TDS - Earnings call transcript Q1 2022 | Telephone and Data Systems, Inc.

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Operator

Good morning. My name is David, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the TDS and U.S. Cellular First Quarter Earnings Results Conference Call. Today's conference is being recorded. Instructions]. [Operator President you Vice conference. begin Corporate of Thompson, may Relations, your Colleen

Colleen Thompson

webcast This appearing due the but highlight this morning. the to our filed SEC's the issues our documents U.S. simultaneously Officer. XX-Q incoming have websites our Chief are Cellular's adjusted EDGAR, contributions on majority morning, on joining can TDS Villacrez, Relations operating and the We Vice and aware and offering referred to you Cellular, Vice we Chief including for are EBITDA, thank Finance find yesterday, slides the and Doug wireless and TDS of websites with Financial me or this Chief Telecom, are today is interest, Chief and from Investor Officer U.S. before provide Sereda, Officer; President depreciation Chambers, TDS, of market to We Treasurer; Financial Pete presentation Vice Please Good Relations to you taxes, Financial call, TDS website. and make on depreciation after us. with TDS U.S. of of Vicki both the or non-GAAP amortization, and Cellular call and see section and Financial which Michelle income adjusted Executive partnerships. this yet President amortization, for for comments LT Officer; morning, want not earnings close from on Therivel, Executive Executive Investor Executive We All OIBDA, reconciliations. from Senior the to the U.S. Cellular the Brukwicki, comments being President prepared and but on they you guidance With accompany of Chief and President the prepared President, and all before websites. website. SEC Officer; Vice

this in discussed and to and harbor call version future expected in risks extended set that SEC presentation events Slide uncertainties. contains shown filings. results the the releases and subject information during about review on X, and the press financial the safe and our Please forth As statements forward-looking our in paragraphs are

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Peter Sereda

the is her creation she and for general company. XX of deserves last credit experience morning. Vicki Good and hands month, of years this was the together the months of enterprise, XX smooth TDS to has the that much and the of years will a success over as CFO. confident In CFO as has the a underway TDS business execution well key good working that I'm ensure financial when I in Telecom, transition. X Vicki end the leader driver, TDS transformation Villacrez fiber I with with she of at spent and be of she the as retire closely and as

will And as Vicki? call that, CFO to of with of lucky We Vicki. her outstanding I someone turn very a She's with are will ability. do an very have talented over and TDS. the level leader to job

Vicki Villacrez

and everyone. morning, Pete, you, good Thank

a strong and the be into am with exceptional such I role, talent. CFO a As financial this to foundation fortunate I company step at

opportunities will of their each advantage ensure our their forward, businesses can Going growth improve competitive maintain we take positions that of that we so position enhance returns. to to this long-term ultimately continue and

We have past shareholders, XX through to increased return cash primarily for expect dividends, the which year to value every years. to also continue

amount In and this opportunistically continue chain time, in fiber mitigate addition, we quarter are are overall, again, program. we its market impacts, repurchased make organization watching areas so X any a are and we developed businesses. expectations Telecom a on financial a of Investment is program at level, we'll meeting managing player expansion closely. guided the Infrastructure may the We've and of do is our in executing depending businesses on to modest focused to to and supply stock on and I beginning Act, at Both is continuing modest success their are same its strategic U.S. good network, the of and high-performing to TDS we believe to Inflation seeing the strategies or At that improvements Jobs Cellular in key ensure year. be IIJA, both priorities and that conditions. working the well. at the

A-CAM also on participate of we unit specific advocate We their the Each the in which areas of over call to LT. focus these I'll on today. the And extension this business program, strongly morning. turn FCC's topics currently now touch will

Laurent Therivel

Good Vicki. morning, everybody. Thanks,

you mission. to people keep mission that the them. our connected that matter just can our support on see in priorities of you customers on most see As and the remains the that can strategic slide, And some Slide consistent: X, places

Q&A And me to turn in over you X. can outcomes try been developed marketplace, On start also operating over be perspective, may aggressive see around and performance financial some this competitive. Let tested the our acquisition from months adjusted with with the disciplined continually outcomes. And return growth income we've get slide, satisfied drive in when the the strong extremely be from revenue for our past X first X strategies tried really, not an section, past over -- the the to there I'm we've the standpoint, with sure although in subscriber years, a financial questions environment optimize price and capital to I'm that move. quarter. AT&T's see Slide has We you quarter. and the that recent on increase me to time, offers we results particularly regionally subscriber we've let postpaid. to

caring be focused experiencing committing we we all times, effects we'll to this not the in do supply an X our to existing of and although plan insight We're certainly Although we highly is as of the customers labor raise have I increasing commitment that committed conditions, industry churn. somewhat And our this. the operate our economic challenging for industry costs decision, we're into industry. inflationary across the drivers through opportunity. don't during view fares chain. said, improving being on to This plans costs component, XXXX. in generally will insulated a their X highly from capital-intensive That on economic our is our all customers increasing well least prices just component We're end at tough and of rate and

to back of theme the come balance. me Let

We did. drive results, positive have to better results certainly subscriber challenging ARPU and we

