Next Level Aviation® to continue to support Pratt & Whitney CSA through consignment of used serviceable engine accessories for an additional three yearsDANIA BEACH, Fla., Oct. 29, 2024 /PRNewswire/ -- Next Level Aviation® (NLA), a leader in the global distribution of used serviceable materials (USM), has extended an agreement with Pratt & Whitney Commercial Serviceable Assets (CSA), regarding the sale of used serviceable material (USM) for aircraft engines for an additional three years. This further enhance ...

U.S. Cellular Corporation (USM) recently inked a definitive agreement with Verizon Communication, Inc. (VZ) to divest a portion of its spectrum holdings. The all-cash transaction is valued at $1 billion, subject to some potential adjustments specified in the purchase agreement, regulatory approvals and customary closing conditions. Post completion of the acquisition, Verizon will gain access to 663 million MHz POPs (MegahertzPopulation) of USM's Cellular (850 MHz) spectrum licenses, as well as 11 million MH ...

The equity market is a powerful mechanism as daily fluctuations in price get aggregated to incredible wealth creation or destruction over the long term. Pacifica Yield aims to pursue long-term wealth creation with a focus on undervalued yet high-growth companies, high-dividend tickers, REITs, and green energy firms. Analyst's Disclosure: I/we have a beneficial long position in the shares of TDS.PR.V either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses ...

Core Insights - United States Cellular (USM) reported a revenue of $927 million for the quarter ended June 2024, reflecting a decrease of 3.1% year-over-year, while EPS increased to $0.20 from $0.05 in the same quarter last year, surpassing the consensus EPS estimate of $0.10 by 100% [1] Financial Performance - Revenue of $927 million compared to Zacks Consensus Estimate of $924.97 million, resulting in a surprise of +0.22% [1] - EPS of $0.20 compared to the consensus estimate of $0.10, indicating a surprise of +100.00% [1] Key Metrics - Postpaid churn rate was 1.2%, slightly above the average estimate of 1.1% [3] - Retail connections for prepaid saw a net addition of 3 million, significantly better than the estimated loss of 8.3 million [3] - Total connections stood at 4.47 million, close to the average estimate of 4.5 million [4] - Retail connections for postpaid experienced a net loss of 24 million, better than the estimated loss of 41.91 million [4] - Prepaid churn rate was 3.6%, lower than the average estimate of 4.1% [5] - Prepaid ARPU was $32.37, slightly below the average estimate of $32.42 [6] - Postpaid ARPU was $51.45, also below the average estimate of $51.87 [7] - Total retail connections for prepaid at the end of the period were 439 thousand, exceeding the average estimate of 428.56 thousand [7] - Gross additions for retail connections in postpaid were 117 million, surpassing the average estimate of 94.94 million [7] - Total retail connections for postpaid at the end of the period were 4.03 million, slightly above the average estimate of 4.01 million [8] - Operating revenues from equipment sales were $184 million, exceeding the average estimate of $179.92 million [8] - Operating revenues from service were $743 million, marginally below the average estimate of $743.47 million [9] Stock Performance - Shares of U.S. Cellular have returned -2.6% over the past month, compared to the Zacks S&P 500 composite's -0.4% change [9] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [9]

[Executive Summary & Strategic Announcements](index=1&type=section&id=Executive%20Summary%20%26%20Strategic%20Announcements) UScellular reported mixed Q2 2024 results with revenue decline but significant net income growth, alongside announcing the sale of wireless operations to T-Mobile [Second Quarter 2024 Performance Highlights](index=1&type=section&id=1.1%20Second%20Quarter%202024%20Performance%20Highlights) UScellular reported a decrease in total operating revenues and service revenues for Q2 2024 compared to the prior year, but achieved significant growth in net income and diluted EPS Q2 2024 Financial Performance (YoY Comparison) | Metric | Q2 2024 | Q2 2023 | Change | | :--------------------------------- | :------ | :------ | :----- | | Total Operating Revenues | $927M | $957M | (3.1%) | | Service Revenues | $743M | $760M | (2.2%) | | Net Income Attributable to Shareholders | $17M | $5M | 240% | | Diluted Earnings Per Share | $0.20 | $0.05 | 300% | - Sequential improvement observed in postpaid gross additions and postpaid net losses, indicating positive momentum in subscriber results[3](index=3&type=chunk) - Postpaid