(Mark one)
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☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended March 31, 2018
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
|
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|
|
For the transition period from to
|
Delaware
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|
23-2259884
|
(State or other jurisdiction
of incorporation or organization)
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|
(I.R.S. Employer Identification No.)
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1095 Avenue of the Americas
New York, New York
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|
10036
|
(Address of principal executive offices)
|
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(Zip Code)
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Large accelerated filer
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☒
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Accelerated filer
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☐
|
Non-accelerated filer
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☐ (Do not check if a smaller reporting company)
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Smaller reporting company
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☐
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Emerging growth company
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☐
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Table of Contents
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Page
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Item 1.
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Three months ended March 31, 2018 and 2017
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Three months ended March 31, 2018 and 2017
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At March 31, 2018 and December 31, 2017
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Three months ended March 31, 2018 and 2017
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 1A.
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Item 2.
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Item 6.
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Part I - Financial Information
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Three Months Ended
|
|
|||||
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March 31,
|
|
|||||
(dollars in millions, except per share amounts) (unaudited)
|
2018
|
|
|
2017
|
|
||
|
|
|
|
||||
Operating Revenues
|
|
|
|
||||
Service revenues and other
|
$
|
26,732
|
|
|
$
|
26,050
|
|
Wireless equipment revenues
|
5,040
|
|
|
3,764
|
|
||
Total Operating Revenues
|
31,772
|
|
|
29,814
|
|
||
|
|
|
|
||||
Operating Expenses
|
|
|
|
||||
Cost of services (exclusive of items shown below)
|
7,946
|
|
|
7,239
|
|
||
Wireless cost of equipment
|
5,309
|
|
|
4,808
|
|
||
Selling, general and administrative expense
|
6,844
|
|
|
6,746
|
|
||
Depreciation and amortization expense
|
4,324
|
|
|
4,059
|
|
||
Total Operating Expenses
|
24,423
|
|
|
22,852
|
|
||
|
|
|
|
||||
Operating Income
|
7,349
|
|
|
6,962
|
|
||
Equity in losses of unconsolidated businesses
|
(19
|
)
|
|
(21
|
)
|
||
Other expense, net
|
(75
|
)
|
|
(627
|
)
|
||
Interest expense
|
(1,201
|
)
|
|
(1,132
|
)
|
||
Income Before Provision For Income Taxes
|
6,054
|
|
|
5,182
|
|
||
Provision for income taxes
|
(1,388
|
)
|
|
(1,629
|
)
|
||
Net Income
|
$
|
4,666
|
|
|
$
|
3,553
|
|
|
|
|
|
||||
Net income attributable to noncontrolling interests
|
$
|
121
|
|
|
$
|
103
|
|
Net income attributable to Verizon
|
4,545
|
|
|
3,450
|
|
||
Net Income
|
$
|
4,666
|
|
|
$
|
3,553
|
|
|
|
|
|
||||
Basic Earnings Per Common Share
|
|
|
|
||||
Net income attributable to Verizon
|
$
|
1.11
|
|
|
$
|
0.85
|
|
Weighted-average shares outstanding (in millions)
|
4,104
|
|
|
4,082
|
|
||
|
|
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|
||||
Diluted Earnings Per Common Share
|
|
|
|
||||
Net income attributable to Verizon
|
$
|
1.11
|
|
|
$
|
0.84
|
|
Weighted-average shares outstanding (in millions)
|
4,107
|
|
|
4,087
|
|
||
|
|
|
|
||||
Dividends declared per common share
|
$
|
0.5900
|
|
|
$
|
0.5775
|
|
|
Three Months Ended
|
|
|||||
|
March 31,
|
|
|||||
(dollars in millions) (unaudited)
|
2018
|
|
|
2017
|
|
||
|
|
|
|
||||
Net Income
|
$
|
4,666
|
|
|
$
|
3,553
|
|
Other Comprehensive Income (loss), net of tax expense (benefit)
|
|
|
|
||||
Foreign currency translation adjustments
|
93
|
|
|
77
|
|
||
Unrealized gain (loss) on cash flow hedges, net of tax of $(180) and $12
|
501
|
|
|
(18
|
)
|
||
Unrealized gain (loss) on marketable securities, net of tax of $1 and $(3)
|
(5
|
)
|
|
14
|
|
||
Defined benefit pension and postretirement plans, net of tax of $60 and $86
|
(173
|
)
|
|
(137
|
)
|
||
Other comprehensive income (loss) attributable to Verizon
|
416
|
|
|
(64
|
)
|
||
Total Comprehensive Income
|
$
|
5,082
|
|
|
$
|
3,489
|
|
|
|
|
|
||||
Comprehensive income attributable to noncontrolling interests
|
$
|
121
|
|
|
$
|
103
|
|
Comprehensive income attributable to Verizon
|
4,961
|
|
|
3,386
|
|
||
Total Comprehensive Income
|
$
|
5,082
|
|
|
$
|
3,489
|
|
|
At March 31,
|
|
|
At December 31,
|
|
||
(dollars in millions, except per share amounts) (unaudited)
|
2018
|
|
|
2017
|
|
||
|
|
|
|
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,923
|
|
|
$
|
2,079
|
|
Accounts receivable, net of allowances of $922 and $939
|
22,595
|
|
|
23,493
|
|
||
Inventories
|
1,285
|
|
|
1,034
|
|
||
Prepaid expenses and other
|
5,222
|
|
|
3,307
|
|
||
Total current assets
|
31,025
|
|
|
29,913
|
|
||
|
|
|
|
||||
Property, plant and equipment
|
246,877
|
|
|
246,498
|
|
||
Less accumulated depreciation
|
158,955
|
|
|
157,930
|
|
||
Property, plant and equipment, net
|
87,922
|
|
|
88,568
|
|
||
|
|
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|
||||
Investments in unconsolidated businesses
|
994
|
|
|
1,039
|
|
||
Wireless licenses
|
93,677
|
|
|
88,417
|
|
||
Goodwill
|
29,121
|
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|
29,172
|
|
||
Other intangible assets, net
|
10,014
|
|
|
10,247
|
|
||
Other assets
|
11,763
|
|
|
9,787
|
|
||
Total assets
|
$
|
264,516
|
|
|
$
|
257,143
|
|
|
|
|
|
||||
Liabilities and Equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Debt maturing within one year
|
$
|
6,323
|
|
|
$
|
3,453
|
|
Accounts payable and accrued liabilities
|
17,052
|
|
|
21,232
|
|
||
Other current liabilities
|
8,240
|
|
|
8,352
|
|
||
Total current liabilities
|
31,615
|
|
|
33,037
|
|
||
|
|
|
|
||||
Long-term debt
|
112,734
|
|
|
113,642
|
|
||
Employee benefit obligations
|
20,689
|
|
|
22,112
|
|
||
Deferred income taxes
|
34,414
|
|
|
31,232
|
|
||
Other liabilities
|
12,719
|
|
|
12,433
|
|
||
Total long-term liabilities
