Standalone AT&T | |||||||||||||||||||||||||||||||||||||||||
Supplemental Unaudited Quarterly Financial Information | |||||||||||||||||||||||||||||||||||||||||
Dollars in millions | |||||||||||||||||||||||||||||||||||||||||
Unaudited | |||||||||||||||||||||||||||||||||||||||||
Operating Revenues | 3/31/20 | 6/30/20 | 9/30/20 | 12/31/20 | 2020 | 3/31/21 | 6/30/21 | 9/30/21 | 12/31/21 | 2021 | 3/31/22 | 6/30/22 | |||||||||||||||||||||||||||||
Revenues from Continuing Operations | $ | 35,357 | $ | 34,527 | $ | 35,407 | $ | 37,759 | $ | 143,050 | $ | 35,877 | $ | 35,740 | $ | 31,326 | $ | 31,095 | $ | 134,038 | $ | 29,712 | $ | 29,643 | |||||||||||||||||
[A] | Less: Video | (7,407) | (7,021) | (7,014) | (7,168) | (28,610) | (6,725) | (6,639) | (2,149) | — | (15,513) | — | — | ||||||||||||||||||||||||||||
[B] | Less: Other dispositions (Held-for-sale) | (369) | (369) | (420) | (256) | (1,414) | (231) | (158) | (64) | — | (453) | — | — | ||||||||||||||||||||||||||||
[H] | Less: Intercompany eliminations | 64 | 55 | 65 | 83 | 267 | 62 | 57 | 17 | — | 136 | — | — | ||||||||||||||||||||||||||||
Standalone AT&T Operating Revenues | $ | 27,645 | $ | 27,192 | $ | 28,038 | $ | 30,418 | $ | 113,293 | $ | 28,983 | $ | 29,000 | $ | 29,130 | $ | 31,095 | $ | 118,208 | $ | 29,712 | $ | 29,643 | |||||||||||||||||
Revenue from Continuing Operations Growth Rate Y/Y | 1.5 | % | 3.5 | % | -11.5 | % | -17.6 | % | -6.3 | % | -17.2 | % | -17.1 | % | |||||||||||||||||||||||||||
Standalone AT&T Revenue Growth Rate Y/Y | 4.8 | % | 6.6 | % | 3.9 | % | 2.2 | % | 4.3 | % | 2.5 | % | 2.2 | % | |||||||||||||||||||||||||||
1
Operations and Support Expenses | 3/31/20 | 6/30/20 | 9/30/20 | 12/31/20 | 2020 | 3/31/21 | 6/30/21 | 9/30/21 | 12/31/21 | 2021 | 3/31/22 | 6/30/22 | |||||||||||||||||||||||||||||
Operations and Support Expenses from Continuing Operations | $ | 22,369 | $ | 23,311 | $ | 23,733 | $ | 42,742 | $ | 112,155 | $ | 24,217 | $ | 23,739 | $ | 20,632 | $ | 21,701 | $ | 90,289 | $ | 19,713 | $ | 20,237 | |||||||||||||||||
[I] | Non-GAAP Adjustments | 720 | (854) | 32 | (15,573) | (15,675) | (1) | 70 | (109) | (86) | (126) | (191) | (924) | ||||||||||||||||||||||||||||
Adjusted Operations and Support Expenses from Continuing Operations | 23,089 | 22,457 | 23,765 | 27,169 | 96,480 | 24,216 | 23,809 | 20,523 | 21,615 | 90,163 | 19,522 | 19,313 | |||||||||||||||||||||||||||||
[A] | Less: Video | (6,020) | (5,809) | (5,887) | (6,458) | (24,174) | (5,660) | (5,275) | (1,731) | — | (12,666) | — | — | ||||||||||||||||||||||||||||
[B] | Less: Other dispositions (Held-for-sale) | (272) | (268) | (310) | (190) | (1,040) | (194) | (115) | (47) | — | (356) | — | — | ||||||||||||||||||||||||||||
[H] | Less: Intercompany eliminations | 64 | 55 | 65 | 83 | 267 | 62 | 57 | 17 | — | 136 | — | — | ||||||||||||||||||||||||||||
[D] | Less: Reclassification of allocations for separated businesses | 76 | 86 | 76 | 84 | 322 | 15 | 19 | 16 | (4) | 46 | — | — | ||||||||||||||||||||||||||||
