Document And Entity Information
Document And Entity Information | 3 Months Ended |
Mar. 31, 2021shares | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Mar. 31, 2021 |
Document Transition Report | false |
Entity File Number | 001-14157 |
Entity Registrant Name | TELEPHONE AND DATA SYSTEMS, INC. |
Entity Central Index Key | 0001051512 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2021 |
Document Fiscal Period Focus | Q1 |
Amendment Flag | false |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 36-2669023 |
Entity Address, Address Line One | 30 North LaSalle Street, Suite 4000 |
Entity Address, City or Town | Chicago |
Entity Address, State or Province | IL |
Entity Address, Postal Zip Code | 60602 |
City Area Code | (312) |
Local Phone Number | 630-1900 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Smaller Reporting Company | false |
Emerging Growth Company | false |
Entity Shell Company | false |
Common Shares | |
Title of 12(b) Security | Common Shares, $.01 par value |
Trading Symbol | TDS |
Security Exchange Name | NYSE |
Entity Common Stock, Shares Outstanding | 107,093,000 |
Depository Shares each representing a 1/1000th interest in a share of 6.625% Series UU Cumulative Redeemable Perpetual Preferred Stock, $.01 par value | |
Title of 12(b) Security | Depository Shares each representing a 1/1000th interest in a share of 6.625% Series UU Cumulative Redeemable Perpetual Preferred Stock, $.01 par value |
Trading Symbol | TDSPrU |
Security Exchange Name | NYSE |
6.625% Senior Notes | |
Title of 12(b) Security | 6.625% Senior Notes due 2045 |
Trading Symbol | TDI |
Security Exchange Name | NYSE |
6.875% Senior Notes | |
Title of 12(b) Security | 6.875% Senior Notes due 2059 |
Trading Symbol | TDE |
Security Exchange Name | NYSE |
7.0% Senior Notes | |
Title of 12(b) Security | 7.000% Senior Notes due 2060 |
Trading Symbol | TDJ |
Security Exchange Name | NYSE |
5.875% Senior Notes | |
Title of 12(b) Security | 5.875% Senior Notes due 2061 |
Trading Symbol | TDA |
Security Exchange Name | NYSE |
Series A Common Shares | |
Entity Common Stock, Shares Outstanding | 7,293,000 |
Consolidated Statement of Opera
Consolidated Statement of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating revenues | ||
Total operating revenues | $ 1,318 | $ 1,261 |
Operating expenses | ||
Selling, general and administrative | 388 | 411 |
Depreciation, amortization and accretion | 224 | 235 |
(Gain) loss on asset disposals, net | 5 | 4 |
(Gain) loss on sale of business and other exit costs, net | (1) | 0 |
Total operating expenses | 1,208 | 1,189 |
Operating income | 110 | 72 |
Investment and other income (expense) | ||
Equity in earnings of unconsolidated entities | 42 | 45 |
Interest and dividend income | 3 | 6 |
Interest expense | (53) | (37) |
Total investment and other income (expense) | (8) | 14 |
Income before income taxes | 102 | 86 |
Income tax expense | 31 | 3 |
Net income | 71 | 83 |
Less: Net income attributable to noncontrolling interests, net of tax | 12 | 14 |
Net income attributable to TDS shareholders | 59 | 69 |
TDS Preferred dividend requirement | 2 | 0 |
Net income attributable to TDS common shareholders | $ 57 | $ 69 |
Basic weighted average shares outstanding (in shares) | 114 | 115 |
Basic earnings per share attributable to TDS common shareholders (in dollars per share) | $ 0.49 | $ 0.60 |
Diluted weighted average shares outstanding (in shares) | 116 | 116 |
Diluted earnings per share attributable to TDS common shareholders (in dollars per share) | $ 0.48 | $ 0.59 |
Service | ||
Operating revenues | ||
Total operating revenues | $ 1,042 | $ 1,026 |
Operating expenses | ||
Cost of goods and services | 299 | 293 |
Equipment and product sales | ||
Operating revenues | ||
Total operating revenues | 276 | 235 |
Operating expenses | ||
Cost of goods and services | $ 293 | $ 246 |
Consolidated Statement of Compr
Consolidated Statement of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 71 | $ 83 |
Change related to retirement plan Amounts included in net periodic benefit cost for the period | ||
Amortization of prior service cost | 1 | 1 |
Comprehensive income | 72 | 84 |
Less: Net income attributable to noncontrolling interests, net of tax | 12 | 14 |
Comprehensive income attributable to TDS shareholders | $ 60 | $ 70 |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities | ||
Net income | $ 71 | $ 83 |
Add (deduct) adjustments to reconcile net income to net cash flows from operating activities | ||
Depreciation, amortization and accretion | 224 | 235 |
Bad debts expense | 8 | 34 |
Stock-based compensation expense | 10 | 11 |
Deferred income taxes, net | 27 | 75 |
Equity in earnings of unconsolidated entities | (42) | (45) |
Distributions from unconsolidated entities | 23 | 25 |
(Gain) loss on asset disposals, net | 5 | 4 |
(Gain) loss on sale of business and other exit costs, net | (1) | 0 |
Other operating activities | (1) | 0 |
Changes in assets and liabilities from operations | ||
Accounts receivable | 17 | 43 |
Equipment installment plans receivable | (18) | 23 |
Inventory | 8 | (52) |
Accounts payable | (115) | 87 |
Customer deposits and deferred revenues | 9 | (9) |
Accrued taxes | 0 | (74) |
Accrued interest | 9 | 9 |
Other assets and liabilities | (69) | (82) |
Net cash provided by operating activities | 165 | 367 |
Cash flows from investing activities | ||
Cash paid for additions to property, plant and equipment | (220) | (377) |
Cash paid for intangible assets | (1,261) | (26) |
Cash paid for investments | 0 | (1) |
Cash received from divestitures and exchanges | 1 | 0 |
Net cash used in investing activities | (1,480) | (404) |
Cash flows from financing activities | ||
Issuance of long-term debt | 567 | 50 |
Repayment of long-term debt | 0 | (2) |
Issuance of TDS Preferred Shares | 420 | 0 |
TDS Common Shares reissued for benefit plans, net of tax payments | (1) | (1) |
UScellular Common Shares reissued for benefit plans, net of tax payments | (1) | 0 |
Repurchase of TDS Common Shares | (3) | (6) |
Repurchase of UScellular Common Shares | (2) | (21) |
Dividends paid to TDS shareholders | (20) | (19) |
Payment of debt and equity issuance costs | (14) | (3) |
Distributions to noncontrolling interests | (1) | (1) |
Other financing activities | (3) | 0 |
Net cash provided by (used in) financing activities | 942 | (3) |
Net decrease in cash, cash equivalents and restricted cash | (373) | (40) |
Cash, cash equivalents and restricted cash | ||
Beginning of period | 1,452 | 474 |
End of period | $ 1,079 | $ 434 |
Consolidated Balance Sheet
Consolidated Balance Sheet - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 | |
Current assets | |||
Cash and cash equivalents | $ 1,042 | $ 1,429 | |
Short-term investments | 3 | 3 | |
Accounts receivable | |||
Customers and agents, less allowances of $60 and $67, respectively | 978 | 1,004 | |
Other, less allowances of $2 and $2, respectively | 119 | 108 | |
Inventory, net | 145 | 154 | |
Prepaid expenses | 114 | 105 | |
Income taxes receivable | 188 | 187 | |
Other current assets | 53 | 36 | |
Total current assets | 2,642 | 3,026 | |
Assets held for sale | 1 | 2 | |
Licenses | 3,924 | 2,638 | |
Goodwill | 547 | 547 | |
Other intangible assets, net of accumulated amortization of $75 and $71, respectively | 213 | 213 | |
Investments in unconsolidated entities | 497 | 477 | |
Property, plant and equipment | |||
In service and under construction | 13,742 | 13,659 | |
Less: Accumulated depreciation and amortization | 9,791 | 9,687 | |
Property, plant and equipment, net | 3,951 | 3,972 | |
Operating lease right-of-use assets | 1,005 | 998 | |
Other assets and deferred charges | 627 | 652 | |
Total assets | [1] | 13,407 | 12,525 |
Current liabilities | |||
Current portion of long-term debt | 6 | 5 | |
Accounts payable | 360 | 508 | |
Customer deposits and deferred revenues | 202 | 193 | |
Accrued interest | 25 | 16 | |
Accrued taxes | 67 | 69 | |
Accrued compensation | 73 | 132 | |
Short-term operating lease liabilities | 134 | 129 | |
Other current liabilities | 96 | 101 | |
Total current liabilities | 963 | 1,153 | |
Liabilities held for sale | 0 | 1 | |
Deferred liabilities and credits | |||
Deferred income tax liability, net | 890 | 863 | |
Long-term operating lease liabilities | 941 | 940 | |
Other deferred liabilities and credits | 558 | 541 | |
Long-term debt, net | 3,991 | 3,424 | |
Commitments and contingencies | |||
Noncontrolling interests with redemption features | 10 | 10 | |
TDS shareholders’ equity | |||
Series A Common and Common Shares Authorized 290 shares (25 Series A Common and 265 Common Shares) Issued 133 shares (7 Series A Common and 126 Common Shares) Outstanding 114 shares (7 Series A Common and 107 Common Shares) and 115 shares (7 Series A Common and 108 Common Shares), respectively Par Value ($.01 per share) | 1 | 1 | |
Capital in excess of par value | 2,488 | 2,482 | |
Preferred Shares, par value $0.01 per share, $25,000 liquidation preference per share, .017 shares outstanding | 408 | 0 | |
Treasury shares, at cost, 19 Common Shares | (472) | (477) | |
Accumulated other comprehensive loss | (3) | (4) | |
Retained earnings | 2,830 | 2,802 | |
Total TDS shareholders' equity | 5,252 | 4,804 | |
Noncontrolling interests | 802 | 789 | |
Total equity | 6,054 | 5,593 | |
Total liabilities and equity | [1] | $ 13,407 | $ 12,525 |
[1] | The consolidated total assets as of March 31, 2021 and December 31, 2020, include assets held by consolidated variable interest entities (VIEs) of $1,244 million and $1,042 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of March 31, 2021 and December 31, 2020, include certain liabilities of consolidated VIEs of $17 million and $18 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 10 — Variable Interest Entities for additional information. |
Consolidated Balance Sheet (Par
Consolidated Balance Sheet (Parenthetical) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | |
Accounts receivable | |||
Customer and agent allowances | $ 60,000,000 | $ 67,000,000 | |
Other allowances | 2,000,000 | 2,000,000 | |
Other intangible assets | |||
Other intangible assets accumulated amortization | $ 75,000,000 | $ 71,000,000 | |
TDS shareholders’ equity | |||
Authorized shares (in shares) | 290,000,000 | 290,000,000 | |
Issued shares (in shares) | 133,000,000 | 133,000,000 | |
Outstanding shares (in shares) | 114,000,000 | 114,000,000 | |
Par value per share (in dollars per share) | $ 0.01 | $ 0.01 | |
Par value per share (in dollars per share) | $ 0.01 | ||
Liquidation preference per share (in dollars per share) | $ 25,000 | ||
Outstanding shares (in shares) | 17,000 | ||
Variable Interest Entities VIEs | |||
Total assets | [1] | $ 13,407,000,000 | $ 12,525,000,000 |
Series A Common Shares | |||
TDS shareholders’ equity | |||
Authorized shares (in shares) | 25,000,000 | 25,000,000 | |
Issued shares (in shares) | 7,000,000 | 7,000,000 | |
Outstanding shares (in shares) | 7,000,000 | 7,000,000 | |
Common Shares | |||
TDS shareholders’ equity | |||
Authorized shares (in shares) | 265,000,000 | 265,000,000 | |
Issued shares (in shares) | 126,000,000 | 126,000,000 | |
Outstanding shares (in shares) | 107,000,000 | 107,000,000 | |
Par value per share (in dollars per share) | $ 0.01 | $ 0.01 | |
Treasury shares at cost (in shares) | 19,000,000 | 19,000,000 | |
Consolidated Variable Interest Entity | |||
Variable Interest Entities VIEs | |||
Total assets | $ 1,832,000,000 | $ 1,803,000,000 | |
Total liabilities | 80,000,000 | 79,000,000 | |
Consolidated Variable Interest Entity | No recourse | |||
Variable Interest Entities VIEs | |||
Total liabilities | 17,000,000 | 18,000,000 | |
Consolidated Variable Interest Entity | Assets held | |||
Variable Interest Entities VIEs | |||
Total assets | $ 1,244,000,000 | $ 1,042,000,000 | |
[1] | The consolidated total assets as of March 31, 2021 and December 31, 2020, include assets held by consolidated variable interest entities (VIEs) of $1,244 million and $1,042 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of March 31, 2021 and December 31, 2020, include certain liabilities of consolidated VIEs of $17 million and $18 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 10 — Variable Interest Entities for additional information. |
Consolidated Statement of Chang
