$1,165.0
2.836%
Jan. 12, 2025
Jan. 12, 2050
2020-1C Tower Securities
Jul. 14, 2020
$750.0
1.884%
Jan. 9, 2026
Jul. 11, 2050
2020-2C Tower Securities
Jul. 14, 2020
$600.0
2.328%
Jan. 11, 2028
Jul. 9, 2052
2021-1C Tower Securities
May 14, 2021
$1,165.0
1.631%
Nov. 9, 2026
May 9, 2051
2021-2C Tower Securities
Oct. 27, 2021
$895.0
1.840%
Apr. 9, 2027
Oct. 10, 2051
2021-3C Tower Securities
Oct. 27, 2021
$895.0
2.593%
Oct. 9, 2031
Oct. 10, 2056
2022-1C Tower Securities
Nov. 23, 2022
$850.0
6.599%
Jan. 11, 2028
Nov. 9, 2052
2024-1C Tower Securities (3)
Oct. 11, 2024
$1,450.0
4.831%
Oct. 9, 2029
Oct. 8, 2054
2024-2C Tower Securities (4)(5)
Oct. 11, 2024
$620.0
4.654%
Oct. 8, 2027
Oct. 8, 2054
(1)
The Company incurred $12.8 million, $8.0 million, $6.4 million, $12.9 million, $9.5 million, $9.5 million, $10.5 million,
$12.5 million, and $5.4 million in financing fees relating to the issuances of the 2019-1C Tower Securities, 2020-1C Tower
Securities, 2020-2C Tower Securities, 2021-1C Tower Securities, 2021-2C Tower Securities, 2021-3C Tower Securities,
F-28
2022-1C Tower Securities, 2024-1C Tower Securities, and 2024-2C Tower Securities, respectively. The financing fees are
being amortized through the anticipated repayment date of the related Tower Security.
(2)
Interest paid monthly.
(3)
The Company used the proceeds from the issuance of the 2024-1C Tower Securities to repay the entire aggregate principal
amount of the 2019-1C Tower Securities ($1,165.0 million) and the 2019-1R Tower Securities ($61.4 million) on January 15,
2025.
(4)
Net proceeds from this issuance were used to repay the entire aggregate principal amount of the 2014-2C Tower Securities
($620.0 million).
(5)
The interest rate reflected is the all-in interest rate including the impact of the Company’s treasury lock agreement.
The table below sets forth the material terms of the Company’s Tower Securities that were repaid during the years ended
December 31, 2024, 2023, and 2022:
Security (1)
Issue Date
Amount
Outstanding
(in millions)
Interest
Rate (2)
Anticipated
Repayment Date
Actual
Repayment Date
2018-1C Tower Securities
Mar. 9, 2018
$640.0
3.448%
Mar. 9, 2023
Dec. 15, 2022
2014-2C Tower Securities
Oct. 15, 2014
$620.0
3.869%
Oct. 8, 2024
Oct. 8, 2024
(1)
The Company incurred $8.6 million and $9.0 million in financing fees relating to the issuances of the 2018-1C Tower
Securities and the 2014-2C Tower Securities, respectively, which were being amortized through the anticipated repayment
date of the related Tower Security. In addition, the Company incurred $0.4 million and $0.2 million of deferred financing
fees and accrued interest related to the repayment of the 2018-1C Tower Securities and 2014-2C Tower Securities,
respectively, which are reflected in loss from extinguishment of debt on the Consolidated Statement of Operations.
(2)
Interest was paid monthly.
Risk Retention Tower Securities
The table below sets forth the material terms of the Company’s outstanding Risk Retention Tower Securities as of December
31, 2024:
Security
Issue Date
Amount
Outstanding
(in millions)
Interest
Rate (1)
Anticipated
Repayment Date
Final Maturity
Date
2019-1R Tower Securities (2)
Sep. 13, 2019
$61.4
4.213%
Jan. 12, 2025
Jan. 12, 2050
2020-2R Tower Securities
Jul. 14, 2020
$71.1
4.336%
Jan. 11, 2028
Jul. 9, 2052
2021-1R Tower Securities
May 14, 2021
$61.4
3.598%
Nov. 9, 2026
May 9, 2051
2021-3R Tower Securities
Oct. 27, 2021
$94.3
4.090%
Oct. 9, 2031
Oct. 10, 2056
2022-1R Tower Securities
Nov. 23, 2022
$44.8
7.870%
Jan. 11, 2028
Nov. 9, 2052
2024-1R Tower Securities
Oct. 11, 2024
$108.7
6.252%
Oct. 9, 2029
Oct. 8, 2054
(1)
Interest paid monthly.
(2)
The 2019-1R Tower Securities were retired on January 15, 2025.
To satisfy certain risk retention requirements of Regulation RR promulgated under the Exchange Act, SBA Guarantor, LLC,
a wholly owned subsidiary, purchased the Risk Retention Tower Securities. Principal and interest payments made on the 2019-1R
Tower Securities, 2020-2R Tower Securities, 2021-1R Tower Securities, 2021-3R Tower Securities, 2022-1R Tower Securities, and
2024-1R Tower Securities eliminate in consolidation.
The table below sets forth the material terms of the Company’s Risk Retention Tower Securities that were repaid during the
years ended December 31, 2024, 2023, and 2022:
Security
Issue Date
Amount
Outstanding
(in millions)
Interest
Rate (1)
Anticipated
Repayment Date
Actual
Repayment Date
2018-1R Tower Securities
Mar. 9, 2018
$33.7
4.949%
Mar. 9, 2023
Dec. 15, 2022
(1)
Interest was paid monthly.
F-29
To satisfy certain risk retention requirements of Regulation RR promulgated under the Exchange Act, SBA Guarantor, LLC,
a wholly owned subsidiary, purchased the Risk Retention Tower Securities. Principal and interest payments made on the 2018-1R
Tower Securities eliminated in consolidation.
Debt Covenants
As of December 31, 2024, the Borrowers met the debt service coverage ratio required by the mortgage loan agreement and
were in compliance with all other covenants as set forth in the agreement.
Senior Notes
Indentures Governing Senior Notes
The Indentures governing the Senior Notes contain customary covenants, subject to a number of exceptions and
qualifications, including restrictions on the ability of SBAC and Telecommunications to (1) incur additional indebtedness unless the
Consolidated Indebtedness to Annualized Consolidated Adjusted EBITDA Ratio (as defined in the Indenture), pro forma for the
additional indebtedness does not exceed, with respect to any fiscal quarter, 9.5x for SBAC, (2) merge, consolidate, or sell assets, (3)
make restricted payments, including dividends or other distributions, (4) enter into transactions with affiliates, and (5) enter into sale
and leaseback transactions and restrictions on the ability of the Restricted Subsidiaries of SBAC (as defined in the Indentures) to incur
liens securing indebtedness.
The table below sets forth the material terms of the Company’s outstanding senior notes as of December 31, 2024:
Senior Notes (1)
Issue Date
Amount
Outstanding
(in millions)
Interest Rate
Coupon
Maturity Date
Interest Due Dates
2020 Senior Notes
Feb. 4, 2020
$1,500.0
3.875%
Feb. 15, 2027
Feb. 15 & Aug. 15
2021 Senior Notes
Jan. 29, 2021
$1,500.0
3.125%
Feb. 1, 2029
Feb. 1 & Aug. 1
(1)
The Company incurred $18.0 million and $14.8 million in financing fees in relation to the issuance of the 2020 Senior Notes
and 2021 Senior Notes, respectively. The financing fees are being amortized through the maturity date of the related senior
note.
Each of the senior notes is subject to redemption, at the Company’s option, in whole or in part on or after the date set forth
above. During the subsequent three twelve-month periods, the senior notes are redeemable, at the Company’s option, at reducing
redemption prices based on the applicable interest rate coupon (as set forth in the indenture) plus accrued and unpaid interest.
Subsequent to such date, the senior notes become redeemable until maturity at 100% of the principal plus accrued and unpaid interest.
