United States Cellular Corporation (NYSE:USM) Q4 2023 Earnings Conference Call February 16, 2024 10:00 AM ET Company Participants Colleen Thompson - VP, Corporate Relations Vicki Villacrez - EVP & CFO Laurent Therivel - President, CEO & Director Douglas Chambers - EVP, CFO and Treasurer Michelle Brukwicki - CFO, TDS Telecommunications LLC Conference Call Participants Richard Prentiss - Raymond James Simon Flannery - Morgan Stanley Michael Rollins - Citigroup Sergey Dluzhevskiy - GAMCO Investors Operator Goo ...

Customer Connections and Performance - UScellular serves 4.6 million retail connections, including 4.1 million postpaid and 0.5 million prepaid connections, operating in 21 states with 4,300 employees and 4,373 owned towers[138] - Total postpaid connections decreased from 4,247,000 in 2022 to 4,106,000 in 2023, while prepaid connections decreased from 493,000 to 451,000[143] - Postpaid ARPU increased by 2% to $51.01 in 2023, driven by favorable plan and product mix, while Postpaid ARPA remained flat at $130.91[146] - Postpaid handset net losses increased by 32% to 145,000 in 2023, primarily due to aggressive industry-wide competition and lower gross additions[144] - UScellular served 4.6 million retail connections as of December 31, 2023[269] Financial Performance and Revenues - Total operating revenues decreased by 6% to $3,906 million in 2023, with retail service revenues declining by 2% to $2,742 million and equipment sales revenues dropping by 17% to $862 million[149] - Net income increased by 67% to $58 million in 2023, with Adjusted OIBDA and Adjusted EBITDA growing by 4% and 3% to $818 million and $986 million, respectively[149] - Net income attributable to UScellular shareholders increased by 80% to $54 million in 2023, compared to $30 million in 2022[162] - Total operating revenues decreased to $3,906 million in 2023 from $4,169 million in 2022, a decline of 6.3%[250] - Net income attributable to UScellular shareholders increased to $54 million in 2023 from $30 million in 2022, an 80% increase[250] - Net income attributable to UScellular shareholders rose to $54 million in 2023 from $30 million in 2022, with diluted earnings per share of $0.63[340] Capital Expenditures and Investments - Capital expenditures decreased by 15% to $611 million in 2023, reflecting reduced spending on network infrastructure[149] - UScellular's capital expenditures for 2024 are expected to range between $550 million and $650 million, primarily for network upgrades and 5G deployment[192] - Cash flows used for investing activities in 2023 totaled $721 million, including $608 million for property, plant, and equipment, and $130 million for wireless spectrum licenses[201] - Cash paid for additions to property, plant and equipment was $608 million in 2023, slightly higher than $602 million in 2022[252] - UScellular's free cash flow for 2023 is $192 million, compared to $208 million in 2022, calculated as cash flows from operating activities ($866 million) minus cash paid for property, plant, and equipment ($608 million) and software license agreements ($66 million)[245] Strategic Alternatives and Expenses - UScellular incurred $8 million in third-party expenses related to exploring strategic alternatives, with potential financial impacts still uncertain[140] - Selling, general, and administrative expenses decreased in 2023, primarily due to lower bad debts, commissions, facilities, and employee-related expenses, partially offset by higher advertising expenses and $8 million in strategic alternatives review costs[160] - UScellular incurred third-party expenses of $8 million in 2023 related to the strategic alternatives review[302] - UScellular is exploring strategic alternatives, but there is no assurance that these efforts will result in additional value for shareholders or avoid adverse impacts on its business[235] Network and Spectrum Deployment - The company continued its 5G deployment, focusing on mid-band spectrum to enhance speed and capacity for mobility and fixed wireless services[141] - UScellular was the provisional winning bidder for 254 wireless spectrum licenses in Auction 107 for $1,283 million, with $30 million paid in 2020 and the remainder in March 2021[226] - UScellular was the provisional winning bidder for 380 wireless spectrum licenses in Auction 110 for $580 million, with $20 million paid in 2021 and the remainder in the first quarter of 2022[227] - UScellular was the provisional winning bidder for 34 wireless spectrum licenses in Auction 108 for $3 million, with licenses granted by the FCC on December 1, 2022[228] - UScellular acquired 380 wireless spectrum licenses in