[C] | Add: DTV-related retained costs | 350 | 350 | 350 | 350 | 1,400 | 350 | 350 | 117 | — | 817 | — | — | ||||||||||||||||||||||||||||
Standalone AT&T Adjusted Operations and Support Expenses | $ | 17,287 | $ | 16,871 | $ | 18,059 | $ | 21,038 | $ | 73,255 | $ | 18,789 | $ | 18,845 | $ | 18,895 | $ | 21,611 | $ | 78,140 | $ | 19,522 | $ | 19,313 | |||||||||||||||||
Operations and Support Expenses from Continuing Operations Growth Rate Y/Y | 8.3 | % | 1.8 | % | -13.1 | % | -49.2 | % | -19.5 | % | -18.6 | % | -14.8 | % | |||||||||||||||||||||||||||
Adjusted Operations and Support Expenses from Continuing Operations Growth Rate Y/Y | 4.9 | % | 6.0 | % | -13.6 | % | -20.4 | % | -6.5 | % | -19.4 | % | -18.9 | % | |||||||||||||||||||||||||||
Standalone AT&T Adjusted Operations and Support Expenses Growth Rate Y/Y | 8.7 | % | 11.7 | % | 4.6 | % | 2.7 | % | 6.7 | % | 3.9 | % | 2.5 | % | |||||||||||||||||||||||||||
2
Depreciation and Amortization Expense | 3/31/20 | 6/30/20 | 9/30/20 | 12/31/20 | 2020 | 3/31/21 | 6/30/21 | 9/30/21 | 12/31/21 | 2021 | 3/31/22 | 6/30/22 | |||||||||||||||||||||||||||||
Depreciation and Amortization Expense from Continuing Operations | $ | 5,705 | $ | 5,655 | $ | 5,610 | $ | 5,553 | $ | 22,523 | $ | 4,466 | $ | 4,429 | $ | 4,457 | $ | 4,500 | $ | 17,852 | $ | 4,462 | $ | 4,450 | |||||||||||||||||
[I] | Non-GAAP Adjustments | (913) | (878) | (839) | (811) | (3,441) | (85) | (28) | (28) | (28) | (169) | (27) | (17) | ||||||||||||||||||||||||||||
Adjusted Depreciation and Amortization Expense from Continuing Operations | 4,792 | 4,777 | 4,771 | 4,742 | 19,082 | 4,381 | 4,401 | 4,429 | 4,472 | 17,683 | 4,435 | 4,433 | |||||||||||||||||||||||||||||
[A] | Less: Video | (591) | (593) | (557) | (521) | (2,262) | (164) | (148) | (44) | — | (356) | — | — | ||||||||||||||||||||||||||||
[B] | Less: Other dispositions (Held-for-sale) | (4) | (4) | (4) | (3) | (15) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
[C] | Add: DTV-related retained costs | 180 | 180 | 180 | 180 | 720 | 180 | 180 | 60 | — | 420 | — | — | ||||||||||||||||||||||||||||
Standalone AT&T Adjusted Depreciation and Amortization Expense | $ | 4,377 | $ | 4,360 | $ | 4,390 | $ | 4,398 | $ | 17,525 | $ | 4,397 | $ | 4,433 | $ | 4,445 | $ | 4,472 | $ | 17,747 | $ | 4,435 | $ | 4,433 | |||||||||||||||||
Depreciation and Amortization Expense from Continuing Operations Growth Rate Y/Y | -21.7 | % | -21.7 | % | -20.6 | % | -19.0 | % | -20.7 | % | -0.1 | % | 0.5 | % | |||||||||||||||||||||||||||
Adjusted Depreciation and Amortization Expense from Continuing Operations Growth Rate Y/Y | -8.6 | % | -7.9 | % | -7.2 | % | -5.7 | % | -7.3 | % | 1.2 | % | 0.7 | % | |||||||||||||||||||||||||||
Standalone AT&T Adjusted Depreciation and Amortization Expense Growth Rate Y/Y | 0.5 | % | 1.7 | % | 1.3 | % | 1.7 | % | 1.3 | % | 0.9 | % | 0.0 | % | |||||||||||||||||||||||||||
3
Operating Income | 3/31/20 | 6/30/20 | 9/30/20 | 12/31/20 | 2020 | 3/31/21 | 6/30/21 | 9/30/21 | 12/31/21 | 2021 | 3/31/22 | 6/30/22 | |||||||||||||||||||||||||||||
