{ "cells": [ { "cell_type": "markdown", "metadata": {}, "source": [ "Let's test our chunking, embedding and vectorization here" ] }, { "cell_type": "code", "execution_count": 13, "metadata": {}, "outputs": [], "source": [ "\n", "# import polars as pl\n", "import pandas as pd\n", "import pickle\n", "from rich.pretty import pprint\n", "import tiktoken # tokenizer library for use with OpenAI LLMs \n", "import os, sys\n", "from torch import set_num_threads\n", "import torch\n", "from tqdm import tqdm\n", "# from preprocessing import FileIO" ] }, { "cell_type": "code", "execution_count": 14, "metadata": {}, "outputs": [], "source": [ "set_num_threads(5)\n", "# it must be called before any model loading or inference operations begin or parallelism will be refused later" ] }, { "cell_type": "code", "execution_count": 15, "metadata": {}, "outputs": [], "source": [ "device = torch.device(\"cuda\" if torch.cuda.is_available() else \"cpu\")\n", "\n", "# create tensors on GPU if available\n", "if torch.cuda.is_available():\n", " torch.set_default_tensor_type('torch.cuda.FloatTensor')" ] }, { "cell_type": "code", "execution_count": 16, "metadata": {}, "outputs": [], "source": [ "datadir = \"../../data\"" ] }, { "cell_type": "code", "execution_count": 17, "metadata": {}, "outputs": [], "source": [ "# from llama_index.text_splitter import SentenceSplitter doesn't work anymore\n", "from llama_index.legacy.text_splitter import SentenceSplitter" ] }, { "cell_type": "code", "execution_count": 8, "metadata": {}, "outputs": [], "source": [ "from llama_index.core.node_parser import SentenceSplitter" ] }, { "cell_type": "code", "execution_count": 1, "metadata": {}, "outputs": [ { "data": { "text/html": [ "\n", " \n", " " ], "text/plain": [ "" ] }, "execution_count": 1, "metadata": {}, "output_type": "execute_result" } ], "source": [ "from IPython.display import IFrame\n", "IFrame(src=\"https://www.sbert.net/_static/html/models_en_sentence_embeddings.html\", width='100%', height=600)" ] }, { "cell_type": "code", "execution_count": 18, "metadata": {}, "outputs": [ { "data": { "text/html": [ "
SentenceSplitter(\n",
       "│   include_metadata=True,\n",
       "│   include_prev_next_rel=True,\n",
       "│   callback_manager=<llama_index.legacy.callbacks.base.CallbackManager object at 0x1cfb5a440>,\n",
       "│   id_func=<function default_id_func at 0x1cd5e1510>,\n",
       "│   chunk_size=256,\n",
       "│   chunk_overlap=20,\n",
       "│   separator=' ',\n",
       "│   paragraph_separator='\\n\\n\\n',\n",
       "│   secondary_chunking_regex='[^,.;。？！]+[,.;。？！]?'\n",
       ")\n",
       "
\n" ], "text/plain": [ "\u001b[1;35mSentenceSplitter\u001b[0m\u001b[1m(\u001b[0m\n", "\u001b[2;32m│ \u001b[0m\u001b[33minclude_metadata\u001b[0m=\u001b[3;92mTrue\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[33minclude_prev_next_rel\u001b[0m=\u001b[3;92mTrue\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[33mcallback_manager\u001b[0m=\u001b[1m<\u001b[0m\u001b[1;95mllama_index.legacy.callbacks.base.CallbackManager\u001b[0m\u001b[39m object at \u001b[0m\u001b[1;36m0x1cfb5a440\u001b[0m\u001b[39m>,\u001b[0m\n", "\u001b[2;32m│ \u001b[0m\u001b[33mid_func\u001b[0m\u001b[39m=\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[33mchunk_size\u001b[0m=\u001b[1;36m256\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[33mchunk_overlap\u001b[0m=\u001b[1;36m20\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[33mseparator\u001b[0m=\u001b[32m' '\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[33mparagraph_separator\u001b[0m=\u001b[32m'\\n\\n\\n'\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[33msecondary_chunking_regex\u001b[0m=\u001b[32m'\u001b[0m\u001b[32m[\u001b[0m\u001b[32m^,.;。？！\u001b[0m\u001b[32m]\u001b[0m\u001b[32m+\u001b[0m\u001b[32m[\u001b[0m\u001b[32m,.;。？！\u001b[0m\u001b[32m]\u001b[0m\u001b[32m?'\u001b[0m\n", "\u001b[1m)\u001b[0m\n" ] }, "metadata": {}, "output_type": "display_data" } ], "source": [ "chunk_overlap = 20\n", "\n", "#instantiate tokenizer for use with ChatGPT-3.5-Turbo\n", "encoding = tiktoken.encoding_for_model('gpt-3.5-turbo-0613')\n", "# tokens = encoding.encode_batch(contents)\n", "splitter = SentenceSplitter(chunk_size=256, # limit for 'all-mpnet-base-v2'\n", " tokenizer=encoding.encode, \n", " chunk_overlap=chunk_overlap)\n", "pprint(splitter)" ] }, { "cell_type": "code", "execution_count": null, "metadata": {}, "outputs": [ { "data": { "text/plain": [ "{'AMZN_Moodys_CreditRating_2023.pdf': [\"CORPORATES\\nCREDIT OPINION\\n23 May 2023\\nUpdate\\nRATINGS\\nAmazon.com, Inc.\\nDomicile Seattle, Washington,\\nUnited States\\nLong Term Rating A1\\nType Senior Unsecured -\\nDom Curr\\nOutlook Stable\\nPlease see the ratings section at the end of this report\\nfor more information. The ratings and outlook shown\\nreflect information as of the publication date.\\nContacts\\nChristina Boni +1.212.553.0514\\nSenior Vice President\\nchristina.boni@moodys.com\\nJack Myers +1.212.553.5116\\nAssociate Analyst\\njack.myers@moodys.com\\nMargaret Taylor +1.212.553.0424\\nAssociate Managing Director\\nmargaret.taylor@moodys.comAmazon.com, Inc.\\nUpdate to credit analysis\\nSummary\\nAmazon.com, Inc. 's (A1/Prime-1 stable) credit profile reflects its powerful global brand, which\\nis synonymous with online retail, as well as the strength and profitability of Amazon Web\\nServices (“AWS”), the market leader in the cloud computing market. The company is reliant\\non the operating income derived from AWS, as its non-AWS profitability has remained weak\\nsince the end of 2021. Although the company is making progress with improving productivity\\nand reducing costs, online operating margins remain well below historical levels. Amazon has\\ntaken actions to make its fulfillment operations more efficient as its business grows into its\\ncapacity, which doubled during the pandemic. Amazon has also built a solid ecosystem of\\nentertainment content that enhances its offering, operates a formidable third-party seller\\nbusiness and generates a solid and growing revenue stream from advertising. Nonetheless,\\nits credit metrics are currently weak for the A1 rating with RCF/Debt below 50%, as lower\\nprofitability, coupled with increased levels of investment have led to higher debt levels\\nand lower cash balances. Capital allocation will be critical to improving its credit profile as\\nAmazon navigates a weaker economic backdrop that could dampen demand for its products\\nand services as it pursues cost reductions and efficiencies to restore profitability at online\\nretail. The growing online presence of brick-and-mortar retailers, as well as the increasing\\ncompetition from larger, well capitalized companies in AWS' universe also presents future\\nchallenges.\\nExhibit 1\\nAmazon's debt has continued to rise as operating income remains below 2019\\n$0$20,000$40,000$60,000$80,000$100,000$120,000$140,000$160,000$180,000\\n$0$5,000$10,000$15,000$20,000$25,000$30,000\\n2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1 -23 LTM\\nMoody's Adjusted Debt (USD Millions)Moody's Adj. Operating Income (USD Millions)Moody's adjusted operating income Moody's adjusted debt\\nDebt includes lease\\nSource: Moody’s Financial Metrics™\\n\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nCredit strengths\\n»Leading online retailer and cloud provider\\n»AWS provides an increasing income stream provides solid positioning in AI\\n»Prime membership base supports customer loyalty\\n»Advertising revenue remains a significant area of growth\\nCredit challenges\\n»Brick-and-mortar retailers continue to increase online retail presence\\n»Heightened cloud competition from larger, well capitalized tech companies\\n»Inefficiencies in its retail fulfillment operations weigh on profitability\\n»Reduced cash balance lowers cushion for volatile or heavy investment periods\\nRating outlook\\nThe stable outlook reflects our view that Amazon will quickly restore its credit metrics to levels reflective of its A1 rating. The outlook\\nalso assumes that Amazon will maintain excellent liquidity and consistent financial strategies.\\nFactors that could lead to an upgrade\\n»Ratings could be upgraded if Amazon's numerous investments generate commensurate levels of profitability such that RCF/debt is\\nmaintained around 65%.\\n»Additional factors that would be critical for an upgrade are the continued maintenance of very strong liquidity, a robust cash and\\ninvestments to debt position and maintenance of conservative financial strategies.\\nFactors that could lead to a downgrade\\nRatings could be downgraded if:\\n»Operating performance continues to weaken, or\\n»It becomes clear that investments are not paying off, or\\n»Financial strategy is becoming significantly more aggressive with regard to cash returned to shareholders or acquisitions\\n»If for any of the above, RCF/debt falls below 50% for an extended period\\nThis publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the issuer/deal page on https://ratings.moodys.com for the\\nmost updated credit rating action information and rating history.\\n2 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nKey indicators\\nExhibit 2\\nAmazon.com, Inc.\\nUS Billions Dec-18 Dec-19 Dec-20 Dec-21 Dec-22LTM \\n(Mar-23)12-18 Month \\nForward View\\nRevenue 233 281 386 470 514 525 589\\nEBIT / Interest Expense 5.9x 6.8x 10.2x 9.6x 2.8x 2.9x 5.9x\\nRCF / Net Debt 87.7% 90.9% 81.4% 62.8% 53.9% 50.7% 90.2%\\nDebt / EBITDA 2.3x 2.2x 2.1x 2.3x 3.6x 3.6x 2.4x\\nAll figures and ratios are calculated using Moody’s estimates and standard adjustments. Moody's Forecasts (f) or Projections (proj.) are Moody's opinion and do not represent the views of\\nthe issuer. Periods are Financial Year-End unless indicated. LTM = Last Twelve Months.\\nSource: Moody’s Financial Metrics™\\nProfile\\nHeadquartered in Seattle, Washington, Amazon.com, Inc. is the world’s largest online retailer, and also a leading web services provider\\nvia AWS. Revenue was approximately $525 billion for the twelve months ended March 31, 2023.\\nExhibit 3\\nAmazon's Revenue by SegmentExhibit 4\\nAmazon's Operating Profit by Segment\\n$107,006 $135,987 $177,866 $232,887 $280,522 $386,064 $469,822 $513,983 $524,897 \\n $(50,000) $50,000 $150,000 $250,000 $350,000 $450,000 $550,000\\n2015 2016 2017 2018 2019 2020 2021 2022 Q1-23\\nLTMRevenue (USD Millions)North America International AWS\\nSource: Company SEC Filings$2,233 $4,186 $4,106 $12,420 $14,541 $22,899 $24,879 \\n$12,248 \\n$13,353 \\n $(10,000) $(7,500) $(5,000) $(2,500) $- $2,500 $5,000 $7,500 $10,000 $12,500 $15,000 $17,500 $20,000 $22,500 $25,000 $27,500 $30,000\\n2015 2016 2017 2018 2019 2020 2021 2022 Q1-23\\nLTMOperating Income (USD Millions)North America International AWS\\nSource: Company SEC Filings\\nDetailed credit considerations\\nAWS has leading market share, high profitability and solid long term prospects\\nAWS continues to generate most of Amazon's operating profit, making it possible for investment programs (delivery, content and\\ninternational) to continue. Despite still being relatively early in the conversion of companies transitioning to the cloud, revenue\\ngrowth and profitability of AWS continues to experience a slowing of growth in Q1 2023 as companies try to find more effective\\ncost solutions. Revenue growth in Q1 2023 has decelerated to 15.8% from 20.2% in Q4 2022 and 27.5% in Q3 2022, as operating\\nmargins decline sequentially and from last year. These trends have continued into Q2 2023 with April revenue growth rates lower than\\nQ1 2023. We expect revenue growth to improve toward the end of 2023 as optimization efforts of customers are exhausted. AWS’\\ncustomers continue to increase commitments for future capacity usage and we expect strong long-term growth for AWS benefiting\\nfrom migration of IT infrastructure investments from on-premise to the cloud. AWS is also well-positioned to capitalize on the rapidly\\ngrowing AI opportunity in the cloud with its scalable infrastructure, tools for developers to build and deploy models and services that\\ncustomers can use to leverage proprietary large language models. At the same time, AWS faces strong competitors with financial\\nresources such as Microsoft Corporation (Aaa Stable), Oracle Corporation (Baa2 Stable), Alphabet Inc. (Aa2 Stable), and IBM (A3\\nStable) that all aim to grow market share. Operating margin expansion for AWS could be challenged by increasing competition and\\nelevated investments.\\n3 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nOnline retail presence still dominates as digital efforts of brick and mortar accelerate\\nAmazon's online retail is the clear leader relative its US competitors. Nonetheless, competition has accelerated from larger players such\\nas Walmart Inc. (Aa2 stable), Target Corporation (A2 stable) and Best Buy Co., Inc. (A3 stable), all of which have continued to enhance\\ntheir online capabilities. These larger brick-and-mortar retailers can also leverage their store networks and proprietary distribution\\ncapability to offer the consumer options for obtaining their purchases. In store pickup provides a competitive offering (within hours\\nin most cases) and a more cost effective alternative to the seller. In addition, some brick-and-mortar retailers already have vehicle\\nnetworks that are used to stock its stores which could be used for some same day delivery capability. An example is the auto parts\\nretailers, which measure delivery times in hours, not days.\\nAmazon faces an increasingly competitive environment as the pandemic accelerated investment in areas such as curbside pickup,\\ninventory visibility and better usage of stores to fulfill orders. To combat these growing competitive threats, Amazon continues to\\nsupport its Prime Free One-Day Delivery initiative, which is an effort to counter buy-online/pick-up in store. The company is also\\nmoving its fulfillment network to a regionalized model which is expected to improve delivery speed and cost. To offset rising costs, the\\ncompany increased pricing on its prime membership in the U.S. in 2022 from $119 to $139 annually. The move, which is the first price\\nincrease since 2018 and will provide to offset to these continued investments.\\nThird-party sales remains an important part of the business with growth continuing to outpace first-party. Third party comprises\\n59% of paid units relative to 55% for the same period last year. The company has implemented a fuel and inflation as well as a peak\\nfulfillment surcharge on fulfillment fee per unit rates for Fulfilled by Amazon sellers in the face of rising inflation and energy costs. We\\nnote that Walmart has increased its third party efforts with its Advance Auto Parts and Shopify relationships. In the Advance example,\\nWalmart is providing space in its stores, as well as the use of its distribution network and placement on the website.\\nPhysical store sales remain primarily from Whole Foods. The 2017 acquisition of Whole Foods consisting now of over 500 locations\\nprovides Amazon with a “scalable” food business, as well as pickup points for online orders across categories. The company has closed\\nsome non-core concepts including its physical bookstores, and 4-star stores.\\nAdvertising revenue continues to grow rapidly in programmatic advertising and, in our opinion, has an advantage in this area given\\nits significant e-commerce presence and data gatheri ng. Growth in advertising revenue remains robust at over 23% in Q1 2023.\\nAdvertising for LTM March 2023 was roughly $39.4 billion, and we note advertising operating margins are generally healthy and\\ntypically run in the midteens. Along with AWS, the profitability of this category provides “buffer” to support its retail operations\\nperforming well below historical operating margins.\\nCost pressures are being addressed as investment is targeted at or below 2022 levels\\nAmazon's retail operations is contending with the inefficiency posed by the more than doubling of its capacity during the pandemic,\\nAmazon continues to work to move its cost structure closer to pre-pandemic levels and has made significant head count reduction\\nwith 27,000 roles eliminated including areas such as AWS as well as Twitch, devices, advertising and human resources.\\nAmazon remains committed to providing value to customers, despite inflation while slowing remaining elevated. The company is\\nbenefiting from continued improvement in shipping speeds and in-stock rates have recovered. Amazon has been contending with\\nhigher costs related to system productivity and inflation since the second half of 2021.\\nDuring first quarter 2023, Amazon continued to take cost cutting measures to improve margins and make progress on reducing its\\ncash usage. These efforts include shutting down businesses such as Amazon Fabric and Amazon Care as well as closing eight Amazon\\nGo locations. The company has also increased its minimum grocery purchases from $35 to $150 for free shipping and reduced\\ncorporate head count. Nonetheless, cost structure improvements have been partially offset by increased spend in advertising and other\\ninvestments such as video content and marketing costs.\\nAmazon expects investment in 2023 to be at or below 2022 levels at it reduces its spending on fulfillment and transportation given\\nits significant increase in capacity in recent years and shifts spending to technology and related infrastructure including large language\\nmodels and generative AI. In 2022, the company spent approximately $59 billion in capital investments.\\nAmazon has continued to pursue acquisitions it has exited businesses that are not reaching long term return goals. The company\\nacquired MGM Holdings Inc. (“MGM”) for approximately $8.5 billion, including MGM’s debt, in Q1 2022 which increased its video\\n4 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\ncontent which is a key component to its Prime's value proposition and differentiates its offering beyond shipping. MGM's revenue of\\nabout $1.5 billion represents less than 1% of Amazon's revenue. The company also closed in Q1 2023 on its $4 billion purchase of\\n1Life Healthcare Inc. “One Medical,” a national primary care provider with approximately $1 billion of LTM revenue as of December\\n2022. One Medical operates a chain of primary healthcare clinics. The business is based on a membership model where the company\\ncharges a fixed monthly subscription fee and in exchange provides regular primary care services. The company focuses on both physical\\nappointments and digital offerings. The company also has announced its intention to acquire iRobot for approximately $1.9 billion. The\\npurchase is currently still being reviewed by the FTC.\\nWe estimate that Amazon's RCF/debt can return to near our target of 50% RCF/debt at the end of 2023 to the extent that Amazon\\nprioritizes aligning free cash flow generation with its investments. Our estimates assumes that free cash flow is positive and utilized to\\nreduce funded debt. Nonetheless, the economic back drop remains weak which poses a need for continued capital allocation discipline\\nto achieve this goal. We also recognize that cash+short term investments as a percentage of debt remains below historical levels.\\nExhibit 5\\nRetained cash flow to debt expected to recover in the next 12-18 months\\n20%25%30%35%40%45%50%55%60%65%70%\\n2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1-23 LTM 12-18 Months\\nForward ViewUp Trigger Down Trigger RCF/Debt\\nCredit metrics reflect Moody's standard adjustments\\nSource: Moody’s Financial Metrics™, Moody's estimates\\nESG considerations\\nAmazon.com, Inc.'s ESG Credit Impact Score is Neutral-to-Low CIS-2\\nExhibit 6\\nESG Credit Impact Score\\nSource: Moody's Investors Service\\n(CIS-2 ) Amazon's ESG Credit Impact Score reflects our assessment that its governance practices which include maintaining high cash\\nbalances positions the company to meet its moderate exposure to environmental and social risks.\\n5 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nExhibit 7\\nESG Issuer Profile Scores\\nSource: Moody's Investors Service\\nEnvironmental\\n(E-3) Amazon's environmental risks reflect exposure to carbon transition risk as product transport, which currently relies primarily on\\ncombustion engine vehicles, remains integral to its operations. The company continues to invest in EV and is committed to growing\\nits EV fleet. Its physical climate risk is low as its operations are well diversified within the US and internationally. Natural capital risk is\\nviewed as low given its business diversification through AWS despite its sales of food and apparel.\\nSocial\\n(S-3) Amazon's social risk reflects its exposure to human capital, customer relations and responsible production. Human capital risk\\nhigher than most retailers, as AWS requires a more highly skilled workforce. The company’s exposure to risk related to demographic\\nand societal trends is lower than the that of the overall retail and apparel industry. Amazon remains poised to benefit from the\\ncontinued shift of consumers transacting online and the robust demand for IT infrastructure and the continued adoption of cloud\\nservices. Its business diversification with AWS and its significant volume with third party sellers lowers its responsible production risk.\\nData privacy issues surrounding both its online and web services segments increases customer relations risk.\\nGovernance\\n(G-2) Amazon's governance risk reflects its overall conservative financial policies, including the maintenance of high cash balances and\\nlimited shareholder distributions to date and its moderate leverage. The company has separate chairperson and CEO roles with Jeff\\nBezos as Chairman.\\nESG Issuer Profile Scores and Credit Impact Scores for the rated entity/transaction are available on Moodys.com. To view the latest\\nscores, please click here to go to the landing page for the entity/transaction on MDC and view the ESG Scores section.\\nLiquidity analysis\\nAmazon maintains strong liquidity from its significant cash balances, which provides the company with increased flexibility and this\\nremains a critical credit consideration. In January 2023, Amazon issued an $8 billion 364-day term loan to partially fund the One\\nMedical acquisition which closed February 2023. The company issued $12.75 billion of debt securities in April 2022 and $8.25 billion\\nin December 2022 ranging in maturity from 2024 to 2062. The use of proceeds were for general corporate purposes. We expect\\npositive free cash flow to be applied to debt reduction supported by improved working capital and better profitability at its non-AWS\\noperations.\\nIn March 2022, the company expanded its US commercial paper program to $20 billion. The commercial paper program includes the\\noption to issue €3 billion and is backed by a $10 billion revolving credit facility expiring March 29, 2025 as well as a $10 billion 364-day\\ncredit facility which was put in place on November 18, 2022 and may be extended once. As of March 31, 2023 the company had $7.8\\nbillion of commercial paper outstanding under its programs. A significant credit consideration to its short term and long term ratings\\nis Amazon's commitment to fully cover all commercial paper balances with the availability under its committed revolvers and excess\\nsame-day available cash balances. The commercial paper program is likely to be used to bridge working capital swings and adds to its\\nformidable liquidity profile. The revolving credit facility has same day availability, no ongoing MAC clause and no financial covenants.\\n6 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nRating methodology and scorecard factor\\n \\nThe following table shows Amazon.com, Inc.'s scorecard-indicated outcome using Retail Industry, with data as of March 31, 2023 and\\non a forward-looking basis. Applying Moody's 12-18 month forward view, the scorecard indicated outcome is A1, the same level as its\\nsenior unsecured rating.\\nExhibit 8\\nRetail Industry Scorecard [1][2] \\nFactor 1 : Scale (10%) Measure Score Measure Score\\na) Revenue (USD Billion) $524.9 Aaa $588.6 Aaa\\nFactor 2 : Business Profile (30%)\\na) Stability of Product Aa Aa Aa Aa\\nb) Execution and Competitive Position Aa Aa Aa Aa\\nFactor 3 : Leverage and Coverage (45%)\\na) EBIT / Interest Expense 2.9x Ba 5.9x Baa\\nb) RCF / Net Debt 50.7% Aa 90.2% Aa\\nc) Debt / EBITDA 3.6x Ba 2.4x A\\nFactor 4 : Financial Policy (15%)\\na) Financial Policy A A A A\\nRating: \\na) Scorecard-Indicated Outcome A2 A1\\nb) Actual Rating Assigned A1Current \\nLTM 3/31/2023Moody's 12-18 Month Forward View\\nAs of 5/16/2023 [3]\\n[1] All ratios are based on 'Adjusted' financial data and incorporate Moody's Global Standard Adjustments for Non-Financial Corporations.\\n[2] As of 3/31/2023 (L).\\n[3] This represents Moody's forward view; not the view of the issuer; and unless noted in the text, does not incorporate significant acquisitions and divestitures.\\nSource: Moody's Financial Metrics™, Moody's estimates\\n7 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\n \\nRatings\\nExhibit 9\\nCategory Moody's Rating\\nAMAZON.COM, INC.\\nOutlook Stable\\nSenior Unsecured A1\\nCommercial Paper P-1\\nWHOLE FOODS MARKET, INC.\\nOutlook Stable\\nSenior Unsecured A1\\nSource: Moody's Investors Service\\n8 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nAppendix\\nExhibit 10\\n(in US Millions)FYE\\nDec-18FYE\\nDec-19FYE\\nDec-20FYE\\nDec-21FYE\\nDec-22LTM Ending\\nMar-23\\nAs Reported Debt49,289 24,719 32,971 50,235 70,149 69,084\\nOperating Leases 21,442 52,814 67,533 82,083 84,823 85,695\\nNon-Standard Adjustments 101 101 725 725 6,800 15,800\\nMoody's-Adjusted Debt 70,832 77,634 101,229 133,043 161,772 170,579Moody's-Adjusted Debt Breakdown\\nAmazon.com, Inc.\\nAll figures are calculated using Moody’s estimates and standard adjustments.\\nSource: Moody’s Financial Metrics™\\nExhibit 11\\n(in US Millions)FYE\\nDec-18FYE\\nDec-19FYE\\nDec-20FYE\\nDec-21FYE\\nDec-22LTM Ending\\nMar-23\\nAs Reported EBITDA 28,028 31,277 42,589 63,385 21,956 32,278\\nOperating Leases 3,400 3,669 5,019 7,199 8,847 9,256\\nUnusual 0 0 0 -11,526 13,870 5,625\\nMoody's-Adjusted EBITDA 31,428 34,946 47,608 59,058 44,673 47,159Moody's-Adjusted EBITDA Breakdown\\nAmazon.com, Inc.\\nAll figures are calculated using Moody’s estimates and standard adjustments.\\nSource: Moody’s Financial Metrics™\\nExhibit 12\\nPeer snapshot\\n(in US millions)FYE\\nDec-21FYE\\nDec-22LTM\\nMar-23FYE\\nJan-21FYE\\nJan-22FYE\\nJan-23FYE\\nDec-21FYE\\nDec-22LTM\\nMar-23FYE\\nAug-21FYE\\nAug-22LTM\\nFeb-23FYE\\nMay-21FYE\\nMay-22LTM\\nFeb-23\\nRevenue $469,822 $513,983 $524,897 $559,151 $572,754 $611,289 $257,637 $282,836 $284,612 $195,929 $226,954 $234,390 $40,479 $42,440 $47,957\\nEBITDA $59,058 $44,673 $47,159 $36,657 $39,032 $37,233 $91,935 $94,469 $93,141 $8,928 $10,195 $10,493 $19,363 $19,268 $19,314\\nTotal Debt $133,043 $161,772 $170,579 $71,299 $57,323 $60,496 $34,992 $35,777 $36,292 $11,407 $10,906 $10,931 $93,460 $85,145 $101,097\\nCash & Cash Equiv. $36,220 $53,888 $49,343 $17,741 $14,760 $8,625 $20,945 $21,879 $25,924 $11,258 $10,203 $12,970 $30,098 $21,383 $8,219\\nEBITDA Margin 12.6% 8.7% 9.0% 6.6% 6.8% 6.1% 35.7% 33.4% 32.7% 4.6% 4.5% 4.5% 47.8% 45.4% 40.3%\\nEBIT / Int. Exp. 9.6x 2.8x 2.9x 7.4x 9.5x 8.3x 93.9x 84.1x 82.4x 29.7x 36.7x 39.1x 6.1x 5.4x 3.9x\\nDebt / EBITDA 2.3x 3.6x 3.6x 1.9x 1.5x 1.6x 0.4x 0.4x 0.4x 1.3x 1.1x 1.0x 4.8x 4.4x 5.2x\\nRCF / Net Debt 62.8% 53.9% 50.7% 43.5% 60.2% 40.8% 679.1% 691.3% 906.6% 1446.4% 1011.0% -364.5% 21.4% 13.7% 14.5%\\nFCF / Debt -19.5% -15.4% -8.9% 26.2% 6.9% 8.0% 194.0% 167.7% 170.6% -3.9% 14.8% 32.4% 11.4% 1.8% 3.8%A1 Stable Aa2 Stable Aa2 Stable Aa3 Stable Baa2 StableAmazon.com, Inc. Walmart Inc. Alphabet Inc. Costco Wholesale Corporation Oracle Corporation\\nAll figures & ratios calculated using Moody’s estimates & standard adjustments. FYE = Financial Year-End. LTM = Last Twelve Months. RUR* = Ratings under Review, where UPG = for\\nupgrade and DNG = for downgrade.\\nSource: Moody’s Financial Metrics™\\n9 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\n© 2023 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.\\nCREDIT RATINGS ISSUED BY MOODY'S CREDIT RATINGS AFFILIATES ARE THEIR CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT\\nCOMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY MOODY’S (COLLECTIVELY,\\n“PUBLICATIONS”) MAY INCLUDE SUCH CURRENT OPINIONS. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL\\nFINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE APPLICABLE MOODY’S\\nRATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY’S\\nCREDIT RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE\\nVOLATILITY. CREDIT RATINGS, NON-CREDIT ASSESSMENTS (“ASSESSMENTS”), AND OTHER OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT\\nSTATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND\\nRELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. AND/OR ITS AFFILIATES. MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER\\nOPINIONS AND PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER\\nOPINIONS AND PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. MOODY’S CREDIT\\nRATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR.\\nMOODY’S ISSUES ITS CREDIT RATINGS, ASSESSMENTS AND OTHER OPINIONS AND PUBLISHES ITS PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING\\nTHAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE,\\nHOLDING, OR SALE.\\nMOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE\\nRECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING\\nAN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.\\nALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED\\nOR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE\\nFOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN\\nCONSENT.\\nMOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS\\nDEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.\\nAll information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well\\nas other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it\\nuses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However,\\nMOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the credit rating process or in preparing its Publications.\\nTo the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any\\nindirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any\\nsuch information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or\\ndamages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a\\nparticular credit rating assigned by MOODY’S.\\nTo the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory\\nlosses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the\\navoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents,\\nrepresentatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.\\nNO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT\\nRATING, ASSESSMENT, OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.\\nMoody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including\\ncorporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any credit rating,\\nagreed to pay to Moody’s Investors Service, Inc. for credit ratings opinions and services rendered by it fees ranging from $1,000 to approximately $5,000,000. MCO and Moody’s\\nInvestors Service also maintain policies and procedures to address the independence of Moody’s Investors Service credit ratings and credit rating processes. Information regarding\\ncertain affiliations that may exist between directors of MCO and rated entities, and between entities who hold credit ratings from Moody’s Investors Service, Inc. and have also\\npublicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance\\n— Charter Documents - Director and Shareholder Affiliation Policy.”\\nAdditional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors\\nService Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended\\nto be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you\\nrepresent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or\\nindirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to\\nthe creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.\\nAdditional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s\\nOverseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally\\nRecognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an\\nentity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered\\nwith the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.\\nMJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred\\nstock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any credit rating, agreed to pay to MJKK or MSFJ (as applicable) for credit ratings opinions and services\\nrendered by it fees ranging from JPY100,000 to approximately JPY550,000,000.\\nMJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.\\nREPORT NUMBER 1366931\\n10 23 May 2023 Amazon.com, Inc.: Update to credit analysis\"],\n", " 'ATT_SEC_AnnualReport_2022.pdf': ['AT&T Inc. 2022 Annual Report \\nConnecting changes everything\\nF1157donD1R1.indd 1-3 3/2/23 12:50 PM',\n", " 'Our purpose \\nConnecting people \\nto greater possibility — with expertise, simplicity and inspiration.\\nF1157donD1R1.indd 4-6 3/7/23 5:15 PM',\n", " '11\\nTo our shareholders\\n2022 was a year of major change for AT&T, and we are proud to have ended \\nthe year in a stronger position. The realities of our industry, changing consumer expectations and an evolving macroeconomic environment dictated our need ¹ÂÅ\\x03´\\x03ƼÀÿ¼è¸·\\x03ÂøŴǼÁº\\x03À·¸¿\\x03´Á·\\x03Æ»´ÅÃ\\x03¸Ë¸¶ÈǼÂÁ\\x04\\x03\\nThat’s why we made the structural moves we did to reposition our company, \\nincluding successfully completing the separation of WarnerMedia. We have ¶ÂÁè·¸Á¶¸\\x03Ç»¸Å¸\\x03¼Æ\\x03´\\x03µÅ¼º»Ç\\x03¹ÈÇÈŸ\\x03¹ÂÅ\\x03´Á\\x03\\x9a\\xad\\x86\\xad\\x03Ç»´Ç\\x03·¸¿¼É¸ÅÆ\\x03Ç»¸\\x03µ¸ÆÇ\\x03 ¼Á\\x03¶ÂÁÁ¸¶Ç¼É¼ÇÌ\\x04\\nConnectivity is ingrained in our legacy going back nearly 150 years. We have \\nthe assets, talent and experience to ¶ÂÁÁ¸¶Ç\\x03øÂÿ¸\\x03ÇÂ\\x03ºÅ¸´Ç¸Å\\x03ÃÂÆƼµ¼¿¼ÇÌ\\x03ʼǻ\\x03ƼÀÿ¼¶¼ÇÌ\\x06\\x03¸ËøÅǼƸ\\x03´Á·\\x03¼ÁÆüŴǼÂÁ \\x04\\x03¢Á\\x03\\x1e\\x1c\\x1e\\x1e\\x06\\x03ʸ\\x03Êž¸·\\x03ÇÂ\\x03¹È¿è¿¿\\x03Ç»¼Æ\\x03\\npurpose in 3 ways:\\n\\x1d\\x04 We ºÅ¸Ê\\x03¶ÈÆÇÂÀ¸Å\\x03Ÿ¿´Ç¼ÂÁÆ»¼ÃÆ at a near record-setting pace, taking full \\n advantage of all-time-high levels of demand for strong, reliable connectivity.\\x1e\\x04 We were ¸æ¸¶Ç¼É¸\\x03´Á·\\x03¸ï¶¼¸ÁÇ\\x03¼Á\\x03ÂÈÅ\\x03ÂøŴǼÂÁÆ, reaching more than \\n$5 billion of our 3-year, $6 billion-plus run-rate cost transformation target. \\n\\x1f\\x04 Our ·¸¿¼µ¸Å´Ç¸\\x03¶´Ã¼Ç´¿\\x03´¿¿Â¶´Ç¼ÂÁ\\x03ÆÇŴǸºÌ enabled us to invest in 5G and \\n\\x03 赸Å\\x03´Ç\\x03»¼ÆÇÂż¶\\x03¿¸É¸¿Æ\\x06\\x03Ÿ·È¶¸\\x03ÂÈÅ\\x03Á¸Ç\\x03·¸µÇ\\x03µÌ\\x03´µÂÈÇ\\x03]\\x1e \\x03µ¼¿¿¼ÂÁ\\x03´Á·\\x03ƸÇ\\x03ÈÃ\\x03\\x03\\na structure we believe will drive better returns for you, our shareholders.\\n1\\nThis includes continuing to provide an attractive dividend.\\n\\x9cÂÁƼÆǸÁ¶Ì\\x03¼Á\\x03ÂøŴǼÂÁ´¿\\x03¸Ë¶¸¿¿¸Á¶¸\\x03\\nDescribing our go-to-market strategy is as simple as the strategy itself. Be\\n¶ÂÁƼÆǸÁÇ\\x03ʼǻ\\x03ÂÈÅ\\x03Âæ¸ÅÆ\\x03ÇÂ\\x03ÂÈÅ\\x03¶ÈÆÇÂÀ¸ÅÆ\\x06\\x03´Á·\\x03À´¾¸\\x03¼Ç\\x03¸´ÆÌ\\x03¹ÂÅ\\x03Ç»¸À\\x03ÇÂ\\x03·Â\\x03business with us.\\nWireless\\n¢Á\\x03®\\x04¬\\x04\\x03ʼŸ¿¸ÆÆ, w\\n e attracted nearly \\x1e\\x04%\\x03À¼¿¿¼ÂÁ\\x03ÃÂÆÇô¼·\\x03ûÂÁ¸\\x03Á¸Ç\\x03´··¼Ç¼ÂÁÆ\\x03\\n¼Á\\x03\\x1e\\x1c\\x1e\\x1e, marking our second-best annual results in more than a decade, behind \\nonly 2021. We also ºÅ¸Ê\\x03ʼŸ¿¸ÆÆ\\x03ƸÅɼ¶¸\\x03ŸɸÁȸÆ\\x03µÌ\\x03ÀŸ\\x03Ç»´Á\\x03!Y year over year, representing a multi-year high. And we did this while continuing to ¶ÂÁ¶¸ÁÇŴǸ\\x03ÂÁ\\x03ÃÅÂèÇ´µ¼¿¼ÇÌ\\x06\\x03¼Á¶Å¸´Æ¼Áº\\x03ʼŸ¿¸ÆÆ\\x03\\x9e\\x9b¢\\xad\\x9d\\x9a\\x03µÌ\\x03Á¸´Å¿Ì\\x03 Y\\x03´Á·\\x03´¶»¼¸É¼Áº\\x03ÂÈÅ\\x03ÀÂÆÇ\\x03ÃÅÂèÇ´µ¿¸\\x03̸´Å\\x03ÂÁ\\x03Ÿ¶ÂÅ· .\\n2 We are also a ¿¸´·¸Å\\x03¼Á\\x03Ç»¸\\x03\\n¢ÁǸÅÁ¸Ç\\x03¹\\x03\\xad»¼ÁºÆ\\x03\\x8b¢Â\\xad\\x8c. We added more than 12 million connected devices in \\x1e\\x1c\\x1e\\x1e\\x06\\x03µ¸¶ÂÀ¼Áº\\x03Ç»¸\\x03èÅÆÇ\\x03®\\x04¬\\x04\\x03¶´Åż¸Å\\x03ÇÂ\\x03¸Ë¶¸¸·\\x03\\x1d\\x1c\\x1c\\x03À¼¿¿¼ÂÁ\\x03¶ÂÁÁ¸¶Ç¸·\\x03·¸É¼¶¸Æ\\x04\\x03\\x03\\x03\\x03\\x03£Â»Á\\x03¬Ç´Á¾¸Ì \\n\\x9c»¼¸¹\\x03\\x9e˸¶ÈǼɸ\\x03¨ï¶¸Å\\nF1157donD2R1.indd 1F1157donD2R1.indd 1 3/1/23 7:14 PM3/1/23 7:14 PM',\n", " 'AT&T Inc. 2022 Annual Report 2\\n¨ÈÅ\\x03ʼŸ¿¸ÆÆ\\x03ÀÂÀ¸ÁÇÈÀ\\x03Ê´Æ\\x03´\\x03·¼Å¸¶Ç\\x03ŸÆÈ¿Ç\\x03¹\\x03ÂÈÅ\\x03ƼÀÿ¼è¸·\\x03É´¿È ¸\\x03ÃÅÂÃÂƼǼÂÁ\\x06\\x03\\n¿ÂʸÅ\\x03´¶ÄȼƼǼÂÁ\\x03¶ÂÆÇÆ\\x06\\x03·¼ÆÇżµÈǼÂÁ\\x03¸ï¶¼¸Á¶¼¸Æ\\x03´Á·\\x03ÂÈÅ\\x03´µ¼¿¼Ç Ì\\x03ÇÂ\\x03À¸¸Ç\\x03\\ncustomers on their terms.\\nThe strength of our wireless network \\x03ÿ´Ì¸·\\x03´\\x03¿´Åº¸\\x03Å¿¸\\x03¼Á\\x03ÂÈÅ\\x03Æȶ¶¸ÆÆ\\x06\\x03ʼǻ \\nÂÈÅ\\x03Ÿ¶¸ÁÇ\\x03Æø¶ÇÅÈÀ\\x03¼ÁɸÆÇÀ¸ÁÇÆ\\x03øŹÂÅÀ¼Áº\\x03¸É¸Á\\x03µ¸ÇǸÅ\\x03Ç»´Á\\x03¸Ëà ¸¶Ç¸·\\x04\\x03¢Á \\n¹´¶Ç\\x06\\x03ʸ\\x03ʸŸ\\x03¸ï¶¼¸ÁÇ\\x03¸ÁÂȺ»\\x03 ʼǻ\\x03ÂÈÅ\\x03·¸Ã¿ÂÌÀ¸ÁÇ\\x03¹\\x03À¼·\\x88µ´Á·\\x03!\\xa0 \\x03Æø¶ÇÅÈÀ \\nthat we reached more than 150 million people, more than double our \\noriginal year -end cover age target \\x04\\x03\\x9aÁ·\\x03ʸ\\x03¸Ëø¶Ç\\x03ÇÂ\\x03»¼Ç\\x03\\x1e\\x1c\\x1c\\x03À¼¿¿¼ÂÁ\\x03øÂÿ¸\\x03µÌ \\nÇ»¸\\x03¸Á·\\x03¹\\x03\\x1e\\x1c\\x1e\\x1f\\x04\\x03\\x9aÆ\\x03´\\x03ŸÆÈ¿Ç\\x06\\x03ÂÈÅ\\x03´¿Å¸´·Ì\\x03¶ÂÁƼÆǸÁÇ\\x03·ÂÊÁ¿Â´·\\x03Æ Ã¸¸·Æ\\x03¼Á¶Å¸´Æ¸· \\nÀ´Ç¸Å¼´¿¿Ì\\x06\\x03´Æ\\x03Ÿ¶¸ÁÇ¿Ì\\x03Ÿ¶ÂºÁ¼Í¸·\\x03¼Á\\x03Ç»¸\\x03«ÂÂÇ\\x03¦¸Çż¶Æ\\x03Ƹ¶ÂÁ·\\x88» ´¿¹\\x03\\x1e\\x1c\\x1e\\x1e\\x03ŸÆÈ¿ÇÆ\\x04 \\n\\xad»¼Æ\\x03¼Á¶Å¸´Æ¸·\\x03Æø¸·\\x03ÃÅÂɼ·¸·\\x03´ÁÂÇ»¸Å\\x03ƼºÁ¼è¶´ÁÇ\\x03µ¸Á¸èÇ\\x03ÇÂ\\x03ÂÈÅ\\x03 ¶ÈÆÇÂÀ¸ÅÆ\\x04\\n¨ÈÅ\\x03ʼŸ¿¸ÆÆ\\x03Á¸ÇÊž\\x03¼Æ\\x03´¿ÆÂ\\x03Ç»¸\\x03»¸´ÅÇ\\x03¹\\x03\\x9f¼ÅÆǧ¸ÇÒ\\x06\\x03Ãȵ¿¼¶\\x03Æ´¹ ¸ÇÌ\\x0cÆ\\x03·¸·¼¶´Ç¸·\\x06\\x03\\nnationwide communications platform. The AT&T and FirstNet networks ¶ÂɸÅ\\x03ÀŸ\\x03Ç»´Á\\x03%%Y\\x03¹\\x03Ç»¸\\x03ÃÂÃÈ¿´Ç¼ÂÁ\\x03Ç·´Ì\\x06\\n\\x1f\\x03´Á·\\x03\\x9f¼ÅÆǧ¸Ç\\x03¶ÂɸÅÆ\\x03ÀŸ\\x03\\nèÅÆÇ\\x03ŸÆÃÂÁ·¸ÅÆ\\x03Ç»´Á\\x03´ÁÌ\\x03ÂÇ»¸Å\\x03Á¸ÇÊž\\x03¼Á\\x03\\x9aÀ¸Å¼¶´\\x044\\x03¢ÇÔÆ\\x03´Á\\x03»ÂÁÂÅ\\x03ÇÂ\\x03ƸÅɸ\\x03\\n´Á·\\x03ÆÈÃÃÂÅÇ\\x03Ç»¸À\\x03ʼǻ\\x03ÃżÂżǼ͸·\\x03¶ÂÁÁ¸¶Ç¼É¼ÇÌ\\x03´Á·\\x03¶´Ã´¶¼ÇÌ\\x03Ã¿È Æ\\x03·¸·¼¶´Ç¸·\\x03\\nÆø¶ÇÅÈÀ\\x04\\x03°¸\\x03¸Á·¸·\\x03Ç»¸\\x03̸´Å\\x03ʼǻ\\x03 about 4.4 million FirstNet connections \\nacross more than 24,000 agencies . \\nFiber\\n°¸\\x03·¸¿¼É¸Å¸·\\x03ÆÇÅÂÁº\\x03¹È¿¿\\x88̸´Å\\x03ŸÆÈ¿ÇÆ\\x03¼Á\\x03 AT&T Fiber® \\x03´Æ\\x03ʸ¿¿\\x04\\x03\\x9f¼µ¸Å\\x03¼Æ\\x03´\\x03·ÈÅ´µ¿¸\\x06\\x03\\nÆÈÆÇ´¼Á´µ¿¸\\x03Ǹ¶»Á¿ºÌ\\x03Ç»´Ç\\x03¶ÂÁÁ¸¶ÇÆ\\x03øÂÿ¸\\x03´Á·\\x03µÈƼÁ¸ÆƸÆ\\x03ʼǻ \\x03¸´¶»\\x03ÂÇ»¸Å\\x03\\n´Á·\\x03ÇÂ\\x03Ç»¸\\x03ÊÂÅ¿·\\x04\\x03\\x9f¼µ¸Å\\x03¼ÁɸÆÇÀ¸ÁÇÆ\\x03»´É¸\\x03´\\x03ÀȿǼ\\x88·¸¶´·¸\\x03¿¼¹¸Æô Á\\x06\\x03´Á·\\x03ʸÔŸ\\x03\\n¼ÁɸÆǼÁº\\x03»¸´É¼¿Ì\\x03ÇÂ\\x03µÈ¼¿·\\x03ÂÈÇ\\x03ÂÈÅ\\x03Á¸ÇÊž\\x04\\x03°¸\\x03µ¸¿¼¸É¸\\x03Ç»´Ç\\x03\\x9a\\xad\\x86 \\xad\\x03Âæ¸ÅÆ\\x03Ç»¸\\x03\\nµ¸ÆÇ\\x03ʼŸ·\\x03¼ÁǸÅÁ¸Ç\\x03´É´¼¿´µ¿¸\\x04\\x03 ªÈ¼Ç¸\\x03ƼÀÿÌ\\x06\\x03Ê»¸Å¸\\x03ʸ\\x03µÈ¼¿·\\x03赸Å\\x06\\x03ʸ\\x03ʼÁ\\x04\\n\\x1e\\x1c\\x1e\\x1e\\x03À´Å¾¸·\\x03ÂÈÅ\\x03 èì»\\x03ÆÇÅ´¼º»Ç\\x03̸´Å\\x03ʼǻ\\x03\\x1d\\x03À¼¿¿¼ÂÁ\\x03ÂÅ\\x03ÀŸ\\x03Á¸Ç\\x03´··¼Ç¼ÂÁÆ \\x06\\x03\\nÅ´¼Æ¼Áº\\x03ÂÈÅ\\x03\\x9a\\xad\\x86\\xad\\x03\\x9f¼µ¸Å\\x03Æȵƶżµ¸Å\\x03µ´Æ¸\\x03ÇÂ\\x03ÀŸ\\x03Ç»´Á\\x03#\\x03À¼¿¿¼ÂÁ\\x04\\x03 We led the \\n¼Á·ÈÆÇÅÌ\\x03¼Á\\x03µÅ¼Áº¼Áº\\x03赸Å\\x03ÇÂ\\x03»ÂÀ¸Æ!\\x03´Á·\\x03¶¿ÂƸ·\\x03Ç»¸\\x03̸´Å\\x03ʼǻ\\x03Ç»¸\\x03´µ¼¿¼ÇÌ\\x03 \\nÇÂ\\x03ƸÅɸ\\x03 more than 19 million consumer locations \\x04\\x03°¸\\x03´¿ÆÂ\\x03»´É¸\\x03Ç»¸\\x03 \\n´µ¼¿¼ÇÌ\\x03ÇÂ\\x03ƸÅɸ\\x03 more than 3 million business locations . We are on track \\nÇÂ\\x03Ÿ´¶»\\x03ÂÈÅ\\x03ßɼÂÈÆ¿Ì\\x03´ÁÁÂÈÁ¶¸·\\x03ºÂ´¿\\x03¹\\x03 30 million-plus total locations \\x06\\x03\\n¼Á¶¿È·¼Áº\\x03¶ÂÁÆÈÀ¸Å\\x03´Á·\\x03µÈƼÁ¸ÆÆ\\x06\\x03µÌ\\x03Ç»¸\\x03¸Á·\\x03¹\\x03\\x1e\\x1c\\x1e!\\x04\\x03\\n¨ÈÅ\\x03Ÿ¶¸ÁÇ¿Ì\\x03´ÁÁÂÈÁ¶¸·\\x03´ºÅ¸¸À¸ÁÇ\\x03ÇÂ\\x03¹ÂÅÀ\\x03´\\x03 joint venture with BlackRock \\nAlternatives — Gigapower \\x03\\x8a\\x03¼Æ\\x03´Á\\x03¼ÁÁÂɴǼɸ\\x03Á¸Ê\\x03µÈƼÁ¸ÆÆ\\x03À·¸¿\\x03ʸ\\x03´Å¸\\x03\\nǸÆǼÁº\\x03ÇÂ\\x03·Å´À´Ç¼¶´¿¿Ì\\x03¼Á¶Å¸´Æ¸\\x03Ç»¸\\x03ô¶¸\\x03¹\\x03赸Å\\x03¼ÁÆÇ´¿¿´Ç¼ÂÁ\\x03 ÂÈÇƼ·¸\\x03¹\\x03ÂÈÅ\\x03\\nÇÅ´·¼Ç¼ÂÁ´¿\\x03ʼŸ¿¼Á¸\\x03À´Å¾¸ÇÆ\\x04\\x03°¸\\x03µ¸¿¼¸É¸\\x03´º¼¿¸\\x03ɸÁÇÈŸÆ\\x03¿¼¾¸\\x03Ç» ¼Æ\\x03ÂøÁ\\x03ÈÃ\\x03Á¸Ê\\x03\\nÃÂÆƼµ¼¿¼Ç¼¸Æ\\x03ÇÂ\\x03¶ÂÁÁ¸¶Ç\\x03ÈÁ·¸ÅƸÅÉ ¸·\\x03À´Å¾¸ÇÆ\\x03ʼǻ\\x03赸Å\\x03´Á·\\x03¶´Á\\x03 ¶ÂÀøǸ\\x03ÀŸ \\n¸æ¸¶Ç¼É¸¿Ì\\x03¹ÂÅ\\x03Ç»¸\\x03¶»´Á¶¸\\x03ÇÂ\\x03¶Â\\x88¼ÁɸÆÇ\\x03ʼǻ\\x03Ç»¸\\x03®\\x04¬\\x04\\x03ºÂɸÅÁÀ¸ÁÇ \\x03ÂÁ\\x03ÂÈÅ\\x03Æ»´Å¸·\\x03\\nµ½¸¶Ç¼É¸Æ\\x03¹\\x03´\\x03µ¸ÇǸÅ\\x06\\x03¶ÂÁÁ¸¶Ç¸·\\x03\\x9aÀ¸Å¼¶´\\x04\\x03\\x9a\\xad\\x86\\xad\\x03»´Æ\\x03Ç»¸\\x03´µ¼¿¼ÇÌ\\x03\\nÇÂ\\x03ƸÅɸ\\x03ÀŸ\\x03Ç»´Á\\x03\\n\\x1e\\x1e\\x03À¼¿¿¼ÂÁ\\x03¶ÂÁÆÈÀ¸Å\\x03\\n´Á·\\x03µÈƼÁ¸ÆÆ\\x03\\n¿Â¶´Ç¼ÂÁÆ\\x03ʼǻ\\x03赸Å\\x04\\nF1157donD2R1.indd 2 F1157donD2R1.indd 2 3/7/23 9:06 PM 3/7/23 9:06 PM',\n", " '33\\nThese results illustrate ÂÈÅ\\x03´ÃÃÅ´¶»\\x03»´Æ\\x03·¸¿¼É¸Å¸· , and while we’ll remain \\n´º¼¿¸\\x03´Æ\\x03Ç»¸\\x03¼Á·ÈÆÇÅÌ\\x03´Á·\\x03¸¶ÂÁÂÀÌ\\x03Æ»¼ì\\x06\\x03ʸÔŸ\\x03¶ÂÁè·¸ÁÇ\\x03¼Á\\x03ÂÈÅ\\x03´ µ¼¿¼ÇÌ\\x03ÇÂ\\x03\\ncontinue executing at a high level.\\n\\x9cÂÅÃÂŴǸ\\x03ŸÆÃÂÁƼµ¼¿¼ÇÌ\\nThis ·Å¼É¸\\x03ÇÂ\\x03¶ÂÁÁ¸¶Ç\\x03øÂÿ¸\\x03ÇÂ\\x03ºÅ¸´Ç¸Å\\x03ÃÂÆƼµ¼¿¼ÇÌ includes doing our part \\nto create a more connected society and provide underserved communities with the resources they need for education, employment, health care and economic opportunity. \\nDespite the growing availability of high-quality connectivity, \\x03ÂÁ¸\\x88èì»\\x03¹ \\nÇ»¸\\x03®\\x04¬\\x04\\x03ÃÂÃÈ¿´Ç¼ÂÁ\\x03¼Æ\\x03ÆǼ¿¿\\x03¼Àô¶Ç¸·\\x03µÌ\\x03Ç»¸\\x03·¼º¼Ç´¿\\x03·¼É¼·¸ .\\n6 We’re passionate \\nabout addressing this issue because our country has a once-in-a-generation opportunity to close the broadband gap. Achieving this will give more Americans better opportunities to further their education and access online training to develop workforce skills, all of which helps foster greater economic equity. That’s why we made a \\x1f\\x88̸´Å\\x06\\x03]\\x1e\\x03µ¼¿¿¼ÂÁ\\x03¶ÂÀÀ¼ÇÀ¸ÁÇ in 2021 to help \\nbridge the digital divide. With this commitment and AT&T’s technology ÿ´Ç¹ÂÅÀÆ\\x03¹ÂÅ\\x03!\\xa0\\x03´Á·\\x03赸Å\\x03·¸Ã¿ÂÌÀ¸ÁÇ\\x03Ç»´Ç\\x03´Å¸\\x03 ´æÂÅ·´µ¿¸\\x06\\x03ÆÈÆÇ´¼Á´µ¿¸\\x03´Á· \\n·ÈÅ´µ¿¸\\x06\\x03ʸ\\x03»´É¸\\x03Ç»¸\\x03¸ËøÅǼƸ\\x03´Á·\\x03ƶ´¿¸\\x03ÇÂ\\x03À´¾¸\\x03´\\x03¿ÂÁº\\x88ǸÅÀ\\x03·¼æ¸Å¸Á¶¸ \\x04\\x03°¸ÔŸ \\nworking to address 3 key components to the digital divide:\\n\\x1d\\x04\\x03 \\x9a¶¶¸ÆÆ\\x04 This primarily impacts areas of the country where deployment \\n\\x03 ¶´Á\\x03µ¸\\x03·¼ï¶È¿Ç\\x03ÂÅ\\x03Æ¿ÂÊ\\x06\\x03µÈÇ\\x03¼ÇÔÆ\\x03ÆÇ´ÅǼÁº\\x03ÇÂ\\x03ü¶¾\\x03ÈÃ\\x03Ç»´Á¾Æ\\x03Ç \\x03Ç»¸\\x03ÀŸ\\x03Ç»´Á\\x03 \\n\\x03 ] $\\x03µ¼¿¿¼ÂÁ\\x03´¿¿Â¶´Ç¸·\\x03µÌ\\x03\\x9cÂÁºÅ¸ÆÆ\\x03´Á·\\x03Ç»¸\\x03\\x9b¼·¸Á\\x03´·À¼Á¼ÆÇŴǼÂÁ \\x03ÇÂ\\x03¸ËôÁ·\\x03 \\n broadband infrastructure. Decisions on where to invest in that infrastructure \\n have largely been vested in states, tribal governments and municipalities, and ʸÔŸ\\x03Êž¼Áº\\x03·¼¿¼º¸ÁÇ¿Ì\\x03ÇÂ\\x03èÁ·\\x03Ç»¸\\x03żº»Ç\\x03ÂÃÃÂÅÇÈÁ¼Ç¼¸Æ\\x03¹ÂÅ\\x03Ãȵ ¿¼¶\\x88\\x03\\n\\x03 ÃżɴǸ\\x03ôÅÇÁ¸ÅÆ»¼ÃÆ\\x03Ç»´Ç\\x03¸Á´µ¿¸\\x03\\x9a\\xad\\x86\\xad\\x03ÇÂ\\x03»¸¿Ã\\x03¹ÈÁ·\\x06\\x03µÈ¼¿·\\x03´Á·\\x03 À´¼ÁÇ´¼Á\\x03 \\n\\x03 Ç»¸Æ¸\\x03Á¸ÇÊÂÅ¾Æ . \\n\\x1e\\x04\\x03 \\x9aæÂÅ·´µ¼¿¼ÇÌ\\x04 \\x03\\x9a\\xad\\x86\\xad\\x03¼Æ\\x03´\\x03É¿ÈÁÇ´ÅÌ\\x03ôÅǼ¶¼Ã´ÁÇ\\x03¼Á\\x03Ç»¸\\x03\\x9f\\x9c\\x9cÔÆ\\x03\\x9aæÂÅ·´µ¿¸\\x03\\x03\\n Connectivity Program that subsidizes the cost of wireless or internet service for eligible households. When paired with our low-cost Access from AT&T \\x03 Âæ¸Å¼Áº\\x06\\x03 ÄÈ´¿¼è¸·\\x03¶ÈÆÇÂÀ¸ÅÆ\\x03¶´Á\\x03Ÿ¶¸¼É¸\\x03¼ÁǸÅÁ¸Ç\\x03Æø¸·Æ\\x03ÈÃ\\x03ÇÂ\\x03\\x1d\\x1c\\x1c\\x03¦µÃÆ\\x03\\x03\\n\\x03 ¹ÂÅ\\x03¹Å¸¸ .\\n\\x1f\\x04\\x03 \\x9a·ÂÃǼÂÁ\\x04\\x03 We’re providing communities, students and parents with ¹Å¸¸\\x03 \\n\\x03 ·¼º¼Ç´¿\\x03¿¼Ç¸Å´¶Ì\\x06\\x03ÂÁ¿¼Á¸\\x03Æ´¹¸ÇÌ\\x03´Á·\\x03·¼º¼Ç´¿\\x03¿¸´ÅÁ¼Áº\\x03Ç¿Æ\\x03 so they understand \\n and feel comfortable with connectivity and can get the most out of their \\n internet connections. These include our Connected Learning Centers housed within local community organizations. The cent ers provide students and \\n families with computers, high-speed internet access and digital learning and literacy resources. We have 20 of these centers today and plan to reach \\n\\x03 !\\x1c\\x03ÇÂÇ´¿\\x03¿Â¶´Ç¼ÂÁÆ\\x03µÌ\\x03\\x1e\\x1c\\x1e \\x04\\x03We have a once- \\nin-a-generation \\nopportunity \\nto close the \\nbroadband gap.\\nF1157donD2R1.indd 3 F1157donD2R1.indd 3 3/1/23 7:14 PM 3/1/23 7:14 PM',\n", " 'AT&T Inc. 2022 Annual Report 4\\n¬¼Á¶¸Å¸¿Ì\\x06\\n£Â»Á\\x03¬Ç´Á¾¸Ì\\n\\x9c»¼¸¹\\x03\\x9e˸¶ÈǼɸ\\x03¨ï¶¸Å\\x06\\x03\\x9a\\xad\\x86\\xad\\x03¢Á¶\\x04February 13, 2023Finally, AT&T is taking action to address climate change in ways relevant to \\nour business and to prepare for its impacts on our operations, customers and communities. We’ve set meaningful goals for 2035, including to be carbon neutral across our global operations. We’ll also help our business customers save a gigaton of greenhouse gas emissions through AT&T connectivity solutions. We’re currently using cutting-edge climate projections to build a more climate resilient network, and we’re sharing the modeled data publicly to help communities better prepare for extreme weather events.\\n\\xad»´Á¾\\x03ÌÂÈ\\nAT&T’s resilience and strong performance are attributable to the perseverance of the people we have guiding and operating the business and serving our customers every day.\\n\\xadÂ\\x03ÂÈÅ\\x03¼ÁÆüŸ·\\x03¸ÀÿÂ̸¸Æ\\x05 Thank you for working tirelessly to keep our \\ncustomers connected, sometimes in the toughest conditions imaginable. Your deep expertise across the entire business serves and delights everyone from consumers to business customers to our government partners. Together, we’re creating a “big tent” that nurtures and respects a broad spectrum of beliefs, identities and cultures. The strength of our diversity, equity and inclusion practices also informs how we, as a company, approach the big social issues facing us today. We start with you in mind as we support public policies that foster growth in our business and help you, your families, neighbors and friends to achieve your greatest possibilities. \\n\\xadÂ\\x03ÂÈÅ\\x03¶ÈÆÇÂÀ¸ÅÆ\\x05 You’re the reason we’re here. We’re committed to \\ndelivering a more connected future — one full of possibility — that improves your lives for the better. Thank you for the trust you place in us. In return, we work tirelessly to serve you and give our best every day. \\n\\x9aÁ·\\x03ÇÂ\\x03ÂÈÅ\\x03Æ»´Å¸»Â¿·¸ÅÆ\\x05 \\x03\\xad»´Á¾\\x03ÌÂÈ\\x03¹ÂÅ\\x03ÌÂÈÅ\\x03¶ÂÁè·¸Á¶¸\\x03¼Á\\x03\\x9a\\xad\\x86\\xad\\x04\\x03°¸\\x03µ¸¿¼¸É¸\\x03\\nwe’ve made steady, consistent progress toward proving our strategy is the right one, and we’re committed to continuing our focus on improving our returns to you.By 2035, AT&T will be \\ncarbon neutral.\\nF1157donD2R1.indd 4 F1157donD2R1.indd 4 3/1/23 7:14 PM 3/1/23 7:14 PM',\n", " '5AT&T Inc. Financial Review 2022\\nManagement’s Discussion and Analysis\\nof Financial Condition and Results of Operations............................................................... 6\\nConsolidated Financial Statements........................................................................................... 34Notes to Consolidated Financial Statements........................................................................ 40Report of Management............................................................................................................. ....... 80\\nReport of Independent Registered Public Accounting Firm .......................................... 81References..................................................................................................................... ......................... 84\\nBoard of Directors ............................................................................................................... ............... 85\\nOfficers of AT&T Inc. ................................................................................................................. ......... 86',\n", " 'OVERVIEW\\nAT&T Inc. is referred to as “we,” “AT&T” or the “Company”\\nthroughout this document. AT&T products and servicesare provided or offered by subsidiaries and affiliates ofAT&T Inc. under the AT&T brand and not by AT&T Inc., andthe names of the particular subsidiaries and affiliatesproviding the services generally have been omitted. AT&Tis a holding company whose subsidiaries and affiliatesoperate worldwide in the telecommunications andtechnology industries. You should read this discussion inconjunction with the consolidated financial statementsand accompanying notes (Notes). Unless otherwise noted,this discussion refers only to our continuing operationsand does not include discussion of balances or activity ofWarnerMedia, Vrio, Xandr and Playdemic Ltd. (Playdemic),which are part of discontinued operations.\\nOur Management’s Discussion and Analysis of Financial\\nCondition and Results of Operations included in thisdocument generally discusses 2022 and 2021 items andyear-to-year comparisons between 2022 and 2021.Discussions of 2020 items and year-to-year comparisonsbetween 2021 and 2020 that are not included in thisdocument can be found in “Management’s Discussion andAnalysis of Financial Condition and Results of Operations”in Part II, Item 7 of our Annual Report on Form 10-K for thefiscal year ended December 31, 2021.\\nOn April 8, 2022, we closed our transaction to combine\\nsubstantially all of our WarnerMedia segment(WarnerMedia) with a subsidiary of Discovery, Inc(Discovery). Upon the separation and distribution ofWarnerMedia, the WarnerMedia business met the criteria\\nfor discontinued operations. For discontinued operations,we also evaluated transactions that were components ofAT&T’s single plan of a strategic shift, includingdispositions that did not individually meet the criteria dueto materiality, and have determined discontinuedoperations to be comprised of WarnerMedia, Vrio, Xandrand Playdemic. These businesses are reflected in theaccompanying financial statements as discontinuedoperations, including for periods prior to theconsummation of the WarnerMedia/Discoverytransaction .(See Notes 6 and 23)\\nOn July 31, 2021, we closed our transaction with TPG\\nCapital (TPG) to form a new company named DIRECTV\\nEntertainment Holdings, LLC (DIRECTV). With the close of\\nthe transaction, we separated our Video business,\\ncomprised of our U.S. video operations, and began\\naccounting for our investment in DIRECTV under the\\nequity method. (See Note 6)\\nWe have two reportable segments: Communications and\\nLatin America. Our segment results presented in Note 4and discussed below follow our internal managementreporting. Each segment’s percentage calculation of totalsegment operating revenue is derived from our segmentresults table in Note 4. Segment operating income isattributable to our Communications segment due tooperating losses in Latin America. Percentage increasesand decreases that are not considered meaningful aredenoted with a dash.\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nOperating Revenues\\nCommunications $ 117,067 $ 114,730 $ 109,965 2.0 % 4.3 %\\nLatin America 3,144 2,747 2,562 14.5 7.2\\nCorporate and Other:\\nCorporate 530 731 766 (27.5) (4.6)\\nVideo — 15,513 28,610 — (45.8)\\nHeld-for-sale and other reclassifications — 453 1,414 — (68.0)\\nEliminations and consolidation — (136) (267) — 49.1\\nAT&T Operating Revenues $ 120,741 $ 134,038 $ 143,050 (9.9)% (6.3)%\\nOperating Income\\nCommunications $ 29,107 $ 28,393 $ 29,062 2.5 % (2.3)%\\nLatin America (326) (510) (587) 36.1 13.1\\nSegment Operating Income 28,781 27,883 28,475 3.2 (2.1)\\nCorporate (2,570) (1,644) (1,398) (56.3) (17.6)\\nVideo — 2,491 2,174 — 14.6\\nHeld-for-sale and other reclassifications — 143 681 — (79.0)\\nReclassification of prior service credits (2,691) (2,680) (2,442) (0.4) (9.7)\\nCertain significant items (28,107) (296) (19,118) — 98.5\\nAT&T Operating Income (Loss) $ (4,587) $ 25,897 $ 8,372 —% —%Management’s Discussion and Analysis of Financial Condition and Results of Operations\\nDollars in millions except per share amounts\\n;',\n", " 'TheCommunications segment accounted for\\napproximately 97% of our 2022 total segment operatingrevenues compared to 98% in 2021 and accounted for allsegment operating income in 2022 and 2021. This segmentprovides services to businesses and consumers located inthe U.S. and businesses globally. Our business strategiesreflect bundled product offerings that cut across productlines and utilize shared assets. This segment contains thefollowing business units:\\n•Mobility provides nationwide wireless service and\\nequipment.\\n•Business Wireline provides advanced ethernet-based\\nfiber services, IP Voice and managed professionalservices, as well as traditional voice and data servicesand related equipment to business customers.\\n•Consumer Wireline provides broadband services,\\nincluding fiber connections that provide our multi-gigservices to residential customers in select locations.Consumer Wireline also provides legacy telephonyvoice communication services.TheLatin America segment accounted for approximately\\n3% of our 2022 total segment operating revenuescompared to 2% in 2021. This segment provides wirelessservices and equipment in Mexico.\\nRESULTS OF OPERATIONS\\nConsolidated Results Our financial results from\\ncontinuing operations are summarized in the followingtable. We then discuss factors affecting our overall resultsfrom continuing operations. Additional analysis isdiscussed in our “Segment Results” section. We alsodiscuss our expected revenue and expense trends for2023 in the “Operating Environment and Trends of theBusiness” section. Certain prior-period amounts havebeen reclassified to conform to the current period’spresentation.\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nOperating revenues\\nService $ 97,831 $ 111,565 $ 124,057 (12.3)% (10.1)%\\nEquipment 22,910 22,473 18,993 1.9 18.3\\nTotal Operating Revenues 120,741 134,038 143,050 (9.9) (6.3)\\nOperating expenses\\nOperations and support 79,809 90,076 96,468 (11.4) (6.6)\\nAsset impairments and abandonments\\nand restructuring 27,498 213 15,687 — (98.6)\\nDepreciation and amortization 18,021 17,852 22,523 0.9 (20.7)\\nTotal Operating Expenses 125,328 108,141 134,678 15.9 (19.7)\\nOperating Income (Loss) (4,587) 25,897 8,372 — —\\nInterest expense 6,108 6,716 7,727 (9.1) (13.1)\\nEquity in net income of affiliates 1,791 603 89 — —\\nOther income (expense) – net 5,810 9,387 (1,088) (38.1) —\\nIncome (Loss) from Continuing Operations\\nBefore Income Taxes (3,094) 29,171 (354) — —\\nIncome (Loss) from Continuing Operations $ (6,874) $ 23,776 $ (1,522) —% —%\\n?',\n", " 'OVERVIEW\\nOperating revenues decreased in 2022 and 2021. The\\n2022 decline reflects the July 31, 2021 separation of the U.S.video business, other business divestitures that were notincluded in discontinued operations and lower BusinessWireline revenues driven by lower demand for legacyservices and product simplification. Partially offsettingdeclines were higher Mobility service and equipmentrevenues and, to a lesser extent, gains in broadbandservice in our Communications segment and growth inMexico wireless operations.\\nThe 2021 decline reflects the 2021 separation of the U.S.\\nvideo business and the October 2020 sale of wireless andwireline operations in Puerto Rico and the U.S. VirginIslands. Also contributing to revenue declines was lowerBusiness Wireline revenues due in part to higher demandfor pandemic-related connectivity in the prior year.Partially offsetting declines were higher Mobilityequipment and service revenues and gains in broadbandservice, and growth in Mexico wireless operationsincluding favorable foreign exchange impacts.\\nOperations and support expenses decreased in 2022 and\\n2021. The 2022 decline reflects the separation of U.S. videoand lower personnel costs associated with ongoingtransformation initiatives, partially offset by higher baddebt expense, the elimination of Connect America FundPhase II (CAF II) government credits and increasedwholesale network access charges. Wireless equipmentcosts were up slightly, with higher sales volumes and thesale of higher-priced smartphones largely offset by lower3G shutdown costs in 2022. In the first quarter of 2022, weupdated the expected economic lives of customerrelationships, which extended the amortization period ofdeferred acquisition and fulfillment costs and reducedexpenses approximately $395, with $150 recorded toMobility, $115 to Business Wireline and $130 to ConsumerWireline.\\nThe 2021 decline reflects our 2021 business divestitures,\\nlower bad debt expense and lower personnel costsassociated with our transformation initiatives. Declineswere mostly offset by increased domestic wirelessequipment expense from higher volumes.\\nAsset impairments and abandonments and\\nrestructuring increased in 2022 and decreased in 2021.\\nThe increase in 2022 was primarily due to $24,812 ofnoncash goodwill impairments associated with ourBusiness Wireline, Consumer Wireline and Mexicoreporting units and were driven by higher interest ratesconsistent with the macroeconomic environment, withsecular declines also impacting Business Wireline growthrates (see Note 9). The increase in 2022 also included$1,413 of wireline conduit asset abandonments (see Note7) and $1,273 of restructuring and other impairmentcharges due to updated network build plans stemmingfrom spectrum acquired in recent auctions, severancecharges associated with transformation initiatives andimpairment of personal protective equipment inventory.Impairment charges in 2021 were lower than 2020,\\nreflecting a fourth-quarter 2020 impairment charge of$15,508 resulting from our assessment of therecoverability of the long-lived assets and goodwillassociated with our U.S. video business.\\nDepreciation and amortization expense increased in\\n2022 and decreased in 2021.\\nDepreciation expense increased $218, or 1.2%, in 2022.\\nThe increase was primarily due to ongoing capitalinvestment for strategic initiatives such as fiber andnetwork upgrades and expansion, partially offset byhigher estimated lives of our fiber assets (see Note 7).Depreciation expense decreased $1,394, or 7.3%, in 2021,primarily due to ceasing depreciation on U.S. video held-for-sale assets.\\nAmortization expense decreased $49, or 22.5%, in 2022\\nand $3,277, or 93.8%, in 2021. Lower amortizationreflects our accelerated method of amortization ofintangible assets from previous acquisitions and ceasingamortization on U.S. video held-for-sale assets in 2021.\\nOperating income decreased in 2022 and increased in\\n2021. Our operating margin was (3.8)% in 2022, comparedto 19.3% in 2021 and 5.9% in 2020.\\nInterest expense decreased in 2022 primarily due to\\nlower debt balances and higher capitalized interestassociated with spectrum acquisitions, partially offset byhigher interest rates. Interest expense decreased in 2021primarily due to lower interest rates and higher capitalizedinterest associated with spectrum acquisitions, partiallyoffset by higher debt balances.\\nEquity in net income of affiliates increased in 2022 and\\n2021, primarily due to the close of our transaction withTPG related to the U.S. video business, which resulted inour accounting for our investment in DIRECTV under theequity method of accounting beginning August 1, 2021(see Notes 6, 10 and 19).\\nOther income (expense) – net decreased in 2022\\nprimarily due to lower actuarial gains ($1,999 in 2022compared to $4,140 in 2021), lower pension andpostretirement benefit credits and lower returns on otherbenefit-related investments. Pension and postretirementbenefit credits decreased as a result of higher assumeddiscount rates and lower returns on benefit plan assets.Our 2022 benefit expense also includes approximately$280 favorable impact from a retirement benefit planchange, with $230 resulting from prior service credits(approximately $100 for Business Wireline, $80 forConsumer Wireline and $40 for Mobility) (see Note 14).\\nThe increase in 2021 was primarily due to the recognition\\nof $4,140 in actuarial gains, compared to losses of $4,169in 2020, and the recognition of $1,405 of debt redemptioncosts in 2020. Also contributing to increased income in2021 were higher net pension and postretirement benefitcredits from higher prior service credit amortization (seeNote 14).Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n!',\n", " 'Income tax expense decreased in 2022 and increased in\\n2021. The 2022 decrease was primarily driven by lowerincome before income tax offset by impairments ofgoodwill (see Note 9), which are not deductible for taxpurposes.\\nThe increase in 2021 was primarily due to increased\\nincome before income taxes, offset primarily by theCoronavirus Aid, Relief, and Economic Security Act (CARESAct) benefit of U.S. federal Net Operating Loss (NOL)carryback and benefits of divestitures in 2021.\\nOur effective tax rate was (122.2)% in 2022, 18.5% in 2021,\\nand (329.9)% in 2020. The effective tax rate was impactedby our goodwill impairments associated with our BusinessWireline, Consumer Wireline and Mexico reporting units in2022, and Video goodwill impairment in 2020, which arenot deductible for tax purposes.\\nSegment Results Our segments are strategic business\\nunits that offer different products and services overvarious technology platforms and/or in differentgeographies that are managed accordingly. We alsoevaluate segment performance based on EBITDA and/orEBITDA margin, which is defined as operating incomeexcluding depreciation and amortization. EBITDA is used\\nas part of our management reporting and we believeEBITDA to be a relevant and useful measurement to ourinvestors as it measures the cash generation potential ofour business units. EBITDA does not give effect todepreciation and amortization expenses incurred inoperating income nor is it burdened bycash used for debt\\nservice requirements and thus does not reflect availablefunds for distributions, reinvestment or otherdiscretionary uses. EBITDA margin is EBITDA divided bytotal revenues.\\nIn the first quarter of 2022, we reclassified into “Corporate”\\ncertain administrative costs borne by AT&T where thebusiness units do not influence decision making toconform with the current period presentation. This recastincreased Corporate operations and support expenses byapproximately $270 and $1,310 for full-year 2021 and 2020,respectively. Correspondingly, this recast loweredadministrative expenses for the Communicationssegment, with no change on a consolidated basis.\\nCOMMUNICATIONS SEGMENT\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nSegment Operating Revenues\\nMobility $ 81,780 $ 78,254 $ 72,564 4.5 % 7.8 %\\nBusiness Wireline 22,538 23,937 25,083 (5.8) (4.6)\\nConsumer Wireline 12,749 12,539 12,318 1.7 1.8\\nTotal Segment Operating Revenues $ 117,067 $ 114,730 $ 109,965 2.0 % 4.3 %\\nSegment Operating Income\\nMobility $ 24,528 $ 23,370 $ 22,801 5.0 % 2.5 %\\nBusiness Wireline 3,252 4,027 4,799 (19.2) (16.1)\\nConsumer Wireline 1,327 996 1,462 33.2 (31.9)\\nTotal Segment Operating Income $ 29,107 $ 28,393 $ 29,062 2.5 % (2.3)%\\nSelected Subscribers and Connections\\nDecember 31,\\n(000s) 2022 2021 2020\\nMobility subscribers 217,397 201,791 182,558\\nTotal domestic broadband connections 15,386 15,504 15,384\\nNetwork access lines in service 5,213 6,177 7,263\\nU-verse VoIP connections 2,930 3,333 3,816\\nOperating revenues increased in 2022, driven by\\nincreases in our Mobility and Consumer Wireline businessunits, partially offset by a decrease in our BusinessWireline business unit. The increases are primarily drivenby wireless service and equipment revenue growth andgains in broadband service. Business Wireline continues toreflect lower demand for legacy services and productsimplification.Operating income increased in 2022 and decreased in\\n2021. The 2022 operating income reflects an increase inoperating income from our Mobility and ConsumerWireline business units, partially offset by declines in ourBusiness Wireline business unit. Our Communicationssegment operating income margin was 24.9% in 2022,24.7% in 2021 and 26.4% in 2020.\\n¿',\n", " 'Communications Business Unit Discussion\\nMobility Results\\nPercent Change\\n2022 2021 20202022 vs. 2021 2021 vs. 2020\\nOperating revenues\\nService $ 60,499 $ 57,590 $ 55,542 5.1 % 3.7 %\\nEquipment 21,281 20,664 17,022 3.0 21.4\\nTotal Operating Revenues 81,780 78,254 72,564 4.5 7.8\\nOperating expenses\\nOperations and support 49,054 46,762 41,677 4.9 12.2\\nDepreciation and amortization 8,198 8,122 8,086 0.9 0.4\\nTotal Operating Expenses 57,252 54,884 49,763 4.3 10.3\\nOperating Income $ 24,528 $ 23,370 $ 22,801 5.0 % 2.5 %\\nThe following tables highlight other key measures of performance for Mobility:\\nSubscribers\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nPostpaid 84,700 81,534 77,154 3.9 % 5.7 %\\nPostpaid phone 69,596 67,260 64,216 3.5 4.7\\nPrepaid 19,176 19,028 18,102 0.8 5.1\\nReseller 6,043 6,113 6,535 (1.1) (6.5)\\nConnected devices1107,478 95,116 80,767 13.0 17.8\\nTotal Mobility Subscribers2217,397 201,791 182,558 7.7 % 10.5 %\\n1Includes data-centric devices such as session-based tablets, monitoring devices and primarily wholesale automobile systems.\\n2Wireless subscribers at December 31, 2022 excludes the impact of 10,176 subscriber and connected device disconnections resulting from our 3G networ k shutdown in\\nFebruary 2022. Postpaid disconnections were 897, including 437 phone, 234 prepaid, 749 reseller subscribers, and 8,296 connected devices.\\nMobility Net Additions\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nPostpaid Phone Net Additions 2,868 3,196 1,457 (10.3) % —%\\nTotal Phone Net Additions 3,272 3,850 1,640 (15.0) —\\nPostpaid24,091 4,482 2,183 (8.7) —\\nPrepaid 479 956 379 (49.9) —\\nReseller 462 (534) (449) — (18.9)\\nConnected devices320,594 14,328 14,785 43.7 (3.1)\\nMobility Net Subscriber Additions125,626 19,232 16,898 33.2 % 13.8 %\\nPostpaid Churn40.97 % 0.94 % 0.98 % 3B P (4) BP\\nPostpaid Phone-Only Churn40.81 % 0.76 % 0.79 % 5B P (3) BP\\n1Excludes migrations and acquisition-related additions during the period.\\n2In addition to postpaid phones, includes tablets and wearables and other. Tablet net adds (losses) were 203, 28 and (512) for the years ended December 3 1, 2022, 2021 and\\n2020, respectively. Wearables and other net adds were 1,020, 1,258 and 1,238 for the years ended December 31, 2022, 2021 and 2020, respectively.\\n3Includes data-centric devices such as session-based tablets, monitoring devices and primarily wholesale automobile systems. Excludes postpaid t ablets and other\\npostpaid data devices. Wholesale connected car net adds were approximately 9,980, 7,875 and 9,890 for the years ended December 31, 2022, 2021 and 2020 , respectively.\\n4Calculated by dividing the aggregate number of wireless subscribers who canceled service during a month by the total number of wireless subscribers a t the beginning\\nof that month. The churn rate for the period is equal to the average of the churn rate for each month of that period, excluding the impact of disconnection s resulting\\nfrom our 3G network shutdown in February 2022.Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)Dollars in millions except per share amounts\\n\\t\\x08',\n", " 'Service revenue increased during 2022, largely due to\\ngrowth from subscriber gains and postpaid averagerevenue per subscriber (ARPU) growth.\\nARPU\\nARPU increased in 2022 and reflects pricing actions,improved international roaming and customers shiftingto higher priced unlimited plans, partially offset by theimpact of higher promotional discount amortization(see Note 5).\\nChurn\\nThe effective management of subscriber churn is criticalto our ability to maximize revenue growth and tomaintain and improve margins. Postpaid churn andpostpaid phone-only churn were higher in 2022 due to areturn to pre-pandemic customer behavior, as well aspricing actions and the resulting increase in bothvoluntary and involuntary disconnects.\\nEquipment revenue increased in 2022, primarily driven by\\na higher volume of devices sold and a mix of higher-pricedpostpaid smartphones.\\nOperations and support expenses increased in 2022\\n,\\nlargely driven by growth in equipment sales and\\nassociated expenses, bad debt expense, higher network\\ncosts, the elimination of CAF II government credits, and\\nhigher HBO Max licensing fees and FirstNet costs. In the\\nfirst quarter of 2022, we updated our analysis of economic\\nlives of customer relationships and extended the\\namortization period of Mobility deferred customer\\ncontract costs, which decreased expense approximately\\n$150.Depreciation expense increased in 2022, primarily due to\\nongoing capital spending for network upgrades andexpansion, partially offset by ceasing use of 3G networkassets.\\nOperating income increased in 2022 and 2021. Our\\nMobility operating income margin was 30.0% in 2022,29.9% in 2021 and 31.4% in 2020. Our Mobility EBITDAmargin was 40.0% in 2022, 40.2% in 2021 and 42.6% in2020.\\nSubscriber Relationships\\nAs the wireless industry has matured, with nearly full\\npenetration of smartphones in the U.S. population, futurewireless growth will depend on our ability to offerinnovative services, plans and devices that bundle productofferings and take advantage of our 5G wireless network.We believe 5G opens up vast possibilities of connectingsensors, devices, and autonomous things, commonlyreferred to as the Internet of Things (IoT). More and more,these devices are performing use cases that require highbandwidth, ultra-reliability and low latency that only 5Gand edge computing can bring. To support higher mobiledata usage, our priority is to best utilize a wir\\neless\\nnetwork that has sufficient spectrum and capacity to\\nsupport these innovations on as broad a geographic basis\\nas possible.\\nBusiness Wireline Results\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nOperating revenues\\nService $ 21,891 $ 23,224 $ 24,313 (5.7)% (4.5)%\\nEquipment 647 713 770 (9.3) (7.4)\\nTotal Operating Revenues 22,538 23,937 25,083 (5.8) (4.6)\\nOperating expenses\\nOperations and support 13,972 14,718 15,068 (5.1) (2.3)\\nDepreciation and amortization 5,314 5,192 5,216 2.3 (0.5)\\nTotal Operating Expenses 19,286 19,910 20,284 (3.1) (1.8)\\nOperating Income $ 3,252 $ 4,027 $ 4,799 (19.2)% (16.1)%\\nService revenues decreased in 2022, driven by lower\\ndemand for legacy voice and data services and productsimplification. Also contributing to the decline was lowerrevenues from the government sector. We expect thesetrends to continue. Partially offsetting revenue declineswas growth in connectivity services and revenues ofapproximately $200 from intellectual property sales in2022.Equipment revenues decreased in 2022, driven by declines\\nin legacy and non-core services which we expect tocontinue.\\nOperations and support expenses decreased in 2022,\\nprimarily due to our continued efforts to drive efficienciesin our network operations through automation,reductions in customer support expenses through\\n\\t\\t',\n", " 'digitization and proactive rationalization of low profit\\nmargin products, and lower personnel costs associatedwith ongoing transformation initiatives. Expense declineswere also driven by credits from a third-quarter 2022retirement benefit plan change and lower amortization ofdeferred fulfillment costs, including our first-quarter 2022updates to the estimated economic lives of subscribers,which decreased expense approximately $115 in 2022. Thedeclines were partially offset by higher wholesale accessnetwork costs. As part of our transformation activities, weexpect continued operations and support expenseimprovements into 2023 as we further size our operationsin alignment with the strategic direction of the business.Depreciation expense increased in 2022, primarily due to\\nongoing capital investment for strategic initiatives such asfiber and network upgrades and expansion, partially offsetby updates to extend the estimated lives of our fiberassets (see Note 7).\\nOperating income decreased in 2022 and 2021. Our\\nBusiness Wireline operating income margin was 14.4% in2022, 16.8% in 2021 and 19.1% in 2020. Our BusinessWireline EBITDA margin was 38.0% in 2022, 38.5% in 2021and 39.9% in 2020.\\nConsumer Wireline Results\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nOperating revenues\\nBroadband $ 9,669 $ 9,085 $ 8,534 6.4 % 6.5 %\\nLegacy voice and data services 1,746 1,977 2,213 (11.7) (10.7)\\nOther service and equipment 1,334 1,477 1,571 (9.7) (6.0)\\nTotal Operating Revenues 12,749 12,539 12,318 1.7 1.8\\nOperating expenses\\nOperations and support 8,253 8,448 7,942 (2.3) 6.4\\nDepreciation and amortization 3,169 3,095 2,914 2.4 6.2\\nTotal Operating Expenses 11,422 11,543 10,856 (1.0) 6.3\\nOperating Income $ 1,327 $ 996 $ 1,462 33.2 % (31.9)%\\nThe following tables highlight other key measures of performance for Consumer Wireline:\\nConnections\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nBroadband Connections\\nTotal Broadband and DSL Connections 13,991 14,160 14,100 (1.2)% 0.4 %\\nBroadband 13,753 13,845 13,693 (0.7) 1.1\\nFiber Broadband Connections 7,215 5,992 4,951 20.4 21.0\\nVoice Connections\\nRetail Consumer Switched Access Lines 2,028 2,423 2,862 (16.3) (15.3)\\nU-verse Consumer VoIP Connections 2,311 2,736 3,231 (15.5) (15.3)\\nTotal Retail Consumer Voice Connections 4,339 5,159 6,093 (15.9)% (15.3)%\\nBroadband Net Additions\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nTotal Broadband and DSL Net Additions (169) 60 (19) —% —%\\nBroadband Net Additions (92) 152 95 — 60.0\\nFiber Broadband Net Additions 1,223 1,041 1,064 17.5 % (2.2)%Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n\\t ',\n", " 'Broadband revenues increased in 2022, driven by an\\nincrease in fiber customers, which we expect to continuefor the foreseeable future as we invest further in buildingour fiber footprint, partially offset by declines in copper-based broadband services.\\nLegacy voice and data service revenues decreased in\\n2022, reflecting the continued decline in the number ofcustomers, which we expect to continue.\\nOther service and equipment revenues decreased in\\n2022, reflecting the continued decline in the number ofVoIP customers, which we expect to continue.\\nOperations and support expenses decreased in 2022,\\nprimarily driven by lower network and customer supportcosts, credits from a third-quarter 2022 retirement benefitplan change and lower HBO Max licensing fees. Alsocontributing to the decline was lower amortization ofdeferred fulfillment costs, including our first-quarter 2022\\nupdates to the estimated economic lives of broadband/fiber subscribers, which decreased expensesapproximately $130 in 2022. These declines were partiallyoffset by the elimination of CAF II government credits,higher bad debt expense and advertising costs.\\nDepreciation expense increased in 2022, primarily due to\\nongoing capital investment for strategic initiatives such asfiber and network upgrades and expansion, partially offsetby updates to the estimated lives of our fiber assets (seeNote 7).\\nOperating income increased in 2022 and decreased in\\n2021. Our Consumer Wireline operating income marginwas 10.4% in 2022, 7.9% in 2021 and 11.9% in 2020. OurConsumer Wireline EBITDA margin was 35.3% in 2022,32.6% in 2021 and 35.5% in 2020.\\nLATIN AMERICA SEGMENT\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nOperating revenues\\nService $ 2,162 $ 1,834 $ 1,656 17.9 % 10.7 %\\nEquipment 982 913 906 7.6 0.8\\nTotal Operating Revenues 3,144 2,747 2,562 14.5 7.2\\nOperating expenses\\nOperations and support 2,812 2,652 2,636 6.0 0.6\\nDepreciation and amortization 658 605 513 8.8 17.9\\nTotal Operating Expenses 3,470 3,257 3,149 6.5 3.4\\nOperating Income (Loss) $ (326) $ (510) $ (587) 36.1 % 13.1 %\\nThe following tables highlight other key measures of performance for Mexico:\\nSubscribers\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nPostpaid 4,925 4,807 4,696 2.5 % 2.4 %\\nPrepaid 16,204 15,057 13,758 7.6 9.4\\nReseller 474 498 489 (4.8) 1.8\\nMexico Wireless Subscribers 21,603 20,362 18,943 6.1 % 7.5 %\\nMexico Wireless Net Additions\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nPostpaid 118 111 (407) 6.3 % —%\\nPrepaid 1,147 1,299 174 (11.7) —\\nReseller (24) 9 118 — (92.4)\\nMexico Wireless Net Additions 1,241 1,419 (115) (12.5)% —%\\nService revenues increased in 2022, reflecting growth in\\nwholesale services, subscribers and ARPU.\\nEquipment revenues increased in 2022, due to higher\\nequipment sales.\\nOperations and support expenses increased in 2022, due\\nto higher acquisition costs, bad debt and networkexpenses. Approximately 5% of Mexico expenses are U.S.dollar-based, with the remainder in the local currency.Depreciation expense increased in 2022, reflecting higher\\nin-service assets.\\nOperating income improved in 2022 and 2021. Our Mexico\\noperating income margin was (10.4)% in 2022, (18.6)% in2021 and (22.9)% in 2020. Our Mexico EBITDA margin was10.6% in 2022, 3.5% in 2021 and (2.9)% in 2020.\\n\\t.',\n", " 'OPERATING ENVIRONMENT AND TRENDS OF THE\\nBUSINESS\\n2023 Revenue Trends We expect revenue growth in our\\nwireless and broadband businesses as customers demandinstant connectivity and higher speeds made possible bywireless network enhancements through 5G deploymentand our fiber network expansion. We believe that oursimplified go-to-market strategy for 5G inunderpenetrated markets will continue to contribute towireless subscriber and service revenue growth and thatexpansion of our fiber footprint and our multi-gigofferings will drive greater demand for broadbandservices on our fast-growing fiber network.\\nAs we expand our fiber reach, we will be orienting our\\nbusiness portfolio to leverage this opportunity to offsetcontinuing declines in legacy Business Wireline productsby growing connectivity with small to mid-sizedbusinesses. We plan to use our strong fiber and wirelessassets, broad distribution and converged product offersto strengthen our overall market position. We willcontinue to rationalize our product portfolio with alonger-term shift of the business to fiber and mobileconnectivity, and growth in value-added services .\\n2023 Expense Trends We expect the spending required to\\nsupport growth initiatives, primarily our continueddeployment of fiber and 5G to pressure expense trends in2023. To the extent customers further upgrade theirhandsets in 2023, the expenses associated with thosedevice sales are expected to contribute to higher costs.During 2023, we will also continue to prioritize efficiency,led by our cost transformation initiative. Theseinvestments will help prepare us to meet increasedcustomer demand for enhanced wireless and broadbandservices, including video streaming, augmented reality and“smart” technologies. The software benefits of our 5Gwireless technology should result in a more efficient useof capital and lower network-related expenses in thecoming years.\\nWe continue to transform our operations to be more\\nefficient and effective. We are restructuring businesses,sunsetting legacy networks, improving customer serviceand ordering functions through digital transformation,sizing our support costs and staffing with current activitylevels, and reassessing overall benefit costs. Cost savingsand asset sales align with our focus on debt reduction.Market Conditions The U.S. stock market experienced\\nvolatility and contraction in 2022. Several factors, includingthe continued impact from the global pandemic, haveresulted in changes in demand in business communicationservices. The global pandemic has caused, and could againcause, delays in the development, manufacturing(including the sourcing of key components) and shipmentof products, as well as continued tight labor market andactual or perceived inflation. Most of our products andservices are not directly affected by the imposition oftariffs on Chinese goods. However, we expect ongoingpressure on pricing during 2023 as we respond to thegeopolitical and macroeconomic environment and ourcompetitive marketplace, especially in wireless services.\\nIncluded on our consolidated balance sheets are assets\\nheld by benefit plans for the payment of future benefits.Our pension plans are subject to funding requirements ofthe Employee Retirement Income Security Act of 1974, asamended (ERISA). We expect only minimal ERISAcontribution requirements to our pension plans for 2023.Investment returns on these assets depend largely ontrends in the economy, and a weakness in the equity, fixedincome and real asset markets could require us to makefuture contributions to the pension plans. In addition, ourpolicy of recognizing actuarial gains and losses related toour pension and other postretirement plans in the periodin which they arise subjects us to earnings volatilitycaused by changes in market conditions; however, theseactuarial gains and losses do not impact segmentperformance as they are required to be recorded in “Otherincome (expense) – net.” Changes in our discount rate,which are tied to changes in the bond market, andchanges in the performance of equity markets, may havesignificant impacts on the valuation of our pension andother postretirement obligations at the end of 2023 (see“Critical Accounting Policies and Estimates”).Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n\\t:',\n", " 'OPERATING ENVIRONMENT OVERVIEW\\nAT&T subsidiaries operating within the United States are\\nsubject to federal and state regulatory authorities. AT&Tsubsidiaries operating outside the United States aresubject to the jurisdiction of national and supranationalregulatory authorities in the markets where service isprovided.\\nIn the Telecommunications Act of 1996 (Telecom Act),\\nCongress established a national policy frameworkintended to bring the benefits of competition andinvestment in advanced telecommunications facilities andservices to all Americans by opening alltelecommunications markets to competition andreducing or eliminating regulatory burdens that harmconsumer welfare. Nonetheless, over the ensuing twodecades, the Federal Communications Commission (FCC)and some state regulatory commissions have maintainedor expanded certain regulatory requirements that wereimposed decades ago on our traditional wirelinesubsidiaries when they operated as legal monopolies.More recently, the FCC has pursued a more deregulatoryagenda, eliminating a variety of antiquated andunnecessary regulations and streamlining its processes ina number of areas. We continue to support regulatory andlegislative measures and efforts, at both the state andfederal levels, to reduce inappropriate regulatory burdensthat inhibit our ability to compete effectively and offerneeded services to our customers, including initiatives totransition services from traditional networks to all IP-based networks. At the same time, we also seek to ensurethat legacy regulations are not further extended tobroadband or wireless services, which are subject tovigorous competition.\\nInternet The FCC currently classifies fixed and mobile\\nconsumer broadband services as information services,subject to light-touch regulation. However, some stateshave adopted legislation or issued executive orders thatwould reimpose net neutrality rules repealed by the FCC.Suits were filed concerning such laws in California andVermont. The California suit was dismissed withoutprejudice on May 4, 2022, and the California statute is nowin effect. The litigation challenging the Vermont statutehas been stayed pending the Second Circuit’s dispositionof an appeal by the State of New York of an orderenjoining enforcement of a New York statute regulatingbroadband rates on the ground that such statute ispreempted by federal law. We expect additional statesmay seek to impose net neutrality requirements in thefuture.\\nOn November 15, 2021, the Infrastructure Investment and\\nJobs Act (IIJA) was signed into law. The legislationappropriates $65,000 to support broadband deploymentand adoption. The National Telecommunications andInformation Agency (NTIA) is responsible for distributingmore than $48,000 of this funding, including $42,500 instate grants for broadband deployment projects inunserved and underserved areas. NTIA established initialrequirements for this program in May 2022 and isexpected to announce state grant allocations in 2023.The IIJA also appropriated $14,200 for establishment of\\nthe Affordable Connectivity Program (ACP), an FCC-administered monthly, low-income broadband benefitprogram, replacing the Emergency Broadband Benefitprogram (established in December 2020 by theConsolidated Appropriations Act, 2021). Qualifyingcustomers can receive up to thirty dollars per month (orseventy-five dollars per month for those on Tribal lands)to assist with their internet bill. AT&T is a participatingprovider in the ACP program and will considerparticipating in the deployment program whereappropriate. The IIJA includes various provisions that haveresulted in FCC proceedings regarding ACP programadministration and consumer protection, reform of theexisting universal support program, and broadbandlabeling and equal access.\\nPrivacy-related legislation continues to be adopted or\\nconsidered in a number of jurisdictions. Legislative,regulatory and litigation actions could result in increasedcosts of compliance, further regulation or claims againstbroadband internet access service providers and others,and increased uncertainty in the value and availability ofdata.\\nWireless Industry-wide network densification and 5G\\ntechnology expansion efforts, which are needed to satisfyextensive demand for video and internet access, willinvolve significant deployment of “small cell” equipment.This increases the importance of local permittingprocesses that allow for the placement of small cellequipment in the public right-of-way on reasonabletimelines and terms. The FCC has adopted multiple Ordersstreamlining federal, state, and local wireless structurereview processes that had the tendency to delay andimpede deployment of small cell and relatedinfrastructure used to provide telecommunications andbroadband services. During 2020-2021, we have alsodeployed 5G nationwide on “low band” spectrum onmacro towers. Executing on the recent spectrumpurchase, we announced ongoing construction andcontinuing deployment of 5G on C-band spectrum in 2022and beyond.\\nEXPECTED GROWTH AREAS\\nOver the next few years, we expect our growth to come\\nfrom wireless and IP-based fiber broadband services. Weprovide integrated services to diverse groups ofcustomers in the U.S. on an integratedtelecommunications network utilizing differenttechnological platforms. In 2023, our key initiatives include:\\n• Continuing our wireless subscriber momentum and\\n5G deployment, with expansion of 5G service,\\nincluding to underpenetrated markets.\\n• Improving fiber penetration, accelerating subscriber\\ngrowth and increasing broadband revenues.\\n• Continuing to drive efficiencies and a competitive\\nadvantage through cost transformation initiatives\\nand product simplification.\\n\\t,',\n", " 'Wireless We expect to continue to deliver revenue\\ngrowth in the coming years. We are in a period of rapidgrowth in wireless video usage and believe that there aresubstantial opportunities available for next-generationconverged services that combine technologies andservices. As of December 31, 2022, we served 239 millionwireless subscribers in North America, with more than 217million in the United States.\\nOur LTE technology covers over 441 million people in\\nNorth America, and in the United States, we cover allmajor metropolitan areas and over 337 million people. Wealso provide 4G coverage using another technology(HSPA+), and when combined with our upgraded backhaulnetwork, we provide enhanced network capabilities andsuperior mobile broadband speeds for data and videoservices. In December 2018, we introduced the nation’sfirst commercial mobile 5G service and expanded thatdeployment nationwide in July 2020. At December 31,2022, our network covers more than 285 million peoplewith 5G technology in the United States and NorthAmerica.\\nOur networks covering both the U.S. and Mexico have\\nenabled our customers to use wireless services withoutroaming on other companies’ networks. We believe thisseamless access will prove attractive to customers andprovide a significant growth opportunity. At December 31,2022, we provided LTE coverage to over 104 million peoplein Mexico.\\nIntegration of Data and Broadband Services As the\\ncommunications industry has evolved into internet-basedtechnologies capable of blending wireline and wirelessservices, we plan to focus on expanding our wirelessnetwork capabilities and provide broadband offerings thatallow customers to integrate their home or business fixedservices with their mobile service. In January 2022, welaunched our multi-gig rollout, which brings the fastestinternet to AT&T Fiber customers with symmetrical 2 gigand 5 gig tiers. We will continue to develop and provideunique integrated mobile and broadband/fiber solutions.\\nREGULATORY DEVELOPMENTS\\nSet forth below is a summary of the most significant\\nregulatory proceedings that directly affected ouroperations during 2022. Industry-wide regulatorydevelopments are discussed above in OperatingEnvironment Overview. While these issues may apply onlyto certain subsidiaries, the words “we,” “AT&T” and “our”are used to simplify the discussion. The followingdiscussions are intended as a condensed summary of theissues rather than as a comprehensive legal analysis anddescription of all of these specific issues.\\nInternational Regulation Our subsidiaries operating\\noutside the United States are subject to the jurisdiction ofregulatory authorities in the territories in which thesubsidiaries operate. Our licensing, compliance andadvocacy initiatives in foreign countries primarily enablethe provision of enterprise (i.e., large business) servicesglobally and wireless services in Mexico.The General Data Protection Regulation went into effect\\nin Europe in May of 2018. AT&T processes and handlespersonal data of its customers and subscribers,employees of its enterprise customers and its employees.This regulation created a range of new complianceobligations and significantly increased financial penaltiesfor noncompliance.\\nFederal Regulation We have organized our following\\ndiscussion by service impacted.\\nInternet The FCC currently classifies fixed and mobile\\nconsumer broadband services as information services,subject to light-touch regulation. The D.C. Circuit upheldthe FCC’s current classification, although it remandedthree discrete issues to the FCC for further consideration.These issues related to the effect of the FCC’s decision toclassify broadband services as information services onpublic safety, the regulation of pole attachments, anduniversal service support for low-income consumersthrough the Lifeline program. Because no party soughtSupreme Court review of the D.C. Circuit’s decision touphold the FCC’s classification of broadband as aninformation service, that decision is final.\\nIn October 2020, the FCC adopted an order addressing the\\nthree issues remanded by the D.C. Circuit for furtherconsideration. After considering those issues, the FCCconcluded there were no grounds to depart from itsdetermination that fixed and mobile consumer broadbandservices should be classified as information services. Anappeal of the FCC’s remand decision is pending.\\nSome states have adopted legislation or issued executive\\norders that would reimpose net neutrality rules repealedby the FCC. Suits were filed concerning such laws inCalifornia and Vermont. The California suit was dismissedwithout prejudice on May 4, 2022, and the Californiastatute is now in effect. The litigation challenging theVermont statute has been stayed pending the SecondCircuit’s disposition of an appeal by the State of New Yorkof an order enjoining enforcement of a New York statuteregulating broadband rates on the ground that suchstatute is preempted by federal law. We expect additionalstates may seek to impose net neutrality requirements inthe future.\\nOn November 15, 2021, President Biden signed the IIJA into\\nlaw. The legislation appropriates funds to supportbroadband deployment and adoption. The NTIA isresponsible for distributing the majority of these fundsprimarily through state grants for broadband deploymentprojects in unserved and underserved areas, and to alesser extent for middle mile broadband infrastructure,and digital equity programs. On May 13, 2022, NTIA issuedthree Notices of Funding Opportunity for these initiatives– the Broadband Equity, Access, and Deployment Program,the Enabling Middle Mile Broadband InfrastructureProgram, and the State Digital Equity Program. NTIA willcontinue to administer and implement these programs.The IIJA also appropriated funds for establishment of theACP, an FCC-administered monthly, low-incomeManagement’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n\\t;',\n", " 'broadband benefit program, replacing the Emergency\\nBroadband Benefit program. Qualifying customers canreceive reimbursements to assist with their internet bill.AT&T is a participating provider in the ACP program andwill consider participating in the deployment programwhere appropriate. The IIJA includes various provisionsthat have resulted in FCC proceedings regarding ACPprogram administration and consumer protection, reformof the existing universal support program, and broadbandlabeling and equal access.\\nPrivacy-related legislation continues to be adopted or\\nconsidered in a number of jurisdictions. Legislative,regulatory and litigation actions could result in increasedcosts of compliance, further regulation or claims againstbroadband internet access service providers and others,and increased uncertainty in the value and availability ofdata.\\nWireless and Broadband In June and November 2020, the\\nFCC issued a Declaratory Ruling clarifying the limits onstate and local authority to deny applications to modifyexisting structures to accommodate wireless facilities.Appeals of the November 2020 order remain pending inthe Ninth Circuit Court of Appeals, following multiplerequests by the FCC to hold the appeal in abeyance untilthe Senate confirms a fifth FCC Commissioner. Ifsustained on appeal, these FCC decisions will removestate and local regulatory barriers and reduce the costs ofthe infrastructure needed for 5G and FirstNetdeployments, which will enhance our ability to place smallcell facilities on utility poles, expand existing facilities toaccommodate public safety services, and replace legacyfacilities and services with advanced broadbandinfrastructure and services. During 2022, we have alsodeployed 5G nationwide on “low band” spectrum onmacro towers. Executing on the recent spectrumpurchase, we continued deploying 5G nationwide on “lowband” spectrum.\\nIn March 2020, the FCC released its order setting rules for\\ncertain spectrum bands (C-band) for 5G operations. Inthat order, the FCC concluded that C-band 5G servicesthat met the agency’s technical limits on power andemissions would not cause harmful interference withaircraft operations. In reliance on that order, AT&T bid atotal of $23,406 and was awarded 1,621 C-band licenses,including 40 MHz available for deployment in December2021, with the remainder available for deployment no laterthan December 2023. In late 2021, the Federal AviationAdministration (FAA) questioned whether the C-bandlaunch could impact radio altimeter equipment onairplanes, which operate on spectrum bands over 400 MHzaway from the spectrum AT&T launched in 2022 and 220MHz away from spectrum AT&T plans to launch in 2023. Inresponse, to allow the FAA more time to evaluate, AT&Tand Verizon delayed their planned December 2021 5G C-band launch by six weeks and voluntarily committed to aseries of temporary, precautionary measures, in additionto deferring turning on a limited number of towers aroundcertain airports. These measures have been subsequentlymodified from time to time. We continue to work with the\\nFAA to reduce the temporary measures with C-banddeployments as aircraft equipment is upgraded.\\nIn recent years, the FCC took several actions to make\\nspectrum available for 5G services, including the auctionof 280 MHz of mid-band spectrum previously used forsatellite service (the “C Band” auction) and 39 GHz bandspectrum. AT&T obtained spectrum in these auctions (see“Other Business Matters”). The FCC also made 150 MHz ofmid-band CBRS spectrum available, to be shared withFederal incumbents, which enjoy priority. In addition, theFCC recently completed Auction 110, in which AT&T won40 MHz of 3.45 GHz spectrum nationwide at a cost of$9,079.\\nCOMPETITION\\nCompetition continues to increase for communications\\nand digital services from traditional and nontraditionalcompetitors. Technological advances have expanded thetypes and uses of services and products available. Inaddition, lack of or a reduced level of regulation ofcomparable legacy services has lowered costs foralternative communications service providers. As a result,we face continuing competition as well as some newopportunities in significant portions of our business.\\nWireless We face substantial competition in our wireless\\nbusinesses. Under current FCC rules, multiple licensees,who provide wireless services on the cellular, PCS,Advanced Wireless Services, 700 MHz and other spectrumbands, may operate in each of our U.S. service areas. Ourcompetitors include two national wireless providers; alarger number of regional providers and resellers of thoseservices; and certain cable companies. In addition, we facecompetition from providers who offer voice, textmessaging and other services as applications on datanetworks. We are one of three facilities-based providers inMexico (retail and wholesale), with the most significantmarket share controlled by América Móvil. We mayexperience significant competition from companies thatprovide similar services using other communicationstechnologies and services. While some of thesetechnologies and services are now operational, others arebeing developed or may be developed. We compete forcustomers based principally on service/device offerings,price, network quality, coverage area and customerservice.\\nBroadband The desire for high-speed data on demand,\\nincluding video, is continuing to lead customers toterminate their traditional wired or linear services and useour fiber services or competitors’ wireless, satellite andinternet-based services. In most U.S. markets, we competefor customers with large cable companies for high-speedinternet and voice services, wireless broadband providers,and other smaller telecommunications companies forboth long-distance and local services.\\n\\t?',\n", " 'Legacy Voice and Data We continue to lose legacy voice\\nand data subscribers due to competitors (e.g., wireless,cable and VoIP providers) who can provide comparableservices at lower prices because they are not subject totraditional telephone industry regulation (or the extent ofregulation they are subject to is in dispute), utilizedifferent technologies or promote a different businessmodel (such as advertising-based).\\nAdditionally, we provide local and interstate telephone\\nand switched services to other service providers, primarilylarge internet service providers using the largest class ofnationwide internet networks (internet backbone),wireless carriers, other telephone companies, cablecompanies and systems integrators. These services aresubject to additional competitive pressures from thedevelopment of new technologies, the introduction ofinnovative offerings and increasing satellite, wireless,fiber-optic and cable transmission capacity for services.\\nACCOUNTING POLICIES AND STANDARDS\\nCritical Accounting Policies and Estimates Because of\\nthe size of the financial statement line items they relate toor the extent of judgment required by our management,some of our accounting policies and estimates have amore significant impact on our consolidated financialstatements than others.\\nPension and Postretirement Benefits Our actuarial\\nestimates of retiree benefit expense and the associatedsignificant weighted-average assumptions are discussedin Note 14. Our assumed weighted-average discount ratesfor both pension and postretirement benefits of 5.20%, atDecember 31, 2022, reflect the hypothetical rate at whichthe projected benefit obligations could be effectivelysettled or paid out to participants. We determined ourdiscount rate based on a range of factors, including a yieldcurve composed of the rates of return on several hundredhigh-quality, fixed income corporate bonds available atthe measurement date and corresponding to the relatedexpected durations of future cash outflows for theobligations. These bonds had an average rating of at leastAa3 or AA- by the nationally recognized statistical ratingorganizations, denominated in U.S. dollars, and generallynot callable, convertible or index linked. For the yearended December 31, 2022, when compared to the yearended December 31, 2021, we increased our pensiondiscount rate by 2.20%, resulting in a decrease in ourpension plan benefit obligation of $11,738, and increasedour postretirement discount rate by 2.40%, resulting in adecrease in our postretirement benefit obligation of$2,102.\\nOur expected long-term rate of return was 6.75% on\\npension plan assets and 4.50% on postretirement planassets for 2022. We have increased our expected return onplan assets to 7.50% on pension plan assets and 6.50% onpostretirement plan assets for 2023, reflecting higherlong-term capital market expectations for equities andhigher yields for bonds. Our expected return on planassets is calculated using the actual fair value of planassets. If all other factors were to remain unchanged, we\\nexpect that a 0.50% decrease in the expected long-termrate of return would cause 2023 combined pension andpostretirement cost to increase $201, which under ouraccounting policy would be adjusted to actual returns inthe current year upon remeasurement of our retireebenefit plans.\\nWe recognize gains and losses on pension and\\npostretirement plan assets and obligations immediately in“Other income (expense) – net” in our consolidatedstatements of income. These gains and losses aregenerally measured annually as of December 31, andaccordingly, will normally be recorded during the fourthquarter, unless an earlier remeasurement is required.Should actual experience differ from actuarialassumptions, the projected pension benefit obligation andnet pension cost and accumulated postretirement benefitobligation and postretirement benefit cost would beaffected in future years. See Note 14 for additionaldiscussions regarding our assumptions.\\nDepreciation Our depreciation of assets, including use of\\ncomposite group depreciation for certain subsidiaries andestimates of useful lives, is described in Notes 1 and 7.\\nIf all other factors were to remain unchanged, we expect\\nthat a one-year increase in the useful lives of our plant inservice would have resulted in a decrease ofapproximately $2,653 in our 2022 depreciation expenseand that a one-year decrease would have resulted in anincrease of approximately $3,778 in our 2022 depreciationexpense. See Notes 7 and 8 for depreciation andamortization expense applicable to property, plant andequipment, including our finance lease right-of-use assets.\\nAsset Valuations and ImpairmentsGoodwill and other indefinite-lived intangible assets are\\nnot amortized but tested at least annually on October 1for impairment. For impairment testing, we estimate fairvalues using models that predominantly rely on theexpected cash flows to be derived from the reporting unitor use of the asset. Long-lived assets are reviewed forimpairment whenever events or circumstances indicatethat the book value may not be recoverable over theremaining life. Inputs underlying the expected cash flowsinclude, but are not limited to, subscriber counts, revenueper user, capital investment and acquisition costs persubscriber, and ongoing operating costs. We based ourassumptions on a combination of our historical results,trends, business plans and marketplace participant data.\\nAnnual Goodwill Testing\\nGoodwill is tested on a reporting unit basis by comparing\\nthe estimated fair value of each reporting unit to its bookvalue. If the fair value exceeds the book value, then noimpairment is measured. We estimate fair values using anincome approach (also known as a discounted cash flowmodel) and a market multiple approach. The incomeapproach utilizes our future cash flow projections with aperpetuity value discounted at an appropriate weightedManagement’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n\\t!',\n", " 'average cost of capital. The market multiple approach\\nuses the multiples of publicly traded companies whoseservices are comparable to those offered by the reportingunits.\\nAs of October 1, 2022, the calculated fair value of the\\nMobility reporting unit exceeded its book value and noadditional testing was necessary. If either the projectedrate of long-term growth of Mobility cash flows orrevenues declined by 0.5%, or if the weighted averagecost of capital increased by 0.5%, the fair value would stillbe higher than the book value of the goodwill. In the eventof a 10% drop in the fair value of the Mobility reportingunit, the fair value still would have exceeded the bookvalue of the reporting unit.\\nOur 2022 annual goodwill impairment analysis resulted in\\nnoncash impairment charges related to our BusinessWireline, Consumer Wireline and Mexico reporting units.The decline in fair values was primarily due to changes inthe macroeconomic environment, namely increasedweighted-average cost of capital. Also, inflation pressureand lower projected cash flows driven by secular declines,predominantly at Business Wireline, impacted the fairvalues. Future sustained declines in macroeconomic orbusiness conditions, or higher discount rates or declines inthe value of AT&T stock could result in goodwillimpairment charges in future periods. A summary ofbusiness unit goodwill impairment by segment andsensitivity analysis is as follows:\\nCommunicationsLatin\\nAmerica\\nBusiness\\nWirelineConsumer\\nWireline Mexico\\nGoodwill as ofOctober 1, 2022: $ 17,903 $ 30,155 $ 826\\nImpairment charge (13,478) (10,508) (826)\\nRemaining Goodwill at\\nDecember 31, 2022 $ 4,425 $ 19,647 $ —\\nSensitivity analysis,\\napproximate hypotheticalimpairment charge:\\nWeighted-average cost of\\ncapital increase of 25 BP $ 1,200 $ 2,200 $ —\\nProjected terminal growth\\nrate decline of 25 BP 700 1,400 —\\nProjected long-term EBITDA\\nmargin decline of 100 BP 1,500 1,300 —\\nU.S. Wireless Licenses\\nThe fair value of U.S. wireless licenses is assessed using a\\ndiscounted cash flow model (the Greenfield Approach)and a qualitative corroborative market approach based onauction prices, depending upon auction activity. TheGreenfield Approach assumes a company initially ownsonly the wireless licenses and makes investments requiredto build an operation comparable to current use. These\\nlicenses are tested annually for impairment on anaggregated basis, consistent with their use on a nationalscope for the United States. For impairment testing, weassume subscriber and revenue growth will trend up toprojected levels, with a long-term growth rate reflectingexpected long-term inflation trends. We assume churnrates will initially exceed our current experience butdecline to rates that are in line with industry-leadingchurn. We used a discount rate of 9.50%, based on theoptimal long-term capital structure of a marketparticipant and its associated cost of debt and equity forthe licenses, to calculate the present value of theprojected cash flows. If either the projected rate of long-term growth of cash flows or revenues declined by 0.5%,or if the discount rate increased by 0.5%, the fair values ofthese wireless licenses would still be higher than the bookvalue of the licenses. The fair value of these wirelesslicenses exceeded their book values by more than 10%.\\nOther Finite-Lived Intangibles\\nCustomer relationships, licenses in Mexico and other\\nfinite-lived intangible assets are reviewed for impairmentwhenever events or circumstances indicate that the bookvalue may not be recoverable over their remaining life. Forthis analysis, we compare the expected undiscountedfuture cash flows attributable to the asset to its bookvalue. When the asset’s book value exceeds undiscountedfuture cash flows, an impairment is recorded to reducethe book value of the asset to its estimated fair value (seeNotes 7 and 9).\\nIncome Taxes Our estimates of income taxes and the\\nsignificant items giving rise to the deferred assets andliabilities are shown in Note 13 and reflect our assessmentof actual future taxes to be paid on items reflected in thefinancial statements, giving consideration to both timingand probability of these estimates. Actual income taxescould vary from these estimates due to future changes inincome tax law or the final review of our tax returns byfederal, state or foreign tax authorities.\\nWe use our judgment to determine whether it is more\\nlikely than not that we will sustain positions that we havetaken on tax returns and, if so, the amount of benefit toinitially recognize within our financial statements. Weregularly review our uncertain tax positions and adjust ourunrecognized tax benefits (UTBs) in light of changes infacts and circumstances, such as changes in tax law,interactions with taxing authorities and developments incase law. These adjustments to our UTBs may affect ourincome tax expense. Settlement of uncertain tax positionsmay require use of our cash.\\nNew Accounting StandardsSee Note 1 for discussion of recently issued or adopted\\naccounting standards.\\n\\t¿',\n", " 'OTHER BUSINESS MATTERS\\nSpectrum Auctions On January 14, 2022, the FCC\\nannounced that we were the winning bidder for 1,624 3.45GHz licenses in Auction 110. We provided the FCC anupfront deposit of $123 in the third quarter of 2021 andpaid the remaining $8,956 in the first quarter of 2022, for atotal of $9,079. We received the licenses in May 2022, andclassified the auction deposits and related capitalizedinterest as “Licenses – Net” on our December 31, 2022consolidated balance sheet.\\nOn February 24, 2021, the FCC announced that AT&T was\\nthe winning bidder for 1,621 C-Band licenses, comprised ofa total of 80 MHz nationwide, including 40 MHz in Phase I.We provided to the FCC an upfront deposit of $550 in 2020and cash payments totaling $22,856 in the first quarter of2021, for a total of $23,406. We received the licenses in July2021 and classified the auction deposits, relatedcapitalized interest and billed relocation costs as “Licenses– Net” on our December 31, 2021 consolidated balancesheet. In December 2021, we paid $955 of IncentivePayments for the clearing of Phase I spectrum andestimate that we will be responsible for an additional$2,112 upon clearing of Phase II spectrum, expected by theend of 2023. Additionally, we are responsible forapproximately $1,100 of compensable relocation costsover the next several years as the spectrum is beingcleared by satellite operators, of which we paid $650 inthe fourth quarter of 2021 and $98 in the third quarter of2022.\\nWarnerMedia On April 8, 2022, we completed the\\nseparation and distribution of our WarnerMedia business,and merger of Magallanes, Inc. (Spinco), an AT&Tsubsidiary formed to hold the WarnerMedia business, witha subsidiary of Discovery, Inc., which was renamed WarnerBros. Discovery, Inc. (WBD). Each AT&T shareholder wasentitled to receive 0.241917 shares of WBD common stockfor each share of AT&T common stock held as of therecord date, which represented approximately 71% ofWBD. In connection with and in accordance with the termsof the Separation and Distribution Agreement (SDA), priorto the distribution and merger, AT&T receivedapproximately $40,400, which includes $38,800 of Spincocash and $1,600 of debt retained by WarnerMedia. Duringthe second quarter of 2022, assets of approximately$121,100 and liabilities of $70,600 were removed from ourbalance sheet as well as $45,041 of retained earnings and$5,632 of additional paid-in capital associated with thetransaction. Additionally, in August 2022, we and WBDfinalized the post-closing adjustment, pursuant to Section1.3 of the SDA, which resulted in a $1,200 payment to WBDin the third quarter of 2022 and was reflected in theDecember 31, 2022 balance sheet as an adjustment toadditional paid-in capital. The payment is accounted for ascash used in financing activities in our statement of cashflows in third quarter of 2022. (See Note 6)\\nAT&T, Spinco and Discovery entered into a Tax Matters\\nAgreement, which governs the parties’ rights,responsibilities and obligations with respect to tax\\nliabilities and benefits, the preservation of the expectedtax-free status of the transactions contemplated by theSDA, and other matters regarding taxes.\\nAdditionally, we entered into an adjusted HBO Max\\nagreement with WBD that provides us with expandeddistribution rights and additional flexibility to market andsell the service in a cost-efficient manner. Under theterms of the agreement, beginning June 1, 2022, we arepermitted to include HBO Max in our customer offeringsin exchange for a licensing fee. Furthermore, AT&T has theright, but not the obligation, to market and distribute HBOMax to its customers in plans, bundles, and promotionaloffers.\\nXandr On June 6, 2022, we completed the sale of the\\nmarketplace component of Xandr to MicrosoftCorporation. Xandr was reflected in our historical financialstatements as discontinued operations. (See Note 6)\\nGigapower, LLC On December 22, 2022, we agreed to\\nform Gigapower, LLC (Gigapower), a joint venture withBlackRock Alternatives, to provide a fiber network toInternet service providers and other businesses across theU.S. that serve customers outside of our traditional 21-state wireline footprint. The transaction is subject tocustomary closing conditions, including regulatoryapprovals. Upon closing the joint venture, we expect todeconsolidate Gigapower’s operations.\\nLabor Contracts As of January 31, 2023, we employed\\napproximately 160,700 persons. Approximately 42% of ouremployees are represented by the CommunicationsWorkers of America (CWA), the International Brotherhoodof Electrical Workers (IBEW) or other unions. Afterexpiration of the collective bargaining agreements, workstoppages or labor disruptions may occur in the absenceof new contracts or other agreements being reached. Themain contracts included the following:\\n• A contract covering approximately 7,000 Mobility\\nemployees in nine states, for which we reachedtentative agreement in February 2023.\\n• A contract covering approximately 400 employees\\nsupporting internet-based products is set to expire inJuly 2023.\\n• A contract covering approximately 200 Mobility\\nemployees in Illinois is set to expire in May 2023.\\nInflation Reduction Act The Inflation Reduction Act of\\n2022 (Inflation Reduction Act) was enacted on August 16,2022. The Inflation Reduction Act imposes a new 15%corporate alternative minimum tax (CAMT) on “applicablecorporations” for taxable years beginning after December31, 2022. The CAMT is imposed to the extent thealternative minimum tax exceeds a company’s regular taxliability. A corporation that pays alternative minimum taxis eligible for a credit against income tax in future years.Subject to future regulatory guidance, we currently do notbelieve the CAMT will have a material impact on our 2023tax liability.Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n \\x08',\n", " 'OECD On October 8, 2021, the Organization for Economic\\nCo-operation and Development (OECD) announced theOECD/G20 Inclusive Framework on Base Erosion andProfit Shifting which agreed to a two-pillar solution toaddress tax challenges arising from digitalization of theeconomy. On December 20, 2021, the OECD released PillarTwo Model Rules defining the global minimum tax, whichcalls for the taxation of large corporations at a minimumrate of 15%. The OECD continues to release additionalguidance on the two-pillar framework with widespreadimplementation anticipated by 2024. There can be noassurance that these new rules will not increase our taxesin these countries and have an adverse impact on ourprovision for income taxes, when enacted or enforced byparticipating countries in which we do business.\\nEnvironmental We are subject from time to time to\\njudicial and administrative proceedings brought by variousgovernmental authorities under federal, state or localenvironmental laws. We reference in our Forms 10-Q and10-K certain environmental proceedings that could resultin monetary sanctions (exclusive of interest and costs) ofthree hundred thousand dollars or more. However, we donot believe that any of those currently pending will have amaterial adverse effect on our results of operations.\\nLIQUIDITY AND CAPITAL RESOURCES\\nContinuing operations for the\\nyears ended December 31, 2022 2021 2020\\nCash provided by operating\\nactivities $ 35,812 $ 37,170 $ 37,484\\nCash used in investing\\nactivities (26,899) (32,489) (13,447)\\nCash (used in) provided by\\nfinancing activities (59,564) 1,894 (31,031)\\nAt December 31, 2022 2021\\nCash and cash equivalents $ 3,701 $ 19,223\\nTotal debt 135,890 175,631\\nWe had $3,701 in cash and cash equivalents available at\\nDecember 31, 2022, decreasing $15,522 since December 31,2021 and returning to historical levels with the close of theWarnerMedia/Discovery transaction. Cash and cashequivalents included cash of $866 and money marketfunds and other cash equivalents of $2,835. Approximately$1,045 of our cash and cash equivalents were held by ourforeign entities in accounts predominantly outside of theU.S. and may be subject to restrictions on repatriation.\\nIn 2022, cash inflows were primarily provided by cash\\nreceipts from operations, including cash from our sale andtransfer of our receivables to third parties, cash receivedin connection with the separation and distribution of theWarnerMedia business, issuance of commercial paper andlong-term debt and distributions from DIRECTV. Theseinflows were exceeded by cash used to meet the needs ofthe business, including, but not limited to, payment ofoperating expenses, spectrum acquisitions, funding capital\\nexpenditures and vendor financing payments, repaymentof short-term borrowings and long-term debt, anddividend payments to stockholders. We maintainavailability under our credit facilities and our commercialpaper program to meet our short-term liquidityrequirements.\\nRefer to “Contractual Obligations” discussion below for\\nadditional information regarding our cash requirements.\\nCash Provided by Operating Activities from Continuing\\nOperations\\nDuring 2022, cash provided by operating activities was\\n$35,812 compared to $37,170 in 2021, reflecting theseparation of DIRECTV and working capital impacts,including higher payments for wireless devices tied toaccelerated subscriber growth.\\nWe actively manage the timing of our supplier payments\\nfor operating items to optimize the use of our cash.Among other things, we seek to make payments on 90-day or greater terms, while providing the suppliers withaccess to bank facilities that permit earlier payments attheir cost. In addition, for payments to a key supplier, aspart of our working capital initiatives, we havearrangements that allow us to extend the stated paymentterms by up to 90 days at an additional cost to us(referred to as supplier financing). The net impact ofsupplier financing was to improve cash from operatingactivities $851 in 2022 and $25 in 2021. All supplierfinancing payments are due within one year.\\nCash Used in or Provided by Investing Activities from\\nContinuing Operations\\nDuring 2022, cash used in investing activities totaled\\n$26,899, consisting primarily of $19,626 (including interestduring construction) for capital expenditures, and $10,200for acquisitions of licenses won in Auction 110 andassociated capitalized interest. In 2022, we received areturn of investment of $2,649 from DIRECTVrepresenting distributions in excess of cumulative equityin earnings from DIRECTV (see Note 10).\\nFor capital improvements, we have negotiated favorable\\nvendor payment terms of 120 days or more (referred to asvendor financing) with some of our vendors, which areexcluded from capital expenditures and reported asfinancing activities. Vendor financing payments were$4,697 in 2022, compared to $4,596 in 2021. Capitalexpenditures in 2022 were $19,626, and when including$4,697 cash paid for vendor financing, capital investmentwas $24,323 ($4,182 higher than the prior year).\\nThe vast majority of our capital expenditures are spent on\\nour networks, including product development and relatedsupport systems. In 2022, we placed $5,817 of equipmentin service under vendor financing arrangements(compared to $5,282 in 2021) and approximately $320 ofassets related to the FirstNet build (compared to $750 in2021). Total reimbursements from the government forFirstNet were approximately $260 for 2022 and $865 for2021.\\n \\t',\n", " 'The amount of our capital expenditures is influenced by\\ndemand for services and products, capacity needs andnetwork enhancements. Our capital expenditures andvendor financing payments were elevated in 2022,reflecting strategic investments. In 2023, we expect thatour capital investment, which includes capitalexpenditures and cash paid for vendor financing, will beconsistent with 2022 levels.Cash Used in or Provided by Financing Activities from\\nContinuing Operations\\nIn 2022, cash used in financing activities totaled $59,564\\nand was comprised of debt issuances and repayments,payments of dividends, and vendor financing payments.We\\nalso paid approximately $1,211 in cash on the note\\npayable to DIRECTV, with $130 due as of December 31,\\n2022 (see Note 19).\\nA tabular summary of our debt activity during 2022 is as follows:\\nFirst\\nQuarterSecond\\nQuarterThird\\nQuarterFourth\\nQuarterFull Year\\n2022\\nNet commercial paper borrowings $ 1,471 $ (5,219) $ (724) $ (1,337) $ (5,809)\\nIssuance of Notes and Debentures:\\nPrivate Financing $ — $ — $ 750 $ — $ 7502025 Term Loan — — — 2,500 2,500Other 479 — — — 479\\nDebt Issuances $ 479 $ — $ 750 $ 2,500 $ 3,729Repayments:\\n2021 Syndicated Term Loan $ — $ (7,350) $ — $ — $ (7,350)BAML Bilateral Term Loan - Tranche A — (1,000) — — (1,000)Private financing — (750) — (750) (1,500)\\nRepayments of other short-term borrowings $ — $ (9,100) $ — $ (750) $ (9,850)\\nUSD notes\\n1, 2, 3$ (123) $ (18,957) $ — $ (287) $ (19,367)\\nEuro notes — (3,343) — — (3,343)BAML Bilateral Term Loan - Tranche B — (1,000) — — (1,000)Other (667) (123) (199) (419) (1,408)\\nRepayments of long-term debt $ (790) $(23,423) $ (199) $ (706) $ (25,118)\\n1On April 11, 2022, we issued notices for the redemption in full of all of the outstanding approximately $9,042 aggregate principal amount of various gl obal notes due 2022\\nto 2026 with coupon rates ranging from 2.625% to 4.450% (Make-Whole Notes). The Make-Whole Notes were redeemed on the redemption dates set forth in the notices\\nof redemption, at “make whole” redemption prices calculated as set forth in the respective redemption notices in the second quarter.\\n2Includes $7,954 of cash paid toward the $8,822 aggregate principal amount of various notes that were tendered for cash in May 2022. The notes had intere st rates\\nranging between 3.100% and 8.750% and original maturities ranging from 2026 to 2061.\\n3Includes $287 of principal repayment on a $592 zero coupon note that matured in November 2022. The other $305 was applied to operating cash flows relate d to interest\\nexpense that accreted to the note over its life.\\nThe weighted average interest rate of our long-term debtportfolio, including credit agreement borrowings and theimpact of derivatives, was approximately 4.1% as ofDecember 31, 2022 and 3.8% as of December 31, 2021. Wehad $133,207 of total notes and debentures outstanding atDecember 31, 2022, which included Euro, British poundsterling, Canadian dollar, Mexican peso, Australian dollar,and Swiss franc denominated debt that totaledapproximately $35,525.\\nAt December 31, 2022, we had $7,467 of debt maturing\\nwithin one year, consisting of $866 of commercial paperborrowings and $6,601 of long-term debt issuances.\\nDuring 2022, we paid $4,697 of cash under our vendor\\nfinancing program, compared to $4,596 in 2021. Totalvendor financing payables included in our December 31,2022 consolidated balance sheet were $6,147, with $4,592due within one year (in “Accounts payable and accruedliabilities”) and the remainder predominantly due withinfive years (in “Other noncurrent liabilities”).At December 31, 2022, we had approximately 144 million\\nshares remaining from our share repurchaseauthorizations approved by the Board of Directors in 2014.During 2022, we repurchased approximately 34 millionshares under the March 2014 authorization.\\nWe paid dividends on common shares and preferred\\nshares of $9,859 in 2022, compared with $15,068 in 2021.Dividends on common stock declared by our Board ofDirectors, on a quarterly basis, totaled $1.11 per share in2022 and $2.08 per share in 2021. Our dividend policyconsiders the expectations and requirements ofstockholders, capital funding requirements of AT&T andlong-term growth opportunities. On February 1, 2022, weannounced that our Board of Directors approved anexpected annual dividend level of $1.11 per common share,or approximately $8,000 per year, following the close ofthe WarnerMedia/Discovery transaction.\\nIn the fourth quarter of 2022, all outstanding AT&T\\nMobility II LLC (Mobility preferred interests) were put to us(approximately $8,000), with approximately one-thirdManagement’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n ',\n", " 'redeemed in the fourth quarter; approximately 107 million\\ninterests are expected to be redeemed primarily inOctober 2023 and 107 million redeemed in October 2024,per the terms of the agreement, unless the interests arecalled or the puts are accepted by AT&T prior to thosedates. With the certainty of redemption, the remainingMobility preferred interests were reclassified from equityto a liability at fair value, with approximately $2,670recorded in current as “Accounts payable and accruedliabilities” and $2,670 recorded in “Other noncurrentliabilities.” In the fourth quarter of 2022, we paidapproximately $2,600 cash to redeem the Mobilitypreferred interests put to us on October 24, 2022. (SeeNote 16)\\nOur 2023 financing activities will focus on managing our\\ndebt level and paying dividends, subject to approval by ourBoard of Directors. We plan to fund our financing uses ofcash through a combination of cash from operations,issuance of debt, and asset sales. The timing and mix ofany debt issuance and/or refinancing will be guided bycredit market conditions and interest rate trends.