XXXX. As our includes on last the a of despite ARPU device year-over-year, strong that this by negative and the ARPU credits X the metric ARPU. a by grow this you moment, ability Doug seen encouraged and in of revenues. over postpaid of on highly you've service monthly over years, X% headwind postpaid X% was environment, ARPU had up our to our And associated will first Very impact each this can We've see impact discounts, is growth and providing growth and a promotional time. in touch grown the with quarter on postpaid

tremendous, look prepaid. results switch pleased I'm Let's that quite Though performance a to of the line don't the from but relative basis. top with business actually prepaid

pool were results first across industry. prepaid a in quarter entire lower the Our impacted the by switching

of that well. switching perform to Our adds gross in share continues pool quite

We high-speed had up continue those investment to product, the expand dozens wave momentum year-over-year, We cities. while cities most of in our Internet adds year. of Gross business. access quarter our to positive to another wireless XX% we We of service the fixed more plan see offer results. of on do have this low-band strong growth areas throughout continue wave XG now millimeter XG our in service available footprint. in XX We millimeter

And there We're see messaging. a signed provide recently, really positive beginning to positive IoT investments and well. first build. growth. We positive we deal BXB see our to deal also targeting, growth in in continue to results the produced momentum space. seeing Our to The momentum our tower networking from as double-digit cycle continued private business space in management, revenue capabilities continues we're the digital better digital, life

the quarter. helps increase mobile deepens sessions For App mobile costs the Scores. improves higher measured in our customer example, a at our term. app year-over-year app experience It This long XX% resulted over has also transactions, this seen we've us app traffic of by as engagement. improves end significantly the in substantially customer and manage experience, This and the

the to network. Turning

modernization XG network in is our continue program XG multiyear traffic customers' And majority of we're devices carried hands. sites our equally deployed. have that We important, XG by our deployment. and getting The

our devices. XG-capable the subscribers of XX% far, have mentioned So Vicki IIJA.

meet with that stakeholders maximize We under opportunity wireless for key continue to that our program.

this. Let's put around context some

billion put and states. solution In operate funding fixed believe terms to as but $X being our worked And know compelling allocate a IIJA billion we the nearly $XX network. of broadband uneconomical much are specific of out, to individual as to still where the will the the explored fiber. dollars, we where home We it's that business is areas wireless broadband allocations for

our speeds America. of tremendous marketed for at our X capacity gig product That's nearly XXX in over technical megs. X kilometers speeds a is You've rural improvement and in And seen trials.

of drive we And help benefit wireless infrastructure investments improving network the make the of levels broadband us provides to coverage. any revenue. also investments greater towers our mobile Additionally, in wireless clearly, tower additional

I'm financial outcomes in summarize, to the first So quarter. with pleased the

to of growth continue momentum investment see in areas the We positive business.

outcomes. continue strike results to challenged, we outcomes to and in right postpaid, Although try subscriber financial subscriber were between balance particularly the

you So the to Doug, take call I'll who's turn over going through to financial the results. Doug? now

Douglas Chambers

Good LT. Thanks, morning.

Postpaid a an by Overall, saw increase by increase additions additions XX,XXX were We by unlimited a by the of results constraints. to additions start on growth in net with the our churn, an solid additions, review driven partially lower and in wireless see X,XXX, by decreased in gross offset additions was network. competitive connected to Postpaid decline in wireless environment. of discuss continued tablet moment. Let's XX,XXX, largely now part fixed due are global a handset to I in we handset in plans gross Slide gross in supply will driven additions. available down X. customer due continue which fixed This majority lower aggression as device

aggressive continued rate higher prior year, result on in competition. as the churn churn from attributable to consumer increased shown very turn switching activity by as postpaid low Next, and devices, associated Slide rates a let's of over business driven combining increased for the postpaid churn payment churn, involuntary experienced changes the Total industry-wide disconnecting churn handset to Postpaid XX. voluntary Involuntary increased, various we behavior and and that impacts also due the to in in reasons the XXXX devices higher past activated increased X the churn handset certain connected customers to due churn years. government handsets pandemic. were connected pandemic various of with

