Shentel第二季服務收入增5.5% Glo Fiber收入升32.8% 惟傳統寬頻跌6% 淨虧損收窄至770萬美元

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q 
(Mark One)

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2026

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from__________ to __________

Commission File No.: 000-09881 

SHENANDOAH TELECOMMUNICATIONS COMPANY 
(Exact name of registrant as specified in its charter)

Virginia 54-1162807
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

500 Shentel Way, Edinburg, Virginia    22824 
(Address of principal executive offices)  (Zip Code)

(540) 984-4141  
(Registrant's telephone number, including area code) 

SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
 
Common Stock (No Par Value)SHENNASDAQ Global Select Market53,364,680
(Title of Class)(Trading Symbol)(Name of Exchange on which Registered)(The number of shares of the registrant's common stock outstanding on July 22, 2026)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒   No ☐
 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).   Yes ☒   No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer☒
Accelerated filer ☐Non-accelerated filer☐Smaller reporting company☐Emerging growth company☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐  No  ☒

SHENANDOAH TELECOMMUNICATIONS COMPANY
INDEX

  Page
Numbers
PART I.FINANCIAL INFORMATION 
   
Item 1.Financial Statements 
   
 Unaudited Condensed Consolidated Balance Sheets3

  
 Unaudited Condensed Consolidated Statements of Operations
4

  
Unaudited Condensed Consolidated Statements of Comprehensive Loss5

 Unaudited Condensed Consolidated Statements of Temporary Equity and Shareholders’ Equity
6

  
 Unaudited Condensed Consolidated Statements of Cash Flows8

  
 Notes to Unaudited Condensed Consolidated Financial Statements9

  
Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations23

  
Item 3.Quantitative and Qualitative Disclosures about Market Risk34

  
Item 4.Controls and Procedures34

  
PART II.OTHER INFORMATION
  
Item 1.Legal Proceedings35

Item 1A.Risk Factors35

  
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds35

  
Item 5.Other Information
35

Item 6.Exhibits36

  
 Signatures37

  

2

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SHENANDOAH TELECOMMUNICATIONS COMPANY AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)June 30,
2026December 31,
2025
ASSETS
Current assets:
Cash and cash equivalents$23,895 $27,259 
Restricted cash and cash equivalents30,899 20,945 
Accounts receivable, net of allowance for credit losses of $1,314 and $829, respectively
20,526 31,497 
Income taxes receivable3,444 2,544 
Prepaid expenses and other14,662 15,198 
Total current assets93,426 97,443 
Investments16,312 16,510 
Property, plant and equipment, net1,671,466 1,601,609 
Goodwill67,538 67,538 
Intangible assets, net88,566 89,353 
Operating lease right-of-use assets19,092 19,657 
Deferred charges and other assets18,548 18,652 
Total assets$1,974,948 $1,910,762 
LIABILITIES, TEMPORARY EQUITY AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable$58,217 $61,355 
Advanced billings and customer deposits18,046 16,909 
Accrued compensation12,750 13,334 
Current operating lease liabilities2,765 2,819 
Accrued liabilities and other17,890 14,079 
Total current liabilities109,668 108,496 
Long-term debt, net of unamortized loan fees715,027 628,237 
Other long-term liabilities:
Deferred income taxes150,969 157,618 
Benefit plan obligations4,428 4,150 
Non-current operating lease liabilities10,140 10,632 
Other liabilities33,090 32,340 
Total other long-term liabilities198,627 204,740 
Commitments and contingencies (Note 13)

Temporary equity:
Redeemable noncontrolling interest91,688 88,506 
Shareholders’ equity:
Common stock, no par value, authorized 96,000; 55,364 and 54,899 issued and outstanding at June 30, 2026 and December 31, 2025, respectively
— — 
Additional paid in capital163,003 157,216 
Retained earnings696,935 723,567 
Total shareholders’ equity859,938 880,783 
Total liabilities, temporary equity and shareholders’ equity$1,974,948 $1,910,762 

See accompanying notes to unaudited condensed consolidated financial statements.
3

