EX-99.1 2 ex99_1.htm AT&T INC. SELECTED FINANCIAL STATEMENTS AND OPERATING DATA.

AT&T Inc.

 

 

 

 

 

 

 

Financial Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated Statements of Income

Dollars in millions except per share amounts

 

 

 

Unaudited

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

Operating Revenues

 

 

 

 

 

 

 

  Service

$

38,883

$

40,684

 

(4.4)

%

  Equipment

 

3,896

 

4,143

 

(6.0)

%

    Total Operating Revenues

 

42,779

 

44,827

 

(4.6)

%

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

   Cost of revenues

 

 

 

 

 

 

 

    Equipment

 

4,092

 

4,502

 

(9.1)

%

    Broadcast, programming and operations

 

6,847

 

7,652

 

(10.5)

%

    Other cost of revenues (exclusive of depreciation

          and amortization shown separately below)

 

8,342

 

8,585

 

(2.8)

%

   Selling, general and administrative

 

8,790

 

9,649

 

(8.9)

%

   Depreciation and amortization

 

7,222

 

7,206

 

0.2

%

    Total Operating Expenses

 

35,293

 

37,594

 

(6.1)

%

Operating Income

 

7,486

 

7,233

 

3.5

%

Interest Expense

 

2,018

 

2,141

 

(5.7)

%

Equity in Net Income (Loss) of Affiliates

 

(6)

 

(7)

 

14.3

%

Other Income (Expense) - Net

 

803

 

286

 

-

%

Income Before Income Taxes

 

6,265

 

5,371

 

16.6

%

Income Tax Expense

 

1,302

 

1,023

 

27.3

%

Net Income

 

4,963

 

4,348

 

14.1

%

 Less: Net Income Attributable to

    Noncontrolling Interest

 

(353)

 

(252)

 

(40.1)

%

Net Income Attributable to AT&T

$

4,610

$

4,096

 

12.5

%

 Less: Preferred Stock Dividends

 

(32)

 

-

 

-

%

Net Income Attributable to Common Stock

$

4,578

$

4,096

 

11.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic Earnings Per Share Attributable to

    Common Stock

$

0.63

$

0.56

 

12.5

%

Weighted Average Common

    Shares Outstanding (000,000)

 

7,187

 

7,313

 

(1.7)

%

Diluted Earnings Per Share Attributable to

    Common Stock

$

0.63

$

0.56

 

12.5

%

Weighted Average Common 

    Shares Outstanding with Dilution (000,000)

 

7,214

 

7,342

 

(1.7)

%


1

AT&T Inc.

 

 

 

 

 

Financial Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated Balance Sheets

Dollars in millions

 

Unaudited

 

Mar. 31,

 

 

Dec. 31,

 

 

 

2020

 

 

2019

Assets

 

 

 

 

 

Current Assets

 

 

 

 

 

Cash and cash equivalents

$

9,955

 

$

12,130

Accounts receivable - net of allowances for doubtful accounts of $1,651 and $1,235

 

19,908

 

 

22,636

Prepaid expenses

 

1,600

 

 

1,631

Other current assets

 

21,241

 

 

18,364

Total current assets

 

52,704

 

 

54,761

Noncurrent Inventories and Theatrical Film and Television Production Costs

 

13,276

 

 

12,434

Property, Plant and Equipment – Net

 

128,921

 

 

130,128

Goodwill

 

145,546

 

 

146,241

Licenses – Net

 

96,662

 

 

97,907

Trademarks and Trade Names – Net

 

23,293

 

 

23,567

Distribution Networks – Net

 

14,886

 

 

15,345

Other Intangible Assets – Net

 

19,623

 

 

20,798

Investments in and Advances to Equity Affiliates

 

3,606

 

 

3,695

Operating Lease Right-of-Use Assets

 

24,008

 

 

24,039

Other Assets

 

22,829

 

 

22,754

Total Assets

$

545,354

 

$

551,669

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

Current Liabilities

 

 

 

 

 

Debt maturing within one year

$

17,067

 

$

11,838

Accounts payable and accrued liabilities

 

40,771

 

 

45,956

Advanced billings and customer deposits

 

5,960

 

 

6,124

Accrued taxes

 

2,169

 

 

1,212

Dividends payable

 

3,737

 

 

3,781

Total current liabilities

 

69,704

 

 

68,911

Long-Term Debt

 

147,202

 

 

151,309

Deferred Credits and Other Noncurrent Liabilities

 

 

 

 

 

Deferred income taxes

 

58,491

 

 

59,502

Postemployment benefit obligation

 

18,324

 

 

18,788

Operating lease liabilities

 

21,584

 

 

21,804

Other noncurrent liabilities

 

34,600

 

 

29,421

Total deferred credits and other noncurrent liabilities

 

132,999

 

 

129,515

Stockholders’ Equity

 

 

 

 

 

Preferred stock

-

 

 

-

Common stock

 

7,621

 

 

7,621

Additional paid-in capital

 

129,966

 

 

126,279

Retained earnings

 

58,534

 

 

57,936

Treasury stock

 

(17,957)

 

 

(13,085)

Accumulated other comprehensive income

 

(385)

 

 

5,470

Noncontrolling interest

 

17,670

 

 

17,713

Total stockholders’ equity

 

195,449

 

 

201,934

Total Liabilities and Stockholders' Equity

$

545,354

 

$

551,669

 

 

 

 

 

 

 

2

AT&T Inc.