Consolidated Statement of Changes in Equity - USD ($) $ in Millions | Total | Series A Common and Common shares | Capital in excess of par value | Preferred Shares | Treasury shares | Accumulated other comprehensive income (loss) | Retained earnings | Total TDS shareholders' equity | Noncontrolling interests |
Beginning balance at Dec. 31, 2019 | $ 5,404 | $ 1 | $ 2,468 | $ (479) | $ (9) | $ 2,672 | $ 4,653 | $ 751 | |
Net income attributable to TDS shareholders | 69 | 69 | 69 | ||||||
Net income attributable to noncontrolling interests classified as equity | 14 | 0 | 14 | ||||||
Other comprehensive income | 1 | 1 | 1 | ||||||
TDS Common and Series A Common share dividends | (19) | (19) | (19) | ||||||
Repurchase of Common Shares | (6) | (6) | (6) | ||||||
Dividend reinvestment plan | 1 | 1 | 0 | 1 | |||||
Incentive and compensation plans | 3 | 3 | 4 | (4) | 3 | ||||
Adjust investment in subsidiaries for repurchases, issuances and other compensation plans | (17) | 18 | 18 | (35) | |||||
Distributions to noncontrolling interests | (1) | 0 | (1) | ||||||
Ending balance at Mar. 31, 2020 | 5,449 | 1 | 2,489 | (480) | (8) | 2,718 | 4,720 | 729 | |
Beginning balance at Dec. 31, 2020 | 5,593 | 1 | 2,482 | $ 0 | (477) | (4) | 2,802 | 4,804 | 789 |
Net income attributable to TDS shareholders | 59 | 59 | 59 | ||||||
Net income attributable to noncontrolling interests classified as equity | 12 | 0 | 12 | ||||||
Other comprehensive income | 1 | 1 | 1 | ||||||
TDS Common and Series A Common share dividends | (20) | (20) | (20) | ||||||
Issuance of TDS Preferred Shares, net of costs | 406 | 406 | 406 | ||||||
TDS Preferred dividend requirement | 0 | 2 | (2) | 0 | |||||
Repurchase of Common Shares | (3) | (3) | (3) | ||||||
Dividend reinvestment plan | 1 | 1 | 1 | ||||||
Incentive and compensation plans | 2 | 4 | 7 | (9) | 2 | ||||
Adjust investment in subsidiaries for repurchases, issuances and other compensation plans | 4 | 2 | 2 | 2 | |||||
Distributions to noncontrolling interests | (1) | 0 | (1) | ||||||
Ending balance at Mar. 31, 2021 | $ 6,054 | $ 1 | $ 2,488 | $ 408 | $ (472) | $ (3) | $ 2,830 | $ 5,252 | $ 802 |
Consolidated Statement of Cha_2
Consolidated Statement of Changes in Equity (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Stockholders' Equity (Parenthetical) [Abstract] | ||
TDS Common and Series A Common Share dividends (in dollars per share) | $ 0.175 | $ 0.17 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Note 1 Basis of Presentation The accounting policies of Telephone and Data Systems, Inc. (TDS) conform to accounting principles generally accepted in the United States of America (GAAP) as set forth in the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC). Unless otherwise specified, references to accounting provisions and GAAP in these notes refer to the requirements of the FASB ASC. The consolidated financial statements include the accounts of TDS and subsidiaries in which it has a controlling financial interest, including TDS’ 82%-owned subsidiary, United States Cellular Corporation (UScellular) and TDS’ wholly-owned subsidiaries, TDS Telecommunications LLC and TDS Broadband LLC (collectively, TDS Telecom). In addition, the consolidated financial statements include certain entities in which TDS has a variable interest that requires consolidation under GAAP. Intercompany accounts and transactions have been eliminated. TDS’ business segments reflected in this Quarterly Report on Form 10-Q for the period ended March 31, 2021, are UScellular and TDS Telecom. TDS’ non-reportable other business activities are presented as “Corporate, Eliminations and Other”, which includes the operations of TDS’ wholly-owned hosted and managed services (HMS) subsidiary, which operates under the OneNeck IT Solutions brand, and its wholly-owned subsidiary Suttle-Straus, Inc. (Suttle-Straus). HMS’ and Suttle-Straus’ financial results were not significant to TDS’ operations. All of TDS’ segments operate only in the United States. See Note 13 — Business Segment Information for summary financial information on each business segment. The unaudited consolidated financial statements included herein have been prepared by TDS pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, TDS believes that the disclosures included herein are adequate to make the information presented not misleading. Certain numbers included herein are rounded to millions for ease of presentation; however, certain calculated amounts and percentages are determined using the unrounded numbers. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in TDS’ Annual Report on Form 10-K (Form 10-K) for the year ended December 31, 2020. The accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal recurring items, unless otherwise disclosed) necessary for the fair statement of TDS’ financial position as of March 31, 2021 and December 31, 2020 and its results of operations, comprehensive income, cash flows and changes in equity for the three months ended March 31, 2021 and 2020. These results are not necessarily indicative of the results to be expected for the full year. TDS has not changed its significant accounting and reporting policies from those disclosed in its Form 10-K for the year ended December 31, 2020. Change in Reportable Segments During the first quarter of 2021, TDS modified its reporting segment structure to combine its Wireline and Cable segments into a single reportable segment for TDS Telecom. TDS Telecom believes this presentation better articulates its progress and performance against its strategy, which includes a focus on overall broadband growth and future fiber deployment across its markets. This change also reflects TDS Telecom's progress in aligning its organizational, operational and support structures to leverage one cost base to better support its customers across all of its markets. Prior periods have been updated to conform to this revised presentation. See Note 13 — Business Segment Information for additional information on TDS' reportable segments. Restricted Cash TDS presents restricted cash with cash and cash equivalents in the Consolidated Statement of Cash Flows. The following table provides a reconciliation of Cash and cash equivalents and restricted cash reported in the Consolidated Balance Sheet to the total of the amounts in the Consolidated Statement of Cash Flows. March 31, 2021 December 31, 2020 (Dollars in millions) Cash and cash equivalents $ 1,042 $ 1,429 Restricted cash included in Other current assets 37 23 Cash, cash equivalents and restricted cash in the statement of cash flows $ 1,079 $ 1,452 |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Note 2 Revenue Recognition Disaggregation of Revenue In the following table, TDS' revenues are disaggregated by type of service, which represents the relevant categorization of revenues for TDS' reportable segments, and timing of recognition. Service revenues are recognized over time and Equipment and product sales are point in time. Three Months Ended March 31, 2021 UScellular TDS Telecom Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 685 $ — $ — $ 685 Inbound roaming 28 — — 28 Residential — 157 — 157 Commercial — 47 — 47 Wholesale — 45 — 45 Other service 38 — 16 54 Service revenues from contracts with customers 751 248 16 1,016 Equipment and product sales 252 — 24 276 Total revenues from contracts with customers 1,003 248 40 1,292 Operating lease income 20 1 5 26 Total operating revenues $ 1,023 $ 249 $ 46 $ 1,318 Three Months Ended March 31, 2020 UScellular TDS Telecom Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 671 $ — $ — $ 671 Inbound roaming 37 — — 37 Residential — 144 — 144 Commercial — 50 — 50 Wholesale — 45 — 45 Other service 35 — 18 53 Service revenues from contracts with customers 743 239 18 1,000 Equipment and product sales 201 — 34 235 Total revenues from contracts with customers 944 240 52 1,235 Operating lease income 19 1 6 26 Total operating revenues $ 963 $ 240 $ 58 $ 1,261 Numbers may not foot due to rounding Contract Balances The following table provides balances for contract assets from contracts with customers, which are recorded in Other current assets and Other assets and deferred charges in the Consolidated Balance Sheet, and contract liabilities from contracts with customers, which are recorded in Customer deposits and deferred revenues and Other deferred liabilities and credits in the Consolidated Balance Sheet. March 31, 2021 December 31, 2020 (Dollars in millions) Contract assets $ 13 $ 13 Contract liabilities $ 230 $ 216 Revenue recognized related to contract liabilities existing at January 1, 2021 was $131 million for the three months ended March 31, 2021. Transaction price allocated to the remaining performance obligations The following table includes estimated service revenues expected to be recognized related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period. These estimates represent service revenues to be recognized when services are delivered to customers pursuant to service plan contracts and under certain roaming agreements with other carriers. These estimates are based on contracts in place as of March 31, 2021 and may vary from actual results. As practical expedients, revenue related to contracts of less than one year, generally month-to-month contracts, and contracts with a fixed per-unit price and variable quantity, are excluded from these estimates. Service Revenues (Dollars in millions) Remainder of 2021 $ 330 2022 187 Thereafter 184 Total $ 701 Contract Cost Assets TDS expects that commission fees paid as a result of obtaining contracts are recoverable and therefore TDS defers and amortizes these costs. As a practical expedient, costs with an amortization period of one year or less are expensed as incurred. TDS also incurs fulfillment costs, such as installation costs, where there is an expectation that a future benefit will be realized. Deferred commission fees and fulfillment costs are amortized based on the timing of transfer of the goods or services to which the assets relate, typically the contract term. Contract cost asset balances, which are recorded in Other assets and deferred charges in the Consolidated Balance Sheet, were as follows: March 31, 2021 December 31, 2020 (Dollars in millions) Costs to obtain contracts Sales commissions $ 136 $ 139 Fulfillment costs Installation costs 11 10 Total contract cost assets $ 147 $ 149 Amortization of contract cost assets was $29 million and $31 million for the three months ended March 31, 2021 and 2020, respectively, and was included in Selling, general and administrative expenses and Cost of services expenses. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 3 Fair Value Measurements As of March 31, 2021 and December 31, 2020, TDS did not have any material financial or nonfinancial assets or liabilities that were required to be recorded at fair value in its Consolidated Balance Sheet in accordance with GAAP. The provisions of GAAP establish a fair value hierarchy that contains three levels for inputs used in fair value measurements. Level 1 inputs include quoted market prices for identical assets or liabilities in active markets. Level 2 inputs include quoted market prices for similar assets and liabilities in active markets or quoted market prices for identical assets and liabilities in inactive markets. Level 3 inputs are unobservable. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. A financial instrument’s level within the fair value hierarchy is not representative of its expected performance or its overall risk profile and, therefore, Level 3 assets are not necessarily higher risk than Level 2 assets or Level 1 assets. TDS has applied the provisions of fair value accounting for purposes of computing the fair value of financial instruments for disclosure purposes as displayed below. Level within the Fair Value Hierarchy March 31, 2021 December 31, 2020 Book Value Fair Value Book Value Fair Value (Dollars in millions) Long-term debt Retail 2 $ 2,753 $ 2,814 $ 2,753 $ 2,809 Institutional 2 535 661 535 707 Other 2 796 796 230 230 Long-term debt excludes lease obligations, the current portion of Long-term debt and debt financing costs. The fair value of “Retail” Long-term debt was estimated using market prices for TDS’ 7.0% Senior Notes, 6.875% Senior Notes, 6.625% Senior Notes and 5.875% Senior Notes, and UScellular’s 7.25% 2063 Senior Notes, 7.25% 2064 Senior Notes, 6.95% Senior Notes, 6.25% Senior Notes and 5.5% Senior Notes. TDS’ “Institutional” debt consists of UScellular’s 6.7% Senior Notes which are traded over the counter. TDS’ “Other” debt consists of senior term loan credit agreements and receivables securitization agreement. TDS estimated the fair value of its Institutional and Other debt through a discounted cash flow analysis using the interest rates or estimated yield to maturity for each borrowing, which ranged from 1.31% to 4.48% and 1.35% to 3.75% at March 31, 2021 and December 31, 2020, respectively. The fair values of Cash and cash equivalents, restricted cash and Short-term investments approximate their book values due to the short-term nature of these financial instruments. |