Average Revenue Per User (ARPU) grew by **2%**, while service revenues decreased by **2%**[3](index=3&type=chunk) - Third-party tower revenues increased by **1%**[3](index=3&type=chunk) - Fixed wireless customers grew by **40%** to **134,000**[3](index=3&type=chunk) - Strong cost management across the enterprise led to increased operating income, net income, and Adjusted OIBDA[3](index=3&type=chunk) [Strategic Transactions and Future Outlook](index=1&type=section&id=1.2%20Strategic%20Transactions%20and%20Future%20Outlook) UScellular announced a definitive agreement to sell its wireless operations and select spectrum assets to T-Mobile, expected to close in mid-2025 - UScellular has entered into a definitive agreement to sell its wireless operations and select spectrum assets to T-Mobile, with an expected closing in mid-2025, subject to regulatory approvals[4](index=4&type=chunk) - UScellular will retain nearly **4,400** owned towers, its equity method investments, and approximately **70%** of its spectrum assets[4](index=4&type=chunk) - A strategic alternatives review process is ongoing to opportunistically monetize spectrum assets not included in the T-Mobile transaction[4](index=4&type=chunk) [Consolidated Financial Results](index=5&type=section&id=Consolidated%20Financial%20Results) UScellular's Q2 2024 consolidated results show decreased revenues but improved operating income and net income, with shifts in balance sheet and cash flow dynamics [Consolidated Statement of Operations](index=5&type=section&id=2.1%20Consolidated%20Statement%20of%20Operations) For the second quarter of 2024, UScellular experienced a decline in total operating revenues and service revenues, but achieved substantial growth in operating income, net income, and diluted earnings per share Consolidated Statement of Operations Highlights (Three Months Ended June 30, YoY Change) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Change | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----- | | Service Revenues | $743M | $760M | (2%) | | Equipment Sales | $184M | $197M | (6%) | | Total Operating Revenues | $927M | $957M | (3%) | | Total Operating Expenses | $891M | $923M | (3%) | | Operating Income | $36M | $34M | 6% | | Income Before Income Taxes | $32M | $24M | 31% | | Net Income Attributable to UScellular Shareholders | $17M | $5M | N/M | | Diluted Earnings Per Share | $0.20 | $0.05 | N/M | Consolidated Statement of Operations Highlights (Six Months Ended June 30, YoY Change) | Metric | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | Change | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----- | | Service Revenues | $1,497M | $1,527M | (2%) | | Equipment Sales | $380M | $415M | (9%) | | Total Operating Revenues | $1,877M | $1,942M | (3%) | | Total Operating Expenses | $1,789M | $1,881M | (5%) | | Operating Income | $88M | $61M | 44% | | Income Before Income Taxes | $83M | $49M | 69% | | Net Income Attributable to UScellular Shareholders | $35M | $18M | N/M | | Diluted Earnings Per Share | $0.40 | $0.20 | 95% | [Consolidated Balance Sheet](index=7&type=section&id=2.2%20Consolidated%20Balance%20Sheet) As of June 30, 2024, UScellular's total assets slightly decreased compared to December 31, 2023, primarily due to reductions in inventory and other assets, while cash and cash equivalents increased Consolidated Balance Sheet Highlights (June 30, 2024 vs. December 31, 2023) | Metric | June 30, 2024 | December 31, 2023 | | :--------------------------------- | :------------ | :---------------- | | Total Assets | $10,639M | $10,750M | | Cash and Cash Equivalents | $195M | $150M | | Inventory, net | $143M | $199M | | Licenses | $4,715M | $4,693M | | Property, Plant and Equipment, net | $2,540M | $2,576M | | Total Current Liabilities | $886M | $901M | | Long-Term Debt, net | $2,887M | $3,044M | | Total UScellular Shareholders' Equity | $4,675M | $4,626M | [Consolidated Cash Flows](index=6&type=section&id=2.3%20Consolidated%20Cash%20Flows) For the six months ended June 30, 2024, UScellular significantly increased net cash provided by operating activities, while cash used in investing activities slightly decreased Consolidated Cash Flow Highlights (Six Months Ended June 30, YoY Change) | Metric | 2024 | 2023 | Change | | :---------------------------------------------------- | :----- | :----- | :----- | | Net Cash Provided by Operating Activities | $516M | $390M | 32.3% | | Net Cash Used in Investing Activities | ($284M) | ($345M) | 17.6% | | Net Cash Used in Financing Activities | ($196M) | ($129M) | (52.0%) | | Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash | $36M | ($84M) | N/M | | Cash, Cash Equivalents and Restricted Cash (End of Period) | $215M | $224M | (4.0%) | [Free Cash Flow](index=11&type=section&id=2.4%20Free%20Cash%20Flow) Free cash flow decreased for the three months ended June 30, 2024, but significantly increased for the six-month period year-over-year Free Cash Flow (Non-GAAP) (YoY Change) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Change | | :--------------------------------- | :------------------------------- | :------------------------------- | :----- | | Free Cash Flow | $165M | $182M | (9.3%) | | Metric | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | Change | | :--------------------------------- | :------------------------------- | :------------------------------- | :----- | | Free Cash Flow | $226M | $20M | 1030% | [Segment Performance](index=9&type=section&id=Segment%20Performance) The Wireless segment experienced revenue declines but improved profitability, while the Towers segment consistently grew revenues and operating income [Wireless Segment Results](index=9&type=section&id=3.1%20Wireless%20Segment%20Results) The Wireless segment experienced a decrease in total operating revenues and service revenues for both the three and six months ended June 30, 2024 Wireless Segment Financials (Three Months Ended June 30, YoY Change) | Metric | 2024 | 2023 | Change | | :------------------------- | :----- | :----- | :----- | | Total Operating Revenues | $902M | $932M | (3%) | | Service Revenues | $718M | $735M | (2%) | | Operating Income | $17M | $16M | 5% | | Adjusted OIBDA (Non-GAAP) | $196M | $168M | 16% | | Capital Expenditures | $160M | $140M | 13% | Wireless Segment Financials (Six Months Ended June 30, YoY Change) | Metric | 2024 | 2023 | Change | | :------------------------- | :----- | :----- | :----- | | Total Operating Revenues | $1,826M | $1,892M | (3%) | | Service Revenues | $1,446M | $1,477M | (2%) | | Operating Income | $47M | $24M | 97% | | Adjusted OIBDA (Non-GAAP) | $392M | $344M | 14% | | Capital Expenditures | $286M | $346M | (17%) | [Towers Segment Results](index=10&type=section&id=3.2%20Towers%20Segment%20Results) The Towers segment demonstrated consistent growth in total tower revenues, driven by increases in both third-party and intra-company revenues for the three and six months ended June 30, 2024 Towers Segment Financials (Three Months Ended June 30, YoY Change) | Metric | 2024 | 2023 | Change | | :------------------------- | :----- | :----- | :----- | | Total Tower Revenues | $58M | $57M | 3% | | Third-Party Revenues | $25M | $25M | 1% | | Operating Income | $19M | $18M | 7% | | Adjusted OIBDA (Non-GAAP) | $31M | $30M | 6% | | Capital Expenditures | $5M | $3M | N/M | Towers Segment Financials (Six Months Ended June 30, YoY Change) | Metric | 2024 | 2023 | Change | | :------------------------- | :----- | :----- | :----- | | Total Tower Revenues | $116M | $113M | 3% | | Third-Party Revenues | $51M | $50M | 2% | | Operating Income | $41M | $37M | 10% | | Adjusted OIBDA (Non-GAAP) | $64M | $60M | 7% | | Capital Expenditures | $9M | $5M | 89% | [Key Operating Metrics](index=4&type=section&id=Key%20Operating%20Metrics) UScellular's Q2 2024 operating metrics indicate a decrease in postpaid connections but sequential improvements, alongside growth in fixed wireless customers and improved churn rates [Retail Connections and Subscriber Trends](index=4&type=section&id=4.1%20Retail%20Connections%20and%20Subscriber%20Trends) UScellular reported a decrease in total postpaid connections but showed sequential improvement in postpaid net losses in Q2 2024 Retail Connections (Quarterly Trends) | Metric | Q2 2024 | Q1 2024 | Q4 2023 | Q3 2023 | Q2 2023 | | :-------------------------- | :-------- | :-------- | :-------- | :-------- | :-------- | | Postpaid Total at End of Period | 4,027,000 | 4,051,000 | 4,106,000 | 4,159,000 | 4,194,000 | | Postpaid Gross Additions | 117,000 | 106,000 | 129,000 | 128,000 | 125,000 | | Postpaid Net Additions (Losses) | (24,000) | (44,000) | (50,000) | (35,000) | (28,000) | | Prepaid Total at End of Period | 439,000 | 436,000 | 451,000 | 462,000 | 462,000 | | Prepaid Net Additions (Losses) | 3,000 | (13,000) | (11,000) | — | (8,000) | - Fixed wireless customers grew **40%** to **134,000** (as of Q2 2024)[3](index=3&type=chunk) - First quarter 2024 connections were adjusted to remove **11,000** postpaid and **2,000** prepaid subscribers due to the CDMA shutdown, which are not included in net additions (losses) for the quarter[13](index=13&type=chunk) [Average Revenue Per User (ARPU) and Churn](index=4&type=section&id=4.2%20Average%20Revenue%20Per%20User%20(ARPU)%20and%20Churn) UScellular