TDS reports second quarter 2026 results

TDS Telecom and Array both update guidance for 2026

CHICAGO, Aug. 7, 2026 /PRNewswire/ --

As previously announced, TDS will hold a teleconference on August 7, 2026, at 9:00 a.m. CT. Listen to the call live via the Events & Presentations page of investors.tdsinc.com.

Telephone and Data Systems, Inc. (NYSE: TDS) reported second quarter 2026 operating results.

"I am pleased with the progress our teams continue to make in executing our strategic objectives," said Walter Carlson, TDS President and CEO. "During the quarter, TDS Telecom expanded its marketable fiber service footprint by approximately 66,000 addresses and increased its fiber service address guidance for the year. Array delivered another quarter of sequential tower tenancy growth, highlighting the value of our assets. In addition, Array completed the previously announced spectrum sale to Verizon, now having completed transactions to monetize virtually all of its spectrum outside of the C-Band."

Highlights*

TDS Telecom

Array

*Comparisons are 2Q'25 to 2Q'26 unless otherwise noted

TDS reported total operating revenues from continuing operations of $309.3 million for the second quarter of 2026, versus $298.5 million for the same period one year ago. Net income (loss) attributable to TDS common shareholders and diluted earnings (loss) per share from continuing operations were $260.6 million and $2.24, respectively, for the second quarter of 2026 compared to $(6.0) million and $(0.05), respectively, in the same period one year ago.

Recent Development

On May 7, 2026, TDS delivered to the Array Board of Directors a letter setting forth a non-binding proposal to acquire all of the outstanding Array Common Shares that are not owned by TDS (the "Array Proposal"). A special committee of independent and disinterested directors of the Array Board of Directors has been formed to evaluate this proposal. For additional information on the Array Proposal, see TDS' Current Report on Form 8-K, filed with the U.S. Securities and Exchange Commission on May 8, 2026.

2026 Estimated Results

TDS' current estimates of full-year 2026 results for TDS Telecom and Array are shown below. Such estimates represent management's view as of August 7, 2026 and should not be assumed to be current as of any future date. TDS undertakes no duty to update such estimates, whether as a result of new information, future events, or otherwise. There can be no assurance that final results will not differ materially from estimated results.

TDS Telecom

Current

(Dollars in millions)

Total operating revenues

$1,015-$1,055

$1,000-$1,025

Adjusted OIBDA 1 (Non-GAAP)

$300-$340

$300-$320

Adjusted EBITDA 1 (Non-GAAP)

$310-$350

$310-$330

Capital expenditures

$550-$600

$625-$675

Array

Current

(Dollars in millions)

Total operating revenues

$200-$215

$205-$215

Adjusted OIBDA 1 (Non-GAAP)

$50-$65

$60-$75

Adjusted EBITDA 1 (Non-GAAP)

$200-$215

$220-$235

Capital expenditures

$25-$35

Unchanged

The following tables reconcile EBITDA, Adjusted EBITDA and Adjusted OIBDA to the corresponding GAAP measures, Net income or Income (loss) before income taxes. In providing 2026 estimated results, TDS has not completed the below reconciliation to Net income because it does not provide guidance for income taxes. Although potentially significant, TDS believes that the impact of income taxes cannot be reasonably predicted; therefore, TDS is unable to provide such guidance.

2026 Estimated Results

TDS

Telecom

Array

(Dollars in millions)

Net income from continuing operations (GAAP)

N/A

Add back:

Income tax expense

N/A

Income (loss) before income taxes (GAAP)

($15)-$5

$775-$790

Add back:

Interest expense

—

Depreciation, amortization and accretion expense

325

EBITDA (Non-GAAP) 1

$310-$330

$870-$885

Add back or deduct:

(Gain) loss on license sales and exchanges, net

—

(585)

Short-term imputed spectrum lease income

—

(65)

Adjusted EBITDA (Non-GAAP) 1

$310-$330

$220-$235

Deduct:

