USM - Earnings call 1 2021 | United States Cellular Corporation

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Operator

Good day, and thank you for standing by. Welcome to the TDS and U.S. Cellular First Quarter 2021 Conference Call. [Operator Instructions] It is now my pleasure to turn the call over to your speaker today, Ms. Jane McCahon. ahead. go Please

Jane W. McCahon

all and which joining Grain, and your everyone, thank Investor our of make and are have section presentation Thank to Relations can prepared We good Cellular find hope U.S. for accompany you to want us. well. this all TDS of that you websites. the doing we morning, you, comments I morning, aware you you the families the and on

comments Therivel, are, and President Doug Officer. Financial prepared of TDS: Chief me Pete Officer; TDS Vice offering With Vice Chief today Officer; Executive from and from President and Finance from Telecom, Sereda, and and President Executive Officer; Executive Chambers, U.S. President Vicki Chief Financial Financial Vice Chief Villacrez, Cellular, LT and Senior

before call including webcast being Relations amortization, U.S. Cellular's amortization, on Please the see U.S. income referred and highlight reconciliations. websites of or non-GAAP simultaneously contributions We this operating and adjusted websites. TDS the to Cellular for depreciation EBITDA, guidance depreciation slides Investor those and call, both or adjusted wireless is before taxes, This and on for provide to interest, earnings OIBDA, partnerships.

X-K, Cellular including U.S. SEC XX-Q press filed and Forms their releases and TDS the Forms yesterday.

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

as XX; turn are then Non-Deal policy X, And out [ Virtual with we're Corporate attending Roadshow Access the New Exchange. please on schedule, an June now you're open us I always, meeting In terms with ]. on the policy, us door our doing Slide to And we Pete? Pete Stock of to JPMorgan or York in our open Sereda. reach a the Event Investor XX, IR video will open Virtual phone call and if over remains May so upcoming interested

Peter Sereda

Thanks, Jane, and good morning.

its balance the quarter strategies, I aware to to presented We ]. our Before want TDS Starting speaking [ of segments and and segment, to this into disclosures change cost cable the you Telecom performance at we leveraging with change the belong the aligns not only will to view enhances become present objectives. depicts now strategic [indiscernible]. our will and this about better the wireline make sales progress operating preeminent against broad... [indiscernible] Telecom combined the the the how but reported how believe business be and funding sheet visibility evaluate a also manage The TDS performing base single and is in today success

Jane W. McCahon

Operator...

Peter Sereda

change still sorry. segments -- The yes, are there? The I'm you change in -- in

Jane W. McCahon

Yes.

cut for You a minute. out

Peter Sereda

in Okay. segment no current which net in broadband cost a change been -- periods and combined presentation. impact The of conformed prior base our in better in operate. to preeminent Telecom we market and single have The view the leveraging income prior the been in each reporting depicts progress provider conformed the and TDS on to has become periods success have

in tax does to the not we very fiber-to-the-home of everyone we in building to income XXXX tax to in benefits the follow comparisons, XXXX our made impacting in disclosures provided have important in CARES that XXXX I want our rate Act, remind and which can XXXX. in the so of rate progress Also, that have due a recur closely benefit a results higher compared that onetime that notice enhanced progress terms more initiative. year-over-year will You presentation of out you our this today in

notes expense, interest U.S. and TDS to select and lower market environment. TDS the of of U.S. million its notes. X.XXX% given Cellular $XXX for redeeming a Regarding both $XXX our million X.XX% its redeeming is senior of million announced April, its senior and balance total and senior both sheet, are X% is notes $XXX of of redemptions $XXX U.S. million. favorable senior Cellular TDS Cellular In action taking notes,

We for ourselves to our look continue avail expense. other ways low-cost vehicles lower interest to will to financing of further

calls, the of is As corporate we've maintaining one discussed on strategy. of our prior flexibility pillars financial

sufficient facilities we at the to significant have businesses. fund retain cash to worked and balances the long-dated time undrawn the financial low maturities, resources same making years, credit levels, relatively leverage need we we Over our have debt while revolving sure

the As sources, X, including funding and consisting equivalents you a quarter, facilities. cash and of to good credit have continues Slide TDS available see position, first available cash ample at on end the of financial

we markets expense well debt available will to as mentioned. notes capital access the interest is steps previously be revolver excellent taken. as cash some our required While further of we and our the cash drawing have if will on and reduce using are remaining ample as our call to balances partially TDS additional believe to We

$XXX TDS are credit in fiber XG network In U.S. raise deployments debt. stock, investing in protecting will significant spectrum fiber modernization, aggressively and in both This Telecom investing and to Cellular preferred expansion. currently for while and TDS million transaction primarily used enabled in Cellular the us perpetual U.S. with funding investment and rating. TDS our March, proceeds of Telecom cycles, which repayment issued be

$X quarter. $X Both return to opportunistically dividends. and their TDS worth worth of TDS million its a of TDS through purchased U.S. to shareholders, shares. and purchased Cellular in small amount each Cellular purchased primarily million value continues U.S. shares the

a are I opportunities our growth will over position each financially turn we to advantage in in of to of businesses. call sum, solid take In the now LT.

