Form 8-K AT&T INC. For: Mar 31

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April 26, 2016 4:03 PM EDT

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of report (Date of earliest event reported) April 26, 2016

AT&T INC.

(Exact Name of Registrant as Specified in Charter)

Delaware	1-8610	43-1301883
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

208 S. Akard St., Dallas, Texas	75202
(Address of Principal Executive Offices)	(Zip Code)

Registrant's telephone number, including area code (210) 821-4105

__________________________________

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240-14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 8.01 Other Events.

Throughout this document, AT&T Inc. is referred to as "we" or "AT&T." We are a holding company whose subsidiaries and affiliates operate in the communications and digital entertainment services industry. Our subsidiaries and affiliates provide services and equipment that deliver wireless, video and broadband services both domestically and internationally, as well as traditional telephony services.

Overview

We announced on April 26, 2016, that first-quarter 2016 net income attributable to AT&T totaled $3.8 billion, or $0.61 per diluted share, compared to $3.3 billion, or $0.63 per diluted share in the first quarter of 2015.

First-quarter 2016 revenues were $40.5 billion, up 24.4 percent from the first-quarter 2015. First quarter revenues reflect increased revenues primarily from our acquisition of DIRECTV. Compared with results for the first quarter of 2015, operating expenses were $33.4 billion versus $27.0 billion; operating income was $7.1 billion, up from $5.6 billion; and AT&T's operating income margin was 17.6 percent, compared to 17.1 percent. First-quarter 2016 cash from operating activities was $7.9 billion, up from $6.7 billion in the year-ago quarter primarily due to the acquisition of DIRECTV and the timing of working capital payments.

Many of our products, including AT&T Mobility and AT&T U-verse^® (U-verse), are offered to subscribers in multiple segments. Accordingly, to aid in understanding subscriber trends, we are presenting an overall discussion of these customer metrics. We reported a net gain of 2.3 million North American wireless subscribers in the first quarter of 2016, of which 1.8 million were in the U.S. At March 31, 2016, our North American wireless customer base was approximately 139.7 million compared to 127.5 million in the prior year, and our domestic wireless subscribers totaled 130.4 million compared to 121.8 million. During the first quarter, net adds for connected devices were 1.6 million, including 1.2 million connected cars. North American prepaid subscriber net adds were 950,000, with 500,000 in the U.S. due to gains in both Cricket and GoPhone subscribers. North American postpaid subscriber net adds were 245,000, of which 129,000 were domestic. North American reseller had a net loss of 437,000, with 400,000 in the U.S. reflecting losses in session based and low-end subscribers. In the first quarter of 2016, North American branded net adds (combined postpaid and prepaid) were 1.2 million, with 629,000 in the U.S., reflecting gains in prepaid smartphones. Total domestic postpaid tablet and computing device net adds were 344,000 in the first quarter of 2016.

In the first quarter of 2016, we no longer offered subsidized device purchases for the majority of our customers, instead allowing subscribers to purchase devices on installment (AT&T Next) or to bring their own device (BYOD). During the quarter, we also introduced an integrated offer that allows for unlimited wireless data when combined with our video services, ending the quarter with more than 3.0 million subscribers on these packages. At March 31, 2016, Mobile Share plans represented nearly 59.4 million domestic wireless connections and about 68 percent of our domestic wireless postpaid smartphone base was on no-device-subsidy Mobile Share plans. At the end of the quarter, 50.3 million of postpaid smartphone subscribers are on usage-based data plans, compared to 49.4 million a year ago.

Sales under AT&T Next continued to increase during the first quarter, with nearly 80 percent of all postpaid smartphone gross adds and upgrades taking Next, compared to 72 percent in the fourth quarter of 2015 and 65 percent in the first quarter of 2015. During the first quarter of 2016, we sold 4.1 million smartphones under our AT&T Next program and had BYOD gross adds of 556,000. More than 90 percent of smartphone transactions in the quarter were no-subsidy. At March 31, 2016, approximately 49 percent of the postpaid smartphone base is on AT&T Next.