reported an increase in postpaid ARPU year-over-year, while prepaid ARPU saw a decrease, with both postpaid and prepaid churn rates improving in Q2 2024 ARPU and Churn Rates (Quarterly Trends) | Metric | Q2 2024 | Q1 2024 | Q4 2023 | Q3 2023 | Q2 2023 | | :------------------- | :------ | :------ | :------ | :------ | :------ | | Postpaid ARPU | $51.45 | $51.96 | $51.61 | $51.11 | $50.64 | | Postpaid Churn Rate | 1.16% | 1.22% | 1.44% | 1.30% | 1.21% | | Prepaid ARPU | $32.37 | $32.25 | $32.32 | $33.44 | $33.86 | | Prepaid Churn Rate | 3.60% | 4.06% | 3.87% | 3.68% | 4.18% | - Postpaid ARPU grew **2%** year-over-year[3](index=3&type=chunk) [Financial Guidance and Non-GAAP Measures](index=1&type=section&id=Financial%20Guidance%20and%20Non-GAAP%20Measures) UScellular reaffirmed its 2024 financial guidance and provided detailed reconciliations for non-GAAP measures, excluding strategic review impacts [2024 Estimated Results (Guidance)](index=1&type=section&id=5.1%202024%20Estimated%20Results%20(Guidance)) UScellular reaffirmed its 2024 financial guidance for service revenues, Adjusted OIBDA, Adjusted EBITDA, and capital expenditures, indicating no changes from previous estimates 2024 Estimated Results (Guidance) | Metric | Previous | Current | Change | | :------------------ | :------------- | :-------- | :-------- | | Service Revenues | $2,950-$3,050M | Unchanged | Unchanged | | Adjusted OIBDA | $750-$850M | Unchanged | Unchanged | | Adjusted EBITDA | $920-$1,020M | Unchanged | Unchanged | | Capital Expenditures | $550-$650M | Unchanged | Unchanged | | Income Before Income Taxes (GAAP) | $60-$160M | N/A | N/A | - The 2024 Estimated Results do not reflect any anticipated costs, expenses, or results of the strategic alternatives review[6](index=6&type=chunk) [Non-GAAP Financial Measures Reconciliation](index=2&type=section&id=5.2%20Non-GAAP%20Financial%20Measures%20Reconciliation) UScellular provided detailed reconciliations for its non-GAAP financial measures, including EBITDA, Adjusted EBITDA, and Adjusted OIBDA, to their corresponding GAAP measures Consolidated Non-GAAP Reconciliation (Three Months Ended June 30, 2024) | Metric | 2024 | 2023 | | :------------------------------------------ | :----- | :----- | | Net Income (GAAP) | $18M | $5M | | Income Before Income Taxes (GAAP) | $32M | $24M | | EBITDA (Non-GAAP) | $242M | $236M | | Adjusted EBITDA (Non-GAAP) | $268M | $239M | | Adjusted OIBDA (Non-GAAP) | $227M | $198M | Consolidated Non-GAAP Reconciliation (Six Months Ended June 30, 2024) | Metric | 2024 | 2023 | | :------------------------------------------ | :----- | :----- | | Net Income (GAAP) | $42M | $20M | | Income Before Income Taxes (GAAP) | $83M | $49M | | EBITDA (Non-GAAP) | $503M | $963M | | Adjusted EBITDA (Non-GAAP) | $542M | $986M | | Adjusted OIBDA (Non-GAAP) | $456M | $818M | - Adjusted EBITDA and Adjusted OIBDA are used by management as measurements of profitability, providing additional relevant information to investors by excluding significant recurring non-cash charges, nonrecurring expenses, gains and losses, and other items[6](index=6&type=chunk) [Company Information and Disclosures](index=3&type=section&id=Company%20Information%20and%20Disclosures) UScellular, a wireless provider serving 4.5 million connections, provides essential company details and a safe harbor statement regarding forward-looking information and associated risks [About UScellular](index=3&type=section&id=6.1%20About%20UScellular) United States Cellular Corporation is a Chicago-based wireless provider offering a comprehensive range of products and services, supported by a high-quality network, serving 4.5 million retail connections across 21 states - UScellular provides wireless products and services, customer support, and a high-quality network to **4.5 million** retail connections in **21** states[9](index=9&type=chunk) - The company had **4,300** full- and part-time associates as of June 30, 2024[9](index=9&type=chunk) - Telephone and Data Systems, Inc. (TDS) owned approximately **82%** of UScellular at the end of Q2 2024[9](index=9&type=chunk) [Safe Harbor Statement](index=3&type=section&id=6.2%20Safe%20Harbor%20Statement) The Safe Harbor Statement emphasizes that all forward-looking statements in the news release are subject to various risks and uncertainties, which could cause actual results to differ materially from projections - All forward-looking statements are based on current estimates, projections, and assumptions, involving risks and uncertainties that could cause actual results to differ materially[10](index=10&type=chunk) - Important factors affecting these statements include the successful completion of the T-Mobile transaction, the ability to monetize remaining spectrum assets, strategic decisions regarding the tower business, intense competition, and regulatory environment[10](index=10&type=chunk) - Investors are encouraged to review 'Risk Factors' in UScellular's Form 10-K and subsequent 10-Q filings for a more comprehensive description of risks[10](index=10&type=chunk)

