Financial Data
AT&T Inc.
Consolidated Statements of Income
Dollars in millions except per share amounts
Unaudited	Three Months Ended										Six Months Ended
		6/30/2010			6/30/2009			% Chg			6/30/2010			6/30/2009			% Chg
Operating Revenues
Wireless service		$	13,186		$	11,960			10.3	%	$	26,036		$	23,606			10.3	%
Voice			7,219			8,255			-12.5	%		14,698			16,758			-12.3	%
Data			6,848			6,323			8.3	%		13,479			12,605			6.9	%
Directory			1,007			1,211			-16.8	%		2,048			2,460			-16.7	%
Other			2,548			2,865			-11.1	%		5,077			5,642			-10.0	%
Total Operating Revenues			30,808			30,614			0.6	%		61,338			61,071			0.4	%
Operating Expenses
Cost of services and sales (exclusive of
depreciation and amortization shown separately below)			12,381			12,557			-1.4	%		24,716			24,758			-0.2	%
Selling, general and administrative			7,475			7,682			-2.7	%		14,863			15,340			-3.1	%
Depreciation and amortization			4,838			4,875			-0.8	%		9,638			9,733			-1.0	%
Total Operating Expenses			24,694			25,114			-1.7	%		49,217			49,831			-1.2	%
Operating Income			6,114			5,500			11.2	%		12,121			11,240			7.8	%
Interest Expense			754			876			-13.9	%		1,519			1,722			-11.8	%
Equity in Net Income of Affiliates			195			231			-15.6	%		412			368			12.0	%
Other Income (Expense) - Net			723			30			-			700			15			-
Income from Continuing Operations Before Income Taxes			6,278			4,885			28.5	%		11,714			9,901			18.3	%
Income Taxes			2,173			1,612			34.8	%		5,048			3,423			47.5	%
Income from Continuing Operations			4,105			3,273			25.4	%		6,666			6,478			2.9	%
Income (Loss) from Discontinued Operations, net of tax			(4	)		3			-			(3	)		(1	)		-
Net Income			4,101			3,276			25.2	%		6,663			6,477			2.9	%
Less: Net Income Attributable to Noncontrolling Interest			(78	)		(78	)		0.0	%		(165	)		(153	)		-7.8	%
Net Income Attributable to AT&T		$	4,023		$	3,198			25.8	%	$	6,498		$	6,324			2.8	%
Basic Earnings Per Share from Continuing
Operations Attributable to AT&T		$	0.68		$	0.54			25.9	%	$	1.10		$	1.07			2.8	%
Basic Earnings Per Share from Discontinued
Operations Attributable to AT&T			-			-			-			-			-			-
Basic Earnings Per Share Attributable to AT&T		$	0.68		$	0.54			25.9	%	$	1.10		$	1.07			2.8	%
Weighted Average Common
Shares Outstanding (000,000)			5,909			5,900			0.2	%		5,907			5,898			0.2	%
Diluted Earnings Per Share from Continuing
Operations Attributable to AT&T		$	0.68		$	0.54			25.9	%	$	1.10		$	1.07			2.8	%
Diluted Earnings Per Share from Discontinued
Operations Attributable to AT&T			-			-			-			-			-			-
Diluted Earnings Per Share Attributable to AT&T		$	0.68		$	0.54			25.9	%	$	1.10		$	1.07			2.8	%
Weighted Average Common
Shares Outstanding with Dilution (000,000)			5,937			5,923			0.2	%		5,936			5,923			0.2	%

