Segment Information

9 Months Ended

Sep. 30, 2021

Segment Reporting [Abstract]

Segment Information

Note 11. Segment Information

Reportable Segments

We have two reportable segments that we operate and manage as strategic business units - Consumer and Business. We measure and evaluate our reportable segments based on segment operating income, consistent with the chief operating decision maker’s assessment of segment performance.

Our segments and their principal activities consist of the following:

Segment	Description
Verizon Consumer Group	Our Consumer segment provides consumer-focused wireless and wireline communications services and products. Our wireless services are provided across one of the most extensive wireless networks in the U.S. under the Verizon brand and through wholesale and other arrangements. Our wireline services are provided in nine states in the Mid-Atlantic and Northeastern U.S., as well as Washington D.C., over our 100% fiber-optic network through our Verizon Fios product portfolio and over a traditional copper-based network to customers who are not served by Fios.
Verizon Business Group	Our Business segment provides wireless and wireline communications services and products, including data, video and conferencing services, corporate networking solutions, security and managed network services, local and long distance voice services and network access to deliver various IoT services and products. We provide these products and services to businesses, government customers and wireless and wireline carriers across the U.S. and select products and services to customers around the world.

Our Consumer segment’s wireless and wireline products and services are available to our retail customers, as well as resellers that purchase wireless network access from us on a wholesale basis. Our Business segment’s wireless and wireline products and services are organized by the primary customer groups targeted by these offerings: Small and Medium Business, Global Enterprise, Public Sector and Other, and Wholesale.

Corporate and other primarily includes insurance captives, investments in unconsolidated businesses and development stage businesses that support our strategic initiatives, as well as unallocated corporate expenses, certain pension and other employee benefit related costs and interest and financing expenses. Corporate and other also includes the historical results of divested businesses including Verizon Media, and other adjustments and gains and losses that are not allocated in assessing segment performance due to their nature. Although such transactions are excluded from the business segment results, they are included in reported consolidated earnings. Gains and losses from these transactions that are not individually significant are included in segment results as these items are included in the chief operating decision maker’s assessment of segment performance.

We completed the sale of Verizon Media on September 1, 2021. Refer to Note 3 for additional information on the sale of Verizon Media.

The reconciliation of segment operating revenues and expenses to consolidated operating revenues and expenses below includes the effects of special items that the chief operating decision maker does not consider in assessing segment performance, primarily because of their nature.

The following table provides operating financial information for our two reportable segments:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(dollars in millions)	2021		2020		2021		2020
External Operating Revenues
Consumer
Service	$	16,889	$	16,255	$	50,159	$	48,496
Wireless equipment	4,530		3,403		13,461		9,989
Other	1,852		2,014		5,807		5,946
Total Consumer	23,271		21,672		69,427		64,431
Business
Small and Medium Business	2,929		2,737		8,644		8,132
Global Enterprise	2,551		2,594		7,690		7,811
Public Sector and Other	1,548		1,639		4,807		4,636
Wholesale	645		763		2,038		2,279
Total Business	7,673		7,733		23,179		22,858
Total reportable segments	$	30,944	$	29,405	$	92,606	$	87,289
Intersegment Revenues
Consumer	$	57	$	64	$	176	$	183
Business	16		16		53		54
Total reportable segments	$	73	$	80	$	229	$	237
Total Operating Revenues
Consumer	$	23,328	$	21,736	$	69,603	$	64,614
Business(1)	7,689		7,749		23,232		22,912
Total reportable segments	$	31,017	$	29,485	$	92,835	$	87,526
Operating Income
Consumer	$	7,590	$	7,437	$	22,606	$	21,783
Business	886		923		2,641		2,823
Total reportable segments	$	8,476	$	8,360	$	25,247	$	24,606

(1) Service and other revenues included in our Business segment amounted to approximately $6.9 billion and $7.0 billion for the three months ended September 30, 2021 and 2020, respectively. Service and other revenues included in our Business segment amounted to approximately $20.9 billion for both the nine months ended September 30, 2021 and 2020. Wireless equipment revenues included in our Business segment amounted to approximately $820 million and $709 million for the three months ended September 30, 2021 and 2020, respectively. Wireless equipment revenues included in our Business segment amounted to approximately $2.4 billion and $2.0 billion for the nine months ended September 30, 2021 and 2020, respectively.

The following table provides Fios revenue for our two reportable segments:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(dollars in millions)	2021		2020		2021		2020
Consumer	$	2,893	$	2,773	$	8,648	$	8,326
Business	287		263		844		785
Total Fios revenue	$	3,180	$	3,036	$	9,492	$	9,111

The following table provides Wireless service revenue for our reportable segments and includes intersegment activity:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(dollars in millions)	2021		2020		2021		2020
Consumer	$	13,982	$	13,442	$	41,460	$	40,005
Business	3,097		2,990		9,247		8,732
Total Wireless service revenue	$	17,079	$	16,432	$	50,707	$	48,737

Reconciliation to Consolidated Financial Information

A reconciliation of the reportable segment operating revenues to consolidated operating revenues is as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(dollars in millions)	2021		2020		2021		2020
Total reportable segment operating revenues	$	31,017	$	29,485	$	92,835	$	87,526
Corporate and other	2,009		2,203		7,093		6,442
Eliminations	(111)		(145)		(382)		(368)
Total consolidated operating revenues	$	32,915	$	31,543	$	99,546	$	93,600

A reconciliation of the total reportable segment's operating income to consolidated income before provision for income taxes is as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(dollars in millions)	2021		2020		2021		2020
Total reportable segment operating income	$	8,476	$	8,360	$	25,247	$	24,606
Corporate and other	621		(479)		392		(1,183)
Other components of net periodic benefit charges (Note 9)	(192)		(203)		(576)		(610)
Loss on spectrum licenses (Note 3)	—		—		(223)		(1,195)
Total consolidated operating income	8,905		7,678		24,840		21,618
Equity in earnings (losses) of unconsolidated businesses	1		(9)		10		(34)
Other income (expense), net	269		(774)		1,172		(703)
Interest expense	(801)		(1,044)		(2,746)		(3,167)
Income Before Provision For Income Taxes	$	8,374	$	5,851	$	23,276	$	17,714

No single customer accounted for more than 10% of our total operating revenues during the three and nine months ended September 30, 2021 or 2020.

The chief operating decision maker does not review disaggregated assets on a segment basis; therefore, such information is not presented. Depreciation included in the measure of segment profitability is primarily allocated based on proportional usage.