\\nCredit Facilities\\nThe following summary of our various credit and loan\\nagreements does not purport to be complete and isqualified in its entirety by reference to each agreementfiled as exhibits to our Annual Report on Form 10-K.\\nWe use credit facilities as a tool in managing our liquidity\\nstatus. In November 2022, we terminated one of ourrevolving credit agreements and amended and restatedthe other. We currently have one $12,000 revolving creditagreement that terminates on November 18, 2027(Revolving Credit Agreement). No amounts wereoutstanding as of December 31, 2022.\\nOn January 29, 2021, we entered into a $14,700 Term Loan\\nCredit Agreement (2021 Syndicated Term Loan), with Bankof America, N.A., as agent. On March 23, 2021, we borrowed$7,350 under the 2021 Syndicated Term Loan and theremaining $7,350 of lenders’ commitments wereterminated. In the first quarter of 2022, the maturity dateof the 2021 Syndicated Term Loan was extended toDecember 31, 2022. On April 13, 2022, the 2021 SyndicatedTerm Loan was paid off and terminated.\\nIn March 2021, we entered into and drew on a $2,000 term\\nloan credit agreement (BAML Bilateral Term Loan)consisting of (i) a $1,000 facility originally due December31, 2021 (BAML Tranche A Facility) and subsequentlyextended to December 31, 2022 in the fourth quarter of2021, and (ii) a $1,000 facility due December 31, 2022 (BAMLTranche B Facility), with Bank of America, N.A., as agent.On April 13, 2022, the BAML Bilateral Term Loan was paidoff and terminated.\\nIn November 2022, we entered into and drew on a $2,500\\nterm loan agreement due February 16, 2025 (2025 TermLoan), with Mizuho Bank, Ltd., as agent. As of December 31,2022, $2,500 was outstanding under this agreement.We also utilize other external financing sources, which\\ninclude various credit arrangements supported bygovernment agencies to support network equipmentpurchases as well as a commercial paper program.\\nEach of our credit and loan agreements contains\\ncovenants that are customary for an issuer with aninvestment grade senior debt credit rating. Our RevolvingCredit Agreement and 2025 Term Loan include a net debt-to-EBITDA financial ratio covenant requiring AT&T tomaintain, as of the last day of each fiscal quarter, a ratio ofnot more than 3.75-to-1. Other loan agreements include anet debt-to-EBITDA financial ratio covenant requiringAT&T to maintain, as of the last day of each fiscal quarterthrough June 30, 2023 a ratio of not more than 4.0-to-1,and a ratio of not more than 3.5-to-1 for any fiscal quarterthereafter. As of December 31, 2022, we were incompliance with the covenants for our credit facilities.\\nCollateral Arrangements\\nMost of our counterparty collateral arrangements require\\ncash collateral posting by AT&T only when derivativemarket values exceed certain thresholds. Under thesearrangements, which cover the majority of ourapproximately $38,800 derivative portfolio,counterparties are still required to post collateral. During2022, we posted approximately $760 of cash collateral, ona net basis. Cash postings under these arrangements varywith changes in credit ratings and netting agreements.(See Note 12)\\nOther\\nOur total capital consists of debt (long-term debt and\\ndebt maturing within one year) and stockholders’ equity.Our capital structure does not include debt issued by ourequity method investments. At December 31, 2022, ourdebt ratio was 56.1%, compared to 48.9% at December 31,2021 and 46.4% at December 31, 2020. The debt ratio isaffected by the same factors that affect total capital, andreflects our recent debt issuances, repayments andreclassifications related to redemption of noncontrollinginterests.\\n .',\n", " 'A significant amount of our cash outflows for continuing\\noperations is related to tax items, acquisition of spectrumthrough FCC auctions and benefits paid for current andformer employees:\\n• Total taxes incurred, collected and remitted by AT&T\\nduring 2022 and 2021, were $16,630 and $17,119. Thesetaxes include income, franchise, property, sales,excise, payroll, gross receipts and various other taxesand fees.\\n• Total domestic spectrum acquired primarily through\\nFCC auctions, including cash, exchanged spectrumand auction deposits was approximately $10,200 in2022, $25,400 in 2021 and $2,800 in 2020.• Total health and welfare benefits provided to certain\\nactive and retired employees and their dependentstotaled approximately $3,200 in 2022 and $3,390 in2021, with $788 paid from plan assets in 2022compared to $1,163 in 2021. Of those benefits,approximately $2,840 related to medical andprescription drug benefits in 2022 compared to $2,990in 2021. In addition, in 2022, we prefunded $500 forfuture benefit payments versus $685 in 2021. We paid$5,854 of pension benefits out of plan assets in 2022compared to $5,942 in 2021.\\nContractual Obligations\\nOur contractual obligations as of December 31, 2022, and the estimated timing of payment, are in the following table:\\nPayments Due By Period\\nTotalLess than\\n1 Year1-3\\nYears3-5\\nYearsMore than 5\\nYears\\nLong-term debt obligations1$ 147,673 $ 6,929 $ 14,898 $ 14,897 $ 110,949\\nInterest payments on long-term debt2101,559 6,062 10,910 9,818 74,769\\nPurchase obligations327,015 12,313 11,424 2,457 821\\nOperating lease obligations426,468 4,657 7,746 5,132 8,933\\nFirstNet sustainability payments517,205 195 390 3,255 13,365\\nUnrecognized tax benefits68,323 486 — — 7,837\\nOther finance obligations713,788 5,391 2,830 1,787 3,780\\nMobility preferred interests85,340 2,670 2,670 — —\\nTotal Contractual Obligations $ 347,371 $ 38,703 $ 50,868 $ 37,346 $ 220,454\\n1Represents principal or payoff amounts of notes, debentures and credit agreement borrowings at maturity (see Note 11). Foreign debt includes the imp act from hedges,\\nwhen applicable.\\n2Includes credit agreement borrowings.\\n3We expect to fund the purchase obligations with cash provided by operations or through incremental borrowings. Consists of commitments primarily re lated to\\nspectrum acquisitions and other commercial commitments. The minimum commitment for certain obligations is based on termination penalties that cou ld be paid to\\nexit the contracts. (See Note 21)\\n4Represents operating lease payments (see Note 8).\\n5Represents contractual commitment to make sustainability payments over the 25-year contract. These sustainability payments represent our commit ment to fund\\nFirstNet’s operating expenses and future reinvestment in the network, which we own and operate. FirstNet has a statutory requirement to reinvest fun ds that exceed\\nthe agency’s operating expenses, which we anticipate to be $15,000. (See Note 20)\\n6The noncurrent portion of the UTBs is included in the “More than 5 Years” column, as we cannot reasonably estimate the timing or amounts of additional ca sh payments,\\nif any, at this time (see Note 13).\\n7Represents future minimum payments under the Crown Castle and other arrangements (see Note 18), payables subject to extended payment terms (see Note 22),\\nfinance lease payments (see Note 8) and note payable to DIRECTV (see Note 19).\\n8See Note 16.\\nCertain items were excluded from this table because the year of payment is unknown and could not be reliably\\nestimated, we believe the obligations are immaterial, or the settlement of the obligation will not require the use of cash.These items include: deferred income tax liability of $57,032 (see Note 13); net postemployment benefit obligations of$8,433 (including current portion); and other noncurrent liabilities of $11,035.Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n :',\n", " 'MARKET RISK\\nWe are exposed to market risks primarily from changes in\\ninterest rates and foreign currency exchange rates. Theserisks, along with other business risks, impact our cost ofcapital. It is our policy to manage our debt structure andforeign exchange exposure in order to manage capitalcosts, control financial risks and maintain financialflexibility over the long term. In managing market risks, weemploy derivatives according to documented policies andprocedures, including interest rate swaps, interest ratelocks, foreign currency exchange contracts and combinedinterest rate foreign currency contracts (cross-currencyswaps). We do not use derivatives for trading orspeculative purposes. We do not foresee significantchanges in the strategies we use to manage market risk inthe near future.\\nOne of the most significant assumptions used in\\nestimating our postretirement benefit obligations is theassumed weighted-average discount rate, which is thehypothetical rate at which the projected benefitobligations could be effectively settled or paid out toparticipants. We determined our discount rate based on arange of factors, including a yield curve composed of therates of return on several hundred high-quality, fixedincome corporate bonds available at the measurementdate and corresponding to the related expected durationsof future cash outflows for the obligations. In recentyears, the discount rates have been increasingly volatile,and on average have been lower than in historical periods.Lower discount rates used to measure our pension andpostretirement plans result in higher obligations. Futureincreases in these rates could result in lower obligations,improved funded status and actuarial gains.\\nInterest Rate Risk\\nThe majority of our financial instruments are medium-\\nand long-term fixed-rate notes and debentures. Changesin interest rates can lead to significant fluctuations in thefair value of these instruments. The principal amounts byexpected maturity, average interest rate and fair value ofour liabilities that are exposed to interest rate risk aredescribed in Notes 11 and 12. In managing interestexpense, we control our mix of fixed and floating ratedebt through term loans, floating rate notes, and interestrate swaps. We have established interest rate risk limitsthat we closely monitor by measuring interest ratesensitivities in our debt and interest rate derivativesportfolios.Most of our foreign-denominated long-term debt has\\nbeen swapped from fixed-rate or floating-rate foreigncurrencies to fixed-rate U.S. dollars at issuance throughcross-currency swaps, removing interest rate risk andforeign currency exchange risk associated with theunderlying interest and principal payments. Likewise,periodically we enter into interest rate locks to partiallyhedge the risk of increases in the benchmark interest rateduring the period leading up to the probable issuance offixed-rate debt. We expect gains or losses in our cross-currency swaps and interest rate locks to offset the lossesand gains in the financial instruments they hedge.\\nWe had no interest rate swaps and no interest rate locks\\nat December 31, 2022.\\nForeign Exchange Risk\\nWe principally use foreign exchange contracts to hedge\\ncosts and debt denominated in foreign currencies. We arealso exposed to foreign currency exchange risk throughour foreign affiliates and equity investments in foreigncompanies.\\nThrough cross-currency swaps, most of our foreign-\\ndenominated debt has been swapped from fixed-rate orfloating-rate foreign currencies to fixed-rate U.S. dollarsat issuance, removing interest rate and foreign currencyexchange risk associated with the underlying interest andprincipal payments. We expect gains or losses in ourcross-currency swaps to offset the gains and losses in thefinancial instruments they hedge. We had cross-currencyswaps with a notional value of $38,213 and a fair value of$(5,982) outstanding at December 31, 2022.\\nFor the purpose of assessing specific risks, we use a\\nsensitivity analysis to determine the effects that marketrisk exposures may have on the fair value of our financialinstruments and results of operations. We had foreignexchange forward contracts with a notional value of $617and a fair value of $(23) outstanding at December 31, 2022.\\n ,',\n", " 'STOCK PERFORMANCE GRAPH\\nComparison of Five Year Cumulative Return\\nAT&T Inc., S&P 500 Index and S&P 500 Communication Services Index\\nThe comparison above assumes $100 invested on December 31, 2017, in AT&T common stock and the following Standard\\n& Poor’s (S&P) Indices: S&P 500 Index and S&P 500 Communication Services Index. Total return equals stock priceappreciation plus reinvestment of dividends.Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n ;100\\n78113\\n8210096126191\\n157\\n100\\n87116143174\\n105AT&T Inc. S&P 500 Index S&P 500 Communication Services Index\\n12/17 12/18 12/19 12/20 12/21 12/226080100120140160180200\\n8987914',\n", " 'RISK FACTORS\\nIn addition to the other information set forth in this\\ndocument, including the matters contained under thecaption “Cautionary Language Concerning Forward-Looking Statements,” you should carefully read thematters described below. We believe that each of thesematters could materially affect our business. Werecognize that most of these factors are beyond ourability to control and therefore we cannot predict anoutcome.\\nMacro-economic Factors:Adverse changes in the U.S. securities markets,\\ninterest rates, rising inflation and medical costs couldmaterially increase our benefit plan costs and futurefunding requirements.\\nOur costs to provide current benefits and funding for\\nfuture benefits are subject to increases, primarily due tocontinuing increases in medical and prescription drugcosts, in part due to inflation, and can be affected by lowerreturns on assets held by our pension and other benefitplans, which are reflected in our financial statements forthat year. In calculating the recognized benefit costs, wehave made certain assumptions regarding futureinvestment returns, interest rates and medical costs.These assumptions could change significantly over timeand could be materially different than originally projected.Lower than assumed investment returns, an increase inour benefit obligations, and higher than assumed medicaland prescription drug costs will increase expenses.\\nThe Financial Accounting Standards Board (FASB) requires\\ncompanies to recognize the funded status of definedbenefit pension and postretirement plans as an asset orliability in their statement of financial position and torecognize changes in that funded status in the year inwhich the changes occur. We have elected to reflect theannual adjustments to the funded status in ourconsolidated statement of income. Therefore, an increasein our costs or adverse market conditions will have anegative effect on our operating results.\\nSignificant adverse changes in capital markets could\\nresult in the deterioration of our defined benefit plans’funded status.\\nInflationary pressures on costs, such as inputs for\\ndevices we sell and network components, labor anddistribution costs may impact our networkconstruction, our financial condition or results ofoperations.\\nAs a provider of telecommunications and technology\\nservices, we sell handsets, wireless data cards, wirelesscomputing devices and customer premises equipmentmanufactured by various suppliers for use with our voiceand data services and depend on suppliers to provide us,directly or through other suppliers, with items such asnetwork equipment, customer premises equipment, andwireless-related equipment such as mobile hotspots,handsets, wirelessly enabled computers, wireless datacards and other connected devices for our customers.Beginning in 2021 and continuing through the early part of\\n2023, the costs of these inputs and the costs of labornecessary to develop, deploy and maintain our networksand our products and services rapidly increased. Inaddition, many of these inputs are subject to pricefluctuations from a number of factors, including, but notlimited to, market conditions, demand for raw materialsused in the production of these devices and networkcomponents, weather, climate change, energy costs,currency fluctuations, supplier capacities, governmentalactions, import and export requirements (includingtariffs), and other factors beyond our control. Inflationaryand supply pressures may continue into the future andcould have an adverse impact on our ability to sourcematerials.\\nOur attempts to offset these cost pressures, such as\\nthrough increases in the selling prices of some of ourproducts and services, may not be successful. Higherproduct prices may result in reductions in sales volume.Consumers may be less willing to pay a price differentialfor our products and may increasingly purchase lower-priced offerings, or may forego some purchasesaltogether, during a period of inflationary pressure or aneconomic downturn. To the extent that price increasesare not sufficient to offset these increased costsadequately or in a timely manner, and/or if they result insignificant decreases in sales volume, our business,financial condition or operating results may be adverselyaffected. Furthermore, we may not be able to offset anycost increases through productivity and cost-savinginitiatives.\\nAdverse changes in global financial markets could limit\\nour ability and our larger customers’ ability to accesscapital or increase the cost of capital needed to fundbusiness operations.\\nDuring 2022, uncertainty surrounding global growth rates,\\ninflation, an increasing interest rate environment and theimpact of the COVID-19 pandemic continued to producevolatility in the credit, currency and equity markets.Volatility may affect companies’ access to the creditmarkets, leading to higher borrowing costs, or, in somecases, the inability to fund ongoing operations. In addition,we contract with large financial institutions to support ourown treasury operations, including contracts to hedge ourexposure on interest rates and foreign exchange and thefunding of credit lines and other short-term debtobligations, including commercial paper. These financialinstitutions face stricter capital-related and otherregulations in the United States and Europe, as well asongoing legal and financial issues concerning their loanportfolios, which may hamper their ability to providecredit or raise the cost of providing such credit.\\nThe U.K. Financial Conduct Authority, which regulates the\\nLondon Interbank Offering Rate (LIBOR), has announcedthat it intends to phase out LIBOR in 2023. Although oursecurities and other debt obligations may provide foralternative methods of calculating the interest rate\\n ?',\n", " 'payable on such indebtedness, uncertainty as to the\\nextent and manner of future changes may adverselyaffect the current trading market for LIBOR-basedsecurities and the value of variable rate indebtedness ingeneral. A company’s cost of borrowing is also affected byevaluations given by various credit rating agencies andthese agencies have been applying tighter creditstandards when evaluating debt levels and future growthprospects. While we have been successful in continuing toaccess the credit and fixed income markets when needed,adverse changes in the financial markets could render useither unable to access these markets or able to accessthese markets only at higher interest costs and withrestrictive financial or other conditions, severely affectingour business operations. Additionally, downgrades of ourcredit rating by the major credit rating agencies couldincrease our cost of borrowing and also impact thecollateral we would be required to post under certainagreements we have entered into with our derivativecounterparties, which could negatively impact ourliquidity. Further, valuation changes in our derivativeportfolio due to interest rates and foreign exchange ratescould require us to post collateral and thus may negativelyimpact our liquidity.\\nOur international operations increase our exposure to\\npolitical instability, to changes in the internationaleconomy and to regulation on our business and theserisks could offset our expected growth opportunities.\\nWe have international operations, particularly in Mexico,\\nand other countries worldwide where we need to complywith a wide variety of complex local laws, regulations andtreaties. In addition, we are exposed to, among otherfactors, fluctuations in currency values, changes inrelationships between U.S. and foreign governments, waror other hostilities, and other regulations that maymaterially affect our earnings. Involvement with foreignfirms also exposes us to the risk of being unable to controlthe actions of those firms and therefore exposes us torisks associated with our obligation to comply with theForeign Corrupt Practices Act (FCPA). Violations of theFCPA could have a material adverse effect on ouroperating results.\\nIndustry-wide Factors:\\nOur business is subject to risks related to the COVID-19\\nvirus.\\nThe COVID-19 pandemic and resulting mitigation\\nmeasures have caused, and may continue to cause, anegative effect on our operating results. These effectsinclude, but are not limited to closure of retail stores;impact on our customers’ ability to pay for our productsand services; reduction in international roaming revenue;and reduced staffing levels in call centers and fieldoperations. We may also incur significantly higherexpenses attributable to infrastructure investmentsrequired to meet higher network utilization from morecustomers consuming bandwidth from changes in workfrom home trends; extended cancellation periods; andincreased labor costs if the COVID-19 pandemic continues\\nfor an extended period.\\nThe COVID-19 pandemic and mitigation measures have\\ncaused, and may continue to cause, adverse impacts onglobal supply chains and economic conditions. Theseimpacts could affect our network development,deployment and maintenance, and the demand for ourproducts and services. The extent to which the COVID-19pandemic impacts our business, results of operations,cash flows and financial condition will depend on futuredevelopments that are highly uncertain and cannot bepredicted, including new information that may emergeconcerning other strains of the virus and the actions tocontain its impact.\\nChanges to federal, state and foreign government\\nregulations and decisions in regulatory proceedings, aswell as private litigation, could further increase ouroperating costs and/or alter customer perceptions ofour operations, which could materially adverselyaffect us.\\nOur subsidiaries providing wired services are subject to\\nsignificant federal and state regulation while many of ourcompetitors are not. In addition, our subsidiaries andaffiliates operating outside the United States are alsosubject to the jurisdiction of national and supranationalregulatory authorities in the market where service isprovided. Our wireless subsidiaries are regulated tovarying degrees by the FCC and in some instances, bystate and local agencies. Adverse regulations and rulingsby the FCC relating to broadband and wirelessdeployment could impede our ability to manage ournetworks and recover costs and lessen incentives toinvest in our networks. The continuing growth of IP-basedservices, especially when accessed by wireless devices, hascreated or potentially could create conflicting regulationbetween the FCC and various state and local authorities,which may involve lengthy litigation to resolve and mayresult in outcomes unfavorable to us. In addition, inresponse to the FAA questioning whether our 5G C-bandlaunch could impact radio altimeter equipment onairplanes, we voluntarily committed to a series oftemporary, precautionary measures, in addition todeferring turning on a limited number of towers aroundcertain airports to allow the FAA more time to evaluate.These measures have been subsequently modified fromtime to time. The FAA’s continued evaluation may impactour planned 5G C-band launch in certain areas. In addition,increased public focus on a variety of issues related to ouroperations, such as privacy issues, government requestsor orders for customer data, and concerns about globalclimate changes, have led to proposals or new legislationat state, federal and foreign government levels to changeor increase regulation on our operations. Enactment ofnew privacy laws and regulations could, among otherthings, adversely affect our ability to collect and offertargeted advertisements or result in additional costs ofManagement’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n !',\n", " 'compliance or litigation. Should customers decide that\\nour competitors offer a more customer-friendlyenvironment, our competitive position, results ofoperations or financial condition could be materiallyadversely affected.\\nEffects of climate change may impose risk of damage\\nto our infrastructure, our ability to provide services,and may cause changes in federal, state and foreigngovernment regulation, all of which may result inpotential adverse impact to our financial results.\\nExtreme weather events precipitated by long-term\\nclimate change have the potential to directly damagenetwork facilities or disrupt our ability to build andmaintain portions of our network and could potentiallydisrupt suppliers’ ability to provide products and servicesrequired to provide reliable network coverage. Any suchdisruption could delay network deployment plans,interrupt service for our customers, increase our costsand have a negative effect on our operating results. Thepotential physical effects of climate change, such asincreased frequency and severity of storms, floods, fires,freezing conditions, sea-level rise and other climate-related events, could adversely affect our operations,infrastructure and financial results. Operational impactsresulting from the potential physical effects of climatechange, such as damage to our network infrastructure,could result in increased costs and loss of revenue. Wecould incur significant costs to improve the climateresiliency of our infrastructure and otherwise prepare for,respond to, and mitigate such physical effects of climatechange. We are not able to accurately predict themateriality of any potential losses or costs associatedwith the physical effects of climate change.\\nFurther, customers, consumers, investors and other\\nstakeholders are increasingly focusing on environmentalissues, including climate change, water use, deforestation,plastic waste and other sustainability concerns. Concernover climate change or other environmental, social andgovernance (ESG) matters may result in new or increasedlegal and regulatory requirements to reduce or mitigateimpacts to the environment and reduce the impact of ourbusiness on climate change. Further, climate changeregulations may require us to alter our proposed businessplans or increase our operating costs due to increasedregulation or environmental considerations, and couldadversely affect our business and reputation.\\nContinuing growth in and the converging nature of\\nwireless and broadband services will require us todeploy significant amounts of capital and requireongoing access to spectrum in order to provideattractive services to customers.\\nWireless and broadband services are undergoing rapid and\\nsignificant technological changes and a dramatic increasein usage, including, in particular, the demand for faster andseamless usage of data, including video, across mobile andfixed devices. The COVID-19 pandemic has acceleratedthese changes and also resulted in higher networkutilization, as more customers consume bandwidth fromchanges in work and learn from home trends. We must\\ncontinually invest in our networks in order to improve ourwireless and broadband services to meet this increasingdemand and changes in customer expectations whileremaining competitive. Improvements in these servicesdepend on many factors, including continued access toand deployment of adequate spectrum and the capitalneeded to expand our wireline network to supporttransport of these services. In order to stem broadbandsubscriber losses to cable competitors in our non-fiberwireline areas, we have been expanding our all-fiberwireline network. We must maintain and expand ournetwork capacity and coverage for transport of data,including video, and voice between cell and fixed landlinesites. To this end, we participate in spectrum auctions andcontinue to deploy software and other technologyadvancements in order to efficiently invest in ournetwork.\\nWe have spent, and plan to continue spending, significant\\ncapital and other resources on the ongoing developmentand deployment of our 5G and fiber wireline networks.This deployment and other network serviceenhancements and product launches may not occur asscheduled or at the cost expected due to many factors,including unexpected inflation, delays in determiningequipment and wireless handset operating standards,supplier delays, software issues, increases in network andhandset component costs, regulatory permitting delaysfor tower sites or enhancements, or labor-related delays.Deployment of new technology also may adversely affectthe performance of the network for existing services. Ifwe cannot acquire needed spectrum, our 5G and fiberofferings fail to gain acceptance in the marketplace or weotherwise fail to deploy the services customers desire ona timely basis with acceptable quality and at reasonablecosts, then our ability to attract and retain customers,and, therefore, maintain and improve our operatingmargins, could be materially adversely affected.\\nIncreasing competition for wireless customers could\\nmaterially adversely affect our operating results.\\nWe have multiple wireless competitors in each of our\\nservice areas and compete for customers basedprincipally on service/device offerings, price, networkquality, coverage area and customer service. In addition,we are facing growing competition from providersoffering services using advanced wireless technologiesand IP-based networks. We expect market saturation tocontinue to cause the wireless industry’s customergrowth rate to moderate in comparison with historicalgrowth rates, leading to increased competition forcustomers. Our share of industry sales could be reduceddue to aggressive pricing or promotional strategiespursued by competitors. We also expect that ourcustomers’ growing demand for high-speed video anddata services will place constraints on our networkcapacity. These competition and capacity constraints willcontinue to put pressure on pricing and margins ascompanies compete for potential customers. Our abilityto respond will depend, among other things, on continued\\n ¿',\n", " 'improvement in network quality and customer service and\\nour ability to price our products and servicescompetitively as well as effective marketing of attractiveproducts and services. These efforts will involvesignificant expenses and require strategic managementdecisions on, and timely implementation of, equipmentchoices, network deployment and service offerings.\\nIntellectual property rights may be inadequate to take\\nadvantage of business opportunities, which maymaterially adversely affect our operations.\\nEffective intellectual property protection may not be\\navailable in every country where we operate. We mayneed to spend significant amounts of money to protectour rights. Any impairment of our intellectual propertyrights, including due to changes in U.S. or foreignintellectual property laws or the absence of effective legalprotections or enforcement measures, could materiallyadversely impact our operations.\\nIncidents leading to damage to our reputation, and any\\nresulting lawsuits, claims or other legal proceedings,could have a material adverse effect on our business.\\nWe believe that our brand image, awareness and\\nreputation strengthen our relationship with consumersand contribute significantly to the success of our business.We strive to create a culture in which our colleagues actwith integrity and respect and feel comfortable speakingup to report instances of misconduct or other concerns.Our ability to attract and retain employees is highlydependent upon our commitment to a diverse andinclusive workplace, ethical business practices and otherqualities. Acts of misconduct by any employee, andparticularly by senior management, could erode trust andconfidence and damage our reputation. Negative publicopinion could result from actual or alleged conduct by usor those currently or formerly associated with us, andfrom any number of activities or circumstances, includingoperations, employment-related offenses (such as sexualharassment and discrimination), regulatory complianceand actions taken by regulators or others in response tosuch conduct. Any damage to our reputation or paymentsof significant amounts, even if reserved, could materiallyand adversely affect our business, reputation, financialcondition, results of operations and cash flows. Wecurrently are, and may in the future be, named as adefendant in lawsuits, claims and other legal proceedingsthat arise in the ordinary course of our business based onalleged acts of misconduct by employees. These actionsseek, among other things, compensation for allegedpersonal injury (including claims for loss of life), workers’compensation, employment discrimination, sexualharassment, workplace misconduct, wage and hour claimsand other employment-related damages, compensationfor breach of contract, statutory or regulatory claims,negligence or gross negligence, punitive damages,consequential damages, and civil penalties or other lossesor injunctive or declaratory relief. The outcome of anyallegations, lawsuits, claims or legal proceedings isinherently uncertain and could result in significant costs,damage to our brands or reputation and diversion ofmanagement’s attention from our business.Company-Specific Financial Factors:\\nCustomer adoption of new software-based\\ntechnologies may require higher quality services fromus, and meeting these demands could create supplychain issues and could increase capital costs.\\nThe communications industry has experienced rapid\\nchanges in the past several years. An increasing numberof our customers are using mobile devices as theirprimary means of viewing video. In addition, businessesand government bodies are broadly shifting to wireless-based services for homes and infrastructure to improveservices to their respective customers and constituencies.We have spent, and continue to spend, significant capitalto shift our wired network to software-based technologyto manage this demand and are expanding 5G wirelesstechnology to address these consumer demands. We areentering into a significant number of software licensingagreements and working with software developers toprovide network functions in lieu of installing switches orother physical network equipment in order to respond torapid developments in wireless demand. While software-based functionality can be changed much more quicklythan, for example, physical switches, the rapid pace ofdevelopment means that we may increasingly need to relyon single-source and software solutions that have notpreviously been deployed in production environments.Should this software not function as intended or ourlicense agreements provide inadequate protection fromintellectual property infringement claims, we could beforced to either substitute (if available) or else spend timeto develop alternative technologies at a much higher costand incur harm to our reputation for reliability, and, as aresult, our ability to remain competitive could bematerially adversely affected.\\nWe depend on various suppliers to provide equipment\\nto operate our business and satisfy customer demandand interruption or delay in supply can adverselyimpact our operating results.\\nWe depend on suppliers to provide us, directly or through\\nother suppliers, with items such as network equipment,customer premises equipment and wireless-relatedequipment such as mobile hotspots, handsets, wirelesslyenabled computers, wireless data cards and otherconnected devices for our customers. These supplierscould fail to provide equipment on a timely or costeffective basis, or fail to meet our performanceexpectations, for a number of reasons, includingdifficulties in obtaining export licenses for certaintechnologies, inflationary pressures, inability to securecomponent parts, general business disruption, naturaldisasters, safety issues, economic and political instability,including the outbreak of war and other hostilities, andpublic health emergencies such as the COVID-19pandemic. These factors have caused, and may againcause, delays in the development, manufacturing(including the sourcing of key components) and shipmentof products to the extent that we or our suppliers areimpacted. In certain limited circumstances, suppliers haveManagement’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n.\\x08',\n", " 'been unable to supply products in a timely fashion,\\naffecting our ability to provide products and servicesprecisely as and when requested by our customers. It ispossible that, in some circumstances, we could be forcedto switch to a different key supplier or be unable to meetcustomer demand for certain products or services.Because of the cost and time lag that can be associatedwith transitioning from one supplier to another, ourbusiness could be substantially disrupted if we wererequired to, or chose to, replace the products of one ormore key suppliers with products from another source,especially if the replacement became necessary on shortnotice. Any such disruption could increase our costs,decrease our operating efficiencies and have a negativeeffect on our operating results.\\nIncreasing costs to provide services and failure to\\nrenew agreements on favorable terms, or at all, couldadversely affect operating margins.\\nOur operating costs, including customer acquisition and\\nretention costs, could continue to put pressure onmargins and customer retention levels.\\nA number of our competitors offering comparable legacy\\nservices that rely on alternative technologies and businessmodels are typically subject to less regulation, andtherefore are able to operate with lower costs. Thesecompetitors generally can focus on discrete customersegments since they do not have regulatory obligations toprovide universal service. Also, these competitors havecost advantages compared to us, due in part to operatingon newer, more technically advanced and lower-costnetworks with a nonunionized workforce, lower employeebenefits and fewer retirees. We are transitioning servicesfrom our old copper-based network and seekingregulatory approvals, where needed, at both the state andfederal levels. If we do not obtain regulatory approvals forour network transition or obtain approvals with onerousconditions, we could experience significant cost andcompetitive disadvantages.\\nWe may not realize or sustain the expected benefits\\nfrom our business transformation initiatives and theseefforts could have a materially adverse effect on ourbusiness, operations, financial condition, results ofoperations and competitive position.\\nWe have been and will be undertaking certain\\ntransformation initiatives, including the WarnerMedia/Discovery Transaction, which are designed to reducecosts, streamline and modernize distribution andcustomer service, remove redundancies and simplify andimprove processes and support functions. Our focus is onsupporting added customer value with an improvedcustomer experience. We intend for these efficiencies toenable increased investments in our strategic areas offocus, which consist of improving broadband connectivity(for example, fiber and 5G). We also expect theseinitiatives to drive efficiencies and improved margins. If wedo not successfully manage and execute these initiatives,or if they are inadequate or ineffective, we may fail tomeet our financial goals and achieve anticipated benefits,\\nimprovements may be delayed, not sustained or notrealized, and our business, operations and competitiveposition could be adversely affected.\\nUnfavorable litigation or governmental investigation\\nresults could require us to pay significant amounts orlead to onerous operating procedures.\\nWe are subject to a number of lawsuits both in the United\\nStates and in foreign countries, including, at any particulartime, claims relating to antitrust, patent infringement,wage and hour, personal injury, customer privacyviolations, regulatory proceedings, breach of contract, andselling and collection practices. We also spend substantialresources complying with various government standards,which may entail related investigations and litigation. Inthe wireless area, we also face current and potentiallitigation relating to alleged adverse health effects oncustomers or employees who use such technologiesincluding, for example, wireless devices. We may incursignificant expenses defending such suits or governmentcharges and may be required to pay amounts orotherwise change our operations in ways that couldmaterially adversely affect our operations or financialresults.\\nCyberattacks impacting our networks or systems may\\nhave a material adverse affect on our operations.\\nCyberattacks, including through the use of malware,\\ncomputer viruses, distributed denial of services attacks,ransomware attacks, credential harvesting, socialengineering and other means for obtaining unauthorizedaccess to or disrupting the operation of our networks andsystems and those of our suppliers, vendors and otherservice providers, could have a material adverse effect onour operations. Cyberattacks can cause equipment ornetwork failures, loss of information, including sensitivepersonal information of customers or employees orproprietary information, as well as disruptions to our orour customers’, suppliers’ or vendors’ operations, whichcould result in significant expenses, potentialinvestigations and legal liability, a loss of current or futurecustomers and reputational damage. Our wired networkin particular is becoming increasingly reliant on softwareas it evolves to handle growing demands for videotransmission. Cyberattacks against companies, includingthe Company and its suppliers and vendors, have occurredand will continue to occur and have increased infrequency, scope and potential harm in recent years. Thedevelopment and maintenance of systems to preventsuch attacks is costly and requires ongoing monitoringand updating. While, to date, we have not been subject tocyberattacks that, individually or in the aggregate, havebeen material to our operations or financial condition, thepreventive actions we take to reduce the risks associatedwith cyberattacks may be insufficient to repel or mitigatethe effects of a major cyberattack in the future.\\n.\\t',\n", " 'Natural disasters, extreme weather conditions or\\nterrorist or other hostile acts could cause damage toour infrastructure and result in significant disruptionsto our operations.\\nOur business operations could be subject to interruption\\nby equipment failures, power outages, terrorist or otherhostile acts, and natural disasters, such as flooding,hurricanes and forest fires, whether caused by discretesevere weather events and/or precipitated by long-termclimate change. Such events could cause significantdamage to the infrastructure upon which our businessoperations rely, resulting in degradation or disruption ofservice to our customers, as well as significant recoverytime and expenditures to resume operations. Our systemredundancy and other measures we take to protect ourinfrastructure and operations from the impacts of suchevents may be ineffective or inadequate to sustain ouroperations through all such events. Any of theseoccurrences could result in lost revenues from businessinterruption, damage to our reputation and reducedprofits.\\nIncreases in our debt levels to fund spectrum\\npurchases, or other strategic decisions could adverselyaffect our ability to finance future debt at attractiverates and reduce our ability to respond to competitionand adverse economic trends.\\nWe have incurred debt to fund significant acquisitions, as\\nwell as spectrum purchases needed to compete in ourindustry. While we believe such decisions were prudentand necessary to take advantage of both growthopportunities and respond to industry developments, wedid experience credit-rating downgrades from historicallevels. Banks and potential purchasers of our publiclytraded debt may decide that these strategic decisions andsimilar actions we may take in the future, as well asexpected trends in the industry, will continue to increasethe risk of investing in our debt and may demand a higherrate of interest, impose restrictive covenants or otherwiselimit the amount of potential borrowing. Additionally, ourcapital allocation plan is focused on, among other things,managing our debt level going forward. Any failure tosuccessfully execute this plan could adversely affect ourcost of funds, liquidity, competitive position and access tocapital markets.\\nOur business may be impacted by changes in tax laws\\nand regulations, judicial interpretations of the same oradministrative actions by federal, state, local andforeign taxing authorities.\\nTax laws are dynamic and subject to change as new laws\\nare passed and new interpretations of the law are issuedor applied. In many cases, the application of existing,newly enacted or amended tax laws (such as the U.S. TaxCuts and Jobs Act of 2017 and the Inflation Reduction Actof 2022) may be uncertain and subject to differinginterpretations, especially when evaluated against everchanging products and services provided by our global\\ntelecommunications and technology businesses. Inaddition, tax legislation has been introduced or is beingconsidered in various jurisdictions that could significantlyimpact our tax rate, tax liabilities, and carrying value ofdeferred tax assets or deferred tax liabilities. Any of thesechanges could materially impact our financialperformance and our tax provision, net income and cashflows.\\nWe are also subject to ongoing examinations by taxing\\nauthorities in various jurisdictions. Although we regularlyassess the likelihood of an adverse outcome resultingfrom these examinations to determine the adequacy ofprovisions for taxes, there can be no assurance as to theoutcome of these examinations. In the event that we havenot accurately or fully described, disclosed or determined,calculated or remitted amounts that were due to taxingauthorities or if the ultimate determination of our taxesowed is for an amount in excess of amounts previouslyaccrued, we could be subject to additional taxes, penaltiesand interest, which could materially impact our business,financial condition and operating results.\\nIf the distribution of WarnerMedia, together with\\ncertain related transactions, were to fail to qualify fornon-recognition treatment for U.S. federal income taxpurposes under audit, then we could be subject tosignificant tax liability.\\nIn connection with the WarnerMedia/Discovery\\nTransaction, AT&T received a favorable Private LetterRuling from the IRS. Nonetheless, the IRS or anotherapplicable tax authority could determine on audit that thedistribution by us of WarnerMedia to our stockholders andcertain related transactions should be treated as taxabletransactions if it determines that any of the facts,representations or undertakings made in connection withthe request for the ruling were incorrect or are violated.We may be entitled to indemnification from Warner Bros.Discovery (Warner Bros.) in the case of certain breaches ofrepresentations or undertakings by Warner Bros. underthe tax matters agreement related to the WarnerMedia/Discovery Transaction. However, we could potentially berequired to pay such tax prior to reimbursement fromWarner Bros., and such indemnification is subject toWarner Bros.’ credit risk. If the IRS or another tax authoritywere to so conclude, there could be a material adverseimpact on our business, financial condition, results ofoperations and cash flows.Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n. ',\n", " 'CAUTIONARY LANGUAGE CONCERNING FORWARD-\\nLOOKING STATEMENTS\\nInformation set forth in this report contains forward-looking statements\\nthat are subject to risks and uncertainties, and actual results could differmaterially. Many of these factors are discussed in more detail in the “RiskFactors” section. We claim the protection of the safe harbor for forward-looking statements provided by the Private Securities Litigation ReformAct of 1995.\\nThe following factors could cause our future results to differ materially\\nfrom those expressed in the forward-looking statements:\\n• The severity, magnitude and duration of the COVID-19 pandemic and\\ncontainment, mitigation and other measures taken in response,including the potential impacts of these matters on our business andoperations.\\n• Our inability to predict the extent to which the COVID-19 pandemic\\nand related impacts will continue to impact our business operations,financial performance and results of operations.\\n• Adverse economic, political and/or capital access changes or war or\\nother hostilities in the markets served by us or in countries in whichwe have investments and/or operations, including inflationarypressures, the impact on customer demand and our ability and oursuppliers’ ability to access financial markets at favorable rates andterms.\\n• Increases in our benefit plans’ costs, including increases due to\\nadverse changes in the United States and foreign securities markets,resulting in worse-than-assumed investment returns and discountrates; adverse changes in mortality assumptions; adverse medicalcost trends; and unfavorable or delayed implementation or repeal ofhealthcare legislation, regulations or related court decisions.\\n• The final outcome of FCC and other federal, state or foreign\\ngovernment agency proceedings (including judicial review, if any, ofsuch proceedings) and legislative efforts involving issues that areimportant to our business, including, without limitation, pendingNotices of Apparent Liability; the transition from legacy technologiesto IP-based infrastructure, including the withdrawal of legacy TDM-based services; universal service; broadband deployment; wirelessequipment siting regulations and, in particular, siting for 5G service;E911 services; rules concerning digital discrimination; competitionpolicy; privacy; net neutrality; copyright protection; availability ofnew spectrum on fair and balanced terms; and wireless and satellitelicense awards and renewals.\\n• Enactment of additional state, local, federal and/or foreign\\nregulatory and tax laws and regulations, or changes to existingstandards and actions by tax agencies and judicial authoritiesincluding the resolution of disputes with any taxing jurisdictions,pertaining to our subsidiaries and foreign investments, includinglaws and regulations that reduce our incentive to invest in ournetworks, resulting in lower revenue growth and/or higher operatingcosts.\\n• U.S. and foreign laws and regulations regarding intellectual property\\nrights protection and privacy, personal data protection and userconsent, which are complex and rapidly evolving and could result inadverse impacts to our business plans, increased costs, or claimsagainst us that may harm our reputation.\\n• Our ability to compete in an increasingly competitive industry and\\nagainst competitors that can offer product/service offerings at lowerprices due to lower cost structures and regulatory and legislativeactions adverse to us, including non-regulation of comparablealternative technologies and/or government-owned or subsidizednetworks.• Disruption in our supply chain for a number of reasons, including,\\ndifficulties in obtaining export licenses for certain technology,inability to secure component parts, general business disruption,workforce shortage, natural disasters, safety issues, vendor fraud,economic and political instability, including the outbreak of war orother hostilities, and public health emergencies.\\n• The continued development and delivery of attractive and profitable\\nwireless, and broadband offerings and devices; the extent to whichregulatory and build-out requirements apply to our offerings; ourability to match speeds offered by our competitors; and theavailability, cost and/or reliability of the various technologies and/orcontent required to provide such offerings.\\n• The availability and cost and our ability to adequately fund additional\\nwireless spectrum and network development, deployment andmaintenance; and regulations and conditions relating to spectrumuse, licensing, obtaining additional spectrum, technical standards anddeployment and usage, including network management rules.\\n• Our ability to manage growth in wireless data services, including\\nnetwork quality and acquisition of adequate spectrum at reasonablecosts and terms.\\n• The outcome of pending, threatened or potential litigation (which\\nincludes arbitrations), including, without limitation, patent andproduct safety claims by or against third parties or claims based onalleged misconduct by employees.\\n• The impact from major equipment or software failures on our\\nnetworks or cyber incidents; the effect of security breaches relatedto the network or customer information; our inability to obtainhandsets, equipment/software or have handsets, equipment/software serviced in a timely and cost-effective manner fromsuppliers; or severe weather conditions or other climate relatedevents including flooding and hurricanes, natural disasters includingearthquakes and forest fires, pandemics, energy shortages, wars orterrorist attacks.\\n• The issuance by the FASB or other accounting oversight bodies of\\nnew accounting standards or changes to existing standards.\\n• Our response to competition and regulatory, legislative and\\ntechnological developments.\\n• The uncertainty surrounding further congressional action regarding\\nspending and taxation, which may result in changes in governmentspending and affect the ability and willingness of businesses andconsumers to spend in general.\\n• Our ability to realize or sustain the expected benefits of our business\\ntransformation initiatives, which are designed to reduce costs,streamline distribution, remove redundancies and simplify andimprove processes and support functions.\\n• Our ability to successfully complete divestitures, as well as achieve\\nour expectations regarding the financial impact of the completedand/or pending transactions.\\nReaders are cautioned that other factors discussed in this report,\\nalthough not enumerated here, also could materially affect our futureearnings.\\n..',\n", " '2022 2021 2020\\nOperating Revenues\\nService $ 97,831 $ 111,565 $ 124,057\\nEquipment 22,910 22,473 18,993\\nTotal operating revenues 120,741 134,038 143,050\\nOperating Expenses\\nCost of revenues\\nEquipment 24,009 23,685 19,585\\nBroadcast, programming and operations — 8,106 16,077\\nOther cost of revenues (exclusive of depreciation\\nand amortization shown separately below) 26,839 28,616 29,989\\nSelling, general and administrative 28,961 29,669 30,817\\nAsset impairments and abandonments and restructuring 27,498 213 15,687\\nDepreciation and amortization 18,021 17,852 22,523\\nTotal operating expenses 125,328 108,141 134,678\\nOperating Income (Loss) (4,587) 25,897 8,372\\nOther Income (Expense)\\nInterest expense (6,108) (6,716) (7,727)\\nEquity in net income of affiliates 1,791 603 89\\nOther income (expense) – net 5,810 9,387 (1,088)\\nTotal other income (expense) 1,493 3,274 (8,726)\\nIncome (Loss) from Continuing Operations Before Income Taxes (3,094) 29,171 (354)\\nIncome tax expense on continuing operations 3,780 5,395 1,168\\nIncome (Loss) from Continuing Operations (6,874) 23,776 (1,522)\\nLoss from discontinued operations, net of tax (181) (2,297) (2,299)\\nNet Income (Loss) (7,055) 21,479 (3,821)\\nLess: Net Income Attributable to Noncontrolling Interest (1,469) (1,398) (1,355)\\nNet Income (Loss) Attributable to AT&T $ (8,524) $ 20,081 $ (5,176)\\nLess: Preferred Stock Dividends (203) (207) (193)\\nNet Income (Loss) Attributable to Common Stock $ (8,727) $ 19,874 $ (5,369)\\nBasic Earnings (Loss) Per Share from continuing operations $ (1.10) $ 3.07 $ (0.45)\\nBasic Loss Per Share from discontinued operations $ (0.03) $ (0.30) $ (0.30)\\nBasic Earnings (Loss) Per Share Attributable to Common Stock $ (1.13) $ 2.77 $ (0.75)\\nDiluted Earnings (Loss) Per Share from continuing operations $ (1.10) $ 3.02 $ (0.45)\\nDiluted Loss Per Share from discontinued operations $ (0.03) $ (0.29) $ (0.30)\\nDiluted Earnings (Loss) Per Share Attributable to Common Stock $ (1.13) $ 2.73 $ (0.75)\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Statements of Income\\nDollars in millions except per share amounts\\n.:',\n", " '2022 2021 2020\\nNet income (loss) $ (7,055) $ 21,479 $ (3,821)\\nOther comprehensive income (loss), net of tax:Foreign Currency:\\nTranslation adjustment (includes $0, $(2) and $(59) attributable to\\nnoncontrolling interest), net of taxes of $90, $(44) and $(42) 346 (127) (929)\\nReclassification adjustment included in net income (loss), net of taxes of\\n$0, $204 and $0 — 2,087 —\\nDistributions of WarnerMedia, net of taxes of $(38), $0 and $0 (182) ——\\nSecurities:\\nNet unrealized gains (losses), net of taxes of $(49), $(21) and $27 (143) (63) 78\\nReclassification adjustment included in net income (loss),\\nnet of taxes of $3, $(1) and $(5) 8 (3) (15)\\nDerivative Instruments:\\nNet unrealized gains (losses), net of taxes of $(183), $(192) and $(212) (648) (715) (811)\\nReclassification adjustment included in net income (loss),\\nnet of taxes of $25, $19 and $18 96 72 69\\nDistributions of WarnerMedia, net of taxes of $(12), $0 and $0 (24) ——\\nDefined benefit postretirement plans:\\nNet prior service (cost) credit arising during period, net of taxes of $583,\\n$(8) and $735 1,787 (34) 2,250\\nAmortization of net prior service credit included in net income (loss),\\nnet of taxes of $(663), $(660) and $(601) (2,028) (2,020) (1,841)\\nDistribution of WarnerMedia, net of taxes of $5, $0 and $0 25 ——\\nOther comprehensive income (loss) (763) (803) (1,199)\\nTotal comprehensive income (loss) (7,818) 20,676 (5,020)\\nLess: Total comprehensive income attributable to noncontrolling interest (1,469) (1,396) (1,296)\\nTotal Comprehensive Income (Loss) Attributable to AT&T $ (9,287) $ 19,280 $ (6,316)\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Statements of Comprehensive Income\\nDollars in millions except per share amounts\\n.,',\n", " 'December 31,\\n2022 2021\\nAssets\\nCurrent AssetsCash and cash equivalents $ 3,701 $ 19,223\\nAccounts receivable – net of related allowance for credit loss of $588 and $658 11,466 12,313\\nInventories 3,123 3,325\\nPrepaid and other current assets 14,818 16,131\\nAssets from discontinued operations — 119,776\\nTotal current assets 33,108 170,768\\nProperty, Plant and Equipment – Net 127,445 121,649\\nGoodwill – Net 67,895 92,740\\nLicenses – Net 124,092 113,830\\nOther Intangible Assets – Net 5,354 5,391\\nInvestments in and Advances to Equity Affiliates 3,533 6,168\\nOperating Lease Right-Of-Use Assets 21,814 21,824\\nOther Assets 19,612 19,252\\nTotal Assets $ 402,853 $ 551,622\\nLiabilities and Stockholders’ Equity\\nCurrent LiabilitiesDebt maturing within one year $7 , 4 6 7 $ 24,620\\nNote payable to DIRECTV 130 1,245\\nAccounts payable and accrued liabilities 42,644 39,095\\nAdvanced billings and customer deposits 3,918 3,966\\nDividends payable 2,014 3,749\\nLiabilities from discontinued operations — 33,555\\nTotal current liabilities 56,173 106,230\\nLong-Term Debt 128,423 151,011\\nDeferred Credits and Other Noncurrent LiabilitiesDeferred income taxes 57,032 53,767\\nPostemployment benefit obligation 7,260 12,560\\nOperating lease liabilities 18,659 18,956\\nOther noncurrent liabilities 28,849 25,243\\nTotal deferred credits and other noncurrent liabilities 111,800 110,526\\nStockholders’ Equity\\nPreferred stock ($1 par value, 10,000,000 authorized at December 31, 2022\\nand December 31, 2021):\\nSeries A (48,000 issued and outstanding at December 31, 2022 and December 31, 2021) — —\\nSeries B (20,000 issued and outstanding at December 31, 2022 and December 31, 2021) — —\\nSeries C (70,000 issued and outstanding at December 31, 2022 and December 31, 2021) — —\\nCommon stock ($1 par value, 14,000,000,000 authorized at December 31, 2022 and\\nDecember 31, 2021: issued 7,620,748,598 at December 31, 2022 and December 31, 2021) 7,621 7,621\\nAdditional paid-in capital 123,610 130,112\\nRetained (deficit) earnings (19,415)\\n42,350\\nTreasury stock (493,156,816 at December 31, 2022 and 479,684,705 at December 31, 2021, at cost) (17,082) (17,280)\\nAccumulated other comprehensive income 2,766 3,529\\nNoncontrolling interest 8,957 17,523\\nTotal stockholders’ equity 106,457 183,855\\nTotal Liabilities and Stockholders’ Equity $ 402,853 $ 551,622\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Balance Sheets\\nDollars in millions except per share amounts\\n.;',\n", " '2022 2021 2020\\nOperating Activities\\nIncome (loss) from continuing operations $ (6,874) $ 23,776 $ (1,522)\\nAdjustments to reconcile net income (loss) from continuing operations to net cash provided\\nby operating activities from continuing operations:\\nDepreciation and amortization 18,021 17,852 22,523\\nProvision for uncollectible accounts 1,865 1,241 1,798\\nDeferred income tax expense 2,975 7,412 2,145\\nNet (gain) loss on investments, net of impairments 381 (369) (970)\\nPension and postretirement benefit expense (credit) (3,237) (3,857) (2,992)\\nActuarial (gain) loss on pension and postretirement benefits (1,999) (4,143) 4,169\\nAsset impairments and abandonments and restructuring 27,498 213 15,687\\nChanges in operating assets and liabilities:\\nReceivables 727 (1,125) 1,079\\nOther current assets (674) (1,288) (2,138)\\nAccounts payable and other accrued liabilities (1,109) (1,570) (1,895)\\nEquipment installment receivables and related sales 154 (271) (1,428)\\nDeferred customer contract acquisition and fulfillment costs (947) 18 382\\nPostretirement claims and contributions (823) (822) (985)\\nOther – net (146) 103 1,631\\nTotal adjustments 42,686 13,394 39,006\\nNet Cash Provided by Operating Activities from Continuing Operations 35,812 37,170 37,484\\nInvesting Activities\\nCapital expenditures (19,626) (15,545) (14,690)\\nAcquisitions, net of cash acquired (10,200) (25,453) (1,625)\\nDispositions 199 7,136 2,472\\nDistributions from DIRECTV in excess of cumulative equity in earnings 2,649 1,323 —\\nOther – net 79 50 396\\nNet Cash Used in Investing Activities from Continuing Operations (26,899) (32,489) (13,447)\\nFinancing Activities\\nNet change in short-term borrowings with original maturities of three months or less (519) 1,316 (17)\\nIssuance of other short-term borrowings 3,955 21,856 9,440\\nRepayment of other short-term borrowings (18,345) (7,510) (9,467)\\nIssuance of long-term debt 2,979 9,931 31,988\\nRepayment of long-term debt (25,118) (3,039) (39,062)\\nNote payable to DIRECTV, net of payments (1,211) 1,341 —\\nPayment of vendor financing (4,697) (4,596) (2,966)\\nIssuance of preferred stock — — 3,869\\nPurchase of treasury stock (890) (202) (5,498)\\nIssuance of treasury stock 28 96 105\\nIssuance of preferred interests in subsidiaries — — 1,979\\nRedemption of preferred interest in subsidiary (2,665) — (1,950)\\nDividends paid (9,859) (15,068) (14,956)\\nOther – net (3,222) (2,231) (4,496)\\nNet Cash (Used in) Provided by Financing Activities from Continuing Operations (59,564) 1,894 (31,031)\\nNet (decrease) increase in cash and cash equivalents and restricted cash from continuing\\noperations (50,651) 6,575 (6,994)\\nCash flows from Discontinued Operations:Cash (used in) provided by operating activities (3,789) 4,788 5,645\\nCash provided by (used in) investing activities 1,094 399 (102)\\nCash provided by (used in) financing activities 35,823 (316) (974)\\nNet increase (decrease) in cash and cash equivalents and restricted cash from discontinued\\noperations 33,128 4,871 4,569\\nNet (decrease) increase in cash and cash equivalents and restricted cash (17,523) 11,446 (2,425)\\nCash and cash equivalents and restricted cash beginning of year 21,316 9,870 12,295\\nCash and Cash Equivalents and Restricted Cash End of Year $ 3,793 $ 21,316 $ 9,870\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Statements of Cash Flows\\nDollars in millions except per share amounts\\n.?',\n", " '2022 2021 2020\\nShares Amount Shares Amount Shares Amount\\nPreferred Stock – Series A\\nBalance at beginning of year —$ — —$ — —$ —\\nBalance at end of year —$ — —$ — —$ —\\nPreferred Stock – Series B\\nBalance at beginning of year —$ — —$ — —$ —\\nBalance at end of year —$ — —$ — —$ —\\nPreferred Stock – Series C\\nBalance at beginning of year —$ — —$ — —$ —\\nBalance at end of year —$ — —$ — —$ —\\nCommon Stock\\nBalance at beginning of year 7,621 $ 7,621 7,621 $ 7,621 7,621 $ 7,621\\nBalance at end of year 7,621 $ 7,621 7,621 $ 7,621 7,621 $ 7,621\\nAdditional Paid-In Capital\\nBalance at beginning of year $ 130,112 $ 130,175 $ 126,279\\nDistribution of WarnerMedia (6,832) ——\\nRepurchase and acquisition of common stock — —6 7\\nIssuance of preferred stock — — 3,869\\nIssuance of treasury stock (171) (76) (62)\\nShare-based payments (162) 13 18\\nAcquisition or reclassification of interests\\nheld by noncontrolling owners 663 —4\\nBalance at end of year $ 123,610 $ 130,112 $ 130,175\\nRetained (Deficit) Earnings\\nBalance at beginning of year $ 42,350 $ 37,457 $ 57,936\\nCumulative effect of accounting changes\\nand other adjustments — — (293)\\nAdjusted beginning balance 42,350 37,457 57,643\\nNet income (loss) attributable to AT&T (8,524) 20,081 (5,176)\\nDistribution of WarnerMedia (45,041) ——\\nPreferred stock dividends (207) (224) (139)\\nCommon stock dividends ($1.11, $2.08 and $2.08 per share) (7,993) (14,964) (14,871)\\nBalance at end of year $ (19,415) $ 42,350 $ 37,457\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Statements of Changes in Stockholders’ Equity\\nDollars and shares in millions except per share amounts\\n.!',\n", " '2022 2021 2020\\nShares Amount Shares Amount Shares Amount\\nTreasury Stock\\nBalance at beginning of year (480) $ (17,280) (495) $ (17,910) (366) $ (13,085)\\nRepurchase and acquisition of common stock (44) (890) (8) (237) (150) (5,631)\\nIssuance of treasury stock 31 1,088 23 867 21 806\\nBalance at end of year (493) $ (17,082) (480) $ (17,280) (495) $ (17,910)\\nAccumulated Other Comprehensive Income\\nAttributable to AT&T, net of tax\\nBalance at beginning of year $ 3,529 $ 4,330 $ 5,470\\nOther comprehensive income (loss) attributable to AT&T (763) (801) (1,140)\\nBalance at end of year $ 2,766 $ 3,529 $ 4,330\\nNoncontrolling Interest\\nBalance at beginning of year $ 17,523 $ 17,567 $ 17,713\\nCumulative effect of accounting\\nchanges and other adjustments — — (7)\\nAdjusted beginning balance 17,523 17,567 17,706\\nNet income attributable to\\nnoncontrolling interest 1,469 1,398 1,355\\nIssuance and acquisition (disposition) of\\nnoncontrolling owners (21) 7 1,979\\nRedemption of noncontrolling interest (2,665) — (1,950)\\nReclassification of noncontrolling interest (5,997) ——\\nDistributions (1,352) (1,447) (1,464)\\nTranslation adjustments attributable to\\nnoncontrolling interest, net of taxes — (2) (59)\\nBalance at end of year $ 8,957 $ 17,523 $ 17,567\\nTotal Stockholders’ Equity at beginning of year $ 183,855 $ 179,240 $ 201,934\\nTotal Stockholders’ Equity at end of year $ 106,457 $ 183,855 $ 179,240\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Statements of Changes in Stockholders’ Equity – continued\\nDollars and shares in millions except per share amounts\\n.¿',\n", " 'NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING\\nPOLICIES\\nBasis of Presentation Throughout this document, AT&T\\nInc. is referred to as “AT&T,” “we” or the “Company.” Theconsolidated financial statements include the accounts ofthe Company and subsidiaries and affiliates which wecontrol. AT&T is a holding company whose subsidiariesand affiliates operate worldwide in thetelecommunications and technology industries.\\nOn April 8, 2022, we completed the separation of our\\nWarnerMedia business, which represented substantially allof our WarnerMedia segment, in a Reverse Morris Trusttransaction, under which Magallanes, Inc. (Spinco), aformerly wholly-owned subsidiary of AT&T that held theWarnerMedia business, was distributed to AT&Tstockholders via a pro rata dividend, followed by thecombination of Spinco with a subsidiary of Discovery, Inc.(Discovery), which was renamed Warner Bros. Discovery,Inc. (WBD). (See Note 6)\\nUpon the separation and distribution, the WarnerMedia\\nbusiness met the criteria for discontinued operations. Fordiscontinued operations, we also evaluated transactionsthat were components of AT&T’s single plan of a strategicshift, including dispositions that previously did notindividually meet the criteria due to materiality, and havedetermined discontinued operations to be comprised ofWarnerMedia, Vrio, Xandr and Playdemic Ltd. (Playdemic).These businesses are reflected in the accompanyingfinancial statements as discontinued operations, includingfor periods prior to the consummation of theWarnerMedia/Discovery transaction. (See Notes 6 and 23)\\nOn July 31, 2021, we closed our transaction with TPG\\nCapital (TPG) to form a new company named DIRECTVEntertainment Holdings, LLC (DIRECTV). With the close ofthe transaction, we separated and deconsolidated ourVideo business, comprised of our U.S. video operations,and began accounting for our investment in DIRECTVunder the equity method (see Notes 6, 10 and 19).\\nAll significant intercompany transactions are eliminated in\\nthe consolidation process. Investments in subsidiaries andpartnerships which we do not control but have significantinfluence are accounted for under the equity method.Earnings from certain investments accounted for usingthe equity method are included in our results on a onequarter lag. We also record our proportionate share of ourequity method investees’ other comprehensive income(OCI) items, including translation adjustments. We treatdistributions received from equity method investees asreturns on investment and classify them as cash flowsfrom operating activities until those distributions exceedour cumulative equity in the earnings of that investment.We treat the excess amount as a return of investment andclassify it as cash flows from investing activities.\\nThe preparation of financial statements in conformity\\nwith U.S. generally accepted accounting principles (GAAP)requires management to make estimates andassumptions, including other estimates of fair value,\\nprobable losses and expenses, that affect the amountsreported in the financial statements and accompanyingnotes. Actual results could differ from those estimates.Moreover, unfavorable changes in market conditions,including interest rates, could adversely impact thoseestimates and result in asset impairments. Certain prior-period amounts have been conformed to the currentperiod’s presentation. Unless otherwise noted, theinformation in Notes 1 through 22 and 24 refer only to ourcontinuing operations and do not include discussion ofbalances or activity of WarnerMedia, Vrio, Xandr andPlaydemic, which are part of discontinued operations.\\nAdopted and New Accounting StandardsConvertible Instruments Beginning with 2022 interim\\nreporting, we adopted, through retrospective application,the Financial Accounting Standards Board’s (FASB)Accounting Standards Update (ASU) No. 2020-06, “Debt—Debt With Conversion and Other Options (Subtopic470-20) and Derivatives and Hedging—Contracts inEntity’s Own Equity (Subtopic 815-40): Accounting forConvertible Instruments and Contracts in an Entity’s OwnEquity” (ASU 2020-06). ASU 2020-06 requires thatinstruments which may be settled in cash or stock arepresumed settled in stock in calculating diluted earningsper share. While our intent is to settle the Series ACumulative Perpetual Membership Interests in AT&TMobility II LLC (Mobility preferred interests) in cash,settlement of this instrument in AT&T shares would resultin additional dilutive impact, the magnitude of which isinfluenced by the fair value of the Mobility preferredinterests and the average AT&T common stock priceduring the reporting period, which could vary from period-to-period (see Note 16).\\nThe following table presents the impact of the adoption\\nof ASU 2020-06 on our diluted earnings per share fromcontinuing operations:\\nDiluted earnings per share from\\ncontinuing operations:Historical\\nAccounting\\nMethodEffect of\\nAdoption\\nof ASU\\n2020-061Under ASU\\n2020-06\\nYear ended December 31, 2022 $ (1.10) $ — $ (1.10)\\nYear ended December 31, 2021 $ 3.07 $ (0.05) $ 3.02\\nYear ended December 31, 2020 $ (0.45) $ — $ (0.45)\\n1See Note 2 for a discussion of the numerator and denominator adjustments.\\nReference Rate Reform In March 2020, the FASB issued\\nASU No. 2020-04, “Reference Rate Reform (Topic 848):Facilitation of the Effects of Reference Rate Reform onFinancial Reporting” (ASU 2020-04, as amended), whichprovides optional expedients, and allows for certainexceptions to existing GAAP, for contract modificationstriggered by the expected market transition of certainbenchmark interest rates to alternative reference rates.ASU 2020-04 applies to contracts, hedging relationships,Notes to Consolidated Financial Statements\\nDollars in millions except per share amounts\\n:\\x08',\n", " 'certain derivatives and other arrangements that\\nreference the London Interbank Offering Rate (LIBOR) orany other rates ending after December 31, 2024. ASU2020-04, as amended, became effective immediately. Wedo not believe our adoption of ASU 2020-04, includingoptional expedients, will materially impact our financialstatements.\\nGovernment Assistance In November 2021, the FASB\\nissued ASU No. 2021-10, “Government Assistance (Topic832): Disclosures by Business Entities about GovernmentAssistance” (ASU 2021-10), which requires annualdisclosures (e.g., terms and conditions, accountingtreatment, impacted financial statement lines), in thenotes to the financial statements, about transactions witha government that are accounted for by applying a grantor contribution accounting model by analogy to otherguidance. We adopted ASU 2021-10 effective for theannual reporting period ended December 31, 2022, asrequired, under prospective application, with no requiredupdates to our disclosures.\\nCredit Losses As of January 1, 2020, we adopted,\\nthrough modified retrospective application, ASU No.2016-13, “Financial Instruments—Credit Losses (Topic 326):Measurement of Credit Losses on Financial Instruments,”or Accounting Standards Codification (ASC) 326 (ASC 326),which replaces the incurred loss impairment methodologyunder prior GAAP with an expected credit loss model. ASC326 affects trade receivables, loans, contract assets,certain beneficial interests, off-balance-sheet creditexposures not accounted for as insurance and otherfinancial assets that are not subject to fair value throughnet income, as defined by the standard. Under theexpected credit loss model, we are required to considerfuture economic trends to estimate expected creditlosses over the lifetime of the asset. Upon adoption onJanuary 1, 2020, we recorded a $293 reduction to“Retained earnings,” $395 increase to “Allowances forcredit losses” applicable to our trade and loan receivables,$10 reduction of contract assets, $105 reduction of netdeferred income tax liability and $7 reduction of“Noncontrolling interest.” Our adoption of ASC 326 did nothave a material impact on our financial statements.\\nSupplier Finance Obligations In September 2022, the\\nFASB issued ASU No. 2022-04, “Liabilities – SupplierFinance Programs (Subtopic 405-50): Disclosure ofSupplier Finance Program Obligations” (ASU 2022-04),which establishes interim and annual reporting disclosurerequirements about a company’s supplier financeprograms for its purchase of goods and services. Interimand annual requirements include disclosure ofoutstanding amounts under the obligations as of the endof the reporting period, and annual requirements include arollforward of those obligations for the annual reportingperiod, as well as a description of payment and other keyterms of the programs. ASU 2022-04 will be effective forinterim and annual periods beginning after December 15,2022, with retrospective application, except for the annualrollforward requirement, which becomes effective forannual periods beginning after December 15, 2023, with\\nprospective application. The standard allows earlyadoption of all requirements. In the year of adoption, thedisclosure of payment and other key terms under theprograms and outstanding balances under the obligationswill also apply to interim reporting dates. We are in theprocess of evaluating the impact of our adoption of ASU2022-04.\\nAccounting PoliciesIncome Taxes We record deferred income taxes for\\ntemporary differences between the carrying amounts ofassets and liabilities for financial reporting purposes andthe computed tax basis of those assets and liabilities. Werecord valuation allowances against the deferred taxassets (included, together with our deferred income taxassets, as part of our reportable net deferred income taxliabilities on our consolidated balance sheets), for whichthe realization is uncertain. We review these itemsregularly in light of changes in federal, state and foreigntax laws and changes in our business.\\nAs of January 1, 2021, we adopted, with modified\\nretrospective application, the FASB’s ASU No. 2019-12,“Income Taxes (Topic 740): Simplifying the Accounting forIncome Taxes” (ASU 2019-12), which simplified income taxaccounting requirements in areas deemed costly andcomplex. ASU 2019-12 did not have a material impact onour financial statements.\\nCash and Cash Equivalents Cash and cash equivalents\\ninclude all highly liquid investments with originalmaturities of three months or less. The carrying amountsapproximate fair value. At December 31, 2022, we held$866 in cash and $2,835 in money market funds and othercash equivalents. Of our total cash and cash equivalents,$1,045 resided in foreign jurisdictions, some of which issubject to restrictions on repatriation.\\nAllowance for Credit Losses We record expense to\\nmaintain an allowance for credit losses for estimatedlosses that result from the failure or inability of ourcustomers to make required payments deemed collectiblefrom the customer when the service was provided orproduct was delivered. When determining the allowancesfor trade receivables and loans, we consider theprobability of recoverability of accounts receivable basedon past experience, taking into account current collectiontrends and general economic factors, includingbankruptcy rates. We also consider future economictrends to estimate expected credit losses over thelifetime of the asset. Credit risks are assessed based onhistorical write-offs, net of recoveries, as well as ananalysis of the aged accounts receivable balances withallowances generally increasing as the receivable ages.Accounts receivable may be fully reserved for whenspecific collection issues are known to exist, such ascatastrophes or pending bankruptcies.\\n:\\t',\n", " 'Inventories Inventories primarily consist of wireless\\ndevices and accessories and are valued at the lower ofcost or net realizable value.\\nProperty, Plant and Equipment Property, plant and\\nequipment is stated at cost, except for assets acquiredusing acquisition accounting, which are initially recordedat fair value (see Note 7). The cost of additions andsubstantial improvements to property, plant andequipment is capitalized, and includes internalcompensation costs for these projects. The cost ofmaintenance and repairs of property, plant andequipment is charged to operating expenses. Property,plant and equipment costs are depreciated using straight-line methods over their estimated economic lives. Certainsubsidiaries follow composite group depreciationmethodology. Accordingly, when a portion of theirdepreciable property, plant and equipment is retired in theordinary course of business, the gross book value isreclassified to accumulated depreciation, and no gain orloss is recognized on the disposition of these assets.\\nProperty, plant and equipment is reviewed for\\nrecoverability whenever events or changes incircumstances indicate that the carrying amount of anasset group may not be recoverable. We recognize animpairment loss when the carrying amount of a long-livedasset is not recoverable. The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of theundiscounted cash flows expected to result from the useand eventual disposition of the asset. (See Note 7)\\nThe liability for the fair value of an asset retirement\\nobligation is recorded in the period in which it is incurred ifa reasonable estimate of fair value can be made. Inperiods subsequent to initial measurement, we recognizeperiod-to-period changes in the liability resulting from thepassage of time and revisions to either the timing or theamount of the original estimate. The increase in thecarrying value of the associated long-lived asset isdepreciated over the corresponding estimated economiclife.\\nSoftware Costs We capitalize certain costs incurred in\\nconnection with developing or obtaining internal-usesoftware. Capitalized software costs are included in“Property, Plant and Equipment – Net” on our consolidatedbalance sheets. In addition, there is certain networksoftware that allows the equipment to provide thefeatures and functions unique to the AT&T network, whichwe include in the cost of the equipment categories forfinancial reporting purposes.\\nWe amortize our capitalized software costs over a three-\\nyear to seven-year period, reflecting the estimated periodduring which these assets will remain in service.\\nGoodwill and Other Intangible Assets We have the\\nfollowing major classes of intangible assets: goodwill;licenses, which include Federal CommunicationsCommission (FCC) and other wireless licenses; trademarksand trade names; customer lists; and various other finite-lived intangible assets (see Note 9).Goodwill represents the excess of consideration paid over\\nthe fair value of identifiable net assets acquired inbusiness combinations. Wireless licenses provide us withthe exclusive right to utilize certain radio frequencyspectrum to provide wireless communications services.While wireless licenses are issued for a fixed period of time(generally ten years), renewals of domestic wirelesslicenses have occurred routinely and at nominal cost. Wehave determined that there are currently no legal,regulatory, contractual, competitive, economic or otherfactors that limit the useful lives of our FCC wirelesslicenses.\\nWe amortize our wireless licenses in Mexico over their\\naverage remaining economic life of 25 years.\\nWe acquired the rights to the AT&T and other trade\\nnames in previous acquisitions, classifying certain of thosetrade names as indefinite-lived. We have the effectiveability to retain these exclusive rights permanently at anominal cost.\\nGoodwill, FCC wireless licenses and other indefinite-lived\\nintangible assets are not amortized but are tested at leastannually for impairment (see Note 9). The testing isperformed on the value as of October 1 each year andcompares the book values of the assets to their fairvalues. Goodwill is tested by comparing the carryingamount of each reporting unit, deemed to be our principaloperating segments or one level below them, to the fairvalue using both discounted cash flow as well as marketmultiple approaches. FCC wireless licenses are tested onan aggregate basis, consistent with our use of the licenseson a national scope, using a discounted cash flowapproach. Trade names are tested by comparing theirbook values to their fair values calculated using adiscounted cash flow approach on a presumed royaltyrate derived from the revenues related to each brandname.\\nIntangible assets that have finite useful lives are\\namortized over their estimated economic lives (see Note9). Customer lists and relationships are amortized usingprimarily the sum-of-the-months-digits method ofamortization over the period in which those relationshipsare expected to contribute to our future cash flows.Finite-lived trademarks and trade names are amortizedusing the straight-line method over the estimated usefullife of the assets. The remaining finite-lived intangibleassets are generally amortized using the straight-linemethod. These assets, along with other long-lived assets,are reviewed for recoverability whenever events orchanges in circumstances indicate that the carryingamount of an asset group may not be recoverable.\\nAdvertising Costs We expense advertising costs for\\nproducts and services or for promoting our corporateimage as incurred (see Note 22).Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n: ',\n", " 'Foreign Currency Translation Our foreign subsidiaries\\nand foreign investments generally report their earnings intheir local currencies. We translate their foreign assetsand liabilities at exchange rates in effect at the balancesheet dates. We translate their revenues and expensesusing average rates during the year. The resulting foreigncurrency translation adjustments are recorded as aseparate component of accumulated OCI in ourconsolidated balance sheets (see Note 3).We hedge a portion of the foreign currency exchange risk\\ninvolved in certain foreign currency-denominatedtransactions, which we explain further in our discussion ofour methods of managing our foreign currency risk (seeNote 12).\\nPension and Other Postretirement Benefits See Note 14\\nfor a comprehensive discussion of our pension andpostretirement benefits, including a discussion of theactuarial assumptions, our policy for recognizing theassociated gains and losses and our method used toestimate service and interest cost components.\\nNOTE 2. EARNINGS PER SHARE\\nA reconciliation of the numerators and denominators of basic and diluted earnings per share is shown in the table below:\\nYear Ended December 31, 2022 2021 2020\\nNumerators\\nNumerator for basic earnings per share:\\nIncome (loss) from continuing operations, net of tax $ (6,874) $ 23,776 $ (1,522)\\nNet income from continuing operations attributable to noncontrolling interests (1,469) (1,485) (1,470)\\nPreferred Stock Dividends (203) (207) (193)\\nIncome (loss) from continuing operations attributable to common stock (8,546) 22,084 (3,185)\\nAdjustment to carrying value of noncontrolling interest 663 ——\\nNumerator for basic earnings per share from continuing operations1(7,883) 22,084 (3,185)\\nLoss from discontinued operations, net of tax (181) (2,297) (2,299)\\nLoss from discontinued operations attributable to noncontrolling interests — 87 115\\nLoss from discontinued operations attributable to common stock (181) (2,210) (2,184)\\nNumerator for basic earnings per share1$ (8,064) $ 19,874 $ (5,369)\\nDilutive potential common shares:\\nMobility preferred interests2526 560 560\\nShare-based payment217 22 23\\nNumerator for diluted earnings per share $ (7,521) $ 20,456 $ (4,786)\\nDenominators (000,000)Denominator for basic earnings per share:\\nWeighted average number of common shares outstanding 7,166 7,168 7,157\\nDilutive potential common shares:\\nMobility preferred interests (in shares) 378 304 283\\nShare-based payment (in shares) 43 31 26\\nDenominator for diluted earnings per share\\n27,587 7,503 7,466\\n1For 2022, in the calculation of basic earnings per share, income (loss) attributable to common stock for continuing operations and total company has b een increased by\\n$663 from adjustment to carrying value of noncontrolling interest. (See Note 16)\\n2For 2022 and 2020, dilutive potential common shares are not included in the computation of diluted earnings per share because their effect is antidilu tive as a result of\\nthe net loss.\\nUpon the adoption of ASU 2020-06 in the first quarter of 2022, the ability to settle our Mobility preferred interests in\\nstock is reflected in our diluted earnings per share calculation, unless the effect is antidilutive. While our intent is to settlethe Mobility preferred interests in cash, the ability to settle this instrument in AT&T shares will result in additional dilutiveimpact, the magnitude of which is influenced by the fair value of the Mobility preferred interests and the average AT&Tcommon stock price during the reporting period, which could vary from period-to-period. The numerator includes anadjustment to add back to income from continuing operations the earned distributions on the Mobility preferredinterests, included in net income attributable to noncontrolling interest, and the denominator includes the potentialissuance of AT&T common stock to settle the Mobility preferred interests outstanding. (See Notes 1 and 16)\\n:.',\n", " 'NOTE 3. OTHER COMPREHENSIVE INCOME\\nChanges in the balances of each component included in accumulated OCI are presented below. All amounts are net of\\ntax and exclude noncontrolling interest.\\nForeign\\nCurrency\\nTranslation\\nAdjustmentNet Unrealized\\nGains (Losses) on\\nAvailable-for-Sale\\nSecuritiesNet Unrealized\\nGains (Losses)\\non Derivative\\nInstrumentsDefined Benefit\\nPostretirement\\nPlansAccumulated\\nOther\\nComprehensive\\nIncome\\nBalance as of December 31, 2019 $ (3,056) $ 48 $ (37) $ 8,515 $ 5,470\\nOther comprehensive income\\n(loss) before reclassifications (870) 78 (811) 2,250 647\\nAmounts reclassified from accumulated OCI —1(15)1692(1,841)3(1,787)\\nNet other comprehensive income (loss) (870) 63 (742) 409 (1,140)\\nBalance as of December 31, 2020 (3,926) 111 (779) 8,924 4,330Other comprehensive income\\n(loss) before reclassifications (125) (63) (715) (34) (937)\\nAmounts reclassified from accumulated OCI 2,087\\n1,4(3)1722(2,020)3136\\nNet other comprehensive income (loss) 1,962 (66) (643) (2,054) (801)\\nBalance as of December 31, 2021 (1,964) 45 (1,422) 6,870 3,529\\nOther comprehensive income\\n(loss) before reclassifications 346 (143) (648) 1,787 1,342\\nAmounts reclassified from accumulated OCI —181962(2,028)3(1,924)\\nDistribution of WarnerMedia (182) — (24) 25 (181)Net other comprehensive income (loss) 164 (135) (576) (216) (763)\\nBalance as of December 31, 2022 $ (1,800) $ (90) $ (1,998) $ 6,654 $ 2,766\\n1(Gains) losses are included in “Other income (expense) – net” in the consolidated statements of income.\\n2(Gains) losses are included in “Interest expense” in the consolidated statements of income (see Note 12).\\n3The amortization of prior service credits associated with postretirement benefits is included in “Other income (expense) – net” in the consolidated statements of income\\n(see Note 14).\\n4Represents unrealized foreign currency translation adjustments at Vrio that were released upon sale. (See Note 6)\\nNOTE 4. SEGMENT INFORMATION\\nOur segments are comprised of strategic business units\\nor other operations that offer products and services todifferent customer segments over various technologyplatforms and/or in different geographies that aremanaged accordingly. We have two reportable segments:Communications and Latin America.\\nWe also evaluate segment and business unit performance\\nbased on EBITDA and/or EBITDA margin, which is definedas operating income excluding depreciation andamortization. EBITDA is used as part of our managementreporting and we believe EBITDA to be a relevant anduseful measurement to our investors as it measures thecash generation potential of our business units. EBITDAdoes not give effect to depreciation and amortizationexpenses incurred in operating income nor is it burdenedby cash used for debt service requirements and thus doesnot reflect available funds for distributions, reinvestmentor other discretionary uses. EBITDA margin is EBITDAdivided by total revenue.\\nIn the first quarter of 2022, we reclassified into “Corporate”\\ncertain administrative costs borne by AT&T where thebusiness units do not influence decision making toconform with the current period presentation. This recastincreased Corporate operations and support expenses byapproximately $270 and $1,310 for full-year 2021 and 2020,\\nrespectively. Correspondingly, this recast loweredadministrative expenses for the Communicationssegment and Video (our former U.S. video operationscontributed to DIRECTV in July 2021), with no change on aconsolidated basis.\\nTheCommunications segment provides wireless and\\nwireline telecom and broadband services to consumerslocated in the U.S. and businesses globally. Our businessstrategies reflect bundled product offerings that cutacross product lines and utilize shared assets. Thissegment contains the following business units:\\n•Mobility provides nationwide wireless service and\\nequipment.\\n•Business Wireline provides advanced ethernet-based\\nfiber services, IP Voice and managed professionalservices, as well as traditional voice and data servicesand related equipment to business customers.\\n•Consumer Wireline provides broadband services,\\nincluding fiber connections that provide our multi-gigservices to residential customers in select locations.Consumer Wireline also provides legacy telephonyvoice communication services.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n::',\n", " 'TheLatin America segment provides wireless services\\nand equipment in Mexico.\\nCorporate andOther reconciles our segment results to\\nconsolidated operating income and income beforeincome taxes.\\nCorporate includes:\\n•DTV-related retained costs , which are costs previously\\nallocated to the Video business that were retainedafter the transaction, net of reimbursements fromDIRECTV under transition service agreements.\\n•Parent administration support , which includes costs\\nborne by AT&T where the business units do notinfluence decision making.\\n•Securitization fees associated with our sales of\\nreceivables (see Note 17).\\n•Value portfolio , which are businesses no longer\\nintegral to our operations or which we no longeractively market.\\nOther items consist of:\\n•Video, which includes our former U.S. video operations\\nthat were contributed to DIRECTV on July 31, 2021, andour share of DIRECTV’s earnings as equity in netincome of affiliates (see Note 19).•Held-for-sale and other reclassifications, which\\nincludes our former Crunchyroll, GovernmentSolutions and wireless and wireline operations inPuerto Rico and the U.S. Virgin Islands .\\n•Reclassification of prior service credits, which includes\\nthe reclassification of prior service creditamortization, where we present the impact of benefitplan amendments in our business unit results. Priorservice credit amortization is presented in “Otherincome (expense) – net” in the consolidatedstatements of income and therefore has no impact onconsolidated operating income or EBITDA.\\n•Certain significant items , which includes items\\nassociated with the merger and integration ofacquired or divested businesses, includingamortization of intangible assets, employeeseparation charges associated with voluntary and/orstrategic offers, asset impairments andabandonments and restructuring, and other items forwhich the segments are not being evaluated.\\n• Eliminations and consolidations , removed transactions\\ninvolving dealings between Mobility and our Videobusiness, prior to the July 31, 2021 separation of Video.\\n“Interest expense” and “Other income (expense) – net” are\\nmanaged only on a total company basis and are,accordingly, reflected only in consolidated results.\\nFor the year ended December 31, 2022\\nRevenuesOperations\\nand Support\\nExpenses EBITDADepreciation\\nand\\nAmortizationOperating\\nIncome\\n(Loss)\\nCommunications\\nMobility $ 81,780 $ 49,054 $ 32,726 $ 8,198 $ 24,528\\nBusiness Wireline 22,538 13,972 8,566 5,314 3,252\\nConsumer Wireline 12,749 8,253 4,496 3,169 1,327\\nTotal Communications 117,067 71,279 45,788 16,681 29,107\\nLatin America - Mexico 3,144 2,812 332 658 (326)Segment Total 120,211 74,091 46,120 17,339 28,781\\nCorporate and Other\\nCorporate:\\nDTV-related retained costs 8 737 (729) 549 (1,278)\\nParent administration support (32) 1,199 (1,231) 16 (1,247)\\nSecuritization fees 65 419 (354) — (354)\\nValue portfolio 489 139 350 41 309\\nTotal Corporate 530 2,494 (1,964) 606 (2,570)\\nReclassification of prior service credits — 2,691 (2,691) — (2,691)\\nCertain significant items — 28,031 (28,031) 76 (28,107)\\nTotal Corporate and Other 530 33,216 (32,686) 682 (33,368)\\nAT&T Inc. $ 120,741 $ 107,307 $ 13,434 $ 18,021 $ (4,587)\\n:,',\n", " 'For the year ended December 31, 2021\\nRevenuesOperations\\nand Support\\nExpenses EBITDADepreciation\\nand\\nAmortizationOperating\\nIncome\\n(Loss)\\nCommunications\\nMobility $ 78,254 $ 46,762 $ 31,492 $ 8,122 $ 23,370Business Wireline 23,937 14,718 9,219 5,192 4,027Consumer Wireline 12,539 8,448 4,091 3,095 996\\nTotal Communications 114,730 69,928 44,802 16,409 28,393Latin America - Mexico 2,747 2,652 95 605 (510)\\nSegment Total 117,477 72,580 44,897 17,014 27,883Corporate and Other\\nCorporate:\\nDTV-related retained costs 49 243 (194) 236 (430)Parent administration support (18) 1,523 (1,541) 36 (1,577)Securitization fees 61 89 (28) — (28)Value portfolio 639 208 431 40 391\\nTotal Corporate 731 2,063 (1,332) 312 (1,644)Video 15,513 12,666 2,847 356 2,491Held-for-sale and other reclassifications 453 310 143 — 143Reclassification of prior service credits — 2,680 (2,680) — (2,680)Certain significant items — 126 (126) 170 (296)Eliminations and consolidations (136) (136) — — —\\nTotal Corporate and Other 16,561 17,709 (1,148) 838 (1,986)AT&T Inc. $ 134,038 $ 90,289 $ 43,749 $ 17,852 $ 25,897\\nFor the year ended December 31, 2020\\nRevenuesOperations\\nand Support\\nExpenses EBITDADepreciation\\nand\\nAmortizationOperating\\nIncome\\n(Loss)\\nCommunications\\nMobility $ 72,564 $ 41,677 $ 30,887 $ 8,086 $ 22,801Business Wireline 25,083 15,068 10,015 5,216 4,799Consumer Wireline 12,318 7,942 4,376 2,914 1,462\\nTotal Communications 109,965 64,687 45,278 16,216 29,062Latin America - Mexico 2,562 2,636 (74) 513 (587)\\nSegment Total 112,527 67,323 45,204 16,729 28,475Corporate and Other\\nCorporate:\\nParent administration support (62) 1,681 (1,743) 12 (1,755)Securitization fees 53 72 (19) — (19)Value portfolio 775 335 440 64 376\\nTotal Corporate 766 2,088 (1,322) 76 (1,398)Video 28,610 24,174 4,436 2,262 2,174Held-for-sale and other reclassifications 1,414 718 696 15 681Reclassification of prior service credits — 2,442 (2,442) — (2,442)Certain significant items — 15,677 (15,677) 3,441 (19,118)Eliminations and consolidations (267) (267) — — —\\nTotal Corporate and Other 30,523 44,832 (14,309) 5,794 (20,103)AT&T Inc. $ 143,050 $ 112,155 $ 30,895 $ 22,523 $ 8,372Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n:;',\n", " 'The following table is a reconciliation of operating income (loss) to “Income (Loss) from Continuing Operations Before\\nIncome Taxes” reported in our consolidated statements of income:\\n2022 2021 2020\\nCommunications $ 29,107 $ 28,393 $ 29,062\\nLatin America (326) (510) (587)\\nSegment Operating Income 28,781 27,883 28,475\\nReconciling Items:\\nCorporate (2,570) (1,644) (1,398)\\nVideo — 2,491 2,174\\nHeld-for-sale and other reclassifications — 143 681\\nTransaction and other costs (425) (41) (1,064)\\nAmortization of intangibles acquired (76) (170) (3,427)\\nAsset impairments and abandonments and restructuring (27,498) (213) (15,687)\\nGain on spectrum transaction1— — 900\\nBenefit-related gains (losses) (108) 128 160\\nReclassification of prior service credits (2,691) (2,680) (2,442)\\nAT&T Operating Income (Loss) (4,587) 25,897 8,372\\nInterest Expense 6,108 6,716 7,727\\nEquity in net income of affiliates 1,791 603 89\\nOther income (expense) – net 5,810 9,387 (1,088)\\nIncome (Loss) from Continuing Operations Before Income Taxes $ (3,094) $ 29,171 $ (354)\\n1Included as a reduction of “Selling, general and administrative” expense in the consolidated statements of income.\\nThe following table sets forth revenues earned from customers, and property, plant and equipment located in different\\ngeographic areas:\\n2022 2021 2020\\nRevenuesNet Property,\\nPlant & Equipment RevenuesNet Property,\\nPlant & Equipment RevenuesNet Property,\\nPlant & Equipment\\nUnited States $ 116,006 $ 123,305 $ 129,157 $ 117,690 $ 138,188 $ 116,926\\nMexico 3,210 3,718 2,824 3,460 2,651 3,528\\nAsia/Pacific Rim 592 124 747 136 816 170\\nEurope 584 201 907 249 1,022 347\\nLatin America 217 74 251 82 212 94\\nOther 132 23 152 32 161 39\\nTotal $ 120,741 $ 127,445 $ 134,038 $ 121,649 $ 143,050 $ 121,104\\nThe following table presents assets, investments in equity affiliates and capital expenditures by segment:\\nAt or for the years ended December 31, 2022 2021\\nAssetsInvestments in\\nEquity Method\\nInvesteesCapital\\nExpenditures AssetsInvestments in\\nEquity Method\\nInvesteesCapital\\nExpenditures\\nCommunications $ 471,444 $ — $ 18,962 $ 448,757 $ — $ 14,691\\nLatin America 8,408 — 360 8,874 — 319\\nCorporate and eliminations1(76,999) 3,533 304 93,991 6,168 535\\nTotal $ 402,853 $ 3,533 $ 19,626 $ 551,622 $ 6,168 $ 15,545\\n1Includes $119,776 of assets from discontinued operations at December 31, 2021.\\n:?',\n", " 'NOTE 5. REVENUE RECOGNITION\\nWe report our revenues net of sales taxes and record\\ncertain regulatory fees, primarily Universal Service Fund(USF) fees, on a net basis. No customer accounted formore than 10% of consolidated revenues in 2022, 2021 or2020.\\nWireless, Advanced Data, Legacy Voice & Data Services and\\nEquipment Revenue\\nWe offer service-only contracts and contracts that bundle\\nequipment used to access the services and/or with otherservice offerings. Some contracts have fixed terms andothers are cancellable on a short-term basis (i.e., month-to-month arrangements).\\nExamples of service revenues include wireless, strategic\\nservices (e.g., virtual private network service), and legacyvoice and data (e.g., traditional local and long-distance).These services represent a series of distinct services thatis considered a separate performance obligation. Servicerevenue is recognized when services are provided, basedupon either usage (e.g., minutes of traffic/bytes of dataprocessed) or period of time (e.g., monthly service fees).\\nSome of our services require customer premises\\nequipment that, when combined and integrated withAT&T’s specific network infrastructure, facilitates thedelivery of service to the customer. In evaluating whetherthe equipment is a separate performance obligation, weconsider the customer’s ability to benefit from theequipment on its own or together with other readilyavailable resources and if so, whether the service andequipment are separately identifiable (i.e., is the servicehighly dependent on, or highly interrelated with theequipment). When equipment is a separate performanceobligation, we record the sale of equipment when title haspassed and the products are accepted by the customer.For devices sold through indirect channels (e.g., nationaldealers), revenue is recognized when the dealer acceptsthe device, not upon activation.\\nOur equipment and service revenues are predominantly\\nrecognized on a gross basis, as most of our services donot involve a third party and we typically control theequipment that is sold to our customers.\\nRevenue recognized from fixed term contracts that\\nbundle services and/or equipment is allocated based onthe standalone selling price of all required performanceobligations of the contract (i.e., each item included in thebundle). Promotional discounts are attributed to eachrequired component of the arrangement, resulting inrecognition over the contract term. Standalone selling\\nprices are determined by assessing prices paid for service-only contracts (e.g., arrangements where customers bringtheir own devices) and standalone device pricing.\\nWe offer the majority of our customers the option to\\npurchase certain wireless devices in installments over aspecified period of time, and, in many cases, they may beeligible to trade in the original equipment for a new deviceand have the remaining unpaid balance paid or settled. Forcustomers that elect these equipment installmentpayment programs, at the point of sale, we recognizerevenue for the entire amount of revenue allocated to thecustomer receivable net of fair value of the trade-in rightguarantee. The difference between the revenuerecognized and the consideration received is recorded asa note receivable when the devices are not discountedand our right to consideration is unconditional. Wheninstallment sales include promotional discounts (e.g., “buyone get one free” or equipment discounts with trade-in ofa device), the difference between revenue recognized andconsideration received is recorded as a contract asset tobe amortized over the contract term.\\nLess commonly, we offer certain customers highly\\ndiscounted devices when they enter into a minimumservice agreement term. For these contracts, werecognize equipment revenue at the point of sale basedon a standalone selling price allocation. The differencebetween the revenue recognized and the cash received isrecorded as a contract asset that will amortize over thecontract term.\\nOur contracts allow for customers to frequently modify\\ntheir arrangement, without incurring penalties in manycases. When a contract is modified, we evaluate thechange in scope or price of the contract to determine ifthe modification should be treated as a new contract or ifit should be considered a change of the existing contract.We generally do not have significant impacts fromcontract modifications.\\nRevenues from transactions between us and our\\ncustomers are recorded net of revenue-based regulatoryfees and taxes. Cash incentives given to customers arerecorded as a reduction of revenue. Nonrefundable,upfront service activation and setup fees associated withservice arrangements are deferred and recognized overthe associated service contract period or customerrelationship life.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n:!',\n", " 'Revenue Categories\\nThe following tables set forth reported revenue by category and by business unit :\\nFor the year ended December 31, 2022\\nCommunications\\nMobilityBusiness\\nWirelineConsumer\\nWirelineLatin\\nAmericaCorporate\\n& Other Elim. Total\\nWireless service $ 60,499 $ — $ — $ 2,162 $ 13 $ — $ 62,674\\nBusiness service — 21,891 ———— 21,891\\nBroadband — — 9,669 — — — 9,669\\nLegacy voice and data — — 1,746 — 323 — 2,069\\nOther — — 1,334 — 194 — 1,528\\nTotal Service 60,499 21,891 12,749 2,162 530 — 97,831\\nEquipment 21,281 647 — 982 — — 22,910\\nTotal $ 81,780 $ 22,538 $ 12,749 $ 3,144 $ 530 $ — $ 120,741\\nFor the year ended December 31, 2021\\nCommunications\\nMobilityBusiness\\nWirelineConsumer\\nWirelineLatin\\nAmericaCorporate\\n& Other Elim. Total\\nWireless service $ 57,590 $ — $ — $ 1,834 $ 74 $ — $ 59,498\\nVideo service ———— 1 5 , 4 2 3— 15,423\\nBusiness service — 23,224 — — 70 — 23,294Broadband — — 9,085 — — — 9,085Legacy voice and data — — 1,977 — 429 — 2,406Other — — 1,384 — 611 (136) 1,859\\nTotal Service 57,590 23,224 12,446 1,834 16,607 (136) 111,565\\nEquipment 20,664 713 93 913 90 — 22,473Total $ 78,254 $ 23,937 $ 12,539 $ 2,747 $ 16,697 $ (136) $ 134,038\\nFor the year ended December 31, 2020\\nCommunications\\nMobilityBusiness\\nWirelineConsumer\\nWirelineLatin\\nAmericaCorporate\\n& Other Elim. Total\\nWireless service $ 55,542 $ — $ — $ 1,656 $ 528 $ — $ 57,726\\nVideo service ———— 2 8,465 — 28,465\\nBusiness service — 24,313 — — 314 — 24,627Broadband — — 8,534 — — — 8,534Legacy voice and data — — 2,213 — 554 — 2,767Other — — 1,564 — 641 (267) 1,938\\nTotal Service 55,542 24,313 12,311 1,656 30,502 (267) 124,057\\nEquipment 17,022 770 7 906 288 — 18,993Total $ 72,564 $ 25,083 $ 12,318 $ 2,562 $ 30,790 $ (267) $ 143,050\\n:¿',\n", " 'Deferred Customer Contract Acquisition and\\nFulfillment Costs\\nCosts to acquire and fulfill customer contracts, including\\ncommissions on service activations, for our Mobility,Business Wireline and Consumer Wireline services, aredeferred and amortized over the contract period orexpected customer relationship life, which typically rangesfrom three years to five years.\\nDuring the first quarter of 2022, we updated our analysis\\nof expected economic lives of customer relationships. Asof January 1, 2022, we extended the amortization periodfor deferred acquisition and fulfillment contract costswithin Mobility, Consumer Wireline and Business Wirelineto better reflect the estimated economic lives of therelationships. These changes in accounting estimatedecreased other cost of revenues approximately $395, or$0.04 per diluted share from continuing operations for theyear ended December 31, 2022.\\nThe following table presents the deferred customer\\ncontract acquisition and fulfillment costs included on ourconsolidated balance sheets at December 31:\\nConsolidated Balance Sheets 2022 2021\\nDeferred Acquisition Costs\\nPrepaid and other current\\nassets $ 2,893 $ 2,551\\nOther Assets 3,913 3,247\\nTotal deferred customer contract\\nacquisition costs $6 , 8 0 6 $5 , 7 9 8\\nDeferred Fulfillment Costs\\nPrepaid and other current\\nassets $ 2,481 $ 2,600\\nOther Assets 4,206 4,148\\nTotal deferred customer contract\\nfulfillment costs $ 6,687 $ 6,748\\nThe following table presents deferred customer contract\\nacquisition and fulfillment cost amortization included in“Other cost of revenue” for the years ended December 31:\\nConsolidated Statements of Income 2022 20211\\nDeferred acquisition cost\\namortization $ 2,935 $ 2,965\\nDeferred fulfillment cost\\namortization 2,688 4,014\\n1Includes deferred acquisition amortization of $409 and deferred fulfillment cost\\namortization of $1,162 from our separated Video business for the year endedDecember 31, 2021.\\nContract Assets and Liabilities\\nA contract asset is recorded when revenue is recognized\\nin advance of our right to bill and receive consideration.The contract asset will decrease as services are providedand billed. For example, when installment sales includepromotional discounts (e.g., “buy one get one free”) thedifference between revenue recognized andconsideration received is recorded as a contract asset to\\nbe amortized over the contract term.\\nOur contract assets primarily relate to our wireless\\nbusinesses. Promotional equipment sales where we offerhandset credits, which are allocated between equipmentand service in proportion to their standalone selling prices,when customers commit to a specified service periodresult in additional contract assets recognized. Thesecontract assets will amortize over the service contractperiod, resulting in lower future service revenue.\\nWhen consideration is received in advance of the delivery\\nof goods or services, a contract liability is recorded.Reductions in the contract liability will be recorded as wesatisfy the performance obligations.\\nThe following table presents contract assets and liabilities\\non our consolidated balance sheets at December 31:\\nConsolidated Balance Sheets 2022 2021\\nContract asset $ 5,512 $ 4,389\\nCurrent portion in “Prepaid and\\nother current assets” 2,941 2,582\\nContract liability 4,170 4,133\\nCurrent portion in “Advanced\\nbillings and customer deposits” 3,816 3,776\\nOur contract asset balance in 2022 reflects increased\\npromotional equipment sales in our wireless business. Weexpect the amortization of these promotional costs toflatten in 2023.\\nOur beginning of period contract liabilities recorded as\\ncustomer contract revenue during 2022 was $3,795.\\nRemaining Performance ObligationsRemaining performance obligations represent services we\\nare required to provide to customers under bundled ordiscounted arrangements, which are satisfied as servicesare provided over the contract term. In determining thetransaction price allocated, we do not include non-recurring charges and estimates for usage, nor do weconsider arrangements with an original expected durationof less than one year, which are primarily prepaid wirelessand residential internet agreements.\\nRemaining performance obligations associated with\\nbusiness contracts reflect recurring charges billed,adjusted to reflect estimates for sales incentives andrevenue adjustments. Performance obligations associatedwith wireless contracts are estimated using a portfolioapproach in which we review all relevant promotionalactivities, calculating the remaining performanceobligation using the average service component for theportfolio and the average device price. As of December 31,2022, the aggregate amount of the transaction priceallocated to remaining performance obligations was$35,800, of which we expect to recognizeapproximately 76% by the end of 2024, with the balancerecognized thereafter.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n,\\x08',\n", " 'NOTE 6. ACQUISITIONS, DISPOSITIONS AND OTHER\\nADJUSTMENTS\\nAcquisitionsSpectrum Auctions On January 14, 2022, the Federal\\nCommunications Commission (FCC) announced that wewere the winning bidder for 1,624 3.45 GHz licenses inAuction 110. We provided the FCC an upfront deposit of$123 in the third quarter of 2021 and paid the remaining$8,956 in the first quarter of 2022, for a total of $9,079. Wefunded the purchase price using cash and short-terminvestments. We received the licenses in May 2022 andclassified the auction deposits and related capitalizedinterest as “Licenses – Net” on our December 31, 2022consolidated balance sheet.\\nIn February 2021, the FCC announced that AT&T was the\\nwinning bidder for 1,621 C-Band licenses, comprised of atotal of 80 MHz nationwide, including 40 MHz in Phase I.We provided to the FCC an upfront deposit of $550 in 2020and cash payments totaling $22,856 in the first quarter of2021, for a total of $23,406. We received the licenses in July2021 and classified the auction deposits, relatedcapitalized interest and billed relocation costs as “Licenses– Net” on our December 31, 2021 consolidated balancesheet. In December 2021, we paid $955 of IncentivePayments upon clearing of Phase I spectrum and estimatethat we will pay $2,112 upon clearing of Phase II spectrum,expected by the end of 2023. Additionally, we areresponsible for approximately $1,100 of compensablerelocation costs over the next several years as thespectrum is being cleared by satellite operators, of whichwe paid $650 in the fourth quarter of 2021 and $98 in thethird quarter of 2022. Funding for the purchase price ofthe spectrum included a combination of cash on hand andshort-term investments, as well as short- and long-termdebt.\\nCash paid, including spectrum deposits (net of refunds),\\ncapitalized interest, and any payments for incentive andrelocation costs are included in “Acquisitions, net of cashacquired” on our consolidated statements of cash flows.Interest is capitalized until the spectrum is ready for itsintended use.\\nIn June 2020, we completed the acquisition of $2,379 of\\n37/39 GHz spectrum in an FCC auction. Prior to theauction, we exchanged the 39 GHz licenses with a bookvalue of approximately $300 that were previouslyacquired through FiberTower Corporation for vouchers tobe applied against the winning bids and recorded a $900gain in the first quarter of 2020. These vouchers yielded avalue of approximately $1,200, which was applied towardour gross bids. In the second quarter of 2020, we made thefinal cash payment of $949, bringing the total cashpayment to $1,186.Dispositions\\nVideo Business On July 31, 2021, we closed our transaction\\nwith TPG to form a new company named DIRECTV, whichis jointly governed by a board with representation fromboth AT&T and TPG, with TPG having tie-breakingauthority on certain key decisions, most significantly theappointment and removal of the CEO.\\nIn connection with the transaction, we contributed our\\nU.S. Video business unit to DIRECTV for $4,250 of juniorpreferred units, an additional distribution preference of$4,200 and a 70% economic interest in common units(collectively “equity considerations”). TPG contributedapproximately $1,800 in cash to DIRECTV for $1,800 ofsenior preferred units and a 30% economic interest incommon units. See Note 10 for additional information onour accounting for our investment in DIRECTV.\\nUpon close of the transaction in the third quarter of 2021,\\nwe received approximately $7,170 in cash from DIRECTV($7,600, net of $430 cash on hand) and transferred $195 ofDIRECTV debt. Approximately $1,800 of the cash receivedis reported as cash received from financing activities inour consolidated statement of cash flows, as it relates to anote payable to DIRECTV, for which payment is tied to ouragreement to cover net losses under the remaining termof the NFL SUNDAY TICKET contract up to a cap of $2,100over the remaining period of the contract (see Note 19).The remainder of the net proceeds is reported as cashfrom investing activities. This transaction did not result ina material gain or loss.\\nIn the first quarter of 2021, we applied held-for-sale\\naccounting treatment to the assets and liabilities of theU.S. video business, and, accordingly, included the assets in“Prepaid and other current assets,” and the relatedliabilities in “Accounts payable and accrued liabilities,” onour consolidated balance sheet, up until the close of thetransaction. The held-for-sale classification also resultedin ceasing depreciation and amortization on thedesignated assets.\\nThe assets and liabilities of the Video operations,\\ntransferred to DIRECTV upon close of the transaction,were as follows:\\nCurrent assets $ 4,893\\nProperty, plant and equipment – net 2,673\\nLicenses – net 5,798\\nOther intangible assets – net 1,634\\nOther assets 1,787\\nTotal Video assets $1 6 , 7 8 5\\nCurrent liabilities $ 4,267\\nLong-term debt 206\\nOther noncurrent liabilities 343\\nTotal Video liabilities $ 4,816\\n,\\t',\n", " 'Central European Media Enterprises Ltd. (CME) On\\nOctober 13, 2020, we completed the sale of our 65.3%interest in CME, a European broadcasting company, forapproximately $1,100. This disposition did not result in amaterial gain or loss.\\nOperations in Puerto Rico On October 31, 2020, we\\ncompleted the sale of our wireless and wireline operationsin Puerto Rico and the U.S. Virgin Islands for approximately$1,950 and recorded a pre-tax loss of $82. The proceedswere used to redeem $1,950 of cumulative preferredinterests in a subsidiary that held notes secured by theproceeds of this sale.\\nDispositions Reflected as Discontinued OperationsWarnerMedia On April 8, 2022, we completed the\\nseparation and distribution of our WarnerMedia business,and merger of Spinco, an AT&T subsidiary formed to holdthe WarnerMedia business, with a subsidiary of Discovery,Inc., which was renamed Warner Bros. Discovery, Inc(WBD). Each AT&T shareholder was entitled to receive0.241917 shares of WBD common stock for each share ofAT&T common stock held as of the record date, whichrepresented approximately 71% of WBD. In connectionwith and in accordance with the terms of the Separationand Distribution Agreement (SDA), prior to thedistribution and merger, AT&T received approximately$40,400, which includes $38,800 of Spinco cash and $1,600of debt retained by WarnerMedia. During the secondquarter of 2022, assets of approximately $121,100 andliabilities of $70,600 were removed from our balancesheet as well as $45,041 of retained earnings and $5,632 ofadditional paid-in capital associated with the transaction.Additionally, in August 2022, we and WBD finalized thepost-closing adjustment, pursuant to Section 1.3 of theSDA, which resulted in a $1,200 payment to WBD in thethird quarter of 2022 and was reflected in the balancesheet as an adjustment to additional paid-in capital. (SeeNote 23)\\nAT&T, Spinco and Discovery entered into a Tax Matters\\nAgreement, which governs the parties’ rights,responsibilities and obligations with respect to taxliabilities and benefits, the preservation of the expectedtax-free status of the transactions contemplated by theSDA, and other matters regarding taxes.\\nXandr On June 6, 2022, we completed the sale of the\\nmarketplace component of Xandr to MicrosoftCorporation. Xandr was reflected in our historical financialstatements as discontinued operations.\\nVrio On November 15, 2021, we completed the sale of our\\nLatin America video operations, Vrio, to Grupo Wertheinand recorded a note receivable of $610 to be paid overfour years, of which $300 is in the form of seller financingand the remainder is related to working capitaladjustments. In the second quarter of 2021, we classifiedthe Vrio disposal group as held-for-sale and reported thedisposal group at fair value less cost to sell, which resultedin a noncash, pre-tax impairment charge of $4,555,\\nincluding approximately $2,100 related to accumulatedforeign currency translation adjustments and $2,500related to property, plant and equipment and intangibleassets. Approximately $80 of the impairment wasattributable to noncontrolling interest. The assets andliabilities removed from our consolidated balance sheetincluded $851 of Vrio held-for-sale assets primarily relatedto deferred customer contract acquisition and fulfillmentcosts, prepaids and other deferred charges, and $2,872 ofrelated liabilities primarily for reserves associated withaccumulated foreign currency translation adjustments,which reversed against accumulated othercomprehensive income upon close of the transaction. Thisdisposition did not result in a net material gain or loss.\\nOtter Media During the third quarter of 2021, we disposed\\nof substantially all of the assets of Otter Media. Wereceived approximately $1,540 in cash and removedapproximately $1,200 of goodwill associated with theseassets. The dispositions did not result in a material gain orloss.\\nPlaydemic Ltd. On September 20, 2021, we sold\\nWarnerMedia’s mobile games app studio, Playdemic forapproximately $1,370 in cash and recognized a pre-taxgain of $706 in “Other income (expense) – net,” on ourconsolidated statement of income. Approximately $600of goodwill was removed related to this business.\\nNOTE 7. PROPERTY, PLANT AND EQUIPMENT\\nProperty, plant and equipment is summarized as follows\\nat December 31:\\nLives\\n(years) 2022 2021\\nLand – $ 1,381 $ 1,401\\nBuildings and improvements 2-44 38,751 38,204\\nCentral office equipment13-10 98,468 97,070\\nCable, wiring and conduit 15-50 84,447 79,961\\nSatellites 14-17 103 103\\nOther equipment 3-20 81,658 85,929\\nSoftware 3-7 17,640 16,520\\nUnder construction – 7,182 5,425\\n329,630 324,613\\nAccumulated depreciation\\nand amortization 202,185 202,964\\nProperty, plant\\nand equipment – net $127,445 $ 121,649\\n1Includes certain network software.\\nOur depreciation expense was $17,852 in 2022, $17,634 in\\n2021, and $19,028 in 2020. Depreciation expense includedamortization of software totaling $2,972 in 2022, $2,909 in2021 and $3,343 in 2020.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n, ',\n", " 'In December 2022, we recorded a noncash pre-tax charge\\nof $1,413 to abandon conduits that will not be utilized tosupport future network activity. The abandonment wasconsidered outside the ordinary course of business.\\nDuring the first quarter of 2022, we updated our analysis\\nof economic lives of AT&T owned fiber network assets. Asof January 1, 2022, we extended the estimated economiclife and depreciation period of such costs to better reflectthe physical life of the assets that we had beenexperiencing and absence of technological changes thatwould replace fiber as the best broadband technology inthe industry. The change in accounting estimatedecreased depreciation expense $280, or $0.03 per dilutedshare from continuing operations for the year endedDecember 31, 2022.\\nIn December 2020, we reassessed our grouping of long-\\nlived assets and identified certain impairment indicators,requiring us to evaluate the recoverability of the long-lived assets of our former Video business. Based on thisevaluation, we determined that these assets were notfully recoverable and recognized pre-tax impairmentcharges totaling $7,255, of which $1,681 related toproperty, plant and equipment, including satellites. Thereduced carrying amounts of the impaired assets becametheir new cost basis.\\nNOTE 8. LEASES\\nWe have operating and finance leases for certain facilities\\nand equipment used in our operations. Our leasesgenerally have remaining lease terms of up to 15 years.Some of our real estate operating leases contain renewaloptions that may be exercised, and some of our leasesinclude options to terminate the leases within one year.\\nWe have recognized a right-of-use asset for both\\noperating and finance leases, and a corresponding leaseliability that represents the present value of our obligationto make payments over the lease term. The present valueof the lease payments is calculated using the incrementalborrowing rate for operating and finance leases, whichwas determined using a portfolio approach based on therate of interest that we would have to pay to borrow anamount equal to the lease payments on a collateralizedbasis over a similar term. We use the unsecured borrowingrate and risk-adjust that rate to approximate acollateralized rate in the currency of the lease, which willbe updated on a quarterly basis for measurement of newlease liabilities.\\nThe components of lease expense were as follows:\\n2022 2021 2020\\nOperating lease cost $ 5,437 $ 5,363 $ 5,331\\nFinance lease cost:\\nAmortization of\\nright-of-use assets $ 204 $ 179 $ 185\\nInterest on lease obligation 159 145 133\\nTotal finance lease cost $ 363 $ 324 $ 318The following table provides supplemental cash flows\\ninformation related to leases:\\n2022 2021 2020\\nCash Flows from Operating\\nActivities\\nCash paid for amounts\\nincluded in lease obligations:\\nOperating cash flows from\\noperating leases $ 4,679 $ 4,580 $ 4,496\\nSupplemental Lease Cash\\nFlow Disclosures\\nOperating lease right-of-use\\nassets obtained in exchange fornew operating lease obligations 3,751 3,396 4,057\\nThe following tables set forth supplemental balance sheet\\ninformation related to leases at December 31:\\n2022 2021\\nOperating Leases\\nOperating lease right-of-use assets $ 21,814 $ 21,824\\nAccounts payable and\\naccrued liabilities $ 3,547 $ 3,393\\nOperating lease obligation 18,659 18,956\\nTotal operating lease obligation $ 22,206 $ 22,349\\nFinance Leases\\nProperty, plant and equipment, at cost $ 2,770 $ 2,494\\nAccumulated depreciation\\nand amortization (1,224) (1,053)\\nProperty, plant and equipment – net $ 1,546 $ 1,441\\nCurrent portion of long-term debt $1 7 0 $ 127\\nLong-term debt 1,647 1,442\\nTotal finance lease obligation $ 1,817 $ 1,569\\n2022 2021\\nWeighted-Average Remaining Lease\\nTerm (years)\\nOperating leases 8.1 8.2\\nFinance leases 7.9 8.9\\nWeighted-Average Discount Rate\\nOperating leases 3.7 % 3.7 %\\nFinance leases 8.0 % 8.2 %\\n,.',\n", " 'The following table provides the expected future\\nminimum maturities of lease obligations:\\nAt December 31, 2022Operating\\nLeasesFinance\\nLeases\\n2023 $ 4,657 $ 315\\n2024 4,203 306\\n2025 3,543 315\\n2026 2,830 291\\n2027 2,302 290\\nThereafter 8,933 1,032\\nTotal lease payments 26,468 2,549\\nLess: imputed interest (4,262) (732)\\nTotal $ 22,206 $ 1,817\\nNOTE 9. GOODWILL AND OTHER INTANGIBLE ASSETS\\nWe test goodwill for impairment at a reporting unit level,\\nwhich is deemed to be our principal operating segmentsor one level below. With our annual impairment testing asof October 1, 2022, the calculated fair value of the Mobilityreporting unit exceeded its book value; we recordednoncash impairment charges of $13,478 in our BusinessWireline reporting unit, $10,508 in our Consumer Wirelinereporting unit and $826 in our Mexico reporting unit. The\\ndecline in fair values was primarily due to changes in themacroeconomic environment, namely increasedweighted-average cost of capital. Also, inflation pressureand lower projected cash flows driven by secular declines,predominantly at Business Wireline, impacted the fairvalues. A combination of discounted cash flow and marketmultiple approaches was used to determine the fairvalues. In the Communications segment, if all otherassumptions were to remain unchanged, we expect theimpairment charge would increase by approximately$3,400 if the weighted average cost of capital increasedby 25 basis points, or $2,100 if the projected terminalgrowth rate declined by 25 basis points, or $2,800 if theprojected long-term EBITDA margin declined 100 basispoints.