Equity in earnings of unconsolidated entities

—

145

Interest and dividend income

Other, net

—

Adjusted OIBDA (Non-GAAP) 1

$300-$320

$60-$75

Actual Results

Six Months Ended

June 30, 2026

Year Ended

December 31, 2025

TDS

Telecom

Array

TDS

Telecom

Array

(Dollars in millions)

Net income (loss) from continuing operations (GAAP)

$ (4)

$ 517

$ 28

$ 172

Add back:

Income tax expense (benefit)

(4)

168

(31)

Income (loss) before income taxes (GAAP)

$ (8)

$ 686

$ 38

$ 141

Add back:

Interest expense

—

(7)

Depreciation, amortization and accretion expense

146

300

EBITDA (Non-GAAP) 1

$ 138

$ 731

$ 331

$ 218

Add back or deduct:

Expenses related to strategic alternatives review

—

(Gain) loss on impairment of intangible assets

—

(Gain) loss on asset disposals, net

(Gain) loss on sale of business and other exit costs, net

—

(23)

—

(Gain) loss on license sales and exchanges, net

(2)

(566)

—

(6)

Short-term imputed spectrum lease income

—

(58)

—

(69)

Adjusted EBITDA (Non-GAAP) 1

$ 144

$ 119

$ 330

$ 194

Deduct:

Equity in earnings of unconsolidated entities

—

174

Interest and dividend income

Other, net

—

Adjusted OIBDA (Non-GAAP) 1

$ 140

$ 33

$ 319

$ 1

Numbers may not foot due to rounding.

EBITDA, Adjusted EBITDA and Adjusted OIBDA are defined as net income from continuing operations adjusted for the items set forth in the reconciliation above. EBITDA, Adjusted EBITDA and Adjusted OIBDA are not measures of financial performance under Generally Accepted Accounting Principles in the United States (GAAP) and should not be considered as alternatives to Net income or Cash flows from operating activities, as indicators of cash flows or as measures of liquidity. TDS does not intend to imply that any such items set forth in the reconciliation above are infrequent or unusual; such items may occur in the future. Management uses Adjusted EBITDA and Adjusted OIBDA as measurements of profitability, and therefore reconciliations to Net income are deemed appropriate. Management believes Adjusted EBITDA and Adjusted OIBDA are useful measures of TDS' operating results before significant recurring non-cash charges, nonrecurring expenses, gains and losses, and other items as presented above as they provide additional relevant and useful information to investors and other users of TDS' financial data in evaluating the effectiveness of its operations and underlying business trends in a manner that is consistent with management's evaluation of business performance. Adjusted EBITDA shows adjusted earnings before interest, taxes, depreciation, amortization and accretion, gains and losses, while Adjusted OIBDA reduces this measure further to exclude Equity in earnings of unconsolidated entities and Interest and dividend income in order to more effectively show the performance of operating activities excluding investment activities.

Conference Call Information

TDS will hold a conference call on August 7, 2026 at 9:00 a.m. CT.

Before the call, certain financial and statistical information to be discussed during the call will be posted to investors.tdsinc.com. The call will be archived on the Events & Presentations page of investors.tdsinc.com.

About TDS

Telephone and Data Systems, Inc. (TDS) provides broadband, video, voice and wireless services through its TDS Telecom business. Array leases tower space to tenants and provides ancillary services, holds noncontrolling interests in primarily wireless operating companies and holds certain wireless spectrum licenses. Founded in 1969, TDS is headquartered in Chicago.

