Marc R. Montagner

Thank you, Mark.
Our first quarter results were in line with our expectations. Excluding the impact of weakening foreign currency assumptions, we increased our full year outlook for tower cash flow, adjusted EBITDA and AFFO per share as compared to our initial 2024 outlook. The primary drivers of these increases are direct cost savings associated with towers to be decommissioned and a reduction in our estimated full year share count from completing share buyback.
Due to the current strength of the U.S. dollars versus local currencies in some of our international markets, our overall outlook for site leasing revenue, total revenues, tower cash flow and adjusted EBITDA were slightly down versus our initial guidance.
First quarter domestic same-tower recurring cash leasing revenue growth over the first quarter of last year was 5.9% on a gross basis, 2.3% on a net basis, including 3.6% of churn. $7.5 million of the first quarter churn was related to Sprint consolidation churn, which we anticipate to be approximately $30 million for the full year 2024. As expected, domestic operational leasing activity of bookings, representing new revenue placed under contract during the first quarter, was consistent with the levels of activity we saw in 2023.
Non-Sprint related domestic annual churn continues to be between 1% and 2% of our domestic site leasing revenue. Our previously provided estimates of aggregate Sprint-related churn over the next several years remain unchanged. We anticipate a range of $40 million to $45 million in 2025, $45 million to $55 million in '26 and $10 million to $20 million in 2027.
International same-tower recurring cash leasing revenue growth for the first quarter, which is calculated on a constant currency basis, was 3.3% net, including 4.8% of churn or 8.1% on a gross basis.
In Brazil, our largest international market, same-tower gross organic growth was 6.8% on a constant currency basis. As compared to the previous quarter and full year 2023, our reported international growth rate continued to be impacted by a declining local CPI-linked escalator in Brazil.
Total international churn remained elevated in the first quarter due mostly to carrier consolidation. During the first quarter, 78% of consolidated cash site leasing revenue was denominated in U.S. dollars. The majority of non-U.S. dollar-denominated revenue was from Brazil, with Brazil representing 15.8% of consolidated cash site leasing revenue during the quarter.
As a reminder, our 2024 outlook does not include any churn assumptions related to the Oi wireless consolidation other than the amount associated with the previously announced agreement that we executed with Vivo. If, during 2024, we were to enter into further agreements with other carriers related to the Oi wireless consolidation that may have an impact on 2024, we will adjust our outlook in future earnings calls.
Additionally, the judicial reorganization plan for Oi wireline was recently approved by a majority of creditors. As a result of this plan, we have increased our full year churn outlook for Oi wireline by $2 million to a total of approximately $4 million. This adjustment is including the updated full year site leasing revenue outlook. As a result, all wireline now represent approximately $20 million total annual site leasing revenue in 2024.
During this quarter of 2024, we acquired 11 communication sites for a total cash consideration of $9.2 million. We also built 76 new sites, mostly outside of the U.S. Subsequent to quarter end, we have purchased or under agreement to purchase 271 sites in our existing markets for an aggregate price of $84.5 million. We anticipate closing on these sites under contract by the end of the third quarter.
Our outlook does not assume any further acquisitions beyond those under contract today. We also do not assume any share buyback beyond what was already completed so far this year. However, it is possible that we invest in additional assets, share repurchase or both during the year.
Our outlook for net cash interest expenses and for FFO and FFO per share continues to include the July 1 refinancing of $620 million ABS Tower Securities scheduled to mature in October '24. We assume a refinancing at a fixed rate of 6% per year. Actual rate and timing may vary from these assumptions.
Our balance sheet remains strong and we have ample liquidity. If not for the recent share buyback, our $2 billion revolver would have been fully paid down.
Our current leverage of 6.5x net debt to EBITDA remains near historical low and well below our steady target of 7 to 7.5x.
Our balance sheet is very strong with a current weighted average interest rate of 3.1% across our total outstanding debt.
Our weighted average maturity is approximately 4 years, including the impact of our current interest rate hedge, the interest rate of 96% of our current outstanding debt is fixed.
And now I turn the call over to Mark.

Mark DeRussy

Thank you, Marc. We ended the quarter with $12.4 billion of total debt and $12.2 billion of net debt. Our net debt to annualized adjusted EBITDA leverage ratio was 6.5x, below the low end of our target range. Our first quarter net cash interest coverage ratio of adjusted EBITDA to net cash interest expense was very strong at 5.2x. We continue to use cash on hand to repay amounts outstanding under the revolver. And as of today, we have $195 million outstanding under our $2 billion revolver.
During the first and second quarter, we repurchased 935,000 shares of our common stock for $200 million at an average price per share of $213.85. We currently have $205 million of repurchase authorization remaining under our $1 billion stock repurchase plan. The company's shares outstanding at March 31, 2024, were 107.9 million.
In addition, during the first quarter, we declared and paid a cash dividend of $108.1 million or $0.98 per share. And as of today, we announced that our Board of Directors has declared a second quarter dividend of $0.98 per share, payable on June 19, 2024, to shareholders of record as of the close on May 23, 2024. This dividend represents an increase of approximately 15% over the dividend paid in the second quarter of 2023.
And with that, I'll now turn the call over to Brendan.