Prepaid higher last the driven declined additions also prepaid churn, lower XX. gross by effects add the lower and XX,XXX, by additions a Slide gross pandemic. to Moving Net due XXXX. lower was driven of pool largely X,XXX, by to decreased which in year additions gross

X% for Inbound primarily financial will volume in the higher per user, starting XX. and turn service revenues to the to rates. roaming operating revenue to prior lower XX% a declined due by data from let's moment. lower year. X% improved discuss a the Now declined due on results, first Retail average revenue I quarter Slide revenues which Total

merger service to Other and T-Mobile's due of factors T-Mobile revenues. this revenues up higher to of the the continued and is migration roaming revenues miscellaneous/other volume One X% were Sprint and the of to decrease both traffic Sprint contributing service data rental tower network.

the offers equipment revenues in which sold per as value by the to in of average a of an driven result decrease well unit, environment. Finally, sales decreased competitive as revenue as units promotional a due was by decrease in XX% a increase

and costs. we promotional our XX. revenues. customers tiers product on ARPU handset increase continuing were user X%. number an up per in plans. customers were to provide The plans, of Slide in device highest of are on further and X our to focused improve XX% increase to plan this mix surcharges per Turning by and Average and and average an in grow with unlimited increase increases Currently, revenue protection were the cost of value revenue driven these are enhanced These partially our to operating account favorable and offset recovery by

XX, the year, in increase steady by rate. continue to tenancy rental you our see driven from in Slide which growth we XX% As increased an revenues, tower on tower can see by prior

on the Our financial for results overall quarter Slide are shown XX.

I operating income. this adjusted to operating income discussion, amortization adjusted losses before depreciation and For as and gains accretion refer will and and

I decrease earlier, driven essentially total general As administrative increase expenses in while cash flat. an increased revenues Selling, was experienced commented expense from due a write-offs X% to by levels. debt expenses actions historical total and decreased involuntary of which increased flat. equipment essentially declined related operating by Cost X%, sold. X%, driven in in throughout sold units operations pandemic were expense an increase the Total to have levels pre-pandemic very system bad low to

expense, impact continues levels, debt which expenses results. XX%, essentially declined a strong to income, which Capital to adjusted were increased result the program, by highly decreased reflects expense have timing Excluding which driven EBITDA, flat relative environment year-over-year in investments, year. and mainly discipline Adjusted earnings bad cash of other the yield of operating from returning our the equity interest the of incorporates expenditures loss and equipment, X%. our execution and and multiyear operating with of pre-pandemic dividend is our optimization X%, along the and is expenditures prior cost promotional to on the XXXX income which

I XX, XXXX. the our Slide full to cover Turning year for guidance will

single-digit EBITDA growth income range revenue, reflects remain retail the guidance competitive high-margin highly roaming total of in expectation estimates decline continued low adjusted service in environment. our service Our for for adjusted revenue a and promotionally-focused This operating continued unchanged. revenues, and and

in on Brukwicki. call will Michelle modernization and the and turn preparation For also Michelle? investments capital to our I XG expenditures, maintaining remain we track. range deployments our are initial network our mid-band guidance for as over now spectrum

Michelle Brukwicki

Thanks, Doug, everyone. and good morning,

quarter. at results Telecom for our with TDS the pleased are We first

We are our in fiber tracking to financial strong growth expectations program. guidance our and had

XX,XXX our expansion February, added into our marketable Since on planned, new continue As in and and addresses execute to we Wisconsin. Montana several in footprint announced strategy. communities to fiber our fiber X service we markets

We strategic completed and date. We have our results our construction pleased to Wisconsin remain in with same for are years. to we also central focused cluster pillars several committed fiber on the

broadband. in is flagship Our objective returns our growth by primary strategic product, provide to investing and improve high-speed

anticipate higher more for extension support our speeds. Extending IIJA would A-CAM areas. are help in existing enhance program, divide directing of broadband considered, even meeting -- and years offerings, to of footprint expand broadband provide and our the in A-CAM FCC's product At bridge to revenue funding, additional provide TDS are most growth. fiber We program and We driving fully investments new aggressively be our federal will to in deploying markets which in investments revenue advocated with the along our current higher would these and for extension speed upcoming support. opportunities Telecom May, digital we program rural an exchange for the an the the

the We made quarter. for achievements Turning to this we've XX. Slide highlight

announced and X Helena. new Great Falls, in Missoula As fiber we Montana, mentioned, markets Butte,

