Executive Summary / Key Takeaways

• Anterix is uniquely positioned as the largest holder of licensed 900 MHz spectrum in the U.S., enabling private wireless broadband networks critical for utility grid modernization, cybersecurity, and the integration of distributed energy resources and AI at the edge.
• The company has successfully transitioned from lab to field with seven utility customers across 15 states, securing nearly $400 million in contracts, including recent significant deals covering 93% of Texas counties, validating its business model and creating a powerful regional deployment template.
• Anterix's core technological advantage lies in its licensed 900 MHz spectrum (Band 106/n106), offering quantifiable benefits like superior coverage efficiency, lower operating costs, faster deployment, and enhanced reliability compared to alternative solutions, forming a significant competitive moat.
• Strategic initiatives like the AnterixAccelerator program, backed by a $250 million investment and currently oversubscribed with interested utilities, aim to accelerate market adoption by addressing pricing and deployment friction, while the FCC's Notice of Proposed Rulemaking for 5x5 MHz expansion signals future spectrum value enhancement.
• Financially, Anterix ended FY2025 with a strong balance sheet ($47.4M cash, zero debt) and substantial contracted proceeds ($150M-$168M outstanding, $80M expected in FY2026), enabling continued investment in spectrum clearing, strategic initiatives, and an opportunistic share repurchase program ($227.7M remaining) aimed at enhancing shareholder value amidst perceived market undervaluation.

The Digital Foundation for a Modern Grid

Anterix Inc. stands at the intersection of critical infrastructure and advanced wireless communication, positioning itself as the utility industry's partner in building the digital foundation for a modern, secure, and resilient electric grid. The company's core business revolves around commercializing its extensive licensed spectrum holdings in the 900 MHz band across the United States. This strategic focus was fundamentally shaped by the FCC's pivotal Report and Order in May 2020, which modernized the band to enable broadband use, allowing Anterix to pursue its two-pronged strategy: converting its legacy narrowband spectrum into valuable broadband licenses and offering these licenses through long-term leases or sales, complemented by emerging platform services.

The demand for Anterix's solutions is driven by profound shifts in the utility sector. Grid modernization efforts, the imperative for decarbonization, and the increasing adoption of distributed energy resources like solar and wind are transforming the grid into a complex, two-way network. Simultaneously, utilities face escalating threats from cybersecurity attacks and the operational challenges posed by extreme weather events. The rise of AI and edge computing further necessitates robust, secure, and ubiquitous connectivity to manage millions of smart devices and sensors required for enhanced visibility, control, and efficiency. Legacy communication systems, often facing interference and lacking the capacity, security, and resilience needed for this evolving landscape, are proving inadequate.

In this dynamic environment, Anterix operates within a competitive landscape that includes traditional wireless carriers (Verizon (VZ), ATT (T), T-Mobile (TMUS), EchoStar (SATS)), other spectrum holders, private radio operators, and technology providers like Motorola Solutions (MSI), Ericsson (ERIC), Nokia (NOK), and Cisco Systems (CSCO). While these competitors offer various communication technologies and services, Anterix differentiates itself through its exclusive licensed 900 MHz spectrum and its deep focus on the unique needs of the utility sector. Competitors like MSI and ERIC, while offering broader portfolios and stronger financial metrics (MSI with ~20-25% operating margins vs. ATEX's negative margins; ERIC with 5-7% revenue growth vs. ATEX's recent 44% growth from a small base), often rely on alternative spectrum or broader enterprise solutions. Anterix's niche positioning and regulatory advantage provide specific benefits that resonate with utility requirements for control, reliability, and coverage.

The Power of 900 MHz: A Technological Moat

Anterix's primary competitive advantage is rooted in its licensed 900 MHz spectrum, designated as Band 106 for LTE and n106 for 5G within the 3GPP global standard. This mid-band spectrum possesses inherent propagation characteristics that are particularly well-suited for utility applications, offering tangible benefits over alternative frequencies and technologies. Quantifiable advantages include approximately 20-30% greater coverage efficiency in rural areas, translating to potentially lower infrastructure costs for utilities compared to higher-frequency bands used by some competitors. This efficiency contributes to an estimated 15-25% lower operating cost per unit for building wide-area utility networks.

The licensed nature of the spectrum ensures priority access and control, critical for mission-critical utility operations, fostering heightened efficiency, resiliency, and security. Anterix's solutions enable a quicker time-to-market for utility private networks, estimated at 20-30% faster deployment compared to navigating shared or unlicensed spectrum complexities. Furthermore, the 900 MHz band demonstrates enhanced reliability in harsh environments, with potentially lower failure rates for utility grid communications during disruptive events. The technology also offers better energy efficiency in spectrum utilization, requiring less power consumption for network operations.

