Business Challenges - TDS faces challenges due to its lack of scale compared to larger competitors, which may adversely affect its revenues and operational costs [80]. - TDS' business could be negatively impacted by extreme weather events and natural disasters, potentially leading to service interruptions and increased fixed expenses [82]. - The company is at risk of not being able to attract and retain key talent, which is essential for sustaining and growing its business [83]. - TDS experiences low profit margins and limited access to strategic partnerships, which restricts its ability to invest in new services and products [84]. - Changes in consumer preferences and technological advancements could adversely affect TDS' business, potentially reducing revenues or increasing operational costs [85]. - The development of new technologies may reduce demand for traditional tower leasing, impacting TDS' financial condition [86]. - TDS may face difficulties in executing acquisitions or divestitures, which could disrupt its business operations and financial performance [87]. - Supply chain disruptions from key vendors could adversely affect TDS' ability to maintain its network and meet customer demand [91]. Financial Risks - TDS' liquidity may be adversely affected by declining cash flows or inability to secure financing on acceptable terms, impacting its operational flexibility [99]. - Compliance with financial covenants in credit agreements is critical, as failure to meet these could negatively impact TDS' business and financial condition [100]. - TDS' assets and revenue are primarily concentrated in the U.S. telecommunications industry, which may lead to fluctuations in operating results due to industry-specific conditions [102]. - TDS has significant investments in wireless operating entities that it does not control, which could adversely affect its financial condition and cash flows if these investments lose value [103]. - Disruptions in credit markets or economic conditions could impede TDS' access to financing and negatively affect revenues and cash flows [120]. Regulatory and Compliance Issues - TDS receives financial support from the FCC and state regulatory authorities for its telecommunications and broadband services, particularly in high-cost areas, but future support is uncertain [107]. - Regulatory compliance is critical for TDS, as failure to meet legislative and regulatory requirements could lead to penalties and adversely affect its business operations [104]. - TDS faces risks from potential changes in regulatory policies, which could increase costs and divert resources from other initiatives [105]. Cybersecurity and Legal Risks - Cybersecurity risks are a concern for TDS, with the company experiencing regular cyber-attacks that could impact its operations and financial reporting [120]. - Legal and policy proceedings may impose costs and operational disruptions, affecting TDS' business and financial results [110]. Shareholder and Governance Issues - The TDS Voting Trust holds a substantial majority of Series A Common Shares, which may deter unsolicited takeover attempts and affect shareholder liquidity [114]. - TDS' ability to assess and collect various fees and surcharges is complex and could impact its financial condition if not managed properly [108].

Core Insights - Telephone and Data Systems, Inc. (TDS) reported strong fourth-quarter 2025 results, with both revenue and net income exceeding expectations, driven by growth in the Array segment and residential broadband connections [1][2][3] Financial Performance - TDS achieved a net income of $54.5 million or 32 cents per share from continuing operations, a significant increase from $18.3 million or 1 cent per share in the same quarter last year, surpassing the Zacks Consensus Estimate by 23 cents [2] - Total revenues reached $330.7 million, up from $295.4 million year-over-year, exceeding the Zacks Consensus Estimate by $11 million [3] - Array segment revenues increased to $60.3 million from $26.1 million, supported by strong tower rental revenues, resulting in an operating income of $8.6 million compared to a loss of $29.1 million in the prior year [4] Operational Highlights - TDS Telecom contributed $260.9 million to total revenues, slightly down from $264.3 million in the previous year, with total residential connections decreasing to 905,600 from 935,700 [5] - The company deployed 140,000 new marketable fiber addresses in 2025 and recorded 44,900 net broadband additions, with total broadband connections rising to 1,079,500 [6] Cost and Profitability - Total operating expenses were $313.9 million, up 13% from the prior year, while operating income remained relatively stable at $16.83 million [7] - Adjusted EBITDA for TDS Telecom was $85 million, an increase from $80 million, while Array Digital's adjusted EBITDA rose to $52.08 million from $24.5 million [7] Cash Flow and Liquidity - TDS generated $338.3 million in net cash from operating activities, an increase from $295.78 million in the previous year, with cash and cash equivalents totaling $765.9 million as of December 31, 2025 [8] Future Outlook - For 2026, TDS management anticipates total operating revenues for TDS Telecom to be between $1.015 billion and $1.055 billion, with adjusted EBITDA expected in the range of $310 million to $350 million [10] - Array is projected to have operating revenues between $200 billion and $215 billion, with adjusted EBITDA estimated at $200 million to $215 million [11]

