United States Cellular Corporat (UZF) 5 May 232023 Q1 Earnings call transcript

Thank you for standing by. At this time, I would like to welcome everyone to the TDS and U.S. Cellular First Quarter 2023 Operating Results Call. [Operator Instructions] Colleen Thompson, Vice President of Corporate Relations, you may begin your conference.

Good morning, and thank you for joining us. Relations you accompany of which our find the make have presentation you to TDS on to the prepared comments Investor want all the aware we can and We U.S. of sections this morning, Cellular websites.

prepared today Officer. Chief TDS Vice Financial Vicki are me Doug President, TDS Cellular, U.S. and Officer LT Vice With and and comments and Chambers, Executive Vice Executive Officer; President from Financial Treasurer; offering and Chief From Villacrez, Therivel, President Finance of from Executive Senior Financial Chief simultaneously call referred on This including this Brukwicki, see Cellular and to Officer. Michelle Telecom, Please call, slides non-GAAP President webcast and being website websites. Investor is for reconciliations. Relations on the the U.S. TDS

income operating including Forms before before TDS highlight wireless XX-Q yesterday. adjusted both and depreciation adjusted amortization the Cellular's Cellular OIBDA or for SEC releases guidance taxes, contributions filed provide interest, X-K EBITDA, or and earnings partnerships. our the U.S. and press and depreciation amortization, to U.S. and of We their

risks on set that presentation this uncertainties. forth during discussed about in contain shown subject Slide information statements and and to future forward-looking call financial X, are expected results the As and the

do just sure please. a One Operator, could lines are second, Colleen. you favor make the and us all muted,

our Slide press forward-looking in version are uncertainties. paragraph in going statements that harbor about contains to the call the releases SEC I'm events the back information filings. financial review and extended discussed subject to results Please to this during presentation safe risks X, expected Okay. go set our and included the forth in and and and future

video in Stock if in X, Exchange with And us. please policy, open have we TMT an York upcoming XX, as IR May attending will And door speaking virtually attending out we you're late Conference. Access In interested terms always, June, call Conference in Investor or so JPMorgan's we be New the on reach will XXst our on be schedule Slide Annual Boston. of

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

everyone. our its with you its in XXX in executing morning, guidance advancing good investments TDS and new strategy Colleen, deploy Telecom Both you, and in units reaffirmed fiber their to network making is approximately business Thank of Cellular significant February. markets. is U.S. Okay. shared

We balance support continue XXXX. have to investments we within planned and with strength levels enterprise the of to are ensure needs We the quarter needed, sheet $X.X choose ended our for approximately leverage of the the liquidity, asset have the access to billion to revolvers including and we to markets. facility capital help securitization sources in investments to debt our available from and continue as cash, fund managing

turn Cellular's I'll results. update call now to U.S. to on And you LT LT? the over

well. morning, Thanks, Vicki. everyone we turn to is If X. everybody. Slide I hope Good doing

have although still plenty top results. Our work be the pleased customer I've do, improving continues And we I'm to of with that to progress priority seen.

see a hope we've trends basis. X, on Slide adds improved As We've a sequential driven both you to can on And churn postpaid continue moving year-over-year gross basis. both and we those improved see forward. year-over-year postpaid on

take seeing. just to consumer were promotional challenges. see for trials, in about to regional the order you that that to of benefit. churn to And the in efforts knew now starting pricing the to launched in on drivers we address about channel. a And our talk subscriber to months reduction. see of done second specifically, results consumer we've churn and X testing the To several want I you're based we're the And X address mid-'XX, we we some back, take looking would it

year-over-year. XX% Our voluntary churn improved about

flat on gross to to see And have those of average, continue flat plans trajectory selected of steady in our unlimited higher plans. we our time, same the improve tier we adoption order the the customers ad At rate rate nearly plans. launched XX% and also

a that promotional contract rate of on traditional similar the customers economics postpaid quick lower terms. that subscriber over pricing, so those for generates And than pricing their and pleased financial higher discounts our flat and between have flat levels while plans with those device rate we're are plants are ARPU striking reminder, As not eligible aggressiveness. I'm balance

You'll see quarter. up postpaid is X% ARPU also for the

continued expect XXX,XXX finished and want a later also fixed second the this subscribers year-over-year. subscribers, We year. up quarter take wireless. we Gross in I with to XXX% to our highlight reach strong are adds XX,XXX momentum and

