Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 16, 2018 | Jun. 30, 2017 | |
Document and Entity Information | |||
Entity Registrant Name | CENTURYLINK, INC | ||
Entity Central Index Key | 18,926 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 11.7 | ||
Entity Common Stock, Shares Outstanding (shares) | 1,069,861,684 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | |||||||||||
OPERATING REVENUES | $ 5,323 | $ 4,034 | $ 4,090 | $ 4,209 | $ 4,289 | $ 4,382 | $ 4,398 | $ 4,401 | $ 17,656 | $ 17,470 | $ 17,900 |
OPERATING EXPENSES | |||||||||||
Cost of services and products (exclusive of depreciation and amortization) | 8,203 | 7,774 | 7,778 | ||||||||
Selling, general and administrative | 3,508 | 3,447 | 3,354 | ||||||||
Depreciation and amortization | 3,936 | 3,916 | 4,189 | ||||||||
Total operating expenses | 15,647 | 15,137 | 15,321 | ||||||||
OPERATING INCOME | 524 | 487 | 367 | 631 | 405 | 593 | 647 | 688 | 2,009 | 2,333 | 2,579 |
OTHER (EXPENSE) INCOME | |||||||||||
Interest expense | (1,481) | (1,318) | (1,312) | ||||||||
Other income, net | 12 | 5 | 49 | ||||||||
Total other expense, net | (1,469) | (1,313) | (1,263) | ||||||||
INCOME BEFORE INCOME TAX EXPENSE | 540 | 1,020 | 1,316 | ||||||||
Income tax (benefit) expense | (849) | 394 | 438 | ||||||||
NET INCOME | $ 1,117 | $ 92 | $ 17 | $ 163 | $ 42 | $ 152 | $ 196 | $ 236 | $ 1,389 | $ 626 | $ 878 |
BASIC AND DILUTED EARNINGS PER COMMON SHARE | |||||||||||
BASIC (in dollars per share) | $ 1.26 | $ 0.17 | $ 0.03 | $ 0.30 | $ 0.08 | $ 0.28 | $ 0.36 | $ 0.44 | $ 2.21 | $ 1.16 | $ 1.58 |
DILUTED (in dollars per share) | $ 1.26 | $ 0.17 | $ 0.03 | $ 0.30 | $ 0.08 | $ 0.28 | $ 0.36 | $ 0.44 | $ 2.21 | $ 1.16 | $ 1.58 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | |||||||||||
BASIC (in shares) | 627,808 | 539,549 | 554,278 | ||||||||
DILUTED (in shares) | 628,693 | 540,679 | 555,093 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 1,389 | $ 626 | $ 878 |
Items related to employee benefit plans: | |||
Change in net actuarial gain (loss), net of $(60), $113 and $(12) tax | 83 | (168) | 21 |
Change in net prior service credit, net of $(4), $(4) and $(47) tax | 8 | 6 | 76 |
Foreign currency translation adjustment and other, net of $(17), $— and $— tax | 31 | (21) | (14) |
Net current-period other comprehensive income (loss) | 122 | (183) | 83 |
COMPREHENSIVE INCOME | $ 1,511 | $ 443 | $ 961 |
CONSOLIDATED STATEMENTS OF COM4
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Change in net actuarial (loss) gain, tax benefit (expense) | $ (60) | $ 113 | $ (12) |
Change in net prior service credit (costs), tax (expense) benefit | (4) | (4) | (47) |
Foreign currency translation adjustment and other, tax benefit | $ (17) | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 551 | $ 222 |
Restricted cash - current | 5 | 0 |
Accounts receivable, less allowance of $164 and $178 | 2,557 | 2,017 |
Assets held for sale | 140 | 2,376 |
Other | 941 | 547 |
Total current assets | 4,194 | 5,162 |
NET PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | 51,204 | 39,194 |
Accumulated depreciation | (24,352) | (22,155) |
Net property, plant and equipment | 26,852 | 17,039 |
GOODWILL AND OTHER ASSETS | ||
Goodwill | 30,475 | 19,650 |
Restricted cash | 31 | 2 |
Other intangible assets, net | 1,897 | 1,531 |
Other, net | 1,286 | 836 |
Total goodwill and other assets | 44,565 | 24,816 |
TOTAL ASSETS | 75,611 | 47,017 |
CURRENT LIABILITIES | ||
Current maturities of long-term debt | 443 | 1,503 |
Accounts payable | 1,555 | 1,179 |
Accrued expenses and other liabilities | ||
Salaries and benefits | 890 | 802 |
Income and other taxes | 370 | 301 |
Interest | 363 | 260 |
Other | 344 | 213 |
Current liabilities associated with assets held for sale | 0 | 419 |
Advance billings and customer deposits | 892 | 672 |
Total current liabilities | 4,857 | 5,349 |
LONG-TERM DEBT | 37,283 | 18,185 |
DEFERRED CREDITS AND OTHER LIABILITIES | ||
Deferred income taxes, net | 2,413 | 3,471 |
Benefit plan obligations, net | 5,178 | 5,527 |
Other | 2,389 | 1,086 |
Total deferred credits and other liabilities | 9,980 | 10,084 |
COMMITMENTS AND CONTINGENCIES (Note 16) | ||
STOCKHOLDERS' EQUITY | ||
Preferred stock — non-redeemable, $25.00 par value, authorized 2,000 and 2,000 shares, issued and outstanding 7 and 7 shares | 0 | 0 |
Common stock, $1.00 par value, authorized 1,600,000 and 1,600,000 shares, issued and outstanding 1,069,169 and 546,545 shares | 1,069 | 547 |
Additional paid-in capital | 23,314 | 14,970 |
Accumulated other comprehensive loss | (1,995) | (2,117) |
Retained earnings (accumulated deficit) | 1,103 | (1) |
Total stockholders' equity | 23,491 | 13,399 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 75,611 | 47,017 |
Customer relationships | ||
Customer relationships, net | $ 10,876 | $ 2,797 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance | $ 164 | $ 178 |
Preferred stock-non-redeemable, par value (in dollars per share) | $ 25 | $ 25 |
Preferred stock-non-redeemable, authorized shares (shares) | 2,000 | 2,000 |
Preferred stock-non-redeemable, issued shares (shares) | 7 | 7 |
Preferred stock-non-redeemable, outstanding shares (shares) | 7 | 7 |
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, authorized shares (shares) | 1,600,000 | 1,600,000 |
Common stock, issued shares (shares) | 1,069,169 | 546,545 |
Common stock, outstanding shares (shares) | 1,069,169 | 546,545 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
OPERATING ACTIVITIES | |||
Net income | $ 1,389 | $ 626 | $ 878 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 3,936 | 3,916 | 4,189 |
Impairment of assets | 0 | 13 | 9 |
Deferred income taxes | (931) | 6 | 350 |
Loss on the sale of data centers and colocation business | 82 | 0 | 0 |
Provision for uncollectible accounts | 176 | 192 | 177 |
Net long-term debt issuance costs and premium amortization | 9 | 2 | (3) |
Net loss on early retirement of debt | 5 | 27 | 0 |
Share-based compensation | 111 | 80 | 73 |
Changes in current assets and liabilities: | |||
Accounts receivable | 31 | (266) | (132) |
Accounts payable | (123) | 109 | (168) |
Accrued income and other taxes | 54 | (43) | 32 |
Other current assets and liabilities, net | (614) | 92 | (53) |
Retirement benefits | (202) | (152) | (141) |
Changes in other noncurrent assets and liabilities, net | (174) | (18) | (77) |
Other, net | 129 | 24 | 19 |
Net cash provided by operating activities | 3,878 | 4,608 | 5,153 |
INVESTING ACTIVITIES | |||
Payments for property, plant and equipment and capitalized software | (3,106) | (2,981) | (2,872) |
Cash paid for Level 3 acquisition, net of $2.3 billion cash acquired | (7,289) | 0 | 0 |
Cash paid for other acquisitions | (5) | (39) | (4) |
Proceeds from sale of property and intangible assets | 1,529 | 30 | 31 |
Other, net | 0 | (4) | (8) |
Net cash used in investing activities | (8,871) | (2,994) | (2,853) |
FINANCING ACTIVITIES | |||
Net proceeds from issuance of long-term debt | 8,398 | 2,161 | 989 |
Proceeds from financing obligation (Note 3) | 356 | 0 | 0 |
Payments of long-term debt | (1,963) | (2,462) | (966) |
Net proceeds from credit facility and revolving line of credit | 35 | ||
Net payments on credit facility and revolving line of credit | (40) | (315) | |
Dividends paid | (1,453) | (1,167) | (1,198) |
Repurchase of common stock and shares withheld to satisfy tax withholdings | (17) | (16) | (819) |
Other, net | 2 | 6 | 8 |
Net cash provided by (used in) financing activities | 5,358 | (1,518) | (2,301) |
Effect of exchange rate changes on cash and cash equivalents | (2) | 0 | 0 |
Net increase (decrease) in cash, cash equivalents and restricted cash | 363 | 96 | (1) |
Cash, cash equivalents and restricted cash at beginning of period | 224 | 128 | 129 |
Cash, cash equivalents and restricted cash at end of period | 587 | 224 | 128 |
Supplemental cash flow information: | |||
Income taxes paid, net | (392) | (397) | (63) |
Interest paid (net of capitalized interest of $78, $54 and $52) | $ (1,401) | $ (1,301) | $ (1,310) |
CONSOLIDATED STATEMENTS OF CAS8
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Cash Flows [Abstract] | |||
Interest paid capitalized interest | $ 78 | $ 54 | $ 52 |
Cash acquired for Level 3 acquisition | $ 2,300 | $ 0 | $ 0 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Millions | Total | COMMON STOCK (represents dollars and shares) | ADDITIONAL PAID-IN CAPITAL | ACCUMULATED OTHER COMPREHENSIVE LOSS | RETAINED EARNINGS (ACCUMULATED DEFICIT) |
Balance at beginning of period at Dec. 31, 2014 | $ 569 | $ 16,324 | $ (2,017) | $ 147 | |
Increase (Decrease) in Stockholders' Equity | |||||
Issuance of common stock to acquire Level 3, including replacement of Level 3's share-based compensation awards | 0 | 0 | |||
Issuance of common stock through dividend reinvestment, incentive and benefit plans | 2 | 9 | |||
Repurchase of common stock | (27) | (767) | |||
Shares withheld to satisfy tax withholdings | (19) | ||||
Share-based compensation and other, net | 77 | ||||
Dividends declared | (446) | (753) | |||
Other comprehensive income (loss) | $ 83 | 83 | |||
Net income | 878 | 878 | |||
Balance at end of period at Dec. 31, 2015 | 14,060 | 544 | 15,178 | (1,934) | 272 |
Increase (Decrease) in Stockholders' Equity | |||||
Cumulative effect of adoption of ASU 2016-09, Improvements to Employee Share-Based Payment Accounting | Restatement adjustment | Accounting Standards Update 2016-09 | 0 | ||||
Issuance of common stock to acquire Level 3, including replacement of Level 3's share-based compensation awards | 0 | 0 | |||
Issuance of common stock through dividend reinvestment, incentive and benefit plans | 3 | 7 | |||
Repurchase of common stock | 0 | 0 | |||
Shares withheld to satisfy tax withholdings | (15) | ||||
Share-based compensation and other, net | 79 | ||||
Dividends declared | (279) | (899) | |||
Other comprehensive income (loss) | (183) | (183) | |||
Net income | 626 | 626 | |||
Balance at end of period at Dec. 31, 2016 | 13,399 | 547 | 14,970 | (2,117) | (1) |
Increase (Decrease) in Stockholders' Equity | |||||
Cumulative effect of adoption of ASU 2016-09, Improvements to Employee Share-Based Payment Accounting | Restatement adjustment | Accounting Standards Update 2016-09 | 0 | ||||
Issuance of common stock to acquire Level 3, including replacement of Level 3's share-based compensation awards | 517 | 9,462 | |||
Issuance of common stock through dividend reinvestment, incentive and benefit plans | 5 | 0 | |||
Repurchase of common stock | 0 | 0 | |||
Shares withheld to satisfy tax withholdings | (20) | ||||
Share-based compensation and other, net | 79 | ||||
Dividends declared | (1,177) | (288) | |||
Other comprehensive income (loss) | 122 | 122 | |||
Net income | 1,389 | 1,389 | |||
Balance at end of period at Dec. 31, 2017 | $ 23,491 | $ 1,069 | $ 23,314 | $ (1,995) | 1,103 |
Increase (Decrease) in Stockholders' Equity | |||||
Cumulative effect of adoption of ASU 2016-09, Improvements to Employee Share-Based Payment Accounting | Restatement adjustment | Accounting Standards Update 2016-09 | $ 3 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Background and Summary of Significant Accounting Policies General We are an international facilities-based communications company engaged primarily in providing an integrated array of services to our residential and business customers. Our communications services include local and long-distance voice, virtual private network ("VPN") data network, private line (including business data services), Ethernet, information technology, wavelength, broadband, colocation and data center services, managed services, professional and other services provided in connection with selling equipment, network security and various other ancillary services. On November 1, 2017, we acquired Level 3 Communications, Inc. ("Level 3") in a cash and stock transaction. See Note 2—Acquisition of Level 3 for additional information. On May 1, 2017, we sold our data centers and colocation business to a consortium led by BC Partners, Inc. and Medina Capital for a combination of cash and equity. See Note 3—Sale of Data Centers and Colocation Business for additional information. Basis of Presentation The accompanying consolidated financial statements include our accounts and the accounts of our subsidiaries. These subsidiaries include Level 3 on and after November 1, 2017. Intercompany amounts and transactions with our consolidated subsidiaries have been eliminated. In connection with our acquisition of Level 3, we acquired its deconsolidated Venezuela subsidiary and due to exchange restrictions and other conditions we have assigned no value to the assets acquired. Additionally, we have excluded this subsidiary from our consolidated financial statements. To simplify the overall presentation of our consolidated financial statements, we report immaterial amounts attributable to noncontrolling interests in certain of our subsidiaries as follows: (i) income attributable to noncontrolling interests in other income (expense), net, (ii) equity attributable to noncontrolling interests in additional paid-in capital and (iii) cash flows attributable to noncontrolling interests in other, net financing activities. We reclassified certain prior period amounts to conform to the current period presentation, including the categorization of our revenues and our segment reporting for 2016 and 2015. See Note 14—Segment Information for additional information. These changes had no impact on total operating revenues, total operating expenses or net income for any period. Changes in Estimates In 2016, we changed the method we use to estimate the service and interest components of net periodic benefit expense for pension and other postretirement benefit obligations. This change resulted in a decrease in the service and interest components in 2017 and 2016. Beginning in 2016, we utilized a full yield curve approach in connection with estimating these components by applying the specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows, as opposed to the single weighted-average discount rate derived from the yield curve that we have used in the past. We believe this change more precisely measures service and interest costs by improving the correlation between projected benefit cash flows to the corresponding spot yield curve rates. This change did not affect the measurement of our total benefit obligations but lowered our annual net periodic benefit cost by $122 million and $149 million in 2017 and 2016, respectively. This change was treated as a change in accounting estimate and accordingly, we did not adjust the amounts recorded in 2015. The reduction in expense described above, net of tax, increased net income by $75 million and $91 million , or $0.12 and $0.17 per basic and diluted common share, for the years ended December 31, 2017 and 2016, respectively. Summary of Significant Accounting Policies Use of Estimates Our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles. These accounting principles require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions we make when accounting for specific items and matters, including, but not limited to, investments, long-term contracts, customer retention patterns, allowance for doubtful accounts, depreciation, amortization, asset valuations, internal labor capitalization rates, recoverability of assets (including deferred tax assets), impairment assessments, pension, post-retirement and other post-employment benefits, taxes, certain liabilities and other provisions and contingencies, are reasonable, based on information available at the time they are made. These estimates, judgments and assumptions can materially affect the reported amounts of assets, liabilities and components of stockholders' equity as of the dates of the consolidated balance sheets, as well as the reported amounts of revenues, expenses and components of cash flows during the periods presented in our other consolidated financial statements. We also make estimates in our assessments of potential losses in relation to threatened or pending tax and legal matters. See Note 13—Income Taxes and Note 16—Commitments and Contingencies for additional information. For matters not related to income taxes, if a loss is considered probable and the amount can be reasonably estimated, we recognize an expense for the estimated loss. If we have the potential to recover a portion of the estimated loss from a third party, we make a separate assessment of recoverability and reduce the estimated loss if recovery is also deemed probable. For matters related to income taxes, if we determine that the impact of an uncertain tax position is more likely than not to be sustained upon audit by the relevant taxing authority, then we recognize a benefit for the largest amount that is more likely than not to be sustained. No portion of an uncertain tax position will be recognized if the position has less than a 50% likelihood of being sustained. Interest is recognized on the amount of unrecognized benefit from uncertain tax positions. For all of these and other matters, actual results could differ materially from our estimates. Revenue Recognition We recognize revenue for services when the related services are provided. Recognition of certain payments received in advance of services being provided is deferred until the service is provided. These advance payments include activation and installation charges, which we recognize as revenue over the expected customer relationship period, which ranges from three years to over seven years depending on the service. We also defer costs for customer activations and installations. The deferral of customer activation and installation costs is limited to the amount of revenue deferred on advance payments. Costs in excess of advance payments are recorded as expense in the period such costs are incurred. Expected customer relationship periods are estimated using historical experience. In most cases, termination fees or other fees on existing contracts that are negotiated in conjunction with new contracts are deferred and recognized over the new contract term. We offer bundle discounts to our customers who receive certain groupings of services. These bundle discounts are recognized concurrently with the associated revenue and are allocated to the various services in the bundled offering based on the estimated selling price of services included in each bundled combination. Customer arrangements that include both equipment and services are evaluated to determine whether the elements are separable. If the elements are deemed separable and separate earnings processes exist, the revenue associated with the customer arrangement is allocated to each element based on the relative estimated selling price of the separate elements. We have estimated the selling prices of each element by reference to vendor-specific objective evidence of selling prices when the elements are sold separately. The revenue associated with each element is then recognized as earned. For example, if we receive an advance payment when we sell equipment and continuing service together, we immediately recognize as revenue the amount allocated to the equipment as long as all the conditions for revenue recognition have been satisfied. The portion of the advance payment allocated to the service based upon its relative selling price is recognized ratably over the longer of the contractual period or the expected customer relationship period. We periodically transfer optical capacity assets on our network to other telecommunications service carriers. These transactions are structured as indefeasible rights of use, commonly referred to as IRUs, which are the exclusive right to use a specified amount of capacity or fiber for a specified term, typically 20 years. We account for the cash consideration received on transfers of optical capacity assets and on all of the other elements deliverable under an IRU, as revenue ratably over the term of the agreement. We do not recognize revenue on any contemporaneous exchanges of our optical capacity assets for other optical capacity assets. In connection with offering products and services provided by third-party vendors, we review the relationship between us, the vendor and the end customer to assess whether revenue should be reported on a gross or net basis. In assessing whether revenue should be reported on a gross or net basis, we consider whether we act as a principal in the transaction, take title to the products, have risk and rewards of ownership or act as an agent or broker. We have service level commitments pursuant to contracts with certain of our customers. To the extent that such service levels are not achieved or are otherwise disputed due to performance or service issues or other service interruptions or conditions, we will estimate the amount of credits to be issued and record a reduction to revenues, with a corresponding increase in the credit reserve. USF Surcharges, Gross Receipts Taxes and Other Surcharges In determining whether to include in our revenues and expenses the taxes and surcharges collected from customers and remitted to government authorities, including USF surcharges, sales, use, value added and some excise taxes, we assess, among other things, whether we are the primary obligor or principal taxpayer for the taxes assessed in each jurisdiction where we do business. In jurisdictions where we determine that we are the principal taxpayer, we record the surcharges on a gross basis and include them in our revenues and costs of services and products. In jurisdictions where we determine that we are merely a collection agent for the government authority, we record the taxes on a net basis and do not include them in our revenues and costs of services and products. Advertising Costs Costs related to advertising are expensed as incurred and included in selling, general and administrative expenses in our consolidated statements of operations. Our advertising expense was $218 million , $216 million and $210 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Legal Costs In the normal course of our business, we incur costs to hire and retain external legal counsel to advise us on regulatory, litigation and other matters. We expense these costs as the related services are received. Income Taxes We file a consolidated federal income tax return with our eligible subsidiaries. The provision for income taxes consists of an amount for taxes currently payable, an amount for tax consequences deferred to future periods and adjustments to our liabilities for uncertain tax positions. We record deferred income tax assets and liabilities reflecting future tax consequences attributable to tax net operating loss carryforwards ("NOLs"), tax credit carryforwards and differences between the financial statement carrying value of assets and liabilities and the tax bases of those assets and liabilities. Deferred taxes are computed using enacted tax rates expected to apply in the year in which the differences are expected to affect taxable income. The effect on deferred income tax assets and liabilities of a change in tax rate is recognized in earnings in the period that includes the enactment date. We establish valuation allowances when necessary to reduce deferred income tax assets to the amounts that we believe are more likely than not to be recovered. Each quarter we evaluate the need to retain all or a portion of the valuation allowance on our deferred tax assets. See Note 13—Income Taxes for additional information. Cash and Cash Equivalents Cash and cash equivalents include highly liquid investments that are readily convertible into cash and are not subject to significant risk from fluctuations in interest rates. As a result, the value at which cash and cash equivalents are reported in our consolidated financial statements approximates their fair value. In evaluating investments for classification as cash equivalents, we require that individual securities have original maturities of ninety days or less and that individual investment funds have dollar-weighted average maturities of ninety days or less. To preserve capital and maintain liquidity, we invest with financial institutions we deem to be of sound financial condition and in high quality and relatively risk-free investment products. Our cash investment policy limits the concentration of investments with specific financial institutions or among certain products and includes criteria related to credit worthiness of any particular financial institution. Book overdrafts occur when checks have been issued but have not been presented to our controlled disbursement bank accounts for payment. Disbursement bank accounts allow us to delay funding of issued checks until the checks are presented for payment. Until the issued checks are presented for payment, the book overdrafts are included in accounts payable on our consolidated balance sheet. This activity is included in the operating activities section in our consolidated statements of cash flows. Accounts Receivable and Allowance for Doubtful Accounts We record accounts receivable acquired in connection with our acquisitions based on their estimated fair value as of the applicable acquisition date. Accounts receivable are recognized based upon the amount due from customers for the services provided or at cost for purchased and other receivables less an allowance for doubtful accounts. The allowance for doubtful accounts receivable reflects our best estimate of probable losses inherent in our receivable portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other currently available evidence. We generally consider our accounts past due if they are outstanding over 30 days . Our collection process varies by the customer segment, amount of the receivable, and our evaluation of the customer's credit risk. Our past due accounts are written off against our allowance for doubtful accounts when collection is considered to be not probable. Any recoveries of accounts previously written off are generally recognized as a reduction in bad debt expense in the period received. The carrying value of accounts receivable net of the allowance for doubtful accounts approximates fair value. Property, Plant and Equipment We record property, plant and equipment acquired in connection with our acquisitions based on its estimated fair value as of its acquisition date plus the estimated value of any associated legally or contractually required retirement obligations. We record purchased and constructed property, plant and equipment at cost, plus the estimated value of any associated legally or contractually required retirement obligations. The majority of our property, plant and equipment is depreciated using the straight-line group method, but certain of our assets are depreciated using the straight-line method over their estimated useful lives. Under the straight-line group method, assets dedicated to providing telecommunications services (which comprise the majority of our property, plant and equipment) that have similar physical characteristics, use and expected useful lives are pooled for purposes of depreciation and tracking. The equal life group procedure is used to establish each pool's average remaining useful life. Generally, under the straight-line group method, when an asset is sold or retired in the course of normal business activities, the cost is deducted from property, plant and equipment and charged to accumulated depreciation without recognition of a gain or loss. A gain or loss is recognized in our consolidated statements of operations only if a disposal is unusual. Leasehold improvements are amortized over the shorter of the useful lives of the assets or the expected lease term. Expenditures for maintenance and repairs are expensed as incurred. Interest is capitalized during the construction phase of network and other internal-use capital projects. Employee-related costs for construction of network and other internal use assets are also capitalized during the construction phase. Property, plant and equipment supplies used internally are carried at average cost, except for significant individual items for which cost is based on specific identification. We perform annual internal reviews to evaluate the reasonableness of the depreciable lives for our property, plant and equipment. Our reviews utilize models that take into account actual usage, physical wear and tear, replacement history, assumptions about technology evolution and, in certain instances, actuarially determined probabilities to estimate the remaining useful life of our asset base. Our remaining useful life assessments anticipate the loss in service value of assets that may precede the physical retirement. Assets shared among many customers may lose service value as those customers leave the network. However, the asset is not retired until all customers no longer utilize the asset and we determine there is no alternative use for the asset. We have asset retirement obligations associated with the legally or contractually required removal of a limited group of property, plant and equipment assets from leased properties and the disposal of certain hazardous materials present in our owned properties. When an asset retirement obligation is identified, usually in association with the acquisition of the asset, we record the fair value of the obligation as a liability. The fair value of the obligation is also capitalized as property, plant and equipment and then amortized over the estimated remaining useful life of the associated asset. Where the removal obligation is not legally binding, the net cost to remove assets is expensed in the period in which the costs are actually incurred. We review long-lived tangible assets for impairment whenever facts and circumstances indicate that the carrying amounts of the assets may not be recoverable. For assessment purposes, long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities, absent a material change in operations. An impairment loss is recognized only if the carrying amount of the asset group is not recoverable and exceeds its fair value. Recoverability of the asset group to be held and used is assessed by comparing the carrying amount of the asset group to the estimated undiscounted future net cash flows expected to be generated by the asset group. If the asset group's carrying value is not recoverable, an impairment charge is recognized for the amount by which the carrying amount of the asset group exceeds its fair value. We determine fair values by using a combination of comparable market values and discounted cash flows, as appropriate. Goodwill, Customer Relationships and Other Intangible Assets Intangible assets arising from business combinations, such as goodwill, customer relationships, capitalized software, trademarks and trade names, are initially recorded at estimated fair value. We amortize customer relationships primarily over an estimated life of 7 to 15 years , using either the sum-of-the-years-digits or the straight-line methods, depending on the type of customer. We amortize capitalized software using the straight-line method over estimated lives ranging up to 7 years , except for approximately $237 million of our capitalized software costs, which represents costs to develop an integrated billing and customer care system which is amortized using the straight-line method over a 20 year period. We amortize our other intangible assets predominantly using the sum-of-the-years-digits method over an estimated life of 4 to 20 years. Other intangible assets not arising from business combinations are initially recorded at cost. Where there are no legal, regulatory, contractual or other factors that would reasonably limit the useful life of an intangible asset, we classify the intangible asset as indefinite-lived and such intangible assets are not amortized. Internally used software, whether purchased or developed by us, is capitalized and amortized using the straight-line method over its estimated useful life. We have capitalized certain costs associated with software such as costs of employees devoting time to the projects and external direct costs for materials and services. Costs associated with software to be used for internal purposes are expensed until the point at which the project has reached the development stage. Subsequent additions, modifications or upgrades to internal-use software are capitalized only to the extent that they allow the software to perform a task it previously did not perform. Software maintenance, data conversion and training costs are expensed in the period in which they are incurred. We review the remaining economic lives of our capitalized software annually. Capitalized software is included in other intangible assets, net, in our consolidated balance sheets. Our long-lived intangible assets, other than goodwill, with indefinite lives are assessed for impairment annually, or, under certain circumstances, more frequently, such as when events or changes in circumstances indicate there may be an impairment. These assets are carried at the estimated fair value at the time of acquisition and assets not acquired in acquisitions are recorded at historical cost. However, if their estimated fair value is less than the carrying amount, other indefinite-lived intangible assets are reduced to their estimated fair value through an impairment charge to our consolidated statements of operations. We are required to assess goodwill for impairment at least annually, or more frequently, if an event occurs or circumstances change that would indicate an impairment may have occurred. We are required to write-down the value of goodwill in periods in which the recorded amount of goodwill exceeds the implied fair value of goodwill. Our reporting units are not discrete legal entities with discrete financial statements. Therefore, the equity carrying value and future cash flows must be estimated each time a goodwill impairment assessment is performed on a reporting unit. As a result, our assets, liabilities and cash flows are assigned to reporting units using reasonable and consistent allocation methodologies. Certain estimates, judgments and assumptions are required to perform these assignments. We believe these estimates, judgments and assumptions to be reasonable, but changes in any of these can significantly affect each reporting unit's equity carrying value and future cash flows utilized for our goodwill impairment assessment. We are required to reassign goodwill to reporting units each time we reorganize our internal reporting structure which causes a change in the composition of our reporting units. Goodwill is reassigned to the reporting units using a relative fair value approach. We utilize the earnings before interest, taxes, depreciation and amortization of each reporting unit as our allocation methodology as it represents a reasonable proxy for the fair value of the operations being reorganized. See Note 4—Goodwill, Customer Relationships and Other Intangible Assets for additional information. Pension and Post-Retirement Benefits We recognize the funded status of our defined benefit and post-retirement plans as an asset or a liability on our consolidated balance sheet. Each year's actuarial gains or losses are a component of our other comprehensive income (loss), which is then included in our accumulated other comprehensive loss. Pension and post-retirement benefit expenses are recognized over the period in which the employee renders service and becomes eligible to receive benefits. We make significant assumptions (including the discount rate, expected rate of return on plan assets, mortality and health care trend rates) in computing the pension and post-retirement benefits expense and obligations. See Note 9—Employee Benefits for additional information. Foreign Currency Our results of operations include foreign subsidiaries, which are translated from the applicable functional currency to the United States Dollar using the average exchange rates during the reporting period, while assets and liabilities are translated at the reporting date. We include gains or losses from foreign currency re-measurement in other income, net in our consolidated statements of operations. Certain non-U.S. subsidiaries designate the local currency as their functional currency, and we record the translation of their assets and liabilities into U.S. dollars at the balance sheet date as translation adjustments and include them as a component of accumulated other comprehensive loss in our consolidated balance sheets. We consider the majority of our investments in our foreign subsidiaries to be long-term in nature. Common Stock At December 31, 2017 , we had 4 million unissued shares of CenturyLink, Inc. common stock reserved for acquisitions. In addition, we had 45 million shares authorized for future issuance under our equity incentive plans. Preferred stock Holders of outstanding CenturyLink, Inc. preferred stock are entitled to receive cumulative dividends, receive preferential distributions equal to $25 per share plus unpaid dividends upon CenturyLink, Inc.'s liquidation and vote as a single class with the holders of common stock. Dividends We pay dividends out of retained earnings to the extent we have retained earnings on the date the dividend is declared. If the dividend is in excess of our retained earnings on the declaration date, then the excess is drawn from our additional paid-in capital. Recently Adopted Accounting Pronouncements In 2017, we adopted Accounting Standards Update ("ASU") 2016-18, "Restricted Cash (a consensus of the Financial Accounting Standards Board ("FASB") Emerging Issues Task Force)" ("ASU 2016-18"). In the first quarter of 2017, we adopted ASU 2016-09, “Improvements to Employee Share Based Compensation” (“ASU 2016-09”) and ASU 2017-07, “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost” (“ASU 2017-07”). Each of these is described further below. Restricted Cash On November 17, 2016, the FASB issued ASU 2016-18, which requires that a statement of cash flows explain the change in the total of cash, cash equivalents and amounts generally described as restricted cash and restricted cash equivalents as compared to the previous presentation, which explains only the change in cash and cash equivalents. ASU 2016-18 is effective January 1, 2018, but early adoption is permitted and requires retrospective application of the requirements to all previous periods presented. We early adopted ASU 2016-18 in the second quarter of 2017. Share-based Compensation ASU 2016-09 modified the accounting and associated income tax accounting for share-based compensation in order to reduce the cost and complexity associated with previous U.S. generally accepted accounting principles (“GAAP”). The primary provisions of ASU 2016-09 that affect our consolidated financial statements for the year ended December 31, 2017 are: 1. A reclassification of the income tax effect associated with the difference between the expense recognized for share-based payments and the related tax deduction from additional paid-in capital to income tax expense. This change was applied on a prospective basis and resulted in a $5 million increase in income tax expense for the year ended December 31, 2017. 2. We elected to change our accounting policy to account for forfeitures of share-based payment grants as they occur as opposed to our previous policy of estimating the forfeitures on the grant date. The cumulative effect of adopting this policy as of January 1, 2017 resulted in an increase of $3 million , net of a $2 million tax effect, in accumulated deficit. Net Periodic Pension and Postretirement Benefit Costs ASU 2017-07 modified the presentation of net periodic pension and postretirement benefit costs and requires the service cost component to be reported separately from the other components in order to provide more useful information. Under ASU 2017-07, the service cost component of net periodic pension and postretirement benefit costs is required to be presented in the same expense category as the related salary and wages for the employee. The other components of the net periodic pension and postretirement benefit costs are required to be recognized below operating income in other income (expense), net in our consolidated statements of operations. This change was applied on a retrospective basis to all previous periods to match the current period presentation. This retrospective application resulted in a $2 million increase in operating income and a corresponding increase in total other expense, net for the year ended December 31, 2016 and a $26 million reduction in operating income and a corresponding decrease in total other expense, net for the year ended December 31, 2015 . Recent Accounting Pronouncements Comprehensive Income On February 14, 2018, the FASB issued ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” (“ASU 2018-02”). Under current accounting guidance, the income tax effects for changes in income tax rates and certain other transactions are recognized in income from continuing operations resulting in income tax effects recognized in accumulated other comprehensive income that don’t reflect the current tax rate of the entity (“stranded tax effects”). ASU 2018-02 allows us the option to reclassify these stranded tax effects related to the change in the federal income tax rate as a result of the Tax Cuts and Jobs Act to retained earnings. We currently plan to adopt the provisions of ASU 2018-02 in the first quarter of 2018 and elect to reclassify the stranded tax effects related to the Tax Cuts and Job Act from accumulated comprehensive income to retained earnings in first quarter of 2018. We currently estimate that our retained earnings and accumulated other comprehensive loss will increase by approximately $400 million as a result of the adoption of ASU 2018-02. Goodwill Impairment On January 26, 2017, the FASB issued ASU 2017-04, “Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”). ASU 2017-04 simplifies the impairment testing for goodwill by changing the measurement for goodwill impairment. Under current rules, we are required to compute the implied fair value of goodwill to measure the impairment amount if the carrying value of a reporting unit exceeds its fair value. Under ASU 2017-04, the goodwill impairment charge will equal the excess of the reporting unit carrying value above fair value, limited to the amount of goodwill assigned to the reporting unit. We are required to adopt the provisions of ASU 2017-04 for any goodwill impairment tests, including our required annual test, occurring after January 1, 2020, but have the option to early adopt for any impairment test that we are required to perform. We have not determined if we will elect to early adopt the provisions of ASU 2017-04. The provisions of ASU 2017-04 would not have affected our last goodwill impairment assessment, but no assurance can be provided that the simplified testing methodology will not affect our goodwill impairment assessment in the future. Income Taxes On October 24, 2016, the Financial Accounting |
Acquisition of Level 3
Acquisition of Level 3 | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Business Combination Disclosure | Acquisition of Level 3 On November 1, 2017, CenturyLink acquired Level 3 through successive merger transactions, including a merger of Level 3 with and into a merger subsidiary, which survived such merger as our indirect wholly-owned subsidiary under the name of Level 3 Parent, LLC. We entered into this acquisition to, among other things, realize certain strategic benefits, including enhanced financial and operational scale, market diversification and an enhanced combined network. As a result of the acquisition, Level 3 shareholders received $26.50 per share in cash and 1.4286 shares of CenturyLink common stock , with cash paid in lieu of fractional shares, for each outstanding share of Level 3 common stock they owned at closing, subject to certain limited exceptions. We issued this consideration with respect to all of the outstanding common stock of Level 3, with the exception of shares held by the dissenting common shareholders. Upon closing, CenturyLink shareholders owned approximately 51% and former Level 3 shareholders owned approximately 49% of the combined company. In addition, each outstanding Level 3 restricted stock unit award granted prior to April 1, 2014 or granted to an outside director of Level 3 was converted into $26.50 in cash and 1.4286 shares of CenturyLink common stock (and cash in lieu of fractional shares) with respect to each Level 3 share covered by such award (the "Converted RSU Awards"). Each outstanding Level 3 restricted stock unit award granted on or after April 1, 2014 (other than those granted to outside directors of Level 3) was converted into a CenturyLink restricted stock unit award using a conversion ratio of 2.8386 to 1 as determined in accordance with a formula set forth in the merger agreement (“the Continuing RSU Awards”) . The preliminary estimated amount of aggregate consideration of $19.617 billion is based on: • the 517.3 million shares of CenturyLink’s common stock (including those issued in connection with the Converted RSU Awards) issued to consummate the acquisition and the closing stock price of CenturyLink common stock at October 31, 2017 of $18.99 ; • the cash consideration of $26.50 per share on the 362.1 million common shares of Level 3 issued and outstanding as of October 31, 2017, and the cash consideration of $1 million paid on the Converted RSUs awards; • the estimated value of $136 million the Continuing RSU Awards, which represents the pre-combination portion of Level 3’s share-based compensation awards replaced by CenturyLink; and • the estimated liability of $60 million for the dissenting common shares issued and outstanding as of October 31, 2017; and At closing, CenturyLink assumed Level 3's long-term debt of approximately $10.6 billion . The aggregate cash payments required to be paid on or about the closing date were funded with the proceeds of $7.945 billion of term loans and $400 million of funds borrowed under our new revolving credit facility together with other available funds, which included $1.825 billion borrowed from Level 3 Parent, LLC. For additional information regarding CenturyLink’s financing of the Level 3 acquisition see Note 5—Long-Term Debt and Credit Facilities. We have recognized the assets and liabilities of Level 3 based on CenturyLink’s preliminary estimates of the fair value of the acquired tangible and intangible assets and assumed liabilities of Level 3 as of November 1, 2017, the consummation date of the acquisition, with the excess aggregate consideration recorded as goodwill. The final determination of the allocation of the aggregate consideration paid by CenturyLink in the combination will be based on the fair value of such assets and liabilities as of the acquisition date with any excess aggregate consideration to be recorded as goodwill. The estimation of such fair values and the estimation of lives of depreciable tangible assets and amortizable intangible assets will require significant judgment. As such, we have not completed our valuation analysis and calculations in sufficient detail necessary to arrive at the final estimates of the fair value of Level 3’s assets acquired and liabilities assumed, along with the related allocation to goodwill. The fair values of certain tangible assets, intangible assets, certain liabilities and residual goodwill are the most significant areas not yet finalized and therefore are subject to change. We expect to complete our final fair value determinations prior to the anniversary date of the acquisition. Our final fair value determinations may be significantly different than those reflected in our consolidated financial statements at December 31, 2017. Based solely on our preliminary estimates, the aggregate consideration exceeds the aggregate estimated fair value of the acquired assets and assumed liabilities by $10.837 billion , which we have recognized as goodwill. The goodwill is attributable to strategic benefits, including enhanced financial and operational scale, market diversification and leveraged combined networks that we expect to realize. None of the goodwill associated with this acquisition is deductible for income tax purposes. The following is our preliminary assignment of the preliminary estimated aggregate consideration: November 1, 2017 (Dollars in millions) Cash, accounts receivable and other current assets (1) $ 3,317 Property, plant and equipment 9,311 Identifiable intangible assets (2) Customer relationships 8,964 Other 391 Other noncurrent assets 782 Current liabilities, excluding current maturities of long-term debt (1,461 ) Current maturities of long-term debt (7 ) Long-term debt (10,888 ) Deferred credits and other liabilities (1,629 ) Goodwill 10,837 Total estimated aggregate consideration $ 19,617 ____________________________________________________________________________________________________________ (1) Includes a preliminary estimated fair value of $866 million for accounts receivable, which had a gross contractual value of $884 million on November 1, 2017. The $18 million difference between the gross contractual value and the preliminary estimated fair value assigned represents our best estimate as of November 1, 2017 of contractual cash flows that will not be collected. (2) The preliminary estimate of the weighted-average amortization period for the acquired intangible assets is approximately 12.0 years . On the acquisition date, we assumed Level 3’s contingencies. For more information on our contingencies, see Note 16—Commitments and Contingencies. Acquisition-Related Expenses We have incurred acquisition-related expenses related to our acquisition of Level 3. The table below summarizes our acquisition-related expenses, which consist of integration-related expenses, including severance and retention compensation expenses, and transaction-related expenses: Years Ended December 31, 2017 2016 (Dollars in millions) Transaction-related expenses $ 174 47 Integration-related expenses 97 5 Total acquisition-related expenses $ 271 52 At December 31, 2017 , we had incurred cumulative acquisition-related expenses of $323 million for Level 3. The total amounts of these expenses are included in our selling, general and administrative expenses. Level 3 incurred transaction-related expenses of $47 million on the date of acquisition. This amount is not included in our results of operations. References to Acquired Businesses In the discussion that follows, we refer to the incremental business activities that we now operate as a result of the Level 3 acquisition as “Legacy Level 3”. References to “Legacy CenturyLink”, when used to a comparison of our consolidated results for the years ended December 31, 2017 and 2016, mean the business we operated prior to the Level 3 acquisition. Combined Pro Forma Operating Results (Unaudited) For the year ended December 31, 2017, CenturyLink's results of operations included operating revenues (net of intercompany eliminations) attributable to Level 3 of $1.39 billion . The addition of Level 3's post-acquisition operations contributed a net loss of $144 million to our consolidated net income. The following unaudited pro forma financial information presents the combined results of CenturyLink as if the Level 3 acquisition had been consummated as of January 1, 2016. Years Ended December 31, 2017 2016 (Dollars in millions, except per share amounts) Operating revenues $ 24,321 25,378 Net income 1,632 883 Basic earnings per common share 1.54 0.84 Diluted earnings per common share 1.54 0.84 This pro forma information reflects certain adjustments to previously-reported operating results, consisting of primarily: • decreased operating revenues and expenses due to the elimination of deferred revenues associated with installation activities that were preliminarily assigned no value at the acquisition date (excluding certain deferred revenue associated with certain long-term prepaid customer capacity arrangements, which have been included at its current carrying value) and the elimination of transactions among CenturyLink and Level 3 that are now subject to intercompany elimination; • increased amortization expense related to identifiable intangible assets, net of decreased depreciation expense to reflect the preliminary fair value of property, plant and equipment; • increased interest expense resulting from (i) interest on the new debt to finance the combination and amortization of the related debt discount and debt issuance costs, (ii) the elimination of Level 3’s historical amortization of debt discount and debt issuance costs and (iii) a reduction in interest expense due to the accretion of an adjustment to reflect the increased preliminary fair value of the long-term debt of Level 3 recognized on the acquisition date; and • the related income tax effects. The pro forma information is presented for illustrative purposes only and does not necessarily reflect the actual results of operations had the Level 3 acquisition been consummated at January 1, 2016, nor is it necessarily indicative of future operating results. The pro forma information excludes transaction costs incurred by us and Level 3 during 2017 (which are further described above in this note) and does not reflect integration costs to be incurred by us in future periods. In addition, the pro forma information does not give effect to any potential revenue enhancements, cost synergies or other operating efficiencies that could result from the acquisitions (other than those realized in our historical consolidated financial statements after November 1, 2017). |
