The following is a summary of the Telephone and Data Systems, Inc. (TDS) Q1 2024 Earnings Call Transcript:

Financial Performance:

• TDS Telecom saw a positive increase in both top and bottom-line growth for Q1 2024, largely driven by multi-year fiber investments.

• TDS borrowed $300 million from a newly secured debt facility, raising the average cost of debt to 6.8%.

• This borrowing is favorable in the current interest rate environment and planned to be directed towards the company's fiber build program.

• First quarter profitability indices like adjusted operating income and adjusted EBITDA increased by 11% and 8% respectively due to a continued successful cost optimization program.

• Despite an expected decline in service revenue for 2024, TDS anticipates that efficiency measures like the shutdown of their CDMA network will keep the adjusted operating income margin relatively stable.

Business Progress:

• TDS Telecom's strategic focus on fiber technology expansion has proven successful, with the strongest quarter of revenues and profitability noted since the program's launch.

• The company aims to drive revenue growth in 2024 through the expansion of broadband penetration in target markets.

• TDS Telecom's mid-band rollout is on schedule, with the expectation to handle almost half of its data traffic.

• In terms of longer-term strategy, the objective is to offer 1 gig or higher speed to at least 80% of the TDS footprint and reach 1.2 million marketable fiber service addresses.

• Investment in areas like advanced network capabilities and private 5G networks in manufacturing and utilities is being pursued, indicating innovative growth strategies.

• The strategy to increase fiber spend shows TDS's defensive move against overbuilders in ILEC markets and their ambition to be competitive with cable companies.

• TDS continues to advocate for fixed wireless investment. This could lower bundle prices, offering a more competitive edge against cable services.

More details: Telephone and Data Systems IR

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