|
180,556
|
|
|
179,419
|
|
||
|
|
|
|
||||
Commitments and Contingencies (Note 12)
|
|
|
|
||||
|
|
|
|
||||
Equity
|
|
|
|
||||
Series preferred stock ($0.10 par value; 250,000,000 shares authorized; none issued)
|
—
|
|
|
—
|
|
||
Common stock ($0.10 par value; 6,250,000,000 shares authorized in each period; 4,291,422,260 and 4,242,374,240 shares issued)
|
429
|
|
|
424
|
|
||
Additional paid in capital
|
13,437
|
|
|
11,101
|
|
||
Retained earnings
|
39,974
|
|
|
35,635
|
|
||
Accumulated other comprehensive income
|
3,705
|
|
|
2,659
|
|
||
Common stock in treasury, at cost (159,525,752 and 162,897,868 shares outstanding)
|
(6,992
|
)
|
|
(7,139
|
)
|
||
Deferred compensation – employee stock ownership plans and other
|
228
|
|
|
416
|
|
||
Noncontrolling interests
|
1,564
|
|
|
1,591
|
|
||
Total equity
|
52,345
|
|
|
44,687
|
|
||
Total liabilities and equity
|
$
|
264,516
|
|
|
$
|
257,143
|
|
|
Three Months Ended
|
|
|||||
|
March 31,
|
|
|||||
(dollars in millions) (unaudited)
|
2018
|
|
|
2017
|
|
||
|
|
|
|
||||
Cash Flows from Operating Activities
|
|
|
|
||||
Net Income
|
$
|
4,666
|
|
|
$
|
3,553
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization expense
|
4,324
|
|
|
4,059
|
|
||
Employee retirement benefits
|
(151
|
)
|
|
(111
|
)
|
||
Deferred income taxes
|
702
|
|
|
2,025
|
|
||
Provision for uncollectible accounts
|
239
|
|
|
330
|
|
||
Equity in losses of unconsolidated businesses, net of dividends received
|
30
|
|
|
28
|
|
||
Changes in current assets and liabilities, net of effects from acquisition/disposition of businesses
|
(2,033
|
)
|
|
(4,998
|
)
|
||
Discretionary contributions to qualified pension plans
|
(1,000
|
)
|
|
(3,411
|
)
|
||
Other, net
|
(129
|
)
|
|
(99
|
)
|
||
Net cash provided by operating activities
|
6,648
|
|
|
1,376
|
|
||
|
|
|
|
||||
Cash Flows from Investing Activities
|
|
|
|
||||
Capital expenditures (including capitalized software)
|
(4,552
|
)
|
|
(3,067
|
)
|
||
Acquisitions of businesses, net of cash acquired
|
(32
|
)
|
|
(1,746
|
)
|
||
Acquisitions of wireless licenses
|
(970
|
)
|
|
(196
|
)
|
||
Other, net
|
269
|
|
|
459
|
|
||
Net cash used in investing activities
|
(5,285
|
)
|
|
(4,550
|
)
|
||
|
|
|
|
||||
Cash Flows from Financing Activities
|
|
|
|
||||
Proceeds from long-term borrowings
|
1,956
|
|
|
13,054
|
|
||
Proceeds from asset-backed long-term borrowings
|
1,178
|
|
|
1,283
|
|
||
Repayments of long-term borrowings and capital lease obligations
|
(2,984
|
)
|
|
(5,592
|
)
|
||
Increase (decrease) in short-term obligations, excluding current maturities
|
1,222
|
|
|
(52
|
)
|
||
Dividends paid
|
(2,407
|
)
|
|
(2,354
|
)
|
||
Other, net
|
(281
|
)
|
|
(1,674
|
)
|
||
Net cash provided by (used in) financing activities
|
(1,316
|
)
|
|
4,665
|
|
||
|
|
|
|
||||
Increase in cash, cash equivalents and restricted cash
|
47
|
|
|
1,491
|
|
||
Cash, cash equivalents and restricted cash, beginning of period
|
2,888
|
|
|
3,177
|
|
||
Cash, cash equivalents and restricted cash, end of period (Note 1)
|
$
|
2,935
|
|
|
$
|
4,668
|
|
1.
|
Basis of Presentation
|
|
At March 31,
|
|
|
At December 31,
|
|
|
Increase/
|
|
|||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|
|||
Cash and cash equivalents
|
$
|
1,923
|
|
|
$
|
2,079
|
|
|
$
|
(156
|
)
|
Restricted cash:
|
|
|
|
|
|
||||||
Prepaid expenses and other
|
885
|
|
|
693
|
|
|
192
|
|
|||
Other assets
|
127
|
|
|
116
|
|
|
11
|
|
|||
Cash, cash equivalents and restricted cash
|
$
|
2,935
|
|
|
$
|
2,888
|
|
|
$
|
47
|
|
|
|
|
Adjustments due to
|
|
|
||||||||||||||
(dollars in millions)
|
At December 31,
2017
|
|
|
Topic 606
|
|
|
ASU 2018-02
|
|
|
Other ASUs
|
|
|
At January 1,
2018
|
|
|||||
Accounts receivable, net of allowance
|
$
|
23,493
|
|
|
$
|
53
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
23,546
|
|
Prepaid expenses and other
|
3,307
|
|
|
2,014
|
|
|
—
|
|
|
—
|
|
|
5,321
|
|
|||||
Other assets
|
9,787
|
|
|
1,238
|
|
|
—
|
|
|
(59
|
)
|
|
10,966
|
|
|||||
Investments in unconsolidated businesses
|
1,039
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
1,041
|
|
|||||
Other current liabilities
|
8,352
|
|
|
(541
|
)
|
|
—
|
|
|
—
|
|
|
7,811
|
|
|||||
Deferred income taxes
|
31,232
|
|
|
1,008
|
|
|
—
|
|
|
(31
|
)
|
|
32,209
|
|
|||||
Other liabilities
|
12,433
|
|
|
(94
|
)
|
|
—
|
|
|
—
|
|
|
12,339
|
|
|||||
Retained earnings
|
35,635
|
|
|
2,890
|
|
|
(652
|
)
|
|
(6
|
)
|
|
37,867
|
|
|||||
Accumulated other comprehensive income
|
2,659
|
|
|
—
|
|
|
652
|
|
|
(22
|
)
|
|
3,289
|
|
|||||
Noncontrolling interests
|
1,591
|
|
|
44
|
|
|
—
|
|
|
—
|
|
|
1,635
|
|
|
Three Months Ended March 31, 2018
|
|
|||||||||
(dollars in millions)
|
As reported
|
|
|
Balances without adoption of
Topic 606
|
|
|
Adjustments
|
|
|||
Operating Revenues
|
|
|
|
|
|
||||||
Service revenues and other
|
$
|
26,732
|
|
|
$
|
27,133
|
|
|
$
|
(401
|
)
|
Wireless equipment revenues
|
5,040
|
|
|
4,594
|
|
|
446
|
|
|||
Total Operating Revenues
|
$
|
31,772
|
|
|
$
|
31,727
|
|
|
$
|
45
|
|
|
|
|
|
|
|
||||||
Cost of services (exclusive of items shown below)
|
$
|
7,946
|
|
|
$
|
7,956
|
|
|
$
|
(10
|
)
|
Wireless cost of equipment
|
5,309
|
|
|
5,287
|
|
|
22
|
|
|||
Selling, general and administrative expense
|
6,844
|
|
|
7,234
|
|
|
(390
|
)
|
|||
|
|
|
|
|
|
||||||
Income Before Provision For Income Taxes
|
6,054
|
|
|
5,631
|
|
|
423
|
|
|||
Provision for income taxes
|
(1,388
|
)
|
|
(1,280
|
)
|
|
(108
|
)
|
|||
Net Income
|
$
|
4,666
|
|
|
$
|
4,351
|
|
|
$
|
315
|
|
|
|
|
|
|
|
||||||
Net income attributable to noncontrolling interests
|
$
|
121
|
|
|
$
|
114
|
|
|
$
|
7
|
|
Net income attributable to Verizon
|
4,545
|
|
|
4,237
|
|
|
308
|
|
|||
Net Income
|
$
|
4,666
|
|
|
$
|
4,351
|
|
|
$
|
315
|
|
|
At March 31, 2018
|
|
|||||||||
(dollars in millions)
|
As reported
|
|
|
Balances without adoption of
Topic 606
|
|
|
Adjustments
|
|
|||
Assets
|
|
|
|
|
|
||||||
Current assets
|
|
|
|
|
|
||||||
Accounts receivable, net of allowance
|
$
|
22,595
|
|
|
$
|
22,457
|
|
|
$
|
138
|
|
Prepaid expenses and other
|
5,222
|
|
|
3,190
|
|
|
2,032
|
|
|||
|
|
|
|
|
|
||||||
Investments in unconsolidated businesses
|
994
|
|
|
992
|
|
|
2
|
|
|||
Other assets
|
11,763
|
|
|
10,213
|
|
|
1,550
|
|
|||
|
|
|
|
|
|
||||||
Liabilities and Equity
|
|
|
|
|
|
||||||
Current liabilities
|
|
|
|
|
|
||||||
Accounts payable and accrued liabilities
|
17,052
|
|
|
16,981
|
|
|
71
|
|
|||
Other current liabilities
|
8,240
|
|
|
8,791
|
|
|
(551
|
)
|
|||
|
|
|
|
|
|
||||||
Deferred income taxes
|
34,414
|
|
|
33,370
|
|
|
1,044
|
|
|||
Other liabilities
|
12,719
|
|
|
12,810
|
|
|
(91
|
)
|
|||
|
|
|
|
|
|
||||||
Equity
|
|
|
|
|
|
||||||
Retained earnings
|
39,974
|
|
|
36,776
|
|
|
3,198
|
|
|||
Noncontrolling interests
|
1,564
|
|
|
1,513
|
|
|
51
|
|
2.