The Company may redeem the 2020 Senior Notes during the twelve-month period beginning on the following dates at the following
redemption prices: February 15, 2025 until maturity at 100.000%, of the principal amount of the 2020 Senior Notes to be redeemed on
the redemption date plus accrued and unpaid interest. The Company may redeem the 2021 Senior Notes during the twelve-month
period beginning on the following dates at the following redemption prices: February 1, 2025 at 100.781% or February 1, 2026 until
maturity at 100.000%, of the principal amount of the 2021 Senior Notes to be redeemed on the redemption date plus accrued and
unpaid interest.
12.
SHAREHOLDERS’ EQUITY
Common Stock Equivalents
The Company has outstanding stock options, time-based restricted stock units (“RSUs”), and performance-based restricted
stock units (“PSUs”) which were considered in the Company’s diluted earnings per share calculation (see Note 16).
Registration of Additional Shares
The Company filed a shelf registration statement on Form S-4 with the Securities and Exchange Commission registering
4.0 million shares of its Class A common stock in 2007. These shares may be issued in connection with acquisitions of wireless
communication towers or antenna sites and related assets or companies that own wireless communication towers, antenna sites, or
related assets. During the years ended December 31, 2024 and 2023, the Company did not issue any shares of Class A common stock
under this registration statement. As of December 31, 2024, the Company had approximately 1.2 million shares of Class A common
stock remaining under this registration statement.
F-30
On February 29, 2024, the Company filed with the Securities and Exchange Commission an automatic shelf registration
statement for well-known seasoned issuers on Form S-3ASR, which enables the Company to issue shares of its Class A common
stock, preferred stock, debt securities, warrants, or depositary shares as well as units that include any of these securities. The Company
will file a prospectus supplement containing the amount and type of securities each time it issues securities under its automatic shelf
registration statement on Form S-3ASR. During the year ended December 31, 2024 the Company did not issue any securities under its
automatic shelf registration statement.
On August 6, 2020, the Company filed a registration statement on Form S-8 with the Securities and Exchange Commission
registering 3.4 million shares of the Company’s Class A common stock, consisting of 3.0 million shares of Class A common stock
issuable under the 2020 Performance and Equity Incentive Plan (the “2020 Plan”) and 400,000 shares of Class A common stock
subject to awards granted under the 2010 Performance and Equity Incentive Plan (the “2010 Plan”) that may become available for
issuance or reissuance, as applicable, under the 2020 Plan if such awards are forfeited or are settled in cash or otherwise expire or
terminate without the delivery of the shares (see Note 13).
Stock Repurchases
The Company’s Board of Directors authorizes the Company to purchase, from time to time, outstanding Class A common
stock through open market repurchases in compliance with Rule 10b-18 under the Exchange Act, and/or in privately negotiated
transactions at management’s discretion based on market and business conditions, applicable legal requirements, and other factors.
Once authorized, the repurchase plan has no time deadline and will continue until otherwise modified or terminated by the Company’s
Board of Directors at any time in its sole discretion. Shares repurchased are retired. On October 28, 2021, the Company’s Board of
Directors authorized a $1.0 billion stock repurchase plan. As of the date of this filing, the Company had $204.7 million of
authorization remaining under the plan.
The following is a summary of the Company’s share repurchases:
For the year
ended December 31,
2024
2023
2022
Total number of shares purchased (in millions) (1)
0.9
0.5
1.3
Average price per share (1)
$
213.85
$
197.89
$
332.00
Total purchase price (in millions) (1)
$
200.0
$
100.0
$
431.6
(1)
Amounts reflected are based on the trade date and differ from the Consolidated Statements of Cash Flows which reflects
share repurchases based on the settlement date.
Dividends
As a REIT, the Company is required to distribute annually at least 90% of its REIT taxable income after the utilization of any
available NOLs (determined before the deduction for dividends paid and excluding any net capital gain). As of December 31, 2024,
$337.7 million of the federal NOLs are attributes of the REIT. The Company may use these NOLs to offset its REIT taxable income,
and thus any required distributions to shareholders may be reduced or eliminated until such time as the Company’s NOLs have been
fully utilized. The amount of future distributions will be determined, from time to time, by the Board of Directors to balance the
Company’s goal of increasing long-term shareholder value and retaining sufficient cash to implement the Company’s current capital
allocation policy, which prioritizes investment in quality assets that meet the Company’s return criteria, and then stock repurchases
when the Company believes its stock price is below its intrinsic value. The actual amount, timing, and frequency of future dividends
will be at the sole discretion of the Board of Directors and will be declared based upon various factors, many of which are beyond the
Company’s control.
For the year ended December 31, 2024, the Company paid the following cash dividends:
Payable to Shareholders
of Record at the Close
Cash Paid
Aggregate Amount
Date Declared
of Business on
Per Share
Paid
Date Paid
February 26, 2024
March 14, 2024
$0.98
$108.1 million (1)
March 28, 2024
April 29, 2024
May 23, 2024
$0.98
$105.3 million
June 18, 2024
July 28, 2024
August 22, 2024
$0.98
$105.3 million
September 18, 2024
October 27, 2024
November 14, 2024
$0.98
$105.4 million
December 12, 2024
F-31
(1)
Amount reflected includes the payment of $1.9 million in dividend equivalents.
Dividends paid in 2024 and 2023 were ordinary taxable dividends.
Subsequent to December 31, 2024, the Company declared the following cash dividends:
Payable to Shareholders
Cash to
of Record at the Close
be Paid
Date Declared
of Business on
Per Share
Date to be Paid
February 23, 2025
March 13, 2025
$1.11
March 27, 2025
13.
STOCK-BASED COMPENSATION
On February 25, 2020, the Company’s 2010 Plan expired by its terms. On May 14, 2020, the Company’s shareholders
approved the 2020 Plan which provides for the issuance of up to 3.0 million shares of the Company’s Class A common stock (of
which approximately 1.9 million shares remain available for future issuance as of December 31, 2024), plus additional shares of Class
A common stock (a) subject to awards granted under the 2010 Plan that may become available for issuance or reissuance, as
applicable, under the 2020 Plan if such awards are forfeited or are settled in cash or otherwise expire or terminate without the delivery
of the shares or (b) which become issuable under the 2020 Plan by reason of any stock dividend, stock split, recapitalization or other
similar transaction effected without the receipt of consideration which results in an increase in the number of outstanding shares of
Class A common stock.
Commencing with the 2020 equity award, the Company modified the type of equity granted to certain employees to align
long-term compensation with Company performance. Under the new structure, the Company continued to issue RSUs; however,
RSUs will now vest ratably over three years rather than four years. The Company further replaced stock options with PSUs which will
cliff vest at the end of three years. PSUs have performance metrics for which threshold, target, and maximum parameters are
established at the time of the grant. The performance metrics are used to calculate the number of shares that will be issuable when the
awards vest, which may range from zero to 200% of the target amounts. At the end of each three year performance period, the number
of shares that vest will depend on the results achieved against the pre-established performance metrics. Furthermore, effective with the
2020 grant, RSUs and PSUs will accrue dividend equivalents prior to vesting, which will be paid out only in respect to shares that
actually vest.
Stock Options
The Company records compensation expense for employee stock options based on the estimated fair value of the options on
the date of grant using the Black-Scholes option-pricing model with the assumptions included in the table below. The Company uses a
combination of historical data and historical volatility to establish the expected volatility, as well as to estimate the expected option
life. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the estimated life of the option. The
following assumptions were used to estimate the fair value of options granted using the Black-Scholes option-pricing model:
For the year ended December 31,
2023
2022
Risk free interest rate
3.96%
2.53%
Dividend yield
1.50%
0.9%
Expected volatility
30.0%
27.2%
Expected lives
4.4 years
4.3 years
There were no options granted during the year ended December 31, 2024.
