Continued strong subscriber
growth
-
-
- 656,000 postpaid phone net adds; nearly 2.9 million for the
full year
- 280,000 AT&T Fiber net adds, 12 straight quarters with
more than 200,000 net adds; more than 1.2 million net adds for
full-year 2022, fifth straight year with 1 million or more AT&T
Fiber net adds
Subscriber additions driving revenue
growth
-
-
- Domestic wireless service revenues up 5.2%; 5.1% for the
full year
- Consumer broadband revenues up 7.2% driven by AT&T Fiber
revenue growth of more than 31%; full-year broadband revenues grew
6.4% with AT&T Fiber revenues up nearly 29%
Network deployment on or ahead of
schedule
-
-
- Mid-band 5G spectrum covering 150 million people, more than
two times higher than original end-of-year target
- Ability to serve more than 19 million consumer locations and
more than 3 million business customer locations in more than 100
U.S. metro areas with fiber
Transformation supporting margin
growth
-
-
- Achieved more than $5 billion
of $6 billion-plus run-rate cost
savings target at year end
Fourth-Quarter Consolidated Results
- Revenues from continuing
operations1 of $31.3
billion
- Reported EPS from continuing operations of
($3.20)2 due to
non-cash charges compared to $0.66 in the prior year
- Adjusted EPS* from continuing
operations of $0.61 compared
to $0.56 in the prior year
- Cash from operating activities from continuing
operations of $10.3 billion
- Capital expenditures from continuing
operations of $4.2 billion; capital
investment* from continuing operations of $4.7 billion
- Free cash flow* from continuing
operations of $6.1 billion
Full-Year Consolidated Results
- Revenues from continuing operations of
$120.7 billion
- Reported EPS from continuing operations
of ($1.10)2
due to non-cash charges
- Adjusted EPS* from continuing
operations of $2.57
- Cash from operations of $35.8 billion
- Capital expenditures of $19.6 billion; capital
investment* of $24.3
billion
- Free cash flow* of $14.1 billion
2023 Outlook – Continuing Operations
For the full year AT&T expects:
- Wireless service revenue growth of 4% or higher
- Broadband revenue growth of 5% or higher
- Adjusted EBITDA* growth of 3% or higher
- Capital investment* of about $24 billion, consistent with 2022 levels
- Free cash flow* of $16
billion or better, up $2
billion from 2022
- Adjusted EPS* of $2.35 to $2.45,
which includes an expected ($0.25) of
impacts from higher non-cash pension costs related to higher
interest rates, lower capitalized interest and impacts from an
expected higher effective tax rate of 23% to 24%
Note: AT&T's fourth-quarter earnings conference call will
be webcast at 8:30 a.m. ET on Wednesday,
January 25, 2023. The webcast and related materials,
including financial highlights, will be available on AT&T's
Investor Relations website at
https://investors.att.com.
DALLAS, Jan. 25,
2023 /PRNewswire/ -- AT&T Inc. (NYSE:
T) reported fourth-quarter results that showed sustained momentum
in customer additions across 5G and fiber and solid growth in
wireless service and broadband revenues.
"We're committed to connecting people to greater possibility,
and our results demonstrate that our customers are responding to
this," said John Stankey, AT&T
CEO. "Our consistent go-to-market strategy and the simplicity of
our offerings drove continued robust, high-quality wireless and
fiber customer additions in the fourth quarter. Over the last 10
quarters, we've demonstrated sustainable momentum in growing
customer relationships, with 7.5 million postpaid phone net
adds and 2.9 million AT&T Fiber net adds.
"We met or surpassed all of our profitability targets for the
year all while investing at record levels to bring the benefits of
our 5G and fiber technologies to even more people. As we enter
2023, I'm confident in the trajectory of our business and in our
team's ability to deliver profitable and durable growth for our
shareholders."
Consolidated Financial Results
Revenues from continuing operations for the fourth
quarter totaled $31.3 billion
versus $31.1 billion in the
year-ago quarter, up 0.8%. This increase primarily reflects higher
Mobility, Mexico and Consumer
Wireline revenues, partly offset by lower Business Wireline
revenues.
Operating expenses from continuing operations were
$52.4 billion versus
$26.2 billion in the year-ago
quarter. Operating expenses increased primarily due to non-cash
goodwill impairments and asset abandonments and restructuring
charges in the current quarter totaling $26.8 billion. Goodwill impairments of
$24.8 billion were associated with
our Business Wireline, Consumer Wireline and Mexico reporting units and were driven by
higher interest rates consistent with the macroeconomic
environment, with secular declines also impacting Business Wireline
growth rates. Asset abandonments of $1.4
billion were associated with certain wireline conduits no
longer required to support our copper and fiber networks. To a
lesser extent, the year-over-year increase also reflected higher
bad debt expense and increased depreciation, partly offset by lower
wireless equipment costs from lower volumes and the lack of 3G
network shutdown costs in the fourth quarter of 2022.
Operating income (loss) from continuing operations
was ($21.1) billion versus
$4.9 billion in the year-ago
quarter. When adjusting for the asset impairments and abandonments,
and other items, adjusted operating income* from
continuing operations was $5.7 billion versus $5.0 billion in the year-ago quarter.
Equity in net income of affiliates of $0.4 billion primarily from the DIRECTV
investment. With adjustment for our proportionate share of
intangible amortization, adjusted equity in net income from the
DIRECTV investment* was $0.7 billion.
Income (loss) from continuing operations was
($23.1) billion versus
$5.2 billion in the year-ago
quarter. Earnings per common share from continuing operations was
($3.20) versus $0.66 in the year-ago quarter. Adjusting for
($3.81), which includes asset
impairments and abandonments, an actuarial loss on benefit plans,
our proportionate share of intangible amortization from the DIRECTV
equity method investment and other items, earnings per diluted
common share* from continuing operations was $0.61 compared to $0.56 in the year-ago quarter.
Cash from operating activities from continuing
operations was $10.3 billion, up
$2.3 billion year over year.
Capital expenditures from continuing operations were
$4.2 billion in the quarter
versus $3.5 billion in the
year-ago quarter. Capital investment* from
continuing operations, which includes $0.5 billion of cash payments for vendor
financing, totaled $4.7 billion.
Free cash flow* from continuing
operations was $6.1 billion for
the quarter.
Full-Year Results
Revenues from continuing operations for the full
year totaled $120.7 billion
versus $134.0 billion in 2021,
down 9.9% reflecting the impact of the U.S. Video separation in
July 2021. Excluding the impact of
U.S. Video, operating revenues for standalone
AT&T* were up 2.1%, from $118.2 billion, primarily driven by higher
revenues from Mobility, and, to a lesser extent, Mexico and Consumer Wireline, partially offset
by lower Business Wireline revenues.