Visit investors.tdsinc.com for comprehensive financial information, including earnings releases, quarterly and annual filings, shareholder information and more.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: All information set forth in this news release about Telephone and Data Systems, Inc., including its subsidiaries Array and TDS Telecom, except historical and factual information, represents forward-looking statements. This includes all statements about the Company's plans, beliefs, estimates and expectations. These statements are based on current estimates, projections, and assumptions, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Important factors that may affect these forward-looking statements include, but are not limited to: whether any transaction related to the TDS non-binding proposal delivered to the Array Board of Directors to acquire all of the outstanding Array Common Shares not owned by TDS will be accepted, rejected, consummated, or abandoned; whether any such transaction, if accepted or completed, will result in additional value for shareholders and whether the process could result in adverse effects on either business; the manner in which Array's remaining business is conducted; strategic decisions regarding the tower business; whether the additional spectrum license sales to T-Mobile are consummated; whether Array can monetize its remaining spectrum assets; intense competition, including fixed wireless and satellite; economic and business risks associated with fixed rate annual escalators on colocation revenue contracts; Array's reliance on a small number of tenants for a substantial portion of its revenue; the ability to attract people of outstanding talent throughout all levels of the organization; TDS' lack of scale relative to larger competitors; TDS' inability to protect rights to the land under its towers; changes in demand, consumer preferences and perceptions, price competition, or cost; advances or changes in technology; impacts of costs, integration issues or other factors associated with acquisitions, divestitures or exchanges of properties and/or expansion of TDS' businesses; the ability of the company to successfully construct and manage its networks; difficulties involving third parties with which TDS does business; uncertainties in TDS' future cash flows and liquidity and access to the capital markets; the ability to make payments on TDS and Array indebtedness or comply with the terms of debt covenants; conditions in the U.S. telecommunications industry; the value of assets and investments, including significant investments in wireless operating entities that Array does not control; the state and federal regulatory environment, including changes in regulatory support received and the ability to pass through certain regulatory fees to customers; pending and future litigation; cyber-attacks or other breaches of network or information technology security; control by the TDS Voting Trust; disruption in credit or other financial markets; deterioration of U.S. or global economic conditions; and extreme weather events. Investors are encouraged to consider these and other risks and uncertainties that are more fully described under "Risk Factors" in the most recent filing of TDS' Form 10-K as updated by any TDS Form 10-Q filed subsequent to such Form 10-K.

For more information about TDS and its subsidiaries, visit:

TDS: www.tdsinc.com

TDS Telecom: www.tdstelecom.com

Array: investors.arrayinc.com

TDS Telecom

Summary Operating Data (Unaudited)

As of or for the Quarter Ended

6/30/2026

3/31/2026

12/31/2025

9/30/2025

6/30/2025

Residential connections

Broadband

Incumbent Fiber

134,300

130,200

127,300

123,500

121,200

Incumbent Copper

77,700

84,200

91,200

102,000

106,500

Expansion Fiber

179,600

168,500

160,600

150,700

141,800

Cable

176,100

179,100

182,800

186,100

188,200

Total Broadband

567,700

561,900

562,400

557,700

Video

105,600

107,200

111,500

114,300

116,500

Voice

209,300

216,900

228,900

242,200

248,700

Wireless

8,100

5,300

3,300

2,200

1,600

Total Residential connections

890,700

891,400

905,600

921,100

924,500

Commercial connections

163,600

166,500

173,900

180,300

184,300

Total connections 1

1,054,200

1,058,000

1,079,500

1,101,300

1,108,800

Total residential fiber net adds

15,100

10,900

15,100

11,200

10,300

Total residential broadband net adds

5,700

100

4,500

4,600

3,900

Residential fiber churn 2

1.2 %

1.3 %

1.2 %

1.5 %

1.1 %

Total residential broadband churn

1.7 %

1.8 %

1.6 %

1.7 %

1.5 %

Residential revenue per connection 3

$ 66.50

$ 66.41

$ 65.95

$ 65.66

$ 65.85

Capital expenditures (thousands)

$ 179,197

$ 125,963

$ 154,904

$ 102,429

$ 90,187

Numbers may not foot due to rounding.

Q2 2025 total connections include 12,900 connections, including 5,300 residential broadband connections, that were part of subsequent divestitures.

Residential fiber churn 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.

Total residential revenue per connection is calculated by dividing total residential revenue by the average number of residential connections and by the number of months in the period.

Array Digital Infrastructure, Inc.

Summary Operating Data (Unaudited)

As of or for the Quarter Ended

6/30/2026

3/31/2026

12/31/2025

9/30/2025

Capital expenditures from continuing operations (thousands)

$ 3,895

$ 8,645

$ 12,933

$ 7,927

Owned towers

4,456

4,452

4,450

4,449

Number of colocations 1

4,362

4,290

4,572

4,517

Tower tenancy rate 2

0.98

0.96

1.03

1.02

Represents instances where a third-party leases space on a company-owned tower. Includes T-Mobile MLA committed site minimum of 2,015. Excludes Interim Sites whereby T-Mobile is leasing up to 1,800 sites for a period of up to 30 months subject to the terms and conditions of the MLA. As of March 31, 2026, the Number of colocations and the Tower tenancy rate exclude DISH Wireless due to the low probability of fulfilling its lease commitments.