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SHENANDOAH TELECOMMUNICATIONS COMPANY AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)Three Months Ended
June 30,Six Months Ended
June 30,
2026202520262025
Service revenue and other$93,462 $88,568 $185,615 $176,466 
Operating expenses:
Cost of services, exclusive of depreciation and amortization32,703 32,624 64,527 65,654 
Selling, general and administrative31,022 29,743 64,409 60,735 
Restructuring, integration and acquisition134 206 2,574 716 
Depreciation and amortization30,619 35,103 65,590 64,561 
Total operating expenses94,478 97,676 197,100 191,666 
Operating loss(1,016)(9,108)(11,485)(15,200)
Other (expense) income:
Interest expense(9,696)(6,003)(19,131)(10,895)
Other income, net472 3,015 517 3,748 
Loss before income taxes(10,240)(12,096)(30,099)(22,347)
Income tax benefit(2,541)(3,048)(6,649)(4,167)
Net loss(7,699)(9,048)(23,450)(18,180)
Dividends on redeemable noncontrolling interest1,605 1,497 3,182 2,969 
Net loss attributable to common shareholders$(9,304)$(10,545)$(26,632)$(21,149)

Net loss per share attributable to common shareholders, basic and diluted:
Net loss per share$(0.17)$(0.19)$(0.48)$(0.38)

Weighted average shares outstanding55,779 55,103 55,664 55,032 

See accompanying notes to unaudited condensed consolidated financial statements.

4

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SHENANDOAH TELECOMMUNICATIONS COMPANY AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(in thousands)
Three Months Ended
June 30,Six Months Ended
June 30,
2026202520262025
Net loss$(7,699)$(9,048)$(23,450)$(18,180)
Other comprehensive loss:
Net change in unrealized gain (loss)— 182 — (40)
Amounts reclassified from accumulated other comprehensive loss— (405)— (813)
Comprehensive loss(7,699)(9,271)(23,450)(19,033)
Dividends on redeemable noncontrolling interest1,605 1,497 3,182 2,969 
Comprehensive loss attributable to common shareholders$(9,304)$(10,768)$(26,632)$(22,002)

See accompanying notes to unaudited condensed consolidated financial statements.
5

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SHENANDOAH TELECOMMUNICATIONS COMPANY AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF TEMPORARY EQUITY AND SHAREHOLDERS' EQUITY
(in thousands)

Redeemable Noncontrolling InterestCommon Stock
SharesAmountShares 
(no par value)Additional Paid in CapitalRetained EarningsAccumulated Other Comprehensive IncomeTotal Shareholders’ Equity
Balance, March 31, 202681 $90,083 55,302 $160,719 $706,239 $— $866,958 
Net loss — — — — (7,699)— (7,699)
Stock-based compensation— — 82 2,595 — — 2,595 
Common stock issued— — 1 11 — — 11 
Shares surrendered for settlement of employee taxes upon issuance of vested equity awards— — (21)(322)— — (322)
Preferred stock dividends - paid in kind— 1,605 — — (1,605)— (1,605)
Balance, June 30, 202681 $91,688 55,364 $163,003 $696,935 $— $859,938 

Redeemable Noncontrolling InterestCommon Stock
SharesAmountShares 
(no par value)Additional Paid in CapitalRetained EarningsAccumulated Other Comprehensive IncomeTotal Shareholders’ Equity
Balance, December 31, 202581 $88,506 54,899 $157,216 $723,567 $— $880,783 
Net loss— — — — (23,450)— (23,450)
Stock-based compensation— — 598 7,566 — — 7,566 
Common stock issued— — 2 25 — — 25 
Shares surrendered for settlement of employee taxes upon issuance of vested equity awards— — (135)(1,804)— — (1,804)
Preferred stock dividends - paid in kind— 3,182 — — (3,182)— (3,182)
Balance, June 30, 202681 $91,688 55,364 $163,003 $696,935 $— $859,938 

6

Table of Contents

Redeemable Noncontrolling InterestCommon Stock
SharesAmountShares of Common Stock (no par value)Additional Paid in CapitalRetained EarningsAccumulated Other Comprehensive IncomeTotal Shareholders’ Equity
Balance, March 31, 202581 $83,936 54,857 $150,857 $758,393 $1,223 $910,473 
Net loss— — — — (9,048)— (9,048)
Unrealized gain on interest rate hedge, net of tax— — — — — 182 182 
Amounts reclassified from accumulated other comprehensive income— — — — — (405)(405)
Stock-based compensation— — 57 2,493 — — 2,493 
Common stock issued— — 1 14 — — 14 
Shares surrendered for settlement of employee taxes upon issuance of vested equity awards— — (18)(248)— — (248)
Preferred stock dividends— 1,497 — — (1,497)— (1,497)
Balance, June 30, 202581 $85,433 54,897 $153,116 $747,848 $1,000 $901,964 

