Earnings call transcript Q4 2022

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Operator

Hello, and thank you for standing by. My name is Regina, and I will be your conference operator today. At this time, I would like to welcome everyone to the TDS and U.S. Cellular Fourth Quarter 2022 Operating Results Conference Call. All lines have been placed on mute to prevent any background noise [Operator Instructions].

to Corporate conference Relations. like Thompson, to now President, Vice would turn over the Colleen I Please ahead. go

Colleen Thompson

before Financial Web Finance depreciation Relations and depreciation TDS adjusted referred Cellular XX-Ks for taxes, U.S. partnerships. interest, EBITDA, Cellular, Cellular's U.S. our Good Officer. call morning, income presentation Vicki Chief With Web and Financial of TDS which sections Executive and amortization want on both for filed the is Investor to to today of offering U.S. thank our you Forms to Therivel, me you webcast for We this President including Senior you accompany and and X-K, the adjusted aware joining can Officer; Executive see all Chief being sites U.S. the the from President press and OIBDA Vice and are Please Chief TDS, SEC find of prepared and Brukwicki, This Investor the and releases this or non-GAAP simultaneously Vice Cellular Vice Villacrez, reconciliations. from Chambers, TDS call, sites. and from Telecom, the comments or of before highlight and we earnings Executive to and and wireless on Financial including provide yesterday. and prepared guidance make the on amortization slides have LT President morning, us. Web Relations Doug We Michelle sites. contributions TDS Cellular Treasurer; comments U.S. Officer; Officer operating President, Chief our

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

and Slide Street's on in we Francisco, upcoming the TMT IR Institutional be In attending door have James of attending call Conference And X, video Morgan schedule interested Raymond and Future will be please will Orlando policy, XXth. open you're March, Conference we in terms also our an the in us. as Stanley out early so second to we speaking Conference New the or always, then on San in if annual Fiber Investors the with March reach

I turn over the will now Vicki call Villacrez. to Vicki?

Vicki Villacrez

customers upon as and good end past all year, gives Okay. that the business support our term This morning, our services their communities. strengthen long outstanding to our to accomplishments units important that to is objective actions mission us all I'll call meet at Colleen, shareholders, returns. Thank people to the needs recognizing the is of to opportunity positions you, our plans of it taken our year our competitive remind communication higher and strategic provide over you reflect our everyone. the TDS to have and and both

free XXXX, investments flow. We make in our to substantial pressuring in continued businesses cash

business units both talk investing priority, substantial high remains across our will still in as our spend moderate a net the made will worth And we However, to. towards enterprise. CapEx goals XXXX progress while we

X. Slide to Turning

to the future. while have our shorter help believe term mix far We that managing through rate environment. financings maturities any dated of maturities facility, and going remains extending investments which should maturities amount approximately billion the securitization at forward. full $XX rigorous organization, I have asset both end to Both repurchased companies the XXXX, preferred sheet loans, of modest and OpEx at $X.X and in repurchased $XX cash in cash, in very the business flow we focusing on both both right taking term during sizable to X, equity, U.S. quarter, Cellular. fund and a sources balance favorably units for their cost healthy year term Our and again throughout place at and want year with available their including multiyear long also of the million are highlight appropriately TDS stock current CapEx, and revolvers that Slide million continuing we liquidity, once we to we programs discipline of contribute long stock interest

XX again committed remain an group us with it and increases the once for that This our their stretch of we consecutive Importantly, consecutive this have for raised companies elite dividend dividend of shareholders. of we year. years XXth many years to puts

turn the I'll now to call LT. over And

LT Therivel

morning, well. is Good Hope Vicki. Thanks, doing everyone everybody.

Just stock a of quick Cellular. U.S. add. We worth at repurchased $XX million

Vicki's think for heard everybody I to XX, XX, least cut just got I it's number note. off, at

of fair Okay. I macro proud to X, year, and Based XXXX, a financial has did be and innovation surprise. a to of was Slide balance lot and and of subscriber different our I'm goals. pressure, been on it's approaches. the this think about a always goals we number the competitive testing competitive in shifts a that aggressive a subscriber Last past in from economy. environment a an don't talked standpoint promotional amount both goal in year with challenging on And on we've with

best industry, the highlight in for moves in drove the back November. in was the steady us that year. balance And offering in more rate postpaid to to much And markets we in for And those pricing that of So that concept the subscriber subset and quarter-over-quarter third the quarter was a offers of higher a pivoted growth aggressive existing rates. expanded there and really to drive and footprint improvements. ARPU we second our was and quarter, midyear, across entire goal one we to upgrade the the flat launched providing customers,

to of average, customers exchange nothing a device that plans. We're financial rate reduced customers pay rate in-contract our seeing And along for offers existing rate expenses a to price for planned on and pricing higher our rate flat choosing are our good pricing, this are lower tier new our flat promotional pricing. those rate. Both initial helps adoption of that plans. On choosing that with meaningful of mitigates in quarter led full and improvement lower and flat has their flat nearly unlimited impact the

the of in that's contract, to at our handset of when contract that's because those we ended initially customers significant June and at in in XX% than we comparison our So promotions, customers. rate year and postpaid churn lower XX% customers launched out in-contract a much new

