UScellular reports first quarter 2025 results
As previously announced, UScellular will hold a teleconference on May 2, 2025, at 9:00 a.m. CDT. Listen to the call live via the Events & Presentations page of investors.uscellular.com.
CHICAGO, May 2, 2025 /PRNewswire/ -- United States Cellular Corporation (NYSE: USM) reported total operating revenues of $891 million for the first quarter of 2025, versus $950 million for the same period one year ago. Service revenues totaled $741 million, versus $754 million for the same period one year ago. Net income attributable to UScellular shareholders and related diluted earnings per share were $18 million and $0.21, respectively, for the first quarter of 2025 compared to $18 million and $0.20, respectively, in the same period one year ago.
Recent Highlights*
-- Improved postpaid handset results
-- Postpaid handset gross additions increased; postpaid handset net
losses improved
-- Third-party tower rental revenues increased 6%
-- Ongoing 5G mid-band network deployment
-- Providing capacity and enhanced speed for our mobility and fixed
wireless customers
* Comparisons are 1Q'24 to 1Q'25 unless otherwise noted
"In the first quarter, we continued to work towards executing on our 2025 priorities which include successfully closing on the previously announced sale of the wireless business, while remaining focused on investing in a strong customer experience and operating our business efficiently," said Laurent Therivel, UScellular President and CEO. "I am also pleased with the 6% year-over-year growth in third-party tower rental revenues, as the team continues to market our valuable tower portfolio."
Announced Transactions and Exploration of Strategic Alternatives for UScellular
On May 24, 2024, Telephone and Data Systems, Inc. (TDS) and UScellular entered into a Securities Purchase Agreement to sell UScellular's wireless operations and select spectrum assets to T-Mobile US, Inc. (T-Mobile). The transaction is expected to close in mid-2025, subject to regulatory approvals and the satisfaction of customary closing conditions. When the proposed T-Mobile transaction closes, UScellular expects the UScellular Board of Directors to declare the first of potentially several, special dividends to UScellular shareholders.
On October 17, 2024, UScellular, and certain subsidiaries of UScellular, entered into a License Purchase Agreement with Verizon Communications, Inc. (Verizon) to sell certain AWS, Cellular and PCS wireless spectrum licenses, subject to receipt of regulatory approvals, and agreed to grant Verizon certain rights to lease such licenses prior to the transaction close. Additionally, UScellular also entered into agreements with Nsight Spectrum, LLC and Nex-Tech Wireless, LLC for the sale of select spectrum licenses.
On November 6, 2024, UScellular, and certain subsidiaries of UScellular, entered into a License Purchase Agreement with New Cingular Wireless PCS, LLC (AT&T), a subsidiary of AT&T Inc. to sell certain 3.45 GHz and 700 MHz wireless spectrum licenses, subject to receipt of regulatory approvals, and agreed to grant AT&T certain rights to lease and sub-lease such licenses prior to the transaction close.
Due to the pending transaction with T-Mobile, UScellular is not providing 2025 financial guidance.
Stock Repurchase
During the first quarter of 2025, UScellular repurchased 328,835 of its Common Shares for $21 million.
Conference Call Information
UScellular will hold a conference call on May 2, 2025 at 9:00 a.m. Central Time.
-- Access the live call on the Events & Presentations page of
investors.uscellular.com or at
https://events.q4inc.com/attendee/224819726
-- Access the call by phone at (888)330-2384 conference ID: 1328528.
Before the call, certain financial and statistical information to be discussed during the call will be posted to investors.uscellular.com. The call will be archived on the Events & Presentations page of investors.uscellular.com.
About UScellular
United States Cellular Corporation provides a comprehensive range of wireless products and services, excellent customer support, and a high-quality network to customers with 4.4 million retail connections in 21 states. The Chicago-based company had 4,100 full- and part-time associates as of March 31, 2025. At the end of the first quarter of 2025, Telephone and Data Systems, Inc. owned approximately 83 percent of UScellular. For more information about UScellular, visit uscellular.com.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: All information set forth in this news release, except historical and factual information, represents forward-looking statements. This includes all statements about the company's plans, beliefs, estimates, and expectations, including with respect to the expected closing date of the transaction with T-Mobile. 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 the announced transactions whereby UScellular has agreed to sell its wireless operations and selected spectrum assets will be successfully completed. 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 UScellular's Form 10-K, as updated by any UScellular Form 10-Q filed subsequent to such Form 10-K.
