Document And Entity Information
Document And Entity Information | 9 Months Ended |
Sep. 30, 2020shares | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Sep. 30, 2020 |
Document Transition Report | false |
Entity File Number | 001-14157 |
Entity Registrant Name | TELEPHONE AND DATA SYSTEMS, INC. |
Entity Central Index Key | 0001051512 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | Q3 |
Amendment Flag | false |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 36-2669023 |
Entity Address, Address Line One | 30 North LaSalle Street, Suite 4000 |
Entity Address, City or Town | Chicago |
Entity Address, State or Province | IL |
Entity Address, Postal Zip Code | 60602 |
City Area Code | (312) |
Local Phone Number | 630-1900 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Smaller Reporting Company | false |
Emerging Growth Company | false |
Entity Shell Company | false |
Common Shares | |
Title of 12(b) Security | Common Shares, $.01 par value |
Trading Symbol | TDS |
Security Exchange Name | NYSE |
Entity Common Stock, Shares Outstanding | 107,051,300 |
6.625% Senior Notes | |
Title of 12(b) Security | 6.625% Senior Notes due 2045 |
Trading Symbol | TDI |
Security Exchange Name | NYSE |
6.875% Senior Notes | |
Title of 12(b) Security | 6.875% Senior Notes due 2059 |
Trading Symbol | TDE |
Security Exchange Name | NYSE |
7.0% Senior Notes | |
Title of 12(b) Security | 7.000% Senior Notes due 2060 |
Trading Symbol | TDJ |
Security Exchange Name | NYSE |
5.875% Senior Notes | |
Title of 12(b) Security | 5.875% Senior Notes due 2061 |
Trading Symbol | TDA |
Security Exchange Name | NYSE |
Series A Common Shares | |
Entity Common Stock, Shares Outstanding | 7,273,800 |
Consolidated Statement of Opera
Consolidated Statement of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Operating revenues | ||||
Total operating revenues | $ 1,324 | $ 1,321 | $ 3,849 | $ 3,840 |
Operating expenses | ||||
Selling, general and administrative | 415 | 439 | 1,227 | 1,260 |
Depreciation, amortization and accretion | 217 | 237 | 685 | 697 |
(Gain) loss on asset disposals, net | 6 | 6 | 15 | 5 |
(Gain) loss on sale of business and other exit costs, net | 0 | 0 | 0 | (1) |
(Gain) loss on license sales and exchanges, net | 0 | 2 | 0 | 0 |
Total operating expenses | 1,237 | 1,292 | 3,611 | 3,669 |
Operating income | 87 | 29 | 238 | 171 |
Investment and other income (expense) | ||||
Equity in earnings of unconsolidated entities | 48 | 44 | 138 | 129 |
Interest and dividend income | 4 | 7 | 12 | 24 |
Gain (loss) on investments | 3 | 0 | 3 | 0 |
Interest expense | (43) | (42) | (119) | (128) |
Other, net | 0 | 0 | (1) | 0 |
Total investment and other income | 12 | 9 | 33 | 25 |
Income before income taxes | 99 | 38 | 271 | 196 |
Income tax expense | 6 | 15 | 17 | 64 |
Net income | 93 | 23 | 254 | 132 |
Less: Net income attributable to noncontrolling interests, net of tax | 15 | 5 | 42 | 22 |
Net income attributable to TDS shareholders | $ 78 | $ 18 | $ 212 | $ 110 |
Basic weighted average shares outstanding (in shares) | 114 | 115 | 114 | 114 |
Basic earnings per share attributable to TDS shareholders (in dollars per share) | $ 0.68 | $ 0.15 | $ 1.85 | $ 0.96 |
Diluted weighted average shares outstanding (in shares) | 115 | 116 | 115 | 116 |
Diluted earnings per share attributable to TDS shareholders (in dollars per share) | $ 0.66 | $ 0.15 | $ 1.81 | $ 0.93 |
Service | ||||
Operating revenues | ||||
Total operating revenues | $ 1,046 | $ 1,030 | $ 3,088 | $ 3,038 |
Operating expenses | ||||
Cost of goods and services | 321 | 313 | 919 | 900 |
Equipment and product sales | ||||
Operating revenues | ||||
Total operating revenues | 278 | 291 | 761 | 802 |
Operating expenses | ||||
Cost of goods and services | $ 278 | $ 295 | $ 765 | $ 808 |
Consolidated Statement of Compr
Consolidated Statement of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 93 | $ 23 | $ 254 | $ 132 |
Change related to retirement plan Amounts included in net periodic benefit cost for the period | ||||
Amortization of prior service cost | 1 | 0 | 2 | 1 |
Comprehensive income | 94 | 23 | 256 | 133 |
Less: Net income attributable to noncontrolling interests, net of tax | 15 | 5 | 42 | 22 |
Comprehensive income attributable to TDS shareholders | $ 79 | $ 18 | $ 214 | $ 111 |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities | ||
Net income | $ 254 | $ 132 |
Add (deduct) adjustments to reconcile net income to net cash flows from operating activities | ||
Depreciation, amortization and accretion | 685 | 697 |
Bad debts expense | 55 | 80 |
Stock-based compensation expense | 39 | 47 |
Deferred income taxes, net | 217 | 23 |
Equity in earnings of unconsolidated entities | (138) | (129) |
Distributions from unconsolidated entities | 118 | 100 |
(Gain) loss on asset disposals, net | 15 | 5 |
(Gain) loss on sale of business and other exit costs, net | 0 | (1) |
(Gain) loss on investments | (3) | 0 |
Other operating activities | 1 | 4 |
Changes in assets and liabilities from operations | ||
Accounts receivable | 26 | (42) |
Equipment installment plans receivable | 13 | (42) |
Inventory | 2 | 3 |
Accounts payable | 95 | (4) |
Customer deposits and deferred revenues | (21) | (2) |
Accrued taxes | (156) | 37 |
Accrued interest | 14 | 9 |
Other assets and liabilities | (50) | (43) |
Net cash provided by operating activities | 1,166 | 874 |
Cash flows from investing activities | ||
Cash paid for additions to property, plant and equipment | (914) | (631) |
Cash paid for licenses | (169) | (257) |
Cash received from investments | 1 | 29 |
Cash paid for investments | (1) | (11) |
Cash received from divestitures and exchanges | 1 | 32 |
Other investing activities | 4 | 1 |
Net cash used in investing activities | (1,078) | (837) |
Cash flows from financing activities | ||
Issuance of long-term debt | 675 | 0 |
Repayment of long-term debt | (8) | (16) |
TDS Common Shares reissued for benefit plans, net of tax payments | (3) | (6) |
UScellular Common Shares reissued for benefit plans, net of tax payments | (11) | (8) |
Repurchase of TDS Common Shares | (14) | 0 |
Repurchase of UScellular Common Shares | (23) | (21) |
Dividends paid to TDS shareholders | (58) | (57) |
Payment of debt issuance costs | (23) | (1) |
Distributions to noncontrolling interests | (2) | (3) |
Other financing activities | 1 | 9 |
Net cash provided by (used in) financing activities | 534 | (103) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 622 | (66) |
Cash, cash equivalents and restricted cash | ||
Beginning of period | 474 | 927 |
End of period | $ 1,096 | $ 861 |
Consolidated Balance Sheet
Consolidated Balance Sheet - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 | |
Current assets | |||
Cash and cash equivalents | $ 1,076 | $ 465 | |
Accounts receivable | |||
Customers and agents, less allowances of $69 and $74, respectively | 949 | 1,005 | |
Other, less allowances of $2 and $2, respectively | 107 | 119 | |
Inventory, net | 164 | 169 | |
Prepaid expenses | 109 | 98 | |
Income taxes receivable | 226 | 36 | |
Other current assets | 39 | 29 | |
Total current assets | 2,670 | 1,921 | |
Assets held for sale | 19 | 0 | |
Licenses | 2,637 | 2,480 | |
Goodwill | 547 | 547 | |
Other intangible assets, net of accumulated amortization of $183 and $167, respectively | 219 | 239 | |
Investments in unconsolidated entities | 508 | 488 | |
Property, plant and equipment | |||
In service and under construction | 13,375 | 12,864 | |
Less: Accumulated depreciation and amortization | 9,648 | 9,337 | |
Property, plant and equipment, net | 3,727 | 3,527 | |
Operating lease right-of-use assets | 988 | 972 | |
Other assets and deferred charges | 580 | 607 | |
Total assets | [1] | 11,895 | 10,781 |
Current liabilities | |||
Current portion of long-term debt | 3 | 10 | |
Accounts payable | 399 | 374 | |
Customer deposits and deferred revenues | 168 | 189 | |
Accrued interest | 24 | 11 | |
Accrued taxes | 63 | 41 | |
Accrued compensation | 107 | 121 | |
Short-term operating lease liabilities | 125 | 116 | |
Other current liabilities | 76 | 100 | |
Total current liabilities | 965 | 962 | |
Deferred liabilities and credits | |||
Deferred income tax liability, net | 893 | 676 | |
Long-term operating lease liabilities | 938 | 931 | |
Other deferred liabilities and credits | 530 | 481 | |
Long-term debt, net | 2,970 | 2,316 | |
Commitments and contingencies | |||
Noncontrolling interests with redemption features | 10 | 11 | |
TDS shareholders’ equity | |||
Series A Common and Common Shares Authorized 290 shares (25 Series A Common and 265 Common Shares) Issued 133 shares (7 Series A Common and 126 Common Shares) Outstanding 114 shares (7 Series A Common and 107 Common Shares) and 115 shares (7 Series A Common and 108 Common Shares), respectively Par Value ($.01 per share) | 1 | 1 | |
Capital in excess of par value | 2,479 | 2,468 | |
Treasury shares, at cost, 19 and 18 Common Shares, respectively | (478) | (479) | |
Accumulated other comprehensive loss | (7) | (9) | |
Retained earnings | 2,809 | 2,672 | |
Total TDS shareholders' equity | 4,804 | 4,653 | |
Noncontrolling interests | 785 | 751 | |
Total equity | 5,589 | 5,404 | |
Total liabilities and equity | [1] | $ 11,895 | $ 10,781 |
[1] | The consolidated total assets as of September 30, 2020 and December 31, 2019, include assets held by consolidated variable interest entities (VIEs) of $1,070 million and $915 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of September 30, 2020 and December 31, 2019, include certain liabilities of consolidated VIEs of $19 million and $20 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 10 — Variable Interest Entities for additional information. |
Consolidated Balance Sheet (Par
Consolidated Balance Sheet (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 | |
Accounts receivable | |||
Customer and agent allowances | $ 69 | $ 74 | |
Other allowances | 2 | 2 | |
Other intangible assets | |||
Other intangible assets accumulated amortization | $ 183 | $ 167 | |
TDS shareholders’ equity | |||
Authorized shares (in shares) | 290,000,000 | 290,000,000 | |
Issued shares (in shares) | 133,000,000 | 133,000,000 | |
Outstanding shares (in shares) | 114,000,000 | 115,000,000 | |
Par value per share (in dollars per share) | $ 0.01 | $ 0.01 | |
Variable Interest Entities VIEs | |||
Total assets | [1] | $ 11,895 | $ 10,781 |
Series A Common Shares | |||
TDS shareholders’ equity | |||
Authorized shares (in shares) | 25,000,000 | 25,000,000 | |
Issued shares (in shares) | 7,000,000 | 7,000,000 | |
Outstanding shares (in shares) | 7,000,000 | 7,000,000 | |
Common Shares | |||
TDS shareholders’ equity | |||
Authorized shares (in shares) | 265,000,000 | 265,000,000 | |
Issued shares (in shares) | 126,000,000 | 126,000,000 | |
Outstanding shares (in shares) | 107,000,000 | 108,000,000 | |
Par value per share (in dollars per share) | $ 0.01 | $ 0.01 | |
Treasury shares at cost (in shares) | 19,000,000 | 18,000,000 | |
Consolidated Variable Interest Entity | |||
Variable Interest Entities VIEs | |||
Total assets | $ 1,780 | $ 1,799 | |
Total liabilities | 84 | 82 | |
Consolidated Variable Interest Entity | No recourse | |||
Variable Interest Entities VIEs | |||
Total liabilities | 19 | 20 | |
Consolidated Variable Interest Entity | Assets held | |||
Variable Interest Entities VIEs | |||
Total assets | $ 1,070 | $ 915 | |
[1] | The consolidated total assets as of September 30, 2020 and December 31, 2019, include assets held by consolidated variable interest entities (VIEs) of $1,070 million and $915 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of September 30, 2020 and December 31, 2019, include certain liabilities of consolidated VIEs of $19 million and $20 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 10 — Variable Interest Entities for additional information. |
Consolidated Statement of Chang
Consolidated Statement of Changes in Equity - USD ($) $ 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 | Noncontrolling interests |
Retained earnings | ASC 842 | $ 2 | $ 2 | $ 2 | |||||
Beginning balance at Dec. 31, 2018 | 5,293 | $ 1 | $ 2,432 | $ (519) | $ (10) | 2,656 | 4,560 | $ 733 |
Net income attributable to TDS shareholders | 110 | 110 | 110 | |||||
Net income attributable to noncontrolling interests classified as equity | 21 | 0 | 21 | |||||
TDS Common and Series A Common share dividends | (57) | (57) | (57) | |||||
Dividend reinvestment plan | 13 | 18 | (5) | 13 | ||||
Incentive and compensation plans | (6) | 20 | (26) | (6) | ||||
Adjust investment in subsidiaries for repurchases, issuances and other compensation plans | 5 | 10 | 10 | (5) | ||||
Stock-based compensation awards | 14 | 14 | 14 | |||||
Distributions to noncontrolling interests | (2) | 0 | (2) | |||||
Ending balance at Sep. 30, 2019 | 5,393 | 1 | 2,456 | (481) | (10) | 2,680 | 4,646 | 747 |
Beginning balance at Jun. 30, 2019 | 5,393 | 1 | 2,438 | (488) | (10) | 2,684 | 4,625 | 768 |
Net income attributable to TDS shareholders | 18 | 18 | 18 | |||||
Net income attributable to noncontrolling interests classified as equity | 5 | 0 | 5 | |||||
TDS Common and Series A Common share dividends | (19) | (19) | (19) | |||||
Dividend reinvestment plan | 4 | 7 | (3) | 4 | ||||
Adjust investment in subsidiaries for repurchases, issuances and other compensation plans | (13) | 12 | 12 | (25) | ||||
Stock-based compensation awards | 6 | 6 | 6 | |||||
