Nov 6, 2026, 7:36 AM ETCommunication Services

Telephone and Data Systems, Inc. — Third Quarter 2026 Earnings Summary

TDSTELEPHONE & DATA SYSTEMS INC

Financial Performance

Total operating revenues from continuing operations were $306.7 million for the third quarter of 2026, a 1% decrease from $308.5 million in the same period in 2025.
Net income attributable to TDS common shareholders from continuing operations was $29.6 million ($0.26 diluted EPS) for the quarter, compared to $40.2 million ($0.33 diluted EPS) in 2025.
TDS Telecom service revenue decreased 3% year-over-year; residential fiber revenue grew 14%, offset by divestiture impacts and legacy declines.
Array site rental revenues grew 14% year-over-year.
For the nine months ended September 30, 2026, total operating revenues were $925.4 million, up 3% from $897.5 million in 2025.
Net income attributable to TDS common shareholders for the nine months ended September 30, 2026, was $436.9 million, compared to a loss of $114.6 million in 2025.
Free cash flow from continuing operations for the nine months ended September 30, 2026, was $(472.8) million, compared to $(38.7) million in 2025.
Cash and cash equivalents increased to $1.64 billion as of September 30, 2026, from $770.2 million at the beginning of the period.
Long-term debt, net, decreased to $668.7 million as of September 30, 2026, from $823.4 million as of December 31, 2025.

TDS Telecom updated 2026 full-year guidance:
- Total operating revenues: $990 million to $1,010 million (previously $1,000 million to $1,025 million).
- Adjusted OIBDA: $280 million to $300 million (previously $300 million to $320 million).
- Adjusted EBITDA: $290 million to $310 million (previously $310 million to $330 million).
- Capital expenditures: Approximately $750 million (previously $625 million to $675 million).
Array reaffirmed 2026 full-year guidance with no changes to previous estimates for revenues, Adjusted OIBDA, Adjusted EBITDA, or capital expenditures.
Array continues to close pending sales of wireless spectrum; regulatory approval was received for remaining transactions in October, with closings subject to FCC finality and customary conditions.

TDS Telecom expanded its marketable fiber service footprint by approximately 76,000 addresses during the quarter.
TDS Telecom grew fiber connections by approximately 17,000 residential net adds in the quarter.
Array delivered consecutive quarter-over-quarter colocation growth.
Array continues to optimize tower operations and improve profitability.
TDS Telecom residential fiber connections reached 144,100 (Incumbent) and 191,200 (Expansion) as of September 30, 2026.
Array owned towers totaled 4,455 as of September 30, 2026, with a tower tenancy rate of 0.98.

TDS Telecom's fiber strategy focuses on expanding marketable service addresses and residential net adds.
Array benefits from sequential colocation growth, highlighting asset value.
The company faces competition from fixed wireless and satellite providers, as noted in risk factors.
TDS notes a lack of scale relative to larger competitors as a potential risk.

Risks include the manner in which Array's remaining business is conducted, strategic decisions regarding the tower business, and the consummation of additional spectrum license sales to T-Mobile.
Economic and business risks associated with fixed-rate annual escalators on colocation revenue contracts.
Reliance on a small number of tenants for a substantial portion of Array's revenue.
Potential inability to protect rights to land under towers.
Intense competition, price competition, and changes in consumer preferences or technology.
Risks related to debt covenants, liquidity, and access to capital markets.
Regulatory environment changes and potential litigation or cyber-attacks.

Walter Carlson, President and CEO, stated the company continues to make progress executing strategic objectives.
Management expressed pleasure regarding the repurchase of nearly 15 million shares in 2026, returning over $520 million to shareholders, following the withdrawal of the offer to acquire minority interest in Array.
The tone reflects confidence in the fiber broadband strategy and the optimization of tower operations.

The TDS Board authorized an incremental $250 million share repurchase plan.
TDS repurchased approximately 6 million shares in the third quarter at an average price of $36.65 per share.
Following the end of the quarter, TDS continued to be in the market, virtually exhausting the existing authorization.
TDS withdrew its non-binding proposal to acquire all outstanding Array Common Shares on September 1, 2026.
Array received regulatory approval for remaining pending spectrum transactions in October 2026.
TDS Telecom reported a loss on asset disposals of $1.3 million in the quarter, while Array reported a gain on license sales and exchanges of $566.5 million for the nine months ended September 30, 2026.