Laurent Therivel

Flip morning, good and Slide Pete, Thanks, X. everyone. to

simple. are time. strategic return improve We're over growth designed Our on capital to drive and imperatives

thoughts for a priorities. to then the I highlights to few the think this financial I'm on to cover quarter, going strategic good first and really we're off going Doug I'm start year. a provide let operational

stated of to and one that this on by a our I grow strategic We in leverage is MLA the opportunity a of business. to assets on previous into Wireless. of enter DISH or lease our master objective areas calls made the signing agreement April progress partnerships, better with First, tower value

contribute tower this mind questions. agreement so confidential, beginning to revenue in XXXX. additional to deal remain expect to in keep got growth on our that We details Any have the if you've please

to last to segments. and and drive some spoke new plans prepaid you approach including for in I of drive growth, market government quarter to our regionalized a our business initiatives about share

these, in year-over-year and you that improvement in pleased full have and I'm steam gross churn additions and in And We on our both improvements postpaid with for progress. see prepaid.

Grown for I'm we also been Wireless. its next of brand local our tagline, the outstanding in U.S. its branding network, excited new Cellular presence have known markets. our our highlights, always strong has evolution for America's and and Locally journey

what sets apart this competition and is it and think culture I us our reflects our values. from our

about the of high, to competition. intend More industry we intensity respond appropriate. wireless competitive The as and remains

that's can the the to will live total rational on remain in auction, of world pricing, we promotional I spend and most Given C-band related and think a the I'm devices, continued that economically. activity expecting

position. of millimeter each wave. layer our XG mid We're Network network our our words XG spectrum, and program and continues deployment. We've modernization continuing of low, a network over performance strategy. few multiyear on A to our be hallmark deployed

Our low-band XX via degree some available initial states coverage on spectrum clean today. is XG deployment to for in

when deployed CBRS those in access were wave footprint. results occur available. to of in pilot We spectrum plans with in year, is operating wireless formalize satisfied fixed now our X communicate markets. spectrum our become purchases. in millimeter launch C-band combined and third of markets and all our When quarter we have The Also, the test largely our we'll with order holdings, this midband offer the in to we nearly expected

X recently to wave continue capabilities radio achieved on with additional wave X be XXX results millimeter we testing year and of speeds distances second. megabits speeds spectrum our from approaching We performance with base distances propagation exceeds average of We station with and This per performed X millimeter line second. gigabit per kilometers of of last of enhancements kilometers, where the achieved sight average optimistic spectrum.

say retaining same do I believe stressed that approach differentiator. to talent between I'm to ever to has matrix focus want everyone's really a home on our work a on drivers responded. word need and than comprehensive we're diversity, team be a I'm and and complete year to convinced harder just pleased is constant that time about past really but This people, strategy We're learning significant visible more of has I to equity drivers a of attracting flexibility, the talent continue splitting important, think environment Cellular Finally, and more environment, work aren't move going benefits with tomorrow. the talent. yesterday as inclusion. U.S. even with help how the office. a and Pay will the to to but a of

Certain engagement. associates it's they'll to from also smart on a I expect environment. that office basis, home returning working will start will flexible I but manage this us are in be more the going cost. and volunteer a June us to help returning increase to think help

peers XXth, by it, ranked us This very of America's recognition to talent. award, in all we diversity like one Diversity Best were our and the compete Employers and for we provide the front, Forbes above many well best as brand others On as recently XXXX. attract retain of

to Doug going over and the details to quarter. cover he's I'm of to Now turn going Doug? it the

Douglas Chambers

Thanks, LT. Good morning.

As this good LT to year. we're off mentioned, start a

which depressed and of as that on bolstered versus Slide this increase increased switcher and the due switcher year March activity switch handset payments. severely year pandemic a capture last stimulus group portion gross our by results by was unfolding to driven larger with of customer of activity, review result last a a higher ability year to The start this primarily additions starting was Postpaid Let's X. year. group was

gross due the attract year-over-year in no hotspots the to COVID-XX. primarily switchers router lead in connected increase an hotspot offerings. The additions year ability This compared and in and gross was promotional and routers additions. success as declines Internet to due by by such to was gross We saw we year-over-year. an requirements prior sales device our by additions partially experienced products increased where of driven of messaging Our X,XXX connected lower decrease to increase offset demand watch

over months. about by the and past higher that of ARPU. XX,XXX Wrapping $XX quarter up smartphone feature helps course given the is this XX,XXX service more phone XX revenue, the increased That to ARPU total than by drive slide, during connections smartphone

comment better Slide was a year churn X.XX%, a customer lower involuntary to ago. connected churn ago. blue mix continues run down year-over-year depicted This churn, want as Total and to on continues on the postpaid bars, lower at and and by handset the I shown lower handsets to was first behavior. churn run was result Postpaid with a on Next, due improved X.XX% low levels. of both devices rate which the handsets XXXX, year from X. postpaid Currently, also quarter for having combining connected customers credit a than devices churn, X.XX% acquired of to payment