\\nChanges to our goodwill in 2022 primarily resulted from\\nnoncash impairments. Changes to our goodwill in 2021primarily resulted from the sale of our GovernmentSolutions business.\\nAt December 31, 2022, our Communications segment has\\nthree reporting units: Mobility, Business Wireline andConsumer Wireline. The reporting unit is deemed to be theoperating segment for Latin America.\\nThe following table sets forth the changes in the carrying amounts of goodwill by operating segment:\\n2022 2021\\nBalance at\\nJan. 1 ImpairmentsDispositions,\\ncurrency\\nexchange\\nand otherBalance at\\nDec. 31Balance at\\nJan. 1Dispositions,\\ncurrency\\nexchange\\nand otherBalance at\\nDec. 31\\nCommunications\\nGoodwill $ 91,924 $ — $ (43) $ 91,881 $ 91,976 $ (52) $ 91,924\\nImpairments — (23,986) — (23,986) ———\\nNet goodwill 91,924 (23,986) (43) 67,895 91,976 (52) 91,924\\nLatin America 816 (826) 10 — 836 (20) 816\\nTotal $ 92,740 $ (24,812) $ (33) $ 67,895 $ 92,812 $ (72) $ 92,740\\nWe review amortizing intangible assets for impairment whenever events or circumstances indicate that the carrying\\namount may not be recoverable over the remaining life of the asset or asset group.\\nIndefinite-lived wireless licenses increased in 2022 primarily due to recent auction activity and $1,120 of capitalized\\ninterest (see Note 6).\\nIn 2021, as a result of the separation of our U.S. video business (see Note 6), we removed $5,798 of orbital slot licenses and\\n$1,585 of customer lists that were transferred to DIRECTV. Indefinite-lived wireless licenses increased in 2021 primarilydue to auction activity, compensable relocation and incentive payments, and capitalized interest (see Notes 6 and 22).Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n,:',\n", " 'Our other intangible assets at December 31 are summarized as follows:\\n2022 2021\\nOther Intangible AssetsWeighted-\\nAverage LifeGross\\nCarrying\\nAmountAccumulated\\nAmortizationCurrency\\nTranslation\\nAdjustmentGross\\nCarrying\\nAmountAccumulated\\nAmortizationCurrency\\nTranslation\\nAdjustment\\nAmortized intangible assets:\\nWireless licenses 21.6 years $ 3,045 $ 425 $ (297) $ 3,083 $ 307 $ (440)\\nTrademarks and trade names 15.0 years 26 11 (6) 27 11 (7)\\nCustomer lists and relationships 12.6 years 413 304 (75) 577 429 (98)\\nOther 8.5 years 304 234 — 349 258 —\\nTotal 21.1 years $ 3,788 $ 974 $ (378) $ 4,036 $ 1,005 $ (545)\\nIndefinite-lived intangible assets not subject to amortization:\\nWireless licenses $ 121,769 $ 111,494\\nTrade names 5,241 5,241\\nTotal $ 127,010 $ 116,735\\nAmortized intangible assets are definite-life assets, and, as such, we record amortization expense based on a method\\nthat most appropriately reflects our expected cash flows from these assets. Amortization expense for definite-lifeintangible assets was $169 for the year ended December 31, 2022, $218 for the year ended December 31, 2021 (reflectingthe separation of our U.S. video business) and $3,495 for the year ended December 31, 2020. Estimated amortizationexpense for the next five years is: $161 for 2023, $154 for 2024, $142 for 2025, $142 for 2026 and $142 for 2027.\\nNOTE 10. EQUITY METHOD INVESTMENTS\\nInvestments in partnerships, joint ventures and less than\\nmajority-owned subsidiaries in which we have significantinfluence are accounted for under the equity method.\\nOn July 31, 2021, we closed our transaction with TPG to\\nform a new company named DIRECTV (see Note 6). Thetransaction resulted in our deconsolidation of the Videobusiness, with DIRECTV being accounted for under theequity method beginning August 1, 2021.\\nOur investments in equity affiliates at December 31, 2022\\nprimarily included our interests in DIRECTV and SKYMexico.\\nDIRECTV We account for our investment in DIRECTV\\nunder the equity method of accounting. DIRECTV isconsidered a variable interest entity for accountingpurposes. As DIRECTV is jointly governed by a board withrepresentation from both AT&T and TPG, with TPG havingtie-breaking authority on certain key decisions, mostsignificantly the appointment and removal of the CEO, wehave concluded that we are not the primary beneficiary ofDIRECTV.The ownership interests in DIRECTV, based on seniority\\nare as follows:\\n• Preferred units with distribution rights of $1,800 held\\nby TPG, which were fully distributed in 2021.\\n• Junior preferred units with distribution rights of\\n$4,250 held by AT&T, of which $702 of distributionrights remain as of December 31, 2022.\\n• Distribution preference associated with Common\\nunits of $4,200 held by AT&T.\\n• Common units, with 70% held by AT&T and 30% held\\nby TPG.\\nThe initial fair value of the equity considerations on July 31,\\n2021 was $6,852, which was determined using adiscounted cash flow model reflecting distribution rightsand preference of the individual instruments. During 2022and 2021, we recognized $1,808 and $619 of equity in netincome of affiliates and received total distributions of$4,457 and $1,942, respectively, from DIRECTV. The bookvalue of our investment in DIRECTV was $2,911 and $5,539at December 31, 2022 and 2021.\\n,,',\n", " 'Our share of net income or loss may differ from the\\nstated ownership percentage interest of DIRECTV as theterms of the arrangement prescribe substantive non-proportionate cash distributions, both from operationsand in liquidation, that are based on classes of interestsheld by investors. In the event that DIRECTV records aloss, that loss will be allocated to ownership interestsbased on their seniority, beginning with the mostsubordinated interests.\\nSKY Mexico We hold a 41.3% interest in SKY Mexico, which\\nis a leading pay-TV provider in Mexico.\\nThe following table presents summarized financial\\ninformation for DIRECTV and our other equity methodinvestments, consisting primarily of SKY Mexico andcertain sports-related programming investments, atDecember 31, or for the year then ended:\\n2022 2021 2020\\nIncome Statements1\\nOperating revenues $2 5 , 7 9 4 $ 12,220 $ 1,282\\nOperating income 3,175 1,179 157\\nNet income 2,581 938 91\\nBalance Sheets\\nCurrent assets 4,240 5,295\\nNoncurrent assets 14,211 17,022\\nCurrent liabilities 6,681 7,191\\nNoncurrent liabilities 7,951 8,614\\n1Does not include DIRECTV for periods prior to August 1, 2021.\\nThe following table is a reconciliation of our investments\\nin equity affiliates as presented on our consolidatedbalance sheets:\\n2022 2021\\nBeginning of year $ 6,168 $ 742\\nAdditional investments 3 —\\nReceipt of equity interest in DIRECTV — 6,852\\nDistributions from DIRECTV in excess\\nof cumulative equity in earnings (2,649) (1,323)\\nOther capital distributions — (6)\\nDividends and distributions of\\ncumulative earnings received (1,815) (701)\\nEquity in net income of affiliates 1,791 603\\nCurrency translation adjustments 25 (14)\\nOther adjustments 10 15\\nEnd of year $3 , 5 3 3 $ 6,168NOTE 11. DEBT\\nLong-term debt of AT&T and its subsidiaries, including\\ninterest rates and maturities, is summarized as follows atDecember 31:\\n2022 2021\\nNotes and debentures\\nInterest Rates1Maturities\\n0.00% – 2.99% 2022 – 2039 $ 24,603 $ 31,612\\n3.00% – 4.99% 2022 – 2061 91,201 107,635\\n5.00% – 6.99% 2022 – 2095 20,083 23,023\\n7.00% – 12.00% 2022 – 2097 4,884 5,056\\nCredit agreement borrowings 2,500 10,400\\nFair value of interest rate swaps\\nrecorded in debt 13 16\\n143,284 177,742\\nUnamortized (discount) premium – net (9,650) (9,758)\\nUnamortized issuance costs (427) (508)\\nTotal notes and debentures 133,207 167,476\\nFinance lease obligations 1,817 1,569\\nTotal long-term debt, including\\ncurrent maturities 135,024 169,045\\nCurrent maturities of long-term debt (6,601) (7,934)\\nCurrent maturities of credit\\nagreement borrowings — (10,100)\\nTotal long-term debt $ 128,423 $ 151,011\\n1Foreign debt includes the impact from hedges, when applicable.\\nWe had outstanding Euro, British pound sterling, Canadian\\ndollar, Mexican peso, Australian dollar, and Swiss francdenominated debt of approximately $35,525 and $41,063at December 31, 2022 and 2021, respectively.\\nThe weighted-average interest rate of our long-term debt\\nportfolio, including credit agreement borrowings and theimpact of derivatives, was approximately 4.1% as ofDecember 31, 2022 and 3.8% as of December 31, 2021.\\nDebt maturing within one year consisted of the following\\nat December 31:\\n2022 2021\\nCurrent maturities of long-term debt $ 6,601 $7 , 9 3 4\\nCommercial paper 866 6,586\\nCredit agreement borrowings — 10,100\\nTotal $ 7,467 $ 24,620Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n,;',\n", " 'Financing Activities\\nDuring 2022, we received net proceeds of $479 on the issuance of $479 in long-term debt and proceeds of $3,250 on the\\nissuance of credit agreement borrowings in various markets, with an average weighted maturity of approximately 2.0years and a weighted average interest rate of 5.2%. We repaid $34,835 of long-term debt and credit agreementborrowings with a weighted average interest rate of 3.1%. Our debt activity during 2022 primarily consisted of thefollowing:\\nFirst\\nQuarterSecond\\nQuarterThird\\nQuarterFourth\\nQuarterFull Year\\n2022\\nNet commercial paper borrowings $ 1,471 $ (5,219) $ (724) $ (1,337) $ (5,809)\\nIssuance of Notes and Debentures:\\nPrivate Financing $ — $ — $ 750 $ — $ 7502025 Term Loan — — — 2,500 2,500Other 479 — — — 479\\nDebt Issuances $ 479 $ — $ 750 $ 2,500 $ 3,729Repayments:\\n2021 Syndicated Term Loan $ — $ (7,350) $ — $ — $ (7,350)BAML Bilateral Term Loan – Tranche A — (1,000) — — (1,000)Private financing — (750) — (750) (1,500)\\nRepayments of other short-term borrowings $ — $ (9,100) $ — $ (750) $ (9,850)\\nUSD notes\\n1,2,3$ (123) $ (18,957) $ — $ (287) $ (19,367)\\nEuro notes — (3,343) — — (3,343)BAML Bilateral Term Loan – Tranche B — (1,000) — — (1,000)Other (667) (123) (199) (419) (1,408)\\nRepayments of long-term debt $ (790) $(23,423) $ (199) $ (706) $ (25,118)\\n1On April 11, 2022, we issued notices for the redemption in full of all of the outstanding approximately $9,042 aggregate principal amount of various gl obal notes due 2022\\nto 2026 with coupon rates ranging from 2.625% to 4.450% (Make-Whole Notes). The Make-Whole Notes were redeemed on the redemption dates set forth in the notices\\nof redemption, at “make whole” redemption prices calculated as set forth in the respective redemption notices in the second quarter.\\n2Includes $7,954 of cash paid toward the $8,822 aggregate principal amount of various notes that were tendered for cash in May 2022. The notes had intere st rates\\nranging between 3.100% and 8.750% and original maturities ranging from 2026 to 2061.\\n3Includes $287 of principal repayment on a $592 zero coupon note that matured in November 2022. The other $305 was applied to operating cash flows relate dt o\\ninterest expense that accreted to the note over its life.\\nAs of December 31, 2022 and 2021, we were in compliancewith all covenants and conditions of instrumentsgoverning our debt. Substantially all of our outstandinglong-term debt is unsecured. Maturities of outstandinglong-term notes and debentures, as of December 31, 2022,and the corresponding weighted-average interest ratescheduled for repayment are as follows:\\n2023 2024 2025 2026 2027There-\\nafter\\nDebtrepayments\\n1$6,929 $8,950 $5,948 $8,619 $6,278 $110,949\\nWeighted-\\naverageinterest rate\\n23.7 % 4.1 % 5.5 % 3.1 % 3.7 % 4.2 %\\n1Debt repayments represent maturity value. Foreign debt includes the impact\\nfrom hedges, when applicable. Includes credit agreement borrowings.\\n2Includes credit agreement borrowings.Credit Facilities\\nGeneralOn January 29, 2021, we entered into a $14,700 Term Loan\\nCredit Agreement (2021 Syndicated Term Loan), with Bankof America, N.A., as agent. On March 23, 2021, we borrowed$7,350 under the 2021 Syndicated Term Loan and theremaining $7,350 of lenders’ commitments wasterminated. In the first quarter of 2022, the maturity dateof the 2021 Syndicated Term Loan was extended toDecember 31, 2022. On April 13, 2022, the 2021 SyndicatedTerm Loan was paid off and terminated.\\nIn March 2021, we entered into and drew on a $2,000 term\\nloan credit agreement (BAML Bilateral Term Loan)consisting of (i) a $1,000 facility originally due December31, 2021 (BAML Tranche A Facility) and subsequentlyextended to December 31, 2022 in the fourth quarter of2021, and (ii) a $1,000 facility due December 31, 2022 (BAMLTranche B Facility), with Bank of America, N.A., as agent.On April 13, 2022, the BAML Bilateral Term Loan was paidoff and terminated.\\n,?',\n", " 'In November 2022, we entered into and drew on a $2,500\\nterm loan agreement due February 16, 2025 (2025 TermLoan), with Mizuho Bank, Ltd., as agent. As of December 31,2022, $2,500 was outstanding under this agreement.\\nRevolving Credit AgreementsIn November 2022, we terminated one of our revolving\\ncredit agreements and amended and restated the other.We currently have one $12,000 revolving credit agreementthat terminates on November 18, 2027 (Revolving CreditAgreement). No amounts were outstanding as ofDecember 31, 2022.\\nEach of our credit and loan agreements contains\\ncovenants that are customary for an issuer with aninvestment grade senior debt credit rating. Our RevolvingCredit Agreement and 2025 Term Loan include a net debt-to-EBITDA financial ratio covenant requiring AT&T tomaintain, as of the last day of each fiscal quarter, a ratio ofnot more than 3.75-to-1. Other loan agreements include anet debt-to-EBITDA financial ratio covenant requiringAT&T to maintain, as of the last day of each fiscal quarterthrough June 30, 2023 a ratio of not more than 4.0-to-1,and a ratio of not more than 3.5-to-1 for any fiscal quarterthereafter.\\nThe events of default are customary for agreements of\\nthis type and such events would result in the accelerationof, or would permit the lenders to accelerate, asapplicable, required payments and would increase eachagreement’s relevant Applicable Margin by 2.00% perannum.\\nThe obligations of the lenders under the Revolving Credit\\nAgreement to provide advances will terminate onNovember 18, 2027, unless the commitments areterminated in whole prior to that date. All advances mustbe repaid no later than the date on which lenders are nolonger obligated to make any advances under theRevolving Credit Agreement.\\nThe Revolving Credit Agreement provides that we and\\nlenders representing more than 50% of the facilityamount may agree to extend their commitments underthe credit agreement for two one-year periods beyondthe initial termination date. We have the right toterminate, in whole or in part, amounts committed by thelenders under the credit agreement in excess of anyoutstanding advances; however, any such terminatedcommitments may not be reinstated.Advances under the Revolving Credit Agreement would\\nbear interest, at our option, either:\\n• at a variable annual rate equal to: (1) the highest of\\n(but not less than zero) (a) the rate of interestannounced publicly by Citibank in New York, NewYork, from time to time, as Citibank’s base rate, (b)0.5% per annum above the federal funds rate, and (c)the forward-looking term rate\\nbased on the secured\\novernight financing rate (“Term SOFR”) for a period ofone month plus a credit spread adjustment of 0.10%plus 1.00%, plus (2) an applicable margin, as set forthin the credit agreement (the “Applicable Margin forBase Advances”); or\\n• at a rate equal to: (i) Term SOFR for a period of one,\\nthree or six months, as applicable, plus (ii) a creditspread adjustment of 0.10% plus (iii) an applicablemargin, as set forth in the Revolving CreditAgreement (the “Applicable Margin for BenchmarkRate Advances”).\\nWe pay a facility fee of 0.060%, 0.070%, 0.080% or 0.100%\\nper annum of the amount of the lender commitments,depending on AT&T’s credit rating.\\nNOTE 12. FAIR VALUE MEASUREMENTS AND\\nDISCLOSURE\\nThe Fair Value Measurement and Disclosure framework in\\nASC 820, “Fair Value Measurement,” provides a three-tiered fair value hierarchy based on the reliability of theinputs used to determine fair value. Level 1 refers to fairvalues determined based on quoted prices in activemarkets for identical assets. Level 2 refers to fair valuesestimated using significant other observable inputs andLevel 3 includes fair values estimated using significantunobservable inputs.\\nThe level of an asset or liability within the fair value\\nhierarchy is based on the lowest level of any input that issignificant to the fair value measurement. Our valuationtechniques maximize the use of observable inputs andminimize the use of unobservable inputs.\\nThe valuation methodologies described above may\\nproduce a fair value calculation that may not be indicativeof future net realizable value or reflective of future fairvalues. We believe our valuation methods are appropriateand consistent with other market participants. The use ofdifferent methodologies or assumptions to determine thefair value of certain financial instruments could result in adifferent fair value measurement at the reporting date.There have been no changes in the methodologies usedsince December 31, 2021.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n,!',\n", " 'Long-Term Debt and Other Financial Instruments\\nThe carrying amounts and estimated fair values of our long-term debt, including current maturities, and other financial\\ninstruments, are summarized as follows:\\nDecember 31, 2022 December 31, 2021\\nCarrying\\nAmountFair\\nValueCarrying\\nAmountFair\\nValue\\nNotes and debentures1$ 133,207 $ 122,524 $ 167,476 $ 193,068\\nCommercial paper 866 866 6,586 6,586\\nInvestment securities22,692 2,692 3,214 3,214\\n1Includes credit agreement borrowings. Excludes note payable to DIRECTV.\\n2Excludes investments accounted for under the equity method.\\nThe carrying amount of debt with an original maturity of less than one year approximates fair value. The fair value\\nmeasurements used for notes and debentures are considered Level 2 and are determined using various methods,including quoted prices for identical or similar securities in both active and inactive markets.\\nFollowing is the fair value leveling for investment securities that are measured at fair value and derivatives as of\\nDecember 31, 2022 and December 31, 2021. Derivatives designated as hedging instruments are reflected as “OtherAssets,” “Other noncurrent liabilities,” “Prepaid and other current assets” and “Accounts payable and accrued liabilities” onour consolidated balance sheets.\\nDecember 31, 2022\\nLevel 1 Level 2 Level 3 Total\\nEquity Securities\\nDomestic equities $ 995 $ — $ — $ 995\\nInternational equities 198 — — 198\\nFixed income equities 189 — — 189\\nAvailable-for-Sale Debt Securities — 1,132 — 1,132\\nAsset Derivatives\\nCross-currency swaps —2 8—2 8\\nLiability Derivatives\\nCross-currency swaps — (6,010) — (6,010)\\nForeign exchange contracts — (23) — (23)\\nDecember 31, 2021\\nLevel 1 Level 2 Level 3 Total\\nEquity Securities\\nDomestic equities $ 1,213 $ — $ — $ 1,213International equities 221 — — 221Fixed income equities 219 — — 219\\nAvailable-for-Sale Debt Securities — 1,380 — 1,380Asset Derivatives\\nCross-currency swaps — 211 — 211\\nLiability Derivatives\\nCross-currency swaps — (3,170) — (3,170)\\n,¿',\n", " 'Investment Securities\\nOur investment securities include both equity and debt\\nsecurities that are measured at fair value, as well as equitysecurities without readily determinable fair values. Asubstantial portion of the fair values of our investmentsecurities is estimated based on quoted market prices.Investments in equity securities not traded on a nationalsecurities exchange are valued at cost, less anyimpairment, and adjusted for changes resulting fromobservable, orderly transactions for identical or similarsecurities. Investments in debt securities not traded on anational securities exchange are valued using pricingmodels, quoted prices of securities with similarcharacteristics or discounted cash flows.\\nThe components comprising total gains and losses in the\\nperiod on equity securities are as follows:\\nFor the years ended December 31, 2022 2021 2020\\nTotal gains (losses) recognized\\non equity securities $ (309) $ 293 $ 171\\nGains (Losses) recognized\\non equity securities sold (80) (5) (25)\\nUnrealized gains (losses)\\nrecognized on equity securitiesheld at end of period $ (229) $ 298 $ 196\\nAt December 31, 2022, available-for-sale debt securities\\ntotaling $1,132 have maturities as follows - less than oneyear: $38; one to three years: $158; three to five years:$170; five or more years: $766.\\nOur cash equivalents (money market securities), short-\\nterm investments (certificate and time deposits) andnonrefundable customer deposits are recorded atamortized cost, and the respective carrying amountsapproximate fair values. Short-term investments andnonrefundable customer deposits are recorded in“Prepaid and other current assets” and our investmentsecurities are recorded in “Other Assets” on theconsolidated balance sheets.\\nDerivative Financial Instruments\\nWe enter into derivative transactions to manage certain\\nmarket risks, primarily interest rate risk and foreigncurrency exchange risk. This includes the use of interestrate swaps, interest rate locks, foreign exchange forwardcontracts and combined interest rate foreign exchangecontracts (cross-currency swaps). We do not usederivatives for trading or speculative purposes. We recordderivatives on our consolidated balance sheets at fairvalue that is derived from observable market data,including yield curves and foreign exchange rates (all ofour derivatives are Level 2). Cash flows associated withderivative instruments are presented in the samecategory on the consolidated statements of cash flows asthe item being hedged.Fair Value Hedging Periodically, we enter into and\\ndesignate fixed-to-floating interest rate swaps as fairvalue hedges. The purpose of these swaps is to manageinterest rate risk by managing our mix of fixed-rate andfloating-rate debt. These swaps involve the receipt offixed-rate amounts for floating interest rate paymentsover the life of the swaps without exchange of theunderlying principal amount.\\nWe also designate most of our cross-currency swaps and\\nforeign exchange contracts as fair value hedges. Thepurpose of these contracts is to hedge foreign currencyrisk associated with changes in spot rates on foreigndenominated debt. For cross-currency hedges, we haveelected to exclude the change in fair value of the swaprelated to both time value and cross-currency basisspread from the assessment of hedge effectiveness. Forforeign exchange contracts, we have elected to excludethe change in fair value of forward points from theassessment of hedge effectiveness.\\nUnrealized and realized gains or losses from fair value\\nhedges impact the same category on the consolidatedstatements of income as the item being hedged, includingthe earnings impact of excluded components. In instanceswhere we have elected to exclude components from theassessment of hedge effectiveness related to fair valuehedges, unrealized gains or losses on such excludedcomponents are recorded as a component ofaccumulated OCI and recognized into earnings over thelife of the hedging instrument. Unrealized gains onderivatives designated as fair value hedges are recordedat fair value as assets, and unrealized losses are recordedat fair market value as liabilities. Except for excludedcomponents, changes in the fair value of derivativeinstruments designated as fair value hedges are offsetagainst the change in fair value of the hedged assets orliabilities through earnings. In the years endedDecember 31, 2022 and 2021, no ineffectiveness wasmeasured on fair value hedges.\\nCash Flow Hedging We designated some of our cross-\\ncurrency swaps as cash flow hedges to hedge ourexposure to variability in expected future cash flows thatare attributable to foreign currency risk generated fromour foreign-denominated debt. These agreements includeinitial and final exchanges of principal from fixed foreigncurrency denominated amounts to fixed U.S. dollardenominated amounts, to be exchanged at a specifiedrate that is usually determined by the market spot rateupon issuance. They also include an interest rate swap of afixed or floating foreign currency-denominated interestrate to a fixed U.S. dollar denominated interest rate.\\nOn September 30, 2022, we de-designated most of our\\ncross-currency swaps from cash flow hedges and re-designated these swaps as fair value hedges. The amountremaining in accumulated other comprehensive lossrelated to cash flow hedges on the de-designation datewas $1,857. The amount will be reclassified to earningsNotes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n;\\x08',\n", " 'when the hedged item is recognized in earnings or when it\\nbecomes probable that the forecasted transactions willnot occur. The election of fair value hedge designation forcross-currency swaps does not have an impact on ourfinancial results.\\nUnrealized gains on derivatives designated as cash flow\\nhedges are recorded at fair value as assets, and unrealizedlosses are recorded at fair value as liabilities. For derivativeinstruments designated as cash flow hedges, changes infair value are reported as a component of accumulatedOCI and are reclassified into the consolidated statementsof income in the same period the hedged transactionaffects earnings.\\nPeriodically, we enter into and designate interest rate\\nlocks to partially hedge the risk of changes in interestpayments attributable to increases in the benchmarkinterest rate during the period leading up to the probableissuance of fixed-rate debt. We designate our interest ratelocks as cash flow hedges. Gains and losses when wesettle our interest rate locks are amortized into incomeover the life of the related debt. Over the next 12 months,we expect to reclassify $59 from accumulated OCI to“Interest expense” due to the amortization of net losseson historical interest rate locks.\\nCollateral and Credit-Risk Contingency We have entered\\ninto agreements with our derivative counterpartiesestablishing collateral thresholds based on respectivecredit ratings and netting agreements. At December 31,2022, we had posted collateral of $886 (a deposit asset)and held collateral of $0 (a receipt liability). Under theagreements, if AT&T’s credit rating had been downgradedtwo ratings levels by Fitch Ratings, one level by S&P andone level by Moody’s, before the final collateral exchangein December, we would have been required to postadditional collateral of $42. If AT&T’s credit rating hadbeen downgraded three ratings levels by Fitch Ratings,two levels by S&P, and two levels by Moody’s, we wouldhave been required to post additional collateral of $5,728.At December 31, 2021, we had posted collateral of $135 (adeposit asset) and held collateral of $7 (a receipt liability).We do not offset the fair value of collateral, whether theright to reclaim cash collateral (a receivable) or theobligation to return cash collateral (a payable) exists,against the fair value of the derivative instruments.\\nFollowing are the notional amounts of our outstanding\\nderivative positions at December 31:\\n2022 2021\\nCross-currency swaps $ 38,213 $ 40,737\\nForeign exchange contracts 617 —\\nTotal $ 38,830 $ 40,737Following are the related hedged items affecting our\\nfinancial position and performance:\\nEffect of Derivatives on theConsolidated Statements of Income\\nFair Value Hedging RelationshipsFor the years ended December 31, 2022 2021 2020\\nInterest rate swaps\\n(Interest expense):\\nGain (Loss) on interest rate\\nswaps $( 3 ) $ (4) $ (6)\\nGain (Loss) on long-term debt 3 46\\nCross-currency swaps:\\nGain (Loss) on cross-currency\\nswaps 2,195 (91) —\\nGain (Loss) on long-term debt (2,195) 91 —\\nGain (Loss) recognized in\\naccumulated OCI 297 (17) —\\nForeign exchange contracts:\\nGain (Loss) on foreign exchange\\ncontracts (12) ——\\nGain (Loss) on long-term debt 12 ——\\nGain (Loss) recognized in\\naccumulated OCI (12) ——\\nIn addition, the net swap settlements that accrued and\\nsettled in the periods above were offset against “Interestexpense.”\\nCash Flow Hedging RelationshipsFor the years ended December 31, 2022 2021 2020\\nCross-currency swaps:\\nGain (Loss) recognized in\\naccumulated OCI $ (1,119) $ (873) $ (378)\\nForeign exchange contracts:\\nGain (Loss) recognized in\\naccumulated OCI 3 (17) 3\\nOther income (expense) –\\nnet reclassified from\\naccumulated OCI into income 1 1( 3 )\\nInterest rate locks:\\nGain (Loss) recognized in\\naccumulated OCI — — (648)\\nInterest income (expense)\\nreclassified from accumulatedOCI into income (65) (92) (84)\\nOther income (expense) –\\nnet reclassified from\\naccumulated OCI into income (45) ——\\nDistribution of WarnerMedia (12) ——\\n;\\t',\n", " 'Nonrecurring Fair Value Measurements\\nIn addition to assets and liabilities that are recorded at fair\\nvalue on a recurring basis, impairment indicators maysubject goodwill and long-lived assets to nonrecurring fairvalue measurements. The implied fair values of theBusiness Wireline, Consumer Wireline and Mexicoreporting units and the former U.S. video business wereestimated using both the discounted cash flow as well asmarket multiple approaches (see Note 9). The inputs tothese models are considered Level 3.\\nNOTE 13. INCOME TAXES\\nSignificant components of our deferred tax liabilities\\n(assets) are as follows at December 31:\\n2022 2021\\nDepreciation and amortization $ 36,570 $ 35,894\\nLicenses and nonamortizable intangibles 19,339 15,573\\nEmployee benefits (2,251) (3,178)\\nDeferred fulfillment costs 1,989 1,797\\nEquity in partnership 3,284 3,285\\nNet operating loss and other\\ncarryforwards (5,817) (6,109)\\nOther – net (343) 2,153\\nSubtotal 52,771 49,415\\nDeferred tax assets valuation allowance 4,175 4,343\\nNet deferred tax liabilities $56,946 $ 53,758\\nNoncurrent deferred tax liabilities $ 57,032 $ 53,767\\nLess: Noncurrent deferred tax assets (86) (9)\\nNet deferred tax liabilities $56,946 $ 53,758\\nAt December 31, 2022, we had combined net operating and\\ncapital loss carryforwards (tax effected) for federalincome tax purposes of $892, state of $747 and foreign of$2,441, expiring through 2042. Additionally, we had federalcredit carryforwards of $293 and state credit carry-forwards of $1,444, expiring primarily through 2042.\\nWe recognize a valuation allowance if, based on the\\nweight of available evidence, it is more likely than not thatsome portion, or all, of a deferred tax asset will not berealized. Our valuation allowances at December 31, 2022and 2021 related primarily to state and foreign netoperating losses and state credit carryforwards.\\nWe consider post-1986 unremitted foreign earnings\\nsubjected to the one-time transition tax not to beindefinitely reinvested as such earnings can be repatriatedwithout any significant incremental tax costs. We considerother types of unremitted foreign earnings to beindefinitely reinvested. U.S. income and foreignwithholding taxes have not been recorded on temporarydifferences related to investments in certain foreignsubsidiaries as such differences are consideredindefinitely reinvested. Determination of the amount ofunrecognized deferred tax liability is not practicable.We recognize the financial statement effects of a tax\\nreturn position when it is more likely than not, based onthe technical merits, that the position will ultimately besustained. For tax positions that meet this recognitionthreshold, we apply our judgment, taking into accountapplicable tax laws, our experience in managing tax auditsand relevant GAAP, to determine the amount of taxbenefits to recognize in our financial statements. For eachposition, the difference between the benefit realized onour tax return and the benefit reflected in our financialstatements is recorded on our consolidated balancesheets as an unrecognized tax benefit (UTB). We updateour UTBs at each financial statement date to reflect theimpacts of audit settlements and other resolutions ofaudit issues, the expiration of statutes of limitation,developments in tax law and ongoing discussions withtaxing authorities. A reconciliation of the change in ourUTB balance from January 1 to December 31 for 2022 and2021 is as follows:\\nFederal, State and Foreign Tax 2022 2021\\nBalance at beginning of year $ 8,954 $ 9,415\\nIncreases for tax positions\\nrelated to the current year 1,389 677\\nIncreases for tax positions\\nrelated to prior years 577 332\\nDecreases for tax positions\\nrelated to prior years (1,079) (1,169)\\nLapse of statute of limitations (2) (6)\\nSettlements (182) (295)\\nBalance at end of year 9,657 8,954\\nAccrued interest and penalties 1,930 2,054\\nGross unrecognized income tax benefits 11,587 11,008\\nLess: Deferred federal and state\\nincome tax benefits (723) (728)\\nLess: Tax attributable to timing\\nitems included above (4,640) (3,428)\\nTotal UTB that, if recognized, would\\nimpact the effective income taxrate as of the end of the year $ 6,224 $ 6,852\\nPeriodically we make deposits to taxing jurisdictions which\\nreduce our UTB balance but are not included in thereconciliation above. The amount of deposits thatreduced our UTB balance was $1,767 at December 31, 2022and $377 at December 31, 2021.\\nAccrued interest and penalties included in UTBs were\\n$1,930 as of December 31, 2022 and $2,054 as ofDecember 31, 2021. We record interest and penaltiesrelated to federal, state and foreign UTBs in income taxexpense. The net interest and penalty expense (benefit)included in income tax expense was $(86) for 2022, $129for 2021 and $127 for 2020.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n; ',\n", " 'We file income tax returns in the U.S. federal jurisdiction\\nand various state, local and foreign jurisdictions. As a largetaxpayer, our income tax returns are regularly audited bythe Internal Revenue Service (IRS) and other taxingauthorities.\\nThe IRS has completed field examinations of our tax\\nreturns through 2015. All audit periods prior to 2005 areclosed for federal examination purposes and we haveeffectively resolved all outstanding audit issues for yearsthrough 2010 with the IRS Appeals Division. Those yearswill be closed as the final paperwork is processed in thecoming months.\\nWhile we do not expect material changes, we are generally\\nunable to estimate the range of impacts on the balance ofthe remaining uncertain tax positions or the impact on theeffective tax rate from the resolution of these issues untileach year is closed; and it is possible that the amount ofunrecognized benefit with respect to our uncertain taxpositions could increase or decrease within the next 12months.\\nThe components of income tax (benefit) expense are as\\nfollows:\\n2022 2021 2020\\nFederal:\\nCurrent $5 7 9 $ (2,400) $ (346)\\nDeferred 2,206 6,872 858\\n2,785 4,472 512\\nState and local:\\nCurrent 21 289 338\\nDeferred 912 648 272\\n933 937 610\\nForeign:\\nCurrent 106 (66) 14\\nDeferred (44) 52 32\\n62 (14) 46\\nTotal $ 3,780 $ 5,395 $ 1,168\\n“Income (Loss) from Continuing Operations Before\\nIncome Taxes” in the Consolidated Statements of Incomeincluded the following components for the years endedDecember 31:\\n2022 2021 2020\\nU.S. income (loss) before\\nincome taxes $ (1,480) $ 29,678 $ 510\\nForeign income (loss)\\nbefore income taxes (1,614) (507) (864)\\nTotal $ (3,094) $ 29,171 $ (354)A reconciliation of income tax expense (benefit) on\\ncontinuing operations and the amount computed byapplying the statutory federal income tax rate of 21% toincome from continuing operations before income taxesis as follows:\\n2022 2021 2020\\nTaxes computed at federal\\nstatutory rate $ (650) $ 6,126 $ (74)\\nIncreases (decreases) in\\nincome taxes resulting from:\\nState and local income taxes –\\nnet of federal income taxbenefit 795 936 170\\nCARES Act federal NOL\\ncarryback — (471) —\\nTax on foreign investments 43 47 (124)\\nNoncontrolling interest (308) (291) (286)\\nPermanent items and R&D\\ncredit (121) (153) (195)\\nAudit resolutions (642) (220) (112)\\nDivestitures (481) (558) 107\\nGoodwill impairment\\n15,210 16 1,702\\nOther – net (66) (37) (20)\\nTotal $3 , 7 8 0 $ 5,395 $ 1,168\\nEffective Tax Rate (122.2)% 18.5 % (329.9)%\\n1Goodwill impairments are not deductible for tax purposes.\\nOn March 27, 2020, the Coronavirus Aid, Relief, and\\nEconomic Security (CARES) Act was enacted, which allowsfor a Net Operating Loss (NOL) generated in 2020 to becarried back to a year with a federal rate of 35%. During2021, we recorded a $471 tax benefit for the rate impact ofthe 2020 NOL carryback adjusted for the domesticmanufacturing deduction limitation in the carryback yearand applicable unrecognized tax benefits.\\nAT&T is subject to the Global Intangible Low Taxed\\nIncome (GILTI) provisions created under the Tax Cuts andJobs Act of 2017. We report the tax impact of GILTI as aperiod cost when incurred.\\nNOTE 14. PENSION AND POSTRETIREMENT BENEFITS\\nWe offer noncontributory pension programs covering the\\nmajority of domestic nonmanagement employees in ourCommunications business. Nonmanagement employees’pension benefits are generally calculated using one of twoformulas: a flat dollar amount applied to years of serviceaccording to job classification or a cash balance plan withnegotiated annual pension band credits as well as interestcredits. Most employees can elect to receive their pensionbenefits in either a lump sum payment or an annuity.\\n;.',\n", " 'Pension programs covering U.S. management employees\\nare closed to new entrants. These programs continue toprovide benefits to participants that were generally hiredbefore January 1, 2015, who receive benefits under eithercash balance pension programs that include annual ormonthly credits based on salary as well as interest credits,or a traditional pension formula (i.e., a stated percentageof employees’ adjusted career income).\\nWe also provide a variety of medical, dental and life\\ninsurance benefits to certain retired employees undervarious plans and accrue actuarially determinedpostretirement benefit costs as active employees earnthese benefits.\\nDuring the third quarter of 2022, we committed to, and\\nreflected in our results, plan changes impactingpostretirement health and welfare benefits. This planchange aligns our benefit plans to market level.Obligations and Funded Status\\nFor defined benefit pension plans, the benefit obligation is\\nthe projected benefit obligation, the actuarial presentvalue, as of our December 31 measurement date, of allbenefits attributed by the pension benefit formula toemployee service rendered to that date. The amount ofbenefit to be paid depends on a number of future eventsincorporated into the pension benefit formula, includingestimates of the average life of employees and theirbeneficiaries and average years of service rendered. It ismeasured based on assumptions concerning futureinterest rates and future employee compensation levelsas applicable.\\nFor postretirement benefit plans, the benefit obligation is\\nthe accumulated postretirement benefit obligation, theactuarial present value as of the measurement date of allfuture benefits attributed under the terms of thepostretirement benefit plans to employee service.\\nThe following table presents the change in the projected benefit obligation for the years ended December 31:\\nPension Benefits Postretirement Benefits\\n2022 2021 2022 2021\\nBenefit obligation at beginning of year $ 57,212 $ 62,158 $ 12,552 $ 13,928\\nService cost - benefits earned during the period 617 957 32 45\\nInterest cost on projected benefit obligation 1,747 1,276 277 210\\nAmendments — — (2,370) —\\nActuarial (gain) loss (10,894) (1,237) (1,919) (275)\\nBenefits paid, including settlements (5,854) (5,942) (1,292) (1,356)\\nBenefit obligation at end of year $ 42,828 $ 57,212 $ 7,280 $ 12,552\\nThe following table presents the change in the fair value of plan assets for the years ended December 31 and the plans’\\nfunded status at December 31:\\nPension Benefits Postretirement Benefits\\n2022 2021 2022 2021\\nFair value of plan assets at beginning of year $ 54,401 $ 54,606 $ 3,198 $ 3,843\\nActual return on plan assets (7,673) 5,737 (370) 210\\nBenefits paid, including settlements1(5,854) (5,942) (788) (1,163)\\nContributions — — 120 308\\nFair value of plan assets at end of year 40,874 54,401 2,160 3,198\\nUnfunded status at end of year2$ (1,954) $ (2,811) $ (5,120) $ (9,354)\\n1At our discretion, certain postretirement benefits may be paid from our cash accounts, which does not reduce Voluntary Employee Benefit Association (VEBA) assets.\\nFuture benefit payments may be made from VEBA trusts and thus reduce those asset balances.\\n2Funded status is not indicative of our ability to pay ongoing pension benefits or of our obligation to fund retirement trusts. Required pension fundin g is determined in\\naccordance with the Employee Retirement Income Security Act of 1974, as amended (ERISA) and applicable regulations.\\nAmounts recognized on our consolidated balance sheets at December 31 are listed below:\\nPension Benefits Postretirement Benefits\\n2022 2021 2022 2021\\nCurrent portion of employee benefit obligation1$— $— $ (1,058) $ (1,106)\\nEmployee benefit obligation2(1,954) (2,811) (4,062) (8,248)\\nNet amount recognized $ (1,954) $ (2,811) $ (5,120) $ (9,354)\\n1Included in “Accounts payable and accrued liabilities.”\\n2Included in “Postemployment benefit obligation,” combined with international pension obligations and other postemployment obligations of $161 a nd $1,083 at\\nDecember 31, 2022, and $364 and $1,226 at December 31, 2021, respectively.\\nThe accumulated benefit obligation for our pension plans represents the actuarial present value of benefits based on\\nemployee service and compensation as of a certain date and does not include an assumption about future compensationlevels. The accumulated benefit obligation for our pension plans was $42,137 at December 31, 2022, and $56,159 atDecember 31, 2021.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n;:',\n", " 'Net Periodic Benefit Cost and Other Amounts Recognized in Other Comprehensive Income\\nPeriodic Benefit CostsThe service cost component of net periodic pension cost (credit) is recorded in operating expenses in the consolidated\\nstatements of income while the remaining components are recorded in “Other income (expense) – net.” Our combinednet pension and postretirement cost (credit) recognized in our consolidated statements of income was $(4,789), $(7,652)and $711 for the years ended December 31, 2022, 2021 and 2020.\\nThe following table presents the components of net periodic benefit cost (credit):\\nPension Benefits Postretirement Benefits\\n2022 2021 2020 2022 2021 2020\\nService cost – benefits earned during the period $ 617 $ 957 $ 1,029 $3 2 $4 5 $5 3\\nInterest cost on projected benefit obligation 1,747 1,276 1,687 277 210 416\\nExpected return on assets (3,107) (3,513) (3,557) (112) (151) (178)\\nAmortization of prior service credit (133) (144) (113) (2,558) (2,537) (2,329)\\nNet periodic benefit cost (credit) before\\nremeasurement (876) (1,424) (954) (2,361) (2,433) (2,038)\\nActuarial (gain) loss (115) (3,461) 2,404 (1,437) (334) 1,299\\nNet pension and postretirement cost (credit) $ (991) $ (4,885) $ 1,450 $ (3,798) $ (2,767) $ (739)\\nOther Changes in Benefit Obligations Recognized in Other Comprehensive Income\\nThe following table presents the after-tax changes in benefit obligations recognized in OCI and the after-tax prior service\\ncredits that were amortized from OCI into net periodic benefit costs:\\nPension Benefits Postretirement Benefits\\n2022 2021 2020 2022 2021 2020\\nBalance at beginning of year $ 416 $5 2 5 $3 6 1 $ 6,496 $ 8,408 $ 8,163\\nPrior service (cost) credit — — 250 1,786 — 2,001\\nAmortization of prior service credit (100) (109) (86) (1,928) (1,912) (1,756)\\nTotal recognized in other comprehensive (income) loss (100) (109) 164 (142) (1,912) 245\\nBalance at end of year $3 1 6 $ 416 $ 525 $ 6,354 $ 6,496 $ 8,408\\nAssumptions\\nIn determining the projected benefit obligation and the net pension and postretirement benefit cost, we used the\\nfollowing significant weighted-average assumptions:\\nPension Benefits Postretirement Benefits\\n2022 2021 2020 2022 2021 2020\\nWeighted-average discount rate for determining\\nbenefit obligation at December 31 5.20 % 3.00 % 2.70 % 5.20 % 2.80 % 2.40 %\\nDiscount rate in effect for determining service cost14.40 % 3.30 % 3.60 % 4.00 % 2.90 % 3.50 %\\nDiscount rate in effect for determining interest cost13.90 % 2.30 % 2.90 % 3.20 % 1.60 % 2.70 %\\nWeighted-average interest credit rate for\\ncash balance pension programs24.10 % 3.20 % 3.10 % —% —% —%\\nLong-term rate of return on plan assets 6.75 % 6.75 % 7.00 % 4.50 % 4.50 % 4.75 %\\nComposite rate of compensation increase for\\ndetermining benefit obligation 3.00 % 3.00 % 3.00 % 3.00 % 3.00 % 3.00 %\\nComposite rate of compensation increase for\\ndetermining net cost (credit) 3.00 % 3.00 % 3.00 % 3.00 % 3.00 % 3.00 %\\n1Weighted-average discount rates shown for years with interim remeasurements: 2022 and 2021 for pension benefits and 2022 for postretirement benefi ts.\\n2Weighted-average interest crediting rates for cash balance pension programs relate only to the cash balance portion of total pension benefits. A 0.5 0% increase in the\\nweighted-average interest crediting rate would increase the pension benefit obligation by $135.\\n;,',\n", " 'We recognize gains and losses on pension and\\npostretirement plan assets and obligations immediately in“Other income (expense) – net” in our consolidatedstatements of income. These gains and losses aregenerally measured annually as of December 31 andaccordingly, will normally be recorded during the fourthquarter, unless an earlier remeasurement is required.Should actual experience differ from actuarialassumptions, the projected pension benefit obligation andnet pension cost and accumulated postretirement benefitobligation and postretirement benefit cost would beaffected in future years.\\nDiscount Rate Our assumed weighted-average discount\\nrates for both pension and postretirement benefits of5.20%, at December 31, 2022, reflect the hypothetical rateat which the projected benefit obligation could beeffectively settled or paid out to participants. Wedetermined our discount rate based on a range of factors,including a yield curve composed of the rates of return onseveral hundred high-quality, fixed income corporatebonds available at the measurement date andcorresponding to the related expected durations of futurecash outflows. These bonds had an average rating of atleast Aa3 or AA- by the nationally recognized statisticalrating organizations, denominated in U.S. dollars, andgenerally not callable, convertible or index linked. For theyear ended December 31, 2022, when compared to theyear ended December 31, 2021, we increased our pensiondiscount rate by 2.20%, resulting in a decrease in ourpension plan benefit obligation of $11,738 and increasedour postretirement discount rate by 2.40%, resulting in adecrease in our postretirement benefit obligation of$2,102. For the year ended December 31, 2021, weincreased our pension discount rate by 0.30%, resulting ina decrease in our pension plan benefit obligation of $1,645and increased our postretirement discount rate by 0.40%,resulting in a decrease in our postretirement benefitobligation of $341.\\nWe utilize a full yield curve approach in the estimation of\\nthe service and interest components of net periodicbenefit costs for pension and other postretirementbenefits. Under this approach, we apply discounting usingindividual spot rates from a yield curve composed of therates of return on several hundred high-quality, fixedincome corporate bonds available at the measurementdate. These spot rates align to each of the projectedbenefit obligations and service cost cash flows. Theservice cost component relates to the active participantsin the plan, so the relevant cash flows on which to applythe yield curve are considerably longer in duration onaverage than the total projected benefit obligation cashflows, which also include benefit payments to retirees.Interest cost is computed by multiplying each spot rate bythe corresponding discounted projected benefitobligation cash flows. The full yield curve approachreduces any actuarial gains and losses based uponinterest rate expectations (e.g., built-in gains in interestcost in an upward sloping yield curve scenario), or gainsand losses merely resulting from the timing andmagnitude of cash outflows associated with our benefitobligations. Neither the annual measurement of our totalbenefit obligations nor annual net benefit cost is affected\\nby the full yield curve approach.\\nExpected Long-Term Rate of Return In 2023, our expected\\nlong-term rate of return is 7.50% on pension plan assetsand 6.50% on postretirement plan assets, an increase of0.75% for pension plan assets and 2.00% forpostretirement plan assets. This update to our assetreturn assumptions was due to economic forecasts andchanges in the asset mix. Our long-term rates of returnreflect the average rate of earnings expected on thefunds invested, or to be invested, to provide for thebenefits included in the projected benefit obligations. Insetting the long-term assumed rate of return,management considers capital markets’ futureexpectations, the asset mix of the plans’ investment andaverage historical asset return. Actual long-term returnscan, in relatively stable markets, also serve as a factor indetermining future expectations. We consider manyfactors that include, but are not limited to, historicalreturns on plan assets, current market information onlong-term returns (e.g., long-term bond rates) and current\\nand target asset allocations between asset categories.\\nThe target asset allocation is determined based onconsultations with external investment advisers. If allother factors were to remain unchanged, we expect that a\\n0.50% decrease in the expected long-term rate of returnwould cause 2023 combined pension and postretirementcost to increase $201. However, any differences in the rateand actual returns will be included with the actuarial gain\\nor loss recorded in the fourth quarter when our plans areremeasured.\\nComposite Rate of Compensation Increase Our expected\\ncomposite rate of compensation increase cost of 3.00% in2022 and 2021 reflects the long-term average rate ofsalary increases.\\nHealthcare Cost Trend Our healthcare cost trend\\nassumptions are developed based on historical cost data,the near-term outlook and an assessment of likely long-term trends. Based on our assessment of expectations ofhealthcare industry inflation, our 2023 assumed annualhealthcare prescription drug cost trend and medical costtrend for eligible participants will increase from an annualand ultimate trend rate of 4.25% to an annual andultimate trend rate of 4.50%. This change in assumptionincreased our obligation by $19. For 2022, our assumedannual healthcare prescription drug cost trend andmedical cost trend for eligible participants increased froman annual and ultimate trend rate of 4.00% to an annualand ultimate trend rate of 4.25%. This change inassumption increased our obligation by $31.\\nPlan AssetsPlan assets consist primarily of private and public equity,\\ngovernment and corporate bonds, and real assets (realestate and natural resources). The asset allocations of the\\npension plans are maintained to meet ERISArequirements. Any plan contributions, as determined byERISA regulations, are made to a pension trust for thebenefit of plan participants. We do not have significantERISA required contributions to our pension plans for2023.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n;;',\n", " 'We maintain VEBA trusts to partially fund postretirement\\nbenefits; however, there are no ERISA or regulatoryrequirements that these postretirement benefit plans befunded annually. We made discretionary contributions of$120 in December 2022 and $308 in December 2021 to ourpostretirement plan.\\nThe principal investment objectives are to ensure the\\navailability of funds to pay pension and postretirementbenefits as they become due under a broad range offuture economic scenarios, maximize long-terminvestment return with an acceptable level of risk basedon our pension and postretirement obligations, anddiversify broadly across and within the capital markets toinsulate asset values against adverse experience in any\\none market. Each asset class has broadly diversifiedcharacteristics. Substantial biases toward any particularinvesting style or type of security are sought to beavoided by managing the aggregation of all accounts withportfolio benchmarks. Asset and benefit obligationforecasting studies are conducted periodically, generallyevery two to three years, or when significant changeshave occurred in market conditions, benefits, participantdemographics or funded status. Decisions regardinginvestment policy are made with an understanding of theeffect of asset allocation on funded status, futurecontributions and projected expenses.\\nThe plans’ weighted-average asset targets and actual allocations as a percentage of plan assets, including the notional\\nexposure of future contracts by asset categories at December 31 are as follows:\\nPension Assets Postretirement (VEBA) Assets\\nTarget 2022 2021 Target 2022 2021\\nEquity securities:\\nDomestic 5 % - 25% 7% 16 % 16 % - 26% 21 % 19 %\\nInternational 1 % - 21% 4 13 16 % - 26% 21 19\\nFixed income securities 40 % - 50% 45 38 42 % - 52% 47 39\\nReal assets — % - 20% 16 10 — % - 6% 1 1\\nPrivate equity — % - 16% 14 12 — % - 6% 1 1\\nPreferred interests 8 % - 18% 13 10 — % - —% — —\\nOther — % - 5% 1 1 5 % - 15% 9 21\\nTotal 100 % 100 % 100 % 100 %\\nThe pension trust holds preferred equity interests valued\\nat $5,427 in AT&T Mobility II LLC (Mobility II), the primaryholding company for our wireless business. The preferredequity interests were valued at $5,562 as of December 31,2021. On December 27, 2022, the pension trust providedwritten notice of its right to require AT&T to purchaseMobility preferred interests outstanding. (See Note 16)\\nAt December 31, 2022, AT&T securities represented 14% of\\nassets held by our pension trust, including the preferredinterests in Mobility II. The VEBA trusts included in thesefinancial statements no longer hold AT&T securities.\\nInvestment ValuationInvestments are stated at fair value. Fair value is the price\\nthat would be received to sell an asset or paid to transfera liability at the measurement date.\\nInvestments in securities traded on a national securities\\nexchange are valued at the last reported sales price onthe final business day of the year. If no sale was reportedon that date, they are valued at the last reported bid price.Investments in securities not traded on a nationalsecurities exchange are valued using pricing models,quoted prices of securities with similar characteristics ordiscounted cash flows. Shares of registered investmentcompanies are valued based on quoted market prices,which represent the net asset value of shares held atyear-end.Other commingled investment entities are valued at\\nquoted redemption values that represent the net assetvalues of units held at year-end which management hasdetermined approximates fair value.\\nReal estate and natural resource direct investments are\\nvalued at amounts based upon appraisal reports. Fixedincome securities valuation is based upon observableprices for comparable assets, broker/dealer quotes(spreads or prices), or a pricing matrix that derivesspreads for each bond based on external market data,including the current credit rating for the bonds, creditspreads to Treasuries for each credit rating, sector add-ons or credits, issue-specific add-ons or credits as well ascall or other options.\\nThe preferred interests in Mobility II are valued by an\\nindependent fiduciary using an income approach.\\nPurchases and sales of securities are recorded as of the\\ntrade date. Realized gains and losses on sales of securitiesare determined on the basis of average cost. Interestincome is recognized on the accrual basis. Dividendincome is recognized on the ex-dividend date.\\nNon-interest bearing cash and overdrafts are valued at\\ncost, which approximates fair value.\\n;?',\n", " 'Fair Value Measurements\\nSee Note 12 for a discussion of the fair value hierarchy that prioritizes the inputs to valuation techniques used to measure\\nfair value.\\nThe following tables set forth by level, within the fair value hierarchy, the pension and postretirement assets and\\nliabilities at fair value as of December 31, 2022:\\nPension Assets and Liabilities at Fair Value as of December 31, 2022\\nLevel 1 Level 2 Level 3 Total\\nNon-interest bearing cash $ 158 $ — $ — $ 158\\nInterest bearing cash 5 — — 5Foreign currency contracts — 4 — 4Equity securities:\\nDomestic equities 2,312 — 2 2,314International equities 1,251 — — 1,251\\nPreferred interests — — 5,427 5,427Fixed income securities:\\nCorporate bonds and other investments — 9,366 1 9,367Government and municipal bonds — 5,450 — 5,450Mortgage-backed securities — 220 — 220\\nReal estate and real assets — — 4,343 4,343Securities lending collateral 1,137 1,407 — 2,544Receivable for variation margin 5 — — 5\\nAssets at fair value 4,868 16,447 9,773 31,088\\nInvestments sold short and other liabilities at fair value (261) (5) — (266)\\nTotal plan net assets at fair value $ 4,607 $ 16,442 $ 9,773 $ 30,822\\nAssets held at net asset value practical expedient\\nPrivate equity funds 5,866\\nReal estate funds 1,907\\nCommingled funds 5,045\\nTotal assets held at net asset value practical expedient 12,818Other assets (liabilities)\\n1(2,766)\\nTotal Plan Net Assets $ 40,874\\n1Other assets (liabilities) include amounts receivable, accounts payable and net adjustment for securities lending payable.\\nPostretirement Assets and Liabilities at Fair Value as of December 31, 2022\\nLevel 1 Level 2 Level 3 Total\\nInterest bearing cash $ 191 $ 4 $ — $ 195\\nEquity securities:\\nDomestic equities 258 — — 258International equities 233 — 1 234\\nSecurities lending collateral — 12 — 12\\nAssets at fair value 682 16 1 699\\nSecurities lending payable and other liabilities — (12) — (12)\\nTotal plan net assets at fair value $ 682 $ 4 $ 1 $ 687\\nAssets held at net asset value practical expedient\\nPrivate equity funds 13\\nReal estate funds 13\\nCommingled funds 1,445\\nTotal assets held at net asset value practical expedient 1,471Other assets (liabilities)\\n12\\nTotal Plan Net Assets $ 2,160\\n1Other assets (liabilities) include amounts receivable and accounts payable.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n;!',\n", " 'The following tables set forth by level, within the fair value hierarchy, the pension and postretirement assets and\\nliabilities at fair value as of December 31, 2021:\\nPension Assets and Liabilities at Fair Value as of December 31, 2021\\nLevel 1 Level 2 Level 3 Total\\nNon-interest bearing cash $ 167 $ — $ — $ 167\\nInterest bearing cash 11 — — 11Foreign currency contracts — 5 — 5Equity securities:\\nDomestic equities 7,693 — 1 7,694International equities 4,117 — 7 4,124\\nPreferred interests — — 5,562 5,562Fixed income securities:\\nCorporate bonds and other investments — 11,168 2 11,170Government and municipal bonds — 6,977 — 6,977Mortgage-backed securities — 268 — 268\\nReal estate and real assets — — 3,318 3,318Securities lending collateral 1,645 1,285 — 2,930Receivable for variation margin 8 — — 8\\nAssets at fair value 13,641 19,703 8,890 42,234\\nInvestments sold short and other liabilities at fair value (529) (3) (1) (533)\\nTotal plan net assets at fair value $ 13,112 $ 19,700 $ 8,889 $ 41,701\\nAssets held at net asset value practical expedient\\nPrivate equity funds 6,454\\nReal estate funds 2,329\\nCommingled funds 6,780\\nTotal assets held at net asset value practical expedient 15,563Other assets (liabilities)\\n1(2,863)\\nTotal Plan Net Assets $ 54,401\\n1Other assets (liabilities) include amounts receivable, accounts payable and net adjustment for securities lending payable.\\nPostretirement Assets and Liabilities at Fair Value as of December 31, 2021\\nLevel 1 Level 2 Level 3 Total\\nInterest bearing cash $ 371 $ 295 $ — $ 666\\nEquity securities:\\nDomestic equities 323 — — 323International equities 287 — 1 288\\nFixed income securities:\\nCorporate bonds and other investments 1 — — 1\\nSecurities lending collateral — 9 — 9\\nAssets at fair value 982 304 1 1,287\\nSecurities lending payable and other liabilities — (9) — (9)\\nTotal plan net assets at fair value $ 982 $ 295 $ 1 $ 1,278\\nAssets held at net asset value practical expedient\\nCommingled funds 1,883\\nPrivate equity funds 19\\nReal estate funds 16\\nTotal assets held at net asset value practical expedient 1,918Other assets (liabilities)\\n12\\nTotal Plan Net Assets $ 3,198\\n1Other assets (liabilities) include amounts receivable and accounts payable.\\n;¿',\n", " 'For the years ended December 31, 2022 and 2021, our postretirement assets did not include significant investments in\\nLevel 3 assets, nor were there significant changes in fair value of those assets during the period. The tables below setforth a summary of changes in the fair value of the Level 3 pension assets for the years ended:\\nEquitiesFixed Income\\nFundsReal Estate and\\nReal Assets Total\\nBalance as of December 31, 2021 $ 5,569 $ 2 $ 3,318 $ 8,889\\nRealized gains (losses) 1 — 22 23Unrealized gains (losses) (139) — 802 663Transfers in 1 1 20 22Transfers out — (2) (29) (31)Purchases — — 716 716Sales (3) — (506) (509)\\nBalance as of December 31, 2022 $ 5,429 $ 1 $ 4,343 $ 9,773\\nEquitiesFixed Income\\nFundsReal Estate and\\nReal Assets Total\\nBalance as of December 31, 2020 $ 5,793 $ 53 $ 2,544 $ 8,390\\nRealized gains (losses) 2 — (31) (29)Unrealized gains (losses) (203) — 558 355Transfers in — 1 — 1Transfers out (7) (8) — (15)Purchases 7 1 425 433Sales (23) (45) (178) (246)\\nBalance as of December 31, 2021 $ 5,569 $ 2 $ 3,318 $ 8,889\\nEstimated Future Benefit Payments\\nExpected benefit payments are estimated using the same\\nassumptions used in determining our benefit obligation atDecember 31, 2022. Because benefit payments will dependon future employment and compensation levels; averageyears employed; average life spans; and paymentelections, among other factors, changes in any of theseassumptions could significantly affect these expectedamounts. The following table provides expected benefitpayments under our pension and postretirement plans:\\nPension\\nBenefitsPostretirement\\nBenefits\\n2023 $ 5,612 $ 1,211\\n2024 3,734 8012025 3,747 6402026 3,632 5982027 3,561 568Years 2028 - 2032 16,688 2,322Supplemental Retirement Plans\\nWe also provide certain senior- and middle-management\\nemployees with nonqualified, unfunded supplementalretirement and savings plans. While these plans areunfunded, we have assets in a designated non-bankruptcyremote trust that are independently managed and usedto provide for certain of these benefits. These plansinclude supplemental pension benefits as well ascompensation-deferral plans, some of which include acorresponding match by us based on a percentage of thecompensation deferral. For our supplemental retirementplans, the projected benefit obligation was $1,544 and thenet supplemental retirement pension credit was $234 atand for the year ended December 31, 2022. The projectedbenefit obligation was $2,326 and the net supplementalretirement pension credit was $41 at and for the yearended December 31, 2021.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n?\\x08',\n", " 'We use the same significant assumptions for the\\ncomposite rate of compensation increase in determiningour projected benefit obligation and the net pension andpostemployment benefit cost. Our discount rates of 5.10%at December 31, 2022 and 2.70% at December 31, 2021were calculated using the same methodologies used incalculating the discount rates for our qualified pensionand postretirement benefit plans.\\nDeferred compensation expense was $94 in 2022, $171 in\\n2021 and $183 in 2020.\\nContributory Savings PlansWe maintain contributory savings plans that cover\\nsubstantially all employees. Under the savings plans, wematch in cash or company stock a stated percentage ofeligible employee contributions, subject to a specifiedceiling. There are no debt-financed shares held by theEmployee Stock Ownership Plans, allocated orunallocated.\\nOur match of employee contributions to the savings plans\\nis fulfilled with purchases of our stock on the open marketor company cash. Benefit cost, which is based on the costof shares or units allocated to participating employees’accounts or the cash contributed to participant accounts,was $611, $614 and $646 for the years ended December 31,2022, 2021 and 2020.\\nNOTE 15. SHARE-BASED PAYMENTS\\nUnder our various plans, senior and other management\\nemployees and nonemployee directors have receivednonvested stock and stock units. The shares will vest overa period of one to four years in accordance with the termsof those plans.\\nWe grant performance stock units, which are nonvested\\nstock units, based upon our stock price at the date ofgrant and award them in the form of AT&T common stockand cash at the end of a three-year period, subject to theachievement of certain performance goals. We treat thecash settled portion of these awards as a liability. Effectivewith the 2021 plan year, for the majority of employees,performance shares were replaced with restricted stockunits that do not have any performance conditions. Thesenew restricted stock units vest ratably over a three-yearperiod. We grant forfeitable restricted stock and stockunits, which are valued at the market price of ourcommon stock at the date of grant and predominantlyvest over a three- to five-year period. We also grant othernonvested stock units and award them in cash at the endof a three-year period, subject to the achievement ofcertain market-based conditions. As of December 31, 2022,we were authorized to issue up to approximately 128million shares of common stock (in addition to shares thatmay be issued upon exercise of outstanding options orupon vesting of performance stock units or othernonvested stock units) to officers, employees anddirectors pursuant to these various plans.We account for our share-based payment arrangements\\nbased on the fair value of the awards on their respectivegrant date, which may affect our ability to fully realize thevalue shown on our consolidated balance sheets ofdeferred tax assets associated with compensationexpense. We record a valuation allowance when our futuretaxable income is not expected to be sufficient to recoverthe asset. Accordingly, there can be no assurance that thecurrent stock price of our common shares will rise tolevels sufficient to realize the entire tax benefit currentlyreflected on our consolidated balance sheets. However, tothe extent we generate excess tax benefits (i.e., thoseadditional tax benefits in excess of the deferred taxesassociated with compensation expense previouslyrecognized) the potential future impact on income wouldbe reduced.\\nOur consolidated statements of income include the\\ncompensation cost recognized for those plans asoperating expenses, as well as the associated tax benefits,which are reflected in the table below:\\n2022 2021 2020\\nPerformance stock units $1 6 8 $ 248 $ 348\\nRestricted stock and stock units 350 199 74\\nOther nonvested stock units — ——\\nStock options — ——\\nTotal $5 1 8 $ 447 $ 422\\nIncome tax benefit $ 127 $ 110 $ 104\\nA summary of the status of our nonvested stock units as\\nof December 31, 2022, and changes during the year thenended is presented as follows (shares in millions):\\nNonvested Stock Units SharesWeighted-Average\\nGrant-Date Fair Value\\nNonvested at January 1, 2022 35 $32.33\\nGranted 21 23.64Vested (28) 27.64Forfeited (5) 23.76Spin-off Adjustment\\n113 NA\\nNonvested at December 31, 2022 36 $22.07\\n1In connection with the WarnerMedia transaction, AT&T made certain\\nadjustments to the number of stock awards to maintain the intrinsic valueprior to the spin-off.\\nAs of December 31, 2022, there was $547 of totalunrecognized compensation cost related to nonvestedshare-based payment arrangements granted. That cost isexpected to be recognized over a weighted-averageperiod of 1.69 years. The total fair value of shares vestedduring the year was $783 for 2022, compared to $608 for2021 and $471 for 2020.\\nIt is our intent to satisfy share option exercises using our\\ntreasury stock. Cash received from stock option exerciseswas $2 for 2022, $11 for 2021 and $21 for 2020.\\n?\\t',\n", " 'NOTE 16. STOCKHOLDERS’ EQUITY\\nAuthorized Shares We have authorized 14 billion\\ncommon shares of AT&T stock and 10 million preferredshares of AT&T stock, each with a par value of $1.00 pershare. Cumulative perpetual preferred shares consist ofthe following:\\n• Series A: 48 thousand shares outstanding at\\nDecember 31, 2022 and December 31, 2021, with a$25,000 per share liquidation preference and adividend rate of 5.000%.\\n• Series B: 20 thousand shares outstanding at\\nDecember 31, 2022 and December 31, 2021, with a€100,000 per share liquidation preference, and aninitial rate of 2.875%, subject to reset after May 1,2025.\\n• Series C: 70 thousand shares outstanding at\\nDecember 31, 2022 and December 31, 2021, with a$25,000 per share liquidation preference, and adividend rate of 4.75%.\\nSo long as the quarterly preferred dividends are declared\\nand paid on a timely basis on each series of preferredshares, there are no limitations on our ability to declare adividend on or repurchase AT&T common shares. Thepreferred shares are optionally redeemable by AT&T atthe liquidation price on or after five years from theissuance date, or upon certain other contingent events.\\nStock Repurchase Program From time to time, we\\nrepurchase shares of common stock for distributionthrough our employee benefit plans or in connection withcertain acquisitions. Our Board of Directors has approvedthe following authorization to repurchase common stock:(1) March 2013 authorization program of 300 millionshares, which was completed in 2020 and (2) March 2014authorization program for 300 million shares, withapproximately 144 million outstanding at December 31,2022.\\nTo implement these authorizations, we used open market\\nrepurchases, relying on Rule 10b5-1 of the SecuritiesExchange Act of 1934, where feasible. We also usedaccelerated share repurchase agreements with largefinancial institutions to repurchase our stock. During 2021,there were no shares repurchased under the March 2014authorization. During 2022, we repurchased approximately34 million shares totaling $662 under the March 2014authorization.\\nDividend Declarations In December 2022 and December\\n2021, AT&T declared a quarterly preferred dividend of $36.In December 2022 and December 2021, AT&T declared acommon dividend of $0.2775 and $0.52 per share ofcommon stock, respectively.Preferred Interests Issued by Subsidiaries We have\\nissued cumulative perpetual preferred membershipinterests in certain subsidiaries. The preferred interestsare entitled to cash distributions, subject to declaration.The preferred interests are included in “Noncontrollinginterest” on the consolidated balance sheets.\\nMobility II\\nIn 2018, we issued 320 million Series A CumulativePerpetual Preferred Membership Interests in Mobility II(Mobility preferred interests), which pay cash distributionsof 7% per annum, subject to declaration. So long as thedistributions are declared and paid, the terms of theMobility preferred equity interests will not impose anylimitations on cash movements between affiliates, or ourability to declare a dividend on or repurchase AT&Tshares.\\nA holder of the Mobility preferred interests may put the\\ninterests to Mobility II. Mobility II may redeem theinterests upon a change in control of Mobility II or on orafter September 9, 2022. When either option arises due toa passage of time, that option may be exercised onlyduring certain periods.\\nThe price at which a put option or a redemption option\\ncan be exercised is the greater of (1) the market value ofthe interests as of the last date of the quarter precedingthe date of the exercise of a put or redemption option and(2) the sum of (a) twenty-five dollars plus (b) any accruedand unpaid distributions. The redemption price may bepaid with cash, AT&T common stock, or a combination ofcash and AT&T common stock, at Mobility II’s soleelection. In no event shall Mobility II be required to delivermore than 250 million shares of AT&T common stock tosettle put and redemption options. We have the intentand ability to settle the Mobility preferred equity interestswith cash.\\nOn October 24, 2022, approximately 105 million Mobility\\npreferred interests were put to AT&T by a third-partyinvestor, for which we paid approximately $2,600 cash toredeem. On December 27, 2022, the AT&T pension trustprovided written notice of its right to require us topurchase the remaining 213 million, or approximately$5,340, of Mobility preferred interests outstanding. Theterms of the instruments limit the amount we arerequired to redeem in any 12-month period toapproximately 107 million shares, or $2,670. We expect toredeem approximately $2,670 of the Mobility preferredinterests primarily in October 2023 and $2,670 in October2024, unless the interests are called or the puts areaccepted by AT&T prior to those dates. With the certaintyof redemption, the remaining Mobility preferred interestsNotes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n? ',\n", " 'were reclassified from equity to a liability at fair value, with\\napproximately $2,670 recorded in current liabilities as“Accounts payable and accrued liabilities” and $2,670recorded in “Other noncurrent liabilities.” The liabilitiesassociated with the Mobility preferred interests areconsidered Level 3 under the Fair Value Measurement andDisclosure framework (see Notes 12 and 14). Thedifference between the carrying value of the Mobilitypreferred interest, which represented fair value atcontribution, and the fair value of the instrument uponsettlement and/or balance sheet reclassification wasrecorded as an adjustment to additional paid-in capital.\\nAs of December 31, 2022, we have approximately\\n213 million Mobility preferred interests outstanding, whichhave a redemption value of approximately $5,340 and paycash distributions of $373 per annum, subject todeclaration.\\nTower Holdings\\nIn 2019, we issued $6,000 nonconvertible cumulativepreferred interests in a wireless subsidiary (TowerHoldings) that holds interests in various tower assets andhave the right to receive approximately $6,000 if thepurchase options from the tower companies areexercised.\\nThe membership interests in Tower Holdings consist of (1)\\ncommon interests, which are held by a consolidatedsubsidiary of AT&T, and (2) two series of preferredinterests (collectively the “Tower preferred interests”).The September series (Class A-1) of the preferredinterests totals $1,500 and pays an initial preferreddistribution of 5.0%, and the December series (Class A-2)totals $4,500 and pays an initial preferred distribution of4.75%. Distributions are paid quarterly, subject todeclaration, and reset every five years. Any failure todeclare or pay distributions on the Tower preferredinterests would not impose any limitation on cashmovements between affiliates, or our ability to declare adividend on or repurchase AT&T shares. We can call theTower preferred interests at the issue price beginning fiveyears from the issuance date or upon the receipt ofproceeds from the sale of the underlying assets.\\nThe holders of the Tower preferred interests have the\\noption to require redemption upon the occurrence ofcertain contingent events, such as the failure of AT&T topay the preferred distribution for two or more periods orto meet certain other requirements, including a minimumcredit rating. If notice is given upon such an event, allother holders of equal or more subordinate classes ofmembership interests in Tower Holdings are entitled toreceive the same form of consideration payable to theholders of the preferred interests, resulting in a deemedliquidation for accounting purposes.Telco LLC\\nIn September 2020, we issued $2,000 nonconvertiblecumulative preferred interests out of a newly createdlimited liability company (Telco LLC) that was formed tohold telecommunication-related assets.\\nMembers’ equity in Telco LLC consist of (1) member’s\\ninterests, which are held by a consolidated subsidiary ofAT&T, and (2) preferred interests (Telco preferredinterests), which pay an initial preferred distribution of4.25% annually, subject to declaration, and subject toreset every seven years. Failure to pay distributions on theTelco preferred interests would not limit cash movementsbetween affiliates, or our ability to declare a dividend onor repurchase AT&T shares. We can call the Telcopreferred interests at the issue price beginning sevenyears from the issuance date.\\nThe holders of the Telco preferred interests have the\\noption to require redemption upon the occurrence ofcertain contingent events, such as the failure of Telco LLCto pay the preferred distribution for two or more periodsor to meet certain other requirements, including aminimum credit rating. If notice is given, all other holdersof equal or more subordinate classes of members’ equityare entitled to receive the same form of considerationpayable to the holders of the preferred interests, resultingin a deemed liquidation for accounting purposes.\\nPR Holdings\\nIn 2019, we issued $1,950 nonconvertible cumulative\\npreferred interests in a subsidiary (PR Holdings) that heldnotes secured by the proceeds from our agreement to sellwireless and wireline operations in Puerto Rico and theU.S. Virgin Islands. These preferred interests wereredeemed on November 6, 2020. (See Note 6)\\nThe membership interests in PR Holdings consisted of (1)\\ncommon interests, which were held by consolidatedsubsidiaries of AT&T, and (2) preferred interests (PRpreferred interests). The PR preferred interests paid aninitial preferred distribution at an annual rate of 4.75%.Distributions were paid quarterly, subject to declaration.\\nNOTE 17. SALES OF RECEIVABLES\\nWe have agreements with various third-party financial\\ninstitutions pertaining to the sales of certain types of ouraccounts receivable. The most significant of theseprograms consists of receivables arising from equipmentinstallment plans, which are sold for cash and a deferredpurchase price. Under this program, we transferreceivables to purchasers in exchange for cash andadditional consideration upon settlement of thereceivables. Under the terms of our agreement for thisprogram, we continue to service the transferredreceivables on behalf of the financial institutions.\\n?.',\n", " 'The following table sets forth a summary of cash\\nproceeds received, net of remittances paid, from sales ofreceivables for the years ended December 31:\\n2022 2021 2020\\nNet cash received (paid) from\\nequipment installmentreceivables\\n1$ 1,875 $ 1,000 $ (1,565)\\nNet cash received (paid) from\\nother programs 620 (295) 295\\nTotal net cash impact to cash\\nflows from operating activities $ 2,495 $ 705 $ (1,270)\\n1Net cash from initial sales of $11,129, $9,740 and $6,089 for the years ended\\nDecember 31, 2022, 2021 and 2020, respectively.\\nThe sales of receivables did not have a material impact on\\nour consolidated statements of income or to “TotalAssets” reported on our consolidated balance sheets. Wereflect cash receipts on sold receivables as cash flowsfrom operations in our consolidated statements of cashflows. Cash receipts on the deferred purchase price areclassified as cash flows from investing activities, whenapplicable.\\nThe following table sets forth a summary of the\\nequipment installment receivables and accounts beingserviced at December 31:\\n2022 2021\\nGross receivables: $ 4,165 $4 , 3 6 1\\nBalance sheet classification\\nAccounts receivable\\nNotes receivable 1,789 1,846\\nTrade receivables 522 606\\nOther Assets\\nNoncurrent notes and trade\\nreceivables 1,854 1,909\\nOutstanding portfolio of receivables\\nderecognized from our consolidatedbalance sheets $ 11,030 $ 9,767\\nCash proceeds received, net of\\nremittances\\n18,519 6,644\\n1Represents amounts to which financial institutions remain entitled, excluding\\nthe deferred purchase price.\\nWe offer our customers the option to purchase certainwireless devices in installments over a specified period oftime and, in many cases, once certain conditions are met,they may be eligible to trade in the original equipment fora new device and have the remaining unpaid balance paidor settled.We maintain a program under which we transfer a portion\\nof these receivables through our bankruptcy-remotesubsidiary in exchange for cash and additionalconsideration upon settlement of the receivables,referred to as the deferred purchase price. In the event acustomer trades in a device prior to the end of theinstallment contract period, we agree to make a paymentto the financial institutions equal to any outstandingremaining installment receivable balance. Accordingly, werecord a guarantee obligation for this estimated amountat the time the receivables are transferred.\\nThe following table sets forth a summary of equipment\\ninstallment receivables sold under this program:\\n2022 2021 2020\\nGross receivables sold $ 11,510 $ 10,793 $ 7,270\\nNet receivables sold111,061 10,502 7,026\\nCash proceeds received 11,129 9,740 6,089\\nDeferred purchase price\\nrecorded 245 1,080 1,021\\nGuarantee obligation recorded 703 434 157\\n1Receivables net of allowance, imputed interest and equipment trade-in right\\nguarantees.\\nThe deferred purchase price and guarantee obligation areinitially recorded at estimated fair value and subsequentlyadjusted for changes in present value of expected cashflows. The estimation of their fair values is based onremaining installment payments expected to be collectedand the expected timing and value of device trade-ins.The estimated value of the device trade-ins considersprices offered to us by independent third parties andcontemplate changes in value after the launch of a devicemodel. The fair value measurements used for the deferredpurchase price and the guarantee obligation areconsidered Level 3 under the Fair Value Measurement andDisclosure framework (see Note 12).\\nThe following table presents the previously transferred\\nequipment installment receivables, which we repurchasedin exchange for the associated deferred purchase price:\\n2022 2021 2020\\nFair value of repurchased\\nreceivables $ 3,314 $ 1,424 $ 1,271\\nCarrying value of deferred\\npurchase price 3,335 1,334 1,235\\nGain (loss) on repurchases1$ (21) $9 0 $ 3 6\\n1These gains (losses) are included in “Selling, general and administrative” expense\\nin the consolidated statements of income.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n?:',\n", " 'At December 31, 2022 and December 31, 2021, our deferred\\npurchase price receivable was $2,318 and $3,177,respectively, of which $1,278 and $2,123 are included in“Prepaid and other current assets” on our consolidatedbalance sheets, with the remainder in “Other Assets.” Theguarantee obligation at December 31, 2022 andDecember 31, 2021 was $419 and $371, respectively, ofwhich $73 and $101 are included in “Accounts payable andaccrued liabilities” on our consolidated balance sheets,with the remainder in “Other noncurrent liabilities.” Ourmaximum exposure to loss as a result of selling theseequipment installment receivables is limited to the totalamount of our deferred purchase price and guaranteeobligation.\\nNOTE 18. TOWER TRANSACTION\\nIn December 2013, we closed our transaction with Crown\\nCastle International Corp. (Crown Castle) in which CrownCastle gained the exclusive rights to lease and operate9,048 wireless towers and purchased 627 of our wirelesstowers for $4,827 in cash. The leases have various termswith an average length of approximately 28 years. As theleases expire, Crown Castle will have fixed price purchaseoptions for these towers totaling approximately $4,200,based on their estimated fair market values at the end ofthe lease terms. We sublease space on the towers fromCrown Castle for an initial term of ten years at currentmarket rates, subject to optional renewals in the future.\\nWe determined that we did not transfer control of the\\ntower assets, which prevented us from achieving sale-leaseback accounting for the transaction, and weaccounted for the cash proceeds from Crown Castle as afinancing obligation on our consolidated balance sheets.We record interest on the financing obligation using theeffective interest method at a rate of approximately 3.9%.The financing obligation is increased by interest expenseand estimated future net cash flows generated andretained by Crown Castle from operation of the towersites, and reduced by our contractual payments. Wecontinue to include the tower assets in “Property, Plantand Equipment – Net” on our consolidated balance sheetsand depreciate them accordingly. At December 31, 2022and 2021, the tower assets had a balance of $686 and$725, respectively. Our depreciation expense for theseassets was $39 for each of 2022, 2021 and 2020.\\nPayments made to Crown Castle under this arrangement\\nwere $258 for 2022. At December 31, 2022, the futureminimum payments under the sublease arrangement are$264 for 2023, $269 for 2024, $274 for 2025, $280 for 2026,$285 for 2027 and $421 thereafter.NOTE 19. TRANSACTIONS WITH DIRECTV\\nEffective August 1, 2021, we began accounting for our\\ninvestment in DIRECTV under the equity method andrecorded our share of DIRECTV earnings as equity in netincome of affiliates, with DIRECTV considered a relatedparty (see Note 10).\\nFor the year ended December 31, 2022 , our share of\\nDIRECTV’s earnings included in equity in net income of\\naffiliates was $1,808 . Cash distributions from DIRECTV\\ntotaled $4,457 , with $1,808 classified as operating\\nactivities and $2,649 classified as investing activities in our\\nconsolidated statement of cash flows. Our investment in\\nDIRECTV at December 31, 2022 was $2,911 .\\nIn addition to the assets and liabilities contributed to\\nDIRECTV, we recorded total obligations of $2,100 to cover\\ncertain net losses under the NFL SUNDAY TICKET\\ncontract, of which $1,800 is in the form of a note payable\\nto DIRECTV. For the year ended December 31, 2022, cash\\npayments to DIRECTV on the note totaled $1,211 and were\\nclassified as financing activities in our consolidatedstatement of cash flows. Amounts due under the DIRECTVnote were $130\\nat December 31, 2022 .\\nWe also provide DIRECTV with network transport for U-\\nverse products and sales services under commercialarrangements for up to five years. Under separatetransition services agreements, we provide DIRECTVcertain operational support, including servicing of certainof their customer receivables for up to three years.\\nFor\\nthe year ended December 31, 2022 , we billed DIRECTV\\napproximately $1,260 for these costs, which were primarily\\nrecorded as a reduction to the operations and support\\nexpenses incurred and resulted in net retained costs to\\nAT&T of approximately $737 .\\nAt December 31, 2022, we had accounts receivable from\\nDIRECTV of $360 and accounts payable to DIRECTV of$120.\\nWe are not committed, implicitly or explicitly, to provide\\nfinancial or other support, other than noted above, as ourinvolvement with DIRECTV is limited to the carryingamount of the assets and liabilities recognized on ourbalance sheet.\\nNOTE 20. FIRSTNET\\nIn 2017, the First Responder Network Authority (FirstNet)\\nselected AT&T to build and manage the first nationwidebroadband network dedicated to America’s firstresponders. Under the 25-year agreement, FirstNetprovides 20 MHz of valuable telecommunicationsspectrum and success-based payments of $6,500 over thefirst five years to support network buildout. We arerequired to construct a network that achieves coverage\\n?,',\n", " 'and nationwide interoperability requirements and have a\\ncontractual commitment to make sustainability paymentsof $18,000 over the 25-year contract. These sustainabilitypayments represent our commitment to fund FirstNet’soperating expenses and future reinvestments in thenetwork which we own and operate, which we estimate inthe $3,000 or less range over the life of the 25-yearcontract. After FirstNet’s operating expenses are paid, weanticipate the remaining amount, expected to be in the$15,000 range, will be reinvested into the network.\\nDuring 2022, we submitted $195 in sustainability\\npayments, with future payments under the agreement of$195 for 2023, 2024 and 2025; $1,590 for 2026, $1,665 for2027; and $13,365 thereafter. Amounts paid to FirstNet,which are not expected to be returned to AT&T to bereinvested into our network, will be expensed in theperiod paid. In the event FirstNet does not reinvest anyfunds to construct, operate, improve and maintain thisnetwork, our maximum exposure to loss is the totalamount of the sustainability payments, which would bereflected in higher expense.\\nThe $6,500 of initial funding from FirstNet is contingent on\\nthe achievement of six operating capability milestonesand certain first responder subscriber adoption targets.These milestones are based on coverage objectives of thefirst responder network during the construction period,which is expected to be over five years, and subscriberadoption targets. Funding payments received fromFirstNet are reflected as a reduction from the costs\\ncapitalized in the construction of the network and, asappropriate, a reduction of associated operatingexpenses. As of December 31, 2022, we have collectedapproximately $6,120 for the completion of certain tasksand anticipate collecting nearly all of the remainder of the$6,500 as we fulfill contractual deliveries set out byFirstNet in 2023.\\nNOTE 21. CONTINGENT LIABILITIES\\nWe are party to numerous lawsuits, regulatory\\nproceedings and other matters arising in the ordinarycourse of business. In evaluating these matters on anongoing basis, we take into account amounts alreadyaccrued on the balance sheet. In our opinion, although theoutcomes of these proceedings are uncertain, they shouldnot have a material adverse effect on our financialposition, results of operations or cash flows.\\nWe have contractual obligations to purchase certain\\ngoods or services from various other parties. Ourpurchase obligations are expected to be approximately$12,313 in 2023, $11,424 in total for 2024 and 2025, $2,457 intotal for 2026 and 2027 and $821 in total for yearsthereafter.\\nSee Note 12 for a discussion of collateral and credit-risk\\ncontingencies.\\nNOTE 22. ADDITIONAL FINANCIAL INFORMATION\\nDecember 31,\\nConsolidated Balance Sheets 2022 2021\\nAccounts payable and accrued liabilities:\\nAccounts payable $ 31,101 $ 29,511\\nAccrued payroll and commissions 1,605 2,082\\nCurrent portion of employee benefit obligation 1,173 1,234\\nCurrent portion of Mobility preferred interests12,670 —\\nAccrued interest 2,160 2,438\\nAccrued taxes 798 1,148\\nOther 3,137 2,682\\nTotal accounts payable and accrued liabilities $ 42,644 $ 39,095\\n1Reported as noncontrolling interest in 2021. (See Note 16)\\nConsolidated Statements of Income 2022 2021 2020\\nAdvertising expense $ 2,462 $ 2,732 $ 2,705\\nInterest expense incurred $ 7,402 $ 7,670 $ 7,850\\nCapitalized interest – capital expenditures (174) (173) (123)\\nCapitalized interest – spectrum1(1,120) (781) —\\nTotal interest expense $ 6,108 $ 6,716 $ 7,727\\n1Included in “Acquisitions, net of cash acquired” on our consolidated statements of cash flows.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n?;',\n", " 'Cash and Cash Flows We typically maintain our restricted cash balances for purchases and sales of certain investment\\nsecurities and funding of certain deferred compensation benefit payments.\\nThe following table summarizes cash and cash equivalents and restricted cash balances contained on our consolidated\\nbalance sheets:\\nDecember 31,\\nCash and Cash Equivalents and Restricted Cash 2022 2021 2020 2019\\nCash and cash equivalents from continuing operations $ 3,701 $ 19,223 $ 7,924 $ 9,702\\nCash and cash equivalents from discontinued operations — 1,946 1,816 2,428\\nRestricted cash in Prepaid and other current assets 1 39 6 9\\nRestricted cash in Other Assets 91 144 121 96\\nCash and cash equivalents and restricted cash $ 3,793 $ 21,316 $ 9,870 $ 12,295\\nThe following tables summarize certain cash flow activities from continuing operations:\\nConsolidated Statements of Cash Flows 2022 2021 2020\\nCash paid (received) during the year for:\\nInterest $ 7,772 $ 7,485 $ 8,010\\nIncome taxes, net of refunds1592 252 577\\n1Total cash income taxes paid, net of refunds, by AT&T was $696, $700 and $993 for 2022, 2021 and 2020, respectively.\\nPurchase of property and equipment $ 19,452 $ 15,372 $ 14,567\\nInterest during construction - capital expenditures1174 173 123\\nTotal Capital expenditures $ 19,626 $ 15,545 $ 14,690\\nBusiness acquisitions $— $— $1 2\\nSpectrum acquisitions 9,080 24,672 1,613\\nInterest during construction - spectrum11,120 781 —\\nTotal Acquisitions, net of cash acquired $ 10,200 $ 25,453 $ 1,625\\n1Total capitalized interest was $1,294, $954 and $123 for 2022, 2021 and 2020, respectively.\\nNoncash Investing and Financing Activities In\\nconnection with capital improvements and the acquisitionof other productive assets, we negotiate favorablepayment terms (referred to as vendor financing), whichare reported as financing activities in our statements ofcash flows when paid. We recorded $5,817 of vendorfinancing commitments related to capital investments in2022, $5,282 in 2021 and $4,664 in 2020.\\nTotal vendor financing payables included in our December\\n31, 2022 consolidated balance sheet were approximately$6,147, with $4,592 due within one year (in “Accountspayable and accrued liabilities”) and the remainderpredominantly due within five years (in “Other noncurrentliabilities”).Labor Contracts As of January 31, 2023, we employed\\napproximately 160,700 persons. Approximately 42% of ouremployees are represented by the CommunicationsWorkers of America (CWA), the International Brotherhoodof Electrical Workers (IBEW) or other unions. Afterexpiration of in place agreements with these groups, workstoppages or labor disruptions may occur in the absenceof new contracts or other agreements being reached. Themain contracts included the following:\\n• A contract covering approximately 7,000 Mobility\\nemployees in nine states, for which we reachedtentative agreement in February 2023.\\n• A contract covering approximately 400 employees\\nsupporting internet-based products is set to expire inJuly 2023.\\n• A contract covering approximately 200 Mobility\\nemployees in Illinois is set to expire in May 2023.\\n??',\n", " 'NOTE 23. DISCONTINUED OPERATIONS\\nUpon the separation and distribution, the WarnerMedia\\nbusiness met the criteria for discontinued operations. Fordiscontinued operations, we also evaluated transactionsthat were components of AT&T’s single plan of a strategicshift, including dispositions that previously did notindividually meet the criteria due to materiality, and havedetermined discontinued operations to be comprised ofWarnerMedia, Vrio, Xandr and Playdemic.\\nThe following is a summary of operating results included\\nin income (loss) from discontinued operations for theyears ended:\\n2022 2021 2020\\nRevenues $ 9,454 $ 34,826 $ 28,710\\nOperating Expenses\\nCost of revenues 5,481 19,400 14,269\\nSelling, general and\\nadministrative 2,791 8,275 7,222\\nAsset abandonments and\\nimpairments1— 4,691 3,193\\nDepreciation and amortization 1,172 5,010 5,993\\nTotal operating expenses 9,444 37,376 30,677\\nInterest expense 131 168 198\\nEquity in net income (loss) of\\naffiliates (27) 28 6\\nOther income (expense) - net2(87) 466 (343)\\nTotal other income (expense) (245) 326 (535)\\nNet loss before income taxes (235) (2,224) (2,502)\\nIncome tax expense (benefit) (54) 73 (203)\\nNet loss from discontinued\\noperations $ (181) $ (2,297) $ (2,299)\\n12021 includes $4,555 impairment resulting from our assessment of the\\nrecoverability of Vrio’s net assets. 2020 includes approximately $2,200 ofgoodwill impairment at Vrio and $1,000 from production, content and otherimpairment at WarnerMedia. The implied fair values of the Vrio business wasestimated using both the discounted cash flow as well as market multipleapproaches. The fair values of film productions were estimated using adiscounted cash flow approach. The inputs to all of these approaches areconsidered Level 3.\\n2“Other income (expense) - net” includes the gain of $706 from Playdemic\\nfor the year ended 2021.The following is a summary of assets and liabilities\\nattributable to discontinued operations, which wereincluded in our historical Consolidated Balance Sheet atDecember 31:\\n2021\\nAssets:\\nCurrent assets $ 9,005\\nNoncurrent Inventories and Theatrical Film and\\nTelevision Production Costs 18,983\\nProperty, Plant and Equipment – Net 4,255Goodwill 40,484Other Intangibles – Net 40,273Other Assets 6,776\\nTotal Assets, discontinued operations $ 119,776\\nLiabilities:\\nCurrent liabilities $ 12,912Other liabilities 20,643\\nTotal Liabilities, discontinued operations $ 33,555\\nIn preparation for close of the separation and distribution,\\non April 7, 2022, Spinco drew $10,000 on its $10,000 termloan credit agreement (Spinco Term Loan), whichconveyed to WBD. Total debt conveyed wasapproximately $41,600, which included $1,600 of existingWarnerMedia debt, $30,000 of Spinco senior notes issuedin March 2022 and the $10,000 Spinco Term Loan.WarnerMedia cash transfer to Discovery wasapproximately $2,660.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n?!',\n", " 'NOTE 24. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)\\nThe following tables represent our quarterly financial results:\\n2022 Calendar Quarter\\nFirst1Second1Third1Fourth1,2Annual\\nTotal Operating Revenues $ 29,712 $ 29,643 $ 30,043 $ 31,343 $ 120,741\\nOperating Income (Loss) 5,537 4,956 6,012 (21,092) (4,587)\\nNet Income (Loss) from\\nContinuing Operations 5,149 4,751 6,346 (23,120) (6,874)\\nNet Income (Loss) from Continuing\\nOperations Attributable to Common Stock 4,747 4,319 5,924 (23,536) (8,546)\\nBasic Earnings (Loss) Per Share\\nAttributable to Common Stock from\\nContinuing Operations3$ 0.66 $ 0.60 $ 0.82 $ (3.20) $ (1.10)\\nDiluted Earnings (Loss) Per Share\\nAttributable to Common Stock from\\nContinuing Operations3$ 0.65 $ 0.59 $ 0.79 $ (3.20) $ (1.10)\\n1Includes actuarial gains and losses on pension and postretirement benefit plans (Note 14).\\n2Includes goodwill impairments (Note 9) and an asset abandonment charge (Note 7).\\n3Quarterly earnings per share impacts may not add to full-year earnings per share impacts due to the difference in weighted-average common shares for t he quarters\\nversus the weighted-average common shares for the year.\\n2021 Calendar Quarter\\nFirst1Second1Third1Fourth1Annual\\nTotal Operating Revenues $ 35,877 $ 35,740 $ 31,326 $ 31,095 $ 134,038\\nOperating Income 7,194 7,572 6,237 4,894 25,897Net Income from Continuing Operations 7,586 5,969 5,019 5,202 23,776\\nNet Income from Continuing\\nOperations Attributable to Common Stock 7,143 5,526 4,613 4,802 22,084\\nBasic Earnings Per Share\\nAttributable to Common Stock from\\nContinuing Operations\\n2$ 0.99 $ 0.77 $ 0.64 $ 0.67 $ 3.07\\nDiluted Earnings Per Share\\nAttributable to Common Stock from\\nContinuing Operations2$ 0.97 $ 0.76 $ 0.63 $ 0.66 $ 3.02\\n1Includes actuarial gains and losses on pension and postretirement benefit plans (Note 14).\\n2Quarterly earnings per share impacts may not add to full-year earnings per share impacts due to the difference in weighted-average common shares for t he quarters\\nversus the weighted-average common shares for the year.\\n?¿',\n", " 'The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting\\nprinciples. The integrity and objectivity of the data in these financial statements, including estimates and judgmentsrelating to matters not concluded by year end, are the responsibility of management, as is all other information includedin the Annual Report, unless otherwise indicated.\\nThe financial statements of AT&T Inc. (AT&T) have been audited by Ernst & Young LLP, Independent Registered Public\\nAccounting Firm. Management has made available to Ernst & Young LLP all of AT&T’s financial records and related data,as well as the minutes of stockholders’ and directors’ meetings. Furthermore, management believes that allrepresentations made to Ernst & Young LLP during its audit were valid and appropriate.\\nManagement maintains disclosure controls and procedures that are designed to ensure that information required to be\\ndisclosed by AT&T is recorded, processed, summarized, accumulated and communicated to its management, includingits principal executive and principal financial officers, to allow timely decisions regarding required disclosure, andreported within the time periods specified by the Securities and Exchange Commission’s rules and forms.\\nManagement also seeks to ensure the objectivity and integrity of its financial data by the careful selection of its\\nmanagers, by organizational arrangements that provide an appropriate division of responsibility and by communicationprograms aimed at ensuring that its policies, standards and managerial authorities are understood throughout theorganization.\\nThe Audit Committee of the Board of Directors meets periodically with management, the internal auditors and the\\nindependent auditors to review the manner in which they are performing their respective responsibilities and to discussauditing, internal accounting controls and financial reporting matters. Both the internal auditors and the independentauditors periodically meet alone with the Audit Committee and have access to the Audit Committee at any time.\\nAssessment of Internal ControlThe management of AT&T is responsible for establishing and maintaining adequate internal control over financial\\nreporting, as defined in Rule 13a-15(f) or 15d-15(f) under the Securities Exchange Act of 1934. AT&T’s internal controlsystem was designed to provide reasonable assurance to the company’s management and Board of Directors regardingthe preparation and fair presentation of published financial statements.\\nAT&T management assessed the effectiveness of the company’s internal control over financial reporting as of\\nDecember 31, 2022. In making this assessment, it used the criteria set forth by the Committee of SponsoringOrganizations of the Treadway Commission (COSO) in Internal Control – Integrated Framework (2013 framework). Based\\non its assessment, AT&T management believes that, as of December 31, 2022, the company’s internal control overfinancial reporting is effective based on those criteria.\\nErnst & Young LLP, the independent registered public accounting firm that audited the financial statements included in\\nthis Annual Report, has issued an attestation report on the company’s internal control over financial reporting.\\nJohn T. Stankey\\nChief Executive Officer and PresidentPascal Desroches\\nSenior Executive Vice President and Chief Financial OfficerReport of Management\\n!\\x08\\n',\n", " 'To the Stockholders and the Board of Directors of AT&T Inc.\\nOpinion on the Financial StatementsWe have audited the accompanying consolidated balance sheets of AT&T Inc. (the Company) as of December 31, 2022\\nand 2021, the related consolidated statements of income, comprehensive income, cash flows and changes instockholders’ equity for each of the three years in the period ended December 31, 2022, and the related notes andfinancial statement schedule listed in Item 15(a) (collectively referred to as the “consolidated financial statements”). Inour opinion, the consolidated financial statements present fairly, in all material respects, the financial position of theCompany at December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years inthe period ended December 31, 2022, in conformity with U.S. generally accepted accounting principles.\\nWe also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United\\nStates) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2022, based on criteriaestablished in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of theTreadway Commission (2013 framework) and our report dated February 13, 2023 expressed an unqualified opinionthereon.\\nBasis for OpinionThese financial statements are the responsibility of the Company’s management. Our responsibility is to express an\\nopinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with thePCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securitieslaws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\\nWe conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and\\nperform the audit to obtain reasonable assurance about whether the financial statements are free of materialmisstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of materialmisstatement of the financial statements, whether due to error or fraud, and performing procedures that respond tothose risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in thefinancial statements. Our audits also included evaluating the accounting principles used and significant estimates madeby management, as well as evaluating the overall presentation of the financial statements. We believe that our auditsprovide a reasonable basis for our opinion.\\nCritical Audit MattersThe critical audit matters communicated below are matters arising from the current period audit of the financial\\nstatements that were communicated or required to be communicated to the audit committee and that: (1) relate toaccounts or disclosures that are material to the financial statements and (2) involved our especially challenging,subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion onthe consolidated\\nfinancial statements, taken as a whole, and we are not, by communicating the critical audit matters\\nbelow, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.\\nDiscount rates used in determining pension and postretirement benefit obligations\\nDescription of\\nthe MatterAt December 31, 2022, the Company’s defined benefit pension obligation was $42,828 million and\\nexceeded the fair value of pension plan assets of $40,874 million, resulting in an unfunded benefitobligation of $1,954 million. Additionally, at December 31, 2022, the Company’s postretirement benefitobligation was $7,280 million and exceeded the fair value of postretirement plan assets of $2,160million, resulting in an unfunded benefit obligation of $5,120 million. As explained in Note 14 to theconsolidated financial statements, the Company updates the assumptions used to measure the definedbenefit pension and postretirement benefit obligations, including discount rates, at December 31 orupon a remeasurement event. The Company determines the discount rates used to measure theobligations based on the development of a yield curve using high-quality corporate bonds selected toyield cash flows that correspond to the expected timing and amount of the expected future benefitpayments.\\nAuditing the defined benefit pension and postretirement benefit obligations was complex due to the\\njudgmental nature of the actuarial assumptions made by management, primarily the discount rate,used in the Company’s measurement process. The discount rate has a significant effect on themeasurement of the defined benefit pension and postretirement benefit obligations, and auditing thediscount rate was complex because it required an evaluation of the credit quality of the corporatebonds used to develop the discount rate and the correlation of those bonds’ cash inflows to the timingand amount of future expected benefit payments.Report of Independent Registered Public Accounting Firm\\n!\\t',\n", " 'How We\\nAddressed theMatter in OurAuditWe obtained an understanding, evaluated the design and tested the operating effectiveness of certain\\ncontrols over management’s review of the determination of the discount rates used in the definedbenefit pension and postretirement benefit obligations calculations.\\nTo test the determination of the discount rate used in the calculation of the defined benefit pension\\nand postretirement benefit obligations, we performed audit procedures that focused on evaluating,with the assistance of our actuarial specialists, the determination of the discount rates, among otherprocedures. For example, we evaluated the selected yield curve used to determine the discount ratesapplied in measuring the defined benefit pension and postretirement benefit obligations. As part of thisassessment, we considered the credit quality of the corporate bonds that comprised the yield curveand compared the timing and amount of cash flows at maturity with the expected amounts andduration of the related benefit payments.\\nEvaluation of goodwill for impairment\\nDescription of\\nthe MatterAt December 31, 2022, the Company’s goodwill balance was $67,895 million. As discussed in Note 1 to\\nthe consolidated financial statements, reporting unit goodwill is tested at least annually forimpairment. Estimating fair values in connection with these impairment evaluations involves theutilization of discounted cash flow and market multiple approaches. As described in Note 9 to theconsolidated financial statements, impairment charges of $13,478 million in the Business Wirelinereporting unit, $10,508 million in the Consumer Wireline reporting unit and $826 million in the Mexicoreporting unit were recorded during the year.\\nAuditing management’s annual goodwill impairment test for the Consumer Wireline and Business\\nWireline reporting units was complex because the estimation of fair values involves subjectivemanagement assumptions, such as projected terminal growth rates, projected long-term EBITDAmargins, and weighted average cost of capital, and complex valuation methodologies, such as thediscounted cash flow and market multiple approaches. Assumptions used in these valuation models areforward-looking, and changes in these assumptions can have a material effect on the determination offair value.\\nHow We\\nAddressed theMatter in OurAuditWe obtained an understanding, evaluated the design and tested the operating effectiveness of certain\\ncontrols over the Company’s impairment evaluation processes. Our procedures included testingcontrols over management’s review of the valuation models and its determination of the significantassum\\nptions described above.\\nOur audit procedures to test management’s impairment evaluations included, among others, assessing\\nthe valuation methodologies and significant assumptions discussed above and the underlying dataused to develop such assumptions. For example, we compared the significant assumptions to currentindustry, market and economic trends, and other guideline companies in the same industry. Whereappropriate, we evaluated whether changes to the Company’s business and other factors would affectthe significant assumptions. We also assessed the historical accuracy of management’s estimates andperformed independent sensitivity analyses. We involved our valuation specialists to assist us inevaluating the methodologies and auditing the assumptions used to calculate the estimated fair valuesof the Company’s reporting units.\\nWe have served as the Company’s auditor since 1999.\\nDallas, Texas\\nFebruary 13, 2023Report of Independent Registered Public Accounting Firm (continued)\\n! \\n',\n", " 'To the Stockholders and the Board of Directors of AT&T Inc.\\nOpinion on Internal Control Over Financial Reporting\\nWe have audited AT&T Inc.’s internal control over financial reporting as of December 31, 2022, based on criteria\\nestablished in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of theTreadway Commission (2013 framework) (the COSO criteria). In our opinion, AT&T Inc. (the Company) maintained, in allmaterial respects, effective internal control over financial reporting as of December 31, 2022, based on the COSO criteria.\\nWe also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United\\nStates) (PCAOB), the 2022 consolidated financial statements of the Company and our report dated February 13, 2023expressed an unqualified opinion thereon.\\nBasis for OpinionThe Company’s management is responsible for maintaining effective internal control over financial reporting and for its\\nassessment of the effectiveness of internal control over financial reporting included in the accompanying Report ofManagement. Our responsibility is to express an opinion on the Company’s internal control over financial reporting basedon our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respectto the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of theSecurities and Exchange Commission and the PCAOB.\\nWe conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and\\nperform the audit to obtain reasonable assurance about whether effective internal control over financial reporting wasmaintained in all material respects.\\nOur audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a\\nmaterial weakness exists, testing and evaluating the design and operating effectiveness of internal control based on theassessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe thatour audit provides a reasonable basis for our opinion.\\nDefinition and Limitations of Internal Control Over Financial ReportingA company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding\\nthe reliability of financial reporting and the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company’s internal control over financial reporting includes those policiesand procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions arerecorded as necessary to permit preparation of financial statements in accordance with generally accepted accountingprinciples, and that receipts and expenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect onthe financial statements.\\nBecause of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.\\nAlso, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may becomeinadequate because of changes in conditions, or that the degree of compliance with the policies or procedures maydeteriorate.\\nDallas, Texas\\nFebruary 13, 2023Report of Independent Registered Public Accounting Firm\\n!.\\n',\n", " '84References\\n4Coverage not available everywhere. Based upon AT&T analysis of\\nthird-party data.\\n5Based on fiber to the home households using the latest publicly\\navailable data.\\n6https://ntia.gov/category/data-central1Net Debt of $132.2 billion at December 31, 2022 is calculated as TotalDebt of $135.9 billion less Cash and Cash Equivalents of $3.7 billion.Net Debt of $156.4 billion at December 31, 2021 is calculated as TotalDebt of $175.6 billion less Cash and Cash Equivalents of $19.2 billion.\\n2Wireless EBITDA is the same as Mobility EBITDA. EBITDA is operatingincome before depreciation and amortization.\\n3Based on overall covera ge in the U.S. Cove rage not available everywhere.',\n", " '85Committees of the Board:\\n(1) Audit(2) Corporate Development and Finance(3) Executive(4) Governance and Policy(5) Human Resources\\n(Information is provided\\nas of February 13, 2023.)\\nWilliam E. Kennard, 66(3,4)\\nIndependent Chairman of the Board\\nFormer U.S. Ambassador to the\\nEuropean Union\\nFormer Chairman of the Federal\\nCommunications Commission\\nDirector since 2014Background: Law,\\ntelecommunications,\\npublic policy\\nStephen J. Luczo, 65\\n(1,2)\\nManaging Partner\\nCrosspoint Capital Partners, L.P.Director since 2019Background: Technology, finance,\\noperations management\\nMatthew K. Rose, 63\\n(2,5)\\nRetired Chairman\\nand Chief Executive O fficer\\nBurlington Northern Santa Fe, LLCDirector since 2010Background: Freight transport\\nLuis A. Ubiñas, 60\\n(1,4)\\nChairman\\nThe Statue of Liberty –\\nEllis Island Foundation\\nDirector since June 2021Background: Telecommunications,\\ngovernment, nonpro fitsMichael B. McCallister, 70\\n(1,5)\\nRetired Chairman of the Board\\nand Chief Executive O fficer\\nHumana Inc.Director since 2013Background: Health care\\nJohn Stankey, 60\\nChief Executive O fficer and President\\nAT&T Inc.Director since 2020Background: Telecommunications,\\ntechnologyGlenn H. Hutchins, 67\\n(2,3,4)\\nChairman\\nNorth Island and North Island VenturesCo-FounderSilver LakeDirector since 2014Background: Technology, public policy\\nBeth E. Mooney, 68\\n(3,4,5)\\nRetired Chairman\\nand Chief Executive O fficer\\nKeyCorpDirector since 2013Background: Banking\\nCynthia B. Taylor, 61\\n(1,3)\\nPresident and Chief Executive\\nOfficer\\nOil States International, Inc.Director since 2013Background: Public accounting,\\noil and gas\\nAT&T Inc. Board of Directors\\nScott T. Ford, 60(2,3,5)\\nChief Executive O fficer\\nWestrock Co ffee Company\\nDirector since 2012Background: Telecommunications\\n',\n", " '86(Information is provided\\nas of February 13, 2023.)Executive O fficers of AT&T Inc. and Its A ffiliates\\nJohn Stankey, 60\\nChief Executive O fficer\\nand President\\nEd Gillespie, 61\\nSenior Executive Vice President –\\nExternal and Legislative A ffairs\\nAT&T Services, Inc.\\nLori Lee, 57\\nGlobal Marketing O fficer and\\nSenior Executive Vice President –InternationalThaddeus Arroyo, 59\\nChief Strategy\\nand Development O fficer\\nDavid Huntley, 64\\nSenior Executive Vice President\\nand Chief Compliance O fficer\\nJeremy Legg, 53\\nChief Technology O fficer\\nAT&T Services, Inc.Pascal Desroches, 58\\nSenior Executive Vice President\\nand Chief Financial O fficer\\nKellyn Smith Kenny, 45\\nChief Marketing\\nand Growth O fficer\\nDavid McAtee II, 54\\nSenior Executive Vice President\\nand General Counsel\\nJeffMcElfresh, 52\\nChief Operating O fficerAngela Santone, 51\\nSenior Executive Vice President –\\nHuman Resources\\n',\n", " '[This page intentionally le ftblank.]',\n", " '[This page intentionally le ftblank.]',\n", " '© 2023 AT&T Intellectual Property. AT&T and the globe logo are registered trademarks and service marks of AT&T \\n\\x03 ¢ÁǸ¿¿¸¶ÇÈ´¿\\x03©ÅÂøÅÇÌ\\x03´Á·\\x8dÂÅ\\x03\\x9a\\xad\\x86\\xad\\x03´ï¿¼´Ç¸·\\x03¶ÂÀôÁ¼¸Æ\\x04\\x03\\x9f¼ÅÆǧ¸Ç\\x03´Á·\\x03Ç»¸\\x03\\x9f¼ÅÆǧ¸Ç\\x03¿ÂºÂ\\x03´Å¸\\x03Ÿº¼ÆǸŸ·\\x03ÇÅ´·¸À´Å¾Æ\\x03´Á·\\x03\\x03\\n\\x03 ƸÅɼ¶¸\\x03À´Å¾Æ\\x03¹\\x03Ç»¸\\x03\\x9f¼ÅÆÇ\\x03«¸ÆÃÂÁ·¸Å\\x03§¸ÇÊž\\x03\\x9aÈǻ¿ÇÌ\\x04\\x03\\x9a¿¿\\x03ÂÇ»¸Å\\x03À´Å¾Æ\\x03´Å¸\\x03Ç»¸\\x03ÃÅÂøÅÇÌ\\x03¹\\x03Ç»¸¼Å\\x03ŸÆø¶Ç¼É¸\\x03ÂÊÁ¸ÅÆ\\x04\\n\\x03\\x03\\x03\\x03\\x9aÁÁÈ´¿\\x03«¸ÃÂÅÇ\\x03ÃżÁǸ·\\x03ÂÁ\\x03ôøÅ\\x03¶ÂÁÇ´¼Á¼Áº\\x03\\x1d\\x1cY\\x03ÃÂÆÇ\\x88¶ÂÁÆÈÀ¸Å\\x03Ÿ¶Ì¶¿¸·\\x03¶ÂÁǸÁÇ\\x03Toll-Free Stockholder Hotline \\nCall us at 1-800-35 1-7221 between 8 a.m. and \\n#\\x03Ã\\x04À\\x04\\x03\\x9c¸ÁÇÅ´¿\\x03\\xad¼À¸\\x06\\x03¦ÂÁ·´Ì\\x03Ç»ÅÂȺ»\\x03\\x9fż·´Ì \\n(TDD 1-888-403-9700) for help with: \\n•Common stock account inquiries\\n•\\x03 «¸ÄȸÆÇÆ\\x03¹ÂÅ\\x03´ÆƼÆÇ´Á¶¸\\x03ʼǻ\\x03ÌÂÈÅ\\x03¶ÂÀÀÂÁ\\x03\\x03\\nstock account, including stock transfers\\n•\\x03 ¢Á¹ÂÅÀ´Ç¼ÂÁ\\x03ÂÁ\\x03\\xad»¸\\x03\\x9d¼Å¸¶Ç¬\\x9e«¯¢\\x9c\\x9eÎ\\x03¢ÁɸÆÇÀ¸ÁÇ\\x03\\x03\\nProgram for Stockholders of AT&T Inc. (sponsored \\n and administered by Computershare Trust \\n\\x03\\x03\\x03\\x03\\x9cÂÀôÁÌ\\x06\\x03§\\x04\\x9a\\x04\\x8c\\nWritten Stockholder Requests \\nPlease mail all account inquiries and other requests \\nf\\nor assistance regarding your stock ownership to:\\nAT&T Inc. \\nc/o Computershare Trust \\x03 \\x9cÂÀôÁÌ\\x06\\x03§\\x04\\x9a\\x04 \\nP .O. Box 43078 \\n©ÅÂɼ·¸Á¶¸\\x06\\x03«¢\\x03\\x1c\\x1e% \\x1c\\x88\\x1f\\x1c#$ \\nYou may also reach the transfer agent for AT&T Inc. \\nat att@computershare.com or visit the website at \\ncomputershare.com/att\\nDirectSERVICE Investment Program \\n\\xad»¸\\x03\\x9d¼Å¸¶Ç¬\\x9e«¯¢\\x9c\\x9e\\x03¢ÁɸÆÇÀ¸ÁÇ\\x03©ÅºŴÀ \\nf\\nor Stockholders of AT&T Inc. is sponsored and \\nadministered by Computershare Trust Company, \\n§\\x04\\x9a\\x04\\x03\\xad»¸\\x03ÃźŴÀ\\x03´¿¿ÂÊÆ\\x03¶ÈÅŸÁÇ\\x03ÆǶ¾»Â¿·¸ÅÆ to reinvest dividends or purchase additional \\x9a\\xad\\x86\\xad\\x03¢Á¶\\x04\\x03ÆǶ¾\\x04\\x03\\x9fÂÅ\\x03ÀŸ\\x03¼Á¹ÂÅÀ´Ç¼ÂÁ\\x06\\x03¶´¿¿ \\n1-800-351-7221Stock Trading Information \\n\\x9a\\xad\\x86\\xad\\x03¢Á¶\\x04\\x03¼Æ\\x03¿¼ÆǸ·\\x03ÂÁ\\x03Ç»¸\\x03§¸Ê\\x03²Âž\\x03¬Ç¶¾\\x03\\x9e˶»´Áº¸\\x04\\x03Tick\\ner symbol: T\\nInformation on the Internet Information about AT&T Inc. is available on the int\\nernet at about.att.com\\nAnnual Meeting The 2023 Annual Meeting of Stockholders of AT&T Inc. will be c\\nonducted virtually on the internet at 3:30 p.m. \\n\\x9c¸ÁÇÅ´¿\\x03\\xad¼À¸\\x06\\x03\\xad»ÈÅÆ·´Ì\\x06\\x03¦´Ì\\x03\\x1d$\\x06\\x03\\x1e\\x1c\\x1e\\x1f\\x04\\x03\\xad»¸Å¸\\x03ʼ¿¿\\x03µ¸ \\nÁÂ\\x03¼Á\\x88øÅÆÂÁ\\x03À¸¸Ç¼Áº\\x04\\x03\\xad»¸\\x03À¸¸Ç¼Áº\\x03ʼ¿¿\\x03µ¸\\x03´¶¶¸ÆƼµ¿¸ \\nat meetnow.global/ATT2023\\nSEC Filings \\nAT&T Inc.’s U.S. Securities and Exchange \\x9cÂÀÀ¼ÆƼÂÁ\\x03迼ÁºÆ\\x06\\x03¼Á¶¿È·¼Áº\\x03Ç»¸\\x03¿´Ç\\n¸ÆÇ\\x03\\x1d\\x1c\\x88¤ \\nand proxy statement, are available on our website at investors.att.com\\nInvestor Relations \\nSecurities analysts and other members of the ÃÅ\\n¹¸ÆƼÂÁ´¿\\x03èÁ´Á¶¼´¿\\x03¶ÂÀÀÈÁ¼ÇÌ\\x03À´Ì\\x03¶ÂÁÇ´¶Ç \\nÇ»¸\\x03¢ÁɸÆÇÂÅ\\x03«¸¿´Ç¼ÂÁÆ\\x03ÆÇ´æ\\x03´Æ\\x03¿¼ÆǸ·\\x03ÂÁ\\x03ÂÈÅ website at investors.att.com\\nIndependent Auditor \\nErnst & Y \\noung LLP \\n\\x1e\\x1f\\x1e\\x1f\\x03¯¼¶ÇÂÅÌ\\x03\\x9aɸ\\x04\\x06\\x03¬È¼Ç¸\\x03\\x1e\\x1c\\x1c\\x1c \\n\\x9d´¿¿´Æ\\x06\\x03\\xad±\\x03#!\\x1e\\x1d%\\n\\x9cÂÅÃÂŴǸ\\x03¨ï¶¸Æ\\x03´Á·\\x03§ÂÁ\\x88¬Ç¶¾»Â¿·¸Å\\x03¢ÁÄȼż¸Æ \\nAT&T Inc. 208 S\\n. Akard St. \\nDallas, TX 75202 \\x1e\\x1d\\x1c\\x88$\\x1e\\x1d\\x88 \\x1d\\x1c!Stockholder Information\\nF1157donD1R1.indd 4-6 3/7/23 5:15 PM',\n", " 'F1157donD1R1.indd 1-3 3/2/23 12:50 PM208 S. Akard St., Dallas, TX 75202'],\n", " 'ATT_CompanyReport_Annual_20230126.pdf': ['Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 1 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nMichael Hodel\\nDirector\\nMorningstar\\n+1 (312) 696-6578\\nmichael.hodel@morningstar.com\\nContents\\nAnalyst Note (25 Jan 2023)\\nBusiness Description\\nBusiness Strategy & Outlook (25 Jan 2023)\\nBulls Say / Bears Say (26 Jan 2023)\\nFair Value and Profit Drivers (26 Jan 2023)\\nEconomic Moat (25 Jan 2023)\\nMoat Trend (25 Jan 2023)\\nRisk and Uncertainty (30 Sep 2022)\\nFinancial Strength (26 Jan 2023)\\nCapital Allocation (30 Sep 2022)\\nFinancials\\nRecent Analyst Notes\\nResearch Methodology for Valuing \\nCompanies\\nImportant Disclosure\\nThe conduct of Morningstar’s analysts is governed by Code of \\nEthics/Code of Conduct Policy, Personal Security Trading Policy \\n(or an equivalent of), and Investment Research Policy. For \\ninformation regarding conflicts of interest, please visit: http://\\nglobal.morningstar.com/equitydisclosures.\\nThe primary analyst covering this company does not own its \\nstock.\\nReporting Currency: USD | Trading Currency: USD\\nCurrency amounts expressed with \"$\" are in U.S. dollars \\n(USD) unless otherwise denoted.\\n1The ESG Risk Rating Assessment is a representation of \\nSustainalytics’ ESG Risk Rating.Competitors Slowed AT&T During Fourth Quarter, but Growth \\nRemains Solid \\nAnalyst Note Michael Hodel, Director, 25 Jan 2023\\nAT&T isn’t attracting as many wireless customers as it was a year ago, but it continues to post solid results. \\nCustomer retention was strong, but Verizon and T-Mobile seem to have effectively countered AT&T’s promotional \\nefforts, which began in earnest about two years ago. Management expects wireless customer additions will \\ndecline in 2023 as industry growth slows from the torrid pace of the past couple years, which will benefit cash \\nflow, but the firm also signaled that it will work to continue gaining share. We are maintaining our $25 fair value \\nestimate and think the stock remains modestly undervalued.\\n \\nAT&T added 656,000 postpaid phone customers during the fourth quarter, down from 884,000 a year ago and \\nplacing it between T-Mobile (927,000 net additions) and Verizon (217,000). The rate of customer defections \\n(churn) was flat versus the prior quarter, bucking the usual seasonal uptick as the impact of price increases taken \\nover the summer appears to have run its course. On the weak side, however, the firm’s share of new customer \\ndecisions (gross customer additions) dipped during the quarter. Of the big three carriers, only AT&T attracted \\nfewer gross additions than in the prior quarter.\\n \\nWireless service revenue increased 5.2% versus the prior year during the quarter. AT&T’s postpaid phone \\ncustomer base has grown 3.5% over the past year and revenue per customer was 2.5% higher. The slowdown in \\ncustomer additions and a slower customer upgrade pace pulled equipment revenue lower but provided a lift to \\nprofitability. The wireless segment EBITDA margin increased nearly 3 percentage points versus a year ago to \\n38%.