TDS 10-K & 10-Q changes, risk factors and insider trading
Telephone & Data Systems Inc. (also TDS-PU, TDS-PV) · NYSE · Telephone Communications (No Radiotelephone) · CIK 1051512 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “2)Array entered into License Purchase Agreements with Verizon and T-Mobile to sell certain wireless spectrum licenses. There is no guarantee that such transactions contemplated by the License Purchase Agreements will be consummated. Costs and uncertainties related to these transactions could have adverse effects on Array's financial condition or results of operations.”
New heading “3)An inability to monetize the remaining spectrum assets as well as the ongoing costs to retain the spectrum could adversely affect TDS’ operations.”
New heading “6)There are economic and business risks associated with fixed rate annual escalators on Array's colocation revenue contracts.”
New heading “10)TDS’ business, financial condition or results of operations may be adversely impacted by extreme weather events, climate-related events, natural disasters (including wildfires) and other unforeseen events.”
New heading “11)An inability to attract people of outstanding talent throughout all levels of the organization, to develop their potential through education and assignments, and to retain them by keeping them engaged, challenged and properly rewarded could have an adverse effect on TDS' business, financial condition or results of operations.”
Removed heading “2)If the T-Mobile, Verizon and AT&T transactions are not consummated, substantial changes will be required to the manner in which UScellular’s wireless business is conducted, and we expect there will be a material adverse effect on TDS' financial condition and results of operations.”
Removed heading “7)Changes in roaming practices or other factors could cause TDS’ roaming revenues to decline from current levels, roaming expenses to increase from current levels and/or impact TDS’ ability to service its customers in geographic areas where TDS does not have its own network, which could have an adverse effect on TDS’ business, financial condition or results of operations.”
Removed heading “10)A failure by TDS to obtain access to adequate radio spectrum to meet current or anticipated future needs and/or to accurately predict future needs for radio spectrum could have an adverse effect on TDS’ business, financial condition or results of operations.”
Removed heading “12)Complexities associated with deploying new technologies present substantial risk and TDS’ investments in unproven technologies may not produce the benefits that TDS expects.”
Removed heading “17)TDS has a significant amount of indebtedness which could adversely affect its financial performance and in turn adversely affect its ability to make payments on its indebtedness, comply with terms of debt covenants and incur additional debt.”
Removed heading “18)TDS has entered into a Senior Secured Credit Agreement that imposes certain restrictions on its business and operations that may affect its ability to operate its business and make payments on its indebtedness.”
Removed heading “24)The possible development of adverse precedent in litigation or conclusions in professional or environmental studies to the effect that potentially harmful emissions from devices or network equipment, including but not limited to radio frequencies emitted by wireless signals or due to contamination from network cabling, may cause harmful health or environmental consequences, including cancer, tumors or otherwise harmful impacts, or may interfere with various electronic medical devices or frequencies used by other industries, could have an adverse effect on TDS’ wireless and/or wireline business, financial condition or results of operations.”
Removed heading “25)Claims of infringement of intellectual property and proprietary rights of others, primarily involving patent infringement claims, could prevent TDS from using necessary technology to provide products or services or subject TDS to expensive intellectual property litigation or monetary penalties, which could have an adverse effect on TDS’ business, financial condition or results of operations.”
Removed heading “29)The impact of public health emergencies on TDS' business is uncertain, but depending on duration and severity could have a material adverse effect on TDS' business, financial condition or results of operations.”
Largest changes
“TDS’ credit rating currently is sub-investment grade. TDS has incurred negative free cash flow (defined as Cash flows from operating activities less Cash paid for additions to property, plant and equipment and less Cash paid for software license agreements) at times in past periods, and this could occur in future periods. TDS may require substantial additional capital for, among other uses, capital expenditures, acquisitions, investments in new technologies and fiber deployments, the repurchase of shares, and the payment of dividends. …”see in full comparison
“The TDS and UScellular revolving credit agreements, the TDS and UScellular term loan agreements, the TDS and UScellular export credit financing agreements and the UScellular receivables securitization agreement require TDS or UScellular, as applicable, to comply with certain affirmative and negative covenants, including certain financial covenants. Depending on the actual financial performance of TDS and UScellular, there is a risk that TDS and/or UScellular could fail to satisfy the required financial covenants. This risk has increased with TDS' recent financial and operating performance. …”see in full comparison
“25)Claims of infringement of intellectual property and proprietary rights of others, primarily involving patent infringement claims, could prevent TDS from using necessary technology to provide products or services or subject TDS to expensive intellectual property litigation or monetary penalties, which could have an adverse effect on TDS’ business, financial condition or results of operations.”see in full comparison
“24)The possible development of adverse precedent in litigation or conclusions in professional or environmental studies to the effect that potentially harmful emissions from devices or network equipment, including but not limited to radio frequencies emitted by wireless signals or due to contamination from network cabling, may cause harmful health or environmental consequences, including cancer, tumors or otherwise harmful impacts, or may interfere with various electronic medical devices or frequencies used by other industries, could have an adverse effect on TDS’ wireless and/or wireline …”see in full comparison
“Media reports and certain professional studies have suggested that certain potentially harmful emissions from devices or network equipment, including but not limited to radio frequencies emitted by wireless signals or due to contamination from network cabling, may cause harmful health or environmental consequences, including cancer, tumors or otherwise harmful impacts, and may interfere with various electronic medical devices, including hearing aids and pacemakers. …”see in full comparison
“The Senior Secured Credit Agreement includes representations and warranties, covenants, events of default and other terms and conditions that are substantially similar to TDS’ existing term loan and revolving credit agreements. Under the Senior Secured Credit Agreement, TDS is required to comply with certain financial covenants. Depending on the actual financial performance of TDS, there is a risk that TDS could fail to satisfy the required financial covenants. …”see in full comparison
Full comparison: every changed paragraph (171)
1)TDS and UScellular entered into a Securities Purchase Agreement dated as of May 24, 2024 with T-Mobile and USCC Wireless Holdings, LLC, pursuant to which, among other things, UScellular has agreed to sell its wireless operations and select spectrum assets to T-Mobile. In addition, UScellular, and certain subsidiaries of UScellular, entered into the Verizon Purchase Agreement on October 17, 2024, and the AT&T Purchase Agreement on November 6, 2024 to sell certain wireless spectrum licenses. There is no guarantee that the transactions contemplated by the Securities Purchase Agreement, the Verizon Purchase Agreement, or the AT&T Purchase Agreement will be able to be consummated or that UScellular will be able to find buyers at mutually agreeable prices for its spectrum assets not subject to the Securities Purchase Agreement, the Verizon Purchase Agreement, or the AT&T Purchase Agreement. Costs and uncertainties related to the transactions could have adverse effects on TDS’ financial condition or results of operations.
On August 4, 2023, TDS and UScellular announced that the Boards of Directors of both companies decided to initiate a process to explore a range of strategic alternatives for UScellular. As part of this review, on May 28, 2024, UScellular announced that its Board of Directors unanimously approved the execution of the Securities Purchase Agreement pursuant to which, among other things, UScellular has agreed to sell its wireless operations and select spectrum assets to T-Mobile. The Securities Purchase Agreement also contemplates, among other things, a Short-Term Spectrum Manager Lease Agreement and Short-Term Spectrum Manager Sublease Agreements that will become effective at the closing date, which provide T-Mobile with an exclusive license to use certain UScellular spectrum assets and leases at no cost for up to one-year for the purpose of providing continued, uninterrupted service to customers.
On October 17, 2024, UScellular, and certain subsidiaries of UScellular, entered into the Verizon Purchase Agreement to sell certain AWS, Cellular and PCS wireless spectrum licenses and agreed to grant Verizon certain rights to lease such licenses prior to the transaction close.
On November 6, 2024, UScellular, and certain subsidiaries of UScellular, entered into the AT&T Purchase Agreement to sell certain 3.45 GHz and 700 MHz wireless spectrum licenses and agreed to grant AT&T certain rights to lease and sub-lease such licenses prior to the transaction close.
