0001558370-24-007776 | 10-Q | XBRL Viewer

Network Connectivity for Eligible Communities

Summary of revenues

Revenue accounted for in accordance with ASC 606 consisted of the following for the periods presented below (in thousands):


	Three months ended March 31,2024
	International		US
	Telecom		Telecom		Total
Services transferred over time	$	88,560	$	78,043	$	166,603
Goods and services transferred at a point in time		3,034		3,271		6,305
Total revenue accounted for under ASC 606	$	91,594	$	81,314	$	172,908
Operating lease income		72		2,034		2,106
Government grant revenue (1)		1,393		10,387		11,780
Total revenue	$	93,059	$	93,735	$	186,794


	Three months ended March 31,2023
	International		US
	Telecom		Telecom		Total
Services transferred over time	$	85,680	$	81,072	$	166,752
Goods and services transferred at a point in time		3,259		2,546		5,805
Total revenue accounted for under ASC 606	$	88,939	$	83,618	$	172,557
Operating lease income		72		1,831		1,903
Government grant revenue (1)		1,397		9,917		11,314
Total revenue	$	90,408	$	95,366	$	185,774

(1)

Revenue recognized from CAF II, USF and RDOF programs. Refer to Note 8.

Remove And Replace Program

Schedule of grant funds

The Company has also been awarded construction grants to build network connectivity for eligible communities. The funding of these grants, used to reimburse the Company for its construction costs, is generally distributed after the Company incurs reimbursable costs. Completion deadlines begin in 2024 and once these projects are constructed, the Company is obligated to provide service to the participants. The Company expects to meet all requirements associated with these grants. A roll forward of the Company’s grant awards is below (in thousands).


		Amount
Grants awarded, December 31, 2023	$	100,149
New grants		—
Construction complete		—
Grants awarded, March 31, 2024	$	100,149

Schedule of grant funds

A summary of the amounts spent and reimbursed under the Replace and Remove Program is below (in thousands):


	Capital		Operating		Total

Total spend, December 31, 2023	$	49,262	$	15,126	$	64,388
Amounts spent		11,734		4,568		16,302
Total spend, March 31, 2024	$	60,996	$	19,694	$	80,690

Total reimbursements, December 31, 2023	$	(12,773)	$	(4,354)	$	(17,127)
Reimbursements received		(8,586)		(5,843)		(14,429)
Total reimbursements, March 31, 2024	$	(21,359)	$	(10,197)	$	(31,556)

Amount pending reimbursement	$	39,637	$	9,497	$	49,134


	Capital		Operating		Total

Total spend, December 31, 2022	$	1,836	$	1,489	$	3,325
Amounts spent		1,485		1,900		3,385
Total spend, March 31, 2023	$	3,321	$	3,389	$	6,710

Amount pending reimbursement	$	3,321	$	3,389	$	6,710

Communication services

Summary of revenues

The Company recorded the amounts below as communication services revenue for the reported periods (in thousands):


	Three months ended
	March 31, 2024

	US Telecom		International Telecom		Total

High cost support	$	3,455	$	1,393	$	4,848
CAF II		6,787		—		6,787
RDOF		145		—		145
ECF		6,813		—		6,813
RHC		3,437		—		3,437
Other		6,701		315		7,016
Total	$	27,338	$	1,708	$	29,046


	Three months ended
	March 31, 2023

	US Telecom		International Telecom		Total

High cost support	$	2,494	$	1,397	$	3,891
CAF II		6,815		—		6,815
RDOF		608		—		608
ECF		8,067		—		8,067
RHC		2,900		—		2,900
Other		4,693		4		4,697
Total	$	25,577	$	1,401	$	26,978

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

LONG-TERM DEBT - Quarterly Payments Dates (Details) - 2023 CoBank Term Loan - 2023 CoBank Credit Facility	Jul. 13, 2023 USD ($)
Quarterly Payment, December 31, 2023 - June 30, 2025
Debt Instrument [Line Items]
Quarterly repayments	$ 812,500
Interest rate	2.50%
Quarterly Payment, September 30, 2025 - June 30, 2026
Debt Instrument [Line Items]
Quarterly repayments	$ 1,625,000
Interest rate	5.00%
Quarterly Payment, September 30, 2026 - June 30,2029
Debt Instrument [Line Items]
Quarterly repayments	$ 2,437,500
Interest rate	7.50%

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

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FAIR VALUE MEASUREMENTS AND INVESTMENTS

FAIR VALUE MEASUREMENTS AND INVESTMENTS (Tables)

3 Months Ended

Mar. 31, 2024

Schedule of assets and liabilities of the entity measured at fair value on a recurring basis

Assets and liabilities of the Company measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023 are summarized as follows (in thousands):


	March 31, 2024
	Significant Other
	Quoted Prices in		Unobservable
	Active Markets		Inputs
Description	(Level 1)		(Level 3)		Total
Short term investments	$	300	$	—	$	300
Other investments		—		1,076		1,076
Employee benefit plan investments		2,991		—		2,991
Alaska Communications redeemable common units		—		(8,419)		(8,419)
Alloy redeemable common units		—		(14,760)		(14,760)
Warrants on Alaska Communications redeemable common units		—		(249)		(249)
Total assets and liabilities measured at fair value	$	3,291	$	(22,352)	$	(19,061)


	December 31, 2023
	Significant Other
	Quoted Prices in		Unobservable
	Active Markets		Inputs
Description	(Level 1)		(Level 3)		Total
Short term investments	$	300	$	—	$	300
Other investments		—		1,197		1,197
Employee benefit plan investments		3,014		—		3,014
Alaska Communications redeemable common units		—		(11,063)		(11,063)
Alloy redeemable common units		—		(14,760)		(14,760)
Warrants on Alaska Communications redeemable common units		—		(249)		(249)
Total assets and liabilities measured at fair value	$	3,314	$	(24,875)	$	(21,561)

Schedule of investments

A roll forward of the investments is below (in thousands)




	Investments without a readily determinable fair value		Fair value investments		Equity method investments		Total
Balance, December 31, 2023	$	41,710	$	1,197	$	—	$	42,907
Income recognized		—		19		—		19
Contributions / (distributions)		—		(140)		—		(140)
Foreign currency gain		—		—		—		—
Reclassification of foreign currency losses		—		—		—		—
Transfers		—		—		—		—
Balance, March 31, 2024	$	41,710	$	1,076	$	—	$	42,786

Balance, December 31, 2022	$	22,590	$	1,616	$	13,963	$	38,169
Income recognized		—		77		238		315
Contributions / (distributions)		—		—		630		630
Foreign currency loss		—		—		111		111
Balance, March 31, 2023	$	22,590	$	1,693	$	14,942	$	39,225

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands	Total ATNI Stockholders' Equity	Common Stock	Treasury Stock, at cost	Additional Paid In Capital	Retained Earnings	Other Comprehensive Income/(Loss)	Non-Controlling Interests	Total
Balance, beginning of period at Dec. 31, 2022	$ 580,813	$ 173	$ (73,825)	$ 198,449	$ 449,806	$ 6,210	$ 96,016	$ 676,829
Increase (Decrease) in Stockholders' Equity
Purchase of shares of common stock	(2,840)		(2,840)					(2,840)
Stock-based compensation	1,634			1,634			144	1,778
Dividends declared on common stock	(3,315)				(3,315)			(3,315)
Repurchase of non-controlling interests	(68)			(68)			(527)	(595)
Accrued dividend - redeemable preferred units	(1,045)				(1,045)			(1,045)
Deemed dividend - redeemable common units	(2,531)				(2,531)		2,820	289
Comprehensive income:
Net loss	(5,885)				(5,885)		(1,170)	(7,055)
Other comprehensive income (loss)	480					480		480
Total comprehensive income (loss)	(5,405)				(5,885)	480	(1,170)	(6,575)
Balance, end of period at Mar. 31, 2023	567,243	173	(76,665)	200,015	437,030	6,690	97,283	664,526
Balance, beginning of period at Dec. 31, 2023	541,073	173	(90,447)	205,797	417,282	8,268	96,730	637,803
Increase (Decrease) in Stockholders' Equity
Purchase of shares of common stock	(2,016)		(2,016)					(2,016)
Stock-based compensation	1,754			1,754			155	1,909
Dividends declared on common stock	(3,720)				(3,720)		(40)	(3,760)
Accrued dividend - redeemable preferred units	(1,348)				(1,348)			(1,348)
Deemed dividend - redeemable common units	(868)				(868)		3,512	2,644
Comprehensive income:
Net loss	(6,315)				(6,315)		(1,633)	(7,948)
Other comprehensive income (loss)	1,432					1,432		1,432
Total comprehensive income (loss)	(4,883)				(6,315)	1,432	(1,633)	(6,516)
Balance, end of period at Mar. 31, 2024	$ 529,992	$ 173	$ (92,463)	$ 207,551	$ 405,031	$ 9,700	$ 98,724	$ 628,716

REVENUE RECOGNITION AND RECEIVABLES - Receivables (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Accounts Receivable
Gross accounts receivable	$ 155,300	$ 155,000
Customer receivable - long term	45,165	45,676
Allowance for credit loss	16,900	16,400
FirstNet agreement
Accounts Receivable
Customer receivable	52,700	52,900
Customer receivable - long term	$ 45,200	$ 45,700

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
Purchase of shares of common stock	62,940	71,563
Dividends declared on common stock (in dollars per share)	$ 0.24	$ 0.21

COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions	May 08, 2024	Mar. 31, 2024
Consent Decree with the FCC Enforcement Bureau \| Subsequent event
Commitments and contingencies
Settlement, amount	$ 6.3
Consent Decree with the FCC Enforcement Bureau \| Universal Service Administrative Company \| Subsequent event
Commitments and contingencies
Term of compliance agreement	3 years
Pending litigation, adverse outcome
Commitments and contingencies
Accrued contingent liability		$ 17.0

ORGANIZATION AND BUSINESS OPERATIONS (Tables)

3 Months Ended

Mar. 31, 2024

ORGANIZATION AND BUSINESS OPERATIONS

Schedule of the operating activities of the Company's principal subsidiaries, the segments in which the Company reports its revenue and markets served

The following chart summarizes the operating activities of the Company’s principal subsidiaries, the segments in which it reports its revenue and the markets it served during the three months ended March 31, 2024:


International Telecom			US Telecom
Services	Markets	Tradenames	Services	Markets	Tradenames
Mobility Services	Bermuda, Guyana, US Virgin Islands	One, GTT, Viya	Mobility Services	United States (rural markets)	Choice, Choice NTUA Wireless
Fixed Services	Bermuda, Cayman Islands, Guyana, US Virgin Islands	One, Logic, GTT, Viya	Fixed Services	United States	Alaska Communications, Commnet, Choice, Choice NTUA Wireless, Sacred Wind Communications, Ethos, Deploycom
Carrier Services	Bermuda, Guyana, US Virgin Islands	One, Essextel, GTT, Viya	Carrier Services	United States	Alaska Communications, Commnet, Sacred Wind Communications
Managed Services	Bermuda, Cayman Islands, US Virgin Islands, Guyana	Fireminds, One, Logic, GTT, Viya, Brava	Managed Services	United States	Alaska Communications, Choice

Schedule of restructuring expenses

A summary of the costs, since the first quarter of 2023, is below (in thousands):


		US		International
		Telecom		Telecom		Total
Employee termination benefits	$	1,960	$	4,681	$	6,641
Contract termination costs		5,777		—		5,777
Total	$	7,737	$	4,681	$	12,418

