Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Jul. 27, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | T-MOBILE US, INC. | |
Trading Symbol | TMUS | |
Entity Central Index Key | 1,283,699 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 847,231,474 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash and cash equivalents | $ 215 | $ 1,219 |
Accounts receivable, net of allowances of $70 and $86 | 1,630 | 1,915 |
Equipment installment plan receivables, net | 2,308 | 2,290 |
Accounts receivable from affiliates | 11 | 22 |
Inventories | 998 | 1,566 |
Other current assets | 1,929 | 1,903 |
Total current assets | 7,091 | 8,915 |
Property and equipment, net | 22,375 | 22,196 |
Goodwill | 1,901 | 1,683 |
Spectrum licenses | 35,532 | 35,366 |
Other intangible assets, net | 260 | 217 |
Equipment installment plan receivables due after one year, net | 1,222 | 1,274 |
Other assets | 1,311 | 912 |
Total assets | 69,692 | 70,563 |
Current liabilities | ||
Accounts payable and accrued liabilities | 6,686 | 8,528 |
Payables to affiliates | 190 | 182 |
Short-term debt | 1,004 | 1,612 |
Short-term debt to affiliates | 320 | 0 |
Deferred revenue | 722 | 779 |
Other current liabilities | 359 | 414 |
Total current liabilities | 9,281 | 11,515 |
Long-term debt | 12,065 | 12,121 |
Long-term debt to affiliates | 14,581 | 14,586 |
Tower obligations | 2,574 | 2,590 |
Deferred tax liabilities | 4,087 | 3,537 |
Deferred rent expense | 2,746 | 2,720 |
Other long-term liabilities | 968 | 935 |
Total long-term liabilities | 37,021 | 36,489 |
Commitments and contingencies (Note 14) | ||
Stockholders' equity | ||
Common Stock, par value $0.00001 per share, 1,000,000,000 shares authorized; 848,736,488 and 860,861,998 shares issued, 847,225,746 and 859,406,651 shares outstanding | 0 | 0 |
Additional paid-in capital | 37,786 | 38,629 |
Treasury stock, at cost, 1,510,742 and 1,455,347 shares issued | (7) | (4) |
Accumulated other comprehensive income | 0 | 8 |
Accumulated deficit | (14,389) | (16,074) |
Total stockholders' equity | 23,390 | 22,559 |
Total liabilities and stockholders' equity | $ 69,692 | $ 70,563 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Allowances | $ 70 | $ 86 |
Common stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 848,736,488 | 860,861,998 |
Common stock, shares outstanding (in shares) | 847,225,746 | 859,406,651 |
Treasury stock, at cost (in shares) | 1,510,742 | 1,455,347 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenues | ||||
Branded postpaid revenues | $ 5,164 | $ 4,820 | $ 10,234 | $ 9,545 |
Branded prepaid revenues | 2,402 | 2,334 | 4,804 | 4,633 |
Wholesale revenues | 275 | 234 | 541 | 504 |
Roaming and other service revenues | 90 | 57 | 158 | 92 |
Total service revenues | 7,931 | 7,445 | 15,737 | 14,774 |
Equipment revenues | 2,325 | 2,506 | 4,678 | 4,549 |
Other revenues | 315 | 262 | 611 | 503 |
Total revenues | 10,571 | 10,213 | 21,026 | 19,826 |
Operating expenses | ||||
Cost of services, exclusive of depreciation and amortization shown separately below | 1,530 | 1,518 | 3,119 | 2,926 |
Cost of equipment sales | 2,772 | 2,846 | 5,617 | 5,532 |
Selling, general and administrative | 3,185 | 2,915 | 6,349 | 5,870 |
Depreciation and amortization | 1,634 | 1,519 | 3,209 | 3,083 |
Gains on disposal of spectrum licenses | 0 | (1) | 0 | (38) |
Total operating expense | 9,121 | 8,797 | 18,294 | 17,373 |
Operating income | 1,450 | 1,416 | 2,732 | 2,453 |
Other income (expense) | ||||
Interest expense | (196) | (265) | (447) | (604) |
Interest expense to affiliates | (128) | (131) | (294) | (231) |
Interest income | 6 | 6 | 12 | 13 |
Other expense, net | (64) | (92) | (54) | (90) |
Total other expense, net | (382) | (482) | (783) | (912) |
Income before income taxes | 1,068 | 934 | 1,949 | 1,541 |
Income tax expense | (286) | (353) | (496) | (262) |
Net income | 782 | 581 | 1,453 | 1,279 |
Dividends on preferred stock | 0 | (14) | 0 | (28) |
Net income attributable to common stockholders | 782 | 567 | 1,453 | 1,251 |
Net income | 782 | 581 | 1,453 | 1,279 |
Other comprehensive income, net of tax | ||||
Unrealized gain on available-for-sale securities, net of tax effect of $1, $1, $0 and $2 | 3 | 1 | 0 | 2 |
Other comprehensive income | 3 | 1 | 0 | 2 |
Total comprehensive income | $ 785 | $ 582 | $ 1,453 | $ 1,281 |
Earnings per share | ||||
Basic (in USD per share) | $ 0.92 | $ 0.68 | $ 1.71 | $ 1.51 |
Diluted (in USD per share) | $ 0.92 | $ 0.67 | $ 1.69 | $ 1.47 |
Weighted average shares outstanding | ||||
Basic (in shares) | 847,660,488 | 830,971,528 | 851,420,686 | 829,356,255 |
Diluted (in shares) | 852,040,670 | 870,457,181 | 858,728,832 | 870,854,386 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Income Statement [Abstract] | ||||
Unrealized gain on available-for-sale securities, net of tax effect of $1, $1, $0 and $2 | $ 1 | $ 1 | $ 0 | $ 2 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Operating activities | ||||
Net income | $ 782 | $ 581 | $ 1,453 | $ 1,279 |
Adjustments to reconcile net income to net cash provided by operating activities | ||||
Depreciation and amortization | 1,634 | 1,519 | 3,209 | 3,083 |
Stock-based compensation expense | 112 | 72 | 209 | 139 |
Deferred income tax expense | 272 | 345 | 478 | 248 |
Bad debt expense | 75 | 82 | 129 | 175 |
Losses from sales of receivables | 27 | 80 | 79 | 175 |
Deferred rent expense | 7 | 20 | 11 | 40 |
Losses on redemption of debt | 90 | 88 | 122 | 86 |
Gains on disposal of spectrum licenses | 0 | (1) | 0 | (38) |
Changes in operating assets and liabilities | ||||
Accounts receivable | (1,136) | (629) | (2,009) | (1,654) |
Equipment installment plan receivables | (286) | (584) | (508) | (793) |
Inventories | 125 | (185) | 158 | (141) |
Other current and long-term assets | (248) | (135) | (116) | (146) |
Accounts payable and accrued liabilities | (79) | 56 | (1,107) | (595) |
Other current and long-term liabilities | (105) | (189) | (60) | (144) |
Other, net | (9) | (14) | (17) | 0 |
Net cash provided by operating activities | 1,261 | 1,106 | 2,031 | 1,714 |
Investing activities | ||||
Purchases of property and equipment, including capitalized interest of $102, $34, $145 and $82 | (1,629) | (1,347) | (2,995) | (2,875) |
Purchases of spectrum licenses and other intangible assets, including deposits | (28) | (5,791) | (79) | (5,805) |
Proceeds related to beneficial interests in securitization transactions | 1,323 | 882 | 2,618 | 2,016 |
Acquisition of companies, net of cash acquired | (5) | 0 | (338) | 0 |
Other, net | 33 | 5 | 26 | (3) |
Net cash used in investing activities | (306) | (6,251) | (768) | (6,667) |
Financing activities | ||||
Proceeds from issuance of long-term debt | 0 | 4,485 | 2,494 | 9,980 |
Payments of consent fees related to long-term debt | (38) | 0 | (38) | 0 |
Proceeds from borrowing on revolving credit facility | 2,070 | 1,855 | 4,240 | 1,855 |
Repayments of revolving credit facility | (2,195) | (1,175) | (3,920) | (1,175) |
Repayments of capital lease obligations | (155) | (119) | (327) | (209) |
Repayments of short-term debt for purchases of inventory, property and equipment, net | 0 | (292) | 0 | (292) |
Repayments of long-term debt | (2,350) | (6,750) | (3,349) | (10,230) |
Repurchases of common stock | (405) | 0 | (1,071) | 0 |
Tax withholdings on share-based awards | (10) | (3) | (84) | (95) |
Dividends on preferred stock | 0 | (14) | 0 | (28) |
Cash payments for debt prepayment or debt extinguishment costs | (181) | (159) | (212) | (188) |
Other, net | (3) | (3) | 0 | 16 |
Net cash used in financing activities | (3,267) | (2,175) | (2,267) | (366) |
Change in cash and cash equivalents | (2,312) | (7,320) | (1,004) | (5,319) |
Cash and cash equivalents | ||||
Beginning of period | 2,527 | 7,501 | 1,219 | 5,500 |
End of period | 215 | 181 | 215 | 181 |
Supplemental disclosure of cash flow information | ||||
Interest payments, net of amounts capitalized | 559 | 727 | 937 | 1,222 |
Income tax payments | 10 | 6 | 11 | 21 |
Noncash beneficial interest obtained in exchange for securitized receivables | 1,205 | 992 | 2,333 | 2,008 |
Noncash investing and financing activities | ||||
Changes in accounts payable for purchases of property and equipment | (386) | 8 | (750) | (317) |
Leased devices transferred from inventory to property and equipment | 280 | 270 | 584 | 513 |
Returned leased devices transferred from property and equipment to inventory | (90) | (273) | (172) | (470) |
Issuance of short-term debt for financing of property and equipment | 54 | 2 | 291 | 290 |
Assets acquired under capital lease obligations | $ 176 | $ 313 | $ 318 | $ 597 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Cash Flows Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Statement of Cash Flows [Abstract] | ||||
Capitalized interest | $ 102 | $ 34 | $ 145 | $ 82 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Significant Accounting Policies | Note 1 – Summary of Significant Accounting Policies Basis of Presentation The unaudited condensed consolidated financial statements of T-Mobile US, Inc. (“T-Mobile,” “we,” “our,” “us” or the “Company”) include all adjustments of a normal recurring nature necessary for the fair presentation of the results for the interim periods presented. The results for the interim periods are not necessarily indicative of those for the full year. The condensed consolidated financial statements should be read in conjunction with our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2017 . The condensed consolidated financial statements include the balances and results of operations of T-Mobile and our consolidated subsidiaries. We consolidate majority-owned subsidiaries over which we exercise control, as well as variable interest entities (“VIE”) where we are deemed to be the primary beneficiary and VIEs which cannot be deconsolidated, such as those related to Tower obligations (Tower obligations are included in VIEs related to the 2012 Tower Transaction. See Note 8 - Tower Obligations included in our Annual Report on Form 10-K for the year ended December 31, 2017 ). Intercompany transactions and balances have been eliminated in consolidation. The preparation of financial statements in conformity with United States (“U.S.”) generally accepted accounting principles (“GAAP”) requires our management to make estimates and assumptions which affect the financial statements and accompanying notes. Estimates are based on historical experience, where applicable, and other assumptions which our management believes are reasonable under the circumstances. These estimates are inherently subject to judgment and actual results could differ from those estimates. Accounting Pronouncements Adopted During the Current Year Revenue In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” and has since modified the standard with several ASUs (collectively, the “new revenue standard”). The new revenue standard requires entities to recognize revenue through the application of a five-step model, which includes: identification of the contract; identification of the performance obligations; determination of the transaction price; allocation of the transaction price to the performance obligations; and recognition of revenue as the entity satisfies the performance obligations. We adopted the new revenue standard on January 1, 2018, using the modified retrospective method with the cumulative effect of initially applying the guidance recognized at the date of initial application. Comparative information has not been restated and continues to be reported under the standards in effect for those periods. We have applied the new revenue standard only to contracts not completed as of the date of initial application, referred to as open contracts. We have elected the practical expedient that permits an entity to reflect the aggregate effect of all of the modifications (on a contract-by-contract basis) that occurred before the date of initial application in determining the transaction price, identifying the satisfied and unsatisfied performance obligations, and allocating the transaction price to the performance obligations. Electing this practical expedient does not have a significant impact on our financial statements due to the short-term duration of most of our contracts and the nature of our contract modifications. We have implemented significant new revenue accounting systems, processes and internal controls over revenue recognition to assist us in the application of the new revenue standard. Revenue Recognition We primarily generate our revenue from providing wireless services to customers and selling or leasing devices and accessories. Our contracts with customers may involve multiple performance obligations, which include wireless services, wireless devices or a combination thereof, and we allocate the transaction price between each performance obligation based on its relative standalone selling price. Significant Judgments The most significant judgments affecting the amount and timing of revenue from contracts with our customers include the following items: • For transactions where we recognize a significant financing component, judgment is required to determine the discount rate. For equipment installment plan (“EIP”) sales, the discount rate used to adjust the transaction price primarily reflects current market interest rates and the estimated credit risk of the customer. • Our products are generally sold with a right of return, which is accounted for as variable consideration when estimating the amount of revenue to recognize. Expected device returns are estimated based on historical experience. • Promotional bill credits offered to a customer on an equipment sale that are paid over time and are contingent on the customer maintaining a service contract may result in an extended service contract based on whether a substantive penalty is deemed to exist. Determining whether contingent bill credits result in a substantive termination penalty, and determining the term over which a substantive termination penalty exists, may require significant judgment. • For capitalized contract costs, determining the amortization period as well as assessing the indicators of impairment may require significant judgment. • The determination of the standalone selling price for contracts that involve more than one product or service (or performance obligation) may require significant judgment. • The identification of distinct performance obligations within our service plans may require significant judgment. Wireless Services Revenue We generate our wireless services revenues from providing access to, and usage of, our wireless communications network. Service revenues also include revenues earned for providing value added services to customers, such as handset insurance services. Service contracts are billed monthly either in advance or arrears, or are prepaid. Generally, service revenue is recognized as we satisfy our performance obligation to transfer service to our customers. We typically satisfy our stand-ready performance obligations, including unlimited wireless services, evenly over the contract term. For usage-based and prepaid wireless services, we satisfy our performance obligations when services are rendered. Revenue for service contracts that we assess are not probable of collection is not recognized until the contract is completed and cash is received. Collectibility is re-assessed when there is a significant change in facts or circumstances. Our assessment of collectibility considers whether we may limit our exposure to credit risk through our right to stop transferring additional service in the event the customer is delinquent. Consideration payable to a customer is treated as a reduction of the total transaction price, unless the payment is in exchange for a distinct good or service, such as certain commissions paid to dealers. Revenue is recorded net of costs paid to another party for performance obligations where we arrange for the other party to transfer goods or services to the customer (i.e., when we are acting as an agent). For example, performance obligations relating to services provided by third-party content providers where T-Mobile neither controls a right to the content provider’s service nor controls the underlying service itself are presented net because T-Mobile is acting as an agent. Federal Universal Service Fund and other regulatory fees are assessed by various governmental authorities in connection with the services we provide to our customers and are included in Cost of services. When we separately bill and collect these regulatory fees from customers, they are recorded in Total service revenues in our Condensed Consolidated Statements of Comprehensive Income . We have made an accounting policy election to exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by T-Mobile from a customer (for example, sales, use, value added, and some excise taxes). Equipment Revenues We generate equipment revenues from the sale or lease of mobile communication devices and accessories. For performance obligations related to equipment contracts, we typically transfer control at a point in time when the device or accessory is delivered to, and accepted by, the customer or dealer. We have elected to account for shipping and handling activities that occur after control of the related good transfers as fulfillment activities instead of assessing such activities as performance obligations. We establish provisions for estimated device returns based on historical experience. Equipment sales not probable of collection are generally recorded as payments are received. Our assessment of collectibility considers contract terms such as down payments that reduce our exposure to credit risk. We offer certain customers the option to pay for devices and accessories in installments using an EIP. Generally, we recognize as a reduction of the total transaction price the effects of a financing component in contracts where customers purchase their devices and accessories on an EIP with a term of more than one year, including those financing components that are not considered to be significant to the contract. However, we have elected the practical expedient to not recognize the effects of a significant financing component for contracts where we expect, at contract inception, that the period between the transfer of a performance obligation to a customer and the customer’s payment for that performance obligation will be one year or less. In addition, for customers who enroll in our Just Upgrade My Phone (“JUMP!” ® ) program, we recognize a liability based on the estimated fair value of the specified-price trade-in right guarantee. The fair value of the guarantee is deducted from the transaction price under the new revenue standard, and the remaining transaction price is allocated to other elements of the contract, including service and equipment performance obligations. See “Guarantee Liabilities” in Note 1 - Summary of Significant Accounting Policies included in our Annual Report on Form 10-K for the year ended December 31, 2017. In 2015, we introduced JUMP! On Demand, which allows customers to lease a device and upgrade their leased wireless device for a new device up to one time per month. To date, all of our leased wireless devices are accounted for as operating leases and estimated contract consideration is allocated between lease elements and non-lease elements (such as service and equipment performance obligations) based on the relative standalone selling price of each performance obligation in the contract. Lease revenues are recorded as equipment revenues and recognized as earned on a straight-line basis over the lease term. Lease revenues on contracts not probable of collection are limited to the amount of payments received. See “Property and Equipment” in Note 1 - Summary of Significant Accounting Policies included in our Annual Report on Form 10-K for the year ended December 31, 2017. Contract Balances Generally, T-Mobile devices and service plans are available at standard prices, which are maintained on price lists and published on our website and/or within our retail stores. For contracts that involve more than one product or service that are identified as separate performance obligations, the transaction price is allocated to the performance obligations based on their relative standalone selling prices. Standalone selling price is the price at which T-Mobile would sell the good or service separately to a customer and is most commonly evidenced by the price at which T-Mobile sells that good or service separately in similar circumstances and to similar customers. A contract asset is recorded when revenue is recognized in advance of our right to receive consideration (i.e., we must perform additional services in order to receive consideration). Amounts are recorded as receivables when our right to consideration is unconditional. When consideration is received or we have an unconditional right to consideration in advance of delivery of goods or services, a contract liability is recorded. The transaction price can include non-refundable upfront fees, which are allocated to the identifiable performance obligations. Contract assets are included in Other current assets and Other assets and contract liabilities are included in Deferred revenue in our Condensed Consolidated Balance Sheets . Contract Modifications Our service contracts allow customers to frequently modify their contracts without incurring penalties in many cases. Each time a contract is modified, we evaluate the change in scope or price of the contract to determine if the modification should be treated as a separate contract, as if there is a termination of the existing contract and creation of a new contract, or if the modification should be considered a change associated with the existing contract. We typically do not have significant impacts from contract modifications. Contract Costs We incur certain incremental costs to obtain a contract that we expect to recover, such as sales commissions. We record an asset when these incremental costs to obtain a contract are incurred and amortize them on a systematic basis that is consistent with the transfer to the customer of the goods or services to which the asset relates. We amortize deferred costs incurred to obtain service contracts on a straight-line basis over the term of the initial contract and anticipated renewal contracts to which the costs relate. However, we have elected the practical expedient permitting expensing of costs to obtain a contract when the expected amortization period is one year or less. Incremental costs to obtain equipment contracts (e.g., commissions paid on device and accessory sales) are recognized when the equipment is transferred to the customer. Financial Statement Impacts of Applying the New Revenue Standard The cumulative effect of initially applying the new revenue standard to all open contracts as of January 1, 2018 is as follows: January 1, 2018 (in millions) Beginning Balance Cumulative Effect Adjustment Beginning Balance, As Adjusted Assets Other current assets $ 1,903 $ 140 $ 2,043 Other assets 912 150 1,062 Liabilities and Stockholders’ Equity Deferred revenue $ 779 $ 4 $ 783 Deferred tax liabilities 3,537 73 3,610 Accumulated deficit (16,074 ) 213 (15,861 ) The most significant impacts upon adoption of the new revenue standard on January 1, 2018 include the following items: • A deferred contract cost asset of $150 million was recorded at transition in Other assets in our Condensed Consolidated Balance Sheets for incremental contract acquisition costs paid on open contracts, which consists primarily of commissions paid to acquire branded postpaid service contracts; and • A contract asset of $140 million was recorded at transition in Other current assets in our Condensed Consolidated Balance Sheets primarily for contracts with promotional bill credits offered to customers on equipment sales that are paid over time and are contingent on the customer maintaining a service contract. Financial statement results as reported under the new revenue standard as compared to the previous revenue standard for the three and six months ended and as of June 30, 2018 are as follows: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 (in millions, except per share amounts) Previous Revenue Standard New Revenue Standard Change Previous Revenue Standard New Revenue Standard Change Revenues Branded postpaid revenues $ 5,162 $ 5,164 $ 2 $ 10,261 $ 10,234 $ (27 ) Branded prepaid revenues 2,404 2,402 (2 ) 4,807 4,804 (3 ) Wholesale revenues 275 275 — 541 541 — Roaming and other service revenues 90 90 — 158 158 — Total service revenues 7,931 7,931 — 15,767 15,737 (30 ) Equipment revenues 2,229 2,325 96 4,505 4,678 173 Other revenues 315 315 — 611 611 — Total revenues 10,475 10,571 96 20,883 21,026 143 Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below 1,504 1,530 26 3,093 3,119 26 Cost of equipment sales 2,779 2,772 (7 ) 5,624 5,617 (7 ) Selling, general and administrative 3,192 3,185 (7 ) 6,404 6,349 (55 ) Depreciation and amortization 1,634 1,634 — 3,209 3,209 — Total operating expenses 9,109 9,121 12 18,330 18,294 (36 ) Operating income 1,366 1,450 84 2,553 2,732 179 Total other expense, net (382 ) (382 ) — (783 ) (783 ) — Income before income taxes 984 1,068 84 1,770 1,949 179 Income tax expense (264 ) (286 ) (22 ) (450 ) (496 ) (46 ) Net income $ 720 $ 782 $ 62 $ 1,320 $ 1,453 $ 133 Earnings per share Basic earnings per share $ 0.85 $ 0.92 $ 0.07 $ 1.55 $ 1.71 $ 0.16 Diluted earnings per share $ 0.85 $ 0.92 $ 0.07 $ 1.54 $ 1.69 $ 0.15 June 30, 2018 (in millions) Previous Revenue Standard New Revenue Standard Change Assets Other current assets $ 1,861 $ 1,929 $ 68 Other assets 901 1,311 410 Liabilities and Stockholders’ Equity Deferred revenue $ 709 $ 722 $ 13 Deferred tax liabilities 3,968 4,087 119 Accumulated deficit (14,735 ) (14,389 ) 346 The most significant impacts to financial statement results as reported under the new revenue standard as compared to the previous revenue standard for the current reporting period are as follows: • Under the new revenue standard, certain commissions paid to dealers previously recognized as a reduction to Equipment revenues in our Condensed Consolidated Statements of Comprehensive Income are now recorded as commission costs in Selling, general and administrative expense. • Contract costs capitalized for new contracts will accumulate in Other assets in our Condensed Consolidated Balance Sheets during 2018. As a result, there will be a net benefit to Operating income in our Condensed Consolidated Statements of Comprehensive Income during 2018 as capitalization of costs exceed amortization. As capitalized costs amortize into expense over time, the accretive benefit to Operating income anticipated in 2018 is expected to moderate in 2019 and normalize in 2020. • For contracts with promotional bill credits that are contingent on the customer maintaining a service contract that result in an extended service contract, a contract asset is recorded when control of the equipment transfers to the customer and is subsequently amortized as a reduction to Total service revenues in our Condensed Consolidated Statements of Comprehensive Income over the extended contract term. See disclosures related to Contracts with Customers under the new revenue standard in Note 11 - Revenue from Contracts with Customers . Statement of Cash Flows In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” (the “new cash flow standard”). The new cash flow standard is intended to reduce current diversity in practice and provides guidance on how certain cash receipts and payments are presented and classified in the statement of cash flows. We adopted the new cash flow standard on January 1, 2018, which was the date it became effective for us. We have applied the new cash flow standard retrospectively to all periods presented. The new cash flow standard impacted the presentation of cash flows related to our beneficial interests in securitization transactions, which is the deferred purchase price, resulting in a reclassification of cash inflows from Operating activities to Investing activities of $1.3 billion and $882 million for the three months ended June 30, 2018 and 2017 , respectively, and $2.6 billion and $2.0 billion for the six months ended June 30, 2018 and 2017 , respectively, in our Condensed Consolidated Statements of Cash Flows . The new cash flow standard also impacted the presentation of our cash payments for debt prepayment and debt extinguishment costs, resulting in a reclassification of cash outflows from Operating activities to Financing activities of $181 million and $159 million for the three months ended June 30, 2018 and 2017 , respectively, and $212 million and $188 million for the six months ended June 30, 2018 and 2017 , respectively, in our Condensed Consolidated Statements of Cash Flows . Financial Instruments In January 2016, the FASB issued ASU 2016-01, “Financial Instruments (Topic 825): Recognition and Measurement of Financial Assets and Financial Liabilities,” and has since modified the standard in February 2018 with ASU 2018-03, “Technical Corrections and Improvements to Financial Instruments - Overall” (Subtopic 825-10). The standard addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The standard became effective for us, and we adopted the standard, on January 1, 2018. The standard requires the impact of adoption to be recorded to retained earnings under a modified retrospective approach. The implementation of this standard did not have a material impact on our condensed consolidated financial statements . Income Taxes In October 2016, the FASB issued ASU 2016-16, “Accounting for Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory.” The standard requires that the income tax impact of intra-entity sales and transfers of property, except for inventory, be recognized when the transfer occurs. The standard became effective for us, and we adopted the standard, on January 1, 2018. The standard requires any deferred taxes not yet recognized on intra-entity transfers to be recorded to retained earnings under a modified retrospective approach. The implementation of this standard did not have a material impact on our condensed consolidated financial statements . Accounting Pronouncements Not Yet Adopted Leases In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” and has since modified the standard in January 2018 with ASU 2018-01, “Land Easement Practical Expedient for Transition to Topic 842” and in July 2018 with ASU 2018-11 “Targeted Improvements” (collectively, the “new lease standard”). The new lease standard requires all lessees to report a right-of-use asset and a lease liability for most leases. The income statement recognition is similar to existing lease accounting and is based on lease classification. The new lease standard requires lessees and lessors to classify most leases using principles similar to existing lease accounting. For lessors, the new lease standard modifies the classification criteria and the accounting for sales-type and direct financing leases. We are currently evaluating the new lease standard, which will require recognizing and measuring leases at the beginning of the earliest period presented using a modified retrospective approach. Our evaluation includes assessing which of our arrangements qualify as a lease, and aggregating lease data and related information as well as determining whether previous conclusions for certain transactions, such as failed sale leaseback arrangements under the previous lease standard, Leases (Topic 840), would change under the new lease standard. We plan to adopt the new lease standard when it becomes effective for us beginning January 1, 2019, and expect the adoption of the new lease standard will result in the recognition of right-of-use assets and lease liabilities that have not previously been recorded, which will have a material impact on our condensed consolidated financial statements . We are in the process of implementing significant new lease accounting systems, processes and internal controls over lease recognition, which will ultimately assist in the application of the new lease standard. Financial Instruments In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” The standard requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectability of the reported amount. The standard will become effective for us beginning January 1, 2020, and will require a cumulative-effect adjustment to Accumulated deficit as of the beginning of the first reporting period in which the guidance is effective (that is, a modified-retrospective approach). Early adoption is permitted for us as of January 1, 2019. We are currently evaluating the impact this guidance will have on our condensed consolidated financial statements and the timing of adoption. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the Securities and Exchange Commission (“SEC”) did not have, or are not believed by management to have, a significant impact on our present or future consolidated financial statements. |
Significant Transactions
Significant Transactions | 6 Months Ended |
Jun. 30, 2018 | |
Significant Transactions Disclosure [Abstract] | |