The transactions resulting from the strategic alternatives review are subject to regulatory approval, which UScellular may not be able to obtain on the terms or timeline currently contemplated, or at all. Similarly, UScellular may not be able to satisfy the other closing conditions applicable to each of the transactions, which in the case of the Verizon and AT&T transactions include the closing of the T-Mobile transaction and, for the Verizon transaction, the termination of the T-Mobile Short-Term Spectrum Manager Lease Agreement. The T-Mobile and AT&T transactions include certain wireless spectrum licenses that are held by entities in which UScellular is a non-controlling limited partner. The closing with respect to these wireless spectrum licenses is contingent upon UScellular's purchase, which is pending receipt of regulatory approval, of the remaining equity in the entities that UScellular does not currently own.
The uncertainty regarding the transactions and continued strategic alternatives review process could result in: a diversion of management's attention from UScellular's existing business; a failure to achieve financial and operating objectives; adverse effects on TDS' financial condition or results of operations; a failure to retain key personnel, customers, business partners or contracts; and volatility in TDS' and UScellular's stock price.
The strategic alternatives review process has already resulted in the incurrence of significant expense primarily related to legal and financial advisors - this is expected to continue. Further, as a result of changes to its spectrum units of accounting, UScellular recognized a significant impairment on its spectrum assets during 2024 and there may be further events and circumstances that occur which may result in additional impairments for the spectrum that is retained, or for the spectrum that is pending sale if such sales do not close as expected.
There can be no assurance that the strategic alternatives review process, which is ongoing, will result in the transactions or any strategic alternative of any kind being successfully completed or that the process or any outcomes of the process will not have an adverse impact on UScellular's business or financial statements. In addition, UScellular may be unable to find buyers at mutually agreeable prices for its spectrum assets not subject to the recent transactions, including the Securities Purchase Agreement, the Verizon Purchase Agreement, or the AT&T Purchase Agreement.
See Note 7 — Divestitures in the Notes to Consolidated Financial Statements for additional information related to the T-Mobile, Verizon and AT&T transactions, including the uncertainty related to certain portions of the transaction proceeds.
2)If the T-Mobile, Verizon and AT&T transactions are not consummated, substantial changes will be required to the manner in which UScellular’s wireless business is conducted, and we expect there will be a material adverse effect on TDS' financial condition and results of operations.
If the T-Mobile, Verizon and AT&T transactions are not consummated, UScellular would continue to operate its wireless business in an environment of intensifying competitive pressures and limited capital resources. In that scenario, UScellular would be required to develop and implement new strategic plans. The continued operation of the wireless business with its lack of scale and structural disadvantages under these conditions will result in a material adverse effect on TDS' customers, financial condition and results of operations.
In addition, if the T-Mobile, Verizon and AT&T transactions are not consummated, the funds contemplated to be received as a result of such transactions would not be available for investment in other UScellular businesses, repayment of debt or the payment of dividends to UScellular stockholders, including TDS. TDS, in turn, would not have access to any such dividend payments, if and as declared by the UScellular Board of Directors, for investment in its other businesses, repayment of debt or other corporate purposes.
Further, if the T-Mobile, Verizon and AT&T transactions are not consummated, the stock price of TDS and UScellular likely would decline to the extent that the current market price reflects an assumption that the transactions will be completed.
31)IfClosing of the T-Mobile,T-Mobile Verizontransaction occurred on August 1, 2025, and AT&Thas transactions are consummated, substantial costs will be triggered andrequired substantial changes will be required to the manner in which UScellular’sArray’s remaining business is conducted, which could have a material adverse effect on TDS'Array's financial condition and results of operations.
The successful consummation of the T-Mobile, Verizon and AT&T transactions will trigger substantial costs and require significant changes to the manner in which the UScellular business is operated. In addition, UScellular would, following the closing of the T-Mobile, Verizon and AT&T transactions, be subject to certain business risks that it does not currently face.
In terms of costs, UScellular expects that the closing of the transaction will trigger or accelerate the recognition of certain cash and non-cash obligations. Such obligations include contingent advisory fees, employee compensation and severance, employee stock award costs, debt extinguishment, income tax expense, administrative costs, restructuring expenses and other wind down costs. Additionally, following the close of the T-Mobile transaction, it is uncertain which towers T-Mobile will choose to locate on, and therefore, it is unknown how many and which towers with no tenants will remain in UScellular's tower portfolio. UScellular expects to incur significant decommissioning costs for certain towers that UScellular elects to retire, and such decommissioning costs are also expected to include remaining obligations under related ground leases. These costs are expected to have a significant impact on TDS' cash flows and financial statements.
IfThe successful closing of the transactionsT-Mobile fromtransaction on August 1, 2025 has required significant changes to the strategicmanner alternativesin process are successfully completed,which the Array business is operated. The remaining UScellularArray business, which includes the tower business, non-controlling interests in certain non-operatingwireless equityoperating method investmentscompanies and wireless spectrum licenseslicenses, notcertain includedof inwhich theare announcedsubject transactions,to willother besale agreements, is of a significantly smaller scale than its currenthistorical operations. This could produce operational, cost and borrowing disadvantages relative to its currenthistorical operations.
Upon receipt of regulatory approval, TDS and Array accelerated the recognition of certain cash and non-cash obligations related to employee compensation, severance and stock awards. Additional significant costs that include contingent advisory fees, income tax expense, administrative costs, restructuring expenses and other wind down costs were recorded upon and following the close on August 1, 2025. Significant additional transaction costs related to pending and potential future spectrum sales, ongoing restructuring expenses and wind down costs have been incurred and are expected to be incurred into the foreseeable future as the strategic alternatives process is completed. Additionally, it is uncertain which towers T-Mobile will choose to permanently locate on, and therefore, it is unknown how many and which towers with no tenants will remain in Array's tower portfolio. Array may incur significant decommissioning costs for certain towers that Array elects to retire, and such decommissioning costs are also expected to include remaining obligations under related ground leases for certain towers. These decommissioning costs may have a significant adverse impact on TDS’ future cash flows and financial results.
At the closing of the T-Mobile closing,transaction, UScellularArray and T-Mobile will enterentered into a Master License Agreement,MLA, pursuant to which, among other things, T-Mobile will lease space on certain additional UScellular-ownedArray-owned towers for a minimum of 15 years and extendalso thecommit termto 15 year minimum extensions of certain existing leases tofor 15Array-owned years.towers. IfAs a result, Array’s business is substantially dependent upon T-Mobile, and if T-Mobile fails to meet its obligations under these leases to UScellular,Array, itthis would likely have ana significant adverse impact on TDS'TDS’ business and financial statements.results.
In addition, if the transactions are successfully completed, UScellular will retain certain wireless spectrum licenses with FCC build-out requirements that have not yet been satisfied. Such licenses would require significant investments to deploy and if the sale of its wireless operations is completed, UScellular would no longer have an existing wireless business to operate the retained spectrum. Additionally, if the T-Mobile transaction is successfully completed, but the Verizon and AT&T transactions are not completed, UScellular would retain additional wireless spectrum licenses with no existing wireless business to operate the spectrum. As renewal of all wireless spectrum licenses is predicated upon their initial and continued operation in accordance with FCC requirements, such licenses could be subject to forfeiture should UScellular not incur significant expenses to operate the spectrum or engage another carrier to do so. Further, UScellular could fail to monetize remaining spectrum assets including the wireless spectrum licenses that are subject to a Put/Call Agreement with T-Mobile as it is uncertain if the call option will be exercised or if the conditions required to exercise the put option will occur. All of these events could have a significant adverse effect on TDS' financial condition and results of operation.
See Note 2 — Discontinued Operations and Note 7 — Acquisitions and Divestitures in the Notes to Consolidated Financial Statements for additional information related to the Put/Call Agreement.information.
2)Array entered into License Purchase Agreements with Verizon and T-Mobile to sell certain wireless spectrum licenses. There is no guarantee that such transactions contemplated by the License Purchase Agreements will be consummated. Costs and uncertainties related to these transactions could have adverse effects on Array's financial condition or results of operations.
On October 17, 2024, Array entered into the Verizon License Purchase Agreement to sell certain AWS, Cellular and PCS wireless spectrum licenses and agreed to grant Verizon certain rights to lease such licenses prior to the transaction close.
