UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of report (Date of earliest event reported) July 21, 2016
AT&T INC.
(Exact Name of Registrant as Specified in Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
1-8610
(Commission File Number)
43-1301883
(IRS Employer Identification No.)
208 S. Akard St., Dallas, Texas
75202
(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code (210) 821-4105
__________________________________
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240-14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 8.01 Other Events.
Throughout this document, AT&T Inc. is referred to as "we" or "AT&T." We are a holding company whose subsidiaries and affiliates operate in the communications
and digital entertainment services industry. Our subsidiaries and affiliates provide services and equipment that deliver wireless, video and broadband services both
domestically and internationally, as well as traditional telephony services.
Overview
We announced on July 21, 2016, that second-quarter 2016 net income attributable to AT&T totaled $3.4 billion, or $0.55 per diluted share, compared to $3.1 billion, or
$0.59 per diluted share in the second quarter of 2015.
Second-quarter 2016 revenues were $40.5 billion, up 22.7 percent from the second-quarter 2015. Second quarter revenues reflect increased revenues primarily from
our acquisition of DIRECTV. Compared with results for the second quarter of 2015, operating expenses were $34.0 billion versus $27.2 billion; operating income was
$6.6 billion, up from $5.8 billion; and AT&T's operating income margin was 16.2 percent, compared to 17.5 percent. Second-quarter 2016 cash from operating activities
was $10.3 billion, up from $9.2 billion in the year-ago quarter primarily due to the acquisition of DIRECTV and the timing of working capital payments.
Many of our products, including AT&T Mobility and AT&T U-verse® (U-verse), are offered to subscribers in multiple segments. Accordingly, to aid in understanding
subscriber trends, we are presenting an overall discussion of these customer metrics. We reported a net gain of 2.1 million North American wireless subscribers in the
second quarter of 2016, of which 1.4 million were in the U.S. At June 30, 2016, our North American wireless customer base was approximately 141.8 million
compared to 132.5 million in the prior year, and our domestic wireless subscribers totaled 131.8 million compared to 123.9 million. During the second quarter, net adds
were as follows:
ö North American branded net adds (combined postpaid and prepaid) were 1.4 million, of which 622,000 were domestic. North American prepaid subscriber net
adds were 979,000, of which 365,000 were domestic. North American postpaid subscriber net adds were 422,000, of which 257,000 were domestic. Total
domestic postpaid tablet and computing device net adds were 319,000.
ö Connected devices were 1.2 million; 1.3 million attributable to connected cars.
ö North American reseller had a net loss of 496,000, with 459,000 in the U.S. primarily attributable to the year-end 2016 shutdown of our 2G U.S. network.
We no longer offer subsidized device purchases for the majority of our U.S. customers, instead allowing subscribers to purchase devices on installment (AT&T Next)
or to bring their own device (BYOD). During the first quarter of 2016, we also introduced an integrated offer that allows for unlimited wireless data when combined
with our video services, ending the second quarter with more than 5.0 million subscribers to this offer. At June 30, 2016, Mobile Share plans represented nearly 58.2
million domestic wireless connections and about 75 percent of our domestic wireless postpaid smartphone base was on no-device-subsidy Mobile Share plans.
Sales under our equipment installment programs, including AT&T Next continued to increase during the second quarter, with 83 percent of all postpaid smartphone
gross adds and upgrades selecting these programs, compared to nearly 80 percent in the first quarter of 2016 and 68 percent in the second quarter of 2015. During the
second quarter of 2016, we sold 4.0 million smartphones under our AT&T Next program and had BYOD gross adds of 477,000. About 93 percent of smartphone
transactions in the quarter were no-subsidy compared to 74 percent in the year-ago quarter. At June 30, 2016, about 50 percent of the postpaid smartphone base is on
AT&T Next compared to nearly 37 percent at June 30, 2015.
With our July 24, 2015, acquisition of DIRECTV, we added 32.2 million subscribers of DIRECTV's video services, which includes domestic and international
subscribers and reflects our methodology used to count commercial subscribers. At June 30, 2016, we had 37.8 million video subscribers compared with 6.0 million at
June 30, 2015. Total video subscribers increased by 38,000 in the second quarter of 2016.
Our total broadband connections were 15.6 million at June 30, 2016, and 16.0 million at June 30, 2015. During the second quarter, we added 74,000 IP broadband
subscribers, for a total of 13.5 million at June 30, 2016. Total broadband subscribers declined by 123,000 in the quarter.