Brendan Thomas Cavanagh

Thank you, Mark. Good afternoon.
The first quarter marked a good start to 2024. We executed well operationally and produced financial results in line with our expectations. As a result, we have made very few adjustments to our full year outlook on a constant currency basis.
In many of our markets, macroeconomic challenges have continued and, as a result, incremental network investments by our customers have remained measured and largely in line with activity levels that we saw last year.
In the U.S., leasing activity from an execution standpoint was only slightly higher than the fourth quarter. However, during the first quarter, we saw increases in applications for both new leases and amendments as well as an increase in our services backlog.
Our customers continue to have significant network needs. A large percentage of our sites still require 5G-related upgrades. And data-heavy use cases, including fixed wireless access, will compel continued investment by our customers over the next several years. I am personally of the belief that the current high cost of capital environment is perhaps the biggest overhang on this spending and is driving the more elongated spending cycle.
Nonetheless, the needs are great. Consumers are demanding and competitive pressures will continue. Our infrastructure will be a critical component of the delivery chain for our customers to meet these challenges, and I believe we are well positioned to support them in their efforts. In addition, the current cost of capital may persist longer than anticipated just a few months ago, but I believe it will ultimately come down in time, which will encourage increased network investment. It is all really just a matter of timing.
Internationally, results were also in line with expectations. Although each market has its own specific dynamics, on average, we are in a period of slower growth internationally compared to our historical levels. Lower inflationary escalators are a contributor, but the primary reason is consolidation-related churn and its associated impacts on carrier focus.
Internationally, we have found that during these consolidations, the surviving carriers direct most of their attention to rationalizing their existing networks, causing much of their incremental network expansion. However, new spectrum and new technology generation deployments remain important and we believe will result in an acceleration in organic growth rates over time.
As discussed on our last call, churn remains elevated due primarily to these consolidations, but we believe that the steps we have taken and are taking to reach mutually beneficial contractual amendments with these customers will enhance the long-term strength and stability of our cash flows.
Turning now to our balance sheet and capital allocation priorities. We have not shifted our previously stated overall approach, but we do very much make adjustments along the way in response to broader market dynamics and opportunities. We prioritize our dividend and have again announced a quarterly dividend 15% higher than the prior year period. This dividend level remains less than 30% of our guided full year AFFO, leaving meaningful capital available for allocation.
During the first quarter, we added a relatively small number of towers to our portfolio and, as a result of carrier consolidation, we decommissioned almost as many sites as we added. We remain selective about the quality of the sites that we add to our portfolio, but we really remain particular about the price at which we add them, which these days has been the main gating issue. That's okay as our focus continues to be on return on investment, not growth just for growth's sake.
Opportunities will come along. In fact, they come along all the time. So we are comfortable being patient, appropriately considering the new cost of capital environment we are operating in and going after those opportunities that we believe we can best drive strong returns on.
The sites we are decommissioning are related to consolidation activity among our customers. We will be more proactive in the coming years in evaluating naked sites for cost-saving opportunities and potentially decommissioning.
As I mentioned earlier, cost of capital, and specifically cost of debt, remains high and is now broadly expected to remain elevated for longer. This dynamic beyond any other has had the most significant impact on public tower company valuations. During the first quarter and beginning of the second quarter, we responded to some of this decline in valuations by spending $200 million to repurchase 935,000 shares of our stock. I believe that when there is ultimately a downward shift in rates, repurchases at this level will be even more accretive to future shareholder value.
Nonetheless, rates remain elevated today, and we recognize the impact of potential future higher interest costs on AFFO. So a portion of our capital allocation will continue to be appropriately dedicated to reducing debt.
We are not formally changing our leverage targets as we believe retaining flexibility for the right investment opportunities is valuable, but operating with lower leverage in the current environment is clearly prudent.
Our balance sheet and liquidity position remain in great shape. If not for the share repurchases, our revolver would have been fully paid down as of today. Our average cost of debt remains very low at 3.1%. However, over the next 12 months, we have approximately $1.8 billion that will need to be refinanced. The cost of that debt will certainly be higher than what we are paying today, but our ability to manage the amount of debt needed and the time we are locked into higher rates will be important factors in the approach we take.
Capital is widely available to us. It's really just a matter of cost. We are evaluating a variety of options and we'll provide further updates during the year as incremental steps are taken.
Finally, I would like to revisit some of my comments from our prior earnings call with regard to the portfolio review we have undertaken. On the last call, I mentioned that we had begun an effort to analyze all of our operations and our potential operations through a lens of stabilizing results, growing our core business and shifting our mix more and more to high-quality assets and operations. I do not see this goal as having a finite deadline as it is more definitional around the key decisions we make.
However, there are some very specific steps being taken and looking at each of our key operations, each of our business lines and each of our international markets. We are setting baselines as to where we think these operations end up on a status quo basis 1 year from now, 5 years from now and even 10 years from now. Then based on potential opportunities we see in each case, we are developing alternative results profiles based on different paths we might take, with the ultimate goal being improving the outcome relative to the base case.
We are making good progress and gaining good insights through the effort, but this is not an overnight initiative. Many of the potential steps identified to enhance our positioning in given markets or operations will take time, sometimes possibly years, to effectuate.
After our prior call, a lot of attention was paid to the possibility of divestitures of businesses or markets. While that may be an outcome in some cases, it is far from our priority or preferred path. I would much rather find ways to improve our position in the market through the addition of quality assets, enhance customer relationships and agreements and other creative solutions.
In fact, I was recently visiting our team in Brazil and learned a number of creative solutions we are introducing to enhance the customer experience at our sites and thereby improve the longevity of our customer relationships at those sites. I am encouraged by the seriousness with which our teams are approaching this initiative.
In the end though, as I stated previously, financial results always matter, and we will make the best decisions we can to protect or create shareholder value as our top priority. We have a great business and great assets. It is our job as the management team to maximize the value we can realize from those assets, and that is where our focus squarely is.
I'd like to wrap up by thanking our team members and our customers for their contributions to our solid first quarter, and we look forward to continuing to share our progress throughout the year.
With that, Jeffrey, we are ready for questions.

