Telephone and Data Systems (TDS) 10-Q 4 Aug 17 2017 Q2 Quarterly report Financial data

Document And Entity Information

Document And Entity Information	6 Months Ended
	Jun. 30, 2017shares
Entity Registrant Name	TELEPHONE & DATA SYSTEMS INC /DE/
Entity Central Index Key	1,051,512
Document Type	10-Q
Document Period End Date	Jun. 30, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q2
Trading Symbol	TDS
Common Shares
Entity Common Stock, Shares Outstanding	103,371,620
Series A Common Shares
Entity Common Stock, Shares Outstanding	7,244,282

Consolidated Statement Of Opera

Consolidated Statement Of Operations - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Operating revenues
Service	$ 992	$ 1,019	$ 1,989	$ 2,032
Equipment and product sales	255	276	496	518
Total operating revenues	1,247	1,295	2,485	2,550
Operating expenses
Cost of services (excluding Depreciation, amortization and accretion reported below)	298	297	580	585
Cost of equipment and products	287	309	557	600
Selling, general and administrative	419	429	825	859
Depreciation, amortization and accretion	211	210	422	422
(Gain) loss on asset disposals, net	6	6	10	12
(Gain) loss on license sales and exchanges, net	(2)	(9)	(19)	(9)
Total operating expenses	1,219	1,242	2,375	2,469
Operating income	28	53	110	81
Investment and other income (expense)
Equity in earnings of unconsolidated entities	33	36	65	72
Interest and dividend income	4	3	8	5
Interest expense	(43)	(43)	(85)	(85)
Other, net		1	1
Total investment and other income (expense)	(6)	(3)	(11)	(8)
Income before income taxes	22	50	99	73
Income tax expense	10	18	44	31
Net income	12	32	55	42
Less: Net income attributable to noncontrolling interests, net of tax	2	4	8	6
Net income attributable to TDS shareholders	10	28	47	36
Net income available to TDS common shareholders	$ 10	$ 28	$ 47	$ 36
Basic weighted average shares outstanding	111	109	110	109
Basic earnings per share available to TDS common shareholders	$ 0.09	$ 0.25	$ 0.43	$ 0.33
Diluted weighted average shares outstanding	112	111	112	111
Diluted earnings per share available to TDS common shareholders	$ 0.09	$ 0.25	$ 0.42	$ 0.32
Dividends per share to TDS shareholders	$ 0.155	$ 0.148	$ 0.310	$ 0.296

Consolidated Statement Of Compr

Consolidated Statement Of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Statement of Comprehensive Income [Abstract]
Net income	$ 12	$ 32	$ 55	$ 42
Net change in accumulated other comprehensive income
Change in net unrealized gain on equity investments		1		1
Change related to retirement plan
Amortization of prior service cost		(1)	(1)	(1)
Comprehensive income	12	32	54	42
Less: Net income attributable to noncontrolling interests, net of tax	2	4	8	6
Comprehensive income attributable to TDS shareholders	$ 10	$ 28	$ 46	$ 36

Consolidated Statement Of Cash

Consolidated Statement Of Cash Flows - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Cash flows from operating activities
Net income	$ 55	$ 42
Add (deduct) adjustments to reconcile net income to net cash flows from operating activities
Depreciation, amortization and accretion	422	422
Bad debts expense	49	46
Stock-based compensation expense	22	18
Deferred income taxes, net	(22)	8
Equity in earnings of unconsolidated entities	(65)	(72)
Distributions from unconsolidated entities	65	30
(Gain) loss on asset disposals, net	10	12
(Gain) loss on license sales and exchanges, net	(19)	(9)
Noncash interest expense	1	2
Other operating activities		(3)
Changes in assets and liabilities from operations
Accounts receivable	5	(6)
Equipment installment plans receivable	(107)	(94)
Inventory	2	(26)
Accounts payable	(59)	32
Customer deposits and deferred revenues	(10)	(18)
Accrued taxes	53	76
Accrued interest		(1)
Other assets and liabilities	(44)	(59)
Net cash provided by operating activities	358	400
Cash flows from investing activities
Cash paid for additions to property, plant and equipment	(242)	(281)
Cash paid for acquisitions and licenses	(200)	(46)
Cash received from divestitures and exchanges	17	17
Federal Communications Commission deposit		(143)
Other investing activities	1	1
Net cash used in investing activities	(424)	(452)
Cash flows from financing activities
Repayment of long-term debt	(6)	(6)
Issuance of long-term debt		2
TDS Common Shares reissued for benefit plans, net of tax payments	(1)
U.S. Cellular Common Shares reissued for benefit plans, net of tax payments		3
Repurchase of TDS Common Shares		(3)
Repurchase of U.S. Cellular Common Shares		(2)
Repurchase of TDS Preferred Shares	(1)
Dividends paid to TDS shareholders	(34)	(32)
Payment of debt issuance costs		(4)
Distributions to noncontrolling interests	(2)	(1)
Other financing activities	1	9
Net cash used in financing activities	(43)	(34)
Net decrease in cash and cash equivalents	(109)	(86)
Cash and cash equivalents
Beginning of period	900	985
End of period	$ 791	$ 899

Consolidated Balance Sheet

Consolidated Balance Sheet - USD ($) $ in Millions		Jun. 30, 2017	Dec. 31, 2016
Current assets
Cash and cash equivalents		$ 791	$ 900
Accounts receivable
Customers and agents, less allowances of $55 and $55, respectively		749	753
Other, less allowances of $1 and $2, respectively		96	98
Inventory, net		149	151
Prepaid expenses		111	115
Income taxes receivable		2	10
Other current assets		26	32
Total current assets		1,924	2,059
Assets held for sale		4	8
Licenses		2,235	1,895
Goodwill		770	766
Franchise rights		244	244
Other intangible assets, net of accumulated amortization of $137 and $153, respectively		28	33
Investments in unconsolidated entities		452	451
Other investments			1
Property, plant and equipment
In service and under construction		11,726	11,679
Less: Accumulated depreciation and amortization		8,353	8,124
Property, plant and equipment, net		3,373	3,555
Other assets and deferred charges		348	434
Total assets	[1]	9,378	9,446
Current liabilities
Current portion of long-term debt		12	12
Accounts payable		295	365
Customer deposits and deferred revenues		218	229
Accrued interest		11	11
Accrued taxes		85	44
Accrued compensation		78	127
Other current liabilities		87	99
Total current liabilities		786	887
Deferred liabilities and credits
Deferred income tax liability, net		899	922
Other deferred liabilities and credits		472	453
Long-term debt, net		2,428	2,433
Commitments and contingencies
Noncontrolling interests with redemption features		1	1
TDS shareholders' equity
Series A Common and Common Shares Authorized 290 shares (25 Series A Common and 265 Common Shares) Issued 133 shares (7 Series A Common and 126 Common Shares) Outstanding 111 shares (7 Series A Common and 104 Common Shares) and 110 shares (7 Series A Common and 103 Common Shares), respectively, Par Value ($.01 per share)		1	1
Capital in excess of par value		2,393	2,386
Treasury shares, at cost, 22 and 23 Common Shares, respectively		(684)	(698)
Accumulated other comprehensive income			1
Retained earnings		2,457	2,454
Total TDS shareholders' equity		4,167	4,144
Preferred shares			1
Noncontrolling interests		625	605
Total equity		4,792	4,750
Total liabilities and equity	[1]	$ 9,378	$ 9,446
[1]	The consolidated total assets as of June 30, 2017 and December 31, 2016 include assets held by consolidated VIEs of $759 million and $804 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of June 30, 2017 and December 31, 2016 include certain liabilities of consolidated VIEs of $17 million for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 8 — Variable Interest Entities for additional information.

Consolidated Balance Sheet Pare

Consolidated Balance Sheet Parenthetical - USD ($) shares in Millions, $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Accounts receivable
Other allowances	$ 1	$ 2
Customer and agent allowances	55	55
Other intangible assets
Other intangible assets accumulated amortization	$ 137	$ 153
TDS shareholders' equity
Authorized shares	290	290
Issued shares	133	133
Outstanding shares	111	110
Variable Interest Entities VIEs
Total VIE assets that can be used to settle only the VIEs' obligations	$ 759	$ 804
Total VIE liabilities for which creditors have no recourse	$ 17	$ 17
Series A Common Shares
TDS shareholders' equity
Authorized shares	25	25
Issued shares	7	7
Outstanding shares	7	7
Par value per share	$ 0.01	$ 0.01
Common Shares
TDS shareholders' equity
Authorized shares	265	265
Issued shares	126	126
Outstanding shares	104	103
Par value per share	$ 0.01	$ 0.01
Treasury shares at cost	22	23

Consolidated Statement of Chang

Consolidated Statement of Changes in Equity - USD ($) $ in Millions	Total	Series A Common and Common shares	Capital in excess of par value	Treasury shares	Accumulated other comprehensive income (loss)	Retained earnings	Total TDS shareholders' equity	Preferred shares	Noncontrolling interests
Beginning balance at Dec. 31, 2015	$ 4,704	$ 1	$ 2,365	$ (727)		$ 2,487	$ 4,126	$ 1	$ 577
Net income attributable to TDS shareholders	36					36	36
Net income attributable to noncontrolling interests classified as equity	6								6
TDS Common and Series A Common share dividends	(32)					(32)	(32)
Repurchase of Common shares	(3)			(3)			(3)
Dividend reinvestment plan	5		1	4			5
Incentive and compensation plans	1		(4)	9		(4)	1
Adjust investment in subsidiaries for repurchases, issuances and other compensation plans	14		(5)				(5)		19
Stock-based compensation awards	6		6				6
Distributions to noncontrolling interests	(1)								(1)
Ending balance at Jun. 30, 2016	4,736	1	2,363	(717)		2,487	4,134	1	601
Beginning balance at Dec. 31, 2016	4,750	1	2,386	(698)	$ 1	2,454	4,144	1	605
Net income attributable to TDS shareholders	47					47	47
Net income attributable to noncontrolling interests classified as equity	8								8
Other comprehensive income	(1)				$ (1)		(1)
TDS Common and Series A Common share dividends	(34)					(34)	(34)
Redemption of Preferred Shares	(1)							$ (1)
Dividend reinvestment plan	5			5			5
Incentive and compensation plans	(1)			9		(10)	(1)
Adjust investment in subsidiaries for repurchases, issuances and other compensation plans	14								14
Stock-based compensation awards	7		7				7
Distributions to noncontrolling interests	(2)								(2)
Ending balance at Jun. 30, 2017	$ 4,792	$ 1	$ 2,393	$ (684)		$ 2,457	$ 4,167		$ 625