F-32
The following table summarizes the Company’s activities with respect to its stock option plans for the years ended December
31, 2024, 2023 and 2022 as follows (dollars and shares in thousands, except for per share data):
Weighted-
Weighted-Average
Average
Remaining
Number
Exercise Price
Contractual
Aggregate
of Shares
Per Share
Life (in years)
Intrinsic Value
Outstanding at December 31, 2021
1,899
$
157.76
Granted
10
$
328.99
Exercised
(233)
$
141.41
Forfeited/canceled
(3)
$
179.16
Outstanding at December 31, 2022
1,673
$
161.02
Granted
20
$
224.24
Exercised
(339)
$
132.70
Forfeited/canceled
(14)
$
238.10
Outstanding at December 31, 2023
1,340
$
168.32
Exercised
(250)
$
140.18
Forfeited/canceled
(2)
$
197.91
Outstanding at December 31, 2024
1,088
$
174.74
1.1
$
33,420
Exercisable at December 31, 2024
1,066
$
173.12
1.0
$
33,420
Unvested at December 31, 2024
22
$
252.81
8.1
$
—
The weighted-average per share fair value of options granted during the years December 31, 2023 and 2022 was $58.95 and
$82.28, respectively.
The total intrinsic value for options exercised during the years ended December 31, 2024, 2023, and 2022 was $19.5 million,
$40.0 million, and $45.2 million, respectively. Cash received from option exercises under all plans for the years ended December 31,
2024, 2023, and 2022 was approximately $29.4 million, $38.6 million, and $31.6 million, respectively. The tax provision/(benefit)
realized for the tax deductions from option exercises under all plans was $1.5 million, ($4.9) million, and ($18.4) million for the years
ended December 31, 2024, 2023, and 2022, respectively.
The aggregate intrinsic value for stock options in the preceding table represents the total intrinsic value based on the
Company’s closing stock price of $203.80 as of December 31, 2024. The amount represents the total intrinsic value that would have
been received by the holders of the stock-based awards had these awards been exercised and sold as of that date.
Additional information regarding options outstanding and exercisable at December 31, 2024 is as follows:
Options Outstanding
Options Exercisable
Weighted-Average
Weighted-
Weighted-
Remaining
Average
Average
Range
Outstanding
Contractual Life
Exercise Price
Exercisable
Exercise Price
(in thousands)
(in years)
(in thousands)
$140.01 - $180.00
422
0.2
$
156.52
422
$
156.52
$180.01 - $230.00
654
1.6
$
183.93
638
$
182.92
$230.01 - $330.00
12
6.5
$
320.14
6
$
310.59
1,088
1,066
The following table summarizes the activity of options outstanding that had not yet vested:
Weighted-
Average
Number
Fair Value
of Shares
Per Share
(in thousands)
Unvested as of December 31, 2023
28
$
65.61
Vested
(6)
$
66.73
Unvested as of December 31, 2024
22
$
65.31
F-33
As of December 31, 2024, the total unrecognized compensation expense related to unvested stock options outstanding under
the Plans is $1.2 million. That cost is expected to be recognized over a weighted-average period of 3.0 years.
The total fair value of options vested during 2024, 2023, and 2022 was $0.4 million, $8.7 million, and $15.9 million,
respectively.
Restricted Stock Units and Performance-Based Restricted Stock Units
The following table summarizes the Company’s RSU and PSU activity for the year ended December 31, 2024:
RSUs
PSUs (1)
Weighted-Average
Weighted-Average
Number of
Grant Date Fair
Number of
Grant Date Fair
Shares
Value per Share
Shares
Value per Share
(in thousands)
(in thousands)
Outstanding at December 31, 2023
267
$
269.08
368
$
298.46
Granted
272
$
216.39
59
$
291.51
PSU adjustment (2)
—
$
—
11
$
236.63
Vested
(121)
$
269.29
(155)
$
236.32
Forfeited/canceled
(25)
$
236.33
(8)
$
315.38
Outstanding at December 31, 2024
393
$
234.50
275
$
314.52
(1)
PSUs represent the target number of shares granted that are issuable at the end of the three year performance period. Fair
value for a portion of the PSUs was calculated using a Monte Carlo simulation model.
(2)
PSU adjustment represents the net PSUs awarded above or below their target grants resulting from the achievement of
performance targets established at the grant date.
Employee Stock Purchase Plan
The Board of Directors of the Company adopted the 2018 Employee Stock Purchase Plan (“2018 Purchase Plan”) which
reserved 300,000 shares of Class A common stock for purchase. The 2018 Purchase Plan permits eligible employee participants to
purchase Class A common stock at a price per share which is equal to 85% of the fair market value of Class A common stock on the
last day of an offering period. For the years ended December 31, 2024 and 2023, 36,675 shares and 27,280 shares, respectively, of
Class A common stock were issued under the 2018 Purchase Plan, which resulted in cash proceeds to the Company of approximately
$6.6 million and $5.6 million, respectively. At December 31, 2024, 121,022 shares remained available for issuance under the 2018
Purchase Plan.
In addition, the Company recorded $1.2 million, $1.0 million, and $1.2 million of non-cash compensation expense relating to
the shares issued under the 2018 Purchase Plan for each of the years ended December 31, 2024, 2023, and 2022, respectively.
Non-Cash Compensation Expense
The table below reflects a breakout by category of the non-cash compensation expense amounts recognized on the
Company’s Statements of Operations for the years ended December 31, 2024, 2023, and 2022, respectively:
For the year ended December 31,
2024
2023
2022
(in thousands)
Cost of revenues
$
2,737
$
2,869
$
2,490
Selling, general and administrative
71,637
85,050
97,419
Total cost of non-cash compensation included
in income before provision for income taxes
$
74,374
$
87,919
$
99,909
In addition, the Company capitalized $1.6 million, $1.7 million, and $1.9 million of non-cash compensation for the years
ended December 31, 2024, 2023, and 2022, respectively, to fixed assets.
F-34
14.
INCOME TAXES
As discussed in Note 2, the Company began operating in compliance with REIT requirements for federal income tax
purposes effective January 1, 2016. As a REIT, the Company must distribute at least 90 percent of its taxable income (including
dividends paid to it by its TRSs) except to the extent offset by NOLs. In addition, the Company must meet a number of other
organizational and operational requirements. It is management's intention to adhere to these requirements and maintain the Company's
REIT status. Most states where the Company operates conform to the federal rules recognizing REITs. Certain subsidiaries have made
an election with the Company to be treated as TRSs in conjunction with the Company's REIT election; the TRS elections permit the
Company to engage in certain business activities in which the REIT may not engage directly. A TRS is subject to federal and state
income taxes on the income from these activities. A provision for taxes of the TRSs and of foreign branches of the REIT is included in
its consolidated financial statements.
Income (loss) before provision for income taxes by geographic area is as follows:
For the year ended December 31,
2024
2023
2022
(in thousands)
Domestic
$
797,774
$
377,150
$
438,116
Foreign
(25,108)
171,353
87,727
Total
$
772,666
$
548,503
$
525,843
The provision for income taxes consists of the following components:
For the year ended December 31,
2024
2023
2022
(in thousands)
Current provision:
State
$
2,758
$
8,099
$
6,115
Foreign
34,318
38,360
27,028
Total current
37,076
46,459
33,143
Deferred (benefit) provision for taxes:
Federal
8,021
8,280
(6,856)
State
1,458
1,431
(956)
Foreign
(26,540)
52,003
32,780
Change in valuation allowance
3,974
(57,085)
7,933
Total deferred
(13,087)
4,629
32,901
Total provision for income taxes
$
23,989
$
51,088
$
66,044
A reconciliation of the provision for income taxes at the statutory U.S. Federal tax rate (21%) and the effective income tax
rate is as follows:
For the year ended December 31,
2024
2023
2022
(in thousands)
Statutory federal expense
$
162,260
$
115,186
$
110,427
Rate and permanent differences on non-U.S. earnings (1)
(1,842)
31,722
20,996
State and local tax expense
3,543
9,288
5,585
REIT adjustment
(163,795)
(75,513)
(86,670)
Permanent differences
12,868
11,872
(3,257)
Uncertain tax positions
(293)
14,202
—
Property, equipment, and intangible basis differences
—
—
8,471
Other
7,274
1,416
2,559
Valuation allowance
3,974
(57,085)
7,933
Provision for income taxes
$
23,989
$
51,088
$
66,044
(1)
This item includes the effect of foreign exchange rate changes which were previously shown on a separate line.
