Liberty Broadband Corporation (LBRDK): Business Model Canvas [11-2024 Updated]

Liberty Broadband Corporation (LBRDK) operates within the dynamic telecommunications landscape, leveraging its strategic partnerships and diverse service offerings to deliver reliable connectivity. With a strong focus on investment management and operational oversight, LBRDK has positioned itself to capitalize on growth opportunities in both residential and business segments. Dive deeper into the intricacies of their business model canvas to uncover how they sustain their competitive edge and drive customer satisfaction.

Liberty Broadband Corporation (LBRDK) - Business Model: Key Partnerships

Charter Communications as a major affiliate

Liberty Broadband Corporation holds an approximate 32.0% economic ownership interest in Charter Communications as of September 30, 2024. The carrying value of this investment is approximately $12.8 billion, while the market value is around $14.8 billion. During the nine months ended September 30, 2024, Liberty Broadband sold 698,011 shares of Charter Class A common stock to Charter for $226 million to maintain its fully diluted ownership percentage at 26%.

GCI Holdings for data and wireless services

GCI Holdings, a wholly-owned subsidiary of Liberty Broadband, provides a wide range of services including data, wireless, video, voice, and managed services primarily in Alaska. For the nine months ended September 30, 2024, GCI Holdings reported revenues of $753 million, an increase of $22 million from $731 million in the previous year. GCI Holdings' operating income for the same period was $109 million, up from $91 million in the previous year.

Revenue Source	Three Months Ended September 30, 2024 (in millions)	Three Months Ended September 30, 2023 (in millions)	Nine Months Ended September 30, 2024 (in millions)	Nine Months Ended September 30, 2023 (in millions)
Consumer Data	$59	$57	$179	$175
Wireless	$47	$47	$141	$142
Business Data	$125	$105	$342	$317
Total Revenue	$262	$240	$753	$731

Strategic alliances with technology providers

Liberty Broadband maintains strategic alliances with various technology providers to enhance its service offerings. These alliances focus on improving the technological backbone for GCI Holdings and Charter Communications. As of September 30, 2024, Liberty Broadband had capital expenditures of $183 million. This investment supports the enhancement of infrastructure and technology integration, critical for maintaining competitive advantages in data and wireless services.

Liberty Broadband Corporation (LBRDK) - Business Model: Key Activities

Investment management in telecommunications

Liberty Broadband Corporation engages in significant investment management activities, primarily focusing on its stake in Charter Communications. As of September 30, 2024, the carrying value of Liberty Broadband's investment in Charter was approximately $12.8 billion, while the market value stood at approximately $14.8 billion. This investment constitutes about 32.0% of Charter's economic ownership.

During the nine months ended September 30, 2024, Liberty Broadband sold 698,011 shares of Charter Class A common stock for $226 million to maintain its ownership percentage. The company also expects Charter repurchases to be a primary source of liquidity in future periods.

Operational oversight of GCI and Charter

Liberty Broadband's operational oversight includes managing its wholly-owned subsidiary, GCI Holdings, which reported total revenues of $262 million for the three months ended September 30, 2024, compared to $240 million for the same period in 2023. GCI provides a range of telecommunications services, including data, wireless, video, voice, and managed services, primarily in Alaska.

For Charter Communications, Liberty Broadband reported an Adjusted OIBDA of $5.626 billion for the three months ended September 30, 2024, compared to $5.420 billion for the same period in 2023. This reflects strong operational performance and effective management strategies across both companies.

Financial reporting and compliance

Liberty Broadband emphasizes rigorous financial reporting and compliance. For the nine months ended September 30, 2024, the company reported net earnings attributable to Liberty Broadband shareholders of $578 million, compared to $483 million for the same period in 2023. The effective tax rate for the company was approximately 22% during this period.

Liberty Broadband's total assets were valued at $16.303 billion as of September 30, 2024, with total liabilities amounting to $149.371 billion. The company maintains compliance with all debt covenants as of the same date.