the 3.45-3.55 GHz band for $580 million in Auction 110, with payments completed in 2022[343] Expenses and Cost Management - System operations expenses decreased in 2023, primarily due to lower roaming and customer usage expenses, partially offset by higher maintenance, utility, and cell site expenses[158] - Cost of equipment sold decreased in 2023, driven by a decline in smartphone upgrades and gross additions, partially offset by a higher average cost per unit sold[159] - Depreciation, amortization, and accretion expenses decreased in 2023 due to enhancements extending the useful life of a software platform[161] - Depreciation and amortization expense for 2023 was $637 million, down from $682 million in 2022[346] - Implementation costs for cloud-hosted arrangements were $24 million in 2023, down from $42 million in 2022, with amortization costs of $17 million in 2023[278] Debt and Financial Obligations - Interest expense increased by 21% to $196 million in 2023, driven by higher interest rates on variable rate debt[164] - UScellular had $600 million in available undrawn borrowing capacity as of December 31, 2023, including $300 million under a revolving credit agreement[173][174] - UScellular's credit ratings as of December 31, 2023, were Ba1 (Moody's), BB (Standard & Poor's), and BB+ (Fitch Ratings), with a stable outlook from Moody's and Fitch[187] - UScellular repaid $50 million under its receivables securitization agreement in January 2024[178] - UScellular's long-term debt as of December 31, 2023, is $2.98 billion, with 70% in fixed-rate senior notes and 30% in variable-rate debt[236] - The weighted average interest rate on UScellular's long-term debt is 6.4%, with principal payments due in 2024 at $20 million (7.1%) and in 2028 at $286 million (7.5%)[237] - The estimated fair value of UScellular's long-term debt obligations at December 31, 2023, is $2.611 billion, compared to a book value of $3.099 billion[238] - UScellular has a total maximum borrowing capacity of $800 million across three term loans, with $783 million borrowed and outstanding as of December 31, 2023[361] - The company has a $150 million term loan credit facility with Export Development Canada, fully borrowed as of December 31, 2023, bearing interest at SOFR plus 1.60%[362] Cash Flow and Liquidity - UScellular's cash, cash equivalents, and restricted cash decreased by $129 million in 2023, with net cash provided by operating activities at $866 million[200] - Cash flows used for financing activities in 2023 were $274 million, primarily due to repayments of $440 million on the receivables securitization agreement[202] - Net cash provided by operating activities increased to $866 million in 2023 from $832 million in 2022, a 4.1% increase[252] - Cash and cash equivalents decreased from $273 million in 2022 to $150 million in 2023, while restricted cash decreased from $35 million to $29 million[274] Assets and Liabilities - UScellular's inventory decreased by $62 million in 2023 due to efforts to reduce inventory on hand[208] - The fair value of UScellular's wireless spectrum licenses exceeded the carrying value by 17% in 2023, with no impairment recorded[215] - UScellular's accounts payable, trade decreased by $103 million in 2023 due to the timing of vendor invoice payments related to inventory[209] - UScellular's other current liabilities decreased by $181 million in 2023 due to the payment of Auction 107 relocation fees and repayments on the EIP receivables repurchase agreement[210] - Total assets decreased to $10,750 million in 2023 from $11,119 million in 2022, a 3.3% decline[254] - Long-term debt decreased to $3,044 million in 2023 from $3,187 million in 2022, a 4.5% reduction[257] - UScellular shareholders' equity increased to $4,626 million in 2023 from $4,554 million in 2022, a 1.6% increase[257] - Inventory decreased to $199 million in 2023 from $261 million in 2022, a 23.8% reduction[254] - Accounts receivable decreased to $900 million in 2023 from $985 million in 2022, an 8.6% decline[254] - Total current liabilities decreased to $901 million in 2023 from $1,195 million in 2022, a 24.6% reduction[257] - UScellular's total equity increased from $4,554 million in 2022 to $4,626 million in 2023, reflecting a net income attributable to UScellular shareholders of $54 million[259] - Property, plant, and equipment, net, decreased slightly to $2.576 billion in 2023 from $2.624 billion in 2022, with gross assets of $9.560 billion[346] Leasing and Real Estate - Total lease costs for 2023 were $203 million, including $191 million in operating lease costs and $12 million in variable lease costs[351] - Operating