 

 

 

 

 

Financial Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated Statements of Cash Flows

Dollars in millions

 

Unaudited

First Quarter

 

 

2020

 

 

2019

Operating Activities

 

 

 

 

 

Net income

$

4,963

 

$

4,348

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

7,222

 

 

7,206

 

Amortization of film and television costs

 

2,269

 

 

2,497

 

Undistributed earnings from investments in equity affiliates

 

39

 

 

112

 

Provision for uncollectible accounts

 

780

 

 

592

 

Deferred income tax expense (benefit)

 

259

 

 

753

 

Net (gain) loss on investments, net of impairments

 

(646)

 

 

(175)

 

Pension and postiretirement benefit expense (credit)

 

(748)

 

 

(369)

 

Actuarial (gain) loss on pension and postretirement benefits

 

-

 

 

432

Changes in operating assets and liabilities:

 

 

 

 

 

 

Receivables

 

1,695

 

 

2,125

 

Other current assets, inventories and theatrical film and television production costs

 

(3,267)

 

 

(2,510)

 

Accounts payable and other accrued liabilities

 

(3,884)

 

 

(3,686)

 

Equipment installment receivables and related sales

 

535

 

 

652

 

Deferred customer contract acquisition and fulfillment costs

 

105

 

 

(375)

Postretirement claims and contributions

 

(111)

 

 

(193)

Other - net

 

(345)

 

 

(357)

Total adjustments

 

3,903

 

 

6,704

Net Cash Provided by Operating Activities

 

8,866

 

 

11,052

 

 

 

 

 

Investing Activities

 

 

 

 

 

Capital expenditures:

 

 

 

 

 

 

Purchase of property and equipment

 

(4,938)

 

 

(5,121)

 

Interest during construction

 

(28)

 

 

(61)

Acquisitions, net of cash acquired

 

(100)

 

 

(117)

Dispositions

 

118

 

 

10

(Purchases), sales and settlement of securities and investments, net

 

(6)

 

 

(1)

Advances to and investments in equity affiliates, net

 

(68)

 

 

(111)

Net Cash Used in Investing Activities

 

(5,022)

 

 

(5,401)

 

 

 

 

 

 

Financing Activities

 

 

 

 

 

Net change in short-term borrowings with original maturities of three months or less

 

1,742

 

 

(256)

Issuance of other short-term borrowings

 

1,390

 

 

296

Repayment of other short-term borrowings

 

-

 

 

(176)

Issuance of long-term debt

 

4,357

 

 

9,182

Repayment of long-term debt

 

(4,422)

 

 

(9,840)

Payment of vendor financing

 

(791)

 

 

(819)

Issuance of preferred stock

 

3,869

 

 

-

Purchase of treasury stock

 

(5,463)

 

 

(189)

Issuance of treasury stock

 

58

 

 

167

Dividends paid

 

(3,737)

 

 

(3,714)

Other

 

(3,102)

 

 

928

Net Cash Used in Financing Activities

 

(6,099)

 

 

(4,421)

Net (decrease) increase in cash and cash equivalents and restricted cash

 

(2,255)

 

 

1,230

Cash and cash equivalents and restricted cash beginning of year

 

12,295

 

 

5,400

Cash and Cash Equivalents and Restricted Cash End of Period

$

10,040

 

$

6,630

 

 

 

 

 

 

3


AT&T Inc.

Consolidated Supplementary Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplementary Financial Data

Dollars in millions except per share amounts

 

 

 

 

 

 

 

Unaudited

 

 

 

First Quarter

Percent

 

 

 

 

 

 

 

 

 

 

2020

 

2019

 

Change

Capital expenditures

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchase of property and equipment

 

 

 

 

 

 

 

 

$

4,938

$

5,121

 

(3.6)

%

 

Interest during construction

 

 

 

 

 

 

 

 

 

28

 

61

 

(54.1)

%

Total Capital Expenditures

 

 

 

 

 

 

 

 

$

4,966

$

5,182

 

(4.2)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends Declared per Common Share

 

 

 

 

 

 

 

 

$

0.52

$

0.51

 

2.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

End of Period Common Shares Outstanding (000,000)

 

 

 

 

 

 

 

 

 

7,125

 

7,297

 

(2.4)

%

Debt Ratio

 

 

 

 

 

 

 

 

 

45.7

%

47.4

%

(170)

BP

Total Employees

 

 

 

 

 

 

 

 

 

244,490

 

262,290

 

(6.8)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplementary Operating Data

Subscribers and connections in thousands

 

 

 

 

 

 

 

 

Unaudited

 

 

 

 

 

March 31,

Percent

 

 

 

 

 

 

 

 

 

 

 

2020

 

2019

 

Change

Broadband Connections

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

IP

 