Equipment Installment Plans
Equipment Installment Plans | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Equipment Installment Plans | Note 4 Equipment Installment Plans UScellular sells devices to customers under equipment installment plans over a specified time period. For certain equipment installment plans, after a specified period of time or amount of payments, the customer may have the right to upgrade to a new device and have the remaining unpaid equipment installment contract balance waived, subject to certain conditions, including trading in the original device in good working condition and signing a new equipment installment contract. The following table summarizes equipment installment plan receivables. March 31, 2021 December 31, 2020 (Dollars in millions) Equipment installment plan receivables, gross $ 1,013 $ 1,007 Allowance for credit losses (72) (78) Equipment installment plan receivables, net $ 941 $ 929 Net balance presented in the Consolidated Balance Sheet as: Accounts receivable — Customers and agents (Current portion) $ 596 $ 590 Other assets and deferred charges (Non-current portion) 345 339 Equipment installment plan receivables, net $ 941 $ 929 UScellular uses various inputs, including internal data, information from credit bureaus and other sources, to evaluate the credit profiles of its customers. From this evaluation, a credit class is assigned to the customer that determines the number of eligible lines, the amount of credit available, and the down payment requirement, if any. These credit classes are grouped into four credit categories: lowest risk, lower risk, slight risk and higher risk. A customer's assigned credit class is reviewed periodically and a change is made, if appropriate. An equipment installment plan billed amount is considered past due if not paid within 30 days. The balance and aging of the equipment installment plan receivables on a gross basis by credit category were as follows: March 31, 2021 December 31, 2020 Lowest Risk Lower Risk Slight Risk Higher Risk Total Lowest Risk Lower Risk Slight Risk Higher Risk Total (Dollars in millions) Unbilled $ 826 $ 99 $ 24 $ 8 $ 957 $ 819 $ 98 $ 22 $ 9 $ 948 Billed — current 35 5 1 1 42 36 5 1 1 43 Billed — past due 7 4 2 1 14 8 5 2 1 16 Total $ 868 $ 108 $ 27 $ 10 $ 1,013 $ 863 $ 108 $ 25 $ 11 $ 1,007 The balance of the equipment installment plan receivables as of March 31, 2021 on a gross basis by year of origination were as follows: 2018 2019 2020 2021 Total (Dollars in millions) Lowest Risk $ 15 $ 202 $ 484 $ 167 $ 868 Lower Risk 1 18 61 28 108 Slight Risk 1 3 12 11 27 Higher Risk — 1 5 4 10 Total $ 17 $ 224 $ 562 $ 210 $ 1,013 Activity for the three months ended March 31, 2021 and 2020, in the allowance for credit losses for equipment installment plan receivables was as follows: March 31, 2021 March 31, 2020 (Dollars in millions) Allowance for credit losses, beginning of period $ 78 $ 84 Bad debts expense 3 25 Write-offs, net of recoveries (9) (19) Allowance for credit losses, end of period $ 72 $ 90 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 5 Income Taxes The effective tax rate on Income before income taxes for the three months ended March 31, 2021 and 2020, was 30.1% and 4.2%, respectively. The higher effective tax rate in 2021 as compared to 2020 is due primarily to the income tax benefits of the CARES Act included in the 2020 tax rate, which do not recur as benefits in the 2021 tax rate. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 6 Earnings Per Share Basic earnings per share attributable to TDS common shareholders is computed by dividing Net income attributable to TDS common shareholders by the weighted average number of Common Shares outstanding during the period. Diluted earnings per share attributable to TDS common shareholders is computed by dividing Net income attributable to TDS common shareholders by the weighted average number of Common Shares outstanding during the period adjusted to include the effects of potentially dilutive securities. Potentially dilutive securities primarily include incremental shares issuable upon the exercise of outstanding stock options and the vesting of performance and restricted stock units. The amounts used in computing basic and diluted earnings per share attributable to TDS common shareholders were as follows: Three Months Ended 2021 2020 (Dollars and shares in millions, except per share amounts) Net income attributable to TDS common shareholders used in basic earnings per share $ 57 $ 69 Adjustments to compute diluted earnings: Noncontrolling interest adjustment (1) (1) Net income attributable to TDS common shareholders used in diluted earnings per share $ 56 $ 68 Weighted average number of shares used in basic earnings per share: Common Shares 107 108 Series A Common Shares 7 7 Total 114 115 Effects of dilutive securities 2 1 Weighted average number of shares used in diluted earnings per share 116 116 Basic earnings per share attributable to TDS common shareholders $ 0.49 $ 0.60 Diluted earnings per share attributable to TDS common shareholders $ 0.48 $ 0.59 Certain Common Shares issuable upon the exercise of stock options or vesting of performance and restricted stock units were not included in weighted average diluted shares outstanding for the calculation of Diluted earnings per share attributable to TDS shareholders because their effects were antidilutive. The number of such Common Shares excluded was 4 million for both the three months ended March 31, 2021 and 2020. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Note 7 Intangible Assets Activity related to Licenses for the three months ended March 31, 2021, is presented below: Licenses (Dollars in millions) Balance at December 31, 2020 $ 2,638 Acquisitions 1,283 Capitalized interest 3 Balance at March 31, 2021 $ 3,924 In February 2021, the FCC announced by way of public notice that UScellular was the provisional winning bidder for 254 wireless spectrum licenses in the 3.7-3.98 GHz bands (Auction 107) for $1,283 million. UScellular paid $30 million of this amount in 2020 and the remainder in March 2021. Additionally, UScellular expects to capitalize costs of approximately $178 million related to the estimated relocation costs and accelerated relocation incentive payments. The wireless spectrum licenses from Auction 107 are expected to be granted by the FCC in 2021. The spectrum must be cleared by incumbent providers before UScellular can access it. UScellular does not expect to have access to this spectrum until late 2023. |
Investments In Unconsolidated E
Investments In Unconsolidated Entities | 3 Months Ended |
Mar. 31, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Unconsolidated Entities | Note 8 Investments in Unconsolidated Entities Investments in unconsolidated entities consist of amounts invested in entities in which TDS holds a noncontrolling interest. TDS’ Investments in unconsolidated entities are accounted for using either the equity method or measurement alternative method as shown in the table below. The carrying value of measurement alternative method investments represents cost minus any impairments plus or minus any observable price changes. March 31, 2021 December 31, 2020 (Dollars in millions) Equity method investments $ 475 $ 456 Measurement alternative method investments 22 21 Total investments in unconsolidated entities $ 497 $ 477 The following table, which is based on unaudited information provided in part by third parties, summarizes the combined results of operations of TDS’ equity method investments. Three Months Ended 2021 2020 (Dollars in millions) Revenues $ 1,733 $ 1,662 Operating expenses 1,280 1,166 Operating income 453 496 Other income (expense), net 12 3 Net income $ 465 $ 499 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Note 9 Debt Term Loan Agreements The following table summarizes the term loan credit agreements as of March 31, 2021: TDS UScellular (Dollars in millions) Maximum borrowing capacity $ 200 $ 300 Amount borrowed $ 200 $ 300 Amount available for use $ — $ — Borrowings under the TDS term loan bear interest at a rate of LIBOR plus 2.0%. Principal reductions are due and payable in quarterly installments of $0.5 million beginning in June 2021. The remaining unpaid balance will be due and payable in January 2027. Borrowings under the UScellular term loan bear interest at a rate of LIBOR plus 2.25%. Principal reductions are due and payable in quarterly installments of $0.75 million beginning in September 2021. The remaining unpaid balance will be due and payable in June 2027. TDS and UScellular believe that they were in compliance with all of the financial covenants and other requirements set forth in their senior term loan credit agreements as of March 31, 2021. Receivables Securitization Agreement At March 31, 2021, UScellular had a receivables securitization agreement for securitized borrowings using its equipment installment receivables for general corporate purposes. Amounts under the receivables securitization agreement may be borrowed, repaid and reborrowed from time to time until maturity in December 2022, which may be extended from time to time as specified therein. The outstanding borrowings bear interest at floating rates. In March 2021, UScellular borrowed $275 million under its receivables securitization agreement. As of March 31, 2021, UScellular has borrowed the full amount available under the receivables securitization agreement of $300 million. UScellular believes that it was in compliance with all of the financial covenants and other requirements set forth in its receivables securitization agreement as of March 31, 2021. As of March 31, 2021, the USCC Master Note Trust held $446 million of assets available to be pledged as collateral for the receivables securitization agreement. Other Long-Term Debt In April 2021, TDS announced that it will redeem its outstanding $225 million of 6.875% Senior Notes due 2059 and $300 million of 7.0% Senior Notes due 2060, and UScellular announced that it will redeem its outstanding $275 million of 7.25% Senior Notes due 2063. At time of redemption, $26 million of interest expense will be recorded related to unamortized debt issuance costs related to the notes. The notes are expected to be redeemed on May 12, 2021, at a redemption price of 100% of the principal amount, including accrued and unpaid interest to the redemption date. Revolving Credit Agreements In May 2021, TDS initiated a borrowing of $100 million under its revolving credit agreement. |
Variable Interest Entities
Variable Interest Entities | 3 Months Ended |
Mar. 31, 2021 | |
Variable Interest Entities [Abstract] | |