Basis of Presentation

Basis of Presentation	6 Months Ended
	Jun. 30, 2017
Basis of Presentation [Abstract]
Basis of Presentation	Note 1 Basis of Presentation The accounting policies of Telephone and Data Systems, Inc. (TDS) conform to accounting principles generally accepted in the United States of America (GAAP) as set forth in the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC). The consolidated financial statements include the accounts of TDS and subsidiaries in which it has a controlling financial interest, including TDS’ 83% -owned wireless telephone subsidiary, United States Cellular Corporation (U.S. Cellular) and TDS’ wholly-owned subsidiary, TDS Telecommunications Corporation (TDS Telecom). In addition, the consolidated financial statements include certain entities in which TDS has a variable interest that require consolidation under GAAP. All material intercompany accounts and transactions have been eliminated. TDS’ business segments reflected in this Quarterly Report on Form 10-Q for the period ended June 30, 2017 , are U.S. Cellular, Wireline, Cable, and Hosted and Managed Services (HMS) operations. TDS’ non-reportable other business activities are presented as “Corporate, Eliminations and Other”, which includes the operations of TDS’ wholly-owned subsidiary Suttle-Straus, Inc. (Suttle-Straus). Suttle-Straus’ financial results were not significant to TDS’ operations. All of TDS’ segments operate only in the United States, except for HMS, which includes an insignificant foreign operation. See Note 10 — Business Segment Information for summary financial information on each business segment. The unaudited consolidated financial statements included herein have been prepared by TDS pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, TDS believes that the disclosures included herein are adequate to make the information presented not misleading. Certain numbers included herein are rounded to millions for ease of presentation; however, calculated amounts and percentages are determined using the unrounded numbers. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in TDS’ Annual Report on Form 10-K (Form 10-K) for the year ended December 31, 2016 . The accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal recurring items, unless otherwise disclosed) necessary for the fair statement of TDS’ financial position as of June 30, 2017 and December 31, 2016 , its results of operations and comprehensive income for the three and six months ended June 30, 2017 and 2016, and its cash flows and changes in equity for the six months ended June 30, 2017 and 2016 . These results are not necessarily indicative of the results to be expected for the full year. TDS has not changed its significant accounting and reporting policies from those disclosed in its Form 10-K for the year ended December 31, 2016 , except as described below. Equipment Installment Plans TDS equipment revenue under equipment installment plan contracts is recognized at the time the device is delivered to the end-user customer for the selling price of the device, net of any deferred imputed interest or trade-in right, if applicable. Imputed interest is reflected as a reduction to the receivable balance and recognized over the duration of the plan as Service revenues. See Note 3 — Equipment Installment Plans . Effective January 1, 2017, TDS elected to change the classification of interest income on equipment installment plan contracts from Interest and dividend income to Service revenues in the Consolidated Statement of Operations. TDS believes this classification is preferable because financing of devices as part of enrolling customers for service is an activity that is central to TDS’ operations, and it is consistent with the presentation by others in the industry. Comparative financial statements of prior years have been adjusted to apply the new classification retrospectively. As a result of this change in classification, Service revenues for the three and six months ended June 30, 2016, increased by $ 12 million and $ 24 million, respectively, from previously reported amounts, with a corresponding decrease in Interest and dividend income. In comparison, Service revenues for the three and six months ended June 30, 2017 , include $ 17 million and $ 33 million, respectively, of equipment installment plan interest income. This change did not have an impact on Income before income taxes, Net income, or Earnings per share for the three or six months ended June 30, 2016, nor did it have a cumulative impact to Retained earnings as of any date presented. Recently Issued Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (ASU 2014-09) and has since amended the standard with Accounting Standards Update 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date , Accounting Standards Update 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , Accounting Standards Update 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing , Accounting Standards Update 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients , and Accounting Standards Update 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers . These standards replace existing revenue recognition rules with a single comprehensive model to use in accounting for revenue arising from contracts with customers. TDS is required to adopt ASU 2014-09, as amended, on January 1, 2018. Early adoption as of January 1, 2017, is permitted; however, TDS did not adopt early. ASU 2014-09, as amended, impacts TDS’ revenue recognition related to the allocation of contract revenues between various services and equipment, and the timing of when those revenues are recognized. In addition, ASU 2014-09 requires deferral of incremental contract acquisition and fulfillment costs and subsequent expense recognition over the contract period or expected customer life. TDS has identified that new systems, processes and controls are required to adopt ASU 2014-09, as amended. TDS has substantially completed the design and development of new systems to perform revenue recognition accounting under the provisions of ASU 2014-09, as amended, and is currently engaged in the process of testing these new systems. TDS expects to transition to the new standard under the modified retrospective transition method whereby a cumulative effect adjustment to retained earnings is recognized upon adoption and the guidance is applied prospectively. Upon adoption, the cumulative effect adjustment is expected to include the establishment of contract asset and contract liability accounts with a corresponding adjustment to retained earnings to reflect the reallocation of revenues between service and equipment performance obligations for which control is transferred to customers in different periods. Reallocation impacts generally arise when bundle discounts are provided in a contract arrangement that includes equipment and service performance obligations. In these cases, the revenue will be reallocated according to the relative stand-alone selling prices of the performance obligations included in the bundle and this may be different than how the revenue is billed to the customer and recognized under current guidance. In addition, contract cost assets will be established to reflect costs that will be deferred as incremental contract acquisition and fulfillment costs. Incremental contract acquisition costs generally relate to commissions paid to sales associates while fulfillment costs are generally related to service installation costs on the wireline and cable businesses. TDS is evaluating the effects that adoption of ASU 2014-09, as amended, will have on its financial position and results of operations. In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (ASU 2016-02). ASU 2016-02 requires lessees to record a right-of-use asset and lease liability for almost all leases. This ASU does not substantially impact the lessor accounting model. However, some changes to the lessor accounting guidance were made to align with lessee accounting changes within Accounting Standards Codification (ASC) 842, Leases and certain key aspects of ASC 606, Revenue from Contracts with Customers. TDS is required to adopt ASU 2016-02 on January 1, 2019. Early adoption is permitted. Upon adoption of ASU 2016-02, TDS expects a substantial increase to assets and liabilities on its balance sheet. TDS is evaluating the effects that adoption of ASU 2016-02 will have on its results of operations. In June 2016, the FASB issued Accounting Standards Update 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments (ASU 2016-13). ASU 2016-13 requires entities to use a new forward-looking, expected loss model to estimate credit losses. It also requires additional disclosure relating to the credit quality of trade and other receivables, including information relating to management’s estimate of credit allowances. TDS is required to adopt ASU 2016-13 on January 1, 2020. Early adoption as of January 1, 2019 is permitted. TDS is evaluating the effects that adoption of ASU 2016-13 will have on its financial position, results of operations and disclosures. In December 2016, the FASB issued Accounting Standards Update 2016-19 Technical Corrections and Improvements (ASU 2016-19). ASU 2016-19 includes an amendment to Accounting Standards Codification Subtopic 350-40, Intangibles – Goodwill and Other – Internal-Use Software, which clarifies that a software license within the scope of the Subtopic will be accounted for as the acquisition of an intangible asset and the incurrence of a liability to the extent that the license fees are not fully paid at acquisition. TDS adopted this standard prospectively for all arrangements entered into or materially modified after January 1, 2017. In January 2017, the FASB issued Accounting Standards Update 2017-04, Intangibles – Goodwill and Other: Simplifying the Test for Goodwill Impairment (ASU 2017-04). ASU 2017-04 eliminates Step 2 of the current goodwill impairment test. Goodwill impairment loss will be measured as the amount by which a reporting unit’s carrying amount exceeds its fair value. TDS is required to adopt ASU 2017-04 on January 1, 2020. Early adoption is permitted. TDS is assessing whether it will early adopt ASU 2017-04. In February 2017, the FASB issued Accounting Standards Update 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets: Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets (ASU 2017-05). ASU 2017-05 clarifies how entities account for the derecognition of a nonfinancial asset and adds guidance for partial sales of nonfinancial assets. TDS is required to adopt ASU 2017-05 on January 1, 2018. Early adoption is permitted. The adoption of ASU 2017-05 is not expected to have a significant impact on TDS’ financial position or results of operations. In March 2017, the FASB issued Accounting Standards Update 2017-07, Compensation – Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (ASU 2017-07). ASU 2017-07 requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net periodic benefit cost must be presented separately from the service cost component and outside of Operating income in the Consolidated Statement of Operations. The guidance also specifies that only the service cost component of net benefit cost is eligible for capitalization. TDS is required to adopt ASU 2017-07 on January 1, 2018. Early adoption is permitted. The adoption of ASU 2017-07 is not expected to have a significant impact on TDS’ results of operations. In May 2017, the FASB issued Accounting Standards Update 2017-09, Compensation – Stock Compensation (ASU 2017-09). ASU 2017-09 clarifies when changes to the terms or conditions of share-based payment awards must be accounted for as modifications. TDS is required to adopt ASU 2017-09 on January 1, 2018. Early adoption is permitted. The adoption of ASU 2017-09 is not expected to have a significant impact on TDS’ financial position or results of operations. Amounts Collected from Customers and Remitted to Governmental Authorities TDS records amounts collected from customers and remitted to governmental authorities on a net basis within a tax liability account if the tax is assessed upon the customer and TDS merely acts as an agent in collecting the tax on behalf of the imposing governmental authority. If the tax is assessed upon TDS, then amounts collected from customers as recovery of the tax are recorded in Service revenues and amounts remitted to governmental authorities are recorded in Selling, general and administrative expenses in the Consolidated Statement of Operations. The amounts recorded gross in revenues that are billed to customers and remitted to governmental authorities totaled $ 20 million and $ 38 million for the three and six months ended June 30, 2017 , respectively, and $ 22 million and $ 45 million for the three and six months ended June 30, 2016 , respectively.

Fair Value Measurements

Fair Value Measurements	6 Months Ended
	Jun. 30, 2017
Fair Value Disclosures [Abstract]
Fair Value Measurements	Note 2 Fair Value Measurements As of June 30, 2017 and December 31, 2016 , TDS did not have any material financial or nonfinancial assets or liabilities that were required to be recorded at fair value in its Consolidated Balance Sheet in accordance with GAAP. The provisions of GAAP establish a fair value hierarchy that contains three levels for inputs used in fair value measurements. Level 1 inputs include quoted market prices for identical assets or liabilities in active markets. Level 2 inputs include quoted market prices for similar assets and liabilities in active markets or quoted market prices for identical assets and liabilities in inactive markets. Level 3 inputs are unobservable. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. A financial instrument’s level within the fair value hierarchy is not representative of its expected performance or its overall risk profile and, therefore, Level 3 assets are not necessarily higher risk than Level 2 assets or Level 1 assets. TDS has applied the provisions of fair value accounting for purposes of computing the fair value of financial instruments for disclosure purposes as displayed below. Level within the Fair Value Hierarchy June 30, 2017 December 31, 2016 Book Value Fair Value Book Value Fair Value (Dollars in millions) Cash and cash equivalents 1 $ 791 $ 791 $ 900 $ 900 Long-term debt Retail 2 1,753 1,815 1,753 1,741 Institutional 2 533 552 533 532 Other 2 202 201 208 207 The fair value of Cash and cash equivalents approximates the book value due to the short-term nature of these financial instruments. Long-term debt excludes capital lease obligations and the current portion of Long-term debt. The fair value of “Retail” Long-term debt was estimated using market prices for TDS’ 7.0% Senior Notes, 6.875% Senior Notes, 6.625% Senior Notes and 5.875% Senior Notes, and U.S. Cellular’s 6.95% Senior Notes, 7.25% 2063 Senior Notes and 7.25% 2064 Senior Notes. TDS’ “Institutional” debt consists of U.S. Cellular’s 6.7% Senior Notes which are traded over the counter. TDS’ “Other” debt consists of a senior term loan credit facility and other borrowings with financial institutions. TDS estimated the fair value of its Institutional and Other debt through a discounted cash flow analysis using the interest rates or estimated yield to maturity for each borrowing, which ranged from 0.00% to 6.55% and 0.00% to 6.93% at June 30, 2017 and December 31, 2016 , respectively.