 

 

 

 

 

 

 

 

14,627

 

14,852

 

(1.5)

%

 

DSL

 

 

 

 

 

 

 

 

 

688

 

885

 

(22.3)

%

Total Broadband Connections

 

 

 

 

 

 

 

 

 

15,315

 

15,737

 

(2.7)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Voice Connections

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Network Access Lines

 

 

 

 

 

 

 

 

 

8,160

 

9,587

 

(14.9)

%

 

U-verse VoIP Connections

 

 

 

 

 

 

 

 

 

4,213

 

4,935

 

(14.6)

%

Total Retail Voice Connections

 

 

 

 

 

 

 

 

 

12,373

 

14,522

 

(14.8)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

First Quarter

Percent

 

 

 

 

 

 

 

 

 

 

2020

 

2019

 

Change

Broadband Net Additions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

IP

 

 

 

 

 

 

 

 

 

(32)

 

100

 

-

%

 

DSL

 

 

 

 

 

 

 

 

 

(42)

 

(64)

 

34.4

%

Total Broadband Net Additions

 

 

 

 

 

 

 

 

 

(74)

 

36

 

-

%

4

COMMUNICATIONS SEGMENT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Communications segment provides wireless and wireline telecom, video and broadband services to consumers located in the U.S. and businesses globally. The Communications segment contains three reporting units: Mobility, Entertainment Group, and Business Wireline.

 

 

 

 

 

 

 

 

Segment Results

Dollars in millions

 

 

 

Unaudited

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

Segment Operating Revenues

 

 

 

 

 

 

 

 

Mobility

 $  

17,402

 $  

17,363

 

0.2

 %  

 

Entertainment Group

 

10,515

 

11,328

 

(7.2)

%

 

Business Wireline

 

6,332

 

6,478

 

(2.3)

 %  

    Total Segment Operating Revenues

 

34,249

 

35,169

 

(2.6)

%

 

 

 

 

 

 

 

 

 

Segment Operating Contribution

 

 

 

 

 

 

 

 

Mobility

 

5,788

 

5,309

 

9.0

 %  

 

Entertainment Group

 

1,335

 

1,478

 

(9.7)

%

 

Business Wireline

 

1,080

 

1,224

 

(11.8)

 %  

    Total Segment Operating Contribution

$

8,203

$

8,011

 

2.4

%

 

 

 

 

 

 

 

 

 

 

5

Mobility

 

 

 

 

 

 

 

 

 

Mobility provides nationwide wireless service and equipment.

 

 

 

 

 

 

 

 

 

Mobility Results

Dollars in millions

 

 

 

Unaudited

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

Operating Revenues

 

 

 

 

 

 

 

Service

 $  

13,968

 $  

13,629

 

2.5

 %  

Equipment

 

3,434

 

3,734

 

(8.0)

%

    Total Operating Revenues

 

17,402

 

17,363

 

0.2

 %  

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

Operations and support

 

9,569

 

10,041

 

(4.7)

%

Depreciation and amortization

 

2,045

 

2,013

 

1.6

 %  

    Total Operating Expenses

 

11,614

 

12,054

 

(3.7)

%

Operating Income

 

5,788

 

5,309

 

9.0

 %  

Equity in Net Income (Loss) of Affiliates

 

-

 

-

 

-

%

Operating Contribution

$

5,788

$

5,309

 

9.0

 %  

 

 

 

 

 

 

 

 

 

Operating Income Margin

 

33.3

%

30.6

%

270

BP

 

 

 

 

 

 

 

 

 

Supplementary Operating Data

Subscribers and connections in thousands

 

 

 

 

Unaudited

March 31,

Percent

 

 

 

2020

 

2019

 

Change

Mobility Subscribers

 

 

 

 

 

 

 

Postpaid

 

75,148

 

75,737

 

(0.8)

%

Prepaid

 

17,808

 

17,012

 

4.7

%

Reseller

 

6,736

 

7,495

 

(10.1)

%

Connected Devices

 

69,506

 

54,426

 

27.7

%

Total Mobility Subscribers

 

169,198

 

154,670

 

9.4

%

 

 

 

 

 

 

 

 

 

Postpaid Phone Subscribers

 

63,105

 

62,830

 

0.4

%

Total Phone Subscribers

 

79,792

 

78,887

 

1.1

%

 

 

 

 

 

 

 

 

 

 

 

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

Mobility Net Additions

 

 

 

 

 

 

 

Postpaid

 

27

 

(207)

 

-

%

Prepaid

 

(45)

 

101

 

-

%

Reseller

 

(190)

 

(242)

 

21.5

%

Connected Devices

 

3,518

 

3,088

 

13.9

%

Total Mobility Net Additions

 

3,310

 

2,740

 

20.8

%

 

 

 

 

 

 

 

 

Postpaid Phone Net Additions

 

163

 

79

 

-

%

Total Phone Net Additions

 

120

 

168

 

(28.6)

%

 

 

 

 

 

 

 

 

Postpaid Churn

 

1.08

%

1.16

%

(8)

BP

Postpaid Phone-Only Churn

 

0.86

%

0.92

%

(6)

BP

6

Entertainment Group

 

 

 

Entertainment Group provides video, including over-the-top (OTT) services, broadband and voice communication services primarily to residential customers. This business unit also sells advertising on video distribution platforms.