Variable Interest Entities | Note 10 Variable Interest Entities Consolidated VIEs TDS consolidates VIEs in which it has a controlling financial interest as defined by GAAP and is therefore deemed the primary beneficiary. TDS reviews the criteria for a controlling financial interest at the time it enters into agreements and subsequently when events warranting reconsideration occur. These VIEs have risks similar to those described in the “Risk Factors” in this Form 10-Q and TDS’ Form 10-K for the year ended December 31, 2020. UScellular formed USCC EIP LLC (Seller/Sub-Servicer), USCC Receivables Funding LLC (Transferor) and the USCC Master Note Trust (Trust), collectively the special purpose entities (SPEs), to facilitate a securitized borrowing using its equipment installment plan receivables. Under a Receivables Sale Agreement, UScellular wholly-owned, majority-owned and unconsolidated entities, collectively referred to as “affiliated entities”, transfer device equipment installment plan contracts to the Seller/Sub-Servicer. The Seller/Sub-Servicer aggregates device equipment installment plan contracts, and performs servicing, collection and all other administrative activities related to accounting for the equipment installment plan contracts. The Seller/Sub-Servicer sells the eligible equipment installment plan receivables to the Transferor, a bankruptcy remote entity, which subsequently sells the receivables to the Trust. The Trust, which is bankruptcy remote and isolated from the creditors of UScellular, will be responsible for issuing asset-backed variable funding notes (Notes), which are collateralized by the equipment installment plan receivables owned by the Trust. Given that UScellular has the power to direct the activities of these SPEs, and that these SPEs lack sufficient equity to finance their activities, UScellular is deemed to have a controlling financial interest in the SPEs and, therefore, consolidates them. All transactions with third parties (e.g., issuance of the asset-backed variable funding notes) will be accounted for as a secured borrowing due to the pledging of equipment installment plan contracts as collateral, significant continuing involvement in the transferred assets, subordinated interests of the cash flows, and continued evidence of control of the receivables. The following VIEs were formed to participate in FCC auctions of wireless spectrum licenses and to fund, establish, and provide wireless service with respect to any FCC wireless spectrum licenses won in the auctions: ▪ Advantage Spectrum, L.P. (Advantage Spectrum) and Sunshine Spectrum, Inc., the general partner of Advantage Spectrum; and ▪ King Street Wireless, L.P. (King Street Wireless) and King Street Wireless, Inc., the general partner of King Street Wireless. These particular VIEs are collectively referred to as designated entities. The power to direct the activities that most significantly impact the economic performance of these VIEs is shared. Specifically, the general partner of these VIEs has the exclusive right to manage, operate and control the limited partnerships and make all decisions to carry on the business of the partnerships. The general partner of each partnership needs the consent of the limited partner, an indirect TDS subsidiary, to sell or lease certain wireless spectrum licenses, to make certain large expenditures, admit other partners or liquidate the limited partnerships. Although the power to direct the activities of these VIEs is shared, TDS has the most significant level of exposure to the variability associated with the economic performance of the VIEs, indicating that TDS is the primary beneficiary of the VIEs. Therefore, in accordance with GAAP, these VIEs are consolidated. TDS also consolidates other VIEs that are limited partnerships that provide wireless service. A limited partnership is a variable interest entity unless the limited partners hold substantive participating rights or kick-out rights over the general partner. For certain limited partnerships, UScellular is the general partner and manages the operations. In these partnerships, the limited partners do not have substantive kick-out or participating rights and, further, such limited partners do not have the authority to remove the general partner. Therefore, these limited partnerships also are recognized as VIEs and are consolidated under the variable interest model. The following table presents the classification and balances of the consolidated VIEs’ assets and liabilities in TDS’ Consolidated Balance Sheet. March 31, 2021 December 31, 2020 (Dollars in millions) Assets Cash and cash equivalents $ 22 $ 18 Short-term investments 3 3 Accounts receivable 643 638 Inventory, net 3 3 Other current assets 34 21 Licenses 637 637 Property, plant and equipment, net 98 99 Operating lease right-of-use assets 39 37 Other assets and deferred charges 353 347 Total assets $ 1,832 $ 1,803 Liabilities Current liabilities $ 25 $ 26 Long-term operating lease liabilities 35 34 Other deferred liabilities and credits 20 19 Total liabilities $ 80 $ 79 Unconsolidated VIEs TDS manages the operations of and holds a variable interest in certain other limited partnerships, but is not the primary beneficiary of these entities and, therefore, does not consolidate them under the variable interest model. TDS’ total investment in these unconsolidated entities was $5 million at both March 31, 2021 and December 31, 2020, and is included in Investments in unconsolidated entities in TDS’ Consolidated Balance Sheet. The maximum exposure from unconsolidated VIEs is limited to the investment held by TDS in those entities. Other Related Matters TDS made contributions, loans or advances to its VIEs totaling $30 million and $69 million, during the three months ended March 31, 2021 and 2020, respectively, of which $10 million in 2021 and $55 million in 2020, are related to USCC EIP LLC as discussed above. TDS may agree to make additional capital contributions and/or advances to these or other VIEs and/or to their general partners to provide additional funding for operations or the development of wireless spectrum licenses granted in various auctions. TDS may finance such amounts with a combination of cash on hand, borrowings under its revolving credit or receivables securitization agreements and/or other long-term debt. There is no assurance that TDS will be able to obtain additional financing on commercially reasonable terms or at all to provide such financial support. The limited partnership agreement of Advantage Spectrum also provides the general partner with a put option whereby the general partner may require the limited partner, a subsidiary of UScellular, to purchase its interest in the limited partnership. The general partner’s put option related to its interest in Advantage Spectrum will be exercisable in the third quarter of 2021, and if not exercised at that time, will be exercisable in 2022. The greater of the carrying value of the general partner's investment or the value of the put option, net of any borrowings due to TDS, is recorded as Noncontrolling interests with redemption features in TDS’ Consolidated Balance Sheet. Also in accordance with GAAP, minority share of income or changes in the redemption value of the put option, net of interest accrued on the loans, are recorded as a component of Net income attributable to noncontrolling interests, net of tax, in TDS’ Consolidated Statement of Operations. |
Noncontrolling Interests
Noncontrolling Interests | 3 Months Ended |
Mar. 31, 2021 | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Change Due to Net Income Attributable to Parent and Effects of Changes, Net [Abstract] | |
Noncontrolling Interests | Note 11 Noncontrolling Interests The following schedule discloses the effects of Net income attributable to TDS shareholders and changes in TDS’ ownership interest in UScellular on TDS’ equity: Three Months Ended March 31, 2021 2020 (Dollars in millions) Net income attributable to TDS shareholders $ 59 $ 69 Transfers (to) from noncontrolling interests Change in TDS' Capital in excess of par value from UScellular's issuance of UScellular shares (3) (1) Change in TDS' Capital in excess of par value from UScellular's repurchases of UScellular shares — 13 Net transfers (to) from noncontrolling interests (3) 12 Net income attributable to TDS shareholders after transfers (to) from noncontrolling interests $ 56 $ 81 |
Shareholders' Equity
Shareholders' Equity | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Shareholders' Equity | Note 12 Shareholders' Equity Preferred Stock In March 2021, TDS issued 16,800 shares of TDS’ 6.625% Series UU Cumulative Redeemable Perpetual Preferred Stock (Preferred Shares) for $25,000 per Preferred Share, for total gross proceeds of $420 million. The Preferred Shares were issued to a depositary to facilitate the issuance of 16,800,000 depositary shares (Depositary Shares), each representing 1/1,000 th of a Preferred Share. TDS received net cash proceeds of $406 million after payment of issuance costs of $14 million. The proceeds will be used for general corporate purposes, including but not limited to, the funding of capital expenditures associated with TDS Telecom's fiber program and retirement of existing debt. Each holder of Depositary Shares is entitled to a proportional fractional interest in all rights and preferences of the Preferred Shares, including dividend, voting, redemption and liquidation rights. The Preferred Shares have no maturity or mandatory redemption date and are not redeemable at the option of the holders. Dividends on the Preferred Shares, when declared, will be payable quarterly, on a cumulative basis, beginning on June 30, 2021, at a rate equal to 6.625% per year. As of March 31, 2021, there were no dividends in arrears. The Preferred Shares rank senior to TDS’ Common Shares and junior to all of TDS’ existing and future indebtedness outstanding under the TDS’ credit facilities and unsecured senior notes. Upon voluntary or involuntary liquidation, holders of Preferred Shares are entitled to a liquidating distribution of $25,000 per Preferred Share after satisfaction of liabilities and obligations to creditors. The Preferred Shares do not have voting rights, except under limited conditions. TDS may, at its option, redeem the Preferred shares (a) in whole or in part, on or after March 31, 2026 at a redemption price of $25,000 per Preferred Share, or (b) in whole but not in part, any time prior to March 31, 2026, within 120 days after a credit rating downgrade as specified in the offering prospectus, at a redemption price of $25,500 per Preferred Share, or (c) in whole or in part, within 120 days of the occurrence of a change in control as specified in the offering prospectus, at a redemption price of $25,000 per Preferred Share, plus, in each case, all accumulated and unpaid dividends (whether or not declared) up to the redemption date. The Preferred Shares are convertible, at the option of the holder, to shares of TDS Common Shares upon a change of control as specified in the offering prospectus. The conversion right is the lesser of (a) Common Shares equal to $25,000 per Preferred Share plus any accumulated and unpaid dividends, divided by the TDS Common Stock price, or (b) 2,773.200 Common Shares for each Preferred Share, which represents one-half the conversion rate at the time of closing. In both cases, certain other adjustments and provisions may impact the conversion. |
Business Segment Information