Equipment Installment Plans

Equipment Installment Plans	6 Months Ended
	Jun. 30, 2017
Receivables [Abstract]
Equipment Installment Plans	Note 3 Equipment Installment Plans TDS sells devices to customers under equipment installment contracts over a specified time period. For certain equipment installment plans, after a specified period of time or amount of payments, the customer may have the right to upgrade to a new device and have the remaining unpaid equipment installment contract balance waived, subject to certain conditions, including trading in the original device in good working condition and signing a new equipment installment contract. TDS values this trade-in right as a guarantee liability. The guarantee liability is initially measured at fair value and is determined based on assumptions including the probability and timing of the customer upgrading to a new device and the fair value of the device being traded-in at the time of trade-in. When a customer exercises the trade-in option, the difference between the outstanding receivable balance forgiven and the fair value of the used device is offset against the guarantee liability. If the customer does not exercise the trade-in option at the time of eligibility, TDS begins amortizing the liability and records this amortization as additional equipment revenue. As of June 30, 2017 and December 31, 2016 , the guarantee liability related to these plans was $ 24 million and $ 33 million, respectively, and is reflected in Customer deposits and deferred revenues in the Consolidated Balance Sheet. TDS equipment installment plans do not provide for explicit interest charges. Because equipment installment plans have a duration of greater than twelve months, TDS imputes interest. TDS records imputed interest as a reduction to the related accounts receivable and recognizes it over the term of the installment agreement. Equipment installment plan receivables had a weighted average effective imputed interest rate of 12.1% and 11.2% as of June 30, 2017 and December 31, 2016 , respectively. The following table summarizes equipment installment plan receivables as of June 30, 2017 and December 31, 2016 . June 30, 2017 December 31, 2016 (Dollars in millions) Equipment installment plan receivables, gross $ 722 $ 628 Deferred interest (63) (53) Equipment installment plan receivables, net of deferred interest 659 575 Allowance for credit losses (57) (50) Equipment installment plan receivables, net $ 602 $ 525 Net balance presented in the Consolidated Balance Sheet as: Accounts receivable — Customers and agents (Current portion) $ 363 $ 345 Other assets and deferred charges (Non-current portion) 239 180 Equipment installment plan receivables, net $ 602 $ 525 TDS uses various inputs, including internal data, information from the credit bureaus and other sources, to evaluate the credit profiles of its customers. From this evaluation, a credit class is assigned to the customer that determines the number of eligible lines, the amount of credit available, and the down payment requirement, if any. Customers assigned to credit classes requiring no down payment represent a lower risk category, whereas those assigned to credit classes requiring a down payment represent a higher risk category. The balance and aging of the equipment installment plan receivables on a gross basis by credit category were as follows: June 30, 2017 December 31, 2016 Lower Risk Higher Risk Total Lower Risk Higher Risk Total (Dollars in millions) Unbilled $ 636 $ 48 $ 684 $ 553 $ 38 $ 591 Billed — current 25 2 27 23 2 25 Billed — past due 9 2 11 10 2 12 Equipment installment plan receivables, gross $ 670 $ 52 $ 722 $ 586 $ 42 $ 628 Activity for the six months ended June 30, 2017 and 2016, in the allowance for credit losses balance for the equipment installment plan receivables was as follows: June 30, 2017 June 30, 2016 (Dollars in millions) Allowance for credit losses, beginning of period $ 50 $ 26 Bad debts expense 31 28 Write-offs, net of recoveries (24) (17) Allowance for credit losses, end of period $ 57 $ 37

Earnings Per Share

Earnings Per Share	6 Months Ended
	Jun. 30, 2017
Earnings Per Share [Abstract]
Earnings per Share	N ote 4 Earnings Per Share Basic earnings per share available to TDS common shareholders is computed by dividing Net income available to TDS common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share available to TDS common shareholders is computed by dividing Net income available to TDS common shareholders by the weighted average number of common shares outstanding during the period adjusted to include the effects of potentially dilutive securities. Potentially dilutive securities primarily include incremental shares issuable upon the exercise of outstanding stock options and the vesting of performance and restricted stock units. The amounts used in computing earnings per common share and the effects of potentially dilutive securities on the weighted average number of common shares were as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 (Dollars and shares in millions, except per share amounts) Basic earnings per share available to TDS common shareholders: Net income available to TDS common shareholders used in basic earnings per share $ 10 $ 28 $ 47 $ 36 Adjustments to compute diluted earnings: Noncontrolling interest adjustment – – – – Net income available to TDS common shareholders used in diluted earnings per share $ 10 $ 28 $ 47 $ 36 Weighted average number of shares used in basic earnings per share: Common Shares 104 102 103 102 Series A Common Shares 7 7 7 7 Total 111 109 110 109 Effects of dilutive securities 1 2 2 2 Weighted average number of shares used in diluted earnings per share 112 111 112 111 Basic earnings per share available to TDS common shareholders $ 0.09 $ 0.25 $ 0.43 $ 0.33 Diluted earnings per share available to TDS common shareholders $ 0.09 $ 0.25 $ 0.42 $ 0.32 Certain Common Shares issuable upon the exercise of stock options, vesting of performance and restricted stock units or conversion of preferred shares were not included in average diluted shares outstanding for the calculation of Diluted earnings per share available to TDS common shareholders because their effects were antidilutive. The number of such Common Shares excluded was 5 million shares and 4 million shares for the three and six months ended June 30, 2017 , respectively, and 4 million shares for both the three and six months ended June 30, 2016 .

Acquisitions Divestures And Exc

Acquisitions Divestures And Exchanges	6 Months Ended
	Jun. 30, 2017
Acquisitions, Divestitures and Exchanges [Abstract]
Acquisitions, Divestures and Exchanges	Note 5 Acquisitions, Divestitures and Exchanges In February 2016, U.S. Cellular entered into an agreement with a third party to exchange certain 700 MHz licenses for certain AWS and PCS licenses and $ 28 million of cash. This license exchange was accomplished in two closings. The first closing occurred in the second quarter of 2016, at which time U.S. Cellular received $ 13 million of cash and recorded a gain of $ 9 million. The second closing occurred in the first quarter of 2017, at which time U.S. Cellular received $ 15 million of cash and recorded a gain of $ 17 million. In July 2016, the FCC announced U.S. Cellular as a qualified bidder in the FCC’s forward auction of 600 MHz spectrum licenses, referred to as Auction 1002. Prior to commencement of the forward auction, U.S. Cellular made an upfront payment to the FCC of $ 143 million in June 2016 to establish its initial bidding eligibility. In April 2017, the FCC announced by way of public notice that U.S. Cellular was the winning bidder for 188 licenses for an aggregate purchase price of $ 329 million. U.S. Cellular paid the remaining $ 186 million to the FCC and was granted the licenses during the second quarter of 2017.

Intangible Assets

Intangible Assets	6 Months Ended
	Jun. 30, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets	Note 6 Intangible Assets Activity related to Licenses for the six months ended June 30, 2017 , is presented below. Goodwill increased by $4 million and Other intangible assets increased by $1 million in the Cable segment in 2017 due to a small acquisition of a fiber telecommunications company. There were no changes to Franchise rights during the six months ended June 30, 2017 . Licenses (Dollars in millions) Balance December 31, 2016 $ 1,895 Acquisitions 331 Transferred to Assets held for sale (4) Exchanges - Licenses received 14 Exchanges - Licenses surrendered (1) Balance June 30, 2017 $ 2,235

Investments In Unconsolidated E

Investments In Unconsolidated Entities	6 Months Ended
	Jun. 30, 2017
Investments in Unconsolidated Entities [Abstract]
Investments in Unconsolidated Entities	Note 7 Investments in Unconsolidated Entities Investments in unconsolidated entities consist of amounts invested in wireless and wireline entities in which TDS holds a noncontrolling interest. These investments are accounted for using either the equity or cost method. The following table, which is based in part on information provided by third parties, summarizes the combined results of operations of TDS’ equity method investments. Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 (Dollars in millions) Revenues $ 1,636 $ 1,641 $ 3,251 $ 3,329 Operating expenses 1,229 1,173 2,446 2,408 Operating income 407 468 805 921 Other expense, net (2) (3) (2) (8) Net income $ 405 $ 465 $ 803 $ 913

Variable Interest Entities

Variable Interest Entities	6 Months Ended
	Jun. 30, 2017
Variable Interest Entities [Abstract]
Variable Interest Entities	Note 8 Variable Interest Entities Consolidated VIEs TDS consolidates variable interest entities (VIEs) in which it has a controlling financial interest as defined by GAAP and is therefore deemed the primary beneficiary. A controlling financial interest will have both of the following characteristics: (a) the power to direct the VIE activities that most significantly impact economic performance and (b) the obligation to absorb the VIE losses and right to receive benefits that are significant to the VIE. TDS reviews these criteria initially at the time it enters into agreements and subsequently when events warranting reconsideration occur. These VIEs have risks similar to those described in the “Risk Factors” in TDS’ Form 10-K for the year ended December 31, 2016 . During the first quarter of 2017, U.S. Cellular formed USCC EIP LLC, a special purpose entity (SPE), to facilitate a potential securitized borrowing using its equipment installment plan receivables in the future. Under a Receivables Sale Agreement, U.S. Cellular wholly-owned, majority-owned and unconsolidated entities, collectively referred to as “affiliated entities”, transfer device equipment installment contracts to USCC EIP LLC. This SPE will aggregate device equipment installment plan contracts for further transfer into a separate bankruptcy remote securitization trust structure, perform servicing, collection and all other administrative activities related to accounting for equipment installment plan contracts. USCC EIP LLC’s sole business consists of the acquisition of the receivables from U.S. Cellular affiliated entities for the future transfer of receivables into a trust. Given that U.S. Cellular has the power to direct the activities of this SPE, and that this SPE lacks sufficient equity to finance its activities, U.S. Cellular is deemed to have a controlling financial interest in the SPE and, therefore, consolidates it. During the six months ended June 30, 2017 , net equipment installment plan receivables totaling $ 883 million were transferred to the newly formed SPE from affiliated entities. There were no receivables transferred as of December 31, 2016. Because TDS fully consolidates USCC EIP LLC, the transfer of receivables into this SPE did not have a material impact to the consolidated financial statements of TDS. As of June 30, 2017 , TDS had not executed a securitized borrowing from a third party specific to its equipment installment plan receivables. The following VIEs were formed to participate in FCC auctions of wireless spectrum and to fund, establish, and provide wireless service with respect to any FCC licenses won in the auctions: Advantage Spectrum, L.P. (Advantage Spectrum) and Sunshine Spectrum, Inc. (Sunshine Spectrum), the general partner of Advantage Spectrum (former general partner was Frequency Advantage, L.P. (Frequency Advantage)); Aquinas Wireless, L.P. (Aquinas Wireless); and King Street Wireless, L.P. (King Street Wireless) and King Street Wireless, Inc., the general partner of King Street Wireless. These particular VIEs are collectively referred to as designated entities. The power to direct the activities that most significantly impact the economic performance of these VIEs is shared. Specifically, the general partner of these VIEs has the exclusive right to manage, operate and control the limited partnerships and make all decisions to carry on the business of the partnerships. The general partner of each partnership needs the consent of the limited partner, an indirect TDS subsidiary, to sell or lease certain licenses, to make certain large expenditures, admit other partners or liquidate the limited partnerships. Although the power to direct the activities of these VIEs is shared, TDS has the most significant level of exposure to the variability associated with the economic performance of the VIEs, indicating that TDS is the primary beneficiary of the VIEs. Therefore, in accordance with GAAP, these VIEs are consolidated. In January 2017, Sunshine Spectrum and the other owner of Frequency Advantage (the previous general partner of Advantage Spectrum) completed a series of transactions whereby Frequency Advantage was dissolved and Sunshine Spectrum became the new general partner of Advantage Spectrum. Consistent with its previous treatment of Frequency Advantage and in accordance with GAAP, TDS consolidates Sunshine Spectrum in its financial statements. TDS also consolidates other VIEs that are limited partnerships that provide wireless service. A limited partnership is a variable interest entity unless the limited partners hold substantive participating rights or kick-out rights over the general partner. For certain limited partnerships, U.S. Cellular is the general partner and manages the operations. In these partnerships, the limited partners do not have substantive kick-out or participating rights and, further, such limited partners do not have the authority to remove the general partner. Therefore, these limited partnerships are also recognized as VIEs and are consolidated under the variable interest model. The following table presents the classification and balances of the consolidated VIEs’ assets and liabilities in TDS’ Consolidated Balance Sheet. June 30, December 31, 2017 2016 (Dollars in millions) Assets Cash and cash equivalents $ 2 $ 2 Accounts receivable 402 39 Other current assets 6 6 Licenses 649 649 Property, plant and equipment, net 87 93 Other assets and deferred charges 241 15 Total assets $ 1,387 $ 804 Liabilities Current liabilities $ 40 $ 18 Deferred liabilities and credits 12 12 Total liabilities $ 52 $ 30 Unconsolidated VIEs TDS manages the operations of and holds a variable interest in certain other limited partnerships, but is not the primary beneficiary of these entities and, therefore, does not consolidate them under the variable interest model. TDS’ total investment in these unconsolidated entities was $ 4 million and $ 6 million at June 30, 2017 and December 31, 2016 , respectively, and is included in Investments in unconsolidated entities in TDS’ Consolidated Balance Sheet. The maximum exposure from unconsolidated VIEs is limited to the investment held by TDS in those entities. Other Related Matters TDS made contributions, loans and/or advances to its VIEs totaling $ 676 million, of which $ 659 million is related to USCC EIP LLC as discussed above, and $ 26 million during the six months ended June 30, 2017 and June 30, 2016 , respectively. TDS may agree to make additional capital contributions and/or advances to these or other VIEs and/or to their general partners to provide additional funding for operations or the development of licenses granted in various auctions. TDS may finance such amounts with a combination of cash on hand, borrowings under its revolving credit agreement and/or other long-term debt. There is no assurance that TDS will be able to obtain additional financing on commercially reasonable terms or at all to provide such financial support.