 
 

 

 

Entertainment Group Results

 

Dollars in millions

 

 

 

 

Unaudited

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

 

 Operating Revenues

 

 

 

 

 

 

 

 

Video entertainment

$

7,395

$

8,074

 

(8.4)

%

 

High-speed internet

 

2,109

 

2,070

 

1.9

%

 

Legacy voice and data services

 

581

 

683

 

(14.9)

%

 

Other service and equipment

 

430

 

501

 

(14.2)

%

 

Total Operating Revenues

 

10,515

 

11,328

 

(7.2)

%

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

Operations and support

 

7,891

 

8,527

 

(7.5)

%

 

Depreciation and amortization

 

1,289

 

1,323

 

(2.6)

%

 

Total Operating Expenses

 

9,180

 

9,850

 

(6.8)

%

 

Operating Income

 

1,335

 

1,478

 

(9.7)

%

 

Equity in Net Income (Loss) of Affiliates

 

-

 

-

 

-

%

 

Operating Contribution

$

1,335

$

1,478

 

(9.7)

%

 

 

 

 

 

 

 

 

 

 

Operating Income Margin

 

12.7

%

13.0

%

(30)

BP

 

 

 

 

 

 

 

 

 

 

Supplementary Operating Data

 

Subscribers and connections in thousands

 

 

 

 

Unaudited

March 31,

Percent

 

 

 

2020

 

2019

 

Change

 

Video Connections

 

 

 

 

 

 

 

 

Premium TV

 

18,576

 

22,359

 

(16.9)

%

 

AT&T TV Now

 

788

 

1,508

 

(47.7)

%

 

Total Video Connections

 

19,364

 

23,867

 

(18.9)

%

 

 

 

 

 

 

 

 

 

 

Broadband Connections

 

 

 

 

 

 

 

 

IP

 

13,554

 

13,822

 

(1.9)

%

 

DSL

 

492

 

632

 

(22.2)

%

 

Total Broadband Connections

 

14,046

 

14,454

 

(2.8)

%

 

Fiber Broadband Connections (included in IP)

 

4,096

 

3,060

 

33.9

%

 

 

 

 

 

 

 

 

 

 

Voice Connections

 

 

 

 

 

 

 

 

Retail Consumer Switched Access Lines

 

3,196

 

3,787

 

(15.6)

%

 

U-verse Consumer VoIP Connections

 

3,630

 

4,393

 

(17.4)

%

 

Total Retail Consumer Voice Connections

 

6,826

 

8,180

 

(16.6)

%

 

 

 

 

 

 

 

 

 

 

 

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

 

Video Net Additions

 

 

 

 

 

 

 

 

Premium TV

 

(897)

 

(544)

 

(64.9)

%

 

AT&T TV Now

 

(138)

 

(83)

 

(66.3)

%

 

Total Video Net Additions

 

(1,035)

 

(627)

 

(65.1)

%

 

 

 

 

 

 

 

 

 

 

Broadband Net Additions

 

 

 

 

 

 

 

 

IP

 

(44)

 

93

 

-

%

 

DSL

 

(29)

 

(48)

 

39.6

%

 

Total Broadband Net Additions

 

(73)

 

45

 

-

%

 

Fiber Broadband Net Additions (included in IP)

 

209

 

297

 

(29.6)

%

 
7


Business Wireline

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Wireline unit provides advanced IP-based services, as well as traditional data services to business customers.

 

 

 

 

 

 

 

 

 

Business Wireline Results

Dollars in millions

 

 

 

Unaudited

First Quarter

Percent

 

 

2020

 

2019

 

Change

Operating Revenues

 

 

 

 

 

 

 

 

Strategic and managed services

 $  

3,879

 $  

3,779

 

2.6

 %  

 

Legacy voice and data services

 

2,129

 

2,397

 

(11.2)

%

 

Other service and equipment

 

324

 

302

 

7.3

 %  

    Total Operating Revenues

 

6,332

 

6,478

 

(2.3)

%

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

Operations and support

 

3,951

 

4,032

 

(2.0)

 %  

Depreciation and amortization

 

1,301

 

1,222

 

6.5

%

    Total Operating Expenses

 

5,252

 

5,254

 

-

 %  

Operating Income

 

1,080

 

1,224

 

(11.8)

%

Equity in Net Income (Loss) of Affiliates

 

-

 

-

 

-

 %  

Operating Contribution

$

1,080

$

1,224

 

(11.8)

%

 

 

 

 

 

 

 

 

Operating Income Margin

 

17.1

%

18.9

%

(180)

BP

 

 

 

 

 

 

 

 

 

 

Business Solutions

 

 

 

 

 

 

 

 

As a supplemental presentation to our Communications segment operating results, we are providing a view of our AT&T Business Solutions results which includes both wireless and fixed operations. This combined view presents a complete profile of the entire business customer relationship and underscores the importance of mobile solutions to serving our business customers. Results have been recast to conform to the current period's classification of consumer and business wireless subscribers.