Sale of Data Centers and Coloca
Sale of Data Centers and Colocation Business | 12 Months Ended |
Dec. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations, Disclosure | Sale of Data Centers and Colocation Business On May 1, 2017, we sold our data centers and colocation business to a consortium led by BC Partners, Inc. and Medina Capital in exchange for cash and a minority stake in the limited partnership that owns the consortium's newly-formed global secure infrastructure company, Cyxtera Technologies ("Cyxtera"). We received pre-tax cash proceeds of $1.8 billion , and we have valued our minority stake at $150 million , which was based upon the total amount of equity contributions to the limited partnership on the date made. Due to the sale and related restructuring actions we have taken regarding certain subsidiaries involved in the data centers and colocation business, we have estimated a cumulative current tax impact relating to the sale totaling $65 million , $18 million of which was accrued in 2016 and $47 million of which was accrued in 2017. In connection with our sale of the data centers and colocation business to Cyxtera, we agreed to lease back from Cyxtera a portion of the data center space to provide data hosting services to our customers. Because we have continuing involvement in the business through our minority stake in Cyxtera's parent, we do not meet the requirements for a sale-leaseback transaction as described in ASC 840-40, Leases - Sale-Leaseback Transactions . Under the failed-sale-leaseback accounting model, we are deemed under GAAP to still own certain real estate assets sold to Cyxtera, which we must continue to reflect on our consolidated balance sheet and depreciate over the assets' remaining useful life. We must also treat a certain amount of the pre-tax cash proceeds from the sale of the assets as though it were the result of a financing obligation on our consolidated balance sheet, and our consolidated results of operations must include imputed revenue associated with the portion of the real estate assets that we have not leased back and imputed interest expense on the financing obligation. A portion of the rent payments required under our leaseback arrangement with Cyxtera is recognized as a reduction of the financing obligation, resulting in lower recognized rent expense than the amounts actually paid each period. At the end of the lease term, the remaining imputed financing obligation and the remaining net book value of the real estate assets will be derecognized. Please see "Leases" (ASU 2016-02) in Note 1—Background for additional information on the impact the new lease standard will have on the accounting for the failed-sale-leaseback. The following table reflects the assets sold to and the liabilities assumed by Cyxtera on May 1, 2017, including the impact of failed-sale-leaseback: Dollars in millions Goodwill $ 1,142 Property, plant and equipment 1,051 Other intangible assets 249 Other assets 66 Less assets not removed as a result of the failed-sale-leaseback (526 ) Total net amount of assets derecognized $ 1,982 Capital lease obligations 294 Other liabilities 274 Less imputed financing obligations from the failed-sale-leaseback (628 ) Total net imputed liabilities recognized $ (60 ) In addition, the failed-sale-leaseback accounting treatment had the following effects on our consolidated results of operations for the year ended December 31, 2017: Positive (Negative) Impact to Net Income Dollars in millions Increase in revenue $ 49 Decrease in cost of sales 15 Increase in loss on sale of business included in selling, general and administrative expense (102 ) Increase in depreciation expense (one-time) (44 ) Increase in depreciation expense (ongoing) (47 ) Increase in interest expense (39 ) Decrease in income tax expense 65 Decrease in net income $ (103 ) After factoring in the costs to sell the data centers and colocation business, excluding the impact from the failed-sale-leaseback accounting treatment, the sale resulted in a $20 million gain as a result of the aggregate value of the proceeds we received exceeding the carrying value of the assets sold and liabilities assumed. Based on the fair market values of the failed-sale-leaseback assets, the failed-sale-leaseback accounting treatment resulted in a loss of $102 million as a result of the requirement to treat a certain amount of the pre-tax cash proceeds from the sale of the assets as though it were the result of a financing obligation. The combined net loss of $82 million was included in selling, general and administrative expenses in our consolidated statement of operations for the year ended December 31, 2017. The sale also resulted in a significant capital loss carryforward, which was entirely offset by a valuation allowance due to our determination that we are not likely to be able to utilize this carryforward prior to its expiration. We evaluated our minority stake in the limited partnership and determined that we were not the primary beneficiary of the entity. As a result, we classified our $150 million investment in the limited partnership in other assets on our consolidated balance sheet as of December 31, 2017. In addition to our investment, we have a receivable for $49 million from Cyxtera, classified primarily in other current assets on our consolidated balance sheet as of December 31, 2017. We will continue to have an ongoing obligation to Cyxtera related to our lease of data center space from them. From May 1, 2017 through December 31, 2017, we paid rent to Cyxtera totaling $80 million . Effective November 3, 2016, which is the date we entered into the agreement to sell our data centers and colocation business, we ceased recording depreciation of the property, plant and equipment to be sold and amortization of the business's intangible assets in accordance with applicable accounting rules. Otherwise, we estimate that we would have recorded additional depreciation and amortization expense of $67 million from January 1, 2017 through May 1, 2017. |
Goodwill, Customer Relationship
Goodwill, Customer Relationships and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill, Customer Relationships and Other Intangible Assets | Goodwill, Customer Relationships and Other Intangible Assets Goodwill, customer relationships and other intangible assets consisted of the following: As of December 31, 2017 2016 (Dollars in millions) Goodwill $ 30,475 19,650 Customer relationships, less accumulated amortization of $7,096 and $6,318 $ 10,876 2,797 Indefinite-life intangible assets $ 269 269 Other intangible assets subject to amortization: Capitalized software, less accumulated amortization of $2,294 and $2,019 1,469 1,227 Trade names and patents, less accumulated amortization of $31 and $23 159 35 Total other intangible assets, net $ 1,897 1,531 Our goodwill was derived from numerous acquisitions where the purchase price exceeded the fair value of the net assets acquired (including the acquisition described in Note 2—Acquisition of Level 3). At December 31, 2017 , the net carrying amounts of goodwill, customer relationships and other intangibles assets included preliminary estimates of $20.060 billion as a result of our Level 3 acquisition. As of December 31, 2017 , the preliminary estimate of the weighted average remaining useful lives of the intangible assets acquired in the acquisition of Level 3 was approximately 12 years in total, approximately 12 years for customer relationships, 5 years for capitalized software and 5 years for trade names. Total amortization expense for intangible assets for the years ended December 31, 2017 , 2016 and 2015 was $1.226 billion , $1.225 billion and $1.353 billion , respectively. As of December 31, 2017 , the gross carrying amount of goodwill, customer relationships, indefinite-life and other intangible assets was $52.669 billion . We estimate that total amortization expense for intangible assets (which include preliminary estimates for the intangible assets acquired from Level 3) for the years ending December 31, 2018 through 2022 will be as follows: (Dollars in millions) 2018 $ 1,802 2019 1,701 2020 1,590 2021 1,149 2022 977 We assess our goodwill and other indefinite-lived intangible assets for impairment annually, or, under certain circumstances, more frequently, such as when events or changes in circumstances indicate there may be impairment. We are required to write down the value of goodwill only when our assessment determines the recorded amount of goodwill exceeds the implied fair value. Our annual impairment assessment date for goodwill is October 31, at which date we assessed our reporting units, which were enterprise (excluding wholesale), consumer and wholesale. Our annual impairment assessment date for indefinite-lived intangible assets other than goodwill is December 31. Our reporting units are not discrete legal entities with discrete financial statements. Our assets and liabilities are employed in and relate to the operations of multiple reporting units. For each reporting unit, we compare its estimated fair value of equity to its carrying value of equity that we assign to the reporting unit. If the estimated fair value of the reporting unit is greater than the carrying value, we conclude that no impairment exists. If the estimated fair value of the reporting unit is less than the carrying value, a second calculation is required in which the implied fair value of goodwill is compared to the carrying value of goodwill that we assigned to the reporting unit. If the implied fair value of goodwill is less than its carrying value, goodwill must be written down to its implied fair value. At October 31, 2017, we utilized a level 3 valuation technique to estimate the fair value of our enterprise (excluding wholesale), consumer and wholesale reporting units by considering both a market approach and a discounted cash flow method. The market approach method includes the use of comparable multiples of publicly traded companies whose services are comparable to ours. The discounted cash flow method is based on the present value of projected cash flows and a terminal value, which represents the expected normalized cash flows of the reporting units beyond the cash flows from the discrete projection period. We reconciled the estimated fair values of the reporting units to our market capitalization as of October 31, 2017 and concluded that the indicated implied control premium of approximately 36% was reasonable based on recent transactions in the market place. As of October 31, 2017, based on our assessment performed with respect to these reporting units as described above, we concluded that our goodwill for our three reporting units was not impaired as of that date. The following table shows the rollforward of goodwill assigned to our reportable segments from December 31, 2015 through December 31, 2017 . Business Consumer Total (Dollars in millions) As of December 31, 2015 (1) $ 10,464 10,278 20,742 Purchase accounting and other adjustments 49 — 49 Goodwill attributable to the colocation business and data centers reclassified to assets held for sale (1,141 ) — (1,141 ) As of December 31, 2016 (1) 9,372 10,278 19,650 Purchase accounting and other adjustments 10,825 — 10,825 As of December 31, 2017 (1) $ 20,197 10,278 30,475 _____________________________________________________________________________ (1) Goodwill is net of accumulated impairment losses of $1.1 billion that related to our former hosting segment now included in our business segment. As of December 31, 2017, the $20.197 billion of goodwill assigned to our business reportable segment has not been allocated to our expected future reporting units ((i) medium and small business, (ii) enterprise, (iii) international and global accounts, (iv) wholesale and indirect and (v) consumer) as we have not completed our valuation analysis and calculation in sufficient detail necessary to allocate the goodwill to these reporting units. During 2016, we acquired all of the outstanding stock of three companies for total consideration of $53 million , including future deferred or contingent cash payments of $14 million , of which $49 million has been attributed to goodwill. We have completed our valuations of the fair values of assets acquired and liabilities assumed, along with the related allocations to goodwill and intangible assets for these three acquisitions. These acquisitions were consummated to expand the product offerings of our business segment and therefore the goodwill has been assigned to that segment. The majority of the goodwill is attributed primarily to expected future increases in business segment revenue from the sale of new products. The majority of the goodwill from these acquisitions is expected to be deductible for tax purposes. None of the above-described acquisitions materially impacted the consolidated results of operations from the dates of the acquisitions and would not materially impact pro forma results of operations. For additional information on our segments, see Note 14—Segment Information. We completed our qualitative assessment of our indefinite-lived intangible assets other than goodwill as of December 31, 2017 and concluded it is more likely than not that our indefinite-lived intangible assets are not impaired; thus, no impairment charge was recorded in 2017. As of October 31, 2016 and 2015, based on our assessments performed, we concluded that our goodwill for our then three reporting units was not impaired as of those dates. |
Long-Term Debt and Credit Facil
Long-Term Debt and Credit Facilities | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-Term Debt and Credit Facilities | Long-Term Debt and Credit Facilities The following chart reflects the consolidated long-term debt of CenturyLink, Inc. and its subsidiaries, including unamortized discounts and premiums and unamortized debt issuance costs, but excluding intercompany debt: As of December 31, Interest Rates (1) Maturities 2017 2016 (Dollars in millions) Senior Secured Debt: CenturyLink, Inc. 2017 Revolving Credit Facility (2) 4.153% - 4.285% 2022 $ 405 — Term Loan A 4.319% 2022 1,575 — Term Loan A-1 4.319% 2022 370 — Term Loan B 4.319% 2025 6,000 — Subsidiaries: Level 3 Financing, Inc. Tranche B 2024 Term Loan 3.696% 2024 4,611 — Embarq Corporation subsidiaries First mortgage bonds 7.125% - 8.770% 2018 - 2025 151 223 Senior Notes and Other Debt: CenturyLink, Inc. Senior notes 5.625% - 7.650% 2019 - 2042 8,125 8,975 2012 Credit facility and revolving line of credit (2) — — — 370 2012 Term loan — — — 336 Subsidiaries: Level 3 Financing, Inc. Senior notes 5.125% - 6.125% 2021 - 2026 5,315 — Level 3 Parent, LLC Senior notes 5.750% 2022 600 — Qwest Corporation Senior notes 6.125% - 7.750% 2018 - 2057 7,294 7,259 Term loan 3.570% 2025 100 100 Qwest Capital Funding, Inc. Senior notes 6.500% - 7.750% 2018 - 2031 981 981 Embarq Corporation and subsidiary Senior note 7.995% 2036 1,485 1,485 Other 9.000% 2019 150 150 Capital lease and other obligations (3) Various Various 891 440 Unamortized discounts and other, net 23 (133 ) Unamortized debt issuance costs (350 ) (193 ) Total long-term debt 37,726 19,993 Less current maturities not associated with assets held for sale (443 ) (1,503 ) Less capital lease obligations associated with assets held for sale — (305 ) Long-term debt, excluding current maturities and capital leases obligations associated with assets held for sale $ 37,283 18,185 _______________________________________________________________________________ (1) As of December 31, 2017. (2) The aggregate amount outstanding on our 2017 revolving credit facility at December 31, 2017 was $405 million with a weighted-average interest rate of 4.186% . These amounts change on a regular basis. The aggregate amount outstanding on our 2012 credit facility and revolving line of credit borrowings at December 31, 2016 was $370 million with weighted-average interest rate of 4.500% . As described under "2017 CenturyLink Credit Agreement" below, we discharged and terminated our 2012 credit facility on November 1, 2017. (3) As a result of not meeting the sale leaseback accounting requirements, we must treat a certain amount of the pre-tax cash proceeds from the sale of our real estate assets as though it were the result of a financing obligation on our consolidated balance sheet. Also, the capital lease obligations that were shown as held for sale as of December 31, 2016 are retained and revalued. Please see Note 3—Sale of Data Centers and Colocation Business for additional information on our most current estimate of the financing obligation. Debt of CenturyLink, Inc. and its Subsidiaries At December 31, 2017, most of our outstanding consolidated debt had been incurred by CenturyLink, Inc. or one of the following four other primary borrowers or “borrowing groups,” each of which has borrowed funds either on a standalone basis or as part of a separate restricted group with certain of its subsidiaries: • Qwest Corporation; • Qwest Capital Funding, Inc. (including its parent guarantor, Qwest Communications International Inc.); • Embarq Corporation; and • Level 3 Parent, LLC (including its finance subsidiary, Level 3 Financing, Inc.). Each of these borrowers or borrowing groups has entered into one or more credit agreements with certain financial institutions or other institutional lenders, or issued senior notes. Certain of these debt instruments are described further below. Level 3 Long-Term Debt Acquired As a result of the acquisition of Level 3 on November 1, 2017, Level 3's pre-existing debt obligations, which consisted of senior notes and a term loan issued by Level 3 Parent, LLC and Level 3 Financing, Inc., are now included in our consolidated debt balances. Level 3 Financing, Inc.’s Tranche B 2024 Term Loan is further described below under “Term Loans and Certain Other Debt of Subsidiaries”. On the acquisition date, Level 3’s debt securities had (i) stated principal balances totaling $10.526 billion , (ii) fixed contractual interest rates on senior notes ranging from 5.125% to 6.125% (with a weighted average of 5.47% ) and a floating interest rate on the term loan and (iii) maturities ranging from 2021 to 2026. In accounting for the Level 3 acquisition, we recorded Level 3's debt securities at their estimated fair values, which totaled $10.716 billion as of November 1, 2017. In addition, we assumed Level 3's capital lease obligations of $179 million . Our acquisition date fair value estimates were based primarily on quoted market prices where available or, if not available, based on discounted future cash flows using current market interest rates. The amount by which the fair value of Level 3 debt securities exceeded their stated principal balances on the acquisition date of $190 million is being recognized as a reduction to interest expense over the remaining terms of the debt. 2017 CenturyLink Credit Agreement As further described in Note 2—Acquisition of Level 3, CenturyLink, Inc. completed its acquisition of Level 3 on November 1, 2017. To finance a substantial portion of its acquisition of Level 3, on June 19, 2017, CenturyLink, Inc. caused its wholly-owned subsidiary, CenturyLink Escrow, LLC (the "Escrow Borrower"), to enter into a credit agreement (the "2017 CenturyLink Credit Agreement") with, among others, Bank of America, N.A., as administrative agent and collateral agent, initially providing for $9.945 billion in senior secured credit facilities (the "2017 Senior Secured Credit Facilities"). These facilities consist of the following: • a $2 billion revolving credit facility (“2017 Revolving Credit Facility”), which originally had 18 lenders, each with allocations ranging from $36.4 million to $167.8 million , which we initially drew upon on November 1, 2017; • a $1.575 billion senior secured Term Loan A credit facility, which originally had 17 lenders, each with commitments ranging from $28.6 million to $132.2 million , which we drew in full on November 1, 2017; • a $370 million senior secured Term Loan A-1 credit facility with CoBank, ACB, which we drew in full on November 1, 2017; and • a $6 billion senior secured Term Loan “B” credit facility, which we fully pre-funded the proceeds, net of a discount, into escrow on June 19, 2017 and released to us on November 1, 2017. Loans under the Term Loan A and A-1 facilities and the 2017 Revolving Credit Facility bear interest at a rate equal to, at our option, the London Interbank Offered Rate (“LIBOR”) or the alternative base rate (each as defined in the 2017 CenturyLink Credit Agreement) plus an applicable margin between 2.25% to 3.00% per annum for LIBOR loans and 1.25% to 2.00% per annum for alternative base rate loans, depending on our then current total leverage ratio. Borrowings under the Term Loan B facility bore interest at 1.375% per annum through July 18, 2017 and at 2.75% per annum thereafter through November 1, 2017. Subsequent to November 1, 2017, borrowings under the Term Loan B facility bear interest at LIBOR plus 2.75% per annum. Loans under each of the term loan facilities require certain specified quarterly amortization payments and certain specified mandatory prepayments in connection with certain asset sales and debt issuances and out of excess cash flow, among other things, subject in each case to certain significant exceptions. CenturyLink, Inc. used the proceeds of the borrowings under the 2017 Senior Secured Credit Facilities, together with other available funds (including $1.825 billion borrowed from Level 3), (i) to fund the cash portion of the consideration and transaction costs payable in connection with the Level 3 acquisition and (ii) to repay all indebtedness outstanding under its 2012 term loan. The 2017 Revolving Credit Facility and borrowings under the Term Loan A and A-1 facilities will mature on November 1, 2022. Borrowings under the Term Loan B facility will mature on January 31, 2025. By virtue of merging the Escrow Borrower into CenturyLink, Inc. on November 1, 2017, CenturyLink, Inc. assumed all rights and obligations under the 2017 CenturyLink Credit Agreement, including the right to borrow funds under the 2017 Revolving Credit Facility on the terms and conditions specified in the 2017 CenturyLink Credit Agreement. All of CenturyLink, Inc.'s obligations under the 2017 Senior Secured Credit Facilities are guaranteed by certain of its subsidiaries. The guarantees by certain of those guarantors are secured by a first priority security interest in substantially all assets (including certain subsidiaries stock) directly owned by them, subject to certain exceptions and limitations. The 2017 Revolving Credit Facility replaced CenturyLink, Inc.'s 2012 revolving credit facility. A portion of the 2017 Revolving Credit Facility in an amount not to exceed $100 million is available for swingline loans, and a portion in an amount not to exceed $400 million is available for the issuance of letters of credit. In addition, on November 1, 2017, CenturyLink, Inc. discharged its 2012 term loan scheduled to mature in 2019 and entered into Term Loan A-1 with the same lender. CenturyLink, Inc. is permitted under the 2017 CenturyLink Credit Agreement to request certain incremental borrowings subject to the satisfaction of various conditions and to certain other limitations. Any incremental borrowings would be subject to the same terms and conditions under the 2017 CenturyLink Credit Agreement. Term Loans and Certain Other Debt of Subsidiaries Qwest Corporation In 2015, Qwest Corporation entered into a term loan in the amount of $100 million with CoBank, ACB. The outstanding unpaid principal amount of this term loan plus any accrued and unpaid interest is due on February 20, 2025. Interest is paid monthly based upon either the London Interbank Offered Rate (“LIBOR”) or the base rate (as defined in the credit agreement) plus an applicable margin between 1.50% to 2.50% per annum for LIBOR loans and 0.50% to 1.50% per annum for base rate loans depending on Qwest Corporation's then current senior unsecured long-term debt rating. At both December 31, 2017 and 2016, the outstanding principal balance on this term loan was $100 million . Level 3 Financing, Inc . At November 1, 2017 and December 31, 2017, Level 3 Financing, Inc. owed $4.611 billion under the Tranche B 2024 Term Loan, which matures on February 22, 2024. The Tranche B 2024 Term Loan carries an interest rate, in the case of base rate borrowings, equal to (i) the greater of the Prime Rate, the Federal Funds Effective Rate plus 50 basis points, or LIBOR plus 100 basis points (with all such terms and calculations as defined or further specified in the applicable credit agreement) plus (ii) 1.25% per annum. Any Eurodollar borrowings under the Tranche B 2024 Term Loan bear interest at LIBOR plus 2.25% per annum. The Tranche B 2024 Term Loan requires certain specified mandatory prepayments in connection with certain asset sales and other transactions, subject to certain significant exceptions. The obligations of Level 3 Financing, Inc. under the Tranche B 2024 Term Loan are, subject to certain exceptions, secured by certain assets of Level 3 Parent, LLC and, subject to pending regulatory approvals, certain of its material domestic telecommunication subsidiaries. Also, Level 3 Parent, LLC has guaranteed and, upon receipt of pending regulatory approvals, certain of its subsidiaries will guarantee the obligations of Level 3 Financing, Inc. under the Tranche B 2024 Term Loan. Subject to the receipt of pending regulatory approvals, Level 3 Communications, LLC and its material domestic subsidiaries will guarantee and, subject to certain exceptions, will pledge certain of their assets to secure the obligations of Level 3 Financing, Inc. under the Tranche B 2024 Term Loan. Embarq Subsidiaries At December 31, 2017, two of our Embarq subsidiaries had outstanding first mortgage bonds. Each issue of these first mortgage bonds is secured by substantially all of the property, plant and equipment of the issuing subsidiary. Revolving Letters of Credit CenturyLink, Inc. maintains an uncommitted revolving letter of credit facility separate from the letter of credit facility included in the 2017 Revolving Credit Facility noted above. On November 1, 2017, this facility was amended to increase its size from $160 million to $225 million and to provide the lender with credit enhancements in the form of secured guarantees issued by certain CenturyLink subsidiaries. As of December 31, 2017 and 2016, CenturyLink, Inc.’s outstanding letters of credit under this credit facility totaled $104 million and $105 million , respectively. As of December 31, 2017, Level 3 Parent, LLC had outstanding letters of credit or other similar obligations of approximately $36 million of which $30 million is collateralized by cash that is reflected on the consolidated balance sheets in restricted cash and securities. Senior Notes CenturyLink, Inc., Level 3 Financing, Inc., Level 3 Parent, LLC, Qwest Corporation, Qwest Capital Funding, Inc. and Embarq Corporation have each issued unsecured senior notes. All of these notes carry fixed interest rates and all principal is due on the notes’ respective maturity dates, which rates and maturity dates are summarized in the table above. The senior notes issued by Level 3 Financing, Inc. are guaranteed by its parent, Level 3 Parent, LLC and another of its affiliates. The senior notes issued by Qwest Capital Funding, Inc. are guaranteed by its parent, Qwest Communications International Inc. Except for a limited number of senior notes issued by Qwest Corporation, the issuer generally can redeem the notes, at its option, in whole or in part, (i) pursuant to a fixed schedule of pre-established redemption prices, (ii) pursuant to a “make whole” redemption price or (iii) under certain other specified limited conditions. Under certain circumstances in connection with a “change of control” of CenturyLink, Inc., it will be required to make an offer to repurchase each series of these senior notes (other than two of its older series of notes) at a price of 101% of the principal amount redeemed, plus accrued and unpaid interest . Also, under certain circumstances in connection with a "change of control" of Level 3 Parent, LLC, it, as well as Level 3 Financing, Inc., will be required to make an offer to repurchase each series of its outstanding senior notes at a price of 101% of the principal amount redeemed, plus accrued and unpaid interest . New Issuances 2017 As described above under “2017 CenturyLink Credit Agreement”, on June 19, 2017, CenturyLink, Inc. caused one of its wholly-owned subsidiaries to enter into the 2017 CenturyLink Credit Agreement initially providing for $9.945 billion of senior secured credit facilities. Upon the execution of the 2017 CenturyLink Credit Agreement, the $6 billion Term Loan B credit facility was fully funded. On November 1, 2017, CenturyLink, Inc. assumed the obligations and borrowed additional sums under such credit agreement. On April 27, 2017 , Qwest Corporation issued $575 million aggregate principal amount of 6.75% Notes due 2057 and, on May 5, 2017, issued an additional $85 million aggregate principal amount of such notes pursuant to an over-allotment option in exchange for aggregate net proceeds, after deducting underwriting discounts and other expenses, of $638 million . All of the 6.75% Notes are senior unsecured obligations and may be redeemed by Qwest Corporation, in whole or in part, on or after June 15, 2022, at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest to the redemption date. 2016 On August 22, 2016, Qwest Corporation issued $978 million aggregate principal amount of 6.5% Notes due 2056, including $128 million principal amount that was sold pursuant to an over-allotment option, in exchange for net proceeds, after deducting underwriting discounts and other expenses, of $946 million . All of the 6.5% Notes are unsecured obligations and may be redeemed by Qwest Corporation, in whole or in part, on or after September 1, 2021, at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest to the redemption date. On April 6, 2016, CenturyLink, Inc. issued $1 billion aggregate principal amount of 7.5% Notes due 2024, in exchange for net proceeds, after deducting underwriting discounts and other expenses, of $988 million . All of the 7.5% Notes are unsecured obligations and may be redeemed by CenturyLink, Inc., in whole or in part, on or after January 1, 2024, at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest to the redemption date. At any time before January 1, 2024, the Notes are redeemable, in whole or in part, at CenturyLink, Inc.'s option, at a redemption price equal to the greater of 100% of the principal amount of the Notes to be redeemed or the sum of the present values of the remaining scheduled payments of principal and interest on the Notes to be redeemed, discounted to the redemption date in the manner described in the Notes , plus accrued and unpaid interest to the redemption date. In addition, at any time on or prior to April 1, 2019, CenturyLink, Inc. may redeem up to 35% of the aggregate principal amount of the Notes at a redemption price of 107.5% of the principal amount thereof, plus accrued and unpaid interest to the redemption date, with the net proceeds of certain equity offerings. Under certain circumstances, CenturyLink, Inc. will be required to make an offer to repurchase the Notes at a price of 101% of the aggregate principal amount plus accrued and unpaid interest to the repurchase date. On January 29, 2016, Qwest Corporation issued $235 million aggregate principal amount of 7% Notes due 2056, in exchange for net proceeds, after deducting underwriting discounts and other expenses, of $227 million . All of the 7% Notes are unsecured obligations and may be redeemed by Qwest Corporation, in whole or in part, on or after February 1, 2021, at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest to the redemption date. Repayments 2017 As described above under “2017 CenturyLink Credit Agreement”, on November 1, 2017, CenturyLink, Inc. repaid the outstanding principal amount of $319 million under its 2012 term loan. On August 1, 2017, subsidiaries of Embarq Corporation paid at maturity the $72 million principal amount and accrued and unpaid interest due under their 8.77% Notes. On June 15, 2017, CenturyLink, Inc. paid at maturity the $350 million principal and accrued and unpaid interest due under its 5.15% Notes. On May 9, 2017, Qwest Corporation redeemed $125 million aggregate principal amount of the remaining $288 million of its 7.5% Notes due 2051, which resulted in an immaterial loss . On May 4, 2017 , Qwest Corporation redeemed all $500 million of its 6.5% Notes due 2017, which resulted in an immaterial loss . On April 3, 2017 , CenturyLink, Inc. paid at maturity the $500 million principal and accrued and unpaid interest due under its 6.00% Notes. 2016 On December 23, 2016, a subsidiary of Embarq Corporation redeemed $5 million of its 8.375% Notes due 2025, which resulted in an immaterial loss. On September 19, 2016, a subsidiary of Embarq Corporation redeemed all of its 8.77% Notes due 2017, which was less than $4 million and resulted in an immaterial loss. On September 15, 2016, Qwest Corporation redeemed $287 million of its 7.5% Notes due 2051, which resulted in a loss of $9 million . On August 29, 2016, Qwest Corporation redeemed all $661 million of its 7.375% Notes due 2051, which resulted in a loss of $18 million . On June 1, 2016, Embarq Corporation paid at maturity the $1.184 billion principal amount and accrued and unpaid interest due under its 7.082% Notes. On May 2, 2016, Qwest Corporation paid at maturity the $235 million principal amount and accrued and unpaid interest due under its 8.375% Notes. Aggregate Maturities of Long-Term Debt Set forth below is the aggregate principal amount of our long-term debt (excluding unamortized discounts, net and unamortized debt issuance costs) maturing during the following years: (Dollars in millions) (1)(2) 2018 $ 443 2019 638 2020 1,194 2021 3,109 2022 5,033 2023 and thereafter 27,137 Total long-term debt $ 37,554 _______________________________________________________________________________ (1) The amount outstanding on the data centers obligation at December 31, 2017 was $598 million . The aggregate maturities of long-term debt do not include $499 million of this obligation, which, at the end of the lease term on April 30, 2020, will be derecognized along with the remaining net book value of the associated real estate assets. Also, the aggregate maturities of long-term debt do not include future imputed lease income of $173 million attributable to the accounting for certain of the real estate assets under the failed-sale-leaseback. See Note 3—Sale of Data Centers and Colocation Business for additional information. (2) Actual principal paid in any year may differ due to the possible future refinancing of outstanding debt or the issuance of new debt. The projected amounts in the table also exclude any impacts from any further acquisitions. Interest Expense Interest expense includes interest on total long-term debt. The following table presents the amount of gross interest expense, net of capitalized interest: Years Ended December 31, 2017 2016 2015 (Dollars in millions) Interest expense: Gross interest expense $ 1,559 1,372 1,364 Capitalized interest (78 ) (54 ) (52 ) Total interest expense $ 1,481 1,318 1,312 Covenants CenturyLink, Inc. With respect to the Term Loan A and A-1 facilities and the 2017 Revolving Credit Facility, the 2017 CenturyLink Credit Agreement requires us to maintain (i) a maximum total leverage ratio of not more than 5.00 to 1.00 between the closing date of the Level 3 acquisition and the second anniversary thereof and 4.75 to 1.00 thereafter and (ii) a minimum consolidated interest coverage ratio of at least 2.00 to 1.00, with such ratios being determined and calculated in the manner described in the 2017 CenturyLink Credit Agreement. The 2017 Senior Secured Credit Facilities contain various representations and warranties and extensive affirmative and negative covenants. Such covenants include, among other things and subject to certain significant exceptions, restrictions on our ability to declare or pay dividends, repurchase stock, repay certain other indebtedness, create liens, incur additional indebtedness, make investments, engage in transactions with its affiliates, dispose of assets and merge or consolidate with any other person. The senior notes of CenturyLink, Inc. were issued under an indenture dated March 31, 1994. This indenture restricts our ability to (i) incur, issue or create liens upon the property of CenturyLink, Inc. and (ii) consolidate with or merge into, or transfer or lease all or substantially all of our assets to any other party . The indenture does not contain any provisions that are impacted by our credit ratings or that restrict the issuance of new securities in the event of a material adverse change to us. However, as indicated above under "Senior Notes", CenturyLink, Inc. will be required to offer to purchase certain of its long-term debt securities issued under this indenture under certain circumstances in connection with a "change of control" of CenturyLink, Inc. Level 3 Companies The term loan and senior notes of Level 3 Parent, LLC and Level 3 Financing, Inc. contain extensive affirmative and negative covenants. Such covenants include, among other things and subject to certain significant exceptions, restrictions on their ability to declare or pay dividends, repay certain other indebtedness, create liens, incur additional indebtedness, make investments, engage in transactions with their affiliates, dispose of assets and merge or consolidate with any other person . Also, as indicated above under "Senior Notes", Level 3 Parent, LLC, as well as Level 3 Financing, Inc., will be required to offer to purchase certain of its long-term debt securities under certain circumstances in connection with a "change of control" of Level 3 Parent, LLC. Qwest Companies Under its term loan, Qwest Corporation must maintain a debt to EBITDA (earnings before interest, taxes, depreciation and amortization, as defined in such term loan) ratio of not more than 2.85:1.0, as of the last day of each fiscal quarter for the four quarters then ended. The term loan also contains a negative pledge covenant, which generally requires Qwest Corporation to secure equally and ratably any advances under the term loan if it pledges assets or permit liens on its property for the benefit of other debtholders . The senior notes of Qwest Corporation were issued under indentures dated April 15, 1990 and October 15, 1999. These indentures contain restrictions on the incurrence of liens and the consummation of certain transactions substantially similar to the above-described covenants in CenturyLink, Inc.'s March 31, 1994 indenture (but contain no mandatory repurchase provisions) . The senior notes of Qwest Capital Funding, Inc. were issued under an indenture dated June 29, 1998 containing terms substantially similar to those set forth in Qwest Corporation's indentures . Embarq Embarq's senior note was issued pursuant to an indenture dated as of May 17, 2006. While Embarq is generally prohibited from creating liens on its property unless its senior notes are secured equally and ratably, Embarq can create liens on its property without equally and ratably securing its senior notes so long as the sum of all indebtedness so secured does not exceed 15% of Embarq's consolidated net tangible assets. The indenture also contains restrictions on the consummation of certain transactions substantially similar to CenturyLink, Inc.’s above-described covenants (but without mandatory repurchase provision), as well as certain customary covenants to maintain properties and pay all taxes and lawful claims . Impact of Covenants The debt covenants applicable to CenturyLink, Inc. and its subsidiaries could materially adversely affect their ability to operate or expand their respective businesses, to pursue strategic transactions, or to otherwise pursue their plans and strategies. The covenants of the Level 3 companies may significantly restrict the ability of CenturyLink, Inc. to receive cash from the Level 3 companies, to distribute cash from the Level 3 companies to other of CenturyLink, Inc.’s affiliated entities, or to enter into other transactions among CenturyLink, Inc.’s wholly-owned entities. Certain of the debt instruments of CenturyLink, Inc. and its subsidiaries contain cross payment default or cross acceleration provisions. When present, these provisions could have a wider impact on liquidity than might otherwise arise from a default or acceleration of a single debt instrument. The ability of CenturyLink, Inc. and its subsidiaries to comply with the financial covenants in their respective debt instruments could be adversely impacted by a wide variety of events, including unforeseen contingencies, many of which are beyond their control. Compliance At December 31, 2017 , CenturyLink, Inc. believes it and its subsidiaries were in compliance with the provisions and covenants contained in their respective material debt agreements. Guarantees CenturyLink, Inc. does not guarantee the debt of any unaffiliated parties, but, as noted above, certain of its largest subsidiaries guarantee (i) its debt outstanding under the 2017 CenturyLink Credit Agreement and (ii) the outstanding term loans or senior notes issued by certain other subsidiaries. As further noted above, several of the subsidiaries guaranteeing the 2017 CenturyLink Credit Agreement have pledged substantially all of their assets to secure their respective guarantees. Subsequent Events On January 21, 2018, a subsidiary of Embarq Corporation redeemed all $13 million of its 8.77% Notes due 2019, which resulted in an immaterial loss. On January 29, 2018, the 2017 CenturyLink Credit Agreement was amended to: • Add a lender to the 2017 Revolving Credit Facility and to increase CenturyLink, Inc.’s borrowing capacity thereunder to approximately $2.168 billion ; and • Add a lender to the Term Loan A credit facility and to increase CenturyLink, Inc.’s borrowing capacity thereunder to approximately $1.707 billion . In connection with this amendment, the new lender provided approximately $132 million of Term Loan A loan proceeds, which CenturyLink used, together with available cash, to reduce its borrowings under the 2017 Revolving Credit Facility. |
Accounts Receivable
Accounts Receivable | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Accounts Receivable | Accounts Receivable The following table presents details of our accounts receivable balances: As of December 31, 2017 2016 (Dollars in millions) Trade and purchased receivables $ 2,245 1,882 Earned and unbilled receivables 436 299 Other 40 14 Total accounts receivable 2,721 2,195 Less: allowance for doubtful accounts (164 ) (178 ) Accounts receivable, less allowance $ 2,557 2,017 We are exposed to concentrations of credit risk from residential and business customers within our local service area, business customers outside of our local service area and from other telecommunications service providers. We generally do not require collateral to secure our receivable balances. We have agreements with other telecommunications service providers whereby we agree to bill and collect on their behalf for services rendered by those providers to our customers within our local service area. We purchase accounts receivable from other telecommunications service providers primarily on a recourse basis and include these amounts in our accounts receivable balance. We have not experienced any significant loss associated with these purchased receivables. The following table presents details of our allowance for doubtful accounts: Beginning Balance Additions Deductions Ending Balance (Dollars in millions) 2017 $ 178 176 (190 ) 164 2016 $ 152 192 (166 ) 178 2015 $ 162 177 (187 ) 152 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 2016 (Dollars in millions) Land N/A $ 883 563 Fiber, conduit and other outside plant (1) 15-45 years 22,798 16,996 Central office and other network electronics (2) 3-10 years 18,538 13,768 Support assets (3) 3-30 years 7,586 6,623 Construction in progress (4) N/A 1,399 1,244 Gross property, plant and equipment 51,204 39,194 Accumulated depreciation (24,352 ) (22,155 ) Net property, plant and equipment $ 26,852 17,039 _______________________________________________________________________________ (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, cable landing stations, data centers, computers and other administrative and support equipment. (4) Construction in progress includes inventory held for construction and property of the aforementioned categories that has not been placed in service as it is still under construction. We recorded depreciation expense of $2.710 billion , $2.691 billion and $2.836 billion for the years ended December 31, 2017 , 2016 and 2015 , respectively. Asset Retirement Obligations At December 31, 2017 , our asset retirement obligations balance was primarily related to estimated future costs of removing equipment from leased properties and estimated future costs of properly disposing of asbestos and other hazardous materials upon remodeling or demolishing buildings. Asset retirement obligations are included in other long-term liabilities on our consolidated balance sheets. As of the Level 3 acquisition date, we recorded liabilities to reflect our preliminary estimates of fair values of Level 3's asset retirement obligations. Our preliminary fair value estimates were determined using discounted cash flow method. The following table provides asset retirement obligation activity: Years Ended December 31, 2017 2016 2015 (Dollars in millions) Balance at beginning of year $ 95 91 107 Accretion expense 6 6 7 Liabilities assumed in acquisition of Level 3 45 — — Liabilities settled (3 ) (2 ) (2 ) Liabilities transferred to Cyxtera (20 ) — — Change in estimate (8 ) — (21 ) Balance at end of year $ 115 95 91 We revised our estimates for the cost of removal of network equipment, asbestos remediation, and other obligations by $8 million and $21 million , for the years ended December 31, 2017 and 2015 , respectively. These revisions resulted in a reduction of the asset retirement obligation and offsetting reduction to gross property, plant and equipment, and revisions to assets specifically identified are recorded as a reduction to accretion expense. We did not revise our estimates for the cost of removal of network equipment, asbestos remediation, and other obligations during 2016 . |
Severance and Leased Real Estat
Severance and Leased Real Estate | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Severance and Leased Real Estate | Severance and Leased Real Estate Periodically, we reduce our workforce and accrue liabilities for the related severance costs. These workforce reductions result primarily from the progression or completion of our post-acquisition integration plans, increased competitive pressures, cost reduction initiatives, process improvements through automation and reduced workload demands due to the loss of customers purchasing certain services. We report severance liabilities within accrued expenses and other liabilities - salaries and benefits in our consolidated balance sheets and report severance expenses in selling, general and administrative expenses in our consolidated statements of operations. As described in Note 14—Segment Information, we do not allocate these severance expenses to our segments. We have recognized liabilities to reflect our estimates of the fair values of the existing lease obligations for real estate which we have ceased using, net of estimated sublease rentals. As of the Level 3 acquisition date, we recorded liabilities to reflect our preliminary estimates of the fair values of the existing lease obligations for real estate for which we had ceased using, net of estimated sublease rentals. Our fair value estimates were determined using discounted cash flow methods. We recognize expense to reflect accretion of the discounted liabilities and periodically we adjust the expense when our actual subleasing experience differs from our initial estimates. We report the current portion of liabilities for ceased-use real estate leases in accrued expenses and other liabilities-other and report the noncurrent portion in deferred credits and other liabilities-other in our consolidated balance sheets. We report the related expenses in selling, general and administrative expenses in our consolidated statements of operations. At December 31, 2017 , the current and noncurrent portions of our leased real estate accrual were $11 million and $53 million , respectively. The remaining lease terms range from 0.16 years to 7.9 years, with a weighted average of 6.7 years. Changes in our accrued liabilities for severance expenses and leased real estate were as follows: Severance Real Estate (Dollars in millions) Balance at December 31, 2015 $ 14 80 Accrued to expense 173 4 Payments, net (89 ) (20 ) Reversals and adjustments — 3 Balance at December 31, 2016 98 67 Accrued to expense 42 4 Liabilities assumed in acquisition of Level 3 1 4 Payments, net (108 ) (13 ) Reversals and adjustments — 2 Balance at December 31, 2017 $ 33 64 |
Employee Benefits
