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Telephone and Data Systems, Inc. TDS posted strong fourth-quarter 2024 results, with both top and bottom lines beating the respective Zacks Consensus Estimates. TDS reported a revenue decline year over year, owing to demand softness in the U.S. Cellular vertical.
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However, solid growth in residential broadband connections partially cushioned the top line. TDS Telecom deployed 129,000 marketable fiber addresses in 2024. Management’s focus on cost optimization is driving profitability.
Net Income of TDS
On a GAAP basis, the company reported a net loss of $11 million or 10 cents per share compared with a net loss of $523 million or $4.64 in the year-earlier quarter. Despite top-line decline, cost discipline and lower operating expenses in the TDS Telecom segment led to narrower loss during the quarter.
On a non-GAAP basis, the company reported a net loss of $10 million or a loss of 9 cents per share compared with a loss of $12 million or 11 cents in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate by 23 cents.
In 2024, the company reported a GAAP net loss of $97 million or a loss 85 cents per share compared with a loss of $569 million or $5.06 in 2023. Non-GAAP net loss was $12 million or 11 cents per share compared with a loss of $59 million or 53 cents in 2023.
Telephone and Data Systems, Inc. Price, Consensus and EPS Surprise
Telephone and Data Systems, Inc. price-consensus-eps-surprise-chart | Telephone and Data Systems, Inc. Quote
Revenues of TDS
Net sales in the quarter were $1.24 billion, down from $1.31 billion reported in the year-ago quarter. Declining revenues in the U.S. Cellular segment affected the top line. However, the figure beat the Zacks Consensus Estimate by $14 million.
In 2024, the company generated $4.96 billion in revenues, down from $5.2 billion in 2023.
Revenues from U.S. Cellular were $970 million, down 3% year over year. A reduction in postpaid retail and prepaid connections impeded the top line. However, growth in fixed wireless customers and tower revenues are positive factors. Net sales beat our revenue estimate of $922 million. Total cash expenses were $811 million, marginally down from $812 million in the prior-year quarter.
The company reported an Operating loss of $9 million against an income of $21 million registered in the year-ago quarter. Postpaid average revenues per user (ARPU) rose to $51.73 from $51.61. Postpaid average revenues per account decreased to $131.10 from $131.63 in the year-ago quarter. Prepaid ARPU was $30.59, down from $32.32 in the prior-year quarter.
TDS Telecom contributed $264 million to revenues compared with $261 million reported in the prior-year quarter. The top line fell short of our estimate of $266.9 million. Total residential connections were 935,600, down from 952,900 in the year-earlier quarter. Residential revenues per connection were $64.72, up from $62.74 in the prior-year quarter.
Total cash expenses were $187 million, up 1% year over year. Around 22% of customers opted for 1 Gigabit+ speed compared with the prior-year quarter’s tally of 16%. About 11% of users have chosen 600 Mbps speed compared with 9% in the year-earlier quarter. Its broadband expansion rose to 126,100 from 92,200 a year ago. Total connections were 1,126,100 compared with 1,163,100 in the year-ago quarter.