2024 guidance reaffirmed CHICAGO, Aug. 2, 2024 /PRNewswire/ -- As previously announced, UScellular will hold a teleconference on August 2, 2024, at 9:00 a.m. CDT. Listen to the call live via the Events & Presentations page of investors.uscellular.com. United States Cellular Corporation (NYSE:USM) reported total operating revenues of $927 million for the second quarter of 2024, versus $957 million for the same period one year ago. Service revenues totaled $743 million, versus $760 million for the same period ...

Key Picks T-Mobile will pay an aggregate of $4.4 billion to U.S. Cellular, including a combination of cash and up to approximately $2 billion of assumed debt. The transaction is likely to close midway next year, subject to the fulfillment of mandatory closing conditions and other regulatory approvals. Telephone and Data Systems, which boasts about 83% ownership stake in U.S. Cellular, has unanimously agreed to the deal to help unlock significant value for its wireless customers and shareholders. Shares of U ...

T-Mobile, after acquiring UScellular's wireless operations and customers, will use its greater resources to deliver benefits to UScellular customers, including lower prices, more robust plans, superior network experiences, and more added benefits T-Mobile to enter into new MLA and be a long-term tenant on at least 2,600 of UScellular's towers UScellular retains its nearly 4,400 owned towers, its equity method investments, and approximately 70% of spectrum assets UScellular and TDS to hold conference call at ...

Part I [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=3&type=section&id=Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In Q1 2024, UScellular reported a 4% decrease in total operating revenues to $950 million, but operating income surged 94% to $51 million and net income grew 64% to $24 million, driven by a 6% reduction in total operating expenses [Executive Overview](index=3&type=section&id=Executive%20Overview) UScellular, an 83%-owned TDS subsidiary serving 4.5 million retail connections, is undergoing a strategic alternatives review that incurred $7 million in Q1 2024, while focusing on 5G network enhancement and revenue diversification - On August 4, 2023, TDS and UScellular initiated a process to explore strategic alternatives for UScellular, incurring **$7 million** in third-party expenses in Q1 2024[14](index=14&type=chunk) - UScellular's strategy focuses on providing a high-quality network, outstanding customer service, and competitive plans, including increasing revenue from device protection, fixed wireless internet, tower rent, and business solutions[15](index=15&type=chunk) - The company continues its multi-year deployment of 5G mid-band spectrum in 2024 to enhance network speed and capacity for mobility and fixed wireless services[15](index=15&type=chunk) [Operational Overview](index=7&type=section&id=Operational%20Overview) UScellular's Q1 2024 operational performance saw total retail connections decline to 4.487 million, with worsening postpaid net losses due to intense competition, yet Postpaid ARPU increased by 3% to $51.96 Retail Connections (End of Period) | As of March 31, | 2024 | 2023 | | :--- | :--- | :--- | | **Retail Connections – End of Period** | | | | Postpaid | 4,051,000 | 4,223,000 | | Prepaid | 436,000 | 470,000 | | **Total** | **4,487,000** | **4,693,000** | Postpaid Activity and Churn (Q1 2024 vs. Q1 2023) | | Q1 2024 | Q1 2023 | Change | | :--- | :--- | :--- | :--- | | **Total Gross Additions** | 106,000 | 137,000 | (23)% | | **Total Net Additions (Losses)** | (44,000) | (24,000) | (83)% | | **Total Churn** | 1.22 % | 1.27 % | -0.05 p.p. | - Postpaid handset net losses increased year-over-year due to lower gross additions resulting from aggressive industry-wide competition[19](index=19&type=chunk) Postpaid Revenue Metrics (Q1 2024 vs. Q1 2023) | | Q1 2024 | Q1 2023 | Change | | :--- | :--- | :--- | :--- | | Average Revenue Per User (ARPU) | $51.96 | $50.66 | 3% | | Average Revenue Per Account (ARPA) | $132.00 | $130.77 | 1% | [Financial Overview](index=8&type=section&id=Financial%20Overview) For Q1 2024, total operating revenues decreased by 