Significant Transactions | Note 2 - Significant Transactions Business Combinations During the first half of 2018, we completed the following acquisitions which were accounted for as business combinations: • On January 1, 2018, we closed on our previously announced Unit Purchase Agreement to acquire the remaining equity in Iowa Wireless Services, LLC (“IWS”), a 54% owned unconsolidated subsidiary, for a purchase price of $25 million . • On January 22, 2018, we completed our acquisition of television innovator Layer3 TV, Inc. (“Layer3 TV”) for cash consideration of $318 million . Proposed Sprint Transaction On April 29, 2018, we entered into a Business Combination Agreement (the “Business Combination Agreement”) to merge with Sprint Corporation (“Sprint”). See Note 3 - Business Combinations for further information. Hurricane Impacts During the first quarter of 2018, we recognized $36 million in incremental costs to maintain services in Puerto Rico related to hurricanes that occurred in 2017. Additional costs incurred during the second quarter were immaterial and are expected to be immaterial during the remainder of 2018. We received reimbursement payments from our insurance carriers for property damage of $94 million during the first quarter of 2018, previously accrued for as a receivable as of December 31, 2017, and $70 million during the second quarter of 2018. We continue to work with our insurance carriers and expect additional reimbursement related to these hurricanes in future periods. The following table shows the hurricane impacts in our Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2018 are as follows: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 (in millions, except per share amounts) Gross Reim- Net Gross Reim- Net Increase (decrease) Cost of services $ — $ (70 ) $ (70 ) $ 36 $ (70 ) $ (34 ) Total operating expenses $ — $ (70 ) $ (70 ) $ 36 $ (70 ) $ (34 ) Operating income (loss) $ — $ 70 $ 70 $ (36 ) $ 70 $ 34 Net income (loss) $ — $ 45 $ 45 $ (23 ) $ 45 $ 22 Earnings per share - basic $ — $ 0.06 $ 0.06 $ (0.03 ) $ 0.06 $ 0.03 Earnings per share - diluted $ — $ 0.06 $ 0.06 $ (0.03 ) $ 0.06 $ 0.03 Sales of Certain Receivables In February 2018, the service receivable sale agreement was amended to extend the scheduled expiration date to March 2019. See Note 5 – Sales of Certain Receivables for further information. Debt During the first half of 2018, we completed significant transactions with both third parties and affiliates related to the issuance, borrowing and redemption of debt. See Note 9 - Debt for further information. Repurchases of Common Stock During the first half of 2018, we made additional repurchases of our common stock. Additionally, during the first quarter of 2018, Deutsche Telekom AG (“DT”), our majority stockholder and an affiliated purchaser, made additional purchases of our common stock. See Note 12 – Repurchases of Common Stock for further information. |
Business Combinations
Business Combinations | 6 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Business Combinations | Note 3 - Business Combinations Proposed Sprint Transaction On April 29, 2018, we entered into a Business Combination Agreement to merge with Sprint in an all-stock transaction at a fixed exchange ratio of 0.10256 shares of T-Mobile common stock for each share of Sprint common stock, or 9.75 shares of Sprint common stock for each share of T-Mobile common stock (the “Merger”). The combined company will be named “T-Mobile” and, as a result of the Merger, is expected to be able to rapidly launch a nationwide 5G network, accelerate innovation and increase competition in the U.S. wireless, video and broadband industries. Neither T-Mobile nor Sprint on its own could generate comparable benefits to consumers. The Merger and the other transactions contemplated by the Business Combination Agreement (the “Transactions”) have been approved by the boards of directors of T-Mobile and Sprint. Following the Merger, it is anticipated that Deutsche Telekom AG (“Deutsche Telekom”) and SoftBank Group Corp. (“SoftBank”) will hold, directly or indirectly, on a fully diluted basis, approximately 41.7% and 27.4% , respectively, of the outstanding T-Mobile common stock, with the remaining approximately 30.9% of the outstanding T-Mobile common stock held by other stockholders, based on closing share prices and certain other assumptions as of the date of the Business Combination Agreement. In connection with the entry into the Business Combination Agreement, T-Mobile USA, Inc. (“T-Mobile USA”) entered into a commitment letter, dated as of April 29, 2018 (as amended and restated on May 15, 2018, the “Commitment Letter”), with certain financial institutions named therein that have committed to provide up to $38.0 billion in debt financing. As permitted by the terms of the Commitment Letter, on June 6, 2018, T-Mobile USA reduced the initial aggregate commitment under the Commitment Letter by $8.0 billion such that the remaining size of the commitment is currently $30.0 billion . The funding of the debt facilities provided for in the Commitment Letter is subject to the satisfaction of the conditions set forth therein, including consummation of the Merger. The proceeds of the debt financing provided for in the Commitment Letter will be used to refinance certain existing debt of us, Sprint and our and Sprint’s respective subsidiaries and for post-closing working capital needs of the combined company. In connection with the entry into the Business Combination Agreement, DT and T-Mobile USA entered into a Financing Matters Agreement, dated as of April 29, 2018, pursuant to which DT agreed, among other things, to consent to the incurrence by T-Mobile USA of secured debt in connection with and after the consummation of the Merger. In connection with receiving the requisite consents, our upfront payment to DT was $7 million during the three months ended June 30, 2018 and was recognized as a reduction to Long-term debt to affiliates in our Condensed Consolidated Balance Sheets. See Note 9 - Debt for further information. On May 18, 2018, under the terms and conditions described in the Consent Solicitation Statement dated as of May 14, 2018 (the “Consent Solicitation Statement”), we obtained consents necessary to effect certain amendments to certain existing debt of us and our subsidiaries. In connection with receiving the requisite consents, our upfront payments to third-party Note holders were approximately $31 million during the three months ended June 30, 2018 and were recognized as a reduction to Long-term debt. We paid third party bank fees associated with obtaining the requisite consents of $6 million during the three months ended June 30, 2018, which we recognized as Selling, general and administrative expenses in our Condensed Consolidated Statements of Comprehensive Income . Under the terms of Business Combination Agreement, Sprint may be required to reimburse us for 33% of the upfront consent and related bank fees we paid, or $14 million , if the Business Combination Agreement is terminated. We have not accrued the reimbursement of these fees as of June 30, 2018. On May 18, 2018, Sprint also obtained consents necessary to effect certain amendments to certain existing debt of it and its subsidiaries. In connection with receiving the requisite consents, Sprint’s upfront payments to third party Note holders and related bank fees were $241 million during the three months ended June 30, 2018. Under the terms of Business Combination Agreement, we may also be required to reimburse Sprint for 67% of the upfront consent and related bank fees it paid, or $161 million , if the Business Combination Agreement is terminated. We have not accrued these fees as of June 30, 2018. For the three months and six months ended June 30, 2018, we recognized costs associated with the proposed Sprint transaction of $41 million . These costs generally included bank fees associated with obtaining the requisite consents on debt to third parties, consulting, and legal fees and were recognized as Selling, general and administrative expenses in our Condensed Consolidated Statements of Comprehensive Income . The consummation of the transactions contemplated by the Business Combination Agreement is subject to regulatory approvals and certain other customary closing conditions. The transaction is expected to close during the first half of 2019. The Business Combination Agreement contains certain termination rights for both Sprint and us. If we terminate the Business Combination Agreement in connection with a failure to satisfy the closing condition related to specified minimum credit ratings for the combined company on the closing date of the Merger (after giving effect to the Merger) from at least two of the three credit rating agencies, then in certain circumstances, we may be required to pay Sprint an amount equal to $600 million . On June 18, 2018, we filed the Public Interest Statement and applications for approval of our merger with Sprint with the Federal Communications Commission (“FCC”). On July 18, 2018, the FCC issued a Public Notice formally accepting our applications and establishing a period for public comment. On July 30, 2018, we filed a registration statement on Form S-4 with the Securities and Exchange Commission related to the Merger, which is available at the T-Mobile Investor Relations website. The registration statement has not yet become effective. Acquisition of Layer3 TV On January 22, 2018, we completed our acquisition of television innovator Layer3 TV for cash consideration of $318 million . The consideration included a $5 million payment that was made after the closing date in the second quarter of 2018. Upon closing of the transaction, Layer3 TV became a wholly-owned consolidated subsidiary. Layer3 TV acquires and distributes digital entertainment programming primarily through the internet to residential customers, offering direct to home digital television and multi-channel video programming distribution services. This transaction represented an opportunity to acquire a complementary service to our existing wireless service to advance our video strategy. We accounted for the purchase of Layer3 TV as a business combination. Costs related to this acquisition were immaterial to our Condensed Consolidated Statements of Comprehensive Income . The grant-date fair value of cash-based and share-based incentive compensation awards attributable to post-combination services was approximately $37 million . The following table shows the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed and the resultant purchase price allocation: (in millions) January 22, Assets acquired Cash and cash equivalents $ 2 Other current assets 14 Property and equipment, net 11 Intangible assets 100 Goodwill 218 Deferred tax assets 2 Total assets acquired $ 347 Liabilities assumed Accounts payable and accrued liabilities $ 27 Short-term debt 2 Total liabilities assumed 29 Total consideration transferred $ 318 We recognized a liability of $21 million within Accounts payable and accrued liabilities in our Condensed Consolidated Balance Sheets and an associated indemnification asset of $12 million in our Condensed Consolidated Balance Sheets related to minimum commitments under acquired content agreements. The maximum amount that would be received under the indemnification agreement is $12 million . Goodwill of $218 million is calculated as the excess of the purchase price paid over the net assets acquired. The goodwill recorded as part of the Layer3 TV acquisition primarily reflects industry knowledge of the retained management team, as well as intangible assets that do not qualify for separate recognition. None of the goodwill is deductible for tax purposes. See Note 6 - Goodwill for further information. As part of the transaction, we acquired an identifiable intangible asset of developed technology with an estimated fair value of $100 million , which is being amortized on a straight-line basis over a useful life of 5 years . The financial results from the acquisition of Layer3 TV since the closing date through June 30, 2018 were not material to our Condensed Consolidated Statements of Comprehensive Income . Acquisition of Iowa Wireless On January 1, 2018 (the “acquisition date”), we closed on our previously announced Unit Purchase Agreement to acquire the remaining equity in IWS, a 54% owned unconsolidated subsidiary, for a purchase price of $25 million . We accounted for our acquisition of IWS as a business combination. Prior to the acquisition date, we accounted for our previously-held investment in IWS under the equity method as we had significant influence, but not control. Authoritative guidance on accounting for business combinations requires that an acquirer re-measure its previously held equity interest in the acquiree at its acquisition date fair value and recognize the resulting gain or loss in earnings. As such, we valued our previously held equity interest in IWS at $56 million as of the acquisition date and recognized a gain of $15 million . The following table highlights the consideration transferred, the fair value of our previously held equity interest and bargain purchase: (in millions) January 1, Consideration transferred: Cash paid $ 25 Previously held equity interest: Acquisition date fair value of previously held equity interest 56 Bargain purchase gain 25 Net assets acquired $ 106 As part of the acquisition of IWS, we recognized a bargain purchase gain of approximately $25 million , which represents the fair value of the identifiable net assets acquired, primarily IWS spectrum licenses, in excess of the purchase price and fair value of our previously held equity interest. We were in a favorable position to acquire the remaining shares of IWS as a result of our previously held 54% equity interest in IWS, an unprofitable business with valuable spectrum holdings. The following table shows the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed and the resultant purchase price allocation: (in millions) January 1, Assets acquired Current assets Cash and cash equivalents $ 3 Accounts receivable, net 6 Equipment installment plan receivables, net 3 Inventories 1 Other current assets 2 Total current assets 15 Property and equipment, net 36 Spectrum licenses 87 Total assets acquired $ 138 Liabilities assumed Accounts payable and accrued liabilities $ 6 Deferred revenue 2 Total current liabilities 8 Deferred tax liabilities 17 Other long-term liabilities 7 Total long-term liabilities 24 Net assets acquired $ 106 We included both the gain on our previously held equity interest in IWS and the bargain purchase gain within Other expense, net for the six months ended June 30, 2018 . Pro forma information The acquisitions of Layer3 TV and IWS were not material to our prior period consolidated results on a pro forma basis. |
Receivables and Allowance for C
Receivables and Allowance for Credit Losses | 6 Months Ended |
Jun. 30, 2018 | |
Receivables [Abstract] | |
Receivables and Allowance for Credit Losses | Note 4 – Receivables and Allowance for Credit Losses Our portfolio of receivables is comprised of two portfolio segments, accounts receivable and EIP receivables. Our accounts receivable segment primarily consists of amounts currently due from customers, including service and leased device receivables, other carriers and third-party retail channels. Based upon customer credit profiles, we classify the EIP receivables segment into two customer classes of “Prime” and “Subprime.” Prime customer receivables are those with lower delinquency risk and Subprime customer receivables are those with higher delinquency risk. Customers may be required to make a down payment on their equipment purchases. In addition, certain customers within the Subprime category are required to pay an advance deposit. To determine a customer’s credit profile, we use a proprietary credit scoring model that measures the credit quality of a customer at the time of application for wireless communications service using several factors, such as credit bureau information, consumer credit risk scores and service plan characteristics. The following table summarizes the EIP receivables, including imputed discounts and related allowance for credit losses: (in millions) June 30, December 31, EIP receivables, gross $ 3,914 $ 3,960 Unamortized imputed discount (268 ) (264 ) EIP receivables, net of unamortized imputed discount 3,646 3,696 Allowance for credit losses (116 ) (132 ) EIP receivables, net $ 3,530 $ 3,564 Classified on the balance sheet as: Equipment installment plan receivables, net $ 2,308 $ 2,290 Equipment installment plan receivables due after one year, net 1,222 1,274 EIP receivables, net $ 3,530 $ 3,564 To determine the appropriate level of the allowance for credit losses, we consider a number of credit quality indicators, including historical credit losses and timely payment experience as well as current collection trends such as write-off frequency and severity, aging of the receivable portfolio, credit quality of the customer base and other qualitative factors such as macro-economic conditions. We write off account balances if collection efforts are unsuccessful and the receivable balance is deemed uncollectible, based on customer credit quality and the aging of the receivable. For EIP receivables, subsequent to the initial determination of the imputed discount, we assess the need for and, if necessary, recognize an allowance for credit losses to the extent the amount of estimated probable losses on the gross EIP receivable balances exceed the remaining unamortized imputed discount balances. The EIP receivables had weighted average effective imputed interest rates of 10.1% and 9.6% as of June 30, 2018 and December 31, 2017 , respectively. Activity for the six months ended June 30, 2018 and 2017 , in the allowance for credit losses and unamortized imputed discount balances for the accounts receivable and EIP receivable segments were as follows: June 30, 2018 June 30, 2017 (in millions) Accounts Receivable Allowance EIP Receivables Allowance Total Accounts Receivable Allowance EIP Receivables Allowance Total Allowance for credit losses and imputed discount, beginning of period $ 86 $ 396 $ 482 $ 102 $ 316 $ 418 Bad debt expense 25 103 128 56 119 175 Write-offs, net of recoveries (41 ) (119 ) (160 ) (75 ) (137 ) (212 ) Change in imputed discount on short-term and long-term EIP receivables N/A 102 102 N/A 121 121 Impact on the imputed discount from sales of EIP receivables N/A (98 ) (98 ) N/A (85 ) (85 ) Allowance for credit losses and imputed discount, end of period $ 70 $ 384 $ 454 $ 83 $ 334 $ 417 Management considers the aging of receivables to be an important credit indicator. The following table provides delinquency status for the unpaid principal balance for receivables within the EIP portfolio segment, which we actively monitor as part of our current credit risk management practices and policies: June 30, 2018 December 31, 2017 (in millions) Prime Subprime Total EIP Receivables, gross Prime Subprime Total EIP Receivables, gross Current - 30 days past due $ 1,630 $ 2,204 $ 3,834 $ 1,727 $ 2,133 $ 3,860 31 - 60 days past due 12 27 39 17 29 46 61 - 90 days past due 5 14 19 6 16 22 More than 90 days past due 6 16 22 8 24 32 Total receivables, gross $ 1,653 $ 2,261 $ 3,914 $ 1,758 $ 2,202 $ 3,960 |
Sales of Certain Receivables
Sales of Certain Receivables | 6 Months Ended |
Jun. 30, 2018 | |
Transfers and Servicing [Abstract] | |
Sales of Certain Receivables | Note 5 – Sales of Certain Receivables We have entered into transactions to sell certain service and EIP accounts receivable. The transactions, including our continuing involvement with the sold receivables and the respective impacts to our condensed consolidated financial statements , are described below. Sales of Service Receivables Overview of the Transaction In 2014, we entered into an arrangement to sell certain service accounts receivable on a revolving basis and in November 2016, the arrangement was amended to increase the maximum funding commitment to $950 million (the “service receivable sale arrangement”) and extend the scheduled expiration date to March 2018. In February 2018, the service receivable sale arrangement was again amended to extend the scheduled expiration date to March 2019. In April 2018, the service receivable sale arrangement was again amended to update certain terms and covenants contained therein to make them consistent with analogous terms and covenants in documents of our other financing arrangements. As of June 30, 2018 and December 31, 2017 , the service receivable sale arrangement provided funding of $818 million and $880 million , respectively. Sales of receivables occur daily and are settled on a monthly basis. The receivables consist of service charges currently due from customers and are short-term in nature. In connection with the service receivable sale arrangement, we formed a wholly-owned subsidiary, which qualifies as a bankruptcy remote entity, to sell service accounts receivable (the “Service BRE”). The Service BRE does not qualify as a VIE, and due to the significant level of control we exercise over the entity, it is consolidated. Pursuant to the arrangement, certain of our wholly-owned subsidiaries transfer selected receivables to the Service BRE. The Service BRE then sells the receivables to an unaffiliated entity (the “Service VIE”), which was established to facilitate the sale of beneficial ownership interests in the receivables to certain third parties. Variable Interest Entity We determined that the Service VIE qualifies as a VIE as it lacks sufficient equity to finance its activities. We have a variable interest in the Service VIE, but are not the primary beneficiary as we lack the power to direct the activities that most significantly impact the Service VIE’s economic performance. Those activities include committing the Service VIE to legal agreements to purchase or sell assets, selecting which receivables are purchased in the service receivable sale arrangement, determining whether the Service VIE will sell interests in the purchased service receivables to other parties, funding of the entity and servicing of receivables. We do not hold the power to direct the key decisions underlying these activities. For example, while we act as the servicer of the sold receivables, which is considered a significant activity of the Service VIE, we are acting as an agent in our capacity as the servicer and the counterparty to the service receivable sale arrangement has the ability to remove us as the servicing agent of the receivables at will with no recourse available to us. As we have determined we are not the primary beneficiary, the balances and results of the Service VIE are not included in our condensed consolidated financial statements . The following table summarizes the carrying amounts and classification of assets, which consists primarily of the deferred purchase price and liabilities included in our Condensed Consolidated Balance Sheets that relate to our variable interest in the Service VIE: (in millions) June 30, December 31, Other current assets $ 287 $ 236 Accounts payable and accrued liabilities 10 25 Other current liabilities 159 180 Sales of EIP Receivables Overview of the Transaction In 2015, we entered into an arrangement to sell certain EIP accounts receivable on a revolving basis and in August 2017, the EIP sale arrangement was amended to reduce the maximum funding commitment to $1.2 billion (the “EIP sale arrangement”) and extend the scheduled expiration date to November 2018. In December 2017, the EIP sale arrangement was again amended to increase the maximum funding commitment to $1.3 billion . In April 2018, the EIP sale arrangement was again amended to update certain terms and covenants contained therein to make them consistent with analogous terms and covenants in the documentation of our other financing arrangements. As of both June 30, 2018 and December 31, 2017 , the EIP sale arrangement provided funding of $1.3 billion . Sales of EIP receivables occur daily and are settled on a monthly basis. The receivables consist of customer EIP balances, which require monthly customer payments for up to 24 months. In connection with this EIP sale arrangement, we formed a wholly-owned subsidiary, which qualifies as a bankruptcy remote entity (the “EIP BRE”). Pursuant to the EIP sale arrangement, our wholly-owned subsidiary transfers selected receivables to the EIP BRE. The EIP BRE then sells the receivables to a non-consolidated and unaffiliated third-party entity for which we do not exercise any level of control, nor does the third-party entity qualify as a VIE. Variable Interest Entity We determined that the EIP BRE is a VIE as its equity investment at risk lacks the obligation to absorb a certain portion of its expected losses. We have a variable interest in the EIP BRE and determined that we are the primary beneficiary based on our ability to direct the activities which most significantly impact the EIP BRE’s economic performance. Those activities include selecting which receivables are transferred into the EIP BRE and sold in the EIP sale arrangement and funding of the EIP BRE. Additionally, our equity interest in the EIP BRE obligates us to absorb losses and gives us the right to receive benefits from the EIP BRE that could potentially be significant to the EIP BRE. Accordingly, we determined that we are the primary beneficiary, and include the balances and results of operations of the EIP BRE in our condensed consolidated financial statements . The following table summarizes the carrying amounts and classification of assets, which consists primarily of the deferred purchase price and liabilities included in our Condensed Consolidated Balance Sheets that relate to the EIP BRE: (in millions) June 30, December 31, Other current assets $ 394 $ 403 Other assets 99 109 Other long-term liabilities 20 3 In addition, the EIP BRE is a separate legal entity with its own separate creditors who will be entitled, prior to any liquidation of the EIP BRE, to be satisfied prior to any value in the EIP BRE becoming available to us. Accordingly, the assets of the EIP BRE may not be used to settle our general obligations and creditors of the EIP BRE have limited recourse to our general credit. Sales of Receivables The transfers of service receivables and EIP receivables to the non-consolidated entities are accounted for as sales of financial assets. Once identified for sale, the receivable is recorded at the lower of cost or fair value. Upon sale, we derecognize the net carrying amount of the receivables. We recognize the cash proceeds received upon sale in Net cash provided by operating activities in our Condensed Consolidated Statements of Cash Flows . We recognize proceeds net of the deferred purchase price, consisting of a receivable from the purchasers that entitles us to certain collections on the receivables. We recognize the collection of the deferred purchase price in Net cash provided by investing activities in our Condensed Consolidated Statements of Cash Flows as Proceeds related to beneficial interests in securitization transactions. The deferred purchase price represents a financial asset that is primarily tied to the creditworthiness of the customers and which can be settled in such a way that we may not recover substantially all of our recorded investment, due to default by the customers on the underlying receivables. We elected, at inception, to measure the deferred purchase price at fair value with changes in fair value included in Selling, general and administrative expense in our Condensed Consolidated Statements of Comprehensive Income . The fair value of the deferred purchase price is determined based on a discounted cash flow model which uses primarily unobservable inputs (Level 3 inputs), including customer default rates. As of June 30, 2018 and December 31, 2017 , our deferred purchase price related to the sales of service receivables and EIP receivables was $778 million and $745 million , respectively. The following table summarizes the impacts of the sale of certain service receivables and EIP receivables in our Condensed Consolidated Balance Sheets : (in millions) June 30, December 31, Derecognized net service receivables and EIP receivables $ 2,679 $ 2,725 Other current assets 681 639 of which, deferred purchase price 679 636 Other long-term assets 99 109 of which, deferred purchase price 99 109 Accounts payable and accrued liabilities 10 25 Other current liabilities 159 180 Other long-term liabilities 20 3 Net cash proceeds since inception 1,933 2,058 Of which: Change in net cash proceeds during the year-to-date period (125 ) 28 Net cash proceeds funded by reinvested collections 2,058 2,030 We recognized losses from sales of receivables of $28 million and $80 million for the three months ended June 30, 2018 and 2017 , respectively, and $80 million and $175 million for the six months ended June 30, 2018 and 2017 , respectively. These losses from sales of receivables were recognized in Selling, general and administrative expense in our Condensed Consolidated Statements of Comprehensive Income . Losses from sales of receivables include adjustments to the receivables’ fair values and changes in fair value of the deferred purchase price. Continuing Involvement Pursuant to the sale arrangements described above, we have continuing involvement with the service receivables and EIP receivables we sell as we service the receivables and are required to repurchase certain receivables, including ineligible receivables, aged receivables and receivables where write-off is imminent. We continue to service the customers and their related receivables, including facilitating customer payment collection, in exchange for a monthly servicing fee. As the receivables are sold on a revolving basis, the customer payment collections on sold receivables may be reinvested in new receivable sales. While servicing the receivables, we apply the same policies and procedures to the sold receivables as we apply to our owned receivables, and we continue to maintain normal relationships with our customers. Pursuant to the EIP sale arrangement, under certain circumstances, we are required to deposit cash or replacement EIP receivables primarily for contracts terminated by customers under our JUMP! Program. In addition, we have continuing involvement with the sold receivables as we may be responsible for absorbing additional credit losses pursuant to the sale arrangements. Our maximum exposure to loss related to the involvement with the service receivables and EIP receivables sold under the sale arrangements was $1.3 billion as of June 30, 2018 . The maximum exposure to loss, which is a required disclosure under GAAP, represents an estimated loss that would be incurred under severe, hypothetical circumstances whereby we would not receive the deferred purchase price portion of the contractual proceeds withheld by the purchasers and would also be required to repurchase the maximum amount of receivables pursuant to the sale arrangements without consideration for any recovery. As we believe the probability of these circumstances occurring is remote, the maximum exposure to loss is not an indication of our expected loss. |
Goodwill
Goodwill | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Note 6 - Goodwill The changes in the carrying amount of goodwill for the six months ended June 30, 2018 , are as follows: (in millions) Goodwill Historical goodwill $ 12,449 Accumulated impairment losses at December 31, 2017 (10,766 ) Balance as of December 31, 2017 1,683 Goodwill from acquisition of Layer3 TV 218 Balance as of June 30, 2018 $ 1,901 Accumulated impairment losses at June 30, 2018 $ (10,766 ) On January 22, 2018, we completed our acquisition of television innovator Layer3 TV. This purchase was accounted for as a business combination resulting in $218 million in goodwill. Layer3 TV is a separate reporting unit and the acquired goodwill will be tested for impairment at this level. See Note 3 - Business Combinations for additional information. |
Spectrum License Transactions