At June 30, 2016, our total switched access lines were 15.3 million compared with 18.1 million at June 30, 2015. The number of U-verse voice connections (which use
VoIP technology and therefore are not included in the access line total) increased by 109,000 in the quarter to reach 5.6 million at June 30, 2016, compared to 5.4 million
at June 30, 2015.
Segment Summary
Business Solutions
Revenues from our Business Solutions (ABS) segment for the second quarter of 2016 were $17.6 billion, down 0.5 percent versus the year-ago quarter primarily due to
continued declines in our legacy voice and data products, lower equipment revenues and foreign exchange pressures. These revenue declines were mostly offset by
growth in strategic business services and higher wireless service revenues, largely due to migrations from our Consumer Mobility segment. Second-quarter 2016 ABS
operating expenses totaled $13.4 billion, down 0.4 percent versus the second quarter of 2015. The ABS operating margin was 23.9 percent, compared to 24.0 percent in
the year-earlier quarter with wireless and IP revenue growth and cost efficiencies mostly offsetting declines in legacy services.
We had approximately 77.5 million business wireless subscribers at June 30, 2016, compared to 69.2 million at June 30, 2015. During the second quarter of 2016,
business wireless net adds for connected devices were 1.2 million and postpaid net adds were 185,000. Postpaid business wireless subscriber churn was 0.91 percent,
compared to 0.91 percent in the year-ago quarter.
During the second quarter of 2016, we added 20,000 high-speed Internet business subscribers, bringing total business IP broadband to 948,000 subscribers. Total
business broadband connections had a loss of 14,000 subscribers in the quarter.
Entertainment Group
Our Entertainment Group (Entertainment) segment includes the results of the U.S. satellite-based operations acquired in our July 2015 acquisition of DIRECTV as well
as broadband and wired voice services to domestic residential customers. Entertainment revenues for the second quarter of 2016 were $12.7 billion, more than double
the year-ago quarter due to the acquisition of DIRECTV as well as strong growth in consumer IP broadband. Revenues from legacy voice and data products continue
to decline. Second-quarter 2016 Entertainment operating expenses totaled $11.1 billion compared to $6.0 billion in the second quarter of 2015, largely due to the
acquisition of DIRECTV. The Entertainment operating margin was 13.0 percent, compared to (3.4) percent in the year-earlier quarter with satellite video and IP
revenue growth and cost efficiencies offsetting programming content cost pressure and declines in legacy services.
At June 30, 2016, Entertainment had approximately 51.3 million revenue connections, compared to 33.7 million at June 30, 2015, which included:
ö Approximately 25.3 million video connections at June 30, 2016, compared to 6.0 million at June 30, 2015. DIRECTV's satellite subscribers as of the July 24,
2015, acquisition date were 19.5 million. During the second quarter of 2016, we added 342,000 satellite subscribers despite some seasonality pressures;
however, U-verse subscribers declined 391,000 as we focused on profitability and increasingly emphasized satellite sales, including U-verse subscribers
choosing to switch to satellite. At June 30, 2016, more than 80 percent of our domestic video subscribers are on the DIRECTV platform.
ö Approximately 14.2 million broadband connections at June 30, 2016, compared to 14.4 million at June 30, 2015. During the second quarter, we added 54,000 IP
broadband subscribers, for a total of 12.6 million at June 30, 2016. Total broadband subscribers declined 110,000 in the quarter.
ö Approximately 11.8 million wired voice connections at June 30, 2016, compared to 13.3 million at June 30, 2015. Voice connections include switched access
lines and VoIP connections.
Consumer Mobility
Revenues from our Consumer Mobility segment, which consist of consumer, wholesale and resale subscribers located in the U.S., for the second quarter of 2016 were
$8.2 billion, down 6.5 percent versus the year-ago quarter, reflecting a $627 million decline in postpaid service revenues due to the popularity of Mobile Share plans,
migrations of customers to our ABS segment and lower equipment revenues, reflecting lower smartphone upgrade volumes and an increase in BYOD. This decline was
partially offset by an increase of $249 million in prepaid service revenues. Second-quarter 2016 Consumer Mobility operating expenses totaled $5.6 billion, down 8.5
percent versus the second quarter of 2015 reflecting lower equipment and commission costs as well as increased efficiencies. The Consumer Mobility operating margin
was 31.4 percent, compared to 29.9 percent in the year-earlier quarter with lower volumes, fewer subsidized sales and cost efficiencies more than offsetting the
pressure from customers choosing our lower service rate Mobile Share plans.