LONG-TERM DEBT (Details)						1 Months Ended	3 Months Ended
LONG-TERM DEBT (Details)	Jul. 13, 2023 USD ($)	Dec. 23, 2022 USD ($)	Jun. 15, 2022 USD ($)	Jul. 22, 2021 USD ($)	Apr. 10, 2019 USD ($)	Oct. 31, 2023 USD ($)	Mar. 31, 2024 USD ($)	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)	Nov. 30, 2023 USD ($) derivative	Nov. 07, 2022 USD ($)	Oct. 12, 2022 USD ($)	May 05, 2022	Mar. 26, 2020 USD ($)	Dec. 31, 2016 USD ($)	Jul. 01, 2016 USD ($)
Long-term debt
Revolving credit facility - borrowings							$ 46,000,000	$ 57,553,000
Outstanding borrowings							541,291,000		$ 516,870,000
Current portion of long-term debt							20,476,000		24,290,000
Long-term debt, excluding current portion							520,815,000		492,580,000
Current portion of customer receivable credit facility							7,569,000		$ 7,110,000
Alaska communications \| Interest rate swap \| Designated as cash flow hedges
Long-term debt
Interest rate (in percent)				1.6735%
Alaska credit facility \| Period of second quarter of 2024
Long-term debt
Net total leverage ratio				3.75
Alaska credit facility \| Interest rate swap
Long-term debt
Number of derivative instruments \| derivative										2
Alaska credit facility \| Alaska communications
Long-term debt
Financing costs							7,300,000
Unamortized financing costs							$ 3,500,000
Consolidated EBITDA				12 months
Net total leverage ratio				4.00
Fixed charge coverage ratio				1.25
Alaska credit facility \| Alaska communications \| Period of fourth quarter of 2023 To third quarter 2024
Long-term debt
Periodic payment, principal				$ 1,400,000
Alaska credit facility \| Alaska communications \| Debt Instrument, From Fourth Quarter of 2024 To Third Quarter of 2026
Long-term debt
Periodic payment, principal				$ 2,900,000
Alaska credit facility \| SOFR
Long-term debt
Basis spread on variable rate (as a percent)		0.10%
Alaska credit facility \| SOFR \| Interest rate swap
Long-term debt
Notional amount										$ 200,000,000.0
Alaska credit facility \| SOFR \| Interest rate swap One
Long-term debt
Interest rate (in percent)										4.8695%
Alaska credit facility \| SOFR \| Interest rate swap Two
Long-term debt
Interest rate (in percent)										4.898%
Alaska credit facility \| SOFR \| Alaska communications
Long-term debt
Basis spread on variable rate (as a percent)				0.10%
Alaska credit facility \| Base rate \| Alaska communications
Long-term debt
Basis spread on variable rate (as a percent)				1.00%
Alaska credit facility \| Minimum \| SOFR \| Alaska communications
Long-term debt
Basis spread on variable rate (as a percent)				3.00%
Alaska credit facility \| Maximum \| SOFR \| Alaska communications
Long-term debt
Basis spread on variable rate (as a percent)				4.00%
GTT Credit Facility
Long-term debt
Term of debt							5 years
Borrowings outstanding							$ 0
Fixed interest rate							7.50%
GTT Term Loan Facility
Long-term debt
Maximum borrowing capacity												$ 2,900,000
GTT Overdraft Facility
Long-term debt
Maximum borrowing capacity												$ 5,700,000
Viya Debt
Long-term debt
Net leverage ratio													7.0			3.5
Financing costs															$ 900,000
Unamortized financing costs							$ 200,000
Term loan assumed																$ 60,000,000.0
Fixed interest rate															4.00%	4.00%
Outstanding debt							60,000,000.0
Revolver loan \| 2019 CoBank Credit Facility
Long-term debt
Maximum borrowing capacity					$ 200,000,000
Repayments of debt	$ 139,500,000
Revolver loan \| 2019 CoBank Credit Facility \| Minimum
Long-term debt
Commitment fee (as a percent)					0.15%
Revolver loan \| 2019 CoBank Credit Facility \| Minimum \| Base rate
Long-term debt
Basis spread on variable rate (as a percent)					0.25%
Revolver loan \| 2019 CoBank Credit Facility \| Minimum \| LIBOR
Long-term debt
Basis spread on variable rate (as a percent)					1.25%
Revolver loan \| 2019 CoBank Credit Facility \| Maximum
Long-term debt
Commitment fee (as a percent)					0.375%
Revolver loan \| 2019 CoBank Credit Facility \| Maximum \| Base rate
Long-term debt
Basis spread on variable rate (as a percent)					1.25%
Revolver loan \| 2019 CoBank Credit Facility \| Maximum \| LIBOR
Long-term debt
Basis spread on variable rate (as a percent)					2.25%
Revolver loan \| Alaska credit facility \| Alaska communications
Long-term debt
Maximum borrowing capacity		$ 75,000,000.0		$ 35,000,000.0
Revolving credit facility - borrowings							40,000,000.0
Borrowings outstanding							227,100,000
Remaining borrowing capacity							35,000,000.0
Letter of credit sub-facility
Long-term debt
Borrowings outstanding							32,400,000
Letter of credit sub-facility \| 2023 CoBank Credit Facility
Long-term debt
Maximum borrowing capacity	25,000,000
Letter of credit sub-facility \| 2019 CoBank Credit Facility
Long-term debt
Maximum borrowing capacity					$ 75,000,000
Swingline sub-facility \| 2023 CoBank Credit Facility
Long-term debt
Maximum borrowing capacity	$ 20,000,000
Base rate before one-week or one-month LIBOR (as a percent)	1.00%
Swingline sub-facility \| 2023 CoBank Credit Facility \| Federal Funds Effective Rate
Long-term debt
Basis spread on variable rate (as a percent)	0.50%
Swingline sub-facility \| 2019 CoBank Credit Facility
Long-term debt
Maximum borrowing capacity					$ 10,000,000
Base rate before one-week or one-month LIBOR (as a percent)					1.00%
Swingline sub-facility \| 2019 CoBank Credit Facility \| Federal Funds Effective Rate
Long-term debt
Basis spread on variable rate (as a percent)					0.50%
Term loans \| Alaska credit facility \| Alaska communications
Long-term debt
Outstanding borrowings		$ 230,000,000.0		210,000,000.0
2023 CoBank Credit Facility
Long-term debt
Financing costs							4,200,000
Unamortized financing costs							3,700,000
2023 CoBank Credit Facility \| 2023 CoBank Credit Facility \| Interest rate swap
Long-term debt
Derivative, Term of debt						2 years
Notional amount						$ 50,000,000.0
2023 CoBank Credit Facility \| 2023 CoBank Credit Facility \| SOFR \| Interest rate swap
Long-term debt
Interest rate (in percent)						4.896%
2023 CoBank Credit Facility \| 2023 CoBank Credit Facility \| Minimum
Long-term debt
Commitment fee (as a percent)	0.25%
2023 CoBank Credit Facility \| 2023 CoBank Credit Facility \| Maximum
Long-term debt
Commitment fee (as a percent)	0.50%
2023 CoBank Revolving Loan \| 2023 CoBank Credit Facility
Long-term debt
Term of debt	5 years
Maximum borrowing capacity	$ 170,000,000
Revolving credit facility - borrowings	$ 13,600,000
Borrowings outstanding							60,800,000
Remaining borrowing capacity							109,200,000
2023 CoBank Revolving Loan \| 2023 CoBank Credit Facility \| Minimum \| SOFR
Long-term debt
Basis spread on variable rate (as a percent)	1.75%
2023 CoBank Revolving Loan \| 2023 CoBank Credit Facility \| Minimum \| Base rate
Long-term debt
Basis spread on variable rate (as a percent)	0.75%
2023 CoBank Revolving Loan \| 2023 CoBank Credit Facility \| Maximum
Long-term debt
Net leverage ratio	3.25
2023 CoBank Revolving Loan \| 2023 CoBank Credit Facility \| Maximum \| SOFR
Long-term debt
Basis spread on variable rate (as a percent)	3.50%
2023 CoBank Revolving Loan \| 2023 CoBank Credit Facility \| Maximum \| Base rate
Long-term debt
Basis spread on variable rate (as a percent)	2.50%
2023 CoBank Term Loan \| 2023 CoBank Credit Facility
Long-term debt
Term of debt	6 years
Face amount of debt	$ 130,000,000
Borrowings outstanding							128,400,000
2023 CoBank Term Loan \| 2023 CoBank Credit Facility \| Minimum \| SOFR
Long-term debt
Basis spread on variable rate (as a percent)	2.00%
2023 CoBank Term Loan \| 2023 CoBank Credit Facility \| Minimum \| Base rate
Long-term debt
Basis spread on variable rate (as a percent)	1.00%
2023 CoBank Term Loan \| 2023 CoBank Credit Facility \| Maximum \| SOFR
Long-term debt
Basis spread on variable rate (as a percent)	3.75%
2023 CoBank Term Loan \| 2023 CoBank Credit Facility \| Maximum \| Base rate
Long-term debt
Basis spread on variable rate (as a percent)	2.75%
Incremental term loans \| Alaska credit facility \| Minimum \| Alaska communications
Long-term debt
Maximum borrowing capacity				$ 70,000,000.0
Secured delayed draw term loan \| Alaska Term Facility \| Alaska communications
Long-term debt
Remaining borrowing capacity							0
Outstanding borrowings							5,300,000
Fixed charge coverage ratio			4.0
Maximum borrowing capacity			$ 7,500,000
Senior secured delayed draw term loan \| Receivable credit facility
Long-term debt
Maximum borrowing capacity														$ 75,000,000.0
Financing costs														$ 800,000
Unamortized financing costs							500,000
Borrowings outstanding							48,400,000
Remaining borrowing capacity							11,300,000
Current portion of customer receivable credit facility							7,600,000
Senior secured delayed draw term loan \| Sacred Wind Term Debt
Long-term debt
Outstanding borrowings							27,400,000				$ 31,600,000
Current portion of long-term debt							3,300,000
Long-term debt, excluding current portion							$ 24,100,000
Senior secured delayed draw term loan \| Sacred Wind Term Debt \| Minimum
Long-term debt
Fixed interest rate							0.88%
Senior secured delayed draw term loan \| Sacred Wind Term Debt \| Maximum
Long-term debt
Fixed interest rate							5.00%

FAIR VALUE MEASUREMENTS AND INVESTMENTS - Narrative (Details) - USD ($) $ in Millions	Mar. 31, 2024	Dec. 31, 2023
Equity investments
Fair value measurements
Equity method investments without a readily determinable fair value transferred to the cost method		$ 16.3
Carrying Value
Fair value measurements
Long-term debt	$ 589.3	562.9
Level 2 \| Total
Fair value measurements
Long-term debt	$ 597.4	$ 571.6

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Mar. 31, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

REVENUE RECOGNITION AND RECEIVABLES

3 Months Ended

Mar. 31, 2024

REVENUE RECOGNITION AND RECEIVABLES

REVENUE RECOGNITION AND RECEIVABLES

3. REVENUE RECOGNITION AND RECEIVABLES

Revenue Accounted for in Accordance with Other Guidance

The Company records revenue in accordance with ASC 606 from contracts with customers and ASC 842 from lease agreements, as well as government grants. Lease revenue recognized under ASC 842 is disclosed in Note 4 and government grant revenue is disclosed in Note 8.

Timing of Revenue Recognition

Revenue accounted for in accordance with ASC 606 consisted of the following for the periods presented below (in thousands):


	Three months ended March 31,2024
	International		US
	Telecom		Telecom		Total
Services transferred over time	$	88,560	$	78,043	$	166,603
Goods and services transferred at a point in time		3,034		3,271		6,305
Total revenue accounted for under ASC 606	$	91,594	$	81,314	$	172,908
Operating lease income		72		2,034		2,106
Government grant revenue (1)		1,393		10,387		11,780
Total revenue	$	93,059	$	93,735	$	186,794


	Three months ended March 31,2023
	International		US
	Telecom		Telecom		Total
Services transferred over time	$	85,680	$	81,072	$	166,752
Goods and services transferred at a point in time		3,259		2,546		5,805
Total revenue accounted for under ASC 606	$	88,939	$	83,618	$	172,557
Operating lease income		72		1,831		1,903
Government grant revenue (1)		1,397		9,917		11,314
Total revenue	$	90,408	$	95,366	$	185,774

(1)

Revenue recognized from CAF II, USF and RDOF programs. Refer to Note 8.

Contract Assets and Liabilities

The Company recognizes contract assets and liabilities on its balance sheet. Contract assets represent unbilled amounts typically resulting from consumer Mobility contracts with both a multiyear service period and a promotional discount. In these contracts, the revenue recognized exceeds the amount billed to the customer. The current portion of the contract asset is recorded in prepayments and other current assets and the noncurrent portion is included in other assets on the Company’s balance sheets.

Contract liabilities consist of advance payments and billings in excess of revenue recognized. Mobility and Fixed revenue for postpaid customers is generally billed one month in advance and recognized over the period that the corresponding service is rendered to customers. To the extent the service is not provided by the reporting date the amount is recognized as a contract liability. Prepaid service, including Mobility services, sold to customers is recorded as deferred revenue prior to the commencement of services. Contract liabilities also include certain long term fixed business and carrier service customer contracts. The current portion of contract liabilities are recorded in advanced payments and deposits and the noncurrent portion is included in deferred revenue, long-term on the Company’s balance sheets.

In July 2019, the Company entered into a Network Build and Maintenance Agreement with AT&T Mobility, LLC (“AT&T”) that was subsequently amended through March 31, 2024 (the “FirstNet Agreement”). In connection with the FirstNet Agreement, the Company is building a portion of AT&T’s network for the First Responder Network Authority in or near the Company’s current operating areas in the western United States (the “FirstNet Transaction”). The FirstNet Transaction includes construction and service performance obligations. The current portion of receivables under this agreement is recorded in customer receivable and the long-term portion is recorded in customer receivable long-term on the Company’s balance sheet.

In May 2023, the Company amended its current roaming agreement and entered into a carrier management services agreement with Verizon Wireless (the “Verizon CMS Agreement”). The transaction includes service performance obligations under which revenue is recognized over time. The Company allocates the transaction price of these agreements to each performance obligation based on the relative standalone selling price of each performance obligation in the contract. The standalone selling price is the estimated price the Company would charge for the good or service in a separate transaction with similar customers in similar circumstances.

Contract assets and liabilities consisted of the following (amounts in thousands):


	March 31, 2024		December 31, 2023			$ Change	% Change
Contract asset – current	$	3,469	$	3,616	$	(147)		(4.1)	%
Contract asset – noncurrent		5,490		5,509		(19)		(0.3)	%
Contract liability – current		(31,721)		(30,990)		(731)		2.4	%
Contract liability – noncurrent		(61,611)		(64,035)		2,424		(3.8)	%
Net contract liability	$	(84,373)	$	(85,900)	$	1,527		(1.8)	%

The decrease in the Company’s net contract liability was due to the timing of customer prepayments, contract billings, and recognition of deferred revenue. During the three months ended March 31, 2024, the Company recognized revenue of $16.8 million related to its December 31, 2023 contract liability and amortized $1.3 million of the December 31, 2023 contract asset to revenue.

Contract Acquisition Costs

The March 31, 2024 and 2023 balance sheets include contract acquisition costs of $11.4 million and $9.0 million, respectively, in other assets. During the three months ended March 31, 2024 and 2023, the Company amortized $1.6 million and $1.1 million, respectively, of contract acquisition costs.

Remaining Performance Obligations

Remaining performance obligations represent the transaction price allocated to unsatisfied performance obligations of certain multiyear Mobility contracts, which include a promotional discount, Managed Services contracts, and the Company’s Carrier Services construction and service contracts. The transaction price allocated to unsatisfied performance obligations was $463 million and $494 million at March 31, 2024 and December 31, 2023, respectively. The decrease during 2024 was due to the Company satisfying certain performance obligations. The Company expects to satisfy approximately 34% of the remaining performance obligations and recognize the transaction price within 24 months and approximately $50 million annually from 2026 through 2031.

The Company has certain Mobility, Fixed, and Carrier Services contracts where the transaction price is allocated to remaining performance obligations. However, the Company omits these contracts from its disclosure by applying the right to invoice, one year or less, and wholly unsatisfied performance obligation practical expedients.

Disaggregation

The Company's revenue is presented on a disaggregated basis in Note 12 based on an evaluation of disclosures outside the financial statements, information regularly reviewed by the chief operating decision makers for evaluating the financial performance of operating segments and other information that is used for performance evaluation and resource allocations. This includes revenue from Communication Services, Construction, and Other revenue. Communication Services revenue is further disaggregated into business and consumer Mobility, business and consumer Fixed, Carrier Services, and Other services. Other revenue is further disaggregated into Managed Services revenue.

Receivables

The Company records an estimate of future credit losses in conjunction with the revenue transaction based on the information available including historical experience and management’s expectations of future conditions. Those estimates will be updated as additional information becomes available. The Company’s allowance for uncollectible accounts receivable is based on management’s assessment of the collectability of assets pooled together with similar risk characteristics.

The Company had gross accounts receivable of $155.3 million and an allowance for credit losses of $16.9 million as of March 31, 2024. In addition, the Company had receivables under the FirstNet Agreement totaling $52.7 million, of which $45.2 million was long-term. At December 31, 2023, the Company had gross accounts receivable of $155.0 million and an allowance for credit losses of $16.4 million and a receivable under the FirstNet Agreement totaling $52.9 million, of which $45.7 million was long-term. The Company monitors receivables through the use of historical operating data adjusted for the expectation of future performance as appropriate. Activity in the allowance for credit losses is below (in thousands):


	Three months ended
	March 31, 2024		March 31, 2023

Balance at beginning of period	$	16,362	$	15,171
Current period provision for expected losses		1,322		1,378
Write-offs charged against the allowance		(903)		(591)
Recoveries collected		83		74
Balance at end of period	$	16,864	$	16,032

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

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LEASES - Narrative (Details)	Mar. 31, 2024
Minimum
LEASES
Operating lease, lease term	3 years
Finance lease, lease term	3 years
Maximum
LEASES
Operating lease, lease term	10 years
Finance lease, lease term	10 years

INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
INCOME TAXES
Effective tax rate (as a percent)	(25.60%)	9.50%
Income tax expense	$ 1,619	$ (740)
Pre-tax loss	6,329	7,795
Expense for an uncertain tax position for the current year	1,500
Expense for interest on uncertain tax positions	$ 700	$ 600

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

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Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS - Redeemable Noncontrolling Interests Activity (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Increase (decrease) in temporary equity
Beginning balance	$ 85,917	$ 92,469
Accrued preferred dividend	1,348	1,045
Allocated net loss	(3,512)	(2,821)
Change in fair value	868	2,530
Ending balance	84,621	93,223
Redeemable common units
Increase (decrease) in temporary equity
Beginning balance	25,823	37,317
Allocated net loss	(3,512)	(2,821)
Change in fair value	868	2,530
Ending balance	23,179	37,026
Redeemable preferred units
Increase (decrease) in temporary equity
Beginning balance	60,094	55,152
Accrued preferred dividend	1,348	1,045
Ending balance	$ 61,442	$ 56,197

Carrying amount, attributable to parent and noncontrolling interests, of an entity's issued and outstanding stock which is not included within permanent equity. Temporary equity is a security with redemption features that are outside the control of the issuer, is not classified as an asset or liability in conformity with GAAP, and is not mandatorily redeemable. Includes any type of security that is redeemable at a fixed or determinable price or on a fixed or determinable date or dates, is redeemable at the option of the holder, or has conditions for redemption which are not solely within the control of the issuer. Includes stock with a put option held by an ESOP and stock redeemable by a holder only in the event of a change in control of the issuer.

Schedule of components of the plan's net periodic pension cost

EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS - Redeemable Noncontrolling Interests Narrative (Details) - Redeemable Common Units [Member] - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Reconciliation from basic to diluted weighted average common shares outstanding
Allocated losses	$ 3.5	$ 2.8
Increase in book value	$ 0.9	$ 2.5

LEASES - Weighted average remaining lease terms and discount rates (Details)	Mar. 31, 2024	Dec. 31, 2023
LEASES
Operating leases, weighted average remaining lease term	12 years 10 months 24 days	13 years 3 months 18 days
Financing leases, weighted average remaining lease term	9 years 2 months 12 days	9 years 2 months 12 days
Operating leases, weighted average discount rate	6.60%	6.30%
Financing leases, weighted average discount rate	7.20%	6.60%

RETIREMENT PLANS (Tables)

3 Months Ended

Mar. 31, 2024

RETIREMENT PLANS

The Company recorded the net periodic benefit cost identified below (in thousands):


	Three months ended
	March 31, 2024				March 31, 2023
	Pension benefits		Postretirement benefits		Pension benefits		Postretirement benefits
Operating expense
Service cost	$	22	$	16	$	38	$	31
Non-operating expense
Interest cost		824		45		593		35
Expected return on plan assets		(729)		—		(953)		—
Amortization of unrecognized actuarial gain		(11)		(28)		—		—
Settlements		—		—		369		—
Net periodic pension expense (benefit)	$	106	$	33	$	47	$	66

LEASES

3 Months Ended

Mar. 31, 2024

LEASES

LEASES

4. LEASES

Lessee Disclosure

The Company has operating and financing leases for towers, land, corporate offices, retail facilities, and data transport capacity. The lease terms are generally between three and 10 years, some of which include additional renewal options.