On August 29, 2025, Array entered into the T-Mobile License Purchase Agreement to sell certain 700 MHz wireless spectrum licenses and agreed to grant T-Mobile certain rights to lease such licenses prior to the transaction close.
On September 22, 2025, T-Mobile exercised its call option under the Put/Call Agreement for certain 600 MHz wireless spectrum licenses and on October 7, 2025, Array and T-Mobile entered into a License Purchase Agreement.
The Verizon and T-Mobile spectrum transactions are subject to regulatory approval, which Array may not be able to obtain on the terms or timeline currently contemplated, or at all. Similarly, Array may not be able to satisfy the other closing conditions applicable to each of the transactions, which in the case of the Verizon transaction, includes the termination of the T-Mobile Short-Term Spectrum Manager Lease Agreement. If the Verizon and T-Mobile spectrum transactions are not consummated, the funds contemplated to be received as a result of such transactions will not be available for investment in Array’s business, repayment of debt, or dividends to Array stockholders, including TDS. Further, TDS’ and Array’s stock price may decline to the extent that the current market price reflects an assumption that these transactions will be completed. The uncertainty regarding the Verizon and T-Mobile spectrum transactions and the continued efforts to monetize the remaining spectrum assets could result in adverse effects on TDS’ financial condition or results of operations and volatility in TDS’ and Array's stock price.
The strategic alternatives review process has already resulted in the incurrence of significant expense primarily related to legal and financial advisors - this is expected to continue. Further, as a result of changes to its spectrum units of accounting, Array recognized significant impairments on its spectrum assets during 2024 and 2025 and further events and circumstances may result in additional impairments for the remaining spectrum assets, including the spectrum that is pending sale if such sales do not close as expected.
There can be no assurance that the strategic alternatives review process, which is ongoing, will result in the spectrum transactions with Verizon and T-Mobile being successfully completed, or the successful monetization of other remaining spectrum, or that these processes or any outcomes of these processes will not have an adverse impact on TDS’ business or financial statements.
See Note 7 — Acquisitions and Divestitures in the Notes to Consolidated Financial Statements for additional information related to the Verizon and T-Mobile spectrum transactions.
3)An inability to monetize the remaining spectrum assets as well as the ongoing costs to retain the spectrum could adversely affect TDS’ operations.
Array may be unable to find buyers at mutually agreeable prices for its spectrum assets not subject to the pending Verizon and T-Mobile transactions. Further, the opportunity to monetize the remaining spectrum assets will depend on a variety of factors, including industry data usage, availability of new spectrum through FCC spectrum auctions and the potential disposition of other wireless businesses.
In addition, most of the remaining spectrum licenses not subject to the Verizon and T-Mobile spectrum transactions have FCC build-out requirements that have not yet been fully satisfied. Compliance with such requirements would drive significant investments and Array no longer has an existing wireless business to operate the retained spectrum. Additionally, if the Verizon and T-Mobile spectrum transactions are not completed, Array would retain additional wireless spectrum licenses with no wireless business to operate the spectrum. As renewal of all wireless spectrum licenses is predicated upon their initial and continued operation in accordance with FCC requirements, such licenses could be subject to forfeiture if Array does not incur significant costs and expenses to operate the spectrum prior to renewal or engage another carrier to do so. All of these events could decrease the value of retained spectrum and could have a significant adverse effect on TDS’ financial condition, cash flows, and results of operations.
4)A delay or failure by TDS to complete significant network construction and systems implementation activities as part of its plans to expand and improve the quality, coverage, capabilitiesquality and capacity of its network,network and support and other systems and infrastructure as well as renew wireless spectrum licenses, could adversely affect its operations.
TDS’ business plan includes significant construction activities and enhancements to its network, support and other systems and infrastructure. As TDS continues to build out and enhance its network, TDS must, among other things, continue to:
TDS’ business plan includes significant construction activities and enhancements to its network, support and other systems and infrastructure. TDS also has the obligation to continue to maintain operation of wireless spectrum licenses that are currently deployed, as well as, FCC build-out requirements for certain wireless spectrum licenses that have not yet been satisfied. Such licenses require significant investments to deploy and the incurrence of ongoing network expenses to operate, as renewal of all wireless spectrum licenses is predicated upon their initial and continued operation in accordance with FCC requirements. Failure to continue to operate a wireless spectrum license or failure to initiate the operation of a spectrum license by the respective FCC build-out deadline could result in forfeiture of such license which could have a material adverse effect on TDS' business, financial condition or results of operations. Additionally, the deployment of new wireless technologies, including the continued deployment of 5G, will require substantial investments in TDS' wireless network. Also, as TDS continues to build out and enhance its network, TDS must, among other things, continue to:
▪Lease, acquire or otherwise obtain rights to cell and switch sites, transport facilities or other facilities;
▪Obtain zoning variances or other local governmental or third-party approvals or permits for network construction; and
▪Complete and update the radio frequency design, including cell site design, frequency planning and network optimization, for each of TDS’ wireless markets; and
Any difficulties encountered in completing these activities, as well as problems in vendor equipment availability, labor availability, inflation or other pressures on costs, technical resources, system performance or system adequacy, could delay implementation and deployment of new technologies, delay expansion of operations and product capabilities in new or existing markets or result in increased costs. Failure to successfully deploy new technologies, including the continued deployment of 5G, and/or build-out and enhance TDS’ network, support facilities and other systems and infrastructure in a cost-effective manner, and in a manner that satisfies consumers' expectations for quality and coverage, has adversely affected and could continue to adversely affect TDS’ business, business prospects, financial condition or results of operations.
TDS’ wireline andbusiness cable businesses areis devoting a substantial amount of capital for fiber builds in its markets using a combination of internal and third-party construction crews. TDS is also often reliant on third parties for items such as franchises, utility locates and easements, aerial attachments and other permits. Difficulties with third-party performance could cause delays or additional costs. Any difficulties in supplySupply chain constraints, labor shortages, project management, engineering or construction resources, or difficulties in project management, engineering, construction resources or build activities, including inadvertently damaging other utility lines or pipes, could delay construction and expansion of operations, cause reputational harm or result in increased costs. Continued delays, incremental delaysDelays or failure to complete its deployment activities could weaken TDS' competitive position in certain of its markets, causing TDS to modify its deployment plans or write-off investments, which could have an adverse effect on TDS’ business, business prospects, financial condition or results of operations.
5)IntenseIncreasing competition involvingin products,the services, pricing, promotionswireline and networktower speed and technologiesindustries could adversely affect TDS’ revenuesrevenues, ornegatively impact future growth and increase its costs to compete.
Competition in the wireless industry is intense and is expected to increase in intensity into the foreseeable future due to multiple factors such as increasing market penetration, introduction of new products, new competitors, increasing promotional aggressiveness and changing prices. There is competition in service plan pricing; handsets and other devices; promotional discounts; network quality, coverage, speed and technologies, including 5G technology; distribution; new entrants; bundled services, such as home internet and wireless; and other categories. In particular, wireless competition includes aggressive service plan and device pricing, including pricing for unlimited plans, which could result in switching activity and churn and limit TDS’ ability to monetize future growth in data usage. In addition, competition based on network speed may increase as customer demand for higher speeds increases. These competitive factors have and are expected to continue to result in losses of retail connections, may cause the prices for certain services and products to decline and the costs to compete to increase.
TDS’ wireless competitors include national or global telecommunications and cable wireless companies that are larger than TDS, possess greater financial and other resources, possess more extensive coverage areas and more spectrum within their coverage areas, and market other services with their communications services that TDS does not offer. TDS and its competitors are actively marketing their deployment of 5G and, as a result, continue to raise consumer awareness of the technology. If TDS continues to not keep pace with its competitors in deploying 5G or other comparable offerings, or if TDS' deployment of 5G technology does not result in significant incremental revenues, TDS' financial condition, results of operations and ability to do business could continue to be adversely affected. In addition, new technologies, services and products that are more commercially effective than the technologies, services and products offered by TDS may be developed and create new sources of competition. Further, new technologies may be proprietary such that TDS is not able to adopt such technologies. There can be no assurance that TDS will be able to compete successfully in this environment.