Employee Benefits | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Employee Benefits | Employee Benefits Pension, Post-Retirement and Other Post-Employment Benefits We sponsor various defined benefit pension plans (qualified and non-qualified) which, in the aggregate, cover a substantial portion of our employees including legacy CenturyLink, legacy Qwest Communications International, Inc. ("Qwest") and legacy Embarq employees. On December 31, 2015 , we merged our existing qualified pension plans, which included merging the Qwest Pension Plan and Embarq Retirement Pension Plan into the CenturyLink Retirement Plan. The CenturyLink Retirement Plan was renamed the CenturyLink Combined Pension Plan ("Combined Plan"). Pension benefits for participants of the new Combined Plan who are represented by a collective bargaining agreement are based on negotiated schedules. All other participants' pension benefits are based on each individual participant's years of service and compensation. We also maintain non-qualified pension plans for certain current and former highly compensated employees. We maintain post-retirement benefit plans that provide health care and life insurance benefits for certain eligible retirees. We also provide other post-employment benefits for certain eligible former employees. We use a December 31 measurement date for all our plans. Pension Benefits In connection with the acquisition of Level 3 Communications, Inc. on November 1, 2017, we assumed defined benefit pension plans sponsored by various Level 3 companies for their employees. Based on a valuation analysis, we recognized a $20 million liability on November 1, 2017 for the unfunded status of the Level 3 pension plans, reflecting projected benefit obligations of 167 million , in excess of the $147 million fair value of plan assets. Current funding laws require a company with a pension shortfall to fund the annual cost of benefits earned in addition to a seven -year amortization of the shortfall. Our funding policy for our Combined Plan is to make contributions with the objective of accumulating sufficient assets to pay all qualified pension benefits when due under the terms of the plan. The accounting unfunded status of our qualified pension plan was $2.004 billion and $2.352 billion as of December 31, 2017 and 2016 , respectively. We made a voluntary cash contribution to our qualified pension plan of $100 million in both 2017 and 2016 , and paid $5 million and $7 million of benefits directly to participants of our non-qualified pension plans in 2017 and 2016 , respectively. Based on current laws and circumstances, we are not required to make any contributions to our qualified pension plan in 2018 , but we currently expect to make a voluntary contribution of $100 million to the trust for our qualified pension plan in 2018. We estimate that in 2018 we will pay $5 million of benefits directly to participants of our non-qualified pension plans. As mentioned above, we assumed in the Level 3 acquisition certain contributory and non-contributory employee pension plans, both qualified and non-qualified plans (the “Level 3 Pensions”). At December 31, 2017, the fair value of the Level 3 Pensions’ plan assets was $147 million , and the associated benefit obligation was $167 million . We recognized the unfunded status of Level 3's pension plans of $20 million on our consolidated balance sheet as of December 31, 2017, and the net periodic benefit expense of less than $1 million for the period November 1, 2017 to December 31, 2017, in our consolidated income statement for the year ended December 31, 2017. Due to the insignificant amount of these pension plans, we have predominantly excluded them from the remaining employee benefit disclosures in this Note. Post-Retirement Benefits In connection with our acquisition of Level 3 Communications, Inc. on November 1, 2017, we assumed post-retirement benefit plans sponsored by Level 3 Communications, L.L.C. and Continental Level 3, Inc. for certain of its current and former employees. Based on a valuation analysis, we recognized less than $1 million in liability for the unfunded status of Level 3’s post-retirement benefit plans. Our post-retirement benefit plans provide post-retirement benefits to qualified retirees and allow (i) eligible employees retiring before certain dates to receive benefits at no or reduced cost and (ii) eligible employees retiring after certain dates to receive benefits on a shared cost basis. The post-retirement benefits not paid by the trusts are funded by us and we expect to continue funding these post-retirement obligations as benefits are paid. The accounting unfunded status of our qualified post-retirement benefit plan was $3.352 billion and $3.360 billion as of December 31, 2017 and 2016 , respectively. Assets in the post-retirement trusts have been substantially depleted as of December 31, 2016; however we will continue to pay certain post-retirement benefits through the trusts. No contributions were made to the post-retirement trusts in 2017 and 2016 . Benefits not paid from the trusts are expected to be paid directly by us with available cash. In 2017 , we paid $237 million of post-retirement benefits, net of participant contributions and direct subsidies. In 2018 , we expect to pay $283 million of post-retirement benefits, net of participant contributions and direct subsidies. The increase in anticipated post-retirement benefit payments is the result of increased utilization coupled with a continued rise in the cost of care. We expect our health care cost trend rate to range from 5.0% to 6.5% in 2018, 5.0% to 7.0% in 2019, 5.0% to 6.5% in 2020 and grading to 4.50% by 2025 . Our post-retirement benefit cost, for certain eligible legacy Qwest retirees and certain eligible legacy CenturyLink retirees, is capped at a set dollar amount. Therefore, those health care benefit obligations are not subject to increasing health care trends after the effective date of the caps. As mentioned above, we assumed in the Level 3 acquisition certain post-retirement plans. Though largely unfunded, these post-retirement plans, in the aggregate, are immaterial to our consolidated financial statements. Due to the insignificant amount of these post-retirement plans, we have predominantly excluded them from the remaining employee benefit disclosures in this Note. A change of 100 basis points in the assumed initial health care cost trend rate would have had the following effects in 2017 : 100 Basis Points Change Increase (Decrease) (Dollars in millions) Effect on the aggregate of the service and interest cost components of net periodic post-retirement benefit expense (consolidated statement of operations) $ 2 (2 ) Effect on benefit obligation (consolidated balance sheet) 60 (57 ) Expected Cash Flows The qualified pension, non-qualified pension and post-retirement health care benefit payments and premiums and life insurance premium payments are paid by us or distributed from plan assets. The estimated benefit payments provided below are based on actuarial assumptions using the demographics of the employee and retiree populations and have been reduced by estimated participant contributions. Pension Plans Post-Retirement Benefit Plans Medicare Part D Subsidy Receipts (Dollars in millions) Estimated future benefit payments: 2018 $ 1,031 293 (7 ) 2019 973 280 (7 ) 2020 951 271 (7 ) 2021 929 262 (7 ) 2022 908 253 (7 ) 2023 - 2027 4,170 1,122 (31 ) Net Periodic Benefit Expense In 2016, we changed the method we use to estimate the service and interest components of net periodic benefit expense for pension and other postretirement benefit obligations. This change resulted in a decrease in the service and interest components in 2017 and 2016. Beginning in 2016, we utilized a full yield curve approach in connection with estimating these components by applying the specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows, as opposed to the single weighted-average discount rate derived from the yield curve that we have used in the past. We believe this change more precisely measures service and interest costs by improving the correlation between projected benefit cash flows to the corresponding spot yield curve rates. This change did not affect the measurement of our total benefit obligations but lowered our annual net periodic benefit cost by $122 million and $149 million in 2017 and 2016, respectively, when compared to pre-2016 methodology. This change was treated as a change in accounting estimate and accordingly, we did not adjust the amounts recorded in 2015. The actuarial assumptions used to compute the net periodic benefit expense for our qualified pension, non-qualified pension and post-retirement benefit plans are based upon information available as of the beginning of the year, as presented in the following table. Pension Plans Post-Retirement Benefit Plans 2017 2016 2015 2017 2016 2015 Actuarial assumptions at beginning of year: Discount rate 3.50% - 4.10% 3.50% - 4.50% 3.50% - 4.10% 3.90 % 4.15 % 3.80 % Rate of compensation increase 3.25 % 3.25 % 3.25 % N/A N/A N/A Expected long-term rate of return on plan assets 6.50 % 7.00 % 7.50 % 5.00 % 7.00 % 7.50 % Initial health care cost trend rate N/A N/A N/A 7.00% / 5.00% 5.00% / 5.25% 6.00% / 6.50% Ultimate health care cost trend rate N/A N/A N/A 4.50 % 4.50 % 4.50 % Year ultimate trend rate is reached N/A N/A N/A 2025 2025 2025 _______________________________________________________________________________ N/A-Not applicable Net periodic benefit expense (income) for our qualified and non-qualified pension plans includes the following components: Pension Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Service cost $ 63 64 83 Interest cost 411 427 568 Expected return on plan assets (666 ) (732 ) (898 ) Special termination benefits charge — 13 — Recognition of prior service (credit) cost (8 ) (8 ) 5 Recognition of actuarial loss 205 175 161 Net periodic pension benefit expense (income) $ 5 (61 ) (81 ) Net periodic benefit expense for our post-retirement benefit plans includes the following components: Post-Retirement Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Service cost $ 18 19 24 Interest cost 100 111 140 Expected return on plan assets (2 ) (7 ) (21 ) Special termination benefits charge — 3 — Recognition of prior service cost 20 20 19 Net periodic post-retirement benefit expense $ 136 146 162 We report service costs for our qualified pension, non-qualified pension and post-retirement benefit plans in cost of services and products and selling, general and administrative expenses in our consolidated statements of operations for the years ended December 31, 2017 , 2016 and 2015 . Additionally, a portion of the service cost is also allocated to certain assets under construction, which are capitalized and reflected as part of property, plant and equipment in our consolidated balance sheets. The remaining components of net periodic benefit expense (income) are reported in other income (expense), net in our consolidated statements of operations. In 2016, we announced plans to reduce our workforce, initially through voluntary severance packages and the balance through involuntary reductions, as a result we recognized a one-time charge of $16 million for special termination benefit enhancements paid to certain eligible employees upon voluntary retirement. Benefit Obligations The actuarial assumptions used to compute the funded status for the plans are based upon information available as of December 31, 2017 and 2016 and are as follows: Pension Plans Post-Retirement Benefit Plans December 31, December 31, 2017 2016 2017 2016 Actuarial assumptions at end of year: Discount rate 3.44% - 3.70% 3.50% - 4.10% 3.53 % 3.90 % Rate of compensation increase 3.25 % 3.25 % N/A N/A Initial health care cost trend rate N/A N/A 7.00% / 5.00% 5.00% / 5.50% Ultimate health care cost trend rate N/A N/A 4.50 % 4.50 % Year ultimate trend rate is reached N/A N/A 2025 2025 _______________________________________________________________________________ N/A-Not applicable In 2017, 2016 and 2015, we adopted the revised mortality tables and projection scales released by the Society of Actuaries ("SOA"), which decreased the projected benefit obligation of our benefit plans by $113 million , $268 million and $379 million , respectively. The change in the projected benefit obligation of our benefit plans was recognized as part of the net actuarial loss and is included in accumulated other comprehensive loss, a portion of which is subject to amortization over the remaining estimated life of plan participants, which was approximately 9 to 10 years as of December 31, 2017 . The following tables summarize the change in the benefit obligations for the pension and post-retirement benefit plans: Pension Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Change in benefit obligation Benefit obligation at beginning of year $ 13,301 13,349 15,042 Service cost 63 64 83 Interest cost 411 427 568 Plan amendments — 2 (100 ) Special termination benefits charge — 13 — Actuarial loss (gain) 590 487 (800 ) Benefits paid by company (5 ) (7 ) (6 ) Benefits paid from plan assets (1,238 ) (1,034 ) (1,438 ) Benefit obligation at end of year $ 13,122 13,301 13,349 Post-Retirement Benefit Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Change in benefit obligation Benefit obligation at beginning of year $ 3,413 3,567 3,830 Service cost 18 19 24 Interest cost 100 111 140 Participant contributions 54 57 57 Direct subsidy receipts 7 5 8 Special termination benefits charge — 3 — Actuarial loss (gain) 112 (13 ) (148 ) Benefits paid by company (298 ) (191 ) (181 ) Benefits paid from plan assets (31 ) (145 ) (163 ) Benefit obligation at end of year $ 3,375 3,413 3,567 Our aggregate benefit obligation as of December 31, 2017 , 2016 and 2015 was $16.497 billion , $16.714 billion and $16.916 billion , respectively. Plan Assets We maintain plan assets for our qualified pension plan and certain post-retirement benefit plans. The qualified pension plan's assets are used for the payment of pension benefits and certain eligible plan expenses. The post-retirement benefit plan's assets are used to pay health care benefits and premiums on behalf of eligible retirees and to pay certain eligible plan expenses. As discussed further above, the liquid plan assets in our post-retirement trust have been substantially depleted as of December 31, 2017. The expected rate of return on plan assets is the long-term rate of return we expect to earn on the plans' assets, net of administrative expenses paid from plan assets. The rate of return is determined by the strategic allocation of plan assets and the long-term risk and return forecast for each asset class. The forecasts for each asset class are generated primarily from an analysis of the long-term expectations of various third party investment management organizations. The expected rate of return on plan assets is reviewed annually and revised, as necessary, to reflect changes in the financial markets and our investment strategy. The following tables summarize the change in the fair value of plan assets for the pension and post-retirement benefit plans: Pension Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Change in plan assets Fair value of plan assets at beginning of year $ 10,892 11,072 12,571 Return on plan assets 1,306 754 (161 ) Employer contributions 100 100 100 Benefits paid from plan assets (1,238 ) (1,034 ) (1,438 ) Fair value of plan assets at end of year $ 11,060 10,892 11,072 Post-Retirement Benefit Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Change in plan assets Fair value of plan assets at beginning of year $ 53 193 353 Return on plan assets 1 5 3 Benefits paid from plan assets (31 ) (145 ) (163 ) Fair value of plan assets at end of year $ 23 53 193 Pension Plans: Our investment objective for the qualified pension plan assets is to achieve an attractive risk-adjusted return over time that will provide for the payment of benefits and minimize the risk of large losses. Our pension plan investment strategy is designed to meet this objective by broadly diversifying plan assets across numerous strategies with differing expected returns, volatilities and correlations. The pension plan assets have target allocations of 45% to interest rate sensitive investments and 55% to investments designed to provide higher expected returns than the interest rate sensitive investments. Interest rate sensitive investments include 30% of plan assets targeted primarily to long-duration investment grade bonds, 10% targeted to high yield and emerging market bonds and 5% targeted to diversified strategies, which primarily have exposures to global bonds, as well as some exposures to global stocks and commodities. Assets expected to provide higher returns than the interest rate sensitive assets include broadly diversified equity investments with targets of approximately 15% to U.S. equity markets and 15% to non-U.S. developed and emerging markets. Approximately 7% is targeted to broadly diversified multi-asset class strategies that have the flexibility to adjust exposures to different asset classes. Approximately 10% is allocated to private markets investments including funds primarily invested in private equity, private debt and hedge funds. Real estate investments are targeted at 8% of plan assets. At the beginning of 2018 , our expected annual long-term rate of return on pension assets before consideration of administrative expenses is assumed to be 7.0% . However, projected increases in PBGC (Pension Benefit Guaranty Corporation) premium rates have now become large enough to reduce the annual long-term expected return net of administrative expenses to 6.5% . Our non-qualified pension plans are not funded. We pay benefits directly to the participants of these plans. Post-Retirement Benefit Plans: Our investment objective for the post-retirement benefit plans' assets is to achieve an attractive risk-adjusted return and minimize the risk of large losses over the expected life of the assets. At the beginning of 2018 , our expected annual long-term rate of return on post-retirement benefit plan assets is assumed to be 4.0% . Permitted investments: Plan assets are managed consistent with the restrictions set forth by the Employee Retirement Income Security Act of 1974, as amended, which requires diversification of assets and also generally prohibits defined benefit and welfare plans from investing more than 10% of their assets in securities issued by the sponsor company. At December 31, 2017 and 2016 , the post-retirement benefit plans did not directly own any shares of our common stock or debt instruments. At December 31, 2017, the pension benefit plan directly held approximately $4 million of our equity securities and approximately $2 million of CenturyLink, Inc. debt securities. At December 31, 2016 the pension benefit plan held approximately $1 million of our debt securities. Derivative instruments: Derivative instruments are used to reduce risk as well as provide return. The pension plan uses exchange traded futures and swaps to gain exposure to equity and interest rate markets consistent with target asset allocations and to reduce risk relative to measurement of the benefit obligation, which is sensitive to interest rate changes. Foreign exchange forward contracts are used to manage currency exposures. Credit default swaps are used to manage credit risk exposures in a cost effective and targeted manner relative to transacting with physical corporate fixed income securities. Options are currently used to manage interest rate exposure taking into account the implied volatility and current pricing of the specific underlying market instrument. Some derivative instruments subject the plans to counterparty risk. The external investment managers, along with Plan Management, monitor counterparty exposure and mitigate this risk by diversifying the exposure among multiple high credit quality counterparties, requiring collateral and limiting exposure by periodically settling contracts. The gross notional exposure of the derivative instruments directly held by the pension benefit plan is shown below. The notional amount of the derivatives corresponds to market exposure but does not represent an actual cash investment. Our post-retirement plans were not invested in derivative instruments for the years ended December 31, 2017 or 2016. Gross Notional Exposure Pension Plan Years Ended December 31, 2017 2016 (Dollars in millions) Derivative instruments: Exchange-traded U.S. equity futures $ 256 104 Exchange-traded Treasury and other interest rate futures 1,830 1,813 Interest rate swaps 137 260 Credit default swaps 100 240 Equity index swaps 1 — Foreign exchange forwards 293 778 Options 259 206 Fair Value Measurements: Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between independent and knowledgeable parties who are willing and able to transact for an asset or liability at the measurement date. We use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs when determining fair value and then we rank the estimated values based on the reliability of the inputs used following the fair value hierarchy set forth by the FASB. For additional information on the fair value hierarchy, see Note 12—Fair Value Disclosure. At December 31, 2017 , we used the following valuation techniques to measure fair value for assets. There were no changes to these methodologies during 2017 : • Level 1—Assets were valued using the closing price reported in the active market in which the individual security was traded. • Level 2—Assets were valued using quoted prices in markets that are not active, broker dealer quotations, net asset value of shares held by the plans and other methods by which all significant inputs were observable at the measurement date. • Level 3—Assets were valued using unobservable inputs in which little or no market data exists as reported by the respective institutions at the measurement date. The tables below present the fair value of plan assets by category and the input levels used to determine those fair values at December 31, 2017 . It is important to note that the asset allocations do not include market exposures that are gained with derivatives. Investments include dividend and interest receivables, pending trades and accrued expenses. Fair Value of Pension Plan Assets at December 31, 2017 Level 1 Level 2 Level 3 Total (Dollars in millions) Investment grade bonds (a) $ 432 1,315 — $ 1,747 High yield bonds (b) — 575 7 582 Emerging market bonds (c) 217 219 1 437 U.S. stocks (e) 1,030 2 3 1,035 Non-U.S. stocks (f) 706 — — 706 Private debt (i) — — 15 15 Multi-asset strategies (l) 440 — — 440 Derivatives (m) 2 — — 2 Cash equivalents and short-term investments (n) — 476 1 477 Total investments, excluding investments valued at NAV $ 2,827 2,587 27 5,441 Investments valued at NAV 5,619 Total pension plan assets $ 11,060 Fair Value of Post-Retirement Plan Assets Level 1 Level 2 Level 3 Total (Dollars in millions) Investment grade bonds (a) $ — — — $ — High yield bonds (b) — — — — U.S. stocks (e) 1 — — 1 Non-U.S. stocks (f) — — — — Cash equivalents and short-term investments (n) — — — — Total investments, excluding investments valued at NAV $ 1 — — 1 Investments valued at NAV 22 Total post-retirement plan assets $ 23 The tables below present the fair value of plan assets by category and the input levels used to determine those fair values at December 31, 2016 . It is important to note that the asset allocations do not include market exposures that are gained with derivatives. Investments include dividend and interest receivable, pending trades and accrued expenses. Fair Value of Pension Plan Assets at December 31, 2016 Level 1 Level 2 Level 3 Total (Dollars in millions) Investment grade bonds (a) $ 420 1,404 — $ 1,824 High yield bonds (b) 7 597 11 615 Emerging market bonds (c) 212 212 — 424 U.S. stocks (e) 1,146 1 — 1,147 Non-U.S. stocks (f) 721 1 — 722 Multi-asset strategies (l) 389 — — 389 Cash equivalents and short-term investments (n) — 207 — 207 Total investments, excluding investments valued at NAV $ 2,895 2,422 11 5,328 Investments valued at NAV 5,564 Total pension plan assets $ 10,892 Fair Value of Post-Retirement Plan Assets Level 1 Level 2 Level 3 Total (Dollars in millions) Investment grade bonds (a) $ 1 2 — $ 3 High yield bonds (b) — 1 — 1 U.S. stocks (e) 2 — — 2 Non-U.S. stocks (f) 1 — — 1 Cash equivalents and short-term investments (n) — 5 — 5 Total investments, excluding investments valued at NAV $ 4 8 — 12 Investments valued at NAV 41 Total post-retirement plan assets $ 53 The table below presents the fair value of plan assets valued at NAV by category for our pension and post-retirement plans at December 31, 2017 and 2016. Fair Value of Plan Assets Valued at NAV Pension Plans at December 31, Post-Retirement Benefit Plans at December 31, 2017 2016 2017 2016 (Dollars in millions) Investment grade bonds (a) $ 163 106 — — High yield bonds (b) 483 521 — 1 Emerging market bonds (c) 14 6 — — Diversified strategies (d) 538 522 — 1 U.S. stocks (e) 73 58 — — Non-U.S. stocks (f) 627 560 — 1 Emerging market stocks (g) 98 76 — — Private equity (h) 460 506 10 14 Private debt (i) 374 369 1 1 Market neutral hedge funds (j) 769 739 — 1 Directional hedge funds (j) 636 657 — 1 Real estate (k) 903 926 1 8 Multi-asset strategies (l) 424 412 — — Cash equivalents and short-term investments (n) 57 106 10 13 Total investments valued at NAV $ 5,619 5,564 22 41 The plans' assets are invested in various asset categories utilizing multiple strategies and investment managers. Interests in commingled funds are valued using the net asset value ("NAV") per unit of each fund. The NAV reported by the fund manager is based on the market value of the underlying investments owned by each fund, minus its liabilities, divided by the number of shares outstanding. Commingled funds can be redeemed at NAV, generally within a year of the financial statement date. Investments in private funds, primarily limited partnerships, represent long-term commitments with a fixed maturity date and are also valued at NAV. Valuation inputs for these private fund interests are generally based on assumptions and other information not observable in the market. The assumptions and valuation methodologies of the pricing vendors, account managers, fund managers and partnerships are monitored and evaluated for reasonableness. Below is an overview of the asset categories, the underlying strategies and valuation inputs used to value the assets in the preceding tables: (a) Investment grade bonds represent investments in fixed income securities as well as commingled bond funds comprised of U.S. Treasury securities, agencies, corporate bonds, mortgage-backed securities, asset-backed securities and commercial mortgage-backed securities. Treasury securities are valued at the bid price reported in the active market in which the security is traded and are classified as Level 1. The valuation inputs of other investment grade bonds primarily utilize observable market information and are based on a spread to U.S. Treasury securities and consider yields available on comparable securities of issuers with similar credit ratings. The primary observable inputs include references to the new issue market for similar securities, the secondary trading markets and dealer quotes. Option adjusted spread models are utilized to evaluate securities such as asset backed securities that have early redemption features. These securities are classified as Level 2. The commingled funds are valued at NAV based on the market value of the underlying fixed income securities using the same valuation inputs previously described. (b) High yield bonds represent investments in below investment grade fixed income securities as well as commingled high yield bond funds. The valuation inputs for the securities primarily utilize observable market information and are based on a spread to U.S. Treasury securities and consider yields available on comparable securities of issuers with similar credit ratings. These securities are primarily classified as Level 2. Securities whose valuation inputs are not based on observable market information are classified as Level 3. The commingled funds are valued at NAV based on the market value of the underlying high yield instruments using the same valuation inputs previously described. (c) Emerging market bonds represent investments in securities issued by governments and other entities located in developing countries as well as registered mutual funds and commingled emerging market bond funds. The valuation inputs for the securities utilize observable market information and are primarily based on dealer quotes or a spread relative to the local government bonds. The registered mutual fund is classified as Level 1 while individual securities are primarily classified as Level 2. Securities whose valuation inputs are not based on observable market information are classified as Level 3. The commingled funds are valued at NAV based on the market value of the underlying emerging market bonds using the same valuation inputs previously described. (d) Diversified strategies represent an investment in a commingled fund that primarily has exposures to global government, corporate and inflation linked bonds, global stocks and commodities. This asset category includes investments in a registered mutual fund which is classified at Level 1, and a commingled fund which is valued at NAV based on the market value of the underlying investments. The valuation inputs utilize observable market information including published prices for exchange traded securities, bid prices for government bonds, and spreads and yields available for comparable fixed income securities with similar credit ratings. (e) U.S. stocks represent investments in stocks of U.S. based companies as well as commingled U.S. stock funds. The valuation inputs for U.S. stocks are based on the last published price reported on the major stock market on which the securities are traded and are primarily classified as Level 1. Securities whose valuation inputs are not based on observable market information are classified as Level 3. The commingled funds are valued at NAV based on the market value of the underlying investments using the same valuation inputs previously described. (f) Non-U.S. stocks represent investments in stocks of companies based in developed countries outside the U.S. as well as commingled funds. The valuation inputs for non-U.S. stocks are based on the last published price reported on the major stock market on which the securities are traded and are primarily classified as Level 1. The commingled funds are valued at NAV based on the market value of the underlying investments using the same valuation inputs previously described. (g) Emerging market stocks represent investments in commingled funds comprised of stocks of companies located in developing markets. The commingled funds are valued at NAV based on the market value of the underlying investments using the same valuation inputs described previously for individual stocks. (h) Private equity represents non-public investments in domestic and foreign buy out and venture capital funds. Private equity funds are primarily structured as limited partnerships and are valued according to the valuation policy of each partnership, subject to prevailing accounting and other regulatory guidelines. The partnerships are valued at NAV using valuation methodologies that consider a range of factors, including but not limited to the price at which investments were acquired, the nature of the investments, market conditions, trading values on comparable public securities, current and projected operating performance, and financing transactions subsequent to the acquisition of the investments. These valuation methodologies involve a significant degree of judgment. (i) Private debt represents non-public investments in distressed or mezzanine debt funds and pension group insurance contracts. Pension group insurance contracts are valued based on actuarial assumptions, and are classified as Level 3. Mezzanine debt instruments are debt instruments that are subordinated to other debt issues and may include embedded equity instruments such as warrants. Private debt funds are primar |
Share-based Compensation
Share-based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Compensation | Share-based Compensation We maintain equity programs that allow our Board of Directors (through its Compensation Committee or our Chief Executive Officer as its delegate) to grant incentives to certain employees and our outside directors in any one or a combination of several forms, including incentive and non-qualified stock options, stock appreciation rights, restricted stock awards, restricted stock units and market and performance shares. Stock options generally expire ten years from the date of grant. Acquisition of Level 3 Upon the November 1, 2017 closing of our acquisition of Level 3, and pursuant to the terms of the merger agreement, we replaced certain of Level 3's share-based compensation awards with our share-based compensation awards. Specifically: • each outstanding Level 3 restricted stock unit award granted prior to April 1, 2014 or granted to an outside director of Level 3 was converted into $26.50 in cash and 1.4286 shares of our common stock (and cash in lieu of fractional shares) with respect to each Level 3 share covered by such award (the "Converted RSU Awards"); and • each outstanding Level 3 restricted stock unit award granted on or after April 1, 2014 (other than these granted to outside directors of Level 3) was converted into a CenturyLink restricted stock unit award using a conversion ratio of 2.8386 to 1 as determined in accordance with a formula set forth in the merger agreement (the "Continuing RSU Awards") . The preliminary aggregate fair value of the replaced Level 3 awards was $239 million , of which $103 million was attributable to service performed prior to the acquisition date and was included in the cost of the acquisition. The fair value of CenturyLink shares was determined based on the $18.99 closing price of our common stock on November 1, 2017. The remaining $137 million of the preliminary aggregate fair value of the replaced Level 3 awards was attributable to post-acquisition period and is being recognized as compensation expense, net of estimated forfeitures, over the remaining vesting period from 1 to 2 years. Stock Options The following table summarizes activity involving stock option awards for the year ended December 31, 2017 : Number of Options Weighted- Average Exercise Price (in thousands) Outstanding and Exercisable at December 31, 2016 3,008 $ 40.08 Exercised (12 ) 10.75 Forfeited/Expired (1,974 ) 46.82 Outstanding and Exercisable at December 31, 2017 1,022 27.41 The aggregate intrinsic value of our options outstanding and exercisable at December 31, 2017 was less than $1 million . The weighted-average remaining contractual term for such options was 1.44 years . During 2017 , we received net cash proceeds of less than $1 million in connection with our option exercises. The tax benefit realized from these exercises was less than $1 million . The total intrinsic value of options exercised for the years ended December 31, 2017 and 2016 , was less than $1 million each year. The total intrinsic value of options exercised for the year ended December 31, 2015 was $4 million . Restricted Stock Awards For equity based restricted stock awards that contain only service conditions for vesting (time-based awards), we calculate the award fair value based on the closing price of CenturyLink common stock on the accounting grant date. We also grant equity based awards that contain service conditions as well as additional market or performance conditions. For awards with service and market conditions, the award fair value is calculated using Monte-Carlo simulations. Awards with service as well as market or performance conditions specify a target number of shares for the award. Each recipient ultimately has the opportunity to receive between 0% and 200% of the target number of shares. For awards with service and market conditions, the percentage received is based on our total shareholder return over the three -year service period versus that of selected peer companies. For awards with service and performance conditions, the percentage received depends upon the attainment of two financial performance targets during the three -year service period. Awards Granted in 2017 In 2017, we granted 6 million shares of restricted stock awards, of which 4.7 million shares contained only service conditions and 1.3 million target shares that contained service conditions and either market or performance conditions. The details of these grants are as follows: During the first quarter of 2017, we granted 784 thousand shares of restricted stock to certain executive level employees as part of our long-term incentive program, of which 314 thousand shares contained only service conditions and will vest on a straight-line basis on February 21, 2018, 2019 and 2020. The remaining awards, 470 thousand target shares, contain service conditions and either market or performance conditions and are scheduled to vest on February 21, 2020. During the first quarter of 2017, we also granted 2 million shares to certain key employees as part of our annual equity compensation program, of which 1.8 million shares contained only service conditions and will vest on a straight-line basis on February 20, 2018, 2019 and 2020. The remaining awards, 200 thousand target shares, contain service conditions and either market or performance conditions and are scheduled to vest on February 20, 2020. During the second quarter of 2017, we granted 894 thousand shares to certain executive level employees as integration and retention awards related to the Level 3 acquisition, of which 647 thousand shares of the retention awards will vest on June 1, 2018, 2019 and 2020. The remaining retention awards, 125 thousand shares, will vest on December 15, 2018 and 2019. Integration awards, which contain service and performance conditions, specify a target number of shares for the award. Each recipient ultimately has the opportunity to receive from 80% to 120% of the target number of shares. Integration awards of 122 thousand target shares are scheduled to vest on December 15, 2018. During the fourth quarter of 2017, we granted 948 thousand shares of restricted stock to certain executive level employees as part of our long-term equity retention program. Time-based awards totaled 493 thousand shares. The remaining awards, 455 thousand target shares, contain service conditions and either market or performance conditions are scheduled to vest on March 31, 2019 and November 1, 2020. We also granted 1.1 million shares to certain key employees as part of our special retention program. Of these, time-based awards totaled 911 thousand shares and will vest on November 1, 2019 and 2020. The remaining awards, 187 thousand shares, are scheduled to vest on November 1, 2018, 2019 and 2020. Awards Granted in 2016 In 2016, we granted 3.8 million shares of restricted stock awards, of which 3.1 million shares contained only service conditions and 700 thousand target shares that contained service conditions and either market or performance conditions. The details of these grants are as follows: During the first quarter of 2016, we granted 766 thousand shares of restricted stock to certain executive level employees as part of our long-term incentive program, of which 306 thousand contained only service conditions and will vest on a straight-line basis on February 23, 2017, 2018 and 2019. The remaining awards, 460 thousand target shares, contain service conditions and either market or performance conditions and are scheduled to vest on February 23, 2019. During the first quarter of 2016, we also granted 1.9 million shares to certain key employees as part of our annual equity compensation program, of which 1.7 million contained only service conditions and will vest on a straight-line basis on February 25, 2017, 2018 and 2019. The remaining awards, 200 thousand target shares, contain service conditions and either market or performance conditions and are scheduled to vest on February 25, 2019. During the first and third quarter of 2016, we granted shares to certain key employees as part of our long-term equity retention program. These awards will vest over a three to seven year period with 113 thousand , 322 thousand and 209 thousand shares vesting on August 16, 2019, 2021 and 2023, respectively, and 22 thousand shares vesting on January 13, 2021 and 22 thousand shares vesting on January 13, 2023. The remaining awards granted throughout 2016 to certain other key employees and our outside directors were made as part of our equity compensation and retention programs. These awards require only service conditions for vesting and typically vest equally over a three year period. Awards Granted in 2015 In 2015, we granted 2.9 million shares of restricted stock awards, of which 2.6 million shares contained only service conditions and 300 thousand target shares that contained service conditions and either market or performance conditions. The details of these grants are as follows: During the first quarter of 2015, we granted 496 thousand shares of restricted stock to certain executive-level employees as part of our long-term incentive program, of which 198 thousand contained only service conditions and will vest on a straight-line basis on February 23, 2016, 2017 and 2018. The remaining awards, 298 thousand target shares, contain service conditions and market or performance conditions and are scheduled to vest on February 23, 2018. At the end of the first quarter of 2015, we granted 1.2 million shares to certain key employees as part of our annual equity compensation program. These awards contained only service conditions and will vest on a straight-line basis on March 12, 2016, 2017 and 2018. During the third quarter of 2015 we granted shares to certain key employees as part of our long-term equity retention program. These awards will vest over a three to seven year period with 193 thousand , 423 thousand and 230 thousand shares vesting on August 14, 2018, 2020 and 2022, respectively, and 55 thousand shares vesting equally on August 14, 2017, 2019, and 2021. The remaining awards granted throughout 2015 to certain other key employees and our outside directors were made as part of our equity compensation and retention programs. These awards require only service conditions for vesting and typically vest equally over a three year period. The following table summarizes activity involving restricted stock and restricted stock unit awards for the year ended December 31, 2017 : Number of Shares Weighted- Average Grant Date Fair Value (in thousands) Non-vested at December 31, 2016 5,948 $ 31.89 Level 3 replacement awards 12,530 18.99 Granted (1) 5,223 22.02 Vested (2,762 ) 28.55 Forfeited (1,165 ) 26.43 Non-vested at December 31, 2017 19,774 21.90 _____________________________________________________________________________ (1) Shares granted whose related performance conditions were not finalized at December, 31, 2017, were excluded from this figure. During 2016 , we granted 3.6 million shares of restricted stock and restricted stock unit awards at a weighted-average price of $30.83 . During 2015, we granted 2.9 million shares of restricted stock and restricted stock unit awards at a weighted-average price of $31.83 . The total fair value of restricted stock that vested during 2017 , 2016 and 2015 , was $60 million , $47 million and $59 million , respectively. Compensation Expense and Tax Benefit We recognize compensation expense related to our market and performance share-based awards with graded vesting that only have a service condition on a straight-line basis over the requisite service period for the entire award. Total compensation expense for all share-based payment arrangements for the years ended December 31, 2017 , 2016 and 2015 , was $111 million , $80 million and $73 million , respectively. Our tax benefit recognized in the consolidated statements of operations for our share-based payment arrangements for the years ended December 31, 2017 , 2016 and 2015 , was $28 million , $31 million and $28 million , respectively. At December 31, 2017 , there was $240 million of total unrecognized compensation expense related to our share-based payment arrangements, which we expect to recognize over a weighted-average period of 1.9 years. |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | Earnings Per Common Share Basic and diluted earnings per common share for the years ended December 31, 2017 , 2016 and 2015 were calculated as follows: Years Ended December 31, 2017 2016 2015 (Dollars in millions, except per share amounts, shares in thousands) Income (Numerator): Net income $ 1,389 626 878 Earnings applicable to non-vested restricted stock — — — Net income applicable to common stock for computing basic earnings per common share 1,389 626 878 Net income as adjusted for purposes of computing diluted earnings per common share $ 1,389 626 878 Shares (Denominator): Weighted average number of shares: Outstanding during period 635,576 545,946 559,260 Non-vested restricted stock (7,768 ) (6,397 ) (4,982 ) Weighted average shares outstanding for computing basic earnings per common share 627,808 539,549 554,278 Incremental common shares attributable to dilutive securities: Shares issuable under convertible securities 10 10 10 Shares issuable under incentive compensation plans 875 1,120 805 Number of shares as adjusted for purposes of computing diluted earnings per common share 628,693 540,679 555,093 Basic earnings per common share $ 2.21 1.16 1.58 Diluted earnings per common share $ 2.21 1.16 1.58 Our calculation of diluted earnings per common share excludes shares of common stock that are issuable upon exercise of stock options when the exercise price is greater than the average market price of our common stock. We also exclude unvested restricted stock awards that are antidilutive as a result of unrecognized compensation cost. Such shares averaged 4.7 million , 3.3 million and 3.1 million for 2017 , 2016 and 2015 , respectively. |
Fair Value Disclosure
Fair Value Disclosure | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosure | Fair Value Disclosure Our financial instruments consist of cash, cash equivalents and restricted cash, accounts receivable, accounts payable and long-term debt, excluding capital lease and other obligations. Due to their short-term nature, the carrying amounts of our cash, cash equivalents and restricted cash, accounts receivable and accounts payable approximate their fair values. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between independent and knowledgeable parties who are willing and able to transact for an asset or liability at the measurement date. We use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs when determining fair value and then we rank the estimated values based on the reliability of the inputs used following the fair value hierarchy set forth by the FASB. We determined the fair values of our long-term debt, including the current portion, based on quoted market prices where available or, if not available, based on discounted future cash flows using current market interest rates. The three input levels in the hierarchy of fair value measurements are defined by the FASB generally as follows: Input Level Description of Input Level 1 Observable inputs such as quoted market prices in active markets. Level 2 Inputs other than quoted prices in active markets that are either directly or indirectly observable. Level 3 Unobservable inputs in which little or no market data exists. The following table presents the carrying amounts and estimated fair values of our long-term debt, excluding capital lease and other obligations, as well as the input level used to determine the fair values indicated below: As of December 31, 2017 As of December 31, 2016 Input Level Carrying Amount Fair Value Carrying Amount Fair Value (Dollars in millions) Liabilities-Long-term debt, excluding capital lease and other obligations 2 $ 36,835 36,402 19,553 19,639 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On December 22, 2017, the Tax Cuts and Jobs Act (the "Act") was signed into law. The Act significantly changes U.S. tax law. The Act reduces the U.S. corporate income tax rate from a maximum of 35% to 21% for all corporations, effective January 1, 2018, and makes certain changes to U.S. taxation of income earned by foreign subsidiaries, capital expenditures, interest expense and various other items. As a result of the reduction in the U.S. corporate income tax rate from 35% to 21% , we re-measured our net deferred tax liabilities at December 31, 2017 and recognized a provisional tax benefit of approximately $1.1 billion in our consolidated statement of operations for the year ended December 31, 2017. The Act imposed a one-time repatriation tax on certain earnings of foreign subsidiaries. The Act also includes certain anti-abuse and base erosion provisions that may impact the amounts of U.S. tax that we pay with respect to income earned by our foreign subsidiaries. We have not yet been able to make a reasonable estimate of the impact of these provisions and continue to account for these items based on our existing accounting under U.S. GAAP and the provisions of the tax laws that were in effect prior to the Act's enactment. On December 22, 2017, the SEC staff addressed the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Act. We have provisionally recognized the tax impacts related to the re-measurement of deferred tax assets and liabilities in the amount noted above in our consolidated financial statements for the year ended December 31, 2017. The ultimate impact may differ from our provisional amount due to additional analysis, changes in interpretations and assumptions we have made, additional regulatory guidance that may be issued, and actions we may take as a result of the Act. The change from our current provisional estimates will be reflected in our future statements of operations and could be material. We expect to complete the accounting by the time we file our 2017 U.S. corporate income tax return in the 4th quarter of 2018, although we cannot assure you of this. Years Ended December 31, 2017 2016 2015 (Dollars in millions) Income tax expense was as follows: Federal Current $ 82 335 28 Deferred (988 ) 5 329 State Current 21 27 40 Deferred 16 8 21 Foreign Current 22 26 16 Deferred (2 ) (7 ) 4 Total income tax expense $ (849 ) 394 438 Years Ended December 31, 2017 2016 2015 (Dollars in millions) Income tax (benefit) expense was allocated as follows: Income tax (benefit) expense in the consolidated statements of operations: Attributable to income $ (849 ) 394 438 Stockholders' equity: Compensation expense for tax purposes in excess of amounts recognized for financial reporting purposes — (2 ) (5 ) Tax effect of the change in accumulated other comprehensive loss 81 (109 ) 59 The following is a reconciliation from the statutory federal income tax rate to our effective income tax rate: Years Ended December 31, 2017 2016 2015 (Percentage of pre-tax income) Statutory federal income tax rate 35.0 % 35.0 % 35.0 % State income taxes, net of federal income tax benefit 3.9 % 2.3 % 2.6 % Change in liability for unrecognized tax position 1.0 % 0.2 % 0.4 % Tax reform (209.8 )% — % — % Net foreign income taxes (0.7 )% 0.1 % 0.7 % Foreign dividend paid to a domestic parent company 0.2 % 1.8 % — % Affiliate debt rationalization — % — % (2.6 )% Research and development credits (1.4 )% (0.6 )% (2.1 )% Tax impact on sale of data centers and colocation business 5.0 % — % — % Level 3 acquisition transaction costs 6.0 % — % — % Other, net 3.6 % (0.2 )% (0.7 )% Effective income tax rate (157.2 )% 38.6 % 33.3 % The effective tax rate for the year ended December 31, 2017 reflects the benefit of approximately $1.1 billion from the re-measurement of deferred taxes as noted above, a $27 million tax expense related to the sale of our colocation business and $32 million tax impact of non-deductible transaction costs related to the Level 3 acquisition. The effective tax rate for the year ended December 31, 2016 reflects a tax impact of $18 million from an intercompany dividend payment from one of our foreign subsidiaries to its domestic parent company that was made as part of our corporate restructuring in preparation for the sale of our colocation business. The 2015 rate reflects a tax benefit of approximately $34 million related to affiliate debt rationalization, research and development tax credits of $28 million for 2011 through 2015 and a $16 million tax decrease due to changes in state taxes caused by apportionment changes, state tax rate changes and the changes in the expected utilization of net operating loss carryforwards ("NOLs"). The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities were as follows: As of December 31, 2017 2016 (Dollars in millions) Deferred tax assets Post-retirement and pension benefit costs $ 1,321 2,175 Net operating loss carryforwards 3,951 473 Other employee benefits 112 125 Other 714 342 Gross deferred tax assets 6,098 3,115 Less valuation allowance (1,341 ) (375 ) Net deferred tax assets 4,757 2,740 Deferred tax liabilities Property, plant and equipment, primarily due to depreciation differences (2,935 ) (3,626 ) Goodwill and other intangible assets (3,785 ) (2,577 ) Other (16 ) — Gross deferred tax liabilities (6,736 ) (6,203 ) Net deferred tax liability $ (1,979 ) (3,463 ) Of the $1.979 billion and $3.463 billion net deferred tax liability at December 31, 2017 and 2016 , respectively, $2.413 billion and $3.471 billion is reflected as a long-term liability and $434 million and $8 million is reflected as a net noncurrent deferred tax asset at December 31, 2017 and 2016 , respectively. At December 31, 2017 , we had federal NOLs of $9.1 billion and state NOLs of $21 billion . If unused, the NOLs will expire between 2018 and 2033 ; however, no significant amounts expire until 2023. We also had foreign NOL carryforwards of $5.8 billion as a result of the Level 3 acquisition. At December 31, 2017 , we had an immaterial amount of federal tax credits. Our acquisitions of Level 3, Qwest and SAVVIS, Inc. ("Savvis") caused "ownership changes" within the meaning of Section 382 of the Internal Revenue Code ("Section 382"). As a result, our ability to use these NOLs and AMT credits are subject to annual limits imposed by Section 382. Despite this, we expect to use substantially all of these tax attributes to reduce our future federal tax liabilities, although the timing of that use will depend upon our future earnings and future tax circumstances. We establish valuation allowances when necessary to reduce the deferred tax assets to amounts we expect to realize. As of December 31, 2017 , a valuation allowance of $1.341 billion was established as it is more likely than not that this amount of net operating loss, capital loss and tax credit carryforwards will not be utilized prior to expiration. Our valuation allowance at December 31, 2017 and 2016 is primarily related to foreign and state NOL carryforwards. This valuation allowance increased by $966 million during 2017 , primarily due to the acquisition of Level 3 and the related valuation allowances. A reconciliation of the change in our gross unrecognized tax benefits (excluding both interest and any related federal benefit) from January 1 to December 31 for 2017 and 2016 is as follows: 2017 2016 (Dollars in millions) Unrecognized tax benefits at beginning of year $ 16 15 Assumed in the acquisition of Level 3 18 — Tax position of prior periods netted against deferred tax assets assumed in the acquisition of Level 3 2 — Increase in tax positions taken in the current year 1 1 Increase in tax positions taken in the prior year 3 — Unrecognized tax benefits at end of year $ 40 16 The total amount of unrecognized tax benefits that, if recognized, would impact the effective income tax rate was $66 million and $34 million at December 31, 2017 and 2016 , respectively. Our policy is to reflect interest expense associated with unrecognized tax benefits in income tax expense. We had accrued interest (presented before related tax benefits) of approximately $56 million and $35 million at December 31, 2017 and 2016 , respectively. We, or at least one of our subsidiaries, file income tax returns in the U.S. federal jurisdiction and various states and foreign jurisdictions. With few exceptions, we are no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2003. The Internal Revenue Service and state and local taxing authorities reserve the right to audit any period where net operating loss carryforwards are available. Based on our current assessment of various factors, including (i) the potential outcomes of these ongoing examinations, (ii) the expiration of statute of limitations for specific jurisdictions, (iii) the negotiated settlement of certain disputed issues, and (iv) the administrative practices of applicable taxing jurisdictions, it is reasonably possible that the related unrecognized tax benefits for uncertain tax positions previously taken may decrease by up to $16 million within the next 12 months. The actual amount of such decrease, if any, will depend on several future developments and events, many of which are outside our control. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information In January 2017, we implemented a new organization structure designed to further strengthen our ability to attain our operational, strategic and financial goals. Prior to this reorganization, we operated and reported as two segments, business and consumer. As a result of this reorganization, we changed the name of the predecessor business segment to "enterprise" segment. Additionally, we also reassigned our information technology, managed hosting, cloud hosting and hosting area network services from our business segment to a new non-reportable operating segment. We reported two segments, enterprise and consumer, from January 2017 through October 2017. In connection with our acquisition of Level 3 (discussed further in Note 2—Acquisition of Level 3), effective November 1, 2017, we implemented a new organization structure and began managing our operations in two segments: business and consumer. Our consumer segment remains substantially unchanged under this reorganization, and our newly reorganized business segment includes the legacy CenturyLink enterprise segment operations and the legacy Level 3 operations. In addition, we reassigned our information technology, managed hosting, cloud hosting and hosting area network operations back into the business segment from the former non-reportable operating segment. At December 31, 2017, we had the following two segments: • Business Segment. This segment consists generally of providing products and services to small, medium and enterprise business, wholesale and government customers, including other communication providers. Our products and services offered to these customers include our local and long-distance voice, VPN data network, private line (including business data services), Ethernet, information technology, wavelength, broadband, colocation and data center services, managed services, professional and other services provided in connection with selling equipment, network security and various other ancillary services, all of which are described further under "Products and Services Categories"; and • Consumer Segment. This segment consists generally of providing products and services to residential customers. Our products and services offered to these customers include our broadband, local and long-distance voice, video and other ancillary services. The following table summarizes our segment results for 2017 , 2016 and 2015 based on the segment categorization we were operating under at December 31, 2017 . Years Ended December 31, 2017 2016 2015 (Dollars in millions) Total segment revenues $ 16,924 16,766 17,171 Total segment expenses 9,390 9,081 9,025 Total segment income $ 7,534 7,685 8,146 Total margin percentage 45 % 46 % 47 % Business segment: Revenues $ 11,220 10,704 10,977 Expenses 6,847 6,391 6,395 Income $ 4,373 4,313 4,582 Margin percentage 39 % 40 % 42 % Consumer segment: Revenues $ 5,704 6,062 6,194 Expenses 2,543 2,690 2,630 Income $ 3,161 3,372 3,564 Margin percentage 55 % 56 % 58 % Product and Service Categories We categorize our products, services and revenues among the following five categories: • IP and data services , which include primarily VPN data networks, Ethernet, IP, video (including our facilities-based video services and Vyvx broadcast services) and other ancillary services; • Transport and infrastructure , which include broadband, private line (including business data services), data center facilities and services, including cloud, hosting and application management solutions, wavelength, equipment sales and professional services, network security services and other ancillary services; • Voice and collaboration , which includes primarily local and long-distance voice, including wholesale voice, and other ancillary service; • IT and managed services , which include information technology services and managed services, which may be purchased in conjunction with our other network services; • Regulatory revenues, which consists of Universal Service Fund ("USF") and Connect America Fund ("CAF") support payments, USF surcharges and other operating revenues. We receive federal support payments from both federal and state USF programs and from the federal CAF program. The USF and CAF support payments are government subsidies designed to reimburse us for various costs related to certain telecommunications services. We generate other operating revenues from the leasing and subleasing of space in our office buildings, warehouses and other properties and from rental income associated with the failed-sale-leaseback. Because we centrally manage the activities that generate these regulatory revenues, these revenues are not included in our segment revenues. Our operating revenues for our products and services are presented as follows for the years ended December 31, 2017 , 2016 and 2015 : Years Ended December 31, 2017 2016 2015 (Dollars in millions) Business segment IP & Data Services (1) $ 3,595 2,851 2,704 Transport & Infrastructure (2) 3,680 3,929 4,157 Voice & Collaboration (3) 3,294 3,284 3,429 IT & Managed Services (4) 651 640 687 Total business segment revenues 11,220 10,704 10,977 Consumer segment IP & Data Services (5) 448 506 468 Transport & Infrastructure (6) 2,871 2,897 2,829 Voice & Collaboration (3) 2,385 2,659 2,897 Total consumer segment revenues 5,704 6,062 6,194 Non-segment revenues Regulatory revenues (7) 732 704 729 Total non-segment revenues 732 704 729 Total revenues $ 17,656 17,470 17,900 ______________________________________________________________________ (1) Includes primarily VPN data network, Ethernet, IP and ancillary revenues. (2) Includes primarily broadband, private line (including business data services), colocation and data centers, wavelength and ancillary revenues. (3) Includes local, long-distance and other ancillary revenues. (4) Includes IT services and managed services revenues. (5) Includes retail video revenues (including our facilities-based video revenues). (6) Includes primarily broadband and equipment sales and professional services revenues. (7) Includes CAF Phase I, CAF Phase 2, federal and state USF support revenue, sublease rental income and failed-sale leaseback income. We recognize revenues in our consolidated statements of operations for certain USF surcharges and transaction taxes that we bill to our customers. Our consolidated statements of operations also reflect the offsetting expense for the amounts we remit to the government agencies. The total amount of such surcharges and transaction taxes that we included in revenues aggregated to $601 million , $572 million and $544 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. These USF surcharges, where we record revenue, and transaction taxes are assigned to the products and services categories of each segments based on the underlying revenues. We also act as a collection agent for certain other USF and transaction taxes that we are required by government agencies to bill our customers, for which we do not record any revenue or expense because we only act as a pass-through agent. Allocations of Revenues and Expenses Our segment revenues include all revenues from our IP and data services, transport and infrastructure services, voice and collaboration, colocation and security services and IT and managed services as described in more detail above. Our segment revenues are based upon each customer's classification. We report our segment revenues based upon all services provided to that segment's customers. Our segment expenses include specific expenses incurred as a direct result of providing services and products to segment customers, along with selling, general and administrative expenses that are (i) directly associated with specific segment customers or activities, and (ii) allocated expenses which include network expenses, facilities expenses and other expenses such as fleet and real estate expenses. We do not assign depreciation and amortization expense or impairments to our segments, as the related assets and capital expenditures are centrally managed and are not monitored by or reported to the chief operating decision maker ("CODM") by segment. Generally speaking, severance expenses, restructuring expenses and certain centrally managed administrative functions (such as finance, information technology, legal and human resources) are not assigned to our segments. Interest expense is also excluded from segment results because we manage our financing on a consolidated basis and have not allocated assets or debt to specific segments. Other income and expense items are not monitored as a part of our segment operations and are therefore excluded from our segment results. The following table reconciles segment income to net income for the years ended December 31, 2017 , 2016 and 2015 : Years Ended December 31, 2017 2016 2015 (Dollars in millions) Total segment income $ 7,534 7,685 8,146 Regulatory revenues 732 704 729 Depreciation and amortization (3,936 ) (3,916 ) (4,189 ) Non-segment expenses (2,321 ) (2,140 ) (2,107 ) Other expenses, net (1,469 ) (1,313 ) (1,263 ) Income before income tax expense 540 1,020 1,316 Income tax benefit (expense) 849 (394 ) (438 ) Net income $ 1,389 626 878 We do not have any single customer that provides more than 10% of our consolidated total operating revenues. Approximately 2% of our consolidated total operating revenues come from customers located outside of the U.S. Approximately 10% of our consolidated total assets and approximately 10% of our consolidated long-lived assets are located outside of the U.S. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | Quarterly Financial Data (Unaudited) First Quarter Second Quarter Third Quarter Fourth Quarter Total (Dollars in millions, except per share amounts) 2017 Operating revenues $ 4,209 4,090 4,034 5,323 17,656 Operating income 631 367 487 524 2,009 Net income 163 17 92 1,117 1,389 Basic earnings per common share 0.30 0.03 0.17 1.26 2.21 Diluted earnings per common share 0.30 0.03 0.17 1.26 2.21 2016 Operating revenues $ 4,401 4,398 4,382 4,289 17,470 Operating income 688 647 593 405 2,333 Net income 236 196 152 42 626 Basic earnings per common share 0.44 0.36 0.28 0.08 1.16 Diluted earnings per common share 0.44 0.36 0.28 0.08 1.16 During the first quarter of 2017, we recognized $10 million of expenses related to our acquisition of Level 3 followed by acquisition-related expenses of $18 million , $37 million and $206 million in the second, third and fourth quarters of 2017, respectively. During the first quarter of 2017, depreciation and amortization expense of $50 million was not recognized on colocation assets held for sale. During the second quarter, we recognized a combined loss of $119 million resulting from the sale of the colocation business and data centers and the accounting treatment of the failed-sale-leaseback. During the second quarter of 2017, we recognized a one-time depreciation charge of $44 million related to the failed-sale-leaseback accounting. During the third and fourth quarters of 2017, we recognized $44 million and $20 million , respectively, of interest expense related to CenturyLink, Inc.'s $6 billion secured term loan utilized in the acquisition of Level 3. In the fourth quarter of 2017, we recognized a tax benefit of approximately $1.1 billion due to the change in the federal corporate tax rate from 35% to 21% . During the fourth quarter of 2016, we recognized $164 million of severance expenses and other one-time termination benefits associated with our workforce reductions and $52 million of expenses related to our pending acquisition of Level 3. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We are vigorously defending against all of the matters described below (excluding those referred to under the heading "Hurricane Damage"). As a matter of course, we are prepared to both litigate these matters to judgment, as well as to evaluate and consider all reasonable settlement opportunities. In this Note, when we refer to a class action as "putative" it is because a class has been alleged, but not certified in that matter. We have established accrued liabilities for these matters described below where losses are deemed probable and reasonably estimable. Shareholder Class Action Suit CenturyLink and certain members of the CenturyLink Board of Directors have been named as defendants in a putative shareholder class action lawsuit filed on January 11, 2017 in the 4th Judicial District Court of the State of Louisiana, Ouachita Parish, captioned Jeffery Tomasulo v. CenturyLink, Inc., et al. The complaint asserts, among other things, that the members of CenturyLink’s Board allegedly breached their fiduciary duties to the CenturyLink shareholders in approving the Level 3 merger agreement and, more particularly, that: the consideration that CenturyLink agreed to pay to Level 3 stockholders in the transaction is allegedly unfairly high; the CenturyLink directors allegedly had conflicts of interest in negotiating and approving the transaction; and the disclosures set forth in our preliminary joint proxy statement/prospectus filed in December 2016 are insufficient in that they allegedly fail to contain material information concerning the transaction. The complaint seeks, among other things, a declaration that the members of the CenturyLink Board have breached their fiduciary duties, corrective disclosure, rescissory or other damages and equitable relief, including rescission of the transaction. On February 13, 2017, the parties entered into a memorandum of understanding providing for the settlement of the lawsuit. The proposed settlement is subject to court approval, among other conditions, and the amount of the settlement is not material to our consolidated financial statements. Retiree Benefits Suit In William Douglas Fulghum, et al. v. Embarq Corporation, et al., filed on December 28, 2007 in the United States District Court for the District of Kansas, a group of retirees filed a class action lawsuit challenging the decision to make certain modifications in retiree benefits programs relating to life insurance, medical insurance and prescription drug benefits, generally effective January 1, 2006 and January 1, 2008 (which, at the time of the modifications, were expected to reduce estimated future expenses for the subject benefits by more than $300 million ). Defendants include Embarq, certain of its benefit plans, its Employee Benefits Committee and the individual plan administrator of certain of its benefits plans. Additional defendants include Sprint Nextel and certain of its benefit plans. The court certified classes on the claims for vested benefits and age discrimination, but rejected class certification on the claims for breach of fiduciary duty. On October 14, 2011, the Fulghum lawyers filed a new, related lawsuit, Abbott et al. v. Sprint Nextel et al. In Abbott , approximately 1,500 plaintiffs alleged breach of fiduciary duty in connection with the changes in retiree benefits that were at issue in Fulghum . After extensive district court proceedings in Fulghum , and an interlocutory appeal to the United States Court of Appeals for the Tenth Circuit, defendants prevailed in 2015 on all age discrimination claims and on the majority of claims for vested benefits. The district court in Fulghum subsequently granted judgment in favor of defendants on all remaining vested benefits claims, and in July 2016 ordered that any affected class members could appeal this ruling. No appeal was taken, and all claims for vested benefits thus have lapsed. On August 31, 2016, the parties reached a settlement in principle on all remaining claims in Fulghum and Abbott . Since then, a settlement agreement has been finalized and, per its terms, the settlement funds have been distributed to class members. The settlement payments were not material to our consolidated financial statements. Switched Access Disputes Subsidiaries of CenturyLink, Inc. are among hundreds of companies involved in an industry-wide dispute, raised in nearly 100 federal lawsuits (filed between 2014 and 2016) that have been consolidated in the United States District Court for the Northern District of Texas for pretrial procedures. The disputes relate to switched access charges that local exchange carriers ("LECs") collect from interexchange carriers ("IXCs") for IXCs' use of LEC's access services. In the lawsuits, IXCs, including Sprint Communications Company L.P. ("Sprint") and various affiliates of Verizon Communications Inc. ("Verizon"), assert that federal and state laws bar LECs from collecting access charges when IXCs exchange certain types of calls between mobile and wireline devices that are routed through an IXC. Some of these IXCs have asserted claims seeking refunds of payments for access charges previously paid and relief from future access charges. In November 2015, the federal court agreed with the LECs and rejected the IXCs' contention that federal law prohibits these particular access charges, and also allowed the IXCs to refile state-law claims. Since then, many of the LECs and IXCs have filed revised pleadings and additional motions, which remain pending. Separately, some of the defendants, including CenturyLink, Inc.'s LECs, have petitioned the FCC to address these issues on an industry-wide basis. As both an IXC and a LEC, we both pay and assess significant amounts of the charges in question. The outcome of these disputes and lawsuits, as well as any related regulatory proceedings that could ensue, are currently not predictable. If we are required to stop assessing these charges or to pay refunds of any such charges, our financial results could be negatively affected. State Tax Suits CenturyLink, Inc. and several of its subsidiaries are defendants in lawsuits filed over the past few years in the Circuit Court of St. Louis County, Missouri by numerous Missouri municipalities alleging underpayment of taxes. These municipalities are seeking, among other things, (i) a declaratory judgment regarding the extent of our obligations to pay certain business license and gross receipts taxes and (ii) a monetary award of back taxes covering 2007 to the present, plus penalties and interest. In a February 2017 ruling in connection with one of these pending cases, the court entered into a final order awarding plaintiffs $4 million and broadening the tax base on a going forward basis. We filed a notice of appeal on March 3, 2017.We expect the outcome of our appeal to reduce our ultimate exposure, although we can provide no assurances to this effect. In a June 9, 2017 ruling in connection with another one of these pending cases, the court made findings which, if not overturned, will result in a tax liability to us well in excess of the contingent liability we have established. Following further proceedings at the district court, we plan to file an appeal and continue to vigorously defend against these claims. For a variety of reasons, we expect the outcome of our appeal to significantly reduce our ultimate exposure, although we can provide no assurances to this effect. Billing Practices Suits In June 2017, a former employee filed an employment lawsuit against us claiming that she was wrongfully terminated for alleging that we charged some of our retail customers for products and services they did not authorize. Starting shortly thereafter and continuing since then, and based in part on the allegations made by the former employee, a series of consumer and shareholder putative class actions were filed against us, and we received several shareholder derivative demands. In July 2017, the Minnesota Attorney General also filed a civil suit on behalf of the Minnesota consumers alleging that we engaged in improper sales and billing practices. The filing of additional related lawsuits is possible. The consumer putative class actions have been transferred to the U.S. District Court for the District of Minnesota for coordinated and consolidated pretrial proceedings. The shareholder putative class actions have been consolidated into a single action that currently is pending in U.S. District Court for the Western District of Louisiana. In addition, a separate, related class action was filed in U.S. District Court for the Southern District of New York purportedly on behalf of persons who purchased certain of our Senior Notes. This class action suit has been transferred to the U.S. District Court for the Western District of Louisiana. In late June 2017, the Board of Directors formed a special committee of outside directors to investigate improper sales and billing practices and related matters. In late 2017, the special committee concluded its review and issued its key findings. Among other things, the committee found that (i) our investment in consumer sales monitoring was insufficient, (ii) our ordering and billing software contributed to customer confusion and (iii) systems and human errors contributed to inaccurate billing. In August 2017, the Board of Directors formed a special litigation committee of outside directors to address the allegations of impropriety contained in the shareholder derivative demands. The investigation of the special litigation committee is ongoing. Pending Litigation Matters Assumed in Level 3 Acquisition Peruvian Tax Litigation Beginning in 2005, one of Level 3’s Peruvian subsidiaries received a number of assessments for tax, penalties and interest for calendar years 2001 and 2002. Peruvian tax authorities ("SUNAT") took the position that the Peruvian subsidiary incorrectly documented its importations resulting in additional income tax withholding and value-added taxes ("VAT"). The total amount of the asserted claims, including potential interest and penalties, was $26 million , consisting of $3 million for income tax withholding in connection with the import of services for calendar years 2001 and 2002, $7 million for VAT in connection with the import of services for calendar years 2001 and 2002, and $16 million in connection with the disallowance of VAT credits for periods beginning in 2005. After taking into account the developments described below, as well as the accrued interest and foreign exchange effects, the total amount of exposure is $15 million at December 31, 2017. Level 3 challenged the 2002 tax period assessments via administrative and then judicial review processes. In October 2011, the highest administrative review tribunal (the Tribunal) decided the central issue underlying the 2002 tax period assessments in the government's favor, while denying a portion of the assessment on procedural grounds. Level 3 then appealed the Tribunal's decision to the judicial court in Peru. After further development of the record, the first judicial level decided the central issue in favor of Level 3. SUNAT and Level 3 filed cross-appeals. In May 2017, the court of appeal issued a decision reversing the first judicial level. In June 2017, Level 3 filed an appeal of the decision to the Supreme Court of Justice, the final judicial level. That appeal is pending. In October 2013, the Tribunal decided the central issue underlying the year 2001 tax period assessments in the government's favor, while denying a portion of the assessment on procedural grounds. Level 3 appealed that decision to the judicial court in Peru. After further development of the record, the first judicial court issued a ruling against Level 3. In June 2017, Level 3 filed an appeal with the court of appeal. An oral hearing took place before the court of appeals on October 18, 2017. In November 2017, the court of appeals issued a decision affirming the lower court’s decision and Level 3 filed an appeal of the decision to the Supreme Court of Justice, the final judicial level. That appeal is pending. In December 2013, SUNAT initiated an audit of calendar year 2001. In June 2014, Level 3 was served with SUNAT’s assessments of the 2001 VAT credits declared null by the Tribunal and the corresponding fine. In July 2014, Level 3 challenged these assessments by filing administrative claims before SUNAT. In January 2015, SUNAT rejected the administrative claims, thereby confirming the assessments. Level 3 filed an appeal with the Tribunal in February 2015. In May 2015, the Tribunal notified Level 3 of its administrative resolution declaring the assessments and corresponding fines null. The time for SUNAT to appeal this resolution has closed. Under local practice, notification of an appeal can take several months. Counsel confirmed in the first quarter of 2016 that SUNAT has not filed an appeal to the resolution. Nevertheless, SUNAT retains the right to reissue the assessments declared null or start a new audit. However, Level 3 is under no obligation to provide additional information and any fine issued by SUNAT based on the same information that it has already used in the past would be declared null. Employee Severance and Contractor Termination Disputes A number of former employees and third-party contractors have asserted a variety of claims in litigation against certain of Level 3’s Latin American subsidiaries for separation pay, severance, commissions, pension benefits, unpaid vacation pay, breach of employment contracts, unpaid performance bonuses, property damages, moral damages and related statutory penalties, fines, costs and expenses (including accrued interest, attorneys' fees and statutorily mandated inflation adjustments) as a result of their separation from Level 3 or termination of service relationships. Level 3 is vigorously defending itself against the asserted claims, which aggregate to approximately $17 million at December 31, 2017. Brazilian Tax Claims In December 2004, March 2009, April 2009 and July 2014, the São Paulo state tax authorities issued tax assessments against one of Level 3’s Brazilian subsidiaries for the Tax on Distribution of Goods and Services (“ICMS”) with respect to revenue from leasing movable properties (in the case of the December 2004, March 2009 and July 2014 assessments) and revenue from the provision of Internet access services (in the case of the April 2009 and July 2014 assessments), by treating such activities as the provision of communications services, to which the ICMS tax applies. In September 2002, July 2009 and May 2012, the Rio de Janeiro state tax authorities issued tax assessments to the same Brazilian subsidiary on similar issues. Level 3 has filed objections to these assessments, arguing that the lease of assets and the provision of Internet access are not communication services subject to ICMS. The objections to the September 2002, December 2004 and March 2009 assessments were rejected by the respective state administrative courts, and Level 3 has appealed those decisions to the judicial courts. In October 2012 and June 2014, Level 3 received favorable rulings from the lower court on the December 2004 and March 2009 assessments regarding equipment leasing, but those rulings are subject to appeal by the state. No ruling has been obtained with respect to the September 2002 assessment. The objections to the April and July 2009 and May 2012 assessments are still pending final administrative decisions. The July 2014 assessment was confirmed during the fourth quarter of 2014 at the first administrative level and Level 3 appealed this decision to the second administrative level. Level 3 is vigorously contesting all such assessments in both states and, in particular, views the assessment of ICMS on revenue from leasing movable properties to be without merit. Nevertheless, Level 3 believes it is reasonably possible that these assessments could result in a loss of up to $53 million at December 31, 2017 in excess of the accruals established for these matters. Other Level 3 Matters Level 3 has recently been notified of a qui tam action pending against Level 3 Communications, Inc., certain former employees and others in the United States District Court for the Eastern District of Virginia, captioned United States of America ex rel., Stephen Bishop v. Level 3 Communications, Inc. et al. The original qui tam complaint was filed under seal on November 26, 2013, and an amended complaint was filed under seal on June 16, 2014. The court unsealed the complaints on October 26, 2017. The amended complaint alleges that Level 3, principally through two former employees, submitted false claims and made false statements to the government in connection with two government contracts. The relator seeks damages in this lawsuit of approximately $50 million , subject to trebling, plus statutory penalties, pre-and-post judgment interest, and attorney’s fees. The case is currently stayed. Level 3 is evaluating its defenses to the claims. At this time, Level 3 does not believe it is probable Level 3 will incur a material loss. If, contrary to its expectations, the plaintiff prevails in this matter and proves damages at or near $50 million , and is successful in having those damages trebled, the outcome could have a material adverse effect on our results of operations in the period in which a liability is recognized and on our cash flows for the period in which any damages are paid. The two former Level 3 employees named in the qui tam amended complaint and others were also indicted in the United States District Court for the Eastern District of Virginia on October 3, 2017, and charged with, among other things, accepting kickbacks from a subcontractor, who was also indicted, for work to be performed under a prime government contract. Level 3 is fully cooperating in the government’s investigations in this matter. Other Proceedings and Disputes From time to time, we are involved in other proceedings incidental to our business, including patent infringement allegations, administrative hearings of state public utility commissions relating primarily to our rates or services, actions relating to employee claims, various tax issues, environmental law issues, grievance hearings before labor regulatory agencies and miscellaneous third party tort actions. We are currently defending several patent infringement lawsuits asserted against us by non-practicing entities, many of which are seeking substantial recoveries. These cases have progressed to various stages and one or more may go to trial in the coming 24 months if they are not otherwise resolved. Where applicable, we are seeking full or partial indemnification from our vendors and suppliers. As with all litigation, we are vigorously defending these actions and, as a matter of course, are prepared to litigate these matters to judgment, as well as to evaluate and consider all reasonable settlement opportunities. We are subject to various foreign, federal, state and local environmental protection and health and safety laws. From time to time, we are subject to judicial and administrative proceedings brought by various governmental authorities under these laws. Several such proceedings are currently pending, but none is reasonably expected to exceed $100,000 in fines and penalties. The outcome of these other proceedings is not predictable. However, based on current circumstances, we do not believe that the ultimate resolution of these other proceedings, after considering available defenses and any insurance coverage or indemnification rights, will have a material adverse effect on our financial position, results of operations or cash flows. Hurricane Damage During the third quarter of 2017, multiple hurricanes struck portions of United States, which caused damage to our facilities and disruption of our services in certain areas of multiple states. We are still in the process of assessing the full extent of the damage. However, based on our current assessment, we estimate that expenditures required for the restoration of our network and physical plant may range from $20 million to $25 million , including repairs and equipment replacement. In addition, Level 3 incurred damage to certain of its facilities from multiple hurricanes, and estimate expenditures required for the restoration of their network and physical plant of $6 million , including repairs and equipment replacement. These damage estimates are subject to many uncertainties and may change materially as we complete physical surveys. The hurricanes did not have a significant impact on our financial condition or results of operations as of and for the year ended December 31, 2017, as the majority of the capital and repair expenditures will be recorded in the future periods as we incur the costs. The ultimate outcome of the above-described matters may differ materially from the outcomes anticipated, estimated, projected or implied by us in certain of our forward-looking statements appearing above in this Note, and proceedings currently viewed as immaterial by us may ultimately materially impact us. For more information, see “Risk Factors—Risks Relating to Legal and Regulatory Matters—Our pending legal proceedings could have a material adverse impact on our financial condition and operating results, on the trading price of our securities and on our ability to access the capital markets” in Item 1A of Part II of this report. Environmental Contingencies In connection with our largely historical operations, we have responded to or been notified of potential environmental liability at approximately 200 properties. We are engaged in addressing or have liquidated environmental liabilities at many of those properties. We could potentially be held liable, jointly, or severally, and without regard to fault, for the costs of investigation and remediation of these sites. The discovery of additional environmental liabilities or changes in existing environmental requirements could have a material adverse effect on our business. Capital Leases We lease certain facilities and equipment under various capital lease arrangements. Depreciation of assets under capital leases is included in depreciation and amortization expense in our consolidated statements of operations. Payments on capital leases are included in repayments of long-term debt, including current maturities in our consolidated statements of cash flows. The tables below summarize our capital lease activity: Years Ended December 31, 2017 2016 2015 (Dollars in millions) Assets acquired through capital leases $ 35 45 17 Depreciation expense 50 70 96 Cash payments towards capital leases 48 58 89 As of December 31, 2017 2016 (Dollars in millions) Assets included in property, plant and equipment $ 342 705 Accumulated depreciation 153 351 The future annual minimum payments under capital lease arrangements as of December 31, 2017 were as follows: Future Minimum Payments (1) (Dollars in millions) Capital lease obligations: 2018 $ 56 2019 45 2020 32 2021 25 2022 22 2023 and thereafter 203 Total minimum payments 383 Less: amount representing interest and executory costs (117 ) Present value of minimum payments 266 Less: current portion (40 ) Long-term portion $ 226 Operating Leases CenturyLink leases various equipment, office facilities, retail outlets, switching facilities and other network sites. These leases, with few exceptions, provide for renewal options and escalations that are either fixed or based on the consumer price index. Any rent abatements, along with rent escalations, are included in the computation of rent expense calculated on a straight-line basis over the lease term. The lease term for most leases includes the initial non-cancelable term plus any term under renewal options that are reasonably assured. For the years ended December 31, 2017 , 2016 and 2015 , our gross rental expense was $550 million , $482 million and $467 million , respectively. We also received sublease rental income for the years ended December 31, 2017 , 2016 and 2015 of $13 million , $12 million and $12 million , respectively. At December 31, 2017 , our future rental commitments for operating leases were as follows: Future Minimum Payments (Dollars in millions) 2018 $ 666 2019 533 2020 467 2021 367 2022 326 2023 and thereafter 2,116 Total future minimum payments (1) $ 4,475 _______________________________________________________________________________ (1) Minimum payments have not been reduced by minimum sublease rentals of $92 million due in the future under non-cancelable subleases. Purchase Commitments We have several commitments primarily for marketing activities and support services from a variety of vendors to be used in the ordinary course of business totaling $953 million at December 31, 2017 . Of this amount, we expect to purchase $343 million in 2018 , $265 million in 2019 through 2020 , $103 million in 2021 through 2022 and $242 million in 2023 and thereafter . These amounts do not represent our entire anticipated purchases in the future, but represent only those items for which we were contractually committed as of December 31, 2017 . |
Other Financial Information
Other Financial Information | 12 Months Ended |
Dec. 31, 2017 | |
Additional Financial Information Disclosure [Abstract] | |
Other financial information | Other Financial Information Assets Held for Sale Assets held for sale includes several assets that we expect to sell within the next twelve months. On January 22, 2018, we entered into an agreement to sell a block of Internet Protocol Addresses for aggregate consideration of $68 million , which is to be paid in two equal installments. In addition, the U.S. Department of Justice ("DOJ") approved our acquisition of Level 3 subject to conditions of a consent decree on October 2, 2017, which requires the combined company to divest certain Level 3 metro network assets in the markets located in Albuquerque, New Mexico; Boise, Idaho; and Tucson, Arizona and to divest dark fiber connecting 30 specified city-pairs across the United States in the form of an Indefeasible Right of Use agreement. As of the date of this report, we have signed two letters of intent that the DOJ is reviewing. Other Current Assets The following table presents details of other current assets in our consolidated balance sheets: As of December 31, 2017 2016 (Dollars in millions) Prepaid expenses $ 294 206 Income tax receivable 258 51 Materials, supplies and inventory 128 134 Deferred activation and installation charges 128 101 Other 133 55 Total other current assets $ 941 547 Selected Current Liabilities Current liabilities reflected in our consolidated balance sheets include accounts payable and other current liabilities as follows: As of December 31, 2017 2016 (Dollars in millions) Accounts payable $ 1,555 1,179 Other current liabilities: Accrued rent $ 34 31 Legal contingencies 45 30 Other 265 152 Total other current liabilities $ 344 213 Included in accounts payable at December 31, 2017 and 2016 , were (i) $36 million and $56 million , respectively, representing book overdrafts and (ii) $225 million and $196 million , respectively, associated with capital expenditures. |
Labor Union Contracts
Labor Union Contracts | 12 Months Ended |
Dec. 31, 2017 | |
Labor Union Contracts | |
Concentration Risk Disclosure | Labor Union Contracts As of December 31, 2017, approximately 28% of our employees were members of various bargaining units represented by the Communication Workers of America ("CWA") and the International Brotherhood of Electrical Workers ("IBEW"). We believe that relations with our employees continue to be generally good. Less than 1,000 of our employees were subject to collective bargaining agreements that expired in 2017 and, as of December 31, 2017, were being renegotiated. In mid-2017, we reached new agreements with the CWA District 7 and IBEW Local 206, which represented at December 31, 2017 approximately 10,000 , or 71% , of our represented employees. The new agreements were effective June 18, 2017 and will expire on March 8, 2020 and include terms substantially similar to those contained in the prior agreements. Approximately 1,000 of our employees are subject to collective bargaining agreements that are scheduled to expire in 2018. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 12 Months Ended |
Dec. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Other Comprehensive Earnings | Accumulated Other Comprehensive Loss Information Relating to 2017 The table below summarizes changes in accumulated other comprehensive loss recorded on our consolidated balance sheet by component for the year ended December 31, 2017 : Pension Plans Post-Retirement Benefit Plans Foreign Currency Translation Adjustment and Other Total (Dollars in millions) Balance at December 31, 2016 $ (1,895 ) (162 ) (60 ) (2,117 ) Other comprehensive income (loss) before reclassifications 39 (86 ) 31 (16 ) Amounts reclassified from accumulated other comprehensive income 125 13 — 138 Net current-period other comprehensive income (loss) 164 (73 ) 31 122 Balance at December 31, 2017 $ (1,731 ) (235 ) (29 ) (1,995 ) The table below presents further information about our reclassifications out of accumulated other comprehensive loss by component for the year ended December 31, 2017 : Year Ended December 31, 2017 Decrease (Increase) in Net Income Affected Line Item in Consolidated Statement of Operations (Dollars in millions) Amortization of pension & post-retirement plans (1) Net actuarial loss $ 205 Other income (expense), net Prior service cost 12 Other income (expense), net Total before tax 217 Income tax benefit (79 ) Income tax expense Net of tax $ 138 ________________________________________________________________________ (1) See Note 9—Employee Benefits for additional information on our net periodic benefit (expense) income related to our pension and post-retirement plans. Information Relating to 2016 The table below summarizes changes in accumulated other comprehensive loss recorded on our consolidated balance sheet by component for the year ended December 31, 2016 : Pension Plans Post-Retirement Benefit Plans Foreign Currency Translation Adjustment and Other Total (Dollars in millions) Balance at December 31, 2015 $ (1,715 ) (180 ) (39 ) (1,934 ) Other comprehensive income (loss) before reclassifications (280 ) 6 (22 ) (296 ) Amounts reclassified from accumulated other comprehensive income 100 12 1 113 Net current-period other comprehensive income (loss) (180 ) 18 (21 ) (183 ) Balance at December 31, 2016 $ (1,895 ) (162 ) (60 ) (2,117 ) The table below presents further information about our reclassifications out of accumulated other comprehensive loss by component for the year ended December 31, 2016 : Year Ended December 31, 2016 Decrease (Increase) in Net Loss Affected Line Item in Consolidated Statement of Operations (Dollars in millions) Amortization of pension & post-retirement plans (1) Net actuarial loss $ 175 Other income (expense), net Prior service cost 12 Other income (expense), net Total before tax 187 Income tax benefit (75 ) Income tax expense Insignificant items $ 1 Net of tax $ 113 ________________________________________________________________________ (1) See Note 9—Employee Benefits for additional information on our net periodic benefit (expense) income related to our pension and post-retirement plans. |
Dividends
Dividends | 12 Months Ended |
Dec. 31, 2017 | |
Dividends, Common Stock [Abstract] | |
Dividends | Dividends Our Board of Directors declared the following dividends payable in 2017 and 2016 : Date Declared Record Date Dividend Per Share Total Amount Payment Date (in millions) November 14, 2017 11/27/2017 $ 0.540 $ 577 12/11/2017 August 22, 2017 9/5/2017 0.540 296 9/15/2017 May 24, 2017 6/5/2017 0.540 297 6/16/2017 February 21, 2017 3/3/2017 0.540 295 3/17/2017 November 15, 2016 11/28/2016 0.540 294 12/12/2016 August 23, 2016 9/2/2016 0.540 295 9/16/2016 May 18, 2016 5/31/2016 0.540 294 6/14/2016 February 23, 2016 3/4/2016 0.540 295 3/18/2016 The declaration of dividends is solely at the discretion of our Board of Directors, which may change or terminate our dividend practice at any time for any reason without prior notice. On February 21, 2018 , our Board of Directors declared a dividend of $0.54 per share. |
Basis of Presentation and Sum30
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
General and Basis of Presentation | General We are an international facilities-based communications company engaged primarily in providing an integrated array of services to our residential and business customers. Our communications services include local and long-distance voice, virtual private network ("VPN") data network, private line (including business data services), Ethernet, information technology, wavelength, broadband, colocation and data center services, managed services, professional and other services provided in connection with selling equipment, network security and various other ancillary services. On November 1, 2017, we acquired Level 3 Communications, Inc. ("Level 3") in a cash and stock transaction. See Note 2—Acquisition of Level 3 for additional information. On May 1, 2017, we sold our data centers and colocation business to a consortium led by BC Partners, Inc. and Medina Capital for a combination of cash and equity. See Note 3—Sale of Data Centers and Colocation Business for additional information. Basis of Presentation The accompanying consolidated financial statements include our accounts and the accounts of our subsidiaries. These subsidiaries include Level 3 on and after November 1, 2017. Intercompany amounts and transactions with our consolidated subsidiaries have been eliminated. In connection with our acquisition of Level 3, we acquired its deconsolidated Venezuela subsidiary and due to exchange restrictions and other conditions we have assigned no value to the assets acquired. Additionally, we have excluded this subsidiary from our consolidated financial statements. To simplify the overall presentation of our consolidated financial statements, we report immaterial amounts attributable to noncontrolling interests in certain of our subsidiaries as follows: (i) income attributable to noncontrolling interests in other income (expense), net, (ii) equity attributable to noncontrolling interests in additional paid-in capital and (iii) cash flows attributable to noncontrolling interests in other, net financing activities. We reclassified certain prior period amounts to conform to the current period presentation, including the categorization of our revenues and our segment reporting for 2016 and 2015. See Note 14—Segment Information for additional information. These changes had no impact on total operating revenues, total operating expenses or net income for any period. |
Consolidation | The accompanying consolidated financial statements include our accounts and the accounts of our subsidiaries. These subsidiaries include Level 3 on and after November 1, 2017. Intercompany amounts and transactions with our consolidated subsidiaries have been eliminated. In connection with our acquisition of Level 3, we acquired its deconsolidated Venezuela subsidiary and due to exchange restrictions and other conditions we have assigned no value to the assets acquired. Additionally, we have excluded this subsidiary from our consolidated financial statements. To simplify the overall presentation of our consolidated financial statements, we report immaterial amounts attributable to noncontrolling interests in certain of our subsidiaries as follows: (i) income attributable to noncontrolling interests in other income (expense), net, (ii) equity attributable to noncontrolling interests in additional paid-in capital and (iii) cash flows attributable to noncontrolling interests in other, net financing activities. |
Reclassification | We reclassified certain prior period amounts to conform to the current period presentation, including the categorization of our revenues and our segment reporting for 2016 and 2015. See Note 14—Segment Information for additional information. These changes had no impact on total operating revenues, total operating expenses or net income for any period. |
Net Periodic Benefit Expense, Estimating Service and Interest Components | Changes in Estimates In 2016, we changed the method we use to estimate the service and interest components of net periodic benefit expense for pension and other postretirement benefit obligations. This change resulted in a decrease in the service and interest components in 2017 and 2016. Beginning in 2016, we utilized a full yield curve approach in connection with estimating these components by applying the specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows, as opposed to the single weighted-average discount rate derived from the yield curve that we have used in the past. We believe this change more precisely measures service and interest costs by improving the correlation between projected benefit cash flows to the corresponding spot yield curve rates. This change did not affect the measurement of our total benefit obligations but lowered our annual net periodic benefit cost by $122 million and $149 million in 2017 and 2016, respectively. This change was treated as a change in accounting estimate and accordingly, we did not adjust the amounts recorded in 2015. The reduction in expense described above, net of tax, increased net income by $75 million and $91 million , or $0.12 and $0.17 per basic and diluted common share, for the years ended December 31, 2017 and 2016, respectively. |
Use of Estimates | Use of Estimates Our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles. These accounting principles require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions we make when accounting for specific items and matters, including, but not limited to, investments, long-term contracts, customer retention patterns, allowance for doubtful accounts, depreciation, amortization, asset valuations, internal labor capitalization rates, recoverability of assets (including deferred tax assets), impairment assessments, pension, post-retirement and other post-employment benefits, taxes, certain liabilities and other provisions and contingencies, are reasonable, based on information available at the time they are made. These estimates, judgments and assumptions can materially affect the reported amounts of assets, liabilities and components of stockholders' equity as of the dates of the consolidated balance sheets, as well as the reported amounts of revenues, expenses and components of cash flows during the periods presented in our other consolidated financial statements. We also make estimates in our assessments of potential losses in relation to threatened or pending tax and legal matters. See Note 13—Income Taxes and Note 16—Commitments and Contingencies for additional information. For matters not related to income taxes, if a loss is considered probable and the amount can be reasonably estimated, we recognize an expense for the estimated loss. If we have the potential to recover a portion of the estimated loss from a third party, we make a separate assessment of recoverability and reduce the estimated loss if recovery is also deemed probable. For matters related to income taxes, if we determine that the impact of an uncertain tax position is more likely than not to be sustained upon audit by the relevant taxing authority, then we recognize a benefit for the largest amount that is more likely than not to be sustained. No portion of an uncertain tax position will be recognized if the position has less than a 50% likelihood of being sustained. Interest is recognized on the amount of unrecognized benefit from uncertain tax positions. For all of these and other matters, actual results could differ materially from our estimates. |
Revenue Recognition | Revenue Recognition We recognize revenue for services when the related services are provided. Recognition of certain payments received in advance of services being provided is deferred until the service is provided. These advance payments include activation and installation charges, which we recognize as revenue over the expected customer relationship period, which ranges from three years to over seven years depending on the service. We also defer costs for customer activations and installations. The deferral of customer activation and installation costs is limited to the amount of revenue deferred on advance payments. Costs in excess of advance payments are recorded as expense in the period such costs are incurred. Expected customer relationship periods are estimated using historical experience. In most cases, termination fees or other fees on existing contracts that are negotiated in conjunction with new contracts are deferred and recognized over the new contract term. We offer bundle discounts to our customers who receive certain groupings of services. These bundle discounts are recognized concurrently with the associated revenue and are allocated to the various services in the bundled offering based on the estimated selling price of services included in each bundled combination. Customer arrangements that include both equipment and services are evaluated to determine whether the elements are separable. If the elements are deemed separable and separate earnings processes exist, the revenue associated with the customer arrangement is allocated to each element based on the relative estimated selling price of the separate elements. We have estimated the selling prices of each element by reference to vendor-specific objective evidence of selling prices when the elements are sold separately. The revenue associated with each element is then recognized as earned. For example, if we receive an advance payment when we sell equipment and continuing service together, we immediately recognize as revenue the amount allocated to the equipment as long as all the conditions for revenue recognition have been satisfied. The portion of the advance payment allocated to the service based upon its relative selling price is recognized ratably over the longer of the contractual period or the expected customer relationship period. We periodically transfer optical capacity assets on our network to other telecommunications service carriers. These transactions are structured as indefeasible rights of use, commonly referred to as IRUs, which are the exclusive right to use a specified amount of capacity or fiber for a specified term, typically 20 years. We account for the cash consideration received on transfers of optical capacity assets and on all of the other elements deliverable under an IRU, as revenue ratably over the term of the agreement. We do not recognize revenue on any contemporaneous exchanges of our optical capacity assets for other optical capacity assets. In connection with offering products and services provided by third-party vendors, we review the relationship between us, the vendor and the end customer to assess whether revenue should be reported on a gross or net basis. In assessing whether revenue should be reported on a gross or net basis, we consider whether we act as a principal in the transaction, take title to the products, have risk and rewards of ownership or act as an agent or broker. We have service level commitments pursuant to contracts with certain of our customers. To the extent that such service levels are not achieved or are otherwise disputed due to performance or service issues or other service interruptions or conditions, we will estimate the amount of credits to be issued and record a reduction to revenues, with a corresponding increase in the credit reserve. |