Spectrum License Transactions | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Spectrum License Transactions | Note 7 – Spectrum License Transactions The following table summarizes our spectrum license activity for the six months ended June 30, 2018 : (in millions) Spectrum Licenses Balance at December 31, 2017 $ 35,366 Spectrum license acquisitions 136 Costs to clear spectrum 30 Balance at June 30, 2018 $ 35,532 We had the following spectrum license transactions in the six months ended June 30, 2018 : • We recorded spectrum licenses received as part of our acquisition of the remaining equity interest in IWS at their estimated fair value of approximately $87 million . See Note 3 - Business Combinations for further information. • We closed on multiple spectrum purchase agreements in which we acquired total spectrum licenses of approximately $49 million for cash consideration. No gains or losses were recognized on the spectrum license purchases . |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 8 – Fair Value Measurements The carrying values of cash and cash equivalents, accounts receivable, accounts receivable from affiliates, accounts payable, and borrowings under our senior secured revolving credit facility with DT, our majority stockholder, approximate fair value due to the short-term maturities of these instruments. Deferred Purchase Price Assets In connection with the sales of certain service and EIP receivables pursuant to the sale arrangements, we have deferred purchase price assets measured at fair value that are based on a discounted cash flow model using unobservable Level 3 inputs, including customer default rates. See Note 5 – Sales of Certain Receivables for further information . The carrying amounts and fair values of our assets measured at fair value on a recurring basis included in our Condensed Consolidated Balance Sheets were as follows: Level within the Fair Value Hierarchy June 30, 2018 December 31, 2017 (in millions) Carrying Amount Fair Value Carrying Amount Fair Value Assets: Deferred purchase price assets 3 $ 778 $ 778 $ 745 $ 745 Long-term Debt The fair value of our Senior Notes to third parties was determined based on quoted market prices in active markets, and therefore was classified as Level 1 within the fair value hierarchy. The fair values of our Senior Notes to affiliates , Incremental Term Loan Facility to affiliates , and Senior Reset Notes to affiliates were determined based on a discounted cash flow approach using market interest rates of instruments with similar terms and maturities and an estimate for our standalone credit risk. Accordingly, our Senior Notes to affiliates , Incremental Term Loan Facility to affiliates , and Senior Reset Notes to affiliates were classified as Level 2 within the fair value hierarchy. Although we have determined the estimated fair values using available market information and commonly accepted valuation methodologies, considerable judgment was required in interpreting market data to develop fair value estimates for the Senior Notes to affiliates , Incremental Term Loan Facility to affiliates , and Senior Reset Notes to affiliates . The fair value estimates were based on information available as of June 30, 2018 and December 31, 2017 . As such, our estimates are not necessarily indicative of the amount we could realize in a current market exchange. The carrying amounts and fair values of our short-term and long-term debt included in our Condensed Consolidated Balance Sheets were as follows: Level within the Fair Value Hierarchy June 30, 2018 December 31, 2017 (in millions) Carrying Amount Fair Value Carrying Amount Fair Value Liabilities: Senior Notes to third parties 1 $ 10,947 $ 11,159 $ 11,910 $ 12,540 Senior Notes to affiliates 2 9,983 10,015 7,486 7,852 Incremental Term Loan Facility to affiliates 2 4,000 3,973 4,000 4,020 Senior Reset Notes to affiliates 2 598 658 3,100 3,260 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt | Note 9 – Debt Activity for the six months ended June 30, 2018 , related to our debt was as follows: (in millions) December 31, Proceeds from Issuances and Borrowings (1)(3) Note Redemptions (1)(3) Repayments Reclassifications (1) Consent Fees Other (2) June 30, Short-term debt $ 1,612 $ — $ (3,424 ) $ — $ 2,425 $ — $ 391 $ 1,004 Long-term debt 12,121 2,494 — — (2,425 ) (31 ) (94 ) 12,065 Total debt to third parties 13,733 2,494 (3,424 ) — — (31 ) 297 13,069 Short-term debt to affiliates — 4,240 — (3,920 ) — — — 320 Long-term debt to affiliates 14,586 — — — — (7 ) 2 14,581 Total debt to affiliates 14,586 4,240 — (3,920 ) — (7 ) 2 14,901 Total debt $ 28,319 $ 6,734 $ (3,424 ) $ (3,920 ) $ — $ (38 ) $ 299 $ 27,970 (1) Issuances and borrowings, note redemptions, and reclassifications are recorded net of related issuance costs, discounts, and premiums. Issuances and borrowings and repayments for Short-term debt to affiliates represent net outstanding borrowings and net repayments on our revolving credit facility. (2) Other includes: $300 million of issuances of short-term debt related to vendor financing arrangements, of which $291 million related to financing of property and equipment. During the six months ended June 30, 2018 , we did not have any repayments under the vendor financing arrangements. Vendor financing arrangements are included in Short-term debt within Total current liabilities in our Condensed Consolidated Balance Sheets. Other also includes capital leases and the amortization of issuance costs, discounts, premiums, and consent fees. Capital lease liabilities totaled $1.8 billion at both June 30, 2018 and December 31, 2017 . (3) Through net settlement on April 30, 2018, we issued to DT a total of $2.5 billion in aggregate principal amount of New DT Notes (as defined below) and redeemed $1.25 billion in aggregate principal amount of 8.097% Senior Reset Notes due 2021 and $1.25 billion in aggregate principal amount of 8.195% Senior Reset Notes due 2022 (collectively, the “DT Senior Reset Notes”) held by DT. Debt to Third Parties During the six months ended June 30, 2018 , we issued the following Senior Notes: (in millions) Principal Issuances Issuance Costs Net Proceeds from Issuance of Long-Term Debt Issue Date 4.500% Senior Notes due 2026 $ 1,000 $ 2 $ 998 January 25, 2018 4.750% Senior Notes due 2028 1,500 4 1,496 January 25, 2018 Total of Senior Notes issued $ 2,500 $ 6 $ 2,494 We used the net proceeds of $2.494 billion from the public debt issuance in January 2018 to redeem our $1.750 billion of 6.625% Senior Notes due 2023 on April 1, 2018, and to redeem our $600 million of 6.836% Senior Notes due 2023 on April 28, 2018, as further discussed below, and for general corporate purposes, including the partial repayment of borrowings under our revolving credit facility with DT. During the six months ended June 30, 2018 , we made the following note redemptions: (in millions) Principal Amount Write-off of Premiums, Discounts and Issuance Costs (1) Call Penalties (1) (2) Redemption Redemption Price 6.125% Senior Notes due 2022 $ 1,000 $ 1 $ 31 January 15, 2018 103.063 % 6.625% Senior Notes due 2023 1,750 (75 ) 58 April 1, 2018 103.313 % 6.836% Senior Notes due 2023 600 — 21 April 28, 2018 103.418 % (1) Write-off of premiums, discounts, issuance costs and call penalties are included in Other expense, net in our Condensed Consolidated Statements of Comprehensive Income . Write-off of premiums, discounts and issuance costs are included in Losses on redemption of debt within Net cash provided by operating activities in our Condensed Consolidated Statements of Cash Flows . (2) The call penalty is the excess paid over the principal amount. Call penalties are included within Net cash used in financing activities in our Condensed Consolidated Statements of Cash Flows . Debt to Affiliates On April 30, 2018, DT purchased (i) $1.0 billion in aggregate principal amount of 4.500% Senior Notes due 2026 and (ii) $1.5 billion in aggregate principal amount of 4.750% Senior Notes due 2028 directly from T-Mobile USA and certain of its affiliates, as guarantors, with no underwriting discount (the “New DT Notes”). We used the net proceeds of $2.5 billion from the transaction to refinance existing indebtedness to DT as follows: (in millions) Principal Amount Write -off of Embedded Derivatives (1) Other (2) Redemption Redemption Price 8.097% Senior Reset Notes due 2021 $ 1,250 $ (8 ) $ 51 April 28, 2018 104.0485 % 8.195% Senior Reset Notes due 2022 1,250 (8 ) 51 April 28, 2018 104.0975 % (1) Certain components of the reset features were required to be bifurcated from the DT Senior Reset Notes and separately accounted for as embedded derivative instruments. Write-off of embedded derivatives are included in Losses on redemption of debt within Net cash provided by operating activities in our Condensed Consolidated Statements of Cash Flows . (2) Cash for the premium portion of the redemption price set forth in the indenture governing the DT Senior Reset Notes, plus accrued but unpaid interest on the DT Senior Reset Notes to, but not including, the exchange date. Incremental Term Loan Facility In March 2018, we amended the terms of the Incremental Term Loan Facility. Following this amendment, the applicable margin payable on LIBOR indexed loans is 1.50% under the $2.0 billion Incremental Term Loan Facility maturing on November 9, 2022 and 1.75% under the $2.0 billion Incremental Term Loan Facility maturing on January 31, 2024. The amendment also modified the Incremental Term Loan Facility to (i) include a soft-call prepayment premium of 1.00% of the outstanding principal amount of the loans under the Incremental Term Loan Facility payable to DT upon certain refinancing of such loans by us with lower priced debt prior to a date that is six months after March 29, 2018 and (ii) update certain covenants and other provisions to make them substantially consistent, subject to certain additional carve outs, with our most recently publicly issued notes. No issuance fees were incurred related to this debt agreement for the three and six months ended June 30, 2018 . Revolving Credit Facility In January 2018, we utilized proceeds under our revolving credit facility with DT to redeem $1.0 billion in aggregate principal amount of our 6.125% Senior Notes due 2022 and for general corporate purposes. On January 29, 2018, the proceeds utilized under our revolving credit facility with DT were repaid. The proceeds and borrowings from the revolving credit facility are presented in Proceeds from borrowing on revolving credit facility and Repayments of revolving credit facility within Net cash used in financing activities in our Condensed Consolidated Statements of Cash Flows . As of June 30, 2018 , there was $320 million in outstanding borrowings under the revolving credit facility. As of December 31, 2017 , there were no outstanding borrowings under the revolving credit facility. In March 2018, we amended the terms of (a) our Secured Revolving Credit Facility and (b) our Unsecured Revolving Credit Facility. Following these amendments, (i) the range of applicable margin payable under the Secured Revolving Credit Facility is 1.05% to 1.80% , (ii) the range of the applicable margin payable under the Unsecured Revolving Credit Facility is 2.05% to 3.05% , (iii) the range of the undrawn commitment fee applicable to the Secured Revolving Credit Facility is 0.25% to 0.45% , (iv) the range of the undrawn commitment fee applicable to the Unsecured Revolving Credit Facility is 0.20% to 0.575% and (v) the maturity date of the revolving credit facility with DT is December 29, 2020. The amendments also modify the facility to update certain covenants and other provisions to make them substantially consistent, subject to certain additional carve outs, with our most recently publicly issued notes. Commitment Letter In connection with the entry into the Business Combination Agreement, T-Mobile USA entered into a commitment letter, dated as of April 29, 2018 (as amended and restated on May 15, 2018, the “Commitment Letter”), with certain financial institutions named therein that have committed to provide up to $38.0 billion in secured and unsecured debt financing, including a $4.0 billion secured revolving credit facility, a $7.0 billion secured term loan facility, a $19.0 billion secured bridge loan facility and an $8.0 billion unsecured bridge loan facility. Following the receipt of the debt consents described below, as permitted by the terms of the commitment letter, on May 22, 2018, T-Mobile USA reallocated the entire $8.0 billion unsecured bridge loan facility to be part of the secured bridge loan facility, increasing the size of the secured bridge loan facility to $27.0 billion , and subsequently on June 6, 2018, reduced the commitments under the secured bridge facility by $8.0 billion , such that the remaining size of the secured bridge facility is currently $19.0 billion and total committed financing is currently $30.0 billion . The funding of the debt facilities provided for in the Commitment Letter is subject to the satisfaction of the conditions set forth therein, including consummation of the proposed Merger. The proceeds of the debt financing provided for in the Commitment Letter will be used to refinance certain existing debt of us, Sprint and our and Sprint’s respective subsidiaries and for post-closing working capital needs of the combined company. Financing Matters Agreement In connection with the entry into the Business Combination Agreement, DT and T-Mobile USA entered into a Financing Matters Agreement, dated as of April 29, 2018 (the “Financing Matters Agreement”). Pursuant to the Financing Matters Agreement, DT agreed, among other things, to consent to the incurrence by T-Mobile USA of secured debt in connection with and after the consummation of the Merger, and to provide a lock up on sales thereby as to certain senior notes of T-Mobile USA held thereby. In addition, T-Mobile USA agreed, among other things, to repay and terminate, upon closing of the Merger, the Incremental Term Loan Facility and the revolving credit facility of T-Mobile USA which are provided by DT, as well as $2.0 billion of T-Mobile USA’s 5.300% senior notes due 2021 and $2.0 billion of T-Mobile USA’s 6.000% senior notes due 2024. In addition, T-Mobile USA and DT agreed, upon closing of the Merger, to amend the $1.25 billion of T-Mobile USA’s 5.125% senior notes due 2025 and $1.25 billion of T-Mobile USA’s 5.375% senior notes due 2027 to change the maturity dates thereof to April 15, 2021 and April 15, 2022, respectively. In connection with receiving the requisite consents, our upfront payment to DT was $7 million during the three months ended June 30, 2018 and was recognized as a reduction to Long-term debt to affiliates in our Condensed Consolidated Balance Sheets. If the Business Combination is consummated, we will make additional payments for requisite consents to DT of $20 million . We have not accrued these additional payments as of June 30, 2018. Consents on Debt to Third-Parties On May 18, 2018, under the terms and conditions described in the Consent Solicitation Statement, we obtained consents necessary to effect certain amendments to our Senior Notes to third parties in connection with the Business Combination Agreement. Pursuant to the Consent Solicitation Statement, third party Notes holders agreed, among other things, to consent to increasing the amount of Secured Indebtedness under Credit Facilities that can be incurred from the greater of $9 billion and 150% of Consolidated Cash Flow to the greater of $9 billion and an amount that would not cause the Secured Debt to Cash Flow Ratio (calculated net of cash and cash equivalents) to exceed 2.00x (the “Ratio Secured Debt Proposed Amendments”) and in each case as such capitalized term is defined in the Indenture. In connection with receiving the requisite consents for the Ratio Secured Debt Proposed Amendments, our upfront payments to third party Note holders were $17 million during the three months ended June 30, 2018, and were recognized as a reduction to Long-term debt in our Condensed Consolidated Balance Sheets. These upfront payments increased the effective interest rate of the related debt. In addition, Note holders agreed, among other things, to allow certain entities related to Sprint’s existing spectrum securitization notes program (“Existing Sprint Spectrum Program”) to be non-guarantor Restricted Subsidiaries, provided that the principal amount of the spectrum notes issued and outstanding under the Existing Sprint Spectrum Program does not exceed $7.0 billion and that the principal amount of such spectrum notes reduces the amount available under the Credit Facilities ratio basket, and to revise the definition of GAAP to mean generally accepted accounting principles in effect from time to time, unless the Company elects to “freeze” GAAP as of any date, and to exclude the effect of the changes in the accounting treatment of lease obligations (the “Existing Sprint Spectrum and GAAP Proposed Amendments,” and together with the Ratio Secured Debt Proposed Amendments, the “Proposed Amendments”). In connection with receiving the requisite consents for the Existing Sprint Spectrum and GAAP Proposed Amendments, our upfront payments to third party Note holders were $14 million during the three months ended June 30, 2018, and were recognized as a reduction to Long-term debt in our Condensed Consolidated Balance Sheets. These upfront payments increased the effective interest rate of the related debt. In connection with obtaining the requisite consents, on May 20, 2018, T-Mobile USA, the guarantors and Deutsche Bank Trust Company Americas, as trustee, executed and delivered the 37 th supplemental indenture to the Indenture, pursuant to which, with respect to each of the Notes, the Proposed Amendments will become effective immediately prior to the consummation of the Business Combination with Sprint. We paid third party bank fees associated with obtaining the requisite consents related to the Proposed Amendments of $6 million during the three months ended June 30, 2018, which we recognized as Selling, general and administrative expenses in our Condensed Consolidated Statements of Comprehensive Income . If the Business Combination is consummated, we will make additional payments to third party Note holders for requisite consents related to the Ratio Secured Debt Proposed Amendments of up to $54 million and additional payments to third party Note holders for requisite consents related to the Existing Sprint Spectrum and GAAP Proposed Amendments of up to $41 million . We have not accrued these payments as of June 30, 2018. |
Employee Compensation and Benef
Employee Compensation and Benefit Plans | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Employee Compensation and Benefit Plans | Note 10 - Employee Compensation and Benefit Plans On June 13, 2018, our stockholders approved an amendment to the 2013 Omnibus Incentive Plan (as amended, the “Plan”) which increased the number of shares authorized for issuance under the Plan by 18,500,000 shares, and on June 18, 2018, we filed a Form S-8 to register a total of 19,345,005 shares of common stock pursuant to the Plan, representing those covered by the amendment and certain other predecessor plans. During the six months ended June 30, 2018, we granted or assumed an aggregate of 5,766,642 restricted stock units (“RSUs”) and restricted stock awards (“RSAs”) to eligible employees, certain non-employee directors, and eligible key executives, which primarily included annual awards. During the six months ended June 30, 2018, we granted an aggregate of 3,168,197 performance-based restricted stock units (“PRSUs”) to eligible key executives, which primarily included annual awards. In addition, in connection with the entry into a Business Combination Agreement to merge with Sprint, in April 2018 we granted an aggregate of 1,210,710 PRSUs to certain executive officers. As discussed in Note 3 - Business Combinations , in January 2018, we completed our acquisition of Layer3 TV. The grant-date fair value of share-based incentive compensation awards attributable to post-combination services was approximately $30 million . Stock-based compensation expense and related income tax benefits were as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions, except shares, per share and contractual life amounts) 2018 2017 2018 2017 Stock-based compensation expense $ 112 $ 72 $ 209 $ 139 Income tax benefit related to stock-based compensation $ 22 $ 16 $ 42 $ 32 Weighted average fair value per stock award granted $ 72.32 $ 63.94 $ 61.86 $ 63.24 Unrecognized compensation expense $ 712 $ 478 $ 712 $ 478 Weighted average period to be recognized (years) 2.1 1.9 2.1 1.9 Fair value of stock awards vested $ 30 $ 12 $ 267 $ 295 Restricted Stock Units and Restricted Stock Awards (in millions, except shares, per share and contractual life amounts) Number of Units or Awards Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Nonvested, December 31, 2017 12,061,608 $ 50.69 1.1 $ 766 Granted 5,766,642 59.91 Vested 3,448,666 45.03 Forfeited 450,845 56.39 Nonvested, June 30, 2018 13,928,739 55.94 1.2 832 Performance-Based Restricted Stock Units (in millions, except shares, per share and contractual life amounts) Number of Units Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Nonvested, December 31, 2017 1,633,935 $ 48.06 1.1 $ 104 Granted 3,168,197 65.97 Vested 1,006,769 36.47 Forfeited 11,580 66.32 Nonvested, June 30, 2018 3,783,783 62.62 1.9 226 PRSUs included in the table above are shown at target. Share payout can range from 0 to 200% based on different performance outcomes. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Note 11 - Revenue from Contracts with Customers Disaggregation of Revenue We provide wireless communication services to three primary categories of customers: • Branded postpaid customers generally include customers that are qualified to pay after receiving wireless communication services utilizing phones, mobile broadband devices (including tablets), DIGITS, SyncUP DRIVE TM or other devices including wearables; • Branded prepaid customers generally include customers who pay for wireless communication services in advance. Our branded prepaid customers include customers of T-Mobile and MetroPCS; and • Wholesale customers include Machine-to-Machine (“M2M”) and Mobile Virtual Network Operator (“MVNO”) customers that operate on our network, but are managed by wholesale partners. Branded postpaid service revenues, including branded postpaid phone revenues and branded postpaid other revenues, were as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions) 2018 2017 2018 2017 Branded postpaid service revenues Branded postpaid phone revenues $ 4,892 $ 4,565 $ 9,703 $ 9,065 Branded postpaid other revenues 272 255 531 480 Total branded postpaid service revenues $ 5,164 $ 4,820 $ 10,234 $ 9,545 We operate as a single operating segment. The balances presented within each revenue line item in our Condensed Consolidated Statements of Comprehensive Income represent categories of revenue from contracts with customers disaggregated by type of product and service. Service revenues also include revenues earned for providing value added services to customers, such as handset insurance services. Revenue generated from the lease of mobile communication devices and accessories is included within Equipment revenues in our Condensed Consolidated Statements of Comprehensive Income . Equipment revenues from the lease of mobile communication devices and accessories were as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions) 2018 2017 2018 2017 Equipment revenues from the lease of mobile communication devices and accessories $ 177 $ 234 $ 348 $ 558 Contract Balances The opening and closing balances of our contract asset and contract liability balances from contracts with customers as of January 1, 2018 and June 30, 2018 , were as follows: (in millions) Contract Assets Included in Other Current Assets Contract Liabilities Included in Deferred Revenue Balance as of January 1, 2018 $ 140 $ 718 Balance as of June 30, 2018 69 677 Change $ (71 ) $ (41 ) Contract assets primarily represent revenue recognized for equipment sales with promotional bill credits offered to customers that are paid over time and are contingent on the customer maintaining a service contract. The change in the contract asset balance includes customer activity related to new promotions, offset by billings on existing contracts and impairment which is recognized as bad debt expense. Contract liabilities are recorded when fees are collected or we have an unconditional right to consideration (a receivable) in advance of delivery of goods or services. The change in contract liabilities is primarily related to customer activity associated with our prepaid plans including the receipt of cash payments and the satisfaction of our performance obligations. Revenues for the three and six months ended June 30, 2018 , include the following: (in millions) Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Amounts included in the January 1, 2018 contract liability balance $ 31 $ 559 Amounts associated with performance obligations satisfied in previous periods 11 11 Remaining Performance Obligations As of June 30, 2018 , the aggregate amount of transaction price allocated to remaining service performance obligations for branded postpaid contracts is $525 million . We expect to recognize this revenue as service is provided over the next 24 months . Certain of our wholesale, roaming and other service contracts include variable consideration based on usage. This variable consideration has been excluded from the disclosure of remaining performance obligations. As of June 30, 2018 , the aggregate amount of the contractual minimum consideration allocated to remaining service performance obligations for wholesale, roaming and other service contracts is $513 million , $983 million and $783 million for 2018 , 2019 and 2020 and beyond, respectively. These contracts have a remaining duration of less than one year to seven years . Information about remaining performance obligations that are part of a contract that has an original expected duration of one year or less have been excluded from the above, which primarily consists of monthly service contracts. The aggregate amount of the transaction price allocated to remaining service performance obligations includes the estimated amount to be invoiced to the customer. Contract Costs The total deferred incremental costs to obtain contracts balance as of June 30, 2018 was $410 million . Deferred contract costs incurred to obtain postpaid service contracts have an average amortization period of approximately 24 months . The amortization period is monitored every period to reflect any significant change in assumptions. Amortization of deferred contract costs was $57 million and $92 million for the three and six months ended June 30, 2018 , respectively. The deferred contract cost asset is assessed for impairment on a periodic basis. There were no impairment losses recognized on deferred contract cost assets for the three and six months ended June 30, 2018 . |
Repurchases of Common Stock
Repurchases of Common Stock | 6 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Repurchases of Common Stock | Note 12 – Repurchases of Common Stock 2017 Stock Repurchase Program On December 6, 2017, our Board of Directors authorized a stock repurchase program for up to $1.5 billion of our common stock through December 31, 2018 (the “2017 Stock Repurchase Program”). During the three and six months ended June 30, 2018 , we repurchased an additional 6.2 million and 16.7 million shares of our common stock, respectively, for $388 million and $1.1 billion , respectively. From the inception of the 2017 Stock Repurchase Program through April 27, 2018, we repurchased 23.7 million shares of our common stock at an average price per share of $63.07 for a total purchase price of $1.5 billion . Repurchased shares are retired. The 2017 Stock Repurchase Program completed on April 29, 2018. 2018 Stock Repurchase Program On April 27, 2018, our Board of Directors authorized an increase in the total stock repurchase program to $9.0 billion , consisting of the $1.5 billion in repurchases previously completed and for up to an additional $7.5 billion of repurchases of our common stock, allocated as up to $500 million of shares of common stock through December 31, 2018, up to $3.0 billion of shares of common stock for the year ending December 31, 2019 and up to $4.0 billion of shares of common stock for the year ending December 31, 2020, with any authorized but unutilized repurchase capacity for any of the foregoing periods increasing the authorized repurchase capacity for the succeeding period by the amount of such unutilized repurchase capacity. The additional $7.5 billion repurchase authorization is contingent upon the termination of the Business Combination Agreement and the abandonment of the transactions contemplated under the Business Combination Agreement. Under the repurchase program, repurchases can be made from time to time using a variety of methods, which may include open market purchases, privately negotiated transactions or otherwise, all in accordance with the rules of the SEC and other applicable legal requirements. The specific timing, price and size of purchases will depend on prevailing stock prices, general economic and market conditions, and other considerations. The repurchase program does not obligate us to acquire any particular amount of common stock, and the repurchase program may be suspended or discontinued at any time at our discretion. Repurchased shares are retired. Stock Purchases by Affiliate In the first quarter of 2018, DT, our majority stockholder and an affiliated purchaser, purchased 3.3 million additional shares of our common stock at an aggregate market value of $200 million in the public market or from other parties, in accordance with the rules of the SEC and other applicable legal requirements. There were no purchases in the second quarter of 2018. We did not receive proceeds from these purchases. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 13 – Earnings Per Share The computation of basic and diluted earnings per share was as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions, except shares and per share amounts) 2018 2017 2018 2017 Net income $ 782 $ 581 $ 1,453 $ 1,279 Less: Dividends on mandatory convertible preferred stock — (14 ) — (28 ) Net income attributable to common stockholders - basic 782 567 1,453 1,251 Add: Dividends related to mandatory convertible preferred stock — 14 — 28 Net income attributable to common stockholders - diluted $ 782 $ 581 $ 1,453 $ 1,279 Weighted average shares outstanding - basic 847,660,488 830,971,528 851,420,686 829,356,255 Effect of dilutive securities: Outstanding stock options and unvested stock awards 4,380,182 7,247,653 7,308,146 9,260,131 Mandatory convertible preferred stock — 32,238,000 — 32,238,000 Weighted average shares outstanding - diluted 852,040,670 870,457,181 858,728,832 870,854,386 Earnings per share - basic $ 0.92 $ 0.68 $ 1.71 $ 1.51 Earnings per share - diluted $ 0.92 $ 0.67 $ 1.69 $ 1.47 Potentially dilutive securities: Outstanding stock options and unvested stock awards 797,948 48,397 487,133 71,734 As of June 30, 2018 , we had authorized 100 million shares of 5.50% mandatory convertible preferred stock series A, with a par value of $0.00001 per share. There were zero and 20 million preferred shares outstanding as of June 30, 2018 and June 30, 2017 , respectively. On December 15, 2017, 20 million shares of our preferred stock converted to approximately 32 million shares of our common stock at a conversion rate of 1.6119 shares of common stock for each share of previously outstanding preferred stock and certain cash-in-lieu of fractional shares. Potentially dilutive securities were not included in the computation of diluted earnings per share if to do so would have been anti-dilutive. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 14 – Commitments and Contingencies Commitments Operating Leases We have non-cancellable operating leases for cell sites, switch sites, retail stores and office facilities with contractual terms expiring through 2028 . The majority of cell site leases have an initial non-cancelable term of five to ten years with several renewal options. In addition, we have operating leases for dedicated transportation lines with varying expiration terms through 2024 . Our commitments under these leases are approximately $2.5 billion for the year ended June 30, 2019 , $4.3 billion in total for the years ended June 30, 2020 and 2021 , $2.8 billion in total for the years ended June 30, 2022 and 2023 and $2.8 billion in total for years thereafter. In February 2018, we extended the leases related to our corporate headquarters facility. These agreements increased our minimum lease payments by approximately $400 million in the aggregate. In February 2018, we amended an agreement related to the lease of certain wireless communication tower sites. This agreement increased our minimum lease payments by approximately $385 million in the aggregate. Purchase Commitments We have commitments for non-dedicated transportation lines with varying expiration terms through 2029 . In addition, we have commitments to purchase spectrum licenses, wireless devices, network services, equipment, software, marketing sponsorship agreements and other items in the ordinary course of business, with various terms through 2028 . These amounts are not reflective of our entire anticipated purchases under the related agreements, but are determined based on the non-cancelable quantities or termination amounts to which we are contractually obligated. We have contractual obligations to purchase certain goods and services from various other parties. Our purchase obligations are approximately $2.2 billion for the year ended June 30, 2019 , $2.5 billion in total for the years ended June 30, 2020 and 2021 , $1.6 billion in total for the years ended June 30, 2022 and 2023 and $1.1 billion in total for the years thereafter. In June 2018, we entered into an agreement for the purchase of network equipment totaling approximately $3.5 billion . Based on unavoidable spend, the minimum commitment under this agreement is $175 million as of June 30, 2018. Renewable Energy Purchase Agreements In June 2018, T-Mobile USA entered into a renewable energy purchase agreement (the “REPA”) with a third party. The REPA is based on the expected operation of a wind energy-generating facility located in Illinois and will remain in effect until the fifteenth anniversary of the facility’s entry into commercial operation. Commercial operation of the facility is expected to occur by the end of 2020. The REPA consists of two components: (1) an energy forward agreement that is net settled based on energy prices and the energy output generated by the facility and (2) a commitment to purchase environmental attributes (“EACs”) in the same amount as the energy output generated by the facility. T-Mobile USA will net settle the forward agreement and acquire the EACs monthly by paying, or receiving, an aggregate net payment based on two variables (1) the facility’s energy output, which has an estimated maximum capacity of approximately 150 megawatts and (2) the difference between (a) an initial fixed price, subject to annual escalation, and (b) current local marginal energy prices during the monthly settlement period. We have determined that the REPA does not meet the definition of a derivative because the expected energy output of the facility may not be reliably estimated (the arrangement lacks a notional amount). The REPA does not contain any unconditional purchase obligations because amounts under the agreement are not fixed and determinable. Our participation in the REPA did not require an upfront investment or capital commitment. We do not control the activities that most significantly impact the energy-generating facility nor do we receive specific energy output from it. No amounts were settled under the REPA during the six months ended June 30, 2018 . Contingencies and Litigation Litigation Matters We are involved in various lawsuits and disputes, claims, government agency investigations and enforcement actions, and other proceedings (“Litigation Matters”) that arise in the ordinary course of business, which include claims of patent infringement (most of which are asserted by non-practicing entities primarily seeking monetary damages), class actions, and proceedings to enforce FCC rules and regulations. The Litigation Matters described above have progressed to various stages and some of them may proceed to trial, arbitration, hearing or other adjudication that could result in fines, penalties, or awards of monetary or injunctive relief in the coming 12 months, if they are not otherwise resolved. We have established an accrual with respect to certain of these matters, where appropriate, which is reflected in the condensed consolidated financial statements but that we do not consider, individually or in the aggregate, material. An accrual is established when we believe it is both probable that a loss has been incurred and an amount can be reasonably estimated. For other matters, where we have not determined that a loss is probable or because the amount of loss cannot be reasonably estimated, we have not recorded an accrual due to various factors typical in contested proceedings, including but not limited to: uncertainty concerning legal theories and their resolution by courts or regulators; uncertain damage theories and demands; and a less than fully developed factual record. While we do not expect that the ultimate resolution of these proceedings, individually or in the aggregate, will have a material adverse effect on our financial position, an unfavorable outcome of some or all of these proceedings could have a material adverse impact on results of operations or cash flows for a particular period. This assessment is based on our current understanding of relevant facts and circumstances. As such, our view of these matters is subject to inherent uncertainties and may change in the future. |