cash flows from operating leases increased to $194 million in 2023, up from $185 million in 2022 and $183 million in 2021[352] - Right-of-use assets obtained in exchange for lease obligations were $158 million in 2023, compared to $113 million in 2022 and $182 million in 2021[352] - Weighted average remaining lease term increased to 13 years in 2023 from 12 years in 2022, with a weighted average discount rate of 4.3% in 2023, up from 3.9% in 2022[352] - Total lease payments for operating leases amount to $1,340 million, with a present value of lease liabilities at $966 million after deducting imputed interest of $374 million[352] - Variable lease income from operating leases reached $101 million in 2023, up from $93 million in 2022 and $83 million in 2021[355] - Total future lease maturities expected to be received amount to $282 million, with $80 million due in 2024[356] - Legally binding lease payments for leases signed but not yet commenced total $28 million, excluded from total lease payments[352] - Asset retirement obligations are associated with leased cell sites, switching office sites, retail store sites, and office locations, included in Other deferred liabilities and credits[357] Revenue Recognition and Contract Liabilities - Contract assets were $4 million as of December 31, 2023, compared to $5 million in 2022[318] - Contract liabilities were $331 million as of December 31, 2023, compared to $349 million in 2022[318] - Revenue recognized related to contract liabilities existing at January 1, 2023, was $220 million for the year ended December 31, 2023[318] - Contract cost asset balance related to commission fees and other costs was $127 million at December 31, 2023, compared to $131 million in 2022[321] Equipment Installment Plans and Credit Losses - Equipment installment plan receivables, net, were $1,061 million as of December 31, 2023, compared to $1,115 million in 2022[329] - Equipment installment plan receivables totaled $1.151 billion as of December 31, 2023, compared to $1.211 billion in 2022, with the majority classified as "Lowest Risk" ($1.024 billion in 2023 vs. $1.070 billion in 2022)[330] - Write-offs, net of recoveries, for equipment installment plan receivables amounted to $75 million in 2023, with $45 million originating from 2022[330] - The allowance for credit losses decreased to $90 million at the end of 2023 from $96 million in 2022, with bad debts expense of $69 million in 2023[331] Taxes and Deferred Tax Liabilities - Total income tax expense for 2023 was $53 million, up from $37 million in 2022, with a federal deferred tax expense of $28 million[332] - UScellular's net deferred income tax liability increased to $755 million in 2023 from $708 million in 2022, driven by deferred tax assets of $669 million and liabilities of $1.278 billion[333] Advertising and Employee Benefits - Advertising costs totaled $181 million in 2023, $171 million in 2022, and $184 million in 2021[295] - Pension costs were $11 million in 2023, $12 million in 2022, and $12 million in 2021[300] - Total costs for UScellular's contributions to the 401(k) plan were $15 million for each of 2023, 2022, and 2021[301] Risks and Challenges - UScellular faces risks from intense competition, changes in roaming practices, and potential declines in roaming revenues, which could adversely affect its business and financial condition[231] - The company's inability to attract and retain diverse talent could negatively impact its operations and financial performance[231] - UScellular's smaller scale compared to larger competitors may hinder its ability to compete effectively, potentially affecting its financial results[231] - The company's reliance on the U.S. wireless telecommunications industry makes its operating results susceptible to fluctuations in this sector[235] Miscellaneous - Amounts collected from customers and remitted to governmental authorities totaled $63 million in 2023, $61 million in 2022, and $66 million in 2021[312] - UScellular's wireless spectrum licenses are considered indefinite-lived intangible assets, with no impairment identified as of the latest assessment[279]

United States Cellular Corporation (NYSE:USM) Q3 2023 Earnings Conference Call November 3, 2023 10:00 AM ET Company Participants Colleen Thompson - VP, Corporate Relations Vicki Villacrez - SVP, Finance & CFO, TDS Telecommunications Corporation Laurent Therivel - President, CEO & Director Douglas Chambers - EVP, CFO and Treasurer Michelle Brukwicki - CFO, TDS Telecommunications LLC Conference Call Participants Richard Prentiss - Raymond James & Associates Philip Cusick - JPMorgan Chase & Co. Simon Flannery ...