USF Surcharges, Gross Receipts Taxes and Other Surcharges | USF Surcharges, Gross Receipts Taxes and Other Surcharges In determining whether to include in our revenues and expenses the taxes and surcharges collected from customers and remitted to government authorities, including USF surcharges, sales, use, value added and some excise taxes, we assess, among other things, whether we are the primary obligor or principal taxpayer for the taxes assessed in each jurisdiction where we do business. In jurisdictions where we determine that we are the principal taxpayer, we record the surcharges on a gross basis and include them in our revenues and costs of services and products. In jurisdictions where we determine that we are merely a collection agent for the government authority, we record the taxes on a net basis and do not include them in our revenues and costs of services and products. |
Advertising Costs | Advertising Costs Costs related to advertising are expensed as incurred and included in selling, general and administrative expenses in our consolidated statements of operations. Our advertising expense was $218 million , $216 million and $210 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. |
Legal Costs | Legal Costs In the normal course of our business, we incur costs to hire and retain external legal counsel to advise us on regulatory, litigation and other matters. We expense these costs as the related services are received. |
Income Taxes | Income Taxes We file a consolidated federal income tax return with our eligible subsidiaries. The provision for income taxes consists of an amount for taxes currently payable, an amount for tax consequences deferred to future periods and adjustments to our liabilities for uncertain tax positions. We record deferred income tax assets and liabilities reflecting future tax consequences attributable to tax net operating loss carryforwards ("NOLs"), tax credit carryforwards and differences between the financial statement carrying value of assets and liabilities and the tax bases of those assets and liabilities. Deferred taxes are computed using enacted tax rates expected to apply in the year in which the differences are expected to affect taxable income. The effect on deferred income tax assets and liabilities of a change in tax rate is recognized in earnings in the period that includes the enactment date. We establish valuation allowances when necessary to reduce deferred income tax assets to the amounts that we believe are more likely than not to be recovered. Each quarter we evaluate the need to retain all or a portion of the valuation allowance on our deferred tax assets. See Note 13—Income Taxes for additional information. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include highly liquid investments that are readily convertible into cash and are not subject to significant risk from fluctuations in interest rates. As a result, the value at which cash and cash equivalents are reported in our consolidated financial statements approximates their fair value. In evaluating investments for classification as cash equivalents, we require that individual securities have original maturities of ninety days or less and that individual investment funds have dollar-weighted average maturities of ninety days or less. To preserve capital and maintain liquidity, we invest with financial institutions we deem to be of sound financial condition and in high quality and relatively risk-free investment products. Our cash investment policy limits the concentration of investments with specific financial institutions or among certain products and includes criteria related to credit worthiness of any particular financial institution. Book overdrafts occur when checks have been issued but have not been presented to our controlled disbursement bank accounts for payment. Disbursement bank accounts allow us to delay funding of issued checks until the checks are presented for payment. Until the issued checks are presented for payment, the book overdrafts are included in accounts payable on our consolidated balance sheet. This activity is included in the operating activities section in our consolidated statements of cash flows. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts We record accounts receivable acquired in connection with our acquisitions based on their estimated fair value as of the applicable acquisition date. Accounts receivable are recognized based upon the amount due from customers for the services provided or at cost for purchased and other receivables less an allowance for doubtful accounts. The allowance for doubtful accounts receivable reflects our best estimate of probable losses inherent in our receivable portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other currently available evidence. We generally consider our accounts past due if they are outstanding over 30 days . Our collection process varies by the customer segment, amount of the receivable, and our evaluation of the customer's credit risk. Our past due accounts are written off against our allowance for doubtful accounts when collection is considered to be not probable. Any recoveries of accounts previously written off are generally recognized as a reduction in bad debt expense in the period received. The carrying value of accounts receivable net of the allowance for doubtful accounts approximates fair value. |
Property, Plant and Equipment | Property, Plant and Equipment We record property, plant and equipment acquired in connection with our acquisitions based on its estimated fair value as of its acquisition date plus the estimated value of any associated legally or contractually required retirement obligations. We record purchased and constructed property, plant and equipment at cost, plus the estimated value of any associated legally or contractually required retirement obligations. The majority of our property, plant and equipment is depreciated using the straight-line group method, but certain of our assets are depreciated using the straight-line method over their estimated useful lives. Under the straight-line group method, assets dedicated to providing telecommunications services (which comprise the majority of our property, plant and equipment) that have similar physical characteristics, use and expected useful lives are pooled for purposes of depreciation and tracking. The equal life group procedure is used to establish each pool's average remaining useful life. Generally, under the straight-line group method, when an asset is sold or retired in the course of normal business activities, the cost is deducted from property, plant and equipment and charged to accumulated depreciation without recognition of a gain or loss. A gain or loss is recognized in our consolidated statements of operations only if a disposal is unusual. Leasehold improvements are amortized over the shorter of the useful lives of the assets or the expected lease term. Expenditures for maintenance and repairs are expensed as incurred. Interest is capitalized during the construction phase of network and other internal-use capital projects. Employee-related costs for construction of network and other internal use assets are also capitalized during the construction phase. Property, plant and equipment supplies used internally are carried at average cost, except for significant individual items for which cost is based on specific identification. We perform annual internal reviews to evaluate the reasonableness of the depreciable lives for our property, plant and equipment. Our reviews utilize models that take into account actual usage, physical wear and tear, replacement history, assumptions about technology evolution and, in certain instances, actuarially determined probabilities to estimate the remaining useful life of our asset base. Our remaining useful life assessments anticipate the loss in service value of assets that may precede the physical retirement. Assets shared among many customers may lose service value as those customers leave the network. However, the asset is not retired until all customers no longer utilize the asset and we determine there is no alternative use for the asset. We have asset retirement obligations associated with the legally or contractually required removal of a limited group of property, plant and equipment assets from leased properties and the disposal of certain hazardous materials present in our owned properties. When an asset retirement obligation is identified, usually in association with the acquisition of the asset, we record the fair value of the obligation as a liability. The fair value of the obligation is also capitalized as property, plant and equipment and then amortized over the estimated remaining useful life of the associated asset. Where the removal obligation is not legally binding, the net cost to remove assets is expensed in the period in which the costs are actually incurred. We review long-lived tangible assets for impairment whenever facts and circumstances indicate that the carrying amounts of the assets may not be recoverable. For assessment purposes, long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities, absent a material change in operations. An impairment loss is recognized only if the carrying amount of the asset group is not recoverable and exceeds its fair value. Recoverability of the asset group to be held and used is assessed by comparing the carrying amount of the asset group to the estimated undiscounted future net cash flows expected to be generated by the asset group. If the asset group's carrying value is not recoverable, an impairment charge is recognized for the amount by which the carrying amount of the asset group exceeds its fair value. We determine fair values by using a combination of comparable market values and discounted cash flows, as appropriate. |
Goodwill, Customer Relationships and Other Intangible Assets | Goodwill, Customer Relationships and Other Intangible Assets Intangible assets arising from business combinations, such as goodwill, customer relationships, capitalized software, trademarks and trade names, are initially recorded at estimated fair value. We amortize customer relationships primarily over an estimated life of 7 to 15 years , using either the sum-of-the-years-digits or the straight-line methods, depending on the type of customer. We amortize capitalized software using the straight-line method over estimated lives ranging up to 7 years , except for approximately $237 million of our capitalized software costs, which represents costs to develop an integrated billing and customer care system which is amortized using the straight-line method over a 20 year period. We amortize our other intangible assets predominantly using the sum-of-the-years-digits method over an estimated life of 4 to 20 years. Other intangible assets not arising from business combinations are initially recorded at cost. Where there are no legal, regulatory, contractual or other factors that would reasonably limit the useful life of an intangible asset, we classify the intangible asset as indefinite-lived and such intangible assets are not amortized. Internally used software, whether purchased or developed by us, is capitalized and amortized using the straight-line method over its estimated useful life. We have capitalized certain costs associated with software such as costs of employees devoting time to the projects and external direct costs for materials and services. Costs associated with software to be used for internal purposes are expensed until the point at which the project has reached the development stage. Subsequent additions, modifications or upgrades to internal-use software are capitalized only to the extent that they allow the software to perform a task it previously did not perform. Software maintenance, data conversion and training costs are expensed in the period in which they are incurred. We review the remaining economic lives of our capitalized software annually. Capitalized software is included in other intangible assets, net, in our consolidated balance sheets. Our long-lived intangible assets, other than goodwill, with indefinite lives are assessed for impairment annually, or, under certain circumstances, more frequently, such as when events or changes in circumstances indicate there may be an impairment. These assets are carried at the estimated fair value at the time of acquisition and assets not acquired in acquisitions are recorded at historical cost. However, if their estimated fair value is less than the carrying amount, other indefinite-lived intangible assets are reduced to their estimated fair value through an impairment charge to our consolidated statements of operations. We are required to assess goodwill for impairment at least annually, or more frequently, if an event occurs or circumstances change that would indicate an impairment may have occurred. We are required to write-down the value of goodwill in periods in which the recorded amount of goodwill exceeds the implied fair value of goodwill. Our reporting units are not discrete legal entities with discrete financial statements. Therefore, the equity carrying value and future cash flows must be estimated each time a goodwill impairment assessment is performed on a reporting unit. As a result, our assets, liabilities and cash flows are assigned to reporting units using reasonable and consistent allocation methodologies. Certain estimates, judgments and assumptions are required to perform these assignments. We believe these estimates, judgments and assumptions to be reasonable, but changes in any of these can significantly affect each reporting unit's equity carrying value and future cash flows utilized for our goodwill impairment assessment. We are required to reassign goodwill to reporting units each time we reorganize our internal reporting structure which causes a change in the composition of our reporting units. Goodwill is reassigned to the reporting units using a relative fair value approach. We utilize the earnings before interest, taxes, depreciation and amortization of each reporting unit as our allocation methodology as it represents a reasonable proxy for the fair value of the operations being reorganized. See Note 4—Goodwill, Customer Relationships and Other Intangible Assets for additional information. |
Pension and Post-Retirement Benefits | Pension and Post-Retirement Benefits We recognize the funded status of our defined benefit and post-retirement plans as an asset or a liability on our consolidated balance sheet. Each year's actuarial gains or losses are a component of our other comprehensive income (loss), which is then included in our accumulated other comprehensive loss. Pension and post-retirement benefit expenses are recognized over the period in which the employee renders service and becomes eligible to receive benefits. We make significant assumptions (including the discount rate, expected rate of return on plan assets, mortality and health care trend rates) in computing the pension and post-retirement benefits expense and obligations. See Note 9—Employee Benefits for additional information. |
Foreign Currency | Foreign Currency Our results of operations include foreign subsidiaries, which are translated from the applicable functional currency to the United States Dollar using the average exchange rates during the reporting period, while assets and liabilities are translated at the reporting date. We include gains or losses from foreign currency re-measurement in other income, net in our consolidated statements of operations. Certain non-U.S. subsidiaries designate the local currency as their functional currency, and we record the translation of their assets and liabilities into U.S. dollars at the balance sheet date as translation adjustments and include them as a component of accumulated other comprehensive loss in our consolidated balance sheets. We consider the majority of our investments in our foreign subsidiaries to be long-term in nature. |
Common Stock, Preferred Stock and Dividends | Common Stock At December 31, 2017 , we had 4 million unissued shares of CenturyLink, Inc. common stock reserved for acquisitions. In addition, we had 45 million shares authorized for future issuance under our equity incentive plans. Preferred stock Holders of outstanding CenturyLink, Inc. preferred stock are entitled to receive cumulative dividends, receive preferential distributions equal to $25 per share plus unpaid dividends upon CenturyLink, Inc.'s liquidation and vote as a single class with the holders of common stock. Dividends We pay dividends out of retained earnings to the extent we have retained earnings on the date the dividend is declared. If the dividend is in excess of our retained earnings on the declaration date, then the excess is drawn from our additional paid-in capital. |
Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements In 2017, we adopted Accounting Standards Update ("ASU") 2016-18, "Restricted Cash (a consensus of the Financial Accounting Standards Board ("FASB") Emerging Issues Task Force)" ("ASU 2016-18"). In the first quarter of 2017, we adopted ASU 2016-09, “Improvements to Employee Share Based Compensation” (“ASU 2016-09”) and ASU 2017-07, “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost” (“ASU 2017-07”). Each of these is described further below. Restricted Cash On November 17, 2016, the FASB issued ASU 2016-18, which requires that a statement of cash flows explain the change in the total of cash, cash equivalents and amounts generally described as restricted cash and restricted cash equivalents as compared to the previous presentation, which explains only the change in cash and cash equivalents. ASU 2016-18 is effective January 1, 2018, but early adoption is permitted and requires retrospective application of the requirements to all previous periods presented. We early adopted ASU 2016-18 in the second quarter of 2017. Share-based Compensation ASU 2016-09 modified the accounting and associated income tax accounting for share-based compensation in order to reduce the cost and complexity associated with previous U.S. generally accepted accounting principles (“GAAP”). The primary provisions of ASU 2016-09 that affect our consolidated financial statements for the year ended December 31, 2017 are: 1. A reclassification of the income tax effect associated with the difference between the expense recognized for share-based payments and the related tax deduction from additional paid-in capital to income tax expense. This change was applied on a prospective basis and resulted in a $5 million increase in income tax expense for the year ended December 31, 2017. 2. We elected to change our accounting policy to account for forfeitures of share-based payment grants as they occur as opposed to our previous policy of estimating the forfeitures on the grant date. The cumulative effect of adopting this policy as of January 1, 2017 resulted in an increase of $3 million , net of a $2 million tax effect, in accumulated deficit. Net Periodic Pension and Postretirement Benefit Costs ASU 2017-07 modified the presentation of net periodic pension and postretirement benefit costs and requires the service cost component to be reported separately from the other components in order to provide more useful information. Under ASU 2017-07, the service cost component of net periodic pension and postretirement benefit costs is required to be presented in the same expense category as the related salary and wages for the employee. The other components of the net periodic pension and postretirement benefit costs are required to be recognized below operating income in other income (expense), net in our consolidated statements of operations. This change was applied on a retrospective basis to all previous periods to match the current period presentation. This retrospective application resulted in a $2 million increase in operating income and a corresponding increase in total other expense, net for the year ended December 31, 2016 and a $26 million reduction in operating income and a corresponding decrease in total other expense, net for the year ended December 31, 2015 . Recent Accounting Pronouncements Comprehensive Income On February 14, 2018, the FASB issued ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” (“ASU 2018-02”). Under current accounting guidance, the income tax effects for changes in income tax rates and certain other transactions are recognized in income from continuing operations resulting in income tax effects recognized in accumulated other comprehensive income that don’t reflect the current tax rate of the entity (“stranded tax effects”). ASU 2018-02 allows us the option to reclassify these stranded tax effects related to the change in the federal income tax rate as a result of the Tax Cuts and Jobs Act to retained earnings. We currently plan to adopt the provisions of ASU 2018-02 in the first quarter of 2018 and elect to reclassify the stranded tax effects related to the Tax Cuts and Job Act from accumulated comprehensive income to retained earnings in first quarter of 2018. We currently estimate that our retained earnings and accumulated other comprehensive loss will increase by approximately $400 million as a result of the adoption of ASU 2018-02. Goodwill Impairment On January 26, 2017, the FASB issued ASU 2017-04, “Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”). ASU 2017-04 simplifies the impairment testing for goodwill by changing the measurement for goodwill impairment. Under current rules, we are required to compute the implied fair value of goodwill to measure the impairment amount if the carrying value of a reporting unit exceeds its fair value. Under ASU 2017-04, the goodwill impairment charge will equal the excess of the reporting unit carrying value above fair value, limited to the amount of goodwill assigned to the reporting unit. We are required to adopt the provisions of ASU 2017-04 for any goodwill impairment tests, including our required annual test, occurring after January 1, 2020, but have the option to early adopt for any impairment test that we are required to perform. We have not determined if we will elect to early adopt the provisions of ASU 2017-04. The provisions of ASU 2017-04 would not have affected our last goodwill impairment assessment, but no assurance can be provided that the simplified testing methodology will not affect our goodwill impairment assessment in the future. Income Taxes On October 24, 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-16, “Intra-Entity Transfers of Assets Other Than Inventory” ("ASU 2016-16"). ASU 2016-16 eliminates the current prohibition on the recognition of the income tax effects on the transfer of assets among our subsidiaries. After adoption of this ASU, the income tax effects associated with these asset transfers, except for the transfer of inventory, will be recognized in the period the asset is transferred versus the current deferral and recognition upon either the sale of the asset to a third party or over the remaining useful life of the asset. We plan to adopt the provisions of ASU 2016-16 on January 1, 2018. The adoption of ASU 2016-16 is not expected to have a material impact to our consolidated financial statements. Financial Instruments On June 16, 2016, the FASB issued ASU 2016-13, "Measurement of Credit Losses on Financial Instruments" ("ASU 2016-13"). The primary impact of ASU 2016-13 for us is a change in the model for the recognition of credit losses related to our financial instruments from an incurred loss model, which recognized credit losses only if it was probable that a loss had been incurred, to an expected loss model, which requires our management team to estimate the total credit losses expected on the portfolio of financial instruments. We are currently reviewing the requirements of the standard and evaluating the impact on our consolidated financial statements. We are required to adopt the provisions of ASU 2016-13 effective January 1, 2020, but could elect to early adopt the provisions as of January 1, 2019. We expect to recognize the impacts of adopting ASU 2016-13 through a cumulative adjustment to (accumulated deficit) retained earnings as of the date of adoption. As of the date of this report, we have not yet determined the date we will adopt ASU 2016-13. Leases On February 25, 2016, the FASB issued ASU 2016-02, “Leases” (“ASU 2016-02”). The core principle of ASU 2016-02 will require lessees to present right-of-use assets and lease liabilities on their balance sheets for operating leases, which are currently not reflected on their balance sheets. ASU 2016-02 is effective for annual and interim periods beginning January 1, 2019. Early adoption of ASU 2016-02 is permitted. Upon adoption of ASU 2016-02, we are required to recognize and measure leases at the beginning of the earliest period presented in our consolidated financial statements using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients that we may elect to apply. We have completed our initial assessment of our business and system requirements and we are currently developing and implementing a new lease accounting and administrative system to comply with the requirements of ASU 2016-02. We plan to adopt the standard when it becomes effective for us beginning January 1, 2019 and the adoption of the standard will result in the recognition of right of use assets and lease liabilities that have not previously been recorded. Although we believe it is premature as of the date of this report to provide any estimate of the impact of adopting ASU 2016-02, we do expect that it will have a material impact on our consolidated financial statements. Additionally, upon the January 1, 2019, implementation of ASU 2016-02, accounting for the failed-sale-leaseback transaction described in Note 3 — Sale of Data Centers and Colocation Business will no longer be applicable based on our facts and circumstances, and the real estate assets and corresponding financing obligation will be derecognized from our consolidated balance sheet. Revenue Recognition On May 28, 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”). ASU 2014-09 replaces virtually all existing generally accepted accounting principles (“GAAP”) on revenue recognition and replaces them with a principles-based approach for determining revenue recognition using a new five step model. The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 also includes new accounting principles related to the deferral and amortization of contract acquisition and fulfillment costs. On July 9, 2015, the FASB approved the deferral of the effective date of ASU 2014-09 by one year until January 1, 2018, which is the date we plan to adopt this standard. ASU 2014-09 may be adopted by applying the provisions of this standard on a retrospective basis to the periods included in the financial statements or on a modified retrospective basis which would result in the recognition of a cumulative effect of adopting ASU 2014-09 in the first quarter of 2018. We adopted the new revenue recognition standard under the modified retrospective transition method. The most significant judgments and impacts upon adoption of the standard include the following items: Upon adoption, we will defer (i.e. capitalize) incremental contract acquisition costs and recognize (i.e. amortize) them over the term of the initial contract and anticipated renewal contracts to which the costs relate. Our deferred contract costs for our business and consumer customers have average amortization periods of approximately 49 months and 30 months, respectively, and are subject to being monitored every period to reflect any significant change in assumptions. In addition, we will assess our deferred contract cost asset for impairment on a periodic basis. Promotional bill credits, discounts and prepaid cards offered to customers as part of renewing services or entering into a new services arrangement that are paid over time and are contingent on the customer maintaining a service contract results in an extended service contract term with multiple performance obligations, which impacts the allocation and timing of revenue recognition between service revenue and revenue assigned to the customer credits. A contract asset will be recorded when services are delivered to the customer, and subsequently recognized as a reduction to service revenue over the extended contract term. We are in the process of implementing a new revenue accounting system, as well as, new processes and internal controls over revenue recognition to assist us in the application of the new standard. The cumulative effect of initially applying the new revenue standard on January 1, 2018 is estimated to be an increase to retained earnings of approximately $400 million to $600 million . Most of our indefeasible right of use arrangements, including certain long-term prepaid customer capacity arrangements, are accounted for as operating leases. |
Sale of Data Centers and Colo31
Sale of Data Centers and Colocation Business (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of disposal assets held-for-sale and liabilities attributable to disposal assets held-for-sale | The following table reflects the assets sold to and the liabilities assumed by Cyxtera on May 1, 2017, including the impact of failed-sale-leaseback: Dollars in millions Goodwill $ 1,142 Property, plant and equipment 1,051 Other intangible assets 249 Other assets 66 Less assets not removed as a result of the failed-sale-leaseback (526 ) Total net amount of assets derecognized $ 1,982 Capital lease obligations 294 Other liabilities 274 Less imputed financing obligations from the failed-sale-leaseback (628 ) Total net imputed liabilities recognized $ (60 ) |
Sale-leaseback transactions | In addition, the failed-sale-leaseback accounting treatment had the following effects on our consolidated results of operations for the year ended December 31, 2017: Positive (Negative) Impact to Net Income Dollars in millions Increase in revenue $ 49 Decrease in cost of sales 15 Increase in loss on sale of business included in selling, general and administrative expense (102 ) Increase in depreciation expense (one-time) (44 ) Increase in depreciation expense (ongoing) (47 ) Increase in interest expense (39 ) Decrease in income tax expense 65 Decrease in net income $ (103 ) |
Goodwill, Customer Relationsh32
Goodwill, Customer Relationships and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill and other intangible assets | Goodwill, customer relationships and other intangible assets consisted of the following: As of December 31, 2017 2016 (Dollars in millions) Goodwill $ 30,475 19,650 Customer relationships, less accumulated amortization of $7,096 and $6,318 $ 10,876 2,797 Indefinite-life intangible assets $ 269 269 Other intangible assets subject to amortization: Capitalized software, less accumulated amortization of $2,294 and $2,019 1,469 1,227 Trade names and patents, less accumulated amortization of $31 and $23 159 35 Total other intangible assets, net $ 1,897 1,531 |
Schedule of estimated amortization expense for intangible assets | We estimate that total amortization expense for intangible assets (which include preliminary estimates for the intangible assets acquired from Level 3) for the years ending December 31, 2018 through 2022 will be as follows: (Dollars in millions) 2018 $ 1,802 2019 1,701 2020 1,590 2021 1,149 2022 977 |
Schedule of goodwill attributable to segments | The following table shows the rollforward of goodwill assigned to our reportable segments from December 31, 2015 through December 31, 2017 . Business Consumer Total (Dollars in millions) As of December 31, 2015 (1) $ 10,464 10,278 20,742 Purchase accounting and other adjustments 49 — 49 Goodwill attributable to the colocation business and data centers reclassified to assets held for sale (1,141 ) — (1,141 ) As of December 31, 2016 (1) 9,372 10,278 19,650 Purchase accounting and other adjustments 10,825 — 10,825 As of December 31, 2017 (1) $ 20,197 10,278 30,475 _____________________________________________________________________________ (1) Goodwill is net of accumulated impairment losses of $1.1 billion that related to our former hosting segment now included in our business segment. |
Long-Term Debt and Credit Fac33
Long-Term Debt and Credit Facilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt including unamortized discounts and premiums | The following chart reflects the consolidated long-term debt of CenturyLink, Inc. and its subsidiaries, including unamortized discounts and premiums and unamortized debt issuance costs, but excluding intercompany debt: As of December 31, Interest Rates (1) Maturities 2017 2016 (Dollars in millions) Senior Secured Debt: CenturyLink, Inc. 2017 Revolving Credit Facility (2) 4.153% - 4.285% 2022 $ 405 — Term Loan A 4.319% 2022 1,575 — Term Loan A-1 4.319% 2022 370 — Term Loan B 4.319% 2025 6,000 — Subsidiaries: Level 3 Financing, Inc. Tranche B 2024 Term Loan 3.696% 2024 4,611 — Embarq Corporation subsidiaries First mortgage bonds 7.125% - 8.770% 2018 - 2025 151 223 Senior Notes and Other Debt: CenturyLink, Inc. Senior notes 5.625% - 7.650% 2019 - 2042 8,125 8,975 2012 Credit facility and revolving line of credit (2) — — — 370 2012 Term loan — — — 336 Subsidiaries: Level 3 Financing, Inc. Senior notes 5.125% - 6.125% 2021 - 2026 5,315 — Level 3 Parent, LLC Senior notes 5.750% 2022 600 — Qwest Corporation Senior notes 6.125% - 7.750% 2018 - 2057 7,294 7,259 Term loan 3.570% 2025 100 100 Qwest Capital Funding, Inc. Senior notes 6.500% - 7.750% 2018 - 2031 981 981 Embarq Corporation and subsidiary Senior note 7.995% 2036 1,485 1,485 Other 9.000% 2019 150 150 Capital lease and other obligations (3) Various Various 891 440 Unamortized discounts and other, net 23 (133 ) Unamortized debt issuance costs (350 ) (193 ) Total long-term debt 37,726 19,993 Less current maturities not associated with assets held for sale (443 ) (1,503 ) Less capital lease obligations associated with assets held for sale — (305 ) Long-term debt, excluding current maturities and capital leases obligations associated with assets held for sale $ 37,283 18,185 _______________________________________________________________________________ (1) As of December 31, 2017. (2) The aggregate amount outstanding on our 2017 revolving credit facility at December 31, 2017 was $405 million with a weighted-average interest rate of 4.186% . These amounts change on a regular basis. The aggregate amount outstanding on our 2012 credit facility and revolving line of credit borrowings at December 31, 2016 was $370 million with weighted-average interest rate of 4.500% . As described under "2017 CenturyLink Credit Agreement" below, we discharged and terminated our 2012 credit facility on November 1, 2017. (3) As a result of not meeting the sale leaseback accounting requirements, we must treat a certain amount of the pre-tax cash proceeds from the sale of our real estate assets as though it were the result of a financing obligation on our consolidated balance sheet. Also, the capital lease obligations that were shown as held for sale as of December 31, 2016 are retained and revalued. Please see Note 3—Sale of Data Centers and Colocation Business for additional information on our most current estimate of the financing obligation. |
Schedule of maturities of long-term debt | Set forth below is the aggregate principal amount of our long-term debt (excluding unamortized discounts, net and unamortized debt issuance costs) maturing during the following years: (Dollars in millions) (1)(2) 2018 $ 443 2019 638 2020 1,194 2021 3,109 2022 5,033 2023 and thereafter 27,137 Total long-term debt $ 37,554 _______________________________________________________________________________ (1) The amount outstanding on the data centers obligation at December 31, 2017 was $598 million . The aggregate maturities of long-term debt do not include $499 million of this obligation, which, at the end of the lease term on April 30, 2020, will be derecognized along with the remaining net book value of the associated real estate assets. Also, the aggregate maturities of long-term debt do not include future imputed lease income of $173 million attributable to the accounting for certain of the real estate assets under the failed-sale-leaseback. See Note 3—Sale of Data Centers and Colocation Business for additional information. (2) Actual principal paid in any year may differ due to the possible future refinancing of outstanding debt or the issuance of new debt. The projected amounts in the table also exclude any impacts from any further acquisitions. |
Schedule of amount of gross interest expense, net of capitalized interest | Interest expense includes interest on total long-term debt. The following table presents the amount of gross interest expense, net of capitalized interest: Years Ended December 31, 2017 2016 2015 (Dollars in millions) Interest expense: Gross interest expense $ 1,559 1,372 1,364 Capitalized interest (78 ) (54 ) (52 ) Total interest expense $ 1,481 1,318 1,312 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Schedule of components of accounts receivable | The following table presents details of our accounts receivable balances: As of December 31, 2017 2016 (Dollars in millions) Trade and purchased receivables $ 2,245 1,882 Earned and unbilled receivables 436 299 Other 40 14 Total accounts receivable 2,721 2,195 Less: allowance for doubtful accounts (164 ) (178 ) Accounts receivable, less allowance $ 2,557 2,017 |
Schedule of details of allowance for doubtful accounts | The following table presents details of our allowance for doubtful accounts: Beginning Balance Additions Deductions Ending Balance (Dollars in millions) 2017 $ 178 176 (190 ) 164 2016 $ 152 192 (166 ) 178 2015 $ 162 177 (187 ) 152 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of net property, plant and equipment | Net property, plant and equipment is composed of the following: Depreciable Lives As of December 31, 2017 2016 (Dollars in millions) Land N/A $ 883 563 Fiber, conduit and other outside plant (1) 15-45 years 22,798 16,996 Central office and other network electronics (2) 3-10 years 18,538 13,768 Support assets (3) 3-30 years 7,586 6,623 Construction in progress (4) N/A 1,399 1,244 Gross property, plant and equipment 51,204 39,194 Accumulated depreciation (24,352 ) (22,155 ) Net property, plant and equipment $ 26,852 17,039 _______________________________________________________________________________ (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, cable landing stations, data centers, computers and other administrative and support equipment. (4) Construction in progress includes inventory held for construction and property of the aforementioned categories that has not been placed in service as it is still under construction. |
Schedule of changes to asset retirement obligations | The following table provides asset retirement obligation activity: Years Ended December 31, 2017 2016 2015 (Dollars in millions) Balance at beginning of year $ 95 91 107 Accretion expense 6 6 7 Liabilities assumed in acquisition of Level 3 45 — — Liabilities settled (3 ) (2 ) (2 ) Liabilities transferred to Cyxtera (20 ) — — Change in estimate (8 ) — (21 ) Balance at end of year $ 115 95 91 |
Severance and Leased Real Est36
Severance and Leased Real Estate (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Schedule of changes in accrued liabilities for severance expenses and leased real estate | Changes in our accrued liabilities for severance expenses and leased real estate were as follows: Severance Real Estate (Dollars in millions) Balance at December 31, 2015 $ 14 80 Accrued to expense 173 4 Payments, net (89 ) (20 ) Reversals and adjustments — 3 Balance at December 31, 2016 98 67 Accrued to expense 42 4 Liabilities assumed in acquisition of Level 3 1 4 Payments, net (108 ) (13 ) Reversals and adjustments — 2 Balance at December 31, 2017 $ 33 64 |
Employee Benefits (Tables)
Employee Benefits (Tables) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Employee Benefits | ||
Schedule of estimated future benefit payments | The qualified pension, non-qualified pension and post-retirement health care benefit payments and premiums and life insurance premium payments are paid by us or distributed from plan assets. The estimated benefit payments provided below are based on actuarial assumptions using the demographics of the employee and retiree populations and have been reduced by estimated participant contributions. Pension Plans Post-Retirement Benefit Plans Medicare Part D Subsidy Receipts (Dollars in millions) Estimated future benefit payments: 2018 $ 1,031 293 (7 ) 2019 973 280 (7 ) 2020 951 271 (7 ) 2021 929 262 (7 ) 2022 908 253 (7 ) 2023 - 2027 4,170 1,122 (31 ) | |
Schedule of actuarial assumptions used to compute net periodic benefit expense | The actuarial assumptions used to compute the net periodic benefit expense for our qualified pension, non-qualified pension and post-retirement benefit plans are based upon information available as of the beginning of the year, as presented in the following table. Pension Plans Post-Retirement Benefit Plans 2017 2016 2015 2017 2016 2015 Actuarial assumptions at beginning of year: Discount rate 3.50% - 4.10% 3.50% - 4.50% 3.50% - 4.10% 3.90 % 4.15 % 3.80 % Rate of compensation increase 3.25 % 3.25 % 3.25 % N/A N/A N/A Expected long-term rate of return on plan assets 6.50 % 7.00 % 7.50 % 5.00 % 7.00 % 7.50 % Initial health care cost trend rate N/A N/A N/A 7.00% / 5.00% 5.00% / 5.25% 6.00% / 6.50% Ultimate health care cost trend rate N/A N/A N/A 4.50 % 4.50 % 4.50 % Year ultimate trend rate is reached N/A N/A N/A 2025 2025 2025 _______________________________________________________________________________ N/A-Not applicable | |
Schedule of actuarial assumptions used to compute the funded status for the plans | The actuarial assumptions used to compute the funded status for the plans are based upon information available as of December 31, 2017 and 2016 and are as follows: Pension Plans Post-Retirement Benefit Plans December 31, December 31, 2017 2016 2017 2016 Actuarial assumptions at end of year: Discount rate 3.44% - 3.70% 3.50% - 4.10% 3.53 % 3.90 % Rate of compensation increase 3.25 % 3.25 % N/A N/A Initial health care cost trend rate N/A N/A 7.00% / 5.00% 5.00% / 5.50% Ultimate health care cost trend rate N/A N/A 4.50 % 4.50 % Year ultimate trend rate is reached N/A N/A 2025 2025 _______________________________________________________________________________ N/A-Not applicable | |
Schedule of gross notional exposure of the derivative instruments directly held by the plans | The gross notional exposure of the derivative instruments directly held by the pension benefit plan is shown below. The notional amount of the derivatives corresponds to market exposure but does not represent an actual cash investment. Our post-retirement plans were not invested in derivative instruments for the years ended December 31, 2017 or 2016. Gross Notional Exposure Pension Plan Years Ended December 31, 2017 2016 (Dollars in millions) Derivative instruments: Exchange-traded U.S. equity futures $ 256 104 Exchange-traded Treasury and other interest rate futures 1,830 1,813 Interest rate swaps 137 260 Credit default swaps 100 240 Equity index swaps 1 — Foreign exchange forwards 293 778 Options 259 206 | |
Schedule of fair value of the plans' assets by asset category | The table below presents the fair value of plan assets valued at NAV by category for our pension and post-retirement plans at December 31, 2017 and 2016. Fair Value of Plan Assets Valued at NAV Pension Plans at December 31, Post-Retirement Benefit Plans at December 31, 2017 2016 2017 2016 (Dollars in millions) Investment grade bonds (a) $ 163 106 — — High yield bonds (b) 483 521 — 1 Emerging market bonds (c) 14 6 — — Diversified strategies (d) 538 522 — 1 U.S. stocks (e) 73 58 — — Non-U.S. stocks (f) 627 560 — 1 Emerging market stocks (g) 98 76 — — Private equity (h) 460 506 10 14 Private debt (i) 374 369 1 1 Market neutral hedge funds (j) 769 739 — 1 Directional hedge funds (j) 636 657 — 1 Real estate (k) 903 926 1 8 Multi-asset strategies (l) 424 412 — — Cash equivalents and short-term investments (n) 57 106 10 13 Total investments valued at NAV $ 5,619 5,564 22 41 | |
Schedule of the unfunded status of the benefit plans | The following table presents the unfunded status of the pensions and post-retirement benefit plans: Pension Plans Post-Retirement Benefit Plans Years Ended December 31, Years Ended December 31, 2017 2016 2017 2016 (Dollars in millions) Benefit obligation $ (13,122 ) (13,301 ) (3,375 ) (3,413 ) Fair value of plan assets 11,060 10,892 23 53 Unfunded status (2,062 ) (2,409 ) (3,352 ) (3,360 ) Current portion of unfunded status $ (5 ) (6 ) (262 ) (236 ) Non-current portion of unfunded status $ (2,057 ) (2,403 ) (3,090 ) (3,124 ) | |
Schedule of items not recognized as a component of net periodic benefits expense | The following table presents cumulative items not recognized as a component of net periodic benefits expense as of December 31, 2016, items recognized as a component of net periodic benefits expense in 2017 , additional items deferred during 2017 and cumulative items not recognized as a component of net periodic benefits expense as of December 31, 2017 . The items not recognized as a component of net periodic benefits expense have been recorded on our consolidated balance sheets in accumulated other comprehensive loss: As of and for the Years Ended December 31, 2016 Recognition of Net Periodic Benefits Expense Deferrals Net Change in AOCL 2017 (Dollars in millions) Accumulated other comprehensive loss: Pension plans: Net actuarial (loss) gain $ (3,148 ) 205 51 256 (2,892 ) Prior service benefit (cost) 62 (8 ) — (8 ) 54 Deferred income tax benefit (expense) 1,191 (72 ) (12 ) (84 ) 1,107 Total pension plans (1,895 ) 125 39 164 (1,731 ) Post-retirement benefit plans: Net actuarial (loss) gain (137 ) — (113 ) (113 ) (250 ) Prior service (cost) benefit (127 ) 20 — 20 (107 ) Deferred income tax benefit (expense) 102 (7 ) 27 20 122 Total post-retirement benefit plans (162 ) 13 (86 ) (73 ) (235 ) Total accumulated other comprehensive loss $ (2,057 ) 138 (47 ) 91 (1,966 ) | The following table presents cumulative items not recognized as a component of net periodic benefits expense as of December 31, 2015, items recognized as a component of net periodic benefits expense in 2016 , additional items deferred during 2016 and cumulative items not recognized as a component of net periodic benefits expense as of December 31, 2016. The items not recognized as a component of net periodic benefits expense have been recorded on our consolidated balance sheets in accumulated other comprehensive loss: As of and for the Years Ended December 31, 2015 Recognition Deferrals Net 2016 (Dollars in millions) Accumulated other comprehensive loss: Pension plans: Net actuarial (loss) gain $ (2,857 ) 175 (466 ) (291 ) (3,148 ) Prior service benefit (cost) 72 (8 ) (2 ) (10 ) 62 Deferred income tax benefit (expense) 1,070 (67 ) 188 121 1,191 Total pension plans (1,715 ) 100 (280 ) (180 ) (1,895 ) Post-retirement benefit plans: Net actuarial (loss) gain (147 ) — 10 10 (137 ) Prior service (cost) benefit (147 ) 20 — 20 (127 ) Deferred income tax benefit (expense) 114 (8 ) (4 ) (12 ) 102 Total post-retirement benefit plans (180 ) 12 6 18 (162 ) Total accumulated other comprehensive loss $ (1,895 ) 112 (274 ) (162 ) (2,057 ) |
Schedule of estimated items to be recognized in 2013 as a component of net periodic benefit expense | The following table presents estimated items to be recognized in 2018 as a component of net periodic benefit expense of the pension, non-qualified pension and post-retirement benefit plans: Pension Plans Post-Retirement Plans (Dollars in millions) Estimated recognition of net periodic (cost) benefit income in 2018: Net actuarial loss $ (205 ) — Prior service income (cost) 8 (20 ) Deferred income tax benefit 48 4 Estimated net periodic benefit expense to be recorded in 2018 as a component of other comprehensive (loss) income $ (149 ) (16 ) | |
Pension plans | ||
Employee Benefits | ||
Schedule of components of net periodic pension income and post-retirement benefit expense | Net periodic benefit expense (income) for our qualified and non-qualified pension plans includes the following components: Pension Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Service cost $ 63 64 83 Interest cost 411 427 568 Expected return on plan assets (666 ) (732 ) (898 ) Special termination benefits charge — 13 — Recognition of prior service (credit) cost (8 ) (8 ) 5 Recognition of actuarial loss 205 175 161 Net periodic pension benefit expense (income) $ 5 (61 ) (81 ) | |
Schedule of change in benefit obligation | The following tables summarize the change in the benefit obligations for the pension and post-retirement benefit plans: Pension Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Change in benefit obligation Benefit obligation at beginning of year $ 13,301 13,349 15,042 Service cost 63 64 83 Interest cost 411 427 568 Plan amendments — 2 (100 ) Special termination benefits charge — 13 — Actuarial loss (gain) 590 487 (800 ) Benefits paid by company (5 ) (7 ) (6 ) Benefits paid from plan assets (1,238 ) (1,034 ) (1,438 ) Benefit obligation at end of year $ 13,122 13,301 13,349 | |
Schedule of change in plan assets | The following tables summarize the change in the fair value of plan assets for the pension and post-retirement benefit plans: Pension Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Change in plan assets Fair value of plan assets at beginning of year $ 10,892 11,072 12,571 Return on plan assets 1,306 754 (161 ) Employer contributions 100 100 100 Benefits paid from plan assets (1,238 ) (1,034 ) (1,438 ) Fair value of plan assets at end of year $ 11,060 10,892 11,072 | |
Schedule of fair value of the plans' assets by asset category | The tables below present the fair value of plan assets by category and the input levels used to determine those fair values at December 31, 2017 . It is important to note that the asset allocations do not include market exposures that are gained with derivatives. Investments include dividend and interest receivables, pending trades and accrued expenses. Fair Value of Pension Plan Assets at December 31, 2017 Level 1 Level 2 Level 3 Total (Dollars in millions) Investment grade bonds (a) $ 432 1,315 — $ 1,747 High yield bonds (b) — 575 7 582 Emerging market bonds (c) 217 219 1 437 U.S. stocks (e) 1,030 2 3 1,035 Non-U.S. stocks (f) 706 — — 706 Private debt (i) — — 15 15 Multi-asset strategies (l) 440 — — 440 Derivatives (m) 2 — — 2 Cash equivalents and short-term investments (n) — 476 1 477 Total investments, excluding investments valued at NAV $ 2,827 2,587 27 5,441 Investments valued at NAV 5,619 Total pension plan assets $ 11,060 | The tables below present the fair value of plan assets by category and the input levels used to determine those fair values at December 31, 2016 . It is important to note that the asset allocations do not include market exposures that are gained with derivatives. Investments include dividend and interest receivable, pending trades and accrued expenses. Fair Value of Pension Plan Assets at December 31, 2016 Level 1 Level 2 Level 3 Total (Dollars in millions) Investment grade bonds (a) $ 420 1,404 — $ 1,824 High yield bonds (b) 7 597 11 615 Emerging market bonds (c) 212 212 — 424 U.S. stocks (e) 1,146 1 — 1,147 Non-U.S. stocks (f) 721 1 — 722 Multi-asset strategies (l) 389 — — 389 Cash equivalents and short-term investments (n) — 207 — 207 Total investments, excluding investments valued at NAV $ 2,895 2,422 11 5,328 Investments valued at NAV 5,564 Total pension plan assets $ 10,892 |
Summary of changes in fair value of defined benefit plans' Level 3 assets | The table below presents a rollforward of the pension plan assets valued using Level 3 inputs: Pension Plan Assets Valued Using Level 3 Inputs High Yield Bonds Emerging Market Bonds U.S. Stocks Private Debt Cash Total (Dollars in millions) Balance at December 31, 2015 $ 13 1 — — — 14 Net transfers (2 ) — — — — (2 ) Acquisitions 1 — — — — 1 Dispositions (1 ) (1 ) — — — (2 ) Balance at December 31, 2016 11 — — — — 11 Net transfers (1 ) — — 14 — 13 Acquisitions 2 1 — 1 1 5 Actual return on plan assets (5 ) — 3 — — (2 ) Balance at December 31, 2017 $ 7 1 3 15 1 27 | |