the We will western deployed and such expanded are also Wisconsin: we markets We by now fiber in areas markets new footprint in metric, additional year. fiber, slowly steadily development. as are as service now cable in first XX,XXX cadence I the in is cluster our of our throughout are X Janesville announced Brookfield, Wisconsin XXX,XXX in fiber quarter served now by of our of cable greenfield measuring quarter the communities. markets. fiber reach we we includes as in quarterly opportunistic the fiber and our and addresses addresses fiber mentioned, working year. building XX% and Beginning marketable service total in this starting to service deploying X XXXX, address the hard delivery, our for target and Seasonality impact

by as we XXXX. XX% As to with of fiber total February, serve in a reminder, reported expect footprint approximately our

our the performance deliver for we of manage headwinds, continue to we rest including service supply As the inflation, contractor to industry-wide chain variety address look challenges. a goals and year, of

to headwinds grew and our year-over-year. pipeline In objectives, working line pleased We mitigate X% first are and In to a these have if growth to with our us network the X.X of addresses robust markets of are necessary. to pivot help completed our to total in continuum X-gig availability we quarter, the XX% from ago. our DOCSIS market upgrade of addresses, up year speeds increased a service service XX%

have XX% state. growth trends positive see fortify across a the for We as we still into consumer X% expand can XX% broadband broadband fully you we markets. connections rates penetration continue and residential penetration been the markets our launched more quarter XX, fiber all in our for grew to steady anticipate to also connection in with in Slide that than months, see to XX broadband continue new On Total markets. and networks

track growth program, A-CAM or XX% on graph per up to with taking to are in We megabits customers greater, greater demand under on right, second the speeds, continue see the in the on ago. incumbent we market. our our network Shown our XX% for also from year construction helping a of XXX broadband drive

us we tools XX% we product markets, X-gig customers offer areas our Our ago. will along superior a defend customers. to with taking allow this our new product, certain are compared win X-gig service, and XX% year are seeing where X-gig important product new In in that with of

revenues in across broadband generated revenue. which focus Our residential On X% increase X% driven revenues, reliable operating XX, largely has Slide increased service increased year-over-year, markets. growth total a residential all XX% fast on in total by

revenue an address service broadband delivery. Overall decreased connections, a to in a in and following connections. chart flat grew connections. market Residential timing to changes have revenue by in increase the expansion connections, drove CLEC connection. wireline revenues the video increase revenues in on primarily offset mix shown left, voice quarter, wholesale due in the X% residential market decline per incumbent X% due year-over-year Commercial broadband of the was X% Cable As X%. revenues growth year-over-year, and by in increased driven product revenues decreased residential average lower

Let me for sum up shown combined results Slide on the financial as quarter XX. the

fiber we current from Cash to mentioned, in from with growth platform support prior year we business. year-over-year, savings future legacy our the expansions as by growth increased flat X% exceeded increases our in As declines were our and costs. broadband revenue experienced expenses and in subscribers just increases the offset

Capital increased continue from our as XX% As increase year EBITDA growth. a X%. fiber improved in expenditures adjusted on and last investment broadband result, we to focus deployment

Moving to XX. Slide

We guidance, which have we presented from is February. shared unchanged what in

to in progress on as I fiber growth our their EBITDA for to reflected continue the to which, our want team all new pressure a members markets year our put deployments thank will as on reminder, continued our adjusted in We during agenda. ambitious dedication guidance.

the to We and had you successful second start have year forward quarter. look updating a on to the

back the will to Now I turn call Colleen. over

Colleen Thompson

David, for Okay. we ready questions. are now

Operator

Instructions]. with Stanley. [Operator our Morgan Flannery take Simon first from We'll question

Simon Flannery

back others you is the The on So are are slowdown in wireless in about? are softening a then seeing coming Is more in competition. was that the you involuntary, this the had on this getting sensing noted the that And to traffic. talking bit, the talked What as marketplace? more rural on environment. a What just LT, aggressive? quite you that normal? last churn seeing the just Or this build? low year consumer some Is Is and up behavior about competitive some Verizon very this was T-Mobile's cable store macro? you are

