Array Digital Infrastructure, Inc. · NYSE:AD
Array Digital Infrastructure — United States Cellular — Q1 2025 Earnings Presentation
27 slides from Array Digital Infrastructure's earnings presentation, May 2, 2025
Slide 1: First Quarter 2025 Results
First Quarter 2025 Results May 2, 2025
Slide 2: Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 All information set forth in this presentation about Telephone and Data Systems, Inc., including its subsidiaries UScellular and TDS Telecom, except historical and factual information, represents forward-looking stateme
Slide 3: Corporate Update
Corporate Update Positioning the Enterprise for long-term success • Making solid progress towards a close of the proposed T-Mobile transaction, expected in mid-2025 • Taking steps to optimize capital structure post-close and defining the anticipated use of proceeds • Balancing capital allocation wit
Slide 4: UScellular
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Slide 5: Quarterly highlights
Quarterly highlights Investing in our customers, brand and network Disciplined cost management and strong free cash flow Continuing to aggressively market our towers; third-party tower rental revenues grew 6% (YoY) Focused on successfully closing the proposed transactions 5
Slide 6: Wireless - postpaid operating metrics
Wireless - postpaid operating metrics Gross Additions (in thousands) Net Additions (in thousands) 3 5 0 5 47 44 39 43 37 (19) 93 84 (29) (28) 73 68 63 (38) (47) (1) Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 Handsets Connected Devices Handsets Connected devices Fixed Wireless Subscr
Slide 7: Wireless - prepaid operating metrics
Wireless - prepaid operating metrics Gross Additions Net Additions (in thousands) (in thousands) Prepaid Churn Rate 4.06% 4.17% 3.30% 13 3.60% 3.70% 3 (4) 57 (13) 50 (17) 46 41 Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 38 Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 7
Slide 8: Towers - Q1 2025 operating metrics
Towers - Q1 2025 operating metrics Third-Party Tower Revenue 4,413 Distribution Owned Towers 14% 2,469 34% Number of Colocations 25% 1.56 27% Tower Tenancy Rate AT&T Verizon T-Mobile Other 8
Slide 9: UScellular Total - operating performance
UScellular Total - operating performance ($M) Q1'25 Q1'24 % Change Service revenues $ 741 $ 754 (2)% Equipment sales 150 196 (24)% Total operating revenues 891 950 (6)% System operations expense 176 182 (3)% Cost of equipment sold 178 216 (18)% (1) SG&A expenses 332 331 — Total cash expenses (2) 686
Slide 10: Wireless - operating performance
Wireless - operating performance ($M), except Postpaid ARPU Q1'25 Q1'24 % Change Retail service $ 660 $ 678 (3)% Other 54 51 8% Service revenues 714 729 (2)% Equipment sales 150 196 (24)% Total operating revenues 864 925 (7)% System operations expense 191 197 (3)% Cost of equipment sold 178 216 (18)
Slide 11: Towers - operating performance
Towers - operating performance ($M) Q1'25 Q1'24 % Change Third-party revenues $ 27 $ 25 6% Intra-company revenues 34 33 3% Total tower revenues 61 58 5% System operations expense 19 18 4% SG&A expenses (1) 10 7 33 % Total cash expenses (2) 29 25 12 % Adjusted EBITDA (2) (Non-GAAP) 33 33 (1)% (1) SG&
Slide 12: $4.4 Billion – sale of wireless operations & select spectrum assets to T-Mobile
$4.4 Billion – sale of wireless operations & select spectrum assets to T-Mobile (1) Significant items expected to affect net proceeds (2) Included in $4.4 Billion Timing (if not at close) Satisfaction of certain financial Contingent on UScellular achieving certain operating and financial targets pri
Slide 13: Spectrum sales to Verizon and AT&T
Spectrum sales to Verizon and AT&T (1) Significant items expected to impact net proceeds (2) Verizon (3) – purchase price $1 B AT&T – purchase price $1.018 B Included in $2.018 Billion Timing (if not at close) Designated entity spectrum $232 M of purchase price separately requires UScellular's compl
Slide 14: Other post close factors