We for year. until the fixed deploy wireless footprint provide additional to of expect coming additionally, the momentum quarter wireless spectrum our fixed of did growth another we expand growth to year-over-year in quarter as mid-band in that not last And quarters. June solid entire our second as start we will

the produced tower XX% strong presentation Slide with performance, to results Our business include highlight And of to another some revenues quarter presentation. metrics also growing of we've year-over-year. our our expanded you on as see XX further additional

quarter the it's out minutes or days, relationship Promoter to Score, has months. positively taking is campaign for US. reset affected from your initiative your hours the up X challenge campaign the called X. in few X with very and been response We break to past Down meaningfully a on a encouraging, for brand order an simple we Built master pretty included also phone which our just technology. action, our in even The in believe built Phones The Net rolled for That was X

be C-band, ready traffic We've includes we'll portions up carried which sites to that it On when network continued the that XX% in up spectrum mid-band our is light be and about supporting we so out expect our in of markets deployment, of with the and XXXX. by spectrum to DOD clears to our light building XG. beginning network side, late further

recent investments this of continue decision spend announced improve focus focus was this week, a alignment I we've and our to well revenues I returns while up prioritize As made in staffing a the and operation. as as carefully of operational numerous reduction at effectiveness. our Earlier it efficiency business. And growing a our us the spans our our comments, my we considered decision action we wrap want to this moment to one, a and U.S. discussing on as and difficult just across Cellular, and was sharpen areas that allows our and

our customers in this excellence. I we the continued some Doug context our impact care additional with terms financials empathy focus thank to for quarter. with our will want and we'll all of with during dedication culture, provide in with respect focus serving our their consistent and our the team And on to as of associates and transition

hand with over to I'm And going it that, Doug. to

Thanks, LT. Good morning.

the first part a on net due handset contract losses basis year-over-year voluntary on a quarter $XX,XXX increase results customers X. improved Slide result in XXXX. with review percentage Let's due customer large primarily voluntary half as our and Postpaid both lower improved start as of year-over-year churn defections of of a our of attractive of XXXX second in the sequentially in in and upgrade to offers to

and by saw net driven additions basis, customer increased We year-over-year on by growth. wireless gross a connected fixed X,XXX device

the base mentioned, LT from fixed year to prior in As customers XX% a continue up we and the see of of XXXX. end from momentum wireless XX% up strong with

decreased X. Slide additions net X,XXX. gross declined Moving additions Prepaid prepaid and to XX,XXX

believe In year-over-year and terms available customers contributed in of we income pool declined decrease additions, gross the overall of to refunds tax the this.

we flat to between our our a prepaid provide postpaid parity the flat In prepaid, as of seeing addition, and offering trend better that's offer our rate take are and our good rate postpaid plans plans, customers given pricing our choosing instead rate flat economics. relative

a prepaid rate. saw churn in decline our we Lastly,

prior average roaming on base Slide revenue. results starting let's declining revenue to the declines quarter turn with are drivers year first lower subscriber X%. the for XX. primary from financial the the and X% The in Now of operating revenue revenues postpaid service Total service decreased

than You we profitability. note, to due our rolling in offset carrier in is revenue rates to in is decline And and roaming our decrease roaming the decline roaming is that the will by partners, decline the accretive therefore, off-net overall reciprocal this rates decreasing see with expense. revenue our roaming more

ARPU, side, plans an partially was in of by driven offering costs. and positive increase with our a revenues. in increase plan promotional an primarily device higher in mentioned tier the LT higher favorable in These offset ARPA mix by were the protection increase this adoption customer increase, of On the value, increase along result increases and postpaid our as and product

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

average Equipment per revenue volume, sold by of revenues same flat year-over-year. side the dynamics These being equipment on a the in decreased device. decline to by increase cost X% due played loss on an in out partially equipment resulting in primarily offset

turn Slide let's XX. to on our Next, financial results quarterly shown

and adjusted to operating For adjusted this discussion, I operating income amortization depreciation as will income. before refer

quarter in related first our revenues as ongoing million X%. effectively year-over-year operating This to operating expenses inflationary attributable incorporated will Cash include of program quarter in-year total in ongoing staffing through to $XX reduction effective our second mentioned costs by XXXX guidance. is manage pressures. declined in expenses noted, the As I severance our are XG deployment optimization the severance LT. and reduction and cash in to costs total impact become the This while impact and and our previously the savings increased X% both we addition XXXX action in cost of continue