operating Inbound a decrease which the by well Total revenue $XXX discuss increased million. driven postpaid were volume. was of revenues increase first by That as or subscribers. a as billion, Now $XX in X. revenue results a year-over-year, per let's increase decrease million. was in The roaming Retail of million million $X average year-over-year. revenues Slide turn is to data for $XX $XX a financial in higher moment primarily will I to user, service the increase to on an quarter X% average due $X.XXX million an

were factors to to traffic revenues. roaming of contributed increase volume an Sprint the T-Mobile's the including network. T-Mobile million, in decrease is rental increase this tower a revenues of of $XX migration merger Other data the $X and year-over-year, million of service Sprint One and X%

sold Finally, year-over-year as result sales units higher $XX an due in well as a units an as increased to sales increase increase revenues in of volume. by higher-priced of equipment increase in sales million accessory and

$X.XX by a per Now X% a increases for $X.XX an revenues, per mix in quarter, X% increase few or the and more basis, approximately regulatory $XX.XX Slide or protection and increase up comments about user plan revenues. account revenue grew average first year-over-year. connection year-over-year. on was an offering XX. revenue or primarily Average in favorable product were postpaid revenue On recovery driven by device The shown

XX. Slide to Turning

evolution. add multiyear network XG and By remains maintain rollout, we and towers, of make we towers our is operational sites costs, new very important. our to changes As we the our technology our cell ensure to owning flexibility equipment our current very control without additional important, incurring given continue particularly modernization which other

our of tower marketing with third-party As this steady revenues. we see you the in seen can growth slide, on assistance agreement, have rental

rental with Wireless, noted continue these year-over-year. agreement revenues increased by growing the I focus X% and signed strategic to tower master LT revenues for we As lease will new earlier quarter on mentioned, first we assets. DISH

XX. Slide accretion comment as things operating depreciation, I'll simple, and adjusted I on and to losses. to income Moving income. gains adjusted before refer operating to amortization want measure this keep To and

As income an the the of of shown slide, increase at operating bottom was year-over-year. million, $XXX adjusted XX%

earlier, As billion, $X.XXX revenues I a operating increase total were commented X% year-over-year.

were million, cash or $XXX expense Total X% year-over-year. Total $XX expenses system X% increasing million operations year-over-year. increased

to offset off-net roaming Excluding increase certain increased costs. year-over-year, largely increased by by million due sales expense expense, as in higher-priced resulting expense units higher volume Cost an in XX% an higher $X accessory X% operations sold X% to system rates. Roaming from equipment volume. was or due sold, that data well as or in in increase sales increase decrease increased a smartphones $XX year-over-year of million an XX% of

$XX Selling, write-offs result administrative of Bad debts general driven expenses by decrease by as credit fewer customer expense. bad driven customers due X% million decreased and payment decreased better behavior. nonpaid million in and primarily a debts to mix $XX lower improved a year-over-year, or expense

recorded the year-over-year the which bad in Pledge, expense debts to the quarter Keep Connected to of Americans related first also We XXXX contributed decrease. FCC

expense year-over-year. addition, In decreased advertising

increase entities I'll from million $XXX for with XX. with of investments equity $X X%. Adjusted to touch and the or was X% which million, and EBITDA, Turning interest by starts $XX million incorporates income Slide Equity EBITDA and method unconsolidated decreased of an year-over-year. earnings adjusted quarter adjusted or income. on along dividend the operating our earnings

Next, I XXXX. our want guidance full for to cover year the

For comparison, we're showing our XXXX actual results.

COVID-XX cause that does impact incremental assumes economic guidance significant consequences not negatively our that any Our would business.

revenues, miscellaneous an service a $X.XX increased service range by midpoint increase revenues. total for This our build of in our increase $XX driven have million to by $X.XX and billion. For we is billion to projections revenues

with of our income and have EBITDA million end ranges new adjusted ranges the the We change $XXX the $XXX to increasing range to billion of no million ranges, in to and low respectively. midpoint raised $XX by adjusted of end the the $X.XXX operating million $X.XXX by high resulting of billion,

offset the the to an to This projections favorability in for revenues, ranges incorporate and the addition marketing expenses. bad increase loss earlier on favorability In of expected in projections. and is updated our service our debts the partially increase compared selling for remainder by in year equipment

and capital category. turn $XXX major we Vicki? to range are For provided Villacrez. we expenditures, by over maintaining guidance the our have breakdown of will now million to I call $XXX million, Vicki a