Business Segment Information | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Business Segment Information | Note 13 Business Segment Information UScellular and TDS Telecom are billed for services they receive from TDS, consisting primarily of information processing, accounting, finance, and general management services. Such billings are based on expenses specifically identified to UScellular and TDS Telecom and on allocations of common expenses. Management believes the method used to allocate common expenses is reasonable and that all expenses and costs applicable to UScellular and TDS Telecom are reflected in the accompanying business segment information on a basis that is representative of what they would have been if UScellular and TDS Telecom operated on a stand-alone basis. During the first quarter of 2021, TDS modified its reporting segment structure to combine its Wireline and Cable segments into a single reportable segment for TDS Telecom. TDS Telecom believes this presentation better articulates its progress and performance against its strategy, which includes a focus on overall broadband growth and future fiber deployment across its markets. This change also reflects TDS Telecom's progress in aligning its organizational, operational and support structures to leverage one cost base to better support its customers across all of its markets. Prior periods have been updated to conform to this revised presentation. Financial data for TDS’ reportable segments for the three month periods ended, or as of March 31, 2021 and March 31, 2020, is as follows. See Note 1 — Basis of Presentation for additional information. Three Months Ended or as of March 31, 2021 UScellular TDS Telecom Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 771 $ 249 $ 22 $ 1,042 Equipment and product sales 252 — 24 276 Total operating revenues 1,023 249 46 1,318 Cost of services (excluding Depreciation, amortization and accretion reported below) 185 97 17 299 Cost of equipment and products 275 — 18 293 Selling, general and administrative 305 70 13 388 Depreciation, amortization and accretion 170 49 5 224 (Gain) loss on asset disposals, net 5 — — 5 (Gain) loss on sale of business and other exit costs, net (1) — — (1) Operating income (loss) 84 32 (6) 110 Equity in earnings of unconsolidated entities 42 — — 42 Interest and dividend income 2 — 1 3 Interest expense (39) 1 (15) (53) Income (loss) before income taxes 89 33 (20) 102 Income tax expense (benefit) 27 8 (4) 31 Net income (loss) 62 24 (15) 71 Add back: Depreciation, amortization and accretion 170 49 5 224 (Gain) loss on asset disposals, net 5 — — 5 (Gain) loss on sale of business and other exit costs, net (1) — — (1) Interest expense 39 (1) 15 53 Income tax expense (benefit) 27 8 (4) 31 Adjusted EBITDA 1 $ 302 $ 81 $ — $ 383 Investments in unconsolidated entities $ 455 $ 4 $ 38 $ 497 Total assets $ 10,148 $ 2,377 $ 882 $ 13,407 Capital expenditures $ 125 $ 70 $ 2 $ 197 Three Months Ended or as of March 31, 2020 UScellular TDS Telecom Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 762 $ 240 $ 24 $ 1,026 Equipment and product sales 201 — 34 235 Total operating revenues 963 240 58 1,261 Cost of services (excluding Depreciation, amortization and accretion reported below) 180 95 18 293 Cost of equipment and products 217 — 29 246 Selling, general and administrative 335 65 11 411 Depreciation, amortization and accretion 177 52 6 235 (Gain) loss on asset disposals, net 4 — — 4 Operating income (loss) 50 28 (6) 72 Equity in earnings of unconsolidated entities 45 — — 45 Interest and dividend income 4 2 — 6 Interest expense (24) 1 (14) (37) Other, net 1 — (1) — Income (loss) before income taxes 76 31 (21) 86 Income tax expense (benefit) 4 4 (5) 3 Net income (loss) 72 28 (17) 83 Add back: Depreciation, amortization and accretion 177 52 6 235 (Gain) loss on asset disposals, net 4 — — 4 Interest expense 24 (1) 14 37 Income tax expense (benefit) 4 4 (5) 3 Adjusted EBITDA 1 $ 281 $ 82 $ (1) $ 362 Investments in unconsolidated entities $ 469 $ 4 $ 36 $ 509 Total assets $ 8,251 $ 2,221 $ 423 $ 10,895 Capital expenditures $ 236 $ 54 $ 2 $ 292 Numbers may not foot due to rounding. 1 Adjusted earnings before interest, taxes, depreciation, amortization and accretion (Adjusted EBITDA) is a segment measure reported to the chief operating decision maker for purposes of assessing their performance. Adjusted EBITDA is defined as net income, adjusted for the items set forth in the reconciliation above. TDS believes Adjusted EBITDA is a useful measure of TDS’ operating results before significant recurring non-cash charges, gains and losses, and other items as presented above as they provide additional relevant and useful information to investors and other users of TDS' financial data in evaluating the effectiveness of its operations and underlying business trends in a manner that is consistent with management's evaluation of business performance. . |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policy Disclosures [Line Items] | |
Principles of Consolidation | The accounting policies of Telephone and Data Systems, Inc. (TDS) conform to accounting principles generally accepted in the United States of America (GAAP) as set forth in the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC). Unless otherwise specified, references to accounting provisions and GAAP in these notes refer to the requirements of the FASB ASC. The consolidated financial statements include the accounts of TDS and subsidiaries in which it has a controlling financial interest, including TDS’ 82%-owned subsidiary, United States Cellular Corporation (UScellular) and TDS’ wholly-owned subsidiaries, TDS Telecommunications LLC and TDS Broadband LLC (collectively, TDS Telecom). In addition, the consolidated financial statements include certain entities in which TDS has a variable interest that requires consolidation under GAAP. Intercompany accounts and transactions have been eliminated. TDS’ business segments reflected in this Quarterly Report on Form 10-Q for the period ended March 31, 2021, are UScellular and TDS Telecom. TDS’ non-reportable other business activities are presented as “Corporate, Eliminations and Other”, which includes the operations of TDS’ wholly-owned hosted and managed services (HMS) subsidiary, which operates under the OneNeck IT Solutions brand, and its wholly-owned subsidiary Suttle-Straus, Inc. (Suttle-Straus). HMS’ and Suttle-Straus’ financial results were not significant to TDS’ operations. All of TDS’ segments operate only in the United States. See Note 13 — Business Segment Information for summary financial information on each business segment. |
Basis of Accounting | The unaudited consolidated financial statements included herein have been prepared by TDS pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, TDS believes that the disclosures included herein are adequate to make the information presented not misleading. Certain numbers included herein are rounded to millions for ease of presentation; however, certain calculated amounts and percentages are determined using the unrounded numbers. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in TDS’ Annual Report on Form 10-K (Form 10-K) for the year ended December 31, 2020. The accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal recurring items, unless otherwise disclosed) necessary for the fair statement of TDS’ financial position as of March 31, 2021 and December 31, 2020 and its results of operations, comprehensive income, cash flows and changes in equity for the three months ended March 31, 2021 and 2020. These results are not necessarily indicative of the results to be expected for the full year. TDS has not changed its significant accounting and reporting policies from those disclosed in its Form 10-K for the year ended December 31, 2020. |
Revenue from Contract with Customer | As practical expedients, revenue related to contracts of less than one year, generally month-to-month contracts, and contracts with a fixed per-unit price and variable quantity, are excluded from these estimates.TDS expects that commission fees paid as a result of obtaining contracts are recoverable and therefore TDS defers and amortizes these costs. As a practical expedient, costs with an amortization period of one year or less are expensed as incurred. TDS also incurs fulfillment costs, such as installation costs, where there is an expectation that a future benefit will be realized. Deferred commission fees and fulfillment costs are amortized based on the timing of transfer of the goods or services to which the assets relate, typically the contract term. |
Variable Interest Entities | TDS consolidates VIEs in which it has a controlling financial interest as defined by GAAP and is therefore deemed the primary beneficiary. TDS reviews the criteria for a controlling financial interest at the time it enters into agreements and subsequently when events warranting reconsideration occur. These VIEs have risks similar to those described in the “Risk Factors” in this Form 10-Q and TDS’ Form 10-K for the year ended December 31, 2020. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Reconciliation of cash, cash equivalents and restricted cash | The following table provides a reconciliation of Cash and cash equivalents and restricted cash reported in the Consolidated Balance Sheet to the total of the amounts in the Consolidated Statement of Cash Flows. March 31, 2021 December 31, 2020 (Dollars in millions) Cash and cash equivalents $ 1,042 $ 1,429 Restricted cash included in Other current assets 37 23 Cash, cash equivalents and restricted cash in the statement of cash flows $ 1,079 $ 1,452 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenues | In the following table, TDS' revenues are disaggregated by type of service, which represents the relevant categorization of revenues for TDS' reportable segments, and timing of recognition. Service revenues are recognized over time and Equipment and product sales are point in time. Three Months Ended March 31, 2021 UScellular TDS Telecom Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 685 $ — $ — $ 685 Inbound roaming 28 — — 28 Residential — 157 — 157 Commercial — 47 — 47 Wholesale — 45 — 45 Other service 38 — 16 54 Service revenues from contracts with customers 751 248 16 1,016 Equipment and product sales 252 — 24 276 Total revenues from contracts with customers 1,003 248 40 1,292 Operating lease income 20 1 5 26 Total operating revenues $ 1,023 $ 249 $ 46 $ 1,318 Three Months Ended March 31, 2020 UScellular TDS Telecom Corporate, Eliminations and Other Total (Dollars in millions) Revenues from contracts with customers: Type of service: Retail service $ 671 $ — $ — $ 671 Inbound roaming 37 — — 37 Residential — 144 — 144 Commercial — 50 — 50 Wholesale — 45 — 45 Other service 35 — 18 53 Service revenues from contracts with customers 743 239 18 1,000 Equipment and product sales 201 — 34 235 Total revenues from contracts with customers 944 240 52 1,235 Operating lease income 19 1 6 26 Total operating revenues $ 963 $ 240 $ 58 $ 1,261 Numbers may not foot due to rounding |
Contract with Customer, Assets and Liabilities | The following table provides balances for contract assets from contracts with customers, which are recorded in Other current assets and Other assets and deferred charges in the Consolidated Balance Sheet, and contract liabilities from contracts with customers, which are recorded in Customer deposits and deferred revenues and Other deferred liabilities and credits in the Consolidated Balance Sheet. March 31, 2021 December 31, 2020 (Dollars in millions) Contract assets $ 13 $ 13 Contract liabilities $ 230 $ 216 |
Remaining Performance Obligations | The following table includes estimated service revenues expected to be recognized related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period. These estimates represent service revenues to be recognized when services are delivered to customers pursuant to service plan contracts and under certain roaming agreements with other carriers. These estimates are based on contracts in place as of March 31, 2021 and may vary from actual results. As practical expedients, revenue related to contracts of less than one year, generally month-to-month contracts, and contracts with a fixed per-unit price and variable quantity, are excluded from these estimates. Service Revenues (Dollars in millions) Remainder of 2021 $ 330 2022 187 Thereafter 184 Total $ 701 |
Contract Cost Assets | TDS expects that commission fees paid as a result of obtaining contracts are recoverable and therefore TDS defers and amortizes these costs. As a practical expedient, costs with an amortization period of one year or less are expensed as incurred. TDS also incurs fulfillment costs, such as installation costs, where there is an expectation that a future benefit will be realized. Deferred commission fees and fulfillment costs are amortized based on the timing of transfer of the goods or services to which the assets relate, typically the contract term. Contract cost asset balances, which are recorded in Other assets and deferred charges in the Consolidated Balance Sheet, were as follows: March 31, 2021 December 31, 2020 (Dollars in millions) Costs to obtain contracts Sales commissions $ 136 $ 139 Fulfillment costs Installation costs 11 10 Total contract cost assets $ 147 $ 149 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | TDS has applied the provisions of fair value accounting for purposes of computing the fair value of financial instruments for disclosure purposes as displayed below. Level within the Fair Value Hierarchy March 31, 2021 December 31, 2020 Book Value Fair Value Book Value Fair Value (Dollars in millions) Long-term debt Retail 2 $ 2,753 $ 2,814 $ 2,753 $ 2,809 Institutional 2 535 661 535 707 Other 2 796 796 230 230 |