Sources of competition to TDS’ wireless business typically include at least four competing wireless telecommunications service providers across TDS' service area, wireline telecommunications service providers, cable wireless companies, resellers (including MVNOs), and providers of alternative telecommunications services. In particular, competition from cable wireless companies has increased in recent periods and is expected to increase into the foreseeable future, as they have continued to expand their presence in the wireless industry and have offered more competitive pricing. Many of TDS’ wireless and other competitors have substantially greater financial, technical, marketing, sales, purchasing and distribution resources than TDS.
Competition in the tower industry is also challenging, as TDS competes with public and private tower companies, private equity sponsored tower companies, and owners of non-communications sites such as utility towers, rooftop structures, water towers, and other alternative structures. Many of these competitors are larger than TDS, have greater financial and other resources, have more advantageous tower locations than TDS, have greater capacity on their towers, and have more scale and coverage nationwide than TDS – such factors could result in an inability to acquire or build additional towers, difficulty in leasing tower space or renewing leases, or cause lease revenue to decline in the future.
Competition in the wireline industry is intensified with the increasing deployment of broadband technologies, MVNO plans offering wireless services, and enhanced video services. Incumbent carriers are upgrading existing networks with higher speed broadband services and overbuilders are deploying broadband to compete with legacy incumbent carriers. Overbuilding activity is increasing with investments by venture capital and private equity and with additional access to state and federal funding. Sources of competition to TDS’ wireline and cable businesses include, but are not limited to, other cable companies, fiber overbuilders, incumbent carriers, wireless communications providers, resellers of local exchange services, interexchange carriers, satellite broadband providers, access providers, VoIP providers and providers using other emerging technologies. Customers may choose to substitute their wireline services using satellite, wireless and other technologies, which may be preferred to technologies offered by TDS. If TDS cannot keep pace with its competition in deploying higher speed technologies, offering competitive products and services at competitive prices and providing attractive video content and wireless mobility options, TDS' financial condition, results of operations or ability to do business could be adversely affected.
TDS’ wireline business introducedoffers MVNO plans offeringproviding wireless services to customers in its service areas. TDS’ MVNO offerings are reliant on third parties to deliver adequate wireless service to these customers and may not be able to successfully compete with wireless options provided by other industry competitors who have access to greater scale and financial resources than TDS. There is no guaranteeassurance that these MVNO plans will attract or retain broadband customers.
Competition in the tower industry is robust, as Array competes with public and private tower companies, private equity sponsored tower companies, and owners of non-communications sites such as utility towers, rooftop structures, water towers, and other alternative structures. Many of these competitors are larger than Array, have greater financial and other resources, have more advantageous tower locations than Array, and have more scale nationwide than Array. Such factors could result in difficulty in leasing tower space or renewing leases, or cause lease revenue to decline in the future. Specifically, Array could be negatively impacted by the following factors, among others:
▪Increased pressure on pricing resulting from increased tenant churn, sustained low tenancy rates or further reductions in such rates;
▪Low profit margins and returns on investment that are below Array’s cost of capital;
▪Limited opportunities for strategic partnerships.
6)There are economic and business risks associated with fixed rate annual escalators on Array's colocation revenue contracts.
A majority of Array's ground leases with its ground lessors, and a majority of Array's colocation contracts with its tenants contain fixed rate annual escalation rates. To the extent average ground lease escalation rates exceed average colocation revenue escalation rates, Array's results of operations, cash flows, and financial condition could be adversely impacted.
Further, to the extent future U.S. inflation rates would persist at higher rates for sustained periods of time, revenues and margins in real dollars could erode, and this could have an adverse affect on Array's results of operations, cash flows and financial condition.
7)A substantial portion of Array revenues are derived from a small number of tenants concentrated in the wireless industry and the loss or financial difficulties of such tenants may adversely affect Array’s business, financial condition, results of operations and future growth. Array is particularly reliant on its relationship with T-Mobile. DISH Wireless has failed to make certain payments due to Array under their contractual commitment. Lower demand for wireless services, negative trends in the wireless industry or changes in customer business models may decrease the revenues Array receives from its tenants, which could adversely affect Array’s business, financial condition, results of operations and future growth.
A substantial portion of Array revenues are derived from a small number of tenants concentrated in the wireless industry including Verizon, AT&T and particularly T-Mobile (collectively, large carriers). As it relates to the large carriers, a reduction in the demand for tower leasing, reduced capital expenditures or operating expenses on networks, financial difficulties, or other business factors at such large carriers, may adversely affect Array’s revenues, results of operations, cash flows, financial condition, liquidity and future growth. If the large carriers or other current or potential tenants are unable to raise adequate capital to fund their business plans or encounter capital constraints, they may reduce spending; file for bankruptcy; or consolidate, reduce or terminate operations, which could adversely affect the demand for leasing space on towers and negatively impact both Array’s current revenue and cash flows, as well as future growth opportunities. Array’s revenues may be adversely affected by negative trends in the wireless industry, changes in the business model of its tenants or reduced demand for its large carriers’ services among their end users. Specifically, Array’s business, financial condition, revenues, liquidity, results of operations and future growth may be adversely affected by the following factors, among others:
▪The overall size and growth rate of Array’s tenant base;
▪Demand for or usage of wireless services, particularly data services;
▪Delays or failures of FCC spectrum auctions and wireless carriers ability to deploy new spectrum;
▪Emergence of new technologies that reduce the need for towers;
Management's Discussion & Analysis (MD&A)
New heading “2025-2024 Commentary”
New heading “Net income (loss) from discontinued operations attributable to TDS shareholders”
New heading “2024-2023 Commentary”
New heading “Interest expense”
New heading “Net income (loss) from discontinued operations attributable to TDS shareholders”
New heading “Net income (loss) from continuing operations attributable to noncontrolling interests, net of tax”
New heading “2025-2024 Commentary”
New heading “2024-2023 Commentary”
New heading “(Gain) loss on asset disposals, net”
New heading “Noncontrolling interest investments”
New heading “Retained spectrum”
New heading “Financial Overview — Array”
New heading “Key components of changes in the statement of operations items were as follows:”
New heading “2025-2024 Commentary”
New heading “Site rental revenues”
New heading “Services revenues”
New heading “Cost of operations”
New heading “Selling, general and administrative”
New heading “Interest and dividend income”
New heading “Interest expense”
New heading “Short-term imputed spectrum lease income”
New heading “2024-2023 Commentary”
New heading “Site rental revenues”
New heading “Cost of operations”
New heading “Loss on impairment of licenses”
New heading “2025 Commentary”
New heading “Current assets of discontinued operations”
New heading “Other current assets”
New heading “Non-current assets held for sale”
New heading “Non-current assets of discontinued operations”
New heading “Other intangible assets, net of accumulated amortization”
New heading “Current portion of long-term debt”
New heading “Customer deposits and deferred revenues”
New heading “Accrued compensation”
New heading “Current liabilities of discontinued operations”
New heading “Non-current liabilities of discontinued operations”
New heading “Deferred income tax liability, net”
New heading “Other deferred liabilities and credits”
New heading “Long-term debt, net”
New heading “Noncontrolling interests with redemption features”
New heading “▪Array entered into License Purchase Agreements with Verizon and T-Mobile to sell certain wireless spectrum licenses. There is no guarantee that such transactions contemplated by the License Purchase Agreements will be consummated. Costs and uncertainties related to these transactions could have adverse effects on Array's financial condition or results of operations.”
New heading “▪An inability to monetize the remaining spectrum assets as well as the ongoing costs to retain the spectrum could adversely affect TDS’ operations.”
New heading “▪There are economic and business risks associated with fixed rate annual escalators on Array's colocation revenue contracts.”
New heading “▪Inability to protect TDS’ real estate rights, with respect to land leases, could have an adverse effect on TDS’ business, financial condition or results of operations.”
New heading “▪TDS’ business, financial condition or results of operations may be adversely impacted by extreme weather events, climate-related events, natural disasters (including wildfires) and other unforeseen events.”
