Telephone and Data Systems, Inc. has recently released its 10-K report for the year ended December 31, 2024. The company is a telecommunications provider operating through two segments: UScellular and TDS Telecom, offering wireless solutions, Internet of Things (IoT) services, and software applications. As of the end of 2024, TDS served approximately 5.5 million connections nationwide.
In its 10-K report, the company's Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) highlighted several key financial matters. Notably, TDS reported a net loss attributable to common shareholders of $97 million for 2024, which included a non-cash charge related to the impairment of certain wireless spectrum licenses. This impairment charge amounted to $136 million, with a net tax impact of $102 million. In comparison, the net loss in 2023 included a non-cash charge related to the TDS Telecom Goodwill impairment of $547 million, with a net tax impact of $511 million.
Furthermore, the report discussed the company’s ongoing strategic alternatives review process for UScellular. In 2024, TDS and UScellular announced the planned disposal of UScellular's wireless operations, and subsequently, entered into agreements to sell certain wireless spectrum licenses to T-Mobile, Verizon, and AT&T. The sale of UScellular's wireless business to T-Mobile is expected to close in mid-2025, subject to regulatory approvals and customary closing conditions. The company also disclosed that it incurred third-party expenses related to the announced transactions and strategic alternatives review, amounting to $56 million in 2024, significantly higher than the $13 million incurred in 2023.
The report also provided insights into TDS' mission, strategy, and capital allocation approach. TDS’ mission is to provide outstanding communications services while creating opportunities for its associates, supporting the communities it serves, and building long-term value for its shareholders. In the second quarter of 2024, TDS reset its approach to capital allocation, declaring dividends at approximately 20% of the first quarter of 2024 dividend for TDS Common and Series A shares, with the aim of freeing up additional capital to support TDS' fiber program and other purposes.
Additionally, the MD&A outlined the company's use of certain non-GAAP financial measures, such as EBITDA and Free Cash Flow, providing definitions and explanations for these metrics. The market has reacted to these announcements by moving the company's shares -4.9% to a price of $37.69. For more information, read the company's full 10-K submission here.