Equipment Installment Plans (Ta
Equipment Installment Plans (Table) | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Equipment installment plan receivables | The following table summarizes equipment installment plan receivables. March 31, 2021 December 31, 2020 (Dollars in millions) Equipment installment plan receivables, gross $ 1,013 $ 1,007 Allowance for credit losses (72) (78) Equipment installment plan receivables, net $ 941 $ 929 Net balance presented in the Consolidated Balance Sheet as: Accounts receivable — Customers and agents (Current portion) $ 596 $ 590 Other assets and deferred charges (Non-current portion) 345 339 Equipment installment plan receivables, net $ 941 $ 929 |
Equipment installment plan receivables credit categories | The balance and aging of the equipment installment plan receivables on a gross basis by credit category were as follows: March 31, 2021 December 31, 2020 Lowest Risk Lower Risk Slight Risk Higher Risk Total Lowest Risk Lower Risk Slight Risk Higher Risk Total (Dollars in millions) Unbilled $ 826 $ 99 $ 24 $ 8 $ 957 $ 819 $ 98 $ 22 $ 9 $ 948 Billed — current 35 5 1 1 42 36 5 1 1 43 Billed — past due 7 4 2 1 14 8 5 2 1 16 Total $ 868 $ 108 $ 27 $ 10 $ 1,013 $ 863 $ 108 $ 25 $ 11 $ 1,007 The balance of the equipment installment plan receivables as of March 31, 2021 on a gross basis by year of origination were as follows: 2018 2019 2020 2021 Total (Dollars in millions) Lowest Risk $ 15 $ 202 $ 484 $ 167 $ 868 Lower Risk 1 18 61 28 108 Slight Risk 1 3 12 11 27 Higher Risk — 1 5 4 10 Total $ 17 $ 224 $ 562 $ 210 $ 1,013 |
Equipment installment plans allowance for credit losses | Activity for the three months ended March 31, 2021 and 2020, in the allowance for credit losses for equipment installment plan receivables was as follows: March 31, 2021 March 31, 2020 (Dollars in millions) Allowance for credit losses, beginning of period $ 78 $ 84 Bad debts expense 3 25 Write-offs, net of recoveries (9) (19) Allowance for credit losses, end of period $ 72 $ 90 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings per share | The amounts used in computing basic and diluted earnings per share attributable to TDS common shareholders were as follows: Three Months Ended 2021 2020 (Dollars and shares in millions, except per share amounts) Net income attributable to TDS common shareholders used in basic earnings per share $ 57 $ 69 Adjustments to compute diluted earnings: Noncontrolling interest adjustment (1) (1) Net income attributable to TDS common shareholders used in diluted earnings per share $ 56 $ 68 Weighted average number of shares used in basic earnings per share: Common Shares 107 108 Series A Common Shares 7 7 Total 114 115 Effects of dilutive securities 2 1 Weighted average number of shares used in diluted earnings per share 116 116 Basic earnings per share attributable to TDS common shareholders $ 0.49 $ 0.60 Diluted earnings per share attributable to TDS common shareholders $ 0.48 $ 0.59 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Licenses | |
Licenses | Activity related to Licenses for the three months ended March 31, 2021, is presented below: Licenses (Dollars in millions) Balance at December 31, 2020 $ 2,638 Acquisitions 1,283 Capitalized interest 3 Balance at March 31, 2021 $ 3,924 |
Investments in Unconsolidated_2
Investments in Unconsolidated Entities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity and measurement alternative method investments | TDS’ Investments in unconsolidated entities are accounted for using either the equity method or measurement alternative method as shown in the table below. The carrying value of measurement alternative method investments represents cost minus any impairments plus or minus any observable price changes. March 31, 2021 December 31, 2020 (Dollars in millions) Equity method investments $ 475 $ 456 Measurement alternative method investments 22 21 Total investments in unconsolidated entities $ 497 $ 477 The following table, which is based on unaudited information provided in part by third parties, summarizes the combined results of operations of TDS’ equity method investments. Three Months Ended 2021 2020 (Dollars in millions) Revenues $ 1,733 $ 1,662 Operating expenses 1,280 1,166 Operating income 453 496 Other income (expense), net 12 3 Net income $ 465 $ 499 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Term Loans | The following table summarizes the term loan credit agreements as of March 31, 2021: TDS UScellular (Dollars in millions) Maximum borrowing capacity $ 200 $ 300 Amount borrowed $ 200 $ 300 Amount available for use $ — $ — |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Variable Interest Entities [Abstract] | |
Consolidated VIE assets and liabilities | The following table presents the classification and balances of the consolidated VIEs’ assets and liabilities in TDS’ Consolidated Balance Sheet. March 31, 2021 December 31, 2020 (Dollars in millions) Assets Cash and cash equivalents $ 22 $ 18 Short-term investments 3 3 Accounts receivable 643 638 Inventory, net 3 3 Other current assets 34 21 Licenses 637 637 Property, plant and equipment, net 98 99 Operating lease right-of-use assets 39 37 Other assets and deferred charges 353 347 Total assets $ 1,832 $ 1,803 Liabilities Current liabilities $ 25 $ 26 Long-term operating lease liabilities 35 34 Other deferred liabilities and credits 20 19 Total liabilities $ 80 $ 79 |
Noncontrolling Interests (Table
Noncontrolling Interests (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Change Due to Net Income Attributable to Parent and Effects of Changes, Net [Abstract] | |
Noncontrolling interests | The following schedule discloses the effects of Net income attributable to TDS shareholders and changes in TDS’ ownership interest in UScellular on TDS’ equity: Three Months Ended March 31, 2021 2020 (Dollars in millions) Net income attributable to TDS shareholders $ 59 $ 69 Transfers (to) from noncontrolling interests Change in TDS' Capital in excess of par value from UScellular's issuance of UScellular shares (3) (1) Change in TDS' Capital in excess of par value from UScellular's repurchases of UScellular shares — 13 Net transfers (to) from noncontrolling interests (3) 12 Net income attributable to TDS shareholders after transfers (to) from noncontrolling interests $ 56 $ 81 |
Business Segment Information (T
Business Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Business segment information | Financial data for TDS’ reportable segments for the three month periods ended, or as of March 31, 2021 and March 31, 2020, is as follows. See Note 1 — Basis of Presentation for additional information. Three Months Ended or as of March 31, 2021 UScellular TDS Telecom Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 771 $ 249 $ 22 $ 1,042 Equipment and product sales 252 — 24 276 Total operating revenues 1,023 249 46 1,318 Cost of services (excluding Depreciation, amortization and accretion reported below) 185 97 17 299 Cost of equipment and products 275 — 18 293 Selling, general and administrative 305 70 13 388 Depreciation, amortization and accretion 170 49 5 224 (Gain) loss on asset disposals, net 5 — — 5 (Gain) loss on sale of business and other exit costs, net (1) — — (1) Operating income (loss) 84 32 (6) 110 Equity in earnings of unconsolidated entities 42 — — 42 Interest and dividend income 2 — 1 3 Interest expense (39) 1 (15) (53) Income (loss) before income taxes 89 33 (20) 102 Income tax expense (benefit) 27 8 (4) 31 Net income (loss) 62 24 (15) 71 Add back: Depreciation, amortization and accretion 170 49 5 224 (Gain) loss on asset disposals, net 5 — — 5 (Gain) loss on sale of business and other exit costs, net (1) — — (1) Interest expense 39 (1) 15 53 Income tax expense (benefit) 27 8 (4) 31 Adjusted EBITDA 1 $ 302 $ 81 $ — $ 383 Investments in unconsolidated entities $ 455 $ 4 $ 38 $ 497 Total assets $ 10,148 $ 2,377 $ 882 $ 13,407 Capital expenditures $ 125 $ 70 $ 2 $ 197 Three Months Ended or as of March 31, 2020 UScellular TDS Telecom Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service $ 762 $ 240 $ 24 $ 1,026 Equipment and product sales 201 — 34 235 Total operating revenues 963 240 58 1,261 Cost of services (excluding Depreciation, amortization and accretion reported below) 180 95 18 293 Cost of equipment and products 217 — 29 246 Selling, general and administrative 335 65 11 411 Depreciation, amortization and accretion 177 52 6 235 (Gain) loss on asset disposals, net 4 — — 4 Operating income (loss) 50 28 (6) 72 Equity in earnings of unconsolidated entities 45 — — 45 Interest and dividend income 4 2 — 6 Interest expense (24) 1 (14) (37) Other, net 1 — (1) — Income (loss) before income taxes 76 31 (21) 86 Income tax expense (benefit) 4 4 (5) 3 Net income (loss) 72 28 (17) 83 Add back: Depreciation, amortization and accretion 177 52 6 235 (Gain) loss on asset disposals, net 4 — — 4 Interest expense 24 (1) 14 37 Income tax expense (benefit) 4 4 (5) 3 Adjusted EBITDA 1 $ 281 $ 82 $ (1) $ 362 Investments in unconsolidated entities $ 469 $ 4 $ 36 $ 509 Total assets $ 8,251 $ 2,221 $ 423 $ 10,895 Capital expenditures $ 236 $ 54 $ 2 $ 292 Numbers may not foot due to rounding. 1 Adjusted earnings before interest, taxes, depreciation, amortization and accretion (Adjusted EBITDA) is a segment measure reported to the chief operating decision maker for purposes of assessing their performance. Adjusted EBITDA is defined as net income, adjusted for the items set forth in the reconciliation above. TDS believes Adjusted EBITDA is a useful measure of TDS’ operating results before significant recurring non-cash charges, gains and losses, and other items as presented above as they provide additional relevant and useful information to investors and other users of TDS' financial data in evaluating the effectiveness of its operations and underlying business trends in a manner that is consistent with management's evaluation of business performance. |
Basis of Presentation - Narrati
Basis of Presentation - Narrative (Details) | 3 Months Ended |
Mar. 31, 2021 | |
Basis of Presentation [Line Items] | |
Change in reportable segments | Change in Reportable SegmentsDuring the first quarter of 2021, TDS modified its reporting segment structure to combine its Wireline and Cable segments into a single reportable segment for TDS Telecom. TDS Telecom believes this presentation better articulates its progress and performance against its strategy, which includes a focus on overall broadband growth and future fiber deployment across its markets. This change also reflects TDS Telecom's progress in aligning its organizational, operational and support structures to leverage one cost base to better support its customers across all of its markets. Prior periods have been updated to conform to this revised presentation. See Note 13 — Business Segment Information for additional information on TDS' reportable segments. |
UScellular | |
Basis of Presentation [Line Items] | |
TDS ownership of UScellular | 82.00% |
Basis of Presentation - Cash, C
Basis of Presentation - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents | $ 1,042 | $ 1,429 | ||
Restricted cash included in Other current assets | 37 | 23 | ||
Cash, cash equivalents and restricted cash in the statement of cash flows | $ 1,079 | $ 1,452 | $ 434 | $ 474 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of revenue | ||
Revenue from contracts with customers | $ 1,292 | $ 1,235 |
Operating lease income | 26 | 26 |
Total operating revenues | 1,318 | 1,261 |
Transferred over time | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 1,016 | 1,000 |
Transferred over time | Retail service | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 685 | 671 |
Transferred over time | Inbound roaming | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 28 | 37 |
Transferred over time | Residential | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 157 | 144 |
Transferred over time | Commercial | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 47 | 50 |
Transferred over time | Wholesale | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 45 | 45 |
Transferred over time | Other service | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 54 | 53 |
Transferred at point in time | Equipment and product sales | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 276 | 235 |
