Uniti Group Inc. (UNIT) | The Buildout — AI Infrastructure

——Mkt cap — · 52-wk —–— · YTD — · delayed

Updated Aug 12, 2026Q2 FY2026 reviewed

Uniti owns a national fiber network and sells dark fiber and wavelength capacity that connect AI data centers.

Bookings +30%

Q2 Fiber Infrastructure bookings beat the prior record by almost 30%.

1.3 PB wave funnel

Waves funnel is about 1.3 petabytes; management calls demand staggering.

141k homes passed

Q2 record, with 38,000 net fiber subscriber adds.

ARPU -2.6% y/y

Q2 consumer fiber ARPU reversed from +5% in Q1.

The Buildout Takeaway

Fiber Infrastructure and Kinetic are accelerating faster than management's prior expectations, but legacy copper/TDM and Uniti Solutions still pull consolidated results down. The open question is whether Q4's large hyperscaler revenue lands as guided or slips into 2027.

Analyst coverage

13 analysts·3 Buy8 Hold2 Sell

Coverage is thin — only 4 price estimates, so no target is shown

Management guidance

FY2026 revenue ~$3.655B midpoint · adjusted EBITDA ~$1.475B midpoint

Important: The Buildout is a data analytics platform. Content is generated by algorithms and AI agents using public filings, earnings transcripts, and market data. This is not personalized investment advice.

Our View

The Verdict

Uniti is a digital infrastructure company with three segments. Kinetic provides fiber-to-the-home broadband in Tier 2 and Tier 3 markets. Fiber Infrastructure sells dark fiber and high-capacity wavelength capacity to hyperscalers, carriers, and enterprises. Uniti Solutions provides managed services and is run as a cash-generative decliner. The AI buildout depends on the physical connectivity layer that Fiber Infrastructure supplies.

Market Cap	—
Revenue (TTM)	$3.5B
Revenue Growth	+199.7%
EBITDA Margin (TTM)	40.9%

Net Debt	$10.4B
Earnings Beats	3 of 7
P/E (TTM)	—
EV/EBITDA (TTM)	—

What We Like

Post-merger, no single customer exceeds 10% of consolidated revenue, eliminating the legacy Windstream concentration of 67-68%.
Fiber Infrastructure 2026 revenue guidance was raised to $1.0 billion and contribution margin to $575 million.
About 80% of hyperscaler business includes selling existing infrastructure, supporting 37% blended lease-up cash yields and about 30% combined IRRs.
Kinetic raised its 2026 build target to 475,000-525,000 homes; Q2 delivered record 141,000 homes passed and 38,000 net adds.
Blended debt yield fell from about 12.5% in February 2023 to about 6.5%; the second ABS priced at a 6.18% weighted average coupon.

What We’re Watching

Q2 consumer fiber ARPU was about -2.6% y/y after +5% in Q1; Q3 is guided down low single digits y/y.
Q3 2026 consolidated results are expected down y/y, with the bulk of large hyperscaler deals in Q4 and possible slippage into early 2027.
Legacy Uniti Solutions and copper/TDM are expected to decline at a mid-teens pace for the next few years.
Neo-clouds and superscalers were about 38% of Q2 bookings on shorter 3-5-year lit/Waves deals, creating a newer credit risk profile.

Bottom Line

The strategic thesis is strengthening at the segment level: Fiber Infrastructure produced a record bookings quarter and shifted toward Waves/lit recurring revenue, while Kinetic set build and subscriber records. The consolidated picture remains transitional—pro forma revenue fell 5% and adjusted EBITDA fell 10% y/y in Q2—so the proof is the timing and conversion of large hyperscaler deals. The key open question is whether Q4 hyperscaler revenue lands as guided or slips into early 2027.

Next upThe next catalyst is Q3 2026 results, when management expects consolidated results to decline y/y and investors will test whether the Waves funnel conversion and Kinetic build pace continue. Q4 2026 then carries the bulk of large sales-type lease revenue, with possible slippage into early 2027.

Last Quarter — Q2 FY2026

Earnings

Q2 2026 revenue was $909.7 million, adjusted EBITDA was $357.1 million, and GAAP net loss was $155.9 million. Gross margin was 24.2%. Fiber Infrastructure bookings were a record, with MRR of approximately $2.2 million, almost 30% above the prior record.