Vicki Villacrez

top Doug, grew first consecutive our for very continue Overall, growth pleased in total for and on service and revenue. fiber footprint strong line third We I'm morning, the organic our our addresses fiber connections everyone. with good to added connections we the we had X%. Overall, broadband Thanks, quarter. strategy. quarter. XX,XXX our execute results We to and grew both

change and of operations. As reporting in cable segment wireline results presentation Pete our X referenced to a earlier, combined the

trajectory We providing video to the have service common superior voice bundling. of around service our with a been businesses complementing integrate and and on value-added broadband that strategy

service offer we Whether basis, our able to it copper provided fiber better X-gigabyte Internet DOCSIS committed combined markets XX% increase we strategic is On for we've total striving X.X to customers. invested years. building to addresses. our been to are upgraded in our remain speeds several a serve have or are capability, of to or priorities our we where speeds We

by objective strategic to in services. broadband investing is high-speed growth Our our primary provide

and FCC's existing program our With A-CAM in support broadband also high-speed constructing this grants, growth a market. broadband to deploying and in includes is opportunistic fiber TDS Telecom greenfield within the incumbent to leveraging have We from our rural state networks customers locations. that multifaceted approach areas

in Total XX% grew earnings turn increased you by broadband of and network in If fortify a into to X% broadband increased residential X% by wireline partially the cable voice to X%. and to Slide markets, decrease new and growth in residential connections our this Bolstered continue connections. connections offset total as with broadband XX fiber expand grew new existing telecom residential quarter presentation, growth, residential we connections markets. the due

continue Cable higher penetration in drove Overall, revenue connections to residential X% points higher to revenue per wireline. XX%. residential a and broadband value Total per basis average price product reflects video a XXX increases increase increase, average of mix up connection. relative to connection mix

connection Our growth. investment in drive expansion TDS video will our TV+ into new markets and

markets. the XX, across connection growth Slide all see broadband On you can

This milestone, revenue quarter, major in million we Residential in total the quarter. subscribers. reaching grew a total X.X achieved XX% broadband broadband

markets. broadband an areas fiber In taking seeing us is service, We are markets. superior X.X our that new DOCSIS X-gigabyte in offer XX% markets we and customers to are and to allows both over offering new we X-gig defend our product. up win The product customers of tool in X-gigabyte important where speeds this

Now turning to Slide XX.

broadband our growing We our augmented success, TV+ have TDS with offering.

enhances platform reduce continues increase help important video best-in-class viewing and the market these Video our market. a in growth service bundle, driven nearly as to customers. by churn. expansion customer experience next-generation Wireline to the markets, losses offset of to held flat. nearly X%, connections provided broadband cable Our products us and remain video and, our customer Residential our share

currently our offering Our of the XX% operations. connections TV+ covers our video rollout product. total about to This TDS strategy cloud-based this our is through of increase product of

bullish We markets experience. deliver Fiber solution shown our the funnel continue on identified. attractive XX. right fiber the markets the of is long-term and Selecting strategy, an to best on Slide to we have broadband is key economical which be most remains

ranking This markets. is Journal. Coeur country's In the emerging according Washington list to topped Spokane, d'Alene, Idaho the and Street recent housing Wall the fact, by hottest the of

tremendous neighborhood timing us and at high effectively target consistently market to a a broadband flexibility take us execution This gives Our over marketing to rate. enable level. and sales techniques

Our cluster gives scale market strategy of better it and is our returns critical time. economies to as us over

trends environment, as for work-at-home advances funding. broadband strong population markets, migration on in technology rural and in chosen capitalizes our Additionally, favorable strategy support growing bipartisan strong such macroeconomic our

fiber our shows expansion new are progress also the this on includes into we multiyear footprint XX into fiber year markets. Slide and markets which making incumbent expansion,

or wireline of now our expanding from the addresses year while addresses. fiber, strategy wireline XXX,XXX This by revenue over service served is up which also result XX% XXX,XXX a XX% driving several the ago. last a to total are service years, As growth this is footprint X% of

Slide for the total and Moving We've clusters the in actively service XX. are marketing. that are highlighted addresses on construction we to

XXX,XXX service We and have the quarter to XXXX. fiber XXX,XXX completed in working build out addresses the these by service announced are through first to markets addresses footprint

other these have these We the be will markets in future, opportunities we identified near expect first market our increase numbers. plant and attractive which flag can where to to in

to continue launched with We the we to pleased take date. overall be in rate have areas

we demand Our trying rate, higher when indicates expectations. the construction high preregistration are completed. we a have satisfy, is And to even which than very are rate our conversion

We to from delivery expecting our up prior address are fiber XXXX double are service the and year. scaling in

X% total On X% offset market. Incumbent chart residential highlights $XXX of decrease by which due increased was in partially strong in revenue the includes as connections. growth connections and wireline markets video our the broadband in also the growth from a broadband residential voice contribution increases X% of largely mix. X% within increasing revenues, This showed driven product by well to to which Slide as million, The impressive revenues XX, total. increased expansion residential in mix, increases

impacted $XX in broadband Cable And market. decreased incumbent $XX wireline to in in to to reductions be due to revenues, quarter. increase which CLEC continue to million wholesale residential the primarily declines, million X% special in the access Commercial an due revenues grew X% decreased X% X% revenues by connections.

