Leases

12 Months Ended

Dec. 31, 2025

Leases [Abstract]

Leases

Leases:

As previously discussed in Note 4, as of August 1, 2025, preexisting relationships between Old Uniti and Windstream, were considered effectively settled for accounting purposes and the related transactions and balances became intercompany transactions eliminated in the preparation of the Company’s post-Merger consolidated financial statements. These preexisting relationships included the Windstream Leases, the asset purchase agreement and various other leasing and supplier arrangements between Old Uniti and Windstream. The elimination of the intercompany transactions resulted in reductions in operating lease revenue, operating lease right-of-use assets and operating lease obligations discussed below.

Lessor Arrangements

Certain service offerings to customers include equipment leases. The Company also leases its network facilities, including colocation space to other service providers and enters into arrangements with third parties to lease unused or underutilized portions of its network. These leases meet the criteria for operating lease classification. These leases have initial lease terms ranging from less than one year to 35 years, most of which include options to extend or renew the leases for less than one year to 20 years (based on the satisfaction of certain conditions as defined in the lease agreements), and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of the leases, variable payments.

Operating lease income was as follows for the years ended December 31:

(Millions)	2025		2024		2023
Lease income - operating leases	$	669.4	$	921.4	$	910.9

Operating lease income is included in service revenues in the consolidated statements of income (loss).

Future lease payments to be received under non-cancellable operating leases were as follows for the years ended December 31:

Year	(Millions)
2026	$	93.8
2027	88.0
2028	81.3
2029	75.3
2030	66.3
Thereafter	456.1
Total lease receivables	$	860.8

The underlying assets under operating leases were as follows as of December 31:

(Millions)	2024
Land	$	26.7
Building and improvements	350.8
Poles	341.6
Fiber	4,325.5
Copper	3,972.8
Equipment	0.4
	9,017.8
Less accumulated depreciation	(5,852.6)
Underlying assets under operating leases, net	$	3,165.2

Depreciation expense for the underlying assets under operating leases was $112.9 million for the period January 1, 2025 to July 31, 2025 and $186.4 million and $182.9 million for the years ended December 31, 2024 and 2023, respectively.

Following the Merger and the corresponding change to account for the Windstream Leases as intercompany activity, the remaining owned assets under operating leases in which the Company is the lessor is not significant to the consolidated financial position of the Company as of December 31, 2025.

Periodically, the Company enters into indefeasible right of use (“IRU”) arrangements that grant exclusive access to and unrestricted use of specific dark fiber assets and for which the terms of the arrangements are for a major part of the assets’ remaining economic life. These IRU arrangements meet the criteria for sales-type lease classification. Sales revenue, cost of sales and gross profit recognized by the Company related to IRU arrangements were as follows for the years ended December 31:

(Millions)	2025		2024		2023
Sales revenue	$	16.3	$	7.8	$	0.9
Cost of sales	8.4		2.8		0.4
Gross profit	$	7.9	$	5.0	$	0.5

Lessee Arrangements

The Company has commitments under operating leases for network facilities including communications towers, ground, colocation, other communication equipment, dark fiber lease arrangements, buildings, vehicles, office space and office equipment. The Company has also entered into finance lease agreements for facilities and equipment for use in our operations. These leases have initial lease terms ranging from less than one year to 30 years, most of which include options to extend or renew the leases for less than one year to 20 years, and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of our leases, variable payments.

The components of operating lease cost are presented within cost of services and selling, general and administrative expenses, while the components of finance lease cost are presented within depreciation and amortization and interest expense, net.

Sublease income is presented within service revenues in the consolidated statements of income (loss). Components of net lease cost were as follows as of December 31:

(Millions)	2025		2024		2023
Finance lease cost:
Amortization of ROU assets	$	7.7	$	4.2	$	4.1
Interest on lease liabilities	3.0		1.7		1.6
Total finance lease cost	10.7		5.9		5.7
Operating lease cost	81.3		24.9		23.0
Short-term lease cost	12.5		4.2		3.5
Variable lease cost	1.4		0.6		0.9
Less sublease income	(22.5)		(17.8)		(14.6)
Net lease cost	$	83.4	$	17.8	$	18.5

As of December 31, 2025, the Company has short term lease commitments totaling approximately $23.1 million. Amounts reported in the consolidated balance sheets for leases in which we are the lessee were as follows as of December 31:

(Millions)	2025		2024
Operating Leases
Operating lease right-of-use assets, net	$	516.6	$	126.8
Current portion of operating lease obligations	$	122.6	$	12.7
Noncurrent operating lease obligations	360.5		67.8
Total operating lease liabilities	$	483.1	$	80.5
Finance Leases
Property, plant and equipment, gross	$	93.6	$	52.8
Accumulated depreciation	(9.8)		(23.3)
Property, plant and equipment, net	$	83.8	$	29.5
Other current liabilities	$	6.4	$	2.7
Other liabilities	50.7		14.5
Total finance lease liabilities	$	57.1	$	17.2

