Array Digital Transforms with T-Mobile Deal, Boosts Tower Revenue

TL;DR

**Array's T-Mobile deal is a game-changer, shedding legacy wireless for a focused, cash-rich tower and spectrum play, making it a strong buy for infrastructure bulls.**

AI Summary

ARRAY DIGITAL INFRASTRUCTURE, INC. (UZD) reported a significant strategic shift and financial transformation for the three and nine months ended September 30, 2025. The company, formerly United States Cellular Corporation, sold its wireless operations and select spectrum assets to T-Mobile US, Inc. on August 1, 2025, for a total consideration of $4,293.8 million, comprising $2,628.8 million in cash and $1,665.0 million in assumed debt. This divestiture led to a net loss from discontinued operations attributable to Array shareholders of $147.3 million for the three months ended September 30, 2025, compared to a net income of $16.8 million in the prior year. However, continuing operations saw a net income attributable to Array shareholders of $108.8 million for the three months, a substantial improvement from a $95.9 million loss in the same period last year. Total operating revenues from continuing operations increased by 83% to $47.1 million for the three months, primarily driven by the Master License Agreement with T-Mobile. Equity in earnings of unconsolidated entities surged by 62% to $69.8 million, largely due to a $34.1 million gain from the sale of wireless operations by noncontrolling interest entities. The company also recorded a short-term imputed spectrum lease income of $30.4 million. Array continues to monetize spectrum assets, with pending sales to Verizon, AT&T, and T-Mobile totaling over $2.1 billion.

Why It Matters

This 10-Q filing marks a pivotal transformation for Array Digital Infrastructure, shifting from a wireless carrier to a pure-play digital infrastructure company focused on tower leasing and spectrum monetization. For investors, the T-Mobile divestiture, while causing a short-term loss from discontinued operations, provides significant cash proceeds and debt reduction, potentially improving Array's balance sheet and future profitability from its core tower business. Employees in the divested wireless operations have transitioned, while those in the remaining tower and spectrum management segments will see a refocused strategy. Customers of the divested wireless services are now T-Mobile customers, ensuring service continuity. The broader market sees a consolidation in the wireless sector and a new, specialized player in digital infrastructure, potentially intensifying competition in the tower leasing space with major players like American Tower and Crown Castle.

Risk Assessment

Risk Level: medium — The risk level is medium due to the ongoing strategic alternatives review and the reliance on future spectrum sales. While the T-Mobile deal provided significant liquidity, Array still has $1,591.2 million in retained spectrum not subject to pending sale agreements, and the timing of regulatory approvals for the Verizon, AT&T, and T-Mobile spectrum transactions (totaling over $2.1 billion) is uncertain, with potential impacts from government shutdowns. Additionally, the expected decline in interim lease revenue from T-Mobile prior to the full 30-month duration introduces revenue volatility.

Analyst Insight

Investors should consider Array Digital Infrastructure as a potential long-term hold, focusing on its transition to a digital infrastructure pure-play. Monitor the progress of the remaining spectrum sales and the stability of tower leasing revenue post-T-Mobile interim leases. The significant cash proceeds from the T-Mobile deal could be used for debt reduction, share repurchases, or further infrastructure investments, which should be evaluated.

Financial Highlights

revenue

$47.1 million

net Income

$108.8 million

revenue Growth

+83%

Revenue Breakdown

Key Numbers

• $4,293.8 million — Total consideration from T-Mobile sale (Received for wireless operations and select spectrum assets)
• $2,628.8 million — Cash proceeds from T-Mobile sale (Part of the total consideration received)
• $1,665.0 million — Debt assumed by T-Mobile (Part of the total consideration received)
• $108.8 million — Net income from continuing operations attributable to Array shareholders (For the three months ended September 30, 2025, up from a $95.9 million loss)
• $47.1 million — Total operating revenues from continuing operations (For the three months ended September 30, 2025, an 83% increase)
• 4,449 — Owned towers (As of September 30, 2025, core asset for tower leasing)
• $1,591.2 million — Book value of remaining spectrum (Not subject to pending sale agreements, primarily C-Band spectrum)
• $34.1 million — Gain on sale from unconsolidated entities (Array's proportionate share, contributing to equity in earnings)
• $30.4 million — Short-term imputed spectrum lease income (For the three months ended September 30, 2025, from T-Mobile agreement)
• $20.2 million — Estimated purchase price true-up due to T-Mobile (As of September 30, 2025, subject to final adjustment)

Key Players & Entities

• ARRAY DIGITAL INFRASTRUCTURE, INC. (company) — Registrant, formerly United States Cellular Corporation
• T-Mobile US, Inc. (company) — Buyer of Array's wireless operations and select spectrum assets
• Verizon (company) — Buyer of AWS, Cellular and PCS spectrum licenses from Array
• AT&T (company) — Buyer of 3.45 GHz and 700 MHz spectrum licenses from Array
• Telephone and Data Systems, Inc. (company) — 82.0%-owned subsidiary of Array Digital Infrastructure, Inc.
• New York Stock Exchange (regulator) — Exchange where Array's Common Shares and Senior Notes are registered
• Echostar Communications (company) — Tenant whose site rental revenues could be negatively impacted
• Private Securities Litigation Reform Act of 1995 (regulator) — Defines forward-looking statements

