Revenue Recognition (Tables)

6 Months Ended

Jun. 30, 2022

Revenue from Contract with Customer [Abstract]

Disaggregation of revenue

The following table provides disaggregation of revenue from contracts with customers based on service offering for the six months ended June 30, 2022 and 2021. It also shows the amount of revenue that is not subject to ASC 606, but is instead governed by other accounting standards:

	Three Months Ended June 30, 2022				Three Months Ended June 30, 2021
	Total Revenue		Adjustments for Non-ASC 606 Revenue(1)	Total Revenue from Contracts with Customers	Total Revenue	Adjustments for Non-ASC 606 Revenue(1)	Total Revenue from Contracts with Customers
	(Dollars in millions)
Compute and Application Services	$	283	(126)	157	283	(127)	156
IP and Data Services	883		—	883	888	—	888
Fiber Infrastructure Services	403		(57)	346	401	(55)	346
Voice and Other	327		(4)	323	357	(3)	354
Affiliate Services	57		(57)	—	56	(56)	—
Total revenue	$	1,953	(244)	1,709	1,985	(241)	1,744

	Six Months Ended June 30, 2022				Six Months Ended June 30, 2021
	Total Revenue		Adjustments for Non-ASC 606 Revenue (1)	Total Revenue from Contracts with Customers	Total Revenue	Adjustments for Non-ASC 606 Revenue (1)	Total Revenue from Contracts with Customers
	(Dollars in millions)
Compute and Application Services	$	560	(254)	306	563	(254)	309
IP and Data Services	1,769		—	1,769	1,769	—	1,769
Fiber Infrastructure Services	794		(111)	683	798	(108)	690
Voice and Other	663		(8)	655	733	(5)	728
Affiliate Services	113		(113)	—	111	(111)	—
Total revenue	$	3,899	(486)	3,413	3,974	(478)	3,496

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(1) Includes lease revenue which is not within the scope of ASC 606.

Contract with customer, asset and liability

The following table provides balances of customer receivables, contract assets and contract liabilities, net of amounts reclassified as held for sale as of June 30, 2022 and December 31, 2021:

	June 30, 2022		December 31, 2021
	(Dollars in millions)
Customer receivables (1)	$	577	640
Contract assets (2)	33		35
Contract liabilities (3)	254		247

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(1)Reflects gross customer receivables of $614 million and $679 million, net of allowance for credit losses of $37 million and $39 million, at June 30, 2022 and December 31, 2021, respectively. As of June 30, 2022 and December 31, 2021, these amounts exclude customer receivables reclassified as held for sale of $94 million and $83 million respectively.

(2)As of June 30, 2022 and December 31, 2021, no amounts have been reclassified as held for sale.

(3)As of June 30, 2022 and December 31, 2021, amounts exclude contract liabilities reclassified as held for sale of $59 million and $58 million respectively.

Capitalized contract cost

The following table provides changes in our contract acquisition costs and fulfillment costs:

	Three Months Ended June 30, 2022			Three Months Ended June 30, 2021
	Acquisition Costs		Fulfillment Costs (1)	Acquisition Costs	Fulfillment Costs
	(Dollars in millions)
Beginning of period balance	$	77	100	75	123
Costs incurred	14		22	15	23
Amortization	(13)		(20)	(15)	(22)
Change in contract costs held for sale (1)	—		(1)	—	—
End of period balance	$	78	101	75	124

	Six Months Ended June 30, 2022			Six Months Ended June 30, 2021
	Acquisition Costs		Fulfillment Costs (1)	Acquisition Costs	Fulfillment Costs
	(Dollars in millions)
Beginning of period balance	$	76	99	78	122
Costs incurred	29		43	29	46
Amortization	(27)		(40)	(32)	(44)
Change in contract costs held for sale (1)	—		(1)	—	—
End of period balance	$	78	101	75	124

(1)The beginning balance for both the three and six months ended June 30, 2022 excluded fulfillment costs reclassified as held for sale of $27 million, respectively. The ending balance for June 30, 2022 excluded fulfillment costs reclassified as held for sale of $28 million.