Operating expenses from continuing operations were
$125.3 billion compared with
$108.1 billion in 2021 primarily
due to higher non-cash asset impairments and abandonments, and
restructuring charges, partly offset by the inclusion in the prior
year of U.S. Video results for seven months as well as other
divested businesses. To a lesser extent, the year-over-year
increase reflects higher bad debt expense, the elimination of CAF
II government credits and increased wholesale network access
charges. Wireless equipment costs were up slightly year over year
as the impacts of higher sales volumes and the sale of
higher-priced smartphones were largely offset by lower 3G network
shutdown costs.
Operating income (loss) from continuing operations
was ($4.6) billion versus
$25.9 billion in 2021. When
adjusting for asset impairments, abandonments, restructuring, and
other items, adjusted operating income* from continuing
operations was $23.5 billion
versus $26.2 billion a year ago.
When excluding the impacts of prior-year dispositions, standalone
AT&T* adjusted operating income totaled $22.3 billion for full year 2021.
Equity in net income of affiliates of $1.8 billion primarily from the DIRECTV
investment. With adjustment for our proportionate share of
intangible amortization, adjusted equity in net income from the
DIRECTV investment* for full year 2022 was $3.4 billion.
Income (loss) from continuing operations was
($6.9) billion versus $23.8 billion a year ago. Earnings per
common share from continuing operations was ($1.10) versus $3.02 for full-year 2021. With adjustments for
both years, adjusted earnings per diluted common share from
continuing operations* was $2.57
versus $2.63 for full-year 2021. On a
standalone AT&T* comparative basis, adjusted earnings per
diluted common share was $2.41 for
2021.
Cash from operating activities from continuing
operations was $35.8 billion,
down from $37.2 billion in the
prior year due to inclusion of U.S. Video in 2021. Capital
expenditures from continuing operations were $19.6 billion for the full year, versus
$15.5 billion for full-year
2021. Capital investment* from continuing
operations, which includes $4.7 billion of cash payments for vendor
financing, totaled $24.3 billion.
Free cash flow* from continuing
operations was $14.1 billion for
the full year. Total debt was $135.9
billion at the end of the fourth quarter, and net
debt* was $132.2 billion.
Communications Operational Highlights
Fourth-quarter revenues were $30.4 billion, up 0.5% year over year due to
increases in Mobility and Consumer Wireline, which more than offset
a decline in Business Wireline. Operating income was
$7.2 billion, up 12.7% year over
year, with operating income margin of 23.8%,
compared to 21.2% in the year-ago quarter. Operating income in the
quarter reflects the lower costs associated with a third-quarter
2022 retirement benefit plan change of about $115 million,
with about $50 million for Business Wireline, $40 million
for Consumer Wireline and $20 million for Mobility.
Mobility
- Revenues were up 1.7% year over year to $21.5 billion due to higher service revenues.
Service revenues were $15.4
billion, up 5.2% year over year, primarily driven by
subscriber and postpaid ARPU growth. Equipment revenues were
$6.1 billion, down 6.3% year over
year, driven by lower volumes.
- Operating expenses were $15.5
billion, down 2.3% year over year primarily due to lower
equipment costs including the absence of 3G network shutdown costs,
gains from tower transactions, decreased advertising costs and
lower content costs. These decreases were partially offset by
higher bad debt expense, increased amortization of customer
acquisition costs and the elimination of CAF II government
credits.
- Operating income was $6.0
billion, up 13.4% year over year. Operating income
margin was 28.1%, compared to 25.2% in the year-ago
quarter.
- EBITDA* was $8.1 billion, up 10.1% year over year with
EBITDA margin* of 37.8%, up from 34.9% a
year ago. EBITDA service margin* was
52.6%, up from 50.3% in the year-ago quarter.
- Total wireless net adds were 6.4 million including:
-
- 1.1 million postpaid net adds with:
-
- 656,000 postpaid phone net adds
- 39,000 postpaid tablet and other branded computing device net
adds
- 409,000 other net adds
- (13,000) prepaid phone net adds
- Postpaid churn was 1.01% versus 1.02% in the year-ago
quarter.
- Postpaid phone churn was 0.84% versus 0.85% in the
year-ago quarter.
- Prepaid churn was less than 3%, with Cricket
substantially lower.
- Postpaid phone-only ARPU was $55.43, up 2.5% versus the year-ago quarter, due
to pricing actions, higher international roaming and a mix shift to
higher-priced unlimited plans.
- FirstNet® connections reached approximately 4.4 million
across more than 24,000 agencies. FirstNet is the nationwide
communications platform dedicated to public safety. The AT&T
and FirstNet networks cover more than 99% of the U.S. population,
and FirstNet covers more first responders than any other network in
America.
Business Wireline
- Revenues were $5.6
billion, down 4.5% year over year due to lower demand for
legacy voice and data services and product simplification, partly
offset by growth in connectivity services. The quarter also
included approximately $90 million in
revenues from intellectual property sales, an increase of about
$15 million year over year.
- Operating expenses were $4.8
billion, down 3.8% year over year due to ongoing operational
cost efficiencies, credits associated with a retirement benefit
plan change in the third quarter of 2022 and lower amortization of
deferred fulfillment costs, partly offset by higher wholesale
network access costs and higher depreciation expense.
- Operating income was $801
million, down 8.6%, with operating income margin of
14.2% compared to 14.8% in the year-ago quarter.
- EBITDA* was $2.2
billion, down 1.5% year over year with EBITDA
margin* of 38.3%, compared to 37.2% in the year-ago
quarter. EBITDA margin for both periods includes the impacts from
intellectual property sales.
- AT&T Business serves the largest global companies,
government agencies and small businesses. More than 750,000 U.S.
business buildings are lit with fiber from AT&T, enabling
high-speed fiber connections to more than 3 million U.S. business
customer locations. Nationwide, more than 10 million business
customer locations are on or within 1,000 feet of our
fiber.3
Consumer Wireline
- Revenues were $3.2
billion, up 2.2% year over year due to gains in broadband
more than offsetting declines in legacy voice and data and other
services. Broadband revenues increased 7.2% due to fiber
growth of more than 31%, partly offset by non-fiber revenue
declines of 12.6%.
- Operating expenses were $2.9
billion, down 3.5% year over year due to lower network and
customer support costs, decreased advertising costs, credits
associated with a retirement benefit plan change in the third
quarter of 2022, and lower content costs, partly offset by the
elimination of CAF II government credits, higher depreciation
expense and higher bad debt expense.
- Operating income was $376
million, up 86.1% year over year with operating income
margin of 11.6%, compared to 6.4% in the year-ago quarter.
- EBITDA* was $1.2
billion, up 20.5% year over year with EBITDA
margin* of 37.0%, up from 31.4% in the year-ago
quarter.
- Total broadband losses, excluding DSL, were 43,000,
reflecting AT&T Fiber net adds of 280,000, more than
offset by losses in non-fiber services. AT&T Fiber now has the
ability to serve more than 19 million customer locations and offers
symmetrical, multi-gig speeds across parts of its entire footprint
of more than 100 metro areas.