Other post close factors • Capital structure to support business strategy • Opportunistic monetization of remaining spectrum • Identification of towers that T-Mobile intends to collocate on • Decommissioning of select towers with no colocators 14
Slide 15: Slide 15
Slide 16: Quarterly Highlights
Quarterly Highlights Deployed 14,000 new marketable fiber addresses, on track for 150,000 annual goal Grew broadband connections • 2,800 residential broadband net additions; 8,300 from fiber markets • Improvements to internal and external door-to-door sales teams Began construction in first E-ACAM m
Slide 17: Fiber driving broadband connection growth
Fiber driving broadband connection growth 20,000 Residential Broadband Net Additions 7,900 6,400 2,100 2,700 10,000 2,800 0 (10,000) Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 Expansion Incumbent Fiber Cable Incumbent Copper 17
Slide 18: Progress on long-term fiber program
Progress on long-term fiber program Deployed 14,000 marketable fiber service addresses in Q1'25 On path for copper to be only 5% of footprint Goal: Goal: Goal: Service Address Mix 1.8 million 80% 95% 15% 22% 5% marketable of service addresses service addresses Current Future fiber service to be serv
Slide 19: Growing fiber footprint driving faster speeds
Growing fiber footprint driving faster speeds Total Service Address Mix Residential Broadband Connections by Speed 1.7M 1.8M 100% 100% 17% 24% Service 9% 75% Addresses 75% 49% 52% 12% 74% 1 Gig+ 6% 50% 50% 52% Y/Y growth 46% 25% 22% 25% 25% 14% 14% 22% 18% 12% 12% 0% 0% Q1'24 Q1'25 Q1'24 Q1'25 Coppe
Slide 20: Quarterly revenue results
Quarterly revenue results Residential Revenue per Operating Revenues ($M) Connection $300 $266 $70.00 $257 $26 $34 $65.67 $64.58 $200 $90 $65.00 Note: The 2024 divested $86 2% markets contributed $4M in revenues in Q1'24. Y/Y growth $70 $60.00 $100 $64 $37 $35 $55.00 $44 $39 $— Q1'24 Q1'25 Residenti
Slide 21: TDS Telecom operating performance
TDS Telecom operating performance ($M) Q1’25 Q1’24 % Change Total operating revenues $ 257 $ 266 (3)% Cash expenses (1) 184 173 6% Adjusted EBITDA (1) (Non-GAAP) $ 76 $ 95 (20)% Capital expenditures $ 59 $ 87 (32)% 21 (1) See appendix for explanation.
Slide 22: 2025 TDS Telecom guidance
2025 TDS Telecom guidance* ($M) 2025 2025 As of May 2, 2025 2024 Actual Previous Estimates Current Estimates Total operating revenues $1,061 $1,030-$1,070 Unchanged Adjusted EBITDA (1) (Non-GAAP) $350 $320-$360 Unchanged Adjusted OIBDA (1) (Non-GAAP) $340 $310-$350 Unchanged Capital expenditures $32
Slide 23: Appendix
Appendix
Slide 24: Adjusted OIBDA and Adjusted EBITDA Reconciliation
Adjusted OIBDA and Adjusted EBITDA Reconciliation Three Months Ended March 31, 2025 Three Months Ended March 31, 2024 ($M) UScellular TDS Telecom TDS* UScellular TDS Telecom TDS* Net income (GAAP) $20 $4 $12 $24 $24 $38 Add back: Income tax expense 20 1 8 28 7 20 Income before income taxes (GAAP) $4
Slide 25: Adjusted OIBDA and Adjusted EBITDA Reconciliation
Adjusted OIBDA and Adjusted EBITDA Reconciliation Three Months Ended Three Months Ended March 31, 2025 March 31, 2024 UScellular UScellular UScellular UScellular ($M) Wireless Towers Wireless Towers EBITDA (Non-GAAP) (1) $172 $32 $183 $33 Add back or deduct: Expenses related to strategic alternative
Slide 26: Adjusted OIBDA and Adjusted EBITDA Reconciliation – 2025 Estimated Results and 2024 Actual Results
Adjusted OIBDA and Adjusted EBITDA Reconciliation – 2025 Estimated Results and 2024 Actual Results In providing 2025 estimated results, TDS has not completed the below reconciliation to net income because it does not provide guidance for income taxes. TDS believes that the impact of income taxes can
Slide 27: Cash Expenses
Cash Expenses Total cash expenses represent total operating expenses as shown in the Consolidated Statement of Operations Highlights in the TDS and UScellular SEC Forms 8-K, less depreciation, amortization and accretion and gain/losses. EBITDA, Adjusted EBITDA and Adjusted OIBDA EBITDA, Adjusted EBI
United States Cellular — Q1 2025 Earnings Presentation on 6ix