Redeemable Noncontrolling InterestCommon Stock
SharesAmountShares of Common Stock (no par value)Additional Paid in CapitalRetained EarningsAccumulated Other Comprehensive IncomeTotal Shareholders’ Equity
Balance, December 31, 202481 $82,464 54,605 $147,733 $768,997 $1,853 $918,583 
Net loss— — — — (18,180)— (18,180)
Unrealized loss on interest rate hedge, net of tax— — — — — (40)(40)
Amounts reclassified from accumulated other comprehensive income
— — — — — (813)(813)
Stock-based compensation— — 375 6,390 — — 6,390 
Common stock issued— — 2 28 — — 28 
Shares surrendered for settlement of employee taxes upon issuance of vested equity awards— — (85)(1,035)— — (1,035)
Preferred stock dividends - paid in kind— 2,969 — — (2,969)— (2,969)
Balance, June 30, 202581 $85,433 54,897 $153,116 $747,848 $1,000 $901,964 

See accompanying notes to unaudited condensed consolidated financial statements.
7

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SHENANDOAH TELECOMMUNICATIONS COMPANY AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)Six Months Ended
June 30,
20262025
Cash flows from operating activities:
Net loss$(23,450)$(18,180)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization64,769 63,613 
Amortization of intangible assets821 948 
Stock-based compensation expense, net of amount capitalized7,101 5,904 
Deferred income taxes(6,649)(4,167)
Provision for credit losses886 804 
Other, net2,025 165 
Changes in assets and liabilities:
Accounts receivable224 1,155 
Current income taxes(900)217 
Operating lease assets and liabilities, net(79)(437)
Other assets52 (2,345)
Accounts payable236 975 
Other deferrals and accruals3,770 (4,931)
Net cash provided by operating activities - continuing operations48,806 43,721 
Net cash used in operating activities - discontinued operations— (2,251)
Net cash provided by operating activities48,806 41,470 

Cash flows from investing activities:
Capital expenditures(146,195)(169,432)
Government grants received20,618 17,281 
Proceeds from sale of assets and other750 243 
Net cash used in investing activities(124,827)(151,908)

Cash flows from financing activities:
Proceeds from credit facility borrowings113,000 100,000 
Principal payments on long-term debt(27,000)(4,893)
Payments for debt issuance and amendment costs(429)(430)
Taxes paid for equity award issuances(1,804)(1,035)
Payments for financing arrangements and other(1,156)(399)
Net cash provided by financing activities82,611 93,243 
Net increase (decrease) in cash and cash equivalents6,590 (17,195)
Cash, cash equivalents, and restricted cash, beginning of period48,204 46,272 
Cash, cash equivalents, and restricted cash, end of period$54,794 $29,077 

Supplemental Disclosures of Cash Flow Information
Interest paid, net of amounts capitalized$(18,315)$(9,891)
Income taxes paid$(900)$(2,034)

The following table provides the composition of the company’s cash, cash equivalents, and restricted cash balances as of June 30, 2026 and December 31, 2025 as shown above:

(in thousands)June 30,
2026December 31,
2025
Cash and cash equivalents
$23,895 $27,259 
Restricted cash
30,899 20,945 
Cash, cash equivalents, and restricted cash
$54,794 $48,204 

See accompanying notes to unaudited condensed consolidated financial statements.
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SHENANDOAH TELECOMMUNICATIONS COMPANY AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Basis of Presentation and Other Information 

Shenandoah Telecommunications Company and its subsidiaries (collectively, “Shentel”, “we”, “our”, “us”, or the “Company”) provide broadband data, video and voice services to residential and commercial customers in portions of Virginia, West Virginia, Maryland, Pennsylvania, Kentucky, Delaware, Ohio and Indiana, via fiber optic and hybrid fiber coaxial (“HFC”) cable networks. We also lease dark fiber and provide Ethernet and Wavelength fiber optic services to enterprise and wholesale customers throughout the entirety of our service area. Shentel’s Broadband business also provides voice and digital subscriber line (“DSL”) services as a Rural Local Exchange Carrier (“RLEC”) to customers in Shenandoah County and portions of adjacent counties in Virginia, and in Ross County and portions of adjacent counties in Ohio. These integrated networks are connected by a fiber network.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X for interim financial information. All normal recurring adjustments considered necessary for a fair presentation have been included. Certain disclosures normally included in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) have been omitted. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2025.