Noncontrolling Interests

Noncontrolling Interests	6 Months Ended
	Jun. 30, 2017
Noncontrolling Interests [Abstract]
Noncontrolling Interests	Note 9 Noncontrolling Interests The following schedule discloses the effects of Net income attributable to TDS shareholders and changes in TDS’ ownership interest in U.S. Cellular on TDS’ equity: Six Months Ended June 30, 2017 2016 (Dollars in millions) Net income attributable to TDS shareholders $ 47 $ 36 Transfer (to) from the noncontrolling interests Change in TDS' Capital in excess of par value from U.S. Cellular's issuance of U.S. Cellular shares (11) (15) Change in TDS' Capital in excess of par value from U.S. Cellular's repurchases of U.S. Cellular shares – – Purchase of ownership in subsidiaries from noncontrolling interests – – Net transfers (to) from noncontrolling interests (11) (15) Change from net income attributable to TDS and transfers (to) from noncontrolling interests $ 36 $ 21

Business Segment Information

Business Segment Information	6 Months Ended
	Jun. 30, 2017
Business Segment Information [Abstract]
Business Segment Information	Note 10 Business Segment Information U.S. Cellular and TDS Telecom are billed for all services they receive from TDS, consisting primarily of information processing, accounting and finance, and general management services. Such billings are based on expenses specifically identified to U.S. Cellular and TDS Telecom and on allocations of common expenses. Management believes the method used to allocate common expenses is reasonable and that all expenses and costs applicable to U.S. Cellular and TDS Telecom are reflected in the accompanying business segment information on a basis that is representative of what they would have been if U.S. Cellular and TDS Telecom operated on a stand-alone basis. Financial data for TDS’ reportable segments for the three and six month periods ended, or as of June 30, 2017 and 2016 , is as follows. See Note 1 — Basis of Presentation for additional information. TDS Telecom Three Months Ended or as of June 30, 2017 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 740 $ 180 $ 51 $ 27 $ (1) $ 258 $ (6) $ 992 Equipment and product sales 223 – – 23 – 24 8 255 Total operating revenues 1 963 181 51 51 (1) 281 3 1,247 Cost of services (excluding Depreciation, amortization and accretion reported below) 189 65 24 21 (1) 110 (1) 298 Cost of equipment and products 260 1 – 19 – 20 7 287 Selling, general and administrative 351 48 13 10 – 72 (4) 419 Depreciation, amortization and accretion 155 37 11 7 – 55 1 211 (Gain) loss on asset disposals, net 5 – – – – 1 – 6 (Gain) loss on license sales and exchanges, net (2) – – – – – – (2) Operating income (loss) 1 5 29 3 (7) – 25 (2) 28 Equity in earnings of unconsolidated entities 33 – – – – – – 33 Interest and dividend income 1 2 1 – – – 1 1 4 Interest expense (28) – – (1) – (1) (14) (43) Other, net – – – – – – – – Income (loss) before income taxes 12 30 3 (8) – 25 (15) 22 Income tax expense (benefit) 2 – 10 – 10 Net income (loss) 12 15 (15) 12 Add back: Depreciation, amortization and accretion 155 37 11 7 – 55 1 211 (Gain) loss on asset disposals, net 5 – – – – 1 – 6 (Gain) loss on license sales and exchanges, net (2) – – – – – – (2) Interest expense 28 – – 1 – 1 14 43 Income tax expense (benefit) 2 – 10 – 10 Adjusted EBITDA 3 $ 198 $ 67 $ 14 $ – $ – $ 82 $ – $ 280 Investments in unconsolidated entities $ 414 $ 4 $ – $ – $ – $ 4 $ 34 $ 452 Total assets $ 7,077 $ 1,200 $ 611 $ 247 $ – $ 2,059 $ 242 $ 9,378 Capital expenditures $ 84 $ 33 $ 12 $ 4 $ – $ 49 $ 1 $ 134 Numbers may not foot due to rounding. TDS Telecom Three Months Ended or as of June 30, 2016 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 774 $ 175 $ 45 $ 33 $ (1) $ 252 $ (7) $ 1,019 Equipment and product sales 218 – – 47 – 48 10 276 Total operating revenues 1 992 175 45 80 (1) 300 3 1,295 Cost of services (excluding Depreciation, amortization and accretion reported below) 193 64 24 19 (1) 105 (1) 297 Cost of equipment and products 262 – – 39 – 39 8 309 Selling, general and administrative 357 49 12 15 – 76 (4) 429 Depreciation, amortization and accretion 4 154 37 9 7 – 54 2 210 (Gain) loss on asset disposals, net 5 1 – – – 1 – 6 (Gain) loss on license sales and exchanges, net (9) – – – – – – (9) Operating income (loss) 1 30 25 – – – 24 (1) 53 Equity in earnings of unconsolidated entities 37 – – – – – (1) 36 Interest and dividend income 1 2 1 – – – 1 – 3 Interest expense (28) – – (1) – (1) (14) (43) Other, net (1) – – – – – 2 1 Income (loss) before income taxes 40 25 – (1) – 24 (14) 50 Income tax expense (benefit) 2 13 10 (5) 18 Net income (loss) 27 15 (10) 32 Add back: Depreciation, amortization and accretion 4 154 37 9 7 – 54 2 210 (Gain) loss on asset disposals, net 5 1 – – – 1 – 6 (Gain) loss on license sales and exchanges, net (9) – – – – – – (9) Interest expense 28 – – 1 – 1 14 43 Income tax expense (benefit) 2 13 – – – – 10 (5) 18 Adjusted EBITDA 3 $ 218 $ 63 $ 10 $ 7 $ – $ 80 $ 2 $ 300 Investments in unconsolidated entities $ 407 $ 4 $ – $ – $ – $ 4 $ 35 $ 446 Total assets $ 7,091 $ 1,268 $ 589 $ 285 $ – $ 2,142 $ 193 $ 9,426 Capital expenditures $ 93 $ 27 $ 17 $ 2 $ – $ 46 $ 3 $ 142 Numbers may not foot due to rounding. TDS Telecom Six Months Ended or as of June 30, 2017 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 1,486 $ 359 $ 100 $ 56 $ (2) $ 513 $ (10) $ 1,989 Equipment and product sales 413 1 – 66 – 67 16 496 Total operating revenues 1 1,899 360 100 122 (2) 580 6 2,485 Cost of services (excluding Depreciation, amortization and accretion reported below) 364 129 48 42 (2) 216 – 580 Cost of equipment and products 488 1 – 55 – 56 13 557 Selling, general and administrative 691 96 25 21 – 142 (8) 825 Depreciation, amortization and accretion 307 76 21 14 – 111 4 422 (Gain) loss on asset disposals, net 9 1 1 – – 1 – 10 (Gain) loss on license sales and exchanges, net (19) – – – – – – (19) Operating income (loss) 1 59 57 5 (9) – 53 (2) 110 Equity in earnings of unconsolidated entities 66 – – – – – (1) 65 Interest and dividend income 1 5 2 – – – 2 1 8 Interest expense (56) – – (2) – (2) (27) (85) Other, net (1) – – – – – 2 1 Income (loss) before income taxes 73 60 5 (11) – 54 (28) 99 Income tax expense (benefit) 2 33 21 (10) 44 Net income (loss) 40 33 (18) 55 Add back: Depreciation, amortization and accretion 307 76 21 14 – 111 4 422 (Gain) loss on asset disposals, net 9 1 1 – – 1 – 10 (Gain) loss on license sales and exchanges, net (19) – – – – – – (19) Interest expense 56 – – 2 – 2 27 85 Income tax expense (benefit) 2 33 21 (10) 44 Adjusted EBITDA 3 $ 426 $ 137 $ 27 $ 4 $ – $ 168 $ 3 $ 597 Investments in unconsolidated entities $ 414 $ 4 $ – $ – $ – $ 4 $ 34 $ 452 Total assets $ 7,077 $ 1,200 $ 611 $ 247 $ – $ 2,059 $ 242 $ 9,378 Capital expenditures $ 145 $ 50 $ 21 $ 10 $ – $ 81 $ 4 $ 230 Numbers may not foot due to rounding. TDS Telecom Six Months Ended or as of June 30, 2016 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 1,545 $ 347 $ 90 $ 62 $ (2) $ 497 $ (10) $ 2,032 Equipment and product sales 417 1 – 82 – 84 17 518 Total operating revenues 1 1,962 348 90 144 (2) 581 7 2,550 Cost of services (excluding Depreciation, amortization and accretion reported below) 376 126 46 40 (2) 210 (1) 585 Cost of equipment and products 518 1 – 68 – 69 13 600 Selling, general and administrative 719 98 24 25 – 147 (7) 859 Depreciation, amortization and accretion 4 307 78 18 15 – 112 3 422 (Gain) loss on asset disposals, net 10 1 1 – – 2 – 12 (Gain) loss on license sales and exchanges, net (9) – – – – – – (9) Operating income (loss) 1 41 45 1 (4) – 41 (1) 81 Equity in earnings of unconsolidated entities 72 – – – – – – 72 Interest and dividend income 1 3 1 – – – 2 – 5 Interest expense (56) 1 – (2) – (1) (28) (85) Other, net – – – – – – – – Income (loss) before income taxes 60 46 1 (6) – 41 (28) 73 Income tax expense (benefit) 2 23 16 (8) 31 Net income (loss) 37 25 (20) 42 Add back: Depreciation, amortization and accretion 4 307 78 18 15 – 112 3 422 (Gain) loss on asset disposals, net 10 1 1 – – 2 – 12 (Gain) loss on license sales and exchanges, net (9) – – – – – – (9) Interest expense 56 (1) – 2 – 1 28 85 Income tax expense (benefit) 2 23 16 (8) 31 Adjusted EBITDA 3 $ 424 $ 125 $ 20 $ 11 $ – $ 156 $ 3 $ 583 Investments in unconsolidated entities $ 407 $ 4 $ – $ – $ – $ 4 $ 35 $ 446 Total assets $ 7,091 $ 1,268 $ 589 $ 285 $ – $ 2,142 $ 193 $ 9,426 Capital expenditures $ 172 $ 55 $ 30 $ 3 $ – $ 88 $ 7 $ 267 Numbers may not foot due to rounding. 1 Equipment installment plan interest income is reflected as a component of Service revenues consistent with an accounting policy change effective January 1, 2017. All prior period numbers have been recast to conform to this accounting change. See Note 1 — Basis of Presentation for additional details. 2 Income tax expense (benefit) is not provided at the individual segment level for Wireline, Cable and HMS. TDS calculates income tax expense for “TDS Telecom Total”. 3 Adjusted earnings before interest, taxes, depreciation, amortization and accretion (Adjusted EBITDA) is a segment measure reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. Adjusted EBITDA is defined as net income, adjusted for the items set forth in the reconciliation above. TDS believes Adjusted EBITDA is a useful measure of TDS’ operating results before significant recurring non-cash charges, 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. 4 During the three and six months ended June 30, 2016, TDS recorded an out-of-period adjustment attributable to the third quarter of 2014 through the first quarter of 2016 related to the over-depreciation of certain assets in the Wireline segment. TDS determined that this adjustment was not material to the quarterly periods or the annual results for 2016. As a result of this out-of-period adjustment, Depreciation, amortization and accretion expense decreased by $4 million for the three and six months ended June 30, 2016.