4% to $950 million, while total operating expenses fell 6% to $899 million, leading to a 94% increase in operating income to $51 million and a 64% rise in net income to $24 million Financial Highlights (Q1 2024 vs. Q1 2023) | (Dollars in millions) | Q1 2024 | Q1 2023 | Change | | :--- | :--- | :--- | :--- | | Total operating revenues | $950 | $986 | (4)% | | Total operating expenses | $899 | $960 | (6)% | | Operating income | $51 | $26 | 94% | | Net income | $24 | $14 | 64% | | Adjusted EBITDA (Non-GAAP) | $272 | $252 | 8% | | Capital expenditures | $131 | $208 | (37)% | - Retail service revenues decreased due to a smaller base of postpaid and prepaid connections, partially offset by higher Postpaid ARPU[30](index=30&type=chunk) - Equipment sales revenues declined due to fewer smartphones sold from lower gross additions and upgrades, partly offset by a higher average price for new smartphones[31](index=31&type=chunk) - Selling, general and administrative (SG&A) expenses decreased due to lower employee-related costs, commissions, and advertising, partially offset by a **$7 million** increase for strategic alternatives review expenses[36](index=36&type=chunk) [Liquidity and Capital Resources](index=11&type=section&id=Liquidity%20and%20Capital%20Resources) UScellular maintains liquidity through cash, operating cash flows, and financing agreements, with **$610 million** in available undrawn borrowing capacity as of March 31, 2024, and projected 2024 capital expenditures between **$550 million** and **$650 million** - UScellular believes existing cash, available financing, and operating cash flows will provide sufficient liquidity for day-to-day needs, but may require substantial additional funding for capital expenditures, acquisitions, or spectrum purchases[43](index=43&type=chunk) Available Undrawn Borrowing Capacity (as of March 31, 2024) | (Dollars in millions) | Capacity | | :--- | :--- | | Revolving Credit Agreement | $300 | | Receivables Securitization Agreement | $310 | | **Total available undrawn borrowing capacity** | **$610** | - Capital expenditures for the full year 2024 are expected to be between **$550 million** and **$650 million**, primarily for network enhancement and 5G mid-band deployment[55](index=55&type=chunk) - The company is required to maintain a Consolidated Leverage Ratio not to exceed **4.00 to 1.00** from April 1, 2024, and an Interest Coverage Ratio not lower than **3.00 to 1.00**, with UScellular in compliance with all covenants as of March 31, 2024[51](index=51&type=chunk) [Consolidated Cash Flow Analysis](index=15&type=section&id=Consolidated%20Cash%20Flow%20Analysis) In Q1 2024, cash and cash equivalents increased by **$31 million**, driven by **$203 million** in operating cash flow and a positive free cash flow of **$61 million**, reversing a negative trend from the prior year Consolidated Cash Flow Summary (Q1 2024 vs. Q1 2023) | (Dollars in millions) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $203 | $41 | | Net cash used in investing activities | ($144) | ($192) | | Net cash provided by (used in) financing activities | ($28) | $43 | | **Net increase (decrease) in cash** | **$31** | **($108)** | - The increase in operating cash flow in Q1 2024 was primarily due to net income of **$24 million**, non-cash adjustments of **$175 million**, and distributions from unconsolidated entities of **$22 million**, partially offset by an **$18 million** decrease from working capital changes[61](index=61&type=chunk) Free Cash Flow (Non-GAAP) | (Dollars in millions) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Cash flows from operating activities (GAAP) | $203 | $41 | | Cash paid for additions to property, plant and equipment | ($133) | ($196) | | Cash paid for software license agreements | ($9) | ($7) | | **Free cash flow (Non-GAAP)** | **$61** | **($162)** | [Consolidated Balance Sheet Analysis](index=16&type=section&id=Consolidated%20Balance%20Sheet%20Analysis) The balance sheet saw Property, plant and equipment (gross) decrease by **$1.24 billion** and accumulated depreciation by **$1.20 billion** due to CDMA network decommissioning, while accrued compensation decreased by **$51 million** from bonus payments - The gross basis of Property, plant and equipment decreased by **$1,239 million**, and Accumulated depreciation decreased by **$1,203 million**, mainly because of the decommissioning of fully depreciated assets from the CDMA network shutdown[66](index=66&type=chunk) - Accrued compensation decreased by **$51 million**, primarily due to the payment of associate bonuses in March 2024[67](index=67&type=chunk) [Supplemental Information