“And following the completion of our network evolution initiative, capital expenditures, excluding line extensions as a percentage of revenue, should decline to below 2022 level, which has important long-term cash flow implications.”

In context

“$100 per passing to evolve the network to offer multiple gigabit speeds. There has been no change to our longer-term network evolution CapEx outlook. We also continue to expect 2023 line extension capital expenditures to total approximately $4 billion. We are working through our 2024 operating plan right now. Given the greater subsidized rural passings and construction opportunity we currently see, we may partially fund that opportunity by very modestly slowing our network evolution plan, as Chris mentioned. And as we complete our 2024 plans, we will provide a more detailed outlook on our fourth quarter 2023 call in January. I want to highlight that capital expenditures, excluding line extensions and network evolution as a percentage of total revenue, have remained consistent since 2021. And following the completion of our network evolution initiative, capital expenditures, excluding line extensions as a percentage of revenue, should decline to below 2022 level, which has important long-term cash flow implications. As Slide 10 shows, we generated $1.1 billion of free cash flow this quarter versus $1.5 billion in the third quarter of last year. The decline was primarily driven by higher CapEx, mostly driven by our network evolution and expansion initiatives. A couple of brief comments on working capital and cash taxes before turning to the balance sheet. Excluding the impact of mobile devices, we now expect our full year 2023 change in working capital to be negative by a few hundred million dollars, given the timing of capital expenditures and lower-than-expected accrued programming at year-end. On cash taxes, we did have a lower cash tax payment in the third quarter, which is just a timing difference. The full year cash tax outlook, which I provided during our fourth quarter 2022 call, still stand.”