Calculated as total number of colocations divided by total number of towers. Includes T-Mobile MLA committed site minimum of 2,015. Excludes Interim Sites whereby T-Mobile is leasing up to 1,800 sites for a period of up to 30 months subject to the terms and conditions of the MLA. As of March 31, 2026, the Number of colocations and the Tower tenancy rate exclude DISH Wireless due to the low probability of fulfilling its lease commitments. Normalized to exclude DISH, tenancy ratios would have been 0.95 and 0.94 for December 31, 2025 and September 30, 2025, respectively.

Telephone and Data Systems, Inc.

Consolidated Statement of Operations Highlights

(Unaudited)

Three Months Ended

June 30,

Six Months Ended

June 30,

2026

2025

2026

vs. 2025

2026

2025

2026

vs. 2025

(Dollars and shares in thousands, except per share amounts)

Operating revenues

TDS Telecom

$ 248,406

$ 264,931

(6) %

$ 497,978

$ 522,291

(5) %

Array

54,070

28,529

90 %

106,082

55,513

91 %

All Other 1

6,805

5,081

34 %

14,671

11,170

31 %

Total operating revenues

309,281

298,541

4 %

618,731

588,974

5 %

Operating expenses

TDS Telecom

256,684

250,959

2 %

509,988

508,460

—

Array

(345,193)

46,719

N/M

(453,966)

103,329

N/M

All Other 1

24,578

13,170

87 %

45,679

23,426

95 %

Total operating expenses

(63,931)

310,848

N/M

101,701

635,215

(84) %

Operating income (loss)

TDS Telecom

(8,278)

13,972

N/M

(12,010)

13,831

N/M

Array

399,263

(18,190)

N/M

560,048

(47,816)

N/M

All Other 1

(17,773)

(8,089)

N/M

(31,008)

(12,256)

N/M

Total operating income (loss)

373,212

(12,307)

N/M

517,030

(46,241)

N/M

Other income (expense)

Equity in earnings of unconsolidated entities

37,126

42,952

(14) %

79,028

79,471

(1) %

Interest and dividend income

19,631

6,110

N/M

33,417

12,381

N/M

Interest expense

(11,388)

(29,166)

61 %

(16,709)

(53,074)

69 %

Short-term imputed spectrum lease income

23,770

—

N/M

57,970

—

N/M

Other, net

5,346

2,395

N/M

10,796

5,117

N/M

Total other income

74,485

22,291

N/M

164,502

43,895

N/M

Income (loss) before income taxes

447,697

9,984

N/M

681,532

(2,346)

N/M

Income tax expense (benefit)

106,410

(4,224)

N/M

160,819

(12,347)

N/M

Net income from continuing operations

341,287

14,208

N/M

520,713

10,001

N/M

Less: Net income from continuing operations

attributable to noncontrolling interests, net of tax

63,332

2,943

N/M

96,143

4,667

N/M

Net income from continuing operations attributable

to TDS shareholders

277,955

11,265

N/M

424,570

5,334

N/M

Net income from discontinued operations

25,071

3,578

N/M

22,683

19,749

15 %

Less: Net income from discontinued operations

attributable to noncontrolling interests, net of tax

4,660

3,272

42 %

4,292

6,041

(29) %

Net income from discontinued operations

attributable to TDS shareholders

20,411

306

N/M

18,391

13,708

34 %

Net income

366,358

17,786

N/M

543,396

29,750

N/M

Less: Net income attributable to noncontrolling

interests, net of tax

67,992

6,215

N/M

100,435

10,708

N/M

Net income attributable to TDS shareholders

298,366

11,571

N/M

442,961

19,042

N/M

TDS Preferred Share dividends

17,306

—

34,613

—

Net income (loss) attributable to TDS common

shareholders

$ 281,060

$ (5,735)