Distributions to noncontrolling interests | (1) | 0 | (1) | |||||
Ending balance at Sep. 30, 2019 | 5,393 | 1 | 2,456 | (481) | (10) | 2,680 | 4,646 | 747 |
Retained earnings | 2,672 | |||||||
Beginning balance at Dec. 31, 2019 | 5,404 | 1 | 2,468 | (479) | (9) | 2,672 | 4,653 | 751 |
Net income attributable to TDS shareholders | 212 | 212 | 212 | |||||
Net income attributable to noncontrolling interests classified as equity | 43 | 0 | 43 | |||||
Other comprehensive income | 2 | 2 | 2 | |||||
TDS Common and Series A Common share dividends | (58) | (58) | (58) | |||||
Repurchase of Common Shares | (14) | (14) | (14) | |||||
Dividend reinvestment plan | 2 | 1 | 2 | (1) | 2 | |||
Incentive and compensation plans | (3) | 13 | (16) | (3) | ||||
Adjust investment in subsidiaries for repurchases, issuances and other compensation plans | (11) | (4) | (4) | (7) | ||||
Stock-based compensation awards | 14 | 14 | 14 | |||||
Distributions to noncontrolling interests | (2) | 0 | (2) | |||||
Ending balance at Sep. 30, 2020 | 5,589 | 1 | 2,479 | (478) | (7) | 2,809 | 4,804 | 785 |
Retained earnings | ASC 326 | 1 | 1 | 1 | |||||
Beginning balance at Jun. 30, 2020 | 5,503 | 1 | 2,472 | (479) | (7) | 2,751 | 4,738 | 765 |
Net income attributable to TDS shareholders | 78 | 78 | 78 | |||||
Net income attributable to noncontrolling interests classified as equity | 16 | 0 | 16 | |||||
TDS Common and Series A Common share dividends | (19) | (19) | (19) | |||||
Dividend reinvestment plan | 0 | 1 | 1 | (2) | 0 | |||
Adjust investment in subsidiaries for repurchases, issuances and other compensation plans | 5 | 1 | 1 | 4 | ||||
Stock-based compensation awards | 5 | 5 | 5 | |||||
Ending balance at Sep. 30, 2020 | 5,589 | $ 1 | $ 2,479 | $ (478) | $ (7) | $ 2,809 | $ 4,804 | $ 785 |
Retained earnings | $ 2,809 |
Consolidated Statement of Cha_2
Consolidated Statement of Changes in Equity (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Statement of Stockholders' Equity (Parenthetical) [Abstract] | ||||
TDS Common and Series A Common Share dividends (in dollars per share) | $ 0.17 | $ 0.165 | $ 0.510 | $ 0.495 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [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). Unless otherwise specified, references to accounting provisions and GAAP in these notes refer to the requirements of the FASB ASC. The consolidated financial statements include the accounts of TDS and subsidiaries in which it has a controlling financial interest, including TDS’ 82%-owned subsidiary, United States Cellular Corporation (UScellular) and TDS’ wholly-owned subsidiary, TDS Telecommunications LLC (TDS Telecom). In addition, the consolidated financial statements include certain entities in which TDS has a variable interest that requires consolidation under GAAP. Intercompany accounts and transactions have been eliminated. TDS’ business segments reflected in this Quarterly Report on Form 10-Q for the period ended September 30, 2020, are UScellular, Wireline, and Cable. TDS’ non-reportable other business activities are presented as “Corporate, Eliminations and Other”, which includes the operations of TDS’ wholly-owned hosted and managed services (HMS) subsidiary, which operates under the OneNeck IT Solutions brand, and its wholly-owned subsidiary Suttle-Straus, Inc. (Suttle-Straus). HMS’ and Suttle-Straus’ financial results were not significant to TDS’ operations. All of TDS’ segments operate only in the United States. See Note 12 — 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 annual 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, certain 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, 2019. 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 September 30, 2020 and December 31, 2019 and its results of operations, comprehensive income and changes in equity for the three and nine months ended September 30, 2020 and September 30, 2019, and its cash flows for the nine months ended September 30, 2020 and September 30, 2019. 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, 2019 except as noted below for the estimation of credit losses. Restricted Cash TDS presents restricted cash with cash and cash equivalents in the Consolidated Statement of Cash Flows. The following table provides a reconciliation of Cash and cash equivalents and restricted cash reported in the Consolidated Balance Sheet to the total of the amounts in the Consolidated Statement of Cash Flows as of September 30, 2020 and December 31, 2019. September 30, 2020 December 31, 2019 (Dollars in millions) Cash and cash equivalents $ 1,076 $ 465 Restricted cash included in Other current assets 20 9 Cash, cash equivalents and restricted cash in the statement of cash flows $ 1,096 $ 474 Recently Adopted Accounting Pronouncements In June 2016, the FASB issued Accounting Standards Update 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments and subsequently amended the standard with additional Accounting Standards Updates, collectively referred to as ASC 326. This standard requires entities to use a new forward-looking, expected loss model to estimate credit losses and requires additional disclosures relating to the credit quality of trade and other receivables. TDS adopted the provisions of ASC 326 on January 1, 2020, using a modified retrospective method. Under this method, TDS applied the new accounting standard only to the most recent period presented, recognizing the cumulative effect of the accounting change, if any, as an adjustment to the beginning balance of retained earnings. Accordingly, prior periods have not been recast to reflect the new accounting standard. The cumulative effect of applying the provisions of ASC 326 had no material impact on retained earnings. UScellular’s accounts receivable consist primarily of amounts owed by customers for wireless services and equipment sales, including sales of certain devices and accessories under installment plans, by agents and third-party distributors for sales of equipment to them, by third party vendors and by other wireless carriers whose customers have used UScellular’s wireless systems. TDS Telecom’s accounts receivable primarily consist of amounts owed by customers for services and products provided, by state and federal governments for grants and support funds, and by interexchange carriers for long-distance and data traffic, which TDS Telecom carries on its network. TDS estimates expected credit losses related to accounts receivable balances based on a review of available and relevant information including current economic conditions, projected economic conditions, historical loss experience, account aging, and other factors that could affect collectability. Expected credit losses are determined for each pool of accounts receivable balances that share similar risk characteristics. The allowance for doubtful accounts is the best estimate of the amount of expected credit losses related to existing accounts receivable. TDS does not have any off-balance sheet credit exposure related to its customers. In August 2018, the FASB issued Accounting Standards Update 2018-15, Intangibles - Goodwill and Other - Internal-Use Software: Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (ASU 2018-15). ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the existing guidance for capitalizing implementation costs for an arrangement that has a software license. The service element of a hosting arrangement will continue to be expensed as incurred. Any capitalized implementation costs will be amortized over the period of the service contract. TDS' hosting arrangements that are service contracts consist primarily of software used to perform administrative functions. TDS adopted ASU 2018-15 on January 1, 2020, using the prospective method. The adoption of ASU 2018-15 did not have a significant impact on TDS' financial position or results of operations. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Note 2 Revenue Recognition Disaggregation of Revenue In the following table, TDS' revenues are disaggregated by type of service, which represents the relevant categorization of revenues for TDS' reportable segments, and timing of recognition. Service revenues are recognized over time and Equipment and product sales are point in time. TDS Telecom Three Months Ended September 30, 2020 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 674 $ — $ — $ — $ — $ 674 Inbound roaming 42 — — — — 42 Residential — 90 62 152 — 152 Commercial — 38 11 49 — 49 Wholesale — 45 — 45 — 45 Other service 39 — — — 18 57 Service revenues from contracts with customers 755 172 74 246 18 1,019 Equipment and product sales 252 — — — 26 278 Total revenues from contracts with customers 1,007 173 74 246 44 1,297 Operating lease income 20 — — 1 6 27 Total operating revenues $ 1,027 $ 173 $ 74 $ 247 $ 50 $ 1,324 TDS Telecom Three Months Ended September 30, 2019 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 663 $ — $ — $ — $ — $ 663 Inbound roaming 54 — — — — 54 Residential — 83 52 135 — 135 Commercial — 41 10 52 — 52 Wholesale — 44 — 44 — 44 Other service 34 — — — 19 53 Service revenues from contracts with customers 751 168 62 230 19 1,001 Equipment and product sales 257 — — — 34 291 Total revenues from contracts with customers 1,008 168 62 230 53 1,292 Operating lease income 23 1 1 1 5 29 Total operating revenues $ 1,031 $ 169 $ 62 $ 231 $ 59 $ 1,321 TDS Telecom Nine Months Ended September 30, 2020 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 2,004 $ — $ — $ — $ — $ 2,004 Inbound roaming 119 — — — — 119 Residential — 260 182 441 — 441 Commercial — 115 33 149 — 149 Wholesale — 135 — 135 — 135 Other service 110 — — — 51 161 Service revenues from contracts with customers 2,233 510 215 725 51 3,009 Equipment and product sales 674 1 — 1 86 761 Total revenues from contracts with customers 2,907 511 215 726 137 3,770 Operating lease income 57 1 1 2 20 79 Total operating revenues $ 2,964 $ 512 $ 216 $ 728 $ 157 $ 3,849 TDS Telecom Nine Months Ended September 30, 2019 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 1,984 $ — $ — $ — $ — $ 1,984 Inbound roaming 132 — — — — 132 Residential — 245 152 397 — 397 Commercial — 127 32 159 — 159 Wholesale — 137 — 137 — 137 Other service 101 — — (1) 54 154 Service revenues from contracts with customers 2,217 510 183 692 54 2,963 Equipment and product sales 698 1 — 1 103 802 Total revenues from contracts with customers 2,915 511 184 693 157 3,765 Operating lease income 55 1 1 2 18 75 Total operating revenues $ 2,970 $ 512 $ 184 $ 695 $ 175 $ 3,840 Numbers may not foot due to rounding. 1 TDS Telecom Total includes eliminations between the Wireline and Cable segments. Contract Balances The following table provides balances for contract assets from contracts with customers, which are recorded in Other current assets and Other assets and deferred charges in the Consolidated Balance Sheet, and contract liabilities from contracts with customers, which are recorded in Customer deposits and deferred revenues and Other deferred liabilities and credits in the Consolidated Balance Sheet. September 30, 2020 December 31, 2019 (Dollars in millions) Contract assets $ 13 $ 10 Contract liabilities $ 189 $ 197 Revenue recognized related to contract liabilities existing at January 1, 2020 was $159 million for the nine months ended September 30, 2020. Transaction price allocated to the remaining performance obligations The following table includes estimated service revenues expected to be recognized related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period. These estimates represent service revenues to be recognized when services are delivered to customers pursuant to service plan contracts and under certain roaming agreements with other carriers. These estimates are based on contracts in place as of September 30, 2020 and may vary from actual results. As practical expedients, revenue related to contracts of less than one year, generally month-to-month contracts, and contracts with a fixed per-unit price and variable quantity, are excluded from these estimates. Service Revenues (Dollars in millions) Remainder of 2020 $ 194 2021 230 Thereafter 272 Total $ 696 Contract Cost Assets TDS expects that commission fees paid as a result of obtaining contracts are recoverable and, therefore, TDS defers and amortizes these costs. As a practical expedient, costs with an amortization period of one year or less are expensed as incurred. TDS also incurs fulfillment costs, such as installation costs, where there is an expectation that a future benefit will be realized. Deferred commission fees and fulfillment costs are amortized based on the timing of transfer of the goods or services to which the assets relate, typically the contract term. Contract cost asset balances, which are recorded in Other assets and deferred charges in the Consolidated Balance Sheet, were as follows: September 30, 2020 December 31, 2019 (Dollars in millions) Costs to obtain contracts Sales commissions $ 137 $ 146 Fulfillment costs Installation costs 11 11 Total contract cost assets $ 148 $ 157 Amortization of contract cost assets was $30 million and $91 million for the three and nine months ended September 30, 2020, respectively, and $31 million and $95 million for the three and nine months ended September 30, 2019, respectively, and was included in Selling, general and administrative expenses and Cost of services expenses. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 3 Fair Value Measurements As of September 30, 2020 and December 31, 2019, 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 September 30, 2020 December 31, 2019 Book Value Fair Value Book Value Fair Value (Dollars in millions) Cash and cash equivalents 1 $ 1,076 $ 1,076 $ 465 $ 465 Long-term debt Retail 2 2,253 2,334 1,753 1,796 Institutional 2 535 709 534 594 Other 2 259 259 84 84 The fair values of Cash and cash equivalents and Short-term investments approximate their book values due to the short-term nature of these financial instruments. Long-term debt excludes lease obligations, other installment arrangements, the current portion of Long-term debt and debt financing costs. 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 UScellular’s 7.25% 2063 Senior Notes, 7.25% 2064 Senior Notes, 6.25% Senior Notes issued in August 2020 and 6.95% Senior Notes. TDS’ “Institutional” debt consists of UScellular’s 6.7% Senior Notes which are traded over the counter. TDS’ “Other” debt consists of senior term loan credit agreements, receivables securitization agreement 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 1.25% to 4.50% and 3.55% to 6.25% at September 30, 2020 and December 31, 2019, respectively. |