from efficiency and we cash of us loss increased the increased were remaining Additionally, investment a down specifically, to cost costs our More and capital that's on in well through as programs, and impact reduce year-over-year year experience digital terms platform, in beyond. optimization seeing and the both there's debt our our X% spend as XXXX of expense, helped traffic. think full and we savings of excluding effects an customer increased basis, significant operational We're mitigate costs in positive inflation. generated our that's also results and improved bad on opportunities equipment promotional and

wireless. Other mobile from now another have in moving customers, XX,XXX the ago. XX,XXX that's the produced customer and revenues move sessions that's fixed of stars in pursuing of full million We're than in be We up from X more XXXX. and our reduction as XX%. averaging quarter and compared this of year year good the year quarter ended another up progress exceeds Tower Our we're a wireless interactions in ending by will we our initiatives. stores up digital. from growth strong apps, results, seeing business XX% with fixed experience areas growing has And to driver month, up cost centers strong four app to forward care XX% our per the momentum the

achieved side, POPs currently approximately of covered On the CapEx making our with we our ended the of our traffic carried results these lower because And efficiently, notice and you'll sites modernization XG multiyear at is low supporting XG network and end deployment progress. good overall XX% is program XG. year the guidance. We by of have our band XX% we

want continue build able band with our progress have to mid to XG along in making band We broadband and band communities out plan some spectrum be that our build We very our to XXXX network in available of in make XXXX. out. wireless XG to significant low areas some portions to cleared we on late partnered mid when bring fixed reach North I plans local Carolina. both Maine also using with to highlight, is access to hard in recently

Although we how the we of state amount can put received to help highlights that work grants small, funded digital is buy. to it to bridge the funding pretty

X our build Slide we investments goals and are strategic XXXX, to XXXX. in and on progress on Turning our

be you customer our First won't by our to surprised and is top improve priority foremost, results. this, and

continued subscriber and had year emphasis growth us continue to see initiatives. and in to growth in can regionally, also our you far expect XXXX. expect discipline. can our promotions fixed financial And balancing with trial You wireless on best by We pricing pulse

to even expect We to more prior that mid us that's band spectrum. in getting growth XXXX. And access

We expect our that BXB, in tower is in on space. IoT growth in revenues our space. maintain expanding team strong portfolio opportunities growth to also focused highly particularly We're expecting and that the

coordination digital mid our Cellular to divide. C-band is deployment, without our most our deployment has that the spectrum planned of FAA date proceed need efforts collective of deployment that's in to relates Americans As engaging mid XG ahead network joint been cleared, band it crucial. our band harm rollout, and in can to our with U.S. delay the delay bridge pre-coordination any to effort that and impede the If once with connectivity confirm

off me share thoughts I on Doug, And hand it before guidance. let few to a

a spend. focus promotional capital assumes continuation and guidance cost of a activities, ongoing reductions Our efficient aggressive on

to want about time. generating a it return U.S. us. team navigating be we're thank the pulling lever flow, Cellular long at year. to and I front grow Our over remains opportunities free disposal on of while improve and for through to our entire goal going excited dynamic I'm the cash term also every to challenging in capital positive

value. right drive forward path and think long business the we're term on to I the deliver

through and So to who you the I'm detail. financial operating to the some now more going Doug? Doug, will in results take call turn over

Doug Chambers

LT. Thanks, morning. Good

customer net highly fixed environment, Connected the increased X,XXX by additions and the a additions by decreased customer with X. pool device XX,XXX, correspondingly additions growth. start gross declined driven churn. $XX,XXX and results of involuntary increase Let's net gross by increased handset additions in due Slide in by a decrease continued and switcher to year-over-year $XX,XXX review wireless the an on largely Postpaid competitive

higher continue prior see customers by fixed the base XXXX by quarter of of driven a mentioned, the wireless churn with growth frequency from of to pre-pandemic customers. driven and churn of was increased by This the churn, decrease in involuntary norms. XXXX, in-contract partially customers voluntary non-pay year, As throughout from offset the increased third in the from XX% up percentage the end and handset LT XX% momentum in our of Postpaid we to XXXX.

also result roaming average turn to due was year relatively rates offers. higher declined XXXX. roaming let's lower decreased declined unit of connections. with on other revenue fourth sales Equipment average results, of Now starting revenues the revenues carriers, revenue X% in per revenue which roaming as higher and operating than user from in has impact expense. average decreased at primarily revenue XX% XX. Overall, revenues negotiated offset decline promotional prior year. Total the the Retail by full our the fourth to expense our a quarter a amounts primarily as for quarter due postpaid Inbound roaming per Slide were the decreasing the the financial in to decrease X% a by service flat

recovery results offset ARPA an increase mix, offering XX. along were increase presented mentioned plan and and product was increase, revenues. in favorable protection in by an device the ARPU These driven postpaid on the ARPA Our surcharges and in costs. increase strong increase an this with increase ARPU primarily are cost partially and promotional LT in in by Slide increases

and tiers plans, the We see in of customers postpaid handset quarter. XX% are our our growth at end these higher continue the highest consistent to in plans of of tier unlimited

quarterly Our Slide on financial results XX. are shown

loss in bad amortization refer operating operating and as XX%, operating equipment before by debt declined to adjusted income For this income. depreciation I discussion, Adjusted on driven adjusted income expense. and increases will

with strong new equipment. As also offers. the in LT existing plans ARPU and we increase our adopted driver existing of throughout promotion value conjunction in million increased higher increase customers, continued on customers quarter. commented in-contract our promotion to in the was rewards rate our primary our fourth This to This loss promotion $X as and earlier, our these the contributed