\\nFinancial Summary and Key Statistics \\nActual Forecast\\n2021 2022 2023 2024\\nRevenue (USD Mil) 118,208 120,741 121,939 124,557\\nRevenue Growth % 4.4 2.1 1.0 2.2\\nOperating Income (Mil) 22,116 22,911 25,381 26,565\\nOperating Margin % 18.7 19.0 20.8 21.3\\nAdjusted EBITDA (Mil) 39,849 13,434 42,956 44,640\\nAdjusted EBITDA Margin % 33.7 11.1 35.2 35.8\\nEarnings Per Share (Diluted) (USD) 3.01 -1.15 2.59 2.63\\nAdjusted Earnings Per Share (Diluted) (USD) 3.01 2.41 2.87 2.95\\nAdjusted EPS Growth % 91.5 -19.8 18.8 2.8\\nPrice/Earnings 6.2 7.6 7.1 6.9\\nPrice/Book 1.8 1.4 1.4 1.2\\nEV/EBITDA 9.4 26.5 6.9 6.6\\nFree Cash Flow Yield % 12.4 9.2 10.7 12.2\\nSource: Morningstar Valuation Model. Data as of 25 Jan 2023.',\n", " \"Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 2 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\n \\nFree cash flow hit $14.1 billion for the year, modestly topping management’s revised target, which it cut from $16 \\nbillion over the summer. AT&T expects to generate $16 billion of free cash flow in 2023 while it continues to \\ninvest aggressively in its network but with slower customer growth easing working capital needs.\\nConsumer fixed-line revenue increased 2.2% year over year with broadband sales up 6.4%. Broadband net \\ncustomer losses were modestly disappointing at 64,000, up from 20,000 a year ago despite continued expansion \\nof the fiber footprint. We expect AT&T to add net broadband customers in 2023 as a growing portion of \\ncustomers are on the fiber network. Broadband pricing remains solid, as average revenue per fiber customer \\nincreased 9% versus a year ago to nearly $65 per month. EBITDA margins in this segment also continue to \\nexpand nicely, hitting 37% during the quarter, up from 31% a year ago.\\n \\nManagement dialed back fiber network expansion plans somewhat, claiming it will build to around 2.0 million-\\n2.5 million new customer locations annually through 2025, down from 3.5 million-4.0 million targeted previously \\nand around 3 million built in 2022. The firm still plans to reach 30 million customer locations, though this figure \\nincludes both homes and businesses. AT&T is excited about its venture with BlackRock to build fiber networks \\noutside of the traditional AT&T footprint and the prospects for winning government subsidies to build in rural \\nareas, stating that it will invest capital in whichever format proves the most profitable. We agree that the firm \\nshould explore all options on the table, but we aren’t clear yet why management is slowing the pace of the core \\nnetwork buildout.\\nBusiness Strategy & Outlook Michael Hodel, Director, 25 Jan 2023\\nWe believe AT&T's strategy to invest heavily in its networks makes sense and will serve investors well over the \\nlong term. Aggressively extending fiber and 5G coverage to more locations builds on its core assets—its existing \\nnetwork and customer relationships—and should allow AT&T to gradually expand its share of telecom spending. \\nAT&T is the third-largest wireless carrier in the United States, but we believe it has adequate scale, spectrum, \\nand financial resources relative to both Verizon and T-Mobile to generate solid profitability. Also, we believe the \\nindustry’s structure has improved in recent years, with three major players that have little incentive to price \\nirrationally in search of short-term market share gains. We expect the industry will gradually reach competitive \\nbalance as each carrier deploys 5G technology on deep midband spectrum holdings and crafts pricing strategies \\nthat appeal to each market segment.\\nUpstart Dish Network could present challenges in some areas, but we don’t believe it presents a credible threat \\nto the traditional wireless business. Also, AT&T and Dish have a wholesale relationship that should allow AT&T to \\nparticipate in Dish's growth. We expect Dish will focus on emerging wireless applications in the enterprise \\nmarket, an area where AT&T also has a strong presence.\\nAT&T also benefits from its ownership of deep network infrastructure across much of the U.S. and its ability to \\nprovide a range of telecom services. The firm plans to extend fiber to 30 million homes and businesses by the end Sector Industry\\ni Communication \\nServicesTelecom Services\\nBusiness Description\\nThe wireless business contributes about two \\nthirds of AT&T’s revenue following the \\nspinoff of WarnerMedia. The firm is the \\nthird-largest U.S. wireless carrier, connecting \\n69 million postpaid and 18 million prepaid \\nphone customers. Fixed-line enterprise \\nservices, which account for about 20% of \\nrevenue, include internet access, private \\nnetworking, security, voice, and wholesale \\nnetwork capacity. Residential fixed-line \\nservices, about 10% of revenue, primarily \\nconsist of broadband internet access service. \\nAT&T also has a sizable presence in Mexico, \\nserving 21 million customers, but this \\nbusiness only accounts for 2% of revenue. \\nThe firm still holds a 70% equity stake in \\nsatellite television provider DirecTV but does \\nnot consolidate this business in its financial \\nstatements.\",\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 3 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nof 2025, up from 22 million today, and has form a joint venture with BlackRock to expand into new areas. These \\nefforts should allow the company to serve these locations extremely well while also enhancing wireless coverage \\nin the surrounding areas. If the firm hits its targets, it would be the third-largest high-quality fixed-line network in \\nthe U.S. (behind Comcast and Charter) and the only of the three to also own a nationwide wireless network. We \\nexpect AT&T will have the ability to use its combined wireless and fixed-line capabilities to grab market share in \\nthis large and growing territory over the next decade.\\nBulls Say Michael Hodel, Director, 26 Jan 2023\\nuFollowing a period of investment, AT&T will hold a nationwide 5G wireless network with deep spectrum behind it \\nand a fiber network capable of reaching nearly one fourth of the U.S.\\nuAT&T has the scale to remain a strong wireless competitor over the long term. With three dominant carriers, \\nindustry pricing should be more rational going forward.\\nuCombining wireless and fixed-line networks with new technologies and deep expertise makes AT&T a force in \\nenterprise services. \\nBears Say Michael Hodel, Director, 26 Jan 2023\\nuThe cost of maintaining dominance in the wireless industry by controlling spectrum has been exceptionally high \\nover the years. AT&T has spent $40 billion over the past three years for licenses with few prospects for \\nincremental revenue.\\nuAdvancing technology will eventually swamp AT&T’s wireless business, enabling a host of firms to enter the \\nmarket, further commoditizing this service.\\nuAT&T’s massive debt load will catch up with it. Even after spinning off Warner with a huge amount of debt, AT&T \\ncarries far higher leverage than it has historically and its dividend payout remains high. \\nFair Value and Profit Drivers Michael Hodel, Director, 26 Jan 2023\\nOur $25 fair value estimate assumes that AT&T will deliver modest revenue growth and gradually expanding \\nmargins over the next several years as its wireless and fiber network investments pay off. Our fair value estimate \\nimplies an enterprise value of 8.0 times our 2023 EBITDA estimate and an 8% free cash flow yield. \\nIn wireless, we expect AT&T will slowly gain market share as it re-establishes its market position. We believe \\npostpaid revenue per phone customer will grow modestly amid a relatively stable competitive environment, \\nhitting $60 per month in 2027 versus $55 in 2022. We estimate AT&T generates around $1 billion in revenue \\nannually from connected devices, such as cars. We model this revenue roughly doubling over the next five years \\nas things like edge computing gain adoption, but this estimate is highly uncertain. In total, we expect wireless \\nservice revenue will increase 3%-4% annually on average through 2027, with wireless EBITDA margins holding in \\nthe low-40% range, as cost efficiency efforts and benefits from slower customer growth offset rising network \\noperating costs. \\nWe expect the consumer broadband business will deliver steadily improving growth as the fiber network build \\nout matures. We believe this business has an opportunity to sharply increase margins over the next five years as ',\n", " \"Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 4 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\npenetration rates increase and the old copper network is decommissioned. We model a 39% segment EBITDA \\nmargin in 2027, but this could prove conservative if legacy costs decline precipitously, especially given the \\nabsence of television content costs. Cable rivals that don’t have sizable television revenue, like Cable One, can \\ngenerate EBITDA margins above 50%. \\nWe expect the enterprise services business will gradually return to growth in the coming years with profitability \\nholding steady as cost-cutting balances the loss of higher-margin legacy services. AT&T hasn’t provided much \\ndetail surrounding the enterprise business, making it more difficult to forecast future results. The firm has said \\npreviously that EBITDA in this segment will likely decline steadily until sometime in 2024. We suspect a large \\nportion of the enterprise business will look similar to the consumer fixed-line business over the longer term, \\nprimarily providing basic connectivity and earning attractive margins. That said, AT&T should benefit as fixed-line \\nand wireless services converge, providing opportunities to create, deliver, and manage more complex offerings. \\nIn total, we believe consolidated revenue can grow 2-3% annually over the next five years. We expect capital \\nspending will roughly match management’s current plan in 2023 (around $24 billion, including vendor financing \\npayments) to support the fiber network upgrade and 5G deployment. The firm expects capital spending will \\ndecline sharply beyond 2023 but hasn’t provided a budget, likely to maintain flexibility to pursue growth \\nopportunities. We expect wireless network spending will decline in 2024 and beyond but that the firm will \\ncontinue investing heavily in fiber, holding total capital spending around $22 billion annually through 2027. \\nEconomic Moat Michael Hodel, Director, 25 Jan 2023\\nWireless is AT&T's most important business. Returns on capital in wireless have eroded somewhat in recent years \\nas the firm has spent heavily on wireless spectrum and invested to put that spectrum to use. We estimate the \\nwireless business produced a return on capital in 2022 of roughly 8%, or about 10% excluding goodwill, modestly \\nabove our estimate of the firm’s cost of capital. These figures are down from about 10% and 12% in 2018. Over \\nthose four years, segment operating income is up 13% cumulatively while the invested capital base has \\nexpanded about 30%, primarily on $40 billion of spectrum purchases. \\nWe expect that wireless returns will remain ahead of AT&T’s cost of capital. Verizon, AT&T, and T-Mobile \\ndominate the U.S. wireless market, collectively claiming nearly 90% of retail postpaid and prepaid phone \\ncustomers between them and supplying the network capacity to support most other players. Providing solid \\nnationwide coverage requires heavy fixed investments in wireless spectrum and network infrastructure. While a \\nlarger customer base does require incremental investment in network capacity, a significant portion of costs are \\neither fixed or more efficiently absorbed as network utilization reaches optimal levels in more locations. \\nThe benefits of fixed-cost leverage and the difficulty of providing a differentiated wireless offering create an \\nefficient scale advantage in the wireless industry. The massive consolidation across the industry over the past 15 \\nyears and the inability of several interested parties, including Dish Network and Comcast, to enter the market \\nusing their own networks provide evidence of efficient scale. Comcast relies on Verizon to support its wireless \\nefforts while Dish will use both the AT&T and T-Mobile networks for several years as it attempts to build a \",\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 5 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nnationwide network, more than a decade after it began assembling a spectrum portfolio. \\nWith three sizable players, we don’t expect the carriers will have an incentive to aggressively poach each other’s \\ncustomers, given how painfully slow market share shifts occur in the business. We also expect the high cost of \\nmaintaining nationwide coverage and its diminutive size will limit Dish’s ability to compete on a large scale in the \\ntraditional wireless business over the long term. Each of the three major carriers has pledged substantial capital \\nreturns to shareholders: AT&T’s new dividend totals $8 billion annually and Verizon’s nearly $11 billion, while T-\\nMobile has said it can repurchase up to $60 billion of its shares through 2025. To support these returns, each of \\nthe carriers has guided investors to expect modest but steady revenue growth over the next several years. These \\nactions indicate that none of the carriers is looking to radically disrupt the current pricing structure in the industry \\nand that each will increase prices as needed to offset any cost pressures that emerge. \\nThe fixed-line enterprise services segment is AT&T’s next largest. We believe this operation holds a solid \\ncompetitive position in a consolidating market. AT&T is one of only a handful of companies capable of providing \\ncomplex communications services to business customers with geographically diverse needs. We roughly estimate \\nthis segment earns 10%-15% returns on invested capital excluding goodwill (AT&T’s most recent major \\nacquisition in this area was the 2005 purchase of the legacy AT&T long-distance business). Business services \\nrevenue has steadily declined in recent years, falling to less than $23 billion in 2022 from $29 billion five years \\nearlier. Margins in this segment have held steady, but profits have also declined (EBITDA was less than $9 billion \\n2022 versus $11 billion in 2017). A significant but undisclosed amount of legacy business remains and will \\ncontinue to exert pressure on growth over the next several years, but AT&T has begun to focus its efforts on core \\nnetwork connectivity and services where its assets allow it to deliver unique solutions. Management expects the \\nsegment will near stability in 2023 with growth returning thereafter. \\nAT&T’s last significant business, consumer fixed-line services, doesn’t possess a moat, in our view. We estimate \\nAT&T’s consumer fixed-line networks reach around 55 million homes, or a bit less than half of the U.S. \\npopulation. This business is challenged competitively across most of this footprint thanks to inferior networks \\nrelative to cable competitors. About 25% of the homes in this service territory subscribe to AT&T’s internet access \\nservice, around half the penetration level Comcast claims. The gap between AT&T and its cable rivals has steadily \\nwidened over the past several years. Customer penetration is critical to driving profitability in the telecom \\nbusiness and AT&T’s modest level has left returns on capital around 5%, by our estimate. \\nAT&T has upgraded about one third of its residential footprint to a fiber-to-the-premises network, which provides \\na much stronger competitive position versus cable. The firm plans to expand the FTTP network aggressively over \\nthe next few years, but it has a long way to go on this effort. We expect price competition will remain rational as \\nAT&T’s fiber network grows, as neither AT&T or the cable companies are likely to risk earning less revenue across \\ntheir existing customer bases over the long term to gain share. \\nThe remainder of AT&T’s business includes the Mexican wireless business. We don’t believe the Mexican \\nbusiness has a moat, operating at a fraction of the scale of market leader America Movil. We wouldn’t be ',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 6 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nsurprised if AT&T sold the Mexican wireless business in the near future.\\nMoat Trend Michael Hodel, Director, 25 Jan 2023\\nWith the T-Mobile/Sprint merger, we expect the wireless industry will begin to benefit from the efficient scale \\nproperties inherent in the business. In other markets around the world, similarly sized competitors typically enjoy \\nbenign competitive environments. Gaining meaningful market share can take months or years of aggressive \\npricing, given how contracts are typically structured, allowing rivals to easily retaliate. Also, we don’t believe Dish \\nNetwork will disrupt the traditional wireless business. The firm has entered the prepaid market, acquiring the \\nSprint prepaid business. However, Dish holds extremely small market share. With a shaky financial position and a \\nnetwork likely better suited to narrow use cases, we don’t believe the firm will make a broad push into the \\ntraditional wireless market.\\nIn the consumer broadband segment, AT&T has steadily lost wallet share across most of the areas it serves, \\nmaking it increasingly difficult to justify the aggressive network spending needed to keep pace with cable rivals \\non a stand-alone basis. However, we think the segment will enjoy significant synergies with the wireless \\nbusiness as 5G technologies are deployed. We like AT&T’s plan to expand its fiber network in residential areas for \\nthis reason. The transition from the legacy copper network to fiber holds the promise to markedly improve AT&T’s \\ncost structure and overall competitive position but not without significant uncertainty. AT&T plans to overlay \\nabout half its footprint with fiber by 2025. Keeping this effort on budget could be challenging given rising labor \\ncosts and potential zoning challenges. The firm also hopes to essentially abandon another 25% of its fixed-line \\nfootprint, offering only wireless in these areas. Getting these plans past regulators and lawmakers could prove \\ndifficult. \\nIn the fixed-line business services segment, AT&T’s position has strengthened in recent years thanks to \\nconsolidation, which has reduced the number of firms capable of delivering complex services to geographically \\ndiverse customers. The cable companies are expanding their capabilities in this market, but we expect these \\nfirms will need many years to replicate the local and global infrastructure needed to serve larger businesses well \\nwhile also earning healthy margins. More importantly, we don’t have good insight in the revenue mix within AT&\\nT business services segment. While the firm is well positioned to offer core network connectivity and network \\nmanagement services, technological advances have rendered several major business lines, including legacy voice \\nservice, obsolete.\\nRisk and Uncertainty Michael Hodel, Director, 30 Sep 2022\\nWe have changed our Morningstar Uncertainty Rating to Medium from High to better reflect the volatility we \\nexpect AT&T investors will face relative to our global coverage. Regulation and technological change are the \\nprimary uncertainties facing AT&T. Wireless and broadband services are often considered necessary for social \\ninclusion, in terms of employment and education. If AT&T’s services are deemed insufficient or overpriced, \\nespecially if in response to weak competition, regulators or politicians could step in. The firm is also still \\nresponsible for providing fixed-line phone services to millions of homes across the U.S., including many in small ',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 7 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\ntowns and rural areas. It could be compelled to invest more in rural markets even if economic returns are \\ninsufficient. \\nRegulators also control the flow of wireless spectrum into the industry, which has created scarcity in the past, \\npushing carriers to pay high prices for licenses. We also suspect when large spectrum blocks are made available, \\nsuch as the 2021 C-band auction, the carriers have felt compelled to bid excessively to keep potential entrants \\nout of the market, especially the cable companies. Regulators around the world have also used spectrum policies \\nto foster additional competition, a strategy the U.S. could follow. \\nOn the technology front, wireless standards continue to evolve, putting more spectrum to use more efficiently. \\nThe cost to deploy wireless networks could come down to the point where numerous new firms are able to enter \\nthe market. The cable companies are already making attempts to leverage their existing networks to provide \\nlimited wireless coverage. Technology could quickly enhance these efforts. While unlikely, in our view, wireless \\ntechnology could also remove the need for AT&T’s fixed-line networks, killing returns on its fiber investments.\\nFinancial Strength Michael Hodel, Director, 26 Jan 2023\\nThe WarnerMedia spinoff took around $35 billion of debt with it, while a $9 billion spectrum purchase in early \\n2022 offset a portion of this benefit. Net debt stood at $132 billion at the end of 2022, leaving net leverage at \\nabout 3.2 times EBITDA. This load is far higher than the firm has operated under in the past: Immediately before \\nits current capital deployment binge began in 2012 (with a round of heavy share repurchases), AT&T typically \\ncarried leverage of around 1.5 times EBITDA. Fortunately, the current debt load still compares reasonably well \\nwith Verizon and T-Mobile, which both carry similar leverage metrics. \\nThe firm also used the Warner spinoff to adjust its dividend policy, targeting a payout of around 40% of free cash \\nflow, down from more than 70% in 2021 (by our calculation). The new payout totals about $8 billion annually, \\ndown from $15 billion in 2021. The firm has fallen short of management’s cash flow targets over the past year, \\nand it now expects to generate $16 billion of free cash flow in 2023, down from an initial projection of $20 billion. \\nWe still think the dividend policy makes sense, leaving substantial excess cash to reduce leverage and make \\nnetwork investments, which we believe is important to AT&T’s long-term health. \\nWith the reduced dividend payout leaving sizable excess cash flow, the firm plans to repay debt. Management \\ntargets net leverage of 2.5 times EBITDA, which it now believes it can hit in early 2025, rather than its initial \\nexpectation of late 2023. We believe the revised timeline is achievable, absent any major capital outlays. These \\ntargets also exclude $5.2 billion of preferred shares, around $5 billion of preferred interests in various \\nsubsidiaries, and a perpetual preferred stake in the wireless business held by AT&T’s pension plans that pays \\n$560 million annually. The firm used $2.7 billion to repurchase a portion of these preferred interests in late 2022. \\nCapital Allocation Michael Hodel, Director, 30 Sep 2022\\nWe believe recent capital allocation decisions have destroyed shareholder value and the firm will pay the price \\nfor these missteps for some time to come. As a result, we assign AT&T a Morningstar Capital Allocation Rating as ',\n", " \"Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 8 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nPoor. This assessment stems from our view that a relatively weak balance sheet has hindered AT&T's strategic \\nflexibility and willingness to invest aggressively in the business when needed. The state of the balance sheet is \\nthe result of several ill-considered acquisitions, poorly timed share repurchases, and an insistence on increasing \\nthe dividend even as leverage mounted. Management is moving in the right direction, using the Warner spinoff \\nto shift to a dividend policy that better supports needed investment, but AT&T is still playing catch-up. It will need \\nto invest aggressively for the next several years to make its fixed-line network competitive, and it doesn’t expect \\nto get debt leverage below targeted levels until the end of 2023. With cash flow expectations coming down \\nrecently, we wouldn't be surprised if management pushes its targeted leverage date further out. \\nThe firm’s run of heavy capital deployment began in 2012 with a massive share-repurchase program that, at the \\ntime, was billed as a temporary move away from AT&T’s 1.5 times net debt/EBITDA leverage target. The firm \\nrepurchased $27 billion of its shares through 2014 at prices per share in the mid-$30s, pushing leverage to 1.8 \\ntimes. The firm then pursued the AWS-3 auction, the DirecTV deal, expansion into Mexico, the Time Warner \\nacquisition, and the recent C-band auction. With leverage nearing 3.2 times EBITDA in early 2021, AT&T’s capital \\nstructure simply didn’t line up well with a large dividend payout. Yet management explicitly expressed support for \\nthe prior dividend until immediately before changing direction, catching long-suffering investors off guard. \\nThese capital forays not only left AT&T with a weaker balance sheet, they also left the firm in a weaker \\ncompetitive position overall, in our view. With 2015’s DirecTV purchase, AT&T acquired a satellite TV business \\nthat was, at best, peaking in maturity. AT&T has sold a stake in the television business but still has exposure to \\nthis declining business. More importantly, as the firm was shifting its strategy, it didn’t invest as aggressively as \\nit should have in its core business. Until recently, it had prioritized short-term margins over maintaining wireless \\nmarket share, allowing T-Mobile to steadily steal customers. In addition, AT&T has only begrudgingly invested to \\nexpand its fiber optic network in the past. New CEO John Stankey has increased investment to retain customers \\nand has made fiber construction a top priority, which should improve AT&T’s position but will also dent cash flow \\nover at least the next couple of years. \\nAT&T has placed a priority on debt reduction since the Time Warner merger closed, using asset sales as a part of \\nthis effort. Not all these sales have made strategic sense, in our view. For example, the sale of its wireless assets \\nin Puerto Rico seemed odd, given the territory’s strong ties to the U.S. and AT&T’s presence elsewhere in Latin \\nAmerica. Management has also been less than forthright, in our view, concerning the debt load, using preferred \\nshares, receivables securitization, and vendor financing to cloud its financial picture. \\nShareholders have suffered because of AT&T’s choices. The stock returned only 2% annually over the 20 years \\nleading up to the Warner spinoff and 3% over the previous decade, as a declining share price has partially offset \\ndividends paid. While the telecom industry hasn’t delivered stellar returns in general, with several firms hitting \\nbankruptcy in recent years, AT&T's shares lagged those of nearly every major U.S. telecom peer over that prior \\ndecade, including Verizon (7% returns annually), Comcast (14%), Charter (23%), and T-Mobile (23%). K\",\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 9 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nPrice vs. Fair Value \\n010203040Fair Value: 25.00\\n11 Apr 2022 03:30, UTC\\nLast Close: 20.42\\nOver Valued\\nUnder Valued\\n2018 2019 2020 2021 2022 YTD\\n0.77 1.06 0.80 0.68 0.74 0.82 Price/Fair Value\\n-21.45 44.08 -21.08 -7.23 -1.33 12.43 Total Return %\\nMorningstar Rating\\nCompetitors\\nAT&T Inc T Comcast Corp Class A CMCSA Verizon Communications Inc VZ T-Mobile US Inc TMUS\\nFair Value\\n25.00\\nUncertainty : Medium\\nLast Close\\n20.42\\nFair Value\\n60.00\\nUncertainty : Medium\\nLast Close\\n40.10\\nFair Value\\n57.00\\nUncertainty : Low\\nLast Close\\n40.33\\nFair Value\\n165.00\\nUncertainty : Medium\\nLast Close\\n148.07\\nEconomic Moat\\n Narrow\\n Wide\\n Narrow\\n Narrow\\nMoat Trend Stable Stable Stable Stable\\nCurrency USD USD USD USD\\nFair Value 25.00 11 Apr 2022 03:30, UTC 60.00 11 Apr 2022 03:30, UTC1 57.00 11 Apr 2022 03:30, UTC2 165.00 11 Apr 2022 03:30, UTC3\\n1-Star Price 33.75 81.00 71.25 222.75\\n5-Star Price 17.50 42.00 45.60 115.50\\nAssessmentUnder Valued 25 Jan 2023 Significantly \\nUndervalued24 Jan \\n2023Significantly \\nUndervalued24 Jan \\n2023Under Valued 24 Jan 2023\\nMorningstar Rating QQQQ25 Jan 2023 22:28, UTC QQQQQ25 Jan 2023 22:28, UTC QQQQQ25 Jan 2023 22:28, UTC QQQQ25 Jan 2023 22:28, UTC\\nAnalyst Michael Hodel, Director Michael Hodel, Director Michael Hodel, Director Michael Hodel, Director\\nCapital Allocation Poor Standard Standard Standard\\nPrice/Fair Value 0.82 0.67 0.71 0.90\\nPrice/Sales 0.90 1.48 1.24 2.29\\nPrice/Book 1.12 2.14 1.86 2.59\\nPrice/Earnings 7.92 33.69 7.99 119.52\\nDividend Yield 5.79% 2.72% 6.40% —\\nMarket Cap 136.57 Bil 171.86 Bil 169.76 Bil 181.41 Bil\\n52-Week Range 14.46—22.84 28.39—50.98 32.79—55.51 103.77—154.38\\nInvestment Style Large Value Large Value Large Value Large Growth',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 10 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nMorningstar Valuation Model Summary\\nFinancials as of 25 Jan 2023 Actual Forecast\\nFiscal Year, ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nRevenue (USD Mil) 113,238 118,208 120,741 121,939 124,557 128,196 132,267 136,747\\nOperating Income (USD Mil) 23,058 22,116 22,911 25,381 26,565 27,935 29,358 31,098\\nEBITDA (USD Mil) 51,574 44,978 13,434 46,956 47,988 49,327 50,148 52,216\\nAdjusted EBITDA (USD Mil) 40,570 39,849 13,434 42,956 44,640 46,510 48,633 51,073\\nNet Income (USD Mil) 11,284 21,661 -8,727 18,641 18,917 19,558 19,651 20,697\\nAdjusted Net Income (USD Mil) 11,284 21,661 18,311 20,651 21,231 22,197 21,911 22,877\\nFree Cash Flow To The Firm (USD Mil) 52,151 4,182 -27 11,474 13,581 15,032 16,393 16,776\\nWeighted Average Diluted Shares Outstanding (Mil) 7,183 7,199 7,587 7,200 7,200 7,200 7,200 7,200\\nEarnings Per Share (Diluted) (USD) 1.57 3.01 -1.15 2.59 2.63 2.72 2.73 2.87\\nAdjusted Earnings Per Share (Diluted) (USD) 1.57 3.01 2.41 2.87 2.95 3.08 3.04 3.18\\nDividends Per Share (USD) 2.08 2.08 1.35 1.11 1.11 1.11 1.11 1.11\\nMargins & Returns as of 25 Jan 2023 Actual Forecast\\n3 Year Avg 2020 2021 2022 2023 2024 2025 2026 2027 5 Year Avg\\nOperating Margin % 19.4 20.4 18.7 19.0 20.8 21.3 21.8 22.2 22.7 21.8\\nEBITDA Margin % — 45.5 38.1 11.1 38.5 38.5 38.5 37.9 38.2 —\\nAdjusted EBITDA Margin % 26.9 35.8 33.7 11.1 35.2 35.8 36.3 36.8 37.4 36.3\\nNet Margin % 7.0 10.0 18.3 -7.2 15.3 15.2 15.3 14.9 15.1 15.2\\nAdjusted Net Margin % 14.5 10.0 18.3 15.2 16.9 17.1 17.3 16.6 16.7 16.9\\nFree Cash Flow To The Firm Margin % 16.5 46.1 3.5 0.0 9.4 10.9 11.7 12.4 12.3 11.3\\nGrowth & Ratios as of 25 Jan 2023 Actual Forecast\\n3 Year CAGR 2020 2021 2022 2023 2024 2025 2026 2027 5 Year CAGR\\nRevenue Growth % — — 4.4 2.1 1.0 2.2 2.9 3.2 3.4 2.5\\nOperating Income Growth % — — -4.1 3.6 10.8 4.7 5.2 5.1 5.9 6.3\\nEBITDA Growth % 0.0 — — — — — — — — 0.0\\nAdjusted EBITDA Growth % -21.9 43.8 -1.8 -66.3 219.8 3.9 4.2 4.6 5.0 30.6\\nEarnings Per Share Growth % — — — — — — — — — 5.7\\nAdjusted Earnings Per Share Growth % — — 91.5 -19.8 18.8 2.8 4.6 -1.3 4.4 5.7\\nValuation as of 25 Jan 2023 Actual Forecast\\n2020 2021 2022 2023 2024 2025 2026 2027\\nPrice/Earnings 13.8 6.2 7.6 7.1 6.9 6.6 6.7 6.4\\nPrice/Sales 2.5 1.7 1.5 1.2 1.2 1.1 1.1 1.1\\nPrice/Book 1.0 1.8 1.4 1.4 1.2 1.1 1.0 0.9\\nPrice/Cash Flow 10.3 8.1 10.9 9.3 8.2 7.4 6.9 6.8\\nEV/EBITDA 11.4 9.4 26.5 6.9 6.6 6.4 6.1 5.8\\nEV/EBIT 20.1 17.0 15.6 11.7 11.2 10.6 10.1 9.5\\nDividend Yield % 9.6 11.2 7.3 5.4 5.4 5.4 5.4 5.4\\nDividend Payout % 132.4 69.1 -117.4 42.9 42.3 40.9 40.7 38.6\\nFree Cash Flow Yield % 9.7 12.4 9.2 10.7 12.2 13.5 14.5 14.7\\nOperating Performance / Profitability as of 25 Jan 2023 Actual Forecast\\nFiscal Year, ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nROA % 2.1 4.5 -2.1 4.6 4.5 4.5 4.4 4.5\\nROE % 6.6 18.7 -10.7 19.1 17.4 16.3 15.0 14.4\\nROIC % 4.7 5.8 -1.6 8.1 8.1 8.2 8.3 8.6',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 11 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nFinancial Leverage Actual Forecast\\nFiscal Year, ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nDebt/Capital % 49.3 70.0 58.3 55.3 53.6 51.2 48.8 47.2\\nAssets/Equity 3.3 5.6 4.1 3.8 3.6 3.4 3.2 3.0\\nNet Debt/EBITDA 2.8 3.5 9.6 2.7 2.6 2.4 2.3 2.1\\nTotal Debt/EBITDA 3.9 4.4 10.1 3.1 3.1 2.9 2.8 2.7\\nEBITDA/ Net Interest Expense 5.1 7.6 2.2 7.2 7.4 7.8 8.1 8.5\\nKey Valuation Drivers as of 25 Jan 2023\\nCost of Equity % 9.0\\nPre-Tax Cost of Debt % 6.5\\nWeighted Average Cost of Capital % 7.4\\nLong-Run Tax Rate % 23.5\\nStage II EBI Growth Rate % 3.0\\nStage II Investment Rate % 12.0\\nPerpetuity Year 15\\nAdditional estimates and scenarios available for download at https://pitchbook.com/. Discounted Cash Flow Valuation as of 25 Jan 2023\\nUSD Mil\\nPresent Value Stage I 58,671\\nPresent Value Stage II 114,795\\nPresent Value Stage III 149,633\\nTotal Firm Value 323,100\\nCash and Equivalents 7,234\\nDebt -136,020\\nOther Adjustments -10,479\\nEquity Value 178,685\\nProjected Diluted Shares 7,200\\nFair Value per Share (USD) 25.00',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 12 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nIncome Statement (USD) Actual Forecast \\nFiscal Year, ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nRevenue (Mil)113,238 118,208 120,741 121,939 124,557 128,196 132,267 136,747\\nCost of Goods Sold (Mil) 72,667 78,233 79,808 78,982 79,917 81,685 83,633 85,673\\nGross Profit (Mil) 40,571 39,975 40,933 42,957 44,641 46,511 48,634 51,074\\nSelling, General, Administrative & Other Expenses (Mil) 1 1 1 1 1 1 1 1\\nAdvertising & Marketing Expenses — — — — — — — —\\nResearch & Development — — — — — — — —\\nDepreciation & Amortization (if reported separately) (Mil) 17,512 17,858 18,021 17,575 18,075 18,575 19,275 19,975\\nAdjusted Operating Income (Mil) 23,058 22,116 22,911 25,381 26,565 27,935 29,358 31,098\\nFinancial Non-Cash (Gains)/Losses (Mil) 0 0 27,498 0 0 0 0 0\\nIrregular Cash (Gains)/Losses (Mil) 0 0 0 -4,000 -3,349 -2,817 -1,515 -1,143\\nOperating Income (Mil) 23,058 22,116 -4,587 29,381 29,913 30,752 30,873 32,241\\nNet Interest Expense (Mil) 9,261 -6,451 -1,493 3,000 3,000 3,000 3,000 3,000\\nIncome Tax Expense (Mil) 965 5,220 3,780 6,068 6,325 6,522 6,550 6,872\\nAfter-Tax Items (Mil) -193 -207 -384 -203 -203 -203 -203 -203\\n(Minority Interest) (Mil) -1,355 -1,479 -1,469 -1,469 -1,469 -1,469 -1,469 -1,469\\nNet Income (Mil) 11,284 21,661 -8,727 18,641 18,917 19,558 19,651 20,697\\nAdjusted Net Income (Mil) 11,284 21,661 18,311 20,651 21,231 22,197 21,911 22,877\\nWeighted Average Diluted Shares Outstanding (Mil) 7,183 7,199 7,587 7,200 7,200 7,200 7,200 7,200\\nDiluted Earnings Per Share 1.57 3.01 -1.15 2.59 2.63 2.72 2.73 2.87\\nDiluted Adjusted Earnings Per Share 1.57 3.01 2.41 2.87 2.95 3.08 3.04 3.18\\nDividends Per Common Share (USD)2.08 2.08 1.35 1.11 1.11 1.11 1.11 1.11\\nEBITDA (Mil) 51,574 44,978 13,434 46,956 47,988 49,327 50,148 52,216\\nAdjusted EBITDA (Mil) 40,570 39,849 13,434 42,956 44,640 46,510 48,633 51,073',\n", " \"Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 13 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nKey Cash Flow Items (USD) Actual Forecast as of 25 Jan\\nFiscal Year, ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nCash from Working Capital (Mil) 3,258 -2,659 4,128 -1,767 -895 -1,089 483 485\\n(Capital Expenditures) (Mil) -15,675 -16,527 -19,626 -24,022 -23,043 -21,793 -21,824 -21,879\\nDepreciation (Mil) 20,277 17,112 17,945 17,500 18,000 18,500 19,200 19,900\\nAmortization (Mil) 8,239 5,750 76 75 75 75 75 75\\nNet New (Investment), Organic (Mil) -8,875 -13,947 -3,451 -7,789 -5,438 -4,382 -2,141 -1,494\\n(Purchases)/Sales of Companies & Assets (Mil) 1,790 -16,713 -10,001 -5,000 -5,000 -5,000 -5,000 -5,000\\nNet New (Investment), Total (Mil) -7,085 -30,660 -13,452 -12,789 -10,438 -9,382 -7,141 -6,494\\nOther Non-Cash Items, From Cash Flows (Mil) 37,816 13,303 -4,383 75 75 75 75 75\\nFree Cash Flow to the Firm (Mil) 52,151 4,182 -27 11,474 13,581 15,032 16,393 16,776\\nBalance Sheet (USD) Actual Forecast \\nFiscal Year, ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nAssets \\nCash and Equivalents (Mil) 9,740 19,223 3,701 2,678 9,202 13,453 18,030 26,858\\nInventory (Mil) 3,695 3,325 3,123 3,246 3,284 3,357 3,437 3,521\\nAccounts Receivable (Mil) 20,215 12,313 11,466 11,580 11,828 12,174 12,561 12,986\\nNet Property, Plant and Equipment (Mil) 152,029 121,649 149,259 155,781 160,824 164,117 166,741 168,721\\nGoodwill (Mil) 135,259 92,740 67,895 67,895 67,895 67,895 67,895 67,895\\nOther Intangibles (Mil) 146,316 119,221 129,446 134,371 139,296 144,221 149,146 154,071\\nOther Operating Assets (Mil) 56,727 57,207 34,430 34,430 34,430 34,430 34,430 34,430\\nNon-Operating Assets (Mil) 0 0 0 0 0 0 0 0\\nTotal Assets (Mil) 525,761 427,678 402,853 413,513 430,293 443,180 455,773 472,014\\nLiabilities \\nAccounts Payable (Mil) 49,032 39,095 42,644 41,114 40,506 39,835 40,786 41,780\\nDebt (Mil) 157,245 176,876 136,020 134,027 137,460 137,169 135,843 138,385\\nOther Operating Liabilities (Mil) 121,968 105,681 110,472 114,006 117,036 119,318 120,628 120,628\\nNon-Operating Liabilities (Mil) 18,276 12,560 7,260 7,260 7,260 7,260 7,260 7,260\\nTotal Liabilities (Mil) 346,521 334,212 296,396 296,407 302,261 303,582 304,517 308,053\\nEquity \\nShareholders' Equity (Mil) 161,673 75,943 97,500 108,149 119,074 130,640 142,299 155,004\\nMinority Interest (Mil) 17,567 17,523 8,957 8,957 8,957 8,957 8,957 8,957\\nTotal Equity (Mil) 179,240 93,466 106,457 117,106 128,031 139,597 151,256 163,961\",\n", " \"Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 14 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nManagement & Ownership\\nManagement Activity as of 31 Mar 2023\\nName Position Share Held Report Date* Insider Activity\\nJohn T. Stankey Director, President and Chief Executive Officer 233,176 31 Mar 2023 679,490\\nPascal Desroches Senior Executive Vice President and Chief Financial Officer 339,069 31 Mar 2023 342,470\\nLori M. Lee Chief Executive Officer, AT&T Latin America and Global Marketing Officer 93,540 31 Mar 2023 251,004\\nDavid S. Huntley Senior Executive Vice President and Chief Compliance Officer 139,936 31 Mar 2023 145,915\\nDavid R. McAtee Senior Executive Vice President and General Counsel 408,510 31 Mar 2023 579,775\\nJeffery S. McElfresh Chief Executive Officer of AT&T Communications LLC 198,931 31 Mar 2023 393,507\\nAngela R. Santone Senior Executive Vice President, Human Resources 104,603 31 Mar 2023 172,883\\nEdward W. GillespieSenior Executive Vice President, External and Legislative Affairs, AT&T \\nServices, Inc.48,065 31 Mar 2023 116,625\\nDebra L. Dial Senior Vice President, Chief Accounting Officer and Controller 105,951 31 Mar 2023 53,506\\nJason Kilar Chief Executive Officer of Warner Media, LLC 1,241,405 31 Mar 2022 1,025,225\\nFund Ownership as of 31 Dec 2022\\nTop Owners % of Shares Held % of Fund Assets Change (k) Portfolio Date\\nVanguard US Total Market Shares ETF 3.04 0.37 2,002,867 31 Dec 2022\\nVanguard Total Stock Market Index Fund 3.04 0.35 2,002,867 31 Dec 2022\\nVanguard Instl Ttl Stck Mkt Idx Tr 2.99 0.31 1,719,832 30 Sep 2022\\nVanguard 500 Index Fund 2.31 0.41 1,462,980 31 Dec 2022\\nSPDR® S&P 500 ETF Trust 1.10 0.41 -453,787 31 Dec 2022\\nConcentrated Holders\\nFidelity® Select Telecommunications Port 0.03 20.78 0 30 Nov 2022\\nFidelity® Telecom and Utilities Fund 0.07 10.28 0 30 Nov 2022\\nStratégie Télécom 0.00 8.70 143 31 Dec 2022\\nHIP Sustainable Global Dividends ESG 0.00 8.62 0 31 Dec 2022\\nRydex Telecommunications Fund 0.00 8.21 -294 30 Nov 2022\\nInstitutional Transactions as of 31 Dec 2022\\nTop 5 Buyers % of Shares Held % of Fund Assets Shrs Bought/Sold (k) Portfolio Date\\nMarshall Wace Asset Management Ltd 0.19 0.44 12,937,174 30 Sep 2022\\nRenaissance Technologies Corp 0.14 0.22 8,373,086 30 Sep 2022\\nRobeco Institutional Asset Management BV 0.19 0.68 4,823,559 30 Sep 2022\\nPrudential Financial Inc 0.18 0.33 4,748,238 30 Sep 2022\\nPrudential Investment Management Inc 0.18 0.33 4,748,238 30 Sep 2022\\nTop 5 Sellers\\nCapital World Investors 0.29 0.07 -39,206,166 30 Sep 2022\\nFranklin Resources Inc 0.06 0.03 -17,500,254 30 Sep 2022\\nJacobs Levy Equity Management, Inc. 0.00 — -7,521,561 30 Sep 2022\\nBlackRock Inc 6.95 0.26 -7,159,545 30 Sep 2022\\nJANE STREET GROUP, LLC 0.02 0.01 -5,431,003 30 Sep 2022\\n*Represents the date on which the owner's name, position, and common shares held were reported by the holder or issuer.\",\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 15 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nComparable Company Analysis These companies are chosen by the analyst and the data are shown by nearest calendar year in descending market capitalization order.\\nValuation Analysis as of 25 Jan 2023 Price/Earnings EV/EBITDA Price/Free Cash Flow Price/Book Price/Sales \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 15.6 12.0 11.0 9.1 7.0 6.8 14.2 9.8 9.9 2.4 1.9 1.8 2.0 1.4 1.5\\nVerizon Communications Inc VZ 7.6 9.1 9.4 8.1 7.3 7.2 15.5 10.0 9.4 — — 1.6 1.6 1.2 1.2\\nT-Mobile US Inc TMUS 48.1 59.7 19.9 9.2 10.8 9.4 90.9 51.5 17.8 2.1 2.7 2.4 1.8 2.3 2.2\\nAverage 23.8 26.9 13.4 8.8 8.4 7.8 40.2 23.8 12.4 2.2 2.3 1.9 1.8 1.6 1.6\\nAT&T Inc T 7.6 7.1 6.9 26.5 6.9 6.6 — 9.3 8.2 — — 1.2 1.5 1.2 1.2\\nReturns Analysis as of 25 Jan 2023 ROIC % Adjusted ROIC % Return on Equity % Return on Assets % Dividend Yield % \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 25.4 24.9 26.2 10.2 9.9 10.3 15.2 14.9 15.3 5.1 5.2 5.5 2.0 2.7 3.0\\nVerizon Communications Inc VZ — 9.1 8.9 6.4 — 8.1 24.6 19.6 17.7 5.7 4.8 4.6 6.5 6.5 6.7\\nT-Mobile US Inc TMUS 6.6 7.3 10.2 6.1 6.7 9.4 4.5 3.5 12.9 1.5 1.2 4.6 — — —\\nAverage 16.0 13.8 15.1 7.6 8.3 9.3 14.8 12.7 15.3 4.1 3.7 4.9 4.2 4.6 4.8\\nAT&T Inc T -1.6 8.1 8.1 -1.2 6.3 6.4 -10.7 19.1 17.4 -2.1 4.6 4.5 7.3 5.4 5.4\\nGrowth Analysis as of 25 Jan 2023 Revenue Growth % EBIT Growth % EPS Growth % FCF Growth % DPS Growth % \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 12.4 3.4 -1.5 19.0 11.4 5.9 23.9 3.8 8.2 24.1 26.6 -1.4 11.1 8.0 10.0\\nVerizon Communications Inc VZ 2.4 -0.5 1.2 -4.4 -2.8 -1.5 -5.9 -14.5 -2.9 -123.5 165.7 7.2 2.0 2.3 2.3\\nT-Mobile US Inc TMUS 17.1 0.5 4.7 -2.3 9.4 115.2 -9.2 2.9 200.7 19.5 -155.7 666.8 — — —\\nAverage 10.6 1.1 1.5 4.1 6.0 39.9 2.9 -2.6 68.7 -26.6 12.2 224.2 4.4 3.4 4.1\\nAT&T Inc T 2.1 1.0 2.2 3.6 10.8 4.7 -19.8 18.8 2.8 -100.6 -42154.1 18.4 -35.1 -17.8 0.0\\nProfitability Analysis as of 25 Jan 2023 Gross Margin % EBITDA Margin % Operating Margin % Net Margin % FCF Margin % \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 29.8 31.1 32.1 29.8 31.1 32.1 17.9 19.3 20.7 12.9 12.7 13.5 13.8 14.7 14.8\\nVerizon Communications Inc VZ 56.8 56.4 56.4 35.0 34.8 34.8 22.5 22.0 21.4 15.9 13.7 13.1 10.3 12.4 13.1\\nT-Mobile US Inc TMUS 54.3 53.1 57.1 33.2 33.2 36.3 8.6 9.4 19.3 — 4.0 11.5 2.0 4.4 12.3\\nAverage 47.0 46.9 48.5 32.7 33.0 34.4 16.3 16.9 20.5 9.6 10.1 12.7 8.7 10.5 13.4\\nAT&T Inc T 33.9 35.2 35.8 11.1 35.2 35.8 19.0 20.8 21.3 15.2 16.9 17.1 13.4 — 14.2\\nLeverage Analysis as of 25 Jan 2023 Debt/Equity % Debt/Total Cap % EBITDA/Net Int. Exp Total Debt/EBITDA Asset/Equity \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 104.1 99.8 93.1 51.0 49.9 48.2 8.1 8.3 8.5 2.9 2.6 2.5 2.9 2.8 2.7\\nVerizon Communications Inc VZ 165.3 157.8 144.8 62.3 — 59.1 13.2 9.5 9.1 3.1 3.3 3.2 4.2 4.0 3.8\\nT-Mobile US Inc TMUS 111.1 104.8 91.5 52.6 51.2 47.8 7.9 7.9 9.4 2.9 2.8 2.4 3.0 2.9 2.7\\nAverage 126.8 120.8 109.8 55.3 50.5 51.7 9.7 8.6 9.0 3.0 2.9 2.7 3.4 3.2 3.1\\nAT&T Inc T 139.5 123.9 115.4 58.3 — 53.6 2.2 7.2 7.4 10.1 3.1 3.1 4.1 3.8 3.6\\nLiquidity Analysis as of 25 Jan 2023 Cash per Share Current Ratio Quick Ratio Cash/Short-Term Debt Payout Ratio % \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 1.9 2.3 2.2 0.8 0.9 0.8 0.8 0.9 0.8 4.1 2.4 2.5 32.9 34.0 34.5\\nVerizon Communications Inc VZ — 2.6 2.9 0.8 — 1.1 0.7 1.0 1.0 0.3 — 1.9 50.9 59.5 62.7\\nT-Mobile US Inc TMUS 5.3 3.0 7.6 0.9 1.0 1.4 0.8 0.8 1.2 1.0 1.9 5.0 0.0 0.0 0.0\\nAverage 1.8 2.1 3.5 0.8 0.7 1.0 0.7 0.8 0.9 1.5 1.1 2.7 -8.4 34.1 34.9\\nAT&T Inc T — 0.4 1.3 0.7 0.7 0.8 0.6 0.6 0.7 0.5 — 1.2 -117.4 42.9 42.3',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 16 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nCompetitors Price vs. Fair Value\\nComcast Corp Class A CMCSA\\n050100150200Fair Value: 60.00\\n29 Jul 2021 17:13, UTC\\nLast Close: 40.10\\nOver Valued\\nUnder Valued\\n2018 2019 2020 2021 2022 YTD\\n0.81 1.00 1.05 0.84 0.58 0.67 Price/Fair Value\\n-12.69 33.92 18.52 -2.08 -28.41 15.44 Total Return %\\nMorningstar Rating\\nTotal Return % as of 25 Jan 2023. Last Close as of 25 Jan 2023. Fair Value as of 29 Jul 2021 17:13, UTC.\\nVerizon Communications Inc VZ\\n050100150200Fair Value: 57.00\\n24 Jan 2023 21:06, UTC\\nLast Close: 40.33\\nOver Valued\\nUnder Valued\\n2018 2019 2020 2021 2022 YTD\\n0.97 1.06 1.03 0.90 0.67 0.71 Price/Fair Value\\n10.70 13.52 -0.29 -7.26 -19.22 4.02 Total Return %\\nMorningstar Rating\\nTotal Return % as of 25 Jan 2023. Last Close as of 25 Jan 2023. Fair Value as of 24 Jan 2023 21:06, UTC.',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 17 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nCompetitors Price vs. Fair Value (Continued)\\nT-Mobile US Inc TMUS\\n050100150200Fair Value: 165.00\\n28 Oct 2022 19:59, UTC\\nLast Close: 148.07\\nOver Valued\\nUnder Valued\\n2018 2019 2020 2021 2022 YTD\\n0.84 0.97 1.25 0.86 0.85 0.90 Price/Fair Value\\n0.16 23.28 71.96 -13.99 20.71 5.76 Total Return %\\nMorningstar Rating\\nTotal Return % as of 25 Jan 2023. Last Close as of 25 Jan 2023. Fair Value as of 28 Oct 2022 19:59, UTC.',\n", " \"Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 18 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nRecent Analyst Notes\\nThe U.S. Wireless Carriers Are Poised to Gush Cash; Verizon Shares Particularly Attractive Michael \\nHodel,Director,16 Nov 2022\\nSentiment around the U.S. wireless industry, especially Verizon, has turned negative recently. We suspect \\nindustry bears hold two key contentions: First, the carriers will perpetually spend egregiously on their networks, \\nprimarily buying wireless spectrum whenever the government makes more available. Second, in an extremely \\nmature market, these firms will beat each other up seeking whatever growth remains, punishing revenue and \\nmargins. As such, balance sheets will continually need repair and cash available for shareholders will be \\nincreasingly limited.We believe this outlook is wrong. Following a series of spectrum auctions, AT&T and Verizon \\nhave acquired a trove of spectrum that should allow both firms to close the network speed and capacity gap that \\nT-Mobile has opened recently. Even with the huge increase in capital invested following these auctions, returns \\non capital remain acceptable for each of the wireless carriers, in our view. Going forward, we expect driving \\nreturns comfortably above the cost of capital will be the carriers' highest priority.Market share shifts gradually \\nthanks to phone installment plans and general customer inertia. As a result, we believe the carriers will have \\nincreasingly little to gain from huge new network initiatives or increased promotional intensity designed to grab \\nmarket share. Maximizing the long-term value of the industry as whole, without running afoul of regulators, is the \\nrational choice for each carrier in our view.In our view, this outlook means that market share will gradually move \\ntoward parity. As the current share leader and historically the industry's premium player, we believe Verizon has \\nlittle choice but to accept gradual market share losses. The stock market clearly hates the customer losses the \\nfirm has reported recently. However, we account for share losses in our fair value estimate. While AT&T and T-\\nMobile also trade below our fair value estimates, we believe Verizon shares are particularly attractive. \\nAT&T Posts Another Solid Quarter as Revenue Growth Continues to Accelerate Michael Hodel,Director,20 Oct \\n2022\\nAT&T’s third-quarter results lend support to our view that the firm is poised to deliver steadily improving \\nperformance in the coming years. While wireless customer additions slowed, revenue per customer spiked \\nhigher, exceeding our expectations. The firm expects to meet or exceed financial targets for the year, including \\ngenerating $14 billion of free cash flow. While AT&T has clearly backed away from the 2023 free cash flow target \\nof $20 billion set following the Warner spinoff, management expects this metric to grow next year, which we \\nbelieve to be very reasonable and provides comfort around the dividend. We are maintaining our $25 fair value \\nestimate, and we think the stock is significantly undervalued.Adjusted for business dispositions, total revenue \\nincreased 3.1% year over year on solid results across all segments. Wireless service revenue (about half of total \\nfirm sales) increased 5.6%, the best result in a decade. AT&T added 708,000 postpaid phone customers during \\nthe quarter, down from 928,000 a year ago. The firm continues to do a great job of attracting new customers but \\nthe pace of those leaving picked up slightly: monthly postpaid phone churn was 0.84%, up from 0.72% last year. \",\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 19 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nAT&T has pushed some customers away with select price increases, but churn remains below prepandemic \\nlevels. Also, average revenue per postpaid phone customer jumped 2.4% versus a year ago, far stronger than \\nexpected entering the year given the accelerating amortization of past promotional credits against \\nrevenue.Wireless profitability remains solid. The segment generated a 41.7% EBITDA margin, down slightly from \\n41.9% a year ago. Management expects margins to begin improving as 3G network shutdown costs dissipate, \\ninvestments to improve efficiency deliver results, and the benefits of increased sales drive operating \\nleverage.Consolidated free cash flow was flat versus a year ago at $3.8 billion despite a step up in capital \\ninvestment to $6.8 billion from $5.5 billion. \\nAT&T Drives Continued Wireless Momentum During Q2; 2022 Free Cash Flow Target Drops to $14 Billion Neil \\nMacker,Senior Equity Analyst,22 Jul 2022\\nAT&T posted solid telecom results for the second quarter, keeping the firm on pace to meet or exceed \\nmanagement’s 2022 subscriber growth expectations. The continued growth in wireless additions led to an \\nincrease in the mobility services revenue growth target to 4%-5% from “at least 3%.” However, management cut \\nits free cash flow target for 2022 by $2 billion to $14 billion due to continued growth investments and the timing \\nof collections. Our fair value estimate, which reflects the Warner spinoff, remains $25 per share. We continue to \\nlike AT&T’s strategic position and its network investment plans, which we expect will deliver improving revenue \\nand profit growth over the next several years.Adjusted for the Warner spinoff, DirecTV transaction, and Latin \\nAmerican asset sale, total revenue (now roughly two thirds wireless, with most of the remainder enterprise and \\nconsumer fixed-line services) increased 2.2% year over year to $29.6 billion. Wireless service revenue growth \\naccelerated to 4.8% year over year, ahead of management’s previous 2022 target and in line with the new one, \\non strong postpaid phone customer growth in recent quarters. AT&T added 813,000 postpaid phone customers \\nduring the quarter, up from 798,000 a year ago, the strongest second quarter in a decade. Despite more than two \\nyears of blistering industrywide growth, we still believe that postpaid customer additions will eventually have to \\ntick down and match population growth more closely, but AT&T has yet to see any sign of falling \\ndemand.Average revenue per postpaid phone customer was also strong, growing 1.1% versus a year ago as \\npromotional credits, which are amortized against revenue, declined in the quarter and more customers traded up \\nto higher-priced unlimited plans. Management expects average revenue per postpaid phone customer to improve \\nfurther in the second half. Segment EBITDA expanded by 2.5% year over year, with further expansion projected in \\nthe second half of 2022. \\nAT&T Avoids Distraction, Continues to Gain Wireless Momentum During Q1 Michael Hodel,Director,21 Apr \\n2022\\nAT&T delivered generally solid telecom results for its first quarter, putting it on pace to at least meet \\nmanagement’s 2022 growth expectations. Evaluating profitability and cash flow is more difficult, given heavy \\ninvestment in the outgoing WarnerMedia business, the complexity of the various transactions AT&T has ',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 20 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nundertaken recently, 3G wireless network shutdown costs, and typical seasonal pressures. Management remains \\ncommitted to delivering $16 billion of free cash flow this year and $20 billion in 2023 under the more conservative \\ncalculation it has adopted. Our fair value estimate, recently adjusted to reflect the Warner spinoff, remains $25 \\nper share. We continue to like AT&T’s strategic position and its network investment plans, which we expect will \\ndeliver improving revenue and profit growth over the next several years.Adjusted for the Warner spinoff, DirecTV \\ntransaction, and Latin American asset sale, total revenue (now roughly two thirds wireless, with most of the \\nremainder enterprise and consumer fixed-line services) increased 2.5% year over year. Wireless service revenue \\ngrowth accelerated to 4.8% year over year, well ahead of management’s “at least 3%” 2022 target, on strong \\npostpaid phone customer growth in recent quarters. That strength continued as AT&T added 691,000 postpaid \\nphone customers during the quarter, up from 595,000 a year ago, extending the impressive turnaround in the \\nbusiness. After two years of torrid industrywide growth, postpaid customer additions will eventually have to \\nmatch population growth more closely, but AT&T hasn’t yet seen any sign of falling demand.Average revenue per \\npostpaid phone customer was also surprisingly strong (though perhaps buoyed by the 3G shutdown), declining \\nonly 0.2% versus a year ago despite heavy promotional credits, which are amortized against revenue. Segment \\nEBITDA declined 1.8% year over year but would have increased about 2% absent 3G network shutdown costs. \\nWarner Bros. Discovery Launches as a Media Powerhouse; AT&T Now Focused on Telecom Neil \\nMacker,Senior Equity Analyst,11 Apr 2022\\nThe long-awaited merger between Discovery and WarnerMedia is complete. We are maintaining our narrow \\nmoat rating for the successor firm and lowering our fair value estimate to $40 from $42 as we have updated our \\nmodel to fully incorporate the pro forma results and to forecast the combined firm. For AT&T, we also maintain \\nour narrow moat rating on the standalone telecom firm, with a $25 fair value estimate.Warner Bros. Discovery is \\nnow one of the largest media firms in the world with tremendous scale and reach. The merger has created a firm \\nwith tremendous content production and distribution capabilities along with a very deep and wide content \\nlibrary. The new company owns a number of well-known networks including HBO, Discovery, CNN, and TLC as \\nwell as a slew of major entertainment franchises like Superman, Rick and Morty, and Game of Thrones. We \\nproject that the new company, led by Discovery CEO David Zaslav, will use its combined programming library and \\nproduction capabilities to drive further growth in its streaming services as it navigates the transition toward a \\nmore direct-to-consumer focused model, centered on combined HBO Max/Discovery+ services.As for AT&T, we \\nbelieve the firm is in a much stronger place, with renewed management focus and a stronger financial position. \\nWe remain optimistic about the wireless business and expect that AT&T and its rivals will compete rationally, \\nallowing for steady, albeit slow, growth and solid cash flow. We also like the firm’s investment plans, which call \\nfor aggressive investment in wireless network capacity and the fiber network over the next several years. We \\nexpect AT&T will emerge from this period of investment in a unique place within the telecom industry, with the \\nability to use its combined wireless and fixed-line capabilities to grab market share across a large and growing \\nportion of the U.S. ',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 21 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nAT&T Follows Verizon, Pledging Modest Growth and Lower Network Investment in 2024 and Beyond Michael \\nHodel,Director,13 Mar 2022\\nAT&T provided additional financial details at its 2022 analyst day, but the firm’s strategic path was largely \\nunchanged. AT&T has two major priorities focused on a common objective: deploying the mid-band spectrum \\nacquired recently and expanding its fiber network aggressively to provide high-quality telecom services. \\nManagement reiterated its $20 billion 2023 free cash flow target, clarifying that this figure includes payments for \\nvendor financing. We are leaving our fair value estimate at $35 and believe the stock is attractive.AT&T continues \\nto target 30 million customer locations passed with fiber by the end of 2025, roughly doubling its current footprint \\nto reach half of its fixed-line territory. The firm also spoke at length for the first time about retiring its copper \\nnetworks—it believes current demand is so low across 25% of its fixed-line territory (about 15 million locations) \\nthat regulators will allow it to shift exclusively to wireless technologies in those locations by the end of 2025. If \\nsuccessful, this shift would substantially improve the firm’s cost structure.AT&T also expects to cover 200 million \\npeople with deep mid-band spectrum holdings by the end of 2023, likely putting it behind Verizon (targeting 175 \\nmillion by the end of this year) and T-Mobile (210 million at the end of 2021). We don’t believe this gap is a \\nconcern as AT&T is likely targeting areas with the strongest need, and it should reach coverage parity quickly \\nbeyond 2023. We expect AT&T will have a strong network position over the medium term as it combines fiber and \\nwireless coverage.The $24 billion network budget for 2022 was maintained, but, as with Verizon last week, AT&T \\nmade clear that spending will ramp down once spending to deploy mid-band spectrum slows in 2024. We believe \\nAT&T’s financial targets, including its investment plans, make the same assumption as Verizon’s--that the \\nwireless competitive environment remains the same or improves in the coming years. ',\n", " \"Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 22 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®Research Methodology for Valuing Companies\\nMorningstar Equity Research Star Rating Methodology\\nOverview\\nAt the heart of our valuation system is a detailed projec-\\ntion of a company’s future cash flows, resulting from our \\nanalysts’ research. Analysts create custom industry and \\ncompany assumptions to feed income statement, balance \\nsheet, and capital investment assumptions into our glob-\\nally standardized, proprietary discounted cash flow, or \\nDCF, modeling templates. We use scenario analysis, inde-\\npth competitive advantage analysis, and a variety of other \\nanalytical tools to augment this process. Moreover, we \\nthink analyzing valuation through discounted cash flows \\npresents a better lens for viewing cyclical companies, \\nhigh-growth firms, businesses with finite lives (e.g., \\nmines), or companies expected to generate negative \\nearnings over the next few years. That said, we don’t dis-\\nmiss multiples altogether but rather use them as support-\\ning cross-checks for our DCF-based fair value estimates. \\nWe also acknowledge that DCF models offer their own \\nchallenges (including a potential proliferation of estim-\\nated inputs and the possibility that the method may miss \\nshortterm market-price movements), but we believe these \\nnegatives are mitigated by deep analysis and our \\nlongterm approach.\\nMorningstar’s equity research group (”we,” “our”) be-\\nlieves that a company’s intrinsic worth results from the \\nfuture cash flows it can generate. The Morningstar Rating \\nfor stocks identifies stocks trading at a discount or premi-\\num to their intrinsic worth—or fair value estimate, in \\nMorningstar terminology. Five-star stocks sell for the \\nbiggest risk adjusted discount to their fair values, where-\\nas 1-star stocks trade at premiums to their intrinsic worth.\\nFour key components drive the Morningstar rating: (1) our \\nassessment of the firm’s economic moat, (2) our estimate \\nof the stock’s fair value, (3) our uncertainty around that \\nfair value estimate and (4) the current market price. This \\nprocess ultimately culminates in our singlepoint star rat-\\ning.\\n1. Economic Moat\\nThe concept of an economic moat plays a vital role not \\nonly in our qualitative assessment of a firm’s long-term \\ninvestment potential, but also in the actual calculation of \\nour fair value estimates. An economic moat is a structural \\nfeature that allows a firm to sustain excess profits over a long period of time. We define economic profits as re-\\nturns on invested capital (or ROIC) over and above our es-\\ntimate of a firm’s cost of capital, or weighted average \\ncost of capital (or WACC). Without a moat, profits are \\nmore susceptible to competition. We have identified five \\nsources of economic moats: intangible assets, switching \\ncosts, network effect, cost advantage, and efficient scale.\\nCompanies with a narrow moat are those we believe are \\nmore likely than not to achieve normalized excess returns \\nfor at least the next 10 years. Wide-moat companies are \\nthose in which we have very high confidence that excess \\nreturns will remain for 10 years, with excess returns more \\nlikely than not to remain for at least 20 years. The longer \\na firm generates economic profits, the higher its intrinsic \\nvalue. We believe low-quality, no-moat companies will \\nsee their normalized returns gravitate toward the firm’s \\ncost of capital more quickly than companies with moats.\\nWhen considering a company's moat, we also assess \\nwhether there is a substantial threat of value destruction, \\nstemming from risks related to ESG, industry disruption, \\nfinancial health, or other idiosyncratic issues. In this con-\\ntext, a risk is considered potentially value destructive if its \\noccurrence would eliminate a firm’s economic profit on a \\ncumulative or midcycle basis. If we deem the probability \\nof occurrence sufficiently high, we would not characterize \\nthe company as possessing an economic moat.\\nTo assess the sustainability of excess profits, analysts \\nperform ongoing assessments of the moat trend. A firm’s \\nmoat trend is positive in cases where we think its sources \\nof competitive advantage are growing stronger; stable \\nwhere we don’t anticipate changes to competitive ad-\\nvantages over the next several years; or negative when \\nwe see signs of deterioration.\\n2. Estimated Fair Value\\nCombining our analysts’ financial forecasts with the \\nfirm’s economic moat helps us assess how long returns \\non invested capital are likely to exceed the firm’s cost of \\ncapital. Returns of firms with a wide economic moat rat-\\ning are assumed to fade to the perpetuity period over a \\nlonger period of time than the returns of narrow-moat \\nfirms, and both will fade slower than no-moat firms, in-\\ncreasing our estimate of their intrinsic value.Our model is divided into three distinct stages:\\nStage I: Explicit Forecast\\nIn this stage, which can last five to 10 years, analysts \\nmake full financial statement forecasts, including items \\nsuch as revenue, profit margins, tax rates, changes in \\nworkingcapital accounts, and capital spending. Based on \\nthese projections, we calculate earnings before interest, \\nafter taxes (EBI) and the net new investment (NNI) to de-\\nrive our annual free cash flow forecast.\\nStage II: Fade\\nThe second stage of our model is the period it will take \\nthe company’s return on new invested capital—the re-\\nturn on capital of the next dollar invested (“RONIC”)—to \\ndecline (or rise) to its cost of capital. During the Stage II \\nperiod, we use a formula to approximate cash flows in \\nlieu of explicitly modeling the income statement, balance \\nsheet, and cash flow statement as we do in Stage I. The \\nlength of the second stage depends on the strength of \\nthe company’s economic moat. We forecast this period to \\nlast anywhere from one year (for companies with no eco-\\nnomic moat) to 10–15 years or more (for wide-moat com-\\npanies). During this period, cash flows are forecast using \\nfour assumptions: an average growth rate for EBI over the \\nperiod, a normalized investment rate, average return on \\nnew invested capital (RONIC), and the number of years \\nuntil perpetuity, when excess returns cease. The invest-\\nment rate and return on new invested capital decline un-\\ntil a perpetuity value is calculated. In the case of firms \\nthat do not earn their cost of capital, we assume marginal \\nROICs rise to the firm’s cost of capital (usually attribut-\\nable to less reinvestment), and we may truncate the \\nsecond stage.\\nStage III: Perpetuity\\nOnce a company’s marginal ROIC hits its cost of capital, \\nwe calculate a continuing value, using a standard per-\\npetuity formula. At perpetuity, we assume that any \\ngrowth or decline or investment in the business neither \\ncreates nor destroys value and that any new investment \\nprovides a return in line with estimated WACC.\\nBecause a dollar earned today is worth more than a dollar \\nearned tomorrow, we discount our projections of cash \\nflows in stages I, II, and III to arrive at a total present \\nvalue of expected future cash flows. Because we are \\nmodeling free cash flow to the firm—representing cash \\navailable to provide a return to all capital providers—we \\ndiscount future cash flows using the WACC, which is a \\nweighted average of the costs of equity, debt, and pre-\\nferred stock (and any other funding sources), using ex-\\npected future proportionate long-term, market-value \\nweights.\\n3. Uncertainty Around That Fair Value Estimate\",\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 23 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®Research Methodology for Valuing Companies\\nMorningstar Equity Research Star Rating Methodology\\n Morningstar’s Uncertainty Rating is designed to capture \\nthe range of potential outcomes for a company’s intrinsic \\nvalue. This rating is used to assign the margin of safety \\nrequired before investing, which in turn explicitly drives \\nour stock star rating system. The Uncertainty Rating is \\naimed at identifying the confidence we should have in as-\\nsigning a fair value estimate for a given stock. \\nOur Uncertainty Rating is meant to take into account any-\\nthing that can increase the potential dispersion of future \\noutcomes for the intrinsic value of a company, and any-\\nthing that can affect our ability to accurately predict \\nthese outcomes. The rating begins with a suggested rat-\\ning produced by a quantitative process based on the trail-\\ning 12-month standard deviation of daily stock returns. \\nAn analyst overlay is then applied, with analysts using \\nthe suggested rating, historical rating data, and their own \\nknowledge of the company to inform them as they make \\nthe final Uncertainty Rating decision. Ultimately, the rat-\\ning decision rests with the analyst. Analysts take into ac-\\ncount many characteristics when making their final de-\\ncision, including cyclical factors, operational and financial \\nfactors such as leverage, company-specific events, ESG \\nrisks, and anything else that might increase the potential \\ndispersion of future outcomes and our ability to estimate \\nthose outcomes. \\nOur recommended margin of safety—the discount to fair \\nvalue demanded before we’d recommend buying or \\nselling the stock—widens as our uncertainty of the es-\\ntimated value of the equity increases. The more uncertain \\nwe are about the potential dispersion of outcomes, the \\ngreater the discount we require relative to our estimate of \\nthe value of the firm before we would recommend the \\npurchase of the shares. In addition, the Uncertainty Rat-\\ning provides guidance in portfolio construction based on \\nrisk tolerance. \\nOur Uncertainty Ratings are: Low, Medium, High, Very \\nHigh, and Extreme.\\nMargin of Safety\\nQualitative Analysis \\nUncertainty Ratings QQQQQ Rating QRating\\nLow 20% Discount 25% Premium\\nMedium 30% Discount 35% Premium\\nHigh 40% Discount 55% Premium\\nVery High 50% Discount 75% Premium\\nExtreme 75% Discount 300% Premium\\nOur uncertainty rating is based on the interquartile range, \\nor the middle 50% of potential outcomes, covering the \\n25th percentile–75th percentile. This means that when a \\nstock hits 5 stars, we expect there is a 75% chance that \\nthe intrinsic value of that stock lies above the current \\nmarket price. Similarly, when a stock hits 1 star, we ex-pect there is a 75% chance that the intrinsic value of that \\nstock lies below the current market price.\\n4. Market Price\\nThe market prices used in this analysis and noted in the \\nreport come from exchange on which the stock is listed \\nwhich we believe is a reliable source.\\nFor more details about our methodology, please go to \\nhttps://shareholders.morningstar.com\\nMorningstar Star Rating for Stocks\\nOnce we determine the fair value estimate of a stock, we \\ncompare it with the stock’s current market price on a \\ndaily basis, and the star rating is automatically re-calcu-\\nlated at the market close on every day the market on \\nwhich the stock is listed is open. Our analysts keep close \\ntabs on the companies they follow, and, based on thor-\\nough and ongoing analysis, raise or lower their fair value \\nestimates as warranted.\\nPlease note, there is no predefined distribution of stars. \\nThat is, the percentage of stocks that earn 5 stars can \\nfluctuate daily, so the star ratings, in the aggregate, can \\nserve as a gauge of the broader market’s valuation. \\nWhen there are many 5-star stocks, the stock market as a \\nwhole is more undervalued, in our opinion, than when \\nvery few companies garner our highest rating.\\nWe expect that if our base-case assumptions are true the \\nmarket price will converge on our fair value estimate over time generally within three years (although it is im-\\npossible to predict the exact time frame in which market \\nprices may adjust).\\nOur star ratings are guideposts to a broad audience and \\nindividuals must consider their own specific investment \\ngoals, risk tolerance, tax situation, time horizon, income \\nneeds, and complete investment portfolio, among other \\nfactors.\\nThe Morningstar Star Ratings for stocks are defined be-\\nlow:\\nQQQQQ We believe appreciation beyond a fair risk ad-\\njusted return is highly likely over a multiyear time frame. \\nScenario analysis developed by our analysts indicates \\nthat the current market price represents an excessively \\npessimistic outlook, limiting downside risk and maximiz-\\ning upside potential.\\nQQQQ We believe appreciation beyond a fair risk-ad-\\njusted return is likely.\\nQQQ Indicates our belief that investors are likely to re-\\nceive a fair risk-adjusted return (approximately cost of \\nequity).\\nQQ We believe investors are likely to receive a less than \\nfair risk-adjusted return.\\nQ Indicates a high probability of undesirable risk-adjus-\\nted returns from the current market price over a multiyear ',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 24 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®Research Methodology for Valuing Companies\\ntime frame, based on our analysis. Scenario analysis by \\nour analysts indicates that the market is pricing in an ex-\\ncessively optimistic outlook, limiting upside potential and \\nleaving the investor exposed to Capital loss.\\nOther Definitions\\nLast Price: Price of the stock as of the close of the mar-\\nket of the last trading day before date of the report.\\nCapital Allocation Rating: Our Capital Allocation (or \\nStewardship) Rating represents our assessment of the \\nquality of management’s capital allocation, with particu-\\nlar emphasis on the firm’s balance sheet, investments, \\nand shareholder distributions. Analysts consider compan-\\nies’ investment strategy and valuation, balance sheet \\nmanagement, and dividend and share buyback policies. \\nCorporate governance factors are only considered if they \\nare likely to materially impact shareholder value, though \\neither the balance sheet, investment, or shareholder dis-\\ntributions. Analysts assign one of three ratings: \"Exem-\\nplary\", \"Standard\", or \"Poor\". Analysts judge Capital Alloc-\\nation from an equity holder’s perspective. Ratings are de-\\ntermined on a forward looking and absolute basis. The \\nStandard rating is most common as most managers will \\nexhibit neither exceptionally strong nor poor capital alloc-\\nation.\\nCapital Allocation (or Stewardship) analysis published pri-\\nor to Dec. 9, 2020, was determined using a different pro-\\ncess. Beyond investment strategy, financial leverage, and \\ndividend and share buyback policies, analysts also con-\\nsidered execution, compensation, related party transac-\\ntions, and accounting practices in the rating.\\nCapital Allocation Rating: Our Capital Allocation (or \\nStewardship) Rating represents our assessment of the \\nquality of management’s capital allocation, with particu-\\nlar emphasis on the firm’s balance sheet, investments, \\nand shareholder distributions. Analysts consider compan-\\nies’ investment strategy and valuation, balance sheet \\nmanagement, and dividend and share buyback policies. \\nCorporate governance factors are only considered if they \\nare likely to materially impact shareholder value, though \\neither the balance sheet, investment, or shareholder dis-\\ntributions. Analysts assign one of three ratings: \"Exem-\\nplary\", \"Standard\", or \"Poor\". Analysts judge Capital Alloc-\\nation from an equity holder’s perspective. Ratings are de-\\ntermined on a forward looking and absolute basis. The \\nStandard rating is most common as most managers will \\nexhibit neither exceptionally strong nor poor capital alloc-\\nation.\\nCapital Allocation (or Stewardship) analysis published pri-\\nor to Dec. 9, 2020, was determined using a different pro-\\ncess. Beyond investment strategy, financial leverage, and \\ndividend and share buyback policies, analysts also con-sidered execution, compensation, related party transac-\\ntions, and accounting practices in the rating.\\nSustainalytics ESG Risk Rating Assessment: The ESG \\nRisk Rating Assessment is provided by Sustainalytics; a \\nMorningstar company.\\nSustainalytics’ ESG Risk Ratings measure the degree to \\nwhich company’s economic value at risk is driven by en-\\nvironment, social and governance (ESG) factors.\\nSustainalytics analyzes over 1,300 data points to assess a \\ncompany’s exposure to and management of ESG risks. In \\nother words, ESG Risk Ratings measures a company’s un-\\nmanaged ESG Risks represented as a quantitative score. \\nUnmanaged Risk is measured on an open-ended scale \\nstarting at zero (no risk) with lower scores representing \\nless unmanaged risk and, for 95% of cases, the unman-\\naged ESG Risk score is below 50.\\nBased on their quantitative scores, companies are \\ngrouped into one of five Risk Categories (negligible, low, \\nmedium, high, severe). These risk categories are absolute, \\nmeaning that a ‘high risk’ assessment reflects a compar-\\nable degree of unmanaged ESG risk across all subindus-\\ntries covered.\\nThe ESG Risk Rating Assessment is a visual representa-\\ntion of Sustainalytics ESG Risk Categories on a 1 to 5 \\nscale. Companies with Negligible Risk = 5 Globes, Low \\nRisk = 4, Medium Risk = 3 Globes, High Risk = 2 Globes, \\nSevere Risk = 1 Globe. For more information, please visit \\nsustainalytics.com/esg-ratings/\\nRatings should not be used as the sole basis in evaluating \\na company or security. Ratings involve unknown risks and \\nuncertainties which may cause our expectations not to \\noccur or to differ significantly from what was expected \\nand should not be considered an offer or solicitation to \\nbuy or sell a security.\\nRisk Warning\\nPlease note that investments in securities are subject to \\nmarket and other risks and there is no assurance or guar-\\nantee that the intended investment objectives will be \\nachieved. Past performance of a security may or may not \\nbe sustained in future and is no indication of future per-\\nformance. A security investment return and an investor’s \\nprincipal value will fluctuate so that, when redeemed, an \\ninvestor’s shares may be worth more or less than their \\noriginal cost. A security’s current investment performance \\nmay be lower or higher than the investment performance \\nnoted within the report. Morningstar’s Uncertainty Rating \\nserves as a useful data point with respect to sensitivity \\nanalysis of the assumptions used in our determining a fair \\nvalue price.General Disclosure\\nUnless otherwise provided in a separate agreement, re-\\ncipients accessing this report may only use it in the coun-\\ntry in which the Morningstar distributor is based. Unless \\nstated otherwise, the original distributor of the report is \\nMorningstar Research Services LLC, a U.S.A. domiciled \\nfinancial institution.\\nThis report is for informational purposes only and has no \\nregard to the specific investment objectives, financial \\nsituation or particular needs of any specific recipient. This \\npublication is intended to provide information to assist in-\\nstitutional investors in making their own investment de-\\ncisions, not to provide investment advice to any specific \\ninvestor. Therefore, investments discussed and recom-\\nmendations made herein may not be suitable for all in-\\nvestors: recipients must exercise their own independent \\njudgment as to the suitability of such investments and re-\\ncommendations in the light of their own investment ob-\\njectives, experience, taxation status and financial posi-\\ntion.\\nThe information, data, analyses and opinions presented \\nherein are not warranted to be accurate, correct, com-\\nplete or timely. Unless otherwise provided in a separate \\nagreement, neither Morningstar, Inc. or the Equity Re-\\nsearch Group represents that the report contents meet all \\nof the presentation and/or disclosure standards applic-\\nable in the jurisdiction the recipient is located.\\nExcept as otherwise required by law or provided for in a \\nseparate agreement, the analyst, Morningstar, Inc. and \\nthe Equity Research Group and their officers, directors \\nand employees shall not be responsible or liable for any \\ntrading decisions, damages or other losses resulting from, \\nor related to, the information, data, analyses or opinions \\nwithin the report. The Equity Research Group encourages \\nrecipients recipients of this report to read all relevant is-\\nsue documents (e.g., prospectus) pertaining to the secur-\\nity concerned, including without limitation, information \\nrelevant to its investment objectives, risks, and costs be-\\nfore making an in vestment decision and when deemed \\nnecessary, to seek the advice of a legal, tax, and/or ac-\\ncounting professional.\\nThe Report and its contents are not directed to, or inten-\\nded for distribution to or use by, any person or entity who \\nis a citizen or resident of or located in any locality, state, \\ncountry or other jurisdiction where such distribution, pub-\\nlication, availability or use would be contrary to law or \\nregulation or which would subject Morningstar, Inc. or its \\naffiliates to any registration or licensing requirements in \\nsuch jurisdiction.',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 25 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®Research Methodology for Valuing Companies\\nWhere this report is made available in a language other \\nthan English and in the case of inconsistencies between \\nthe English and translated versions of the report, the Eng-\\nlish version will control and supersede any ambiguities \\nassociated with any part or section of a report that has \\nbeen issued in a foreign language. Neither the analyst, \\nMorningstar, Inc., or the Equity Research Group guaran-\\ntees the accuracy of the translations.\\nThis report may be distributed in certain localities, coun-\\ntries and/or jurisdictions (“Territories”) by independent \\nthird parties or independent intermediaries and/or distrib-\\nutors (“Distributors”). Such Distributors are not acting as \\nagents or representatives of the analyst, Morningstar, \\nInc. or the Equity Research Group. In Territories where a \\nDistributor distributes our report, the Distributor is solely \\nresponsible for complying with all applicable regulations, \\nlaws, rules, circulars, codes and guidelines established by \\nlocal and/or regional regulatory bodies, including laws in \\nconnection with the distribution third-party research re-\\nports.\\nConflicts of Interest\\nuNo interests are held by the analyst with respect to the \\nsecurity subject of this investment research report.\\nuMorningstar, Inc. may hold a long position in the se-\\ncurity subject of this investment research report that \\nexceeds 0.5% of the total issued share capital of the \\nsecurity. To determine if such is the case, please click \\nhttp://msi.morningstar.com and http://mdi.morning-\\nstar.com\\nuAnalysts’ compensation is derived from Morningstar, \\nInc.’s overall earnings and consists of salary, bonus \\nand in some cases restricted stock.\\nuNeither Morningstar, Inc. or the Equity Research Group \\nreceives commissions for providing research nor do \\nthey charge companies to be rated.\\nuNeither Morningstar, Inc. or the Equity Research Group \\nis a market maker or a liquidity provider of the security \\nnoted within this report.\\nuNeither Morningstar, Inc. or the Equity Research Group \\nhas been a lead manager or co-lead manager over the \\nprevious 12-months of any publicly disclosed offer of \\nfinancial instruments of the issuer.\\nuMorningstar, Inc.’s investment management group \\ndoes have arrangements with financial institutions to \\nprovide portfolio management/investment advice some \\nof which an analyst may issue investment research re-\\nports on. However, analysts do not have authority over \\nMorningstar’s investment management group’s busi-\\nness arrangements nor allow employees from the in-\\nvestment management group to participate or influ-\\nence the analysis or opinion prepared by them.\\nMorningstar, Inc. is a publicly traded company (Ticker \\nSymbol: MORN) and thus a financial institution the se-\\ncurity of which is the subject of this report may own umore than 5% of Morningstar, Inc.’s total outstanding \\nshares. Please access Morningstar, Inc.’s proxy state-\\nment, “Security Ownership of Certain Beneficial Own-\\ners and Management” section https://\\nshareholders.morningstar.com/investor-relations/fin-\\nancials/sec-filings/default.aspx\\nuMorningstar, Inc. may provide the product issuer or its \\nrelated entities with services or products for a fee and \\non an arms’ length basis including software products \\nand licenses, research and consulting services, data \\nservices, licenses to republish our ratings and research \\nin their promotional material, event sponsorship and \\nwebsite advertising.\\nFurther information on Morningstar, Inc.’s conflict of in-\\nterest policies is available from https://\\nshareholders.morningstar.com Also, please note analysts \\nare subject to the CFA Institute’s Code of Ethics and \\nStandards of Professional Conduct.\\nFor a list of securities which the Equity Research Group \\ncurrently covers and provides written analysis on please \\ncontact your local Morningstar office. In addition, for his-\\ntorical analysis of securities covered, including their fair \\nvalue estimate, please contact your local office.\\nFor Recipients in Australia: This Report has been issued \\nand distributed in Australia by Morningstar Australasia \\nPty Ltd (ABN: 95 090 665 544; ASFL: 240892 ). Morning-\\nstar Australasia Pty Ltd is the provider of the general ad-\\nvice (‘the Service’) and takes responsibility for the produc-\\ntion of this report. The Service is provided through the re-\\nsearch of investment products.\\nTo the extent the Report contains general advice it has \\nbeen prepared without reference to an investor’s object-\\nives, financial situation or needs. Investors should con-\\nsider the advice in light of these matters and, if applic-\\nable, the relevant Product Disclosure Statement before \\nmaking any decision to invest. Refer to our Financial Ser-\\nvices Guide (FSG) for more information at http://\\nwww.morningstar.com.au/fsg.pdf\\nFor Recipients in New Zealand: This report has been is-\\nsued and distributed by Morningstar Australasia Pty Ltd \\nand/or Morningstar Research Ltd (together ‘Morning-\\nstar’). Morningstar is the provider of the regulated finan-\\ncial advice and takes responsibility for the production of \\nthis report. To the extent the report contains regulated \\nfinancial advice it has been prepared without reference to \\nan investor’s objectives, financial situation or needs. In-\\nvestors should consider the advice in light of these mat-\\nters and, if applicable, the relevant Product Disclosure \\nStatement before making any decision to invest. Refer to \\nour Financial Advice Provider Disclosure Statement at \\nwww.morningstar.com.au/s/fapds.pdf for more informa-tion.\\nFor Recipients in Hong Kong: The Report is distributed \\nby Morningstar Investment Management Asia Limited, \\nwhich is regulated by the Hong Kong Securities and Fu-\\ntures Commission to provide services to professional in-\\nvestors only. Neither Morningstar Investment Manage-\\nment Asia Limited, nor its representatives, are acting or \\nwill be deemed to be acting as an investment profession-\\nal to any recipients of this information unless expressly \\nagreed to by Morningstar Investment Management Asia \\nLimited. For enquiries regarding this research, please con-\\ntact a Morningstar Investment Management Asia Limited \\nLicensed Representative at https://shareholders.morning-\\nstar.com\\nFor recipients in India: This Investment Research is is-\\nsued by Morningstar Investment Adviser India Private \\nLimited. Morningstar Investment Adviser India Private \\nLimited is registered with the Securities and Exchange \\nBoard of India (Registration number INA000001357 ) and \\nprovides investment advice and research. Morningstar In-\\nvestment Adviser India Private Limited has not been the \\nsubject of any disciplinary action by SEBI or any other leg-\\nal/regulatory body. Morningstar Investment Adviser India \\nPrivate Limited is a wholly owned subsidiary of Morning-\\nstar Investment Management LLC. In India, Morningstar \\nInvestment Adviser India Private Limited has one asso-\\nciate, Morningstar India Private Limited, which provides \\ndata related services, financial data analysis and software \\ndevelopment. The Research Analyst has not served as an \\nofficer, director or employee of the fund company within \\nthe last 12 months, nor has it or its associates engaged in \\nmarket making activity for the fund company.\\n*The Conflicts of Interest disclosure above also applies to \\nrelatives and associates of Manager Research Analysts in \\nIndia # The Conflicts of Interest disclosure above also ap-\\nplies to associates of Manager Research Analysts in In-\\ndia. The terms and conditions on which Morningstar In-\\nvestment Adviser India Private Limited offers Investment \\nResearch to clients, varies from client to client, and are \\ndetailed in the respective client agreement.\\nFor recipients in Japan: The Report is distributed by Ib-\\nbotson Associates Japan, Inc., which is regulated by Fin-\\nancial Services Agency. Neither Ibbotson Associates Ja-\\npan, Inc., nor its representatives, are acting or will be \\ndeemed to be acting as an investment professional to any \\nrecipients of this information.\\nFor recipients in Singapore: For Institutional Investor \\naudiences only. Recipients of this report should contact \\ntheir financial professional in Singapore in relation to this \\nreport. Morningstar, Inc., and its affiliates, relies on cer-\\ntain exemptions (Financial Advisers Regulations, Section ',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 26 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®Research Methodology for Valuing Companies\\n32B and 32C) to provide its investment research to recipi-\\nents in Singapore.']}" ] }, "metadata": {}, "output_type": "display_data" } ], "source": [ "sys.path.append(os.path.join(os.curdir, '..'))\n", "from settings import pdf_content\n", "pdf_content = os.path.join('../', pdf_content)\n", "contents = pickle.load(open(pdf_content, 'rb'))\n", "contents" ] }, { "cell_type": "code", "execution_count": 14, "metadata": {}, "outputs": [], "source": [ "pages = contents['AMZN_Moodys_CreditRating_2023.pdf']" ] }, { "cell_type": "code", "execution_count": 24, "metadata": {}, "outputs": [ { "data": { "text/html": [ "
[\n",
       "│   \"CORPORATES\\nCREDIT OPINION\\n23 May 2023\\nUpdate\\nRATINGS\\nAmazon.com, Inc.\\nDomicile Seattle, Washington,\\nUnited States\\nLong Term Rating A1\\nType Senior Unsecured -\\nDom Curr\\nOutlook Stable\\nPlease see the ratings section  at the end of this report\\nfor more information. The ratings and outlook shown\\nreflect information as of the publication date.\\nContacts\\nChristina Boni +1.212.553.0514\\nSenior Vice President\\nchristina.boni@moodys.com\\nJack Myers +1.212.553.5116\\nAssociate Analyst\\njack.myers@moodys.com\\nMargaret Taylor +1.212.553.0424\\nAssociate Managing Director\\nmargaret.taylor@moodys.comAmazon.com, Inc.\\nUpdate to credit analysis\\nSummary\\nAmazon.com, Inc. 's (A1/Prime-1 stable) credit profile reflects its powerful global brand, which\\nis synonymous with online retail, as well as the strength and profitability of Amazon Web\\nServices (“AWS”), the market leader in the cloud computing market.\",\n",
       "│   \"The company is reliant\\non the operating income derived from AWS, as its non-AWS profitability has remained weak\\nsince the end of 2021. Although the company is making progress with improving productivity\\nand reducing costs, online operating margins remain well below historical levels. Amazon has\\ntaken actions to make its fulfillment operations more efficient as its business grows into its\\ncapacity, which doubled during the pandemic. Amazon has also built a solid ecosystem of\\nentertainment content that enhances its offering, operates a formidable third-party seller\\nbusiness and generates a solid and growing revenue stream from advertising. Nonetheless,\\nits credit metrics are currently weak for the A1 rating with RCF/Debt below 50%, as lower\\nprofitability, coupled with increased levels of investment have led to higher debt levels\\nand lower cash balances. Capital allocation will be critical to improving its credit profile as\\nAmazon navigates a weaker economic backdrop that could dampen demand for its products\\nand services as it pursues cost reductions and efficiencies to restore profitability at online\\nretail. The growing online presence of brick-and-mortar retailers, as well as the increasing\\ncompetition from larger, well capitalized companies in AWS' universe also presents future\\nchallenges.\",\n",
       "│   \"Exhibit 1\\nAmazon's debt has continued to rise as operating income remains below 2019\\n$0$20,000$40,000$60,000$80,000$100,000$120,000$140,000$160,000$180,000\\n$0$5,000$10,000$15,000$20,000$25,000$30,000\\n2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1 -23 LTM\\nMoody's Adjusted Debt (USD Millions)Moody's Adj. Operating Income (USD Millions)Moody's adjusted operating income Moody's adjusted debt\\nDebt includes lease\\nSource: Moody’s Financial Metrics™\"\n",
       "]\n",
       "
\n" ], "text/plain": [ "\u001b[1m[\u001b[0m\n", "\u001b[2;32m│ \u001b[0m\u001b[32m\"CORPORATES\\nCREDIT OPINION\\n23 May 2023\\nUpdate\\nRATINGS\\nAmazon.com, Inc.\\nDomicile Seattle, Washington,\\nUnited States\\nLong Term Rating A1\\nType Senior Unsecured -\\nDom Curr\\nOutlook Stable\\nPlease see the ratings section at the end of this report\\nfor more information. The ratings and outlook shown\\nreflect information as of the publication date.\\nContacts\\nChristina Boni +1.212.553.0514\\nSenior Vice President\\nchristina.boni@moodys.com\\nJack Myers +1.212.553.5116\\nAssociate Analyst\\njack.myers@moodys.com\\nMargaret Taylor +1.212.553.0424\\nAssociate Managing Director\\nmargaret.taylor@moodys.comAmazon.com, Inc.\\nUpdate to credit analysis\\nSummary\\nAmazon.com, Inc. 's \u001b[0m\u001b[32m(\u001b[0m\u001b[32mA1/Prime-1 stable\u001b[0m\u001b[32m)\u001b[0m\u001b[32m credit profile reflects its powerful global brand, which\\nis synonymous with online retail, as well as the strength and profitability of Amazon Web\\nServices \u001b[0m\u001b[32m(\u001b[0m\u001b[32m“AWS”\u001b[0m\u001b[32m)\u001b[0m\u001b[32m, the market leader in the cloud computing market.\"\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[32m\"The company is reliant\\non the operating income derived from AWS, as its non-AWS profitability has remained weak\\nsince the end of 2021. Although the company is making progress with improving productivity\\nand reducing costs, online operating margins remain well below historical levels. Amazon has\\ntaken actions to make its fulfillment operations more efficient as its business grows into its\\ncapacity, which doubled during the pandemic. Amazon has also built a solid ecosystem of\\nentertainment content that enhances its offering, operates a formidable third-party seller\\nbusiness and generates a solid and growing revenue stream from advertising. Nonetheless,\\nits credit metrics are currently weak for the A1 rating with RCF/Debt below 50%, as lower\\nprofitability, coupled with increased levels of investment have led to higher debt levels\\nand lower cash balances. Capital allocation will be critical to improving its credit profile as\\nAmazon navigates a weaker economic backdrop that could dampen demand for its products\\nand services as it pursues cost reductions and efficiencies to restore profitability at online\\nretail. The growing online presence of brick-and-mortar retailers, as well as the increasing\\ncompetition from larger, well capitalized companies in AWS' universe also presents future\\nchallenges.\"\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[32m\"Exhibit 1\\nAmazon's debt has continued to rise as operating income remains below 2019\\n$0$20,000$40,000$60,000$80,000$100,000$120,000$140,000$160,000$180,000\\n$0$5,000$10,000$15,000$20,000$25,000$30,000\\n2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1 -23 LTM\\nMoody's Adjusted Debt \u001b[0m\u001b[32m(\u001b[0m\u001b[32mUSD Millions\u001b[0m\u001b[32m)\u001b[0m\u001b[32mMoody's Adj. Operating Income \u001b[0m\u001b[32m(\u001b[0m\u001b[32mUSD Millions\u001b[0m\u001b[32m)\u001b[0m\u001b[32mMoody's adjusted operating income Moody's adjusted debt\\nDebt includes lease\\nSource: Moody’s Financial Metrics™\"\u001b[0m\n", "\u001b[1m]\u001b[0m\n" ] }, "metadata": {}, "output_type": "display_data" } ], "source": [ "splits=splitter.split_text(pages[0])\n", "pprint(splits)" ] }, { "cell_type": "code", "execution_count": 8, "metadata": {}, "outputs": [], "source": [ "# now let's create the splits for every document\n", "contents_splits = {}\n", "for fname, content in contents.items():\n", " splits = [splitter.split_text(page) for page in content]\n", " contents_splits[fname] = [split for sublist in splits for split in sublist]" ] }, { "cell_type": "code", "execution_count": 9, "metadata": {}, "outputs": [ { "data": { "text/plain": [ "{'AMZN_Moodys_CreditRating_2023.pdf': [\"CORPORATES\\nCREDIT OPINION\\n23 May 2023\\nUpdate\\nRATINGS\\nAmazon.com, Inc.\\nDomicile Seattle, Washington,\\nUnited States\\nLong Term Rating A1\\nType Senior Unsecured -\\nDom Curr\\nOutlook Stable\\nPlease see the ratings section at the end of this report\\nfor more information. The ratings and outlook shown\\nreflect information as of the publication date.\\nContacts\\nChristina Boni +1.212.553.0514\\nSenior Vice President\\nchristina.boni@moodys.com\\nJack Myers +1.212.553.5116\\nAssociate Analyst\\njack.myers@moodys.com\\nMargaret Taylor +1.212.553.0424\\nAssociate Managing Director\\nmargaret.taylor@moodys.comAmazon.com, Inc.\\nUpdate to credit analysis\\nSummary\\nAmazon.com, Inc. 's (A1/Prime-1 stable) credit profile reflects its powerful global brand, which\\nis synonymous with online retail, as well as the strength and profitability of Amazon Web\\nServices (“AWS”), the market leader in the cloud computing market.\",\n", " \"The company is reliant\\non the operating income derived from AWS, as its non-AWS profitability has remained weak\\nsince the end of 2021. Although the company is making progress with improving productivity\\nand reducing costs, online operating margins remain well below historical levels. Amazon has\\ntaken actions to make its fulfillment operations more efficient as its business grows into its\\ncapacity, which doubled during the pandemic. Amazon has also built a solid ecosystem of\\nentertainment content that enhances its offering, operates a formidable third-party seller\\nbusiness and generates a solid and growing revenue stream from advertising. Nonetheless,\\nits credit metrics are currently weak for the A1 rating with RCF/Debt below 50%, as lower\\nprofitability, coupled with increased levels of investment have led to higher debt levels\\nand lower cash balances. Capital allocation will be critical to improving its credit profile as\\nAmazon navigates a weaker economic backdrop that could dampen demand for its products\\nand services as it pursues cost reductions and efficiencies to restore profitability at online\\nretail. The growing online presence of brick-and-mortar retailers, as well as the increasing\\ncompetition from larger, well capitalized companies in AWS' universe also presents future\\nchallenges.\",\n", " \"Exhibit 1\\nAmazon's debt has continued to rise as operating income remains below 2019\\n$0$20,000$40,000$60,000$80,000$100,000$120,000$140,000$160,000$180,000\\n$0$5,000$10,000$15,000$20,000$25,000$30,000\\n2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1 -23 LTM\\nMoody's Adjusted Debt (USD Millions)Moody's Adj. Operating Income (USD Millions)Moody's adjusted operating income Moody's adjusted debt\\nDebt includes lease\\nSource: Moody’s Financial Metrics™\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nCredit strengths\\n»Leading online retailer and cloud provider\\n»AWS provides an increasing income stream provides solid positioning in AI\\n»Prime membership base supports customer loyalty\\n»Advertising revenue remains a significant area of growth\\nCredit challenges\\n»Brick-and-mortar retailers continue to increase online retail presence\\n»Heightened cloud competition from larger, well capitalized tech companies\\n»Inefficiencies in its retail fulfillment operations weigh on profitability\\n»Reduced cash balance lowers cushion for volatile or heavy investment periods\\nRating outlook\\nThe stable outlook reflects our view that Amazon will quickly restore its credit metrics to levels reflective of its A1 rating. The outlook\\nalso assumes that Amazon will maintain excellent liquidity and consistent financial strategies.\\nFactors that could lead to an upgrade\\n»Ratings could be upgraded if Amazon's numerous investments generate commensurate levels of profitability such that RCF/debt is\\nmaintained around 65%.\\n»Additional factors that would be critical for an upgrade are the continued maintenance of very strong liquidity, a robust cash and\\ninvestments to debt position and maintenance of conservative financial strategies.\",\n", " 'Factors that could lead to a downgrade\\nRatings could be downgraded if:\\n»Operating performance continues to weaken, or\\n»It becomes clear that investments are not paying off, or\\n»Financial strategy is becoming significantly more aggressive with regard to cash returned to shareholders or acquisitions\\n»If for any of the above, RCF/debt falls below 50% for an extended period\\nThis publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the issuer/deal page on https://ratings.moodys.com for the\\nmost updated credit rating action information and rating history.\\n2 23 May 2023 Amazon.com, Inc.: Update to credit analysis',\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nKey indicators\\nExhibit 2\\nAmazon.com, Inc.\\nUS Billions Dec-18 Dec-19 Dec-20 Dec-21 Dec-22LTM \\n(Mar-23)12-18 Month \\nForward View\\nRevenue 233 281 386 470 514 525 589\\nEBIT / Interest Expense 5.9x 6.8x 10.2x 9.6x 2.8x 2.9x 5.9x\\nRCF / Net Debt 87.7% 90.9% 81.4% 62.8% 53.9% 50.7% 90.2%\\nDebt / EBITDA 2.3x 2.2x 2.1x 2.3x 3.6x 3.6x 2.4x\\nAll figures and ratios are calculated using Moody’s estimates and standard adjustments. Moody's Forecasts (f) or Projections (proj.) are Moody's opinion and do not represent the views of\\nthe issuer. Periods are Financial Year-End unless indicated.\",\n", " \"Periods are Financial Year-End unless indicated. LTM = Last Twelve Months.\\nSource: Moody’s Financial Metrics™\\nProfile\\nHeadquartered in Seattle, Washington, Amazon.com, Inc. is the world’s largest online retailer, and also a leading web services provider\\nvia AWS. Revenue was approximately $525 billion for the twelve months ended March 31, 2023.\\nExhibit 3\\nAmazon's Revenue by SegmentExhibit 4\\nAmazon's Operating Profit by Segment\\n$107,006 $135,987 $177,866 $232,887 $280,522 $386,064 $469,822 $513,983 $524,897 \\n $(50,000) $50,000 $150,000 $250,000 $350,000 $450,000 $550,000\\n2015 2016 2017 2018 2019 2020 2021 2022 Q1-23\\nLTMRevenue (USD Millions)North America International AWS\\nSource: Company SEC Filings$2,233 $4,186 $4,106 $12,420 $14,541 $22,899 $24,879 \\n$12,248 \\n$13,\",\n", " \"541 $22,899 $24,879 \\n$12,248 \\n$13,353 \\n $(10,000) $(7,500) $(5,000) $(2,500) $- $2,500 $5,000 $7,500 $10,000 $12,500 $15,000 $17,500 $20,000 $22,500 $25,000 $27,500 $30,000\\n2015 2016 2017 2018 2019 2020 2021 2022 Q1-23\\nLTMOperating Income (USD Millions)North America International AWS\\nSource: Company SEC Filings\\nDetailed credit considerations\\nAWS has leading market share, high profitability and solid long term prospects\\nAWS continues to generate most of Amazon's operating profit, making it possible for investment programs (delivery, content and\\ninternational) to continue. Despite still being relatively early in the conversion of companies transitioning to the cloud, revenue\\ngrowth and profitability of AWS continues to experience a slowing of growth in Q1 2023 as companies try to find more effective\\ncost solutions.\",\n", " 'Revenue growth in Q1 2023 has decelerated to 15.8% from 20.2% in Q4 2022 and 27.5% in Q3 2022, as operating\\nmargins decline sequentially and from last year. These trends have continued into Q2 2023 with April revenue growth rates lower than\\nQ1 2023. We expect revenue growth to improve toward the end of 2023 as optimization efforts of customers are exhausted. AWS’\\ncustomers continue to increase commitments for future capacity usage and we expect strong long-term growth for AWS benefiting\\nfrom migration of IT infrastructure investments from on-premise to the cloud. AWS is also well-positioned to capitalize on the rapidly\\ngrowing AI opportunity in the cloud with its scalable infrastructure, tools for developers to build and deploy models and services that\\ncustomers can use to leverage proprietary large language models. At the same time, AWS faces strong competitors with financial\\nresources such as Microsoft Corporation (Aaa Stable), Oracle Corporation (Baa2 Stable), Alphabet Inc. (Aa2 Stable), and IBM (A3\\nStable) that all aim to grow market share.',\n", " 'Operating margin expansion for AWS could be challenged by increasing competition and\\nelevated investments.\\n3 23 May 2023 Amazon.com, Inc.: Update to credit analysis',\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nOnline retail presence still dominates as digital efforts of brick and mortar accelerate\\nAmazon's online retail is the clear leader relative its US competitors. Nonetheless, competition has accelerated from larger players such\\nas Walmart Inc. (Aa2 stable), Target Corporation (A2 stable) and Best Buy Co., Inc. (A3 stable), all of which have continued to enhance\\ntheir online capabilities. These larger brick-and-mortar retailers can also leverage their store networks and proprietary distribution\\ncapability to offer the consumer options for obtaining their purchases. In store pickup provides a competitive offering (within hours\\nin most cases) and a more cost effective alternative to the seller. In addition, some brick-and-mortar retailers already have vehicle\\nnetworks that are used to stock its stores which could be used for some same day delivery capability. An example is the auto parts\\nretailers, which measure delivery times in hours, not days.\\nAmazon faces an increasingly competitive environment as the pandemic accelerated investment in areas such as curbside pickup,\\ninventory visibility and better usage of stores to fulfill orders.\",\n", " 'To combat these growing competitive threats, Amazon continues to\\nsupport its Prime Free One-Day Delivery initiative, which is an effort to counter buy-online/pick-up in store. The company is also\\nmoving its fulfillment network to a regionalized model which is expected to improve delivery speed and cost. To offset rising costs, the\\ncompany increased pricing on its prime membership in the U.S. in 2022 from $119 to $139 annually. The move, which is the first price\\nincrease since 2018 and will provide to offset to these continued investments.\\nThird-party sales remains an important part of the business with growth continuing to outpace first-party. Third party comprises\\n59% of paid units relative to 55% for the same period last year. The company has implemented a fuel and inflation as well as a peak\\nfulfillment surcharge on fulfillment fee per unit rates for Fulfilled by Amazon sellers in the face of rising inflation and energy costs. We\\nnote that Walmart has increased its third party efforts with its Advance Auto Parts and Shopify relationships. In the Advance example,\\nWalmart is providing space in its stores, as well as the use of its distribution network and placement on the website.',\n", " 'Physical store sales remain primarily from Whole Foods. The 2017 acquisition of Whole Foods consisting now of over 500 locations\\nprovides Amazon with a “scalable” food business, as well as pickup points for online orders across categories. The company has closed\\nsome non-core concepts including its physical bookstores, and 4-star stores.\\nAdvertising revenue continues to grow rapidly in programmatic advertising and, in our opinion, has an advantage in this area given\\nits significant e-commerce presence and data gatheri ng. Growth in advertising revenue remains robust at over 23% in Q1 2023.\\nAdvertising for LTM March 2023 was roughly $39.4 billion, and we note advertising operating margins are generally healthy and\\ntypically run in the midteens. Along with AWS, the profitability of this category provides “buffer” to support its retail operations\\nperforming well below historical operating margins.',\n", " \"Cost pressures are being addressed as investment is targeted at or below 2022 levels\\nAmazon's retail operations is contending with the inefficiency posed by the more than doubling of its capacity during the pandemic,\\nAmazon continues to work to move its cost structure closer to pre-pandemic levels and has made significant head count reduction\\nwith 27,000 roles eliminated including areas such as AWS as well as Twitch, devices, advertising and human resources.\\nAmazon remains committed to providing value to customers, despite inflation while slowing remaining elevated. The company is\\nbenefiting from continued improvement in shipping speeds and in-stock rates have recovered. Amazon has been contending with\\nhigher costs related to system productivity and inflation since the second half of 2021.\\nDuring first quarter 2023, Amazon continued to take cost cutting measures to improve margins and make progress on reducing its\\ncash usage. These efforts include shutting down businesses such as Amazon Fabric and Amazon Care as well as closing eight Amazon\\nGo locations. The company has also increased its minimum grocery purchases from $35 to $150 for free shipping and reduced\\ncorporate head count.\",\n", " 'Nonetheless, cost structure improvements have been partially offset by increased spend in advertising and other\\ninvestments such as video content and marketing costs.\\nAmazon expects investment in 2023 to be at or below 2022 levels at it reduces its spending on fulfillment and transportation given\\nits significant increase in capacity in recent years and shifts spending to technology and related infrastructure including large language\\nmodels and generative AI. In 2022, the company spent approximately $59 billion in capital investments.\\nAmazon has continued to pursue acquisitions it has exited businesses that are not reaching long term return goals. The company\\nacquired MGM Holdings Inc. (“MGM”) for approximately $8.5 billion, including MGM’s debt, in Q1 2022 which increased its video\\n4 23 May 2023 Amazon.com, Inc.: Update to credit analysis',\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\ncontent which is a key component to its Prime's value proposition and differentiates its offering beyond shipping. MGM's revenue of\\nabout $1.5 billion represents less than 1% of Amazon's revenue. The company also closed in Q1 2023 on its $4 billion purchase of\\n1Life Healthcare Inc. “One Medical,” a national primary care provider with approximately $1 billion of LTM revenue as of December\\n2022. One Medical operates a chain of primary healthcare clinics. The business is based on a membership model where the company\\ncharges a fixed monthly subscription fee and in exchange provides regular primary care services. The company focuses on both physical\\nappointments and digital offerings. The company also has announced its intention to acquire iRobot for approximately $1.9 billion. The\\npurchase is currently still being reviewed by the FTC.\\nWe estimate that Amazon's RCF/debt can return to near our target of 50% RCF/debt at the end of 2023 to the extent that Amazon\\nprioritizes aligning free cash flow generation with its investments.\",\n", " \"Our estimates assumes that free cash flow is positive and utilized to\\nreduce funded debt. Nonetheless, the economic back drop remains weak which poses a need for continued capital allocation discipline\\nto achieve this goal. We also recognize that cash+short term investments as a percentage of debt remains below historical levels.\\nExhibit 5\\nRetained cash flow to debt expected to recover in the next 12-18 months\\n20%25%30%35%40%45%50%55%60%65%70%\\n2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1-23 LTM 12-18 Months\\nForward ViewUp Trigger Down Trigger RCF/Debt\\nCredit metrics reflect Moody's standard adjustments\\nSource: Moody’s Financial Metrics™, Moody's estimates\\nESG considerations\\nAmazon.com, Inc.\",\n", " \"'s ESG Credit Impact Score is Neutral-to-Low CIS-2\\nExhibit 6\\nESG Credit Impact Score\\nSource: Moody's Investors Service\\n(CIS-2 ) Amazon's ESG Credit Impact Score reflects our assessment that its governance practices which include maintaining high cash\\nbalances positions the company to meet its moderate exposure to environmental and social risks.\\n5 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nExhibit 7\\nESG Issuer Profile Scores\\nSource: Moody's Investors Service\\nEnvironmental\\n(E-3) Amazon's environmental risks reflect exposure to carbon transition risk as product transport, which currently relies primarily on\\ncombustion engine vehicles, remains integral to its operations. The company continues to invest in EV and is committed to growing\\nits EV fleet. Its physical climate risk is low as its operations are well diversified within the US and internationally. Natural capital risk is\\nviewed as low given its business diversification through AWS despite its sales of food and apparel.\\nSocial\\n(S-3) Amazon's social risk reflects its exposure to human capital, customer relations and responsible production. Human capital risk\\nhigher than most retailers, as AWS requires a more highly skilled workforce. The company’s exposure to risk related to demographic\\nand societal trends is lower than the that of the overall retail and apparel industry. Amazon remains poised to benefit from the\\ncontinued shift of consumers transacting online and the robust demand for IT infrastructure and the continued adoption of cloud\\nservices. Its business diversification with AWS and its significant volume with third party sellers lowers its responsible production risk.\",\n", " \"Its business diversification with AWS and its significant volume with third party sellers lowers its responsible production risk.\\nData privacy issues surrounding both its online and web services segments increases customer relations risk.\\nGovernance\\n(G-2) Amazon's governance risk reflects its overall conservative financial policies, including the maintenance of high cash balances and\\nlimited shareholder distributions to date and its moderate leverage. The company has separate chairperson and CEO roles with Jeff\\nBezos as Chairman.\\nESG Issuer Profile Scores and Credit Impact Scores for the rated entity/transaction are available on Moodys.com. To view the latest\\nscores, please click here to go to the landing page for the entity/transaction on MDC and view the ESG Scores section.\\nLiquidity analysis\\nAmazon maintains strong liquidity from its significant cash balances, which provides the company with increased flexibility and this\\nremains a critical credit consideration. In January 2023, Amazon issued an $8 billion 364-day term loan to partially fund the One\\nMedical acquisition which closed February 2023. The company issued $12.75 billion of debt securities in April 2022 and $8.25 billion\\nin December 2022 ranging in maturity from 2024 to 2062.\",\n", " \"The use of proceeds were for general corporate purposes. We expect\\npositive free cash flow to be applied to debt reduction supported by improved working capital and better profitability at its non-AWS\\noperations.\\nIn March 2022, the company expanded its US commercial paper program to $20 billion. The commercial paper program includes the\\noption to issue €3 billion and is backed by a $10 billion revolving credit facility expiring March 29, 2025 as well as a $10 billion 364-day\\ncredit facility which was put in place on November 18, 2022 and may be extended once. As of March 31, 2023 the company had $7.8\\nbillion of commercial paper outstanding under its programs. A significant credit consideration to its short term and long term ratings\\nis Amazon's commitment to fully cover all commercial paper balances with the availability under its committed revolvers and excess\\nsame-day available cash balances. The commercial paper program is likely to be used to bridge working capital swings and adds to its\\nformidable liquidity profile. The revolving credit facility has same day availability, no ongoing MAC clause and no financial covenants.\\n6 23 May 2023 Amazon.com, Inc.\",\n", " '6 23 May 2023 Amazon.com, Inc.: Update to credit analysis',\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nRating methodology and scorecard factor\\n \\nThe following table shows Amazon.com, Inc.'s scorecard-indicated outcome using Retail Industry, with data as of March 31, 2023 and\\non a forward-looking basis. Applying Moody's 12-18 month forward view, the scorecard indicated outcome is A1, the same level as its\\nsenior unsecured rating.\\nExhibit 8\\nRetail Industry Scorecard [1][2] \\nFactor 1 : Scale (10%) Measure Score Measure Score\\na) Revenue (USD Billion) $524.9 Aaa $588.6 Aaa\\nFactor 2 : Business Profile (30%)\\na) Stability of Product Aa Aa Aa Aa\\nb) Execution and Competitive Position Aa Aa Aa Aa\\nFactor 3 : Leverage and Coverage (45%)\\na) EBIT / Interest Expense 2.9x Ba 5.9x Baa\\nb) RCF / Net Debt 50.7% Aa 90.2% Aa\\nc) Debt / EBITDA 3.6x Ba 2.\",\n", " \"6x Ba 2.4x A\\nFactor 4 : Financial Policy (15%)\\na) Financial Policy A A A A\\nRating: \\na) Scorecard-Indicated Outcome A2 A1\\nb) Actual Rating Assigned A1Current \\nLTM 3/31/2023Moody's 12-18 Month Forward View\\nAs of 5/16/2023 [3]\\n[1] All ratios are based on 'Adjusted' financial data and incorporate Moody's Global Standard Adjustments for Non-Financial Corporations.\\n[2] As of 3/31/2023 (L).\\n[3] This represents Moody's forward view; not the view of the issuer; and unless noted in the text, does not incorporate significant acquisitions and divestitures.\\nSource: Moody's Financial Metrics™, Moody's estimates\\n7 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\n \\nRatings\\nExhibit 9\\nCategory Moody's Rating\\nAMAZON.COM, INC.\\nOutlook Stable\\nSenior Unsecured A1\\nCommercial Paper P-1\\nWHOLE FOODS MARKET, INC.\\nOutlook Stable\\nSenior Unsecured A1\\nSource: Moody's Investors Service\\n8 23 May 2023 Amazon.com, Inc.: Update to credit analysis\",\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\nAppendix\\nExhibit 10\\n(in US Millions)FYE\\nDec-18FYE\\nDec-19FYE\\nDec-20FYE\\nDec-21FYE\\nDec-22LTM Ending\\nMar-23\\nAs Reported Debt49,289 24,719 32,971 50,235 70,149 69,084\\nOperating Leases 21,442 52,814 67,533 82,083 84,823 85,695\\nNon-Standard Adjustments 101 101 725 725 6,800 15,800\\nMoody's-Adjusted Debt 70,832 77,634 101,229 133,043 161,772 170,579Moody's-Adjusted Debt Breakdown\\nAmazon.com, Inc.\\nAll figures are calculated using Moody’s estimates and standard adjustments.\",\n", " \"All figures are calculated using Moody’s estimates and standard adjustments.\\nSource: Moody’s Financial Metrics™\\nExhibit 11\\n(in US Millions)FYE\\nDec-18FYE\\nDec-19FYE\\nDec-20FYE\\nDec-21FYE\\nDec-22LTM Ending\\nMar-23\\nAs Reported EBITDA 28,028 31,277 42,589 63,385 21,956 32,278\\nOperating Leases 3,400 3,669 5,019 7,199 8,847 9,256\\nUnusual 0 0 0 -11,526 13,870 5,625\\nMoody's-Adjusted EBITDA 31,428 34,946 47,608 59,058 44,673 47,159Moody's-Adjusted EBITDA Breakdown\\nAmazon.com, Inc.\\nAll figures are calculated using Moody’s estimates and standard adjustments.\",\n", " 'All figures are calculated using Moody’s estimates and standard adjustments.\\nSource: Moody’s Financial Metrics™\\nExhibit 12\\nPeer snapshot\\n(in US millions)FYE\\nDec-21FYE\\nDec-22LTM\\nMar-23FYE\\nJan-21FYE\\nJan-22FYE\\nJan-23FYE\\nDec-21FYE\\nDec-22LTM\\nMar-23FYE\\nAug-21FYE\\nAug-22LTM\\nFeb-23FYE\\nMay-21FYE\\nMay-22LTM\\nFeb-23\\nRevenue $469,822 $513,983 $524,897 $559,151 $572,754 $611,289 $257,637 $282,836 $284,612 $195,929 $226,954 $234,390 $40,479 $42,440 $47,957\\nEBITDA $59,058 $44,673 $47,159 $36,657 $39,032 $37,233 $91,935 $94,469 $93,141 $8,928 $10,195 $10,493 $19,363 $19,268 $19,314\\nTotal Debt $133,',\n", " '493 $19,363 $19,268 $19,314\\nTotal Debt $133,043 $161,772 $170,579 $71,299 $57,323 $60,496 $34,992 $35,777 $36,292 $11,407 $10,906 $10,931 $93,460 $85,145 $101,097\\nCash & Cash Equiv. $36,220 $53,888 $49,343 $17,741 $14,760 $8,625 $20,945 $21,879 $25,924 $11,258 $10,203 $12,970 $30,098 $21,383 $8,219\\nEBITDA Margin 12.6% 8.7% 9.0% 6.6% 6.8% 6.1% 35.7% 33.4% 32.7% 4.6% 4.5% 4.5% 47.8% 45.4% 40.3%\\nEBIT / Int. Exp. 9.6x 2.8x 2.9x 7.4x 9.',\n", " '6x 2.8x 2.9x 7.4x 9.5x 8.3x 93.9x 84.1x 82.4x 29.7x 36.7x 39.1x 6.1x 5.4x 3.9x\\nDebt / EBITDA 2.3x 3.6x 3.6x 1.9x 1.5x 1.6x 0.4x 0.4x 0.4x 1.3x 1.1x 1.0x 4.8x 4.4x 5.2x\\nRCF / Net Debt 62.8% 53.9% 50.7% 43.5% 60.2% 40.8% 679.1% 691.3% 906.6% 1446.4% 1011.0% -364.5% 21.4% 13.7% 14.5%\\nFCF / Debt -19.5% -15.4% -8.',\n", " '5%\\nFCF / Debt -19.5% -15.4% -8.9% 26.2% 6.9% 8.0% 194.0% 167.7% 170.6% -3.9% 14.8% 32.4% 11.4% 1.8% 3.8%A1 Stable Aa2 Stable Aa2 Stable Aa3 Stable Baa2 StableAmazon.com, Inc. Walmart Inc. Alphabet Inc. Costco Wholesale Corporation Oracle Corporation\\nAll figures & ratios calculated using Moody’s estimates & standard adjustments. FYE = Financial Year-End. LTM = Last Twelve Months. RUR* = Ratings under Review, where UPG = for\\nupgrade and DNG = for downgrade.\\nSource: Moody’s Financial Metrics™\\n9 23 May 2023 Amazon.com, Inc.: Update to credit analysis',\n", " \"MOODY'S INVESTORS SERVICE CORPORATES\\n© 2023 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.\\nCREDIT RATINGS ISSUED BY MOODY'S CREDIT RATINGS AFFILIATES ARE THEIR CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT\\nCOMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY MOODY’S (COLLECTIVELY,\\n“PUBLICATIONS”) MAY INCLUDE SUCH CURRENT OPINIONS. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL\\nFINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE APPLICABLE MOODY’S\\nRATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY’S\\nCREDIT RATINGS.\",\n", " 'CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE\\nVOLATILITY. CREDIT RATINGS, NON-CREDIT ASSESSMENTS (“ASSESSMENTS”), AND OTHER OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT\\nSTATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND\\nRELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. AND/OR ITS AFFILIATES. MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER\\nOPINIONS AND PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER\\nOPINIONS AND PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES.',\n", " 'MOODY’S CREDIT\\nRATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR.\\nMOODY’S ISSUES ITS CREDIT RATINGS, ASSESSMENTS AND OTHER OPINIONS AND PUBLISHES ITS PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING\\nTHAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE,\\nHOLDING, OR SALE.\\nMOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE\\nRECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING\\nAN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.',\n", " 'ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED\\nOR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE\\nFOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN\\nCONSENT.\\nMOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS\\nDEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.\\nAll information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well\\nas other factors, however, all information contained herein is provided “AS IS” without warranty of any kind.',\n", " \"MOODY'S adopts all necessary measures so that the information it\\nuses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However,\\nMOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the credit rating process or in preparing its Publications.\\nTo the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any\\nindirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any\\nsuch information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or\\ndamages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a\\nparticular credit rating assigned by MOODY’S.\",\n", " 'To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory\\nlosses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the\\navoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents,\\nrepresentatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.\\nNO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT\\nRATING, ASSESSMENT, OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.',\n", " 'Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including\\ncorporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any credit rating,\\nagreed to pay to Moody’s Investors Service, Inc. for credit ratings opinions and services rendered by it fees ranging from $1,000 to approximately $5,000,000. MCO and Moody’s\\nInvestors Service also maintain policies and procedures to address the independence of Moody’s Investors Service credit ratings and credit rating processes. Information regarding\\ncertain affiliations that may exist between directors of MCO and rated entities, and between entities who hold credit ratings from Moody’s Investors Service, Inc.',\n", " 'and have also\\npublicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance\\n— Charter Documents - Director and Shareholder Affiliation Policy.”\\nAdditional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors\\nService Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended\\nto be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you\\nrepresent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or\\nindirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001.',\n", " \"MOODY’S credit rating is an opinion as to\\nthe creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.\\nAdditional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s\\nOverseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally\\nRecognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an\\nentity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered\\nwith the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.\",\n", " '2 and 3 respectively.\\nMJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred\\nstock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any credit rating, agreed to pay to MJKK or MSFJ (as applicable) for credit ratings opinions and services\\nrendered by it fees ranging from JPY100,000 to approximately JPY550,000,000.\\nMJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.\\nREPORT NUMBER 1366931\\n10 23 May 2023 Amazon.com, Inc.: Update to credit analysis'],\n", " 'ATT_SEC_AnnualReport_2022.pdf': ['AT&T Inc. 2022 Annual Report \\nConnecting changes everything\\nF1157donD1R1.indd 1-3 3/2/23 12:50 PM',\n", " 'Our purpose \\nConnecting people \\nto greater possibility — with expertise, simplicity and inspiration.