|
Revenues and Contract Costs
|
|
At January 1,
|
|
|
At March 31,
|
|
||
(dollars in millions)
|
2018
|
|
|
2018
|
|
||
Receivables
(1)
|
$
|
12,073
|
|
|
$
|
11,028
|
|
Device payment plan agreement receivables
(2)
|
1,461
|
|
|
3,630
|
|
(1)
|
Balances do not include receivables related to the following contracts: leasing arrangements (such as towers and equipment), captive reinsurance arrangements primarily related to wireless device insurance and the interest on equipment financed on a device payment plan agreement when sold to the customer by an authorized agent.
|
(2)
|
Included in device payment plan agreement receivables presented in
Note 6
. Balances do not include receivables related to contracts completed prior to January 1, 2018 and receivables derived from the sale of equipment on a device payment plan through an authorized agent.
|
(dollars in millions)
|
Contract Assets
|
|
|
Balance at January 1, 2018
|
$
|
38
|
|
Opening balance sheet adjustment related to Topic 606 adoption
|
1,132
|
|
|
Adjusted opening balance, January 1, 2018
|
1,170
|
|
|
Increase resulting from new contracts
|
426
|
|
|
Contract assets reclassified to a receivable or collected in cash
|
(435
|
)
|
|
Other
|
(55
|
)
|
|
Balance at March 31, 2018
|
$
|
1,106
|
|
(dollars in millions)
|
Contract Liabilities
|
|
|
Balance at January 1, 2018
(1)
|
$
|
5,086
|
|
Opening balance sheet adjustments related to Topic 606 adoption
|
(634
|
)
|
|
Adjusted opening balance, January 1, 2018
|
4,452
|
|
|
Net increase in contract liabilities
|
3,607
|
|
|
Revenue recognized related to contract liabilities existing at January 1, 2018
|
(3,453
|
)
|
|
Other
|
(35
|
)
|
|
Balance at March 31, 2018
|
$
|
4,571
|
|
|
At March 31,
|
|
|
(dollars in millions)
|
2018
|
|
|
Assets
|
|
||
Prepaid expenses and other
|
$
|
812
|
|
Other assets
|
294
|
|
|
Total
|
$
|
1,106
|
|
|
|
||
Liabilities
|
|
||
Other current liabilities
|
$
|
3,968
|
|
Other liabilities
|
603
|
|
|
Total
|
$
|
4,571
|
|
|
|
At March 31,
|
|
|
(dollars in millions)
|
Amortization Period
|
2018
|
|
|
Wireless
|
2 to 3 years
|
$
|
2,090
|
|
Wireline
|
2 to 5 years
|
779
|
|
|
Corporate
|
2 to 3 years
|
42
|
|
|
Total
|
|
$
|
2,911
|
|
|
At March 31,
|
|
|
(dollars in millions)
|
2018
|
|
|
Assets
|
|
||
Prepaid expenses and other
|
$
|
1,528
|
|
Other assets
|
1,383
|
|
|
Total
|
$
|
2,911
|
|
3.
|
Acquisitions and Divestitures
|
(dollars in millions)
|
As of March 31, 2018
|
|
|
Cash payment to Yahoo’s equity holders
|
$
|
4,673
|
|
Estimated liabilities to be paid
|
38
|
|
|
Total consideration
|
$
|
4,711
|
|
|
|
||
Assets acquired:
|
|
||
Goodwill
|
$
|
1,945
|
|
Intangible assets subject to amortization
|
1,873
|
|
|
Property, plant, and equipment
|
1,805
|
|
|
Other
|
1,326
|
|
|
Total assets acquired
|
6,949
|
|
|
|
|
||
Liabilities assumed:
|
|
||
Total liabilities assumed
|
2,188
|
|
|
|
|
||
Net assets acquired:
|
4,761
|
|
|
Noncontrolling interest
|
(50
|
)
|
|
Total consideration
|
$
|
4,711
|
|
4.
|
Wireless Licenses, Goodwill and Other Intangible Assets
|
|
At March 31,
|
|
At December 31,
|
|
||
(dollars in millions)
|
2018
|
|
2017
|
|
||
Wireless licenses
|
$
|
93,677
|
|
$
|
88,417
|
|
(dollars in millions)
|
Wireless
|
|
|
Wireline
|
|
|
Other
|
|
|
Total
|
|
||||
Balance at January 1, 2018
|
$
|
18,397
|
|
|
$
|
3,993
|
|
|
$
|
6,782
|
|
|
$
|
29,172
|
|
Acquisitions (Note 3)
|
—
|
|
|
(82
|
)
|
|
26
|
|
|
(56
|
)
|
||||
Reclassifications, adjustments and other
|
—
|
|
|
3
|
|
|
2
|
|
|
5
|
|
||||
Balance at March 31, 2018
|
$
|
18,397
|
|
|
$
|
3,914
|
|
|
$
|
6,810
|
|
|
$
|
29,121
|
|
|
At March 31, 2018
|
|
|
At December 31, 2017
|
|
||||||||||||||||||
(dollars in millions)
|
Gross
Amount
|
|
|
Accumulated
Amortization
|
|
|
Net
Amount
|
|
|
Gross
Amount
|
|
|
Accumulated
Amortization
|
|
|
Net
Amount
|
|
||||||
Customer lists (5 to 13 years)
|
$
|
3,634
|
|
|
$
|
(777
|
)
|
|
$
|
2,857
|
|
|
$
|
3,621
|
|
|
$
|
(691
|
)
|
|
$
|
2,930
|
|
Non-network internal-use software (3 to 7 years)
|
18,287
|
|
|
(12,765
|
)
|
|
5,522
|
|
|
18,010
|
|
|
(12,374
|
)
|
|
5,636
|
|
||||||
Other (2 to 25 years)
|
2,485
|
|
|
(850
|
)
|
|
1,635
|
|
|
2,474
|
|
|
(793
|
)
|
|
1,681
|
|
||||||
Total
|
$
|
24,406
|
|
|
$
|
(14,392
|
)
|
|
$
|
10,014
|
|
|
$
|
24,105
|
|
|
$
|
(13,858
|
)
|
|
$
|
10,247
|
|
|
Three Months Ended
|
|
|
(dollars in millions)
|
March 31,
|
|
|
2018
|
$
|
534
|
|
2017
|
452
|
|
Years
|
(dollars in millions)
|
|
|
Remainder of 2018
|
$
|
1,591
|
|
2019
|
1,841
|
|
|
2020
|
1,527
|
|
|
2021
|
1,277
|
|
|
2022
|
1,068
|
|
|
2023
|
828
|
|
5.