Bad debt to customers to our partially and incentives. promotional a as churn expense has increased off has priced $XX attributable involuntary average levels the returned million selecting pre-pandemic higher increased write result devices, rate as of

current throughout year. lower rates, the optimization personal mentioned trended to stronger continues reminder, savings relatively which as the prior continuing As debt including in behavior resulted bad deliver a X% of earlier, year-over-year. of mentioned in the cash this XXXX program, other ongoing equipment our resulting and XG our impacts and keep our a lower rollout, Despite excluding decreased all rates bad expense cash cost driven customer as expenses payment inflationary result debt year-over-year. higher sold of expenses other from environment and by LT to pandemic, favorable results. other fourth carriers, roaming expenses expense, ongoing This actions cost and flat with quarter was

the EBITDA, XX driven we declined financial by the factors year similar show income C-band by incorporates income impact results. our in partnerships, impact quarter. where certain for to Adjusted X%. decrease Now full operating dividend periods. and and X%, which year also we driven let's leases turn from primarily spectrum our for to continue future the is method earnings decreased the mentioned Adjusted investments, Slide expect equity of this the in of [while] implementation This interest

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

our promotional will and environment cause Our in a revenues the a continued XXXX, which guidance subscriber impact contemplates expense. decline we roaming in in competitive corresponding a base rates, roaming decline highly roaming expect continued and both and decline of

of billion income $XXX million million $XXX in $X.XX $X.XXX expect approximately in EBITDA. revenues, We billion adjusted service to in to operating and to adjusted million $XXX billion ranges $X.XX

to very date $XXX the with XG we expenditures, $XXX rollout. progress made in capital of million. our the For have We're million is in estimate the range to pleased

Michelle? turn Our to investments the of I over mid our investment managing track, commitment this and remain flow and prudently in business. call this the band deployment and on guidance and our in invest continued network low now and network modernization Michelle of XG our while level free reflects will band Brukwicki, to XG cash the outstanding

Michelle Brukwicki

last to morning, we on we and I'm XXXX progress results, towards Thanks, pleased made longer in and Telecom's also XXXX strengthening to providing people you Telecom, communication year. businesses, our highlight connecting I'm to with mission, everyone. that Doug. grounded fourth world term mission TDS that quarter report better high shared proud is and Good supporting year full and create goals quality in At services, TDS and a communities. we are our reaching by the education

markets we the broadband be provider Our goal is in preferred to the serve.

this will in strategic TDS drive you returns Investments will that see and these XX, strategic areas strengthening can and focus Slide On position. our improved profitability priorities of over help achieve ultimately market us goal. time, Telecom's financial

and fiber center and resilient people is experience do, improvements. our We customer finally, engaged, attract foundation So And we investing business workforce. the entire what in scale continuously exactly of revenue are automating and expansion, legacy keep growing we can primarily and this in reduce through at operations of We our to highly our our ensure we costs. market doing? customer invest the our talent. and We're retain we're our continuously streamlining everything dedicated top to

XX. Slide to moving So

and we to at are tell to Let on headline progress you we're track. three There metrics metrics you our reach targets. are longer pace those on our I'll goals, term is a for the highlight monitoring towards I'll you now. me our we're ensure achieving moving update XXXX certain

The service first addresses. of metric is number

We halfway XXX,XXX, We X.X fiber with are service there. addresses we ended million XXXX marketable so are XXXX. by targeting

progress that fiber. served addresses making progress. XX% addresses markets. our targeting of service being at reflects to fiber markets and fiber of ILEC the second of fiber XX%. percent We're fibering by we're our XXXX, with well serve incumbent the we growing total XX% addresses with and is to XXXX as service up. ILEC are as good be through fiber in XXXX, of The our metric of served ended our by end At by This XX% were expansion we service we're working specifically, our And addresses fibered to up

to to our XXXX, is higher. with gig our speeds finished speeds XXXX third By the And or at of those least of metric we're footprint. The with of expecting gig we XX% percent XX% at X footprint speeds. offer

with expansion the pleased so fiber fiber our we're far. So results and pace builds our of with

We business in projects. these the still state. program, and market have rates plan seeing three from our mid scaling since our returns and double are that year our continue is digit mark, validating Based experience, our to XX% our navigate we continued on and achieve penetration expect builds at we we've that getting to launches deployment We've XXXX. expectation starting broadband positive markets in least seen we low in completed. those up this of on service address challenges to successfully steady been of success our we contributions around The cases launched in early to

XXXX, Slide what XXXX. accomplishments in XX% from I'll XXX,XXX by is were that We stages was grew we At addresses. service had came we year development. XX, quarter quarter, over fourth in that various about from X%, a and increase end, highlight delivered On XX,XXX added of some which of addresses are XXX our This fiber those footprint service communities key yet. highest marketable in our the delivering