Relating to Non-GAAP Financial Measures](index=17&type=section&id=Supplemental%20Information%20Relating%20to%20Non-GAAP%20Financial%20Measures) This section defines and reconciles non-GAAP financial measures, with Q1 2024 Adjusted EBITDA at **$272 million** and Adjusted OIBDA at **$228 million**, both showing growth, and Free Cash Flow turning positive at **$61 million** Reconciliation of Net Income to Adjusted EBITDA and Adjusted OIBDA (Q1 2024) | (Dollars in millions) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net income (GAAP) | $24 | $14 | | Add back: Income tax, Interest, D&A | $236 | $228 | | EBITDA (Non-GAAP) | $260 | $242 | | Add back/deduct: Other adjustments | $12 | $10 | | **Adjusted EBITDA (Non-GAAP)** | **$272** | **$252** | | Deduct: Equity earnings, Interest income | $44 | $46 | | **Adjusted OIBDA (Non-GAAP)** | **$228** | **$206** | Free Cash Flow Reconciliation (Q1 2024) | (Dollars in millions) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Cash flows from operating activities (GAAP) | $203 | $41 | | Less: Cash paid for PP&E | ($133) | ($196) | | Less: Cash paid for software licenses | ($9) | ($7) | | **Free cash flow (Non-GAAP)** | **$61** | **($162)** | [Financial Statements (Unaudited)](index=24&type=section&id=Financial%20Statements%20%28Unaudited%29) The unaudited Q1 2024 financial statements show total operating revenues of **$950 million**, net income of **$18 million**, total assets of **$10.70 billion**, and operating cash flow of **$203 million**, with accompanying notes detailing accounting policies and the strategic review impact [Consolidated Statement of Operations](index=24&type=section&id=Consolidated%20Statement%20of%20Operations) For Q1 2024, UScellular reported **$950 million** in total operating revenues, with operating income increasing to **$51 million** and net income attributable to shareholders rising to **$18 million**, resulting in basic earnings per share of **$0.21** Consolidated Statement of Operations Summary | (Dollars in millions) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Total operating revenues | $950 | $986 | | Operating income | $51 | $26 | | Net income attributable to UScellular shareholders | $18 | $13 | | Basic earnings per share | $0.21 | $0.15 | | Diluted earnings per share | $0.20 | $0.15 | [Consolidated Statement of Cash Flows](index=25&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) In Q1 2024, net cash from operating activities was **$203 million**, investing activities used **$144 million**, and financing activities used **$28 million**, leading to a net increase in cash of **$31 million** and an end-of-period balance of **$210 million** Consolidated Statement of Cash Flows Summary | (Dollars in millions) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $203 | $41 | | Net cash used in investing activities | ($144) | ($192) | | Net cash provided by (used in) financing activities | ($28) | $43 | | Net increase (decrease) in cash | $31 | ($108) | | Cash, cash equivalents and restricted cash, end of period | $210 | $200 | [Consolidated Balance Sheet](index=26&type=section&id=Consolidated%20Balance%20Sheet) As of March 31, 2024, UScellular reported total assets of **$10.70 billion**, total liabilities of **$5.03 billion**, and total equity of **$4.67 billion**, with Licenses and net Property, plant and equipment as key assets Consolidated Balance Sheet Summary | (Dollars in millions) | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Total current assets | $1,395 | $1,400 | | Total assets | $10,704 | $10,750 | | Total current liabilities | $837 | $901 | | Total liabilities | $5,031 | $5,101 | | Total equity | $4,673 | $4,642 | | **Total liabilities and equity** | **$10,704** | **$10,750** | [Notes to Consolidated Financial Statements](index=30&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies, revenue recognition, and debt, disclosing **$7 million** in strategic review expenses, **$1.03 billion** in net equipment installment plan receivables, compliance with debt covenants, and consolidation of Variable Interest Entities - The company incurred **$7 million** in third-party expenses related to the strategic alternatives review during Q1 2024, included in Selling, general and administrative expenses[112](index=112&type=chunk) - Net equipment installment plan receivables totaled **$1,032 million** as of March 31, 2024, down from **$1,061 million** at the end of 2023[127](index=127&type=chunk) - As of March 31, 2024, UScellular was in compliance with all financial covenants for its debt agreements, including leverage and interest coverage ratios[136](index=136&type=chunk) - UScellular