AMERICAN TOWER CORP MA

Previous wording

The divestiture qualified for presentation as discontinued operations. See note 15 to our consolidated and condensed consolidated financial statements included in this Quarterly Report (“Note 15”) for further discussion. Prior to the divestiture and classification as discontinued operations, ATC TIPL’s operating results were included within the Asia-Pacific property segment. Historical financial information included in Management’s Discussion and Analysis of Financial Condition and Results of Operations has been adjusted to reflect the operating results of ATC TIPL as discontinued operations for all periods presented.

Current wording

In 2023, we initiated a strategic review of our India business, as further discussed below under “Results of Operations—Income from Discontinued Operations, Net of Taxes.” The strategic review concluded in January 2024 with the signed agreement for the ATC TIPL Transaction. The ATC TIPL Transaction received all government and regulatory approvals during the three months ended September 30, 2024. On September 12, 2024, we completed the ATC TIPL Transaction and received total consideration of 182 billion INR (approximately $2.2 billion). ATC TIPL’s operating results are presented as discontinued operations. See discussion below and note 15 to our consolidated and condensed consolidated financial statements included in this Quarterly Report (“Note 15”) for further discussion. Historical financial information included in Management’s Discussion and Analysis of Financial Condition and Results of Operations has been adjusted to reflect the operating results of ATC TIPL as discontinued operations for all periods presented.

Previous wording

We are one of the largest global real estate investment trusts and a leading independent owner, operator and developer of multitenant communications real estate. Our primary business is the leasing of space on communications sites to wireless service providers, radio and television broadcast companies, wireless data providers, government agencies and municipalities and tenants in a number of other industries. In addition to the communications sites in our portfolio, we manage rooftop and tower sites for property owners under various contractual arrangements. We also hold other telecommunications infrastructure and property interests that we lease primarily to communications service providers and third-party tower operators, and, as discussed further below, we hold a portfolio of highly interconnected data center facilities and related assets in the United States. Our customers include our tenants, licensees and other payers. We refer to the business encompassing the above as our property operations, which accounted for 98% of our total revenues for each of the three and nine months ended September 30, 2024 and includes our U.S. & Canada property, Asia-Pacific property, Africa property, Europe property and Latin America property segments and Data Centers segment.

Current wording

We are one of the largest global real estate investment trusts and a leading independent owner, operator and developer of multitenant communications real estate. Our primary business is the leasing of space on communications sites to wireless service providers, radio and television broadcast companies, wireless data providers, government agencies and municipalities and tenants in a number of other industries. In addition to the communications sites in our portfolio, we manage rooftop and tower sites for property owners under various contractual arrangements. We also hold other telecommunications infrastructure and property interests that we lease primarily to communications service providers and third-party tower operators, and, as discussed further below, we hold a portfolio of highly interconnected data center facilities and related assets in the United States. Our customers include our tenants, licensees and other payers. We refer to the business encompassing the above as our property operations, which accounted for 97% of our total revenues for the three months ended March 31, 2025 and includes our U.S. & Canada property, Africa & APAC property, Europe property and Latin America property segments and Data Centers segment.

Previous wording

As of September 30, 2024, our property portfolio included 28 operating data center facilities across ten markets in the United States that collectively comprise approximately 3.2 million net rentable square feet (“NRSF”) of data center space, as follows:

Current wording

As of March 31, 2025, our property portfolio included 30 operating data center facilities across 11 markets in the United States that collectively comprise approximately 3.4 million net rentable square feet (“NRSF”) of data center space, as follows:

Previous wording

We operate in seven reportable segments: U.S. & Canada property, Asia-Pacific property, Africa property, Europe property, Latin America property, Data Centers and Services. In evaluating operating performance in each business segment, management uses, among other factors, segment gross margin and segment operating profit (see note 14 to our consolidated and condensed consolidated financial statements included in this Quarterly Report).

Current wording

We operate in six reportable segments: U.S. & Canada property, Africa & APAC property, Europe property, Latin America property, Data Centers and Services. In evaluating operating performance in each business segment, management uses, among other factors, segment gross margin and segment operating profit (see note 14 to our consolidated and condensed consolidated financial statements included in this Quarterly Report).

