Segment Information (Tables)

12 Months Ended

Dec. 31, 2017

Segment Reporting [Abstract]

Schedule of segment information

The following table summarizes our segment results for 2017, 2016 and 2015 based on the segment categorization we were operating under at December 31, 2017.

	Years Ended December 31,
	2017			2016		2015
	(Dollars in millions)
Total segment revenues	$	16,924		16,766		17,171
Total segment expenses	9,390			9,081		9,025
Total segment income	$	7,534		7,685		8,146
Total margin percentage	45		%	46	%	47	%
Business segment:
Revenues	$	11,220		10,704		10,977
Expenses	6,847			6,391		6,395
Income	$	4,373		4,313		4,582
Margin percentage	39		%	40	%	42	%
Consumer segment:
Revenues	$	5,704		6,062		6,194
Expenses	2,543			2,690		2,630
Income	$	3,161		3,372		3,564
Margin percentage	55		%	56	%	58	%

Schedule of operating revenues by products and services

Our operating revenues for our products and services are presented as follows for the years ended December 31, 2017, 2016 and 2015:

	Years Ended December 31,
	2017		2016	2015
	(Dollars in millions)
Business segment
IP & Data Services (1)	$	3,595	2,851	2,704
Transport & Infrastructure (2)	3,680		3,929	4,157
Voice & Collaboration (3)	3,294		3,284	3,429
IT & Managed Services (4)	651		640	687
Total business segment revenues	11,220		10,704	10,977
Consumer segment
IP & Data Services (5)	448		506	468
Transport & Infrastructure (6)	2,871		2,897	2,829
Voice & Collaboration (3)	2,385		2,659	2,897
Total consumer segment revenues	5,704		6,062	6,194
Non-segment revenues
Regulatory revenues (7)	732		704	729
Total non-segment revenues	732		704	729
Total revenues	$	17,656	17,470	17,900

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(1)	Includes primarily VPN data network, Ethernet, IP and ancillary revenues.
(2)	Includes primarily broadband, private line (including business data services), colocation and data centers, wavelength and ancillary revenues.
(3)	Includes local, long-distance and other ancillary revenues.
(4)	Includes IT services and managed services revenues.
(5)	Includes retail video revenues (including our facilities-based video revenues).
(6)	Includes primarily broadband and equipment sales and professional services revenues.
(7)	Includes CAF Phase I, CAF Phase 2, federal and state USF support revenue, sublease rental income and failed-sale leaseback income.

Schedule of reconciliation from segment income to consolidated net income

The following table reconciles segment income to net income for the years ended December 31, 2017, 2016 and 2015:

	Years Ended December 31,
	2017			2016		2015
	(Dollars in millions)
Total segment income	$	7,534		7,685		8,146
Regulatory revenues	732			704		729
Depreciation and amortization	(3,936		)	(3,916	)	(4,189	)
Non-segment expenses	(2,321		)	(2,140	)	(2,107	)
Other expenses, net	(1,469		)	(1,313	)	(1,263	)
Income before income tax expense	540			1,020		1,316
Income tax benefit (expense)	849			(394	)	(438	)
Net income	$	1,389		626		878