Guarantor Financial Information
Guarantor Financial Information | 6 Months Ended |
Jun. 30, 2018 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Guarantor Financial Information | Note 15 – Guarantor Financial Information Pursuant to the applicable indentures and supplemental indentures, the long-term debt to affiliates and third parties issued by T-Mobile USA (“Issuer”) is fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by T-Mobile (“Parent”) and certain of the Issuer’s 100% owned subsidiaries (“Guarantor Subsidiaries”). In January 2018, T-Mobile USA and certain of its affiliates, as guarantors, issued (i) $1.0 billion of public 4.500% Senior Notes due 2026 and (ii) $1.5 billion of public 4.750% Senior Notes due 2028. In April 2018, T-Mobile USA and certain of its affiliates, as guarantors, issued (i) $1.0 billion in aggregate principal amount of 4.500% Senior Notes due 2026 and (ii) $1.5 billion in aggregate principal amount of 4.750% Senior Notes due 2028. Additionally, T-Mobile USA and certain of its affiliates, as guarantors, redeemed through net settlement, (i) the $1.25 billion in aggregate principal amount of 8.097% Senior Reset Notes due 2021 and (ii) $1.25 billion in aggregate principal amount of 8.195% Senior Reset Notes due 2022. See Note 9 - Debt for further information. The guarantees of the Guarantor Subsidiaries are subject to release in limited circumstances only upon the occurrence of certain customary conditions. The indentures and credit facilities governing the long-term debt contain covenants that, among other things, limit the ability of the Issuer and the Guarantor Subsidiaries to: incur more debt; pay dividends and make distributions; make certain investments; repurchase stock; create liens or other encumbrances; enter into transactions with affiliates; enter into transactions that restrict dividends or distributions from subsidiaries; and merge, consolidate, or sell, or otherwise dispose of, substantially all of their assets. Certain provisions of each of the credit facilities, indentures and supplemental indentures relating to the long-term debt restrict the ability of the Issuer to loan funds or make payments to Parent. However, the Issuer and Guarantor Subsidiaries are allowed to make certain permitted payments to the Parent under the terms of the indentures and the supplemental indentures. During the preparation of the condensed consolidating financial information of T-Mobile US, Inc. and Subsidiaries for the year ended December 31, 2017, it was determined that certain intercompany advances were misclassified in Net cash provided by (used in) operating activities and Net cash provided by (used in) financing activities in the Condensed Consolidating Statement of Cash Flows Information for the three and six months ended June 30, 2017 , as filed in our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2017 . We have revised the Issuer, Guarantor Subsidiaries and Non-Guarantor Subsidiaries columns of the Condensed Consolidating Statement of Cash Flows Information to reclassify Intercompany advances, net from Net cash provided by (used in) operating activities to Net cash provided by (used in) financing activities. The impacts to the Issuer, Guarantor Subsidiaries and Non-Guarantor Subsidiaries columns for the three months ended June 30, 2017 were $9.0 billion , $9.0 billion and $5 million , respectively and for the six months ended June 30, 2017 were $13.9 billion , $14.0 billion and $16 million , respectively. The revisions, which we have determined are not material, are eliminated upon consolidation and have no impact on our Condensed Consolidating Statement of Cash Flows Information . Presented below is the condensed consolidating financial information as of June 30, 2018 and December 31, 2017 , and for the three and six months ended June 30, 2018 and 2017 . Condensed Consolidating Balance Sheet Information June 30, 2018 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Assets Current assets Cash and cash equivalents $ 1 $ 3 $ 163 $ 48 $ — $ 215 Accounts receivable, net — — 1,411 219 — 1,630 Equipment installment plan receivables, net — — 2,308 — — 2,308 Accounts receivable from affiliates — — 11 — — 11 Inventories — — 998 — — 998 Other current assets — — 1,242 687 — 1,929 Total current assets 1 3 6,133 954 — 7,091 Property and equipment, net (1) — — 22,061 314 — 22,375 Goodwill — — 1,683 218 — 1,901 Spectrum licenses — — 35,532 — — 35,532 Other intangible assets, net — — 169 91 — 260 Investments in subsidiaries, net 24,212 43,582 — — (67,794 ) — Intercompany receivables and note receivables — 7,188 — — (7,188 ) — Equipment installment plan receivables due after one year, net — — 1,222 — — 1,222 Other assets — 6 1,220 237 (152 ) 1,311 Total assets $ 24,213 $ 50,779 $ 68,020 $ 1,814 $ (75,134 ) $ 69,692 Liabilities and Stockholders' Equity Current liabilities Accounts payable and accrued liabilities $ — $ 232 $ 6,166 $ 288 $ — $ 6,686 Payables to affiliates — 158 32 — — 190 Short-term debt — 300 703 1 — 1,004 Short-term debt to affiliates — 320 — — — 320 Deferred revenue — — 722 — — 722 Other current liabilities — — 175 184 — 359 Total current liabilities — 1,010 7,798 473 — 9,281 Long-term debt — 10,947 1,118 — — 12,065 Long-term debt to affiliates — 14,581 — — — 14,581 Tower obligations (1) — — 389 2,185 — 2,574 Deferred tax liabilities — — 4,239 — (152 ) 4,087 Deferred rent expense — — 2,746 — — 2,746 Negative carrying value of subsidiaries, net — — 620 — (620 ) — Intercompany payables and debt 823 — 6,087 278 (7,188 ) — Other long-term liabilities — 29 919 20 — 968 Total long-term liabilities 823 25,557 16,118 2,483 (7,960 ) 37,021 Total stockholders' equity (deficit) 23,390 24,212 44,104 (1,142 ) (67,174 ) 23,390 Total liabilities and stockholders' equity $ 24,213 $ 50,779 $ 68,020 $ 1,814 $ (75,134 ) $ 69,692 (1) Assets and liabilities for Non-Guarantor Subsidiaries are primarily included in VIEs related to the 2012 Tower Transaction. See Note 8 – Tower Obligations included in our Annual Report on Form 10-K for the year ended December 31, 2017 for further information. Condensed Consolidating Balance Sheet Information December 31, 2017 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Assets Current assets Cash and cash equivalents $ 74 $ 1 $ 1,086 $ 58 $ — $ 1,219 Accounts receivable, net — — 1,659 256 — 1,915 Equipment installment plan receivables, net — — 2,290 — — 2,290 Accounts receivable from affiliates — — 22 — — 22 Inventories — — 1,566 — — 1,566 Other current assets — — 1,275 628 — 1,903 Total current assets 74 1 7,898 942 — 8,915 Property and equipment, net (1) — — 21,890 306 — 22,196 Goodwill — — 1,683 — — 1,683 Spectrum licenses — — 35,366 — — 35,366 Other intangible assets, net — — 217 — — 217 Investments in subsidiaries, net 22,534 40,988 — — (63,522 ) — Intercompany receivables and note receivables — 8,503 — — (8,503 ) — Equipment installment plan receivables due after one year, net — — 1,274 — — 1,274 Other assets — 2 814 236 (140 ) 912 Total assets $ 22,608 $ 49,494 $ 69,142 $ 1,484 $ (72,165 ) $ 70,563 Liabilities and Stockholders' Equity Current liabilities Accounts payable and accrued liabilities $ — $ 253 $ 8,014 $ 261 $ — $ 8,528 Payables to affiliates — 146 36 — — 182 Short-term debt — 999 613 — — 1,612 Deferred revenue — — 779 — — 779 Other current liabilities 17 — 192 205 — 414 Total current liabilities 17 1,398 9,634 466 — 11,515 Long-term debt — 10,911 1,210 — — 12,121 Long-term debt to affiliates — 14,586 — — — 14,586 Tower obligations (1) — — 392 2,198 — 2,590 Deferred tax liabilities — — 3,677 — (140 ) 3,537 Deferred rent expense — — 2,720 — — 2,720 Negative carrying value of subsidiaries, net — — 629 — (629 ) — Intercompany payables and debt 32 — 8,201 270 (8,503 ) — Other long-term liabilities — 65 866 4 — 935 Total long-term liabilities 32 25,562 17,695 2,472 (9,272 ) 36,489 Total stockholders' equity (deficit) 22,559 22,534 41,813 (1,454 ) (62,893 ) 22,559 Total liabilities and stockholders' equity $ 22,608 $ 49,494 $ 69,142 $ 1,484 $ (72,165 ) $ 70,563 (1) Assets and liabilities for Non-Guarantor Subsidiaries are primarily included in VIEs related to the 2012 Tower Transaction. See Note 8 – Tower Obligations included in our Annual Report on Form 10-K for the year ended December 31, 2017, for further information. Condensed Consolidating Statement of Comprehensive Income Information Three Months Ended June 30, 2018 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Revenues Service revenues $ — $ — $ 7,609 $ 551 $ (229 ) $ 7,931 Equipment revenues — — 2,370 1 (46 ) 2,325 Other revenues — 2 267 55 (9 ) 315 Total revenues — 2 10,246 607 (284 ) 10,571 Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below — — 1,522 8 — 1,530 Cost of equipment sales — — 2,556 262 (46 ) 2,772 Selling, general and administrative — 6 3,201 216 (238 ) 3,185 Depreciation and amortization — — 1,611 23 — 1,634 Total operating expense — 6 8,890 509 (284 ) 9,121 Operating (loss) income — (4 ) 1,356 98 — 1,450 Other income (expense) Interest expense — (120 ) (28 ) (48 ) — (196 ) Interest expense to affiliates — (129 ) (4 ) — 5 (128 ) Interest income — 6 4 1 (5 ) 6 Other expense, net — (59 ) (5 ) — — (64 ) Total other expense, net — (302 ) (33 ) (47 ) — (382 ) Income (loss) before income taxes — (306 ) 1,323 51 — 1,068 Income tax expense — — (277 ) (9 ) — (286 ) Earnings of subsidiaries 782 1,088 23 — (1,893 ) — Net income $ 782 $ 782 $ 1,069 $ 42 $ (1,893 ) $ 782 Net income $ 782 $ 782 $ 1,069 $ 42 $ (1,893 ) $ 782 Other comprehensive income, net of tax Other comprehensive income, net of tax 3 3 3 — (6 ) 3 Total comprehensive income $ 785 $ 785 $ 1,072 $ 42 $ (1,899 ) $ 785 Condensed Consolidating Statement of Comprehensive Income Information Three Months Ended June 30, 2017 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Revenues Service revenues $ — $ — $ 7,127 $ 528 $ (210 ) $ 7,445 Equipment revenues — — 2,575 — (69 ) 2,506 Other revenues — — 216 51 (5 ) 262 Total revenues — — 9,918 579 (284 ) 10,213 Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below — — 1,512 6 — 1,518 Cost of equipment sales — — 2,664 251 (69 ) 2,846 Selling, general and administrative — — 2,933 197 (215 ) 2,915 Depreciation and amortization — — 1,501 18 — 1,519 Gains on disposal of spectrum licenses — — (1 ) — — (1 ) Total operating expense — — 8,609 472 (284 ) 8,797 Operating income — — 1,309 107 — 1,416 Other income (expense) Interest expense — (194 ) (23 ) (48 ) — (265 ) Interest expense to affiliates — (132 ) (5 ) — 6 (131 ) Interest income — 8 4 — (6 ) 6 Other expense, net — (91 ) (1 ) — — (92 ) Total other expense, net — (409 ) (25 ) (48 ) — (482 ) Income (loss) before income taxes — (409 ) 1,284 59 — 934 Income tax expense — — (333 ) (20 ) — (353 ) Earnings of subsidiaries 581 990 14 — (1,585 ) — Net income 581 581 965 39 (1,585 ) 581 Dividends on preferred stock (14 ) — — — — (14 ) Net income attributable to common stockholders $ 567 $ 581 $ 965 $ 39 $ (1,585 ) $ 567 Net income $ 581 $ 581 $ 965 $ 39 $ (1,585 ) $ 581 Other comprehensive income (loss), net of tax Other comprehensive income (loss), net of tax 1 1 1 (1 ) (1 ) 1 Total comprehensive income $ 582 $ 582 $ 966 $ 38 $ (1,586 ) $ 582 Condensed Consolidating Statement of Comprehensive Income Information Six Months Ended June 30, 2018 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Revenues Service revenues $ — $ — $ 15,096 $ 1,091 $ (450 ) $ 15,737 Equipment revenues — — 4,777 1 (100 ) 4,678 Other revenues — 3 516 110 (18 ) 611 Total revenues — 3 20,389 1,202 (568 ) 21,026 Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below — — 3,102 17 — 3,119 Cost of equipment sales — — 5,220 498 (101 ) 5,617 Selling, general and administrative — 6 6,358 452 (467 ) 6,349 Depreciation and amortization — — 3,165 44 — 3,209 Total operating expense — 6 17,845 1,011 (568 ) 18,294 Operating (loss) income — (3 ) 2,544 191 — 2,732 Other income (expense) Interest expense — (294 ) (57 ) (96 ) — (447 ) Interest expense to affiliates — (295 ) (9 ) — 10 (294 ) Interest income — 12 9 1 (10 ) 12 Other (expense) income, net — (91 ) 37 — — (54 ) Total other (expense) income, net — (668 ) (20 ) (95 ) — (783 ) Income (loss) before income taxes — (671 ) 2,524 96 — 1,949 Income tax expense — — (476 ) (20 ) — (496 ) Earnings of subsidiaries 1,453 2,124 17 — (3,594 ) — Net income $ 1,453 $ 1,453 $ 2,065 $ 76 $ (3,594 ) $ 1,453 Net income $ 1,453 $ 1,453 $ 2,065 $ 76 $ (3,594 ) $ 1,453 Other comprehensive income, net of tax Other comprehensive income, net of tax — — — — — — Total comprehensive income $ 1,453 $ 1,453 $ 2,065 $ 76 $ (3,594 ) $ 1,453 Condensed Consolidating Statement of Comprehensive Income Information Six Months Ended June 30, 2017 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Revenues Service revenues $ — $ — $ 14,145 $ 1,053 $ (424 ) $ 14,774 Equipment revenues — — 4,718 — (169 ) 4,549 Other revenues — — 410 103 (10 ) 503 Total revenues — — 19,273 1,156 (603 ) 19,826 Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below — — 2,914 12 — 2,926 Cost of equipment sales — — 5,204 497 (169 ) 5,532 Selling, general and administrative — — 5,861 443 (434 ) 5,870 Depreciation and amortization — — 3,047 36 — 3,083 Gains on disposal of spectrum licenses — — (38 ) — — (38 ) Total operating expenses — — 16,988 988 (603 ) 17,373 Operating income — — 2,285 168 — 2,453 Other income (expense) Interest expense — (458 ) (50 ) (96 ) — (604 ) Interest expense to affiliates — (231 ) (12 ) — 12 (231 ) Interest income — 17 8 — (12 ) 13 Other income (expense), net — (88 ) (2 ) — — (90 ) Total other expense, net — (760 ) (56 ) (96 ) — (912 ) Income (loss) before income taxes — (760 ) 2,229 72 — 1,541 Income tax expense — — (237 ) (25 ) — (262 ) Earnings (loss) of subsidiaries 1,279 2,039 (17 ) — (3,301 ) — Net income 1,279 1,279 1,975 47 (3,301 ) 1,279 Dividends on preferred stock (28 ) — — — — (28 ) Net income attributable to common stockholders $ 1,251 $ 1,279 $ 1,975 $ 47 $ (3,301 ) $ 1,251 Net income $ 1,279 $ 1,279 $ 1,975 $ 47 $ (3,301 ) $ 1,279 Other comprehensive income, net of tax Other comprehensive income, net of tax 2 2 2 — (4 ) 2 Total comprehensive income $ 1,281 $ 1,281 $ 1,977 $ 47 $ (3,305 ) $ 1,281 Condensed Consolidating Statement of Cash Flows Information Three Months Ended June 30, 2018 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Operating activities Net cash (used in) provided by operating activities $ (1 ) $ (258 ) $ 2,932 $ (1,282 ) $ (130 ) $ 1,261 Investing activities Purchases of property and equipment — — (1,624 ) (5 ) — (1,629 ) Purchases of spectrum licenses and other intangible assets — — (28 ) — — (28 ) Proceeds related to beneficial interests in securitization transactions — — 12 1,311 — 1,323 Acquisition of companies, net of cash acquired — — (5 ) — — (5 ) Equity investment in subsidiary — — (26 ) — 26 — Other, net — — 33 — — 33 Net cash (used in) provided by investing activities — — (1,638 ) 1,306 26 (306 ) Financing activities Proceeds from issuance of long-term debt — — — — — — Payments of consent fees related to long-term debt — — (38 ) — — (38 ) Proceeds from borrowing on revolving credit facility, net — 2,070 — — — 2,070 Repayments of revolving credit facility — — (2,195 ) — — (2,195 ) Repayments of capital lease obligations — — (154 ) (1 ) — (155 ) Repayments of long-term debt — — (2,350 ) — — (2,350 ) Repurchases of common stock (405 ) — — — — (405 ) Intercompany advances, net 405 (1,810 ) 1,406 (1 ) — — Equity investment from parent — — — 26 (26 ) — Tax withholdings on share-based awards — — (10 ) — — (10 ) Cash payments for debt prepayment or debt extinguishment costs — — (181 ) — — (181 ) Intercompany dividend paid — — — (130 ) 130 — Other, net 1 — (4 ) — — (3 ) Net cash provided by (used in) financing activities 1 260 (3,526 ) (106 ) 104 (3,267 ) Change in cash and cash equivalents — 2 (2,232 ) (82 ) — (2,312 ) Cash and cash equivalents Beginning of period 1 1 2,395 130 — 2,527 End of period $ 1 $ 3 $ 163 $ 48 $ — $ 215 Condensed Consolidating Statement of Cash Flows Information Three Months Ended June 30, 2017 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Operating activities Net cash provided by (used in) operating activities $ 1 $ (795 ) $ 2,816 $ (836 ) $ (80 ) $ 1,106 Investing activities Purchases of property and equipment — — (1,347 ) — — (1,347 ) Purchases of spectrum licenses and other intangible assets — — (5,791 ) — — (5,791 ) Proceeds related to beneficial interests in securitization transactions — — 11 871 — 882 Equity investment in subsidiary (308 ) — — — 308 — Other, net — — 5 — — 5 Net cash (used in) provided by investing activities (308 ) — (7,122 ) 871 308 (6,251 ) Financing activities Proceeds from issuance of long-term debt — 4,485 — — — 4,485 Proceeds from borrowing on revolving credit facility, net — 1,855 — — — 1,855 Repayments of revolving credit facility — — (1,175 ) — — (1,175 ) Repayments of capital lease obligations — — (119 ) — — (119 ) Repayments of short-term debt for purchases of inventory, property and equipment, net — — (292 ) — — (292 ) Repayments of long-term debt — — (6,750 ) — — (6,750 ) Intercompany advances, net — (8,990 ) 8,995 (5 ) — — Equity investment from parent — 308 — — (308 ) — Tax withholdings on share-based awards — — (3 ) — — (3 ) Intercompany dividend paid — — — (80 ) 80 — Dividends on preferred stock (14 ) — — — — (14 ) Cash payments for debt prepayment or debt extinguishment costs — — (159 ) — — (159 ) Other, net 4 — (7 ) — — (3 ) Net cash (used in) provided by financing activities (10 ) (2,342 ) 490 (85 ) (228 ) (2,175 ) Change in cash and cash equivalents (317 ) (3,137 ) (3,816 ) (50 ) — (7,320 ) Cash and cash equivalents Beginning of period 360 3,138 3,937 66 — 7,501 End of period $ 43 $ 1 $ 121 $ 16 $ — $ 181 Balances have been revised based on the guidance in ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” See Note 1 - Summary of Significant Accounting Policies of the Notes to the Condensed Consolidated Financial Statements, for further information. Condensed Consolidating Statement of Cash Flows Information Six Months Ended June 30, 2018 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Operating activities Net cash (used in) provided by operating activities $ — $ (662 ) $ 5,306 $ (2,483 ) $ (130 ) $ 2,031 Investing activities Purchases of property and equipment — — (2,990 ) (5 ) — (2,995 ) Purchases of spectrum licenses and other intangible assets — — (79 ) — — (79 ) Proceeds related to beneficial interests in securitization transactions — — 25 2,593 — 2,618 Acquisition of companies, net of cash acquired — — (338 ) — — (338 ) Equity investment in subsidiary — — (26 ) — 26 — Other, net — — 26 — — 26 Net cash (used in) provided by investing activities — — (3,382 ) 2,588 26 (768 ) Financing activities Proceeds from issuance of long-term debt — 2,494 — — — 2,494 Payments of consent fees related to long-term debt — — (38 ) — — (38 ) Proceeds from borrowing on revolving credit facility, net — 4,240 — — — 4,240 Repayments of revolving credit facility — — (3,920 ) — — (3,920 ) Repayments of capital lease obligations — — (326 ) (1 ) — (327 ) Repayments of long-term debt — — (3,349 ) — — (3,349 ) Repurchases of common stock (1,071 ) — — — — (1,071 ) Intercompany advances, net 995 (6,070 ) 5,085 (10 ) — — Equity investment from parent — — — 26 (26 ) — Tax withholdings on share-based awards — — (84 ) — — (84 ) Cash payments for debt prepayment or debt extinguishment costs — — (212 ) — — (212 ) Intercompany dividend paid — — — (130 ) 130 — Other, net 3 — (3 ) — — — Net cash (used in) provided by financing activities (73 ) 664 (2,847 ) (115 ) 104 (2,267 ) Change in cash and cash equivalents (73 ) 2 (923 ) (10 ) — (1,004 ) Cash and cash equivalents Beginning of period 74 1 1,086 58 — 1,219 End of period $ 1 $ 3 $ 163 $ 48 $ — $ 215 Condensed Consolidating Statement of Cash Flows Information Six Months Ended June 30, 2017 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Operating activities Net cash provided by (used in) operating activities $ 2 $ (929 ) $ 4,671 $ (1,950 ) $ (80 ) $ 1,714 Investing activities Purchases of property and equipment — — (2,875 ) — — (2,875 ) Purchases of spectrum licenses and other intangible assets — — (5,805 ) — — (5,805 ) Proceeds related to beneficial interests in securitization transactions — — 21 1,995 — 2,016 Equity investment in subsidiary (308 ) — — — 308 — Other, net — — (3 ) — — (3 ) Net cash (used in) provided by investing activities (308 ) — (8,662 ) 1,995 308 (6,667 ) Financing activities Proceeds from issuance of long-term debt — 9,980 — — — 9,980 Proceeds from borrowing on revolving credit facility, net — 1,855 — — — 1,855 Repayments of revolving credit facility — — (1,175 ) — — (1,175 ) Repayments of capital lease obligations — — (209 ) — — (209 ) Repayments of short-term debt for purchases of inventory, property and equipment, net — — (292 ) — — (292 ) Repayments of long-term debt — — (10,230 ) — — (10,230 ) Intercompany advances, net — (13,946 ) 13,962 (16 ) — — Equity investment from parent — 308 — — (308 ) — Tax withholdings on share-based awards — — (95 ) — — (95 ) Cash payments for debt prepayment or debt extinguishment costs — — (188 ) — — (188 ) Intercompany dividend paid — — — (80 ) 80 — Dividends on preferred stock (28 ) — — — — (28 ) Other, net 19 — (3 ) — — 16 Net cash (used in) provided by financing activities (9 ) (1,803 ) 1,770 (96 ) (228 ) (366 ) Change in cash and cash equivalents (315 ) (2,732 ) (2,221 ) (51 ) — (5,319 ) Cash and cash equivalents Beginning of period 358 2,733 2,342 67 — 5,500 End of period $ 43 $ 1 $ 121 $ 16 $ — $ 181 Balances have been revised based on the guidance in ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” See Note 1 - Summary of Significant Accounting Policies of the Notes to the Condensed Consolidated Financial Statements, for further information. |
Summary of Significant Accoun23
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The unaudited condensed consolidated financial statements of T-Mobile US, Inc. (“T-Mobile,” “we,” “our,” “us” or the “Company”) include all adjustments of a normal recurring nature necessary for the fair presentation of the results for the interim periods presented. The results for the interim periods are not necessarily indicative of those for the full year. The condensed consolidated financial statements should be read in conjunction with our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2017 . The condensed consolidated financial statements include the balances and results of operations of T-Mobile and our consolidated subsidiaries. We consolidate majority-owned subsidiaries over which we exercise control, as well as variable interest entities (“VIE”) where we are deemed to be the primary beneficiary and VIEs which cannot be deconsolidated, such as those related to Tower obligations (Tower obligations are included in VIEs related to the 2012 Tower Transaction. See Note 8 - Tower Obligations included in our Annual Report on Form 10-K for the year ended December 31, 2017 ). Intercompany transactions and balances have been eliminated in consolidation. |
Basis of Accounting | The preparation of financial statements in conformity with United States (“U.S.”) generally accepted accounting principles (“GAAP”) requires our management to make estimates and assumptions which affect the financial statements and accompanying notes. |
Use of Estimates | Estimates are based on historical experience, where applicable, and other assumptions which our management believes are reasonable under the circumstances. These estimates are inherently subject to judgment and actual results could differ from those estimates. |
Accounting Pronouncements Adopted During the Current Year and Accounting Pronouncements Not Yet Adopted | Accounting Pronouncements Adopted During the Current Year Revenue In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” and has since modified the standard with several ASUs (collectively, the “new revenue standard”). The new revenue standard requires entities to recognize revenue through the application of a five-step model, which includes: identification of the contract; identification of the performance obligations; determination of the transaction price; allocation of the transaction price to the performance obligations; and recognition of revenue as the entity satisfies the performance obligations. We adopted the new revenue standard on January 1, 2018, using the modified retrospective method with the cumulative effect of initially applying the guidance recognized at the date of initial application. Comparative information has not been restated and continues to be reported under the standards in effect for those periods. We have applied the new revenue standard only to contracts not completed as of the date of initial application, referred to as open contracts. We have elected the practical expedient that permits an entity to reflect the aggregate effect of all of the modifications (on a contract-by-contract basis) that occurred before the date of initial application in determining the transaction price, identifying the satisfied and unsatisfied performance obligations, and allocating the transaction price to the performance obligations. Electing this practical expedient does not have a significant impact on our financial statements due to the short-term duration of most of our contracts and the nature of our contract modifications. We have implemented significant new revenue accounting systems, processes and internal controls over revenue recognition to assist us in the application of the new revenue standard. The most significant impacts to financial statement results as reported under the new revenue standard as compared to the previous revenue standard for the current reporting period are as follows: • Under the new revenue standard, certain commissions paid to dealers previously recognized as a reduction to Equipment revenues in our Condensed Consolidated Statements of Comprehensive Income are now recorded as commission costs in Selling, general and administrative expense. • Contract costs capitalized for new contracts will accumulate in Other assets in our Condensed Consolidated Balance Sheets during 2018. As a result, there will be a net benefit to Operating income in our Condensed Consolidated Statements of Comprehensive Income during 2018 as capitalization of costs exceed amortization. As capitalized costs amortize into expense over time, the accretive benefit to Operating income anticipated in 2018 is expected to moderate in 2019 and normalize in 2020. • For contracts with promotional bill credits that are contingent on the customer maintaining a service contract that result in an extended service contract, a contract asset is recorded when control of the equipment transfers to the customer and is subsequently amortized as a reduction to Total service revenues in our Condensed Consolidated Statements of Comprehensive Income over the extended contract term. See disclosures related to Contracts with Customers under the new revenue standard in Note 11 - Revenue from Contracts with Customers . Statement of Cash Flows In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” (the “new cash flow standard”). The new cash flow standard is intended to reduce current diversity in practice and provides guidance on how certain cash receipts and payments are presented and classified in the statement of cash flows. We adopted the new cash flow standard on January 1, 2018, which was the date it became effective for us. We have applied the new cash flow standard retrospectively to all periods presented. The new cash flow standard impacted the presentation of cash flows related to our beneficial interests in securitization transactions, which is the deferred purchase price, resulting in a reclassification of cash inflows from Operating activities to Investing activities of $1.3 billion and $882 million for the three months ended June 30, 2018 and 2017 , respectively, and $2.6 billion and $2.0 billion for the six months ended June 30, 2018 and 2017 , respectively, in our Condensed Consolidated Statements of Cash Flows . The new cash flow standard also impacted the presentation of our cash payments for debt prepayment and debt extinguishment costs, resulting in a reclassification of cash outflows from Operating activities to Financing activities of $181 million and $159 million for the three months ended June 30, 2018 and 2017 , respectively, and $212 million and $188 million for the six months ended June 30, 2018 and 2017 , respectively, in our Condensed Consolidated Statements of Cash Flows . Financial Instruments In January 2016, the FASB issued ASU 2016-01, “Financial Instruments (Topic 825): Recognition and Measurement of Financial Assets and Financial Liabilities,” and has since modified the standard in February 2018 with ASU 2018-03, “Technical Corrections and Improvements to Financial Instruments - Overall” (Subtopic 825-10). The standard addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The standard became effective for us, and we adopted the standard, on January 1, 2018. The standard requires the impact of adoption to be recorded to retained earnings under a modified retrospective approach. The implementation of this standard did not have a material impact on our condensed consolidated financial statements . Income Taxes In October 2016, the FASB issued ASU 2016-16, “Accounting for Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory.” The standard requires that the income tax impact of intra-entity sales and transfers of property, except for inventory, be recognized when the transfer occurs. The standard became effective for us, and we adopted the standard, on January 1, 2018. The standard requires any deferred taxes not yet recognized on intra-entity transfers to be recorded to retained earnings under a modified retrospective approach. The implementation of this standard did not have a material impact on our condensed consolidated financial statements . Accounting Pronouncements Not Yet Adopted Leases In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” and has since modified the standard in January 2018 with ASU 2018-01, “Land Easement Practical Expedient for Transition to Topic 842” and in July 2018 with ASU 2018-11 “Targeted Improvements” (collectively, the “new lease standard”). The new lease standard requires all lessees to report a right-of-use asset and a lease liability for most leases. The income statement recognition is similar to existing lease accounting and is based on lease classification. The new lease standard requires lessees and lessors to classify most leases using principles similar to existing lease accounting. For lessors, the new lease standard modifies the classification criteria and the accounting for sales-type and direct financing leases. We are currently evaluating the new lease standard, which will require recognizing and measuring leases at the beginning of the earliest period presented using a modified retrospective approach. Our evaluation includes assessing which of our arrangements qualify as a lease, and aggregating lease data and related information as well as determining whether previous conclusions for certain transactions, such as failed sale leaseback arrangements under the previous lease standard, Leases (Topic 840), would change under the new lease standard. We plan to adopt the new lease standard when it becomes effective for us beginning January 1, 2019, and expect the adoption of the new lease standard will result in the recognition of right-of-use assets and lease liabilities that have not previously been recorded, which will have a material impact on our condensed consolidated financial statements . We are in the process of implementing significant new lease accounting systems, processes and internal controls over lease recognition, which will ultimately assist in the application of the new lease standard. Financial Instruments In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” The standard requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectability of the reported amount. The standard will become effective for us beginning January 1, 2020, and will require a cumulative-effect adjustment to Accumulated deficit as of the beginning of the first reporting period in which the guidance is effective (that is, a modified-retrospective approach). Early adoption is permitted for us as of January 1, 2019. We are currently evaluating the impact this guidance will have on our condensed consolidated financial statements and the timing of adoption. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the Securities and Exchange Commission (“SEC”) did not have, or are not believed by management to have, a significant impact on our present or future consolidated financial statements. |
