Telephone And Data Systems Stock Earnings Reports

Key points for investors:

- TDS (parent) announced a proposal to acquire the remaining public shares of Array in an all‑stock merger (0.86 TDS share per Array share, assuming ~$10.40/share dividend of spectrum proceeds). Management says the deal would simplify corporate structure, eliminate duplicate costs, improve liquidity and capital flexibility, and expose Array shareholders to TDS’s growing fiber business. The proposal is subject to a special committee review at Array and customary approvals. TDS will not entertain third‑party offers for Array.

- TDS Telecom (fiber/cable) continues rapid fiber build and commercialization: delivered a record 40,000 marketable fiber service addresses in Q1 (nearly 3x Q1 2025), ended the quarter serving ~1.1 million fiber addresses (58% of footprint) with 79% gig capability, and added ~11,000 residential fiber net adds (+32% YoY). 2026 target remains 200k–250k new fiber addresses; 2026 guidance unchanged (revenues $1.015–1.055B; adj. EBITDA $310–350M; capex $550–600M).

- TDS continues disciplined M&A in fiber markets; announced acquisition of Granite State Communications (~11k fiber addresses, contiguous market) expected to close in Q3.

- Transformation and cost programs are progressing: cash expense savings and systems migrations (billing conversion in cable, new field force platform); management expects $100M run‑rate savings by end of 2028 with some benefits already appearing in 2026.

- Array (tower business) reported strong tower fundamentals: cash site‑rental revenue up materially (55% YoY overall; 64% YoY normalized for DISH nonpayment), sequential tenancy improvement excluding DISH, continued progress monetizing spectrum (sales to AT&T closed; several T‑Mobile and Verizon spectrum sales expected to close in Q2–Q3 subject to approvals). Array has reserved unpaid amounts from DISH and ceased recognizing DISH revenue; DISH remains in dispute under its MLA.

- Capital allocation / shareholder return: TDS had no buybacks in the quarter but has a $520M authorization available. Management emphasizes disciplined allocation—funding fiber growth from cash while pursuing accretive tuck‑ins.

- Risks/uncertainties highlighted: timing and approval of spectrum sale closings, continued legacy revenue pressure from copper/cable (guidance skewed to lower half), ongoing wind‑down costs at Array, and the need to convert new addresses into customers to offset legacy declines.