FAQ

Risk Factors

• Sale of Wireless Operations and Spectrum Assets [medium — financial]: The divestiture of wireless operations and select spectrum assets to T-Mobile for $4,293.8 million on August 1, 2025, resulted in a net loss from discontinued operations of $147.3 million for the three months ended September 30, 2025. While this impacts historical performance, the focus shifts to continuing operations.
• Spectrum Monetization and Pending Sales [medium — market]: Array is actively monetizing spectrum assets with pending sales to Verizon, AT&T, and T-Mobile totaling over $2.1 billion. The success and timing of these sales are critical for future cash flow and financial stability.
• Dependence on Master License Agreement [high — operational]: The significant increase in continuing operations revenue (83%) is heavily reliant on the Master License Agreement with T-Mobile. Any disruption or renegotiation of this agreement could materially impact revenue.
• Estimated Purchase Price True-Up [low — financial]: An estimated purchase price true-up of $20.2 million related to the T-Mobile sale as of September 30, 2025, indicates potential for further adjustments to the transaction's financial outcome.

Industry Context

Array Digital Infrastructure operates in the digital infrastructure sector, focusing on tower leasing and spectrum management. The industry is characterized by significant capital investment, consolidation, and evolving demand for data capacity. The recent divestiture of wireless operations positions Array to concentrate on its tower assets and spectrum monetization, aligning with trends of infrastructure specialization.

Regulatory Implications

The company's spectrum assets are subject to FCC regulations. While the sale of wireless operations may reduce direct regulatory burdens related to service provision, ongoing spectrum management and leasing activities will continue to require adherence to telecommunications regulations.

What Investors Should Do

1. Monitor the progress and finalization of pending spectrum sales to Verizon, AT&T, and T-Mobile.
2. Analyze the long-term sustainability of revenue from the T-Mobile Master License Agreement.
3. Evaluate the company's strategy for its remaining tower assets (4,449 owned towers) and non-monetized spectrum.
4. Assess the impact of the $20.2 million estimated purchase price true-up related to the T-Mobile sale.

Key Dates

• 2025-08-01: Sale of wireless operations and select spectrum assets to T-Mobile — Marks a significant strategic shift for the company, formerly United States Cellular Corporation, now Array Digital Infrastructure, Inc. This transaction generated $4,293.8 million in consideration.
• 2025-08-12: Ticker symbol change to 'AD' on NYSE — Reflects the company's new identity and strategic focus as Array Digital Infrastructure, Inc.
• 2025-09-30: End of the nine-month period — Reporting period for the 10-Q, showing substantial changes in operations and financial results post-T-Mobile transaction.

Glossary

Discontinued Operations

A segment of a business that has been sold, abandoned, or is being disposed of. Its results are reported separately from continuing operations. (The net loss from discontinued operations ($147.3 million) highlights the impact of the T-Mobile sale on past business activities.)

Continuing Operations

The parts of a business that are expected to continue operating in the future. Its financial results are reported separately from discontinued operations. (Net income from continuing operations ($108.8 million) shows the improved profitability of Array's core digital infrastructure business post-divestiture.)

Master License Agreement

A contract that grants a licensee the right to use intellectual property or assets, often with broad rights and terms. (This agreement with T-Mobile is the primary driver of the significant revenue increase in continuing operations.)

Equity in earnings of unconsolidated entities

The portion of the profits or losses of companies in which the reporting company has a significant influence but not control, recognized on the income statement. (Surged by 62%, boosted by a $34.1 million gain from the sale of wireless operations by noncontrolling interest entities, indicating value realization from associated companies.)

Imputed Spectrum Lease Income

Income recognized for the use of spectrum licenses that is not based on an actual cash lease payment, often for internal use or related-party arrangements. (The $30.4 million short-term imputed spectrum lease income from T-Mobile reflects the value of spectrum assets being utilized under the new agreement.)

Noncontrolling Interest

The portion of equity in a subsidiary that is not attributable to the parent company. It represents the ownership stake of outside shareholders. (A gain of $34.1 million from the sale of wireless operations by these entities contributed to Array's equity in earnings.)

Year-Over-Year Comparison

Compared to the prior year's period ended September 30, 2024, Array Digital Infrastructure, Inc. (formerly United States Cellular Corporation) has undergone a dramatic transformation. Total operating revenues from continuing operations surged by 83% to $47.1 million, driven by the T-Mobile Master License Agreement, a stark contrast to the prior year's performance. Net income from continuing operations swung from a significant loss of $95.9 million to a profit of $108.8 million, reflecting the successful strategic shift. Equity in earnings also saw a substantial increase of 62%. The company's risk profile has shifted from wireless operations to spectrum monetization and reliance on new licensing agreements.

