8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of report (Date of earliest event reported) October 28, 2019

AT&T INC.

(Exact Name of Registrant as Specified in Charter)

Delaware	001-08610	43-1301883
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

208 S. Akard St., Dallas, Texas	75202
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code (210) 821-4105

__________________________________

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240-14d-2(b))

☐  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act

		Name of each exchange
Title of each class	Trading Symbol(s)	on which registered
Common Shares (Par Value $1.00 Per Share)	T	New York Stock Exchange
AT&T Inc. Floating Rate Global Notes due August 3, 2020	T 20C	New York Stock Exchange
AT&T Inc. 1.875% Global Notes due December 4, 2020	T 20	New York Stock Exchange
AT&T Inc. 2.65% Global Notes due December 17, 2021	T 21B	New York Stock Exchange
AT&T Inc. 1.45% Global Notes due June 1, 2022	T 22B	New York Stock Exchange
AT&T Inc. 2.50% Global Notes due March 15, 2023	T 23	New York Stock Exchange
AT&T Inc. 2.75% Global Notes due May 19, 2023	T 23C	New York Stock Exchange

		Name of each exchange
Title of each class	Trading Symbol(s)	on which registered
AT&T Inc. Floating Rate Global Notes due September 5, 2023	T 23D	New York Stock Exchange
AT&T Inc. 1.05% Global Notes due September 5, 2023	T 23E	New York Stock Exchange
AT&T Inc. 1.30% Global Notes due September 5, 2023	T 23A	New York Stock Exchange
AT&T Inc. 1.95% Global Notes due September 15, 2023	T 23F	New York Stock Exchange
AT&T Inc. 2.40% Global Notes due March 15, 2024	T 24A	New York Stock Exchange
AT&T Inc. 3.50% Global Notes due December 17, 2025	T 25	New York Stock Exchange
AT&T Inc. 0.250% Global Notes due March 4, 2026	T 26E	New York Stock Exchange
AT&T Inc. 1.80% Global Notes due September 5, 2026	T 26D	New York Stock Exchange
AT&T Inc. 2.90% Global Notes due December 4, 2026	T 26A	New York Stock Exchange
AT&T Inc. 2.35% Global Notes due September 5, 2029	T 29D	New York Stock Exchange
AT&T Inc. 4.375% Global Notes due September 14, 2029	T 29B	New York Stock Exchange
AT&T Inc. 2.60% Global Notes due December 17, 2029	T 29A	New York Stock Exchange
AT&T Inc. 0.800% Global Notes due March 4, 2030	T 30B	New York Stock Exchange
AT&T Inc. 3.55% Global Notes due December 17, 2032	T 32	New York Stock Exchange
AT&T Inc. 5.20% Global Notes due November 18, 2033	T 33	New York Stock Exchange
AT&T Inc. 3.375% Global Notes due March 15, 2034	T 34	New York Stock Exchange
AT&T Inc. 2.45% Global Notes due March 15, 2035	T 35	New York Stock Exchange
AT&T Inc. 3.15% Global Notes due September 4, 2036	T 36A	New York Stock Exchange
AT&T Inc. 1.800% Global Notes due September 14, 2039	T 39B	New York Stock Exchange
AT&T Inc. 7.00% Global Notes due April 30, 2040	T 40	New York Stock Exchange
AT&T Inc. 4.25% Global Notes due June 1, 2043	T 43	New York Stock Exchange
AT&T Inc. 4.875% Global Notes due June 1, 2044	T 44	New York Stock Exchange
AT&T Inc. 5.35% Global Notes due November 1, 2066	TBB	New York Stock Exchange
AT&T Inc. 5.625% Global Notes due August 1, 2067	TBC	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Item 8.01 Other Events.

Throughout this document, AT&T Inc. is referred to as “we” or “AT&T.” AT&T is a holding company whose subsidiaries and affiliates operate worldwide in the telecommunications, media and technology industries.

Overview

We announced on October 28, 2019 that third-quarter 2019 net income attributable to AT&T totaled $3.7 billion, or $0.50 per diluted share, compared to $4.7 billion, or $0.65 per diluted share, in the third quarter of 2018. Third-quarter 2019 revenues were $44.6 billion, down 2.5 percent from the third quarter of 2018 primarily due to continued declines in legacy voice and data services, lower theatrical product resulting from a more favorable mix of box office releases in the prior year, and pressure in video subscriptions and wireless equipment sales. Partially offsetting these declines were growth in wireless service, strategic and managed business services and Home Box Office (HBO) international licensing. Compared with results for the third quarter of 2018, current quarter operating expenses were $36.7 billion, down 4.6 percent primarily due to lower amortization of intangible assets, slower wireless upgrade rates and decreased content costs largely attributable to fewer premium TV subscribers. Third-quarter operating income was $7.9 billion compared to $7.3 billion in the comparable 2018 period, and AT&T’s third-quarter operating income margin was 17.7 percent, compared to 15.9 percent. Third-quarter 2019 cash from operating activities was $11.4 billion, down $1.0 billion when compared to 2018, driven by increased spend on film and television production and higher tax payments. Capital expenditures in the third quarter of 2019 were $5.2 billion, and when including $765 million cash paid for vendor financing, cash paid for capital investment was $6.0 billion.

Segment Summary

We analyze our segments based on, among other things, segment contribution, which consists of operating income, excluding acquisition-related costs and other significant items, and equity in net income (loss) of affiliates for investments managed within each segment. Our reportable segments are: Communications, WarnerMedia, Latin America and Xandr.

Communications

Our Communications segment consists of our Mobility, Entertainment Group and Business Wireline business units. Historical results in the Mobility and Business Wireline business units of the Communications segment have been recast to remove operations in Puerto Rico and the U.S. Virgin Islands, for which we began held-for-sale accounting in the third quarter of 2019.

Third-quarter 2019 operating revenues were $35.4 billion, down 1.7 percent versus third-quarter 2018, with segment operating contribution of $8.0 billion, down 1.4 percent versus the year-ago quarter. The Communications segment operating income margin was 22.7 percent, compared to 22.6 percent in the year-earlier quarter.

Mobility

Mobility revenues for the third quarter of 2019 were $17.7 billion, down 0.2 percent versus the third quarter of 2018 driven by decreased equipment revenues as lower upgrade rates continue, partially offset by higher service revenues resulting from postpaid phone average revenue per subscriber (ARPU) growth and prepaid subscriber gains. Mobility operating expenses totaled $12.0 billion, down 1.7 percent versus the third quarter of 2018. The decrease was driven by slower postpaid upgrade rates, lower depreciation and cost efficiencies, partially offset by higher bad debt expense, commission deferral amortization and handset insurance costs. Mobility’s operating income margin was 32.4 percent compared to 31.4 percent in the year-ago quarter.

In our Mobility business unit, we reported a net gain of 3.7 million wireless subscribers. At September 30, 2019, wireless subscribers totaled 162.3 million compared to 149.2 million for the prior comparable period.

During the third quarter, total phone net adds were 255,000, with total net adds by subscriber category as follows:

• Prepaid subscriber net adds were 227,000, including 154,000 phone net adds.

• Postpaid subscriber net adds were a loss of 217,000, with phone adds of 101,000 offsetting losses from tablets.

• Reseller net adds were a loss of 231,000.

• Connected device net adds were 3.9 million, 2.1 million of which were primarily attributable to wholesale connected cars.

For the quarter ended September 30, 2019, postpaid phone-only ARPU increased 0.6 percent versus the year-earlier quarter.

Postpaid phone-only churn was 0.95 percent, compared to 0.93 percent in the third quarter of 2018. Total postpaid churn was 1.19 percent, compared to 1.16 percent in the year-ago quarter.

Entertainment Group

Entertainment Group (Entertainment) revenues for the third quarter of 2019 were $11.2 billion, down 3.4 percent versus the year-ago quarter reflecting continuing declines in premium TV subscribers and legacy services that were partially offset by higher broadband revenues. Entertainment operating expenses totaled $10.1 billion, down 3.6 percent versus the third quarter of 2018. The decrease was largely driven by lower content and selling costs reflecting fewer subscribers, and cost initiatives, partially offset by higher costs associated with NFL SUNDAY TICKET and higher amortization of fulfillment cost deferrals. The Entertainment operating income margin was 9.7 percent compared to 9.5 percent in the year-earlier quarter.

