Steven Moskowitz
President & CEO at Crown Castle
Thanks, Kris, and good afternoon, everyone. We appreciate you joining us for this call and as you can see from our second quarter results we delivered solid operating and financial performance in all three of our businesses and reiterated our full year 2024 outlook. We're confident in our outlook based on having 95% of our expected tower revenue growth for this year contracted either as part of our holistic master license agreements with our major customers or with revenues from regional and local wireless customers and also having implemented changes to our fiber segment which will position us to generate more profitable business and increase our operating efficiencies.
In the tower business, we anticipate organic revenue growth of 4.5% this year and believe that as we look out over the next few years, our growth rate will be higher based on three factors. First, the holistic master license agreements we have with our largest customers provide us a stable and consistent level of growth over time. Second industry forecast estimate that long term US wireless data demand growth will continue to drive the need for significant future communications infrastructure investment, and we are aware that major carriers still have lots of work to do to expand their networks in the 5g build cycle.
And finally, we believe that as more tangible steps are taken by our company to be a best in class supplier of low cost share infrastructure solutions we'll be better positioned to compete for a higher share of revenues as our customers continue to invest in their networks. Moving to our fiber and small cells businesses we've completed many of the changes to our operating plans that we announced in June and have started to see the benefits of those changes through more profitable growth and greater operating efficiencies. As part of the operational review of our fiber segment, which we conducted earlier this year, we affirmed that greater opportunity exists to provide additional customer solutions to enterprise fiber connections and small cell locations that are on or near our existing high quality fiber footprint, which allows us to add revenue without the requirement to invest as much capital as we've done in the past.
Implement these changes in our small cell business our commercial and deployment teams have been working collaboratively with our customers on a mix of outcomes, many of which improves our project economics while also addressing our customers' evolving priorities around network densification and capital allocation. As part of this change in our operating plan, we plan to build fewer anchor nodes in the short run. However, given our large pipeline and our customers' long term densification needs in geographies where we have really robust assets in place, we continue to expect there is sufficient demand to grow small cell revenues by double digits over the next several years.
Turning to our fiber solutions business, we believe we can improve returns by focusing our sales efforts on or near net opportunities that reduce discretionary capital expenditures going forward and to support these changes we've already adjust our go to market commercial plan. We've changed our sales incentive award system and increased our required rates of project returns, resulting in anticipated shorter payback periods on invested capital. So, like. In our small cell business we analyzed the markets around our fiber assets to quantify the opportunities to utilize our existing fiber, and we believe we have ample opportunities to improve capital efficiency while achieving long term organic revenue growth in fiber solutions of 3% per year.
As we announced in June, we believe our more focused effort to target on net and near net demand in both small cells and fiber solutions will drive a more efficient use of capital and will also generate approximately $100 million of annualized run rate cost savings. Importantly, we implemented most of these changes by the end of the second quarter, which keeps us on track to generate approximately $60 million of expected cost savings and reduced capital expenditures by about $300 million for this year. As we continue to deliver solid results and make operational changes, we remain focused on the fiber strategic review, which is active and ongoing.
The management team and I continue working with the Fiber Review Committee, the board of directors, and external consultants to evaluate strategic alternatives to determine how to maximize shareholder value. Now we can't share much more about the process and the timing. What we can share is that we remain actively engaged with multiple third parties who continue to show a lot of interest in our fiber solutions and small cell businesses and will provide updates as the process unfolds.
I'd like to conclude my comments by saying that over the past few weeks, I've been fortunate to have engaged in conversations with more than 50% of our company's employees through either in person conversations -- through either in person conversations and also video conference calls. The goal of my meetings with everybody was to be present and discuss the rationale behind our recent operational changes, answer questions that are on people's minds about the fiber segment, and start to set expectations for everybody in the company going forward.
My takeaways from these discussions was that two major themes exist in the minds of Crown Castle employees. First, they care and have great pride. They're very proud of being part of Crown Castle, and they want our company to be seen as excellent in the minds of the constituents we serve, including shareholders and customers and communities. And second most recognized that to be excellent, we need to continue to make changes in how we operate. And they are engaged and energized about their ability to participate in and lead the process to develop new ways of doing things to help differentiate us as a leader in the sector.
So I'd like to thank all the employees I met for being as open and transparent with me as they were, and to those employees I am yet to meet but will at a time come soon. And to all of our employees, a big thanks for continuing to drive our business and deliver results over the past several months, I know there's been a lot of change and it's reassuring that this team has been able to stay focused on delivering for customers during this period. Having said all that, I would ask all employees and our investors to keep in mind the change management is a process, and it takes time. And I appreciate your understanding as we continue to develop new goals that will improve our chances of taking higher shares of new revenue opportunities, convert a greater share of new revenue down to EBITDA, increase investment returns on the growth capital we deploy both through a balance sheet to generate more optionality for us in the future and ultimately increase shareholder value.
So with that, let me turn it over to Dan to walk through the quarter results.
