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T AT&T

Filed: 19 Apr 17, 8:00pm
April 20, 2017

Division of Corporation Finance
Securities and Exchange Commission
100 F Street, NE, Mail Stop 3720
Washington, DC  20549

Re:AT&T Inc.
Form 10-K for Fiscal Year Ended December 31, 2016
Filed February 17, 2017
File No. 001-8610

Ladies and Gentlemen:

We are in receipt of the letter from the staff (the "staff") of the Securities and Exchange Commission (the "Commission"), dated April 7, 2017 to Mr. John J. Stephens of AT&T Inc. (the "Company" or "we"). For your convenience, we have included the staff's comment herein and included our response accordingly.

The Company's response to the staff's comment is set forth below and revised disclosure has been included. The Company will include the additional disclosure in the next filing of the applicable form where disclosure would be appropriate.

Exhibit 13
Supplemental Operating Information, page 14
1.As the financial measures included in this presentation combine the results of one reportable segment with portions of another reportable segment, they are not presented in accordance with ASC 280 and as a result these financial measures are non-GAAP measures. Accordingly, please revise your disclosure herein and in your earnings release to comply with Item 10(e) of Regulation S-K. Please provide us with your proposed disclosures.

Response:
In response to the staff's comment, we will modify future filings, beginning with our Form 10-Q for the quarter ended March 31, 2017, in accordance with Item 10(e) of Regulation S-K, including a reconciliation of the supplemental measures in a "Discussion and Reconciliation of Non-GAAP Measure" section of Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. We will also modify the disclosures included with Exhibit 99.3 of our Form 8-K reporting on Item 2.02, in accordance with Item 10(e) to the extent applicable thereto, beginning with the quarter ended March 31, 2017.

We will reconcile our supplemental measures to the most directly comparable financial measures calculated and presented in accordance with Generally Accepted Accounting Principles by combining the results of our Consumer Mobility and Business Solutions segments, and then adjusting to remove non-wireless operations. An example, using our 2016 Form 10-K results, of this disclosure is as follows:


Discussion and Reconciliation of Non-GAAP Measure
We believe the following measure is relevant and useful information to investors as it is used by management as a method of comparing performance with that of many of our competitors. Supplemental measures should be considered in addition to, but not as a substitute of, our consolidated and segment financial information.

Supplemental Operational Measure
We provide a supplemental discussion of our domestic wireless operations that is calculated by combining our Consumer Mobility and Business Solutions segments, and then adjusting to remove non-wireless operations. The following table presents a reconciliation of our supplemental AT&T Mobility results.

             
For the year ended December 31, 2016 Consumer Mobility  Business Solutions  
Adjustments1
  AT&T Mobility 
Operating Revenues            
   Wireless service $27,536  $31,850  $-  $59,386 
   Fixed strategic services  -   11,389   (11,389)  - 
   Legacy voice and data services  -   16,364   (16,364)  - 
   Other service and equipment  -   3,615   (3,615)  - 
   Wireless equipment  5,664   7,770   -   13,434 
Total Operating Revenues  33,200   70,988   (31,368)  72,820 
                 
Operating Expenses                
Operations and support  19,659   44,330   (20,104)  43,885 
EBITDA  13,541   26,658   (11,264)  28,935 
Depreciation and amortization  3,716   9,832   (5,256)  8,292 
Total Operating Expenses  23,375   54,162   (25,360)  52,177 
Operating Income  9,825   16,826   (6,008)  20,643 
Equity in Net Income (Loss) of Affiliates  -   -   -   - 
Operating Contribution $9,825  $16,826  $(6,008) $20,643 
1 Non-wireless operations reported in Business Solutions segment
 


             
 For the year ended December 31, 2015 Consumer Mobility  Business Solutions  
Adjustments1
  AT&T Mobility 
Operating Revenues            
   Wireless service $29,150  $30,687  $-  $59,837 
   Fixed strategic services  -   10,461   (10,461)  - 
   Legacy voice and data services  -   18,468   (18,468)  - 
   Other service and equipment  -   3,559   (3,559)  - 
   Wireless equipment  5,916   7,952   -   13,868 
Total Operating Revenues  35,066   71,127   (32,488)  73,705 
                 
Operating Expenses                
Operations and support  21,477   44,946   (20,634)  45,789 
EBITDA  13,589   26,181   (11,854)  27,916 
Depreciation and amortization  3,851   9,789   (5,527)  8,113 
Total Operating Expenses  25,328   54,735   (26,161)  53,902 
Operating Income  9,738   16,392   (6,327)  19,803 
Equity in Net Income (Loss) of Affiliates  -   -   -   - 
Operating Contribution $9,738  $16,392  $(6,327) $19,803 
1 Non-wireless operations reported in Business Solutions segment
 

Please let me know if you have additional comments.

Sincerely,


/s/ John J. Stephens
John J. Stephens
Senior Executive Vice President
And Chief Financial Officer