Telephone and Data Systems Q2 Earnings Call Highlights

TDS Telecom accelerated its fiber expansion, raising 2026 delivery guidance to 250,000–300,000 new service addresses and capital-expenditure guidance to $625 million–$675 million. Fiber residential net additions rose 47% year over year in the second quarter. Legacy copper and cable declines continued to weigh on results, prompting TDS to lower 2026 telecom revenue guidance to $1.0 billion–$1.025 billion and narrow adjusted EBITDA guidance to $310 million–$330 million. Array Digital Infrastructure completed $1.17 billion in spectrum sales to T-Mobile and Verizon, has agreements to monetize about 70% of its spectrum holdings, and raised its 2026 revenue and adjusted EBITDA outlooks.

Telephone and Data Systems NYSE: TDS reported second-quarter progress in its fiber expansion and tower operations, while lowering revenue expectations for its telecom business amid continued pressure from legacy copper and cable services. The company also said Array Digital Infrastructure completed major spectrum transactions during the quarter and raised several elements of its full-year outlook.

TDS Chief Executive Officer Walter Carlson said the company would not provide an update on its previously announced all-stock proposal to acquire the Array shares it does not already own. Array’s board has formed an independent special committee to evaluate the proposal.

TDS Telecom delivered approximately 66,000 marketable fiber service addresses during the second quarter, bringing first-half delivery to about 106,000 addresses. Ken Dixon, president and CEO of TDS Telecom, said the first-half performance was the strongest in company history and exceeded the company’s address delivery in the second half of 2025, traditionally its busiest construction period. The company increased its 2026 fiber address delivery guidance by 50,000 addresses and now expects to add between 250,000 and 300,000 new marketable fiber service addresses this year.

TDS Telecom also raised its capital-expenditure outlook to a range of $625 million to $675 million to support the accelerated construction activity. These 11 stocks will be Dividend Kings in 5 years or less. TDS Telecom ended the quarter with nearly 1.2 million fiber service addresses, representing 60% of its total footprint, with 80% capable of gigabit speeds. The company said it is using federal Enhanced Alternative Connect America Cost Model, or E-ACAM, support to expand fiber to more than 300,000 addresses in 22 states within its incumbent footprint over the next two years. Dixon said TDS Telecom has already met its 2026 E-ACAM obligations in three states and has its highest crew counts ever in its remaining E-ACAM markets. He added that the company is seeing strong demand when it brings fiber to markets previously served by copper infrastructure.

Residential fiber net additions totaled approximately 15,100 in the second quarter, up 47% from a year earlier. TDS said it has expanded door-to-door sales capacity, added outside sales vendors, and improved performance through its online channel. The company is also adding sales resources in cable and multi-dwelling-unit markets.

Despite fiber growth, TDS Telecom reported total operating revenue declined 6% year over year in the second quarter, or 4% excluding divestitures. Kristina Bothfeld, vice president of financial analysis and strategic planning, said approximately half of the year-over-year decline reflected discrete wholesale revenue adjustments that ben...