|
Debt
|
(dollars in millions)
|
Debt
Maturing
within One
Year
|
|
|
Long-term
Debt
|
|
|
Total
|
|
|||
Balance at January 1, 2018
|
$
|
3,453
|
|
|
$
|
113,642
|
|
|
$
|
117,095
|
|
Proceeds from long-term borrowings
|
247
|
|
|
1,709
|
|
|
1,956
|
|
|||
Proceeds from asset-backed long-term borrowings
|
—
|
|
|
1,178
|
|
|
1,178
|
|
|||
Repayments of long-term borrowings and capital leases obligations
|
(61
|
)
|
|
(2,923
|
)
|
|
(2,984
|
)
|
|||
Increase in short-term obligations, excluding current maturities
|
1,222
|
|
|
—
|
|
|
1,222
|
|
|||
Reclassifications of long-term debt
|
1,183
|
|
|
(1,183
|
)
|
|
—
|
|
|||
Other
|
279
|
|
|
311
|
|
|
590
|
|
|||
Balance at March 31, 2018
|
$
|
6,323
|
|
|
$
|
112,734
|
|
|
$
|
119,057
|
|
|
At March 31,
|
|
|
At December 31,
|
|
||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Assets
|
|
|
|
||||
Account receivable, net
|
$
|
8,478
|
|
|
$
|
8,101
|
|
Prepaid expenses and other
|
835
|
|
|
636
|
|
||
Other assets
|
3,278
|
|
|
2,680
|
|
||
|
|
|
|
||||
Liabilities
|
|
|
|
||||
Accounts payable and accrued liabilities
|
7
|
|
|
5
|
|
||
Short-term portion of long-term debt
|
3,099
|
|
|
1,932
|
|
||
Long-term debt
|
6,969
|
|
|
6,955
|
|
6.
|
Wireless Device Payment Plans
|
|
At March 31,
|
|
|
At December 31,
|
|
||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Device payment plan agreement receivables, gross
|
$
|
17,588
|
|
|
$
|
17,770
|
|
Unamortized imputed interest
|
(661
|
)
|
|
(821
|
)
|
||
Device payment plan agreement receivables, net of unamortized imputed interest
|
16,927
|
|
|
16,949
|
|
||
Allowance for credit losses
|
(803
|
)
|
|
(848
|
)
|
||
Device payment plan agreement receivables, net
|
$
|
16,124
|
|
|
$
|
16,101
|
|
|
|
|
|
||||
Classified in our condensed consolidated balance sheets:
|
|
|
|
||||
Accounts receivable, net
|
$
|
11,219
|
|
|
$
|
11,064
|
|
Other assets
|
4,905
|
|
|
5,037
|
|
||
Device payment plan agreement receivables, net
|
$
|
16,124
|
|
|
$
|
16,101
|
|
|
At March 31,
|
|
|
At December 31,
|
|
||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Unbilled
|
$
|
16,444
|
|
|
$
|
16,591
|
|
Billed:
|
|
|
|
||||
Current
|
941
|
|
|
975
|
|
||
Past due
|
203
|
|
|
204
|
|
||
Device payment plan agreement receivables, gross
|
$
|
17,588
|
|
|
$
|
17,770
|
|
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Balance at January 1,
|
$
|
848
|
|
|
$
|
688
|
|
Bad debt expense
|
104
|
|
|
151
|
|
||
Write-offs
|
(149
|
)
|
|
(154
|
)
|
||
Balance at March 31,
|
$
|
803
|
|
|
$
|
685
|
|
7.
|
Fair Value Measurements
|
(dollars in millions)
|
Level 1
(1)
|
|
|
Level 2
(2)
|
|
|
Level 3
(3)
|
|
|
Total
|
|
||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Other assets:
|
|
|
|
|
|
|
|
||||||||
Equity securities
|
$
|
71
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
71
|
|
Fixed income securities
|
5
|
|
|
366
|
|
|
—
|
|
|
371
|
|
||||
Interest rate swaps
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
||||
Cross currency swaps
|
—
|
|
|
1,502
|
|
|
—
|
|
|
1,502
|
|
||||
Interest rate caps
|
—
|
|
|
13
|
|
|
—
|
|
|
13
|
|
||||
Total
|
$
|
76
|
|
|
$
|
1,886
|
|
|
$
|
—
|
|
|
$
|
1,962
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Other liabilities:
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
$
|
—
|
|
|
$
|
866
|
|
|
$
|
—
|
|
|
$
|
866
|
|
Cross currency swaps
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||
Interest rate caps
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
||||
Total
|
$
|
—
|
|
|
$
|
875
|
|
|
$
|
—
|
|
|
$
|
875
|
|
(dollars in millions)
|
Level 1
(1)
|
|
|
Level 2
(2)
|
|
|
Level 3
(3)
|
|
|
Total
|
|
||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Other assets:
|
|
|
|
|
|
|
|
||||||||
Equity securities
|
$
|
74
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
74
|
|
Fixed income securities
|
—
|
|
|
366
|
|
|
—
|
|
|
366
|
|
||||
Interest rate swaps
|
—
|
|
|
54
|
|
|
—
|
|
|
54
|
|
||||
Cross currency swaps
|
—
|
|
|
450
|
|
|
—
|
|
|
450
|
|
||||
Interest rate caps
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||
Total
|
$
|
74
|
|
|
$
|
876
|
|
|
$
|
—
|
|
|
$
|
950
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Other liabilities:
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
$
|
—
|
|
|
$
|
413
|
|
|
$
|
—
|
|
|
$
|
413
|
|
Cross currency swaps
|
—
|
|
|
46
|
|
|
—
|
|
|
46
|
|
||||
Total
|
$
|
—
|
|
|
$
|
459
|
|
|
$
|
—
|
|
|
$
|
459
|
|
(1)
|
quoted prices in active markets for identical assets or liabilities
|
(2)
|
observable inputs other than quoted prices in active markets for identical assets and liabilities
|
(3)
|
no observable pricing inputs in the market
|
|
At March 31,
|
|
|
At December 31,
|
|
||||||||||
|
2018
|
|
|
2017
|
|
||||||||||
(dollars in millions)
|
Carrying
Amount
|
|
|
Fair Value
|
|
|
Carrying
Amount
|
|
|
Fair
Value
|
|
||||
Short- and long-term debt, excluding capital leases
|
$
|
118,056
|
|
|
$
|
127,677
|
|
|
$
|
116,075
|
|
|
$
|
128,658
|
|
|
At March 31,
|
|
|
At December 31,
|
|
||
|
2018
|
|
|
2017
|
|
||
(dollars in millions)
|
Notional Amount
|
|
|
Notional Amount
|
|
||
Interest rate swaps
|
$
|
20,214
|
|
|
$
|
20,173
|
|
Cross currency swaps
|
16,638
|
|
|
16,638
|
|
||
Interest rate caps
|
2,840
|
|
|
2,840
|
|
|
At March 31,
|
|
|
At December 31,
|
|
||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Carrying amount of hedged liabilities
|
$
|
19,276
|
|
|
$
|
19,723
|
|
Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged liabilities
|
(807
|
)
|
|
(316
|
)
|
8.
|
Stock-Based Compensation
|
|
Restricted Stock Units
|
|
Performance
Stock Units
|
|
||||
(shares in thousands)
|
Equity Awards
|
|
|
Liability Awards
|
|
|
||
January 1, 2018
|
12,633
|
|
|
13,991
|
|
|
18,235
|
|
Granted
|
2,765
|
|
|
13,560
|
|
|
5,066
|
|
Payments
|
(5,778
|
)
|
|
(2,746
|
)
|
|
(4,525
|
)
|
Cancelled/Forfeited
|
(32
|
)
|
|
(542
|
)
|
|
(2,275
|
)
|
March 31, 2018
|
9,588
|
|
|
24,263
|
|
|
16,501
|
|
9.
|
Employee Benefits
|
|
(dollars in millions)
|
|
|||||||||||||
|
Pension
|
|
Health Care and Life
|
|
|||||||||||
Three Months Ended March 31,
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Service cost - Cost of services
|
$
|
58
|
|
|
$
|
55
|
|
|
$
|
26
|
|
|
$
|
29
|
|
Service cost - Selling, general and administrative expense
|
14
|
|
|
15
|
|
|
6
|
|
|
8
|
|
||||
Service cost
|
$
|
72
|
|
|
$
|
70
|
|
|
$
|
32
|
|
|
$
|
37
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of prior service cost (credit)
|
$
|
10
|
|
|
$
|
10
|
|
|
$
|
(244
|
)
|
|
$
|
(235
|
)
|
Expected return on plan assets
|
(329
|
)
|
|
(316
|
)
|
|
(11
|
)
|
|
(13
|
)
|
||||
Interest cost
|
166
|
|
|
171
|
|
|
153
|
|
|
165
|
|
||||
Other components
|
$
|
(153
|
)
|
|
$
|
(135
|
)
|
|
$
|
(102
|
)
|
|
$
|
(83
|
)
|
|
|
|
|
|
|
|
|
||||||||
Total
|
$
|
(81
|
)
|
|
$
|
(65
|
)
|
|
$
|
(70
|
)
|
|
$
|
(46
|
)
|
10.
