Derivatives

12 Months Ended

Dec. 31, 2025

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

Derivatives:

As a result of the Merger, the Company assumed two pay fixed, receive variable interest rate swap agreements with the same bank counterparty that had been entered into by Windstream Services to mitigate its exposure to the variability in cash flows on a portion of its floating-rate debt, consisting of the $500.0 million Windstream Term Loan and any borrowings under the Windstream Revolver.

The first swap has a notional value of $200.0 million and matures on October 31, 2029. The fixed rate paid is 4.1730% and the variable rate received is the one-month U.S. Dollar Secured Overnight Financing Rate fallback rate (“USD-SOFR”) (not subject to a floor). The variable rate received resets on the first day of the floating rate calculation period specified in the interest rate swap agreement. The Company designated this swap as a cash flow hedge of the interest rate risk inherent in floating-rate borrowings due to changes in the benchmark interest rate. The second swap had a notional value of $300.0 million and matured on October 31, 2025. Due to its short remaining maturity, this swap did not qualify for hedge accounting as of the Merger date. On August 22, 2025, the Company terminated this swap and received cash proceeds of $2.4 million.

On March 1, 2024, Old Uniti had entered into an interest rate cap related to the ABS Loan Facility, which was designated as a cash flow hedge, with a notional value of $275.0 million, and effectively capped the one-month term USD-SOFR at 4.50%. The interest rate cap expired during the third quarter of 2025.

In conjunction with the fourth quarter 2025 debt refinancing, on October 6, 2025, the Company entered into three new pay fixed, receive variable interest rate swap agreements with two bank counterparties. The first swap has a notional value of $400.0 million, fixed rate paid of 3.332% and matures on October 31, 2028. The second swap has a notional value of $400.0 million, fixed rate paid of 3.365% and matures on October 31, 2029. The third swap has a notional value of $400.0 million, fixed rate paid of 3.417% and matures on October 31, 2030. For all three interest rate swaps, the variable rate received is the one-month USD-SOFR (not subject to a floor) that resets at the end of each month. The Company has designated the swaps as cash flow hedges of the interest rate risk inherent in borrowings outstanding under its Credit Agreements due to changes in the benchmark interest rate.

Set forth below is information related to the Company’s cash flow hedges for the years ended December 31:

(Millions)	2025		2024
Cash flow hedges, measured at fair value:
Other current assets	$	0.3	$	0.1
Other current liabilities	$	1.7	$	—
Other liabilities	$	5.5	$	—
Accumulated other comprehensive loss	$	(2.5)	$	(0.6)

Changes in derivative instruments were as follows for the years ended December 31:

(Millions)	2025		2024
Cash flow hedges:
Changes in fair value, net of tax	$	(0.2)	$	(0.6)
Reclassification of unrealized gains, net of tax	$	(1.7)	$	—

As of December 31, 2025, the Company expects to recognize net losses of $0.2 million net of taxes, in interest expense during the next twelve months for interest settlements related to its interest rate swap agreements.

All or a portion of the change in fair value of the interest rate swap agreements recorded in accumulated other comprehensive income (loss) may be recognized in earnings in certain situations. If the Company extinguishes all of its variable rate debt, or a portion of its variable rate debt such that the outstanding notional amount of the swap exceeds the outstanding notional amount of variable rate debt, all or a portion of the change in fair value of the swap may be recognized in earnings. In addition, the change in fair value of the swap may be recognized in earnings if the Company determines it is no longer probable that it will have future variable rate cash flows to hedge against. The Company has assessed the counterparty risk and determined that no substantial risk of default exists as of December 31, 2025, because each counterparty is a bank with a current credit rating at or above A, as determined by Moody’s Ratings, Standard & Poor’s Global Ratings and Fitch Ratings.

The swap agreements with each of the bank counterparties contain cross-default provisions whereby if the Company were to default on certain indebtedness and that indebtedness was to be accelerated, it could result in the counterparties terminating the outstanding swap agreements. Were such a termination to occur, the party that was in a liability position under the applicable swap at the time of such termination would be required to pay the value of the swap, as determined in accordance with the terms of the applicable swap agreement, to the other party. The Company’s obligations to the counterparties are secured and the Company does not post any separate collateral to the bank counterparties related to its interest rate swap agreements.

Balance Sheet Offsetting

The Company is party to master netting arrangements, which are designed to reduce credit risk by permitting net settlement of transactions, with counterparties. For financial statement presentation purposes, the Company does not offset assets and liabilities under these arrangements. As of December 31, 2024, there were no derivative liabilities subject to enforceable master netting arrangements to offset against derivative assets.

The following table presents the Company’s derivative assets subject to an enforceable master netting arrangement as of December 31, 2025.

	Gross Amount of Assets Presented in the Consolidated Balance Sheets		Gross Amount Not Offset in the Consolidated Balance Sheets
(Millions)			Financial Instruments		Cash Collateral Received		Net Amount
December 31, 2025:
Interest rate swaps	$	0.3	$	(0.3)	$	—	$	—

Information pertaining to derivative liabilities was as follows:

	Gross Amount of Liabilities Presented in the Consolidated Balance Sheets		Gross Amount Not Offset in the Consolidated Balance Sheets
Millions			Financial Instruments		Cash Collateral Received		Net Amount
December 31, 2025:
Interest rate swaps	$	7.2	$	(0.3)	$	—	$	6.9