DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 10, 2016 | Jun. 30, 2015 | |
Document And Entity Information [Abstract] | |||
Document type | 10-K | ||
Amendment flag | false | ||
Document period end date | Dec. 31, 2015 | ||
Document fiscal year focus | 2,015 | ||
Document fiscal period focus | FY | ||
Trading symbol | TWC | ||
Entity registrant name | TIME WARNER CABLE INC. | ||
Entity central index key | 1,377,013 | ||
Current fiscal year end date | --12-31 | ||
Entity current reporting status | Yes | ||
Entity well known seasoned issuer | Yes | ||
Entity voluntary filers | No | ||
Entity filer category | Large Accelerated Filer | ||
Entity public float | $ 50.4 | ||
Entity common stock shares outstanding | 283,270,372 |
CONSOLIDATED BALANCE SHEET
CONSOLIDATED BALANCE SHEET - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and equivalents | $ 1,170 | $ 707 |
Receivables, less allowances of $94 million and $109 million as of December 31, 2015 and 2014, respectively | 916 | 949 |
Other current assets | 373 | 383 |
Total current assets | 2,459 | 2,039 |
Investments | 65 | 64 |
Property, plant and equipment, net | 16,945 | 15,990 |
Intangible assets subject to amortization, net | 437 | 523 |
Intangible assets not subject to amortization | 26,014 | 26,012 |
Goodwill | 3,139 | 3,137 |
Other assets | 218 | 370 |
Total assets | 49,277 | 48,135 |
Current liabilities: | ||
Accounts payable | 656 | 567 |
Deferred revenue and subscriber-related liabilities | 224 | 198 |
Accrued programming and content expense | 985 | 902 |
Current maturities of long-term debt | 5 | 1,017 |
Other current liabilities | 2,079 | 1,813 |
Total current liabilities | 3,949 | 4,497 |
Long-term debt | 22,497 | 22,604 |
Deferred income tax liabilities, net | 12,830 | 12,291 |
Other liabilities | $ 1,002 | $ 726 |
Commitments and contingencies (Note 17) | ||
TWC shareholders' equity: | ||
Common stock, $0.01 par value, 283.3 million and 280.8 million shares issued and outstanding as of December 31, 2015 and 2014, respectively | $ 3 | $ 3 |
Additional paid-in capital | 7,481 | 7,172 |
Retained earnings | 1,925 | 1,162 |
Accumulated other comprehensive loss, net | (414) | (324) |
Total TWC shareholders' equity | 8,995 | 8,013 |
Noncontrolling interests | 4 | 4 |
Total equity | 8,999 | 8,017 |
Total liabilities and equity | $ 49,277 | $ 48,135 |
CONSOLIDATED BALANCE SHEET (Par
CONSOLIDATED BALANCE SHEET (Parentheticals) - USD ($) shares in Millions, $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Current assets: | ||||
Allowance for doubtful accounts | $ 94 | $ 109 | $ 77 | $ 65 |
TWC shareholders' equity: | ||||
Common stock par value per share (in US dollars per share) | $ 0.01 | $ 0.01 | ||
Common stock shares issued (in shares) | 283.3 | 280.8 | ||
Common stock shares outstanding (in shares) | 283.3 | 280.8 | 277.9 | 297.7 |
CONSOLIDATED STATEMENT OF OPERA
CONSOLIDATED STATEMENT OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Consolidated Statement Of Operations [Abstract] | |||||||||||||||
Revenue | $ 23,697 | $ 22,812 | $ 22,120 | ||||||||||||
Costs and expenses: | |||||||||||||||
Programming and content | 5,815 | 5,294 | 4,950 | ||||||||||||
Sales and marketing | 2,379 | 2,192 | 2,048 | ||||||||||||
Technical operations | 1,669 | 1,530 | 1,500 | ||||||||||||
Customer care | 900 | 839 | 766 | ||||||||||||
Other operating | 4,796 | 4,729 | 4,876 | ||||||||||||
Depreciation | 3,560 | 3,236 | 3,155 | ||||||||||||
Amortization | 136 | 135 | 126 | ||||||||||||
Merger-related and restructuring costs | 203 | 225 | 119 | ||||||||||||
Total costs and expenses | 19,458 | 18,180 | 17,540 | ||||||||||||
Operating Income | 4,239 | 4,632 | 4,580 | ||||||||||||
Interest expense, net | (1,401) | (1,419) | (1,552) | ||||||||||||
Other income, net | 150 | 35 | 11 | ||||||||||||
Income before income taxes | 2,988 | 3,248 | 3,039 | ||||||||||||
Income tax provision | (1,144) | (1,217) | (1,085) | ||||||||||||
Net income | 1,844 | 2,031 | 1,954 | ||||||||||||
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | ||||||||||||
Net income attributable to TWC shareholders | $ 1,844 | $ 2,031 | $ 1,954 | ||||||||||||
Net income per common share attributable to TWC common shareholders - basic (in US dollars per share) | $ 6.46 | $ 7.21 | $ 6.76 | ||||||||||||
Net income per common share attributable to TWC common shareholders - diluted (in US dollars per share) | $ 6.44 | $ 7.17 | $ 6.70 | ||||||||||||
Weighted-average common shares outstanding - basic (in shares) | 282.6 | 279.3 | 287.6 | ||||||||||||
Weighted-average common shares outstanding - diluted (in shares) | 285.9 | 283 | 291.7 | ||||||||||||
Cash dividends declared per share of common stock (in US dollars per share) | $ 0.75 | $ 0.75 | $ 0.75 | $ 1.50 | $ 0.75 | $ 0.75 | $ 0.75 | $ 0.75 | $ 0.65 | $ 0.65 | $ 0.65 | $ 0.65 | $ 3.75 | $ 3 | $ 2.60 |
CONSOLIDATED STATEMENT OF COMPR
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Consolidated Statement Of Comprehensive Income [Abstract] | |||
Net income | $ 1,844 | $ 2,031 | $ 1,954 |
Change in accumulated unrealized losses on pension benefit obligation, net of income tax benefit (provision) of $24 million in 2015, $230 million in 2014 and $(377) million in 2013 | (39) | (369) | 604 |
Change in accumulated deferred gains (losses) on cash flow hedges, net of income tax benefit (provision) of $30 million in 2015, $(1) million in 2014 and $(66) million in 2013 | (50) | 1 | 104 |
Other changes | (1) | 0 | (1) |
Other comprehensive income (loss) | (90) | (368) | 707 |
Comprehensive income | 1,754 | 1,663 | 2,661 |
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | 0 |
Comprehensive income attributable to TWC shareholders | $ 1,754 | $ 1,663 | $ 2,661 |
CONSOLIDATED STATEMENT OF COMP6
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Parentheticals) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Consolidated Statement Of Comprehensive Income [Abstract] | |||
Change in accumulated unrealized losses on pension benefit obligation, tax effect | $ 24 | $ 230 | $ (377) |
Change in accumulated deferred gains (losses) on cash flow hedges, tax effect | $ 30 | $ (1) | $ (66) |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
OPERATING ACTIVITIES | |||
Net income | $ 1,844 | $ 2,031 | $ 1,954 |
Adjustments for noncash and nonoperating items: | |||
Depreciation | 3,560 | 3,236 | 3,155 |
Amortization | 136 | 135 | 126 |
Pretax gain on settlement of Verizon Wireless agency agreement | (120) | 0 | 0 |
Deferred income taxes | 593 | 756 | 363 |
Equity-based compensation expense | 161 | 182 | 128 |
Excess tax benefit from equity-based compensation | (92) | (141) | (93) |
Changes in operating assets and liabilities, net of acquisitions and dispositions: | |||
Receivables | 53 | 11 | (23) |
Accounts payable and other liabilities | 360 | 91 | 167 |
Other changes | 44 | 49 | (24) |
Cash provided by operating activities | 6,539 | 6,350 | 5,753 |
INVESTING ACTIVITIES | |||
Capital expenditures | (4,446) | (4,097) | (3,198) |
Business acquisitions, net of cash acquired | 0 | 0 | (423) |
Purchases of investments | (4) | (2) | (588) |
Proceeds from sale, maturity and collection of investments | 3 | 19 | 726 |
Acquisition of intangible assets | (51) | (39) | (40) |
Other investing activities | 153 | 27 | 47 |
Cash used by investing activities | (4,345) | (4,092) | (3,476) |
FINANCING ACTIVITIES | |||
Short-term borrowings (repayments), net | (507) | 507 | 0 |
Repayments of long-term debt | (500) | (1,750) | (1,500) |
Repayments of long-term debt assumed in acquisitions | 0 | 0 | (138) |
Redemption of mandatorily redeemable preferred equity | 0 | 0 | (300) |
Dividends paid | (865) | (857) | (758) |
Repurchases of common stock | 0 | (259) | (2,509) |
Proceeds from exercise of stock options | 129 | 226 | 138 |
Excess tax benefit from equity-based compensation | 92 | 141 | 93 |
Taxes paid in cash in lieu of shares issued for equity-based compensation | (72) | (76) | (68) |
Other financing activities | (8) | (8) | (14) |
Cash used by financing activities | (1,731) | (2,076) | (5,056) |
Increase (decrease) in cash and equivalents | 463 | 182 | (2,779) |
Cash and equivalents at beginning of year | 707 | 525 | 3,304 |
Cash and equivalents at end of year | $ 1,170 | $ 707 | $ 525 |
CONSOLIDATED STATEMENT OF EQUIT
CONSOLIDATED STATEMENT OF EQUITY - USD ($) $ in Millions | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss), Net [Member] | Noncontrolling Interests [Member] |
Balance at beginning of year at Dec. 31, 2012 | $ 7,283 | $ 3 | $ 7,576 | $ 363 | $ (663) | $ 4 |
Net income | 1,954 | 0 | 0 | 1,954 | 0 | 0 |
Other comprehensive income (loss) | 707 | 0 | 0 | 0 | 707 | 0 |
Cash dividends declared ($2.60 per share in 2013, $3.00 per share in 2014 and $3.75 per share in 2015) | (758) | 0 | (453) | 0 | 0 | |
Cash dividends declared, portion in excess of retained earnings ($2.60 per share in 2013, $3.00 per share in 2014 and $3.75 per share in 2015) | (305) | |||||
Repurchase and retirement of common stock | (2,526) | 0 | (608) | (1,918) | 0 | 0 |
Equity-based compensation expense | 128 | 0 | 128 | 0 | 0 | 0 |
Excess tax benefit realized from equity-based compensation | 92 | 0 | 92 | 0 | 0 | 0 |
Shares issued upon exercise of stock options | 138 | 0 | 138 | 0 | 0 | 0 |
Taxes paid in lieu of shares issued for equity-based compensation | (68) | 0 | (68) | 0 | 0 | 0 |
Other changes | (3) | 0 | (2) | (1) | 0 | 0 |
Balance at end of year at Dec. 31, 2013 | 6,947 | 3 | 6,951 | (55) | 44 | 4 |
Net income | 2,031 | 0 | 0 | 2,031 | 0 | 0 |
Other comprehensive income (loss) | (368) | 0 | 0 | 0 | (368) | 0 |
Cash dividends declared ($2.60 per share in 2013, $3.00 per share in 2014 and $3.75 per share in 2015) | (857) | 0 | (644) | 0 | 0 | |
Cash dividends declared, portion in excess of retained earnings ($2.60 per share in 2013, $3.00 per share in 2014 and $3.75 per share in 2015) | (213) | |||||
Repurchase and retirement of common stock | (208) | 0 | (39) | (169) | 0 | 0 |
Equity-based compensation expense | 182 | 0 | 182 | 0 | 0 | 0 |
Excess tax benefit realized from equity-based compensation | 141 | 0 | 141 | 0 | 0 | 0 |
Shares issued upon exercise of stock options | 226 | 0 | 226 | 0 | 0 | 0 |
Taxes paid in lieu of shares issued for equity-based compensation | (76) | 0 | (76) | 0 | 0 | 0 |
Other changes | (1) | 0 | 0 | (1) | 0 | 0 |
Balance at end of year at Dec. 31, 2014 | 8,017 | 3 | 7,172 | 1,162 | (324) | 4 |
Net income | 1,844 | 0 | 0 | 1,844 | 0 | 0 |
Other comprehensive income (loss) | (90) | 0 | 0 | 0 | (90) | 0 |
Cash dividends declared ($2.60 per share in 2013, $3.00 per share in 2014 and $3.75 per share in 2015) | (1,081) | 0 | 0 | (1,081) | 0 | 0 |
Equity-based compensation expense | 161 | 0 | 161 | 0 | 0 | 0 |
Excess tax benefit realized from equity-based compensation | 92 | 0 | 92 | 0 | 0 | 0 |
Shares issued upon exercise of stock options | 129 | 0 | 129 | 0 | 0 | 0 |
Taxes paid in lieu of shares issued for equity-based compensation | (72) | 0 | (72) | 0 | 0 | 0 |
Other changes | (1) | 0 | (1) | 0 | 0 | 0 |
Balance at end of year at Dec. 31, 2015 | $ 8,999 | $ 3 | $ 7,481 | $ 1,925 | $ (414) | $ 4 |
CONSOLIDATED STATEMENT OF EQUI9
CONSOLIDATED STATEMENT OF EQUITY (Parentheticals) - $ / shares | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Consolidated Statement Of Equity [Abstract] | |||||||||||||||
Cash dividends declared per share of common stock (in US dollars per share) | $ 0.75 | $ 0.75 | $ 0.75 | $ 1.50 | $ 0.75 | $ 0.75 | $ 0.75 | $ 0.75 | $ 0.65 | $ 0.65 | $ 0.65 | $ 0.65 | $ 3.75 | $ 3 | $ 2.60 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 12 Months Ended |
Dec. 31, 2015 | |
Description Of Business And Basis Of Presentation Disclosure [Abstract] | |
Description of Business and Basis of Presentation Disclosure | 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Description of Business Time Warner Cable Inc. (together with its subsidiaries, “TWC” or the “Company”) is among the largest providers of video, high-speed data and voice services in the U.S., with technologically advanced, well-clustered cable systems located mainly in five geographic areas – New York State (including New York City), the Carolinas, the Midwest (including Ohio, Kentucky and Wisconsin), Southern California (including Los Angeles) and Texas. TWC's mission is to connect its customers to the world—simply, reliably and with superior service. TWC offers video, high-speed data and voice services to residential and business services customers. TWC's residential services also include security and home management services, and TWC's business services also include networking and transport services (including cell tower backhaul services) and enterprise-class, cloud-enabled hosting, managed applications and services. TWC also sells video and online advertising inventory to a variety of local , regional and national customers . Charter Merger On May 23, 2015, TWC entered into an Agreement and Plan of Mergers (the “Charter Merger Agreement”) with Charter Communications, Inc. (“Charter”) and certain of its subsidiaries, pursuant to which the parties will engage in a series of transactions (the “Charter merger”) that will result in the Company and Charter becoming 100% owned subsidiaries of a new public parent company (“ New Charter ”) , on the terms and subject to the conditions set forth in the Charter Merger Agreement. Upon the consummation of the Charter merger, each share of TWC common stock (other than treasury shares held by the Company and TWC stock held by the Liberty Parties (as defined below)) will be converted into the right to receive , at the option of each stockholder, either ( i ) $100 in cash and shares of New Charter Class A common stock equivalent to 0.5409 shares of Charter Class A common stock (“Charter common stock”) or (ii) $115 in cash and shares of New Charter Class A common stock equivalent to 0.4562 shares of Charter common stock. Upon the consummation of the Charter merger, subject to certain exceptions, each share of TWC common stock held by Liberty Broadband Corporation or Liberty Interactive Corporation (together, the “Liberty Parties”) will convert only into the right to receive shares of New Charter Class A common stock. On September 21, 2015, the Company's stockholders approved the adoption of the Charter Merger Agreement, and Charter's stockholders approved, among other things, the adoption of the Charter Merger Agreement and the issuance of New Charter Class A common stock to TWC stockholders in the Charter merger. The Charter merger is subject to regulatory approvals and certain other closing conditions. Bright House Networks Transaction On May 23, 2015, Charter and Advance/Newhouse Partnership (“A/N”) and certain of their affiliates amended an agreement the parties had signed on March 31, 2015 (the “Bright House Networks Agreement”). Under the amended Bright House Networks Agreement, Charter will acquire Bright House Networks, LLC (“Bright House Networks”), subject to, among other conditions, the closing of the Charter merger. Bright House Networks is a 100% owned subsidiary of a partnership (“TWE-A/N”) between A/N and Time Warner Cable Enterprises LLC (“TWCE”), a subsidiary of TWC. The closing of Charter's acquisition of Bright House Networks is expected to occur concurrently with the closing of the Charter merger. However, the closing of the Charter merger is not conditioned on the closing of the Bright House Networks transaction. In the Charter Merger Agreement, the Company and TWCE agreed to irrevocably and unconditionally waive their “right of first offer” to acquire the assets of Bright House Networks during the pendency of the Charter merger. This waiver will expire if the Charter Merger Agreement is terminated in accordance with its terms, provided that the Company or any of its Affiliates (as defined in the Charter Merger Agreement) does not, within nine months following such a termination, enter into an agreement or understanding in respect of, or consummate, an alternative acquisition transaction. TWC receives a fee from A/N for providing Bright House Networks with high-speed data services and certain management functions, which is included in Other Operations revenue. Termination of Comcast Merger On April 24, 2015, Comcast Corporation (“Comcast”) and the Company terminated their February 12, 2014 Agreement and Plan of Merger (the “Comcast Merger Agreement”), under which the Company had agreed , on the terms and subject to the conditions set forth therein, to merge with and into a 100% owned subsidiary of Comcast. Basis of Presentation Changes in Basis of Presentation As discussed more fully in Note 2 , during the fourth quarter of 2015, TWC elected to early adopt authoritative guidance issued by the Financial Accounting Standards Board (the “FASB”) related to the presentation of deferred income taxes and debt issuance costs. As required by this guidance, the Company has recast the consolidated balance sheet as of December 31, 2014, the consolidated statement of cash flows for the years ended December 31, 2014 and 2013 and certain related footnotes so that they ar e comparable to those of 2015. Basis of Consolidation T he consolidated financial statements include all of the assets, liabilities, revenue, expenses and cash flows of TWC and all entities in which TWC has a controlling voting interest. T he consolidated financial statements include the results of TWE-A/N only for the TWE-A/N cable systems that are controlled by TWC and for which TWC holds an economic interest. Intercompany accounts and transactions between consolidated companies have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and footnotes thereto. Actual results could differ from those estimates. Significant estimates inherent in the preparation of the consolidated financial statements include accounting for allowances for doubtful accounts, depreciation and amortization, business combinations, derivative financial instruments, pension benefits, equity-based compensation, income taxes, loss contingencies , certain programming arrangements and asset impairments . Allocation methodologies used to prepare the consolidated financial statements are based on estimates and have been described in the notes, where appropriate. Reclassifications Certain reclassifications have been made to the prior year financial information to conform to the current year presentation , including adoption of two recent accounting standards as further deta iled in Note 2 . |
RECENT ACCOUNTING STANDARDS
RECENT ACCOUNTING STANDARDS | 12 Months Ended |
Dec. 31, 2015 | |
Recent Accounting Standards Disclosure [Abstract] | |
Recent Accounting Standards Disclosure | 2. RECENT ACCOUNTING STANDARDS Accounting Standards Adopted in 2015 Presentation of Deferred Income Taxes In November 2015, the FASB issued authoritative guidance for the purpose of simplifying the presentation of de ferred income taxes . Under this guidance, de ferred income tax assets and liabilities are required to be presented as noncurrent in the balance sheet. The current requirement that deferred income tax assets and liabilities be offset and presented as a single amount is not affected by this guidance. TWC elected to early adopt this guidance during the fourth quarter of 2015 and has applied a full retrospective approach to all periods presented. Current deferred income tax assets of $269 million as of December 31, 2014 have been reclassified and presented as a reduction to deferred income tax liabilities, net, in the consolidated balance sheet. Presentation of Debt Issuance Costs In April 2015, the FASB issued authoritative guidance for the purpose of simplifying the presentation of debt issuance costs. Under this guidance, debt issuance costs related to a recognized debt liability are required to be presented in the balance sheet as a direct reduction from the carrying amount of such debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by this guidance. TWC elected to early adopt this guidance during the fourth quarter of 2015 and has applied a full retrospective approach to all periods presented. Debt issuance costs, net of accumulated amortization, of $8 million and $89 million recognized in other current assets and other assets, respectively, as of December 31, 2014 have been reclassified and presented as a reduction to long-term debt in the consolidated balance s heet. Accounting Standards Not Yet Adopted Recognition and Measurement of Financial Assets and Liabilities In January 2016, the FASB issued authoritative guidance for the purpose of improving certain aspects of the recognition, measurement, presentation and disclosure of financial instruments. Among other things, this guidance requires public entities to measure equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) at fair value with changes in fair value recognized in net income and to perform a qualitative assessment to identify impairment for equity investments without readily determinable fair values. Entities are required to apply th is guidance by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption and, for the guidance related to equity securities without readily determinable fair values, entities are required to apply a prospective approach to equity investments that exist as of the date of adoption. This guidance will be effective for TWC on January 1, 2018 and is not expected to have a material impact on the Company's consolidated financial statements. Revenue from Contracts with Customers In May 2014, the FASB issued authoritative guidance that outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most recent current revenue recognition guidance, including industry-specific guidance. The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also specifies the accounting for certain incremental costs of obtaining a contract and costs to fulfill a contract with a customer. Entities have the option of applying either a full retrospective approach to all periods presented or a modified approach that reflects differences prior to the date of adoption as an adjustment to equity. In July 2015, the FASB deferred the effective date of this guidance by one year. As such, this guidance will be effective for TWC on January 1, 2018 and the Company is currently assessing the impact of this guidance on its consolidated financial statements. Customer's Accounting for Fees Paid in a Cloud Computing Arrangement In April 2015, the FASB issued authoritative guidance for the purpose of clarifying the accounting for cloud computing arrangements by providing criteria for determining whether a cloud computing arrangement includes a software license. Under this guidance, if it is determined that a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses; however, if it is determined that a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. Entities have the option of applying either a full retrospective approach to all periods presented or a prospective approach to all arrangements entered into or materially modified after the effective date. This guidance will be effective for TWC on January 1, 2016 and is not expected to have a material impact on the Company's consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2015 | |
Summary Of Significant Accounting Policies Disclosure [Abstract] | |
Summary of Significant Accounting Policies Disclosure | 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Cash and Equivalents Cash and equivalents include money market funds, overnight deposits and other investments that are readily convertible into cash and have origin al maturities of three months or less. Cash equivalents are carried at cost, which approximates fair value. Accounts Receivable Accounts receivable are recorded at net realizable value. A n allowance for doubtful accounts is maintained , which is determined after considering past collection experience, aging of accounts receivable, general economic factors and other considerations . Accounts receivable are written off when it is determined that the balance owed will not be collected, based on the age of the receivable and other considerations . Changes in the allowance for doubtful accounts from January 1 through December 31 are presented below (in millions): 2015 2014 2013 Balance at beginning of year $ 109 $ 77 $ 65 Provision for bad debts (a) 212 275 249 Write-offs, net of recoveries (227) (243) (237) Balance at end of year $ 94 $ 109 $ 77 —————————— Provision for bad debts includes amounts charged to expense associated with the allowance for doubtful accounts and excludes collection expenses and the benefit from l ate fees billed to subscribers. Investments Investments in companies in which TWC has significant influence, but less than a controlling interest, are accounted for using the equity method of accounting . Under the equity method of accounting, only TWC's investment in and amounts due to and from the equity investee are included in the consolidated balance sheet; only TWC's share of the investee's earnings (losses) is included in the consolidated statement of operations; and only the dividends, cash distributions, loans or other cash received from the investee, additional cash investments, loan repayments or other cash paid to the investee are included in the consolidated statement of cash flows. Property, Plant and Equipment Property, plant and equipment are stated at cost , and depreciation on these assets is provided using the straight-line method over their estimated useful lives . Costs associated with the construction of transmission and distribution facilities are capitalized. With respect to customer premise equipment, which includes set-top boxes and high-speed data and telephone modems, installation costs are capitalized only upon the initial deployment of these assets. All costs incurred in subsequent disconnects and reconnects of previously installed customer premise equipment are expensed as incurred . Standard capitalization rates are used to capitalize installation activities. Significant judgment is involved in the development of these capitalization standards, including the average time required to perform an installation and the determination of the nature and amount of indirect costs to be capitalized. The capitalization standards are reviewed at least annually and adjusted, if necessary, based on comparisons to actual costs incurred. G enerally , expenditures for tangible fixed assets having a useful life of greater than one year are capitalized . Capitalized costs include direct material, labor and overhead, as well as interest . T he costs associated with the repair and maint enance of existing tangible fixed assets are expensed as incurred. P roperty, plant and equipment and related accumulated depreciation a s of December 31, 2015 and 2014 consisted of the following : Estimated December 31, Useful 2015 2014 Lives (in millions) (in years) Land, buildings and improvements (a) $ 2,093 $ 2,038 1-20 Distribution systems (b) 27,126 24,951 3-25 Converters and modems 6,743 6,141 3-5 Capitalized software costs (c) 2,924 2,572 3-5 Vehicles and other equipment 2,466 2,374 3-10 Construction in progress 424 476 Property, plant and equipment, gross 41,776 38,552 Accumulated depreciation (24,831) (22,562) Property, plant and equipment, net $ 16,945 $ 15,990 —————————— Land, buildings and improvements includes $174 million and $173 million related to land as of December 31, 2015 and 2014 , respectively, which is not depreciated. The weighted-average useful life for buildings and improvements is approximately 17.73 years. The weighted-average useful li fe for distribution systems is approximately 13.22 years . Capitalized software costs reflect certain costs incurred for the development of internal use software, including costs associated with coding, software configuration, upgrades and enhancements. These costs, net of accumulated depreciation, totaled $807 million and $803 million as of December 31, 2015 and 2014 , respectively. Depreciation of capitalized software costs was $361 million in 2015 , $317 million in 2014 and $270 million in 2013 . Intangible Assets and Goodwill F inite- lived intangible assets consist primarily of customer relationships , ca ble franchise renewals and access rights . Acquired customer relationships are capitalized and amortized over their estimated useful lives and costs to negotiate and renew cable franchise rights are capitalized and amortized over the term of the new franchise agreement. I ndefinite-lived intangible assets consist of cable franchise rights that are acquired in an acquisition of a business. Goodwill is recorded for the excess of the acquisition cost of an acquired entity over the estimated fair value of the ide ntifiable net assets acquired. C able franchise rights and goodwill are not amortized . Fair Value Estimates Business Combinations Upon the acquisition of a business, the fair value of the assets acquired and liabilities assumed must be estimated . This requires judgments regarding the identification of acquired assets and liabilities assumed, some of which may not have been previously recorded by the acquired business, as well as judgments regarding the valuation of all identified acquired assets and assumed liabilities. The assets acquired and liabilities assumed are determined by reviewing the operations, interviewing management and reviewing the financial, contractual and regulatory information of the acquired business. Once the acquired assets and assumed liabilities are identified, the fair values of the assets and liabilities are estimated using a variety of approaches that require significant judgments. For example, intangible assets are typically valued using a discounted cash flow (“DCF”) analysis, which requires estimates of the future cash flows that are attributable to the intangible asset. A DCF analysis also requires significant judgments regarding the selection of discount rates that are intended to reflect the risks that are inherent in the projected cash flows, the determination of terminal growth rates, and judgments about the useful life and pattern of use of the underlying intangible asset. As another example, the valuation of acquired property, plant and equipment requires judgments about current market values, replacement costs, the physical and functional obsolescence of the asset s and their remaining useful li ves . A failure to appropriately assign fair values to acquired assets and assumed liabilities could significantly impact the amount and timing of future depreciation and amortization expense, as well as significantly overstate or understate assets or liabilities. Derivative Financial Instruments D erivative financial instruments are recognized in the consolidated balance sheet as either assets or liabilities at fair value and are designated, if certain conditions are met, as either (a) a hedge of the exposure to changes in the fair value of a recognized asset or liability or an unrecognized firm commitment (a “fair value hedge”) or (b) a hedge of the exposure to variable cash flows of a forecasted transaction or a hedge of the foreign currency exposure of a forecasted transaction denominated in a foreign currency (a “cash flow hedge”). For a derivative financial instrument designated as a fair value hedge (e.g., the Company's interest rate swaps) , the gain or loss on the derivative financial instrument is recognized in earnings in the period of change together with the offsetting loss or gain on the hedged item attributable to the risk being hedged. As a result, the consolidated statement of operations includes the impact of changes in the fair value of both the derivative financial instrument and the hedged item, which reflects in earnings the extent to which the hedge is ineffective in achieving offsetting changes in fair value. For a derivative financial instrument designated as a cash flow hedge (e.g., the Company's cross-currency swaps) , the effective portion of the gain or loss on the derivative financial instrument is initially reported in equity as a component of accumulated other comprehensive loss, net , and subsequently reclassified into earnings when the hedged item (e.g., a forecasted transaction denominated in a foreign currency) affects earnings. The ineffective portion of the gain or loss is rep orted in earnings immediately. D erivative financial instruments are used to manage the risks associated with fluctuations in interest rates and foreign currency exchange rates and are not enter ed into f or speculative or trading purposes. T he fair value of interest rate swaps is determined using a DCF analysis based on the terms of the contract. This valuation requires estimates of future interest rates and judgments about the future credit worthiness of the Company and each counterparty over the terms of the contracts. Similarly, the fair value of cross - currency swaps is determined using a DCF analysis based on the terms of the contracts. This valuation requires estimates of future interest rates, forward exchange rates and judgments about the future credit worthiness of the Company and each counterparty over the terms of the contracts. Refer to Note 10 for further details. Indefinite-lived Intangible Assets and Goodwill At least annually, separate tests are performed to determine if the Company's indefinite - lived intangible assets (primarily cable franchise rights) and goodwill are impaired. Under th e accounting rules , a qualitative assessment may be performed to determine if an impairment is more likely than not to have occurred. If an impairment is more likely than not to have occurred, then a quantitative assessment is required, which may or may not result in an impairment charge. The determination of whether an impairment is more likely than not to have occurred requires significant judgment regarding potential changes in valuation inputs. Refer to Note 7 for further details. Long-lived Assets Long-lived assets (e.g., property, plant and equipment and finite-lived intangible assets) do not require an annual impairment test; instead, long-lived assets are tested for impairment upon the occurrence of a triggering event. Triggering events include the more likely than not disposal of a portion of such assets or the occurrence of an adverse change in the market involving the business employing the related assets. Once a triggering event has occurred, the impairment test is based on whether the intent is to hold the asset for continued use or to hold the asset for sale. If the intent is to hold the asset for continued use, the impairment test first requires a comparison of estimated undiscounted future cash flows generated by the asset group against the carrying value of the asset group. If the carrying value of the asset group exceeds the estimated undiscounted future cash flows, the asset would be deemed to be impaired. The impairment charge would then be measured as the difference between the estimated fair value of the asset and its carrying value. Fair value is generally determined by discounting the future cash flows associated with that asset. If the intent is to hold the asset for sale and certain other criteria are met (e.g., the asset can be disposed of currently, appropriate levels of authority have approved the sale, and there is an active program to locate a buyer), the impairment test involves comparing the asset's carrying value to its estimated fair value. To the extent the carrying value is greater than the asset's estimated fair value, an impairment charge is recognized for the difference. Significant judgments in this area involve determining whether a triggering event has occurred, determining the future cash flows for the assets involved and selecting the appropriate discount rate to be applied in determining estimated fair value . Investments T he carrying value of investments accounted for using the equity method of accounting is adjusted downward to reflect any other-than-temporary declines in value. A subjective aspect of accounting for investments involves determining whether an other -than-temporary decline in value of an investment has been sustained. In making this determination, all available information (e.g., budgets, business plans, financial statements, etc.) in addition to quoted market prices, if any, is evaluated . Factors indicative of an other -than-temporary decline include recurring operating losses, credit defaults and subsequent rounds of financing at an amount below the cost basis of the Company's investment. This list is not all-inclusive and all known quantitative and qualitative factors are weighed in determining if an other -than-temporary decline in value of an investment has occurred. If it has been determined that an investment has sustained an other -than-temporary decline in value, the investment is written down to fair value with a charge to earnings. Fair Value Measurements The fair value of an asset or liability is based on the assumptions that market participants would use in pricing the asset or liability. Valuation techniques consistent with the market approach, income approach and/or cost approach are used to measure fair value. A three-tiered fair value hierarchy is followed when determining the inputs to valuation techniques. The fair value hierarchy prioritizes the inputs to valuation techniques into three broad levels in order to maximize the use of observable inputs and minimize the use of unobservable inputs. The levels of the fair value hierarchy are as follows: Level 1: consists of financial instruments whose values are based on quoted market prices for identical financial instruments in an active market. Level 2: consists of financial instruments whose values are determined using models or other valuation methodologies that utilize inputs that are observable either directly or indirectly, including ( i ) quoted prices for similar assets or liabilities in active markets, (ii) quoted prices for identical or similar assets or liabilities in markets that are not active, (iii) pricing models whose inputs are observable for substantially the full term of the financial instrument and (iv) pricing models whose inputs are derived principally from or corroborated by observable market data through correlation or other means for substantially the full term of the financial instrument. Level 3: consists of financial instruments whose values are determined using pricing models that utilize significant inputs that are primarily unobservable, DCF methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. Pension Plans TWC sponsors the TWC Pension Plan (as defined in Note 13 ) and the Union Pension Plan (as defined in Note 13 ), both qualified defined benefit pension plans, that together provide pension benefits to a majority of the Company's employees. TWC also provides a nonqualified defined benefit pension plan for certain employees. Pension benefits are based on formulas that reflect the employees' years of service and compensation during their employment period. P ension expense is determined using certain assumptions, including the expected long-term rate of return on plan assets, discount rate and expected rate of compensation in creases. Equity-based Compensation The cost of employee services received in exchange for an award of equity instruments is measured based on the grant date fair value of the award. The cost of awards not subject to performance-based vesting conditions is recognized on a straight-line basis over the requisite service period and , for awards subject to performance-based vesting conditions deemed probable of being met, the cost is recognized over the requisite service period for each separately vesting tranche of awards . T he Black-Scholes model is used to estimate the grant date fair value of a stock option. Because the option-pricing model requires the use of subjective assumptions, changes in these assumptions can materially affect the fair value of stock options granted. The volatility assumption is calculated using the implied volatility of TWC traded options. The expected term, which represents the period of time that options are expected to be outstanding, is estimated based on the historical exercise experience of TWC employees. The risk-free rate assumed in valuing the stock options is based on the U.S. Treasury yield curve in effect at the time of grant for the expected term of the option. T he expected dividend yield percentage is determined by dividing the expected annual dividend by the market price of TWC c om mon stock at the date o f grant. Segments Public companies are required to disclose certain information about their reportable operating segments. Operating segments are defined as significant components of an enterprise for which separate financial information is available and is evaluated on a regular basis by the chief operating decision makers in deciding how to allocate resources to an individual operating segment and in assessing performance of the operating segment. The Company classifie s its