With our July 24, 2015, acquisition of DIRECTV, we added 32.2 million subscribers of DIRECTV's video services, which includes domestic and international subscribers and reflects our methodology used to count commercial subscribers. Total video subscribers declined by 125,000 in the first quarter of 2016. At March 31, 2016, we had 37.8 million video subscribers compared with 6.0 million at March 31, 2015.

Our total broadband connections were 15.8 million at March 31, 2016, and 16.1 million at March 31, 2015. During the first quarter, we added 202,000 IP broadband subscribers, for a total of 13.5 million at March 31, 2016. Total broadband subscribers declined by 14,000 in the quarter.

At March 31, 2016, our total switched access lines were 16.0 million compared with 18.9 million at March 31, 2015. The number of U-verse voice connections (which use VoIP technology and therefore are not included in the access line total) increased by 31,000 in the quarter to reach 5.5 million at March 31, 2016, compared to 5.2 million at March 31, 2015.

Segment Summary

Business Solutions

Revenues from our Business Solutions (ABS) segment for the first quarter of 2016 were $17.6 billion, up 0.3 percent versus the year-ago quarter driven by higher wireless service revenues, largely reflecting migrations from our Consumer Mobility segment, and growth in strategic business services. Revenues were partially offset by continued declines in our legacy voice and data products, lower equipment revenues and foreign exchange pressures. First-quarter 2016 ABS operating expenses totaled $13.3 billion, down 0.8 percent versus the first quarter of 2015, largely due to a decline in handset costs and lower employee and commission expenses. The ABS operating margin was 24.4 percent, compared to 23.6 percent in the year-earlier quarter with wireless and IP revenue growth and cost efficiencies offsetting declines in legacy services.

We had approximately 75.8 million business wireless subscribers at March 31, 2016, compared to 66.9 million at March 31, 2015. During the first quarter of 2016, business wireless net adds for connected devices were 1.6 million and postpaid net adds were 133,000. Postpaid business wireless subscriber churn was 1.02 percent, compared to 0.90 percent in the year-ago quarter.

During the first quarter of 2016, we added 17,000 high-speed Internet business subscribers, bringing total business IP broadband to 928,000 subscribers. Total business broadband connections had a loss of 19,000 subscribers in the quarter.

Entertainment Group

Our Entertainment Group (Entertainment) segment includes the results of the U.S. satellite-based operations acquired in our July 2015 acquisition of DIRECTV as well as broadband and wired voice services to domestic residential customers. Entertainment revenues for the first quarter of 2016 were $12.7 billion, more than double the year-ago quarter due to the acquisition of DIRECTV as well as strong growth in consumer IP broadband. Revenues from legacy voice and data products continue to decline. First-quarter 2016 Entertainment operating expenses totaled $11.1 billion compared to $5.9 billion in the first quarter of 2015, largely due to the acquisition of DIRECTV. The Entertainment operating margin was 12.6 percent, compared to (4.7) percent in the year-earlier quarter with satellite and IP revenue growth and cost efficiencies largely offsetting programming content cost pressure and declines in legacy services.

At March 31, 2016, Entertainment had approximately 51.7 million revenue connections, compared to 34.2 million at March 31, 2015, which included:

Approximately 25.3 million video connections at March 31, 2016, compared to 6.0 million at March 31, 2015. DIRECTV's satellite subscribers as of the July 24, 2015, acquisition date were 19.5 million. During the first quarter, we added 328,000 satellite subscribers; however, U-verse subscribers declined 382,000 as we focused on profitability and increasingly emphasized satellite sales, including U-verse subscribers switching to satellite.

·	Approximately 14.3 million broadband connections at March 31, 2016, compared to 14.5 million at March 31, 2015. During the first quarter, we added 186,000 IP broadband subscribers, for a total of 12.5 million at March 31, 2016. Total broadband subscribers increased 5,000 in the quarter.

·	Approximately 12.1 million wired voice connections at March 31, 2016, compared to 13.7 million at March 31, 2015. Voice connections include switched access lines and VoIP connections.