Previous wording

In most of our markets, our tenant leases for our communications sites with wireless carriers generally have initial non-cancellable terms of five to ten years with multiple renewal terms. Accordingly, the vast majority of the revenue generated by our property operations during the nine months ended September 30, 2024 was recurring revenue that we should continue to receive in future periods. Most of our tenant leases for our communications sites have provisions that periodically increase or “escalate” the rent due under the lease, typically based on (a) an annual fixed escalation (averaging approximately 3% in the United States), (b) an inflationary index in most of our international markets, or (c) a combination of both. In addition, certain of our tenant leases provide for additional revenue primarily to cover costs (pass-through revenue), such as ground rent or power and fuel costs.

Current wording

In most of our markets, our tenant leases for our communications sites with wireless carriers generally have initial non-cancellable terms of five to ten years with multiple renewal terms. Accordingly, the vast majority of the revenue generated by our property operations during the three months ended March 31, 2025 was recurring revenue that we should continue to receive in future periods. Most of our tenant leases for our communications sites have provisions that periodically increase or “escalate” the rent due under the lease, typically based on (a) an annual fixed escalation (averaging approximately 3% in the United States), (b) an inflationary index in most of our international markets, or (c) a combination of both. In addition, certain of our tenant leases provide for additional revenue primarily to cover costs (pass-through revenue), such as ground rent or power and fuel costs.

Previous wording

Based upon existing customer leases and foreign currency exchange rates as of September 30, 2024, we expect to generate nearly $55 billion of non-cancellable customer lease revenue over future periods, before the impact of straight-line lease accounting.

Current wording

Based upon existing customer leases and foreign currency exchange rates as of March 31, 2025, we expect to generate over $55 billion of non-cancellable customer lease revenue over future periods, before the impact of straight-line lease accounting.

Previous wording

The revenues generated by our property operations may be affected by cancellations of existing tenant leases. As discussed above, most of our tenant leases with wireless carriers and broadcasters are multiyear contracts, which typically are non-cancellable; however, in some instances, a lease may be cancelled upon the payment of a termination fee. Revenue lost from either tenant lease cancellations or the non-renewal of leases or rent renegotiations, which we refer to as churn, has historically not had a material adverse effect on the revenues generated by our consolidated property operations. During the nine months ended September 30, 2024, churn was approximately 2% of our tenant billings, primarily driven by churn in our U.S. & Canada property segment, as discussed below.

Current wording

The revenues generated by our property operations may be affected by cancellations of existing tenant leases. As discussed above, most of our tenant leases with wireless carriers and broadcasters are multiyear contracts, which typically are non-cancellable; however, in some instances, a lease may be cancelled upon the payment of a termination fee. Revenue lost from either tenant lease cancellations or the non-renewal of leases or rent renegotiations, which we refer to as churn, has historically not had a material adverse effect on the revenues generated by our consolidated property operations. During the three months ended March 31, 2025, churn was approximately 2% of our tenant billings, primarily driven by churn in our U.S. & Canada property segment, as discussed below.

Previous wording

Included in our analysis of our results of operations are discussions regarding earnings before interest, taxes, depreciation, amortization and accretion, as adjusted (“Adjusted EBITDA”), Funds From Operations, as defined by the National Association of Real Estate Investment Trusts (“Nareit FFO”) attributable to American Tower Corporation common stockholders and Adjusted Funds From Operations (“AFFO”) attributable to American Tower Corporation common stockholders (“AFFO attributable to American Tower Corporation common stockholders”).

Current wording

Included in our analysis of our results of operations are discussions regarding earnings before interest, taxes, depreciation, amortization and accretion, as adjusted (“Adjusted EBITDA”), Funds From Operations, as defined by the National Association of Real Estate Investment Trusts (“Nareit FFO”) attributable to American Tower Corporation common stockholders, Adjusted Funds From Operations (“AFFO”) attributable to American Tower Corporation common stockholders (“AFFO attributable to American Tower Corporation common stockholders”) and Segment gross margin.

Previous wording

Nareit FFO attributable to American Tower Corporation common stockholders is defined as net income before gains or losses from the sale or disposal of real estate, real estate related impairment charges, real estate related depreciation, amortization and accretion including adjustments and distributions for unconsolidated affiliates and noncontrolling interests and discontinued operations. In this section, we refer to Nareit FFO attributable to American Tower Corporation common stockholders as “Nareit FFO (common stockholders).”

Current wording

Nareit FFO attributable to American Tower Corporation common stockholders is defined as net income before gains or losses from the sale or disposal of real estate, real estate related impairment charges, real estate related depreciation, amortization and accretion including adjustments and distributions for unconsolidated affiliates and noncontrolling interests and adjustments for discontinued operations. In this section, we refer to Nareit FFO attributable to American Tower Corporation common stockholders as “Nareit FFO (common stockholders).”