Question and Answer Session

Operator

(Operator Instructions) Our first question comes from Michael Rollins.

Michael Ian Rollins

Curious if you could discuss a bit more about some of the preconditions you're seeing for better domestic leasing activity, the applications that you described for new leases and amendments, and does this give you encouragement that 2025 can see better leasing activity than 2024.

Brendan Thomas Cavanagh

Yes, Mike, I think it's a little bit premature to say that. My comments about the increased applications are obviously positive in general, as increases, obviously, would be. But I think it's a little bit early. It's only been 2 months since our last report. And we haven't seen a material change. We've just seen a minor step-up directionally in those items. So at this point, I think it's too early to comment on where 2025 will come out.

Michael Ian Rollins

And in terms of just where the activity is coming from, is it coalesced around certain geographies or from certain carriers?

Brendan Thomas Cavanagh

No. I would say it's fairly broad-based. And different geographies, different carriers are perhaps a little bit busier than others. But I think you're aware of some of the initiatives that some of our customers have going on. But I would say, it's generally broad-based across the big 3 carriers.

Michael Ian Rollins

And just one other question. You mentioned about wanting to manage leverage lower in this environment. Do you have a goal as to where you'd like to see your net debt leverage exit the year?

Brendan Thomas Cavanagh

Yes. We don't really have a goal. In fact, we're actually not explicitly changing our targets, although we're obviously operating well below them today. And the reason we're not changing the targets is that opportunities come along and sometimes being flexible and levering back up to take advantage of a particular opportunity may be the best choice, and so I don't want to kind of present it like we have to be the lower number.
I think in absence of investment opportunities that we see as particularly value additive, in the current high interest rate environment, the best option in some cases will be to actually pay down absolute debt. So there's not a particular target, but I think outside of some meaningful opportunity for new assets coming along, you should expect that we would look to reduce our absolute debt levels.

Operator

Our next question comes from Jonathan Atkin.

Jonathan Atkin

I was interested in where you see the most interesting build-to-suit opportunities across your markets. And then as we kind of think about M&A, either within existing markets or elsewhere, can you just remind us in terms of what your guidelines are and where you might be seeing opportunities?

Brendan Thomas Cavanagh

Yes. On the new build opportunities, well, first of all, we're looking in every market that we're in for specific opportunities that meet our requirements because we already have a presence in that market and an operation scalability there. So ideally, we'd like to build sites wherever we can. But specifically, certain markets, in our African markets in particular, we're seeing more opportunities and certain select markets in South America as well.
On the M&A front, I would say the same premise applies in the sense that if we can find high-quality opportunities in any of our existing markets, that's something that we prioritize. But at the end of the day, it really is a financial analysis around the pricing of those assets and what we think we can do in terms of returns based on growth that we think we can achieve over a period typically of about 5 years or so. Our approach hasn't really changed, although our return thresholds have moved up with the cost of capital.

