Segment Information

3 Months Ended

Mar. 31, 2013

Segment Information

8. Segment Information

Reportable Segments

We have two reportable segments, which we operate and manage as strategic business units and organize by products and services. We measure and evaluate our reportable segments based on segment operating income, consistent with the chief operating decision maker’s assessment of segment performance.

Corporate, eliminations and other includes unallocated corporate expenses, intersegment eliminations recorded in consolidation, the results of other businesses, such as our investments in unconsolidated businesses, pension and other employee benefit related costs, lease financing, as well as other adjustments and gains and losses that are not allocated in assessing segment performance due to their non-operational nature. Although such transactions are excluded from the business segment results, they are included in reported consolidated earnings. Gains and losses that are not individually significant are included in all segment results as these items are included in the chief operating decision maker’s assessment of segment performance.

Our segments and their principal activities consist of the following:

Segment	Description
Wireless	Wireless’ communications products and services include wireless voice and data services and equipment sales, which are provided to consumer, business and government customers across the United States.
Wireline	Wireline’s voice, data and video communications products and enhanced services include local and long distance voice, broadband Internet access and video, corporate networking solutions, data center and cloud services and security and managed network services. We provide these products and services to consumers in the United States, as well as to carriers, businesses and government customers both in the United States and in over 150 other countries around the world.

The following table provides operating financial information for our two reportable segments:

	Three Months Ended March 31,
(dollars in millions)	2013			2012
External Operating Revenues
Wireless
Retail service	$	16,155		$	14,872
Other service		557			524
Service revenue		16,712			15,396
Equipment		1,809			1,835
Other		975			1,019
Total Wireless		19,496			18,250
Wireline
Consumer retail		3,590			3,441
Small business		648			659
Mass Markets		4,238			4,100
Strategic services		2,087			1,969
Core		1,660			1,882
Global Enterprise		3,747			3,851
Global Wholesale		1,471			1,592
Other		103			123
Total Wireline		9,559			9,666
Total segments		29,055			27,916
Corporate, eliminations and other		365			326
Total consolidated – reported	$	29,420		$	28,242
Intersegment Revenues
Wireless	$	27		$	23
Wireline		271			279
Total segments		298			302
Corporate, eliminations and other		(298	)		(302	)
Total consolidated – reported	$	–		$	–
Total Operating Revenues
Wireless	$	19,523		$	18,273
Wireline		9,830			9,945
Total segments		29,353			28,218
Corporate, eliminations and other		67			24
Total consolidated – reported	$	29,420		$	28,242
Operating Income
Wireless	$	6,418		$	5,217
Wireline		13			157
Total segments		6,431			5,374
Reconciling items		(209	)		(179	)
Total consolidated – reported	$	6,222		$	5,195

(dollars in millions)	At March 31, 2013			At December 31, 2012
Assets
Wireless	$	145,242		$	142,485
Wireline		85,746			84,815
Total segments		230,988			227,300
Reconciling items		(4,802	)		(2,078	)
Total consolidated – reported	$	226,186		$	225,222

A reconciliation of the total of the reportable segments’ operating income to consolidated income before provision for income taxes is as follows:

	Three Months Ended March 31,
(dollars in millions)	2013			2012
Total segment operating income	$	6,431		$	5,374
Corporate, eliminations and other		(209	)		(179	)
Total consolidated operating income		6,222			5,195
Equity in earnings of unconsolidated businesses		(5	)		103
Other income and (expense), net		39			19
Interest expense		(537	)		(685	)
Income Before Provision For Income Taxes	$	5,719		$	4,632

We generally account for intersegment sales of products and services and asset transfers at current market prices. No single customer accounted for more than 10% of our total operating revenues during the three months ended March 31, 2013 and 2012.