During several Idaho. including offering Janesville, began new communities, Nampa, Oak service Claire we quarter, Wisconsin, in the along with fourth Oshkosh, and

up service going we is continue we're delivered deliver over increase XXX,XXX what Our XXXX. of fiber addresses in momentum This in will XX% strong from scaling and an be to XXXX. to

the As a quarterly reminder, we impact expect cadence address of delivery. seasonality will service

this year. So the to going throughout is steadily build

broadband most program. our programs A-CAM needs with also continue the our support rural to meeting state federal by We networks and from upgrading broadband copper by grant markets the in address our under obligations

will optimistic decision still of and FCC a to hope program, A-CAM adopt the we an are extension the that soon. We final have

then into communities. extending path fastest for program the first funding TDS would BEAD current federal take fiber Telecom pursuing that and believe our the to the deeper still We also provide program A-CAM

positive are these results. broadband of investments All driving

XX, year-over-year a connections. residential of customers the broadband Slide from on see our on ago. taking we for the broadband greater with speeds right, Shown on a year second shown per or X% XX% experienced in up and XX% As that's we graph greater, megabits increase total demand XXX

offer Residential reliable we Slides And this financial fast on X mentioned at our offset all offering partially least areas product. now increases In highlights. generated we're before, of of in I'll total the On customers increase seeing its XX Total are now XX, revenues service As XX% average markets, some X% overall for X% legacy share in revenue. we I across increased X% increased X-gig product. our Telecom speed year the an where XX% taking gig Price full revenues in by finally, gig TDS focus a in even our an and offer can offset has and the to And revenue broadband some of new and markets X% service service, broadband our declines. promotions for per drove mix quarter connection. product residential growth quarter. increase residential as footprint.

revenues offset and the left, by declines in price in full on the wireline broadband driven for and year, increases connections. year-over-year of to Residential shown the decreased connections, service following by incumbent and the growth video in lower revenues As delivery. X% and chart address partially quarter year-over-year due the CLEC Commercial in voice increased connections. expansion timing revenues primarily cable increased market

growth. to and revenues wholesale our and current expenses due X% X% year lastly, the in year. future as the increased And well both the supporting as quarter for X% growth the for decreased quarter for Cash

have costs real and services. shared the include yet. fiber in revenues These direct marketing, addition estate costs, to to support costs our technicians as come sales, incurring we're not So such but expansion

fiber deployment chain cash capital and advanced our free in and program growing investments as EBITDA due expected, As in million from adjusted longer times. year investment $XXX mind full mitigate the X% of of prior in strategy and increasing support to year. our on these run. to for expenses as expenditures return a cash that flow of to the Capital over XX% long for multiyear lead Keep well were capital the purchases supply goal our decline increased the in up fiber quarter increased the resulted support

On Slide XXXX. for we provided XX, guidance

residential business. making the reflects all by EBITDA goal markets, million we're revenues forecasting almost Our $XXX parts $XXX Adjusted guidance to in be fiber is next of reflects factors our top which our By years. our and between network several billion. This XXXX. end however, line offsetting to been of our communities expand over declines $X.XX growth footprint in our XXX to continued of driven XXXX, launched. the the expected of enhance foundational revenues across Adjusted investments improvements have legacy million telecom will EBITDA upfront requires in our $X.XX the in all total We're and of expansion, our of continued spending. billion

are to the builds market and penetration, over in mature pressure expected XXXX. EBITDA expect and $XXX between $XXX our we our Capital This chain million we is address to reduced adjusted expected increase million As be to reflects and lessen spend on time. on fiber advanced equipment are growth. constraints XX% capital allocated of to supply purchases service our broadband increased delivery as nearly and spending expenditures lessen,

want to call for a We turn we the over work Colleen. turning I XXXX. that I to in into and our priorities, call, continue over of on are momentum back all hard XXXX. now their and executing to thank the the I'll accomplished And expect Before lot team

Colleen Thompson

for first ready the we are question. Operator, Okay.

Operator

of Our line James. the first will from come Prentiss Rick question with Raymond

Rick Prentiss

could. questions, I A if couple of

guidance. trying pressure as that a the maybe we're Just assumes middle kind year? competitive we First, 'XX the that If marketplace, compare more guidance out for how kind guidance the in we sounds LT, of started to of guidance. might you've promotions. starting like of continues with midyear the you 'XX 'XX 'XX pivot Cellular. addressed with laid did 'XX back needed guidance, be the U.S. the pivot to competitive It how aggressive think you and to opposed

LT Therivel

pulsed out. meaning characterized market that We say a essentially I'd and approach made moves take more to in the you've is aggressive Rick, accurate. the in it the way that and trends of the half ‘XX, upgrade, we in the second

or kind actually that's only it specifically week here with existing the our we've of designed flat ago, pricing think in promotions replaced customers. appeal place, new requirements we we rate also them which marketplace. no did our about famous in same At competitive we multiline have pulled notice is offer a and highly to hidden to two to may time, we the You

with you competitive So to net response the can If see our of environment, to in movement the moves add those we've expect in those continued And of kinds seen right? moves we've performance. XXXX. look seen it, you quarter-over-quarter, positive in -- benefit

you And similar so that probably view it. on terms as our I general, to of in competitive fashion as yes, can in think expect moves think the second doing the of a environment XXXX in well both in to well we're compete half,

Rick Prentiss

coming debate a adds been maybe There's back happened? adds a industry to of of level industry the of more on view area? wireless normalized versus the the what about your down level What's lot level

LT Therivel

me to, hit Let it Doug.

you've sense think of a ahead, I got this. Doug. Go

Doug Chambers

Yes, Rick, XXXX. during we're industry increase an projecting about X.X% for

in of below So those two kind so it's points. data been, population where growth above between the

