Crown Castle Raises 2026 Adjusted EBITDA Outlook by $25 Million
Key Facts
Crown Castle raised the midpoint of its 2026 adjusted earnings before interest, taxes, depreciation and amortization outlook by $25 million, according to its third-quarter earnings release issued on October 21. The midpoint now stands at $2,715 million, compared with $2,690 million previously. The revision concerns a non-GAAP earnings measure, which the company still expects to decline year on year. Adjusted EBITDA was $2,863 million in 2025. The projected level for the current year therefore remains 5% below the previous year, despite the increase in the October update.
The quarterly results showed net income fell to $283 million in the third quarter of 2026 from $323 million in the corresponding period of 2025. The decline was $40 million, or 12% year on year, according to the company's release. Adjusted EBITDA also fell to $673 million from $718 million, a decline of $45 million, or 6%. Adjusted funds from operations, by contrast, rose to $530 million from $490 million a year earlier. The increase in this measure was $40 million, representing year-on-year growth of 8%. Site rental revenue was $966 million, compared with $1,012 million in the third quarter of the previous year.
The chief financial officer attributed the higher outlook to "increased ground lease purchase activity and additional operating efficiencies," according to his comments in the earnings release. The update also included a $20 million increase in the site rental revenue outlook. The company said the increase was tied to contract term extensions that raise revenue recognized on a straight-line basis. The expected efficiency gains are part of a transformation program management outlined at the RBC conference in September, according to Investing.com. The program includes upgrading information technology systems, changing the workforce structure and accelerating purchases of ground lease rights beneath towers.
The results follow the completion of the sale of the fiber and small cell businesses on May 1, 2026, according to the company's quarterly report. Crown Castle received total cash proceeds of $8.4 billion from the transaction. The company owns, operates and leases about 40,000 communications towers in the United States, according to its earnings call announcement. On its financial structure, management outlined a leverage target of between 6.0 and 6.5 times at the RBC conference in September. It said the range was consistent with its focus on maintaining an investment-grade balance sheet, according to Investing.com's coverage of the conference.
In trading, the company's shares, listed under the ticker CCI, closed at $78.65 in the October 21 session, according to EL7 data. The stock had ended the previous session at $81.14. The regular session closed before the earnings announcement, which the company had scheduled for after the market close. Ahead of the announcement, BMO Capital lowered its price target on the stock to $93 from $95, according to Investing.com. The firm maintained its Outperform rating and attributed the price target cut to higher interest rates.
Chief Financial Officer Sunit Patel had already outlined the longer-term margin improvement target on the April 22, 2026 earnings call. He said at the time: "I think we can achieve additional margin improvement well beyond 200 basis points by 2030, alongside the reduction we have already made," according to the call transcript published by The Motley Fool. The announcement of this target therefore predates the October outlook update. In a separate presentation at the Citi conference in September, management outlined its view of the organic growth trajectory, according to Investing.com. It expected 2026 to mark the trough in that growth, with improvement beginning in 2027 and beyond.