Latin America – Mexico
Operational Highlights4
Revenues were $861 million, up 22.3% year over year
primarily due to growth in both service and equipment revenues,
including favorable foreign exchange impacts. Service
revenues were $579 million, up 19.4% year over year,
driven by growth in wholesale revenue and subscribers. Equipment
revenues were $282 million, up 28.8% year over year due to
higher sales.
Operating loss was ($79) million compared to ($117) million in the year-ago quarter.
EBITDA* was $85 million compared to
$36 million in the year-ago quarter.
Total wireless net adds were 605,000, including 515,000
prepaid net adds, 71,000 postpaid net adds and 19,000
reseller net adds.
FirstNet and the
FirstNet logo are registered trademarks and service marks of the
First Responder Network Authority. All other marks are the property
of their respective owners.
|
|
1 With
the closing of the WarnerMedia transaction in April 2022,
historical financial results have been recast to present
WarnerMedia and other divested businesses, including Vrio, Xandr
and Playdemic, as discontinued operations. Consolidated results
reflect AT&T's remaining continuing operations, which include
U.S. Video and certain other dispositions in the prior
year.
|
|
2 Reported Earnings per Common
Share from continuing operations is calculated using Income
(Loss) from Continuing Operations, less Net Income Attributable to
Noncontrolling Interest and Preferred Stock Dividends and
adjustment for distributions on Mobility II preferred interests and
share-based payments (in periods of net income) or adjustment of
carrying value of noncontrolling interest (in periods of net loss),
divided by the weighted average common shares outstanding for the
period.
|
|
3 The more
than 3 million U.S. business customer locations are included
within the 10+ million U.S. business customer locations on or
within 1,000 feet of our fiber.
|
|
4 Latin
America segment results have been recast to classify Vrio as a
discontinued operation. Segment results consist solely of AT&T
Mexico operations.
|
About AT&T
We help more than 100 million U.S. families, friends and
neighbors, plus nearly 2.5 million businesses, connect to greater
possibility. From the first phone call 140+ years ago to our 5G
wireless and multi-gig internet offerings today, we @ATT innovate
to improve lives. For more information about AT&T Inc.
(NYSE:T), please visit us at
about.att.com. Investors can learn more at
investors.att.com.
Cautionary Language Concerning Forward-Looking
Statements
Information set forth in this news release contains financial
estimates and other forward-looking statements that are subject to
risks and uncertainties, and actual results might differ
materially. 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 and revise
statements contained in this news release based on new information
or otherwise. This news release may contain certain non-GAAP
financial measures. Reconciliations between the non-GAAP financial
measures and the GAAP financial measures are available on the
company's website at https://investors.att.com.
Non-GAAP Measures and Reconciliations to GAAP
Measures
Schedules and reconciliations of non-GAAP financial measures
cited in this document to the most directly comparable financial
measures under generally accepted accounting principles (GAAP) can
be found at https://investors.att.com and in our Form 8-K
dated January 25, 2023. Free cash
flow, EBITDA, adjusted operating income and net debt are non-GAAP
financial measures frequently used by investors and credit rating
agencies.
Adjusted diluted EPS from continuing operations includes
adjusting items to revenues and costs that we consider
non-operational in nature, including items arising from asset
acquisitions or dispositions. We adjust for net actuarial gains or
losses associated with our pension and postemployment benefit plans
due to the often-significant impact on our results (we immediately
recognize this gain or loss in the income statement, pursuant to
our accounting policy for the recognition of actuarial gains and
losses). Consequently, our adjusted results reflect an expected
return on plan assets rather than the actual return on plan assets,
as included in the GAAP measure of income. The tax impact of
adjusting items is calculated using the effective tax rate during
the quarter except for adjustments that, given their magnitude, can
drive a change in the effective tax rate, in these cases we use the
actual tax expense or combined marginal rate of approximately
25%.
For 4Q22, Adjusted EPS from continuing operations of
$0.61 is Reported EPS from continuing
operations of ($3.20) adjusted for
$3.57 impairments, abandonments and
restructuring, $0.19 actuarial loss
on benefit plans, $0.04 proportionate
share of intangible amortization at the DIRECTV equity method
investment, $0.04 benefit-related and
other costs and $0.01 impact of
Accounting Standards Update (ASU) No. 2020-06, minus $0.04 benefit from tax items.
For 4Q21, Adjusted EPS from continuing
operations of $0.56 is Diluted EPS
from continuing operations of $0.66
adjusted for $0.05 proportionate
share of intangible amortization at the DIRECTV equity method
investment, $0.01 asset impairments
and $0.01 impact of ASU No. 2020-06,
minus $0.11 actuarial gain on benefit
plans, $0.03 benefit from tax items
and $0.03 of benefit-related and
other costs.
For 2022, Adjusted EPS from continuing
operations of $2.57 is Reported EPS
from continuing operations of ($1.10)
adjusted for $3.59 impairments,
abandonments and restructuring, $0.19
benefit-related and other costs, $0.16 proportionate share of intangible
amortization at the DIRECTV equity method investment, and
$0.06 impact of ASU No. 2020-06,
minus $0.20 actuarial gain on benefit
plans and $0.13 benefit from tax
items.
For 2021, Adjusted EPS from continuing
operations of $2.63 is Diluted EPS
from continuing operations of $3.02
adjusted for $0.09 proportionate
share of intangible amortization at the DIRECTV equity method
investment, $0.03 impact of ASU No.
2020-06, and $0.02 asset impairments,
minus $0.42 actuarial gain on benefit
plans, $0.08 benefit from tax items
and $0.03 of benefit-related and
other costs.
The company expects adjustments to 2023 reported diluted EPS to
include our proportionate share of intangible amortization at the
DIRECTV equity method investment in the range of $1.3 billion, a non-cash mark-to-market
benefit plan gain/loss, the impact of ASU No. 2020-06 and other
items. The company expects the mark-to-market adjustment, which is
driven by interest rates and investment returns that are not
reasonably estimable at this time, to be a significant item. Our
projected 2023 Adjusted EPS depends on future levels of
revenues and expenses, most of which are not reasonably estimable
at this time. Accordingly, we cannot provide a reconciliation
between these projected non-GAAP metrics and the reported GAAP
metrics without unreasonable effort.
Capital investment from continuing operations is a
non-GAAP financial measure that provides an additional view of cash
paid for capital investment to provide a comprehensive view of cash
used to invest in our networks, product developments and support
systems. In connection with capital improvements, we negotiate with
some of our vendors to obtain favorable payment terms of 120 days
or more, referred to as vendor financing, which are excluded from
capital expenditures and reported in accordance with GAAP as
financing activities. Capital investment from continuing operations
includes capital expenditures from continuing operations and cash
paid for vendor financing ($0.5 billion in 4Q22, $4.7 billion in 2022). For 2023,
capital investment is expected to be about $24 billon, consistent with 2022 levels. Due to
high variability and difficulty in predicting items that impact
capital expenditures and vendor financing payments, the company is
not able to provide a reconciliation between projected capital
investment and the most comparable GAAP metrics without
unreasonable effort.