Metric	Q2 FY2026	Q1 FY2026	Q2 FY2025	YoY
Revenue	$910M	$988M	$301M	+202.5%
Gross margin	24.2%	31.4%	—	—
EBITDA	$348M	$431M	$238M	+46.0%
EPS	$-0.62	$-0.28	$-0.07	+728.5%
Fiber Infrastructure bookings MRR	$2.2M (record)	$1.6M	n/a	—

Demand for fiber is continuing to accelerate, and hyperscalers and neo-clouds are leading the way.— Kenneth Gunderman, CEO, July 30, 2026

Management tone: Management's tone shifted from conservative in Q1—holding guidance despite saying the business was tracking ahead of midpoint—to more assertive in Q2, when it raised full-year guidance after the record bookings quarter. Management publicly flagged Q3 as down y/y and said some large deals could slip into early 2027, while emphasizing credit quality on lit/Waves deals.

Management Guidance

After Q2, management raised FY2026 consolidated revenue to approximately $3.655 billion and adjusted EBITDA to $1.475 billion at midpoint. Fiber Infrastructure revenue was raised to $1.0 billion and contribution margin to $575 million. Kinetic new fiber homes constructed was raised to 475,000-525,000, with Kinetic net capex raised to about $1.27 billion. Management guided Q3 down y/y, with the bulk of large deals in Q4 and possible slippage into early 2027.

Business Trajectory

Trajectory

Audited data shows revenue rose from $917.3 million in Q4 FY2025 to $987.5 million in Q1 FY2026, then fell to $909.7 million in Q2. Gross margin compressed from 31.4% to 24.2% over that stretch. The strategic fiber businesses are growing—Kinetic consumer fiber revenue rose 19% y/y in Q2 and Fiber Infrastructure bookings hit a record—but consolidated results are being dragged by legacy Uniti Solutions and copper/TDM declines, which management expects to continue at a mid-teens pace.

Revenue & Margin Trajectory

Gross margin as reported.

Share Price — 12 Months

52-week range $6–$13.

Share Price — 12 Months

52-week range $6–$13.

The Numbers

The Model

The model projects FY+1 revenue of $3,670 million and EBITDA of $1,446 million (39.4% margin), rising to FY+2 revenue of $3,850 million and EBITDA of $1,594 million (41.4% margin). The near-term anchor is the current-year guidance raise; FY+2 reflects the ramp of recurring lease-up and Kinetic fiber economics.

Revenue & EBITDA Projections

Solid bars are reported actuals; outlined bars are model projections — not company guidance.

Metric	FY2025	Next FY (E)	Following FY (E)
Revenue	$2.2B	$3.7B	$3.9B
YoY Growth	—	+64.2%	+4.9%
EBITDA	$1.1B	$1.4B	$1.6B
EBITDA Margin	51.0%	39.4%	41.4%

Projections are the median of 5 independent model runs.

What Could Go Right — and Wrong

What good looks like

Fiber Infrastructure converts the 1.3 petabyte Waves funnel into booked recurring MRR without pricing or credit concessions.
Kinetic reaches 2.33-2.38 million homes passed and 675,000-700,000 fiber subscribers by year-end 2026.
Q4 hyperscaler sales-type lease revenue lands as guided, keeping FY2026 consolidated revenue near the $3.655 billion midpoint.
Consumer fiber ARPU stabilizes in Q4 and returns to 2-3% accretion in 2027.
Non-core asset monetization pool is $500 million to $1 billion over 12-36 months.

What could go wrong

Some large hyperscaler deals slip into early 2027, shifting revenue out of FY2026 and deepening the guided Q3/Q4 dip.
Legacy Uniti Solutions and copper/TDM decline at a mid-teens pace or faster, delaying consolidated growth beyond 2027.
Q4 ARPU stabilization fails, and ARPU remains negative into 2027 instead of accreting 2-3%.
A neo-cloud or superscaler lit/Waves customer credit failure creates a loss in the shorter-duration lease-up book.
Fiber material costs rise mid-2027 and cost per passing breaches the upper end of the guided range, compressing Kinetic margins.