Revenue Recognition | Revenue Recognition We primarily generate our revenue from providing wireless services to customers and selling or leasing devices and accessories. Our contracts with customers may involve multiple performance obligations, which include wireless services, wireless devices or a combination thereof, and we allocate the transaction price between each performance obligation based on its relative standalone selling price. Significant Judgments The most significant judgments affecting the amount and timing of revenue from contracts with our customers include the following items: • For transactions where we recognize a significant financing component, judgment is required to determine the discount rate. For equipment installment plan (“EIP”) sales, the discount rate used to adjust the transaction price primarily reflects current market interest rates and the estimated credit risk of the customer. • Our products are generally sold with a right of return, which is accounted for as variable consideration when estimating the amount of revenue to recognize. Expected device returns are estimated based on historical experience. • Promotional bill credits offered to a customer on an equipment sale that are paid over time and are contingent on the customer maintaining a service contract may result in an extended service contract based on whether a substantive penalty is deemed to exist. Determining whether contingent bill credits result in a substantive termination penalty, and determining the term over which a substantive termination penalty exists, may require significant judgment. • For capitalized contract costs, determining the amortization period as well as assessing the indicators of impairment may require significant judgment. • The determination of the standalone selling price for contracts that involve more than one product or service (or performance obligation) may require significant judgment. • The identification of distinct performance obligations within our service plans may require significant judgment. Wireless Services Revenue We generate our wireless services revenues from providing access to, and usage of, our wireless communications network. Service revenues also include revenues earned for providing value added services to customers, such as handset insurance services. Service contracts are billed monthly either in advance or arrears, or are prepaid. Generally, service revenue is recognized as we satisfy our performance obligation to transfer service to our customers. We typically satisfy our stand-ready performance obligations, including unlimited wireless services, evenly over the contract term. For usage-based and prepaid wireless services, we satisfy our performance obligations when services are rendered. Revenue for service contracts that we assess are not probable of collection is not recognized until the contract is completed and cash is received. Collectibility is re-assessed when there is a significant change in facts or circumstances. Our assessment of collectibility considers whether we may limit our exposure to credit risk through our right to stop transferring additional service in the event the customer is delinquent. Consideration payable to a customer is treated as a reduction of the total transaction price, unless the payment is in exchange for a distinct good or service, such as certain commissions paid to dealers. Revenue is recorded net of costs paid to another party for performance obligations where we arrange for the other party to transfer goods or services to the customer (i.e., when we are acting as an agent). For example, performance obligations relating to services provided by third-party content providers where T-Mobile neither controls a right to the content provider’s service nor controls the underlying service itself are presented net because T-Mobile is acting as an agent. Federal Universal Service Fund and other regulatory fees are assessed by various governmental authorities in connection with the services we provide to our customers and are included in Cost of services. When we separately bill and collect these regulatory fees from customers, they are recorded in Total service revenues in our Condensed Consolidated Statements of Comprehensive Income . We have made an accounting policy election to exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by T-Mobile from a customer (for example, sales, use, value added, and some excise taxes). Equipment Revenues We generate equipment revenues from the sale or lease of mobile communication devices and accessories. For performance obligations related to equipment contracts, we typically transfer control at a point in time when the device or accessory is delivered to, and accepted by, the customer or dealer. We have elected to account for shipping and handling activities that occur after control of the related good transfers as fulfillment activities instead of assessing such activities as performance obligations. We establish provisions for estimated device returns based on historical experience. Equipment sales not probable of collection are generally recorded as payments are received. Our assessment of collectibility considers contract terms such as down payments that reduce our exposure to credit risk. We offer certain customers the option to pay for devices and accessories in installments using an EIP. Generally, we recognize as a reduction of the total transaction price the effects of a financing component in contracts where customers purchase their devices and accessories on an EIP with a term of more than one year, including those financing components that are not considered to be significant to the contract. However, we have elected the practical expedient to not recognize the effects of a significant financing component for contracts where we expect, at contract inception, that the period between the transfer of a performance obligation to a customer and the customer’s payment for that performance obligation will be one year or less. In addition, for customers who enroll in our Just Upgrade My Phone (“JUMP!” ® ) program, we recognize a liability based on the estimated fair value of the specified-price trade-in right guarantee. The fair value of the guarantee is deducted from the transaction price under the new revenue standard, and the remaining transaction price is allocated to other elements of the contract, including service and equipment performance obligations. See “Guarantee Liabilities” in Note 1 - Summary of Significant Accounting Policies included in our Annual Report on Form 10-K for the year ended December 31, 2017. In 2015, we introduced JUMP! On Demand, which allows customers to lease a device and upgrade their leased wireless device for a new device up to one time per month. To date, all of our leased wireless devices are accounted for as operating leases and estimated contract consideration is allocated between lease elements and non-lease elements (such as service and equipment performance obligations) based on the relative standalone selling price of each performance obligation in the contract. Lease revenues are recorded as equipment revenues and recognized as earned on a straight-line basis over the lease term. Lease revenues on contracts not probable of collection are limited to the amount of payments received. See “Property and Equipment” in Note 1 - Summary of Significant Accounting Policies included in our Annual Report on Form 10-K for the year ended December 31, 2017. Contract Balances Generally, T-Mobile devices and service plans are available at standard prices, which are maintained on price lists and published on our website and/or within our retail stores. For contracts that involve more than one product or service that are identified as separate performance obligations, the transaction price is allocated to the performance obligations based on their relative standalone selling prices. Standalone selling price is the price at which T-Mobile would sell the good or service separately to a customer and is most commonly evidenced by the price at which T-Mobile sells that good or service separately in similar circumstances and to similar customers. A contract asset is recorded when revenue is recognized in advance of our right to receive consideration (i.e., we must perform additional services in order to receive consideration). Amounts are recorded as receivables when our right to consideration is unconditional. When consideration is received or we have an unconditional right to consideration in advance of delivery of goods or services, a contract liability is recorded. The transaction price can include non-refundable upfront fees, which are allocated to the identifiable performance obligations. Contract assets are included in Other current assets and Other assets and contract liabilities are included in Deferred revenue in our Condensed Consolidated Balance Sheets . Contract Modifications Our service contracts allow customers to frequently modify their contracts without incurring penalties in many cases. Each time a contract is modified, we evaluate the change in scope or price of the contract to determine if the modification should be treated as a separate contract, as if there is a termination of the existing contract and creation of a new contract, or if the modification should be considered a change associated with the existing contract. We typically do not have significant impacts from contract modifications. Contract Costs We incur certain incremental costs to obtain a contract that we expect to recover, such as sales commissions. We record an asset when these incremental costs to obtain a contract are incurred and amortize them on a systematic basis that is consistent with the transfer to the customer of the goods or services to which the asset relates. We amortize deferred costs incurred to obtain service contracts on a straight-line basis over the term of the initial contract and anticipated renewal contracts to which the costs relate. However, we have elected the practical expedient permitting expensing of costs to obtain a contract when the expected amortization period is one year or less. Incremental costs to obtain equipment contracts (e.g., commissions paid on device and accessory sales) are recognized when the equipment is transferred to the customer. |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Financial Statement Impacts of Applying New Accounting Standard | The cumulative effect of initially applying the new revenue standard to all open contracts as of January 1, 2018 is as follows: January 1, 2018 (in millions) Beginning Balance Cumulative Effect Adjustment Beginning Balance, As Adjusted Assets Other current assets $ 1,903 $ 140 $ 2,043 Other assets 912 150 1,062 Liabilities and Stockholders’ Equity Deferred revenue $ 779 $ 4 $ 783 Deferred tax liabilities 3,537 73 3,610 Accumulated deficit (16,074 ) 213 (15,861 ) The most significant impacts upon adoption of the new revenue standard on January 1, 2018 include the following items: • A deferred contract cost asset of $150 million was recorded at transition in Other assets in our Condensed Consolidated Balance Sheets for incremental contract acquisition costs paid on open contracts, which consists primarily of commissions paid to acquire branded postpaid service contracts; and • A contract asset of $140 million was recorded at transition in Other current assets in our Condensed Consolidated Balance Sheets primarily for contracts with promotional bill credits offered to customers on equipment sales that are paid over time and are contingent on the customer maintaining a service contract. Financial statement results as reported under the new revenue standard as compared to the previous revenue standard for the three and six months ended and as of June 30, 2018 are as follows: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 (in millions, except per share amounts) Previous Revenue Standard New Revenue Standard Change Previous Revenue Standard New Revenue Standard Change Revenues Branded postpaid revenues $ 5,162 $ 5,164 $ 2 $ 10,261 $ 10,234 $ (27 ) Branded prepaid revenues 2,404 2,402 (2 ) 4,807 4,804 (3 ) Wholesale revenues 275 275 — 541 541 — Roaming and other service revenues 90 90 — 158 158 — Total service revenues 7,931 7,931 — 15,767 15,737 (30 ) Equipment revenues 2,229 2,325 96 4,505 4,678 173 Other revenues 315 315 — 611 611 — Total revenues 10,475 10,571 96 20,883 21,026 143 Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below 1,504 1,530 26 3,093 3,119 26 Cost of equipment sales 2,779 2,772 (7 ) 5,624 5,617 (7 ) Selling, general and administrative 3,192 3,185 (7 ) 6,404 6,349 (55 ) Depreciation and amortization 1,634 1,634 — 3,209 3,209 — Total operating expenses 9,109 9,121 12 18,330 18,294 (36 ) Operating income 1,366 1,450 84 2,553 2,732 179 Total other expense, net (382 ) (382 ) — (783 ) (783 ) — Income before income taxes 984 1,068 84 1,770 1,949 179 Income tax expense (264 ) (286 ) (22 ) (450 ) (496 ) (46 ) Net income $ 720 $ 782 $ 62 $ 1,320 $ 1,453 $ 133 Earnings per share Basic earnings per share $ 0.85 $ 0.92 $ 0.07 $ 1.55 $ 1.71 $ 0.16 Diluted earnings per share $ 0.85 $ 0.92 $ 0.07 $ 1.54 $ 1.69 $ 0.15 June 30, 2018 (in millions) Previous Revenue Standard New Revenue Standard Change Assets Other current assets $ 1,861 $ 1,929 $ 68 Other assets 901 1,311 410 Liabilities and Stockholders’ Equity Deferred revenue $ 709 $ 722 $ 13 Deferred tax liabilities 3,968 4,087 119 Accumulated deficit (14,735 ) (14,389 ) 346 |
Significant Transactions (Table
Significant Transactions (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Significant Transactions Disclosure [Abstract] | |
Schedule of Hurricane Impacts | The following table shows the hurricane impacts in our Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2018 are as follows: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 (in millions, except per share amounts) Gross Reim- Net Gross Reim- Net Increase (decrease) Cost of services $ — $ (70 ) $ (70 ) $ 36 $ (70 ) $ (34 ) Total operating expenses $ — $ (70 ) $ (70 ) $ 36 $ (70 ) $ (34 ) Operating income (loss) $ — $ 70 $ 70 $ (36 ) $ 70 $ 34 Net income (loss) $ — $ 45 $ 45 $ (23 ) $ 45 $ 22 Earnings per share - basic $ — $ 0.06 $ 0.06 $ (0.03 ) $ 0.06 $ 0.03 Earnings per share - diluted $ — $ 0.06 $ 0.06 $ (0.03 ) $ 0.06 $ 0.03 |
Business Combinations (Tables)
Business Combinations (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Schedule of Amounts Recognized as of Acquisition Date | The following table shows the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed and the resultant purchase price allocation: (in millions) January 22, Assets acquired Cash and cash equivalents $ 2 Other current assets 14 Property and equipment, net 11 Intangible assets 100 Goodwill 218 Deferred tax assets 2 Total assets acquired $ 347 Liabilities assumed Accounts payable and accrued liabilities $ 27 Short-term debt 2 Total liabilities assumed 29 Total consideration transferred $ 318 The following table shows the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed and the resultant purchase price allocation: (in millions) January 1, Assets acquired Current assets Cash and cash equivalents $ 3 Accounts receivable, net 6 Equipment installment plan receivables, net 3 Inventories 1 Other current assets 2 Total current assets 15 Property and equipment, net 36 Spectrum licenses 87 Total assets acquired $ 138 Liabilities assumed Accounts payable and accrued liabilities $ 6 Deferred revenue 2 Total current liabilities 8 Deferred tax liabilities 17 Other long-term liabilities 7 Total long-term liabilities 24 Net assets acquired $ 106 |
Schedule of Consideration Transferred | The following table highlights the consideration transferred, the fair value of our previously held equity interest and bargain purchase: (in millions) January 1, Consideration transferred: Cash paid $ 25 Previously held equity interest: Acquisition date fair value of previously held equity interest 56 Bargain purchase gain 25 Net assets acquired $ 106 |
Receivables and Allowance for27
Receivables and Allowance for Credit Losses (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Receivables [Abstract] | |
Schedule of Equipment Installment Plan Receivables | The following table summarizes the EIP receivables, including imputed discounts and related allowance for credit losses: (in millions) June 30, December 31, EIP receivables, gross $ 3,914 $ 3,960 Unamortized imputed discount (268 ) (264 ) EIP receivables, net of unamortized imputed discount 3,646 3,696 Allowance for credit losses (116 ) (132 ) EIP receivables, net $ 3,530 $ 3,564 Classified on the balance sheet as: Equipment installment plan receivables, net $ 2,308 $ 2,290 Equipment installment plan receivables due after one year, net 1,222 1,274 EIP receivables, net $ 3,530 $ 3,564 |
Schedule of Unamortized Imputed Discount and Allowance for Credit Losses for Equipment Installment Plan Receivables | Activity for the six months ended June 30, 2018 and 2017 , in the allowance for credit losses and unamortized imputed discount balances for the accounts receivable and EIP receivable segments were as follows: June 30, 2018 June 30, 2017 (in millions) Accounts Receivable Allowance EIP Receivables Allowance Total Accounts Receivable Allowance EIP Receivables Allowance Total Allowance for credit losses and imputed discount, beginning of period $ 86 $ 396 $ 482 $ 102 $ 316 $ 418 Bad debt expense 25 103 128 56 119 175 Write-offs, net of recoveries (41 ) (119 ) (160 ) (75 ) (137 ) (212 ) Change in imputed discount on short-term and long-term EIP receivables N/A 102 102 N/A 121 121 Impact on the imputed discount from sales of EIP receivables N/A (98 ) (98 ) N/A (85 ) (85 ) Allowance for credit losses and imputed discount, end of period $ 70 $ 384 $ 454 $ 83 $ 334 $ 417 |
Schedule of Equipment Installment Plan Receivables by Credit Category | The following table provides delinquency status for the unpaid principal balance for receivables within the EIP portfolio segment, which we actively monitor as part of our current credit risk management practices and policies: June 30, 2018 December 31, 2017 (in millions) Prime Subprime Total EIP Receivables, gross Prime Subprime Total EIP Receivables, gross Current - 30 days past due $ 1,630 $ 2,204 $ 3,834 $ 1,727 $ 2,133 $ 3,860 31 - 60 days past due 12 27 39 17 29 46 61 - 90 days past due 5 14 19 6 16 22 More than 90 days past due 6 16 22 8 24 32 Total receivables, gross $ 1,653 $ 2,261 $ 3,914 $ 1,758 $ 2,202 $ 3,960 |
Sales of Certain Receivables (T
Sales of Certain Receivables (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Transfers and Servicing [Abstract] | |
Schedule of Variable Interest Entities | The following table summarizes the carrying amounts and classification of assets, which consists primarily of the deferred purchase price and liabilities included in our Condensed Consolidated Balance Sheets that relate to our variable interest in the Service VIE: (in millions) June 30, December 31, Other current assets $ 287 $ 236 Accounts payable and accrued liabilities 10 25 Other current liabilities 159 180 |
Schedule of variable interest entities - EIP | The following table summarizes the carrying amounts and classification of assets, which consists primarily of the deferred purchase price and liabilities included in our Condensed Consolidated Balance Sheets that relate to the EIP BRE: (in millions) June 30, December 31, Other current assets $ 394 $ 403 Other assets 99 109 Other long-term liabilities 20 3 |
Schedule of Factoring Arrangement | The following table summarizes the impacts of the sale of certain service receivables and EIP receivables in our Condensed Consolidated Balance Sheets : (in millions) June 30, December 31, Derecognized net service receivables and EIP receivables $ 2,679 $ 2,725 Other current assets 681 639 of which, deferred purchase price 679 636 Other long-term assets 99 109 of which, deferred purchase price 99 109 Accounts payable and accrued liabilities 10 25 Other current liabilities 159 180 Other long-term liabilities 20 3 Net cash proceeds since inception 1,933 2,058 Of which: Change in net cash proceeds during the year-to-date period (125 ) 28 Net cash proceeds funded by reinvested collections 2,058 2,030 |
Goodwill (Tables)
Goodwill (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill for the six months ended June 30, 2018 , are as follows: (in millions) Goodwill Historical goodwill $ 12,449 Accumulated impairment losses at December 31, 2017 (10,766 ) Balance as of December 31, 2017 1,683 Goodwill from acquisition of Layer3 TV 218 Balance as of June 30, 2018 $ 1,901 Accumulated impairment losses at June 30, 2018 $ (10,766 ) |
Spectrum License Transactions (
Spectrum License Transactions (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Spectrum Licenses | The following table summarizes our spectrum license activity for the six months ended June 30, 2018 : (in millions) Spectrum Licenses Balance at December 31, 2017 $ 35,366 Spectrum license acquisitions 136 Costs to clear spectrum 30 Balance at June 30, 2018 $ 35,532 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Values and Fair Values of Long-term Debt | The carrying amounts and fair values of our short-term and long-term debt included in our Condensed Consolidated Balance Sheets were as follows: Level within the Fair Value Hierarchy June 30, 2018 December 31, 2017 (in millions) Carrying Amount Fair Value Carrying Amount Fair Value Liabilities: Senior Notes to third parties 1 $ 10,947 $ 11,159 $ 11,910 $ 12,540 Senior Notes to affiliates 2 9,983 10,015 7,486 7,852 Incremental Term Loan Facility to affiliates 2 4,000 3,973 4,000 4,020 Senior Reset Notes to affiliates 2 598 658 3,100 3,260 The carrying amounts and fair values of our assets measured at fair value on a recurring basis included in our Condensed Consolidated Balance Sheets were as follows: Level within the Fair Value Hierarchy June 30, 2018 December 31, 2017 (in millions) Carrying Amount Fair Value Carrying Amount Fair Value Assets: Deferred purchase price assets 3 $ 778 $ 778 $ 745 $ 745 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | We used the net proceeds of $2.5 billion from the transaction to refinance existing indebtedness to DT as follows: (in millions) Principal Amount Write -off of Embedded Derivatives (1) Other (2) Redemption Redemption Price 8.097% Senior Reset Notes due 2021 $ 1,250 $ (8 ) $ 51 April 28, 2018 104.0485 % 8.195% Senior Reset Notes due 2022 1,250 (8 ) 51 April 28, 2018 104.0975 % (1) Certain components of the reset features were required to be bifurcated from the DT Senior Reset Notes and separately accounted for as embedded derivative instruments. Write-off of embedded derivatives are included in Losses on redemption of debt within Net cash provided by operating activities in our Condensed Consolidated Statements of Cash Flows . (2) Cash for the premium portion of the redemption price set forth in the indenture governing the DT Senior Reset Notes, plus accrued but unpaid interest on the DT Senior Reset Notes to, but not including, the exchange date. During the six months ended June 30, 2018 , we issued the following Senior Notes: (in millions) Principal Issuances Issuance Costs Net Proceeds from Issuance of Long-Term Debt Issue Date 4.500% Senior Notes due 2026 $ 1,000 $ 2 $ 998 January 25, 2018 4.750% Senior Notes due 2028 1,500 4 1,496 January 25, 2018 Total of Senior Notes issued $ 2,500 $ 6 $ 2,494 Activity for the six months ended June 30, 2018 , related to our debt was as follows: (in millions) December 31, Proceeds from Issuances and Borrowings (1)(3) Note Redemptions (1)(3) Repayments Reclassifications (1) Consent Fees Other (2) June 30, Short-term debt $ 1,612 $ — $ (3,424 ) $ — $ 2,425 $ — $ 391 $ 1,004 Long-term debt 12,121 2,494 — — (2,425 ) (31 ) (94 ) 12,065 Total debt to third parties 13,733 2,494 (3,424 ) — — (31 ) 297 13,069 Short-term debt to affiliates — 4,240 — (3,920 ) — — — 320 Long-term debt to affiliates 14,586 — — — — (7 ) 2 14,581 Total debt to affiliates 14,586 4,240 — (3,920 ) — (7 ) 2 14,901 Total debt $ 28,319 $ 6,734 $ (3,424 ) $ (3,920 ) $ — $ (38 ) $ 299 $ 27,970 (1) Issuances and borrowings, note redemptions, and reclassifications are recorded net of related issuance costs, discounts, and premiums. Issuances and borrowings and repayments for Short-term debt to affiliates represent net outstanding borrowings and net repayments on our revolving credit facility. (2) Other includes: $300 million of issuances of short-term debt related to vendor financing arrangements, of which $291 million related to financing of property and equipment. During the six months ended June 30, 2018 , we did not have any repayments under the vendor financing arrangements. Vendor financing arrangements are included in Short-term debt within Total current liabilities in our Condensed Consolidated Balance Sheets. Other also includes capital leases and the amortization of issuance costs, discounts, premiums, and consent fees. Capital lease liabilities totaled $1.8 billion at both June 30, 2018 and December 31, 2017 . (3) Through net settlement on April 30, 2018, we issued to DT a total of $2.5 billion in aggregate principal amount of New DT Notes (as defined below) and redeemed $1.25 billion in aggregate principal amount of 8.097% Senior Reset Notes due 2021 and $1.25 billion in aggregate principal amount of 8.195% Senior Reset Notes due 2022 (collectively, the “DT Senior Reset Notes”) held by DT. |
Debt Instrument Redemption | During the six months ended June 30, 2018 , we made the following note redemptions: (in millions) Principal Amount Write-off of Premiums, Discounts and Issuance Costs (1) Call Penalties (1) (2) Redemption Redemption Price 6.125% Senior Notes due 2022 $ 1,000 $ 1 $ 31 January 15, 2018 103.063 % 6.625% Senior Notes due 2023 1,750 (75 ) 58 April 1, 2018 103.313 % 6.836% Senior Notes due 2023 600 — 21 April 28, 2018 103.418 % (1) Write-off of premiums, discounts, issuance costs and call penalties are included in Other expense, net in our Condensed Consolidated Statements of Comprehensive Income . Write-off of premiums, discounts and issuance costs are included in Losses on redemption of debt within Net cash provided by operating activities in our Condensed Consolidated Statements of Cash Flows . (2) The call penalty is the excess paid over the principal amount. Call penalties are included within Net cash used in financing activities in our Condensed Consolidated Statements of Cash Flows . |
Employee Compensation and Ben33
Employee Compensation and Benefit Plans (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock-based Compensation Expense and Related Income Tax Benefits and Activity | Stock-based compensation expense and related income tax benefits were as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions, except shares, per share and contractual life amounts) 2018 2017 2018 2017 Stock-based compensation expense $ 112 $ 72 $ 209 $ 139 Income tax benefit related to stock-based compensation $ 22 $ 16 $ 42 $ 32 Weighted average fair value per stock award granted $ 72.32 $ 63.94 $ 61.86 $ 63.24 Unrecognized compensation expense $ 712 $ 478 $ 712 $ 478 Weighted average period to be recognized (years) 2.1 1.9 2.1 1.9 Fair value of stock awards vested $ 30 $ 12 $ 267 $ 295 Restricted Stock Units and Restricted Stock Awards (in millions, except shares, per share and contractual life amounts) Number of Units or Awards Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Nonvested, December 31, 2017 12,061,608 $ 50.69 1.1 $ 766 Granted 5,766,642 59.91 Vested 3,448,666 45.03 Forfeited 450,845 56.39 Nonvested, June 30, 2018 13,928,739 55.94 1.2 832 Performance-Based Restricted Stock Units (in millions, except shares, per share and contractual life amounts) Number of Units Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Nonvested, December 31, 2017 1,633,935 $ 48.06 1.1 $ 104 Granted 3,168,197 65.97 Vested 1,006,769 36.47 Forfeited 11,580 66.32 Nonvested, June 30, 2018 3,783,783 62.62 1.9 226 PRSUs included in the table above are shown at target. Share payout can range from 0 to 200% based on different performance outcomes. |
Revenue from Contracts with C34
Revenue from Contracts with Customers (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | Branded postpaid service revenues, including branded postpaid phone revenues and branded postpaid other revenues, were as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions) 2018 2017 2018 2017 Branded postpaid service revenues Branded postpaid phone revenues $ 4,892 $ 4,565 $ 9,703 $ 9,065 Branded postpaid other revenues 272 255 531 480 Total branded postpaid service revenues $ 5,164 $ 4,820 $ 10,234 $ 9,545 Equipment revenues from the lease of mobile communication devices and accessories were as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions) 2018 2017 2018 2017 Equipment revenues from the lease of mobile communication devices and accessories $ 177 $ 234 $ 348 $ 558 |
Schedule of Contract Liability and Receivable Balances | The opening and closing balances of our contract asset and contract liability balances from contracts with customers as of January 1, 2018 and June 30, 2018 , were as follows: (in millions) Contract Assets Included in Other Current Assets Contract Liabilities Included in Deferred Revenue Balance as of January 1, 2018 $ 140 $ 718 Balance as of June 30, 2018 69 677 Change $ (71 ) $ (41 ) Revenues for the three and six months ended June 30, 2018 , include the following: (in millions) Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Amounts included in the January 1, 2018 contract liability balance $ 31 $ 559 Amounts associated with performance obligations satisfied in previous periods 11 11 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | The computation of basic and diluted earnings per share was as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions, except shares and per share amounts) 2018 2017 2018 2017 Net income $ 782 $ 581 $ 1,453 $ 1,279 Less: Dividends on mandatory convertible preferred stock — (14 ) — (28 ) Net income attributable to common stockholders - basic 782 567 1,453 1,251 Add: Dividends related to mandatory convertible preferred stock — 14 — 28 Net income attributable to common stockholders - diluted $ 782 $ 581 $ 1,453 $ 1,279 Weighted average shares outstanding - basic 847,660,488 830,971,528 851,420,686 829,356,255 Effect of dilutive securities: Outstanding stock options and unvested stock awards 4,380,182 7,247,653 7,308,146 9,260,131 Mandatory convertible preferred stock — 32,238,000 — 32,238,000 Weighted average shares outstanding - diluted 852,040,670 870,457,181 858,728,832 870,854,386 Earnings per share - basic $ 0.92 $ 0.68 $ 1.71 $ 1.51 Earnings per share - diluted $ 0.92 $ 0.67 $ 1.69 $ 1.47 Potentially dilutive securities: Outstanding stock options and unvested stock awards 797,948 48,397 487,133 71,734 |
Guarantor Financial Informati36
Guarantor Financial Information (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Schedule of Condensed Consolidating Balance Sheet Information | Condensed Consolidating Balance Sheet Information June 30, 2018 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Assets Current assets Cash and cash equivalents $ 1 $ 3 $ 163 $ 48 $ — $ 215 Accounts receivable, net — — 1,411 219 — 1,630 Equipment installment plan receivables, net — — 2,308 — — 2,308 Accounts receivable from affiliates — — 11 — — 11 Inventories — — 998 — — 998 Other current assets — — 1,242 687 — 1,929 Total current assets 1 3 6,133 954 — 7,091 Property and equipment, net (1) — — 22,061 314 — 22,375 Goodwill — — 1,683 218 — 1,901 Spectrum licenses — — 35,532 — — 35,532 Other intangible assets, net — — 169 91 — 260 Investments in subsidiaries, net 24,212 43,582 — — (67,794 ) — Intercompany receivables and note receivables — 7,188 — — (7,188 ) — Equipment installment plan receivables due after one year, net — — 1,222 — — 1,222 Other assets — 6 1,220 237 (152 ) 1,311 Total assets $ 24,213 $ 50,779 $ 68,020 $ 1,814 $ (75,134 ) $ 69,692 Liabilities and Stockholders' Equity Current liabilities Accounts payable and accrued liabilities $ — $ 232 $ 6,166 $ 288 $ — $ 6,686 Payables to affiliates — 158 32 — — 190 Short-term debt — 300 703 1 — 1,004 Short-term debt to affiliates — 320 — — — 320 Deferred revenue — — 722 — — 722 Other current liabilities — — 175 184 — 359 Total current liabilities — 1,010 7,798 473 — 9,281 Long-term debt — 10,947 1,118 — — 12,065 Long-term debt to affiliates — 14,581 — — — 14,581 Tower obligations (1) — — 389 2,185 — 2,574 Deferred tax liabilities — — 4,239 — (152 ) 4,087 Deferred rent expense — — 2,746 — — 2,746 Negative carrying value of subsidiaries, net — — 620 — (620 ) — Intercompany payables and debt 823 — 6,087 278 (7,188 ) — Other long-term liabilities — 29 919 20 — 968 Total long-term liabilities 823 25,557 16,118 2,483 (7,960 ) 37,021 Total stockholders' equity (deficit) 23,390 24,212 44,104 (1,142 ) (67,174 ) 23,390 Total liabilities and stockholders' equity $ 24,213 $ 50,779 $ 68,020 $ 1,814 $ (75,134 ) $ 69,692 (1) Assets and liabilities for Non-Guarantor Subsidiaries are primarily included in VIEs related to the 2012 Tower Transaction. See Note 8 – Tower Obligations included in our Annual Report on Form 10-K for the year ended December 31, 2017 for further information. Condensed Consolidating Balance Sheet Information December 31, 2017 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Assets Current assets Cash and cash equivalents $ 74 $ 1 $ 1,086 $ 58 $ — $ 1,219 Accounts receivable, net — — 1,659 256 — 1,915 Equipment installment plan receivables, net — — 2,290 — — 2,290 Accounts receivable from affiliates — — 22 — — 22 Inventories — — 1,566 — — 1,566 Other current assets — — 1,275 628 — 1,903 Total current assets 74 1 7,898 942 — 8,915 Property and equipment, net (1) — — 21,890 306 — 22,196 Goodwill — — 1,683 — — 1,683 Spectrum licenses — — 35,366 — — 35,366 Other intangible assets, net — — 217 — — 217 Investments in subsidiaries, net 22,534 40,988 — — (63,522 ) — Intercompany receivables and note receivables — 8,503 — — (8,503 ) — Equipment installment plan receivables due after one year, net — — 1,274 — — 1,274 Other assets — 2 814 236 (140 ) 912 Total assets $ 22,608 $ 49,494 $ 69,142 $ 1,484 $ (72,165 ) $ 70,563 Liabilities and Stockholders' Equity Current liabilities Accounts payable and accrued liabilities $ — $ 253 $ 8,014 $ 261 $ — $ 8,528 Payables to affiliates — 146 36 — — 182 Short-term debt — 999 613 — — 1,612 Deferred revenue — — 779 — — 779 Other current liabilities 17 — 192 205 — 414 Total current liabilities 17 1,398 9,634 466 — 11,515 Long-term debt — 10,911 1,210 — — 12,121 Long-term debt to affiliates — 14,586 — — — 14,586 Tower obligations (1) — — 392 2,198 — 2,590 Deferred tax liabilities — — 3,677 — (140 ) 3,537 Deferred rent expense — — 2,720 — — 2,720 Negative carrying value of subsidiaries, net — — 629 — (629 ) — Intercompany payables and debt 32 — 8,201 270 (8,503 ) — Other long-term liabilities — 65 866 4 — 935 Total long-term liabilities 32 25,562 17,695 2,472 (9,272 ) 36,489 Total stockholders' equity (deficit) 22,559 22,534 41,813 (1,454 ) (62,893 ) 22,559 Total liabilities and stockholders' equity $ 22,608 $ 49,494 $ 69,142 $ 1,484 $ (72,165 ) $ 70,563 (1) Assets and liabilities for Non-Guarantor Subsidiaries are primarily included in VIEs related to the 2012 Tower Transaction. See Note 8 – Tower Obligations included in our Annual Report on Form 10-K for the year ended December 31, 2017, for further information. |