Free cash flow from continuing operations for 4Q22
of $6.1 billion is cash from
operating activities from continuing operations of $10.3 billion, plus cash distributions from
DIRECTV classified as investing activities of $0.4 billion, minus capital expenditures
from continuing operations of $4.2 billion and cash paid for vendor
financing of $0.5 billion.
For 2022, free cash flow from continuing
operations of $14.1 billion is
cash from operating activities from continuing operations of
$35.8 billion, plus cash
distributions from DIRECTV classified as investing activities of
$2.6 billion, minus capital
expenditures from continuing operations of $19.6 billion and cash paid for vendor
financing of $4.7 billion.
Due to high variability and difficulty in
predicting items that impact cash from operating activities, cash
distributions from DIRECTV, capital expenditures and vendor
financing payments, the company is not able to provide a
reconciliation between projected free cash flow and the most
comparable GAAP metric without unreasonable effort.
EBITDA is operating income before depreciation and
amortization. EBITDA margin is operating income before
depreciation and amortization, divided by total revenues. EBITDA
service margin is operating income before depreciation and
amortization, divided by total service revenues.
Adjusted EBITDA is calculated by
excluding from operating revenues and operating expenses certain
significant items that are non-operational or non-recurring in
nature, including dispositions and merger integration and
transaction costs, significant abandonments and impairment,
benefit-related gains and losses, employee separation and other
material gains and losses.
EBITDA and Adjusted EBITDA
estimates depend on future levels of revenues and expenses which
are not reasonably estimable at this time. Accordingly, we cannot
provide a reconciliation between projected EBITDA and projected
Adjusted EBITDA and the most comparable GAAP metrics without
unreasonable effort.
Standalone AT&T results reflect the historical
operating results of the company presented as continuing
operations, and also excludes U.S. Video and other 2021
dispositions included in Corporate and Other. Standalone AT&T
results are presented to provide 2021 full-year results that are
comparable to 2022 continuing operations financial data. For the
current and future quarters and 2022, standalone AT&T is the
same as continuing operations. See our Form 8-K dated January 25, 2023, for further discussion and
information.
Operating Revenues of standalone
AT&T for 2021 of $118.2 billion is calculated as Operating
Revenues from continuing operations of $134.0 billion less revenues of $15.8 billion from U.S. Video and other
divested businesses.
Adjusted Operating Income of standalone
AT&T for 2021 of $22.3 billion is calculated as Adjusted
Operating Income from continuing operations of $26.2 billion less $3.9 billion from U.S. Video and other
divested businesses, including a comparative adjustment applied to
prior periods for estimated DIRECTV-related retained costs. After
the 3Q21 DIRECTV transaction, we retained incurred operations and
support costs and depreciation of network infrastructure, that
provides both U-verse video and broadband services to customers.
Approximately 60% of these costs will be received from DIRECTV
through transition service agreements and commercial
arrangements.
Standalone AT&T Adjusted diluted EPS
for 2021 of $2.41 is calculated as
Adjusted EPS from continuing operations of $2.63 less $0.22 of
adjustments to exclude operating income of U.S. Video (including
estimated retained costs) and other dispositions, and include our
estimate of equity in net income from DIRECTV investment.
Adjusted Operating Income from continuing
operations is operating income from continuing operations
adjusted for revenues and costs we consider non-operational in
nature, including items arising from asset acquisitions or
dispositions. For 4Q22, Adjusted Operating Income from
continuing operations of $5.7 billion is calculated as operating
income from continuing operations of ($21.1) billion plus $26.7 billion of adjustments. For
4Q21, Adjusted Operating Income from continuing operations
of $5.0 billion is calculated as
operating income from continuing operations of $4.9 billion plus $0.1 billion of adjustments.
For 2022, Adjusted Operating Income from
continuing operations of $23.5 billion is calculated as Operating
Income from continuing operations of ($4.6) billion plus $28.1 billion of adjustments. For
2021, Adjusted Operating Income from continuing operations
of $26.2 billion is calculated
as operating income from continuing operations of $25.9 billion plus $0.3 billion of adjustments. Adjustments for
all periods are detailed in the Discussion and Reconciliation of
Non-GAAP Measures included in our Form 8-K dated January 25, 2023.
Adjusted Equity in Net Income from DIRECTV
investment of $0.7 billion for 4Q22 ($3.4 billion for 2022) is calculated as
equity income from DIRECTV of $0.4 billion ($1.8 billion for 2022) reported in Equity in
Net Income of Affiliates and excludes $0.4 billion ($1.5 billion for 2022) of AT&T's
proportionate share of the noncash depreciation and amortization of
fair value accretion from DIRECTV's revaluation of assets and
purchase price allocation. Our projected 2023 adjusted equity in
net income from DIRECTV investment depends on financial projections
provided by DIRECTV. The company is not able to provide a
reconciliation to the most comparable GAAP metric as DIRECTV's
financial results are not reasonably estimable by
AT&T.
Net Debt of $132.2 billion at December 31, 2022 is calculated as Total Debt of
$135.9 billion less Cash and Cash
Equivalents of $3.7 billion).
Discussion and Reconciliation of Non-GAAP Measures for
Continuing Operations
We believe the following measures are relevant and useful
information to investors as they are part of AT&T's internal
management reporting and planning processes and are important
metrics that management uses to evaluate the operating performance
of AT&T and its segments. Management also uses these measures
as a method of comparing performance with that of many of our
competitors. These measures should be considered in addition to,
but not as a substitute for, other measures of financial
performance reported in accordance with U.S. generally accepted
accounting principles (GAAP).
On April 8, 2022, we completed the
previously announced separation of our WarnerMedia business. With
the separation and distribution, the WarnerMedia business met the
criteria for discontinued operations. For discontinued operations,
we evaluated transactions that were components of AT&T's single
plan of a strategic shift, including dispositions that may not have
individually met the criteria due to materiality, and have
determined discontinued operations to be comprised of WarnerMedia,
Vrio, Xandr and Playdemic Ltd. (Playdemic). These businesses are
reflected in our historical financial statements as discontinued
operations, including for periods prior to the consummation of the
WarnerMedia/Discovery transaction. The information below refers
only to our continuing operations and does not include discussion
of balances or activity of WarnerMedia, Vrio, Xandr and
Playdemic.