The preparation of the unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, revenues and expenses and related disclosures. On an on-going basis we evaluate estimates and assumptions, including, but not limited to, revenue recognition, stock-based compensation, estimated useful lives of assets, impairment of goodwill and indefinite-lived intangible assets, realizability of intangible assets subject to amortization and the computation of income taxes. Future events and their effects cannot be predicted with certainty; accordingly, the Company’s accounting estimates require the exercise of judgment. The accounting estimates used in the preparation of the financial statements will change as new events occur, as additional information is obtained, and as the Company’s operating environment changes. Management evaluates and updates assumptions and estimates on an ongoing basis. Actual results may differ from these estimates under different assumptions or conditions. 

New Accounting Standards

In October 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-06, “Disclosure Improvements: Codification Amendments in Response to the Securities and Exchange Commission’s (“SEC”) Disclosure Update and Simplification Initiative,” (“ASU 2023-06”), which aligns the disclosure and presentation requirements of a variety of the FASB’s Accounting Standards Codification (“ASC”) Topics with the requirements described in the SEC’s Disclosure Update and Simplification Initiative. ASU 2023-06 will become effective for each amendment on the effective date of the SEC’s corresponding disclosure rule changes; however, if by June 30, 2027, the SEC has not removed the applicable requirement from Regulation S-X or Regulation S-K, the pending content of the related amendment will be removed from the Codification and will not become effective for any entity. ASU 2023-06 is not expected to have a material effect on the Company's current financial position, results of operations or financial statement disclosures.

In November 2024, FASB issued ASU 2024-03 “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)” (“ASU 2024-03”). This accounting update requires disclosure of disaggregated expense in prescribed categories underlying any relevant income statement expense caption. The updated disclosure requirements are to be adopted for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The Company is currently assessing the impact of adopting ASU 2024-03 on the consolidated financial statements and related disclosures.

In December 2025, the FASB issued ASU 2025-10, “Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities” (“ASU 2025-10”). This accounting update establishes guidance for the recognition, measurement, presentation and disclosure of government grants. The updated requirements are effective for public business entities for annual reporting periods beginning after December 15, 2028, and interim periods therein, with early adoption permitted. The Company is currently assessing the impact of adopting ASU 2025-10 on its consolidated financial statements and related disclosures.

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In April 2026, the FASB issued ASU 2026-01, “Equity (Topic 505): Initial Measurement of Paid-in-Kind Dividends on Equity-Classified Preferred Stock” (“ASU 2026-01”). This accounting update clarifies the initial measurement of paid‑in‑kind dividends on equity‑classified preferred stock. The updated requirements are effective for public business entities or annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted in an interim or annual reporting period in which financial statements have not yet been issued or made available for issuance. The Company is currently assessing the impact of adopting ASU 2026-01 on its consolidated financial statements and related disclosures.

There have been no additional material developments related to recently issued accounting standards beyond those noted above, including the expected dates of adoption and estimated effects on the Company’s unaudited condensed consolidated financial statements and note disclosures from those disclosed in the Company’s Annual Report on Form 10-K for its fiscal year ended December 31, 2025, that would be expected to impact the Company. 

 Note 2. Revenue from Contracts with Customers 
 
The Company’s revenues by activity type were as follows:

Three Months Ended
June 30,Six Months Ended
June 30,
(in thousands)2026202520262025
Residential & SMB - Incumbent Broadband Markets1
$40,282 $42,837 $81,425 $86,196 
Residential & SMB - Glo Fiber Expansion Markets2
26,289 19,796 51,117 38,240 
Commercial Fiber21,386 19,483 41,928 39,095 
RLEC & Other5,505 6,452 11,145 12,935 
Service revenue and other$93,462 $88,568 $185,615 $176,466 

_______________________________________________________
1.Revenue from residential and small and medium business (“SMB”) customers in Incumbent Broadband Markets is primarily earned through the Company’s provision of data, video and voice services over primarily HFC cable and to a lesser extent fiber to the home (“FTTH”) networks in incumbent markets.
2.Revenue from residential and SMB customers in Glo Fiber Expansion Markets is primarily earned through the Company’s provision of data, video and voice services over FTTH networks in new greenfield expansion markets.

Shentel had $20.7 million and $19.5 million of gross trade receivables from customers as of June 30, 2026 and December 31, 2025, respectively.