Part I. Financial Information [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) UScellular's Q3 2023 operating income improved to **$57 million** from a loss, despite an 11% revenue drop, due to a 17% expense reduction, as it explores strategic alternatives [Executive Overview](index=3&type=section&id=Executive%20Overview) UScellular, serving 4.6 million connections, focuses on 5G network enhancement and customer service, while exploring strategic alternatives incurring **$3 million** in Q3 2023 expenses - On August 4, 2023, TDS and UScellular announced the initiation of a process to explore strategic alternatives for UScellular, incurring third-party expenses of **$3 million** in Q3 2023 related to this review[15](index=15&type=chunk) - The company's core strategy involves attracting and retaining customers through a high-quality network, customer service, and competitive pricing. Key strategic efforts include[16](index=16&type=chunk) - Increasing revenues from device protection plans, fixed wireless, prepaid plans, and tower rentals - Continuing to invest in 5G, with a focus on deploying mid-band spectrum to enhance speed and capacity for mobility and fixed wireless services Company Operations Snapshot | Metric | Value | | :--- | :--- | | Retail Connections | 4.6 million | | Postpaid Connections | ~4.2 million | | Prepaid Connections | ~0.5 million | | States of Operation | 21 | | Employees | ~4,500 | | Owned Towers | 4,356 | | Cell Sites in Service | 6,973 | [Operational Overview](index=7&type=section&id=Operational%20Overview) Retail connections decreased to 4.62 million, with postpaid net losses of 35,000, though connected device additions improved and postpaid ARPU grew **2%** to **$51.11** Retail Connections (End of Period) | Category | Sep 30, 2023 | Sep 30, 2022 | | :--- | :--- | :--- | | Postpaid | 4,159,000 | 4,264,000 | | Prepaid | 462,000 | 493,000 | | **Total** | **4,621,000** | **4,757,000** | Postpaid Activity (Q3 2023 vs Q3 2022) | Metric | Q3 2023 | Q3 2022 | % Change | | :--- | :--- | :--- | :--- | | **Total Gross Additions** | 128,000 | 151,000 | (15)% | | Handset Net Losses | (38,000) | (22,000) | (73)% | | Connected Device Net Additions | 3,000 | (9,000) | N/M | | **Total Net Losses** | (35,000) | (31,000) | (13)% | | **Total Churn** | 1.30% | 1.42% | - | - Postpaid handset net losses increased due to aggressive industry-wide competition, while connected device net additions improved due to higher demand for fixed wireless home internet and lower churn for tablets and hotspots[19](index=19&type=chunk)[20](index=20&type=chunk) Postpaid Revenue Metrics (Q3 2023 vs Q3 2022) | Metric | Q3 2023 | Q3 2022 | % Change | | :--- | :--- | :--- | :--- | | ARPU | $51.11 | $50.21 | 2% | | ARPA | $130.91 | $130.27 | — | [Financial Overview](index=8&type=section&id=Financial%20Overview) Q3 2023 revenues decreased **11%** to **$963 million**, but expenses fell **17%** to **$906 million**, leading to **$57 million** operating income and **$23 million** net income Financial Highlights (Three Months Ended Sep 30) | (In millions) | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | Total operating revenues | $963 | $1,083 | (11)% | | Total operating expenses | $906 | $1,098 | (17)% | | **Operating income (loss)** | **$57** | **($15)** | **N/M** | | **Net income (loss)** | **$23** | **($12)** | **N/M** | | Adjusted OIBDA (Non-GAAP) | $220 | $163 | 35% | | Adjusted EBITDA (Non-GAAP) | $263 | $205 | 28% | - The decrease in total operating revenues was primarily driven by a decline in smartphone upgrades and gross additions, leading to lower equipment sales. Service revenues also fell due to a smaller subscriber base and lower inbound roaming rates[28](index=28&type=chunk)[29](index=29&type=chunk) - The decrease in total operating expenses was mainly due to a corresponding decline in the cost of equipment sold, as well as lower bad debts expense, employee-related costs, commissions, and advertising[33](index=33&type=chunk)[34](index=34&type=chunk) - Interest expense increased by **16%** in Q3 2023 compared to Q3 2022, primarily due to higher interest rates on variable-rate debt[36](index=36&type=chunk)[38](index=38&type=chunk) [Liquidity and Capital Resources](index=13&type=section&id=Liquidity%20and%20Capital%20Resources) UScellular maintains **$745 million** in undrawn borrowing capacity, with 9-month capital expenditures