Operating Income from Continuing Operations | $ | 7,283 | $ | 5,561 | $ | 6,064 | $ | (10,536) | $ | 8,372 | $ | 7,194 | $ | 7,572 | $ | 6,237 | $ | 4,894 | $ | 25,897 | $ | 5,537 | $ | 4,956 | |||||||||||||||||
[I] | Non-GAAP Adjustments | 193 | 1,732 | 807 | 16,384 | 19,116 | 86 | (42) | 137 | 114 | 295 | 218 | 941 | ||||||||||||||||||||||||||||
Adjusted Operating Income from Continuing Operations | 7,476 | 7,293 | 6,871 | 5,848 | 27,488 | 7,280 | 7,530 | 6,374 | 5,008 | 26,192 | 5,755 | 5,897 | |||||||||||||||||||||||||||||
Less: Video | (796) | (619) | (570) | (189) | (2,174) | (901) | (1,216) | (374) | — | (2,491) | — | — | |||||||||||||||||||||||||||||
Less: Other dispositions (Held-for-sale) | (93) | (97) | (106) | (63) | (359) | (37) | (43) | (17) | — | (97) | — | — | |||||||||||||||||||||||||||||
Less: Intercompany eliminations | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Less: Reclassification of allocations for separated businesses | (76) | (86) | (76) | (84) | (322) | (15) | (19) | (16) | 4 | (46) | — | — | |||||||||||||||||||||||||||||
Add: DTV-related retained costs | (530) | (530) | (530) | (530) | (2,120) | (530) | (530) | (177) | — | (1,237) | — | — | |||||||||||||||||||||||||||||
Standalone AT&T Adjusted Operating Income | $ | 5,981 | $ | 5,961 | $ | 5,589 | $ | 4,982 | $ | 22,513 | $ | 5,797 | $ | 5,722 | $ | 5,790 | $ | 5,012 | $ | 22,321 | $ | 5,755 | $ | 5,897 | |||||||||||||||||
Operating Income from Continuing Operations Growth Rate Y/Y | -1.2 | % | 36.2 | % | 2.9 | % | 146.5 | % | 209.3 | % | -23.0 | % | -34.5 | % | |||||||||||||||||||||||||||
Adjusted Operating Income Growth Rate Y/Y | -2.6 | % | 3.2 | % | -7.2 | % | -14.4 | % | -4.7 | % | -20.9 | % | -21.7 | % | |||||||||||||||||||||||||||
Standalone AT&T Adjusted Operating Income Growth Rate Y/Y | -3.1 | % | -4.0 | % | 3.6 | % | 0.6 | % | -0.9 | % | -0.7 | % | 3.1 | % | |||||||||||||||||||||||||||
Operating Income Margin from Continuing Operations | 20.6 | % | 16.1 | % | 17.1 | % | -27.9 | % | 5.9 | % | 20.1 | % | 21.2 | % | 19.9 | % | 15.7 | % | 19.3 | % | 18.6 | % | 16.7 | % | |||||||||||||||||
Adjusted Operating Income Margin | 21.1 | % | 21.1 | % | 19.4 | % | 15.5 | % | 19.2 | % | 20.3 | % | 21.1 | % | 20.3 | % | 16.1 | % | 19.5 | % | 19.4 | % | 19.9 | % | |||||||||||||||||
Standalone AT&T Adjusted Operating Income Margin | 21.6 | % | 21.9 | % | 19.9 | % | 16.4 | % | 19.9 | % | 20.0 | % | 19.7 | % | 19.9 | % | 16.1 | % | 18.9 | % | 19.4 | % | 19.9 | % | |||||||||||||||||
4
Other Income (Expense) | 3/31/20 | 6/30/20 | 9/30/20 | 12/31/20 | 2020 | 3/31/21 | 6/30/21 | 9/30/21 | 12/31/21 | 2021 | 3/31/22 | 6/30/22 | |||||||||||||||||||||||||||||
Interest expense | $ | (1,963) | $ | (1,990) | $ | (1,923) | $ | (1,851) | $ | (7,727) | $ | (1,823) | $ | (1,640) | $ | (1,627) | $ | (1,626) | $ | (6,716) | $ | (1,626) | $ | (1,502) | |||||||||||||||||
Equity in net income (loss) of affiliates | — | 10 | 29 | 50 | 89 | (6) | (18) | 183 | 444 | 603 | 521 | 504 | |||||||||||||||||||||||||||||