cable our The increased and So growth declines as quarter our our shown X% advertising the legacy results me to combined business. expense the exceeded financial fiber on X% expansion prior Cash from we market. as Slide sum subscribers in expenses employee expansions to for increased increases let experienced up. XX. in related Revenues the additional year due from and broadband

investments and information support to increases We programming systems. are simplify consolidate where video processing in we saw and costs expenses, making also our IT

declined we spend compared Capital to million interest Adjusted lower EBITDA year increase as last fiber installs. success-based expenditures on $XX X% from year. last new for to continue to deployment and $XX in million increased customer income our investment to XX%

moving And XX. finally, Slide to

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

our strong We all per growth have of increased combined residential had operation, average connection connection. revenue across broadband with markets

portions We through service continue of continue new may delivery that the build advancement fiber as our schedule. markets, stay parties, to which third impact have address will move of fiber deployment our year. very our on I in depend to on ability rapid but the aggressive we update you we our

their that, I all associates with want And challenging to our agenda. thank for to growth our continued dedication

year We with the have and start back forward now turn updating had to look to a second And the Jane. I'll you successful the on that, over quarter. to call you,

Jane W. McCahon

operator, And take ready questions. Vicki. to we're Thanks,

Operator

Instructions] [Operator

first Your question Raymond James. comes from Prentiss from Rick

Ric Prentiss

rating to guidances. first in think the that, run At Cellular, want flat. low at as the increased a I kept U.S. high about but And quarter. obviously, strong the end the end came take in we look

I on maybe you're higher promotions. equipment think expecting you Doug, mentioned loss

positive good you able postpaid future So service achieve as is be environment, kind rate phone that, with to through quarters of a at year? for think the in and the adds competitive run you you'll And do level? think process maybe

Douglas Chambers

Yes.

third our with rate as run the maintenance so we quarter season. expenses mix. construction it bit well are end revenues And rate little and with resulting year. second as peaks in also expenses back-end revenues to the to mentioned revenue heavy in some and operations have towards we and the in a guidance, of with From the marketing some loaded and took of rate and perspective, a reasons selling out respect increase, run it plan call, we and And miscellaneous regulatory favorability the the service

year So quite look at uniform the run not the that. we is throughout rate when

market the think that specifically certainly we've comments. we we in don't guidance I on again, are With stated to growing so -- with subscribers, subscribers, the said sub guide but increase the very respect -- well -- And it focused growing in we for our as base. share we as the to reasons

the question that answer to think I So is yes.

Ric Prentiss

guidance similar for $XX be wouldn't the question towards of of Strong high headed far Okay. side, Vicki, as And TDS then. you should as we What end the adjusted marketing on sales quarter, or service there some EBITDA. why million think cost trends increases just and is assume markets. I that of as why roll up? go the guidance out you TDS more wondering, on Telecom. couldn't But

Vicki Villacrez

Thank our it's Yes. you some question. a headroom Very strong -- and with year. on certainly quarter. quarter have did pleased that us for the We has where And given we're headed. start the strong

know, up our through in up you within to As markets. that's expansion in and our fiber incumbent ramping construction we're going ramp the our And deployment, both new year. market

And launches I going new to of costs to are these day, higher revenue growth also experiencing the expect new markets. in be for come year, turning we Every of for the But upfront up with new so while with this on at staying and associated point. the that. neighborhoods. we're our come the track range And fold, well we as have into costs hitting guidance within we're these

Ric Prentiss

then on, would last following And be chain. supply question

this at from it year, from seem Cellular, does the the supply But chain be just their U.S. We've network of concerns supplies? side, both On out handset about network it the know other the TDS on addresses LG supply tough. get any U.S. XXX,XXX business. Cellular on the skittish might being chain. from Telecom, Any I calls, talked heard and a added on like supplies, handset service issues. side standpoint as is given conference

of Just talk to kind that.

Laurent Therivel

chain Rick, you I paying Two to. the side it's ones X is big first. on LT. think drivers mentioned, attention they're we're supply LG that the that the

business most prepared the LG robust are the sales -- we've for side not in ecosystem, a We fairly got concern does of prepaid device so our Mostly, that. that are LG well of and me.

I demand we're serve well out there. the prepared that's that think can we

I'm concerned skittish, of more a attention that are But it. side we certainly. I if thus manage far. lot the I I'm far, business can think a If one, there attention would lot pay our sure the Thus to. on use Chipset I'm impacts, not seeing to. word of we paying house, not but effects

So couldn't the kind infrastructure not want we're to closely set? -- it if but that impact, start far, at. telecom no of we ramp looking you up. say that's more one, that to that answer see Vicki, Thus to

Vicki Villacrez

think diversified biggest Yes, sure. and we've we're having I advance. longer. of be it's the touch our more therefore, getting see suppliers constant And watching those We've have And in we been our chain some in made with in needs suppliers. But in sense. choices supply of carefully, the our where helps. and very to many lead now, I right our the risk further much sourcing is forecasting product And our are times diligent cases,

Not fiber so We're capital spend go towards watching. of inventory. starts with yet the And some definitely build. we're but to the sensitive availability our building and to something up significant of electronics associated gear that's

in drives, modems. connectors, heads, about modems, ONTs, are chipsets the thinking You're