Financial Data and Key Metrics Changes - In Q4 2025, total operating revenues decreased by 1% year-over-year and 2% for the full year, with revenues flat year-over-year when excluding divestitures [19][21] - Adjusted EBITDA improved by 6% in Q4, but declined by 6% for the full year due to divestitures and a non-cash adjustment in Q1 [20][21] - Capital expenditures for the full year were $406 million, with a forecast for 2026 between $550 million and $600 million [21][22] Business Line Data and Key Metrics Changes - TDS Telecom added 58,000 new marketable fiber addresses in Q4, a 39% increase year-over-year, and delivered 140,000 new addresses for the full year [11][12] - Residential fiber net adds were approximately 15,000 in Q4, up 11% from Q4 2024, totaling about 45,000 for the year [12][18] - Cash site rental revenue for Array increased by 64% year-over-year in Q4, with a 96% increase when including T-Mobile interim site revenue [29] Market Data and Key Metrics Changes - The divestitures in 2025 impacted revenues, accounting for a $3 million decline in Q4 compared to the prior year [19] - The company identified 300,000 additional fiber address opportunities across approximately 50 new communities, increasing long-term fiber address goals from 1.8 million to 2.1 million [8][15] Company Strategy and Development Direction - The company aims to strengthen its corporate and capital structure, grow TDS Telecom's fiber business, and support Array's success as a tower company [5][6] - The focus for 2026 includes delivering a fiber build plan, driving sales growth, and enhancing customer experience [16][17] - Array's strategy emphasizes optimizing tower operations and monetizing spectrum holdings, with significant progress in spectrum monetization already achieved [24][25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growth prospects for 2026, particularly in fiber and tower operations, despite challenges from divestitures and legacy revenue declines [22][37] - The company is focused on executing its business transformation initiatives to improve operational efficiency and customer experience [14][17] Other Important Information - TDS repaid $150 million in term loan debt and received a special dividend of $726 million from Array's spectrum sale [7][8] - The company is committed to delivering $100 million in savings by the end of 2028 through business transformation efforts [16] Q&A Session Summary Question: Is DISH included in the 2026 guidance? - DISH is completely out of the 2026 guidance for revenue, OIBDA, and free cash flow, with any settlement considered upside [45][47] Question: What is the outlook for tower leasing applications? - The company is optimistic about growth prospects for 2026, expecting significant same-store growth and positive results from insourcing the sales team [48][49] Question: How is the company addressing video services? - The company sees video as a critical part of its value proposition and does not plan to outsource it, as it attracts bundled customers [87] Question: What is the strategy for monetizing naked towers? - The company views naked towers as having significant latent value and aims to reduce holding costs while exploring lease-up opportunities [93] Question: What is the growth rate embedded in the revenue guidance for 2026? - The expected growth rate on a same-store basis is around 6%, excluding DISH revenue [83]

Financial Data and Key Metrics Changes - In Q4 2025, total operating revenues decreased by 1% year-over-year, while for the full year, revenues declined by 2%. Excluding divestitures, revenues were flat year-over-year for both periods [19][21] - Adjusted EBITDA improved by 6% in Q4, but declined by 6% for the full year, primarily due to divestitures and a non-cash adjustment to stock-based compensation in Q1 [20][21] - Capital expenditures for the full year were $406 million, with a forecast for 2026 of $550 million to $600 million, driven by expansion efforts [21][35] Business Line Data and Key Metrics Changes - TDS Telecom added 58,000 new marketable fiber addresses in Q4, a 39% increase year-over-year, and delivered a total of 140,000 new marketable fiber addresses for the full year [11][12] - Residential fiber net adds were approximately 15,000 in Q4, up 11% from Q4 2024, totaling about 45,000 for the year [12][18] - Cash site rental revenue for Array increased by 64% year-over-year in Q4, with a 96% increase when including T-Mobile interim site revenue [29] Market Data and Key Metrics Changes - The divestitures in 2025 accounted for a $3 million revenue decline in Q4 compared to the prior year [19] - The company identified 300,000 additional fiber address opportunities across approximately 50 new communities, increasing long-term fiber address goals from 1.8 million to 2.1 million [8][15] Company Strategy and Development Direction - The company aims to strengthen its corporate and capital structure, grow TDS Telecom's fiber business, and support Array's success as a tower company [5][6] - The focus for 2026 includes delivering a fiber build plan of 200,000 to 250,000 new marketable fiber addresses and enhancing customer experience [16][21] - Array's strategy emphasizes optimizing tower operations and monetizing spectrum holdings, with significant progress in spectrum monetization already achieved [24][25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growth prospects for 2026, particularly in fiber and tower operations, despite challenges from legacy revenue declines [11][24] - The company is focused on executing its business transformation initiatives to improve operational efficiency and customer experience [14][16] Other Important Information - TDS repaid $150 million in term loan debt and received $726 million from a special dividend related to the AT&T spectrum sale [7][8] - The company plans to continue disciplined share repurchase activities, with $524 million remaining on its authorization as of the end of 2025 [9] Q&A Session Summary Question: Is DISH included in the 2026 guidance? - Management confirmed that DISH is completely out of the 2026 guidance, and any settlement would be considered upside [45][47] Question: What is the outlook for tower leasing applications? - Management is optimistic about growth prospects for 2026, expecting significant same-store growth and positive results from insourcing the sales team [48][49] Question: How is the company approaching video services? - Management believes video is a critical part of their value proposition and does not plan to outsource it, as it attracts bundled customers [89] Question: What is the strategy for monetizing naked towers? - Management sees significant latent value in naked towers and aims to reduce holding costs while exploring leasing opportunities [95] Question: What is the growth rate embedded in the revenue guidance for 2026? - Management expects around 6% growth on a same-store basis, excluding DISH revenue [85][86]