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Contract Assets and Liabilities

The following table presents the Company’s contract asset and contract liability balances and their respective locations in the unaudited condensed consolidated balance sheets:

(in thousands)June 30,
2026December 31,
2025
Contract assets
Prepaid expenses and other$4,240 $3,818 
Deferred charges and other
10,682 9,288 
Total contract assets$14,922 $13,106 

Contract liabilities
Advanced billings and customer deposits$14,474 $13,436 
Other liabilities11,366 11,139 
Total contract liabilities$25,840 $24,575 

The Company’s contract assets primarily include commissions incurred to acquire contracts with customers. The Company incurs commission expenses related to in-house and third-party vendors which are capitalized and amortized over the expected customer benefit period, which is approximately six years. The company incurred $1.1 million and $1.0 million in amortization of capitalized commission expenses during the three months ended June 30, 2026 and 2025, respectively. The company incurred $2.1 million and $1.9 million in amortization of capitalized commission expenses during the six months ended June 30, 2026 and 2025, respectively. This expense is recorded in selling, general and administrative expenses in the Company’s unaudited condensed consolidated statements of operations.

The Company’s contract liabilities include services that are billed in advance and recorded as deferred revenue, as well as installation fees that are charged upfront without transfer of commensurate goods or services to the customer. Shentel expects its current contract liability balances to be recognized as revenues during the twelve-month period following the respective balance sheet date. The majority of Shentel’s non-current contract liability balance is expected to be recognized as revenues within approximately 5 years. Revenues recognized related to contract liabilities existing at January 1, 2026 and 2025 were $1.1 million and $0.8 million for the three months ended June 30, 2026 and 2025, respectively, and $11.8 million and $10.7 million during the six months ended June 30, 2026 and 2025, respectively.

Note 3. Investments

Investments consisted of the following:

(in thousands)June 30,
2026December 31,
2025
SERP investments at fair value$3,306 $3,056 
Cost method investments12,853 13,250 
Equity method investments153 204 
Total investments$16,312 $16,510 

SERP investments at fair value: The fair value of the supplemental executive retirement plan (“SERP”) investments is based on unadjusted quoted prices in active markets and are classified as Level 1 of the fair value hierarchy.

Cost method investments: Shentel’s primary cost method investment in CoBank’s Class A common stock, derived from the CoBank patronage program, represented substantially all of the Company’s cost method investments with a balance of $12.2 million and $12.6 million as of June 30, 2026 and December 31, 2025, respectively. As further described in Note 8, Debt, on December 5, 2025, Shentel completed a refinancing of the Company’s debt arrangements which resulted in the repayment of the outstanding long-term debt obligations under the Previous Credit Agreement. CoBank patronage income will no longer be earned beginning in 2026.

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Note 4. Property, Plant and Equipment 

Property, plant and equipment consisted of the following:
 
($ in thousands)Estimated Useful LivesJune 30,
2026December 31,
2025
Land$4,181 $4,498 
Land improvements10 years
3,538 3,699 
Buildings and structures10 - 45 years
54,209 54,562 
Cable and fiber12 - 30 years
1,634,272 1,519,669 
Equipment and software4 - 12 years
497,619 476,939 
Total plant in service 2,193,819 2,059,367 
Plant under construction 176,383 181,060 
Total property, plant and equipment 2,370,202 2,240,427 
Less: accumulated depreciation and amortization(698,736)(638,818)
Property, plant and equipment, net $1,671,466 $1,601,609 

Property, plant and equipment, net increased primarily due to capital expenditures to support the Company’s Glo Fiber market expansion. The Company’s accounts payable as of June 30, 2026 and December 31, 2025 included amounts associated with capital expenditures of approximately $51.9 million and $55.6 million, respectively. Depreciation and amortization expense was $30.0 million and $34.6 million during the three months ended June 30, 2026 and 2025, respectively, and $61.7 million and $63.6 million during the six months ended June 30, 2026 and 2025, respectively. The Company wrote off $0.2 million and $3.0 million plant under construction inventory assets during the three and six months ended June 30, 2026, respectively. The Company wrote-off $4.2 million plant under construction inventory assets during the three and six months ended June 30, 2025. The write-off primarily related to permitting and engineering costs for markets abandoned due to changing market returns. The amounts are presented in depreciation and amortization in the Company’s unaudited condensed consolidated statements of operations. 

