SBA COMMUNICATIONS CORP (SBAC) Risk Factors

Recent key developments

Concrete developments — dated events, named agreements and instruments, legal proceedings — that SBA COMMUNICATIONS CORP surfaced in its latest filing.

• T-Mobile accounted for 31.1% of total revenues in 20252025
• AT&T Wireless accounted for 20.3% of total revenues in 20252025
• Verizon Wireless accounted for 15.1% of total revenues in 20252025
• 80.8% of Domestic Site Leasing Revenue came from T-Mobile, AT&T Wireless, and Verizon Wireless in 20252025
• Telefonica accounted for 19.7% of International Site Leasing Revenue in 20252025
• Claro accounted for 18.9% of International Site Leasing Revenue in 20252025
• TIM accounted for 13.4% of International Site Leasing Revenue in 20252025
• Tigo accounted for 11.3% of International Site Leasing Revenue in 2025 following a site purchase from Millicom2025
• T-Mobile accounted for 77.9% of Site Development Revenue in 20252025
• Verizon Wireless accounted for 18.2% of Site Development Revenue in 20252025
• Expected $36.0 million to $40.0 million of churn for the 2026 fiscal year due to competitive pressures in international markets2026
• Consolidation of T-Mobile and Sprint completed in 2020, causing lease churn from overlapping and adjacent Sprint leases2020
• Expected $75.0 million cash site leasing revenue loss over next several years from T-Mobile/Sprint churn
• As of December 31, 2025, variable rate indebtedness under the Revolving Credit Facility and Term Loan was approximately $2.7 billion, or 21.1% of total indebtedness2025-12-31
• Interest rate swaps on the 2024 Term Loan cover $2.0 billion notional, swapping one month Term SOFR plus 175 bps for a blended all-in fixed rate of 5.165% through April 11, 20282028-04-11
• Total principal amount of indebtedness of $12,959,750 as of December 31, 20252025-12-31
• Shareholders' deficit of $(4,853,519) as of December 31, 20252025-12-31
• In late 2025, EchoStar (f/k/a DISH Wireless) notified us it would discontinue its network business2025
• In December 2025, EchoStar defaulted on its payment obligations and the default continued into 20262025-12
• The EchoStar churn is expected to represent approximately $56.0 million of cash site leasing revenue during 20262026
• The site leasing revenues generated by our international operations were approximately 25.0% of our total revenues during the year ended December 31, 20252025-12-31
• Approximately 12.6% of our tenant leases in our international markets include fixed escalators as of December 31, 20252025-12-31
• For year ended Dec 31, 2025, approximately 27.4% of total site leasing revenue was from international operations, with 21.9% in non-U.S. dollar currencies, including 13.6% in Brazilian Reais2025-12-31
• Brazilian Real weakened 4.0% comparing average rate for years ended Dec 31, 2025 and 20242025-12-31
• Intercompany loan agreements with foreign subsidiaries to borrow in U.S. Dollars: aggregate amount outstanding as of Dec 31, 2025 was $0.9 billion and as of Dec 31, 2024 was $1.1 billion2025-12-31
• For years ended Dec 31, 2025 and 2024, recorded an $81.6 million gain and a $156.8 million loss (net of taxes) on remeasurement of intercompany loans due to forex changes2025-12-31
• For year ended Dec 31, 2025, repaid $205.0 million under intercompany loan agreements2025-12-31
• In January 2022, several major U.S. wireless carriers temporarily delayed 5G deployment due to aviation industry concerns about interference with aviation equipment2022-01
• FCC auctions including Auction 108, Auction 110, and Auction 113
• As of December 31, 2025, the average remaining life under our ground leases and other property interests, including renewal options under our control, was approximately 35 years2025-12-31
• Approximately 14.5% of our tower structures have ground leases or other property interests maturing in the next 10 years
• We hold 4,068 towers through right of use agreements
• During the year ended December 31, 2025, we generated $109.2 million of site leasing revenue from right of use towers2025-12-31
• The indentures governing the 2020 Senior Notes and the 2021 Senior Notes, the Senior Credit Agreement, and the mortgage loan agreement for the Tower Securities contain restrictive covenants
• The mortgage loan agreement requires a minimum debt service coverage ratio
• If the debt service coverage ratio falls to 1.30x or lower, excess cash flow is deposited into a reserve account instead of being released to the borrowers
• Funds in the reserve account are not released unless the debt service coverage ratio exceeds 1.30x for two consecutive calendar quarters
• If the debt service coverage ratio falls below 1.15x, an amortization period commences and reserve funds are applied to prepay the mortgage loan until the ratio exceeds 1.15x for a calendar quarter
• The Senior Credit Agreement requires SBA Senior Finance II LLC to maintain a ratio of Consolidated Net Debt to Annualized Borrower EBITDA not exceeding 6.5x for any fiscal quarter
• The Senior Credit Agreement requires a ratio of Annualized Borrower EBITDA to Annualized Cash Interest Expense of not less than 2.0x for any fiscal quarter
• Taxing authorities in Brazil have issued income tax deficiencies related to purchase accounting adjustments for tax years 2017 through 2020
• Taxing authorities have issued income tax deficiencies related to the deductibility of foreign exchange losses on our intercompany loan for the 2020 tax year2020
• As of December 31, 2025, we estimate the aggregate range of reasonably possible losses in excess of amounts accrued to be between zero and $109.7 million, excluding penalties and interest of $172.8 million2025-12-31
• We originally elected REIT status for the taxable year ended December 31, 20162016-12-31
• If the fair market value of our securities in taxable REIT subsidiaries exceeds 25% of our total assets for our tax year beginning in 2026, we could fail to remain qualified as a REIT absent timely action2026
• Ownership limit of 9.8% by value or number of shares, whichever is more restrictive, of outstanding Class A common stock
• Ownership limit of 9.8% in aggregate value of all classes and series of capital stock