of **$462 million** for 5G, and S&P placed its credit rating on CreditWatch developing Available Undrawn Borrowing Capacity (Sep 30, 2023) | Facility | Capacity (in millions) | | :--- | :--- | | Revolving Credit Agreement | $300 | | Receivables Securitization Agreement | $445 | | **Total Available** | **$745** | - In September 2023, the company amended its receivables securitization agreement to extend the maturity date to September 2025[48](index=48&type=chunk) - Following the August 4, 2023 announcement of a strategic alternatives review, S&P placed UScellular's 'BB' issuer credit rating on CreditWatch with developing implications. In October 2023, Moody's re-affirmed its 'Ba1' rating and stable outlook[54](index=54&type=chunk)[55](index=55&type=chunk) - Full-year 2023 capital expenditures are expected to be between **$600 million** and **$700 million**, focused on 5G deployment, network capacity and coverage enhancement with mid-band spectrum, and IT investments[58](index=58&type=chunk)[62](index=62&type=chunk) [Consolidated Cash Flow Analysis](index=16&type=section&id=Consolidated%20Cash%20Flow%20Analysis) Cash, cash equivalents, and restricted cash decreased by **$123 million**, with **$719 million** from operations, **$464 million** used in investing, and **$378 million** used in financing activities Cash Flow Summary (Nine Months Ended Sep 30, 2023) | (In millions) | Amount | | :--- | :--- | | Net cash provided by operating activities | $719 | | Net cash used in investing activities | ($464) | | Net cash used in financing activities | ($378) | | **Net decrease in cash** | **($123)** | - Operating cash flow of **$719 million** was supported by net income of **$43 million**, non-cash adjustments of **$514 million**, and positive working capital changes of **$65 million**[64](index=64&type=chunk) - Financing activities included **$385 million** in repayments on the receivables securitization agreement and a **$60 million** repayment on the EIP receivables repurchase agreement, partially offset by **$115 million** borrowed under the securitization agreement[65](index=65&type=chunk) [Consolidated Balance Sheet Analysis](index=17&type=section&id=Consolidated%20Balance%20Sheet%20Analysis) Inventory decreased by **$86 million**, accounts payable increased by **$62 million** due to Auction 107 fees, and other current liabilities decreased by **$187 million** - Inventory, net decreased by **$86 million** due to efforts to reduce inventory on hand that was previously elevated for holiday promotions[70](index=70&type=chunk) - Accounts payable — Trade increased by **$62 million**, primarily due to Auction 107 relocation fees invoiced during Q3 2023[71](index=71&type=chunk) - Other current liabilities decreased by **$187 million**, mainly due to a decrease in the short-term accrual for Auction 107 relocation fees and repayments on the EIP receivables repurchase agreement[72](index=72&type=chunk) [Supplemental Information Relating to Non-GAAP Financial Measures](index=18&type=section&id=Supplemental%20Information%20Relating%20to%20Non-GAAP%20Financial%20Measures) UScellular uses non-GAAP measures like EBITDA, Adjusted EBITDA, Adjusted OIBDA, and Free Cash Flow, providing reconciliations to GAAP for performance evaluation Reconciliation of Net Income (Loss) to Adjusted EBITDA and Adjusted OIBDA (Q3 2023) | (In millions) | Q3 2023 | Q3 2022 | | :--- | :--- | :--- | | **Net income (loss) (GAAP)** | **$23** | **($12)** | | Income tax expense (benefit) | $27 | ($3) | | Interest expense | $50 | $42 | | Depreciation, amortization and accretion | $159 | $177 | | **EBITDA (Non-GAAP)** | **$259** | **$204** | | Adjustments | $4 | $1 | | **Adjusted EBITDA (Non-GAAP)** | **$263** | **$205** | | Equity in earnings & Interest/dividend income | ($43) | ($42) | | **Adjusted OIBDA (Non-GAAP)** | **$220** | **$163** | Free Cash Flow Reconciliation (Nine Months Ended Sep 30) | (In millions) | 2023 | 2022 | | :--- | :--- | :--- | | Cash flows from operating activities (GAAP) | $719 | $652 | | Cash paid for additions to property, plant and equipment | ($454) | ($409) | | Cash paid for software license agreements | ($28) | ($5) | | **Free cash flow (Non-GAAP)** | **$237** | **$238** | [Regulatory Matters](index=20&type=section&id=Regulatory%20Matters) UScellular acquired 254 spectrum licenses for **$1.283 billion** in FCC Auction 107, incurring **$179 million** in