Summary of Significant Accounti

Summary of Significant Accounting Policies and Recent Accounting Pronouncements (Significant Accounting Policies)	6 Months Ended
	Jun. 30, 2017
Accounting Policies [Abstract]
Principles of Consolidation	The accounting policies of Telephone and Data Systems, Inc. (TDS) conform to accounting principles generally accepted in the United States of America (GAAP) as set forth in the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC). The consolidated financial statements include the accounts of TDS and subsidiaries in which it has a controlling financial interest, including TDS’ 83% -owned wireless telephone subsidiary, United States Cellular Corporation (U.S. Cellular) and TDS’ wholly-owned subsidiary, TDS Telecommunications Corporation (TDS Telecom). In addition, the consolidated financial statements include certain entities in which TDS has a variable interest that require consolidation under GAAP. All material intercompany accounts and transactions have been eliminated. TDS’ business segments reflected in this Quarterly Report on Form 10-Q for the period ended June 30, 2017 , are U.S. Cellular, Wireline, Cable, and Hosted and Managed Services (HMS) operations. TDS’ non-reportable other business activities are presented as “Corporate, Eliminations and Other”, which includes the operations of TDS’ wholly-owned subsidiary Suttle-Straus, Inc. (Suttle-Straus). Suttle-Straus’ financial results were not significant to TDS’ operations. All of TDS’ segments operate only in the United States, except for HMS, which includes an insignificant foreign operation. See Note 10 — Business Segment Information for summary financial information on each business segment.
Basis of Accounting	The unaudited consolidated financial statements included herein have been prepared by TDS pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, TDS believes that the disclosures included herein are adequate to make the information presented not misleading. Certain numbers included herein are rounded to millions for ease of presentation; however, calculated amounts and percentages are determined using the unrounded numbers. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in TDS’ Annual Report on Form 10-K (Form 10-K) for the year ended December 31, 2016 . The accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal recurring items, unless otherwise disclosed) necessary for the fair statement of TDS’ financial position as of June 30, 2017 and December 31, 2016 , its results of operations and comprehensive income for the three and six months ended June 30, 2017 and 2016, and its cash flows and changes in equity for the six months ended June 30, 2017 and 2016 . These results are not necessarily indicative of the results to be expected for the full year. TDS has not changed its significant accounting and reporting policies from those disclosed in its Form 10-K for the year ended December 31, 2016 , except as described below.
Changes in Accounting Principles	TDS equipment revenue under equipment installment plan contracts is recognized at the time the device is delivered to the end-user customer for the selling price of the device, net of any deferred imputed interest or trade-in right, if applicable. Imputed interest is reflected as a reduction to the receivable balance and recognized over the duration of the plan as Service revenues. See Note 3 — Equipment Installment Plans . Effective January 1, 2017, TDS elected to change the classification of interest income on equipment installment plan contracts from Interest and dividend income to Service revenues in the Consolidated Statement of Operations. TDS believes this classification is preferable because financing of devices as part of enrolling customers for service is an activity that is central to TDS’ operations, and it is consistent with the presentation by others in the industry. Comparative financial statements of prior years have been adjusted to apply the new classification retrospectively. As a result of this change in classification, Service revenues for the three and six months ended June 30, 2016, increased by $ 12 million and $ 24 million, respectively, from previously reported amounts, with a corresponding decrease in Interest and dividend income. In comparison, Service revenues for the three and six months ended June 30, 2017 , include $ 17 million and $ 33 million, respectively, of equipment installment plan interest income. This change did not have an impact on Income before income taxes, Net income, or Earnings per share for the three or six months ended June 30, 2016, nor did it have a cumulative impact to Retained earnings as of any date presented.
Recently Issued Accounting Pronouncements	In May 2014, the FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (ASU 2014-09) and has since amended the standard with Accounting Standards Update 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date , Accounting Standards Update 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , Accounting Standards Update 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing , Accounting Standards Update 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients , and Accounting Standards Update 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers . These standards replace existing revenue recognition rules with a single comprehensive model to use in accounting for revenue arising from contracts with customers. TDS is required to adopt ASU 2014-09, as amended, on January 1, 2018. Early adoption as of January 1, 2017, is permitted; however, TDS did not adopt early. ASU 2014-09, as amended, impacts TDS’ revenue recognition related to the allocation of contract revenues between various services and equipment, and the timing of when those revenues are recognized. In addition, ASU 2014-09 requires deferral of incremental contract acquisition and fulfillment costs and subsequent expense recognition over the contract period or expected customer life. TDS has identified that new systems, processes and controls are required to adopt ASU 2014-09, as amended. TDS has substantially completed the design and development of new systems to perform revenue recognition accounting under the provisions of ASU 2014-09, as amended, and is currently engaged in the process of testing these new systems. TDS expects to transition to the new standard under the modified retrospective transition method whereby a cumulative effect adjustment to retained earnings is recognized upon adoption and the guidance is applied prospectively. Upon adoption, the cumulative effect adjustment is expected to include the establishment of contract asset and contract liability accounts with a corresponding adjustment to retained earnings to reflect the reallocation of revenues between service and equipment performance obligations for which control is transferred to customers in different periods. Reallocation impacts generally arise when bundle discounts are provided in a contract arrangement that includes equipment and service performance obligations. In these cases, the revenue will be reallocated according to the relative stand-alone selling prices of the performance obligations included in the bundle and this may be different than how the revenue is billed to the customer and recognized under current guidance. In addition, contract cost assets will be established to reflect costs that will be deferred as incremental contract acquisition and fulfillment costs. Incremental contract acquisition costs generally relate to commissions paid to sales associates while fulfillment costs are generally related to service installation costs on the wireline and cable businesses. TDS is evaluating the effects that adoption of ASU 2014-09, as amended, will have on its financial position and results of operations. In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (ASU 2016-02). ASU 2016-02 requires lessees to record a right-of-use asset and lease liability for almost all leases. This ASU does not substantially impact the lessor accounting model. However, some changes to the lessor accounting guidance were made to align with lessee accounting changes within Accounting Standards Codification (ASC) 842, Leases and certain key aspects of ASC 606, Revenue from Contracts with Customers. TDS is required to adopt ASU 2016-02 on January 1, 2019. Early adoption is permitted. Upon adoption of ASU 2016-02, TDS expects a substantial increase to assets and liabilities on its balance sheet. TDS is evaluating the effects that adoption of ASU 2016-02 will have on its results of operations. In June 2016, the FASB issued Accounting Standards Update 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments (ASU 2016-13). ASU 2016-13 requires entities to use a new forward-looking, expected loss model to estimate credit losses. It also requires additional disclosure relating to the credit quality of trade and other receivables, including information relating to management’s estimate of credit allowances. TDS is required to adopt ASU 2016-13 on January 1, 2020. Early adoption as of January 1, 2019 is permitted. TDS is evaluating the effects that adoption of ASU 2016-13 will have on its financial position, results of operations and disclosures. In December 2016, the FASB issued Accounting Standards Update 2016-19 Technical Corrections and Improvements (ASU 2016-19). ASU 2016-19 includes an amendment to Accounting Standards Codification Subtopic 350-40, Intangibles – Goodwill and Other – Internal-Use Software, which clarifies that a software license within the scope of the Subtopic will be accounted for as the acquisition of an intangible asset and the incurrence of a liability to the extent that the license fees are not fully paid at acquisition. TDS adopted this standard prospectively for all arrangements entered into or materially modified after January 1, 2017. In January 2017, the FASB issued Accounting Standards Update 2017-04, Intangibles – Goodwill and Other: Simplifying the Test for Goodwill Impairment (ASU 2017-04). ASU 2017-04 eliminates Step 2 of the current goodwill impairment test. Goodwill impairment loss will be measured as the amount by which a reporting unit’s carrying amount exceeds its fair value. TDS is required to adopt ASU 2017-04 on January 1, 2020. Early adoption is permitted. TDS is assessing whether it will early adopt ASU 2017-04. In February 2017, the FASB issued Accounting Standards Update 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets: Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets (ASU 2017-05). ASU 2017-05 clarifies how entities account for the derecognition of a nonfinancial asset and adds guidance for partial sales of nonfinancial assets. TDS is required to adopt ASU 2017-05 on January 1, 2018. Early adoption is permitted. The adoption of ASU 2017-05 is not expected to have a significant impact on TDS’ financial position or results of operations. In March 2017, the FASB issued Accounting Standards Update 2017-07, Compensation – Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (ASU 2017-07). ASU 2017-07 requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net periodic benefit cost must be presented separately from the service cost component and outside of Operating income in the Consolidated Statement of Operations. The guidance also specifies that only the service cost component of net benefit cost is eligible for capitalization. TDS is required to adopt ASU 2017-07 on January 1, 2018. Early adoption is permitted. The adoption of ASU 2017-07 is not expected to have a significant impact on TDS’ results of operations. In May 2017, the FASB issued Accounting Standards Update 2017-09, Compensation – Stock Compensation (ASU 2017-09). ASU 2017-09 clarifies when changes to the terms or conditions of share-based payment awards must be accounted for as modifications. TDS is required to adopt ASU 2017-09 on January 1, 2018. Early adoption is permitted. The adoption of ASU 2017-09 is not expected to have a significant impact on TDS’ financial position or results of operations.
Variable Interest Entities	TDS consolidates variable interest entities (VIEs) in which it has a controlling financial interest as defined by GAAP and is therefore deemed the primary beneficiary. A controlling financial interest will have both of the following characteristics: (a) the power to direct the VIE activities that most significantly impact economic performance and (b) the obligation to absorb the VIE losses and right to receive benefits that are significant to the VIE. TDS reviews these criteria initially at the time it enters into agreements and subsequently when events warranting reconsideration occur. These VIEs have risks similar to those described in the “Risk Factors” in TDS’ Form 10-K for the year ended December 31, 2016 .

