Channel checks: Telecom — Fiber market growing, while cable may lag

This week we hosted a call with the UBS Telecom analysts to discuss the telecom/fiber market. Telco capex is expected to remain strong: while there has been volatility in telecom stocks recently, the analysts believe fundamentals remain strong and noted that AT&T's and Verizon's capex could be higher in 2027. Fiber-to-the-home passings should grow in 2027: incremental homes passed are expected to rise from 9.1 million in 2026 to over 11 million in 2027, driven by larger companies. Smaller fiber builders such as Ziply and Brightspeed face greater execution and financing risk, with permitting/planning delays and higher interest rates not helping. Starlink poses a greater threat to cable than fiber, as it is expected to deploy higher-capacity satellites and offer lower prices, pressuring cable providers particularly in rural markets, though the analysts don't see a threat to urban/suburban fiber. Data-center interconnection should become a more visible driver, with Lumen securing the