Previous wording

Adjusted EBITDA, Nareit FFO (common stockholders) and AFFO (common stockholders) are not intended to replace net income or any other performance measures determined in accordance with GAAP. None of Adjusted EBITDA, Nareit FFO (common stockholders) or AFFO (common stockholders) represents cash flows from operating activities in accordance with GAAP and, therefore, these measures should not be considered indicative of cash flows from operating activities, as a measure of liquidity or a measure of funds available to fund our cash needs, including our ability to make cash distributions. Rather, Adjusted EBITDA, Nareit FFO (common stockholders) and AFFO (common stockholders) are presented as we believe each is a useful indicator of our current operating performance. We believe that these metrics are useful to an investor in evaluating our operating performance because (1) each is a key measure used by our management team for decision making purposes and for evaluating our operating segments’ performance; (2) Adjusted EBITDA is a component underlying our credit ratings; (3) Adjusted EBITDA is widely used in the telecommunications real estate sector to measure operating performance as depreciation, amortization and accretion may vary significantly among companies depending upon accounting methods and useful lives, particularly where acquisitions and non-operating factors are involved; (4) AFFO (common stockholders) is widely used in the telecommunications real estate sector to adjust Nareit FFO (common stockholders) for items that may otherwise cause material fluctuations in Nareit FFO (common stockholders) growth from period to period that would not be representative of the underlying performance of property assets in those periods; (5) each provides investors with a meaningful measure for evaluating our period-to-period operating performance by eliminating items that are not operational in nature; and (6) each provides investors with a measure for comparing our results of operations to those of other companies, particularly those in our industry.

Current wording

Adjusted EBITDA, Nareit FFO (common stockholders), AFFO (common stockholders) and Segment gross margin are not intended to replace net income or any other performance measures determined in accordance with GAAP. None of Adjusted EBITDA, Nareit FFO (common stockholders), AFFO (common stockholders) or Segment gross margin represents cash flows from operating activities in accordance with GAAP and, therefore, these measures should not be considered indicative of cash flows from operating activities, as a measure of liquidity or a measure of funds available to fund our cash needs, including our ability to make cash distributions. Rather, Adjusted EBITDA, Nareit FFO (common stockholders), AFFO (common stockholders) and Segment gross margin are presented as we believe each is a useful indicator of our current operating performance. We believe that these metrics are useful to an investor in evaluating our operating performance because (1) each is a key measure used by our management team for decision making purposes and for evaluating our operating segments’ performance; (2) Adjusted EBITDA is a component underlying our credit ratings; (3) Adjusted EBITDA is widely used in the telecommunications real estate sector to measure operating performance as depreciation, amortization and accretion may vary significantly among companies depending upon accounting methods and useful lives, particularly where acquisitions and non-operating factors are involved; (4) AFFO

Previous wording

Our measurement of Adjusted EBITDA, Nareit FFO (common stockholders) and AFFO (common stockholders) may not, however, be fully comparable to similarly titled measures used by other companies. Reconciliations of Adjusted EBITDA, Nareit FFO (common stockholders) and AFFO (common stockholders) to net income, the most directly comparable GAAP measure, have been included below.

Current wording

Our measurement of Adjusted EBITDA, Nareit FFO (common stockholders), AFFO (common stockholders) and Segment gross margin may not, however, be fully comparable to similarly titled measures used by other companies. Reconciliations of Adjusted EBITDA, Nareit FFO (common stockholders) and AFFO (common stockholders) to net income and Segment gross margin to gross margin, the most directly comparable GAAP measures, have been included below.

Previous wording

The ATC TIPL Transaction received all government and regulatory approvals during the three months ended September 30, 2024, and on September 12, 2024, we completed the sale of ATC TIPL and received total consideration of 182 billion INR (approximately $2.2 billion). We used the proceeds from the ATC TIPL Transaction to repay existing indebtedness under our $6.0 billion senior unsecured multicurrency revolving credit facility, as amended and restated in December 2021, as further amended (the “2021 Multicurrency Credit Facility”). We recorded a loss on the sale of ATC TIPL of $1.2 billion, which primarily included the reclassification of our cumulative translation adjustment in India upon exiting the market of $1.1 billion. The loss on sale of ATC TIPL is included in Loss from discontinued operations, net of taxes in the consolidated statements of operations for the three and nine months ended September 30, 2024.