Equipment Installment Plans
Equipment Installment Plans | 9 Months Ended |
Sep. 30, 2020 | |
Receivables [Abstract] | |
Equipment Installment Plans | Note 4 Equipment Installment Plans UScellular sells devices to customers under equipment installment plans 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. The following table summarizes equipment installment plan receivables as of September 30, 2020 and December 31, 2019. September 30, 2020 December 31, 2019 (Dollars in millions) Equipment installment plan receivables, gross $ 951 $ 1,008 Allowance for credit losses (75) (84) Equipment installment plan receivables, net $ 876 $ 924 Net balance presented in the Consolidated Balance Sheet as: Accounts receivable — Customers and agents (Current portion) $ 568 $ 587 Other assets and deferred charges (Non-current portion) 308 337 Equipment installment plan receivables, net $ 876 $ 924 UScellular uses various inputs, including internal data, information from 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. These credit classes are grouped into four credit categories: lowest risk, lower risk, slight risk and higher risk. A customer's assigned credit class is reviewed periodically and a change is made, if appropriate. An equipment installment plan billed amount is considered past due if not paid within 30 days. The balance and aging of the equipment installment plan receivables on a gross basis by credit category were as follows: September 30, 2020 December 31, 2019 Lowest Risk Lower Risk Slight Risk Higher Risk Total Lowest Risk Lower Risk Slight Risk Higher Risk Total (Dollars in millions) Unbilled $ 767 $ 95 $ 22 $ 10 $ 894 $ 812 $ 99 $ 23 $ 8 $ 942 Billed — current 34 4 1 1 40 37 5 2 1 45 Billed — past due 8 5 2 2 17 11 6 3 1 21 Total $ 809 $ 104 $ 25 $ 13 $ 951 $ 860 $ 110 $ 28 $ 10 $ 1,008 The balance of the equipment installment plan receivables as of September 30, 2020 on a gross basis by year of origination were as follows: 2017 2018 2019 2020 Total (Dollars in millions) Lowest Risk $ 1 $ 84 $ 337 $ 387 $ 809 Lower Risk — 7 39 58 104 Slight Risk — 2 9 14 25 Higher Risk — — 4 9 13 Total $ 1 $ 93 $ 389 $ 468 $ 951 Activity for the nine months ended September 30, 2020 and September 30, 2019, in the allowance for credit losses for equipment installment plan receivables was as follows: September 30, 2020 September 30, 2019 (Dollars in millions) Allowance for credit losses, beginning of period $ 84 $ 77 Bad debts expense 34 60 Write-offs, net of recoveries (43) (55) Allowance for credit losses, end of period $ 75 $ 82 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 5 Income Taxes The effective tax rate on Income before income taxes was 5.8% and 6.5% for the three and nine months ended September 30, 2020, respectively, and 39.1% and 32.8%, for the three and nine months ended September 30, 2019, respectively. The lower effective tax rate in 2020 as compared to 2019 is due primarily to the income tax benefits of the CARES Act enacted on March 27, 2020. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 6 Earnings Per Share Basic earnings per share attributable to TDS shareholders is computed by dividing Net income attributable to TDS shareholders by the weighted average number of Common Shares outstanding during the period. Diluted earnings per share attributable to TDS shareholders is computed by dividing Net income attributable to TDS 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 basic and diluted earnings per share attributable to TDS shareholders were as follows: Three Months Ended Nine Months Ended 2020 2019 2020 2019 (Dollars and shares in millions, except per share amounts) Net income attributable to TDS shareholders used in basic earnings per share $ 78 $ 18 $ 212 $ 110 Adjustments to compute diluted earnings: Noncontrolling interest adjustment (2) (1) (3) (2) Net income attributable to TDS shareholders used in diluted earnings per share $ 76 $ 17 $ 209 $ 108 Weighted average number of shares used in basic earnings per share: Common Shares 107 108 107 107 Series A Common Shares 7 7 7 7 Total 114 115 114 114 Effects of dilutive securities 1 1 1 2 Weighted average number of shares used in diluted earnings per share 115 116 115 116 Basic earnings per share attributable to TDS shareholders $ 0.68 $ 0.15 $ 1.85 $ 0.96 Diluted earnings per share attributable to TDS shareholders $ 0.66 $ 0.15 $ 1.81 $ 0.93 Certain Common Shares issuable upon the exercise of stock options or vesting of performance and restricted stock units were not included in weighted average diluted shares outstanding for the calculation of Diluted earnings per share attributable to TDS shareholders because their effects were antidilutive. The number of such Common Shares excluded was 4 million for both the three and nine months ended September 30, 2020, and 3 million and less than 1 million for the three and nine months ended September 30, 2019, respectively. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Note 7 Intangible Assets Activity related to Licenses for the nine months ended September 30, 2020, is presented below: Licenses (Dollars in millions) Balance at December 31, 2019 $ 2,480 Acquisitions 171 Transferred to Assets held for sale (18) Capitalized interest 4 Balance at September 30, 2020 $ 2,637 |
Investments In Unconsolidated E
Investments In Unconsolidated Entities | 9 Months Ended |
Sep. 30, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Unconsolidated Entities | Note 8 Investments in Unconsolidated Entities Investments in unconsolidated entities consist of amounts invested in entities in which TDS holds a noncontrolling interest. TDS’ Investments in unconsolidated entities are accounted for using either the equity method or measurement alternative method as shown in the table below. The carrying value of measurement alternative method investments represents cost minus any impairments plus or minus any observable price changes. September 30, 2020 December 31, 2019 (Dollars in millions) Equity method investments $ 487 $ 467 Measurement alternative method investments 21 21 Total investments in unconsolidated entities $ 508 $ 488 The following table, which is based on unaudited information provided in part by third parties, summarizes the combined results of operations of TDS’ equity method investments. Three Months Ended Nine Months Ended 2020 2019 2020 2019 (Dollars in millions) Revenues $ 1,640 $ 1,721 $ 4,889 $ 5,077 Operating expenses 1,142 1,247 3,407 3,660 Operating income 498 474 1,482 1,417 Other income (expense), net (3) (2) (2) (4) Net income $ 495 $ 472 $ 1,480 $ 1,413 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Note 9 Debt Term Loan In March 2020, TDS borrowed $50 million on its senior term loan credit agreement. This agreement was entered into in January 2020 and amended in March 2020. The interest rate on outstanding borrowings is at a rate of LIBOR plus 200 basis points. Principal reductions are due and payable in quarterly installments of $0.5 million beginning in June 2021. The remaining unpaid balance will be due and payable in January 2027. TDS believes that it was in compliance with all of the financial covenants and other requirements set forth in its senior term loan credit agreement as of September 30, 2020. Receivables Securitization Agreement In April 2020, UScellular borrowed $125 million under its receivables securitization agreement, which permits securitized borrowings using its equipment installment plan receivables. The outstanding borrowings bear interest at floating rates. In October 2020, UScellular amended and restated its receivables securitization agreement to increase its total borrowing capacity to $300 million and extend the expiration date of the agreement to December 2022. There were no significant changes to other key terms of the receivables securitization agreement. UScellular believes that it was in compliance with all of the financial covenants and other requirements set forth in its receivables securitization agreement as of September 30, 2020. As of September 30, 2020, the USCC Master Note Trust held $222 million of assets available to be pledged as collateral for the receivables securitization agreement. Other Long-Term Debt In August 2020, UScellular issued $500 million of 6.25% Senior Notes due in 2069, and received cash proceeds of $483 million after payment of debt issuance costs of $17 million. These funds will be used for general corporate purposes. Interest on the Senior Notes is payable quarterly beginning in December 2020. UScellular may redeem the Senior Notes, in whole or in part, at any time after September 2025 at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest. |
Variable Interest Entities
Variable Interest Entities | 9 Months Ended |
Sep. 30, 2020 | |
Variable Interest Entities [Abstract] | |
Variable Interest Entities | Note 10 Variable Interest Entities Consolidated VIEs TDS consolidates VIEs in which it has a controlling financial interest as defined by GAAP and is therefore deemed the primary beneficiary. TDS reviews the criteria for a controlling financial interest 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 this Form 10-Q and TDS’ Form 10-K for the year ended December 31, 2019. During 2017, UScellular formed USCC EIP LLC (Seller/Sub-Servicer), USCC Receivables Funding LLC (Transferor) and the USCC Master Note Trust (Trust), collectively the special purpose entities (SPEs), to facilitate a securitized borrowing using its equipment installment plan receivables. Under a Receivables Sale Agreement, UScellular wholly-owned, majority-owned and unconsolidated entities, collectively referred to as “affiliated entities”, transfer device equipment installment plan contracts to the Seller/Sub-Servicer. The Seller/Sub-Servicer aggregates device equipment installment plan contracts, and performs servicing, collection and all other administrative activities related to accounting for the equipment installment plan contracts. The Seller/Sub-Servicer sells the eligible equipment installment plan receivables to the Transferor, a bankruptcy remote entity, which subsequently sells the receivables to the Trust. The Trust, which is bankruptcy remote and isolated from the creditors of UScellular, will be responsible for issuing asset-backed variable funding notes (Notes), which are collateralized by the equipment installment plan receivables owned by the Trust. Given that UScellular has the power to direct the activities of these SPEs, and that these SPEs lack sufficient equity to finance their activities, UScellular is deemed to have a controlling financial interest in the SPEs and, therefore, consolidates them. All transactions with third parties (e.g., issuance of the asset-backed variable funding notes) will be accounted for as a secured borrowing due to the pledging of equipment installment plan contracts as collateral, significant continuing involvement in the transferred assets, subordinated interests of the cash flows, and continued evidence of control of the receivables. The following VIEs were formed to participate in FCC auctions of wireless spectrum licenses and to fund, establish, and provide wireless service with respect to any FCC wireless spectrum licenses won in the auctions: ▪ Advantage Spectrum, L.P. (Advantage Spectrum) and Sunshine Spectrum, Inc., the general partner of Advantage Spectrum; 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 wireless spectrum 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. 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, UScellular 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 also are 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. September 30, 2020 December 31, 2019 (Dollars in millions) Assets Cash and cash equivalents $ 19 $ 19 Accounts receivable 618 637 Inventory, net 3 5 Other current assets 18 7 Assets held for sale 18 — Licenses 637 647 Property, plant and equipment, net 108 95 Operating lease right-of-use assets 42 42 Other assets and deferred charges 317 347 Total assets $ 1,780 $ 1,799 Liabilities Current liabilities $ 26 $ 30 Long-term operating lease liabilities 38 39 Other deferred liabilities and credits 20 13 Total liabilities $ 84 $ 82 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 $5 million at both September 30, 2020 and December 31, 2019, 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 or advances to its VIEs totaling $113 million and $229 million, during the nine months ended September 30, 2020 and 2019, respectively, of which $79 million in 2020 and $199 million in 2019, are related to USCC EIP LLC as discussed above. 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 wireless spectrum licenses granted in various auctions. TDS may finance such amounts with a combination of cash on hand, borrowings under its revolving credit or receivables securitization agreements 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. The limited partnership agreement of Advantage Spectrum also provides the general partner with a put option whereby the general partner may require the limited partner, a subsidiary of UScellular, to purchase its interest in the limited partnership. The general partner’s put option related to its interest in Advantage Spectrum will be exercisable in 2021, and if not exercised at that time, will be exercisable in 2022. The greater of the carrying value of the general partner's investment or the value of the put option, net of any borrowings due to TDS, is recorded as Noncontrolling interests with redemption features in TDS’ Consolidated Balance Sheet. Also in accordance with GAAP, minority share of income or changes in the redemption value of the put option, net of interest accrued on the loans, are recorded as a component of Net income attributable to noncontrolling interests, net of tax, in TDS’ Consolidated Statement of Operations. |
