Windstream’s SD-WAN customer base tops 2,700

Windstream also had more than 22,000 SD-WAN endpoint locations. (Windstream)

As Windstream continues to battle against former spinoff Uniti Group, which it says it is pursuing through a combination of litigation and negotiation, the company managed to end 2019 by scoring some strong SD-WAN numbers and meeting its goal to extend its fiber reach.

During its fourth quarter earnings call, Windstream CEO Tony Thomas touted the company’s SD-WAN achievements, noting that the company ended the year with 2,700 SD-WAN customers, making it the largest in the country. It also had more than 22,000 SD-WAN endpoint locations. When looking at the number of contracts the company has, that number grows to 3,200 SD-WAN contracts and 27,000 endpoint locations.

Windstream also reported that its strategic product revenue (which includes SD-WAN) increased 38% year-over-year and now makes up 13% of the company’s total enterprise service revenue.

On the broadband front, Windstream reported that it increased its broadband customers by 28,300 in 2019, which is an increase of 96% compared to 2018. The company added 9,300 new broadband subscribers in the fourth quarter alone.

In terms of its fiber footprint, the company said it met its goal of expanding its Kinetic Business 1-Gig Fiber Internet to 100,000 business locations. It added that by the end of the fourth quarter 53% of its customers had speeds of 25 Mbps or faster.

On the consumer front, the company said that 42% of its homes in its ILEC footprint have available speeds of 100 Mbps or higher and 70% have available speeds of 25 Mbps or higher. Windstream executives noted that only 28% of its Kinetic customers that are eligible for speeds of 50 Mbps or higher are actually enjoying those speeds, which means the company has the opportunity to try to upsell those customers.

The metrics

Despite its wins in SD-WAN and broadband, the company’s overall financials continue to drag. Windstream’s adjusted total revenues for the quarter were $1.24 billion, which is down from $1.35 billion in the same period a year ago. For the entire year, Windstream reported total revenues of $5.1 billion compared to $5.5 billion in 2018.

The company’s capital expenditures were $250 million in the fourth quarter, compared to $207 million in the same period a year ago. For the entire year, Windstream reported capital expenditures of $879 million compared to $783 million in 2018.

2020 Priorities

Windstream executives said that they remain focused on exiting their current Chapter 11 bankruptcy with a new capital structure. The company filed for Chapter 11 reorganization in the US. Bankruptcy Court for the Southern District of New York a year ago.

Windstream also said that in 2020 it wants to continue to increase its broadband speeds of its Kinetic network and make strategic investments in that network. The company also plans to build on its SD-WAN momentum by adding more enhanced services through the customer portals and interfaces.

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The company is continuing its battle against former spinoff Uniti Group. Barring any last-minute negotiations, the case is expected to go to trial March 2 with Judge Robert Drain of the U.S. Bankruptcy Court for the Southern District of New York.

A year ago, Windstream lost a legal battle with New York hedge fund Aurelius Capital Management over whether it had defaulted on bonds by spinning off the Uniti Group. As part of that spinoff, Windstream transferred copper-based network assets to Uniti, which Windstream leased back from Uniti to serve its residential and business customers across its 18-state footprint.