F-35
The components of the net noncurrent deferred income tax asset (liability) accounts are as follows:
As of December 31,
2024
2023
(in thousands)
Deferred tax assets:
Net operating losses
$
30,942
$
42,064
Property, equipment, and intangible basis differences
18,217
25,225
Accrued liabilities
14,892
14,945
Non-cash compensation
25,830
29,576
Operating lease liability
254,521
268,107
Deferred revenue
5,735
6,348
Allowance for doubtful accounts
2,854
2,735
Currency translation
64,881
14,467
Other
8,146
14,075
Valuation allowance
(19,326)
(16,115)
Total deferred tax assets, net (1)
406,692
401,427
Deferred tax liabilities:
Property, equipment, and intangible basis differences
(171,763)
(169,744)
Right of use asset
(240,300)
(254,573)
Straight-line rents
(16,877)
(19,029)
Deferred foreign withholding taxes
(8,950)
(8,322)
Other
—
(1,495)
Total deferred tax liabilities, net (1)
$
(31,198)
$
(51,736)
(1)
Of these amounts, $53,974 and $85,172 are included in Other assets and Other long-term liabilities, respectively, on the
accompanying Consolidated Balance Sheets as of December 31, 2024. As of December 31, 2023, $67,473 and $119,209 are
included in Other assets and Other long-term liabilities, respectively, on the accompanying Consolidated Balance Sheet.
A deferred tax asset is reduced by a valuation allowance if based on the weight of all available evidence, including both
positive and negative evidence, it is more likely than not (a likelihood of more than 50%) that the value of such assets will not be
realized. The valuation allowance should be sufficient to reduce the deferred tax asset to the amount that is more likely than not to be
realized. The realization of deferred tax assets, including carryforwards and deductible temporary differences, depends upon the
existence of sufficient taxable income of the same character during the carryback or carryforward period. All sources of taxable
income available to realize the deferred tax asset, including the future reversal of existing temporary differences, future taxable
income exclusive of reversing temporary differences and carryforwards, taxable income in carryback years and tax-planning
strategies, should be considered.
The Company has recorded a valuation allowance for certain deferred tax assets as management believes that it is not “more-
likely-than-not” that the Company will generate sufficient taxable income in future periods to recognize the assets. Valuation
allowances of $19.3 million and $16.1 million were being carried to offset net deferred income tax assets as of December 31, 2024
and 2023, respectively. The net change in the valuation allowance for the years ended December 31, 2024 and 2023 was an increase of
$3.2 million and a decrease of $57.4 million, respectively. The primary reason for the reduction in the valuation allowance in 2023
was the Company released the valuation allowance related to the deferred tax asset balance of the domestic TRS.
The Company has available at December 31, 2024, a federal NOL carry-forward of approximately $377.9 million. $343.7
million of these NOL carry-forwards will expire between 2029 and 2037, and $34.2 million have an indefinite carry-forward. As of
December 31, 2024, $337.7 million of the federal NOLs are attributes of the REIT. The Company may use these NOLs to offset its
REIT taxable income, and thus any required distributions to shareholders may be reduced or eliminated until such time as the NOLs
have been fully utilized. The Internal Revenue Code places limitations upon the future availability of NOLs based upon changes in the
equity of the Company. If these occur, the ability of the Company to offset future income with existing NOLs may be limited. In
addition, the Company has available at December 31, 2024, a foreign NOL carry-forward of $66.5 million and a net state operating
tax loss carry-forward of approximately $225.6 million. These net operating tax loss carry-forwards began to expire in 2025.
The tax losses generated in tax years 2005 and forward remain subject to audit adjustment, and tax years 2017 and forward
are open to examination by the major jurisdictions in which the Company operates.
F-36
The Company is subject to income tax and other taxes in the geographic areas where it holds assets or operates, and the
Company periodically receives notifications of audits, assessments, or other actions by taxing authorities. In certain jurisdictions,
taxing authorities may issue notices and assessments that may not be reflective of the actual tax liability for which the Company will
ultimately be liable. In the process of responding to assessments of taxes that the Company believes are not reflective of the
Company’s actual tax liability, the Company avails itself of both administrative and judicial remedies. The Company evaluates the
circumstances of each notification or assessment based on the information available and, in those instances in which the Company
does not anticipate a successful defense of positions taken in its tax filings, a liability is recorded in the appropriate amount based on
the underlying assessment.
The Company records a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be
taken in a tax return if applicable. As of December 31, 2024 and 2023, the total amount of unrecognized tax benefits are $13.9 million
and $14.2 million, respectively, all of which would impact the effective rate if recognized. The Company expects the unrecognized tax
benefits to change over the next 12 months if the applicable statute of limitations expire and the impact could range from zero to $3.0
million. For the period ended December 31, 2024 the Company recorded penalties and interest expense related to unrecognized tax
benefits of $0.3 million as interest expense.
A reconciliation of the beginning and ending amount of unrecognized tax benefits are as follows:
For the year ended December 31,
2024
2023
2022
(in millions)
Balance, January 1,
$
14,202
$
—
$
—
Additions based on tax positions related to the current year
3,557
5,023
—
Additions and reductions for tax positions of prior years
(1,519)
9,179
—
Reductions for lapse in statute of limitations
(2,331)
—
—
Balance, December 31,
$
13,909
$
14,202
$
—
In connection with a current assessment in Brazil, the taxing authorities have issued income tax deficiencies related to
purchase accounting adjustments for tax years 2017 through 2019. The Company disagrees with the assessment and have filed an
appeal with the higher appellate taxing authorities. The Company estimates that there is a more likely than not probability that the
Company’s position will be sustained upon appeal. Accordingly, no liability has been recorded. The Company will continue to
vigorously contest the adjustments and expect to exhaust all administrative and judicial remedies necessary to resolve the matters,
which could be a lengthy process. There can be no assurance that these matters will be resolved in the Company’s favor, and an
adverse outcome, or any future tax examinations involving similar assertions, could have a material effect on the Company’s results of
operations or cash flows in any one period. As of December 31, 2024, the Company estimates the aggregate range of reasonably
possible losses in excess of amounts accrued to be between zero and $49.0 million; excluding penalties and interest of $63.1 million.
The Company removed the permanent reinvestment assertion as of December 31, 2018 for all foreign earnings of the
Company’s foreign jurisdictions. The Company subsequently also removed its permanent reinvestment assertion on the investment in
the Company’s Guatemala, El Salvador, and Nicaragua subsidiaries. As a result, the Company has recorded cumulative deferred
foreign withholding taxes of $8.9 million at December 31, 2024. No additional income taxes have been provided for any additional
outside basis difference inherent in these entities, as these amounts continue to be indefinitely reinvested in foreign operations except
as noted in Guatemala, El Salvador, and Nicaragua. The deferred incomes taxes related to the Guatemala, El Salvador, and Nicaragua
subsidiaries are immaterial and determining the amount of unrecognized deferred tax liability for any additional outside basis
differences in indefinitely reinvested entities is not practicable.
The U.S. government enacted comprehensive tax legislation in the form of the Tax Cuts and Jobs Act (the “Tax Act”). The
Tax Act subjects a U.S. shareholder to tax on Global Intangible Low-Taxed Income (“GILTI”) earned by certain foreign subsidiaries.
The FASB Staff Q&A, Topic 740, No. 5, Accounting for Global Intangible Low-Taxed Income, states that an entity can make an
accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future
years or to provide for the tax expense related to GILTI in the year the tax is incurred as a period expense only. The Company has
elected to account for GILTI in the year it is incurred.
15.
SEGMENT DATA
The Company operates principally in two business segments: site leasing and site development. The Company’s site leasing
business includes two reportable segments, domestic site leasing and international site leasing. The Company’s business segments are
strategic business units that offer different services. They are managed separately based on the fundamental differences in their
F-37
operations. The site leasing segment includes results of the managed and sublease businesses. The site development segment includes
the results of both consulting and construction related activities. The Company’s CODM is the Company’s Chief Executive Officer.