Post-Retirement benefit plans | ||
Employee Benefits | ||
Schedule of effects of a 100 basis point change in assumed health care cost rates | A change of 100 basis points in the assumed initial health care cost trend rate would have had the following effects in 2017 : 100 Basis Points Change Increase (Decrease) (Dollars in millions) Effect on the aggregate of the service and interest cost components of net periodic post-retirement benefit expense (consolidated statement of operations) $ 2 (2 ) Effect on benefit obligation (consolidated balance sheet) 60 (57 ) | |
Schedule of components of net periodic pension income and post-retirement benefit expense | Net periodic benefit expense for our post-retirement benefit plans includes the following components: Post-Retirement Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Service cost $ 18 19 24 Interest cost 100 111 140 Expected return on plan assets (2 ) (7 ) (21 ) Special termination benefits charge — 3 — Recognition of prior service cost 20 20 19 Net periodic post-retirement benefit expense $ 136 146 162 | |
Schedule of change in benefit obligation | Post-Retirement Benefit Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Change in benefit obligation Benefit obligation at beginning of year $ 3,413 3,567 3,830 Service cost 18 19 24 Interest cost 100 111 140 Participant contributions 54 57 57 Direct subsidy receipts 7 5 8 Special termination benefits charge — 3 — Actuarial loss (gain) 112 (13 ) (148 ) Benefits paid by company (298 ) (191 ) (181 ) Benefits paid from plan assets (31 ) (145 ) (163 ) Benefit obligation at end of year $ 3,375 3,413 3,567 | |
Schedule of change in plan assets | Post-Retirement Benefit Plans Years Ended December 31, 2017 2016 2015 (Dollars in millions) Change in plan assets Fair value of plan assets at beginning of year $ 53 193 353 Return on plan assets 1 5 3 Benefits paid from plan assets (31 ) (145 ) (163 ) Fair value of plan assets at end of year $ 23 53 193 | |
Schedule of fair value of the plans' assets by asset category | Fair Value of Post-Retirement Plan Assets Level 1 Level 2 Level 3 Total (Dollars in millions) Investment grade bonds (a) $ — — — $ — High yield bonds (b) — — — — U.S. stocks (e) 1 — — 1 Non-U.S. stocks (f) — — — — Cash equivalents and short-term investments (n) — — — — Total investments, excluding investments valued at NAV $ 1 — — 1 Investments valued at NAV 22 Total post-retirement plan assets $ 23 | Fair Value of Post-Retirement Plan Assets Level 1 Level 2 Level 3 Total (Dollars in millions) Investment grade bonds (a) $ 1 2 — $ 3 High yield bonds (b) — 1 — 1 U.S. stocks (e) 2 — — 2 Non-U.S. stocks (f) 1 — — 1 Cash equivalents and short-term investments (n) — 5 — 5 Total investments, excluding investments valued at NAV $ 4 8 — 12 Investments valued at NAV 41 Total post-retirement plan assets $ 53 |
Share-based Compensation (Table
Share-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock option awards activity | The following table summarizes activity involving stock option awards for the year ended December 31, 2017 : Number of Options Weighted- Average Exercise Price (in thousands) Outstanding and Exercisable at December 31, 2016 3,008 $ 40.08 Exercised (12 ) 10.75 Forfeited/Expired (1,974 ) 46.82 Outstanding and Exercisable at December 31, 2017 1,022 27.41 |
Restricted stock and restricted stock unit awards activity | The following table summarizes activity involving restricted stock and restricted stock unit awards for the year ended December 31, 2017 : Number of Shares Weighted- Average Grant Date Fair Value (in thousands) Non-vested at December 31, 2016 5,948 $ 31.89 Level 3 replacement awards 12,530 18.99 Granted (1) 5,223 22.02 Vested (2,762 ) 28.55 Forfeited (1,165 ) 26.43 Non-vested at December 31, 2017 19,774 21.90 _____________________________________________________________________________ (1) Shares granted whose related performance conditions were not finalized at December, 31, 2017, were excluded from this figure. During 2016 , we granted 3.6 million shares of restricted stock and restricted stock unit awards at a weighted-average price of $30.83 . During 2015, we granted 2.9 million shares of restricted stock and restricted stock unit awards at a weighted-average price of $31.83 . The total fair value of restricted stock that vested during 2017 , 2016 and 2015 , was $60 million , $47 million and $59 million , respectively. |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted earnings per common share | Basic and diluted earnings per common share for the years ended December 31, 2017 , 2016 and 2015 were calculated as follows: Years Ended December 31, 2017 2016 2015 (Dollars in millions, except per share amounts, shares in thousands) Income (Numerator): Net income $ 1,389 626 878 Earnings applicable to non-vested restricted stock — — — Net income applicable to common stock for computing basic earnings per common share 1,389 626 878 Net income as adjusted for purposes of computing diluted earnings per common share $ 1,389 626 878 Shares (Denominator): Weighted average number of shares: Outstanding during period 635,576 545,946 559,260 Non-vested restricted stock (7,768 ) (6,397 ) (4,982 ) Weighted average shares outstanding for computing basic earnings per common share 627,808 539,549 554,278 Incremental common shares attributable to dilutive securities: Shares issuable under convertible securities 10 10 10 Shares issuable under incentive compensation plans 875 1,120 805 Number of shares as adjusted for purposes of computing diluted earnings per common share 628,693 540,679 555,093 Basic earnings per common share $ 2.21 1.16 1.58 Diluted earnings per common share $ 2.21 1.16 1.58 |
Fair Value Disclosure (Tables)
Fair Value Disclosure (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of the three input levels in the hierarchy of fair value measurements | The three input levels in the hierarchy of fair value measurements are defined by the FASB generally as follows: Input Level Description of Input Level 1 Observable inputs such as quoted market prices in active markets. Level 2 Inputs other than quoted prices in active markets that are either directly or indirectly observable. Level 3 Unobservable inputs in which little or no market data exists. |
Schedule of carrying amounts and estimated fair values of long-term debt, excluding capital lease obligations, and input levels to determine fair values | The following table presents the carrying amounts and estimated fair values of our long-term debt, excluding capital lease and other obligations, as well as the input level used to determine the fair values indicated below: As of December 31, 2017 As of December 31, 2016 Input Level Carrying Amount Fair Value Carrying Amount Fair Value (Dollars in millions) Liabilities-Long-term debt, excluding capital lease and other obligations 2 $ 36,835 36,402 19,553 19,639 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of components of provision for income tax | Years Ended December 31, 2017 2016 2015 (Dollars in millions) Income tax expense was as follows: Federal Current $ 82 335 28 Deferred (988 ) 5 329 State Current 21 27 40 Deferred 16 8 21 Foreign Current 22 26 16 Deferred (2 ) (7 ) 4 Total income tax expense $ (849 ) 394 438 Years Ended December 31, 2017 2016 2015 (Dollars in millions) Income tax (benefit) expense was allocated as follows: Income tax (benefit) expense in the consolidated statements of operations: Attributable to income $ (849 ) 394 438 Stockholders' equity: Compensation expense for tax purposes in excess of amounts recognized for financial reporting purposes — (2 ) (5 ) Tax effect of the change in accumulated other comprehensive loss 81 (109 ) 59 |
Schedule of reconciliation of the statutory federal income tax rate to effective income tax rate | The following is a reconciliation from the statutory federal income tax rate to our effective income tax rate: Years Ended December 31, 2017 2016 2015 (Percentage of pre-tax income) Statutory federal income tax rate 35.0 % 35.0 % 35.0 % State income taxes, net of federal income tax benefit 3.9 % 2.3 % 2.6 % Change in liability for unrecognized tax position 1.0 % 0.2 % 0.4 % Tax reform (209.8 )% — % — % Net foreign income taxes (0.7 )% 0.1 % 0.7 % Foreign dividend paid to a domestic parent company 0.2 % 1.8 % — % Affiliate debt rationalization — % — % (2.6 )% Research and development credits (1.4 )% (0.6 )% (2.1 )% Tax impact on sale of data centers and colocation business 5.0 % — % — % Level 3 acquisition transaction costs 6.0 % — % — % Other, net 3.6 % (0.2 )% (0.7 )% Effective income tax rate (157.2 )% 38.6 % 33.3 % |
Schedule of components of deferred tax assets and deferred tax liabilities | The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities were as follows: As of December 31, 2017 2016 (Dollars in millions) Deferred tax assets Post-retirement and pension benefit costs $ 1,321 2,175 Net operating loss carryforwards 3,951 473 Other employee benefits 112 125 Other 714 342 Gross deferred tax assets 6,098 3,115 Less valuation allowance (1,341 ) (375 ) Net deferred tax assets 4,757 2,740 Deferred tax liabilities Property, plant and equipment, primarily due to depreciation differences (2,935 ) (3,626 ) Goodwill and other intangible assets (3,785 ) (2,577 ) Other (16 ) — Gross deferred tax liabilities (6,736 ) (6,203 ) Net deferred tax liability $ (1,979 ) (3,463 ) |
Summary of the reconciliation of the change in gross unrecognized tax benefits | A reconciliation of the change in our gross unrecognized tax benefits (excluding both interest and any related federal benefit) from January 1 to December 31 for 2017 and 2016 is as follows: 2017 2016 (Dollars in millions) Unrecognized tax benefits at beginning of year $ 16 15 Assumed in the acquisition of Level 3 18 — Tax position of prior periods netted against deferred tax assets assumed in the acquisition of Level 3 2 — Increase in tax positions taken in the current year 1 1 Increase in tax positions taken in the prior year 3 — Unrecognized tax benefits at end of year $ 40 16 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Schedule of segment information | The following table summarizes our segment results for 2017 , 2016 and 2015 based on the segment categorization we were operating under at December 31, 2017 . Years Ended December 31, 2017 2016 2015 (Dollars in millions) Total segment revenues $ 16,924 16,766 17,171 Total segment expenses 9,390 9,081 9,025 Total segment income $ 7,534 7,685 8,146 Total margin percentage 45 % 46 % 47 % Business segment: Revenues $ 11,220 10,704 10,977 Expenses 6,847 6,391 6,395 Income $ 4,373 4,313 4,582 Margin percentage 39 % 40 % 42 % Consumer segment: Revenues $ 5,704 6,062 6,194 Expenses 2,543 2,690 2,630 Income $ 3,161 3,372 3,564 Margin percentage 55 % 56 % 58 % |
Schedule of operating revenues by products and services | Our operating revenues for our products and services are presented as follows for the years ended December 31, 2017 , 2016 and 2015 : Years Ended December 31, 2017 2016 2015 (Dollars in millions) Business segment IP & Data Services (1) $ 3,595 2,851 2,704 Transport & Infrastructure (2) 3,680 3,929 4,157 Voice & Collaboration (3) 3,294 3,284 3,429 IT & Managed Services (4) 651 640 687 Total business segment revenues 11,220 10,704 10,977 Consumer segment IP & Data Services (5) 448 506 468 Transport & Infrastructure (6) 2,871 2,897 2,829 Voice & Collaboration (3) 2,385 2,659 2,897 Total consumer segment revenues 5,704 6,062 6,194 Non-segment revenues Regulatory revenues (7) 732 704 729 Total non-segment revenues 732 704 729 Total revenues $ 17,656 17,470 17,900 ______________________________________________________________________ (1) Includes primarily VPN data network, Ethernet, IP and ancillary revenues. (2) Includes primarily broadband, private line (including business data services), colocation and data centers, wavelength and ancillary revenues. (3) Includes local, long-distance and other ancillary revenues. (4) Includes IT services and managed services revenues. (5) Includes retail video revenues (including our facilities-based video revenues). (6) Includes primarily broadband and equipment sales and professional services revenues. (7) Includes CAF Phase I, CAF Phase 2, federal and state USF support revenue, sublease rental income and failed-sale leaseback income. |
Schedule of reconciliation from segment income to consolidated net income | The following table reconciles segment income to net income for the years ended December 31, 2017 , 2016 and 2015 : Years Ended December 31, 2017 2016 2015 (Dollars in millions) Total segment income $ 7,534 7,685 8,146 Regulatory revenues 732 704 729 Depreciation and amortization (3,936 ) (3,916 ) (4,189 ) Non-segment expenses (2,321 ) (2,140 ) (2,107 ) Other expenses, net (1,469 ) (1,313 ) (1,263 ) Income before income tax expense 540 1,020 1,316 Income tax benefit (expense) 849 (394 ) (438 ) Net income $ 1,389 626 878 |
Quarterly Financial Data (Una43
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly financial information | First Quarter Second Quarter Third Quarter Fourth Quarter Total (Dollars in millions, except per share amounts) 2017 Operating revenues $ 4,209 4,090 4,034 5,323 17,656 Operating income 631 367 487 524 2,009 Net income 163 17 92 1,117 1,389 Basic earnings per common share 0.30 0.03 0.17 1.26 2.21 Diluted earnings per common share 0.30 0.03 0.17 1.26 2.21 2016 Operating revenues $ 4,401 4,398 4,382 4,289 17,470 Operating income 688 647 593 405 2,333 Net income 236 196 152 42 626 Basic earnings per common share 0.44 0.36 0.28 0.08 1.16 Diluted earnings per common share 0.44 0.36 0.28 0.08 1.16 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of capital lease activity | The tables below summarize our capital lease activity: Years Ended December 31, 2017 2016 2015 (Dollars in millions) Assets acquired through capital leases $ 35 45 17 Depreciation expense 50 70 96 Cash payments towards capital leases 48 58 89 As of December 31, 2017 2016 (Dollars in millions) Assets included in property, plant and equipment $ 342 705 Accumulated depreciation 153 351 |
Schedule of future annual minimum payments under capital lease arrangements | The future annual minimum payments under capital lease arrangements as of December 31, 2017 were as follows: Future Minimum Payments (1) (Dollars in millions) Capital lease obligations: 2018 $ 56 2019 45 2020 32 2021 25 2022 22 2023 and thereafter 203 Total minimum payments 383 Less: amount representing interest and executory costs (117 ) Present value of minimum payments 266 Less: current portion (40 ) Long-term portion $ 226 |
Schedule of future rental commitments for operating leases | At December 31, 2017 , our future rental commitments for operating leases were as follows: Future Minimum Payments (Dollars in millions) 2018 $ 666 2019 533 2020 467 2021 367 2022 326 2023 and thereafter 2,116 Total future minimum payments (1) $ 4,475 _______________________________________________________________________________ (1) Minimum payments have not been reduced by minimum sublease rentals of $92 million due in the future under non-cancelable subleases. |
Other Financial Information (Ta
Other Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Additional Financial Information Disclosure [Abstract] | |
Schedule of components of other current assets | The following table presents details of other current assets in our consolidated balance sheets: As of December 31, 2017 2016 (Dollars in millions) Prepaid expenses $ 294 206 Income tax receivable 258 51 Materials, supplies and inventory 128 134 Deferred activation and installation charges 128 101 Other 133 55 Total other current assets $ 941 547 |
Schedule of current liabilities including accounts payable and other current liabiities | Current liabilities reflected in our consolidated balance sheets include accounts payable and other current liabilities as follows: As of December 31, 2017 2016 (Dollars in millions) Accounts payable $ 1,555 1,179 Other current liabilities: Accrued rent $ 34 31 Legal contingencies 45 30 Other 265 152 Total other current liabilities $ 344 213 |
Accumulated Other Comprehensi46
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||
Summary of the entity's accumulated other comprehensive income (loss) by component | The table below summarizes changes in accumulated other comprehensive loss recorded on our consolidated balance sheet by component for the year ended December 31, 2017 : Pension Plans Post-Retirement Benefit Plans Foreign Currency Translation Adjustment and Other Total (Dollars in millions) Balance at December 31, 2016 $ (1,895 ) (162 ) (60 ) (2,117 ) Other comprehensive income (loss) before reclassifications 39 (86 ) 31 (16 ) Amounts reclassified from accumulated other comprehensive income 125 13 — 138 Net current-period other comprehensive income (loss) 164 (73 ) 31 122 Balance at December 31, 2017 $ (1,731 ) (235 ) (29 ) (1,995 ) | The table below summarizes changes in accumulated other comprehensive loss recorded on our consolidated balance sheet by component for the year ended December 31, 2016 : Pension Plans Post-Retirement Benefit Plans Foreign Currency Translation Adjustment and Other Total (Dollars in millions) Balance at December 31, 2015 $ (1,715 ) (180 ) (39 ) (1,934 ) Other comprehensive income (loss) before reclassifications (280 ) 6 (22 ) (296 ) Amounts reclassified from accumulated other comprehensive income 100 12 1 113 Net current-period other comprehensive income (loss) (180 ) 18 (21 ) (183 ) Balance at December 31, 2016 $ (1,895 ) (162 ) (60 ) (2,117 ) |
Schedule of reclassifications out of accumulated other comprehensive income (loss) by component | The table below presents further information about our reclassifications out of accumulated other comprehensive loss by component for the year ended December 31, 2017 : Year Ended December 31, 2017 Decrease (Increase) in Net Income Affected Line Item in Consolidated Statement of Operations (Dollars in millions) Amortization of pension & post-retirement plans (1) Net actuarial loss $ 205 Other income (expense), net Prior service cost 12 Other income (expense), net Total before tax 217 Income tax benefit (79 ) Income tax expense Net of tax $ 138 ________________________________________________________________________ (1) See Note 9—Employee Benefits for additional information on our net periodic benefit (expense) income related to our pension and post-retirement plans. | The table below presents further information about our reclassifications out of accumulated other comprehensive loss by component for the year ended December 31, 2016 : Year Ended December 31, 2016 Decrease (Increase) in Net Loss Affected Line Item in Consolidated Statement of Operations (Dollars in millions) Amortization of pension & post-retirement plans (1) Net actuarial loss $ 175 Other income (expense), net Prior service cost 12 Other income (expense), net Total before tax 187 Income tax benefit (75 ) Income tax expense Insignificant items $ 1 Net of tax $ 113 ________________________________________________________________________ (1) See Note 9—Employee Benefits for additional information on our net periodic benefit (expense) income related to our pension and post-retirement plans. |
Dividends (Tables)
Dividends (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Dividends, Common Stock [Abstract] | |
Schedule of dividends declared | Our Board of Directors declared the following dividends payable in 2017 and 2016 : Date Declared Record Date Dividend Per Share Total Amount Payment Date (in millions) November 14, 2017 11/27/2017 $ 0.540 $ 577 12/11/2017 August 22, 2017 9/5/2017 0.540 296 9/15/2017 May 24, 2017 6/5/2017 0.540 297 6/16/2017 February 21, 2017 3/3/2017 0.540 295 3/17/2017 November 15, 2016 11/28/2016 0.540 294 12/12/2016 August 23, 2016 9/2/2016 0.540 295 9/16/2016 May 18, 2016 5/31/2016 0.540 294 6/14/2016 February 23, 2016 3/4/2016 0.540 295 3/18/2016 |
Basis of Presentation and Sum48
Basis of Presentation and Summary of Significant Accounting Policies (Details 1) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Change in accounting estimates | |||||||||||
Net income | $ 1,117 | $ 92 | $ 17 | $ 163 | $ 42 | $ 152 | $ 196 | $ 236 | $ 1,389 | $ 626 | $ 878 |
Change in accounting method accounted for as a change in estimate | |||||||||||
Change in accounting estimates | |||||||||||
Combined decrease in pension and post-retirement cost | (122) | (149) | |||||||||
Net income | $ 75 | $ 91 | |||||||||
Earnings per share, basic and diluted | $ 0.12 | $ 0.17 |
Basis of Presentation and Sum49
Basis of Presentation and Summary of Significant Accounting Policies (Details 2) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue Recognition | |||
Term of indefeasible rights of use (in years) | 20 years | ||
Advertising Costs | |||
Advertising expense | $ 218 | $ 216 | $ 210 |
Accounts Receivable and Allowance for Doubtful Accounts | |||
Accounts receivable, past due threshold (in days) | 30 days | ||
Activation and installation charges | Minimum | |||
Revenue Recognition | |||
Customer relationship period for revenue recognition (from eighteen months to over ten years) | 3 years | ||
Activation and installation charges | Maximum | |||
Revenue Recognition | |||
Customer relationship period for revenue recognition (from eighteen months to over ten years) | 7 years |
Basis of Presentation and Sum50
Basis of Presentation and Summary of Significant Accounting Policies (Details 3) $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Customer relationships | Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful life | 7 years |
Customer relationships | Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful life | 15 years |
Capitalized software | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful life | 7 years |
Integrated billing and customer care system | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful life | 20 years |
Finite-lived intangible assets, gross | $ 237 |
Other intangible assets | Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful life | 4 years |
Other intangible assets | Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful life | 20 years |
Basis of Presentation and Sum51
Basis of Presentation and Summary of Significant Accounting Policies (Details 4) shares in Millions | Dec. 31, 2017$ / sharesshares |
Common Stock | |
Class of Stock [Line Items] | |
Unissued shares of CenturyLink common stock | 4 |
Common Stock | Stock compensation plan | |
Class of Stock [Line Items] | |
Unissued shares of CenturyLink common stock | 45 |
Preferred Stock | |
Class of Stock [Line Items] | |
Preferential preferred stock distribution (in dollars per share) | $ / shares | $ 25 |
Basis of Presentation and Sum52
Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation and Summary of Significant Accounting Policies (Details 5) - USD ($) $ in Millions | Jan. 01, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Income tax (benefit) expense | $ (849) | $ 394 | $ 438 | |||||||||
OPERATING INCOME | $ 524 | $ 487 | $ 367 | $ 631 | $ 405 | $ 593 | $ 647 | $ 688 | 2,009 | 2,333 | 2,579 | |
Accounting Standards Update 2016-09 | ||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Income tax (benefit) expense | 5 | |||||||||||
Accounting Standards Update 2016-09 | Restatement adjustment | ||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Cumulative effect on retained earnings, net of tax | 3 | |||||||||||
Cumulative effect on retained earnings, tax | $ 2 | |||||||||||
Accounting Standards Update 2017-07 | Restatement adjustment | New accounting pronouncement, early adoption, effect | ||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
OPERATING INCOME | $ (2) | $ (26) | ||||||||||
Minimum | Accounting Standards Update 2014-09 | Scenario, Forecast | ||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Cumulative effect on retained earnings, net of tax | $ 400 | |||||||||||
Maximum | Accounting Standards Update 2014-09 | Scenario, Forecast | ||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Cumulative effect on retained earnings, net of tax | $ 600 |
Acquisition of Level 3 (Details
Acquisition of Level 3 (Details) - USD ($) $ / shares in Units, shares in Millions | Nov. 02, 2017 | Nov. 01, 2017 | Dec. 31, 2017 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | Oct. 31, 2017 |
Business acquisition | |||||||||||||
Cash paid for Converted RSUs awards | $ 5,000,000 | $ 39,000,000 | $ 4,000,000 | ||||||||||
Total long-term debt | $ 37,554,000,000 | $ 37,554,000,000 | 37,554,000,000 | $ 37,554,000,000 | |||||||||
Goodwill | 30,475,000,000 | 30,475,000,000 | $ 19,650,000,000 | $ 30,475,000,000 | 19,650,000,000 | $ 20,742,000,000 | 30,475,000,000 | ||||||
Acquired finite-lived intangible assets, weighted average useful life | 12 years | 12 years | |||||||||||
Level 3 Communications, Inc. | |||||||||||||
Business acquisition | |||||||||||||
Price per share of stock in business acquisition (per share) | $ 26.50 | ||||||||||||
Business acquisition total consideration | $ 19,617,000,000 | ||||||||||||
Total long-term debt assumed | (10,600,000,000) | ||||||||||||
Goodwill | 10,837,000,000 | ||||||||||||
Expected tax deductible amount of Goodwill | 0 | ||||||||||||
Cash, accounts receivable and other current assets | 3,317,000,000 | ||||||||||||
Property, plant and equipment | 9,311,000,000 | ||||||||||||
Other noncurrent assets | 782,000,000 | ||||||||||||
Current liabilities, excluding long-term debt | (1,461,000,000) | ||||||||||||
Current maturities of long-term debt | (7,000,000) | ||||||||||||
Long-term debt | (10,888,000,000) | ||||||||||||
Deferred credits and other liabilities | (1,629,000,000) | ||||||||||||
Total estimated aggregate consideration | 19,617,000,000 | ||||||||||||
Preliminary estimated fair value of acquired accounts receivable | 866,000,000 | ||||||||||||
Gross contractual amount of acquired accounts receivable | 884,000,000 | ||||||||||||
Estimated uncollectible amount of acquired accounts receivable | (18,000,000) | ||||||||||||
Transaction-related expenses | 174,000,000 | 174,000,000 | 47,000,000 | $ 174,000,000 | 47,000,000 | 174,000,000 | |||||||
Integration-related expenses | 97,000,000 | 5,000,000 | |||||||||||
Total acquisition-related expenses | 206,000,000 | $ 37,000,000 | $ 18,000,000 | $ 10,000,000 | 52,000,000 | 271,000,000 | 52,000,000 | 323,000,000 | |||||
Operating revenues (pro forma) | 24,321,000,000 | 25,378,000,000 | |||||||||||
Net income (pro forma) | $ 1,632,000,000 | $ 883,000,000 | |||||||||||
Basic earnings per share (pro forma) | $ 1,540,000 | $ 0.84 | |||||||||||
Diluted earnings per share (pro forma) | $ 1,540,000 | $ 0.84 | |||||||||||
Level 3 Communications, Inc. | Level 3 Communications, Inc. | |||||||||||||
Business acquisition | |||||||||||||
Transaction-related expenses | $ 47,000,000 | ||||||||||||
Level 3 Communications, Inc. | Level 3 Parent, LLC | |||||||||||||
Business acquisition | |||||||||||||
Operating revenues contributed by Level 3 since acquisition date | 1,390,000,000 | ||||||||||||
Net loss contributed by Level 3 since acquisition date | 144,000,000 | ||||||||||||
Common Stock | Level 3 Communications, Inc. | |||||||||||||
Business acquisition | |||||||||||||
Stock per share issuable in business acquisition, Description | 1.4286 shares of our common stock | 1.4286 shares of CenturyLink common stock | |||||||||||
Business acquisition, shares of common stock issued | 517.3 | ||||||||||||
Price of share of common stock (per share) | $ 18.99 | ||||||||||||
Estimated liability for dissenting common shares | $ 60,000,000 | ||||||||||||
Customer relationships | |||||||||||||
Business acquisition | |||||||||||||
Acquired finite-lived intangible assets, weighted average useful life | 12 years | ||||||||||||
Customer relationships | Level 3 Communications, Inc. | |||||||||||||
Business acquisition | |||||||||||||
Customer relationships and other | 8,964,000,000 | ||||||||||||
Other intangible assets | Level 3 Communications, Inc. | |||||||||||||
Business acquisition | |||||||||||||
Customer relationships and other | $ 391,000,000 | ||||||||||||
Restricted Stock Units (RSUs) | Common Stock | Level 3 Communications, Inc. | |||||||||||||
Business acquisition | |||||||||||||
Stock per share issuable in business acquisition, Description | each outstanding Level 3 restricted stock unit award granted on or after April 1, 2014 (other than these granted to outside directors of Level 3) was converted into a CenturyLink restricted stock unit award using a conversion ratio of 2.8386 to 1 as determined in accordance with a formula set forth in the merger agreement (the "Continuing RSU Awards") | Each outstanding Level 3 restricted stock unit award granted on or after April 1, 2014 (other than those granted to outside directors of Level 3) was converted into a CenturyLink restricted stock unit award using a conversion ratio of 2.8386 to 1 as determined in accordance with a formula set forth in the merger agreement (“the Continuing RSU Awards”) | |||||||||||
Cash paid for Converted RSUs awards | $ 1,000,000 | ||||||||||||
Consideration for Continuing RSUs awards | 136,000,000 | ||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | |||||||||||||
Business acquisition | |||||||||||||
Total long-term debt | 7,945,000,000 | ||||||||||||
Medium-term notes | CenturyLink, Inc. | |||||||||||||
Business acquisition | |||||||||||||
Total long-term debt | $ 0 | $ 0 | $ 336,000,000 | $ 0 | $ 336,000,000 | $ 0 | |||||||
2017 revolving credit facility | Revolving credit facility | CenturyLink Escrow, LLC | |||||||||||||
Business acquisition | |||||||||||||
Total long-term debt | 400,000,000 | ||||||||||||
Level 3 Parent, LLC | CenturyLink, Inc. | |||||||||||||
Business acquisition | |||||||||||||
Note payable - related party | $ 1,825,000,000 | ||||||||||||
Common Stock | Level 3 Communications, Inc. | Level 3 Communications, Inc. | |||||||||||||
Business acquisition | |||||||||||||
Shares issued and outstanding | 0 | ||||||||||||
CenturyLink, Inc. | Level 3 Communications, Inc. | |||||||||||||
Business acquisition | |||||||||||||
CenturyLink, Inc. shareholders' ownership percentage | 51.00% | ||||||||||||
Level 3 Communications, Inc. shareholder's ownership percentage | 49.00% |
Sale of Data Centers and Colo54
Sale of Data Centers and Colocation Business (Details) - USD ($) $ in Millions | May 01, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | May 02, 2017 | Jun. 30, 2017 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Income tax (benefit) expense | $ (849) | $ 394 | $ 438 | ||||||||
Less assets not removed as a result of the failed-sale-leaseback | $ (39,194) | $ (51,204) | (51,204) | (39,194) | |||||||
Total net amount of assets derecognized | 2,376 | 140 | 140 | 2,376 | |||||||
Capital lease obligations | 305 | 0 | 0 | 305 | |||||||
Total net imputed liabilities recognized | (419) | 0 | 0 | (419) | |||||||
Sale and leaseback transaction loss, net | (82) | $ 0 | $ 0 | ||||||||
Colocation Business and Data Centers | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Net proceeds from sales of colocation business and data centers | $ 1,800 | ||||||||||
Income tax (benefit) expense | $ 18 | $ 47 | $ 65 | ||||||||
Total net amount of assets derecognized | 1,982 | 1,982 | |||||||||
Total net imputed liabilities recognized | (60) | (60) | |||||||||
Depreciation and amortization | $ 50 | $ 67 | |||||||||
Colocation Business and Data Centers | Disposal group disposed of by sale, not discontinued operations | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Goodwill | 1,142 | ||||||||||
Property, plant and equipment | 1,051 | ||||||||||
Other intangible assets | 249 | ||||||||||
Other assets | 66 | ||||||||||
Capital lease obligations | 294 | ||||||||||
Other liabilities | 274 | ||||||||||
SIS Holdings, LP | CenturyLink, Inc. | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Noncontrolling Interest in Limited Partnerships | 150 | 150 | |||||||||
Cyxtera Technologies | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Income tax (benefit) expense | (65) | ||||||||||
Less assets not removed as a result of the failed-sale-leaseback | (526) | ||||||||||
Less imputed financing obligations from the failed-sale-leaseback | $ (628) | ||||||||||
Gain (Loss) on asset leaseback, failed-sale-leaseback transaction | $ (119) | (102) | |||||||||
Sale and leaseback transaction loss, net | 82 | ||||||||||
Cyxtera Technologies | Colocation Business and Data Centers | Disposal group disposed of by sale, not discontinued operations | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Disposal group, gain (loss) on disposal | 20 | ||||||||||
Cyxtera Technologies | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Current amount due from affiliate | 49 | $ 49 | |||||||||
Sale-leaseback transaction rent expense | $ 80 |
Sale of Data Centers and Colo55
Sale of Data Centers and Colocation Business Sale of Data Centers and Colocation Business (Details 2) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Sale Leaseback Transaction [Line Items] | |||||||||||
OPERATING REVENUES | $ 5,323 | $ 4,034 | $ 4,090 | $ 4,209 | $ 4,289 | $ 4,382 | $ 4,398 | $ 4,401 | $ 17,656 | $ 17,470 | $ 17,900 |
Decrease in cost of sales | (8,203) | (7,774) | (7,778) | ||||||||
Increase in loss on sale of business included in selling, general and administrative expense | (3,508) | (3,447) | (3,354) | ||||||||
Increase in depreciation expense (ongoing) | (3,936) | (3,916) | (4,189) | ||||||||
Increase in interest expense | (1,481) | (1,318) | (1,312) | ||||||||
Decrease in income tax expense | 849 | (394) | (438) | ||||||||
NET INCOME | $ 1,117 | $ 92 | 17 | $ 163 | $ 42 | $ 152 | $ 196 | $ 236 | 1,389 | $ 626 | $ 878 |
Cyxtera Technologies | |||||||||||
Sale Leaseback Transaction [Line Items] | |||||||||||
OPERATING REVENUES | 49 | ||||||||||
Decrease in cost of sales | 15 | ||||||||||
Increase in loss on sale of business included in selling, general and administrative expense | (102) | ||||||||||
Increase in depreciation expense (one-time) | $ (44) | (44) | |||||||||
Increase in depreciation expense (ongoing) | (47) | ||||||||||
Increase in interest expense | (39) | ||||||||||
Decrease in income tax expense | 65 | ||||||||||
NET INCOME | $ (103) |
Goodwill, Customer Relationsh56
Goodwill, Customer Relationships and Other Intangible Assets (Details) - USD ($) $ in Millions | Nov. 01, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets [Line Items] | ||||
Goodwill | $ 30,475 | $ 19,650 | $ 20,742 | |
Indefinite-life intangible assets | 269 | 269 | ||
Other intangible assets, net | 1,897 | 1,531 | ||
Intangible assets, net (including goodwill) | $ 20,060 | |||
Acquired finite-lived intangible assets, weighted average useful life | 12 years | 12 years | ||
Amortization expense for intangible assets | $ 1,226 | 1,225 | $ 1,353 | |
Gross carrying amount of intangible assets | 52,669 | |||
Customer relationships | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible assets, net | 10,876 | 2,797 | ||
Accumulated amortization | $ 7,096 | 6,318 | ||
Acquired finite-lived intangible assets, weighted average useful life | 12 years | |||
Capitalized software | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible assets, net | $ 1,469 | 1,227 | ||
Accumulated amortization | $ 2,294 | 2,019 | ||
Acquired finite-lived intangible assets, weighted average useful life | 5 years | |||
Tradenames and patents | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible assets, net | $ 159 | 35 | ||
Accumulated amortization | $ 31 | $ 23 | ||
Acquired finite-lived intangible assets, weighted average useful life | 5 years |
Goodwill, Customer Relationsh57
Goodwill, Customer Relationships and Other Intangible Assets (Details 2) $ in Millions | Dec. 31, 2017USD ($) |
Expected amortization expense | |
2,018 | $ 1,802 |
2,019 | 1,701 |
2,020 | 1,590 |
2,021 | 1,149 |
2,022 | $ 977 |
Goodwill, Customer Relationsh58
Goodwill, Customer Relationships and Other Intangible Assets (Details 3) $ in Millions | Oct. 31, 2017 | Oct. 31, 2017 | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Goodwill [Line Items] | |||||
Goodwill | $ 30,475 | $ 19,650 | $ 20,742 | ||
Implied control premium (percent) | 36.00% | ||||
Number of reporting units | 3 | 3 | |||
Business | |||||
Goodwill [Line Items] | |||||
Goodwill | $ 20,197 | $ 9,372 | $ 10,464 |
Goodwill, Customer Relationsh59
Goodwill, Customer Relationships and Other Intangible Assets (Details 4) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Goodwill [rollforward] | ||
Goodwill at the beginning of the period | $ 19,650 | $ 20,742 |
Goodwill acquired during period | 10,825 | 49 |
Goodwill transfered to assets-held-for sale | (1,141) | |
Goodwill at the end of the period | 30,475 | 19,650 |
Business | ||
Goodwill [rollforward] | ||
Goodwill at the beginning of the period | 9,372 | 10,464 |
Goodwill acquired during period | 10,825 | 49 |
Goodwill at the end of the period | 20,197 | 9,372 |
Goodwill accumulated impairment loss | 1,100 | |
Consumer | ||
Goodwill [rollforward] | ||
Goodwill at the beginning of the period | 10,278 | 10,278 |
Goodwill acquired during period | 0 | 0 |
Goodwill at the end of the period | $ 10,278 | 10,278 |
Colocation Business and Data Centers | Business | ||
Goodwill [rollforward] | ||
Goodwill transfered to assets-held-for sale | (1,141) | |
Colocation Business and Data Centers | Consumer | ||
Goodwill [rollforward] | ||
Goodwill transfered to assets-held-for sale | $ 0 |
Goodwill, Customer Relationsh60
Goodwill, Customer Relationships and Other Intangible Assets (Details 5) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Business acquisition | |||
Total consideration to acquire businesses | $ 5 | $ 39 | $ 4 |
Goodwill acquired during period | $ 10,825 | $ 49 | |
Various business acquisitions | |||
Business acquisition | |||
Number of businesses acquired | 3 | ||
Total consideration to acquire businesses | $ 53 | ||
Total consideration, deferred or contingent cash payments | future deferred or contingent cash payments of $14 million | ||
Goodwill acquired during period | $ 49 |
Long-Term Debt and Credit Fac61
Long-Term Debt and Credit Facilities (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Nov. 01, 2017 | Jul. 19, 2017 | Jun. 19, 2017 | Dec. 31, 2016 |
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 37,554 | ||||
Capital Lease and Other Obligations | 891 | $ 440 | |||
Unamortized discounts, net | 23 | (133) | |||
Unamortized debt issuance costs | (350) | (193) | |||
Total long-term debt | 37,726 | 19,993 | |||
Less current maturities not associated with assets held for sale | (443) | (1,503) | |||
Less capital lease obligations associated with assets held for sale(2) | 0 | (305) | |||
Long-term debt, excluding current maturities and capital leases obligations associated with assets held for sale | 37,283 | 18,185 | |||
Embarq Corporation | First mortgage bonds | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | 151 | 223 | |||
Embarq Corporation | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 1,485 | 1,485 | |||
Interest rate, stated percentage (as a percent) | 7.995% | ||||
Embarq Corporation | Other | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 150 | 150 | |||
Interest rate, stated percentage (as a percent) | 9.00% | ||||
CenturyLink, Inc. | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 8,125 | 8,975 | |||
CenturyLink, Inc. | Credit facility | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 0 | $ 370 | |||
Credit facility interest rate at period end (as a percent) | 0.00% | ||||
Weighted average interest rate (as a percent) | 4.50% | ||||
CenturyLink, Inc. | Medium-term notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 0 | $ 336 | |||
Interest rate, stated percentage (as a percent) | 0.00% | ||||
Level 3 Financing, Inc. | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 5,315 | 0 | |||
Level 3 Financing, Inc. | Medium-term notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 4,611 | 0 | |||
Interest rate, stated percentage (as a percent) | 3.696% | ||||
Level 3 Parent, LLC | |||||
Long-term Debt and Credit Facilities | |||||
Capital lease and other obligations | $ 179 | ||||
Total long-term debt | $ 10,526 | ||||
Level 3 Parent, LLC | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 600 | 0 | |||
Interest rate, stated percentage (as a percent) | 5.75% | ||||
Level 3 Parent, LLC | Credit facility | |||||
Long-term Debt and Credit Facilities | |||||
Weighted average interest rate (as a percent) | 5.47% | ||||
Qwest Corporation | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 7,294 | 7,259 | |||
Qwest Corporation | Medium-term notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 100 | 100 | |||
Interest rate, stated percentage (as a percent) | 3.57% | ||||
Qwest Capital Funding, Inc | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 981 | 981 | |||
CenturyLink Escrow, LLC | Medium-term notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 7,945 | ||||
Minimum | Embarq Corporation | First mortgage bonds | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 7.125% | ||||
Minimum | CenturyLink, Inc. | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 5.625% | ||||
Minimum | CenturyLink, Inc. | Credit facility | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 4.153% | ||||
Minimum | Level 3 Financing, Inc. | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 5.125% | ||||
Minimum | Level 3 Parent, LLC | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 5.125% | ||||
Minimum | Qwest Corporation | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 6.125% | ||||
Minimum | Qwest Capital Funding, Inc | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 6.50% | ||||
Maximum | Embarq Corporation | First mortgage bonds | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 8.77% | ||||
Maximum | CenturyLink, Inc. | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 7.65% | ||||
Maximum | CenturyLink, Inc. | Credit facility | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 4.285% | ||||
Maximum | Level 3 Financing, Inc. | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 6.125% | ||||
Maximum | Level 3 Parent, LLC | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 6.125% | ||||
Maximum | Qwest Corporation | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 7.75% | ||||
Maximum | Qwest Capital Funding, Inc | Senior notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 7.75% | ||||
2017 revolving credit facility | CenturyLink, Inc. | Credit facility | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 405 | 0 | |||
Weighted average interest rate (as a percent) | 4.186% | ||||
Term Loan A | CenturyLink, Inc. | Medium-term notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 1,575 | 0 | |||
Interest rate, stated percentage (as a percent) | 4.319% | ||||
Term Loan A-1 | CenturyLink, Inc. | Medium-term notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 370 | 0 | |||
Interest rate, stated percentage (as a percent) | 4.319% | ||||
Term Loan B | CenturyLink, Inc. | Medium-term notes | |||||
Long-term Debt and Credit Facilities | |||||
Total long-term debt | $ 6,000 | $ 0 | |||
Interest rate, stated percentage (as a percent) | 4.319% | ||||
Term Loan B | CenturyLink Escrow, LLC | Medium-term notes | |||||
Long-term Debt and Credit Facilities | |||||
Interest rate, stated percentage (as a percent) | 2.75% | 1.375% |
Long-Term Debt and Credit Fac62
Long-Term Debt and Credit Facilities (Details 2) $ in Millions | Jan. 29, 2018USD ($) | Nov. 02, 2017 | Jun. 19, 2017USD ($) | May 05, 2017USD ($) | Apr. 28, 2017USD ($) | Sep. 15, 2016USD ($) | Aug. 29, 2016USD ($) | Aug. 22, 2016USD ($) | Apr. 06, 2016USD ($) | Jan. 29, 2016USD ($) | Feb. 20, 2015USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Jan. 21, 2018USD ($) | Nov. 01, 2017USD ($) | Aug. 01, 2017USD ($) | Jul. 19, 2017 | Jun. 15, 2017USD ($) | May 08, 2017USD ($) | May 04, 2017USD ($) | Apr. 03, 2017USD ($) | Dec. 23, 2016USD ($) | Sep. 19, 2016USD ($) | Jun. 01, 2016USD ($) | May 02, 2016USD ($) | Apr. 30, 2011USD ($) |
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Net loss on early retirement of debt | $ 5 | $ 27 | $ 0 | ||||||||||||||||||||||||
Total long-term debt | 37,554 | ||||||||||||||||||||||||||
Interest expense: | |||||||||||||||||||||||||||
Gross interest expense | 1,559 | 1,372 | 1,364 | ||||||||||||||||||||||||
Capitalized interest | (78) | (54) | (52) | ||||||||||||||||||||||||
Total interest expense | $ 1,481 | 1,318 | $ 1,312 | ||||||||||||||||||||||||
Long-term debt, gross | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Total long-term debt | $ 9,945 | ||||||||||||||||||||||||||
Level 3 Parent, LLC | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Business Combination, Excess Fair Value of Senior Debt Over Stated Principal | $ 190 | ||||||||||||||||||||||||||
Revolving credit facility | CenturyLink, Inc. | 2017 revolving credit facility | Subsequent event | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Maximum borrowing capacity | $ 2,168 | ||||||||||||||||||||||||||
Revolving credit facility | CenturyLink Escrow, LLC | 2017 revolving credit facility | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Maximum borrowing capacity | $ 2,000 | ||||||||||||||||||||||||||
Lenders of Credit Facility | 18 | ||||||||||||||||||||||||||
Total long-term debt | 400 | ||||||||||||||||||||||||||
Revolving credit facility | CenturyLink Escrow, LLC | 2017 revolving credit facility | Minimum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Lending commitment per lender | $ 36.4 | ||||||||||||||||||||||||||
Revolving credit facility | CenturyLink Escrow, LLC | 2017 revolving credit facility | Minimum | London Interbank Offered Rate (LIBOR) | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 2.25% | ||||||||||||||||||||||||||
Revolving credit facility | CenturyLink Escrow, LLC | 2017 revolving credit facility | Minimum | Base Rate | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 1.25% | ||||||||||||||||||||||||||
Revolving credit facility | CenturyLink Escrow, LLC | 2017 revolving credit facility | Maximum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Lending commitment per lender | $ 167.8 | ||||||||||||||||||||||||||
Revolving credit facility | CenturyLink Escrow, LLC | 2017 revolving credit facility | Maximum | London Interbank Offered Rate (LIBOR) | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 3.00% | ||||||||||||||||||||||||||
Revolving credit facility | CenturyLink Escrow, LLC | 2017 revolving credit facility | Maximum | Base Rate | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 2.00% | ||||||||||||||||||||||||||
Revolving credit facility | CenturyLink Escrow, LLC | 2017 revolving credit facility | Swingline loan | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Maximum borrowing capacity | $ 100 | ||||||||||||||||||||||||||
Revolving credit facility | CenturyLink Escrow, LLC | 2017 revolving credit facility | Letter of credit | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Maximum borrowing capacity | 400 | ||||||||||||||||||||||||||
Medium-term notes | Qwest Corporation | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 3.57% | ||||||||||||||||||||||||||
Total long-term debt | $ 100 | 100 | |||||||||||||||||||||||||
Medium-term notes | Qwest Corporation | Term loan | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Aggregate principal amount of debt issuance | $ 100 | ||||||||||||||||||||||||||
Total long-term debt | $ 100 | 100 | |||||||||||||||||||||||||
Medium-term notes | Qwest Corporation | Term loan | Minimum | London Interbank Offered Rate (LIBOR) | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 1.50% | ||||||||||||||||||||||||||
Medium-term notes | Qwest Corporation | Term loan | Minimum | Base Rate | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 0.50% | ||||||||||||||||||||||||||
Medium-term notes | Qwest Corporation | Term loan | Maximum | London Interbank Offered Rate (LIBOR) | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 2.50% | ||||||||||||||||||||||||||
Medium-term notes | Qwest Corporation | Term loan | Maximum | Base Rate | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 1.50% | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink, Inc. | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 0.00% | ||||||||||||||||||||||||||
Total long-term debt | $ 0 | 336 | |||||||||||||||||||||||||
Medium-term notes | CenturyLink, Inc. | Subsequent event | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Net proceeds from issuance of debt | 132 | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink, Inc. | Term Loan A | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 4.319% | ||||||||||||||||||||||||||
Total long-term debt | $ 1,575 | 0 | |||||||||||||||||||||||||
Medium-term notes | CenturyLink, Inc. | Term Loan A | Subsequent event | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Aggregate principal amount of debt issuance | $ 1,707 | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink, Inc. | Term Loan A-1 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 4.319% | ||||||||||||||||||||||||||
Total long-term debt | $ 370 | 0 | |||||||||||||||||||||||||
Medium-term notes | CenturyLink, Inc. | Term Loan B | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 4.319% | ||||||||||||||||||||||||||
Total long-term debt | $ 6,000 | 0 | |||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Total long-term debt | 7,945 | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Aggregate principal amount of debt issuance | $ 1,575 | ||||||||||||||||||||||||||
Lenders of Credit Facility | 17 | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A | Minimum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Lending commitment per lender | $ 28.6 | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A | Minimum | London Interbank Offered Rate (LIBOR) | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 2.25% | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A | Minimum | Base Rate | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 1.25% | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A | Maximum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Lending commitment per lender | $ 132.2 | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A | Maximum | London Interbank Offered Rate (LIBOR) | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 3.00% | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A | Maximum | Base Rate | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 2.00% | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A-1 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Aggregate principal amount of debt issuance | $ 370 | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A-1 | Minimum | London Interbank Offered Rate (LIBOR) | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 2.25% | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A-1 | Minimum | Base Rate | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 1.25% | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A-1 | Maximum | London Interbank Offered Rate (LIBOR) | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 3.00% | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan A-1 | Maximum | Base Rate | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 2.00% | ||||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan B | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Aggregate principal amount of debt issuance | $ 6,000 | ||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 1.375% | 2.75% | |||||||||||||||||||||||||
Medium-term notes | CenturyLink Escrow, LLC | Term Loan B | London Interbank Offered Rate (LIBOR) | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate margin (as a percent) | 2.75% | ||||||||||||||||||||||||||
Medium-term notes | Level 3 Financing, Inc. | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 3.696% | ||||||||||||||||||||||||||
Total long-term debt | $ 4,611 | 0 | |||||||||||||||||||||||||
Medium-term notes | Level 3 Financing, Inc. | Term loan | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 1.25% | ||||||||||||||||||||||||||
Senior notes | Qwest Corporation | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Total long-term debt | $ 7,294 | 7,259 | |||||||||||||||||||||||||
Senior notes | Qwest Corporation | Minimum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 6.125% | ||||||||||||||||||||||||||
Senior notes | Qwest Corporation | Maximum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 7.75% | ||||||||||||||||||||||||||
Senior notes | Qwest Corporation | 6.75% Notes due 2057 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Aggregate principal amount of debt issuance | $ 575 | ||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 6.75% | ||||||||||||||||||||||||||
Principal amount of over-allotment | $ 85 | ||||||||||||||||||||||||||
Net proceeds from issuance of debt | $ 638 | ||||||||||||||||||||||||||
Senior notes | Qwest Corporation | 6.5% Notes due 2056 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Aggregate principal amount of debt issuance | $ 978 | ||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 6.50% | ||||||||||||||||||||||||||
Principal amount of over-allotment | $ 128 | ||||||||||||||||||||||||||
Net proceeds from issuance of debt | $ 946 | ||||||||||||||||||||||||||