Rick Prentiss

how we about year? you set think not Just adds people does trying mean data we're And up points nine is the phone through months, under contract comfortable? And got you the think and negative more into postpaid ending, as to to February, here seeing churn. said the the going phone with How maybe or think postpaid have Are past we churn to for enough negative? you've action in should you've with contract. QX we in that I that, have get to that sitting -- that as six the instituted getting the Sometimes, won’t benefit hopefully we're out? playing

LT Therivel

I kind higher starting tell So it little don't to some or more offset in we're to a that on see We're Rick, that not. fourth of moves stayed In the performance no general, see churn add to improved we that that believe we we under signs We to upgrades. in gross QX relative expect be side we've comes positive of due adds showed BXB churn, churn. see the when is will getting it to get continue people the really flat contract, I get you quarter-over-quarter. we're because add the expect every mean, general away always QX. quarter year-over-year in numbers. a customers what the to made rate. to dramatic specific pretty of that bit you throughout when In improvement improve see that to net and improved quarter when important what couple positive some projecting that continue. contract, a performance to more consumer with And mean, general, with comes part highlight, small improved from we've do or momentum under I'll tricky net year net we when to more adds is quarter

I necessarily in positive straight a don't just have moves drive line. the draw I are general, expect we you can So think resonating the that to expect marketplace that in continue But and I them performance. to

Rick Prentiss

moderating XG market cash flow them? CapEx customers from to Vicki, means, like what And of CapEx, to that me. means? customers will But do XG from environment. LT, not, I the appreciate what back in this what it what take understand and interest means what comments sharing understand gives wireless. monitoring circling the to the one it about help to standpoint free XG if Last rate

LT Therivel

you mean that think An interesting I different about there's question. couple a could that. I of ways answering think

You've when in with various to it's wonder deliver little customers. been and of to if pleased, And will our I I resonating tell a has the in wonder got, we've fast look all to customers this. the what We're rate best is terms at hear marketplace. sometimes at I are that brought on about how XG, and capabilities of XG numb customers. you industry with do how able build you messages one and competing out this the hand, They sometimes talked the

us are only to the right? side it. customers the the We better And but of about better, traffic. sites where modernized, numb give customers the that of not is over the coin see network, meaningfully so so of feedback and our XX% be we that And network getting would our over modernize metrics earlier flip carrying performance do our the metrics perception specific XX% to we talked our

that I I are that performance they're customers numb to to think numb claims. bringing. don't the think we're

okay, performance in an distinction, sitting the we better. say, do I'm we Irizarry the right? scores, the so then you'll well, important customers me, numbers a are it see And And right? that's care. here perception Engineers to always see chuckling, is next lot in and say, it Mike I will Because, mean, but

meaningfully network SA care. stages That our better. where yes, of perception our says speed deliver in early launch. XG we're able modernize that The to we that, the is customers performance We're the

so I out band. think meaningfully about start also experience. And see mid customers roll And we SA, will as talk we to improved

we roll that meaningfully as experience. result out mid better a in band, So will

So question, I'll just meaningful for in the from was to we're customers capital. of is them feedback where kind is approach balancing how that off we back loop you around what we're getting doing we're with capital. to the a which And now and prudent targeted what spend terms led back of

the And money and need so the the getting to that a customer we're of good we're feedback in we the spending balance place and how customer we feel very managing where metrics pleased. about

how a you of gives it. that hopefully, we’re So tackling sense

Operator

of line the comes Flannery with Your next Morgan question Stanley. Simon from

Simon Flannery

wireless, good going can I fixed well. LT, the is momentum start, to If with hear

You've later the this coming C-band obviously got year. on

want either the you think on We've seen as or broader you a the you BXB T-Mobile wireless to what's just participating going in rural well. lot of that where we have with both an latest of on side? of BEAT lot success that's for a Do kind side, in interest think still kind product? Is might and Verizon, latest program. So thought a ex-urban do then wireline quite on thoughts this a the And footprint? lot product or and your deploy to see on wireline suburban of of a interest it you something be you

LT Therivel

Let's start with fixed wireless.

So really differently. inverse view it's our we I doing, is don't almost but little a that mean, a from approach I It's deployment -- is of suppose actually T-Mobile I the bit what think different. the perspective, market

now what explain we're low product. suburban. me the and in And that in is recall let's rural so this between basically a rural it, and is let success just deploying right it's huge we've really, band And then, seen bridge product call where

think, couple not we're delivering, vast this thus millimeter a To that speed have the us, feel our that been But low whole experience. XXX -- experience when in it me, on deliver high of is of be a front for market speaks deliver And sales the launching And looking on opportunity band. us. tentatively, couple up, able I opportunity new particularly we're have a when band, we of far when we'll that's start put this we to of wave you -- proud do that trials. at mid-band of but of the megs majority we because do a We that, a product product down. opens to mid

