Unaudited Quarterly Financial Data

12 Months Ended

Dec. 31, 2013

Quarterly Financial Information Disclosure [Abstract]

Unaudited Quarterly Financial Data

Unaudited Quarterly Financial Data

	Three Months Ended
	March 31,						June 30,						September 30,						December 31,
	2013			2012			2013			2012			2013			2012			2013		2012
(dollars in millions except per share data)
Revenue	$	1,577		$	1,586		$	1,565		$	1,586		$	1,569		$	1,590		$	1,602	$	1,614
Gross Margin	948			929			949			938			961			948			984		959
Operating Income	155			116			140			133			152			138			219		188
Net Income (Loss)	(78		)	(138		)	(24		)	(62		)	(21		)	(166		)	14		(56		)
Income (Loss) per share (Basic and Diluted)	$	(0.36	)	$	(0.66	)	$	(0.11	)	$	(0.29	)	$	(0.09	)	$	(0.76	)	$	0.06	$	(0.26	)

Loss per share for each quarter is computed using the weighted-average number of shares outstanding during that quarter, while loss per share for the year is computed using the weighted-average number of shares outstanding during the year. Thus, the sum of the loss per share for each of the four quarters may not equal the loss per share for the year.

During the fourth quarter of 2013, the Company recognized a loss on modification and extinguishment of debt of $67 million, including $10 million related to the refinancing of the Tranche B-II 2019 Term Loan, $56 million related to the refinancing of the 10% Senior Notes due 2018 and $1 million related to the refinancing of the Floating Rate Senior Notes due 2015.

During the third quarter of 2013, the Company recognized a loss on modification and extinguishment of debt of $17 million related to the refinancing of the $595.5 million Tranche B 2016 and the $815 million Tranche B 2019 Term Loans.

During the fourth quarter of 2012, the Company recognized a loss on extinguishment of debt of $50 million in connection with the refinancing of the $650 million Tranche B-II Term Loan and $550 million Tranche B-III Term Loan. Additionally in the fourth quarter of 2012, the Company recognized $20 million of restructuring charges.

During the fourth quarter of 2012, the Company completed an updated analysis and revised its estimated future cash flows of its asset retirement obligations as a result of a strategic review of the Company's real estate portfolio. As a result, the Company reduced its asset retirement obligations liability by $73 million with an offsetting reduction to property, plant and equipment of $24 million, selling, general and administrative expenses of $47 million and depreciation and amortization of $2 million. (see Note 4 - Asset Retirement Obligations).

During the third quarter of 2012, the Company recognized a loss on extinguishment of debt of $49 million, including $9 million related to the refinancing of the $1.4 billion Tranche A Term Loan and the repayment of existing vendor financing obligations and $40 million as a result of the redemption of the 8.75% Senior Notes due 2017. Also in the third quarter of 2012, the Company recognized a non-cash loss in "Other, net" of $60 million on interest rate swap agreements that were deemed "ineffective" under GAAP in connection with the refinancing of the $1.4 billion Tranche A Term Loan.

During the first quarter of 2012, the Company recognized a loss on extinguishment of debt of $61 million, including $22 million related to the redemption of the 9.25% Senior Notes due 2014 and $39 million as a result of the exchange of a portion of the 15% Convertible Senior Notes due 2013 for approximately 5.4 million shares of Level 3 common stock.