Removed heading “Significant Financial Matters”
Removed heading “Equity in earnings of unconsolidated entities”
Removed heading “Income tax expense”
Removed heading “UScellular Mission and Strategy”
Removed heading “Financial Overview — UScellular”
Removed heading “Wireless Operations”
Removed heading “Postpaid Revenue”
Removed heading “Financial Overview — Wireless”
Removed heading “Operating Revenues”
Removed heading “Service revenues consist of:”
Removed heading “Equipment revenues consist of:”
Removed heading “Key components of changes in the statement of operations line items were as follows:”
Removed heading “Total operating revenues”
Removed heading “System operations expenses”
Removed heading “Cost of equipment sold”
Removed heading “Selling, general and administrative expenses”
Removed heading “Total operating revenues”
Removed heading “Total operating expenses”
Removed heading “System operations expenses”
Removed heading “Cost of equipment sold”
Removed heading “Selling, general and administrative expenses”
Removed heading “Depreciation, amortization and accretion”
Removed heading “Towers Operations”
Removed heading “Number of colocations”
Removed heading “Financial Overview — Towers”
Removed heading “Key components of changes in the statement of operations line items were as follows:”
Removed heading “Total tower revenues”
Removed heading “Total operating expenses”
Removed heading “Capital expenditures”
Removed heading “Total tower revenues”
Removed heading “Capital expenditures”
Removed heading “Receivables Securitization Agreement”
Removed heading “Variable Interest Entities”
Removed heading “Other current liabilities”
Removed heading “Regulatory Matters”
Removed heading “Spectrum Auctions”
Removed heading “FCC Enhanced Alternative Connect America Cost Model (E-ACAM)”
Removed heading “▪If the T-Mobile, Verizon and AT&T transactions are not consummated, substantial changes will be required to the manner in which UScellular’s wireless business is conducted, and we expect there will be a material adverse effect on TDS' financial condition and results of operations.”
Removed heading “▪Changes in roaming practices or other factors could cause TDS’ roaming revenues to decline from current levels, roaming expenses to increase from current levels and/or impact TDS’ ability to service its customers in geographic areas where TDS does not have its own network, which could have an adverse effect on TDS’ business, financial condition or results of operations.”
Removed heading “▪A failure by TDS to obtain access to adequate radio spectrum to meet current or anticipated future needs and/or to accurately predict future needs for radio spectrum could have an adverse effect on TDS’ business, financial condition or results of operations.”
Removed heading “▪Complexities associated with deploying new technologies present substantial risk and TDS’ investments in unproven technologies may not produce the benefits that TDS expects.”
Removed heading “▪TDS has a significant amount of indebtedness which could adversely affect its financial performance and in turn adversely affect its ability to make payments on its indebtedness, comply with terms of debt covenants and incur additional debt.”
Removed heading “▪TDS has entered into a Senior Secured Credit Agreement that imposes certain restrictions on its business and operations that may affect its ability to operate its business and make payments on its indebtedness.”
Removed heading “▪The possible development of adverse precedent in litigation or conclusions in professional or environmental studies to the effect that potentially harmful emissions from devices or network equipment, including but not limited to radio frequencies emitted by wireless signals or due to contamination from network cabling, may cause harmful health or environmental consequences, including cancer, tumors or otherwise harmful impacts, or may interfere with various electronic medical devices or frequencies used by other industries, could have an adverse effect on TDS’ wireless and/or wireline business, financial condition or results of operations.”
Removed heading “▪Claims of infringement of intellectual property and proprietary rights of others, primarily involving patent infringement claims, could prevent TDS from using necessary technology to provide products or services or subject TDS to expensive intellectual property litigation or monetary penalties, which could have an adverse effect on TDS’ business, financial condition or results of operations.”
Removed heading “▪The impact of public health emergencies on TDS' business is uncertain, but depending on duration and severity could have a material adverse effect on TDS' business, financial condition or results of operations.”
Removed heading “Intangible assets impairment, net of tax”
Largest changes
“▪Claims of infringement of intellectual property and proprietary rights of others, primarily involving patent infringement claims, could prevent TDS from using necessary technology to provide products or services or subject TDS to expensive intellectual property litigation or monetary penalties, which could have an adverse effect on TDS’ business, financial condition or results of operations.”see in full comparison
“▪The possible development of adverse precedent in litigation or conclusions in professional or environmental studies to the effect that potentially harmful emissions from devices or network equipment, including but not limited to radio frequencies emitted by wireless signals or due to contamination from network cabling, may cause harmful health or environmental consequences, including cancer, tumors or otherwise harmful impacts, or may interfere with various electronic medical devices or frequencies used by other industries, could have an adverse effect on TDS’ wireless and/or wireline …”see in full comparison
“This term loan is secured by a perfected security interest in certain assets of TDS, including 26 million common shares in UScellular, TDS' equity interest in certain wholly-owned subsidiaries, and all or substantially all of TDS' personal property that does not constitute equity interests. …”see in full comparison
“▪TDS has a significant amount of indebtedness which could adversely affect its financial performance and in turn adversely affect its ability to make payments on its indebtedness, comply with terms of debt covenants and incur additional debt.”see in full comparison
“▪TDS’ business, financial condition or results of operations may be adversely impacted by extreme weather events, climate-related events, natural disasters (including wildfires) and other unforeseen events.”see in full comparison
“Net loss attributable to TDS common shareholders was $97 million and $569 million for the years ended December 31, 2024 and 2023, respectively. The net loss in 2024 includes a non-cash charge related to the UScellular impairment of certain wireless spectrum licenses in the amount of $136 million ($102 million, net of tax), which was recorded during the three months ended September 30, 2024. The net loss in 2023 includes a non-cash charge related to the TDS Telecom Goodwill impairment of $547 million ($511 million, net of tax), which was recorded during the three months ended December 31, 2023. …”see in full comparison
Full comparison: every changed paragraph (375)
The following Management’s Discussion and Analysis (MD&A) should be read in conjunction with the audited consolidated financial statements and notes of Telephone and Data Systems, Inc. (TDS) for the year ended December 31, 2024,2025, and with the description of TDS’ business included herein. Certain numbers included herein are rounded to thousands or millions for ease of presentation; however, certain calculated amounts and percentages are determined using the unrounded numbers.
On August 1, 2025, United States Cellular Corporation, a 82.0%-owned subsidiary of TDS, changed its name to Array Digital Infrastructure, Inc. (Array). Array is used throughout this report even when referring to historical periods.
General
TDS is a diversified telecommunications company that provides high-quality communications services. TDS provides broadband, video, voice and wireless services through its wholly-owned subsidiary, TDS Telecommunications LLC (TDS Telecom). Array leases tower space to tenants and provides ancillary services, holds noncontrolling interests in primarily wireless operating companies and holds certain wireless spectrum licenses. TDS operates entirely in the United States. See Note 20 — Business Segment Information in the Notes to Consolidated Financial Statements for additional information about TDS' segments.
TDS is a diversified telecommunications company that provides high-quality communications services to approximately 5.5 million connections nationwide. TDS provides wireless services and leases tower space to third-party carriers on owned towers through its 83%-owned subsidiary, United States Cellular Corporation (UScellular). TDS also provides broadband, video, voice and wireless services through its wholly-owned subsidiary, TDS Telecommunications LLC (TDS Telecom). TDS operates entirely in the United States.
During the second quarter of 2024, TDS and UScellular modified their reporting structure due to the planned disposal of the UScellular wireless operations and, as a result, disaggregated the UScellular operations into two reportable segments – Wireless and Towers. This presentation reflects how TDS' and UScellular's chief operating decision maker allocates resources and evaluates operating performance following this strategic shift. Prior periods have been updated to conform to the new reportable segments. See Note 20 — Business Segment Information in the Notes to Consolidated Financial Statements for additional information about TDS' segments.
20242025 Operating Revenues by Segment*
*Represents revenues related to continuing operations.
TDS’ mission is to provide outstanding communications services to its customers and meet the needs of its shareholders, its people, and its communities. In pursuing this mission, TDS seeks to grow its businesses, create opportunities for its associates, support the communities it serves, and build and return value over the long term for its shareholders. Since its founding, TDS has been committed to bringing high-quality communications services to rural and underserved communities. TDS continues to make progress on developing and enhancing its Environmental, Social and Governance (ESG) program, including the publication of the most recent TDS ESG Report in August 2024, which is available on the TDS website.