Financial Data
AT&T Inc.
Statements of Segment Income
Dollars in millions
Unaudited
	Three Months Ended									Six Months Ended
Wireless	6/30/2010			6/30/2009			% Chg			6/30/2010			6/30/2009			% Chg
Segment Operating Revenues
Service	$	13,186		$	11,960			10.3	%	$	26,036		$	23,606			10.3	%
Equipment		1,056			1,262			-16.3	%		2,103			2,454			-14.3	%
Total Segment Operating Revenues		14,242			13,222			7.7	%		28,139			26,060			8.0	%
Segment Operating Expenses
Operations and support		8,562			8,428			1.6	%		16,745			16,314			2.6	%
Depreciation and amortization		1,578			1,504			4.9	%		3,136			3,003			4.4	%
Total Segment Operating Expenses		10,140			9,932			2.1	%		19,881			19,317			2.9	%
Segment Operating Income		4,102			3,290			24.7	%		8,258			6,743			22.5	%
Equity in Net Income of Affiliates		7			-			-			20			-			-
Segment Income	$	4,109		$	3,290			24.9	%	$	8,278		$	6,743			22.8	%
Segment Operating Income Margin		28.8	%		24.9	%					29.3	%		25.9	%
Wireline
Segment Operating Revenues
Voice	$	7,219		$	8,255			-12.5	%	$	14,698		$	16,758			-12.3	%
Data		6,848			6,323			8.3	%		13,479			12,605			6.9	%
Other		1,329			1,411			-5.8	%		2,640			2,788			-5.3	%
Total Segment Operating Revenues		15,396			15,989			-3.7	%		30,817			32,151			-4.1	%
Segment Operating Expenses
Operations and support		10,389			10,924			-4.9	%		21,006			21,856			-3.9	%
Depreciation and amortization		3,123			3,194			-2.2	%		6,219			6,368			-2.3	%
Total Segment Operating Expenses		13,512			14,118			-4.3	%		27,225			28,224			-3.5	%
Segment Operating Income		1,884			1,871			0.7	%		3,592			3,927			-8.5	%
Equity in Net Income of Affiliates		-			4			-			5			7			-28.6	%
Segment Income	$	1,884		$	1,875			0.5	%	$	3,597		$	3,934			-8.6	%
Segment Operating Income Margin		12.2	%		11.7	%					11.7	%		12.2	%
Advertising Solutions
Segment Operating Revenues	$	1,007		$	1,211			-16.8	%	$	2,048		$	2,460			-16.7	%
Segment Operating Expenses
Operations and support		673			706			-4.7	%		1,348			1,427			-5.5	%
Depreciation and amortization		132			166			-20.5	%		270			342			-21.1	%
Total Segment Operating Expenses		805			872			-7.7	%		1,618			1,769			-8.5	%
Segment Operating Income		202			339			-40.4	%		430			691			-37.8	%
Equity in Net Income (Loss) of Affiliates		-			-			-			-			-			-
Segment Income	$	202		$	339			-40.4	%	$	430		$	691			-37.8	%
Segment Income Margin		20.1	%		28.0	%					21.0	%		28.1	%
Other
Segment Operating Revenues	$	163		$	192			-15.1	%	$	334		$	400			-16.5	%
Segment Operating Expenses		237			192			23.4	%		493			521			-5.4	%
Segment Operating Income (Loss)		(74	)		-			-			(159	)		(121	)		-31.4	%
Equity in Net Income of Affiliates		188			226			-16.8	%		387			360			7.5	%
Segment Income from Continuing Operations	$	114		$	226			-49.6	%	$	228		$	239			-4.6	%
Segment Income Margin		69.9	%		-						68.3	%		59.8	%

Financial Data
AT&T Inc.
Consolidated Balance Sheets
Dollars in millions except per share amounts
	6/30/10			12/31/09
	Unaudited
Assets
Current Assets
Cash and cash equivalents	$	1,377		$	3,741
Accounts receivable - net of allowances for
doubtful accounts of $1,084 and $1,202		13,780			14,845
Prepaid expenses		1,666			1,562
Deferred income taxes		1,225			1,247
Other current assets		3,344			3,792
Total current assets		21,392			25,187
Property, plant and equipment		236,187			230,295
Less: accumulated depreciation and amortization		(135,885	)		(130,242	)
Property, Plant and Equipment - Net		100,302			100,053
Goodwill		73,484			72,782
Licenses		49,957			48,741
Customer Lists and Relationships - Net		6,047			7,393
Other Intangible Assets - Net		5,539			5,494
Investments in Equity Affiliates		4,346			2,921
Other Assets		6,489			6,275
Total Assets	$	267,556		$	268,846
Liabilities and Stockholders' Equity
Current Liabilities
Debt maturing within one year	$	9,721		$	7,361
Accounts payable and accrued liabilities		18,157			21,260
Advanced billing and customer deposits		3,943			4,170
Accrued taxes		1,879			1,681
Dividends payable		2,482			2,479
Total current liabilities		36,182			36,951
Long-Term Debt		60,277			64,720
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes		25,615			23,781
Postemployment benefit obligation		27,421			27,847
Other noncurrent liabilities		14,578			13,226
Total deferred credits and other noncurrent liabilities		67,614			64,854
Stockholders' Equity
Common stock ($1 par value, 14,000,000,000 authorized
at June 30, 2010 and December 31, 2009: issued
6,495,231,088 at June 30, 2010 and December 31, 2009)		6,495			6,495
Additional paid-in capital		91,628			91,707
Retained earnings		40,909			39,366
Treasury stock (586,184,637 at June 30, 2010 and
593,300,187 at December 31, 2009, at cost)		(21,134	)		(21,260	)
Accumulated other comprehensive loss		(14,852	)		(14,412	)
Noncontrolling interest		437			425
Total stockholders' equity		103,483			102,321
Total Liabilities and Stockholders' Equity	$	267,556		$	268,846

