Revenue Recognition

6 Months Ended

Jun. 30, 2022

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 June 30, 2022	UScellular		TDS Telecom		Corporate, Eliminations and Other		Total
(Dollars in millions)
Revenues from contracts with customers:
Type of service:
Retail service	$	700	$	—	$	—	$	700
Inbound roaming	18		—		—		18
Residential	—		168		—		168
Commercial	—		44		—		44
Wholesale	—		44		—		44
Other service	42		—		19		61
Service revenues from contracts with customers	760		255		19		1,035
Equipment and product sales	244		—		41		285
Total revenues from contracts with customers	1,004		255		60		1,320
Operating lease income	23		1		6		29
Total operating revenues	$	1,027	$	256	$	66	$	1,349

Three Months Ended June 30, 2021	UScellular		TDS Telecom		Corporate, Eliminations and Other		Total
(Dollars in millions)
Revenues from contracts with customers:
Type of service:
Retail service1	$	684	$	—	$	—	$	684
Inbound roaming	28		—		—		28
Residential	—		160		—		160
Commercial	—		46		—		46
Wholesale	—		44		—		44
Other service1	42		—		18		60
Service revenues from contracts with customers	754		251		18		1,022
Equipment and product sales	240		—		22		262
Total revenues from contracts with customers	994		251		39		1,284
Operating lease income	20		1		6		27
Total operating revenues	$	1,014	$	252	$	45	$	1,311

Six Months Ended June 30, 2022	UScellular		TDS Telecom		Corporate, Eliminations and Other		Total
(Dollars in millions)
Revenues from contracts with customers:
Type of service:
Retail service	$	1,402	$	—	$	—	$	1,402
Inbound roaming	39		—		—		39
Residential	—		330		—		330
Commercial	—		87		—		87
Wholesale	—		87		—		87
Other service	84		—		36		120
Service revenues from contracts with customers	1,525		505		36		2,065
Equipment and product sales	467		1		71		539
Total revenues from contracts with customers	1,992		506		107		2,604
Operating lease income	45		2		13		60
Total operating revenues	$	2,037	$	507	$	120	$	2,664

Six Months Ended June 30, 2021	UScellular		TDS Telecom		Corporate, Eliminations and Other		Total
(Dollars in millions)
Revenues from contracts with customers:
Type of service:
Retail service1	$	1,367	$	—	$	—	$	1,367
Inbound roaming	56		—		—		56
Residential	—		317		—		317
Commercial	—		93		—		93
Wholesale	—		89		—		89
Other service1	81		—		34		115
Service revenues from contracts with customers	1,504		499		34		2,037
Equipment and product sales	492		1		45		538
Total revenues from contracts with customers	1,996		499		79		2,575
Operating lease income	41		1		12		54
Total operating revenues	$	2,037	$	501	$	91	$	2,629

Numbers may not foot due to rounding.

1For the three and six months ended June 30, 2021, amounts have been adjusted to reclassify $2 million and $4 million, respectively, of Internet of Things (IoT) and Reseller revenues from Retail service to Other service.

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.

	June 30, 2022		December 31, 2021
(Dollars in millions)
Contract assets	$	9	$	10
Contract liabilities	$	303	$	289

Revenue recognized related to contract liabilities existing at January 1, 2022 was $171 million for the six months ended June 30, 2022.

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 June 30, 2022 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 2022	$	277
2023	216
Thereafter	186
Total	$	679

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:

	June 30, 2022		December 31, 2021
(Dollars in millions)
Costs to obtain contracts
Sales commissions	$	134	$	139
Fulfillment costs
Installation costs	9		10
Total contract cost assets	$	143	$	149

Amortization of contract cost assets was $28 million and $57 million for the three and six months ended June 30, 2022, respectively, and $29 million and $59 million for the three and six months ended June 30, 2021, respectively, and was included in Selling, general and administrative expenses and Cost of services expenses.