Other income (expense) - net | 827 | 1,161 | (211) | (2,865) | (1,088) | 4,230 | 1,206 | 1,522 | 2,429 | 9,387 | 2,157 | 2,302 | |||||||||||||||||||||||||||||
Other Income (Expense) from Continuing Operations | (1,136) | (819) | (2,105) | (4,666) | (8,726) | 2,401 | (452) | 78 | 1,247 | 3,274 | 1,052 | 1,304 | |||||||||||||||||||||||||||||
[I] | Non-GAAP Adjustments | 293 | (26) | 1,225 | 3,962 | 5,454 | (2,968) | (16) | 18 | (769) | (3,735) | (545) | (635) | ||||||||||||||||||||||||||||
Adjusted Other Income (Expense) from Continuing Operations | (843) | (845) | (880) | (704) | (3,272) | (567) | (468) | 96 | 478 | (461) | 507 | 669 | |||||||||||||||||||||||||||||
[F] | Less: Estimated interest expense impact of debt redemptions | — | — | — | — | — | 371 | 371 | 371 | 371 | 1,484 | 371 | 371 | ||||||||||||||||||||||||||||
[E] | Add: Estimated equity in net income from DIRECTV investment | 971 | 848 | 789 | 497 | 3,105 | 746 | 955 | 293 | — | 1,994 | — | — | ||||||||||||||||||||||||||||
Standalone AT&T Adjusted Other Income (Expense) | $ | 128 | $ | 3 | $ | (91) | $ | (207) | $ | (167) | $ | 550 | $ | 858 | $ | 760 | $ | 849 | $ | 3,017 | $ | 878 | $ | 1,040 | |||||||||||||||||
5
Income From Continuing Operations | 3/31/20 | 6/30/20 | 9/30/20 | 12/31/20 | 2020 | 3/31/21 | 6/30/21 | 9/30/21 | 12/31/21 | 2021 | 3/31/22 | 6/30/22 | |||||||||||||||||||||||||||||
Income from Continuing Operations | $ | 4,849 | $ | 3,699 | $ | 3,204 | $ | (13,274) | $ | (1,522) | $ | 7,586 | $ | 5,969 | $ | 5,019 | $ | 5,202 | $ | 23,776 | $ | 5,149 | $ | 4,751 | |||||||||||||||||
[I] | Non-GAAP Adjustments | 383 | 1,330 | 1,645 | 17,485 | 20,843 | (2,276) | (307) | 153 | (764) | (3,194) | (224) | 347 | ||||||||||||||||||||||||||||
Adjusted Income from Continuing Operations | 5,232 | 5,029 | 4,849 | 4,211 | 19,321 | 5,310 | 5,662 | 5,172 | 4,438 | 20,582 | 4,925 | 5,098 | |||||||||||||||||||||||||||||
Less: Operating Income of Video and Other dispositions | (1,495) | (1,332) | (1,282) | (866) | (4,975) | (1,483) | (1,808) | (584) | 4 | (3,871) | — | — | |||||||||||||||||||||||||||||
Add: Estimated equity in net income from DIRECTV investment | 971 | 848 | 789 | 497 | 3,105 | 746 | 955 | 293 | — | 1,994 | — | — | |||||||||||||||||||||||||||||
Less: Estimated interest expense impact of debt redemptions | — | — | — | — | — | 371 | 371 | 371 | 371 | 1,484 | 371 | 371 | |||||||||||||||||||||||||||||
[G] | Less: Estimated tax on Video & Other dispositions | (111) | (106) | (94) | (67) | (378) | (73) | (95) | 16 | 75 | (76) | 74 | 74 | ||||||||||||||||||||||||||||
Add: Adjustment of estimated interest expense impact of debt redemptions | — | — | — | — | — | (297) | (297) | (297) | (297) | (1,187) | (297) | (297) | |||||||||||||||||||||||||||||
Standalone AT&T Adjusted Net Income | 4,819 | 4,651 | 4,450 | 3,909 | 17,829 | 4,720 | 4,978 | 4,939 | 4,441 | 19,078 | 4,925 | 5,098 | |||||||||||||||||||||||||||||