operations into three reportable segments : Residential Services, Business Services and Other Operations. Refer to Note 16 for further details. Revenue and Costs Revenue R evenue consists of the revenue generated by each of the Company's reportable segments: Residential Services, Business Services and Other Operations. Residential S ervices segment revenue consists of ( i ) video revenue, including subscriber fees received from residential customers for various tiers or packages of video programming services, related equipment rental charges, installation charges , broadcast and sports fees and fees collected on behalf of local franchising authorities and the Federal Communications Commission , as well as revenue from the sale of premium networks, transactional video-on-demand (e.g., events and movies) and digital video recorder service; (ii) high-speed data revenue, including subscriber fees received from residential customers for high-speed data services and related equipment rental and installation charges; (iii) voice revenue, including subscriber fees received from residential customers for voice services , along with related installation charges , as well as fees collected on behalf of governmental authorities ; and (iv) other revenue , including revenue from security and home management services and other residential subscriber-related fees. Business S ervices segment revenue consists of ( i ) video revenue, including the same fee categories received from business video subscribers as described above under residential video revenue; (ii) high-speed data revenue, including subscriber fees received from business customers for high-speed data services and related installation charges, as well as amounts generated by the sale of commercial networking and point-to-point transport services , such as Metro Ethernet services ; (iii) voice revenue, including subscriber fees received from business customers for voice services , along with related installation charges , as well as fees collected on behalf of governmental authorities; (iv) wholesale transport revenue, including amounts generated by the sale of point-to-point transport services offered to wireless telephone providers (i.e., cell tower backhaul) and other telecommunications carriers ; and (v) other revenue , including revenue from enterprise-class, cloud-enabled hosting, managed applications and services and other business subscriber-related fees. Other Operations segment revenue consists of advertising revenue and other revenue. Advertising revenue is generated through the sale of video and online advertising inventory to local, regional and national advertising customers. Other revenue primarily includes ( i ) fees received from distributors of the Company's regional sports networks that carry Los Angeles Lakers ' basketball games and other sports programming (Time Warner Cable SportsNet and Time Warner Cable Deportes ); (ii) fees paid to TWC primarily by A/N for (a) the ability to distribute the Company's high-speed data service and (b) TWC's management of certain functions, including, among others, the acquisition of programming rights, as well as the provision of certain functions, including engineering; (iii) home shopping network-related revenue (including commissions earned on the sale of merchandise and carriage fees) ; and (iv) beginning in 2014, fees received from distributors of SportsNet LA . Revenue Recognition Residential and b usiness services subscriber fees are recorded as revenue in the period during which the service is provided. Residential and business services revenue received from subscribers who purchase bundled services at a discounted rate is allocated to each product in a pro-rata manner based on the individual product's selling price (generally, the price at which the product is regularly sold on a standalone basis). Revenue recognition for bundled services is discussed further in “—Multiple-element Transactions—Sales of Multiple Products or Services” below. Installation revenue obtained from traditional cable service connections is recognized as a component of residential and business services revenue when the connections are completed, as installation revenue recognized is less than the related direct selling costs. Advertising revenue is recognized in the period during which the advertisements are exhibited. Fees paid to TWC for the ability to distribute TWC's services are recognized as revenue in the period in which TWC's services are distributed to a consumer. Fees received for managing certain functions for A/N are recognized as revenue ratably over the year, which approximates the period in which management functions are performed. Home shopping network-related revenue is recognized as revenue in the period during which the merchandise is sold or the carriage fees are earned. In the normal course of business, the Company acts as or uses an intermediary or agent in executing transactions with third parties. The accounting issue presented by these arrangements is whether revenue should be reported based on the gross amount billed to the ultimate customer or on the net amount received from the customer after commissions and other payments to third parties. To the extent revenue is recorded on a gross basis, any commissions or other payments to third parties are recorded as expense so that the net amount (gross revenue less expense) is reflected in o perating i ncome. Accordingly, the impact on o perating i ncome is the same whether the revenue was recorded on a gross or net basis. As an example, TWC is assessed franchise fees by franchising authorities, which are passed on to the customer. The accounting issue presented by these arrangements is whether the revenue should be reported based on the gross amount billed to the ultimate customer or on the net amount received from the customer after payments to franchising authorities. I n instances where the fees are being assessed directly to the Company, amounts paid to governmental authorities and amounts received from customers are recorded on a gross basis. That is, amounts paid to governmental authorities are recorded as operating costs and expenses and amounts received from customer s are recorded as revenue. The amount of such fees recorded on a gross basis related to video, high-speed data and voice services was $684 million in 2015 , $666 million in 2014 and $685 million in 2013 . Operating Costs and Expenses P rogramming, high-speed data connectivity and voice network costs are recorded as the services are provided. P rogramming costs are recorded based on the contractual agreements with programming vendors , which are generally multi-year agreements under which payments are made to programming vendors at agreed upon rates based on the number of subscribers to which programming service s are provided . If a programming contract expires prior to the entry into a new agreement and the service continues to be distributed , programming costs are estimated during contract negotiations consider ing previous contractual rates, inflation and the status of the negotiations. When the programming contract terms are finalized, an adjustment to programming expense is recorded, if necessary, to reflect the terms of the new contract. Es timates are also made in the recognition of programming expense related to other items, such as the accounting for free periods and credits from service interruptions, as well as the allocation of consideration exchanged between the parties in multiple-element transactions. Additionally, judgments are also required when multiple services are purchased from the same programming vendor. In these scenarios, the total consideration provided to the programming vendor is allocated to the various services received based upon their respective estimated fair values. Because multiple services from the same programming vendor may be received over different contractual periods and may have different contractual rates, the allocation of consideration to the individual services may have an impact on the timing of expense recognition. Accounting for consideration exchanged between the parties in multiple-element transactions is discussed further in “—Multiple-element Transactions—Contemporaneous Purchases and Sales” below. Content acquisition costs for the Los Angeles Lakers' basketball games and Los Angeles Dodgers' baseball games are recorded as games are exhibited over the applicable season. Launch fees received from programming vendors are recognized as a reduction of expense on a straight-line basis over the term of the related programming arrangement. Amounts received from programming vendors representing the reimbursement of marketing costs are recognized as a reduction of marketing expense as the marketing services are provided. Advertising costs are expensed upon the first exhibition of the related advertisements. Marketing expense (including advertising), net of certain reimbursements from programmers, was $720 million in 2015 , $684 million in 2014 and $676 million in 2013 . Multiple-element Transactions Multiple-element transactions involve situations where judgment must be exercised in determining the fair value of the different elements in a bundled transaction. As the term is used here, multiple-element transactions can involve ( i ) c ontemporaneous purchases and sales (e.g., advertising services are sold to a customer and at the same time programming services are purchased ) and/or (ii) s ales of multiple products and/or services (e.g., video, high-speed data and voice services are sold to a customer) . Contemporaneous Purchases and Sales In the normal course of business, TWC enters into multiple-element transactions where the Company is simultaneously both a customer and a vendor with the same counterparty. For example, when negotiating the terms of programming purchase contracts with cable networks, the sale of advertising to the same cable network may be negotiated at the same time . Arrangements, although negotiated contemporaneously, may be documented in one or more contracts. The accounting policy for each transaction negotiated contemporaneously is to record each element of the transaction based on the respective estimated fair values of the products or services purchased and the products or services sold. The judgments made in determining fair value in such transactions impac t the amount of revenue , expenses and net income recognized over the respective terms of the transactions, as well as the respective periods in which they are recognized. In determining the fair value of the respective elements, quoted market prices (where available), historical transactions or comparable cash transactions are considered . The most frequent transactions of this type involve funds received from vendors. C ash consideration received from a vendor is recorded as a reduction in the price of the vendor's product unless ( i ) the consideration is for the reimbursement of a specific, incremental, identifiable cost incurred , in which case the cash consideration received would be recorded as a reduction in such cost , or (ii) an identifiable benefit in exchange for the consideration is provided , in which case revenue would be recognized for this element. With respect to vendor advertising arrangements being negotiated simultaneously with the same cable network, an assessment is performed to determine whether each piece of the arrangement is at fair value. The factors that are considered in determining the individual fair value of the programming vary from arrange ment to arrangement and include ( i ) the existence of a “most-favored-nation” clause or comparable assurances as to fair market value with respect to programming , (ii) a comparison to fees paid under a prior contract and (iii) a comparison to fees paid for similar networks . In determining the fair value of the advertising arrangement, advertising rates paid by other advertisers on the Company's systems with similar terms are considered . Sales of Multiple Products or Services If sales contracts are entered into for the sale of multiple products or services, the standalone selling price for each deliverable in the transaction is evaluated . For example, video, high-speed data and voice services are sold to subscribers in a bundled package at a rate lower than if the subscriber purchases each product on an individual basis. R evenue received from such subscribers is allocated to each product in a pro-rata manner based on the standalone selling price of each of the respective services on an individual basis. As another example, i f a subscriber moves from a bundled package containing two services to a bundled package containing three services, the increase in the total revenue received is not attributed to the additional service. Rather, the total revenue received from such subscribers are allocated to each of the three products in a pro-rata manner based on the relative selling price of each of the respective services on an individual basis. Income Taxes Income taxes are provided using the asset and liability method . Under this method, income taxes (i.e., deferred income tax assets, deferred income tax liabilities, taxes currently payable/refunds receivable and tax expense) are recorded based on amounts refundable or payable in the current year and include the results of any difference between GAAP and tax reporting. Deferred income taxes reflect the tax effect of net operating losses, capital losses, general business credit carryforwards and the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial statement and income tax purposes, based upon enacted tax laws and expected tax rates that will be in effect when the temporary differences reverse . Valuation allowances are established when management determines that it is more likely than not that some portion or the entire deferred tax asset will not be realized. The financial effect of changes in tax laws or rates is accounted for in the period of enactment . From time to time, transactions occur in which the tax consequences may be subject to uncertainty. Significant judgment is required in assessing and estimating the tax consequences of these transactions. Income tax returns are prepared and filed based on interpretation of tax laws and regulations. In the normal course of business, income tax returns are subject to examination by various taxing authorities. Such examinations may result in future tax, interest and penalty assessments by these taxing authorities. In determining the income tax provision for financial reporting purposes, a reserve for uncertain income tax positions is established unless it is determined that such positions are more likely than not to be susta |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share Disclosure [Abstract] | |
Earnings Per Share Disclosure | 4. EARNINGS PER SHARE Basic n et income per common share attributable to TWC common shareholders is determined using the two-class method and is computed by dividing net income attributable to TWC common shareholders by the weighted average of common shares outstanding during the period. The two-class method is an earnings allocation formula that determines income per share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. Diluted net income per common share attributable to TWC common shareholders reflects the more dilutive earnings per share amount calculated using the treasury stock method or the two-class method. Set forth below is a reconciliation of net income attributable to TWC common shareholders per basic and diluted common share for the years ended December 31, 2015 , 2014 and 2013 (in millions, except per share data): Year Ended December 31, 2015 2014 2013 Net income attributable to TWC common shareholders $ 1,825 $ 2,013 $ 1,944 Net income allocated to participating securities (a) 19 18 10 Net income attributable to TWC shareholders $ 1,844 $ 2,031 $ 1,954 Weighted-average basic common shares outstanding 282.6 279.3 287.6 Dilutive effect of nonparticipating equity awards 0.9 1.6 1.9 Dilutive effect of participating equity awards (a) 2.4 2.1 2.2 Weighted-average diluted common shares outstanding 285.9 283.0 291.7 Net income per common share attributable to TWC common shareholders: Basic $ 6.46 $ 7.21 $ 6.76 Diluted $ 6.44 $ 7.17 $ 6.70 —————————— R estricted stock units granted to employees and non-employee directors are considered participating securities with respect to regular quarterly cash dividends. |
BUSINESS ACQUISITION
BUSINESS ACQUISITION | 12 Months Ended |
Dec. 31, 2015 | |
Business Acquisition Disclosure [Abstract] | |
Business Acquisition Disclosure | 5 . BUSINESS ACQUISITION On December 31, 2013, TWC completed its acquisition of DukeNet Communications, LLC (“ DukeNet ”), a regional fiber optic network company that provides data and high-capacity bandwidth services to wireless carrier, data center, government and enterprise customers in North Carolina and South Carolina , as well as five other states in the Southeast, for $572 million in cash ( including the repayment of debt) , net of cash acquired and capital leases assumed . The financial results for DukeNet , which primarily affect the Business Services segment, have been included in the Company's consolidated financial statements from the date of acquisition and did not significantly impact the Company's consolidated financial results for the year ended December 31, 2013. |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Dec. 31, 2015 | |
Investments Disclosure [Abstract] | |
Investments Disclosure | 6. INVESTMENTS I nvestments as of December 31, 2015 and 2014 consisted of the following (in millions): December 31, 2015 2014 Equity-method investments (a) $ 62 $ 60 Other investments 3 4 Total investments $ 65 $ 64 —————————— Equity-method investments includes investments in MLB Network, LLC ( 5.3% owned) , iN Demand L . L . C . ( 28.6% owned) and National Cable Communications LLC ( 16.7% owned) . In addition, the Company has an equity-method investment in Sterling Entertainment Enterprises, LLC (doing business as SportsNet New York , 26.8% owned ). The Company has received distributions in excess of its investment in SportsNet New York and has reflected this amount ( $179 million as of December 31, 2015 and 2014 ) in other liabilities in the consolidated balance sheet . For the year s ended December 31, 2015 , 2014 and 2013 , the Company recognized income from equity-method investments , net, of $28 million , $33 million and $19 million, respectively, which is included in other income, net , in the consolidated statement of operations. |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 12 Months Ended |
Dec. 31, 2015 | |
Intangible Assets And Goodwill Disclosure [Abstract] | |
Intangible Assets and Goodwill Disclosure | 7. INTANGIBLE ASSETS AND GOODWILL I ntangible assets and related accumulated amortization a s of December 31, 2015 and 2014 consisted of the following (in millions): December 31, 2015 December 31, 2014 Accumulated Accumulated Gross Amortization Net Gross Amortization Net Intangible assets subject to amortization: Customer relationships $ 597 $ (353) $ 244 $ 600 $ (262) $ 338 Cable franchise renewals and access rights 306 (138) 168 297 (130) 167 Other 57 (32) 25 42 (24) 18 Total $ 960 $ (523) $ 437 $ 939 $ (416) $ 523 Intangible assets not subject to amortization: Cable franchise rights $ 26,936 $ (922) $ 26,014 $ 26,934 $ (922) $ 26,012 The Company recor ded amortization expense of $136 million in 2015 , $135 million in 2014 and $126 million in 2013 . Based on the remaining carrying value of intangible assets subject to amortization as of December 31, 2015 , amortizat ion expense is expected to be $133 million in 2016 , $129 million in 2017 , $51 million in 2018 , $32 million in 2019 and $26 million in 2020 . These amounts may vary as acquisitions and dispositions occur in the future. Changes in the carrying value of goodwill f rom January 1 through December 31 are presented below (in millions): 2015 2014 Balance at beginning of year $ 3,137 $ 3,196 Acquisition of DukeNet (a) — (61) Other changes and adjustments 2 2 Balance at end of year (b) $ 3,139 $ 3,137 —————————— During the first quarter of 2014, the Company finalized its fair value estimates for certain long-lived assets ( e.g., primarily property, plant and equipment and finite-lived intangible assets) acquired in the acquisition of DukeNet resulting in a net $61 million adjustment to goodwill , which was allocated to each reporting unit based upon relative fair value . There we re no accumulated goodwill impairment charges as of December 31, 2015 and 2014 . Annual Impairment Analysis As of the Company's July 1, 2015 annual testing date and based on its qualitative assessment, the Company determined that it was not more likely than not that its cable franchise rights and goodwill were impaired and, therefore, the Company did not perform a quantitative assessment as part of its annual impairment testing. In making that determination, management identified and analyzed qualitative factors, including factors that would most significantly impact a DCF analysis of the fair values of the cable franchise rights and the fair values of the Company's reporting units. This process included a review of the Company's most recent projections, analysis of operating results versus the prior year and budget, changes in market values, changes in discount rates and changes in terminal growth rate assumptions. Goodwill by reportable segment a s of December 31, 2015 and 2014 consisted of the following (in millions): December 31, 2015 2014 Residential Services $ 2,260 $ 2,259 Business Services 785 784 Other Operations 94 94 Total goodwill $ 3,139 $ 3,137 |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debt Disclosure | 8 . DEBT D ebt as of December 31, 2015 and 2014 consisted of the follow ing (in millions): Outstanding Balance as of December 31, Maturity 2015 2014 (recast) Senior notes and debentures (a) 2017-2042 $ 22,426 $ 23,029 Revolving credit facility 2017 — — Commercial paper program 2017 — 507 Capital leases 2016-2042 76 85 Total debt 22,502 23,621 Less: Current maturities (b) (5) (1,017) Total long-term debt $ 22,497 $ 22,604 ————————— The weighted-average effective interest rate for the senior notes and debentures as of December 31, 2015 wa s 6.218% and includes the effects of interest rate swaps and cross-currency swaps. Current maturities as of December 31, 2015 include amounts outstanding under capital leases . Senior Notes and Debentures TWC Notes and Debentures N otes and debentures issued by TWC as of December 31, 2015 and 2014 consisted of the following (in millions): Date of Outstanding Balance Interest as of December 31, Issuance Maturity Payment Principal 2015 2014 (recast) 3.500% notes Dec 2009 Feb 2015 Feb/Aug $ 500 $ — $ 501 5.850% notes Apr 2007 May 2017 May/Nov 2,000 2,045 2,075 6.750% notes June 2008 July 2018 Jan/July 2,000 2,002 1,989 8.750% notes Nov 2008 Feb 2019 Feb/Aug 1,250 1,242 1,240 8.250% notes Mar 2009 Apr 2019 Apr/Oct 2,000 2,004 1,992 5.000% notes Dec 2009 Feb 2020 Feb/Aug 1,500 1,485 1,481 4.125% notes Nov 2010 Feb 2021 Feb/Aug 700 696 695 4.000% notes Sep 2011 Sep 2021 Mar/Sep 1,000 992 991 5.750% notes (a) May 2011 June 2031 June 921 913 964 6.550% debentures Apr 2007 May 2037 May/Nov 1,500 1,483 1,482 7.300% debentures June 2008 July 2038 Jan/July 1,500 1,486 1,486 6.750% debentures June 2009 June 2039 June/Dec 1,500 1,455 1,453 5.875% debentures Nov 2010 Nov 2040 May/Nov 1,200 1,171 1,170 5.500% debentures Sep 2011 Sep 2041 Mar/Sep 1,250 1,221 1,220 5.250% notes (b) June 2012 July 2042 July 958 942 996 4.500% debentures Aug 2012 Sep 2042 Mar/Sep 1,250 1,233 1,233 Total (c) $ 20,370 $ 20,968 ————————— Outstanding balance amounts include £619 million valued at $913 m illion as of December 31, 2015 and £619 million valued at $964 m illion as of December 31, 2014 using the exchange rate at each date. Outstanding balance amount s include £639 million valued at $942 m illion as of December 31, 2015 and £640 million valued at $996 m illion as of December 31, 2014 using the exchange rate at each date. The total principal amount as of December 31, 2015 and 2014 is increased by the estimated fair value of net interest rate swap assets of $62 million and $74 million, respectively, and reduced by unamortized debt issuance costs of $89 million and $97 million, respectively, and unamortized discounts of $132 million and $145 million, respectively, in arriving at the total outstanding balance amounts. Capitalized debt issuance costs are amortized over the term of the related debt instrument as a component of interest expense , net . TWC has issued notes and debentures (the “ TWC Notes and Debentures ”) publicly in a number of offerings pursuant to an indenture, dated as of April 9, 2007, as it has been and may be amended from time to time (the “TWC Indenture”), by and among the Company, Time Warner Cable Enterprises LLC (“TWCE”), a 100% owned subsidiary of the Company, and The Bank of New York Mellon, as trustee. The TWC Indenture contains customary covenants relating to restrictions on the ability of the Company or any material subsidiary to create liens and on the ability of the Company and TWCE to consolidate, merge or convey or transfer substantially all of their assets. The TWC Indenture also contains customary events of default . TWC's obligations under the TWC Notes and Debentures are guaranteed by TWCE. The TWC Notes and Debentures are unsecured senior obligations of the Company and rank equally with its other unsecured and unsubordinated obligations. Interest on each series of TWC Notes and Debentures is payable semi-annually (with the exception of the British pound sterling denominated notes (the “Sterling Notes”) , which is payable annually ) in arrears. The guarantees of the TWC Notes and Debentures are unsecured senior obligations of TWCE and rank equally in right of payment with all other unsecured and unsubordinated obligations of TWCE . The TWC Notes and Debentures may be redeemed in whole or in part at any time at the Company's option at a redemption price equal to the greater of ( i ) all of the applicable principal amount being redeemed and (ii) the sum of the present values of the remaining scheduled payments on the applicable TWC Notes and Debentures discounted to the redemption date on a semi-annual basis (with the exception of the Sterling Notes , which are on an annual basis), at a comparable government bond rate plus a designated number of basis points as further described in the TWC Indenture and the applicable note or debenture , plus, in each case, accrued but unpaid interest to, but not including, the redemption date. The Company may offer to redeem all, but not less than all, of the Sterling Notes in the event of certain changes in the tax laws of the U.S. (or any taxing authority in the U.S.). This redemption would be at a redemption price equal to 100% of the principal amount, together with accrued and unpaid interest on the Sterling Notes to, but not including, the redemption date. TW C E Debentures D ebentures issued by TWCE as of December 31, 2015 and 2014 consisted of the following (in millions): Date of Outstanding Balance Interest as of December 31, Issuance Maturity Payment Principal 2015 2014 8.375% debentures Mar 1993 Mar 2023 Mar/Sept $ 1,000 $ 1,019 $ 1,022 8.375% debentures July 1993 July 2033 Jan/July 1,000 1,037 1,039 Total (a) $ 2,056 $ 2,061 ————————— The total principal amount as of December 31, 2015 and 2014 is increased by an unamortized fair value adjustment of $56 million and $61 million, respectively, primarily consisting of the fair value adjustment recognized as a result of the 2001 merger of America Online, Inc. and Time Warner Inc. , in arriving at the total outstanding balance amounts. The fair value adjustment is amortized over the term of the related debt instrument as a reduction to interest expense , net . T ime Warner Entertainment Company L.P. (“T WE ”) issued debentures publicly in a number of offerings. As a result of various internal reorganizations, TWCE has assumed all of the rights and obligations under TWE's previously issued debentures (the “TWCE Debentures”). TWCE's obligations under the TWCE Debentures are guaranteed by TWC. The TWCE Debentures were issued pursuant to an indenture, dated as of April 30, 1992, as it has been and may be amended from time to time (the “TW C E Indenture”) by and among TW C E, TWC and The Bank of New York Mellon, as trustee. The TW C E Indenture contains customary covenants relating to restrictions on the ability of TW C E or any material subsidiary to create liens and on the ability of TW C E and TWC to consolidate, merge or convey or transfer substantially all of their assets. The TW C E Indenture also contain s customary events of default . TWCE has no obligation to file separate reports with the S ecurities and Exchange Commission under the Securities Exchange Act of 1934, as amended. The TWCE Debentures are unsecured senior obligations of TW C E and rank equally with its other unsecured and unsubordinated obligations. Interest on each series of TWCE Debentures is payable semi-annually in arrears. The guarantees of the TWCE Debentures are unsecured senior obligations of TWC and rank equally in right of payment with all other unsecured and unsubordinated obligations of TWC . The TWCE Debentures are not redeemable before maturity . Revolving Credit Facility and Commercial Paper Program As of December 31, 2015 , the Company has a $3.5 billion senior unsecured five -year revolving credit facility maturing in April 2017 (the “Revolving Cred it Facility”). The Company's obligations under the Revolving Credit Facility are g uaranteed by TW C E. Borrowings under the Revolving Credit Facility bear interest at a rate based on the credit rating of TWC, which interest rate was LIBOR plus 1.10% per annum as of December 31, 2015 . In addition, TWC is required to pay a facility fee on the aggregate commitments under the Revolving Credit Facility at a rate determined by the credit rating of TWC, which rate was 0.15% per annum as of December 31, 2015 . The Revolving Credit Facility provides same-day funding capability, and a portion of the aggregate commitments, not to exceed $500 million at any time, may be used for the issuance of letters of credit. The Revolving Credit Facility contains a maximum leverage ratio covenant of 5.0 times TWC's consolidated EBITDA. The terms and related financial metrics associated with the leverage ratio are defined in the agreement. A s of December 31, 2015 , TWC was in compliance with the leverage ratio covenant, calculated in accordance with the agreement, with a ratio of approximately 2.6 times. The Revolving Credit Facility does not contain any credit ratings-based defaults or covenants or any ongoing covenants or representations specifically relating to a material adverse change in TWC's financial condition or results of operations. Borrowings under the Revolving Credit Facility may be used for general corporate purposes, and unused credit is available to support borrowings under the Commercial Paper Program (as defined below). In addition to the Revolving Credit Facility , the Company maintains a $2.5 billion unsecured commercial paper program (the “Commercial Paper Program”) that is also guaranteed by TWCE. Commercial paper issued under the Commercial Paper Program is supported by unused committed capacity under the Revolving Credit Facility and ranks equally with other unsecured senior indebtedness of TWC and TW C E. As of December 31, 2015 , the Company had no borrowings outstanding under the Revolving Credit Facility or the Commercial Paper Program. TWC's unused committed financial capacity was $4.607 billion as of December 31, 2015 , reflecting $1.170 b illion of cash and equivalents and $3.437 billion of available borrowing capacity under the Revolving Credit Facility (which reflects a reduction of $63 million for outstanding letters of credit backed by the Revolving Credit Facility). Maturities Annual maturities of debt total $5 m illion in 2016 , $2.004 b illion in 2017 , $2.003 b illion in 2018 , $3.253 b illion in 2019 , $1.504 billion in 2020 and $13.995 billion thereafter. |
MANDATORILY REDEEMABLE PREFERRE
MANDATORILY REDEEMABLE PREFERRED EQUITY | 12 Months Ended |
Dec. 31, 2015 | |
Mandatorily Redeemable Preferred Equity Disclosure [Abstract] | |
Mandatorily Redeemable Preferred Equity Disclosure | 9. MANDATORILY REDEEMABLE PREFERRED EQUITY In connection with the financing of the acquisition of substantially all of the cable assets of Adelphia Communications Corporation in 2006, Time Warner NY Cable LLC (“TW NY Cable”), a former subsidiary of TWC, issued $300 million of its Series A Preferred Membership Units (the “TW NY Cable Preferred Membership Units”) to a limited number of third parties. On August 1, 2013, all of the TW NY Cable Preferred Membership Units were redeemed by TW NY Cable as required pursuant to their terms for an aggregate redemption price of $300 million plus accrued dividends. The TW NY Cable Preferred Membership Units paid cash dividends at an annual rate equal to 8.210% of the sum of the liquidation preference thereof on a quarterly basis. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2015 | |
Derivative Financial Instruments And Fair Value Measurements Disclosure [Abstract] | |
Derivative Financial Instruments and Fair Value Measurements Disclosure | 10. DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS Assets and Liabilities Measured at Fair Value on a Recurring Basis The fair value s of assets and liabilities associated with derivative financial instruments recorded in the consolidated balance sheet as of December 31 , 2015 and 2014 consisted of the following (in millions): Assets Liabilities December 31, December 31, 2015 2014 2015 2014 Interest rate swaps (a)(b) $ 69 $ 93 $ 7 $ 19 Cross-currency swaps (a)(c) 90 197 80 — Total $ 159 $ 290 $ 87 $ 19 ————————— I nterest rate swap and cross-currency swap contracts with multiple counterparties are subject to contractual terms that provide for the net settlement of all such contracts with each counterparty , including cash collateral received or paid, through a single payment in the event of default on or termination of any one contract by either party. The fair values of the assets and liabilities associated with interest rate swaps and cross-currency swaps are presented on a gross basis in the consolidated balance sheet and are classified as current or noncurrent based on the maturity date of the respective contract. The fair value of assets associated with interest rate swaps as of December 31, 2015 is recorded in other assets in the consolidated balance sheet. Of the total fair value of assets associated with interest rate swaps as of December 31, 2014 , $1 million is recorded in other current assets with the remainder recorded in other assets in the consolidated balance sheet. The fair values of liabilities associated with interest rate swaps are recorded in other liabilities in the consolidated balance sheet. The fair values of assets and liabilities associated with cross-currency swaps are recorded in other assets and other liabilities, respectively, in t he consolidated balance sheet. Fair Value Hedges The Company uses interest rate swaps to manage interest rate risk by effectively converting fixed-rate debt into variable-rate debt. Under such contracts, the Company is entitled to receive semi-annual interest payments at fixed rates and is required to make semi-annual interest payments at variable rates, without exchange of the underlying principal amount. Such contracts are designated as fair value hedges. The Company recognize d no gain or loss related to its interest rate swap s because the changes in the fair values of such instruments we re completely offset by the changes in the fair values of the hedged fixed-rate debt. The fair value of interest rate swaps was determined using a DCF analysis based on the terms of the contract and expected forward interest rates, and incorporates the credit risk of the Company and each counterparty (a Level 2 fair value measurement). The following table summarizes the terms of existing fixed to variable interest rate swaps as of December 31, 2015 and 2014 : December 31, 2015 2014 Maturities 2017-2019 2015-2019 Notional amount (in millions) $ 5,600 $ 6,100 Weighted-average pay rate (variable based on LIBOR plus variable margins) 5.41% 4.78% Weighted-average receive rate (fixed) 6.86% 6.58% The notional amounts of interest rate instruments, as presented in the above table, are used to measure interest to be paid or received and do not represent the amou nt of exposure to credit loss. Cash Flow Hedges The Company uses cross-currency swaps to manage foreign exchange risk related to foreign currency denominated debt by effectively converting foreign currency denominated debt, including annual interest payments and the payment of principal at maturity, to U.S. dollar denominated debt. Such contracts are designated as cash flow hedges. The Company has entered into cross-currency swaps to effectively convert its £1.275 billion aggregate principal amount of fixed-rate British pound sterling denominated debt, including annual interest payments and the payment of principal at maturity, to fixed-rate U.S. dollar denominated debt. The cross-currency swaps have maturities of June 2031 and July 2042 . The fair value of cross-currency swaps was determined using a DCF analysis based on expected forward interest and exchange rates, and incorporates the credit risk of the Company and each counterparty (a Level 2 fair value measurement). The following table summarizes the effect of cash flow hedges on the consolidated statements of income and comprehensive income for the years ended December 3 1 , 2015 , 2014 and 2013 (in millions): Year Ended December 31, 2015 2014 2013 Deferred gains (losses) recognized in other comprehensive income (loss) (effective portion) $ (187) $ (124) $ 209 Deferred gains (losses) reclassified from accumulated other comprehensive loss, net, into other income, net (effective portion) (a) (107) (126) 39 ————————— Deferred gains (losses) on cross-currency swaps we re reclassified from accumulated other comprehensive loss, net , in to other income, net , which offset s the re-measurement gains (losses) recognized in other income, net , on the British pound sterling denominated debt. Any ineffectiveness related to cash flow hedges has been and is expected to be insignificant . Assets Measured at Fair Value on a Nonrecurring Basis The Company's assets measured at fair value on a nonrecurring basis include equity-method investments, long-lived assets, indefinite-lived intangible assets and goodwill. The Company reviews the carrying amounts of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable or at least annually as of July 1 for indefinite-lived intangible assets and goodwill. Any resulting asset impairment would require that the asset be reduced to its fair value. Refer to Note 7 for further details regarding the results of the Company's fair value analysis of cable franchise rights and goodwill . Fair Value of Other Financial Instruments The Company's other financial instruments not measured at fair value on a recurring basis include (a) cash and equivalents, receivables, accoun ts payable, accrued liabilities and borrowings under the Company's commercial paper program , which are reflected at cost in the consolidated balance sheet , and (b) the TWC Notes and Debentures and the TWCE Debentures (collectively, the “senior notes and debentures”) not subject to fair value hedge accounting, which are reflected at amortized cost in the consolidated balance sheet . With the exception of the senior notes and debentures , cost approximates fair value for these instruments due to their short-term nature. The carrying value and related estimated fair value of the senior notes and debentures was $22.426 billion and $23.637 billion, respectively, as of December 31, 2015 and $23.029 billion and $27.842 billion, respectively, as of December 31, 2014 . Estimated fair values for the senior notes and debentures are determined by reference to the market value of the instrument as quoted on a national securities exchange or in an over-the-counter market ( a Level 1 fair value measurement ) . |
TWC SHAREHOLDERS' EQUITY
TWC SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2015 | |
Time Warner Cable Shareholders Equity Disclosure [Abstract] | |