Key Financial Figures

• $1 — nge on which registered Common Shares, $1 par value AD New York Stock Exchange 6
• $1,591.2 million — subject to pending sale agreements was $1,591.2 million and includes primarily C-Band spectrum.
• $2.4 million — management of the retained spectrum of $2.4 million during the three months ended September
• $4,293.8 million — ment). Total consideration received was $4,293.8 million after adjustments which included a comb
• $2,628.8 million — stments which included a combination of $2,628.8 million in cash proceeds and $1,665.0 million i
• $1,665.0 million — f $2,628.8 million in cash proceeds and $1,665.0 million in debt assumed by T-Mobile through the
• $20.2 million — rchase price true-up due to T-Mobile of $20.2 million . At closing, Array and T-Mobile entere
• $0.5 million — ns and strategic alternatives review of $0.5 million and $2.3 million for the three and nine
• $2.3 million — alternatives review of $0.5 million and $2.3 million for the three and nine months ended Sep
• $1.3 million — d September 30, 2025, respectively, and $1.3 million and $19.9 million for the three and nin
• $19.9 million — 025, respectively, and $1.3 million and $19.9 million for the three and nine months ended Sep
• $5.4 million — gust 1, 2025 MLA commencement date, was $5.4 million. Further, the MLA extends the license t
• $34.1 m — nconsolidated entities in the amount of $34.1 million, which was the primary driver of
• $325.6 million — Array's Cash and cash equivalents were $325.6 million and $143.7 million at September 30, 202
• $143.7 million — ash equivalents were $325.6 million and $143.7 million at September 30, 2025 and December 31,

Filing Documents

• ad-20250930.htm (10-Q) — 1283KB
• ad9302025ex31.htm (EX-3.1) — 9KB
• ad9302025ex311.htm (EX-31.1) — 9KB
• ad9302025ex312.htm (EX-31.2) — 10KB
• ad9302025ex321.htm (EX-32.1) — 5KB
• ad9302025ex322.htm (EX-32.2) — 5KB
• ad-20250930_g1.jpg (GRAPHIC) — 111KB
• ad-20250930_g2.jpg (GRAPHIC) — 106KB
• ad-20250930_g3.jpg (GRAPHIC) — 578KB
• 0000821130-25-000070.txt ( ) — 8633KB
• ad-20250930.xsd (EX-101.SCH) — 39KB
• ad-20250930_cal.xml (EX-101.CAL) — 72KB
• ad-20250930_def.xml (EX-101.DEF) — 332KB
• ad-20250930_lab.xml (EX-101.LAB) — 611KB
• ad-20250930_pre.xml (EX-101.PRE) — 468KB
• ad-20250930_htm.xml (XML) — 666KB

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 24

Financial Statements (Unaudited)

Financial Statements (Unaudited) 25 Consolidated Statement of Operations 25 Consolidated Statement of Cash Flows 27 Consolidated Balance Sheet 28 Consolidated Statement of Changes in Equity 30

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 34

Controls and Procedures

Controls and Procedures 44

Legal Proceedings

Legal Proceedings 45 Unregistered Sales of Equity Securities and Use of Proceeds 46 Other Information 47 Exhibits 48 Form 10-Q Cross Reference Index 49

Signatures

Signatures 50 Table of Contents Array Digital Infrastructure, Inc.

Management's Discussion and Analysis of

Management's Discussion and Analysis of Financial Condition and Results of Operations Executive Overview On August 1, 2025, United States Cellular Corporation changed its name to Array Digital Infrastructure, Inc. (Array). Array is used throughout this report even when referring to historical periods. On August 12, 2025, the Array Common Shares ticker symbol on the New York Stock Exchange changed to "AD". The following discussion and analysis compares Array's financial results for the three and nine months ended September 30, 2025, to the three and nine months ended September 30, 2024. It should be read in conjunction with Array's interim consolidated financial statements and notes included herein, and with the description of Array's business, its audited consolidated financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) included in Array's Annual Report on Form 10-K (Form 10-K) for the year ended December 31, 2024. Certain numbers included herein are rounded to thousands or millions for ease of presentation; however, certain calculated amounts and percentages are determined using the unrounded numbers. This report contains statements that are not based on historical facts, which may be identified by words such as "believes," "anticipates," "estimates," "expects," "plans," "intends," "projects," "will" and similar expressions. These statements constitute and represent "forward looking statements" as this term is defined in the Private Securities Litigation Reform Act of 1995. Such forward looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, events or developments to be significantly different from any future results, events or developments expressed or implied by such forward looking statements. See the disclosure under the heading Private Securities Litigation Reform Act of 1995 Safe Harbor Cautionary Statement elsewhere in this report

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