Senior notes | Qwest Corporation | 7.00% Notes due 2056 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Aggregate principal amount of debt issuance | $ 235 | ||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 7.00% | ||||||||||||||||||||||||||
Net proceeds from issuance of debt | $ 227 | ||||||||||||||||||||||||||
Senior notes | Qwest Corporation | 6.5% Notes due 2017 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 6.50% | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 500 | ||||||||||||||||||||||||||
Senior notes | Qwest Corporation | 7.5% Notes due 2051 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Aggregate principal amount of debt issuance | $ 288 | ||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 7.50% | 7.50% | |||||||||||||||||||||||||
Net loss on early retirement of debt | $ (9) | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 287 | $ 125 | |||||||||||||||||||||||||
Senior notes | Qwest Corporation | 7.375% Notes Due 2051 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 7.375% | ||||||||||||||||||||||||||
Net loss on early retirement of debt | $ (18) | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 661 | ||||||||||||||||||||||||||
Senior notes | Qwest Corporation | 8.375% Notes due 2016 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 8.375% | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 235 | ||||||||||||||||||||||||||
Senior notes | CenturyLink, Inc. | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Total long-term debt | $ 8,125 | 8,975 | |||||||||||||||||||||||||
Senior notes | CenturyLink, Inc. | Minimum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 5.625% | ||||||||||||||||||||||||||
Senior notes | CenturyLink, Inc. | Maximum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 7.65% | ||||||||||||||||||||||||||
Senior notes | CenturyLink, Inc. | 2017 revolving credit facility | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 319 | ||||||||||||||||||||||||||
Senior notes | CenturyLink, Inc. | 7.5% Notes due 2024 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Aggregate principal amount of debt issuance | $ 1,000 | ||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 7.50% | ||||||||||||||||||||||||||
Net proceeds from issuance of debt | $ 988 | ||||||||||||||||||||||||||
Senior notes | CenturyLink, Inc. | 5.15% Notes due 2017 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 5.15% | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 350 | ||||||||||||||||||||||||||
Senior notes | CenturyLink, Inc. | 6.00% Noted due 2017 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 6.00% | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 500 | ||||||||||||||||||||||||||
Senior notes | Embarq Corporation | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 7.995% | ||||||||||||||||||||||||||
Total long-term debt | $ 1,485 | 1,485 | |||||||||||||||||||||||||
Senior notes | Embarq Corporation | 8.77% Notes due 2017 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 8.77% | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 72 | ||||||||||||||||||||||||||
Senior notes | Embarq Corporation | 7.082% Notes due 2016 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 7.082% | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 1,184 | ||||||||||||||||||||||||||
Senior notes | Level 3 Financing, Inc. | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Total long-term debt | $ 5,315 | 0 | |||||||||||||||||||||||||
Senior notes | Level 3 Financing, Inc. | Minimum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 5.125% | ||||||||||||||||||||||||||
Senior notes | Level 3 Financing, Inc. | Maximum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 6.125% | ||||||||||||||||||||||||||
Senior notes | Level 3 Parent, LLC | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 5.75% | ||||||||||||||||||||||||||
Total long-term debt | $ 600 | 0 | |||||||||||||||||||||||||
Senior notes | Level 3 Parent, LLC | Minimum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 5.125% | ||||||||||||||||||||||||||
Senior notes | Level 3 Parent, LLC | Maximum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 6.125% | ||||||||||||||||||||||||||
First mortgage bonds | Embarq Corporation | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Total long-term debt | $ 151 | 223 | |||||||||||||||||||||||||
First mortgage bonds | Embarq Corporation | Minimum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 7.125% | ||||||||||||||||||||||||||
First mortgage bonds | Embarq Corporation | Maximum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 8.77% | ||||||||||||||||||||||||||
First mortgage bonds | Embarq Corporation | 8.375% Notes due 2025 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 8.375% | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 5 | ||||||||||||||||||||||||||
First mortgage bonds | Embarq Corporation | 8.77% Notes due 2017 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 8.77% | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 4 | ||||||||||||||||||||||||||
First mortgage bonds | Embarq Corporation | 8.77% Notes due 2017 | Subsequent event | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 8.77% | ||||||||||||||||||||||||||
Repurchased face amount of Senior Notes | $ 13 | ||||||||||||||||||||||||||
Line of credit | CenturyLink, Inc. | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Total long-term debt | $ 0 | 370 | |||||||||||||||||||||||||
Line of credit | CenturyLink, Inc. | Minimum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 4.153% | ||||||||||||||||||||||||||
Line of credit | CenturyLink, Inc. | Maximum | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Interest rate, stated percentage (as a percent) | 4.285% | ||||||||||||||||||||||||||
Line of credit | CenturyLink, Inc. | 2017 revolving credit facility | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Total long-term debt | $ 405 | 0 | |||||||||||||||||||||||||
Letter of credit | CenturyLink, Inc. | Uncommitted revolving letter of credit facility | Letter of credit | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Maximum borrowing capacity | $ 225 | $ 160 | |||||||||||||||||||||||||
Letters of credit outstanding | 104 | 105 | |||||||||||||||||||||||||
Letter of credit | Level 3 Parent, LLC | Letter of credit | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Letters of credit outstanding | 36 | ||||||||||||||||||||||||||
Letter of credit | Level 3 Parent, LLC | Collateralized debt obligations | Letter of credit | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Letters of credit outstanding | $ 30 | ||||||||||||||||||||||||||
Debt instrument, redemption, period one | Senior notes | Qwest Corporation | 6.75% Notes due 2057 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Debt instrument, redemption, description | redeemed by Qwest Corporation, in whole or in part, on or after June 15, 2022, at a redemption price equal to 100% of the principal amount | ||||||||||||||||||||||||||
Debt instrument, redemption, period one | Senior notes | Qwest Corporation | 6.5% Notes due 2056 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Debt instrument, redemption, description | on or after September 1, 2021, at a redemption price equal to 100% of the principal amount redeemed | ||||||||||||||||||||||||||
Debt instrument, redemption, period one | Senior notes | Qwest Corporation | 7.00% Notes due 2056 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Debt instrument, redemption, description | on or after February 1, 2021, at a redemption price equal to 100% of the principal amount redeemed | ||||||||||||||||||||||||||
Debt instrument, redemption, period one | Senior notes | CenturyLink, Inc. | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Debt instrument, redemption, description | Under certain circumstances in connection with a “change of control” of CenturyLink, Inc., it will be required to make an offer to repurchase each series of these senior notes (other than two of its older series of notes) at a price of 101% of the principal amount redeemed, plus accrued and unpaid interest | ||||||||||||||||||||||||||
Debt instrument, redemption, period one | Senior notes | CenturyLink, Inc. | 7.5% Notes due 2024 | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Debt instrument, redemption, description | on or after January 1, 2024, at a redemption price equal to 100% of the principal amount redeemed | ||||||||||||||||||||||||||
Debt instrument, redemption, period one | Senior notes | Level 3 Financing, Inc. | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Debt instrument, redemption, description | Also, under certain circumstances in connection with a "change of control" of Level 3 Parent, LLC, it, as well as Level 3 Financing, Inc., will be required to make an offer to repurchase each series of its outstanding senior notes at a price of 101% of the principal amount redeemed, plus accrued and unpaid interest | ||||||||||||||||||||||||||
Debt instrument, redemption, period one | Senior notes | Level 3 Parent, LLC | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Debt instrument, redemption, description | Also, under certain circumstances in connection with a "change of control" of Level 3 Parent, LLC, it, as well as Level 3 Financing, Inc., will be required to make an offer to repurchase each series of its outstanding senior notes at a price of 101% of the principal amount redeemed, plus accrued and unpaid interest | ||||||||||||||||||||||||||
Fair value measurements determined on a nonrecurring basis | Level 2 | Fair value amount | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Senior long-term debt fair value | $ 36,402 | $ 19,639 | |||||||||||||||||||||||||
Fair value measurements determined on a nonrecurring basis | Level 2 | Fair value amount | Level 3 Parent, LLC | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Senior long-term debt fair value | 10,716 | ||||||||||||||||||||||||||
Level 3 Parent, LLC | CenturyLink, Inc. | |||||||||||||||||||||||||||
Long-term Debt and Credit Facilities | |||||||||||||||||||||||||||
Note payable - related party | $ 1,825 |
Long-Term Debt and Credit Fac63
Long-Term Debt and Credit Facilities (Details 3) - USD ($) $ in Millions | Jun. 19, 2017 | Aug. 22, 2016 | Apr. 06, 2016 | Jan. 29, 2016 | Dec. 31, 2017 | Jan. 29, 2018 |
Long-term debt, gross | CenturyLink Escrow, LLC | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | The 2017 Senior Secured Credit Facilities contain various representations and warranties and extensive affirmative and negative covenants. Such covenants include, among other things and subject to certain significant exceptions, restrictions on our ability to declare or pay dividends, repurchase stock, repay certain other indebtedness, create liens, incur additional indebtedness, make investments, engage in transactions with its affiliates, dispose of assets and merge or consolidate with any other person. | |||||
Senior notes | Qwest Corporation | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | The senior notes of Qwest Corporation were issued under indentures dated April 15, 1990 and October 15, 1999. These indentures contain restrictions on the incurrence of liens and the consummation of certain transactions substantially similar to the above-described covenants in CenturyLink, Inc.'s March 31, 1994 indenture (but contain no mandatory repurchase provisions) | |||||
Senior notes | CenturyLink, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | The senior notes of CenturyLink, Inc. were issued under an indenture dated March 31, 1994. This indenture restricts our ability to (i) incur, issue or create liens upon the property of CenturyLink, Inc. and (ii) consolidate with or merge into, or transfer or lease all or substantially all of our assets to any other party | |||||
Senior notes | Level 3 Parent, LLC | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | The term loan and senior notes of Level 3 Parent, LLC and Level 3 Financing, Inc. contain extensive affirmative and negative covenants. Such covenants include, among other things and subject to certain significant exceptions, restrictions on their ability to declare or pay dividends, repay certain other indebtedness, create liens, incur additional indebtedness, make investments, engage in transactions with their affiliates, dispose of assets and merge or consolidate with any other person | |||||
Senior notes | Level 3 Financing, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | The term loan and senior notes of Level 3 Parent, LLC and Level 3 Financing, Inc. contain extensive affirmative and negative covenants. Such covenants include, among other things and subject to certain significant exceptions, restrictions on their ability to declare or pay dividends, repay certain other indebtedness, create liens, incur additional indebtedness, make investments, engage in transactions with their affiliates, dispose of assets and merge or consolidate with any other person | |||||
Senior notes | Qwest Capital Funding, Inc | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | The senior notes of Qwest Capital Funding, Inc. were issued under an indenture dated June 29, 1998 containing terms substantially similar to those set forth in Qwest Corporation's indentures | |||||
Senior notes | Embarq Corporation | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | Embarq's senior note was issued pursuant to an indenture dated as of May 17, 2006. While Embarq is generally prohibited from creating liens on its property unless its senior notes are secured equally and ratably, Embarq can create liens on its property without equally and ratably securing its senior notes so long as the sum of all indebtedness so secured does not exceed 15% of Embarq's consolidated net tangible assets. The indenture also contains restrictions on the consummation of certain transactions substantially similar to CenturyLink, Inc.’s above-described covenants (but without mandatory repurchase provision), as well as certain customary covenants to maintain properties and pay all taxes and lawful claims | |||||
Senior notes | Debt instrument, redemption, period one | CenturyLink, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, redemption, description | Under certain circumstances in connection with a “change of control” of CenturyLink, Inc., it will be required to make an offer to repurchase each series of these senior notes (other than two of its older series of notes) at a price of 101% of the principal amount redeemed, plus accrued and unpaid interest | |||||
Senior notes | Debt instrument, redemption, period one | Level 3 Parent, LLC | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, redemption, description | Also, under certain circumstances in connection with a "change of control" of Level 3 Parent, LLC, it, as well as Level 3 Financing, Inc., will be required to make an offer to repurchase each series of its outstanding senior notes at a price of 101% of the principal amount redeemed, plus accrued and unpaid interest | |||||
Senior notes | Debt instrument, redemption, period one | Level 3 Financing, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, redemption, description | Also, under certain circumstances in connection with a "change of control" of Level 3 Parent, LLC, it, as well as Level 3 Financing, Inc., will be required to make an offer to repurchase each series of its outstanding senior notes at a price of 101% of the principal amount redeemed, plus accrued and unpaid interest | |||||
Senior notes | 6.5% Notes due 2056 | Qwest Corporation | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, face amount | $ 978 | |||||
Senior notes | 6.5% Notes due 2056 | Debt instrument, redemption, period one | Qwest Corporation | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, redemption, description | on or after September 1, 2021, at a redemption price equal to 100% of the principal amount redeemed | |||||
Senior notes | 7.5% Notes due 2024 | CenturyLink, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, face amount | $ 1,000 | |||||
Senior notes | 7.5% Notes due 2024 | Debt instrument, redemption, period one | CenturyLink, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, redemption, description | on or after January 1, 2024, at a redemption price equal to 100% of the principal amount redeemed | |||||
Senior notes | 7.5% Notes due 2024 | Debt instrument, redemption, period two | CenturyLink, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, redemption, description | before January 1, 2024, the Notes are redeemable, in whole or in part, at CenturyLink, Inc.'s option, at a redemption price equal to the greater of 100% of the principal amount of the Notes to be redeemed or the sum of the present values of the remaining scheduled payments of principal and interest on the Notes to be redeemed, discounted to the redemption date in the manner described in the Notes | |||||
Senior notes | 7.5% Notes due 2024 | Debt instrument, redemption, period three | CenturyLink, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, redemption, description | on or prior to April 1, 2019, CenturyLink, Inc. may redeem up to 35% of the aggregate principal amount of the Notes at a redemption price of 107.5% of the principal amount | |||||
Senior notes | 7.5% Notes due 2024 | Debt instrument, redemption, period four | CenturyLink, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, redemption, description | Under certain circumstances, CenturyLink, Inc. will be required to make an offer to repurchase the Notes at a price of 101% of the aggregate principal amount | |||||
Senior notes | 7.00% Notes due 2056 | Qwest Corporation | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, face amount | $ 235 | |||||
Senior notes | 7.00% Notes due 2056 | Debt instrument, redemption, period one | Qwest Corporation | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, redemption, description | on or after February 1, 2021, at a redemption price equal to 100% of the principal amount redeemed | |||||
Medium-term notes | Qwest Corporation | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | Qwest Corporation must maintain a debt to EBITDA (earnings before interest, taxes, depreciation and amortization, as defined in such term loan) ratio of not more than 2.85:1.0, as of the last day of each fiscal quarter for the four quarters then ended. The term loan also contains a negative pledge covenant, which generally requires Qwest Corporation to secure equally and ratably any advances under the term loan if it pledges assets or permit liens on its property for the benefit of other debtholders | |||||
Medium-term notes | Level 3 Parent, LLC | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | The term loan and senior notes of Level 3 Parent, LLC and Level 3 Financing, Inc. contain extensive affirmative and negative covenants. Such covenants include, among other things and subject to certain significant exceptions, restrictions on their ability to declare or pay dividends, repay certain other indebtedness, create liens, incur additional indebtedness, make investments, engage in transactions with their affiliates, dispose of assets and merge or consolidate with any other person | |||||
Medium-term notes | Level 3 Financing, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | The term loan and senior notes of Level 3 Parent, LLC and Level 3 Financing, Inc. contain extensive affirmative and negative covenants. Such covenants include, among other things and subject to certain significant exceptions, restrictions on their ability to declare or pay dividends, repay certain other indebtedness, create liens, incur additional indebtedness, make investments, engage in transactions with their affiliates, dispose of assets and merge or consolidate with any other person | |||||
Medium-term notes | Term Loan A | CenturyLink Escrow, LLC | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, face amount | $ 1,575 | |||||
Debt instrument, covenant description | With respect to the Term Loan A and A-1 facilities and the 2017 Revolving Credit Facility, the 2017 CenturyLink Credit Agreement requires us to maintain (i) a maximum total leverage ratio of not more than 5.00 to 1.00 between the closing date of the Level 3 acquisition and the second anniversary thereof and 4.75 to 1.00 thereafter and (ii) a minimum consolidated interest coverage ratio of at least 2.00 to 1.00, with such ratios being determined and calculated in the manner described in the 2017 CenturyLink Credit Agreement. | |||||
Medium-term notes | Term Loan A-1 | CenturyLink Escrow, LLC | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, face amount | $ 370 | |||||
Debt instrument, covenant description | With respect to the Term Loan A and A-1 facilities and the 2017 Revolving Credit Facility, the 2017 CenturyLink Credit Agreement requires us to maintain (i) a maximum total leverage ratio of not more than 5.00 to 1.00 between the closing date of the Level 3 acquisition and the second anniversary thereof and 4.75 to 1.00 thereafter and (ii) a minimum consolidated interest coverage ratio of at least 2.00 to 1.00, with such ratios being determined and calculated in the manner described in the 2017 CenturyLink Credit Agreement | |||||
Revolving credit facility | 2017 revolving credit facility | CenturyLink Escrow, LLC | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, covenant description | With respect to the Term Loan A and A-1 facilities and the 2017 Revolving Credit Facility, the 2017 CenturyLink Credit Agreement requires us to maintain (i) a maximum total leverage ratio of not more than 5.00 to 1.00 between the closing date of the Level 3 acquisition and the second anniversary thereof and 4.75 to 1.00 thereafter and (ii) a minimum consolidated interest coverage ratio of at least 2.00 to 1.00, with such ratios being determined and calculated in the manner described in the 2017 CenturyLink Credit Agreement | |||||
Subsequent event | Medium-term notes | Term Loan A | CenturyLink, Inc. | ||||||
Debt Instrument, Redemption [Line Items] | ||||||
Debt instrument, face amount | $ 1,707 |
Long-Term Debt and Credit Fac64
Long-Term Debt and Credit Facilities (Details 4) - USD ($) $ in Millions | 4 Months Ended | ||
Apr. 30, 2018 | Dec. 31, 2017 | ||
Long-term Debt, Fiscal Year Maturity [Abstract] | |||
2,018 | [1] | $ 443 | |
2,019 | [1] | 638 | |
2,020 | [1] | 1,194 | |
2,021 | [1] | 3,109 | |
2,022 | [1] | 5,033 | |
2023 and thereafter | [1] | 27,137 | |
Total long-term debt | 37,554 | ||
Data Centers Financing Obligation | |||
Long-term Debt, Fiscal Year Maturity [Abstract] | |||
Total long-term debt | $ 598 | ||
Data Centers Financing Obligation | Scenario, Forecast | |||
Long-term Debt, Fiscal Year Maturity [Abstract] | |||
Total long-term debt | $ 499 | ||
Future imputed lease income | $ (173) | ||
[1] | The amount outstanding on the data centers obligation at December 31, 2017 was $598 million. The aggregate maturities of long-term debt do not include $499 million of this obligation, which, at the end of the lease term on April 30, 2020, will be derecognized along with the remaining net book value of the associated real estate assets. Also, the aggregate maturities of long-term debt do not include future imputed lease income of $173 million attributable to the accounting for certain of the real estate assets under the failed-sale-leaseback. See Note 3—Sale of Data Centers and Colocation Business for additional information. |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Other receivables | $ 40 | $ 14 | |
Total accounts receivable | 2,721 | 2,195 | |
Less: allowance for doubtful accounts | (164) | (178) | |
Accounts receivable, less allowance | 2,557 | 2,017 | |
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||
Beginning balance | 178 | 152 | $ 162 |
Additions | 176 | 192 | 177 |
Deductions | (190) | (166) | (187) |
Ending balance | 164 | 178 | $ 152 |
Earned and unbilled receivables | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total accounts receivable | 436 | 299 | |
Trade and purchased receivables | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total accounts receivable | $ 2,245 | $ 1,882 |
Property, Plant and Equipment66
Property, Plant and Equipment (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property, plant and equipment | ||||
Asset Retirement Obligation | $ 115 | $ 95 | $ 91 | $ 107 |
Gross property, plant and equipment | 51,204 | 39,194 | ||
Accumulated depreciation | (24,352) | (22,155) | ||
Net property, plant and equipment | 26,852 | 17,039 | ||
Depreciation, Depletion and Amortization [Abstract] | ||||
Depreciation expense | 2,710 | 2,691 | $ 2,836 | |
Land | ||||
Property, plant and equipment | ||||
Gross property, plant and equipment | 883 | 563 | ||
Fiber, conduit and other outside plant(1) | ||||
Property, plant and equipment | ||||
Gross property, plant and equipment | $ 22,798 | 16,996 | ||
Fiber, conduit and other outside plant(1) | Minimum | ||||
Depreciation, Depletion and Amortization [Abstract] | ||||
Depreciable Lives | 15 years | |||
Fiber, conduit and other outside plant(1) | Maximum | ||||
Depreciation, Depletion and Amortization [Abstract] | ||||
Depreciable Lives | 45 years | |||
Central office and other network electronics(2) | ||||
Property, plant and equipment | ||||
Gross property, plant and equipment | $ 18,538 | 13,768 | ||
Central office and other network electronics(2) | Minimum | ||||
Depreciation, Depletion and Amortization [Abstract] | ||||
Depreciable Lives | 3 years | |||
Central office and other network electronics(2) | Maximum | ||||
Depreciation, Depletion and Amortization [Abstract] | ||||
Depreciable Lives | 10 years | |||
Support assets(3) | ||||
Property, plant and equipment | ||||
Gross property, plant and equipment | $ 7,586 | 6,623 | ||
Support assets(3) | Minimum | ||||
Depreciation, Depletion and Amortization [Abstract] | ||||
Depreciable Lives | 3 years | |||
Support assets(3) | Maximum | ||||
Depreciation, Depletion and Amortization [Abstract] | ||||
Depreciable Lives | 30 years | |||
Construction in progress(4) | ||||
Property, plant and equipment | ||||
Gross property, plant and equipment | $ 1,399 | $ 1,244 |
Property, Plant and Equipment67
Property, Plant and Equipment (Details 2) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Asset Retirement Obligation | |||
Balance at beginning of year | $ 95 | $ 91 | $ 107 |
Accretion expense | 6 | 6 | 7 |
Liabilities settled | (3) | (2) | (2) |
Change in estimate | 8 | 0 | 21 |
Balance at end of year | 115 | 95 | 91 |
Colocation Business and Data Centers | |||
Asset Retirement Obligation | |||
Liabilities settled | (20) | 0 | 0 |
Level 3 Communications, Inc. | |||
Asset Retirement Obligation | |||
Liabilities assumed in acquisition of Level 3 | $ 45 | $ 0 | $ 0 |
Severance and Leased Real Est68
Severance and Leased Real Estate (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Severance | ||
Restructuring reserve | ||
Balance at the beginning of the period | $ 98 | $ 14 |
Accrued to expense | 42 | 173 |
Payments, net | (108) | (89) |
Reversals and adjustments | 0 | 0 |
Balance at the end of the period | 33 | 98 |
Leased real estate | ||
Restructuring reserve | ||
Payments, net | (13) | (20) |
Qwest Communications International Inc | Leased real estate | ||
Severance and Leased Real Estate | ||
Current portion of leased real estate accrual | 11 | |
Noncurrent portion of leased real estate accrual | $ 53 | |
Weighted average lease terms (in years) | 6 years 8 months | |
Restructuring reserve | ||
Balance at the beginning of the period | $ 67 | 80 |
Accrued to expense | 4 | 4 |
Reversals and adjustments | 2 | 3 |
Balance at the end of the period | $ 64 | $ 67 |
Qwest Communications International Inc | Leased real estate | Minimum | ||
Severance and Leased Real Estate | ||
Remaining lease terms (in years) | 1 month 27 days | |
Qwest Communications International Inc | Leased real estate | Maximum | ||
Severance and Leased Real Estate | ||
Remaining lease terms (in years) | 7 years 11 months | |
Level 3 Communications, Inc. | Severance | ||
Restructuring reserve | ||
Accrued to expense | $ 1 | |
Level 3 Communications, Inc. | Leased real estate | ||
Restructuring reserve | ||
Accrued to expense | $ 4 |
Employee Benefits (Details)
Employee Benefits (Details) - USD ($) $ in Millions | Jan. 01, 2018 | Jan. 02, 2017 | Jan. 02, 2016 | Jan. 02, 2015 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | Nov. 01, 2017 | Dec. 31, 2016 | Jan. 01, 2015 | |
Employee Benefits | |||||||||||||
Benefit obligation | $ 16,497 | $ 16,714 | $ 16,916 | $ 16,497 | $ 16,714 | $ 16,916 | $ 16,916 | $ 16,497 | $ 16,714 | ||||
Defined Benefit Plan, assumed health care cost trend rates | |||||||||||||
Health care cost trend rate per year description | range from 5.0% to 6.5% in 2018, 5.0% to 7.0% in 2019, 5.0% to 6.5% in 2020 | ||||||||||||
Ultimate health care cost trend rate (as a percent) | 4.50% | 4.50% | 4.50% | 4.50% | 4.50% | ||||||||
Effect of change of 100 basis points in the assumed initial health care cost trend rate | |||||||||||||
Effect on the aggregate of the service and interest cost components of net periodic post-retirement benefit expense (consolidated statements of operations) - Increase | $ 2 | ||||||||||||
Effect on the aggregate of the service and interest cost components of net periodic post-retirement benefit expense (consolidated statements of operations) - Decrease | (2) | ||||||||||||
Effect on benefit obligation (consolidated balance sheet) - Increase | 60 | ||||||||||||
Effect on benefit obligation (consolidated balance sheet) - Decrease | $ (57) | ||||||||||||
Actuarial assumptions at beginning of year: | |||||||||||||
Rate of compensation increase (as a percent) | 3.25% | 3.25% | 3.25% | ||||||||||
Ultimate health care cost trend rate (as a percent) | 4.50% | 4.50% | 4.50% | 4.50% | 4.50% | ||||||||
Year that health care cost rate reaches ultimate trend rate | 2,025 | 2,025 | 2,025 | 2,025 | 2,025 | ||||||||
Components of net periodic benefit (income) expense | |||||||||||||
Expected return on plan assets | $ (668) | $ (739) | |||||||||||
Special termination benefit enhancements | $ 16 | ||||||||||||
Actuarial assumptions at end of year: | |||||||||||||
Rate of compensation increase (as a percent) | 3.25% | 3.25% | |||||||||||
Ultimate health care cost trend rate (as a percent) | 4.50% | 4.50% | 4.50% | 4.50% | 4.50% | ||||||||
Year that health care cost rate reaches ultimate trend rate | 2,025 | 2,025 | 2,025 | 2,025 | 2,025 | ||||||||
Remaining estimated life of pension plan participants, | approximately 9 to 10 years as of December 31, 2017 | ||||||||||||
Change in benefit obligation | |||||||||||||
Benefit obligation at beginning of year | (16,497) | $ (16,714) | $ (16,916) | (16,497) | $ (16,714) | $ (16,916) | |||||||
Benefit obligation at end of year | (16,497) | (16,714) | (16,916) | ||||||||||
Change in plan assets | |||||||||||||
Return on plan assets | $ 1,307 | 759 | |||||||||||
Minimum | |||||||||||||
Actuarial assumptions at beginning of year: | |||||||||||||
Initial health care cost trend rate | 7.00% | 5.00% | 6.00% | ||||||||||
Actuarial assumptions at end of year: | |||||||||||||
Initial health care cost trend rate | 7.00% | 5.00% | |||||||||||
Maximum | |||||||||||||
Actuarial assumptions at beginning of year: | |||||||||||||
Initial health care cost trend rate | 5.00% | 5.25% | 6.50% | ||||||||||
Actuarial assumptions at end of year: | |||||||||||||
Initial health care cost trend rate | 5.00% | 5.50% | |||||||||||
Pension plans | |||||||||||||
Employee Benefits | |||||||||||||
Amortization period of the plan shortfall | 7 years | ||||||||||||
Unfunded status | $ 2,062 | $ 2,409 | |||||||||||
Benefit obligation | 13,122 | $ 13,301 | $ 13,349 | $ 15,042 | 13,122 | $ 13,301 | 13,349 | 15,042 | 13,122 | 13,301 | |||
Fair value of plan assets | 11,060 | $ 10,892 | $ 11,072 | $ 12,571 | 11,060 | 10,892 | 11,072 | 12,571 | 11,060 | $ 10,892 | |||
Employer contributions | 100 | 100 | 100 | ||||||||||
Benefits paid by company | 5 | 7 | 6 | ||||||||||
Estimated future benefit payments: | |||||||||||||
2,018 | 1,031 | ||||||||||||
2,019 | 973 | ||||||||||||
2,020 | 951 | ||||||||||||
2,021 | 929 | ||||||||||||
2,022 | 908 | ||||||||||||
2023 - 2026 | $ 4,170 | ||||||||||||
Actuarial assumptions at beginning of year: | |||||||||||||
Expected long-term rate of return on plan assets (as a percent) | 6.50% | 7.00% | 7.50% | ||||||||||
Components of net periodic benefit (income) expense | |||||||||||||
Service cost | 63 | 64 | 83 | ||||||||||
Interest cost | 411 | 427 | 568 | ||||||||||
Expected return on plan assets | (666) | (732) | (898) | ||||||||||
Recognition of prior service (credit) cost | (8) | (8) | 5 | ||||||||||
Recognition of actuarial loss | 205 | 175 | 161 | ||||||||||
Net periodic pension benefit expense (income) | 5 | (61) | (81) | ||||||||||
Special termination benefit enhancements | 0 | 13 | 0 | ||||||||||
Change in benefit obligation | |||||||||||||
Benefit obligation at beginning of year | (13,122) | $ (13,301) | $ (13,349) | $ (15,042) | (13,122) | (13,301) | (13,349) | (15,042) | |||||
Service cost | 63 | 64 | 83 | ||||||||||
Interest cost | 411 | 427 | 568 | ||||||||||
Plan amendments | 0 | 2 | (100) | ||||||||||
Special termination benefits charge | 0 | 13 | 0 | ||||||||||
Actuarial loss (gain) | 590 | 487 | (800) | ||||||||||
Benefits paid by company | (5) | (7) | (6) | ||||||||||
Benefits paid from plan assets | 1,238 | 1,034 | 1,438 | ||||||||||
Benefit obligation at end of year | (13,122) | (13,301) | (13,349) | ||||||||||
Change in plan assets | |||||||||||||
Fair value of plan assets at beginning of year | 11,060 | $ 10,892 | $ 11,072 | $ 12,571 | 11,060 | 10,892 | 11,072 | 12,571 | |||||
Return on plan assets | 1,306 | 754 | (161) | ||||||||||
Employer contributions | 100 | 100 | 100 | ||||||||||
Benefits paid from plan assets | [1] | 1,238 | 1,034 | 1,438 | |||||||||
Fair value of plan assets at end of year | 11,060 | 10,892 | 11,072 | ||||||||||
Target allocation of plan assets | |||||||||||||
Expected long-term rate of return on plan assets (as a percent) | 6.50% | 7.00% | 7.50% | ||||||||||
Pension plans | Minimum | |||||||||||||
Actuarial assumptions at beginning of year: | |||||||||||||
Discount rate (as a percent) | 3.50% | 3.50% | 3.50% | ||||||||||
Actuarial assumptions at end of year: | |||||||||||||
Discount rate (as a percent) | 3.44% | 3.50% | |||||||||||
Pension plans | Maximum | |||||||||||||
Actuarial assumptions at beginning of year: | |||||||||||||
Discount rate (as a percent) | 4.10% | 4.50% | 4.10% | ||||||||||
Actuarial assumptions at end of year: | |||||||||||||
Discount rate (as a percent) | 3.70% | 4.10% | |||||||||||
Post-Retirement benefit plans | |||||||||||||
Employee Benefits | |||||||||||||
Unfunded status | $ 3,352 | $ 3,360 | |||||||||||
Benefit obligation | 3,375 | $ 3,413 | $ 3,567 | $ 3,830 | 3,375 | 3,413 | 3,567 | 3,830 | 3,375 | 3,413 | |||
Fair value of plan assets | 23 | $ 53 | $ 193 | $ 353 | 23 | 53 | 193 | 353 | 23 | $ 53 | |||
Employer contributions | 0 | 0 | |||||||||||
Benefits paid by company | 298 | 191 | 181 | ||||||||||
Benefits paid, net of participant contributions and direct subsidy receipts | 237 | ||||||||||||
Estimated future benefit payments: | |||||||||||||
2,018 | 293 | ||||||||||||
2,019 | 280 | ||||||||||||
2,020 | 271 | ||||||||||||
2,021 | 262 | ||||||||||||
2,022 | 253 | ||||||||||||
2023 - 2026 | 1,122 | ||||||||||||
Medicare Part D Subsidy Receipts | |||||||||||||
2,018 | (7) | ||||||||||||
2,019 | (7) | ||||||||||||
2,020 | (7) | ||||||||||||
2,021 | (7) | ||||||||||||
2,022 | (7) | ||||||||||||
2023 - 2026 | $ (31) | ||||||||||||
Actuarial assumptions at beginning of year: | |||||||||||||
Discount rate (as a percent) | 3.90% | 4.15% | 3.80% | ||||||||||
Expected long-term rate of return on plan assets (as a percent) | 5.00% | 7.00% | |||||||||||
Components of net periodic benefit (income) expense | |||||||||||||
Service cost | 18 | 19 | 24 | ||||||||||
Interest cost | 100 | 111 | 140 | ||||||||||
Expected return on plan assets | (2) | (7) | (21) | ||||||||||
Recognition of prior service (credit) cost | 20 | 20 | 19 | ||||||||||
Net periodic pension benefit expense (income) | 136 | 146 | 162 | ||||||||||
Special termination benefit enhancements | 0 | 3 | 0 | ||||||||||
Actuarial assumptions at end of year: | |||||||||||||
Discount rate (as a percent) | 3.53% | 3.90% | |||||||||||
Change in benefit obligation | |||||||||||||
Benefit obligation at beginning of year | (3,375) | $ (3,413) | $ (3,567) | $ (3,830) | (3,375) | (3,413) | (3,567) | (3,830) | |||||
Service cost | 18 | 19 | 24 | ||||||||||
Interest cost | 100 | 111 | 140 | ||||||||||
Participant contributions | 54 | 57 | 57 | ||||||||||
Direct subsidy receipts | 7 | 5 | 8 | ||||||||||
Special termination benefits charge | 0 | 3 | 0 | ||||||||||
Actuarial loss (gain) | 112 | (13) | (148) | ||||||||||
Benefits paid by company | (298) | (191) | (181) | ||||||||||
Benefits paid from plan assets | 31 | 145 | 163 | ||||||||||
Benefit obligation at end of year | (3,375) | (3,413) | (3,567) | ||||||||||
Change in plan assets | |||||||||||||
Fair value of plan assets at beginning of year | $ 23 | $ 53 | $ 193 | $ 353 | 23 | 53 | 193 | 353 | |||||
Return on plan assets | 1 | 5 | 3 | ||||||||||
Employer contributions | 0 | 0 | |||||||||||
Benefits paid from plan assets | 31 | 145 | 163 | ||||||||||
Fair value of plan assets at end of year | 23 | 53 | 193 | ||||||||||
Target allocation of plan assets | |||||||||||||
Expected long-term rate of return on plan assets (as a percent) | 5.00% | 7.00% | |||||||||||
Post-Retirement benefit plans | Minimum | |||||||||||||
Actuarial assumptions at beginning of year: | |||||||||||||
Expected long-term rate of return on plan assets (as a percent) | 7.50% | ||||||||||||
Target allocation of plan assets | |||||||||||||
Expected long-term rate of return on plan assets (as a percent) | 7.50% | ||||||||||||
Scenario, Forecast | Post-Retirement benefit plans | |||||||||||||
Employee Benefits | |||||||||||||
Benefits paid, net of participant contributions and direct subsidy receipts | 283 | ||||||||||||
Actuarial assumptions at beginning of year: | |||||||||||||
Expected long-term rate of return on plan assets (as a percent) | 4.00% | ||||||||||||
Target allocation of plan assets | |||||||||||||
Expected long-term rate of return on plan assets (as a percent) | 4.00% | ||||||||||||
Change in accounting method accounted for as a change in estimate | |||||||||||||
Employee Benefits | |||||||||||||
Combined decrease in pension and post-retirement cost | (122) | (149) | |||||||||||
Change from adoption of revised mortality tables | |||||||||||||
Employee Benefits | |||||||||||||
Benefit obligation | $ 113 | $ (268) | $ (379) | 113 | (268) | (379) | (379) | $ 113 | $ (268) | ||||
Change in benefit obligation | |||||||||||||
Benefit obligation at beginning of year | $ (113) | $ 268 | $ 379 | (113) | 268 | 379 | |||||||
Benefit obligation at end of year | (113) | 268 | $ 379 | ||||||||||
Qualified plan | Pension plans | |||||||||||||
Employee Benefits | |||||||||||||
Unfunded status | 2,004 | $ 2,352 | |||||||||||
Employer contributions | 100 | 100 | |||||||||||
Expected employer contribution in 2018 | $ 100 | ||||||||||||
Change in plan assets | |||||||||||||
Employer contributions | 100 | 100 | |||||||||||
Qualified plan | Pension plans | Interest rate sensitive investments | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 45.00% | ||||||||||||
Qualified plan | Pension plans | Investment grade bonds | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 30.00% | ||||||||||||
Qualified plan | Pension plans | High yield and emerging market bonds | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 10.00% | ||||||||||||
Qualified plan | Pension plans | Diversified strategies | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 5.00% | ||||||||||||
Qualified plan | Pension plans | Interest rate investments with higher returns | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 55.00% | ||||||||||||
Qualified plan | Pension plans | U.S. stocks | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 15.00% | ||||||||||||
Qualified plan | Pension plans | Developed market Non-U.S. stocks | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 15.00% | ||||||||||||
Qualified plan | Pension plans | Diversified multi-asset classes | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 7.00% | ||||||||||||
Qualified plan | Pension plans | Other | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 10.00% | ||||||||||||
Qualified plan | Pension plans | Real estate | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 8.00% | ||||||||||||
Qualified plan | Scenario, Forecast | Pension plans | |||||||||||||
Actuarial assumptions at beginning of year: | |||||||||||||
Expected long-term rate of return on plan assets (as a percent) | 7.00% | ||||||||||||
Target allocation of plan assets | |||||||||||||
Expected long-term rate of return on plan assets (as a percent) | 7.00% | ||||||||||||
Expected long-term return on assets, net of administrative expenses | 6.50% | ||||||||||||
Nonqualified plan | Pension plans | |||||||||||||
Employee Benefits | |||||||||||||
Benefits paid by company | 7 | 5 | |||||||||||
Estimated future benefit payments: | |||||||||||||
2,018 | $ 5 | ||||||||||||
Change in benefit obligation | |||||||||||||
Benefits paid by company | (7) | $ (5) | |||||||||||
Level 3 Parent, LLC | Post-Retirement benefit plans | |||||||||||||
Employee Benefits | |||||||||||||
Unfunded status | $ (1) | ||||||||||||
Level 3 Parent, LLC | Qualified plan | Pension plans | |||||||||||||
Employee Benefits | |||||||||||||
Unfunded status | 20 | 20 | |||||||||||
Benefit obligation | $ 167 | 167 | 167 | 167 | 167 | ||||||||
Fair value of plan assets | 147 | 147 | 147 | $ 147 | $ 147 | ||||||||
Components of net periodic benefit (income) expense | |||||||||||||
Net periodic pension benefit expense (income) | 1 | ||||||||||||
Change in benefit obligation | |||||||||||||
Benefit obligation at beginning of year | (167) | (167) | |||||||||||
Benefit obligation at end of year | (167) | ||||||||||||
Change in plan assets | |||||||||||||
Fair value of plan assets at beginning of year | $ 147 | $ 147 | |||||||||||
Fair value of plan assets at end of year | $ 147 | ||||||||||||
CenturyLink, Inc. | Equity and debt securities | |||||||||||||
Target allocation of plan assets | |||||||||||||
Target asset allocation percentage (as a percent) | 10.00% | ||||||||||||
[1] | Non-U.S. stocks represent investments in stocks of companies based in developed countries outside the U.S. as well as commingled funds. The valuation inputs for non-U.S. stocks are based on the last published price reported on the major stock market on which the securities are traded and are primarily classified as Level 1. The commingled funds are valued at NAV based on the market value of the underlying investments using the same valuation inputs previously described. |
Employee Benefits (Details 2)
Employee Benefits (Details 2) - USD ($) $ in Millions | 12 Months Ended | ||||||||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||
Change in plan assets - level 3 inputs | |||||||||||
Actual gains (losses) on pension and post retirement plan assets | $ 1,307 | $ 759 | |||||||||
Expected return | 668 | 739 | |||||||||
Difference between the actual and expected returns on pension and post-retirement plan assets | 639 | 20 | |||||||||
Unfunded Status | |||||||||||
Benefit obligation | $ (16,497) | $ (16,714) | $ (16,916) | ||||||||
Non-current portion of unfunded status | (5,178) | (5,527) | |||||||||
Accumulated other comprehensive (loss) income | |||||||||||
Total | (1,966) | (2,057) | (1,895) | ||||||||
Recognition of Net Periodic Benefits Expense | |||||||||||
Total | (138) | (112) | |||||||||
Deferrals | |||||||||||
Total | (47) | (274) | |||||||||
Net Change in AOCI | |||||||||||
Total | 91 | (162) | |||||||||
Health Care and Life Insurance | |||||||||||
Active health care benefit expenses | 341 | 399 | $ 381 | ||||||||
Participating employees' contribution to health care plan | 128 | 127 | 125 | ||||||||
Pension plans | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 10,892 | 11,072 | 12,571 | 11,060 | 10,892 | 11,072 | $ 12,571 | ||||
Investments valued at NAV | 5,619 | 5,564 | |||||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 10,892 | 11,072 | 12,571 | ||||||||
Fair value of plan assets at end of year | 11,060 | 10,892 | 11,072 | ||||||||
Actual gains (losses) on pension and post retirement plan assets | 1,306 | 754 | (161) | ||||||||
Expected return | 666 | 732 | 898 | ||||||||
Unfunded Status | |||||||||||
Benefit obligation | (13,122) | (13,301) | (13,349) | (15,042) | |||||||
Fair value of plan assets | 10,892 | 11,072 | 12,571 | 11,060 | 10,892 | 11,072 | 12,571 | ||||
Unfunded status | (2,062) | (2,409) | |||||||||
Current portion of unfunded status | (5) | (6) | |||||||||
Non-current portion of unfunded status | (2,057) | (2,403) | |||||||||
Accumulated other comprehensive (loss) income | |||||||||||
Net actuarial (loss) gain | 2,892 | 3,148 | 2,857 | ||||||||
Prior service benefit (cost) | 54 | 62 | 72 | ||||||||
Deferred income tax benefit (expense) | 1,107 | 1,191 | 1,070 | ||||||||
Total | (1,731) | (1,895) | (1,715) | ||||||||
Recognition of Net Periodic Benefits Expense | |||||||||||
Net actuarial (loss) gain | 205 | 175 | |||||||||
Prior service benefit (cost) | (8) | (8) | |||||||||
Deferred income tax benefit (expense) | (72) | (67) | |||||||||
Total | 125 | 100 | |||||||||
Deferrals | |||||||||||
Net actuarial (loss) gain | 51 | (466) | |||||||||
Prior service benefit (cost) | 0 | (2) | |||||||||
Deferred income tax benefit (expense) | (12) | 188 | |||||||||
Total | 39 | (280) | |||||||||
Net Change in AOCI | |||||||||||
Net actuarial (loss) gain | 256 | (291) | |||||||||
Prior service benefit (cost) | (8) | (10) | |||||||||
Defered income tax expense (benefit) | (84) | 121 | |||||||||
Total | 164 | (180) | |||||||||
Estimated recognition of net periodic benefit expense in 2018 | |||||||||||
Net actuarial loss | 205 | ||||||||||
Prior service income (cost) | 8 | ||||||||||
Deferred income tax benefit | 48 | ||||||||||
Estimated net periodic benefit expense to be recorded in 2018 as a component of other comprehensive income (loss) | (149) | ||||||||||
Pension plans | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 11 | 14 | 14 | 27 | 11 | 14 | |||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 11 | 14 | |||||||||
Net transfers | 13 | (2) | |||||||||
Acquisitions | 5 | 1 | |||||||||
Dispositions | (2) | ||||||||||
Fair value of plan assets at end of year | 27 | 11 | 14 | ||||||||
Actual gains (losses) on pension and post retirement plan assets | (2) | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 11 | 14 | 14 | 27 | 11 | 14 | |||||
Pension plans | Exchange-traded U.S. equity futures | |||||||||||
Employee Benefits | |||||||||||
Gross notional exposure | 256 | 104 | |||||||||
Pension plans | Exchange-traded Treasury and other interest rate futures | |||||||||||
Employee Benefits | |||||||||||
Gross notional exposure | 1,830 | 1,813 | |||||||||
Pension plans | Interest rate swaps | |||||||||||
Employee Benefits | |||||||||||
Gross notional exposure | 137 | 260 | |||||||||
Pension plans | Credit default swaps | |||||||||||
Employee Benefits | |||||||||||
Gross notional exposure | 100 | 240 | |||||||||
Pension plans | Equity swap | |||||||||||
Employee Benefits | |||||||||||
Gross notional exposure | 1 | 0 | |||||||||
Pension plans | Foreign exchange forwards | |||||||||||
Employee Benefits | |||||||||||
Gross notional exposure | 293 | 778 | |||||||||
Pension plans | Options | |||||||||||
Employee Benefits | |||||||||||
Gross notional exposure | 259 | 206 | |||||||||
Pension plans | Investment grade bonds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 163 | 106 | |||||||||
Pension plans | High yield bonds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 483 | 521 | |||||||||
Pension plans | High yield bonds | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 11 | 13 | 13 | 7 | 11 | 13 | |||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 11 | 13 | |||||||||
Net transfers | (1) | (2) | |||||||||
Acquisitions | 2 | 1 | |||||||||
Dispositions | (1) | ||||||||||
Fair value of plan assets at end of year | 7 | 11 | 13 | ||||||||
Actual gains (losses) on pension and post retirement plan assets | (5) | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 11 | 13 | 13 | 7 | 11 | 13 | |||||
Pension plans | Emerging market bonds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 14 | 6 | |||||||||
Pension plans | Emerging market bonds | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 1 | 1 | 1 | 0 | 1 | |||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | 1 | |||||||||
Net transfers | 0 | 0 | |||||||||
Acquisitions | 1 | 0 | |||||||||
Dispositions | (1) | ||||||||||
Fair value of plan assets at end of year | 1 | 0 | 1 | ||||||||
Actual gains (losses) on pension and post retirement plan assets | 0 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 1 | 1 | 1 | 0 | 1 | |||||
Pension plans | Diversified strategies | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 538 | 522 | |||||||||
Pension plans | U.S. stocks | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 73 | 58 | |||||||||
Pension plans | U.S. stocks | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 3 | 0 | 0 | |||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | 0 | |||||||||
Net transfers | 0 | 0 | |||||||||
Acquisitions | 0 | 0 | |||||||||
Dispositions | 0 | ||||||||||
Fair value of plan assets at end of year | 3 | 0 | 0 | ||||||||
Actual gains (losses) on pension and post retirement plan assets | 3 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 3 | 0 | 0 | |||||
Pension plans | Non-U.S. stocks | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 627 | 560 | |||||||||
Pension plans | Private debt | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 374 | 369 | |||||||||
Pension plans | Private debt | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 15 | 0 | 0 | |||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | 0 | |||||||||
Net transfers | 14 | 0 | |||||||||
Acquisitions | 1 | 0 | |||||||||
Dispositions | 0 | ||||||||||
Fair value of plan assets at end of year | 15 | 0 | 0 | ||||||||
Actual gains (losses) on pension and post retirement plan assets | 0 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 15 | 0 | 0 | |||||
Pension plans | Multi-asset strategies | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 424 | 412 | |||||||||
Pension plans | Emerging market stocks | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 98 | 76 | |||||||||
Pension plans | Private Equity Funds [Member] | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 460 | 506 | |||||||||
Pension plans | Market Neutral Hedge Funds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 769 | 739 | |||||||||
Pension plans | Directional Hedge Funds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 636 | 657 | |||||||||
Pension plans | Real Estate | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 903 | 926 | |||||||||
Pension plans | Cash equivalents and short-term investment funds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 57 | 106 | |||||||||
Pension plans | Cash equivalents and short-term investment funds | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 1 | 0 | 0 | |||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | 0 | |||||||||
Net transfers | 0 | 0 | |||||||||
Acquisitions | 1 | 0 | |||||||||
Dispositions | 0 | ||||||||||
Fair value of plan assets at end of year | 1 | 0 | 0 | ||||||||
Actual gains (losses) on pension and post retirement plan assets | 0 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 1 | 0 | 0 | |||||
Post-Retirement benefit plans | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 53 | 193 | 353 | 23 | 53 | 193 | 353 | ||||
Investments valued at NAV | 22 | 41 | |||||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 53 | 193 | 353 | ||||||||
Fair value of plan assets at end of year | 23 | 53 | 193 | ||||||||
Actual gains (losses) on pension and post retirement plan assets | 1 | 5 | 3 | ||||||||
Expected return | 2 | 7 | 21 | ||||||||
Unfunded Status | |||||||||||
Benefit obligation | (3,375) | (3,413) | (3,567) | (3,830) | |||||||
Fair value of plan assets | 53 | 193 | $ 353 | 23 | 53 | 193 | $ 353 | ||||
Unfunded status | (3,352) | (3,360) | |||||||||
Current portion of unfunded status | (262) | (236) | |||||||||
Non-current portion of unfunded status | (3,090) | (3,124) | |||||||||
Accumulated other comprehensive (loss) income | |||||||||||
Net actuarial (loss) gain | 250 | 137 | 147 | ||||||||
Prior service benefit (cost) | (107) | (127) | (147) | ||||||||
Deferred income tax benefit (expense) | 122 | 102 | 114 | ||||||||
Total | (235) | (162) | $ (180) | ||||||||
Recognition of Net Periodic Benefits Expense | |||||||||||
Net actuarial (loss) gain | 0 | 0 | |||||||||
Prior service benefit (cost) | 20 | 20 | |||||||||
Deferred income tax benefit (expense) | (7) | (8) | |||||||||
Total | 13 | 12 | |||||||||
Deferrals | |||||||||||
Net actuarial (loss) gain | (113) | 10 | |||||||||
Prior service benefit (cost) | 0 | 0 | |||||||||
Deferred income tax benefit (expense) | 27 | (4) | |||||||||
Total | (86) | 6 | |||||||||
Net Change in AOCI | |||||||||||
Net actuarial (loss) gain | (113) | 10 | |||||||||
Prior service benefit (cost) | 20 | 20 | |||||||||
Defered income tax expense (benefit) | 20 | (12) | |||||||||
Total | (73) | 18 | |||||||||
Estimated recognition of net periodic benefit expense in 2018 | |||||||||||
Net actuarial loss | 0 | ||||||||||