|
Equity and Accumulated Other Comprehensive Income
|
|
Attributable
|
|
|
Noncontrolling
|
|
|
Total
|
|
|||
(dollars in millions)
|
to Verizon
|
|
|
Interests
|
|
|
Equity
|
|
|||
Balance at January 1, 2018
|
$
|
43,096
|
|
|
$
|
1,591
|
|
|
$
|
44,687
|
|
Opening balance sheet adjustment related to adoption of Topic 606, ASU 2018-02 and other ASUs (Note 1)
|
2,862
|
|
|
44
|
|
|
2,906
|
|
|||
Adjusted opening balance, January 1, 2018
|
45,958
|
|
|
1,635
|
|
|
47,593
|
|
|||
|
|
|
|
|
|
||||||
Net income
|
4,545
|
|
|
121
|
|
|
4,666
|
|
|||
Other comprehensive income
|
416
|
|
|
—
|
|
|
416
|
|
|||
Comprehensive income
|
4,961
|
|
|
121
|
|
|
5,082
|
|
|||
|
|
|
|
|
|
||||||
Common stock
|
5
|
|
|
—
|
|
|
5
|
|
|||
Contributed capital
|
2,336
|
|
|
—
|
|
|
2,336
|
|
|||
Dividends declared
|
(2,438
|
)
|
|
—
|
|
|
(2,438
|
)
|
|||
Common stock in treasury
|
147
|
|
|
—
|
|
|
147
|
|
|||
Distributions and other
|
(188
|
)
|
|
(192
|
)
|
|
(380
|
)
|
|||
Balance at March 31, 2018
|
$
|
50,781
|
|
|
$
|
1,564
|
|
|
$
|
52,345
|
|
(dollars in millions)
|
Foreign
currency
translation
adjustments
|
|
|
Unrealized
gain (loss) on cash
flow hedges
|
|
|
Unrealized
gain (loss) on
marketable
securities
|
|
|
Defined
benefit
pension and
postretirement
plans
|
|
|
Total
|
|
|||||
Balance at January 1, 2018
|
$
|
(468
|
)
|
|
$
|
(111
|
)
|
|
$
|
32
|
|
|
$
|
3,206
|
|
|
$
|
2,659
|
|
Opening balance sheet adjustment related to the adoption of ASU 2018-02 and other ASUs (Note 1)
|
(15
|
)
|
|
(24
|
)
|
|
(13
|
)
|
|
682
|
|
|
630
|
|
|||||
Adjusted opening balance, January 1, 2018
|
(483
|
)
|
|
(135
|
)
|
|
19
|
|
|
3,888
|
|
|
3,289
|
|
|||||
Other comprehensive income (loss)
|
93
|
|
|
803
|
|
|
(5
|
)
|
|
—
|
|
|
891
|
|
|||||
Amounts reclassified to net income
|
—
|
|
|
(302
|
)
|
|
—
|
|
|
(173
|
)
|
|
(475
|
)
|
|||||
Net other comprehensive income (loss)
|
93
|
|
|
501
|
|
|
(5
|
)
|
|
(173
|
)
|
|
416
|
|
|||||
Balance at March 31, 2018
|
$
|
(390
|
)
|
|
$
|
366
|
|
|
$
|
14
|
|
|
$
|
3,715
|
|
|
$
|
3,705
|
|
11.
|
Segment Information
|
Segment
|
Description
|
Wireless
|
Wireless’ communications products and services include wireless voice and data services and equipment sales, which are provided to consumer, business and government customers across the U.S.
|
Wireline
|
Wireline’s voice, data and video communications products and enhanced services include broadband video and data services, corporate networking solutions, security and managed network services and local and long distance voice services. We provide these products and services to consumers in the U.S., as well as to carriers, businesses and government customers both in the U.S. and around the world.
|
|
Three Months Ended
|
|
|||||
|
March 31,
|
|
|||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
External Operating Revenues
|
|
|
|
||||
Wireless
|
|
|
|
||||
Service
|
$
|
15,371
|
|
|
$
|
15,730
|
|
Equipment
|
5,040
|
|
|
3,764
|
|
||
Other
|
1,396
|
|
|
1,282
|
|
||
Total Wireless
|
21,807
|
|
|
20,776
|
|
||
|
|
|
|
||||
Wireline
|
|
|
|
||||
Consumer Markets
|
3,149
|
|
|
3,201
|
|
||
Enterprise Solutions
|
2,240
|
|
|
2,311
|
|
||
Partner Solutions
|
979
|
|
|
989
|
|
||
Business Markets
|
871
|
|
|
879
|
|
||
Other
|
67
|
|
|
61
|
|
||
Total Wireline
|
7,306
|
|
|
7,441
|
|
||
Total reportable segments
|
$
|
29,113
|
|
|
$
|
28,217
|
|
|
|
|
|
||||
Intersegment Revenues
|
|
|
|
||||
Wireless
|
$
|
93
|
|
|
$
|
102
|
|
Wireline
|
251
|
|
|
241
|
|
||
Total reportable segments
|
$
|
344
|
|
|
$
|
343
|
|
|
|
|
|
||||
Total Operating Revenues
|
|
|
|
||||
Wireless
|
$
|
21,900
|
|
|
$
|
20,878
|
|
Wireline
|
7,557
|
|
|
7,682
|
|
||
Total reportable segments
|
$
|
29,457
|
|
|
$
|
28,560
|
|
|
|
|
|
||||
Operating Income
|
|
|
|
||||
Wireless
|
$
|
8,049
|
|
|
$
|
7,076
|
|
Wireline
|
69
|
|
|
206
|
|
||
Total reportable segments
|
$
|
8,118
|
|
|
$
|
7,282
|
|
|
At March 31,
|
|
|
At December 31,
|
|
||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Assets
|
|
|
|
||||
Wireless
|
$
|
248,563
|
|
|
$
|
235,873
|
|
Wireline
|
76,740
|
|
|
75,282
|
|
||
Total reportable segments
|
325,303
|
|
|
311,155
|
|
||
Corporate and other
|
246,685
|
|
|
239,040
|
|
||
Eliminations
|
(307,472
|
)
|
|
(293,052
|
)
|
||
Total consolidated - reported
|
$
|
264,516
|
|
|
$
|
257,143
|
|
|
Three Months Ended
|
|
|||||
|
March 31,
|
|
|||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Total reportable segment operating revenues
|
$
|
29,457
|
|
|
$
|
28,560
|
|
Corporate and other
|
2,711
|
|
|
1,460
|
|
||
Eliminations
|
(396
|
)
|
|
(400
|
)
|
||
Operating results from divested businesses
|
—
|
|
|
194
|
|
||
Total consolidated operating revenues
|
$
|
31,772
|
|
|
$
|
29,814
|
|
|
Three Months Ended
|
|
|||||
|
March 31,
|
|
|||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Total reportable segment operating income
|
$
|
8,118
|
|
|
$
|
7,282
|
|
Corporate and other
|
(407
|
)
|
|
(315
|
)
|
||
Other components of net periodic benefit cost (income) (Note 9)
|
(255
|
)
|
|
(218
|
)
|
||
Acquisition and integration related charges (Note 3)
|
(107
|
)
|
|
—
|
|
||
Gain on spectrum license transaction (Note 3)
|
—
|
|
|
126
|
|
||
Operating results from divested businesses
|
—
|
|
|
87
|
|
||
Total consolidated operating income
|
7,349
|
|
|
6,962
|
|
||
|
|
|
|
||||
Equity in losses of unconsolidated businesses
|
(19
|
)
|
|
(21
|
)
|
||
Other expense, net
|
(75
|
)
|
|
(627
|
)
|
||
Interest expense
|
(1,201
|
)
|
|
(1,132
|
)
|
||
Income Before Provision For Income Taxes
|
$
|
6,054
|
|
|
$
|
5,182
|
|
12.