What’s Next

Looking Ahead

Over the next 12 months, the story hinges on Q4 2026 hyperscaler revenue timing, Kinetic's second-half build pace, and Waves funnel conversion. Management expects Q3 consolidated results to decline y/y, with Q4 carrying the bulk of large sales-type lease revenue and possible slippage into early 2027. ARPU is guided down low single digits in Q3, up low single digits in Q4, and 2-3% accretion in 2027 and beyond.

Catalysts

Q3 2026Q3 2026 earnings — Management expects consolidated results down y/y; no material larger deals in Q3.
Q4 2026Q4 hyperscaler revenue — Bulk of large sales-type lease revenue expected; may slip to early 2027.
Q4 2026Q4 ARPU stabilization — Guided to increase low single digits y/y after Q3 decline.
End of 2026Fiber majority of revenue — Fiber expected to become the majority of total revenue.
2027Consolidated growth — Management reaffirmed full-year consolidated revenue and EBITDA growth.
Mid-2027Fiber material cost increase — Expected to rise slightly; cost per passing at upper end of range.

Numbers

Financials

Annual Summary

Metric	FY2024	FY2025	TTM	YoY
Revenue	$1.2B	$2.2B	$3.5B	+91.5%
Gross Margin	85.7%	28.4%	27.9%	5,730bps
EBITDA	$995M	$1.1B	$11.3B	+14.6%
EBITDA Margin	85.3%	51.0%	40.9%	3,422bps
Net Income	$93M	$1.3B	$1.0B	+1259.0%
Free Cash Flow	$12M	−$460M	−$262M	—
Net Cash	—	—	—	—

Key Ratios (Trailing)

Valuation

P/E TTM—
EV/EBITDA TTM—
EV/Revenue TTM—
Price/FCF TTM—

Profitability

Gross Margin (TTM)27.9%
EBITDA Margin (TTM)40.9%
Net Margin (TTM)29.4%
ROIC2.6%
FCF Conversion-59.1%
SBC / Revenue0.7%

Reference

The Company

Uniti Group operates a scaled national fiber footprint, with approximately 240,000 fiber route miles across 47 states and more than 1.0 million customers. Its Fiber Infrastructure segment sells dark fiber, wavelength and lit services, and colocation to hyperscalers, carriers, and enterprises—the physical connectivity layer AI data centers depend on. Kinetic provides fiber-to-the-home broadband across approximately 1,400 markets in 18 states.

The company operates all three segments over its owned network; no owned data centers or power facilities are named in the source. Substantially all customers, operations, and assets are in the U.S. Kinetic runs a multi-year copper-to-fiber overbuild in Tier 2 and Tier 3 markets, while Fiber Infrastructure builds and leases dark fiber and waves. About 80% of hyperscaler business involves selling all or partial existing infrastructure.

Business Segments

Kinetic

Approximately 1,400 markets in 18 states

Fiber-to-the-home provider selling multi-gigabit internet, Wi-Fi, voice, and video.

Growth driver: Copper-to-fiber overbuild; 475,000-525,000 new homes in 2026.

Fiber Infrastructure

2026 revenue guidance $1.0 billion at midpoint

Wholesale and enterprise fiber: dark fiber, wavelength and lit services, colocation.

Growth driver: Hyperscaler/AI demand; record Q2 bookings.

Uniti Solutions

2026 revenue guidance $700 million

Managed services including SD-WAN, SASE, security, UCaaS, and LAN.

Growth driver: Non-core, cash-generative but declining

Competitive Landscape

The 10-K identifies cable providers as the largest source of competition for residential and small-business broadband, with fiber overbuilders, wireless/FWA operators, and satellite broadband as additional pressures. In wholesale fiber, management describes the opportunity as generational in nature.

Cable providers
10-K: largest source of competition for residential and small-business broadband.
Fiber overbuilders
10-K: have built or expanded fiber networks within Uniti's footprint.
Wireless/FWA operators
10-K: emerged as alternative broadband providers.
Satellite broadband offerings
10-K: improved, particularly in rural and lower-speed copper areas.
LEO satellite operators
Q1 2026: first observed LEO-driven churn pop in copper markets.

Rows reflect the 10-K competitive landscape and call commentary; the source refers generally to LEO satellite competition and does not name specific operators.

Supply Chain

Uniti sits as an owner-operator of fiber infrastructure between its supply chain and hyperscaler, carrier, and enterprise customers. The source material does not name specific equipment suppliers; management notes fiber material costs are expected to increase slightly beginning mid-2027.