At September 30, 2019, Entertainment revenue connections included:

• Approximately 21.6 million video connections (including 1.1 million AT&T Now subscribers) at September 30, 2019 compared to 25.2 million at September 30, 2018. During the third quarter of 2019, net adds for premium TV video subscribers was a loss of 1.2 million and AT&T Now subscribers had net losses of 195,000.

• Approximately 14.3 million broadband connections at September 30, 2019 compared to 14.4 million at September 30, 2018. During the third quarter, IP broadband had a net loss of 83,000 (including fiber broadband net adds of 318,000), with 13.7 million subscribers at September 30, 2019.

Business Wireline

Business Wireline (Business) revenues for the third quarter of 2019 were $6.5 billion, down 2.7 percent versus the year-ago quarter reflecting continued declines in legacy revenues, partially offset by growth in strategic and managed services. Business operating expenses totaled $5.3 billion, up 1.6 percent versus the third quarter of 2018, driven by increased depreciation expense. Business operating income margin was 18.6 percent compared to 22.1 percent in the year-earlier quarter.

At September 30, 2019, our total switched access lines (Entertainment and Business) were 8.8 million compared to 10.4 million at September 30, 2018. The number of U-verse voice connections (which use VoIP technology and therefore are not included in the access line total) decreased by 227,000 in the quarter, totaling 4.5 million at September 30, 2019, compared to 5.3 million at September 30, 2018.

WarnerMedia

Our WarnerMedia segment consists of our Turner, HBO and Warner Bros. business units. Third-quarter 2019 operating revenues were $7.8 billion, down 4.4 percent versus third-quarter 2018, with segment operating contribution of $2.5 billion, up 0.6 percent versus the year-ago quarter. The WarnerMedia segment operating income margin was 32.2 percent, compared to 31.3 percent in the year-earlier quarter.

Turner

Turner revenues for the third quarter of 2019 were $3.0 billion, up 0.6 percent versus the third quarter of 2018 driven by higher subscription revenues due to higher domestic affiliate rates and growth at Turner’s international networks, partially offset by lower advertising revenues resulting from lower audience delivery in the domestic entertainment networks. Turner operating expenses totaled $1.5 billion, down 1.2 percent versus the third quarter of 2018, driven by lower programming, marketing and direct operating costs. Turner operating income margin was 49.2 percent compared to 48.3 percent in the year-earlier quarter.

HBO

HBO revenues for the third quarter of 2019 were $1.8 billion, up 10.6 percent versus the third quarter of 2018 driven by higher content and other revenues resulting from international licensing revenues. HBO operating expenses totaled $1.1 billion, up 8.8 percent versus the third quarter of 2018, driven by increased programming, distribution and marketing expenses. HBO operating income margin was 39.3 percent compared to 38.2 percent in the year-earlier quarter.

Warner Bros.

Warner Bros. revenues for the third quarter of 2019 were $3.3 billion, down 10.4 percent versus the third quarter of 2018 driven by lower theatrical product resulting from a more favorable mix of box office releases in the prior comparable period, and lower television licensing, partly offset by strong games and increased initial telecast revenues. Warner Bros. operating expenses totaled $2.7 billion, down 12.7 percent versus the third quarter of 2018, driven by lower film and television production costs. Warner Bros. operating income margin was 17.6 percent compared to 15.5 percent in the year-earlier quarter.

Latin America

Our Latin America segment consists of our Mexico and Vrio business units and is subject to foreign currency fluctuations. Third-quarter 2019 operating revenues were $1.7 billion, down 5.6 percent versus the prior year. Segment operating contribution was $(166) million, versus $(201) million in the comparable 2018 period. Both operating revenue and segment contribution declines were driven by foreign exchange pressures. The Latin America operating income margin was (10.3) percent, compared to (11.5) percent in the year-earlier quarter.

Mexico

Wireless revenues were $717 million, down 1.9 percent when compared to the third quarter of 2018. Decreased revenues were primarily due to lower equipment sales, partially offset by increased service revenue from prepaid subscriber growth. Operating expenses were $896 million, down 10.2 percent and Mexico’s operating income margin was (25.0) percent, compared to (36.5) percent in the year-earlier quarter.

We had approximately 18.6 million Mexican wireless subscribers at September 30, 2019 compared to 17.3 million at September 30, 2018. During the third quarter of 2019, we had prepaid net adds of 668,000 and postpaid net losses of 137,000.

Vrio

Video service revenues were $1.0 billion, down 8.1 percent versus the prior year. Operating expenses were $1.0 billion, down 3.1 percent. Both operating revenue and expense declines were driven by foreign exchange pressures. Vrio’s operating income was $0, compared to $57 million, or an operating income margin of 5.2 percent, in the year-earlier quarter.

We had approximately 13.3 million Latin America video connections at September 30, 2019 compared to 13.6 million at September 30, 2018. During the third quarter of 2019, video net adds were a loss of 167,000.

Xandr

Our Xandr segment provides advertising services utilizing data insights to develop higher-value targeted advertising. Certain revenues in this segment are also reported by the Communications segment and are eliminated upon consolidation. Third-quarter 2019 operating revenues were $504 million, up 13.3 percent versus the prior year, impacted by the August 2018 acquisition of AppNexus. Operating expenses were $177 million, up 58.0 percent due to AppNexus, investment in new technology and the development of our data advertising platform. Xandr segment operating contribution was $327 million, down 1.8 percent versus third-quarter 2018. The Xandr segment operating income margin was 64.9 percent, compared to 74.8 percent in the year-earlier quarter.

Supplemental Discussions

As a supplemental discussion of our operating results, for comparison purposes, we are providing (1) our AT&T Business Solutions results which include both wireless and wireline operations and (2) a combined view of reported advertising revenues across all segments of AT&T. A reconciliation of the non-GAAP numbers in this supplemental discussion is attached as exhibit 99.2 hereto.

AT&T Business Solutions

Revenues from AT&T Business Solutions for the third quarter of 2019 were $9.2 billion, up 0.9 percent versus the year-ago quarter driven by growth in strategic and managed services and wireless service revenues, partially offset by declines in our legacy voice and data services. Operating expenses totaled $7.2 billion, up 2.2 percent versus the third quarter of 2018. AT&T Business Solutions operating income margin was 21.6 percent, compared to 22.6 percent in the year-earlier quarter.

AT&T Advertising Revenues

Total AT&T Advertising revenues for the third quarter of 2019 were $1.5 billion, up 1.2 percent, primarily driven by Xandr.

2020-2022 Guidance

For 2020. we expect:

• Consolidated revenue to grow between 1 to 2 percent.

• Adjusted earnings per share of $3.60 to $3.70 per share, including HBO Max investment.

• Total gross capital investment, which consists of capital expenditures plus potential vendor financing payments and excludes any expected FirstNet reimbursements, to be in the $20 billion range.

• Asset monetization in 2020 of approximately $5 billion to $10 billion of non-strategic assets, including sales and working capital initiatives.

During the next three years (2020-2022), we expect:

• Consolidated revenue to grow between 1 and 2 percent on a compound annual growth rate. We expect our revenue growth over 2020-2022 to be driven by (1) wireless services, including subscriber growth and 5G device sales, (2) Warner Media including revenue synergies, HBO Max and advertising and content, and (3) broadband services.

• Continued modest annual dividend growth and common stock retirements representing approximately 70 percent of the shares issued for the Time Warner Inc. (Time Warner) acquisition. The company also expects over the same time period to retire all of the acquisition debt from the Time Warner deal.

• Adjusted earnings per share of $4.50 to $4.80 by 2022, including HBO Max investment.

 

Our guidance excludes adjusting items. Adjustments to 2020 and 2022 earnings per share include merger-related adjusted amortization in the range of $17.0 billion, a non-cash mark-to-market benefit plan gain/loss, merger integration and other adjustments. We expect the mark-to-market adjustment, which is driven by interest rates and investment returns that are not reasonably estimable at this time, to be a significant item. Our 2022 EPS estimate assumes share retirements of approximately 40 cents, new cost initiatives and EBITDA growth in our Mexico operations of a combined 25 cents, WarnerMedia synergies of approximately 20 cents and organic growth opportunities, that we expect to be partially offset by dilution from HBO Max. Our adjusted EPS estimate depend on future levels of revenues and expenses which are not reasonably estimable at this time. Accordingly, we cannot provide a reconciliation between forecasted adjusted diluted EPS and reported diluted EPS without unreasonable effort.