The CODM utilizes segment operating profit and operating income as his two measures of segment profit in assessing performance
and allocating resources at the reportable segment level. The Company has applied the aggregation criteria to operations within the
international site leasing segment on a basis that is consistent with management’s review of information and performance evaluations
of the individual markets in this region. Revenues, cost of revenues (exclusive of depreciation, accretion and amortization), capital
expenditures (including assets acquired through the issuance of shares of the Company’s Class A common stock) and identifiable
assets pertaining to the segments in which the Company continues to operate are presented below.
Domestic Site
Int'l Site
Site
Leasing
Leasing
Development
Other
Total
For the year ended December 31, 2024
(in thousands)
Revenues (1)
$
1,861,424
$
665,341
$
152,869
$
—
$
2,679,634
Cost of revenues (2)
269,168
193,829
118,730
—
581,727
Operating profit
1,592,256
471,512
34,139
—
2,097,907
Selling, general, and administrative expenses
132,627
64,583
13,983
47,563
258,756
Acquisition and new business initiatives
related adjustments and expenses
14,954
10,992
—
—
25,946
Asset impairment and decommission costs
49,777
57,030
—
1,118
107,925
Depreciation, amortization and accretion
145,041
113,549
3,560
7,367
269,517
Operating income (loss)
1,249,857
225,358
16,596
(56,048)
1,435,763
Other expense, net (principally interest
expense and other income)
(663,097)
(663,097)
Income before income taxes
772,666
Cash capital expenditures (3)
374,339
150,345
1,014
2,598
528,296
For the year ended December 31, 2023
Revenues (1)
$
1,846,554
$
670,381
$
194,649
$
—
$
2,711,584
Cost of revenues (2)
268,572
204,115
139,935
—
612,622
Operating profit
1,577,982
466,266
54,714
—
2,098,962
Selling, general, and administrative expenses
121,782
66,619
21,316
58,219
267,936
Acquisition and new business initiatives
related adjustments and expenses
10,725
10,946
—
—
21,671
Asset impairment and decommission costs
138,699
28,089
372
2,227
169,387
Depreciation, amortization and accretion
457,169
248,758
3,704
6,678
716,309
Operating income (loss)
849,607
111,854
29,322
(67,124)
923,659
Other expense, net (principally interest
expense and other income)
(375,156)
(375,156)
Income before income taxes
548,503
Cash capital expenditures (3)
244,366
118,972
2,573
2,702
368,613
For the year ended December 31, 2022
Revenues (1)
$
1,777,593
$
558,982
$
296,879
$
—
$
2,633,454
Cost of revenues (2)
264,149
181,536
222,965
—
668,650
Operating profit
1,513,444
377,446
73,914
—
1,964,804
Selling, general, and administrative expenses
102,619
62,911
22,911
73,412
261,853
Acquisition and new business initiatives
related adjustments and expenses
13,280
13,527
—
—
26,807
Asset impairment and decommission costs
33,880
9,280
—
—
43,160
Depreciation, amortization and accretion
489,072
209,563
2,521
6,420
707,576
Operating income (loss)
874,593
82,165
48,482
(79,832)
925,408
Other expense, net (principally interest
expense and other income)
(399,565)
(399,565)
Income before income taxes
525,843
Cash capital expenditures (3)
235,787
1,148,941
4,057
5,610
1,394,395
F-38
Domestic Site
Int'l Site
Site
Leasing
Leasing
Development
Other (4)
Total
Assets
(in thousands)
As of December 31, 2024
$
6,206,748
$
3,417,981
$
65,481
$
1,727,126 $
11,417,336
As of December 31, 2023
$
5,876,648
$
3,871,164
$
66,001
$
364,628
$
10,178,441
(1)
For the years ended December 31, 2024, 2023, and 2022, site leasing revenue in Brazil was $379.8 million, $392.0 million,
and $299.5 million, respectively. Other than Brazil, no foreign country represented more than 5% of the Company’s total site
leasing revenues in any of the periods presented.
(2)
Excludes depreciation, amortization, and accretion. Cost of revenues is primarily comprised of rent expense related to the
Company’s leases.
(3)
Includes cash paid for capital expenditures, acquisitions, and right-of-use assets.
(4)
Assets in Other consist primarily of general corporate assets, short-term investments. Assets in Other for the period ended
December 31, 2024 also includes $1.165 billion of cash held in escrow which was used to repay the 2019-1C Tower
Securities.
Total domestic long-lived assets were $5.7 billion and $5.4 billion as of December 31, 2024 and 2023, respectively. Total
international long-lived assets were $3.0 billion and $3.4 billion as of December 31, 2024 and 2023, respectively. Total long-lived
assets in Brazil were $1.7 billion and $2.1 billion as of December 31, 2024 and 2023, respectively. Long-lived assets include property
and equipment, net, intangible assets, net, operating lease right-of-use assets, net, and acquired and other right-of-use assets, net. Other
than Brazil, no foreign country represented more than 5% of the Company’s total long-lived assets in any of the periods presented.
16.
EARNINGS PER SHARE
Basic earnings per share was computed by dividing net income attributable to SBA Communications Corporation by the
weighted-average number of shares of Class A common stock outstanding for each respective period. Diluted earnings per share was
calculated by dividing net income attributable to SBA Communications Corporation by the weighted-average number of shares of
Class A common stock outstanding adjusted for any dilutive Class A common stock equivalents, including unvested RSUs, PSUs, and
shares issuable upon exercise of stock options as determined under the “Treasury Stock” method.
The following table sets forth basic and diluted net income per common share attributable to common shareholders for the
years ended December 31, 2024, 2023, and 2022 (in thousands, except per share data):
For the year ended December 31,
2024
2023
2022
Numerator:
Net income attributable to SBA
Communications Corporation
$
749,536
$
501,812
$
461,429
Denominator:
Basic weighted-average shares outstanding
107,644
108,204
107,957
Dilutive impact of stock options, RSUs, and PSUs
436
703
1,429
Diluted weighted-average shares outstanding
108,080
108,907
109,386
Net income per common share attributable to SBA
Communications Corporation:
Basic
$
6.96
$
4.64
$
4.27
Diluted
$
6.94
$
4.61
$
4.22
For the years ended December 31, 2024, 2023, and 2022, the diluted weighted-average number of common shares
outstanding excluded an immaterial number of shares issuable upon exercise of the Company’s stock options because the impact
would be anti-dilutive.
F-39
17.
COMMITMENTS AND CONTINGENCIES
The Company is obligated under various non-cancelable operating leases for land, office space, equipment, and site leases. In
addition, the Company is obligated under various non-cancelable financing leases for vehicles. The annual minimum lease payments,
including fixed rate escalations as of December 31, 2024 are as follows (in thousands):
Finance Leases
Operating Leases
2025
$
1,921
$
269,389
2026
1,042
265,258
2027
406
263,250
2028
115
259,080
2029
3
250,750
Thereafter
—
2,555,025
Total minimum lease payments
3,487
3,862,752
Less: amount representing interest
(350)
(1,701,433)
Present value of future payments
3,137
2,161,319
Less: current obligations
(1,252)
(259,765)
Long-term obligations
$
1,885
$
1,901,554
Tenant Leases
The annual minimum tower lease income to be received for tower space rental under non-cancelable operating leases,
including fixed rate escalations, as of December 31, 2024 is as follows:
(in thousands)
2025
$
2,105,856
2026
1,858,268
2027
1,616,505
2028
1,333,310
2029
958,933
Thereafter
1,793,532
Total
$
9,666,404
Litigation
The Company is involved in various claims, lawsuits, and proceedings arising in the ordinary course of business. While there
are uncertainties inherent in the ultimate outcome of such matters and it is impossible to presently determine the ultimate costs that
may be incurred, management believes the resolution of such uncertainties and the incurrence of such costs will not have a material
adverse effect on the Company’s consolidated financial position, results of operations or liquidity.
Contingent Purchase Obligations
From time to time, the Company agrees to pay additional consideration (or earnouts) for acquisitions if the towers or
businesses that are acquired meet or exceed certain performance targets in the one year to three years after they have been acquired.
Please refer to Note 2 and Note 7.
18.