Consumer Mobility

Revenues from our Consumer Mobility segment, which consist of consumer, wholesale and resale subscribers located in the U.S., for the first quarter of 2016 were $8.3 billion, down 5.1 percent versus the year-ago quarter, reflecting declines in postpaid service revenues due to the success of Mobile Share plans and migrations of customers to our ABS segment and lower equipment revenues, partially offset by higher prepaid service revenues. First-quarter 2016 Consumer Mobility operating expenses totaled $5.8 billion, down 10.8 percent versus the first quarter of 2015. The Consumer Mobility operating margin was 29.9 percent, compared to 25.5 percent in the year-earlier quarter with lower volumes, fewer subsidized sales and cost efficiencies more than offsetting the pressure from customers choosing Mobile Share plans.

We had approximately 54.7 million Consumer Mobility subscribers at March 31, 2016, compared to 54.8 million at March 31, 2015. During the first quarter of 2016, prepaid net adds were 500,000. Consumer postpaid and reseller had net losses of 4,000 and 378,000, respectively. Our business wireless offerings allow for individual subscribers to purchase wireless services through employer-sponsored plans for a reduced price. The migration of these subscribers to the ABS segment negatively impacted consumer postpaid subscriber and service revenues growth.

Total customer churn of Consumer Mobility subscribers was 2.11 percent versus 2.04 percent in the first quarter of 2015, including postpaid churn of 1.24 percent, compared to 1.20 percent in the year-ago quarter.

International

Our International segment consists of the Latin American operations acquired in our July 2015 acquisition of DIRECTV as well as the Mexican wireless operations acquired earlier in 2015. First quarter 2016 operating revenues were $1.7 billion, with $1.1 billion attributable to video services in Latin America and $537 million of wireless revenues in Mexico. First quarter 2015 operating revenues included the results of one of the Mexican companies acquired in 2015 and were $236 million. Our international segment revenues reflect foreign exchange pressures in our DIRECTV Latin America and Mexican wireless results. Operating expenses were $1.9 billion compared to $246 million in the first quarter of 2015. The International operating margin was (11.9) percent, compared to (4.2) percent in the year-earlier quarter.

At March 31, 2016, we had approximately 9.2 million wireless subscribers in Mexico and 12.4 million video connections in Latin America, including 5.3 million in Brazil. During the first quarter of 2016, our Mexico wireless business had net adds of 529,000 subscribers and our Latin America operations had a net loss of 73,000 video connections.

Supplemental Discussion

As a supplemental discussion of our operating results, for comparison purposes, we are providing a view of our combined AT&T Mobility operations (domestic only). AT&T Mobility revenues for the first quarter of 2016 were $18.0 billion, down 1.3 percent versus the first quarter of 2015, and AT&T Mobility's operating income margin was 29.4 percent compared to 25.9 percent in the year-ago quarter reflecting adoption of AT&T Next, an increase in BYOD customers, lower smartphone upgrade volumes and continued efforts to drive operating costs out of the business.

For the quarter ended March 31, 2016, postpaid phone-only ARPU decreased 0.8 percent versus the year-earlier quarter and 0.4 percent sequentially. Postpaid phone-only ARPU plus AT&T Next increased 5.1 percent versus the year earlier quarter and 0.9 percent sequentially.

Postpaid churn was 1.10 percent, compared to 1.02 percent in the year-ago. Total customer churn was 1.42 percent versus 1.40 percent in the first quarter of 2015.

CAUTIONARY LANGUAGE CONCERNING FORWARD-LOOKING STATEMENTS

Information set forth in this filing contains financial estimates and other forward-looking statements that are subject to risks and uncertainties. A discussion of factors that may affect future results is contained in AT&T's filings with the Securities and Exchange Commission. AT&T disclaims any obligation to update or revise statements contained in this filing based on new information or otherwise.

Item 9.01 Financial Statements and Exhibits.

The following exhibits are filed as part of this report:

(d) Exhibits

99.1 AT&T Inc. selected financial statements and operating data.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	AT&T INC.