N/M

$ 408,348

$ (15,571)

N/M

Basic weighted average shares outstanding

114,500

115,229

(1) %

114,193

114,908

(1) %

Basic earnings (loss) per share from continuing

operations attributable to TDS common

shareholders

$ 2.28

$ (0.05)

N/M

$ 3.42

$ (0.25)

N/M

Basic earnings from discontinued operations

attributable to TDS common shareholders

$ 0.17

$ —

N/M

$ 0.16

$ 0.11

35 %

Basic earnings (loss) per share attributable to TDS

common shareholders

$ 2.45

$ (0.05)

N/M

$ 3.58

$ (0.14)

N/M

Diluted weighted average shares outstanding

116,291

115,229

1 %

116,465

114,908

1 %

Diluted earnings (loss) per share from

continuing operations attributable to TDS common

shareholders

$ 2.24

$ (0.05)

N/M

$ 3.35

$ (0.26)

N/M

Diluted earnings from discontinued operations

attributable to TDS common shareholders

$ 0.18

$ —

N/M

$ 0.15

$ 0.12

32 %

Diluted earnings (loss) per share attributable to

TDS common shareholders

$ 2.42

$ (0.05)

N/M

$ 3.50

$ (0.14)

N/M

N/M - Percentage change not meaningful.

Consists of corporate and other operations and intercompany eliminations.

Telephone and Data Systems, Inc.

Consolidated Statement of Cash Flows

(Unaudited)

Six Months Ended

June 30,

2026

2025

(Dollars in thousands)

Cash flows from operating activities

Net income

$ 543,396

$ 29,750

Net income from discontinued operations

22,683

19,749

Net income from continuing operations

520,713

10,001

Add (deduct) adjustments to reconcile net income to net cash flows from operating activities

Depreciation, amortization and accretion

174,720

170,349

Bad debts expense

5,122

2,994

Stock-based compensation expense

8,428

17,502

Deferred income taxes, net

(130,935)

(14,312)

Equity in earnings of unconsolidated entities

(79,028)

(79,471)

Distributions from unconsolidated entities

66,553

87,938

(Gain) loss on asset disposals, net

10,579

7,795

(Gain) loss on sale of business and other exit costs, net

1,562

(8,877)

(Gain) loss on license sales and exchanges, net

(553,158)

(4,800)

Other operating activities

487

2,619

Changes in assets and liabilities from operations

Accounts receivable

(3,896)

(17,607)

Inventory

287

212

Accounts payable

6,732

415

Customer deposits and deferred revenues

(57,165)

(724)

Accrued taxes

232,212

(1,911)

Accrued interest

(563)

(604)

Other assets and liabilities

(51,585)

(45,560)

Net cash provided by operating activities - continuing operations

151,065

125,959

Net cash provided by (used in) operating activities - discontinued operations

(28,037)

481,307

Net cash provided by operating activities

123,028

607,266

Cash flows from investing activities

Cash paid for additions to property, plant and equipment

(317,919)

(150,482)

Cash paid for licenses

—

(4,145)

Cash received from divestitures

2,188,235

24,162

Other investing activities

1,925

2,512

Net cash provided by (used in) investing activities - continuing operations

1,872,241

(127,953)

Net cash used in investing activities - discontinued operations

—

(135,561)

Net cash provided by (used in) investing activities

1,872,241

(263,514)

Cash flows from financing activities

Issuance of long-term debt

1,300

—

Repayment of long-term debt

(150,729)

(17,076)

Tax withholdings, net of cash receipts, for TDS stock-based compensation awards

(34,219)

(24,483)

Tax withholdings, net of cash receipts, for Array stock-based compensation awards

(2,068)

(35,250)

Repurchase of Array Common Shares

—

(21,360)

Dividends paid to TDS shareholders

(43,771)

(43,830)

Array dividends paid to noncontrolling public shareholders

(332,480)

—

Payment of debt issuance costs

—

(2,467)

Distributions to noncontrolling interests

(3,540)

(2,391)

Cash paid for software license agreements

(1,180)

(839)

Payments to acquire additional interest in subsidiaries

(593)

—

Other financing activities

(314)

Net cash used in financing activities - continuing operations

(567,207)

(148,010)

Net cash used in financing activities - discontinued operations

—

(19,702)

Net cash used in financing activities

$ (567,207)

$ (167,712)

Net increase in cash, cash equivalents and restricted cash

$ 1,428,062

$ 176,040

Cash, cash equivalents and restricted cash

Beginning of period

770,150

383,222

End of period

$ 2,198,212

$ 559,262

Telephone and Data Systems, Inc.