Key Financial Metrics	Q3 2024	Q3 2023
Net Earnings (millions)	$142	$162
Adjusted OIBDA - Charter (millions)	$5,626	$5,420
GCI Revenue (millions)	$262	$240
Total Assets (millions)	$16,303	$15,789
Total Liabilities (millions)	$149,371	$147,193

Liberty Broadband Corporation (LBRDK) - Business Model: Key Resources

Equity stake in Charter Communications

As of September 30, 2024, Liberty Broadband holds an approximate 32.0% economic ownership interest in Charter Communications. The carrying value of this investment is approximately $12.8 billion, with a market value of about $14.8 billion.

Liberty Broadband's ownership in Charter is subject to a voting cap of 25.01% due to the terms of the Stockholders Agreement, which stipulates that Liberty must sell shares if its voting interest exceeds this cap.

During the nine months ended September 30, 2024, Liberty Broadband sold 698,011 shares of Charter Class A common stock for $226 million to maintain its ownership percentage.

Cash and cash equivalents of $168 million

Liberty Broadband reported a cash and cash equivalents balance of $168 million as of September 30, 2024. These funds are primarily invested in U.S. Treasury securities, AAA-rated money market funds, and other highly rated financial instruments.

The company’s cash flow for the nine months ended September 30, 2024, included:

• Net cash provided by operating activities: $103 million
• Net cash provided by investing activities: $69 million
• Net cash used in financing activities: $(174) million

Experienced management team

Liberty Broadband's management team has extensive experience in the telecommunications and media industries, which is crucial for navigating the complexities of investments in Charter Communications and other subsidiaries. The leadership's strategic decisions have led to:

• Net earnings of $142 million for the three months ended September 30, 2024.
• Net earnings of $578 million for the nine months ended September 30, 2024.
• Operating income of $30 million for the three months ended September 30, 2024.

The management's focus on maintaining financial health has allowed Liberty Broadband to manage its capital effectively, with total stockholders' equity reported at $9.5 billion as of September 30, 2024.

Key Resource	Value	Details
Equity Stake in Charter	$12.8 billion (carrying value)	32.0% economic ownership interest.
Market Value of Charter Stake	$14.8 billion	Market value as of September 30, 2024.
Cash and Cash Equivalents	$168 million	Invested in U.S. Treasury securities and money market funds.
Net Earnings (3 months)	$142 million	For the three months ended September 30, 2024.
Net Earnings (9 months)	$578 million	For the nine months ended September 30, 2024.
Total Stockholders' Equity	$9.5 billion	As of September 30, 2024.

Liberty Broadband Corporation (LBRDK) - Business Model: Value Propositions

Reliable broadband and telecommunications services

Liberty Broadband Corporation, primarily through its subsidiary GCI Holdings, provides a comprehensive suite of telecommunications services including broadband, wireless, video, and voice services. As of September 30, 2024, GCI Holdings reported 156,400 cable modem subscribers and 200,300 wireless lines in service. The company emphasizes reliability in its service delivery, which is crucial in a competitive market where customer retention hinges on consistent performance.

Strong financial performance and growth potential

Liberty Broadband has demonstrated robust financial performance with net earnings reaching $578 million for the nine months ended September 30, 2024, compared to $483 million in the same period of 2023. The company’s revenue for the same period was $753 million, marking an increase from $731 million in 2023. Adjusted OIBDA for GCI Holdings was reported at $276 million for the nine months ended September 30, 2024. This strong financial footing provides Liberty Broadband with the capacity to invest in network improvements and expand its service offerings, thereby enhancing its value proposition to customers.

Diverse service offerings across regions

Liberty Broadband operates a diverse portfolio of services tailored to meet the needs of various customer segments across different regions. GCI Holdings serves residential, business, governmental, educational, and medical sectors, primarily in Alaska. The diverse range of services includes managed services that cater to specific industry requirements, thereby offering unique solutions that differentiate Liberty Broadband from competitors. The financial data indicates that Liberty Broadband's capital expenditures for the nine months ended September 30, 2024, were $183 million, underscoring its commitment to enhancing service offerings and operational capabilities.