to results controlling program expenses. respect This has delivered with outstanding our cash

bad debt essentially excluding XXXX, period the cash expense the aggressive we expect have by been impacts held the have and of XXXX. the in same loss pandemic, during which payment do flat Specifically, and environment to equipment through the promotional on XXXX behavior during and impacted expenses

in associated impacted which in our related brand first Selling, master by the primarily also new opening an of launch to Administrative timing advertising were the costs media increase in General highlighted and LT his expense expenses campaign, in with remarks. quarter

Capital driven by of expenditures. expenditures timing XX%, have increased

full managing in as multiyear deployment less mid-band indicates, year our cash flow. prior free capital year we XG expenditures guidance our invest our than while prudently to we As expect the XXXX be our

financial to we shown guidance our financial issued As XXXX in our guidance remain as track plan. remains year on this Slide we of on unchanged from February XX, the

turn Michelle I will Brukwicki, now the over to Michelle? call

I'm good this on and and report to quarter confirm meet track to pleased year. Doug, our you, both and to we goals out TDS first that Thank results set on Telecom's earlier financial morning, are operational everyone.

the key are messages. Here

service address and during as beginning the for service of delivery results meet fiber fiber year. marketable target This guidance set and service our that to delivered expected. quarter addresses fiber came the at address We out sets the financial quarter. foundation the First XX,XXX we us financial in

goal year Our be construction so significantly full and we months XXX,XXX activity is as winter deployment of will can up accelerate. move out we addresses, ramping

the into translating the revenue to is cases. On growth. in expansion pace adjusted on revenues guidance. phases financial result pressure This we This see of to market expected continue early costs penetration in start-up launches still grow is our incurring all is at continues we markets, new before our Since side, a in the markets our markets EBITDA. business are from the This our start of majority the part the XXXX in of in. coming of broadband

As on give more wanted everyone upfront. will I'll service improve to and these new which address have as I slides, follows generating our start markets fiber go in start through delivery, to context we but adjusted years. EBITDA future financials revenue, detail our program the this

move XX. to So let's Slide

Here, Investments drive ultimately strategic you priorities over TDS we returns market in the to of help will goal serve. areas improved us see Telecom's preferred strengthening achieve that financial position. broadband focus and the strategic and time, provider be our will in our these profitability can markets

XX. Slide Moving to

on our you results each The goals. longer-term and on I and consistently update achieving can At on monitor quarter making XXXX, towards for follow towards on X me we these you shared report we first the so is we're our headline progress Let will goals. that progress based track. quarter metrics expectations our that year-end, remain

by deployed we to XX,XXX confident and track mentioned, that remain addresses service the XXX,XXX we're in year-end. previously As we on quarter, marketable reach

the addresses a reminder, Northwest are build delivery are winter expansion throughout in months our of that down the weather markets and year. steadily most will so Pacific service during where slows expectations Wisconsin, As our

well we XXXX. and XX% quarter of progress marketable on also total fiber metrics. share expansion So markets be million addresses markets. we as addresses with incumbent the me our targeting by as targeting program up where service by mark. XXX,XXX, We XXXX are fibering XX%. growing we're with service so ended through fiber This We're the our our served the to in by fiber ended quarter at halfway let our over reflects X.X fiber We're

higher offer we expecting serve ILEC footprint finished to fibered speeds. at our Specifically, with by with GB plan addresses of X XXXX. the the quarter, at GB XXXX, at our XX% we're finally, end fiber. the quarter And X to our up. And or speeds to of XX% of ILEC half XX% of was least We by