Laurent Therivel

switcher side of is refunds tax because things expect the pressure actually still bit put seen almost question We've the gross lot I'll is other X% toward subscriber triangulated of spending devices. answer is You that in strong. relatively results. the kind our than are of around. from people quickly down I a year-over-year. footprint pool of their the on mobile to context The equation add churn tiny a the

that, gross share 'XX account 'XX. Overall last so is up new X% I gross down year. adjust and actually for our adds when adds And of from are from

that, the focus drive performance to is side good quite add on clearly so it got of churn, is nationally. what environment we you need add good. in correctly we're some on to continue I different actually as particularly to then the not we've When and see address that gross at seeing identified. and and plans competitive need about, while equation, challenge lines what it's look there, you footprint place from And the The in asked to on you the

but than grow XX% incrementally from national in of actually not, bit footprint. present, more we're You nationally. insulated footprint trends. than except way, see T-Mobile Same a continue cable you little Cable any our with our really what to about is cable, see overall in

given in so although to rural more them we And we're we of our see little continue nature present the do footprint. a our think marketplace, insulated, bit

what are been It's Verizon we environment. upgrade has from aggressive really So AT&T. Particularly else very matched a seeing? that.

announcement to right putting raising our any it's not prepaid, at have end focus One really continue to with X And about prices to things. thing And or we're on so think notice the the out customers, focus other we talked you'll we until be customers. I on the to is got we've to and And XXXX. of the least is our X about lines of on do. add churn postpaid there going

a we That position levels customers conditions, given to it enter if or the the exit think to, And do can telecom right, always late new high for telecom. There are we on you raise said, we we inflation, of need rate really want so plans, if qualify device in do think I being to prices, we economic see certainty. promotions. I customers, flexibility is for if have of early require new the and looking relatively we overall and insulated. recession, we're

adjust, will thing And bringing for have right we we churn. be it's but need So attractive to still to, think very it flexibility think customers. we down if we the for

later of in rolling couple a the have also the churn plans problem. be quarter address We that out to other we're to going

we continue Doug, you adds. to in to questions. churn the answer me while optimistic turn I'm let improve to address our to invol So it gross ability

Douglas Chambers

on the side The Sure, Yes. reason invol is what you cited. Simon.

During we a watermark for are of the debt and in the paying high. government stimulus. savings heart entire Consumer in itself Consumers low their of expenses, rates manifests year. bills the There really were that $XX XXXX, experienced million bad somewhat pandemic favorable was for What first in bad really our the nothing that returned debt pre-pandemic We're speak We did expense unusual. in during sort this seen quarter we've just bad pandemic. of same is that experiencing to plan the benefit levels. guidance, for we expense. dept not to

Simon Flannery

Okay, great. And consumer down store the after year? strong traffic the any sense or a of down slowing slowing industry

Douglas Chambers

year-over-year mean, I store No. slightly nothing traffic our down is but concerning.

Operator

to Next, Dluzhevskiy GAMCO we'll with Sergey go Investors.

Sergey Dluzhevskiy

My is on first LT. of question kind go-to-market strategy, your

markets. So differentiated different you're things regional approach different trying obviously, and in a you have

more opportunity You are far. implemented could you have have you effective add make since do to that what approach if share maximize you so What worked has do potential be front? various this clusters this you how on the And been approach, could going that. gain Maybe can improved? so that results forward? gross noncontiguous, reflect, What and

Laurent Therivel

and those XX executed as XX mix test over then in the over the approach beds easy trials with, and pivot regions and pleased create only regional it putting creating context. me I'm regions put not is very and the to to the Sergey, months, pricing processes discrete It and place in regions. let our that. structures but -- you've marketing we've across not talked executing And use to to, on promotional last

plan doing later relatively going specific trial. going can't -- the out. move I the to of we're on quarter, regional to we're but hate One give like details this this doing that But calls was I be the on by substantial educated in a be the rolling

performance. so example seen from we've that individual some do Another increase regional able been or of learned competitors. trials. we've because our contrast the give to attractive of ARPU ARPU is we've with seen, I'll very lessons And that I'd

approaches, done to trial it go-to-market specific had to you we've regions. individual sales. We've that our with upsell able We've because we're mentioned, done and haven't ARPU we've strong growth as done the to it execution, get plan with different different We that in seen. require

to approach And talked pleased you seen national at just right test, individual distribution very plans will the programs prepaid rate we to so with sure At make and guarantee. I vary the approach. about device see like it's We to region the so expect whether fairly promotions. continue. substantively We far time, around significantly. what we've same our we vary times, it But out fairly the roll X region rate we plan continue to can strike our

we're and helped So really and optimize learn, to trying test continue us it's will us to optimize. help and

pleased So with proceeding. it's I'm very how

Sergey Dluzhevskiy

My on your wireless strategy. Great. is question next fixed

your fixed that expect Maybe to you fixed out What in you're millimeter a wireless quickly wireless about high fixed XX out markets your little you're throughout you you markets you of said wireless offering? going XXXX? what and in scale year. prioritizing build? in wireless your be footprint? At in in this And You're how to the and a with wireless could kind wave to of speeds do do expect to markets bit market more approach dozens talk kind level, fixed comfortably