We had approximately 54.3 million Consumer Mobility subscribers at June 30, 2016, compared to 54.7 million at June 30, 2015. During the second quarter of 2016, we
had branded net adds of 437,000, (prepaid net adds were 365,000 reflecting gains in both Cricket and GoPhone subscribers, and consumer postpaid net adds were
72,000). Consumer reseller had a net loss of 446,000. Our business wireless offerings allow for individual subscribers to purchase wireless services through employersponsored plans for a reduced price. The migration of these subscribers to the ABS segment negatively impacted Consumer postpaid subscriber and service revenues
growth.
Total customer churn of Consumer Mobility subscribers was 1.96 percent versus 1.86 percent in the second quarter of 2015, including postpaid churn of 1.09 percent,
compared to 1.16 percent in the year-ago quarter.
International
Our International segment consists of the Latin American operations acquired in our July 2015 acquisition of DIRECTV as well as the Mexican wireless operations
acquired earlier in 2015. Second quarter 2016 operating revenues were $1.8 billion, with $1.2 billion attributable to video services in Latin America and $606 million of
wireless revenues in Mexico. Second quarter 2015 operating revenues included the results of our Mexican wireless companies and were $491 million. Our international
segment revenues reflect foreign exchange pressures in our DIRECTV Latin America and Mexican wireless results. Operating expenses were $2.0 billion compared to
$622 million in the second quarter of 2015, largely due to our acquisition of DIRECTV. The International operating margin was (10.6) percent, compared to (26.7)
percent in the year-earlier quarter.
At June 30, 2016, we had approximately 10.0 million wireless subscribers in Mexico and 12.5 million video connections in Latin America, including 5.3 million in Brazil.
During the second quarter of 2016, our Mexico wireless business had net adds of 742,000 subscribers and our Latin America operations had net adds of 87,000 video
connections.
Supplemental Discussion
As a supplemental discussion of our operating results, for comparison purposes, we are providing a view of our combined AT&T Mobility operations (domestic only).
AT&T Mobility revenues for the second quarter of 2016 were $17.9 billion, down 2.1 percent versus the second quarter of 2015, and AT&T Mobility's operating
income margin was 29.8 percent compared to 29.0 percent in the year-ago quarter reflecting continuing adoption of AT&T Next, an increase in BYOD customers,
lower smartphone upgrade volumes and continued efforts to drive operating costs out of the business.
For the quarter ended June 30, 2016, postpaid phone-only ARPU decreased 2.4 percent versus the year-earlier quarter and increased 0.5 percent sequentially. Postpaid
phone-only ARPU plus AT&T Next increased 2.5 percent versus the year earlier quarter and 0.6 percent sequentially.
Postpaid churn was 0.97 percent, compared to 1.01 percent in the year-ago. Total customer churn was 1.35 percent versus 1.31 percent in the second quarter of 2015.
Repurchases of our common stock under our previously announced share repurchase authorization by our Board of Directors totaled 5 million shares, or $197 million
during the second quarter of 2016. At June 30, 2016, about 402 million shares remain available under approved share repurchase authorizations.
CAUTIONARY LANGUAGE CONCERNING FORWARD-LOOKING STATEMENTS
Information set forth in this filing contains financial estimates and other forward-looking statements that are subject to risks and uncertainties. A discussion of factors
that may affect future results is contained in AT&T's filings with the Securities and Exchange Commission. AT&T disclaims any obligation to update or revise
statements contained in this filing based on new information or otherwise.
Item 9.01 Financial Statements and Exhibits.
The following exhibits are filed as part of this report:
(d) Exhibits
99.1 AT&T Inc. selected financial statements and operating data.
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
AT&T INC.
Date: July 21, 2016
By: /s/ Debra L. Dial
Debra L. Dial
Senior Vice President and Controller
Financial Data
AT&T Inc.