Date: April 26, 2016	By: /s/ Debra L. Dial Debra L. Dial Senior Vice President and Controller

Financial Data

AT&T Inc.
Consolidated Statements of Income
Dollars in millions except per share amounts
Unaudited	Three Months Ended
		3/31/2016			3/31/2015			% Chg

Operating Revenues
Service		$	37,101		$	28,962			28.1	%
Equipment			3,434			3,614			-5.0	%
Total Operating Revenues			40,535			32,576			24.4	%

Operating Expenses
Cost of services and sales
Equipment			4,375			4,546			-3.8	%
Broadcast, programming and operations			4,629			1,122			-
Other cost of services (exclusive of depreciation and amortization shown separately below)			9,396			8,812			6.6	%
Selling, general and administrative			8,441			7,961			6.0	%
Depreciation and amortization			6,563			4,578			43.4	%
Total Operating Expenses			33,404			27,019			23.6	%
Operating Income			7,131			5,557			28.3	%
Interest Expense			1,207			899			34.3	%
Equity in Net Income of Affiliates			13			-			-
Other Income (Expense) - Net			70			70			-
Income Before Income Taxes			6,007			4,728			27.1	%
Income Tax Expense			2,122			1,389			52.8	%
Net Income			3,885			3,339			16.4	%
Less: Net Income Attributable to Noncontrolling Interest			(82	)		(76	)		-7.9	%
Net Income Attributable to AT&T		$	3,803		$	3,263			16.5	%


Basic Earnings Per Share Attributable to AT&T		$	0.62		$	0.63			-1.6	%
Weighted Average Common Shares Outstanding (000,000)			6,172			5,203			18.6	%

Diluted Earnings Per Share Attributable to AT&T		$	0.61		$	0.63			-3.2	%
Weighted Average Common Shares Outstanding with Dilution (000,000)			6,190			5,219			18.6	%

Financial Data

AT&T Inc.
Statements of Segment Income
Dollars in millions
Unaudited
	Three Months Ended
	3/31/2016			3/31/2015			% Chg
Business Solutions
Segment Operating Revenues
Wireless service	$	7,855		$	7,515			4.5	%
Fixed strategic services		2,786			2,549			9.3	%
Legacy voice and data services		4,338			4,754			-8.8	%
Other service and equipment		859			846			1.5	%
Wireless Equipment		1,771			1,893			-6.4	%
Total Segment Operating Revenues		17,609			17,557			0.3	%

Segment Operating Expenses
Operations and Support Expenses		10,802			11,073			-2.4	%
Depreciation and amortization		2,508			2,342			7.1	%
Total Segment Operating Expenses		13,310			13,415			-0.8	%
Segment Operating Income		4,299			4,142			3.8	%
Equity in Net Income of Affiliates		-			-			-
Segment Contribution	$	4,299		$	4,142			3.8	%

Segment Operating Income Margin		24.4	%		23.6	%

Entertainment Group
Segment Operating Revenues
Video entertainment	$	8,904		$	1,871			-
High-speed internet		1,803			1,553			16.1	%
Legacy voice and data services		1,313			1,612			-18.5	%
Other service and equipment		638			624			2.2	%
Total Segment Operating Revenues		12,658			5,660			-

Segment Operating Expenses
Operations and Support Expenses		9,578			4,859			97.1	%
Depreciation and amortization		1,488			1,065			39.7	%
Total Segment Operating Expenses		11,066			5,924			86.8	%
Segment Operating Income (Loss)		1,592			(264	)		-
Equity in Net Income (Loss) of Affiliates		3			(6	)		-
Segment Contribution	$	1,595		$	(270	)		-

Segment Operating Income Margin		12.6	%		-4.7	%

Consumer Mobility
Segment Operating Revenues
Service	$	6,943		$	7,297			-4.9	%
Equipment		1,385			1,481			-6.5	%
Total Segment Operating Revenues		8,328			8,778			-5.1	%

Segment Operating Expenses
Operations and Support Expenses		4,912			5,541			-11.4	%
Depreciation and amortization		922			1,002			-8.0	%
Total Segment Operating Expenses		5,834			6,543			-10.8	%
Segment Operating Income		2,494			2,235			11.6	%
Equity in Net Income of Affiliates		-			-			-
Segment Contribution	$	2,494		$	2,235			11.6	%