CAUTIONARY LANGUAGE CONCERNING FORWARD-LOOKING STATEMENTS

Information set forth in this filing contains financial estimates and other forward-looking statements that are subject to risks and uncertainties. A discussion of factors that may affect future results is contained in AT&T’s filings with the Securities and Exchange Commission. AT&T disclaims any obligation to update or revise statements contained in this filing based on new information or otherwise.

Item 9.01 Financial Statements and Exhibits.

The following exhibits are filed as part of this report:

(d)          Exhibits

99.1	AT&T Inc. selected financial statements and operating data.
99.2	Discussion and reconciliation of non-GAAP measures.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	AT&T INC.
Date: October 28, 2019	By: /s/ Debra L. Dial                                  .        Debra L. Dial Senior Vice President and Controller

EX-99.2

AT&T Inc.
Financial Data
Consolidated Statements of Income
Dollars in millions except per share amounts
Unaudited	Third Quarter				Percent		Nine-Month Period				Percent
		2019		2018	Change			2019		2018	Change
Operating Revenues
Service	$	40,317	$	41,297	(2.4)	%	$	122,024	$	109,849	11.1	%
Equipment		4,271		4,442	(3.8)	%		12,348		12,914	(4.4)	%
Total Operating Revenues		44,588		45,739	(2.5)	%		134,372		122,763	9.5	%
Operating Expenses
Cost of revenues
Equipment		4,484		4,828	(7.1)	%		13,047		14,053	(7.2)	%
Broadcast, programming and operations		7,066		7,227	(2.2)	%		22,448		17,842	25.8	%
Other cost of revenues (exclusive of depreciation           and amortization shown separately below)		8,604		8,651	(0.5)	%		25,910		24,215	7.0	%
Selling, general and administrative		9,584		9,598	(0.1)	%		29,077		26,179	11.1	%
Depreciation and amortization		6,949		8,166	(14.9)	%		21,256		20,538	3.5	%
Total Operating Expenses		36,687		38,470	(4.6)	%		111,738		102,827	8.7	%
Operating Income		7,901		7,269	8.7	%		22,634		19,936	13.5	%
Interest Expense		2,083		2,051	1.6	%		6,373		5,845	9.0	%
Equity in Net Income (Loss) of Affiliates		3		(64)	-	%		36		(71)	-	%
Other Income (Expense) - Net		(935)		1,053	-	%		(967)		5,108	-	%
Income Before Income Taxes		4,886		6,207	(21.3)	%		15,330		19,128	(19.9)	%
Income Tax Expense		937		1,391	(32.6)	%		3,059		4,305	(28.9)	%
Net Income		3,949		4,816	(18.0)	%		12,271		14,823	(17.2)	%
Less: Net Income Attributable to     Noncontrolling Interest		(249)		(98)	-	%		(762)		(311)	-	%
Net Income Attributable to AT&T	$	3,700	$	4,718	(21.6)	%	$	11,509	$	14,512	(20.7)	%
Basic Earnings Per Share Attributable to AT&T	$	0.50	$	0.65	(23.1)	%	$	1.57	$	2.19	(28.3)	%
Weighted Average Common     Shares Outstanding (000,000)		7,327		7,284	0.6	%		7,321		6,603	10.9	%
Diluted Earnings Per Share Attributable to AT&T	$	0.50	$	0.65	(23.1)	%	$	1.57	$	2.19	(28.3)	%
Weighted Average Common      Shares Outstanding with Dilution (000,000)		7,356		7,320	0.5	%		7,350		6,630	10.9	%

AT&T Inc.
Financial Data
Consolidated Balance Sheets
Dollars in millions
Unaudited		Sep. 30,		Dec. 31,
		2019		2018
Assets
Current Assets
Cash and cash equivalents	$	6,588	$	5,204
Accounts receivable - net of allowances for doubtful accounts of $1,121 and $907		22,921		26,472
Prepaid expenses		1,493		2,047
Other current assets		19,693		17,704
Total current assets		50,695		51,427
Noncurrent Inventories and Theatrical Film and Television Production Costs		12,014		7,713
Property, Plant and Equipment – Net		131,316		131,473
Goodwill		146,106		146,370
Licenses – Net		96,026		96,144
Trademarks and Trade Names – Net		23,855		24,345
Distribution Networks – Net		15,806		17,069
Other Intangible Assets – Net		22,060		26,269
Investments in and Advances to Equity Affiliates		4,137		6,245
Operating Lease Right-of-Use Assets		24,477		-
Other Assets		22,304		24,809
Total Assets	$	548,796	$	531,864
Liabilities and Stockholders’ Equity
Current Liabilities
Debt maturing within one year	$	11,608	$	10,255
Accounts payable and accrued liabilities		43,955		43,184
Advanced billings and customer deposits		6,097		5,948
Accrued taxes		2,741		1,179
Dividends payable		3,725		3,854
Total current liabilities		68,126		64,420
Long-Term Debt		153,568		166,250
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes		57,786		57,859
Postemployment benefit obligation		22,853		19,218
Operating lease liabilities		22,288		-
Other noncurrent liabilities		29,848		30,233
Total deferred credits and other noncurrent liabilities		132,775		107,310
Stockholders’ Equity
Common stock		7,621		7,621
Additional paid-in capital		125,139		125,525
Retained earnings		59,347		58,753
Treasury stock		(11,195)		(12,059)
Accumulated other comprehensive income		2,137		4,249
Noncontrolling interest		11,278		9,795
Total stockholders’ equity		194,327		193,884
Total Liabilities and Stockholders' Equity	$	548,796	$	531,864

AT&T Inc.
Financial Data
Consolidated Statements of Cash Flows
Dollars in millions
Unaudited	Nine-Month Period
		2019		2018
Operating Activities
Net income	$	12,271	$	14,823
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		21,256		20,538
Amortization of film and television costs		7,059		1,608
Undistributed earnings from investments in equity affiliates		81		312
Provision for uncollectible accounts		1,855		1,240
Deferred income tax expense (benefit)		1,039		4,337
Net (gain) loss from investments, net of impairments		(1,014)		(501)
Pension and postiretirement benefit expense (credit)		(1,297)		(762)
Actuarial (gain) loss on pension and postretirement benefits		4,048		(2,726)
Changes in operating assets and liabilities:
Receivables		2,503		(1,268)
Other current assets, inventories and theatrical film and television production costs		(9,337)		(2,729)
Accounts payable and other accrued liabilities		(936)		(1,385)
Equipment installment receivables and related sales		848		220
Deferred customer contract acquisition and fulfillment costs		(796)		(2,657)
Postretirement claims and contributions		(635)		(630)
Other - net		(220)		1,102
Total adjustments		24,454		16,699
Net Cash Provided by Operating Activities		36,725		31,522
Investing Activities
Capital expenditures:
Purchase of property and equipment		(15,683)		(16,695)
Interest during construction		(160)		(404)
Acquisitions, net of cash acquired		(1,124)		(43,116)
Dispositions		3,775		983
(Purchases), sales and settlement of securities and investments, net		523		(234)
Advances to and investments in equity affiliates, net		(333)		(1,021)
Cash collections of deferred purchase price		-		500
Net Cash Used in Investing Activities		(13,002)		(59,987)
Financing Activities
Net change in short-term borrowings with original maturities of three months or less		(22)		(1,071)
Issuance of other short-term borrowings		4,012		4,852
Repayment of other short-term borrowings		(4,702)		(1,075)
Issuance of long-term debt		15,034		38,325
Repayment of long-term debt		(24,368)		(43,579)
Payment of vendor financing		(2,601)		(347)
Purchase of treasury stock		(409)		(577)
Issuance of treasury stock		576		359
Issuance of preferred interest in subsidiary		1,488		-
Dividends paid		(11,162)		(9,775)
Other		(187)		(791)
Net Cash Used in Financing Activities		(22,341)		(13,679)
Net increase (decrease) in cash and cash equivalents and restricted cash		1,382		(42,144)
Cash and cash equivalents and restricted cash beginning of year		5,400		50,932
Cash and Cash Equivalents and Restricted Cash End of Period	$	6,782	$	8,788