TWC Shareholders' Equity Disclosure | 11 . TWC SHAREHOLDERS' EQUITY Shares Authorized and Outstanding As of December 31, 2015 , TWC is authorized to issue up to approximately 8.333 b illion shares of TWC c ommon s tock, par value $0.01 per share, of which 283.3 million and 280.8 million shares were issued and outstanding as of December 31, 2015 and 2014 , respectively. TWC is also authorized to issue up to approximately 1.0 b illion shares of preferred stock, par value $0.01 per share. As of December 31, 2015 and 2014 , no preferred shares have been issued, nor does the Company have current plans to issue preferred shares . Changes in Common Stock Changes in common stock from January 1 through December 31 are presented below (in millions): 2015 2014 2013 Balance at beginning of year 280.8 277.9 297.7 Shares issued under the equity-based compensation plan 2.5 4.4 4.2 Shares repurchased and retired — (1.5) (24.0) Balance at end of year 283.3 280.8 277.9 Common Stock Repurchase Program In February 2014, the Company suspended its $4.0 billion common stock repurchase program (the “Stock Repurchase Program”). As of December 31, 2015 , the Company had $2.723 b illion remaining under the Stock Repurchase Program authorization. Common Stock Dividends TWC 's Board of Directors (“TWC's Board”) declared quarterly cash dividends per share of TWC c ommon s tock in 2015 , 2014 and 2013 as follows (in millions, except per share data): 2015 2014 2013 Per Share Amount Per Share Amount Per Share Amount First Quarter $ 1.50 $ 431 $ 0.75 $ 213 $ 0.65 $ 195 Second Quarter 0.75 216 0.75 215 0.65 190 Third Quarter 0.75 218 0.75 214 0.65 188 Fourth Quarter (a) 0.75 216 0.75 215 0.65 185 Total $ 3.75 $ 1,081 $ 3.00 $ 857 $ 2.60 $ 758 ————————— On December 17, 2015 , TWC's Board declared a quarterly cash dividend of $0.75 per share o f TWC c ommon s tock, payable in cash on January 25, 2016 to stockholders of record at the close of business on January 4, 2016 . Accumulated Other Comprehensive Income ( L oss ) , Net C hanges in accumulated other comprehensive income (loss), net, in cluded in TWC shareholders' equity from January 1 through December 31 are presented below (in millions): Year Ended December 31, 2015 2014 2013 Balance at beginning of year $ (324) $ 44 $ (663) Other comprehensive income (loss) before reclassifications, net of tax (182) (445) 686 Amounts reclassified into earnings, net of tax 92 77 21 Other comprehensive income (loss), net of tax (90) (368) 707 Balance at end of year $ (414) $ (324) $ 44 The following table summarizes the changes in the components of accumulated other comprehensive income (loss), net , included in TWC shareholders' equity from January 1 through December 31 (in millions): 2015 2014 2013 Unrealized losses on pension benefit obligation: Balance at beginning of year $ (473) $ (104) $ (708) Other comprehensive income (loss) before reclassifications, net of tax (65) (368) 558 Amounts reclassified into earnings, net of tax: Amortization of net actuarial loss (prior service credit) (a) 41 (2) 75 Income tax provision (benefit) (15) 1 (29) Amortization of net actuarial loss (prior service credit), net of tax 26 (1) 46 Other comprehensive income (loss), net of tax (39) (369) 604 Balance at end of year $ (512) $ (473) $ (104) Deferred gains (losses) on cash flow hedges: Balance at beginning of year $ 150 $ 149 $ 45 Other comprehensive income (loss) before reclassifications, net of tax (116) (77) 129 Amounts reclassified into earnings, net of tax: Effective portion of (gain) loss on cash flow hedges (b) 107 126 (39) Income tax provision (benefit) (41) (48) 14 Effective portion of (gain) loss on cash flow hedges, net of tax 66 78 (25) Other comprehensive income (loss), net of tax (50) 1 104 Balance at end of year $ 100 $ 150 $ 149 Other changes: Balance at beginning of year $ (1) $ (1) $ — Other comprehensive loss before reclassifications, net of tax (1) — (1) Amounts reclassified into earnings, net of tax — — — Other comprehensive loss, net of tax (1) — (1) Balance at end of year $ (2) $ (1) $ (1) ————————— Amounts are included in the computation of net periodic benefit costs as discussed further in Note 13 . Amounts are recorded in other income, net in the consolidated statement of operations as discussed further in Note 10 . |
EQUITY-BASED COMPENSATION
EQUITY-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2015 | |
Equity Based Compensation Disclosure [Abstract] | |
Equity-Based Compensation Disclosure | 12. EQUITY-BASED COMPENSATION TWC is authorized, under the Company's stock incentive plan (the “2011 Plan”) to grant restricted stock units (“RSUs”) and options to purchase shares of TWC common stock to its employees and non-employee directors. As of December 31, 2015 , the 2011 Plan provides for the issuance of up to 20.0 million shares of TWC common stock, of which 8.3 million shares were available for grant. Equity-based compensation expense and the related income tax benefit recognized for the years ended December 31, 2015 , 2014 and 2013 was as follows (in millions): Year Ended December 31, 2015 2014 2013 Equity-based compensation expense recognized: Restricted stock units (a) $ 147 $ 160 $ 89 Stock options 14 22 39 Total equity-based compensation expense (a) $ 161 $ 182 $ 128 Income tax benefit recognized $ 63 $ 71 $ 49 —————————— Amounts in clude $47 million in 2015 and $56 million in 2014 of equity-based compensation expense recognized in merger-related and restructuring costs in the consolidated statement of operations related to certain retention grants (as defined below) . Restricted Stock Units The following table summarizes information about unvested RSUs for the year ended December 31, 2015 : Weighted- Number Average of Grant Date Units Value (in millions) Unvested as of December 31, 2014 6.264 $ 112.06 Granted 0.986 179.02 Vested (1.120) 80.85 Forfeited (0.436) 129.20 Unvested as of December 31, 2015 5.694 128.47 For the year ended December 31, 2015 , TWC granted 986,000 RSUs at a weighted-average grant date fair value of $179.02 per RSU . For the year ended December 31, 2014 , TWC granted 3.807 million RSUs at a weighted-average grant date fair value of $135.81 per RSU , which included 143,000 RSUs subject to performance-based vesting conditions (“PBUs”) at a weighted-average grant date fair value of $135.31 per PBU . For the year ended December 31, 2013 , TWC granted 1.200 million RSUs at a weighted-average grant date fair value of $87.30 per RSU , which included 142,000 PBUs at a weighted-average grant date fair value of $87.31 per PBU. The fair value of RSUs that vested during the year was $91 million in 2015 , $87 million in 2014 and $98 million in 2013 . As of December 31, 2015 , the aggregate intrinsic value of unvested RSU s was $1.057 b illion. Total unrecognized compensation cost related to unvested RSU s as of December 31, 2015 , without taking into account expected forfeitures, was $440 million , which the Company expects to recognize over a weighted-average period of 3.58 years , without taking into account acceleration of vesting . In connection with the Company's entry into the Charter Merger Agreement, the Company advanced into 2015 its annual grants of equity awards that would otherwise have been made in 2017. As a result, eligible employees were granted RSUs having a value equal to (and with vesting terms consistent with) those that these employees otherwise would have received in 2017 (the “2015 retention grant”), but without performance-based vesting conditions. Specifically, the 2015 retention grant will vest 50% in February of 2020 and 50% in February of 2021, subject to continued employment. If the grantee's employment is terminated prior to the date on which the 2015 retention grant would have normally been made (i.e., February 2017), such retention grant would be forfeited, absent a change in control of the Company prior to such termination of employment. In connection with the Company's entry into the Comcast Merger Agreement, the Company advanced into 2014 its annual grant of equity awards that would otherwise have been made in 2015 and 2016. As a result, eligible employees were granted RSUs having a value equal to (and with vesting terms consistent with) those that these employees otherwise would have received in each of 2015 and 2016 (the “2014 retention grants” and, together with the 2015 retention grant, the “retention grants”), but without performance-based vesting conditions. Specifically, the retention grant corresponding to the 2015 annual grant will vest 50% in February of 2018 and 50% in February of 2019 and the retention grant corresponding to the 2016 annual grant will vest 50% in February of 2019 and 50% in February of 2020, in each case, subject to continued employment. If the grantee's employment were terminated prior to the date on which either retention grant would have normally been made (i.e., February 2015 or 2016, as appropriate), such retention grant would be forfeited, absent a change in control of the Company prior to such termination of employment. Employees who received the retention grants will generally not be eligible for additional annual equity awards with respect to 2015, 2016 or 2017 absent a change of responsibilities or other circumstances. Consequently, whether or not the Charter merger is consummated, both the employee and the Company would generally be in the same position they would have been in had the RSUs been granted in accordance with the anticipated schedule. With the exception of the retention grants discussed above, RSUs, including PBUs, generally vest 50% on each of the third and fourth anniversary of the grant date, subject to continued employment and, in the case of PBUs, subject to the satisfaction and certification of the applicable performance conditions. RSUs generally provide for accelerated vesting upon the termination of the grantee's employment after reaching a specified age and years of service or upon a n involuntary termination of the grantee's employment within 24 months following a change in control of the Company and, in the case of PBUs, subject to the satisfaction and certification of the applicable performance conditions. PBUs are subject to forfeiture if the applicable performance condition is not satisfied. RSUs awarded to non-employee directors are not subject to vesting or forfeiture restrictions and the shares underlying the RSUs will generally be issued in connection with a director's termination of service as a director. Pursuant to the directors' compensation program, certain directors with more than three years of service on the Board of Directors have elected an in-service vesting period for their RSU awards. Holders of RSUs are generally entitled to receive cash dividend equivalents or retained distributions related to regular cash dividends or other distributions, respectively, paid by TWC. In the case of PBUs, the receipt of the dividend equivalents is subject to the satisfaction and certification of the applicable performance conditions. Retained distributions are subject to the vesting requirements of the underlying RSUs. Upon the vesting of a RSU, shares of TWC common stock may be issued from authorized but unissued shares or from treasury stock, if any. Stock Options The following table summarizes information about stock options that were outstanding as of December 31, 2015 : Weighted- Weighted- Average Number Average Remaining Aggregate of Exercise Contractual Intrinsic Options Price Term Value (in millions) (in years) (in millions) Outstanding as of December 31, 2014 4.219 $ 75.29 Exercised (1.905) 73.88 Forfeited or expired (0.124) 87.56 Outstanding as of December 31, 2015 2.190 75.83 5.85 $ 240 Exercisable as of December 31, 2015 0.881 63.93 4.47 107 Expected to vest as of December 31, 2015 1.291 83.79 6.77 131 For the year s ended December 31, 2015 and 2014 , TWC granted no stock option s . For the year ended December 31, 2013 , TWC granted 2.539 million stock option s at a weighted-average grant date fair value of $15.66 per option , which included 302,000 stock options subject to performance-based vesting conditions (“PBOs”) at a weighted-average grant date fair value of $15.57 per PBO. The total intrinsic value of stock option s exercised was $165 million in 2015 , $285 million in 2014 and $167 million in 2013 . Cash received from stock option s exercised was $129 million in 2015 , $226 million in 2014 and $138 million in 2013 . Income t ax benefits realized from s tock option s exercised was $64 million in 2015 , $114 million in 2014 and $67 million in 2013 . Total unrecognized compensation cost related to unvested stock option s as of December 31, 2015 , without taking into account expected forfeitures, wa s $7 million , which the Company expects to recognize over a weighted-average period of 1.08 years , without taking into account acceleration of vesting . Stock options , including PBOs, have exercise prices equal to the fair market value of TWC common stock at the date of grant. Generally, stock option s vest ratably over a four -year vesting period and expire ten years from the date of grant, subject to continued employment and, in the case of PBOs, subject to the satisfaction and certification of the applicable performance condition. Certain stock option awards provide for accelerated vesting upon the termination of the grantee's employment after reaching a specified age and years of service or upon a n involuntary termination of the grantee's employment within 24 months following a change in control of the Company and, in the case of PBOs, subject to the satisfaction and certification of the applicable performance conditions. PBOs are subject to forfeiture if the applicable performance condition is not satisfied. Upon the exercise of a stock option, shares of TWC common stock may be issued from authorized but unissued shares or from treasury stock, if any. The table below presents the assumptions used to value stock options a t their grant date for the year ended December 31, 2013 and reflects the weighted average of all awards granted within that year: Expected volatility 26.14% Expected term to exercise from grant date (in years) 5.94 Risk-free rate 1.19% Expected dividend yield 2.97% |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2015 | |
Employee Benefit Plans Disclosure [Abstract] | |
Employee Benefit Plans Disclosure | 13 . E MPLOYEE BENEFIT PLANS Pension Plans TWC sponsors the Time Warner Cable Pension Pla n (the “TWC Pension Plan”) and the Time Warner Cable Union Pension Plan (the “Union Pension Plan” and, together with the TWC Pension Plan, the “qualified pension plans”) , both qualified defined benefit pension plans, that together provide pension benefits to a majority of the Company's employees. TWC also provides a nonqualified defined benefit pension plan for certain employees (the “nonqualified pension plan” and, together with the qualified pension plans, the “pension plans”). Pension benefits are based on formulas that reflect the employees' years of service and compensation during their employment period. TWC uses a December 31 measurement date for its pension plans. Changes in the projected benefit obligation, fair value of plan assets and funded status of the pension plans from January 1 through December 31 are presented below (in millions ): 2015 2014 Projected benefit obligation at beginning of year $ 3,206 $ 2,550 Service cost 230 173 Interest cost 147 144 Actuarial (gain) loss (241) 606 Plan amendment (a) — 3 Benefits paid (b) (151) (270) Projected benefit obligation at end of year $ 3,191 $ 3,206 Accumulated benefit obligation at end of year $ 2,715 $ 2,709 Fair value of plan assets at beginning of year $ 3,106 $ 3,124 Actual return on plan assets (116) 247 Employer contributions 5 5 Benefits paid (b) (151) (270) Fair value of plan assets at end of year $ 2,844 $ 3,106 Funded status $ (347) $ (100) ————————— On February 7, 2014, the TWC Pension Plan was amended to offer a lump sum option to all participants whose benefit commencement date is on or after January 1, 2015. On February 21, 2014, the TWC Pension Plan was amended to provide certain eligible participants and deferred beneficiaries with a voluntary election opportunity during a limited-time period to receive, or to commence receiving, their p lan benefit effective June 1, 2014 in the form of a lump sum cash payment or certain other optional forms of payment. The opportunity to make this voluntary election was available between March 4, 2014 and April 24, 2014. As a result of this amendment, eligible participants received benefit payments of $210 million during 2014 . The projected benefit obligation, accumulated benefit obligation and fair value of plan assets for the qualified pension plans and the nonqualified pension plan as of December 31, 2015 and 2014 consisted of the following (in millions): Qualified Pension Plans Nonqualified Pension Plan December 31, December 31, 2015 2014 2015 2014 Projected benefit obligation $ 3,153 $ 3,166 $ 38 $ 40 Accumulated benefit obligation 2,677 2,670 38 39 Fair value of plan assets 2,844 3,106 — — Pretax a mounts recognized in the consolidated balance sheet as of December 31, 2015 and 2014 consisted of the following (in millions): December 31, 2015 2014 Current liability $ (5) $ (5) Noncurrent liability (342) (95) Total amounts recognized in liabilities $ (347) $ (100) Accumulated other comprehensive income (loss), net: Net actuarial loss $ (862) $ (802) Prior service credit 27 30 Total amounts recognized in TWC shareholders’ equity $ (835) $ (772) The components of net periodic benefit costs for the years ended December 31, 2015 , 2014 and 2013 consisted of the following (in millions): Year Ended December 31, 2015 2014 2013 Service cost $ 230 $ 173 $ 204 Interest cost 147 144 139 Expected return on plan assets (229) (233) (214) Amounts amortized 41 (3) 75 Settlement loss — — 1 Net periodic benefit costs $ 189 $ 81 $ 205 The estimated amounts that are expected to be amortized from accumulated other comprehensive loss, net , into net periodic benefit costs in 2016 include actuarial losses net of prior service credits of $45 million. Weighted-average assumptions used to determine benefit obligations a s of December 31, 2015 , 2014 and 2013 consisted of the following : 2015 2014 2013 Discount rate 4.74% 4.32% 5.27% Rate of compensation increase 4.25% 4.25% 4.75% In addition, the mortality tables used to determine benefit obligations as of December 31, 2015 , 2014 and 2013 consisted of the following: RP 2000 healthy mortality table loaded 5.5% with generational improvements using Scale BB for 2015 and 2014 and the RP 2000 healthy mortality table projected to 2020 using Scale AA for 2013 . Weighted-average assumptions used to determine net periodic benefit cost for the years ended December 31, 2015 , 2014 and 2013 consisted of the following : 2015 2014 2013 Expected long-term rate of return on plan assets 7.50% 7.50% 7.50% Discount rate 4.32% 5.27% 4.31% Rate of compensation increase 4.25% 4.75% 4.75% The discount rate s used to determine benefit obligations and net periodic benefit costs w ere determined by the matching of plan liability cash flows to a portfolio of bonds individually selected from a large population of high-quality corporate bonds. In developing the expected long-term rate of return on plan assets, the Company considered the pension portfolio's composition, past average rate of earnings , discussions with portfolio managers and the Company's asset allocation targets. T he weighted-average expected long-term rate of return on plan assets used to dete rmine net periodic benefit cost for the year ended December 31, 2016 is expected to be 7.50% . Pension Assets T he assets of the qualified pension plans are held in a master trust in which the qualified pension plans are the only participating plans (the “Master Trust”). The investment policy for the qualified pension plans is to maximize the long-term rate of return on plan assets within a prudent level of risk and diversification while maintaining adequate funding levels. The investment portfolio i s a mix of equity and fixed-income securities with the objective of matching plan liability performance , diversifying risk and achieving a target investment return. The pension plans' Investment Committee regularly monitors investment performance, investment allocation policies and the performance of individual investment managers of the Master Trust and makes adjustments and changes when necessary. On a periodic basis, the Investment Committee conducts a broad strategic review of its portfolio construction and investment allocation policies. Neither t he Company nor the Investment Committee manages any assets internally or directly utilize s derivative instruments or hedging; however, the investment mandate of some investment managers allows the use of derivatives as components of their standard portfolio management strategies. Pension assets are managed in a balanced portfolio comprised of two major components: a return-seeking portion and a liability-matching portion. The expected role of return-seeking investments is to maximize the long-term growth of pension assets with a prudent level of risk , while the role of liability-matching investments is to provide a partial hedge against liability performance associated with changes in interest rates and potentially provide some protection against a prolonged decline in the market value of equity investments. The objective within return-seeking investments is to achieve asset diversity in order to balance return and volatility. The target and actual investment allocation of the qualified pension plans by asset category as of December 31, 2015 and 2014 consisted of the following : Actual Allocation Target as of December 31, Allocation 2015 2014 Return-seeking securities 70.0% 66.0% 68.2% Liability-matching securities 30.0% 33.7% 31.4% Other investments 0.0% 0.3% 0.4% The following table s set forth the investment assets of the qualified pension plans , which exclude accrued investment income and other receivables and accrued liabilities , by level within the fair value hierarchy as of December 31, 2015 and 2014 (in millions): December 31, 2015 Fair Value Measurements Fair Value Level 1 Level 2 Level 3 Cash $ 1 $ 1 $ — $ — Common stocks: Domestic (a) 1,051 1,051 — — International (a) 368 368 — — Commingled equity funds (b) 337 — 337 — Other equity securities (c) 4 4 — — Corporate debt securities (d) 325 — 325 — Commingled bond funds (b) 259 — 259 — U.S. Treasury debt securities (a) 255 255 — — Collective trust funds (e) 89 — 89 — U.S. government agency asset-backed debt securities (f) 34 — 34 — Corporate asset-backed debt securities (g) 8 — 8 — Other fixed-income securities (h) 104 — 104 — Other investments (i) 7 — — 7 Total investments assets 2,842 $ 1,679 $ 1,156 $ 7 Accrued investment income and other receivables (j) 65 Accrued liabilities (j) (63) Fair value of plan assets $ 2,844 December 31, 2014 Fair Value Measurements Fair Value Level 1 Level 2 Level 3 Common stocks: Domestic (a) $ 1,176 $ 1,176 $ — $ — International (a) 412 412 — — Commingled equity funds (b) 348 — 348 — Mutual funds (a) 70 70 — — Other equity securities (c) 3 3 — — Corporate debt securities (d) 361 — 361 — Commingled bond funds (b) 268 — 268 — U.S. Treasury debt securities (a) 194 194 — — Collective trust funds (e) 80 — 80 — U.S. government agency asset-backed debt securities (f) 34 — 34 — Corporate asset-backed debt securities (g) 10 — 10 — Other fixed-income securities (h) 130 — 130 — Other investments (i) 14 4 — 10 Total investments assets 3,100 $ 1,859 $ 1,231 $ 10 Accrued investment income and other receivables (j) 79 Accrued liabilities (j) (73) Fair value of plan assets $ 3,106 ————————— Common stocks , mutual funds and U.S. Treasury debt securities are valued at the closing price reported on the active market on which the i ndividual securities are traded. No single industry comprise d a significant portion of common stock held by the qualified pension plan as of December 31, 2015 and 2014 . Commingled equity funds and commingled bond funds are valued using the net asset value provided by the administrator of the fund. The net asset value is based on the value of the underlying assets owned by the fund, less liabilities, and then divided by the number of units outstanding. Other equity securities consist of preferred stocks, which are valued at the closing price reported on the active market on which the individual securities are traded. Corporate debt securities are valued based on observable prices from the new issue market, benchmark quotes, secondary trading and dealer quotes. An option adjusted spread model is incorporate d to adjust spreads of issues that have early redemption features and final spreads are added to the U.S. Treasury curve. Collective trust funds primarily consist of short-term in vestment strategies comprised of instruments issued or fully guaranteed by the U.S. government and/or its agencies and are valued using the net asset value provided by the administrator of the fund. The net asset value is based on the value of the underlying assets owned by the fund, less liabilities, and t h en divided by the number of units outstanding. U.S. government agency asset-backed debt securities consist of pass-through mortgage-backed securities issued by the Federal Home Loan Mortgage Corporation and the Federal National Mortgage Association valued using available trade information, dealer quotes, market indices and research reports, spreads, bids and offers. Corporate asset-backed debt securities primarily consist of pass-through mortgage-backed securities issued by U.S. and foreign corporations valued using available trade information, dealer quotes, market indices and research reports, spreads, bids and offers. Other fixed-income securities consist of foreign government debt securities , municipal bonds and U.S. government agency debt securities, which are valued based on observable prices from the new issue market, benchmark quotes, secondary trading and dealer quotes. An option adjusted spread model is incorporated to adjust spreads of issues that have early redemption features and final spreads are added to the U.S. Treasury curve. Other investments primarily consist of private equity investments, such as those in limited partnerships that invest in operating companies that are not publicly traded on a stock exchange, and hedge funds. Private equity investments are valued using inputs such as trading multiples of comparable public securities, merger and acquisition activity and pricing data from the most recent equity financing taking into consideration illiquidity. Hedge funds are valued using the net asset value provided by the administrator of the fund, which is based on the value of the underlying assets owned by the fund, less liabilities, and then divided by the number of units outstanding. Accrued investment income and other receivables includes amounts receivable under foreign exchange contracts of $54 million and $67 million as of December 31, 2015 and 2014 , respectively. Accrued liabilities includes amounts accrued under foreign exchange contracts of $54 million and $67 million as of December, 2015 and 2014 , respectively. The fair value of the assets and liabilities associated with the se foreign exchange contracts are presented on a gross basis and are valued using the exchange rates in effect for the applicable currencies as of the valuation date (a Level 1 fair value measurement). Changes in the fair value of investment assets valued using significant unobservable inputs (Level 3) from January 1 through December 31 are presented below (in millions): 2015 2014 Balance at beginning of year $ 10 $ 10 Purchases and sales: Purchases 2 2 Sales (7) (2) Sales, net (5) — Actual return on plan assets held at end of year 2 — Balance at end of year $ 7 $ 10 Expected Cash Flows The Company made no cash contributions to the qualified pension plans during 2015 ; however, t he Company may make discretionary cash contributions to the qualified pension plans in 2016 . Such contributions will be dependent on a variety of factors, including current and expected interest rates, asset performance, the funded status of the qualified pension plans and management's judgment . For the nonqualified pension plan, the Company will continue to make contributions in 2016 t o the extent benefits are paid. Benefit payments for the p ension p lans are exp ected to be $126 million in 2016 , $142 million in 2017 , $158 million in 2018 , $174 million in 2019 , $189 million in 2020 and $1.176 b illion in 2021 to 202 5 . Multiemployer Plans TWC contributes to a number of multiemployer plans under the terms of collective-bargaining agreements that cover its union-represented employees . Such multiemployer plans provide medical, pension and retirement savings benefits to active employees and retirees. T he Company made contributions to multiemployer plans of $46 million in 2015 , $45 million in 2014 and $44 million in 2013 . The risks of participating in multiemployer pension plans are different from single-employer pension plans in the following aspects: (a) assets contributed to a multiemployer pension plan by one employer may be used to provide benefits to employees of other participating employers, (b) if a participating employer stops contributing to the multiemployer pension plan, the unfunded obligations of the plan may be borne by the remaining participating employers and (c) if TWC chooses to stop participating in any of the multiemployer pension plans, the Company may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability . The multiemployer pension plans to which the Company contributes each received a Pension Protection Act “green” zone status in 2014 . The zone status is based on the most recent information the Company received from the plan and is certified by the plan's actuary. Among other factors, plans in the green zone are at least 80 % f unded. Defined Contribution Plan TWC employees also participate in a defined contribution plan, the TWC Savings Plan, for which the expense for employer matching contributions totaled $97 million in 2015, $91 million in 2014 and $82 million in 2013. The Company's contributions to the TWC Savings Plan are primarily based on a percentage of the employees' elected contributions and are subject to plan provisions. |
MERGER-RELATED AND RESTRUCTURIN
MERGER-RELATED AND RESTRUCTURING COSTS | 12 Months Ended |
Dec. 31, 2015 | |
Merger Related And Restructuring Costs Disclosure [Abstract] | |
Merger-Related and Restructuring Costs Disclosure | 14. MERGER-RELATED AND RESTRUCTURING COSTS Merger-related and restructuring costs for the years ended December 31, 2015 , 2014 and 2013 consisted of the following (in millions): Year Ended December 31, 2015 2014 2013 Merger-related costs $ 183 $ 198 $ 13 Restructuring costs 20 27 106 Total merger-related and restructuring costs $ 203 $ 225 $ 119 Merger-related Costs For the year ended December 31 , 2015 , the Company incurred merger-related costs of $183 million of which $146 million related to the Charter merger, including employee retention costs of $84 million and advisory and legal fees of $62 million, and $37 million related to the Comcast merger, including employee retention costs of $27 million and advisory and legal fees of $10 million. For the year ended December 31, 2014 , the Company incurred merger-related costs of $198 million of which $195 million related to the Comcast merger, including employee retention costs of $121 million and advisory and legal fees of $74 million. Merger-related costs for the year ended December 31 , 2014 also included $3 million incurred in connection with the acquisition of DukeNet . For the year ended December 31, 2013 , the Company incurred merger-related costs of $13 million, primarily associated with the acquisition s of I nsight Communications Company, Inc . (“Insight”) and DukeNet . The Company expects to incur additional merger-related costs in connection with the Charter merger through the closing of the merger. Changes in accruals for merger-related costs from January 1 through December 31 are presented below (in millions): Employee Other Costs Costs Total Remaining liability as of December 31, 2012 $ 7 $ 7 $ 14 Costs incurred — 13 13 Cash paid (4) (17) (21) Remaining liability as of December 31, 2013 3 3 6 Costs incurred 68 75 143 Adjustments (1) — (1) Cash paid (5) (61) (66) Remaining liability as of December 31, 2014 65 17 82 Costs incurred 64 77 141 Costs reimbursed by Charter — (5) (5) Cash paid (82) (83) (165) Remaining liability as of December 31, 2015 (a) $ 47 $ 6 $ 53 ————————— The rem aining $53 million liability as of December 31, 2015 is classified as a current liability in the consolidated balance sheet . In addition to the cash settled liabilities shown in the table above, the Company also issued retention RSUs, as discussed in Note 12 , which resulted in additional merger-related costs of $47 million in 2015 and $56 million in 2014 . Restructuring Costs F or the years ended December 31, 2015 , 2014 and 2013 , t he Company incurred restructuring costs of $20 million, $27 million and $106 million respectively, primarily related to employee terminations and other exit costs. The Company expects to incur additional restructuring costs during 201 6 . Changes in restructuring reserves from January 1 through December 31 are presented below (in millions): Employee Other Termination Exit Costs Costs Total Remaining liability as of December 31, 2012 $ 24 $ 3 $ 27 Costs incurred 88 18 106 Cash paid (73) (17) (90) Remaining liability as of December 31, 2013 39 4 43 Costs incurred 14 16 30 Adjustments (3) — (3) Cash paid (42) (20) (62) Remaining liability as of December 31, 2014 8 — 8 Costs incurred 20 — 20 Cash paid (16) — (16) Remaining liability as of December 31, 2015 (a) $ 12 $ — $ 12 ————————— Of the remaining liability as of December 31, 2015 , $7 million is classified as a current liability, with the remaining amount classified as a noncurrent liability in the consolidated balance sheet. Amounts are expected to be paid through March 2019 . |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes Disclosure [Abstract] | |
Income Taxes Disclosure | 15. INCOME TAXES The c urrent and deferred income tax (benefit) provision for the years ended December 31, 2015 , 2014 and 2013 consisted of the following (in millions): Year Ended December 31, 2015 2014 2013 Federal: Current $ 444 $ 363 $ 631 Deferred 525 681 411 State: Current 107 98 91 Deferred 68 75 (48) Total $ 1,144 $ 1,217 $ 1,085 The differences between income tax (benefit) provision expected at the U.S. federal statutory income tax rate of 35% and income tax (benefit) provision provided for the years ended December 31, 2015 , 2014 and 2013 consisted of the following (in millions): Year Ended December 31, 2015 2014 2013 Income tax provision at U.S. federal statutory rate $ 1,046 $ 1,137 $ 1,064 State and local taxes, net of federal tax effects 114 112 28 Other (16) (32) (7) Total $ 1,144 $ 1,217 $ 1,085 The income tax provision and effective tax rate for the year ended December 31, 2014 include a benefit of $24 million as a result of the passage of the New York State budget during the first quarter of 2014 that, in part, lowers the New York State business tax rate beginning in 2016. The income tax provision and effective tax rate for the year ended December 31, 2013 include ( i ) a benefit of $77 million primarily related to change s in the tax rate applied to calculate the Company's net deferred income tax liability as a result of changes to state tax apportionment factors and ( i i) a benefit of $27 million resulting from income tax reform legislation enacted in North Carolina, which, along with other changes, phases in a reduction in North Carolina's corporate income tax rate over several years. Significant components of deferred income tax liabilities, net, as of December 31, 2015 and 2014 consisted of the following (in millions): December 31, 2015 2014 Cable franchise rights and customer relationships, net $ (8,627) $ (8,298) Property, plant and equipment (4,740) (4,466) Other (100) (133) Deferred income tax liabilities (13,467) (12,897) Net operating loss carryforwards (a) 24 92 Tax credit carryforwards (a) 32 31 Other 604 511 Valuation allowances (b) (23) (28) Deferred income tax assets 637 606 Deferred income tax liabilities, net $ (12,830) $ (12,291) —————————— Net operating loss and tax credit carryforwards expire in varying amounts through 2035 . Aside from certain net operating loss and state tax credit carryforwards for which a valuation allowance has been established, the Company does not expect these carryforwards to expire unutilized. The Company's valuation allowance for deferred income tax assets recorded as of December 31, 2015 and 2014 primarily relates to certain net operating loss and state tax credit carryforwards. The valuation allowance is based upon the Company's assessment that it is more likely than not that a portion of the deferred income tax asset will not be realized. Changes in deferred income tax liabilities, net, from January 1 through December 31 are presented below (in millions): 2015 2014 2013 Balance at beginning of year $ (12,291) $ (11,764) $ (10,963) Deferred income tax provision (593) (756) (363) Acquisition of Insight — — 5 Recorded directly to TWC shareholders’ equity as a component of accumulated other comprehensive income (loss), net: Change in accumulated unrealized losses on pension benefit obligation 24 230 (377) Change in accumulated deferred gains (losses) on cash flow hedges 30 (1) (66) Balance at end of year $ (12,830) $ (12,291) $ (11,764) Uncertain Income Tax Positions The Company recognizes income tax benefits for those income tax positions determined more likely than not to be sustained upon examination, based on the technical merits of the positions. The reserve for uncertain income tax positions is included in other liabilities in the consolidated balance sheet. Changes in the reserve for uncertain income tax positions, excluding the related accrual for interest and penalties, from January 1 through December 31 are presented below (in millions): 2015 2014 2013 Balance at beginning of year $ 112 $ 108 $ 73 Additions for prior year tax positions 10 16 30 Additions for current year tax positions 18 13 19 Reductions for prior year tax positions (2) (5) — Lapses in statute of limitations (16) (5) (3) Settlements and reversals of timing differences (8) (15) (11) Balance at end of year $ 114 $ 112 $ 108 If the Company were to recognize the benefits of these unc ertain income tax positions, the income tax provision and effective tax rate would be impacted by $83 million in 2015 , $74 million in 2014 and $68 million in 2013 , including interest and penalties and net of the federal and state benefit for income taxes. These benefit amounts include interest and penalties of $14 million in 2015 , $15 million in 2014 and $20 million in 2013 , net of the feder al and state benefit for income taxes. The impact of temporary differences and tax attributes are considered when calculating accruals for interest and penalties associated with the reserve for uncertain income tax positions. The amount accrued for interest and penalties , before the feder al and state benefit for income taxes, as of December 31, 2015 and 2014 was $19 million and $20 million, respectively. The Company recognize s interest and penalties accrued on uncertain income tax positions as part of the income tax provision. The income tax provision includ es provision (benefit) related to interest and penalties , before the feder al and state provision ( benefit ) for income taxes, of $(7) million in 2014 and $6 million in 2013 . The provision (benefit) related to interest and penalties in 2015 was insignificant. The Company has determined that it is reasonably possible that its existing reserve for uncertain income tax positions as of December 31, 2015 could decrease by up to approximately $28 million during the twelve-month period ending December 31, 2016 related to various ongoing audits and settlement discussions with the I nternal Revenue Service (the “IRS”) and various state and local jurisdictions. If the Company were to recognize the benefits of these uncertain income tax positions upon a favorable resolution of th ese matter s , the income tax provision and effective tax rate c ould be impacted by up to approximately $23 million , including interest and penalties and net of the federal and state benefit for income taxes . This benefit amount includes interest and penalties of approximately $2 million, net of the federal and state benefit for income taxes. T he Company otherwise does not currently anticipate that i t s reserve for uncertain income tax positions as of December 31, 2015 will significantly increase or decrease during the twelve-month period ended December 31, 2016 ; h owever, various events could cause the Company's current expectations to change in the future. The IRS is currently examining TWC's income tax returns for 2011 and 2012. Prior to TWC's separation from Time Warner Inc. (“Time Warner”) in March 2009 (the “Separation”), TWC was included in the consolidated U.S. federal and certain state income tax returns of Time Warner. The IRS is currently examining Time Warner's 2008 through 2010 income tax returns. The Company does not anticipate that these examinations will have a material impact on the Company's consolidated financial position or results of operations. In addition, the Company is also subject to ongoing examinations of the Company's tax returns by state and local tax authorities for various periods. Activity related to these state and local examinations did not have a material impact on the Company's consolidated financial position or results of operations in 2015, nor does the Company anticipate a material impact in the future. In August 2014, the IRS examination of TWC's 2009 and 2010 income tax returns for periods after the Separation was settled. In September 2014, the IRS examination of Time Warner's income tax returns for 2005 to 2007, which are periods prior to the Separation, was settled with the exception of an immaterial item that has been referred to the IRS Appeals Division. The resolution of these examinations did not have a material impact on the Company's consolidated financial position or results of operations. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2015 | |