Metric	September 30, 2024	September 30, 2023
Net Earnings (Millions)	$578	$483
Revenue (Millions)	$753	$731
Adjusted OIBDA (Millions)	$276	$271
Cable Modem Subscribers	156,400	159,300
Wireless Lines in Service	200,300	200,300
Capital Expenditures (Millions)	$183	$149

Liberty Broadband Corporation (LBRDK) - Business Model: Customer Relationships

Long-term contracts with business and residential customers

Liberty Broadband Corporation focuses on establishing long-term contracts to ensure stable revenue streams from both business and residential customers. The company has reported a total of $262 million in revenue from GCI Holdings for the quarter ended September 30, 2024, which includes $125 million from data services, $11 million from wireless services, and $18 million from lease, grant, and subsidies.

Continuous engagement through customer service initiatives

Liberty Broadband emphasizes continuous engagement with its customer base through various customer service initiatives. As of September 30, 2024, the company had 156,400 cable modem subscribers and maintained 200,300 wireless lines in service. This engagement is crucial for customer retention and satisfaction, which is reflected in their stable subscriber numbers.

Focus on customer satisfaction and retention

The company places a strong emphasis on customer satisfaction to enhance retention rates. For the nine months ended September 30, 2024, Liberty Broadband had a net income of $578 million, up from $483 million in the same period of 2023, indicating effective cost management and customer retention strategies. Additionally, the company’s customer relationships are valued at $515 million on the balance sheet.

Customer Segment	Revenue (in millions)	Subscriber Count
Residential Customers	$125	156,400 cable modem subscribers
Business Customers	$11	200,300 wireless lines in service
Lease and Subsidies	$18	N/A
Total	$262	N/A

Liberty Broadband Corporation (LBRDK) - Business Model: Channels

Direct sales through GCI and Charter's platforms

Liberty Broadband Corporation utilizes direct sales channels primarily through its subsidiaries, GCI and Charter. For the three months ended September 30, 2024, Charter reported revenues of $13,795 million, compared to $13,584 million for the same period in 2023. GCI Holdings contributed $262 million in revenue for the same quarter, an increase from $240 million in the previous year. The direct sales model allows Liberty Broadband to maintain a robust presence in the market, capitalizing on its established platforms and customer base.

Online service portals for customer transactions

Liberty Broadband leverages online service portals to facilitate customer transactions, allowing users to manage their accounts, pay bills, and access services seamlessly. In the nine months ended September 30, 2024, GCI Holdings reported a total revenue of $753 million, reflecting the effectiveness of its online customer service initiatives. The online platform enhances customer engagement and reduces operational costs by minimizing the need for in-person interactions.

Marketing campaigns targeting local communities

Liberty Broadband's marketing strategy includes targeted campaigns aimed at local communities, particularly through GCI's initiatives in Alaska. These campaigns are designed to enhance brand visibility and drive customer acquisition. GCI's total operating expenses for the three months ended September 30, 2024, were reported at $64 million, which includes costs associated with marketing efforts. The focus on local marketing helps in establishing a strong connection with the communities served, ultimately contributing to customer loyalty and retention.

Channel Type	Revenue (Q3 2024)	Revenue (Q3 2023)	Operating Expenses (Q3 2024)
Charter Direct Sales	$13,795 million	$13,584 million	N/A
GCI Direct Sales	$262 million	$240 million	$64 million
Online Service Portals	$753 million (9M 2024)	$731 million (9M 2023)	N/A
Marketing Campaigns	N/A	N/A	$64 million (part of GCI expenses)

Liberty Broadband Corporation (LBRDK) - Business Model: Customer Segments

Residential customers in Alaska

Liberty Broadband, through its subsidiary GCI Holdings, serves approximately 156,400 cable modem subscribers as of September 30, 2024. This figure reflects a slight decrease from 159,300 subscribers in the previous year. The residential market is a critical segment for GCI, which provides a range of services including broadband internet, cable television, and phone services.

Businesses and governmental entities

GCI Holdings also caters to businesses and governmental entities, providing tailored solutions that include data, wireless, video, voice, and managed services. The company reported that its total assets for GCI Holdings were approximately $3.318 billion as of September 30, 2024, indicating a robust investment in infrastructure to support these sectors. The company’s services are crucial for local governments and businesses that rely on high-speed connectivity and reliable communication services.

Educational and medical institutions

GCI's offerings extend to educational and medical institutions, providing essential connectivity and communication services. The company benefits from programs such as the Rural Health Care (“RHC”) Program, which supports healthcare providers with funding for broadband services, helping them to maintain connectivity in remote areas. This customer segment is vital, as it ensures that institutions can deliver critical services effectively, especially in underserved regions of Alaska.