Laurent Therivel

year-over-year, learn like So and start because we've adds that that that experience, down lessons year-over-year the of product. using XX% north with like build-out. that well or we adds we our our that's from wireless. operational DSL buildout. now customers -- can then sticking X.XX, most a to adds, low-band lot they're support fixed wave And of done XX,XXX very performs gross spectrum our customers we with of low-band can the also we're areas, low-band also as best And planning driven the online, bring your in We're the increases see increase it. gross actually we've is what product. with gone is mid-band spectrum substantive low-band first, apply to, on they That And net satellite. -- in that millimeter and competition But in product, to product we also primarily let me plan C-band rural we on where

XXX mentioned are wave cities. that X conservative We megabits. speeds rolled to out we rolled XX our provide. relatively of I we've it of mentioned product out now technical We're experience kilometers. trials the X actual can we we gig over terms millimeter that's in so And believe marketing almost

day, course, no Of wind. no that's rain, sunny

to product continue more very conservative But roll a we be in a we're as actually there out we try mid-band. So the And in to offer that at megs. product bit we'll market. put what high-quality we offering XXX out

sort wave can of in our so millimeter And you about X go-to-market for mid-band strategy think categories. and

Right $XXX,XXX take with money make product it but -- of and of a call us, in a are plenty I is $XXX,XXX $XXX,XXX in is the wave are the category to radius first basis. estimate now, way, places put costs $XXX,XXX make U.S. explain a it the need can mean in on the what stand-alone to $XXX,XXX to areas tower America, that density The cost footprint on our IIJA, I'll where put can in let's we we in can to homes a by that $XXX,XXX. hundred at will there range, that we you envelope, can the to millimeter couple attractive businesses alone. have a from But really network C-band We put on customers economically think between of it where The we the to in of it as serve that it order by provide we who $XXX,XXX opportunity, back tower, we really. or able becomes interesting around be and and good X.XX product I available. tower fixed that. If IIJA. a And wireless X-kilometer mentioned area, wide a a rural free. cost of or

areas Those densities. When unserved to in unserved profitably which reason. what want at can for and customer you the lower It's Now underserved areas wireless. product to costly states look a areas for on do. there's all areas. support areas, we great for focused it's us of roll underserved very and a They fixed density and IIJA, are aren't are that sudden, much is very low great fiber. Those out

that towers that the combination about fifth to governors I've investment, helps the mobile in and assuming that mobile homes thing market that those And to experience fulfill businesses, is to helps level. very dollars subsidized also that a that so location because company but we're those ability optimistic us improves is area part the carriers and what's those wireless and we can in country, fund also our with of state-by-state the to help in And revenue. to other on spoken the beautiful will And about commissions by fixed that very then when dollars XG in compelling the the and business. participate we're those tower IIJA and it, are the plans our make dramatically this we broadband towers states, it largest to

possible. X-part a much as some So there's it we're That's those benefit if really we're time on why able as spending get of to funds.

So Sergey. I'm that about business, optimistic very

Sergey Dluzhevskiy

Great. cost and And my the guidance savings for on last question opportunities. is Doug

are out the implies XXXX are midpoint the to time? think of costs of to of of things to horizon, pursuing mitigate I over meaningful I what guess cost-efficiency some What of you actual X-year a And And doing larger that could now question cost-cutting those are of some take over those of EBITDA X- longer be you maybe maybe -- So about points, a a they your guidance XXX buckets the are how that of some less, business the what little efficiency results. the margin to is, right compared basis my pressure opportunities? are some pressures? and initiatives

Douglas Chambers

Yes.

XXXX, executing increased of We efficiently recently agreements internal margins labor year and across even part. everything the mix a the to to in as results changed from with between provider, Really, revenues, the XXXX. excess our highly well. really When we're sell-side the sixth opportunities. can you have XXXX as it. maintenance of And We're on program the look focused in that finding now business. side, and things at XXs, rent XX% in We've contracts and IT of in a and cost engineering the and insurance more doing of the on in on optimization across backhaul you we It's focused our see and they steadily going business. It's revenue percentage that on. were it's service been they our right cost

of the we're XXXX, with mitigating as to revenue, progress on doing was but it. earlier, expense we're of pressure little we're and I partially step our in we're year zero-based the costs, in because about a on little are bit of Last well. dollars expense had invest which losing talked high-margin the roaming all increase and part again, things expense using stopping a process way, And the still the XXXX, debt happening sixth backward roaming the of continuing all similar promo, we not going very margin as cost. the because are in promo we we started that first Now in year those making quickly. savings background, this bad that the budgeting In because

the a success. So business. said, across I on. And great we're like the pressure it's keeping been it's And really