AT&T Inc.
Consolidated Supplementary Data
Supplementary Financial Data
Dollars in millions except per share amounts
Unaudited		Third Quarter				Percent		Nine-Month Period					Percent
			2019		2018	Change			2019		2018		Change
Capital expenditures
	Purchase of property and equipment	$	5,141	$	5,736	(10.4)	%	$	15,683	$	16,695		(6.1)	%
	Interest during construction		48		137	(65.0)	%		160		404		(60.4)	%
Total Capital Expenditures		$	5,189	$	5,873	(11.6)	%	$	15,843	$	17,099		(7.3)	%
Dividends Declared per Share		$	0.51	$	0.50	2.0	%	$	1.53	$	1.50		2.0	%
End of Period Common Shares Outstanding (000,000)									7,303		7,270		0.5	%
Debt Ratio									45.9	%	49.8	%	(390)	BP
Total Employees									251,840		269,280		(6.5)	%
Supplementary Operating Data
Subscribers and connections in thousands
Unaudited								September 30,					Percent
									2019		2018		Change
Wireless Subscribers
	Domestic								162,300		149,150		8.8	%
	Mexico								18,619		17,305		7.6	%
Total Wireless Subscribers									180,919		166,455		8.7	%
Video Connections
	Domestic								21,573		25,176		(14.3)	%
	Latin America								13,306		13,640		(2.4)	%
Total Video Connections									34,879		38,816		(10.1)	%
Broadband Connections
	IP								14,786		14,745		0.3	%
	DSL								789		1,002		(21.3)	%
Total Broadband Connections									15,575		15,747		(1.1)	%
Voice Connections
	Network Access Lines								8,831		10,399		(15.1)	%
	U-verse  VoIP Connections								4,539		5,274		(13.9)	%
Total Retail Voice Connections									13,370		15,673		(14.7)	%
		Third Quarter				Percent		Nine-Month Period					Percent
			2019		2018	Change			2019		2018		Change
Wireless Net Additions
	Domestic		3,679		3,432	7.2	%		10,369		9,166		13.1	%
	Mexico		598		907	(34.1)	%		990		2,206		(55.1)	%
Total Wireless Net Additions			4,277		4,339	(1.4)	%		11,359		11,372		(0.1)	%
Video Net Additions
	Domestic		(1,358)		(297)	-	%		(2,931)		(92)		-	%
	Latin America		(167)		(73)	-	%		(310)		52		-	%
Total Video Net Additions			(1,525)		(370)	-	%		(3,241)		(40)		-	%
Broadband Net Additions
	IP		(74)		36	-	%		33		258		(87.2)	%
	DSL		(49)		(62)	21.0	%		(160)		(230)		30.4	%
Total Broadband Net Additions			(123)		(26)	-	%		(127)		28		-	%

COMMUNICATIONS SEGMENT
The Communications segment provides wireless and wireline telecom, video and broadband services to consumers located in the U.S. or in U.S. territories and businesses globally. The Communications segment contains three reporting units: Mobility, Entertainment Group, and Business Wireline. Historical results in the Mobility and Business Wireline business units of the Communications segment have been recast to remove operations in Puerto Rico and the U.S. Virgin Islands, which we began held-for-sale accounting in the third quarter of 2019.
Segment Results
Dollars in millions
Unaudited		Third Quarter				Percent		Nine-Month Period				Percent
			2019		2018	Change			2019		2018	Change
Segment Operating Revenues
	Mobility	$	17,701	$	17,735	(0.2)	%	$	52,356	$	51,965	0.8	%
	Entertainment Group		11,197		11,589	(3.4)	%		33,893		34,498	(1.8)	%
	Business Wireline		6,503		6,683	(2.7)	%		19,588		20,035	(2.2)	%
Total Segment Operating Revenues			35,401		36,007	(1.7)	%		105,837		106,498	(0.6)	%
Segment Operating Contribution
	Mobility		5,742		5,575	3.0	%		16,817		16,144	4.2	%
	Entertainment Group		1,085		1,104	(1.7)	%		4,077		3,888	4.9	%
	Business Wireline		1,209		1,471	(17.8)	%		3,824		4,466	(14.4)	%
Total Segment Operating Contribution		$	8,036	$	8,150	(1.4)	%	$	24,718	$	24,498	0.9	%

Mobility
Mobility provides nationwide wireless service and equipment. Results have been recast to conform to the current period's presentation.
Mobility Results
Dollars in millions
Unaudited	Third Quarter					Percent		Nine-Month Period					Percent
		2019		2018		Change			2019		2018		Change
Operating Revenues
Service	$	13,930	$	13,828		0.7	%	$	41,383	$	40,594		1.9	%
Equipment		3,771		3,907		(3.5)	%		10,973		11,371		(3.5)	%
Total Operating Revenues		17,701		17,735		(0.2)	%		52,356		51,965		0.8	%
Operating Expenses
Operations and support		9,948		10,104		(1.5)	%		29,511		29,603		(0.3)	%
Depreciation and amortization		2,011		2,057		(2.2)	%		6,027		6,218		(3.1)	%
Total Operating Expenses		11,959		12,161		(1.7)	%		35,538		35,821		(0.8)	%
Operating Income		5,742		5,574		3.0	%		16,818		16,144		4.2	%
Equity in Net Income (Loss) of Affiliates		-		1		-	%		(1)		-		-	%
Operating  Contribution	$	5,742	$	5,575		3.0	%	$	16,817	$	16,144		4.2	%
Operating Income Margin		32.4	%	31.4	%	100	BP		32.1	%	31.1	%	100	BP
Supplementary Operating Data
Subscribers and connections in thousands
Unaudited								September 30,					Percent
									2019		2018		Change
Mobility Subscribers
Postpaid smartphones									60,306		59,829		0.8	%
Postpaid feature phones and data-centric devices									14,846		16,344		(9.2)	%
Postpaid									75,152		76,173		(1.3)	%
Prepaid									17,740		16,721		6.1	%
Reseller									7,120		8,079		(11.9)	%
Connected Devices									62,288		48,177		29.3	%
Total Mobility Subscribers									162,300		149,150		8.8	%
Postpaid Phone Subscribers									62,812		62,850		(0.1)	%
Total Phone Subscribers									79,462		78,639		1.0	%
	Third Quarter							Nine-Month Period					Percent
		2019		2018					2019		2018		Change
Mobility Net Additions
Postpaid		(217)		(231)		6.1	%		(570)		(105)		-	%
Prepaid		227		570		(60.2)	%		669		1,275		(47.5)	%
Reseller		(231)		(366)		36.9	%		(677)		(1,175)		42.4	%
Connected Devices		3,900		3,459		12.7	%		10,947		9,171		19.4	%
Total Mobility Net Additions		3,679		3,432		7.2	%		10,369		9,166		13.1	%
Postpaid Phone Net Additions		101		67		50.7	%		254		63		-	%
Total Phone Net Additions		255		547		(53.4)	%		780		1,104		(29.3)	%
Postpaid Churn		1.19	%	1.16	%	3	BP		1.14	%	1.08	%	6	BP
Postpaid Phone-Only Churn		0.95	%	0.93	%	2	BP		0.91	%	0.86	%	5	BP