Anterix is not static in its technological pursuits. Recognizing the growing bandwidth demands, the company, alongside a broad coalition of utilities and industry associations, petitioned the FCC to expand the 900 MHz broadband segment from 3x3 MHz to 5x5 MHz. The FCC's adoption of a Notice of Proposed Rulemaking (NPRM) in January 2025 is a significant step, proposing to provide utilities with greater capacity for future use cases and potentially allowing them to serve other entities within their footprints. While a multi-year process, this initiative signals a potential enhancement of the spectrum's long-term value. The company is also developing complementary platform services like CatalyX for connectivity and SIM management and is actively involved in DOE/EPRI initiatives focused on enhancing grid cybersecurity, leveraging its secure network foundation. These technological advancements and strategic R&D efforts contribute directly to Anterix's competitive moat, supporting its market positioning and enabling it to address the evolving needs of the utility sector, including the integration of AI and edge computing.

Momentum Builds: Performance, Pipeline, and Financial Strength

Anterix's recent financial performance reflects the early stages of commercializing its spectrum assets and executing its strategic plan. For the fiscal year ended March 31, 2025, the company reported spectrum revenue of $6.03 million, a 44% increase from $4.19 million in FY2024, primarily driven by revenue recognition from agreements with Xcel Energy (XEL) and Evergy (EVRG). Despite the revenue growth, the company's net loss increased by 25% to $11.4 million in FY2025, up from $9.1 million in FY2024. This wider loss was influenced by a $3.8 million increase in severance and related charges, partially offset by the rise in spectrum revenue and higher net gains from intangible asset transactions. Gains on the sale of intangible assets, net, significantly increased by 148% to $18.3 million in FY2025, primarily due to the transfer of four broadband licenses to Oncor, while gains on the exchange of intangible assets, net, decreased by 35% to $22.8 million, reflecting the volume of narrowband-to-broadband license exchanges in the respective periods.

Financially, Anterix maintains a strong position. The company ended Fiscal Year 2025 with $47.4 million in cash and cash equivalents and, notably, zero debt. This liquidity is further bolstered by substantial contracted proceeds from signed customer agreements, totaling approximately $150 million to $168 million outstanding to be received over the next several years. Management specifically anticipates receiving roughly $80 million of these contracted payments during Fiscal Year 2026. This robust financial health provides Anterix with the flexibility to fund its operations, invest in spectrum clearing activities (projected CapEx of $15M-$20M in FY26), pursue strategic initiatives, and return value to shareholders.

Operational achievements underscore the company's progress. Anterix has now secured agreements with seven leading utility customers across 15 states, representing nearly $400 million in contracted proceeds. Key recent wins include the $102.5 million agreement with Oncor and the $13.5 million expansion agreement with LCRA, which collectively mean Anterix's partners now cover 93% of Texas counties, establishing a powerful regional deployment model. The company emphasizes that its solutions have moved "from the lab to the field," with existing customers actively deploying networks and demonstrating successful use cases. To accelerate future adoption, Anterix launched the AnterixAccelerator initiative with a committed investment of up to $250 million. This program, designed to test the correlation between price and action and reduce deployment friction, has seen significant early traction and is currently oversubscribed with utilities in active discussions. Management also implemented targeted cost reductions, expecting to lower the operating expense run rate by approximately 20% annually from prior levels, further enhancing cash flow generation.

Outlook, Strategic Acceleration, and Shareholder Value

Anterix's outlook is centered on leveraging its established market leadership and financial strength to capitalize on the growing demand for private utility broadband. Management projects significant percentage growth in contracted proceeds in Fiscal Year 2026 compared to the $116 million achieved in FY2025, driven in part by the momentum generated by the AnterixAccelerator program. They anticipate continued operational expense savings and managed capital expenditures focused on spectrum clearing necessary for contract fulfillment.

The company's strategic review process, initiated in February 2025 with Morgan Stanley (MS) following inbound interest, represents a potential catalyst. While the outcome is not predetermined, the goal is to explore opportunities that could accelerate the company's efforts and deliver enhanced value to shareholders. This process, combined with the potential for the 5x5 MHz FCC expansion and the traction from the AnterixAccelerator, highlights a period of potential strategic inflection.

Management believes the company's stock is currently undervalued, particularly when comparing its market capitalization to the rate at which it has successfully sold or leased spectrum. This conviction fuels their intent to be more aggressive with the share repurchase program. With $227.7 million remaining under the current authorization as of March 31, 2025, and efforts underway to accelerate cash flow timing (such as pulling $34 million into Q4 FY25), Anterix aims to utilize its financial resources to directly enhance shareholder value through buybacks. The opportunistic nature of the program allows flexibility based on market conditions and cash flow generation.

Conclusion

Anterix is uniquely positioned to address the critical communication needs of the transforming electric utility industry, leveraging its exclusive licensed 900 MHz spectrum and growing ecosystem. The company's success in securing seven utility customers and nearly $400 million in contracts, coupled with strategic initiatives like the AnterixAccelerator and the pursuit of 5x5 MHz expansion, demonstrates tangible progress in commercializing its valuable spectrum assets. Despite current net losses, a strong balance sheet with significant contracted cash inflows and zero debt provides a solid financial foundation. While challenges remain, including competition and the complexities of incumbent clearing and regulatory processes, Anterix's technological differentiation, strategic focus, and commitment to cost discipline and shareholder returns position it as a compelling opportunity for investors looking to participate in the essential modernization of the nation's critical infrastructure.