Property, Plant and Equipment

12 Months Ended

Dec. 31, 2022

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, Plant and Equipment

Net property, plant and equipment is composed of the following:

	Depreciable Lives	As of December 31,
		2022		2021
		(Dollars in millions)
Land	N/A	$	202	305
Fiber conduit and other outside plant (1)	15-45 years	4,133		5,531
Central office and other network electronics (2)	7-10 years	2,977		3,280
Support assets (3)	3-30 years	2,145		2,504
Construction-in-progress (4)	N/A	721		624
Gross property, plant and equipment		10,178		12,244
Accumulated depreciation		(2,875)		(3,202)
Net property, plant and equipment		$	7,303	9,042

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(1)Fiber, conduit and other outside plant consists of fiber and metallic cable, conduit, poles and other supporting structures.

(2)Central office and other network electronics consists of circuit and packet switches, routers, transmission electronics and electronics providing service to customers.

(3)Support assets consist of buildings, data centers, computers and other administrative and support equipment.

(4)Construction in progress includes construction and property of the aforementioned categories that has not been placed in service as it is still under construction.

At December 31, 2022, we classified $1.9 billion of certain property, plant and equipment, net, related to our EMEA business as held for sale and discontinued recording depreciation on this disposal group as of November 2, 2022. At December 31, 2021, we had $1.6 billion of certain property, plant and equipment, net related to our Latin American business classified as held for sale, which was subsequently sold on August 1, 2022. See Note 2—Completed Divestiture of the Latin American Business and Planned Divestiture of European, Middle Eastern and African Business for more information.

Depreciation expense was $790 million, $874 million and $851 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Asset Retirement Obligations

As of December 31, 2022 and 2021, our asset retirement obligations consisted primarily of restoration requirements for leased facilities. We recognize our estimate of the fair value of our asset retirement obligations in the period incurred in other long-term liabilities. The fair value of the asset retirement obligation is also capitalized as property, plant and equipment and then depreciated over the estimated remaining useful life of the associated asset.

The following table provides asset retirement obligation activity:

	Years Ended December 31,
	2022		2021
	(Dollars in millions)
Balance at beginning of period	$	121	122
Accretion expense	5		5
Liabilities settled	(7)		(10)
Change in estimate	(4)		7
Classified as held for sale (1)	(30)		(3)
Balance at end of period	$	85	121

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(1)Represents the amounts classified as held for sale related to our divestitures. See Note 2—Completed Divestiture of the Latin American Business and Planned Divestiture of European, Middle Eastern and African Business.

The changes in estimate referred to in the table above was offset against gross property, plant and equipment.