v3.26.1
Derivatives
 3 Months Ended
Mar. 31, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivatives Derivatives:
The Company enters into interest rate swap agreements to mitigate its exposure to the variability in cash flows related to its variable rate debt outstanding under its credit agreements. As of December 31, 2025, the Company was party to four pay fixed, receive variable interest rate swap agreements with two bank counterparties. The first swap was assumed by the Company in connection with the Merger and has a notional value of $200.0 million, fixed rate paid of 4.1730% and matures on October 31, 2029. On October 6, 2025, the Company entered into three new interest rate swap agreements consisting of a swap with a notional value of $400.0 million, fixed rate paid of 3.332%, maturing on October 31, 2028; a swap with a notional value of $400.0 million, fixed rate paid of 3.365%, maturing on October 31, 2029; and a swap with a notional value of $400.0 million, fixed rate paid of 3.417%, maturing on October 31, 2030. For all four 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.

In conjunction with the first quarter 2026 debt refinancing transactions previously discussed in Note 5, which included the repayment of the Windstream Term Loan, on January 28, 2026, the Company terminated a portion of each of the three $400.0 million notional value interest rates swaps. For each affected interest rate swap, $250.0 million of the original $400.0 million notional value was terminated, and accordingly, the remaining notional value for each of the three interest rate swaps was $150.0 million ($450.0 million in the aggregate). Upon termination, the Company received aggregate cash proceeds of $2.6 million from the respective bank counterparties and the Company discontinued hedge accounting for the terminated portion of the three interest rate swaps. Because the Company concluded that it was probable that a portion of the original hedged transactions (future variable interest payments) would still occur, the risk of the variability of future cash flows was not fully eliminated upon discontinuing hedge accounting. Accordingly, unrealized gains deferred in accumulated other comprehensive income related to the discontinued hedging relationships as of January 28, 2026, of approximately $2.8 million are being amortized on a straight-line basis to interest expense over the remaining contractual terms of the underlying interest rate swaps. Unrealized gains related to the portion of the forecasted variable interest rate payments that were probable not to occur of approximately $1.0 million were immediately recognized in other income, net.

In addition to the interest rate swaps discussed above, 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.

Set forth below is information related to the Company’s cash flow hedges:

(Millions)March 31,
2026		December 31,
2025
Designated portion of cash flow hedges, measured at fair value:
Other current assets$1.2 $0.3 
Other assets$1.3 $— 
Other current liabilities$1.0 $1.7 
Other liabilities$3.3 $5.5 
Accumulated other comprehensive income (loss)$1.1 $(2.5)
De-designated portion of cash flow hedges, unamortized value
Accumulated other comprehensive income$2.7 $— 

Changes in derivative instruments were as follows for the three months ended March 31:

(Millions)20262025
Designated cash flow hedges:
Changes in fair value, net of tax$7.9 $(0.1)
Reclassification of unrealized losses, net of tax$(1.6)$0.2 
De-designated cash flow hedges:
Reclassification of unrealized losses, net of tax$(0.1)$— 
As of March 31, 2026, the Company expects to recognize net gains of $1.3 million, net of taxes, in interest expense during the next twelve months for interest settlements related to its interest rate swap agreement.

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 counterparties risk and determined that no substantial risk of default exists as of March 31, 2026, 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.

The following table presents the Company’s derivative assets subject to an enforceable master netting arrangement as of March 31, 2026 and December 31, 2025.

Gross Amount
of Assets
Presented in
the Condensed
Consolidated
Balance Sheets		Gross Amount Not Offset
in the Condensed Consolidated
Balance Sheets
(Millions)Financial
Instruments		Cash
Collateral
Received		Net
Amount
March 31, 2026
Interest rate swaps$2.5 $(2.5)$— $— 
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 Condensed
Consolidated
Balance Sheets		Gross Amount Not Offset
in the Condensed Consolidated
Balance Sheets
(Millions)Financial
Instruments		Cash
Collateral
Received		Net
Amount
March 31, 2026
Interest rate swaps$4.3 $(2.5)$— $1.8 
December 31, 2025:
Interest rate swaps$7.2 $(0.3)$— $6.9