\\nF1157donD1R1.indd 4-6 3/7/23 5:15 PM',\n", " '11\\nTo our shareholders\\n2022 was a year of major change for AT&T, and we are proud to have ended \\nthe year in a stronger position. The realities of our industry, changing consumer expectations and an evolving macroeconomic environment dictated our need ¹ÂÅ\\x03´\\x03ƼÀÿ¼è¸·\\x03ÂøŴǼÁº\\x03À·¸¿\\x03´Á·\\x03Æ»´ÅÃ\\x03¸Ë¸¶ÈǼÂÁ\\x04\\x03\\nThat’s why we made the structural moves we did to reposition our company, \\nincluding successfully completing the separation of WarnerMedia.',\n", " 'We have ¶ÂÁè·¸Á¶¸\\x03Ç»¸Å¸\\x03¼Æ\\x03´\\x03µÅ¼º»Ç\\x03¹ÈÇÈŸ\\x03¹ÂÅ\\x03´Á\\x03\\x9a\\xad\\x86\\xad\\x03Ç»´Ç\\x03·¸¿¼É¸ÅÆ\\x03Ç»¸\\x03µ¸ÆÇ\\x03 ¼Á\\x03¶ÂÁÁ¸¶Ç¼É¼ÇÌ\\x04\\nConnectivity is ingrained in our legacy going back nearly 150 years.',\n", " 'We have \\nthe assets, talent and experience to ¶ÂÁÁ¸¶Ç\\x03øÂÿ¸\\x03ÇÂ\\x03ºÅ¸´Ç¸Å\\x03ÃÂÆƼµ¼¿¼ÇÌ\\x03ʼǻ\\x03ƼÀÿ¼¶¼ÇÌ\\x06\\x03¸ËøÅǼƸ\\x03´Á·\\x03¼ÁÆüŴǼÂÁ \\x04\\x03¢Á\\x03\\x1e\\x1c\\x1e\\x1e\\x06\\x03ʸ\\x03Êž¸·\\x03ÇÂ\\x03¹È¿è¿¿\\x03Ç»¼Æ\\x03\\npurpose in 3 ways:\\n\\x1d\\x04 We ºÅ¸Ê\\x03¶ÈÆÇÂÀ¸Å\\x03Ÿ¿´Ç¼ÂÁÆ»¼ÃÆ at a near record-setting pace, taking full \\n advantage of all-time-high levels of demand for strong, reliable connectivity.',\n", " '\\x04 We were ¸æ¸¶Ç¼É¸\\x03´Á·\\x03¸ï¶¼¸ÁÇ\\x03¼Á\\x03ÂÈÅ\\x03ÂøŴǼÂÁÆ, reaching more than \\n$5 billion of our 3-year, $6 billion-plus run-rate cost transformation target. \\n\\x1f\\x04 Our ·¸¿¼µ¸Å´Ç¸\\x03¶´Ã¼Ç´¿\\x03´¿¿Â¶´Ç¼ÂÁ\\x03ÆÇŴǸºÌ enabled us to invest in 5G and \\n\\x03 赸Å\\x03´Ç\\x03»¼ÆÇÂż¶\\x03¿¸É¸¿Æ\\x06\\x03Ÿ·È¶¸\\x03ÂÈÅ\\x03Á¸Ç\\x03·¸µÇ\\x03µÌ\\x03´µÂÈÇ\\x03]\\x1e \\x03µ¼¿¿¼ÂÁ\\x03´Á·\\x03ƸÇ\\x03ÈÃ\\x03\\x03\\na structure we believe will drive better returns for you, our shareholders.',\n", " '1\\nThis includes continuing to provide an attractive dividend.\\n\\x9cÂÁƼÆǸÁ¶Ì\\x03¼Á\\x03ÂøŴǼÂÁ´¿\\x03¸Ë¶¸¿¿¸Á¶¸\\x03\\nDescribing our go-to-market strategy is as simple as the strategy itself. Be\\n¶ÂÁƼÆǸÁÇ\\x03ʼǻ\\x03ÂÈÅ\\x03Âæ¸ÅÆ\\x03ÇÂ\\x03ÂÈÅ\\x03¶ÈÆÇÂÀ¸ÅÆ\\x06\\x03´Á·\\x03À´¾¸\\x03¼Ç\\x03¸´ÆÌ\\x03¹ÂÅ\\x03Ç»¸À\\x03ÇÂ\\x03·Â\\x03business with us.',\n", " 'Wireless\\n¢Á\\x03®\\x04¬\\x04\\x03ʼŸ¿¸ÆÆ, w\\n e attracted nearly \\x1e\\x04%\\x03À¼¿¿¼ÂÁ\\x03ÃÂÆÇô¼·\\x03ûÂÁ¸\\x03Á¸Ç\\x03´··¼Ç¼ÂÁÆ\\x03\\n¼Á\\x03\\x1e\\x1c\\x1e\\x1e, marking our second-best annual results in more than a decade, behind \\nonly 2021. We also ºÅ¸Ê\\x03ʼŸ¿¸ÆÆ\\x03ƸÅɼ¶¸\\x03ŸɸÁȸÆ\\x03µÌ\\x03ÀŸ\\x03Ç»´Á\\x03!Y year over year, representing a multi-year high.',\n", " 'And we did this while continuing to ¶ÂÁ¶¸ÁÇŴǸ\\x03ÂÁ\\x03ÃÅÂèÇ´µ¼¿¼ÇÌ\\x06\\x03¼Á¶Å¸´Æ¼Áº\\x03ʼŸ¿¸ÆÆ\\x03\\x9e\\x9b¢\\xad\\x9d\\x9a\\x03µÌ\\x03Á¸´Å¿Ì\\x03 Y\\x03´Á·\\x03´¶»¼¸É¼Áº\\x03ÂÈÅ\\x03ÀÂÆÇ\\x03ÃÅÂèÇ´µ¿¸\\x03̸´Å\\x03ÂÁ\\x03Ÿ¶ÂÅ· .\\n2 We are also a ¿¸´·¸Å\\x03¼Á\\x03Ç»¸\\x03\\n¢ÁǸÅÁ¸Ç\\x03¹\\x03\\xad»¼ÁºÆ\\x03\\x8b¢Â\\xad\\x8c.',\n", " 'We added more than 12 million connected devices in \\x1e\\x1c\\x1e\\x1e\\x06\\x03µ¸¶ÂÀ¼Áº\\x03Ç»¸\\x03èÅÆÇ\\x03®\\x04¬\\x04\\x03¶´Åż¸Å\\x03ÇÂ\\x03¸Ë¶¸¸·\\x03\\x1d\\x1c\\x1c\\x03À¼¿¿¼ÂÁ\\x03¶ÂÁÁ¸¶Ç¸·\\x03·¸É¼¶¸Æ\\x04\\x03\\x03\\x03\\x03\\x03£Â»Á\\x03¬Ç´Á¾¸Ì \\n\\x9c»¼¸¹\\x03\\x9e˸¶ÈǼɸ\\x03¨ï¶¸Å\\nF1157donD2R1.indd 1F1157donD2R1.indd 1 3/1/23 7:14 PM3/1/23 7:14 PM',\n", " 'AT&T Inc. 2022 Annual Report 2\\n¨ÈÅ\\x03ʼŸ¿¸ÆÆ\\x03ÀÂÀ¸ÁÇÈÀ\\x03Ê´Æ\\x03´\\x03·¼Å¸¶Ç\\x03ŸÆÈ¿Ç\\x03¹\\x03ÂÈÅ\\x03ƼÀÿ¼è¸·\\x03É´¿È ¸\\x03ÃÅÂÃÂƼǼÂÁ\\x06\\x03\\n¿ÂʸÅ\\x03´¶ÄȼƼǼÂÁ\\x03¶ÂÆÇÆ\\x06\\x03·¼ÆÇżµÈǼÂÁ\\x03¸ï¶¼¸Á¶¼¸Æ\\x03´Á·\\x03ÂÈÅ\\x03´µ¼¿¼Ç Ì\\x03ÇÂ\\x03À¸¸Ç\\x03\\ncustomers on their terms.',\n", " 'The strength of our wireless network \\x03ÿ´Ì¸·\\x03´\\x03¿´Åº¸\\x03Å¿¸\\x03¼Á\\x03ÂÈÅ\\x03Æȶ¶¸ÆÆ\\x06\\x03ʼǻ \\nÂÈÅ\\x03Ÿ¶¸ÁÇ\\x03Æø¶ÇÅÈÀ\\x03¼ÁɸÆÇÀ¸ÁÇÆ\\x03øŹÂÅÀ¼Áº\\x03¸É¸Á\\x03µ¸ÇǸÅ\\x03Ç»´Á\\x03¸Ëà ¸¶Ç¸·\\x04\\x03¢Á \\n¹´¶Ç\\x06\\x03ʸ\\x03ʸŸ\\x03¸ï¶¼¸ÁÇ\\x03¸ÁÂȺ»\\x03 ʼǻ\\x03ÂÈÅ\\x03·¸Ã¿ÂÌÀ¸ÁÇ\\x03¹\\x03À¼·\\x88µ´Á·\\x03!',\n", " '\\x03Æø¶ÇÅÈÀ \\nthat we reached more than 150 million people, more than double our \\noriginal year -end cover age target \\x04\\x03\\x9aÁ·\\x03ʸ\\x03¸Ëø¶Ç\\x03ÇÂ\\x03»¼Ç\\x03\\x1e\\x1c\\x1c\\x03À¼¿¿¼ÂÁ\\x03øÂÿ¸\\x03µÌ \\nÇ»¸\\x03¸Á·\\x03¹\\x03\\x1e\\x1c\\x1e\\x1f\\x04\\x03\\x9aÆ\\x03´\\x03ŸÆÈ¿Ç\\x06\\x03ÂÈÅ\\x03´¿Å¸´·Ì\\x03¶ÂÁƼÆǸÁÇ\\x03·ÂÊÁ¿Â´·\\x03Æ Ã¸¸·Æ\\x03¼Á¶Å¸´Æ¸·',\n", " 'À´Ç¸Å¼´¿¿Ì\\x06\\x03´Æ\\x03Ÿ¶¸ÁÇ¿Ì\\x03Ÿ¶ÂºÁ¼Í¸·\\x03¼Á\\x03Ç»¸\\x03«ÂÂÇ\\x03¦¸Çż¶Æ\\x03Ƹ¶ÂÁ·\\x88» ´¿¹\\x03\\x1e\\x1c\\x1e\\x1e\\x03ŸÆÈ¿ÇÆ\\x04 \\n\\xad»¼Æ\\x03¼Á¶Å¸´Æ¸·\\x03Æø¸·\\x03ÃÅÂɼ·¸·\\x03´ÁÂÇ»¸Å\\x03ƼºÁ¼è¶´ÁÇ\\x03µ¸Á¸èÇ\\x03ÇÂ\\x03ÂÈÅ\\x03',\n", " '¶ÈÆÇÂÀ¸ÅÆ\\x04\\n¨ÈÅ\\x03ʼŸ¿¸ÆÆ\\x03Á¸ÇÊž\\x03¼Æ\\x03´¿ÆÂ\\x03Ç»¸\\x03»¸´ÅÇ\\x03¹\\x03\\x9f¼ÅÆǧ¸ÇÒ\\x06\\x03Ãȵ¿¼¶\\x03Æ´¹ ¸ÇÌ\\x0cÆ\\x03·¸·¼¶´Ç¸·\\x06\\x03\\nnationwide communications platform. The AT&T and FirstNet networks ¶ÂɸÅ\\x03ÀŸ\\x03Ç»´Á\\x03%%Y\\x03¹\\x03Ç»¸\\x03ÃÂÃÈ¿´Ç¼ÂÁ\\x03Ç·´Ì\\x06\\n\\x1f\\x03´Á·\\x03\\x9f¼ÅÆǧ¸Ç\\x03¶ÂɸÅÆ\\x03ÀŸ\\x03\\nèÅÆÇ\\x03ŸÆÃÂÁ·¸ÅÆ\\x03Ç»´Á',\n", " '¸ÆÃÂÁ·¸ÅÆ\\x03Ç»´Á\\x03´ÁÌ\\x03ÂÇ»¸Å\\x03Á¸ÇÊž\\x03¼Á\\x03\\x9aÀ¸Å¼¶´\\x044\\x03¢ÇÔÆ\\x03´Á\\x03»ÂÁÂÅ\\x03ÇÂ\\x03ƸÅɸ\\x03\\n´Á·\\x03ÆÈÃÃÂÅÇ\\x03Ç»¸À\\x03ʼǻ\\x03ÃżÂżǼ͸·\\x03¶ÂÁÁ¸¶Ç¼É¼ÇÌ\\x03´Á·\\x03¶´Ã´¶¼ÇÌ\\x03Ã¿È Æ\\x03·¸·¼¶´Ç¸·\\x03\\nÆø¶ÇÅÈÀ\\x04\\x03°¸\\x03¸Á·¸·\\x03Ç»¸\\x03̸´Å\\x03ʼǻ\\x03 about 4.4 million FirstNet connections \\nacross more than 24,000 agencies .',\n", " '4.4 million FirstNet connections \\nacross more than 24,000 agencies . \\nFiber\\n°¸\\x03·¸¿¼É¸Å¸·\\x03ÆÇÅÂÁº\\x03¹È¿¿\\x88̸´Å\\x03ŸÆÈ¿ÇÆ\\x03¼Á\\x03 AT&T Fiber® \\x03´Æ\\x03ʸ¿¿\\x04\\x03\\x9f¼µ¸Å\\x03¼Æ\\x03´\\x03·ÈÅ´µ¿¸\\x06\\x03\\nÆÈÆÇ´¼Á´µ¿¸\\x03Ǹ¶»Á¿ºÌ\\x03Ç»´Ç\\x03¶ÂÁÁ¸¶ÇÆ\\x03øÂÿ¸\\x03´Á·\\x03µÈƼÁ¸ÆƸÆ\\x03ʼǻ',\n", " '\\x03¸´¶»\\x03ÂÇ»¸Å\\x03\\n´Á·\\x03ÇÂ\\x03Ç»¸\\x03ÊÂÅ¿·\\x04\\x03\\x9f¼µ¸Å\\x03¼ÁɸÆÇÀ¸ÁÇÆ\\x03»´É¸\\x03´\\x03ÀȿǼ\\x88·¸¶´·¸\\x03¿¼¹¸Æô Á\\x06\\x03´Á·\\x03ʸÔŸ\\x03\\n¼ÁɸÆǼÁº\\x03»¸´É¼¿Ì\\x03ÇÂ\\x03µÈ¼¿·\\x03ÂÈÇ\\x03ÂÈÅ\\x03Á¸ÇÊž\\x04\\x03°¸\\x03µ¸¿¼¸É¸\\x03Ç»´Ç\\x03\\x9a\\xad\\x86 \\xad\\x03Âæ¸ÅÆ\\x03Ç»¸\\x03\\nµ¸ÆÇ\\x03ʼŸ·\\x03¼ÁǸÅÁ¸Ç\\x03´É´¼¿´µ¿¸\\x04\\x03',\n", " 'ªÈ¼Ç¸\\x03ƼÀÿÌ\\x06\\x03Ê»¸Å¸\\x03ʸ\\x03µÈ¼¿·\\x03赸Å\\x06\\x03ʸ\\x03ʼÁ\\x04\\n\\x1e\\x1c\\x1e\\x1e\\x03À´Å¾¸·\\x03ÂÈÅ\\x03 èì»\\x03ÆÇÅ´¼º»Ç\\x03̸´Å\\x03ʼǻ\\x03\\x1d\\x03À¼¿¿¼ÂÁ\\x03ÂÅ\\x03ÀŸ\\x03Á¸Ç\\x03´··¼Ç¼ÂÁÆ \\x06\\x03\\nÅ´¼Æ¼Áº\\x03ÂÈÅ\\x03\\x9a\\xad\\x86\\xad\\x03\\x9f¼µ¸Å\\x03Æȵƶżµ¸Å\\x03µ´Æ¸\\x03ÇÂ\\x03ÀŸ\\x03Ç»´Á\\x03#\\x03À¼¿¿¼ÂÁ\\x04\\x03 We led the',\n", " 'We led the \\n¼Á·ÈÆÇÅÌ\\x03¼Á\\x03µÅ¼Áº¼Áº\\x03赸Å\\x03ÇÂ\\x03»ÂÀ¸Æ!\\x03´Á·\\x03¶¿ÂƸ·\\x03Ç»¸\\x03̸´Å\\x03ʼǻ\\x03Ç»¸\\x03´µ¼¿¼ÇÌ\\x03 \\nÇÂ\\x03ƸÅɸ\\x03 more than 19 million consumer locations \\x04\\x03°¸\\x03´¿ÆÂ\\x03»´É¸\\x03Ç»¸\\x03 \\n´µ¼¿¼ÇÌ\\x03ÇÂ\\x03ƸÅɸ\\x03 more than 3 million business locations . We are on track \\nÇÂ\\x03Ÿ´¶»\\x03ÂÈÅ\\x03ßɼÂÈÆ¿Ì\\x03´ÁÁÂÈÁ¶¸·\\x03ºÂ´¿\\x03¹\\x03 30 million-plus total locations',\n", " '30 million-plus total locations \\x06\\x03\\n¼Á¶¿È·¼Áº\\x03¶ÂÁÆÈÀ¸Å\\x03´Á·\\x03µÈƼÁ¸ÆÆ\\x06\\x03µÌ\\x03Ç»¸\\x03¸Á·\\x03¹\\x03\\x1e\\x1c\\x1e!\\x04\\x03\\n¨ÈÅ\\x03Ÿ¶¸ÁÇ¿Ì\\x03´ÁÁÂÈÁ¶¸·\\x03´ºÅ¸¸À¸ÁÇ\\x03ÇÂ\\x03¹ÂÅÀ\\x03´\\x03 joint venture with BlackRock \\nAlternatives — Gigapower',\n", " 'joint venture with BlackRock \\nAlternatives — Gigapower \\x03\\x8a\\x03¼Æ\\x03´Á\\x03¼ÁÁÂɴǼɸ\\x03Á¸Ê\\x03µÈƼÁ¸ÆÆ\\x03À·¸¿\\x03ʸ\\x03´Å¸\\x03\\nǸÆǼÁº\\x03ÇÂ\\x03·Å´À´Ç¼¶´¿¿Ì\\x03¼Á¶Å¸´Æ¸\\x03Ç»¸\\x03ô¶¸\\x03¹\\x03赸Å\\x03¼ÁÆÇ´¿¿´Ç¼ÂÁ\\x03 ÂÈÇƼ·¸\\x03¹\\x03ÂÈÅ\\x03\\nÇÅ´·¼Ç¼ÂÁ´¿\\x03ʼŸ¿¼Á¸\\x03À´Å¾¸ÇÆ\\x04\\x03°¸\\x03µ¸¿¼¸É¸\\x03´º¼¿¸\\x03ɸÁÇÈŸÆ\\x03¿¼¾¸\\x03Ç»',\n", " '¼Æ\\x03ÂøÁ\\x03ÈÃ\\x03Á¸Ê\\x03\\nÃÂÆƼµ¼¿¼Ç¼¸Æ\\x03ÇÂ\\x03¶ÂÁÁ¸¶Ç\\x03ÈÁ·¸ÅƸÅÉ ¸·\\x03À´Å¾¸ÇÆ\\x03ʼǻ\\x03赸Å\\x03´Á·\\x03¶´Á\\x03 ¶ÂÀøǸ\\x03ÀŸ \\n¸æ¸¶Ç¼É¸¿Ì\\x03¹ÂÅ\\x03Ç»¸\\x03¶»´Á¶¸\\x03ÇÂ\\x03¶Â\\x88¼ÁɸÆÇ\\x03ʼǻ\\x03Ç»¸\\x03®\\x04¬\\x04\\x03ºÂɸÅÁÀ¸ÁÇ',\n", " '\\x03ÂÁ\\x03ÂÈÅ\\x03Æ»´Å¸·\\x03\\nµ½¸¶Ç¼É¸Æ\\x03¹\\x03´\\x03µ¸ÇǸÅ\\x06\\x03¶ÂÁÁ¸¶Ç¸·\\x03\\x9aÀ¸Å¼¶´\\x04\\x03\\x9a\\xad\\x86\\xad\\x03»´Æ\\x03Ç»¸\\x03´µ¼¿¼ÇÌ\\x03\\nÇÂ\\x03ƸÅɸ\\x03ÀŸ\\x03Ç»´Á\\x03\\n\\x1e\\x1e\\x03À¼¿¿¼ÂÁ\\x03¶ÂÁÆÈÀ¸Å\\x03\\n´Á·\\x03µÈƼÁ¸ÆÆ\\x03\\n¿Â¶´Ç¼ÂÁÆ\\x03ʼǻ\\x03赸Å\\x04\\nF1157donD2R1.indd 2 F1157donD2R1.indd 2 3/7/23 9:06 PM 3/7/23 9:06 PM',\n", " '33\\nThese results illustrate ÂÈÅ\\x03´ÃÃÅ´¶»\\x03»´Æ\\x03·¸¿¼É¸Å¸· , and while we’ll remain \\n´º¼¿¸\\x03´Æ\\x03Ç»¸\\x03¼Á·ÈÆÇÅÌ\\x03´Á·\\x03¸¶ÂÁÂÀÌ\\x03Æ»¼ì\\x06\\x03ʸÔŸ\\x03¶ÂÁè·¸ÁÇ\\x03¼Á\\x03ÂÈÅ\\x03´ µ¼¿¼ÇÌ\\x03ÇÂ\\x03\\ncontinue executing at a high level.',\n", " '\\x9cÂÅÃÂŴǸ\\x03ŸÆÃÂÁƼµ¼¿¼ÇÌ\\nThis ·Å¼É¸\\x03ÇÂ\\x03¶ÂÁÁ¸¶Ç\\x03øÂÿ¸\\x03ÇÂ\\x03ºÅ¸´Ç¸Å\\x03ÃÂÆƼµ¼¿¼ÇÌ includes doing our part \\nto create a more connected society and provide underserved communities with the resources they need for education, employment, health care and economic opportunity. \\nDespite the growing availability of high-quality connectivity, \\x03ÂÁ¸\\x88èì»\\x03¹ \\nÇ»¸\\x03®\\x04¬\\x04\\x03ÃÂÃÈ¿´Ç¼ÂÁ\\x03¼Æ\\x03ÆǼ¿¿\\x03¼Àô¶Ç¸·\\x03µÌ\\x03Ç»¸\\x03·¼º¼Ç´¿\\x03·¼É¼·¸ .\\n6 We’re passionate \\nabout addressing this issue because our country has a once-in-a-generation opportunity to close the broadband gap.',\n", " 'Achieving this will give more Americans better opportunities to further their education and access online training to develop workforce skills, all of which helps foster greater economic equity. That’s why we made a \\x1f\\x88̸´Å\\x06\\x03]\\x1e\\x03µ¼¿¿¼ÂÁ\\x03¶ÂÀÀ¼ÇÀ¸ÁÇ in 2021 to help \\nbridge the digital divide. With this commitment and AT&T’s technology ÿ´Ç¹ÂÅÀÆ\\x03¹ÂÅ\\x03!\\xa0\\x03´Á·\\x03赸Å\\x03·¸Ã¿ÂÌÀ¸ÁÇ\\x03Ç»´Ç\\x03´Å¸\\x03 ´æÂÅ·´µ¿¸\\x06\\x03ÆÈÆÇ´¼Á´µ¿¸\\x03´Á·',\n", " '·ÈÅ´µ¿¸\\x06\\x03ʸ\\x03»´É¸\\x03Ç»¸\\x03¸ËøÅǼƸ\\x03´Á·\\x03ƶ´¿¸\\x03ÇÂ\\x03À´¾¸\\x03´\\x03¿ÂÁº\\x88ǸÅÀ\\x03·¼æ¸Å¸Á¶¸ \\x04\\x03°¸ÔŸ \\nworking to address 3 key components to the digital divide:\\n\\x1d\\x04\\x03 \\x9a¶¶¸ÆÆ\\x04 This primarily impacts areas of the country where deployment \\n\\x03 ¶´Á\\x03µ¸\\x03·¼ï¶È¿Ç\\x03ÂÅ\\x03Æ¿ÂÊ\\x06\\x03µÈÇ\\x03¼ÇÔÆ\\x03ÆÇ´ÅǼÁº\\x03ÇÂ\\x03ü¶¾\\x03ÈÃ\\x03Ç»´Á¾Æ\\x03Ç \\x03Ç»¸\\x03ÀŸ\\x03Ç»´Á\\x03 \\n\\x03 ]',\n", " '\\x03 ] $\\x03µ¼¿¿¼ÂÁ\\x03´¿¿Â¶´Ç¸·\\x03µÌ\\x03\\x9cÂÁºÅ¸ÆÆ\\x03´Á·\\x03Ç»¸\\x03\\x9b¼·¸Á\\x03´·À¼Á¼ÆÇŴǼÂÁ \\x03ÇÂ\\x03¸ËôÁ·\\x03 \\n broadband infrastructure.',\n", " '\\x03ÇÂ\\x03¸ËôÁ·\\x03 \\n broadband infrastructure. Decisions on where to invest in that infrastructure \\n have largely been vested in states, tribal governments and municipalities, and ʸÔŸ\\x03Êž¼Áº\\x03·¼¿¼º¸ÁÇ¿Ì\\x03ÇÂ\\x03èÁ·\\x03Ç»¸\\x03żº»Ç\\x03ÂÃÃÂÅÇÈÁ¼Ç¼¸Æ\\x03¹ÂÅ\\x03Ãȵ ¿¼¶\\x88\\x03\\n\\x03 ÃżɴǸ\\x03ôÅÇÁ¸ÅÆ»¼ÃÆ\\x03Ç»´Ç\\x03¸Á´µ¿¸\\x03\\x9a\\xad\\x86\\xad\\x03ÇÂ\\x03»¸¿Ã\\x03¹ÈÁ·\\x06\\x03µÈ¼¿·\\x03´Á·\\x03 À´¼ÁÇ´¼Á\\x03 \\n\\x03 Ç»¸Æ¸\\x03Á¸ÇÊÂÅ¾Æ .',\n", " '\\x04\\x03 \\x9aæÂÅ·´µ¼¿¼ÇÌ\\x04 \\x03\\x9a\\xad\\x86\\xad\\x03¼Æ\\x03´\\x03É¿ÈÁÇ´ÅÌ\\x03ôÅǼ¶¼Ã´ÁÇ\\x03¼Á\\x03Ç»¸\\x03\\x9f\\x9c\\x9cÔÆ\\x03\\x9aæÂÅ·´µ¿¸\\x03\\x03\\n Connectivity Program that subsidizes the cost of wireless or internet service for eligible households. When paired with our low-cost Access from AT&T \\x03 Âæ¸Å¼Áº\\x06\\x03 ÄÈ´¿¼è¸·\\x03¶ÈÆÇÂÀ¸ÅÆ\\x03¶´Á\\x03Ÿ¶¸¼É¸\\x03¼ÁǸÅÁ¸Ç\\x03Æø¸·Æ\\x03ÈÃ\\x03ÇÂ\\x03\\x1d\\x1c\\x1c\\x03¦µÃÆ\\x03\\x03\\n\\x03 ¹ÂÅ\\x03¹Å¸¸ .',\n", " '\\x04\\x03 \\x9a·ÂÃǼÂÁ\\x04\\x03 We’re providing communities, students and parents with ¹Å¸¸\\x03 \\n\\x03 ·¼º¼Ç´¿\\x03¿¼Ç¸Å´¶Ì\\x06\\x03ÂÁ¿¼Á¸\\x03Æ´¹¸ÇÌ\\x03´Á·\\x03·¼º¼Ç´¿\\x03¿¸´ÅÁ¼Áº\\x03Ç¿Æ\\x03 so they understand \\n and feel comfortable with connectivity and can get the most out of their \\n internet connections. These include our Connected Learning Centers housed within local community organizations. The cent ers provide students and \\n families with computers, high-speed internet access and digital learning and literacy resources. We have 20 of these centers today and plan to reach \\n\\x03 !\\x1c\\x03ÇÂÇ´¿\\x03¿Â¶´Ç¼ÂÁÆ\\x03µÌ\\x03\\x1e\\x1c\\x1e \\x04\\x03We have a once- \\nin-a-generation \\nopportunity \\nto close the \\nbroadband gap.',\n", " 'F1157donD2R1.indd 3 F1157donD2R1.indd 3 3/1/23 7:14 PM 3/1/23 7:14 PM',\n", " 'AT&T Inc. 2022 Annual Report 4\\n¬¼Á¶¸Å¸¿Ì\\x06\\n£Â»Á\\x03¬Ç´Á¾¸Ì\\n\\x9c»¼¸¹\\x03\\x9e˸¶ÈǼɸ\\x03¨ï¶¸Å\\x06\\x03\\x9a\\xad\\x86\\xad\\x03¢Á¶\\x04February 13, 2023Finally, AT&T is taking action to address climate change in ways relevant to \\nour business and to prepare for its impacts on our operations, customers and communities. We’ve set meaningful goals for 2035, including to be carbon neutral across our global operations. We’ll also help our business customers save a gigaton of greenhouse gas emissions through AT&T connectivity solutions. We’re currently using cutting-edge climate projections to build a more climate resilient network, and we’re sharing the modeled data publicly to help communities better prepare for extreme weather events.\\n\\xad»´Á¾\\x03ÌÂÈ\\nAT&T’s resilience and strong performance are attributable to the perseverance of the people we have guiding and operating the business and serving our customers every day.',\n", " '\\xadÂ\\x03ÂÈÅ\\x03¼ÁÆüŸ·\\x03¸ÀÿÂ̸¸Æ\\x05 Thank you for working tirelessly to keep our \\ncustomers connected, sometimes in the toughest conditions imaginable. Your deep expertise across the entire business serves and delights everyone from consumers to business customers to our government partners. Together, we’re creating a “big tent” that nurtures and respects a broad spectrum of beliefs, identities and cultures. The strength of our diversity, equity and inclusion practices also informs how we, as a company, approach the big social issues facing us today. We start with you in mind as we support public policies that foster growth in our business and help you, your families, neighbors and friends to achieve your greatest possibilities. \\n\\xadÂ\\x03ÂÈÅ\\x03¶ÈÆÇÂÀ¸ÅÆ\\x05 You’re the reason we’re here. We’re committed to \\ndelivering a more connected future — one full of possibility — that improves your lives for the better. Thank you for the trust you place in us.',\n", " 'Thank you for the trust you place in us. In return, we work tirelessly to serve you and give our best every day. \\n\\x9aÁ·\\x03ÇÂ\\x03ÂÈÅ\\x03Æ»´Å¸»Â¿·¸ÅÆ\\x05 \\x03\\xad»´Á¾\\x03ÌÂÈ\\x03¹ÂÅ\\x03ÌÂÈÅ\\x03¶ÂÁè·¸Á¶¸\\x03¼Á\\x03\\x9a\\xad\\x86\\xad\\x04\\x03°¸\\x03µ¸¿¼¸É¸\\x03\\nwe’ve made steady, consistent progress toward proving our strategy is the right one, and we’re committed to continuing our focus on improving our returns to you.By 2035, AT&T will be \\ncarbon neutral.\\nF1157donD2R1.indd 4 F1157donD2R1.indd 4 3/1/23 7:14 PM 3/1/23 7:14 PM',\n", " '5AT&T Inc. Financial Review 2022\\nManagement’s Discussion and Analysis\\nof Financial Condition and Results of Operations............................................................... 6\\nConsolidated Financial Statements........................................................................................... 34Notes to Consolidated Financial Statements........................................................................ 40Report of Management............................................................................................................. ....... 80\\nReport of Independent Registered Public Accounting Firm .......................................... 81References..................................................................................................................... ......................... 84\\nBoard of Directors ............................................................................................................... ............... 85\\nOfficers of AT&T Inc. ................................................................................................................. ......... 86',\n", " 'OVERVIEW\\nAT&T Inc. is referred to as “we,” “AT&T” or the “Company”\\nthroughout this document. AT&T products and servicesare provided or offered by subsidiaries and affiliates ofAT&T Inc. under the AT&T brand and not by AT&T Inc., andthe names of the particular subsidiaries and affiliatesproviding the services generally have been omitted. AT&Tis a holding company whose subsidiaries and affiliatesoperate worldwide in the telecommunications andtechnology industries. You should read this discussion inconjunction with the consolidated financial statementsand accompanying notes (Notes). Unless otherwise noted,this discussion refers only to our continuing operationsand does not include discussion of balances or activity ofWarnerMedia, Vrio, Xandr and Playdemic Ltd. (Playdemic),which are part of discontinued operations.',\n", " '(Playdemic),which are part of discontinued operations.\\nOur Management’s Discussion and Analysis of Financial\\nCondition and Results of Operations included in thisdocument generally discusses 2022 and 2021 items andyear-to-year comparisons between 2022 and 2021.Discussions of 2020 items and year-to-year comparisonsbetween 2021 and 2020 that are not included in thisdocument can be found in “Management’s Discussion andAnalysis of Financial Condition and Results of Operations”in Part II, Item 7 of our Annual Report on Form 10-K for thefiscal year ended December 31, 2021.\\nOn April 8, 2022, we closed our transaction to combine\\nsubstantially all of our WarnerMedia segment(WarnerMedia) with a subsidiary of Discovery, Inc(Discovery). Upon the separation and distribution ofWarnerMedia, the WarnerMedia business met the criteria\\nfor discontinued operations. For discontinued operations,we also evaluated transactions that were components ofAT&T’s single plan of a strategic shift, includingdispositions that did not individually meet the criteria dueto materiality, and have determined discontinuedoperations to be comprised of WarnerMedia, Vrio, Xandrand Playdemic.',\n", " 'These businesses are reflected in theaccompanying financial statements as discontinuedoperations, including for periods prior to theconsummation of the WarnerMedia/Discoverytransaction .(See Notes 6 and 23)\\nOn July 31, 2021, we closed our transaction with TPG\\nCapital (TPG) to form a new company named DIRECTV\\nEntertainment Holdings, LLC (DIRECTV). With the close of\\nthe transaction, we separated our Video business,\\ncomprised of our U.S. video operations, and began\\naccounting for our investment in DIRECTV under the\\nequity method. (See Note 6)\\nWe have two reportable segments: Communications and\\nLatin America. Our segment results presented in Note 4and discussed below follow our internal managementreporting. Each segment’s percentage calculation of totalsegment operating revenue is derived from our segmentresults table in Note 4. Segment operating income isattributable to our Communications segment due tooperating losses in Latin America. Percentage increasesand decreases that are not considered meaningful aredenoted with a dash.\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs.',\n", " '2021 2021 vs. 2020\\nOperating Revenues\\nCommunications $ 117,067 $ 114,730 $ 109,965 2.0 % 4.3 %\\nLatin America 3,144 2,747 2,562 14.5 7.2\\nCorporate and Other:\\nCorporate 530 731 766 (27.5) (4.6)\\nVideo — 15,513 28,610 — (45.8)\\nHeld-for-sale and other reclassifications — 453 1,414 — (68.0)\\nEliminations and consolidation — (136) (267) — 49.1\\nAT&T Operating Revenues $ 120,741 $ 134,038 $ 143,050 (9.9)% (6.3)%\\nOperating Income\\nCommunications $ 29,107 $ 28,393 $ 29,062 2.5 % (2.3)%\\nLatin America (326) (510) (587) 36.1 13.1\\nSegment Operating Income 28,781 27,883 28,475 3.2 (2.1)\\nCorporate (2,570) (1,',\n", " '475 3.2 (2.1)\\nCorporate (2,570) (1,644) (1,398) (56.3) (17.6)\\nVideo — 2,491 2,174 — 14.6\\nHeld-for-sale and other reclassifications — 143 681 — (79.0)\\nReclassification of prior service credits (2,691) (2,680) (2,442) (0.4) (9.7)\\nCertain significant items (28,107) (296) (19,118) — 98.5\\nAT&T Operating Income (Loss) $ (4,587) $ 25,897 $ 8,372 —% —%Management’s Discussion and Analysis of Financial Condition and Results of Operations\\nDollars in millions except per share amounts\\n;',\n", " 'TheCommunications segment accounted for\\napproximately 97% of our 2022 total segment operatingrevenues compared to 98% in 2021 and accounted for allsegment operating income in 2022 and 2021. This segmentprovides services to businesses and consumers located inthe U.S. and businesses globally. Our business strategiesreflect bundled product offerings that cut across productlines and utilize shared assets. This segment contains thefollowing business units:\\n•Mobility provides nationwide wireless service and\\nequipment.\\n•Business Wireline provides advanced ethernet-based\\nfiber services, IP Voice and managed professionalservices, as well as traditional voice and data servicesand related equipment to business customers.\\n•Consumer Wireline provides broadband services,\\nincluding fiber connections that provide our multi-gigservices to residential customers in select locations.Consumer Wireline also provides legacy telephonyvoice communication services.TheLatin America segment accounted for approximately\\n3% of our 2022 total segment operating revenuescompared to 2% in 2021. This segment provides wirelessservices and equipment in Mexico.\\nRESULTS OF OPERATIONS\\nConsolidated Results Our financial results from\\ncontinuing operations are summarized in the followingtable. We then discuss factors affecting our overall resultsfrom continuing operations.',\n", " 'We then discuss factors affecting our overall resultsfrom continuing operations. Additional analysis isdiscussed in our “Segment Results” section. We alsodiscuss our expected revenue and expense trends for2023 in the “Operating Environment and Trends of theBusiness” section. Certain prior-period amounts havebeen reclassified to conform to the current period’spresentation.\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nOperating revenues\\nService $ 97,831 $ 111,565 $ 124,057 (12.3)% (10.1)%\\nEquipment 22,910 22,473 18,993 1.9 18.3\\nTotal Operating Revenues 120,741 134,038 143,050 (9.9) (6.3)\\nOperating expenses\\nOperations and support 79,809 90,076 96,468 (11.4) (6.6)\\nAsset impairments and abandonments\\nand restructuring 27,498 213 15,687 — (98.6)\\nDepreciation and amortization 18,021 17,852 22,523 0.9 (20.',\n", " '021 17,852 22,523 0.9 (20.7)\\nTotal Operating Expenses 125,328 108,141 134,678 15.9 (19.7)\\nOperating Income (Loss) (4,587) 25,897 8,372 — —\\nInterest expense 6,108 6,716 7,727 (9.1) (13.1)\\nEquity in net income of affiliates 1,791 603 89 — —\\nOther income (expense) – net 5,810 9,387 (1,088) (38.1) —\\nIncome (Loss) from Continuing Operations\\nBefore Income Taxes (3,094) 29,171 (354) — —\\nIncome (Loss) from Continuing Operations $ (6,874) $ 23,776 $ (1,522) —% —%\\n?',\n", " 'OVERVIEW\\nOperating revenues decreased in 2022 and 2021. The\\n2022 decline reflects the July 31, 2021 separation of the U.S.video business, other business divestitures that were notincluded in discontinued operations and lower BusinessWireline revenues driven by lower demand for legacyservices and product simplification. Partially offsettingdeclines were higher Mobility service and equipmentrevenues and, to a lesser extent, gains in broadbandservice in our Communications segment and growth inMexico wireless operations.\\nThe 2021 decline reflects the 2021 separation of the U.S.\\nvideo business and the October 2020 sale of wireless andwireline operations in Puerto Rico and the U.S. VirginIslands. Also contributing to revenue declines was lowerBusiness Wireline revenues due in part to higher demandfor pandemic-related connectivity in the prior year.Partially offsetting declines were higher Mobilityequipment and service revenues and gains in broadbandservice, and growth in Mexico wireless operationsincluding favorable foreign exchange impacts.\\nOperations and support expenses decreased in 2022 and\\n2021. The 2022 decline reflects the separation of U.S.',\n", " 'The 2022 decline reflects the separation of U.S. videoand lower personnel costs associated with ongoingtransformation initiatives, partially offset by higher baddebt expense, the elimination of Connect America FundPhase II (CAF II) government credits and increasedwholesale network access charges. Wireless equipmentcosts were up slightly, with higher sales volumes and thesale of higher-priced smartphones largely offset by lower3G shutdown costs in 2022. In the first quarter of 2022, weupdated the expected economic lives of customerrelationships, which extended the amortization period ofdeferred acquisition and fulfillment costs and reducedexpenses approximately $395, with $150 recorded toMobility, $115 to Business Wireline and $130 to ConsumerWireline.\\nThe 2021 decline reflects our 2021 business divestitures,\\nlower bad debt expense and lower personnel costsassociated with our transformation initiatives. Declineswere mostly offset by increased domestic wirelessequipment expense from higher volumes.\\nAsset impairments and abandonments and\\nrestructuring increased in 2022 and decreased in 2021.',\n", " 'The increase in 2022 was primarily due to $24,812 ofnoncash goodwill impairments associated with ourBusiness Wireline, Consumer Wireline and Mexicoreporting units and were driven by higher interest ratesconsistent with the macroeconomic environment, withsecular declines also impacting Business Wireline growthrates (see Note 9). The increase in 2022 also included$1,413 of wireline conduit asset abandonments (see Note7) and $1,273 of restructuring and other impairmentcharges due to updated network build plans stemmingfrom spectrum acquired in recent auctions, severancecharges associated with transformation initiatives andimpairment of personal protective equipment inventory.Impairment charges in 2021 were lower than 2020,\\nreflecting a fourth-quarter 2020 impairment charge of$15,508 resulting from our assessment of therecoverability of the long-lived assets and goodwillassociated with our U.S. video business.\\nDepreciation and amortization expense increased in\\n2022 and decreased in 2021.\\nDepreciation expense increased $218, or 1.2%, in 2022.',\n", " 'Depreciation expense increased $218, or 1.2%, in 2022.\\nThe increase was primarily due to ongoing capitalinvestment for strategic initiatives such as fiber andnetwork upgrades and expansion, partially offset byhigher estimated lives of our fiber assets (see Note 7).Depreciation expense decreased $1,394, or 7.3%, in 2021,primarily due to ceasing depreciation on U.S. video held-for-sale assets.\\nAmortization expense decreased $49, or 22.5%, in 2022\\nand $3,277, or 93.8%, in 2021. Lower amortizationreflects our accelerated method of amortization ofintangible assets from previous acquisitions and ceasingamortization on U.S. video held-for-sale assets in 2021.\\nOperating income decreased in 2022 and increased in\\n2021. Our operating margin was (3.8)% in 2022, comparedto 19.3% in 2021 and 5.9% in 2020.\\nInterest expense decreased in 2022 primarily due to\\nlower debt balances and higher capitalized interestassociated with spectrum acquisitions, partially offset byhigher interest rates.',\n", " 'Interest expense decreased in 2021primarily due to lower interest rates and higher capitalizedinterest associated with spectrum acquisitions, partiallyoffset by higher debt balances.\\nEquity in net income of affiliates increased in 2022 and\\n2021, primarily due to the close of our transaction withTPG related to the U.S. video business, which resulted inour accounting for our investment in DIRECTV under theequity method of accounting beginning August 1, 2021(see Notes 6, 10 and 19).\\nOther income (expense) – net decreased in 2022\\nprimarily due to lower actuarial gains ($1,999 in 2022compared to $4,140 in 2021), lower pension andpostretirement benefit credits and lower returns on otherbenefit-related investments. Pension and postretirementbenefit credits decreased as a result of higher assumeddiscount rates and lower returns on benefit plan assets.Our 2022 benefit expense also includes approximately$280 favorable impact from a retirement benefit planchange, with $230 resulting from prior service credits(approximately $100 for Business Wireline, $80 forConsumer Wireline and $40 for Mobility) (see Note 14).',\n", " 'The increase in 2021 was primarily due to the recognition\\nof $4,140 in actuarial gains, compared to losses of $4,169in 2020, and the recognition of $1,405 of debt redemptioncosts in 2020. Also contributing to increased income in2021 were higher net pension and postretirement benefitcredits from higher prior service credit amortization (seeNote 14).Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n!',\n", " 'Income tax expense decreased in 2022 and increased in\\n2021. The 2022 decrease was primarily driven by lowerincome before income tax offset by impairments ofgoodwill (see Note 9), which are not deductible for taxpurposes.\\nThe increase in 2021 was primarily due to increased\\nincome before income taxes, offset primarily by theCoronavirus Aid, Relief, and Economic Security Act (CARESAct) benefit of U.S. federal Net Operating Loss (NOL)carryback and benefits of divestitures in 2021.\\nOur effective tax rate was (122.2)% in 2022, 18.5% in 2021,\\nand (329.9)% in 2020. The effective tax rate was impactedby our goodwill impairments associated with our BusinessWireline, Consumer Wireline and Mexico reporting units in2022, and Video goodwill impairment in 2020, which arenot deductible for tax purposes.\\nSegment Results Our segments are strategic business\\nunits that offer different products and services overvarious technology platforms and/or in differentgeographies that are managed accordingly.',\n", " 'We alsoevaluate segment performance based on EBITDA and/orEBITDA margin, which is defined as operating incomeexcluding depreciation and amortization. EBITDA is used\\nas part of our management reporting and we believeEBITDA to be a relevant and useful measurement to ourinvestors as it measures the cash generation potential ofour business units. EBITDA does not give effect todepreciation and amortization expenses incurred inoperating income nor is it burdened bycash used for debt\\nservice requirements and thus does not reflect availablefunds for distributions, reinvestment or otherdiscretionary uses. EBITDA margin is EBITDA divided bytotal revenues.\\nIn the first quarter of 2022, we reclassified into “Corporate”\\ncertain administrative costs borne by AT&T where thebusiness units do not influence decision making toconform with the current period presentation. This recastincreased Corporate operations and support expenses byapproximately $270 and $1,310 for full-year 2021 and 2020,respectively. Correspondingly, this recast loweredadministrative expenses for the Communicationssegment, with no change on a consolidated basis.',\n", " 'COMMUNICATIONS SEGMENT\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nSegment Operating Revenues\\nMobility $ 81,780 $ 78,254 $ 72,564 4.5 % 7.8 %\\nBusiness Wireline 22,538 23,937 25,083 (5.8) (4.6)\\nConsumer Wireline 12,749 12,539 12,318 1.7 1.8\\nTotal Segment Operating Revenues $ 117,067 $ 114,730 $ 109,965 2.0 % 4.3 %\\nSegment Operating Income\\nMobility $ 24,528 $ 23,370 $ 22,801 5.0 % 2.5 %\\nBusiness Wireline 3,252 4,027 4,799 (19.2) (16.1)\\nConsumer Wireline 1,327 996 1,462 33.2 (31.9)\\nTotal Segment Operating Income $ 29,107 $ 28,393 $ 29,062 2.5 % (2.',\n", " '107 $ 28,393 $ 29,062 2.5 % (2.3)%\\nSelected Subscribers and Connections\\nDecember 31,\\n(000s) 2022 2021 2020\\nMobility subscribers 217,397 201,791 182,558\\nTotal domestic broadband connections 15,386 15,504 15,384\\nNetwork access lines in service 5,213 6,177 7,263\\nU-verse VoIP connections 2,930 3,333 3,816\\nOperating revenues increased in 2022, driven by\\nincreases in our Mobility and Consumer Wireline businessunits, partially offset by a decrease in our BusinessWireline business unit. The increases are primarily drivenby wireless service and equipment revenue growth andgains in broadband service. Business Wireline continues toreflect lower demand for legacy services and productsimplification.Operating income increased in 2022 and decreased in\\n2021. The 2022 operating income reflects an increase inoperating income from our Mobility and ConsumerWireline business units, partially offset by declines in ourBusiness Wireline business unit.',\n", " 'Our Communicationssegment operating income margin was 24.9% in 2022,24.7% in 2021 and 26.4% in 2020.\\n¿',\n", " 'Communications Business Unit Discussion\\nMobility Results\\nPercent Change\\n2022 2021 20202022 vs. 2021 2021 vs. 2020\\nOperating revenues\\nService $ 60,499 $ 57,590 $ 55,542 5.1 % 3.7 %\\nEquipment 21,281 20,664 17,022 3.0 21.4\\nTotal Operating Revenues 81,780 78,254 72,564 4.5 7.8\\nOperating expenses\\nOperations and support 49,054 46,762 41,677 4.9 12.2\\nDepreciation and amortization 8,198 8,122 8,086 0.9 0.4\\nTotal Operating Expenses 57,252 54,884 49,763 4.3 10.3\\nOperating Income $ 24,528 $ 23,370 $ 22,801 5.0 % 2.5 %\\nThe following tables highlight other key measures of performance for Mobility:\\nSubscribers\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs.',\n", " '2021 2021 vs. 2020\\nPostpaid 84,700 81,534 77,154 3.9 % 5.7 %\\nPostpaid phone 69,596 67,260 64,216 3.5 4.7\\nPrepaid 19,176 19,028 18,102 0.8 5.1\\nReseller 6,043 6,113 6,535 (1.1) (6.5)\\nConnected devices1107,478 95,116 80,767 13.0 17.8\\nTotal Mobility Subscribers2217,397 201,791 182,558 7.7 % 10.5 %\\n1Includes data-centric devices such as session-based tablets, monitoring devices and primarily wholesale automobile systems.\\n2Wireless subscribers at December 31, 2022 excludes the impact of 10,176 subscriber and connected device disconnections resulting from our 3G networ k shutdown in\\nFebruary 2022. Postpaid disconnections were 897, including 437 phone, 234 prepaid, 749 reseller subscribers, and 8,296 connected devices.',\n", " 'Mobility Net Additions\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs. 2021 2021 vs.',\n", " '2021 2021 vs. 2020\\nPostpaid Phone Net Additions 2,868 3,196 1,457 (10.3) % —%\\nTotal Phone Net Additions 3,272 3,850 1,640 (15.0) —\\nPostpaid24,091 4,482 2,183 (8.7) —\\nPrepaid 479 956 379 (49.9) —\\nReseller 462 (534) (449) — (18.9)\\nConnected devices320,594 14,328 14,785 43.7 (3.1)\\nMobility Net Subscriber Additions125,626 19,232 16,898 33.2 % 13.8 %\\nPostpaid Churn40.97 % 0.94 % 0.98 % 3B P (4) BP\\nPostpaid Phone-Only Churn40.81 % 0.76 % 0.79 % 5B P (3) BP\\n1Excludes migrations and acquisition-related additions during the period.\\n2In addition to postpaid phones, includes tablets and wearables and other.',\n", " '2In addition to postpaid phones, includes tablets and wearables and other. Tablet net adds (losses) were 203, 28 and (512) for the years ended December 3 1, 2022, 2021 and\\n2020, respectively. Wearables and other net adds were 1,020, 1,258 and 1,238 for the years ended December 31, 2022, 2021 and 2020, respectively.\\n3Includes data-centric devices such as session-based tablets, monitoring devices and primarily wholesale automobile systems. Excludes postpaid t ablets and other\\npostpaid data devices. Wholesale connected car net adds were approximately 9,980, 7,875 and 9,890 for the years ended December 31, 2022, 2021 and 2020 , respectively.\\n4Calculated by dividing the aggregate number of wireless subscribers who canceled service during a month by the total number of wireless subscribers a t the beginning\\nof that month.',\n", " 'The churn rate for the period is equal to the average of the churn rate for each month of that period, excluding the impact of disconnection s resulting\\nfrom our 3G network shutdown in February 2022.Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)Dollars in millions except per share amounts\\n\\t\\x08',\n", " 'Service revenue increased during 2022, largely due to\\ngrowth from subscriber gains and postpaid averagerevenue per subscriber (ARPU) growth.\\nARPU\\nARPU increased in 2022 and reflects pricing actions,improved international roaming and customers shiftingto higher priced unlimited plans, partially offset by theimpact of higher promotional discount amortization(see Note 5).\\nChurn\\nThe effective management of subscriber churn is criticalto our ability to maximize revenue growth and tomaintain and improve margins. Postpaid churn andpostpaid phone-only churn were higher in 2022 due to areturn to pre-pandemic customer behavior, as well aspricing actions and the resulting increase in bothvoluntary and involuntary disconnects.\\nEquipment revenue increased in 2022, primarily driven by\\na higher volume of devices sold and a mix of higher-pricedpostpaid smartphones.\\nOperations and support expenses increased in 2022\\n,\\nlargely driven by growth in equipment sales and\\nassociated expenses, bad debt expense, higher network\\ncosts, the elimination of CAF II government credits, and\\nhigher HBO Max licensing fees and FirstNet costs.',\n", " 'In the\\nfirst quarter of 2022, we updated our analysis of economic\\nlives of customer relationships and extended the\\namortization period of Mobility deferred customer\\ncontract costs, which decreased expense approximately\\n$150.Depreciation expense increased in 2022, primarily due to\\nongoing capital spending for network upgrades andexpansion, partially offset by ceasing use of 3G networkassets.\\nOperating income increased in 2022 and 2021. Our\\nMobility operating income margin was 30.0% in 2022,29.9% in 2021 and 31.4% in 2020. Our Mobility EBITDAmargin was 40.0% in 2022, 40.2% in 2021 and 42.6% in2020.\\nSubscriber Relationships\\nAs the wireless industry has matured, with nearly full\\npenetration of smartphones in the U.S.',\n", " 'population, futurewireless growth will depend on our ability to offerinnovative services, plans and devices that bundle productofferings and take advantage of our 5G wireless network.We believe 5G opens up vast possibilities of connectingsensors, devices, and autonomous things, commonlyreferred to as the Internet of Things (IoT). More and more,these devices are performing use cases that require highbandwidth, ultra-reliability and low latency that only 5Gand edge computing can bring. To support higher mobiledata usage, our priority is to best utilize a wir\\neless\\nnetwork that has sufficient spectrum and capacity to\\nsupport these innovations on as broad a geographic basis\\nas possible.\\nBusiness Wireline Results\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs.',\n", " '2021 2021 vs. 2020\\nOperating revenues\\nService $ 21,891 $ 23,224 $ 24,313 (5.7)% (4.5)%\\nEquipment 647 713 770 (9.3) (7.4)\\nTotal Operating Revenues 22,538 23,937 25,083 (5.8) (4.6)\\nOperating expenses\\nOperations and support 13,972 14,718 15,068 (5.1) (2.3)\\nDepreciation and amortization 5,314 5,192 5,216 2.3 (0.5)\\nTotal Operating Expenses 19,286 19,910 20,284 (3.1) (1.8)\\nOperating Income $ 3,252 $ 4,027 $ 4,799 (19.2)% (16.1)%\\nService revenues decreased in 2022, driven by lower\\ndemand for legacy voice and data services and productsimplification. Also contributing to the decline was lowerrevenues from the government sector. We expect thesetrends to continue.',\n", " 'We expect thesetrends to continue. Partially offsetting revenue declineswas growth in connectivity services and revenues ofapproximately $200 from intellectual property sales in2022.Equipment revenues decreased in 2022, driven by declines\\nin legacy and non-core services which we expect tocontinue.\\nOperations and support expenses decreased in 2022,\\nprimarily due to our continued efforts to drive efficienciesin our network operations through automation,reductions in customer support expenses through',\n", " 'digitization and proactive rationalization of low profit\\nmargin products, and lower personnel costs associatedwith ongoing transformation initiatives. Expense declineswere also driven by credits from a third-quarter 2022retirement benefit plan change and lower amortization ofdeferred fulfillment costs, including our first-quarter 2022updates to the estimated economic lives of subscribers,which decreased expense approximately $115 in 2022. Thedeclines were partially offset by higher wholesale accessnetwork costs. As part of our transformation activities, weexpect continued operations and support expenseimprovements into 2023 as we further size our operationsin alignment with the strategic direction of the business.Depreciation expense increased in 2022, primarily due to\\nongoing capital investment for strategic initiatives such asfiber and network upgrades and expansion, partially offsetby updates to extend the estimated lives of our fiberassets (see Note 7).\\nOperating income decreased in 2022 and 2021. Our\\nBusiness Wireline operating income margin was 14.4% in2022, 16.8% in 2021 and 19.1% in 2020.',\n", " 'Our BusinessWireline EBITDA margin was 38.0% in 2022, 38.5% in 2021and 39.9% in 2020.\\nConsumer Wireline Results\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs.',\n", " '2021 2021 vs. 2020\\nOperating revenues\\nBroadband $ 9,669 $ 9,085 $ 8,534 6.4 % 6.5 %\\nLegacy voice and data services 1,746 1,977 2,213 (11.7) (10.7)\\nOther service and equipment 1,334 1,477 1,571 (9.7) (6.0)\\nTotal Operating Revenues 12,749 12,539 12,318 1.7 1.8\\nOperating expenses\\nOperations and support 8,253 8,448 7,942 (2.3) 6.4\\nDepreciation and amortization 3,169 3,095 2,914 2.4 6.2\\nTotal Operating Expenses 11,422 11,543 10,856 (1.0) 6.3\\nOperating Income $ 1,327 $ 996 $ 1,462 33.2 % (31.9)%\\nThe following tables highlight other key measures of performance for Consumer Wireline:\\nConnections\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs.',\n", " '2021 2021 vs. 2020\\nBroadband Connections\\nTotal Broadband and DSL Connections 13,991 14,160 14,100 (1.2)% 0.4 %\\nBroadband 13,753 13,845 13,693 (0.7) 1.1\\nFiber Broadband Connections 7,215 5,992 4,951 20.4 21.0\\nVoice Connections\\nRetail Consumer Switched Access Lines 2,028 2,423 2,862 (16.3) (15.3)\\nU-verse Consumer VoIP Connections 2,311 2,736 3,231 (15.5) (15.3)\\nTotal Retail Consumer Voice Connections 4,339 5,159 6,093 (15.9)% (15.3)%\\nBroadband Net Additions\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs. 2021 2021 vs.',\n", " '2021 2021 vs. 2020\\nTotal Broadband and DSL Net Additions (169) 60 (19) —% —%\\nBroadband Net Additions (92) 152 95 — 60.0\\nFiber Broadband Net Additions 1,223 1,041 1,064 17.5 % (2.2)%Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts',\n", " 'Broadband revenues increased in 2022, driven by an\\nincrease in fiber customers, which we expect to continuefor the foreseeable future as we invest further in buildingour fiber footprint, partially offset by declines in copper-based broadband services.\\nLegacy voice and data service revenues decreased in\\n2022, reflecting the continued decline in the number ofcustomers, which we expect to continue.\\nOther service and equipment revenues decreased in\\n2022, reflecting the continued decline in the number ofVoIP customers, which we expect to continue.\\nOperations and support expenses decreased in 2022,\\nprimarily driven by lower network and customer supportcosts, credits from a third-quarter 2022 retirement benefitplan change and lower HBO Max licensing fees. Alsocontributing to the decline was lower amortization ofdeferred fulfillment costs, including our first-quarter 2022\\nupdates to the estimated economic lives of broadband/fiber subscribers, which decreased expensesapproximately $130 in 2022. These declines were partiallyoffset by the elimination of CAF II government credits,higher bad debt expense and advertising costs.',\n", " 'Depreciation expense increased in 2022, primarily due to\\nongoing capital investment for strategic initiatives such asfiber and network upgrades and expansion, partially offsetby updates to the estimated lives of our fiber assets (seeNote 7).\\nOperating income increased in 2022 and decreased in\\n2021. Our Consumer Wireline operating income marginwas 10.4% in 2022, 7.9% in 2021 and 11.9% in 2020. OurConsumer Wireline EBITDA margin was 35.3% in 2022,32.6% in 2021 and 35.5% in 2020.\\nLATIN AMERICA SEGMENT\\nPercent Change\\n2022 2021 2020 2022 vs. 2021 2021 vs.',\n", " '2021 2021 vs. 2020\\nOperating revenues\\nService $ 2,162 $ 1,834 $ 1,656 17.9 % 10.7 %\\nEquipment 982 913 906 7.6 0.8\\nTotal Operating Revenues 3,144 2,747 2,562 14.5 7.2\\nOperating expenses\\nOperations and support 2,812 2,652 2,636 6.0 0.6\\nDepreciation and amortization 658 605 513 8.8 17.9\\nTotal Operating Expenses 3,470 3,257 3,149 6.5 3.4\\nOperating Income (Loss) $ (326) $ (510) $ (587) 36.1 % 13.1 %\\nThe following tables highlight other key measures of performance for Mexico:\\nSubscribers\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs. 2021 2021 vs.',\n", " '2021 2021 vs. 2020\\nPostpaid 4,925 4,807 4,696 2.5 % 2.4 %\\nPrepaid 16,204 15,057 13,758 7.6 9.4\\nReseller 474 498 489 (4.8) 1.8\\nMexico Wireless Subscribers 21,603 20,362 18,943 6.1 % 7.5 %\\nMexico Wireless Net Additions\\nPercent Change\\n(in 000s) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020\\nPostpaid 118 111 (407) 6.3 % —%\\nPrepaid 1,147 1,299 174 (11.7) —\\nReseller (24) 9 118 — (92.4)\\nMexico Wireless Net Additions 1,241 1,419 (115) (12.5)% —%\\nService revenues increased in 2022, reflecting growth in\\nwholesale services, subscribers and ARPU.\\nEquipment revenues increased in 2022, due to higher\\nequipment sales.',\n", " 'Equipment revenues increased in 2022, due to higher\\nequipment sales.\\nOperations and support expenses increased in 2022, due\\nto higher acquisition costs, bad debt and networkexpenses. Approximately 5% of Mexico expenses are U.S.dollar-based, with the remainder in the local currency.Depreciation expense increased in 2022, reflecting higher\\nin-service assets.\\nOperating income improved in 2022 and 2021. Our Mexico\\noperating income margin was (10.4)% in 2022, (18.6)% in2021 and (22.9)% in 2020. Our Mexico EBITDA margin was10.6% in 2022, 3.5% in 2021 and (2.9)% in 2020.\\n\\t.',\n", " 'OPERATING ENVIRONMENT AND TRENDS OF THE\\nBUSINESS\\n2023 Revenue Trends We expect revenue growth in our\\nwireless and broadband businesses as customers demandinstant connectivity and higher speeds made possible bywireless network enhancements through 5G deploymentand our fiber network expansion. We believe that oursimplified go-to-market strategy for 5G inunderpenetrated markets will continue to contribute towireless subscriber and service revenue growth and thatexpansion of our fiber footprint and our multi-gigofferings will drive greater demand for broadbandservices on our fast-growing fiber network.\\nAs we expand our fiber reach, we will be orienting our\\nbusiness portfolio to leverage this opportunity to offsetcontinuing declines in legacy Business Wireline productsby growing connectivity with small to mid-sizedbusinesses. We plan to use our strong fiber and wirelessassets, broad distribution and converged product offersto strengthen our overall market position. We willcontinue to rationalize our product portfolio with alonger-term shift of the business to fiber and mobileconnectivity, and growth in value-added services .\\n2023 Expense Trends We expect the spending required to\\nsupport growth initiatives, primarily our continueddeployment of fiber and 5G to pressure expense trends in2023.',\n", " 'To the extent customers further upgrade theirhandsets in 2023, the expenses associated with thosedevice sales are expected to contribute to higher costs.During 2023, we will also continue to prioritize efficiency,led by our cost transformation initiative. Theseinvestments will help prepare us to meet increasedcustomer demand for enhanced wireless and broadbandservices, including video streaming, augmented reality and“smart” technologies. The software benefits of our 5Gwireless technology should result in a more efficient useof capital and lower network-related expenses in thecoming years.\\nWe continue to transform our operations to be more\\nefficient and effective. We are restructuring businesses,sunsetting legacy networks, improving customer serviceand ordering functions through digital transformation,sizing our support costs and staffing with current activitylevels, and reassessing overall benefit costs. Cost savingsand asset sales align with our focus on debt reduction.Market Conditions The U.S. stock market experienced\\nvolatility and contraction in 2022. Several factors, includingthe continued impact from the global pandemic, haveresulted in changes in demand in business communicationservices.',\n", " 'The global pandemic has caused, and could againcause, delays in the development, manufacturing(including the sourcing of key components) and shipmentof products, as well as continued tight labor market andactual or perceived inflation. Most of our products andservices are not directly affected by the imposition oftariffs on Chinese goods. However, we expect ongoingpressure on pricing during 2023 as we respond to thegeopolitical and macroeconomic environment and ourcompetitive marketplace, especially in wireless services.\\nIncluded on our consolidated balance sheets are assets\\nheld by benefit plans for the payment of future benefits.Our pension plans are subject to funding requirements ofthe Employee Retirement Income Security Act of 1974, asamended (ERISA). We expect only minimal ERISAcontribution requirements to our pension plans for 2023.Investment returns on these assets depend largely ontrends in the economy, and a weakness in the equity, fixedincome and real asset markets could require us to makefuture contributions to the pension plans.',\n", " 'In addition, ourpolicy of recognizing actuarial gains and losses related toour pension and other postretirement plans in the periodin which they arise subjects us to earnings volatilitycaused by changes in market conditions; however, theseactuarial gains and losses do not impact segmentperformance as they are required to be recorded in “Otherincome (expense) – net.” Changes in our discount rate,which are tied to changes in the bond market, andchanges in the performance of equity markets, may havesignificant impacts on the valuation of our pension andother postretirement obligations at the end of 2023 (see“Critical Accounting Policies and Estimates”).Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n\\t:',\n", " 'OPERATING ENVIRONMENT OVERVIEW\\nAT&T subsidiaries operating within the United States are\\nsubject to federal and state regulatory authorities. AT&Tsubsidiaries operating outside the United States aresubject to the jurisdiction of national and supranationalregulatory authorities in the markets where service isprovided.\\nIn the Telecommunications Act of 1996 (Telecom Act),\\nCongress established a national policy frameworkintended to bring the benefits of competition andinvestment in advanced telecommunications facilities andservices to all Americans by opening alltelecommunications markets to competition andreducing or eliminating regulatory burdens that harmconsumer welfare. Nonetheless, over the ensuing twodecades, the Federal Communications Commission (FCC)and some state regulatory commissions have maintainedor expanded certain regulatory requirements that wereimposed decades ago on our traditional wirelinesubsidiaries when they operated as legal monopolies.More recently, the FCC has pursued a more deregulatoryagenda, eliminating a variety of antiquated andunnecessary regulations and streamlining its processes ina number of areas.',\n", " 'We continue to support regulatory andlegislative measures and efforts, at both the state andfederal levels, to reduce inappropriate regulatory burdensthat inhibit our ability to compete effectively and offerneeded services to our customers, including initiatives totransition services from traditional networks to all IP-based networks. At the same time, we also seek to ensurethat legacy regulations are not further extended tobroadband or wireless services, which are subject tovigorous competition.\\nInternet The FCC currently classifies fixed and mobile\\nconsumer broadband services as information services,subject to light-touch regulation. However, some stateshave adopted legislation or issued executive orders thatwould reimpose net neutrality rules repealed by the FCC.Suits were filed concerning such laws in California andVermont. The California suit was dismissed withoutprejudice on May 4, 2022, and the California statute is nowin effect. The litigation challenging the Vermont statutehas been stayed pending the Second Circuit’s dispositionof an appeal by the State of New York of an orderenjoining enforcement of a New York statute regulatingbroadband rates on the ground that such statute ispreempted by federal law. We expect additional statesmay seek to impose net neutrality requirements in thefuture.',\n", " 'We expect additional statesmay seek to impose net neutrality requirements in thefuture.\\nOn November 15, 2021, the Infrastructure Investment and\\nJobs Act (IIJA) was signed into law. The legislationappropriates $65,000 to support broadband deploymentand adoption. The National Telecommunications andInformation Agency (NTIA) is responsible for distributingmore than $48,000 of this funding, including $42,500 instate grants for broadband deployment projects inunserved and underserved areas. NTIA established initialrequirements for this program in May 2022 and isexpected to announce state grant allocations in 2023.The IIJA also appropriated $14,200 for establishment of\\nthe Affordable Connectivity Program (ACP), an FCC-administered monthly, low-income broadband benefitprogram, replacing the Emergency Broadband Benefitprogram (established in December 2020 by theConsolidated Appropriations Act, 2021). Qualifyingcustomers can receive up to thirty dollars per month (orseventy-five dollars per month for those on Tribal lands)to assist with their internet bill. AT&T is a participatingprovider in the ACP program and will considerparticipating in the deployment program whereappropriate.',\n", " 'The IIJA includes various provisions that haveresulted in FCC proceedings regarding ACP programadministration and consumer protection, reform of theexisting universal support program, and broadbandlabeling and equal access.\\nPrivacy-related legislation continues to be adopted or\\nconsidered in a number of jurisdictions. Legislative,regulatory and litigation actions could result in increasedcosts of compliance, further regulation or claims againstbroadband internet access service providers and others,and increased uncertainty in the value and availability ofdata.\\nWireless Industry-wide network densification and 5G\\ntechnology expansion efforts, which are needed to satisfyextensive demand for video and internet access, willinvolve significant deployment of “small cell” equipment.This increases the importance of local permittingprocesses that allow for the placement of small cellequipment in the public right-of-way on reasonabletimelines and terms. The FCC has adopted multiple Ordersstreamlining federal, state, and local wireless structurereview processes that had the tendency to delay andimpede deployment of small cell and relatedinfrastructure used to provide telecommunications andbroadband services. During 2020-2021, we have alsodeployed 5G nationwide on “low band” spectrum onmacro towers.',\n", " 'Executing on the recent spectrumpurchase, we announced ongoing construction andcontinuing deployment of 5G on C-band spectrum in 2022and beyond.\\nEXPECTED GROWTH AREAS\\nOver the next few years, we expect our growth to come\\nfrom wireless and IP-based fiber broadband services. Weprovide integrated services to diverse groups ofcustomers in the U.S. on an integratedtelecommunications network utilizing differenttechnological platforms. In 2023, our key initiatives include:\\n• Continuing our wireless subscriber momentum and\\n5G deployment, with expansion of 5G service,\\nincluding to underpenetrated markets.\\n• Improving fiber penetration, accelerating subscriber\\ngrowth and increasing broadband revenues.\\n• Continuing to drive efficiencies and a competitive\\nadvantage through cost transformation initiatives\\nand product simplification.\\n\\t,',\n", " 'Wireless We expect to continue to deliver revenue\\ngrowth in the coming years. We are in a period of rapidgrowth in wireless video usage and believe that there aresubstantial opportunities available for next-generationconverged services that combine technologies andservices. As of December 31, 2022, we served 239 millionwireless subscribers in North America, with more than 217million in the United States.\\nOur LTE technology covers over 441 million people in\\nNorth America, and in the United States, we cover allmajor metropolitan areas and over 337 million people. Wealso provide 4G coverage using another technology(HSPA+), and when combined with our upgraded backhaulnetwork, we provide enhanced network capabilities andsuperior mobile broadband speeds for data and videoservices. In December 2018, we introduced the nation’sfirst commercial mobile 5G service and expanded thatdeployment nationwide in July 2020. At December 31,2022, our network covers more than 285 million peoplewith 5G technology in the United States and NorthAmerica.\\nOur networks covering both the U.S. and Mexico have\\nenabled our customers to use wireless services withoutroaming on other companies’ networks.',\n", " 'We believe thisseamless access will prove attractive to customers andprovide a significant growth opportunity. At December 31,2022, we provided LTE coverage to over 104 million peoplein Mexico.\\nIntegration of Data and Broadband Services As the\\ncommunications industry has evolved into internet-basedtechnologies capable of blending wireline and wirelessservices, we plan to focus on expanding our wirelessnetwork capabilities and provide broadband offerings thatallow customers to integrate their home or business fixedservices with their mobile service. In January 2022, welaunched our multi-gig rollout, which brings the fastestinternet to AT&T Fiber customers with symmetrical 2 gigand 5 gig tiers. We will continue to develop and provideunique integrated mobile and broadband/fiber solutions.\\nREGULATORY DEVELOPMENTS\\nSet forth below is a summary of the most significant\\nregulatory proceedings that directly affected ouroperations during 2022. Industry-wide regulatorydevelopments are discussed above in OperatingEnvironment Overview. While these issues may apply onlyto certain subsidiaries, the words “we,” “AT&T” and “our”are used to simplify the discussion.',\n", " 'The followingdiscussions are intended as a condensed summary of theissues rather than as a comprehensive legal analysis anddescription of all of these specific issues.\\nInternational Regulation Our subsidiaries operating\\noutside the United States are subject to the jurisdiction ofregulatory authorities in the territories in which thesubsidiaries operate. Our licensing, compliance andadvocacy initiatives in foreign countries primarily enablethe provision of enterprise (i.e., large business) servicesglobally and wireless services in Mexico.The General Data Protection Regulation went into effect\\nin Europe in May of 2018. AT&T processes and handlespersonal data of its customers and subscribers,employees of its enterprise customers and its employees.This regulation created a range of new complianceobligations and significantly increased financial penaltiesfor noncompliance.\\nFederal Regulation We have organized our following\\ndiscussion by service impacted.\\nInternet The FCC currently classifies fixed and mobile\\nconsumer broadband services as information services,subject to light-touch regulation. The D.C.',\n", " 'The D.C. Circuit upheldthe FCC’s current classification, although it remandedthree discrete issues to the FCC for further consideration.These issues related to the effect of the FCC’s decision toclassify broadband services as information services onpublic safety, the regulation of pole attachments, anduniversal service support for low-income consumersthrough the Lifeline program. Because no party soughtSupreme Court review of the D.C. Circuit’s decision touphold the FCC’s classification of broadband as aninformation service, that decision is final.\\nIn October 2020, the FCC adopted an order addressing the\\nthree issues remanded by the D.C. Circuit for furtherconsideration. After considering those issues, the FCCconcluded there were no grounds to depart from itsdetermination that fixed and mobile consumer broadbandservices should be classified as information services. Anappeal of the FCC’s remand decision is pending.\\nSome states have adopted legislation or issued executive\\norders that would reimpose net neutrality rules repealedby the FCC. Suits were filed concerning such laws inCalifornia and Vermont. The California suit was dismissedwithout prejudice on May 4, 2022, and the Californiastatute is now in effect.',\n", " 'The litigation challenging theVermont statute has been stayed pending the SecondCircuit’s disposition of an appeal by the State of New Yorkof an order enjoining enforcement of a New York statuteregulating broadband rates on the ground that suchstatute is preempted by federal law. We expect additionalstates may seek to impose net neutrality requirements inthe future.\\nOn November 15, 2021, President Biden signed the IIJA into\\nlaw. The legislation appropriates funds to supportbroadband deployment and adoption. The NTIA isresponsible for distributing the majority of these fundsprimarily through state grants for broadband deploymentprojects in unserved and underserved areas, and to alesser extent for middle mile broadband infrastructure,and digital equity programs. On May 13, 2022, NTIA issuedthree Notices of Funding Opportunity for these initiatives– the Broadband Equity, Access, and Deployment Program,the Enabling Middle Mile Broadband InfrastructureProgram, and the State Digital Equity Program.',\n", " 'NTIA willcontinue to administer and implement these programs.The IIJA also appropriated funds for establishment of theACP, an FCC-administered monthly, low-incomeManagement’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n\\t;',\n", " 'broadband benefit program, replacing the Emergency\\nBroadband Benefit program. Qualifying customers canreceive reimbursements to assist with their internet bill.AT&T is a participating provider in the ACP program andwill consider participating in the deployment programwhere appropriate. The IIJA includes various provisionsthat have resulted in FCC proceedings regarding ACPprogram administration and consumer protection, reformof the existing universal support program, and broadbandlabeling and equal access.\\nPrivacy-related legislation continues to be adopted or\\nconsidered in a number of jurisdictions. Legislative,regulatory and litigation actions could result in increasedcosts of compliance, further regulation or claims againstbroadband internet access service providers and others,and increased uncertainty in the value and availability ofdata.\\nWireless and Broadband In June and November 2020, the\\nFCC issued a Declaratory Ruling clarifying the limits onstate and local authority to deny applications to modifyexisting structures to accommodate wireless facilities.Appeals of the November 2020 order remain pending inthe Ninth Circuit Court of Appeals, following multiplerequests by the FCC to hold the appeal in abeyance untilthe Senate confirms a fifth FCC Commissioner.',\n", " 'Ifsustained on appeal, these FCC decisions will removestate and local regulatory barriers and reduce the costs ofthe infrastructure needed for 5G and FirstNetdeployments, which will enhance our ability to place smallcell facilities on utility poles, expand existing facilities toaccommodate public safety services, and replace legacyfacilities and services with advanced broadbandinfrastructure and services. During 2022, we have alsodeployed 5G nationwide on “low band” spectrum onmacro towers. Executing on the recent spectrumpurchase, we continued deploying 5G nationwide on “lowband” spectrum.\\nIn March 2020, the FCC released its order setting rules for\\ncertain spectrum bands (C-band) for 5G operations. Inthat order, the FCC concluded that C-band 5G servicesthat met the agency’s technical limits on power andemissions would not cause harmful interference withaircraft operations. In reliance on that order, AT&T bid atotal of $23,406 and was awarded 1,621 C-band licenses,including 40 MHz available for deployment in December2021, with the remainder available for deployment no laterthan December 2023.',\n", " 'In late 2021, the Federal AviationAdministration (FAA) questioned whether the C-bandlaunch could impact radio altimeter equipment onairplanes, which operate on spectrum bands over 400 MHzaway from the spectrum AT&T launched in 2022 and 220MHz away from spectrum AT&T plans to launch in 2023. Inresponse, to allow the FAA more time to evaluate, AT&Tand Verizon delayed their planned December 2021 5G C-band launch by six weeks and voluntarily committed to aseries of temporary, precautionary measures, in additionto deferring turning on a limited number of towers aroundcertain airports. These measures have been subsequentlymodified from time to time. We continue to work with the\\nFAA to reduce the temporary measures with C-banddeployments as aircraft equipment is upgraded.\\nIn recent years, the FCC took several actions to make\\nspectrum available for 5G services, including the auctionof 280 MHz of mid-band spectrum previously used forsatellite service (the “C Band” auction) and 39 GHz bandspectrum. AT&T obtained spectrum in these auctions (see“Other Business Matters”).',\n", " 'AT&T obtained spectrum in these auctions (see“Other Business Matters”). The FCC also made 150 MHz ofmid-band CBRS spectrum available, to be shared withFederal incumbents, which enjoy priority. In addition, theFCC recently completed Auction 110, in which AT&T won40 MHz of 3.45 GHz spectrum nationwide at a cost of$9,079.\\nCOMPETITION\\nCompetition continues to increase for communications\\nand digital services from traditional and nontraditionalcompetitors. Technological advances have expanded thetypes and uses of services and products available. Inaddition, lack of or a reduced level of regulation ofcomparable legacy services has lowered costs foralternative communications service providers. As a result,we face continuing competition as well as some newopportunities in significant portions of our business.\\nWireless We face substantial competition in our wireless\\nbusinesses. Under current FCC rules, multiple licensees,who provide wireless services on the cellular, PCS,Advanced Wireless Services, 700 MHz and other spectrumbands, may operate in each of our U.S. service areas.',\n", " 'service areas. Ourcompetitors include two national wireless providers; alarger number of regional providers and resellers of thoseservices; and certain cable companies. In addition, we facecompetition from providers who offer voice, textmessaging and other services as applications on datanetworks. We are one of three facilities-based providers inMexico (retail and wholesale), with the most significantmarket share controlled by América Móvil. We mayexperience significant competition from companies thatprovide similar services using other communicationstechnologies and services. While some of thesetechnologies and services are now operational, others arebeing developed or may be developed. We compete forcustomers based principally on service/device offerings,price, network quality, coverage area and customerservice.\\nBroadband The desire for high-speed data on demand,\\nincluding video, is continuing to lead customers toterminate their traditional wired or linear services and useour fiber services or competitors’ wireless, satellite andinternet-based services. In most U.S. markets, we competefor customers with large cable companies for high-speedinternet and voice services, wireless broadband providers,and other smaller telecommunications companies forboth long-distance and local services.\\n\\t?',\n", " 'Legacy Voice and Data We continue to lose legacy voice\\nand data subscribers due to competitors (e.g., wireless,cable and VoIP providers) who can provide comparableservices at lower prices because they are not subject totraditional telephone industry regulation (or the extent ofregulation they are subject to is in dispute), utilizedifferent technologies or promote a different businessmodel (such as advertising-based).\\nAdditionally, we provide local and interstate telephone\\nand switched services to other service providers, primarilylarge internet service providers using the largest class ofnationwide internet networks (internet backbone),wireless carriers, other telephone companies, cablecompanies and systems integrators. These services aresubject to additional competitive pressures from thedevelopment of new technologies, the introduction ofinnovative offerings and increasing satellite, wireless,fiber-optic and cable transmission capacity for services.\\nACCOUNTING POLICIES AND STANDARDS\\nCritical Accounting Policies and Estimates Because of\\nthe size of the financial statement line items they relate toor the extent of judgment required by our management,some of our accounting policies and estimates have amore significant impact on our consolidated financialstatements than others.',\n", " 'Pension and Postretirement Benefits Our actuarial\\nestimates of retiree benefit expense and the associatedsignificant weighted-average assumptions are discussedin Note 14. Our assumed weighted-average discount ratesfor both pension and postretirement benefits of 5.20%, atDecember 31, 2022, reflect the hypothetical rate at whichthe projected benefit obligations could be effectivelysettled or paid out to participants. We determined ourdiscount rate based on a range of factors, including a yieldcurve composed of the rates of return on several hundredhigh-quality, fixed income corporate bonds available atthe measurement date and corresponding to the relatedexpected durations of future cash outflows for theobligations. These bonds had an average rating of at leastAa3 or AA- by the nationally recognized statistical ratingorganizations, denominated in U.S. dollars, and generallynot callable, convertible or index linked.',\n", " 'dollars, and generallynot callable, convertible or index linked. For the yearended December 31, 2022, when compared to the yearended December 31, 2021, we increased our pensiondiscount rate by 2.20%, resulting in a decrease in ourpension plan benefit obligation of $11,738, and increasedour postretirement discount rate by 2.40%, resulting in adecrease in our postretirement benefit obligation of$2,102.\\nOur expected long-term rate of return was 6.75% on\\npension plan assets and 4.50% on postretirement planassets for 2022. We have increased our expected return onplan assets to 7.50% on pension plan assets and 6.50% onpostretirement plan assets for 2023, reflecting higherlong-term capital market expectations for equities andhigher yields for bonds. Our expected return on planassets is calculated using the actual fair value of planassets.',\n", " 'Our expected return on planassets is calculated using the actual fair value of planassets. If all other factors were to remain unchanged, we\\nexpect that a 0.50% decrease in the expected long-termrate of return would cause 2023 combined pension andpostretirement cost to increase $201, which under ouraccounting policy would be adjusted to actual returns inthe current year upon remeasurement of our retireebenefit plans.\\nWe recognize gains and losses on pension and\\npostretirement plan assets and obligations immediately in“Other income (expense) – net” in our consolidatedstatements of income. These gains and losses aregenerally measured annually as of December 31, andaccordingly, will normally be recorded during the fourthquarter, unless an earlier remeasurement is required.Should actual experience differ from actuarialassumptions, the projected pension benefit obligation andnet pension cost and accumulated postretirement benefitobligation and postretirement benefit cost would beaffected in future years. See Note 14 for additionaldiscussions regarding our assumptions.\\nDepreciation Our depreciation of assets, including use of\\ncomposite group depreciation for certain subsidiaries andestimates of useful lives, is described in Notes 1 and 7.',\n", " 'If all other factors were to remain unchanged, we expect\\nthat a one-year increase in the useful lives of our plant inservice would have resulted in a decrease ofapproximately $2,653 in our 2022 depreciation expenseand that a one-year decrease would have resulted in anincrease of approximately $3,778 in our 2022 depreciationexpense. See Notes 7 and 8 for depreciation andamortization expense applicable to property, plant andequipment, including our finance lease right-of-use assets.\\nAsset Valuations and ImpairmentsGoodwill and other indefinite-lived intangible assets are\\nnot amortized but tested at least annually on October 1for impairment. For impairment testing, we estimate fairvalues using models that predominantly rely on theexpected cash flows to be derived from the reporting unitor use of the asset. Long-lived assets are reviewed forimpairment whenever events or circumstances indicatethat the book value may not be recoverable over theremaining life. Inputs underlying the expected cash flowsinclude, but are not limited to, subscriber counts, revenueper user, capital investment and acquisition costs persubscriber, and ongoing operating costs.',\n", " 'We based ourassumptions on a combination of our historical results,trends, business plans and marketplace participant data.\\nAnnual Goodwill Testing\\nGoodwill is tested on a reporting unit basis by comparing\\nthe estimated fair value of each reporting unit to its bookvalue. If the fair value exceeds the book value, then noimpairment is measured. We estimate fair values using anincome approach (also known as a discounted cash flowmodel) and a market multiple approach. The incomeapproach utilizes our future cash flow projections with aperpetuity value discounted at an appropriate weightedManagement’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n\\t!',\n", " 'average cost of capital. The market multiple approach\\nuses the multiples of publicly traded companies whoseservices are comparable to those offered by the reportingunits.\\nAs of October 1, 2022, the calculated fair value of the\\nMobility reporting unit exceeded its book value and noadditional testing was necessary. If either the projectedrate of long-term growth of Mobility cash flows orrevenues declined by 0.5%, or if the weighted averagecost of capital increased by 0.5%, the fair value would stillbe higher than the book value of the goodwill. In the eventof a 10% drop in the fair value of the Mobility reportingunit, the fair value still would have exceeded the bookvalue of the reporting unit.\\nOur 2022 annual goodwill impairment analysis resulted in\\nnoncash impairment charges related to our BusinessWireline, Consumer Wireline and Mexico reporting units.The decline in fair values was primarily due to changes inthe macroeconomic environment, namely increasedweighted-average cost of capital. Also, inflation pressureand lower projected cash flows driven by secular declines,predominantly at Business Wireline, impacted the fairvalues.',\n", " 'Future sustained declines in macroeconomic orbusiness conditions, or higher discount rates or declines inthe value of AT&T stock could result in goodwillimpairment charges in future periods. A summary ofbusiness unit goodwill impairment by segment andsensitivity analysis is as follows:\\nCommunicationsLatin\\nAmerica\\nBusiness\\nWirelineConsumer\\nWireline Mexico\\nGoodwill as ofOctober 1, 2022: $ 17,903 $ 30,155 $ 826\\nImpairment charge (13,478) (10,508) (826)\\nRemaining Goodwill at\\nDecember 31, 2022 $ 4,425 $ 19,647 $ —\\nSensitivity analysis,\\napproximate hypotheticalimpairment charge:\\nWeighted-average cost of\\ncapital increase of 25 BP $ 1,200 $ 2,200 $ —\\nProjected terminal growth\\nrate decline of 25 BP 700 1,400 —\\nProjected long-term EBITDA\\nmargin decline of 100 BP 1,500 1,300 —\\nU.S. Wireless Licenses\\nThe fair value of U.S.',\n", " 'Wireless Licenses\\nThe fair value of U.S. wireless licenses is assessed using a\\ndiscounted cash flow model (the Greenfield Approach)and a qualitative corroborative market approach based onauction prices, depending upon auction activity. TheGreenfield Approach assumes a company initially ownsonly the wireless licenses and makes investments requiredto build an operation comparable to current use. These\\nlicenses are tested annually for impairment on anaggregated basis, consistent with their use on a nationalscope for the United States. For impairment testing, weassume subscriber and revenue growth will trend up toprojected levels, with a long-term growth rate reflectingexpected long-term inflation trends. We assume churnrates will initially exceed our current experience butdecline to rates that are in line with industry-leadingchurn. We used a discount rate of 9.50%, based on theoptimal long-term capital structure of a marketparticipant and its associated cost of debt and equity forthe licenses, to calculate the present value of theprojected cash flows.',\n", " 'If either the projected rate of long-term growth of cash flows or revenues declined by 0.5%,or if the discount rate increased by 0.5%, the fair values ofthese wireless licenses would still be higher than the bookvalue of the licenses. The fair value of these wirelesslicenses exceeded their book values by more than 10%.\\nOther Finite-Lived Intangibles\\nCustomer relationships, licenses in Mexico and other\\nfinite-lived intangible assets are reviewed for impairmentwhenever events or circumstances indicate that the bookvalue may not be recoverable over their remaining life. Forthis analysis, we compare the expected undiscountedfuture cash flows attributable to the asset to its bookvalue. When the asset’s book value exceeds undiscountedfuture cash flows, an impairment is recorded to reducethe book value of the asset to its estimated fair value (seeNotes 7 and 9).\\nIncome Taxes Our estimates of income taxes and the\\nsignificant items giving rise to the deferred assets andliabilities are shown in Note 13 and reflect our assessmentof actual future taxes to be paid on items reflected in thefinancial statements, giving consideration to both timingand probability of these estimates.',\n", " 'Actual income taxescould vary from these estimates due to future changes inincome tax law or the final review of our tax returns byfederal, state or foreign tax authorities.\\nWe use our judgment to determine whether it is more\\nlikely than not that we will sustain positions that we havetaken on tax returns and, if so, the amount of benefit toinitially recognize within our financial statements. Weregularly review our uncertain tax positions and adjust ourunrecognized tax benefits (UTBs) in light of changes infacts and circumstances, such as changes in tax law,interactions with taxing authorities and developments incase law. These adjustments to our UTBs may affect ourincome tax expense. Settlement of uncertain tax positionsmay require use of our cash.\\nNew Accounting StandardsSee Note 1 for discussion of recently issued or adopted\\naccounting standards.\\n\\t¿',\n", " 'OTHER BUSINESS MATTERS\\nSpectrum Auctions On January 14, 2022, the FCC\\nannounced that we were the winning bidder for 1,624 3.45GHz licenses in Auction 110. We provided the FCC anupfront deposit of $123 in the third quarter of 2021 andpaid the remaining $8,956 in the first quarter of 2022, for atotal of $9,079. We received the licenses in May 2022, andclassified the auction deposits and related capitalizedinterest as “Licenses – Net” on our December 31, 2022consolidated balance sheet.\\nOn February 24, 2021, the FCC announced that AT&T was\\nthe winning bidder for 1,621 C-Band licenses, comprised ofa total of 80 MHz nationwide, including 40 MHz in Phase I.We provided to the FCC an upfront deposit of $550 in 2020and cash payments totaling $22,856 in the first quarter of2021, for a total of $23,406.',\n", " 'We received the licenses in July2021 and classified the auction deposits, relatedcapitalized interest and billed relocation costs as “Licenses– Net” on our December 31, 2021 consolidated balancesheet. In December 2021, we paid $955 of IncentivePayments for the clearing of Phase I spectrum andestimate that we will be responsible for an additional$2,112 upon clearing of Phase II spectrum, expected by theend of 2023. Additionally, we are responsible forapproximately $1,100 of compensable relocation costsover the next several years as the spectrum is beingcleared by satellite operators, of which we paid $650 inthe fourth quarter of 2021 and $98 in the third quarter of2022.\\nWarnerMedia On April 8, 2022, we completed the\\nseparation and distribution of our WarnerMedia business,and merger of Magallanes, Inc. (Spinco), an AT&Tsubsidiary formed to hold the WarnerMedia business, witha subsidiary of Discovery, Inc., which was renamed WarnerBros. Discovery, Inc. (WBD).',\n", " 'Discovery, Inc. (WBD). Each AT&T shareholder wasentitled to receive 0.241917 shares of WBD common stockfor each share of AT&T common stock held as of therecord date, which represented approximately 71% ofWBD. In connection with and in accordance with the termsof the Separation and Distribution Agreement (SDA), priorto the distribution and merger, AT&T receivedapproximately $40,400, which includes $38,800 of Spincocash and $1,600 of debt retained by WarnerMedia. Duringthe second quarter of 2022, assets of approximately$121,100 and liabilities of $70,600 were removed from ourbalance sheet as well as $45,041 of retained earnings and$5,632 of additional paid-in capital associated with thetransaction. Additionally, in August 2022, we and WBDfinalized the post-closing adjustment, pursuant to Section1.3 of the SDA, which resulted in a $1,200 payment to WBDin the third quarter of 2022 and was reflected in theDecember 31, 2022 balance sheet as an adjustment toadditional paid-in capital.',\n", " 'The payment is accounted for ascash used in financing activities in our statement of cashflows in third quarter of 2022. (See Note 6)\\nAT&T, Spinco and Discovery entered into a Tax Matters\\nAgreement, which governs the parties’ rights,responsibilities and obligations with respect to tax\\nliabilities and benefits, the preservation of the expectedtax-free status of the transactions contemplated by theSDA, and other matters regarding taxes.\\nAdditionally, we entered into an adjusted HBO Max\\nagreement with WBD that provides us with expandeddistribution rights and additional flexibility to market andsell the service in a cost-efficient manner. Under theterms of the agreement, beginning June 1, 2022, we arepermitted to include HBO Max in our customer offeringsin exchange for a licensing fee. Furthermore, AT&T has theright, but not the obligation, to market and distribute HBOMax to its customers in plans, bundles, and promotionaloffers.\\nXandr On June 6, 2022, we completed the sale of the\\nmarketplace component of Xandr to MicrosoftCorporation. Xandr was reflected in our historical financialstatements as discontinued operations.',\n", " 'Xandr was reflected in our historical financialstatements as discontinued operations. (See Note 6)\\nGigapower, LLC On December 22, 2022, we agreed to\\nform Gigapower, LLC (Gigapower), a joint venture withBlackRock Alternatives, to provide a fiber network toInternet service providers and other businesses across theU.S. that serve customers outside of our traditional 21-state wireline footprint. The transaction is subject tocustomary closing conditions, including regulatoryapprovals. Upon closing the joint venture, we expect todeconsolidate Gigapower’s operations.\\nLabor Contracts As of January 31, 2023, we employed\\napproximately 160,700 persons. Approximately 42% of ouremployees are represented by the CommunicationsWorkers of America (CWA), the International Brotherhoodof Electrical Workers (IBEW) or other unions. Afterexpiration of the collective bargaining agreements, workstoppages or labor disruptions may occur in the absenceof new contracts or other agreements being reached. Themain contracts included the following:\\n• A contract covering approximately 7,000 Mobility\\nemployees in nine states, for which we reachedtentative agreement in February 2023.',\n", " '• A contract covering approximately 400 employees\\nsupporting internet-based products is set to expire inJuly 2023.\\n• A contract covering approximately 200 Mobility\\nemployees in Illinois is set to expire in May 2023.\\nInflation Reduction Act The Inflation Reduction Act of\\n2022 (Inflation Reduction Act) was enacted on August 16,2022. The Inflation Reduction Act imposes a new 15%corporate alternative minimum tax (CAMT) on “applicablecorporations” for taxable years beginning after December31, 2022. The CAMT is imposed to the extent thealternative minimum tax exceeds a company’s regular taxliability. A corporation that pays alternative minimum taxis eligible for a credit against income tax in future years.Subject to future regulatory guidance, we currently do notbelieve the CAMT will have a material impact on our 2023tax liability.Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n \\x08',\n", " 'OECD On October 8, 2021, the Organization for Economic\\nCo-operation and Development (OECD) announced theOECD/G20 Inclusive Framework on Base Erosion andProfit Shifting which agreed to a two-pillar solution toaddress tax challenges arising from digitalization of theeconomy. On December 20, 2021, the OECD released PillarTwo Model Rules defining the global minimum tax, whichcalls for the taxation of large corporations at a minimumrate of 15%. The OECD continues to release additionalguidance on the two-pillar framework with widespreadimplementation anticipated by 2024. There can be noassurance that these new rules will not increase our taxesin these countries and have an adverse impact on ourprovision for income taxes, when enacted or enforced byparticipating countries in which we do business.\\nEnvironmental We are subject from time to time to\\njudicial and administrative proceedings brought by variousgovernmental authorities under federal, state or localenvironmental laws. We reference in our Forms 10-Q and10-K certain environmental proceedings that could resultin monetary sanctions (exclusive of interest and costs) ofthree hundred thousand dollars or more.',\n", " 'However, we donot believe that any of those currently pending will have amaterial adverse effect on our results of operations.\\nLIQUIDITY AND CAPITAL RESOURCES\\nContinuing operations for the\\nyears ended December 31, 2022 2021 2020\\nCash provided by operating\\nactivities $ 35,812 $ 37,170 $ 37,484\\nCash used in investing\\nactivities (26,899) (32,489) (13,447)\\nCash (used in) provided by\\nfinancing activities (59,564) 1,894 (31,031)\\nAt December 31, 2022 2021\\nCash and cash equivalents $ 3,701 $ 19,223\\nTotal debt 135,890 175,631\\nWe had $3,701 in cash and cash equivalents available at\\nDecember 31, 2022, decreasing $15,522 since December 31,2021 and returning to historical levels with the close of theWarnerMedia/Discovery transaction. Cash and cashequivalents included cash of $866 and money marketfunds and other cash equivalents of $2,835.',\n", " 'Approximately$1,045 of our cash and cash equivalents were held by ourforeign entities in accounts predominantly outside of theU.S. and may be subject to restrictions on repatriation.\\nIn 2022, cash inflows were primarily provided by cash\\nreceipts from operations, including cash from our sale andtransfer of our receivables to third parties, cash receivedin connection with the separation and distribution of theWarnerMedia business, issuance of commercial paper andlong-term debt and distributions from DIRECTV. Theseinflows were exceeded by cash used to meet the needs ofthe business, including, but not limited to, payment ofoperating expenses, spectrum acquisitions, funding capital\\nexpenditures and vendor financing payments, repaymentof short-term borrowings and long-term debt, anddividend payments to stockholders. We maintainavailability under our credit facilities and our commercialpaper program to meet our short-term liquidityrequirements.\\nRefer to “Contractual Obligations” discussion below for\\nadditional information regarding our cash requirements.',\n", " 'Refer to “Contractual Obligations” discussion below for\\nadditional information regarding our cash requirements.\\nCash Provided by Operating Activities from Continuing\\nOperations\\nDuring 2022, cash provided by operating activities was\\n$35,812 compared to $37,170 in 2021, reflecting theseparation of DIRECTV and working capital impacts,including higher payments for wireless devices tied toaccelerated subscriber growth.\\nWe actively manage the timing of our supplier payments\\nfor operating items to optimize the use of our cash.Among other things, we seek to make payments on 90-day or greater terms, while providing the suppliers withaccess to bank facilities that permit earlier payments attheir cost. In addition, for payments to a key supplier, aspart of our working capital initiatives, we havearrangements that allow us to extend the stated paymentterms by up to 90 days at an additional cost to us(referred to as supplier financing). The net impact ofsupplier financing was to improve cash from operatingactivities $851 in 2022 and $25 in 2021. All supplierfinancing payments are due within one year.',\n", " 'All supplierfinancing payments are due within one year.\\nCash Used in or Provided by Investing Activities from\\nContinuing Operations\\nDuring 2022, cash used in investing activities totaled\\n$26,899, consisting primarily of $19,626 (including interestduring construction) for capital expenditures, and $10,200for acquisitions of licenses won in Auction 110 andassociated capitalized interest. In 2022, we received areturn of investment of $2,649 from DIRECTVrepresenting distributions in excess of cumulative equityin earnings from DIRECTV (see Note 10).\\nFor capital improvements, we have negotiated favorable\\nvendor payment terms of 120 days or more (referred to asvendor financing) with some of our vendors, which areexcluded from capital expenditures and reported asfinancing activities. Vendor financing payments were$4,697 in 2022, compared to $4,596 in 2021. Capitalexpenditures in 2022 were $19,626, and when including$4,697 cash paid for vendor financing, capital investmentwas $24,323 ($4,182 higher than the prior year).',\n", " 'The vast majority of our capital expenditures are spent on\\nour networks, including product development and relatedsupport systems. In 2022, we placed $5,817 of equipmentin service under vendor financing arrangements(compared to $5,282 in 2021) and approximately $320 ofassets related to the FirstNet build (compared to $750 in2021). Total reimbursements from the government forFirstNet were approximately $260 for 2022 and $865 for2021.',\n", " 'The amount of our capital expenditures is influenced by\\ndemand for services and products, capacity needs andnetwork enhancements. Our capital expenditures andvendor financing payments were elevated in 2022,reflecting strategic investments. In 2023, we expect thatour capital investment, which includes capitalexpenditures and cash paid for vendor financing, will beconsistent with 2022 levels.Cash Used in or Provided by Financing Activities from\\nContinuing Operations\\nIn 2022, cash used in financing activities totaled $59,564\\nand was comprised of debt issuances and repayments,payments of dividends, and vendor financing payments.We\\nalso paid approximately $1,211 in cash on the note\\npayable to DIRECTV, with $130 due as of December 31,\\n2022 (see Note 19).\\nA tabular summary of our debt activity during 2022 is as follows:\\nFirst\\nQuarterSecond\\nQuarterThird\\nQuarterFourth\\nQuarterFull Year\\n2022\\nNet commercial paper borrowings $ 1,471 $ (5,219) $ (724) $ (1,337) $ (5,',\n", " '219) $ (724) $ (1,337) $ (5,809)\\nIssuance of Notes and Debentures:\\nPrivate Financing $ — $ — $ 750 $ — $ 7502025 Term Loan — — — 2,500 2,500Other 479 — — — 479\\nDebt Issuances $ 479 $ — $ 750 $ 2,500 $ 3,729Repayments:\\n2021 Syndicated Term Loan $ — $ (7,350) $ — $ — $ (7,350)BAML Bilateral Term Loan - Tranche A — (1,000) — — (1,000)Private financing — (750) — (750) (1,500)\\nRepayments of other short-term borrowings $ — $ (9,100) $ — $ (750) $ (9,850)\\nUSD notes\\n1, 2, 3$ (123) $ (18,957) $ — $ (287) $ (19,367)\\nEuro notes — (3,343) — — (3,343)BAML Bilateral Term Loan - Tranche B — (1,000) — — (1,',\n", " '000) — — (1,000)Other (667) (123) (199) (419) (1,408)\\nRepayments of long-term debt $ (790) $(23,423) $ (199) $ (706) $ (25,118)\\n1On April 11, 2022, we issued notices for the redemption in full of all of the outstanding approximately $9,042 aggregate principal amount of various gl obal notes due 2022\\nto 2026 with coupon rates ranging from 2.625% to 4.450% (Make-Whole Notes). The Make-Whole Notes were redeemed on the redemption dates set forth in the notices\\nof redemption, at “make whole” redemption prices calculated as set forth in the respective redemption notices in the second quarter.\\n2Includes $7,954 of cash paid toward the $8,822 aggregate principal amount of various notes that were tendered for cash in May 2022. The notes had intere st rates\\nranging between 3.100% and 8.750% and original maturities ranging from 2026 to 2061.',\n", " '3Includes $287 of principal repayment on a $592 zero coupon note that matured in November 2022. The other $305 was applied to operating cash flows relate d to interest\\nexpense that accreted to the note over its life.\\nThe weighted average interest rate of our long-term debtportfolio, including credit agreement borrowings and theimpact of derivatives, was approximately 4.1% as ofDecember 31, 2022 and 3.8% as of December 31, 2021. Wehad $133,207 of total notes and debentures outstanding atDecember 31, 2022, which included Euro, British poundsterling, Canadian dollar, Mexican peso, Australian dollar,and Swiss franc denominated debt that totaledapproximately $35,525.\\nAt December 31, 2022, we had $7,467 of debt maturing\\nwithin one year, consisting of $866 of commercial paperborrowings and $6,601 of long-term debt issuances.\\nDuring 2022, we paid $4,697 of cash under our vendor\\nfinancing program, compared to $4,596 in 2021.',\n", " 'Totalvendor financing payables included in our December 31,2022 consolidated balance sheet were $6,147, with $4,592due within one year (in “Accounts payable and accruedliabilities”) and the remainder predominantly due withinfive years (in “Other noncurrent liabilities”).At December 31, 2022, we had approximately 144 million\\nshares remaining from our share repurchaseauthorizations approved by the Board of Directors in 2014.During 2022, we repurchased approximately 34 millionshares under the March 2014 authorization.\\nWe paid dividends on common shares and preferred\\nshares of $9,859 in 2022, compared with $15,068 in 2021.Dividends on common stock declared by our Board ofDirectors, on a quarterly basis, totaled $1.11 per share in2022 and $2.08 per share in 2021. Our dividend policyconsiders the expectations and requirements ofstockholders, capital funding requirements of AT&T andlong-term growth opportunities.',\n", " 'On February 1, 2022, weannounced that our Board of Directors approved anexpected annual dividend level of $1.11 per common share,or approximately $8,000 per year, following the close ofthe WarnerMedia/Discovery transaction.\\nIn the fourth quarter of 2022, all outstanding AT&T\\nMobility II LLC (Mobility preferred interests) were put to us(approximately $8,000), with approximately one-thirdManagement’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts',\n", " 'redeemed in the fourth quarter; approximately 107 million\\ninterests are expected to be redeemed primarily inOctober 2023 and 107 million redeemed in October 2024,per the terms of the agreement, unless the interests arecalled or the puts are accepted by AT&T prior to thosedates. With the certainty of redemption, the remainingMobility preferred interests were reclassified from equityto a liability at fair value, with approximately $2,670recorded in current as “Accounts payable and accruedliabilities” and $2,670 recorded in “Other noncurrentliabilities.” In the fourth quarter of 2022, we paidapproximately $2,600 cash to redeem the Mobilitypreferred interests put to us on October 24, 2022. (SeeNote 16)\\nOur 2023 financing activities will focus on managing our\\ndebt level and paying dividends, subject to approval by ourBoard of Directors. We plan to fund our financing uses ofcash through a combination of cash from operations,issuance of debt, and asset sales. The timing and mix ofany debt issuance and/or refinancing will be guided bycredit market conditions and interest rate trends.',\n", " 'Credit Facilities\\nThe following summary of our various credit and loan\\nagreements does not purport to be complete and isqualified in its entirety by reference to each agreementfiled as exhibits to our Annual Report on Form 10-K.\\nWe use credit facilities as a tool in managing our liquidity\\nstatus. In November 2022, we terminated one of ourrevolving credit agreements and amended and restatedthe other. We currently have one $12,000 revolving creditagreement that terminates on November 18, 2027(Revolving Credit Agreement). No amounts wereoutstanding as of December 31, 2022.\\nOn January 29, 2021, we entered into a $14,700 Term Loan\\nCredit Agreement (2021 Syndicated Term Loan), with Bankof America, N.A., as agent. On March 23, 2021, we borrowed$7,350 under the 2021 Syndicated Term Loan and theremaining $7,350 of lenders’ commitments wereterminated. In the first quarter of 2022, the maturity dateof the 2021 Syndicated Term Loan was extended toDecember 31, 2022.',\n", " 'On April 13, 2022, the 2021 SyndicatedTerm Loan was paid off and terminated.\\nIn March 2021, we entered into and drew on a $2,000 term\\nloan credit agreement (BAML Bilateral Term Loan)consisting of (i) a $1,000 facility originally due December31, 2021 (BAML Tranche A Facility) and subsequentlyextended to December 31, 2022 in the fourth quarter of2021, and (ii) a $1,000 facility due December 31, 2022 (BAMLTranche B Facility), with Bank of America, N.A., as agent.On April 13, 2022, the BAML Bilateral Term Loan was paidoff and terminated.\\nIn November 2022, we entered into and drew on a $2,500\\nterm loan agreement due February 16, 2025 (2025 TermLoan), with Mizuho Bank, Ltd., as agent. As of December 31,2022, $2,500 was outstanding under this agreement.We also utilize other external financing sources, which\\ninclude various credit arrangements supported bygovernment agencies to support network equipmentpurchases as well as a commercial paper program.',\n", " 'Each of our credit and loan agreements contains\\ncovenants that are customary for an issuer with aninvestment grade senior debt credit rating. Our RevolvingCredit Agreement and 2025 Term Loan include a net debt-to-EBITDA financial ratio covenant requiring AT&T tomaintain, as of the last day of each fiscal quarter, a ratio ofnot more than 3.75-to-1. Other loan agreements include anet debt-to-EBITDA financial ratio covenant requiringAT&T to maintain, as of the last day of each fiscal quarterthrough June 30, 2023 a ratio of not more than 4.0-to-1,and a ratio of not more than 3.5-to-1 for any fiscal quarterthereafter. As of December 31, 2022, we were incompliance with the covenants for our credit facilities.\\nCollateral Arrangements\\nMost of our counterparty collateral arrangements require\\ncash collateral posting by AT&T only when derivativemarket values exceed certain thresholds. Under thesearrangements, which cover the majority of ourapproximately $38,800 derivative portfolio,counterparties are still required to post collateral.',\n", " 'During2022, we posted approximately $760 of cash collateral, ona net basis. Cash postings under these arrangements varywith changes in credit ratings and netting agreements.(See Note 12)\\nOther\\nOur total capital consists of debt (long-term debt and\\ndebt maturing within one year) and stockholders’ equity.Our capital structure does not include debt issued by ourequity method investments. At December 31, 2022, ourdebt ratio was 56.1%, compared to 48.9% at December 31,2021 and 46.4% at December 31, 2020. The debt ratio isaffected by the same factors that affect total capital, andreflects our recent debt issuances, repayments andreclassifications related to redemption of noncontrollinginterests.\\n .',\n", " 'A significant amount of our cash outflows for continuing\\noperations is related to tax items, acquisition of spectrumthrough FCC auctions and benefits paid for current andformer employees:\\n• Total taxes incurred, collected and remitted by AT&T\\nduring 2022 and 2021, were $16,630 and $17,119. Thesetaxes include income, franchise, property, sales,excise, payroll, gross receipts and various other taxesand fees.\\n• Total domestic spectrum acquired primarily through\\nFCC auctions, including cash, exchanged spectrumand auction deposits was approximately $10,200 in2022, $25,400 in 2021 and $2,800 in 2020.• Total health and welfare benefits provided to certain\\nactive and retired employees and their dependentstotaled approximately $3,200 in 2022 and $3,390 in2021, with $788 paid from plan assets in 2022compared to $1,163 in 2021. Of those benefits,approximately $2,840 related to medical andprescription drug benefits in 2022 compared to $2,990in 2021.',\n", " 'In addition, in 2022, we prefunded $500 forfuture benefit payments versus $685 in 2021. We paid$5,854 of pension benefits out of plan assets in 2022compared to $5,942 in 2021.\\nContractual Obligations\\nOur contractual obligations as of December 31, 2022, and the estimated timing of payment, are in the following table:\\nPayments Due By Period\\nTotalLess than\\n1 Year1-3\\nYears3-5\\nYearsMore than 5\\nYears\\nLong-term debt obligations1$ 147,673 $ 6,929 $ 14,898 $ 14,897 $ 110,949\\nInterest payments on long-term debt2101,559 6,062 10,910 9,818 74,769\\nPurchase obligations327,015 12,313 11,424 2,457 821\\nOperating lease obligations426,468 4,657 7,746 5,132 8,933\\nFirstNet sustainability payments517,205 195 390 3,255 13,365\\nUnrecognized tax benefits68,323 486 — — 7,',\n", " '255 13,365\\nUnrecognized tax benefits68,323 486 — — 7,837\\nOther finance obligations713,788 5,391 2,830 1,787 3,780\\nMobility preferred interests85,340 2,670 2,670 — —\\nTotal Contractual Obligations $ 347,371 $ 38,703 $ 50,868 $ 37,346 $ 220,454\\n1Represents principal or payoff amounts of notes, debentures and credit agreement borrowings at maturity (see Note 11). Foreign debt includes the imp act from hedges,\\nwhen applicable.\\n2Includes credit agreement borrowings.\\n3We expect to fund the purchase obligations with cash provided by operations or through incremental borrowings. Consists of commitments primarily re lated to\\nspectrum acquisitions and other commercial commitments. The minimum commitment for certain obligations is based on termination penalties that cou ld be paid to\\nexit the contracts. (See Note 21)\\n4Represents operating lease payments (see Note 8).\\n5Represents contractual commitment to make sustainability payments over the 25-year contract.',\n", " '5Represents contractual commitment to make sustainability payments over the 25-year contract. These sustainability payments represent our commit ment to fund\\nFirstNet’s operating expenses and future reinvestment in the network, which we own and operate. FirstNet has a statutory requirement to reinvest fun ds that exceed\\nthe agency’s operating expenses, which we anticipate to be $15,000. (See Note 20)\\n6The noncurrent portion of the UTBs is included in the “More than 5 Years” column, as we cannot reasonably estimate the timing or amounts of additional ca sh payments,\\nif any, at this time (see Note 13).\\n7Represents future minimum payments under the Crown Castle and other arrangements (see Note 18), payables subject to extended payment terms (see Note 22),\\nfinance lease payments (see Note 8) and note payable to DIRECTV (see Note 19).\\n8See Note 16.',\n", " '8See Note 16.\\nCertain items were excluded from this table because the year of payment is unknown and could not be reliably\\nestimated, we believe the obligations are immaterial, or the settlement of the obligation will not require the use of cash.These items include: deferred income tax liability of $57,032 (see Note 13); net postemployment benefit obligations of$8,433 (including current portion); and other noncurrent liabilities of $11,035.Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n :',\n", " 'MARKET RISK\\nWe are exposed to market risks primarily from changes in\\ninterest rates and foreign currency exchange rates. Theserisks, along with other business risks, impact our cost ofcapital. It is our policy to manage our debt structure andforeign exchange exposure in order to manage capitalcosts, control financial risks and maintain financialflexibility over the long term. In managing market risks, weemploy derivatives according to documented policies andprocedures, including interest rate swaps, interest ratelocks, foreign currency exchange contracts and combinedinterest rate foreign currency contracts (cross-currencyswaps). We do not use derivatives for trading orspeculative purposes. We do not foresee significantchanges in the strategies we use to manage market risk inthe near future.\\nOne of the most significant assumptions used in\\nestimating our postretirement benefit obligations is theassumed weighted-average discount rate, which is thehypothetical rate at which the projected benefitobligations could be effectively settled or paid out toparticipants.',\n", " 'We determined our discount rate based on arange of factors, including a yield curve composed of therates of return on several hundred high-quality, fixedincome corporate bonds available at the measurementdate and corresponding to the related expected durationsof future cash outflows for the obligations. In recentyears, the discount rates have been increasingly volatile,and on average have been lower than in historical periods.Lower discount rates used to measure our pension andpostretirement plans result in higher obligations. Futureincreases in these rates could result in lower obligations,improved funded status and actuarial gains.\\nInterest Rate Risk\\nThe majority of our financial instruments are medium-\\nand long-term fixed-rate notes and debentures. Changesin interest rates can lead to significant fluctuations in thefair value of these instruments. The principal amounts byexpected maturity, average interest rate and fair value ofour liabilities that are exposed to interest rate risk aredescribed in Notes 11 and 12. In managing interestexpense, we control our mix of fixed and floating ratedebt through term loans, floating rate notes, and interestrate swaps.',\n", " 'We have established interest rate risk limitsthat we closely monitor by measuring interest ratesensitivities in our debt and interest rate derivativesportfolios.Most of our foreign-denominated long-term debt has\\nbeen swapped from fixed-rate or floating-rate foreigncurrencies to fixed-rate U.S. dollars at issuance throughcross-currency swaps, removing interest rate risk andforeign currency exchange risk associated with theunderlying interest and principal payments. Likewise,periodically we enter into interest rate locks to partiallyhedge the risk of increases in the benchmark interest rateduring the period leading up to the probable issuance offixed-rate debt. We expect gains or losses in our cross-currency swaps and interest rate locks to offset the lossesand gains in the financial instruments they hedge.\\nWe had no interest rate swaps and no interest rate locks\\nat December 31, 2022.\\nForeign Exchange Risk\\nWe principally use foreign exchange contracts to hedge\\ncosts and debt denominated in foreign currencies. We arealso exposed to foreign currency exchange risk throughour foreign affiliates and equity investments in foreigncompanies.\\nThrough cross-currency swaps, most of our foreign-\\ndenominated debt has been swapped from fixed-rate orfloating-rate foreign currencies to fixed-rate U.S.',\n", " 'dollarsat issuance, removing interest rate and foreign currencyexchange risk associated with the underlying interest andprincipal payments. We expect gains or losses in ourcross-currency swaps to offset the gains and losses in thefinancial instruments they hedge. We had cross-currencyswaps with a notional value of $38,213 and a fair value of$(5,982) outstanding at December 31, 2022.\\nFor the purpose of assessing specific risks, we use a\\nsensitivity analysis to determine the effects that marketrisk exposures may have on the fair value of our financialinstruments and results of operations. We had foreignexchange forward contracts with a notional value of $617and a fair value of $(23) outstanding at December 31, 2022.\\n ,',\n", " 'STOCK PERFORMANCE GRAPH\\nComparison of Five Year Cumulative Return\\nAT&T Inc., S&P 500 Index and S&P 500 Communication Services Index\\nThe comparison above assumes $100 invested on December 31, 2017, in AT&T common stock and the following Standard\\n& Poor’s (S&P) Indices: S&P 500 Index and S&P 500 Communication Services Index. Total return equals stock priceappreciation plus reinvestment of dividends.Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n ;100\\n78113\\n8210096126191\\n157\\n100\\n87116143174\\n105AT&T Inc. S&P 500 Index S&P 500 Communication Services Index\\n12/17 12/18 12/19 12/20 12/21 12/226080100120140160180200\\n8987914',\n", " 'RISK FACTORS\\nIn addition to the other information set forth in this\\ndocument, including the matters contained under thecaption “Cautionary Language Concerning Forward-Looking Statements,” you should carefully read thematters described below. We believe that each of thesematters could materially affect our business. Werecognize that most of these factors are beyond ourability to control and therefore we cannot predict anoutcome.\\nMacro-economic Factors:Adverse changes in the U.S. securities markets,\\ninterest rates, rising inflation and medical costs couldmaterially increase our benefit plan costs and futurefunding requirements.\\nOur costs to provide current benefits and funding for\\nfuture benefits are subject to increases, primarily due tocontinuing increases in medical and prescription drugcosts, in part due to inflation, and can be affected by lowerreturns on assets held by our pension and other benefitplans, which are reflected in our financial statements forthat year.',\n", " 'In calculating the recognized benefit costs, wehave made certain assumptions regarding futureinvestment returns, interest rates and medical costs.These assumptions could change significantly over timeand could be materially different than originally projected.Lower than assumed investment returns, an increase inour benefit obligations, and higher than assumed medicaland prescription drug costs will increase expenses.\\nThe Financial Accounting Standards Board (FASB) requires\\ncompanies to recognize the funded status of definedbenefit pension and postretirement plans as an asset orliability in their statement of financial position and torecognize changes in that funded status in the year inwhich the changes occur. We have elected to reflect theannual adjustments to the funded status in ourconsolidated statement of income. Therefore, an increasein our costs or adverse market conditions will have anegative effect on our operating results.\\nSignificant adverse changes in capital markets could\\nresult in the deterioration of our defined benefit plans’funded status.\\nInflationary pressures on costs, such as inputs for\\ndevices we sell and network components, labor anddistribution costs may impact our networkconstruction, our financial condition or results ofoperations.',\n", " 'As a provider of telecommunications and technology\\nservices, we sell handsets, wireless data cards, wirelesscomputing devices and customer premises equipmentmanufactured by various suppliers for use with our voiceand data services and depend on suppliers to provide us,directly or through other suppliers, with items such asnetwork equipment, customer premises equipment, andwireless-related equipment such as mobile hotspots,handsets, wirelessly enabled computers, wireless datacards and other connected devices for our customers.Beginning in 2021 and continuing through the early part of\\n2023, the costs of these inputs and the costs of labornecessary to develop, deploy and maintain our networksand our products and services rapidly increased. Inaddition, many of these inputs are subject to pricefluctuations from a number of factors, including, but notlimited to, market conditions, demand for raw materialsused in the production of these devices and networkcomponents, weather, climate change, energy costs,currency fluctuations, supplier capacities, governmentalactions, import and export requirements (includingtariffs), and other factors beyond our control. Inflationaryand supply pressures may continue into the future andcould have an adverse impact on our ability to sourcematerials.',\n", " 'Our attempts to offset these cost pressures, such as\\nthrough increases in the selling prices of some of ourproducts and services, may not be successful. Higherproduct prices may result in reductions in sales volume.Consumers may be less willing to pay a price differentialfor our products and may increasingly purchase lower-priced offerings, or may forego some purchasesaltogether, during a period of inflationary pressure or aneconomic downturn. To the extent that price increasesare not sufficient to offset these increased costsadequately or in a timely manner, and/or if they result insignificant decreases in sales volume, our business,financial condition or operating results may be adverselyaffected. Furthermore, we may not be able to offset anycost increases through productivity and cost-savinginitiatives.\\nAdverse changes in global financial markets could limit\\nour ability and our larger customers’ ability to accesscapital or increase the cost of capital needed to fundbusiness operations.',\n", " 'During 2022, uncertainty surrounding global growth rates,\\ninflation, an increasing interest rate environment and theimpact of the COVID-19 pandemic continued to producevolatility in the credit, currency and equity markets.Volatility may affect companies’ access to the creditmarkets, leading to higher borrowing costs, or, in somecases, the inability to fund ongoing operations. In addition,we contract with large financial institutions to support ourown treasury operations, including contracts to hedge ourexposure on interest rates and foreign exchange and thefunding of credit lines and other short-term debtobligations, including commercial paper. These financialinstitutions face stricter capital-related and otherregulations in the United States and Europe, as well asongoing legal and financial issues concerning their loanportfolios, which may hamper their ability to providecredit or raise the cost of providing such credit.\\nThe U.K. Financial Conduct Authority, which regulates the\\nLondon Interbank Offering Rate (LIBOR), has announcedthat it intends to phase out LIBOR in 2023. Although oursecurities and other debt obligations may provide foralternative methods of calculating the interest rate\\n ?',\n", " 'payable on such indebtedness, uncertainty as to the\\nextent and manner of future changes may adverselyaffect the current trading market for LIBOR-basedsecurities and the value of variable rate indebtedness ingeneral. A company’s cost of borrowing is also affected byevaluations given by various credit rating agencies andthese agencies have been applying tighter creditstandards when evaluating debt levels and future growthprospects. While we have been successful in continuing toaccess the credit and fixed income markets when needed,adverse changes in the financial markets could render useither unable to access these markets or able to accessthese markets only at higher interest costs and withrestrictive financial or other conditions, severely affectingour business operations. Additionally, downgrades of ourcredit rating by the major credit rating agencies couldincrease our cost of borrowing and also impact thecollateral we would be required to post under certainagreements we have entered into with our derivativecounterparties, which could negatively impact ourliquidity. Further, valuation changes in our derivativeportfolio due to interest rates and foreign exchange ratescould require us to post collateral and thus may negativelyimpact our liquidity.',\n", " 'Our international operations increase our exposure to\\npolitical instability, to changes in the internationaleconomy and to regulation on our business and theserisks could offset our expected growth opportunities.\\nWe have international operations, particularly in Mexico,\\nand other countries worldwide where we need to complywith a wide variety of complex local laws, regulations andtreaties. In addition, we are exposed to, among otherfactors, fluctuations in currency values, changes inrelationships between U.S. and foreign governments, waror other hostilities, and other regulations that maymaterially affect our earnings. Involvement with foreignfirms also exposes us to the risk of being unable to controlthe actions of those firms and therefore exposes us torisks associated with our obligation to comply with theForeign Corrupt Practices Act (FCPA). Violations of theFCPA could have a material adverse effect on ouroperating results.\\nIndustry-wide Factors:\\nOur business is subject to risks related to the COVID-19\\nvirus.\\nThe COVID-19 pandemic and resulting mitigation\\nmeasures have caused, and may continue to cause, anegative effect on our operating results.',\n", " 'These effectsinclude, but are not limited to closure of retail stores;impact on our customers’ ability to pay for our productsand services; reduction in international roaming revenue;and reduced staffing levels in call centers and fieldoperations. We may also incur significantly higherexpenses attributable to infrastructure investmentsrequired to meet higher network utilization from morecustomers consuming bandwidth from changes in workfrom home trends; extended cancellation periods; andincreased labor costs if the COVID-19 pandemic continues\\nfor an extended period.\\nThe COVID-19 pandemic and mitigation measures have\\ncaused, and may continue to cause, adverse impacts onglobal supply chains and economic conditions. Theseimpacts could affect our network development,deployment and maintenance, and the demand for ourproducts and services. The extent to which the COVID-19pandemic impacts our business, results of operations,cash flows and financial condition will depend on futuredevelopments that are highly uncertain and cannot bepredicted, including new information that may emergeconcerning other strains of the virus and the actions tocontain its impact.',\n", " 'Changes to federal, state and foreign government\\nregulations and decisions in regulatory proceedings, aswell as private litigation, could further increase ouroperating costs and/or alter customer perceptions ofour operations, which could materially adverselyaffect us.\\nOur subsidiaries providing wired services are subject to\\nsignificant federal and state regulation while many of ourcompetitors are not. In addition, our subsidiaries andaffiliates operating outside the United States are alsosubject to the jurisdiction of national and supranationalregulatory authorities in the market where service isprovided. Our wireless subsidiaries are regulated tovarying degrees by the FCC and in some instances, bystate and local agencies. Adverse regulations and rulingsby the FCC relating to broadband and wirelessdeployment could impede our ability to manage ournetworks and recover costs and lessen incentives toinvest in our networks. The continuing growth of IP-basedservices, especially when accessed by wireless devices, hascreated or potentially could create conflicting regulationbetween the FCC and various state and local authorities,which may involve lengthy litigation to resolve and mayresult in outcomes unfavorable to us.',\n", " 'In addition, inresponse to the FAA questioning whether our 5G C-bandlaunch could impact radio altimeter equipment onairplanes, we voluntarily committed to a series oftemporary, precautionary measures, in addition todeferring turning on a limited number of towers aroundcertain airports to allow the FAA more time to evaluate.These measures have been subsequently modified fromtime to time. The FAA’s continued evaluation may impactour planned 5G C-band launch in certain areas. In addition,increased public focus on a variety of issues related to ouroperations, such as privacy issues, government requestsor orders for customer data, and concerns about globalclimate changes, have led to proposals or new legislationat state, federal and foreign government levels to changeor increase regulation on our operations. Enactment ofnew privacy laws and regulations could, among otherthings, adversely affect our ability to collect and offertargeted advertisements or result in additional costs ofManagement’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n !',\n", " 'compliance or litigation. Should customers decide that\\nour competitors offer a more customer-friendlyenvironment, our competitive position, results ofoperations or financial condition could be materiallyadversely affected.\\nEffects of climate change may impose risk of damage\\nto our infrastructure, our ability to provide services,and may cause changes in federal, state and foreigngovernment regulation, all of which may result inpotential adverse impact to our financial results.\\nExtreme weather events precipitated by long-term\\nclimate change have the potential to directly damagenetwork facilities or disrupt our ability to build andmaintain portions of our network and could potentiallydisrupt suppliers’ ability to provide products and servicesrequired to provide reliable network coverage. Any suchdisruption could delay network deployment plans,interrupt service for our customers, increase our costsand have a negative effect on our operating results. Thepotential physical effects of climate change, such asincreased frequency and severity of storms, floods, fires,freezing conditions, sea-level rise and other climate-related events, could adversely affect our operations,infrastructure and financial results. Operational impactsresulting from the potential physical effects of climatechange, such as damage to our network infrastructure,could result in increased costs and loss of revenue.',\n", " 'Wecould incur significant costs to improve the climateresiliency of our infrastructure and otherwise prepare for,respond to, and mitigate such physical effects of climatechange. We are not able to accurately predict themateriality of any potential losses or costs associatedwith the physical effects of climate change.\\nFurther, customers, consumers, investors and other\\nstakeholders are increasingly focusing on environmentalissues, including climate change, water use, deforestation,plastic waste and other sustainability concerns. Concernover climate change or other environmental, social andgovernance (ESG) matters may result in new or increasedlegal and regulatory requirements to reduce or mitigateimpacts to the environment and reduce the impact of ourbusiness on climate change. Further, climate changeregulations may require us to alter our proposed businessplans or increase our operating costs due to increasedregulation or environmental considerations, and couldadversely affect our business and reputation.\\nContinuing growth in and the converging nature of\\nwireless and broadband services will require us todeploy significant amounts of capital and requireongoing access to spectrum in order to provideattractive services to customers.',\n", " 'Wireless and broadband services are undergoing rapid and\\nsignificant technological changes and a dramatic increasein usage, including, in particular, the demand for faster andseamless usage of data, including video, across mobile andfixed devices. The COVID-19 pandemic has acceleratedthese changes and also resulted in higher networkutilization, as more customers consume bandwidth fromchanges in work and learn from home trends. We must\\ncontinually invest in our networks in order to improve ourwireless and broadband services to meet this increasingdemand and changes in customer expectations whileremaining competitive. Improvements in these servicesdepend on many factors, including continued access toand deployment of adequate spectrum and the capitalneeded to expand our wireline network to supporttransport of these services. In order to stem broadbandsubscriber losses to cable competitors in our non-fiberwireline areas, we have been expanding our all-fiberwireline network. We must maintain and expand ournetwork capacity and coverage for transport of data,including video, and voice between cell and fixed landlinesites. To this end, we participate in spectrum auctions andcontinue to deploy software and other technologyadvancements in order to efficiently invest in ournetwork.',\n", " 'We have spent, and plan to continue spending, significant\\ncapital and other resources on the ongoing developmentand deployment of our 5G and fiber wireline networks.This deployment and other network serviceenhancements and product launches may not occur asscheduled or at the cost expected due to many factors,including unexpected inflation, delays in determiningequipment and wireless handset operating standards,supplier delays, software issues, increases in network andhandset component costs, regulatory permitting delaysfor tower sites or enhancements, or labor-related delays.Deployment of new technology also may adversely affectthe performance of the network for existing services. Ifwe cannot acquire needed spectrum, our 5G and fiberofferings fail to gain acceptance in the marketplace or weotherwise fail to deploy the services customers desire ona timely basis with acceptable quality and at reasonablecosts, then our ability to attract and retain customers,and, therefore, maintain and improve our operatingmargins, could be materially adversely affected.\\nIncreasing competition for wireless customers could\\nmaterially adversely affect our operating results.\\nWe have multiple wireless competitors in each of our\\nservice areas and compete for customers basedprincipally on service/device offerings, price, networkquality, coverage area and customer service.',\n", " 'In addition,we are facing growing competition from providersoffering services using advanced wireless technologiesand IP-based networks. We expect market saturation tocontinue to cause the wireless industry’s customergrowth rate to moderate in comparison with historicalgrowth rates, leading to increased competition forcustomers. Our share of industry sales could be reduceddue to aggressive pricing or promotional strategiespursued by competitors. We also expect that ourcustomers’ growing demand for high-speed video anddata services will place constraints on our networkcapacity. These competition and capacity constraints willcontinue to put pressure on pricing and margins ascompanies compete for potential customers. Our abilityto respond will depend, among other things, on continued\\n ¿',\n", " 'improvement in network quality and customer service and\\nour ability to price our products and servicescompetitively as well as effective marketing of attractiveproducts and services. These efforts will involvesignificant expenses and require strategic managementdecisions on, and timely implementation of, equipmentchoices, network deployment and service offerings.