Segment Information Disclosure [Abstract] | |
Segment Information Disclosure | 16. SEGMENT INFORMATION The Company classifie s its operations into the following three reportable segments, which have been determined based on how management evaluates and manages the business: Residential Services, which principally consist s of video , high-speed data and voice services provided to residential customers as well as other residential services, including security and home management services . Business Services, which principally consists of data, video and voice services provided to business customers as well as other business services, including enterprise-class, cloud-enabled hosting, managed applications and services. Other Operations, which principally consists of ( i ) Time Warner Cable Media (“TWC Media”), the advertising sales arm of TWC , (ii) TWC-owned and/or operated regional sports networks (“RSNs”) and local sports, news and lifestyle channels (e.g., Time Warner Cable News NY1) and (i ii ) other operating revenue and costs, i ncluding those derived from A/N and home shopping network-related services. The business units reflected in the Other Operations segment individually do not meet the thresholds to be reported as separate reportable segments. In addition to the above reportable segments, the Company has shared functions (referred to as “Shared Functions”) that include activities not attributable to a specific reportable segment. Shared Functions consists of operating costs and expenses associated with broad “corporate” functions (e.g., accounting and finance, information technology, executive management, legal and human resources) or functions supp orting more than one reportable segment that are centrally managed (e.g., facilities, network operations, vehicles and procurement ) as well as other activities not attributable to a reportable segment . As such, the reportable segment results reflect how management views such segments in assessing financial performance and allocating resources and are not necessarily indicative of the results of operations that each segment would have achieved had they operated as stand-alone entities during the periods presented. In evaluating the profitability of the Company's segments, the components of net income (loss) below OIBDA, as defined below , are not separately evaluated by management at the segment level. Due to the nature of the Company's operations, a majority of its assets, including its distribution systems, are utilized across the Company's operations and are not segregated by segment. In addition , segment assets are not reported to, or used by, management to allocate resources or assess the performance of the Company's segments. Accordingly, the Company has not disclosed asset information by segment. Segment information for the years ended December 31, 2015 , 2014 and 2013 is as follows ( in millions): Year Ended December 31, 2015 Residential Business Other Services Services Operations Shared Intersegment Total Segment Segment Segment Functions Eliminations Consolidated Revenue (a) $ 18,966 $ 3,284 $ 1,710 $ — $ (263) $ 23,697 Operating costs and expenses (10,477) (1,297) (1,045) (3,003) 263 (15,559) Merger-related and restructuring costs — — — (203) — (203) OIBDA $ 8,489 $ 1,987 $ 665 $ (3,206) $ — 7,935 Depreciation (3,560) Amortization (136) Operating Income $ 4,239 Year Ended December 31, 2014 Residential Business Other Services Services Operations Shared Intersegment Total Segment Segment Segment Functions Eliminations Consolidated Revenue (a) $ 18,446 $ 2,838 $ 1,772 $ — $ (244) $ 22,812 Operating costs and expenses (9,823) (1,119) (985) (2,901) 244 (14,584) Merger-related and restructuring costs — — — (225) — (225) OIBDA $ 8,623 $ 1,719 $ 787 $ (3,126) $ — 8,003 Depreciation (3,236) Amortization (135) Operating Income $ 4,632 Year Ended December 31, 2013 Residential Business Other Services Services Operations Shared Intersegment Total Segment Segment Segment Functions Eliminations Consolidated Revenue (a) $ 18,402 $ 2,312 $ 1,602 $ — $ (196) $ 22,120 Operating costs and expenses (9,714) (961) (769) (2,892) 196 (14,140) Merger-related and restructuring costs — — — (119) — (119) OIBDA $ 8,688 $ 1,351 $ 833 $ (3,011) $ — 7,861 Depreciation (3,155) Amortization (126) Operating Income $ 4,580 —————————— Revenue derived from outside the U.S. was insignificant in all periods presented. No single customer accounted for a significant amount of revenue in any period presented. Intersegment E liminations relates to the programming provided to the R esidential S ervices and B usiness S ervices segments by the RSNs and local sports, news and lifestyle channels . These services are r eflected as programming expense for the R esidential S ervices and B usiness S ervices segments and as revenue for the Other Operations segment . R evenue for the years ended December 31, 2015 , 2014 and 2013 was derived from the following sources (in millions): Year Ended December 31, 2015 2014 2013 Residential Services revenue: Video $ 9,907 $ 10,002 $ 10,481 High-speed data 7,029 6,428 5,822 Voice 1,931 1,932 2,027 Other 99 84 72 Total Residential Services revenue 18,966 18,446 18,402 Business Services revenue: Video 385 365 347 High-speed data 1,609 1,341 1,099 Voice 599 511 421 Wholesale transport 491 415 251 Other 200 206 194 Total Business Services revenue 3,284 2,838 2,312 Other Operations revenue: Advertising 1,028 1,127 1,019 Other 682 645 583 Total Other Operations revenue 1,710 1,772 1,602 Intersegment eliminations (263) (244) (196) Total revenue $ 23,697 $ 22,812 $ 22,120 Use of OIBDA Management uses Operating Income before Depreciation and Amortization (“OIBDA”) , among other measures, in evaluating the segment's performance because it eliminates the effects of ( i ) considerable amounts of noncash depreciation and amortization and (ii) items not within the control of the Company's operations managers (such as income tax provision, other income (expense), net, and interest expense, net). Management also uses this measure to evaluate the Company's consolidate d operating performance and to allocate resources and capital to the segments. Performance measures derived from OIBDA are also used in the Company's annual incentive compensation programs. In addition, this measure is commonly used by analysts, investors and others in evaluating the Company's performance. This measure has inherent limitations. For example, OIBDA does not reflect capital expenditures or the periodic costs of certain capitalized assets used in generating revenue. To compensate for such limitations, management evaluates the Company's consolidated performance through, among other measures, various cash flow measures, which reflect capital expenditure decisions, and net income attributable to TWC shareholders, which reflects the periodic costs of capitalized assets. OIBDA also fails to reflect the significant costs borne by the Company for income taxes and debt servicing costs, the results of the Company's equity investments and other non-operational income or expense. Management compensates for these limitations by using other analytics such as a review of net income attributable to TWC shareholders. This non-GAAP measure should be considered in addition to, not as a substitute for, the Company's Operating Income and net income attributable to TWC shareholders, as well as other measures of financial performance reported in accordance with GAAP, and may not be comparable to similarly titled measures used by other companies. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure | 17. COMMITMENTS AND CONTINGENCIES In March 2003, the interests in cable networks and filmed entertainment held by TWE were transferred to Time Warner and all of Time Warner's interests in cable systems were transferred to the Company (the “TWE Restructuring”). Prior to the TWE Restructuring , TWE had various contingent commitments, including guarantees, related to the TWE non-cable businesses. In connection with the TWE Restructuring, some of these commitments were not transferred with their applicable non-cable business and they remain contingent commitments of TWE (and assumed by TWCE in connection with various internal reorganizations) . Time Warner and its subsidiary, Warner Communications Inc. , have agreed, on a joint and several basis , to indemnify TW C E from and against any and all of these contingent liabilities, but TWE (as assumed by TWCE) remains a party to these commitments. TWC has cable franchise agreements containing provisions requiring the construction of cable plant and the provision of services to customers within the franchise areas. In connection with these obligations under existing franchise agreements, TWC obtains surety bonds or letters of credit guaranteeing performance to municipalities and public utilities and payment of insurance premiums. Such surety bonds and letters of credit as of December 31, 2015 and 2014 totaled $424 million and $373 million , respectively . Payments under these arrangements are required only in the event of nonperformance. TWC does not expect that these contingent commitments will result in any amounts being paid in the foreseeable future. Contractual Obligations The Company has obligations to make future payments for goods and services under certain contractual arrangements. These contractual obligations secure the future rights to various assets and services to be used in the normal course of the Company's operations. For example, the Company is contractually committed to make certain minimum lease payments for the use of property under operating lease agreements. In accordance with applicable accounting rules, the future rights and obligations pertaining to firm commitments, such as operating lease obligations and certain purchase obligations under contracts, are not reflected as assets or liabilities in the consolidated balance sheet. The Company's total rent expense, which primarily includes facility rental expense and pole attachm ent rental fees, was $305 million in 2015, $298 million in 2014 and $257 million in 2013 . The Company has lease obligations under various operating leases including minimum lease obligations for real estate and operating equipment. The minimum rental commitments under long-term operating leases during the next five years are $170 million in 2016 , $144 million in 2017 , $125 million in 2018 , $99 million in 2019 , $71 million in 2020 and $245 million thereafter . The following table summarizes the Company's aggregate contractual obligations outstanding as of December 31, 2015 under certain programming and content purchase agreements and various other contractual obligations ( including amounts associated with data processing services, high-speed data connectivity, fiber-rela ted and TWC Media obligations) and the estimated timing and effect that such obligations are expected to have on the Company's liquidity and cash flows in future periods (in millions): 2016 $ 5,975 2017 - 2018 7,947 2019 - 2020 3,445 Thereafter 10,903 Total $ 28,270 Programming and content purchases represent contracts that the Company has with cable television networks and broadcast stations to provide programming services to its subscribers. The amounts included above represent estimates of the future programming costs for these contract requirements and commitments based on subscriber numbers and tier placement as of December 31, 2015 applied to the per-subscriber rates contained in these contracts. Actual amounts due under such contracts may differ from the amounts above based on the actual subscriber numbers and tier placements. These amounts also include programming rights negotiated directly with content owners for distribution on TWC-owned channels or networks and commitments related to TWC's role as an advertising and distribution sales agent for third party-owned channels or networks . Minimum pension funding requirements have not been presented in the table above as such amounts have not been determined beyond 2015. The Company made no cash contributions to the qualified pension plans in 2015 ; however, t he Company may make discretionary cash contributions to the qualified pension plans in 2016 . For the nonqualified pension plan, the Company contributed $5 million during 2015 and will continue to make contributions in 2016 to the extent benefits are paid. Legal Proceedings In connection with the formerly proposed Comcast merger, eight putative class action complaints were filed on behalf of purported TWC stockholders in the New York Supreme Court (the “NY Actions”) and the Court of Chancery of the State of Delaware. These complaints name d as defendants TWC, the members of the TWC board of directors, Comcast and Comcast's merger subsidiary. The complaints generally allege d , among other things, that the members of the TWC board of directors breached their fiduciary duties to TWC stockholders during merger negotiations and by entering into the Comcast Merger Agreement and approving the Comcast merger, and that Comcast aided and abetted such breaches of fiduciary duties. The complaints further allege d that the joint proxy statement/prospectus filed by Comcast with the Securities and Exchange Commission (the “SEC”) on March 20, 2014 was misleading or omitted certain material information. The complaints sought , among other relief, compensatory damages in an unspecified amount, injunctive relief and costs and fees. The parties entered into a settlement agreement, conditioned inter alia on the consummation of the Comcast merger. Now that the Comcast Merger Agreement has been terminated, the settlement is no longer operative, although the plaintiffs have the right to petition the court for the award of attorneys' fees and TWC has the right to oppose that application. Following the announcement of the Charter merger on May 26, 2015, on June 29, 2015, the parties in the NY Actions filed a stipulation agreeing that plaintiffs could file a Second Consolidated Class Action Complaint ( the “Second Amended Complaint ” ), and dismissing with prejudice Comcast and Comcast's merger subsidiary . After the c ourt so ordered the stipulation, the plaintiffs in the NY Actions filed the Second Amended Complaint on July 1, 2015. The Second Amended Complaint names as defendants TWC, the members of the TWC board of directors, Charter and the merger subsidiaries. The Second Amended Complaint generally alleges, among other things, that the members of the TWC board of directors breached their fiduciary duties to TWC stockholders during the Charter merger negotiations and by entering into the Charter Merger Agreement and approving the Charter merger, and that Charter and its subsidiaries aided and abetted such breaches of fiduciary duties. The complaint seeks, among other relief, injunctive relief enjoining the shareholder vote on the Charter merger, unspecified declaratory and equitable relief, compensatory damages in an unspecified amount, and costs and fees. On September 9 , 2015, the parties in the NY Actions entered into a Memo randum of Understanding (“MOU”) , which reflects an agreement in principle to settle the case. Pursuant to the MOU, TWC and Charter mad e certain supplemental disclosures in Current Report s on Form 8 -K filed with the SEC on September 9, 2015 , and the plaintiffs agreed to withdraw their motion for preliminary relief . The parties have agreed to finalize and execute a definitive s ettlement agreement by February 16 , 2016 . The Company believes that the claims asserted against it are without merit and , if the settlement does not receive final approval by the New York Supreme Court or otherwise is not consummated, intends to defend against this lawsuit vigorously. The Company is unable to predict the outcome of this lawsuit or reasonably est imate a range of possible loss. On December 19, 2011, Sprint Communications Company L.P. (“Sprint”) filed a complaint in the U.S. District Court for the District of Kansas alleging that the Company infringes 12 patents purportedly relating to Voice over Internet Protocol (“VoIP”) services. The plaintiff is seeking monetary damages as well as injunctive relief. On October 8, 2015, the court stayed this litigation based on a judgment in a parallel case against Cox Communications, Inc. (“Cox Communications”) in the U.S. District Court for the District of Delaware invalidating six of the 12 patents at issue in that litigation. The stay applies to all 12 patents at issue in Sprint's complaint against the Company, and the Company expects the stay to remain in effect during the pendency of Sprint's appeal against Cox Communications. The Company intends to defend against this lawsuit vigorously, but is unable to predict the outcome of this lawsuit or reasonably estimate a range of possible loss. On December 5, 2014, Broadband iTV , Inc. filed an amended complaint in the U.S. District Court for the District of Hawaii alleging that the Company infringes a patent purportedly relating to the Company's delivery of digital video on demand services and seeking monetary and injunctive relief. The complaint also names Hawaiian Telecom, Inc. (“Hawaiian Telecom”) as a defendant. On January 9, 2015, the Company answered the amended complaint and moved to sever the allegations against the Company from those against Hawaiian Telecom. On April 16, 2015, the c ourt severed the allegations against the Company from those against Hawaiian Telecom, but consolidated the cases for pre-trial purposes. The court issued a claim construction order on June 24, 2015 and the parties have exchanged expert reports on the issues of infringement, validity and damages. On September 29, 2015, the court granted the Company's summary judgment motion invalidating the patent and dismissing the litigation with prejudice. On October 9, 2015, the plaintiff appealed this decision to the U.S. Court of Appeals for the Federal Circuit. The Company intends to defend against this lawsuit vigorously, but is unable to predict the outcome of this lawsuit or reasonably estimate a range of possible loss . The Company is the defendant in In re: Set-Top Cable Television Box Antitrust Litigation , ten purported class actions filed in federal district courts throughout the U.S. These actions are subject to a Multidistrict Litigation (“MDL”) Order transferring the cases for pretrial proceedings to the U.S. District Court for the Southern District of New York. On July 26, 2010, the plaintiffs filed a third amended consolidated class action complaint (the “Third Amended Complaint”), alleging that the Company violated Section 1 of the Sherman Antitrust Act, various state antitrust laws and state unfair/deceptive trade practices statutes by tying the sales of premium cable television services to the leasing of set-top converter boxes. The plaintiffs are seeking, among other things, unspecified treble monetary damages and an injunction to cease such alleged practices. On September 30, 2010, the Company filed a motion to dismiss the Third Amended Complaint, which the court granted on April 8, 2011. On June 17, 2011, the plaintiffs appealed this decision to the U.S. Court of Appeals for the Second Circuit. The Company intends to defend against this lawsuit vigorously, but is unable to predict the outcome of this lawsuit or reasonably estimate a range of possible loss. From time to time, the Company receives notices from third parties and, in some cases, is party to litigation alleging that certain of the Company's services or technologies infringe the intellectual property rights of others. Claims of intellectual property infringement could require TWC to enter into royalty or licensing agreements on unfavorable terms, incur substantial monetary liability or be enjoined preliminarily or permanently from further use of the intellectual property in question. In addition, certain agreements entered into by the Company may require it to indemnify the other party for certain third-party intellectual property infringement claims, which could increase the Company's damages and its costs of defending against such claims. Even if the claims are without merit, defending against the claims can be time consuming and costly. Other Matters The California Attorney General and the Alameda County, California District Attorney are investigating whether certain of the Company's waste disposal policies, procedures and practices are in violation of the California Business and Professions Code and the California Health and Safety Code. These entities are seeking injunctive relief, unspecified civil penalties and attorneys' fees. While th e Company is unable to predict the outcome of this investigation , it does not believe that the outcome will have a material effect on its results of operations, financial condition or cash flows. As part of the TWE Restructuring, Time Warner agreed to indemnify the Company from and against any and all liabilities relating to, arising out of or resulting from specified litigation matters brought against the TWE non-cable businesses (and assumed by TWCE in connection with various internal reorganizations) . Although Time Warner has agreed to indemnify the Company against such liabilities, TWE (as assumed by TWCE) remains a named party in certain litigation matters. The costs and other effects of future litigation, governmental investigations, legal and administrative cases and proceedings (whether civil or criminal), settlements, judgments and investigations, claims and changes in pending matters (including those matters described above), and developments or assertions by or against the Company relating to intellectual property rights and intellectual property licenses, could have a material adverse effect on the Company's business, financial condition and operating r esults. |
ADDITIONAL FINANCIAL INFORMATIO
ADDITIONAL FINANCIAL INFORMATION | 12 Months Ended |
Dec. 31, 2015 | |
Additional Financial Information Disclosure [Abstract] | |
Additional Financial Information Disclosure | 18. ADDITIONAL FINANCIAL INFORMATION Other Current Assets Other current assets as of December 31, 2015 and 2014 consist ed of the following (in millions): December 31, 2015 2014 (recast) Prepaid income taxes $ 155 $ 157 Other prepaid expenses 201 208 Other current assets 17 18 Total other current assets $ 373 $ 383 Other Current Liabilities Other current liabilities as of December 31, 2015 and 2014 consist ed of the following (in millions): December 31, 2015 2014 Accrued interest $ 481 $ 486 Accrued compensation and benefits 443 397 Accrued insurance 225 199 Accrued dividends 216 — Accrued sales and other taxes 150 132 Accrued franchise fees 145 151 Other accrued expenses 419 448 Total other current liabilities $ 2,079 $ 1,813 Interest Expense, Net Interest expense, net , for the years ended December 31, 2015 , 2014 and 2013 consist ed of the following (in millions): Year Ended December 31, 2015 2014 2013 Interest expense $ (1,402) $ (1,419) $ (1,555) Interest income 1 — 3 Interest expense, net $ (1,401) $ (1,419) $ (1,552) Other Income , Net Other income , net , for the years ended December 31, 2015 , 2014 and 2013 consist ed of the following (in millions): Year Ended December 31, 2015 2014 2013 Income from equity-method investments, net $ 28 $ 33 $ 19 Gain on settlement of Verizon Wireless agency agreement (a) 120 — — Other 2 2 (8) Total other income, net $ 150 $ 35 $ 11 —————————— In 2011, in conjunction with SpectrumCo , LLC's (a joint venture between TWC, Comcast and Bright House Networks) entry into an agreement to sell its advanced wireless spectrum licenses to Cellco Partnership (doing business as Verizon Wireless), TWC and Verizon Wireless entered into agency agreements that allowed TWC to sell Verizon Wireless-branded wireless service, and Verizon Wireless to sell TWC services. Amount represents the settlement of certain terms of the agency agreements in 2015. Related Party Transactions T ransactions with related parties ( i.e. , equity-method investees) for the years ended December 31, 2015 , 2014 and 2013 consisted of the following (in millions): Year Ended December 31, 2015 2014 2013 Revenue $ 7 $ 6 $ 7 Costs and expenses: Programming and content $ (191) $ (176) $ (205) Other operating (22) (21) (20) Total costs and expenses $ (213) $ (197) $ (225) Supplemental Cash Flow Information Additional financial information with respect to cash (payments) and receipts for the years ended December 31, 2015 , 2014 and 2013 is as follows (in millions): Year Ended December 31, 2015 2014 2013 Cash paid for interest $ (1,482) $ (1,562) $ (1,740) Cash received under interest rate swap contracts 100 127 164 Cash paid for interest, net $ (1,382) $ (1,435) $ (1,576) Cash paid for income taxes $ (468) $ (366) $ (698) Cash refunds of income taxes 15 14 2 Cash paid for income taxes, net $ (453) $ (352) $ (696) The consolidated statement of cash flows for the year ended December 31, 2013 includes purchases of short-term investments in U.S. Treasury securities of $575 million (included in purchases of investments) . The consolidated statement of cash flows for the year ended December 31, 2013 includes proceeds from the maturity of short-term investments in U.S. Treasury securities of $725 million (included in proceeds from sale, maturity and collection of investments). The consolidated statement of cash flows for the year ended December 31, 2013 do es not reflect $51 million of common stock repurchases that were included in other current liabilities as of December 31, 2013 for which payment was made in January 2014 . |
CONDENSED CONSOLIDATING FINANCI
CONDENSED CONSOLIDATING FINANCIAL STATEMENTS | 12 Months Ended |
Dec. 31, 2015 | |
Condensed Consolidating Financial Statements Disclosure [Abstract] | |
Condensed Consolidating Financial Statements Disclosure | 19. CONDENSED CONSOLIDATING FINANCIAL STATEMENTS Set forth below are condensed consolidating financial statements presenting the financial position, results of operations (including comprehensive income) and cash flows of ( i ) Time Warner Cable Inc. (the “Parent Company”), (ii) Time Warner Cable Enterprises LLC (“TWCE” or the “Guarantor Subsidiar y ”) , a direct 100% owned subsidiary of the Parent Company , (iii) the direct and indirect non- g uarantor s ubsidiar ies of the Parent Company (the “Non- Guarantor Subsidiar ies ”) on a combined basis and (iv) the eliminations necessary to arrive at the information for Time Warner Cable Inc. on a consolidated basis. The Guarantor Subsidiar y ha s fully and unconditionally guaranteed the debt securities issued by the Parent Company in its 2007 registered exchange offer and subsequent public offerings. The Parent Company directly owns all of the voting and economic interests of the Guarantor Subsidiar y . There are no legal or regulatory restrictions on the Parent Company's ability to obtain funds from any of its 100% owned subsidiaries through dividends, loans or advances. These condensed consolidating financial statements should be read in conjunction with the consolidated financial statements of Time Warner Cable Inc. Basis of Presentation In presenting the condensed consolidating financial statements, the equity method of accounting has been applied to ( i ) the Parent Company's interests in the Guarantor Subsidiary and the Non-Guarantor Subsidiaries and (ii) the Guarantor Subsidiary's interests in the Non-Guarantor Subsidiaries, where applicable, even though all such subsidiaries meet the requirements to be consolidated under GAAP. All intercompany balances and transactions between the Parent Company, the Guarantor Subsidiary and the Non-Guarantor Subsidiaries have been eliminated, as shown in the column “Eliminations.” All assets and liabilities have been allocated to the Parent Company, the Guarantor Subsidiary and the Non-Guarantor Subsidiaries generally based on legal entity ownership. Certain administrative costs have been allocated to the Parent Company, the Guarantor Subsidiary and the Non-Guarantor Subsidiaries based on revenue recorded at the respective entity. The income tax provision has been presented based on each subsidiary's legal entity activity including income tax benefits related to allocated administrative costs and interest expense. Deferred income taxes have been presented based upon the temporary differences between the carrying amounts of the respective assets and liabilities of the applicable entities. C ondensed consolidating financial information is as follows (in millions): Condensed Consolidating Balance Sheet as of December 31, 2015 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and equivalents $ 901 $ — $ 269 $ — $ 1,170 Receivables, net 23 — 893 — 916 Receivables from affiliated parties 225 — 29 (254) — Other current assets 125 31 217 — 373 Total current assets 1,274 31 1,408 (254) 2,459 Investments in and amounts due from consolidated subsidiaries 46,841 49,326 7,641 (103,808) — Investments — 53 12 — 65 Property, plant and equipment, net — 26 16,919 — 16,945 Intangible assets subject to amortization, net — 18 419 — 437 Intangible assets not subject to amortization — — 26,014 — 26,014 Goodwill — — 3,139 — 3,139 Other assets 269 10 56 (117) 218 Total assets $ 48,384 $ 49,464 $ 55,608 $ (104,179) $ 49,277 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ — $ — $ 656 $ — $ 656 Deferred revenue and subscriber-related liabilities — — 224 — 224 Payables to affiliated parties 29 222 3 (254) — Accrued programming and content expense — — 985 — 985 Current maturities of long-term debt — — 5 — 5 Other current liabilities 725 66 1,288 — 2,079 Total current liabilities 754 288 3,161 (254) 3,949 Long-term debt 20,370 2,056 71 — 22,497 Deferred income tax liabilities, net — 249 12,698 (117) 12,830 Long-term payables to affiliated parties 7,641 14,702 — (22,343) — Other liabilities 460 80 462 — 1,002 TWC shareholders’ equity: Due to (from) TWC and subsidiaries 10,164 2,076 (12,240) — — Other TWC shareholders’ equity 8,995 30,013 51,452 (81,465) 8,995 Total TWC shareholders’ equity 19,159 32,089 39,212 (81,465) 8,995 Noncontrolling interests — — 4 — 4 Total equity 19,159 32,089 39,216 (81,465) 8,999 Total liabilities and equity $ 48,384 $ 49,464 $ 55,608 $ (104,179) $ 49,277 Condensed Consolidating Balance Sheet as of December 31, 2014 (recast) Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and equivalents $ 481 $ — $ 226 $ — $ 707 Receivables, net 31 — 918 — 949 Receivables from affiliated parties 215 — 27 (242) — Other current assets 113 46 224 — 383 Total current assets 840 46 1,395 (242) 2,039 Investments in and amounts due from consolidated subsidiaries 44,790 46,401 7,641 (98,832) — Investments — 51 13 — 64 Property, plant and equipment, net — 28 15,962 — 15,990 Intangible assets subject to amortization, net — 5 518 — 523 Intangible assets not subject to amortization — — 26,012 — 26,012 Goodwill — — 3,137 — 3,137 Other assets 308 12 74 (24) 370 Total assets $ 45,938 $ 46,543 $ 54,752 $ (99,098) $ 48,135 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ — $ — $ 567 $ — $ 567 Deferred revenue and subscriber-related liabilities — — 198 — 198 Payables to affiliated parties 27 212 3 (242) — Accrued programming and content expense — — 902 — 902 Current maturities of long-term debt 1,008 — 9 — 1,017 Other current liabilities 529 63 1,221 — 1,813 Total current liabilities 1,564 275 2,900 (242) 4,497 Long-term debt 20,467 2,061 76 — 22,604 Deferred income tax liabilities, net 26 230 12,059 (24) 12,291 Long-term payables to affiliated parties 7,641 14,702 — (22,343) — Other liabilities 154 91 481 — 726 TWC shareholders’ equity: Due to (from) TWC and subsidiaries 8,073 1,216 (9,289) — — Other TWC shareholders’ equity 8,013 27,968 48,521 (76,489) 8,013 Total TWC shareholders’ equity 16,086 29,184 39,232 (76,489) 8,013 Noncontrolling interests — — 4 — 4 Total equity 16,086 29,184 39,236 (76,489) 8,017 Total liabilities and equity $ 45,938 $ 46,543 $ 54,752 $ (99,098) $ 48,135 Condensed Consolidating Statement of Operations for the Year Ended December 31, 2015 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Revenue $ — $ — $ 23,697 $ — $ 23,697 Costs and expenses: Programming and content — — 5,815 — 5,815 Sales and marketing — — 2,379 — 2,379 Technical operations — — 1,669 — 1,669 Customer care — — 900 — 900 Other operating — — 4,796 — 4,796 Depreciation — — 3,560 — 3,560 Amortization — — 136 — 136 Merger-related and restructuring costs 67 — 136 — 203 Total costs and expenses 67 — 19,391 — 19,458 Operating Income (Loss) (67) — 4,306 — 4,239 Equity in pretax income of consolidated subsidiaries 3,172 4,565 — (7,737) — Interest income (expense), net (238) (1,416) 253 — (1,401) Other income (expense), net 121 (1) 30 — 150 Income before income taxes 2,988 3,148 4,589 (7,737) 2,988 Income tax provision (1,144) (1,193) (1,111) 2,304 (1,144) Net income 1,844 1,955 3,478 (5,433) 1,844 Less: Net income attributable to noncontrolling interests — — — — — Net income attributable to TWC shareholders $ 1,844 $ 1,955 $ 3,478 $ (5,433) $ 1,844 Condensed Consolidating Statement of Comprehensive Income for the Year Ended December 31, 2015 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Net income $ 1,844 $ 1,955 $ 3,478 $ (5,433) $ 1,844 Change in accumulated unrealized losses on pension benefit obligation, net of tax (39) — — — (39) Change in accumulated deferred gains (losses) on cash flow hedges, net of tax (50) — — — (50) Other changes (1) — (1) 1 (1) Other comprehensive loss (90) — (1) 1 (90) Comprehensive income 1,754 1,955 3,477 (5,432) 1,754 Less: Comprehensive income attributable to noncontrolling interests — — — — — Comprehensive income attributable to TWC shareholders $ 1,754 $ 1,955 $ 3,477 $ (5,432) $ 1,754 Condensed Consolidating Statement of Operations for the Year Ended December 31, 2014 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Revenue $ — $ — $ 22,812 $ — $ 22,812 Costs and expenses: Programming and content — — 5,294 — 5,294 Sales and marketing — — 2,192 — 2,192 Technical operations — — 1,530 — 1,530 Customer care — — 839 — 839 Other operating — — 4,729 — 4,729 Depreciation — — 3,236 — 3,236 Amortization — — 135 — 135 Merger-related and restructuring costs 66 — 159 — 225 Total costs and expenses 66 — 18,114 — 18,180 Operating Income (Loss) (66) — 4,698 — 4,632 Equity in pretax income of consolidated subsidiaries 3,516 4,842 — (8,358) — Interest income (expense), net (202) (1,426) 209 — (1,419) Other income, net — 6 29 — 35 Income before income taxes 3,248 3,422 4,936 (8,358) 3,248 Income tax provision (1,217) (1,284) (1,287) 2,571 (1,217) Net income 2,031 2,138 3,649 (5,787) 2,031 Less: Net income attributable to noncontrolling interests — — — — — Net income attributable to TWC shareholders $ 2,031 $ 2,138 $ 3,649 $ (5,787) $ 2,031 Condensed Consolidating Statement of Comprehensive Income for the Year Ended December 31, 2014 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Net income $ 2,031 $ 2,138 $ 3,649 $ (5,787) $ 2,031 Change in accumulated unrealized losses on pension benefit obligation, net of tax (369) — — — (369) Change in accumulated deferred gains (losses) on cash flow hedges, net of tax 1 — — — 1 Other comprehensive loss (368) — — — (368) Comprehensive income 1,663 2,138 3,649 (5,787) 1,663 Less: Comprehensive income attributable to noncontrolling interests — — — — — Comprehensive income attributable to TWC shareholders $ 1,663 $ 2,138 $ 3,649 $ (5,787) $ 1,663 Condensed Consolidating Statement of Operations for the Year Ended December 31, 2013 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Revenue $ — $ — $ 22,120 $ — $ 22,120 Costs and expenses: Programming and content — — 4,950 — 4,950 Sales and marketing — — 2,048 — 2,048 Technical operations — — 1,500 — 1,500 Customer care — — 766 — 766 Other operating — — 4,876 — 4,876 Depreciation — — 3,155 — 3,155 Amortization — — 126 — 126 Merger-related and restructuring costs — 3 116 — 119 Total costs and expenses — 3 17,537 — 17,540 Operating Income (Loss) — (3) 4,583 — 4,580 Equity in pretax income of consolidated subsidiaries 3,273 3,659 — (6,932) — Interest expense, net (235) (501) (816) — (1,552) Other income (expense), net 1 (5) 15 — 11 Income before income taxes 3,039 3,150 3,782 (6,932) 3,039 Income tax provision (1,085) (1,139) (973) 2,112 (1,085) Net income 1,954 2,011 2,809 (4,820) 1,954 Less: Net income attributable to noncontrolling interests — — — — — Net income attributable to TWC shareholders $ 1,954 $ 2,011 $ 2,809 $ (4,820) $ 1,954 Condensed Consolidating Statement of Comprehensive Income for the Year Ended December 31, 2013 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Net income $ 1,954 $ 2,011 $ 2,809 $ (4,820) $ 1,954 Change in accumulated unrealized losses on pension benefit obligation, net of tax 604 — — — 604 Change in accumulated deferred gains (losses) on cash flow hedges, net of tax 104 — — — 104 Other changes (1) — (1) 1 (1) Other comprehensive income (loss) 707 — (1) 1 707 Comprehensive income 2,661 2,011 2,808 (4,819) 2,661 Less: Comprehensive income attributable to noncontrolling interests — — — — — Comprehensive income attributable to TWC shareholders $ 2,661 $ 2,011 $ 2,808 $ (4,819) $ 2,661 Condensed Consolidating Statement of Cash Flows for the Year Ended December 31, 2015 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Cash provided (used) by operating activities $ (139) $ (1,499) $ 8,177 $ — $ 6,539 INVESTING ACTIVITIES Capital expenditures — — (4,446) — (4,446) Purchases of investments — (4) — — (4) Proceeds from sale, maturity and collection of investments 1 — 2 — 3 Acquisition of intangible assets — (15) (36) — (51) Investments in (distributions and sale Other investing activities 119 — 34 — 153 Cash provided (used) by investing activities 120 (19) (4,446) — (4,345) FINANCING ACTIVITIES Short-term repayments, net (507) — — — (507) Repayments of long-term debt (500) — — — (500) Repayments of long-term debt assumed in Dividends paid (865) — — — (865) Proceeds from exercise of stock options 129 — — — 129 Excess tax benefit from equity-based compensation 92 — — — 92 Taxes paid in cash in lieu of shares issued for equity-based compensation — — (72) — (72) Net change in investments in and amounts due to and from consolidated subsidiaries 2,091 1,518 (3,609) — — Other financing activities (1) — (7) — (8) Cash provided (used) by financing activities 439 1,518 (3,688) — (1,731) Increase in cash and equivalents 420 — 43 — 463 Cash and equivalents at beginning of year 481 — 226 — 707 Cash and equivalents at end of year $ 901 $ — $ 269 $ — $ 1,170 Condensed Consolidating Statement of Cash Flows for the Year Ended December 31, 2014 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Cash provided (used) by operating activities $ (254) $ (1,345) $ 7,949 $ — $ 6,350 INVESTING ACTIVITIES Capital expenditures — — (4,097) — (4,097) Purchases of investments — (2) — — (2) Proceeds from sale, maturity and collection of investments 18 1 — — 19 Acquisition of intangible assets — (3) (36) — (39) Other investing activities — (2) 29 — 27 Cash provided (used) by investing activities 18 (6) (4,104) — (4,092) FINANCING ACTIVITIES Short-term borrowings, net 507 — — — 507 Repayments of long-term debt (1,750) — — — (1,750) Dividends paid (857) — — — (857) Repurchases of common stock (259) — — — (259) Proceeds from exercise of stock options 226 — — — 226 Excess tax benefit from equity-based compensation 141 — — — 141 Taxes paid in cash in lieu of shares issued for equity-based compensation — — (76) — (76) Net change in investments in and amounts due to and from consolidated subsidiaries 2,394 1,351 (3,745) — — Other financing activities (1) — (7) — (8) Cash provided (used) by financing activities 401 1,351 (3,828) — (2,076) Increase in cash and equivalents 165 — 17 — 182 Cash and equivalents at beginning of year 316 — 209 — 525 Cash and equivalents at end of year $ 481 $ — $ 226 $ — $ 707 Condensed Consolidating Statement of Cash Flows for the Year Ended December 31, 2013 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Cash provided (used) by operating activities $ (188) $ (595) $ 6,536 $ — $ 5,753 INVESTING ACTIVITIES Capital expenditures — — (3,198) — (3,198) Business acquisitions, net of cash acquired — (429) 6 — (423) Purchases of investments (575) (13) — — (588) Proceeds from sale, maturity and collection of investments 726 — — — 726 Acquisition of intangible assets — (3) (37) — (40) Other investing activities — 9 38 — 47 Cash provided (used) by investing activities 151 (436) (3,191) — (3,476) FINANCING ACTIVITIES Repayments of long-term debt (1,500) — — — (1,500) Repayments of long-term debt assumed in acquisitions — — (138) — (138) Redemption of mandatorily redeemable preferred equity — (300) — — (300) Dividends paid (758) — — — (758) Repurchases of common stock (2,509) — — — (2,509) Proceeds from exercise of stock options 138 — — — 138 Excess tax benefit from equity-based compensation 92 — 1 — 93 Taxes paid in cash in lieu of shares issued for equity-based compensation — — (68) — (68) Net change in investments in and amounts due to and from consolidated subsidiaries 2,725 1,331 (4,056) — — Other financing activities (9) — (5) — (14) Cash provided (used) by financing activities (1,821) 1,031 (4,266) — (5,056) Decrease in cash and equivalents (1,858) — (921) — (2,779) Cash and equivalents at beginning of year 2,174 — 1,130 — 3,304 Cash and equivalents at end of year $ 316 $ — $ 209 $ — $ 525 |