|
Commitments and Contingencies
|
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
Overview
|
•
|
Earnings of
$1.11
per share on a United States (U.S.) generally accepted accounting principles (GAAP) basis.
|
•
|
Total operating revenue of
$31.8 billion
.
|
•
|
Total operating income of
$7.3 billion
.
|
•
|
Net income of
$4.7 billion
.
|
•
|
Cash flow from operations of
$6.6 billion
.
|
•
|
Capital expenditures of
$4.6 billion
.
|
•
|
Total Wireless segment operating revenues for the three months ended March 31, 2018 totaled
$21.9 billion
, an increase of
4.9
% compared to the similar period in 2017.
|
•
|
Total Wireline segment operating revenues for the three months ended March 31, 2018 totaled
$7.6 billion
, a decrease of
1.6
% compared to the similar period in 2017.
|
•
|
Operating revenues for our Media business, branded Oath and included in Corporate and other, were $1.9 billion for the three months ended March 31, 2018, an increase of $1.2 billion compared to the similar period in 2017, primarily due to the acquisition of Yahoo! Inc.'s (Yahoo) operating business in June of 2017.
|
Consolidated Results of Operations
|
Consolidated Revenues
|
|
Three Months Ended
|
|
|
|
|
|
||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Wireless
|
$
|
21,900
|
|
|
$
|
20,878
|
|
|
$
|
1,022
|
|
|
4.9
|
%
|
Wireline
|
7,557
|
|
|
7,682
|
|
|
(125
|
)
|
|
(1.6
|
)
|
|||
Corporate and other
|
2,711
|
|
|
1,654
|
|
|
1,057
|
|
|
63.9
|
|
|||
Eliminations
|
(396
|
)
|
|
(400
|
)
|
|
4
|
|
|
(1.0
|
)
|
|||
Consolidated Revenues
|
$
|
31,772
|
|
|
$
|
29,814
|
|
|
$
|
1,958
|
|
|
6.6
|
|
Consolidated Operating Expenses
|
|
Three Months Ended
|
|
|
|
|
|
||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Cost of services
|
$
|
7,946
|
|
|
$
|
7,239
|
|
|
$
|
707
|
|
|
9.8
|
%
|
Wireless cost of equipment
|
5,309
|
|
|
4,808
|
|
|
501
|
|
|
10.4
|
|
|||
Selling, general and administrative expense
|
6,844
|
|
|
6,746
|
|
|
98
|
|
|
1.5
|
|
|||
Depreciation and amortization expense
|
4,324
|
|
|
4,059
|
|
|
265
|
|
|
6.5
|
|
|||
Consolidated Operating Expenses
|
$
|
24,423
|
|
|
$
|
22,852
|
|
|
$
|
1,571
|
|
|
6.9
|
|
|
Three Months Ended
|
|
|||||
|
March 31,
|
|
|||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Operating Results From Divested Businesses
|
|
|
|
||||
Operating revenues
|
$
|
—
|
|
|
$
|
194
|
|
Cost of services
|
—
|
|
|
61
|
|
||
Selling, general and administrative expense
|
—
|
|
|
29
|
|
||
Depreciation and amortization expense
|
—
|
|
|
17
|
|
Other Consolidated Results
|
|
Three Months Ended
|
|
|
|
|
|
||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Interest income
|
$
|
16
|
|
|
$
|
14
|
|
|
$
|
2
|
|
|
14.3
|
%
|
Other components of net periodic benefit cost
|
255
|
|
|
218
|
|
|
37
|
|
|
17.0
|
|
|||
Other, net
|
(346
|
)
|
|
(859
|
)
|
|
513
|
|
|
59.7
|
|
|||
Total
|
$
|
(75
|
)
|
|
$
|
(627
|
)
|
|
$
|
552
|
|
|
88.0
|
|
|
Three Months Ended
|
|
|
|
|
|
||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Total interest costs on debt balances
|
$
|
1,377
|
|
|
$
|
1,307
|
|
|
$
|
70
|
|
|
5.4
|
%
|
Less capitalized interest costs
|
176
|
|
|
175
|
|
|
1
|
|
|
0.6
|
|
|||
Total
|
$
|
1,201
|
|
|
$
|
1,132
|
|
|
$
|
69
|
|
|
6.1
|
|
|
|
|
|
|
|
|
|
|||||||
Average debt outstanding
|
$
|
117,973
|
|
|
$
|
111,390
|
|
|
|
|
|
|||
Effective interest rate
|
4.7
|
%
|
|
4.7
|
%
|
|
|
|
|
|
Three Months Ended
|
|
|
|
||||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Provision for income taxes
|
$
|
1,388
|
|
|
$
|
1,629
|
|
|
$
|
(241
|
)
|
|
(14.8
|
)%
|
Effective income tax rate
|
22.9
|
%
|
|
31.4
|
%
|
|
|
|
|
Consolidated Net Income, Operating Income and EBITDA
|
|
Three Months Ended
|
|
|||||
|
March 31,
|
|
|||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Consolidated Net Income
|
$
|
4,666
|
|
|
$
|
3,553
|
|
Add (Less):
|
|
|
|
||||
Provision for income taxes
|
1,388
|
|
|
1,629
|
|
||
Interest expense
|
1,201
|
|
|
1,132
|
|
||
Other (income) expense, net
|
75
|
|
|
627
|
|
||
Equity in losses of unconsolidated businesses
|
19
|
|
|
21
|
|
||
Consolidated Operating Income
|
$
|
7,349
|
|
|
$
|
6,962
|
|
Add Depreciation and amortization expense
|
4,324
|
|
|
4,059
|
|
||
Consolidated EBITDA
|
$
|
11,673
|
|
|
$
|
11,021
|
|
|
|
|
|
||||
Add (Less):
|
|
|
|
||||
Acquisition and integration related charges
|
$
|
105
|
|
|
$
|
—
|
|
Gain on spectrum license transaction
|
—
|
|
|
(126
|
)
|
||
Consolidated Adjusted EBITDA
|
$
|
11,778
|
|
|
$
|
10,895
|
|
Segment Results of Operations
|
Wireless
|
|
Three Months Ended
|
|
|
|
||||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions, except ARPA and I-ARPA)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Service
|
$
|
15,402
|
|
|
$
|
15,778
|
|
|
$
|
(376
|
)
|
|
(2.4
|
)%
|
Equipment
|
5,040
|
|
|
3,764
|
|
|
1,276
|
|
|
33.9
|
|
|||
Other
|
1,458
|
|
|
1,336
|
|
|
122
|
|
|
9.1
|
|
|||
Total Operating Revenues
|
$
|
21,900
|
|
|
$
|
20,878
|
|
|
$
|
1,022
|
|
|
4.9
|
|
|
|
|
|
|
|
|
|
|||||||
Connections (‘000):
(1)
|
|
|
|
|
|
|
|
|||||||
Retail
|
116,182
|
|
|
113,913
|
|
|
2,269
|
|
|
2.0
|
|
|||
Retail postpaid
|
111,114
|
|
|
108,483
|
|
|
2,631
|
|
|
2.4
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Net additions in period (‘000):
(2)
|
|
|
|
|
|
|
|
|||||||
Retail connections
|
(75
|
)
|
|
(324
|
)
|
|
249
|
|
|
76.9
|
|
|||
Retail postpaid connections
|
260
|
|
|
(307
|
)
|
|
567
|
|
|
nm
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Churn Rate:
|
|
|
|
|
|
|
|
|||||||
Retail connections
|
1.28
|
%
|
|
1.39
|
%
|
|
|
|
|
|||||
Retail postpaid connections
|
1.04
|
%
|
|
1.15
|
%
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|||||||
Account Statistics:
|
|
|
|
|
|
|
|
|||||||
Retail postpaid ARPA
(3)
|
$
|
131.71
|
|
|
$
|
136.98
|
|
|
$
|
(5.27
|
)
|
|
(3.8
|
)
|
Retail postpaid I-ARPA
(3)
|
$
|
164.72
|
|
|
$
|
166.01
|
|
|
$
|
(1.29
|
)
|
|
(0.8
|
)
|
|
|
|
|
|
|
|
|
|||||||
Retail postpaid accounts (‘000)
(1)
|
35,333
|
|
|
35,270
|
|
|
63
|
|
|
0.2
|
|
|||
Retail postpaid connections per account
(1)
|
3.14
|
|
|
3.08
|
|
|
0.06
|
|
|
1.9
|
|
(1)
|
As of end of period
|
(2)
|
Excluding acquisitions and adjustments
|
(3)
|
ARPA and I-ARPA for periods beginning after January 1, 2018 reflect the adoption of Topic 606. ARPA and I-ARPA for periods ending prior to January 1, 2018 were calculated based on the guidance per ASC Topic 605, "Revenue Recognition". Accordingly, amounts are not calculated on a comparative basis.
