Revenue Recognition (Tables)

3 Months Ended

Mar. 31, 2023

Revenue from Contract with Customer [Abstract]

The following table provides total revenue by segment, sales channel and product category. It also provides the amount of revenue that is not subject to ASC 606, "Revenue from Contracts with Customers" ("ASC 606"), but is instead governed by other accounting standards. The amounts in the table below include revenue for the Latin American and ILEC businesses prior to their sales on August 1, 2022 and October 3, 2022, respectively. See Note 2—Divestitures of the Latin American and ILEC Businesses and Planned Divestiture of the EMEA Business in our Annual Report on Form 10-K for the year ended December 31, 2022 for additional information on these divestitures.


	Three Months Ended March 31, 2023				Three Months Ended March 31, 2022
	Total Revenue		Adjustments for Non-ASC 606 revenue (1)	Total revenue from Contracts with Customers	Total Revenue	Adjustments for Non-ASC 606 revenue (1)	Total revenue from Contracts with Customers
	(Dollars in millions)
Business Segment by Sales Channel and Product Category
Large Enterprise
Grow	$	550	(79)	471	653	(103)	550
Nurture	375		—	375	454	—	454
Harvest	207		—	207	276	—	276
Other	62		(1)	61	59	(2)	57
Total Large Enterprise Revenue	1,194		(80)	1,114	1,442	(105)	1,337
Mid-Market Enterprise
Grow	196		(7)	189	185	(8)	177
Nurture	211		—	211	241	—	241
Harvest	100		(1)	99	140	(2)	138
Other	8		(2)	6	7	—	7
Total Mid-Market Enterprise Revenue	515		(10)	505	573	(10)	563
Public Sector
Grow	116		(19)	97	115	(27)	88
Nurture	106		—	106	131	—	131
Harvest	99		—	99	124	(1)	123
Other	109		—	109	109	—	109
Total Public Sector Revenue	430		(19)	411	479	(28)	451
Wholesale
Grow	266		(71)	195	233	(67)	166
Nurture	213		(6)	207	267	(7)	260
Harvest	333		(44)	289	407	(58)	349
Other	5		—	5	—	—	—
Total Wholesale Revenue	817		(121)	696	907	(132)	775
Business Segment by Product Category
Grow	1,128		(176)	952	1,186	(205)	981
Nurture	905		(6)	899	1,093	(7)	1,086
Harvest	739		(45)	694	947	(61)	886
Other	184		(3)	181	175	(2)	173
Total Business Segment Revenue	2,956		(230)	2,726	3,401	(275)	3,126
Mass Markets Segment by Product Category
Fiber Broadband	152		(4)	148	145	(5)	140
Other Broadband	369		(33)	336	610	(56)	554
Voice and Other	261		(9)	252	520	(79)	441
Total Mass Markets Revenue	782		(46)	736	1,275	(140)	1,135
Total Revenue	$	3,738	(276)	3,462	4,676	(415)	4,261

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(1)Includes regulatory revenue and lease revenue not within the scope of ASC 606.

Contract with Customer, Asset and Liability

The following table provides balances of customer receivables, contract assets and contract liabilities, net of amounts classified as held for sale, as of March 31, 2023 and December 31, 2022:


	March 31, 2023		December 31, 2022
	(Dollars in millions)
Customer receivables(1)	$	1,374	1,424
Contract assets(2)	30		34
Contract liabilities(3)	675		656

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(1)Reflects gross customer receivables of $1.4 billion and $1.5 billion, net of allowance for credit losses of $72 million and $73 million, at March 31, 2023 and December 31, 2022, respectively. These amounts exclude customer receivables, net, classified as held for sale of $85 million at March 31, 2023 and $76 million at December 31, 2022 related to the EMEA business.

(2)These amounts exclude contract assets classified as held for sale of $13 million at March 31, 2023 and $16 million at December 31, 2022 related to the EMEA business.

(3)These amounts exclude contract liabilities classified as held for sale of $57 million at March 31, 2023 and $59 million at December 31, 2022 related to the EMEA business.

Capitalized Contract Cost

The following table provides changes in our contract acquisition costs and fulfillment costs:


	Three Months Ended March 31, 2023			Three Months Ended March 31, 2022
	Acquisition Costs		Fulfillment Costs	Acquisition Costs	Fulfillment Costs
	(Dollars in millions)			(Dollars in millions)
Beginning of period balance(1)(2)	$	202	192	222	186
Costs incurred	36		40	43	40
Amortization	(41)		(35)	(52)	(39)
Change in contract costs held for sale	(5)		(15)	2	—
End of period balance(3)(4)	$	192	182	215	187

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(1)Beginning of period balance for the three months ended March 31, 2023 excludes $6 million of acquisition costs and no fulfillment costs classified as held for sale related to the EMEA business.

(2)Beginning of period balance for the three months ended March 31, 2022 excludes acquisition costs and fulfillment costs classified as held for sale of $34 million and $32 million, respectively (related to both the Latin American business and the ILEC business).

(3)End of period balance for the three months ended March 31, 2023 excludes $11 million of acquisition costs and $15 million fulfillment costs classified as held for sale related to the EMEA business.

(4)End of period balance for the three months ended March 31, 2022 excludes acquisition costs and fulfillment costs classified as held for sale of $32 million and $32 million, respectively (related to both the Latin American business and the ILEC business).