\\nIntellectual property rights may be inadequate to take\\nadvantage of business opportunities, which maymaterially adversely affect our operations.\\nEffective intellectual property protection may not be\\navailable in every country where we operate. We mayneed to spend significant amounts of money to protectour rights. Any impairment of our intellectual propertyrights, including due to changes in U.S. or foreignintellectual property laws or the absence of effective legalprotections or enforcement measures, could materiallyadversely impact our operations.\\nIncidents leading to damage to our reputation, and any\\nresulting lawsuits, claims or other legal proceedings,could have a material adverse effect on our business.',\n", " 'We believe that our brand image, awareness and\\nreputation strengthen our relationship with consumersand contribute significantly to the success of our business.We strive to create a culture in which our colleagues actwith integrity and respect and feel comfortable speakingup to report instances of misconduct or other concerns.Our ability to attract and retain employees is highlydependent upon our commitment to a diverse andinclusive workplace, ethical business practices and otherqualities. Acts of misconduct by any employee, andparticularly by senior management, could erode trust andconfidence and damage our reputation. Negative publicopinion could result from actual or alleged conduct by usor those currently or formerly associated with us, andfrom any number of activities or circumstances, includingoperations, employment-related offenses (such as sexualharassment and discrimination), regulatory complianceand actions taken by regulators or others in response tosuch conduct. Any damage to our reputation or paymentsof significant amounts, even if reserved, could materiallyand adversely affect our business, reputation, financialcondition, results of operations and cash flows. Wecurrently are, and may in the future be, named as adefendant in lawsuits, claims and other legal proceedingsthat arise in the ordinary course of our business based onalleged acts of misconduct by employees.',\n", " 'These actionsseek, among other things, compensation for allegedpersonal injury (including claims for loss of life), workers’compensation, employment discrimination, sexualharassment, workplace misconduct, wage and hour claimsand other employment-related damages, compensationfor breach of contract, statutory or regulatory claims,negligence or gross negligence, punitive damages,consequential damages, and civil penalties or other lossesor injunctive or declaratory relief. The outcome of anyallegations, lawsuits, claims or legal proceedings isinherently uncertain and could result in significant costs,damage to our brands or reputation and diversion ofmanagement’s attention from our business.Company-Specific Financial Factors:\\nCustomer adoption of new software-based\\ntechnologies may require higher quality services fromus, and meeting these demands could create supplychain issues and could increase capital costs.\\nThe communications industry has experienced rapid\\nchanges in the past several years. An increasing numberof our customers are using mobile devices as theirprimary means of viewing video.',\n", " 'An increasing numberof our customers are using mobile devices as theirprimary means of viewing video. In addition, businessesand government bodies are broadly shifting to wireless-based services for homes and infrastructure to improveservices to their respective customers and constituencies.We have spent, and continue to spend, significant capitalto shift our wired network to software-based technologyto manage this demand and are expanding 5G wirelesstechnology to address these consumer demands. We areentering into a significant number of software licensingagreements and working with software developers toprovide network functions in lieu of installing switches orother physical network equipment in order to respond torapid developments in wireless demand. While software-based functionality can be changed much more quicklythan, for example, physical switches, the rapid pace ofdevelopment means that we may increasingly need to relyon single-source and software solutions that have notpreviously been deployed in production environments.Should this software not function as intended or ourlicense agreements provide inadequate protection fromintellectual property infringement claims, we could beforced to either substitute (if available) or else spend timeto develop alternative technologies at a much higher costand incur harm to our reputation for reliability, and, as aresult, our ability to remain competitive could bematerially adversely affected.',\n", " 'We depend on various suppliers to provide equipment\\nto operate our business and satisfy customer demandand interruption or delay in supply can adverselyimpact our operating results.\\nWe depend on suppliers to provide us, directly or through\\nother suppliers, with items such as network equipment,customer premises equipment and wireless-relatedequipment such as mobile hotspots, handsets, wirelesslyenabled computers, wireless data cards and otherconnected devices for our customers. These supplierscould fail to provide equipment on a timely or costeffective basis, or fail to meet our performanceexpectations, for a number of reasons, includingdifficulties in obtaining export licenses for certaintechnologies, inflationary pressures, inability to securecomponent parts, general business disruption, naturaldisasters, safety issues, economic and political instability,including the outbreak of war and other hostilities, andpublic health emergencies such as the COVID-19pandemic. These factors have caused, and may againcause, delays in the development, manufacturing(including the sourcing of key components) and shipmentof products to the extent that we or our suppliers areimpacted. In certain limited circumstances, suppliers haveManagement’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n.\\x08',\n", " 'been unable to supply products in a timely fashion,\\naffecting our ability to provide products and servicesprecisely as and when requested by our customers. It ispossible that, in some circumstances, we could be forcedto switch to a different key supplier or be unable to meetcustomer demand for certain products or services.Because of the cost and time lag that can be associatedwith transitioning from one supplier to another, ourbusiness could be substantially disrupted if we wererequired to, or chose to, replace the products of one ormore key suppliers with products from another source,especially if the replacement became necessary on shortnotice. Any such disruption could increase our costs,decrease our operating efficiencies and have a negativeeffect on our operating results.\\nIncreasing costs to provide services and failure to\\nrenew agreements on favorable terms, or at all, couldadversely affect operating margins.\\nOur operating costs, including customer acquisition and\\nretention costs, could continue to put pressure onmargins and customer retention levels.\\nA number of our competitors offering comparable legacy\\nservices that rely on alternative technologies and businessmodels are typically subject to less regulation, andtherefore are able to operate with lower costs.',\n", " 'Thesecompetitors generally can focus on discrete customersegments since they do not have regulatory obligations toprovide universal service. Also, these competitors havecost advantages compared to us, due in part to operatingon newer, more technically advanced and lower-costnetworks with a nonunionized workforce, lower employeebenefits and fewer retirees. We are transitioning servicesfrom our old copper-based network and seekingregulatory approvals, where needed, at both the state andfederal levels. If we do not obtain regulatory approvals forour network transition or obtain approvals with onerousconditions, we could experience significant cost andcompetitive disadvantages.\\nWe may not realize or sustain the expected benefits\\nfrom our business transformation initiatives and theseefforts could have a materially adverse effect on ourbusiness, operations, financial condition, results ofoperations and competitive position.\\nWe have been and will be undertaking certain\\ntransformation initiatives, including the WarnerMedia/Discovery Transaction, which are designed to reducecosts, streamline and modernize distribution andcustomer service, remove redundancies and simplify andimprove processes and support functions. Our focus is onsupporting added customer value with an improvedcustomer experience.',\n", " 'Our focus is onsupporting added customer value with an improvedcustomer experience. We intend for these efficiencies toenable increased investments in our strategic areas offocus, which consist of improving broadband connectivity(for example, fiber and 5G). We also expect theseinitiatives to drive efficiencies and improved margins. If wedo not successfully manage and execute these initiatives,or if they are inadequate or ineffective, we may fail tomeet our financial goals and achieve anticipated benefits,\\nimprovements may be delayed, not sustained or notrealized, and our business, operations and competitiveposition could be adversely affected.\\nUnfavorable litigation or governmental investigation\\nresults could require us to pay significant amounts orlead to onerous operating procedures.\\nWe are subject to a number of lawsuits both in the United\\nStates and in foreign countries, including, at any particulartime, claims relating to antitrust, patent infringement,wage and hour, personal injury, customer privacyviolations, regulatory proceedings, breach of contract, andselling and collection practices. We also spend substantialresources complying with various government standards,which may entail related investigations and litigation.',\n", " 'We also spend substantialresources complying with various government standards,which may entail related investigations and litigation. Inthe wireless area, we also face current and potentiallitigation relating to alleged adverse health effects oncustomers or employees who use such technologiesincluding, for example, wireless devices. We may incursignificant expenses defending such suits or governmentcharges and may be required to pay amounts orotherwise change our operations in ways that couldmaterially adversely affect our operations or financialresults.\\nCyberattacks impacting our networks or systems may\\nhave a material adverse affect on our operations.\\nCyberattacks, including through the use of malware,\\ncomputer viruses, distributed denial of services attacks,ransomware attacks, credential harvesting, socialengineering and other means for obtaining unauthorizedaccess to or disrupting the operation of our networks andsystems and those of our suppliers, vendors and otherservice providers, could have a material adverse effect onour operations. Cyberattacks can cause equipment ornetwork failures, loss of information, including sensitivepersonal information of customers or employees orproprietary information, as well as disruptions to our orour customers’, suppliers’ or vendors’ operations, whichcould result in significant expenses, potentialinvestigations and legal liability, a loss of current or futurecustomers and reputational damage.',\n", " 'Our wired networkin particular is becoming increasingly reliant on softwareas it evolves to handle growing demands for videotransmission. Cyberattacks against companies, includingthe Company and its suppliers and vendors, have occurredand will continue to occur and have increased infrequency, scope and potential harm in recent years. Thedevelopment and maintenance of systems to preventsuch attacks is costly and requires ongoing monitoringand updating. While, to date, we have not been subject tocyberattacks that, individually or in the aggregate, havebeen material to our operations or financial condition, thepreventive actions we take to reduce the risks associatedwith cyberattacks may be insufficient to repel or mitigatethe effects of a major cyberattack in the future.\\n.',\n", " 'Natural disasters, extreme weather conditions or\\nterrorist or other hostile acts could cause damage toour infrastructure and result in significant disruptionsto our operations.\\nOur business operations could be subject to interruption\\nby equipment failures, power outages, terrorist or otherhostile acts, and natural disasters, such as flooding,hurricanes and forest fires, whether caused by discretesevere weather events and/or precipitated by long-termclimate change. Such events could cause significantdamage to the infrastructure upon which our businessoperations rely, resulting in degradation or disruption ofservice to our customers, as well as significant recoverytime and expenditures to resume operations. Our systemredundancy and other measures we take to protect ourinfrastructure and operations from the impacts of suchevents may be ineffective or inadequate to sustain ouroperations through all such events. Any of theseoccurrences could result in lost revenues from businessinterruption, damage to our reputation and reducedprofits.\\nIncreases in our debt levels to fund spectrum\\npurchases, or other strategic decisions could adverselyaffect our ability to finance future debt at attractiverates and reduce our ability to respond to competitionand adverse economic trends.',\n", " 'We have incurred debt to fund significant acquisitions, as\\nwell as spectrum purchases needed to compete in ourindustry. While we believe such decisions were prudentand necessary to take advantage of both growthopportunities and respond to industry developments, wedid experience credit-rating downgrades from historicallevels. Banks and potential purchasers of our publiclytraded debt may decide that these strategic decisions andsimilar actions we may take in the future, as well asexpected trends in the industry, will continue to increasethe risk of investing in our debt and may demand a higherrate of interest, impose restrictive covenants or otherwiselimit the amount of potential borrowing. Additionally, ourcapital allocation plan is focused on, among other things,managing our debt level going forward. Any failure tosuccessfully execute this plan could adversely affect ourcost of funds, liquidity, competitive position and access tocapital markets.\\nOur business may be impacted by changes in tax laws\\nand regulations, judicial interpretations of the same oradministrative actions by federal, state, local andforeign taxing authorities.\\nTax laws are dynamic and subject to change as new laws\\nare passed and new interpretations of the law are issuedor applied.',\n", " 'In many cases, the application of existing,newly enacted or amended tax laws (such as the U.S. TaxCuts and Jobs Act of 2017 and the Inflation Reduction Actof 2022) may be uncertain and subject to differinginterpretations, especially when evaluated against everchanging products and services provided by our global\\ntelecommunications and technology businesses. Inaddition, tax legislation has been introduced or is beingconsidered in various jurisdictions that could significantlyimpact our tax rate, tax liabilities, and carrying value ofdeferred tax assets or deferred tax liabilities. Any of thesechanges could materially impact our financialperformance and our tax provision, net income and cashflows.\\nWe are also subject to ongoing examinations by taxing\\nauthorities in various jurisdictions. Although we regularlyassess the likelihood of an adverse outcome resultingfrom these examinations to determine the adequacy ofprovisions for taxes, there can be no assurance as to theoutcome of these examinations.',\n", " 'In the event that we havenot accurately or fully described, disclosed or determined,calculated or remitted amounts that were due to taxingauthorities or if the ultimate determination of our taxesowed is for an amount in excess of amounts previouslyaccrued, we could be subject to additional taxes, penaltiesand interest, which could materially impact our business,financial condition and operating results.\\nIf the distribution of WarnerMedia, together with\\ncertain related transactions, were to fail to qualify fornon-recognition treatment for U.S. federal income taxpurposes under audit, then we could be subject tosignificant tax liability.\\nIn connection with the WarnerMedia/Discovery\\nTransaction, AT&T received a favorable Private LetterRuling from the IRS. Nonetheless, the IRS or anotherapplicable tax authority could determine on audit that thedistribution by us of WarnerMedia to our stockholders andcertain related transactions should be treated as taxabletransactions if it determines that any of the facts,representations or undertakings made in connection withthe request for the ruling were incorrect or are violated.We may be entitled to indemnification from Warner Bros.Discovery (Warner Bros.) in the case of certain breaches ofrepresentations or undertakings by Warner Bros.',\n", " 'in the case of certain breaches ofrepresentations or undertakings by Warner Bros. underthe tax matters agreement related to the WarnerMedia/Discovery Transaction. However, we could potentially berequired to pay such tax prior to reimbursement fromWarner Bros., and such indemnification is subject toWarner Bros.’ credit risk. If the IRS or another tax authoritywere to so conclude, there could be a material adverseimpact on our business, financial condition, results ofoperations and cash flows.Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)\\nDollars in millions except per share amounts\\n.',\n", " 'CAUTIONARY LANGUAGE CONCERNING FORWARD-\\nLOOKING STATEMENTS\\nInformation set forth in this report contains forward-looking statements\\nthat are subject to risks and uncertainties, and actual results could differmaterially. Many of these factors are discussed in more detail in the “RiskFactors” section. We claim the protection of the safe harbor for forward-looking statements provided by the Private Securities Litigation ReformAct of 1995.\\nThe following factors could cause our future results to differ materially\\nfrom those expressed in the forward-looking statements:\\n• The severity, magnitude and duration of the COVID-19 pandemic and\\ncontainment, mitigation and other measures taken in response,including the potential impacts of these matters on our business andoperations.\\n• Our inability to predict the extent to which the COVID-19 pandemic\\nand related impacts will continue to impact our business operations,financial performance and results of operations.\\n• Adverse economic, political and/or capital access changes or war or\\nother hostilities in the markets served by us or in countries in whichwe have investments and/or operations, including inflationarypressures, the impact on customer demand and our ability and oursuppliers’ ability to access financial markets at favorable rates andterms.',\n", " '• Increases in our benefit plans’ costs, including increases due to\\nadverse changes in the United States and foreign securities markets,resulting in worse-than-assumed investment returns and discountrates; adverse changes in mortality assumptions; adverse medicalcost trends; and unfavorable or delayed implementation or repeal ofhealthcare legislation, regulations or related court decisions.\\n• The final outcome of FCC and other federal, state or foreign\\ngovernment agency proceedings (including judicial review, if any, ofsuch proceedings) and legislative efforts involving issues that areimportant to our business, including, without limitation, pendingNotices of Apparent Liability; the transition from legacy technologiesto IP-based infrastructure, including the withdrawal of legacy TDM-based services; universal service; broadband deployment; wirelessequipment siting regulations and, in particular, siting for 5G service;E911 services; rules concerning digital discrimination; competitionpolicy; privacy; net neutrality; copyright protection; availability ofnew spectrum on fair and balanced terms; and wireless and satellitelicense awards and renewals.',\n", " '• Enactment of additional state, local, federal and/or foreign\\nregulatory and tax laws and regulations, or changes to existingstandards and actions by tax agencies and judicial authoritiesincluding the resolution of disputes with any taxing jurisdictions,pertaining to our subsidiaries and foreign investments, includinglaws and regulations that reduce our incentive to invest in ournetworks, resulting in lower revenue growth and/or higher operatingcosts.\\n• U.S. and foreign laws and regulations regarding intellectual property\\nrights protection and privacy, personal data protection and userconsent, which are complex and rapidly evolving and could result inadverse impacts to our business plans, increased costs, or claimsagainst us that may harm our reputation.',\n", " '• Our ability to compete in an increasingly competitive industry and\\nagainst competitors that can offer product/service offerings at lowerprices due to lower cost structures and regulatory and legislativeactions adverse to us, including non-regulation of comparablealternative technologies and/or government-owned or subsidizednetworks.• Disruption in our supply chain for a number of reasons, including,\\ndifficulties in obtaining export licenses for certain technology,inability to secure component parts, general business disruption,workforce shortage, natural disasters, safety issues, vendor fraud,economic and political instability, including the outbreak of war orother hostilities, and public health emergencies.\\n• The continued development and delivery of attractive and profitable\\nwireless, and broadband offerings and devices; the extent to whichregulatory and build-out requirements apply to our offerings; ourability to match speeds offered by our competitors; and theavailability, cost and/or reliability of the various technologies and/orcontent required to provide such offerings.\\n• The availability and cost and our ability to adequately fund additional\\nwireless spectrum and network development, deployment andmaintenance; and regulations and conditions relating to spectrumuse, licensing, obtaining additional spectrum, technical standards anddeployment and usage, including network management rules.',\n", " '• Our ability to manage growth in wireless data services, including\\nnetwork quality and acquisition of adequate spectrum at reasonablecosts and terms.\\n• The outcome of pending, threatened or potential litigation (which\\nincludes arbitrations), including, without limitation, patent andproduct safety claims by or against third parties or claims based onalleged misconduct by employees.\\n• The impact from major equipment or software failures on our\\nnetworks or cyber incidents; the effect of security breaches relatedto the network or customer information; our inability to obtainhandsets, equipment/software or have handsets, equipment/software serviced in a timely and cost-effective manner fromsuppliers; or severe weather conditions or other climate relatedevents including flooding and hurricanes, natural disasters includingearthquakes and forest fires, pandemics, energy shortages, wars orterrorist attacks.\\n• The issuance by the FASB or other accounting oversight bodies of\\nnew accounting standards or changes to existing standards.\\n• Our response to competition and regulatory, legislative and\\ntechnological developments.\\n• The uncertainty surrounding further congressional action regarding\\nspending and taxation, which may result in changes in governmentspending and affect the ability and willingness of businesses andconsumers to spend in general.',\n", " '• Our ability to realize or sustain the expected benefits of our business\\ntransformation initiatives, which are designed to reduce costs,streamline distribution, remove redundancies and simplify andimprove processes and support functions.\\n• Our ability to successfully complete divestitures, as well as achieve\\nour expectations regarding the financial impact of the completedand/or pending transactions.\\nReaders are cautioned that other factors discussed in this report,\\nalthough not enumerated here, also could materially affect our futureearnings.\\n..',\n", " '2022 2021 2020\\nOperating Revenues\\nService $ 97,831 $ 111,565 $ 124,057\\nEquipment 22,910 22,473 18,993\\nTotal operating revenues 120,741 134,038 143,050\\nOperating Expenses\\nCost of revenues\\nEquipment 24,009 23,685 19,585\\nBroadcast, programming and operations — 8,106 16,077\\nOther cost of revenues (exclusive of depreciation\\nand amortization shown separately below) 26,839 28,616 29,989\\nSelling, general and administrative 28,961 29,669 30,817\\nAsset impairments and abandonments and restructuring 27,498 213 15,687\\nDepreciation and amortization 18,021 17,852 22,523\\nTotal operating expenses 125,328 108,141 134,678\\nOperating Income (Loss) (4,587) 25,897 8,372\\nOther Income (Expense)\\nInterest expense (6,108) (6,716) (7,727)\\nEquity in net income of affiliates 1,',\n", " '716) (7,727)\\nEquity in net income of affiliates 1,791 603 89\\nOther income (expense) – net 5,810 9,387 (1,088)\\nTotal other income (expense) 1,493 3,274 (8,726)\\nIncome (Loss) from Continuing Operations Before Income Taxes (3,094) 29,171 (354)\\nIncome tax expense on continuing operations 3,780 5,395 1,168\\nIncome (Loss) from Continuing Operations (6,874) 23,776 (1,522)\\nLoss from discontinued operations, net of tax (181) (2,297) (2,299)\\nNet Income (Loss) (7,055) 21,479 (3,821)\\nLess: Net Income Attributable to Noncontrolling Interest (1,469) (1,398) (1,355)\\nNet Income (Loss) Attributable to AT&T $ (8,524) $ 20,081 $ (5,176)\\nLess: Preferred Stock Dividends (203) (207) (193)\\nNet Income (Loss) Attributable to Common Stock $ (8,727) $ 19,',\n", " '727) $ 19,874 $ (5,369)\\nBasic Earnings (Loss) Per Share from continuing operations $ (1.10) $ 3.07 $ (0.45)\\nBasic Loss Per Share from discontinued operations $ (0.03) $ (0.30) $ (0.30)\\nBasic Earnings (Loss) Per Share Attributable to Common Stock $ (1.13) $ 2.77 $ (0.75)\\nDiluted Earnings (Loss) Per Share from continuing operations $ (1.10) $ 3.02 $ (0.45)\\nDiluted Loss Per Share from discontinued operations $ (0.03) $ (0.29) $ (0.30)\\nDiluted Earnings (Loss) Per Share Attributable to Common Stock $ (1.13) $ 2.73 $ (0.75)\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Statements of Income\\nDollars in millions except per share amounts\\n.:',\n", " '2022 2021 2020\\nNet income (loss) $ (7,055) $ 21,479 $ (3,821)\\nOther comprehensive income (loss), net of tax:Foreign Currency:\\nTranslation adjustment (includes $0, $(2) and $(59) attributable to\\nnoncontrolling interest), net of taxes of $90, $(44) and $(42) 346 (127) (929)\\nReclassification adjustment included in net income (loss), net of taxes of\\n$0, $204 and $0 — 2,087 —\\nDistributions of WarnerMedia, net of taxes of $(38), $0 and $0 (182) ——\\nSecurities:\\nNet unrealized gains (losses), net of taxes of $(49), $(21) and $27 (143) (63) 78\\nReclassification adjustment included in net income (loss),\\nnet of taxes of $3, $(1) and $(5) 8 (3) (15)\\nDerivative Instruments:\\nNet unrealized gains (losses), net of taxes of $(183), $(192) and $(212) (648) (715) (811)\\nReclassification adjustment included in net income (loss),',\n", " 'net of taxes of $25, $19 and $18 96 72 69\\nDistributions of WarnerMedia, net of taxes of $(12), $0 and $0 (24) ——\\nDefined benefit postretirement plans:\\nNet prior service (cost) credit arising during period, net of taxes of $583,\\n$(8) and $735 1,787 (34) 2,250\\nAmortization of net prior service credit included in net income (loss),\\nnet of taxes of $(663), $(660) and $(601) (2,028) (2,020) (1,841)\\nDistribution of WarnerMedia, net of taxes of $5, $0 and $0 25 ——\\nOther comprehensive income (loss) (763) (803) (1,199)\\nTotal comprehensive income (loss) (7,818) 20,676 (5,020)\\nLess: Total comprehensive income attributable to noncontrolling interest (1,469) (1,396) (1,296)\\nTotal Comprehensive Income (Loss) Attributable to AT&T $ (9,287) $ 19,280 $ (6,',\n", " '287) $ 19,280 $ (6,316)\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Statements of Comprehensive Income\\nDollars in millions except per share amounts\\n.',\n", " 'December 31,\\n2022 2021\\nAssets\\nCurrent AssetsCash and cash equivalents $ 3,701 $ 19,223\\nAccounts receivable – net of related allowance for credit loss of $588 and $658 11,466 12,313\\nInventories 3,123 3,325\\nPrepaid and other current assets 14,818 16,131\\nAssets from discontinued operations — 119,776\\nTotal current assets 33,108 170,768\\nProperty, Plant and Equipment – Net 127,445 121,649\\nGoodwill – Net 67,895 92,740\\nLicenses – Net 124,092 113,830\\nOther Intangible Assets – Net 5,354 5,391\\nInvestments in and Advances to Equity Affiliates 3,533 6,168\\nOperating Lease Right-Of-Use Assets 21,814 21,824\\nOther Assets 19,612 19,252\\nTotal Assets $ 402,853 $ 551,622\\nLiabilities and Stockholders’ Equity\\nCurrent LiabilitiesDebt maturing within one year $7 , 4 6 7 $ 24,',\n", " '4 6 7 $ 24,620\\nNote payable to DIRECTV 130 1,245\\nAccounts payable and accrued liabilities 42,644 39,095\\nAdvanced billings and customer deposits 3,918 3,966\\nDividends payable 2,014 3,749\\nLiabilities from discontinued operations — 33,555\\nTotal current liabilities 56,173 106,230\\nLong-Term Debt 128,423 151,011\\nDeferred Credits and Other Noncurrent LiabilitiesDeferred income taxes 57,032 53,767\\nPostemployment benefit obligation 7,260 12,560\\nOperating lease liabilities 18,659 18,956\\nOther noncurrent liabilities 28,849 25,243\\nTotal deferred credits and other noncurrent liabilities 111,800 110,526\\nStockholders’ Equity\\nPreferred stock ($1 par value, 10,000,000 authorized at December 31, 2022\\nand December 31, 2021):\\nSeries A (48,000 issued and outstanding at December 31, 2022 and December 31, 2021) — —\\nSeries B (20,',\n", " '2022 and December 31, 2021) — —\\nSeries B (20,000 issued and outstanding at December 31, 2022 and December 31, 2021) — —\\nSeries C (70,000 issued and outstanding at December 31, 2022 and December 31, 2021) — —\\nCommon stock ($1 par value, 14,000,000,000 authorized at December 31, 2022 and\\nDecember 31, 2021: issued 7,620,748,598 at December 31, 2022 and December 31, 2021) 7,621 7,621\\nAdditional paid-in capital 123,610 130,112\\nRetained (deficit) earnings (19,415)\\n42,350\\nTreasury stock (493,156,816 at December 31, 2022 and 479,684,705 at December 31, 2021, at cost) (17,082) (17,280)\\nAccumulated other comprehensive income 2,766 3,529\\nNoncontrolling interest 8,957 17,523\\nTotal stockholders’ equity 106,',\n", " '957 17,523\\nTotal stockholders’ equity 106,457 183,855\\nTotal Liabilities and Stockholders’ Equity $ 402,853 $ 551,622\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Balance Sheets\\nDollars in millions except per share amounts\\n.;',\n", " '2022 2021 2020\\nOperating Activities\\nIncome (loss) from continuing operations $ (6,874) $ 23,776 $ (1,522)\\nAdjustments to reconcile net income (loss) from continuing operations to net cash provided\\nby operating activities from continuing operations:\\nDepreciation and amortization 18,021 17,852 22,523\\nProvision for uncollectible accounts 1,865 1,241 1,798\\nDeferred income tax expense 2,975 7,412 2,145\\nNet (gain) loss on investments, net of impairments 381 (369) (970)\\nPension and postretirement benefit expense (credit) (3,237) (3,857) (2,992)\\nActuarial (gain) loss on pension and postretirement benefits (1,999) (4,143) 4,169\\nAsset impairments and abandonments and restructuring 27,498 213 15,687\\nChanges in operating assets and liabilities:\\nReceivables 727 (1,125) 1,079\\nOther current assets (674) (1,288) (2,',\n", " '079\\nOther current assets (674) (1,288) (2,138)\\nAccounts payable and other accrued liabilities (1,109) (1,570) (1,895)\\nEquipment installment receivables and related sales 154 (271) (1,428)\\nDeferred customer contract acquisition and fulfillment costs (947) 18 382\\nPostretirement claims and contributions (823) (822) (985)\\nOther – net (146) 103 1,631\\nTotal adjustments 42,686 13,394 39,006\\nNet Cash Provided by Operating Activities from Continuing Operations 35,812 37,170 37,484\\nInvesting Activities\\nCapital expenditures (19,626) (15,545) (14,690)\\nAcquisitions, net of cash acquired (10,200) (25,453) (1,625)\\nDispositions 199 7,136 2,472\\nDistributions from DIRECTV in excess of cumulative equity in earnings 2,649 1,323 —\\nOther – net 79 50 396\\nNet Cash Used in Investing Activities from Continuing Operations (26,899) (32,489) (13,',\n", " '899) (32,489) (13,447)\\nFinancing Activities\\nNet change in short-term borrowings with original maturities of three months or less (519) 1,316 (17)\\nIssuance of other short-term borrowings 3,955 21,856 9,440\\nRepayment of other short-term borrowings (18,345) (7,510) (9,467)\\nIssuance of long-term debt 2,979 9,931 31,988\\nRepayment of long-term debt (25,118) (3,039) (39,062)\\nNote payable to DIRECTV, net of payments (1,211) 1,341 —\\nPayment of vendor financing (4,697) (4,596) (2,966)\\nIssuance of preferred stock — — 3,869\\nPurchase of treasury stock (890) (202) (5,498)\\nIssuance of treasury stock 28 96 105\\nIssuance of preferred interests in subsidiaries — — 1,979\\nRedemption of preferred interest in subsidiary (2,665) — (1,950)\\nDividends paid (9,859) (15,',\n", " '665) — (1,950)\\nDividends paid (9,859) (15,068) (14,956)\\nOther – net (3,222) (2,231) (4,496)\\nNet Cash (Used in) Provided by Financing Activities from Continuing Operations (59,564) 1,894 (31,031)\\nNet (decrease) increase in cash and cash equivalents and restricted cash from continuing\\noperations (50,651) 6,575 (6,994)\\nCash flows from Discontinued Operations:Cash (used in) provided by operating activities (3,789) 4,788 5,645\\nCash provided by (used in) investing activities 1,094 399 (102)\\nCash provided by (used in) financing activities 35,823 (316) (974)\\nNet increase (decrease) in cash and cash equivalents and restricted cash from discontinued\\noperations 33,128 4,871 4,569\\nNet (decrease) increase in cash and cash equivalents and restricted cash (17,523) 11,446 (2,425)\\nCash and cash equivalents and restricted cash beginning of year 21,316 9,870 12,',\n", " '316 9,870 12,295\\nCash and Cash Equivalents and Restricted Cash End of Year $ 3,793 $ 21,316 $ 9,870\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Statements of Cash Flows\\nDollars in millions except per share amounts\\n.?',\n", " '2022 2021 2020\\nShares Amount Shares Amount Shares Amount\\nPreferred Stock – Series A\\nBalance at beginning of year —$ — —$ — —$ —\\nBalance at end of year —$ — —$ — —$ —\\nPreferred Stock – Series B\\nBalance at beginning of year —$ — —$ — —$ —\\nBalance at end of year —$ — —$ — —$ —\\nPreferred Stock – Series C\\nBalance at beginning of year —$ — —$ — —$ —\\nBalance at end of year —$ — —$ — —$ —\\nCommon Stock\\nBalance at beginning of year 7,621 $ 7,621 7,621 $ 7,621 7,621 $ 7,621\\nBalance at end of year 7,621 $ 7,621 7,621 $ 7,621 7,621 $ 7,621\\nAdditional Paid-In Capital\\nBalance at beginning of year $ 130,112 $ 130,175 $ 126,279\\nDistribution of WarnerMedia (6,832) ——\\nRepurchase and acquisition of common stock — —6 7\\nIssuance of preferred stock — — 3,',\n", " '869\\nIssuance of treasury stock (171) (76) (62)\\nShare-based payments (162) 13 18\\nAcquisition or reclassification of interests\\nheld by noncontrolling owners 663 —4\\nBalance at end of year $ 123,610 $ 130,112 $ 130,175\\nRetained (Deficit) Earnings\\nBalance at beginning of year $ 42,350 $ 37,457 $ 57,936\\nCumulative effect of accounting changes\\nand other adjustments — — (293)\\nAdjusted beginning balance 42,350 37,457 57,643\\nNet income (loss) attributable to AT&T (8,524) 20,081 (5,176)\\nDistribution of WarnerMedia (45,041) ——\\nPreferred stock dividends (207) (224) (139)\\nCommon stock dividends ($1.11, $2.08 and $2.08 per share) (7,993) (14,964) (14,871)\\nBalance at end of year $ (19,415) $ 42,350 $ 37,457\\nThe accompanying notes are an integral part of the consolidated financial statements.',\n", " '350 $ 37,457\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Statements of Changes in Stockholders’ Equity\\nDollars and shares in millions except per share amounts\\n.!',\n", " '2022 2021 2020\\nShares Amount Shares Amount Shares Amount\\nTreasury Stock\\nBalance at beginning of year (480) $ (17,280) (495) $ (17,910) (366) $ (13,085)\\nRepurchase and acquisition of common stock (44) (890) (8) (237) (150) (5,631)\\nIssuance of treasury stock 31 1,088 23 867 21 806\\nBalance at end of year (493) $ (17,082) (480) $ (17,280) (495) $ (17,910)\\nAccumulated Other Comprehensive Income\\nAttributable to AT&T, net of tax\\nBalance at beginning of year $ 3,529 $ 4,330 $ 5,470\\nOther comprehensive income (loss) attributable to AT&T (763) (801) (1,140)\\nBalance at end of year $ 2,766 $ 3,529 $ 4,330\\nNoncontrolling Interest\\nBalance at beginning of year $ 17,523 $ 17,567 $ 17,',\n", " '523 $ 17,567 $ 17,713\\nCumulative effect of accounting\\nchanges and other adjustments — — (7)\\nAdjusted beginning balance 17,523 17,567 17,706\\nNet income attributable to\\nnoncontrolling interest 1,469 1,398 1,355\\nIssuance and acquisition (disposition) of\\nnoncontrolling owners (21) 7 1,979\\nRedemption of noncontrolling interest (2,665) — (1,950)\\nReclassification of noncontrolling interest (5,997) ——\\nDistributions (1,352) (1,447) (1,464)\\nTranslation adjustments attributable to\\nnoncontrolling interest, net of taxes — (2) (59)\\nBalance at end of year $ 8,957 $ 17,523 $ 17,567\\nTotal Stockholders’ Equity at beginning of year $ 183,855 $ 179,240 $ 201,934\\nTotal Stockholders’ Equity at end of year $ 106,457 $ 183,855 $ 179,240\\nThe accompanying notes are an integral part of the consolidated financial statements.',\n", " '855 $ 179,240\\nThe accompanying notes are an integral part of the consolidated financial statements.Consolidated Statements of Changes in Stockholders’ Equity – continued\\nDollars and shares in millions except per share amounts\\n.¿',\n", " 'NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING\\nPOLICIES\\nBasis of Presentation Throughout this document, AT&T\\nInc. is referred to as “AT&T,” “we” or the “Company.” Theconsolidated financial statements include the accounts ofthe Company and subsidiaries and affiliates which wecontrol. AT&T is a holding company whose subsidiariesand affiliates operate worldwide in thetelecommunications and technology industries.\\nOn April 8, 2022, we completed the separation of our\\nWarnerMedia business, which represented substantially allof our WarnerMedia segment, in a Reverse Morris Trusttransaction, under which Magallanes, Inc. (Spinco), aformerly wholly-owned subsidiary of AT&T that held theWarnerMedia business, was distributed to AT&Tstockholders via a pro rata dividend, followed by thecombination of Spinco with a subsidiary of Discovery, Inc.(Discovery), which was renamed Warner Bros. Discovery,Inc. (WBD). (See Note 6)\\nUpon the separation and distribution, the WarnerMedia\\nbusiness met the criteria for discontinued operations.',\n", " 'Fordiscontinued operations, we also evaluated transactionsthat were components of AT&T’s single plan of a strategicshift, including dispositions that previously did notindividually meet the criteria due to materiality, and havedetermined discontinued operations to be comprised ofWarnerMedia, Vrio, Xandr and Playdemic Ltd. (Playdemic).These businesses are reflected in the accompanyingfinancial statements as discontinued operations, includingfor periods prior to the consummation of theWarnerMedia/Discovery transaction. (See Notes 6 and 23)\\nOn July 31, 2021, we closed our transaction with TPG\\nCapital (TPG) to form a new company named DIRECTVEntertainment Holdings, LLC (DIRECTV). With the close ofthe transaction, we separated and deconsolidated ourVideo business, comprised of our U.S. video operations,and began accounting for our investment in DIRECTVunder the equity method (see Notes 6, 10 and 19).\\nAll significant intercompany transactions are eliminated in\\nthe consolidation process.',\n", " 'All significant intercompany transactions are eliminated in\\nthe consolidation process. Investments in subsidiaries andpartnerships which we do not control but have significantinfluence are accounted for under the equity method.Earnings from certain investments accounted for usingthe equity method are included in our results on a onequarter lag. We also record our proportionate share of ourequity method investees’ other comprehensive income(OCI) items, including translation adjustments. We treatdistributions received from equity method investees asreturns on investment and classify them as cash flowsfrom operating activities until those distributions exceedour cumulative equity in the earnings of that investment.We treat the excess amount as a return of investment andclassify it as cash flows from investing activities.\\nThe preparation of financial statements in conformity\\nwith U.S. generally accepted accounting principles (GAAP)requires management to make estimates andassumptions, including other estimates of fair value,\\nprobable losses and expenses, that affect the amountsreported in the financial statements and accompanyingnotes. Actual results could differ from those estimates.Moreover, unfavorable changes in market conditions,including interest rates, could adversely impact thoseestimates and result in asset impairments. Certain prior-period amounts have been conformed to the currentperiod’s presentation.',\n", " 'Certain prior-period amounts have been conformed to the currentperiod’s presentation. Unless otherwise noted, theinformation in Notes 1 through 22 and 24 refer only to ourcontinuing operations and do not include discussion ofbalances or activity of WarnerMedia, Vrio, Xandr andPlaydemic, which are part of discontinued operations.\\nAdopted and New Accounting StandardsConvertible Instruments Beginning with 2022 interim\\nreporting, we adopted, through retrospective application,the Financial Accounting Standards Board’s (FASB)Accounting Standards Update (ASU) No. 2020-06, “Debt—Debt With Conversion and Other Options (Subtopic470-20) and Derivatives and Hedging—Contracts inEntity’s Own Equity (Subtopic 815-40): Accounting forConvertible Instruments and Contracts in an Entity’s OwnEquity” (ASU 2020-06). ASU 2020-06 requires thatinstruments which may be settled in cash or stock arepresumed settled in stock in calculating diluted earningsper share.',\n", " 'While our intent is to settle the Series ACumulative Perpetual Membership Interests in AT&TMobility II LLC (Mobility preferred interests) in cash,settlement of this instrument in AT&T shares would resultin additional dilutive impact, the magnitude of which isinfluenced by the fair value of the Mobility preferredinterests and the average AT&T common stock priceduring the reporting period, which could vary from period-to-period (see Note 16).\\nThe following table presents the impact of the adoption\\nof ASU 2020-06 on our diluted earnings per share fromcontinuing operations:\\nDiluted earnings per share from\\ncontinuing operations:Historical\\nAccounting\\nMethodEffect of\\nAdoption\\nof ASU\\n2020-061Under ASU\\n2020-06\\nYear ended December 31, 2022 $ (1.10) $ — $ (1.10)\\nYear ended December 31, 2021 $ 3.07 $ (0.05) $ 3.02\\nYear ended December 31, 2020 $ (0.45) $ — $ (0.45)\\n1See Note 2 for a discussion of the numerator and denominator adjustments.',\n", " 'Reference Rate Reform In March 2020, the FASB issued\\nASU No. 2020-04, “Reference Rate Reform (Topic 848):Facilitation of the Effects of Reference Rate Reform onFinancial Reporting” (ASU 2020-04, as amended), whichprovides optional expedients, and allows for certainexceptions to existing GAAP, for contract modificationstriggered by the expected market transition of certainbenchmark interest rates to alternative reference rates.ASU 2020-04 applies to contracts, hedging relationships,Notes to Consolidated Financial Statements\\nDollars in millions except per share amounts\\n:\\x08',\n", " 'certain derivatives and other arrangements that\\nreference the London Interbank Offering Rate (LIBOR) orany other rates ending after December 31, 2024. ASU2020-04, as amended, became effective immediately. Wedo not believe our adoption of ASU 2020-04, includingoptional expedients, will materially impact our financialstatements.\\nGovernment Assistance In November 2021, the FASB\\nissued ASU No. 2021-10, “Government Assistance (Topic832): Disclosures by Business Entities about GovernmentAssistance” (ASU 2021-10), which requires annualdisclosures (e.g., terms and conditions, accountingtreatment, impacted financial statement lines), in thenotes to the financial statements, about transactions witha government that are accounted for by applying a grantor contribution accounting model by analogy to otherguidance. We adopted ASU 2021-10 effective for theannual reporting period ended December 31, 2022, asrequired, under prospective application, with no requiredupdates to our disclosures.',\n", " 'Credit Losses As of January 1, 2020, we adopted,\\nthrough modified retrospective application, ASU No.2016-13, “Financial Instruments—Credit Losses (Topic 326):Measurement of Credit Losses on Financial Instruments,”or Accounting Standards Codification (ASC) 326 (ASC 326),which replaces the incurred loss impairment methodologyunder prior GAAP with an expected credit loss model. ASC326 affects trade receivables, loans, contract assets,certain beneficial interests, off-balance-sheet creditexposures not accounted for as insurance and otherfinancial assets that are not subject to fair value throughnet income, as defined by the standard. Under theexpected credit loss model, we are required to considerfuture economic trends to estimate expected creditlosses over the lifetime of the asset. Upon adoption onJanuary 1, 2020, we recorded a $293 reduction to“Retained earnings,” $395 increase to “Allowances forcredit losses” applicable to our trade and loan receivables,$10 reduction of contract assets, $105 reduction of netdeferred income tax liability and $7 reduction of“Noncontrolling interest.” Our adoption of ASC 326 did nothave a material impact on our financial statements.',\n", " 'Supplier Finance Obligations In September 2022, the\\nFASB issued ASU No. 2022-04, “Liabilities – SupplierFinance Programs (Subtopic 405-50): Disclosure ofSupplier Finance Program Obligations” (ASU 2022-04),which establishes interim and annual reporting disclosurerequirements about a company’s supplier financeprograms for its purchase of goods and services. Interimand annual requirements include disclosure ofoutstanding amounts under the obligations as of the endof the reporting period, and annual requirements include arollforward of those obligations for the annual reportingperiod, as well as a description of payment and other keyterms of the programs. ASU 2022-04 will be effective forinterim and annual periods beginning after December 15,2022, with retrospective application, except for the annualrollforward requirement, which becomes effective forannual periods beginning after December 15, 2023, with\\nprospective application. The standard allows earlyadoption of all requirements. In the year of adoption, thedisclosure of payment and other key terms under theprograms and outstanding balances under the obligationswill also apply to interim reporting dates.',\n", " 'We are in theprocess of evaluating the impact of our adoption of ASU2022-04.\\nAccounting PoliciesIncome Taxes We record deferred income taxes for\\ntemporary differences between the carrying amounts ofassets and liabilities for financial reporting purposes andthe computed tax basis of those assets and liabilities. Werecord valuation allowances against the deferred taxassets (included, together with our deferred income taxassets, as part of our reportable net deferred income taxliabilities on our consolidated balance sheets), for whichthe realization is uncertain. We review these itemsregularly in light of changes in federal, state and foreigntax laws and changes in our business.\\nAs of January 1, 2021, we adopted, with modified\\nretrospective application, the FASB’s ASU No. 2019-12,“Income Taxes (Topic 740): Simplifying the Accounting forIncome Taxes” (ASU 2019-12), which simplified income taxaccounting requirements in areas deemed costly andcomplex. ASU 2019-12 did not have a material impact onour financial statements.\\nCash and Cash Equivalents Cash and cash equivalents\\ninclude all highly liquid investments with originalmaturities of three months or less.',\n", " 'The carrying amountsapproximate fair value. At December 31, 2022, we held$866 in cash and $2,835 in money market funds and othercash equivalents. Of our total cash and cash equivalents,$1,045 resided in foreign jurisdictions, some of which issubject to restrictions on repatriation.\\nAllowance for Credit Losses We record expense to\\nmaintain an allowance for credit losses for estimatedlosses that result from the failure or inability of ourcustomers to make required payments deemed collectiblefrom the customer when the service was provided orproduct was delivered. When determining the allowancesfor trade receivables and loans, we consider theprobability of recoverability of accounts receivable basedon past experience, taking into account current collectiontrends and general economic factors, includingbankruptcy rates. We also consider future economictrends to estimate expected credit losses over thelifetime of the asset. Credit risks are assessed based onhistorical write-offs, net of recoveries, as well as ananalysis of the aged accounts receivable balances withallowances generally increasing as the receivable ages.Accounts receivable may be fully reserved for whenspecific collection issues are known to exist, such ascatastrophes or pending bankruptcies.',\n", " ':',\n", " 'Inventories Inventories primarily consist of wireless\\ndevices and accessories and are valued at the lower ofcost or net realizable value.\\nProperty, Plant and Equipment Property, plant and\\nequipment is stated at cost, except for assets acquiredusing acquisition accounting, which are initially recordedat fair value (see Note 7). The cost of additions andsubstantial improvements to property, plant andequipment is capitalized, and includes internalcompensation costs for these projects. The cost ofmaintenance and repairs of property, plant andequipment is charged to operating expenses. Property,plant and equipment costs are depreciated using straight-line methods over their estimated economic lives. Certainsubsidiaries follow composite group depreciationmethodology. Accordingly, when a portion of theirdepreciable property, plant and equipment is retired in theordinary course of business, the gross book value isreclassified to accumulated depreciation, and no gain orloss is recognized on the disposition of these assets.\\nProperty, plant and equipment is reviewed for\\nrecoverability whenever events or changes incircumstances indicate that the carrying amount of anasset group may not be recoverable. We recognize animpairment loss when the carrying amount of a long-livedasset is not recoverable.',\n", " 'The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of theundiscounted cash flows expected to result from the useand eventual disposition of the asset. (See Note 7)\\nThe liability for the fair value of an asset retirement\\nobligation is recorded in the period in which it is incurred ifa reasonable estimate of fair value can be made. Inperiods subsequent to initial measurement, we recognizeperiod-to-period changes in the liability resulting from thepassage of time and revisions to either the timing or theamount of the original estimate. The increase in thecarrying value of the associated long-lived asset isdepreciated over the corresponding estimated economiclife.\\nSoftware Costs We capitalize certain costs incurred in\\nconnection with developing or obtaining internal-usesoftware. Capitalized software costs are included in“Property, Plant and Equipment – Net” on our consolidatedbalance sheets. In addition, there is certain networksoftware that allows the equipment to provide thefeatures and functions unique to the AT&T network, whichwe include in the cost of the equipment categories forfinancial reporting purposes.',\n", " 'We amortize our capitalized software costs over a three-\\nyear to seven-year period, reflecting the estimated periodduring which these assets will remain in service.\\nGoodwill and Other Intangible Assets We have the\\nfollowing major classes of intangible assets: goodwill;licenses, which include Federal CommunicationsCommission (FCC) and other wireless licenses; trademarksand trade names; customer lists; and various other finite-lived intangible assets (see Note 9).Goodwill represents the excess of consideration paid over\\nthe fair value of identifiable net assets acquired inbusiness combinations. Wireless licenses provide us withthe exclusive right to utilize certain radio frequencyspectrum to provide wireless communications services.While wireless licenses are issued for a fixed period of time(generally ten years), renewals of domestic wirelesslicenses have occurred routinely and at nominal cost. Wehave determined that there are currently no legal,regulatory, contractual, competitive, economic or otherfactors that limit the useful lives of our FCC wirelesslicenses.\\nWe amortize our wireless licenses in Mexico over their\\naverage remaining economic life of 25 years.\\nWe acquired the rights to the AT&T and other trade\\nnames in previous acquisitions, classifying certain of thosetrade names as indefinite-lived.',\n", " 'We have the effectiveability to retain these exclusive rights permanently at anominal cost.\\nGoodwill, FCC wireless licenses and other indefinite-lived\\nintangible assets are not amortized but are tested at leastannually for impairment (see Note 9). The testing isperformed on the value as of October 1 each year andcompares the book values of the assets to their fairvalues. Goodwill is tested by comparing the carryingamount of each reporting unit, deemed to be our principaloperating segments or one level below them, to the fairvalue using both discounted cash flow as well as marketmultiple approaches. FCC wireless licenses are tested onan aggregate basis, consistent with our use of the licenseson a national scope, using a discounted cash flowapproach. Trade names are tested by comparing theirbook values to their fair values calculated using adiscounted cash flow approach on a presumed royaltyrate derived from the revenues related to each brandname.\\nIntangible assets that have finite useful lives are\\namortized over their estimated economic lives (see Note9).',\n", " 'Customer lists and relationships are amortized usingprimarily the sum-of-the-months-digits method ofamortization over the period in which those relationshipsare expected to contribute to our future cash flows.Finite-lived trademarks and trade names are amortizedusing the straight-line method over the estimated usefullife of the assets. The remaining finite-lived intangibleassets are generally amortized using the straight-linemethod. These assets, along with other long-lived assets,are reviewed for recoverability whenever events orchanges in circumstances indicate that the carryingamount of an asset group may not be recoverable.\\nAdvertising Costs We expense advertising costs for\\nproducts and services or for promoting our corporateimage as incurred (see Note 22).Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n:',\n", " 'Foreign Currency Translation Our foreign subsidiaries\\nand foreign investments generally report their earnings intheir local currencies. We translate their foreign assetsand liabilities at exchange rates in effect at the balancesheet dates. We translate their revenues and expensesusing average rates during the year. The resulting foreigncurrency translation adjustments are recorded as aseparate component of accumulated OCI in ourconsolidated balance sheets (see Note 3).We hedge a portion of the foreign currency exchange risk\\ninvolved in certain foreign currency-denominatedtransactions, which we explain further in our discussion ofour methods of managing our foreign currency risk (seeNote 12).\\nPension and Other Postretirement Benefits See Note 14\\nfor a comprehensive discussion of our pension andpostretirement benefits, including a discussion of theactuarial assumptions, our policy for recognizing theassociated gains and losses and our method used toestimate service and interest cost components.\\nNOTE 2. EARNINGS PER SHARE\\nA reconciliation of the numerators and denominators of basic and diluted earnings per share is shown in the table below:\\nYear Ended December 31, 2022 2021 2020\\nNumerators\\nNumerator for basic earnings per share:\\nIncome (loss) from continuing operations,',\n", " 'net of tax $ (6,874) $ 23,776 $ (1,522)\\nNet income from continuing operations attributable to noncontrolling interests (1,469) (1,485) (1,470)\\nPreferred Stock Dividends (203) (207) (193)\\nIncome (loss) from continuing operations attributable to common stock (8,546) 22,084 (3,185)\\nAdjustment to carrying value of noncontrolling interest 663 ——\\nNumerator for basic earnings per share from continuing operations1(7,883) 22,084 (3,185)\\nLoss from discontinued operations, net of tax (181) (2,297) (2,299)\\nLoss from discontinued operations attributable to noncontrolling interests — 87 115\\nLoss from discontinued operations attributable to common stock (181) (2,210) (2,184)\\nNumerator for basic earnings per share1$ (8,064) $ 19,874 $ (5,369)\\nDilutive potential common shares:\\nMobility preferred interests2526 560 560\\nShare-based payment217 22 23\\nNumerator for diluted earnings per share $ (7,521) $ 20,',\n", " '521) $ 20,456 $ (4,786)\\nDenominators (000,000)Denominator for basic earnings per share:\\nWeighted average number of common shares outstanding 7,166 7,168 7,157\\nDilutive potential common shares:\\nMobility preferred interests (in shares) 378 304 283\\nShare-based payment (in shares) 43 31 26\\nDenominator for diluted earnings per share\\n27,587 7,503 7,466\\n1For 2022, in the calculation of basic earnings per share, income (loss) attributable to common stock for continuing operations and total company has b een increased by\\n$663 from adjustment to carrying value of noncontrolling interest. (See Note 16)\\n2For 2022 and 2020, dilutive potential common shares are not included in the computation of diluted earnings per share because their effect is antidilu tive as a result of\\nthe net loss.\\nUpon the adoption of ASU 2020-06 in the first quarter of 2022, the ability to settle our Mobility preferred interests in\\nstock is reflected in our diluted earnings per share calculation, unless the effect is antidilutive.',\n", " 'While our intent is to settlethe Mobility preferred interests in cash, the ability to settle this instrument in AT&T shares will result in additional dilutiveimpact, the magnitude of which is influenced by the fair value of the Mobility preferred interests and the average AT&Tcommon stock price during the reporting period, which could vary from period-to-period. The numerator includes anadjustment to add back to income from continuing operations the earned distributions on the Mobility preferredinterests, included in net income attributable to noncontrolling interest, and the denominator includes the potentialissuance of AT&T common stock to settle the Mobility preferred interests outstanding. (See Notes 1 and 16)\\n:.',\n", " 'NOTE 3. OTHER COMPREHENSIVE INCOME\\nChanges in the balances of each component included in accumulated OCI are presented below. All amounts are net of\\ntax and exclude noncontrolling interest.\\nForeign\\nCurrency\\nTranslation\\nAdjustmentNet Unrealized\\nGains (Losses) on\\nAvailable-for-Sale\\nSecuritiesNet Unrealized\\nGains (Losses)\\non Derivative\\nInstrumentsDefined Benefit\\nPostretirement\\nPlansAccumulated\\nOther\\nComprehensive\\nIncome\\nBalance as of December 31, 2019 $ (3,056) $ 48 $ (37) $ 8,515 $ 5,470\\nOther comprehensive income\\n(loss) before reclassifications (870) 78 (811) 2,250 647\\nAmounts reclassified from accumulated OCI —1(15)1692(1,841)3(1,787)\\nNet other comprehensive income (loss) (870) 63 (742) 409 (1,140)\\nBalance as of December 31, 2020 (3,926) 111 (779) 8,924 4,',\n", " '2020 (3,926) 111 (779) 8,924 4,330Other comprehensive income\\n(loss) before reclassifications (125) (63) (715) (34) (937)\\nAmounts reclassified from accumulated OCI 2,087\\n1,4(3)1722(2,020)3136\\nNet other comprehensive income (loss) 1,962 (66) (643) (2,054) (801)\\nBalance as of December 31, 2021 (1,964) 45 (1,422) 6,870 3,529\\nOther comprehensive income\\n(loss) before reclassifications 346 (143) (648) 1,787 1,342\\nAmounts reclassified from accumulated OCI —181962(2,028)3(1,924)\\nDistribution of WarnerMedia (182) — (24) 25 (181)Net other comprehensive income (loss) 164 (135) (576) (216) (763)\\nBalance as of December 31, 2022 $ (1,800) $ (90) $ (1,998) $ 6,654 $ 2,',\n", " '998) $ 6,654 $ 2,766\\n1(Gains) losses are included in “Other income (expense) – net” in the consolidated statements of income.\\n2(Gains) losses are included in “Interest expense” in the consolidated statements of income (see Note 12).\\n3The amortization of prior service credits associated with postretirement benefits is included in “Other income (expense) – net” in the consolidated statements of income\\n(see Note 14).\\n4Represents unrealized foreign currency translation adjustments at Vrio that were released upon sale. (See Note 6)\\nNOTE 4. SEGMENT INFORMATION\\nOur segments are comprised of strategic business units\\nor other operations that offer products and services todifferent customer segments over various technologyplatforms and/or in different geographies that aremanaged accordingly. We have two reportable segments:Communications and Latin America.\\nWe also evaluate segment and business unit performance\\nbased on EBITDA and/or EBITDA margin, which is definedas operating income excluding depreciation andamortization.',\n", " 'EBITDA is used as part of our managementreporting and we believe EBITDA to be a relevant anduseful measurement to our investors as it measures thecash generation potential of our business units. EBITDAdoes not give effect to depreciation and amortizationexpenses incurred in operating income nor is it burdenedby cash used for debt service requirements and thus doesnot reflect available funds for distributions, reinvestmentor other discretionary uses. EBITDA margin is EBITDAdivided by total revenue.\\nIn the first quarter of 2022, we reclassified into “Corporate”\\ncertain administrative costs borne by AT&T where thebusiness units do not influence decision making toconform with the current period presentation. This recastincreased Corporate operations and support expenses byapproximately $270 and $1,310 for full-year 2021 and 2020,\\nrespectively. Correspondingly, this recast loweredadministrative expenses for the Communicationssegment and Video (our former U.S. video operationscontributed to DIRECTV in July 2021), with no change on aconsolidated basis.\\nTheCommunications segment provides wireless and\\nwireline telecom and broadband services to consumerslocated in the U.S. and businesses globally.',\n", " 'and businesses globally. Our businessstrategies reflect bundled product offerings that cutacross product lines and utilize shared assets. Thissegment contains the following business units:\\n•Mobility provides nationwide wireless service and\\nequipment.\\n•Business Wireline provides advanced ethernet-based\\nfiber services, IP Voice and managed professionalservices, as well as traditional voice and data servicesand related equipment to business customers.\\n•Consumer Wireline provides broadband services,\\nincluding fiber connections that provide our multi-gigservices to residential customers in select locations.Consumer Wireline also provides legacy telephonyvoice communication services.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n::',\n", " 'TheLatin America segment provides wireless services\\nand equipment in Mexico.\\nCorporate andOther reconciles our segment results to\\nconsolidated operating income and income beforeincome taxes.\\nCorporate includes:\\n•DTV-related retained costs , which are costs previously\\nallocated to the Video business that were retainedafter the transaction, net of reimbursements fromDIRECTV under transition service agreements.\\n•Parent administration support , which includes costs\\nborne by AT&T where the business units do notinfluence decision making.\\n•Securitization fees associated with our sales of\\nreceivables (see Note 17).\\n•Value portfolio , which are businesses no longer\\nintegral to our operations or which we no longeractively market.\\nOther items consist of:\\n•Video, which includes our former U.S. video operations\\nthat were contributed to DIRECTV on July 31, 2021, andour share of DIRECTV’s earnings as equity in netincome of affiliates (see Note 19).•Held-for-sale and other reclassifications, which\\nincludes our former Crunchyroll, GovernmentSolutions and wireless and wireline operations inPuerto Rico and the U.S. Virgin Islands .',\n", " 'Virgin Islands .\\n•Reclassification of prior service credits, which includes\\nthe reclassification of prior service creditamortization, where we present the impact of benefitplan amendments in our business unit results. Priorservice credit amortization is presented in “Otherincome (expense) – net” in the consolidatedstatements of income and therefore has no impact onconsolidated operating income or EBITDA.\\n•Certain significant items , which includes items\\nassociated with the merger and integration ofacquired or divested businesses, includingamortization of intangible assets, employeeseparation charges associated with voluntary and/orstrategic offers, asset impairments andabandonments and restructuring, and other items forwhich the segments are not being evaluated.\\n• Eliminations and consolidations , removed transactions\\ninvolving dealings between Mobility and our Videobusiness, prior to the July 31, 2021 separation of Video.\\n“Interest expense” and “Other income (expense) – net” are\\nmanaged only on a total company basis and are,accordingly, reflected only in consolidated results.\\nFor the year ended December 31,',\n", " 'For the year ended December 31, 2022\\nRevenuesOperations\\nand Support\\nExpenses EBITDADepreciation\\nand\\nAmortizationOperating\\nIncome\\n(Loss)\\nCommunications\\nMobility $ 81,780 $ 49,054 $ 32,726 $ 8,198 $ 24,528\\nBusiness Wireline 22,538 13,972 8,566 5,314 3,252\\nConsumer Wireline 12,749 8,253 4,496 3,169 1,327\\nTotal Communications 117,067 71,279 45,788 16,681 29,107\\nLatin America - Mexico 3,144 2,812 332 658 (326)Segment Total 120,211 74,091 46,120 17,339 28,781\\nCorporate and Other\\nCorporate:\\nDTV-related retained costs 8 737 (729) 549 (1,278)\\nParent administration support (32) 1,199 (1,231) 16 (1,',\n", " '199 (1,231) 16 (1,247)\\nSecuritization fees 65 419 (354) — (354)\\nValue portfolio 489 139 350 41 309\\nTotal Corporate 530 2,494 (1,964) 606 (2,570)\\nReclassification of prior service credits — 2,691 (2,691) — (2,691)\\nCertain significant items — 28,031 (28,031) 76 (28,107)\\nTotal Corporate and Other 530 33,216 (32,686) 682 (33,368)\\nAT&T Inc. $ 120,741 $ 107,307 $ 13,434 $ 18,021 $ (4,587)\\n:,',\n", " 'For the year ended December 31, 2021\\nRevenuesOperations\\nand Support\\nExpenses EBITDADepreciation\\nand\\nAmortizationOperating\\nIncome\\n(Loss)\\nCommunications\\nMobility $ 78,254 $ 46,762 $ 31,492 $ 8,122 $ 23,370Business Wireline 23,937 14,718 9,219 5,192 4,027Consumer Wireline 12,539 8,448 4,091 3,095 996\\nTotal Communications 114,730 69,928 44,802 16,409 28,393Latin America - Mexico 2,747 2,652 95 605 (510)\\nSegment Total 117,477 72,580 44,897 17,014 27,883Corporate and Other\\nCorporate:\\nDTV-related retained costs 49 243 (194) 236 (430)Parent administration support (18) 1,523 (1,541) 36 (1,',\n", " '523 (1,541) 36 (1,577)Securitization fees 61 89 (28) — (28)Value portfolio 639 208 431 40 391\\nTotal Corporate 731 2,063 (1,332) 312 (1,644)Video 15,513 12,666 2,847 356 2,491Held-for-sale and other reclassifications 453 310 143 — 143Reclassification of prior service credits — 2,680 (2,680) — (2,680)Certain significant items — 126 (126) 170 (296)Eliminations and consolidations (136) (136) — — —\\nTotal Corporate and Other 16,561 17,709 (1,148) 838 (1,986)AT&T Inc. $ 134,038 $ 90,289 $ 43,749 $ 17,852 $ 25,897\\nFor the year ended December 31, 2020\\nRevenuesOperations\\nand Support\\nExpenses EBITDADepreciation\\nand\\nAmortizationOperating\\nIncome\\n(Loss)\\nCommunications\\nMobility $ 72,',\n", " '564 $ 41,677 $ 30,887 $ 8,086 $ 22,801Business Wireline 25,083 15,068 10,015 5,216 4,799Consumer Wireline 12,318 7,942 4,376 2,914 1,462\\nTotal Communications 109,965 64,687 45,278 16,216 29,062Latin America - Mexico 2,562 2,636 (74) 513 (587)\\nSegment Total 112,527 67,323 45,204 16,729 28,475Corporate and Other\\nCorporate:\\nParent administration support (62) 1,681 (1,743) 12 (1,755)Securitization fees 53 72 (19) — (19)Value portfolio 775 335 440 64 376\\nTotal Corporate 766 2,088 (1,322) 76 (1,398)Video 28,610 24,174 4,436 2,262 2,174Held-for-sale and other reclassifications 1,',\n", " '262 2,174Held-for-sale and other reclassifications 1,414 718 696 15 681Reclassification of prior service credits — 2,442 (2,442) — (2,442)Certain significant items — 15,677 (15,677) 3,441 (19,118)Eliminations and consolidations (267) (267) — — —\\nTotal Corporate and Other 30,523 44,832 (14,309) 5,794 (20,103)AT&T Inc. $ 143,050 $ 112,155 $ 30,895 $ 22,523 $ 8,372Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n:;',\n", " 'The following table is a reconciliation of operating income (loss) to “Income (Loss) from Continuing Operations Before\\nIncome Taxes” reported in our consolidated statements of income:\\n2022 2021 2020\\nCommunications $ 29,107 $ 28,393 $ 29,062\\nLatin America (326) (510) (587)\\nSegment Operating Income 28,781 27,883 28,475\\nReconciling Items:\\nCorporate (2,570) (1,644) (1,398)\\nVideo — 2,491 2,174\\nHeld-for-sale and other reclassifications — 143 681\\nTransaction and other costs (425) (41) (1,064)\\nAmortization of intangibles acquired (76) (170) (3,427)\\nAsset impairments and abandonments and restructuring (27,498) (213) (15,687)\\nGain on spectrum transaction1— — 900\\nBenefit-related gains (losses) (108) 128 160\\nReclassification of prior service credits (2,691) (2,680) (2,442)\\nAT&T Operating Income (Loss) (4,587) 25,897 8,',\n", " '587) 25,897 8,372\\nInterest Expense 6,108 6,716 7,727\\nEquity in net income of affiliates 1,791 603 89\\nOther income (expense) – net 5,810 9,387 (1,088)\\nIncome (Loss) from Continuing Operations Before Income Taxes $ (3,094) $ 29,171 $ (354)\\n1Included as a reduction of “Selling, general and administrative” expense in the consolidated statements of income.\\nThe following table sets forth revenues earned from customers, and property, plant and equipment located in different\\ngeographic areas:\\n2022 2021 2020\\nRevenuesNet Property,\\nPlant & Equipment RevenuesNet Property,\\nPlant & Equipment RevenuesNet Property,\\nPlant & Equipment\\nUnited States $ 116,006 $ 123,305 $ 129,157 $ 117,690 $ 138,188 $ 116,926\\nMexico 3,210 3,718 2,824 3,460 2,651 3,',\n", " '210 3,718 2,824 3,460 2,651 3,528\\nAsia/Pacific Rim 592 124 747 136 816 170\\nEurope 584 201 907 249 1,022 347\\nLatin America 217 74 251 82 212 94\\nOther 132 23 152 32 161 39\\nTotal $ 120,741 $ 127,445 $ 134,038 $ 121,649 $ 143,050 $ 121,104\\nThe following table presents assets, investments in equity affiliates and capital expenditures by segment:\\nAt or for the years ended December 31, 2022 2021\\nAssetsInvestments in\\nEquity Method\\nInvesteesCapital\\nExpenditures AssetsInvestments in\\nEquity Method\\nInvesteesCapital\\nExpenditures\\nCommunications $ 471,444 $ — $ 18,962 $ 448,757 $ — $ 14,691\\nLatin America 8,408 — 360 8,874 — 319\\nCorporate and eliminations1(76,999) 3,533 304 93,991 6,',\n", " '999) 3,533 304 93,991 6,168 535\\nTotal $ 402,853 $ 3,533 $ 19,626 $ 551,622 $ 6,168 $ 15,545\\n1Includes $119,776 of assets from discontinued operations at December 31, 2021.\\n:?',\n", " 'NOTE 5. REVENUE RECOGNITION\\nWe report our revenues net of sales taxes and record\\ncertain regulatory fees, primarily Universal Service Fund(USF) fees, on a net basis. No customer accounted formore than 10% of consolidated revenues in 2022, 2021 or2020.\\nWireless, Advanced Data, Legacy Voice & Data Services and\\nEquipment Revenue\\nWe offer service-only contracts and contracts that bundle\\nequipment used to access the services and/or with otherservice offerings. Some contracts have fixed terms andothers are cancellable on a short-term basis (i.e., month-to-month arrangements).\\nExamples of service revenues include wireless, strategic\\nservices (e.g., virtual private network service), and legacyvoice and data (e.g., traditional local and long-distance).These services represent a series of distinct services thatis considered a separate performance obligation. Servicerevenue is recognized when services are provided, basedupon either usage (e.g., minutes of traffic/bytes of dataprocessed) or period of time (e.g., monthly service fees).',\n", " 'Some of our services require customer premises\\nequipment that, when combined and integrated withAT&T’s specific network infrastructure, facilitates thedelivery of service to the customer. In evaluating whetherthe equipment is a separate performance obligation, weconsider the customer’s ability to benefit from theequipment on its own or together with other readilyavailable resources and if so, whether the service andequipment are separately identifiable (i.e., is the servicehighly dependent on, or highly interrelated with theequipment). When equipment is a separate performanceobligation, we record the sale of equipment when title haspassed and the products are accepted by the customer.For devices sold through indirect channels (e.g., nationaldealers), revenue is recognized when the dealer acceptsthe device, not upon activation.\\nOur equipment and service revenues are predominantly\\nrecognized on a gross basis, as most of our services donot involve a third party and we typically control theequipment that is sold to our customers.\\nRevenue recognized from fixed term contracts that\\nbundle services and/or equipment is allocated based onthe standalone selling price of all required performanceobligations of the contract (i.e., each item included in thebundle).',\n", " 'Promotional discounts are attributed to eachrequired component of the arrangement, resulting inrecognition over the contract term. Standalone selling\\nprices are determined by assessing prices paid for service-only contracts (e.g., arrangements where customers bringtheir own devices) and standalone device pricing.\\nWe offer the majority of our customers the option to\\npurchase certain wireless devices in installments over aspecified period of time, and, in many cases, they may beeligible to trade in the original equipment for a new deviceand have the remaining unpaid balance paid or settled. Forcustomers that elect these equipment installmentpayment programs, at the point of sale, we recognizerevenue for the entire amount of revenue allocated to thecustomer receivable net of fair value of the trade-in rightguarantee. The difference between the revenuerecognized and the consideration received is recorded asa note receivable when the devices are not discountedand our right to consideration is unconditional. Wheninstallment sales include promotional discounts (e.g., “buyone get one free” or equipment discounts with trade-in ofa device), the difference between revenue recognized andconsideration received is recorded as a contract asset tobe amortized over the contract term.',\n", " 'Less commonly, we offer certain customers highly\\ndiscounted devices when they enter into a minimumservice agreement term. For these contracts, werecognize equipment revenue at the point of sale basedon a standalone selling price allocation. The differencebetween the revenue recognized and the cash received isrecorded as a contract asset that will amortize over thecontract term.\\nOur contracts allow for customers to frequently modify\\ntheir arrangement, without incurring penalties in manycases. When a contract is modified, we evaluate thechange in scope or price of the contract to determine ifthe modification should be treated as a new contract or ifit should be considered a change of the existing contract.We generally do not have significant impacts fromcontract modifications.\\nRevenues from transactions between us and our\\ncustomers are recorded net of revenue-based regulatoryfees and taxes. Cash incentives given to customers arerecorded as a reduction of revenue. Nonrefundable,upfront service activation and setup fees associated withservice arrangements are deferred and recognized overthe associated service contract period or customerrelationship life.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n:!',\n", " 'Revenue Categories\\nThe following tables set forth reported revenue by category and by business unit :\\nFor the year ended December 31, 2022\\nCommunications\\nMobilityBusiness\\nWirelineConsumer\\nWirelineLatin\\nAmericaCorporate\\n& Other Elim.',\n", " 'Total\\nWireless service $ 60,499 $ — $ — $ 2,162 $ 13 $ — $ 62,674\\nBusiness service — 21,891 ———— 21,891\\nBroadband — — 9,669 — — — 9,669\\nLegacy voice and data — — 1,746 — 323 — 2,069\\nOther — — 1,334 — 194 — 1,528\\nTotal Service 60,499 21,891 12,749 2,162 530 — 97,831\\nEquipment 21,281 647 — 982 — — 22,910\\nTotal $ 81,780 $ 22,538 $ 12,749 $ 3,144 $ 530 $ — $ 120,741\\nFor the year ended December 31, 2021\\nCommunications\\nMobilityBusiness\\nWirelineConsumer\\nWirelineLatin\\nAmericaCorporate\\n& Other Elim.',\n", " 'Total\\nWireless service $ 57,590 $ — $ — $ 1,834 $ 74 $ — $ 59,498\\nVideo service ———— 1 5 , 4 2 3— 15,423\\nBusiness service — 23,224 — — 70 — 23,294Broadband — — 9,085 — — — 9,085Legacy voice and data — — 1,977 — 429 — 2,406Other — — 1,384 — 611 (136) 1,859\\nTotal Service 57,590 23,224 12,446 1,834 16,607 (136) 111,565\\nEquipment 20,664 713 93 913 90 — 22,473Total $ 78,254 $ 23,937 $ 12,539 $ 2,747 $ 16,697 $ (136) $ 134,038\\nFor the year ended December 31, 2020\\nCommunications\\nMobilityBusiness\\nWirelineConsumer\\nWirelineLatin\\nAmericaCorporate\\n& Other Elim.',\n", " 'Total\\nWireless service $ 55,542 $ — $ — $ 1,656 $ 528 $ — $ 57,726\\nVideo service ———— 2 8,465 — 28,465\\nBusiness service — 24,313 — — 314 — 24,627Broadband — — 8,534 — — — 8,534Legacy voice and data — — 2,213 — 554 — 2,767Other — — 1,564 — 641 (267) 1,938\\nTotal Service 55,542 24,313 12,311 1,656 30,502 (267) 124,057\\nEquipment 17,022 770 7 906 288 — 18,993Total $ 72,564 $ 25,083 $ 12,318 $ 2,562 $ 30,790 $ (267) $ 143,050\\n:¿',\n", " 'Deferred Customer Contract Acquisition and\\nFulfillment Costs\\nCosts to acquire and fulfill customer contracts, including\\ncommissions on service activations, for our Mobility,Business Wireline and Consumer Wireline services, aredeferred and amortized over the contract period orexpected customer relationship life, which typically rangesfrom three years to five years.\\nDuring the first quarter of 2022, we updated our analysis\\nof expected economic lives of customer relationships. Asof January 1, 2022, we extended the amortization periodfor deferred acquisition and fulfillment contract costswithin Mobility, Consumer Wireline and Business Wirelineto better reflect the estimated economic lives of therelationships. These changes in accounting estimatedecreased other cost of revenues approximately $395, or$0.04 per diluted share from continuing operations for theyear ended December 31, 2022.\\nThe following table presents the deferred customer\\ncontract acquisition and fulfillment costs included on ourconsolidated balance sheets at December 31:\\nConsolidated Balance Sheets 2022 2021\\nDeferred Acquisition Costs\\nPrepaid and other current\\nassets $ 2,893 $ 2,551\\nOther Assets 3,913 3,',\n", " '893 $ 2,551\\nOther Assets 3,913 3,247\\nTotal deferred customer contract\\nacquisition costs $6 , 8 0 6 $5 , 7 9 8\\nDeferred Fulfillment Costs\\nPrepaid and other current\\nassets $ 2,481 $ 2,600\\nOther Assets 4,206 4,148\\nTotal deferred customer contract\\nfulfillment costs $ 6,687 $ 6,748\\nThe following table presents deferred customer contract\\nacquisition and fulfillment cost amortization included in“Other cost of revenue” for the years ended December 31:\\nConsolidated Statements of Income 2022 20211\\nDeferred acquisition cost\\namortization $ 2,935 $ 2,965\\nDeferred fulfillment cost\\namortization 2,688 4,014\\n1Includes deferred acquisition amortization of $409 and deferred fulfillment cost\\namortization of $1,162 from our separated Video business for the year endedDecember 31, 2021.',\n", " '162 from our separated Video business for the year endedDecember 31, 2021.\\nContract Assets and Liabilities\\nA contract asset is recorded when revenue is recognized\\nin advance of our right to bill and receive consideration.The contract asset will decrease as services are providedand billed. For example, when installment sales includepromotional discounts (e.g., “buy one get one free”) thedifference between revenue recognized andconsideration received is recorded as a contract asset to\\nbe amortized over the contract term.\\nOur contract assets primarily relate to our wireless\\nbusinesses. Promotional equipment sales where we offerhandset credits, which are allocated between equipmentand service in proportion to their standalone selling prices,when customers commit to a specified service periodresult in additional contract assets recognized. Thesecontract assets will amortize over the service contractperiod, resulting in lower future service revenue.\\nWhen consideration is received in advance of the delivery\\nof goods or services, a contract liability is recorded.Reductions in the contract liability will be recorded as wesatisfy the performance obligations.',\n", " 'The following table presents contract assets and liabilities\\non our consolidated balance sheets at December 31:\\nConsolidated Balance Sheets 2022 2021\\nContract asset $ 5,512 $ 4,389\\nCurrent portion in “Prepaid and\\nother current assets” 2,941 2,582\\nContract liability 4,170 4,133\\nCurrent portion in “Advanced\\nbillings and customer deposits” 3,816 3,776\\nOur contract asset balance in 2022 reflects increased\\npromotional equipment sales in our wireless business. Weexpect the amortization of these promotional costs toflatten in 2023.\\nOur beginning of period contract liabilities recorded as\\ncustomer contract revenue during 2022 was $3,795.\\nRemaining Performance ObligationsRemaining performance obligations represent services we\\nare required to provide to customers under bundled ordiscounted arrangements, which are satisfied as servicesare provided over the contract term. In determining thetransaction price allocated, we do not include non-recurring charges and estimates for usage, nor do weconsider arrangements with an original expected durationof less than one year, which are primarily prepaid wirelessand residential internet agreements.',\n", " 'Remaining performance obligations associated with\\nbusiness contracts reflect recurring charges billed,adjusted to reflect estimates for sales incentives andrevenue adjustments. Performance obligations associatedwith wireless contracts are estimated using a portfolioapproach in which we review all relevant promotionalactivities, calculating the remaining performanceobligation using the average service component for theportfolio and the average device price. As of December 31,2022, the aggregate amount of the transaction priceallocated to remaining performance obligations was$35,800, of which we expect to recognizeapproximately 76% by the end of 2024, with the balancerecognized thereafter.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n,\\x08',\n", " 'NOTE 6. ACQUISITIONS, DISPOSITIONS AND OTHER\\nADJUSTMENTS\\nAcquisitionsSpectrum Auctions On January 14, 2022, the Federal\\nCommunications Commission (FCC) announced that wewere the winning bidder for 1,624 3.45 GHz licenses inAuction 110. We provided the FCC an upfront deposit of$123 in the third quarter of 2021 and paid the remaining$8,956 in the first quarter of 2022, for a total of $9,079. Wefunded the purchase price using cash and short-terminvestments. We received the licenses in May 2022 andclassified the auction deposits and related capitalizedinterest as “Licenses – Net” on our December 31, 2022consolidated balance sheet.',\n", " 'In February 2021, the FCC announced that AT&T was the\\nwinning bidder for 1,621 C-Band licenses, comprised of atotal of 80 MHz nationwide, including 40 MHz in Phase I.We provided to the FCC an upfront deposit of $550 in 2020and cash payments totaling $22,856 in the first quarter of2021, for a total of $23,406. We received the licenses in July2021 and classified the auction deposits, relatedcapitalized interest and billed relocation costs as “Licenses– Net” on our December 31, 2021 consolidated balancesheet. In December 2021, we paid $955 of IncentivePayments upon clearing of Phase I spectrum and estimatethat we will pay $2,112 upon clearing of Phase II spectrum,expected by the end of 2023. Additionally, we areresponsible for approximately $1,100 of compensablerelocation costs over the next several years as thespectrum is being cleared by satellite operators, of whichwe paid $650 in the fourth quarter of 2021 and $98 in thethird quarter of 2022.',\n", " 'Funding for the purchase price ofthe spectrum included a combination of cash on hand andshort-term investments, as well as short- and long-termdebt.\\nCash paid, including spectrum deposits (net of refunds),\\ncapitalized interest, and any payments for incentive andrelocation costs are included in “Acquisitions, net of cashacquired” on our consolidated statements of cash flows.Interest is capitalized until the spectrum is ready for itsintended use.\\nIn June 2020, we completed the acquisition of $2,379 of\\n37/39 GHz spectrum in an FCC auction. Prior to theauction, we exchanged the 39 GHz licenses with a bookvalue of approximately $300 that were previouslyacquired through FiberTower Corporation for vouchers tobe applied against the winning bids and recorded a $900gain in the first quarter of 2020. These vouchers yielded avalue of approximately $1,200, which was applied towardour gross bids.',\n", " 'In the second quarter of 2020, we made thefinal cash payment of $949, bringing the total cashpayment to $1,186.Dispositions\\nVideo Business On July 31, 2021, we closed our transaction\\nwith TPG to form a new company named DIRECTV, whichis jointly governed by a board with representation fromboth AT&T and TPG, with TPG having tie-breakingauthority on certain key decisions, most significantly theappointment and removal of the CEO.\\nIn connection with the transaction, we contributed our\\nU.S. Video business unit to DIRECTV for $4,250 of juniorpreferred units, an additional distribution preference of$4,200 and a 70% economic interest in common units(collectively “equity considerations”). TPG contributedapproximately $1,800 in cash to DIRECTV for $1,800 ofsenior preferred units and a 30% economic interest incommon units. See Note 10 for additional information onour accounting for our investment in DIRECTV.',\n", " 'See Note 10 for additional information onour accounting for our investment in DIRECTV.\\nUpon close of the transaction in the third quarter of 2021,\\nwe received approximately $7,170 in cash from DIRECTV($7,600, net of $430 cash on hand) and transferred $195 ofDIRECTV debt. Approximately $1,800 of the cash receivedis reported as cash received from financing activities inour consolidated statement of cash flows, as it relates to anote payable to DIRECTV, for which payment is tied to ouragreement to cover net losses under the remaining termof the NFL SUNDAY TICKET contract up to a cap of $2,100over the remaining period of the contract (see Note 19).The remainder of the net proceeds is reported as cashfrom investing activities. This transaction did not result ina material gain or loss.\\nIn the first quarter of 2021, we applied held-for-sale\\naccounting treatment to the assets and liabilities of theU.S. video business, and, accordingly, included the assets in“Prepaid and other current assets,” and the relatedliabilities in “Accounts payable and accrued liabilities,” onour consolidated balance sheet, up until the close of thetransaction.',\n", " 'The held-for-sale classification also resultedin ceasing depreciation and amortization on thedesignated assets.\\nThe assets and liabilities of the Video operations,\\ntransferred to DIRECTV upon close of the transaction,were as follows:\\nCurrent assets $ 4,893\\nProperty, plant and equipment – net 2,673\\nLicenses – net 5,798\\nOther intangible assets – net 1,634\\nOther assets 1,787\\nTotal Video assets $1 6 , 7 8 5\\nCurrent liabilities $ 4,267\\nLong-term debt 206\\nOther noncurrent liabilities 343\\nTotal Video liabilities $ 4,816\\n,',\n", " 'Central European Media Enterprises Ltd. (CME) On\\nOctober 13, 2020, we completed the sale of our 65.3%interest in CME, a European broadcasting company, forapproximately $1,100. This disposition did not result in amaterial gain or loss.\\nOperations in Puerto Rico On October 31, 2020, we\\ncompleted the sale of our wireless and wireline operationsin Puerto Rico and the U.S. Virgin Islands for approximately$1,950 and recorded a pre-tax loss of $82. The proceedswere used to redeem $1,950 of cumulative preferredinterests in a subsidiary that held notes secured by theproceeds of this sale.\\nDispositions Reflected as Discontinued OperationsWarnerMedia On April 8, 2022, we completed the\\nseparation and distribution of our WarnerMedia business,and merger of Spinco, an AT&T subsidiary formed to holdthe WarnerMedia business, with a subsidiary of Discovery,Inc., which was renamed Warner Bros. Discovery, Inc(WBD).',\n", " 'Discovery, Inc(WBD). Each AT&T shareholder was entitled to receive0.241917 shares of WBD common stock for each share ofAT&T common stock held as of the record date, whichrepresented approximately 71% of WBD. In connectionwith and in accordance with the terms of the Separationand Distribution Agreement (SDA), prior to thedistribution and merger, AT&T received approximately$40,400, which includes $38,800 of Spinco cash and $1,600of debt retained by WarnerMedia. During the secondquarter of 2022, assets of approximately $121,100 andliabilities of $70,600 were removed from our balancesheet as well as $45,041 of retained earnings and $5,632 ofadditional paid-in capital associated with the transaction.Additionally, in August 2022, we and WBD finalized thepost-closing adjustment, pursuant to Section 1.3 of theSDA, which resulted in a $1,200 payment to WBD in thethird quarter of 2022 and was reflected in the balancesheet as an adjustment to additional paid-in capital.',\n", " '(SeeNote 23)\\nAT&T, Spinco and Discovery entered into a Tax Matters\\nAgreement, which governs the parties’ rights,responsibilities and obligations with respect to taxliabilities and benefits, the preservation of the expectedtax-free status of the transactions contemplated by theSDA, and other matters regarding taxes.\\nXandr On June 6, 2022, we completed the sale of the\\nmarketplace component of Xandr to MicrosoftCorporation. Xandr was reflected in our historical financialstatements as discontinued operations.\\nVrio On November 15, 2021, we completed the sale of our\\nLatin America video operations, Vrio, to Grupo Wertheinand recorded a note receivable of $610 to be paid overfour years, of which $300 is in the form of seller financingand the remainder is related to working capitaladjustments.',\n", " 'In the second quarter of 2021, we classifiedthe Vrio disposal group as held-for-sale and reported thedisposal group at fair value less cost to sell, which resultedin a noncash, pre-tax impairment charge of $4,555,\\nincluding approximately $2,100 related to accumulatedforeign currency translation adjustments and $2,500related to property, plant and equipment and intangibleassets. Approximately $80 of the impairment wasattributable to noncontrolling interest. The assets andliabilities removed from our consolidated balance sheetincluded $851 of Vrio held-for-sale assets primarily relatedto deferred customer contract acquisition and fulfillmentcosts, prepaids and other deferred charges, and $2,872 ofrelated liabilities primarily for reserves associated withaccumulated foreign currency translation adjustments,which reversed against accumulated othercomprehensive income upon close of the transaction. Thisdisposition did not result in a net material gain or loss.\\nOtter Media During the third quarter of 2021, we disposed\\nof substantially all of the assets of Otter Media. Wereceived approximately $1,540 in cash and removedapproximately $1,200 of goodwill associated with theseassets. The dispositions did not result in a material gain orloss.',\n", " 'The dispositions did not result in a material gain orloss.\\nPlaydemic Ltd. On September 20, 2021, we sold\\nWarnerMedia’s mobile games app studio, Playdemic forapproximately $1,370 in cash and recognized a pre-taxgain of $706 in “Other income (expense) – net,” on ourconsolidated statement of income. Approximately $600of goodwill was removed related to this business.\\nNOTE 7.',\n", " 'Approximately $600of goodwill was removed related to this business.\\nNOTE 7. PROPERTY, PLANT AND EQUIPMENT\\nProperty, plant and equipment is summarized as follows\\nat December 31:\\nLives\\n(years) 2022 2021\\nLand – $ 1,381 $ 1,401\\nBuildings and improvements 2-44 38,751 38,204\\nCentral office equipment13-10 98,468 97,070\\nCable, wiring and conduit 15-50 84,447 79,961\\nSatellites 14-17 103 103\\nOther equipment 3-20 81,658 85,929\\nSoftware 3-7 17,640 16,520\\nUnder construction – 7,182 5,425\\n329,630 324,613\\nAccumulated depreciation\\nand amortization 202,185 202,964\\nProperty, plant\\nand equipment – net $127,445 $ 121,649\\n1Includes certain network software.\\nOur depreciation expense was $17,852 in 2022, $17,634 in\\n2021, and $19,028 in 2020.',\n", " 'Depreciation expense includedamortization of software totaling $2,972 in 2022, $2,909 in2021 and $3,343 in 2020.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n,',\n", " 'In December 2022, we recorded a noncash pre-tax charge\\nof $1,413 to abandon conduits that will not be utilized tosupport future network activity. The abandonment wasconsidered outside the ordinary course of business.\\nDuring the first quarter of 2022, we updated our analysis\\nof economic lives of AT&T owned fiber network assets. Asof January 1, 2022, we extended the estimated economiclife and depreciation period of such costs to better reflectthe physical life of the assets that we had beenexperiencing and absence of technological changes thatwould replace fiber as the best broadband technology inthe industry. The change in accounting estimatedecreased depreciation expense $280, or $0.03 per dilutedshare from continuing operations for the year endedDecember 31, 2022.\\nIn December 2020, we reassessed our grouping of long-\\nlived assets and identified certain impairment indicators,requiring us to evaluate the recoverability of the long-lived assets of our former Video business. Based on thisevaluation, we determined that these assets were notfully recoverable and recognized pre-tax impairmentcharges totaling $7,255, of which $1,681 related toproperty, plant and equipment, including satellites.',\n", " 'Thereduced carrying amounts of the impaired assets becametheir new cost basis.\\nNOTE 8. LEASES\\nWe have operating and finance leases for certain facilities\\nand equipment used in our operations. Our leasesgenerally have remaining lease terms of up to 15 years.Some of our real estate operating leases contain renewaloptions that may be exercised, and some of our leasesinclude options to terminate the leases within one year.\\nWe have recognized a right-of-use asset for both\\noperating and finance leases, and a corresponding leaseliability that represents the present value of our obligationto make payments over the lease term. The present valueof the lease payments is calculated using the incrementalborrowing rate for operating and finance leases, whichwas determined using a portfolio approach based on therate of interest that we would have to pay to borrow anamount equal to the lease payments on a collateralizedbasis over a similar term. We use the unsecured borrowingrate and risk-adjust that rate to approximate acollateralized rate in the currency of the lease, which willbe updated on a quarterly basis for measurement of newlease liabilities.\\nThe components of lease expense were as follows:\\n2022 2021 2020\\nOperating lease cost $ 5,',\n", " '437 $ 5,363 $ 5,331\\nFinance lease cost:\\nAmortization of\\nright-of-use assets $ 204 $ 179 $ 185\\nInterest on lease obligation 159 145 133\\nTotal finance lease cost $ 363 $ 324 $ 318The following table provides supplemental cash flows\\ninformation related to leases:\\n2022 2021 2020\\nCash Flows from Operating\\nActivities\\nCash paid for amounts\\nincluded in lease obligations:\\nOperating cash flows from\\noperating leases $ 4,679 $ 4,580 $ 4,496\\nSupplemental Lease Cash\\nFlow Disclosures\\nOperating lease right-of-use\\nassets obtained in exchange fornew operating lease obligations 3,751 3,396 4,057\\nThe following tables set forth supplemental balance sheet\\ninformation related to leases at December 31:\\n2022 2021\\nOperating Leases\\nOperating lease right-of-use assets $ 21,814 $ 21,824\\nAccounts payable and\\naccrued liabilities $ 3,547 $ 3,393\\nOperating lease obligation 18,659 18,956\\nTotal operating lease obligation $ 22,206 $ 22,',\n", " '659 18,956\\nTotal operating lease obligation $ 22,206 $ 22,349\\nFinance Leases\\nProperty, plant and equipment, at cost $ 2,770 $ 2,494\\nAccumulated depreciation\\nand amortization (1,224) (1,053)\\nProperty, plant and equipment – net $ 1,546 $ 1,441\\nCurrent portion of long-term debt $1 7 0 $ 127\\nLong-term debt 1,647 1,442\\nTotal finance lease obligation $ 1,817 $ 1,569\\n2022 2021\\nWeighted-Average Remaining Lease\\nTerm (years)\\nOperating leases 8.1 8.2\\nFinance leases 7.9 8.9\\nWeighted-Average Discount Rate\\nOperating leases 3.7 % 3.7 %\\nFinance leases 8.0 % 8.2 %\\n,',\n", " 'The following table provides the expected future\\nminimum maturities of lease obligations:\\nAt December 31, 2022Operating\\nLeasesFinance\\nLeases\\n2023 $ 4,657 $ 315\\n2024 4,203 306\\n2025 3,543 315\\n2026 2,830 291\\n2027 2,302 290\\nThereafter 8,933 1,032\\nTotal lease payments 26,468 2,549\\nLess: imputed interest (4,262) (732)\\nTotal $ 22,206 $ 1,817\\nNOTE 9. GOODWILL AND OTHER INTANGIBLE ASSETS\\nWe test goodwill for impairment at a reporting unit level,\\nwhich is deemed to be our principal operating segmentsor one level below. With our annual impairment testing asof October 1, 2022, the calculated fair value of the Mobilityreporting unit exceeded its book value; we recordednoncash impairment charges of $13,478 in our BusinessWireline reporting unit, $10,508 in our Consumer Wirelinereporting unit and $826 in our Mexico reporting unit.',\n", " 'The\\ndecline in fair values was primarily due to changes in themacroeconomic environment, namely increasedweighted-average cost of capital. Also, inflation pressureand lower projected cash flows driven by secular declines,predominantly at Business Wireline, impacted the fairvalues. A combination of discounted cash flow and marketmultiple approaches was used to determine the fairvalues. In the Communications segment, if all otherassumptions were to remain unchanged, we expect theimpairment charge would increase by approximately$3,400 if the weighted average cost of capital increasedby 25 basis points, or $2,100 if the projected terminalgrowth rate declined by 25 basis points, or $2,800 if theprojected long-term EBITDA margin declined 100 basispoints.\\nChanges to our goodwill in 2022 primarily resulted from\\nnoncash impairments. Changes to our goodwill in 2021primarily resulted from the sale of our GovernmentSolutions business.\\nAt December 31, 2022, our Communications segment has\\nthree reporting units: Mobility, Business Wireline andConsumer Wireline. The reporting unit is deemed to be theoperating segment for Latin America.',\n", " 'The reporting unit is deemed to be theoperating segment for Latin America.\\nThe following table sets forth the changes in the carrying amounts of goodwill by operating segment:\\n2022 2021\\nBalance at\\nJan. 1 ImpairmentsDispositions,\\ncurrency\\nexchange\\nand otherBalance at\\nDec. 31Balance at\\nJan. 1Dispositions,\\ncurrency\\nexchange\\nand otherBalance at\\nDec.',\n", " '1Dispositions,\\ncurrency\\nexchange\\nand otherBalance at\\nDec. 31\\nCommunications\\nGoodwill $ 91,924 $ — $ (43) $ 91,881 $ 91,976 $ (52) $ 91,924\\nImpairments — (23,986) — (23,986) ———\\nNet goodwill 91,924 (23,986) (43) 67,895 91,976 (52) 91,924\\nLatin America 816 (826) 10 — 836 (20) 816\\nTotal $ 92,740 $ (24,812) $ (33) $ 67,895 $ 92,812 $ (72) $ 92,740\\nWe review amortizing intangible assets for impairment whenever events or circumstances indicate that the carrying\\namount may not be recoverable over the remaining life of the asset or asset group.\\nIndefinite-lived wireless licenses increased in 2022 primarily due to recent auction activity and $1,120 of capitalized\\ninterest (see Note 6).\\nIn 2021, as a result of the separation of our U.S.',\n", " 'In 2021, as a result of the separation of our U.S. video business (see Note 6), we removed $5,798 of orbital slot licenses and\\n$1,585 of customer lists that were transferred to DIRECTV. Indefinite-lived wireless licenses increased in 2021 primarilydue to auction activity, compensable relocation and incentive payments, and capitalized interest (see Notes 6 and 22).Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n,:',\n", " 'Our other intangible assets at December 31 are summarized as follows:\\n2022 2021\\nOther Intangible AssetsWeighted-\\nAverage LifeGross\\nCarrying\\nAmountAccumulated\\nAmortizationCurrency\\nTranslation\\nAdjustmentGross\\nCarrying\\nAmountAccumulated\\nAmortizationCurrency\\nTranslation\\nAdjustment\\nAmortized intangible assets:\\nWireless licenses 21.6 years $ 3,045 $ 425 $ (297) $ 3,083 $ 307 $ (440)\\nTrademarks and trade names 15.0 years 26 11 (6) 27 11 (7)\\nCustomer lists and relationships 12.6 years 413 304 (75) 577 429 (98)\\nOther 8.5 years 304 234 — 349 258 —\\nTotal 21.1 years $ 3,788 $ 974 $ (378) $ 4,036 $ 1,005 $ (545)\\nIndefinite-lived intangible assets not subject to amortization:\\nWireless licenses $ 121,769 $ 111,494\\nTrade names 5,241 5,241\\nTotal $ 127,010 $ 116,',\n", " '241 5,241\\nTotal $ 127,010 $ 116,735\\nAmortized intangible assets are definite-life assets, and, as such, we record amortization expense based on a method\\nthat most appropriately reflects our expected cash flows from these assets. Amortization expense for definite-lifeintangible assets was $169 for the year ended December 31, 2022, $218 for the year ended December 31, 2021 (reflectingthe separation of our U.S. video business) and $3,495 for the year ended December 31, 2020. Estimated amortizationexpense for the next five years is: $161 for 2023, $154 for 2024, $142 for 2025, $142 for 2026 and $142 for 2027.\\nNOTE 10. EQUITY METHOD INVESTMENTS\\nInvestments in partnerships, joint ventures and less than\\nmajority-owned subsidiaries in which we have significantinfluence are accounted for under the equity method.\\nOn July 31, 2021, we closed our transaction with TPG to\\nform a new company named DIRECTV (see Note 6).',\n", " 'Thetransaction resulted in our deconsolidation of the Videobusiness, with DIRECTV being accounted for under theequity method beginning August 1, 2021.\\nOur investments in equity affiliates at December 31, 2022\\nprimarily included our interests in DIRECTV and SKYMexico.\\nDIRECTV We account for our investment in DIRECTV\\nunder the equity method of accounting. DIRECTV isconsidered a variable interest entity for accountingpurposes. As DIRECTV is jointly governed by a board withrepresentation from both AT&T and TPG, with TPG havingtie-breaking authority on certain key decisions, mostsignificantly the appointment and removal of the CEO, wehave concluded that we are not the primary beneficiary ofDIRECTV.The ownership interests in DIRECTV, based on seniority\\nare as follows:\\n• Preferred units with distribution rights of $1,800 held\\nby TPG, which were fully distributed in 2021.\\n• Junior preferred units with distribution rights of\\n$4,250 held by AT&T, of which $702 of distributionrights remain as of December 31, 2022.\\n• Distribution preference associated with Common\\nunits of $4,200 held by AT&T.',\n", " '• Distribution preference associated with Common\\nunits of $4,200 held by AT&T.\\n• Common units, with 70% held by AT&T and 30% held\\nby TPG.\\nThe initial fair value of the equity considerations on July 31,\\n2021 was $6,852, which was determined using adiscounted cash flow model reflecting distribution rightsand preference of the individual instruments. During 2022and 2021, we recognized $1,808 and $619 of equity in netincome of affiliates and received total distributions of$4,457 and $1,942, respectively, from DIRECTV. The bookvalue of our investment in DIRECTV was $2,911 and $5,539at December 31, 2022 and 2021.\\n,,',\n", " 'Our share of net income or loss may differ from the\\nstated ownership percentage interest of DIRECTV as theterms of the arrangement prescribe substantive non-proportionate cash distributions, both from operationsand in liquidation, that are based on classes of interestsheld by investors. In the event that DIRECTV records aloss, that loss will be allocated to ownership interestsbased on their seniority, beginning with the mostsubordinated interests.\\nSKY Mexico We hold a 41.3% interest in SKY Mexico, which\\nis a leading pay-TV provider in Mexico.',\n", " 'The following table presents summarized financial\\ninformation for DIRECTV and our other equity methodinvestments, consisting primarily of SKY Mexico andcertain sports-related programming investments, atDecember 31, or for the year then ended:\\n2022 2021 2020\\nIncome Statements1\\nOperating revenues $2 5 , 7 9 4 $ 12,220 $ 1,282\\nOperating income 3,175 1,179 157\\nNet income 2,581 938 91\\nBalance Sheets\\nCurrent assets 4,240 5,295\\nNoncurrent assets 14,211 17,022\\nCurrent liabilities 6,681 7,191\\nNoncurrent liabilities 7,951 8,614\\n1Does not include DIRECTV for periods prior to August 1, 2021.',\n", " 'The following table is a reconciliation of our investments\\nin equity affiliates as presented on our consolidatedbalance sheets:\\n2022 2021\\nBeginning of year $ 6,168 $ 742\\nAdditional investments 3 —\\nReceipt of equity interest in DIRECTV — 6,852\\nDistributions from DIRECTV in excess\\nof cumulative equity in earnings (2,649) (1,323)\\nOther capital distributions — (6)\\nDividends and distributions of\\ncumulative earnings received (1,815) (701)\\nEquity in net income of affiliates 1,791 603\\nCurrency translation adjustments 25 (14)\\nOther adjustments 10 15\\nEnd of year $3 , 5 3 3 $ 6,168NOTE 11. DEBT\\nLong-term debt of AT&T and its subsidiaries, including\\ninterest rates and maturities, is summarized as follows atDecember 31:\\n2022 2021\\nNotes and debentures\\nInterest Rates1Maturities\\n0.00% – 2.99% 2022 – 2039 $ 24,603 $ 31,612\\n3.00% – 4.99% 2022 – 2061 91,',\n", " '00% – 4.99% 2022 – 2061 91,201 107,635\\n5.00% – 6.99% 2022 – 2095 20,083 23,023\\n7.00% – 12.00% 2022 – 2097 4,884 5,056\\nCredit agreement borrowings 2,500 10,400\\nFair value of interest rate swaps\\nrecorded in debt 13 16\\n143,284 177,742\\nUnamortized (discount) premium – net (9,650) (9,758)\\nUnamortized issuance costs (427) (508)\\nTotal notes and debentures 133,207 167,476\\nFinance lease obligations 1,817 1,569\\nTotal long-term debt, including\\ncurrent maturities 135,024 169,045\\nCurrent maturities of long-term debt (6,601) (7,934)\\nCurrent maturities of credit\\nagreement borrowings — (10,100)\\nTotal long-term debt $ 128,423 $ 151,011\\n1Foreign debt includes the impact from hedges, when applicable.',\n", " '011\\n1Foreign debt includes the impact from hedges, when applicable.\\nWe had outstanding Euro, British pound sterling, Canadian\\ndollar, Mexican peso, Australian dollar, and Swiss francdenominated debt of approximately $35,525 and $41,063at December 31, 2022 and 2021, respectively.\\nThe weighted-average interest rate of our long-term debt\\nportfolio, including credit agreement borrowings and theimpact of derivatives, was approximately 4.1% as ofDecember 31, 2022 and 3.8% as of December 31, 2021.\\nDebt maturing within one year consisted of the following\\nat December 31:\\n2022 2021\\nCurrent maturities of long-term debt $ 6,601 $7 , 9 3 4\\nCommercial paper 866 6,586\\nCredit agreement borrowings — 10,100\\nTotal $ 7,467 $ 24,620Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n,;',\n", " 'Financing Activities\\nDuring 2022, we received net proceeds of $479 on the issuance of $479 in long-term debt and proceeds of $3,250 on the\\nissuance of credit agreement borrowings in various markets, with an average weighted maturity of approximately 2.0years and a weighted average interest rate of 5.2%. We repaid $34,835 of long-term debt and credit agreementborrowings with a weighted average interest rate of 3.1%. Our debt activity during 2022 primarily consisted of thefollowing:\\nFirst\\nQuarterSecond\\nQuarterThird\\nQuarterFourth\\nQuarterFull Year\\n2022\\nNet commercial paper borrowings $ 1,471 $ (5,219) $ (724) $ (1,337) $ (5,809)\\nIssuance of Notes and Debentures:\\nPrivate Financing $ — $ — $ 750 $ — $ 7502025 Term Loan — — — 2,500 2,500Other 479 — — — 479\\nDebt Issuances $ 479 $ — $ 750 $ 2,500 $ 3,729Repayments:\\n2021 Syndicated Term Loan $ — $ (7,',\n", " '729Repayments:\\n2021 Syndicated Term Loan $ — $ (7,350) $ — $ — $ (7,350)BAML Bilateral Term Loan – Tranche A — (1,000) — — (1,000)Private financing — (750) — (750) (1,500)\\nRepayments of other short-term borrowings $ — $ (9,100) $ — $ (750) $ (9,850)\\nUSD notes\\n1,2,3$ (123) $ (18,957) $ — $ (287) $ (19,367)\\nEuro notes — (3,343) — — (3,343)BAML Bilateral Term Loan – Tranche B — (1,000) — — (1,000)Other (667) (123) (199) (419) (1,408)\\nRepayments of long-term debt $ (790) $(23,423) $ (199) $ (706) $ (25,118)\\n1On April 11, 2022, we issued notices for the redemption in full of all of the outstanding approximately $9,',\n", " 'we issued notices for the redemption in full of all of the outstanding approximately $9,042 aggregate principal amount of various gl obal notes due 2022\\nto 2026 with coupon rates ranging from 2.625% to 4.450% (Make-Whole Notes). The Make-Whole Notes were redeemed on the redemption dates set forth in the notices\\nof redemption, at “make whole” redemption prices calculated as set forth in the respective redemption notices in the second quarter.\\n2Includes $7,954 of cash paid toward the $8,822 aggregate principal amount of various notes that were tendered for cash in May 2022. The notes had intere st rates\\nranging between 3.100% and 8.750% and original maturities ranging from 2026 to 2061.\\n3Includes $287 of principal repayment on a $592 zero coupon note that matured in November 2022. The other $305 was applied to operating cash flows relate dt o\\ninterest expense that accreted to the note over its life.\\nAs of December 31, 2022 and 2021, we were in compliancewith all covenants and conditions of instrumentsgoverning our debt.',\n", " 'Substantially all of our outstandinglong-term debt is unsecured. Maturities of outstandinglong-term notes and debentures, as of December 31, 2022,and the corresponding weighted-average interest ratescheduled for repayment are as follows:\\n2023 2024 2025 2026 2027There-\\nafter\\nDebtrepayments\\n1$6,929 $8,950 $5,948 $8,619 $6,278 $110,949\\nWeighted-\\naverageinterest rate\\n23.7 % 4.1 % 5.5 % 3.1 % 3.7 % 4.2 %\\n1Debt repayments represent maturity value. Foreign debt includes the impact\\nfrom hedges, when applicable. Includes credit agreement borrowings.\\n2Includes credit agreement borrowings.Credit Facilities\\nGeneralOn January 29, 2021, we entered into a $14,700 Term Loan\\nCredit Agreement (2021 Syndicated Term Loan), with Bankof America, N.A., as agent.',\n", " 'On March 23, 2021, we borrowed$7,350 under the 2021 Syndicated Term Loan and theremaining $7,350 of lenders’ commitments wasterminated. In the first quarter of 2022, the maturity dateof the 2021 Syndicated Term Loan was extended toDecember 31, 2022. On April 13, 2022, the 2021 SyndicatedTerm Loan was paid off and terminated.\\nIn March 2021, we entered into and drew on a $2,000 term\\nloan credit agreement (BAML Bilateral Term Loan)consisting of (i) a $1,000 facility originally due December31, 2021 (BAML Tranche A Facility) and subsequentlyextended to December 31, 2022 in the fourth quarter of2021, and (ii) a $1,000 facility due December 31, 2022 (BAMLTranche B Facility), with Bank of America, N.A., as agent.On April 13, 2022, the BAML Bilateral Term Loan was paidoff and terminated.\\n,?',\n", " 'In November 2022, we entered into and drew on a $2,500\\nterm loan agreement due February 16, 2025 (2025 TermLoan), with Mizuho Bank, Ltd., as agent. As of December 31,2022, $2,500 was outstanding under this agreement.\\nRevolving Credit AgreementsIn November 2022, we terminated one of our revolving\\ncredit agreements and amended and restated the other.We currently have one $12,000 revolving credit agreementthat terminates on November 18, 2027 (Revolving CreditAgreement). No amounts were outstanding as ofDecember 31, 2022.\\nEach of our credit and loan agreements contains\\ncovenants that are customary for an issuer with aninvestment grade senior debt credit rating. Our RevolvingCredit Agreement and 2025 Term Loan include a net debt-to-EBITDA financial ratio covenant requiring AT&T tomaintain, as of the last day of each fiscal quarter, a ratio ofnot more than 3.75-to-1.',\n", " 'Other loan agreements include anet debt-to-EBITDA financial ratio covenant requiringAT&T to maintain, as of the last day of each fiscal quarterthrough June 30, 2023 a ratio of not more than 4.0-to-1,and a ratio of not more than 3.5-to-1 for any fiscal quarterthereafter.\\nThe events of default are customary for agreements of\\nthis type and such events would result in the accelerationof, or would permit the lenders to accelerate, asapplicable, required payments and would increase eachagreement’s relevant Applicable Margin by 2.00% perannum.\\nThe obligations of the lenders under the Revolving Credit\\nAgreement to provide advances will terminate onNovember 18, 2027, unless the commitments areterminated in whole prior to that date. All advances mustbe repaid no later than the date on which lenders are nolonger obligated to make any advances under theRevolving Credit Agreement.\\nThe Revolving Credit Agreement provides that we and\\nlenders representing more than 50% of the facilityamount may agree to extend their commitments underthe credit agreement for two one-year periods beyondthe initial termination date. We have the right toterminate,',\n", " 'We have the right toterminate, in whole or in part, amounts committed by thelenders under the credit agreement in excess of anyoutstanding advances; however, any such terminatedcommitments may not be reinstated.Advances under the Revolving Credit Agreement would\\nbear interest, at our option, either:\\n• at a variable annual rate equal to: (1) the highest of\\n(but not less than zero) (a) the rate of interestannounced publicly by Citibank in New York, NewYork, from time to time, as Citibank’s base rate, (b)0.5% per annum above the federal funds rate, and (c)the forward-looking term rate\\nbased on the secured\\novernight financing rate (“Term SOFR”) for a period ofone month plus a credit spread adjustment of 0.10%plus 1.00%, plus (2) an applicable margin, as set forthin the credit agreement (the “Applicable Margin forBase Advances”); or\\n• at a rate equal to: (i) Term SOFR for a period of one,\\nthree or six months, as applicable, plus (ii) a creditspread adjustment of 0.',\n", " 'as applicable, plus (ii) a creditspread adjustment of 0.10% plus (iii) an applicablemargin, as set forth in the Revolving CreditAgreement (the “Applicable Margin for BenchmarkRate Advances”).\\nWe pay a facility fee of 0.060%, 0.070%, 0.080% or 0.100%\\nper annum of the amount of the lender commitments,depending on AT&T’s credit rating.\\nNOTE 12. FAIR VALUE MEASUREMENTS AND\\nDISCLOSURE\\nThe Fair Value Measurement and Disclosure framework in\\nASC 820, “Fair Value Measurement,” provides a three-tiered fair value hierarchy based on the reliability of theinputs used to determine fair value. Level 1 refers to fairvalues determined based on quoted prices in activemarkets for identical assets. Level 2 refers to fair valuesestimated using significant other observable inputs andLevel 3 includes fair values estimated using significantunobservable inputs.\\nThe level of an asset or liability within the fair value\\nhierarchy is based on the lowest level of any input that issignificant to the fair value measurement. Our valuationtechniques maximize the use of observable inputs andminimize the use of unobservable inputs.',\n", " 'Our valuationtechniques maximize the use of observable inputs andminimize the use of unobservable inputs.\\nThe valuation methodologies described above may\\nproduce a fair value calculation that may not be indicativeof future net realizable value or reflective of future fairvalues. We believe our valuation methods are appropriateand consistent with other market participants. The use ofdifferent methodologies or assumptions to determine thefair value of certain financial instruments could result in adifferent fair value measurement at the reporting date.There have been no changes in the methodologies usedsince December 31, 2021.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n,!',\n", " 'Long-Term Debt and Other Financial Instruments\\nThe carrying amounts and estimated fair values of our long-term debt, including current maturities, and other financial\\ninstruments, are summarized as follows:\\nDecember 31, 2022 December 31, 2021\\nCarrying\\nAmountFair\\nValueCarrying\\nAmountFair\\nValue\\nNotes and debentures1$ 133,207 $ 122,524 $ 167,476 $ 193,068\\nCommercial paper 866 866 6,586 6,586\\nInvestment securities22,692 2,692 3,214 3,214\\n1Includes credit agreement borrowings. Excludes note payable to DIRECTV.\\n2Excludes investments accounted for under the equity method.\\nThe carrying amount of debt with an original maturity of less than one year approximates fair value. The fair value\\nmeasurements used for notes and debentures are considered Level 2 and are determined using various methods,including quoted prices for identical or similar securities in both active and inactive markets.\\nFollowing is the fair value leveling for investment securities that are measured at fair value and derivatives as of\\nDecember 31, 2022 and December 31, 2021.',\n", " 'Derivatives designated as hedging instruments are reflected as “OtherAssets,” “Other noncurrent liabilities,” “Prepaid and other current assets” and “Accounts payable and accrued liabilities” onour consolidated balance sheets.',\n", " 'December 31, 2022\\nLevel 1 Level 2 Level 3 Total\\nEquity Securities\\nDomestic equities $ 995 $ — $ — $ 995\\nInternational equities 198 — — 198\\nFixed income equities 189 — — 189\\nAvailable-for-Sale Debt Securities — 1,132 — 1,132\\nAsset Derivatives\\nCross-currency swaps —2 8—2 8\\nLiability Derivatives\\nCross-currency swaps — (6,010) — (6,010)\\nForeign exchange contracts — (23) — (23)\\nDecember 31, 2021\\nLevel 1 Level 2 Level 3 Total\\nEquity Securities\\nDomestic equities $ 1,213 $ — $ — $ 1,213International equities 221 — — 221Fixed income equities 219 — — 219\\nAvailable-for-Sale Debt Securities — 1,380 — 1,380Asset Derivatives\\nCross-currency swaps — 211 — 211\\nLiability Derivatives\\nCross-currency swaps — (3,170) — (3,170)\\n,¿',\n", " 'Investment Securities\\nOur investment securities include both equity and debt\\nsecurities that are measured at fair value, as well as equitysecurities without readily determinable fair values. Asubstantial portion of the fair values of our investmentsecurities is estimated based on quoted market prices.Investments in equity securities not traded on a nationalsecurities exchange are valued at cost, less anyimpairment, and adjusted for changes resulting fromobservable, orderly transactions for identical or similarsecurities. Investments in debt securities not traded on anational securities exchange are valued using pricingmodels, quoted prices of securities with similarcharacteristics or discounted cash flows.',\n", " 'The components comprising total gains and losses in the\\nperiod on equity securities are as follows:\\nFor the years ended December 31, 2022 2021 2020\\nTotal gains (losses) recognized\\non equity securities $ (309) $ 293 $ 171\\nGains (Losses) recognized\\non equity securities sold (80) (5) (25)\\nUnrealized gains (losses)\\nrecognized on equity securitiesheld at end of period $ (229) $ 298 $ 196\\nAt December 31, 2022, available-for-sale debt securities\\ntotaling $1,132 have maturities as follows - less than oneyear: $38; one to three years: $158; three to five years:$170; five or more years: $766.\\nOur cash equivalents (money market securities), short-\\nterm investments (certificate and time deposits) andnonrefundable customer deposits are recorded atamortized cost, and the respective carrying amountsapproximate fair values. Short-term investments andnonrefundable customer deposits are recorded in“Prepaid and other current assets” and our investmentsecurities are recorded in “Other Assets” on theconsolidated balance sheets.',\n", " 'Derivative Financial Instruments\\nWe enter into derivative transactions to manage certain\\nmarket risks, primarily interest rate risk and foreigncurrency exchange risk. This includes the use of interestrate swaps, interest rate locks, foreign exchange forwardcontracts and combined interest rate foreign exchangecontracts (cross-currency swaps). We do not usederivatives for trading or speculative purposes. We recordderivatives on our consolidated balance sheets at fairvalue that is derived from observable market data,including yield curves and foreign exchange rates (all ofour derivatives are Level 2). Cash flows associated withderivative instruments are presented in the samecategory on the consolidated statements of cash flows asthe item being hedged.Fair Value Hedging Periodically, we enter into and\\ndesignate fixed-to-floating interest rate swaps as fairvalue hedges. The purpose of these swaps is to manageinterest rate risk by managing our mix of fixed-rate andfloating-rate debt. These swaps involve the receipt offixed-rate amounts for floating interest rate paymentsover the life of the swaps without exchange of theunderlying principal amount.\\nWe also designate most of our cross-currency swaps and\\nforeign exchange contracts as fair value hedges.',\n", " 'Thepurpose of these contracts is to hedge foreign currencyrisk associated with changes in spot rates on foreigndenominated debt. For cross-currency hedges, we haveelected to exclude the change in fair value of the swaprelated to both time value and cross-currency basisspread from the assessment of hedge effectiveness. Forforeign exchange contracts, we have elected to excludethe change in fair value of forward points from theassessment of hedge effectiveness.\\nUnrealized and realized gains or losses from fair value\\nhedges impact the same category on the consolidatedstatements of income as the item being hedged, includingthe earnings impact of excluded components. In instanceswhere we have elected to exclude components from theassessment of hedge effectiveness related to fair valuehedges, unrealized gains or losses on such excludedcomponents are recorded as a component ofaccumulated OCI and recognized into earnings over thelife of the hedging instrument. Unrealized gains onderivatives designated as fair value hedges are recordedat fair value as assets, and unrealized losses are recordedat fair market value as liabilities.',\n", " 'Except for excludedcomponents, changes in the fair value of derivativeinstruments designated as fair value hedges are offsetagainst the change in fair value of the hedged assets orliabilities through earnings. In the years endedDecember 31, 2022 and 2021, no ineffectiveness wasmeasured on fair value hedges.\\nCash Flow Hedging We designated some of our cross-\\ncurrency swaps as cash flow hedges to hedge ourexposure to variability in expected future cash flows thatare attributable to foreign currency risk generated fromour foreign-denominated debt. These agreements includeinitial and final exchanges of principal from fixed foreigncurrency denominated amounts to fixed U.S. dollardenominated amounts, to be exchanged at a specifiedrate that is usually determined by the market spot rateupon issuance. They also include an interest rate swap of afixed or floating foreign currency-denominated interestrate to a fixed U.S. dollar denominated interest rate.\\nOn September 30, 2022, we de-designated most of our\\ncross-currency swaps from cash flow hedges and re-designated these swaps as fair value hedges.',\n", " 'The amountremaining in accumulated other comprehensive lossrelated to cash flow hedges on the de-designation datewas $1,857. The amount will be reclassified to earningsNotes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n;\\x08',\n", " 'when the hedged item is recognized in earnings or when it\\nbecomes probable that the forecasted transactions willnot occur. The election of fair value hedge designation forcross-currency swaps does not have an impact on ourfinancial results.\\nUnrealized gains on derivatives designated as cash flow\\nhedges are recorded at fair value as assets, and unrealizedlosses are recorded at fair value as liabilities. For derivativeinstruments designated as cash flow hedges, changes infair value are reported as a component of accumulatedOCI and are reclassified into the consolidated statementsof income in the same period the hedged transactionaffects earnings.