Business Segment Information (Tables)

6 Months Ended

Jun. 30, 2021

Financial data for TDS’ reportable segments for the three and six month periods ended, or as of June 30, 2021 and 2020, is as follows. See Note 1 — Basis of Presentation for additional information.


Three Months Ended or as of June 30, 2021	UScellular		TDS Telecom		Corporate, Eliminations and Other		Total
(Dollars in millions)
Operating revenues
Service	$	774	$	251	$	24	$	1,049
Equipment and product sales	240		—		22		262
Total operating revenues	1,014		252		45		1,311
Cost of services (excluding Depreciation, amortization and accretion reported below)	204		101		19		324
Cost of equipment and products	258		—		18		276
Selling, general and administrative	334		73		9		416
Depreciation, amortization and accretion	180		49		5		234
(Gain) loss on asset disposals, net	2		1		—		3


Operating income (loss)	36		28		(6)		58
Equity in earnings of unconsolidated entities	47		—		1		48
Interest and dividend income	2		—		1		3

Interest expense	(60)		1		(27)		(86)

Income (loss) before income taxes	25		29		(31)		23
Income tax expense (benefit)	(10)		7		(8)		(11)
Net income (loss)	35		22		(23)		34
Add back:
Depreciation, amortization and accretion	180		49		5		234
(Gain) loss on asset disposals, net	2		1		—		3



Interest expense	60		(1)		27		86
Income tax expense (benefit)	(10)		7		(8)		(11)
Adjusted EBITDA1	$	267	$	78	$	1	$	346

Investments in unconsolidated entities	$	445	$	4	$	38	$	487
Total assets	$	9,920	$	2,433	$	427	$	12,780
Capital expenditures	$	148	$	99	$	3	$	250


Three Months Ended or as of June 30, 2020	UScellular		TDS Telecom		Corporate, Eliminations and Other		Total
(Dollars in millions)
Operating revenues
Service	$	753	$	240	$	23	$	1,016
Equipment and product sales	220		—		27		247
Total operating revenues	973		241		49		1,263
Cost of services (excluding Depreciation, amortization and accretion reported below)	197		92		17		306
Cost of equipment and products	218		—		23		241
Selling, general and administrative	323		66		9		398
Depreciation, amortization and accretion	178		51		7		236

(Gain) loss on asset disposals, net	4		—		—		4


Operating income (loss)	53		31		(6)		78
Equity in earnings of unconsolidated entities	44		—		—		44
Interest and dividend income	1		1		—		2
Interest expense	(25)		1		(14)		(38)

Income (loss) before income taxes	73		33		(20)		86
Income tax expense (benefit)	4		5		(1)		8
Net income (loss)	69		28		(19)		78
Add back:
Depreciation, amortization and accretion	178		51		7		236

(Gain) loss on asset disposals, net	4		—		—		4


Interest expense	25		(1)		14		38
Income tax expense (benefit)	4		5		(1)		8
Adjusted EBITDA1	$	280	$	83	$	1	$	364

Investments in unconsolidated entities	$	445	$	4	$	37	$	486
Total assets	$	8,500	$	2,210	$	451	$	11,161
Capital expenditures	$	168	$	75	$	4	$	247



Six Months Ended or as of June 30, 2021	UScellular		TDS Telecom		Corporate, Eliminations and Other		Total
(Dollars in millions)
Operating revenues
Service	$	1,545	$	500	$	46	$	2,091
Equipment and product sales	492		1		45		538
Total operating revenues	2,037		501		91		2,629
Cost of services (excluding Depreciation, amortization and accretion reported below)	389		199		35		623
Cost of equipment and products	533		—		37		570
Selling, general and administrative	639		143		22		804
Depreciation, amortization and accretion	350		98		9		457
(Gain) loss on asset disposals, net	7		1		—		8
(Gain) loss on sale of business and other exit costs, net	(1)		—		—		(1)

Operating income (loss)	120		60		(12)		168
Equity in earnings of unconsolidated entities	88		—		2		90
Interest and dividend income	3		—		3		6

Interest expense	(97)		2		(43)		(138)
Other, net	—		—		(1)		(1)
Income (loss) before income taxes	114		62		(51)		125
Income tax expense (benefit)1	17		15		(12)		20
Net income (loss)	97		46		(38)		105
Add back:
Depreciation, amortization and accretion	350		98		9		457
(Gain) loss on asset disposals, net	7		1		—		8
(Gain) loss on sale of business and other exit costs, net	(1)		—		—		(1)


Interest expense	97		(2)		43		138
Income tax expense (benefit)1	17		15		(12)		20
Adjusted EBITDA2	$	567	$	158	$	2	$	727

Capital expenditures	$	273	$	169	$	4	$	446



Six Months Ended or as of June 30, 2020	UScellular		TDS Telecom		Corporate, Eliminations and Other		Total
(Dollars in millions)
Operating revenues
Service	$	1,515	$	480	$	47	$	2,042
Equipment and product sales	422		1		59		482
Total operating revenues	1,937		481		106		2,524
Cost of services (excluding Depreciation, amortization and accretion reported below)	377		188		34		599
Cost of equipment and products	435		—		52		487
Selling, general and administrative	659		130		20		809
Depreciation, amortization and accretion	354		103		13		470

(Gain) loss on asset disposals, net	8		—		—		8


Operating income (loss)	104		59		(12)		151
Equity in earnings of unconsolidated entities	89		—		1		90
Interest and dividend income	5		4		(1)		8
Interest expense	(49)		2		(28)		(75)
Other, net	—		(1)		—		(1)
Income (loss) before income taxes	149		64		(40)		173
Income tax expense (benefit)1	8		8		(4)		12
Net income (loss)	141		56		(36)		161
Add back:
Depreciation, amortization and accretion	354		103		13		470

(Gain) loss on asset disposals, net	8		—		—		8


Interest expense	49		(2)		28		75
Income tax expense (benefit)1	8		8		(4)		12
Adjusted EBITDA2	$	560	$	165	$	1	$	726

Capital expenditures	$	405	$	128	$	6	$	539

Numbers may not foot due to rounding.

1Adjusted 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.