Supplemental lease information

The components of lease expense were as follows (in thousands):


	Three months ended
	March 31, 2024		March 31, 2023
Operating lease cost:
Operating lease cost	$	5,479	$	5,981
Short-term lease cost		691		677
Variable lease cost		1,429		662
Total operating lease cost	$	7,599	$	7,320

Finance lease cost:
Amortization of right-of-use asset	$	612	$	699
Variable costs		198		203
Interest costs		100		84
Total finance lease cost	$	910	$	986

During the three months ended March 31, 2024 and 2023, the Company paid $4.8 million and $5.0 million, respectively, for operating lease liabilities. During the three months ended March 31, 2024 and 2023, the Company recorded $2.3 million and $2.9 million, respectively, of operating lease liabilities arising from right of use assets. During the three months ended March 31, 2023, in conjunction with the restructuring activities the Company terminated certain leases and removed $5.0 million of lease right of use assets and $5.3 million of lease liabilities from its balance sheet, resulting in the recording of a gain of $0.3 million in the restructuring expense line of its statement of operations.

At March 31, 2024, finance leases with a cost of $31.7 million and accumulated amortization of $17.0 million were included in property, plant and equipment. During the three months ended March 31, 2024, the Company paid $0.4 million of financing cash flows and $0.1 million of operating cash flows for finance lease liabilities. During the three months ended March 31, 2023, the Company paid $0.2 million of financing cash flows, $0.9 million of investing cash flows and $0.1 million of operating cash flows for finance lease liabilities. At March 31, 2024, finance leases had a lease liability of $5.2 million, of which $1.8 million was current.

At December 31, 2023, finance leases with a cost of $31.7 million and accumulated amortization of $16.4 million were included in property, plant and equipment.

The weighted average remaining lease terms and discount rates as of March 31, 2024 and December 31, 2023 are noted in the table below:


	March 31, 2024		December 31, 2023
Weighted-average remaining lease term
Operating leases		12.9 years		13.3 years
Financing leases		9.2 years		9.2 years

Weighted-average discount rate
Operating leases		6.6%		6.3%
Financing leases		7.2%		6.6%

Maturities of lease liabilities as of March 31, 2024 were as follows (in thousands):


	Operating Leases		Financing Leases
2024 (excluding the three months ended March 31, 2024)	$	13,608	$	1,614
2025		16,800		1,394
2026		12,405		570
2027		9,542		534
2028		7,553		505
Thereafter		82,078		2,145
Total lease payments		141,986		6,762
Less imputed interest		(56,664)		(1,555)
Total	$	85,322	$	5,207

Maturities of lease liabilities as of December 31, 2023 were as follows (in thousands):


	Operating Leases		Financing Leases
2024	$	18,048	$	2,030
2025		16,022		1,488
2026		11,755		601
2027		9,327		534
2028		7,807		505
Thereafter		80,637		2,145
Total lease payments		143,596		7,303
Less imputed interest		(57,133)		(1,662)
Total	$	86,463	$	5,641

As of March 31, 2024, the Company did not have any material operating or finance leases that have not yet commenced.

Lessor Disclosure

The Company is the lessor in agreements to lease the use of its network assets including its wireless cell sites and buildings. For the three months ended March 31, 2024 and 2023, the Company recorded $2.1 million and $1.9 million, respectively, of lease income from agreements in which the Company is the lessor. Lease income is classified as Carrier Services revenue in the statement of operations.

The following table presents the maturities of future undiscounted lease payments for the periods indicated (in thousands):


2024 (excluding the three months ended March 31, 2024)	$	5,995
2025		7,060
2026		6,749
2027		5,559
2028		5,180
Thereafter		13,353
Total future lease payments	$	43,896

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Net loss	$ (7,948)	$ (7,055)
Other comprehensive income:
Foreign currency translation adjustment net of tax expense of $0 and $0 million		111
Reclassification of loss on pension settlement, net of $0 and $0 million of tax		369
Unrealized gain on derivatives net of tax expense of $0.5 million and $0	1,432
Other comprehensive income (loss), net of tax	1,432	480
Comprehensive loss	(6,516)	(6,575)
Less: Comprehensive (income) loss attributable to noncontrolling interests	1,633	1,170
Comprehensive loss attributable to ATN International, Inc.	$ (4,883)	$ (5,405)

EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS - Computation (Details) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Numerator:
Net loss attributable to ATN International, Inc. stockholders- Basic	$ (6,315)	$ (5,885)
Less: Preferred dividends	(1,348)	(1,045)
Net Loss attributable to ATN International, Inc. common stockholders- Diluted	$ (7,663)	$ (6,930)
Denominator:
Weighted-average shares outstanding- Basic	15,437	15,768
Weighted-average shares outstanding- Diluted	15,437	15,768

Amount, after deduction of tax, noncontrolling interests, dividends on preferred stock and participating securities; of income (loss) available to common shareholders.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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Amount, after deduction of tax, noncontrolling interests, dividends on preferred stock and participating securities, and addition from assumption of issuance of common shares for dilutive potential common shares; of income (loss) available to common shareholders.

USE OF ESTIMATES

3 Months Ended

Mar. 31, 2024

USE OF ESTIMATES

USE OF ESTIMATES

5. USE OF ESTIMATES

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. The most significant estimates relate to the allowance for credit losses on trade receivables, useful lives of the Company’s fixed and finite-lived intangible assets, allocation of purchase price to assets acquired and liabilities assumed in business combinations, fair value of indefinite-lived intangible assets, goodwill and income taxes. Actual results could differ significantly from those estimates.

SUBSEQUENT EVENTS (Details) - Subsequent event - Consent Decree with the FCC Enforcement Bureau $ in Millions	May 08, 2024 USD ($)
SUBSEQUENT EVENT
Settlement, amount	$ 6.3
Cash payment	5.3
Amount of forgiveness on receivables for settlement	$ 1.0
Universal Service Administrative Company
SUBSEQUENT EVENT
Term of compliance agreement	3 years

ORGANIZATION AND BUSINESS OPERATIONS (Details)	3 Months Ended
ORGANIZATION AND BUSINESS OPERATIONS (Details)	Mar. 31, 2024 segment
ORGANIZATION AND BUSINESS OPERATIONS
Number of operating segments	2

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash flows from operating activities:
Net loss	$ (7,948)	$ (7,055)
Adjustments to reconcile net loss to net cash flows provided by operating activities:
Depreciation and amortization	34,340	36,404
Amortization of intangibles from acquisitions	1,980	3,247
Provision for doubtful accounts	1,322	1,378
Amortization of debt discount and debt issuance costs	625	569
Gain on disposition of assets and contingent consideration	(493)	(167)
Stock-based compensation	1,909	1,778
Deferred income taxes	(2,181)	(1,953)
Loss on pension settlement		369
Gain on investments	(170)	(315)
Changes in operating assets and liabilities, excluding the effects of acquisitions and dispositions:
Accounts receivable	2,183	3,573
Customer receivable	254	745
Prepaid income taxes		679
Accrued taxes	3,966	6,953
Materials and supplies, prepayments, and other current assets	(626)	(3,503)
Accounts payable and accrued liabilities, advance payments and deposits and other current liabilities	(9,624)	(24,548)
Other assets	340	141
Other liabilities	(2,701)	(2,283)
Net cash provided by operating activities	23,176	16,012
Cash flows from investing activities:
Capital expenditures	(36,016)	(50,598)
Government capital programs - Amounts disbursed	(13,473)	(2,127)
Government capital programs - Amounts received	10,546	593
Purchases of strategic investments		(630)
Purchase of intangible assets	(573)
Purchase of investments - employee benefit plan	(25)
Proceeds from investments - employee benefit plan	201
Proceeds from sale of assets	3,655
Net cash used in investing activities	(35,685)	(52,762)
Cash flows from financing activities:
Dividends paid on common stock	(3,701)	(3,310)
Payment of debt issuance costs	(72)	(119)
Finance lease payments	(443)	(249)
Term loan - repayments	(3,801)	(1,171)
Revolving credit facility - borrowings	46,000	57,553
Revolving credit facility - repayments	(18,302)	(14,000)
Proceeds from customer receivable credit facility	3,700	4,300
Repayment of customer receivable credit facility	(1,804)	(1,570)
Purchases of common stock - stock- based compensation	(1,896)	(1,433)
Purchases of common stock - share repurchase plan	(121)	(1,407)
Repurchases of noncontrolling interests		(595)
Net cash provided by financing activities	19,560	37,999
Net change in cash, cash equivalents, and restricted cash	7,051	1,249
Total cash, cash equivalents, and restricted cash, beginning of period	62,167	59,728
Total cash, cash equivalents, and restricted cash, end of period	69,218	60,977
Supplemental cash flow information:
Interest paid	10,291	6,711
Taxes paid	748	29
Dividends declared, not paid	3,720	3,315
Noncash investing activity:
Amounts accrued for reimbursable capital expenditures from government capital programs	33,446	1,435
Amounts accrued for non-reimbursable capital expenditures	$ 14,032	$ 14,773

REVENUE RECOGNITION AND RECEIVABLES - Remaining Performance Obligations (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Revenue Recognition
Transaction price allocated to unsatisfied performance obligations		$ 494
Revenue, Practical Expedient, Financing Component [true false]	false
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01
Revenue Recognition
Transaction price allocated to unsatisfied performance obligations	$ 463
Percentage of performance obligations to be satisfied	34.00%
Period to satisfy the remaining performance obligations and recognize the transaction price	24 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01
Revenue Recognition
Transaction price allocated to unsatisfied performance obligations	$ 50
Period to satisfy the remaining performance obligations and recognize the transaction price	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01
Revenue Recognition
Transaction price allocated to unsatisfied performance obligations	$ 50
Period to satisfy the remaining performance obligations and recognize the transaction price	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2028-01-01
Revenue Recognition
Transaction price allocated to unsatisfied performance obligations	$ 50
Period to satisfy the remaining performance obligations and recognize the transaction price	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2029-01-01
Revenue Recognition
Transaction price allocated to unsatisfied performance obligations	$ 50
Period to satisfy the remaining performance obligations and recognize the transaction price	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2030-01-01
Revenue Recognition
Transaction price allocated to unsatisfied performance obligations	$ 50
Period to satisfy the remaining performance obligations and recognize the transaction price	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2031-01-01
Revenue Recognition
Transaction price allocated to unsatisfied performance obligations	$ 50
Period to satisfy the remaining performance obligations and recognize the transaction price	12 months

LEASES - Maturities of lease liabilities (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Lessor, Lease, Description [Line Items]
2024 (excluding the three months ended March 31, 2024)	$ 13,608
Year 1	16,800		$ 18,048
Year 2	12,405		16,022
Year 3	9,542		11,755
Year 4	7,553		9,327
Year 5			7,807
Thereafter	82,078
Thereafter			80,637
Total lease payments	141,986		143,596
Less imputed interest	(56,664)		(57,133)
Total	$ 85,322		$ 86,463
Operating Lease, Liability, Statement of Financial Position [Extensible List]	Lease Liability, Current, Lease Liability, Noncurrent		Lease Liability, Current, Lease Liability, Noncurrent
Finance lease liability
2024 (excluding the three months ended March 31, 2024)	$ 1,614
Year 1	1,394		$ 2,030
Year 2	570		1,488
Year 3	534		601
Year 4	505		534
Year 5			505
Thereafter			2,145
Thereafter	2,145
Total lease payments	6,762		7,303
Less imputed interest	(1,555)		(1,662)
Total	$ 5,207		$ 5,641
Finance Lease, Liability, Statement of Financial Position [Extensible List]	Lease Liability, Current, Lease Liability, Noncurrent		Lease Liability, Current, Lease Liability, Noncurrent
Lease income	$ 2,106	$ 1,903
Maturities of future undiscounted lease payments
2024 (excluding the three months ended March 31, 2024)	5,995
2025	7,060
2026	6,749
2027	5,559
2028	5,180
Thereafter	13,353
Total future lease payments	43,896
Network asset
Finance lease liability
Lease income	$ 2,100	$ 1,900

BASIS OF PRESENTATION (Policies)	3 Months Ended
BASIS OF PRESENTATION (Policies)	Mar. 31, 2024
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION	The accompanying condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The financial information included herein is unaudited; however, the Company believes such information and the disclosures herein are adequate to make the information presented not misleading and reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair statement of the Company’s financial position and results of operations for the periods described therein. The year-end condensed balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. Results of interim periods may not be indicative of results for the full year. These condensed consolidated financial statements and related notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 15, 2024. The condensed consolidated financial statements include the accounts of the Company, its subsidiaries in which the Company holds controlling interests and certain entities which are consolidated in accordance with the provisions of the Financial Accounting Standards Board’s (“FASB”) authoritative guidance on the consolidation of variable interest entities, since it is determined that the Company is the primary beneficiary of these entities.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In December 2023, the FASB released ASU 2023-09, titled "Enhancements to Income Tax Disclosures," with the aim of improving the clarity and usefulness of income tax disclosures. The update focuses primarily on enhancing disclosures related to rate reconciliation and income taxes paid. ASU 2023-09 becomes effective for annual reporting periods starting after December 15, 2024, with early adoption permitted. While the changes prescribed by ASU 2023-09 are implemented prospectively, retrospective application is also allowed. The Company has chosen not to early adopt this standard and is currently assessing its potential impact on our consolidated financial statements and accompanying disclosures. In November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (ASU 2023-07), which requires that a public entity disclose, on an interim and annual basis, significant segment expense categories and amounts that are regularly provided to its chief operating decision maker (CODM) and included in each reported measure of segment profit or loss. An entity must also disclose, by reportable segment, the amount and composition of other expenses. The standard requires an entity to disclose the title and position of its CODM and explain how the CODM uses these reported measures in assessing segment performance and determining how to allocate resources. ASU 2023-07 will be effective for annual periods beginning after December 15, 2023, and interim periods beginning after December 31, 2024, with retrospective application. The standard allows early adoption of these requirements and we are currently evaluating the disclosure impacts of our adoption.

SEGMENT REPORTING

3 Months Ended

Mar. 31, 2024

SEGMENT REPORTING

SEGMENT REPORTING

12. SEGMENT REPORTING

The Company has the following two reportable and operating segments: i) International Telecom and ii) US Telecom.