CONCENTRATION OF CREDIT RISK
The Company’s credit risks consist primarily of accounts receivable with national, regional, and local wireless service
providers and federal and state government agencies. The Company performs periodic credit evaluations of its customers’ financial
condition and provides allowances for doubtful accounts, as required, based upon factors surrounding the credit risk of specific
customers, historical trends, and other information. The Company generally does not require collateral.
F-40
The following is a list of significant customers (representing at least 10% of revenue for any period reported) and the
percentage of total revenue for the specified time periods derived from such customers:
For the year ended December 31,
Percentage of Total Revenues
2024
2023
2022
T-Mobile
30.5%
32.5%
36.4%
AT&T Wireless
20.6%
19.5%
19.6%
Verizon Wireless
15.1%
14.6%
14.5%
The Company’s site leasing and site development segments derive revenue from these customers. Client percentages of total
revenue in each of the segments are as follows:
For the year ended December 31,
Percentage of Domestic Site Leasing Revenue
2024
2023
2022
T-Mobile
38.1%
40.2%
40.6%
AT&T Wireless
29.6%
28.6%
29.0%
Verizon Wireless
20.1%
19.7%
20.1%
For the year ended December 31,
Percentage of International Site Leasing Revenue
2024
2023
2022
Telefonica
21.3%
22.5%
20.7%
Claro
19.2%
20.2%
19.0%
TIM
15.9%
15.7%
17.3%
For the year ended December 31,
Percentage of Site Development Revenue
2024
2023
2022
T-Mobile
69.9%
71.5%
80.1%
Verizon Wireless
20.1%
16.8%
7.8%
Five customers comprised 61.4% and 65.6% of total gross accounts receivable at December 31, 2024 and 2023, respectively.
19.
DEFINED CONTRIBUTION PLAN
The Company has a defined contribution profit sharing plan under Section 401(k) of the Internal Revenue Code that provides
for voluntary employee contributions up to the limitations set forth in Section 402(g) of the Internal Revenue Code. Employees have
the opportunity to participate following completion of three months of employment and must be 21 years of age. Employer matching
begins immediately upon the employee’s participation in the plan.
The Company makes a discretionary matching contribution of 75% (increased to 100% effective January 1, 2025) of an
employee’s contributions up to a maximum of $4,000 annually. Company matching contributions were approximately $3.3 million,
$3.4 million, and $3.2 million for the years ended December 31, 2024, 2023, and 2022, respectively.
20.
REDEEMABLE NONCONTROLLING INTERESTS
The Company allocates income and losses to its redeemable noncontrolling interest holders based on the applicable membership
interest percentage. At each reporting period, the redeemable noncontrolling interest is recognized at the greater of (1) the initial carrying
amount of the noncontrolling interest as adjusted for accumulated income or loss attributable to the noncontrolling interest holder or (2)
the redemption value as of the balance sheet date. Adjustments to the carrying amount of redeemable noncontrolling interest are charged
against retained earnings (or additional paid-in capital if there are no retained earnings). The fair value of the redeemable noncontrolling
interest is estimated using Level 3 inputs.
F-41
The components of redeemable noncontrolling interests are as follows (in thousands):
December 31,
December 31,
2024
2023
Beginning balance
$
35,047
$
31,735
Net loss attributable to noncontrolling interests
(859)
(4,397)
Foreign currency translation adjustments
618
(899)
Purchase of noncontrolling interests
1,865
—
Contribution from joint venture partner
5,730
1,200
Adjustment to redemption amount
11,731
7,408
Ending balance
$
54,132
$
35,047
21.
DERIVATIVES AND HEDGING ACTIVITIES
The Company enters into interest rate swaps to hedge the future interest expense from variable rate debt and reduce the
Company’s exposure to fluctuations in interest rates. On August 4, 2020, the Company, through its wholly owned subsidiary,
SBA Senior Finance II, entered into an interest rate swap which swapped $1.95 billion of notional value accruing interest at one
month LIBOR plus 175 basis points for an all-in fixed rate of 1.874% per annum through the maturity date of the 2018 Term
Loan. The Company designated this interest rate swap as a cash flow hedge as it is expected to be highly effective at offsetting
changes in cash flows of the LIBOR based component interest payments of its 2018 Term Loan.
On August 4, 2020, the Company also terminated its existing interest rate swaps, which were previously de-designated as
cash flow hedges. There was no cash transferred in connection with the termination of these swaps. The Company reclassifies the fair
value of its interest rate swaps recorded in Accumulated other comprehensive loss, net on their de-designation date to non-cash
interest expense on the Consolidated Statements of Operations over their respective remaining term end dates which range from 2023
to 2025.
On June 21, 2023, the Company, through its wholly owned subsidiary, SBA Senior Finance II, amended its existing interest
rate swap agreement which swapped $1.95 billion of notional value accruing interest at one month Term SOFR plus 185 basis points
for an all-in fixed rate of 1.900% per annum from August 1, 2023 through January 25, 2024 (the repayment date of the 2018 Term
Loan and issuance date of the 2024 Term Loan). The swap remains in effect under the 2024 Term Loan (as amended on October 2,
2024) and swaps $1.95 billion of notional value accruing interest at one month Term SOFR plus 175 basis points for an all-in fixed
rate of 1.800% per annum through March 31, 2025.
On November 3, 2023, the Company, through its wholly owned subsidiary, SBA Senior Finance II, entered into a forward-
starting interest rate swap agreement which will swap $1.0 billion of notional value accruing interest at one month Term SOFR plus
175 basis points for an all-in fixed rate of 5.580% per annum. On September 6, 2024, the Company, through its wholly owned
subsidiary, SBA Senior Finance II, entered into an additional forward-starting interest rate swap agreement to swap $1.0 billion of
notional value accruing interest at one month Term SOFR plus 175 basis points for an all-in fixed rate of 4.750% per annum
(collectively the “forward-starting swaps”). The forward-starting swaps have an effective start date of March 31, 2025 (coinciding
with the expiration date of the current 0.050%, $1.95 billion notional value swap) and a maturity date of April 11, 2028. The
combined notional value of both forward-starting swaps of $2.0 billion will effectively fix one month term SOFR for a blended all-in
fixed rate of 5.165% per annum through April 11, 2028.
On September 11, 2024, the Company entered into a treasury lock agreement to fix the three-year treasury rate at 3.3985%
for $620.0 million of notional value related to the 2024-2C Tower Securities issued on October 11, 2024. The treasury lock
agreement was terminated and settled upon issuance of the 2024-2C Tower Securities, and the Company recognized an $8.2 million
gain in other comprehensive income which is being amortized to interest expense over the life of the 2024-2C Tower Securities.
After consideration of the treasury lock agreement, the all-in fixed rate on the 2024-2C Tower Securities is 4.654% per annum.
F-42
As of December 31, 2024, the hedges remain highly effective; therefore, changes in fair value are recorded in Accumulated
other comprehensive loss, net. The table below outlines the effects of the Company’s interest rate swaps on the Consolidated Balance
Sheets as of December 31, 2024 and 2023.
Fair Value as of
Balance Sheet
December 31,
December 31,
Location
2024
2023
Derivatives Designated as Hedging Instruments
(in thousands)
Interest rate swap agreements in a fair value asset position
Other assets
$
50,589
$
104,674
Interest rate swap agreement in a fair value liability position
Other long-term
liabilities
$
—
$
19,573
Accumulated other comprehensive loss, net includes an aggregate $50.9 million gain and a $51.5 million gain as of
December 31, 2024 and 2023, respectively.
The Company is exposed to counterparty credit risk to the extent that a counterparty fails to meet the terms of a contract.
The Company’s exposure is limited to the current value of the contract at the time the counterparty fails to perform.
The cash flows associated with these activities are reported in Net cash provided by operating activities on the Consolidated
Statements of Cash Flows.
The table below outlines the effects of the Company’s derivatives on the Consolidated Statements of Operations and
Consolidated Statements of Shareholders’ Deficit for the fiscal years ended December 31, 2024, 2023, and 2022.