Segment Operating Income Margin		29.9	%		25.5	%

International
Segment Operating Revenues
Video entertainment	$	1,130		$	-			-
Wireless service		455			215			-
Wireless Equipment		82			21			-
Total Segment Operating Revenues		1,667			236			-

Segment Operating Expenses
Operations and Support Expenses		1,588			218			-
Depreciation and amortization		277			28			-
Total Segment Operating Expenses		1,865			246			-
Segment Operating Income (Loss)		(198	)		(10	)		-
Equity in Net Income of Affiliates		14			-			-
Segment Contribution	$	(184	)	$	(10	)		-

Segment Operating Income Margin		-11.9	%		-4.2	%

Financial Data

AT&T Inc.
Consolidated Balance Sheets
Dollars in millions
	3/31/2016			12/31/2015
	Unaudited

Assets
Current Assets
Cash and cash equivalents	$	10,008		$	5,121
Accounts receivable - net of allowances for doubtful accounts of $697 and $704		16,070			16,532
Prepaid expenses		1,378			1,072
Other current assets		10,545			13,267
Total current assets		38,001			35,992
Property, Plant and Equipment - Net		123,454			124,450
Goodwill		104,651			104,568
Licenses		94,130			93,093
Customer Lists and Relationships - Net		17,197			18,208
Other Intangible Assets - Net		9,108			9,409
Investments in Equity Affiliates		1,594			1,606
Other Assets		15,503			15,346
Total Assets	$	403,638		$	402,672

Liabilities and Stockholders' Equity
Current Liabilities
Debt maturing within one year	$	8,399		$	7,636
Accounts payable and accrued liabilities		26,169			30,372
Advanced billing and customer deposits		4,550			4,682
Accrued taxes		2,455			2,176
Dividends payable		2,955			2,950
Total current liabilities		44,528			47,816
Long-Term Debt		122,104			118,515
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes		57,489			56,181
Postemployment benefit obligation		34,114			34,262
Other noncurrent liabilities		20,998			22,258
Total deferred credits and other noncurrent liabilities		112,601			112,701
Stockholders' Equity
Common stock		6,495			6,495
Additional paid-in capital		89,414			89,763
Retained earnings		34,506			33,671
Treasury stock		(12,163	)		(12,592	)
Accumulated other comprehensive income		5,180			5,334
Noncontrolling interest		973			969
Total stockholders' equity		124,405			123,640
Total Liabilities and Stockholders' Equity	$	403,638		$	402,672

Financial Data

AT&T Inc.
Consolidated Statements of Cash Flows
Dollars in millions
(Unaudited)
	Three Months Ended
	3/31/2016			3/31/2015

Operating Activities
Net income	$	3,885		$	3,339
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization		6,563			4,578
Undistributed earnings from investments in equity affiliates		(13	)		-
Provision for uncollectible accounts		374			285
Deferred income tax expense		1,346			252
Net gain from sale of investments, net of impairments		(44	)		(33	)
Changes in operating assets and liabilities:
Accounts receivable		627			739
Other current assets		612			408
Accounts payable and accrued liabilities		(4,006	)		(1,817	)
Retirement benefit funding		(140	)		(140	)
Other - net		(1,304	)		(873	)
Total adjustments		4,015			3,399
Net Cash Provided by Operating Activities		7,900			6,738

Investing Activities
Construction and capital expenditures:
Capital expenditures		(4,451	)		(3,848	)
Interest during construction		(218	)		(123	)
Acquisitions, net of cash acquired		(165	)		(19,514	)
Dispositions		81			8
Sales of securities, net		445			1,890
Net Cash Used in Investing Activities		(4,308	)		(21,587	)

Financing Activities
Issuance of long-term debt		5,978			16,572
Repayment of long-term debt		(2,296	)		(596	)
Issuance of treasury stock		89			8
Dividends paid		(2,947	)		(2,434	)
Other		471			(2,860	)
Net Cash Provided by Financing Activities		1,295			10,690
Net increase (decrease) in cash and cash equivalents		4,887			(4,159	)
Cash and cash equivalents beginning of year		5,121			8,603
Cash and Cash Equivalents End of Period	$	10,008		$	4,444