That see against about still, of band. think This on just there's a product I be will We rural, low potential we XXXX, ahead call opportunity if when so monopoly. cable cable. And works well suburban. a see lot very growth a lot it product of

be to think, I more XXXX, starting to band in then, closer a competitive urban we As product. we'll we'll move suburban because mid from able highly have areas, to launch

this about fiber available to else, to home see still mean, home. and obviously sell accordingly. one to to place will that one us. of want is be But don't players go from and that's this. fiber I there's we where I substantive fiber and customers compelling physics The geography But to fiber a able those product The consistent really the to is whichever basic that's should humping happily us. the the this price buy been with say think still would it it customers robust place, We'll I've everywhere

of with band, in beyond roll we 'XX 'XX mid-band in in as you and with low see lot now. runway 'XX but just -- a our this, not with So

moment, and talk they America. cost telecom have not we BEAD there's fiber. people can with BEAD a to with saying the fixed me I dollars fiber. there's how Let where have I'll sense to is are fair -- Those there of connect of places BEAD spent be nor and about that she optimistic much that we to in lot sense own time is still to not and every with rural quite amount out and conversations viewing math over to have. And United simply flowing then business fiber. time cost homes opportunity. lot know these for efficient a still I both We're states. be is on going going that are billion of it you efficient, the neither to a businesses $XX a give efficient is hand connect with of that wireless. We've sufficient and notwithstanding so cover trumpeting everything that home across BEAD States it a not people that going about and our done this And And Michelle our can

able a certainly, product XXX for the we up. and no cover sell We XX BEAD Keep to going It's down. mid people just XXX to go rolled years. can areas XX band, to deliver out can rural when deliver hey, problem, tough megs in to product wait say, you, mind, down in threshold be we're a in a that's we to is

We we safely can do time. that threshold. and of in it meet fixed relatively can that a period we can So do short with wireless

And of so in this. a states the we see lot on do working opportunity with

then But that significant We're I map a now. customers a I right expect And with that. middle challenge right us, beautiful growth, dollars in going as As new to we the don't at terms know, fixed both you mean, to have of bring that the I of those wireline pretty on end the new now bundle meaningful we view to wireless, opportunity in so still the when part on that the overall fixed through to we're XXXX early get until see process. we in customers state have flowing earliest. aggressive back market the about wireless. bringing of is wireless for think

And our so grow mobile fixed will along us with so base, wireless customer. wireless the help that our space,

down is But bring that it the will flow. thing do it other our capital will

we -- towers So tower to able been places then haven’t tower those opportunity in grow able the more And and dollars, as as put we're BEAD expand want when have of to us haven't do to we towers have towers our as we so -- revenue leverage economical we these way, because have before. expand place we will some a want help we business, before to in revenue. to in to being to the able where

mind now, but right average co-location So our and rate is X.X%. one just X.X of you, is industry we're north

And have co-location so put to the we work. revenue tower to opportunity

mobility we're I of has and three really fixed good stream, wireless. of stream revenue with conversations part terms as tower so stream. revenue fixed in BEAD is states, streams thought the pretty that revenue money on a wireless stream, optimistic co-location telecom about the this fiber off well coming know that we dollar, based opportunities. go that revenue early the And our to see going to And

it a that And give so color Michelle, let you, to can me you little bit hand on side. of

Michelle Brukwicki

So Simon, agree we have the LT do we from generally said, little unique TDS a perspective, side. with the but perspective from that bit wireline everything Telecom a of

of are for front us, So there's in programs us. that two federal actually

be addresses get addresses of participate would that they that to it's our program. And is are A-CAM that program. are the pivot provided part XX a We get speed BEAD through the customers us is the faster established, that the for something back proposal those that those end under in the already down very speeds And that great a And SEC faster take up. help considering would That years to talking that that we running. that. of already would the could in those almost is very, the quickly. already to already halfway program, A-CAM on exchange From great to higher of that support more opportunity be speeds a a as one already be perspective, that's first same The revenue that speeds. development program And program. We're They're program. program. into require XXX

we the for track that us. to that opportunity. and program opportunity a be program. see as BEAD be other But program, great can one under participate going to that's would there that BEAD excited So then another us we And is are we in take also areas believe for fiber that the we do

be that pursue best to flowing said take to LT with better what those going mapping there there order of take hard if going be the companies areas XXXX are funds territories. out that as and money are BEAD, places our with it's that. opportunities combination all the really And make probably LT likely important the rural of and us that through opportunities through But U.S. as the fiber out. fiber for like we'll under customers, to going to continuing way get are challenge to the But to program. FCC to all certainly got to We And two we're working first doesn't well, to faster, in serving this agree work until most broadband, and it, to A-CAM Cellular with until partner our probably opportunity. we year. about already and yes, serve that We've start where on talking sense are higher, think said, those get an

Simon Flannery

fiber build year. about talked the accelerating this you And

there? to labor developing supply what's inflation, you think any to of a great? cost up be about higher color I Lumen color about Have there kind got There's talked about that pass any concerns stuff, had going or $X,XXX. would on

Michelle Brukwicki

Yes.

So more XXXX. we this address keep delivering to the shooting XXXX. are service program XXX,XXX for $XXX,XXX we planning compared in up year, addresses addresses we We're delivery. a to Each developing nice year the scaling and keep in in increase keep under delivered that

we going to XXXX. our So on program by path our accelerating are that $X.X million yes, to keep

business actual cases. build, the the that's already into cost of all of factored terms our In

reduce start our find in and opportunities to with year, XX with some months, costs. costs slightly to build we can in Over vendors did really in of see But trying contract we those last markets. we were working RFP those come proposals some the where diligent higher

we're can months, returns to business XX CapEx And the all you'll guidance hear all that's that our cost that still those why already achieve still case, to of over so all business digit Even lot adjusted me talk when we're the into business we've the really hang with a still into getting expectations. we cases. seen of that returns mid looking XX low for. double our the you about those out those is everything last case together, And of factors and attractive does factor factored in