ACCOUNTING POLICIES (Policies)
ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of Consolidation Policy | T he consolidated financial statements include all of the assets, liabilities, revenue, expenses and cash flows of TWC and all entities in which TWC has a controlling voting interest. T he consolidated financial statements include the results of TWE-A/N only for the TWE-A/N cable systems that are controlled by TWC and for which TWC holds an economic interest. Intercompany accounts and transactions between consolidated companies have been eliminated in consolidation. |
Use of Estimates Policy | The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and footnotes thereto. Actual results could differ from those estimates. Significant estimates inherent in the preparation of the consolidated financial statements include accounting for allowances for doubtful accounts, depreciation and amortization, business combinations, derivative financial instruments, pension benefits, equity-based compensation, income taxes, loss contingencies , certain programming arrangements and asset impairments . Allocation methodologies used to prepare the consolidated financial statements are based on estimates and have been described in the notes, where appropriate. |
Reclassifications Policy | Certain reclassifications have been made to the prior year financial information to conform to the current year presentation , including adoption of two recent accounting standards as further deta iled in Note 2 . |
Cash and Equivalents Policy | Cash and equivalents include money market funds, overnight deposits and other investments that are readily convertible into cash and have origin al maturities of three months or less. Cash equivalents are carried at cost, which approximates fair value. |
Accounts Receivable Policy | Accounts receivable are recorded at net realizable value. A n allowance for doubtful accounts is maintained , which is determined after considering past collection experience, aging of accounts receivable, general economic factors and other considerations . Accounts receivable are written off when it is determined that the balance owed will not be collected, based on the age of the receivable and other considerations . |
Investments Policy (including impairment policy) | Investments in companies in which TWC has significant influence, but less than a controlling interest, are accounted for using the equity method of accounting . Under the equity method of accounting, only TWC's investment in and amounts due to and from the equity investee are included in the consolidated balance sheet; only TWC's share of the investee's earnings (losses) is included in the consolidated statement of operations; and only the dividends, cash distributions, loans or other cash received from the investee, additional cash investments, loan repayments or other cash paid to the investee are included in the consolidated statement of cash flows. T he carrying value of investments accounted for using the equity method of accounting is adjusted downward to reflect any other-than-temporary declines in value. A subjective aspect of accounting for investments involves determining whether an other -than-temporary decline in value of an investment has been sustained. In making this determination, all available information (e.g., budgets, business plans, financial statements, etc.) in addition to quoted market prices, if any, is evaluated . Factors indicative of an other -than-temporary decline include recurring operating losses, credit defaults and subsequent rounds of financing at an amount below the cost basis of the Company's investment. This list is not all-inclusive and all known quantitative and qualitative factors are weighed in determining if an other -than-temporary decline in value of an investment has occurred. If it has been determined that an investment has sustained an other -than-temporary decline in value, the investment is written down to fair value with a charge to earnings. |
Long-Lived Assets (including impairment policy) | Property, plant and equipment are stated at cost , and depreciation on these assets is provided using the straight-line method over their estimated useful lives . Costs associated with the construction of transmission and distribution facilities are capitalized. With respect to customer premise equipment, which includes set-top boxes and high-speed data and telephone modems, installation costs are capitalized only upon the initial deployment of these assets. All costs incurred in subsequent disconnects and reconnects of previously installed customer premise equipment are expensed as incurred . Standard capitalization rates are used to capitalize installation activities. Significant judgment is involved in the development of these capitalization standards, including the average time required to perform an installation and the determination of the nature and amount of indirect costs to be capitalized. The capitalization standards are reviewed at least annually and adjusted, if necessary, based on comparisons to actual costs incurred. G enerally , expenditures for tangible fixed assets having a useful life of greater than one year are capitalized . Capitalized costs include direct material, labor and overhead, as well as interest . T he costs associated with the repair and maint enance of existing tangible fixed assets are expensed as incurred. F inite- lived intangible assets consist primarily of customer relationships , ca ble franchise renewals and access rights . Acquired customer relationships are capitalized and amortized over their estimated useful lives and costs to negotiate and renew cable franchise rights are capitalized and amortized over the term of the new franchise agreement. Long-lived assets (e.g., property, plant and equipment and finite-lived intangible assets) do not require an annual impairment test; instead, long-lived assets are tested for impairment upon the occurrence of a triggering event. Triggering events include the more likely than not disposal of a portion of such assets or the occurrence of an adverse change in the market involving the business employing the related assets. Once a triggering event has occurred, the impairment test is based on whether the intent is to hold the asset for continued use or to hold the asset for sale. If the intent is to hold the asset for continued use, the impairment test first requires a comparison of estimated undiscounted future cash flows generated by the asset group against the carrying value of the asset group. If the carrying value of the asset group exceeds the estimated undiscounted future cash flows, the asset would be deemed to be impaired. The impairment charge would then be measured as the difference between the estimated fair value of the asset and its carrying value. Fair value is generally determined by discounting the future cash flows associated with that asset. If the intent is to hold the asset for sale and certain other criteria are met (e.g., the asset can be disposed of currently, appropriate levels of authority have approved the sale, and there is an active program to locate a buyer), the impairment test involves comparing the asset's carrying value to its estimated fair value. To the extent the carrying value is greater than the asset's estimated fair value, an impairment charge is recognized for the difference. Significant judgments in this area involve determining whether a triggering event has occurred, determining the future cash flows for the assets involved and selecting the appropriate discount rate to be applied in determining estimated fair value . |
Indefinite-Lived Intangible Assets and Goodwill Policy (including impairment policy) | I ndefinite-lived intangible assets consist of cable franchise rights that are acquired in an acquisition of a business. Goodwill is recorded for the excess of the acquisition cost of an acquired entity over the estimated fair value of the ide ntifiable net assets acquired. C able franchise rights and goodwill are not amortized . At least annually, separate tests are performed to determine if the Company's indefinite - lived intangible assets (primarily cable franchise rights) and goodwill are impaired. Under th e accounting rules , a qualitative assessment may be performed to determine if an impairment is more likely than not to have occurred. If an impairment is more likely than not to have occurred, then a quantitative assessment is required, which may or may not result in an impairment charge. The determination of whether an impairment is more likely than not to have occurred requires significant judgment regarding potential changes in valuation inputs. |
Business Combinations Policy | Upon the acquisition of a business, the fair value of the assets acquired and liabilities assumed must be estimated . This requires judgments regarding the identification of acquired assets and liabilities assumed, some of which may not have been previously recorded by the acquired business, as well as judgments regarding the valuation of all identified acquired assets and assumed liabilities. The assets acquired and liabilities assumed are determined by reviewing the operations, interviewing management and reviewing the financial, contractual and regulatory information of the acquired business. Once the acquired assets and assumed liabilities are identified, the fair values of the assets and liabilities are estimated using a variety of approaches that require significant judgments. For example, intangible assets are typically valued using a discounted cash flow (“DCF”) analysis, which requires estimates of the future cash flows that are attributable to the intangible asset. A DCF analysis also requires significant judgments regarding the selection of discount rates that are intended to reflect the risks that are inherent in the projected cash flows, the determination of terminal growth rates, and judgments about the useful life and pattern of use of the underlying intangible asset. As another example, the valuation of acquired property, plant and equipment requires judgments about current market values, replacement costs, the physical and functional obsolescence of the asset s and their remaining useful li ves . A failure to appropriately assign fair values to acquired assets and assumed liabilities could significantly impact the amount and timing of future depreciation and amortization expense, as well as significantly overstate or understate assets or liabilities. |
Derivative Financial Instruments Policy | D erivative financial instruments are recognized in the consolidated balance sheet as either assets or liabilities at fair value and are designated, if certain conditions are met, as either (a) a hedge of the exposure to changes in the fair value of a recognized asset or liability or an unrecognized firm commitment (a “fair value hedge”) or (b) a hedge of the exposure to variable cash flows of a forecasted transaction or a hedge of the foreign currency exposure of a forecasted transaction denominated in a foreign currency (a “cash flow hedge”). For a derivative financial instrument designated as a fair value hedge (e.g., the Company's interest rate swaps) , the gain or loss on the derivative financial instrument is recognized in earnings in the period of change together with the offsetting loss or gain on the hedged item attributable to the risk being hedged. As a result, the consolidated statement of operations includes the impact of changes in the fair value of both the derivative financial instrument and the hedged item, which reflects in earnings the extent to which the hedge is ineffective in achieving offsetting changes in fair value. For a derivative financial instrument designated as a cash flow hedge (e.g., the Company's cross-currency swaps) , the effective portion of the gain or loss on the derivative financial instrument is initially reported in equity as a component of accumulated other comprehensive loss, net , and subsequently reclassified into earnings when the hedged item (e.g., a forecasted transaction denominated in a foreign currency) affects earnings. The ineffective portion of the gain or loss is rep orted in earnings immediately. D erivative financial instruments are used to manage the risks associated with fluctuations in interest rates and foreign currency exchange rates and are not enter ed into f or speculative or trading purposes. T he fair value of interest rate swaps is determined using a DCF analysis based on the terms of the contract. This valuation requires estimates of future interest rates and judgments about the future credit worthiness of the Company and each counterparty over the terms of the contracts. Similarly, the fair value of cross - currency swaps is determined using a DCF analysis based on the terms of the contracts. This valuation requires estimates of future interest rates, forward exchange rates and judgments about the future credit worthiness of the Company and each counterparty over the terms of the contracts. |
Fair Value Measurements Policy | The fair value of an asset or liability is based on the assumptions that market participants would use in pricing the asset or liability. Valuation techniques consistent with the market approach, income approach and/or cost approach are used to measure fair value. A three-tiered fair value hierarchy is followed when determining the inputs to valuation techniques. The fair value hierarchy prioritizes the inputs to valuation techniques into three broad levels in order to maximize the use of observable inputs and minimize the use of unobservable inputs. The levels of the fair value hierarchy are as follows: Level 1: consists of financial instruments whose values are based on quoted market prices for identical financial instruments in an active market. Level 2: consists of financial instruments whose values are determined using models or other valuation methodologies that utilize inputs that are observable either directly or indirectly, including ( i ) quoted prices for similar assets or liabilities in active markets, (ii) quoted prices for identical or similar assets or liabilities in markets that are not active, (iii) pricing models whose inputs are observable for substantially the full term of the financial instrument and (iv) pricing models whose inputs are derived principally from or corroborated by observable market data through correlation or other means for substantially the full term of the financial instrument. Level 3: consists of financial instruments whose values are determined using pricing models that utilize significant inputs that are primarily unobservable, DCF methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. |
Pension Plans Policy | TWC sponsors the TWC Pension Plan (as defined in Note 13 ) and the Union Pension Plan (as defined in Note 13 ), both qualified defined benefit pension plans, that together provide pension benefits to a majority of the Company's employees. TWC also provides a nonqualified defined benefit pension plan for certain employees. Pension benefits are based on formulas that reflect the employees' years of service and compensation during their employment period. P ension expense is determined using certain assumptions, including the expected long-term rate of return on plan assets, discount rate and expected rate of compensation in creases. |
Equity-Based Compensation Policy | The cost of employee services received in exchange for an award of equity instruments is measured based on the grant date fair value of the award. The cost of awards not subject to performance-based vesting conditions is recognized on a straight-line basis over the requisite service period and , for awards subject to performance-based vesting conditions deemed probable of being met, the cost is recognized over the requisite service period for each separately vesting tranche of awards . T he Black-Scholes model is used to estimate the grant date fair value of a stock option. Because the option-pricing model requires the use of subjective assumptions, changes in these assumptions can materially affect the fair value of stock options granted. The volatility assumption is calculated using the implied volatility of TWC traded options. The expected term, which represents the period of time that options are expected to be outstanding, is estimated based on the historical exercise experience of TWC employees. The risk-free rate assumed in valuing the stock options is based on the U.S. Treasury yield curve in effect at the time of grant for the expected term of the option. T he expected dividend yield percentage is determined by dividing the expected annual dividend by the market price of TWC c om mon stock at the date o f grant. |
Segments Policy | Public companies are required to disclose certain information about their reportable operating segments. Operating segments are defined as significant components of an enterprise for which separate financial information is available and is evaluated on a regular basis by the chief operating decision makers in deciding how to allocate resources to an individual operating segment and in assessing performance of the operating segment. The Company classifie s its operations into three reportable segments : Residential Services, Business Services and Other Operations. |
Revenue and Costs Policy | Revenue R evenue consists of the revenue generated by each of the Company's reportable segments: Residential Services, Business Services and Other Operations. Residential S ervices segment revenue consists of ( i ) video revenue, including subscriber fees received from residential customers for various tiers or packages of video programming services, related equipment rental charges, installation charges , broadcast and sports fees and fees collected on behalf of local franchising authorities and the Federal Communications Commission , as well as revenue from the sale of premium networks, transactional video-on-demand (e.g., events and movies) and digital video recorder service; (ii) high-speed data revenue, including subscriber fees received from residential customers for high-speed data services and related equipment rental and installation charges; (iii) voice revenue, including subscriber fees received from residential customers for voice services , along with related installation charges , as well as fees collected on behalf of governmental authorities ; and (iv) other revenue , including revenue from security and home management services and other residential subscriber-related fees. Business S ervices segment revenue consists of ( i ) video revenue, including the same fee categories received from business video subscribers as described above under residential video revenue; (ii) high-speed data revenue, including subscriber fees received from business customers for high-speed data services and related installation charges, as well as amounts generated by the sale of commercial networking and point-to-point transport services , such as Metro Ethernet services ; (iii) voice revenue, including subscriber fees received from business customers for voice services , along with related installation charges , as well as fees collected on behalf of governmental authorities; (iv) wholesale transport revenue, including amounts generated by the sale of point-to-point transport services offered to wireless telephone providers (i.e., cell tower backhaul) and other telecommunications carriers ; and (v) other revenue , including revenue from enterprise-class, cloud-enabled hosting, managed applications and services and other business subscriber-related fees. Other Operations segment revenue consists of advertising revenue and other revenue. Advertising revenue is generated through the sale of video and online advertising inventory to local, regional and national advertising customers. Other revenue primarily includes ( i ) fees received from distributors of the Company's regional sports networks that carry Los Angeles Lakers ' basketball games and other sports programming (Time Warner Cable SportsNet and Time Warner Cable Deportes ); (ii) fees paid to TWC primarily by A/N for (a) the ability to distribute the Company's high-speed data service and (b) TWC's management of certain functions, including, among others, the acquisition of programming rights, as well as the provision of certain functions, including engineering; (iii) home shopping network-related revenue (including commissions earned on the sale of merchandise and carriage fees) ; and (iv) beginning in 2014, fees received from distributors of SportsNet LA . Revenue Recognition Residential and b usiness services subscriber fees are recorded as revenue in the period during which the service is provided. Residential and business services revenue received from subscribers who purchase bundled services at a discounted rate is allocated to each product in a pro-rata manner based on the individual product's selling price (generally, the price at which the product is regularly sold on a standalone basis). Revenue recognition for bundled services is discussed further in “—Multiple-element Transactions—Sales of Multiple Products or Services” below. Installation revenue obtained from traditional cable service connections is recognized as a component of residential and business services revenue when the connections are completed, as installation revenue recognized is less than the related direct selling costs. Advertising revenue is recognized in the period during which the advertisements are exhibited. Fees paid to TWC for the ability to distribute TWC's services are recognized as revenue in the period in which TWC's services are distributed to a consumer. Fees received for managing certain functions for A/N are recognized as revenue ratably over the year, which approximates the period in which management functions are performed. Home shopping network-related revenue is recognized as revenue in the period during which the merchandise is sold or the carriage fees are earned. In the normal course of business, the Company acts as or uses an intermediary or agent in executing transactions with third parties. The accounting issue presented by these arrangements is whether revenue should be reported based on the gross amount billed to the ultimate customer or on the net amount received from the customer after commissions and other payments to third parties. To the extent revenue is recorded on a gross basis, any commissions or other payments to third parties are recorded as expense so that the net amount (gross revenue less expense) is reflected in o perating i ncome. Accordingly, the impact on o perating i ncome is the same whether the revenue was recorded on a gross or net basis. As an example, TWC is assessed franchise fees by franchising authorities, which are passed on to the customer. The accounting issue presented by these arrangements is whether the revenue should be reported based on the gross amount billed to the ultimate customer or on the net amount received from the customer after payments to franchising authorities. I n instances where the fees are being assessed directly to the Company, amounts paid to governmental authorities and amounts received from customers are recorded on a gross basis. That is, amounts paid to governmental authorities are recorded as operating costs and expenses and amounts received from customer s are recorded as revenue. Operating Costs and Expenses P rogramming, high-speed data connectivity and voice network costs are recorded as the services are provided. P rogramming costs are recorded based on the contractual agreements with programming vendors , which are generally multi-year agreements under which payments are made to programming vendors at agreed upon rates based on the number of subscribers to which programming service s are provided . If a programming contract expires prior to the entry into a new agreement and the service continues to be distributed , programming costs are estimated during contract negotiations consider ing previous contractual rates, inflation and the status of the negotiations. When the programming contract terms are finalized, an adjustment to programming expense is recorded, if necessary, to reflect the terms of the new contract. Es timates are also made in the recognition of programming expense related to other items, such as the accounting for free periods and credits from service interruptions, as well as the allocation of consideration exchanged between the parties in multiple-element transactions. Additionally, judgments are also required when multiple services are purchased from the same programming vendor. In these scenarios, the total consideration provided to the programming vendor is allocated to the various services received based upon their respective estimated fair values. Because multiple services from the same programming vendor may be received over different contractual periods and may have different contractual rates, the allocation of consideration to the individual services may have an impact on the timing of expense recognition. Accounting for consideration exchanged between the parties in multiple-element transactions is discussed further in “—Multiple-element Transactions—Contemporaneous Purchases and Sales” below. Content acquisition costs for the Los Angeles Lakers' basketball games and Los Angeles Dodgers' baseball games are recorded as games are exhibited over the applicable season. Launch fees received from programming vendors are recognized as a reduction of expense on a straight-line basis over the term of the related programming arrangement. Amounts received from programming vendors representing the reimbursement of marketing costs are recognized as a reduction of marketing expense as the marketing services are provided. Advertising costs are expensed upon the first exhibition of the related advertisements. Multiple-element Transactions Multiple-element transactions involve situations where judgment must be exercised in determining the fair value of the different elements in a bundled transaction. As the term is used here, multiple-element transactions can involve ( i ) c ontemporaneous purchases and sales (e.g., advertising services are sold to a customer and at the same time programming services are purchased ) and/or (ii) s ales of multiple products and/or services (e.g., video, high-speed data and voice services are sold to a customer) . Contemporaneous Purchases and Sales In the normal course of business, TWC enters into multiple-element transactions where the Company is simultaneously both a customer and a vendor with the same counterparty. For example, when negotiating the terms of programming purchase contracts with cable networks, the sale of advertising to the same cable network may be negotiated at the same time . Arrangements, although negotiated contemporaneously, may be documented in one or more contracts. The accounting policy for each transaction negotiated contemporaneously is to record each element of the transaction based on the respective estimated fair values of the products or services purchased and the products or services sold. The judgments made in determining fair value in such transactions impac t the amount of revenue , expenses and net income recognized over the respective terms of the transactions, as well as the respective periods in which they are recognized. In determining the fair value of the respective elements, quoted market prices (where available), historical transactions or comparable cash transactions are considered . The most frequent transactions of this type involve funds received from vendors. C ash consideration received from a vendor is recorded as a reduction in the price of the vendor's product unless ( i ) the consideration is for the reimbursement of a specific, incremental, identifiable cost incurred , in which case the cash consideration received would be recorded as a reduction in such cost , or (ii) an identifiable benefit in exchange for the consideration is provided , in which case revenue would be recognized for this element. With respect to vendor advertising arrangements being negotiated simultaneously with the same cable network, an assessment is performed to determine whether each piece of the arrangement is at fair value. The factors that are considered in determining the individual fair value of the programming vary from arrange ment to arrangement and include ( i ) the existence of a “most-favored-nation” clause or comparable assurances as to fair market value with respect to programming , (ii) a comparison to fees paid under a prior contract and (iii) a comparison to fees paid for similar networks . In determining the fair value of the advertising arrangement, advertising rates paid by other advertisers on the Company's systems with similar terms are considered . Sales of Multiple Products or Services If sales contracts are entered into for the sale of multiple products or services, the standalone selling price for each deliverable in the transaction is evaluated . For example, video, high-speed data and voice services are sold to subscribers in a bundled package at a rate lower than if the subscriber purchases each product on an individual basis. R evenue received from such subscribers is allocated to each product in a pro-rata manner based on the standalone selling price of each of the respective services on an individual basis. As another example, i f a subscriber moves from a bundled package containing two services to a bundled package containing three services, the increase in the total revenue received is not attributed to the additional service. Rather, the total revenue received from such subscribers are allocated to each of the three products in a pro-rata manner based on the relative selling price of each of the respective services on an individual basis. |
Income Taxes Policy | Income taxes are provided using the asset and liability method . Under this method, income taxes (i.e., deferred income tax assets, deferred income tax liabilities, taxes currently payable/refunds receivable and tax expense) are recorded based on amounts refundable or payable in the current year and include the results of any difference between GAAP and tax reporting. Deferred income taxes reflect the tax effect of net operating losses, capital losses, general business credit carryforwards and the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial statement and income tax purposes, based upon enacted tax laws and expected tax rates that will be in effect when the temporary differences reverse . Valuation allowances are established when management determines that it is more likely than not that some portion or the entire deferred tax asset will not be realized. The financial effect of changes in tax laws or rates is accounted for in the period of enactment . From time to time, transactions occur in which the tax consequences may be subject to uncertainty. Significant judgment is required in assessing and estimating the tax consequences of these transactions. Income tax returns are prepared and filed based on interpretation of tax laws and regulations. In the normal course of business, income tax returns are subject to examination by various taxing authorities. Such examinations may result in future tax, interest and penalty assessments by these taxing authorities. In determining the income tax provision for financial reporting purposes, a reserve for uncertain income tax positions is established unless it is determined that such positions are more likely than not to be sustained upon examination, ba sed on their technical merits. There is considerable judgment involved in determining whether positions taken on the income tax return are more likely than not to be sustained. Income tax reserve estimates are adjusted periodically because of ongoing examinations by, and settlements with, the various taxing authorities, as well as changes in tax laws, regulations and interpretations. The consolidated income tax provision for any given year includes adjustments to prior year income tax accruals that are considered appropriate and any related estimated interest. W hen applicable, interest and penalties are recognized on uncertain income tax positions as part of the income tax provision . |
Legal Contingencies Policy | The Company is subject to legal, regulatory and other proceedings and claims that arise in the ordinary course of business. A n estimated liability is recorded for those proceedings and claims arising in the ordinary course of business when the loss from such proceedings and claims becomes probable and reasonably estimable. O utstanding claims are reviewed with internal and external counsel to assess the probability and the estimates of loss , including the possible range of an estimated loss . The risk of loss is re assessed as new information becomes available and liabilities are adjusted as appropriate. The actual cost of resolving a claim may be substantially different from the amount of the liability recorded. Differences between the estimated and actual amounts determined upon ultimate resolution, individually or in the aggregate, are not expected to have a material adverse effect on the consolidated financial position but could possibly be material to the consolidated results of operations or cash flow s for any one period. |
SUMMARY OF SIGNIFICANT ACCOUN30
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary Of Significant Accounting Policies Table [Abstract] | |
Schedule of Changes in the Allowance for Doubtful Accounts | Changes in the allowance for doubtful accounts from January 1 through December 31 are presented below (in millions): 2015 2014 2013 Balance at beginning of year $ 109 $ 77 $ 65 Provision for bad debts (a) 212 275 249 Write-offs, net of recoveries (227) (243) (237) Balance at end of year $ 94 $ 109 $ 77 —————————— Provision for bad debts includes amounts charged to expense associated with the allowance for doubtful accounts and excludes collection expenses and the benefit from l ate fees billed to subscribers. |
Schedule of Property, Plant and Equipment and Related Accumulated Depreciation | P roperty, plant and equipment and related accumulated depreciation a s of December 31, 2015 and 2014 consisted of the following : Estimated December 31, Useful 2015 2014 Lives (in millions) (in years) Land, buildings and improvements (a) $ 2,093 $ 2,038 1-20 Distribution systems (b) 27,126 24,951 3-25 Converters and modems 6,743 6,141 3-5 Capitalized software costs (c) 2,924 2,572 3-5 Vehicles and other equipment 2,466 2,374 3-10 Construction in progress 424 476 Property, plant and equipment, gross 41,776 38,552 Accumulated depreciation (24,831) (22,562) Property, plant and equipment, net $ 16,945 $ 15,990 —————————— Land, buildings and improvements includes $174 million and $173 million related to land as of December 31, 2015 and 2014 , respectively, which is not depreciated. The weighted-average useful life for buildings and improvements is approximately 17.73 years. The weighted-average useful li fe for distribution systems is approximately 13.22 years . Capitalized software costs reflect certain costs incurred for the development of internal use software, including costs associated with coding, software configuration, upgrades and enhancements. These costs, net of accumulated depreciation, totaled $807 million and $803 million as of December 31, 2015 and 2014 , respectively. Depreciation of capitalized software costs was $361 million in 2015 , $317 million in 2014 and $270 million in 2013 . |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share Table [Abstract] | |
Schedule of Earnings Per Share Reconciliation | Set forth below is a reconciliation of net income attributable to TWC common shareholders per basic and diluted common share for the years ended December 31, 2015 , 2014 and 2013 (in millions, except per share data): Year Ended December 31, 2015 2014 2013 Net income attributable to TWC common shareholders $ 1,825 $ 2,013 $ 1,944 Net income allocated to participating securities (a) 19 18 10 Net income attributable to TWC shareholders $ 1,844 $ 2,031 $ 1,954 Weighted-average basic common shares outstanding 282.6 279.3 287.6 Dilutive effect of nonparticipating equity awards 0.9 1.6 1.9 Dilutive effect of participating equity awards (a) 2.4 2.1 2.2 Weighted-average diluted common shares outstanding 285.9 283.0 291.7 Net income per common share attributable to TWC common shareholders: Basic $ 6.46 $ 7.21 $ 6.76 Diluted $ 6.44 $ 7.17 $ 6.70 —————————— R estricted stock units granted to employees and non-employee directors are considered participating securities with respect to regular quarterly cash dividends. |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Investments Table [Abstract] | |
Schedule of Investments | I nvestments as of December 31, 2015 and 2014 consisted of the following (in millions): December 31, 2015 2014 Equity-method investments (a) $ 62 $ 60 Other investments 3 4 Total investments $ 65 $ 64 —————————— Equity-method investments includes investments in MLB Network, LLC ( 5.3% owned) , iN Demand L . L . C . ( 28.6% owned) and National Cable Communications LLC ( 16.7% owned) . In addition, the Company has an equity-method investment in Sterling Entertainment Enterprises, LLC (doing business as SportsNet New York , 26.8% owned ). The Company has received distributions in excess of its investment in SportsNet New York and has reflected this amount ( $179 million as of December 31, 2015 and 2014 ) in other liabilities in the consolidated balance sheet . |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Intangibles And Goodwill Table [Abstract] | |
Schedule of Intangible Assets by Major Class | I ntangible assets and related accumulated amortization a s of December 31, 2015 and 2014 consisted of the following (in millions): December 31, 2015 December 31, 2014 Accumulated Accumulated Gross Amortization Net Gross Amortization Net Intangible assets subject to amortization: Customer relationships $ 597 $ (353) $ 244 $ 600 $ (262) $ 338 Cable franchise renewals and access rights 306 (138) 168 297 (130) 167 Other 57 (32) 25 42 (24) 18 Total $ 960 $ (523) $ 437 $ 939 $ (416) $ 523 Intangible assets not subject to amortization: Cable franchise rights $ 26,936 $ (922) $ 26,014 $ 26,934 $ (922) $ 26,012 |
Schedule of Changes in Goodwill | Changes in the carrying value of goodwill f rom January 1 through December 31 are presented below (in millions): 2015 2014 Balance at beginning of year $ 3,137 $ 3,196 Acquisition of DukeNet (a) — (61) Other changes and adjustments 2 2 Balance at end of year (b) $ 3,139 $ 3,137 —————————— During the first quarter of 2014, the Company finalized its fair value estimates for certain long-lived assets ( e.g., primarily property, plant and equipment and finite-lived intangible assets) acquired in the acquisition of DukeNet resulting in a net $61 million adjustment to goodwill , which was allocated to each reporting unit based upon relative fair value . There we re no accumulated goodwill impairment charges as of December 31, 2015 and 2014 . |
Schedule of Goodwill by Segment | Goodwill by reportable segment a s of December 31, 2015 and 2014 consisted of the following (in millions): December 31, 2015 2014 Residential Services $ 2,260 $ 2,259 Business Services 785 784 Other Operations 94 94 Total goodwill $ 3,139 $ 3,137 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt Table [Abstract] | |