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	6 Months Ended
	Jun. 30, 2017
Fair Value Disclosures [Abstract]
Fair value measurements	TDS has applied the provisions of fair value accounting for purposes of computing the fair value of financial instruments for disclosure purposes as displayed below. Level within the Fair Value Hierarchy June 30, 2017 December 31, 2016 Book Value Fair Value Book Value Fair Value (Dollars in millions) Cash and cash equivalents 1 $ 791 $ 791 $ 900 $ 900 Long-term debt Retail 2 1,753 1,815 1,753 1,741 Institutional 2 533 552 533 532 Other 2 202 201 208 207

Equipment Installment Plans (Ta

Equipment Installment Plans (Table)	6 Months Ended
	Jun. 30, 2017
Receivables [Abstract]
Equipment installment plan receivables	The following table summarizes equipment installment plan receivables as of June 30, 2017 and December 31, 2016 . June 30, 2017 December 31, 2016 (Dollars in millions) Equipment installment plan receivables, gross $ 722 $ 628 Deferred interest (63) (53) Equipment installment plan receivables, net of deferred interest 659 575 Allowance for credit losses (57) (50) Equipment installment plan receivables, net $ 602 $ 525 Net balance presented in the Consolidated Balance Sheet as: Accounts receivable — Customers and agents (Current portion) $ 363 $ 345 Other assets and deferred charges (Non-current portion) 239 180 Equipment installment plan receivables, net $ 602 $ 525
Equipment installment plan receivables credit categories	The balance and aging of the equipment installment plan receivables on a gross basis by credit category were as follows: June 30, 2017 December 31, 2016 Lower Risk Higher Risk Total Lower Risk Higher Risk Total (Dollars in millions) Unbilled $ 636 $ 48 $ 684 $ 553 $ 38 $ 591 Billed — current 25 2 27 23 2 25 Billed — past due 9 2 11 10 2 12 Equipment installment plan receivables, gross $ 670 $ 52 $ 722 $ 586 $ 42 $ 628
Equipment installment plans allowance for credit losses	Activity for the six months ended June 30, 2017 and 2016, in the allowance for credit losses balance for the equipment installment plan receivables was as follows: June 30, 2017 June 30, 2016 (Dollars in millions) Allowance for credit losses, beginning of period $ 50 $ 26 Bad debts expense 31 28 Write-offs, net of recoveries (24) (17) Allowance for credit losses, end of period $ 57 $ 37

Earnings Per Share (Tables)

Earnings Per Share (Tables)	6 Months Ended
	Jun. 30, 2017
Earnings Per Share [Abstract]
Earnings per share	The amounts used in computing earnings per common share and the effects of potentially dilutive securities on the weighted average number of common shares were as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 (Dollars and shares in millions, except per share amounts) Basic earnings per share available to TDS common shareholders: Net income available to TDS common shareholders used in basic earnings per share $ 10 $ 28 $ 47 $ 36 Adjustments to compute diluted earnings: Noncontrolling interest adjustment – – – – Net income available to TDS common shareholders used in diluted earnings per share $ 10 $ 28 $ 47 $ 36 Weighted average number of shares used in basic earnings per share: Common Shares 104 102 103 102 Series A Common Shares 7 7 7 7 Total 111 109 110 109 Effects of dilutive securities 1 2 2 2 Weighted average number of shares used in diluted earnings per share 112 111 112 111 Basic earnings per share available to TDS common shareholders $ 0.09 $ 0.25 $ 0.43 $ 0.33 Diluted earnings per share available to TDS common shareholders $ 0.09 $ 0.25 $ 0.42 $ 0.32

Intangible Assets (Tables)

Intangible Assets (Tables)	6 Months Ended
	Jun. 30, 2017
Licenses
Licenses	Activity related to Licenses for the six months ended June 30, 2017 , is presented below. Goodwill increased by $4 million and Other intangible assets increased by $1 million in the Cable segment in 2017 due to a small acquisition of a fiber telecommunications company. There were no changes to Franchise rights during the six months ended June 30, 2017 . Licenses (Dollars in millions) Balance December 31, 2016 $ 1,895 Acquisitions 331 Transferred to Assets held for sale (4) Exchanges - Licenses received 14 Exchanges - Licenses surrendered (1) Balance June 30, 2017 $ 2,235

Investment in Unconsolidated En

Investment in Unconsolidated Entities (Tables)	6 Months Ended
	Jun. 30, 2017
Investments in Unconsolidated Entities [Abstract]
Equity method investments, summarized results of operations	The following table, which is based in part on information provided by third parties, summarizes the combined results of operations of TDS’ equity method investments. Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 (Dollars in millions) Revenues $ 1,636 $ 1,641 $ 3,251 $ 3,329 Operating expenses 1,229 1,173 2,446 2,408 Operating income 407 468 805 921 Other expense, net (2) (3) (2) (8) Net income $ 405 $ 465 $ 803 $ 913

Variable Interest Entities (Tab

Variable Interest Entities (Tables)	6 Months Ended
	Jun. 30, 2017
Variable Interest Entities [Abstract]
Consolidated VIE assets and liabilities	The following table presents the classification and balances of the consolidated VIEs’ assets and liabilities in TDS’ Consolidated Balance Sheet. June 30, December 31, 2017 2016 (Dollars in millions) Assets Cash and cash equivalents $ 2 $ 2 Accounts receivable 402 39 Other current assets 6 6 Licenses 649 649 Property, plant and equipment, net 87 93 Other assets and deferred charges 241 15 Total assets $ 1,387 $ 804 Liabilities Current liabilities $ 40 $ 18 Deferred liabilities and credits 12 12 Total liabilities $ 52 $ 30

Noncontrolling Interests (Table

Noncontrolling Interests (Tables)	6 Months Ended
	Jun. 30, 2017
Noncontrolling Interests [Abstract]
Noncontrolling interests	The following schedule discloses the effects of Net income attributable to TDS shareholders and changes in TDS’ ownership interest in U.S. Cellular on TDS’ equity: Six Months Ended June 30, 2017 2016 (Dollars in millions) Net income attributable to TDS shareholders $ 47 $ 36 Transfer (to) from the noncontrolling interests Change in TDS' Capital in excess of par value from U.S. Cellular's issuance of U.S. Cellular shares (11) (15) Change in TDS' Capital in excess of par value from U.S. Cellular's repurchases of U.S. Cellular shares – – Purchase of ownership in subsidiaries from noncontrolling interests – – Net transfers (to) from noncontrolling interests (11) (15) Change from net income attributable to TDS and transfers (to) from noncontrolling interests $ 36 $ 21

Business Segment (Tables)

Business Segment (Tables)	6 Months Ended
	Jun. 30, 2017
Business Segment Information [Abstract]
Business segment information	Financial data for TDS’ reportable segments for the three and six month periods ended, or as of June 30, 2017 and 2016 , is as follows. See Note 1 — Basis of Presentation for additional information. TDS Telecom Three Months Ended or as of June 30, 2017 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 740 $ 180 $ 51 $ 27 $ (1) $ 258 $ (6) $ 992 Equipment and product sales 223 – – 23 – 24 8 255 Total operating revenues 1 963 181 51 51 (1) 281 3 1,247 Cost of services (excluding Depreciation, amortization and accretion reported below) 189 65 24 21 (1) 110 (1) 298 Cost of equipment and products 260 1 – 19 – 20 7 287 Selling, general and administrative 351 48 13 10 – 72 (4) 419 Depreciation, amortization and accretion 155 37 11 7 – 55 1 211 (Gain) loss on asset disposals, net 5 – – – – 1 – 6 (Gain) loss on license sales and exchanges, net (2) – – – – – – (2) Operating income (loss) 1 5 29 3 (7) – 25 (2) 28 Equity in earnings of unconsolidated entities 33 – – – – – – 33 Interest and dividend income 1 2 1 – – – 1 1 4 Interest expense (28) – – (1) – (1) (14) (43) Other, net – – – – – – – – Income (loss) before income taxes 12 30 3 (8) – 25 (15) 22 Income tax expense (benefit) 2 – 10 – 10 Net income (loss) 12 15 (15) 12 Add back: Depreciation, amortization and accretion 155 37 11 7 – 55 1 211 (Gain) loss on asset disposals, net 5 – – – – 1 – 6 (Gain) loss on license sales and exchanges, net (2) – – – – – – (2) Interest expense 28 – – 1 – 1 14 43 Income tax expense (benefit) 2 – 10 – 10 Adjusted EBITDA 3 $ 198 $ 67 $ 14 $ – $ – $ 82 $ – $ 280 Investments in unconsolidated entities $ 414 $ 4 $ – $ – $ – $ 4 $ 34 $ 452 Total assets $ 7,077 $ 1,200 $ 611 $ 247 $ – $ 2,059 $ 242 $ 9,378 Capital expenditures $ 84 $ 33 $ 12 $ 4 $ – $ 49 $ 1 $ 134 Numbers may not foot due to rounding. TDS Telecom Three Months Ended or as of June 30, 2016 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 774 $ 175 $ 45 $ 33 $ (1) $ 252 $ (7) $ 1,019 Equipment and product sales 218 – – 47 – 48 10 276 Total operating revenues 1 992 175 45 80 (1) 300 3 1,295 Cost of services (excluding Depreciation, amortization and accretion reported below) 193 64 24 19 (1) 105 (1) 297 Cost of equipment and products 262 – – 39 – 39 8 309 Selling, general and administrative 357 49 12 15 – 76 (4) 429 Depreciation, amortization and accretion 4 154 37 9 7 – 54 2 210 (Gain) loss on asset disposals, net 5 1 – – – 1 – 6 (Gain) loss on license sales and exchanges, net (9) – – – – – – (9) Operating income (loss) 1 30 25 – – – 24 (1) 53 Equity in earnings of unconsolidated entities 37 – – – – – (1) 36 Interest and dividend income 1 2 1 – – – 1 – 3 Interest expense (28) – – (1) – (1) (14) (43) Other, net (1) – – – – – 2 1 Income (loss) before income taxes 40 25 – (1) – 24 (14) 50 Income tax expense (benefit) 2 13 10 (5) 18 Net income (loss) 27 15 (10) 32 Add back: Depreciation, amortization and accretion 4 154 37 9 7 – 54 2 210 (Gain) loss on asset disposals, net 5 1 – – – 1 – 6 (Gain) loss on license sales and exchanges, net (9) – – – – – – (9) Interest expense 28 – – 1 – 1 14 43 Income tax expense (benefit) 2 13 – – – – 10 (5) 18 Adjusted EBITDA 3 $ 218 $ 63 $ 10 $ 7 $ – $ 80 $ 2 $ 300 Investments in unconsolidated entities $ 407 $ 4 $ – $ – $ – $ 4 $ 35 $ 446 Total assets $ 7,091 $ 1,268 $ 589 $ 285 $ – $ 2,142 $ 193 $ 9,426 Capital expenditures $ 93 $ 27 $ 17 $ 2 $ – $ 46 $ 3 $ 142 Numbers may not foot due to rounding. TDS Telecom Six Months Ended or as of June 30, 2017 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 1,486 $ 359 $ 100 $ 56 $ (2) $ 513 $ (10) $ 1,989 Equipment and product sales 413 1 – 66 – 67 16 496 Total operating revenues 1 1,899 360 100 122 (2) 580 6 2,485 Cost of services (excluding Depreciation, amortization and accretion reported below) 364 129 48 42 (2) 216 – 580 Cost of equipment and products 488 1 – 55 – 56 13 557 Selling, general and administrative 691 96 25 21 – 142 (8) 825 Depreciation, amortization and accretion 307 76 21 14 – 111 4 422 (Gain) loss on asset disposals, net 9 1 1 – – 1 – 10 (Gain) loss on license sales and exchanges, net (19) – – – – – – (19) Operating income (loss) 1 59 57 5 (9) – 53 (2) 110 Equity in earnings of unconsolidated entities 66 – – – – – (1) 65 Interest and dividend income 1 5 2 – – – 2 1 8 Interest expense (56) – – (2) – (2) (27) (85) Other, net (1) – – – – – 2 1 Income (loss) before income taxes 73 60 5 (11) – 54 (28) 99 Income tax expense (benefit) 2 33 21 (10) 44 Net income (loss) 40 33 (18) 55 Add back: Depreciation, amortization and accretion 307 76 21 14 – 111 4 422 (Gain) loss on asset disposals, net 9 1 1 – – 1 – 10 (Gain) loss on license sales and exchanges, net (19) – – – – – – (19) Interest expense 56 – – 2 – 2 27 85 Income tax expense (benefit) 2 33 21 (10) 44 Adjusted EBITDA 3 $ 426 $ 137 $ 27 $ 4 $ – $ 168 $ 3 $ 597 Investments in unconsolidated entities $ 414 $ 4 $ – $ – $ – $ 4 $ 34 $ 452 Total assets $ 7,077 $ 1,200 $ 611 $ 247 $ – $ 2,059 $ 242 $ 9,378 Capital expenditures $ 145 $ 50 $ 21 $ 10 $ – $ 81 $ 4 $ 230 Numbers may not foot due to rounding. TDS Telecom Six Months Ended or as of June 30, 2016 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 1,545 $ 347 $ 90 $ 62 $ (2) $ 497 $ (10) $ 2,032 Equipment and product sales 417 1 – 82 – 84 17 518 Total operating revenues 1 1,962 348 90 144 (2) 581 7 2,550 Cost of services (excluding Depreciation, amortization and accretion reported below) 376 126 46 40 (2) 210 (1) 585 Cost of equipment and products 518 1 – 68 – 69 13 600 Selling, general and administrative 719 98 24 25 – 147 (7) 859 Depreciation, amortization and accretion 4 307 78 18 15 – 112 3 422 (Gain) loss on asset disposals, net 10 1 1 – – 2 – 12 (Gain) loss on license sales and exchanges, net (9) – – – – – – (9) Operating income (loss) 1 41 45 1 (4) – 41 (1) 81 Equity in earnings of unconsolidated entities 72 – – – – – – 72 Interest and dividend income 1 3 1 – – – 2 – 5 Interest expense (56) 1 – (2) – (1) (28) (85) Other, net – – – – – – – – Income (loss) before income taxes 60 46 1 (6) – 41 (28) 73 Income tax expense (benefit) 2 23 16 (8) 31 Net income (loss) 37 25 (20) 42 Add back: Depreciation, amortization and accretion 4 307 78 18 15 – 112 3 422 (Gain) loss on asset disposals, net 10 1 1 – – 2 – 12 (Gain) loss on license sales and exchanges, net (9) – – – – – – (9) Interest expense 56 (1) – 2 – 1 28 85 Income tax expense (benefit) 2 23 16 (8) 31 Adjusted EBITDA 3 $ 424 $ 125 $ 20 $ 11 $ – $ 156 $ 3 $ 583 Investments in unconsolidated entities $ 407 $ 4 $ – $ – $ – $ 4 $ 35 $ 446 Total assets $ 7,091 $ 1,268 $ 589 $ 285 $ – $ 2,142 $ 193 $ 9,426 Capital expenditures $ 172 $ 55 $ 30 $ 3 $ – $ 88 $ 7 $ 267 Numbers may not foot due to rounding. 1 Equipment installment plan interest income is reflected as a component of Service revenues consistent with an accounting policy change effective January 1, 2017. All prior period numbers have been recast to conform to this accounting change. See Note 1 — Basis of Presentation for additional details. 2 Income tax expense (benefit) is not provided at the individual segment level for Wireline, Cable and HMS. TDS calculates income tax expense for “TDS Telecom Total”. 3 Adjusted earnings before interest, taxes, depreciation, amortization and accretion (Adjusted EBITDA) is a segment measure reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. Adjusted EBITDA is defined as net income, adjusted for the items set forth in the reconciliation above. TDS believes Adjusted EBITDA is a useful measure of TDS’ operating results before significant recurring non-cash charges, 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. 4 During the three and six months ended June 30, 2016, TDS recorded an out-of-period adjustment attributable to the third quarter of 2014 through the first quarter of 2016 related to the over-depreciation of certain assets in the Wireline segment. TDS determined that this adjustment was not material to the quarterly periods or the annual results for 2016. As a result of this out-of-period adjustment, Depreciation, amortization and accretion expense decreased by $4 million for the three and six months ended June 30, 2016.

