Telephone and Data Systems, Inc.

TDS Telecom said Q2 operating revenues declined 6% year over year, or 4% excluding divestitures. Residential fiber net adds were about 15,100, up 47% year over year, and fiber revenue increased 13% or $11 million versus the prior year. Cash expenses were flat, capital expenditures were $179 million, and guidance was updated: total telecom revenue of $1 billion to $1.025 billion, adjusted EBITDA of $310 million to $330 million, fiber service address delivery of 250,000 to 300,000, and CapEx of $625 million to $675 million. Array said Q2 cash site rental revenue increased 65% versus Q2 last year, with adjusted OIBDA guidance raised to $60 million to $75 million and adjusted EBITDA guidance raised to $220 million to $235 million. TDS did not provide buyback timing, but said $520 million remained under the repurchase authorization at quarter end. The company also said Array paid an $11 per common share special dividend in the quarter.

Walter Carlson framed the quarter as continued steady progress against the company’s five enterprise priorities and emphasized financial and operational discipline. He highlighted that TDS Telecom is adding meaningful fiber addresses and customers, while Array has increased tower tenancy and monetized virtually all spectrum outside C-band. He also reiterated that TDS would not comment further on the proposed all-stock transaction to acquire Array minority interests.

Vicki Villacrez said recent transactions, including Array’s Verizon spectrum sale, strengthened the balance sheet and increased capital flexibility. She pointed to TDS Telecom’s 66,000 fiber addresses delivered in Q2, the increase in annual fiber address guidance, and the fact that build cadence is not currently constrained by capital. She also noted TDS was restricted from repurchases because of the Array offer, that $520 million remained authorized, and that Array issued an $11 per share special dividend.

Analysts focused on satellite competition, fiber overbuild risk, TDS Telecom EBITDA sustainability, buyback timing, and C-band monetization. Management said satellite has not had a material impact in deployed fiber markets, terrestrial networks remain the mobile data backbone, and TDS is prioritizing being first to fiber in copper-heavy rural and E-ACAM areas. On Array’s spectrum, management said it is not in a quiet period, is encouraged by the AWS re-auction, and will look to opportunistically sell C-band when permitted, but will not be a forced seller. On buybacks, Vicki said TDS remains committed to repurchases when able, but would not speculate on timing because of the pending Array proposal.