The following tables provide information for each operating segment (in thousands):


For the Three Months Ended March 31, 2024

	International		US		Corporate and
	Telecom		Telecom		Other (1)		Consolidated
Revenue
Communication Services
Mobility - Business	$	4,808	$	74	$	—	$	4,882
Mobility - Consumer		21,229		764		—		21,993
Total Mobility		26,037		838		—		26,875
Fixed - Business		18,532		34,965		—		53,497
Fixed - Consumer		42,789		22,919		—		65,708
Total Fixed		61,321		57,884		—		119,205
Carrier Services		3,574		30,052		—		33,626
Other		818		744		—		1,562
Total Communication Services Revenue		91,750		89,518		—		181,268
Construction		—		1,586		—		1,586
Other
Managed Services		1,309		2,631		—		3,940
Total other revenue		1,309		2,631		—		3,940
Total Revenue		93,059		93,735		—		186,794
Depreciation and amortization		16,124		18,138		78		34,340
Amortization of intangibles from acquisitions		251		1,729		—		1,980
Non-cash stock-based compensation		23		132		1,754		1,909
Operating income (loss)		11,685		597		(7,708)		4,574


For the Three Months Ended March 31, 2023

	International		US		Corporate and
	Telecom		Telecom		Other (1)		Consolidated
Revenue
Communication Services
Mobility - Business	$	3,575	$	172	$	—	$	3,747
Mobility - Consumer		22,532		987		—		23,519
Total Mobility		26,107		1,159		—		27,266
Fixed - Business		17,113		36,320		—		53,433
Fixed - Consumer		41,778		22,582		—		64,360
Total Fixed		58,891		58,902		—		117,793
Carrier Services		3,690		32,084		—		35,774
Other		400		75		—		475
Total Communication Services Revenue		89,088		92,220		—		181,308
Construction		—		590		—		590
Other
Managed Services		1,320		2,556		—		3,876
Total Other Revenue		1,320		2,556		—		3,876
Total Revenue		90,408		95,366		—		185,774
Depreciation		14,186		21,487		731		36,404
Amortization of intangibles from acquisitions		380		2,867		—		3,247
Non-cash stock-based compensation		67		77		1,634		1,778
Operating income (loss)		13,825		(4,342)		(8,847)		636

Selected balance sheet data for each of the Company’s segments as of March 31, 2024 and December 31, 2023 consists of the following (in thousands):


	International		US		Corporate and
	Telecom		Telecom		Other		Consolidated
March 31, 2024
Cash, cash equivalents, and restricted cash	$	35,369	$	32,288	$	1,561	$	69,218
Total current assets		121,262		157,318		11,147		289,727
Fixed assets, net		479,325		585,979		6,178		1,071,482
Goodwill		4,835		35,269		—		40,104
Total assets		679,591		1,006,960		92,603		1,779,154
Total current liabilities		87,986		155,274		30,357		273,617
Total debt, including current portion		59,776		295,996		185,519		541,291
December 31, 2023
Cash, cash equivalents, and restricted cash	$	26,354	$	33,574	$	2,239	$	62,167
Total current assets		107,469		162,768		11,035		281,272
Fixed assets, net		481,911		593,833		4,915		1,080,659
Goodwill		4,836		35,268		—		40,104
Total assets		672,171		1,019,924		91,619		1,783,714
Total current liabilities		86,540		169,297		37,357		293,194
Total debt, including current portion		64,254		293,607		159,009		516,870

For the three months ended March 31, 2024 and 2023, the Company spent $49.5 million and $52.7 million, respectively, on capital expenditures relating to its telecommunications networks and business support systems of which $13.5 million and $2.1 million, respectively, are reimbursable under various government programs. The following notes the Company’s capital expenditures, by operating segment, for these periods (in thousands).


	Capital Expenditures

		International		US		Corporate and
Three months ended March 31,		Telecom		Telecom		Other (1)		Consolidated
2024	$	16,915	$	31,233	$	1,341	$	49,489
2023		21,464		31,261		—		52,725

(1)

Corporate and other items refer to corporate overhead costs and consolidating adjustments

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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Schedule of information for each operating segment

SEGMENT REPORTING (Tables)

3 Months Ended

Mar. 31, 2024

SEGMENT REPORTING

The following tables provide information for each operating segment (in thousands):


For the Three Months Ended March 31, 2024

	International		US		Corporate and
	Telecom		Telecom		Other (1)		Consolidated
Revenue
Communication Services
Mobility - Business	$	4,808	$	74	$	—	$	4,882
Mobility - Consumer		21,229		764		—		21,993
Total Mobility		26,037		838		—		26,875
Fixed - Business		18,532		34,965		—		53,497
Fixed - Consumer		42,789		22,919		—		65,708
Total Fixed		61,321		57,884		—		119,205
Carrier Services		3,574		30,052		—		33,626
Other		818		744		—		1,562
Total Communication Services Revenue		91,750		89,518		—		181,268
Construction		—		1,586		—		1,586
Other
Managed Services		1,309		2,631		—		3,940
Total other revenue		1,309		2,631		—		3,940
Total Revenue		93,059		93,735		—		186,794
Depreciation and amortization		16,124		18,138		78		34,340
Amortization of intangibles from acquisitions		251		1,729		—		1,980
Non-cash stock-based compensation		23		132		1,754		1,909
Operating income (loss)		11,685		597		(7,708)		4,574


For the Three Months Ended March 31, 2023

	International		US		Corporate and
	Telecom		Telecom		Other (1)		Consolidated
Revenue
Communication Services
Mobility - Business	$	3,575	$	172	$	—	$	3,747
Mobility - Consumer		22,532		987		—		23,519
Total Mobility		26,107		1,159		—		27,266
Fixed - Business		17,113		36,320		—		53,433
Fixed - Consumer		41,778		22,582		—		64,360
Total Fixed		58,891		58,902		—		117,793
Carrier Services		3,690		32,084		—		35,774
Other		400		75		—		475
Total Communication Services Revenue		89,088		92,220		—		181,308
Construction		—		590		—		590
Other
Managed Services		1,320		2,556		—		3,876
Total Other Revenue		1,320		2,556		—		3,876
Total Revenue		90,408		95,366		—		185,774
Depreciation		14,186		21,487		731		36,404
Amortization of intangibles from acquisitions		380		2,867		—		3,247
Non-cash stock-based compensation		67		77		1,634		1,778
Operating income (loss)		13,825		(4,342)		(8,847)		636

Schedule of selected balance sheet data for each segment

Selected balance sheet data for each of the Company’s segments as of March 31, 2024 and December 31, 2023 consists of the following (in thousands):


	International		US		Corporate and
	Telecom		Telecom		Other		Consolidated
March 31, 2024
Cash, cash equivalents, and restricted cash	$	35,369	$	32,288	$	1,561	$	69,218
Total current assets		121,262		157,318		11,147		289,727
Fixed assets, net		479,325		585,979		6,178		1,071,482
Goodwill		4,835		35,269		—		40,104
Total assets		679,591		1,006,960		92,603		1,779,154
Total current liabilities		87,986		155,274		30,357		273,617
Total debt, including current portion		59,776		295,996		185,519		541,291
December 31, 2023
Cash, cash equivalents, and restricted cash	$	26,354	$	33,574	$	2,239	$	62,167
Total current assets		107,469		162,768		11,035		281,272
Fixed assets, net		481,911		593,833		4,915		1,080,659
Goodwill		4,836		35,268		—		40,104
Total assets		672,171		1,019,924		91,619		1,783,714
Total current liabilities		86,540		169,297		37,357		293,194
Total debt, including current portion		64,254		293,607		159,009		516,870

Schedule of segment capital expenditures

The following notes the Company’s capital expenditures, by operating segment, for these periods (in thousands).


	Capital Expenditures

		International		US		Corporate and
Three months ended March 31,		Telecom		Telecom		Other (1)		Consolidated
2024	$	16,915	$	31,233	$	1,341	$	49,489
2023		21,464		31,261		—		52,725

(1)

Corporate and other items refer to corporate overhead costs and consolidating adjustments

BASIS OF PRESENTATION

3 Months Ended

Mar. 31, 2024

BASIS OF PRESENTATION

BASIS OF PRESENTATION

2. BASIS OF PRESENTATION

The accompanying condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The financial information included herein is unaudited; however, the Company believes such information and the disclosures herein are adequate to make the information presented not misleading and reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair statement of the Company’s financial position and results of operations for the periods described therein. The year-end condensed balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. Results of interim periods may not be indicative of results for the full year. These condensed consolidated financial statements and related notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 15, 2024.

The condensed consolidated financial statements include the accounts of the Company, its subsidiaries in which the Company holds controlling interests and certain entities which are consolidated in accordance with the provisions of the Financial Accounting Standards Board’s (“FASB”) authoritative guidance on the consolidation of variable interest entities, since it is determined that the Company is the primary beneficiary of these entities.

Recent Accounting Pronouncements

In December 2023, the FASB released ASU 2023-09, titled "Enhancements to Income Tax Disclosures," with the aim of improving the clarity and usefulness of income tax disclosures. The update focuses primarily on enhancing disclosures related to rate reconciliation and income taxes paid. ASU 2023-09 becomes effective for annual reporting periods starting after December 15, 2024, with early adoption permitted. While the changes prescribed by ASU 2023-09 are implemented prospectively, retrospective application is also allowed. The Company has chosen not to early adopt this standard and is currently assessing its potential impact on our consolidated financial statements and accompanying disclosures.

In November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (ASU 2023-07), which requires that a public entity disclose, on an interim and annual basis, significant segment expense categories and amounts that are regularly provided to its chief operating decision maker (CODM) and included in each reported measure of segment profit or loss. An entity must also disclose, by reportable segment, the amount and composition of other expenses. The standard requires an entity to disclose the title and position of its CODM and explain how the CODM uses these reported measures in assessing segment performance and determining how to allocate resources. ASU 2023-07 will be effective for annual periods beginning after December 15, 2023, and interim periods beginning after December 31, 2024, with retrospective application. The standard allows early adoption of these requirements and we are currently evaluating the disclosure impacts of our adoption.

LEASES - Components of Lease Expense and Payments (Details) - USD ($) $ in Thousands	3 Months Ended		15 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Mar. 31, 2024	Dec. 31, 2023
LEASES
Operating lease cost	$ 5,479	$ 5,981
Short-term lease cost	691	677
Variable lease cost	1,429	662
Total operating lease cost	7,599	7,320
Finance lease cost:
Amortization of right-of-use asset	612	699
Variable costs	198	203
Interest costs	100	84
Total finance lease cost	910	986
Payments for lease liabilities	4,800	5,000
Lease liabilities arising from right of use assets	2,300	2,900
Right of use assets terminated	5,600	5,000	$ 5,600
Lease liabilities terminated	5,900	5,300	5,900
Gain on lease termination		300	300
Finance leases cost included in property, plant and equipment	31,700		31,700	$ 31,700
Accumulated amortization related to finance leases	17,000		17,000	16,400
Principal payments, finance lease liabilities	443	249
Investing cash flows for finance lease liabilities		900
Operating cash flows for finance lease liabilities	100	$ 100
Finance lease liability	5,207		5,207	$ 5,641
Finance lease liability, current	$ 1,800		$ 1,800

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
REVENUE:
Total revenue	$ 186,794	$ 185,774
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated):
Selling, general and administrative	61,315	61,348
Stock-based compensation	1,909	1,778
Transaction-related charges	19	13
Restructuring expenses	1,190	2,887
Depreciation and amortization	34,340	36,404
Amortization of intangibles from acquisitions	1,980	3,247
Gain on disposition of assets	(493)	(167)
Total operating expenses	182,220	185,138
Income from operations	4,574	636
OTHER INCOME (EXPENSE)
Interest income	445	182
Interest expense	(11,520)	(8,807)
Other income	172	194
Other (expense)	(10,903)	(8,431)
LOSS BEFORE INCOME TAXES	(6,329)	(7,795)
Income tax expense (benefit)	1,619	(740)
NET LOSS	(7,948)	(7,055)
Net loss attributable to noncontrolling interests, net of tax (benefit) expense of $0.3 million and $(0.6) million respectively	1,633	1,170
NET LOSS ATTRIBUTABLE TO ATN INTERNATIONAL, INC. STOCKHOLDERS	$ (6,315)	$ (5,885)
Basic (in dollars per share)	$ (0.50)	$ (0.44)
Diluted (in dollars per share)	$ (0.50)	$ (0.44)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic (in shares)	15,437	15,768
Diluted (in shares)	15,437	15,768
DIVIDENDS PER SHARE APPLICABLE TO COMMON STOCK	$ 0.24	$ 0.21
Communication services
REVENUE:
Total revenue	$ 181,268	$ 181,308
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated):
Cost of services	80,390	79,040
Construction
REVENUE:
Total revenue	1,586	590
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated):
Cost of services	1,570	588
Other
REVENUE:
Total revenue	$ 3,940	$ 3,876

SEGMENT REPORTING (Details) $ in Thousands	3 Months Ended
SEGMENT REPORTING (Details) $ in Thousands	Mar. 31, 2024 USD ($) segment	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)
Segment reporting
Number of reportable segments \| segment	2
Number of operating segments \| segment	2
Revenue
Revenue	$ 186,794	$ 185,774
Depreciation	34,340	36,404
Amortization of intangibles from acquisitions	1,980	3,247
Non-cash stock-based compensation	1,909	1,778
Operating income (loss)	4,574	636
Segment Assets
Cash, cash equivalents, and restricted cash	69,218	60,977	$ 62,167	$ 59,728
Total current assets	289,727		281,272
Fixed Assets, net	1,071,482		1,080,659
Goodwill	40,104		40,104
Total assets	1,779,154		1,783,714
Total current liabilities	273,617		293,194
Total debt, including current portion	541,291		516,870
Capital Expenditures
Capital expenditures	49,489	52,725
Reimbursable Capital Expenditures	13,473	2,127
Communication services
Revenue
Revenue	181,268	181,308
Mobility
Revenue
Revenue	26,875	27,266
Mobility - Business
Revenue
Revenue	4,882	3,747
Mobility - Consumer
Revenue
Revenue	21,993	23,519
Fixed
Revenue
Revenue	119,205	117,793
Fixed - Business
Revenue
Revenue	53,497	53,433
Fixed - Consumer
Revenue
Revenue	65,708	64,360
Carrier services
Revenue
Revenue	33,626	35,774
Other communication services
Revenue
Revenue	1,562	475
Construction.
Revenue
Revenue	1,586	590
Other revenue
Revenue
Revenue	3,940	3,876
Managed Services
Revenue
Revenue	3,940	3,876
Corporate and Other
Revenue
Depreciation	78	731
Non-cash stock-based compensation	1,754	1,634
Operating income (loss)	(7,708)	(8,847)
Segment Assets
Cash, cash equivalents, and restricted cash	1,561		2,239
Total current assets	11,147		11,035
Fixed Assets, net	6,178		4,915
Total assets	92,603		91,619
Total current liabilities	30,357		37,357
Total debt, including current portion	185,519		159,009
Capital Expenditures
Capital expenditures	1,341
International Telecom \| Operating segments
Revenue
Revenue	93,059	90,408
Depreciation	16,124	14,186
Amortization of intangibles from acquisitions	251	380
Non-cash stock-based compensation	23	67
Operating income (loss)	11,685	13,825
Segment Assets
Cash, cash equivalents, and restricted cash	35,369		26,354
Total current assets	121,262		107,469
Fixed Assets, net	479,325		481,911
Goodwill	4,835		4,836
Total assets	679,591		672,171
Total current liabilities	87,986		86,540
Total debt, including current portion	59,776		64,254
Capital Expenditures
Capital expenditures	16,915	21,464
International Telecom \| Operating segments \| Communication services
Revenue
Revenue	91,750	89,088
International Telecom \| Operating segments \| Mobility
Revenue
Revenue	26,037	26,107
International Telecom \| Operating segments \| Mobility - Business
Revenue
Revenue	4,808	3,575
International Telecom \| Operating segments \| Mobility - Consumer
Revenue
Revenue	21,229	22,532
International Telecom \| Operating segments \| Fixed
Revenue
Revenue	61,321	58,891
International Telecom \| Operating segments \| Fixed - Business
Revenue
Revenue	18,532	17,113
International Telecom \| Operating segments \| Fixed - Consumer
Revenue
Revenue	42,789	41,778
International Telecom \| Operating segments \| Carrier services
Revenue
Revenue	3,574	3,690
International Telecom \| Operating segments \| Other communication services
Revenue
Revenue	818	400
International Telecom \| Operating segments \| Other revenue
Revenue
Revenue	1,309	1,320
International Telecom \| Operating segments \| Managed Services
Revenue
Revenue	1,309	1,320
US Telecom \| Operating segments
Revenue
Revenue	93,735	95,366
Depreciation	18,138	21,487
Amortization of intangibles from acquisitions	1,729	2,867
Non-cash stock-based compensation	132	77
Operating income (loss)	597	(4,342)
Segment Assets
Cash, cash equivalents, and restricted cash	32,288		33,574
Total current assets	157,318		162,768
Fixed Assets, net	585,979		593,833
Goodwill	35,269		35,268
Total assets	1,006,960		1,019,924
Total current liabilities	155,274		169,297
Total debt, including current portion	295,996		$ 293,607
Capital Expenditures
Capital expenditures	31,233	31,261
US Telecom \| Operating segments \| Communication services
Revenue
Revenue	89,518	92,220
US Telecom \| Operating segments \| Mobility
Revenue
Revenue	838	1,159
US Telecom \| Operating segments \| Mobility - Business
Revenue
Revenue	74	172
US Telecom \| Operating segments \| Mobility - Consumer
Revenue
Revenue	764	987
US Telecom \| Operating segments \| Fixed
Revenue
Revenue	57,884	58,902
US Telecom \| Operating segments \| Fixed - Business
Revenue
Revenue	34,965	36,320
US Telecom \| Operating segments \| Fixed - Consumer
Revenue
Revenue	22,919	22,582
US Telecom \| Operating segments \| Carrier services
Revenue
Revenue	30,052	32,084
US Telecom \| Operating segments \| Other communication services
Revenue
Revenue	744	75
US Telecom \| Operating segments \| Construction.
Revenue
Revenue	1,586	590
US Telecom \| Operating segments \| Other revenue
Revenue
Revenue	2,631	2,556
US Telecom \| Operating segments \| Managed Services
Revenue
Revenue	$ 2,631	$ 2,556

SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2024

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

14. SUBSEQUENT EVENTS

On May 8, 2024, the Company entered into a Consent Decree with the FCC Enforcement Bureau, regarding both the USAC and FCC Enforcement Bureau’s investigation and agreed to (i) a settlement amount of approximately $6.3 million, and (ii) enter into a three-year compliance agreement in connection with Alaska Communication’s continued

participation in the RHC Program. At this time, we believe that we can comply with all of the terms of the compliance agreement.