Schedule of Debt Instruments | D ebt as of December 31, 2015 and 2014 consisted of the follow ing (in millions): Outstanding Balance as of December 31, Maturity 2015 2014 (recast) Senior notes and debentures (a) 2017-2042 $ 22,426 $ 23,029 Revolving credit facility 2017 — — Commercial paper program 2017 — 507 Capital leases 2016-2042 76 85 Total debt 22,502 23,621 Less: Current maturities (b) (5) (1,017) Total long-term debt $ 22,497 $ 22,604 ————————— The weighted-average effective interest rate for the senior notes and debentures as of December 31, 2015 wa s 6.218% and includes the effects of interest rate swaps and cross-currency swaps. Current maturities as of December 31, 2015 include amounts outstanding under capital leases . |
Schedule of Senior Notes and Debentures | N otes and debentures issued by TWC as of December 31, 2015 and 2014 consisted of the following (in millions): Date of Outstanding Balance Interest as of December 31, Issuance Maturity Payment Principal 2015 2014 (recast) 3.500% notes Dec 2009 Feb 2015 Feb/Aug $ 500 $ — $ 501 5.850% notes Apr 2007 May 2017 May/Nov 2,000 2,045 2,075 6.750% notes June 2008 July 2018 Jan/July 2,000 2,002 1,989 8.750% notes Nov 2008 Feb 2019 Feb/Aug 1,250 1,242 1,240 8.250% notes Mar 2009 Apr 2019 Apr/Oct 2,000 2,004 1,992 5.000% notes Dec 2009 Feb 2020 Feb/Aug 1,500 1,485 1,481 4.125% notes Nov 2010 Feb 2021 Feb/Aug 700 696 695 4.000% notes Sep 2011 Sep 2021 Mar/Sep 1,000 992 991 5.750% notes (a) May 2011 June 2031 June 921 913 964 6.550% debentures Apr 2007 May 2037 May/Nov 1,500 1,483 1,482 7.300% debentures June 2008 July 2038 Jan/July 1,500 1,486 1,486 6.750% debentures June 2009 June 2039 June/Dec 1,500 1,455 1,453 5.875% debentures Nov 2010 Nov 2040 May/Nov 1,200 1,171 1,170 5.500% debentures Sep 2011 Sep 2041 Mar/Sep 1,250 1,221 1,220 5.250% notes (b) June 2012 July 2042 July 958 942 996 4.500% debentures Aug 2012 Sep 2042 Mar/Sep 1,250 1,233 1,233 Total (c) $ 20,370 $ 20,968 ————————— Outstanding balance amounts include £619 million valued at $913 m illion as of December 31, 2015 and £619 million valued at $964 m illion as of December 31, 2014 using the exchange rate at each date. Outstanding balance amount s include £639 million valued at $942 m illion as of December 31, 2015 and £640 million valued at $996 m illion as of December 31, 2014 using the exchange rate at each date. The total principal amount as of December 31, 2015 and 2014 is increased by the estimated fair value of net interest rate swap assets of $62 million and $74 million, respectively, and reduced by unamortized debt issuance costs of $89 million and $97 million, respectively, and unamortized discounts of $132 million and $145 million, respectively, in arriving at the total outstanding balance amounts. Capitalized debt issuance costs are amortized over the term of the related debt instrument as a component of interest expense , net . D ebentures issued by TWCE as of December 31, 2015 and 2014 consisted of the following (in millions): Date of Outstanding Balance Interest as of December 31, Issuance Maturity Payment Principal 2015 2014 8.375% debentures Mar 1993 Mar 2023 Mar/Sept $ 1,000 $ 1,019 $ 1,022 8.375% debentures July 1993 July 2033 Jan/July 1,000 1,037 1,039 Total (a) $ 2,056 $ 2,061 ————————— The total principal amount as of December 31, 2015 and 2014 is increased by an unamortized fair value adjustment of $56 million and $61 million, respectively, primarily consisting of the fair value adjustment recognized as a result of the 2001 merger of America Online, Inc. and Time Warner Inc. , in arriving at the total outstanding balance amounts. The fair value adjustment is amortized over the term of the related debt instrument as a reduction to interest expense , net . |
DERIVATIVE FINANCIAL INSTRUME35
DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Derivative Financial Instruments And Fair Value Measurements Table [Abstract] | |
Schedule of Derivative Financial Instruments | The fair value s of assets and liabilities associated with derivative financial instruments recorded in the consolidated balance sheet as of December 31 , 2015 and 2014 consisted of the following (in millions): Assets Liabilities December 31, December 31, 2015 2014 2015 2014 Interest rate swaps (a)(b) $ 69 $ 93 $ 7 $ 19 Cross-currency swaps (a)(c) 90 197 80 — Total $ 159 $ 290 $ 87 $ 19 ————————— I nterest rate swap and cross-currency swap contracts with multiple counterparties are subject to contractual terms that provide for the net settlement of all such contracts with each counterparty , including cash collateral received or paid, through a single payment in the event of default on or termination of any one contract by either party. The fair values of the assets and liabilities associated with interest rate swaps and cross-currency swaps are presented on a gross basis in the consolidated balance sheet and are classified as current or noncurrent based on the maturity date of the respective contract. The fair value of assets associated with interest rate swaps as of December 31, 2015 is recorded in other assets in the consolidated balance sheet. Of the total fair value of assets associated with interest rate swaps as of December 31, 2014 , $1 million is recorded in other current assets with the remainder recorded in other assets in the consolidated balance sheet. The fair values of liabilities associated with interest rate swaps are recorded in other liabilities in the consolidated balance sheet. The fair values of assets and liabilities associated with cross-currency swaps are recorded in other assets and other liabilities, respectively, in t he consolidated balance sheet. |
Schedule of Interest Rate Swap Contract Terms | The following table summarizes the terms of existing fixed to variable interest rate swaps as of December 31, 2015 and 2014 : December 31, 2015 2014 Maturities 2017-2019 2015-2019 Notional amount (in millions) $ 5,600 $ 6,100 Weighted-average pay rate (variable based on LIBOR plus variable margins) 5.41% 4.78% Weighted-average receive rate (fixed) 6.86% 6.58% |
Schedule of Cash Flow Hedge Activity Recognized and Reclassified | The following table summarizes the effect of cash flow hedges on the consolidated statements of income and comprehensive income for the years ended December 3 1 , 2015 , 2014 and 2013 (in millions): Year Ended December 31, 2015 2014 2013 Deferred gains (losses) recognized in other comprehensive income (loss) (effective portion) $ (187) $ (124) $ 209 Deferred gains (losses) reclassified from accumulated other comprehensive loss, net, into other income, net (effective portion) (a) (107) (126) 39 ————————— Deferred gains (losses) on cross-currency swaps we re reclassified from accumulated other comprehensive loss, net , in to other income, net , which offset s the re-measurement gains (losses) recognized in other income, net , on the British pound sterling denominated debt. |
TWC SHAREHOLDERS' EQUITY (Table
TWC SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Time Warner Cable Shareholders Equity Table [Abstract] | |
Schedule of Changes in Common Stock | Changes in common stock from January 1 through December 31 are presented below (in millions): 2015 2014 2013 Balance at beginning of year 280.8 277.9 297.7 Shares issued under the equity-based compensation plan 2.5 4.4 4.2 Shares repurchased and retired — (1.5) (24.0) Balance at end of year 283.3 280.8 277.9 |
Schedule of Common Stock Dividends | TWC 's Board of Directors (“TWC's Board”) declared quarterly cash dividends per share of TWC c ommon s tock in 2015 , 2014 and 2013 as follows (in millions, except per share data): 2015 2014 2013 Per Share Amount Per Share Amount Per Share Amount First Quarter $ 1.50 $ 431 $ 0.75 $ 213 $ 0.65 $ 195 Second Quarter 0.75 216 0.75 215 0.65 190 Third Quarter 0.75 218 0.75 214 0.65 188 Fourth Quarter (a) 0.75 216 0.75 215 0.65 185 Total $ 3.75 $ 1,081 $ 3.00 $ 857 $ 2.60 $ 758 ————————— On December 17, 2015 , TWC's Board declared a quarterly cash dividend of $0.75 per share o f TWC c ommon s tock, payable in cash on January 25, 2016 to stockholders of record at the close of business on January 4, 2016 . |
Schedule of Changes in Accumulated Other Comprehensive Income (Loss), Net | C hanges in accumulated other comprehensive income (loss), net, in cluded in TWC shareholders' equity from January 1 through December 31 are presented below (in millions): Year Ended December 31, 2015 2014 2013 Balance at beginning of year $ (324) $ 44 $ (663) Other comprehensive income (loss) before reclassifications, net of tax (182) (445) 686 Amounts reclassified into earnings, net of tax 92 77 21 Other comprehensive income (loss), net of tax (90) (368) 707 Balance at end of year $ (414) $ (324) $ 44 The following table summarizes the changes in the components of accumulated other comprehensive income (loss), net , included in TWC shareholders' equity from January 1 through December 31 (in millions): 2015 2014 2013 Unrealized losses on pension benefit obligation: Balance at beginning of year $ (473) $ (104) $ (708) Other comprehensive income (loss) before reclassifications, net of tax (65) (368) 558 Amounts reclassified into earnings, net of tax: Amortization of net actuarial loss (prior service credit) (a) 41 (2) 75 Income tax provision (benefit) (15) 1 (29) Amortization of net actuarial loss (prior service credit), net of tax 26 (1) 46 Other comprehensive income (loss), net of tax (39) (369) 604 Balance at end of year $ (512) $ (473) $ (104) Deferred gains (losses) on cash flow hedges: Balance at beginning of year $ 150 $ 149 $ 45 Other comprehensive income (loss) before reclassifications, net of tax (116) (77) 129 Amounts reclassified into earnings, net of tax: Effective portion of (gain) loss on cash flow hedges (b) 107 126 (39) Income tax provision (benefit) (41) (48) 14 Effective portion of (gain) loss on cash flow hedges, net of tax 66 78 (25) Other comprehensive income (loss), net of tax (50) 1 104 Balance at end of year $ 100 $ 150 $ 149 Other changes: Balance at beginning of year $ (1) $ (1) $ — Other comprehensive loss before reclassifications, net of tax (1) — (1) Amounts reclassified into earnings, net of tax — — — Other comprehensive loss, net of tax (1) — (1) Balance at end of year $ (2) $ (1) $ (1) ————————— Amounts are included in the computation of net periodic benefit costs as discussed further in Note 13 . Amounts are recorded in other income, net in the consolidated statement of operations as discussed further in Note 10 . |
EQUITY-BASED COMPENSATION (Tabl
EQUITY-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Equity Based Compensation Table [Abstract] | |
Schedule of Equity-Based Compensation Expense and Related Tax Benefit Recognized | Equity-based compensation expense and the related income tax benefit recognized for the years ended December 31, 2015 , 2014 and 2013 was as follows (in millions): Year Ended December 31, 2015 2014 2013 Equity-based compensation expense recognized: Restricted stock units (a) $ 147 $ 160 $ 89 Stock options 14 22 39 Total equity-based compensation expense (a) $ 161 $ 182 $ 128 Income tax benefit recognized $ 63 $ 71 $ 49 —————————— Amounts in clude $47 million in 2015 and $56 million in 2014 of equity-based compensation expense recognized in merger-related and restructuring costs in the consolidated statement of operations related to certain retention grants (as defined below) . |
Schedule of Restricted Stock Units Activity | The following table summarizes information about unvested RSUs for the year ended December 31, 2015 : Weighted- Number Average of Grant Date Units Value (in millions) Unvested as of December 31, 2014 6.264 $ 112.06 Granted 0.986 179.02 Vested (1.120) 80.85 Forfeited (0.436) 129.20 Unvested as of December 31, 2015 5.694 128.47 |
Schedule of Stock Options Activity | The following table summarizes information about stock options that were outstanding as of December 31, 2015 : Weighted- Weighted- Average Number Average Remaining Aggregate of Exercise Contractual Intrinsic Options Price Term Value (in millions) (in years) (in millions) Outstanding as of December 31, 2014 4.219 $ 75.29 Exercised (1.905) 73.88 Forfeited or expired (0.124) 87.56 Outstanding as of December 31, 2015 2.190 75.83 5.85 $ 240 Exercisable as of December 31, 2015 0.881 63.93 4.47 107 Expected to vest as of December 31, 2015 1.291 83.79 6.77 131 |
Schedule of Stock Options Valuation Assumptions | The table below presents the assumptions used to value stock options a t their grant date for the year ended December 31, 2013 and reflects the weighted average of all awards granted within that year: Expected volatility 26.14% Expected term to exercise from grant date (in years) 5.94 Risk-free rate 1.19% Expected dividend yield 2.97% |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Employee Benefit Plans Table [Abstract] | |
Schedule of Benefit Obligations, Fair Value of Plan Assets and Net Funded Status | Changes in the projected benefit obligation, fair value of plan assets and funded status of the pension plans from January 1 through December 31 are presented below (in millions ): 2015 2014 Projected benefit obligation at beginning of year $ 3,206 $ 2,550 Service cost 230 173 Interest cost 147 144 Actuarial (gain) loss (241) 606 Plan amendment (a) — 3 Benefits paid (b) (151) (270) Projected benefit obligation at end of year $ 3,191 $ 3,206 Accumulated benefit obligation at end of year $ 2,715 $ 2,709 Fair value of plan assets at beginning of year $ 3,106 $ 3,124 Actual return on plan assets (116) 247 Employer contributions 5 5 Benefits paid (b) (151) (270) Fair value of plan assets at end of year $ 2,844 $ 3,106 Funded status $ (347) $ (100) ————————— On February 7, 2014, the TWC Pension Plan was amended to offer a lump sum option to all participants whose benefit commencement date is on or after January 1, 2015. On February 21, 2014, the TWC Pension Plan was amended to provide certain eligible participants and deferred beneficiaries with a voluntary election opportunity during a limited-time period to receive, or to commence receiving, their p lan benefit effective June 1, 2014 in the form of a lump sum cash payment or certain other optional forms of payment. The opportunity to make this voluntary election was available between March 4, 2014 and April 24, 2014. As a result of this amendment, eligible participants received benefit payments of $210 million during 2014 . The projected benefit obligation, accumulated benefit obligation and fair value of plan assets for the qualified pension plans and the nonqualified pension plan as of December 31, 2015 and 2014 consisted of the following (in millions): Qualified Pension Plans Nonqualified Pension Plan December 31, December 31, 2015 2014 2015 2014 Projected benefit obligation $ 3,153 $ 3,166 $ 38 $ 40 Accumulated benefit obligation 2,677 2,670 38 39 Fair value of plan assets 2,844 3,106 — — |
Schedule of Amounts Recognized in the Consolidated Balance Sheet | Pretax a mounts recognized in the consolidated balance sheet as of December 31, 2015 and 2014 consisted of the following (in millions): December 31, 2015 2014 Current liability $ (5) $ (5) Noncurrent liability (342) (95) Total amounts recognized in liabilities $ (347) $ (100) Accumulated other comprehensive income (loss), net: Net actuarial loss $ (862) $ (802) Prior service credit 27 30 Total amounts recognized in TWC shareholders’ equity $ (835) $ (772) |
Schedule of Net Periodic Benefit Costs | The components of net periodic benefit costs for the years ended December 31, 2015 , 2014 and 2013 consisted of the following (in millions): Year Ended December 31, 2015 2014 2013 Service cost $ 230 $ 173 $ 204 Interest cost 147 144 139 Expected return on plan assets (229) (233) (214) Amounts amortized 41 (3) 75 Settlement loss — — 1 Net periodic benefit costs $ 189 $ 81 $ 205 |
Schedule of Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit Costs | Weighted-average assumptions used to determine benefit obligations a s of December 31, 2015 , 2014 and 2013 consisted of the following : 2015 2014 2013 Discount rate 4.74% 4.32% 5.27% Rate of compensation increase 4.25% 4.25% 4.75% Weighted-average assumptions used to determine net periodic benefit cost for the years ended December 31, 2015 , 2014 and 2013 consisted of the following : 2015 2014 2013 Expected long-term rate of return on plan assets 7.50% 7.50% 7.50% Discount rate 4.32% 5.27% 4.31% Rate of compensation increase 4.25% 4.75% 4.75% |
Schedule of Allocation of Pension Assets | The target and actual investment allocation of the qualified pension plans by asset category as of December 31, 2015 and 2014 consisted of the following : Actual Allocation Target as of December 31, Allocation 2015 2014 Return-seeking securities 70.0% 66.0% 68.2% Liability-matching securities 30.0% 33.7% 31.4% Other investments 0.0% 0.3% 0.4% The following table s set forth the investment assets of the qualified pension plans , which exclude accrued investment income and other receivables and accrued liabilities , by level within the fair value hierarchy as of December 31, 2015 and 2014 (in millions): December 31, 2015 Fair Value Measurements Fair Value Level 1 Level 2 Level 3 Cash $ 1 $ 1 $ — $ — Common stocks: Domestic (a) 1,051 1,051 — — International (a) 368 368 — — Commingled equity funds (b) 337 — 337 — Other equity securities (c) 4 4 — — Corporate debt securities (d) 325 — 325 — Commingled bond funds (b) 259 — 259 — U.S. Treasury debt securities (a) 255 255 — — Collective trust funds (e) 89 — 89 — U.S. government agency asset-backed debt securities (f) 34 — 34 — Corporate asset-backed debt securities (g) 8 — 8 — Other fixed-income securities (h) 104 — 104 — Other investments (i) 7 — — 7 Total investments assets 2,842 $ 1,679 $ 1,156 $ 7 Accrued investment income and other receivables (j) 65 Accrued liabilities (j) (63) Fair value of plan assets $ 2,844 December 31, 2014 Fair Value Measurements Fair Value Level 1 Level 2 Level 3 Common stocks: Domestic (a) $ 1,176 $ 1,176 $ — $ — International (a) 412 412 — — Commingled equity funds (b) 348 — 348 — Mutual funds (a) 70 70 — — Other equity securities (c) 3 3 — — Corporate debt securities (d) 361 — 361 — Commingled bond funds (b) 268 — 268 — U.S. Treasury debt securities (a) 194 194 — — Collective trust funds (e) 80 — 80 — U.S. government agency asset-backed debt securities (f) 34 — 34 — Corporate asset-backed debt securities (g) 10 — 10 — Other fixed-income securities (h) 130 — 130 — Other investments (i) 14 4 — 10 Total investments assets 3,100 $ 1,859 $ 1,231 $ 10 Accrued investment income and other receivables (j) 79 Accrued liabilities (j) (73) Fair value of plan assets $ 3,106 ————————— Common stocks , mutual funds and U.S. Treasury debt securities are valued at the closing price reported on the active market on which the i ndividual securities are traded. No single industry comprise d a significant portion of common stock held by the qualified pension plan as of December 31, 2015 and 2014 . Commingled equity funds and commingled bond funds are valued using the net asset value provided by the administrator of the fund. The net asset value is based on the value of the underlying assets owned by the fund, less liabilities, and then divided by the number of units outstanding. Other equity securities consist of preferred stocks, which are valued at the closing price reported on the active market on which the individual securities are traded. Corporate debt securities are valued based on observable prices from the new issue market, benchmark quotes, secondary trading and dealer quotes. An option adjusted spread model is incorporate d to adjust spreads of issues that have early redemption features and final spreads are added to the U.S. Treasury curve. Collective trust funds primarily consist of short-term in vestment strategies comprised of instruments issued or fully guaranteed by the U.S. government and/or its agencies and are valued using the net asset value provided by the administrator of the fund. The net asset value is based on the value of the underlying assets owned by the fund, less liabilities, and t h en divided by the number of units outstanding. U.S. government agency asset-backed debt securities consist of pass-through mortgage-backed securities issued by the Federal Home Loan Mortgage Corporation and the Federal National Mortgage Association valued using available trade information, dealer quotes, market indices and research reports, spreads, bids and offers. Corporate asset-backed debt securities primarily consist of pass-through mortgage-backed securities issued by U.S. and foreign corporations valued using available trade information, dealer quotes, market indices and research reports, spreads, bids and offers. Other fixed-income securities consist of foreign government debt securities , municipal bonds and U.S. government agency debt securities, which are valued based on observable prices from the new issue market, benchmark quotes, secondary trading and dealer quotes. An option adjusted spread model is incorporated to adjust spreads of issues that have early redemption features and final spreads are added to the U.S. Treasury curve. Other investments primarily consist of private equity investments, such as those in limited partnerships that invest in operating companies that are not publicly traded on a stock exchange, and hedge funds. Private equity investments are valued using inputs such as trading multiples of comparable public securities, merger and acquisition activity and pricing data from the most recent equity financing taking into consideration illiquidity. Hedge funds are valued using the net asset value provided by the administrator of the fund, which is based on the value of the underlying assets owned by the fund, less liabilities, and then divided by the number of units outstanding. Accrued investment income and other receivables includes amounts receivable under foreign exchange contracts of $54 million and $67 million as of December 31, 2015 and 2014 , respectively. Accrued liabilities includes amounts accrued under foreign exchange contracts of $54 million and $67 million as of December, 2015 and 2014 , respectively. The fair value of the assets and liabilities associated with the se foreign exchange contracts are presented on a gross basis and are valued using the exchange rates in effect for the applicable currencies as of the valuation date (a Level 1 fair value measurement). |
Schedule of Changes in Pension Assets Measured at Fair Value Using Significant Unobservable Inputs | Changes in the fair value of investment assets valued using significant unobservable inputs (Level 3) from January 1 through December 31 are presented below (in millions): 2015 2014 Balance at beginning of year $ 10 $ 10 Purchases and sales: Purchases 2 2 Sales (7) (2) Sales, net (5) — Actual return on plan assets held at end of year 2 — Balance at end of year $ 7 $ 10 |
MERGER-RELATED AND RESTRUCTUR39
MERGER-RELATED AND RESTRUCTURING COSTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Merger Related And Restructuring Costs Table [Abstract] | |
Schedule of Merger-Related and Restructuring Costs | Merger-related and restructuring costs for the years ended December 31, 2015 , 2014 and 2013 consisted of the following (in millions): Year Ended December 31, 2015 2014 2013 Merger-related costs $ 183 $ 198 $ 13 Restructuring costs 20 27 106 Total merger-related and restructuring costs $ 203 $ 225 $ 119 |
Schedule of Changes in Merger-Related Accruals by Type of Cost | Changes in accruals for merger-related costs from January 1 through December 31 are presented below (in millions): Employee Other Costs Costs Total Remaining liability as of December 31, 2012 $ 7 $ 7 $ 14 Costs incurred — 13 13 Cash paid (4) (17) (21) Remaining liability as of December 31, 2013 3 3 6 Costs incurred 68 75 143 Adjustments (1) — (1) Cash paid (5) (61) (66) Remaining liability as of December 31, 2014 65 17 82 Costs incurred 64 77 141 Costs reimbursed by Charter — (5) (5) Cash paid (82) (83) (165) Remaining liability as of December 31, 2015 (a) $ 47 $ 6 $ 53 ————————— The rem aining $53 million liability as of December 31, 2015 is classified as a current liability in the consolidated balance sheet . |
Schedule of Changes in Restructuring Reserves by Type of Cost | Changes in restructuring reserves from January 1 through December 31 are presented below (in millions): Employee Other Termination Exit Costs Costs Total Remaining liability as of December 31, 2012 $ 24 $ 3 $ 27 Costs incurred 88 18 106 Cash paid (73) (17) (90) Remaining liability as of December 31, 2013 39 4 43 Costs incurred 14 16 30 Adjustments (3) — (3) Cash paid (42) (20) (62) Remaining liability as of December 31, 2014 8 — 8 Costs incurred 20 — 20 Cash paid (16) — (16) Remaining liability as of December 31, 2015 (a) $ 12 $ — $ 12 ————————— Of the remaining liability as of December 31, 2015 , $7 million is classified as a current liability, with the remaining amount classified as a noncurrent liability in the consolidated balance sheet. Amounts are expected to be paid through March 2019 . |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes Table [Abstract] | |
Schedule of Income Tax Provision by Jurisdiction | The c urrent and deferred income tax (benefit) provision for the years ended December 31, 2015 , 2014 and 2013 consisted of the following (in millions): Year Ended December 31, 2015 2014 2013 Federal: Current $ 444 $ 363 $ 631 Deferred 525 681 411 State: Current 107 98 91 Deferred 68 75 (48) Total $ 1,144 $ 1,217 $ 1,085 |
Schedule of Effective Income Tax Rate Reconciliation | The differences between income tax (benefit) provision expected at the U.S. federal statutory income tax rate of 35% and income tax (benefit) provision provided for the years ended December 31, 2015 , 2014 and 2013 consisted of the following (in millions): Year Ended December 31, 2015 2014 2013 Income tax provision at U.S. federal statutory rate $ 1,046 $ 1,137 $ 1,064 State and local taxes, net of federal tax effects 114 112 28 Other (16) (32) (7) Total $ 1,144 $ 1,217 $ 1,085 |
Schedule of Deferred Income Tax Assets and Liabilities | Significant components of deferred income tax liabilities, net, as of December 31, 2015 and 2014 consisted of the following (in millions): December 31, 2015 2014 Cable franchise rights and customer relationships, net $ (8,627) $ (8,298) Property, plant and equipment (4,740) (4,466) Other (100) (133) Deferred income tax liabilities (13,467) (12,897) Net operating loss carryforwards (a) 24 92 Tax credit carryforwards (a) 32 31 Other 604 511 Valuation allowances (b) (23) (28) Deferred income tax assets 637 606 Deferred income tax liabilities, net $ (12,830) $ (12,291) —————————— Net operating loss and tax credit carryforwards expire in varying amounts through 2035 . Aside from certain net operating loss and state tax credit carryforwards for which a valuation allowance has been established, the Company does not expect these carryforwards to expire unutilized. The Company's valuation allowance for deferred income tax assets recorded as of December 31, 2015 and 2014 primarily relates to certain net operating loss and state tax credit carryforwards. The valuation allowance is based upon the Company's assessment that it is more likely than not that a portion of the deferred income tax asset will not be realized. |
Schedule of Changes in Deferred Income Tax Liabilities, Net | Changes in deferred income tax liabilities, net, from January 1 through December 31 are presented below (in millions): 2015 2014 2013 Balance at beginning of year $ (12,291) $ (11,764) $ (10,963) Deferred income tax provision (593) (756) (363) Acquisition of Insight — — 5 Recorded directly to TWC shareholders’ equity as a component of accumulated other comprehensive income (loss), net: Change in accumulated unrealized losses on pension benefit obligation 24 230 (377) Change in accumulated deferred gains (losses) on cash flow hedges 30 (1) (66) Balance at end of year $ (12,830) $ (12,291) $ (11,764) |
Schedule of Changes in Uncertain Income Tax Positions | Changes in the reserve for uncertain income tax positions, excluding the related accrual for interest and penalties, from January 1 through December 31 are presented below (in millions): 2015 2014 2013 Balance at beginning of year $ 112 $ 108 $ 73 Additions for prior year tax positions 10 16 30 Additions for current year tax positions 18 13 19 Reductions for prior year tax positions (2) (5) — Lapses in statute of limitations (16) (5) (3) Settlements and reversals of timing differences (8) (15) (11) Balance at end of year $ 114 $ 112 $ 108 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Information Table [Abstract] | |
Schedule of Segment Information by Segment | Segment information for the years ended December 31, 2015 , 2014 and 2013 is as follows ( in millions): Year Ended December 31, 2015 Residential Business Other Services Services Operations Shared Intersegment Total Segment Segment Segment Functions Eliminations Consolidated Revenue (a) $ 18,966 $ 3,284 $ 1,710 $ — $ (263) $ 23,697 Operating costs and expenses (10,477) (1,297) (1,045) (3,003) 263 (15,559) Merger-related and restructuring costs — — — (203) — (203) OIBDA $ 8,489 $ 1,987 $ 665 $ (3,206) $ — 7,935 Depreciation (3,560) Amortization (136) Operating Income $ 4,239 Year Ended December 31, 2014 Residential Business Other Services Services Operations Shared Intersegment Total Segment Segment Segment Functions Eliminations Consolidated Revenue (a) $ 18,446 $ 2,838 $ 1,772 $ — $ (244) $ 22,812 Operating costs and expenses (9,823) (1,119) (985) (2,901) 244 (14,584) Merger-related and restructuring costs — — — (225) — (225) OIBDA $ 8,623 $ 1,719 $ 787 $ (3,126) $ — 8,003 Depreciation (3,236) Amortization (135) Operating Income $ 4,632 Year Ended December 31, 2013 Residential Business Other Services Services Operations Shared Intersegment Total Segment Segment Segment Functions Eliminations Consolidated Revenue (a) $ 18,402 $ 2,312 $ 1,602 $ — $ (196) $ 22,120 Operating costs and expenses (9,714) (961) (769) (2,892) 196 (14,140) Merger-related and restructuring costs — — — (119) — (119) OIBDA $ 8,688 $ 1,351 $ 833 $ (3,011) $ — 7,861 Depreciation (3,155) Amortization (126) Operating Income $ 4,580 —————————— Revenue derived from outside the U.S. was insignificant in all periods presented. No single customer accounted for a significant amount of revenue in any period presented. |
Schedule of Segment Revenue by Source | R evenue for the years ended December 31, 2015 , 2014 and 2013 was derived from the following sources (in millions): Year Ended December 31, 2015 2014 2013 Residential Services revenue: Video $ 9,907 $ 10,002 $ 10,481 High-speed data 7,029 6,428 5,822 Voice 1,931 1,932 2,027 Other 99 84 72 Total Residential Services revenue 18,966 18,446 18,402 Business Services revenue: Video 385 365 347 High-speed data 1,609 1,341 1,099 Voice 599 511 421 Wholesale transport 491 415 251 Other 200 206 194 Total Business Services revenue 3,284 2,838 2,312 Other Operations revenue: Advertising 1,028 1,127 1,019 Other 682 645 583 Total Other Operations revenue 1,710 1,772 1,602 Intersegment eliminations (263) (244) (196) Total revenue $ 23,697 $ 22,812 $ 22,120 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments And Contingencies Table [Abstract] | |
Schedule of Contractual Obligations | The following table summarizes the Company's aggregate contractual obligations outstanding as of December 31, 2015 under certain programming and content purchase agreements and various other contractual obligations ( including amounts associated with data processing services, high-speed data connectivity, fiber-rela ted and TWC Media obligations) and the estimated timing and effect that such obligations are expected to have on the Company's liquidity and cash flows in future periods (in millions): 2016 $ 5,975 2017 - 2018 7,947 2019 - 2020 3,445 Thereafter 10,903 Total $ 28,270 |
ADDITIONAL FINANCIAL INFORMAT43
ADDITIONAL FINANCIAL INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Additional Financial Information Table [Abstract] | |
Schedule of Other Current Assets | Other current assets as of December 31, 2015 and 2014 consist ed of the following (in millions): December 31, 2015 2014 (recast) Prepaid income taxes $ 155 $ 157 Other prepaid expenses 201 208 Other current assets 17 18 Total other current assets $ 373 $ 383 |
Schedule of Other Current Liabilities | Other current liabilities as of December 31, 2015 and 2014 consist ed of the following (in millions): December 31, 2015 2014 Accrued interest $ 481 $ 486 Accrued compensation and benefits 443 397 Accrued insurance 225 199 Accrued dividends 216 — Accrued sales and other taxes 150 132 Accrued franchise fees 145 151 Other accrued expenses 419 448 Total other current liabilities $ 2,079 $ 1,813 |
Schedule of Interest Expense, Net | Interest expense, net , for the years ended December 31, 2015 , 2014 and 2013 consist ed of the following (in millions): Year Ended December 31, 2015 2014 2013 Interest expense $ (1,402) $ (1,419) $ (1,555) Interest income 1 — 3 Interest expense, net $ (1,401) $ (1,419) $ (1,552) |
Schedule of Other Income, Net | Other income , net , for the years ended December 31, 2015 , 2014 and 2013 consist ed of the following (in millions): Year Ended December 31, 2015 2014 2013 Income from equity-method investments, net $ 28 $ 33 $ 19 Gain on settlement of Verizon Wireless agency agreement (a) 120 — — Other 2 2 (8) Total other income, net $ 150 $ 35 $ 11 —————————— In 2011, in conjunction with SpectrumCo , LLC's (a joint venture between TWC, Comcast and Bright House Networks) entry into an agreement to sell its advanced wireless spectrum licenses to Cellco Partnership (doing business as Verizon Wireless), TWC and Verizon Wireless entered into agency agreements that allowed TWC to sell Verizon Wireless-branded wireless service, and Verizon Wireless to sell TWC services. Amount represents the settlement of certain terms of the agency agreements in 2015. |
Schedule of Related Party Transactions | T ransactions with related parties ( i.e. , equity-method investees) for the years ended December 31, 2015 , 2014 and 2013 consisted of the following (in millions): Year Ended December 31, 2015 2014 2013 Revenue $ 7 $ 6 $ 7 Costs and expenses: Programming and content $ (191) $ (176) $ (205) Other operating (22) (21) (20) Total costs and expenses $ (213) $ (197) $ (225) |
Schedule of Supplemental Cash Flow Information | Additional financial information with respect to cash (payments) and receipts for the years ended December 31, 2015 , 2014 and 2013 is as follows (in millions): Year Ended December 31, 2015 2014 2013 Cash paid for interest $ (1,482) $ (1,562) $ (1,740) Cash received under interest rate swap contracts 100 127 164 Cash paid for interest, net $ (1,382) $ (1,435) $ (1,576) Cash paid for income taxes $ (468) $ (366) $ (698) Cash refunds of income taxes 15 14 2 Cash paid for income taxes, net $ (453) $ (352) $ (696) |
CONDENSED CONSOLIDATING FINAN44
CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Condensed Consolidating Financial Statements Table [Abstract] | |
Schedule of Condensed Consolidating Balance Sheet | Condensed Consolidating Balance Sheet as of December 31, 2015 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and equivalents $ 901 $ — $ 269 $ — $ 1,170 Receivables, net 23 — 893 — 916 Receivables from affiliated parties 225 — 29 (254) — Other current assets 125 31 217 — 373 Total current assets 1,274 31 1,408 (254) 2,459 Investments in and amounts due from consolidated subsidiaries 46,841 49,326 7,641 (103,808) — Investments — 53 12 — 65 Property, plant and equipment, net — 26 16,919 — 16,945 Intangible assets subject to amortization, net — 18 419 — 437 Intangible assets not subject to amortization — — 26,014 — 26,014 Goodwill — — 3,139 — 3,139 Other assets 269 10 56 (117) 218 Total assets $ 48,384 $ 49,464 $ 55,608 $ (104,179) $ 49,277 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ — $ — $ 656 $ — $ 656 Deferred revenue and subscriber-related liabilities — — 224 — 224 Payables to affiliated parties 29 222 3 (254) — Accrued programming and content expense — — 985 — 985 Current maturities of long-term debt — — 5 — 5 Other current liabilities 725 66 1,288 — 2,079 Total current liabilities 754 288 3,161 (254) 3,949 Long-term debt 20,370 2,056 71 — 22,497 Deferred income tax liabilities, net — 249 12,698 (117) 12,830 Long-term payables to affiliated parties 7,641 14,702 — (22,343) — Other liabilities 460 80 462 — 1,002 TWC shareholders’ equity: Due to (from) TWC and subsidiaries 10,164 2,076 (12,240) — — Other TWC shareholders’ equity 8,995 30,013 51,452 (81,465) 8,995 Total TWC shareholders’ equity 19,159 32,089 39,212 (81,465) 8,995 Noncontrolling interests — — 4 — 4 Total equity 19,159 32,089 39,216 (81,465) 8,999 Total liabilities and equity $ 48,384 $ 49,464 $ 55,608 $ (104,179) $ 49,277 Condensed Consolidating Balance Sheet as of December 31, 2014 (recast) Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and equivalents $ 481 $ — $ 226 $ — $ 707 Receivables, net 31 — 918 — 949 Receivables from affiliated parties 215 — 27 (242) — Other current assets 113 46 224 — 383 Total current assets 840 46 1,395 (242) 2,039 Investments in and amounts due from consolidated subsidiaries 44,790 46,401 7,641 (98,832) — Investments — 51 13 — 64 Property, plant and equipment, net — 28 15,962 — 15,990 Intangible assets subject to amortization, net — 5 518 — 523 Intangible assets not subject to amortization — — 26,012 — 26,012 Goodwill — — 3,137 — 3,137 Other assets 308 12 74 (24) 370 Total assets $ 45,938 $ 46,543 $ 54,752 $ (99,098) $ 48,135 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ — $ — $ 567 $ — $ 567 Deferred revenue and subscriber-related liabilities — — 198 — 198 Payables to affiliated parties 27 212 3 (242) — Accrued programming and content expense — — 902 — 902 Current maturities of long-term debt 1,008 — 9 — 1,017 Other current liabilities 529 63 1,221 — 1,813 Total current liabilities 1,564 275 2,900 (242) 4,497 Long-term debt 20,467 2,061 76 — 22,604 Deferred income tax liabilities, net 26 230 12,059 (24) 12,291 Long-term payables to affiliated parties 7,641 14,702 — (22,343) — Other liabilities 154 91 481 — 726 TWC shareholders’ equity: Due to (from) TWC and subsidiaries 8,073 1,216 (9,289) — — Other TWC shareholders’ equity 8,013 27,968 48,521 (76,489) 8,013 Total TWC shareholders’ equity 16,086 29,184 39,232 (76,489) 8,013 Noncontrolling interests — — 4 — 4 Total equity 16,086 29,184 39,236 (76,489) 8,017 Total liabilities and equity $ 45,938 $ 46,543 $ 54,752 $ (99,098) $ 48,135 |
Schedule of Condensed Consolidating Statement of Operations | Condensed Consolidating Statement of Operations for the Year Ended December 31, 2015 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Revenue $ — $ — $ 23,697 $ — $ 23,697 Costs and expenses: Programming and content — — 5,815 — 5,815 Sales and marketing — — 2,379 — 2,379 Technical operations — — 1,669 — 1,669 Customer care — — 900 — 900 Other operating — — 4,796 — 4,796 Depreciation — — 3,560 — 3,560 Amortization — — 136 — 136 Merger-related and restructuring costs 67 — 136 — 203 Total costs and expenses 67 — 19,391 — 19,458 Operating Income (Loss) (67) — 4,306 — 4,239 Equity in pretax income of consolidated subsidiaries 3,172 4,565 — (7,737) — Interest income (expense), net (238) (1,416) 253 — (1,401) Other income (expense), net 121 (1) 30 — 150 Income before income taxes 2,988 3,148 4,589 (7,737) 2,988 Income tax provision (1,144) (1,193) (1,111) 2,304 (1,144) Net income 1,844 1,955 3,478 (5,433) 1,844 Less: Net income attributable to noncontrolling interests — — — — — Net income attributable to TWC shareholders $ 1,844 $ 1,955 $ 3,478 $ (5,433) $ 1,844 Condensed Consolidating Statement of Operations for the Year Ended December 31, 2014 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Revenue $ — $ — $ 22,812 $ — $ 22,812 Costs and expenses: Programming and content — — 5,294 — 5,294 Sales and marketing — — 2,192 — 2,192 Technical operations — — 1,530 — 1,530 Customer care — — 839 — 839 Other operating — — 4,729 — 4,729 Depreciation — — 3,236 — 3,236 Amortization — — 135 — 135 Merger-related and restructuring costs 66 — 159 — 225 Total costs and expenses 66 — 18,114 — 18,180 Operating Income (Loss) (66) — 4,698 — 4,632 Equity in pretax income of consolidated subsidiaries 3,516 4,842 — (8,358) — Interest income (expense), net (202) (1,426) 209 — (1,419) Other income, net — 6 29 — 35 Income before income taxes 3,248 3,422 4,936 (8,358) 3,248 Income tax provision (1,217) (1,284) (1,287) 2,571 (1,217) Net income 2,031 2,138 3,649 (5,787) 2,031 Less: Net income attributable to noncontrolling interests — — — — — Net income attributable to TWC shareholders $ 2,031 $ 2,138 $ 3,649 $ (5,787) $ 2,031 Condensed Consolidating Statement of Operations for the Year Ended December 31, 2013 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Revenue $ — $ — $ 22,120 $ — $ 22,120 Costs and expenses: Programming and content — — 4,950 — 4,950 Sales and marketing — — 2,048 — 2,048 Technical operations — — 1,500 — 1,500 Customer care — — 766 — 766 Other operating — — 4,876 — 4,876 Depreciation — — 3,155 — 3,155 Amortization — — 126 — 126 Merger-related and restructuring costs — 3 116 — 119 Total costs and expenses — 3 17,537 — 17,540 Operating Income (Loss) — (3) 4,583 — 4,580 Equity in pretax income of consolidated subsidiaries 3,273 3,659 — (6,932) — Interest expense, net (235) (501) (816) — (1,552) Other income (expense), net 1 (5) 15 — 11 Income before income taxes 3,039 3,150 3,782 (6,932) 3,039 Income tax provision (1,085) (1,139) (973) 2,112 (1,085) Net income 1,954 2,011 2,809 (4,820) 1,954 Less: Net income attributable to noncontrolling interests — — — — — Net income attributable to TWC shareholders $ 1,954 $ 2,011 $ 2,809 $ (4,820) $ 1,954 |