Consolidated Balance Sheet Highlights

(Unaudited)

ASSETS

June 30, 2026

December 31, 2025

(Dollars in thousands)

Current assets

Cash and cash equivalents

$ 2,194,014

$ 765,952

Accounts receivable, net

105,830

109,981

Inventory, net

3,775

4,062

Prepaid expenses

33,697

28,206

Income taxes receivable

—

1,292

Other current assets

13,314

13,976

Total current assets

2,350,630

923,469

Non-current assets held for sale

47,475

1,598,131

Licenses

1,595,349

1,642,972

Other intangible assets, net

117,108

131,673

Investments in unconsolidated entities

475,077

461,922

Property, plant and equipment, net

3,123,477

2,965,455

Operating lease right-of-use assets

506,665

515,081

Other assets and deferred charges

167,559

159,600

Total assets

$ 8,383,340

$ 8,398,303

Telephone and Data Systems, Inc.

Consolidated Balance Sheet Highlights

(Unaudited)

LIABILITIES AND EQUITY

June 30, 2026

December 31, 2025

(Dollars in thousands, except per share amounts)

Current liabilities

Current portion of long-term debt

$ 9,444

$ 5,274

Accounts payable

130,314

115,822

Customer deposits and deferred revenues

66,280

125,140

Accrued interest

2,273

2,836

Accrued taxes

260,113

46,721

Accrued compensation

40,335

56,774

Short-term operating lease liabilities

27,634

26,180

Current liabilities of discontinued operations

24,856

20,242

Other current liabilities

54,387

41,322

Total current liabilities

615,636

440,311

Deferred liabilities and credits

Deferred income tax liability, net

600,947

743,633

Long-term operating lease liabilities

541,268

549,617

Other deferred liabilities and credits

552,629

574,025

Long-term debt, net

670,646

823,364

Total equity

5,402,214

5,267,353

Total liabilities and equity

$ 8,383,340

$ 8,398,303

Balance Sheet Highlights

(Unaudited)

June 30, 2026

TDS

Corporate

Intercompany

TDS

Telecom

Array

& Other

Eliminations

Consolidated

(Dollars in thousands)

Cash and cash equivalents

$ 222,844

$ 416,436

$ 1,780,879

$ (226,145)

$ 2,194,014

Licenses and other intangible assets

$ 117,260

$ 1,594,649

$ 548

$ —

$ 1,712,457

Investment in unconsolidated entities

3,947

421,607

60,838

(11,315)

475,077

$ 121,207

$ 2,016,256

$ 61,386

$ (11,315)

$ 2,187,534

Property, plant and equipment, net

$ 2,733,837

$ 374,700

$ 14,940

$ —

$ 3,123,477

Long-term debt, net:

Current portion

$ 164

$ 8,125

$ 1,155

$ —

$ 9,444

Non-current portion

2,765

666,757

1,124

—

670,646

$ 2,929

$ 674,882

$ 2,279

$ —

$ 680,090

TDS Telecom Highlights

(Unaudited)

Three Months Ended

June 30,

Six Months Ended

June 30,

2026

2025

2026

vs. 2025

2026

2025

2026

vs. 2025

(Dollars in thousands)