Note 5. Goodwill and Intangible Assets 

Goodwill and intangible assets consisted of the following:

 June 30, 2026December 31, 2025
(in thousands)Gross
Carrying
AmountAccumulated Amortization and OtherNetGross
Carrying
AmountAccumulated Amortization and OtherNet
Goodwill$67,538 $— $67,538 $67,538 $— $67,538 
Indefinite-lived intangibles:
Cable franchise rights64,334 — 64,334 64,334 — 64,334 
FCC Spectrum licenses12,122 — 12,122 12,122 — 12,122 
Railroad crossing rights and other591 — 591 557 — 557 
Total indefinite-lived intangibles77,047 — 77,047 77,013 — 77,013 

Finite-lived intangibles:
Subscriber relationships43,012 (31,600)11,412 43,012 (30,792)12,220 
Other intangibles537 (430)107 537 (417)120 
Total finite-lived intangibles43,549 (32,030)11,519 43,549 (31,209)12,340 
Total intangible assets$120,596 $(32,030)$88,566 $120,562 $(31,209)$89,353 

Amortization expense was $0.4 million and $0.5 million during the three months ended June 30, 2026 and 2025, respectively, and $0.8 million and $0.9 million during the six months ended June 30, 2026 and 2025, respectively.

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As of October 1, 2025, management concluded that the estimated fair value of the broadband reporting unit exceeded the carrying value by 8%. During the three and six months ended June 30, 2026, the Company performed goodwill impairment monitoring procedures and identified no indicators of impairment or triggering events. The Company will continue to monitor its reporting unit for any triggers that could impact recoverability of goodwill.

Note 6. Other Assets and Accrued Liabilities

Prepaid expenses and other, classified as current assets, included the following:

(in thousands)June 30,
2026December 31,
2025
Prepaid maintenance expenses$6,777 $7,055 
Broadband contract acquisition costs4,240 3,818 
Other3,645 4,325 
Prepaid expenses and other$14,662 $15,198 

Deferred charges and other assets, classified as long-term assets, included the following:

(in thousands)June 30,
2026December 31,
2025
Broadband contract acquisition costs$10,682 $9,288 
Other7,866 9,364 
Deferred charges and other assets$18,548 $18,652 

Accrued liabilities and other, classified as current liabilities, included the following:

(in thousands)June 30,
2026December 31,
2025
Accrued programming costs$3,420 $3,232 
Other14,470 10,847 
Accrued liabilities and other$17,890 $14,079 

Other liabilities, classified as long-term liabilities, included the following:

(in thousands)June 30,
2026December 31,
2025
Noncurrent portion of deferred revenue$27,105 $27,246 
Other5,985 5,094 
Other liabilities$33,090 $32,340 

Reduction in Force
On February 23, 2026, the Company announced a reduction in force of approximately 10% of its employees to prepare and align the business with the wind-down of the Glo Fiber construction phase that is expected to be substantially complete by end of 2026. During the three and six months ended June 30, 2026, Shentel recorded $0.1 million and $2.2 million, respectively, in expense primarily related to severance costs and retention bonuses, included in restructuring, integration and acquisition expense in the condensed consolidated statements of operations. The Company did not make any payments in Q1. For the six months ended June 30, 2026, the Company made severance payments of $0.4 million.

Note 7. Leases 

The Company leases various broadband network sites, fiber optic cable routes, warehouses, retail stores and office facilities for use in our business.

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The components of lease costs were as follows:

ClassificationThree Months Ended
June 30,Six Months Ended
June 30,
(in thousands)2026202520262025
Finance lease cost
Amortization of leased assetsDepreciation and amortization
$197 $180 $386 $368 
Interest on lease liabilitiesInterest expense58 22 95 46 
Operating lease costOperating expense1
1,017 1,241 2,032 2,405 
Lease cost$1,271 $1,443 $2,512 $2,819 

_________________________________________
(1)Operating lease expense is presented in cost of services or selling, general and administrative expense based on the use of the relevant facility.

The following table summarizes the expected maturity of lease liabilities as of June 30, 2026:
(in thousands)Operating LeasesFinance LeasesTotal
2026 (remainder of the year)$1,867 $2,431 $4,298 
20272,985 409 3,394 
20282,328 413 2,741 
20291,803 417 2,219 
20301,550 417 1,967 
2031 and thereafter7,097 4,929 12,026 
Total lease payments17,630 9,016 26,646 
Less: Interest(4,725)(3,427)(8,152)
Present value of lease liabilities$12,905 $5,589 $18,494 

Other information related to operating and finance leases was as follows:

June 30,
2026December 31,
2025
Finance leases
Weighted average remaining lease term (years)16.917.3
Weighted average discount rate6.9 %6.5 %
Operating leases
Weighted average remaining lease term (years)8.68.4
Weighted average discount rate6.5 %6.3 %