Jonathan Atkin

And then Brazil, can you remind us broadly where Oi is in terms of the equipment being decommissioned off of towers for their mobile network? And then prospectively, for the wireline, you gave a little bit of color in the prepared remarks, but where are they in terms of physical decommissioning as opposed to you haven't already maybe recognized it in your reporting?

Brendan Thomas Cavanagh

Yes. On the Oi wireless side, it varies by carrier. Obviously, they were absorbed into 3 different carriers. I don't know if I could give you an exact percentage, but they're probably 40-ish percent or so of the way through that effort would be my guess, on average. We're definitely seeing the activity there. But as we see here in the U.S., it's an elongated process and it takes some time. So I'd expect this to go on for a number of years.
On the wireline side, we've seen some decommissionings that were really in advance of the efforts that they're undertaking here. But that one actually has the most runway still to go. They just had their reorganization plan approved just a week or so ago. So it's very early days there. But I would expect over the next couple of years, we'll start to get a better sense of that. And in fact, under the plan, they're expecting to reorganize and continue to operate that network at least for the next several years, so we'll see how that progresses in terms of how many sites actually get turned on.

Operator

Our next question comes from Michael Elias.

Michael Elias

First, I just want to delve back on the portfolio review. It seems like when you're talking about the M&A environment, valuation is the holdup. I think just interpretation, that's part of the reason why we're seeing you shift more capital allocation to the buyback. Just curious how your thoughts there have evolved, that would be the first thing. And then second, is there any color that you can share in terms of the 271 sites that you announced that you are acquiring, where they're located, that would be helpful.

Brendan Thomas Cavanagh

Sure. Yes. I would say in terms of evolution of our thinking, we announced this portfolio review publicly last quarter. And it hasn't been that much time, so we're kind of in the midst and throes of that. The one thing that has shifted a little bit, though, in that window of time is that rates are not only staying higher but are expected to continue to stay higher for longer, and that's something that we have to be sensitive to. And so my comments earlier in the prepared remarks are really about that, about the fact that we have to watch that. And in some cases, paying down debt may actually be more accretive than we would have thought even a couple of months ago. And so it's certainly on the table, perhaps more than it was before. And you're right, in that you see less M&A activity and more towards buybacks, for instance, because we see a better return there. So it is still very much financially driven.
In terms of the sites that are under contract, it's pretty much the same sites that were under contract, with a very few exceptions, at our last earnings call. There are a mix of markets, some are here in the U.S., but most are located internationally. South America is the primary place where we have those types of contracts.

Michael Elias

Perfect. And one other question, if I could. On the last quarter earnings call, there was commentary that carrier activity in the U.S. persisted at the current levels that you can see the 4Q '24 exit run rate be below $40 million. Just curious how you're thinking about the potential run rate exiting the year based on the activity that you're currently seeing?

Brendan Thomas Cavanagh

Yes. We didn't change any of our outlook for the year, so that still stands as of today that we would expect a similar number to what we talked about last time exiting the year. So right now, we haven't seen enough shift in carrier activity to change those projections.

Operator

Our next question comes from Simon Flannery.

Simon William Flannery

Brendan, I wonder if you could just characterize some of the big 3 activity. Are you seeing them complete or move further on adding mid-band to existing sites? Are you seeing them move to densification? And any kind of parallels you could draw with the LTE 4G kind of phasing from that initial coverage phase to the next phase, how does this compare? Is it slower, as you noted, because of the rising rates? And perhaps you could just remind us, you talked about an uptick in applications, how should we think about timing from applications to actually execute leases and revenue generation?

Brendan Thomas Cavanagh

Yes. I mean the type of activity, I would say, is a mix. There's still plenty of mid-band spectrum deployments that need to be done, particularly by AT&T and Verizon. And so we're seeing plenty of that. That's the primary driver of amendment activity. But we are seeing more new leases than perhaps we've seen in the past from the big carriers. It's a mix of both coverage and densification, but it's taking a normal transition, I think, that we've seen in previous generations of technology deployment.
The difference really, Simon, and you touched on it, you picked up on what I said, which is it's really just timing. We're seeing this kind of go at a much slower pace perhaps than what we've seen before. That can, of course, change rapidly, but I really do believe that just the cost of money has an effect on that. And it makes total sense why our customers would be a little more disciplined in their capital spending. So that's really what we're seeing.
And then in terms of the time frame from signing agreements or getting applications in and executing them to ultimately revenue generation, it's pretty consistent with what it's been in the past. It's really just the absolute volume that's a little bit lower.

Simon William Flannery

Great. And any color you can provide on DISH?

