Fri, Aug 2, 12:05 PM (88 days ago)
United States Cellular Corporation (UScellular) reported a strategic shift in its operations for Q2 2024, disaggregating into two segments: Wireless and Towers, due to the planned sale of its wireless operations and select spectrum assets to T-Mobile for $4.4 billion. The transaction, expected to close by mid-2025, is subject to regulatory approvals. Q2 2024 financial highlights include: - Total operating revenues decreased by 3% YoY to $927 million. - Operating income rose to $36 million from $34 million, driven by cost reductions. - Adjusted EBITDA increased by 14% to $227 million. - Net income attributable to shareholders was $17 million, up from $5 million. Wireless segment revenues fell by 3% to $902 million, with a 2% decline in service revenues due to lower average connections, despite higher ARPU. Equipment sales also dropped by 6%. Cost reductions in system operations and equipment sales contributed to a 5% rise in operating income to $17 million. Tower segment revenues grew by 3% to $58 million, with operating income up 7% to $19 million. Liquidity remains strong with $748 million in undrawn borrowing capacity. Capital expenditures are forecasted between $550 million and $650 million for 2024, focusing on 5G deployment. The strategic alternatives review is ongoing, with $21 million incurred in related expenses YTD. Future impacts include potential revenue shifts post-transaction and uncertainties in operational expenses.