|
|
Three Months Ended
|
|
|
|
||||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Cost of services
|
$
|
2,215
|
|
|
$
|
2,187
|
|
|
$
|
28
|
|
|
1.3
|
%
|
Cost of equipment
|
5,309
|
|
|
4,808
|
|
|
501
|
|
|
10.4
|
|
|||
Selling, general and administrative expense
|
3,899
|
|
|
4,469
|
|
|
(570
|
)
|
|
(12.8
|
)
|
|||
Depreciation and amortization expense
|
2,428
|
|
|
2,338
|
|
|
90
|
|
|
3.8
|
|
|||
Total Operating Expenses
|
$
|
13,851
|
|
|
$
|
13,802
|
|
|
$
|
49
|
|
|
0.4
|
|
|
Three Months Ended
|
|
|
|
||||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Segment Operating Income
|
$
|
8,049
|
|
|
$
|
7,076
|
|
|
$
|
973
|
|
|
13.8
|
%
|
Add Depreciation and amortization expense
|
2,428
|
|
|
2,338
|
|
|
90
|
|
|
3.8
|
|
|||
Segment EBITDA
|
$
|
10,477
|
|
|
$
|
9,414
|
|
|
$
|
1,063
|
|
|
11.3
|
|
Segment operating income margin
|
36.8
|
%
|
|
33.9
|
%
|
|
|
|
|
|||||
Segment EBITDA margin
|
47.8
|
%
|
|
45.1
|
%
|
|
|
|
|
Wireline
|
|
Three Months Ended
|
|
|
|
|
|
||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Consumer Markets
|
$
|
3,150
|
|
|
$
|
3,201
|
|
|
$
|
(51
|
)
|
|
(1.6
|
)%
|
Enterprise Solutions
|
2,240
|
|
|
2,311
|
|
|
(71
|
)
|
|
(3.1
|
)
|
|||
Partner Solutions
|
1,228
|
|
|
1,229
|
|
|
(1
|
)
|
|
(0.1
|
)
|
|||
Business Markets
|
871
|
|
|
879
|
|
|
(8
|
)
|
|
(0.9
|
)
|
|||
Other
|
68
|
|
|
62
|
|
|
6
|
|
|
9.7
|
|
|||
Total Operating Revenues
|
$
|
7,557
|
|
|
$
|
7,682
|
|
|
$
|
(125
|
)
|
|
(1.6
|
)
|
|
|
|
|
|
|
|
|
|||||||
Connections (‘000):
(1)
|
|
|
|
|
|
|
|
|||||||
Total voice connections
|
12,555
|
|
|
13,634
|
|
|
(1,079
|
)
|
|
(7.9
|
)
|
|||
|
|
|
|
|
|
|
|
|||||||
Total Broadband connections
|
6,966
|
|
|
7,011
|
|
|
(45
|
)
|
|
(0.6
|
)
|
|||
Fios Internet connections
|
5,916
|
|
|
5,688
|
|
|
228
|
|
|
4.0
|
|
|||
Fios Video connections
|
4,597
|
|
|
4,681
|
|
|
(84
|
)
|
|
(1.8
|
)
|
(1)
|
As of end of period
|
|
Three Months Ended
|
|
|
|
||||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Cost of services
|
$
|
4,475
|
|
|
$
|
4,419
|
|
|
$
|
56
|
|
|
1.3
|
%
|
Selling, general and administrative expense
|
1,479
|
|
|
1,582
|
|
|
(103
|
)
|
|
(6.5
|
)
|
|||
Depreciation and amortization expense
|
1,534
|
|
|
1,475
|
|
|
59
|
|
|
4.0
|
|
|||
Total Operating Expenses
|
$
|
7,488
|
|
|
$
|
7,476
|
|
|
$
|
12
|
|
|
0.2
|
|
|
Three Months Ended
|
|
|
|
||||||||||
|
March 31,
|
|
|
Increase/
|
||||||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
(Decrease)
|
|||||||
Segment Operating Income (Loss)
|
$
|
69
|
|
|
$
|
206
|
|
|
$
|
(137
|
)
|
|
(66.5
|
)%
|
Add Depreciation and amortization expense
|
1,534
|
|
|
1,475
|
|
|
59
|
|
|
4.0
|
|
|||
Segment EBITDA
|
$
|
1,603
|
|
|
$
|
1,681
|
|
|
$
|
(78
|
)
|
|
(4.6
|
)
|
|
|
|
|
|
|
|
|
|||||||
Segment operating income (loss) margin
|
0.9
|
%
|
|
2.7
|
%
|
|
|
|
|
|||||
Segment EBITDA margin
|
21.2
|
%
|
|
21.9
|
%
|
|
|
|
|
Special Items
|
|
Three Months Ended
|
|
|||||
|
March 31,
|
|
|||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Acquisition and integration related charges
|
|
|
|
||||
Selling, general and administrative expense
|
$
|
105
|
|
|
$
|
—
|
|
Depreciation and amortization
|
2
|
|
|
—
|
|
||
Gain on spectrum license transaction
|
|
|
|
||||
Selling, general and administrative expense
|
—
|
|
|
(126
|
)
|
||
Early debt redemption costs
|
|
|
|
||||
Other expense, net
|
249
|
|
|
848
|
|
||
Total
|
$
|
356
|
|
|
$
|
722
|
|
|
Three Months Ended
|
|
|||||
|
March 31,
|
|
|||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Within Total Operating Expenses
|
$
|
107
|
|
|
$
|
(126
|
)
|
Within Other expense, net
|
249
|
|
|
848
|
|
||
Total
|
$
|
356
|
|
|
$
|
722
|
|
Acquisition and Integration Related Charges
|
Gain on Spectrum License Transaction
|
Early Debt Redemption Costs
|
Consolidated Financial Condition
|
|
Three Months Ended
|
|
|
|
|||||||
|
March 31,
|
|
|
|
|||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
Change
|
|
|||
Cash Flows Provided By (Used In)
|
|
|
|
|
|
||||||
Operating activities
|
$
|
6,648
|
|
|
$
|
1,376
|
|
|
$
|
5,272
|
|
Investing activities
|
(5,285
|
)
|
|
(4,550
|
)
|
|
(735
|
)
|
|||
Financing activities
|
(1,316
|
)
|
|
4,665
|
|
|
(5,981
|
)
|
|||
Increase In Cash, Cash Equivalents and Restricted Cash
|
$
|
47
|
|
|
$
|
1,491
|
|
|
$
|
(1,444
|
)
|
Cash Flows Provided By Operating Activities
|
Cash Flows Used In Investing Activities
|
|
Three Months Ended
|
|
|||||
|
March 31,
|
|
|||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
||
Wireless
|
$
|
2,367
|
|
|
$
|
1,831
|
|
Wireline
|
1,673
|
|
|
960
|
|
||
Other
|
512
|
|
|
276
|
|
||
Capital expenditures
|
$
|
4,552
|
|
|
$
|
3,067
|
|
Total as a percentage of revenue
|
14.3
|
%
|
|
10.3
|
%
|
Cash Flows Provided by (Used In) Financing Activities
|
Change In Cash, Cash Equivalents and Restricted Cash
|
|
Three Months Ended
|
|
|
|
|||||||
|
March 31,
|
|
|
|
|||||||
(dollars in millions)
|
2018
|
|
|
2017
|
|
|
Change
|
|
|||
Net cash provided by operating activities
|
$
|
6,648
|
|
|
$
|
1,376
|
|
|
$
|
5,272
|
|
Less Capital expenditures (including capitalized software)
|
4,552
|
|
|
3,067
|
|
|
1,485
|
|
|||
Free cash flow
|
$
|
2,096
|
|
|
$
|
(1,691
|
)
|
|
$
|
3,787
|
|
Market Risk
|
Interest Rate Risk
|
Foreign Currency Translation
|
Acquisitions and Divestitures
|
Other Factors That May Affect Future Results
|
Regulatory and Competitive Trends
|
Environmental Matters
|
Recently Issued Accounting Standards
|
Cautionary Statement Concerning Forward-Looking Statements
|
•
|
adverse conditions in the U.S. and international economies;
|
•
|
the effects of competition in the markets in which we operate;
|
•
|
material changes in technology or technology substitution;
|
•
|
disruption of our key suppliers’ provisioning of products or services;
|
•
|
changes in the regulatory environment in which we operate, including any increase in restrictions on our ability to operate our networks;
|
•
|
breaches of network or information technology security, natural disasters, terrorist attacks or acts of war or significant litigation and any resulting financial impact not covered by insurance;
|
•
|
our high level of indebtedness;
|
•
|
an adverse change in the ratings afforded our debt securities by nationally accredited ratings organizations or adverse conditions in the credit markets affecting the cost, including interest rates, and/or availability of further financing;
|
•
|
material adverse changes in labor matters, including labor negotiations, and any resulting financial and/or operational impact;
|
•
|
significant increases in benefit plan costs or lower investment returns on plan assets;
|
•
|
changes in tax laws or treaties, or in their interpretation;
|
•
|
changes in accounting assumptions that regulatory agencies, including the SEC, may require or that result from changes in the accounting rules or their application, which could result in an impact on earnings;
|
•
|
the inability to implement our business strategies; and
|
•
|
the inability to realize the expected benefits of strategic transactions.