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

around builds still service The scaling We continue to it. at this and to our contributions launched getting achieve rates returns. address Based our XX% have market expect from the and penetration success steady navigate positive We've mark, in business launches of program on our still been of process and state. since we low we successfully repeatable experience, that expand deployment seen cases as our challenges starting a completed. least markets we've in early our in mid-double-digit validates we up to in our we see X-year our expectation a place broadband

you XX, that Slide can is our journey. On fiber multiyear program a see

in stages We've these or X% in Successfully growth ramping development, in are year that total communities service is of an most seen up this to longer-term towards with XXX key about hitting have addresses XXXX our construction. year-over-year. construction about goals. various begin We of

obligations We the the FCC needs hopefully, in It most quarter. our grant adopting meeting also and the is our copper support moving to that address of extension our federal by third under programs A-CAM toward continue our state program. rural the A-CAM by broadband by program, an broadband understanding from networks is with markets upgrading

additional same down of support speeds up. speeds The would of BEAD. The an A-CAM XXX years X and as provide extension for XX

this For almost our of XXX,XXX to fiber addresses. means A-CAM us, getting all

we and an pursuing federal the into the to We our BEAD Telecom are fastest path funding A-CAM very then extending current program first because that take program be about A-CAM TDS for would fiber extension enthusiastic deeper believe communities.

Our are positive results. broadband driving investments

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

Telecom plus In service, to And product. total of seeing now on XX% speeds. service generated now GB an this customers even finally, TDS where residential X of has footprint. taking offer can GB GB reliable X offer revenue. broadband our in we fast our offering we're at markets, its areas service X% least In X we're new focus some XX% increase

revenues On in of an residential Slides This commercial increased I'll which made XX, were by for line financial the quarter. and expectations. share offset X% increase in highlights, X% and some in XX revenues, our decrease is wholesale. up with Total a increase

price across connection product quarter. revenues for by our markets all Residential up of X% offset increased due mix, also was the Average and overall residential to per partially X% increases promotions. revenue

voice video broadband due connections. new decline these and and connections address shown $XX in increases our in in revenues incumbent markets residential revenues steady to increased quarter. left, Residential partially expansion the in This and with a of by of following penetrations revenue in growth activity up aligns chart growth on were market million the timing As as the to service and promotional build. wireline year-over-year cable offset delivery price the expectations

X% primarily CLEC revenue. primarily And driven the special lower quarter, connections. in access quarter, revenues the for wholesale lastly, decreased revenues decreased X% to due by Commercial lower

XX% Cash our the in expenses quarter, fiber due growing mainly increased program. to

to a generating reminder, as marketing, As direct upfront revenues. services. in are shared estate incurred expansion our These support and to fiber markets costs to launching and addition cost prior real costs such technicians include sales,

EBITDA resulted As quarter. XX% cash we decline the in expenses expected, the of in adjusted increased a for

our on these run. free due in and our capital expenditures flow increased and that from the goal over long deployment. investments prior in of fiber strategy were increasing Capital investment the cash return $XXX million of up Keep year multiyear support mind to

which guidance, to and plans. On Slide is tracking unchanged is are our we as XXXX XX our

to of billion. all markets, goal top total forecasting revenues. across telecom and improvements billion by are commercial This We driven in continued growth reflects revenues our $X.XX $X.XX of revenues declines in offsetting of line wholesale our residential

reflects in Adjusted XXXX. all Adjusted to of end be spending. $XXX the launched. our been million have expected expansion, communities XXXX, EBITDA XXX At will fiber our $XXX million which of continued requires EBITDA almost to is upfront between

penetration, we expect the our and to over market on pressure adjusted we increase EBITDA time. our builds lessen As mature

$XXX service million allocated spend spending on expected growth. capital be million are $XXX broadband of is increased XXXX. between delivery, expenditures our Capital This in fiber nearly and and to to XX% reflects

over for our want strategy. turning thank Before team entire the all alignment I to on and the call, our their hard execute mission. work organization of It dedication to the to takes continued across

Telecom's success. is So contributing associates TDS each to one our of

I'll back now call the to Colleen. turn

Operator, Okay. ready question. first we're for the

of [Operator from Instructions] is James. question Your Prentiss Rick first Raymond

Yes. of couple A questions. Yes.

you the as at want in see allocation as you the is looking TDS to years First, any I leverage are as which 'XX. How capital Cellular of that capital Vicki, at still sheet very the tower business, that us dividend maybe. allocation the focus securitizing understand, Telecom, doing and of and and mentioned want help to well. at? you look investment you viewing Where U.S. be level goes far seems on both to possibly consideration balance at

Okay. A questions couple of there.

start me strategy. with first capital Let allocation

I we investments have -- and the feel we the new that businesses, Just footprint and to we've needs to in this shareholders. with timing the heavy investment looking year, markets both and modernization across of about as and of cycle, important a years, significantly XG our at our U.S. and last pacing Telecom. are last talked expansion year, leverage we our at into our of XXX balance approximately TDS Cellular with are deployment C-band couple broadly, those But with and the the the are dividends

with manage really to well manage we credit it's working look safety manage under leverage, our I our at balance. as requirements. And within our are looking And covenants rating -- net. debt a significant to So are we

into pacing balancing that business. the we're back the of investments And our with so

let's then see. And

towers. You broadly assets contributes to I a second more had strength our the strength. about it question gives And also our that towers, balance noncore gives and on think and If sheet business.