Brendan Thomas Cavanagh

Yes. I mean we're still signing some leases with DISH. Obviously, it's at a much lower level than it was when they were busier. And we're here to support them with all their needs, but I don't really have much else I can offer you.

Operator

Our next question comes from Rick Prentiss.

Richard Hamilton Prentiss

A couple of questions. One, can you unpack for us how much of the stock buyback you did within March and how much you did subsequent to the quarter?

Brendan Thomas Cavanagh

Yes. I think it's somewhere in our report, or maybe it's not, but it will be in our 10-Q anyway. I believe roughly half, just over half, was in March and the balance was in the beginning of April.

Richard Hamilton Prentiss

Sure. Okay. That helps. And then when we think about the leverage, I think the leverage went up to about 6.5 in the quarter. How should we think about stock buybacks versus allocating towards debt reductions as we look out through the rest of this year? Is 6.5 kind of the new normal in this operating environment? Do you want to go down closer to 6? Just trying to think through how buybacks are fitting in with the debt reduction absolute levels?

Brendan Thomas Cavanagh

Yes. It's not so much the leverage ratio. In fact, the ratio was up but the absolute amount of debt was pretty similar to what it was at year-end. It's a little bit higher because of the buybacks, but not much. It was actually higher on a leverage ratio basis because the EBITDA was down a little bit, mainly because of services. So I'm a little less focused there because we have so much room in our ratio and it's more of a focus on the absolute amount of debt that we're carrying, and specifically because we have these maturities that are coming up in the next 8 months or so. And so as I kind of eye that, our ability to kind of reduce the amount of absolute debt as we approach those maturity dates is really what we'll be targeting as opposed to worrying about where the leverage ratio is.
And I think on the buyback front, we obviously did a couple of hundred million here, and we would be open to doing more. We've generally been opportunistic about it. But in the short term, we have these maturities and so, to some degree, that takes priority.

Richard Hamilton Prentiss

Okay. And then on operational front, I think Marc M. was talking about the Sprint churn, confirming those kind of numbers. Legacy churn, non-carrier consolidation in the U.S. more than 2%. As we look out over the next 1, 2, 3 years, it seems like you might be heading to the lower end of that 1% to 2% historical level because a lot has already been maybe sucked up. Is that something that we might think of as maybe heading more towards the lower end of 1% to 2% as we look out over the next few years?

Brendan Thomas Cavanagh

Yes. That would be my expectation.

Richard Hamilton Prentiss

Great. Very helpful. And I appreciate your clarity on the strategic review. That helps.

Brendan Thomas Cavanagh

Sure.

Operator

Our next question comes from Nick Del Deo.

Nicholas Ralph Del Deo

First, Brendan and Marc, you both commented on tower decommissioning as a source of cost savings and something that might tick up with the consolidation-related churn in the coming periods. Does this entail to anything different than what you have may done historically in churn, like having a lower tolerance for hanging on to naked sites? Or is it just the magnitude of the sites that may be different today versus the past?

Brendan Thomas Cavanagh

Yes, I think it's really more the latter. You've got, obviously, on the Sprint/T-Mo related consolidations here. But internationally, with the Oi consolidation in particular, I mean, those are really the big ones. There's some others here and there, but those are the biggest ones. It's a lot of sites. And so as we kind of look at what can we do in this window of time where carrier spending is a little bit slower and we have some of these headwinds, what can we do to maximize our bottom line results. Costs become a little more material potentially to that story of improvement. So it's really more the volume than it is anything else. But that increased volume requires a little bit more of a concerted direct focused effort on it.

Nicholas Ralph Del Deo

Okay. That makes sense. And then Brendan, one more for you. In your prepared remarks, you noted that your team in Brazil is taking steps to enhance I think you said the customer experience at your sites, which should be value accretive over time. Can you expand on that a bit and maybe share an example or two of what those solutions may have been? I mean it just struck me as interesting because at least those of us on the outside don't necessarily think of tower leasing as something where you tend to see a lot of innovation like that, so any description you can share would be interesting.

Brendan Thomas Cavanagh

Yes. Well, I'm going to sidestep that a little bit because there are some specific things we're doing that are creative, that actually are adding value for our customers down there. Things that relate to power, that relate to other centralized hosting of wireless coverage solutions and even security-related items. As you add some of these types of things in terms of the service package that you provide, you make your site that much better. And when somebody has the choice to make the choice, you want to have your options be preferred. But it's not just that, it also comes with the ability to enter into longer-term agreements that secure that relationship for an extended period of time. And that's really what we're focusing on.
The reason I'm sidestepping it a little bit and not getting too specific with you is that it's a little early and, for competitive reasons, I prefer not to get that specific on it. But as it becomes something that's more material, I'll be happy to share at that point.