Financial Data and Key Metrics Changes - In Q4 2025, total operating revenues decreased by 1% compared to the previous quarter and by 2% for the full year, with revenues flat year-over-year when excluding divestitures [17][18] - Adjusted EBITDA improved by 6% in Q4, but declined by 6% for the full year due to divestitures and a non-cash adjustment to stock-based compensation in Q1 [18] - Capital expenditures for the full year were $406 million, with a forecast increase to $550 million-$600 million for 2026 [19] Business Line Data and Key Metrics Changes - TDS Telecom added 58,000 new marketable fiber addresses in Q4, a 39% increase year-over-year, and delivered a total of 140,000 new marketable fiber addresses for the full year [10][11] - Residential fiber net adds were approximately 15,000 in Q4, up 11% from Q4 2024, totaling about 45,000 for the year [11][12] - Cash site rental revenue for Array increased by 64% year-over-year in Q4, with a 96% increase when including T-Mobile interim site revenue [25] Market Data and Key Metrics Changes - The divestitures in 2025, including the sale of wireless operations, have concentrated TDS's footprint in economically viable markets for fiber [12] - The company identified 300,000 additional fiber address opportunities, raising its long-term goal from 1.8 million to 2.1 million fiber addresses [13][14] Company Strategy and Development Direction - TDS aims to strengthen its corporate and capital structure, grow TDS Telecom's fiber business, support Array's tower operations, and enhance company culture while delivering strong operational results [4][5] - Array focuses on optimizing tower operations and monetizing spectrum, with significant progress in spectrum monetization agreements with major carriers [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growth prospects for 2026, particularly in fiber and tower operations, despite challenges from legacy revenue declines and divestitures [19][34] - The company is committed to delivering a best-in-class customer experience and achieving operational efficiency through ongoing business transformation efforts [14][15] Other Important Information - TDS repaid $150 million in term loan debt and received $726 million from a special dividend related to the AT&T spectrum sale [6][7] - The company plans to continue disciplined share repurchase activities, with $524 million remaining on its authorization as of the end of 2025 [8] Q&A Session Summary Question: Is DISH included in the 2026 guidance? - Management confirmed that DISH is completely out of the 2026 guidance, and any settlement would be considered upside [43][44] Question: What is the outlook for tower leasing applications? - Management expressed optimism about growth prospects, expecting significant same-store growth and positive results from insourcing the sales team [45][47] Question: How is TDS Telecom addressing video bundling? - Management emphasized the importance of video in their value proposition and plans to strengthen video bundling alongside broadband offerings [84] Question: What is the growth rate embedded in the revenue guidance for 2026? - Management indicated a growth expectation of around 6% on a same-store basis, excluding DISH revenue [80]

Fourth Quarter 2025 Results 2025 Accomplishments 2026 Strategic Priorities February 20, 2026 Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 All information set forth in this presentation about Telephone and Data Systems, Inc., including its subsidiaries Array and TDS Telecom, except historical and factual information, represents forward-looking statements. This includes all statements about the Company's plans, beliefs, estimates and expectations. These statements are based ...