So we balance a and the towers part operation. to it talked about lot but gives And us of its Cellular the sheet as core a the importance U.S. strength. --

I liquidity monetize sufficient sheet. would not but XXXX to needing have I for would that -- them, if XXXX, needed I sources So you for -- those and sufficient I balance will the tell not but on we have I'm anything have we

long strong ago, increased dividend. so, year still Okay. that the row to paying commitment And the a XXth what, dividend was I think, in so or not a

We a to paying commitment dividend. strong have very the

We we we're and proud have a which this modestly long track that increasing it, of, did record very focused are we on year.

Okay.

as Second question partnerships for been for return It's update as us far maybe LT, But as several that partnerships me. help it's could to fruition. you mentioned years. them to in difficult there opportunities there, out you're you Obviously, environment at the when be capital. on bringing far where out what are as there. business joined, been potential a

partnerships -- I founded the on the for of concept Yes, remain opportunity two is concepts. and partnerships

in XG, the to which or starting density, if me intensity to perspective, capital whole case the a X is intensity for site a challenging that support multiple given think us. be The first is the as make my XG, talked not X sense. the rural to our building also about It's you industry capital in duplicative case required place. networks for does It's doesn't it concept second upon it's America, challenges concept is sense make about, that founded for is And the simply in network let alone the density competitors. duplicative,

into the can't And specifics. continue conversations players industry. in so Obviously, I get with to have we

general there's think principles. agreement those founding two I upon

micro sense real but it's can on at is assets this. a things the an market a interesting tower just are that people operator, because that do you market the can we tower people well. business, as we we example, gives we're other use, don't estate of we about and tower about those have also One can how one In that our interesting Rick, example, very thinking it

things those so sorts of would shelters And you that those are and generators core expect. and

The backhaul. is interesting one

lot that interest past, piece That have of someone about no seeing sharing those that And means So actually backhaul. that in would conversations a backhaul you, the right? some some had have we've we're there's my concept in to conversations. a I with been with people of sharing share thank else. network And of

those behind I So remain the reasonable. believe partnerships momentum

to I call progress I think To that the haven't think with this. concept. conversations that on and industry. can rationale good underlying point, it's But in folks a report meaningful strategic remains I continue those strategic have still your a out the like sound, we do seen we

Your Sergey is GAMCO question from Dluzhevskiy next Investors. of

is question LT. first for My

had the market the X X mentioned impact offers that year, positive churn quarter months second a are You this you having expected. year effect half of promotions in with you last on and in and that first lag the of as to

of as at you you the based in your you what question tracking regional it the is compared or your of on improvement, markets is, expectation churn trials expected? worse better to that magnitude Is initial My did before? look that kind of some

what And additional for what or working also, be more working on, which recently besides you're terms of in else what you that see in could for been have working churn done? getting you are you and is improving do contract, steps customers obviously

churn. broadly, I quarter better of we've room we've before. trends Thank look still had the But more that lot every I add net the at the momentum quarter pleased go. have if Clearly, you in for a as question. to with XXXX, am had, think about made the progress than on business, I

year, QX -- quarter in net this for add of better be is net as our we adds the have first to In of generally you going from the first results industry, well net QX quarter year. better than down know. adds last

heading business It's the pleased enough. the is add from fast net And the so not perspective, with. I'm direction the in a momentum of business,

that reason with on to the the that saw the we to have improve you I it's to continue somewhat because is We results momentum churn. similar and share

had we took what test So than the been promotions seen we It market. net bit impact of expected. longer our about has in a the

improvements of impact to the and those continue in few consistent, see to improvement had churn right? took improvement a than benefits we as we remain we in drive the our we the we seen is overall that drive churn of terms people hoped of to markets. months in can test so can in But kinds as improvements long more the keep optimistic contracts, that And

right been high about churn going rate a of time. positive as It's in-contract XX%. to type momentum. is we it's to to in maintain as want now Our that long rate We're to in-contract continue see if have

going And of be to so key it. a driver that's

other be The pieces of targeted smart it with are -- and to we have upgrade offers. our

to offers between digital test continue mass those mean targeted than upgrade pulse I and And are we customers. our in by offers. The considerably upgrade and to cohort. better see offers We from out targeted targeted, outreach results