Entertainment Group
Entertainment Group provides video, including over-the-top (OTT) services, broadband and voice communication services primarily to residential customers. This business unit also sells advertising on video distribution platforms.
Entertainment Group Results
Dollars in millions
Unaudited		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Operating Revenues
Video entertainment		$	7,933	$	8,283		(4.2)	%	$	24,042	$	24,681		(2.6)	%
High-speed internet			2,117		2,045		3.5	%		6,296		5,904		6.6	%
Legacy voice and data services			628		739		(15.0)	%		1,969		2,317		(15.0)	%
Other service and equipment			519		522		(0.6)	%		1,586		1,596		(0.6)	%
Total Operating Revenues			11,197		11,589		(3.4)	%		33,893		34,498		(1.8)	%
Operating Expenses
Operations and support			8,797		9,155		(3.9)	%		25,839		26,623		(2.9)	%
Depreciation and amortization			1,316		1,331		(1.1)	%		3,978		3,986		(0.2)	%
Total Operating Expenses			10,113		10,486		(3.6)	%		29,817		30,609		(2.6)	%
Operating Income			1,084		1,103		(1.7)	%		4,076		3,889		4.8	%
Equity in Net Income (Loss) of Affiliates			1		1		-	%		1		(1)		-	%
Operating Contribution		$	1,085	$	1,104		(1.7)	%	$	4,077	$	3,888		4.9	%
Operating Income Margin			9.7	%	9.5	%	20	BP		12.0	%	11.3	%	70	BP
Supplementary Operating Data
Subscribers and connections in thousands
Unaudited									September 30,					Percent
										2019		2018		Change
Video Connections
Premium TV										20,418		23,294		(12.3)	%
AT&T Now										1,145		1,858		(38.4)	%
Total Video Connections										21,563		25,152		(14.3)	%
Broadband Connections
IP										13,739		13,723		0.1	%
DSL										562		718		(21.7)	%
Total Broadband Connections										14,301		14,441		(1.0)	%
Fiber Broadband Connections (included in IP)										3,696		2,504		47.6	%
Voice Connections
Retail Consumer Switched Access Lines										3,467		4,144		(16.3)	%
U-verse Consumer VoIP Connections										3,973		4,757		(16.5)	%
Total Retail Consumer Voice Connections										7,440		8,901		(16.4)	%
		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Video Net Additions
Premium TV1			(1,163)		(346)		-	%		(2,485)		(795)		-	%
AT&T Now			(195)		49		-	%		(446)		703		-	%
Total Video Net Additions			(1,358)		(297)		-	%		(2,931)		(92)		-	%
Broadband Net Additions
IP			(83)		31		-	%		10		261		(96.2)	%
DSL			(36)		(45)		20.0	%		(118)		(170)		30.6	%
Total Broadband Net Additions			(119)		(14)		-	%		(108)		91		-	%
Fiber Broadband Net Additions (included in IP)			318		300		6.0	%		933		775		20.4	%
1	Includes the impact of customers that migrated to AT&T Now.

Business Wireline
Business Wireline unit provides advanced IP-based services, as well as traditional data services to business customers. Results have been recast to conform to the current period's presentation.
Business Wireline Results
Dollars in millions
Unaudited		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Operating Revenues
	Strategic and managed services	$	3,900	$	3,677		6.1	%	$	11,513	$	10,849		6.1	%
	Legacy voice and data services		2,252		2,602		(13.5)	%		6,973		8,176		(14.7)	%
	Other service and equipment		351		404		(13.1)	%		1,102		1,010		9.1	%
Total Operating Revenues			6,503		6,683		(2.7)	%		19,588		20,035		(2.2)	%
Operating Expenses
Operations and support			4,022		4,022		-	%		12,029		12,047		(0.1)	%
Depreciation and amortization			1,271		1,187		7.1	%		3,735		3,520		6.1	%
Total Operating Expenses			5,293		5,209		1.6	%		15,764		15,567		1.3	%
Operating Income			1,210		1,474		(17.9)	%		3,824		4,468		(14.4)	%
Equity in Net Income (Loss) of Affiliates			(1)		(3)		66.7	%		-		(2)		-	%
Operating Contribution		$	1,209	$	1,471		(17.8)	%	$	3,824	$	4,466		(14.4)	%
Operating Income Margin			18.6	%	22.1	%	(350)	BP		19.5	%	22.3	%	(280)	BP

Business Solutions
As a supplemental presentation to our Communications segment operating results, we are providing a view of our AT&T Business Solutions results which includes both wireless and fixed operations. This combined view presents a complete profile of the entire business customer relationship and underscores the importance of mobile solutions to serving our business customers. Results have been recast to conform to the current period's presentation.
Business Solutions Results
Dollars in millions
Unaudited		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Operating Revenues
	Wireless service	$	2,009	$	1,857		8.2	%	$	5,901	$	5,440		8.5	%
	Strategic and managed services		3,900		3,677		6.1	%		11,513		10,849		6.1	%
	Legacy voice and data services		2,252		2,602		(13.5)	%		6,973		8,176		(14.7)	%
	Other service and equipment		351		404		(13.1)	%		1,102		1,010		9.1	%
	Wireless equipment		694		586		18.4	%		1,902		1,737		9.5	%
Total Operating Revenues			9,206		9,126		0.9	%		27,391		27,212		0.7	%
Operating Expenses
Operations and support			5,643		5,575		1.2	%		16,770		16,724		0.3	%
Depreciation and amortization			1,573		1,485		5.9	%		4,643		4,408		5.3	%
Total Operating Expenses			7,216		7,060		2.2	%		21,413		21,132		1.3	%
Operating Income			1,990		2,066		(3.7)	%		5,978		6,080		(1.7)	%
Equity in Net Income (Loss) of Affiliates			(1)		(3)		66.7	%		-		(2)		-	%
Operating Contribution		$	1,989	$	2,063		(3.6)	%	$	5,978	$	6,078		(1.6)	%
Operating Income Margin			21.6	%	22.6	%	(100)	BP		21.8	%	22.3	%	(50)	BP

WARNERMEDIA  SEGMENT
The WarnerMedia segment develops, produces and distributes feature films, television, gaming and other content in various physical and digital formats globally. Results from Turner, Home Box Office and Warner Bros. businesses are combined with AT&T's Regional Sports Network (RSN) and Otter Media Holdings in the WarnerMedia segment.
Segment Results
Dollars in millions
Unaudited		Third Quarter				Percent		Nine-Month Period				Percent
			2019		2018	Change			2019		2018	Change
Segment Operating Revenues
	Turner	$	3,007	$	2,988	0.6	%	$	9,860	$	3,767	-	%
	HBO		1,819		1,644	10.6	%		5,045		1,925	-	%
	Warner Bros.		3,333		3,720	(10.4)	%		10,240		4,227	-	%
	Eliminations and other		(313)		(148)	-	%		(570)		(210)	-	%
Total Segment Operating Revenues			7,846		8,204	(4.4)	%		24,575		9,709	-	%
Segment Operating Contribution
	Turner		1,489		1,449	2.8	%		3,926		1,802	-	%
	HBO		724		630	14.9	%		1,894		734	-	%
	Warner Bros.		563		553	1.8	%		1,556		642	-	%
	Eliminations and other		(232)		(104)	-	%		(497)		(186)	-	%
Total Segment Operating Contribution		$	2,544	$	2,528	0.6	%	$	6,879	$	2,992	-	%

Turner
Turner is comprised of the WarnerMedia businesses managed by Turner as well as our RSN. This business unit creates and programs branded news, entertainment, sports and kids multi-platform content that is sold to various distribution affiliates. Turner also sells advertising on its networks and digital properties.
Turner Results
Dollars in millions
Unaudited		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Operating Revenues
	Subscription	$	1,927	$	1,855		3.9	%	$	5,835	$	2,363		-	%
	Advertising		913		944		(3.3)	%		3,440		1,181		-	%
	Content and other		167		189		(11.6)	%		585		223		-	%
Total Operating Revenues			3,007		2,988		0.6	%		9,860		3,767		-	%
Operating Expenses
Operations and support			1,460		1,487		(1.8)	%		5,813		1,933		-	%
Depreciation and amortization			68		59		15.3	%		167		71		-	%
Total Operating Expenses			1,528		1,546		(1.2)	%		5,980		2,004		-	%
Operating Income			1,479		1,442		2.6	%		3,880		1,763		-	%
Equity in Net Income of Affiliates			10		7		42.9	%		46		39		17.9	%
Operating Contribution		$	1,489	$	1,449		2.8	%	$	3,926	$	1,802		-	%
Operating Income Margin			49.2	%	48.3	%	90	BP		39.4	%	46.8	%	(740)	BP

Home Box Office
Home Box Office consists of premium pay television and OTT services domestically and premium pay, basic tier television and OTT services internationally, as well as content licensing and home entertainment
Home Box Office Results
Dollars in millions
Unaudited		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Operating Revenues
	Subscription	$	1,533	$	1,517		1.1	%	$	4,383	$	1,787		-	%
	Content and other		286		127		-	%		662		138		-	%
Total Operating Revenues			1,819		1,644		10.6	%		5,045		1,925		-	%
Operating Expenses
Operations and support			1,072		991		8.2	%		3,124		1,162		-	%
Depreciation and amortization			33		25		32.0	%		67		30		-	%
Total Operating Expenses			1,105		1,016		8.8	%		3,191		1,192		-	%
Operating Income			714		628		13.7	%		1,854		733		-	%
Equity in Net Income of Affiliates			10		2		-	%		40		1		-	%
Operating Contribution		$	724	$	630		14.9	%	$	1,894	$	734		-	%
Operating Income Margin			39.3	%	38.2	%	110	BP		36.7	%	38.1	%	(140)	BP