consolidates several Variable Interest Entities (VIEs), including special purpose entities created to facilitate its receivables securitization program[137](index=137&type=chunk)[138](index=138&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=23&type=section&id=Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) UScellular is exposed to interest rate risk, with approximately **70%** of its **$2.975 billion** long-term debt being fixed-rate and a weighted average interest rate of **6.4%** as of March 31, 2024 - As of March 31, 2024, approximately **70%** of UScellular's long-term debt was fixed-rate, with the remaining **30%** being variable-rate debt, exposing the company to interest rate risk[86](index=86&type=chunk) Principal Payments Due on Long-Term Debt (as of March 31, 2024) | (Dollars in millions) | Long-Term Debt Obligations | Weighted-Avg. Interest Rate | | :--- | :--- | :--- | | Remainder of 2024 | $20 | 7.1% | | 2025 | $20 | 7.1% | | 2026 | $265 | 6.9% | | 2027 | $158 | 7.0% | | 2028 | $286 | 7.4% | | Thereafter | $2,226 | 6.2% | | **Total** | **$2,975** | **6.4%** | [Controls and Procedures](index=37&type=section&id=Controls%20and%20Procedures) UScellular's management concluded that disclosure controls and procedures were effective as of March 31, 2024, with no material changes to internal control over financial reporting during Q1 2024 - UScellular's principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2024, at a reasonable assurance level[149](index=149&type=chunk) - No changes in internal controls over financial reporting occurred during Q1 2024 that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[150](index=150&type=chunk) Part II [Risk Factors](index=20&type=section&id=Risk%20Factors) The company identifies no material changes to its 2023 Form 10-K risk factors, which include intense industry competition, uncertainty from the strategic alternatives review, spectrum acquisition challenges, and cyber-attack threats - The company faces intense competition in products, services, pricing, and network technology, which could adversely affect revenues or increase costs[80](index=80&type=chunk) - The ongoing process to explore strategic alternatives for UScellular creates uncertainty, with no assurance of successful completion or additional value, and could adversely impact the business[82](index=82&type=chunk) - UScellular has experienced and expects to continue experiencing cyber-attacks or other security breaches, which could have an adverse effect on its business and financial results[84](index=84&type=chunk) - The report states there are no material changes to the risk factors previously disclosed in the Form 10-K for the year ended December 31, 2023[85](index=85&type=chunk) [Legal Proceedings](index=37&type=section&id=Legal%20Proceedings) The company reports no material changes to its legal proceedings since the end of the fiscal year 2023 - There have been no material changes to the legal proceedings information disclosed in the Form 10-K for the year ended December 31, 2023[151](index=151&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) UScellular has an authorized share repurchase program with **1,927,000** shares remaining for purchase as of March 31, 2024, but no repurchases were made during Q1 2024 - No purchases of UScellular Common Shares were made by or on behalf of the company during the first quarter of 2024[153](index=153&type=chunk) - The maximum number of shares remaining for purchase under the company's repurchase program was **1,927,000** as of March 31, 2024[153](index=153&type=chunk) [Other Information](index=38&type=section&id=Other%20Information) During Q1 2024, no UScellular directors or officers adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements - No directors or officers adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended March 31, 2024[154](index=154&type=chunk) [Exhibits](index=39&type=section&id=Exhibits) This section lists exhibits filed with the Form 10-Q, including officer incentive plans, award agreements, officer certifications, and XBRL data files

NEWS RELEASE Exhibit 99.1 As previously announced, UScellular will hold a teleconference on May 3, 2024, at 9:00 a.m. CDT. Listen to the call live via the Events & Presentations page of investors.uscellular.com. UScellular reports first quarter 2024 results 2024 guidance reaffirmed CHICAGO (May 3, 2024) — United States Cellular Corporation (NYSE:USM) reported total operating revenues of $950 million for the first quarter of 2024, versus $986 million for the same period one year ago. Service revenues totaled ...