Schedule of Condensed Consolidating Statement of Comprehensive Income | Condensed Consolidating Statement of Comprehensive Income for the Year Ended December 31, 2015 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Net income $ 1,844 $ 1,955 $ 3,478 $ (5,433) $ 1,844 Change in accumulated unrealized losses on pension benefit obligation, net of tax (39) — — — (39) Change in accumulated deferred gains (losses) on cash flow hedges, net of tax (50) — — — (50) Other changes (1) — (1) 1 (1) Other comprehensive loss (90) — (1) 1 (90) Comprehensive income 1,754 1,955 3,477 (5,432) 1,754 Less: Comprehensive income attributable to noncontrolling interests — — — — — Comprehensive income attributable to TWC shareholders $ 1,754 $ 1,955 $ 3,477 $ (5,432) $ 1,754 Condensed Consolidating Statement of Comprehensive Income for the Year Ended December 31, 2014 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Net income $ 2,031 $ 2,138 $ 3,649 $ (5,787) $ 2,031 Change in accumulated unrealized losses on pension benefit obligation, net of tax (369) — — — (369) Change in accumulated deferred gains (losses) on cash flow hedges, net of tax 1 — — — 1 Other comprehensive loss (368) — — — (368) Comprehensive income 1,663 2,138 3,649 (5,787) 1,663 Less: Comprehensive income attributable to noncontrolling interests — — — — — Comprehensive income attributable to TWC shareholders $ 1,663 $ 2,138 $ 3,649 $ (5,787) $ 1,663 Condensed Consolidating Statement of Comprehensive Income for the Year Ended December 31, 2013 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Net income $ 1,954 $ 2,011 $ 2,809 $ (4,820) $ 1,954 Change in accumulated unrealized losses on pension benefit obligation, net of tax 604 — — — 604 Change in accumulated deferred gains (losses) on cash flow hedges, net of tax 104 — — — 104 Other changes (1) — (1) 1 (1) Other comprehensive income (loss) 707 — (1) 1 707 Comprehensive income 2,661 2,011 2,808 (4,819) 2,661 Less: Comprehensive income attributable to noncontrolling interests — — — — — Comprehensive income attributable to TWC shareholders $ 2,661 $ 2,011 $ 2,808 $ (4,819) $ 2,661 |
Schedule of Condensed Consolidating Statement of Cash Flows | Condensed Consolidating Statement of Cash Flows for the Year Ended December 31, 2015 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Cash provided (used) by operating activities $ (139) $ (1,499) $ 8,177 $ — $ 6,539 INVESTING ACTIVITIES Capital expenditures — — (4,446) — (4,446) Purchases of investments — (4) — — (4) Proceeds from sale, maturity and collection of investments 1 — 2 — 3 Acquisition of intangible assets — (15) (36) — (51) Investments in (distributions and sale Other investing activities 119 — 34 — 153 Cash provided (used) by investing activities 120 (19) (4,446) — (4,345) FINANCING ACTIVITIES Short-term repayments, net (507) — — — (507) Repayments of long-term debt (500) — — — (500) Repayments of long-term debt assumed in Dividends paid (865) — — — (865) Proceeds from exercise of stock options 129 — — — 129 Excess tax benefit from equity-based compensation 92 — — — 92 Taxes paid in cash in lieu of shares issued for equity-based compensation — — (72) — (72) Net change in investments in and amounts due to and from consolidated subsidiaries 2,091 1,518 (3,609) — — Other financing activities (1) — (7) — (8) Cash provided (used) by financing activities 439 1,518 (3,688) — (1,731) Increase in cash and equivalents 420 — 43 — 463 Cash and equivalents at beginning of year 481 — 226 — 707 Cash and equivalents at end of year $ 901 $ — $ 269 $ — $ 1,170 Condensed Consolidating Statement of Cash Flows for the Year Ended December 31, 2014 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Cash provided (used) by operating activities $ (254) $ (1,345) $ 7,949 $ — $ 6,350 INVESTING ACTIVITIES Capital expenditures — — (4,097) — (4,097) Purchases of investments — (2) — — (2) Proceeds from sale, maturity and collection of investments 18 1 — — 19 Acquisition of intangible assets — (3) (36) — (39) Other investing activities — (2) 29 — 27 Cash provided (used) by investing activities 18 (6) (4,104) — (4,092) FINANCING ACTIVITIES Short-term borrowings, net 507 — — — 507 Repayments of long-term debt (1,750) — — — (1,750) Dividends paid (857) — — — (857) Repurchases of common stock (259) — — — (259) Proceeds from exercise of stock options 226 — — — 226 Excess tax benefit from equity-based compensation 141 — — — 141 Taxes paid in cash in lieu of shares issued for equity-based compensation — — (76) — (76) Net change in investments in and amounts due to and from consolidated subsidiaries 2,394 1,351 (3,745) — — Other financing activities (1) — (7) — (8) Cash provided (used) by financing activities 401 1,351 (3,828) — (2,076) Increase in cash and equivalents 165 — 17 — 182 Cash and equivalents at beginning of year 316 — 209 — 525 Cash and equivalents at end of year $ 481 $ — $ 226 $ — $ 707 Condensed Consolidating Statement of Cash Flows for the Year Ended December 31, 2013 Non- Parent Guarantor Guarantor TWC Company Subsidiary Subsidiaries Eliminations Consolidated Cash provided (used) by operating activities $ (188) $ (595) $ 6,536 $ — $ 5,753 INVESTING ACTIVITIES Capital expenditures — — (3,198) — (3,198) Business acquisitions, net of cash acquired — (429) 6 — (423) Purchases of investments (575) (13) — — (588) Proceeds from sale, maturity and collection of investments 726 — — — 726 Acquisition of intangible assets — (3) (37) — (40) Other investing activities — 9 38 — 47 Cash provided (used) by investing activities 151 (436) (3,191) — (3,476) FINANCING ACTIVITIES Repayments of long-term debt (1,500) — — — (1,500) Repayments of long-term debt assumed in acquisitions — — (138) — (138) Redemption of mandatorily redeemable preferred equity — (300) — — (300) Dividends paid (758) — — — (758) Repurchases of common stock (2,509) — — — (2,509) Proceeds from exercise of stock options 138 — — — 138 Excess tax benefit from equity-based compensation 92 — 1 — 93 Taxes paid in cash in lieu of shares issued for equity-based compensation — — (68) — (68) Net change in investments in and amounts due to and from consolidated subsidiaries 2,725 1,331 (4,056) — — Other financing activities (9) — (5) — (14) Cash provided (used) by financing activities (1,821) 1,031 (4,266) — (5,056) Decrease in cash and equivalents (1,858) — (921) — (2,779) Cash and equivalents at beginning of year 2,174 — 1,130 — 3,304 Cash and equivalents at end of year $ 316 $ — $ 209 $ — $ 525 |
DESCRIPTION OF BUSINESS AND B45
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Details) | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Description Of Business And Basis Of Presentation Details [Abstract] | |
Amount of cash per share to be received upon conversion upon stockholder electing the first of two options | $ / shares | $ 100 |
Number of shares to be received upon conversion upon stockholder electing the first of two options | shares | 0.5409 |
Amount of cash per share to be received upon conversion upon stockholder electing the second of two options | $ / shares | $ 115 |
Number of shares to be received upon conversion upon stockholder electing the second of two options | shares | 0.4562 |
RECENT ACCOUNTING STANDARDS (De
RECENT ACCOUNTING STANDARDS (Details) $ in Millions | Dec. 31, 2014USD ($) |
Recent Accounting Standards Details [Abstract] | |
Current deferred income tax assets reclassified upon adoption of ASU 2015-17 | $ 269 |
Current portion of capitalized debt issuance costs, net of accumulated amortization, reclassified upon adoption of ASU 2015-03 | 8 |
Noncurrent portion of capitalized debt issuance costs, net of accumulated amortization, reclassified upon adoption of ASU 2015-03 | $ 89 |
SUMMARY OF SIGNIFICANT ACCOUN47
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Summary Of Significant Accounting Policies Details [Abstract] | |||
Maturity threshold for classification as cash and equivalents | 3 months | ||
Allowance for doubtful accounts, balance at beginning of year | $ 109 | $ 77 | $ 65 |
Provision for bad debts | 212 | 275 | 249 |
Write-offs, net of recoveries | (227) | (243) | (237) |
Allowance for doubtful accounts, balance at end of year | $ 94 | 109 | 77 |
Property, Plant and Equipment | |||
Useful life threshold for capitalization of tangible fixed assets | 1 year | ||
Property, plant and equipment, gross | $ 41,776 | 38,552 | |
Accumulated depreciation | (24,831) | (22,562) | |
Property, plant and equipment, net | 16,945 | 15,990 | |
Depreciation | $ 3,560 | 3,236 | 3,155 |
Number of reportable segments | 3 | ||
Taxes collected from customers and remitted to governmental authorities | $ 684 | 666 | 685 |
Advertising costs | 720 | 684 | 676 |
Land, Buildings and Improvements [Member] | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | $ 2,093 | 2,038 | |
Land, Buildings and Improvements [Member] | Minimum [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 1 year | ||
Land, Buildings and Improvements [Member] | Maximum [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 20 years | ||
Land [Member] | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | $ 174 | 173 | |
Buildings and Improvements [Member] | Weighted Average [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 17 years 8 months 26 days | ||
Distribution Systems [Member] | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | $ 27,126 | 24,951 | |
Distribution Systems [Member] | Minimum [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 3 years | ||
Distribution Systems [Member] | Maximum [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 25 years | ||
Distribution Systems [Member] | Weighted Average [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 13 years 2 months 20 days | ||
Converters And Modems [Member] | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | $ 6,743 | 6,141 | |
Converters And Modems [Member] | Minimum [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 3 years | ||
Converters And Modems [Member] | Maximum [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 5 years | ||
Capitalized Software Costs [Member] | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | $ 2,924 | 2,572 | |
Property, plant and equipment, net | 807 | 803 | |
Depreciation | $ 361 | 317 | $ 270 |
Capitalized Software Costs [Member] | Minimum [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 3 years | ||
Capitalized Software Costs [Member] | Maximum [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 5 years | ||
Vehicles and Other Equipment [Member] | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | $ 2,466 | 2,374 | |
Vehicles and Other Equipment [Member] | Minimum [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 3 years | ||
Vehicles and Other Equipment [Member] | Maximum [Member] | |||
Property, Plant and Equipment | |||
Estimated useful life | 10 years | ||
Construction In Progress [Member] | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | $ 424 | $ 476 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Earnings Per Share Details [Abstract] | |||
Net income attributable to TWC common shareholders | $ 1,825 | $ 2,013 | $ 1,944 |
Net income attributable to participating securities | 19 | 18 | 10 |
Net income attributable to TWC shareholders | $ 1,844 | $ 2,031 | $ 1,954 |
Weighted-average common shares outstanding - basic (in shares) | 282.6 | 279.3 | 287.6 |
Dilutive effect of nonparticipating equity awards (in shares) | 0.9 | 1.6 | 1.9 |
Dilutive effect of participating equity awards (in shares) | 2.4 | 2.1 | 2.2 |
Weighted-average common shares outstanding - diluted (in shares) | 285.9 | 283 | 291.7 |
Net income per common share attributable to TWC common shareholders - basic (in US dollars per share) | $ 6.46 | $ 7.21 | $ 6.76 |
Net income per common share attributable to TWC common shareholders - diluted (in US dollars per share) | $ 6.44 | $ 7.17 | $ 6.70 |
BUSINESS ACQUISITION (Details)
BUSINESS ACQUISITION (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2013USD ($) | |
Business Acquisition Details [Abstract] | |
Payments to acquire DukeNet, net of cash acquired, and to repay debt | $ 572 |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Investments | |||
Equity-method investments | $ 62 | $ 60 | |
Other investments | 3 | 4 | |
Total investments | 65 | 64 | |
Income from equity-method investments, net | $ 28 | 33 | $ 19 |
MLB Network [Member] | |||
Investments | |||
Equity-method investments, ownership percentage | 5.30% | ||
iN Demand [Member] | |||
Investments | |||
Equity-method investments, ownership percentage | 28.60% | ||
National Cable Communications [Member] | |||
Investments | |||
Equity-method investments, ownership percentage | 16.70% | ||
SportsNet New York [Member] | |||
Investments | |||
Equity-method investments | $ (179) | $ (179) | |
Equity-method investments, ownership percentage | 26.80% |
INTANGIBLE ASSETS AND GOODWIL51
INTANGIBLE ASSETS AND GOODWILL (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Intangible Assets Subject to Amortization | |||
Intangible assets subject to amortization, gross | $ 960 | $ 939 | |
Intangible assets subject to amortization, accumulated amortization | (523) | (416) | |
Intangible assets subject to amortization, net | 437 | 523 | |
Amortization expense | 136 | 135 | $ 126 |
Estimated future amortization one year from balance sheet date | 133 | ||
Estimated future amortization more than one and within two years from balance sheet date | 129 | ||
Estimated future amortization more than two and within three years from balance sheet date | 51 | ||
Estimated future amortization more than three and within four years from balance sheet date | 32 | ||
Estimated future amortization more than four and within five years from balance sheet date | 26 | ||
Cable franchise rights, gross | 26,936 | 26,934 | |
Cable franchise rights, accumulated amortization | (922) | (922) | |
Cable franchise rights, net | 26,014 | 26,012 | |
Goodwill | |||
Goodwill at beginning of period | 3,137 | 3,196 | |
Goodwill, purchasing accounting adjustments (DukeNet) | 0 | (61) | |
Goodwill, other changes | 2 | 2 | |
Goodwill at end of period | 3,139 | 3,137 | $ 3,196 |
Goodwill, accumulated impairment loss | 0 | 0 | |
Residential Services Segment [Member] | |||
Goodwill | |||
Goodwill at beginning of period | 2,259 | ||
Goodwill at end of period | 2,260 | 2,259 | |
Business Services Segment [Member] | |||
Goodwill | |||
Goodwill at beginning of period | 784 | ||
Goodwill at end of period | 785 | 784 | |
Other Operations Segment [Member] | |||
Goodwill | |||
Goodwill at beginning of period | 94 | ||
Goodwill at end of period | 94 | 94 | |
Customer Relationships [Member] | |||
Intangible Assets Subject to Amortization | |||
Intangible assets subject to amortization, gross | 597 | 600 | |
Intangible assets subject to amortization, accumulated amortization | (353) | (262) | |
Intangible assets subject to amortization, net | 244 | 338 | |
Cable Franchise Renewals and Access Rights [Member] | |||
Intangible Assets Subject to Amortization | |||
Intangible assets subject to amortization, gross | 306 | 297 | |
Intangible assets subject to amortization, accumulated amortization | (138) | (130) | |
Intangible assets subject to amortization, net | 168 | 167 | |
Other Intangible Assets Subject to Amortization [Member] | |||
Intangible Assets Subject to Amortization | |||
Intangible assets subject to amortization, gross | 57 | 42 | |
Intangible assets subject to amortization, accumulated amortization | (32) | (24) | |
Intangible assets subject to amortization, net | $ 25 | $ 18 |
DEBT (Details)
DEBT (Details) £ in Millions, $ in Millions | 12 Months Ended | |||||
Dec. 31, 2015USD ($) | Dec. 31, 2015GBP (£) | Dec. 31, 2014USD ($) | Dec. 31, 2014GBP (£) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) | |
Debt | ||||||
Total debt, amount outstanding | $ 22,502 | $ 23,621 | ||||
Current maturities of long-term debt, amount outstanding | (5) | (1,017) | ||||
Total long-term debt, amount outstanding | 22,497 | 22,604 | ||||
Unused committed financial capacity | 4,607 | |||||
Cash and equivalents | 1,170 | 707 | $ 525 | $ 3,304 | ||
Available borrowing capacity | 3,437 | |||||
Outstanding letters of credit | 63 | |||||
Repayments of principal one year from balance sheet date | 5 | |||||
Repayments of principal more than one and within two years from balance sheet date | 2,004 | |||||
Repayments of principal more than two and within three years from balance sheet date | 2,003 | |||||
Repayments of principal more than three and within four years from balance sheet date | 3,253 | |||||
Repayments of principal more than four and within five years from balance sheet date | 1,504 | |||||
Repayments of principal more than five years from balance sheet date | 13,995 | |||||
Senior Notes And Debentures [Member] | ||||||
Debt | ||||||
Total debt, amount outstanding | $ 22,426 | 23,029 | ||||
Effective interest rate | 6.218% | 6.218% | ||||
Senior Notes And Debentures [Member] | TWC [Member] | ||||||
Debt | ||||||
Total debt, amount outstanding | $ 20,370 | 20,968 | ||||
Estimated fair value of interest rate swap assets | 62 | 74 | ||||
Unamortized debt issuance costs | 89 | 97 | ||||
Unamortized discount | 132 | 145 | ||||
Senior Notes And Debentures [Member] | TWCE [Member] | ||||||
Debt | ||||||
Total debt, amount outstanding | 2,056 | 2,061 | ||||
Unamortized fair value adjustment | $ 56 | 61 | ||||
Senior Notes And Debentures [Member] | Notes Maturing Feb 2015 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 3.50% | 3.50% | ||||
Principal amount | $ 500 | |||||
Total debt, amount outstanding | $ 0 | 501 | ||||
Senior Notes And Debentures [Member] | Notes Maturing May 2017 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 5.85% | 5.85% | ||||
Principal amount | $ 2,000 | |||||
Total debt, amount outstanding | $ 2,045 | 2,075 | ||||
Senior Notes And Debentures [Member] | Notes Maturing July 2018 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 6.75% | 6.75% | ||||
Principal amount | $ 2,000 | |||||
Total debt, amount outstanding | $ 2,002 | 1,989 | ||||
Senior Notes And Debentures [Member] | Notes Maturing Feb 2019 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 8.75% | 8.75% | ||||
Principal amount | $ 1,250 | |||||
Total debt, amount outstanding | $ 1,242 | 1,240 | ||||
Senior Notes And Debentures [Member] | Notes Maturing Apr 2019 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 8.25% | 8.25% | ||||
Principal amount | $ 2,000 | |||||
Total debt, amount outstanding | $ 2,004 | 1,992 | ||||
Senior Notes And Debentures [Member] | Notes Maturing Feb 2020 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 5.00% | 5.00% | ||||
Principal amount | $ 1,500 | |||||
Total debt, amount outstanding | $ 1,485 | 1,481 | ||||
Senior Notes And Debentures [Member] | Notes Maturing Feb 2021 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 4.125% | 4.125% | ||||
Principal amount | $ 700 | |||||
Total debt, amount outstanding | $ 696 | 695 | ||||
Senior Notes And Debentures [Member] | Notes Maturing Sep 2021 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 4.00% | 4.00% | ||||
Principal amount | $ 1,000 | |||||
Total debt, amount outstanding | $ 992 | 991 | ||||
Senior Notes And Debentures [Member] | Notes Maturing June 2031 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 5.75% | 5.75% | ||||
Principal amount | $ 921 | |||||
Total debt, amount outstanding | $ 913 | £ 619 | 964 | £ 619 | ||
Senior Notes And Debentures [Member] | Debentures Maturing May 2037 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 6.55% | 6.55% | ||||
Principal amount | $ 1,500 | |||||
Total debt, amount outstanding | $ 1,483 | 1,482 | ||||
Senior Notes And Debentures [Member] | Debentures Maturing July 2038 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 7.30% | 7.30% | ||||
Principal amount | $ 1,500 | |||||
Total debt, amount outstanding | $ 1,486 | 1,486 | ||||
Senior Notes And Debentures [Member] | Debentures Maturing June 2039 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 6.75% | 6.75% | ||||
Principal amount | $ 1,500 | |||||
Total debt, amount outstanding | $ 1,455 | 1,453 | ||||
Senior Notes And Debentures [Member] | Debentures Maturing Nov 2040 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 5.875% | 5.875% | ||||
Principal amount | $ 1,200 | |||||
Total debt, amount outstanding | $ 1,171 | 1,170 | ||||
Senior Notes And Debentures [Member] | Debentures Maturing Sep 2041 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 5.50% | 5.50% | ||||
Principal amount | $ 1,250 | |||||
Total debt, amount outstanding | $ 1,221 | 1,220 | ||||
Senior Notes And Debentures [Member] | Notes Maturing July 2042 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 5.25% | 5.25% | ||||
Principal amount | $ 958 | |||||
Total debt, amount outstanding | $ 942 | £ 639 | 996 | £ 640 | ||
Senior Notes And Debentures [Member] | Debentures Maturing Sep 2042 [Member] | TWC [Member] | ||||||
Debt | ||||||
Stated interest rate | 4.50% | 4.50% | ||||
Principal amount | $ 1,250 | |||||
Total debt, amount outstanding | $ 1,233 | 1,233 | ||||
Senior Notes And Debentures [Member] | Debentures Maturing Mar 2023 [Member] | TWCE [Member] | ||||||
Debt | ||||||
Stated interest rate | 8.375% | 8.375% | ||||
Principal amount | $ 1,000 | |||||
Total debt, amount outstanding | $ 1,019 | 1,022 | ||||
Senior Notes And Debentures [Member] | Debentures Maturing July 2033 [Member] | TWCE [Member] | ||||||
Debt | ||||||
Stated interest rate | 8.375% | 8.375% | ||||
Principal amount | $ 1,000 | |||||
Total debt, amount outstanding | 1,037 | 1,039 | ||||
Revolving Credit Facility [Member] | ||||||
Debt | ||||||
Total debt, amount outstanding | 0 | 0 | ||||
Revolving credit facility, maximum borrowing capacity | $ 3,500 | |||||
Revolving credit facility, years to maturity from date of origination | 5 years | |||||
Revolving credit facility, basis spread on LIBOR variable rate | 1.10% | |||||
Revolving credit facility, facility fee | 0.15% | |||||
Revolving credit facility, maximum letters of credit issuances | $ 500 | |||||
Revolving credit facility, maximum leverage ratio (in times) | 5 | 5 | ||||
Revolving credit facility, actual leverage ratio (in times) | 2.6 | 2.6 | ||||
Commercial Paper Program [Member] | ||||||
Debt | ||||||
Total debt, amount outstanding | $ 0 | 507 | ||||
Commercial paper program, maximum borrowing capacity | 2,500 | |||||
Capital Leases [Member] | ||||||
Debt | ||||||
Total debt, amount outstanding | $ 76 | $ 85 |
MANDATORILY REDEEMABLE PREFER53
MANDATORILY REDEEMABLE PREFERRED EQUITY (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Mandatorily Redeemable Preferred Equity Details [Abstract] | ||||
Mandatorily redeemable preferred equity issued | $ 300 | |||
Redemption of mandatorily redeemable preferred equity | $ 0 | $ 0 | $ (300) | |
Mandatorily redeemable preferred equity dividend rate | 8.21% |
DERIVATIVE FINANCIAL INSTRUME54
DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Details) £ in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2015GBP (£) | |
Derivative Financial Instruments | ||||
Derivative assets subject to master netting arrangements recorded gross | $ 159 | $ 290 | ||
Derivative liabilities subject to master netting arrangements recorded gross | 87 | 19 | ||
Deferred gains (losses) recognized in other comprehensive income (loss) (effective portion) | (187) | (124) | $ 209 | |
Deferred gains (losses) reclassified from accumulated other comprehensive loss, net, into other income, net (effective portion) | (107) | (126) | $ 39 | |
Carrying value of senior notes and debentures | 22,426 | 23,029 | ||
Estimated fair value of senior notes and debentures | 23,637 | 27,842 | ||
Interest Rate Swaps [Member] | ||||
Derivative Financial Instruments | ||||
Derivative assets subject to master netting arrangements recorded gross | 69 | 93 | ||
Derivative liabilities subject to master netting arrangements recorded gross | 7 | 19 | ||
Notional amount of derivative financial instrument | $ 5,600 | $ 6,100 | ||
Interest rate swaps, average pay rate | 5.41% | 4.78% | 5.41% | |
Interest rate swaps, average receive rate | 6.86% | 6.58% | 6.86% | |
Interest Rate Swaps [Member] | Other Current Assets [Member] | ||||
Derivative Financial Instruments | ||||
Derivative assets subject to master netting arrangements recorded gross | $ 1 | |||
Cross-Currency Swaps [Member] | ||||
Derivative Financial Instruments | ||||
Derivative assets subject to master netting arrangements recorded gross | $ 90 | 197 | ||
Derivative liabilities subject to master netting arrangements recorded gross | $ 80 | $ 0 | ||
Notional amount of derivative financial instrument | £ | £ 1,275 |
TWC SHAREHOLDERS' EQUITY (Detai
TWC SHAREHOLDERS' EQUITY (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Time Warner Cable Shareholders Equity Disclosure [Abstract] | |||||||||||||||
Common stock shares authorized (in shares) | 8,333 | 8,333 | |||||||||||||
Common stock par value per share (in US dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||||
Common stock shares issued (in shares) | 283.3 | 280.8 | 283.3 | 280.8 | |||||||||||
Common stock shares outstanding at beginning of year (in shares) | 280.8 | 277.9 | 297.7 | 280.8 | 277.9 | 297.7 | |||||||||
Shares issued under the equity-based compensation plan (in shares) | 2.5 | 4.4 | 4.2 | ||||||||||||
Shares repurchased and retired (in shares) | 0 | 1.5 | 24 | ||||||||||||
Common stock shares outstanding at end of year (in shares) | 283.3 | 280.8 | 277.9 | 283.3 | 280.8 | 277.9 | |||||||||
Preferred stock shares authorized (in shares) | 1,000 | 1,000 | |||||||||||||
Preferred stock par value per share (in US dollars per share) | $ 0.01 | $ 0.01 | |||||||||||||
Preferred stock shares issued (in shares) | 0 | 0 | 0 | 0 | |||||||||||
Preferred stock shares outstanding (in shares) | 0 | 0 | 0 | 0 | |||||||||||
Value of common stock authorized to be repurchased | $ 4,000 | $ 4,000 | |||||||||||||
Remaining value of common stock authorized to be repurchased | $ 2,723 | $ 2,723 | |||||||||||||
Cash dividends declared per common share (in US dollars per share) | $ 0.75 | $ 0.75 | $ 0.75 | $ 1.50 | $ 0.75 | $ 0.75 | $ 0.75 | $ 0.75 | $ 0.65 | $ 0.65 | $ 0.65 | $ 0.65 | $ 3.75 | $ 3 | $ 2.60 |
Cash dividends declared | $ 216 | $ 218 | $ 216 | $ 431 | $ 215 | $ 214 | $ 215 | $ 213 | $ 185 | $ 188 | $ 190 | $ 195 | $ 1,081 | $ 857 | $ 758 |
Accumulated Other Comprehensive Income (Loss), Net | |||||||||||||||
Balance at beginning of year | (324) | 44 | (663) | (324) | 44 | (663) | |||||||||
Other comprehensive income (loss) before reclassifications, net of tax | (182) | (445) | 686 | ||||||||||||
Amounts reclassified into earnings, net of tax | 92 | 77 | 21 | ||||||||||||
Other comprehensive income (loss) | (90) | (368) | 707 | ||||||||||||
Balance at end of year | (414) | (324) | 44 | (414) | (324) | 44 | |||||||||
Unrealized Losses on Pension Benefit Obligation [Member] | |||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net | |||||||||||||||
Balance at beginning of year | (473) | (104) | (708) | (473) | (104) | (708) | |||||||||
Other comprehensive income (loss) before reclassifications, net of tax | (65) | (368) | 558 | ||||||||||||
Amounts reclassified into earnings, before tax | 41 | (2) | 75 | ||||||||||||
Income tax provision (benefit) | (15) | 1 | (29) | ||||||||||||
Amounts reclassified into earnings, net of tax | 26 | (1) | 46 | ||||||||||||
Other comprehensive income (loss) | (39) | (369) | 604 | ||||||||||||
Balance at end of year | (512) | (473) | (104) | (512) | (473) | (104) | |||||||||
Deferred Gains (Losses) on Cash Flow Hedges [Member] | |||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net | |||||||||||||||
Balance at beginning of year | 150 | 149 | 45 | 150 | 149 | 45 | |||||||||
Other comprehensive income (loss) before reclassifications, net of tax | (116) | (77) | 129 | ||||||||||||
Amounts reclassified into earnings, before tax | 107 | 126 | (39) | ||||||||||||
Income tax provision (benefit) | (41) | (48) | 14 | ||||||||||||
Amounts reclassified into earnings, net of tax | 66 | 78 | (25) | ||||||||||||
Other comprehensive income (loss) | (50) | 1 | 104 | ||||||||||||
Balance at end of year | 100 | 150 | 149 | 100 | 150 | 149 | |||||||||
Other Changes [Member] | |||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net | |||||||||||||||
Balance at beginning of year | $ (1) | $ (1) | $ 0 | (1) | (1) | 0 | |||||||||
Other comprehensive income (loss) before reclassifications, net of tax | (1) | 0 | (1) | ||||||||||||
Amounts reclassified into earnings, net of tax | 0 | 0 | 0 | ||||||||||||
Other comprehensive income (loss) | (1) | 0 | (1) | ||||||||||||
Balance at end of year | $ (2) | $ (1) | $ (1) | $ (2) | $ (1) | $ (1) |
EQUITY-BASED COMPENSATION (Deta
EQUITY-BASED COMPENSATION (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Equity Based Compensation Details [Abstract] | |||
Number of shares authorized for grant (in shares) | 20,000 | ||
Number of shares available for grant (in shares) | 8,300 | ||
Equity-Based Compensation | |||
Equity-based compensation expense | $ 161 | $ 182 | $ 128 |
Tax benefit recognized related to equity-based compensation expense | 63 | 71 | $ 49 |
Equity-based compensation expense classified as merger-related costs | $ 47 | $ 56 | |
Number of unvested restricted stock units at beginning of period (in shares) | 6,264 | ||
Number of unvested restricted stock units granted (in shares) | 986 | 3,807 | 1,200 |
Number of unvested restricted stock units vested (in shares) | 1,120 | ||
Number of unvested restricted stock units forfeited (in shares) | 436 | ||
Number of unvested restricted stock units at end of period (in shares) | 5,694 | 6,264 | |
Weighted-average grant date fair value, restricted stock units unvested at beginning of period (in US dollars per share) | $ 112.06 | ||
Weighted-average grant date fair value, restricted stock units granted (in US dollars per share) | 179.02 | $ 135.81 | $ 87.30 |
Weighted-average grant date fair value, restricted stock units vested (in US dollars per share) | 80.85 | ||
Weighted-average grant date fair value, restricted stock units forfeited (in US dollars per share) | 129.20 | ||
Weighted-average grant date fair value, restricted stock units unvested at end of period (in US dollars per share) | $ 128.47 | $ 112.06 | |
Fair value of restricted stock units that vested during the year | $ 91 | $ 87 | $ 98 |
Aggregate intrinsic value, unvested restricted stock units | $ 1,057 | ||
Number of options outstanding at beginning of period (in shares) | 4,219 | ||
Number of options granted (in shares) | 0 | 0 | 2,539 |
Number of options exercised (in shares) | 1,905 | ||
Number of options forfeited or expired (in shares) | 124 | ||
Number of options outstanding at end of period (in shares) | 2,190 | 4,219 | |
Number of options exercisable at end of period (in shares) | 881 | ||
Number of options expected to vest at end of period (in shares) | 1,291 | ||
Weighted-average exercise price, options outstanding at beginning of period (in US dollars per share) | $ 75.29 | ||
Weighted-average exercise price, options exercised (in US dollars per share) | 73.88 | ||
Weighted-average exercise price, options forfeited or expired (in US dollars per share) | 87.56 | ||
Weighted-average exercise price, options outstanding at end of period (in US dollars per share) | 75.83 | $ 75.29 | |
Weighted-average exercise price, options exercisable at end of period (in US dollars per share) | 63.93 | ||
Weighted-average exercise price, options expected to vest at end of period (in US dollars per share) | $ 83.79 | ||
Weighted-average remaining contractual term, options outstanding | 5 years 10 months 10 days | ||
Weighted-average remaining contractual term, options exercisable | 4 years 5 months 22 days | ||
Weighted-average remaining contractual term, options expected to vest | 6 years 9 months 11 days | ||
Aggregate intrinsic value, options outstanding | $ 240 | ||
Aggregate intrinsic value, options exercisable | 107 | ||
Aggregate intrinsic value, options expected to vest | 131 | ||
Weighted-average grant date fair value, options granted (in US dollars per share) | $ 15.66 | ||
Total intrinsic value, options exercised | 165 | $ 285 | $ 167 |
Proceeds from exercise of stock options | 129 | 226 | 138 |
Tax benefits realized, options exercised | 64 | 114 | $ 67 |
Expected volatility | 26.14% | ||
Expected term to exercise from grant date | 5 years 11 months 13 days | ||
Risk-free rate | 1.19% | ||
Expected dividend yield | 2.97% | ||
Restricted Stock Units [Member] | |||
Equity-Based Compensation | |||
Equity-based compensation expense | 147 | 160 | $ 89 |
Total unrecognized compensation cost | $ 440 | ||
Total unrecognized compensation cost, period for recognition | 3 years 7 months 2 days | ||
Award vesting percentage | 50.00% | ||
Award vesting period, directors | 3 years | ||
Restricted Stock Units [Member] | Minimum [Member] | |||
Equity-Based Compensation | |||
Award vesting period | 3 years | ||
Restricted Stock Units [Member] | Maximum [Member] | |||
Equity-Based Compensation | |||
Award vesting period | 4 years | ||
Stock Options [Member] | |||
Equity-Based Compensation | |||
Equity-based compensation expense | $ 14 | $ 22 | $ 39 |
Total unrecognized compensation cost | $ 7 | ||
Total unrecognized compensation cost, period for recognition | 1 year 29 days | ||
Award vesting period | 4 years | ||
Award expiration period | 10 years | ||
Performance Based Award [Member] | |||
Equity-Based Compensation | |||
Number of unvested restricted stock units granted (in shares) | 143 | 142 | |
Weighted-average grant date fair value, restricted stock units granted (in US dollars per share) | $ 135.31 | $ 87.31 | |
Number of options granted (in shares) | 302 | ||
Weighted-average grant date fair value, options granted (in US dollars per share) | $ 15.57 |
EMPLOYEE BENEFIT PLANS (Details
EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Pension Plans | ||||||
Projected benefit obligation at beginning of year | $ 3,206 | $ 2,550 | ||||
Service cost | 230 | 173 | $ 204 | |||
Interest cost | 147 | 144 | 139 | |||
Actuarial (gain) loss | (241) | 606 | ||||
Plan amendment | 0 | 3 | ||||
Benefits paid | (151) | (270) | ||||
Projected benefit obligation at end of year | 3,191 | 3,206 | 2,550 | |||
Accumulated benefit obligation at end of year | 2,715 | 2,709 | ||||
Fair value of plan assets at beginning of year | 3,106 | 3,124 | ||||
Actual return on plan assets | (116) | 247 | ||||
Employer contributions | 5 | 5 | ||||
Benefits paid | (151) | (270) | ||||
Fair value of plan assets at end of year | 2,844 | 3,106 | 3,124 | |||
Funded status | $ (347) | $ (100) | ||||
Amounts recognized in the consolidated balance sheet, current liability | (5) | (5) | ||||
Amounts recognized in the consolidated balance sheet, noncurrent liability | (342) | (95) | ||||
Amounts recognized in the consolidated balance sheet, total liabilities | (347) | (100) | ||||
Amounts recognized in the consolidated balance sheet, net actuarial loss included in accumulated other comprehensive income (loss), net | (862) | (802) | ||||
Amounts recognized in the consolidated balance sheet, prior service credit included in accumulated other comprehensive income (loss), net | 27 | 30 | ||||
Amounts recognized in the consolidated balance sheet, total TWC shareholders' equity | $ (835) | $ (772) | ||||
Service cost | 230 | 173 | 204 | |||
Interest cost | 147 | 144 | 139 | |||
Expected return on plan assets | (229) | (233) | (214) | |||
Amounts amortized | 41 | (3) | 75 | |||
Settlement loss | 0 | 0 | 1 | |||
Net periodic benefit costs | 189 | $ 81 | $ 205 | |||
Amounts that will be amortized from accumulated other comprehensive income (loss), net, into net periodic benefit cost in the next fiscal year | $ 45 | |||||
Weighted-average assumptions used in calculating benefit obligation, discount rate | 4.74% | 4.32% | 5.27% | |||
Weighted-average assumptions used in calculating benefit obligation, rate of compensation increase | 4.25% | 4.25% | 4.75% | |||
Weighted-average assumptions used in calculating net period benefit cost, expected long-term rate of return on plan assets | 7.50% | 7.50% | 7.50% | |||
Weighted-average assumptions used in calculating net period benefit cost, discount rate | 4.32% | 5.27% | 4.31% | |||
Weighted-average assumptions used in calculating net period benefit cost, rate of compensation increase | 4.25% | 4.75% | 4.75% | |||
Weighted-average assumptions used in calculating net period benefit cost in next fiscal year, expected long-term rate of return on plan assets | 7.50% | |||||
Pension investment assets, fair value | $ 2,842 | $ 3,100 | ||||
Pension investment assets, accrued investment income and other receivables | 65 | 79 | ||||
Pension investment assets, accrued liabilities | (63) | (73) | ||||
Plan assets, fair value | $ 2,844 | $ 3,124 | $ 3,124 | 2,844 | 3,106 | $ 3,124 |
Expected future pension benefit payments one year from balance sheet date | 126 | |||||
Expected future pension benefit payments more than one and within two years from balance sheet date | 142 | |||||
Expected future pension benefit payments more than two and within three years from balance sheet date | 158 | |||||
Expected future pension benefit payments more than three and within four years from balance sheet date | 174 | |||||
Expected future pension benefit payments more than four and within five years from balance sheet date | 189 | |||||
Expected future pension benefit payments more than five years from balance sheet date | 1,176 | |||||
Employer contributions to multiemployer plans | 46 | 45 | 44 | |||
Matching employer contributions to defined contribution plan | 97 | 91 | 82 | |||
Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 1,679 | 1,859 | ||||
Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 1,156 | 1,231 | ||||
Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | $ 7 | $ 10 | ||||
Pension investment assets at beginning of year | 10 | 10 | ||||
Purchases | 2 | 2 | ||||
Sales | (7) | (2) | ||||
Sales, net | (5) | 0 | ||||
Actual return on plan assets held at end of year | 2 | 0 | ||||
Pension investment assets at end of year | $ 7 | 10 | $ 10 | |||
Return Seeking Securities [Member] | ||||||
Pension Plans | ||||||
Pension assets, target investment allocation | 70.00% | |||||
Pension assets, actual investment allocation | 66.00% | 68.20% | ||||
Liability Matching Securities [Member] | ||||||
Pension Plans | ||||||
Pension assets, target investment allocation | 30.00% | |||||
Pension assets, actual investment allocation | 33.70% | 31.40% | ||||
Cash [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | $ 1 | |||||
Cash [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 1 | |||||
Cash [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | |||||
Cash [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | |||||
Domestic Common Stocks [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 1,051 | $ 1,176 | ||||
Domestic Common Stocks [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 1,051 | 1,176 | ||||
Domestic Common Stocks [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Domestic Common Stocks [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
International Common Stocks [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 368 | 412 | ||||
International Common Stocks [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 368 | 412 | ||||
International Common Stocks [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
International Common Stocks [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Commingled Equity Funds [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 337 | 348 | ||||
Commingled Equity Funds [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Commingled Equity Funds [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 337 | 348 | ||||
Commingled Equity Funds [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Mutual Funds [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 70 | |||||
Mutual Funds [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 70 | |||||