Consolidated Statements of Income
Dollars in millions except per share amounts
Unaudited
Operating Revenues
Service
Equipment
Total Operating Revenues
Operating Expenses
Cost of services and sales
Equipment
Broadcast, programming and operations
Other cost of services (exclusive of depreciation
and amortization shown separately below)
Selling, general and administrative
Depreciation and amortization
Total Operating Expenses
Operating Income
Interest Expense
Equity in Net Income of Affiliates
Other Income (Expense) - Net
Income Before Income Taxes
Income Tax Expense
Net Income
Less: Net Income Attributable to Noncontrolling Interest
Net Income Attributable to AT&T
Three Months Ended
6/30/2016
6/30/2015
$
$
Basic Earnings Per Share Attributable to AT&T
Weighted Average Common
Shares Outstanding (000,000)
$
Diluted Earnings Per Share Attributable to AT&T
Weighted Average Common
Shares Outstanding with Dilution (000,000)
$
37,142
3,378
40,520
$
29,541
3,474
33,015
4,260
4,701
4,353
1,148
9,514
8,909
6,576
33,960
6,560
1,258
28
91
5,421
1,906
3,515
(107)
3,408
9,578
7,467
4,696
27,242
5,773
932
33
48
4,922
1,738
3,184
(102)
3,082
0.55
$
$
6,174
0.55
6,195
0.59
5,204
$
0.59
5,220
% Chg
25.7% $
-2.8%
22.7%
-2.1%
-0.7%
19.3%
40.0%
24.7%
13.6%
35.0%
-15.2%
89.6%
10.1%
9.7%
10.4%
-4.9%
10.6% $
-6.8% $
18.6%
-6.8% $
18.7%
Six Months Ended
6/30/2016
6/30/2015
74,243
6,812
81,055
58,503
7,088
65,591
26.9%
-3.9%
23.6%
8,635
9,330
8,899
2,270
-3.0%
-
18,910
17,350
13,139
67,364
13,691
2,465
41
161
11,428
4,028
7,400
(189)
7,211
18,390
15,428
9,274
54,261
11,330
1,831
33
118
9,650
3,127
6,523
(178)
6,345
2.8%
12.5%
41.7%
24.1%
20.8%
34.6%
24.2%
36.4%
18.4%
28.8%
13.4%
-6.2%
1.17
$
% Chg
$
$
6,173
1.17
6,193
$
13.6%
1.22
-4.1%
5,204
18.6%
1.22
-4.1%
5,220
18.6%
Financial Data
AT&T Inc.
Statements of Segment Income
Dollars in millions
Unaudited
Three Months Ended
6/30/2016
6/30/2015
% Chg
Six Months Ended
6/30/2016
6/30/2015
% Chg
Business Solutions
Segment Operating Revenues
Wireless service
Fixed strategic services
Legacy voice and data services
Other service and equipment
Wireless equipment
Total Segment Operating Revenues
Segment Operating Expenses
Operations and support expenses
Depreciation and amortization
Total Segment Operating Expenses
Segment Operating Income
Equity in Net Income of Affiliates
Segment Contribution
$
$
Segment Operating Income Margin
7,963
2,797
4,158
886
1,775
17,579
10,857
2,521
13,378
4,201
4,201
$
$
23.9%
7,756
2,580
4,681
854
1,793
17,664
2.7% $
8.4%
-11.2%
3.7%
-1.0%
-0.5%
15,818
5,559
8,521
1,744
3,546
35,188
10,972
2,460
13,432
4,232
4,232
-1.0%
2.5%
-0.4%
-0.7%
-0.7% $
21,659
5,029
26,688
8,500
8,500
$
$
24.2%
24.0%
15,271
5,099
9,465
1,700
3,686
35,221
3.6%
9.0%
-10.0%
2.6%
-3.8%
-0.1%
22,045
4,802
26,847
8,374
8,374
-1.8%
4.7%
-0.6%
1.5%
1.5%
23.8%
Entertainment Group
Segment Operating Revenues
Video entertainment
High-speed internet
Legacy voice and data services
Other service and equipment
Total Segment Operating Revenues
Segment Operating Expenses
Operations and support expenses
Depreciation and amortization
Total Segment Operating Expenses
Segment Operating Income (Loss)
Equity in Net Income (Loss) of Affiliates
Segment Contribution
Segment Operating Income Margin
$
$
8,963
1,867
1,244
637
12,711
9,569
1,489
11,058
1,653
(2)
1,651
13.0%
$
$
1,991
1,623
1,516
652
5,782
- $
15.0%
-17.9%
-2.3%
-
17,867
3,670
2,557
1,275
25,369
4,913
1,065
5,978
(196)
(12)
(208)
94.8%
39.8%
85.0%
83.3%
- $
19,147
2,977
22,124
3,245
1
3,246
-3.4%
12.8%
$
$
3,862
3,176
3,128
1,276
11,442
15.6%
-18.3%
-0.1%
-
9,772
2,130
11,902
(460)
(18)
(478)
95.9%
39.8%
85.9%
-
-4.0%
Financial Data
AT&T Inc.