Operator

next Your the JPMorgan. Cusick from with Phil comes question of line

Unidentified Analyst

as quarter. of single on on Phil. And we've to digit despite about the think I the and then hoping digit low Kind was how the grow drill ability for Congrats your seen on ARPU growth into et postpaid cetera? look to should hikes, single growth mid Jerome business. promotional solid driving down It's forward? to pausing heavy moving what's ARPU XXXX, price we the investors ARPU environment at

Doug Chambers

to during two the up new of year two tier and with we So with it the that moving growth, ARPU with the handsets year thing year stack. plans tier was our on sales had top ended by that lot offers. top was also the strong our customers efforts that existing of XX% team, plans. drove one our XX% respect A requirements started We by tied promotional our to on driven but

to we product. So a where as margin increased earn that that new was well the really provider been tailwind doing revenue, migrating slightly of ARPU. a a the profitability we penetration that better better of protection device customers as project. much We've We're in for

helped also in surcharges We as at some had of that XXXX cost recoveries that went beginning well. the

that an So increase. growth building X% looking I is not all sustain the level. ARPU a likely that to rate is at to goal, to XXXX, say, would led that still

of One don't exchange that rate Obviously, a the in lower that, of reasons we flat promotion. rate support rate level pricing. pricing. the with same flat is But have we for

But stack. an the on rate still flat is ARPU, a moving customers Like up at But is bit dilutive. from standpoint. focused looking XX%. we're a there So just alone said, there profitability pricing I offset

plans that. to runway optimistic long our customers, to value are to sell a our have We go higher and about

about we think So that's XXXX. of an sort of overview how

Operator

of Citi. the with line Rollins question comes Michael from next Your

Michael Rollins

Just is happening a at Can a that two to relative of of what's U.S. a up-tiering there service revenue is a I terms time, slight one to conviction so core the terms impact for service taking you back, landscape? questions, three just with One more in opportunities, the and service decline. if looking unpack Slide revenues XX up in time I'll on guidance the as could. then grow -- follow bit the other revenues And one over And step is roaming business if you think Cellular could. wireless competitive can a frame? the about these I that positively and of year

Doug Chambers

it's guidance, there's rates down. it. whereby So that's to will going an you impacting the on service expenses that roaming continue we're that It offsetting impact on decline reason has important down. expense hit revenue yes, Roaming But And revenue service revenue. for driving remember been declining. to the is roaming

So from and into XXXX go it's well a cash year line. when flow we profitability standpoint, accretive slightly this to operating project actually as you down the

is on alone, actually the there. a line that's revenue But positive. decrease a there So

for pricing starts line implementing four a and our service rate growth goal three, service key all service and that line and priority grow and IoT service time. compelling carryover But of one as well to into a all that the yield increased that's up some impact flat connections and key There's revenue. And in a on and over two is up factored areas. revenue, we way to in base our connections ended price wholesale factored customers over XXXX. that's particularly in that that's revenue time, and revenue some that absolutely, with our a lost having with into tower growing as as grow XXXX to revenues. And other where motivator of B&G some with for certainly obviously point guidance. during We're offsetting thing other The base really revenue, the we

Michael Rollins

the or just investment strategy monetize the interest describing shareholders? latest opportunities operating opportunity debt that the fiber at are What And would term business, your wireless. to on then in whatever investments the for and you've be your in been with in and the thoughts looking wireless tower

LT Therivel

sure use the to that to than generate isolation and together believe right? towers they can a We us that something make sold. that, can So the Mike, good have put I can't And the that consistently And we I'll example. case. is assets and it's capabilities evaluate, in continue have we we to mean and want we more that the as moving forward value

drove tower Our revenue percentage portfolio growth double year-over-year. digit

continued the opportunity revenue average tower rates, the not are but discussing access, they backhaul sold And perspective, the reason over And co-location the operate from potential market can't lot de that expect portfolio. mentioned growth this it that interestingly right growth versus industry a just competitors the see about you last gives in enough, is of X.X now got quarter a We We've minimis conjunction to revenue the X.X. the was earlier I side. sense here. on is a a access first we're shelter. a time they a also we And And cannot. just that tenant but discussing we because to we're tower network can the portfolio. access. with access to to in our tower wireless generator don't actually tower things and Those

the having together more business tower growth assets the So drives in business. the and benefits tower

Obviously, the And denser edge. and intelligence fact to a to the year. still being little run, a to the if network be beg high costs out, we at long towers worked networks capital move in and and fast the as more. networks take need XG, XG denser the a tower to a I our at that but on talking if build you a more good look able you're to your to intelligence right, conservative lot network standards landlord pay in you with lower. being talked way, to notes it by means to is next at at I be what the Mike's a be? edge, permission XG getting and place even touching makes build But And Similarly, more going about level, in going XG, are don't you're bit and the the have more with have the being out forward and XG

remain are to and that drive better It's growth cash answer. a growth sure flow in And assets the comfortable and evaluate with so it. with as ourselves We make together together continue the revenue well. growth is those more every question to we that quarter. comfortable answer we ask want But we we're

Operator

Your next of will come question the from with Dluzhevskiy line Sergey GAMCO Investors.

Sergey Dluzhevskiy

question spectrum on or to are in prioritize as the wireless becomes fixed terms mobile business capacity deployment. do types needs core about start first fixed is fixed plan wireless side, available the you wireless that for build My C-band your of how of geographies and you the business thinking mobile markets? LT doesn't of sure also, you And and to versus capacity, needs have sufficient business for make capacity core the you How suffer?