Weighted Average Remaining Lease Term
Operating leases	6.1 years		13.8 years
Finance leases	10.2 years		7.5 years
Weighted Average Discount Rate
Operating leases	6.7	%	10.4	%
Finance leases	7.9	%	10.0	%

Other information related to leases was as follows as of December 31:

(Millions)	2025		2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows for operating leases	$	73.9	$	31.3	$	22.3
Operating cash outflows for finance leases	$	2.7	$	1.7	$	1.6
Financing cash outflows for finance leases	$	5.8	$	2.7	$	2.3
Non-cash items:
New operating leases and remeasurements, net	$	46.4	$	19.0	$	32.5
New finance leases and remeasurements, net	$	8.0	$	1.8	$	5.7

Future lease payments under non-cancellable leases as of December 31, 2025 are as follows:

(Millions)	Operating Leases		Finance Leases
2026	$	127.8	$	10.5
2027	106.7		9.3
2028	81.1		8.3
2029	60.1		7.6
2030	46.0		7.0
Thereafter	139.3		38.8
Total undiscounted lease payments	$	561.0	$	81.5
Less imputed interest	(77.9)		(24.4)
Total lease liabilities	$	483.1	$	57.1

Future sublease rentals as of December 31, 2025 are as follows:

(Millions)	Sublease Rentals
2026	$	16.3
2027	16.6
2028	16.4
2029	14.6
2030	11.9
Thereafter	127.6
Total	$	203.4

Leases

Leases:

As previously discussed in Note 4, as of August 1, 2025, preexisting relationships between Old Uniti and Windstream, were considered effectively settled for accounting purposes and the related transactions and balances became intercompany transactions eliminated in the preparation of the Company’s post-Merger consolidated financial statements. These preexisting relationships included the Windstream Leases, the asset purchase agreement and various other leasing and supplier arrangements between Old Uniti and Windstream. The elimination of the intercompany transactions resulted in reductions in operating lease revenue, operating lease right-of-use assets and operating lease obligations discussed below.

Lessor Arrangements

Certain service offerings to customers include equipment leases. The Company also leases its network facilities, including colocation space to other service providers and enters into arrangements with third parties to lease unused or underutilized portions of its network. These leases meet the criteria for operating lease classification. These leases have initial lease terms ranging from less than one year to 35 years, most of which include options to extend or renew the leases for less than one year to 20 years (based on the satisfaction of certain conditions as defined in the lease agreements), and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of the leases, variable payments.

Operating lease income was as follows for the years ended December 31:

(Millions)	2025		2024		2023
Lease income - operating leases	$	669.4	$	921.4	$	910.9

Operating lease income is included in service revenues in the consolidated statements of income (loss).

Future lease payments to be received under non-cancellable operating leases were as follows for the years ended December 31:

Year	(Millions)
2026	$	93.8
2027	88.0
2028	81.3
2029	75.3
2030	66.3
Thereafter	456.1
Total lease receivables	$	860.8

The underlying assets under operating leases were as follows as of December 31:

(Millions)	2024
Land	$	26.7
Building and improvements	350.8
Poles	341.6
Fiber	4,325.5
Copper	3,972.8
Equipment	0.4
	9,017.8
Less accumulated depreciation	(5,852.6)
Underlying assets under operating leases, net	$	3,165.2

Depreciation expense for the underlying assets under operating leases was $112.9 million for the period January 1, 2025 to July 31, 2025 and $186.4 million and $182.9 million for the years ended December 31, 2024 and 2023, respectively.

Following the Merger and the corresponding change to account for the Windstream Leases as intercompany activity, the remaining owned assets under operating leases in which the Company is the lessor is not significant to the consolidated financial position of the Company as of December 31, 2025.

Periodically, the Company enters into indefeasible right of use (“IRU”) arrangements that grant exclusive access to and unrestricted use of specific dark fiber assets and for which the terms of the arrangements are for a major part of the assets’ remaining economic life. These IRU arrangements meet the criteria for sales-type lease classification. Sales revenue, cost of sales and gross profit recognized by the Company related to IRU arrangements were as follows for the years ended December 31:

(Millions)	2025		2024		2023
Sales revenue	$	16.3	$	7.8	$	0.9
Cost of sales	8.4		2.8		0.4
Gross profit	$	7.9	$	5.0	$	0.5

Lessee Arrangements

The Company has commitments under operating leases for network facilities including communications towers, ground, colocation, other communication equipment, dark fiber lease arrangements, buildings, vehicles, office space and office equipment. The Company has also entered into finance lease agreements for facilities and equipment for use in our operations. These leases have initial lease terms ranging from less than one year to 30 years, most of which include options to extend or renew the leases for less than one year to 20 years, and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of our leases, variable payments.