Basis of Presentation (Details)

Basis of Presentation (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Basis of Presentation [Line Items]
Amounts recorded gross in revenues that are billed to customers and remitted to governmental authorities	$ 20	$ 22	$ 38	$ 45
Equipment Installment Plans Accounting Change
Service revenue	992	1,019	1,989	2,032
Interest and dividend income	4	3	8	5
Adjustment
Equipment Installment Plans Accounting Change
Service revenue	$ 17	12	$ 33	24
Interest and dividend income		$ (12)		$ (24)
U.S. Cellular
Basis of Presentation [Line Items]
TDS ownership of U.S. Cellular	83.00%		83.00%

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016	Dec. 31, 2015
Financial Instruments
Cash and cash equivalents	$ 791	$ 900	$ 899	$ 985
Institutional and Other | Minimum
Financial Instruments
Fair value assumption, interest rate	0.00%	0.00%
Institutional and Other | Maximum
Financial Instruments
Fair value assumption, interest rate	6.55%	6.93%
Fair Value | Level 1
Financial Instruments
Cash and cash equivalents	$ 791	$ 900
Fair Value | Level 2 | Retail
Financial Instruments
Long-term debt	1,815	1,741
Fair Value | Level 2 | Institutional
Financial Instruments
Long-term debt	552	532
Fair Value | Level 2 | Other
Financial Instruments
Long-term debt	201	207
Book Value
Financial Instruments
Cash and cash equivalents	791	900
Book Value | Retail
Financial Instruments
Long-term debt	1,753	1,753
Book Value | Institutional
Financial Instruments
Long-term debt	533	533
Book Value | Other
Financial Instruments
Long-term debt	$ 202	$ 208

Equipment Installment Plan Rece

Equipment Installment Plan Receivables, EIP Receivables (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Equipment installment plans [Line Items]
Equipment installment plan receivables, gross	$ 722	$ 628
Deferred interest	(63)	(53)
Equipment installment plan receivables, net of deferred interest	659	575
Allowance for credit losses	(57)	(50)
Equipment installment plan receivables, net	602	525
Accounts receivable - Customers and agents
Equipment installment plans [Line Items]
Equipment installment plan receivables, net	363	345
Other assets and deferred charges
Equipment installment plans [Line Items]
Equipment installment plan receivables, net	$ 239	$ 180

Equipment Installment Plan Re30

Equipment Installment Plan Receivables, Gross Receivables by Credit Category (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables, gross	$ 722	$ 628
Unbilled
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	684	591
Billed
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	27	25
Equipment installment plan receivables, past due	11	12
Lower Risk
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables, gross	670	586
Lower Risk | Unbilled
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	636	553
Lower Risk | Billed
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	25	23
Equipment installment plan receivables, past due	9	10
Higher Risk
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables, gross	52	42
Higher Risk | Unbilled
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	48	38
Higher Risk | Billed
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	2	2
Equipment installment plan receivables, past due	$ 2	$ 2

Equipment Installment Plan Re31

Equipment Installment Plan Receivables, Allowance for Credit Losses (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for credit losses, beginning of period	$ 50
Allowance for credit losses, end of period	57
Equipment Installment Plan Receivable
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for credit losses, beginning of period	50	$ 26
Bad debts expense	31	28
Write-offs, net of recoveries	(24)	(17)
Allowance for credit losses, end of period	$ 57	$ 37

Equipment Installment Plan Re32

Equipment Installment Plan Receivables, Narrative (Details) - USD ($) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Equipment installment plans [Line Items]
Guarantee liability	$ 24	$ 33
Imputed interest rate	12.10%	11.20%

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Earnings per share
Net income available to TDS common shareholders used in basic earnings per share	$ 10	$ 28	$ 47	$ 36
Net income available to TDS common shareholders used in diluted earnings per share	$ 10	$ 28	$ 47	$ 36
Weighted average number of shares used in basic earnings per share	111	109	110	109
Effects of dilutive securities	1	2	2	2
Weighted average number of shares used in diluted earnings per share	112	111	112	111
Basic earnings per share available to TDS common shareholders	$ 0.09	$ 0.25	$ 0.43	$ 0.33
Diluted earnings per share available to TDS common shareholders	$ 0.09	$ 0.25	$ 0.42	$ 0.32
Earnings per share, Other disclosures
Antidilutive securities	5	4	4	4
Common Shares
Earnings per share
Weighted average number of shares used in basic earnings per share	104	102	103	102
Series A Common Shares
Earnings per share
Weighted average number of shares used in basic earnings per share	7	7	7	7

Acquisitions, Divestitures and

Acquisitions, Divestitures and Exchanges (Details) $ in Millions	1 Months Ended			3 Months Ended			6 Months Ended
	Apr. 30, 2017USD ($)	Jun. 30, 2016USD ($)	Feb. 29, 2016USD ($)	Jun. 30, 2017USD ($)	Mar. 31, 2017USD ($)	Jun. 30, 2016USD ($)	Jun. 30, 2017USD ($)	Jun. 30, 2016USD ($)
Acquisitions
Cash paid for acquisitions and licenses							$ 200	$ 46
Federal Communications Commission deposit								143
Exchanges
Cash received from divestitures and exchanges							17	17
Gain on license sales and exchanges				$ 2		$ 9	19	9
U.S. Cellular
Exchanges
Gain on license sales and exchanges				2		9	$ 19	$ 9
U.S. Cellular | License exchange 1
Exchanges
Net cash to be received			$ 28
U.S. Cellular | License exchange 1, first closing
Exchanges
Cash received from divestitures and exchanges						13
Gain on license sales and exchanges						$ 9
U.S. Cellular | License exchange 1, second closing
Exchanges
Cash received from divestitures and exchanges					$ 15
Gain on license sales and exchanges					$ 17
U.S. Cellular | Auction 1002
Acquisitions
Cash paid for acquisitions and licenses				$ 186
Federal Communications Commission deposit		$ 143
Fcc License Auction Total Licenses Won	188
Fcc License Auction Total Winning Bid	$ 329

Intangible Assets (Details)

Intangible Assets (Details) $ in Millions	6 Months Ended
	Jun. 30, 2017USD ($)
TDS Telecom Cable
Intangible assets, other disclosures
Goodwill acquired during period	$ 4
Other intangible assets acquired	1
Licenses
Licenses
Balance, beginning of period	1,895
Acquisitions	331
Transferred to Assets held for sale	(4)
Exchanges - Licenses received	14
Exchanges - Licenses surrendered	(1)
Balance, end of period	$ 2,235

Investment in Unconsolidated 36

Investment in Unconsolidated Entities (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Equity method investments, combined income statements
Revenues	$ 1,636	$ 1,641	$ 3,251	$ 3,329
Operating expenses	1,229	1,173	2,446	2,408
Operating income	407	468	805	921
Other expense, net	(2)	(3)	(2)	(8)
Net income	$ 405	$ 465	$ 803	$ 913

