EX-99.4 5 t-1q2022exhibit994.htm EX-99.4 SUPPLEMENTAL QUARTERLY FINANCIAL INFORMATION EXCLUDING VIDEO AND VRIO Document

Quarterly Financial Information Excluding Video (US & Vrio)
Supplemental Unaudited Quarterly Financial Information1
Dollars in millions
Unaudited
Operating Revenues3/31/216/30/219/30/2112/31/21 2021 3/31/22
Reported AT&T Operating Revenues$43,939 $44,045 $39,922 $40,958 $168,864 $38,105 
Less: Video (A1)(6,725)(6,639)(2,149)— (15,513)— 
Add: WarnerMedia sales to Video (A2)524 508 167 — 1,199 — 
Add: WarnerMedia sales of DIRECTV advertising inventory (A3)388 410 111 — 909 — 
Add: Other eliminations61 58 17 — 136 — 
Less: Vrio (A4)(743)(749)(756)(359)(2,607)— 
Add: WarnerMedia sales to Vrio (A5)64 65 63 30 222 — 
Operating Revenues excluding Video$37,508 $37,698 $37,375 $40,629 $153,210 $38,105 
Reported Revenue Growth Rate Y/Y-13.3 %
Revenue excluding Video Growth Rate Y/Y1.6 %


Operations and Support Expenses3/31/216/30/219/30/2112/31/2120213/31/22
Reported AT&T Operations and Support Expenses$30,469 $35,015 $27,194 $29,977 $122,655 $26,925 
Adjustments (B1)(61)(4,484)(288)(300)(5,133)(458)
Adjusted Operations and Support Expenses30,408 30,531 26,906 29,677 117,522 26,467 
Less: Video (A1)(5,660)(5,275)(1,731)— (12,666)— 
Add: WarnerMedia sales to Video (A2)524 508 167 — 1,199 — 
Add: WarnerMedia sales of DIRECTV advertising inventory (A3)39 38 12 — 89 — 
Add: WarnerMedia/DIRECTV 70% revenue share (A3)271 287 78 — 636 — 
Add: Other eliminations61 58 17 — 136 — 
Less: Vrio (A4)(661)(660)(660)(321)(2,302)— 
Add: WarnerMedia sales to Vrio (A5)64 65 63 30 222 — 
Less: Reclassification of allocations for separated businesses15 17 14 9 55 — 
Add: DTV-related retained costs350 350 117 — 817 — 
Adjusted Operations and Support Expenses excluding Video$25,411 $25,919 $24,983 $29,395 $105,708 $26,467 
Reported Operations and Support Expense Growth Rate Y/Y-11.6 %
Adjusted Operations and Support Expense Growth Rate Y/Y-13.0 %
Adjusted Operations and Support Expense excluding Video Growth Rate Y/Y4.2 %


Depreciation and Amortization Expense3/31/216/30/219/30/2112/31/2120213/31/22
Reported AT&T Depreciation and Amortization Expense$5,809 $5,761 $5,619 $5,673 $22,862 $5,539 
Adjustments (B1)(1,131)(1,069)(1,012)(1,021)(4,233)(971)
Adjusted Depreciation and Amortization Expense4,678 4,692 4,607 4,652 18,629 4,568 
Less: Video Depreciation (A1)(164)(148)(44)— (356)— 
Less: Vrio Depreciation (A4)(117)(114)— — (231)— 
Add: DTV-related retained costs180 180 60 — 420 — 
Adjusted Depreciation and Amortization Expense excluding Video$4,577 $4,610 $4,623 $4,652 $18,462 $4,568 
Reported Depreciation and Amortization Expense Growth Rate Y/Y-4.6 %
Adjusted Depreciation and Amortization Expense Growth Rate Y/Y-2.4 %
Adjusted Depreciation and Amortization Expense excluding Video Growth Rate Y/Y-0.2 %


Operating Income3/31/216/30/219/30/2112/31/2120213/31/22
Reported AT&T Operating Income (Loss)$7,661 $3,269 $7,109 $5,308 $23,347 $5,641 
Adjustments (B1)1,192 5,553 1,300 1,321 9,366 1,429 
Adjusted Operating Income8,853 8,822 8,409 6,629 32,713 7,070 
Less: Video (A1)(901)(1,216)(374)— (2,491)— 
Add: WarnerMedia sales to Video (A2)— — — — — — 
Add: WarnerMedia sales of DIRECTV advertising inventory (A3)349 372 99 — 820 — 
Add: WarnerMedia/DIRECTV 70% revenue share (A3)(271)(287)(78)— (636)— 
Add: Other eliminations— — — — — — 
Less: Vrio (A4)35 25 (96)(38)(74)— 
Add: WarnerMedia sales to Vrio (A5)— — — — — — 
Less: Reclassification of allocations for separated businesses(15)(17)(14)(9)(55)— 
Add: DTV-related retained costs(530)(530)(177)— (1,237)— 
Adjusted Operating Income excluding Video $7,520 $7,169 $7,769 $6,582 $29,040 $7,070 
Reported Operating Income Growth Rate Y/Y-26.4 %
Adjusted Operating Income Growth Rate Y/Y-20.1 %
Adjusted Operating Income excluding Video Growth Rate Y/Y-6.0 %
Reported Operating Income Margin17.4 %7.4 %17.8 %13.0 %13.8 %14.8 %
Adjusted Operating Income Margin20.1 %20.0 %21.1 %16.2 %19.4 %18.6 %
Adjusted Operating Income excluding Video Margin20.0 %19.0 %20.8 %16.2 %19.0 %18.6 %