relocation costs, with the **$9 billion** 5G Fund's impact uncertain - In FCC Auction 107, UScellular was the winning bidder for 254 wireless spectrum licenses for **$1.283 billion**. The company received full access to this spectrum in Q3 2023[82](index=82&type=chunk) - Associated with Auction 107, UScellular is obligated to pay approximately **$179 million** in total relocation costs and incentive payments between 2021 and 2025. In October 2023, the company paid invoices totaling **$105 million** for these costs[82](index=82&type=chunk) - The FCC is proceeding with the 5G Fund for Rural America, which will provide up to **$9 billion** over ten years for 5G deployment. UScellular cannot predict when the auction will occur or how it will impact its existing legacy support from the Federal USF[83](index=83&type=chunk)[84](index=84&type=chunk) [Financial Statements (Unaudited)](index=24&type=section&id=Financial%20Statements%20%28Unaudited%29) Unaudited consolidated financial statements for Q3 2023, including operations, cash flows, balance sheets, and equity, reflect performance trends and key financial positions [Consolidated Statement of Operations](index=24&type=section&id=Consolidated%20Statement%20of%20Operations) Q3 2023 saw **$963 million** in operating revenues, **$57 million** operating income, and **$23 million** net income, a turnaround from a **$12 million** net loss in Q3 2022 Consolidated Statement of Operations (Three Months Ended Sep 30) | (In millions, except per share) | 2023 | 2022 | | :--- | :--- | :--- | | Total operating revenues | $963 | $1,083 | | Total operating expenses | $906 | $1,098 | | **Operating income (loss)** | **$57** | **($15)** | | Income (loss) before income taxes | $50 | ($15) | | **Net income (loss)** | **$23** | **($12)** | | Diluted earnings (loss) per share | $0.26 | ($0.15) | [Consolidated Statement of Cash Flows](index=25&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) Nine months ended September 30, 2023, showed **$719 million** operating cash flow, **$464 million** used in investing, **$378 million** used in financing, resulting in a **$123 million** net cash decrease Consolidated Statement of Cash Flows (Nine Months Ended Sep 30) | (In millions) | 2023 | 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $719 | $652 | | Net cash used in investing activities | ($464) | ($976) | | Net cash provided by (used in) financing activities | ($378) | $414 | | **Net increase (decrease) in cash** | **($123)** | **$90** | | Cash, cash equivalents and restricted cash, end of period | $185 | $289 | [Consolidated Balance Sheet](index=26&type=section&id=Consolidated%20Balance%20Sheet) As of September 30, 2023, total assets were **$10.75 billion**, liabilities **$6.12 billion** (including **$2.90 billion** long-term debt), and equity **$4.62 billion** Consolidated Balance Sheet Highlights | (In millions) | Sep 30, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Total current assets | $1,393 | $1,723 | | Licenses | $4,690 | $4,690 | | Property, plant and equipment, net | $2,593 | $2,624 | | **Total assets** | **$10,749** | **$11,119** | | Total current liabilities | $1,031 | $1,195 | | Long-term debt, net | $2,903 | $3,187 | | **Total liabilities** | **$6,118** | **$6,549** | | **Total equity** | **$4,619** | **$4,570** | [Notes to Consolidated Financial Statements](index=32&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail financial statement support, including revenue, debt, and intangible assets, notably disclosing **$3 million** in strategic review expenses in Q3 2023 - **Note 1:** The company incurred **$3 million** in third-party expenses during Q3 2023 related to the strategic alternatives review initiated on August 4, 2023[129](index=129&type=chunk) - **Note 4:** Net equipment installment plan receivables were **$1.04 billion** as of September 30, 2023, down from **$1.12 billion** at year-end 2022[145](index=145&type=chunk) - **Note 9:** The receivables securitization agreement was extended to September 2025. As of September 30, 2023, outstanding borrowings were **$5 million** with **$445 million** of unused capacity. Subsequent to the quarter-end, the company borrowed an additional **$150 million** under this facility[155](index=155&type=chunk)[156](index=156&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=23&type=section&id=Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) UScellular