Current wording

Three Months Ended March 31, 2025 and 2024

Previous wording

Europe property segment revenue growth of $12.4 million was attributable to:

Current wording

U.S. & Canada property segment revenue decrease of $12.4 million was attributable to:

Previous wording

•A decrease of $63.5 million in other revenue, primarily due to equipment removal and other fees received in the prior year period, and a $32.1 million decrease due to straight-line accounting;

Current wording

•A decrease of $56.5 million in other revenue, primarily due to a decrease of $56.7 million due to straight-line accounting;

Previous wording

•Partially offset by tenant billings growth of $57.0 million, which was driven by:

Current wording

•Partially offset by tenant billings growth of $44.3 million, which was driven by:

Previous wording

•$44.9 million due to leasing additional space on our sites (“colocations”) and amendments; and

Current wording

•$38.0 million due to leasing additional space on our sites (“colocations”) and amendments;

Previous wording

•$0.6 million generated from sites acquired or constructed since the beginning of the prior-year period (“newly acquired or constructed sites”);

Current wording

•$1.0 million generated from sites acquired or constructed since the beginning of the prior-year period (“newly acquired or constructed sites”);

Previous wording

Segment revenue growth was partially offset by a decrease of $0.2 million attributable to the negative impact of foreign currency translation related to fluctuations in Bangladeshi Taka (“BDT”) and Philippine Peso (“PHP”).

Current wording

Segment revenue growth was partially offset by a decrease of $0.2 million attributable to the negative impact of foreign currency translation related to fluctuations in Canadian Dollar.

Previous wording

•$10.0 million generated from newly acquired or constructed sites; and

Current wording

•$6.6 million generated from newly acquired or constructed sites; and

Previous wording

◦$2.6 million from churn in excess of contractual escalations; and

Current wording

•$2.6 million from other tenant billings;

Previous wording

Segment revenue growth included an increase of $1.6 million attributable to the positive impact of foreign currency translation related to fluctuations in Euro (“EUR”).

Current wording

Segment revenue growth was partially offset by a decrease of $7.4 million attributable to the negative impact of foreign currency translation related to fluctuations in Euro (“EUR”).

Previous wording

•A decrease of $42.1 million attributable to the impact of foreign currency translation, which included, among others, negative impacts of $25.4 million related to fluctuations in Brazilian Real (“BRL”), $13.7 million related to fluctuations in Mexican Peso (“MXN”) and $2.5 million related to fluctuations in Chilean Peso (“CLP”); and

Current wording

•A decrease of $58.8 million, attributable to the impact of foreign currency translation, which included, among others, negative impacts of $31.5 million related to fluctuations in Brazilian Real, $25.0 million related to fluctuations in Mexican Peso and $2.2 million related to fluctuations in Colombian Peso;

Previous wording

•Partially offset by a decrease of $0.8 million from other tenant billings; and

Current wording

•Partially offset by a decrease of $0.8 million from other tenant billings;

Previous wording

•An increase of $13.7 million in rental, related and other revenue, primarily due to new lease commencements, customer expansions and rent increases upon customer renewals;

Current wording

•An increase of $12.9 million in rental, related and other revenue, primarily due to new lease commencements, customer expansions and rent increases upon customer renewals;

Previous wording

•An increase of $7.7 million in power revenue from new lease commencements, increased power consumption and pricing increases from existing customers; and

Current wording

•An increase of $6.4 million in power revenue from new lease commencements, increased power consumption and pricing increases from existing customers; and

Previous wording

•An increase of $2.8 million in interconnection revenue, primarily due to customer interconnection net additions and set-up fees;

Current wording

•An increase of $3.4 million in interconnection revenue, primarily due to customer interconnection net additions and pricing increases from existing cross connects;

Previous wording

•Partially offset by a decrease of $2.4 million in straight-line revenue.

Current wording

•Partially offset by a decrease of $3.2 million in straight-line revenue.

Previous wording

Services segment revenue growth of $26.2 million was primarily attributable to an increase in construction management services, site application, zoning and permitting services and structural and mount analyses services.

Current wording

Services segment revenue growth of $44.4 million was primarily attributable to an increase in site application, zoning and permitting services, construction management services and structural and mount analyses services.

Previous wording

•The decrease in U.S. & Canada property segment gross margin was primarily attributable to the decrease in revenue described above and an increase in direct expenses of $10.6 million, primarily due to impacts of straight-line accounting.

Current wording

•The decrease in U.S. & Canada property segment gross margin was primarily attributable to the decrease in revenue described above, partially offset by a decrease in direct expenses of $2.0 million.