Statements of Segment Income
Dollars in millions
Unaudited
Three Months Ended
6/30/2016
6/30/2015
% Chg
6/30/2016
Six Months Ended
6/30/2015
% Chg
Consumer Mobility
Segment Operating Revenues
Service
Equipment
Total Segment Operating Revenues
Segment Operating Expenses
Operations and support expenses
Depreciation and amortization
Total Segment Operating Expenses
Segment Operating Income
Equity in Net Income of Affiliates
Segment Contribution
$
$
Segment Operating Income Margin
6,948
1,238
8,186
4,680
932
5,612
2,574
2,574
$
$
31.4%
7,359
1,396
8,755
-5.6% $
-11.3%
-6.5%
13,891
2,623
16,514
5,202
934
6,136
2,619
2,619
-10.0%
-0.2%
-8.5%
-1.7%
-1.7% $
9,592
1,854
11,446
5,068
5,068
$
$
30.7%
29.9%
14,656
2,877
17,533
-5.2%
-8.8%
-5.8%
10,743
1,936
12,679
4,854
4,854
-10.7%
-4.2%
-9.7%
4.4%
4.4%
27.7%
International
Segment Operating Revenues
Video entertainment
Wireless service
Wireless equipment
Total Segment Operating Revenues
Segment Operating Expenses
Operations and support expenses
Depreciation and amortization
Total Segment Operating Expenses
Segment Operating Income (Loss)
Equity in Net Income of Affiliates
Segment Contribution
Segment Operating Income Margin
$
$
1,222
489
117
1,828
1,723
298
2,021
(193)
9
(184)
-10.6%
$
$
444
47
491
- $
10.1%
-
2,352
944
199
3,495
529
93
622
(131)
(131)
-47.3%
-40.5% $
3,311
575
3,886
(391)
23
(368)
-26.7%
-11.2%
$
$
659
68
727
747
121
868
(141)
(141)
-19.4%
43.2%
-
-
Financial Data
AT&T Inc.
Consolidated Balance Sheets
Dollars in millions
6/30/16
Unaudited
12/31/15
Assets
Current Assets
Cash and cash equivalents
Accounts receivable - net of allowances for doubtful accounts of $642 and $704
Prepaid expenses
Other current assets
Total current assets
Property, Plant and Equipment - Net
Goodwill
Licenses
Customer Lists and Relationships - Net
Other Intangible Assets - Net
Investments in Equity Affiliates
Other Assets
Total Assets
$
$
7,208
15,830
1,197
11,770
36,005
123,537
105,252
94,098
16,259
9,107
1,677
15,873
401,808
$
$
5,121
16,532
1,072
13,267
35,992
124,450
104,568
93,093
18,208
9,409
1,606
15,346
402,672
Liabilities and Stockholders' Equity
Current Liabilities
Debt maturing within one year
Accounts payable and accrued liabilities
Advanced billing and customer deposits
Accrued taxes
Dividends payable
Total current liabilities
Long-Term Debt
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes
Postemployment benefit obligation
Other noncurrent liabilities
Total deferred credits and other noncurrent liabilities
Stockholders' Equity
Common stock
Additional paid-in capital
Retained earnings
Treasury stock
Accumulated other comprehensive income
Noncontrolling interest
Total stockholders' equity
Total Liabilities and Stockholders' Equity
$
$
9,528
26,746
4,465
2,773
2,953
46,465
117,308
$
7,636
30,372
4,682
2,176
2,950
47,816
118,515
57,983
34,023
21,425
113,431
56,181
34,262
22,258
112,701
6,495
89,486
34,950
(12,343)
5,047
969
124,604
401,808
6,495
89,763
33,671
(12,592)
5,334
969
123,640
402,672
$
Financial Data
AT&T Inc.