|
Part II – Other Information
|
Exhibit
Number
|
|
Description
|
|
|
|
10a
|
|
Form of 2018 Performance Stock Unit Agreement pursuant to the 2017 Verizon Communications Inc. Long-Term Incentive Plan.
|
|
|
|
10b
|
|
Form of 2018 Restricted Stock Unit Agreement pursuant to the 2017 Verizon Communications Inc. Long-Term Incentive Plan.
|
|
|
|
12
|
|
Computation of Ratio of Earnings to Fixed Charges.
|
|
|
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
32.1
|
|
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
32.2
|
|
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
101.INS
|
|
XBRL Instance Document.
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Presentation Linkbase Document.
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Calculation Linkbase Document.
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Label Linkbase Document.
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
Signature
|
|
|
VERIZON COMMUNICATIONS INC.
|
||
|
|
|
||
Date: May 1, 2018
|
|
By
|
|
/s/ Anthony T. Skiadas
|
|
|
|
|
Anthony T. Skiadas
|
|
|
|
|
Senior Vice President and Controller
|
|
|
|
|
(Principal Accounting Officer)
|
Exhibit
Number
|
|
Description
|
|
|
|
|
Form of 2018 Performance Stock Unit Agreement pursuant to the 2017 Verizon Communications Inc. Long-Term Incentive Plan.
|
|
|
|
|
|
Form of 2018 Restricted Stock Unit Agreement pursuant to the 2017 Verizon Communications Inc. Long-Term Incentive Plan.
|
|
|
|
|
|
Computation of Ratio of Earnings to Fixed Charges.
|
|
|
|
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
101.INS
|
|
XBRL Instance Document.
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Presentation Linkbase Document.
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Calculation Linkbase Document.
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Label Linkbase Document.
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
(a)
|
You acknowledge that the geographic boundaries, scope of prohibited activities, and time duration of the restrictions set forth in paragraphs 1 and 2 above are reasonable in nature and are no broader than are necessary to maintain the confidential information, trade secrets and the goodwill of the Company and its Related Companies and to protect the other legitimate business interests of the Company and its Related Companies and are not unduly restrictive on you. In addition, you and the Company agree and intend that the covenants contained in paragraphs 1 and 2 shall be deemed to be a series of separate covenants and agreements, one for each and
|
(b)
|
You shall indicate your agreement to the obligations and restrictions set forth in this Exhibit B in accordance with the instructions provided in the Agreement, and your acceptance of the Agreement shall include your acceptance of such obligations and restrictions. As stated in paragraph 21 of the Agreement, you and Verizon hereby expressly agree that the use of electronic media to indicate confirmation, consent, signature, acceptance, agreement and delivery shall be legally valid and have the same legal force and effect as if you and Verizon executed this Exhibit B in paper form.
|
(a)
|
You acknowledge that the geographic boundaries, scope of prohibited activities, and time duration of the restrictions set forth in paragraphs 1 and 2 above are reasonable in nature and are no broader than are necessary to maintain the confidential information, trade secrets and the goodwill of the Company and its Related Companies and to protect the other legitimate business interests of the Company and its Related Companies and are not unduly restrictive on you. In addition, you and the Company agree and intend that the covenants contained in paragraphs 1 and 2 shall be deemed to be a series of separate covenants and agreements, one for each and every county or political subdivision of each applicable state of the United States and each country of the world.
|
(b)
|
You shall indicate your agreement to the obligations and restrictions set forth in this Exhibit B in accordance with the instructions provided in the Agreement, and your acceptance of the Agreement shall include your acceptance of such obligations and restrictions. As stated in paragraph 21 of the Agreement, you and Verizon hereby expressly agree that the use of electronic media to indicate confirmation, consent, signature, acceptance, agreement and delivery shall be legally valid and have the same legal force and effect as if you and Verizon executed this Exhibit B in paper form.
|
(dollars in millions)
|
Three Months Ended
|
|
|
March 31,
|
|
||
2018
|
|
||
Earnings:
|
|
||
Income before provision for income taxes
|
$
|
6,054
|
|
Equity in losses of unconsolidated businesses
|
19
|
|
|
Dividends from unconsolidated businesses
|
11
|
|
|
Interest expense
(1)
|
1,201
|
|
|
Portion of rent expense representing interest
|
336
|
|
|
Amortization of capitalized interest
|
48
|
|
|
Earnings, as adjusted
|
$
|
7,669
|
|
|
|
||
Fixed Charges:
|
|
||
Interest expense
(1)
|
$
|
1,201
|
|
Portion of rent expense representing interest
|
336
|
|
|
Capitalized interest
|
176
|
|
|
Fixed charges
|
$
|
1,713
|
|
|
|
||
Ratio of earnings to fixed charges
|
4.48
|
|
|
|
|
||
(1)
We classify interest expense recognized on uncertain tax positions as income tax expense and therefore such interest expense is not included in the Ratio of Earnings to Fixed Charges.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Verizon Communications Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: May 1, 2018
|
/s/ Lowell C. McAdam
|
|
Lowell C. McAdam
|
|
Chairman and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Verizon Communications Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: May 1, 2018
|
/s/ Matthew D. Ellis
|
|
Matthew D. Ellis
|
|
Executive Vice President and Chief Financial Officer
|
(1)
|
the report of the Company on Form 10-Q for the quarterly period ending
March 31, 2018
(the Report) fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934 (the Exchange Act); and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods referred to in the Report.
|
Date: May 1, 2018
|
/s/ Lowell C. McAdam
|
|
Lowell C. McAdam
|
|
Chairman and Chief Executive Officer
|
(1)
|
the report of the Company on Form 10-Q for the quarterly period ending
March 31, 2018
(the Report) fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934 (the Exchange Act); and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods referred to in the Report.
|
Date: May 1, 2018
|
/s/ Matthew D. Ellis
|
|
Matthew D. Ellis
|
|
Executive Vice President and Chief Financial Officer
|