Financial Performance - TDS reported total operating revenues of $330.7 million for Q4 2025, a 12% increase from $295.3 million in Q4 2024[5] - Net income for Q4 2025 was $37.2 million, with diluted earnings per share of $0.32, compared to $1.0 million and $0.01 in Q4 2024[5] - For the full year 2025, total operating revenues were $1,228.2 million, down from $1,297.0 million in 2024[6] - Total operating revenues for TDS Telecom were $260,956,000 in Q4 2025, down 1% from $264,295,000 in Q4 2024[26] - Operating income for TDS Telecom decreased significantly by 71% year-over-year to $14,118,000 in Q4 2025, compared to $49,454,000 in Q4 2024[26] - The company reported a net income from continuing operations attributable to TDS shareholders of $54,525,000 in Q4 2025, a substantial increase from $18,311,000 in Q4 2024[27] - Net income for the year ended December 31, 2025, was $20,242,000, a significant improvement from a net loss of $26,481,000 in 2024[32] - Total operating revenues for the year ended December 31, 2025, were $1,038,358,000, down 2% from $1,060,857,000 in 2024[41] - Operating income for the year ended December 31, 2025, was $19,657,000, a decline of 81% compared to $105,309,000 in 2024[41] Investments and Capital Expenditures - The company repurchased 1,765,863 common shares for $67.4 million in Q4 2025[8] - Capital expenditures for TDS Telecom increased to $154,904,000 in Q4 2025, up from $102,429,000 in Q3 2025, reflecting a focus on infrastructure investment[22] - Cash paid for additions to property, plant, and equipment was $390,529,000 in 2025, compared to $365,446,000 in 2024, indicating continued investment in infrastructure[32] Revenue Growth and Projections - Estimated total operating revenues for TDS Telecom in 2026 are projected to be between $1,015 million and $1,055 million[10] - Array's estimated total operating revenues for 2026 are projected to be between $200 million and $215 million, up from $163 million in 2025[11] - TDS plans to invest in the expansion of TDS Telecom's fiber business and support profitability initiatives at Array in 2026[7] - The company experienced a 34% increase in expansion residential revenues for the year ended December 31, 2025, totaling $152,531,000 compared to $114,113,000 in 2024[41] - Total operating revenues for Array increased by 58% year-over-year to $162,961,000 in 2025, compared to $102,933,000 in 2024[43] Customer Metrics and Service Expansion - TDS Telecom ended 2025 with 1.06 million marketable fiber service addresses, having deployed 140,000 new addresses during the year[5][8] - The company reported a total of 561,900 broadband connections as of December 31, 2025, a slight decrease of 0.1% from 562,400 connections in the previous quarter[22] - The company experienced a net addition of 15,100 residential fiber connections in Q4 2025, compared to 11,200 in Q3 2025, indicating a growth trend[22] - TDS increased its long-term marketable fiber service address goal to 2.1 million, an increase of 300,000 addresses[8] Operating Expenses and Financial Health - Total operating expenses for TDS Telecom increased by 15% year-over-year to $246,838,000 in Q4 2025, compared to $214,841,000 in Q4 2024[26] - Total operating expenses decreased by 30% year-over-year to $255,493,000 in 2025, down from $363,268,000 in 2024[43] - The company reported a net cash used in financing activities of $2,347,065,000 in 2025, significantly higher than $277,459,000 in 2024, primarily due to long-term debt repayment[32] - Cash and cash equivalents at the end of the period increased to $770,150,000 in 2025 from $383,222,000 in 2024, reflecting improved liquidity[32] Earnings and Cash Flow - The company reported a basic earnings per share from continuing operations of $0.32 for Q4 2025, compared to $0.01 in Q4 2024[29] - Free cash flow from continuing operations was reported at $(54,178,000) for 2025, an improvement from $(70,917,000) in 2024[45] - Adjusted EBITDA for the year was $330,255,000, compared to $349,775,000 in 2024, indicating a slight decline[48] - EBITDA for Array reached $89,487,000 in Q4 2025, a substantial increase from $23,535,000 in Q4 2024[48] - Array's adjusted free cash flow for Q4 2025 was reported at $74,862,000, reflecting strong operational cash generation[52] Impairment and Losses - Array's loss on impairment of licenses decreased by 65% to $47,679,000 in 2025, compared to $136,234,000 in 2024[43]