Consolidated Statements of Cash Flows
Dollars in millions
(Unaudited)
Six months ended June 30,
2016
2015
Operating Activities
Net income
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
Undistributed earnings from investments in equity affiliates
Provision for uncollectible accounts
Deferred income tax expense
Net gain from sale of investments, net of impairments
Changes in operating assets and liabilities:
Accounts receivable
Other current assets
Accounts payable and accrued liabilities
Retirement benefit funding
Other - net
Total adjustments
Net Cash Provided by Operating Activities
$
7,400
$
6,523
13,139
(22)
705
1,767
(85)
9,274
(23)
535
1,244
(50)
543
1,069
(3,059)
(280)
(2,970)
10,807
18,207
434
732
(1,125)
(455)
(1,191)
9,375
15,898
(9,702)
(437)
(485)
107
500
(10,017)
(8,328)
(339)
(20,954)
72
1,890
(1)
(27,660)
10,140
(9,129)
(197)
119
(5,899)
(1,137)
(6,103)
2,087
5,121
7,208
33,958
(2,919)
20
(4,873)
(2,071)
24,115
12,353
8,603
20,956
Investing Activities
Capital expenditures:
Purchase of property and equipment
Interest during construction
Acquisitions, net of cash acquired
Dispositions
Sales of securities, net
Other
Net Cash Used in Investing Activities
Financing Activities
Issuance of long-term debt
Repayment of long-term debt
Purchase of treasury stock
Issuance of treasury stock
Dividends paid
Other
Net Cash (Used in) Provided by Financing Activities
Net increase in cash and cash equivalents
Cash and cash equivalents beginning of year
Cash and Cash Equivalents End of Period
$
$
Financial Data
AT&T Inc.
Supplementary Operating and Financial Data
Dollars in millions except per share amounts, subscribers and connections in (000s)
Unaudited
Three Months Ended
6/30/2016
6/30/2015
Business Solutions Wireless Subscribers
Postpaid
Branded Subscribers
Reseller
Connected Devices
Business Solutions Wireless Net Adds
Postpaid
Branded Net Adds
Reseller
Connected Devices
Business Wireless Postpaid Churn
1,371
185
185
(13)
1,199
0.91%
1,769
288
288
3
1,478
0.91%
% Chg
-22.5%
-35.8%
-35.8%
-18.9%
-
Consumer Mobility Subscribers
Postpaid
Prepaid
Branded Subscribers
Reseller
Connected Devices
Consumer Mobility Net Adds
Postpaid
Prepaid
Branded Net Adds
Reseller
Connected Devices
Consumer Mobility Postpaid Churn
Total Consumer Mobility Churn
(10)
72
365
437
(446)
(1)
325
122
331
453
(98)
(30)
1.09%
1.96%
1.16%
1.86%
-41.0%
10.3%
-3.5%
96.7%
-7BP
10BP
Entertainment Group
Video Connections
Satellite
U-verse
Video Net Adds
Satellite
U-verse
(49)
342
(391)
(23)
(23)
-
Broadband Connections
IP
DSL
Broadband Net Adds
IP
DSL
(110)
54
(164)
(107)
217
(324)
-2.8%
-75.1%
49.4%
Total Wireline Voice Connections
AT&T International
Mexican Wireless Subscribers and Connections
Subscribers
Net Adds
Total Churn
742
5.83%
(170)
6.81%
-98BP
Video Subscribers and Connections
Latin America Video Subscribers
Pan Americana
Brazil
Video Subscribers and Connections Net Adds
Latin America Video Subscribers
Pan Americana
Brazil
87
81
6
-
-
Six Months Ended
6/30/2016
6/30/2015
77,545
69,178
49,432
46,697
49,432
46,697
52
19
28,061
22,462
3,060
318
318
(35)
2,777
0.97%
3,093
585
585
6
2,502
0.90%
% Chg
12.1%
5.9%
5.9%
24.9%
-1.1%
-45.6%
-45.6%
11.0%
7BP
54,260
27,862
12,633
40,495
12,869
896
54,724
29,844
10,438
40,282
13,487
955
-0.8%
-6.6%
21.0%
0.5%
-4.6%
-6.2%
82
68
865
933
(824)
(27)
219
266
429
695
(367)
(109)
-62.6%
-74.4%
34.2%
75.2%
1.16%
2.04%
1.18%
1.95%
-2BP
9BP
51,291
25,295
20,454
4,841
33,686
5,946
5,946
(103)
670
(773)
26
26
14,181
12,596
1,585
14,428
12,013
2,415
-1.7%
4.9%
-34.4%
(105)
240
(345)
(14)
630
(644)
-61.9%
46.4%
11,815
13,312
-11.2%
9,955
1,271
5.65%
8,550
(458)
7.36%
52.3%
-18.6%
-
16.4%
-171BP
12,523
7,175
5,348
-
-
14
109
(95)
-
-
Financial Data
AT&T Inc.