TDS’ strategy has been to re-invest the majority of its operating capital in its businesses to strengthen their competitive positions and financial performance, while also returning value to TDS shareholders.
TDS’ historical long-term strategy has been to re-invest the majority of its operating capital in its businesses to strengthen their competitive positions and financial performance, while also returning value to TDS shareholders primarily through the payment of a regular quarterly cash dividend. In the second quarter of 2024, TDS reset its approach to capital allocation and declared dividends in the second, third, and fourth quarters of 2024 at approximately 20% of the first quarter of 2024 dividend for TDS Common and Series A shares. This shift in approach is expected to free up additional capital that can be used to support TDS' fiber program, among other purposes. It is uncertain at this time how the outcome of the ongoing strategic alternatives review process for UScellular, TDS' available opportunities to reinvest in its businesses, or TDS' ongoing liquidity needs, may impact the decisions of the TDS Board of Directors regarding the declaration of future dividends.
Announced Transactions and Strategic Alternatives Review
On August 1, 2025, Array sold its wireless operations and select spectrum assets to T-Mobile US, Inc. (T-Mobile) under a Securities Purchase Agreement (Securities Purchase Agreement). Total consideration received was $4,293.8 million after adjustments which included a combination of $2,628.8 million in cash proceeds and $1,665.0 million in debt assumed by T-Mobile through the preliminary results of an exchange offer made to Array's debtholders, which subsequently closed on August 5, 2025. The final cash proceeds are subject to adjustment according to the terms and conditions of the Securities Purchase Agreement. As of December 31, 2025, Array recorded an estimated purchase price true-up due to T-Mobile of $20.2 million. At closing, a $16.7 million deferral of the purchase price was recorded related to certain spectrum licenses included in the transaction that did not transfer to T-Mobile and are subject to FCC approval. In addition, at closing, Array and T-Mobile entered into a Short-Term Spectrum Manager Lease Agreement and Short-Term Spectrum Manager Sublease Agreements which provide T-Mobile with an exclusive license to use certain Array spectrum assets and leases at no cost for up to one-year for the sole purpose of providing continued, uninterrupted service to customers. Further, at closing, Array and T-Mobile entered into a Master License Agreement (MLA), pursuant to which, among other things, T-Mobile has agreed to license from Array space on towers owned by Array. The wireless operations and select spectrum assets sold to T-Mobile are presented as discontinued operations throughout this report. See Note 2 — Discontinued Operations in Notes to Consolidated Financial Statements for additional information.
In addition to the sale of Array's wireless operations and select spectrum assets sold to T-Mobile pursuant to the Securities Purchase Agreement, Array also separately entered into the following agreements to sell spectrum license assets.
1These license transactions remain subject to regulatory approval and other customary closing conditions, and in the case of the sale to Verizon, the termination of the T-Mobile Short-Term Spectrum Manager Lease Agreement. See Note 7 — Acquisitions and Divestitures in the Notes to Consolidated Financial Statements for additional information.
2Following the close of the transaction on January 13, 2026, TDS expects to record a book gain on the transaction of approximately $150.0 million ($114.0 million net of tax expense) during the first quarter of 2026. The expected book gain recorded at TDS is lower than the expected book gain recorded at Array due primarily to transaction costs paid by TDS.
On August 4, 2023, TDS and UScellular announced that the Boards of Directors of both companies decided to initiate a process to explore a range of strategic alternatives for UScellular. On May 28, 2024, UScellular announced that its Board of Directors unanimously approved the execution of a Securities Purchase Agreement (Securities Purchase Agreement) by and among TDS, UScellular, T-Mobile US, Inc. (T-Mobile) and USCC Wireless Holdings, LLC, pursuant to which, among other things, UScellular agreed to sell its wireless operations and select spectrum assets to T-Mobile for a purchase price, subject to adjustments, as specified in the Securities Purchase Agreement, of $4,400 million, which is payable in a combination of cash and the assumption of up to approximately $2,000 million in debt. The purchase price includes $100 million contingent on the satisfaction of certain financial and operational metrics. The purchase price also includes $400 million allocated to certain wireless spectrum licenses held by entities in which UScellular is a non-controlling limited partner. The closing with respect to these wireless spectrum licenses is contingent upon UScellular's purchase, which is pending receipt of regulatory approval, of the remaining equity in the entities that UScellular does not currently own. The Securities Purchase Agreement also contemplates, among other things, a Short-Term Spectrum Manager Lease Agreement and Short-Term Spectrum Manager Sublease Agreements that will become effective at the closing date, which provide T-Mobile with an exclusive license to use certain UScellular spectrum assets and leases at no cost for up to one-year for the sole purpose of providing continued, uninterrupted service to customers. The sale of the wireless business to T-Mobile is expected to close in mid-2025, subject to the receipt of regulatory approvals and the satisfaction of customary closing conditions.
To effect the disposition and wind down of the wireless operations in accordance with the terms of the Securities Purchase Agreement, UScellular expects that if the closing of the transaction were to occur that such closing will trigger or accelerate the recognition of certain cash and non-cash obligations. Such obligations include contingent advisory fees, employee compensation and severance, employee stock award costs, debt extinguishment, income tax expense, administrative costs, restructuring expenses and other wind down costs. UScellular also expects to incur significant decommissioning costs for certain towers that UScellular elects to retire, and such decommissioning costs are also expected to include remaining obligations under related ground leases. These costs are expected to have a significant impact on TDS' financial statements.
On October 17, 2024, UScellular, and certain subsidiaries of UScellular, entered into a License Purchase Agreement (Verizon Purchase Agreement) with Verizon Communications Inc. (Verizon) to sell certain AWS, Cellular and PCS wireless spectrum licenses and agreed to grant Verizon certain rights to lease such licenses prior to the transaction close for total proceeds of $1,000 million. As of December 31, 2024, UScellular's book value of the wireless spectrum licenses to be sold was $586 million. The transaction is subject to regulatory approval and other customary closing conditions, and is contingent on the closing of the T-Mobile transaction and the termination of the T-Mobile Short-Term Spectrum Manager Lease Agreement.
On November 6, 2024, UScellular, and certain subsidiaries of UScellular, entered into a License Purchase Agreement (AT&T Purchase Agreement) with New Cingular Wireless PCS, LLC (AT&T), a subsidiary of AT&T Inc. to sell certain 3.45 GHz and 700 MHz wireless spectrum licenses and agreed to grant AT&T certain rights to lease and sub-lease such licenses prior to the transaction close for total proceeds of $1,018 million, subject to certain purchase price adjustments. As of December 31, 2024, UScellular's book value of the wireless spectrum licenses to be sold was $859 million. The transaction is subject to regulatory approval and other customary closing conditions and substantially all of the licenses subject to the transaction are contingent on the closing of the T-Mobile transaction. The purchase price includes $232 million allocated to certain wireless spectrum licenses that are held by an entity in which UScellular is a non-controlling limited partner. The closing with respect to these wireless spectrum licenses is contingent upon UScellular's purchase, which is pending receipt of regulatory approval, of the remaining equity in the entity that UScellular does not currently own.
The strategic alternatives review process is ongoing as UScellularArray works toward closing the Verizon and T-Mobile spectrum transactions signed during 2024, including the T-Mobile, Verizon2024 and AT&T transactions2025, and continues to seekseeks to opportunistically monetize its remaining spectrum assets that are not subject to theexecuted Securitiesagreements. PurchaseIn Agreement,addition to the Verizontransactions Purchaseat Agreement,Array, orTDS continues to explore opportunities to transform its business operations given the AT&Tchange Purchasein Agreement.scale of the overall TDS organization following the divestiture of the wireless operations. These processes are collectively referred to as the strategic alternatives review throughout this report.
TDS incurred third-party expenses related to the announced transactions and strategic alternatives review of $56$9.1 million, $33.3 million and $13$13.0 million for the years ended December 31, 2025, 2024 and 2023, respectively.respectively, which are included in Selling, general and administrative (SG&A) and Cost of operations expenses for continuing operations.