And we're times. longer the areas where seeing kind of so are these lead

with suppliers with Thus with longer that had our important. really issues haven't far, our so sourcing secure And a fiber, we partnership and we inventory is time. do any lead

large part service not we're addresses. service but the that second first full delivering year double looking your up XX,XXX scale And up. on are XXX,XXX delivered obstacles, These we down projects. about of think ramp without really and quarter, in which I complex, to as is expect to our your we addresses the challenges of Now construction question, but or is

contracting in the And to out those as flags and planting so critical. working think markets, also suppliers And the a fiber we our the is contractors labor securing continues be and about sourcing. critical of component with new building for

Operator

Cusick Your question Phil from next from comes JPMorgan.

Philip Cusick

A couple if I can.

involuntary low. they leave? you sort discounts. First, where all are promotions is on that in I particular, LT, heard Are you and churn world talked at about remains as market going the reopens? of handset up when And ticking any shifting involuntary, churn then to low going you the customers seeing

Laurent Therivel

you but where second churn, not bit what switcher line I shift pool. there's question no, start to involuntary in is a a larger would see to expect with when you big they're upticks, the Slight completely in Answer think going. little of a

it port has publish share remained our don't our to generally win we the but So share different our -- constant. loss ratios carriers and and

there. not So big shift a

Philip Cusick

No cable more with little a more sort impact up bit aggressive from of in getting these T-Mobile markets? showing

Laurent Therivel

it suggesting X seeing thus mean, seeing not that not not of incremental there's yet. I'm far, I it. impact, I mean, We're in impact. we're terms But

Philip Cusick

this for then, And that fiber I the have you done addresses will last. year new lately, what heard of say double us versus Vicki, under you Okay. categories

that I think, the construction fiber footprint? you said. LEC that some of of Can areas attractive of telcos any you sign accelerate further? incumbent the in building XXX,XXX you And find outside

Vicki Villacrez

Yes.

on -- very scaling shows that last last year, And think, question. over the constructed year, doubled So is We're definitely number fiber Doubling more I the year's. the organization up prior our of locations up. our we great scaling focused fiber operations. than

focused very are accelerate can we builds. we these on how go can how we So faster, much

real and pushing as of But our And with we into that from next the build. it's way and then take we city the the into construction there's city run -- that And we we're need learning frankly, different we're own them throughout we're always going cities our and partnership, a support partnership officials, and suppliers in, the to with and And those we course, those. challenges teams. the way. the quite building our the our contractors learning put learnings through be obstacles

to are over good and and significant headstart. We've accelerate long -- own telcos and been X/X up we just for our overbuilt we I the now this competitors. of or got our think We've very learned footprint focus time. fiber. of other fibered our headstart strategy, feel program that we're got And terms in from that. confident In to ILEC we've a we've a continuing starting question own just fiber on around markets our the deploying a were We doing

Operator

from question comes Flannery Simon next from Stanley. Morgan Your

Simon Flannery

here. maybe that good about initiatives of on the a you LT, Obviously, some industry programs see full the little some we'll these do thoughts us a When and through you we year? growth. in think we'll of rollout through what's this to do of these benefits total seen adds And of in go progress as the are coming driving talked think the focus impact. new results? the more you the any we the just on Give we've see But on where sense quarter.

I level, be great. checks think stimulus would one you mentioned but other any thoughts on

from thoughts on opportunity for And thoughts and about is there? then, the great. -- would funding municipalities you and be some bill TDS broadband others, Vicki, how Any think there infrastructure perhaps

Laurent Therivel

Simon, on terms just each of and I growth -- an of these. I would of drivers, one kind update X pointed in give you let bit a me of

in different So approach. taking Frankly, previous a of as part a we or doing ones regional on started basis regionalization it think on about different doing so talked promotional regional a de-testing calls and regions. of it's that, trialing working. started I activity We've was the and

We think which ones down which quickly traffic. we're able drive don't, resonate, hone on to promotions which pretty

would be. perspective, And what working our a from regional that, I postpaid, nicely. And It's so I think can where we're of expect from one is results a it see some doing postpaid that to you in the perspective.

talked prepaid. about We

in going prepaid to on and up out them the they we'd when of around results note that's focus rest we'd to was quarter, You're greater out a they reach were of customers pick focus see pretty note talked the cycle the initial send a send The management. customer. already eligibility, irregular when life some note them them initially, about, year. for I would in of network. We'd sense send we when a they a longer no joined our that of in the our the this prepaid and results to expect I starting the run

more to churn. often, prepaid out the down us our opportunity active starting gives customers much bring around become and more to to reaching We're that

gives that you when have goes you expanded to ARPU. you have churn also down an that and results, allows do see an it us expand acquisition you in You opportunity ARPU, perspective. can to aggressive And the more the what get from

I'm perspective. a prepaid So we're from with comfortable where at

Business and progress. in comfortable still place. But what in is work initiative. put a with this longer-term I'm government is we a