The components of operating lease cost are presented within cost of services and selling, general and administrative expenses, while the components of finance lease cost are presented within depreciation and amortization and interest expense, net.

Sublease income is presented within service revenues in the consolidated statements of income (loss). Components of net lease cost were as follows as of December 31:

(Millions)	2025		2024		2023
Finance lease cost:
Amortization of ROU assets	$	7.7	$	4.2	$	4.1
Interest on lease liabilities	3.0		1.7		1.6
Total finance lease cost	10.7		5.9		5.7
Operating lease cost	81.3		24.9		23.0
Short-term lease cost	12.5		4.2		3.5
Variable lease cost	1.4		0.6		0.9
Less sublease income	(22.5)		(17.8)		(14.6)
Net lease cost	$	83.4	$	17.8	$	18.5

As of December 31, 2025, the Company has short term lease commitments totaling approximately $23.1 million. Amounts reported in the consolidated balance sheets for leases in which we are the lessee were as follows as of December 31:

(Millions)	2025		2024
Operating Leases
Operating lease right-of-use assets, net	$	516.6	$	126.8
Current portion of operating lease obligations	$	122.6	$	12.7
Noncurrent operating lease obligations	360.5		67.8
Total operating lease liabilities	$	483.1	$	80.5
Finance Leases
Property, plant and equipment, gross	$	93.6	$	52.8
Accumulated depreciation	(9.8)		(23.3)
Property, plant and equipment, net	$	83.8	$	29.5
Other current liabilities	$	6.4	$	2.7
Other liabilities	50.7		14.5
Total finance lease liabilities	$	57.1	$	17.2

Weighted Average Remaining Lease Term
Operating leases	6.1 years		13.8 years
Finance leases	10.2 years		7.5 years
Weighted Average Discount Rate
Operating leases	6.7	%	10.4	%
Finance leases	7.9	%	10.0	%

Other information related to leases was as follows as of December 31:

(Millions)	2025		2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows for operating leases	$	73.9	$	31.3	$	22.3
Operating cash outflows for finance leases	$	2.7	$	1.7	$	1.6
Financing cash outflows for finance leases	$	5.8	$	2.7	$	2.3
Non-cash items:
New operating leases and remeasurements, net	$	46.4	$	19.0	$	32.5
New finance leases and remeasurements, net	$	8.0	$	1.8	$	5.7

Future lease payments under non-cancellable leases as of December 31, 2025 are as follows:

(Millions)	Operating Leases		Finance Leases
2026	$	127.8	$	10.5
2027	106.7		9.3
2028	81.1		8.3
2029	60.1		7.6
2030	46.0		7.0
Thereafter	139.3		38.8
Total undiscounted lease payments	$	561.0	$	81.5
Less imputed interest	(77.9)		(24.4)
Total lease liabilities	$	483.1	$	57.1

Future sublease rentals as of December 31, 2025 are as follows:

(Millions)	Sublease Rentals
2026	$	16.3
2027	16.6
2028	16.4
2029	14.6
2030	11.9
Thereafter	127.6
Total	$	203.4

Leases

Leases:

As previously discussed in Note 4, as of August 1, 2025, preexisting relationships between Old Uniti and Windstream, were considered effectively settled for accounting purposes and the related transactions and balances became intercompany transactions eliminated in the preparation of the Company’s post-Merger consolidated financial statements. These preexisting relationships included the Windstream Leases, the asset purchase agreement and various other leasing and supplier arrangements between Old Uniti and Windstream. The elimination of the intercompany transactions resulted in reductions in operating lease revenue, operating lease right-of-use assets and operating lease obligations discussed below.

Lessor Arrangements

Certain service offerings to customers include equipment leases. The Company also leases its network facilities, including colocation space to other service providers and enters into arrangements with third parties to lease unused or underutilized portions of its network. These leases meet the criteria for operating lease classification. These leases have initial lease terms ranging from less than one year to 35 years, most of which include options to extend or renew the leases for less than one year to 20 years (based on the satisfaction of certain conditions as defined in the lease agreements), and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of the leases, variable payments.

Operating lease income was as follows for the years ended December 31:

(Millions)	2025		2024		2023
Lease income - operating leases	$	669.4	$	921.4	$	910.9

Operating lease income is included in service revenues in the consolidated statements of income (loss).