Significant Financial Matters
Net loss attributable to TDS common shareholders was $97 million and $569 million for the years ended December 31, 2024 and 2023, respectively. The net loss in 2024 includes a non-cash charge related to the UScellular impairment of certain wireless spectrum licenses in the amount of $136 million ($102 million, net of tax), which was recorded during the three months ended September 30, 2024. The net loss in 2023 includes a non-cash charge related to the TDS Telecom Goodwill impairment of $547 million ($511 million, net of tax), which was recorded during the three months ended December 31, 2023. The conclusions that impairments were required in 2024 and 2023 were made in connection with the review and preparation of the financial statements. See Note 8 — Intangible Assets for a detailed discussion regarding the impairments. Refer to Supplemental Information to Non-GAAP Financial Measures within this MD&A for a reconciliation of the Intangible assets impairment, net of tax.
▪Adjusted EBITDA – non-GAAP metric referring to earnings before interest, taxes, depreciation, amortization and accretion, gains and losses and other nonrecurring expenses. See Supplemental Information Relating to Non-GAAP Financial Measures within this MD&A for additional information.
▪Adjusted OIBDA – non-GAAP measure referring to operating income before depreciation, amortization and accretion, gains and losses and other nonrecurring expenses. See Supplemental Information Relating to Non-GAAP Financial Measures within this MD&A for additional information
▪4G LTE – fourth generation Long-Term Evolution, which is a wireless technology that enables more network capacity for more data per user as well as faster access to data compared to third generation (3G) technology.
▪5G – fifth generation wireless technology that helps address customers’ growing demand for data services and creates opportunities for new services requiring high speed and reliability as well as low latency.
▪Account – represents an individual or business financially responsible for one or multiple associated connections. An account may include a variety of types of connections such as handsets and connected devices.
▪Auction 107 – Auction 107 was an FCC auction of 3.7-3.98 GHz wireless spectrum licenses that started in December 2020 and concluded in February 2021.
▪Churn Rate – represents the percentage of the connections that disconnect service each month. These rates represent the average monthly churn rate for each respective period.
▪Colocations – represents instances where a third-party wireless carrier rents or leases space on a company-owned tower.
▪Connected Devices – non-handset devices that connect directly to the UScellular network. Connected devices include products such as tablets, wearables, modems, fixed wireless, and hotspots.
▪EBITDA – refers to earnings before interest, taxes, depreciation, amortization and accretion and is used in the non-GAAP metric Adjusted EBITDA throughout this document. See Supplemental Information Relating to Non-GAAP Financial Measures within this MD&A for additional information.
▪Eligible Telecommunications Carrier (ETC) – designation by states for providing specified services in “high cost” areas which enables participation in universal service support mechanisms.
▪Gross Additions – represents the total number of new connections added during the period, without regard to connections that were terminated during that period.
▪Net Additions (Losses) – represents the total number of new connections added during the period, net of connections that were terminated during that period.
▪OIBDA – refers to operating income before depreciation, amortization and accretion and is used in the non-GAAP metric Adjusted OIBDA throughout this document. See Supplemental Information Relating to Non-GAAP Financial Measures within this MD&A for additional information.
▪Postpaid Average Revenue per Account (Postpaid ARPA) – metric which is calculated by dividing total postpaid service revenues by the average number of postpaid accounts and by the number of months in the period.
▪Postpaid Average Revenue per User (Postpaid ARPU) – metric which is calculated by dividing total postpaid service revenues by the average number of postpaid connections and by the number of months in the period.
▪Residential Fiber Churn Rate – represents the percentage of incumbent and expansion fiber connections that disconnected service each month. These rates represent the average monthly churn rate for each respective period.
▪Retail Connections – individual lines of service associated with each device activated by a postpaid or prepaid customer. Connections are associated with all types of devices that connect directly to the UScellular network.
▪Tower Tenancy Rate – calculated as total number of colocations divided by total number of towers.
▪Tower Tenancy Rate – average number of tenants that lease space on company-owned towers, measured on a per-tower basis.
▪Wireless Connections – refers to an individual mobile line provisioned through TDS' mobile virtual network operator (MVNO) arrangement and delivered under the TDS-branded wireless offering.
▪VoLTE – Voice over Long-Term Evolution is a technology specification that defines the standards and procedures for delivering voice communications and related services over 4G LTE networks.
The following discussion and analysis compares financial results for the year ended December 31, 2025, to the year ended December 31, 2024 and the year ended December 31, 2024, to the year ended December 31, 2023.
N/M - Percentage change not meaningful
The following discussion and analysis compares financial results for the year ended December 31, 2024, to the year ended December 31, 2023 and omits discussion of the year ended December 31, 2023 compared to the year ended December 31, 2022. Refer to Management's Discussion and Analysis of Financial Condition and Results of Operations in TDS' Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 16, 2024, for that discussion.
2025-2024 Commentary
Equity in earnings of unconsolidated entities
Equity in earnings of unconsolidated entities represents TDS’TDS' share of net income from entities in which it has a noncontrolling interest and that are accounted for using the equity method or the net asset value practical expedient. TDS’Array investmentholds noncontrolling interests in three entities managed by Array in the Los Angeles SMSA Limited Partnership (LA Partnership) contributed pre-tax incomestate of $62Iowa millionthat sold their wireless operations to T-Mobile in three separate transactions on August 1, 2025, the same date that Array sold its wireless operations to T-Mobile. As a result of the Iowa entities' sale of their wireless operations, these entities recognized a gain on sale, and $65Array's millionproportionate forshare 2024of andthat 2023,gain respectively.was included in Equity in earnings of unconsolidated entities in the amount of $33.4 million, which was the primary driver of the year-over-year increase in 2025. See Note 9 — Investments in Unconsolidated Entities in the Notes to Consolidated Financial Statements for additional information.
Interest expense increased in 20242025 due primarily to anthe increasewrite-off of unamortized debt costs for TDS debt facilities that were repaid in borrowingsAugust under2025, a borrowing on the TDSArray CoBank term loan agreements,in partiallyAugust offset2025 byand alower decreasecapitalized interest at Array. Interest expense from continuing operations excludes interest costs in theall averageperiods principalassociated balancewith outstandingArray onterm loans repaid, and Array debt exchanged, in conjunction with the receivablessale securitizationof agreement.Array's wireless operations to T-Mobile. See Market Risk for additional information regarding maturities of long-term debt and weighted average interest rates.
Income tax benefit on continuing operations increased in 2025 due primarily to favorable reductions to valuation allowances related to deferred tax assets that are now likely to be realized by the taxable income generated from the sale of wireless operations and select spectrum assets to T-Mobile, and/or the future License Purchase Agreements classified as held for sale as of December 31, 2025. This increase was partially offset by a decrease in the deferred tax benefit on the impairment of certain wireless spectrum licenses, which was smaller in 2025 than the impairment recorded in 2024.
Income tax expense
Income tax expense decreased in 2024 due primarily to the deferred tax impact of the wireless spectrum license impairment charge recorded in the third quarter of 2024 and a decrease in state tax expense in 2024, partially offset by the deferred tax impact of the Goodwill impairment recorded in the fourth quarter of 2023.
Net income (loss) from discontinued operations attributable to TDS shareholders
Net income (loss) from discontinued operations attributable to TDS shareholders decreased for the year ended December 31, 2025, as a result of the sale of the wireless operations on August 1, 2025 and the corresponding loss on sale recognized on that date. See Note 2 — Discontinued Operations in the Notes to Consolidated Financial Statements for additional information related to the components of Net income (loss) from discontinued operations.
Net income (loss) from continuing operations attributable to noncontrolling interests, net of tax
Net income (loss) from continuing operations attributable to noncontrolling interests, net of tax includes the noncontrolling public shareholders’ share of UScellular’sArray’s net income,income (loss) from continuing operations, the noncontrolling shareholders’ or partners’ share of certain UScellularArray subsidiaries’ net income (loss) from continuing operations and other TDS noncontrolling interests.
What changed in the latest 10-Q
Risk Factors
No wording changes found in this section.