Schedule of Condensed Consolidating Statement of Comprehensive Income Information | Condensed Consolidating Statement of Comprehensive Income Information Three Months Ended June 30, 2018 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Revenues Service revenues $ — $ — $ 7,609 $ 551 $ (229 ) $ 7,931 Equipment revenues — — 2,370 1 (46 ) 2,325 Other revenues — 2 267 55 (9 ) 315 Total revenues — 2 10,246 607 (284 ) 10,571 Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below — — 1,522 8 — 1,530 Cost of equipment sales — — 2,556 262 (46 ) 2,772 Selling, general and administrative — 6 3,201 216 (238 ) 3,185 Depreciation and amortization — — 1,611 23 — 1,634 Total operating expense — 6 8,890 509 (284 ) 9,121 Operating (loss) income — (4 ) 1,356 98 — 1,450 Other income (expense) Interest expense — (120 ) (28 ) (48 ) — (196 ) Interest expense to affiliates — (129 ) (4 ) — 5 (128 ) Interest income — 6 4 1 (5 ) 6 Other expense, net — (59 ) (5 ) — — (64 ) Total other expense, net — (302 ) (33 ) (47 ) — (382 ) Income (loss) before income taxes — (306 ) 1,323 51 — 1,068 Income tax expense — — (277 ) (9 ) — (286 ) Earnings of subsidiaries 782 1,088 23 — (1,893 ) — Net income $ 782 $ 782 $ 1,069 $ 42 $ (1,893 ) $ 782 Net income $ 782 $ 782 $ 1,069 $ 42 $ (1,893 ) $ 782 Other comprehensive income, net of tax Other comprehensive income, net of tax 3 3 3 — (6 ) 3 Total comprehensive income $ 785 $ 785 $ 1,072 $ 42 $ (1,899 ) $ 785 Condensed Consolidating Statement of Comprehensive Income Information Three Months Ended June 30, 2017 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Revenues Service revenues $ — $ — $ 7,127 $ 528 $ (210 ) $ 7,445 Equipment revenues — — 2,575 — (69 ) 2,506 Other revenues — — 216 51 (5 ) 262 Total revenues — — 9,918 579 (284 ) 10,213 Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below — — 1,512 6 — 1,518 Cost of equipment sales — — 2,664 251 (69 ) 2,846 Selling, general and administrative — — 2,933 197 (215 ) 2,915 Depreciation and amortization — — 1,501 18 — 1,519 Gains on disposal of spectrum licenses — — (1 ) — — (1 ) Total operating expense — — 8,609 472 (284 ) 8,797 Operating income — — 1,309 107 — 1,416 Other income (expense) Interest expense — (194 ) (23 ) (48 ) — (265 ) Interest expense to affiliates — (132 ) (5 ) — 6 (131 ) Interest income — 8 4 — (6 ) 6 Other expense, net — (91 ) (1 ) — — (92 ) Total other expense, net — (409 ) (25 ) (48 ) — (482 ) Income (loss) before income taxes — (409 ) 1,284 59 — 934 Income tax expense — — (333 ) (20 ) — (353 ) Earnings of subsidiaries 581 990 14 — (1,585 ) — Net income 581 581 965 39 (1,585 ) 581 Dividends on preferred stock (14 ) — — — — (14 ) Net income attributable to common stockholders $ 567 $ 581 $ 965 $ 39 $ (1,585 ) $ 567 Net income $ 581 $ 581 $ 965 $ 39 $ (1,585 ) $ 581 Other comprehensive income (loss), net of tax Other comprehensive income (loss), net of tax 1 1 1 (1 ) (1 ) 1 Total comprehensive income $ 582 $ 582 $ 966 $ 38 $ (1,586 ) $ 582 Condensed Consolidating Statement of Comprehensive Income Information Six Months Ended June 30, 2018 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Revenues Service revenues $ — $ — $ 15,096 $ 1,091 $ (450 ) $ 15,737 Equipment revenues — — 4,777 1 (100 ) 4,678 Other revenues — 3 516 110 (18 ) 611 Total revenues — 3 20,389 1,202 (568 ) 21,026 Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below — — 3,102 17 — 3,119 Cost of equipment sales — — 5,220 498 (101 ) 5,617 Selling, general and administrative — 6 6,358 452 (467 ) 6,349 Depreciation and amortization — — 3,165 44 — 3,209 Total operating expense — 6 17,845 1,011 (568 ) 18,294 Operating (loss) income — (3 ) 2,544 191 — 2,732 Other income (expense) Interest expense — (294 ) (57 ) (96 ) — (447 ) Interest expense to affiliates — (295 ) (9 ) — 10 (294 ) Interest income — 12 9 1 (10 ) 12 Other (expense) income, net — (91 ) 37 — — (54 ) Total other (expense) income, net — (668 ) (20 ) (95 ) — (783 ) Income (loss) before income taxes — (671 ) 2,524 96 — 1,949 Income tax expense — — (476 ) (20 ) — (496 ) Earnings of subsidiaries 1,453 2,124 17 — (3,594 ) — Net income $ 1,453 $ 1,453 $ 2,065 $ 76 $ (3,594 ) $ 1,453 Net income $ 1,453 $ 1,453 $ 2,065 $ 76 $ (3,594 ) $ 1,453 Other comprehensive income, net of tax Other comprehensive income, net of tax — — — — — — Total comprehensive income $ 1,453 $ 1,453 $ 2,065 $ 76 $ (3,594 ) $ 1,453 Condensed Consolidating Statement of Comprehensive Income Information Six Months Ended June 30, 2017 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Revenues Service revenues $ — $ — $ 14,145 $ 1,053 $ (424 ) $ 14,774 Equipment revenues — — 4,718 — (169 ) 4,549 Other revenues — — 410 103 (10 ) 503 Total revenues — — 19,273 1,156 (603 ) 19,826 Operating expenses Cost of services, exclusive of depreciation and amortization shown separately below — — 2,914 12 — 2,926 Cost of equipment sales — — 5,204 497 (169 ) 5,532 Selling, general and administrative — — 5,861 443 (434 ) 5,870 Depreciation and amortization — — 3,047 36 — 3,083 Gains on disposal of spectrum licenses — — (38 ) — — (38 ) Total operating expenses — — 16,988 988 (603 ) 17,373 Operating income — — 2,285 168 — 2,453 Other income (expense) Interest expense — (458 ) (50 ) (96 ) — (604 ) Interest expense to affiliates — (231 ) (12 ) — 12 (231 ) Interest income — 17 8 — (12 ) 13 Other income (expense), net — (88 ) (2 ) — — (90 ) Total other expense, net — (760 ) (56 ) (96 ) — (912 ) Income (loss) before income taxes — (760 ) 2,229 72 — 1,541 Income tax expense — — (237 ) (25 ) — (262 ) Earnings (loss) of subsidiaries 1,279 2,039 (17 ) — (3,301 ) — Net income 1,279 1,279 1,975 47 (3,301 ) 1,279 Dividends on preferred stock (28 ) — — — — (28 ) Net income attributable to common stockholders $ 1,251 $ 1,279 $ 1,975 $ 47 $ (3,301 ) $ 1,251 Net income $ 1,279 $ 1,279 $ 1,975 $ 47 $ (3,301 ) $ 1,279 Other comprehensive income, net of tax Other comprehensive income, net of tax 2 2 2 — (4 ) 2 Total comprehensive income $ 1,281 $ 1,281 $ 1,977 $ 47 $ (3,305 ) $ 1,281 |
Schedule of Condensed Consolidating Statement of Cash Flows Information | Condensed Consolidating Statement of Cash Flows Information Three Months Ended June 30, 2018 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Operating activities Net cash (used in) provided by operating activities $ (1 ) $ (258 ) $ 2,932 $ (1,282 ) $ (130 ) $ 1,261 Investing activities Purchases of property and equipment — — (1,624 ) (5 ) — (1,629 ) Purchases of spectrum licenses and other intangible assets — — (28 ) — — (28 ) Proceeds related to beneficial interests in securitization transactions — — 12 1,311 — 1,323 Acquisition of companies, net of cash acquired — — (5 ) — — (5 ) Equity investment in subsidiary — — (26 ) — 26 — Other, net — — 33 — — 33 Net cash (used in) provided by investing activities — — (1,638 ) 1,306 26 (306 ) Financing activities Proceeds from issuance of long-term debt — — — — — — Payments of consent fees related to long-term debt — — (38 ) — — (38 ) Proceeds from borrowing on revolving credit facility, net — 2,070 — — — 2,070 Repayments of revolving credit facility — — (2,195 ) — — (2,195 ) Repayments of capital lease obligations — — (154 ) (1 ) — (155 ) Repayments of long-term debt — — (2,350 ) — — (2,350 ) Repurchases of common stock (405 ) — — — — (405 ) Intercompany advances, net 405 (1,810 ) 1,406 (1 ) — — Equity investment from parent — — — 26 (26 ) — Tax withholdings on share-based awards — — (10 ) — — (10 ) Cash payments for debt prepayment or debt extinguishment costs — — (181 ) — — (181 ) Intercompany dividend paid — — — (130 ) 130 — Other, net 1 — (4 ) — — (3 ) Net cash provided by (used in) financing activities 1 260 (3,526 ) (106 ) 104 (3,267 ) Change in cash and cash equivalents — 2 (2,232 ) (82 ) — (2,312 ) Cash and cash equivalents Beginning of period 1 1 2,395 130 — 2,527 End of period $ 1 $ 3 $ 163 $ 48 $ — $ 215 Condensed Consolidating Statement of Cash Flows Information Three Months Ended June 30, 2017 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Operating activities Net cash provided by (used in) operating activities $ 1 $ (795 ) $ 2,816 $ (836 ) $ (80 ) $ 1,106 Investing activities Purchases of property and equipment — — (1,347 ) — — (1,347 ) Purchases of spectrum licenses and other intangible assets — — (5,791 ) — — (5,791 ) Proceeds related to beneficial interests in securitization transactions — — 11 871 — 882 Equity investment in subsidiary (308 ) — — — 308 — Other, net — — 5 — — 5 Net cash (used in) provided by investing activities (308 ) — (7,122 ) 871 308 (6,251 ) Financing activities Proceeds from issuance of long-term debt — 4,485 — — — 4,485 Proceeds from borrowing on revolving credit facility, net — 1,855 — — — 1,855 Repayments of revolving credit facility — — (1,175 ) — — (1,175 ) Repayments of capital lease obligations — — (119 ) — — (119 ) Repayments of short-term debt for purchases of inventory, property and equipment, net — — (292 ) — — (292 ) Repayments of long-term debt — — (6,750 ) — — (6,750 ) Intercompany advances, net — (8,990 ) 8,995 (5 ) — — Equity investment from parent — 308 — — (308 ) — Tax withholdings on share-based awards — — (3 ) — — (3 ) Intercompany dividend paid — — — (80 ) 80 — Dividends on preferred stock (14 ) — — — — (14 ) Cash payments for debt prepayment or debt extinguishment costs — — (159 ) — — (159 ) Other, net 4 — (7 ) — — (3 ) Net cash (used in) provided by financing activities (10 ) (2,342 ) 490 (85 ) (228 ) (2,175 ) Change in cash and cash equivalents (317 ) (3,137 ) (3,816 ) (50 ) — (7,320 ) Cash and cash equivalents Beginning of period 360 3,138 3,937 66 — 7,501 End of period $ 43 $ 1 $ 121 $ 16 $ — $ 181 Balances have been revised based on the guidance in ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” See Note 1 - Summary of Significant Accounting Policies of the Notes to the Condensed Consolidated Financial Statements, for further information. Condensed Consolidating Statement of Cash Flows Information Six Months Ended June 30, 2018 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Operating activities Net cash (used in) provided by operating activities $ — $ (662 ) $ 5,306 $ (2,483 ) $ (130 ) $ 2,031 Investing activities Purchases of property and equipment — — (2,990 ) (5 ) — (2,995 ) Purchases of spectrum licenses and other intangible assets — — (79 ) — — (79 ) Proceeds related to beneficial interests in securitization transactions — — 25 2,593 — 2,618 Acquisition of companies, net of cash acquired — — (338 ) — — (338 ) Equity investment in subsidiary — — (26 ) — 26 — Other, net — — 26 — — 26 Net cash (used in) provided by investing activities — — (3,382 ) 2,588 26 (768 ) Financing activities Proceeds from issuance of long-term debt — 2,494 — — — 2,494 Payments of consent fees related to long-term debt — — (38 ) — — (38 ) Proceeds from borrowing on revolving credit facility, net — 4,240 — — — 4,240 Repayments of revolving credit facility — — (3,920 ) — — (3,920 ) Repayments of capital lease obligations — — (326 ) (1 ) — (327 ) Repayments of long-term debt — — (3,349 ) — — (3,349 ) Repurchases of common stock (1,071 ) — — — — (1,071 ) Intercompany advances, net 995 (6,070 ) 5,085 (10 ) — — Equity investment from parent — — — 26 (26 ) — Tax withholdings on share-based awards — — (84 ) — — (84 ) Cash payments for debt prepayment or debt extinguishment costs — — (212 ) — — (212 ) Intercompany dividend paid — — — (130 ) 130 — Other, net 3 — (3 ) — — — Net cash (used in) provided by financing activities (73 ) 664 (2,847 ) (115 ) 104 (2,267 ) Change in cash and cash equivalents (73 ) 2 (923 ) (10 ) — (1,004 ) Cash and cash equivalents Beginning of period 74 1 1,086 58 — 1,219 End of period $ 1 $ 3 $ 163 $ 48 $ — $ 215 Condensed Consolidating Statement of Cash Flows Information Six Months Ended June 30, 2017 (in millions) Parent Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating and Eliminating Adjustments Consolidated Operating activities Net cash provided by (used in) operating activities $ 2 $ (929 ) $ 4,671 $ (1,950 ) $ (80 ) $ 1,714 Investing activities Purchases of property and equipment — — (2,875 ) — — (2,875 ) Purchases of spectrum licenses and other intangible assets — — (5,805 ) — — (5,805 ) Proceeds related to beneficial interests in securitization transactions — — 21 1,995 — 2,016 Equity investment in subsidiary (308 ) — — — 308 — Other, net — — (3 ) — — (3 ) Net cash (used in) provided by investing activities (308 ) — (8,662 ) 1,995 308 (6,667 ) Financing activities Proceeds from issuance of long-term debt — 9,980 — — — 9,980 Proceeds from borrowing on revolving credit facility, net — 1,855 — — — 1,855 Repayments of revolving credit facility — — (1,175 ) — — (1,175 ) Repayments of capital lease obligations — — (209 ) — — (209 ) Repayments of short-term debt for purchases of inventory, property and equipment, net — — (292 ) — — (292 ) Repayments of long-term debt — — (10,230 ) — — (10,230 ) Intercompany advances, net — (13,946 ) 13,962 (16 ) — — Equity investment from parent — 308 — — (308 ) — Tax withholdings on share-based awards — — (95 ) — — (95 ) Cash payments for debt prepayment or debt extinguishment costs — — (188 ) — — (188 ) Intercompany dividend paid — — — (80 ) 80 — Dividends on preferred stock (28 ) — — — — (28 ) Other, net 19 — (3 ) — — 16 Net cash (used in) provided by financing activities (9 ) (1,803 ) 1,770 (96 ) (228 ) (366 ) Change in cash and cash equivalents (315 ) (2,732 ) (2,221 ) (51 ) — (5,319 ) Cash and cash equivalents Beginning of period 358 2,733 2,342 67 — 5,500 End of period $ 43 $ 1 $ 121 $ 16 $ — $ 181 Balances have been revised based on the guidance in ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” See Note 1 - Summary of Significant Accounting Policies of the Notes to the Condensed Consolidated Financial Statements, for further information. |
Summary of Significant Accoun37
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jan. 01, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Net cash provided by (used in) operating activities | $ 1,261 | $ 1,106 | $ 2,031 | $ 1,714 | |
Net cash used in investing activities | (306) | (6,251) | (768) | (6,667) | |
Net cash (used in) provided by financing activities | (3,267) | (2,175) | (2,267) | (366) | |
Accounting Standards Update 2014-09 | Contract acquisition costs paid on open contracts | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Deferred contract cost asset | $ 150 | ||||
Accounting Standards Update 2014-09 | Contracts with promotional bill credits | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Deferred contract cost asset | $ 140 | ||||
Accounting Standards Update 2016-15 | Adjustments for New Accounting Principle, Early Adoption | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Net cash provided by (used in) operating activities | (1,300) | (882) | (2,600) | (2,000) | |
Net cash used in investing activities | 1,300 | 882 | 2,600 | 2,000 | |
Accounting Standards Update 2016-15 | Adjustment for Debt Prepayments and Debt Extinguishment Costs | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Net cash provided by (used in) operating activities | (181) | (159) | (212) | (188) | |
Net cash (used in) provided by financing activities | $ (181) | $ (159) | $ (212) | $ (188) |
Summary of Significant Accoun38
Summary of Significant Accounting Policies - Schedule of Cumulative Impact of Adoption (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Assets | |||
Other current assets | $ 1,929 | $ 2,043 | $ 1,903 |
Other assets | 1,311 | 1,062 | 912 |
Liabilities and Stockholders' Equity | |||
Deferred revenue | 722 | 783 | 779 |
Deferred tax liabilities | 4,087 | 3,610 | |
Accumulated deficit | (14,389) | (15,861) | $ (16,074) |
Calculated under Revenue Guidance in Effect before Topic 606 | |||
Assets | |||
Other current assets | 1,861 | 1,903 | |
Other assets | 901 | 912 | |
Liabilities and Stockholders' Equity | |||
Deferred revenue | 709 | 779 | |
Deferred tax liabilities | 3,968 | 3,537 | |
Accumulated deficit | (14,735) | (16,074) | |
Difference between Revenue Guidance in Effect before and after Topic 606 | Accounting Standards Update 2014-09 | |||
Assets | |||
Other current assets | 68 | 140 | |
Other assets | 410 | 150 | |
Liabilities and Stockholders' Equity | |||
Deferred revenue | 13 | 4 | |
Deferred tax liabilities | 119 | 73 | |
Accumulated deficit | $ 346 | $ 213 |
Summary of Significant Accoun39
Summary of Significant Accounting Policies - Schedule of Impact of Adoption on Condensed Consolidated Financial Statements (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jan. 01, 2018 | Dec. 31, 2017 | |
Revenues | ||||||
Branded postpaid revenues | $ 5,164 | $ 4,820 | $ 10,234 | $ 9,545 | ||
Branded prepaid revenues | 2,402 | 2,334 | 4,804 | 4,633 | ||
Wholesale revenues | 275 | 234 | 541 | 504 | ||
Roaming and other service revenues | 90 | 57 | 158 | 92 | ||
Total service revenues | 7,931 | 7,445 | 15,737 | 14,774 | ||
Equipment revenues | 2,325 | 2,506 | 4,678 | 4,549 | ||
Other revenues | 315 | 262 | 611 | 503 | ||
Total revenues | 10,571 | 10,213 | 21,026 | 19,826 | ||
Operating expenses | ||||||
Cost of services, exclusive of depreciation and amortization shown separately below | 1,530 | 1,518 | 3,119 | 2,926 | ||
Cost of equipment sales | 2,772 | 2,846 | 5,617 | 5,532 | ||
Selling, general and administrative | 3,185 | 2,915 | 6,349 | 5,870 | ||
Depreciation and amortization | 1,634 | 1,519 | 3,209 | 3,083 | ||
Total operating expenses | 9,121 | 8,797 | 18,294 | 17,373 | ||
Operating income | 1,450 | 1,416 | 2,732 | 2,453 | ||
Total other expense, net | (382) | (482) | (783) | (912) | ||
Income before income taxes | 1,068 | 934 | 1,949 | 1,541 | ||
Income tax expense | (286) | (353) | (496) | (262) | ||
Net income | $ 782 | $ 581 | $ 1,453 | $ 1,279 | ||
Earnings per share | ||||||
Basic (in USD per share) | $ 0.92 | $ 0.68 | $ 1.71 | $ 1.51 | ||
Diluted (in USD per share) | $ 0.92 | $ 0.67 | $ 1.69 | $ 1.47 | ||
Assets | ||||||
Other current assets | $ 1,929 | $ 1,929 | $ 2,043 | $ 1,903 | ||
Other assets | 1,311 | 1,311 | 1,062 | 912 | ||
Liabilities and Stockholders' Equity | ||||||
Deferred revenue | 722 | 722 | 783 | 779 | ||
Deferred tax liabilities | 4,087 | 4,087 | 3,610 | |||
Accumulated deficit | (14,389) | (14,389) | (15,861) | $ (16,074) | ||
Calculated under Revenue Guidance in Effect before Topic 606 | ||||||
Revenues | ||||||
Branded postpaid revenues | 5,162 | 10,261 | ||||
Branded prepaid revenues | 2,404 | 4,807 | ||||
Wholesale revenues | 275 | 541 | ||||
Roaming and other service revenues | 90 | 158 | ||||
Total service revenues | 7,931 | 15,767 | ||||
Equipment revenues | 2,229 | 4,505 | ||||
Other revenues | 315 | 611 | ||||
Total revenues | 10,475 | 20,883 | ||||
Operating expenses | ||||||
Cost of services, exclusive of depreciation and amortization shown separately below | 1,504 | 3,093 | ||||
Cost of equipment sales | 2,779 | 5,624 | ||||
Selling, general and administrative | 3,192 | 6,404 | ||||
Depreciation and amortization | 1,634 | 3,209 | ||||
Total operating expenses | 9,109 | 18,330 | ||||
Operating income | 1,366 | 2,553 | ||||
Total other expense, net | (382) | (783) | ||||
Income before income taxes | 984 | 1,770 | ||||
Income tax expense | (264) | (450) | ||||
Net income | $ 720 | $ 1,320 | ||||
Earnings per share | ||||||
Basic (in USD per share) | $ 0.85 | $ 1.55 | ||||
Diluted (in USD per share) | $ 0.85 | $ 1.54 | ||||
Assets | ||||||
Other current assets | $ 1,861 | $ 1,861 | 1,903 | |||
Other assets | 901 | 901 | 912 | |||
Liabilities and Stockholders' Equity | ||||||
Deferred revenue | 709 | 709 | 779 | |||
Deferred tax liabilities | 3,968 | 3,968 | 3,537 | |||
Accumulated deficit | (14,735) | (14,735) | (16,074) | |||
Difference between Revenue Guidance in Effect before and after Topic 606 | Accounting Standards Update 2014-09 | ||||||
Revenues | ||||||
Branded postpaid revenues | 2 | (27) | ||||
Branded prepaid revenues | (2) | (3) | ||||
Wholesale revenues | 0 | 0 | ||||
Roaming and other service revenues | 0 | 0 | ||||
Total service revenues | 0 | (30) | ||||
Equipment revenues | 96 | 173 | ||||
Other revenues | 0 | 0 | ||||
Total revenues | 96 | 143 | ||||
Operating expenses | ||||||
Cost of services, exclusive of depreciation and amortization shown separately below | 26 | 26 | ||||
Cost of equipment sales | (7) | (7) | ||||
Selling, general and administrative | (7) | (55) | ||||
Depreciation and amortization | 0 | 0 | ||||
Total operating expenses | 12 | (36) | ||||
Operating income | 84 | 179 | ||||
Total other expense, net | 0 | 0 | ||||
Income before income taxes | 84 | 179 | ||||
Income tax expense | (22) | (46) | ||||
Net income | $ 62 | $ 133 | ||||
Earnings per share | ||||||
Basic (in USD per share) | $ 0.07 | $ 0.16 | ||||
Diluted (in USD per share) | $ 0.07 | $ 0.15 | ||||
Assets | ||||||
Other current assets | $ 68 | $ 68 | 140 | |||
Other assets | 410 | 410 | 150 | |||
Liabilities and Stockholders' Equity | ||||||
Deferred revenue | 13 | 13 | 4 | |||
Deferred tax liabilities | 119 | 119 | 73 | |||
Accumulated deficit | $ 346 | $ 346 | $ 213 |
Significant Transactions - Narr
Significant Transactions - Narrative (Details) - USD ($) $ in Millions | Jan. 22, 2018 | Jan. 01, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 |
Significant Transactions [Line Items] | |||||||
Cost of services | $ 1,530 | $ 1,518 | $ 3,119 | $ 2,926 | |||
Gross | |||||||
Significant Transactions [Line Items] | |||||||
Cost of services | 0 | $ 36 | $ 36 | ||||
Hurricane | |||||||
Significant Transactions [Line Items] | |||||||
Reimbursement from insurance carriers | $ 70 | $ 94 | |||||
Iowa Wireless | |||||||
Significant Transactions [Line Items] | |||||||
Unconsolidated subsidiary ownership percentage | 54.00% | ||||||
Purchase price of unconsolidated subsidiary | $ 25 | ||||||
Cash consideration | $ 25 | ||||||
Layer3 TV | |||||||
Significant Transactions [Line Items] | |||||||
Cash consideration | $ 318 |
Significant Transactions - Sche
Significant Transactions - Schedule of Hurricane Impacts (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||||
Cost of services | $ 1,530 | $ 1,518 | $ 3,119 | $ 2,926 | |
Total operating expenses | 9,121 | 8,797 | 18,294 | 17,373 | |
Operating income (loss) | 1,450 | 1,416 | 2,732 | 2,453 | |
Net income | $ 782 | $ 581 | $ 1,453 | $ 1,279 | |
Earnings per share - basic (in USD per share) | $ 0.92 | $ 0.68 | $ 1.71 | $ 1.51 | |
Earnings per share - diluted (in USD per share) | $ 0.92 | $ 0.67 | $ 1.69 | $ 1.47 | |
Gross | |||||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||||
Cost of services | $ 0 | $ 36 | $ 36 | ||
Total operating expenses | 0 | 36 | |||
Operating income (loss) | 0 | (36) | |||
Net income | $ 0 | $ (23) | |||
Earnings per share - basic (in USD per share) | $ 0 | $ (0.03) | |||
Earnings per share - diluted (in USD per share) | $ 0 | $ (0.03) | |||
Reimbursement | |||||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||||
Cost of services | $ (70) | $ (70) | |||
Total operating expenses | (70) | (70) | |||
Operating income (loss) | 70 | 70 | |||
Net income | $ 45 | $ 45 | |||
Earnings per share - basic (in USD per share) | $ 0.06 | $ 0.06 | |||
Earnings per share - diluted (in USD per share) | $ 0.06 | $ 0.06 | |||
Net | |||||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||||
Cost of services | $ (70) | $ (34) | |||
Total operating expenses | (70) | (34) | |||
Operating income (loss) | 70 | 34 | |||
Net income | $ 45 | $ 22 | |||
Earnings per share - basic (in USD per share) | $ 0.06 | $ 0.03 | |||
Earnings per share - diluted (in USD per share) | $ 0.06 | $ 0.03 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) - USD ($) | May 18, 2018 | Apr. 29, 2018 | Jan. 22, 2018 | Jan. 01, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 06, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | ||||||||||
Payments of consent fees | $ 38,000,000 | $ 0 | $ 38,000,000 | $ 0 | ||||||
Payments for third party bank fees | 3,185,000,000 | $ 2,915,000,000 | 6,349,000,000 | $ 5,870,000,000 | ||||||
Goodwill | 1,901,000,000 | 1,901,000,000 | $ 1,683,000,000 | |||||||
Sprint | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Exchange ratio | 0.10256 | |||||||||
Exchange ratio (in shares) | 9.75 | |||||||||
Fully-diluted shares of combined company held by public stockholders (percent) | 30.90% | |||||||||
Payments of consent fees | 31,000,000 | |||||||||
Required reimbursement by acquiree upon termination, percentage | 33.00% | |||||||||
Upfront payments to third party note holders by acquiree | 241,000,000 | |||||||||
Required reimbursement by acquirer upon termination, percentage | 67.00% | |||||||||
Required reimbursement by acquirer upon termination | $ 161,000,000 | |||||||||
Costs recognized associated with merger transaction | 41,000,000 | 41,000,000 | ||||||||
Required payment resulting from failure to satisfy closing condition of business combination agreement (up to) | $ 600,000,000 | |||||||||
Sprint | Senior Notes | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Payments of consent fees | $ 14,000,000 | 17,000,000 | ||||||||
Payments for third party bank fees | 6,000,000 | |||||||||
Sprint | Secured and Unsecured Debt Financing | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Financing commitment, amount | $ 38,000,000,000 | 30,000,000,000 | $ 30,000,000,000 | |||||||
Reduction of initial aggregate commitment under Commitment Letter | $ (8,000,000,000) | |||||||||
Sprint | Existing Sprint Spectrum Notes | Senior Notes | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Payments of consent fees | 14,000,000 | |||||||||
Sprint | Deutsche Telekom AG | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Fully-diluted shares expected to be held immediately following merger (percent) | 41.70% | |||||||||
Sprint | SoftBank | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Fully-diluted shares expected to be held immediately following merger (percent) | 27.40% | |||||||||
Layer3 TV | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration | $ 318,000,000 | |||||||||
Payment included in consideration after closing of transaction | 5,000,000 | |||||||||
Grant-date fair value of cash-based and share-based incentive compensation awards | 37,000,000 | |||||||||
Liability recognized | 21,000,000 | |||||||||
Indemnification assets | 12,000,000 | |||||||||
Maximum amount that would be received under the indemnification asset | 12,000,000 | |||||||||
Goodwill | 218,000,000 | |||||||||
Intangible assets | $ 100,000,000 | |||||||||
Layer3 TV | Developed Technology | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Estimated useful life (in years) | 5 years | |||||||||
Intangible assets | $ 100,000,000 | |||||||||
Iowa Wireless | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration | $ 25,000,000 | |||||||||
Purchase price of unconsolidated subsidiary | 25,000,000 | |||||||||
Fair value of equity interest held | 56,000,000 | |||||||||
Gain on remeasurement of equity interest | 15,000,000 | |||||||||
Bargain purchase gain | $ 25,000,000 | |||||||||
Unconsolidated subsidiary ownership percentage | 54.00% | |||||||||
Deutsche Telekom AG | Sprint | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Payments of consent fees | $ 7,000,000 |
Business Combinations - Schedul
Business Combinations - Schedule of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jan. 22, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Assets acquired | ||||
Goodwill | $ 1,901 | $ 1,683 | ||
Iowa Wireless | ||||
Assets acquired | ||||
Cash and cash equivalents | $ 3 | |||
Accounts receivable, net | 6 | |||
Equipment installment plan receivables, net | 3 | |||
Inventories | 1 | |||
Other current assets | 2 | |||
Total current assets | 15 | |||
Property and equipment, net | 36 | |||
Spectrum licenses | $ 87 | 87 | ||
Total assets acquired | 138 | |||
Liabilities assumed | ||||
Accounts payable and accrued liabilities | 6 | |||
Deferred revenue | 2 | |||
Total current liabilities | 8 | |||
Deferred tax liabilities | 17 | |||
Other long-term liabilities | 7 | |||
Total long-term liabilities | 24 | |||
Total consideration transferred | $ 106 | |||
Layer3 TV | ||||
Assets acquired | ||||
Cash and cash equivalents | $ 2 | |||
Other current assets | 14 | |||
Property and equipment, net | 11 | |||
Intangible assets | 100 | |||
Goodwill | 218 | |||
Deferred tax assets | 2 | |||
Total assets acquired | 347 | |||
Liabilities assumed | ||||
Accounts payable and accrued liabilities | 27 | |||
Short-term debt | 2 | |||
Total liabilities assumed | 29 | |||
Total consideration transferred | $ 318 |
Business Combinations - Conside
Business Combinations - Consideration Transferred - Iowa Wireless (Details) - Iowa Wireless $ in Millions | Jan. 01, 2018USD ($) |
Business Acquisition [Line Items] | |
Cash paid | $ 25 |
Acquisition date fair value of previously held equity interest | 56 |
Bargain purchase gain | 25 |
Net assets acquired | $ 106 |
Receivables and Allowance for45
Receivables and Allowance for Credit Losses - EIP Receivables (Details) $ in Millions | 6 Months Ended | |
Jun. 30, 2018USD ($)classessegments | Dec. 31, 2017USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Portfolio segments | segments | 2 | |
Customer classes | classes | 2 | |
EIP receivables, gross | $ 3,914 | $ 3,960 |
Unamortized imputed discount | (268) | (264) |
EIP receivables, net of unamortized imputed discount | 3,646 | 3,696 |
Allowance for credit losses | (116) | (132) |
Equipment installment plan receivables, net | 3,530 | 3,564 |
Equipment installment plan receivables, net | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment installment plan receivables, net | 2,308 | 2,290 |
Equipment installment plan receivables due after one year, net | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment installment plan receivables, net | $ 1,222 | $ 1,274 |
Receivables and Allowance for46
Receivables and Allowance for Credit Losses - Unamortized Imputed Discount and Allowance for Credit Losses (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Allowance for credit losses and imputed discount, beginning of period | $ 482 | $ 418 | $ 418 |
Bad debt expense | 128 | 175 | |
Write-offs, net of recoveries | (160) | (212) | |
Change in imputed discount on short-term and long-term EIP receivables | 102 | 121 | |
Impact on the imputed discount from sales of EIP receivables | (98) | (85) | |
Allowance for credit losses and imputed discount, end of period | 454 | 417 | 482 |
Accounts Receivable Allowance | |||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Allowance for credit losses and imputed discount, beginning of period | 86 | 102 | 102 |
Bad debt expense | 25 | 56 | |
Write-offs, net of recoveries | (41) | (75) | |
Allowance for credit losses and imputed discount, end of period | $ 70 | 83 | $ 86 |
EIP Receivables Allowance | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Weighted average effective imputed interest rate | 10.10% | 9.60% | |
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Allowance for credit losses and imputed discount, beginning of period | $ 396 | 316 | $ 316 |
Bad debt expense | 103 | 119 | |
Write-offs, net of recoveries | (119) | (137) | |
Change in imputed discount on short-term and long-term EIP receivables | 102 | 121 | |
Impact on the imputed discount from sales of EIP receivables | (98) | (85) | |
Allowance for credit losses and imputed discount, end of period | $ 384 | $ 334 | $ 396 |
Receivables and Allowance for47
Receivables and Allowance for Credit Losses - Gross EIP Receivables by Credit Category (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | $ 3,914 | $ 3,960 |
Prime | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 1,653 | 1,758 |
Subprime | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 2,261 | 2,202 |
Current - 30 days past due | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 3,834 | 3,860 |
Current - 30 days past due | Prime | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 1,630 | 1,727 |
Current - 30 days past due | Subprime | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 2,204 | 2,133 |
31 - 60 days past due | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 39 | 46 |
31 - 60 days past due | Prime | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 12 | 17 |
31 - 60 days past due | Subprime | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 27 | 29 |
61 - 90 days past due | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 19 | 22 |
61 - 90 days past due | Prime | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 5 | 6 |
61 - 90 days past due | Subprime | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 14 | 16 |
More than 90 days past due | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 22 | 32 |
More than 90 days past due | Prime | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | 6 | 8 |
More than 90 days past due | Subprime | ||
Financing Receivable, Recorded Investment [Line Items] | ||
EIP receivables, gross | $ 16 | $ 24 |
Sales of Certain Receivables -
Sales of Certain Receivables - Sales of Service Receivables (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Nov. 30, 2016 |
Variable Interest Entity [Line Items] | ||||
Other current assets | $ 1,929 | $ 2,043 | $ 1,903 | |
Accounts payable and accrued liabilities | 6,686 | 8,528 | ||
Other current liabilities | 359 | 414 | ||
Factoring Arrangement | Variable Interest Entity, Not Primary Beneficiary | ||||
Variable Interest Entity [Line Items] | ||||
Revolving receivables facility, maximum borrowing capacity | $ 950 | |||
Revolving receivables facility, outstanding borrowings | 818 | 880 | ||
Other current assets | 287 | 236 | ||
Accounts payable and accrued liabilities | 10 | 25 | ||
Other current liabilities | $ 159 | $ 180 |
Sales of Certain Receivables 49
Sales of Certain Receivables - Sales of EIP Receivables (Details) - USD ($) $ in Millions | 6 Months Ended | |||
Jun. 30, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Aug. 31, 2017 | |
Variable Interest Entity [Line Items] | ||||
Other current assets | $ 1,929 | $ 2,043 | $ 1,903 | |
Other assets | 1,311 | $ 1,062 | 912 | |
EIP Securitization Arrangement | ||||
Variable Interest Entity [Line Items] | ||||
Revolving receivables facility, maximum borrowing capacity | 1,300 | $ 1,200 | ||
Revolving receivables facility, outstanding borrowings | $ 1,300 | 1,300 | ||
Equipment installment plan, maximum payment term | 24 months | |||
Other current assets | $ 394 | 403 | ||
Other assets | 99 | 109 | ||
Other long-term liabilities | $ 20 | $ 3 |
Sales of Certain Receivables 50