Free Cash Flow
Free cash flow is defined as cash from operations and cash
distributions from DIRECTV (classified as investing activities)
minus capital expenditures and cash paid for vendor financing
(classified as financing activities). Free cash flow after
dividends is defined as cash from operations and cash distributions
from DIRECTV, minus capital expenditures, cash paid for vendor
financing and dividends on common and preferred shares. Free cash
flow dividend payout ratio is defined as the percentage of
dividends paid on common and preferred shares to free cash flow. We
believe these metrics provide useful information to our investors
because management views free cash flow as an important indicator
of how much cash is generated by routine business operations,
including capital expenditures and vendor financing, and from our
continued economic interest in the U.S. video operations as part of
our DIRECTV equity method investment, and makes decisions based on
it. Management also views free cash flow as a measure of cash
available to pay debt and return cash to shareowners.
Free Cash Flow and
Free Cash Flow Dividend Payout Ratio
|
Dollars in
millions
|
|
|
|
|
|
Fourth
Quarter
|
|
Year Ended
|
|
2022
|
2021
|
|
2022
|
2021
|
Net cash provided by
operating activities from continuing
operations1
|
$
10,348
|
$
8,077
|
|
$
35,812
|
$
37,170
|
Add: Distributions from
DIRECTV classified as investing
activities
|
444
|
1,323
|
|
2,649
|
1,323
|
Less: Capital
expenditures
|
(4,229)
|
(3,494)
|
|
(19,626)
|
(15,545)
|
Less: Cash paid for
vendor financing
|
(460)
|
(583)
|
|
(4,697)
|
(4,596)
|
Free Cash
Flow2
|
6,103
|
5,323
|
|
14,138
|
18,352
|
|
|
|
|
|
|
Less: Dividends
paid
|
(2,014)
|
(3,749)
|
|
(9,859)
|
(15,068)
|
Free Cash Flow after
Dividends
|
$
4,089
|
$
1,574
|
|
$
4,279
|
$
3,284
|
Free Cash Flow
Dividend Payout Ratio
|
33.0 %
|
70.4 %
|
|
69.7 %
|
82.1 %
|
1
Includes distributions from DIRECTV of $379 in the fourth quarter
and $1,808 for the year ended December 31, 2022.
|
2 For
Standalone free cash flow see Exhibit 99.4
|
Cash Paid for Capital Investment
In connection with capital improvements, we negotiate with some
of our vendors to obtain favorable payment terms of 120 days or
more, referred to as vendor financing, which are excluded from
capital expenditures and reported in accordance with GAAP as
financing activities. We present an additional view of cash paid
for capital investment to provide investors with a comprehensive
view of cash used to invest in our networks, product developments
and support systems.
Cash Paid for
Capital Investment
|
Dollars in
millions
|
|
|
|
|
|
Fourth
Quarter
|
|
Year Ended
|
|
2022
|
2021
|
|
2022
|
2021
|
Capital
Expenditures
|
$
(4,229)
|
$
(3,494)
|
|
$
(19,626)
|
$
(15,545)
|
Cash paid for vendor
financing
|
(460)
|
(583)
|
|
(4,697)
|
(4,596)
|
Cash paid for
Capital Investment
|
$
(4,689)
|
$
(4,077)
|
|
$
(24,323)
|
$
(20,141)
|
EBITDA
Our calculation of EBITDA, as presented, may differ from
similarly titled measures reported by other companies. For
AT&T, EBITDA excludes other income (expense) – net, and equity
in net income (loss) of affiliates, as these do not reflect the
operating results of our subscriber base or operations that are not
under our control. Equity in net income (loss) of affiliates
represents the proportionate share of the net income (loss) of
affiliates in which we exercise significant influence, but do not
control. Because we do not control these entities, management
excludes these results when evaluating the performance of our
primary operations. EBITDA also excludes interest expense and the
provision for income taxes. Excluding these items eliminates the
expenses associated with our capital and tax structures. Finally,
EBITDA excludes depreciation and amortization in order to eliminate
the impact of capital investments. EBITDA does not give effect to
cash used for debt service requirements and thus does not reflect
available funds for distributions, reinvestment or other
discretionary uses. EBITDA is not presented as an alternative
measure of operating results or cash flows from operations, as
determined in accordance with GAAP.
EBITDA service margin is calculated as EBITDA divided by service
revenues.
These measures are used by management as a gauge of our success
in acquiring, retaining and servicing subscribers because we
believe these measures reflect AT&T's ability to generate and
grow subscriber revenues while providing a high level of customer
service in a cost-effective manner. Management also uses these
measures as a method of comparing cash generation potential with
that of many of its competitors. The financial and operating
metrics which affect EBITDA include the key revenue and expense
drivers for which management is responsible and upon which we
evaluate performance.
We believe EBITDA Service Margin (EBITDA as a percentage of
service revenues) to be a more relevant measure than EBITDA Margin
(EBITDA as a percentage of total revenue) for our Mobility business
unit operating margin. We also use wireless service revenues to
calculate margin to facilitate comparison, both internally and
externally with our wireless competitors, as they calculate their
margins using wireless service revenues as well.
There are material limitations to using these non-GAAP financial
measures. EBITDA, EBITDA margin and EBITDA service margin, as we
have defined them, may not be comparable to similarly titled
measures reported by other companies. Furthermore, these
performance measures do not take into account certain significant
items, including depreciation and amortization, interest expense,
tax expense and equity in net income (loss) of affiliates. For
market comparability, management analyzes performance measures that
are similar in nature to EBITDA as we present it, and considering
the economic effect of the excluded expense items independently as
well as in connection with its analysis of net income as calculated
in accordance with GAAP. EBITDA, EBITDA margin and EBITDA service
margin should be considered in addition to, but not as a substitute
for, other measures of financial performance reported in accordance
with GAAP.
EBITDA, EBITDA
Margin and EBITDA Service Margin
|
Dollars in
millions
|
|
|
|
|
|
Fourth
Quarter
|
|
Year Ended
|
|
2022
|
2021
|
|
2022
|
2021
|
Income (Loss) from
Continuing Operations
|
$
(23,120)
|
$
5,202
|
|
$
(6,874)
|
$
23,776
|
Additions:
|
|
|
|
|
|
Income Tax Expense
(Benefit)
|
(77)
|
939
|
|
3,780
|
5,395
|
Interest
Expense
|
1,560
|
1,626
|
|
6,108
|
6,716
|
Equity in Net (Income)
of Affiliates
|
(374)
|
(444)
|
|
(1,791)
|
(603)
|
Other (Income) Expense
- Net
|
919
|
(2,429)
|
|
(5,810)
|
(9,387)
|
Depreciation and
amortization
|
4,595
|
4,500
|
|
18,021
|
17,852
|
EBITDA
|
(16,497)
|
9,394
|
|
13,434
|
43,749
|
Transaction and other
cost
|
84
|
(2)
|
|
425
|
41
|
Benefit-related (gain)
loss
|
(109)
|
(20)
|
|
108
|
(128)
|
Assets impairments and
abandonment and restructuring
|
26,753
|
108
|
|
27,498
|
213
|
Adjusted
EBITDA1
|
$
10,231
|
$
9,480
|
|
$
41,465
|
$
43,875
|
Less: Video and Other
dispositions
|
—
|
4
|
|
—
|
(3,807)
|
Standalone AT&T
Adjusted EBITDA2
|
$
10,231
|
$
9,484
|
|
$
41,465
|
$
40,068
|
1 See
page 5 for additional discussion and reconciliation of adjusted
items.