Supplementary Operating and Financial Data
Dollars in millions except per share amounts, subscribers and connections in (000s)
Unaudited
Three Months Ended
6/30/2016
6/30/2015
AT&T Total Subscribers and Connections
AT&T Mobility Subscribers
Postpaid
Prepaid
Branded Subscribers
Reseller
Connected Devices
AT&T Mobility Net Adds
Postpaid
Prepaid
Branded Net Adds
Reseller
Connected Devices
M&A Activity, Partitioned Customers and Other Adjs.
1,361
257
365
622
(459)
1,198
(1)
AT&T Mobility Churn
Postpaid Churn
Total Churn
2,094
410
331
741
(95)
1,448
36
0.97%
1.35%
1.01%
1.31%
Six Months Ended
6/30/2016
6/30/2015
% Chg
-35.0%
-37.3%
10.3%
-16.1%
-17.3%
-
-4BP
4BP
Other
Domestic Licensed POPs (000,000)
Total Video Subscribers
Domestic
Pan Americana
Brazil
Total Video Net Adds
Domestic
Pan Americana
Brazil
38
(49)
81
6
(22)
(22)
-
-
Total Broadband Connections
IP
DSL
Broadband Net Adds
IP
DSL
(123)
74
(197)
(136)
241
(377)
9.6%
-69.3%
47.7%
Total Wireline Voice Connections
Total Wireless Subscribers
Domestic Wireless Subscribers
Mexican Wireless Subscribers
Branded Subscribers
Branded Net Adds
1,401
741
89.1%
4,480
216
0.47
17.2%
1.4%
2.1%
% Chg
131,805
77,295
12,633
89,928
12,920
28,957
123,902
76,541
10,438
86,979
13,506
23,417
6.4%
1.0%
21.0%
3.4%
-4.3%
23.7%
3,142
386
865
1,251
(859)
2,750
23
3,312
851
429
1,280
(361)
2,393
36
-5.1%
-54.6%
-2.3%
14.9%
-36.1%
1.04%
1.38%
1.01%
1.36%
3BP
2BP
322
321
37,846
25,323
7,175
5,348
5,971
5,971
-
-
(87)
(101)
109
(95)
28
28
-
-
15,641
13,544
2,097
15,961
12,885
3,076
-2.0%
5.1%
-31.8%
(137)
276
(413)
(67)
680
(747)
-59.4%
44.7%
20,877
23,497
-11.2%
141,760
131,805
9,955
132,452
123,902
8,550
7.0%
6.4%
16.4%
99,557
2,596
95,049
1,280
4.7%
-
8,328
339
0.94
5,193
55.5%
250,730
16.5%
28.9%
2.1%
18.5%
-510BP
10.6%
0.3%
AT&T Inc.
Capital expenditures:
Purchase of property and equipment
Interest during construction
Dividends Declared per Share
End of Period Common Shares Outstanding (000,000)
Debt Ratio1,2
Total Employees
$
$
$
1Prior year amounts restated to conform to current period reporting methodology.
2Total long-term debt plus debt maturing within one year divided by total debt plus total stockholders' equity.
Note: For the end of 2Q16, total switched access lines were 15,285.
Business Solutions and Consumer Mobility may not total to AT&T Mobility due to rounding.
5,251
219
0.48
$
$
$
$
$
$
9,702 $
437 $
0.96 $
6,152
50.4%
277,200
Financial Data
AT&T Inc.
Segment Supplemental - QTD
Dollars in millions
Unaudited
For the three months ended June 30, 2016
Revenues
Business Solutions
Entertainment Group
Consumer Mobility
International
Segment Total
Corporate and Other
Acquisition-related items
Certain Significant items
AT&T Inc.