Future lease payments to be received under non-cancellable operating leases were as follows for the years ended December 31:

Year	(Millions)
2026	$	93.8
2027	88.0
2028	81.3
2029	75.3
2030	66.3
Thereafter	456.1
Total lease receivables	$	860.8

The underlying assets under operating leases were as follows as of December 31:

(Millions)	2024
Land	$	26.7
Building and improvements	350.8
Poles	341.6
Fiber	4,325.5
Copper	3,972.8
Equipment	0.4
	9,017.8
Less accumulated depreciation	(5,852.6)
Underlying assets under operating leases, net	$	3,165.2

Depreciation expense for the underlying assets under operating leases was $112.9 million for the period January 1, 2025 to July 31, 2025 and $186.4 million and $182.9 million for the years ended December 31, 2024 and 2023, respectively.

Following the Merger and the corresponding change to account for the Windstream Leases as intercompany activity, the remaining owned assets under operating leases in which the Company is the lessor is not significant to the consolidated financial position of the Company as of December 31, 2025.

Periodically, the Company enters into indefeasible right of use (“IRU”) arrangements that grant exclusive access to and unrestricted use of specific dark fiber assets and for which the terms of the arrangements are for a major part of the assets’ remaining economic life. These IRU arrangements meet the criteria for sales-type lease classification. Sales revenue, cost of sales and gross profit recognized by the Company related to IRU arrangements were as follows for the years ended December 31:

(Millions)	2025		2024		2023
Sales revenue	$	16.3	$	7.8	$	0.9
Cost of sales	8.4		2.8		0.4
Gross profit	$	7.9	$	5.0	$	0.5

Lessee Arrangements

The Company has commitments under operating leases for network facilities including communications towers, ground, colocation, other communication equipment, dark fiber lease arrangements, buildings, vehicles, office space and office equipment. The Company has also entered into finance lease agreements for facilities and equipment for use in our operations. These leases have initial lease terms ranging from less than one year to 30 years, most of which include options to extend or renew the leases for less than one year to 20 years, and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of our leases, variable payments.

The components of operating lease cost are presented within cost of services and selling, general and administrative expenses, while the components of finance lease cost are presented within depreciation and amortization and interest expense, net.

Sublease income is presented within service revenues in the consolidated statements of income (loss). Components of net lease cost were as follows as of December 31:

(Millions)	2025		2024		2023
Finance lease cost:
Amortization of ROU assets	$	7.7	$	4.2	$	4.1
Interest on lease liabilities	3.0		1.7		1.6
Total finance lease cost	10.7		5.9		5.7
Operating lease cost	81.3		24.9		23.0
Short-term lease cost	12.5		4.2		3.5
Variable lease cost	1.4		0.6		0.9
Less sublease income	(22.5)		(17.8)		(14.6)
Net lease cost	$	83.4	$	17.8	$	18.5

As of December 31, 2025, the Company has short term lease commitments totaling approximately $23.1 million. Amounts reported in the consolidated balance sheets for leases in which we are the lessee were as follows as of December 31:

(Millions)	2025		2024
Operating Leases
Operating lease right-of-use assets, net	$	516.6	$	126.8
Current portion of operating lease obligations	$	122.6	$	12.7
Noncurrent operating lease obligations	360.5		67.8
Total operating lease liabilities	$	483.1	$	80.5
Finance Leases
Property, plant and equipment, gross	$	93.6	$	52.8
Accumulated depreciation	(9.8)		(23.3)
Property, plant and equipment, net	$	83.8	$	29.5
Other current liabilities	$	6.4	$	2.7
Other liabilities	50.7		14.5
Total finance lease liabilities	$	57.1	$	17.2

Weighted Average Remaining Lease Term
Operating leases	6.1 years		13.8 years
Finance leases	10.2 years		7.5 years
Weighted Average Discount Rate
Operating leases	6.7	%	10.4	%
Finance leases	7.9	%	10.0	%

Other information related to leases was as follows as of December 31:

(Millions)	2025		2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows for operating leases	$	73.9	$	31.3	$	22.3
Operating cash outflows for finance leases	$	2.7	$	1.7	$	1.6
Financing cash outflows for finance leases	$	5.8	$	2.7	$	2.3
Non-cash items:
New operating leases and remeasurements, net	$	46.4	$	19.0	$	32.5
New finance leases and remeasurements, net	$	8.0	$	1.8	$	5.7

Future lease payments under non-cancellable leases as of December 31, 2025 are as follows:

(Millions)	Operating Leases		Finance Leases
2026	$	127.8	$	10.5
2027	106.7		9.3
2028	81.1		8.3
2029	60.1		7.6
2030	46.0		7.0
Thereafter	139.3		38.8
Total undiscounted lease payments	$	561.0	$	81.5
Less imputed interest	(77.9)		(24.4)
Total lease liabilities	$	483.1	$	57.1

Future sublease rentals as of December 31, 2025 are as follows:

(Millions)	Sublease Rentals
2026	$	16.3
2027	16.6
2028	16.4
2029	14.6
2030	11.9
Thereafter	127.6
Total	$	203.4