\\nPeriodically, we enter into and designate interest rate\\nlocks to partially hedge the risk of changes in interestpayments attributable to increases in the benchmarkinterest rate during the period leading up to the probableissuance of fixed-rate debt. We designate our interest ratelocks as cash flow hedges. Gains and losses when wesettle our interest rate locks are amortized into incomeover the life of the related debt. Over the next 12 months,we expect to reclassify $59 from accumulated OCI to“Interest expense” due to the amortization of net losseson historical interest rate locks.',\n", " 'Collateral and Credit-Risk Contingency We have entered\\ninto agreements with our derivative counterpartiesestablishing collateral thresholds based on respectivecredit ratings and netting agreements. At December 31,2022, we had posted collateral of $886 (a deposit asset)and held collateral of $0 (a receipt liability). Under theagreements, if AT&T’s credit rating had been downgradedtwo ratings levels by Fitch Ratings, one level by S&P andone level by Moody’s, before the final collateral exchangein December, we would have been required to postadditional collateral of $42. If AT&T’s credit rating hadbeen downgraded three ratings levels by Fitch Ratings,two levels by S&P, and two levels by Moody’s, we wouldhave been required to post additional collateral of $5,728.At December 31, 2021, we had posted collateral of $135 (adeposit asset) and held collateral of $7 (a receipt liability).We do not offset the fair value of collateral, whether theright to reclaim cash collateral (a receivable) or theobligation to return cash collateral (a payable) exists,against the fair value of the derivative instruments.',\n", " 'Following are the notional amounts of our outstanding\\nderivative positions at December 31:\\n2022 2021\\nCross-currency swaps $ 38,213 $ 40,737\\nForeign exchange contracts 617 —\\nTotal $ 38,830 $ 40,737Following are the related hedged items affecting our\\nfinancial position and performance:\\nEffect of Derivatives on theConsolidated Statements of Income\\nFair Value Hedging RelationshipsFor the years ended December 31, 2022 2021 2020\\nInterest rate swaps\\n(Interest expense):\\nGain (Loss) on interest rate\\nswaps $( 3 ) $ (4) $ (6)\\nGain (Loss) on long-term debt 3 46\\nCross-currency swaps:\\nGain (Loss) on cross-currency\\nswaps 2,195 (91) —\\nGain (Loss) on long-term debt (2,',\n", " '195 (91) —\\nGain (Loss) on long-term debt (2,195) 91 —\\nGain (Loss) recognized in\\naccumulated OCI 297 (17) —\\nForeign exchange contracts:\\nGain (Loss) on foreign exchange\\ncontracts (12) ——\\nGain (Loss) on long-term debt 12 ——\\nGain (Loss) recognized in\\naccumulated OCI (12) ——\\nIn addition, the net swap settlements that accrued and\\nsettled in the periods above were offset against “Interestexpense.”\\nCash Flow Hedging RelationshipsFor the years ended December 31, 2022 2021 2020\\nCross-currency swaps:\\nGain (Loss) recognized in\\naccumulated OCI $ (1,',\n", " '119) $ (873) $ (378)\\nForeign exchange contracts:\\nGain (Loss) recognized in\\naccumulated OCI 3 (17) 3\\nOther income (expense) –\\nnet reclassified from\\naccumulated OCI into income 1 1( 3 )\\nInterest rate locks:\\nGain (Loss) recognized in\\naccumulated OCI — — (648)\\nInterest income (expense)\\nreclassified from accumulatedOCI into income (65) (92) (84)\\nOther income (expense) –\\nnet reclassified from\\naccumulated OCI into income (45) ——\\nDistribution of WarnerMedia (12) ——\\n;',\n", " 'Nonrecurring Fair Value Measurements\\nIn addition to assets and liabilities that are recorded at fair\\nvalue on a recurring basis, impairment indicators maysubject goodwill and long-lived assets to nonrecurring fairvalue measurements. The implied fair values of theBusiness Wireline, Consumer Wireline and Mexicoreporting units and the former U.S. video business wereestimated using both the discounted cash flow as well asmarket multiple approaches (see Note 9). The inputs tothese models are considered Level 3.\\nNOTE 13. INCOME TAXES\\nSignificant components of our deferred tax liabilities\\n(assets) are as follows at December 31:\\n2022 2021\\nDepreciation and amortization $ 36,570 $ 35,894\\nLicenses and nonamortizable intangibles 19,339 15,573\\nEmployee benefits (2,251) (3,178)\\nDeferred fulfillment costs 1,989 1,797\\nEquity in partnership 3,284 3,285\\nNet operating loss and other\\ncarryforwards (5,817) (6,109)\\nOther – net (343) 2,153\\nSubtotal 52,771 49,',\n", " '153\\nSubtotal 52,771 49,415\\nDeferred tax assets valuation allowance 4,175 4,343\\nNet deferred tax liabilities $56,946 $ 53,758\\nNoncurrent deferred tax liabilities $ 57,032 $ 53,767\\nLess: Noncurrent deferred tax assets (86) (9)\\nNet deferred tax liabilities $56,946 $ 53,758\\nAt December 31, 2022, we had combined net operating and\\ncapital loss carryforwards (tax effected) for federalincome tax purposes of $892, state of $747 and foreign of$2,441, expiring through 2042. Additionally, we had federalcredit carryforwards of $293 and state credit carry-forwards of $1,444, expiring primarily through 2042.\\nWe recognize a valuation allowance if, based on the\\nweight of available evidence, it is more likely than not thatsome portion, or all, of a deferred tax asset will not berealized. Our valuation allowances at December 31, 2022and 2021 related primarily to state and foreign netoperating losses and state credit carryforwards.',\n", " 'We consider post-1986 unremitted foreign earnings\\nsubjected to the one-time transition tax not to beindefinitely reinvested as such earnings can be repatriatedwithout any significant incremental tax costs. We considerother types of unremitted foreign earnings to beindefinitely reinvested. U.S. income and foreignwithholding taxes have not been recorded on temporarydifferences related to investments in certain foreignsubsidiaries as such differences are consideredindefinitely reinvested. Determination of the amount ofunrecognized deferred tax liability is not practicable.We recognize the financial statement effects of a tax\\nreturn position when it is more likely than not, based onthe technical merits, that the position will ultimately besustained. For tax positions that meet this recognitionthreshold, we apply our judgment, taking into accountapplicable tax laws, our experience in managing tax auditsand relevant GAAP, to determine the amount of taxbenefits to recognize in our financial statements. For eachposition, the difference between the benefit realized onour tax return and the benefit reflected in our financialstatements is recorded on our consolidated balancesheets as an unrecognized tax benefit (UTB).',\n", " 'We updateour UTBs at each financial statement date to reflect theimpacts of audit settlements and other resolutions ofaudit issues, the expiration of statutes of limitation,developments in tax law and ongoing discussions withtaxing authorities. A reconciliation of the change in ourUTB balance from January 1 to December 31 for 2022 and2021 is as follows:\\nFederal, State and Foreign Tax 2022 2021\\nBalance at beginning of year $ 8,954 $ 9,415\\nIncreases for tax positions\\nrelated to the current year 1,389 677\\nIncreases for tax positions\\nrelated to prior years 577 332\\nDecreases for tax positions\\nrelated to prior years (1,079) (1,169)\\nLapse of statute of limitations (2) (6)\\nSettlements (182) (295)\\nBalance at end of year 9,657 8,954\\nAccrued interest and penalties 1,930 2,054\\nGross unrecognized income tax benefits 11,587 11,008\\nLess: Deferred federal and state\\nincome tax benefits (723) (728)\\nLess: Tax attributable to timing\\nitems included above (4,640) (3,',\n", " '640) (3,428)\\nTotal UTB that, if recognized, would\\nimpact the effective income taxrate as of the end of the year $ 6,224 $ 6,852\\nPeriodically we make deposits to taxing jurisdictions which\\nreduce our UTB balance but are not included in thereconciliation above. The amount of deposits thatreduced our UTB balance was $1,767 at December 31, 2022and $377 at December 31, 2021.\\nAccrued interest and penalties included in UTBs were\\n$1,930 as of December 31, 2022 and $2,054 as ofDecember 31, 2021. We record interest and penaltiesrelated to federal, state and foreign UTBs in income taxexpense. The net interest and penalty expense (benefit)included in income tax expense was $(86) for 2022, $129for 2021 and $127 for 2020.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n;',\n", " 'We file income tax returns in the U.S. federal jurisdiction\\nand various state, local and foreign jurisdictions. As a largetaxpayer, our income tax returns are regularly audited bythe Internal Revenue Service (IRS) and other taxingauthorities.\\nThe IRS has completed field examinations of our tax\\nreturns through 2015. All audit periods prior to 2005 areclosed for federal examination purposes and we haveeffectively resolved all outstanding audit issues for yearsthrough 2010 with the IRS Appeals Division. Those yearswill be closed as the final paperwork is processed in thecoming months.\\nWhile we do not expect material changes, we are generally\\nunable to estimate the range of impacts on the balance ofthe remaining uncertain tax positions or the impact on theeffective tax rate from the resolution of these issues untileach year is closed; and it is possible that the amount ofunrecognized benefit with respect to our uncertain taxpositions could increase or decrease within the next 12months.',\n", " 'The components of income tax (benefit) expense are as\\nfollows:\\n2022 2021 2020\\nFederal:\\nCurrent $5 7 9 $ (2,400) $ (346)\\nDeferred 2,206 6,872 858\\n2,785 4,472 512\\nState and local:\\nCurrent 21 289 338\\nDeferred 912 648 272\\n933 937 610\\nForeign:\\nCurrent 106 (66) 14\\nDeferred (44) 52 32\\n62 (14) 46\\nTotal $ 3,780 $ 5,395 $ 1,168\\n“Income (Loss) from Continuing Operations Before\\nIncome Taxes” in the Consolidated Statements of Incomeincluded the following components for the years endedDecember 31:\\n2022 2021 2020\\nU.S. income (loss) before\\nincome taxes $ (1,480) $ 29,678 $ 510\\nForeign income (loss)\\nbefore income taxes (1,614) (507) (864)\\nTotal $ (3,094) $ 29,',\n", " '614) (507) (864)\\nTotal $ (3,094) $ 29,171 $ (354)A reconciliation of income tax expense (benefit) on\\ncontinuing operations and the amount computed byapplying the statutory federal income tax rate of 21% toincome from continuing operations before income taxesis as follows:\\n2022 2021 2020\\nTaxes computed at federal\\nstatutory rate $ (650) $ 6,126 $ (74)\\nIncreases (decreases) in\\nincome taxes resulting from:\\nState and local income taxes –\\nnet of federal income taxbenefit 795 936 170\\nCARES Act federal NOL\\ncarryback — (471) —\\nTax on foreign investments 43 47 (124)\\nNoncontrolling interest (308) (291) (286)\\nPermanent items and R&D\\ncredit (121) (153) (195)\\nAudit resolutions (642) (220) (112)\\nDivestitures (481) (558) 107\\nGoodwill impairment\\n15,210 16 1,702\\nOther – net (66) (37) (20)\\nTotal $3 , 7 8 0 $ 5,',\n", " '7 8 0 $ 5,395 $ 1,168\\nEffective Tax Rate (122.2)% 18.5 % (329.9)%\\n1Goodwill impairments are not deductible for tax purposes.\\nOn March 27, 2020, the Coronavirus Aid, Relief, and\\nEconomic Security (CARES) Act was enacted, which allowsfor a Net Operating Loss (NOL) generated in 2020 to becarried back to a year with a federal rate of 35%. During2021, we recorded a $471 tax benefit for the rate impact ofthe 2020 NOL carryback adjusted for the domesticmanufacturing deduction limitation in the carryback yearand applicable unrecognized tax benefits.\\nAT&T is subject to the Global Intangible Low Taxed\\nIncome (GILTI) provisions created under the Tax Cuts andJobs Act of 2017. We report the tax impact of GILTI as aperiod cost when incurred.\\nNOTE 14. PENSION AND POSTRETIREMENT BENEFITS\\nWe offer noncontributory pension programs covering the\\nmajority of domestic nonmanagement employees in ourCommunications business.',\n", " 'Nonmanagement employees’pension benefits are generally calculated using one of twoformulas: a flat dollar amount applied to years of serviceaccording to job classification or a cash balance plan withnegotiated annual pension band credits as well as interestcredits. Most employees can elect to receive their pensionbenefits in either a lump sum payment or an annuity.\\n;.',\n", " 'Pension programs covering U.S. management employees\\nare closed to new entrants. These programs continue toprovide benefits to participants that were generally hiredbefore January 1, 2015, who receive benefits under eithercash balance pension programs that include annual ormonthly credits based on salary as well as interest credits,or a traditional pension formula (i.e., a stated percentageof employees’ adjusted career income).\\nWe also provide a variety of medical, dental and life\\ninsurance benefits to certain retired employees undervarious plans and accrue actuarially determinedpostretirement benefit costs as active employees earnthese benefits.\\nDuring the third quarter of 2022, we committed to, and\\nreflected in our results, plan changes impactingpostretirement health and welfare benefits. This planchange aligns our benefit plans to market level.Obligations and Funded Status\\nFor defined benefit pension plans, the benefit obligation is\\nthe projected benefit obligation, the actuarial presentvalue, as of our December 31 measurement date, of allbenefits attributed by the pension benefit formula toemployee service rendered to that date.',\n", " 'The amount ofbenefit to be paid depends on a number of future eventsincorporated into the pension benefit formula, includingestimates of the average life of employees and theirbeneficiaries and average years of service rendered. It ismeasured based on assumptions concerning futureinterest rates and future employee compensation levelsas applicable.\\nFor postretirement benefit plans, the benefit obligation is\\nthe accumulated postretirement benefit obligation, theactuarial present value as of the measurement date of allfuture benefits attributed under the terms of thepostretirement benefit plans to employee service.\\nThe following table presents the change in the projected benefit obligation for the years ended December 31:\\nPension Benefits Postretirement Benefits\\n2022 2021 2022 2021\\nBenefit obligation at beginning of year $ 57,212 $ 62,158 $ 12,552 $ 13,928\\nService cost - benefits earned during the period 617 957 32 45\\nInterest cost on projected benefit obligation 1,747 1,276 277 210\\nAmendments — — (2,370) —\\nActuarial (gain) loss (10,894) (1,237) (1,',\n", " '894) (1,237) (1,919) (275)\\nBenefits paid, including settlements (5,854) (5,942) (1,292) (1,356)\\nBenefit obligation at end of year $ 42,828 $ 57,212 $ 7,280 $ 12,552\\nThe following table presents the change in the fair value of plan assets for the years ended December 31 and the plans’\\nfunded status at December 31:\\nPension Benefits Postretirement Benefits\\n2022 2021 2022 2021\\nFair value of plan assets at beginning of year $ 54,401 $ 54,606 $ 3,198 $ 3,843\\nActual return on plan assets (7,673) 5,737 (370) 210\\nBenefits paid, including settlements1(5,854) (5,942) (788) (1,163)\\nContributions — — 120 308\\nFair value of plan assets at end of year 40,874 54,401 2,160 3,198\\nUnfunded status at end of year2$ (1,954) $ (2,811) $ (5,',\n", " '954) $ (2,811) $ (5,120) $ (9,354)\\n1At our discretion, certain postretirement benefits may be paid from our cash accounts, which does not reduce Voluntary Employee Benefit Association (VEBA) assets.\\nFuture benefit payments may be made from VEBA trusts and thus reduce those asset balances.\\n2Funded status is not indicative of our ability to pay ongoing pension benefits or of our obligation to fund retirement trusts. Required pension fundin g is determined in\\naccordance with the Employee Retirement Income Security Act of 1974, as amended (ERISA) and applicable regulations.',\n", " 'Amounts recognized on our consolidated balance sheets at December 31 are listed below:\\nPension Benefits Postretirement Benefits\\n2022 2021 2022 2021\\nCurrent portion of employee benefit obligation1$— $— $ (1,058) $ (1,106)\\nEmployee benefit obligation2(1,954) (2,811) (4,062) (8,248)\\nNet amount recognized $ (1,954) $ (2,811) $ (5,120) $ (9,354)\\n1Included in “Accounts payable and accrued liabilities.”\\n2Included in “Postemployment benefit obligation,” combined with international pension obligations and other postemployment obligations of $161 a nd $1,083 at\\nDecember 31, 2022, and $364 and $1,226 at December 31, 2021, respectively.\\nThe accumulated benefit obligation for our pension plans represents the actuarial present value of benefits based on\\nemployee service and compensation as of a certain date and does not include an assumption about future compensationlevels.',\n", " 'The accumulated benefit obligation for our pension plans was $42,137 at December 31, 2022, and $56,159 atDecember 31, 2021.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n;:',\n", " 'Net Periodic Benefit Cost and Other Amounts Recognized in Other Comprehensive Income\\nPeriodic Benefit CostsThe service cost component of net periodic pension cost (credit) is recorded in operating expenses in the consolidated\\nstatements of income while the remaining components are recorded in “Other income (expense) – net.” Our combinednet pension and postretirement cost (credit) recognized in our consolidated statements of income was $(4,789), $(7,652)and $711 for the years ended December 31, 2022, 2021 and 2020.\\nThe following table presents the components of net periodic benefit cost (credit):\\nPension Benefits Postretirement Benefits\\n2022 2021 2020 2022 2021 2020\\nService cost – benefits earned during the period $ 617 $ 957 $ 1,029 $3 2 $4 5 $5 3\\nInterest cost on projected benefit obligation 1,747 1,276 1,687 277 210 416\\nExpected return on assets (3,107) (3,513) (3,',\n", " '107) (3,513) (3,557) (112) (151) (178)\\nAmortization of prior service credit (133) (144) (113) (2,558) (2,537) (2,329)\\nNet periodic benefit cost (credit) before\\nremeasurement (876) (1,424) (954) (2,361) (2,433) (2,038)\\nActuarial (gain) loss (115) (3,461) 2,404 (1,437) (334) 1,299\\nNet pension and postretirement cost (credit) $ (991) $ (4,885) $ 1,450 $ (3,798) $ (2,',\n", " '885) $ 1,450 $ (3,798) $ (2,767) $ (739)\\nOther Changes in Benefit Obligations Recognized in Other Comprehensive Income\\nThe following table presents the after-tax changes in benefit obligations recognized in OCI and the after-tax prior service\\ncredits that were amortized from OCI into net periodic benefit costs:\\nPension Benefits Postretirement Benefits\\n2022 2021 2020 2022 2021 2020\\nBalance at beginning of year $ 416 $5 2 5 $3 6 1 $ 6,496 $ 8,408 $ 8,163\\nPrior service (cost) credit — — 250 1,786 — 2,001\\nAmortization of prior service credit (100) (109) (86) (1,928) (1,912) (1,756)\\nTotal recognized in other comprehensive (income) loss (100) (109) 164 (142) (1,912) 245\\nBalance at end of year $3 1 6 $ 416 $ 525 $ 6,354 $ 6,496 $ 8,',\n", " '354 $ 6,496 $ 8,408\\nAssumptions\\nIn determining the projected benefit obligation and the net pension and postretirement benefit cost, we used the\\nfollowing significant weighted-average assumptions:\\nPension Benefits Postretirement Benefits\\n2022 2021 2020 2022 2021 2020\\nWeighted-average discount rate for determining\\nbenefit obligation at December 31 5.20 % 3.00 % 2.70 % 5.20 % 2.80 % 2.40 %\\nDiscount rate in effect for determining service cost14.40 % 3.30 % 3.60 % 4.00 % 2.90 % 3.50 %\\nDiscount rate in effect for determining interest cost13.90 % 2.30 % 2.90 % 3.20 % 1.60 % 2.70 %\\nWeighted-average interest credit rate for\\ncash balance pension programs24.10 % 3.20 % 3.10 % —% —% —%\\nLong-term rate of return on plan assets 6.75 % 6.75 % 7.00 % 4.50 % 4.50 % 4.',\n", " '75 % 7.00 % 4.50 % 4.50 % 4.75 %\\nComposite rate of compensation increase for\\ndetermining benefit obligation 3.00 % 3.00 % 3.00 % 3.00 % 3.00 % 3.00 %\\nComposite rate of compensation increase for\\ndetermining net cost (credit) 3.00 % 3.00 % 3.00 % 3.00 % 3.00 % 3.00 %\\n1Weighted-average discount rates shown for years with interim remeasurements: 2022 and 2021 for pension benefits and 2022 for postretirement benefi ts.\\n2Weighted-average interest crediting rates for cash balance pension programs relate only to the cash balance portion of total pension benefits. A 0.5 0% increase in the\\nweighted-average interest crediting rate would increase the pension benefit obligation by $135.\\n;,',\n", " 'We recognize gains and losses on pension and\\npostretirement plan assets and obligations immediately in“Other income (expense) – net” in our consolidatedstatements of income. These gains and losses aregenerally measured annually as of December 31 andaccordingly, will normally be recorded during the fourthquarter, unless an earlier remeasurement is required.Should actual experience differ from actuarialassumptions, the projected pension benefit obligation andnet pension cost and accumulated postretirement benefitobligation and postretirement benefit cost would beaffected in future years.\\nDiscount Rate Our assumed weighted-average discount\\nrates for both pension and postretirement benefits of5.20%, at December 31, 2022, reflect the hypothetical rateat which the projected benefit obligation could beeffectively settled or paid out to participants. Wedetermined our discount rate based on a range of factors,including a yield curve composed of the rates of return onseveral hundred high-quality, fixed income corporatebonds available at the measurement date andcorresponding to the related expected durations of futurecash outflows. These bonds had an average rating of atleast Aa3 or AA- by the nationally recognized statisticalrating organizations, denominated in U.S.',\n", " 'dollars, andgenerally not callable, convertible or index linked. For theyear ended December 31, 2022, when compared to theyear ended December 31, 2021, we increased our pensiondiscount rate by 2.20%, resulting in a decrease in ourpension plan benefit obligation of $11,738 and increasedour postretirement discount rate by 2.40%, resulting in adecrease in our postretirement benefit obligation of$2,102. For the year ended December 31, 2021, weincreased our pension discount rate by 0.30%, resulting ina decrease in our pension plan benefit obligation of $1,645and increased our postretirement discount rate by 0.40%,resulting in a decrease in our postretirement benefitobligation of $341.\\nWe utilize a full yield curve approach in the estimation of\\nthe service and interest components of net periodicbenefit costs for pension and other postretirementbenefits. Under this approach, we apply discounting usingindividual spot rates from a yield curve composed of therates of return on several hundred high-quality, fixedincome corporate bonds available at the measurementdate.',\n", " 'These spot rates align to each of the projectedbenefit obligations and service cost cash flows. Theservice cost component relates to the active participantsin the plan, so the relevant cash flows on which to applythe yield curve are considerably longer in duration onaverage than the total projected benefit obligation cashflows, which also include benefit payments to retirees.Interest cost is computed by multiplying each spot rate bythe corresponding discounted projected benefitobligation cash flows. The full yield curve approachreduces any actuarial gains and losses based uponinterest rate expectations (e.g., built-in gains in interestcost in an upward sloping yield curve scenario), or gainsand losses merely resulting from the timing andmagnitude of cash outflows associated with our benefitobligations. Neither the annual measurement of our totalbenefit obligations nor annual net benefit cost is affected\\nby the full yield curve approach.\\nExpected Long-Term Rate of Return In 2023, our expected\\nlong-term rate of return is 7.50% on pension plan assetsand 6.50% on postretirement plan assets, an increase of0.75% for pension plan assets and 2.00% forpostretirement plan assets.',\n", " 'This update to our assetreturn assumptions was due to economic forecasts andchanges in the asset mix. Our long-term rates of returnreflect the average rate of earnings expected on thefunds invested, or to be invested, to provide for thebenefits included in the projected benefit obligations. Insetting the long-term assumed rate of return,management considers capital markets’ futureexpectations, the asset mix of the plans’ investment andaverage historical asset return. Actual long-term returnscan, in relatively stable markets, also serve as a factor indetermining future expectations. We consider manyfactors that include, but are not limited to, historicalreturns on plan assets, current market information onlong-term returns (e.g., long-term bond rates) and current\\nand target asset allocations between asset categories.\\nThe target asset allocation is determined based onconsultations with external investment advisers. If allother factors were to remain unchanged, we expect that a\\n0.50% decrease in the expected long-term rate of returnwould cause 2023 combined pension and postretirementcost to increase $201.',\n", " 'However, any differences in the rateand actual returns will be included with the actuarial gain\\nor loss recorded in the fourth quarter when our plans areremeasured.\\nComposite Rate of Compensation Increase Our expected\\ncomposite rate of compensation increase cost of 3.00% in2022 and 2021 reflects the long-term average rate ofsalary increases.\\nHealthcare Cost Trend Our healthcare cost trend\\nassumptions are developed based on historical cost data,the near-term outlook and an assessment of likely long-term trends. Based on our assessment of expectations ofhealthcare industry inflation, our 2023 assumed annualhealthcare prescription drug cost trend and medical costtrend for eligible participants will increase from an annualand ultimate trend rate of 4.25% to an annual andultimate trend rate of 4.50%. This change in assumptionincreased our obligation by $19. For 2022, our assumedannual healthcare prescription drug cost trend andmedical cost trend for eligible participants increased froman annual and ultimate trend rate of 4.00% to an annualand ultimate trend rate of 4.25%. This change inassumption increased our obligation by $31.',\n", " 'This change inassumption increased our obligation by $31.\\nPlan AssetsPlan assets consist primarily of private and public equity,\\ngovernment and corporate bonds, and real assets (realestate and natural resources). The asset allocations of the\\npension plans are maintained to meet ERISArequirements. Any plan contributions, as determined byERISA regulations, are made to a pension trust for thebenefit of plan participants. We do not have significantERISA required contributions to our pension plans for2023.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n;;',\n", " 'We maintain VEBA trusts to partially fund postretirement\\nbenefits; however, there are no ERISA or regulatoryrequirements that these postretirement benefit plans befunded annually. We made discretionary contributions of$120 in December 2022 and $308 in December 2021 to ourpostretirement plan.\\nThe principal investment objectives are to ensure the\\navailability of funds to pay pension and postretirementbenefits as they become due under a broad range offuture economic scenarios, maximize long-terminvestment return with an acceptable level of risk basedon our pension and postretirement obligations, anddiversify broadly across and within the capital markets toinsulate asset values against adverse experience in any\\none market. Each asset class has broadly diversifiedcharacteristics. Substantial biases toward any particularinvesting style or type of security are sought to beavoided by managing the aggregation of all accounts withportfolio benchmarks. Asset and benefit obligationforecasting studies are conducted periodically, generallyevery two to three years, or when significant changeshave occurred in market conditions, benefits, participantdemographics or funded status. Decisions regardinginvestment policy are made with an understanding of theeffect of asset allocation on funded status, futurecontributions and projected expenses.',\n", " 'The plans’ weighted-average asset targets and actual allocations as a percentage of plan assets,',\n", " 'The plans’ weighted-average asset targets and actual allocations as a percentage of plan assets, including the notional\\nexposure of future contracts by asset categories at December 31 are as follows:\\nPension Assets Postretirement (VEBA) Assets\\nTarget 2022 2021 Target 2022 2021\\nEquity securities:\\nDomestic 5 % - 25% 7% 16 % 16 % - 26% 21 % 19 %\\nInternational 1 % - 21% 4 13 16 % - 26% 21 19\\nFixed income securities 40 % - 50% 45 38 42 % - 52% 47 39\\nReal assets — % - 20% 16 10 — % - 6% 1 1\\nPrivate equity — % - 16% 14 12 — % - 6% 1 1\\nPreferred interests 8 % - 18% 13 10 — % - —% — —\\nOther — % - 5% 1 1 5 % - 15% 9 21\\nTotal 100 % 100 % 100 % 100 %\\nThe pension trust holds preferred equity interests valued\\nat $5,',\n", " '427 in AT&T Mobility II LLC (Mobility II), the primaryholding company for our wireless business. The preferredequity interests were valued at $5,562 as of December 31,2021. On December 27, 2022, the pension trust providedwritten notice of its right to require AT&T to purchaseMobility preferred interests outstanding. (See Note 16)\\nAt December 31, 2022, AT&T securities represented 14% of\\nassets held by our pension trust, including the preferredinterests in Mobility II. The VEBA trusts included in thesefinancial statements no longer hold AT&T securities.\\nInvestment ValuationInvestments are stated at fair value. Fair value is the price\\nthat would be received to sell an asset or paid to transfera liability at the measurement date.\\nInvestments in securities traded on a national securities\\nexchange are valued at the last reported sales price onthe final business day of the year. If no sale was reportedon that date, they are valued at the last reported bid price.Investments in securities not traded on a nationalsecurities exchange are valued using pricing models,quoted prices of securities with similar characteristics ordiscounted cash flows.',\n", " 'Shares of registered investmentcompanies are valued based on quoted market prices,which represent the net asset value of shares held atyear-end.Other commingled investment entities are valued at\\nquoted redemption values that represent the net assetvalues of units held at year-end which management hasdetermined approximates fair value.\\nReal estate and natural resource direct investments are\\nvalued at amounts based upon appraisal reports. Fixedincome securities valuation is based upon observableprices for comparable assets, broker/dealer quotes(spreads or prices), or a pricing matrix that derivesspreads for each bond based on external market data,including the current credit rating for the bonds, creditspreads to Treasuries for each credit rating, sector add-ons or credits, issue-specific add-ons or credits as well ascall or other options.\\nThe preferred interests in Mobility II are valued by an\\nindependent fiduciary using an income approach.\\nPurchases and sales of securities are recorded as of the\\ntrade date. Realized gains and losses on sales of securitiesare determined on the basis of average cost. Interestincome is recognized on the accrual basis. Dividendincome is recognized on the ex-dividend date.',\n", " 'Dividendincome is recognized on the ex-dividend date.\\nNon-interest bearing cash and overdrafts are valued at\\ncost, which approximates fair value.\\n;?',\n", " 'Fair Value Measurements\\nSee Note 12 for a discussion of the fair value hierarchy that prioritizes the inputs to valuation techniques used to measure\\nfair value.\\nThe following tables set forth by level, within the fair value hierarchy, the pension and postretirement assets and\\nliabilities at fair value as of December 31, 2022:\\nPension Assets and Liabilities at Fair Value as of December 31, 2022\\nLevel 1 Level 2 Level 3 Total\\nNon-interest bearing cash $ 158 $ — $ — $ 158\\nInterest bearing cash 5 — — 5Foreign currency contracts — 4 — 4Equity securities:\\nDomestic equities 2,312 — 2 2,314International equities 1,251 — — 1,251\\nPreferred interests — — 5,427 5,427Fixed income securities:\\nCorporate bonds and other investments — 9,366 1 9,367Government and municipal bonds — 5,450 — 5,450Mortgage-backed securities — 220 — 220\\nReal estate and real assets — — 4,343 4,343Securities lending collateral 1,137 1,407 — 2,',\n", " '343Securities lending collateral 1,137 1,407 — 2,544Receivable for variation margin 5 — — 5\\nAssets at fair value 4,868 16,447 9,773 31,088\\nInvestments sold short and other liabilities at fair value (261) (5) — (266)\\nTotal plan net assets at fair value $ 4,607 $ 16,442 $ 9,773 $ 30,822\\nAssets held at net asset value practical expedient\\nPrivate equity funds 5,866\\nReal estate funds 1,907\\nCommingled funds 5,045\\nTotal assets held at net asset value practical expedient 12,818Other assets (liabilities)\\n1(2,766)\\nTotal Plan Net Assets $ 40,874\\n1Other assets (liabilities) include amounts receivable, accounts payable and net adjustment for securities lending payable.',\n", " 'accounts payable and net adjustment for securities lending payable.\\nPostretirement Assets and Liabilities at Fair Value as of December 31, 2022\\nLevel 1 Level 2 Level 3 Total\\nInterest bearing cash $ 191 $ 4 $ — $ 195\\nEquity securities:\\nDomestic equities 258 — — 258International equities 233 — 1 234\\nSecurities lending collateral — 12 — 12\\nAssets at fair value 682 16 1 699\\nSecurities lending payable and other liabilities — (12) — (12)\\nTotal plan net assets at fair value $ 682 $ 4 $ 1 $ 687\\nAssets held at net asset value practical expedient\\nPrivate equity funds 13\\nReal estate funds 13\\nCommingled funds 1,445\\nTotal assets held at net asset value practical expedient 1,471Other assets (liabilities)\\n12\\nTotal Plan Net Assets $ 2,160\\n1Other assets (liabilities) include amounts receivable and accounts payable.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n;!',\n", " 'The following tables set forth by level, within the fair value hierarchy, the pension and postretirement assets and\\nliabilities at fair value as of December 31, 2021:\\nPension Assets and Liabilities at Fair Value as of December 31, 2021\\nLevel 1 Level 2 Level 3 Total\\nNon-interest bearing cash $ 167 $ — $ — $ 167\\nInterest bearing cash 11 — — 11Foreign currency contracts — 5 — 5Equity securities:\\nDomestic equities 7,693 — 1 7,694International equities 4,117 — 7 4,124\\nPreferred interests — — 5,562 5,562Fixed income securities:\\nCorporate bonds and other investments — 11,168 2 11,170Government and municipal bonds — 6,977 — 6,977Mortgage-backed securities — 268 — 268\\nReal estate and real assets — — 3,318 3,318Securities lending collateral 1,645 1,285 — 2,930Receivable for variation margin 8 — — 8\\nAssets at fair value 13,641 19,703 8,',\n", " '641 19,703 8,890 42,234\\nInvestments sold short and other liabilities at fair value (529) (3) (1) (533)\\nTotal plan net assets at fair value $ 13,112 $ 19,700 $ 8,889 $ 41,701\\nAssets held at net asset value practical expedient\\nPrivate equity funds 6,454\\nReal estate funds 2,329\\nCommingled funds 6,780\\nTotal assets held at net asset value practical expedient 15,563Other assets (liabilities)\\n1(2,863)\\nTotal Plan Net Assets $ 54,401\\n1Other assets (liabilities) include amounts receivable, accounts payable and net adjustment for securities lending payable.',\n", " 'accounts payable and net adjustment for securities lending payable.\\nPostretirement Assets and Liabilities at Fair Value as of December 31, 2021\\nLevel 1 Level 2 Level 3 Total\\nInterest bearing cash $ 371 $ 295 $ — $ 666\\nEquity securities:\\nDomestic equities 323 — — 323International equities 287 — 1 288\\nFixed income securities:\\nCorporate bonds and other investments 1 — — 1\\nSecurities lending collateral — 9 — 9\\nAssets at fair value 982 304 1 1,287\\nSecurities lending payable and other liabilities — (9) — (9)\\nTotal plan net assets at fair value $ 982 $ 295 $ 1 $ 1,278\\nAssets held at net asset value practical expedient\\nCommingled funds 1,883\\nPrivate equity funds 19\\nReal estate funds 16\\nTotal assets held at net asset value practical expedient 1,918Other assets (liabilities)\\n12\\nTotal Plan Net Assets $ 3,198\\n1Other assets (liabilities) include amounts receivable and accounts payable.\\n;¿',\n", " 'For the years ended December 31, 2022 and 2021, our postretirement assets did not include significant investments in\\nLevel 3 assets, nor were there significant changes in fair value of those assets during the period. The tables below setforth a summary of changes in the fair value of the Level 3 pension assets for the years ended:\\nEquitiesFixed Income\\nFundsReal Estate and\\nReal Assets Total\\nBalance as of December 31, 2021 $ 5,569 $ 2 $ 3,318 $ 8,889\\nRealized gains (losses) 1 — 22 23Unrealized gains (losses) (139) — 802 663Transfers in 1 1 20 22Transfers out — (2) (29) (31)Purchases — — 716 716Sales (3) — (506) (509)\\nBalance as of December 31, 2022 $ 5,429 $ 1 $ 4,343 $ 9,773\\nEquitiesFixed Income\\nFundsReal Estate and\\nReal Assets Total\\nBalance as of December 31, 2020 $ 5,',\n", " '2020 $ 5,793 $ 53 $ 2,544 $ 8,390\\nRealized gains (losses) 2 — (31) (29)Unrealized gains (losses) (203) — 558 355Transfers in — 1 — 1Transfers out (7) (8) — (15)Purchases 7 1 425 433Sales (23) (45) (178) (246)\\nBalance as of December 31, 2021 $ 5,569 $ 2 $ 3,318 $ 8,889\\nEstimated Future Benefit Payments\\nExpected benefit payments are estimated using the same\\nassumptions used in determining our benefit obligation atDecember 31, 2022. Because benefit payments will dependon future employment and compensation levels; averageyears employed; average life spans; and paymentelections, among other factors, changes in any of theseassumptions could significantly affect these expectedamounts.',\n", " 'The following table provides expected benefitpayments under our pension and postretirement plans:\\nPension\\nBenefitsPostretirement\\nBenefits\\n2023 $ 5,612 $ 1,211\\n2024 3,734 8012025 3,747 6402026 3,632 5982027 3,561 568Years 2028 - 2032 16,688 2,322Supplemental Retirement Plans\\nWe also provide certain senior- and middle-management\\nemployees with nonqualified, unfunded supplementalretirement and savings plans. While these plans areunfunded, we have assets in a designated non-bankruptcyremote trust that are independently managed and usedto provide for certain of these benefits. These plansinclude supplemental pension benefits as well ascompensation-deferral plans, some of which include acorresponding match by us based on a percentage of thecompensation deferral. For our supplemental retirementplans, the projected benefit obligation was $1,544 and thenet supplemental retirement pension credit was $234 atand for the year ended December 31, 2022.',\n", " 'The projectedbenefit obligation was $2,326 and the net supplementalretirement pension credit was $41 at and for the yearended December 31, 2021.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n?\\x08',\n", " 'We use the same significant assumptions for the\\ncomposite rate of compensation increase in determiningour projected benefit obligation and the net pension andpostemployment benefit cost. Our discount rates of 5.10%at December 31, 2022 and 2.70% at December 31, 2021were calculated using the same methodologies used incalculating the discount rates for our qualified pensionand postretirement benefit plans.\\nDeferred compensation expense was $94 in 2022, $171 in\\n2021 and $183 in 2020.\\nContributory Savings PlansWe maintain contributory savings plans that cover\\nsubstantially all employees. Under the savings plans, wematch in cash or company stock a stated percentage ofeligible employee contributions, subject to a specifiedceiling. There are no debt-financed shares held by theEmployee Stock Ownership Plans, allocated orunallocated.\\nOur match of employee contributions to the savings plans\\nis fulfilled with purchases of our stock on the open marketor company cash.',\n", " 'Benefit cost, which is based on the costof shares or units allocated to participating employees’accounts or the cash contributed to participant accounts,was $611, $614 and $646 for the years ended December 31,2022, 2021 and 2020.\\nNOTE 15. SHARE-BASED PAYMENTS\\nUnder our various plans, senior and other management\\nemployees and nonemployee directors have receivednonvested stock and stock units. The shares will vest overa period of one to four years in accordance with the termsof those plans.\\nWe grant performance stock units, which are nonvested\\nstock units, based upon our stock price at the date ofgrant and award them in the form of AT&T common stockand cash at the end of a three-year period, subject to theachievement of certain performance goals. We treat thecash settled portion of these awards as a liability. Effectivewith the 2021 plan year, for the majority of employees,performance shares were replaced with restricted stockunits that do not have any performance conditions. Thesenew restricted stock units vest ratably over a three-yearperiod.',\n", " 'Thesenew restricted stock units vest ratably over a three-yearperiod. We grant forfeitable restricted stock and stockunits, which are valued at the market price of ourcommon stock at the date of grant and predominantlyvest over a three- to five-year period. We also grant othernonvested stock units and award them in cash at the endof a three-year period, subject to the achievement ofcertain market-based conditions. As of December 31, 2022,we were authorized to issue up to approximately 128million shares of common stock (in addition to shares thatmay be issued upon exercise of outstanding options orupon vesting of performance stock units or othernonvested stock units) to officers, employees anddirectors pursuant to these various plans.We account for our share-based payment arrangements\\nbased on the fair value of the awards on their respectivegrant date, which may affect our ability to fully realize thevalue shown on our consolidated balance sheets ofdeferred tax assets associated with compensationexpense. We record a valuation allowance when our futuretaxable income is not expected to be sufficient to recoverthe asset.',\n", " 'Accordingly, there can be no assurance that thecurrent stock price of our common shares will rise tolevels sufficient to realize the entire tax benefit currentlyreflected on our consolidated balance sheets. However, tothe extent we generate excess tax benefits (i.e., thoseadditional tax benefits in excess of the deferred taxesassociated with compensation expense previouslyrecognized) the potential future impact on income wouldbe reduced.\\nOur consolidated statements of income include the\\ncompensation cost recognized for those plans asoperating expenses, as well as the associated tax benefits,which are reflected in the table below:\\n2022 2021 2020\\nPerformance stock units $1 6 8 $ 248 $ 348\\nRestricted stock and stock units 350 199 74\\nOther nonvested stock units — ——\\nStock options — ——\\nTotal $5 1 8 $ 447 $ 422\\nIncome tax benefit $ 127 $ 110 $ 104\\nA summary of the status of our nonvested stock units as\\nof December 31, 2022,',\n", " '2022, and changes during the year thenended is presented as follows (shares in millions):\\nNonvested Stock Units SharesWeighted-Average\\nGrant-Date Fair Value\\nNonvested at January 1, 2022 35 $32.33\\nGranted 21 23.64Vested (28) 27.64Forfeited (5) 23.76Spin-off Adjustment\\n113 NA\\nNonvested at December 31, 2022 36 $22.07\\n1In connection with the WarnerMedia transaction, AT&T made certain\\nadjustments to the number of stock awards to maintain the intrinsic valueprior to the spin-off.\\nAs of December 31, 2022, there was $547 of totalunrecognized compensation cost related to nonvestedshare-based payment arrangements granted. That cost isexpected to be recognized over a weighted-averageperiod of 1.69 years. The total fair value of shares vestedduring the year was $783 for 2022, compared to $608 for2021 and $471 for 2020.\\nIt is our intent to satisfy share option exercises using our\\ntreasury stock.',\n", " 'It is our intent to satisfy share option exercises using our\\ntreasury stock. Cash received from stock option exerciseswas $2 for 2022, $11 for 2021 and $21 for 2020.\\n?',\n", " 'NOTE 16. STOCKHOLDERS’ EQUITY\\nAuthorized Shares We have authorized 14 billion\\ncommon shares of AT&T stock and 10 million preferredshares of AT&T stock, each with a par value of $1.00 pershare. Cumulative perpetual preferred shares consist ofthe following:\\n• Series A: 48 thousand shares outstanding at\\nDecember 31, 2022 and December 31, 2021, with a$25,000 per share liquidation preference and adividend rate of 5.000%.\\n• Series B: 20 thousand shares outstanding at\\nDecember 31, 2022 and December 31, 2021, with a€100,000 per share liquidation preference, and aninitial rate of 2.875%, subject to reset after May 1,2025.\\n• Series C: 70 thousand shares outstanding at\\nDecember 31, 2022 and December 31, 2021, with a$25,000 per share liquidation preference, and adividend rate of 4.75%.',\n", " 'So long as the quarterly preferred dividends are declared\\nand paid on a timely basis on each series of preferredshares, there are no limitations on our ability to declare adividend on or repurchase AT&T common shares. Thepreferred shares are optionally redeemable by AT&T atthe liquidation price on or after five years from theissuance date, or upon certain other contingent events.\\nStock Repurchase Program From time to time, we\\nrepurchase shares of common stock for distributionthrough our employee benefit plans or in connection withcertain acquisitions. Our Board of Directors has approvedthe following authorization to repurchase common stock:(1) March 2013 authorization program of 300 millionshares, which was completed in 2020 and (2) March 2014authorization program for 300 million shares, withapproximately 144 million outstanding at December 31,2022.\\nTo implement these authorizations, we used open market\\nrepurchases, relying on Rule 10b5-1 of the SecuritiesExchange Act of 1934, where feasible. We also usedaccelerated share repurchase agreements with largefinancial institutions to repurchase our stock.',\n", " 'During 2021,there were no shares repurchased under the March 2014authorization. During 2022, we repurchased approximately34 million shares totaling $662 under the March 2014authorization.\\nDividend Declarations In December 2022 and December\\n2021, AT&T declared a quarterly preferred dividend of $36.In December 2022 and December 2021, AT&T declared acommon dividend of $0.2775 and $0.52 per share ofcommon stock, respectively.Preferred Interests Issued by Subsidiaries We have\\nissued cumulative perpetual preferred membershipinterests in certain subsidiaries. The preferred interestsare entitled to cash distributions, subject to declaration.The preferred interests are included in “Noncontrollinginterest” on the consolidated balance sheets.\\nMobility II\\nIn 2018, we issued 320 million Series A CumulativePerpetual Preferred Membership Interests in Mobility II(Mobility preferred interests), which pay cash distributionsof 7% per annum, subject to declaration. So long as thedistributions are declared and paid, the terms of theMobility preferred equity interests will not impose anylimitations on cash movements between affiliates, or ourability to declare a dividend on or repurchase AT&Tshares.',\n", " 'A holder of the Mobility preferred interests may put the\\ninterests to Mobility II. Mobility II may redeem theinterests upon a change in control of Mobility II or on orafter September 9, 2022. When either option arises due toa passage of time, that option may be exercised onlyduring certain periods.\\nThe price at which a put option or a redemption option\\ncan be exercised is the greater of (1) the market value ofthe interests as of the last date of the quarter precedingthe date of the exercise of a put or redemption option and(2) the sum of (a) twenty-five dollars plus (b) any accruedand unpaid distributions. The redemption price may bepaid with cash, AT&T common stock, or a combination ofcash and AT&T common stock, at Mobility II’s soleelection. In no event shall Mobility II be required to delivermore than 250 million shares of AT&T common stock tosettle put and redemption options. We have the intentand ability to settle the Mobility preferred equity interestswith cash.',\n", " 'We have the intentand ability to settle the Mobility preferred equity interestswith cash.\\nOn October 24, 2022, approximately 105 million Mobility\\npreferred interests were put to AT&T by a third-partyinvestor, for which we paid approximately $2,600 cash toredeem. On December 27, 2022, the AT&T pension trustprovided written notice of its right to require us topurchase the remaining 213 million, or approximately$5,340, of Mobility preferred interests outstanding. Theterms of the instruments limit the amount we arerequired to redeem in any 12-month period toapproximately 107 million shares, or $2,670. We expect toredeem approximately $2,670 of the Mobility preferredinterests primarily in October 2023 and $2,670 in October2024, unless the interests are called or the puts areaccepted by AT&T prior to those dates. With the certaintyof redemption, the remaining Mobility preferred interestsNotes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n?',\n", " 'were reclassified from equity to a liability at fair value, with\\napproximately $2,670 recorded in current liabilities as“Accounts payable and accrued liabilities” and $2,670recorded in “Other noncurrent liabilities.” The liabilitiesassociated with the Mobility preferred interests areconsidered Level 3 under the Fair Value Measurement andDisclosure framework (see Notes 12 and 14). Thedifference between the carrying value of the Mobilitypreferred interest, which represented fair value atcontribution, and the fair value of the instrument uponsettlement and/or balance sheet reclassification wasrecorded as an adjustment to additional paid-in capital.\\nAs of December 31, 2022, we have approximately\\n213 million Mobility preferred interests outstanding, whichhave a redemption value of approximately $5,340 and paycash distributions of $373 per annum, subject todeclaration.\\nTower Holdings\\nIn 2019, we issued $6,000 nonconvertible cumulativepreferred interests in a wireless subsidiary (TowerHoldings) that holds interests in various tower assets andhave the right to receive approximately $6,000 if thepurchase options from the tower companies areexercised.',\n", " 'The membership interests in Tower Holdings consist of (1)\\ncommon interests, which are held by a consolidatedsubsidiary of AT&T, and (2) two series of preferredinterests (collectively the “Tower preferred interests”).The September series (Class A-1) of the preferredinterests totals $1,500 and pays an initial preferreddistribution of 5.0%, and the December series (Class A-2)totals $4,500 and pays an initial preferred distribution of4.75%. Distributions are paid quarterly, subject todeclaration, and reset every five years. Any failure todeclare or pay distributions on the Tower preferredinterests would not impose any limitation on cashmovements between affiliates, or our ability to declare adividend on or repurchase AT&T shares. We can call theTower preferred interests at the issue price beginning fiveyears from the issuance date or upon the receipt ofproceeds from the sale of the underlying assets.\\nThe holders of the Tower preferred interests have the\\noption to require redemption upon the occurrence ofcertain contingent events, such as the failure of AT&T topay the preferred distribution for two or more periods orto meet certain other requirements, including a minimumcredit rating.',\n", " 'If notice is given upon such an event, allother holders of equal or more subordinate classes ofmembership interests in Tower Holdings are entitled toreceive the same form of consideration payable to theholders of the preferred interests, resulting in a deemedliquidation for accounting purposes.Telco LLC\\nIn September 2020, we issued $2,000 nonconvertiblecumulative preferred interests out of a newly createdlimited liability company (Telco LLC) that was formed tohold telecommunication-related assets.\\nMembers’ equity in Telco LLC consist of (1) member’s\\ninterests, which are held by a consolidated subsidiary ofAT&T, and (2) preferred interests (Telco preferredinterests), which pay an initial preferred distribution of4.25% annually, subject to declaration, and subject toreset every seven years. Failure to pay distributions on theTelco preferred interests would not limit cash movementsbetween affiliates, or our ability to declare a dividend onor repurchase AT&T shares. We can call the Telcopreferred interests at the issue price beginning sevenyears from the issuance date.',\n", " 'The holders of the Telco preferred interests have the\\noption to require redemption upon the occurrence ofcertain contingent events, such as the failure of Telco LLCto pay the preferred distribution for two or more periodsor to meet certain other requirements, including aminimum credit rating. If notice is given, all other holdersof equal or more subordinate classes of members’ equityare entitled to receive the same form of considerationpayable to the holders of the preferred interests, resultingin a deemed liquidation for accounting purposes.\\nPR Holdings\\nIn 2019, we issued $1,950 nonconvertible cumulative\\npreferred interests in a subsidiary (PR Holdings) that heldnotes secured by the proceeds from our agreement to sellwireless and wireline operations in Puerto Rico and theU.S. Virgin Islands. These preferred interests wereredeemed on November 6, 2020. (See Note 6)\\nThe membership interests in PR Holdings consisted of (1)\\ncommon interests, which were held by consolidatedsubsidiaries of AT&T, and (2) preferred interests (PRpreferred interests). The PR preferred interests paid aninitial preferred distribution at an annual rate of 4.75%.Distributions were paid quarterly, subject to declaration.',\n", " 'NOTE 17. SALES OF RECEIVABLES\\nWe have agreements with various third-party financial\\ninstitutions pertaining to the sales of certain types of ouraccounts receivable. The most significant of theseprograms consists of receivables arising from equipmentinstallment plans, which are sold for cash and a deferredpurchase price. Under this program, we transferreceivables to purchasers in exchange for cash andadditional consideration upon settlement of thereceivables. Under the terms of our agreement for thisprogram, we continue to service the transferredreceivables on behalf of the financial institutions.\\n?.',\n", " 'The following table sets forth a summary of cash\\nproceeds received, net of remittances paid, from sales ofreceivables for the years ended December 31:\\n2022 2021 2020\\nNet cash received (paid) from\\nequipment installmentreceivables\\n1$ 1,875 $ 1,000 $ (1,565)\\nNet cash received (paid) from\\nother programs 620 (295) 295\\nTotal net cash impact to cash\\nflows from operating activities $ 2,495 $ 705 $ (1,270)\\n1Net cash from initial sales of $11,129, $9,740 and $6,089 for the years ended\\nDecember 31, 2022, 2021 and 2020, respectively.\\nThe sales of receivables did not have a material impact on\\nour consolidated statements of income or to “TotalAssets” reported on our consolidated balance sheets. Wereflect cash receipts on sold receivables as cash flowsfrom operations in our consolidated statements of cashflows. Cash receipts on the deferred purchase price areclassified as cash flows from investing activities, whenapplicable.',\n", " 'Cash receipts on the deferred purchase price areclassified as cash flows from investing activities, whenapplicable.\\nThe following table sets forth a summary of the\\nequipment installment receivables and accounts beingserviced at December 31:\\n2022 2021\\nGross receivables: $ 4,165 $4 , 3 6 1\\nBalance sheet classification\\nAccounts receivable\\nNotes receivable 1,789 1,846\\nTrade receivables 522 606\\nOther Assets\\nNoncurrent notes and trade\\nreceivables 1,854 1,909\\nOutstanding portfolio of receivables\\nderecognized from our consolidatedbalance sheets $ 11,030 $ 9,767\\nCash proceeds received, net of\\nremittances\\n18,519 6,644\\n1Represents amounts to which financial institutions remain entitled, excluding\\nthe deferred purchase price.',\n", " 'We offer our customers the option to purchase certainwireless devices in installments over a specified period oftime and, in many cases, once certain conditions are met,they may be eligible to trade in the original equipment fora new device and have the remaining unpaid balance paidor settled.We maintain a program under which we transfer a portion\\nof these receivables through our bankruptcy-remotesubsidiary in exchange for cash and additionalconsideration upon settlement of the receivables,referred to as the deferred purchase price. In the event acustomer trades in a device prior to the end of theinstallment contract period, we agree to make a paymentto the financial institutions equal to any outstandingremaining installment receivable balance. Accordingly, werecord a guarantee obligation for this estimated amountat the time the receivables are transferred.',\n", " 'The following table sets forth a summary of equipment\\ninstallment receivables sold under this program:\\n2022 2021 2020\\nGross receivables sold $ 11,510 $ 10,793 $ 7,270\\nNet receivables sold111,061 10,502 7,026\\nCash proceeds received 11,129 9,740 6,089\\nDeferred purchase price\\nrecorded 245 1,080 1,021\\nGuarantee obligation recorded 703 434 157\\n1Receivables net of allowance, imputed interest and equipment trade-in right\\nguarantees.\\nThe deferred purchase price and guarantee obligation areinitially recorded at estimated fair value and subsequentlyadjusted for changes in present value of expected cashflows. The estimation of their fair values is based onremaining installment payments expected to be collectedand the expected timing and value of device trade-ins.The estimated value of the device trade-ins considersprices offered to us by independent third parties andcontemplate changes in value after the launch of a devicemodel.',\n", " 'The fair value measurements used for the deferredpurchase price and the guarantee obligation areconsidered Level 3 under the Fair Value Measurement andDisclosure framework (see Note 12).\\nThe following table presents the previously transferred\\nequipment installment receivables, which we repurchasedin exchange for the associated deferred purchase price:\\n2022 2021 2020\\nFair value of repurchased\\nreceivables $ 3,314 $ 1,424 $ 1,271\\nCarrying value of deferred\\npurchase price 3,335 1,334 1,235\\nGain (loss) on repurchases1$ (21) $9 0 $ 3 6\\n1These gains (losses) are included in “Selling, general and administrative” expense\\nin the consolidated statements of income.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n?:',\n", " 'At December 31, 2022 and December 31, 2021, our deferred\\npurchase price receivable was $2,318 and $3,177,respectively, of which $1,278 and $2,123 are included in“Prepaid and other current assets” on our consolidatedbalance sheets, with the remainder in “Other Assets.” Theguarantee obligation at December 31, 2022 andDecember 31, 2021 was $419 and $371, respectively, ofwhich $73 and $101 are included in “Accounts payable andaccrued liabilities” on our consolidated balance sheets,with the remainder in “Other noncurrent liabilities.” Ourmaximum exposure to loss as a result of selling theseequipment installment receivables is limited to the totalamount of our deferred purchase price and guaranteeobligation.\\nNOTE 18. TOWER TRANSACTION\\nIn December 2013, we closed our transaction with Crown\\nCastle International Corp. (Crown Castle) in which CrownCastle gained the exclusive rights to lease and operate9,048 wireless towers and purchased 627 of our wirelesstowers for $4,827 in cash. The leases have various termswith an average length of approximately 28 years.',\n", " 'The leases have various termswith an average length of approximately 28 years. As theleases expire, Crown Castle will have fixed price purchaseoptions for these towers totaling approximately $4,200,based on their estimated fair market values at the end ofthe lease terms. We sublease space on the towers fromCrown Castle for an initial term of ten years at currentmarket rates, subject to optional renewals in the future.\\nWe determined that we did not transfer control of the\\ntower assets, which prevented us from achieving sale-leaseback accounting for the transaction, and weaccounted for the cash proceeds from Crown Castle as afinancing obligation on our consolidated balance sheets.We record interest on the financing obligation using theeffective interest method at a rate of approximately 3.9%.The financing obligation is increased by interest expenseand estimated future net cash flows generated andretained by Crown Castle from operation of the towersites, and reduced by our contractual payments. Wecontinue to include the tower assets in “Property, Plantand Equipment – Net” on our consolidated balance sheetsand depreciate them accordingly. At December 31, 2022and 2021, the tower assets had a balance of $686 and$725, respectively.',\n", " 'Our depreciation expense for theseassets was $39 for each of 2022, 2021 and 2020.\\nPayments made to Crown Castle under this arrangement\\nwere $258 for 2022. At December 31, 2022, the futureminimum payments under the sublease arrangement are$264 for 2023, $269 for 2024, $274 for 2025, $280 for 2026,$285 for 2027 and $421 thereafter.NOTE 19. TRANSACTIONS WITH DIRECTV\\nEffective August 1, 2021, we began accounting for our\\ninvestment in DIRECTV under the equity method andrecorded our share of DIRECTV earnings as equity in netincome of affiliates, with DIRECTV considered a relatedparty (see Note 10).\\nFor the year ended December 31, 2022 , our share of\\nDIRECTV’s earnings included in equity in net income of\\naffiliates was $1,808 . Cash distributions from DIRECTV\\ntotaled $4,457 , with $1,808 classified as operating\\nactivities and $2,649 classified as investing activities in our\\nconsolidated statement of cash flows.',\n", " 'Our investment in\\nDIRECTV at December 31, 2022 was $2,911 .\\nIn addition to the assets and liabilities contributed to\\nDIRECTV, we recorded total obligations of $2,100 to cover\\ncertain net losses under the NFL SUNDAY TICKET\\ncontract, of which $1,800 is in the form of a note payable\\nto DIRECTV. For the year ended December 31, 2022, cash\\npayments to DIRECTV on the note totaled $1,211 and were\\nclassified as financing activities in our consolidatedstatement of cash flows. Amounts due under the DIRECTVnote were $130\\nat December 31, 2022 .\\nWe also provide DIRECTV with network transport for U-\\nverse products and sales services under commercialarrangements for up to five years. Under separatetransition services agreements, we provide DIRECTVcertain operational support, including servicing of certainof their customer receivables for up to three years.',\n", " 'For\\nthe year ended December 31, 2022 , we billed DIRECTV\\napproximately $1,260 for these costs, which were primarily\\nrecorded as a reduction to the operations and support\\nexpenses incurred and resulted in net retained costs to\\nAT&T of approximately $737 .\\nAt December 31, 2022, we had accounts receivable from\\nDIRECTV of $360 and accounts payable to DIRECTV of$120.\\nWe are not committed, implicitly or explicitly, to provide\\nfinancial or other support, other than noted above, as ourinvolvement with DIRECTV is limited to the carryingamount of the assets and liabilities recognized on ourbalance sheet.\\nNOTE 20. FIRSTNET\\nIn 2017, the First Responder Network Authority (FirstNet)\\nselected AT&T to build and manage the first nationwidebroadband network dedicated to America’s firstresponders. Under the 25-year agreement, FirstNetprovides 20 MHz of valuable telecommunicationsspectrum and success-based payments of $6,500 over thefirst five years to support network buildout. We arerequired to construct a network that achieves coverage\\n?,',\n", " 'and nationwide interoperability requirements and have a\\ncontractual commitment to make sustainability paymentsof $18,000 over the 25-year contract. These sustainabilitypayments represent our commitment to fund FirstNet’soperating expenses and future reinvestments in thenetwork which we own and operate, which we estimate inthe $3,000 or less range over the life of the 25-yearcontract. After FirstNet’s operating expenses are paid, weanticipate the remaining amount, expected to be in the$15,000 range, will be reinvested into the network.\\nDuring 2022, we submitted $195 in sustainability\\npayments, with future payments under the agreement of$195 for 2023, 2024 and 2025; $1,590 for 2026, $1,665 for2027; and $13,365 thereafter. Amounts paid to FirstNet,which are not expected to be returned to AT&T to bereinvested into our network, will be expensed in theperiod paid.',\n", " 'In the event FirstNet does not reinvest anyfunds to construct, operate, improve and maintain thisnetwork, our maximum exposure to loss is the totalamount of the sustainability payments, which would bereflected in higher expense.\\nThe $6,500 of initial funding from FirstNet is contingent on\\nthe achievement of six operating capability milestonesand certain first responder subscriber adoption targets.These milestones are based on coverage objectives of thefirst responder network during the construction period,which is expected to be over five years, and subscriberadoption targets. Funding payments received fromFirstNet are reflected as a reduction from the costs\\ncapitalized in the construction of the network and, asappropriate, a reduction of associated operatingexpenses. As of December 31, 2022, we have collectedapproximately $6,120 for the completion of certain tasksand anticipate collecting nearly all of the remainder of the$6,500 as we fulfill contractual deliveries set out byFirstNet in 2023.\\nNOTE 21. CONTINGENT LIABILITIES\\nWe are party to numerous lawsuits, regulatory\\nproceedings and other matters arising in the ordinarycourse of business.',\n", " 'In evaluating these matters on anongoing basis, we take into account amounts alreadyaccrued on the balance sheet. In our opinion, although theoutcomes of these proceedings are uncertain, they shouldnot have a material adverse effect on our financialposition, results of operations or cash flows.\\nWe have contractual obligations to purchase certain\\ngoods or services from various other parties. Ourpurchase obligations are expected to be approximately$12,313 in 2023, $11,424 in total for 2024 and 2025, $2,457 intotal for 2026 and 2027 and $821 in total for yearsthereafter.\\nSee Note 12 for a discussion of collateral and credit-risk\\ncontingencies.\\nNOTE 22.',\n", " 'NOTE 22. ADDITIONAL FINANCIAL INFORMATION\\nDecember 31,\\nConsolidated Balance Sheets 2022 2021\\nAccounts payable and accrued liabilities:\\nAccounts payable $ 31,101 $ 29,511\\nAccrued payroll and commissions 1,605 2,082\\nCurrent portion of employee benefit obligation 1,173 1,234\\nCurrent portion of Mobility preferred interests12,670 —\\nAccrued interest 2,160 2,438\\nAccrued taxes 798 1,148\\nOther 3,137 2,682\\nTotal accounts payable and accrued liabilities $ 42,644 $ 39,095\\n1Reported as noncontrolling interest in 2021.',\n", " '(See Note 16)\\nConsolidated Statements of Income 2022 2021 2020\\nAdvertising expense $ 2,462 $ 2,732 $ 2,705\\nInterest expense incurred $ 7,402 $ 7,670 $ 7,850\\nCapitalized interest – capital expenditures (174) (173) (123)\\nCapitalized interest – spectrum1(1,120) (781) —\\nTotal interest expense $ 6,108 $ 6,716 $ 7,727\\n1Included in “Acquisitions, net of cash acquired” on our consolidated statements of cash flows.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n?;',\n", " 'Cash and Cash Flows We typically maintain our restricted cash balances for purchases and sales of certain investment\\nsecurities and funding of certain deferred compensation benefit payments.\\nThe following table summarizes cash and cash equivalents and restricted cash balances contained on our consolidated\\nbalance sheets:\\nDecember 31,\\nCash and Cash Equivalents and Restricted Cash 2022 2021 2020 2019\\nCash and cash equivalents from continuing operations $ 3,701 $ 19,223 $ 7,924 $ 9,702\\nCash and cash equivalents from discontinued operations — 1,946 1,816 2,428\\nRestricted cash in Prepaid and other current assets 1 39 6 9\\nRestricted cash in Other Assets 91 144 121 96\\nCash and cash equivalents and restricted cash $ 3,793 $ 21,316 $ 9,870 $ 12,295\\nThe following tables summarize certain cash flow activities from continuing operations:\\nConsolidated Statements of Cash Flows 2022 2021 2020\\nCash paid (received) during the year for:\\nInterest $ 7,772 $ 7,485 $ 8,010\\nIncome taxes,',\n", " '772 $ 7,485 $ 8,010\\nIncome taxes, net of refunds1592 252 577\\n1Total cash income taxes paid, net of refunds, by AT&T was $696, $700 and $993 for 2022, 2021 and 2020, respectively.\\nPurchase of property and equipment $ 19,452 $ 15,372 $ 14,567\\nInterest during construction - capital expenditures1174 173 123\\nTotal Capital expenditures $ 19,626 $ 15,545 $ 14,690\\nBusiness acquisitions $— $— $1 2\\nSpectrum acquisitions 9,080 24,672 1,613\\nInterest during construction - spectrum11,120 781 —\\nTotal Acquisitions, net of cash acquired $ 10,200 $ 25,453 $ 1,625\\n1Total capitalized interest was $1,294, $954 and $123 for 2022, 2021 and 2020, respectively.',\n", " 'Noncash Investing and Financing Activities In\\nconnection with capital improvements and the acquisitionof other productive assets, we negotiate favorablepayment terms (referred to as vendor financing), whichare reported as financing activities in our statements ofcash flows when paid. We recorded $5,817 of vendorfinancing commitments related to capital investments in2022, $5,282 in 2021 and $4,664 in 2020.\\nTotal vendor financing payables included in our December\\n31, 2022 consolidated balance sheet were approximately$6,147, with $4,592 due within one year (in “Accountspayable and accrued liabilities”) and the remainderpredominantly due within five years (in “Other noncurrentliabilities”).Labor Contracts As of January 31, 2023, we employed\\napproximately 160,700 persons. Approximately 42% of ouremployees are represented by the CommunicationsWorkers of America (CWA), the International Brotherhoodof Electrical Workers (IBEW) or other unions. Afterexpiration of in place agreements with these groups, workstoppages or labor disruptions may occur in the absenceof new contracts or other agreements being reached.',\n", " 'Themain contracts included the following:\\n• A contract covering approximately 7,000 Mobility\\nemployees in nine states, for which we reachedtentative agreement in February 2023.\\n• A contract covering approximately 400 employees\\nsupporting internet-based products is set to expire inJuly 2023.\\n• A contract covering approximately 200 Mobility\\nemployees in Illinois is set to expire in May 2023.\\n??',\n", " 'NOTE 23. DISCONTINUED OPERATIONS\\nUpon the separation and distribution, the WarnerMedia\\nbusiness met the criteria for discontinued operations. Fordiscontinued operations, we also evaluated transactionsthat were components of AT&T’s single plan of a strategicshift, including dispositions that previously did notindividually meet the criteria due to materiality, and havedetermined discontinued operations to be comprised ofWarnerMedia, Vrio, Xandr and Playdemic.\\nThe following is a summary of operating results included\\nin income (loss) from discontinued operations for theyears ended:\\n2022 2021 2020\\nRevenues $ 9,454 $ 34,826 $ 28,710\\nOperating Expenses\\nCost of revenues 5,481 19,400 14,269\\nSelling, general and\\nadministrative 2,791 8,275 7,222\\nAsset abandonments and\\nimpairments1— 4,691 3,193\\nDepreciation and amortization 1,172 5,010 5,993\\nTotal operating expenses 9,444 37,376 30,',\n", " '010 5,993\\nTotal operating expenses 9,444 37,376 30,677\\nInterest expense 131 168 198\\nEquity in net income (loss) of\\naffiliates (27) 28 6\\nOther income (expense) - net2(87) 466 (343)\\nTotal other income (expense) (245) 326 (535)\\nNet loss before income taxes (235) (2,224) (2,502)\\nIncome tax expense (benefit) (54) 73 (203)\\nNet loss from discontinued\\noperations $ (181) $ (2,297) $ (2,299)\\n12021 includes $4,555 impairment resulting from our assessment of the\\nrecoverability of Vrio’s net assets. 2020 includes approximately $2,200 ofgoodwill impairment at Vrio and $1,000 from production, content and otherimpairment at WarnerMedia. The implied fair values of the Vrio business wasestimated using both the discounted cash flow as well as market multipleapproaches. The fair values of film productions were estimated using adiscounted cash flow approach. The inputs to all of these approaches areconsidered Level 3.',\n", " 'The inputs to all of these approaches areconsidered Level 3.\\n2“Other income (expense) - net” includes the gain of $706 from Playdemic\\nfor the year ended 2021.The following is a summary of assets and liabilities\\nattributable to discontinued operations, which wereincluded in our historical Consolidated Balance Sheet atDecember 31:\\n2021\\nAssets:\\nCurrent assets $ 9,005\\nNoncurrent Inventories and Theatrical Film and\\nTelevision Production Costs 18,983\\nProperty, Plant and Equipment – Net 4,255Goodwill 40,484Other Intangibles – Net 40,273Other Assets 6,776\\nTotal Assets, discontinued operations $ 119,776\\nLiabilities:\\nCurrent liabilities $ 12,912Other liabilities 20,643\\nTotal Liabilities, discontinued operations $ 33,555\\nIn preparation for close of the separation and distribution,\\non April 7, 2022, Spinco drew $10,000 on its $10,000 termloan credit agreement (Spinco Term Loan), whichconveyed to WBD.',\n", " 'Total debt conveyed wasapproximately $41,600, which included $1,600 of existingWarnerMedia debt, $30,000 of Spinco senior notes issuedin March 2022 and the $10,000 Spinco Term Loan.WarnerMedia cash transfer to Discovery wasapproximately $2,660.Notes to Consolidated Financial Statements (continued)\\nDollars in millions except per share amounts\\n?!',\n", " 'NOTE 24. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)\\nThe following tables represent our quarterly financial results:\\n2022 Calendar Quarter\\nFirst1Second1Third1Fourth1,2Annual\\nTotal Operating Revenues $ 29,712 $ 29,643 $ 30,043 $ 31,343 $ 120,741\\nOperating Income (Loss) 5,537 4,956 6,012 (21,092) (4,587)\\nNet Income (Loss) from\\nContinuing Operations 5,149 4,751 6,346 (23,120) (6,874)\\nNet Income (Loss) from Continuing\\nOperations Attributable to Common Stock 4,747 4,319 5,924 (23,536) (8,546)\\nBasic Earnings (Loss) Per Share\\nAttributable to Common Stock from\\nContinuing Operations3$ 0.66 $ 0.60 $ 0.82 $ (3.20) $ (1.10)\\nDiluted Earnings (Loss) Per Share\\nAttributable to Common Stock from\\nContinuing Operations3$ 0.65 $ 0.59 $ 0.',\n", " '65 $ 0.59 $ 0.79 $ (3.20) $ (1.10)\\n1Includes actuarial gains and losses on pension and postretirement benefit plans (Note 14).\\n2Includes goodwill impairments (Note 9) and an asset abandonment charge (Note 7).\\n3Quarterly earnings per share impacts may not add to full-year earnings per share impacts due to the difference in weighted-average common shares for t he quarters\\nversus the weighted-average common shares for the year.',\n", " '2021 Calendar Quarter\\nFirst1Second1Third1Fourth1Annual\\nTotal Operating Revenues $ 35,877 $ 35,740 $ 31,326 $ 31,095 $ 134,038\\nOperating Income 7,194 7,572 6,237 4,894 25,897Net Income from Continuing Operations 7,586 5,969 5,019 5,202 23,776\\nNet Income from Continuing\\nOperations Attributable to Common Stock 7,143 5,526 4,613 4,802 22,084\\nBasic Earnings Per Share\\nAttributable to Common Stock from\\nContinuing Operations\\n2$ 0.99 $ 0.77 $ 0.64 $ 0.67 $ 3.07\\nDiluted Earnings Per Share\\nAttributable to Common Stock from\\nContinuing Operations2$ 0.97 $ 0.76 $ 0.63 $ 0.66 $ 3.02\\n1Includes actuarial gains and losses on pension and postretirement benefit plans (Note 14).',\n", " '2Quarterly earnings per share impacts may not add to full-year earnings per share impacts due to the difference in weighted-average common shares for t he quarters\\nversus the weighted-average common shares for the year.\\n?¿',\n", " 'The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting\\nprinciples. The integrity and objectivity of the data in these financial statements, including estimates and judgmentsrelating to matters not concluded by year end, are the responsibility of management, as is all other information includedin the Annual Report, unless otherwise indicated.\\nThe financial statements of AT&T Inc. (AT&T) have been audited by Ernst & Young LLP, Independent Registered Public\\nAccounting Firm. Management has made available to Ernst & Young LLP all of AT&T’s financial records and related data,as well as the minutes of stockholders’ and directors’ meetings. Furthermore, management believes that allrepresentations made to Ernst & Young LLP during its audit were valid and appropriate.\\nManagement maintains disclosure controls and procedures that are designed to ensure that information required to be\\ndisclosed by AT&T is recorded, processed, summarized, accumulated and communicated to its management, includingits principal executive and principal financial officers, to allow timely decisions regarding required disclosure, andreported within the time periods specified by the Securities and Exchange Commission’s rules and forms.',\n", " 'Management also seeks to ensure the objectivity and integrity of its financial data by the careful selection of its\\nmanagers, by organizational arrangements that provide an appropriate division of responsibility and by communicationprograms aimed at ensuring that its policies, standards and managerial authorities are understood throughout theorganization.\\nThe Audit Committee of the Board of Directors meets periodically with management, the internal auditors and the\\nindependent auditors to review the manner in which they are performing their respective responsibilities and to discussauditing, internal accounting controls and financial reporting matters. Both the internal auditors and the independentauditors periodically meet alone with the Audit Committee and have access to the Audit Committee at any time.\\nAssessment of Internal ControlThe management of AT&T is responsible for establishing and maintaining adequate internal control over financial\\nreporting, as defined in Rule 13a-15(f) or 15d-15(f) under the Securities Exchange Act of 1934. AT&T’s internal controlsystem was designed to provide reasonable assurance to the company’s management and Board of Directors regardingthe preparation and fair presentation of published financial statements.\\nAT&T management assessed the effectiveness of the company’s internal control over financial reporting as of\\nDecember 31, 2022.',\n", " 'In making this assessment, it used the criteria set forth by the Committee of SponsoringOrganizations of the Treadway Commission (COSO) in Internal Control – Integrated Framework (2013 framework). Based\\non its assessment, AT&T management believes that, as of December 31, 2022, the company’s internal control overfinancial reporting is effective based on those criteria.\\nErnst & Young LLP, the independent registered public accounting firm that audited the financial statements included in\\nthis Annual Report, has issued an attestation report on the company’s internal control over financial reporting.\\nJohn T. Stankey\\nChief Executive Officer and PresidentPascal Desroches\\nSenior Executive Vice President and Chief Financial OfficerReport of Management\\n!\\x08',\n", " 'To the Stockholders and the Board of Directors of AT&T Inc.\\nOpinion on the Financial StatementsWe have audited the accompanying consolidated balance sheets of AT&T Inc. (the Company) as of December 31, 2022\\nand 2021, the related consolidated statements of income, comprehensive income, cash flows and changes instockholders’ equity for each of the three years in the period ended December 31, 2022, and the related notes andfinancial statement schedule listed in Item 15(a) (collectively referred to as the “consolidated financial statements”). Inour opinion, the consolidated financial statements present fairly, in all material respects, the financial position of theCompany at December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years inthe period ended December 31, 2022, in conformity with U.S. generally accepted accounting principles.',\n", " 'generally accepted accounting principles.\\nWe also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United\\nStates) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2022, based on criteriaestablished in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of theTreadway Commission (2013 framework) and our report dated February 13, 2023 expressed an unqualified opinionthereon.\\nBasis for OpinionThese financial statements are the responsibility of the Company’s management. Our responsibility is to express an\\nopinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with thePCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securitieslaws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\\nWe conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and\\nperform the audit to obtain reasonable assurance about whether the financial statements are free of materialmisstatement, whether due to error or fraud.',\n", " 'Our audits included performing procedures to assess the risks of materialmisstatement of the financial statements, whether due to error or fraud, and performing procedures that respond tothose risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in thefinancial statements. Our audits also included evaluating the accounting principles used and significant estimates madeby management, as well as evaluating the overall presentation of the financial statements. We believe that our auditsprovide a reasonable basis for our opinion.\\nCritical Audit MattersThe critical audit matters communicated below are matters arising from the current period audit of the financial\\nstatements that were communicated or required to be communicated to the audit committee and that: (1) relate toaccounts or disclosures that are material to the financial statements and (2) involved our especially challenging,subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion onthe consolidated\\nfinancial statements, taken as a whole, and we are not, by communicating the critical audit matters\\nbelow, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.',\n", " 'Discount rates used in determining pension and postretirement benefit obligations\\nDescription of\\nthe MatterAt December 31, 2022, the Company’s defined benefit pension obligation was $42,828 million and\\nexceeded the fair value of pension plan assets of $40,874 million, resulting in an unfunded benefitobligation of $1,954 million. Additionally, at December 31, 2022, the Company’s postretirement benefitobligation was $7,280 million and exceeded the fair value of postretirement plan assets of $2,160million, resulting in an unfunded benefit obligation of $5,120 million. As explained in Note 14 to theconsolidated financial statements, the Company updates the assumptions used to measure the definedbenefit pension and postretirement benefit obligations, including discount rates, at December 31 orupon a remeasurement event. The Company determines the discount rates used to measure theobligations based on the development of a yield curve using high-quality corporate bonds selected toyield cash flows that correspond to the expected timing and amount of the expected future benefitpayments.',\n", " 'Auditing the defined benefit pension and postretirement benefit obligations was complex due to the\\njudgmental nature of the actuarial assumptions made by management, primarily the discount rate,used in the Company’s measurement process. The discount rate has a significant effect on themeasurement of the defined benefit pension and postretirement benefit obligations, and auditing thediscount rate was complex because it required an evaluation of the credit quality of the corporatebonds used to develop the discount rate and the correlation of those bonds’ cash inflows to the timingand amount of future expected benefit payments.Report of Independent Registered Public Accounting Firm\\n!',\n", " 'How We\\nAddressed theMatter in OurAuditWe obtained an understanding, evaluated the design and tested the operating effectiveness of certain\\ncontrols over management’s review of the determination of the discount rates used in the definedbenefit pension and postretirement benefit obligations calculations.\\nTo test the determination of the discount rate used in the calculation of the defined benefit pension\\nand postretirement benefit obligations, we performed audit procedures that focused on evaluating,with the assistance of our actuarial specialists, the determination of the discount rates, among otherprocedures. For example, we evaluated the selected yield curve used to determine the discount ratesapplied in measuring the defined benefit pension and postretirement benefit obligations. As part of thisassessment, we considered the credit quality of the corporate bonds that comprised the yield curveand compared the timing and amount of cash flows at maturity with the expected amounts andduration of the related benefit payments.\\nEvaluation of goodwill for impairment\\nDescription of\\nthe MatterAt December 31, 2022, the Company’s goodwill balance was $67,895 million. As discussed in Note 1 to\\nthe consolidated financial statements, reporting unit goodwill is tested at least annually forimpairment.',\n", " 'Estimating fair values in connection with these impairment evaluations involves theutilization of discounted cash flow and market multiple approaches. As described in Note 9 to theconsolidated financial statements, impairment charges of $13,478 million in the Business Wirelinereporting unit, $10,508 million in the Consumer Wireline reporting unit and $826 million in the Mexicoreporting unit were recorded during the year.\\nAuditing management’s annual goodwill impairment test for the Consumer Wireline and Business\\nWireline reporting units was complex because the estimation of fair values involves subjectivemanagement assumptions, such as projected terminal growth rates, projected long-term EBITDAmargins, and weighted average cost of capital, and complex valuation methodologies, such as thediscounted cash flow and market multiple approaches. Assumptions used in these valuation models areforward-looking, and changes in these assumptions can have a material effect on the determination offair value.\\nHow We\\nAddressed theMatter in OurAuditWe obtained an understanding, evaluated the design and tested the operating effectiveness of certain\\ncontrols over the Company’s impairment evaluation processes. Our procedures included testingcontrols over management’s review of the valuation models and its determination of the significantassum\\nptions described above.',\n", " 'Our audit procedures to test management’s impairment evaluations included, among others, assessing\\nthe valuation methodologies and significant assumptions discussed above and the underlying dataused to develop such assumptions. For example, we compared the significant assumptions to currentindustry, market and economic trends, and other guideline companies in the same industry. Whereappropriate, we evaluated whether changes to the Company’s business and other factors would affectthe significant assumptions. We also assessed the historical accuracy of management’s estimates andperformed independent sensitivity analyses. We involved our valuation specialists to assist us inevaluating the methodologies and auditing the assumptions used to calculate the estimated fair valuesof the Company’s reporting units.\\nWe have served as the Company’s auditor since 1999.\\nDallas, Texas\\nFebruary 13, 2023Report of Independent Registered Public Accounting Firm (continued)\\n!',\n", " 'To the Stockholders and the Board of Directors of AT&T Inc.\\nOpinion on Internal Control Over Financial Reporting\\nWe have audited AT&T Inc.’s internal control over financial reporting as of December 31, 2022, based on criteria\\nestablished in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of theTreadway Commission (2013 framework) (the COSO criteria). In our opinion, AT&T Inc. (the Company) maintained, in allmaterial respects, effective internal control over financial reporting as of December 31, 2022, based on the COSO criteria.\\nWe also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United\\nStates) (PCAOB), the 2022 consolidated financial statements of the Company and our report dated February 13, 2023expressed an unqualified opinion thereon.\\nBasis for OpinionThe Company’s management is responsible for maintaining effective internal control over financial reporting and for its\\nassessment of the effectiveness of internal control over financial reporting included in the accompanying Report ofManagement. Our responsibility is to express an opinion on the Company’s internal control over financial reporting basedon our audit.',\n", " 'We are a public accounting firm registered with the PCAOB and are required to be independent with respectto the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of theSecurities and Exchange Commission and the PCAOB.\\nWe conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and\\nperform the audit to obtain reasonable assurance about whether effective internal control over financial reporting wasmaintained in all material respects.\\nOur audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a\\nmaterial weakness exists, testing and evaluating the design and operating effectiveness of internal control based on theassessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe thatour audit provides a reasonable basis for our opinion.\\nDefinition and Limitations of Internal Control Over Financial ReportingA company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding\\nthe reliability of financial reporting and the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles.',\n", " 'A company’s internal control over financial reporting includes those policiesand procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions arerecorded as necessary to permit preparation of financial statements in accordance with generally accepted accountingprinciples, and that receipts and expenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect onthe financial statements.\\nBecause of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.\\nAlso, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may becomeinadequate because of changes in conditions, or that the degree of compliance with the policies or procedures maydeteriorate.\\nDallas, Texas\\nFebruary 13, 2023Report of Independent Registered Public Accounting Firm\\n!.',\n", " '84References\\n4Coverage not available everywhere. Based upon AT&T analysis of\\nthird-party data.\\n5Based on fiber to the home households using the latest publicly\\navailable data.\\n6https://ntia.gov/category/data-central1Net Debt of $132.2 billion at December 31, 2022 is calculated as TotalDebt of $135.9 billion less Cash and Cash Equivalents of $3.7 billion.Net Debt of $156.4 billion at December 31, 2021 is calculated as TotalDebt of $175.6 billion less Cash and Cash Equivalents of $19.2 billion.\\n2Wireless EBITDA is the same as Mobility EBITDA. EBITDA is operatingincome before depreciation and amortization.\\n3Based on overall covera ge in the U.S. Cove rage not available everywhere.',\n", " '85Committees of the Board:\\n(1) Audit(2) Corporate Development and Finance(3) Executive(4) Governance and Policy(5) Human Resources\\n(Information is provided\\nas of February 13, 2023.)\\nWilliam E. Kennard, 66(3,4)\\nIndependent Chairman of the Board\\nFormer U.S. Ambassador to the\\nEuropean Union\\nFormer Chairman of the Federal\\nCommunications Commission\\nDirector since 2014Background: Law,\\ntelecommunications,\\npublic policy\\nStephen J. Luczo, 65\\n(1,2)\\nManaging Partner\\nCrosspoint Capital Partners, L.P.Director since 2019Background: Technology, finance,\\noperations management\\nMatthew K. Rose, 63\\n(2,5)\\nRetired Chairman\\nand Chief Executive O fficer\\nBurlington Northern Santa Fe, LLCDirector since 2010Background: Freight transport\\nLuis A. Ubiñas, 60\\n(1,4)\\nChairman\\nThe Statue of Liberty –\\nEllis Island Foundation\\nDirector since June 2021Background: Telecommunications,\\ngovernment, nonpro fitsMichael B. McCallister,',\n", " 'government, nonpro fitsMichael B. McCallister, 70\\n(1,5)\\nRetired Chairman of the Board\\nand Chief Executive O fficer\\nHumana Inc.Director since 2013Background: Health care\\nJohn Stankey, 60\\nChief Executive O fficer and President\\nAT&T Inc.Director since 2020Background: Telecommunications,\\ntechnologyGlenn H. Hutchins, 67\\n(2,3,4)\\nChairman\\nNorth Island and North Island VenturesCo-FounderSilver LakeDirector since 2014Background: Technology, public policy\\nBeth E. Mooney, 68\\n(3,4,5)\\nRetired Chairman\\nand Chief Executive O fficer\\nKeyCorpDirector since 2013Background: Banking\\nCynthia B. Taylor, 61\\n(1,3)\\nPresident and Chief Executive\\nOfficer\\nOil States International, Inc.Director since 2013Background: Public accounting,\\noil and gas\\nAT&T Inc.',\n", " 'Director since 2013Background: Public accounting,\\noil and gas\\nAT&T Inc. Board of Directors\\nScott T. Ford, 60(2,3,5)\\nChief Executive O fficer\\nWestrock Co ffee Company\\nDirector since 2012Background: Telecommunications',\n", " '86(Information is provided\\nas of February 13, 2023.)Executive O fficers of AT&T Inc. and Its A ffiliates\\nJohn Stankey, 60\\nChief Executive O fficer\\nand President\\nEd Gillespie, 61\\nSenior Executive Vice President –\\nExternal and Legislative A ffairs\\nAT&T Services, Inc.',\n", " 'Lori Lee, 57\\nGlobal Marketing O fficer and\\nSenior Executive Vice President –InternationalThaddeus Arroyo, 59\\nChief Strategy\\nand Development O fficer\\nDavid Huntley, 64\\nSenior Executive Vice President\\nand Chief Compliance O fficer\\nJeremy Legg, 53\\nChief Technology O fficer\\nAT&T Services, Inc.Pascal Desroches, 58\\nSenior Executive Vice President\\nand Chief Financial O fficer\\nKellyn Smith Kenny, 45\\nChief Marketing\\nand Growth O fficer\\nDavid McAtee II, 54\\nSenior Executive Vice President\\nand General Counsel\\nJeffMcElfresh, 52\\nChief Operating O fficerAngela Santone, 51\\nSenior Executive Vice President –\\nHuman Resources',\n", " '[This page intentionally le ftblank.]',\n", " '[This page intentionally le ftblank.]',\n", " '© 2023 AT&T Intellectual Property. AT&T and the globe logo are registered trademarks and service marks of AT&T \\n\\x03 ¢ÁǸ¿¿¸¶ÇÈ´¿\\x03©ÅÂøÅÇÌ\\x03´Á·\\x8dÂÅ\\x03\\x9a\\xad\\x86\\xad\\x03´ï¿¼´Ç¸·\\x03¶ÂÀôÁ¼¸Æ\\x04\\x03\\x9f¼ÅÆǧ¸Ç\\x03´Á·\\x03Ç»¸\\x03\\x9f¼ÅÆǧ¸Ç\\x03¿ÂºÂ\\x03´Å¸\\x03Ÿº¼ÆǸŸ·\\x03ÇÅ´·¸À´Å¾Æ\\x03´Á·\\x03\\x03\\n\\x03 ƸÅɼ¶¸\\x03À´Å¾Æ\\x03¹\\x03Ç»¸\\x03\\x9f¼ÅÆÇ\\x03«¸ÆÃÂÁ·¸Å\\x03§¸ÇÊž\\x03\\x9aÈǻ¿Ç',\n", " 'ÇÊž\\x03\\x9aÈǻ¿ÇÌ\\x04\\x03\\x9a¿¿\\x03ÂÇ»¸Å\\x03À´Å¾Æ\\x03´Å¸\\x03Ç»¸\\x03ÃÅÂøÅÇÌ\\x03¹\\x03Ç»¸¼Å\\x03ŸÆø¶Ç¼É¸\\x03ÂÊÁ¸ÅÆ\\x04\\n\\x03\\x03\\x03\\x03\\x9aÁÁÈ´¿\\x03«¸ÃÂÅÇ\\x03ÃżÁǸ·\\x03ÂÁ\\x03ôøÅ\\x03¶ÂÁÇ´¼Á¼Áº\\x03\\x1d\\x1cY\\x03ÃÂÆÇ\\x88¶ÂÁÆÈÀ¸Å\\x03Ÿ¶Ì¶¿¸·\\x03¶ÂÁǸÁÇ\\x03Toll-Free Stockholder Hotline \\nCall us at 1-800-35 1-7221 between 8 a.m.',\n", " 'at 1-800-35 1-7221 between 8 a.m. and \\n#\\x03Ã\\x04À\\x04\\x03\\x9c¸ÁÇÅ´¿\\x03\\xad¼À¸\\x06\\x03¦ÂÁ·´Ì\\x03Ç»ÅÂȺ»\\x03\\x9fż·´Ì \\n(TDD 1-888-403-9700) for help with: \\n•Common stock account inquiries\\n•\\x03 «¸ÄȸÆÇÆ\\x03¹ÂÅ\\x03´ÆƼÆÇ´Á¶¸\\x03ʼǻ\\x03ÌÂÈÅ\\x03¶ÂÀÀÂÁ\\x03\\x03\\nstock account, including stock transfers\\n•\\x03 ¢Á¹ÂÅÀ´Ç¼ÂÁ\\x03ÂÁ\\x03\\xad»¸\\x03\\x9d¼Å¸¶Ç¬\\x9e«¯¢\\x9c\\x9eÎ\\x03¢ÁɸÆÇÀ¸ÁÇ\\x03\\x03\\nProgram for Stockholders of AT&T Inc.',\n", " '(sponsored \\n and administered by Computershare Trust \\n\\x03\\x03\\x03\\x03\\x9cÂÀôÁÌ\\x06\\x03§\\x04\\x9a\\x04\\x8c\\nWritten Stockholder Requests \\nPlease mail all account inquiries and other requests \\nf\\nor assistance regarding your stock ownership to:\\nAT&T Inc. \\nc/o Computershare Trust \\x03 \\x9cÂÀôÁÌ\\x06\\x03§\\x04\\x9a\\x04 \\nP .O. Box 43078 \\n©ÅÂɼ·¸Á¶¸\\x06\\x03«¢\\x03\\x1c\\x1e% \\x1c\\x88\\x1f\\x1c#$ \\nYou may also reach the transfer agent for AT&T Inc. \\nat att@computershare.com or visit the website at \\ncomputershare.com/att\\nDirectSERVICE Investment Program \\n\\xad»¸\\x03\\x9d¼Å¸¶Ç¬\\x9e«¯¢\\x9c\\x9e\\x03¢ÁɸÆÇÀ¸ÁÇ\\x03©ÅºŴÀ \\nf\\nor Stockholders of AT&T Inc.',\n", " 'is sponsored and \\nadministered by Computershare Trust Company, \\n§\\x04\\x9a\\x04\\x03\\xad»¸\\x03ÃźŴÀ\\x03´¿¿ÂÊÆ\\x03¶ÈÅŸÁÇ\\x03ÆǶ¾»Â¿·¸ÅÆ to reinvest dividends or purchase additional \\x9a\\xad\\x86\\xad\\x03¢Á¶\\x04\\x03ÆǶ¾\\x04\\x03\\x9fÂÅ\\x03ÀŸ\\x03¼Á¹ÂÅÀ´Ç¼ÂÁ\\x06\\x03¶´¿¿ \\n1-800-351-7221Stock Trading Information \\n\\x9a\\xad\\x86\\xad\\x03¢Á¶\\x04\\x03¼Æ\\x03¿¼ÆǸ·\\x03ÂÁ\\x03Ç»¸\\x03§¸Ê\\x03²Âž\\x03¬Ç¶¾\\x03\\x9e˶»´Áº¸\\x04\\x03Tick\\ner symbol: T\\nInformation on the Internet Information about AT&T Inc. is available on the int\\nernet at about.att.com\\nAnnual Meeting The 2023 Annual Meeting of Stockholders of AT&T Inc.',\n", " 'will be c\\nonducted virtually on the internet at 3:30 p.m. \\n\\x9c¸ÁÇÅ´¿\\x03\\xad¼À¸\\x06\\x03\\xad»ÈÅÆ·´Ì\\x06\\x03¦´Ì\\x03\\x1d$\\x06\\x03\\x1e\\x1c\\x1e\\x1f\\x04\\x03\\xad»¸Å¸\\x03ʼ¿¿\\x03µ¸ \\nÁÂ\\x03¼Á\\x88øÅÆÂÁ\\x03À¸¸Ç¼Áº\\x04\\x03\\xad»¸\\x03À¸¸Ç¼Áº\\x03ʼ¿¿\\x03µ¸\\x03´¶¶¸ÆƼµ¿¸ \\nat meetnow.global/ATT2023\\nSEC Filings \\nAT&T Inc.’s U.S. Securities and Exchange \\x9cÂÀÀ¼ÆƼÂÁ\\x03迼ÁºÆ\\x06\\x03¼Á¶¿È·¼Áº\\x03Ç»¸\\x03¿´Ç\\n¸ÆÇ\\x03\\x1d\\x1c\\x88¤ \\nand proxy statement, are available on our website at investors.att.',\n", " 'are available on our website at investors.att.com\\nInvestor Relations \\nSecurities analysts and other members of the ÃÅ\\n¹¸ÆƼÂÁ´¿\\x03èÁ´Á¶¼´¿\\x03¶ÂÀÀÈÁ¼ÇÌ\\x03À´Ì\\x03¶ÂÁÇ´¶Ç \\nÇ»¸\\x03¢ÁɸÆÇÂÅ\\x03«¸¿´Ç¼ÂÁÆ\\x03ÆÇ´æ\\x03´Æ\\x03¿¼ÆǸ·\\x03ÂÁ\\x03ÂÈÅ website at investors.att.com\\nIndependent Auditor \\nErnst & Y \\noung LLP \\n\\x1e\\x1f\\x1e\\x1f\\x03¯¼¶ÇÂÅÌ\\x03\\x9aɸ\\x04\\x06\\x03¬È¼Ç¸\\x03\\x1e\\x1c\\x1c\\x1c \\n\\x9d´¿¿´Æ\\x06\\x03\\xad±\\x03#!',\n", " '%\\n\\x9cÂÅÃÂŴǸ\\x03¨ï¶¸Æ\\x03´Á·\\x03§ÂÁ\\x88¬Ç¶¾»Â¿·¸Å\\x03¢ÁÄȼż¸Æ \\nAT&T Inc. 208 S\\n. Akard St. \\nDallas, TX 75202 \\x1e\\x1d\\x1c\\x88$\\x1e\\x1d\\x88 \\x1d\\x1c!Stockholder Information\\nF1157donD1R1.indd 4-6 3/7/23 5:15 PM',\n", " 'F1157donD1R1.indd 1-3 3/2/23 12:50 PM208 S. Akard St., Dallas, TX 75202'],\n", " 'ATT_CompanyReport_Annual_20230126.pdf': ['Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 1 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;\\n4 Jan 2023 06:00, UTC\\nMichael Hodel\\nDirector\\nMorningstar\\n+1 (312) 696-6578\\nmichael.hodel@morningstar.',\n", " 'hodel@morningstar.com\\nContents\\nAnalyst Note (25 Jan 2023)\\nBusiness Description\\nBusiness Strategy & Outlook (25 Jan 2023)\\nBulls Say / Bears Say (26 Jan 2023)\\nFair Value and Profit Drivers (26 Jan 2023)\\nEconomic Moat (25 Jan 2023)\\nMoat Trend (25 Jan 2023)\\nRisk and Uncertainty (30 Sep 2022)\\nFinancial Strength (26 Jan 2023)\\nCapital Allocation (30 Sep 2022)\\nFinancials\\nRecent Analyst Notes\\nResearch Methodology for Valuing \\nCompanies\\nImportant Disclosure\\nThe conduct of Morningstar’s analysts is governed by Code of \\nEthics/Code of Conduct Policy, Personal Security Trading Policy \\n(or an equivalent of), and Investment Research Policy. For \\ninformation regarding conflicts of interest, please visit: http://\\nglobal.morningstar.com/equitydisclosures.\\nThe primary analyst covering this company does not own its \\nstock.\\nReporting Currency: USD | Trading Currency: USD\\nCurrency amounts expressed with \"$\" are in U.S. dollars \\n(USD) unless otherwise denoted.',\n", " 'dollars \\n(USD) unless otherwise denoted.\\n1The ESG Risk Rating Assessment is a representation of \\nSustainalytics’ ESG Risk Rating.Competitors Slowed AT&T During Fourth Quarter, but Growth \\nRemains Solid \\nAnalyst Note Michael Hodel, Director, 25 Jan 2023\\nAT&T isn’t attracting as many wireless customers as it was a year ago, but it continues to post solid results. \\nCustomer retention was strong, but Verizon and T-Mobile seem to have effectively countered AT&T’s promotional \\nefforts, which began in earnest about two years ago. Management expects wireless customer additions will \\ndecline in 2023 as industry growth slows from the torrid pace of the past couple years, which will benefit cash \\nflow, but the firm also signaled that it will work to continue gaining share. We are maintaining our $25 fair value \\nestimate and think the stock remains modestly undervalued.\\n \\nAT&T added 656,000 postpaid phone customers during the fourth quarter, down from 884,000 a year ago and \\nplacing it between T-Mobile (927,000 net additions) and Verizon (217,000).',\n", " 'The rate of customer defections \\n(churn) was flat versus the prior quarter, bucking the usual seasonal uptick as the impact of price increases taken \\nover the summer appears to have run its course. On the weak side, however, the firm’s share of new customer \\ndecisions (gross customer additions) dipped during the quarter. Of the big three carriers, only AT&T attracted \\nfewer gross additions than in the prior quarter.\\n \\nWireless service revenue increased 5.2% versus the prior year during the quarter. AT&T’s postpaid phone \\ncustomer base has grown 3.5% over the past year and revenue per customer was 2.5% higher. The slowdown in \\ncustomer additions and a slower customer upgrade pace pulled equipment revenue lower but provided a lift to \\nprofitability. The wireless segment EBITDA margin increased nearly 3 percentage points versus a year ago to \\n38%.\\nFinancial Summary and Key Statistics \\nActual Forecast\\n2021 2022 2023 2024\\nRevenue (USD Mil) 118,208 120,741 121,939 124,557\\nRevenue Growth % 4.4 2.1 1.0 2.',\n", " '557\\nRevenue Growth % 4.4 2.1 1.0 2.2\\nOperating Income (Mil) 22,116 22,911 25,381 26,565\\nOperating Margin % 18.7 19.0 20.8 21.3\\nAdjusted EBITDA (Mil) 39,849 13,434 42,956 44,640\\nAdjusted EBITDA Margin % 33.7 11.1 35.2 35.8\\nEarnings Per Share (Diluted) (USD) 3.01 -1.15 2.59 2.63\\nAdjusted Earnings Per Share (Diluted) (USD) 3.01 2.41 2.87 2.95\\nAdjusted EPS Growth % 91.5 -19.8 18.8 2.8\\nPrice/Earnings 6.2 7.6 7.1 6.9\\nPrice/Book 1.8 1.4 1.4 1.2\\nEV/EBITDA 9.4 26.5 6.9 6.',\n", " '4 26.5 6.9 6.6\\nFree Cash Flow Yield % 12.4 9.2 10.7 12.2\\nSource: Morningstar Valuation Model. Data as of 25 Jan 2023.',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 2 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\n \\nFree cash flow hit $14.1 billion for the year, modestly topping management’s revised target, which it cut from $16 \\nbillion over the summer.',\n", " 'AT&T expects to generate $16 billion of free cash flow in 2023 while it continues to \\ninvest aggressively in its network but with slower customer growth easing working capital needs.\\nConsumer fixed-line revenue increased 2.2% year over year with broadband sales up 6.4%. Broadband net \\ncustomer losses were modestly disappointing at 64,000, up from 20,000 a year ago despite continued expansion \\nof the fiber footprint. We expect AT&T to add net broadband customers in 2023 as a growing portion of \\ncustomers are on the fiber network. Broadband pricing remains solid, as average revenue per fiber customer \\nincreased 9% versus a year ago to nearly $65 per month. EBITDA margins in this segment also continue to \\nexpand nicely, hitting 37% during the quarter, up from 31% a year ago.\\n \\nManagement dialed back fiber network expansion plans somewhat, claiming it will build to around 2.0 million-\\n2.5 million new customer locations annually through 2025, down from 3.5 million-4.0 million targeted previously \\nand around 3 million built in 2022.',\n", " \"The firm still plans to reach 30 million customer locations, though this figure \\nincludes both homes and businesses. AT&T is excited about its venture with BlackRock to build fiber networks \\noutside of the traditional AT&T footprint and the prospects for winning government subsidies to build in rural \\nareas, stating that it will invest capital in whichever format proves the most profitable. We agree that the firm \\nshould explore all options on the table, but we aren’t clear yet why management is slowing the pace of the core \\nnetwork buildout.\\nBusiness Strategy & Outlook Michael Hodel, Director, 25 Jan 2023\\nWe believe AT&T's strategy to invest heavily in its networks makes sense and will serve investors well over the \\nlong term. Aggressively extending fiber and 5G coverage to more locations builds on its core assets—its existing \\nnetwork and customer relationships—and should allow AT&T to gradually expand its share of telecom spending. \\nAT&T is the third-largest wireless carrier in the United States, but we believe it has adequate scale, spectrum, \\nand financial resources relative to both Verizon and T-Mobile to generate solid profitability.\",\n", " \"Also, we believe the \\nindustry’s structure has improved in recent years, with three major players that have little incentive to price \\nirrationally in search of short-term market share gains. We expect the industry will gradually reach competitive \\nbalance as each carrier deploys 5G technology on deep midband spectrum holdings and crafts pricing strategies \\nthat appeal to each market segment.\\nUpstart Dish Network could present challenges in some areas, but we don’t believe it presents a credible threat \\nto the traditional wireless business. Also, AT&T and Dish have a wholesale relationship that should allow AT&T to \\nparticipate in Dish's growth. We expect Dish will focus on emerging wireless applications in the enterprise \\nmarket, an area where AT&T also has a strong presence.\\nAT&T also benefits from its ownership of deep network infrastructure across much of the U.S. and its ability to \\nprovide a range of telecom services. The firm plans to extend fiber to 30 million homes and businesses by the end Sector Industry\\ni Communication \\nServicesTelecom Services\\nBusiness Description\\nThe wireless business contributes about two \\nthirds of AT&T’s revenue following the \\nspinoff of WarnerMedia. The firm is the \\nthird-largest U.S.\",\n", " 'The firm is the \\nthird-largest U.S. wireless carrier, connecting \\n69 million postpaid and 18 million prepaid \\nphone customers. Fixed-line enterprise \\nservices, which account for about 20% of \\nrevenue, include internet access, private \\nnetworking, security, voice, and wholesale \\nnetwork capacity. Residential fixed-line \\nservices, about 10% of revenue, primarily \\nconsist of broadband internet access service. \\nAT&T also has a sizable presence in Mexico, \\nserving 21 million customers, but this \\nbusiness only accounts for 2% of revenue. \\nThe firm still holds a 70% equity stake in \\nsatellite television provider DirecTV but does \\nnot consolidate this business in its financial \\nstatements.',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 3 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nof 2025, up from 22 million today, and has form a joint venture with BlackRock to expand into new areas.',\n", " 'These \\nefforts should allow the company to serve these locations extremely well while also enhancing wireless coverage \\nin the surrounding areas. If the firm hits its targets, it would be the third-largest high-quality fixed-line network in \\nthe U.S. (behind Comcast and Charter) and the only of the three to also own a nationwide wireless network. We \\nexpect AT&T will have the ability to use its combined wireless and fixed-line capabilities to grab market share in \\nthis large and growing territory over the next decade.\\nBulls Say Michael Hodel, Director, 26 Jan 2023\\nuFollowing a period of investment, AT&T will hold a nationwide 5G wireless network with deep spectrum behind it \\nand a fiber network capable of reaching nearly one fourth of the U.S.\\nuAT&T has the scale to remain a strong wireless competitor over the long term. With three dominant carriers, \\nindustry pricing should be more rational going forward.\\nuCombining wireless and fixed-line networks with new technologies and deep expertise makes AT&T a force in \\nenterprise services.',\n", " 'Bears Say Michael Hodel, Director, 26 Jan 2023\\nuThe cost of maintaining dominance in the wireless industry by controlling spectrum has been exceptionally high \\nover the years. AT&T has spent $40 billion over the past three years for licenses with few prospects for \\nincremental revenue.\\nuAdvancing technology will eventually swamp AT&T’s wireless business, enabling a host of firms to enter the \\nmarket, further commoditizing this service.\\nuAT&T’s massive debt load will catch up with it. Even after spinning off Warner with a huge amount of debt, AT&T \\ncarries far higher leverage than it has historically and its dividend payout remains high. \\nFair Value and Profit Drivers Michael Hodel, Director, 26 Jan 2023\\nOur $25 fair value estimate assumes that AT&T will deliver modest revenue growth and gradually expanding \\nmargins over the next several years as its wireless and fiber network investments pay off. Our fair value estimate \\nimplies an enterprise value of 8.0 times our 2023 EBITDA estimate and an 8% free cash flow yield. \\nIn wireless, we expect AT&T will slowly gain market share as it re-establishes its market position.',\n", " 'We believe \\npostpaid revenue per phone customer will grow modestly amid a relatively stable competitive environment, \\nhitting $60 per month in 2027 versus $55 in 2022. We estimate AT&T generates around $1 billion in revenue \\nannually from connected devices, such as cars. We model this revenue roughly doubling over the next five years \\nas things like edge computing gain adoption, but this estimate is highly uncertain. In total, we expect wireless \\nservice revenue will increase 3%-4% annually on average through 2027, with wireless EBITDA margins holding in \\nthe low-40% range, as cost efficiency efforts and benefits from slower customer growth offset rising network \\noperating costs. \\nWe expect the consumer broadband business will deliver steadily improving growth as the fiber network build \\nout matures. We believe this business has an opportunity to sharply increase margins over the next five years as',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 4 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\npenetration rates increase and the old copper network is decommissioned.',\n", " 'We model a 39% segment EBITDA \\nmargin in 2027, but this could prove conservative if legacy costs decline precipitously, especially given the \\nabsence of television content costs. Cable rivals that don’t have sizable television revenue, like Cable One, can \\ngenerate EBITDA margins above 50%. \\nWe expect the enterprise services business will gradually return to growth in the coming years with profitability \\nholding steady as cost-cutting balances the loss of higher-margin legacy services. AT&T hasn’t provided much \\ndetail surrounding the enterprise business, making it more difficult to forecast future results. The firm has said \\npreviously that EBITDA in this segment will likely decline steadily until sometime in 2024. We suspect a large \\nportion of the enterprise business will look similar to the consumer fixed-line business over the longer term, \\nprimarily providing basic connectivity and earning attractive margins. That said, AT&T should benefit as fixed-line \\nand wireless services converge, providing opportunities to create, deliver, and manage more complex offerings. \\nIn total, we believe consolidated revenue can grow 2-3% annually over the next five years.',\n", " \"We expect capital \\nspending will roughly match management’s current plan in 2023 (around $24 billion, including vendor financing \\npayments) to support the fiber network upgrade and 5G deployment. The firm expects capital spending will \\ndecline sharply beyond 2023 but hasn’t provided a budget, likely to maintain flexibility to pursue growth \\nopportunities. We expect wireless network spending will decline in 2024 and beyond but that the firm will \\ncontinue investing heavily in fiber, holding total capital spending around $22 billion annually through 2027. \\nEconomic Moat Michael Hodel, Director, 25 Jan 2023\\nWireless is AT&T's most important business. Returns on capital in wireless have eroded somewhat in recent years \\nas the firm has spent heavily on wireless spectrum and invested to put that spectrum to use. We estimate the \\nwireless business produced a return on capital in 2022 of roughly 8%, or about 10% excluding goodwill, modestly \\nabove our estimate of the firm’s cost of capital. These figures are down from about 10% and 12% in 2018.\",\n", " 'These figures are down from about 10% and 12% in 2018. Over \\nthose four years, segment operating income is up 13% cumulatively while the invested capital base has \\nexpanded about 30%, primarily on $40 billion of spectrum purchases. \\nWe expect that wireless returns will remain ahead of AT&T’s cost of capital. Verizon, AT&T, and T-Mobile \\ndominate the U.S. wireless market, collectively claiming nearly 90% of retail postpaid and prepaid phone \\ncustomers between them and supplying the network capacity to support most other players. Providing solid \\nnationwide coverage requires heavy fixed investments in wireless spectrum and network infrastructure. While a \\nlarger customer base does require incremental investment in network capacity, a significant portion of costs are \\neither fixed or more efficiently absorbed as network utilization reaches optimal levels in more locations. \\nThe benefits of fixed-cost leverage and the difficulty of providing a differentiated wireless offering create an \\nefficient scale advantage in the wireless industry. The massive consolidation across the industry over the past 15 \\nyears and the inability of several interested parties, including Dish Network and Comcast, to enter the market \\nusing their own networks provide evidence of efficient scale.',\n", " 'Comcast relies on Verizon to support its wireless \\nefforts while Dish will use both the AT&T and T-Mobile networks for several years as it attempts to build a',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 5 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nnationwide network, more than a decade after it began assembling a spectrum portfolio.',\n", " 'With three sizable players, we don’t expect the carriers will have an incentive to aggressively poach each other’s \\ncustomers, given how painfully slow market share shifts occur in the business. We also expect the high cost of \\nmaintaining nationwide coverage and its diminutive size will limit Dish’s ability to compete on a large scale in the \\ntraditional wireless business over the long term. Each of the three major carriers has pledged substantial capital \\nreturns to shareholders: AT&T’s new dividend totals $8 billion annually and Verizon’s nearly $11 billion, while T-\\nMobile has said it can repurchase up to $60 billion of its shares through 2025. To support these returns, each of \\nthe carriers has guided investors to expect modest but steady revenue growth over the next several years. These \\nactions indicate that none of the carriers is looking to radically disrupt the current pricing structure in the industry \\nand that each will increase prices as needed to offset any cost pressures that emerge. \\nThe fixed-line enterprise services segment is AT&T’s next largest. We believe this operation holds a solid \\ncompetitive position in a consolidating market.',\n", " 'We believe this operation holds a solid \\ncompetitive position in a consolidating market. AT&T is one of only a handful of companies capable of providing \\ncomplex communications services to business customers with geographically diverse needs. We roughly estimate \\nthis segment earns 10%-15% returns on invested capital excluding goodwill (AT&T’s most recent major \\nacquisition in this area was the 2005 purchase of the legacy AT&T long-distance business). Business services \\nrevenue has steadily declined in recent years, falling to less than $23 billion in 2022 from $29 billion five years \\nearlier. Margins in this segment have held steady, but profits have also declined (EBITDA was less than $9 billion \\n2022 versus $11 billion in 2017). A significant but undisclosed amount of legacy business remains and will \\ncontinue to exert pressure on growth over the next several years, but AT&T has begun to focus its efforts on core \\nnetwork connectivity and services where its assets allow it to deliver unique solutions. Management expects the \\nsegment will near stability in 2023 with growth returning thereafter. \\nAT&T’s last significant business, consumer fixed-line services, doesn’t possess a moat, in our view.',\n", " 'We estimate \\nAT&T’s consumer fixed-line networks reach around 55 million homes, or a bit less than half of the U.S. \\npopulation. This business is challenged competitively across most of this footprint thanks to inferior networks \\nrelative to cable competitors. About 25% of the homes in this service territory subscribe to AT&T’s internet access \\nservice, around half the penetration level Comcast claims. The gap between AT&T and its cable rivals has steadily \\nwidened over the past several years. Customer penetration is critical to driving profitability in the telecom \\nbusiness and AT&T’s modest level has left returns on capital around 5%, by our estimate. \\nAT&T has upgraded about one third of its residential footprint to a fiber-to-the-premises network, which provides \\na much stronger competitive position versus cable. The firm plans to expand the FTTP network aggressively over \\nthe next few years, but it has a long way to go on this effort. We expect price competition will remain rational as \\nAT&T’s fiber network grows, as neither AT&T or the cable companies are likely to risk earning less revenue across \\ntheir existing customer bases over the long term to gain share.',\n", " 'The remainder of AT&T’s business includes the Mexican wireless business. We don’t believe the Mexican \\nbusiness has a moat, operating at a fraction of the scale of market leader America Movil. We wouldn’t be',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 6 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nsurprised if AT&T sold the Mexican wireless business in the near future.',\n", " 'Moat Trend Michael Hodel, Director, 25 Jan 2023\\nWith the T-Mobile/Sprint merger, we expect the wireless industry will begin to benefit from the efficient scale \\nproperties inherent in the business. In other markets around the world, similarly sized competitors typically enjoy \\nbenign competitive environments. Gaining meaningful market share can take months or years of aggressive \\npricing, given how contracts are typically structured, allowing rivals to easily retaliate. Also, we don’t believe Dish \\nNetwork will disrupt the traditional wireless business. The firm has entered the prepaid market, acquiring the \\nSprint prepaid business. However, Dish holds extremely small market share. With a shaky financial position and a \\nnetwork likely better suited to narrow use cases, we don’t believe the firm will make a broad push into the \\ntraditional wireless market.\\nIn the consumer broadband segment, AT&T has steadily lost wallet share across most of the areas it serves, \\nmaking it increasingly difficult to justify the aggressive network spending needed to keep pace with cable rivals \\non a stand-alone basis. However, we think the segment will enjoy significant synergies with the wireless \\nbusiness as 5G technologies are deployed.',\n", " 'We like AT&T’s plan to expand its fiber network in residential areas for \\nthis reason. The transition from the legacy copper network to fiber holds the promise to markedly improve AT&T’s \\ncost structure and overall competitive position but not without significant uncertainty. AT&T plans to overlay \\nabout half its footprint with fiber by 2025. Keeping this effort on budget could be challenging given rising labor \\ncosts and potential zoning challenges. The firm also hopes to essentially abandon another 25% of its fixed-line \\nfootprint, offering only wireless in these areas. Getting these plans past regulators and lawmakers could prove \\ndifficult. \\nIn the fixed-line business services segment, AT&T’s position has strengthened in recent years thanks to \\nconsolidation, which has reduced the number of firms capable of delivering complex services to geographically \\ndiverse customers. The cable companies are expanding their capabilities in this market, but we expect these \\nfirms will need many years to replicate the local and global infrastructure needed to serve larger businesses well \\nwhile also earning healthy margins. More importantly, we don’t have good insight in the revenue mix within AT&\\nT business services segment.',\n", " 'While the firm is well positioned to offer core network connectivity and network \\nmanagement services, technological advances have rendered several major business lines, including legacy voice \\nservice, obsolete.\\nRisk and Uncertainty Michael Hodel, Director, 30 Sep 2022\\nWe have changed our Morningstar Uncertainty Rating to Medium from High to better reflect the volatility we \\nexpect AT&T investors will face relative to our global coverage. Regulation and technological change are the \\nprimary uncertainties facing AT&T. Wireless and broadband services are often considered necessary for social \\ninclusion, in terms of employment and education. If AT&T’s services are deemed insufficient or overpriced, \\nespecially if in response to weak competition, regulators or politicians could step in. The firm is also still \\nresponsible for providing fixed-line phone services to millions of homes across the U.S., including many in small',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 7 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\ntowns and rural areas. It could be compelled to invest more in rural markets even if economic returns are \\ninsufficient.',\n", " 'It could be compelled to invest more in rural markets even if economic returns are \\ninsufficient. \\nRegulators also control the flow of wireless spectrum into the industry, which has created scarcity in the past, \\npushing carriers to pay high prices for licenses. We also suspect when large spectrum blocks are made available, \\nsuch as the 2021 C-band auction, the carriers have felt compelled to bid excessively to keep potential entrants \\nout of the market, especially the cable companies. Regulators around the world have also used spectrum policies \\nto foster additional competition, a strategy the U.S. could follow. \\nOn the technology front, wireless standards continue to evolve, putting more spectrum to use more efficiently. \\nThe cost to deploy wireless networks could come down to the point where numerous new firms are able to enter \\nthe market. The cable companies are already making attempts to leverage their existing networks to provide \\nlimited wireless coverage. Technology could quickly enhance these efforts. While unlikely, in our view, wireless \\ntechnology could also remove the need for AT&T’s fixed-line networks, killing returns on its fiber investments.',\n", " 'Financial Strength Michael Hodel, Director, 26 Jan 2023\\nThe WarnerMedia spinoff took around $35 billion of debt with it, while a $9 billion spectrum purchase in early \\n2022 offset a portion of this benefit. Net debt stood at $132 billion at the end of 2022, leaving net leverage at \\nabout 3.2 times EBITDA. This load is far higher than the firm has operated under in the past: Immediately before \\nits current capital deployment binge began in 2012 (with a round of heavy share repurchases), AT&T typically \\ncarried leverage of around 1.5 times EBITDA. Fortunately, the current debt load still compares reasonably well \\nwith Verizon and T-Mobile, which both carry similar leverage metrics. \\nThe firm also used the Warner spinoff to adjust its dividend policy, targeting a payout of around 40% of free cash \\nflow, down from more than 70% in 2021 (by our calculation). The new payout totals about $8 billion annually, \\ndown from $15 billion in 2021.',\n", " 'The firm has fallen short of management’s cash flow targets over the past year, \\nand it now expects to generate $16 billion of free cash flow in 2023, down from an initial projection of $20 billion. \\nWe still think the dividend policy makes sense, leaving substantial excess cash to reduce leverage and make \\nnetwork investments, which we believe is important to AT&T’s long-term health. \\nWith the reduced dividend payout leaving sizable excess cash flow, the firm plans to repay debt. Management \\ntargets net leverage of 2.5 times EBITDA, which it now believes it can hit in early 2025, rather than its initial \\nexpectation of late 2023. We believe the revised timeline is achievable, absent any major capital outlays. These \\ntargets also exclude $5.2 billion of preferred shares, around $5 billion of preferred interests in various \\nsubsidiaries, and a perpetual preferred stake in the wireless business held by AT&T’s pension plans that pays \\n$560 million annually. The firm used $2.7 billion to repurchase a portion of these preferred interests in late 2022.',\n", " 'Capital Allocation Michael Hodel, Director, 30 Sep 2022\\nWe believe recent capital allocation decisions have destroyed shareholder value and the firm will pay the price \\nfor these missteps for some time to come. As a result, we assign AT&T a Morningstar Capital Allocation Rating as',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 8 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " \"Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nPoor. This assessment stems from our view that a relatively weak balance sheet has hindered AT&T's strategic \\nflexibility and willingness to invest aggressively in the business when needed.