faces interest rate risk, with **70%** of its **$3.0 billion** long-term debt fixed-rate and **30%** variable-rate, at a **6.4%** weighted average interest rate - As of September 30, 2023, approximately **70%** of the company's long-term debt was fixed-rate, mitigating interest rate risk on that portion, while **30%** was variable-rate, exposing the company to fluctuations in market interest rates[97](index=97&type=chunk) Long-Term Debt Principal Payments by Period (as of Sep 30, 2023) | Period | Principal Payments (in millions) | Weighted-Avg. Interest Rate | | :--- | :--- | :--- | | Remainder of 2023 | $3 | 7.2% | | 2024 | $20 | 7.1% | | 2025 | $20 | 7.1% | | 2026 | $268 | 6.9% | | 2027 | $158 | 7.0% | | Thereafter | $2,514 | 6.3% | | **Total** | **$2,983** | **6.4%** | Part II. Other Information [Legal Proceedings](index=40&type=section&id=Legal%20Proceedings) UScellular faces an appeal regarding past FCC spectrum auctions and a putative stockholder class action alleging 2022 public statement violations, which it intends to vigorously contest - A case related to UScellular's participation in FCC spectrum auctions 58, 66, 73, and 97, brought by private parties under the False Claims Act, was dismissed in March 2023. The plaintiffs are now appealing this decision[173](index=173&type=chunk) - On May 2, 2023, a putative stockholder class action was filed against TDS and UScellular, alleging that public statements made between May and November 2022 regarding business strategies were in violation of the Securities Exchange Act of 1934[174](index=174&type=chunk) [Risk Factors](index=21&type=section&id=Risk%20Factors) A new risk factor addresses the strategic alternatives review, highlighting potential impacts like management distraction, expenses, personnel loss, and stock price volatility - A new risk factor has been added to address the process of exploring strategic alternatives for UScellular, which was announced on August 4, 2023[94](index=94&type=chunk) - Potential adverse impacts from the strategic review process include: diversion of management's attention, significant expenses, failure to retain key personnel and customers, and stock price volatility[95](index=95&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) UScellular made no common share repurchases in Q3 2023, retaining authorization for **1,926,941** additional shares under its ongoing program - No Common Shares were repurchased by or on behalf of UScellular during the third quarter of 2023[177](index=177&type=chunk) - As of September 30, 2023, the maximum number of shares that may still be purchased under the company's repurchase program is **1,926,941**[177](index=177&type=chunk) [Controls and Procedures](index=40&type=section&id=Controls%20and%20Procedures) As of September 30, 2023, UScellular's disclosure controls and procedures were deemed effective, with no material changes to internal control over financial reporting - The company's management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of September 30, 2023[171](index=171&type=chunk) - No changes occurred during the three months ended September 30, 2023, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[172](index=172&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-09712 UNITED STATES CELLULAR CORPORATION Delaware 62-1147325 8410 West Bryn Mawr, Chicago, Illinois 60631 (Address of principal e ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-09712 The number of shares outstanding of each of the issuer's classes of common stock, as of March 31, 2023, is 51,712,600 Comm ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-09712 UNITED STATES CELLULAR CORPORATION (Exact name of Registrant as specified in its charter) Delaware 62-1147325 (State or other j ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-09712 UNITED STATES CELLULAR CORPORATION (Exact name of Registrant as specified in its charter) (State or other jurisdiction of i ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-09712 UNITED STATES CELLULAR CORPORATION (Exact name of Registrant as specified in its charter) (State or other jurisdiction of ...

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-09712 UNITED STATES CELLULAR CORPORATION (Exact name of Registrant as specified in its charter) UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) Delaware 62-1147325 (State or other j ...