Financial Data

AT&T Inc.
Supplementary Operating and Financial Data
Dollars in millions except per share amounts, subscribers and connections in (000s)
Unaudited	Three Months Ended
	3/31/2016			3/31/2015			% Chg
Business Solutions Wireless Subscribers		75,771			66,945			13.2	%
Postpaid		48,844			45,959			6.3	%
Reseller		64			14			-
Connected Devices		26,863			20,972			28.1	%

Business Solutions Wireless Net Adds		1,689			1,324			27.6	%
Postpaid		133			297			-55.2	%
Reseller		(22	)		3			-
Connected Devices		1,578			1,024			54.1	%

Business Wireless Postpaid Churn		1.02	%		0.90	%	12		BP

Consumer Mobility Subscribers		54,674			54,827			-0.3	%
Postpaid		28,294			30,216			-6.4	%
Prepaid		12,171			10,037			21.3	%
Reseller		13,313			13,581			-2.0	%
Connected Devices		896			993			-9.8	%

Consumer Mobility Net Adds		92			(106	)		-
Postpaid		(4	)		144			-
Prepaid		500			98			-
Reseller		(378	)		(269	)		-40.5	%
Connected Devices		(26	)		(79	)		67.1	%

Consumer Mobility Postpaid Churn		1.24	%		1.20	%	4		BP
Total Consumer Mobility Churn		2.11	%		2.04	%	7		BP

Entertainment Group		51,748			34,175			51.4	%
Video Connections		25,344			5,969			-
Satellite		20,112			-			-
U-verse		5,232			5,969			-12.3	%

Video Net Adds		(54	)		49			-
Satellite		328			-			-
U-verse		(382	)		49			-

Broadband Connections		14,291			14,537			-1.7	%
IP		12,542			11,796			6.3	%
DSL		1,749			2,741			-36.2	%

Broadband Net Adds		5			93			-94.6	%
IP		186			413			-55.0	%
DSL		(181	)		(320	)		43.4	%

Total Wireline Voice Connections		12,113			13,669			-11.4	%

AT&T International
Mexican Wireless Subscribers and Connections
Subscribers		9,213			5,728			60.8	%
Net Adds		529			-			-
Total Churn		5.45	%		-			-

Video Subscribers and Connections
Latin America Video Subscribers		12,436			-			-
Pan Americana		7,094			-			-
Brazil		5,342			-			-

Video Subscribers and Connections Net Adds
Latin America Video Subscribers		(73	)		-			-
Pan Americana		28			-			-
Brazil		(101	)		-			-

Financial Data

AT&T Inc.
Supplementary Operating and Financial Data
Dollars in millions except per share amounts, subscribers and connections in (000s)
Unaudited	Three Months Ended
	3/31/2016			3/31/2015			% Chg
AT&T Total Subscribers and Connections
AT&T Mobility Subscribers		130,445			121,772			7.1	%
Postpaid		77,138			76,175			1.3	%
Prepaid		12,171			10,037			21.3	%
Branded		89,309			86,212			3.6	%
Reseller		13,378			13,595			-1.6	%
Connected Devices		27,758			21,965			26.4	%

AT&T Mobility Net Adds		1,781			1,218			46.2	%
Postpaid		129			441			-70.7	%
Prepaid		500			98			-
Branded		629			539			16.7	%
Reseller		(400	)		(266	)		-50.4	%
Connected Devices		1,552			945			64.2	%
M&A Activity, Partitioned Customers and Other Adjs.		24			-			-

AT&T Mobility Churn
Postpaid Churn		1.10	%		1.02	%	8		BP
Total Churn		1.42	%		1.40	%	2		BP

Other
Domestic Licensed POPs (000,000)		322			321			0.3	%

Total Video Subscribers		37,808			5,993			-
Domestic		25,372			5,993			-
Pan Americana		7,094			-			-
Brazil		5,342			-			-

Total Video Net Adds		(125	)		50			-
Domestic		(52	)		50			-
Pan Americana		28			-			-
Brazil		(101	)		-			-

Total Broadband Connections		15,764			16,097			-2.1	%
IP		13,470			12,644			6.5	%
DSL		2,294			3,453			-33.6	%