\",\n", " \"The state of the balance sheet is \\nthe result of several ill-considered acquisitions, poorly timed share repurchases, and an insistence on increasing \\nthe dividend even as leverage mounted. Management is moving in the right direction, using the Warner spinoff \\nto shift to a dividend policy that better supports needed investment, but AT&T is still playing catch-up. It will need \\nto invest aggressively for the next several years to make its fixed-line network competitive, and it doesn’t expect \\nto get debt leverage below targeted levels until the end of 2023. With cash flow expectations coming down \\nrecently, we wouldn't be surprised if management pushes its targeted leverage date further out. \\nThe firm’s run of heavy capital deployment began in 2012 with a massive share-repurchase program that, at the \\ntime, was billed as a temporary move away from AT&T’s 1.5 times net debt/EBITDA leverage target. The firm \\nrepurchased $27 billion of its shares through 2014 at prices per share in the mid-$30s, pushing leverage to 1.8 \\ntimes.\",\n", " 'The firm then pursued the AWS-3 auction, the DirecTV deal, expansion into Mexico, the Time Warner \\nacquisition, and the recent C-band auction. With leverage nearing 3.2 times EBITDA in early 2021, AT&T’s capital \\nstructure simply didn’t line up well with a large dividend payout. Yet management explicitly expressed support for \\nthe prior dividend until immediately before changing direction, catching long-suffering investors off guard. \\nThese capital forays not only left AT&T with a weaker balance sheet, they also left the firm in a weaker \\ncompetitive position overall, in our view. With 2015’s DirecTV purchase, AT&T acquired a satellite TV business \\nthat was, at best, peaking in maturity. AT&T has sold a stake in the television business but still has exposure to \\nthis declining business. More importantly, as the firm was shifting its strategy, it didn’t invest as aggressively as \\nit should have in its core business. Until recently, it had prioritized short-term margins over maintaining wireless \\nmarket share, allowing T-Mobile to steadily steal customers.',\n", " 'In addition, AT&T has only begrudgingly invested to \\nexpand its fiber optic network in the past. New CEO John Stankey has increased investment to retain customers \\nand has made fiber construction a top priority, which should improve AT&T’s position but will also dent cash flow \\nover at least the next couple of years. \\nAT&T has placed a priority on debt reduction since the Time Warner merger closed, using asset sales as a part of \\nthis effort. Not all these sales have made strategic sense, in our view. For example, the sale of its wireless assets \\nin Puerto Rico seemed odd, given the territory’s strong ties to the U.S. and AT&T’s presence elsewhere in Latin \\nAmerica. Management has also been less than forthright, in our view, concerning the debt load, using preferred \\nshares, receivables securitization, and vendor financing to cloud its financial picture. \\nShareholders have suffered because of AT&T’s choices. The stock returned only 2% annually over the 20 years \\nleading up to the Warner spinoff and 3% over the previous decade, as a declining share price has partially offset \\ndividends paid.',\n", " \"While the telecom industry hasn’t delivered stellar returns in general, with several firms hitting \\nbankruptcy in recent years, AT&T's shares lagged those of nearly every major U.S. telecom peer over that prior \\ndecade, including Verizon (7% returns annually), Comcast (14%), Charter (23%), and T-Mobile (23%). K\",\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 9 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nPrice vs. Fair Value \\n010203040Fair Value: 25.00\\n11 Apr 2022 03:30, UTC\\nLast Close: 20.42\\nOver Valued\\nUnder Valued\\n2018 2019 2020 2021 2022 YTD\\n0.77 1.06 0.80 0.68 0.74 0.82 Price/Fair Value\\n-21.45 44.08 -21.08 -7.23 -1.33 12.',\n", " '45 44.08 -21.08 -7.23 -1.33 12.43 Total Return %\\nMorningstar Rating\\nCompetitors\\nAT&T Inc T Comcast Corp Class A CMCSA Verizon Communications Inc VZ T-Mobile US Inc TMUS\\nFair Value\\n25.00\\nUncertainty : Medium\\nLast Close\\n20.42\\nFair Value\\n60.00\\nUncertainty : Medium\\nLast Close\\n40.10\\nFair Value\\n57.00\\nUncertainty : Low\\nLast Close\\n40.33\\nFair Value\\n165.00\\nUncertainty : Medium\\nLast Close\\n148.07\\nEconomic Moat\\n Narrow\\n Wide\\n Narrow\\n Narrow\\nMoat Trend Stable Stable Stable Stable\\nCurrency USD USD USD USD\\nFair Value 25.00 11 Apr 2022 03:30, UTC 60.00 11 Apr 2022 03:30, UTC1 57.00 11 Apr 2022 03:30, UTC2 165.00 11 Apr 2022 03:30, UTC3\\n1-Star Price 33.75 81.00 71.25 222.',\n", " '75 81.00 71.25 222.75\\n5-Star Price 17.50 42.00 45.60 115.50\\nAssessmentUnder Valued 25 Jan 2023 Significantly \\nUndervalued24 Jan \\n2023Significantly \\nUndervalued24 Jan \\n2023Under Valued 24 Jan 2023\\nMorningstar Rating QQQQ25 Jan 2023 22:28, UTC QQQQQ25 Jan 2023 22:28, UTC QQQQQ25 Jan 2023 22:28, UTC QQQQ25 Jan 2023 22:28, UTC\\nAnalyst Michael Hodel, Director Michael Hodel, Director Michael Hodel, Director Michael Hodel, Director\\nCapital Allocation Poor Standard Standard Standard\\nPrice/Fair Value 0.82 0.67 0.71 0.90\\nPrice/Sales 0.90 1.48 1.24 2.29\\nPrice/Book 1.12 2.14 1.86 2.59\\nPrice/Earnings 7.92 33.69 7.99 119.52\\nDividend Yield 5.',\n", " '92 33.69 7.99 119.52\\nDividend Yield 5.79% 2.72% 6.40% —\\nMarket Cap 136.57 Bil 171.86 Bil 169.76 Bil 181.41 Bil\\n52-Week Range 14.46—22.84 28.39—50.98 32.79—55.51 103.77—154.38\\nInvestment Style Large Value Large Value Large Value Large Growth',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 10 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;\\n4 Jan 2023 06:00, UTC\\nMorningstar Valuation Model Summary\\nFinancials as of 25 Jan 2023 Actual Forecast\\nFiscal Year,',\n", " 'ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nRevenue (USD Mil) 113,238 118,208 120,741 121,939 124,557 128,196 132,267 136,747\\nOperating Income (USD Mil) 23,058 22,116 22,911 25,381 26,565 27,935 29,358 31,098\\nEBITDA (USD Mil) 51,574 44,978 13,434 46,956 47,988 49,327 50,148 52,216\\nAdjusted EBITDA (USD Mil) 40,570 39,849 13,434 42,956 44,640 46,510 48,633 51,073\\nNet Income (USD Mil) 11,284 21,661 -8,727 18,641 18,917 19,558 19,651 20,697\\nAdjusted Net Income (USD Mil) 11,284 21,661 18,311 20,651 21,231 22,',\n", " '284 21,661 18,311 20,651 21,231 22,197 21,911 22,877\\nFree Cash Flow To The Firm (USD Mil) 52,151 4,182 -27 11,474 13,581 15,032 16,393 16,776\\nWeighted Average Diluted Shares Outstanding (Mil) 7,183 7,199 7,587 7,200 7,200 7,200 7,200 7,200\\nEarnings Per Share (Diluted) (USD) 1.57 3.01 -1.15 2.59 2.63 2.72 2.73 2.87\\nAdjusted Earnings Per Share (Diluted) (USD) 1.57 3.01 2.41 2.87 2.95 3.08 3.04 3.18\\nDividends Per Share (USD) 2.08 2.08 1.35 1.11 1.11 1.11 1.11 1.',\n", " '35 1.11 1.11 1.11 1.11 1.11\\nMargins & Returns as of 25 Jan 2023 Actual Forecast\\n3 Year Avg 2020 2021 2022 2023 2024 2025 2026 2027 5 Year Avg\\nOperating Margin % 19.4 20.4 18.7 19.0 20.8 21.3 21.8 22.2 22.7 21.8\\nEBITDA Margin % — 45.5 38.1 11.1 38.5 38.5 38.5 37.9 38.2 —\\nAdjusted EBITDA Margin % 26.9 35.8 33.7 11.1 35.2 35.8 36.3 36.8 37.4 36.3\\nNet Margin % 7.0 10.0 18.3 -7.2 15.3 15.2 15.3 14.9 15.1 15.2\\nAdjusted Net Margin % 14.5 10.',\n", " '1 15.2\\nAdjusted Net Margin % 14.5 10.0 18.3 15.2 16.9 17.1 17.3 16.6 16.7 16.9\\nFree Cash Flow To The Firm Margin % 16.5 46.1 3.5 0.0 9.4 10.9 11.7 12.4 12.3 11.3\\nGrowth & Ratios as of 25 Jan 2023 Actual Forecast\\n3 Year CAGR 2020 2021 2022 2023 2024 2025 2026 2027 5 Year CAGR\\nRevenue Growth % — — 4.4 2.1 1.0 2.2 2.9 3.2 3.4 2.5\\nOperating Income Growth % — — -4.1 3.6 10.8 4.7 5.2 5.1 5.9 6.3\\nEBITDA Growth % 0.0 — — — — — — — — 0.',\n", " '0 — — — — — — — — 0.0\\nAdjusted EBITDA Growth % -21.9 43.8 -1.8 -66.3 219.8 3.9 4.2 4.6 5.0 30.6\\nEarnings Per Share Growth % — — — — — — — — — 5.7\\nAdjusted Earnings Per Share Growth % — — 91.5 -19.8 18.8 2.8 4.6 -1.3 4.4 5.7\\nValuation as of 25 Jan 2023 Actual Forecast\\n2020 2021 2022 2023 2024 2025 2026 2027\\nPrice/Earnings 13.8 6.2 7.6 7.1 6.9 6.6 6.7 6.4\\nPrice/Sales 2.5 1.7 1.5 1.2 1.2 1.1 1.1 1.1\\nPrice/Book 1.0 1.8 1.4 1.4 1.',\n", " '0 1.8 1.4 1.4 1.2 1.1 1.0 0.9\\nPrice/Cash Flow 10.3 8.1 10.9 9.3 8.2 7.4 6.9 6.8\\nEV/EBITDA 11.4 9.4 26.5 6.9 6.6 6.4 6.1 5.8\\nEV/EBIT 20.1 17.0 15.6 11.7 11.2 10.6 10.1 9.5\\nDividend Yield % 9.6 11.2 7.3 5.4 5.4 5.4 5.4 5.4\\nDividend Payout % 132.4 69.1 -117.4 42.9 42.3 40.9 40.7 38.6\\nFree Cash Flow Yield % 9.7 12.4 9.2 10.7 12.2 13.5 14.5 14.',\n", " '2 10.7 12.2 13.5 14.5 14.7\\nOperating Performance / Profitability as of 25 Jan 2023 Actual Forecast\\nFiscal Year, ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nROA % 2.1 4.5 -2.1 4.6 4.5 4.5 4.4 4.5\\nROE % 6.6 18.7 -10.7 19.1 17.4 16.3 15.0 14.4\\nROIC % 4.7 5.8 -1.6 8.1 8.1 8.2 8.3 8.6',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 11 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;\\n4 Jan 2023 06:00, UTC\\nFinancial Leverage Actual Forecast\\nFiscal Year, ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nDebt/Capital % 49.',\n", " '3 70.0 58.3 55.3 53.6 51.2 48.8 47.2\\nAssets/Equity 3.3 5.6 4.1 3.8 3.6 3.4 3.2 3.0\\nNet Debt/EBITDA 2.8 3.5 9.6 2.7 2.6 2.4 2.3 2.1\\nTotal Debt/EBITDA 3.9 4.4 10.1 3.1 3.1 2.9 2.8 2.7\\nEBITDA/ Net Interest Expense 5.1 7.6 2.2 7.2 7.4 7.8 8.1 8.5\\nKey Valuation Drivers as of 25 Jan 2023\\nCost of Equity % 9.0\\nPre-Tax Cost of Debt % 6.5\\nWeighted Average Cost of Capital % 7.4\\nLong-Run Tax Rate % 23.5\\nStage II EBI Growth Rate % 3.',\n", " '5\\nStage II EBI Growth Rate % 3.0\\nStage II Investment Rate % 12.0\\nPerpetuity Year 15\\nAdditional estimates and scenarios available for download at https://pitchbook.com/. Discounted Cash Flow Valuation as of 25 Jan 2023\\nUSD Mil\\nPresent Value Stage I 58,671\\nPresent Value Stage II 114,795\\nPresent Value Stage III 149,633\\nTotal Firm Value 323,100\\nCash and Equivalents 7,234\\nDebt -136,020\\nOther Adjustments -10,479\\nEquity Value 178,685\\nProjected Diluted Shares 7,200\\nFair Value per Share (USD) 25.00',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 12 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;\\n4 Jan 2023 06:00, UTC\\nIncome Statement (USD) Actual Forecast \\nFiscal Year, ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nRevenue (Mil)113,',\n", " '238 118,208 120,741 121,939 124,557 128,196 132,267 136,747\\nCost of Goods Sold (Mil) 72,667 78,233 79,808 78,982 79,917 81,685 83,633 85,673\\nGross Profit (Mil) 40,571 39,975 40,933 42,957 44,641 46,511 48,634 51,074\\nSelling, General, Administrative & Other Expenses (Mil) 1 1 1 1 1 1 1 1\\nAdvertising & Marketing Expenses — — — — — — — —\\nResearch & Development — — — — — — — —\\nDepreciation & Amortization (if reported separately) (Mil) 17,512 17,858 18,021 17,575 18,075 18,575 19,275 19,975\\nAdjusted Operating Income (Mil) 23,058 22,116 22,911 25,381 26,565 27,935 29,358 31,',\n", " '911 25,381 26,565 27,935 29,358 31,098\\nFinancial Non-Cash (Gains)/Losses (Mil) 0 0 27,498 0 0 0 0 0\\nIrregular Cash (Gains)/Losses (Mil) 0 0 0 -4,000 -3,349 -2,817 -1,515 -1,143\\nOperating Income (Mil) 23,058 22,116 -4,587 29,381 29,913 30,752 30,873 32,241\\nNet Interest Expense (Mil) 9,261 -6,451 -1,493 3,000 3,000 3,000 3,000 3,000\\nIncome Tax Expense (Mil) 965 5,220 3,780 6,068 6,325 6,522 6,550 6,872\\nAfter-Tax Items (Mil) -193 -207 -384 -203 -203 -203 -203 -203\\n(Minority Interest) (Mil) -1,355 -1,479 -1,469 -1,',\n", " '355 -1,479 -1,469 -1,469 -1,469 -1,469 -1,469 -1,469\\nNet Income (Mil) 11,284 21,661 -8,727 18,641 18,917 19,558 19,651 20,697\\nAdjusted Net Income (Mil) 11,284 21,661 18,311 20,651 21,231 22,197 21,911 22,877\\nWeighted Average Diluted Shares Outstanding (Mil) 7,183 7,199 7,587 7,200 7,200 7,200 7,200 7,200\\nDiluted Earnings Per Share 1.57 3.01 -1.15 2.59 2.63 2.72 2.73 2.87\\nDiluted Adjusted Earnings Per Share 1.57 3.01 2.41 2.87 2.95 3.08 3.04 3.18\\nDividends Per Common Share (USD)2.08 2.08 1.35 1.',\n", " '08 2.08 1.35 1.11 1.11 1.11 1.11 1.11\\nEBITDA (Mil) 51,574 44,978 13,434 46,956 47,988 49,327 50,148 52,216\\nAdjusted EBITDA (Mil) 40,570 39,849 13,434 42,956 44,640 46,510 48,633 51,073',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 13 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;\\n4 Jan 2023 06:00, UTC\\nKey Cash Flow Items (USD) Actual Forecast as of 25 Jan\\nFiscal Year,',\n", " 'ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nCash from Working Capital (Mil) 3,258 -2,659 4,128 -1,767 -895 -1,089 483 485\\n(Capital Expenditures) (Mil) -15,675 -16,527 -19,626 -24,022 -23,043 -21,793 -21,824 -21,879\\nDepreciation (Mil) 20,277 17,112 17,945 17,500 18,000 18,500 19,200 19,900\\nAmortization (Mil) 8,239 5,750 76 75 75 75 75 75\\nNet New (Investment), Organic (Mil) -8,875 -13,947 -3,451 -7,789 -5,438 -4,382 -2,141 -1,494\\n(Purchases)/Sales of Companies & Assets (Mil) 1,790 -16,713 -10,001 -5,000 -5,000 -5,000 -5,',\n", " '713 -10,001 -5,000 -5,000 -5,000 -5,000 -5,000\\nNet New (Investment), Total (Mil) -7,085 -30,660 -13,452 -12,789 -10,438 -9,382 -7,141 -6,494\\nOther Non-Cash Items, From Cash Flows (Mil) 37,816 13,303 -4,383 75 75 75 75 75\\nFree Cash Flow to the Firm (Mil) 52,151 4,182 -27 11,474 13,581 15,032 16,393 16,776\\nBalance Sheet (USD) Actual Forecast \\nFiscal Year, ends 31 Dec 2020 2021 2022 2023 2024 2025 2026 2027\\nAssets \\nCash and Equivalents (Mil) 9,740 19,223 3,701 2,678 9,202 13,453 18,030 26,858\\nInventory (Mil) 3,695 3,325 3,123 3,246 3,284 3,',\n", " '695 3,325 3,123 3,246 3,284 3,357 3,437 3,521\\nAccounts Receivable (Mil) 20,215 12,313 11,466 11,580 11,828 12,174 12,561 12,986\\nNet Property, Plant and Equipment (Mil) 152,029 121,649 149,259 155,781 160,824 164,117 166,741 168,721\\nGoodwill (Mil) 135,259 92,740 67,895 67,895 67,895 67,895 67,895 67,895\\nOther Intangibles (Mil) 146,316 119,221 129,446 134,371 139,296 144,221 149,146 154,071\\nOther Operating Assets (Mil) 56,727 57,207 34,430 34,430 34,430 34,430 34,430 34,',\n", " '430 34,430 34,430 34,430 34,430 34,430\\nNon-Operating Assets (Mil) 0 0 0 0 0 0 0 0\\nTotal Assets (Mil) 525,761 427,678 402,853 413,513 430,293 443,180 455,773 472,014\\nLiabilities \\nAccounts Payable (Mil) 49,032 39,095 42,644 41,114 40,506 39,835 40,786 41,780\\nDebt (Mil) 157,245 176,876 136,020 134,027 137,460 137,169 135,843 138,385\\nOther Operating Liabilities (Mil) 121,968 105,681 110,472 114,006 117,036 119,318 120,628 120,628\\nNon-Operating Liabilities (Mil) 18,276 12,560 7,260 7,260 7,260 7,260 7,260 7,260\\nTotal Liabilities (Mil) 346,',\n", " \"260 7,260 7,260\\nTotal Liabilities (Mil) 346,521 334,212 296,396 296,407 302,261 303,582 304,517 308,053\\nEquity \\nShareholders' Equity (Mil) 161,673 75,943 97,500 108,149 119,074 130,640 142,299 155,004\\nMinority Interest (Mil) 17,567 17,523 8,957 8,957 8,957 8,957 8,957 8,957\\nTotal Equity (Mil) 179,240 93,466 106,457 117,106 128,031 139,597 151,256 163,961\",\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 14 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;\\n4 Jan 2023 06:00, UTC\\nManagement & Ownership\\nManagement Activity as of 31 Mar 2023\\nName Position Share Held Report Date* Insider Activity\\nJohn T. Stankey Director, President and Chief Executive Officer 233,',\n", " 'Stankey Director, President and Chief Executive Officer 233,176 31 Mar 2023 679,490\\nPascal Desroches Senior Executive Vice President and Chief Financial Officer 339,069 31 Mar 2023 342,470\\nLori M. Lee Chief Executive Officer, AT&T Latin America and Global Marketing Officer 93,540 31 Mar 2023 251,004\\nDavid S. Huntley Senior Executive Vice President and Chief Compliance Officer 139,936 31 Mar 2023 145,915\\nDavid R. McAtee Senior Executive Vice President and General Counsel 408,510 31 Mar 2023 579,775\\nJeffery S. McElfresh Chief Executive Officer of AT&T Communications LLC 198,931 31 Mar 2023 393,507\\nAngela R. Santone Senior Executive Vice President, Human Resources 104,603 31 Mar 2023 172,883\\nEdward W. GillespieSenior Executive Vice President, External and Legislative Affairs, AT&T \\nServices, Inc.48,065 31 Mar 2023 116,625\\nDebra L. Dial Senior Vice President, Chief Accounting Officer and Controller 105,',\n", " '625\\nDebra L. Dial Senior Vice President, Chief Accounting Officer and Controller 105,951 31 Mar 2023 53,506\\nJason Kilar Chief Executive Officer of Warner Media, LLC 1,241,405 31 Mar 2022 1,025,225\\nFund Ownership as of 31 Dec 2022\\nTop Owners % of Shares Held % of Fund Assets Change (k) Portfolio Date\\nVanguard US Total Market Shares ETF 3.04 0.37 2,002,867 31 Dec 2022\\nVanguard Total Stock Market Index Fund 3.04 0.35 2,002,867 31 Dec 2022\\nVanguard Instl Ttl Stck Mkt Idx Tr 2.99 0.31 1,719,832 30 Sep 2022\\nVanguard 500 Index Fund 2.31 0.41 1,462,980 31 Dec 2022\\nSPDR® S&P 500 ETF Trust 1.10 0.41 -453,787 31 Dec 2022\\nConcentrated Holders\\nFidelity® Select Telecommunications Port 0.03 20.',\n", " '03 20.78 0 30 Nov 2022\\nFidelity® Telecom and Utilities Fund 0.07 10.28 0 30 Nov 2022\\nStratégie Télécom 0.00 8.70 143 31 Dec 2022\\nHIP Sustainable Global Dividends ESG 0.00 8.62 0 31 Dec 2022\\nRydex Telecommunications Fund 0.00 8.21 -294 30 Nov 2022\\nInstitutional Transactions as of 31 Dec 2022\\nTop 5 Buyers % of Shares Held % of Fund Assets Shrs Bought/Sold (k) Portfolio Date\\nMarshall Wace Asset Management Ltd 0.19 0.44 12,937,174 30 Sep 2022\\nRenaissance Technologies Corp 0.14 0.22 8,373,086 30 Sep 2022\\nRobeco Institutional Asset Management BV 0.19 0.68 4,823,559 30 Sep 2022\\nPrudential Financial Inc 0.18 0.33 4,748,',\n", " \"18 0.33 4,748,238 30 Sep 2022\\nPrudential Investment Management Inc 0.18 0.33 4,748,238 30 Sep 2022\\nTop 5 Sellers\\nCapital World Investors 0.29 0.07 -39,206,166 30 Sep 2022\\nFranklin Resources Inc 0.06 0.03 -17,500,254 30 Sep 2022\\nJacobs Levy Equity Management, Inc. 0.00 — -7,521,561 30 Sep 2022\\nBlackRock Inc 6.95 0.26 -7,159,545 30 Sep 2022\\nJANE STREET GROUP, LLC 0.02 0.01 -5,431,003 30 Sep 2022\\n*Represents the date on which the owner's name, position, and common shares held were reported by the holder or issuer.\",\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 15 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nComparable Company Analysis These companies are chosen by the analyst and the data are shown by nearest calendar year in descending market capitalization order.',\n", " 'Valuation Analysis as of 25 Jan 2023 Price/Earnings EV/EBITDA Price/Free Cash Flow Price/Book Price/Sales \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 15.6 12.0 11.0 9.1 7.0 6.8 14.2 9.8 9.9 2.4 1.9 1.8 2.0 1.4 1.5\\nVerizon Communications Inc VZ 7.6 9.1 9.4 8.1 7.3 7.2 15.5 10.0 9.4 — — 1.6 1.6 1.2 1.2\\nT-Mobile US Inc TMUS 48.1 59.7 19.9 9.',\n", " '1 59.7 19.9 9.2 10.8 9.4 90.9 51.5 17.8 2.1 2.7 2.4 1.8 2.3 2.2\\nAverage 23.8 26.9 13.4 8.8 8.4 7.8 40.2 23.8 12.4 2.2 2.3 1.9 1.8 1.6 1.6\\nAT&T Inc T 7.6 7.1 6.9 26.5 6.9 6.6 — 9.3 8.2 — — 1.2 1.5 1.2 1.',\n", " '2 — — 1.2 1.5 1.2 1.2\\nReturns Analysis as of 25 Jan 2023 ROIC % Adjusted ROIC % Return on Equity % Return on Assets % Dividend Yield % \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 25.4 24.9 26.2 10.2 9.9 10.3 15.2 14.9 15.3 5.1 5.2 5.5 2.0 2.7 3.0\\nVerizon Communications Inc VZ — 9.1 8.9 6.4 — 8.1 24.6 19.6 17.7 5.7 4.8 4.6 6.5 6.5 6.',\n", " '7 4.8 4.6 6.5 6.5 6.7\\nT-Mobile US Inc TMUS 6.6 7.3 10.2 6.1 6.7 9.4 4.5 3.5 12.9 1.5 1.2 4.6 — — —\\nAverage 16.0 13.8 15.1 7.6 8.3 9.3 14.8 12.7 15.3 4.1 3.7 4.9 4.2 4.6 4.8\\nAT&T Inc T -1.6 8.1 8.1 -1.2 6.3 6.4 -10.7 19.1 17.4 -2.1 4.6 4.5 7.3 5.4 5.',\n", " '1 4.6 4.5 7.3 5.4 5.4\\nGrowth Analysis as of 25 Jan 2023 Revenue Growth % EBIT Growth % EPS Growth % FCF Growth % DPS Growth % \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 12.4 3.4 -1.5 19.0 11.4 5.9 23.9 3.8 8.2 24.1 26.6 -1.4 11.1 8.0 10.0\\nVerizon Communications Inc VZ 2.4 -0.5 1.2 -4.4 -2.8 -1.5 -5.9 -14.5 -2.9 -123.5 165.7 7.2 2.0 2.',\n", " '9 -123.5 165.7 7.2 2.0 2.3 2.3\\nT-Mobile US Inc TMUS 17.1 0.5 4.7 -2.3 9.4 115.2 -9.2 2.9 200.7 19.5 -155.7 666.8 — — —\\nAverage 10.6 1.1 1.5 4.1 6.0 39.9 2.9 -2.6 68.7 -26.6 12.2 224.2 4.4 3.4 4.1\\nAT&T Inc T 2.1 1.0 2.2 3.6 10.8 4.7 -19.8 18.8 2.8 -100.6 -42154.1 18.4 -35.1 -17.8 0.',\n", " '1 18.4 -35.1 -17.8 0.0\\nProfitability Analysis as of 25 Jan 2023 Gross Margin % EBITDA Margin % Operating Margin % Net Margin % FCF Margin % \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 29.8 31.1 32.1 29.8 31.1 32.1 17.9 19.3 20.7 12.9 12.7 13.5 13.8 14.7 14.8\\nVerizon Communications Inc VZ 56.8 56.4 56.4 35.0 34.8 34.8 22.5 22.0 21.4 15.9 13.7 13.1 10.3 12.4 13.',\n", " '9 13.7 13.1 10.3 12.4 13.1\\nT-Mobile US Inc TMUS 54.3 53.1 57.1 33.2 33.2 36.3 8.6 9.4 19.3 — 4.0 11.5 2.0 4.4 12.3\\nAverage 47.0 46.9 48.5 32.7 33.0 34.4 16.3 16.9 20.5 9.6 10.1 12.7 8.7 10.5 13.4\\nAT&T Inc T 33.9 35.2 35.8 11.1 35.2 35.8 19.0 20.8 21.3 15.2 16.9 17.1 13.4 — 14.2\\nLeverage Analysis as of 25 Jan 2023 Debt/Equity % Debt/Total Cap % EBITDA/Net Int.',\n", " 'Exp Total Debt/EBITDA Asset/Equity \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 104.1 99.8 93.1 51.0 49.9 48.2 8.1 8.3 8.5 2.9 2.6 2.5 2.9 2.8 2.7\\nVerizon Communications Inc VZ 165.3 157.8 144.8 62.3 — 59.1 13.2 9.5 9.1 3.1 3.3 3.2 4.2 4.0 3.8\\nT-Mobile US Inc TMUS 111.1 104.8 91.5 52.6 51.2 47.8 7.9 7.',\n", " '5 52.6 51.2 47.8 7.9 7.9 9.4 2.9 2.8 2.4 3.0 2.9 2.7\\nAverage 126.8 120.8 109.8 55.3 50.5 51.7 9.7 8.6 9.0 3.0 2.9 2.7 3.4 3.2 3.1\\nAT&T Inc T 139.5 123.9 115.4 58.3 — 53.6 2.2 7.2 7.4 10.1 3.1 3.1 4.1 3.8 3.',\n", " '1 3.1 3.1 4.1 3.8 3.6\\nLiquidity Analysis as of 25 Jan 2023 Cash per Share Current Ratio Quick Ratio Cash/Short-Term Debt Payout Ratio % \\nCompany/Ticker 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E) 2022 2023(E) 2024(E)\\nComcast Corp Class A CMCSA 1.9 2.3 2.2 0.8 0.9 0.8 0.8 0.9 0.8 4.1 2.4 2.5 32.9 34.0 34.5\\nVerizon Communications Inc VZ — 2.6 2.9 0.8 — 1.1 0.7 1.0 1.0 0.3 — 1.9 50.9 59.5 62.',\n", " '3 — 1.9 50.9 59.5 62.7\\nT-Mobile US Inc TMUS 5.3 3.0 7.6 0.9 1.0 1.4 0.8 0.8 1.2 1.0 1.9 5.0 0.0 0.0 0.0\\nAverage 1.8 2.1 3.5 0.8 0.7 1.0 0.7 0.8 0.9 1.5 1.1 2.7 -8.4 34.1 34.9\\nAT&T Inc T — 0.4 1.3 0.7 0.7 0.8 0.6 0.6 0.7 0.5 — 1.2 -117.4 42.9 42.3',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 16 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nCompetitors Price vs.',\n", " 'Fair Value\\nComcast Corp Class A CMCSA\\n050100150200Fair Value: 60.00\\n29 Jul 2021 17:13, UTC\\nLast Close: 40.10\\nOver Valued\\nUnder Valued\\n2018 2019 2020 2021 2022 YTD\\n0.81 1.00 1.05 0.84 0.58 0.67 Price/Fair Value\\n-12.69 33.92 18.52 -2.08 -28.41 15.44 Total Return %\\nMorningstar Rating\\nTotal Return % as of 25 Jan 2023. Last Close as of 25 Jan 2023. Fair Value as of 29 Jul 2021 17:13, UTC.',\n", " 'Fair Value as of 29 Jul 2021 17:13, UTC.\\nVerizon Communications Inc VZ\\n050100150200Fair Value: 57.00\\n24 Jan 2023 21:06, UTC\\nLast Close: 40.33\\nOver Valued\\nUnder Valued\\n2018 2019 2020 2021 2022 YTD\\n0.97 1.06 1.03 0.90 0.67 0.71 Price/Fair Value\\n10.70 13.52 -0.29 -7.26 -19.22 4.02 Total Return %\\nMorningstar Rating\\nTotal Return % as of 25 Jan 2023. Last Close as of 25 Jan 2023. Fair Value as of 24 Jan 2023 21:06, UTC.',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 17 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nCompetitors Price vs.',\n", " 'Fair Value (Continued)\\nT-Mobile US Inc TMUS\\n050100150200Fair Value: 165.00\\n28 Oct 2022 19:59, UTC\\nLast Close: 148.07\\nOver Valued\\nUnder Valued\\n2018 2019 2020 2021 2022 YTD\\n0.84 0.97 1.25 0.86 0.85 0.90 Price/Fair Value\\n0.16 23.28 71.96 -13.99 20.71 5.76 Total Return %\\nMorningstar Rating\\nTotal Return % as of 25 Jan 2023. Last Close as of 25 Jan 2023. Fair Value as of 28 Oct 2022 19:59, UTC.',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 18 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nRecent Analyst Notes\\nThe U.S. Wireless Carriers Are Poised to Gush Cash; Verizon Shares Particularly Attractive Michael \\nHodel,Director,16 Nov 2022\\nSentiment around the U.S.',\n", " \"wireless industry, especially Verizon, has turned negative recently. We suspect \\nindustry bears hold two key contentions: First, the carriers will perpetually spend egregiously on their networks, \\nprimarily buying wireless spectrum whenever the government makes more available. Second, in an extremely \\nmature market, these firms will beat each other up seeking whatever growth remains, punishing revenue and \\nmargins. As such, balance sheets will continually need repair and cash available for shareholders will be \\nincreasingly limited.We believe this outlook is wrong. Following a series of spectrum auctions, AT&T and Verizon \\nhave acquired a trove of spectrum that should allow both firms to close the network speed and capacity gap that \\nT-Mobile has opened recently. Even with the huge increase in capital invested following these auctions, returns \\non capital remain acceptable for each of the wireless carriers, in our view. Going forward, we expect driving \\nreturns comfortably above the cost of capital will be the carriers' highest priority.Market share shifts gradually \\nthanks to phone installment plans and general customer inertia. As a result, we believe the carriers will have \\nincreasingly little to gain from huge new network initiatives or increased promotional intensity designed to grab \\nmarket share.\",\n", " \"Maximizing the long-term value of the industry as whole, without running afoul of regulators, is the \\nrational choice for each carrier in our view.In our view, this outlook means that market share will gradually move \\ntoward parity. As the current share leader and historically the industry's premium player, we believe Verizon has \\nlittle choice but to accept gradual market share losses. The stock market clearly hates the customer losses the \\nfirm has reported recently. However, we account for share losses in our fair value estimate. While AT&T and T-\\nMobile also trade below our fair value estimates, we believe Verizon shares are particularly attractive. \\nAT&T Posts Another Solid Quarter as Revenue Growth Continues to Accelerate Michael Hodel,Director,20 Oct \\n2022\\nAT&T’s third-quarter results lend support to our view that the firm is poised to deliver steadily improving \\nperformance in the coming years. While wireless customer additions slowed, revenue per customer spiked \\nhigher, exceeding our expectations. The firm expects to meet or exceed financial targets for the year, including \\ngenerating $14 billion of free cash flow.\",\n", " 'While AT&T has clearly backed away from the 2023 free cash flow target \\nof $20 billion set following the Warner spinoff, management expects this metric to grow next year, which we \\nbelieve to be very reasonable and provides comfort around the dividend. We are maintaining our $25 fair value \\nestimate, and we think the stock is significantly undervalued.Adjusted for business dispositions, total revenue \\nincreased 3.1% year over year on solid results across all segments. Wireless service revenue (about half of total \\nfirm sales) increased 5.6%, the best result in a decade. AT&T added 708,000 postpaid phone customers during \\nthe quarter, down from 928,000 a year ago. The firm continues to do a great job of attracting new customers but \\nthe pace of those leaving picked up slightly: monthly postpaid phone churn was 0.84%, up from 0.72% last year.',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 19 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nAT&T has pushed some customers away with select price increases, but churn remains below prepandemic \\nlevels.',\n", " 'Also, average revenue per postpaid phone customer jumped 2.4% versus a year ago, far stronger than \\nexpected entering the year given the accelerating amortization of past promotional credits against \\nrevenue.Wireless profitability remains solid. The segment generated a 41.7% EBITDA margin, down slightly from \\n41.9% a year ago. Management expects margins to begin improving as 3G network shutdown costs dissipate, \\ninvestments to improve efficiency deliver results, and the benefits of increased sales drive operating \\nleverage.Consolidated free cash flow was flat versus a year ago at $3.8 billion despite a step up in capital \\ninvestment to $6.8 billion from $5.5 billion. \\nAT&T Drives Continued Wireless Momentum During Q2; 2022 Free Cash Flow Target Drops to $14 Billion Neil \\nMacker,Senior Equity Analyst,22 Jul 2022\\nAT&T posted solid telecom results for the second quarter, keeping the firm on pace to meet or exceed \\nmanagement’s 2022 subscriber growth expectations.',\n", " 'The continued growth in wireless additions led to an \\nincrease in the mobility services revenue growth target to 4%-5% from “at least 3%.” However, management cut \\nits free cash flow target for 2022 by $2 billion to $14 billion due to continued growth investments and the timing \\nof collections. Our fair value estimate, which reflects the Warner spinoff, remains $25 per share. We continue to \\nlike AT&T’s strategic position and its network investment plans, which we expect will deliver improving revenue \\nand profit growth over the next several years.Adjusted for the Warner spinoff, DirecTV transaction, and Latin \\nAmerican asset sale, total revenue (now roughly two thirds wireless, with most of the remainder enterprise and \\nconsumer fixed-line services) increased 2.2% year over year to $29.6 billion. Wireless service revenue growth \\naccelerated to 4.8% year over year, ahead of management’s previous 2022 target and in line with the new one, \\non strong postpaid phone customer growth in recent quarters.',\n", " 'AT&T added 813,000 postpaid phone customers \\nduring the quarter, up from 798,000 a year ago, the strongest second quarter in a decade. Despite more than two \\nyears of blistering industrywide growth, we still believe that postpaid customer additions will eventually have to \\ntick down and match population growth more closely, but AT&T has yet to see any sign of falling \\ndemand.Average revenue per postpaid phone customer was also strong, growing 1.1% versus a year ago as \\npromotional credits, which are amortized against revenue, declined in the quarter and more customers traded up \\nto higher-priced unlimited plans. Management expects average revenue per postpaid phone customer to improve \\nfurther in the second half. Segment EBITDA expanded by 2.5% year over year, with further expansion projected in \\nthe second half of 2022. \\nAT&T Avoids Distraction, Continues to Gain Wireless Momentum During Q1 Michael Hodel,Director,21 Apr \\n2022\\nAT&T delivered generally solid telecom results for its first quarter, putting it on pace to at least meet \\nmanagement’s 2022 growth expectations.',\n", " 'Evaluating profitability and cash flow is more difficult, given heavy \\ninvestment in the outgoing WarnerMedia business, the complexity of the various transactions AT&T has',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 20 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nundertaken recently, 3G wireless network shutdown costs, and typical seasonal pressures.',\n", " 'Management remains \\ncommitted to delivering $16 billion of free cash flow this year and $20 billion in 2023 under the more conservative \\ncalculation it has adopted. Our fair value estimate, recently adjusted to reflect the Warner spinoff, remains $25 \\nper share. We continue to like AT&T’s strategic position and its network investment plans, which we expect will \\ndeliver improving revenue and profit growth over the next several years.Adjusted for the Warner spinoff, DirecTV \\ntransaction, and Latin American asset sale, total revenue (now roughly two thirds wireless, with most of the \\nremainder enterprise and consumer fixed-line services) increased 2.5% year over year. Wireless service revenue \\ngrowth accelerated to 4.8% year over year, well ahead of management’s “at least 3%” 2022 target, on strong \\npostpaid phone customer growth in recent quarters. That strength continued as AT&T added 691,000 postpaid \\nphone customers during the quarter, up from 595,000 a year ago, extending the impressive turnaround in the \\nbusiness.',\n", " 'After two years of torrid industrywide growth, postpaid customer additions will eventually have to \\nmatch population growth more closely, but AT&T hasn’t yet seen any sign of falling demand.Average revenue per \\npostpaid phone customer was also surprisingly strong (though perhaps buoyed by the 3G shutdown), declining \\nonly 0.2% versus a year ago despite heavy promotional credits, which are amortized against revenue. Segment \\nEBITDA declined 1.8% year over year but would have increased about 2% absent 3G network shutdown costs. \\nWarner Bros. Discovery Launches as a Media Powerhouse; AT&T Now Focused on Telecom Neil \\nMacker,Senior Equity Analyst,11 Apr 2022\\nThe long-awaited merger between Discovery and WarnerMedia is complete. We are maintaining our narrow \\nmoat rating for the successor firm and lowering our fair value estimate to $40 from $42 as we have updated our \\nmodel to fully incorporate the pro forma results and to forecast the combined firm. For AT&T, we also maintain \\nour narrow moat rating on the standalone telecom firm, with a $25 fair value estimate.Warner Bros.',\n", " 'Discovery is \\nnow one of the largest media firms in the world with tremendous scale and reach. The merger has created a firm \\nwith tremendous content production and distribution capabilities along with a very deep and wide content \\nlibrary. The new company owns a number of well-known networks including HBO, Discovery, CNN, and TLC as \\nwell as a slew of major entertainment franchises like Superman, Rick and Morty, and Game of Thrones. We \\nproject that the new company, led by Discovery CEO David Zaslav, will use its combined programming library and \\nproduction capabilities to drive further growth in its streaming services as it navigates the transition toward a \\nmore direct-to-consumer focused model, centered on combined HBO Max/Discovery+ services.As for AT&T, we \\nbelieve the firm is in a much stronger place, with renewed management focus and a stronger financial position. \\nWe remain optimistic about the wireless business and expect that AT&T and its rivals will compete rationally, \\nallowing for steady, albeit slow, growth and solid cash flow. We also like the firm’s investment plans, which call \\nfor aggressive investment in wireless network capacity and the fiber network over the next several years.',\n", " 'We \\nexpect AT&T will emerge from this period of investment in a unique place within the telecom industry, with the \\nability to use its combined wireless and fixed-line capabilities to grab market share across a large and growing \\nportion of the U.S.',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 21 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869.',\n", " 'To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®AT&T Inc T QQQQ 25 Jan 2023 22:28, UTC\\nLast Price Fair Value Estimate Price/FVE Market Cap Economic Moat TMMoat Trend TM Uncertainty Capital Allocation ESG Risk Rating Assessment 1\\n20.42 USD\\n25 Jan 202325.00 USD\\n11 Apr 2022 03:30, UTC0.82136.57 USD Bil\\n25 Jan 2023\\nNarrow Stable Medium Poor ;;;;;\\n4 Jan 2023 06:00, UTC\\nAT&T Follows Verizon, Pledging Modest Growth and Lower Network Investment in 2024 and Beyond Michael \\nHodel,Director,13 Mar 2022\\nAT&T provided additional financial details at its 2022 analyst day, but the firm’s strategic path was largely \\nunchanged. AT&T has two major priorities focused on a common objective: deploying the mid-band spectrum \\nacquired recently and expanding its fiber network aggressively to provide high-quality telecom services.',\n", " 'Management reiterated its $20 billion 2023 free cash flow target, clarifying that this figure includes payments for \\nvendor financing. We are leaving our fair value estimate at $35 and believe the stock is attractive.AT&T continues \\nto target 30 million customer locations passed with fiber by the end of 2025, roughly doubling its current footprint \\nto reach half of its fixed-line territory. The firm also spoke at length for the first time about retiring its copper \\nnetworks—it believes current demand is so low across 25% of its fixed-line territory (about 15 million locations) \\nthat regulators will allow it to shift exclusively to wireless technologies in those locations by the end of 2025. If \\nsuccessful, this shift would substantially improve the firm’s cost structure.AT&T also expects to cover 200 million \\npeople with deep mid-band spectrum holdings by the end of 2023, likely putting it behind Verizon (targeting 175 \\nmillion by the end of this year) and T-Mobile (210 million at the end of 2021).',\n", " 'We don’t believe this gap is a \\nconcern as AT&T is likely targeting areas with the strongest need, and it should reach coverage parity quickly \\nbeyond 2023. We expect AT&T will have a strong network position over the medium term as it combines fiber and \\nwireless coverage.The $24 billion network budget for 2022 was maintained, but, as with Verizon last week, AT&T \\nmade clear that spending will ramp down once spending to deploy mid-band spectrum slows in 2024. We believe \\nAT&T’s financial targets, including its investment plans, make the same assumption as Verizon’s--that the \\nwireless competitive environment remains the same or improves in the coming years.',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 22 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®Research Methodology for Valuing Companies\\nMorningstar Equity Research Star Rating Methodology\\nOverview\\nAt the heart of our valuation system is a detailed projec-\\ntion of a company’s future cash flows, resulting from our \\nanalysts’ research. Analysts create custom industry and \\ncompany assumptions to feed income statement, balance \\nsheet, and capital investment assumptions into our glob-\\nally standardized, proprietary discounted cash flow, or \\nDCF, modeling templates. We use scenario analysis, inde-\\npth competitive advantage analysis, and a variety of other \\nanalytical tools to augment this process.',\n", " 'Moreover, we \\nthink analyzing valuation through discounted cash flows \\npresents a better lens for viewing cyclical companies, \\nhigh-growth firms, businesses with finite lives (e.g., \\nmines), or companies expected to generate negative \\nearnings over the next few years. That said, we don’t dis-\\nmiss multiples altogether but rather use them as support-\\ning cross-checks for our DCF-based fair value estimates. \\nWe also acknowledge that DCF models offer their own \\nchallenges (including a potential proliferation of estim-\\nated inputs and the possibility that the method may miss \\nshortterm market-price movements), but we believe these \\nnegatives are mitigated by deep analysis and our \\nlongterm approach.\\nMorningstar’s equity research group (”we,” “our”) be-\\nlieves that a company’s intrinsic worth results from the \\nfuture cash flows it can generate.',\n", " 'The Morningstar Rating \\nfor stocks identifies stocks trading at a discount or premi-\\num to their intrinsic worth—or fair value estimate, in \\nMorningstar terminology. Five-star stocks sell for the \\nbiggest risk adjusted discount to their fair values, where-\\nas 1-star stocks trade at premiums to their intrinsic worth.\\nFour key components drive the Morningstar rating: (1) our \\nassessment of the firm’s economic moat, (2) our estimate \\nof the stock’s fair value, (3) our uncertainty around that \\nfair value estimate and (4) the current market price. This \\nprocess ultimately culminates in our singlepoint star rat-\\ning.\\n1. Economic Moat\\nThe concept of an economic moat plays a vital role not \\nonly in our qualitative assessment of a firm’s long-term \\ninvestment potential, but also in the actual calculation of \\nour fair value estimates.',\n", " 'An economic moat is a structural \\nfeature that allows a firm to sustain excess profits over a long period of time. We define economic profits as re-\\nturns on invested capital (or ROIC) over and above our es-\\ntimate of a firm’s cost of capital, or weighted average \\ncost of capital (or WACC). Without a moat, profits are \\nmore susceptible to competition. We have identified five \\nsources of economic moats: intangible assets, switching \\ncosts, network effect, cost advantage, and efficient scale.\\nCompanies with a narrow moat are those we believe are \\nmore likely than not to achieve normalized excess returns \\nfor at least the next 10 years. Wide-moat companies are \\nthose in which we have very high confidence that excess \\nreturns will remain for 10 years, with excess returns more \\nlikely than not to remain for at least 20 years.',\n", " \"The longer \\na firm generates economic profits, the higher its intrinsic \\nvalue. We believe low-quality, no-moat companies will \\nsee their normalized returns gravitate toward the firm’s \\ncost of capital more quickly than companies with moats.\\nWhen considering a company's moat, we also assess \\nwhether there is a substantial threat of value destruction, \\nstemming from risks related to ESG, industry disruption, \\nfinancial health, or other idiosyncratic issues. In this con-\\ntext, a risk is considered potentially value destructive if its \\noccurrence would eliminate a firm’s economic profit on a \\ncumulative or midcycle basis. If we deem the probability \\nof occurrence sufficiently high, we would not characterize \\nthe company as possessing an economic moat.\\nTo assess the sustainability of excess profits, analysts \\nperform ongoing assessments of the moat trend.\",\n", " 'A firm’s \\nmoat trend is positive in cases where we think its sources \\nof competitive advantage are growing stronger; stable \\nwhere we don’t anticipate changes to competitive ad-\\nvantages over the next several years; or negative when \\nwe see signs of deterioration.\\n2. Estimated Fair Value\\nCombining our analysts’ financial forecasts with the \\nfirm’s economic moat helps us assess how long returns \\non invested capital are likely to exceed the firm’s cost of \\ncapital.',\n", " 'Returns of firms with a wide economic moat rat-\\ning are assumed to fade to the perpetuity period over a \\nlonger period of time than the returns of narrow-moat \\nfirms, and both will fade slower than no-moat firms, in-\\ncreasing our estimate of their intrinsic value.Our model is divided into three distinct stages:\\nStage I: Explicit Forecast\\nIn this stage, which can last five to 10 years, analysts \\nmake full financial statement forecasts, including items \\nsuch as revenue, profit margins, tax rates, changes in \\nworkingcapital accounts, and capital spending. Based on \\nthese projections, we calculate earnings before interest, \\nafter taxes (EBI) and the net new investment (NNI) to de-\\nrive our annual free cash flow forecast.',\n", " 'Stage II: Fade\\nThe second stage of our model is the period it will take \\nthe company’s return on new invested capital—the re-\\nturn on capital of the next dollar invested (“RONIC”)—to \\ndecline (or rise) to its cost of capital. During the Stage II \\nperiod, we use a formula to approximate cash flows in \\nlieu of explicitly modeling the income statement, balance \\nsheet, and cash flow statement as we do in Stage I. The \\nlength of the second stage depends on the strength of \\nthe company’s economic moat. We forecast this period to \\nlast anywhere from one year (for companies with no eco-\\nnomic moat) to 10–15 years or more (for wide-moat com-\\npanies).',\n", " 'During this period, cash flows are forecast using \\nfour assumptions: an average growth rate for EBI over the \\nperiod, a normalized investment rate, average return on \\nnew invested capital (RONIC), and the number of years \\nuntil perpetuity, when excess returns cease. The invest-\\nment rate and return on new invested capital decline un-\\ntil a perpetuity value is calculated. In the case of firms \\nthat do not earn their cost of capital, we assume marginal \\nROICs rise to the firm’s cost of capital (usually attribut-\\nable to less reinvestment), and we may truncate the \\nsecond stage.\\nStage III: Perpetuity\\nOnce a company’s marginal ROIC hits its cost of capital, \\nwe calculate a continuing value, using a standard per-\\npetuity formula.',\n", " 'At perpetuity, we assume that any \\ngrowth or decline or investment in the business neither \\ncreates nor destroys value and that any new investment \\nprovides a return in line with estimated WACC.\\nBecause a dollar earned today is worth more than a dollar \\nearned tomorrow, we discount our projections of cash \\nflows in stages I, II, and III to arrive at a total present \\nvalue of expected future cash flows. Because we are \\nmodeling free cash flow to the firm—representing cash \\navailable to provide a return to all capital providers—we \\ndiscount future cash flows using the WACC, which is a \\nweighted average of the costs of equity, debt, and pre-\\nferred stock (and any other funding sources), using ex-\\npected future proportionate long-term, market-value \\nweights.\\n3. Uncertainty Around That Fair Value Estimate',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 23 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®Research Methodology for Valuing Companies\\nMorningstar Equity Research Star Rating Methodology\\n Morningstar’s Uncertainty Rating is designed to capture \\nthe range of potential outcomes for a company’s intrinsic \\nvalue. This rating is used to assign the margin of safety \\nrequired before investing, which in turn explicitly drives \\nour stock star rating system. The Uncertainty Rating is \\naimed at identifying the confidence we should have in as-\\nsigning a fair value estimate for a given stock.',\n", " 'Our Uncertainty Rating is meant to take into account any-\\nthing that can increase the potential dispersion of future \\noutcomes for the intrinsic value of a company, and any-\\nthing that can affect our ability to accurately predict \\nthese outcomes. The rating begins with a suggested rat-\\ning produced by a quantitative process based on the trail-\\ning 12-month standard deviation of daily stock returns. \\nAn analyst overlay is then applied, with analysts using \\nthe suggested rating, historical rating data, and their own \\nknowledge of the company to inform them as they make \\nthe final Uncertainty Rating decision. Ultimately, the rat-\\ning decision rests with the analyst.',\n", " 'Ultimately, the rat-\\ning decision rests with the analyst. Analysts take into ac-\\ncount many characteristics when making their final de-\\ncision, including cyclical factors, operational and financial \\nfactors such as leverage, company-specific events, ESG \\nrisks, and anything else that might increase the potential \\ndispersion of future outcomes and our ability to estimate \\nthose outcomes. \\nOur recommended margin of safety—the discount to fair \\nvalue demanded before we’d recommend buying or \\nselling the stock—widens as our uncertainty of the es-\\ntimated value of the equity increases. The more uncertain \\nwe are about the potential dispersion of outcomes, the \\ngreater the discount we require relative to our estimate of \\nthe value of the firm before we would recommend the \\npurchase of the shares. In addition, the Uncertainty Rat-\\ning provides guidance in portfolio construction based on \\nrisk tolerance.',\n", " 'Our Uncertainty Ratings are: Low, Medium, High, Very \\nHigh, and Extreme.\\nMargin of Safety\\nQualitative Analysis \\nUncertainty Ratings QQQQQ Rating QRating\\nLow 20% Discount 25% Premium\\nMedium 30% Discount 35% Premium\\nHigh 40% Discount 55% Premium\\nVery High 50% Discount 75% Premium\\nExtreme 75% Discount 300% Premium\\nOur uncertainty rating is based on the interquartile range, \\nor the middle 50% of potential outcomes, covering the \\n25th percentile–75th percentile. This means that when a \\nstock hits 5 stars, we expect there is a 75% chance that \\nthe intrinsic value of that stock lies above the current \\nmarket price. Similarly, when a stock hits 1 star, we ex-pect there is a 75% chance that the intrinsic value of that \\nstock lies below the current market price.\\n4.',\n", " '4. Market Price\\nThe market prices used in this analysis and noted in the \\nreport come from exchange on which the stock is listed \\nwhich we believe is a reliable source.\\nFor more details about our methodology, please go to \\nhttps://shareholders.morningstar.com\\nMorningstar Star Rating for Stocks\\nOnce we determine the fair value estimate of a stock, we \\ncompare it with the stock’s current market price on a \\ndaily basis, and the star rating is automatically re-calcu-\\nlated at the market close on every day the market on \\nwhich the stock is listed is open. Our analysts keep close \\ntabs on the companies they follow, and, based on thor-\\nough and ongoing analysis, raise or lower their fair value \\nestimates as warranted.\\nPlease note, there is no predefined distribution of stars.',\n", " 'Please note, there is no predefined distribution of stars. \\nThat is, the percentage of stocks that earn 5 stars can \\nfluctuate daily, so the star ratings, in the aggregate, can \\nserve as a gauge of the broader market’s valuation. \\nWhen there are many 5-star stocks, the stock market as a \\nwhole is more undervalued, in our opinion, than when \\nvery few companies garner our highest rating.\\nWe expect that if our base-case assumptions are true the \\nmarket price will converge on our fair value estimate over time generally within three years (although it is im-\\npossible to predict the exact time frame in which market \\nprices may adjust).\\nOur star ratings are guideposts to a broad audience and \\nindividuals must consider their own specific investment \\ngoals, risk tolerance, tax situation, time horizon, income \\nneeds, and complete investment portfolio, among other \\nfactors.',\n", " 'The Morningstar Star Ratings for stocks are defined be-\\nlow:\\nQQQQQ We believe appreciation beyond a fair risk ad-\\njusted return is highly likely over a multiyear time frame. \\nScenario analysis developed by our analysts indicates \\nthat the current market price represents an excessively \\npessimistic outlook, limiting downside risk and maximiz-\\ning upside potential.\\nQQQQ We believe appreciation beyond a fair risk-ad-\\njusted return is likely.\\nQQQ Indicates our belief that investors are likely to re-\\nceive a fair risk-adjusted return (approximately cost of \\nequity).\\nQQ We believe investors are likely to receive a less than \\nfair risk-adjusted return.\\nQ Indicates a high probability of undesirable risk-adjus-\\nted returns from the current market price over a multiyear',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 24 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®Research Methodology for Valuing Companies\\ntime frame, based on our analysis. Scenario analysis by \\nour analysts indicates that the market is pricing in an ex-\\ncessively optimistic outlook, limiting upside potential and \\nleaving the investor exposed to Capital loss.\\nOther Definitions\\nLast Price: Price of the stock as of the close of the mar-\\nket of the last trading day before date of the report.',\n", " 'Capital Allocation Rating: Our Capital Allocation (or \\nStewardship) Rating represents our assessment of the \\nquality of management’s capital allocation, with particu-\\nlar emphasis on the firm’s balance sheet, investments, \\nand shareholder distributions. Analysts consider compan-\\nies’ investment strategy and valuation, balance sheet \\nmanagement, and dividend and share buyback policies. \\nCorporate governance factors are only considered if they \\nare likely to materially impact shareholder value, though \\neither the balance sheet, investment, or shareholder dis-\\ntributions. Analysts assign one of three ratings: \"Exem-\\nplary\", \"Standard\", or \"Poor\". Analysts judge Capital Alloc-\\nation from an equity holder’s perspective. Ratings are de-\\ntermined on a forward looking and absolute basis.',\n", " 'The \\nStandard rating is most common as most managers will \\nexhibit neither exceptionally strong nor poor capital alloc-\\nation.\\nCapital Allocation (or Stewardship) analysis published pri-\\nor to Dec. 9, 2020, was determined using a different pro-\\ncess. Beyond investment strategy, financial leverage, and \\ndividend and share buyback policies, analysts also con-\\nsidered execution, compensation, related party transac-\\ntions, and accounting practices in the rating.\\nCapital Allocation Rating: Our Capital Allocation (or \\nStewardship) Rating represents our assessment of the \\nquality of management’s capital allocation, with particu-\\nlar emphasis on the firm’s balance sheet, investments, \\nand shareholder distributions. Analysts consider compan-\\nies’ investment strategy and valuation, balance sheet \\nmanagement, and dividend and share buyback policies.',\n", " 'Corporate governance factors are only considered if they \\nare likely to materially impact shareholder value, though \\neither the balance sheet, investment, or shareholder dis-\\ntributions. Analysts assign one of three ratings: \"Exem-\\nplary\", \"Standard\", or \"Poor\". Analysts judge Capital Alloc-\\nation from an equity holder’s perspective. Ratings are de-\\ntermined on a forward looking and absolute basis. The \\nStandard rating is most common as most managers will \\nexhibit neither exceptionally strong nor poor capital alloc-\\nation.\\nCapital Allocation (or Stewardship) analysis published pri-\\nor to Dec. 9, 2020, was determined using a different pro-\\ncess. Beyond investment strategy, financial leverage, and \\ndividend and share buyback policies, analysts also con-sidered execution, compensation, related party transac-\\ntions, and accounting practices in the rating.',\n", " 'Sustainalytics ESG Risk Rating Assessment: The ESG \\nRisk Rating Assessment is provided by Sustainalytics; a \\nMorningstar company.\\nSustainalytics’ ESG Risk Ratings measure the degree to \\nwhich company’s economic value at risk is driven by en-\\nvironment, social and governance (ESG) factors.\\nSustainalytics analyzes over 1,300 data points to assess a \\ncompany’s exposure to and management of ESG risks. In \\nother words, ESG Risk Ratings measures a company’s un-\\nmanaged ESG Risks represented as a quantitative score. \\nUnmanaged Risk is measured on an open-ended scale \\nstarting at zero (no risk) with lower scores representing \\nless unmanaged risk and, for 95% of cases, the unman-\\naged ESG Risk score is below 50.\\nBased on their quantitative scores, companies are \\ngrouped into one of five Risk Categories (negligible, low, \\nmedium, high, severe).',\n", " 'These risk categories are absolute, \\nmeaning that a ‘high risk’ assessment reflects a compar-\\nable degree of unmanaged ESG risk across all subindus-\\ntries covered.\\nThe ESG Risk Rating Assessment is a visual representa-\\ntion of Sustainalytics ESG Risk Categories on a 1 to 5 \\nscale. Companies with Negligible Risk = 5 Globes, Low \\nRisk = 4, Medium Risk = 3 Globes, High Risk = 2 Globes, \\nSevere Risk = 1 Globe. For more information, please visit \\nsustainalytics.com/esg-ratings/\\nRatings should not be used as the sole basis in evaluating \\na company or security. Ratings involve unknown risks and \\nuncertainties which may cause our expectations not to \\noccur or to differ significantly from what was expected \\nand should not be considered an offer or solicitation to \\nbuy or sell a security.',\n", " 'Risk Warning\\nPlease note that investments in securities are subject to \\nmarket and other risks and there is no assurance or guar-\\nantee that the intended investment objectives will be \\nachieved. Past performance of a security may or may not \\nbe sustained in future and is no indication of future per-\\nformance. A security investment return and an investor’s \\nprincipal value will fluctuate so that, when redeemed, an \\ninvestor’s shares may be worth more or less than their \\noriginal cost. A security’s current investment performance \\nmay be lower or higher than the investment performance \\nnoted within the report.',\n", " 'Morningstar’s Uncertainty Rating \\nserves as a useful data point with respect to sensitivity \\nanalysis of the assumptions used in our determining a fair \\nvalue price.General Disclosure\\nUnless otherwise provided in a separate agreement, re-\\ncipients accessing this report may only use it in the coun-\\ntry in which the Morningstar distributor is based. Unless \\nstated otherwise, the original distributor of the report is \\nMorningstar Research Services LLC, a U.S.A. domiciled \\nfinancial institution.\\nThis report is for informational purposes only and has no \\nregard to the specific investment objectives, financial \\nsituation or particular needs of any specific recipient. This \\npublication is intended to provide information to assist in-\\nstitutional investors in making their own investment de-\\ncisions, not to provide investment advice to any specific \\ninvestor.',\n", " 'Therefore, investments discussed and recom-\\nmendations made herein may not be suitable for all in-\\nvestors: recipients must exercise their own independent \\njudgment as to the suitability of such investments and re-\\ncommendations in the light of their own investment ob-\\njectives, experience, taxation status and financial posi-\\ntion.\\nThe information, data, analyses and opinions presented \\nherein are not warranted to be accurate, correct, com-\\nplete or timely. Unless otherwise provided in a separate \\nagreement, neither Morningstar, Inc. or the Equity Re-\\nsearch Group represents that the report contents meet all \\nof the presentation and/or disclosure standards applic-\\nable in the jurisdiction the recipient is located.\\nExcept as otherwise required by law or provided for in a \\nseparate agreement, the analyst, Morningstar, Inc.',\n", " 'and \\nthe Equity Research Group and their officers, directors \\nand employees shall not be responsible or liable for any \\ntrading decisions, damages or other losses resulting from, \\nor related to, the information, data, analyses or opinions \\nwithin the report. The Equity Research Group encourages \\nrecipients recipients of this report to read all relevant is-\\nsue documents (e.g., prospectus) pertaining to the secur-\\nity concerned, including without limitation, information \\nrelevant to its investment objectives, risks, and costs be-\\nfore making an in vestment decision and when deemed \\nnecessary, to seek the advice of a legal, tax, and/or ac-\\ncounting professional.',\n", " 'The Report and its contents are not directed to, or inten-\\nded for distribution to or use by, any person or entity who \\nis a citizen or resident of or located in any locality, state, \\ncountry or other jurisdiction where such distribution, pub-\\nlication, availability or use would be contrary to law or \\nregulation or which would subject Morningstar, Inc. or its \\naffiliates to any registration or licensing requirements in \\nsuch jurisdiction.',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 25 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®Research Methodology for Valuing Companies\\nWhere this report is made available in a language other \\nthan English and in the case of inconsistencies between \\nthe English and translated versions of the report, the Eng-\\nlish version will control and supersede any ambiguities \\nassociated with any part or section of a report that has \\nbeen issued in a foreign language. Neither the analyst, \\nMorningstar, Inc., or the Equity Research Group guaran-\\ntees the accuracy of the translations.',\n", " 'This report may be distributed in certain localities, coun-\\ntries and/or jurisdictions (“Territories”) by independent \\nthird parties or independent intermediaries and/or distrib-\\nutors (“Distributors”). Such Distributors are not acting as \\nagents or representatives of the analyst, Morningstar, \\nInc. or the Equity Research Group. In Territories where a \\nDistributor distributes our report, the Distributor is solely \\nresponsible for complying with all applicable regulations, \\nlaws, rules, circulars, codes and guidelines established by \\nlocal and/or regional regulatory bodies, including laws in \\nconnection with the distribution third-party research re-\\nports.\\nConflicts of Interest\\nuNo interests are held by the analyst with respect to the \\nsecurity subject of this investment research report.\\nuMorningstar, Inc.',\n", " 'uMorningstar, Inc. may hold a long position in the se-\\ncurity subject of this investment research report that \\nexceeds 0.5% of the total issued share capital of the \\nsecurity. To determine if such is the case, please click \\nhttp://msi.morningstar.com and http://mdi.morning-\\nstar.com\\nuAnalysts’ compensation is derived from Morningstar, \\nInc.’s overall earnings and consists of salary, bonus \\nand in some cases restricted stock.\\nuNeither Morningstar, Inc. or the Equity Research Group \\nreceives commissions for providing research nor do \\nthey charge companies to be rated.\\nuNeither Morningstar, Inc. or the Equity Research Group \\nis a market maker or a liquidity provider of the security \\nnoted within this report.\\nuNeither Morningstar, Inc.',\n", " 'uNeither Morningstar, Inc. or the Equity Research Group \\nhas been a lead manager or co-lead manager over the \\nprevious 12-months of any publicly disclosed offer of \\nfinancial instruments of the issuer.\\nuMorningstar, Inc.’s investment management group \\ndoes have arrangements with financial institutions to \\nprovide portfolio management/investment advice some \\nof which an analyst may issue investment research re-\\nports on. However, analysts do not have authority over \\nMorningstar’s investment management group’s busi-\\nness arrangements nor allow employees from the in-\\nvestment management group to participate or influ-\\nence the analysis or opinion prepared by them.\\nMorningstar, Inc. is a publicly traded company (Ticker \\nSymbol: MORN) and thus a financial institution the se-\\ncurity of which is the subject of this report may own umore than 5% of Morningstar, Inc.’s total outstanding \\nshares.',\n", " 'Please access Morningstar, Inc.’s proxy state-\\nment, “Security Ownership of Certain Beneficial Own-\\ners and Management” section https://\\nshareholders.morningstar.com/investor-relations/fin-\\nancials/sec-filings/default.aspx\\nuMorningstar, Inc. may provide the product issuer or its \\nrelated entities with services or products for a fee and \\non an arms’ length basis including software products \\nand licenses, research and consulting services, data \\nservices, licenses to republish our ratings and research \\nin their promotional material, event sponsorship and \\nwebsite advertising.\\nFurther information on Morningstar, Inc.’s conflict of in-\\nterest policies is available from https://\\nshareholders.morningstar.com Also, please note analysts \\nare subject to the CFA Institute’s Code of Ethics and \\nStandards of Professional Conduct.',\n", " 'For a list of securities which the Equity Research Group \\ncurrently covers and provides written analysis on please \\ncontact your local Morningstar office. In addition, for his-\\ntorical analysis of securities covered, including their fair \\nvalue estimate, please contact your local office.\\nFor Recipients in Australia: This Report has been issued \\nand distributed in Australia by Morningstar Australasia \\nPty Ltd (ABN: 95 090 665 544; ASFL: 240892 ). Morning-\\nstar Australasia Pty Ltd is the provider of the general ad-\\nvice (‘the Service’) and takes responsibility for the produc-\\ntion of this report. The Service is provided through the re-\\nsearch of investment products.\\nTo the extent the Report contains general advice it has \\nbeen prepared without reference to an investor’s object-\\nives, financial situation or needs.',\n", " 'Investors should con-\\nsider the advice in light of these matters and, if applic-\\nable, the relevant Product Disclosure Statement before \\nmaking any decision to invest. Refer to our Financial Ser-\\nvices Guide (FSG) for more information at http://\\nwww.morningstar.com.au/fsg.pdf\\nFor Recipients in New Zealand: This report has been is-\\nsued and distributed by Morningstar Australasia Pty Ltd \\nand/or Morningstar Research Ltd (together ‘Morning-\\nstar’). Morningstar is the provider of the regulated finan-\\ncial advice and takes responsibility for the production of \\nthis report. To the extent the report contains regulated \\nfinancial advice it has been prepared without reference to \\nan investor’s objectives, financial situation or needs. In-\\nvestors should consider the advice in light of these mat-\\nters and, if applicable, the relevant Product Disclosure \\nStatement before making any decision to invest.',\n", " 'Refer to \\nour Financial Advice Provider Disclosure Statement at \\nwww.morningstar.com.au/s/fapds.pdf for more informa-tion.\\nFor Recipients in Hong Kong: The Report is distributed \\nby Morningstar Investment Management Asia Limited, \\nwhich is regulated by the Hong Kong Securities and Fu-\\ntures Commission to provide services to professional in-\\nvestors only. Neither Morningstar Investment Manage-\\nment Asia Limited, nor its representatives, are acting or \\nwill be deemed to be acting as an investment profession-\\nal to any recipients of this information unless expressly \\nagreed to by Morningstar Investment Management Asia \\nLimited. For enquiries regarding this research, please con-\\ntact a Morningstar Investment Management Asia Limited \\nLicensed Representative at https://shareholders.morning-\\nstar.com\\nFor recipients in India: This Investment Research is is-\\nsued by Morningstar Investment Adviser India Private \\nLimited.',\n", " 'Morningstar Investment Adviser India Private \\nLimited is registered with the Securities and Exchange \\nBoard of India (Registration number INA000001357 ) and \\nprovides investment advice and research. Morningstar In-\\nvestment Adviser India Private Limited has not been the \\nsubject of any disciplinary action by SEBI or any other leg-\\nal/regulatory body. Morningstar Investment Adviser India \\nPrivate Limited is a wholly owned subsidiary of Morning-\\nstar Investment Management LLC. In India, Morningstar \\nInvestment Adviser India Private Limited has one asso-\\nciate, Morningstar India Private Limited, which provides \\ndata related services, financial data analysis and software \\ndevelopment. The Research Analyst has not served as an \\nofficer, director or employee of the fund company within \\nthe last 12 months, nor has it or its associates engaged in \\nmarket making activity for the fund company.',\n", " '*The Conflicts of Interest disclosure above also applies to \\nrelatives and associates of Manager Research Analysts in \\nIndia # The Conflicts of Interest disclosure above also ap-\\nplies to associates of Manager Research Analysts in In-\\ndia. The terms and conditions on which Morningstar In-\\nvestment Adviser India Private Limited offers Investment \\nResearch to clients, varies from client to client, and are \\ndetailed in the respective client agreement.\\nFor recipients in Japan: The Report is distributed by Ib-\\nbotson Associates Japan, Inc., which is regulated by Fin-\\nancial Services Agency. Neither Ibbotson Associates Ja-\\npan, Inc., nor its representatives, are acting or will be \\ndeemed to be acting as an investment professional to any \\nrecipients of this information.\\nFor recipients in Singapore: For Institutional Investor \\naudiences only.',\n", " 'For recipients in Singapore: For Institutional Investor \\naudiences only. Recipients of this report should contact \\ntheir financial professional in Singapore in relation to this \\nreport. Morningstar, Inc., and its affiliates, relies on cer-\\ntain exemptions (Financial Advisers Regulations, Section',\n", " 'Morningstar Equity Company Report | Report as of 26 Jan 2023 00:20, UTC | Reporting Currency: USD | Trading Currency: USD | Exchange: NEW YORK STOCK EXCHANGE, INC. Page 26 of 26\\n©2023 Morningstar. All Rights Reserved. Unless otherwise provided in a separate agreement, you may use this report only in the country in which its original distributor is based. The information, data, analyses and \\nopinions presented herein do not constitute investment advice; are provided solely for informational purposes and therefore are not an offer to buy or sell a security; and are not warranted to be correct, complete or \\naccurate. The opinions expressed are as of the date written and are subject to change without notice. Except as otherwise required by law, Morningstar shall not be responsible for any trading decisions, damages or \\nother losses resulting from, or related to, the information, data, analyses or opinions or their use. The information contained herein is the proprietary property of Morningstar and may not be reproduced, in whole or in \\npart, or used in any manner, without the prior written consent of Morningstar.',\n", " 'Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research \\nServices LLC, registered with and governed by the U.S. Securities and Exchange Commission. To order reprints, call +1 312-696-6100. To license the research, call +1 312-696-6869. Please see important disclosures at \\nthe end of this report.ß ®Research Methodology for Valuing Companies\\n32B and 32C) to provide its investment research to recipi-\\nents in Singapore.']}" ] }, "execution_count": 9, "metadata": {}, "output_type": "execute_result" } ], "source": [ "contents_splits" ] }, { "cell_type": "code", "execution_count": 10, "metadata": {}, "outputs": [ { "data": { "text/plain": [ "41" ] }, "execution_count": 10, "metadata": {}, "output_type": "execute_result" } ], "source": [ "len(contents_splits['AMZN_Moodys_CreditRating_2023.pdf'])" ] }, { "cell_type": "code", "execution_count": 11, "metadata": {}, "outputs": [ { "data": { "text/plain": [ "\"Exhibit 1\\nAmazon's debt has continued to rise as operating income remains below 2019\\n$0$20,000$40,000$60,000$80,000$100,000$120,000$140,000$160,000$180,000\\n$0$5,000$10,000$15,000$20,000$25,000$30,000\\n2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1 -23 LTM\\nMoody's Adjusted Debt (USD Millions)Moody's Adj. Operating Income (USD Millions)Moody's adjusted operating income Moody's adjusted debt\\nDebt includes lease\\nSource: Moody’s Financial Metrics™\"" ] }, "execution_count": 11, "metadata": {}, "output_type": "execute_result" } ], "source": [ "contents_splits['AMZN_Moodys_CreditRating_2023.pdf'][2]" ] }, { "cell_type": "code", "execution_count": 12, "metadata": {}, "outputs": [ { "name": "stderr", "output_type": "stream", "text": [ "/Volumes/DATA/Dropbox/IMAC_BACKUP/WORK/PROJECTS/LIQUIDITY/venv/lib/python3.10/site-packages/tqdm/auto.py:21: TqdmWarning: IProgress not found. Please update jupyter and ipywidgets. See https://ipywidgets.readthedocs.io/en/stable/user_install.html\n", " from .autonotebook import tqdm as notebook_tqdm\n", "/Volumes/DATA/Dropbox/IMAC_BACKUP/WORK/PROJECTS/LIQUIDITY/venv/lib/python3.10/site-packages/huggingface_hub/file_download.py:1132: FutureWarning: `resume_download` is deprecated and will be removed in version 1.0.0. Downloads always resume when possible. If you want to force a new download, use `force_download=True`.\n", " warnings.warn(\n" ] }, { "data": { "text/plain": [ "SentenceTransformer(\n", " (0): Transformer({'max_seq_length': 384, 'do_lower_case': False}) with Transformer model: MPNetModel \n", " (1): Pooling({'word_embedding_dimension': 768, 'pooling_mode_cls_token': False, 'pooling_mode_mean_tokens': True, 'pooling_mode_max_tokens': False, 'pooling_mode_mean_sqrt_len_tokens': False, 'pooling_mode_weightedmean_tokens': False, 'pooling_mode_lasttoken': False, 'include_prompt': True})\n", " (2): Normalize()\n", ")" ] }, "execution_count": 12, "metadata": {}, "output_type": "execute_result" } ], "source": [ "from sentence_transformers import SentenceTransformer\n", "# model_name = 'sentence-transformers/all-MiniLM-L6-v2'\n", "model_name = 'sentence-transformers/all-mpnet-base-v2' # models/bge-base-en-v1.5-finetuned-300\" # @param [\"sentence-transformers/all-MiniLM-L6-v2\", \"BAAI/bge-base-en-v1.5\", \"BAAI/bge-large-en-v1.5\", \"models/bge-base-en-v1.5-finetuned-300\"]\n", "model = SentenceTransformer(model_name)\n", "model" ] }, { "cell_type": "code", "execution_count": 23, "metadata": {}, "outputs": [], "source": [ "model.save('models/all-mpnet-base-v2')" ] }, { "cell_type": "code", "execution_count": 40, "metadata": {}, "outputs": [ { "name": "stderr", "output_type": "stream", "text": [ "100%|██████████| 10/10 [00:00<00:00, 2275.31it/s]\n" ] }, { "data": { "text/html": [ "
{\n",
       "│   'AMZN_Moodys_CreditRating_2023.pdf': array([[ 0.00653717,  0.04075233, -0.03533785, ..., -0.02685172,\n",
       "│   │   -0.08349632, -0.04063725],\n",
       "│      [-0.00831637,  0.02911858, -0.0268451 , ..., -0.04759425,\n",
       "│   │   -0.05915821, -0.04474585],\n",
       "│      [ 0.00700969,  0.05966565, -0.03596259, ..., -0.06386882,\n",
       "│   │   -0.05417442, -0.05082626],\n",
       "│      ...,\n",
       "│      [-0.01083744, -0.00643638, -0.00708611, ..., -0.0603921 ,\n",
       "│   │   -0.04247801, -0.02054212],\n",
       "│      [-0.00930036,  0.03847416, -0.02732005, ..., -0.07412596,\n",
       "│   │   -0.06348179, -0.05091593],\n",
       "│      [ 0.00102988, -0.00645397, -0.0192056 , ..., -0.01543786,\n",
       "│   │   -0.05466838, -0.02234057]], dtype=float32)\n",
       "}\n",
       "
\n" ], "text/plain": [ "\u001b[1m{\u001b[0m\n", "\u001b[2;32m│ \u001b[0m\u001b[32m'AMZN_Moodys_CreditRating_2023.pdf'\u001b[0m: \u001b[1;35marray\u001b[0m\u001b[1m(\u001b[0m\u001b[1m[\u001b[0m\u001b[1m[\u001b[0m \u001b[1;36m0.00653717\u001b[0m, \u001b[1;36m0.04075233\u001b[0m, \u001b[1;36m-0.03533785\u001b[0m, \u001b[33m...\u001b[0m, \u001b[1;36m-0.02685172\u001b[0m,\n", "\u001b[2;32m│ │ \u001b[0m\u001b[1;36m-0.08349632\u001b[0m, \u001b[1;36m-0.04063725\u001b[0m\u001b[1m]\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[1m[\u001b[0m\u001b[1;36m-0.00831637\u001b[0m, \u001b[1;36m0.02911858\u001b[0m, \u001b[1;36m-0.0268451\u001b[0m , \u001b[33m...\u001b[0m, \u001b[1;36m-0.04759425\u001b[0m,\n", "\u001b[2;32m│ │ \u001b[0m\u001b[1;36m-0.05915821\u001b[0m, \u001b[1;36m-0.04474585\u001b[0m\u001b[1m]\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[1m[\u001b[0m \u001b[1;36m0.00700969\u001b[0m, \u001b[1;36m0.05966565\u001b[0m, \u001b[1;36m-0.03596259\u001b[0m, \u001b[33m...\u001b[0m, \u001b[1;36m-0.06386882\u001b[0m,\n", "\u001b[2;32m│ │ \u001b[0m\u001b[1;36m-0.05417442\u001b[0m, \u001b[1;36m-0.05082626\u001b[0m\u001b[1m]\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[33m...\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[1m[\u001b[0m\u001b[1;36m-0.01083744\u001b[0m, \u001b[1;36m-0.00643638\u001b[0m, \u001b[1;36m-0.00708611\u001b[0m, \u001b[33m...\u001b[0m, \u001b[1;36m-0.0603921\u001b[0m ,\n", "\u001b[2;32m│ │ \u001b[0m\u001b[1;36m-0.04247801\u001b[0m, \u001b[1;36m-0.02054212\u001b[0m\u001b[1m]\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[1m[\u001b[0m\u001b[1;36m-0.00930036\u001b[0m, \u001b[1;36m0.03847416\u001b[0m, \u001b[1;36m-0.02732005\u001b[0m, \u001b[33m...\u001b[0m, \u001b[1;36m-0.07412596\u001b[0m,\n", "\u001b[2;32m│ │ \u001b[0m\u001b[1;36m-0.06348179\u001b[0m, \u001b[1;36m-0.05091593\u001b[0m\u001b[1m]\u001b[0m,\n", "\u001b[2;32m│ \u001b[0m\u001b[1m[\u001b[0m \u001b[1;36m0.00102988\u001b[0m, \u001b[1;36m-0.00645397\u001b[0m, \u001b[1;36m-0.0192056\u001b[0m , \u001b[33m...\u001b[0m, \u001b[1;36m-0.01543786\u001b[0m,\n", "\u001b[2;32m│ │ \u001b[0m\u001b[1;36m-0.05466838\u001b[0m, \u001b[1;36m-0.02234057\u001b[0m\u001b[1m]\u001b[0m\u001b[1m]\u001b[0m, \u001b[33mdtype\u001b[0m=\u001b[35mfloat32\u001b[0m\u001b[1m)\u001b[0m\n", "\u001b[1m}\u001b[0m\n" ] }, "metadata": {}, "output_type": "display_data" } ], "source": [ "os.environ[\"TOKENIZERS_PARALLELISM\"] = \"true\"\n", "pool = model.start_multi_process_pool()\n", "\n", "content_embeddings = {}\n", "for fname, splits in contents_splits.items():\n", " content_embeddings[fname] = model.encode_multi_process(tqdm(splits), pool)\n", "\n", "model.stop_multi_process_pool(pool)\n", "pprint(content_embeddings, max_length = 3)" ] }, { "cell_type": "code", "execution_count": 69, "metadata": {}, "outputs": [ { "name": "stderr", "output_type": "stream", "text": [ "100%|██████████| 41/41 [00:07<00:00, 5.77it/s]\n" ] } ], "source": [ "content_embeddings = {}\n", "for fname, splits in contents_splits.items():\n", " content_embeddings[fname] = [(split, model.encode(split)) for split in tqdm(splits)]" ] }, { "cell_type": "code", "execution_count": 75, "metadata": {}, "outputs": [ { "data": { "text/plain": [ "(\"Exhibit 1\\nAmazon's debt has continued to rise as operating income remains below 2019\\n$0$20,000$40,000$60,000$80,000$100,000$120,000$140,000$160,000$180,000\\n$0$5,000$10,000$15,000$20,000$25,000$30,000\\n2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1 -23 LTM\\nMoody's Adjusted Debt (USD Millions)Moody's Adj. Operating Income (USD Millions)Moody's adjusted operating income Moody's adjusted debt\\nDebt includes lease\\nSource: Moody’s Financial Metrics™\",\n", " array([-1.30822426e-02, 6.86794445e-02, -2.04694420e-02, -1.38254010e-03,\n", " 3.70225944e-02, 3.41216698e-02, 2.21263207e-02, -7.08647957e-03,\n", " -1.05572930e-02, -6.59325495e-02, -1.74689535e-02, 6.06168024e-02,\n", " 2.91264486e-02, -5.47851063e-03, -2.59431135e-02, 2.88099833e-02,\n", " -2.17851647e-03, 3.94609245e-03, -2.27084663e-02, 6.04690704e-03,\n", " -1.23097841e-02, 3.90404537e-02, -3.76035273e-02, -8.56765434e-02,\n", " -1.37383323e-02, -4.62083854e-02, 1.65111329e-02, -3.10253035e-02,\n", " -7.45378248e-03, -3.46138589e-02, 2.48384960e-02, -3.28771919e-02,\n", " 6.75628055e-03, 3.01973801e-03, 2.04046523e-06, -4.99916486e-02,\n", " -2.59188283e-02, -7.47009087e-03, -6.54836744e-03, 2.51934268e-02,\n", " -2.13395748e-02, 5.64569309e-02, 1.84528101e-02, 8.15049186e-03,\n", " -5.41897677e-02, -5.19619845e-02, 2.29025520e-02, -1.20087070e-02,\n", " -3.73521596e-02, -1.27722351e-02, 2.42908280e-02, -6.14535110e-03,\n", " -3.80063504e-02, 1.04772449e-02, -2.66266800e-02, -2.60236710e-02,\n", " -1.87401325e-02, 7.96711966e-02, -3.50813679e-02, -1.06564902e-01,\n", " -4.67046686e-02, 5.38960062e-02, 4.69599143e-02, 6.10306300e-03,\n", " 1.66898258e-02, 4.40238565e-02, 5.84423840e-02, 1.28696701e-02,\n", " 4.91133751e-03, -5.91863021e-02, 1.12483762e-01, -2.47345697e-02,\n", " 2.10161917e-02, 3.34593616e-02, 6.65128082e-02, 2.12803539e-02,\n", " -1.68083161e-02, 8.49922094e-03, -4.63134469e-03, 7.96298403e-03,\n", " -4.02773470e-02, 2.86344886e-02, 2.95153540e-03, 6.28840923e-02,\n", " -2.90736090e-02, -1.31860725e-03, -3.46784927e-02, -5.32559827e-02,\n", " -3.17503661e-02, -7.12026469e-03, 1.57476738e-02, -5.25717624e-02,\n", " 6.52080551e-02, -1.00841317e-02, 1.22182723e-02, 2.51448806e-02,\n", " -7.69760273e-03, -1.08635969e-01, -3.06620486e-02, 2.53417622e-02,\n", " -3.37197855e-02, -5.85950166e-03, -2.57773120e-02, 3.48519757e-02,\n", " -4.19392176e-02, 6.98788613e-02, -2.27051079e-02, -1.87884979e-02,\n", " -1.74566917e-02, 7.25322589e-02, 4.59078513e-02, -2.04226598e-02,\n", " -2.09461302e-02, 5.10274842e-02, -3.53652537e-02, -1.76033080e-02,\n", " 2.04331856e-02, -3.32486145e-02, -1.07541773e-02, -6.97967364e-03,\n", " -1.18669157e-03, 3.61218639e-02, 3.33560258e-02, 1.51100168e-02,\n", " 2.14882493e-02, 2.50491537e-02, -4.26772647e-02, 2.37349886e-02,\n", " 1.83920730e-02, 5.42547330e-02, 5.58209307e-02, -6.92852074e-03,\n", " 3.31262276e-02, -4.55844067e-02, 5.10270335e-02, 1.95382126e-02,\n", " 7.85721745e-03, 2.01443350e-03, 5.32192811e-02, 9.43052024e-03,\n", " 3.62611711e-02, 3.01933661e-03, -1.97709212e-03, 5.08906022e-02,\n", " 9.08650365e-03, 2.13539675e-02, 9.42533006e-05, 1.12538012e-02,\n", " -6.83079055e-03, 3.19605656e-02, 1.81893427e-02, -1.30560864e-02,\n", " -9.30138156e-02, -4.64175157e-02, 1.77484062e-02, -2.06251349e-03,\n", " 4.65017147e-02, -8.18580016e-02, 1.00063667e-01, -3.52837779e-02,\n", " 2.31651049e-02, -1.38793057e-02, -4.87621054e-02, -1.94292683e-02,\n", " 1.45647014e-02, -4.01977934e-02, 6.96172640e-02, 2.37370376e-02,\n", " -9.23759043e-02, 1.61475260e-02, -8.80606007e-03, 1.73066799e-02,\n", " -9.09369532e-03, -1.87119804e-02, 5.06179519e-02, -2.36426629e-02,\n", " -3.92305739e-02, 3.89048737e-03, -5.53253256e-02, 2.50215433e-03,\n", " 8.96981079e-03, -5.14933653e-02, -3.36669087e-02, -1.11867050e-02,\n", " -4.34783921e-02, 6.35092780e-02, 1.27748139e-02, -2.62409467e-02,\n", " -8.91975407e-03, -2.03884039e-02, -4.11097929e-02, 1.82099659e-02,\n", " -2.38592103e-02, 8.65971670e-03, -1.91893138e-03, 1.19269416e-02,\n", " -2.40607187e-02, 4.84072343e-02, 2.44352687e-02, 2.35939752e-02,\n", " -4.98230197e-03, -1.85759366e-02, 6.30668774e-02, -2.88228914e-02,\n", " 3.03922184e-02, -7.45051401e-03, -1.88441463e-02, -2.03592256e-02,\n", " -1.21778315e-02, 1.64638124e-02, -2.72407872e-03, 3.23132835e-02,\n", " -4.77909856e-02, -9.83782299e-03, 1.52339749e-02, 9.63843334e-03,\n", " 2.74731126e-03, 9.13294673e-04, -5.89565001e-02, -1.06958868e-02,\n", " 1.14645036e-02, -6.56168684e-02, 2.01627635e-03, 2.11368240e-02,\n", " -2.47231852e-02, 5.06932400e-02, 8.31357203e-03, 4.56814328e-03,\n", " -4.17992659e-03, 2.42034588e-02, 2.02601403e-02, 7.11259898e-03,\n", " 3.39201395e-03, 4.50700372e-02, -8.54347833e-03, 4.61718403e-02,\n", " 4.17957157e-02, 7.83614591e-02, 3.52505744e-02, 5.15415296e-02,\n", " -1.05276620e-02, -4.80116950e-03, 3.77700962e-02, 2.44977698e-02,\n", " -4.63933684e-03, -1.61893405e-02, 4.27615307e-02, 8.90567992e-03,\n", " -2.13807058e-02, 4.24766988e-02, 2.34891661e-02, 5.43062761e-02,\n", " 3.23736295e-02, -3.93930543e-03, 2.35331357e-02, -5.83492182e-02,\n", " 9.05591901e-03, -2.42530778e-02, 6.10181987e-02, 1.76380072e-02,\n", " -4.93654646e-02, -5.98268062e-02, -2.69363075e-03, -2.00153440e-02,\n", " -3.85750551e-03, -2.55474690e-02, 8.07096511e-02, 3.66657227e-02,\n", " -2.83400877e-03, 5.78321656e-03, 7.78581994e-03, -1.78813282e-02,\n", " -3.13225724e-02, -2.82812547e-02, 4.39692289e-02, 3.85123566e-02,\n", " -9.47690383e-03, 8.01691972e-03, 6.80977153e-03, 3.78251728e-03,\n", " 4.45465632e-02, -5.76248206e-02, 8.43021646e-03, -5.20041492e-03,\n", " -1.99493133e-02, 2.70470278e-03, 4.04501967e-02, -7.03166872e-02,\n", " -1.85063764e-04, 7.48446286e-02, -2.74306573e-02, -3.51001322e-02,\n", " 1.01415161e-02, 1.57890711e-02, 1.73276775e-02, -2.27032173e-02,\n", " -2.18968969e-02, -1.00431507e-02, 9.16640833e-03, 3.11600007e-02,\n", " -4.09311093e-02, -4.58005257e-02, 3.39280441e-02, 1.69334356e-02,\n", " 2.19322983e-02, 4.13929559e-02, 6.42376319e-02, 2.95801777e-02,\n", " 1.16020329e-02, 4.21454245e-03, -1.31885577e-02, -4.60835965e-03,\n", " 1.20943794e-02, -1.02552883e-02, 2.76965424e-02, -9.11832079e-02,\n", " 5.79996035e-04, 6.79408014e-02, -5.25654517e-02, 8.11243802e-02,\n", " 5.59299178e-02, -2.49804929e-02, -8.17611441e-03, -2.24630833e-02,\n", " 2.63812598e-02, 1.58858318e-02, 5.34065403e-02, 3.73816118e-02,\n", " -1.38453143e-02, -3.88685204e-02, 7.83019513e-03, 8.65164120e-03,\n", " -4.06212397e-02, 5.18509969e-02, 2.35001501e-02, 3.86989899e-02,\n", " 1.30462619e-02, 1.02417953e-02, 5.11043295e-02, -6.29832596e-03,\n", " 1.66331157e-02, 1.38166128e-02, 3.19190286e-02, 7.43820798e-03,\n", " 2.18015667e-02, -1.30629139e-02, -4.10612766e-03, -8.19696486e-03,\n", " -7.93747455e-02, -2.32873298e-02, -1.24585228e-02, -5.20277359e-02,\n", " -3.30812000e-02, 1.64733101e-02, -2.72735575e-04, -1.06801931e-02,\n", " -4.64327149e-02, 2.70462763e-02, 4.88208719e-02, -6.11840039e-02,\n", " -5.28457835e-02, -1.05021279e-02, 3.51999211e-03, 2.41471473e-02,\n", " 9.48598329e-03, 1.46880548e-03, -2.04641260e-02, 4.78906333e-02,\n", " -1.46473255e-02, 1.56712681e-02, -1.01578169e-01, -1.90601088e-02,\n", " -2.73797233e-02, -2.83131488e-02, 3.67659666e-02, 2.54664794e-02,\n", " 4.59275469e-02, -7.32905557e-03, -7.79789407e-04, 3.24548851e-03,\n", " 3.61962728e-02, -7.13668391e-02, 3.70897315e-02, -7.20631611e-03,\n", " 3.43065569e-03, 5.52504212e-02, -6.28121123e-02, -5.40962070e-02,\n", " -5.95115907e-02, -5.76109923e-02, -4.24496494e-02, 5.19758314e-02,\n", " 2.16194540e-02, 1.93847232e-02, 8.93862825e-03, -1.49568450e-02,\n", " -3.07048950e-02, -1.53026478e-02, 1.65397059e-02, 2.90287621e-02,\n", " -6.83825987e-04, -4.74575609e-02, 3.80975418e-02, -1.15118567e-02,\n", " -7.40018301e-03, -6.33319393e-02, -4.01351228e-03, 3.16449441e-02,\n", " -7.23923594e-02, 9.72558782e-02, -1.93683524e-02, 2.95799319e-02,\n", " -8.22599046e-03, -5.69765829e-03, 3.98904048e-02, -1.61568057e-02,\n", " -1.44599518e-02, 7.05007650e-03, 4.05855011e-04, -4.37361933e-02,\n", " -1.26948971e-02, -1.11154979e-02, -1.00488989e-02, 4.13396917e-02,\n", " 9.14984848e-03, 6.54016510e-02, 1.08878007e-02, -6.41224608e-02,\n", " -3.32508236e-02, -5.18029816e-02, 1.56731624e-02, -6.25696313e-03,\n", " -8.52264166e-02, -5.30139245e-02, -1.37347683e-01, 1.28710657e-01,\n", " -6.55219285e-03, -1.73675343e-02, 4.71802838e-02, -1.23125436e-02,\n", " -7.20340684e-02, -8.65201582e-04, 1.85009819e-02, 3.63245904e-02,\n", " -4.01456617e-02, 1.56445988e-02, 2.26647649e-02, 3.15924846e-02,\n", " -1.12873621e-01, 9.25243367e-03, 2.68885680e-02, -2.12778710e-02,\n", " 3.65848355e-02, -2.88699828e-02, 1.37048056e-02, -2.92325243e-02,\n", " -4.36005592e-02, -5.71912080e-02, 1.91375744e-02, 2.04910375e-02,\n", " 1.48888975e-02, 8.19225702e-03, -4.33895923e-02, 3.26171108e-02,\n", " 1.77272242e-02, 5.74482232e-03, 8.37014690e-02, -3.36625688e-02,\n", " -1.33998152e-02, -3.96112027e-03, -1.19536091e-02, -9.17326135e-04,\n", " 6.70010503e-03, 2.20768265e-02, -3.59684899e-02, -8.80573760e-04,\n", " 2.28729546e-02, -3.01370770e-02, 2.24762913e-02, 3.66219901e-03,\n", " -9.54741612e-03, -3.29571255e-02, 3.98165639e-03, -8.85787457e-02,\n", " -3.09156105e-02, 1.36897562e-03, 3.26864570e-02, 3.99899902e-03,\n", " 1.14651881e-02, -1.72465239e-02, 2.28910963e-03, 2.03124061e-02,\n", " 1.06943417e-02, 1.43289894e-01, 5.20551503e-02, -2.46592611e-02,\n", " -1.02734230e-05, 1.58731395e-03, -4.30032378e-03, -2.24402025e-02,\n", " 2.98288855e-04, -1.09369438e-02, 2.50303466e-02, -6.07215846e-03,\n", " 1.80287156e-02, 3.46449316e-02, 1.12862829e-02, 4.90318164e-02,\n", " 3.23307440e-02, 3.76754180e-02, -4.59313132e-02, 2.61204485e-02,\n", " 4.73373942e-02, 5.30541353e-02, 4.14576530e-02, 5.01628360e-03,\n", " -5.43788150e-02, -1.32478420e-02, 1.87425110e-02, -2.64934320e-02,\n", " -1.04834503e-02, 1.22979749e-02, 5.52364951e-03, 1.09609207e-02,\n", " 1.29507165e-02, 2.11910624e-03, -4.45753243e-03, -3.02640162e-02,\n", " 5.69324866e-02, 7.99652096e-03, 3.13234255e-02, -2.61790417e-02,\n", " -3.20855156e-02, 4.35708314e-02, 7.15713715e-03, 1.69495493e-02,\n", " 1.58117358e-02, -6.02521673e-02, 5.29648550e-02, 7.88331311e-03,\n", " 2.54039820e-02, -1.86400674e-02, 2.03129253e-03, -3.47736180e-02,\n", " 2.10746322e-02, -6.74167275e-02, -2.39573773e-02, -2.64450000e-03,\n", " 3.92975770e-02, 3.68434638e-02, 3.20615508e-02, 2.25342601e-03,\n", " -1.01189546e-01, 1.09771080e-02, -2.79388707e-02, -5.41569202e-33,\n", " 7.49955047e-03, -6.36478588e-02, 7.02982768e-03, -2.90835388e-02,\n", " 9.45421029e-03, 6.15611821e-02, -1.64384004e-02, -6.38744095e-03,\n", " -5.45242503e-02, 2.69422289e-02, -4.61026058e-02, 1.78014021e-02,\n", " 1.92258861e-02, -2.42455094e-03, -1.82896126e-02, -6.86622690e-03,\n", " -4.22992669e-02, -2.57497262e-02, -1.34662837e-02, -1.03820385e-02,\n", " 4.92727617e-03, 3.85194756e-02, 6.27362430e-02, -5.69756962e-02,\n", " 1.02587864e-02, 1.02911599e-03, -4.25549820e-02, -2.78350767e-02,\n", " -6.36914885e-03, 2.74364911e-02, -3.15533057e-02, 3.65241850e-03,\n", " -2.09460463e-02, -4.13228683e-02, -1.87142454e-02, -5.15606515e-02,\n", " 3.19950357e-02, -1.12613384e-02, 3.70989740e-02, -6.61517167e-03,\n", " -1.15462653e-02, 4.36953222e-03, 1.00496151e-02, 5.72656989e-02,\n", " -1.98204746e-03, -7.40171075e-02, -1.63343325e-02, -4.49059047e-02,\n", " 1.19281402e-02, -5.82534000e-02, 1.22298952e-02, 7.86946621e-03,\n", " -2.46008653e-02, 2.89156344e-02, 1.71755964e-03, 9.29676145e-02,\n", " -2.48810444e-02, 4.60915565e-02, -4.66338471e-02, 2.94734561e-03,\n", " -1.64162852e-02, 3.34381908e-02, 2.64201947e-02, -4.30351458e-02,\n", " -6.99209189e-03, -3.68187274e-03, -5.31777777e-02, -4.00247015e-02,\n", " 4.66059428e-03, 3.91457006e-02, -2.91039090e-04, 1.15332296e-02,\n", " -6.66677766e-03, -3.23977321e-02, 8.55878461e-03, 4.53509614e-02,\n", " 1.50789199e-02, 7.02710403e-03, 7.33971177e-03, 6.03297427e-02,\n", " 3.11565027e-02, -3.91476937e-02, -1.01533933e-02, 1.08473599e-02,\n", " 4.16278094e-02, -1.10033035e-01, -9.49698687e-03, -1.35726593e-02,\n", " -6.74126728e-04, -4.41983826e-02, -5.55213308e-03, 3.05683389e-02,\n", " 5.61929354e-03, 1.01020385e-03, -1.35393500e-01, 1.40168862e-02,\n", " -1.52924918e-02, -2.53122096e-04, -1.24141332e-02, -2.46806331e-02,\n", " 3.55592743e-02, 1.30004315e-02, -2.85984017e-02, 4.10970785e-02,\n", " 3.14407460e-02, 5.51349204e-03, 4.64193076e-02, -9.28545464e-03,\n", " 1.39931834e-03, 5.02718193e-03, 5.46849780e-02, -8.88720807e-03,\n", " 5.94939291e-02, 3.06016486e-02, -2.55279969e-02, 1.80637520e-02,\n", " 2.40167025e-02, 5.60011752e-02, 3.92341763e-02, -9.20801237e-03,\n", " -2.50747465e-02, 1.12026790e-02, -4.15778086e-02, -4.70827194e-03,\n", " -2.21217535e-02, 4.31981543e-03, -9.83860716e-03, -1.64278168e-02,\n", " -3.64682707e-03, -8.61813277e-02, -3.22211394e-03, 4.03657481e-02,\n", " 2.68878523e-07, 1.61355883e-02, 2.03971695e-02, -1.31999692e-02,\n", " 1.36681134e-02, -3.36480588e-02, 3.15806605e-02, 1.50782857e-04,\n", " -5.04364399e-03, 7.24044396e-03, -1.67327691e-02, -1.77822262e-02,\n", " -6.31900690e-03, 2.64777360e-03, 5.09659089e-02, 3.14899517e-04,\n", " -7.43458495e-02, -7.04061314e-02, -3.44001167e-02, -5.67576773e-02,\n", " 5.71441930e-03, -4.73885704e-03, 2.76432484e-02, 3.01589239e-02,\n", " -2.14675367e-02, -1.80490166e-02, -6.00098707e-02, -3.16327736e-02,\n", " -3.43492776e-02, -2.46099737e-02, 1.43431360e-03, -4.15919907e-03,\n", " -1.48784053e-02, -2.24927571e-02, -6.06202446e-02, -3.56335416e-02,\n", " 1.53280795e-02, -3.00227152e-03, -3.21667418e-02, 3.23264636e-02,\n", " 5.04905842e-02, 4.14200425e-02, -2.44385679e-03, 3.92021658e-03,\n", " -7.29420129e-03, 1.49195008e-02, 3.10070571e-02, -1.60520244e-02,\n", " 1.87573209e-02, 1.63214933e-02, 1.76218282e-02, -2.88427491e-02,\n", " -1.33436518e-02, -7.16673955e-02, 1.29198432e-02, 9.61886253e-03,\n", " -2.06801686e-02, 8.87486991e-03, -2.24887580e-02, 3.88072878e-02,\n", " 2.86401864e-02, -4.06580679e-02, 5.75414598e-02, -3.81956771e-02,\n", " 8.12523440e-02, 1.68273151e-02, 6.67139068e-02, -2.55011092e-03,\n", " 2.04327344e-34, -7.28886388e-03, -5.83410263e-02, 2.56349519e-02,\n", " 8.75714701e-03, 2.07658224e-02, -3.15369330e-02, 1.58587587e-03,\n", " 7.26209302e-03, -6.40058294e-02, -5.44188581e-02, -4.43128236e-02],\n", " dtype=float32))" ] }, "execution_count": 75, "metadata": {}, "output_type": "execute_result" } ], "source": [ "content_embeddings['AMZN_Moodys_CreditRating_2023.pdf'][2]" ] }, { "cell_type": "code", "execution_count": 28, "metadata": {}, "outputs": [], "source": [ "# sys.path.append(os.path.join(os.curdir, '..'))\n", "from engine.fileIO import FileIO\n", "io = FileIO()" ] }, { "cell_type": "code", "execution_count": 83, "metadata": {}, "outputs": [ { "data": { "text/plain": [ "('AMZN_Moodys_CreditRating_2023.pdf',\n", " \"Exhibit 1\\nAmazon's debt has continued to rise as operating income remains below 2019\\n$0$20,000$40,000$60,000$80,000$100,000$120,000$140,000$160,000$180,000\\n$0$5,000$10,000$15,000$20,000$25,000$30,000\\n2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1 -23 LTM\\nMoody's Adjusted Debt (USD Millions)Moody's Adj. Operating Income (USD Millions)Moody's adjusted operating income Moody's adjusted debt\\nDebt includes lease\\nSource: Moody’s Financial Metrics™\",\n", " [-0.01308224257081747,\n", " 0.06867944449186325,\n", " -0.020469442009925842,\n", " -0.0013825400965288281,\n", " 0.03702259436249733,\n", " 0.034121669828891754,\n", " 0.022126320749521255,\n", " -0.0070864795707166195,\n", " -0.010557292960584164,\n", " -0.06593254953622818,\n", " -0.017468953505158424,\n", " 0.06061680242419243,\n", " 0.029126448556780815,\n", " -0.005478510633111,\n", " -0.02594311349093914,\n", " 0.028809983283281326,\n", " -0.002178516471758485,\n", " 0.0039460924454033375,\n", " -0.02270846627652645,\n", " 0.006046907044947147,\n", " -0.012309784069657326,\n", " 0.0390404537320137,\n", " -0.037603527307510376,\n", " -0.08567654341459274,\n", " -0.013738332316279411,\n", " -0.04620838537812233,\n", " 0.016511132940649986,\n", " -0.031025303527712822,\n", " -0.007453782483935356,\n", " -0.03461385890841484,\n", " 0.02483849599957466,\n", " -0.03287719190120697,\n", " 0.0067562805488705635,\n", " 0.0030197380110621452,\n", " 2.0404652332217665e-06,\n", " -0.04999164864420891,\n", " -0.025918828323483467,\n", " -0.007470090873539448,\n", " -0.006548367440700531,\n", " 0.02519342675805092,\n", " -0.021339574828743935,\n", " 0.05645693093538284,\n", " 0.018452810123562813,\n", " 0.008150491863489151,\n", " -0.0541897676885128,\n", " -0.0519619844853878,\n", " 0.022902552038431168,\n", " -0.012008707039058208,\n", " -0.03735215961933136,\n", " -0.012772235088050365,\n", " 0.02429082803428173,\n", " -0.006145351100713015,\n", " -0.03800635039806366,\n", " 0.010477244853973389,\n", " -0.02662668004631996,\n", " -0.02602367103099823,\n", " -0.018740132451057434,\n", " 0.07967119663953781,\n", " -0.03508136793971062,\n", " -0.10656490176916122,\n", " -0.046704668551683426,\n", " 0.05389600619673729,\n", " 0.04695991426706314,\n", " 0.006103063002228737,\n", " 0.016689825803041458,\n", " 0.04402385652065277,\n", " 0.058442384004592896,\n", " 0.012869670055806637,\n", " 0.00491133751347661,\n", " -0.05918630212545395,\n", " 0.11248376220464706,\n", " -0.02473456971347332,\n", " 0.021016191691160202,\n", " 0.033459361642599106,\n", " 0.0665128082036972,\n", " 0.021280353888869286,\n", " -0.016808316111564636,\n", " 0.008499220944941044,\n", " -0.004631344694644213,\n", " 0.007962984032928944,\n", " -0.04027734696865082,\n", " 0.028634488582611084,\n", " 0.0029515353962779045,\n", " 0.06288409233093262,\n", " -0.02907360903918743,\n", " -0.001318607246503234,\n", " -0.034678492695093155,\n", " -0.05325598269701004,\n", " -0.03175036609172821,\n", " -0.007120264694094658,\n", " 0.01574767380952835,\n", " -0.05257176235318184,\n", " 0.0652080550789833,\n", " -0.010084131732583046,\n", " 0.012218272313475609,\n", " 0.025144880637526512,\n", " -0.007697602733969688,\n", " -0.10863596946001053,\n", " -0.03066204860806465,\n", " 0.025341762229800224,\n", " -0.03371978551149368,\n", " -0.005859501659870148,\n", " -0.025777311995625496,\n", " 0.03485197573900223,\n", " -0.04193921759724617,\n", " 0.06987886130809784,\n", " -0.022705107927322388,\n", " -0.018788497895002365,\n", " -0.017456691712141037,\n", " 0.07253225892782211,\n", " 0.04590785130858421,\n", " -0.020422659814357758,\n", " -0.02094613015651703,\n", " 0.051027484238147736,\n", " -0.03536525368690491,\n", " -0.017603307962417603,\n", " 0.02043318562209606,\n", " -0.03324861451983452,\n", " -0.0107541773468256,\n", " -0.006979673635214567,\n", " -0.0011866915738210082,\n", " 0.03612186387181282,\n", " 0.03335602581501007,\n", " 0.0151100168004632,\n", " 0.0214882493019104,\n", " 0.025049153715372086,\n", " -0.04267726466059685,\n", " 0.023734988644719124,\n", " 0.01839207299053669,\n", " 0.05425473302602768,\n", " 0.05582093074917793,\n", " -0.006928520742803812,\n", " 0.03312622755765915,\n", " -0.045584406703710556,\n", " 0.05102703347802162,\n", " 0.019538212567567825,\n", " 0.007857217453420162,\n", " 0.0020144334994256496,\n", " 0.053219281136989594,\n", " 0.009430520236492157,\n", " 0.036261171102523804,\n", " 0.003019336611032486,\n", " -0.001977092120796442,\n", " 0.05089060217142105,\n", " 0.009086503647267818,\n", " 0.021353967487812042,\n", " 9.425330063095316e-05,\n", " 0.011253801174461842,\n", " -0.0068307905457913876,\n", " 0.031960565596818924,\n", " 0.018189342692494392,\n", " -0.013056086376309395,\n", " -0.09301381558179855,\n", " -0.046417515724897385,\n", " 0.017748406156897545,\n", " -0.002062513493001461,\n", " 0.04650171473622322,\n", " -0.08185800164937973,\n", " 0.10006366670131683,\n", " -0.03528377786278725,\n", " 0.023165104910731316,\n", " -0.013879305683076382,\n", " -0.04876210540533066,\n", " -0.019429268315434456,\n", " 0.014564701355993748,\n", " -0.040197793394327164,\n", " 0.06961726397275925,\n", " 0.023737037554383278,\n", " -0.09237590432167053,\n", " 0.01614752598106861,\n", " -0.008806060068309307,\n", " 0.017306679859757423,\n", " -0.009093695320189,\n", " -0.018711980432271957,\n", " 0.05061795189976692,\n", " -0.023642662912607193,\n", " -0.039230573922395706,\n", " 0.003890487365424633,\n", " -0.05532532557845116,\n", " 0.0025021543260663748,\n", " 0.008969810791313648,\n", " -0.051493365317583084,\n", " -0.033666908740997314,\n", " -0.011186704970896244,\n", " -0.04347839206457138,\n", " 0.06350927799940109,\n", " 0.012774813920259476,\n", " -0.026240946725010872,\n", " -0.008919754065573215,\n", " -0.02038840390741825,\n", " -0.04110979288816452,\n", " 0.018209965899586678,\n", " -0.023859210312366486,\n", " 0.008659716695547104,\n", " -0.0019189313752576709,\n", " 0.011926941573619843,\n", " -0.024060718715190887,\n", " 0.048407234251499176,\n", " 0.024435268715023994,\n", " 0.023593975231051445,\n", " -0.004982301965355873,\n", " -0.018575936555862427,\n", " 0.06306687742471695,\n", " -0.028822891414165497,\n", " 0.030392218381166458,\n", " -0.007450514007359743,\n", " -0.01884414628148079,\n", " -0.020359225571155548,\n", " -0.012177831493318081,\n", " 0.016463812440633774,\n", " -0.00272407871671021,\n", " 0.032313283532857895,\n", " -0.04779098555445671,\n", " -0.009837822988629341,\n", " 0.015233974903821945,\n", " 0.00963843334466219,\n", " 0.002747311256825924,\n", " 0.0009132946725003421,\n", " -0.05895650014281273,\n", " -0.010695886798202991,\n", " 0.011464503593742847,\n", " -0.06561686843633652,\n", " 0.00201627635397017,\n", " 0.021136824041604996,\n", " -0.02472318522632122,\n", " 0.05069324001669884,\n", " 0.008313572034239769,\n", " 0.004568143282085657,\n", " -0.004179926589131355,\n", " 0.024203458800911903,\n", " 0.020260140299797058,\n", " 0.007112598977982998,\n", " 0.003392013953998685,\n", " 0.04507003724575043,\n", " -0.008543478325009346,\n", " 0.04617184028029442,\n", " 0.04179571568965912,\n", " 0.07836145907640457,\n", " 0.035250574350357056,\n", " 0.0515415295958519,\n", " -0.010527662001550198,\n", " -0.004801169503480196,\n", " 0.037770096212625504,\n", " 0.02449776977300644,\n", " -0.0046393368393182755,\n", " -0.016189340502023697,\n", " 0.042761530727148056,\n", " 0.008905679918825626,\n", " -0.021380705758929253,\n", " 0.04247669875621796,\n", " 0.02348916605114937,\n", " 0.0543062761425972,\n", " 0.03237362951040268,\n", " -0.003939305432140827,\n", " 0.023533135652542114,\n", " -0.05834921821951866,\n", " 0.009055919013917446,\n", " -0.024253077805042267,\n", " 0.0610181987285614,\n", " 0.017638007178902626,\n", " -0.049365464597940445,\n", " -0.0598268061876297,\n", " -0.0026936307549476624,\n", " -0.02001534402370453,\n", " -0.0038575055077672005,\n", " -0.025547469034790993,\n", " 0.08070965111255646,\n", " 0.036665722727775574,\n", " -0.0028340087737888098,\n", " 0.0057832165621221066,\n", " 0.007785819936543703,\n", " -0.017881328240036964,\n", " -0.03132257238030434,\n", " -0.028281254693865776,\n", " 0.043969228863716125,\n", " 0.03851235657930374,\n", " -0.009476903825998306,\n", " 0.00801691971719265,\n", " 0.006809771526604891,\n", " 0.0037825172767043114,\n", " 0.04454656317830086,\n", " -0.05762482061982155,\n", " 0.00843021646142006,\n", " -0.005200414918363094,\n", " -0.01994931325316429,\n", " 0.0027047027833759785,\n", " 0.04045019671320915,\n", " -0.07031668722629547,\n", " -0.000185063763638027,\n", " 0.07484462857246399,\n", " -0.027430657297372818,\n", " -0.03510013222694397,\n", " 0.010141516104340553,\n", " 0.01578907109797001,\n", " 0.017327677458524704,\n", " -0.02270321734249592,\n", " -0.02189689688384533,\n", " -0.010043150745332241,\n", " 0.009166408330202103,\n", " 0.03116000071167946,\n", " -0.040931109338998795,\n", " -0.045800525695085526,\n", " 0.0339280441403389,\n", " 0.016933435574173927,\n", " 0.021932298317551613,\n", " 0.04139295592904091,\n", " 0.06423763185739517,\n", " 0.02958017773926258,\n", " 0.01160203292965889,\n", " 0.004214542452245951,\n", " -0.0131885576993227,\n", " -0.004608359653502703,\n", " 0.012094379402697086,\n", " -0.01025528833270073,\n", " 0.02769654244184494,\n", " -0.09118320792913437,\n", " 0.0005799960345029831,\n", " 0.06794080138206482,\n", " -0.052565451711416245,\n", " 0.08112438023090363,\n", " 0.055929917842149734,\n", " -0.024980492889881134,\n", " -0.008176114410161972,\n", " -0.022463083267211914,\n", " 0.02638125978410244,\n", " 0.01588583178818226,\n", " 0.05340654030442238,\n", " 0.037381611764431,\n", " -0.013845314271748066,\n", " -0.03886852040886879,\n", " 0.007830195128917694,\n", " 0.008651641197502613,\n", " -0.04062123969197273,\n", " 0.051850996911525726,\n", " 0.023500150069594383,\n", " 0.038698989897966385,\n", " 0.013046261854469776,\n", " 0.0102417953312397,\n", " 0.05110432952642441,\n", " -0.006298325955867767,\n", " 0.016633115708827972,\n", " 0.013816612772643566,\n", " 0.031919028609991074,\n", " 0.0074382079765200615,\n", " 0.02180156670510769,\n", " -0.013062913902103901,\n", " -0.00410612765699625,\n", " -0.008196964859962463,\n", " -0.07937474548816681,\n", " -0.023287329822778702,\n", " -0.01245852280408144,\n", " -0.052027735859155655,\n", " -0.03308119997382164,\n", " 0.016473310068249702,\n", " -0.0002727355749811977,\n", " -0.010680193081498146,\n", " -0.04643271490931511,\n", " 0.02704627625644207,\n", " 0.048820871859788895,\n", " -0.061184003949165344,\n", " -0.0528457835316658,\n", " -0.010502127930521965,\n", " 0.003519992111250758,\n", " 0.024147147312760353,\n", " 0.009485983289778233,\n", " 0.0014688054798170924,\n", " -0.020464126020669937,\n", " 0.04789063334465027,\n", " -0.014647325500845909,\n", " 0.015671268105506897,\n", " -0.10157816857099533,\n", " -0.019060108810663223,\n", " -0.027379723265767097,\n", " -0.028313148766756058,\n", " 0.036765966564416885,\n", " 0.02546647936105728,\n", " 0.04592754691839218,\n", " -0.0073290555737912655,\n", " -0.0007797894068062305,\n", " 0.0032454885076731443,\n", " 0.0361962728202343,\n", " -0.07136683911085129,\n", " 0.03708973154425621,\n", " -0.007206316106021404,\n", " 0.0034306556917726994,\n", " 0.05525042116641998,\n", " -0.06281211227178574,\n", " -0.05409620702266693,\n", " -0.059511590749025345,\n", " -0.05761099234223366,\n", " -0.042449649423360825,\n", " 0.051975831389427185,\n", " 0.02161945402622223,\n", " 0.019384723156690598,\n", " 0.008938628248870373,\n", " -0.014956844970583916,\n", " -0.03070489503443241,\n", " -0.015302647836506367,\n", " 0.01653970591723919,\n", " 0.029028762131929398,\n", " -0.0006838259869255126,\n", " -0.047457560896873474,\n", " 0.03809754177927971,\n", " -0.011511856690049171,\n", " -0.007400183007121086,\n", " -0.06333193928003311,\n", " -0.004013512283563614,\n", " 0.03164494410157204,\n", " -0.07239235937595367,\n", " 0.0972558781504631,\n", " -0.019368352368474007,\n", " 0.029579931870102882,\n", " -0.00822599045932293,\n", " -0.005697658285498619,\n", " 0.03989040479063988,\n", " -0.01615680567920208,\n", " -0.014459951780736446,\n", " 0.007050076499581337,\n", " 0.0004058550111949444,\n", " -0.04373619332909584,\n", " -0.012694897130131721,\n", " -0.011115497909486294,\n", " -0.010048898868262768,\n", " 0.0413396917283535,\n", " 0.009149848483502865,\n", " 0.06540165096521378,\n", " 0.010887800715863705,\n", " -0.06412246078252792,\n", " -0.033250823616981506,\n", " -0.05180298164486885,\n", " 0.015673162415623665,\n", " -0.00625696312636137,\n", " -0.08522641658782959,\n", " -0.05301392450928688,\n", " -0.13734768331050873,\n", " 0.12871065735816956,\n", " -0.006552192848175764,\n", " -0.017367534339427948,\n", " 0.047180283814668655,\n", " -0.012312543578445911,\n", " -0.0720340684056282,\n", " -0.0008652015822008252,\n", " 0.018500981852412224,\n", " 0.03632459044456482,\n", " -0.04014566168189049,\n", " 0.015644598752260208,\n", " 0.022664764896035194,\n", " 0.031592484563589096,\n", " -0.1128736212849617,\n", " 0.00925243366509676,\n", " 0.026888567954301834,\n", " -0.02127787098288536,\n", " 0.03658483549952507,\n", " -0.028869982808828354,\n", " 0.013704805634915829,\n", " -0.02923252433538437,\n", " -0.04360055923461914,\n", " -0.05719120800495148,\n", " 0.01913757435977459,\n", " 0.020491037517786026,\n", " 0.01488889753818512,\n", " 0.008192257024347782,\n", " -0.043389592319726944,\n", " 0.03261711075901985,\n", " 0.01772722415626049,\n", " 0.005744822323322296,\n", " 0.0837014690041542,\n", " -0.033662568777799606,\n", " -0.013399815186858177,\n", " -0.003961120266467333,\n", " -0.011953609064221382,\n", " -0.0009173261350952089,\n", " 0.006700105033814907,\n", " 0.02207682654261589,\n", " -0.035968489944934845,\n", " -0.0008805737597867846,\n", " 0.022872954607009888,\n", " -0.0301370769739151,\n", " 0.02247629128396511,\n", " 0.0036621990147978067,\n", " -0.009547416120767593,\n", " -0.03295712545514107,\n", " 0.0039816563948988914,\n", " -0.08857874572277069,\n", " -0.03091561049222946,\n", " 0.0013689756160601974,\n", " 0.03268645703792572,\n", " 0.003998999018222094,\n", " 0.01146518811583519,\n", " -0.01724652387201786,\n", " 0.002289109630510211,\n", " 0.02031240612268448,\n", " 0.010694341734051704,\n", " 0.14328989386558533,\n", " 0.052055150270462036,\n", " -0.024659261107444763,\n", " -1.027342295856215e-05,\n", " 0.0015873139491304755,\n", " -0.004300323780626059,\n", " -0.02244020253419876,\n", " 0.00029828885453753173,\n", " -0.01093694381415844,\n", " 0.0250303465873003,\n", " -0.006072158459573984,\n", " 0.01802871562540531,\n", " 0.03464493155479431,\n", " 0.011286282911896706,\n", " 0.0490318164229393,\n", " 0.032330743968486786,\n", " 0.037675417959690094,\n", " -0.045931313186883926,\n", " 0.026120448485016823,\n", " 0.04733739420771599,\n", " 0.05305413529276848,\n", " 0.0414576530456543,\n", " 0.005016283597797155,\n", " -0.05437881499528885,\n", " -0.013247841969132423,\n", " 0.018742511048913002,\n", " -0.026493432000279427,\n", " -0.010483450256288052,\n", " 0.012297974899411201,\n", " 0.005523649509996176,\n", " 0.010960920713841915,\n", " 0.0129507165402174,\n", " 0.002119106240570545,\n", " -0.004457532428205013,\n", " -0.03026401624083519,\n", " 0.0569324865937233,\n", " 0.007996520958840847,\n", " 0.031323425471782684,\n", " -0.02617904171347618,\n", " -0.032085515558719635,\n", " 0.043570831418037415,\n", " 0.007157137151807547,\n", " 0.016949549317359924,\n", " 0.01581173576414585,\n", " -0.06025216728448868,\n", " 0.05296485498547554,\n", " 0.007883313111960888,\n", " 0.025403982028365135,\n", " -0.01864006742835045,\n", " 0.0020312925335019827,\n", " -0.03477361798286438,\n", " 0.021074632182717323,\n", " -0.0674167275428772,\n", " -0.023957377299666405,\n", " -0.002644499996677041,\n", " 0.03929757699370384,\n", " 0.03684346377849579,\n", " 0.03206155076622963,\n", " 0.002253426006063819,\n", " -0.10118954628705978,\n", " 0.010977108031511307,\n", " -0.02793887071311474,\n", " -5.4156920227023486e-33,\n", " 0.007499550469219685,\n", " -0.06364785879850388,\n", " 0.007029827684164047,\n", " -0.02908353880047798,\n", " 0.009454210288822651,\n", " 0.061561182141304016,\n", " -0.016438400372862816,\n", " -0.006387440953403711,\n", " -0.0545242503285408,\n", " 0.02694222889840603,\n", " -0.046102605760097504,\n", " 0.017801402136683464,\n", " 0.019225886091589928,\n", " -0.0024245509412139654,\n", " -0.018289612606167793,\n", " -0.006866226904094219,\n", " -0.042299266904592514,\n", " -0.025749726220965385,\n", " -0.013466283679008484,\n", " -0.010382038541138172,\n", " 0.0049272761680185795,\n", " 0.0385194756090641,\n", " 0.06273624300956726,\n", " -0.05697569623589516,\n", " 0.010258786380290985,\n", " 0.001029115985147655,\n", " -0.042554982006549835,\n", " -0.027835076674818993,\n", " -0.006369148846715689,\n", " 0.02743649110198021,\n", " -0.03155330568552017,\n", " 0.0036524184979498386,\n", " -0.020946046337485313,\n", " -0.041322868317365646,\n", " -0.018714245408773422,\n", " -0.0515606515109539,\n", " 0.03199503570795059,\n", " -0.011261338368058205,\n", " 0.037098973989486694,\n", " -0.006615171674638987,\n", " -0.011546265333890915,\n", " 0.004369532223790884,\n", " 0.010049615055322647,\n", " 0.05726569890975952,\n", " -0.0019820474553853273,\n", " -0.07401710748672485,\n", " -0.016334332525730133,\n", " -0.044905904680490494,\n", " 0.011928140185773373,\n", " -0.05825340002775192,\n", " 0.01222989521920681,\n", " 0.007869466207921505,\n", " -0.024600865319371223,\n", " 0.028915634378790855,\n", " 0.0017175596440210938,\n", " 0.09296761453151703,\n", " -0.024881044402718544,\n", " 0.046091556549072266,\n", " -0.046633847057819366,\n", " 0.002947345608845353,\n", " -0.016416285187005997,\n", " 0.03343819081783295,\n", " 0.026420194655656815,\n", " -0.04303514584898949,\n", " -0.00699209189042449,\n", " -0.0036818727385252714,\n", " -0.05317777767777443,\n", " -0.04002470150589943,\n", " 0.004660594277083874,\n", " 0.03914570063352585,\n", " -0.00029103909037075937,\n", " 0.011533229611814022,\n", " -0.006666777655482292,\n", " -0.03239773213863373,\n", " 0.008558784611523151,\n", " 0.04535096138715744,\n", " 0.015078919939696789,\n", " 0.007027104031294584,\n", " 0.007339711766690016,\n", " 0.06032974272966385,\n", " 0.031156502664089203,\n", " -0.039147693663835526,\n", " -0.010153393261134624,\n", " 0.010847359895706177,\n", " 0.04162780940532684,\n", " -0.11003303527832031,\n", " -0.009496986865997314,\n", " -0.013572659343481064,\n", " -0.0006741267279721797,\n", " -0.04419838264584541,\n", " -0.0055521330796182156,\n", " 0.030568338930606842,\n", " 0.0056192935444414616,\n", " 0.0010102038504555821,\n", " -0.13539350032806396,\n", " 0.014016886241734028,\n", " -0.015292491763830185,\n", " -0.0002531220961827785,\n", " -0.012414133176207542,\n", " -0.02468063309788704,\n", " 0.0355592742562294,\n", " 0.013000431470572948,\n", " -0.028598401695489883,\n", " 0.04109707847237587,\n", " 0.031440746039152145,\n", " 0.005513492040336132,\n", " 0.046419307589530945,\n", " -0.009285454638302326,\n", " 0.0013993183383718133,\n", " 0.005027181934565306,\n", " 0.05468497797846794,\n", " -0.008887208066880703,\n", " 0.05949392914772034,\n", " 0.03060164861381054,\n", " -0.025527996942400932,\n", " 0.018063751980662346,\n", " 0.02401670254766941,\n", " 0.056001175194978714,\n", " 0.03923417627811432,\n", " -0.009208012372255325,\n", " -0.02507474645972252,\n", " 0.011202679015696049,\n", " -0.04157780855894089,\n", " -0.004708271939307451,\n", " -0.02212175354361534,\n", " 0.004319815430790186,\n", " -0.009838607162237167,\n", " -0.016427816823124886,\n", " -0.003646827070042491,\n", " -0.08618132770061493,\n", " -0.0032221139408648014,\n", " 0.04036574810743332,\n", " 2.688785230020585e-07,\n", " 0.01613558828830719,\n", " 0.020397169515490532,\n", " -0.013199969194829464,\n", " 0.013668113388121128,\n", " -0.0336480587720871,\n", " 0.03158066049218178,\n", " 0.00015078285650815815,\n", " -0.005043643992394209,\n", " 0.007240443956106901,\n", " -0.016732769086956978,\n", " -0.01778222620487213,\n", " -0.006319006904959679,\n", " 0.0026477735955268145,\n", " 0.05096590891480446,\n", " 0.000314899516524747,\n", " -0.07434584945440292,\n", " -0.07040613144636154,\n", " -0.03440011665225029,\n", " -0.05675767734646797,\n", " 0.005714419297873974,\n", " -0.004738857038319111,\n", " 0.027643248438835144,\n", " 0.03015892393887043,\n", " -0.021467536687850952,\n", " -0.01804901659488678,\n", " -0.06000987067818642,\n", " -0.03163277357816696,\n", " -0.03434927761554718,\n", " -0.024609973654150963,\n", " 0.0014343135990202427,\n", " -0.004159199073910713,\n", " -0.014878405258059502,\n", " -0.022492757067084312,\n", " -0.06062024459242821,\n", " -0.03563354164361954,\n", " 0.015328079462051392,\n", " -0.0030022715218365192,\n", " -0.0321667417883873,\n", " 0.03232646360993385,\n", " 0.05049058422446251,\n", " 0.041420042514801025,\n", " -0.002443856792524457,\n", " 0.003920216578990221,\n", " -0.0072942012920975685,\n", " 0.014919500797986984,\n", " 0.031007057055830956,\n", " -0.01605202443897724,\n", " 0.018757320940494537,\n", " 0.016321493312716484,\n", " 0.017621828243136406,\n", " -0.028842749074101448,\n", " -0.01334365177899599,\n", " -0.0716673955321312,\n", " 0.012919843196868896,\n", " 0.00961886253207922,\n", " -0.020680168643593788,\n", " 0.008874869905412197,\n", " -0.022488757967948914,\n", " 0.03880728781223297,\n", " 0.02864018641412258,\n", " -0.04065806791186333,\n", " 0.057541459798812866,\n", " -0.03819567710161209,\n", " 0.08125234395265579,\n", " 0.016827315092086792,\n", " 0.06671390682458878,\n", " -0.0025501109194010496,\n", " 2.0432734383693303e-34,\n", " -0.007288863882422447,\n", " -0.058341026306152344,\n", " 0.025634951889514923,\n", " 0.008757147006690502,\n", " 0.020765822380781174,\n", " -0.03153693303465843,\n", " 0.0015858758706599474,\n", " 0.007262093015015125,\n", " -0.06400582939386368,\n", " -0.054418858140707016,\n", " -0.04431282356381416])" ] }, "execution_count": 83, "metadata": {}, "output_type": "execute_result" } ], "source": [ "text_vector_tuples = [(fname, split, emb.tolist()) for fname, splits_emb in content_embeddings.items() for split, emb in splits_emb]\n", "\n", "pfile = os.path.join(datadir, 'text_vectors.parquet')\n", "text_vector_tuples[2]" ] }, { "cell_type": "code", "execution_count": 93, "metadata": {}, "outputs": [], "source": [ "pd.DataFrame(text_vector_tuples, columns=['file', 'content', 'content_embedding']).to_parquet(pfile, index=False)" ] }, { "cell_type": "code", "execution_count": 94, "metadata": {}, "outputs": [ { "data": { "text/html": [ "
\n", "\n", "\n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", " \n", "
filecontentcontent_embedding
0AMZN_Moodys_CreditRating_2023.pdfCORPORATES\\nCREDIT OPINION\\n23 May 2023\\nUpdat...[-0.009635023772716522, 0.01748381368815899, -...
1AMZN_Moodys_CreditRating_2023.pdfThe company is reliant\\non the operating incom...[0.0033761824015527964, 0.026259412989020348, ...
2AMZN_Moodys_CreditRating_2023.pdfExhibit 1\\nAmazon's debt has continued to rise...[-0.01308224257081747, 0.06867944449186325, -0...
3AMZN_Moodys_CreditRating_2023.pdfMOODY'S INVESTORS SERVICE CORPORATES\\nCredit s...[-0.009228247217833996, 0.023773541674017906, ...
4AMZN_Moodys_CreditRating_2023.pdfFactors that could lead to a downgrade\\nRating...[-0.027790367603302002, 0.01033176202327013, -...
5AMZN_Moodys_CreditRating_2023.pdfMOODY'S INVESTORS SERVICE CORPORATES\\nKey indi...[0.003038279013708234, 0.024112433195114136, -...
6AMZN_Moodys_CreditRating_2023.pdfPeriods are Financial Year-End unless indicate...[-0.02161526307463646, 0.017826249822974205, -...
7AMZN_Moodys_CreditRating_2023.pdf541 $22,899 $24,879 \\n$12,248 \\n$13,353 \\n $(1...[-0.019557256251573563, 0.046015415340662, -0....
8AMZN_Moodys_CreditRating_2023.pdfRevenue growth in Q1 2023 has decelerated to 1...[0.017024273052811623, 0.09144710004329681, -0...
9AMZN_Moodys_CreditRating_2023.pdfOperating margin expansion for AWS could be ch...[-0.0007624945719726384, 0.019459251314401627,...
10AMZN_Moodys_CreditRating_2023.pdfMOODY'S INVESTORS SERVICE CORPORATES\\nOnline r...[-0.012922010384500027, -0.008826124481856823,...
11AMZN_Moodys_CreditRating_2023.pdfTo combat these growing competitive threats, A...[0.022352447733283043, 0.03581862524151802, -0...
12AMZN_Moodys_CreditRating_2023.pdfPhysical store sales remain primarily from Who...[0.01748734898865223, 0.048514027148485184, -0...
13AMZN_Moodys_CreditRating_2023.pdfCost pressures are being addressed as investme...[-0.016115665435791016, 0.019384682178497314, ...
14AMZN_Moodys_CreditRating_2023.pdfNonetheless, cost structure improvements have ...[0.026285609230399132, 0.06849091500043869, -0...
15AMZN_Moodys_CreditRating_2023.pdfMOODY'S INVESTORS SERVICE CORPORATES\\ncontent ...[0.032340969890356064, 0.06449572741985321, -0...
16AMZN_Moodys_CreditRating_2023.pdfOur estimates assumes that free cash flow is p...[0.001195229939185083, 0.017198598012328148, -...
17AMZN_Moodys_CreditRating_2023.pdf's ESG Credit Impact Score is Neutral-to-Low C...[-0.03523287922143936, -0.0531902089715004, -0...
18AMZN_Moodys_CreditRating_2023.pdfMOODY'S INVESTORS SERVICE CORPORATES\\nExhibit ...[-0.014425626024603844, -0.03764912113547325, ...
19AMZN_Moodys_CreditRating_2023.pdfIts business diversification with AWS and its ...[0.023667210713028908, -0.04227706417441368, -...
20AMZN_Moodys_CreditRating_2023.pdfThe use of proceeds were for general corporate...[0.015116244554519653, 0.02225925773382187, -0...
21AMZN_Moodys_CreditRating_2023.pdf6 23 May 2023 Amazon.com, Inc.: Updat...[0.0012155260192230344, 0.0697660744190216, -0...
22AMZN_Moodys_CreditRating_2023.pdfMOODY'S INVESTORS SERVICE CORPORATES\\nRating m...[-0.023705003783106804, -0.03370162099599838, ...
23AMZN_Moodys_CreditRating_2023.pdf6x Ba 2.4x A\\nFactor 4 : Financial Policy (15%...[-0.006757335737347603, -0.02712010219693184, ...
24AMZN_Moodys_CreditRating_2023.pdfMOODY'S INVESTORS SERVICE CORPORATES\\n \\nRatin...[-0.010837461799383163, -0.006436419207602739,...
25AMZN_Moodys_CreditRating_2023.pdfMOODY'S INVESTORS SERVICE CORPORATES\\nAppendix...[-0.000930506328586489, 0.03842345252633095, -...
26AMZN_Moodys_CreditRating_2023.pdfAll figures are calculated using Moody’s estim...[-0.034074392169713974, 0.004323272034525871, ...
27AMZN_Moodys_CreditRating_2023.pdfAll figures are calculated using Moody’s estim...[-0.0037285625003278255, 0.042170990258455276,...
28AMZN_Moodys_CreditRating_2023.pdf493 $19,363 $19,268 $19,314\\nTotal Debt $133,0...[-0.027293503284454346, -0.018978072330355644,...
29AMZN_Moodys_CreditRating_2023.pdf6x 2.8x 2.9x 7.4x 9.5x 8.3x 93.9x 84.1x 82.4x ...[-0.006772964261472225, -0.015409987419843674,...
30AMZN_Moodys_CreditRating_2023.pdf5%\\nFCF / Debt -19.5% -15.4% -8.9% 26.2% 6.9% ...[-0.005357947666198015, 0.016027746722102165, ...
31AMZN_Moodys_CreditRating_2023.pdfMOODY'S INVESTORS SERVICE CORPORATES\\n© 2023 M...[-0.01173881720751524, -0.03800323233008385, -...
32AMZN_Moodys_CreditRating_2023.pdfCREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, ...[-0.03346630930900574, 0.020460220053792, -0.0...
33AMZN_Moodys_CreditRating_2023.pdfMOODY’S CREDIT\\nRATINGS, ASSESSMENTS, OTHER OP...[-0.01372881606221199, 0.04676871374249458, -0...
34AMZN_Moodys_CreditRating_2023.pdfALL INFORMATION CONTAINED HEREIN IS PROTECTED ...[-0.03205938637256622, 0.0024826570879667997, ...
35AMZN_Moodys_CreditRating_2023.pdfMOODY'S adopts all necessary measures so that ...[0.013667544350028038, 0.037819087505340576, -...
36AMZN_Moodys_CreditRating_2023.pdfTo the extent permitted by law, MOODY’S and it...[0.008692814968526363, 0.04825408011674881, -0...
37AMZN_Moodys_CreditRating_2023.pdfMoody’s Investors Service, Inc., a wholly-owne...[0.03911886364221573, -0.0013522494118660688, ...
38AMZN_Moodys_CreditRating_2023.pdfand have also\\npublicly reported to the SEC an...[0.02589792013168335, -0.006817953661084175, 0...
39AMZN_Moodys_CreditRating_2023.pdfMOODY’S credit rating is an opinion as to\\nthe...[0.059145040810108185, -0.02710546925663948, 0...
40AMZN_Moodys_CreditRating_2023.pdf2 and 3 respectively.\\nMJKK or MSFJ (as applic...[0.049356915056705475, -0.021680600941181183, ...
\n", "
" ], "text/plain": [ " file \\\n", "0 AMZN_Moodys_CreditRating_2023.pdf \n", "1 AMZN_Moodys_CreditRating_2023.pdf \n", "2 AMZN_Moodys_CreditRating_2023.pdf \n", "3 AMZN_Moodys_CreditRating_2023.pdf \n", "4 AMZN_Moodys_CreditRating_2023.pdf \n", "5 AMZN_Moodys_CreditRating_2023.pdf \n", "6 AMZN_Moodys_CreditRating_2023.pdf \n", "7 AMZN_Moodys_CreditRating_2023.pdf \n", "8 AMZN_Moodys_CreditRating_2023.pdf \n", "9 AMZN_Moodys_CreditRating_2023.pdf \n", "10 AMZN_Moodys_CreditRating_2023.pdf \n", "11 AMZN_Moodys_CreditRating_2023.pdf \n", "12 AMZN_Moodys_CreditRating_2023.pdf \n", "13 AMZN_Moodys_CreditRating_2023.pdf \n", "14 AMZN_Moodys_CreditRating_2023.pdf \n", "15 AMZN_Moodys_CreditRating_2023.pdf \n", "16 AMZN_Moodys_CreditRating_2023.pdf \n", "17 AMZN_Moodys_CreditRating_2023.pdf \n", "18 AMZN_Moodys_CreditRating_2023.pdf \n", "19 AMZN_Moodys_CreditRating_2023.pdf \n", "20 AMZN_Moodys_CreditRating_2023.pdf \n", "21 AMZN_Moodys_CreditRating_2023.pdf \n", "22 AMZN_Moodys_CreditRating_2023.pdf \n", "23 AMZN_Moodys_CreditRating_2023.pdf \n", "24 AMZN_Moodys_CreditRating_2023.pdf \n", "25 AMZN_Moodys_CreditRating_2023.pdf \n", "26 AMZN_Moodys_CreditRating_2023.pdf \n", "27 AMZN_Moodys_CreditRating_2023.pdf \n", "28 AMZN_Moodys_CreditRating_2023.pdf \n", "29 AMZN_Moodys_CreditRating_2023.pdf \n", "30 AMZN_Moodys_CreditRating_2023.pdf \n", "31 AMZN_Moodys_CreditRating_2023.pdf \n", "32 AMZN_Moodys_CreditRating_2023.pdf \n", "33 AMZN_Moodys_CreditRating_2023.pdf \n", "34 AMZN_Moodys_CreditRating_2023.pdf \n", "35 AMZN_Moodys_CreditRating_2023.pdf \n", "36 AMZN_Moodys_CreditRating_2023.pdf \n", "37 AMZN_Moodys_CreditRating_2023.pdf \n", "38 AMZN_Moodys_CreditRating_2023.pdf \n", "39 AMZN_Moodys_CreditRating_2023.pdf \n", "40 AMZN_Moodys_CreditRating_2023.pdf \n", "\n", " content \\\n", "0 CORPORATES\\nCREDIT OPINION\\n23 May 2023\\nUpdat... \n", "1 The company is reliant\\non the operating incom... \n", "2 Exhibit 1\\nAmazon's debt has continued to rise... \n", "3 MOODY'S INVESTORS SERVICE CORPORATES\\nCredit s... \n", "4 Factors that could lead to a downgrade\\nRating... \n", "5 MOODY'S INVESTORS SERVICE CORPORATES\\nKey indi... \n", "6 Periods are Financial Year-End unless indicate... \n", "7 541 $22,899 $24,879 \\n$12,248 \\n$13,353 \\n $(1... \n", "8 Revenue growth in Q1 2023 has decelerated to 1... \n", "9 Operating margin expansion for AWS could be ch... \n", "10 MOODY'S INVESTORS SERVICE CORPORATES\\nOnline r... \n", "11 To combat these growing competitive threats, A... \n", "12 Physical store sales remain primarily from Who... \n", "13 Cost pressures are being addressed as investme... \n", "14 Nonetheless, cost structure improvements have ... \n", "15 MOODY'S INVESTORS SERVICE CORPORATES\\ncontent ... \n", "16 Our estimates assumes that free cash flow is p... \n", "17 's ESG Credit Impact Score is Neutral-to-Low C... \n", "18 MOODY'S INVESTORS SERVICE CORPORATES\\nExhibit ... \n", "19 Its business diversification with AWS and its ... \n", "20 The use of proceeds were for general corporate... \n", "21 6 23 May 2023 Amazon.com, Inc.: Updat... \n", "22 MOODY'S INVESTORS SERVICE CORPORATES\\nRating m... \n", "23 6x Ba 2.4x A\\nFactor 4 : Financial Policy (15%... \n", "24 MOODY'S INVESTORS SERVICE CORPORATES\\n \\nRatin... \n", "25 MOODY'S INVESTORS SERVICE CORPORATES\\nAppendix... \n", "26 All figures are calculated using Moody’s estim... \n", "27 All figures are calculated using Moody’s estim... \n", "28 493 $19,363 $19,268 $19,314\\nTotal Debt $133,0... \n", "29 6x 2.8x 2.9x 7.4x 9.5x 8.3x 93.9x 84.1x 82.4x ... \n", "30 5%\\nFCF / Debt -19.5% -15.4% -8.9% 26.2% 6.9% ... \n", "31 MOODY'S INVESTORS SERVICE CORPORATES\\n© 2023 M... \n", "32 CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, ... \n", "33 MOODY’S CREDIT\\nRATINGS, ASSESSMENTS, OTHER OP... \n", "34 ALL INFORMATION CONTAINED HEREIN IS PROTECTED ... \n", "35 MOODY'S adopts all necessary measures so that ... \n", "36 To the extent permitted by law, MOODY’S and it... \n", "37 Moody’s Investors Service, Inc., a wholly-owne... \n", "38 and have also\\npublicly reported to the SEC an... \n", "39 MOODY’S credit rating is an opinion as to\\nthe... \n", "40 2 and 3 respectively.\\nMJKK or MSFJ (as applic... \n", "\n", " content_embedding \n", "0 [-0.009635023772716522, 0.01748381368815899, -... \n", "1 [0.0033761824015527964, 0.026259412989020348, ... \n", "2 [-0.01308224257081747, 0.06867944449186325, -0... \n", "3 [-0.009228247217833996, 0.023773541674017906, ... \n", "4 [-0.027790367603302002, 0.01033176202327013, -... \n", "5 [0.003038279013708234, 0.024112433195114136, -... \n", "6 [-0.02161526307463646, 0.017826249822974205, -... \n", "7 [-0.019557256251573563, 0.046015415340662, -0.... \n", "8 [0.017024273052811623, 0.09144710004329681, -0... \n", "9 [-0.0007624945719726384, 0.019459251314401627,... \n", "10 [-0.012922010384500027, -0.008826124481856823,... \n", "11 [0.022352447733283043, 0.03581862524151802, -0... \n", "12 [0.01748734898865223, 0.048514027148485184, -0... \n", "13 [-0.016115665435791016, 0.019384682178497314, ... \n", "14 [0.026285609230399132, 0.06849091500043869, -0... \n", "15 [0.032340969890356064, 0.06449572741985321, -0... \n", "16 [0.001195229939185083, 0.017198598012328148, -... \n", "17 [-0.03523287922143936, -0.0531902089715004, -0... \n", "18 [-0.014425626024603844, -0.03764912113547325, ... \n", "19 [0.023667210713028908, -0.04227706417441368, -... \n", "20 [0.015116244554519653, 0.02225925773382187, -0... \n", "21 [0.0012155260192230344, 0.0697660744190216, -0... \n", "22 [-0.023705003783106804, -0.03370162099599838, ... \n", "23 [-0.006757335737347603, -0.02712010219693184, ... \n", "24 [-0.010837461799383163, -0.006436419207602739,... \n", "25 [-0.000930506328586489, 0.03842345252633095, -... \n", "26 [-0.034074392169713974, 0.004323272034525871, ... \n", "27 [-0.0037285625003278255, 0.042170990258455276,... \n", "28 [-0.027293503284454346, -0.018978072330355644,... \n", "29 [-0.006772964261472225, -0.015409987419843674,... \n", "30 [-0.005357947666198015, 0.016027746722102165, ... \n", "31 [-0.01173881720751524, -0.03800323233008385, -... \n", "32 [-0.03346630930900574, 0.020460220053792, -0.0... \n", "33 [-0.01372881606221199, 0.04676871374249458, -0... \n", "34 [-0.03205938637256622, 0.0024826570879667997, ... \n", "35 [0.013667544350028038, 0.037819087505340576, -... \n", "36 [0.008692814968526363, 0.04825408011674881, -0... \n", "37 [0.03911886364221573, -0.0013522494118660688, ... \n", "38 [0.02589792013168335, -0.006817953661084175, 0... \n", "39 [0.059145040810108185, -0.02710546925663948, 0... \n", "40 [0.049356915056705475, -0.021680600941181183, ... " ] }, "execution_count": 94, "metadata": {}, "output_type": "execute_result" } ], "source": [ "pd.read_parquet(pfile)" ] }, { "cell_type": "code", "execution_count": 92, "metadata": {}, "outputs": [ { "data": { "text/plain": [ "file\n", "ATT_SEC_AnnualReport_2022.pdf 421\n", "ATT_CompanyReport_Annual_20230126.pdf 172\n", "AMZN_Moodys_CreditRating_2023.pdf 41\n", "Name: count, dtype: int64" ] }, "execution_count": 92, "metadata": {}, "output_type": "execute_result" } ], "source": [ "vect = pd.read_parquet(pfile)\n", "vect.file.value_counts()" ] } ], "metadata": { "kernelspec": { "display_name": "venv", "language": "python", "name": "python3" }, "language_info": { "codemirror_mode": { "name": "ipython", "version": 3 }, "file_extension": ".py", "mimetype": "text/x-python", "name": "python", "nbconvert_exporter": "python", "pygments_lexer": "ipython3", "version": "3.10.14" } }, "nbformat": 4, "nbformat_minor": 2 }