Transactions with DIRECTV

9 Months Ended

Sep. 30, 2023

Related Party Transactions [Abstract]

Related Party Transactions Disclosure

NOTE 10. TRANSACTIONS WITH DIRECTV

We account for our investment in DIRECTV under the equity method and record our share of DIRECTV earnings as equity in net income of affiliates, with DIRECTV considered a related party.

Our share of DIRECTV’s earnings included in equity in net income of affiliates was $1,334 and $1,429 for the nine months ended September 30, 2023 and 2022, respectively. Cash distributions from DIRECTV for the first nine months of 2023 totaled $2,781, with $1,334 classified as operating activities and $1,447 classified as investing activities in our consolidated statement of cash flows versus total cash distributions of $3,634 ($1,429 operating and $2,205 investing) in the comparable prior period. Our investment in DIRECTV at September 30, 2023 was $1,476.

In February 2023, we repaid all outstanding notes payable to DIRECTV.

We provide DIRECTV with network transport for U-verse products and sales services under commercial arrangements for up to five years. Under separate transition services agreements, we provide DIRECTV certain operational support, including servicing of certain of their customer receivables. For the three and nine months ended September 30, 2023, we billed DIRECTV approximately $160 and $580 for these costs, which were recorded as a reduction to the operations and support expenses incurred and resulted in net retained costs to AT&T of $167 in the third quarter and $514 for the first nine months of 2023.

At September 30, 2023, we had accounts receivable from DIRECTV of $245 and accounts payable to DIRECTV of $40.

We are not committed, implicitly or explicitly to provide financial or other support, other than as noted above, as our involvement with DIRECTV is limited to the carrying amount of the assets and liabilities recognized on our balance sheet.