Operator

go to we'll with Citigroup. Next, Rollins Michael

Michael Rollins

with or where in be for please. to opportunities business curious front or other and in the you're expand great, TAM? bridge focus strategically the Just would thinking terms on category U.S. Cellular partnerships updates about scale that carriers of alliances Any either

Laurent Therivel

no changed, position is X, front. have it and on belief fixed the makes conversation on belief around , sense Mike, business rural multiple had that that X, heading back is, networks where this whatsoever hasn't harken to wireless I'll and just for is open X My that my duplicative IIJA, to area the we towards. in XG that, which I'm we're

America. bring I there's investments make makes the sense. together don't to And involved, work a that the worthwhile lot high-quality intensity to experience a in I capital think rural deliver of the capital that's of to down Given to intensity plenty opportunities more and think

that. had conversations. open remain multiple I So very We've for

These multiple move have to conversations. continue do things We quickly. not

think But to the don't around intensity is I so is I And that's anything shared imminent. the that, viewpoint across want that required. industry capital [indiscernible]

probably behind AT&T's think some is move. that of I most pricing recent

So I and think folks the industry. been with that with we've other in opportunity, there's clear quite

Michael Rollins

think builds and let's create work a Just can performance the gating case built cost to large lot if it the you that spectrum for factor does a you'd deeper of for would better? make versus Or performance users? When you've access more with do Cellular, is that you relative a another that not cost to carrier maybe that level you over drive the rural of cheaper spectrum XG, spectrum position because and moment. U.S. you on time, to, for where have performance those going say, a the double

Laurent Therivel

into ability concern OpEx. So at intensity, up, it all IIJA an so bullish to that's a Possible lower rural deliver share future. the and even put same dollars do do same cost Dish, why and and is lower Verizon, dollars. OpEx factor. at largest the it capital us climb Spectrum me us ability I AT&T, doesn't to that in the level for climbing sense make think the remains of not to cost. lower have to service the Coverage spending about to Mike, towers putting place, coverage potentially an T-Mobile, that of America equipment even in this you the a more now tower, It I'm now, and capital to give same tower, same and the Right the and gating divide at deliver partnerships

cases creative ways level long aggregate whether to network. those In let's fast speed this substantive there's problem. use to finding deeper, a will or different a requirements In [indiscernible] an the vehicles, ways whole tackle for our on drones, autonomous the place AR/VR of Now a little world, run, load those it's spectrum, forward. variety

forward also rural a to in X the years, differentiated spectrum in service. able fast America I think will provide years, a to fast then be cost-effective aggregate opportunity forward we XX way

cost near-term efficiencies, long-term opportunity. So experience

Operator

And there to turn are now no call I'll over this at time. okay. back -- further questions the

I a question additional apologize. Rick apologize. Prentiss from Raymond Thompson or I with any remarks. turn it over a closing have I'll have back question We -- Colleen from for James. to Actually, we

Richard Prentiss

for in to partnerships. wanted apologize earnings question ask late. Busy day being the again. on I I

about You weak. guys opportunities? partner as at were far on network and what DISH came you're quarter have network on What Network sharing talked sharing. are might asking how today with looking you partnerships in consider update obviously, working previously call thinking any they'd partnerships up the as the adds about sharing But you DISH with?

Laurent Therivel

time, in if Ric, I just just answer, of to could We literally just I we -- you maybe back the interest transcript. -- opportunity. there's direct clear. that certainly made the kind I we question, that Short think of answered so can

costs the we the continue side to but to a those discussions. via that think both bring the I and CapEx in conversations have and down, imminent on there's long-term had. some We opportunity Nothing indicated OpEx of partnerships, that's

Richard Prentiss

Okay. question. I'll go to another

up? that Sorry come about that. access, Fixed has wireless

Laurent Therivel

It did.