Noncontrolling Interests
Noncontrolling Interests | 9 Months Ended |
Sep. 30, 2020 | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Change Due to Net Income Attributable to Parent and Effects of Changes, Net [Abstract] | |
Noncontrolling Interests | Note 11 Noncontrolling Interests The following schedule discloses the effects of Net income attributable to TDS shareholders and changes in TDS’ ownership interest in UScellular on TDS’ equity: Nine Months Ended September 30, 2020 2019 (Dollars in millions) Net income attributable to TDS shareholders $ 212 $ 110 Transfers (to) from noncontrolling interests Change in TDS' Capital in excess of par value from UScellular's issuance of UScellular shares (38) (23) Change in TDS' Capital in excess of par value from UScellular's repurchases of UScellular shares 14 6 Net transfers (to) from noncontrolling interests (24) (17) Changes from net income attributable to TDS shareholders and transfers (to) from noncontrolling interests $ 188 $ 93 |
Business Segment Information
Business Segment Information | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Business Segment Information | Note 12 Business Segment Information UScellular and TDS Telecom are billed for 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 UScellular 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 UScellular and TDS Telecom are reflected in the accompanying business segment information on a basis that is representative of what they would have been if UScellular and TDS Telecom operated on a stand-alone basis. Financial data for TDS’ reportable segments for the three and nine month periods ended, or as of September 30, 2020 and September 30, 2019, is as follows. See Note 1 — Basis of Presentation for additional information. TDS Telecom Three Months Ended or as of September 30, 2020 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 775 $ 173 $ 74 $ 247 $ 24 $ 1,046 Equipment and product sales 252 — — — 26 278 Total operating revenues 1,027 173 74 247 50 1,324 Cost of services (excluding Depreciation, amortization and accretion reported below) 203 69 31 100 18 321 Cost of equipment and products 257 — — — 21 278 Selling, general and administrative 335 51 18 69 11 415 Depreciation, amortization and accretion 161 30 20 49 7 217 (Gain) loss on asset disposals, net 6 — — — — 6 Operating income (loss) 65 23 5 28 (6) 87 Equity in earnings of unconsolidated entities 48 — — — — 48 Interest and dividend income 2 1 — 1 1 4 Gain (loss) on investments 3 — — — — 3 Interest expense (29) 1 — 1 (15) (43) Income (loss) before income taxes 89 24 5 29 (19) 99 Income tax expense (benefit) 2 4 4 (2) 6 Net income (loss) 85 25 (17) 93 Add back: Depreciation, amortization and accretion 161 30 20 49 7 217 (Gain) loss on asset disposals, net 6 — — — — 6 Gain (loss) on investments (3) — — — — (3) Interest expense 29 (1) — (1) 15 43 Income tax expense (benefit) 2 4 4 (2) 6 Adjusted EBITDA 3 $ 282 $ 53 $ 25 $ 78 $ 2 $ 362 Investments in unconsolidated entities $ 467 $ 4 $ — $ 4 $ 37 $ 508 Total assets $ 9,180 $ 1,539 $ 721 $ 2,250 $ 465 $ 11,895 Capital expenditures $ 216 $ 74 $ 18 $ 92 $ 2 $ 310 TDS Telecom Three Months Ended or as of September 30, 2019 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 774 $ 169 $ 62 $ 231 $ 25 $ 1,030 Equipment and product sales 257 — — — 34 291 Total operating revenues 1,031 169 62 231 59 1,321 Cost of services (excluding Depreciation, amortization and accretion reported below) 199 68 27 94 20 313 Cost of equipment and products 266 — — — 29 295 Selling, general and administrative 358 52 15 67 14 439 Depreciation, amortization and accretion 181 33 17 50 6 237 (Gain) loss on asset disposals, net 5 — — — 1 6 (Gain) loss on license sales and exchanges, net 2 — — — — 2 Operating income (loss) 20 16 3 20 (11) 29 Equity in earnings of unconsolidated entities 44 — — — — 44 Interest and dividend income 4 3 — 3 — 7 Interest expense (29) 1 — 1 (14) (42) Income (loss) before income taxes 39 20 4 24 (25) 38 Income tax expense (benefit) 2 15 5 (5) 15 Net income (loss) 24 18 (19) 23 Add back: Depreciation, amortization and accretion 181 33 17 50 6 237 (Gain) loss on asset disposals, net 5 — — — 1 6 (Gain) loss on license sales and exchanges, net 2 — — — — 2 Interest expense 29 (1) — (1) 14 42 Income tax expense (benefit) 2 15 5 (5) 15 Adjusted EBITDA 3 $ 256 $ 52 $ 21 $ 73 $ (4) $ 325 Investments in unconsolidated entities $ 471 $ 4 $ — $ 4 $ 36 $ 511 Total assets $ 8,291 $ 1,430 $ 644 $ 2,066 $ 524 $ 10,881 Capital expenditures $ 170 $ 61 $ 20 $ 81 $ 2 $ 253 TDS Telecom Nine Months Ended or as of September 30, 2020 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 2,290 $ 511 $ 216 $ 727 $ 71 $ 3,088 Equipment and product sales 674 1 — 1 86 761 Total operating revenues 2,964 512 216 728 157 3,849 Cost of services (excluding Depreciation, amortization and accretion reported below) 580 197 91 287 52 919 Cost of equipment and products 692 1 — 1 72 765 Selling, general and administrative 994 148 52 200 33 1,227 Depreciation, amortization and accretion 516 94 59 152 17 685 (Gain) loss on asset disposals, net 14 — 1 1 — 15 Operating income (loss) 168 73 14 87 (17) 238 Equity in earnings of unconsolidated entities 137 — — — 1 138 Interest and dividend income 6 4 1 4 2 12 Gain (loss) on investments 3 — — — — 3 Interest expense (76) 3 — 3 (46) (119) Other, net — (1) — (1) — (1) Income (loss) before income taxes 238 79 15 94 (61) 271 Income tax expense (benefit) 2 11 13 (7) 17 Net income (loss) 227 81 (54) 254 Add back: Depreciation, amortization and accretion 516 94 59 152 17 685 (Gain) loss on asset disposals, net 14 — 1 1 — 15 Gain (loss) on investments (3) — — — — (3) Interest expense 76 (3) — (3) 46 119 Income tax expense (benefit) 2 11 13 (7) 17 Adjusted EBITDA 3 $ 841 $ 169 $ 74 $ 243 $ 3 $ 1,087 Capital expenditures $ 621 $ 171 $ 49 $ 221 $ 7 $ 849 TDS Telecom Nine Months Ended or as of September 30, 2019 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 2,272 $ 512 $ 183 $ 694 $ 72 $ 3,038 Equipment and product sales 698 1 — 1 103 802 Total operating revenues 2,970 512 184 695 175 3,840 Cost of services (excluding Depreciation, amortization and accretion reported below) 568 195 79 274 58 900 Cost of equipment and products 724 1 — 1 83 808 Selling, general and administrative 1,027 148 44 193 40 1,260 Depreciation, amortization and accretion 524 99 51 150 23 697 (Gain) loss on asset disposals, net 13 (8) 1 (7) (1) 5 (Gain) loss on sale of business and other exit costs, net (1) — — — — (1) Operating income (loss) 115 78 8 86 (30) 171 Equity in earnings of unconsolidated entities 128 — — — 1 129 Interest and dividend income 14 8 1 9 1 24 Interest expense (87) 2 — 2 (43) (128) Income (loss) before income taxes 170 88 9 97 (71) 196 Income tax expense (benefit) 2 55 23 (14) 64 Net income (loss) 115 74 (57) 132 Add back: Depreciation, amortization and accretion 524 99 51 150 23 697 (Gain) loss on asset disposals, net 13 (8) 1 (7) (1) 5 (Gain) loss on sale of business and other exit costs, net (1) — — — — (1) Interest expense 87 (2) — (2) 43 128 Income tax expense (benefit) 2 55 23 (14) 64 Adjusted EBITDA 3 $ 793 $ 177 $ 61 $ 238 $ (6) $ 1,025 Capital expenditures $ 467 $ 145 $ 48 $ 193 $ 4 $ 664 Numbers may not foot due to rounding. 1 TDS Telecom Total includes eliminations between the Wireline and Cable segments. 2 Income tax expense (benefit) is not provided at the individual segment level for Wireline and Cable. 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. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policy Disclosures [Line Items] | |
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). Unless otherwise specified, references to accounting provisions and GAAP in these notes refer to the requirements of the FASB ASC. The consolidated financial statements include the accounts of TDS and subsidiaries in which it has a controlling financial interest, including TDS’ 82%-owned subsidiary, United States Cellular Corporation (UScellular) and TDS’ wholly-owned subsidiary, TDS Telecommunications LLC (TDS Telecom). In addition, the consolidated financial statements include certain entities in which TDS has a variable interest that requires consolidation under GAAP. Intercompany accounts and transactions have been eliminated. TDS’ business segments reflected in this Quarterly Report on Form 10-Q for the period ended September 30, 2020, are UScellular, Wireline, and Cable. TDS’ non-reportable other business activities are presented as “Corporate, Eliminations and Other”, which includes the operations of TDS’ wholly-owned hosted and managed services (HMS) subsidiary, which operates under the OneNeck IT Solutions brand, and its wholly-owned subsidiary Suttle-Straus, Inc. (Suttle-Straus). HMS’ and Suttle-Straus’ financial results were not significant to TDS’ operations. All of TDS’ segments operate only in the United States. See Note 12 — 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 annual 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, certain 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, 2019. 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 September 30, 2020 and December 31, 2019 and its results of operations, comprehensive income and changes in equity for the three and nine months ended September 30, 2020 and September 30, 2019, and its cash flows for the nine months ended September 30, 2020 and September 30, 2019. 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, 2019 except as noted below for the estimation of credit losses. |
Allowance for Doubtful Accounts | TDS estimates expected credit losses related to accounts receivable balances based on a review of available and relevant information including current economic conditions, projected economic conditions, historical loss experience, account aging, and other factors that could affect collectability. Expected credit losses are determined for each pool of accounts receivable balances that share similar risk characteristics. The allowance for doubtful accounts is the best estimate of the amount of expected credit losses related to existing accounts receivable. TDS does not have any off-balance sheet credit exposure related to its customers. |
Recently Adopted Accounting Pronouncements | In June 2016, the FASB issued Accounting Standards Update 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments and subsequently amended the standard with additional Accounting Standards Updates, collectively referred to as ASC 326. This standard requires entities to use a new forward-looking, expected loss model to estimate credit losses and requires additional disclosures relating to the credit quality of trade and other receivables. TDS adopted the provisions of ASC 326 on January 1, 2020, using a modified retrospective method. Under this method, TDS applied the new accounting standard only to the most recent period presented, recognizing the cumulative effect of the accounting change, if any, as an adjustment to the beginning balance of retained earnings. Accordingly, prior periods have not been recast to reflect the new accounting standard. The cumulative effect of applying the provisions of ASC 326 had no material impact on retained earnings. In August 2018, the FASB issued Accounting Standards Update 2018-15, Intangibles - Goodwill and Other - Internal-Use Software: Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (ASU 2018-15). ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the existing guidance for capitalizing implementation costs for an arrangement that has a software license. The service element of a hosting arrangement will continue to be expensed as incurred. Any capitalized implementation costs will be amortized over the period of the service contract. TDS' hosting arrangements that are service contracts consist primarily of software used to perform administrative functions. TDS adopted ASU 2018-15 on January 1, 2020, using the prospective method. The adoption of ASU 2018-15 did not have a significant impact on TDS' financial position or results of operations. |