And optimistic the efforts. we those about from so that results get I'm targeted

as same offers, bang get those you targeted better with for the upgrade but get do buck mass your don't You upgrade with bang you offers.

to it. throw mass to It's to upgrade and is lead continue market. tried a what a very an do subscriber me want charge results, way aggressive bottom. And upgrade piece highly between offers, down, super try and we is the there that economic be easier the which the equation, to on my to continue balance you to that necessarily drive is competitive brings disciplined strike. the And don't highly of is market. a be churn which in money do market, competitive just offers more to to this last last at -- in Yes, to We've

balance that disciplined results subscriber what ARPU. the the we've and is do think in and the results you in tried financial so And between to see I be

net improvement ARPU. about pretty on You rate our that ARPU of intense and rolling out in see a in we in flat earlier, of which, the in competitive as some face continued effect the talked pressures has dilutive face

gives affecting some results trying you Sergey, those momentum. some keep about that make that we're pull going. seeing. it to how we hopefully got sense, it that and Good the to how thinking sure and we're We've the are So levers about of we're

it year-over-year, by, were X,XXX feature question adds up gross front. it. X-part X%. add think, but on the add Handsets The Got gross X% gross gross driven was Maybe phone My largely second increase is adds. question. I a down in smartphone

And the that is few have, and of different increasing what over geographies across the some quarters? for could of number more other where you tend are you underperforming do that reason And over broadly, gross you if that there markets First, be past any are now? your quarters? different past better size what of look lessons are applied right markets phones to learned of feature to the characteristics markets adds the few terms common second, in

first customers Sergey, occurring see Yes, have respect our on the success, flat on phone is the your question rate one feature we to thing of with to migrating prepaid that that are part some over been plan. our plans,

phones why our this the flat and first X,XXX feature first to that prepaid the in So that's smartphones between you're and in migrated That a dynamic rate year, quarter. customers quarter of postpaid seeing plans. counts as postpaid add gross

second of Sergey, terms your And in characteristics. I'll tackle market question

we it perception. We see don't we demonstrated in in right? we subscriber find where we network, actual When won't XG, performance roll generally perspective. Markets improvements shocking, You customer We a improvements see strong do in perception. well a just improvements from performance. see have out

we results. upgraded subscriber to where network, And our see so tend better have we

our two upgrading network, think By can ways. of you in that

The first way is modernizing the XG.

I we not because traffic, metric XG. is to over mentioned our move a I to XG, the as that that but handset. it mentioned traffic that we're been that's requires XG my percentage XX% XG-enabled tower. rides to now of tower, following percentage it upgraded what's it's that has As signal of on have XG customers tower in as the a what's key upgrade to upgrade earlier handsets, also rides traffic comments, the Because you a over that total of a total you requires you only know, getting

to how and network invested, those feel made how we've We our about good how XG. we've upgraded we've investments

improve next of network pivot The our continuing in is to with mid-band. terms

we And begun Defense this we at mid-band the well the but of X.XX of to deployment are the spectrum we end of that light be to so that we now, up able that deploying the expect up from we've spectrum C-band spectrum. purchased year. Department light Right can only as

able think reported, have FAA. to we we interference I As clear concerns the been any we've with

of about us we And have good on the the so benefit believe ahead, ability drive for one churn Sergey, that light helps And compelling that and gross customers. the network that spectrum an adds more? our Go more feel side to side. we'll even our subscriber performance offering so both up, deploy and as we we

pressure is question Basically, obviously Yes. expected, US still. turnaround but Vicki. that under stocks longer obviously, obviously it's competitors while question. shoots, Last USM taking taking One green Cellular and mean, sit been longer for I for than than expected. more have some don't see TDS and operational we time