The settlement amount of $6.3 million consists of a $5.3 million cash payment and the $1.0 million forgiveness of certain receivables, both of which have been accrued on the Company’s balance sheet as of March 31, 2024. As such, this settlement will not impact the statement of operations in future periods.

EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS

3 Months Ended

Mar. 31, 2024

EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS

EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS

11. EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS

Earnings Per Share

The following table reconciles the numerator and denominator in the computations of basic and diluted earnings per share (in thousands):


	Three months ended March 31,
	2024		2023
Numerator:
Net loss attributable to ATN International, Inc. stockholders- Basic		(6,315)		(5,885)
Less: Preferred dividends		(1,348)		(1,045)
Net Loss attributable to ATN International, Inc. common stockholders- Diluted	$	(7,663)	$	(6,930)

Denominator:
Weighted-average shares outstanding- Basic		15,437		15,768
Weighted-average shares outstanding- Diluted		15,437		15,768

Redeemable Noncontrolling Interests

In connection with certain acquisitions, the Company accounts for third-party non-controlling minority investments as redeemable noncontrolling interests, which consist of both redeemable common and, in some instances, preferred units, in its consolidated financial statements.

The common units contain put options allowing the holder to sell at a future date, the common units to a subsidiary of the Company at the then fair market value. The common units participate in the earnings and losses of the subsidiaries and are allocated their applicable share of earnings and losses. After the allocation of earnings and losses, the Company estimates the fair value of the common units and adjusts the book value of the common units to that estimated fair value.

The preferred units contain put options allowing the holder to sell at a future date, the preferred units to a subsidiary of the Company at a fixed price equal to face value of the units plus unpaid dividends. The preferred units hold a distribution preference over common units and carry a fixed dividend rate.

The put options for both the common and preferred units, if any, are nonrecourse to the Company and exercisable at the earlier of a future initial public offering of the subsidiary or certain dates beginning in 2026.

For the three months ended March 31, 2024 and 2023, the Company allocated losses of $3.5 million and $2.8 million, respectively, to the redeemable common units representing their proportionate share of operating losses. The Company then compared the book value of the common units to the fair value and the fair value exceeded the book value. As a result, the book value was increased by $0.9 million and $2.5 million during the three months ended March 31, 2024 and 2023, respectively.

The following table provides a roll forward of the activity related to the Company’s redeemable noncontrolling interests for the three months ended March 31, 2024 and 2023 (in thousands):


	Redeemable Preferred Units		Redeemable Common Units		Total Redeemable Noncontrolling Interests
Balance, December 31, 2023	$	60,094	$	25,823	$	85,917
Accrued preferred dividend		1,348		—		1,348
Allocated net loss		—		(3,512)		(3,512)
Change in fair value		—		868		868
Balance, March 31, 2024	$	61,442	$	23,179	$	84,621


	Redeemable Preferred Units		Redeemable Common Units		Total Redeemable Noncontrolling Interests
Balance, December 31, 2022	$	55,152	$	37,317	$	92,469
Accrued preferred dividend		1,045		—		1,045
Allocated net loss		—		(2,821)		(2,821)
Change in fair value		—		2,530		2,530
Balance, March 31, 2023	$	56,197	$	37,026	$	93,223

REVENUE RECOGNITION AND RECEIVABLES - Allowance for Credit Losses Roll forward (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
REVENUE RECOGNITION AND RECEIVABLES
Balance at beginning of period	$ 16,362	$ 15,171
Current period provision for expected losses	1,322	1,378
Write-offs charged against the allowance	(903)	(591)
Recoveries collected	83	74
Balance at end of period	$ 16,864	$ 16,032

REVENUE RECOGNITION AND RECEIVABLES - Timing of Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
REVENUE RECOGNITION AND RECEIVABLES
Total revenue	$ 172,908	$ 172,557
Operating lease income	2,106	1,903
Government grant revenue	11,780	11,314
Total revenue	186,794	185,774
Services transferred over time
REVENUE RECOGNITION AND RECEIVABLES
Total revenue	166,603	166,752
Goods and services transferred at a point in time
REVENUE RECOGNITION AND RECEIVABLES
Total revenue	6,305	5,805
International Telecom
REVENUE RECOGNITION AND RECEIVABLES
Total revenue	91,594	88,939
Operating lease income	72	72
Government grant revenue	1,393	1,397
Total revenue	93,059	90,408
International Telecom \| Services transferred over time
REVENUE RECOGNITION AND RECEIVABLES
Total revenue	88,560	85,680
International Telecom \| Goods and services transferred at a point in time
REVENUE RECOGNITION AND RECEIVABLES
Total revenue	3,034	3,259
US Telecom
REVENUE RECOGNITION AND RECEIVABLES
Total revenue	81,314	83,618
Operating lease income	2,034	1,831
Government grant revenue	10,387	9,917
Total revenue	93,735	95,366
US Telecom \| Services transferred over time
REVENUE RECOGNITION AND RECEIVABLES
Total revenue	78,043	81,072
US Telecom \| Goods and services transferred at a point in time
REVENUE RECOGNITION AND RECEIVABLES
Total revenue	$ 3,271	$ 2,546

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Paragraph 32
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

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ORGANIZATION AND BUSINESS OPERATIONS

ORGANIZATION AND BUSINESS OPERATIONS

3 Months Ended

Mar. 31, 2024

ORGANIZATION AND BUSINESS OPERATIONS

1.ORGANIZATION AND BUSINESS OPERATIONS

The Company is a leading provider of digital infrastructure and communications services with a focus on rural and remote markets in the United States, and internationally, including Bermuda and the Caribbean region.

The Company has developed significant operational expertise and resources that it uses to augment its capabilities in its local markets. With this support, the Company’s operating subsidiaries are able to improve their quality of service with greater economies of scale and expertise than would typically be available in the size markets they operate in. The Company provides management, technical, financial, regulatory, and marketing services to its operating subsidiaries and typically receives a management fee calculated as a percentage of their revenues, which is eliminated in consolidation. The Company also actively evaluates investment opportunities and other strategic transactions, both domestic and international, and generally looks for those that it believes fit the Company’s profile of telecommunications businesses and have the potential to complement the Company’s “First-to-Fiber” and “Glass & Steel™” approach in markets while keeping a focus on generating excess operating cash flows over extended periods of time. The Company uses the cash generated from its operations to maintain an appropriate ratio of debt and cash on hand and to fund growth and capital expenditures, to return cash to its stockholders through dividends or stock repurchases, and make strategic investments or acquisitions.

For further information about the Company’s financial segments and geographical information about its operating revenues and assets, see Notes 1 and 12 to the Consolidated Financial Statements included in this Report.

As of March 31, 2024, the Company offered the following types of services to its customers:

●

Mobile Telecommunications Services. The Company offers mobile communications services over its wireless networks and related equipment (such as handsets) to both business and consumer customers.

●

Fixed Telecommunications Services. The Company provides fixed data and voice telecommunications services to business and consumer customers. These services include consumer broadband and high-speed data solutions for businesses. For some markets, fixed services also include video services and revenue derived from support under certain government programs.

●

Carrier Telecommunication Services. The Company delivers services to other telecommunications providers including the leasing of critical network infrastructure such as tower and transport facilities, wholesale roaming and long distance voice services, site maintenance and international long-distance services.

●

Managed Services. The Company provides information technology services such as network, application, infrastructure and hosting services to both its business and consumer customers to complement its fixed services in its existing markets.

Through March 31, 2024, the Company identified two operating segments to manage and review its operations and to facilitate investor presentations of its results. These two operating segments are as follows:

●

International Telecom. In the Company’s international markets, it offers fixed services, mobility services, carrier services and managed services to customers in Bermuda, the Cayman Islands, Guyana and the US Virgin Islands.

●

US Telecom. In the United States, the Company offers fixed services, carrier services, and managed services to business customers and consumers in Alaska and the western United States. As of March 31,

2024 the Company provided mobility services to retail customers in the western United States.


International Telecom			US Telecom
Services	Markets	Tradenames	Services	Markets	Tradenames
Mobility Services	Bermuda, Guyana, US Virgin Islands	One, GTT, Viya	Mobility Services	United States (rural markets)	Choice, Choice NTUA Wireless
Fixed Services	Bermuda, Cayman Islands, Guyana, US Virgin Islands	One, Logic, GTT, Viya	Fixed Services	United States	Alaska Communications, Commnet, Choice, Choice NTUA Wireless, Sacred Wind Communications, Ethos, Deploycom
Carrier Services	Bermuda, Guyana, US Virgin Islands	One, Essextel, GTT, Viya	Carrier Services	United States	Alaska Communications, Commnet, Sacred Wind Communications
Managed Services	Bermuda, Cayman Islands, US Virgin Islands, Guyana	Fireminds, One, Logic, GTT, Viya, Brava	Managed Services	United States	Alaska Communications, Choice

For further information about the Company’s financial segments and geographical information about its operating revenues and assets, see Note 12 to the Unaudited Condensed Consolidated Financial Statements included in this Report.

Restructuring Expense

In order to reduce the Company’s US Telecom and International Telecom segments’ cost structure, the Company has incurred, since the first quarter of 2023, certain network termination and reduction in force costs totaling $12.4 million through March 31, 2024. Of this amount, $1.2 million and $2.9 million were recorded during the three months ended March 31, 2024 and 2023, respectively. A summary of the costs, since the first quarter of 2023, is below (in thousands):


		US		International
		Telecom		Telecom		Total
Employee termination benefits	$	1,960	$	4,681	$	6,641
Contract termination costs		5,777		—		5,777
Total	$	7,737	$	4,681	$	12,418

The charge is recorded in Restructuring Expenses on the Company’s Consolidated Income Statements. During the three months ended March 31, 2024, the Company paid $2.0 million of the restructuring costs. In total, since the first quarter of 2023 and through March 31, 2024, the Company paid $7.7 million, recorded a gain of $0.3 million on lease termination, and $5.0 million of the restructuring costs remain accrued. In conjunction with the restructuring, the Company terminated certain leases and removed $5.6 million of lease right of use assets and $5.9 million of lease liabilities from its balance sheet.

LONG-TERM DEBT (Tables)

3 Months Ended

Mar. 31, 2024

LONG-TERM DEBT

Schedule of quarterly repayments


2023 CoBank Term Loan Quarterly Payment Dates	2023 CoBank Term Loan Quarterly Repayments
December 31, 2023 – June 30, 2025	$812,500 (2.5% per annum)
September 30, 2025 – June 30, 2026	$1,625,000 (5% per annum)
September 30, 2026 – June 30, 2029	$2,437,500 (7.5% per annum)

Schedule of future principal repayments annual maturities of the Company's debt instruments

The table below summarizes the annual maturities of the Company’s debt instruments (amounts in thousands).


									Customer
	US		International		Corporate and		Total		Receivable
Amounts Maturing During	Telecom		Telecom		Other		Debt		Credit Facility
April 1, 2024 through December 31, 2024	$	13,549	$	—	$	2,438	$	15,987	$	5,644
Year ending December 31, 2025		14,969		—		4,875		19,844		7,830
Year ending December 31, 2026		253,469		60,000		8,125		321,594		8,192
Year ending December 31, 2027		3,723		—		9,750		13,473		8,572
Year ending December 31, 2028		3,858		—		9,750		13,608		8,973
Thereafter		10,192		—		154,257		164,449		9,221
Total		299,760		60,000		189,195		548,955		48,432
Debt Discounts		(3,764)		(224)		(3,676)		(7,664)		(455)
Book Value as of March 31, 2024	$	295,996	$	59,776	$	185,519	$	541,291	$	47,977

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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RETIREMENT PLANS

3 Months Ended

Mar. 31, 2024

RETIREMENT PLANS

RETIREMENT PLANS

9. RETIREMENT PLANS

Multi-employer Defined Benefit Plan

Pension benefits for substantially all of the Company’s Alaska-based employees are provided through the Alaska Electrical Pension Fund (“AEPF”). The Company pays a contractual hourly amount based on employee classification or base compensation to the AEPF. As a multi-employer defined benefit plan, the accumulated benefits

and plan assets are not determined for, or allocated separately to, the individual employer. This plan was not in endangered or critical status during the plan year.

Defined Benefit Plan

The Company has noncontributory defined benefit pension and noncontributory defined medical, dental, vision, and life benefit plans for eligible employees who meet certain eligibility criteria. The majority of benefits under the plans are frozen and the plans no longer allow new participants to join.

The Company recorded the net periodic benefit cost identified below (in thousands):


	Three months ended
	March 31, 2024				March 31, 2023
	Pension benefits		Postretirement benefits		Pension benefits		Postretirement benefits
Operating expense
Service cost	$	22	$	16	$	38	$	31
Non-operating expense
Interest cost		824		45		593		35
Expected return on plan assets		(729)		—		(953)		—
Amortization of unrecognized actuarial gain		(11)		(28)		—		—
Settlements		—		—		369		—
Net periodic pension expense (benefit)	$	106	$	33	$	47	$	66

The Company was not required to make contributions to its pension plans during the three months ended March 31, 2024 and 2023. However, the Company periodically evaluates whether to make discretionary contributions. The Company funds its postretirement benefit plans as claims are made and did not make contributions to its pension plans during the three months ended March 31, 2024 and 2023.

The entire disclosure for retirement benefits.

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current Assets:
Cash and cash equivalents	$ 56,467	$ 49,225
Restricted cash	12,751	12,942
Short-term investments	300	300
Accounts receivable, net of allowances for credit losses of $16.9 million and $16.4 million, respectively	138,456	138,616
Customer receivable	7,506	7,249
Inventory, materials and supplies	16,207	19,133
Prepayments and other current assets	58,040	53,807
Total current assets	289,727	281,272
Fixed Assets, net	1,071,482	1,080,659
Telecommunication licenses, net	113,319	113,319
Goodwill	40,104	40,104
Intangible assets, net	17,685	19,585
Operating lease right-of-use assets	97,735	99,335
Customer receivable - long term	45,165	45,676
Other assets	103,937	103,764
Total assets	1,779,154	1,783,714
Current Liabilities:
Current portion of long-term debt	20,476	24,290
Current portion of customer receivable credit facility	7,569	7,110
Accounts payable and accrued liabilities	161,418	182,069
Dividends payable	3,757	3,701
Accrued taxes	11,642	10,876
Current portion of lease liabilities	15,674	15,164
Advance payments and deposits	53,081	49,984
Total current liabilities	273,617	293,194
Deferred income taxes	18,123	19,775
Lease liabilities, excluding current portion	74,856	76,936
Deferred revenue, long-term	61,611	64,035
Other liabilities	76,387	74,531
Customer receivable credit facility, net of current portion	40,408	38,943
Long-term debt, excluding current portion	520,815	492,580
Total liabilities	1,065,817	1,059,994
Total redeemable noncontrolling interests	84,621	85,917
ATN International, Inc. Stockholders' Equity:
Preferred stock, $0.01 par value per share; 10,000,000 shares authorized, none issued and outstanding
Common stock, $0.01 par value per share; 50,000,000 shares authorized; 17,845,445 and 17,702,476 shares issued, respectively, 15,501,510 and 15,421,481 shares outstanding, respectively	173	173
Treasury stock, at cost; 2,343,935 and 2,280,995 shares, respectively	(92,463)	(90,447)
Additional paid-in capital	207,551	205,797
Retained earnings	405,031	417,282
Accumulated other comprehensive income	9,700	8,268
Total ATN International, Inc. stockholders' equity	529,992	541,073
Noncontrolling interests	98,724	96,730
Total equity	628,716	637,803
Total liabilities, redeemable noncontrolling interests and equity	1,779,154	1,783,714
Redeemable preferred units
Current Liabilities:
Total redeemable noncontrolling interests	61,442	60,094
Redeemable common units
Current Liabilities:
Total redeemable noncontrolling interests	$ 23,179	$ 25,823

INCOME TAXES

3 Months Ended

Mar. 31, 2024

INCOME TAXES

INCOME TAXES

10. INCOME TAXES

The Company’s effective tax rate for the three months ended March 31, 2024 and 2023 was (25.6%) and 9.5%, respectively.