EBITDA3/31/216/30/219/30/2112/31/2120213/31/22
Reported AT&T Net Income (Loss)$7,942 $1,874 $6,273 $5,390 $21,479 $5,164 
Additions:
Income Tax Expense (Benefit)2,122 751 1,539 1,056 5,468 1,443 
Interest Expense1,870 1,684 1,667 1,663 6,884 1,722 
Equity in Net Income (Loss) of Affiliates(52)(41)(91)(447)(631)(501)
Other (Income) Expense - net(4,221)(999)(2,279)(2,354)(9,853)(2,187)
Depreciation and amortization5,809 5,761 5,619 5,673 22,862 5,539 
EBITDA13,470 9,030 12,728 10,981 46,209 11,180 
Adjustments (B1)61 4,484 288 300 5,133 458 
Adjusted EBITDA13,531 13,514 13,016 11,281 51,342 11,638 
Less: Video (A1)(1,065)(1,364)(418)— (2,847)— 
Add: WarnerMedia sales to Video (A2)— — — — — — 
Add: WarnerMedia sales of DIRECTV advertising inventory (A3)349 372 99 — 820 — 
Add: WarnerMedia/DIRECTV 70% revenue share (A3)(271)(287)(78)— (636)— 
Add: Other eliminations— — — — — — 
Less: Vrio (A4)(82)(89)(96)(38)(305)— 
Add: WarnerMedia sales to Vrio (A5)— — — — — — 
Less: Reclassification of allocations for separated businesses(15)(17)(14)(9)(55)— 
Add: DTV-related retained costs(350)(350)(117)— (817)— 
Adjusted EBITDA excluding Video $12,097 $11,779 $12,392 $11,234 $47,502 $11,638 
Adjusted EBITDA Growth Rate Y/Y-14.0 %
Adjusted EBITDA excluding Video Growth Rate Y/Y-3.8 %
Adjusted EBITDA Margin30.8 %30.7 %32.6 %27.5 %30.4 %30.5 %
Adjusted EBITDA Margin excluding Video 32.3 %31.2 %33.2 %27.7 %31.0 %30.5 %


1 After the transaction, AT&T expects to retain incurred operations and support costs in the range of ~$500M per quarter and depreciation costs for network infrastructure that provides both U-verse video and broadband services of ~$150M per quarter, of which approximately 50% will be received from DIRECTV through transition service agreements and commercial arrangements.
NOTES
(A) Notes to Adjustments
(A1) Video business results as reported in AT&T's consolidated financial results; quarters ended 2021 exclude retained depreciation on assets supporting U-verse products
(A2) Intercompany transactions between WarnerMedia and Video that are external following the close of the transaction
(A3) DIRECTV's advertising inventory sold by WarnerMedia (Xandr business) pursuant to commercial agreement, with WarnerMedia recording all the advertising revenues and an expense for DIRECTV's 70% revenue share
(A4) Vrio business results as reported in AT&T's consolidated financial results
(A5) Intercompany transactions between WarnerMedia and Vrio that are external following the close of the transaction
(B1) Non-GAAP Adjustments2:
3/31/216/30/219/30/2112/31/2120213/31/22
Merger Costs$37 $— $130 $132 $299 $364 
Employee separation costs and benefit-related (gain) loss24 (71)(3)(20)(70)94 
Impairments— 4,555 161 188 4,904 — 
Gain (loss) on spectrum transaction— — — — — — 
Adjustments to Operations and Support Expenses/ EBITDA61 4,484 288 300 5,133 458 
Amortization of intangibles1,131 1,069 1,012 1,021 4,233 971 
Impairments— — — — — — 
Adjustments to Operating Income$1,192 $5,553 $1,300 $1,321 $9,366 $1,429 
2 As reported in exhibit 99.3 in AT&T's Form 8-K filed April 21, 2002 and exhibit 99.1 to AT&T's Form 8-K filed April 15, 2022.