$
$
17,579
12,711
8,186
1,828
40,304
216
40,520
Operations
and Support
Expenses
$
10,857
9,569
4,680
1,723
26,829
293
233
29
$
27,384
EBITDA
$
$
6,722
3,142
3,506
105
13,475
(77)
(233)
(29)
13,136
Depreciation
and
Amortization
$
2,521
1,489
932
298
5,240
20
1,316
$
6,576
Operating
Income (Loss)
$
$
4,201
1,653
2,574
(193)
8,235
(97)
(1,549)
(29)
6,560
Equity in Net
Segment
Income (Loss) of
Contribution
Affiliates
$
- $
4,201
(2)
1,651
2,574
9
(184)
$
7 $
8,242
For the three months ended June 30, 2015
Revenues
Business Solutions
Entertainment Group
Consumer Mobility
International
Segment Total
Corporate and Other
Acquisition-related items
Certain Significant items
AT&T Inc.
$
$
17,664
5,782
8,755
491
32,692
323
33,015
Operations
and Support
Expenses
$
10,972
4,913
5,202
529
21,616
236
694
$
22,546
EBITDA
$
$
6,692
869
3,553
(38)
11,076
87
(694)
10,469
Depreciation
and
Amortization
$
2,460
1,065
934
93
4,552
24
120
$
4,696
Operating
Income (Loss)
$
$
4,232
(196)
2,619
(131)
6,524
63
(814)
5,773
Equity in Net
Segment
Income (Loss) of
Contribution
Affiliates
$
- $
4,232
(12)
(208)
2,619
(131)
$
(12) $
6,512
Financial Data
AT&T Inc.
Segment Supplemental - YTD
Dollars in millions
Unaudited
For the six months ended June 30, 2016
Revenues
Business Solutions
Entertainment Group
Consumer Mobility
International
Segment Total
Corporate and Other
Acquisition-related items
Certain Significant items
AT&T Inc.
$
$
35,188
25,369
16,514
3,495
80,566
489
81,055
Operations
and Support
Expenses
$
21,659
19,147
9,592
3,311
53,709
670
528
(682)
$
54,225
EBITDA
$
$
13,529
6,222
6,922
184
26,857
(181)
(528)
682
26,830
Depreciation
and
Amortization
$
5,029
2,977
1,854
575
10,435
37
2,667
$
13,139
Operating
Income (Loss)
$
$
8,500
3,245
5,068
(391)
16,422
(218)
(3,195)
682
13,691
Equity in Net
Income of
Affiliates
$
1
23
$
24
Segment
Contribution
$
$
8,500
3,246
5,068
(368)
16,446
For the six months ended June 30, 2015
Revenues
Business Solutions
Entertainment Group
Consumer Mobility
International
Segment Total
Corporate and Other
Acquisition-related items
Certain Significant items
AT&T Inc.
$
$
35,221
11,442
17,533
727
64,923
668
65,591
Operations
and Support
Expenses
$
22,045
9,772
10,743
747
43,307
470
993
217
$
44,987
EBITDA
$
$
13,176
1,670
6,790
(20)
21,616
198
(993)
(217)
20,604
Depreciation
and
Amortization
$
4,802
2,130
1,936
121
8,989
44
241
$
9,274
Operating
Income (Loss)
$
$
8,374
(460)
4,854
(141)
12,627
154
(1,234)
(217)
11,330
Equity in Net
Income (Loss) of
Affiliates
$
(18)
$
(18)
Segment
Contribution
$
$
8,374
(478)
4,854
(141)
12,609
Financial Data
AT&T Inc.
Supplemental AT&T Mobility Results
Dollars in millions
Unaudited
6/30/2016
Three Months Ended
6/30/2015
% Chg
6/30/2016
Six Months Ended
6/30/2015
% Chg
AT&T Mobility
Operating Revenues
Service
Equipment
Total Operating Revenues
Operating Expenses
Operations and support expenses
Depreciation and amortization
Total Operating Expenses
Operating Income
Operating Income Margin
$
$
14,912
3,013
17,925
10,502
2,081
12,583
5,342
29.8%
$
$
15,115
3,189
18,304
-1.3% $
-5.5%
-2.1%
29,710
6,169
35,879
10,973
2,031
13,004
5,300
-4.3%
2.5%
-3.2%
0.8% $
21,126
4,137
25,263
10,616
29.0%
29.6%
$
$
29,927
6,563
36,490
-0.7%
-6.0%
-1.7%
22,445
4,036
26,481
10,009
-5.9%
2.5%
-4.6%
6.1%
27.4%