Three Months Ended
June 30,Six Months Ended
June 30,
(in thousands)2026202520262025
Cash paid for operating lease liabilities$1,109 $1,140 $2,221 $2,404 
Operating lease right-of-use assets obtained in exchange for new lease liabilities (includes new leases or modification of existing leases)742 372 1,473 423 

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The Company also has other operating lease arrangements which generate revenue from leasing the excess fiber capacity of its fiber network assets. Contract terms for these arrangements can range from 1 to 40 years and are billed monthly. Lease revenue from these arrangements was $1.8 million and $3.5 million for the three and six months ended June 30, 2026, respectively, and $1.7 million and $3.4 million for the three and six months ended June 30, 2025, respectively. These amounts are presented in service revenue and other in the Company’s unaudited condensed consolidated statements of operations. Contractual minimum rental receipts expected under the lease agreements in place as of June 30, 2026 is as follows:

(in thousands)Operating Leases
2026 (remainder of the year)$2,115 
20273,948 
20283,738 
20293,498 
20303,240 
2031 and thereafter15,738 
Total
$32,277 

Note 8. Debt

Shentel’s outstanding long-term debt obligations as of June 30, 2026 and December 31, 2025 are as follows:

(in thousands)Interest RatesJune 30,
2026December 31,
2025
Shentel Issuer Class A-2 Notes5.64%$489,142 $489,142 
Shentel Issuer Class B Notes6.03%78,263 78,263 
Shentel Issuer Variable Funding Note ("VFN")Floating(1)
68,000 — 
Shentel Broadband Revolving Credit Facility ("RCF")Floating(2)
93,000 75,000 
Total debt728,405 642,405 
Less: unamortized loan fees(13,378)(14,168)
Long-term debt, net of unamortized loan fees$715,027 $628,237 

(1) The VFN bears interest at one-month term SOFR plus a fixed margin. This interest rate was 5.40% at June 30, 2026.
(2) The RCF bears interest at one-month term SOFR plus a margin. The margin is variable and determined by the Company’s net leverage ratio. This interest rate was 6.15% at June 30, 2026 and 6.19% at December 31, 2025. 

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Refinancing Activities

Shentel Broadband, an indirect wholly owned subsidiary of Shentel, previously had a credit agreement which contained (i) a $150 million revolving credit facility (the “Revolver”) and $525 million in delayed draw amortizing term loans (the “Term Loans” and collectively with Revolver, the “Previous Credit Agreement”). On December 5, 2025, Shentel, through formation of Shentel Guarantor LLC, Shentel Issuer LLC (“Shentel Issuer”), Shentel Asset Entity I LLC and Shentel Asset Entity II LLC (collectively, the “ABS Entities"”), completed a refinancing of the Previous Credit Agreement with an Asset Backed Securitization (“ABS”) financing, secured by most of our fiber businesses, which resulted in the issuance of the Class A-2 Notes, Class B notes, the VFN, and a Liquidity Funding Note (“LFN”) (collectively, the “ABS Notes”). Concurrently, Shentel Broadband entered into a new RCF and the Company used the proceeds from the issuance of the ABS Notes and RCF to repay the outstanding long-term debt obligation under the Previous Credit Agreement. 

The ABS Notes include $489.1 million and $78.3 million in borrowed Class A-2 Notes and Class B Notes, respectively. In connection with the same ABS Indenture, Shentel Issuer issued the VFN which has a borrowing capacity of $175.0 million, of which Shentel has borrowed $68.0 million for the six month period ended June 30, 2026. As of June 30, 2026, the available capacity of the VFN was $1.9 million. The available capacity of the VFN will increase based on the secured fiber network revenue growth from Shentel Asset Entity I LLC and Shentel Asset Entity II LLC (each a bankruptcy-remote subsidiary of the Company), multiplied by (i) a margin as defined in the agreements governing the VFN (the “ABS Indenture”) and (ii) 6.25x multiple. 

Also, in connection with the same ABS Indenture, Shentel Issuer issued the LFN which has an undrawn borrowing commitment of $25.0 million. Shentel Issuer may draw on the LFN solely for the purpose of funding amounts due and payable for certain Priority of Payments as defined in the ABS Indenture and when restricted cash funds required by ABS Indenture are insufficient. 

The RCF, as amended March 20, 2026, has a borrowing capacity of $175.0 million, of which Shentel has borrowed $93.0 million as of June 30, 2026. 