|
2 See
Exhibit 99.4 for reconciliation of Standalone AT&T Adjusted
EBITDA.
|
Segment and Business
Unit EBITDA, EBITDA Margin and EBITDA Service Margin
|
Dollars in
millions
|
|
|
|
|
|
Fourth
Quarter
|
|
Year Ended
|
|
2022
|
2021
|
|
2022
|
2021
|
Communications
Segment
|
Operating
Income
|
$
7,221
|
$
6,410
|
|
$
29,107
|
$
28,393
|
Additions:
|
|
|
|
|
|
Depreciation and
amortization
|
4,258
|
4,156
|
|
16,681
|
16,409
|
EBITDA
|
11,479
|
10,566
|
|
45,788
|
44,802
|
|
|
|
|
|
|
Total Operating
Revenues
|
30,365
|
30,206
|
|
117,067
|
114,730
|
|
|
|
|
|
|
Operating Income
Margin
|
23.8 %
|
21.2 %
|
|
24.9 %
|
24.7 %
|
EBITDA
Margin
|
37.8 %
|
35.0 %
|
|
39.1 %
|
39.0 %
|
Mobility
|
Operating
Income
|
$
6,044
|
$
5,332
|
|
$
24,528
|
$
23,370
|
Additions:
|
|
|
|
|
|
Depreciation and
amortization
|
2,080
|
2,050
|
|
8,198
|
8,122
|
EBITDA
|
8,124
|
7,382
|
|
32,726
|
31,492
|
|
|
|
|
|
|
Total Operating
Revenues
|
21,501
|
21,146
|
|
81,780
|
78,254
|
Service
Revenues
|
15,434
|
14,669
|
|
60,499
|
57,590
|
|
|
|
|
|
|
Operating Income
Margin
|
28.1 %
|
25.2 %
|
|
30.0 %
|
29.9 %
|
EBITDA
Margin
|
37.8 %
|
34.9 %
|
|
40.0 %
|
40.2 %
|
EBITDA Service
Margin
|
52.6 %
|
50.3 %
|
|
54.1 %
|
54.7 %
|
Business
Wireline
|
Operating
Income
|
$
801
|
$
876
|
|
$
3,252
|
$
4,027
|
Additions:
|
|
|
|
|
|
Depreciation and
amortization
|
1,360
|
1,317
|
|
5,314
|
5,192
|
EBITDA
|
2,161
|
2,193
|
|
8,566
|
9,219
|
|
|
|
|
|
|
Total Operating
Revenues
|
5,635
|
5,901
|
|
22,538
|
23,937
|
|
|
|
|
|
|
Operating Income
Margin
|
14.2 %
|
14.8 %
|
|
14.4 %
|
16.8 %
|
EBITDA
Margin
|
38.3 %
|
37.2 %
|
|
38.0 %
|
38.5 %
|
Consumer
Wireline
|
Operating
Income
|
$
376
|
$
202
|
|
$
1,327
|
$
996
|
Additions:
|
|
|
|
|
|
Depreciation and
amortization
|
818
|
789
|
|
3,169
|
3,095
|
EBITDA
|
1,194
|
991
|
|
4,496
|
4,091
|
|
|
|
|
|
|
Total Operating
Revenues
|
3,229
|
3,159
|
|
12,749
|
12,539
|
|
|
|
|
|
|
Operating Income
Margin
|
11.6 %
|
6.4 %
|
|
10.4 %
|
7.9 %
|
EBITDA
Margin
|
37.0 %
|
31.4 %
|
|
35.3 %
|
32.6 %
|
|
|
|
|
|
|
Latin America
Segment - Mexico
|
|
|
|
|
|
Operating
Income
|
$
(79)
|
$
(117)
|
|
$
(326)
|
$
(510)
|
Additions:
|
|
|
|
|
|
Depreciation and
amortization
|
164
|
153
|
|
658
|
605
|
EBITDA
|
85
|
36
|
|
332
|
95
|
|
|
|
|
|
|
Total Operating
Revenues
|
861
|
704
|
|
3,144
|
2,747
|
|
|
|
|
|
|
Operating Income
Margin
|
-9.2 %
|
-16.6 %
|
|
-10.4 %
|
-18.6 %
|
EBITDA
Margin
|
9.9 %
|
5.1 %
|
|
10.6 %
|
3.5 %
|
Adjusting Items
Adjusting items include revenues and costs we consider
non-operational in nature, including items arising from asset
acquisitions or dispositions. We also adjust for net actuarial
gains or losses associated with our pension and postemployment
benefit plans due to the often-significant impact on our results
(we immediately recognize this gain or loss in the income
statement, pursuant to our accounting policy for the recognition of
actuarial gains and losses). Consequently, our adjusted results
reflect an expected return on plan assets rather than the actual
return on plan assets, as included in the GAAP measure of income.
Prior periods have been recast for consistency to include gains on
benefit-related and other cost investments.
The tax impact of adjusting items is calculated using the
effective tax rate during the quarter except for adjustments that,
given their magnitude, can drive a change in the effective tax
rate, in these cases we use the actual tax expense or combined
marginal rate of approximately 25%.
Adjusting
Items
|
Dollars in
millions
|
|
|
|
|
|
Fourth
Quarter
|
|
Year Ended
|
|
2022
|
2021
|
|
2022
|
2021
|
Operating
Expenses
|
|
|
|
|
|
Transaction and other
costs
|
84
|
(2)
|
|
425
|
41
|
Benefit-related (gain)
loss
|
(109)
|
(20)
|
|
108
|
(128)
|
Asset impairments and
abandonment and restructuring
|
26,753
|
108
|
|
27,498
|
213
|
Adjustments to
Operations and Support Expenses
|
26,728
|
86
|
|
28,031
|
126
|
Amortization of
intangible assets
|
16
|
28
|
|
76
|
170
|
Adjustments to
Operating Expenses
|
26,744
|
114
|
|
28,107
|
296
|
Other
|
|
|
|
|
|
DIRECTV
intangible amortization (proportionate share)
|
359
|
434
|
|
1,547
|
826
|
Benefit-related (gain)
loss, transaction financing costs and other
|
420
|
(84)
|
|
1,242
|
(421)
|
Actuarial (gain)
loss
|
1,839
|
(1,119)
|
|
(1,999)
|
(4,140)
|
Adjustments to
Income Before Income Taxes
|
29,362
|
(655)
|
|
28,897
|
(3,439)
|
Tax impact of
adjustments
|
1,082
|
(131)
|
|
882
|
(854)
|
Tax-related
items
|
329
|
240
|
|
977
|
608
|
Adjustments to Net
Income
|
$
27,951
|
$
(764)
|
|
$
27,038
|
$
(3,193)
|
|
Adjusted Operating Income, Adjusted Operating Income Margin,
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA service
margin and Adjusted diluted EPS are non-GAAP financial measures
calculated by excluding from operating revenues, operating expenses
and income tax expense certain significant items that are
non-operational or non-recurring in nature, including dispositions
and merger integration and transaction costs, actuarial gains and
losses, significant abandonments and impairment, benefit-related
gains and losses, employee separation and other material gains and
losses. Management believes that these measures provide relevant
and useful information to investors and other users of our
financial data in evaluating the effectiveness of our operations
and underlying business trends.