So TDS surface that, potentially value additional that and or general, moves from a what financial with to broaden for around in growth, of collection US strategic you could capital to underappreciated that given have allocation invest Cellular portfolio considered your in with capital also assets just and all flexibility? significant provide engineering you

we're it that pressuring in at both businesses. heavy that, Michelle cash -- free balanced focused and the that, we our objectives are the right the you, have returns question. allocating and is near making resource a in Doug have investments said our flow on stock that to outlined, Thank Having and Yes. LT investments as and very weighing getting had profitability pressure capital, as Sergey, saw now, answered we're our for our our allocation, are and before, is constantly we under and a as I strategic we has term. the we're our outlined, we as approach and decline

future is investments, growth we over very trying goal. time. However, both businesses position returns focused on improved are that to for And our these and

strong got talked sheet. I've balance about, a As we've

our balance on financial right engineering if would that option. an we with sheet do assets. those plan perspective, And our assets should and But a something is need from strong to have not XXXX. that for be always We noncore now,

question Simon Stanley. is of from next Morgan Your Flannery

macro companies bit referenced some think higher which talked a don't thing. macro little the you're side across or seeing on of But the good consumer involuntary is call, I monitoring have the you're guess churn. slower just about much things and wonder I if you really a enterprise payments enterprise the or could talk decision-making. wireless. you I or both on and wireline Anything

Nice talked you about your little momentum fixed footprint bring bit you we traction How Help there. a obviously We're seeing to then footprint? that a us T-Mobile. with LT, this on mid-band about go-to-market your mid-band of should across as and scaling Verizon see the the with XG lot at And think wireless. lot a spectrum.

into that to by a broadband the or how some do pushback So for how of point? beyond the wireless you XXXX address about the inability handle concerns company? flow certain the kind of will traffic And

there. lot from the I'll perspective. tackle A Cellular Doug Thanks, U.S. macro have the Simon.

mentioned wireline. You

telecom I'll Michelle perspective, macro tackle about So wireless. question the have then Doug? and from your I'll answer fixed

pressure generally Yes. say so mean, as inflation But continued higher our and recession on rates I Simon, this year. there's and quite side, we're I debt managing would with macro bad later potential well. the payments

If you look it's billion at $XX flat at actually year-over-year for debt quarter. expense, our this bad

defect up and went Our slightly. involuntary weight churn the up very per involuntary went slightly

some period. there. ID it pressure the and twice taken locking well We time action including our some monitoring taking last measures, We've credit in spending We're tightened scanners of is antifraud fourth in device the enhance as a lot specifically. ID extending scanners quarter and So year. as there stores of

All are to debt. to XXXX in us of those it as relates help bad going

but good now. the to watch and at about Certainly, manage we well right we're where point feel given continue macro environment, it

Simon, it's Michelle.

the it telecom take Yes. I'll So from side.

most at from back already bad year. payments, gotten So the the that we're of perspective, our We on debt had levels. pre-pandemic customer expense, last operating to

trending just normally for are things So us.

not concerns any So there. really

you sure were some us order that. taking make management were a in We of that any to sure needed materials chain we successful year, and did with chain delay to supply not doing hear lot our had that, in We the did builds. make that's of prebuying supply our fiber very to actions about XXXX to Last a concerns talk team. we shout out that in and we

at seeing constraints loosen this we're So -- supply a bit. point, chain of some little the

hope the risk supply chain positioned XXXX. year some we start in able done. had same see pre-buying well coming that don't in this to utilizing just of And, And really to were We going so we fact, that be forward. into

our we do certain of business. costs In in inflation, see higher terms areas of some

worked process I builds, ways to and related are there cost talked consistently targeting relates and higher with to more costs about some implementing our think it our lowest we efficiently, sure those build. As materials, fiber increases have but to builds to we're labor find more before, out design some to the I've mitigate improvements figuring and making ways network to effectively of areas this cost

case put in projects cost out So, to expectations that mitigating costs. the higher on business returns and overall we're far, of to we those our able get those the fiber, of some some maintain we case business increases so to areas offset of certain though expect because initiatives there's the related to even been

the interest Vicki, perspective? talk sure, not at about if want from I'm to macro So you rates all

Yes. I Fed. by saw we an another increase, mean, the increase certainly, modestly

I our our I very debt, fixed shared the in more $XX that X% and variable I've expense. for about every increase between it's think think you our we've the with into built with rates, projections. interest I'm comfortable in But of and million balance got portions

let fixed And your Simon, me based question. on tackle wireless

very with I we've briefly. the mentioned in Like reiterate are it comments, seen in We but the product. that momentum I'll just before pleased

year. continued June two that expand of We have do interesting footprint-wide until didn't product we One, last catalysts.