Warner Bros.
Warner Bros. consists of the production, distribution and licensing of television programming and feature films, the distribution of home entertainment products and the production and distribution of games.
Warner Bros. Results
Dollars in millions
Unaudited		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Operating Revenues
	Theatrical product	$	1,375	$	1,694		(18.8)	%	$	4,408	$	1,917		-	%
	Television product		1,461		1,591		(8.2)	%		4,384		1,794		-	%
	Video games and other		497		435		14.3	%		1,448		516		-	%
Total Operating Revenues			3,333		3,720		(10.4)	%		10,240		4,227		-	%
Operating Expenses
Operations and support			2,706		3,104		(12.8)	%		8,543		3,507		-	%
Depreciation and amortization			39		40		(2.5)	%		122		54		-	%
Total Operating Expenses			2,745		3,144		(12.7)	%		8,665		3,561		-	%
Operating Income			588		576		2.1	%		1,575		666		-	%
Equity in Net Income (Loss) of Affiliates			(25)		(23)		(8.7)	%		(19)		(24)		20.8	%
Operating Contribution		$	563	$	553		1.8	%	$	1,556	$	642		-	%
Operating Income Margin			17.6	%	15.5	%	210	BP		15.4	%	15.8	%	(40)	BP

LATIN AMERICA SEGMENT
The Latin America segment provides entertainment and wireless service outside of the U.S. Our international subsidiaries conduct business in their local currency and operating results are converted to U.S. dollars using official exchange rates. The Latin America segment contains two business units: Vrio and Mexico.
Segment Results
Dollars in millions
Unaudited		Third Quarter				Percent		Nine-Month Period				Percent
			2019		2018	Change			2019		2018	Change
Segment Operating Revenues
	Vrio	$	1,013	$	1,102	(8.1)	%	$	3,112	$	3,710	(16.1)	%
	Mexico		717		731	(1.9)	%		2,093		2,099	(0.3)	%
Total Segment Operating Revenues			1,730		1,833	(5.6)	%		5,205		5,809	(10.4)	%
Segment Operating Contribution
	Vrio		13		66	(80.3)	%		43		281	(84.7)	%
	Mexico		(179)		(267)	33.0	%		(591)		(743)	20.5	%
Total Segment Operating Contribution		$	(166)	$	(201)	17.4	%	$	(548)	$	(462)	(18.6)	%

Mexico
Mexico provides wireless services and equipment to customers in Mexico.
Mexico Results
Dollars in millions
Unaudited		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Operating Revenues
Wireless service		$	455	$	440		3.4	%	$	1,376	$	1,261		9.1	%
Wireless equipment			262		291		(10.0)	%		717		838		(14.4)	%
Total Operating Revenues			717		731		(1.9)	%		2,093		2,099		(0.3)	%
Operating Expenses
Operations and support			774		869		(10.9)	%		2,312		2,459		(6.0)	%
Depreciation and amortization			122		129		(5.4)	%		372		383		(2.9)	%
Total Operating Expenses			896		998		(10.2)	%		2,684		2,842		(5.6)	%
Operating Income (Loss)			(179)		(267)		33.0	%		(591)		(743)		20.5	%
Equity in Net Income of Affiliates			-		-		-	%		-		-		-	%
Operating Contribution		$	(179)	$	(267)		33.0	%	$	(591)	$	(743)		20.5	%
Operating Income Margin			(25.0)	%	(36.5)	%	1,150	BP		(28.2)	%	(35.4)	%	720	BP
Supplementary Operating Data
Subscribers and connections in thousands
Unaudited									September 30,					Percent
										2019		2018		Change
Mexico Wireless Subscribers1
Postpaid										5,352		5,822		(8.1)	%
Prepaid										12,848		11,270		14.0	%
Reseller										419		213		96.7	%
Total Mexico Wireless Subscribers										18,619		17,305		7.6	%
		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Mexico Wireless Net Additions
Postpaid			(137)		73		-	%		(359)		324		-	%
Prepaid			668		802		(16.7)	%		1,183		1,873		(36.8)	%
Reseller			67		32		-	%		166		9		-	%
Total Mexico Wireless Net Subscriber Additions			598		907		(34.1)	%		990		2,206		(55.1)	%
1	2019 excludes the impact of 692 subscriber disconnections resulting from the churn of customers related to sales by certain
	third-party distributors and the sunset of 2G services in Mexico, which are reflected in beginning of period subscribers.

Vrio
Vrio provides entertainment services to customers utilizing satellite technology in Latin America and the Caribbean.
Vrio Results
Dollars in millions
Unaudited		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Operating Revenues		$	1,013	$	1,102		(8.1)	%	$	3,112	$	3,710		(16.1)	%
Operating Expenses
Operations and support			851		877		(3.0)	%		2,598		2,894		(10.2)	%
Depreciation and amortization			162		168		(3.6)	%		496		559		(11.3)	%
Total Operating Expenses			1,013		1,045		(3.1)	%		3,094		3,453		(10.4)	%
Operating Income			-		57		-	%		18		257		(93.0)	%
Equity in Net Income of Affiliates			13		9		44.4	%		25		24		4.2	%
Operating Contribution		$	13	$	66		(80.3)	%	$	43	$	281		(84.7)	%
Operating Income Margin			-	%	5.2	%	(520)	BP		0.6	%	6.9	%	(630)	BP
Supplementary Operating Data
Subscribers and connections in thousands
Unaudited									September 30,					Percent
										2019		2018		Change
Vrio Video Subscribers1										13,306		13,640		(2.4)	%
		Third Quarter					Percent		Nine-Month Period					Percent
			2019		2018		Change			2019		2018		Change
Vrio Video Net Subscriber Additions			(167)		(73)		-	%		(310)		52		-	%
1	2019 excludes the impact of 222 subscriber disconnections resulting from conforming our video credit policy across the region,
	which is reflected in beginning of period subscribers.

XANDR SEGMENT
The Xandr segment provides advertising services. These services utilize data insights to develop higher value targeted advertising. Certain revenues in this segment are also reported by the Communications segment and are eliminated upon consolidation.
Segment Operating Results
Dollars in millions
Unaudited	Third Quarter					Percent		Nine-Month Period					Percent
		2019		2018		Change			2019		2018		Change
Segment Operating Revenues	$	504	$	445		13.3	%	$	1,415	$	1,174		20.5	%
Segment Operating Expenses
Operations and support		162		109		48.6	%		469		218		-	%
Depreciation and amortization		15		3		-	%		41		4		-	%
Total Segment Operating Expenses		177		112		58.0	%		510		222		-	%
Operating Income		327		333		(1.8)	%		905		952		(4.9)	%
Equity in Net Income of Affiliates		-		-		-	%		-		-		-	%
Segment Operating Contribution	$	327	$	333		(1.8)	%	$	905	$	952		(4.9)	%
Segment Operating Income Margin		64.9	%	74.8	%	(990)	BP		64.0	%	81.1	%	(1,710)	BP

Supplemental AT&T Advertising Revenues
As a supplemental presentation to our Xandr segment operating results, we are providing a view of total advertising revenues generated by AT&T, which combines the advertising revenues recorded across all operating segments. This combined view presents the entire portfolio of revenues generated from AT&T assets and represents a significant strategic initiative and growth opportunity for AT&T.
Advertising Revenues
Dollars in millions
Unaudited		Third Quarter				Percent		Nine-Month Period				Percent
			2019		2018	Change			2019		2018	Change
Operating Revenues
	WarnerMedia	$	945	$	983	(3.9)	%	$	3,509	$	1,222	-	%
	Communications		495		478	3.6	%		1,382		1,284	7.6	%
	Xandr		504		445	13.3	%		1,415		1,174	20.5	%
	Eliminations		(421)		(401)	(5.0)	%		(1,170)		(1,122)	(4.3)	%
Total Advertising Revenues		$	1,523	$	1,505	1.2	%	$	5,136	$	2,558	-	%