Full comparison: every changed paragraph (0)
Management's Discussion & Analysis (MD&A)
Not available: the section could not be located automatically in both filings (non-standard layout or incorporated by reference). See the original filing. Open the filing on SEC.gov.
TDS insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 1 filing (1 insider, 1 trade date, 77,100 shares, about $3.0M). Net open-market shares: -77,100 (purchases minus sales); net value about -$3.0M.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-09-16 | Carlson Leroy T Jr |
Gift | 227,190 | — | — |
| 2026-09-11 | Carlson Leroy T Jr |
Option exercise | 77,100 | $19.15 | $1.5M |
| 2026-09-11 | Carlson Leroy T Jr |
Open-market sale | 77,100 | $38.45 | $3.0M |
| 2026-09-03 | Carlson Anthony J |
Gift | 511 | — | — |
| 2026-09-03 | Carlson Anthony J |
Gift | 511 | — | — |
| 2026-09-03 | Carlson Leroy T Jr |
Gift | 144,599 | — | — |
| 2026-09-03 | Carlson Leroy T Jr |
Gift | 140,000 | — | — |
| 2026-09-03 | Carlson Leroy T Jr |
Gift | 116,374 | — | — |
| 2026-09-03 | Carlson Leroy T Jr |
Gift | 85,150 | — | — |
| 2026-09-03 | Carlson Leroy T Jr |
Gift | 112,407 | — | — |
| 2026-09-03 | Carlson Leroy T Jr |
Gift | 85,150 | — | — |
| 2026-06-11 | Villacrez Vicki L |
Option exercise | 10,170 | $40.03 | $407.1K |
| 2026-06-11 | Villacrez Vicki L |
Shares withheld for tax | 4,780 | $40.03 | $191.3K |
| 2026-06-11 | Kroll Anita J |
Option exercise | 2,716 | $40.03 | $108.7K |
| 2026-06-11 | Kroll Anita J |
Shares withheld for tax | 1,277 | $40.03 | $51.1K |
| 2026-06-11 | Carlson Leroy T Jr |
Shares withheld for tax | 18,935 | $40.03 | $758.0K |
| 2026-06-11 | Carlson Leroy T Jr |
Option exercise | 45,135 | $40.03 | $1.8M |
| 2026-06-09 | Dixon Kenneth S. |
Option exercise | 4,653 | $39.33 | $183.0K |
| 2026-06-09 | Dixon Kenneth S. |
Shares withheld for tax | 1,489 | $39.33 | $58.6K |
| 2026-05-21 | Off George W |
Grant/award | 2,905 | $41.20 | $119.7K |
| 2026-05-21 | Oleary Christopher D |
Grant/award | 2,905 | $41.20 | $119.7K |
| 2026-05-21 | Dixon Kimberly D |
Grant/award | 2,905 | $41.20 | $119.7K |
| 2026-05-21 | Oosterman Wade |
Grant/award | 2,905 | $41.20 | $119.7K |
| 2026-05-21 | Woessner Dirk S |
Grant/award | 2,905 | $41.20 | $119.7K |
| 2026-05-21 | Woessner Dirk S |
Shares withheld for tax | 228 | $41.20 | $9.4K |
| 2026-05-21 | Carlson Letitia G C |
Grant/award | 2,905 | $41.20 | $119.7K |
| 2026-05-21 | Carlson Prudence E |
Grant/award | 2,905 | $41.20 | $119.7K |
| 2026-05-21 | Carlson Walter Cd |
Shares withheld for tax | 5,016 | $41.20 | $206.7K |
| 2026-05-21 | Carlson Walter Cd |
Grant/award | 11,905 | $41.20 | $490.5K |
| 2026-05-21 | Carlson Leroy T Jr |
Option exercise | 4,961 | $41.20 | $204.4K |
| 2026-05-21 | Carlson Leroy T Jr |
Shares withheld for tax | 2,198 | $41.20 | $90.6K |
| 2026-05-21 | Carlson Anthony J |
Option exercise | 695 | $41.20 | $28.6K |
| 2026-05-21 | Carlson Anthony J |
Shares withheld for tax | 204 | $41.20 | $8.4K |
| 2026-05-21 | Villacrez Vicki L |
Option exercise | 5,478 | $41.20 | $225.7K |
| 2026-05-21 | Villacrez Vicki L |
Shares withheld for tax | 2,575 | $41.20 | $106.1K |
| 2026-05-21 | Hanley Joseph R |
Option exercise | 3,265 | $41.20 | $134.5K |
| 2026-05-21 | Hanley Joseph R |
Shares withheld for tax | 1,447 | $41.20 | $59.6K |
| 2026-05-21 | Kroll Anita J |
Shares withheld for tax | 688 | $41.20 | $28.3K |
| 2026-05-21 | Kroll Anita J |
Option exercise | 1,463 | $41.20 | $60.3K |
| 2026-05-21 | Rutledge Napoleon B Jr |
Grant/award | 2,905 | $41.20 | $119.7K |
| 2026-05-19 | Hanley Joseph R |
Shares withheld for tax | 14,689 | $42.06 | $617.8K |
| 2026-05-19 | Hanley Joseph R |
Option exercise | 12,423 | $19.15 | $237.9K |
| 2026-05-19 | Hanley Joseph R |
Option exercise | 7,748 | $25.36 | $196.5K |
| 2026-05-17 | Carlson Leroy T Jr |
Option exercise | 163,146 | $40.50 | $6.6M |
| 2026-05-17 | Carlson Leroy T Jr |
Shares withheld for tax | 66,483 | $40.50 | $2.7M |
| 2026-05-17 | Carlson Leroy T Jr |
Shares withheld for tax | 306,558 | $40.50 | $12.4M |
| 2026-05-17 | Carlson Leroy T Jr |
Option exercise | 713,344 | $40.50 | $28.9M |
| 2026-05-17 | Kroll Anita J |
Option exercise | 21,409 | $40.50 | $867.1K |
| 2026-05-17 | Kroll Anita J |
Shares withheld for tax | 3,454 | $40.50 | $139.9K |
| 2026-05-17 | Kroll Anita J |
Option exercise | 7,348 | $40.50 | $297.6K |
| 2026-05-17 | Kroll Anita J |
Shares withheld for tax | 6,971 | $40.50 | $282.3K |
| 2026-05-17 | Villacrez Vicki L |
Shares withheld for tax | 14,022 | $40.50 | $567.9K |
| 2026-05-17 | Villacrez Vicki L |
Option exercise | 86,956 | $40.50 | $3.5M |
| 2026-05-17 | Villacrez Vicki L |
Option exercise | 29,833 | $40.50 | $1.2M |
| 2026-05-17 | Villacrez Vicki L |
Shares withheld for tax | 39,089 | $40.50 | $1.6M |
| 2026-05-17 | Hanley Joseph R |
Option exercise | 58,191 | $40.50 | $2.4M |
| 2026-05-17 | Hanley Joseph R |
Shares withheld for tax | 23,122 | $40.50 | $936.4K |
| 2026-05-17 | Hanley Joseph R |
Option exercise | 19,966 | $40.50 | $808.6K |
| 2026-05-17 | Hanley Joseph R |
Shares withheld for tax | 8,845 | $40.50 | $358.2K |
Well-known investors holding TDS (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Third Point (Dan Loeb) | 2026-06-30 | 6,275,000 | $232.2M | 4.99% | Reduced 5% |
| Oaktree Capital Management (Howard Marks) | 2026-06-30 | 5,282,905 | $195.5M | 3.68% | Added 23% |
| Point72 Asset Management (Steve Cohen) | 2026-06-30 | 490,915 | $18.2M | 0.03% | Reduced 16% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 304,251 | $11.3M | 0.01% | Reduced 20% |
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 88,474 | $3.3M | 0.0% | Added 2% |
| Two Sigma Investments | 2026-06-30 | 65,884 | $2.4M | 0.0% | Reduced 23% |
| D. E. Shaw & Co. | 2026-06-30 | 25,690 | $950.8K | 0.0% | Reduced 43% |
| Millennium Management (Israel Englander) | 2026-06-30 | 8,762 | $324.3K | 0.0% | Reduced 95% |