Adjusted Operating Revenues, Adjusted Operating Income, Adjusted
Operating Income Margin, Adjusted EBITDA, Adjusted EBITDA margin,
Adjusted EBITDA service margin and Adjusted diluted EPS should be
considered in addition to, but not as a substitute for, other
measures of financial performance reported in accordance with GAAP.
AT&T's calculation of Adjusted items, as presented, may differ
from similarly titled measures reported by other companies.
Adjusted Operating
Income, Adjusted Operating Income Margin,
Adjusted EBITDA and
Adjusted EBITDA Margin
|
Dollars in
millions
|
|
|
|
|
|
Fourth
Quarter
|
|
Year Ended
|
|
2022
|
2021
|
|
2022
|
2021
|
Operating
Income
|
$ (21,092)
|
$
4,894
|
|
$
(4,587)
|
$
25,897
|
Adjustments to
Operating Expenses
|
26,744
|
114
|
|
28,107
|
296
|
Adjusted Operating
Income
|
5,652
|
5,008
|
|
23,520
|
26,193
|
|
|
|
|
|
|
EBITDA
|
(16,497)
|
9,394
|
|
13,434
|
43,749
|
Adjustments to
Operations and Support Expenses
|
26,728
|
86
|
|
28,031
|
126
|
Adjusted
EBITDA
|
10,231
|
9,480
|
|
41,465
|
43,875
|
|
|
|
|
|
|
Total Operating
Revenues
|
31,343
|
31,095
|
|
120,741
|
134,038
|
|
|
|
|
|
|
Operating Income
Margin
|
(67.3) %
|
15.7 %
|
|
(3.8) %
|
19.3 %
|
Adjusted Operating
Income Margin
|
18.0 %
|
16.1 %
|
|
19.5 %
|
19.5 %
|
Adjusted EBITDA
Margin
|
32.6 %
|
30.5 %
|
|
34.3 %
|
32.7 %
|
Adjusted Diluted
EPS
|
|
Fourth
Quarter
|
|
Year Ended
|
|
2022
|
2021
|
|
2022
|
2021
|
Diluted Earnings Per
Share (EPS)
|
$
(3.20)
|
$
0.66
|
|
$
(1.10)
|
$
3.02
|
DIRECTV intangible
amortization (proportionate share)
|
0.04
|
0.05
|
|
0.16
|
0.09
|
Actuarial (gain) loss
1
|
0.19
|
(0.11)
|
|
(0.20)
|
(0.42)
|
Impairments,
abandonments and restructuring
|
3.57
|
0.01
|
|
3.59
|
0.02
|
Benefit-related,
transaction and other costs1, 2
|
0.05
|
(0.02)
|
|
0.25
|
—
|
Tax-related
items
|
(0.04)
|
(0.03)
|
|
(0.13)
|
(0.08)
|
Adjusted
EPS
|
$
0.61
|
$
0.56
|
|
$
2.57
|
$
2.63
|
Less: Video and Other
dispositions
|
—
|
—
|
|
—
|
(0.22)
|
Standalone AT&T
Adjusted EPS
|
$
0.61
|
$
0.56
|
|
$
2.57
|
$
2.41
|
Year-over-year
growth - Adjusted
|
8.9 %
|
|
|
6.6 %
|
|
Weighted Average
Common Shares Outstanding
with
Dilution (000,000)
|
7,533
|
7,541
|
|
7,587
|
7,503
|
1
Includes adjustments for actuarial gains or losses associated with
our pension and postemployment benefit plans, which we immediately
recognize in the income statement, pursuant to our accounting
policy for the recognition of actuarial gains/losses. We recorded
total net actuarial gains of $2.0 billion in 2022. As a result,
adjusted EPS reflects an expected return on plan assets of $3.2
billion (based on an average expected return on plan assets of
6.75% for our pension trust and 4.5% for our VEBA trusts), rather
than the actual return on plan assets of $11.3 billion loss (actual
pension return of -14.8% and VEBA return of -13.2%), included in
the GAAP measure of income. Adjustments also include the impact to
our 2022 quarterly benefit expense accruals that resulted from
quarterly remeasurements of plan assets and obligations, which
included increases in the assumed discount rates.
|
|
2 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.
|
|
Additionally, in the
fourth quarter of 2022, all outstanding Mobility II preferred
interests were put to us, with approximately one-third redeemed in
the fourth-quarter; approximately 107 million interests will be
redeemed primarily in October 2023 and 107 million redeemed in
October 2024, per the terms of the agreement, unless called or put
is accepted by AT&T prior. With the certainty of redemption,
the remaining Mobility preferred interest was reclassified from
equity to a liability at fair value, with approximately $2.7
billion recorded in current as "Accounts payable and accrued
liabilities" and $2.7 billion as "Other noncurrent liabilities. The
difference between the carrying value of the Mobility preferred
interest and the fair value of the instrument upon settlement
and/or balance sheet reclassification was recorded as an adjustment
to additional paid-in capital; the fair value adjustment of these
instruments is required to be included when calculating
EPS.
|
|
Given our intent to
settle the Mobility II preferred interests in cash, and the
nonoperational fair value adjustment recorded as "Additional Paid
in Capital," we have excluded these impacts from our adjusted EPS
calculation. The per share impact was to decrease reported diluted
EPS $0.01 and $0.01 for the quarters ended December 31, 2022 and
2021, and $0.06 and $0.03 for the year ended December 31, 2022 and
2021, respectively.
|
|
3 See
Exhibit 99.4 for reconciliation of Standalone AT&T Adjusted
EPS.
|
Net Debt to Adjusted EBITDA
Net Debt to EBITDA ratios are non-GAAP financial measures
frequently used by investors and credit rating agencies and
management believes these measures provide relevant and useful
information to investors and other users of our financial data. Our
Net Debt to Adjusted EBITDA ratio is calculated by dividing the Net
Debt by the sum of the most recent four quarters Adjusted EBITDA.
Net Debt is calculated by subtracting cash and cash equivalents and
certificates of deposit and time deposits that are greater than 90
days, from the sum of debt maturing within one year and long-term
debt.
Net Debt to Adjusted
EBITDA - 2022
|
Dollars in
millions
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
March. 31
|
|
June
30,
|
|
Sept.
30,
|
|
Dec.