Sales of Certain Receivables - Sales of Receivables and Continuing Involvement (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Jan. 01, 2018 | |
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||||||
Other current assets | $ 1,929 | $ 1,929 | $ 1,903 | $ 2,043 | ||
Other long-term assets | 1,311 | 1,311 | 912 | $ 1,062 | ||
Accounts payable and accrued liabilities | 6,686 | 6,686 | 8,528 | |||
Other current liabilities | 359 | 359 | 414 | |||
Other long-term liabilities | 968 | 968 | 935 | |||
Of which: | ||||||
Losses from sales of receivables | 27 | $ 80 | 79 | $ 175 | ||
Factoring and EIP Securitization Arrangement | Transferor's Continuing Involvement in Transferred Financial Assets, Transfer Description | ||||||
Of which: | ||||||
Maximum exposure to loss, Factoring VIE | 1,300 | 1,300 | ||||
Factoring and EIP Securitization Arrangement | ||||||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||||||
Derecognized net service receivables and EIP receivables | 2,679 | 2,679 | 2,725 | |||
Other current assets | 681 | 681 | 639 | |||
Deferred purchase price assets | 778 | 778 | 745 | |||
Other long-term assets | 99 | 99 | 109 | |||
Accounts payable and accrued liabilities | 10 | 10 | 25 | |||
Other current liabilities | 159 | 159 | 180 | |||
Other long-term liabilities | 20 | 20 | 3 | |||
Net cash proceeds since inception | 1,933 | 2,058 | ||||
Of which: | ||||||
Change in net cash proceeds during the year-to-date period | (125) | 28 | ||||
Net cash proceeds funded by reinvested collections | 2,058 | 2,030 | ||||
Losses from sales of receivables | 28 | $ 80 | 80 | $ 175 | ||
Factoring and EIP Securitization Arrangement | Other current assets - of which, deferred purchase price | ||||||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||||||
Deferred purchase price assets | 679 | 679 | 636 | |||
Factoring and EIP Securitization Arrangement | Other long-term assets - of which, deferred purchase price | ||||||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||||||
Deferred purchase price assets | $ 99 | $ 99 | $ 109 |
Goodwill - Schedule of Changes
Goodwill - Schedule of Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | |
Goodwill [Roll Forward] | ||
Historical goodwill | $ 12,449 | |
Accumulated impairment losses at December 31, 2017 | $ (10,766) | |
Balance as of December 31, 2017 | 1,683 | |
Goodwill from acquisition of Layer3 TV | 218 | |
Balance as of March 31, 2018 | 1,901 | |
Accumulated impairment losses at June 30, 2018 | $ (10,766) |
Goodwill - Narrative (Details)
Goodwill - Narrative (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jan. 22, 2018 | Dec. 31, 2017 |
Goodwill [Line Items] | |||
Goodwill | $ 1,901 | $ 1,683 | |
Layer3 TV | |||
Goodwill [Line Items] | |||
Goodwill | $ 218 |
Spectrum License Transactions -
Spectrum License Transactions - Schedule of Spectrum License Activity (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jan. 01, 2018 | |
Indefinite-lived Intangible Assets [Roll Forward] | |||||
Purchase of spectrum licenses | $ 28,000,000 | $ 5,791,000,000 | $ 79,000,000 | $ 5,805,000,000 | |
Gains or losses recognized on spectrum license purchase | 0 | $ 1,000,000 | 0 | $ 38,000,000 | |
Iowa Wireless | |||||
Indefinite-lived Intangible Assets [Roll Forward] | |||||
Spectrum licenses | 87,000,000 | 87,000,000 | $ 87,000,000 | ||
Licensing Agreements | |||||
Indefinite-lived Intangible Assets [Roll Forward] | |||||
December 31, 2017 | 35,366,000,000 | ||||
Spectrum license acquisitions | 136,000,000 | ||||
Costs to clear spectrum | 30,000,000 | ||||
June 30, 2018 | $ 35,532,000,000 | 35,532,000,000 | |||
Purchase of spectrum licenses | 49,000,000 | ||||
Gains or losses recognized on spectrum license purchase | $ 0 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Short-term Investments and Long-term Debt (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Level 1 | Reported Value Measurement | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | $ 10,947 | $ 11,910 |
Level 1 | Fair Value | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 11,159 | 12,540 |
Level 2 | Reported Value Measurement | Secured Term Loan [$4.0B] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Term loans | 4,000 | 4,000 |
Level 2 | Reported Value Measurement | Affiliated Entity | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 598 | 3,100 |
Level 2 | Reported Value Measurement | Senior Notes | Affiliated Entity | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 9,983 | 7,486 |
Level 2 | Fair Value | Secured Term Loan [$4.0B] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Term loans | 3,973 | 4,020 |
Level 2 | Fair Value | Affiliated Entity | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 658 | 3,260 |
Level 2 | Fair Value | Senior Notes | Affiliated Entity | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 10,015 | 7,852 |
Level 3 | Reported Value Measurement | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Deferred purchase price assets | 778 | 745 |
Level 3 | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Deferred purchase price assets | $ 778 | $ 745 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) | May 18, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Apr. 30, 2018 | Apr. 28, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||||||||
Long-term debt, beginning balance | $ 12,121,000,000 | |||||||
Short-term debt to affiliates, beginning balance | 0 | |||||||
Total debt, beginning balance | 28,319,000,000 | |||||||
Issuances and Borrowings | $ 2,070,000,000 | $ 1,855,000,000 | 4,240,000,000 | $ 1,855,000,000 | ||||
Issuances and Borrowings | 2,494,000,000 | |||||||
Issuances and Borrowings | 6,734,000,000 | |||||||
Note Redemptions | (3,424,000,000) | (3,424,000,000) | ||||||
Repayments | 0 | (292,000,000) | 0 | (292,000,000) | ||||
Repayments | (2,350,000,000) | (6,750,000,000) | (3,349,000,000) | (10,230,000,000) | ||||
Repayments | (3,920,000,000) | |||||||
Reclassifications | 0 | |||||||
Consent Fees | (38,000,000) | 0 | (38,000,000) | 0 | ||||
Other | 299,000,000 | |||||||
Other | 300,000,000 | |||||||
Long-term debt, ending balance | 12,065,000,000 | 12,065,000,000 | ||||||
Short-term debt to affiliates, ending balance | 320,000,000 | 320,000,000 | ||||||
Total debt, ending balance | 27,970,000,000 | 27,970,000,000 | ||||||
Issuance of short-term debt for financing of property and equipment | 54,000,000 | $ 2,000,000 | 291,000,000 | $ 290,000,000 | ||||
Capital leases outstanding | 1,800,000,000 | 1,800,000,000 | $ 1,800,000,000 | |||||
Principal Issuances | $ 2,500,000,000 | $ 2,500,000,000 | ||||||
Senior Reset Notes | 8.097% Senior Reset Notes to affiliates due 2021 | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 8.097% | 8.097% | ||||||
Senior Reset Notes | 8.195% Senior Reset Notes to affiliates due 2022 | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 8.195% | 8.195% | ||||||
Third Party | ||||||||
Debt Instrument [Line Items] | ||||||||
Total debt to third parties, beginning balance | $ 13,733,000,000 | |||||||
Issuances and Borrowings | 2,494,000,000 | |||||||
Note Redemptions | $ (3,424,000,000) | (3,424,000,000) | ||||||
Repayments | 0 | |||||||
Reclassifications | 0 | |||||||
Consent Fees | (31,000,000) | |||||||
Other | 297,000,000 | |||||||
Total debt to third parties, ending balance | 13,069,000,000 | 13,069,000,000 | ||||||
Sprint | ||||||||
Debt Instrument [Line Items] | ||||||||
Consent Fees | (31,000,000) | |||||||
Sprint | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Consent Fees | $ (14,000,000) | (17,000,000) | ||||||
Sprint | Deutsche Telekom AG | ||||||||
Debt Instrument [Line Items] | ||||||||
Consent Fees | (7,000,000) | |||||||
Affiliated Entity | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt to affiliates, beginning balance | 14,586,000,000 | |||||||
Issuances and Borrowings | 4,240,000,000 | |||||||
Note Redemptions | 0 | 0 | ||||||
Repayments | (3,920,000,000) | |||||||
Reclassifications | 0 | |||||||
Consent Fees | (7,000,000) | |||||||
Other | 2,000,000 | |||||||
Long-term debt to affiliates, ending balance | 14,901,000,000 | 14,901,000,000 | ||||||
Affiliated Entity | Deutsche Telekom AG | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal Issuances | 2,500,000,000 | 2,500,000,000 | $ 2,500,000,000 | |||||
Affiliated Entity | Deutsche Telekom AG | Senior Reset Notes | 8.097% Senior Reset Notes to affiliates due 2021 | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal Issuances | $ 1,250,000,000 | $ 1,250,000,000 | ||||||
Interest rate, stated percentage | 8.097% | |||||||
Affiliated Entity | Deutsche Telekom AG | Senior Reset Notes | 8.195% Senior Reset Notes to affiliates due 2022 | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal Issuances | $ 1,250,000,000 | $ 1,250,000,000 | ||||||
Interest rate, stated percentage | 8.195% | |||||||
Short-term Debt | Third Party | ||||||||
Debt Instrument [Line Items] | ||||||||
Short-term debt, beginning balance | 1,612,000,000 | |||||||
Issuances and Borrowings | 0 | |||||||
Note Redemptions | (3,424,000,000) | (3,424,000,000) | ||||||
Repayments | 0 | |||||||
Reclassifications | 2,425,000,000 | |||||||
Consent Fees | 0 | |||||||
Other | 391,000,000 | |||||||
Short-term debt, ending balance | 1,004,000,000 | 1,004,000,000 | ||||||
Short-term Debt | Affiliated Entity | ||||||||
Debt Instrument [Line Items] | ||||||||
Short-term debt to affiliates, beginning balance | 0 | |||||||
Issuances and Borrowings | 4,240,000,000 | |||||||
Note Redemptions | 0 | 0 | ||||||
Repayments | (3,920,000,000) | |||||||
Reclassifications | 0 | |||||||
Consent Fees | 0 | |||||||
Other | 0 | |||||||
Short-term debt to affiliates, ending balance | 320,000,000 | 320,000,000 | ||||||
Long-term Debt | Third Party | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, beginning balance | 12,121,000,000 | |||||||
Issuances and Borrowings | 2,494,000,000 | |||||||
Note Redemptions | 0 | 0 | ||||||
Repayments | 0 | |||||||
Reclassifications | (2,425,000,000) | |||||||
Consent Fees | (31,000,000) | |||||||
Other | (94,000,000) | |||||||
Long-term debt, ending balance | 12,065,000,000 | 12,065,000,000 | ||||||
Long-term Debt | Affiliated Entity | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt to affiliates, beginning balance | 14,586,000,000 | |||||||
Issuances and Borrowings | 0 | |||||||
Note Redemptions | 0 | 0 | ||||||
Repayments | 0 | |||||||
Reclassifications | 0 | |||||||
Consent Fees | (7,000,000) | |||||||
Other | 2,000,000 | |||||||
Long-term debt to affiliates, ending balance | $ 14,581,000,000 | $ 14,581,000,000 |
Debt - Debt to Third Parties -
Debt - Debt to Third Parties - Issuances and Borrowings (Details) - USD ($) | Apr. 01, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Apr. 30, 2018 | Apr. 28, 2018 | Jan. 31, 2018 |
Debt Instrument [Line Items] | ||||||||
Principal Issuances | $ 2,500,000,000 | $ 2,500,000,000 | ||||||
Issuance Costs | 6,000,000 | 6,000,000 | ||||||
Net Proceeds from Issuance of Long-Term Debt | 2,494,000,000 | |||||||
Proceeds from issuance of long-term debt | 0 | $ 4,485,000,000 | 2,494,000,000 | $ 9,980,000,000 | ||||
4.500% Senior Notes due 2026 | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal Issuances | 1,000,000,000 | 1,000,000,000 | ||||||
Issuance Costs | $ 2,000,000 | 2,000,000 | ||||||
Net Proceeds from Issuance of Long-Term Debt | $ 998,000,000 | |||||||
Interest rate, stated percentage | 4.50% | 4.50% | ||||||
4.500% Senior Notes due 2026 | Issuer | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal Issuances | $ 1,000,000,000 | |||||||
Interest rate, stated percentage | 4.50% | 4.50% | ||||||
4.750% Senior Notes due 2028 | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal Issuances | $ 1,500,000,000 | $ 1,500,000,000 | ||||||
Issuance Costs | $ 4,000,000 | 4,000,000 | ||||||
Net Proceeds from Issuance of Long-Term Debt | $ 1,496,000,000 | |||||||
Interest rate, stated percentage | 4.75% | 4.75% | ||||||
4.750% Senior Notes due 2028 | Issuer | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal Issuances | $ 1,500,000,000 | |||||||
Interest rate, stated percentage | 4.75% | 4.75% | ||||||
4.500% Senior Notes due 2026 and 4.750% Senior Notes due 2028 | Issuer | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from issuance of long-term debt | $ 2,494,000,000 | |||||||
6.625% Senior Notes due 2023 | Issuer | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal Issuances | $ 1,750,000,000 | |||||||
Interest rate, stated percentage | 6.625% | |||||||
6.836% Senior Notes due 2023 | Issuer | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal Issuances | $ 600,000,000 | |||||||
Interest rate, stated percentage | 6.836% |
Debt - Debt to Third Parties 57
Debt - Debt to Third Parties - Notes Redemption (Details) - USD ($) | Apr. 28, 2018 | Apr. 01, 2018 | Jan. 15, 2018 | Jun. 30, 2018 | Jan. 31, 2018 |
Debt Instrument [Line Items] | |||||
Principal Amount | $ 3,424,000,000 | ||||
6.125% Senior Notes due 2022 | |||||
Debt Instrument [Line Items] | |||||
Redemption price (as a percent) | 103.063% | ||||
6.625% Senior Notes due 2023 | |||||
Debt Instrument [Line Items] | |||||
Redemption price (as a percent) | 103.313% | ||||
6.836% Senior Notes due 2023 | |||||
Debt Instrument [Line Items] | |||||
Redemption price (as a percent) | 103.418% | ||||
Senior Notes | 6.125% Senior Notes due 2022 | |||||
Debt Instrument [Line Items] | |||||
Principal Amount | 1,000,000,000 | $ 1,000,000,000 | |||
Write-off of Premiums, Discounts and Issuance Costs | 1,000,000 | ||||
Call Penalties | $ 31,000,000 | ||||
Interest rate, stated percentage | 6.125% | 6.125% | |||
Senior Notes | 6.625% Senior Notes due 2023 | |||||
Debt Instrument [Line Items] | |||||
Principal Amount | $ 1,750,000,000 | ||||
Write-off of Premiums, Discounts and Issuance Costs | (75,000,000) | ||||
Call Penalties | $ 58,000,000 | ||||
Interest rate, stated percentage | 6.625% | ||||
Senior Notes | 6.836% Senior Notes due 2023 | |||||
Debt Instrument [Line Items] | |||||
Principal Amount | $ 600,000,000 | ||||
Write-off of Premiums, Discounts and Issuance Costs | 0 | ||||
Call Penalties | $ 21,000,000 | ||||
Interest rate, stated percentage | 6.836% |
Debt - Debt to Affiliates - Iss
Debt - Debt to Affiliates - Issuances and Borrowings (Details) - USD ($) | Apr. 28, 2018 | Jun. 30, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 2,500,000,000 | ||||
Affiliated Entity | |||||
Debt Instrument [Line Items] | |||||
Outstanding balance on DT Notes | 14,901,000,000 | $ 14,586,000,000 | |||
4.500% Senior Notes due 2026 | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,000,000,000 | ||||
Interest rate, stated percentage | 4.50% | ||||
4.750% Senior Notes due 2028 | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,500,000,000 | ||||
Interest rate, stated percentage | 4.75% | ||||
Senior Notes | Affiliated Entity | Deutsche Telekom AG | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 2,500,000,000 | $ 2,500,000,000 | |||
Senior Reset Notes | 8.097% Senior Reset Notes to affiliates due 2021 | |||||
Debt Instrument [Line Items] | |||||
Interest rate, stated percentage | 8.097% | ||||
Senior Reset Notes | 8.097% Senior Reset Notes to affiliates due 2021 | Affiliated Entity | Deutsche Telekom AG | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,250,000,000 | $ 1,250,000,000 | |||
Interest rate, stated percentage | 8.097% | ||||
Write-off of Embedded Derivatives | (8,000,000) | ||||
Other | $ 51,000,000 | ||||
Redemption price (as a percent) | 104.0485% | ||||
Senior Reset Notes | 8.195% Senior Reset Notes to affiliates due 2022 | |||||
Debt Instrument [Line Items] | |||||
Interest rate, stated percentage | 8.195% | ||||
Senior Reset Notes | 8.195% Senior Reset Notes to affiliates due 2022 | Affiliated Entity | Deutsche Telekom AG | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,250,000,000 | $ 1,250,000,000 | |||
Interest rate, stated percentage | 8.195% | ||||
Write-off of Embedded Derivatives | (8,000,000) | ||||
Other | $ 51,000,000 | ||||
Redemption price (as a percent) | 104.0975% | ||||
Issuer | 4.500% Senior Notes due 2026 | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,000,000,000 | ||||
Interest rate, stated percentage | 4.50% | 4.50% | |||
Issuer | 4.500% Senior Notes due 2026 | Affiliated Entity | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,000,000,000 | ||||
Interest rate, stated percentage | 4.50% | ||||
Issuer | 4.500% Senior Notes due 2026 | Affiliated Entity | Deutsche Telekom AG | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,000,000,000 | ||||
Issuer | 4.750% Senior Notes due 2028 | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,500,000,000 | ||||
Interest rate, stated percentage | 4.75% | 4.75% | |||
Issuer | 4.750% Senior Notes due 2028 | Affiliated Entity | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,500,000,000 | ||||
Interest rate, stated percentage | 4.75% | ||||
Issuer | 4.750% Senior Notes due 2028 | Affiliated Entity | Deutsche Telekom AG | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,500,000,000 | ||||
Issuer | 8.097% Senior Reset Notes to affiliates due 2021 | Affiliated Entity | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,250,000,000 | ||||
Interest rate, stated percentage | 8.097% | ||||
Issuer | 8.195% Senior Reset Notes to affiliates due 2022 | Affiliated Entity | |||||
Debt Instrument [Line Items] | |||||
Principal Issuances | $ 1,250,000,000 | ||||
Interest rate, stated percentage | 8.195% |
Debt - Debt to Affiliates - Inc
Debt - Debt to Affiliates - Incremental Term Loan Facility (Details) | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Short-term Debt [Line Items] | |
Issuance Costs | $ 6,000,000 |
Deutsche Telekom AG | Affiliated Entity | |
Short-term Debt [Line Items] | |
Soft-call prepayment premium (percent) | 1.00% |
Issuance Costs | $ 0 |
Deutsche Telekom AG | LIBOR plus 1.50% Senior Secured Term Loan due 2022 | Affiliated Entity | |
Short-term Debt [Line Items] | |
Applicable margin, percentage | 1.50% |
Senior Secured Term Loans | $ 2,000,000,000 |
Deutsche Telekom AG | LIBOR plus 1.75% Senior Secured Term Loan due 2024 | Affiliated Entity | |
Short-term Debt [Line Items] | |
Applicable margin, percentage | 1.75% |
Senior Secured Term Loans | $ 2,000,000,000 |
Debt - Debt to Affiliates - Rev
Debt - Debt to Affiliates - Revolving Credit Facility (Details) - USD ($) | 1 Months Ended | |||
Mar. 31, 2018 | Jun. 30, 2018 | Jan. 31, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||||
Principal Amount | $ 3,424,000,000 | |||
Affiliated Entity | ||||
Debt Instrument [Line Items] | ||||
Principal Amount | 0 | |||
6.125% Senior Notes due 2022 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Principal Amount | $ 1,000,000,000 | $ 1,000,000,000 | ||
Interest rate, stated percentage | 6.125% | 6.125% | ||
Revolving Credit Facility [$2.5B] | Affiliated Entity | Secured Revolving Credit Facility | Minimum | ||||
Debt Instrument [Line Items] | ||||
Applicable margin, percentage | 1.05% | |||
Undrawn commitment fee, percentage | 0.25% | |||
Revolving Credit Facility [$2.5B] | Affiliated Entity | Secured Revolving Credit Facility | Maximum | ||||
Debt Instrument [Line Items] | ||||
Applicable margin, percentage | 1.80% | |||
Undrawn commitment fee, percentage | 0.45% | |||
Revolving Credit Facility [$2.5B] | Affiliated Entity | Unsecured Revolving Credit Facility | Minimum | ||||
Debt Instrument [Line Items] | ||||
Applicable margin, percentage | 2.05% | |||
Undrawn commitment fee, percentage | 0.20% | |||
Revolving Credit Facility [$2.5B] | Affiliated Entity | Unsecured Revolving Credit Facility | Maximum | ||||
Debt Instrument [Line Items] | ||||
Applicable margin, percentage | 3.05% | |||
Undrawn commitment fee, percentage | 0.575% | |||
Revolving Credit Facility [$2.5B] | Line of Credit | Affiliated Entity | Secured Revolving Credit Facility | Deutsche Telekom AG | ||||
Debt Instrument [Line Items] | ||||
Short-term debt to affiliates | $ 320,000,000 | $ 0 |
Debt - Debt to Affiliates - Com
Debt - Debt to Affiliates - Commitment Letter (Details) - Sprint - USD ($) | Jun. 30, 2018 | Jun. 06, 2018 | May 22, 2018 | Apr. 29, 2018 |
Secured and Unsecured Debt Financing | ||||
Debt Instrument [Line Items] | ||||
Financing commitment, amount | $ 30,000,000,000 | $ 38,000,000,000 | ||
Reduction of initial aggregate commitment under Commitment Letter | $ (8,000,000,000) | |||
Secured Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Financing commitment, amount | 4,000,000,000 | |||
Secured Term Loan Facility | ||||
Debt Instrument [Line Items] | ||||
Financing commitment, amount | 7,000,000,000 | |||
Secured Bridge Loan Facility | ||||
Debt Instrument [Line Items] | ||||
Financing commitment, amount | $ 19,000,000,000 | $ 27,000,000,000 | 19,000,000,000 | |
Reduction of initial aggregate commitment under Commitment Letter | $ (8,000,000,000) | |||
Unsecured Bridge Loan Facility | ||||
Debt Instrument [Line Items] | ||||
Financing commitment, amount | $ 8,000,000,000 | $ 8,000,000,000 |
Debt - Debt to Affiliates - Fin
Debt - Debt to Affiliates - Financing Matters Agreement and Consents on Debt to Third-Parties (Details) - USD ($) | May 18, 2018 | Apr. 29, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 |
Debt Instrument [Line Items] | |||||||
Repayment of debt | $ 3,920,000,000 | ||||||
Principal Issuances | $ 2,500,000,000 | 2,500,000,000 | |||||
Payments of consent fees | 38,000,000 | $ 0 | 38,000,000 | $ 0 | |||
Payments for third party bank fees | 3,185,000,000 | $ 2,915,000,000 | $ 6,349,000,000 | $ 5,870,000,000 | |||
Sprint | |||||||
Debt Instrument [Line Items] | |||||||
Notes issued and outstanding under Existing Sprint Spectrum Program (not exceed) | $ 7,000,000,000 | ||||||
Payments of consent fees | 31,000,000 | ||||||
Sprint | Credit Facilities | |||||||
Debt Instrument [Line Items] | |||||||
Financing commitment, amount | $ 9,000,000,000 | ||||||
Secured indebtedness, limit, percentage | 150.00% | ||||||
Secured debt to cash flow | 2 | ||||||
Sprint | Scenario, Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Payments for third party bank fees | $ 54,000,000 | ||||||
Sprint | Existing Sprint Spectrum Notes | Scenario, Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Payments for third party bank fees | 41,000,000 | ||||||
Sprint | Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Payments of consent fees | $ 14,000,000 | 17,000,000 | |||||
Payments for third party bank fees | 6,000,000 | ||||||
Sprint | Senior Notes | Existing Sprint Spectrum Notes | |||||||
Debt Instrument [Line Items] | |||||||
Payments of consent fees | 14,000,000 | ||||||
Sprint | Deutsche Telekom AG | |||||||
Debt Instrument [Line Items] | |||||||
Payments of consent fees | $ 7,000,000 | ||||||
Sprint | Deutsche Telekom AG | Scenario, Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Payments of consent fees | $ 20,000,000 | ||||||
Sprint | Deutsche Telekom AG | Senior Notes | 5.300% Senior Notes due 2021 | |||||||
Debt Instrument [Line Items] | |||||||
Repayment of debt | $ 2,000,000,000 | ||||||
Interest rate, stated percentage | 5.30% | ||||||
Sprint | Deutsche Telekom AG | Senior Notes | 6.000% Senior Notes due 2024 | |||||||
Debt Instrument [Line Items] | |||||||
Repayment of debt | $ 2,000,000,000 | ||||||
Interest rate, stated percentage | 6.00% | ||||||
Sprint | Deutsche Telekom AG | Senior Notes | 5.125% Senior Notes Due 2025 | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 5.125% | ||||||
Principal Issuances | $ 1,250,000,000 | ||||||
Sprint | Deutsche Telekom AG | Senior Notes | 5.375% Senior Notes Due 2027 | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 5.375% | ||||||
Principal Issuances | $ 1,250,000,000 |
Employee Compensation and Ben63
Employee Compensation and Benefit Plans - Narrative (Details) - USD ($) $ in Millions | Jun. 18, 2018 | Jun. 13, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Jun. 30, 2018 |
Restricted Stock and Unit Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted or carried over (in shares) | 5,766,642 | ||||
Performance Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted or carried over (in shares) | 3,168,197 | ||||
Sprint | Performance Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted or carried over (in shares) | 1,210,710 | ||||
Layer3 TV | Restricted Stock Awards and Incentive Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Aggregate grant date fair value | $ 30 | ||||
2013 Omnibus Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized for issuance (in shares) | 18,500,000 | ||||
Number of shares registered pursuant to the Plan (in shares) | 19,345,005 |
Employee Compensation and Ben64
Employee Compensation and Benefit Plans - Schedule of Stock-based Compensation Expense and Related Income Tax Benefits (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 112 | $ 72 | $ 209 | $ 139 |
Income tax benefit related to stock-based compensation | $ 22 | $ 16 | $ 42 | $ 32 |
Restricted Stock Units and Performance Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average fair value per stock award granted (in USD per share) | $ 72.32 | $ 63.94 | $ 61.86 | $ 63.24 |
Unrecognized compensation expense | $ 712 | $ 478 | $ 712 | $ 478 |
Weighted average period to be recognized (years) | 2 years 1 month 6 days | 1 year 10 months 24 days | 2 years 1 month 6 days | 1 year 10 months 24 days |
Fair value of stock awards vested | $ 30 | $ 12 | $ 267 | $ 295 |
Employee Compensation and Ben65
Employee Compensation and Benefit Plans - Schedule of Restricted Stock and Unit Awards and Performance Restricted Stock Units Activity (Details) $ / shares in Units, $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | |
Minimum | ||
Aggregate Intrinsic Value | ||
Share payout percentage | 0.00% | |
Maximum | ||
Aggregate Intrinsic Value | ||
Share payout percentage | 200.00% | |
Restricted Stock and Unit Awards | ||
Number of Units or Awards | ||
Nonvested, December 31, 2017 (in shares) | shares | 12,061,608 | |
Granted (in shares) | shares | 5,766,642 | |
Vested (in shares) | shares | 3,448,666 | |
Forfeited (in shares) | shares | 450,845 | |
Nonvested, June 30, 2018 (in shares) | shares | 13,928,739 | 12,061,608 |
Weighted Average Grant Date Fair Value | ||
Nonvested, December 31, 2017 (in USD per share) | $ / shares | $ 50.69 | |
Granted (in USD per share) | $ / shares | 59.91 | |
Vested (in USD per share) | $ / shares | 45.03 | |
Forfeited (in USD per share) | $ / shares | 56.39 | |
Nonvested, June 30, 2018 (in USD per share) | $ / shares | $ 55.94 | $ 50.69 |
Weighted Average Remaining Contractual Term (Years) | ||
Nonvested, Weighted Average Remaining Contractual Term, December 31, 2017 (in years) | 1 year 2 months 18 days | 1 year 1 month 6 days |
Nonvested, Weighted Average Remaining Contractual Term, June 30, 2018 (in years) | 1 year 2 months 18 days | 1 year 1 month 6 days |
Aggregate Intrinsic Value | ||
Nonvested, Aggregate Intrinsic Value, December 31, 2017 | $ | $ 832 | $ 766 |
Nonvested, Aggregate Intrinsic Value, June 30, 2018 | $ | $ 832 | $ 766 |
Performance Restricted Stock Units | ||
Number of Units or Awards | ||
Nonvested, December 31, 2017 (in shares) | shares | 1,633,935 | |
Granted (in shares) | shares | 3,168,197 | |
Vested (in shares) | shares | 1,006,769 | |
Forfeited (in shares) | shares | 11,580 | |
Nonvested, June 30, 2018 (in shares) | shares | 3,783,783 | 1,633,935 |
Weighted Average Grant Date Fair Value | ||
Nonvested, December 31, 2017 (in USD per share) | $ / shares | $ 48.06 | |
Granted (in USD per share) | $ / shares | 65.97 | |
Vested (in USD per share) | $ / shares | 36.47 | |
Forfeited (in USD per share) | $ / shares | 66.32 | |
Nonvested, June 30, 2018 (in USD per share) | $ / shares | $ 62.62 | $ 48.06 |
Weighted Average Remaining Contractual Term (Years) | ||
Nonvested, Weighted Average Remaining Contractual Term, December 31, 2017 (in years) | 1 year 10 months 24 days | 1 year 1 month 6 days |
Nonvested, Weighted Average Remaining Contractual Term, June 30, 2018 (in years) | 1 year 10 months 24 days | 1 year 1 month 6 days |
Aggregate Intrinsic Value | ||
Nonvested, Aggregate Intrinsic Value, December 31, 2017 | $ | $ 226 | $ 104 |
Nonvested, Aggregate Intrinsic Value, June 30, 2018 | $ | $ 226 | $ 104 |
Revenue from Contracts with C66
Revenue from Contracts with Customers - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Branded postpaid revenues | $ 5,164 | $ 4,820 | $ 10,234 | $ 9,545 |
Branded postpaid phone revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 4,892 | 4,565 | 9,703 | 9,065 |
Branded postpaid other revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 272 | 255 | 531 | 480 |
Lease of mobile communication devices and accessories | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 177 | $ 234 | $ 348 | $ 558 |
Revenue from Contracts with C67
Revenue from Contracts with Customers - Contract Balances (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2018 | Dec. 31, 2017 | |
Change in Contract with Customer, Asset and Liability [Abstract] | |||
Contract assets included in other current assets | $ 69 | $ 69 | $ 140 |
Contract liabilities included in deferred revenue | 677 | 677 | $ 718 |
Change in contract assets included in other current assets | (71) | ||
Change in contracts liabilities included in deferred revenue | (41) | ||
Amounts included in the beginning of period contract liability balance | 31 | 559 | |
Amounts associated with performance obligations satisfied in previous periods | $ 11 | $ 11 |
Revenue from Contracts with C68
Revenue from Contracts with Customers - Remaining Performance Obligations, Branded Postpaid Contracts (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Branded postpaid contracts | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 525 |
Remaining contract duration | 24 months |
Minimum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining contract duration | 1 year |
Maximum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining contract duration | 7 years |
Revenue from Contracts with C69
Revenue from Contracts with Customers - Remaining Performance Obligations (Details) $ in Millions | Jun. 30, 2018USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 513 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | 983 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 783 |
Revenue from Contracts with C70
Revenue from Contracts with Customers - Contract Costs (Details) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2018USD ($) | Jun. 30, 2018USD ($) | |
Capitalized Contract Cost [Abstract] | ||
Total deferred incremental costs to obtain contracts | $ 410,000,000 | $ 410,000,000 |
Average amortization period, deferred contract costs | 24 months | |
Amortization of deferred costs | 57,000,000 | $ 92,000,000 |
Impairment losses recognized on deferred contract cost assets | $ 0 | $ 0 |
Repurchases of Common Stock - N
Repurchases of Common Stock - Narrative (Details) - USD ($) | 3 Months Ended | 5 Months Ended | 6 Months Ended | |||||
Jun. 30, 2018 | Mar. 31, 2018 | Apr. 27, 2018 | Jun. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 06, 2017 | |
Affiliated Entity | Deutsche Telekom AG | ||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||
Additional shares purchased (in shares) | 0 | 3,300,000 | ||||||
Aggregate market value of shares purchased | $ 200,000,000 | |||||||
2017 Stock Repurchase Program | ||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||
Stock repurchase program, authorized amount | $ 9,000,000,000 | $ 1,500,000,000 | ||||||
Common stock repurchased (in shares) | 6,200,000 | 23,700,000 | 16,700,000 | |||||
Common stock repurchased | $ 388,000,000 | $ 1,500,000,000 | $ 1,100,000,000 | |||||
Average price paid per share (usd per share) | $ 63.07 | |||||||
2018 Stock Repurchase Program | ||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||
Stock repurchase program, increase in authorized amount | $ 7,500,000,000 | |||||||
2018 Stock Repurchase Program | Scenario, Forecast | ||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||
Stock repurchase program, authorized amount | $ 4,000,000,000 | $ 3,000,000,000 | $ 500,000,000 |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 782 | $ 581 | $ 1,453 | $ 1,279 |
Less: Dividends on mandatory convertible preferred stock | 0 | (14) | 0 | (28) |
Net income attributable to common stockholders | 782 | 567 | 1,453 | 1,251 |
Add: Dividends related to mandatory convertible preferred stock | 0 | 14 | 0 | 28 |
Net income attributable to common stockholders - diluted | $ 782 | $ 581 | $ 1,453 | $ 1,279 |
Weighted average shares outstanding - basic (in shares) | 847,660,488 | 830,971,528 | 851,420,686 | 829,356,255 |
Effect of dilutive securities: | ||||
Outstanding stock options and unvested stock awards (in shares) | 4,380,182 | 7,247,653 | 7,308,146 | 9,260,131 |
Mandatory convertible preferred stock (in shares) | 0 | 32,238,000 | 0 | 32,238,000 |
Weighted average shares outstanding - diluted (in shares) | 852,040,670 | 870,457,181 | 858,728,832 | 870,854,386 |
Earnings per share - basic (in USD per share) | $ 0.92 | $ 0.68 | $ 1.71 | $ 1.51 |
Earnings per share - diluted (in USD per share) | $ 0.92 | $ 0.67 | $ 1.69 | $ 1.47 |
Outstanding stock options and unvested stock awards (in shares) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities (in shares) | 797,948 | 48,397 | 487,133 | 71,734 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - $ / shares | Dec. 15, 2017 | Jun. 30, 2018 | Jun. 30, 2017 |
Mandatory Convertible Preferred Stock Series A | |||
Class of Stock [Line Items] | |||
Preferred shares authorized (in shares) | 100,000,000 | ||
Preferred stock rate (percent) | 5.50% | ||
Preferred stock, par value (in USD per share) | $ 0.00001 | ||
Preferred shares outstanding (in shares) | 0 | 20,000,000 | |
Conversion of stock, shares converted (in shares) | 20,000,000 | ||
Common Stock | |||
Class of Stock [Line Items] | |||
Stock issued upon conversion (in shares) | 32,000,000 | ||
Stock conversion ratio (in shares) | 1.6119 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2018 | Feb. 28, 2018 | Jun. 30, 2018 |
Operating Leased Assets [Line Items] | ||||
Operating leases, due 2019 | $ 2,500 | $ 2,500 | $ 2,500 | |
Operating leases, total due 2020 and 2021 | 4,300 | 4,300 | 4,300 | |
Operating leases, total dude 2022 and 2023 | 2,800 | 2,800 | 2,800 | |
Operating leases total due thereafter | 2,800 | 2,800 | 2,800 | |
Purchase obligation, due 2019 | 2,200 | 2,200 | 2,200 | |
Purchase obligation, due 2020 and 2021 | 2,500 | 2,500 | 2,500 | |