Variable Interest Entities, Con

Variable Interest Entities, Consolidated Balance Sheet (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016	Dec. 31, 2015
Assets
Cash and cash equivalents	$ 791	$ 900	$ 899	$ 985
Accounts receivable	749	753
Other current assets	26	32
Licenses	2,235	1,895
Property, plant and equipment, net	3,373	3,555
Other assets and deferred charges	348	434
Liabilities
Current liabilities	786	887
Consolidated Variable Interest Entities
Assets
Cash and cash equivalents	2	2
Accounts receivable	402	39
Other current assets	6	6
Licenses	649	649
Property, plant and equipment, net	87	93
Other assets and deferred charges	241	15
Total assets	1,387	804
Liabilities
Current liabilities	40	18
Deferred liabilities and credits	12	12
Total liabilities	$ 52	$ 30

Variable Interest Entities, Nar

Variable Interest Entities, Narrative (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Variable Interest Entities, Other Disclosures
Transfer of net equipment installment plan receivables	$ 883
Capital contributions, loans or advances	676	$ 26
Investment in unconsolidated entities, maximum exposure	4	$ 6
USCC EIP LLC
Variable Interest Entities, Other Disclosures
Capital contributions, loans or advances	$ 659

Noncontrolling Interests (Detai

Noncontrolling Interests (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Noncontrolling Interests [Abstract]
Net income attributable to TDS shareholders	$ 10	$ 28	$ 47	$ 36
Transfer (to) from the noncontrolling interests
Change in TDS' Capital in excess of par value from U.S. Cellular's issuance of U.S. Cellular shares			(11)	(15)
Net transfers (to) from noncontrolling interests			(11)	(15)
Change from net income attributable to TDS and transfers (to) from noncontrolling interests			$ 36	$ 21

Business Segment (Details)

Business Segment (Details) - USD ($) $ in Millions		3 Months Ended				6 Months Ended
		Jun. 30, 2017		Jun. 30, 2016		Jun. 30, 2017		Jun. 30, 2016		Dec. 31, 2016
Segment Reporting Information [Line Items]
Service		$ 992		$ 1,019		$ 1,989		$ 2,032
Equipment and product sales		255		276		496		518
Total operating revenues		1,247		1,295		2,485		2,550
Cost of services (excluding Depreciation, amortization and accretion reported below)		298		297		580		585
Cost of equipment and products		287		309		557		600
Selling, general and administrative		419		429		825		859
Depreciation, amortization and accretion		211		210		422		422
(Gain) loss on asset disposals, net		6		6		10		12
(Gain) loss on license sales and exchanges, net		(2)		(9)		(19)		(9)
Operating income (loss)		28		53		110		81
Equity in earnings of unconsolidated entities		33		36		65		72
Interest and dividend income		4		3		8		5
Interest expense		(43)		(43)		(85)		(85)
Other, net				1		1
Income before income taxes		22		50		99		73
Income tax expense (benefit)		10		18		44		31
Net income		12		32		55		42
Depreciation, amortization and accretion		211		210		422		422
(Gain) loss on asset disposals, net		6		6		10		12
(Gain) loss on license sales and exchanges, net		(2)		(9)		(19)		(9)
Interest expense		43		43		85		85
Income tax expense		10		18		44		31
Adjusted EBITDA	[1]	280		300		597		583
Investments in unconsolidated entities		452		446		452		446		$ 451
Total assets		9,378	[2]	9,426		9,378	[2]	9,426		$ 9,446	[2]
Capital expenditures		134		142		230		267
U.S. Cellular
Segment Reporting Information [Line Items]
Service	[3]	740		774		1,486		1,545
Equipment and product sales		223		218		413		417
Total operating revenues	[3]	963		992		1,899		1,962
Cost of services (excluding Depreciation, amortization and accretion reported below)		189		193		364		376
Cost of equipment and products		260		262		488		518
Selling, general and administrative		351		357		691		719
Depreciation, amortization and accretion		155		154		307		307
(Gain) loss on asset disposals, net		5		5		9		10
(Gain) loss on license sales and exchanges, net		(2)		(9)		(19)		(9)
Operating income (loss)	[3]	5		30		59		41
Equity in earnings of unconsolidated entities		33		37		66		72
Interest and dividend income	[3]	2		2		5		3
Interest expense		(28)		(28)		(56)		(56)
Other, net				(1)		(1)
Income before income taxes		12		40		73		60
Income tax expense (benefit)				13		33		23
Net income		12		27		40		37
Depreciation, amortization and accretion		155		154		307		307
(Gain) loss on asset disposals, net		5		5		9		10
(Gain) loss on license sales and exchanges, net		(2)		(9)		(19)		(9)
Interest expense		28		28		56		56
Income tax expense				13		33		23
Adjusted EBITDA	[1]	198		218		426		424
Investments in unconsolidated entities		414		407		414		407
Total assets		7,077		7,091		7,077		7,091
Capital expenditures		84		93		145		172
TDS Telecom
Segment Reporting Information [Line Items]
Service		258		252		513		497
Equipment and product sales		24		48		67		84
Total operating revenues		281		300		580		581
Cost of services (excluding Depreciation, amortization and accretion reported below)		110		105		216		210
Cost of equipment and products		20		39		56		69
Selling, general and administrative		72		76		142		147
Depreciation, amortization and accretion		55		54		111		112
(Gain) loss on asset disposals, net		1		1		1		2
Operating income (loss)		25		24		53		41
Interest and dividend income		1		1		2		2
Interest expense		(1)		(1)		(2)		(1)
Income before income taxes		25		24		54		41
Income tax expense (benefit)	[4]	10		10		21		16
Net income		15		15		33		25
Depreciation, amortization and accretion		55		54		111		112
(Gain) loss on asset disposals, net		1		1		1		2
Interest expense		1		1		2		1
Income tax expense	[4]	10		10		21		16
Adjusted EBITDA	[1]	82		80		168		156
Investments in unconsolidated entities		4		4		4		4
Total assets		2,059		2,142		2,059		2,142
Capital expenditures		49		46		81		88
TDS Telecom Wireline
Segment Reporting Information [Line Items]
Service		180		175		359		347
Equipment and product sales						1		1
Total operating revenues		181		175		360		348
Cost of services (excluding Depreciation, amortization and accretion reported below)		65		64		129		126
Cost of equipment and products		1				1		1
Selling, general and administrative		48		49		96		98
Depreciation, amortization and accretion		37		37	[5]	76		78	[5]
(Gain) loss on asset disposals, net				1		1		1
Operating income (loss)		29		25		57		45
Interest and dividend income		1		1		2		1
Interest expense								1
Income before income taxes		30		25		60		46
Depreciation, amortization and accretion		37		37	[5]	76		78	[5]
(Gain) loss on asset disposals, net				1		1		1
Interest expense								(1)
Adjusted EBITDA	[1]	67		63		137		125
Investments in unconsolidated entities		4		4		4		4
Total assets		1,200		1,268		1,200		1,268
Capital expenditures		33		27		$ 50		55
TDS Telecom Wireline | Depreciation out-of-period adjustment
Segment Reporting Information [Line Items]
Out-of-period adjustment description						During the three and six months ended June 30, 2016, TDS recorded an out-of-period adjustment attributable to the third quarter of 2014 through the first quarter of 2016 related to the over-depreciation of certain assets in the Wireline segment. TDS determined that this adjustment was not material to the quarterly periods or the annual results for 2016. As a result of this out-of-period adjustment, Depreciation, amortization and accretion expense decreased by $4 million for the three and six months ended June 30, 2016.
TDS Telecom Wireline | Depreciation, amortization and accretion | Depreciation out-of-period adjustment
Segment Reporting Information [Line Items]
Out-of-period adjustment	[5]			4				4
TDS Telecom Cable
Segment Reporting Information [Line Items]
Service		51		45		$ 100		90
Total operating revenues		51		45		100		90
Cost of services (excluding Depreciation, amortization and accretion reported below)		24		24		48		46
Selling, general and administrative		13		12		25		24
Depreciation, amortization and accretion		11		9		21		18
(Gain) loss on asset disposals, net						1		1
Operating income (loss)		3				5		1
Income before income taxes		3				5		1
Depreciation, amortization and accretion		11		9		21		18
(Gain) loss on asset disposals, net						1		1
Adjusted EBITDA	[1]	14		10		27		20
Total assets		611		589		611		589
Capital expenditures		12		17		21		30
TDS Telecom HMS
Segment Reporting Information [Line Items]
Service		27		33		56		62
Equipment and product sales		23		47		66		82
Total operating revenues		51		80		122		144
Cost of services (excluding Depreciation, amortization and accretion reported below)		21		19		42		40
Cost of equipment and products		19		39		55		68
Selling, general and administrative		10		15		21		25
Depreciation, amortization and accretion		7		7		14		15
Operating income (loss)		(7)				(9)		(4)
Interest expense		(1)		(1)		(2)		(2)
Income before income taxes		(8)		(1)		(11)		(6)
Depreciation, amortization and accretion		7		7		14		15
Interest expense		1		1		2		2
Adjusted EBITDA	[1]			7		4		11
Total assets		247		285		247		285
Capital expenditures		4		2		10		3
TDS Telecom Eliminations
Segment Reporting Information [Line Items]
Service		(1)		(1)		(2)		(2)
Total operating revenues		(1)		(1)		(2)		(2)
Cost of services (excluding Depreciation, amortization and accretion reported below)		(1)		(1)		(2)		(2)
Corporate, Eliminations and Other
Segment Reporting Information [Line Items]
Service		(6)		(7)		(10)		(10)
Equipment and product sales		8		10		16		17
Total operating revenues		3		3		6		7
Cost of services (excluding Depreciation, amortization and accretion reported below)		(1)		(1)				(1)
Cost of equipment and products		7		8		13		13
Selling, general and administrative		(4)		(4)		(8)		(7)
Depreciation, amortization and accretion		1		2		4		3
Operating income (loss)		(2)		(1)		(2)		(1)
Equity in earnings of unconsolidated entities				(1)		(1)
Interest and dividend income		1				1
Interest expense		(14)		(14)		(27)		(28)
Other, net				2		2
Income before income taxes		(15)		(14)		(28)		(28)
Income tax expense (benefit)				(5)		(10)		(8)
Net income		(15)		(10)		(18)		(20)
Depreciation, amortization and accretion		1		2		4		3
Interest expense		14		14		27		28
Income tax expense				(5)		(10)		(8)
Adjusted EBITDA	[1]			2		3		3
Investments in unconsolidated entities		34		35		34		35
Total assets		242		193		242		193
Capital expenditures		$ 1		$ 3		$ 4		$ 7
[1]	Adjusted earnings before interest, taxes, depreciation, amortization and accretion (“Adjusted EBITDA”) is a segment measure reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. Adjusted EBITDA is defined as net income, adjusted for the items set forth in the reconciliation above. TDS believes Adjusted EBITDA is a useful measure of TDS’ operating results before significant recurring non-cash charges, 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.
[2]	The consolidated total assets as of June 30, 2017 and December 31, 2016 include assets held by consolidated VIEs of $759 million and $804 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of June 30, 2017 and December 31, 2016 include certain liabilities of consolidated VIEs of $17 million for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 8 — Variable Interest Entities for additional information.
[3]	Equipment installment plan interest income is reflected as a component of Service revenues consistent with an accounting policy change effective January 1, 2017. All prior period numbers have been recast to conform to this accounting change. See Note 1 — Basis of Presentation for additional details.
[4]	Income tax expense (benefit) is not provided at the individual segment level for Wireline, Cable and HMS. TDS calculates income tax expense for "TDS Telecom Total".
[5]	During the three and six months ended June 30, 2016, TDS recorded an out-of-period adjustment attributable to the third quarter of 2014 through the first quarter of 2016 related to the over-depreciation of certain assets in the Wireline segment. TDS determined that this adjustment was not material to the quarterly periods or the annual results for 2016. As a result of this out-of-period adjustment, Depreciation, amortization and accretion expense decreased by $4 million for the three and six months ended June 30, 2016.