For the year ended December 31,
2024
2023
2022
Cash Flow Hedge - Interest Rate Swap Agreement
(in thousands)
Change in fair value recorded in Accumulated other comprehensive
loss, net
$
(34,513) $
(97,760) $
122,536
Gain on settlement of hedging agreement recorded in Accumulated other
comprehensive loss, net
8,187
—
—
Gain reclassified from Accumulated other comprehensive
loss, net into earnings
$
(608) $
—
$
—
Derivatives Not Designated as Hedges - Interest Rate Swap Agreements
Amount reclassified from Accumulated other comprehensive
loss, net into Non-cash interest expense
$
26,317 $
29,627 $
44,887
F-43
22.
QUARTERLY FINANCIAL DATA (unaudited)
Quarter Ended
December 31,
September 30,
June 30,
March 31,
2024
2024
2024
2024
(in thousands, except per share amounts)
Revenues
$
693,700 $
667,595 $
660,477 $
657,862
Operating income
382,339
375,596
354,470
323,358
Depreciation, accretion, and amortization
(65,073)
(63,515)
(64,179)
(76,750)
Net income attributable to SBA Communications Corporation
173,629
258,534
162,830
154,543
Net income per common share - basic
$
1.61 $
2.41 $
1.52 $
1.43
Net income per common share - diluted
1.61
2.40
1.51
1.42
Quarter Ended
December 31,
September 30,
June 30,
March 31,
2023
2023
2023
2023
(in thousands, except per share amounts)
Revenues
$
675,024 $
682,544 $
678,500 $
675,516
Operating income
209,687
248,604
241,227
224,141
Depreciation, accretion, and amortization
(171,400)
(180,674)
(181,820)
(182,415)
Net income attributable to SBA Communications Corporation
109,528
87,419
203,648
101,217
Net income per common share - basic
$
1.01 $
0.81 $
1.88 $
0.94
Net income per common share - diluted
1.01
0.80
1.87
0.93
Because net income per share amounts are calculated using the weighted-average number of common and dilutive common
shares outstanding during each quarter, the sum of the per share amounts for the four quarters may not equal the total net income per
share amounts for the year.
Performance Graph
SBA Communications Corporation’s (“SBA” or “we”) Class A Common Stock began trading on The
Nasdaq National Market on June 16, 1999 when its initial public offering commenced and is currently
traded on the Nasdaq Global Select Market. The following graph shows the total return to the
shareholders of an investment in SBA’s Class A Common Stock as compared to (1) an investment in
the S&P 500 Index, (2) an investment in a peer group made up of American Tower Corporation and
Crown Castle Inc., the comparable large domestic public wireless tower companies, and (3) an
investment in the FTSE NAREIT All Equity REITs Index.
Total shareholder return is determined by dividing (1) the sum of (A) the cumulative amount of
dividends for a given period (assuming dividend reinvestment) and (B) the change in share price
between the beginning and end of the measurement period, by (2) the share price at the beginning
of the measurement period.
INDEXED RETURNS
Base
Period
Years Ending
Company Name / Index
12/31/19
2020
2021
2022
2023
2024
SBA Communications Corporation
$100.00
$117.81
$163.70
$119.01
$109.31
$89.44
S&P 500 Index
$100.00
$118.40
$152.39
$124.79
$157.59
$197.02
FTSE NAREIT All Equity REITs Index
$100.00
$94.88
$134.06
$100.62
$112.04
$117.56
Large Public Tower Company Peers
$100.00
$105.39
$140.99
$100.87
$100.41
$86.78
Reflects $100 invested on December 31, 2019 in (1) the Class A Common Stock of SBA, (2) the
basket of companies comprising the S&P 500 Index, (3) the companies comprising the group of Large
Public Tower Company Peers, and (4) the basket of companies comprising the FTSE NAREIT All
Equity REITs Index.
$0
$50
$100
$150
$200
12/31/19
2020
2021
2022
2023
2024
In Dollars
Total Shareholder Returns
SBA Communications Corporation
S&P 500 Index
FTSE NAREIT All Equity REITs Index
Large Public Tower Company Peers
Required Disclosures Non-GAAP Financial Measures in Accordance with Regulation G
SBA often makes disclosures of non-GAAP financial measures, such as (1) Funds from Operations
(“FFO”), Adjusted Funds from Operations (“AFFO”) and AFFO per share; (2) Adjusted EBITDA and
Adjusted EBITDA Margin; (3) Tower Cash Flow and Tower Cash Flow Margin; (4) Cash Site Leasing
Revenue; and (5) Net Debt and Leverage Ratio.
We believe that FFO, AFFO and AFFO per share, which are metrics used by our public company
peers in the communication site industry, provide investors useful indicators of the financial
performance of our business and permit investors an additional tool to evaluate the performance of
our business against those of our two principal competitors. FFO, AFFO, and AFFO per share are
also used to address questions we receive from analysts and investors who routinely assess our
operating performance on the basis of these performance measures, which are considered industry
standards. We believe that FFO helps investors or other interested parties meaningfully evaluate
financial performance by excluding the impact of our asset base (primarily depreciation, amortization
and accretion and asset impairment and decommission costs). We believe that AFFO and AFFO per
share help investors or other interested parties meaningfully evaluate our financial performance as
they include (1) the impact of our capital structure (primarily interest expense on our outstanding debt)
and (2) sustaining capital expenditures and exclude the impact of (1) our asset base (primarily
depreciation, amortization and accretion and asset impairment and decommission costs) and
(2) certain non-cash items, including straight-lined revenues and expenses related to fixed
escalations and rent free periods and the non-cash portion of our reported tax provision. GAAP
requires rental revenues and expenses related to leases that contain specified rental increases over
the life of the lease to be recognized evenly over the life of the lease. In accordance with GAAP, if
payment terms call for fixed escalations, or rent free periods, the revenue or expense is recognized
on a straight-lined basis over the fixed, non-cancelable term of the contract. We only use AFFO as a
performance measure. AFFO should be considered only as a supplement to net income computed in
accordance with GAAP as a measure of our performance and should not be considered as an
alternative to cash flows from operations or as residual cash flow available for discretionary
investment. We believe our definition of FFO is consistent with how that term is defined by the
National Association of Real Estate Investment Trusts (“NAREIT”) and that our definition and use of
AFFO and AFFO per share is consistent with those reported by the other communication site
companies.
We believe that Adjusted EBITDA is useful to investors or other interested parties in evaluating our
financial performance. Adjusted EBITDA is the primary measure used by management (1) to evaluate
the economic productivity of our operations and (2) for purposes of making decisions about allocating
resources to, and assessing the performance of, our operations. Management believes that Adjusted
EBITDA helps investors or other interested parties meaningfully evaluate and compare the results of
our operations (1) from period to period and (2) to our competitors, by excluding the impact of our
capital structure (primarily interest charges from our outstanding debt) and asset base (primarily
depreciation, amortization and accretion) from our financial results. Management also believes
Adjusted EBITDA is frequently used by investors or other interested parties in the evaluation of REITs.
In addition, Adjusted EBITDA is similar to the measure of current financial performance generally
used in our debt covenant calculations. Adjusted EBITDA should be considered only as a supplement
to net income computed in accordance with GAAP as a measure of our performance.
We believe that Tower Cash Flow, Tower Cash Flow Margin and Cash Site Leasing Revenue are
useful indicators of the performance of our site leasing operations.
In addition, Tower Cash Flow, Adjusted EBITDA, Net Debt and Leverage Ratio are components of
the calculations used by our lenders to determine compliance with certain covenants under our debt
instruments. These non-GAAP financial measures are not intended to be an alternative to any of the
financial measures provided in our results of operations or our balance sheet as determined in
accordance with GAAP.
FFO, AFFO and AFFO per share
The table below sets forth the reconciliation of FFO, AFFO and AFFO per share to their most
comparable GAAP measurement.