Less: Income from Continuing Operations attributable to Noncontrolling Interest | (361) | (384) | (357) | (368) | (1,470) | (394) | (387) | (356) | (348) | (1,485) | (354) | (380) | |||||||||||||||||||||||||||||
Less: Preferred Stock Dividends | (32) | (52) | (54) | (55) | (193) | (50) | (56) | (50) | (51) | (207) | (48) | (52) | |||||||||||||||||||||||||||||
Adjusted Standalone AT&T Income Attributable to Common Stock | $ | 4,426 | $ | 4,215 | $ | 4,039 | $ | 3,486 | $ | 16,166 | $ | 4,276 | $ | 4,535 | $ | 4,533 | $ | 4,042 | $ | 17,386 | $ | 4,523 | $ | 4,666 | |||||||||||||||||
Earnings from Continuing Operations per share of common stock:1 | |||||||||||||||||||||||||||||||||||||||||
Basic | $ | 0.62 | $ | 0.46 | $ | 0.39 | $ | (1.92) | $ | (0.45) | $ | 0.99 | $ | 0.77 | $ | 0.64 | $ | 0.67 | $ | 3.07 | $ | 0.66 | $ | 0.60 | |||||||||||||||||
Diluted | $ | 0.62 | $ | 0.46 | $ | 0.39 | $ | (1.92) | $ | (0.45) | $ | 0.97 | $ | 0.76 | $ | 0.63 | $ | 0.66 | $ | 3.02 | $ | 0.65 | $ | 0.59 | |||||||||||||||||
[J] | Continuing Operations Adjusted Diluted | $ | 0.68 | $ | 0.73 | $ | 0.66 | $ | 0.56 | $ | 2.63 | $ | 0.63 | $ | 0.65 | ||||||||||||||||||||||||||
[J] | Standalone AT&T Adjusted Diluted | $ | 0.61 | $ | 0.58 | $ | 0.56 | $ | 0.50 | $ | 2.25 | $ | 0.58 | $ | 0.64 | $ | 0.62 | $ | 0.56 | $ | 2.41 | $ | 0.63 | $ | 0.65 | ||||||||||||||||
Weighted Average Common Shares Outstanding | 7,187 | 7,145 | 7,147 | 7,150 | 7,157 | 7,161 | 7,168 | 7,171 | 7,172 | 7,168 | 7,184 | 7,169 | |||||||||||||||||||||||||||||
Weighted Average Common Shares Outstanding with Dilution under ASU 2020-06 | 7,455 | 7,463 | 7,465 | 7,480 | 7,466 | 7,482 | 7,484 | 7,506 | 7,541 | 7,503 | 7,555 | 7,611 | |||||||||||||||||||||||||||||
Weighted Average Common Shares Outstanding with Dilution under historical | 7,214 | 7,170 | 7,173 | 7,176 | 7,183 | 7,188 | 7,200 | 7,202 | 7,204 | 7,199 | 7,217 | 7,212 | |||||||||||||||||||||||||||||
1 Earnings per share from continuing operations is calculated using Income from Continuing Operations, less Income from Continuing Operations Attributable to Noncontrolling Interest and Preferred Stock Dividends divided by the weighted average common shares outstanding for the period. |
6
EBITDA2 | 3/31/20 | 6/30/20 | 9/30/20 | 12/31/20 | 2020 | 3/31/21 | 6/30/21 | 9/30/21 | 12/31/21 | 2021 | 3/31/22 | 6/30/22 | |||||||||||||||||||||||||||||
Net Income from Continuing Operations | $ | 4,849 | $ | 3,699 | $ | 3,204 | $ | (13,274) | $ | (1,522) | $ | 7,586 | $ | 5,969 | $ | 5,019 | $ | 5,202 | $ | 23,776 | $ | 5,149 | $ | 4,751 | |||||||||||||||||
Additions: | |||||||||||||||||||||||||||||||||||||||||
Income Tax Expense (Benefit) | 1,298 | 1,043 | 755 | (1,928) | 1,168 | 2,009 | 1,151 | 1,296 | 939 | 5,395 | 1,440 | 1,509 | |||||||||||||||||||||||||||||
Interest Expense | 1,963 | 1,990 | 1,923 | 1,851 | 7,727 | 1,823 | 1,640 | 1,627 | 1,626 | 6,716 | 1,626 | 1,502 | |||||||||||||||||||||||||||||