Operator

Our next question comes from David Barden.

Alexander John Waters

You got Alex Waters on for Dave. Maybe just first, maybe just when I think about the international churn, obviously elevated this year. I mean, Brendan, could you maybe just walk through the way we should be thinking about it for next year and the couple of years after? And then just in terms of M&A, I think we discussed a little bit about options you might have in existing markets. But can you just talk about your appetite for those that SBA does not have a presence in yet?

Brendan Thomas Cavanagh

Sure, Alex. Yes, on the international churn front, I would expect that it will be elevated for the next couple of years, maybe not quite as high as it is this year, but it will be elevated by historical standards. We used to have almost 0 churn basically. But we've reached a point where you have a lot more consolidation that's taken place across many of our markets. That's driving a lot of it. And so as we just kind of look at when leases are scheduled to roll off and where there's been consolidations and what we think our exposures we might have, plus, frankly, the Oi wireline bankruptcy, those things will, I believe, cause it to stay elevated for the next several years, although, again, hopefully not quite as high as it's been this year.
On the M&A front, yes, I mean, new markets are certainly on the table for us. We're very financially focused when evaluating the opportunities. I believe that our experience over the last decade or more of expanding into international markets has given us the comfort and the confidence that we can do that as well as anybody that we know the things that we need to understand before we enter a market, how to set up operations in a new market. So I'm confident that we can do it from an operational standpoint.
It really just comes down to opportunity that's on the table and the price point at which we can secure it so that it is value additive ultimately for the company as a whole and for our shareholders. That's the guiding issue. And that's harder and harder these days broadly, whether it's new markets or existing markets, because there are a number of situations where I don't think seller expectations have aligned still with where the market has gone. But that could change over time and our willingness to expand in our existing markets or in new markets would remain the same. We would be open to it.

Operator

Our next question comes from Batya Levi.

Batya Levi

A couple of follow-ups. On the network services side, can you talk a little bit about the slowdown you saw in the quarter? And I think you're tracking below your annual guidance. Should we expect this quarter to be the trough and continue to improve from here? And maybe on the tower side, can you give an update on what percent of your sites have been upgraded with 5G equipment now?

Brendan Thomas Cavanagh

Sure. On the services business, yes, it's down a little bit. But as you saw, we did not change our full year outlook, and we do expect that the second half of the year will be slightly higher than the first half of the year. I mentioned in my comments that we saw an increase in our services backlog from the end of the year to the end of the first quarter. That is supportive of that. And all those little things around applications being up, services backlog being higher, support that I think we will see a little bit more services activity in the second half of the year. But I think we'll be able to give you more clarity on that on the next call.
On the tower side, 5G percentage, we're a little more than half now. I think we've said we were around half in the past. While we've seen some increase obviously through the first quarter with volumes being a little bit lower, it's only a little more than half. So the actual percentage that's left to be upgraded is still significant.

Operator

Our next question comes from Richard Choe.

Yong Choe

I have two follow-ups also. I'm not sure if you can tell, but the new lease densification applications, are they mainly in markets where there's a significant amount of fixed wireless?

Brendan Thomas Cavanagh

I can't tell you that for sure, Richard. But that would not be an unreasonable assumption, but I can't tell you that for sure.

Yong Choe

Got it. And then on the decommissionings and cost savings, is there a significant delay from when the decommissions happen and when you can do the cost savings given maybe the ground leases underlying? Or can you kind of get ahead of it and kind of close that timing gap?

Brendan Thomas Cavanagh

Well, our goal is to achieve those savings as quickly as we can. And you're right that there will be many cases where we're able to do that ahead of the decommissioning. In fact, in some cases, it would be our desire to not do the decommissioning and simply put those costs on hold to allow enough time to see what happens. So I think it will be a mix. But where we're able to do that, obviously, it accelerates our ability to generate the cost savings. So that's our first priority.

Operator

Our next question comes from Matt Niknam.

Matthew Niknam

Just two, if I could. First, on the debt maturities, I think you talked about evaluating a variety of options in relation to that. Is there any more color you can share in terms of what's being evaluated in terms of alternative sources of capital? And is there the potential for cap recycling with where multiples and valuations are in the private markets? And then just secondarily, on the tower decommissioning, it's more of a housekeeping item, is that what's driving the boost to tower cash flow ex FX relative to the slight reduction in site leasing tied to the Oi churn?

Brendan Thomas Cavanagh

Your second question, the answer is yes. That is the primary driver. I mean it's small dollars, obviously. You're talking about $4 million for the year, but yes, that's the driver.
On the first question, when I talk about different options, we're mostly referring to different markets, types of debt that we might issue to refinance it. On the question about the cap recycling type of solution, at this point, I think I would defer on that. But the bottom line is we're open to looking at all the different options that are available to us, trying to find the most creative and cost-effective solutions that we can. And we'll let you know as we secure something.