The Company recorded an income tax expense of $1.6 million in relation to a pretax loss of $6.3 million for the three months ended March 31, 2024. The effective tax rate for the three months ended March 31, 2024 was primarily impacted by the following items: (i) the mix of income generated among the jurisdictions in which the Company operates, (ii) net expense related to valuation allowances placed on certain deferred tax assets that are not expected to be realizable based on the weight of positive and negative evidence, (iii) forecasted tax impact of global intangible low-taxed income (“GILTI”) inclusion, and (iv) discrete items including expense of $1.5 million to record an uncertain tax position for the current year, and expense of $0.7 million for interest on uncertain tax positions for prior years.

The Company recorded an income tax benefit of $0.7 million in relation to a pretax loss of $7.8 million for the three months ended March 31, 2023. The effective tax rate for the three months ended March 31, 2023 was primarily impacted by the following items: (i) the mix of income generated among the jurisdictions in which the Company operates, (ii) a net increase related to valuation allowances placed on certain deferred tax assets and (iii) discrete items including $0.6 million of expense for interest on unrecognized tax positions.

The Company’s effective tax rate is based upon estimated income before provision for income taxes for the year, composition of the income in different countries, and adjustments, if any, in the applicable quarterly periods for potential tax consequences, benefits and/or resolutions of tax contingencies. The Company’s consolidated tax rate will

continue to be impacted by any transactional or one-time items in the future and the mix of income in any given year generated among the jurisdictions in which the Company operates. While the Company believes it has adequately provided for all tax positions, amounts asserted by taxing authorities could materially differ from the Company’s accrued positions as a result of uncertain and complex applications of tax law and regulations. Additionally, the recognition and measurement of certain tax benefits include estimates and judgments by management. Accordingly, the Company could record additional provisions or benefits for US federal, state, and foreign tax matters in future periods as new information becomes available.

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

Summary of components of lease expense

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Non-controlling interest, net of tax (benefit) expense	$ 0.3	$ (0.6)

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2024	May 10, 2024
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2024
Entity File Number	001-12593
Entity Registrant Name	ATN INTERNATIONAL, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	47-0728886
Entity Address, Address Line One	500 Cummings Center
Entity Address, Address Line Two	Suite 2450
Entity Address, City or Town	Beverly
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	01915
City Area Code	978
Local Phone Number	619-1300
Title of 12(b) Security	Common Stock, par value $.01 per share
Trading Symbol	ATNI
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		15,317,229
Entity Central Index Key	0000879585
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Amendment Flag	false

RETIREMENT PLANS - Net Periodic Pension Cost (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Components of the plan's net periodic pension cost
Settlements		$ 369
Pension benefits
Components of the plan's net periodic pension cost
Service cost	$ 22	38
Interest cost	824	593
Expected return on plan assets	(729)	(953)
Amortization of unrecognized actuarial gain	(11)
Settlements		369
Net periodic pension expense (benefit)	106	47
Postretirement benefits
Components of the plan's net periodic pension cost
Service cost	16	31
Interest cost	45	35
Amortization of unrecognized actuarial gain	(28)
Net periodic pension expense (benefit)	$ 33	$ 66

FAIR VALUE MEASUREMENTS AND INVESTMENTS - Investments (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Roll forward of investments
Beginning balance	$ 42,907	$ 38,169
Income recognized	19	315
Contributions / (distributions)	(140)	630
Foreign currency loss		111
Ending balance	42,786	39,225
Investments without a readily determinable fair value
Roll forward of investments
Beginning balance	41,710	22,590
Ending balance	41,710	22,590
Fair value investments
Roll forward of investments
Beginning balance	1,197	1,616
Income recognized	19	77
Contributions / (distributions)	(140)
Ending balance	$ 1,076	1,693
Equity method investments
Roll forward of investments
Beginning balance		13,963
Income recognized		238
Contributions / (distributions)		630
Foreign currency loss		111
Ending balance		$ 14,942

LEASES (Tables)

3 Months Ended

Mar. 31, 2024

LEASES

The components of lease expense were as follows (in thousands):


	Three months ended
	March 31, 2024		March 31, 2023
Operating lease cost:
Operating lease cost	$	5,479	$	5,981
Short-term lease cost		691		677
Variable lease cost		1,429		662
Total operating lease cost	$	7,599	$	7,320

Finance lease cost:
Amortization of right-of-use asset	$	612	$	699
Variable costs		198		203
Interest costs		100		84
Total finance lease cost	$	910	$	986

Summary of weighted-average remaining lease term and discount rate


	March 31, 2024		December 31, 2023
Weighted-average remaining lease term
Operating leases		12.9 years		13.3 years
Financing leases		9.2 years		9.2 years

Weighted-average discount rate
Operating leases		6.6%		6.3%
Financing leases		7.2%		6.6%

Summary of maturities of operating lease liabilities

Maturities of lease liabilities as of March 31, 2024 were as follows (in thousands):


	Operating Leases		Financing Leases
2024 (excluding the three months ended March 31, 2024)	$	13,608	$	1,614
2025		16,800		1,394
2026		12,405		570
2027		9,542		534
2028		7,553		505
Thereafter		82,078		2,145
Total lease payments		141,986		6,762
Less imputed interest		(56,664)		(1,555)
Total	$	85,322	$	5,207

Maturities of lease liabilities as of December 31, 2023 were as follows (in thousands):


	Operating Leases		Financing Leases
2024	$	18,048	$	2,030
2025		16,022		1,488
2026		11,755		601
2027		9,327		534
2028		7,807		505
Thereafter		80,637		2,145
Total lease payments		143,596		7,303
Less imputed interest		(57,133)		(1,662)
Total	$	86,463	$	5,641

Summary of maturities of finance lease liabilities


	Operating Leases		Financing Leases
2024 (excluding the three months ended March 31, 2024)	$	13,608	$	1,614
2025		16,800		1,394
2026		12,405		570
2027		9,542		534
2028		7,553		505
Thereafter		82,078		2,145
Total lease payments		141,986		6,762
Less imputed interest		(56,664)		(1,555)
Total	$	85,322	$	5,207


	Operating Leases		Financing Leases
2024	$	18,048	$	2,030
2025		16,022		1,488
2026		11,755		601
2027		9,327		534
2028		7,807		505
Thereafter		80,637		2,145
Total lease payments		143,596		7,303
Less imputed interest		(57,133)		(1,662)
Total	$	86,463	$	5,641

Schedule of maturities of future undiscounted lease payments

The following table presents the maturities of future undiscounted lease payments for the periods indicated (in thousands):


2024 (excluding the three months ended March 31, 2024)	$	5,995
2025		7,060
2026		6,749
2027		5,559
2028		5,180
Thereafter		13,353
Total future lease payments	$	43,896

LONG-TERM DEBT - Debt Maturity (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Debt Instrument [Line Items]
Book Value	$ 541,291	$ 516,870
Total Debt
Debt Instrument [Line Items]
April 1, 2024 through December 31, 2024	15,987
Year ending December 31, 2025	19,844
Year ending December 31, 2026	321,594
Year ending December 31, 2027	13,473
Year ending December 31, 2028	13,608
Thereafter	164,449
Total	548,955
Debt Discounts	(7,664)
Book Value	541,291
Customer receivable credit facility
Debt Instrument [Line Items]
April 1, 2024 through December 31, 2024	5,644
Year ending December 31, 2025	7,830
Year ending December 31, 2026	8,192
Year ending December 31, 2027	8,572
Year ending December 31, 2028	8,973
Thereafter	9,221
Total	48,432
Debt Discounts	(455)
Book Value	47,977
Corporate and Other
Debt Instrument [Line Items]
April 1, 2024 through December 31, 2024	2,438
Year ending December 31, 2025	4,875
Year ending December 31, 2026	8,125
Year ending December 31, 2027	9,750
Year ending December 31, 2028	9,750
Thereafter	154,257
Total	189,195
Debt Discounts	(3,676)
Book Value	185,519	159,009
US Telecom \| Operating segments
Debt Instrument [Line Items]
Book Value	295,996	293,607
US Telecom \| Operating segments \| Total Debt
Debt Instrument [Line Items]
April 1, 2024 through December 31, 2024	13,549
Year ending December 31, 2025	14,969
Year ending December 31, 2026	253,469
Year ending December 31, 2027	3,723
Year ending December 31, 2028	3,858
Thereafter	10,192
Total	299,760
Debt Discounts	(3,764)
Book Value	295,996
International Telecom \| Operating segments
Debt Instrument [Line Items]
Book Value	59,776	$ 64,254
International Telecom \| Operating segments \| Total Debt
Debt Instrument [Line Items]
Year ending December 31, 2026	60,000
Total	60,000
Debt Discounts	(224)
Book Value	$ 59,776

FAIR VALUE MEASUREMENTS AND INVESTMENTS - Recurring (Details) - Recurring basis - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Fair value measurements
Total assets and liabilities measured at fair value	$ (19,061)	$ (21,561)
Short Term Investments
Fair value measurements
Investments	300	300
Other investments
Fair value measurements
Investments	1,076	1,197
Employee benefit plan investments
Fair value measurements
Investments	2,991	3,014
Redeemable common units \| Alloy Inc
Fair value measurements
Financial instruments	(14,760)	(14,760)
Redeemable common units \| Alaska communications
Fair value measurements
Financial instruments	(8,419)	(11,063)
Warrants \| Alaska communications
Fair value measurements
Financial instruments	(249)	(249)
Level 1
Fair value measurements
Total assets and liabilities measured at fair value	3,291	3,314
Level 1 \| Short Term Investments
Fair value measurements
Investments	300	300
Level 1 \| Employee benefit plan investments
Fair value measurements
Investments	2,991	3,014
Level 3
Fair value measurements
Total assets and liabilities measured at fair value	(22,352)	(24,875)
Level 3 \| Other investments
Fair value measurements
Investments	1,076	1,197
Level 3 \| Redeemable common units \| Alloy Inc
Fair value measurements
Financial instruments	(14,760)	(14,760)
Level 3 \| Redeemable common units \| Alaska communications
Fair value measurements
Financial instruments	(8,419)	(11,063)
Level 3 \| Warrants \| Alaska communications
Fair value measurements
Financial instruments	$ (249)	$ (249)

GOVERNMENT SUPPORT AND SPECTRUM MATTERS

3 Months Ended

Mar. 31, 2024

GOVERNMENT SUPPORT AND SPECTRUM MATTERS

GOVERNMENT SUPPORT AND SPECTRUM MATTERS

8. GOVERNMENT SUPPORT AND SPECTRUM MATTERS

Universal Service Fund and Other Domestic Funding Programs

The Company recognizes revenue from several government funded programs including the Universal Service Fund (“USF”), a subsidy program managed by the Federal Communications Commission (“FCC”), and the Alaska Universal Service Fund (“AUSF”), a similar program managed by the Regulatory Commission of Alaska (the “RCA”). USF funds are disbursed to telecommunication providers through four programs the High Cost Program; the Low Income Program (“Lifeline Program”); the Schools and Libraries Program (“E-Rate Program”); and the Rural Health Care Support Program (“RHC”). The Company’s International Telecom segment receives $5.5 million of legacy frozen high cost support funding in the US Virgin Islands. This funding expires on December 31, 2025.

The Company also recognizes revenue from the Connect America Fund Phase II program (“CAF II”) which offers subsidies to carriers to expand broadband coverage in designated areas. Under CAF II, the Company’s US Telecom segment will receive an aggregate of $27.7 million annually through December 2025 and an aggregate of $8.0 million annually from January 2026 through July 2028.

The Company also recognizes revenue from the FCC’s Affordable Connectivity Program (“ACP”) and the Emergency Connectivity Fund (“ECF”). The ACP provides eligible low-income consumers with a monthly subsidy for broadband connectivity and the ECF provides schools and libraries with subsidies for broadband connectivity. Funding under the ACP and ECF programs is set to expire in the second quarter of 2024.

The Company was awarded approximately $22.7 million over 10 years to provide broadband and voice coverage to over 10,000 households in the United States (not including Alaska) under the 2020 Rural Digital Opportunity Fund Phase I Auction (“RDOF”). Revenue recognized from the RDOF program is recognized as revenue from government grants.

All of the programs are subject to certain operational and reporting compliance requirements. The Company believes it is in compliance with these requirements as of March 31, 2024. Revenue recognized from the USF and CAF II programs is recognized as revenue from government grants. Revenue from other programs is recognized in accordance with ASC 606.

The Company recorded the amounts below as communication services revenue for the reported periods (in thousands):


	Three months ended
	March 31, 2024

	US Telecom		International Telecom		Total

High cost support	$	3,455	$	1,393	$	4,848
CAF II		6,787		—		6,787
RDOF		145		—		145
ECF		6,813		—		6,813
RHC		3,437		—		3,437
Other		6,701		315		7,016
Total	$	27,338	$	1,708	$	29,046


	Three months ended
	March 31, 2023

	US Telecom		International Telecom		Total

High cost support	$	2,494	$	1,397	$	3,891
CAF II		6,815		—		6,815
RDOF		608		—		608
ECF		8,067		—		8,067
RHC		2,900		—		2,900
Other		4,693		4		4,697
Total	$	25,577	$	1,401	$	26,978

Construction Grants


		Amount
Grants awarded, December 31, 2023	$	100,149
New grants		—
Construction complete		—
Grants awarded, March 31, 2024	$	100,149

During the three months ended March 31, 2024, the Company disbursed capital expenditures of $3.4 million under these programs and received reimbursement of $1.9 million. These cash flows are classified as investing activities in the Company’s statement of cash flows.

In addition, the Company partners with tribal governments to obtain grants under various government programs including the Tribal Broadband Connectivity Program (“TBCP”) and the Rural Development Broadband ReConnect Program (“ReConnect”). The TBCP and ReConnect programs are administered by United States government agencies to deploy broadband connectivity in certain underserved areas. The Company was identified as a sub recipient of grants under these programs totaling $192.6 million as of March 31, 2024. Through March 31, 2024, the Company has received $10.4 million of funding under these programs and spent $10.1 million on construction obligations. These amounts are recorded as operating cash flows in the company’s statement of cash flows.

Replace and Remove Program

On July 15, 2022, the Company was notified that it was an approved participant in the Federal Communication Commission’s Secure and Trusted Communications Networks Reimbursement Program (the “Replace and Remove Program”), designed to reimburse providers of communications services for reasonable costs incurred in the required removal, replacement, and disposal of covered communications equipment or services, that have been deemed to pose a national security risk, from their networks. Pursuant to the Replace and Remove Program, the Company was allocated up to approximately $207 million in reimbursement amounts to cover documented and approved costs to remove and securely destroy all ZTE communications equipment and services in its U.S. networks and replace such equipment. The Replace and Remove Program requires that the Company complete the project no later than one year from submitting its initial reimbursement request, or by July 2024. In April 2024, the FCC granted the Company’s request to extend the program’s completion deadlines to the first quarter of 2025. At this time, the Company anticipates that it will be able to meet the deadlines and requirements of the program.