Financial Data
AT&T Inc.
Consolidated Statements of Cash Flows
Dollars in millions, increase (decrease) in cash and cash equivalents
Unaudited
	Six months ended
	June 30,
	2010			2009
Operating Activities
Net income	$	6,663		$	6,477
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization		9,638			9,733
Undistributed earnings from investments in equity affiliates		(378	)		(339	)
Bad debt expense		671			975
Deferred income tax expense		2,076			746
Net (gain) loss from impairment and sale of investments		(641	)		92
Changes in operating assets and liabilities:
Accounts receivable		394			169
Other current assets		389			(58	)
Accounts payable and accrued liabilities		(3,063	)		(2,054	)
Net income attributable to noncontrolling interest		(165	)		(153	)
Other - net		226			184
Total Adjustments		9,147			9,295
Net Cash Provided by Operating Activities		15,810			15,772
Investing Activities
Construction and capital expenditures
Capital expenditures		(7,856	)		(7,017	)
Interest during construction		(379	)		(368	)
Acquisitions, net of cash acquired		(2,554	)		(55	)
Dispositions		14			199
(Purchases) and sales of securities, net		(545	)		4
Other		17			14
Net Cash Used in Investing Activities		(11,303	)		(7,223	)
Financing Activities
Net change in short-term borrowings with
original maturities of three months or less		3,280			(3,915	)
Issuance of long-term debt		-			8,161
Repayment of long-term debt		(4,661	)		(2,036	)
Issuance of treasury stock		5			4
Dividends paid		(4,960	)		(4,834	)
Other		(535	)		(381	)
Net Cash Used in Financing Activities		(6,871	)		(3,001	)
Net increase (decrease) in cash and cash equivalents		(2,364	)		5,548
Cash and cash equivalents beginning of year		3,741			1,727
Cash and Cash Equivalents End of Period	$	1,377		$	7,275

Financial Data
AT&T Inc.
Supplementary Operating and Financial Data
Dollars in millions except per share amounts
Unaudited	Three Months Ended									Six Months Ended
	6/30/2010			6/30/2009			% Chg			6/30/2010			6/30/2009			% Chg
Wireless
Wireless Customers (000)											90,130			79,600			13.2	%
Net Customer Additions (000)		1,562			1,368			14.2	%		3,419			2,591			32.0	%
M&A Activity, Partitioned Customers and Other Adjs. (000)		1,581			-						1,591			-
Total Churn7		1.29	%		1.48	%	-19 BP				1.29	%		1.52	%	-23 BP
Postpaid Customers (000)7											66,970			61,647			8.6	%
Net Postpaid Customer Additions (000)7		496			1,128			-56.0	%		1,008			2,025			-50.2	%
Postpaid Churn7		1.01	%		1.07	%	-6 BP				1.04	%		1.11	%	-7 BP
Licensed POPs (000,000)											307			306			0.3	%
Prepaid Customers (000)7											5,881			5,558			5.8	%
Net Prepaid Customer Additions (000)7		300			(412	)					324			(567	)
Connected Devices Customers (000)7											6,682			3,109
Net Connected Devices Customer Additions (000)7		896			304						1,948			448
In-Region Wireline 1
Total Consumer Revenue Connections (000)
Retail Consumer Voice Connections 2											25,780			29,047			-11.2	%
Consumer  Wired Broadband Connections 3											13,925			13,454			3.5	%
Video Connections: 4
Satellite Connections											2,053			2,210			-7.1	%
U-verse Video Connections											2,504			1,577			58.8	%
Total Consumer Revenue Connections (000)											44,262			46,288			-4.4	%
Net Consumer Revenue Connection Changes (000)		(782	)		(559	)		-39.9	%		(1,025	)		(755	)		-35.8	%
Broadband and Video
Total Broadband Connections (000) 5											17,439			16,945			2.9	%
Net Broadband Connection Changes (000) 5		(93	)		209						185			680			-72.8	%
Total Video Connections (000) 4											4,558			3,787			20.4	%
Net Video Connection Changes (000) 4		135			253			-46.6	%		319			552			-42.2	%
AT&T Inc.
Construction and capital expenditures
Capital expenditures	$	4,709		$	3,854			22.2	%	$	7,856		$	7,017			12.0	%
Interest during construction	$	195		$	183			6.6	%	$	379		$	368			3.0	%
Dividends Declared per Share	$	0.4200		$	0.4100			2.4	%	$	0.8400		$	0.8200			2.4	%
End of Period Common Shares Outstanding (000,000)											5,909			5,900			0.2	%
Debt Ratio 6											40.3	%		43.7	%	-340 BP
Total Employees											272,450			288,660			-5.6	%

1	In-region wireline represents access lines served by AT&T's incumbent local exchange companies.
2	Includes consumer U-verse Voice over IP connections.
3	Consumer Wired Broadband Connections include DSL lines, U-verse High Speed Internet access and satellite broadband.
4	Video connections include sales under agency agreements with EchoStar and DirecTV customers and U-verse connections.
5	Total broadband connections include DSL lines, U-verse High Speed Internet access, satellite broadband and 3G LaptopConnect cards.
6	Total long-term debt plus debt maturing within one year divided by total debt plus total stockholders' equity.
7	Prior year amounts restated to conform to current period reporting methodology.
	Note: For the end of 2Q10, total switched access lines were 46,558, retail business switched access lines totaled 19,465, and wholesale and coin switched access lines totaled 2,641. These include 1,725 retail business and 102 wholesale lines that are used solely by AT&T or our subsidiaries.