 
 
 

 

 

 

 

 

 

 

 

 

 

Business Solutions Results

 

Dollars in millions

 

 

 

 

Unaudited

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

 

Operating Revenues

 

 

 

 

 

 

 

 

 

Wireless service

 $  

1,949

 $  

1,777

 

9.7

 %  

 

 

Strategic and managed services

 

3,879

 

3,779

 

2.6

%

 

 

Legacy voice and data services

 

2,129

 

2,397

 

(11.2)

 %  

 

 

Other service and equipment

 

324

 

302

 

7.3

%

 

 

Wireless equipment

 

710

 

590

 

20.3

 %  

 

    Total Operating Revenues

 

8,991

 

8,845

 

1.7

%

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

Operations and support

 

5,710

 

5,614

 

1.7

 %  

 

Depreciation and amortization

 

1,625

 

1,525

 

6.6

%

 

    Total Operating Expenses

 

7,335

 

7,139

 

2.7

 %  

 

Operating Income

 

1,656

 

1,706

 

(2.9)

%

 

Equity in Net Income (Loss) of Affiliates

 

-

 

-

 

-

 %  

 

Operating Contribution

$

1,656

$

1,706

 

(2.9)

%

 

 

 

 

 

 

 

 

 

 

Operating Income Margin

 

18.4

%

19.3

%

(90)

BP

 

8


WARNERMEDIA  SEGMENT

 

 

 

 

 

 

 

 

 

The WarnerMedia segment develops, produces and distributes feature films, television, gaming and other content in various physical and digital formats globally. Results from Turner, Home Box Office and Warner Bros. businesses are combined with AT&T's Regional Sports Network (RSN) and Otter Media Holdings in the WarnerMedia segment.

 

Segment Results

Dollars in millions

 

 

 

Unaudited

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

Segment Operating Revenues

 

 

 

 

 

 

 

 

Turner

$

3,162

 $  

3,443

 

(8.2)

 %  

 

HBO

 

1,497

 

1,510

 

(0.9)

%

 

Warner Bros.

 

3,240

 

3,518

 

(7.9)

 %  

 

Eliminations and other

 

(540)

 

(92)

 

-

%

    Total Segment Operating Revenues

 

7,359

 

8,379

 

(12.2)

 %  

 

 

 

 

 

 

 

 

 

Cost of revenues

 

 

 

 

 

 

 

 

Turner

 

1,320

 

1,680

 

(21.4)

 %  

 

HBO

 

816

 

670

 

21.8

%

 

Warner Bros.

 

2,346

 

2,430

 

(3.5)

 %  

Selling, general and administrative

 

1,354

 

1,284

 

5.5

%

Eliminations and other

 

(319)

 

(71)

 

-

 %  

Depreciation and amortization

 

143

 

143

 

-

%

Total Operating Expenses

 

5,660

 

6,136

 

(7.8)

 %  

Operating Income

 

1,699

 

2,243

 

(24.3)

%

Equity in Net Income of Affiliates

 

15

 

67

 

(77.6)

 %  

    Total Segment Operating Contribution

$

1,714

$

2,310

 

(25.8)

%

 

 

 

 

 

 

 

 

 

Turner

 

 

 

Turner creates and programs branded news, entertainment, sports and kids multi-platform content that is sold to various distribution affiliates. Turner also sells advertising on its networks and digital properties.

 
 

 

 

Turner Results

 

Dollars in millions

 

 

 

 

Unaudited

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

 

Operating Revenues

 

 

 

 

 

  

 

 

 

Subscription

$

2,049

$

1,965

 

4.3

 %  

 

 

Advertising

 

957

 

1,261

 

(24.1)

%

 

 

Content and other

 

156

 

217

 

(28.1)

 %  

 

    Total Operating Revenues

 

3,162

 

3,443

 

(8.2)

%

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

 

Cost of revenues

 

1,320

 

1,680

 

(21.4)

 %  

 

 

Selling, general and administrative

 

390

 

456

 

(14.5)

%

 

 

Depreciation and amortization

 

69

 

60

 

15.0

 %  

 

    Total Operating Expenses

 

1,779

 

2,196

 

(19.0)

%

 

Operating Income

 

1,383

 

1,247

 

10.9

 %  

 

Equity in Net Income of Affiliates

 

6

 

25

 

(76.0)

%

 

Operating Contribution

$

1,389

$

1,272

 

9.2

 %  

 

 

 

 

 

 

 

 

 

 

Operating Income Margin

 

43.7

%

36.2

%

750

BP

 

9


Home Box Office

 

 

 

 

 

 

 

 

 

 

Home Box Office consists of premium pay television and OTT services domestically and premium pay, basic tier television and OTT services internationally, as well as content licensing and home entertainment.