A summary of the amounts spent and reimbursed under the Replace and Remove Program is below (in thousands):


	Capital		Operating		Total

Total spend, December 31, 2023	$	49,262	$	15,126	$	64,388
Amounts spent		11,734		4,568		16,302
Total spend, March 31, 2024	$	60,996	$	19,694	$	80,690

Total reimbursements, December 31, 2023	$	(12,773)	$	(4,354)	$	(17,127)
Reimbursements received		(8,586)		(5,843)		(14,429)
Total reimbursements, March 31, 2024	$	(21,359)	$	(10,197)	$	(31,556)

Amount pending reimbursement	$	39,637	$	9,497	$	49,134


	Capital		Operating		Total

Total spend, December 31, 2022	$	1,836	$	1,489	$	3,325
Amounts spent		1,485		1,900		3,385
Total spend, March 31, 2023	$	3,321	$	3,389	$	6,710

Amount pending reimbursement	$	3,321	$	3,389	$	6,710

At March 31, 2024, $33.4 million of the capital expenditures were accrued and unpaid. The Company expects to be reimbursed for all amounts spent within the next twelve months. Amounts identified as capital are recorded as investing cash flows and amounts identified as operating are recorded as operating cash flows in the Company’s statement of cash flows.

COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2024

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

13. COMMITMENTS AND CONTINGENCIES

Regulatory and Litigation Matters

The Company and its subsidiaries are subject to certain regulatory and legal proceedings and other claims arising in the ordinary course of business, some of which involve claims for damages and taxes that are substantial in amount. Historically, the Company’s subsidiary, GTT, has been subject to other long-standing litigation proceedings and disputes in Guyana that have not yet been resolved. The Company believes that, except for the items discussed below, for which the Company is currently unable to predict the final outcome, the disposition of matters currently pending will not have a material adverse effect on the Company’s financial position or results of operations.

Beginning in 2006, the National Frequency Management Unit (now the Telecommunications Agency, or the “NFMU/TA”) and GTT have been engaged in discussions regarding the amount of and methodology for calculation of spectrum fees payable by GTT in Guyana. Since that time, GTT has made payments of undisputed spectrum fees as amounts invoiced by the NFMU, and to its successor, the Telecommunications Authority (“TA”). There have been limited further discussions on the subject of a revised spectrum fee methodology with the TA.

GTT has filed several lawsuits in the High Court of Guyana asserting that, despite its denials, Digicel is engaged in international bypass in violation of GTT’s exclusive license rights, the interconnection agreement between the parties, and the laws of Guyana. Digicel filed counterclaims alleging that GTT has violated the terms of the interconnection agreement and Guyana laws. These suits, filed in 2010 and 2012, are currently pending in the Court of Appeals in Guyana, however, the Company cannot accurately predict at this time when the consolidated suit will reach a court of final determination.

GTT is also involved in several legal claims regarding its tax filings with the Guyana Revenue Authority (the “GRA”) dating back to 1991 regarding the deductibility of intercompany advisory fees as well as other tax assessments. GTT has maintained that it has no unpaid corporation tax due to the GRA and that any liability GTT might be found to have with respect to the disputed tax assessments would be offset in part by the amounts claimed with respect to rights ATN has pursuant to its agreement with the government of Guyana. GTT’s position has been upheld by various High Court rulings made in its favor including most recently in December 2021, and while some matters have been appealed by the GRA, other matters remain pending for determination by the High Court.

In February 2020, the Company’s Alaska Communications subsidiary received a draft audit report from USAC in connection with USAC’s inquiry into Alaska Communications’ funding requests under the Rural Health Care Support Program for certain customers for the time period of July 2012 through June 2017. Alaska Communications also received a Letter of Inquiry on March 18, 2018, and subsequent follow up information requests, from the FCC Enforcement Bureau requesting historical information regarding Alaska Communications’ participation in the FCC’s Rural Health Care Support Program.

On May 8, 2024, we entered into a Consent Decree with the FCC Enforcement Bureau, regarding both the USAC and FCC Enforcement Bureau’s investigation and agreed to (i) pay a settlement amount of approximately $6.3 million, and (ii) enter into a three-year compliance agreement in connection with Alaska Communication’s continued participation in the RHC Program. At this time, we believe that we can comply with all of the terms of the compliance agreement.

With respect to all of the foregoing matters, the Company believes that some adverse outcome is probable and has accordingly accrued $17.0 million as of March 31, 2024 for these and other potential liabilities arising in various claims, legal actions and regulatory proceedings arising in the ordinary course of business. The Company also faces contingencies that are reasonably possible to occur that cannot currently be estimated. It is the Company’s policy to expense costs associated with loss contingencies, including any related legal fees, as they are incurred.

EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS (Tables)

3 Months Ended

Mar. 31, 2024

EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS

Schedule of computation of basic and diluted earnings per share

The following table reconciles the numerator and denominator in the computations of basic and diluted earnings per share (in thousands):


	Three months ended March 31,
	2024		2023
Numerator:
Net loss attributable to ATN International, Inc. stockholders- Basic		(6,315)		(5,885)
Less: Preferred dividends		(1,348)		(1,045)
Net Loss attributable to ATN International, Inc. common stockholders- Diluted	$	(7,663)	$	(6,930)

Denominator:
Weighted-average shares outstanding- Basic		15,437		15,768
Weighted-average shares outstanding- Diluted		15,437		15,768

Schedule of rollforward activity related to the Company's redeemable noncontrolling interests

The following table provides a roll forward of the activity related to the Company’s redeemable noncontrolling interests for the three months ended March 31, 2024 and 2023 (in thousands):


	Redeemable Preferred Units		Redeemable Common Units		Total Redeemable Noncontrolling Interests
Balance, December 31, 2023	$	60,094	$	25,823	$	85,917
Accrued preferred dividend		1,348		—		1,348
Allocated net loss		—		(3,512)		(3,512)
Change in fair value		—		868		868
Balance, March 31, 2024	$	61,442	$	23,179	$	84,621


	Redeemable Preferred Units		Redeemable Common Units		Total Redeemable Noncontrolling Interests
Balance, December 31, 2022	$	55,152	$	37,317	$	92,469
Accrued preferred dividend		1,045		—		1,045
Allocated net loss		—		(2,821)		(2,821)
Change in fair value		—		2,530		2,530
Balance, March 31, 2023	$	56,197	$	37,026	$	93,223

GOVERNMENT SUPPORT AND SPECTRUM MATTERS - Construction (Details) - Network Connectivity for Eligible Communities $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Mobility Fund [Line Items]
Grants awarded	$ 100,149
Grants awarded	$ 100,149

REVENUE RECOGNITION AND RECEIVABLES (Tables)

3 Months Ended

Mar. 31, 2024

REVENUE RECOGNITION AND RECEIVABLES

Summary of revenues

Revenue accounted for in accordance with ASC 606 consisted of the following for the periods presented below (in thousands):


	Three months ended March 31,2024
	International		US
	Telecom		Telecom		Total
Services transferred over time	$	88,560	$	78,043	$	166,603
Goods and services transferred at a point in time		3,034		3,271		6,305
Total revenue accounted for under ASC 606	$	91,594	$	81,314	$	172,908
Operating lease income		72		2,034		2,106
Government grant revenue (1)		1,393		10,387		11,780
Total revenue	$	93,059	$	93,735	$	186,794


	Three months ended March 31,2023
	International		US
	Telecom		Telecom		Total
Services transferred over time	$	85,680	$	81,072	$	166,752
Goods and services transferred at a point in time		3,259		2,546		5,805
Total revenue accounted for under ASC 606	$	88,939	$	83,618	$	172,557
Operating lease income		72		1,831		1,903
Government grant revenue (1)		1,397		9,917		11,314
Total revenue	$	90,408	$	95,366	$	185,774

(1)

Revenue recognized from CAF II, USF and RDOF programs. Refer to Note 8.

Summary of contracts asset and liabilities

Contract assets and liabilities consisted of the following (amounts in thousands):


	March 31, 2024		December 31, 2023			$ Change	% Change
Contract asset – current	$	3,469	$	3,616	$	(147)		(4.1)	%
Contract asset – noncurrent		5,490		5,509		(19)		(0.3)	%
Contract liability – current		(31,721)		(30,990)		(731)		2.4	%
Contract liability – noncurrent		(61,611)		(64,035)		2,424		(3.8)	%
Net contract liability	$	(84,373)	$	(85,900)	$	1,527		(1.8)	%

Schedule of activity in allowances for credit losses

Activity in the allowance for credit losses is below (in thousands):


	Three months ended
	March 31, 2024		March 31, 2023

Balance at beginning of period	$	16,362	$	15,171
Current period provision for expected losses		1,322		1,378
Write-offs charged against the allowance		(903)		(591)
Recoveries collected		83		74
Balance at end of period	$	16,864	$	16,032

GOVERNMENT SUPPORT AND SPECTRUM MATTERS - Replace and Remove Program (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Remove And Replace Program
Mobility Fund [Line Items]
Beginning balance, Total spend	$ 64,388	$ 3,325
Amounts spent	16,302	3,385
Ending balance, Total spend	80,690	6,710
Beginning balance, Total reimbursements	(17,127)
Reimbursements received	(14,429)
Ending balance, Total reimbursements	(31,556)
Amount pending reimbursement	49,134	6,710
Capital Amount
Mobility Fund [Line Items]
Beginning balance, Total spend	49,262	1,836
Amounts spent	11,734	1,485
Ending balance, Total spend	60,996	3,321
Beginning balance, Total reimbursements	(12,773)
Reimbursements received	(8,586)
Ending balance, Total reimbursements	(21,359)
Amount pending reimbursement	39,637	3,321
Operating Amount
Mobility Fund [Line Items]
Beginning balance, Total spend	15,126	1,489
Amounts spent	4,568	1,900
Ending balance, Total spend	19,694	3,389
Beginning balance, Total reimbursements	(4,354)
Reimbursements received	(5,843)
Ending balance, Total reimbursements	(10,197)
Amount pending reimbursement	$ 9,497	$ 3,389

LONG-TERM DEBT

3 Months Ended

Mar. 31, 2024

LONG-TERM DEBT

LONG-TERM DEBT

7. LONG-TERM DEBT

2023 CoBank Credit Facility

On July 13, 2023, the Company, along with certain of its subsidiaries as guarantors, entered into a new Credit Agreement with CoBank, ACB and a syndicate of other lenders (as may be amended from time to time, the “2023 CoBank Credit Facility”).

The 2023 CoBank Credit Facility provides for a five-year $170 million revolving credit facility (the “2023 CoBank Revolving Loan”) and a six-year $130 million term loan facility (the “2023 CoBank Term Loan”). The Company may use (i) up to $25 million under the 2023 CoBank Credit Facility for letters of credit, and (ii) up to $20 million under a swingline sub-facility. Upon the closing of the 2023 CoBank Credit Facility, the Company drew all of the 2023 CoBank Term Loan and approximately $13.6 million of the 2023 CoBank Revolving Loan. These borrowings were used to repay $139.5 million of debt outstanding under the 2019 CoBank Credit Facility at close.

The 2023 CoBank Term Loan must be repaid in quarterly principal payments in the amounts set forth below, with the outstanding principal balance maturing on July 13, 2029. The 2023 CoBank Revolving Loan may be repaid at any time on or prior to its maturity on July 13, 2028. All amounts outstanding under the 2023 CoBank Credit Facility will be due and payable upon the earlier of the maturity date or the acceleration of the loans and commitments upon an event of default.


2023 CoBank Term Loan Quarterly Payment Dates	2023 CoBank Term Loan Quarterly Repayments
December 31, 2023 – June 30, 2025	$812,500 (2.5% per annum)
September 30, 2025 – June 30, 2026	$1,625,000 (5% per annum)
September 30, 2026 – June 30, 2029	$2,437,500 (7.5% per annum)

Amounts borrowed under the 2023 CoBank Credit Facility bear interest at a rate equal to, at the Company’s option, either (i) the secured overnight financing rate as administered by the Federal Reserve Bank of New York (SOFR) plus an applicable margin ranging between 2.00% to 3.75% for the 2023 CoBank Term Loan or 1.75% to 3.50% for Revolving Loans or (ii) a base rate plus an applicable margin ranging from 1.00% to 2.75% for the Term Loan or 0.75% to 2.50% for the 2023 CoBank Revolving Loans. Swingline loans will bear interest at the base rate plus the applicable margin for base rate loans. The base rate is equal to the higher of (i) 1.00% plus the one-month SOFR rate (ii) the federal funds effective rate (as defined in the 2023 CoBank Credit Agreement) plus 0.50% per annum; and (iii) the prime rate (as defined in the 2023 CoBank Credit Agreement). The applicable margin is determined based on the ratio (as further defined in the 2023 CoBank Credit Agreement) of the Company’s maximum Total Net Leverage Ratio. Under the terms of the 2023 CoBank Credit Agreement, the Company must also pay a fee ranging from 0.25% to 0.50% on the average daily unused portion of the 2023 CoBank Credit Facility over each calendar quarter.

The 2023 CoBank Credit Agreement contains a financial covenant (as further defined in the 2023 CoBank Credit Agreement) that imposes a maximum Total Net Leverage Ratio, as well as customary representations, warranties and covenants, including covenants limiting additional indebtedness, liens, guaranties, mergers and consolidations, substantial asset sales, investments and loans, sale and leasebacks, transactions with affiliates and fundamental changes. The maximum Total Net Leverage Ratio is measured each fiscal quarter and is required to be less than or equal to 3.25 to 1.0. The 2023 CoBank Credit Agreement provides for events of default customary for credit facilities of this type,

including but not limited to non-payment, defaults on other debt, misrepresentation, breach of covenants, representations and warranties, insolvency and bankruptcy.

The Company capitalized $4.2 million of fees associated with the 2023 CoBank Credit Facility which are being amortized over the life of the debt and $3.7 million were unamortized as of March 31, 2024.

The Company had $128.4 million outstanding under the 2023 CoBank Term Loan as of March 31, 2024. Under the 2023 CoBank Revolving Loan, the Company had $60.8 million outstanding and $109.2 million of availability as of March 31, 2024. The Company was in compliance with all financial covenants as of March 31, 2024.

In October 2023, the Company entered a two year, forward starting 1-month floating to fixed SOFR interest rate swap agreement. The swap was effective November 13, 2023 in a non-amortizing notional amount of $50.0 million, has a fixed SOFR rate of 4.896% and matures on November 13, 2025.

2019 CoBank Credit Facility

On April 10, 2019, the Company entered into a credit facility, with CoBank, ACB and a syndicate of other lenders (as amended, the “2019 CoBank Credit Facility”). The 2019 CoBank Credit Facility provided for a $200 million revolving credit facility that included (i) up to $75 million for standby or trade letters of credit and (ii) up to $10 million under a swingline sub-facility. In connection with the execution of the 2023 CoBank Credit Facility, as defined above, outstanding borrowings under the 2019 CoBank Credit Facility were repaid in full.

Amounts borrowed under the 2019 CoBank Credit Facility bore interest at a rate equal to, at the Company’s option, either (i) the London Interbank Offered Rate (“LIBOR”) plus an applicable margin ranging between 1.25% to 2.25% or (ii) a base rate plus an applicable margin ranging from 0.25% to 1.25%. Swingline loans bore interest at the base rate plus the applicable margin for base rate loans. The base rate was equal to the higher of (i) 1.00% plus the higher of (x) LIBOR for an interest period of one month and (y) LIBOR for an interest period of one week; (ii) the Federal Funds Effective Rate (as defined in the 2019 CoBank Credit Facility) plus 0.50% per annum; and (iii) the Prime Rate (as defined in the 2019 CoBank Credit Facility). The applicable margin was determined based on the Total Net Leverage Ratio (as defined in the 2019 CoBank Credit Facility). Under the terms of the 2019 CoBank Credit Facility, the Company also paid a commitment fee ranging from 0.150% to 0.375% of the average daily unused portion of the 2019 CoBank Credit Facility over each calendar quarter.