looking so as grow terms And have still our as additionally, feel about paying because to meaningfully higher it a only We footprint. in satisfy of on is bring deliver not growth. which that attention entire to experience. ability good you're but an have certainly mid-band issue far And to, an year-over-year we we also start QX our ability at we across we're spectrum, to speed capacity,

ability areas effectively have not to in in And and maybe right now. so compete really we areas compete that we're touching the

opportunity and about a network thing and focusing to differently rollout creates customers. And our interesting than sustained creates a we're more rural bit competitors. different that and our opportunity on think more is that's it's our it little rural I an The it areas also manage

dynamic. see and can DSL, with you First, primarily satellite, low-band with our it. it's in been product driving a different competes now, Right very competitive the growth we've that

cable against against upgraded roll plan, aren't we competing provider. cable even be only but mid-band, when not their plan those out with cable an When upgraded happy people we'll technologies,

aggressively and fiber. be don't is view We it's distributing we the or this rural this plan in one thing don't competitive product where We areas else. pretty right? perspective. marketing been to -- against The trying particularly manageable past, there areas in you And this do fiber. about about I've plan going go-to-market, existing we aggressively place product where as about asked clear there's not being the But marketing doing nice capacity a to is or from it everywhere on more do is the plan other in market on

Fixed to going something to wireless a lot have is Capacity certainly attention to. get we're pay of subscribers still

less wireless [Audio competition dense tower, fixed you also Gap] But have a mobility subscriber of then with have a utilizing off when less product. your you base,

capacity of fashion. And more so an you can in demands bit manage a a targeted those elegant in

And so be right we with plan the now, to full our product. continue ahead speed is

continue distribute entire expect we're to bullish seeing. what on remain to our footprint, We it we across and really

wireless. helpful, really that's fixed both So on macro and the the

something. at you're, XX I million just or POPs So think what, --

wireless more will XX half So XG million those, households. of those and year? that think half to with than maybe is that, have fixed fair And you million next to that's XX of

math. the trying bouncing on got... you've the ball to I'm follow Doug,

Yes.

it's over XX time And continue build-out. over frankly, we're Simon, that about We're That's a million starting to be going the entire over going now, mid-band, to with going XX right probably, expand way based this it to more homes. those of million year not will get mid-band mean, But homes we coverage respect again, to low-band, all that's propagates. our I footprint. homes to So -- With And covers on multiyear. time. get rollouts. them to our multiyear to

[ ] from Citadel. of Lidka Your Tom next question is

for XX and to purchased it lost stock of a the years, I'm been come. my XX future makes half And this can a enthusiastic because the these larger $XX.XX. here, if wondering XX-year a And I've explain if don't the run let is this to system some don't sense And in point, years and wonder at I've results, presentation for put headed assets someone they low. up shareholder at company I to to stock And later, I sale money. we're me? know I've be listened more where at efficiently I and seem

in you're and [ of for it's strategic that a Tom I terms you appreciate asked shareholder be appreciate Certainly before long. options continue questions evaluate to that certainly We asking questions you LT. they so us. the sticking with or being for been ], things we've business. we

not I see been to and for us for think a long-term XG reflected use but now. believe intensity that the to themselves. in produce the that's whole I those And right business, cases we of created have place And deliver people the performance business. in invested have Lots the slow in equity. to an wireless It's lot you of manifest as this our pressures, of -- industry future capital capital the do believe is We a of think and interesting just competitors. in

in assets That have this set being strong of we a believe said, very I business.

few have have a that our sheet. the balance so positioned to We we strong better last years have over spectrum holdings. We've -- reset debt

I that the Vicki to think years. believe XG went well-positioned to that it we're support I coming through as begins And emerge that. in demand

as frustration. We course staying shareholder I your because the advantage our a share the understand I take well-positioned think I'm to Obviously, it. so it. we're that question. appreciate in we we're of growth, with strategy I believe And well. and

now Colleen There are call this time. questions at no will I to remarks. closing Thompson the for further over turn

Okay. Thanks, a great weekend. Again, have for reach please to if Have any additional your everyone, time today. IR, out you questions.

call. participation. you This conference your for today's concludes Thank

disconnect. now may You