Richard Prentiss

said reported? were about I you where it adds in something is up, it press in are And gross Are is talk as far release included gross they you you reporting think did adds the reporting, but the numbers as yet? them? you're anywhere that

Douglas Chambers

included this low-band And and Ric, in we're No. forth of customers at count separately adds time, currently, are access wireless. customers. it postpaid of and XG not fixed all wireless fixed is. our where our reporting so It's that's so substantially

Richard Prentiss

Right.

assume in And so other, not line. postpaid that's postpaid phone I

Douglas Chambers

That's Yes, in it's devices. correct. connected

Richard Prentiss

talk you Okay. transcript about too. And talking, churn? Did the as review trying we're to prepaid

Laurent Therivel

So we did not, prepaid so happy to churn. tackle

prepaid a a back So down pool fairly high take switching substantively. the step level, on business. just kind of if I At

adds in of that And about so still good quite feel how we're marketplace. the around is we share switching gross so pool positioned our strong,

and off don't is understand the churn represents business, that, is nuance prepaid generally until QX days On of churn that this churn XX important results it's side, QX later. because customers the to the the

And activity good no That the line have. usually feel so we you have. that offers the significantly quarter. of we will about We customer in with us. expectations. We good think cycle that the churn higher levels see is something that I about feel prepaid first management for life It's out not different was of

generally pleased remain I so And with prepaid. quite

Richard Prentiss

post the What would about the off? you ascribe it's what you to? pool around, think the the take an that industry activity pool to so migration? better do or Because to? that Is it down, that you it obviously, as seen. turn what pre attribute in switching worse to it area? trend or would And Is switcher And we've consumers

Laurent Therivel

it's think I macroeconomic.

If spend refunds with phone mobile tax people you look what's people their than at their service. inflation refunds, tax getting having on and other things on going to are

offers business. to probably specific in anything have that marketplace. prepaid it's necessarily higher of slightly think migrations And the because the attractiveness place aggressive is don't postpaid the of the I so in to been There upgrade prepaid

key So out postpaid right But that's it. of migrations it's I then would there now the probably to think, drivers, aggressive X folks. tough and just be prepaid of I some think driving for that because upgrades,

Richard Prentiss

Okay. ramp on fiber bigger On that frame? was Is a And OIBDA XQ. Telecom, Was seasonal be Just low, more increases? so that better like in me. expect the for number of the given we something build? looking trackable one should time some it or the service. slower understand winter TDS Or than a last what were quarter to cost was trying for on happened you in the

Vicki Villacrez

question. so But this adjusted the the year, Yes, for deployment, fiber addresses in some EBITDA going are of to come thanks service Ric, quarter. into going are lot our year. costs our was heavier X% up later to the further our a of fiber be

quarters. We adjusted the more pressure U.S. benefit And just so coming would cost our are and guidance Cellular, really unchanged. EBITDA a first for the EBITDA bit We our to do we expect you actively like should heavier did is reductions, the which find quarter. say, in overall latter little towards I But manage half. pressure trying future so adjusted in expect do, from we year, for opportunities the costs, that

Richard Prentiss

know spike postpaid. Makes really to the as LT does What switcher how devices bit, kind are like? back was, a but of look I you sense. but if you that more out as And that's used to would what's upgrade [indiscernible]. your for market don't there? pool far It iconic little trending. but seeing be the reported on it percent It's one

and heading? you it where do So what upgrade your number see was

Douglas Chambers

quarter X.X%. first number That's from was of of down upgrade 'XX our the in for QX XXXX. X.X% Rick,

Laurent Therivel

I'll Look, it. I think bit context put around a a things happening. few of there's

And affects upgrades interesting be push for subsidizing hanging around that think on much an devices and for it will there's I longer. upgrades. AT&T's We've see their example, industry-wide, how, move the this. to customers price to been seen aggressive

isn't view anymore. differentiation their that think much there I is

And to so longer. devices those for hang on we're people seeing

it. I think that affects

the opportunity quarters aggressive And a finally, good so we extremely dig subscriber a the we last side. really we've have results upgrade in We we to it, really couple of and guarantees driving make And think and we've We the sure churn that down tried bring driving on to to what in done an balance and price we and further positive churn that. think go we between of offers opportunity results. has financial on that industry we're And underpins we're to rate. have we've call. an the job we think churn to now when positive substantively ARPU over improve believe OCF, to protection and I have invest that's strike earlier talked that there, out now done tried the invest -- upgrade about and and

offense that go really And so think into that to there's now and area. an in opportunity on dig we

excited we're about so And that.

Operator

back the no And questions to further this additional at remarks. for call now turn closing I'll time. any or are Colleen over Thompson there

Colleen Thompson

for everyone, Have weekend. reach time a out to if free questions. IR your additional feel Again, you great have please to Thanks, today. any Okay.

Operator

concludes today's conference This call.

You may now disconnect.

Telephone and Data Systems (TDS) 6 May 222022 Q1 Earnings call transcript