Equity in Net Income (Loss) of Affiliates | — | (10) | (29) | (50) | (89) | 6 | 18 | (183) | (444) | (603) | (521) | (504) | |||||||||||||||||||||||||||||
Other (Income) Expense - net | (827) | (1,161) | 211 | 2,865 | 1,088 | (4,230) | (1,206) | (1,522) | (2,429) | (9,387) | (2,157) | (2,302) | |||||||||||||||||||||||||||||
Depreciation and amortization | 5,705 | 5,655 | 5,610 | 5,553 | 22,523 | 4,466 | 4,429 | 4,457 | 4,500 | 17,852 | 4,462 | 4,450 | |||||||||||||||||||||||||||||
EBITDA | 12,988 | 11,216 | 11,674 | (4,983) | 30,895 | 11,660 | 12,001 | 10,694 | 9,394 | 43,749 | 9,999 | 9,406 | |||||||||||||||||||||||||||||
Non-GAAP Adjustments | (720) | 854 | (32) | 15,573 | 15,675 | 1 | (70) | 109 | 86 | 126 | 191 | 924 | |||||||||||||||||||||||||||||
Adjusted EBITDA | 12,268 | 12,070 | 11,642 | 10,590 | 46,570 | 11,661 | 11,931 | 10,803 | 9,480 | 43,875 | 10,190 | 10,330 | |||||||||||||||||||||||||||||
Less: Video | (1,387) | (1,212) | (1,127) | (710) | (4,436) | (1,065) | (1,364) | (418) | — | (2,847) | — | — | |||||||||||||||||||||||||||||
Less: Other dispositions (Held-for-sale) | (97) | (101) | (110) | (66) | (374) | (37) | (43) | (17) | — | (97) | — | — | |||||||||||||||||||||||||||||
Less: Intercompany eliminations | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Less: Reclassification of allocations for separated businesses | (76) | (86) | (76) | (84) | (322) | (15) | (19) | (16) | 4 | (46) | — | — | |||||||||||||||||||||||||||||
Add: DTV-related retained costs | (350) | (350) | (350) | (350) | (1,400) | (350) | (350) | (117) | — | (817) | — | — | |||||||||||||||||||||||||||||
Standalone AT&T Adjusted EBITDA | $ | 10,358 | $ | 10,321 | $ | 9,979 | $ | 9,380 | $ | 40,038 | $ | 10,194 | $ | 10,155 | $ | 10,235 | $ | 9,484 | $ | 40,068 | $ | 10,190 | $ | 10,330 | |||||||||||||||||
Adjusted EBITDA Growth Rate Y/Y | -4.9 | % | -1.2 | % | -7.2 | % | -10.5 | % | -5.8 | % | -12.6 | % | -13.4 | % | |||||||||||||||||||||||||||
Standalone AT&T Adjusted EBITDA Growth Rate Y/Y | -1.6 | % | -1.6 | % | 2.6 | % | 1.1 | % | 0.1 | % | 0.0 | % | 1.7 | % | |||||||||||||||||||||||||||
Adjusted EBITDA Margin | 34.7 | % | 35.0 | % | 32.9 | % | 28.0 | % | 32.6 | % | 32.5 | % | 33.4 | % | 34.5 | % | 30.5 | % | 32.7 | % | 34.3 | % | 34.8 | % | |||||||||||||||||
Standalone AT&T Adjusted EBITDA Margin | 37.5 | % | 38.0 | % | 35.6 | % | 30.8 | % | 35.3 | % | 35.2 | % | 35.0 | % | 35.1 | % | 30.5 | % | 33.9 | % | 34.3 | % | 34.8 | % | |||||||||||||||||
2 EBITDA is operating income before depreciation and amortization. It excludes depreciation and amortization, interest expense, other income (expense) - net and income taxes from net income. | |||||||||||||||||||||||||||||||||||||||||
7
Free Cash Flow ($B)3 | 3/31/21 | 6/30/21 | 9/30/21 | 12/31/21 | 2021 | 3/31/22 | 6/30/22 | ||||||||||||||||||||||||||||||||||
Net cash provided by operating activities from Continuing Operations | $ | 9.6 | $ | 10.2 | $ | 9.3 | $ | 8.1 | $ | 37.2 | $ | 7.6 | $ | 7.7 | |||||||||||||||||||||||||||