SUPPLEMENTAL SEGMENT RECONCILIATION
Three Months Ended
Dollars in millions
Unaudited
September 30, 2019
		Revenues		Operations and Support Expenses		EBITDA		Depreciation and Amortization		Operating Income (Loss)		Equity in Net Income (Loss) of Affiliates		Segment Contribution
Communications
Mobility	$	17,701	$	9,948	$	7,753	$	2,011	$	5,742	$	-	$	5,742
Entertainment Group		11,197		8,797		2,400		1,316		1,084		1		1,085
Business Wireline		6,503		4,022		2,481		1,271		1,210		(1)		1,209
Total Communications		35,401		22,767		12,634		4,598		8,036		-		8,036
WarnerMedia
Turner		3,007		1,460		1,547		68		1,479		10		1,489
Home Box Office		1,819		1,072		747		33		714		10		724
Warner Bros.		3,333		2,706		627		39		588		(25)		563
Eliminations and other		(313)		(71)		(242)		10		(252)		20		(232)
Total WarnerMedia		7,846		5,167		2,679		150		2,529		15		2,544
Latin America
Vrio		1,013		851		162		162		-		13		13
Mexico		717		774		(57)		122		(179)		-		(179)
Total Latin America		1,730		1,625		105		284		(179)		13		(166)
Xandr		504		162		342		15		327		-		327
Segment Total		45,481		29,721		15,760		5,047		10,713	$	28	$	10,741
Corporate and Other
Corporate		407		703		(296)		131		(427)
Acquisition-related items		-		190		(190)		1,771		(1,961)
Certain significant items		-		39		(39)		-		(39)
Eliminations and consolidations		(1,300)		(915)		(385)		-		(385)
AT&T Inc.	$	44,588	$	29,738	$	14,850	$	6,949	$	7,901
September 30, 2018
		Revenues		Operations and Support Expenses		EBITDA		Depreciation and Amortization		Operating Income (Loss)		Equity in Net Income (Loss) of Affiliates		Segment Contribution
Communications
Mobility	$	17,735	$	10,104	$	7,631	$	2,057	$	5,574	$	1	$	5,575
Entertainment Group		11,589		9,155		2,434		1,331		1,103		1		1,104
Business Wireline		6,683		4,022		2,661		1,187		1,474		(3)		1,471
Total Communications		36,007		23,281		12,726		4,575		8,151		(1)		8,150
WarnerMedia
Turner		2,988		1,487		1,501		59		1,442		7		1,449
Home Box Office		1,644		991		653		25		628		2		630
Warner Bros.		3,720		3,104		616		40		576		(23)		553
Eliminations and other		(148)		(79)		(69)		10		(79)		(25)		(104)
Total WarnerMedia		8,204		5,503		2,701		134		2,567		(39)		2,528
Latin America
Vrio		1,102		877		225		168		57		9		66
Mexico		731		869		(138)		129		(267)		-		(267)
Total Latin America		1,833		1,746		87		297		(210)		9		(201)
Xandr		445		109		336		3		333		-		333
Segment Total		46,489		30,639		15,850		5,009		10,841	$	(31)	$	10,810
Corporate and Other
Corporate		531		141		390		829		(439)
Acquisition-related items		-		362		(362)		2,329		(2,691)
Certain significant items		-		75		(75)		-		(75)
Eliminations and consolidations		(1,281)		(913)		(368)		(1)		(367)
AT&T Inc.	$	45,739	$	30,304	$	15,435	$	8,166	$	7,269

SUPPLEMENTAL SEGMENT RECONCILIATION
Nine Months Ended
Dollars in millions
Unaudited
September 30, 2019
		Revenues		Operations and Support Expenses		EBITDA		Depreciation and Amortization		Operating Income (Loss)		Equity in Net Income (Loss) of Affiliates		Segment Contribution
Communications
Mobility	$	52,356	$	29,511	$	22,845	$	6,027	$	16,818	$	(1)	$	16,817
Entertainment Group		33,893		25,839		8,054		3,978		4,076		1		4,077
Business Wireline		19,588		12,029		7,559		3,735		3,824		-		3,824
Total Communications		105,837		67,379		38,458		13,740		24,718		-		24,718
WarnerMedia
Turner		9,860		5,813		4,047		167		3,880		46		3,926
Home Box Office		5,045		3,124		1,921		67		1,854		40		1,894
Warner Bros.		10,240		8,543		1,697		122		1,575		(19)		1,556
Eliminations and other		(570)		(31)		(539)		28		(567)		70		(497)
Total WarnerMedia		24,575		17,449		7,126		384		6,742		137		6,879
Latin America
Vrio		3,112		2,598		514		496		18		25		43
Mexico		2,093		2,312		(219)		372		(591)		-		(591)
Total Latin America		5,205		4,910		295		868		(573)		25		(548)
Xandr		1,415		469		946		41		905		-		905
Segment Total		137,032		90,207		46,825		15,033		31,792	$	162	$	31,954
Corporate and Other
Corporate		1,290		2,129		(839)		505		(1,344)
Acquisition-related items		(72)		579		(651)		5,719		(6,370)
Certain significant items		-		381		(381)		-		(381)
Eliminations and consolidations		(3,878)		(2,814)		(1,064)		(1)		(1,063)
AT&T Inc.	$	134,372	$	90,482	$	43,890	$	21,256	$	22,634
September 30, 2018
		Revenues		Operations and Support Expenses		EBITDA		Depreciation and Amortization		Operating Income (Loss)		Equity in Net Income (Loss) of Affiliates		Segment Contribution
Communications
Mobility	$	51,965	$	29,603	$	22,362	$	6,218	$	16,144	$	-	$	16,144
Entertainment Group		34,498		26,623		7,875		3,986		3,889		(1)		3,888
Business Wireline		20,035		12,047		7,988		3,520		4,468		(2)		4,466
Total Communications		106,498		68,273		38,225		13,724		24,501		(3)		24,498
WarnerMedia
Turner		3,767		1,933		1,834		71		1,763		39		1,802
Home Box Office		1,925		1,162		763		30		733		1		734
Warner Bros.		4,227		3,507		720		54		666		(24)		642
Eliminations and other		(210)		(106)		(104)		11		(115)		(71)		(186)
Total WarnerMedia		9,709		6,496		3,213		166		3,047		(55)		2,992
Latin America
Vrio		3,710		2,894		816		559		257		24		281
Mexico		2,099		2,459		(360)		383		(743)		-		(743)
Total Latin America		5,809		5,353		456		942		(486)		24		(462)
Xandr		1,174		218		956		4		952		-		952
Segment Total		123,190		80,340		42,850		14,836		28,014	$	(34)	$	27,980
Corporate and Other
Corporate		1,636		1,832		(196)		1,034		(1,230)
Acquisition-related items		-		750		(750)		4,669		(5,419)
Certain significant items		-		407		(407)		-		(407)
Eliminations and consolidations		(2,063)		(1,040)		(1,023)		(1)		(1,022)
AT&T Inc.	$	122,763	$	82,289	$	40,474	$	20,538	$	19,936

EX-99.3

Discussion and Reconciliation of Non-GAAP Measures

Supplemental Operational Measures

We provide a supplemental discussion of our business solutions operations that is calculated by combining our Mobility and Business Wireline operating units, and then adjusting to remove non-business operations. The following table presents a reconciliation of our supplemental Business Solutions results.