Revenue from Contract with Customer | As practical expedients, revenue related to contracts of less than one year, generally month-to-month contracts, and contracts with a fixed per-unit price and variable quantity, are excluded from these estimates.TDS expects that commission fees paid as a result of obtaining contracts are recoverable and, therefore, TDS defers and amortizes these costs. As a practical expedient, costs with an amortization period of one year or less are expensed as incurred. TDS also incurs fulfillment costs, such as installation costs, where there is an expectation that a future benefit will be realized. Deferred commission fees and fulfillment costs are amortized based on the timing of transfer of the goods or services to which the assets relate, typically the contract term. |
Variable Interest Entities | TDS consolidates VIEs in which it has a controlling financial interest as defined by GAAP and is therefore deemed the primary beneficiary. TDS reviews the criteria for a controlling financial interest 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 this Form 10-Q and TDS’ Form 10-K for the year ended December 31, 2019. |
UScellular | |
Accounting Policy Disclosures [Line Items] | |
Accounts Receivable | UScellular’s accounts receivable consist primarily of amounts owed by customers for wireless services and equipment sales, including sales of certain devices and accessories under installment plans, by agents and third-party distributors for sales of equipment to them, by third party vendors and by other wireless carriers whose customers have used UScellular’s wireless systems. |
TDS Telecom Total | |
Accounting Policy Disclosures [Line Items] | |
Accounts Receivable | TDS Telecom’s accounts receivable primarily consist of amounts owed by customers for services and products provided, by state and federal governments for grants and support funds, and by interexchange carriers for long-distance and data traffic, which TDS Telecom carries on its network. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Reconciliation of cash, cash equivalents and restricted cash | The following table provides a reconciliation of Cash and cash equivalents and restricted cash reported in the Consolidated Balance Sheet to the total of the amounts in the Consolidated Statement of Cash Flows as of September 30, 2020 and December 31, 2019. September 30, 2020 December 31, 2019 (Dollars in millions) Cash and cash equivalents $ 1,076 $ 465 Restricted cash included in Other current assets 20 9 Cash, cash equivalents and restricted cash in the statement of cash flows $ 1,096 $ 474 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenues | In the following table, TDS' revenues are disaggregated by type of service, which represents the relevant categorization of revenues for TDS' reportable segments, and timing of recognition. Service revenues are recognized over time and Equipment and product sales are point in time. TDS Telecom Three Months Ended September 30, 2020 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 674 $ — $ — $ — $ — $ 674 Inbound roaming 42 — — — — 42 Residential — 90 62 152 — 152 Commercial — 38 11 49 — 49 Wholesale — 45 — 45 — 45 Other service 39 — — — 18 57 Service revenues from contracts with customers 755 172 74 246 18 1,019 Equipment and product sales 252 — — — 26 278 Total revenues from contracts with customers 1,007 173 74 246 44 1,297 Operating lease income 20 — — 1 6 27 Total operating revenues $ 1,027 $ 173 $ 74 $ 247 $ 50 $ 1,324 TDS Telecom Three Months Ended September 30, 2019 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 663 $ — $ — $ — $ — $ 663 Inbound roaming 54 — — — — 54 Residential — 83 52 135 — 135 Commercial — 41 10 52 — 52 Wholesale — 44 — 44 — 44 Other service 34 — — — 19 53 Service revenues from contracts with customers 751 168 62 230 19 1,001 Equipment and product sales 257 — — — 34 291 Total revenues from contracts with customers 1,008 168 62 230 53 1,292 Operating lease income 23 1 1 1 5 29 Total operating revenues $ 1,031 $ 169 $ 62 $ 231 $ 59 $ 1,321 TDS Telecom Nine Months Ended September 30, 2020 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 2,004 $ — $ — $ — $ — $ 2,004 Inbound roaming 119 — — — — 119 Residential — 260 182 441 — 441 Commercial — 115 33 149 — 149 Wholesale — 135 — 135 — 135 Other service 110 — — — 51 161 Service revenues from contracts with customers 2,233 510 215 725 51 3,009 Equipment and product sales 674 1 — 1 86 761 Total revenues from contracts with customers 2,907 511 215 726 137 3,770 Operating lease income 57 1 1 2 20 79 Total operating revenues $ 2,964 $ 512 $ 216 $ 728 $ 157 $ 3,849 TDS Telecom Nine Months Ended September 30, 2019 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 1,984 $ — $ — $ — $ — $ 1,984 Inbound roaming 132 — — — — 132 Residential — 245 152 397 — 397 Commercial — 127 32 159 — 159 Wholesale — 137 — 137 — 137 Other service 101 — — (1) 54 154 Service revenues from contracts with customers 2,217 510 183 692 54 2,963 Equipment and product sales 698 1 — 1 103 802 Total revenues from contracts with customers 2,915 511 184 693 157 3,765 Operating lease income 55 1 1 2 18 75 Total operating revenues $ 2,970 $ 512 $ 184 $ 695 $ 175 $ 3,840 Numbers may not foot due to rounding. 1 TDS Telecom Total includes eliminations between the Wireline and Cable segments. |
Contract with Customer, Assets and Liabilities | The following table provides balances for contract assets from contracts with customers, which are recorded in Other current assets and Other assets and deferred charges in the Consolidated Balance Sheet, and contract liabilities from contracts with customers, which are recorded in Customer deposits and deferred revenues and Other deferred liabilities and credits in the Consolidated Balance Sheet. September 30, 2020 December 31, 2019 (Dollars in millions) Contract assets $ 13 $ 10 Contract liabilities $ 189 $ 197 |
Remaining Performance Obligations | The following table includes estimated service revenues expected to be recognized related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period. These estimates represent service revenues to be recognized when services are delivered to customers pursuant to service plan contracts and under certain roaming agreements with other carriers. These estimates are based on contracts in place as of September 30, 2020 and may vary from actual results. As practical expedients, revenue related to contracts of less than one year, generally month-to-month contracts, and contracts with a fixed per-unit price and variable quantity, are excluded from these estimates. Service Revenues (Dollars in millions) Remainder of 2020 $ 194 2021 230 Thereafter 272 Total $ 696 |
Contract Cost Assets | TDS expects that commission fees paid as a result of obtaining contracts are recoverable and, therefore, TDS defers and amortizes these costs. As a practical expedient, costs with an amortization period of one year or less are expensed as incurred. TDS also incurs fulfillment costs, such as installation costs, where there is an expectation that a future benefit will be realized. Deferred commission fees and fulfillment costs are amortized based on the timing of transfer of the goods or services to which the assets relate, typically the contract term. Contract cost asset balances, which are recorded in Other assets and deferred charges in the Consolidated Balance Sheet, were as follows: September 30, 2020 December 31, 2019 (Dollars in millions) Costs to obtain contracts Sales commissions $ 137 $ 146 Fulfillment costs Installation costs 11 11 Total contract cost assets $ 148 $ 157 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
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 September 30, 2020 December 31, 2019 Book Value Fair Value Book Value Fair Value (Dollars in millions) Cash and cash equivalents 1 $ 1,076 $ 1,076 $ 465 $ 465 Long-term debt Retail 2 2,253 2,334 1,753 1,796 Institutional 2 535 709 534 594 Other 2 259 259 84 84 |
Equipment Installment Plans (Ta
Equipment Installment Plans (Table) | 9 Months Ended |
Sep. 30, 2020 | |
Receivables [Abstract] | |
Equipment installment plan receivables | The following table summarizes equipment installment plan receivables as of September 30, 2020 and December 31, 2019. September 30, 2020 December 31, 2019 (Dollars in millions) Equipment installment plan receivables, gross $ 951 $ 1,008 Allowance for credit losses (75) (84) Equipment installment plan receivables, net $ 876 $ 924 Net balance presented in the Consolidated Balance Sheet as: Accounts receivable — Customers and agents (Current portion) $ 568 $ 587 Other assets and deferred charges (Non-current portion) 308 337 Equipment installment plan receivables, net $ 876 $ 924 |
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: September 30, 2020 December 31, 2019 Lowest Risk Lower Risk Slight Risk Higher Risk Total Lowest Risk Lower Risk Slight Risk Higher Risk Total (Dollars in millions) Unbilled $ 767 $ 95 $ 22 $ 10 $ 894 $ 812 $ 99 $ 23 $ 8 $ 942 Billed — current 34 4 1 1 40 37 5 2 1 45 Billed — past due 8 5 2 2 17 11 6 3 1 21 Total $ 809 $ 104 $ 25 $ 13 $ 951 $ 860 $ 110 $ 28 $ 10 $ 1,008 The balance of the equipment installment plan receivables as of September 30, 2020 on a gross basis by year of origination were as follows: 2017 2018 2019 2020 Total (Dollars in millions) Lowest Risk $ 1 $ 84 $ 337 $ 387 $ 809 Lower Risk — 7 39 58 104 Slight Risk — 2 9 14 25 Higher Risk — — 4 9 13 Total $ 1 $ 93 $ 389 $ 468 $ 951 |
Equipment installment plans allowance for credit losses | Activity for the nine months ended September 30, 2020 and September 30, 2019, in the allowance for credit losses for equipment installment plan receivables was as follows: September 30, 2020 September 30, 2019 (Dollars in millions) Allowance for credit losses, beginning of period $ 84 $ 77 Bad debts expense 34 60 Write-offs, net of recoveries (43) (55) Allowance for credit losses, end of period $ 75 $ 82 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per share | The amounts used in computing basic and diluted earnings per share attributable to TDS shareholders were as follows: Three Months Ended Nine Months Ended 2020 2019 2020 2019 (Dollars and shares in millions, except per share amounts) Net income attributable to TDS shareholders used in basic earnings per share $ 78 $ 18 $ 212 $ 110 Adjustments to compute diluted earnings: Noncontrolling interest adjustment (2) (1) (3) (2) Net income attributable to TDS shareholders used in diluted earnings per share $ 76 $ 17 $ 209 $ 108 Weighted average number of shares used in basic earnings per share: Common Shares 107 108 107 107 Series A Common Shares 7 7 7 7 Total 114 115 114 114 Effects of dilutive securities 1 1 1 2 Weighted average number of shares used in diluted earnings per share 115 116 115 116 Basic earnings per share attributable to TDS shareholders $ 0.68 $ 0.15 $ 1.85 $ 0.96 Diluted earnings per share attributable to TDS shareholders $ 0.66 $ 0.15 $ 1.81 $ 0.93 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Licenses | |
Licenses | Activity related to Licenses for the nine months ended September 30, 2020, is presented below: Licenses (Dollars in millions) Balance at December 31, 2019 $ 2,480 Acquisitions 171 Transferred to Assets held for sale (18) Capitalized interest 4 Balance at September 30, 2020 $ 2,637 |
Investment in Unconsolidated En
Investment in Unconsolidated Entities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity and measurement alternative method investments | TDS’ Investments in unconsolidated entities are accounted for using either the equity method or measurement alternative method as shown in the table below. The carrying value of measurement alternative method investments represents cost minus any impairments plus or minus any observable price changes. September 30, 2020 December 31, 2019 (Dollars in millions) Equity method investments $ 487 $ 467 Measurement alternative method investments 21 21 Total investments in unconsolidated entities $ 508 $ 488 The following table, which is based on unaudited information provided in part by third parties, summarizes the combined results of operations of TDS’ equity method investments. Three Months Ended Nine Months Ended 2020 2019 2020 2019 (Dollars in millions) Revenues $ 1,640 $ 1,721 $ 4,889 $ 5,077 Operating expenses 1,142 1,247 3,407 3,660 Operating income 498 474 1,482 1,417 Other income (expense), net (3) (2) (2) (4) Net income $ 495 $ 472 $ 1,480 $ 1,413 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
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. September 30, 2020 December 31, 2019 (Dollars in millions) Assets Cash and cash equivalents $ 19 $ 19 Accounts receivable 618 637 Inventory, net 3 5 Other current assets 18 7 Assets held for sale 18 — Licenses 637 647 Property, plant and equipment, net 108 95 Operating lease right-of-use assets 42 42 Other assets and deferred charges 317 347 Total assets $ 1,780 $ 1,799 Liabilities Current liabilities $ 26 $ 30 Long-term operating lease liabilities 38 39 Other deferred liabilities and credits 20 13 Total liabilities $ 84 $ 82 |