For more information about UScellular, visit: www.uscellular.com
United States Cellular Corporation
Summary Operating Data (Unaudited)
As of or for the Quarter Ended 3/31/2025 12/31/2024 9/30/2024 6/30/2024 3/31/2024
Retail Connections
Postpaid
Total at end of period(1) 3,946,000 3,985,000 3,999,000 4,027,000 4,051,000
Gross additions 105,000 140,000 123,000 117,000 106,000
Handsets 68,000 93,000 84,000 73,000 63,000
Connected devices 37,000 47,000 39,000 44,000 43,000
Net additions (losses)(1) (39,000) (14,000) (28,000) (24,000) (44,000)
Handsets (38,000) (19,000) (28,000) (29,000) (47,000)
Connected devices (1,000) 5,000 5,000 3,000
ARPU(2) $52.06 $51.73 $52.04 $51.45 $51.96
ARPA(3) $132.25 $131.10 $131.81 $130.41 $132.00
Handset upgrade rate4 3.1 % 4.8 % 3.5 % 4.1 % 4.5 %
Churn rate5 1.21 % 1.29 % 1.25 % 1.16 % 1.22 %
Handsets 1.03 % 1.08 % 1.07 % 0.97 % 1.03 %
Connected devices 2.40 % 2.67 % 2.47 % 2.47 % 2.52 %
Prepaid
Total at end of period(1) 431,000 448,000 452,000 439,000 436,000
Gross additions 38,000 46,000 57,000 50,000 41,000
Net additions (losses)(1) (17,000) (4,000) 13,000 3,000 (13,000)
ARPU(2) $30.76 $30.59 $32.01 $32.37 $32.25
Churn rate5 4.17 % 3.70 % 3.30 % 3.60 % 4.06 %
Market penetration at end of period
Consolidated operating population 31,390,000 32,550,000 32,550,000 32,550,000 32,550,000
Consolidated operating penetration6 17 % 15 % 15 % 15 % 14 %
Capital expenditures (millions) $53 $162 $120 $165 $131
Total cell sites in service 7,009 7,010 7,007 6,990 6,995
Owned towers 4,413 4,409 4,407 4,388 4,382
Number of colocations7 2,469 2,444 2,418 2,392 2,397
Tower tenancy rate8 1.56 1.55 1.55 1.55 1.55
(1) First quarter 2024 connections were adjusted to remove subscribers that could no longer access the UScellular network due to the CDMA shutdown. This resulted in 11,000 and 2,000 subscribers removed from the
postpaid and prepaid base, respectively, that are not included in Net additions (losses) for the quarter.
(2) Average Revenue Per User (ARPU) -metric is calculated by dividing a revenue base by an average number of connections and by the number of months in the period. These revenue bases and connection populations
are shown below:
-- Postpaid ARPU consists of total postpaid service revenues and postpaid connections.
-- Prepaid ARPU consists of total prepaid service revenues and prepaid connections.
(3)
Average Revenue Per Account (ARPA) - metric is calculated by dividing total postpaid service revenues by the average number of postpaid accounts and by the number of months in the period.
4
Handset upgrade rate calculated as total handset upgrade transactions divided by average postpaid handset connections.
5
Churn rate represents the percentage of the connections that disconnect service each month. These rates represent the average monthly churn rate for each respective period.
6
Market penetration is calculated by dividing the number of wireless connections at the end of the period by the total estimated population of consolidated operating markets.
7
Represents instances where a third-party wireless carrier rents or leases space on a company-owned tower.
8
Average number of tenants that lease space on company-owned towers, measured on a per-tower basis.
United States Cellular Corporation
Consolidated Statement of Operations Highlights
(Unaudited)
Three Months Ended
March 31,
2025 2024 2025
vs.
2024
(Dollars and shares in millions, except per share amounts)
Operating revenues
Service $741 $754 (2) %
Equipment sales 150 196 (24) %
Total operating revenues 891 950 (6) %
Operating expenses
System operations (excluding Depreciation, amortization and accretion reported below) 176 182 (3) %
Cost of equipment sold 178 216 (18) %
Selling, general and administrative 332 331
Depreciation, amortization and accretion 163 165 (2) %
(Gain) loss on asset disposals, net 2 6 (65) %
(Gain) loss on license sales and exchanges, net (1) (1) 18 %
Total operating expenses 850 899 (5) %
Operating income 41 51 (19) %
Other income (expense)
Equity in earnings of unconsolidated entities 36 42 (14) %
Interest and dividend income 3 2 20 %
Interest expense (40) (43) 10 %
Total other income (expense) (1) 1 N/M
Income before income taxes 40 52 (22) %
Income tax expense 20 28 (26) %
Net income 20 24 (17) %
Less: Net income attributable to noncontrolling interests, net of tax 2 6 (75) %
Net income attributable to UScellular shareholders $18 $18 3 %
Basic weighted average shares outstanding 85 85
