updated 5/10/2010 12:23:48 PM ET 2010-05-10T16:23:48

U.S. Cellular Corp. said Monday that McDonald's Corp. marketing executive Mary N. Dillon will lead the wireless provider when CEO John E. Rooney retires June 1.

The appointment came as U.S. Cellular reported a 43 percent drop in first-quarter earnings, with its average revenue per customer down and expenses rising.

Dillon, 48, serves as global chief marketing officer at McDonald's, where she has worked since 2005. Prior to that, she was president of PepsiCo Inc.'s Quaker Foods division.

Telephone and Data Systems Inc., which owns an 82 percent stake in U.S. Cellular, had said in February that Rooney would retire as CEO of U.S. Cellular this year and hired an executive search firm to replace him. Rooney has been president and CEO since since 2000.

In its earnings report, U.S. Cellular said it added 24,000 net subscribers, compared with the same quarter a year ago. But while it added 33,000 prepaid customers, the company lost 9,000 postpay customers — those who sign long-term contracts and generally provide more revenue.

Average revenue per customer, a closely watched gauge in the wireless industry, fell slightly to $52.42 from $52.64.

The company's net income came to $48.2 million, or 55 cents per share, compared with $84.5 million, or 97 cents per share, a year ago. That's a penny higher than the average forecast from analysts, according to Thomson Reuters.

Revenue slipped 3 percent to $1.02 billion from $1.05 billion a year ago. Analysts were looking for $1.06 billion.

Operating expenses climbed 1 percent to $945.3 million.

U.S. Cellular shares rose $2.77, or 7.2 percent, to $41.05 in midday trading, helped by broader market gains. Telephone and Data Systems shares rose $1.23, or 4 percent, to $32.58.

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