So we from hired who's [indiscernible] [indiscernible] Sprint.

channels. expanding really a initiatives place of think I she's lot done good around in

time a to indirect value-added bit agents. going be probably things expect on started And partnering with you'll partnering the more to that, that's picking Those resellers, we and with aggressive So get take up. I and more side, next sector. in see seeing than activity to early this it terms bit would the time and I longer to. It business results late a lead year, a increase of from has government master in start expect

increase one about partnerships. that I'd And is in the talked final

does of And "Okay, the a you mean already means, give you've that's aggressive LA. so partnership idea can't partnerships I on kind impact to nice, what more get seen more a aggressive about LT. with to then an And the that in be What to just taking the us approach details DISH it the from into itself, of contract perspective?" but

become right? things a well Sommer at portfolio are that. secret, development towers, people we've Austin can things, to the co-location other access has come is [ one been interested our that got partner as rate than how And hired the as more No industry we've fix we business attractive strategy. ] lower of to run average getting roaming, to and and We to that our that in looked

do While tactical applications, processing cycle time to last could down bring are months. the there's things X over we've times down can done fairly attractive that that are you make considerably and more that. yourself your Cycle

that thing we our a look towers. the policies took we The in just some did at of is

expansion. economics the center the did and and said, that is [ expand got reserve with shelters we we've pretty space make towers with form willing could data we it. our space a So for generators thing tower potential that partners overall partners. The sense. if bit so we assets capacity the We a would those amount that of down in backhaul, still of at available share network and of in our amount we're to significant or look, a past, the brought We're ] reserving we right, little

actions. And so we've those taken

the more. of I fruit first think I deal the and actions expect DISH see is to those bearing example

that hopefully, the those fruit, next. continue and going a to I'm about So certainly expect gives bear efforts of growth particularly from encouraged. I throughout you some year we're flavor doing into to this see rest how perspective.

it to you want over let other the for hand to me Vicki, question.

Vicki Villacrez

Sure.

On the still summary infrastructure the think information, proposal, are we're watching forthcoming. this as it details develops. the We've I but seen

it's it elements. scaled at be where process. expect I think bit. ends But broadband up I total critics The to may but survive at going is to now right early on watching speculate TDS its Telecom, too the definitely growth we're sure, likely think how a taking build back I further portion not spending the are aim specifically to the but development. I'm different drive

out government support, know, standing from that And program. the economics to have would FCC's level more program, back, to under work that But you of participating. that. right year as funding remote additional now. that areas obligation location history the build in without And under do long from be we're make able And programs, active, build right for very not now, fifth to A-CAM have just And we of the to of that we're half in of program. we XXX,XXX we we're currently we as building work a the the

build term. about adoption we're even But also of the growth with program broadband that of and we're extending the higher extending the FCC that And about acceleration to adoption and longer maybe speeds. was seeing pandemic in to the through out speeds that star higher we're program if and speeds, and talking XX-megabit the because others on recall, active A-CAM the discussions of program you

the program, So Lifeline in FCC's -- also participating and state broadband programs, broadband we're EBB.

And participation -- evaluating We're Rescue also Plan. that. the American so in and

opportunities we So forward. play are and that we can lots in move of as update you

Operator

Michael from Citi. comes Rollins question Your from

Michael Rollins

LT, back you're making to go to want comments, partnerships. I the about

strategic also Just the considering industry. curious if with alternative relationships you're

an look there your help you the competitive to competition in improve is markets, your at to markets structure be and longer-term that the positioning? of able If to direction opportunity of just

Laurent Therivel

creative best going the past customers, most variety C-band, to different was about Mike. way to the incumbent return an you spent money improve spectrum, on to fairly even think capital-efficient And for deploy look on capital. in to we're that it's on I've deploying clear answer calls us that, money and amount think our that's the in Simple think if the customers industry C-band experiences the ways interested better that that amount way speeds of in our way. yes, of I is C-band, that I on at been as to a of better we be that upon we required the about us the the industry getting be think best on serve

simple And take happen answer don't These certainly of but right? We're options. so evaluating looking time. those They is overnight, that's things we're at. just a lot yes, the something

Operator

from comes Dluzhevskiy question next Sergey GAMCO from Your Investors.

Sergey Dluzhevskiy

of background with lease bit as far talk could you that to our companies. limited companies any maybe conversations Obviously, deal, the types What you're as and about point? other players little general, are question guys about Wireless, in you of is with are this talk that just, Are And But it's it agreement I first talking that My how DISH for LT. to talking got there great other nontraditional see lease potential also a say. you to? agreements? maybe understand could about you what

Laurent Therivel

we our tried open mean, assets. deal can I'm as think to fairly But business I tower broadly, share. how that on just for about. limited mean, mean, were I that as came what make so Sergey, obviously, we far fairly the I I I clear Yes. it

attractive that think value we proposition. I have relatively a

of a set And tower about Verizon mean, different think my have wireless and So competitors. business, obviously, traditional I AT&T, the business from competitors, perspective, I a T-Mobile.