Noncontrolling Interests (Table
Noncontrolling Interests (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Change Due to Net Income Attributable to Parent and Effects of Changes, Net [Abstract] | |
Noncontrolling interests | The following schedule discloses the effects of Net income attributable to TDS shareholders and changes in TDS’ ownership interest in UScellular on TDS’ equity: Nine Months Ended September 30, 2020 2019 (Dollars in millions) Net income attributable to TDS shareholders $ 212 $ 110 Transfers (to) from noncontrolling interests Change in TDS' Capital in excess of par value from UScellular's issuance of UScellular shares (38) (23) Change in TDS' Capital in excess of par value from UScellular's repurchases of UScellular shares 14 6 Net transfers (to) from noncontrolling interests (24) (17) Changes from net income attributable to TDS shareholders and transfers (to) from noncontrolling interests $ 188 $ 93 |
Business Segment Information (T
Business Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Business segment information | Financial data for TDS’ reportable segments for the three and nine month periods ended, or as of September 30, 2020 and September 30, 2019, is as follows. See Note 1 — Basis of Presentation for additional information. TDS Telecom Three Months Ended or as of September 30, 2020 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 775 $ 173 $ 74 $ 247 $ 24 $ 1,046 Equipment and product sales 252 — — — 26 278 Total operating revenues 1,027 173 74 247 50 1,324 Cost of services (excluding Depreciation, amortization and accretion reported below) 203 69 31 100 18 321 Cost of equipment and products 257 — — — 21 278 Selling, general and administrative 335 51 18 69 11 415 Depreciation, amortization and accretion 161 30 20 49 7 217 (Gain) loss on asset disposals, net 6 — — — — 6 Operating income (loss) 65 23 5 28 (6) 87 Equity in earnings of unconsolidated entities 48 — — — — 48 Interest and dividend income 2 1 — 1 1 4 Gain (loss) on investments 3 — — — — 3 Interest expense (29) 1 — 1 (15) (43) Income (loss) before income taxes 89 24 5 29 (19) 99 Income tax expense (benefit) 2 4 4 (2) 6 Net income (loss) 85 25 (17) 93 Add back: Depreciation, amortization and accretion 161 30 20 49 7 217 (Gain) loss on asset disposals, net 6 — — — — 6 Gain (loss) on investments (3) — — — — (3) Interest expense 29 (1) — (1) 15 43 Income tax expense (benefit) 2 4 4 (2) 6 Adjusted EBITDA 3 $ 282 $ 53 $ 25 $ 78 $ 2 $ 362 Investments in unconsolidated entities $ 467 $ 4 $ — $ 4 $ 37 $ 508 Total assets $ 9,180 $ 1,539 $ 721 $ 2,250 $ 465 $ 11,895 Capital expenditures $ 216 $ 74 $ 18 $ 92 $ 2 $ 310 TDS Telecom Three Months Ended or as of September 30, 2019 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 774 $ 169 $ 62 $ 231 $ 25 $ 1,030 Equipment and product sales 257 — — — 34 291 Total operating revenues 1,031 169 62 231 59 1,321 Cost of services (excluding Depreciation, amortization and accretion reported below) 199 68 27 94 20 313 Cost of equipment and products 266 — — — 29 295 Selling, general and administrative 358 52 15 67 14 439 Depreciation, amortization and accretion 181 33 17 50 6 237 (Gain) loss on asset disposals, net 5 — — — 1 6 (Gain) loss on license sales and exchanges, net 2 — — — — 2 Operating income (loss) 20 16 3 20 (11) 29 Equity in earnings of unconsolidated entities 44 — — — — 44 Interest and dividend income 4 3 — 3 — 7 Interest expense (29) 1 — 1 (14) (42) Income (loss) before income taxes 39 20 4 24 (25) 38 Income tax expense (benefit) 2 15 5 (5) 15 Net income (loss) 24 18 (19) 23 Add back: Depreciation, amortization and accretion 181 33 17 50 6 237 (Gain) loss on asset disposals, net 5 — — — 1 6 (Gain) loss on license sales and exchanges, net 2 — — — — 2 Interest expense 29 (1) — (1) 14 42 Income tax expense (benefit) 2 15 5 (5) 15 Adjusted EBITDA 3 $ 256 $ 52 $ 21 $ 73 $ (4) $ 325 Investments in unconsolidated entities $ 471 $ 4 $ — $ 4 $ 36 $ 511 Total assets $ 8,291 $ 1,430 $ 644 $ 2,066 $ 524 $ 10,881 Capital expenditures $ 170 $ 61 $ 20 $ 81 $ 2 $ 253 TDS Telecom Nine Months Ended or as of September 30, 2020 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 2,290 $ 511 $ 216 $ 727 $ 71 $ 3,088 Equipment and product sales 674 1 — 1 86 761 Total operating revenues 2,964 512 216 728 157 3,849 Cost of services (excluding Depreciation, amortization and accretion reported below) 580 197 91 287 52 919 Cost of equipment and products 692 1 — 1 72 765 Selling, general and administrative 994 148 52 200 33 1,227 Depreciation, amortization and accretion 516 94 59 152 17 685 (Gain) loss on asset disposals, net 14 — 1 1 — 15 Operating income (loss) 168 73 14 87 (17) 238 Equity in earnings of unconsolidated entities 137 — — — 1 138 Interest and dividend income 6 4 1 4 2 12 Gain (loss) on investments 3 — — — — 3 Interest expense (76) 3 — 3 (46) (119) Other, net — (1) — (1) — (1) Income (loss) before income taxes 238 79 15 94 (61) 271 Income tax expense (benefit) 2 11 13 (7) 17 Net income (loss) 227 81 (54) 254 Add back: Depreciation, amortization and accretion 516 94 59 152 17 685 (Gain) loss on asset disposals, net 14 — 1 1 — 15 Gain (loss) on investments (3) — — — — (3) Interest expense 76 (3) — (3) 46 119 Income tax expense (benefit) 2 11 13 (7) 17 Adjusted EBITDA 3 $ 841 $ 169 $ 74 $ 243 $ 3 $ 1,087 Capital expenditures $ 621 $ 171 $ 49 $ 221 $ 7 $ 849 TDS Telecom Nine Months Ended or as of September 30, 2019 UScellular Wireline Cable TDS Telecom Total 1 Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 2,272 $ 512 $ 183 $ 694 $ 72 $ 3,038 Equipment and product sales 698 1 — 1 103 802 Total operating revenues 2,970 512 184 695 175 3,840 Cost of services (excluding Depreciation, amortization and accretion reported below) 568 195 79 274 58 900 Cost of equipment and products 724 1 — 1 83 808 Selling, general and administrative 1,027 148 44 193 40 1,260 Depreciation, amortization and accretion 524 99 51 150 23 697 (Gain) loss on asset disposals, net 13 (8) 1 (7) (1) 5 (Gain) loss on sale of business and other exit costs, net (1) — — — — (1) Operating income (loss) 115 78 8 86 (30) 171 Equity in earnings of unconsolidated entities 128 — — — 1 129 Interest and dividend income 14 8 1 9 1 24 Interest expense (87) 2 — 2 (43) (128) Income (loss) before income taxes 170 88 9 97 (71) 196 Income tax expense (benefit) 2 55 23 (14) 64 Net income (loss) 115 74 (57) 132 Add back: Depreciation, amortization and accretion 524 99 51 150 23 697 (Gain) loss on asset disposals, net 13 (8) 1 (7) (1) 5 (Gain) loss on sale of business and other exit costs, net (1) — — — — (1) Interest expense 87 (2) — (2) 43 128 Income tax expense (benefit) 2 55 23 (14) 64 Adjusted EBITDA 3 $ 793 $ 177 $ 61 $ 238 $ (6) $ 1,025 Capital expenditures $ 467 $ 145 $ 48 $ 193 $ 4 $ 664 Numbers may not foot due to rounding. 1 TDS Telecom Total includes eliminations between the Wireline and Cable segments. 2 Income tax expense (benefit) is not provided at the individual segment level for Wireline and Cable. 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. |
Basis of Presentation - Narrati
Basis of Presentation - Narrative (Details) | Sep. 30, 2020 |
UScellular | |
Basis of Presentation [Line Items] | |
TDS ownership of UScellular | 82.00% |
Basis of Presentation - Cash, C
Basis of Presentation - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents | $ 1,076 | $ 465 | ||
Restricted cash included in Other current assets | 20 | 9 | ||
Cash, cash equivalents and restricted cash in the statement of cash flows | $ 1,096 | $ 474 | $ 861 | $ 927 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Disaggregation of revenue | ||||
Revenue from contracts with customers | $ 1,297 | $ 1,292 | $ 3,770 | $ 3,765 |
Operating lease income | 27 | 29 | 79 | 75 |
Total operating revenues | 1,324 | 1,321 | 3,849 | 3,840 |
Transferred over time | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 1,019 | 1,001 | 3,009 | 2,963 |
Transferred over time | Retail service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 674 | 663 | 2,004 | 1,984 |
Transferred over time | Inbound roaming | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 42 | 54 | 119 | 132 |
Transferred over time | Residential | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 152 | 135 | 441 | 397 |
Transferred over time | Commercial | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 49 | 52 | 149 | 159 |
Transferred over time | Wholesale | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 45 | 44 | 135 | 137 |
Transferred over time | Other service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 57 | 53 | 161 | 154 |
Transferred at point in time | Equipment and product sales | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 278 | 291 | 761 | 802 |
UScellular | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 1,007 | 1,008 | 2,907 | 2,915 |
Operating lease income | 20 | 23 | 57 | 55 |
Total operating revenues | 1,027 | 1,031 | 2,964 | 2,970 |
UScellular | Transferred over time | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 755 | 751 | 2,233 | 2,217 |
UScellular | Transferred over time | Retail service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 674 | 663 | 2,004 | 1,984 |
UScellular | Transferred over time | Inbound roaming | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 42 | 54 | 119 | 132 |
UScellular | Transferred over time | Residential | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
UScellular | Transferred over time | Commercial | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
UScellular | Transferred over time | Wholesale | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
UScellular | Transferred over time | Other service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 39 | 34 | 110 | 101 |
UScellular | Transferred at point in time | Equipment and product sales | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 252 | 257 | 674 | 698 |
TDS Telecom Total | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 246 | 230 | 726 | 693 |
Operating lease income | 1 | 1 | 2 | 2 |
Total operating revenues | 247 | 231 | 728 | 695 |
TDS Telecom Total | Transferred over time | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 246 | 230 | 725 | 692 |
TDS Telecom Total | Transferred over time | Retail service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
TDS Telecom Total | Transferred over time | Inbound roaming | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
TDS Telecom Total | Transferred over time | Residential | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 152 | 135 | 441 | 397 |
TDS Telecom Total | Transferred over time | Commercial | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 49 | 52 | 149 | 159 |
TDS Telecom Total | Transferred over time | Wholesale | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 45 | 44 | 135 | 137 |
TDS Telecom Total | Transferred over time | Other service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | (1) |
TDS Telecom Total | Transferred at point in time | Equipment and product sales | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 1 | 1 |
TDS Telecom Wireline | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 173 | 168 | 511 | 511 |
Operating lease income | 0 | 1 | 1 | 1 |
Total operating revenues | 173 | 169 | 512 | 512 |
TDS Telecom Wireline | Transferred over time | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 172 | 168 | 510 | 510 |
TDS Telecom Wireline | Transferred over time | Retail service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
TDS Telecom Wireline | Transferred over time | Inbound roaming | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
TDS Telecom Wireline | Transferred over time | Residential | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 90 | 83 | 260 | 245 |
TDS Telecom Wireline | Transferred over time | Commercial | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 38 | 41 | 115 | 127 |
TDS Telecom Wireline | Transferred over time | Wholesale | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 45 | 44 | 135 | 137 |
TDS Telecom Wireline | Transferred over time | Other service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
TDS Telecom Wireline | Transferred at point in time | Equipment and product sales | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 1 | 1 |
TDS Telecom Cable | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 74 | 62 | 215 | 184 |
Operating lease income | 0 | 1 | 1 | 1 |
Total operating revenues | 74 | 62 | 216 | 184 |
TDS Telecom Cable | Transferred over time | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 74 | 62 | 215 | 183 |
TDS Telecom Cable | Transferred over time | Retail service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
TDS Telecom Cable | Transferred over time | Inbound roaming | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
TDS Telecom Cable | Transferred over time | Residential | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 62 | 52 | 182 | 152 |
TDS Telecom Cable | Transferred over time | Commercial | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 11 | 10 | 33 | 32 |