Basic earnings per share attributable to UScellular shareholders $0.21 $0.21 3 %
Diluted weighted average shares outstanding 88 88
Diluted earnings per share attributable to UScellular shareholders $0.21 $0.20 2 %
N/M -Percentage change not
meaningful
United States Cellular Corporation
Consolidated Statement of Cash Flows
(Unaudited)
Three Months Ended
March 31,
2025 2024
(Dollars in millions)
Cash flows from operating activities
Net income $20 $24
Add (deduct) adjustments to reconcile net income to net cash flows from operating activities
Depreciation, amortization and accretion 163 165
Bad debts expense 20 29
Stock-based compensation expense 17 13
Deferred income taxes, net (8) 4
Equity in earnings of unconsolidated entities (36) (42)
Distributions from unconsolidated entities 11 22
(Gain) loss on asset disposals, net 2 6
(Gain) loss on license sales and exchanges, net (1) (1)
Other operating activities 1 1
Changes in assets and liabilities from operations
Accounts receivable 1 16
Equipment installment plans receivable 38 2
Inventory 1 24
Accounts payable (17) (15)
Customer deposits and deferred revenues (8) 5
Accrued taxes 29 23
Accrued interest 9 9
Other assets and liabilities (82) (82)
Net cash provided by operating activities 160 203
Cash flows from investing activities
Cash paid for additions to property, plant and equipment (72) (133)
Cash paid for licenses (2) (11)
Net cash used in investing activities (74) (144)
Cash flows from financing activities
Issuance of long-term debt - 40
Repayment of long-term debt (5) (55)
Tax payments, net of cash receipts, for stock-based compensation awards (7)
Repurchase of Common Shares (21)
Distributions to noncontrolling interests (2) (2)
Cash paid for software license agreements (9) (9)
Other financing activities - (2)
Net cash used in financing activities (44) (28)
Net increase in cash, cash equivalents and restricted cash 42 31
Cash, cash equivalents and restricted cash
Beginning of period 159 179
End of period $201 $210
United States Cellular Corporation
Consolidated Balance Sheet Highlights
(Unaudited)
ASSETS
March 31, 2025 December 31, 2024
(Dollars in millions)
Current assets
Cash and cash equivalents $182 $144
Accounts receivable, net 925 955
Inventory, net 178 179
Prepaid expenses 63 46
Other current assets 25 21
Total current assets 1,373 1,345
Assets held for sale 1
Licenses 4,581 4,579
Investments in unconsolidated entities 479 454
Property, plant and equipment, net 2,394 2,502
Operating lease right-of-use assets 925 926
Other assets and deferred charges 612 643
Total assets $10,365 $10,449
United States Cellular Corporation
Consolidated Balance Sheet Highlights
(Unaudited)
LIABILITIES AND EQUITY
March 31, 2025 December 31, 2024
(Dollars in millions, except per share amounts)
Current liabilities
Current portion of long-term debt $26 $22
Accounts payable 207 242
Customer deposits and deferred revenues 231 238
Accrued taxes 57 30
Accrued compensation 33 93
Short-term operating lease liabilities 140 141
Other current liabilities 113 118
Total current liabilities 807 884
Deferred liabilities and credits
Deferred income tax liability, net 720 728
Long-term operating lease liabilities 824 822
Other deferred liabilities and credits 570 570
Long-term debt, net 2,829 2,837
Noncontrolling interests with redemption features 16 16
Equity
UScellular shareholders' equity
Series A Common and Common Shares, par value $1.00 per share 88 88
Additional paid-in capital 1,800 1,783
Treasury shares (125) (112)
Retained earnings 2,822 2,818
Total UScellular shareholders' equity 4,585 4,577
Noncontrolling interests 14 15
Total equity 4,599 4,592
Total liabilities and equity $10,365 $10,449
United States Cellular Corporation
Segment Results
(Unaudited)
Three Months Ended
March 31,
UScellular 2025 2024 2025
vs. 2024
(Dollars in millions)
Operating Revenues
Wireless $864 $925 (7) %
Towers 61 58 5 %
Intra-company eliminations (34) (33) (3) %
Total operating revenues 891 950 (6) %
Operating expenses
Wireless 844 896 (6) %
Towers 40 36 11 %
Intra-company eliminations (34) (33) (3) %
Total operating expenses 850 899 (5) %
Operating income $41 $51 (19) %
Adjusted OIBDA(1) (Non-GAAP) $215 $228 (6) %
Adjusted EBITDA1 (Non-GAAP) $254 $272 (7) %
Capital expenditures $53 $131 (60) %
(1) Adjusted OIBDA and Adjusted EBITDA are non-GAAP financial measures which UScellular uses as measurements of profitability. See EBITDA, Adjusted EBITDA and Adjusted OIBDA Reconciliations within this
earnings release for additional information.