UScellular | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 1,003 | 944 |
Operating lease income | 20 | 19 |
Total operating revenues | 1,023 | 963 |
UScellular | Transferred over time | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 751 | 743 |
UScellular | Transferred over time | Retail service | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 685 | 671 |
UScellular | Transferred over time | Inbound roaming | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 28 | 37 |
UScellular | Transferred over time | Residential | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
UScellular | Transferred over time | Commercial | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
UScellular | Transferred over time | Wholesale | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
UScellular | Transferred over time | Other service | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 38 | 35 |
UScellular | Transferred at point in time | Equipment and product sales | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 252 | 201 |
TDS Telecom | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 248 | 240 |
Operating lease income | 1 | 1 |
Total operating revenues | 249 | 240 |
TDS Telecom | Transferred over time | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 248 | 239 |
TDS Telecom | Transferred over time | Retail service | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
TDS Telecom | Transferred over time | Inbound roaming | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
TDS Telecom | Transferred over time | Residential | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 157 | 144 |
TDS Telecom | Transferred over time | Commercial | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 47 | 50 |
TDS Telecom | Transferred over time | Wholesale | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 45 | 45 |
TDS Telecom | Transferred over time | Other service | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
TDS Telecom | Transferred at point in time | Equipment and product sales | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
Corporate, Eliminations and Other | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 40 | 52 |
Operating lease income | 5 | 6 |
Total operating revenues | 46 | 58 |
Corporate, Eliminations and Other | Transferred over time | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 16 | 18 |
Corporate, Eliminations and Other | Transferred over time | Retail service | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
Corporate, Eliminations and Other | Transferred over time | Inbound roaming | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
Corporate, Eliminations and Other | Transferred over time | Residential | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
Corporate, Eliminations and Other | Transferred over time | Commercial | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
Corporate, Eliminations and Other | Transferred over time | Wholesale | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 0 | 0 |
Corporate, Eliminations and Other | Transferred over time | Other service | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | 16 | 18 |
Corporate, Eliminations and Other | Transferred at point in time | Equipment and product sales | ||
Disaggregation of revenue | ||
Revenue from contracts with customers | $ 24 | $ 34 |
Revenue Recognition - Contract
Revenue Recognition - Contract Assets and Contract Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 13 | $ 13 |
Contract liabilities | 230 | $ 216 |
Revenue recognized | $ 131 |
Revenue Recognition - Performan
Revenue Recognition - Performance Obligations (Details) $ in Millions | Mar. 31, 2021USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 701 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 330 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected timing of remaining performance obligation, period | 9 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 187 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected timing of remaining performance obligation, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 184 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected timing of remaining performance obligation, period |
Revenue Recognition - Contrac_2
Revenue Recognition - Contract Cost Assets (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Contract Cost Assets | ||
Contract cost assets | $ 147 | $ 149 |
Sales commissions | ||
Contract Cost Assets | ||
Contract cost assets | 136 | 139 |
Installation costs | ||
Contract Cost Assets | ||
Contract cost assets | $ 11 | $ 10 |
Revenue Recognition - Narrative
Revenue Recognition - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Capitalized contract cost | ||
Amortization of contract cost assets | $ 29 | $ 31 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
7.0% Senior Notes | ||
Financial Instruments | ||
Interest rate | 7.00% | |
6.875% Senior Notes | ||
Financial Instruments | ||
Interest rate | 6.875% | |
6.625% Senior Notes | ||
Financial Instruments | ||
Interest rate | 6.625% | |
5.875% Senior Notes | ||
Financial Instruments | ||
Interest rate | 5.875% | |
7.25% 2063 Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 7.25% | |
7.25% 2064 Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 7.25% | |
6.25% Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 6.25% | |
6.95% Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 6.95% | |
6.7% Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 6.70% | |
5.5% Senior Notes | UScellular | ||
Financial Instruments | ||
Interest rate | 5.50% | |
Book Value | Retail | ||
Financial Instruments | ||
Long-term debt | $ 2,753 | $ 2,753 |
Book Value | Institutional | ||
Financial Instruments | ||
Long-term debt | 535 | 535 |
Book Value | Other | ||
Financial Instruments | ||
Long-term debt | 796 | 230 |
Fair Value | Level 2 | Retail | ||
Financial Instruments | ||
Long-term debt | 2,814 | 2,809 |
Fair Value | Level 2 | Institutional | ||
Financial Instruments | ||
Long-term debt | 661 | 707 |
Fair Value | Level 2 | Other | ||
Financial Instruments | ||
Long-term debt | $ 796 | $ 230 |
Interest rate | Institutional and Other | Minimum | ||
Financial Instruments | ||
Fair value assumption, interest rate | 1.31% | 1.35% |
Interest rate | Institutional and Other | Maximum | ||
Financial Instruments | ||
Fair value assumption, interest rate | 4.48% | 3.75% |
Equipment Installment Plans - E
Equipment Installment Plans - EIP Receivables (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment installment plan receivables, gross | $ 1,013 | $ 1,007 |
Allowance for credit losses | (72) | (78) |
Equipment installment plan receivables, net | 941 | 929 |
Accounts receivable — Customers and agents (Current portion) | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment installment plan receivables, net | 596 | 590 |
Other assets and deferred charges (Non-current portion) | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment installment plan receivables, net | $ 345 | $ 339 |
Equipment Installment Plans - G
Equipment Installment Plans - Gross Receivables by Credit Category (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables, gross | $ 1,013 | $ 1,007 |
2018 | 17 | |
2019 | 224 | |
2020 | 562 | |
2021 | 210 | |
Unbilled | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 957 | 948 |
Billed | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 42 | 43 |
Equipment installment plan receivables, past due | 14 | 16 |
Lowest Risk | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables, gross | 868 | 863 |
2018 | 15 | |
2019 | 202 | |
2020 | 484 | |
2021 | 167 | |
Lowest Risk | Unbilled | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 826 | 819 |
Lowest Risk | Billed | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 35 | 36 |
Equipment installment plan receivables, past due | 7 | 8 |
Lower Risk | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables, gross | 108 | 108 |
2018 | 1 | |
2019 | 18 | |
2020 | 61 | |
2021 | 28 | |
Lower Risk | Unbilled | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 99 | 98 |
Lower Risk | Billed | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 5 | 5 |
Equipment installment plan receivables, past due | 4 | 5 |
Slight Risk | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables, gross | 27 | 25 |
2018 | 1 | |
2019 | 3 | |
2020 | 12 | |
2021 | 11 | |
Slight Risk | Unbilled | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 24 | 22 |
Slight Risk | Billed | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 1 | 1 |
Equipment installment plan receivables, past due | 2 | 2 |
Higher Risk | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables, gross | 10 | 11 |
2018 | 0 | |
2019 | 1 | |
2020 | 5 | |
2021 | 4 | |
Higher Risk | Unbilled | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 8 | 9 |
Higher Risk | Billed | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Equipment installment plan receivables | 1 | 1 |
Equipment installment plan receivables, past due | $ 1 | $ 1 |
Equipment Installment Plans - A
Equipment Installment Plans - Allowance for Credit Losses (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Allowance for credit losses | ||
Allowance for credit losses, beginning of period | $ 78 | |
Allowance for credit losses, end of period | 72 | |
Equipment Installment Plan Receivable | ||
Allowance for credit losses | ||
Allowance for credit losses, beginning of period | 78 | $ 84 |
Bad debts expense | 3 | 25 |
Write-offs, net of recoveries | (9) | (19) |
Allowance for credit losses, end of period | $ 72 | $ 90 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate | 30.10% | 4.20% |
Earnings Per Share - Reconcilia
Earnings Per Share - Reconciliation (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Earnings per share | ||
Net income attributable to TDS common shareholders used in basic earnings per share | $ 57 | $ 69 |
Noncontrolling interest adjustment | (1) | (1) |
Net income attributable to TDS common shareholders used in diluted earnings per share | $ 56 | $ 68 |
Weighted average number of shares used in basic earnings per share (in shares) | 114 | 115 |
Effects of dilutive securities (in shares) | 2 | 1 |
Weighted average number of shares used in diluted earnings per share (in shares) | 116 | 116 |
Basic earnings per share attributable to TDS common shareholders (in dollars per share) | $ 0.49 | $ 0.60 |
Diluted earnings per share attributable to TDS common shareholders (in dollars per share) | $ 0.48 | $ 0.59 |
Common Shares | ||
Earnings per share | ||
Weighted average number of shares used in basic earnings per share (in shares) | 107 | 108 |
Series A Common Shares | ||
Earnings per share | ||
Weighted average number of shares used in basic earnings per share (in shares) | 7 | 7 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 4 | 4 |
Intangible Assets (Details)
Intangible Assets (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Licenses | |
Balance, beginning of period | $ 2,638 |
Acquisitions | 1,283 |
Capitalized interest | 3 |
Balance, end of period | $ 3,924 |
Intangible Assets - Narrative (
Intangible Assets - Narrative (Details) $ in Millions | Apr. 01, 2021USD ($) | Mar. 31, 2021USD ($)license | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) |
Licenses | ||||
Cash paid for licenses | $ 1,261 | $ 26 | ||
Auction 107 | ||||
Licenses | ||||
Licenses won | license | 254 | |||
Total winning bid | $ 1,283 | |||
FCC upfront payment | $ 30 | |||
Auction 107 | Subsequent event | ||||
Licenses | ||||
Cash paid for licenses | $ 178 |
Investment in Unconsolidated En
Investment in Unconsolidated Entities - Schedule of Investments (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |||
Equity method investments | $ 475 | $ 456 | |
Measurement alternative method investments | 22 | 21 | |
Total investments in unconsolidated entities | 497 | $ 509 | $ 477 |
Schedule of Equity Method Investments [Line Items] | |||
Revenues | 1,318 | 1,261 | |
Operating expenses | 1,208 | 1,189 | |
Operating income | 110 | 72 | |
Other income (expense), net | 0 | ||
Net income | 71 | 83 | |
Equity Method Investments | |||
Schedule of Equity Method Investments [Line Items] | |||
Revenues | 1,733 | 1,662 | |
