Array Q2 2026 earnings: Spectrum sales drive profit as tower revenue rises

Array Digital Infrastructure (NYSE: AD) reported second-quarter 2026 revenue from continuing operations of $54.1 million, up 90% from $28.5 million a year earlier, while diluted EPS from continuing operations attributable to shareholders rose to $3.86 from $0.17. Site rental revenue climbed 95% and tower tenancy improved sequentially, but the quarter’s large GAAP profit was primarily tied to spectrum license sales rather than tower operations. Array also raised its 2026 adjusted EBITDA outlook and increased the low end of revenue guidance.

Core Earnings Results

Array released the results on August 7, 2026, for the quarter ended June 30. A $409.8 million gain on license sales turned the prior-year operating loss into $399.3 million of operating income, making the adjusted results more useful for evaluating the underlying tower business.

Adjusted EBITDA increased by approximately 56% to $56.2 million. Adjusted OIBDA, which further excludes earnings from unconsolidated investments and interest and dividend income, moved from a $9.5 million loss to a $15.1 million profit.

N/M means the percentage change was not meaningful, largely because of the spectrum-related gains and the prior-year loss comparison.

Business and Tower Operations

Site rental generated $53.2 million of the quarter’s $54.1 million in operating revenue, making it the clear growth driver. Services revenue declined 31%, but its smaller scale limited the effect on total revenue.

Tower operating metrics also improved from the first quarter, with 72 additional colocations and a tenancy rate of 0.98 compared with 0.96.

The colocation and tenancy figures include T-Mobile’s committed minimum of 2,015 sites but exclude up to 1,800 interim sites. Array has also excluded DISH Wireless from these metrics since March 31, 2026 because it considers fulfillment of DISH’s lease commitments unlikely.

Spectrum Monetization Drove GAAP Profit Far Above Tower Earnings

Array completed three spectrum transactions during the quarter: a $74.8 million 700 MHz license sale on May 5, an $86.4 million 600 MHz license sale on May 12, and a $1 billion sale of cellular and other licenses on June 1. Together, these transactions produced approximately $1.16 billion of proceeds.

The accounting impact explains the gap between GAAP and adjusted profitability. Q2 EBITDA was $478.6 million, but adjusted EBITDA was $56.2 million after excluding the $409.8 million license-sale gain, $23.8 million of short-term imputed spectrum lease income and other adjustments. The quarter therefore showed improved tower economics, but most reported earnings did not come from recurring site rental operations.

Approximately $30 million of additional 600 MHz and 700 MHz license transactions remained pending. Array expects them to close in 2026, subject to regulatory approval and customary closing conditions.

Cash Flow and Balance Sheet

Cash flow data were provided for the first six months of 2026 rather than Q2 alone. Continuing operations used $13.2 million of operating cash during the six-month period, while non-GAAP adjusted free cash flow was positive at $6.6 million. This contrasts with the large GAAP profit because cash proceeds from asset sales are classified as investing activities and the related gains are removed from adjusted cash flow.

First-half investing cash inflow reached $2.17 billion, driven by $2.19 billion received from divestitures. Financing activities used $1.84 billion, including $1.84 billion of dividends paid to Array shareholders. The company separately declared and paid an $11-per-share special dividend on June 25.

Cash and cash equivalents ended June at $416.4 million, up from $113.4 million at the end of 2025, while net long-term debt was relatively stable at $666.8 million. Current liabilities increased to $461.7 million from $200.0 million, including accrued taxes of $317.4 million compared with $16.9 million at year-end.

2026 Guidance

Array raised the low end of revenue guidance because of higher interim site revenue and increased both ends of its adjusted profitability ranges. Capital spending guidance was unchanged.

The $160 million difference between adjusted EBITDA and adjusted OIBDA reflects expected equity earnings from unconsolidated entities and interest and dividend income. Adjusted OIBDA therefore provides the narrower view of profitability generated by operating activities.

Recent Insider Transactions

The supplied insider summary shows no purchases or sales during the latest six-month period and reports total insider holdings of 61.93 million shares. Separate filings included stock awards and a derivative security exercise, which were not classified as purchases or sales in that summary.

These records describe the transactions but do not establish insiders’ views about Array’s future performance.

Risks Investors Should Monitor

• Earnings normalization: The $409.8 million license-sale gain drove most of Q2 GAAP profit. Future results may look materially different as spectrum monetization winds down and tower operations become the primary earnings source.
• DISH Wireless exposure: Array stopped recognizing DISH-related revenue in Q1 2026 after DISH disputed its lease obligations. DISH and related entities filed for bankruptcy in June, creating uncertainty around lease commitments and potential recoveries.
• Temporary interim-site revenue: Higher interim site revenue supported the guidance increase, but T-Mobile can lease up to 1,800 interim sites for periods of up to 30 months. These sites are also excluded from reported tenancy metrics.
• Pending spectrum closings: Approximately $30 million of remaining spectrum transactions require regulatory approval and satisfaction of closing conditions.
• Strategic and ownership uncertainty: TDS, which owned approximately 81.9% of Array at quarter-end, submitted a non-binding proposal to acquire the shares it does not already own. An independent special committee is evaluating the proposal, with no final outcome disclosed.

Summary

Array’s Q2 2026 results reflected two different trends: site rental revenue nearly doubled and tower tenancy improved sequentially, while spectrum sales produced most of the quarter’s GAAP earnings and cash inflows. Adjusted operating profitability strengthened and management raised 2026 guidance, but the next phase depends on tower-level growth, the durability of interim T-Mobile revenue, cash conversion and the resolution of DISH, pending spectrum sales and the TDS proposal.

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