31,
|
|
Four
Quarters
|
|
|
2022
1
|
|
2022
1
|
|
2022
1
|
|
2022
1
|
|
Adjusted
EBITDA
|
|
$
10,190
|
|
$
10,330
|
|
$
10,714
|
|
$
10,231
|
|
$
41,465
|
End-of-period current
debt
|
|
|
|
|
|
|
|
|
|
7,467
|
End-of-period
long-term debt
|
|
|
|
|
|
|
|
|
|
128,423
|
Total End-of-Period
Debt
|
|
|
|
|
|
|
|
|
|
135,890
|
Less: Cash and Cash
Equivalents
|
|
|
|
|
|
|
|
|
|
3,701
|
Net Debt
Balance
|
|
|
|
|
|
|
|
|
|
132,189
|
Annualized Net Debt
to Adjusted EBITDA Ratio
|
|
|
|
|
|
|
|
|
|
3.19
|
1 As
reported in Exhibit 99.4
|
Net Debt to Adjusted
EBITDA - 2021
|
Dollars in
millions
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
March 31,
|
|
June 30,
|
|
Sept. 30,
|
|
Dec. 31,
|
|
Four
Quarters
|
|
|
2021
1
|
|
2021
1
|
|
2021
1
|
|
2021
1
|
|
Adjusted
EBITDA
|
|
$
11,661
|
|
$
11,931
|
|
$
10,803
|
|
$
9,480
|
|
$
43,875
|
End-of-period current
debt
|
|
|
|
|
|
|
|
|
|
24,620
|
End-of-period
long-term debt
|
|
|
|
|
|
|
|
|
|
151,011
|
Total End-of-Period
Debt
|
|
|
|
|
|
|
|
|
|
175,631
|
Less: Cash and Cash
Equivalents
|
|
|
|
|
|
|
|
|
|
19,223
|
Net Debt
Balance
|
|
|
|
|
|
|
|
|
|
156,408
|
Annualized Net Debt
to Adjusted EBITDA Ratio
|
|
|
|
|
|
|
|
|
|
3.56
|
1 As
reported in Exhibit 99.4
|
Supplemental Operational Measures
We provide a supplemental discussion of our business solutions
operations that is calculated by combining our Mobility and
Business Wireline operating units, and then adjusting to remove
non-business operations. The following table presents a
reconciliation of our supplemental Business Solutions results.
Supplemental
Operational Measure
|
|
Fourth
Quarter
|
|
December 31,
2022
|
|
December 31,
2021
|
|
Mobility
|
Business
Wireline
|
Adjustments1
|
Business
Solutions
|
|
Mobility
|
Business
Wireline
|
Adjustments1
|
Business
Solutions
|
Operating
Revenues
|
|
|
|
|
|
|
|
|
|
Wireless
service
|
$ 15,434
|
$
—
|
$
(13,176)
|
$
2,258
|
|
$
14,669
|
$
—
|
$
(12,561)
|
$ 2,108
|
Wireline
services
|
—
|
5,473
|
—
|
5,473
|
|
—
|
5,727
|
—
|
5,727
|
Wireless
equipment
|
6,067
|
—
|
(5,130)
|
937
|
|
6,477
|
—
|
(5,447)
|
1,030
|
Wireline
equipment
|
—
|
162
|
—
|
162
|
|
—
|
174
|
—
|
174
|
Total Operating
Revenues
|
21,501
|
5,635
|
(18,306)
|
8,830
|
|
21,146
|
5,901
|
(18,008)
|
9,039
|
|
|
|
|
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
|
|
|
|
|
|
Operations and
support
|
13,377
|
3,474
|
(11,195)
|
5,656
|
|
13,764
|
3,708
|
(11,437)
|
6,035
|
EBITDA
|
8,124
|
2,161
|
(7,111)
|
3,174
|
|
7,382
|
2,193
|
(6,571)
|
3,004
|
Depreciation and
amortization
|
2,080
|
1,360
|
(1,716)
|
1,724
|
|
2,050
|
1,317
|
(1,700)
|
1,667
|
Total Operating
Expenses
|
15,457
|
4,834
|
(12,911)
|
7,380
|
|
15,814
|
5,025
|
(13,137)
|
7,702
|
Operating
Income
|
6,044
|
801
|
(5,395)
|
1,450
|
|
5,332
|
876
|
(4,871)
|
1,337
|
1
Non-business wireless reported in the Communications segment under
the Mobility business unit.
|
Results have been
recast to conform to the current period's
classification.
|
|
|
|
|
|
|
|
|
|
|
Supplemental
Operational Measure
|
|
Year Ended
|
|
December 31,
2022
|
|
December 31,
2021
|
|
Mobility
|
Business
Wireline
|
Adjustments1
|
Business
Solutions
|
|
Mobility
|
Business
Wireline
|
Adjustments1
|
Business
Solutions
|
Operating
Revenues
|
|
|
|
|
|
|
|
|
|
Wireless
service
|
$ 60,499
|
$
—
|
$
(51,710)
|
$
8,789
|
|
$
57,590
|
$
—
|
$
(49,429)
|
$ 8,161
|
Wireline
service
|
—
|
21,891
|
—
|
21,891
|
|
—
|
23,224
|
—
|
23,224
|
Wireless
equipment
|
21,281
|
—
|
(17,712)
|
3,569
|
|
20,664
|
—
|
(17,250)
|
3,414
|
Wireline
equipment
|
—
|
647
|
—
|
647
|
|
—
|
713
|
—
|
713
|
Total Operating
Revenues
|
81,780
|
22,538
|
(69,422)
|
34,896
|
|
78,254
|
23,937
|
(66,679)
|
35,512
|
|
|
|
|
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
|
|
|
|
|
|
Operations and
support
|
49,054
|
13,972
|
(40,547)
|
22,479
|
|
46,762
|
14,718
|
(38,702)
|
22,778
|
EBITDA
|
32,726
|
8,566
|
(28,875)
|
12,417
|
|
31,492
|
9,219
|
(27,977)
|
12,734
|
Depreciation and
amortization
|
8,198
|
5,314
|
(6,763)
|
6,749
|
|
8,122
|
5,192
|
(6,744)
|
6,570
|
Total Operating
Expenses
|
57,252
|
19,286
|
(47,310)
|
29,228
|
|
54,884
|
19,910
|
(45,446)
|
29,348
|
Operating
Income
|
24,528
|
3,252
|
(22,112)
|
5,668
|
|
23,370
|
4,027
|
(21,233)
|
6,164
|
1
Non-business wireless reported in the Communications segment under
the Mobility business unit.
|
Results have been
recast to conform to the current period's
classification.
|
* Further clarification and explanation of non-GAAP measures and
reconciliations to their most comparable GAAP measures can be found
in the "Non-GAAP Measures and Reconciliations to GAAP Measures"
section of the release and at https://investors.att.com.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/att-reports-fourth-quarter-and-full-year-results-301730296.html
SOURCE AT&T