Operating expenses | 1,280 | 1,166 | |
Operating income | 453 | 496 | |
Other income (expense), net | 12 | 3 | |
Net income | $ 465 | $ 499 |
Debt - Term Loan Facilities (De
Debt - Term Loan Facilities (Details) - USD ($) | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Mar. 31, 2020 |
Debt Instrument [Line Items] | ||||
Repayment of long-term debt | $ 0 | $ 2,000,000 | ||
TDS Term loan facility | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | 200,000,000 | |||
Amount borrowed | 200,000,000 | |||
Amount available for use | $ 0 | |||
TDS Term loan facility | Subsequent event | ||||
Debt Instrument [Line Items] | ||||
Repayment of long-term debt | $ 500,000 | |||
TDS Term loan facility | LIBOR rate | ||||
Debt Instrument [Line Items] | ||||
Contractual spread | 2.00% | |||
UScellular | UScellular Term loan facility | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 300,000,000 | |||
Amount borrowed | 300,000,000 | |||
Amount available for use | $ 0 | |||
UScellular | UScellular Term loan facility | Subsequent event | ||||
Debt Instrument [Line Items] | ||||
Repayment of long-term debt | $ 750,000 | |||
UScellular | UScellular Term loan facility | LIBOR rate | ||||
Debt Instrument [Line Items] | ||||
Contractual spread | 2.25% |
Debt - Receivables Securitizati
Debt - Receivables Securitization Agreement (Details) - UScellular - Receivables securitization agreement $ in Millions | Mar. 31, 2021USD ($) |
Debt Instrument [Line Items] | |
Amount borrowed | $ 275 |
Maximum borrowing capacity | 300 |
Assets pledged as collateral | $ 446 |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) $ in Millions | May 12, 2021 | Mar. 31, 2021 |
Subsequent event | ||
Debt Instrument [Line Items] | ||
Unamortized debt issuance costs | $ 26 | |
Redemption price rate | 100.00% | |
6.875% Senior Notes | ||
Debt Instrument [Line Items] | ||
Interest rate | 6.875% | |
6.875% Senior Notes | Subsequent event | ||
Debt Instrument [Line Items] | ||
Amount redeemed | $ 225 | |
Interest rate | 6.875% | |
7.0% Senior Notes | ||
Debt Instrument [Line Items] | ||
Interest rate | 7.00% | |
7.0% Senior Notes | Subsequent event | ||
Debt Instrument [Line Items] | ||
Amount redeemed | $ 300 | |
Interest rate | 7.00% | |
7.25% 2063 Senior Notes | UScellular | Subsequent event | ||
Debt Instrument [Line Items] | ||
Amount redeemed | $ 275 | |
Interest rate | 7.25% |
Debt - Revolving Credit Agreeme
Debt - Revolving Credit Agreements (Details) $ in Millions | May 01, 2021USD ($) |
Subsequent event | TDS Revolving credit facility | |
Line of Credit Facility [Line Items] | |
Amount borrowed | $ 100 |
Variable Interest Entities - Co
Variable Interest Entities - Consolidated Balance Sheet (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | ||
Assets | |||||
Cash and cash equivalents | $ 1,042 | $ 1,429 | |||
Short-term investments | 3 | 3 | |||
Accounts receivable | 978 | 1,004 | |||
Inventory, net | 145 | 154 | |||
Other current assets | 53 | 36 | |||
Licenses | 3,924 | 2,638 | |||
Property, plant and equipment, net | 3,951 | 3,972 | |||
Operating lease right-of-use assets | 1,005 | 998 | |||
Other assets and deferred charges | 627 | 652 | |||
Total assets | 13,407 | [1] | 12,525 | [1] | $ 10,895 |
Liabilities | |||||
Current liabilities | 963 | 1,153 | |||
Long-term operating lease liabilities | 941 | 940 | |||
Other deferred liabilities and credits | 558 | 541 | |||
Consolidated Variable Interest Entities | |||||
Assets | |||||
Cash and cash equivalents | 22 | 18 | |||
Short-term investments | 3 | 3 | |||
Accounts receivable | 643 | 638 | |||
Inventory, net | 3 | 3 | |||
Other current assets | 34 | 21 | |||
Licenses | 637 | 637 | |||
Property, plant and equipment, net | 98 | 99 | |||
Operating lease right-of-use assets | 39 | 37 | |||
Other assets and deferred charges | 353 | 347 | |||
Total assets | 1,832 | 1,803 | |||
Liabilities | |||||
Current liabilities | 25 | 26 | |||
Long-term operating lease liabilities | 35 | 34 | |||
Other deferred liabilities and credits | 20 | 19 | |||
Total liabilities | $ 80 | $ 79 | |||
[1] | The consolidated total assets as of March 31, 2021 and December 31, 2020, include assets held by consolidated variable interest entities (VIEs) of $1,244 million and $1,042 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of March 31, 2021 and December 31, 2020, include certain liabilities of consolidated VIEs of $17 million and $18 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 10 — Variable Interest Entities for additional information. |
Variable Interest Entities - Na
Variable Interest Entities - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Variable Interest Entity [Line Items] | |||
Investment in unconsolidated entities, maximum exposure | $ 5 | $ 5 | |
Capital contributions, loans or advances | 30 | $ 69 | |
USCC EIP LLC | |||
Variable Interest Entity [Line Items] | |||
Capital contributions, loans or advances | $ 10 | $ 55 |
Noncontrolling Interests (Detai
Noncontrolling Interests (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Change Due to Net Income Attributable to Parent and Effects of Changes, Net [Abstract] | ||
Net income attributable to TDS shareholders | $ 59 | $ 69 |
Transfers (to) from noncontrolling interests | ||
Change in TDS' Capital in excess of par value from UScellular's issuance of UScellular shares | (3) | (1) |
Change in TDS' Capital in excess of par value from UScellular's repurchases of UScellular shares | 0 | 13 |
Net transfers (to) from noncontrolling interests | (3) | 12 |
Net income attributable to TDS shareholders after transfers (to) from noncontrolling interests | $ 56 | $ 81 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Class of Stock [Line Items] | ||
Gross proceeds | $ 420,000,000 | $ 0 |
Liquidation preference per share (in dollars per share) | $ 25,000 | |
Preferred Shares | ||
Class of Stock [Line Items] | ||
Shares issued | 16,800 | |
Interest rate | 6.625% | |
Shares issued (price per share) | $ 25,000 | |
Gross proceeds | $ 420,000,000 | |
Depositary shares | 16,800,000 | |
Net cash proceeds | 406,000,000 | |
Issuance costs | 14,000,000 | |
Liquidation preference per share (in dollars per share) | $ 25,000 | |
Redemption price per Preferred Share | $ 25,000 | |
Common Shares issued upon conversion | 2,773.200 | |
Redemption price after credit rating downgrade | Preferred Shares | ||
Class of Stock [Line Items] | ||
Redemption price per Preferred Share | $ 25,500 |
Business Segment Information (D
Business Segment Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | $ 1,318 | $ 1,261 | |||
Selling, general and administrative | 388 | 411 | |||
Depreciation, amortization and accretion | 224 | 235 | |||
(Gain) loss on asset disposals, net | 5 | 4 | |||
(Gain) loss on sale of business and other exit costs, net | (1) | 0 | |||
Operating income | 110 | 72 | |||
Equity in earnings of unconsolidated entities | 42 | 45 | |||
Interest and dividend income | 3 | 6 | |||
Interest expense | (53) | (37) | |||
Other, net | 0 | ||||
Income before income taxes | 102 | 86 | |||
Income tax expense (benefit) | 31 | 3 | |||
Net income | 71 | 83 | |||
Depreciation, amortization and accretion | 224 | 235 | |||
(Gain) loss on asset disposals, net | 5 | 4 | |||
(Gain) loss on sale of business and other exit costs, net | (1) | 0 | |||
Interest expense | 53 | 37 | |||
Income tax expense | 31 | 3 | |||
Adjusted EBITDA | 383 | 362 | |||
Investments in unconsolidated entities | 497 | 509 | $ 477 | ||
Total assets | 13,407 | [1] | 10,895 | $ 12,525 | [1] |
Capital expenditures | 197 | 292 | |||
Service | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 1,042 | 1,026 | |||
Cost of goods and services | 299 | 293 | |||
Equipment and product sales | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 276 | 235 | |||
Cost of goods and services | 293 | 246 | |||
UScellular | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 1,023 | 963 | |||
Selling, general and administrative | 305 | 335 | |||
Depreciation, amortization and accretion | 170 | 177 | |||
(Gain) loss on asset disposals, net | 5 | 4 | |||
(Gain) loss on sale of business and other exit costs, net | (1) | ||||
Operating income | 84 | 50 | |||
Equity in earnings of unconsolidated entities | 42 | 45 | |||
Interest and dividend income | 2 | 4 | |||
Interest expense | (39) | (24) | |||
Other, net | 1 | ||||
Income before income taxes | 89 | 76 | |||
Income tax expense (benefit) | 27 | 4 | |||
Net income | 62 | 72 | |||
Depreciation, amortization and accretion | 170 | 177 | |||
(Gain) loss on asset disposals, net | 5 | 4 | |||
(Gain) loss on sale of business and other exit costs, net | (1) | ||||
Interest expense | 39 | 24 | |||
Income tax expense | 27 | 4 | |||
Adjusted EBITDA | 302 | 281 | |||
Investments in unconsolidated entities | 455 | 469 | |||
Total assets | 10,148 | 8,251 | |||
Capital expenditures | 125 | 236 | |||
UScellular | Service | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 771 | 762 | |||
Cost of goods and services | 185 | 180 | |||
UScellular | Equipment and product sales | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 252 | 201 | |||
Cost of goods and services | 275 | 217 | |||
TDS Telecom | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 249 | 240 | |||
Selling, general and administrative | 70 | 65 | |||
Depreciation, amortization and accretion | 49 | 52 | |||
(Gain) loss on asset disposals, net | 0 | 0 | |||
(Gain) loss on sale of business and other exit costs, net | 0 | ||||
Operating income | 32 | 28 | |||
Equity in earnings of unconsolidated entities | 0 | 0 | |||
Interest and dividend income | 0 | 2 | |||
Interest expense | 1 | 1 | |||
Other, net | 0 | ||||
Income before income taxes | 33 | 31 | |||
Income tax expense (benefit) | 8 | 4 | |||
Net income | 24 | 28 | |||
Depreciation, amortization and accretion | 49 | 52 | |||
(Gain) loss on asset disposals, net | 0 | 0 | |||
(Gain) loss on sale of business and other exit costs, net | 0 | ||||
Interest expense | (1) | (1) | |||
Income tax expense | 8 | 4 | |||
Adjusted EBITDA | 81 | 82 | |||
Investments in unconsolidated entities | 4 | 4 | |||
Total assets | 2,377 | 2,221 | |||
Capital expenditures | 70 | 54 | |||
TDS Telecom | Service | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 249 | 240 | |||
Cost of goods and services | 97 | 95 | |||
TDS Telecom | Equipment and product sales | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 0 | 0 | |||
Cost of goods and services | 0 | 0 | |||
Corporate, Eliminations and Other | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 46 | 58 | |||
Selling, general and administrative | 13 | 11 | |||
Depreciation, amortization and accretion | 5 | 6 | |||
(Gain) loss on asset disposals, net | 0 | 0 | |||
(Gain) loss on sale of business and other exit costs, net | 0 | ||||
Operating income | (6) | (6) | |||
Equity in earnings of unconsolidated entities | 0 | 0 | |||
Interest and dividend income | 1 | 0 | |||
Interest expense | (15) | (14) | |||
Other, net | (1) | ||||
Income before income taxes | (20) | (21) | |||
Income tax expense (benefit) | (4) | (5) | |||
Net income | (15) | (17) | |||
Depreciation, amortization and accretion | 5 | 6 | |||
(Gain) loss on asset disposals, net | 0 | 0 | |||
(Gain) loss on sale of business and other exit costs, net | 0 | ||||
Interest expense | 15 | 14 | |||
Income tax expense | (4) | (5) | |||
Adjusted EBITDA | 0 | (1) | |||
Investments in unconsolidated entities | 38 | 36 | |||
Total assets | 882 | 423 | |||
Capital expenditures | 2 | 2 | |||
Corporate, Eliminations and Other | Service | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 22 | 24 | |||
Cost of goods and services | 17 | 18 | |||
Corporate, Eliminations and Other | Equipment and product sales | |||||
Segment Reporting Information [Line Items] | |||||
Total operating revenues | 24 | 34 | |||
Cost of goods and services | $ 18 | $ 29 | |||
[1] | The consolidated total assets as of March 31, 2021 and December 31, 2020, include assets held by consolidated variable interest entities (VIEs) of $1,244 million and $1,042 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of March 31, 2021 and December 31, 2020, include certain liabilities of consolidated VIEs of $17 million and $18 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 10 — Variable Interest Entities for additional information. |