Fair Values

The carrying amounts of the Company’s long-term debt under the Previous Credit Agreements, which had floating interest rates, approximated their fair values. Similarly, the carrying amount of the Company’s VFN and RCF, each of which has a floating interest rate, approximates its fair value. The estimated fair values of Shentel’s Class A-2 Notes and Class B Notes were based on Level 2 inputs that use interest rates available to us for debt with similar terms and remaining maturities. The fair values of Shentel’s the Class A-2 Notes and Class B Notes were as follows:

(in thousands)June 30,
2026December 31,
2025
Shentel Issuer Class A-2 Notes$491,783 $494,278 
Shentel Issuer Class B Notes78,654 77,676 

Commitment Fees

Shentel is charged commitment fees on unutilized portions of its debt. The Company recorded $0.2 million and $0.5 million related to these fees for the three and six months ended June 30, 2026, respectively, and $0.2 million and $0.4 million related to these fees for the three and six months ended June 30, 2025, respectively, which are included in interest expense in the unaudited condensed consolidated statements of operations.

Interest Expense

Shentel pays interest on a monthly basis. Interest expense recorded in Shentel’s unaudited condensed consolidated statements of operations consisted of the following:
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Three Months Ended
June 30,Six Months Ended
June 30,
(in thousands)2026202520262025
Interest expense
$11,245 $8,733 $22,371 $15,995 
Less: capitalized interest
(1,549)(2,730)(3,240)(5,100)
Interest expense, net of capitalized interest
$9,696 $6,003 $19,131 $10,895 

Maturity Dates and Other Information

Shentel Broadband’s debt includes various covenants, including total net leverage ratio and debt service coverage ratio financial covenants. 

The ABS Notes have a contractually stated anticipated repayment date (“ARD”) of December 2030 with the exception of the VFN described below. The legal final maturity date of each class of the ABS Notes is in December 2055. If Shentel has not repaid or refinanced any of the ABS Notes prior to the relevant ARD, the ABS Indenture requires mandatory prepayment of Note principle on each payment date on a pro-rata basis based on the alphanumerical designation of each class of Notes and additional interest (2.0% per annum on Class A-2 Notes, 2.4% per annum on Class B Notes, and 5.0% per annum on VFN) will be charged until the Notes are refinanced or fully redeemed. Amortization on Shentel Issuer’s ABS Notes could be required prior to the ARD if Shentel Issuer’s debt service coverage ratio is below certain thresholds in the ABS Indenture. 

Shentel Issuer has not made any borrowings under its LFN as of June 30, 2026. Amounts borrowed under the LFN do not have an anticipated repayment date and have a final maturity date of December 2055.

Shentel Issuer’s VFN matures on December 5, 2029 which may be extended, at the option of Shentel, to December 5, 2030, subject to the satisfaction of certain conditions. No principal payments on Shentel’s VFN are required prior to the final maturity date.

Shentel Broadband’s RCF matures on December 5, 2030. No principal payments on Shentel Broadband’s RCF are required prior to the final maturity date.

Shentel has executed letter of credit arrangements totaling $7.2 million that reduce the available balance of the RCF. The letter of credit arrangements were executed primarily pursuant to the requirements of the National Telecommunications and Information government grant program, discussed further in Note 12, Government Grants. These amounts are not considered borrowed, as no cash has been disbursed to Shentel or other parties.

The ABS Notes and the VFN are guaranteed by Shentel Asset Entity I LLC, Shentel Asset Entity II LLC and the ABS Issuer’s parent, Shentel Guarantor LLC (each, a “Notes Guarantor” and together with Shentel Issuer LLC, the “ABS Entities”), and such guarantees and the ABS Notes are secured by security interests in the equity interests the ABS Issuer and substantially all of the assets of the ABS Issuer and the other ABS Entities. The ABS Entities are not in any way liable for the obligations of Shentel Broadband or its non-ABS Entities. Likewise, Shentel and its non-ABS Entities have no recourse to the loans of the ABS Entities.

The RCF is fully secured by a pledge and unconditional guarantee from substantially all of Shentel Broadband’s subsidiaries, excluding the ABS Entities. This provides the lenders a security interest in substantially all of the assets of the Company, excluding assets held by the ABS Entities.

Variable Interest Entities

Under the ASC 810, Consolidation (“ASC 810”), the ABS Entities are considered, as a whole, a variable interest entity (“VIE”) and are consolidated in Shentel’s consolidated financial statements