United States Cellular Corporation
Segment Results
(Unaudited)
Three Months Ended
March 31,
UScellular Wireless 2025 2024 2025
vs. 2024
(Dollars in millions)
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 (excluding Depreciation, amortization and accretion reported below) 191 197 (3) %
Cost of equipment sold 178 216 (18) %
Selling, general and administrative 322 324
Depreciation, amortization and accretion 152 154 (2) %
(Gain) loss on asset disposals, net 2 6 (73) %
(Gain) loss on license sales and exchanges, net (1) (1) 18 %
Total operating expenses 844 896 (6) %
Operating income $20 $29 (30) %
Adjusted OIBDA(1) (Non-GAAP) $182 $195 (7) %
Adjusted EBITDA(1) (Non-GAAP) $182 $195 (7) %
Capital expenditures $51 $127 (60) %
Three Months Ended
March 31,
UScellular Towers 2025 2024 2025
vs. 2024
(Dollars in millions)
Third-party revenues $27 $25 6 %
Intra-company revenues 34 33 3 %
Total tower revenues 61 58 5 %
System operations (excluding Depreciation, amortization and accretion reported below) 19 18 4 %
Selling, general and administrative 10 7 33 %
Depreciation, amortization and accretion 11 11 5 %
Total operating expenses 40 36 11 %
Operating income $21 $22 (5) %
Adjusted OIBDA1 (Non-GAAP) $33 $33 (1) %
Adjusted EBITDA(1) (Non-GAAP) $33 $33 (1) %
Capital expenditures $2 $4 (42) %
(1) Adjusted OIBDA and Adjusted EBITDA are non-GAAP financial measures which UScellular uses as measurements of profitability. See EBITDA, Adjusted EBITDA and Adjusted OIBDA Reconciliations within this
earnings release for additional information.
United States Cellular Corporation
Financial Measures
(Unaudited)
Free Cash Flow
Three Months Ended
March 31,
UScellular 2025 2024
(Dollars in millions)
Cash flows from operating activities (GAAP) $160 $203
Cash paid for additions to property, plant and equipment (72) (133)
Cash paid for software license agreements (9) (9)
Free cash flow (Non-GAAP)(1) $79 $61
(1) Free cash flow is a non-GAAP financial measure which UScellular 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.
United States Cellular Corporation
EBITDA, Adjusted EBITDA and Adjusted OIBDA Reconciliations
(Unaudited)
EBITDA, Adjusted EBITDA and Adjusted OIBDA are defined as net income adjusted for the items set forth in the reconciliations below. 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. UScellular does not intend to imply that any such items set forth in the reconciliations below 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 UScellular's operating results before significant recurring non-cash charges, nonrecurring expenses, gains and losses, and other items as presented below as they provide additional relevant and useful information to investors and other users of UScellular's 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, and expenses related to the strategic alternatives review of UScellular 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. The following tables reconcile EBITDA, Adjusted EBITDA and Adjusted OIBDA to the corresponding GAAP measure, Net income, Income before income taxes and/or Operating income. Income and expense items below Operating income are not provided at the individual segment level for UScellular Wireless and UScellular Towers; therefore, the reconciliations begin with EBITDA and the most directly comparable GAAP measure is Operating income rather than Net income at the segment level.
Three Months Ended
March 31,
UScellular 2025 2024
(Dollars in millions)
Net income (GAAP) $20 $24
Add back or deduct:
Income tax expense 20 28
Income before income taxes (GAAP) 40 52
Add back:
Interest expense 40 43
Depreciation, amortization and accretion expense 163 165
EBITDA (Non-GAAP) 243 260
Add back or deduct:
Expenses related to strategic alternatives review 10 7
(Gain) loss on asset disposals, net 2 6
(Gain) loss on license sales and exchanges, net (1) (1)
Adjusted EBITDA (Non-GAAP) 254 272
Deduct:
Equity in earnings of unconsolidated entities 36 42
Interest and dividend income 3 2
Adjusted OIBDA (Non-GAAP) $215 $228
Three Months Ended
March 31,
UScellular Wireless 2025 2024
(Dollars in millions)
EBITDA (Non-GAAP) $172 $183
Add back or deduct:
Expenses related to strategic alternatives review 9 7
(Gain) loss on asset disposals, net 2 6
(Gain) loss on license sales and exchanges, net (1) (1)
Adjusted EBITDA and Adjusted OIBDA (Non-GAAP) 182 195
Deduct:
Depreciation, amortization and accretion 152 154
Expenses related to strategic alternatives review 9 7
(Gain) loss on asset disposals, net 2 6
(Gain) loss on license sales and exchanges, net (1) (1)
Operating income (GAAP) $20 $29
Three Months Ended
March 31,
UScellular Towers 2025 2024
EBITDA (Non-GAAP) $32 $33
Add back or deduct:
Expenses related to strategic alternatives review 1
Adjusted EBITDA and Adjusted OIBDA (Non-GAAP) 33 33
Deduct:
Depreciation, amortization and accretion 11 11
Expenses related to strategic alternatives review 1
Operating income (GAAP) $21 $22
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SOURCE United States Cellular Corporation