Operator

Our next question comes from Eric Luebchow.

Eric Thomas Luebchow

Brendan, maybe you could talk a little bit about the comprehensive MLA you signed with AT&T last year. Any kind of early learnings on whether you think that's helped generate more activity on your site with that customer and whether there may be appetite for similar agreements with some of your other customers? I believe that T-Mobile had an agreement that expired relatively recently.

Brendan Thomas Cavanagh

Yes, it's actually been very good in the sense that I think it's kind of loosen the gears up, if you will, between the 2 companies. They have a lot of work to do, and we're a big supplier of theirs in terms of tower space. So the ability to have a much easier, free flowing kind of understood process by which we they make requests and we help satisfy those requests has been a positive. And so I think that, in and of itself, is something that we love to have with all of our customers. And I think we generally do. But with AT&T perhaps, it was the one that given that we have never really had any kind of master agreement with them, there was a little more low-hanging fruit there to address.
In terms of the others, every agreement, I think, is very specific to the relationship with that customer and what their needs are and their existing relationship with us. So we're certainly open to master agreements. We've had them in the past with the others. In the case of the T-Mobile agreement, you mentioned that it expired, that's true, but we actually did extend it for a period of time while we kind of look at the longer-term needs for them and how we might structure something that's favorable for both companies into the future. So I think that evidences the fact that we work together well with our customers and are able to find solutions that are beneficial for both parties.

Eric Thomas Luebchow

Great. And just one follow-up from one of the earlier questions. I think you talked about getting to 1% U.S. tower churn, excluding Sprint, in the next few years. So just a glide path to get there, is that coming more from some of your smaller customers? Are you also seeing some current opportunities with the big 3 or 4 customers? Does it have anything to do with less competitive activity from tower overbuilders or anything you can cite to kind of get down to those levels?

Brendan Thomas Cavanagh

Yes, I think it's both. You have less smaller guys just in general. And so therefore, there's just less of a pool of potential leases to churn with the kind of more narrowband type of tenants that we have, so that is a contributor. And with the bigger guys, I think as you have these master agreements, you have less of these, as you said, over builders that are out there and others that are trying to find ways to take existing tenants. While not particularly successful in the past, there were some amount of that. I think that's sort of gone its way and you'll see less and less of that happening in general. So I believe all of those factors will play into it.

Operator

Our next question comes from Walter Piecyk.

Walter Paul Piecyk

I just wanted to go back to the math on the debt reduction and the share repurchase because I think, basically, the way you described it is you noticed what was going on, longer and higher, but then you continued to buy stock back into April, which, I guess, if you could comment on that because I'm not sure how those two things fit.
But then if you look at kind of the reduction on an empirical basis, in '23, we reduced it $600 million. Obviously, you're not on the pace of that yet this year for any reduction, but again, piecemealing, I know 3 or 4 people asked this question, you kind of referenced the $800 million of debt maturities. So if we look at you using another $100 million already in the June quarter and then just the free cash flow in advance of those maturities, it would seem to me that you basically have to turn that spigot off for any share repurchase for the remainder of the quarter and into Q3 if you're specifically targeting those maturities.
I get it that you're looking for other ways to, I guess, refi it or whatever. So if you could just comment on why you were buying stock back when things change. Should we expect more than $600 million given the comments that you made? And how can you do share repurchase if you've got these maturities that you want to address?

Brendan Thomas Cavanagh

Yes. I'm not sure if there's just a moment in time when things change. We bought back stock in late March and basically the first few days of April. And I think that, that still is a good return on investment. The reality, Walt, is it's hard to be that precise and exact-timing all of these things. And I think as we go forward, it doesn't mean that we won't buy stock back at all. I'm just telling you that directionally, as I look at it today, that I think paydowns of debt is slightly more accretive than buying back stock where it is right now. But that doesn't mean there won't be opportunities to do both, and I expect we will do both going forward. But we're going to see what other options we have available to us as we move through the balance of the year, and that will influence how it plays out.

Mark DeRussy

Well, I will add one thing here and that is to say buybacks have a certain mechanic to them where when we were in a blackout period, we typically put a plan in place. And those plans typically prevent us from actually making decisions. So the decisions are made ahead of time, and I think that may help explain the timing of this relative to your comments.