Mutual Funds [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | |||||
Mutual Funds [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | |||||
Other Equity Securities [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 4 | 3 | ||||
Other Equity Securities [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 4 | 3 | ||||
Other Equity Securities [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Other Equity Securities [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Corporate Debt Securities [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 325 | 361 | ||||
Corporate Debt Securities [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Corporate Debt Securities [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 325 | 361 | ||||
Corporate Debt Securities [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Commingled Bond Funds [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 259 | 268 | ||||
Commingled Bond Funds [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Commingled Bond Funds [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 259 | 268 | ||||
Commingled Bond Funds [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
U.S. Treasury Debt Securities [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 255 | 194 | ||||
U.S. Treasury Debt Securities [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 255 | 194 | ||||
U.S. Treasury Debt Securities [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
U.S. Treasury Debt Securities [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Collective Trust Funds [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 89 | 80 | ||||
Collective Trust Funds [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Collective Trust Funds [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 89 | 80 | ||||
Collective Trust Funds [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
U.S. Government Agency Asset-Backed Debt Securities [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 34 | 34 | ||||
U.S. Government Agency Asset-Backed Debt Securities [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
U.S. Government Agency Asset-Backed Debt Securities [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 34 | 34 | ||||
U.S. Government Agency Asset-Backed Debt Securities [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Corporate Asset-Backed Debt Securities [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 8 | 10 | ||||
Corporate Asset-Backed Debt Securities [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Corporate Asset-Backed Debt Securities [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 8 | 10 | ||||
Corporate Asset-Backed Debt Securities [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Other Fixed-Income Securities [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 104 | 130 | ||||
Other Fixed-Income Securities [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Other Fixed-Income Securities [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 104 | 130 | ||||
Other Fixed-Income Securities [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | $ 0 | $ 0 | ||||
Other Investments [Member] | ||||||
Pension Plans | ||||||
Pension assets, target investment allocation | 0.00% | |||||
Pension assets, actual investment allocation | 0.30% | 0.40% | ||||
Pension investment assets, fair value | $ 7 | $ 14 | ||||
Other Investments [Member] | Level 1 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 4 | ||||
Other Investments [Member] | Level 2 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 0 | 0 | ||||
Other Investments [Member] | Level 3 [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, fair value | 7 | 10 | ||||
Foreign Exchange Contract [Member] | ||||||
Pension Plans | ||||||
Pension investment assets, accrued investment income and other receivables | 54 | 67 | ||||
Pension investment assets, accrued liabilities | (54) | (67) | ||||
Plan Amendment [Member] | ||||||
Pension Plans | ||||||
Benefits paid | (210) | |||||
Benefits paid | (210) | |||||
Qualified Pension Plans [Member] | ||||||
Pension Plans | ||||||
Projected benefit obligation at beginning of year | $ 3,166 | |||||
Projected benefit obligation at end of year | 3,153 | 3,166 | ||||
Accumulated benefit obligation at end of year | 2,677 | 2,670 | ||||
Fair value of plan assets at beginning of year | 3,106 | |||||
Fair value of plan assets at end of year | 2,844 | 3,106 | ||||
Plan assets, fair value | 2,844 | 3,106 | 2,844 | 3,106 | ||
Nonqualified Pension Plan [Member] | ||||||
Pension Plans | ||||||
Projected benefit obligation at beginning of year | 40 | |||||
Projected benefit obligation at end of year | 38 | 40 | ||||
Accumulated benefit obligation at end of year | 38 | 39 | ||||
Fair value of plan assets at beginning of year | 0 | |||||
Fair value of plan assets at end of year | 0 | 0 | ||||
Plan assets, fair value | $ 0 | $ 0 | $ 0 | $ 0 |
MERGER-RELATED AND RESTRUCTUR58
MERGER-RELATED AND RESTRUCTURING COSTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Merger Related And Restructuring Costs Details [Abstract] | |||
Merger-related and restructuring costs | $ 203 | $ 225 | $ 119 |
Merger-Related Costs | |||
Merger-related costs | 183 | 198 | 13 |
Accrued merger-related costs, balance at beginning of period | 82 | 6 | 14 |
Costs incurred | 141 | 143 | 13 |
Adjustments | (5) | (1) | |
Cash paid | (165) | (66) | (21) |
Accrued merger-related costs, balance at end of period | 53 | 82 | 6 |
Remaining liability, current portion | 53 | ||
Equity-based compensation expense classified as merger-related costs | 47 | 56 | |
Restructuring Costs | |||
Restructuring costs | 20 | 27 | 106 |
Restructuring reserve, balance at beginning of period | 8 | 43 | 27 |
Costs incurred | 20 | 30 | 106 |
Adjustments | (3) | ||
Cash paid | (16) | (62) | (90) |
Restructuring reserve, balance at end of period | 12 | 8 | 43 |
Remaining liability, current portion | 7 | ||
Charter [Member] | |||
Merger-Related Costs | |||
Merger-related costs | 146 | ||
Comcast [Member] | |||
Merger-Related Costs | |||
Merger-related costs | 37 | 195 | |
DukeNet [Member] | |||
Merger-Related Costs | |||
Merger-related costs | 3 | ||
Employee Termination Costs [Member] | |||
Restructuring Costs | |||
Restructuring reserve, balance at beginning of period | 8 | 39 | 24 |
Costs incurred | 20 | 14 | 88 |
Adjustments | (3) | ||
Cash paid | (16) | (42) | (73) |
Restructuring reserve, balance at end of period | 12 | 8 | 39 |
Other Exit Costs [Member] | |||
Restructuring Costs | |||
Restructuring reserve, balance at beginning of period | 0 | 4 | 3 |
Costs incurred | 0 | 16 | 18 |
Adjustments | 0 | ||
Cash paid | 0 | (20) | (17) |
Restructuring reserve, balance at end of period | 0 | 0 | 4 |
Employee Costs [Member] | |||
Merger-Related Costs | |||
Accrued merger-related costs, balance at beginning of period | 65 | 3 | 7 |
Costs incurred | 64 | 68 | 0 |
Adjustments | 0 | (1) | |
Cash paid | (82) | (5) | (4) |
Accrued merger-related costs, balance at end of period | 47 | 65 | 3 |
Employee Costs [Member] | Charter [Member] | |||
Merger-Related Costs | |||
Merger-related costs | 84 | ||
Employee Costs [Member] | Comcast [Member] | |||
Merger-Related Costs | |||
Merger-related costs | 27 | 121 | |
Other Costs [Member] | |||
Merger-Related Costs | |||
Accrued merger-related costs, balance at beginning of period | 17 | 3 | 7 |
Costs incurred | 77 | 75 | 13 |
Adjustments | (5) | 0 | |
Cash paid | (83) | (61) | (17) |
Accrued merger-related costs, balance at end of period | 6 | 17 | $ 3 |
Other Costs [Member] | Charter [Member] | |||
Merger-Related Costs | |||
Merger-related costs | 62 | ||
Other Costs [Member] | Comcast [Member] | |||
Merger-Related Costs | |||
Merger-related costs | $ 10 | $ 74 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes Details [Abstract] | ||||||
Federal income tax provision, current | $ 444 | $ 363 | $ 631 | |||
Federal income tax provision, deferred | 525 | 681 | 411 | |||
State income tax provision, current | 107 | 98 | 91 | |||
State income tax provision, deferred | 68 | 75 | (48) | |||
Income tax provision | $ 1,144 | 1,217 | 1,085 | |||
U.S. federal statutory income tax rate | 35.00% | |||||
Income tax provision at U.S. federal statutory rate | $ 1,046 | 1,137 | 1,064 | |||
State and local taxes, net of federal tax effects | 114 | 112 | 28 | |||
Other reconciling items | (16) | (32) | (7) | |||
Income tax provision | 1,144 | 1,217 | 1,085 | |||
Impact of certain state tax and local matters on the income tax provision and effective tax rate | 24 | 27 | ||||
Impact of other adjustments on the income tax provision and effective tax rate | 77 | |||||
Deferred income tax liabilities, cable franchise rights and customer relationships | $ (8,627) | $ (8,298) | ||||
Deferred income tax liabilities, property, plant and equipment | (4,740) | (4,466) | ||||
Deferred income tax liabilities, other | (100) | (133) | ||||
Deferred income tax liabilities | (13,467) | (12,897) | ||||
Deferred income tax assets, net operating loss carryforwards | 24 | 92 | ||||
Deferred income tax assets, tax credit carryforwards | 32 | 31 | ||||
Deferred income tax assets, other | 604 | 511 | ||||
Deferred income tax assets, valuation allowances | (23) | (28) | ||||
Deferred income tax assets | 637 | 606 | ||||
Deferred income tax liabilities, net | (12,830) | (12,291) | (10,963) | (12,830) | (12,291) | $ (11,764) |
Deferred income tax liabilities, net, at beginning of year | (12,291) | (11,764) | (10,963) | |||
Deferred income tax provision | (593) | (756) | (363) | |||
Amount recorded in acquisition of Insight | 0 | 0 | 5 | |||
Amount recorded directly to TWC shareholders' equity as a component of accumulated other comprehensive (income) loss, net, related to the change in accumulated unrealized losses on pension benefit obligation | (24) | (230) | 377 | |||
Amount recorded directly to TWC shareholders' equity as a component of accumulated other comprehensive (income) loss, net, related to the change in accumulated deferred gains (losses) on cash flow hedges | 30 | (1) | (66) | |||
Deferred income tax liabilities, net, at end of year | (12,830) | (12,291) | (11,764) | |||
Reserve for uncertain income tax positions at beginning of year | 112 | 108 | 73 | |||
Additions for prior year tax positions | 10 | 16 | 30 | |||
Additions for current year tax positions | 18 | 13 | 19 | |||
Reductions for prior year tax positions | (2) | (5) | 0 | |||
Lapses in statute of limitations | (16) | (5) | (3) | |||
Settlements and reversals of timing difference | (8) | (15) | (11) | |||
Reserve for uncertain income tax positions at end of year | $ 114 | 112 | 108 | |||
Impact of uncertain income tax positions on income tax provision | 83 | 74 | 68 | |||
Impact of uncertain income tax positions on income tax provision - portion attributable to interest and penalties | 14 | 15 | $ 20 | |||
Interest and penalties accrued on uncertain income tax positions | 19 | $ 20 | ||||
Provision (benefit) related to interest and penalties included in income tax provision | $ (7) | $ 6 | ||||
The amount of existing reserves for uncertain income tax positions for which it is reasonably possible that the total amount will decrease within twelve months of the balance sheet date | 28 | |||||
Impact on income tax provision of existing reserves for uncertain income tax positions for which it is reasonably possible that the total amount will decrease within twelve months of the balance sheet date | 23 | |||||
Impact on income tax provision of existing reserves for uncertain income tax positions for which it is reasonably possible that the total amount will decrease within twelve months of the balance sheet date - portion attributable to interest and penalties | $ 2 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Segment Information Details [Abstract] | |||
Number of reportable segments | 3 | ||
Segment Information | |||
Revenue | $ 23,697 | $ 22,812 | $ 22,120 |
Operating costs and expenses | (15,559) | (14,584) | (14,140) |
Merger-related and restructuring costs | (203) | (225) | (119) |
OIBDA | 7,935 | 8,003 | 7,861 |
Depreciation | (3,560) | (3,236) | (3,155) |
Amortization | (136) | (135) | (126) |
Operating Income | 4,239 | 4,632 | 4,580 |
Shared Functions [Member] | |||
Segment Information | |||
Revenue | 0 | 0 | 0 |
Operating costs and expenses | (3,003) | (2,901) | (2,892) |
Merger-related and restructuring costs | (203) | (225) | (119) |
OIBDA | (3,206) | (3,126) | (3,011) |
Intersegment Eliminations [Member] | |||
Segment Information | |||
Revenue | (263) | (244) | (196) |
Operating costs and expenses | 263 | 244 | 196 |
Merger-related and restructuring costs | 0 | 0 | 0 |
OIBDA | 0 | 0 | 0 |
Residential Services Segment [Member] | |||
Segment Information | |||
Revenue | 18,966 | 18,446 | 18,402 |
Operating costs and expenses | (10,477) | (9,823) | (9,714) |
Merger-related and restructuring costs | 0 | 0 | 0 |
OIBDA | 8,489 | 8,623 | 8,688 |
Residential Services Segment [Member] | Video [Member] | |||
Segment Information | |||
Revenue | 9,907 | 10,002 | 10,481 |
Residential Services Segment [Member] | High-Speed Data [Member] | |||
Segment Information | |||
Revenue | 7,029 | 6,428 | 5,822 |
Residential Services Segment [Member] | Voice [Member] | |||
Segment Information | |||
Revenue | 1,931 | 1,932 | 2,027 |
Residential Services Segment [Member] | Other [Member] | |||
Segment Information | |||
Revenue | 99 | 84 | 72 |
Business Services Segment [Member] | |||
Segment Information | |||
Revenue | 3,284 | 2,838 | 2,312 |
Operating costs and expenses | (1,297) | (1,119) | (961) |
Merger-related and restructuring costs | 0 | 0 | 0 |
OIBDA | 1,987 | 1,719 | 1,351 |
Business Services Segment [Member] | Video [Member] | |||
Segment Information | |||
Revenue | 385 | 365 | 347 |
Business Services Segment [Member] | High-Speed Data [Member] | |||
Segment Information | |||
Revenue | 1,609 | 1,341 | 1,099 |
Business Services Segment [Member] | Voice [Member] | |||
Segment Information | |||
Revenue | 599 | 511 | 421 |
Business Services Segment [Member] | Wholesale Transport [Member] | |||
Segment Information | |||
Revenue | 491 | 415 | 251 |
Business Services Segment [Member] | Other [Member] | |||
Segment Information | |||
Revenue | 200 | 206 | 194 |
Other Operations Segment [Member] | |||
Segment Information | |||
Revenue | 1,710 | 1,772 | 1,602 |
Operating costs and expenses | (1,045) | (985) | (769) |
Merger-related and restructuring costs | 0 | 0 | 0 |
OIBDA | 665 | 787 | 833 |
Other Operations Segment [Member] | Advertising [Member] | |||
Segment Information | |||
Revenue | 1,028 | 1,127 | 1,019 |
Other Operations Segment [Member] | Other [Member] | |||
Segment Information | |||
Revenue | $ 682 | $ 645 | $ 583 |
COMMITMENTS AND CONTINGENCIES61
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Commitments And Contingencies [Line Items] | |||
Surety bonds and letters of credit guaranteeing performance of obligations under existing franchise agreements | $ 424 | $ 373 | |
Rent expense | 305 | 298 | $ 257 |
Minimum rental commitments under long-term operating leases due one year from balance sheet date | 170 | ||
Minimum rental commitments under long-term operating leases due more than one year and within two years from balance sheet date | 144 | ||
Minimum rental commitments under long-term operating leases due more than two years and within three years from balance sheet date | 125 | ||
Minimum rental commitments under long-term operating leases due more than three years and within four years from balance sheet date | 99 | ||
Minimum rental commitments under long-term operating leases due more than four years and within five years from balance sheet date | 71 | ||
Minimum rental commitments under long-term operating leases due more than five years from balance sheet date | 245 | ||
Contractual obligations due one year from balance sheet date | 5,975 | ||
Contractual obligations due more than one year and within three years from balance sheet date | 7,947 | ||
Contractual obligations due more than three year and within five years from balance sheet date | 3,445 | ||
Contractual obligations due more than five years from balance sheet date | 10,903 | ||
Total contractual obligations | 28,270 | ||
Employer contributions to pension plans | $ 5 | $ 5 |
ADDITIONAL FINANCIAL INFORMAT62
ADDITIONAL FINANCIAL INFORMATION (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Additional Financial Information Details [Abstract] | |||
Prepaid income taxes | $ 155 | $ 157 | |
Other prepaid expenses | 201 | 208 | |
Other current assets | 17 | 18 | |
Total other current assets | 373 | 383 | |
Accrued interest | 481 | 486 | |
Accrued compensation and benefits | 443 | 397 | |
Accrued insurance | 225 | 199 | |
Accrued dividends | 216 | 0 | |
Accrued sales and other taxes | 150 | 132 | |
Accrued franchise fees | 145 | 151 | |
Other accrued expenses | 419 | 448 | |
Total other current liabilities | 2,079 | 1,813 | |
Interest expense | (1,402) | (1,419) | $ (1,555) |
Interest income | 1 | 0 | 3 |
Interest expense, net | (1,401) | (1,419) | (1,552) |
Income from equity-method investments, net | 28 | 33 | 19 |
Gain on settlement of Verizon Wireless agency agreement | 120 | 0 | 0 |
Other | 2 | 2 | (8) |
Other income, net | 150 | 35 | 11 |
Related Party Transactions | |||
Revenue | 7 | 6 | 7 |
Operating costs and expenses | (213) | (197) | (225) |
Cash paid for interest | (1,482) | (1,562) | (1,740) |
Interest income received | 100 | 127 | 164 |
Cash paid for interest, net | (1,382) | (1,435) | (1,576) |
Cash paid for income taxes | (468) | (366) | (698) |
Cash refunds of income taxes | 15 | 14 | 2 |
Cash paid for income taxes, net | (453) | (352) | (696) |
Purchases of short-term investments in U.S. Treasury securities | (575) | ||
Proceeds from maturity of short-term investments in U.S. Treasury securities | 725 | ||
Value of common stock repurchased and retired that settled in the next quarterly period | 51 | ||
Programming And Content [Member] | |||
Related Party Transactions | |||
Operating costs and expenses | (191) | (176) | (205) |
Other Operating [Member] | |||
Related Party Transactions | |||
Operating costs and expenses | $ (22) | $ (21) | $ (20) |
CONDENSED CONSOLIDATING FINAN63
CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||||||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Condensed Consolidating Financial Statements | |||||||
Cash and equivalents | $ 1,170 | $ 707 | $ 525 | $ 1,170 | $ 707 | $ 525 | $ 3,304 |
Receivables, net | 916 | 949 | |||||
Receivables from affiliated parties | 0 | 0 | |||||
Other current assets | 373 | 383 | |||||
Total current assets | 2,459 | 2,039 | |||||
Investments in and amounts due from consolidated subsidiaries | 0 | 0 | |||||
Investments | 65 | 64 | |||||
Property, plant and equipment, net | 16,945 | 15,990 | |||||
Intangible assets subject to amortization, net | 437 | 523 | |||||
Intangible assets not subject to amortization | 26,014 | 26,012 | |||||
Goodwill | 3,139 | 3,137 | 3,196 | ||||
Other assets | 218 | 370 | |||||
Total assets | 49,277 | 48,135 | |||||
Accounts payable | 656 | 567 | |||||
Deferred revenue and subscriber-related liabilities | 224 | 198 | |||||
Payables to affiliated parties | 0 | 0 | |||||
Accrued programming and content expense | 985 | 902 | |||||
Current maturities of long-term debt | 5 | 1,017 | |||||
Other current liabilities | 2,079 | 1,813 | |||||
Total current liabilities | 3,949 | 4,497 | |||||
Long-term debt | 22,497 | 22,604 | |||||
Deferred income tax liabilities, net | 12,830 | 12,291 | |||||
Long-term payables to affiliated parties | 0 | 0 | |||||
Other liabilities | 1,002 | 726 | |||||
Shareholders' equity due to (from) TWC and subsidiaries | 0 | 0 | |||||
Other TWC shareholders' equity | 8,995 | 8,013 | |||||
Total TWC shareholders' equity | 8,995 | 8,013 | |||||
Noncontrolling interests | 4 | 4 | |||||
Total equity | 8,999 | 8,017 | 6,947 | 7,283 | |||
Total liabilities and equity | 49,277 | 48,135 | |||||
Revenue | 23,697 | 22,812 | 22,120 | ||||
Programming and content | 5,815 | 5,294 | 4,950 | ||||
Sales and marketing | 2,379 | 2,192 | 2,048 | ||||
Technical operations | 1,669 | 1,530 | 1,500 | ||||
Customer care | 900 | 839 | 766 | ||||
Other operating | 4,796 | 4,729 | 4,876 | ||||
Depreciation | 3,560 | 3,236 | 3,155 | ||||
Amortization | 136 | 135 | 126 | ||||
Merger-related and restructuring costs | 203 | 225 | 119 | ||||
Total costs and expenses | 19,458 | 18,180 | 17,540 | ||||
Operating Income | 4,239 | 4,632 | 4,580 | ||||
Equity in pretax income of consolidated subsidiaries | 0 | 0 | 0 | ||||
Interest expense, net | (1,401) | (1,419) | (1,552) | ||||
Other income, net | 150 | 35 | 11 | ||||
Income before income taxes | 2,988 | 3,248 | 3,039 | ||||
Income tax provision | (1,144) | (1,217) | (1,085) | ||||
Net income | 1,844 | 2,031 | 1,954 | ||||
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | ||||
Net income attributable to TWC shareholders | 1,844 | 2,031 | 1,954 | ||||
Net income | 1,844 | 2,031 | 1,954 | ||||
Change in accumulated unrealized losses on pension benefit obligation, net of tax | (39) | (369) | 604 | ||||
Change in accumulated deferred gains (losses) on cash flow hedges, net of tax | (50) | 1 | 104 | ||||
Other changes | (1) | 0 | (1) | ||||
Other comprehensive income (loss) | (90) | (368) | 707 | ||||
Comprehensive income | 1,754 | 1,663 | 2,661 | ||||
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | 0 | ||||
Comprehensive income attributable to TWC shareholders | 1,754 | 1,663 | 2,661 | ||||
Cash provided by operating activities | 6,539 | 6,350 | 5,753 | ||||
Capital expenditures | (4,446) | (4,097) | (3,198) | ||||
Business acquisitions, net of cash acquired | 0 | 0 | (423) | ||||
Purchases of investments | (4) | (2) | (588) | ||||
Proceeds from sale, maturity and collection of investments | 3 | 19 | 726 | ||||
Acquisition of intangible assets | (51) | (39) | (40) | ||||
Other investing activities | 153 | 27 | 47 | ||||
Cash used by investing activities | (4,345) | (4,092) | (3,476) | ||||
Short-term borrowings (repayments), net | (507) | 507 | 0 | ||||
Repayments of long-term debt | (500) | (1,750) | (1,500) | ||||
Repayments of long-term debt assumed in acquisitions | 0 | 0 | (138) | ||||
Redemption of mandatorily redeemable preferred equity | 0 | 0 | (300) | ||||
Dividends paid | (865) | (857) | (758) | ||||
Repurchases of common stock | 0 | (259) | (2,509) | ||||
Proceeds from exercise of stock options | 129 | 226 | 138 | ||||
Excess tax benefit from equity-based compensation | 92 | 141 | 93 | ||||
Taxes paid in cash in lieu of shares issued for equity-based compensation | (72) | (76) | (68) | ||||
Net change in investments in and amounts due to and from consolidated subsidiaries | 0 | 0 | 0 | ||||
Other financing activities | (8) | (8) | (14) | ||||
Cash used by financing activities | (1,731) | (2,076) | (5,056) | ||||
Increase (decrease) in cash and equivalents | 463 | 182 | (2,779) | ||||
Cash and equivalents at beginning of year | 707 | 525 | 3,304 | ||||
Cash and equivalents at end of year | 1,170 | 707 | 525 | ||||
Eliminations [Member] | |||||||
Condensed Consolidating Financial Statements | |||||||
Cash and equivalents | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Receivables, net | 0 | 0 | |||||
Receivables from affiliated parties | (254) | (242) | |||||
Other current assets | 0 | 0 | |||||
Total current assets | (254) | (242) | |||||
Investments in and amounts due from consolidated subsidiaries | (103,808) | (98,832) | |||||
Investments | 0 | 0 | |||||
Property, plant and equipment, net | 0 | 0 | |||||
Intangible assets subject to amortization, net | 0 | 0 | |||||
Intangible assets not subject to amortization | 0 | 0 | |||||
Goodwill | 0 | 0 | |||||
Other assets | (117) | (24) | |||||
Total assets | (104,179) | (99,098) | |||||
Accounts payable | 0 | 0 | |||||
Deferred revenue and subscriber-related liabilities | 0 | 0 | |||||
Payables to affiliated parties | (254) | (242) | |||||
Accrued programming and content expense | 0 | 0 | |||||
Current maturities of long-term debt | 0 | 0 | |||||
Other current liabilities | 0 | 0 | |||||
Total current liabilities | (254) | (242) | |||||
Long-term debt | 0 | 0 | |||||
Deferred income tax liabilities, net | (117) | (24) | |||||
Long-term payables to affiliated parties | (22,343) | (22,343) | |||||
Other liabilities | 0 | 0 | |||||
Shareholders' equity due to (from) TWC and subsidiaries | 0 | 0 | |||||
Other TWC shareholders' equity | (81,465) | (76,489) | |||||
Total TWC shareholders' equity | (81,465) | (76,489) | |||||
Noncontrolling interests | 0 | 0 | |||||
Total equity | (81,465) | (76,489) | |||||
Total liabilities and equity | (104,179) | (99,098) | |||||
Revenue | 0 | 0 | 0 | ||||
Programming and content | 0 | 0 | 0 | ||||
Sales and marketing | 0 | 0 | 0 | ||||
Technical operations | 0 | 0 | 0 | ||||
Customer care | 0 | 0 | 0 | ||||
Other operating | 0 | 0 | 0 | ||||
Depreciation | 0 | 0 | 0 | ||||
Amortization | 0 | 0 | 0 | ||||
Merger-related and restructuring costs | 0 | 0 | 0 | ||||
Total costs and expenses | 0 | 0 | 0 | ||||
Operating Income | 0 | 0 | 0 | ||||
Equity in pretax income of consolidated subsidiaries | (7,737) | (8,358) | (6,932) | ||||
Interest expense, net | 0 | 0 | 0 | ||||
Other income, net | 0 | 0 | 0 | ||||
Income before income taxes | (7,737) | (8,358) | (6,932) | ||||
Income tax provision | 2,304 | 2,571 | 2,112 | ||||
Net income | (5,433) | (5,787) | (4,820) | ||||
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | ||||
Net income attributable to TWC shareholders | (5,433) | (5,787) | (4,820) | ||||
Net income | (5,433) | (5,787) | (4,820) | ||||
Change in accumulated unrealized losses on pension benefit obligation, net of tax | 0 | 0 | 0 | ||||
Change in accumulated deferred gains (losses) on cash flow hedges, net of tax | 0 | 0 | 0 | ||||
Other changes | 1 | 1 | |||||
Other comprehensive income (loss) | 1 | 0 | 1 | ||||
Comprehensive income | (5,432) | (5,787) | (4,819) | ||||
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | 0 | ||||
Comprehensive income attributable to TWC shareholders | (5,432) | (5,787) | (4,819) | ||||
Cash provided by operating activities | 0 | 0 | 0 | ||||
Capital expenditures | 0 | 0 | 0 | ||||
Business acquisitions, net of cash acquired | 0 | ||||||
Purchases of investments | 0 | 0 | 0 | ||||
Proceeds from sale, maturity and collection of investments | 0 | 0 | 0 | ||||
Acquisition of intangible assets | 0 | 0 | 0 | ||||
Other investing activities | 0 | 0 | 0 | ||||
Cash used by investing activities | 0 | 0 | 0 | ||||
Short-term borrowings (repayments), net | 0 | 0 | |||||
Repayments of long-term debt | 0 | 0 | 0 | ||||
Repayments of long-term debt assumed in acquisitions | 0 | ||||||
Redemption of mandatorily redeemable preferred equity | 0 | ||||||
Dividends paid | 0 | 0 | 0 | ||||
Repurchases of common stock | 0 | 0 | |||||
Proceeds from exercise of stock options | 0 | 0 | 0 | ||||
Excess tax benefit from equity-based compensation | 0 | 0 | 0 | ||||
Taxes paid in cash in lieu of shares issued for equity-based compensation | 0 | 0 | 0 | ||||
Net change in investments in and amounts due to and from consolidated subsidiaries | 0 | 0 | 0 | ||||
Other financing activities | 0 | 0 | 0 | ||||
Cash used by financing activities | 0 | 0 | 0 | ||||
Increase (decrease) in cash and equivalents | 0 | 0 | 0 | ||||
Cash and equivalents at beginning of year | 0 | 0 | 0 | ||||
Cash and equivalents at end of year | 0 | 0 | 0 | ||||
Parent Company [Member] | |||||||
Condensed Consolidating Financial Statements | |||||||
Cash and equivalents | 901 | 481 | 316 | 901 | 481 | 316 | 2,174 |
Receivables, net | 23 | 31 | |||||
Receivables from affiliated parties | 225 | 215 | |||||
Other current assets | 125 | 113 | |||||
Total current assets | 1,274 | 840 | |||||
Investments in and amounts due from consolidated subsidiaries | 46,841 | 44,790 | |||||
Investments | 0 | 0 | |||||
Property, plant and equipment, net | 0 | 0 | |||||
Intangible assets subject to amortization, net | 0 | 0 | |||||
Intangible assets not subject to amortization | 0 | 0 | |||||
Goodwill | 0 | 0 | |||||
Other assets | 269 | 308 | |||||
Total assets | 48,384 | 45,938 | |||||
Accounts payable | 0 | 0 | |||||
Deferred revenue and subscriber-related liabilities | 0 | 0 | |||||
Payables to affiliated parties | 29 | 27 | |||||
Accrued programming and content expense | 0 | 0 | |||||
Current maturities of long-term debt | 0 | 1,008 | |||||
Other current liabilities | 725 | 529 | |||||
Total current liabilities | 754 | 1,564 | |||||
Long-term debt | 20,370 | 20,467 | |||||
Deferred income tax liabilities, net | 0 | 26 | |||||
Long-term payables to affiliated parties | 7,641 | 7,641 | |||||
Other liabilities | 460 | 154 | |||||
Shareholders' equity due to (from) TWC and subsidiaries | 10,164 | 8,073 | |||||
Other TWC shareholders' equity | 8,995 | 8,013 | |||||
Total TWC shareholders' equity | 19,159 | 16,086 | |||||
Noncontrolling interests | 0 | 0 | |||||
Total equity | 19,159 | 16,086 | |||||
Total liabilities and equity | 48,384 | 45,938 | |||||
Revenue | 0 | 0 | 0 | ||||
Programming and content | 0 | 0 | 0 | ||||
Sales and marketing | 0 | 0 | 0 | ||||
Technical operations | 0 | 0 | 0 | ||||
Customer care | 0 | 0 | 0 | ||||
Other operating | 0 | 0 | 0 | ||||
Depreciation | 0 | 0 | 0 | ||||
Amortization | 0 | 0 | 0 | ||||
Merger-related and restructuring costs | 67 | 66 | 0 | ||||
Total costs and expenses | 67 | 66 | 0 | ||||
Operating Income | (67) | (66) | 0 | ||||
Equity in pretax income of consolidated subsidiaries | 3,172 | 3,516 | 3,273 | ||||
Interest expense, net | (238) | (202) | (235) | ||||
Other income, net | 121 | 0 | 1 | ||||
Income before income taxes | 2,988 | 3,248 | 3,039 | ||||
Income tax provision | (1,144) | (1,217) | (1,085) | ||||
Net income | 1,844 | 2,031 | 1,954 | ||||
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | ||||
Net income attributable to TWC shareholders | 1,844 | 2,031 | 1,954 | ||||
Net income | 1,844 | 2,031 | 1,954 | ||||
Change in accumulated unrealized losses on pension benefit obligation, net of tax | (39) | (369) | 604 | ||||
Change in accumulated deferred gains (losses) on cash flow hedges, net of tax | (50) | 1 | 104 | ||||
Other changes | (1) | (1) | |||||
Other comprehensive income (loss) | (90) | (368) | 707 | ||||
Comprehensive income | 1,754 | 1,663 | 2,661 | ||||
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | 0 | ||||
Comprehensive income attributable to TWC shareholders | 1,754 | 1,663 | 2,661 | ||||
Cash provided by operating activities | (139) | (254) | (188) | ||||
Capital expenditures | 0 | 0 | 0 | ||||
Business acquisitions, net of cash acquired | 0 | ||||||
Purchases of investments | 0 | 0 | (575) | ||||
Proceeds from sale, maturity and collection of investments | 1 | 18 | 726 | ||||
Acquisition of intangible assets | 0 | 0 | 0 | ||||
Other investing activities | 119 | 0 | 0 | ||||
Cash used by investing activities | 120 | 18 | 151 | ||||
Short-term borrowings (repayments), net | (507) | 507 | |||||
Repayments of long-term debt | (500) | (1,750) | (1,500) | ||||
Repayments of long-term debt assumed in acquisitions | 0 | ||||||
Redemption of mandatorily redeemable preferred equity | 0 | ||||||
Dividends paid | (865) | (857) | (758) | ||||
Repurchases of common stock | (259) | (2,509) | |||||
Proceeds from exercise of stock options | 129 | 226 | 138 | ||||
Excess tax benefit from equity-based compensation | 92 | 141 | 92 | ||||
Taxes paid in cash in lieu of shares issued for equity-based compensation | 0 | 0 | 0 | ||||
Net change in investments in and amounts due to and from consolidated subsidiaries | 2,091 | 2,394 | 2,725 | ||||
Other financing activities | (1) | (1) | (9) | ||||
Cash used by financing activities | 439 | 401 | (1,821) | ||||
Increase (decrease) in cash and equivalents | 420 | 165 | (1,858) | ||||
Cash and equivalents at beginning of year | 481 | 316 | 2,174 | ||||
Cash and equivalents at end of year | 901 | 481 | 316 | ||||
Guarantor Subsidiary [Member] | |||||||
Condensed Consolidating Financial Statements | |||||||
Cash and equivalents | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Receivables, net | 0 | 0 | |||||
Receivables from affiliated parties | 0 | 0 | |||||
Other current assets | 31 | 46 | |||||
Total current assets | 31 | 46 | |||||
Investments in and amounts due from consolidated subsidiaries | 49,326 | 46,401 | |||||
Investments | 53 | 51 | |||||
Property, plant and equipment, net | 26 | 28 | |||||
Intangible assets subject to amortization, net | 18 | 5 | |||||
Intangible assets not subject to amortization | 0 | 0 | |||||
Goodwill | 0 | 0 | |||||
Other assets | 10 | 12 | |||||
Total assets | 49,464 | 46,543 | |||||
Accounts payable | 0 | 0 | |||||
Deferred revenue and subscriber-related liabilities | 0 | 0 | |||||
Payables to affiliated parties | 222 | 212 | |||||
Accrued programming and content expense | 0 | 0 | |||||
Current maturities of long-term debt | 0 | 0 | |||||
Other current liabilities | 66 | 63 | |||||
Total current liabilities | 288 | 275 | |||||
Long-term debt | 2,056 | 2,061 | |||||
Deferred income tax liabilities, net | 249 | 230 | |||||
Long-term payables to affiliated parties | 14,702 | 14,702 | |||||
Other liabilities | 80 | 91 | |||||
Shareholders' equity due to (from) TWC and subsidiaries | 2,076 | 1,216 | |||||
Other TWC shareholders' equity | 30,013 | 27,968 | |||||
Total TWC shareholders' equity | 32,089 | 29,184 | |||||
Noncontrolling interests | 0 | 0 | |||||
Total equity | 32,089 | 29,184 | |||||
Total liabilities and equity | 49,464 | 46,543 | |||||
Revenue | 0 | 0 | 0 | ||||
Programming and content | 0 | 0 | 0 | ||||
Sales and marketing | 0 | 0 | 0 | ||||
Technical operations | 0 | 0 | 0 | ||||
Customer care | 0 | 0 | 0 | ||||
Other operating | 0 | 0 | 0 | ||||
Depreciation | 0 | 0 | 0 | ||||
Amortization | 0 | 0 | 0 | ||||
Merger-related and restructuring costs | 0 | 0 | 3 | ||||
Total costs and expenses | 0 | 0 | 3 | ||||
Operating Income | 0 | 0 | (3) | ||||
Equity in pretax income of consolidated subsidiaries | 4,565 | 4,842 | 3,659 | ||||
Interest expense, net | (1,416) | (1,426) | (501) | ||||
Other income, net | (1) | 6 | (5) | ||||
Income before income taxes | 3,148 | 3,422 | 3,150 | ||||
Income tax provision | (1,193) | (1,284) | (1,139) | ||||
Net income | 1,955 | 2,138 | 2,011 | ||||
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | ||||
Net income attributable to TWC shareholders | 1,955 | 2,138 | 2,011 | ||||
Net income | 1,955 | 2,138 | 2,011 | ||||
Change in accumulated unrealized losses on pension benefit obligation, net of tax | 0 | 0 | 0 | ||||
Change in accumulated deferred gains (losses) on cash flow hedges, net of tax | 0 | 0 | 0 | ||||
Other changes | 0 | 0 | |||||
Other comprehensive income (loss) | 0 | 0 | 0 | ||||
Comprehensive income | 1,955 | 2,138 | 2,011 | ||||
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | 0 | ||||
Comprehensive income attributable to TWC shareholders | 1,955 | 2,138 | 2,011 | ||||
Cash provided by operating activities | (1,499) | (1,345) | (595) | ||||
Capital expenditures | 0 | 0 | 0 | ||||
Business acquisitions, net of cash acquired | (429) | ||||||
Purchases of investments | (4) | (2) | (13) | ||||
Proceeds from sale, maturity and collection of investments | 0 | 1 | 0 | ||||
Acquisition of intangible assets | (15) | (3) | (3) | ||||
Other investing activities | 0 | (2) | 9 | ||||
Cash used by investing activities | (19) | (6) | (436) | ||||
Short-term borrowings (repayments), net | 0 | 0 | |||||
Repayments of long-term debt | 0 | 0 | 0 | ||||
Repayments of long-term debt assumed in acquisitions | 0 | ||||||
Redemption of mandatorily redeemable preferred equity | (300) | ||||||
Dividends paid | 0 | 0 | 0 | ||||
Repurchases of common stock | 0 | 0 | |||||
Proceeds from exercise of stock options | 0 | 0 | 0 | ||||
Excess tax benefit from equity-based compensation | 0 | 0 | 0 | ||||
Taxes paid in cash in lieu of shares issued for equity-based compensation | 0 | 0 | 0 | ||||
Net change in investments in and amounts due to and from consolidated subsidiaries | 1,518 | 1,351 | 1,331 | ||||
Other financing activities | 0 | 0 | 0 | ||||
Cash used by financing activities | 1,518 | 1,351 | 1,031 | ||||
Increase (decrease) in cash and equivalents | 0 | 0 | 0 | ||||
Cash and equivalents at beginning of year | 0 | 0 | 0 | ||||
Cash and equivalents at end of year | 0 | 0 | 0 | ||||
Non-Guarantor Subsidiaries [Member] | |||||||
Condensed Consolidating Financial Statements | |||||||
Cash and equivalents | 269 | 226 | 209 | 269 | 226 | $ 209 | $ 1,130 |
Receivables, net | 893 | 918 | |||||
Receivables from affiliated parties | 29 | 27 | |||||
Other current assets | 217 | 224 | |||||
Total current assets | 1,408 | 1,395 | |||||
Investments in and amounts due from consolidated subsidiaries | 7,641 | 7,641 | |||||
Investments | 12 | 13 | |||||
Property, plant and equipment, net | 16,919 | 15,962 | |||||
Intangible assets subject to amortization, net | 419 | 518 | |||||
Intangible assets not subject to amortization | 26,014 | 26,012 | |||||
Goodwill | 3,139 | 3,137 | |||||
Other assets | 56 | 74 | |||||
Total assets | 55,608 | 54,752 | |||||
Accounts payable | 656 | 567 | |||||
Deferred revenue and subscriber-related liabilities | 224 | 198 | |||||
Payables to affiliated parties | 3 | 3 | |||||
Accrued programming and content expense | 985 | 902 | |||||
Current maturities of long-term debt | 5 | 9 | |||||
Other current liabilities | 1,288 | 1,221 | |||||
Total current liabilities | 3,161 | 2,900 | |||||
Long-term debt | 71 | 76 | |||||
Deferred income tax liabilities, net | 12,698 | 12,059 | |||||
Long-term payables to affiliated parties | 0 | 0 | |||||
Other liabilities | 462 | 481 | |||||
Shareholders' equity due to (from) TWC and subsidiaries | (12,240) | (9,289) | |||||
Other TWC shareholders' equity | 51,452 | 48,521 | |||||
Total TWC shareholders' equity | 39,212 | 39,232 | |||||
Noncontrolling interests | 4 | 4 | |||||
Total equity | 39,216 | 39,236 | |||||
Total liabilities and equity | $ 55,608 | $ 54,752 | |||||
Revenue | 23,697 | 22,812 | 22,120 | ||||
Programming and content | 5,815 | 5,294 | 4,950 | ||||
Sales and marketing | 2,379 | 2,192 | 2,048 | ||||
Technical operations | 1,669 | 1,530 | 1,500 | ||||
Customer care | 900 | 839 | 766 | ||||
Other operating | 4,796 | 4,729 | 4,876 | ||||
Depreciation | 3,560 | 3,236 | 3,155 | ||||
Amortization | 136 | 135 | 126 | ||||
Merger-related and restructuring costs | 136 | 159 | 116 | ||||
Total costs and expenses | 19,391 | 18,114 | 17,537 | ||||
Operating Income | 4,306 | 4,698 | 4,583 | ||||
Equity in pretax income of consolidated subsidiaries | 0 | 0 | 0 | ||||
Interest expense, net | 253 | 209 | (816) | ||||
Other income, net | 30 | 29 | 15 | ||||
Income before income taxes | 4,589 | 4,936 | 3,782 | ||||
Income tax provision | (1,111) | (1,287) | (973) | ||||
Net income | 3,478 | 3,649 | 2,809 | ||||
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | ||||
Net income attributable to TWC shareholders | 3,478 | 3,649 | 2,809 | ||||
Net income | 3,478 | 3,649 | 2,809 | ||||
Change in accumulated unrealized losses on pension benefit obligation, net of tax | 0 | 0 | 0 | ||||
Change in accumulated deferred gains (losses) on cash flow hedges, net of tax | 0 | 0 | 0 | ||||
Other changes | (1) | (1) | |||||
Other comprehensive income (loss) | (1) | 0 | (1) | ||||
Comprehensive income | 3,477 | 3,649 | 2,808 | ||||
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | 0 | ||||
Comprehensive income attributable to TWC shareholders | 3,477 | 3,649 | 2,808 | ||||
Cash provided by operating activities | 8,177 | 7,949 | 6,536 | ||||
Capital expenditures | (4,446) | (4,097) | (3,198) | ||||
Business acquisitions, net of cash acquired | 6 | ||||||
Purchases of investments | 0 | 0 | 0 | ||||
Proceeds from sale, maturity and collection of investments | 2 | 0 | 0 | ||||
Acquisition of intangible assets | (36) | (36) | (37) | ||||
Other investing activities | 34 | 29 | 38 | ||||
Cash used by investing activities | (4,446) | (4,104) | (3,191) | ||||
Short-term borrowings (repayments), net | 0 | 0 | |||||
Repayments of long-term debt | 0 | 0 | 0 | ||||
Repayments of long-term debt assumed in acquisitions | (138) | ||||||
Redemption of mandatorily redeemable preferred equity | 0 | ||||||
Dividends paid | 0 | 0 | 0 | ||||
Repurchases of common stock | 0 | 0 | |||||
Proceeds from exercise of stock options | 0 | 0 | 0 | ||||
Excess tax benefit from equity-based compensation | 0 | 0 | 1 | ||||
Taxes paid in cash in lieu of shares issued for equity-based compensation | (72) | (76) | (68) | ||||
Net change in investments in and amounts due to and from consolidated subsidiaries | (3,609) | (3,745) | (4,056) | ||||
Other financing activities | (7) | (7) | (5) | ||||
Cash used by financing activities | (3,688) | (3,828) | (4,266) | ||||
Increase (decrease) in cash and equivalents | 43 | 17 | (921) | ||||
Cash and equivalents at beginning of year | 226 | 209 | 1,130 | ||||
Cash and equivalents at end of year | $ 269 | $ 226 | $ 209 |