Supplemental Operational Measure
		Third Quarter
		September 30, 2019								September 30, 2018
		Mobility		Business Wireline		Adjustments1		Business Solutions		Mobility		Business Wireline		Adjustments1		Business Solutions
Operating Revenues
Wireless service	$	13,930	$	-	$	(11,921)	$	2,009	$	13,828	$	-	$	(11,971)	$	1,857
Strategic and managed services		-		3,900		-		3,900		-		3,677		-		3,677
Legacy voice and data services		-		2,252		-		2,252		-		2,602		-		2,602
Other services and equipment		-		351		-		351		-		404		-		404
Wireless equipment		3,771		-		(3,077)		694		3,907		-		(3,321)		586
Total Operating Revenues		17,701		6,503		(14,998)		9,206		17,735		6,683		(15,292)		9,126
Operating Expenses
Operations and support		9,948		4,022		(8,327)		5,643		10,104		4,022		(8,551)		5,575
EBITDA		7,753		2,481		(6,671)		3,563		7,631		2,661		(6,741)		3,551
Depreciation and amortization		2,011		1,271		(1,709)		1,573		2,057		1,187		(1,759)		1,485
Total Operating Expenses		11,959		5,293		(10,036)		7,216		12,161		5,209		(10,310)		7,060
Operating Income		5,742		1,210		(4,962)		1,990		5,574		1,474		(4,982)		2,066
Equity in Net Income (Loss) of Affiliates		-		(1)		-		(1)		1		(3)		(1)		(3)
Operating Contribution	$	5,742	$	1,209	$	(4,962)	$	1,989	$	5,575	$	1,471	$	(4,983)	$	2,063
1 Non-business wireless reported in the Communication segment under the Mobility business unit.
Supplemental Operational Measure
		Nine-Month Period
		September 30, 2019								September 30, 2018
		Mobility		Business Wireline		Adjustments1		Business Solutions		Mobility		Business Wireline		Adjustments1		Business Solutions
Operating Revenues
Wireless service	$	41,383	$	-	$	(35,482)	$	5,901	$	40,594	$	-	$	(35,154)	$	5,440
Strategic and managed services		-		11,513		-		11,513		-		10,849		-		10,849
Legacy voice and data services		-		6,973		-		6,973		-		8,176		-		8,176
Other services and equipment		-		1,102		-		1,102		-		1,010		-		1,010
Wireless equipment		10,973		-		(9,071)		1,902		11,371		-		(9,634)		1,737
Total Operating Revenues		52,356		19,588		(44,553)		27,391		51,965		20,035		(44,788)		27,212
Operating Expenses
Operations and support		29,511		12,029		(24,770)		16,770		29,603		12,047		(24,926)		16,724
EBITDA		22,845		7,559		(19,783)		10,621		22,362		7,988		(19,862)		10,488
Depreciation and amortization		6,027		3,735		(5,119)		4,643		6,218		3,520		(5,330)		4,408
Total Operating Expenses		35,538		15,764		(29,889)		21,413		35,821		15,567		(30,256)		21,132
Operating Income		16,818		3,824		(14,664)		5,978		16,144		4,468		(14,532)		6,080
Equity in Net Income (Loss) of Affiliates		(1)		-		1		-		-		(2)		-		(2)
Operating Contribution	$	16,817	$	3,824	$	(14,663)	$	5,978	$	16,144	$	4,466	$	(14,532)	$	6,078
1 Non-business wireless reported in the Communication segment under the Mobility business unit.

XML

Document and Entity Information	Oct. 28, 2019
Entity Listings [Line Items]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Oct. 28, 2019
Entity Registrant Name	AT&T INC.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-08610
Entity Tax Identification Number	43-1301883
Entity Address, Address Line One	208 S. Akard St.
Entity Address, City or Town	Dallas
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75202
City Area Code	210
Local Phone Number	821-4105
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Entity Central Index Key	0000732717
Common Stock [Member]
Entity Listings [Line Items]
Title of 12(b) Security	Common Shares (Par Value $1.00 Per Share)
Trading Symbol	T
Security Exchange Name	NYSE
AT&T Inc. Floating Rate Global Notes due August 3, 2020 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. Floating Rate Global Notes due August 3, 2020
Trading Symbol	T 20C
Security Exchange Name	NYSE
AT&T Inc. 1.875% Global Notes due December 4, 2020 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 1.875% Global Notes due December 4, 2020
Trading Symbol	T 20
Security Exchange Name	NYSE
AT&T Inc. 2.50% Global Notes due March 15, 2023 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 2.50% Global Notes due March 15, 2023
Trading Symbol	T 23
Security Exchange Name	NYSE
AT&T Inc. 1.45% Global Notes due June 1, 2022 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 1.45% Global Notes due June 1, 2022
Trading Symbol	T 22B
Security Exchange Name	NYSE
AT&T Inc. 2.65% Global Notes due December 17, 2021 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 2.65% Global Notes due December 17, 2021
Trading Symbol	T 21B
Security Exchange Name	NYSE
AT&T Inc. 2.75% Global Notes due May 19, 2023 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 2.75% Global Notes due May 19, 2023
Trading Symbol	T 23C
Security Exchange Name	NYSE
AT&T Inc. 2.60% Global Notes due December 17, 2029 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 2.60% Global Notes due December 17, 2029
Trading Symbol	T 29A
Security Exchange Name	NYSE
AT&T Inc. 2.40% Global Notes due March 15, 2024 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 2.40% Global Notes due March 15, 2024
Trading Symbol	T 24A
Security Exchange Name	NYSE
AT&T Inc. 5.20% Global Notes due November 18, 2033 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 5.20% Global Notes due November 18, 2033
Trading Symbol	T 33
Security Exchange Name	NYSE
AT&T Inc. 1.80% Global Notes due September 5, 2026 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 1.80% Global Notes due September 5, 2026
Trading Symbol	T 26D
Security Exchange Name	NYSE
AT&T Inc. 3.375% Global Notes due March 15, 2034 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 3.375% Global Notes due March 15, 2034
Trading Symbol	T 34
Security Exchange Name	NYSE
AT&T Inc. 4.25% Global Notes due June 1, 2043 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 4.25% Global Notes due June 1, 2043
Trading Symbol	T 43
Security Exchange Name	NYSE
AT&T Inc. 7.00% Global Notes due April 30, 2040 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 7.00% Global Notes due April 30, 2040
Trading Symbol	T 40
Security Exchange Name	NYSE
AT&T Inc. 1.800% Global Notes due September 14, 2039 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 1.800% Global Notes due September 14, 2039
Trading Symbol	T 39B
Security Exchange Name	NYSE
AT&T Inc. 1.95% Global Notes due September 15, 2023 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 1.95% Global Notes due September 15, 2023
Trading Symbol	T 23F
Security Exchange Name	NYSE
AT&T Inc. 1.05% Global Notes due September 5, 2023 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 1.05% Global Notes due September 5, 2023
Trading Symbol	T 23E
Security Exchange Name	NYSE
AT&T Inc. 2.35% Global Notes due September 5, 2029 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 2.35% Global Notes due September 5, 2029
Trading Symbol	T 29D
Security Exchange Name	NYSE
AT&T Inc. 0.250% Global Notes due March 4, 2026 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 0.250% Global Notes due March 4, 2026
Trading Symbol	T 26E
Security Exchange Name	NYSE
AT&T Inc. Floating Rate Global Notes due September 5, 2023 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. Floating Rate Global Notes due September 5, 2023
Trading Symbol	T 23D
Security Exchange Name	NYSE
AT&T Inc. 4.375% Global Notes due September 14, 2029 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 4.375% Global Notes due September 14, 2029
Trading Symbol	T 29B
Security Exchange Name	NYSE
AT&T Inc. 5.625% Global Notes due August 1, 2067 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 5.625% Global Notes due August 1, 2067
Trading Symbol	TBC
Security Exchange Name	NYSE
AT&T Inc. 0.800% Global Notes due March 4, 2030 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 0.800% Global Notes due March 4, 2030
Trading Symbol	T 30B
Security Exchange Name	NYSE
AT&T Inc. 3.55% Global Notes due December 17, 2032 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 3.55% Global Notes due December 17, 2032
Trading Symbol	T 32
Security Exchange Name	NYSE
AT&T Inc. 2.45% Global Notes due March 15, 2035 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 2.45% Global Notes due March 15, 2035
Trading Symbol	T 35
Security Exchange Name	NYSE
AT&T Inc. 3.15% Global Notes due September 4, 2036 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 3.15% Global Notes due September 4, 2036
Trading Symbol	T 36A
Security Exchange Name	NYSE
AT&T Inc. 4.875% Global Notes due June 1, 2044 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 4.875% Global Notes due June 1, 2044
Trading Symbol	T 44
Security Exchange Name	NYSE
AT&T Inc. 5.35% Global Notes due November 1, 2066 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 5.35% Global Notes due November 1, 2066
Trading Symbol	TBB
Security Exchange Name	NYSE
AT&T Inc. 2.90% Global Notes due December 4, 2026 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 2.90% Global Notes due December 4, 2026
Trading Symbol	T 26A
Security Exchange Name	NYSE
AT&T Inc. 1.30% Global Notes due September 5, 2023 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 1.30% Global Notes due September 5, 2023
Trading Symbol	T 23A
Security Exchange Name	NYSE
AT&T Inc. 3.50% Global Notes due December 17, 2025 [Member]
Entity Listings [Line Items]
Title of 12(b) Security	AT&T Inc. 3.50% Global Notes due December 17, 2025
Trading Symbol	T 25
Security Exchange Name	NYSE