Purchase obligation, Due 2022 and 2023 | 1,600 | 1,600 | 1,600 | |
Purchase obligation total due thereafter | 1,100 | 1,100 | $ 1,100 | |
Corporate Headquarters Facility | ||||
Operating Leased Assets [Line Items] | ||||
Increase in minimum lease payments | $ 400 | |||
Tower Obligations | ||||
Operating Leased Assets [Line Items] | ||||
Increase in minimum lease payments | $ 385 | |||
Minimum | Network Equipment | ||||
Operating Leased Assets [Line Items] | ||||
Network equipment purchase agreement | $ 175 | |||
Maximum | Network Equipment | ||||
Operating Leased Assets [Line Items] | ||||
Network equipment purchase agreement | $ 3,500 | |||
Cell Sites | Minimum | ||||
Operating Leased Assets [Line Items] | ||||
Initial non-cancelable term | 5 years | |||
Cell Sites | Maximum | ||||
Operating Leased Assets [Line Items] | ||||
Initial non-cancelable term | 10 years |
Guarantor Financial Informati75
Guarantor Financial Information - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Apr. 30, 2018 | Jan. 31, 2018 | |
Condensed Financial Statements, Captions [Line Items] | ||||||
Principal Issuances | $ 2,500 | $ 2,500 | ||||
Net cash provided by (used in) operating activities | 1,261 | $ 1,106 | 2,031 | $ 1,714 | ||
Net cash (used in) provided by financing activities | (3,267) | (2,175) | (2,267) | (366) | ||
Issuer | Reportable Legal Entities | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Net cash provided by (used in) operating activities | (258) | (795) | (662) | (929) | ||
Net cash (used in) provided by financing activities | 260 | (2,342) | 664 | (1,803) | ||
Issuer | Reportable Legal Entities | Reclassification Adjustment | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Net cash provided by (used in) operating activities | 9,000 | 13,900 | ||||
Net cash (used in) provided by financing activities | 9,000 | 13,900 | ||||
Guarantor Subsidiaries | Reportable Legal Entities | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Net cash provided by (used in) operating activities | 2,932 | 2,816 | 5,306 | 4,671 | ||
Net cash (used in) provided by financing activities | (3,526) | 490 | (2,847) | 1,770 | ||
Guarantor Subsidiaries | Reportable Legal Entities | Reclassification Adjustment | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Net cash provided by (used in) operating activities | 9,000 | 14,000 | ||||
Net cash (used in) provided by financing activities | (9,000) | (14,000) | ||||
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Net cash provided by (used in) operating activities | (1,282) | (836) | (2,483) | (1,950) | ||
Net cash (used in) provided by financing activities | (106) | (85) | (115) | (96) | ||
Non-Guarantor Subsidiaries | Reportable Legal Entities | Reclassification Adjustment | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Net cash provided by (used in) operating activities | 5 | 16 | ||||
Net cash (used in) provided by financing activities | $ 5 | $ 16 | ||||
4.500% Senior Notes due 2026 | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Principal Issuances | $ 1,000 | $ 1,000 | ||||
Interest rate, stated percentage | 4.50% | 4.50% | ||||
4.500% Senior Notes due 2026 | Issuer | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Principal Issuances | $ 1,000 | |||||
Interest rate, stated percentage | 4.50% | 4.50% | ||||
4.500% Senior Notes due 2026 | Issuer | Affiliated Entity | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Principal Issuances | $ 1,000 | |||||
Interest rate, stated percentage | 4.50% | |||||
4.750% Senior Notes due 2028 | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Principal Issuances | $ 1,500 | $ 1,500 | ||||
Interest rate, stated percentage | 4.75% | 4.75% | ||||
4.750% Senior Notes due 2028 | Issuer | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Principal Issuances | $ 1,500 | |||||
Interest rate, stated percentage | 4.75% | 4.75% | ||||
4.750% Senior Notes due 2028 | Issuer | Affiliated Entity | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Principal Issuances | $ 1,500 | |||||
Interest rate, stated percentage | 4.75% | |||||
8.097% Senior Reset Notes to affiliates due 2021 | Issuer | Affiliated Entity | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Principal Issuances | $ 1,250 | |||||
Interest rate, stated percentage | 8.097% | |||||
8.195% Senior Reset Notes to affiliates due 2022 | Issuer | Affiliated Entity | ||||||
Condensed Financial Statements, Captions [Line Items] | ||||||
Principal Issuances | $ 1,250 | |||||
Interest rate, stated percentage | 8.195% |
Guarantor Financial Informati76
Guarantor Financial Information - Condensed Consolidating Balance Sheet Information (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Mar. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets | |||||||
Cash and cash equivalents | $ 215 | $ 2,527 | $ 1,219 | $ 181 | $ 7,501 | $ 5,500 | |
Accounts receivable, net | 1,630 | 1,915 | |||||
Equipment installment plan receivables, net | 2,308 | 2,290 | |||||
Accounts receivable from affiliates | 11 | 22 | |||||
Inventories | 998 | 1,566 | |||||
Other current assets | 1,929 | $ 2,043 | 1,903 | ||||
Total current assets | 7,091 | 8,915 | |||||
Property and equipment, net | 22,375 | 22,196 | |||||
Goodwill | 1,901 | 1,683 | |||||
Spectrum licenses | 35,532 | 35,366 | |||||
Other intangible assets, net | 260 | 217 | |||||
Investments in subsidiaries, net | 0 | 0 | |||||
Intercompany receivables and note receivables | 0 | 0 | |||||
Equipment installment plan receivables due after one year, net | 1,222 | 1,274 | |||||
Other assets | 1,311 | 1,062 | 912 | ||||
Total assets | 69,692 | 70,563 | |||||
Current liabilities | |||||||
Accounts payable and accrued liabilities | 6,686 | 8,528 | |||||
Payables to affiliates | 190 | 182 | |||||
Short-term debt | 1,004 | 1,612 | |||||
Short-term debt to affiliates | 320 | 0 | |||||
Deferred revenue | 722 | $ 783 | 779 | ||||
Other current liabilities | 359 | 414 | |||||
Total current liabilities | 9,281 | 11,515 | |||||
Long-term debt | 12,065 | 12,121 | |||||
Long-term debt to affiliates | 14,581 | 14,586 | |||||
Tower obligations | 2,574 | 2,590 | |||||
Deferred tax liabilities | 4,087 | 3,537 | |||||
Deferred rent expense | 2,746 | 2,720 | |||||
Negative carrying value of subsidiaries, net | 0 | 0 | |||||
Intercompany payables and debt | 0 | 0 | |||||
Other long-term liabilities | 968 | 935 | |||||
Total long-term liabilities | 37,021 | 36,489 | |||||
Total stockholders' equity (deficit) | 23,390 | 22,559 | |||||
Total liabilities and stockholders' equity | 69,692 | 70,563 | |||||
Consolidating and Eliminating Adjustments | |||||||
Current assets | |||||||
Cash and cash equivalents | 0 | 0 | 0 | 0 | 0 | 0 | |
Accounts receivable, net | 0 | 0 | |||||
Equipment installment plan receivables, net | 0 | 0 | |||||
Accounts receivable from affiliates | 0 | 0 | |||||
Inventories | 0 | 0 | |||||
Other current assets | 0 | 0 | |||||
Total current assets | 0 | 0 | |||||
Property and equipment, net | 0 | 0 | |||||
Goodwill | 0 | 0 | |||||
Spectrum licenses | 0 | 0 | |||||
Other intangible assets, net | 0 | 0 | |||||
Investments in subsidiaries, net | (67,794) | (63,522) | |||||
Intercompany receivables and note receivables | (7,188) | (8,503) | |||||
Equipment installment plan receivables due after one year, net | 0 | 0 | |||||
Other assets | (152) | (140) | |||||
Total assets | (75,134) | (72,165) | |||||
Current liabilities | |||||||
Accounts payable and accrued liabilities | 0 | 0 | |||||
Payables to affiliates | 0 | 0 | |||||
Short-term debt | 0 | 0 | |||||
Short-term debt to affiliates | 0 | ||||||
Deferred revenue | 0 | 0 | |||||
Other current liabilities | 0 | 0 | |||||
Total current liabilities | 0 | 0 | |||||
Long-term debt | 0 | 0 | |||||
Long-term debt to affiliates | 0 | 0 | |||||
Tower obligations | 0 | 0 | |||||
Deferred tax liabilities | (152) | (140) | |||||
Deferred rent expense | 0 | 0 | |||||
Negative carrying value of subsidiaries, net | (620) | (629) | |||||
Intercompany payables and debt | (7,188) | (8,503) | |||||
Other long-term liabilities | 0 | 0 | |||||
Total long-term liabilities | (7,960) | (9,272) | |||||
Total stockholders' equity (deficit) | (67,174) | (62,893) | |||||
Total liabilities and stockholders' equity | (75,134) | (72,165) | |||||
Parent | Reportable Legal Entities | |||||||
Current assets | |||||||
Cash and cash equivalents | 1 | 1 | 74 | 43 | 360 | 358 | |
Accounts receivable, net | 0 | 0 | |||||
Equipment installment plan receivables, net | 0 | 0 | |||||
Accounts receivable from affiliates | 0 | 0 | |||||
Inventories | 0 | 0 | |||||
Other current assets | 0 | 0 | |||||
Total current assets | 1 | 74 | |||||
Property and equipment, net | 0 | 0 | |||||
Goodwill | 0 | 0 | |||||
Spectrum licenses | 0 | 0 | |||||
Other intangible assets, net | 0 | 0 | |||||
Investments in subsidiaries, net | 24,212 | 22,534 | |||||
Intercompany receivables and note receivables | 0 | 0 | |||||
Equipment installment plan receivables due after one year, net | 0 | 0 | |||||
Other assets | 0 | 0 | |||||
Total assets | 24,213 | 22,608 | |||||
Current liabilities | |||||||
Accounts payable and accrued liabilities | 0 | 0 | |||||
Payables to affiliates | 0 | 0 | |||||
Short-term debt | 0 | 0 | |||||
Short-term debt to affiliates | 0 | ||||||
Deferred revenue | 0 | 0 | |||||
Other current liabilities | 0 | 17 | |||||
Total current liabilities | 0 | 17 | |||||
Long-term debt | 0 | 0 | |||||
Long-term debt to affiliates | 0 | 0 | |||||
Tower obligations | 0 | 0 | |||||
Deferred tax liabilities | 0 | 0 | |||||
Deferred rent expense | 0 | 0 | |||||
Negative carrying value of subsidiaries, net | 0 | 0 | |||||
Intercompany payables and debt | 823 | 32 | |||||
Other long-term liabilities | 0 | 0 | |||||
Total long-term liabilities | 823 | 32 | |||||
Total stockholders' equity (deficit) | 23,390 | 22,559 | |||||
Total liabilities and stockholders' equity | 24,213 | 22,608 | |||||
Issuer | Reportable Legal Entities | |||||||
Current assets | |||||||
Cash and cash equivalents | 3 | 1 | 1 | 1 | 3,138 | 2,733 | |
Accounts receivable, net | 0 | 0 | |||||
Equipment installment plan receivables, net | 0 | 0 | |||||
Accounts receivable from affiliates | 0 | 0 | |||||
Inventories | 0 | 0 | |||||
Other current assets | 0 | 0 | |||||
Total current assets | 3 | 1 | |||||
Property and equipment, net | 0 | 0 | |||||
Goodwill | 0 | 0 | |||||
Spectrum licenses | 0 | 0 | |||||
Other intangible assets, net | 0 | 0 | |||||
Investments in subsidiaries, net | 43,582 | 40,988 | |||||
Intercompany receivables and note receivables | 7,188 | 8,503 | |||||
Equipment installment plan receivables due after one year, net | 0 | 0 | |||||
Other assets | 6 | 2 | |||||
Total assets | 50,779 | 49,494 | |||||
Current liabilities | |||||||
Accounts payable and accrued liabilities | 232 | 253 | |||||
Payables to affiliates | 158 | 146 | |||||
Short-term debt | 300 | 999 | |||||
Short-term debt to affiliates | 320 | ||||||
Deferred revenue | 0 | 0 | |||||
Other current liabilities | 0 | 0 | |||||
Total current liabilities | 1,010 | 1,398 | |||||
Long-term debt | 10,947 | 10,911 | |||||
Long-term debt to affiliates | 14,581 | 14,586 | |||||
Tower obligations | 0 | 0 | |||||
Deferred tax liabilities | 0 | 0 | |||||
Deferred rent expense | 0 | 0 | |||||
Negative carrying value of subsidiaries, net | 0 | 0 | |||||
Intercompany payables and debt | 0 | 0 | |||||
Other long-term liabilities | 29 | 65 | |||||
Total long-term liabilities | 25,557 | 25,562 | |||||
Total stockholders' equity (deficit) | 24,212 | 22,534 | |||||
Total liabilities and stockholders' equity | 50,779 | 49,494 | |||||
Guarantor Subsidiaries | Reportable Legal Entities | |||||||
Current assets | |||||||
Cash and cash equivalents | 163 | 2,395 | 1,086 | 121 | 3,937 | 2,342 | |
Accounts receivable, net | 1,411 | 1,659 | |||||
Equipment installment plan receivables, net | 2,308 | 2,290 | |||||
Accounts receivable from affiliates | 11 | 22 | |||||
Inventories | 998 | 1,566 | |||||
Other current assets | 1,242 | 1,275 | |||||
Total current assets | 6,133 | 7,898 | |||||
Property and equipment, net | 22,061 | 21,890 | |||||
Goodwill | 1,683 | 1,683 | |||||
Spectrum licenses | 35,532 | 35,366 | |||||
Other intangible assets, net | 169 | 217 | |||||
Investments in subsidiaries, net | 0 | 0 | |||||
Intercompany receivables and note receivables | 0 | 0 | |||||
Equipment installment plan receivables due after one year, net | 1,222 | 1,274 | |||||
Other assets | 1,220 | 814 | |||||
Total assets | 68,020 | 69,142 | |||||
Current liabilities | |||||||
Accounts payable and accrued liabilities | 6,166 | 8,014 | |||||
Payables to affiliates | 32 | 36 | |||||
Short-term debt | 703 | 613 | |||||
Short-term debt to affiliates | 0 | ||||||
Deferred revenue | 722 | 779 | |||||
Other current liabilities | 175 | 192 | |||||
Total current liabilities | 7,798 | 9,634 | |||||
Long-term debt | 1,118 | 1,210 | |||||
Long-term debt to affiliates | 0 | 0 | |||||
Tower obligations | 389 | 392 | |||||
Deferred tax liabilities | 4,239 | 3,677 | |||||
Deferred rent expense | 2,746 | 2,720 | |||||
Negative carrying value of subsidiaries, net | 620 | 629 | |||||
Intercompany payables and debt | 6,087 | 8,201 | |||||
Other long-term liabilities | 919 | 866 | |||||
Total long-term liabilities | 16,118 | 17,695 | |||||
Total stockholders' equity (deficit) | 44,104 | 41,813 | |||||
Total liabilities and stockholders' equity | 68,020 | 69,142 | |||||
Non-Guarantor Subsidiaries | Reportable Legal Entities | |||||||
Current assets | |||||||
Cash and cash equivalents | 48 | $ 130 | 58 | $ 16 | $ 66 | $ 67 | |
Accounts receivable, net | 219 | 256 | |||||
Equipment installment plan receivables, net | 0 | 0 | |||||
Accounts receivable from affiliates | 0 | 0 | |||||
Inventories | 0 | 0 | |||||
Other current assets | 687 | 628 | |||||
Total current assets | 954 | 942 | |||||
Property and equipment, net | 314 | 306 | |||||
Goodwill | 218 | 0 | |||||
Spectrum licenses | 0 | 0 | |||||
Other intangible assets, net | 91 | 0 | |||||
Investments in subsidiaries, net | 0 | 0 | |||||
Intercompany receivables and note receivables | 0 | 0 | |||||
Equipment installment plan receivables due after one year, net | 0 | 0 | |||||
Other assets | 237 | 236 | |||||
Total assets | 1,814 | 1,484 | |||||
Current liabilities | |||||||
Accounts payable and accrued liabilities | 288 | 261 | |||||
Payables to affiliates | 0 | 0 | |||||
Short-term debt | 1 | 0 | |||||
Short-term debt to affiliates | 0 | ||||||
Deferred revenue | 0 | 0 | |||||
Other current liabilities | 184 | 205 | |||||
Total current liabilities | 473 | 466 | |||||
Long-term debt | 0 | 0 | |||||
Long-term debt to affiliates | 0 | 0 | |||||
Tower obligations | 2,185 | 2,198 | |||||
Deferred tax liabilities | 0 | 0 | |||||
Deferred rent expense | 0 | 0 | |||||
Negative carrying value of subsidiaries, net | 0 | 0 | |||||
Intercompany payables and debt | 278 | 270 | |||||
Other long-term liabilities | 20 | 4 | |||||
Total long-term liabilities | 2,483 | 2,472 | |||||
Total stockholders' equity (deficit) | (1,142) | (1,454) | |||||
Total liabilities and stockholders' equity | $ 1,814 | $ 1,484 |
Guarantor Financial Informati77
Guarantor Financial Information - Condensed Consolidating Statement of Comprehensive Income Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenues | ||||
Service revenues | $ 7,931 | $ 7,445 | $ 15,737 | $ 14,774 |
Equipment revenues | 2,325 | 2,506 | 4,678 | 4,549 |
Other revenues | 315 | 262 | 611 | 503 |
Total revenues | 10,571 | 10,213 | 21,026 | 19,826 |
Operating expenses | ||||
Cost of services, exclusive of depreciation and amortization shown separately below | 1,530 | 1,518 | 3,119 | 2,926 |
Cost of equipment sales | 2,772 | 2,846 | 5,617 | 5,532 |
Selling, general and administrative | 3,185 | 2,915 | 6,349 | 5,870 |
Depreciation and amortization | 1,634 | 1,519 | 3,209 | 3,083 |
Gains on disposal of spectrum licenses | 0 | (1) | 0 | (38) |
Total operating expense | 9,121 | 8,797 | 18,294 | 17,373 |
Operating income | 1,450 | 1,416 | 2,732 | 2,453 |
Other income (expense) | ||||
Interest expense | (196) | (265) | (447) | (604) |
Interest expense to affiliates | (128) | (131) | (294) | (231) |
Interest income | 6 | 6 | 12 | 13 |
Other expense, net | (64) | (92) | (54) | (90) |
Total other expense, net | (382) | (482) | (783) | (912) |
Income before income taxes | 1,068 | 934 | 1,949 | 1,541 |
Income tax expense | (286) | (353) | (496) | (262) |
Earnings of subsidiaries | 0 | 0 | 0 | 0 |
Net income | 782 | 581 | 1,453 | 1,279 |
Dividends on preferred stock | 0 | (14) | 0 | (28) |
Net income attributable to common stockholders | 782 | 567 | 1,453 | 1,251 |
Other comprehensive income (loss), net of tax | 3 | 1 | 0 | 2 |
Total comprehensive income | 785 | 582 | 1,453 | 1,281 |
Consolidating and Eliminating Adjustments | ||||
Revenues | ||||
Service revenues | (229) | (210) | (450) | (424) |
Equipment revenues | (46) | (69) | (100) | (169) |
Other revenues | (9) | (5) | (18) | (10) |
Total revenues | (284) | (284) | (568) | (603) |
Operating expenses | ||||
Cost of services, exclusive of depreciation and amortization shown separately below | 0 | 0 | 0 | 0 |
Cost of equipment sales | (46) | (69) | (101) | (169) |
Selling, general and administrative | (238) | (215) | (467) | (434) |
Depreciation and amortization | 0 | 0 | 0 | 0 |
Gains on disposal of spectrum licenses | 0 | 0 | ||
Total operating expense | (284) | (284) | (568) | (603) |
Operating income | 0 | 0 | 0 | 0 |
Other income (expense) | ||||
Interest expense | 0 | 0 | 0 | 0 |
Interest expense to affiliates | 5 | 6 | 10 | 12 |
Interest income | (5) | (6) | (10) | (12) |
Other expense, net | 0 | 0 | 0 | 0 |
Total other expense, net | 0 | 0 | 0 | 0 |
Income before income taxes | 0 | 0 | 0 | 0 |
Income tax expense | 0 | 0 | 0 | 0 |
Earnings of subsidiaries | (1,893) | (1,585) | (3,594) | (3,301) |
Net income | (1,893) | (1,585) | (3,594) | (3,301) |
Dividends on preferred stock | 0 | 0 | ||
Net income attributable to common stockholders | (1,585) | (3,301) | ||
Other comprehensive income (loss), net of tax | (6) | (1) | 0 | (4) |
Total comprehensive income | (1,899) | (1,586) | (3,594) | (3,305) |
Parent | Reportable Legal Entities | ||||
Revenues | ||||
Service revenues | 0 | 0 | 0 | 0 |
Equipment revenues | 0 | 0 | 0 | 0 |
Other revenues | 0 | 0 | 0 | 0 |
Total revenues | 0 | 0 | 0 | 0 |
Operating expenses | ||||
Cost of services, exclusive of depreciation and amortization shown separately below | 0 | 0 | 0 | 0 |
Cost of equipment sales | 0 | 0 | 0 | 0 |
Selling, general and administrative | 0 | 0 | 0 | 0 |
Depreciation and amortization | 0 | 0 | 0 | 0 |
Gains on disposal of spectrum licenses | 0 | 0 | ||
Total operating expense | 0 | 0 | 0 | 0 |
Operating income | 0 | 0 | 0 | 0 |
Other income (expense) | ||||
Interest expense | 0 | 0 | 0 | 0 |
Interest expense to affiliates | 0 | 0 | 0 | 0 |
Interest income | 0 | 0 | 0 | 0 |
Other expense, net | 0 | 0 | 0 | 0 |
Total other expense, net | 0 | 0 | 0 | 0 |
Income before income taxes | 0 | 0 | 0 | 0 |
Income tax expense | 0 | 0 | 0 | 0 |
Earnings of subsidiaries | 782 | 581 | 1,453 | 1,279 |
Net income | 782 | 581 | 1,453 | 1,279 |
Dividends on preferred stock | (14) | (28) | ||
Net income attributable to common stockholders | 567 | 1,251 | ||
Other comprehensive income (loss), net of tax | 3 | 1 | 0 | 2 |
Total comprehensive income | 785 | 582 | 1,453 | 1,281 |
Issuer | Reportable Legal Entities | ||||
Revenues | ||||
Service revenues | 0 | 0 | 0 | 0 |
Equipment revenues | 0 | 0 | 0 | 0 |
Other revenues | 2 | 0 | 3 | 0 |
Total revenues | 2 | 0 | 3 | 0 |
Operating expenses | ||||
Cost of services, exclusive of depreciation and amortization shown separately below | 0 | 0 | 0 | 0 |
Cost of equipment sales | 0 | 0 | 0 | 0 |
Selling, general and administrative | 6 | 0 | 6 | 0 |
Depreciation and amortization | 0 | 0 | 0 | 0 |
Gains on disposal of spectrum licenses | 0 | 0 | ||
Total operating expense | 6 | 0 | 6 | 0 |
Operating income | (4) | 0 | (3) | 0 |
Other income (expense) | ||||
Interest expense | (120) | (194) | (294) | (458) |
Interest expense to affiliates | (129) | (132) | (295) | (231) |
Interest income | 6 | 8 | 12 | 17 |
Other expense, net | (59) | (91) | (91) | (88) |
Total other expense, net | (302) | (409) | (668) | (760) |
Income before income taxes | (306) | (409) | (671) | (760) |
Income tax expense | 0 | 0 | 0 | 0 |
Earnings of subsidiaries | 1,088 | 990 | 2,124 | 2,039 |
Net income | 782 | 581 | 1,453 | 1,279 |
Dividends on preferred stock | 0 | 0 | ||
Net income attributable to common stockholders | 581 | 1,279 | ||
Other comprehensive income (loss), net of tax | 3 | 1 | 0 | 2 |
Total comprehensive income | 785 | 582 | 1,453 | 1,281 |
Guarantor Subsidiaries | Reportable Legal Entities | ||||
Revenues | ||||
Service revenues | 7,609 | 7,127 | 15,096 | 14,145 |
Equipment revenues | 2,370 | 2,575 | 4,777 | 4,718 |
Other revenues | 267 | 216 | 516 | 410 |
Total revenues | 10,246 | 9,918 | 20,389 | 19,273 |
Operating expenses | ||||
Cost of services, exclusive of depreciation and amortization shown separately below | 1,522 | 1,512 | 3,102 | 2,914 |
Cost of equipment sales | 2,556 | 2,664 | 5,220 | 5,204 |
Selling, general and administrative | 3,201 | 2,933 | 6,358 | 5,861 |
Depreciation and amortization | 1,611 | 1,501 | 3,165 | 3,047 |
Gains on disposal of spectrum licenses | (1) | (38) | ||
Total operating expense | 8,890 | 8,609 | 17,845 | 16,988 |
Operating income | 1,356 | 1,309 | 2,544 | 2,285 |
Other income (expense) | ||||
Interest expense | (28) | (23) | (57) | (50) |
Interest expense to affiliates | (4) | (5) | (9) | (12) |
Interest income | 4 | 4 | 9 | 8 |
Other expense, net | (5) | (1) | 37 | (2) |
Total other expense, net | (33) | (25) | (20) | (56) |
Income before income taxes | 1,323 | 1,284 | 2,524 | 2,229 |
Income tax expense | (277) | (333) | (476) | (237) |
Earnings of subsidiaries | 23 | 14 | 17 | (17) |
Net income | 1,069 | 965 | 2,065 | 1,975 |
Dividends on preferred stock | 0 | 0 | ||
Net income attributable to common stockholders | 965 | 1,975 | ||
Other comprehensive income (loss), net of tax | 3 | 1 | 0 | 2 |
Total comprehensive income | 1,072 | 966 | 2,065 | 1,977 |
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||||
Revenues | ||||
Service revenues | 551 | 528 | 1,091 | 1,053 |
Equipment revenues | 1 | 0 | 1 | 0 |
Other revenues | 55 | 51 | 110 | 103 |
Total revenues | 607 | 579 | 1,202 | 1,156 |
Operating expenses | ||||
Cost of services, exclusive of depreciation and amortization shown separately below | 8 | 6 | 17 | 12 |
Cost of equipment sales | 262 | 251 | 498 | 497 |
Selling, general and administrative | 216 | 197 | 452 | 443 |
Depreciation and amortization | 23 | 18 | 44 | 36 |
Gains on disposal of spectrum licenses | 0 | 0 | ||
Total operating expense | 509 | 472 | 1,011 | 988 |
Operating income | 98 | 107 | 191 | 168 |
Other income (expense) | ||||
Interest expense | (48) | (48) | (96) | (96) |
Interest expense to affiliates | 0 | 0 | 0 | 0 |
Interest income | 1 | 0 | 1 | 0 |
Other expense, net | 0 | 0 | 0 | 0 |
Total other expense, net | (47) | (48) | (95) | (96) |
Income before income taxes | 51 | 59 | 96 | 72 |
Income tax expense | (9) | (20) | (20) | (25) |
Earnings of subsidiaries | 0 | 0 | 0 | 0 |
Net income | 42 | 39 | 76 | 47 |
Dividends on preferred stock | 0 | 0 | ||
Net income attributable to common stockholders | 39 | 47 | ||
Other comprehensive income (loss), net of tax | 0 | (1) | 0 | 0 |
Total comprehensive income | $ 42 | $ 38 | $ 76 | $ 47 |
Guarantor Financial Informati78
Guarantor Financial Information - Condensed Consolidating Statement of Cash Flows Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Operating activities | ||||
Net cash provided by (used in) operating activities | $ 1,261 | $ 1,106 | $ 2,031 | $ 1,714 |
Investing activities | ||||
Purchases of property and equipment | (1,629) | (1,347) | (2,995) | (2,875) |
Purchases of spectrum licenses and other intangible assets, including deposits | (28) | (5,791) | (79) | (5,805) |
Proceeds related to beneficial interests in securitization transactions | 1,323 | 882 | 2,618 | 2,016 |
Acquisition of companies, net of cash acquired | (5) | 0 | (338) | 0 |
Equity investment in subsidiary | 0 | 0 | 0 | 0 |
Other, net | 33 | 5 | 26 | (3) |
Net cash used in investing activities | (306) | (6,251) | (768) | (6,667) |
Financing activities | ||||
Proceeds from issuance of long-term debt | 0 | 4,485 | 2,494 | 9,980 |
Payments of consent fees related to long-term debt | (38) | 0 | (38) | 0 |
Proceeds from borrowing on revolving credit facility | 2,070 | 1,855 | 4,240 | 1,855 |
Repayments of revolving credit facility | (2,195) | (1,175) | (3,920) | (1,175) |
Repayments of capital lease obligations | (155) | (119) | (327) | (209) |
Repayments of short-term debt for purchases of inventory, property and equipment, net | 0 | (292) | 0 | (292) |
Repayments of long-term debt | (2,350) | (6,750) | (3,349) | (10,230) |
Repurchases of common stock | (405) | 0 | (1,071) | 0 |
Intercompany advances, net | 0 | 0 | 0 | 0 |
Equity investment from parent | 0 | 0 | 0 | 0 |
Tax withholdings on share-based awards | (10) | (3) | (84) | (95) |
Cash payments for debt prepayment or debt extinguishment costs | (181) | (159) | (212) | (188) |
Intercompany dividend paid | 0 | 0 | 0 | 0 |
Dividends on preferred stock | 0 | (14) | 0 | (28) |
Other, net | (3) | (3) | 0 | 16 |
Net cash used in financing activities | (3,267) | (2,175) | (2,267) | (366) |
Change in cash and cash equivalents | (2,312) | (7,320) | (1,004) | (5,319) |
Beginning of period | 2,527 | 7,501 | 1,219 | 5,500 |
End of period | 215 | 181 | 215 | 181 |
Consolidating and Eliminating Adjustments | ||||
Operating activities | ||||
Net cash provided by (used in) operating activities | (130) | (80) | (130) | (80) |
Investing activities | ||||
Purchases of property and equipment | 0 | 0 | 0 | 0 |
Purchases of spectrum licenses and other intangible assets, including deposits | 0 | 0 | 0 | 0 |
Proceeds related to beneficial interests in securitization transactions | 0 | 0 | 0 | 0 |
Acquisition of companies, net of cash acquired | 0 | 0 | ||
Equity investment in subsidiary | 26 | 308 | 26 | 308 |
Other, net | 0 | 0 | 0 | 0 |
Net cash used in investing activities | 26 | 308 | 26 | 308 |
Financing activities | ||||
Proceeds from issuance of long-term debt | 0 | 0 | 0 | 0 |
Payments of consent fees related to long-term debt | 0 | 0 | ||
Proceeds from borrowing on revolving credit facility | 0 | 0 | 0 | 0 |
Repayments of revolving credit facility | 0 | 0 | 0 | 0 |
Repayments of capital lease obligations | 0 | 0 | 0 | 0 |
Repayments of short-term debt for purchases of inventory, property and equipment, net | 0 | 0 | ||
Repayments of long-term debt | 0 | 0 | 0 | 0 |
Repurchases of common stock | 0 | 0 | ||
Intercompany advances, net | 0 | 0 | 0 | 0 |
Equity investment from parent | (26) | (308) | (26) | (308) |
Tax withholdings on share-based awards | 0 | 0 | 0 | 0 |
Cash payments for debt prepayment or debt extinguishment costs | 0 | 0 | 0 | 0 |
Intercompany dividend paid | 130 | 80 | 130 | 80 |
Dividends on preferred stock | 0 | 0 | ||
Other, net | 0 | 0 | 0 | 0 |
Net cash used in financing activities | 104 | (228) | 104 | (228) |
Change in cash and cash equivalents | 0 | 0 | 0 | 0 |
Beginning of period | 0 | 0 | 0 | 0 |
End of period | 0 | 0 | 0 | 0 |
Parent | Reportable Legal Entities | ||||
Operating activities | ||||
Net cash provided by (used in) operating activities | (1) | 1 | 0 | 2 |
Investing activities | ||||
Purchases of property and equipment | 0 | 0 | 0 | 0 |
Purchases of spectrum licenses and other intangible assets, including deposits | 0 | 0 | 0 | 0 |
Proceeds related to beneficial interests in securitization transactions | 0 | 0 | 0 | 0 |
Acquisition of companies, net of cash acquired | 0 | 0 | ||
Equity investment in subsidiary | 0 | (308) | 0 | (308) |
Other, net | 0 | 0 | 0 | 0 |
Net cash used in investing activities | 0 | (308) | 0 | (308) |
Financing activities | ||||
Proceeds from issuance of long-term debt | 0 | 0 | 0 | 0 |
Payments of consent fees related to long-term debt | 0 | 0 | ||
Proceeds from borrowing on revolving credit facility | 0 | 0 | 0 | 0 |
Repayments of revolving credit facility | 0 | 0 | 0 | 0 |
Repayments of capital lease obligations | 0 | 0 | 0 | 0 |
Repayments of short-term debt for purchases of inventory, property and equipment, net | 0 | 0 | ||
Repayments of long-term debt | 0 | 0 | 0 | 0 |
Repurchases of common stock | (405) | (1,071) | ||
Intercompany advances, net | 405 | 0 | 995 | 0 |
Equity investment from parent | 0 | 0 | 0 | 0 |
Tax withholdings on share-based awards | 0 | 0 | 0 | 0 |
Cash payments for debt prepayment or debt extinguishment costs | 0 | 0 | 0 | 0 |
Intercompany dividend paid | 0 | 0 | 0 | 0 |
Dividends on preferred stock | (14) | (28) | ||
Other, net | 1 | 4 | 3 | 19 |
Net cash used in financing activities | 1 | (10) | (73) | (9) |
Change in cash and cash equivalents | 0 | (317) | (73) | (315) |
Beginning of period | 1 | 360 | 74 | 358 |
End of period | 1 | 43 | 1 | 43 |
Issuer | Reportable Legal Entities | ||||
Operating activities | ||||
Net cash provided by (used in) operating activities | (258) | (795) | (662) | (929) |
Investing activities | ||||
Purchases of property and equipment | 0 | 0 | 0 | 0 |
Purchases of spectrum licenses and other intangible assets, including deposits | 0 | 0 | 0 | 0 |
Proceeds related to beneficial interests in securitization transactions | 0 | 0 | 0 | 0 |
Acquisition of companies, net of cash acquired | 0 | 0 | ||
Equity investment in subsidiary | 0 | 0 | 0 | 0 |
Other, net | 0 | 0 | 0 | 0 |
Net cash used in investing activities | 0 | 0 | 0 | 0 |
Financing activities | ||||
Proceeds from issuance of long-term debt | 0 | 4,485 | 2,494 | 9,980 |
Payments of consent fees related to long-term debt | 0 | 0 | ||
Proceeds from borrowing on revolving credit facility | 2,070 | 1,855 | 4,240 | 1,855 |
Repayments of revolving credit facility | 0 | 0 | 0 | 0 |
Repayments of capital lease obligations | 0 | 0 | 0 | 0 |
Repayments of short-term debt for purchases of inventory, property and equipment, net | 0 | 0 | ||
Repayments of long-term debt | 0 | 0 | 0 | 0 |
Repurchases of common stock | 0 | 0 | ||
Intercompany advances, net | (1,810) | (8,990) | (6,070) | (13,946) |
Equity investment from parent | 0 | 308 | 0 | 308 |
Tax withholdings on share-based awards | 0 | 0 | 0 | 0 |
Cash payments for debt prepayment or debt extinguishment costs | 0 | 0 | 0 | 0 |
Intercompany dividend paid | 0 | 0 | 0 | 0 |
Dividends on preferred stock | 0 | 0 | ||
Other, net | 0 | 0 | 0 | 0 |
Net cash used in financing activities | 260 | (2,342) | 664 | (1,803) |
Change in cash and cash equivalents | 2 | (3,137) | 2 | (2,732) |
Beginning of period | 1 | 3,138 | 1 | 2,733 |
End of period | 3 | 1 | 3 | 1 |
Guarantor Subsidiaries | Reportable Legal Entities | ||||
Operating activities | ||||
Net cash provided by (used in) operating activities | 2,932 | 2,816 | 5,306 | 4,671 |
Investing activities | ||||
Purchases of property and equipment | (1,624) | (1,347) | (2,990) | (2,875) |
Purchases of spectrum licenses and other intangible assets, including deposits | (28) | (5,791) | (79) | (5,805) |
Proceeds related to beneficial interests in securitization transactions | 12 | 11 | 25 | 21 |
Acquisition of companies, net of cash acquired | (5) | (338) | ||
Equity investment in subsidiary | (26) | 0 | (26) | 0 |
Other, net | 33 | 5 | 26 | (3) |
Net cash used in investing activities | (1,638) | (7,122) | (3,382) | (8,662) |
Financing activities | ||||
Proceeds from issuance of long-term debt | 0 | 0 | 0 | 0 |
Payments of consent fees related to long-term debt | (38) | (38) | ||
Proceeds from borrowing on revolving credit facility | 0 | 0 | 0 | 0 |
Repayments of revolving credit facility | (2,195) | (1,175) | (3,920) | (1,175) |
Repayments of capital lease obligations | (154) | (119) | (326) | (209) |
Repayments of short-term debt for purchases of inventory, property and equipment, net | (292) | (292) | ||
Repayments of long-term debt | (2,350) | (6,750) | (3,349) | (10,230) |
Repurchases of common stock | 0 | 0 | ||
Intercompany advances, net | 1,406 | 8,995 | 5,085 | 13,962 |
Equity investment from parent | 0 | 0 | 0 | 0 |
Tax withholdings on share-based awards | (10) | (3) | (84) | (95) |
Cash payments for debt prepayment or debt extinguishment costs | (181) | (159) | (212) | (188) |
Intercompany dividend paid | 0 | 0 | 0 | 0 |
Dividends on preferred stock | 0 | 0 | ||
Other, net | (4) | (7) | (3) | (3) |
Net cash used in financing activities | (3,526) | 490 | (2,847) | 1,770 |
Change in cash and cash equivalents | (2,232) | (3,816) | (923) | (2,221) |
Beginning of period | 2,395 | 3,937 | 1,086 | 2,342 |
End of period | 163 | 121 | 163 | 121 |
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||||
Operating activities | ||||
Net cash provided by (used in) operating activities | (1,282) | (836) | (2,483) | (1,950) |
Investing activities | ||||
Purchases of property and equipment | (5) | 0 | (5) | 0 |
Purchases of spectrum licenses and other intangible assets, including deposits | 0 | 0 | 0 | 0 |
Proceeds related to beneficial interests in securitization transactions | 1,311 | 871 | 2,593 | 1,995 |
Acquisition of companies, net of cash acquired | 0 | 0 | ||
Equity investment in subsidiary | 0 | 0 | 0 | 0 |
Other, net | 0 | 0 | 0 | 0 |
Net cash used in investing activities | 1,306 | 871 | 2,588 | 1,995 |
Financing activities | ||||
Proceeds from issuance of long-term debt | 0 | 0 | 0 | 0 |
Payments of consent fees related to long-term debt | 0 | 0 | ||
Proceeds from borrowing on revolving credit facility | 0 | 0 | 0 | 0 |
Repayments of revolving credit facility | 0 | 0 | 0 | 0 |
Repayments of capital lease obligations | (1) | 0 | (1) | 0 |
Repayments of short-term debt for purchases of inventory, property and equipment, net | 0 | 0 | ||
Repayments of long-term debt | 0 | 0 | 0 | 0 |
Repurchases of common stock | 0 | 0 | ||
Intercompany advances, net | (1) | (5) | (10) | (16) |
Equity investment from parent | 26 | 0 | 26 | 0 |
Tax withholdings on share-based awards | 0 | 0 | 0 | 0 |
Cash payments for debt prepayment or debt extinguishment costs | 0 | 0 | 0 | 0 |
Intercompany dividend paid | (130) | (80) | (130) | (80) |
Dividends on preferred stock | 0 | 0 | ||
Other, net | 0 | 0 | 0 | 0 |
Net cash used in financing activities | (106) | (85) | (115) | (96) |
Change in cash and cash equivalents | (82) | (50) | (10) | (51) |
Beginning of period | 130 | 66 | 58 | 67 |
End of period | $ 48 | $ 16 | $ 48 | $ 16 |