TDS Telecom Cable | Transferred over time | Wholesale | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
TDS Telecom Cable | Transferred over time | Other service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
TDS Telecom Cable | Transferred at point in time | Equipment and product sales | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
Corporate, Eliminations and Other | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 44 | 53 | 137 | 157 |
Operating lease income | 6 | 5 | 20 | 18 |
Total operating revenues | 50 | 59 | 157 | 175 |
Corporate, Eliminations and Other | Transferred over time | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 18 | 19 | 51 | 54 |
Corporate, Eliminations and Other | Transferred over time | Retail service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
Corporate, Eliminations and Other | Transferred over time | Inbound roaming | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
Corporate, Eliminations and Other | Transferred over time | Residential | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
Corporate, Eliminations and Other | Transferred over time | Commercial | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
Corporate, Eliminations and Other | Transferred over time | Wholesale | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 |
Corporate, Eliminations and Other | Transferred over time | Other service | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | 18 | 19 | 51 | 54 |
Corporate, Eliminations and Other | Transferred at point in time | Equipment and product sales | ||||
Disaggregation of revenue | ||||
Revenue from contracts with customers | $ 26 | $ 34 | $ 86 | $ 103 |
Revenue Recognition - Contract
Revenue Recognition - Contract Assets and Contract Liabilities (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 13 | $ 10 |
Contract liabilities | 189 | $ 197 |
Revenue recognized | $ 159 |
Revenue Recognition - Performan
Revenue Recognition - Performance Obligations (Details) $ in Millions | Sep. 30, 2020USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 696 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-10-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 194 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected timing of remaining performance obligation, period | 3 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 230 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected timing of remaining performance obligation, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 272 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected timing of remaining performance obligation, period |
Revenue Recognition - Contrac_2
Revenue Recognition - Contract Cost Assets (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Contract Cost Assets | ||
Contract cost assets | $ 148 | $ 157 |
Sales commissions | ||
Contract Cost Assets | ||
Contract cost assets | 137 | 146 |
Installation costs | ||
Contract Cost Assets | ||
Contract cost assets | $ 11 | $ 11 |
Revenue Recognition - Narrative
Revenue Recognition - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Capitalized contract cost | ||||
Amortization of contract cost assets | $ 30 | $ 31 | $ 91 | $ 95 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Financial Instruments | ||
Cash and cash equivalents | $ 1,076 | $ 465 |
7.0% Senior Notes | ||
Financial Instruments | ||
Interest rate | 7.00% | |
6.875% Senior Notes | ||
Financial Instruments | ||
Interest rate | 6.875% | |
6.625% Senior Notes | ||
Financial Instruments | ||
Interest rate | 6.625% | |
5.875% Senior Notes | ||
Financial Instruments | ||
Interest rate | 5.875% | |
7.25% 2063 Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 7.25% | |
7.25% 2064 Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 7.25% | |
6.25% Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 6.25% | |
6.95% Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 6.95% | |
6.7% Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 6.70% | |
Book Value | ||
Financial Instruments | ||
Cash and cash equivalents | $ 1,076 | 465 |
Book Value | Retail | ||
Financial Instruments | ||
Long-term debt | 2,253 | 1,753 |
Book Value | Institutional | ||
Financial Instruments | ||
Long-term debt | 535 | 534 |
Book Value | Other | ||
Financial Instruments | ||
Long-term debt | 259 | 84 |
Fair Value | Level 1 | ||
Financial Instruments | ||
Cash and cash equivalents | 1,076 | 465 |
Fair Value | Level 2 | Retail | ||
Financial Instruments | ||
Long-term debt | 2,334 | 1,796 |
Fair Value | Level 2 | Institutional | ||
Financial Instruments | ||
Long-term debt | 709 | 594 |
Fair Value | Level 2 | Other | ||
Financial Instruments | ||
Long-term debt | $ 259 | $ 84 |
Interest rate | Institutional and Other | Minimum | ||
Financial Instruments | ||
Fair value assumption, interest rate | 1.25% | 3.55% |
Interest rate | Institutional and Other | Maximum | ||
Financial Instruments | ||
Fair value assumption, interest rate | 4.50% | 6.25% |
Equipment Installment Plans - E
Equipment Installment Plans - EIP Receivables (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment installment plan receivables, gross | $ 951 | $ 1,008 |
Allowance for credit losses | (75) | (84) |
Equipment installment plan receivables, net | 876 | 924 |
Accounts receivable — Customers and agents (Current portion) | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment installment plan receivables, net | 568 | 587 |
Other assets and deferred charges (Non-current portion) | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment installment plan receivables, net | $ 308 | $ 337 |
Equipment Installment Plans - G
Equipment Installment Plans - Gross Receivables by Credit Category (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables, gross | $ 951 | $ 1,008 |
2017 | 1 | |
2018 | 93 | |
2019 | 389 | |
2020 | 468 | |
Unbilled | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 894 | 942 |
Billed | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 40 | 45 |
Equipment installment plan receivables, past due | 17 | 21 |
Lowest Risk | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables, gross | 809 | 860 |
2017 | 1 | |
2018 | 84 | |
2019 | 337 | |
2020 | 387 | |
Lowest Risk | Unbilled | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 767 | 812 |
Lowest Risk | Billed | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 34 | 37 |
Equipment installment plan receivables, past due | 8 | 11 |
Lower Risk | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables, gross | 104 | 110 |
2017 | 0 | |
2018 | 7 | |
2019 | 39 | |
2020 | 58 | |
Lower Risk | Unbilled | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 95 | 99 |
Lower Risk | Billed | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 4 | 5 |
Equipment installment plan receivables, past due | 5 | 6 |
Slight Risk | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables, gross | 25 | 28 |
2017 | 0 | |
2018 | 2 | |
2019 | 9 | |
2020 | 14 | |
Slight Risk | Unbilled | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 22 | 23 |
Slight Risk | Billed | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 1 | 2 |
Equipment installment plan receivables, past due | 2 | 3 |
Higher Risk | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables, gross | 13 | 10 |
2017 | 0 | |
2018 | 0 | |
2019 | 4 | |
2020 | 9 | |
Higher Risk | Unbilled | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 10 | 8 |
Higher Risk | Billed | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 1 | 1 |
Equipment installment plan receivables, past due | $ 2 | $ 1 |
Equipment Installment Plans - A
Equipment Installment Plans - Allowance for Credit Losses (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Allowance for credit losses | ||
Allowance for credit losses, beginning of period | $ 84 | |
Allowance for credit losses, end of period | 75 | |
Equipment Installment Plan Receivable | ||
Allowance for credit losses | ||
Allowance for credit losses, beginning of period | 84 | $ 77 |
Bad debts expense | 34 | 60 |
Write-offs, net of recoveries | (43) | (55) |
Allowance for credit losses, end of period | $ 75 | $ 82 |
Income Taxes (Details)
Income Taxes (Details) | Jan. 01, 2018 | Dec. 31, 2017 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 |
Income Tax Disclosure [Abstract] | ||||||
Effective tax rate | 5.80% | 39.10% | 6.50% | 32.80% | ||
Statutory federal income tax rate | 21.00% | 35.00% |
Earnings Per Share - Reconcilia
Earnings Per Share - Reconciliation (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings per share | ||||
Net income attributable to TDS shareholders used in basic earnings per share | $ 78 | $ 18 | $ 212 | $ 110 |
Noncontrolling interest adjustment | (2) | (1) | (3) | (2) |
Net income attributable to TDS shareholders used in diluted earnings per share | $ 76 | $ 17 | $ 209 | $ 108 |
Weighted average number of shares used in basic earnings per share (in shares) | 114 | 115 | 114 | 114 |
Effects of dilutive securities (in shares) | 1 | 1 | 1 | 2 |
Weighted average number of shares used in diluted earnings per share (in shares) | 115 | 116 | 115 | 116 |
Basic earnings per share attributable to TDS shareholders (in dollars per share) | $ 0.68 | $ 0.15 | $ 1.85 | $ 0.96 |
Diluted earnings per share attributable to TDS shareholders (in dollars per share) | $ 0.66 | $ 0.15 | $ 1.81 | $ 0.93 |
Common Shares | ||||
Earnings per share | ||||
Weighted average number of shares used in basic earnings per share (in shares) | 107 | 108 | 107 | 107 |
Series A Common Shares | ||||
Earnings per share | ||||
Weighted average number of shares used in basic earnings per share (in shares) | 7 | 7 | 7 | 7 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities (in shares) | 4 | 3 | 4 | |
Maximum | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities (in shares) | 1 |
Intangible Assets (Details)
Intangible Assets (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Licenses | |
Balance, beginning of period | $ 2,480 |
Acquisitions | 171 |
Transferred to Assets held for sale | (18) |
Capitalized interest | 4 |
Balance, end of period | $ 2,637 |
Intangible Assets - Narrative (
Intangible Assets - Narrative (Details) - Auction 103 - UScellular $ in Millions | 9 Months Ended |
Sep. 30, 2020USD ($)license | |
Licenses | |
Licenses won | license | 237 |
Total winning bid | $ | $ 146 |
Investment in Unconsolidated _2
Investment in Unconsolidated Entities - Schedule of Investments (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |||||
Equity method investments | $ 487 | $ 487 | $ 467 | ||
Measurement alternative method investments | 21 | 21 | 21 | ||
Total investments in unconsolidated entities | 508 | $ 511 | 508 | $ 511 | $ 488 |
Schedule of Equity Method Investments [Line Items] | |||||
Revenues | 1,324 | 1,321 | 3,849 | 3,840 | |
Operating expenses | 1,237 | 1,292 | 3,611 | 3,669 | |
Operating income | 87 | 29 | 238 | 171 | |
Other income (expense), net | 0 | 0 | (1) | 0 | |
Net income | 93 | 23 | 254 | 132 | |
Equity Method Investments | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Revenues | 1,640 | 1,721 | 4,889 | 5,077 | |
Operating expenses | 1,142 | 1,247 | 3,407 | 3,660 | |
Operating income | 498 | 474 | 1,482 | 1,417 | |
Other income (expense), net | (3) | (2) | (2) | (4) | |
Net income | $ 495 | $ 472 | $ 1,480 | $ 1,413 |
Debt (Details)
Debt (Details) - USD ($) | 9 Months Ended | ||||
Sep. 30, 2020 | Jun. 01, 2021 | Oct. 23, 2020 | Apr. 02, 2020 | Mar. 19, 2020 | |
TDS Term loan facility | |||||
Debt Instrument [Line Items] | |||||
Amount borrowed | $ 50,000,000 | ||||
Receivables securitization agreement | UScellular | |||||
Debt Instrument [Line Items] | |||||
Amount borrowed | $ 125,000,000 | ||||
Assets pledged as collateral | $ 222,000,000 | ||||
6.25% Senior Notes | UScellular | |||||
Debt Instrument [Line Items] | |||||
Principal amount | $ 500,000,000 | ||||
Interest rate | 6.25% | ||||
Cash proceeds | $ 483,000,000 | ||||
Debt issuance cost | $ 17,000,000 | ||||
LIBOR rate | TDS Term loan facility | |||||
Debt Instrument [Line Items] | |||||
Contractual spread | 2.00% | ||||
Subsequent event | Receivables securitization agreement | UScellular | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity | $ 300,000,000 | ||||
Subsequent event | Installment payment agreement | TDS Term loan facility | |||||
Debt Instrument [Line Items] | |||||
Long-term debt | $ 500,000 |
Variable Interest Entities - Co
Variable Interest Entities - Consolidated Balance Sheet (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | ||
Assets | |||||
Cash and cash equivalents | $ 1,076 | $ 465 | |||
Accounts receivable | 949 | 1,005 | |||
Inventory, net | 164 | 169 | |||
Other current assets | 39 | 29 | |||
Assets held for sale | 19 | 0 | |||
Licenses | 2,637 | 2,480 | |||
Property, plant and equipment, net | 3,727 | 3,527 | |||
Operating lease right-of-use assets | 988 | 972 | |||
Other assets and deferred charges | 580 | 607 | |||
Total assets | 11,895 | [1] | 10,781 | [1] | $ 10,881 |
Liabilities | |||||
Current liabilities | 965 | 962 | |||
Long-term operating lease liabilities | 938 | 931 | |||
Other deferred liabilities and credits | 530 | 481 | |||
Consolidated Variable Interest Entities | |||||
Assets | |||||
Cash and cash equivalents | 19 | 19 | |||
Accounts receivable | 618 | 637 | |||
Inventory, net | 3 | 5 | |||
Other current assets | 18 | 7 | |||
Assets held for sale | 18 | 0 | |||
