10-KPeriod: FY2022

AT&T INC. Annual Report, Year Ended Dec 31, 2022

Filed February 13, 2023For Securities:TT-PCTBBT-PA

Summary

AT&T Inc. reported a decrease in total operating revenues for the fiscal year ending December 31, 2022, primarily due to the separation of its U.S. video business and other divestitures. While Mobility and Consumer Wireline segments showed growth, Business Wireline experienced a decline. The company incurred significant non-cash goodwill impairments in 2022, particularly in Business Wireline, Consumer Wireline, and Mexico segments, driven by higher interest rates and secular declines. AT&T continues to focus on its core growth areas of 5G and fiber, investing heavily in network expansion and enhancements. Financially, the company saw a decrease in cash provided by operating activities, partly attributed to working capital impacts and higher payments for wireless devices. Significant financing activities included debt repayment and dividend payments, with a focus on managing debt levels in 2023. AT&T maintained compliance with its debt covenants, and liquidity remains available through its credit facilities. The company's strategic priorities for 2023 include continued wireless subscriber momentum, 5G deployment, fiber footprint expansion, and cost transformation initiatives to drive efficiency.

Financial Highlights

50 data points
Beta

Revenue

$120.74B

Net Income

-$8.52B

-7.1% Net Margin

EPS (Diluted)

$-1.13

Total Assets

$402.85B

Cash & Equivalents

$3.70B

Free Cash Flow

$35.81B

Financial Statements
Beta
Revenue$120.74B
SG&A Expenses$28.96B
Operating Expenses$125.33B
Operating Income-$4.59B
Interest Expense$6.11B
Net Income-$8.52B
EPS (Basic)$-1.13
EPS (Diluted)$-1.13
Shares Outstanding (Basic)7.17B
Shares Outstanding (Diluted)7.59B

Key Highlights

  • 1Total operating revenues decreased by 9.9% to $120.74 billion in 2022, largely due to business divestitures and the separation of the U.S. video business.
  • 2The Communications segment remains the primary revenue driver, accounting for 97% of total segment operating revenues in 2022.
  • 3Mobility segment revenues grew 4.5% to $81.78 billion, driven by subscriber gains and increased average revenue per user (ARPU).
  • 4Consumer Wireline segment revenues increased by 1.7% to $12.75 billion, boosted by fiber broadband customer growth.
  • 5Business Wireline segment revenues declined by 5.8% to $22.54 billion, reflecting lower demand for legacy services.
  • 6AT&T incurred significant goodwill impairments totaling $24.81 billion in 2022, impacting Business Wireline, Consumer Wireline, and Mexico reporting units.
  • 7Capital expenditures for network investments, including fiber and 5G, were $19.63 billion in 2022, with similar levels expected for 2023.

Frequently Asked Questions

AT&T's primary revenue driver was its Communications segment, which includes Mobility (wireless services and equipment) and Consumer Wireline (broadband services). Mobility saw growth in service and equipment revenue, while Consumer Wireline benefited from an increase in fiber broadband customers. The Business Wireline segment experienced a decline due to lower demand for legacy services.

AT&T reported a decrease in total operating revenues and incurred substantial non-cash goodwill impairments of $24.81 billion, primarily in its Business Wireline, Consumer Wireline, and Mexico segments. These impairments were largely attributed to macroeconomic factors like rising interest rates and secular declines in certain business areas. The company also saw a decrease in cash provided by operating activities compared to the prior year.

AT&T's strategic focus for future growth is on its 5G and fiber networks. The company continued to invest heavily in expanding its 5G service nationwide and accelerating fiber network deployment, aiming to capture increasing demand for high-speed connectivity. These investments are central to its strategy of offering integrated mobile and broadband solutions.

AT&T ended 2022 with $3.70 billion in cash and cash equivalents and $135.89 billion in total debt. The company's financing activities in 2023 are focused on managing its debt level and paying dividends. AT&T plans to fund its operations through cash from operations, debt issuance, and asset sales, while maintaining access to liquidity through its credit facilities.