 
 

 

 

Home Box Office Results

 

Dollars in millions

 

 

 

 

Unaudited

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

 

Operating Revenues

 

 

 

 

 

  

 

 

 

Subscription

$

1,338

$

1,334

 

0.3

 %  

 

 

Content and other

 

159

 

176

 

(9.7)

%

 

Total Operating Revenues

 

1,497

 

1,510

 

(0.9)

 %  

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

 

Cost of revenues

 

816

 

670

 

21.8

 %  

 

 

Selling, general and administrative

 

237

 

251

 

(5.6)

%

 

 

Depreciation and amortization

 

21

 

22

 

(4.5)

 %  

 

  Total Operating Expenses

 

1,074

 

943

 

13.9

%

 

Operating Income

 

423

 

567

 

(25.4)

 %  

 

Equity in Net Income of Affiliates

 

20

 

15

 

33.3

%

 

Operating Contribution

$

443

$

582

 

(23.9)

 %  

 

 

 

 

 

 

 

 

 

 

Operating Income Margin

 

28.3

%

37.5

%

(920)

BP

 


Warner Bros.

 

 

 

Warner Bros. consists of the production, distribution and licensing of television programming and feature films, the distribution of home entertainment products and the production and distribution of games.

 
 

 

 

Warner Bros. Results

 

Dollars in millions

 

 

 

 

Unaudited

First Quarter

Percent

 

 

 

 

2020

 

2019

 

Change

 

Operating Revenues

 

 

 

 

 

  

 

 

 

Theatrical product

$

1,106

$

1,506

 

(26.6)

 %  

 

 

Television product

 

1,769

 

1,613

 

9.7

%

 

 

Video games and other

 

365

 

399

 

(8.5)

 %  

 

    Total Operating Revenues

 

3,240

 

3,518

 

(7.9)

%

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

 

Cost of revenues

 

2,346

 

2,430

 

(3.5)

 %  

 

 

Selling, general and administrative

 

604

 

489

 

23.5

%

 

 

Depreciation and amortization

 

41

 

52

 

(21.2)

 %  

 

    Total Operating Expenses

 

2,991

 

2,971

 

0.7

%

 

Operating Income

 

249

 

547

 

(54.5)

 %  

 

Equity in Net Income (Loss) of Affiliates

 

(8)

 

6

 

-

%

 

Operating Contribution

$

241

$

553

 

(56.4)

 %  

 

 

 

 

 

 

 

 

 

 

Operating Income Margin

 

7.7

%

15.5

%

(780)

BP

 

 

10

LATIN AMERICA SEGMENT

 

The Latin America segment provides entertainment and wireless service outside of the U.S. Our international subsidiaries conduct business in their local currency and operating results are converted to U.S. dollars using official exchange rates. The Latin America segment contains two business units: Vrio and Mexico.

 

Segment Results

Dollars in millions

 

 

 

Unaudited

First Quarter

Percent

 

 

 

2020

 

2019

 

Change

Segment Operating Revenues

 

 

 

 

 

 

 

 

Vrio

$

887

 $  

1,067

 

(16.9)

 %  

 

Mexico

 

703

 

651

 

8.0

%

    Total Segment Operating Revenues

 

1,590

 

1,718

 

(7.5)

 %  

 

 

 

 

 

 

 

 

Segment Operating Contribution

 

 

 

 

 

 

 

 

Vrio

 

(39)

 

32

 

-

%

 

Mexico

 

(145)

 

(205)

 

29.3

 %  

    Total Segment Operating Contribution

$

(184)

$

(173)

 

(6.4)

%

 

 

 

 

 

 

 

 


Mexico

 

 Mexico provides wireless services and equipment to customers in Mexico.

 

Mexico Results

Dollars in millions

 

 

 

Unaudited

First Quarter

Percent

 

2020

2019

Change

Operating Revenues

 

 

 

 

 

  

 

Wireless service

$

467

$

442

 

5.7

%

Wireless equipment

 

236

 

209

 

12.9

%

    Total Operating Revenues

 

703

 

651

 

8.0

 %  

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

Operations and support

 

714

 

725

 

(1.5)

%

Depreciation and amortization

 

134

 

131

 

2.3

 %  

    Total Operating Expenses

 

848

 

856

 

(0.9)

%

Operating Income (Loss)

 

(145)

 

(205)

 

29.3

 %  

Equity in Net Income of Affiliates

 

-

 

-

 

-

%

Operating Contribution

$

(145)

$

(205)

 

29.3

 %  

 

 

 

 

 

 

 

 

Operating Income Margin

 

(20.6)

%

(31.5)

%

1,090

 BP  

 

 

 

 

 

 

 

 

Supplementary Operating Data

Subscribers and connections in thousands

 

 

 

 

Unaudited

March 31,

Percent

 

2020

2019

Change

Mexico Wireless Subscribers

 

 

 

 

 

 

 

Postpaid

 

4,962

 

5,642

 

(12.1)

 %  

Prepaid

 

13,692

 

11,779

 

16.2

%

Reseller

 

504

 

301

 

67.4

 %  

Total Mexico Wireless Subscribers

 

19,158

 

17,722

 

8.1

%

 

 

 

 

 

 

 

 

 

First Quarter

Percent

 

2020

2019

 

Change

Mexico Wireless Net Additions

 

 

 

 

 

 

 

Postpaid

 

(141)

 

(69)

 

-

 %  

Prepaid

 

108

 

114

 

(5.3)

%

Reseller

 

32

 

48

 

(33.3)

 %  

Total Mexico Wireless Net Subscriber Additions

 

(1)

 

93

 

-

%

 

 

 

 

 

 

 

 

11

Vrio

 

 

 

 

 

 

 

 

Vrio provides entertainment services to customers utilizing satellite technology in Latin America and the Caribbean.