Previous wording

•The increase in Africa property segment gross margin was primarily attributable to the increase in revenue described above, partially offset by an increase in direct expenses of $4.6 million, primarily due to increases in repair and maintenance spending. Direct expenses also benefited by $8.3 million from the impact of foreign currency translation.

Current wording

•The increase in Africa & APAC property segment gross margin was primarily attributable to the increase in revenue described above, partially offset by an increase in direct expenses of $7.2 million, primarily due to an increase in repair and maintenance spending. Direct expenses also benefited by $1.9 million from the impact of foreign currency translation.

Previous wording

•The increase in Europe property segment gross margin was primarily attributable to the increase in revenue described above and a decrease in direct expenses of $0.1 million. Direct expenses were also negatively impacted by $0.5 million from the impact of foreign currency translation.

Current wording

•The increase in Europe property segment gross margin was primarily attributable to the increase in revenue described above, partially offset by an increase in direct expenses of $5.1 million, primarily due to an increase in land rent costs. Direct expenses also benefited by $2.6 million from the impact of foreign currency translation.

Previous wording

•The decrease in Latin America property segment gross margin was primarily attributable to the decrease in revenue described above, partially offset by a decrease in direct expenses of $3.3 million. Direct expenses also benefited by $12.8 million from the impact of foreign currency translation.

Current wording

•The decrease in Latin America property segment gross margin was primarily attributable to the decrease in revenue described above, partially offset by a decrease in direct expenses of $0.7 million. Direct expenses also benefited by $16.9 million from the impact of foreign currency translation.

Previous wording

•The increase in Data Centers segment gross margin was primarily attributable to the increase in revenue described above, partially offset by an increase in direct expenses of $10.1 million, primarily due to an increase in costs associated with power revenue, including utility costs.

Current wording

•The increase in Data Centers segment gross margin was primarily attributable to the increase in revenue described above, partially offset by an increase in direct expenses of $6.4 million, primarily due to an increase in costs associated with power revenue, including utility costs.

Previous wording

•The increase in Services segment gross margin was primarily attributable to the increase in revenue described above, partially offset by an increase in direct expenses of $12.4 million.

Current wording

•The increase in Services segment gross margin was primarily attributable to the increase in revenue described above, partially offset by an increase in direct expenses of $21.0 million.

Previous wording

•The increase in our Europe property segment SG&A was primarily driven by increased personnel and related costs to support our business, partially offset by decreased professional services costs.

Current wording

•The increase in our U.S. & Canada property segment SG&A was primarily driven by a net increase in bad debt expense and increased personnel and related costs to support our business, partially offset by decreased professional services costs and lower canceled construction costs.

Previous wording

•The increase in our Data Centers property segment SG&A was primarily driven by increased personnel and related costs to support our business and increased professional services costs.

Current wording

•The increases in our Africa & APAC property and Data Centers segment SG&A were primarily driven by increased personnel and related costs to support our business and increased professional services costs.

Previous wording

•The decrease in our Latin America property segment SG&A was primarily driven by decreased professional services costs and personnel and related costs and a benefit from the impact of foreign currency translation, partially offset by a net increase in bad debt expense of $4.9 million.

Current wording

•The decrease in our Latin America property segment SG&A was primarily driven by a net decrease in bad debt expense of $4.3 million, decreased personnel and related costs and a benefit from the impact of foreign currency translation, partially offset by increased professional services costs.

Previous wording

•The decrease in our Services segment SG&A was primarily driven by decreased personnel and related costs.

Current wording

•The increase in our Services segment SG&A was primarily driven by increased personnel and related costs to support our business.

Previous wording

•The increase in other SG&A was primarily attributable to an increase in stock-based compensation expense.

Current wording

•The decrease in other SG&A was primarily attributable to a decrease in stock-based compensation expense of $9.4 million, primarily driven by the reversal of previously recognized stock-based compensation expense associated with awards forfeited in connection with the departure of our Executive Vice President and President, APAC due to such role being eliminated, as discussed in note 9 to our consolidated and condensed consolidated financial statements included in this Quarterly Report.

Previous wording

•The decrease in operating profit for the three months ended September 30, 2024 for our U.S. & Canada property segment was primarily attributable to a decrease in our segment gross margin and an increase in our segment SG&A. The increase in operating profit for the nine months ended September 30, 2024 for our U.S. & Canada property segment was primarily attributable to an increase in our segment gross margin and a decrease in our segment SG&A.

Current wording

•The decrease in operating profit for the three months ended March 31, 2025 for our U.S. & Canada property segment was primarily attributable to a decrease in our segment gross margin and an increase in our segment SG&A.