LT Therivel

that is is thing few that wireless core very, fixed our that, here beautiful on we exception mobility investments a with that make the there business that targeted builds and The very support to the about of builds business business.

it mobility business. to made means investments where to by make in we the very we look far, been of the you Mike have mentioned of a XXXX. Thus that by that, on seen generates challenges kind And The That that to revenues also, have few customers business and fixed have network. we're architect those effectively. We've the more increase And that from wireless happen more perspective. margin. -- needs support have done attractive capacity creative flows. attractive C-band capacity really will support we us what capacity the good our which turn where those that's to and targeted customers, sure although builds support of we to margins cash will X.XX not and bulk have place of business driven meaningful the the underlying will is kind a is to And deployment the things team driven fixed able and that margins attractive throughout really to so that some enable add a capacity fixed and deployment serve wireless. much our wireless into

capacity challenges see don't from arising this meaningful business. we So

that to be the of be will in range continue you're the about by of that's you why America, rural building you within to bullish customers, about talked X-kilometer BEAD. XXX I pretty core going if if build going be I -- the to of to you're mobility referenced that's business. going we only with only that fixed go this the continue customers a I business you to tower, economics. tower business for range of really driven to were the rural for if driven tower America. mean the dense when And will a a and need to pay subsidize were build and prioritization continue in that wireless XXX The

to. wireless. make so And economics beautiful we part it's the fixed standalone have But difficult to the on is don't

core a have We it. that subsidizes business mobility

And also have and so the and we capacity for capacity to demand since worked that that spectrum nicely, pretty online. business mid we that continue out the band expect coming

Sergey Dluzhevskiy

My second for is question Doug.

of be You optimization is of mentioned cost U.S. margins And the moves. various in efforts. market, it competitive is intensity continue for it part continued pressure counter your under reasons, part obviously, to Cellular’s

efficiency are of What provide years? could the the and of XXXX larger pressures? some few beyond for are offset savings is that next of you that place some All of meaningful you putting But pressure think margins. to some initiatives on what have buckets see that cost the of over in cost those that you

Doug Chambers

really Sergey. it's business, the across Yes,

years, we've software, With over and network on every examples down. have with contracts money quite of area with seeing renegotiating into agencies bit of budget. those. going our we So saved backhaul we where past maintenance been are, a savings way done side We continue sell to rents, those have vendors we're with we've amount marketing bit and to network media a respect forward. drive to But respect our and single we'll that quite down, a program built our a driving significant the

that look since we're So and placing But we driving formalized the really you -- XXXX, buckets we're that's a the program been of we've the big in bought doing at through savings spend, main focus. up. and it's and haven't business it across if a where

Sergey Dluzhevskiy

question both and Michelle. last is for my And LT

efforts, do funding their at believe other's government TDS selling you mentioned including what XXXX, doing Telecom investor these the potentially step applying of Could as and of big more have or in provide I the both been already each collaboration So initiatives on partnership or term? that forms you medium companies And conference, over far what as kind greatest MVNO an broadly in creating color as see Cellular products, value opportunity this you management earlier up for funding XXXX? U.S. you're will collaboration year relationship, just for together.

LT Therivel

one? to do Michelle, want tackle you that

Michelle Brukwicki

to in. you feel LT, free certainly jump can I start and can Yes,

a weeks some was thanks, efforts mention yes, Yes, -- couple guess, together. So did a ago, that we're Sergey. few I we collaboration it doing

On of get our U.S. details TDS launched can during we working the how bundle that product product midyear. is can all through XXXX hopefully certainly, would way of an services our the launch, MVNO that so front, Telecom into get of we under MVNO Cellular we by And partner offer our we to territories hope want where our overlap. sometime get to We customers. with that wireless to

network. cellular XX% be However, of our territories the U.S. our perfectly. addresses by About don't covered overlap wireless can

well. other have with wireless supplement also will So and partner to as carriers we

working of the are that. we through So process in

on to selling. We and cross we're also conferences, some the mentioned of earlier working ability one at do still the

working TDS could if seeing in certain that selling an Cellular for uplift retail that well companies. be we're of geographies, stores broadband the So details through Telecom as through U.S. both and opportunity

of And on small I the details some so then mentioned are of have And Those probably do anything and way out, through those reach we customers partner more, program our we can a earlier, coming. expanded But a the way we've some get test once already But how high discussions in combination that with all in start be if learnings a program, each state we don't the those, level be we'll rural still discussions as in to other. wireless. could into economical fiber guess, and bigger. and started BEAD little yet. in we'll see of possible firm about order areas that in most bit most I that fixed

like But primary So I else LT, year. this is and are think you'd doing talking to those together that about the anything we're there that things add?

LT Therivel

you and three the big co-selling BEAD MVNO, nailed No, Michelle. opportunities. I are think it,

a think covered So Colleen? it. Thanks, with chatting It was good you everybody. I you.

Colleen Thompson

a Okay, additional your that Have if good again, reach was please for you out our everyone, have today. IR weekend. last questions. question. Thanks time any Again, to

Operator

will today's that call. Ladies and gentlemen, conclude for joining. Thank you all

Telephone and Data Systems (TDS) 17 Feb 232022 Q4 Earnings call transcript