Licenses | 637 | 647 | |||
Property, plant and equipment, net | 108 | 95 | |||
Operating lease right-of-use assets | 42 | 42 | |||
Other assets and deferred charges | 317 | 347 | |||
Total assets | 1,780 | 1,799 | |||
Liabilities | |||||
Current liabilities | 26 | 30 | |||
Long-term operating lease liabilities | 38 | 39 | |||
Other deferred liabilities and credits | 20 | 13 | |||
Total liabilities | $ 84 | $ 82 | |||
[1] | The consolidated total assets as of September 30, 2020 and December 31, 2019, include assets held by consolidated variable interest entities (VIEs) of $1,070 million and $915 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of September 30, 2020 and December 31, 2019, include certain liabilities of consolidated VIEs of $19 million and $20 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 10 — Variable Interest Entities for additional information. |
Variable Interest Entities - Na
Variable Interest Entities - Narrative (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Variable Interest Entity [Line Items] | |||
Investment in unconsolidated entities, maximum exposure | $ 5 | $ 5 | |
Capital contributions, loans or advances | 113 | $ 229 | |
USCC EIP LLC | |||
Variable Interest Entity [Line Items] | |||
Capital contributions, loans or advances | $ 79 | $ 199 |
Noncontrolling Interests (Detai
Noncontrolling Interests (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Change Due to Net Income Attributable to Parent and Effects of Changes, Net [Abstract] | ||||
Net income attributable to TDS shareholders | $ 78 | $ 18 | $ 212 | $ 110 |
Transfers (to) from noncontrolling interests | ||||
Change in TDS' Capital in excess of par value from UScellular's issuance of UScellular shares | (38) | (23) | ||
Change in TDS' Capital in excess of par value from UScellular's repurchases of UScellular shares | 14 | 6 | ||
Net transfers (to) from noncontrolling interests | (24) | (17) | ||
Changes from net income attributable to TDS shareholders and transfers (to) from noncontrolling interests | $ 188 | $ 93 |
Business Segment Information (D
Business Segment Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | ||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | $ 1,324 | $ 1,321 | $ 3,849 | $ 3,840 | ||||
Selling, general and administrative | 415 | 439 | 1,227 | 1,260 | ||||
Depreciation, amortization and accretion | 217 | 237 | 685 | 697 | ||||
(Gain) loss on asset disposals, net | 6 | 6 | 15 | 5 | ||||
(Gain) loss on sale of business and other exit costs, net | 0 | 0 | 0 | (1) | ||||
(Gain) loss on license sales and exchanges, net | 0 | 2 | 0 | 0 | ||||
Operating income | 87 | 29 | 238 | 171 | ||||
Equity in earnings of unconsolidated entities | 48 | 44 | 138 | 129 | ||||
Interest and dividend income | 4 | 7 | 12 | 24 | ||||
Gain (loss) on investments | 3 | 0 | 3 | 0 | ||||
Interest expense | (43) | (42) | (119) | (128) | ||||
Other, net | 0 | 0 | (1) | 0 | ||||
Income before income taxes | 99 | 38 | 271 | 196 | ||||
Income tax expense (benefit) | 6 | 15 | 17 | 64 | ||||
Net income | 93 | 23 | 254 | 132 | ||||
Depreciation, amortization and accretion | 217 | 237 | 685 | 697 | ||||
(Gain) loss on asset disposals, net | 6 | 6 | 15 | 5 | ||||
(Gain) loss on sale of business and other exit costs, net | 0 | 0 | 0 | (1) | ||||
(Gain) loss on license sales and exchanges, net | 0 | 2 | 0 | 0 | ||||
(Gain) loss on investments | (3) | 0 | (3) | 0 | ||||
Interest expense | 43 | 42 | 119 | 128 | ||||
Income tax expense | 6 | 15 | 17 | 64 | ||||
Adjusted EBITDA | 362 | 325 | 1,087 | 1,025 | ||||
Investments in unconsolidated entities | 508 | 511 | 508 | 511 | $ 488 | |||
Total assets | 11,895 | [1] | 10,881 | 11,895 | [1] | 10,881 | $ 10,781 | [1] |
Capital expenditures | 310 | 253 | 849 | 664 | ||||
Service | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 1,046 | 1,030 | 3,088 | 3,038 | ||||
Cost of goods and services | 321 | 313 | 919 | 900 | ||||
Equipment and product sales | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 278 | 291 | 761 | 802 | ||||
Cost of goods and services | 278 | 295 | 765 | 808 | ||||
UScellular | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 1,027 | 1,031 | 2,964 | 2,970 | ||||
Selling, general and administrative | 335 | 358 | 994 | 1,027 | ||||
Depreciation, amortization and accretion | 161 | 181 | 516 | 524 | ||||
(Gain) loss on asset disposals, net | 6 | 5 | 14 | 13 | ||||
(Gain) loss on sale of business and other exit costs, net | (1) | |||||||
(Gain) loss on license sales and exchanges, net | 2 | |||||||
Operating income | 65 | 20 | 168 | 115 | ||||
Equity in earnings of unconsolidated entities | 48 | 44 | 137 | 128 | ||||
Interest and dividend income | 2 | 4 | 6 | 14 | ||||
Gain (loss) on investments | 3 | 3 | ||||||
Interest expense | (29) | (29) | (76) | (87) | ||||
Other, net | 0 | |||||||
Income before income taxes | 89 | 39 | 238 | 170 | ||||
Income tax expense (benefit) | 4 | 15 | 11 | 55 | ||||
Net income | 85 | 24 | 227 | 115 | ||||
Depreciation, amortization and accretion | 161 | 181 | 516 | 524 | ||||
(Gain) loss on asset disposals, net | 6 | 5 | 14 | 13 | ||||
(Gain) loss on sale of business and other exit costs, net | (1) | |||||||
(Gain) loss on license sales and exchanges, net | 2 | |||||||
(Gain) loss on investments | (3) | (3) | ||||||
Interest expense | 29 | 29 | 76 | 87 | ||||
Income tax expense | 4 | 15 | 11 | 55 | ||||
Adjusted EBITDA | 282 | 256 | 841 | 793 | ||||
Investments in unconsolidated entities | 467 | 471 | 467 | 471 | ||||
Total assets | 9,180 | 8,291 | 9,180 | 8,291 | ||||
Capital expenditures | 216 | 170 | 621 | 467 | ||||
UScellular | Service | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 775 | 774 | 2,290 | 2,272 | ||||
Cost of goods and services | 203 | 199 | 580 | 568 | ||||
UScellular | Equipment and product sales | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 252 | 257 | 674 | 698 | ||||
Cost of goods and services | 257 | 266 | 692 | 724 | ||||
TDS Telecom Total | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 247 | 231 | 728 | 695 | ||||
Selling, general and administrative | 69 | 67 | 200 | 193 | ||||
Depreciation, amortization and accretion | 49 | 50 | 152 | 150 | ||||
(Gain) loss on asset disposals, net | 0 | 0 | 1 | (7) | ||||
(Gain) loss on sale of business and other exit costs, net | 0 | |||||||
(Gain) loss on license sales and exchanges, net | 0 | |||||||
Operating income | 28 | 20 | 87 | 86 | ||||
Equity in earnings of unconsolidated entities | 0 | 0 | 0 | 0 | ||||
Interest and dividend income | 1 | 3 | 4 | 9 | ||||
Gain (loss) on investments | 0 | 0 | ||||||
Interest expense | 1 | 1 | 3 | 2 | ||||
Other, net | (1) | |||||||
Income before income taxes | 29 | 24 | 94 | 97 | ||||
Income tax expense (benefit) | 4 | 5 | 13 | 23 | ||||
Net income | 25 | 18 | 81 | 74 | ||||
Depreciation, amortization and accretion | 49 | 50 | 152 | 150 | ||||
(Gain) loss on asset disposals, net | 0 | 0 | 1 | (7) | ||||
(Gain) loss on sale of business and other exit costs, net | 0 | |||||||
(Gain) loss on license sales and exchanges, net | 0 | |||||||
(Gain) loss on investments | 0 | 0 | ||||||
Interest expense | (1) | (1) | (3) | (2) | ||||
Income tax expense | 4 | 5 | 13 | 23 | ||||
Adjusted EBITDA | 78 | 73 | 243 | 238 | ||||
Investments in unconsolidated entities | 4 | 4 | 4 | 4 | ||||
Total assets | 2,250 | 2,066 | 2,250 | 2,066 | ||||
Capital expenditures | 92 | 81 | 221 | 193 | ||||
TDS Telecom Total | Service | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 247 | 231 | 727 | 694 | ||||
Cost of goods and services | 100 | 94 | 287 | 274 | ||||
TDS Telecom Total | Equipment and product sales | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 0 | 0 | 1 | 1 | ||||
Cost of goods and services | 0 | 0 | 1 | 1 | ||||
TDS Telecom Wireline | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 173 | 169 | 512 | 512 | ||||
Selling, general and administrative | 51 | 52 | 148 | 148 | ||||
Depreciation, amortization and accretion | 30 | 33 | 94 | 99 | ||||
(Gain) loss on asset disposals, net | 0 | 0 | 0 | (8) | ||||
(Gain) loss on sale of business and other exit costs, net | 0 | |||||||
(Gain) loss on license sales and exchanges, net | 0 | |||||||
Operating income | 23 | 16 | 73 | 78 | ||||
Equity in earnings of unconsolidated entities | 0 | 0 | 0 | 0 | ||||
Interest and dividend income | 1 | 3 | 4 | 8 | ||||
Gain (loss) on investments | 0 | 0 | ||||||
Interest expense | 1 | 1 | 3 | 2 | ||||
Other, net | (1) | |||||||
Income before income taxes | 24 | 20 | 79 | 88 | ||||
Depreciation, amortization and accretion | 30 | 33 | 94 | 99 | ||||
(Gain) loss on asset disposals, net | 0 | 0 | 0 | (8) | ||||
(Gain) loss on sale of business and other exit costs, net | 0 | |||||||
(Gain) loss on license sales and exchanges, net | 0 | |||||||
(Gain) loss on investments | 0 | 0 | ||||||
Interest expense | (1) | (1) | (3) | (2) | ||||
Adjusted EBITDA | 53 | 52 | 169 | 177 | ||||
Investments in unconsolidated entities | 4 | 4 | 4 | 4 | ||||
Total assets | 1,539 | 1,430 | 1,539 | 1,430 | ||||
Capital expenditures | 74 | 61 | 171 | 145 | ||||
TDS Telecom Wireline | Service | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 173 | 169 | 511 | 512 | ||||
Cost of goods and services | 69 | 68 | 197 | 195 | ||||
TDS Telecom Wireline | Equipment and product sales | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 0 | 0 | 1 | 1 | ||||
Cost of goods and services | 0 | 0 | 1 | 1 | ||||
TDS Telecom Cable | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 74 | 62 | 216 | 184 | ||||
Selling, general and administrative | 18 | 15 | 52 | 44 | ||||
Depreciation, amortization and accretion | 20 | 17 | 59 | 51 | ||||
(Gain) loss on asset disposals, net | 0 | 0 | 1 | 1 | ||||
(Gain) loss on sale of business and other exit costs, net | 0 | |||||||
(Gain) loss on license sales and exchanges, net | 0 | |||||||
Operating income | 5 | 3 | 14 | 8 | ||||
Equity in earnings of unconsolidated entities | 0 | 0 | 0 | 0 | ||||
Interest and dividend income | 0 | 0 | 1 | 1 | ||||
Gain (loss) on investments | 0 | 0 | ||||||
Interest expense | 0 | 0 | 0 | 0 | ||||
Other, net | 0 | |||||||
Income before income taxes | 5 | 4 | 15 | 9 | ||||
Depreciation, amortization and accretion | 20 | 17 | 59 | 51 | ||||
(Gain) loss on asset disposals, net | 0 | 0 | 1 | 1 | ||||
(Gain) loss on sale of business and other exit costs, net | 0 | |||||||
(Gain) loss on license sales and exchanges, net | 0 | |||||||
(Gain) loss on investments | 0 | 0 | ||||||
Interest expense | 0 | 0 | 0 | 0 | ||||
Adjusted EBITDA | 25 | 21 | 74 | 61 | ||||
Investments in unconsolidated entities | 0 | 0 | 0 | 0 | ||||
Total assets | 721 | 644 | 721 | 644 | ||||
Capital expenditures | 18 | 20 | 49 | 48 | ||||
TDS Telecom Cable | Service | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 74 | 62 | 216 | 183 | ||||
Cost of goods and services | 31 | 27 | 91 | 79 | ||||
TDS Telecom Cable | Equipment and product sales | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 0 | 0 | 0 | 0 | ||||
Cost of goods and services | 0 | 0 | 0 | 0 | ||||
Corporate, Eliminations and Other | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 50 | 59 | 157 | 175 | ||||
Selling, general and administrative | 11 | 14 | 33 | 40 | ||||
Depreciation, amortization and accretion | 7 | 6 | 17 | 23 | ||||
(Gain) loss on asset disposals, net | 0 | 1 | 0 | (1) | ||||
(Gain) loss on sale of business and other exit costs, net | 0 | |||||||
(Gain) loss on license sales and exchanges, net | 0 | |||||||
Operating income | (6) | (11) | (17) | (30) | ||||
Equity in earnings of unconsolidated entities | 0 | 0 | 1 | 1 | ||||
Interest and dividend income | 1 | 0 | 2 | 1 | ||||
Gain (loss) on investments | 0 | 0 | ||||||
Interest expense | (15) | (14) | (46) | (43) | ||||
Other, net | 0 | |||||||
Income before income taxes | (19) | (25) | (61) | (71) | ||||
Income tax expense (benefit) | (2) | (5) | (7) | (14) | ||||
Net income | (17) | (19) | (54) | (57) | ||||
Depreciation, amortization and accretion | 7 | 6 | 17 | 23 | ||||
(Gain) loss on asset disposals, net | 0 | 1 | 0 | (1) | ||||
(Gain) loss on sale of business and other exit costs, net | 0 | |||||||
(Gain) loss on license sales and exchanges, net | 0 | |||||||
(Gain) loss on investments | 0 | 0 | ||||||
Interest expense | 15 | 14 | 46 | 43 | ||||
Income tax expense | (2) | (5) | (7) | (14) | ||||
Adjusted EBITDA | 2 | (4) | 3 | (6) | ||||
Investments in unconsolidated entities | 37 | 36 | 37 | 36 | ||||
Total assets | 465 | 524 | 465 | 524 | ||||
Capital expenditures | 2 | 2 | 7 | 4 | ||||
Corporate, Eliminations and Other | Service | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 24 | 25 | 71 | 72 | ||||
Cost of goods and services | 18 | 20 | 52 | 58 | ||||
Corporate, Eliminations and Other | Equipment and product sales | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total operating revenues | 26 | 34 | 86 | 103 | ||||
Cost of goods and services | $ 21 | $ 29 | $ 72 | $ 83 | ||||
[1] | The consolidated total assets as of September 30, 2020 and December 31, 2019, include assets held by consolidated variable interest entities (VIEs) of $1,070 million and $915 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of September 30, 2020 and December 31, 2019, include certain liabilities of consolidated VIEs of $19 million and $20 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 10 — Variable Interest Entities for additional information. |