Operating revenues

Residential

Incumbent

$ 75,868

$ 84,665

(10) %

$ 153,160

$ 170,259

(10) %

Expansion

45,656

36,580

25 %

89,218

70,986

26 %

Cable

56,240

62,174

(10) %

113,982

126,022

(10) %

Total residential

177,764

183,419

(3) %

356,360

367,267

(3) %

Commercial

32,776

34,617

(5) %

65,571

69,251

(5) %

Wholesale

37,817

46,704

(19) %

75,934

85,381

(11) %

Total service revenues

248,357

264,740

(6) %

497,865

521,899

(5) %

Equipment revenues

191

(74) %

113

392

(71) %

Total operating revenues

248,406

264,931

(6) %

497,978

522,291

(5) %

Cost of operations (excluding Depreciation,

amortization and accretion reported below)

100,583

97,049

4 %

197,765

198,013

—

Cost of equipment and products

118

116

2 %

229

380

(40) %

Selling, general and administrative

79,038

82,555

(4) %

160,098

165,702

(3) %

Depreciation, amortization and accretion

73,585

73,137

1 %

146,142

144,577

1 %

(Gain) loss on asset disposals, net

4,960

6,206

(20) %

5,792

7,868

(26) %

(Gain) loss on sale of business and other exit costs, net

—

(8,104)

N/M

1,562

(8,080)

N/M

(Gain) loss on license sales and exchanges, net

(1,600)

—

N/M

(1,600)

—

N/M

Total operating expenses

256,684

250,959

2 %

509,988

508,460

—

Operating income (loss)

$ (8,278)

$ 13,972

N/M

$ (12,010)

$ 13,831

N/M

N/M - Percentage change not meaningful

Array Digital Infrastructure, Inc. Highlights

(Unaudited)

Three Months Ended

June 30,

Six Months Ended

June 30,

2026

2025

2026

vs. 2025

2026

2025

2026

vs. 2025

(Dollars in thousands)

Operating revenues

Site rental

$ 53,175

$ 27,230

95 %

$ 104,199

$ 53,825

94 %

Services

895

1,299

(31) %

1,883

1,688

12 %

Total operating revenues

54,070

28,529

90 %

106,082

55,513

91 %

Operating expenses

Cost of operations (excluding Depreciation, amortization

and accretion reported below)

23,497

19,396

21 %

45,106

35,687

26 %

Selling, general and administrative

22,906

19,337

18 %

35,651

48,537

(27) %

Depreciation, amortization and accretion

14,428

11,999

20 %

27,032

23,992

13 %

(Gain) loss on asset disposals, net

3,809

(313)

N/M

4,713

(87)

N/M

(Gain) loss on license sales and exchanges, net

(409,833)

(3,700)

N/M

(566,468)

(4,800)

N/M

Total operating expenses

(345,193)

46,719

N/M

(453,966)

103,329

N/M

Operating income (loss)

$ 399,263

$ (18,190)

N/M

$ 560,048

$ (47,816)

N/M

N/M - Percentage change not meaningful

Telephone and Data Systems, Inc.

Financial Measures

(Unaudited)

Free Cash Flow

Six Months Ended

June 30,

TDS CONSOLIDATED

2026

2025

(Dollars in thousands)

Cash flows from operating activities - continuing operations (GAAP)

$ 151,065

$ 125,959

Cash paid for additions to property, plant and equipment

(317,919)

(150,482)

Cash paid for software license agreements

(1,180)

(839)

Free cash flow - continuing operations (Non-GAAP) 1

$ (168,034)

$ (25,362)

Free cash flow is a non-GAAP financial measure which TDS believes may be useful to investors and other users of its financial information in evaluating liquidity, specifically, the amount of net cash generated by business operations after deducting Cash paid for additions to property, plant and equipment and Cash paid for software license agreements.

Telephone and Data Systems, Inc.

EBITDA, Adjusted EBITDA, Adjusted OIBDA and AFCF Reconciliations

(Unaudited)

EBITDA, Adjusted EBITDA and Adjusted OIBDA

The following tables reconcile EBITDA, Adjusted EBITDA and Adjusted OIBDA to the corresponding GAAP measures, Net income and Income (loss) before income taxes.

