Revenue Recognition

6 Months Ended

Jun. 30, 2022

Revenue Recognition [Abstract]

Revenue Recognition

(3) Revenue Recognition:

We categorize our products, services and other revenues into the following categories:

Data and Internet services include broadband services for consumer and business customers. We provide data transmission services to high volume business customers and other carriers with dedicated high capacity circuits (“nonswitched access”) including services to wireless providers (wireless backhaul);

Voice services include traditional local and long-distance wireline services, Voice over Internet Protocol (VoIP) services, as well as a number of unified messaging services offered to our consumer and business customers. Voice services also include the long-distance voice origination and termination services that we provide to our business customers and other carriers;

Video services include revenues generated from services provided directly to consumer customers as linear terrestrial television services, through DISH® satellite TV service, and through partnerships with over-the-top (OTT) video providers. Video services also includes pay per view revenues, video on demand, equipment rentals, and video advertising. The Company has made the strategic decision to limit sales of new traditional TV services, focusing on our broadband products and OTT video options;

Other customer revenue includes switched access revenue, rents collected for colocation services, and revenue from other services and fees. Switched access revenue includes revenues derived from allowing other carriers to use our network to originate and/or terminate their local and long-distance voice traffic. These services are primarily billed on a minutes-of-use basis applying tariffed rates filed with the FCC or state agencies; and

Subsidy and other regulatory revenue include revenues generated from cost subsidies from state and federal authorities, including CAF II and RDOF.

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The following tables provide a summary of revenues, by category:

	Successor		Successor		Predecessor
	For the three months ended June 30,		For the two months ended June 30,		For the one month ended April 30,
($ in millions)	2022		2021		2021
Data and Internet services	$	847	$	556	$	283
Voice services		381		283		160
Video services		134		105		54
Other		80		62		30
Revenue from contracts with customers (1)		1,442		1,006		527
Subsidy and other revenue (2)		17		55		28
Total revenue	$	1,459	$	1,061	$	555
	Successor		Successor		Predecessor
	For the three months ended June 30,		For the two months ended June 30,		For the one month ended April 30,
($ in millions)	2022		2021		2021
Consumer	$	791	$	543	$	283
Business and wholesale		651		463		244
Revenue from contracts with customers (1)		1,442		1,006		527
Subsidy and other revenue (2)		17		55		28
Total revenue	$	1,459	$	1,061	$	555

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	Successor		Successor		Predecessor
	For the six months ended June 30,		For the two months ended June 30,		For the four months ended April 30,
($ in millions)	2022		2021		2021
Data and Internet services	$	1,683	$	556	$	1,125
Voice services		767		283		647
Video services		271		105		223
Other		163		62		125
Revenue from contracts with customers (1)		2,884		1,006		2,120
Subsidy and other revenue (2)		22		55		111
Total revenue	$	2,906	$	1,061	$	2,231
	Successor		Successor		Predecessor
	For the six months ended June 30,		For the two months ended June 30,		For the four months ended April 30,
($ in millions)	2022		2021		2021
Consumer	$	1,567	$	543	$	1,133
Business and wholesale		1,317		463		987
Revenue from contracts with customers (1)		2,884		1,006		2,120
Subsidy and other revenue (2)		22		55		111
Total revenue	$	2,906	$	1,061	$	2,231

⁽¹⁾Lease revenue included in “Revenue from contracts with customers” was $16 million and $32 million for the three and six months ended June 30, 2022, respectively, $11 million for the two months ended June 30, 2021, and $5 million and $26 million for the one and four months ended April 30, 2021, respectively.

⁽²⁾Subsidy and other revenue for the three and six months ended June 30, 2022, does not include revenue from CAF II as the program ended in 2021. We began to receive funding for RDOF in the second quarter of 2022.

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The following is a summary of the changes in the contract assets and contract liabilities:

	Contract Assets				Contract Liabilities
($ in millions)	Current		Noncurrent		Current		Noncurrent
Balance at December 31, 2021 (Successor)	$	-	$	-	$	27	$	11
Revenue recognized included
in opening contract balance		-		-		(20)		(5)
Credits granted, excluding amounts
recognized as revenue		-		-		18		11
Reclassified between current
and noncurrent		-		-		2		(2)
Balance at June 30, 2022 (Successor)	$	-	$	-	$	27	$	15
	Contract Assets				Contract Liabilities
($ in millions)	Current		Noncurrent		Current		Noncurrent
Balance at December 31, 2020 (Predecessor)	$	6	$	9	$	58	$	20
Revenue recognized included
in opening contract balance		(4)		-		(23)		(3)
Cash received, excluding amounts
recognized as revenue		-		-		22		2
Balance at April 30, 2021 (Predecessor)	$	2	$	9	$	57	$	19
Fresh start accounting adjustments		(2)		(9)		(42)		(18)
Balance at April 30, 2021 (Predecessor)	$	-	$	-	$	15	$	1
Balance at April 30, 2021 (Successor)	$	-	$	-	$	15	$	1
Revenue recognized included
in opening contract balance		-		-		(4)		(1)
Cash received, excluding amounts
recognized as revenue		-		-		8		4
Reclassified between current
and noncurrent		-		-		(1)		1
Balance at June 30, 2021 (Successor)	$	-	$	-	$	18	$	5

The unsatisfied obligations for retail customers consist of amounts in advance billings, which are expected to be earned within the following monthly billing cycle. Unsatisfied obligations for wholesale customers are based on a point-in-time calculation and determined by the number of circuits provided and the contractual price. These wholesale customer obligations change from period to period based on new circuits added as well as circuits that are terminated.

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The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied at the end of the reporting period:

($ in millions)	Revenue from contracts with customers
2022 (remaining six months)	$	461
2023		407
2024		270
2025		135
2026		83
Thereafter		91
Total	$	1,447