And so differently. a I those think bit vis-à-vis little proposition about our competitors value

I think the talked of that provide opportunity generators times, share better to we've of so also got and that. assets think some levels have can about service, on of in a that I our of the we customer we shelters can't. faster competitors cycle form and set

our want. approach we're some trying towers, wireless do. think I as customer-friendly I I'm a frankly, competitors don't customer understand my customers that of what operator, And and a always And of to take that a also fairly

to I fully as DISH. expect I to And so resonate proposition pretty others a with put going resonated clearly, with you think we're good And that able proposition, that's all value together, offer that value well. that, and

we're fairly assets. mean I actively marketing those

cash a flow. dollars positive in line help and marketing the bottom We that. have And of to They expect drop a for time. firm us to potential do the right that customers, with job beating bushes to go partnership pretty a good the form up rates I those over co-location those with are

So pushing. about to business that and going I'm optimistic keep we're

Sergey Dluzhevskiy

Great. builds. become growth similar tower sister it the growth increase business helping your company, a maybe fiber TDS has revenue Telecom with question, enhancing on And on valuation a the profile and tower improved running profile Cellular, profitability for potentially a vehicle like related meaningfully And U.S. stocks. multiple company, more and its through potentially

Laurent Therivel

mean of the for strategic in investing I terms we're I reason opportunity mean I a the agree. in that's this. tower business,

growth. flow driver I of more vehicle perspective, for think us. argue the right? importantly an perspective, cash can From attractive a It's I growth it from be attractive would revenue an for

talked that's company the past interested we're -- I doing. we've separate in that something kind mean, I not we in and the question covered think of about

operational synergies see lot provides thing is, benefits as provide organization. we and I looked us. our they past, network think of in it the at we the one-sided, interesting benefit to those own operational synergies a towers The primarily we in meaning really

that differentially. that you we're continue about on a but I tower can benefit I can And to asset. your that upside being network expect you provide What see us uses to there's realizing is that business. side push both another benefit customers the sides towers, think that those company in already talked of to there's

Sergey Dluzhevskiy

My Great. question for next Pete. is

into were at market, But both some Cellular quarter, is in one broadband U.S. around which buybacks stake EBITDA, this or transforming the you consistent buybacks other X.Xx growing repurchase your TDS. so cable if fiber, objectives? is minor there TDS buyback still allocation marks could implied your and balancing business cellular of capital and do level where still guys maybe a So to Telecom, more trading, more multiple a isn't meaningful at while why a

Peter Sereda

saw about shareholders to Vicki talking we that went Sergey, way. the and balance I'm out powder dividend. all we things talking question. And forget that perpetual LT some a about the the dry securities. and the quarter capital the preferred and between rating agency-friendly through this and about both returning the trying thanks raised to dividend share that you in we're those our in Don't to repurchase. in been have the cash about, having invest talked today past, maintain for We've

the So It's rating important long-term is enterprise. TDS. very of our sustainability part to the of

been have ramp Vicki funnel again, discussed, maintain. here. And that the investments it's -- significant And about we those investments, got just to so the a fiber make we've balance that we to have funds talking funnel to up all we've has make that sure the the that as we that

continue never to maintaining going look but you, that balance. will balance. can And probably that we're satisfy as to at So we'll do much it as we

Sergey Dluzhevskiy

question competitive last kind is on fiber the my the And for of the markets. Vicki, Great. environment in expansion particularly in markets,

markets. expansion those players? nice in the broadband aggressive far seeing from so seen some growth And incumbent I those markets? you kind And certainly You're response competitive of wondering, in connection was of has what anyone have gotten particularly

Vicki Villacrez

Right competitive Sergey. a number One, has for now, cable now, of company. And been response levels minimal right response the I'm at watching things. it's from

expect network, with we're they've down to, with company. both into market their upgraded road the if frankly, incumbent offer and X-gig these to to the quite fiber expansion, we new offer speeds. share even What cable we're aiming, speeds multi-gig As markets we the able go

ILEC incumbent company, we've them. the from seen most not response or for The any part, competitive the significant telephone

construction. talking our are have we companies And get in some about deployment we know we sign-ups, I the market there, finish our preregistration in in markets, get plans, with -- significant first but early Now months. XX these fiber now share we

is strategy very working well. that So

opportunity us that's or of eyes right market we watch There's the to we for, is into in I fiber thing a the our overbuilders, set they're that's whether that they're -- on. think other third U.S. certainly, lot And same biggest coming market focus. new now, a The have overbuild the -- beating

is our fiber first getting attractive looking we're funnel is market to wide. markets, most as I at And funnel, thinks our Our key.

Operator

There's over I now like would no further the time. to turn this remarks. at for Jane closing to questions back call

Jane W. McCahon

updates. look like we I'd us thank today, for further and everybody to joining forward to

Operator

gentlemen, this for participating. call. and Ladies concludes Thank you today's conference

may You disconnect. now

United States Cellular (USM) 7 May 212021 Q1 Earnings call transcript