Broadband Net Adds		(14	)		69			-
IP		202			439			-54.0	%
DSL		(216	)		(370	)		41.6	%

Total Wireline Voice Connections		21,459			24,149			-11.1	%

Total Wireless Subscribers		139,658			127,500			9.5	%
Domestic Wireless Subscribers		130,445			121,772			7.1	%
Mexican Wireless Subscribers		9,213			5,728			60.8	%

Branded Subscribers		98,158			91,448			7.3	%
Branded Net Adds		1,195			539			-

AT&T Inc.
Construction and capital expenditures:
Capital expenditures	$	4,451		$	3,848			15.7	%
Interest during construction	$	218		$	123			77.2	%
Dividends Declared per Share	$	0.48		$	0.47			2.1	%
End of Period Common Shares Outstanding (000,000)		6,156			5,193			18.5	%
Debt Ratio^1,2		51.2	%		51.5	%	-30		BP
Total Employees		280,870			250,790			12.0	%

¹	Prior year amounts restated to conform to current period reporting methodology.
²	Total long-term debt plus debt maturing within one year divided by total debt plus total stockholders' equity.
	Note: For the end of 1Q16, total switched access lines were 15,975.
		Business Solutions and Consumer Mobility may not total to AT&T Mobility due to rounding.

Financial Data

AT&T Inc.
Supplemental AT&T Mobility Results
Dollars in millions
Unaudited
	Three Months Ended
	3/31/2016			3/31/2015			% Chg
AT&T Mobility
Operating Revenues
Service	$	14,798		$	14,812			-0.1	%
Equipment		3,156			3,374			-6.5	%
Total Operating Revenues		17,954			18,186			-1.3	%

Operating Expenses
Operations and support expenses		10,624			11,472			-7.4	%
Depreciation and amortization		2,056			2,005			2.5	%
Total Operating Expenses		12,680			13,477			-5.9	%
Operating Income	$	5,274		$	4,709			12.0	%

Operating Income Margin		29.4	%		25.9	%

Financial Data

AT&T Inc.
Segment Supplemental
Dollars in millions except per share amounts


For the three months ended March 31, 2016
	Revenues		Operations and Support Expenses			EBITDA			Depreciation and Amortization		Operating Income (Loss)			Equity in Net Income of Affiliates			Segment Contribution
Business Solutions	$	17,609	$	10,802		$	6,807		$	2,508	$	4,299		$	-		$	4,299
Entertainment Group		12,658		9,578			3,080			1,488		1,592			3			1,595
Consumer Mobility		8,328		4,912			3,416			922		2,494			-			2,494
International		1,667		1,588			79			277		(198	)		14			(184	)
Segment Total	$	40,262	$	26,880		$	13,382		$	5,195	$	8,187		$	17		$	8,204
Corporate and Other		273		377			(104	)		17		(121	)
Acquisition-related items		-		295			(295	)		1,351		(1,646	)
Certain Significant items		-		(711	)		711			-		711
AT&T Inc.	$	40,535	$	26,841		$	13,694		$	6,563	$	7,131

For the three months ended March 31, 2015
	Revenues		Operations and Support Expenses			EBITDA			Depreciation and Amortization		Operating Income (Loss)			Equity in Net Income of Affiliates			Segment Contribution
Business Solutions	$	17,557	$	11,073		$	6,484		$	2,342	$	4,142		$	-		$	4,142
Entertainment Group		5,660		4,859			801			1,065		(264	)		(6	)		(270	)
Consumer Mobility		8,778		5,541			3,237			1,002		2,235			-			2,235
International		236		218			18			28		(10	)		-			(10	)
Segment Total	$	32,231	$	21,691		$	10,540		$	4,437	$	6,103		$	(6	)	$	6,097
Corporate and Other		345		234			111			20		91
Acquisition-related items		-		299			(299	)		121		(420	)
Certain Significant items		-		217			(217	)		-		(217	)
AT&T Inc.	$	32,576	$	22,441		$	10,135		$	4,578	$	5,557

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Form 8-K AT&T INC. For: Mar 31

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