 

Vrio Results

Dollars in millions

 

 

 

Unaudited

First Quarter

Percent

 

2020

2019

Change

Operating Revenues

$

887

$

1,067

 

(16.9)

 %  

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

Operations and support

 

783

 

866

 

(9.6)

%

Depreciation and amortization

 

147

 

169

 

(13.0)

 %  

Total Operating Expenses

 

930

 

1,035

 

(10.1)

%

Operating Income

 

(43)

 

32

 

-

 %  

Equity in Net Income of Affiliates

 

4

 

-

 

-

%

Operating Contribution

$

(39)

$

32

 

-

 %  

 

 

 

 

 

 

 

 

Operating Income Margin

 

(4.8)

%

3.0

%

(780)

 BP  

 

 

 

 

 

 

 

 

Supplementary Operating Data

Subscribers and connections in thousands

 

 

 

 

Unaudited

March 31,

Percent

 

2020

2019

Change

Vrio Video Subscribers

 

13,217

 

13,584

 

(2.7)

 %  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

First Quarter

Percent

 

2020

2019

Change

Vrio Video Net Subscriber Additions

 

(114)

 

(32)

 

-

 %  

 

 

 

 

 

 

 

 

 

XANDR SEGMENT

 

 

 

The Xandr segment provides advertising services. These services utilize data insights to develop higher value targeted advertising. Certain revenues in this segment are also reported by the Communications segment and are eliminated upon consolidation.

 
 

 

 

Segment Operating Results

 

Dollars in millions

 

 

 

 

 

 

 

 

Unaudited

 

 

 

First Quarter

Percent

 

 

 

 

 

 

 

 

 

 

2020

 

2019

 

Change

 

Segment Operating Revenues

 

 

 

 

 

 

 

 

$

489

$

426

 

14.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Operating Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operations and support

 

 

 

 

 

 

 

 

 

170

 

160

 

6.3

%

 

Depreciation and amortization

 

 

 

 

 

 

 

 

 

20

 

13

 

53.8

%

 

    Total Segment Operating Expenses

 

 

 

 

 

 

 

 

 

190

 

173

 

9.8

%

 

Operating Income

 

 

 

 

 

 

 

 

 

299

 

253

 

18.2

%

 

Equity in Net Income of Affiliates

 

 

 

 

 

 

 

 

 

-

 

-

 

-

%

 

Segment Operating Contribution

 

 

 

 

 

 

 

 

$

299

$

253

 

18.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Operating Income Margin

 

 

 

 

 

 

 

 

 

61.1

%

59.4

%

170

BP

 

12

Supplemental AT&T Advertising Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As a supplemental presentation to our Xandr segment operating results, we are providing a view of total advertising revenues generated by AT&T, which combines the advertising revenues recorded across all operating segments. This combined view presents the entire portfolio of revenues generated from AT&T assets and represents a significant strategic initiative and growth opportunity for AT&T.

 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advertising Revenues

 

Dollars in millions

 

 

 

 

 

 

 

 

Unaudited

 

 

 

First Quarter

Percent

 

 

 

 

 

 

 

 

 

 

 

2020

 

2019

 

Change

 

Operating Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

 

WarnerMedia

 

 

 

 

 

 

 

 

$

979

$

1,279

 

(23.5)

 %  

 

 

Communications

 

 

 

 

 

 

 

 

 

489

 

417

 

17.3

%

 

 

Xandr

 

 

 

 

 

 

 

 

 

489

 

426

 

14.8

 %  

 

 

Eliminations

 

 

 

 

 

 

 

 

 

(413)

 

(350)

 

(18.0)

%

 

    Total Advertising Revenues

 

 

 

 

 

 

 

 

$

1,544

$

1,772

 

(12.9)

 %  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13

SUPPLEMENTAL SEGMENT RECONCILIATION

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

Dollars in millions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unaudited

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

 

Operations and Support Expenses

 

 

EBITDA

 

 

Depreciation and Amortization

 

 

Operating Income (Loss)

 

 

Equity in Net Income (Loss) of Affiliates

 

 

Segment Contribution

Communications

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Mobility

$

17,402

 

$

9,569

 

$

7,833

 

$

2,045

 

$

5,788

 

$

-

 

$

5,788

  Entertainment Group

 

10,515

 

 

7,891

 

 

2,624

 

 

1,289

 

 

1,335

 

 

-

 

 

1,335

  Business Wireline

 

6,332

 

 

3,951

 

 

2,381

 

 

1,301

 

 

1,080

 

 

-

 

 

1,080

Total Communications

 

34,249

 

 

21,411

 

 

12,838

 

 

4,635

 

 

8,203

 

 

-

 

 

8,203

WarnerMedia

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Turner

 

3,162

 

 

1,710

 

 

1,452

 

 

69

 

 

1,383

 

 

6

 

 

1,389

  Home Box Office

 

1,497

 

 

1,053

 

 

444

 

 

21

 

 

423

 

 

20

 

 

443

  Warner Bros.