Core Viewpoint - Telephone and Data Systems, Inc. (TDS) has declared dividends for the first quarter of 2026 on various share classes, indicating a commitment to returning value to shareholders [1] Group 1: Dividend Announcements - TDS will pay a quarterly dividend of $375.0000 per share on its 6.000% Series VV Preferred shares, with payment scheduled for March 31, 2026, to holders of record on March 16, 2026 [1] - A quarterly dividend of $414.0625 per share will be paid on the 6.625% Series UU Preferred shares, also payable on March 31, 2026, to holders of record on March 16, 2026 [1] - Common Shares and Series A Common Shares will receive a quarterly dividend of $0.04 per share, payable on March 31, 2026, to holders of record on March 16, 2026 [1] Group 2: Company Background - TDS was founded in 1969 and provides broadband services and wireless infrastructure through its subsidiaries, TDS Telecom and Array Digital Infrastructure, Inc. [1] - Comprehensive financial information, including earnings releases and shareholder information, is available on TDS's investor relations website [1]

Core Insights - TDS Telecom has significantly transformed in 2025, completing the largest transaction in its history with the sale of its wireless business and launching a new tower company, Array, which is now operational [1][2] - The company ended 2025 with 1.06 million marketable fiber service addresses and aims to increase this to 2.1 million by 2026, marking a growth of 300,000 addresses [1][2] - TDS reported total operating revenues of $330.7 million for Q4 2025, a 12% increase from $295.3 million in Q4 2024, and a total revenue of $1,228.2 million for the year, down 5% from $1,297.0 million in 2024 [1][2] Financial Performance - TDS Telecom's net income for Q4 2025 was $37.2 million, or $0.32 per diluted share, compared to $1.0 million, or $0.01 per diluted share in Q4 2024 [1][2] - For the full year 2025, net income attributable to TDS common shareholders was $48.2 million, or $0.39 per diluted share, compared to a loss of $141.4 million, or $(1.24) per diluted share in 2024 [1][2] - Array's site rental revenues grew by 51% year over year, contributing to a total operating revenue of $60.3 million in Q4 2025, compared to $26.1 million in Q4 2024 [2][3] Operational Highlights - TDS Telecom deployed 140,000 new marketable fiber service addresses in 2025, with fiber net additions of 44,900 [1][2] - The company repaid $150 million of debt in January 2026 and repurchased 1,765,863 common shares for $67.4 million in Q4 2025 [1][2] - Array paid a special dividend of $10.25 per share on February 2, 2026, following the sale of wireless spectrum to AT&T for $1.018 billion [1][2] 2026 Guidance - TDS estimates total operating revenues for TDS Telecom in 2026 to be between $1,015 million and $1,055 million, with adjusted EBITDA projected between $310 million and $350 million [1][2] - Array's estimated total operating revenues for 2026 are projected to be between $200 million and $215 million, with adjusted EBITDA expected to be between $50 million and $65 million [1][2] - Capital expenditures for TDS Telecom are estimated to be between $550 million and $600 million for 2026, compared to $406 million in 2025 [1][2]

Core Insights - The upcoming earnings report for Telephone & Data Systems (TDS) is projected to show quarterly earnings of $0.22 per share, a significant increase of 344.4% year-over-year, while revenues are expected to decline by 74.2% to $320.02 million [1] Revenue Estimates - Analysts estimate 'Operating Revenues- TDS Telecom' to be $257.17 million, reflecting a year-over-year decrease of 2.6% [4] - The forecast for 'Operating Revenues- Array' is $118.26 million, indicating a substantial decline of 87.8% year-over-year [4] - 'Operating Revenues- All other' is expected to reach $5.91 million, suggesting a decrease of 1.5% from the previous year [4] Service Revenue Projections - 'Operating Revenues- TDS Telecom- Service- Residential - Wireline, Expansion' is anticipated to be $37.11 million, showing a year-over-year increase of 19.7% [5] - 'Operating Revenues- TDS Telecom- Service- Residential - Cable' is projected at $60.03 million, indicating a decline of 7.7% from the prior-year quarter [5] - 'Operating Revenues- TDS Telecom- Service' is expected to be $256.05 million, reflecting a decrease of 3% year-over-year [6] - 'Operating Revenues- TDS Telecom- Service- Commercial' is forecasted at $35.04 million, indicating a decline of 5.3% from the previous year [6] - 'Operating Revenues- TDS Telecom- Service- Residential' is estimated to be $178.87 million, suggesting a decrease of 1.7% year-over-year [7] - 'Operating Revenues- TDS Telecom- Service- Residential - Wireline, Incumbent' is expected to reach $81.73 million, indicating a decline of 5% year-over-year [7] Adjusted OIBDA - The average prediction for 'Adjusted OIBDA- TDS Telecom' is $76.78 million, slightly down from $77.00 million in the previous year [8] Stock Performance - TDS shares have shown a return of +7.5% over the past month, contrasting with a -1.3% change in the Zacks S&P 500 composite [8]