For the year
ended December 31,
2024
2023
($ in thousands, except per share
amounts)
Net income
$
748,677 $
497,415
Real estate related depreciation, amortization and accretion
263,191
709,832
Asset impairment and decommission costs
107,925
169,387
FFO
$
1,119,793 $
1,376,634
Adjustments to FFO:
Non-cash straight-line leasing revenue
(10,851)
(25,206)
Non-cash straight-line ground lease expense
(7,668)
(686)
Non-cash compensation
74,374
87,919
Adjustment for non-cash portion of tax (benefit) provision
(13,380)
20,354
Non-real estate related depreciation, amortization, and accretion
6,326
6,477
Amortization of deferred financing costs and debt discounts
48,926
56,141
Loss from extinguishment of debt, net
5,940
–
Other expense (income), net
250,415
(63,053)
Acquisition and new business initiatives related adjustments and
expenses
25,946
21,671
Non-discretionary cash capital expenditures
(54,742)
(56,078)
AFFO
$
1,445,079
$
1,424,173
Diluted weighted average number of common shares
108,080
108,907
AFFO per share
$
13.37 $
13.08
Adjusted EBITDA, Annualized Adjusted EBITDA and Adjusted EBITDA Margin
The table below sets forth the calculation of Annualized Adjusted EBITDA and the calculation of
Adjusted EBITDA Margin. See our Form 10-K which accompanies this annual report for a
discussion and reconciliation of full year Adjusted EBITDA.
For the quarter ended December 31,
2024
2023
($ in thousands)
Net income
$
178,791 $
109,528
Non-cash straight-line leasing revenue
(228)
(3,828)
Non-cash straight-line ground lease expense
(2,242)
(821)
Non-cash compensation
17,934
22,089
Loss from extinguishment of debt, net
1,512
–
Other expense (income), net
124,606
(33,090)
Acquisition and new business initiatives related adjustments
and expenses
6,567
5,049
Asset impairment and decommission costs
19,997
77,067
Interest income
(20,603)
(5,541)
Total interest expense(1)
120,950
109,894
Depreciation, accretion and amortization
65,073
171,400
(Benefit) provision for taxes(2)
(23,107)
28,914
Adjusted EBITDA
$
489,250
$
480,661
Annualized Adjusted EBITDA (3)
$
1,957,000
$
1,922,644
(1) Total interest expense includes interest expense, non-cash interest expense, and amortization of deferred
financing fees.
(2) Includes franchise and gross receipts taxes reflected in the Statements of Operations in selling, general
and administrative expenses.
(3) Annualized Adjusted EBITDA is calculated as Adjusted EBITDA for the most recent quarter multiplied by
four.
For the year ended
December 31, 2024
($ in thousands)
Total Revenues
$
2,679,634
Non-cash straight-line leasing revenue
(10,851)
Total revenues minus non-cash straight-line leasing revenue
$
2,668,783
Adjusted EBITDA
$
1,894,345
Adjusted EBITDA Margin
71.0%
Cash Site Leasing Revenue, Tower Cash Flow and Tower Cash Flow Margin
The table below sets forth the reconciliations of Cash Site Leasing Revenue and Tower Cash Flow
to their most comparable GAAP measurement, and the calculation of Tower Cash Flow Margin.
For the year ended December 31,
2024
2023
($ in thousands)
Site leasing revenue
$
2,526,765
$
2,516,935
Non-cash straight-line site leasing revenue
(10,851)
(25,206)
Cash Site Leasing Revenue
$
2,515,914
$
2,491,729
Site leasing cost of revenues (excluding depreciation,
accretion, and amortization)
(462,997)
(472,687)
Non-cash straight-line ground lease expense
(7,668)
(686)
Tower Cash Flow
$
2,045,249
$
2,018,356
Tower Cash Flow Margin
81.3%
81.0%
Special Note Regarding Forward-Looking Statements
This annual report contains forward-looking statements that concern expectations, beliefs,
projections, strategies, anticipated events or trends regarding (1) our domestic segment, including its
ability to experience solid long-term organic growth and perform well, (2) our ability to increase the
predictability and stability of our long-term cash flows, grow the core business and improve the overall
quality of our assets, (3) our future capital allocation, including for asset acquisitions, dividends
(including growth thereof) and share repurchases, (4) our ability to continue to produce strong
financial and operating results and maximize shareholder value, (5) our potential leasing environment
and key growth drivers in 2025 and beyond, (6) customer activity, continued network investment and
demand for our wireless communications infrastructure, both domestically and internationally, and
the impact of customer 5G deployment on such demand, (7) churn and market rationalization, (8) the
Millicom transaction and its benefits, (9) our ability to maximize future business opportunities and
progress towards focusing on achieving scale or exiting markets where we don’t see an opportunity
to achieve scale, and (10) the strength of our customers. These forward-looking statements are
qualified in their entirety by cautionary statements set forth under “Special Note Regarding Forward-
Looking Statements” and the risk factor disclosures contained in our Form 10-K filed with the
Securities and Exchange Commission on February 26, 2025 and included in this annual report.
ESSENTIAL
INFRASTRUCTURE
®
© 2025 SBA Communications Corporation. All Rights Reserved. The SBA logo, Your Signal Starts Here,
Building Better Wireless, Essential Infrastructure and SBA Edge are all registered trademarks owned by
SBA Telecommunications, Inc. and affiliated SBA companies. Other brands and product names mentioned
herein may be trademarks or registered trademarks of their respective companies.
SENIOR MANAGEMENT
DIRECTORS
Jeffrey A. Stoops
Chairman of the Board
Brendan T. Cavanagh
Director, President and
Chief Executive Officer
Steven E. Bernstein
Founder and Director
Kevin L. Beebe
Director
Laurie Bowen
Director
Mary S. Chan
Director
Jay L. Johnson
Director
George R. Krouse Jr.
Director
Jack Langer
Lead Independent Director
Amy E. Wilson
Director
Brendan T. Cavanagh
President and Chief Executive Officer
Richard M. Cane
Executive Vice President
and President, International
Mark R. Ciarfella
Executive Vice President,
Operations
Donald E. Day
Executive Vice President,
Site Leasing
Joshua Koenig
Executive Vice President,
Chief Administrative Officer
and General Counsel
Marc Montagner
Executive Vice President
and Chief Financial Officer
Brian M. Allen
Senior Vice President,
Site Leasing
Elvis T. Clemetson
Senior Vice President
and Chief Information Officer
Michelle Eisner
Senior Vice President and
Chief Human Resources Officer
Larry Harris
Senior Vice President,
U.S. Business Development
Saul Kredi
Vice President
and Chief Accounting Officer
Neil H. Seidman
Senior Vice President,
Mergers and Acquisitions
Nichole Thomas
Senior Vice President,
Services
COMMON STOCK TRADING SYMBOL
Class A shares of SBA Communications
Corporation are traded on the NASDAQ
Global Select Market under the symbol:
SBAC
INTERNET WEBSITE
www.sbasite.com
HEADQUARTERS
8051 Congress Avenue
Boca Raton, FL 33487-1307
T + 561.995.7670
T + 800.487.SITE (7483)
REGIONAL OFFICES
North America
Montreal, Canada
Alpharetta, Georgia
Biddeford, Maine
Charlotte, North Carolina
Chicago, Illinois
Costa Mesa, California
Dallas, Texas
Fenton, Missouri
Indianapolis, Indiana
Nashville, Tennessee
Pelham, Alabama
Pittsburgh, Pennsylvania
Woodbridge, New Jersey
Central America
Guatemala City, Guatemala
Managua, Nicaragua
Panama City, Panama
San Jose, Costa Rica
San Salvador, El Salvador
South America
Lima, Peru
Quito, Ecuador
Santiago, Chile
Sao Paulo, Brazil
Africa
Paarl, South Africa
Dar es Salaam, Tanzania
AUDITORS
Ernst & Young LLP
5100 Town Center Circle
Suite 500
Boca Raton, FL 33486
TRANSFER AGENT
Computershare Trust Company, N.A.
P.O. Box 43078
Providence, RI 02940-3078
www.computershare.com
INVESTOR RELATIONS
SBA Communications Corporation
8051 Congress Avenue
Boca Raton, FL 33487-1307
ir@sbasite.com
NOTICE OF ANNUAL MEETING
The annual meeting of shareholders
will be held at 10:00 AM (Eastern)
on May 23, 2025 at the
corporate headquarters:
8051 Congress Avenue
Boca Raton, FL 33487-1307
SBA COMMUNICATIONS
8051 Congress Avenue, Boca Raton, FL 33487
800.487.SITE
ir@sbasite.com
www.sbasite.com