 

3,240

 

 

2,950

 

 

290

 

 

41

 

 

249

 

 

(8)

 

 

241

  Eliminations and other

 

(540)

 

 

(196)

 

 

(344)

 

 

12

 

 

(356)

 

 

(3)

 

 

(359)

Total WarnerMedia

 

7,359

 

 

5,517

 

 

1,842

 

 

143

 

 

1,699

 

 

15

 

 

1,714

Latin America

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Vrio

 

887

 

 

783

 

 

104

 

 

147

 

 

(43)

 

 

4

 

 

(39)

  Mexico

 

703

 

 

714

 

 

(11)

 

 

134

 

 

(145)

 

 

-

 

 

(145)

Total Latin America

 

1,590

 

 

1,497

 

 

93

 

 

281

 

 

(188)

 

 

4

 

 

(184)

Xandr

 

489

 

 

170

 

 

319

 

 

20

 

 

299

 

 

-

 

 

299

Segment Total

 

43,687

 

 

28,595

 

 

15,092

 

 

5,079

 

 

10,013

 

$

19

 

$

10,032

Corporate and Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Corporate

 

388

 

 

874

 

 

(486)

 

 

87

 

 

(573)

 

 

 

 

 

 

  Acquisition-related items

 

-

 

 

182

 

 

(182)

 

 

2,056

 

 

(2,238)

 

 

 

 

 

 

  Certain significant items

 

-

 

 

(658)

 

 

658

 

 

-

 

 

658

 

 

 

 

 

 

  Eliminations and consolidations

 

(1,296)

 

 

(922)

 

 

(374)

 

 

-

 

 

(374)

 

 

 

 

 

 

AT&T Inc.

$

42,779

 

$

28,071

 

$

14,708

 

$

7,222

 

$

7,486

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

 

Operations and Support Expenses

 

 

EBITDA

 

 

Depreciation and Amortization

 

 

Operating Income (Loss)

 

 

Equity in Net Income (Loss) of Affiliates

 

 

Segment Contribution

Communications

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Mobility

$

17,363

 

 $  

10,041

 

$

7,322

 

$

2,013

 

$

5,309

 

$

-

 

$

5,309

  Entertainment Group

 

11,328

 

 

8,527

 

 

2,801

 

 

1,323

 

 

1,478

 

 

-

 

 

1,478

  Business Wireline

 

6,478

 

 

4,032

 

 

2,446

 

 

1,222

 

 

1,224

 

 

-

 

 

1,224

Total Communications

 

35,169

 

 

22,600

 

 

12,569

 

 

4,558

 

 

8,011

 

 

-

 

 

8,011

WarnerMedia

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Turner

 

3,443

 

 

2,136

 

 

1,307

 

 

60

 

 

1,247

 

 

25

 

 

1,272

  Home Box Office

 

1,510

 

 

921

 

 

589

 

 

22

 

 

567

 

 

15

 

 

582

  Warner Bros.

 

3,518

 

 

2,919

 

 

599

 

 

52

 

 

547

 

 

6

 

 

553

  Eliminations and other

 

(92)

 

 

17

 

 

(109)

 

 

9

 

 

(118)

 

 

21

 

 

(97)

Total WarnerMedia

 

8,379

 

 

5,993

 

 

2,386

 

 

143

 

 

2,243

 

 

67

 

 

2,310

Latin America

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Vrio

 

1,067

 

 

866

 

 

201

 

 

169

 

 

32

 

 

-

 

 

32

  Mexico

 

651

 

 

725

 

 

(74)

 

 

131

 

 

(205)

 

 

-

 

 

(205)

Total Latin America

 

1,718

 

 

1,591

 

 

127

 

 

300

 

 

(173)

 

 

-

 

 

(173)

Xandr

 

426

 

 

160

 

 

266

 

 

13

 

 

253

 

 

-

 

 

253

Segment Total

 

45,692

 

 

30,344

 

 

15,348

 

 

5,014

 

 

10,334

 

$

67

 

$

10,401

Corporate and Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Corporate

 

433

 

 

661

 

 

(228)

 

 

204

 

 

(432)

 

 

 

 

 

 

  Acquisition-related items

 

(42)

 

 

73

 

 

(115)

 

 

1,988

 

 

(2,103)

 

 

 

 

 

 

  Certain significant items

 

-

 

 

248

 

 

(248)

 

 

-

 

 

(248)

 

 

 

 

 

 

  Eliminations and consolidations

 

(1,256)

 

 

(938)

 

 

(318)

 

 

-

 

 

(318)

 

 

 

 

 

 

AT&T Inc.

$

44,827

 

$

30,388

 

$

14,439

 

$

7,206

 

$

7,233

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14