Customer Segment	Key Metrics	Financial Impact
Residential Customers	Cable Modem Subscribers: 156,400	Revenue Contribution: Significant, driving overall customer base growth
Businesses & Government	Total Assets: $3.318 billion	Revenue Contribution: Steady, with long-term contracts in place
Educational & Medical	Participation in RHC Program	Revenue Support: Enhanced funding for connectivity services

Liberty Broadband Corporation (LBRDK) - Business Model: Cost Structure

Operating expenses primarily from service delivery

For the nine months ended September 30, 2024, Liberty Broadband reported operating expenses, excluding stock-based compensation, of $24,412 million, compared to $24,556 million for the same period in 2023. The total operating costs and expenses for the three months ended September 30, 2024 were $10,460 million, slightly above the $10,458 million reported in the same quarter of 2023.

Investment in infrastructure and technology

Liberty Broadband's capital expenditures for the nine months ended September 30, 2024, amounted to $183 million, an increase from $149 million in the same period of 2023. The company’s investment in property and equipment was reported at $41,846 million as of September 30, 2024. This investment is crucial for maintaining and enhancing service delivery capabilities.

Marketing and administrative costs

Marketing and administrative costs for the nine months ended September 30, 2024, were included in the overall operating expenses of $24,412 million. Within the selling, general and administrative expenses, stock-based compensation was $22 million for the nine months ended September 30, 2024. Additionally, reimbursements to Liberty for direct, out-of-pocket expenses incurred were approximately $5 million.

Cost Category	Amount (in millions)	Notes
Operating Expenses (9 months 2024)	$24,412	Compared to $24,556 million in 2023
Capital Expenditures (9 months 2024)	$183	Increased from $149 million in 2023
Marketing & Administrative Costs (2024)	Included in Operating Expenses	Specific amounts not detailed
Stock-Based Compensation (9 months 2024)	$22	Compared to $25 million in 2023
Reimbursements to Liberty (9 months 2024)	$5	For direct, out-of-pocket expenses

As of September 30, 2024, Liberty Broadband’s total liabilities were reported at $149,371 million. The ongoing operational expenses and investment strategies are critical for sustaining growth and enhancing service delivery in a competitive market landscape.

Liberty Broadband Corporation (LBRDK) - Business Model: Revenue Streams

Subscription fees from broadband services

Liberty Broadband Corporation generates significant revenue through subscription fees for its broadband services. For the nine months ended September 30, 2024, the revenue from broadband services was approximately $41.2 billion, reflecting an increase of $263 million compared to the same period in 2023. The growth in revenue is attributed to an increase in mobile lines and average revenue per customer, although there was a slight decline in the total number of customers.

Period	Revenue from Broadband Services (in millions)	Change from Previous Year (in millions)
Q3 2024	$13,795	$211
9 months 2024	$41,159	$263

Revenue from equity method investments

Liberty Broadband's revenue also includes income from equity method investments, primarily its stake in Charter Communications. As of September 30, 2024, Liberty Broadband held approximately 32% economic ownership in Charter, with a carrying value of about $12.8 billion and a market value of approximately $14.8 billion. The share of earnings from its investment in Charter increased by $20 million for the three months and $31 million for the nine months ended September 30, 2024, compared to the prior year.

Period	Share of Earnings from Charter (in millions)	Change from Previous Year (in millions)
Q3 2024	$346	$20
9 months 2024	$923	$31

Grants and subsidies related to telecommunications services

Liberty Broadband also benefits from various grants and subsidies aimed at promoting telecommunications services. During the nine months ended September 30, 2024, the company received approximately $40 million in grant proceeds related to capital expenditures. These funds are crucial for expanding infrastructure and improving service delivery, thus enhancing overall revenue generation capabilities.

Type of Grant/Subsidy	Amount Received (in millions)
Grants for Capital Expenditures	$40

Updated on 16 Nov 2024

Resources:

1. Liberty Broadband Corporation (LBRDK) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Liberty Broadband Corporation (LBRDK)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Liberty Broadband Corporation (LBRDK)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.