Walter Paul Piecyk

That's fine, Mark. I appreciate that. Just one follow-up though. Again, just based on math, right, this is a very predictable business, right? We can see what the free cash flow is. If you think share repurchase is more important for these reasons that you've outlined, which I don't disagree with, right, and assuming that, that view doesn't change, all of a sudden, the Fed doesn't start (expletive)ing dropping rates left and right in the near future, again, unlikely, I just don't see how that doesn't mean that you have to mostly turn off the share repurchase spigot at least through the end of the year, like it's just the math of the free cash flow and what's available in terms of at least trying to top the $600 million reduction that you did last year.

Brendan Thomas Cavanagh

Yes. No, that's true. There is a certain amount of cash that's available under the current structure that we've got. We're producing a certain amount of AFFO and the proportion allocated to the dividend, and there's the rest, right? And the rest will go to one of these buckets or a mix of these buckets. So what you're saying is right. But things may adjust. Frankly, we may end up with an acquisition opportunity that we think is actually better than all, and that would put both of these things to the side. So I'm retaining some flexibility. But yes, if we're going to pay down a meaningful amount of debt, obviously, we have to stop spending on everything else.

Walter Paul Piecyk

Just got one last operational question. I guess I'll phrase it this way, outside of the big 3 operators and DISH, have you seen anyone demonstrating interest in or submitting applications for CBRS spectrum to deploy on your towers?

Brendan Thomas Cavanagh

Nothing material. No, nothing really.

Operator

Our next question comes from Brandon Nispel.

Brandon Lee Nispel

A quick one for Mark. Could you just quantify the impact of customer consolidation churn versus normal course churn in the quarter, both domestically and international? And maybe for Brendan, sitting here, looking at your leasing and churn numbers...

Brendan Thomas Cavanagh

Brandon, I'm sorry to interrupt you, but we're having a little bit of a hard time hearing you, you're a little garbled. You may have to repeat that first.

Brandon Lee Nispel

Can you hear me better now?

Brendan Thomas Cavanagh

Yes, that's much better. Thanks.

Brandon Lee Nispel

Okay. I'll just start over. So a quick question for Mark, could you just quantify the impact of customer consolidation-driven churn domestically in internationally versus normal course churn in the quarter?
And then, Brendan, for you with where you're sitting today from a leasing standpoint and churn standpoint, internationally and domestically, and what you know about your maturities coming up, what do you think is a reasonable level of AFFO per share growth looking out to '25 and '26 when your heaviest maturities are coming due?

Brendan Thomas Cavanagh

On the second question, AFFO per share growth. I think, Brandon, I mean, the real trick in answering that is that interest rates and interest expense play such a big role in it. So if it weren't for that, if I could tell you exactly what it was going to cost to refinance debt and what the timing was going to be, I could answer that question with a little more precision. Obviously, we make certain assumptions internally here, but I'd rather not speculate on that. If you kind of took that away, I think, a mid-single-digit percentage growth rate for AFFO per share would be what we would achieve even with the churn, but the interest headwinds are going to be a challenge to that.
And then the first question was the customer consolidation churn percentage, Marc?

Marc R. Montagner

Yes. So domestically, Sprint was more than half of the tower churn in the U.S. Internationally, I would say that the majority was in Oi for this first quarter, but Oi is going to pick up in Brazil. So I think we said overall the Oi churn in Brazil would be about $15 million for the year.

Operator

And our next question comes from Brendan Lynch.

Brendan James Lynch

Yes, Brendan Lynch. Maybe just on the refinancings coming up this year, to what extent are you comfortable using the revolver to refinance that debt, if not longer term, at least in the in the short term?

Brendan Thomas Cavanagh

Yes. I mean that's one option that's obviously on the table. The advantage to it, of course, is that it would allow you to retire it quickly over time or as you could over time without having to lock into a longer-term maturity date. But the negative is that it's some of the most expensive debt that we have right now. It would be more expensive than obviously whenever we would refinance it with in a different market. So it's an option.

Brendan James Lynch

Okay. And maybe just one on the technology front. A few quarters back, you were discussing dual-band radios as a potential driver of incremental demand. Maybe just give us an update on where that stands and any other technology initiatives that your customers might be looking at that could contribute to incremental demand going forward?

Brendan Thomas Cavanagh

Yes. Well, we saw a decent amount of deployment of dual-band radios. That certainly was a driver last year and maybe even before that. But at this stage, it seems like most of the focus is on just deploying the mid-band spectrum that they have on hand and just incremental new leases, as we talked about before, for coverage and densification. I wouldn't say that there's anything more technical than that.

Operator

There's currently no other questions in the queue at this time.

Brendan Thomas Cavanagh

Great. Thank you all for dialing in. We appreciate your time tonight and look forward to reporting to you next quarter.

Operator

Ladies and gentlemen, this does conclude our conference for today. Thanks for your participation and using the AT&T Event Conferencing. You may now disconnect.