Segment Information

6 Months Ended

Jun. 30, 2024

Segment Reporting [Abstract]

Segment Information

Segment Information

Our management, including our chief executive officer, who is our chief operating decision maker, manages our operations as two reportable segments, in addition to our corporate operations, which include:

Uniti Leasing: Represents the operations of our leasing business which is engaged in the acquisition and construction of mission-critical communications assets and leasing them to anchor customers on either an exclusive or shared-tenant basis, in addition to the leasing of dark fiber on our existing dark fiber network assets that we either constructed or acquired. While the Leasing segment represents our REIT operations, certain aspects of the Leasing segment are also operated through taxable REIT subsidiaries.

Uniti Fiber: Represents the operations of our fiber business which is a leading provider of infrastructure solutions, including cell site backhaul and dark fiber, to the telecommunications industry.

Corporate: Represents our corporate office and shared service functions. Certain costs and expenses, primarily related to headcount, information technology systems, insurance, professional fees and similar charges, that are directly attributable to operations of our business segments are allocated to the respective segments.

Management evaluates the performance of each segment using Adjusted EBITDA, which is a segment performance measure we define as net income determined in accordance with GAAP, before interest expense, provision for income taxes, depreciation and amortization, stock-based compensation expense and the impact, which may be recurring in nature, of transaction and integration related costs, costs associated with Windstream’s bankruptcy, costs associated with litigation claims made against us, costs associated with the implementation of our enterprise resource planning system, severance costs, costs related to the settlement with Windstream, amortization of non-cash rights-of-use assets, the write off of unamortized deferred financing costs, costs incurred as a result of the early repayment of debt, including early tender and redemption premiums and costs associated with the termination of related hedging activities, gains or losses on dispositions, changes in the fair value of contingent consideration and financial instruments, and other similar or infrequent items (although we may not have had such charges in the periods presented). Adjusted EBITDA includes adjustments to reflect the Company’s share of Adjusted EBITDA from unconsolidated entities. The Company believes that net income, as defined by GAAP, is the most appropriate earnings metric; however, we believe that Adjusted EBITDA serves as a useful supplement to net income because it allows investors, analysts and management to evaluate the performance of our segments in a manner that is comparable period over period. Adjusted EBITDA should not be considered as an alternative to net income as determined in accordance with GAAP.

Selected financial data related to our segments is presented below for the three and six months ended June 30, 2024 and 2023:

	Three Months Ended June 30, 2024
(Thousands)	Uniti Leasing		Uniti Fiber		Corporate		Subtotal of Reportable Segments
Revenues	$	218,286	$	76,661	$	—	$	294,947
Adjusted EBITDA	$	210,853	$	31,091	$	(5,285)	$	236,659
Less:
Interest expense							127,475
Depreciation and amortization	44,613		33,425		14		78,052
Transaction related and other costs							10,977
Other, net							1,048
Stock-based compensation							3,397
Income tax benefit							(2,571)
Net income							$	18,281

	Three Months Ended June 30, 2023
(Thousands)	Uniti Leasing		Uniti Fiber		Corporate		Subtotal of Reportable Segments
Revenues	$	212,453	$	71,245	$	—	$	283,698
Adjusted EBITDA	$	206,552	$	25,181	$	(3,566)	$	228,167
Less:
Interest expense							119,689
Depreciation and amortization	44,690		32,563		14		77,267
Transaction related and other costs							5,576
Other, net							469
Stock-based compensation							3,130
Income tax benefit							(4,357)
Adjustments for equity in earnings from unconsolidated entities							755
Net income							$	25,638

	Six Months Ended June 30, 2024
(Thousands)	Uniti Leasing		Uniti Fiber		Corporate		Subtotal of Reportable Segments
Revenues	$	435,907	$	145,458	$	—	$	581,365
Adjusted EBITDA	$	421,530	$	54,929	$	(11,172)	$	465,287
Less:
Interest expense							250,686
Depreciation and amortization	89,593		65,917		27		155,537
Transaction related and other costs							16,664
Gain on sale of real estate							(18,999)
Other, net							2,959
Stock-based compensation							6,745
Income tax benefit							(7,934)
Net income							$	59,629

	Six Months Ended June 30, 2023
(Thousands)	Uniti Leasing		Uniti Fiber		Corporate		Subtotal of Reportable Segments
Revenues	$	423,261	$	150,259	$	—	$	573,520
Adjusted EBITDA	$	411,518	$	58,855	$	(11,005)	$	459,368
Less:
Interest expense							268,552
Depreciation and amortization	88,862		65,150		30		154,042
Transaction related and other costs							8,364
Other, net							20,982
Stock-based compensation							6,260
Income tax benefit							(6,769)
Adjustments for equity in earnings from unconsolidated entities							1,510
Net income							$	6,427