Three Months Ended

June 30,

Six Months Ended

June 30,

TDS Telecom

2026

2025

2026

2025

(Dollars in thousands)

Net income (loss) (GAAP)

$ (4,993)

$ 16,084

$ (3,946)

$ 19,611

Add back:

Income tax expense (benefit)

(1,909)

2,174

(3,998)

3,309

Income (loss) before income taxes (GAAP)

(6,902)

18,258

(7,944)

22,920

Add back:

Interest expense

332

(960)

175

(2,424)

Depreciation, amortization and accretion

73,585

73,137

146,142

144,577

EBITDA (Non-GAAP)

67,015

90,435

138,373

165,073

Add back or deduct:

Expenses related to strategic alternatives review

—

(Gain) loss on asset disposals, net

4,960

6,206

5,792

7,868

(Gain) loss on sale of business and other exit costs, net

—

(8,104)

1,562

(8,080)

(Gain) loss on license sales and exchanges, net

(1,600)

—

(1,600)

—

Adjusted EBITDA (Non-GAAP)

70,375

88,537

144,214

164,861

Deduct:

Interest and dividend income

463

1,693

1,608

3,094

Other, net

1,245

1,633

2,633

3,571

Adjusted OIBDA (Non-GAAP)

$ 68,667

$ 85,211

$ 139,973

$ 158,196

Three Months Ended

June 30,

Six Months Ended

June 30,

Array

2026

2025

2026

2025

(Dollars in thousands)

Net income from continuing operations (GAAP)

$ 337,447

$ 15,099

$ 517,472

$ 20,583

Add back:

Income tax expense

115,870

8,415

168,268

8,222

Income before income taxes (GAAP)

453,317

23,514

685,740

28,805

Add back:

Interest expense

10,860

3,711

18,040

7,378

Depreciation, amortization and accretion

14,428

11,999

27,032

23,992

EBITDA (Non-GAAP)

478,605

39,224

730,812

60,175

Add back or deduct:

Expenses related to strategic alternatives review

7,391

715

7,578

1,860

(Gain) loss on asset disposals, net

3,809

(313)

4,713

(87)

(Gain) loss on license sales and exchanges, net

(409,833)

(3,700)

(566,468)

(4,800)

Short-term imputed spectrum lease income

(23,770)

—

(57,970)

—

Adjusted EBITDA (Non-GAAP)

56,202

35,926

118,665

57,148

Deduct:

Equity in earnings of unconsolidated entities

34,726

41,714

75,135

77,641

Interest and dividend income

6,431

3,701

10,653

6,358

Other, net

(13)

—

(26)

—

Adjusted OIBDA (Non-GAAP)

$ 15,058

$ (9,489)

$ 32,903

$ (26,851)

Array Adjusted Free Cash Flow (AFCF)

AFCF is a non-GAAP measure defined as Net income from continuing operations adjusted for the items set forth in the reconciliation below. AFCF is not a measure of financial performance under GAAP and should not be considered as an alternative to Net income from continuing operations or as an indicator of cash flows.

Management believes AFCF is a useful measure of Array's cash generated from operations and its noncontrolling investment interests. The following table reconciles AFCF to the corresponding GAAP measure, Net income from continuing operations. This measure is presented following the sale of Array's wireless operations to T-Mobile on August 1, 2025, at which time the primary business operations for Array changed from providing wireless communications services to a standalone tower company.

Six Months Ended

June 30, 2026

(Dollars in thousands)

Net income from continuing operations - Array (GAAP)

$ 517,472

Add back or deduct:

Income tax expense

168,268

Cash paid for income taxes

(78,623)

Stock-based compensation expense

540

Short-term imputed spectrum lease income

(57,970)

Amortization of deferred debt charges

655

Equity in earnings of unconsolidated entities

(75,135)

Distributions from unconsolidated entities

66,553

(Gain) loss on license sales and exchanges, net

(566,468)

(Gain) loss on asset disposals, net

4,713

Depreciation, amortization and accretion

27,032

Expenses related to strategic alternatives review

7,578

Straight line and other non-cash revenue adjustments

(8,310)

Straight line expense adjustment

2,811

Maintenance and other capital expenditures

(2,511)

Adjusted Free Cash Flow from continuing operations - Array (Non-GAAP)

$ 6,605

SOURCE Telephone and Data Systems, Inc.