Add: Distributions from DIRECTV classified as investing activities | — | — | — | 1.3 | 1.3 | 1.3 | 0.3 | ||||||||||||||||||||||||||||||||||
Less: Capital expenditures | (3.9) | (3.7) | (4.5) | (3.5) | (15.6) | (4.6) | (4.9) | ||||||||||||||||||||||||||||||||||
Less: Cash paid vendor financing | (1.7) | (1.3) | (1.0) | (0.6) | (4.6) | (1.6) | (1.8) | ||||||||||||||||||||||||||||||||||
Free Cash Flow from Continuing Operations | 4.0 | 5.2 | 3.8 | 5.3 | 18.3 | 2.8 | 1.4 | ||||||||||||||||||||||||||||||||||
[E] | Add: Estimated equity in net income from DIRECTV investment | — | — | 0.7 | — | 0.7 | — | — | |||||||||||||||||||||||||||||||||
Standalone AT&T Free Cash Flow | $ | 4.0 | $ | 5.2 | $ | 4.5 | $ | 5.3 | $ | 19.0 | $ | 2.8 | $ | 1.4 | |||||||||||||||||||||||||||
3 May not foot due to rounding. Historical presentation may differ due insignificant reclasses between continuing and discontinued operations. | |||||||||||||||||||||||||||||||||||||||||
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NOTES | |||||||||||||||||||||||||||||||||||||||||
[A] | Video business results as reported in AT&T's consolidated financial results; quarters ended 2021 include retained depreciation on assets supporting U-verse products. | ||||||||||||||||||||||||||||||||||||||||
[B] | Other dispositions include the held-for-sale businesses, Crunchyroll, Government Solutions and operations in Puerto Rico that do not meet the requirements for presentation in discontinued operations. | ||||||||||||||||||||||||||||||||||||||||
[C] | After the DIRECTV transaction, we expect to retain incurred operations and support costs in the range of ~$500M per quarter and depreciation of network infrastructure that provides both U-verse video and broadband services to customers of ~$150M per quarter, of which approximately 60% will be received from DIRECTV through transition service agreements and commercial arrangements. These estimated net retained costs have been applied to prior periods for comparability. | ||||||||||||||||||||||||||||||||||||||||
[D] | Adjustment to reflect AT&T's first-quarter 2022 reclassification of certain administrative costs borne by AT&T where the business units did not influence decision making. These costs are not expected to continue in standalone AT&T. | ||||||||||||||||||||||||||||||||||||||||
[E] | Estimated equity in net income of affiliates from DIRECTV. Calculated at 70% of Video EBITDA, which excludes the noncash depreciation and amortization of fair value accretion expected to result from DIRECTV’s revaluation of assets and purchase price allocation. | ||||||||||||||||||||||||||||||||||||||||
[F] | Reflects the use of proceeds to pay down approximately $39.0 billion of borrowings and the resulting reduction to interest expense. The estimated impact of interest expense reduction was determined using the weighted-average interest rate of AT&T’s long-term debt portfolio, including credit agreement borrowings and the impact of derivatives, of 3.8%. This adjustment is required for forma financial information prepared in accordance with Article 11 of Regulation S-X. | ||||||||||||||||||||||||||||||||||||||||