Letter of Credit Facility

On November 14, 2022, the Company entered into a General Agreement of Indemnity to issue performance Standby Letters of Credit on behalf of the Company and its subsidiaries. As of March 31, 2024, $32.4 million of Standby Letters of Credit had been issued under this agreement.

Alaska Credit Facility

On July 22, 2021, Alaska Communications entered into a Credit Agreement (the “Alaska Credit Facility”) with Fifth Third Bank, National Association, as Administrative Agent, and a syndicate of lenders to provide a $35.0 million revolving facility (the “Alaska Revolving Facility”) and a $210.0 million initial term loan facility (the “Alaska Term Loan”).

On December 23, 2022, Alaska Communications entered into a First Amendment Agreement (the “ACS Amendment”). The ACS Amendment amends the Alaska Credit Facility to increase its Revolving Credit Commitment from $35.0 million to $75.0 million and Term Loan Commitment from $210.0 million to $230.0 million. As a part of the transaction, the Term Loan commitment was fully funded as the outstanding Revolving Credit Commitment balance was transferred.

As of March 31, 2024, Alaska Communications had drawn $40.0 million on its Revolving Credit Commitment and had $35.0 million available to draw. The Term Loan balance was $227.1 million and principal payments commenced in the fourth quarter of 2023. Both facilities mature on July 22, 2026.

In addition to the above changes, the ACS Amendment replaced the calculation of interest from an applicable margin applied to LIBOR with the same applicable margin applied to the Secured Overnight Financing Rate (“SOFR”) plus a 10-basis point adjustment.

Alaska Communications capitalized $7.3 million of fees associated with the Alaska Credit Facility which are being amortized over the life of the debt and $3.5 million were unamortized as of March 31, 2024.

The Alaska Credit Facility also provides for incremental facilities up to an aggregate principal amount of the greater of $70.0 million and Alaska Communications’ trailing twelve-month Consolidated EBITDA (as defined in the Alaska Credit Facility).

The key terms and conditions of the Alaska Credit Facility include the following:

●

Amounts outstanding bear an interest rate of the forward-looking SOFR rate with a one-month interest period, plus the SOFR Spread Adjustment of 10 basis points, plus a margin ranging from 3.00% to 4.00% based on Alaska Communications’ Consolidated Total Net Leverage Ratio (as defined in the Credit Agreement) or an alternate base rate may be selected at a margin that is 1% lower than the counterpart SOFR margin;

●

Principal repayments are due quarterly and commenced in the fourth quarter of 2023 in amounts as follows: from the fourth quarter of 2023 through the third quarter of 2024, $1.4 million; and from the fourth quarter of 2024 through the third quarter of 2026, $2.9 million. The remaining unpaid balance is due on the final maturity date;

●

Alaska Communications is required to maintain financial ratios as defined in the Alaska Credit Facility, including (a) a maximum Consolidated Net Total Leverage Ratio of 4.00 to 1, stepping down to 3.75 to 1 beginning with the second quarter of 2024; and (b) a minimum Consolidated Fixed Charge Coverage Ratio of not less than 1.25 to 1; and

●

The Alaska Credit Facility is non-recourse to the Company and is secured by substantially all of the personal property and certain material real property owned by Alaska Communications.

Alaska Communication’s interest rate swap, which had been designated as a cash flow hedge with an interest rate of 1.6735%, expired on June 30, 2022. In November 2023, Alaska Communications entered two forward starting 1-month floating to fixed SOFR interest rate swap agreements. The total non-amortizing notional amount of the agreements is $200.0 million, with fixed SOFR rates of 4.8695% and 4.8980% and both agreements mature on June 30, 2025.

Alaska Term Facility

On June 15, 2022, Alaska Communications Systems Holdings, the parent company of Alaska Communications, entered into a secured lending arrangement with Bristol Bay Industrial, LLC (the “Alaska Term Facility”).

The Alaska Term Facility provided for a secured delayed draw term loan in an aggregate principal amount of up to $7.5 million and the proceeds were used to pay certain invoices from a contractor for work performed in connection

with a fiber build. Interest on the Alaska Term Facility accrues at a fixed rate of 4.0% and scheduled quarterly payments of principal commenced on March 31, 2023. The Alaska Term Facility matures on June 30, 2024.

The Alaska Term Facility contains events of default customary for facilities of this type.

As of March 31, 2024, Alaska Communications Systems Holdings had $5.3 million outstanding and no available borrowings under the Alaska Term Facility.

FirstNet Receivables Credit Facility

On March 26, 2020, Commnet Finance, a wholly owned subsidiary of Commnet Wireless, entered into a receivables credit facility with the Company, Commnet Wireless, and CoBank, ACB (the “Receivables Credit Facility”).

The Receivables Credit Facility provides for a senior secured delayed draw term loan in an aggregate principal amount of up to $75.0 million and the proceeds may be used to acquire certain receivables from Commnet Wireless. The receivables to be financed and sold under the Receivables Credit Facility, which provide the loan security, relate to the obligations of AT&T under the FirstNet Agreement.

On December 19, 2023, CoBank amended the Receivables Credit Facility and extended the delayed draw period to December 31, 2024.

The maturity date for each loan will be set by CoBank and will match the weighted average maturity of the certain receivables financed.

Interest on the loans accrue at a fixed annual interest rate to be quoted by CoBank.

The Receivables Credit Facility contains customary events of termination, representations and warranties, affirmative and negative covenants and events of default customary for facilities of this type.

As of March 31, 2024, Commnet Wireless had $48.4 million outstanding, of which $7.6 million was current, and $11.3 million of availability under the Receivables Credit Facility. Commnet Wireless capitalized $0.8 million in fees associated with the Receivables Credit Facility which are being amortized over the life of the debt and $0.5 million were unamortized as of March 31, 2024.

GTT Credit Facilities

On October 12, 2022, GTT received approval from Republic Bank (Guyana) Limited for a $2.9 million term facility and a $5.7 million overdraft facility (the “GTT Credit Facilities”) subject to the approval from the Minister of Finance at the Bank of Guyana, which was received on March 31, 2023.

The GTT Credit Facilities are secured by real estate assets and carry a fixed interest rate of 7.5% which will be reviewed by the bank from time to time and subject to change at the bank’s discretion. The term facility is repayable over five years in equal monthly installments of principal and interest, commencing one month after funds are advanced. The overdraft facility will expire on October 31, 2024.

As of March 31, 2024, there were no outstanding amounts under the GTT Credit Facilities.

Sacred Wind Term Debt

In connection with the Sacred Wind acquisition completed on November 7, 2022, the Company assumed $31.6 million of term debt (the “Sacred Wind Term Debt”) with the United States of America acting through the Administrator of the Rural Utilities Service (“RUS”). The loan agreements are dated as of October 23, 2006 and March 17, 2016. RUS provides financial assistance in the form of loans under the Rural Electrification Act of 1936 to furnish or improve telecommunications and/or broadband services in rural areas.

The Sacred Wind Term Debt is secured by substantially all assets of Sacred Wind and an underlying mortgage to the United States of America. These mortgage notes are to be repaid in equal monthly installments covering principal and interest beginning after date of issue and expiring by 2035.

The Sacred Wind Term Debt contains certain restrictions on the declaration or payment of dividends, redemption of capital stock or investment in affiliated companies without the consent by the RUS noteholders. The agreements also contain a financial covenant which Sacred Wind was not in compliance with as of December 31, 2021. Sacred Wind submitted a corrective action plan to comply with the financial covenant as of December 31, 2025. On May 5, 2022, Sacred Wind’s corrective action plan was accepted by the RUS. As of March 31, 2024, Sacred Wind was in compliance with that corrective action plan.

As of March 31, 2024, $27.4 million was outstanding under the Sacred Wind Term Debt. Of that amount, $3.3 million was current and $24.1 million was long term.

The mortgage notes carry fixed interest rates ranging from 0.88% to 5.0%.

Viya Debt

The Company, and certain of its subsidiaries, have entered into a $60.0 million loan agreement (the “Viya Debt”) with Rural Telephone Finance Cooperative (“RTFC”). The Viya Debt agreement contains customary representations, warranties, and affirmative and negative covenants (including limitations on additional debt, guaranties, sale of assets and liens) and a financial covenant that limits the maximum ratio of indebtedness to annual operating cash flow to 3.5 to 1.0 (the “Net Leverage Ratio”). This covenant is tested on an annual basis at the end of each fiscal year. Interest is paid quarterly at a fixed rate of 4.0% per annum and principal repayment is not required until maturity on July 1, 2026. Prepayment of the Viya Debt may be subject to a fee under certain circumstances. The debt is secured by certain assets of the Viya subsidiaries and is guaranteed by the Company.

The Company paid a fee of $0.9 million in 2016 to lock the interest rate at 4% per annum over the term of the Viya Debt. The fee was recorded as a reduction to the Viya Debt carrying amount and is being amortized over the life of the loan.

As of March 31, 2024, $60.0 million of the Viya Debt remained outstanding and $0.2 million of the rate lock fee was unamortized.

On May 5, 2022, RTFC agreed to amend the Net Leverage Ratio to 7.0 to 1.0 through the maturity date of July 1, 2026. The Ratio is tested annually, and Viya was in compliance with the Net Leverage Ratio as of December 31, 2023.

Debt Maturity

The table below summarizes the annual maturities of the Company’s debt instruments (amounts in thousands).


									Customer
	US		International		Corporate and		Total		Receivable
Amounts Maturing During	Telecom		Telecom		Other		Debt		Credit Facility
April 1, 2024 through December 31, 2024	$	13,549	$	—	$	2,438	$	15,987	$	5,644
Year ending December 31, 2025		14,969		—		4,875		19,844		7,830
Year ending December 31, 2026		253,469		60,000		8,125		321,594		8,192
Year ending December 31, 2027		3,723		—		9,750		13,473		8,572
Year ending December 31, 2028		3,858		—		9,750		13,608		8,973
Thereafter		10,192		—		154,257		164,449		9,221
Total		299,760		60,000		189,195		548,955		48,432
Debt Discounts		(3,764)		(224)		(3,676)		(7,664)		(455)
Book Value as of March 31, 2024	$	295,996	$	59,776	$	185,519	$	541,291	$	47,977

ORGANIZATION AND BUSINESS OPERATIONS - Restructuring Expenses (Details) - USD ($) $ in Thousands	3 Months Ended		15 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Mar. 31, 2024
Restructuring Expense
Restructuring charge	$ 1,190	$ 2,887	$ 12,418
Employee termination benefits			6,641
Contract termination costs			5,777
Restructure costs paid	2,000
Total restructure costs paid			7,700
Gain on lease termination		300	300
Restructuring costs remain accrued	5,000		5,000
Right of use assets terminated	5,600	5,000	5,600
Lease liabilities terminated	$ 5,900	$ 5,300	5,900
US Telecom
Restructuring Expense
Restructuring charge			7,737
Employee termination benefits			1,960
Contract termination costs			5,777
International Telecom
Restructuring Expense
Restructuring charge			4,681
Employee termination benefits			$ 4,681

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions	Mar. 31, 2024	Dec. 31, 2023
CONDENSED CONSOLIDATED BALANCE SHEETS
Accounts receivable, allowances	$ 16.9	$ 16.4
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	17,845,445	17,702,476
Common stock, shares outstanding	15,501,510	15,421,481
Treasury stock, shares	2,343,935	2,280,995

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Foreign currency translation adjustment, tax expense	$ 0.0	$ 0.0
Reclassification of loss on pension settlement, net of tax	0.0	0.0
Unrealized gain on derivatives net of tax expense	$ 0.5	$ 0.0

FAIR VALUE MEASUREMENTS AND INVESTMENTS

3 Months Ended

Mar. 31, 2024

FAIR VALUE MEASUREMENTS AND INVESTMENTS

FAIR VALUE MEASUREMENTS AND INVESTMENTS

6. FAIR VALUE MEASUREMENTS AND INVESTMENTS

In accordance with the provisions of fair value accounting, a fair value measurement assumes that a transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability, and defines fair value based upon an exit price model.

The fair value measurement guidance establishes a 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 guidance describes three levels of inputs that may be used to measure fair value:


Level 1		Quoted prices in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset and liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 assets and liabilities include money market funds, debt and equity securities and derivative contracts that are traded in an active exchange market.

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 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments and derivative contracts whose value is determined using a pricing model with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. This category generally includes corporate obligations and non-exchange traded derivative contracts.


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. Level 3 assets and liabilities include financial instruments and intangible assets that have been impaired whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

Assets and liabilities of the Company measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023 are summarized as follows (in thousands):


	March 31, 2024
	Significant Other
	Quoted Prices in		Unobservable
	Active Markets		Inputs
Description	(Level 1)		(Level 3)		Total
Short term investments	$	300	$	—	$	300
Other investments		—		1,076		1,076
Employee benefit plan investments		2,991		—		2,991
Alaska Communications redeemable common units		—		(8,419)		(8,419)
Alloy redeemable common units		—		(14,760)		(14,760)
Warrants on Alaska Communications redeemable common units		—		(249)		(249)
Total assets and liabilities measured at fair value	$	3,291	$	(22,352)	$	(19,061)


	December 31, 2023
	Significant Other
	Quoted Prices in		Unobservable
	Active Markets		Inputs
Description	(Level 1)		(Level 3)		Total
Short term investments	$	300	$	—	$	300
Other investments		—		1,197		1,197
Employee benefit plan investments		3,014		—		3,014
Alaska Communications redeemable common units		—		(11,063)		(11,063)
Alloy redeemable common units		—		(14,760)		(14,760)
Warrants on Alaska Communications redeemable common units		—		(249)		(249)
Total assets and liabilities measured at fair value	$	3,314	$	(24,875)	$	(21,561)

Other Investments

The Company holds investments in equity securities consisting of noncontrolling investments in privately held companies. The investments are accounted for using equity method accounting, the measurement alternative for investments without a readily determinable fair value, or fair value. The fair value investments are valued using Level 3 inputs and the Company used the income approach to fair value the investment. The inputs consisted of a discount rate and future cash flows calculated based on the investment attributes. A roll forward of the investments is below (in thousands):




	Investments without a readily determinable fair value		Fair value investments		Equity method investments		Total
Balance, December 31, 2023	$	41,710	$	1,197	$	—	$	42,907
Income recognized		—		19		—		19
Contributions / (distributions)		—		(140)		—		(140)
Foreign currency gain		—		—		—		—
Reclassification of foreign currency losses		—		—		—		—
Transfers		—		—		—		—
Balance, March 31, 2024	$	41,710	$	1,076	$	—	$	42,786

Balance, December 31, 2022	$	22,590	$	1,616	$	13,963	$	38,169
Income recognized		—		77		238		315
Contributions / (distributions)		—		—		630		630
Foreign currency loss		—		—		111		111
Balance, March 31, 2023	$	22,590	$	1,693	$	14,942	$	39,225

During the year ended December 31, 2023, the Company lost the ability to exert significant influence over its India solar investment. As a result, the Company transferred $16.3 million from equity method investments to investments without a readily determinable fair value and the accounting for the investment changed to the cost method from the equity method of accounting.

These investments are included with other assets on the consolidated balance sheets.

Redeemable Common Units and Warrants

The Company has issued redeemable common units, and warrants to purchase additional common units, in consolidated subsidiaries of the Company. The instruments are redeemable at the option of the holder. Both the common units and warrants to purchase common units are recorded at fair value in the Company’s financial statements. The common units are recorded in redeemable noncontrolling interest and the warrants are recorded in other liabilities on the Company’s balance sheets. The put options for the Alloy redeemable common units begin in November 2026. The put options for the Alaska Communications redeemable common units begin the earlier of a public offering or July 2028. The Company calculates the fair value of the instruments using a combination of market and discounted cash flows approaches with Level 3 inputs.

Other Fair Value Disclosures

The carrying amounts of cash and cash equivalents, accounts receivable, and accounts payable and accrued expenses approximate their fair values because of the relatively short-term maturities of these financial instruments.

The fair value of long-term debt is estimated using Level 2 inputs. At March 31, 2024, the fair value of long-term debt, including the current portion, was $597.4 million and its book value was $589.3 million. At December 31, 2023, the fair value of long-term debt, including the current portion, was $571.6 million and its book value was $562.9 million.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.