[G] | Estimated tax impact of pro forma and other adjustments at AT&T's adjusted effective tax rate. | ||||||||||||||||||||||||||||||||||||||||
[H] | Under GAAP, AT&T removed transactions involving dealing between segments, including advertising arrangements with Video. | ||||||||||||||||||||||||||||||||||||||||
[I] | Non-GAAP Adjustments: | 3/31/20 | 6/30/20 | 9/30/20 | 12/31/20 | 2020 | 3/31/21 | 6/30/21 | 9/30/21 | 12/31/21 | 2021 | 3/31/22 | 6/30/22 | ||||||||||||||||||||||||||||
Transaction and other costs | $ | 23 | $ | 35 | $ | 29 | $ | 25 | $ | 112 | $ | 35 | $ | — | $ | 8 | $ | (3) | $ | 40 | $ | 98 | $ | 185 | |||||||||||||||||
Employee separation costs and benefit-related (gain) loss | 129 | 748 | (61) | (37) | 779 | (34) | (70) | (3) | (20) | (127) | 93 | 108 | |||||||||||||||||||||||||||||
Asset impairments and abandonments and restructuring | 28 | 71 | — | 15,585 | 15,684 | — | — | 104 | 109 | 213 | — | 631 | |||||||||||||||||||||||||||||
Gain on spectrum transaction | (900) | — | — | — | (900) | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Adjustments to Operations and Support Expenses/ EBITDA | (720) | 854 | (32) | 15,573 | 15,675 | 1 | (70) | 109 | 86 | 126 | 191 | 924 | |||||||||||||||||||||||||||||
Amortization of intangible assets | 913 | 878 | 839 | 797 | 3,427 | 85 | 28 | 28 | 28 | 169 | 27 | 17 | |||||||||||||||||||||||||||||
Impairments | — | — | — | 14 | 14 | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Adjustments to Operating Income | 193 | 1,732 | 807 | 16,384 | 19,116 | 86 | (42) | 137 | 114 | 295 | 218 | 941 | |||||||||||||||||||||||||||||
Other income (expense) net | 293 | (26) | 1,225 | 3,962 | 5,454 | (2,968) | (16) | 18 | (769) | (3,735) | (545) | (635) | |||||||||||||||||||||||||||||
Tax impact of adjustments and discrete items | (103) | (376) | (387) | (2,861) | (3,727) | 606 | (249) | (2) | (109) | 246 | 103 | 41 | |||||||||||||||||||||||||||||
Adjustments to Net Income | $ | 383 | $ | 1,330 | $ | 1,645 | $ | 17,485 | $ | 20,843 | $ | (2,276) | $ | (307) | $ | 153 | $ | (764) | $ | (3,194) | $ | (224) | $ | 347 | |||||||||||||||||
[J] | As of January 1, 2022, we adopted, through retrospective application, Accounting Standards Update (ASU) No. 2020-06, which requires that instruments which may be settled in cash or stock to be presumed settled in stock in calculating diluted EPS. While our intent is to settle the Mobility II preferred interests in cash, the ability to settle this instrument in AT&T shares will result in additional dilutive impact, the magnitude of which is influenced by the fair value of the Mobility II preferred interests and the average AT&T common stock price during the reporting period, which could vary from period-to-period. For these reasons, we have excluded the impact of ASU 2020-06 from our adjusted EPS calculation. |
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