Prior service income (cost) | (20) | ||||||||||
Deferred income tax benefit | 4 | ||||||||||
Estimated net periodic benefit expense to be recorded in 2018 as a component of other comprehensive income (loss) | (16) | ||||||||||
Post-Retirement benefit plans | Investment grade bonds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 0 | 0 | |||||||||
Post-Retirement benefit plans | High yield bonds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 0 | 1 | |||||||||
Post-Retirement benefit plans | Emerging market bonds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 0 | 0 | |||||||||
Post-Retirement benefit plans | Diversified strategies | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 0 | 1 | |||||||||
Post-Retirement benefit plans | U.S. stocks | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 0 | 0 | |||||||||
Post-Retirement benefit plans | Non-U.S. stocks | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 0 | 1 | |||||||||
Post-Retirement benefit plans | Private debt | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 1 | 1 | |||||||||
Post-Retirement benefit plans | Multi-asset strategies | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 0 | 0 | |||||||||
Post-Retirement benefit plans | Emerging market stocks | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 0 | 0 | |||||||||
Post-Retirement benefit plans | Private Equity Funds [Member] | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 10 | 14 | |||||||||
Post-Retirement benefit plans | Market Neutral Hedge Funds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 0 | 1 | |||||||||
Post-Retirement benefit plans | Directional Hedge Funds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 0 | 1 | |||||||||
Post-Retirement benefit plans | Real Estate | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 1 | 8 | |||||||||
Post-Retirement benefit plans | Cash equivalents and short-term investment funds | |||||||||||
Employee Benefits | |||||||||||
Investments valued at NAV | 10 | 13 | |||||||||
Qualified plan | Pension plans | |||||||||||
Unfunded Status | |||||||||||
Unfunded status | (2,004) | (2,352) | |||||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 5,328 | 5,328 | 5,441 | 5,328 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 5,328 | ||||||||||
Fair value of plan assets at end of year | 5,441 | 5,328 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 5,328 | 5,328 | 5,441 | 5,328 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 2,895 | 2,895 | 2,827 | 2,895 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 2,895 | ||||||||||
Fair value of plan assets at end of year | 2,827 | 2,895 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 2,895 | 2,895 | 2,827 | 2,895 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 2,422 | 2,422 | 2,587 | 2,422 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 2,422 | ||||||||||
Fair value of plan assets at end of year | 2,587 | 2,422 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 2,422 | 2,422 | 2,587 | 2,422 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 11 | 11 | 27 | 11 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 11 | ||||||||||
Fair value of plan assets at end of year | 27 | 11 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 11 | 11 | 27 | 11 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Investment grade bonds | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1,824 | [1] | 1,824 | [1] | 1,747 | 1,824 | [1] | ||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | [1] | 1,824 | |||||||||
Fair value of plan assets at end of year | 1,747 | 1,824 | [1] | ||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1,824 | [1] | 1,824 | [1] | 1,747 | 1,824 | [1] | ||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Investment grade bonds | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 420 | 420 | 432 | 420 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 420 | ||||||||||
Fair value of plan assets at end of year | 432 | 420 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 420 | 420 | 432 | 420 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Investment grade bonds | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1,404 | 1,404 | 1,315 | 1,404 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 1,404 | ||||||||||
Fair value of plan assets at end of year | 1,315 | 1,404 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1,404 | 1,404 | 1,315 | 1,404 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Investment grade bonds | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | High yield bonds | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 615 | [2] | 615 | [2] | 582 | 615 | [2] | ||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | [2] | 615 | |||||||||
Fair value of plan assets at end of year | 582 | 615 | [2] | ||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 615 | [2] | 615 | [2] | 582 | 615 | [2] | ||||
Fair Value, Measurements, Recurring [Member] | Pension plans | High yield bonds | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 7 | 7 | 0 | 7 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 7 | ||||||||||
Fair value of plan assets at end of year | 0 | 7 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 7 | 7 | 0 | 7 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | High yield bonds | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 597 | 597 | 575 | 597 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 597 | ||||||||||
Fair value of plan assets at end of year | 575 | 597 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 597 | 597 | 575 | 597 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | High yield bonds | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 11 | 11 | 7 | 11 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 11 | ||||||||||
Fair value of plan assets at end of year | 7 | 11 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 11 | 11 | 7 | 11 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Emerging market bonds | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 424 | [3] | 424 | [3] | 437 | 424 | [3] | ||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | [3] | 424 | |||||||||
Fair value of plan assets at end of year | 437 | 424 | [3] | ||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 424 | [3] | 424 | [3] | 437 | 424 | [3] | ||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Emerging market bonds | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 212 | 212 | 217 | 212 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 212 | ||||||||||
Fair value of plan assets at end of year | 217 | 212 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 212 | 212 | 217 | 212 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Emerging market bonds | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 212 | 212 | 219 | 212 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 212 | ||||||||||
Fair value of plan assets at end of year | 219 | 212 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 212 | 212 | 219 | 212 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Emerging market bonds | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 1 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 1 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 1 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | U.S. stocks | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1,147 | [4] | 1,147 | [4] | 1,035 | 1,147 | [4] | ||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | [4] | 1,147 | |||||||||
Fair value of plan assets at end of year | 1,035 | 1,147 | [4] | ||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1,147 | [4] | 1,147 | [4] | 1,035 | 1,147 | [4] | ||||
Fair Value, Measurements, Recurring [Member] | Pension plans | U.S. stocks | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1,146 | 1,146 | 1,030 | 1,146 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 1,146 | ||||||||||
Fair value of plan assets at end of year | 1,030 | 1,146 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1,146 | 1,146 | 1,030 | 1,146 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | U.S. stocks | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1 | 1 | 2 | 1 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 1 | ||||||||||
Fair value of plan assets at end of year | 2 | 1 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1 | 1 | 2 | 1 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | U.S. stocks | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 3 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 3 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 3 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Non-U.S. stocks | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 722 | [5] | 722 | [5] | 706 | 722 | [5] | ||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | [5] | 722 | |||||||||
Fair value of plan assets at end of year | 706 | 722 | [5] | ||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 722 | [5] | 722 | [5] | 706 | 722 | [5] | ||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Non-U.S. stocks | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 721 | 721 | 706 | 721 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 721 | ||||||||||
Fair value of plan assets at end of year | 706 | 721 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 721 | 721 | 706 | 721 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Non-U.S. stocks | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 1 | ||||||||||
Fair value of plan assets at end of year | 0 | 1 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Non-U.S. stocks | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Private debt | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 15 | 15 | |||||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at end of year | 15 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 15 | 15 | |||||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Private debt | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at end of year | 0 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Private debt | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at end of year | 0 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Private debt | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 15 | 15 | |||||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at end of year | 15 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 15 | 15 | |||||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Multi-asset strategies | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 389 | 389 | 440 | 389 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 389 | ||||||||||
Fair value of plan assets at end of year | 440 | 389 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 389 | 389 | 440 | 389 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Multi-asset strategies | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 389 | 389 | 440 | 389 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 389 | ||||||||||
Fair value of plan assets at end of year | 440 | 389 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 389 | 389 | 440 | 389 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Multi-asset strategies | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Multi-asset strategies | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Derivative [Member] | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 2 | 2 | |||||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at end of year | 2 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 2 | 2 | |||||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Derivative [Member] | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 2 | 2 | |||||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at end of year | 2 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 2 | 2 | |||||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Derivative [Member] | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at end of year | 0 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Derivative [Member] | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at end of year | 0 | ||||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Cash equivalents and short-term investment funds | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 207 | [6] | 207 | [6] | 477 | 207 | [6] | ||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | [6] | 207 | |||||||||
Fair value of plan assets at end of year | 477 | 207 | [6] | ||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 207 | [6] | 207 | [6] | 477 | 207 | [6] | ||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Cash equivalents and short-term investment funds | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Cash equivalents and short-term investment funds | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 207 | 207 | 476 | 207 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 207 | ||||||||||
Fair value of plan assets at end of year | 476 | 207 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 207 | 207 | 476 | 207 | |||||||
Fair Value, Measurements, Recurring [Member] | Pension plans | Cash equivalents and short-term investment funds | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 1 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 1 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 1 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 12 | 12 | 1 | 12 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 12 | ||||||||||
Fair value of plan assets at end of year | 1 | 12 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 12 | 12 | 1 | 12 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 4 | 4 | 1 | 4 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 4 | ||||||||||
Fair value of plan assets at end of year | 1 | 4 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 4 | 4 | 1 | 4 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 8 | 8 | 0 | 8 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 8 | ||||||||||
Fair value of plan assets at end of year | 0 | 8 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 8 | 8 | 0 | 8 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Investment grade bonds | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 3 | 3 | 0 | 3 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 3 | ||||||||||
Fair value of plan assets at end of year | 0 | 3 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 3 | 3 | 0 | 3 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Investment grade bonds | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 1 | ||||||||||
Fair value of plan assets at end of year | 0 | 1 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Investment grade bonds | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 2 | 2 | 0 | 2 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 2 | ||||||||||
Fair value of plan assets at end of year | 0 | 2 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 2 | 2 | 0 | 2 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Investment grade bonds | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | High yield bonds | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 1 | ||||||||||
Fair value of plan assets at end of year | 0 | 1 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | High yield bonds | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | High yield bonds | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 1 | ||||||||||
Fair value of plan assets at end of year | 0 | 1 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | High yield bonds | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | U.S. stocks | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 2 | 2 | 1 | 2 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 2 | ||||||||||
Fair value of plan assets at end of year | 1 | 2 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 2 | 2 | 1 | 2 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | U.S. stocks | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 2 | 2 | 1 | 2 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 2 | ||||||||||
Fair value of plan assets at end of year | 1 | 2 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 2 | 2 | 1 | 2 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | U.S. stocks | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | U.S. stocks | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Non-U.S. stocks | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 1 | ||||||||||
Fair value of plan assets at end of year | 0 | 1 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Non-U.S. stocks | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 1 | ||||||||||
Fair value of plan assets at end of year | 0 | 1 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 1 | 1 | 0 | 1 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Non-U.S. stocks | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Non-U.S. stocks | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Cash equivalents and short-term investment funds | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 5 | 5 | 0 | 5 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 5 | ||||||||||
Fair value of plan assets at end of year | 0 | 5 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 5 | 5 | 0 | 5 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Cash equivalents and short-term investment funds | Level 1 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Cash equivalents and short-term investment funds | Level 2 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 5 | 5 | 0 | 5 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 5 | ||||||||||
Fair value of plan assets at end of year | 0 | 5 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | 5 | 5 | 0 | 5 | |||||||
Fair Value, Measurements, Recurring [Member] | Post-Retirement benefit plans | Cash equivalents and short-term investment funds | Level 3 | |||||||||||
Employee Benefits | |||||||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | |||||||
Change in plan assets - level 3 inputs | |||||||||||
Fair value of plan assets at beginning of year | 0 | ||||||||||
Fair value of plan assets at end of year | 0 | 0 | |||||||||
Unfunded Status | |||||||||||
Fair value of plan assets | $ 0 | $ 0 | $ 0 | $ 0 | |||||||
[1] | Investment grade bonds represent investments in fixed income securities as well as commingled bond funds comprised of U.S. Treasury securities, agencies, corporate bonds, mortgage-backed securities, asset-backed securities and commercial mortgage-backed securities. Treasury securities are valued at the bid price reported in the active market in which the security is traded and are classified as Level 1. The valuation inputs of other investment grade bonds primarily utilize observable market information and are based on a spread to U.S. Treasury securities and consider yields available on comparable securities of issuers with similar credit ratings. The primary observable inputs include references to the new issue market for similar securities, the secondary trading markets and dealer quotes. Option adjusted spread models are utilized to evaluate securities such as asset backed securities that have early redemption features. These securities are classified as Level 2. The commingled funds are valued at NAV based on the market value of the underlying fixed income securities using the same valuation inputs previously described. | ||||||||||
[2] | High yield bonds represent investments in below investment grade fixed income securities as well as commingled high yield bond funds. The valuation inputs for the securities primarily utilize observable market information and are based on a spread to U.S. Treasury securities and consider yields available on comparable securities of issuers with similar credit ratings. These securities are primarily classified as Level 2. Securities whose valuation inputs are not based on observable market information are classified as Level 3. The commingled funds are valued at NAV based on the market value of the underlying high yield instruments using the same valuation inputs previously described. | ||||||||||
[3] | Emerging market bonds represent investments in securities issued by governments and other entities located in developing countries as well as registered mutual funds and commingled emerging market bond funds. The valuation inputs for the securities utilize observable market information and are primarily based on dealer quotes or a spread relative to the local government bonds. The registered mutual fund is classified as Level 1 while individual securities are primarily classified as Level 2. Securities whose valuation inputs are not based on observable market information are classified as Level 3. The commingled funds are valued at NAV based on the market value of the underlying emerging market bonds using the same valuation inputs previously described. | ||||||||||
[4] | U.S. stocks represent investments in stocks of U.S. based companies as well as commingled U.S. stock funds. The valuation inputs for U.S. stocks are based on the last published price reported on the major stock market on which the securities are traded and are primarily classified as Level 1. Securities whose valuation inputs are not based on observable market information are classified as Level 3. The commingled funds are valued at NAV based on the market value of the underlying investments using the same valuation inputs previously described. | ||||||||||
[5] | Non-U.S. stocks represent investments in stocks of companies based in developed countries outside the U.S. as well as commingled funds. The valuation inputs for non-U.S. stocks are based on the last published price reported on the major stock market on which the securities are traded and are primarily classified as Level 1. The commingled funds are valued at NAV based on the market value of the underlying investments using the same valuation inputs previously described. | ||||||||||
[6] | Cash equivalents and short-term investments represent investments that are used in conjunction with derivatives positions or are used to provide liquidity for the payment of benefits or other purposes. The valuation inputs of securities are based on a spread to U.S. Treasury Bills, the Federal Funds Rate, or London Interbank Offered Rate and consider yields available on comparable securities of issuers with similar credit ratings and are primarily classified as Level 2. The commingled funds are valued at NAV based on the market value of the underlying investments using the same valuation inputs described above. |
Employee Benefits (Details 3)
Employee Benefits (Details 3) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Defined Contribution Plan [Abstract] | |||
CenturyLink, Inc. common stock included in the assets of the Defined Contribution Plan (in shares) | 7 | 7 | |
Expenses related to the 401(k) Plan | $ 77 | $ 79 | $ 83 |
Share-based Compensation (Detai
Share-based Compensation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | Dec. 31, 2017 | Nov. 02, 2017 | Nov. 01, 2017 | Mar. 31, 2017 | Mar. 31, 2016 | Mar. 30, 2015 | Dec. 31, 2017 | Dec. 31, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Mar. 31, 2016 | Sep. 30, 2015 | Mar. 31, 2015 | Sep. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Oct. 31, 2017 |
Share-based compensation, aggregate disclosures | ||||||||||||||||||
Compensation cost | $ 111 | $ 80 | $ 73 | |||||||||||||||
Tax benefit recognized in the income statement for share-based payment arrangements | 28 | $ 31 | 28 | |||||||||||||||
Unrecognized compensation cost | $ 240 | $ 240 | $ 240 | $ 240 | ||||||||||||||
Weighted-average recognition period | 1 year 11 months | |||||||||||||||||
Stock options | ||||||||||||||||||
Share-based compensation | ||||||||||||||||||
Option expiration term (in years) | 10 years | |||||||||||||||||
Summary of stock options activity | ||||||||||||||||||
Outstanding at December 31, 2016 | 3,008 | 3,008 | ||||||||||||||||
Exercised | (12) | |||||||||||||||||
Forfeited/Expired | (1,974) | |||||||||||||||||
Outstanding at December 31, 2017 | 1,022 | 1,022 | 1,022 | 1,022 | 3,008 | |||||||||||||
Exercisable at December 31 | 1,023 | 1,023 | 1,023 | 1,023 | 3,008 | |||||||||||||
Summary of stock options weighted-average exercise price activity | ||||||||||||||||||
Exercised (in dollars per share) | $ 10.75 | |||||||||||||||||
Forfeited/Expired (in dollars per share) | 46.82 | |||||||||||||||||
Outstanding at December 31, 2017 (in dollars per share) | $ 40.08 | |||||||||||||||||
Exercisable at December 31 (in dollars per share) | $ 27.41 | $ 27.41 | $ 27.41 | $ 27.41 | $ 40.08 | |||||||||||||
Stock options additional disclosures | ||||||||||||||||||
Outstanding at the end of the period, intrinsic value | $ 1 | $ 1 | $ 1 | $ 1 | ||||||||||||||
Exercisable at the end of the period, intrinsic value | $ 1 | $ 1 | $ 1 | $ 1 | ||||||||||||||
Outstanding options weighted-average remaining contractual term | 1 year 5 months 10 days | |||||||||||||||||
Exercisable options weighted- average remaining contractual term | 1 year 5 months 10 days | |||||||||||||||||
Net cash proceeds received in connection with option exercises (less than $1 million) | $ 1 | |||||||||||||||||
Tax benefit realized from option exercises (less than $1 million) | 1 | |||||||||||||||||
Total intrinsic value of options exercised (less than $1 million) | $ 1 | $ 1 | $ 4 | |||||||||||||||
Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Nonvested at the beginning of the period (in shares) | 5,948 | 5,948 | ||||||||||||||||
Granted (in shares) | 1,100 | 2,000 | 1,900 | 948 | 894 | 784 | 766 | 496 | 5,223 | 3,600 | ||||||||
Vested (in shares) | (2,762) | |||||||||||||||||
Forfeited (in shares) | (1,165) | |||||||||||||||||
Nonvested at the end of the period (in shares) | 19,774 | 19,774 | 19,774 | 19,774 | 5,948 | |||||||||||||
Weighted-Average Grant Date Fair Value | ||||||||||||||||||
Nonvested at the beginning of the period (in dollars per share) | $ 31.89 | $ 31.89 | ||||||||||||||||
Granted (in dollars per share) | 22.02 | $ 30.83 | $ 31.83 | |||||||||||||||
Vested (in dollars per share) | 28.55 | |||||||||||||||||
Forfeited (in dollars per share) | 26.43 | |||||||||||||||||
Nonvested at the end of the period (in dollars per share) | $ 21.90 | $ 21.90 | $ 21.90 | $ 21.90 | $ 31.89 | |||||||||||||
Total fair value of awards vested during the period | $ 60 | $ 47 | $ 59 | |||||||||||||||
Restricted Stock | Minimum | ||||||||||||||||||
Restricted stock awards | ||||||||||||||||||
Percentage of target award (as a percent) | 0.00% | |||||||||||||||||
Restricted Stock | Maximum | ||||||||||||||||||
Restricted stock awards | ||||||||||||||||||
Percentage of target award (as a percent) | 200.00% | |||||||||||||||||
Service conditions | Restricted Stock | ||||||||||||||||||
Share-based compensation | ||||||||||||||||||
Vesting period | 3 years | 3 years | ||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 493 | 4,700 | 3,100 | 2,600 | ||||||||||||||
Service conditions | Restricted Stock | Minimum | ||||||||||||||||||
Share-based compensation | ||||||||||||||||||
Vesting period | 3 years | 3 years | 1 year | |||||||||||||||
Service conditions | Restricted Stock | Maximum | ||||||||||||||||||
Share-based compensation | ||||||||||||||||||
Vesting period | 7 years | 7 years | 2 years | |||||||||||||||
Services conditions and either market or performance conditions | Restricted Stock | ||||||||||||||||||
Share-based compensation | ||||||||||||||||||
Vesting period | 3 years | |||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 1,300 | 700 | 300 | |||||||||||||||
Target number of shares | Restricted Stock | Minimum | ||||||||||||||||||
Restricted stock awards | ||||||||||||||||||
Percentage of target award (as a percent) | 80.00% | |||||||||||||||||
Target number of shares | Restricted Stock | Maximum | ||||||||||||||||||
Restricted stock awards | ||||||||||||||||||
Percentage of target award (as a percent) | 120.00% | |||||||||||||||||
Service conditions, performance conditions or target number of shares | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 6,000 | 3,800 | 2,900 | |||||||||||||||
Level 3 Communications, Inc. | ||||||||||||||||||
Share-based compensation | ||||||||||||||||||
Price per share of stock in business acquisition (per share) | $ 26.50 | |||||||||||||||||
Level 3 Communications, Inc. | Restricted Stock Units (RSUs) | ||||||||||||||||||
Share-based compensation | ||||||||||||||||||
Preliminary aggregate fair value of Level 3 RSUs at acquisition | $ 239 | |||||||||||||||||
Nonvested Continuing RSUs compensation not yet recognized | $ 137 | $ 137 | $ 137 | $ 137 | ||||||||||||||
Weighted-Average Grant Date Fair Value | ||||||||||||||||||
Total fair value of awards vested during the period | $ 103 | |||||||||||||||||
Level 3 Communications, Inc. | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Level 3 replacement awards (in shares) | 12,530 | |||||||||||||||||
Weighted-Average Grant Date Fair Value | ||||||||||||||||||
Level 3 replacement awards (in dollars per share) | $ 18.99 | |||||||||||||||||
Level 3 Communications, Inc. | Common Stock | ||||||||||||||||||
Share-based compensation | ||||||||||||||||||
Stock per share issuable in business acquisition, Description | 1.4286 shares of our common stock | 1.4286 shares of CenturyLink common stock | ||||||||||||||||
Weighted-Average Grant Date Fair Value | ||||||||||||||||||
Level 3 replacement awards (in dollars per share) | $ 18.99 | |||||||||||||||||
Level 3 Communications, Inc. | Common Stock | Restricted Stock Units (RSUs) | ||||||||||||||||||
Share-based compensation | ||||||||||||||||||
Stock per share issuable in business acquisition, Description | each outstanding Level 3 restricted stock unit award granted on or after April 1, 2014 (other than these granted to outside directors of Level 3) was converted into a CenturyLink restricted stock unit award using a conversion ratio of 2.8386 to 1 as determined in accordance with a formula set forth in the merger agreement (the "Continuing RSU Awards") | Each outstanding Level 3 restricted stock unit award granted on or after April 1, 2014 (other than those granted to outside directors of Level 3) was converted into a CenturyLink restricted stock unit award using a conversion ratio of 2.8386 to 1 as determined in accordance with a formula set forth in the merger agreement (“the Continuing RSU Awards”) | ||||||||||||||||
Awards vesting equally on February 21, 2018, 2019 and 2020 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Description | 314 | |||||||||||||||||
Awards vesting on February 21, 2020 | Services conditions and either market or performance conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 470 | |||||||||||||||||
Awards vesting equally on February 20, 2018, 2019 and 2020 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 1,800 | |||||||||||||||||
Awards vesting on February 20, 2020 | Services conditions and either market or performance conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 200 | |||||||||||||||||
Awards vesting on June 1, 2018, 2019 and 2020 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 647 | |||||||||||||||||
Awards vesting on December 15, 2018 and 2019 | Services conditions and either market or performance conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 125 | |||||||||||||||||
Awards vesting on December 15, 2018 | Target number of shares | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 122 | |||||||||||||||||
Awards vesting on March 31, 2019 and November 1, 2020 | Services conditions and either market or performance conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 455 | |||||||||||||||||
Awards vesting on November 1, 2019 and 2020 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 911 | |||||||||||||||||
Awards vesting on November 1, 2018, 2019 and 2020 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 187 | |||||||||||||||||
Awards vesting equally on February 23, 2017, 2018 and 2019 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 306 | |||||||||||||||||
Awards vesting on February 23, 2019 | Services conditions and either market or performance conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 460 | |||||||||||||||||
Awards vesting equally on February 25, 2017, 2018, and 2019 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 1,700 | |||||||||||||||||
Awards vesting on February 25, 2019 | Services conditions and either market or performance conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 200 | |||||||||||||||||
Awards vesting on August 16, 2019 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 113 | |||||||||||||||||
Awards vesting on August 16, 2021 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 322 | |||||||||||||||||
Awards vesting on August 16, 2023 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 209 | |||||||||||||||||
Awards vesting on January 13, 2021 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 22 | |||||||||||||||||
Awards vesting on January 13, 2023 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 22 | |||||||||||||||||
Awards vesting equally on February 23, 2016, 2017 and 2018 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 198 | |||||||||||||||||
Awards vesting on February 23, 2018 | Services conditions and either market or performance conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 298 | |||||||||||||||||
Awards vesting equally on March 12, 2016, 2017 and 2018 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 1,200 | |||||||||||||||||
Awards vesting on August 14, 2018 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 193 | |||||||||||||||||
Awards vesting on August 14, 2020 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 423 | |||||||||||||||||
Awards vesting on August 14, 2022 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 230 | |||||||||||||||||
Awards vesting equally on August 14, 2017, 2019 and 2021 | Service conditions | Restricted Stock | ||||||||||||||||||
Summary of restricted stock and restricted stock unit activity | ||||||||||||||||||
Granted (in shares) | 55 |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income (Numerator): | |||||||||||
Net income | $ 1,117 | $ 92 | $ 17 | $ 163 | $ 42 | $ 152 | $ 196 | $ 236 | $ 1,389 | $ 626 | $ 878 |
Earnings applicable to non-vested restricted stock | 0 | 0 | 0 | ||||||||
Net income applicable to common stock for computing basic earnings per common share | 1,389 | 626 | 878 | ||||||||
Net income as adjusted for purposes of computing diluted earnings per common share | $ 1,389 | $ 626 | $ 878 | ||||||||
Weighted average number of shares: | |||||||||||
Outstanding during period (in shares) | 635,576 | 545,946 | 559,260 | ||||||||
Non-vested restricted stock (in shares) | (7,768) | (6,397) | (4,982) | ||||||||
Weighted average shares outstanding for computing basic earnings per common share (in shares) | 627,808 | 539,549 | 554,278 | ||||||||
Incremental common shares attributable to dilutive securities: | |||||||||||
Shares issuable under convertible securities (in shares) | 10 | 10 | 10 | ||||||||
Shares issuable under incentive compensation plans (in shares) | 875 | 1,120 | 805 | ||||||||
Number of shares as adjusted for purposes of computing diluted earnings per common share (in shares) | 628,693 | 540,679 | 555,093 | ||||||||
Basic earnings per common share (in dollars per share) | $ 1.26 | $ 0.17 | $ 0.03 | $ 0.30 | $ 0.08 | $ 0.28 | $ 0.36 | $ 0.44 | $ 2.21 | $ 1.16 | $ 1.58 |
Diluted earnings per common share (in dollars per share) | $ 1.26 | $ 0.17 | $ 0.03 | $ 0.30 | $ 0.08 | $ 0.28 | $ 0.36 | $ 0.44 | $ 2.21 | $ 1.16 | $ 1.58 |
Number of shares of common stock excluded from the computation of diluted earnings per share | 4,700 | 3,300 | 3,100 |
Fair Value Disclosure (Details)
Fair Value Disclosure (Details) - Fair value measurements determined on a nonrecurring basis - Fair value, Input Level 2 - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Carrying amount | ||
Liabilities | ||
Liabilities-Long-term debt, excluding capital lease and other obligations | $ 36,835 | $ 19,553 |
Fair value amount | ||
Liabilities | ||
Liabilities-Long-term debt, excluding capital lease and other obligations | $ 36,402 | $ 19,639 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Federal | ||||
Current | $ 82 | $ 335 | $ 28 | |
Deferred | (988) | 5 | 329 | |
State | ||||
Current | 21 | 27 | 40 | |
Deferred | 16 | 8 | 21 | |
Foreign | ||||
Current | 22 | 26 | 16 | |
Deferred | (2) | (7) | 4 | |
Total income tax expense | (849) | 394 | 438 | |
Income tax expense allocation | ||||
Attributable to income | (849) | 394 | 438 | |
Stockholders' equity: | ||||
Compensation expense for tax purposes in excess of amounts recognized for financial reporting purposes | 0 | (2) | (5) | |
Tax effect of the change in accumulated other comprehensive loss | $ 81 | $ (109) | $ 59 | |
Reconciliation of the statutory federal income tax rate to effective income tax rate | ||||
Statutory federal income tax rate (as a percent) | 35.00% | 35.00% | 35.00% | 35.00% |
Federal income tax rate after enactment of Tax Reform (percentage) | 21.00% | |||
State income taxes, net of federal income tax benefit (as a percent) | 3.90% | 2.30% | 2.60% | |
Change in liability for unrecognized tax position (as a percent) | 1.00% | 0.20% | 0.40% | |
Tax reform (as a percent) | (209.80%) | (0.00%) | (0.00%) | |
Net foreign income taxes (as a percent) | (0.70%) | 0.10% | 0.70% | |
Foreign dividend paid to a domestic parent company (as a percent) | 0.20% | 1.80% | 0.00% | |
Affiliate debt rationalization, (as a percent) | (0.00%) | (0.00%) | (2.60%) | |
Research and development credits (as a percent) | (1.40%) | (0.60%) | (2.10%) | |
Tax impact on sale of data centers and colocation business, (as a percent) | 5.00% | 0.00% | 0.00% | |
Level 3 acquisition transaction costs, (as a percent) | 6.00% | 0.00% | 0.00% | |
Other, net (as a percent) | 3.60% | (0.20%) | (0.70%) | |
Effective income tax rate (as a percent) | (157.20%) | 38.60% | 33.30% | |
Provisional tax benefit, amount | $ 1,100 | |||
Tax expense related to sale of colocation business | $ 27 | |||
Transaction costs | 32 | |||
Foreign dividend paid to a domestic parent company | $ 18 | |||
Affiliate debt rationalization | $ 34 | |||
Research and development credits | 28 | |||
Changes affecting state income taxes | 16 | |||
Deferred tax assets | ||||
Post-retirement and pension benefit costs | 1,321 | 1,321 | 2,175 | |
Net operating loss carryforwards | 3,951 | 3,951 | 473 | |
Other employee benefits | 112 | 112 | 125 | |
Other | 714 | 714 | 342 | |
Gross deferred tax assets | 6,098 | 6,098 | 3,115 | |
Less valuation allowance | (1,341) | (1,341) | (375) | |
Net deferred tax assets | 4,757 | 4,757 | 2,740 | |
Deferred tax liabilities | ||||
Property, plant and equipment, primarily due to depreciation differences | (2,935) | (2,935) | (3,626) | |
Goodwill and other intangible assets | (3,785) | (3,785) | (2,577) | |
Other | (16) | (16) | 0 | |
Gross deferred tax liabilities | (6,736) | (6,736) | (6,203) | |
Net deferred tax liabilities | 1,979 | 1,979 | 3,463 | |
Long-term deferred tax liability, net | 2,413 | 2,413 | 3,471 | |
Noncurrent deferred tax asset, net | 434 | 434 | 8 | |
Summary of reconciliation of the change in gross unrecognized tax benefits activity | ||||
Unrecognized tax benefits at beginning of year | 16 | 15 | ||
Assumed in the acquisition of Level 3 | 18 | 0 | ||
Tax position of prior periods netted against deferred tax assets assumed in the acquisition of Level 3 | 2 | 0 | ||
Increase in tax positions taken in the current year | 1 | 1 | ||
Increase in tax positions taken in the prior year | 3 | 0 | ||
Unrecognized tax benefits at end of year | 40 | 40 | 16 | $ 15 |
Unrecognized tax benefits that would impact effective tax rate | 66 | 66 | 34 | |
Interest on income taxes accrued | 56 | 56 | $ 35 | |
Significant change in unrecorded benefit | 16 | 16 | ||
Federal | ||||
NOLs | ||||
Operating loss carryforward | 9,100 | 9,100 | ||
State | ||||
NOLs | ||||
Operating loss carryforward | 21,000 | 21,000 | ||
Foreign | ||||
NOLs | ||||
Operating loss carryforward | $ 5,800 | $ 5,800 |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income taxes | ||
Valuation allowance | $ 1,341 | $ 375 |
Deferred tax asset valuation allowance adjustment | $ 966 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||||||||||
Number of reportable segments (segments) | 2 | ||||||||||
OPERATING REVENUES | $ 5,323 | $ 4,034 | $ 4,090 | $ 4,209 | $ 4,289 | $ 4,382 | $ 4,398 | $ 4,401 | $ 17,656 | $ 17,470 | $ 17,900 |
Expenses | 15,647 | 15,137 | 15,321 | ||||||||
OPERATING INCOME | $ 524 | $ 487 | $ 367 | $ 631 | $ 405 | $ 593 | $ 647 | $ 688 | 2,009 | 2,333 | 2,579 |
Operating segments (segments) | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
OPERATING REVENUES | 16,924 | 16,766 | 17,171 | ||||||||
Expenses | 9,390 | 9,081 | 9,025 | ||||||||
OPERATING INCOME | $ 7,534 | $ 7,685 | $ 8,146 | ||||||||
Margin percentage (percent) | 45.00% | 46.00% | 47.00% | ||||||||
Business | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
OPERATING REVENUES | $ 11,220 | $ 10,704 | $ 10,977 | ||||||||
Expenses | 6,847 | 6,391 | 6,395 | ||||||||
OPERATING INCOME | $ 4,373 | $ 4,313 | $ 4,582 | ||||||||
Margin percentage (percent) | 39.00% | 40.00% | 42.00% | ||||||||
Consumer | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
OPERATING REVENUES | $ 5,704 | $ 6,062 | $ 6,194 | ||||||||
Expenses | 2,543 | 2,690 | 2,630 | ||||||||
OPERATING INCOME | $ 3,161 | $ 3,372 | $ 3,564 | ||||||||
Margin percentage (percent) | 55.00% | 56.00% | 58.00% |
Segment Information (Details 2)
Segment Information (Details 2) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2017USD ($)category | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Operating revenues by products and services | |||||||||||
Operating revenues | $ 5,323 | $ 4,034 | $ 4,090 | $ 4,209 | $ 4,289 | $ 4,382 | $ 4,398 | $ 4,401 | $ 17,656 | $ 17,470 | $ 17,900 |
Number of categories of products and services (categories) | category | 5 | ||||||||||
Surcharge amount on customers' bills | $ 601 | 572 | 544 | ||||||||
Regulatory | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | 732 | 704 | 729 | ||||||||
Total Non-Segment Revenues | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | 732 | 704 | 729 | ||||||||
Business | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | 11,220 | 10,704 | 10,977 | ||||||||
Business | IP & Data Services - Business | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | 3,595 | 2,851 | 2,704 | ||||||||
Business | Transport & Infrastructure - Business | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | 3,680 | 3,929 | 4,157 | ||||||||
Business | Voice & Collaboration | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | 3,294 | 3,284 | 3,429 | ||||||||
Business | IT & Managed Services | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | 651 | 640 | 687 | ||||||||
Consumer | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | 5,704 | 6,062 | 6,194 | ||||||||
Consumer | Voice & Collaboration | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | 2,385 | 2,659 | 2,897 | ||||||||
Consumer | IP & Data Services - Consumer | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | 448 | 506 | 468 | ||||||||
Consumer | Transport & Infrastructure - Consumer | |||||||||||
Operating revenues by products and services | |||||||||||
Operating revenues | $ 2,871 | $ 2,897 | $ 2,829 | ||||||||
Total operating revenues | Non-US | |||||||||||
Operating revenues by products and services | |||||||||||
Concentration risk (percent) | 2.00% | ||||||||||
Total assets | Non-US | |||||||||||
Operating revenues by products and services | |||||||||||
Concentration risk (percent) | 10.00% | ||||||||||
Total long-lived assets | Non-US | |||||||||||
Operating revenues by products and services | |||||||||||
Concentration risk (percent) | 10.00% |
Segment Information (Details 3)
Segment Information (Details 3) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||
Total segment income | $ 524 | $ 487 | $ 367 | $ 631 | $ 405 | $ 593 | $ 647 | $ 688 | $ 2,009 | $ 2,333 | $ 2,579 |
Depreciation and amortization | (3,936) | (3,916) | (4,189) | ||||||||
Non-segment expenses | (3,508) | (3,447) | (3,354) | ||||||||
Other expenses, net | (1,469) | (1,313) | (1,263) | ||||||||
INCOME BEFORE INCOME TAX EXPENSE | 540 | 1,020 | 1,316 | ||||||||
Income tax benefit (expense) | 849 | (394) | (438) | ||||||||
Net income | $ 1,117 | $ 92 | $ 17 | $ 163 | $ 42 | $ 152 | $ 196 | $ 236 | 1,389 | 626 | 878 |
Operating segments (segments) | |||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||
Total segment income | 7,534 | 7,685 | 8,146 | ||||||||
Unallocated amount to segment | |||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||
Other operating revenues | 732 | 704 | 729 | ||||||||
Depreciation and amortization | (3,936) | (3,916) | (4,189) | ||||||||
Non-segment expenses | (2,321) | (2,140) | (2,107) | ||||||||
Other expenses, net | (1,469) | (1,313) | (1,263) | ||||||||
INCOME BEFORE INCOME TAX EXPENSE | 540 | 1,020 | 1,316 | ||||||||
Income tax benefit (expense) | $ 849 | $ (394) | $ (438) |
Quarterly Financial Data (Una80
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 4 Months Ended | 12 Months Ended | 14 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | May 02, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | |
Operating revenues by products and services | |||||||||||||
Provisional tax benefit, amount | $ 1,100 | ||||||||||||
Statutory federal income tax rate (as a percent) | 35.00% | 35.00% | 35.00% | 35.00% | |||||||||
Federal income tax rate after enactment of Tax Reform (percentage) | 21.00% | ||||||||||||
Operating revenues | $ 5,323 | $ 4,034 | $ 4,090 | $ 4,209 | $ 4,289 | $ 4,382 | $ 4,398 | $ 4,401 | $ 17,656 | $ 17,470 | $ 17,900 | ||
OPERATING INCOME | 524 | 487 | 367 | 631 | 405 | 593 | 647 | 688 | 2,009 | 2,333 | 2,579 | ||
Net income | $ 1,117 | $ 92 | $ 17 | $ 163 | $ 42 | $ 152 | $ 196 | $ 236 | $ 1,389 | $ 626 | $ 878 | ||
Basic earnings per common share (in dollars per share) | $ 1.26 | $ 0.17 | $ 0.03 | $ 0.30 | $ 0.08 | $ 0.28 | $ 0.36 | $ 0.44 | $ 2.21 | $ 1.16 | $ 1.58 | ||
Diluted earnings per common share (in dollars per share) | $ 1.26 | $ 0.17 | $ 0.03 | $ 0.30 | $ 0.08 | $ 0.28 | $ 0.36 | $ 0.44 | $ 2.21 | $ 1.16 | $ 1.58 | ||
Severance expenses | $ 164 | ||||||||||||
Level 3 Communications, Inc. | |||||||||||||
Operating revenues by products and services | |||||||||||||
Total acquisition-related expenses | $ 206 | $ 37 | $ 18 | $ 10 | $ 52 | $ 271 | $ 52 | $ 323 | |||||
Colocation Business and Data Centers | |||||||||||||
Operating revenues by products and services | |||||||||||||
Depreciation and amortization | $ (50) | $ (67) | |||||||||||
Cyxtera Technologies | |||||||||||||
Operating revenues by products and services | |||||||||||||
Gain (Loss) on asset leaseback, failed-sale-leaseback transaction | (119) | (102) | |||||||||||
Depreciation expense on reclassified assets | $ 44 | 44 | |||||||||||
Operating revenues | 49 | ||||||||||||
Net income | $ (103) | ||||||||||||
Term Loan B | |||||||||||||
Operating revenues by products and services | |||||||||||||
Interest expense related to Term loan B | $ 20 | $ 44 |
Commitments and Contingencies81
Commitments and Contingencies (Details) | Oct. 14, 2011 | Feb. 28, 2017USD ($) | Dec. 31, 2017USD ($)lawsuit | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2007USD ($) | Sep. 30, 2017USD ($) |
Commitments and Contingencies | |||||||
Number of patents allegedly infringed, minimum | 1 | ||||||
Capital lease activity | |||||||
Assets acquired through capital leases | $ 35,000,000 | $ 45,000,000 | $ 17,000,000 | ||||
Depreciation expense | 50,000,000 | 70,000,000 | 96,000,000 | ||||
Cash payments towards capital leases | 48,000,000 | 58,000,000 | 89,000,000 | ||||
Assets included in property, plant and equipment | 342,000,000 | 705,000,000 | |||||
Accumulated depreciation | 153,000,000 | 351,000,000 | |||||
Future annual minimum payments under capital lease arrangements | |||||||
2,018 | 56,000,000 | ||||||
2,019 | 45,000,000 | ||||||
2,020 | 32,000,000 | ||||||
2,021 | 25,000,000 | ||||||
2,022 | 22,000,000 | ||||||
2023 and thereafter | 203,000,000 | ||||||
Total minimum payments | 383,000,000 | ||||||
Less: amount representing interest and executory costs | (117,000,000) | ||||||
Present value of minimum payments | 266,000,000 | ||||||
Less: current portion | (40,000,000) | ||||||
Long-term portion | 226,000,000 | ||||||
Operating Leases | |||||||
Rent expense | 550,000,000 | 482,000,000 | 467,000,000 | ||||
Sublease rental income | 13,000,000 | $ 12,000,000 | $ 12,000,000 | ||||
Future rental commitments | |||||||
2,018 | 666,000,000 | ||||||
2,019 | 533,000,000 | ||||||
2,020 | 467,000,000 | ||||||
2,021 | 367,000,000 | ||||||
2,022 | 326,000,000 | ||||||
2023 and thereafter | 2,116,000,000 | ||||||
Total future minimum payments | 4,475,000,000 | ||||||
Minimum sublease rentals due in the future under non-cancelable subleases | 92,000,000 | ||||||
Purchase obligations maturities | |||||||
Total purchase commitments | 953,000,000 | ||||||
2,017 | 343,000,000 | ||||||
2018 and 2019 | 265,000,000 | ||||||
2020 and 2021 | 103,000,000 | ||||||
2022 and thereafter | 242,000,000 | ||||||
Unfavorable regulatory action | |||||||
Commitments and Contingencies | |||||||
Reasonable expectation of loss, maximum per proceeding | $ 100,000 | ||||||
William Douglas Fulghum, et al. v. Embarq Corporation | |||||||
Commitments and Contingencies | |||||||
Effect of modifications made to Embarq's benefits program, greater than | $ 300,000,000 | ||||||
Abbott et al. v. Sprint Nextel et al. | |||||||
Commitments and Contingencies | |||||||
Number of plaintiffs have alleged breach of fiduciary duty (plaintiffs) | 1,500 | ||||||
CenturyLink, Inc. | Interexchange Carriers | |||||||
Commitments and Contingencies | |||||||
Loss contingency, pending claims, number | lawsuit | 100 | ||||||
Level 3 Parent, LLC | |||||||
Commitments and Contingencies | |||||||
Loss contingency, damages sought, value | $ 50,000,000 | ||||||
Level 3 Parent, LLC | Loss from catastrophes | |||||||
Commitments and Contingencies | |||||||
Reasonable expectation of loss, maximum per proceeding | $ 6,000,000 | ||||||
Judicial ruling | Missouri Municipalities | |||||||
Commitments and Contingencies | |||||||
Pending cases, final order | 1 | ||||||
Litigation settlement, amount awarded to other party | $ 4,000,000 | ||||||
Peruvian Tax Litigation | Pending litigation | Level 3 Parent, LLC | |||||||
Commitments and Contingencies | |||||||
Loss contingency, asserted claim | 15,000,000 | ||||||
Peruvian Tax Litigation, Before Interest | Pending litigation | Level 3 Parent, LLC | |||||||
Commitments and Contingencies | |||||||
Loss contingency, asserted claim | 26,000,000 | ||||||
Peruvian Tax Litigation, Income Taxwitholding 2001 and 2002 | Pending litigation | Level 3 Parent, LLC | |||||||
Commitments and Contingencies | |||||||
Loss contingency, asserted claim | 3,000,000 | ||||||
Peruvian Tax Litigation, Vat for 2001 and 2002 | Pending litigation | Level 3 Parent, LLC | |||||||
Commitments and Contingencies | |||||||
Loss contingency, asserted claim | 7,000,000 | ||||||
Peruvian Tax Litigation, Disallowance of VAT 2005 | Pending litigation | Level 3 Parent, LLC | |||||||
Commitments and Contingencies | |||||||
Loss contingency, asserted claim | 16,000,000 | ||||||
Employee Severance and Contractor Termination Disputes | Pending litigation | Level 3 Parent, LLC | |||||||
Commitments and Contingencies | |||||||
Loss contingency, asserted claim | 17,000,000 | ||||||
Maximum | Loss from catastrophes | |||||||
Commitments and Contingencies | |||||||
Reasonable expectation of loss, maximum per proceeding | 25,000,000 | ||||||
Maximum | Brazilian Tax Claims | Pending litigation | Level 3 Parent, LLC | |||||||
Commitments and Contingencies | |||||||
Loss contingency, range of possible loss, portion not accrued | $ 53,000,000 | ||||||
Minimum | Loss from catastrophes | |||||||
Commitments and Contingencies | |||||||
Reasonable expectation of loss, maximum per proceeding | $ 20,000,000 |
Other Financial Information (De
Other Financial Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Jan. 22, 2018 | |
Prepaid Expenses and Other Current Assets [Abstract] | |||
Prepaid expenses | $ 294 | $ 206 | |
Income tax receivable | 258 | 51 | |
Materials, supplies and inventory | 128 | 134 | |
Deferred activation and installation charges | 128 | 101 | |
Other | 133 | 55 | |
Total other current assets | 941 | 547 | |
Accounts Payable, Current [Abstract] | |||
Accounts payable | 1,555 | 1,179 | |
Other current liabilities: | |||
Accrued rent | 34 | 31 | |
Legal contingencies | 45 | 30 | |
Other | 265 | 152 | |
Total other current liabilities | 344 | 213 | |
Book overdraft balance | 36 | 56 | |
Capital expenditures included in accounts payable | $ 225 | $ 196 | |
Subsequent event | |||
Subsequent Event [Line Items] | |||
Assets Held-for-sale, Not Part of Disposal Group, Current | $ 68 |
Labor Union Contracts (Details)
Labor Union Contracts (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Workforce subject to collective bargaining arrangements expiring within one year | |
Labor Union Contracts | |
Number of unionized employees | 1,000 |
Workforce subject to collective bargaining agreements, expired in 2017 | |
Labor Union Contracts | |
Number of unionized employees | 1,000 |
Workforce subject to collective bargaining arrangements, effective June 18, 2017 | |
Labor Union Contracts | |
Number of unionized employees | 10,000 |
Total number of employees | Unionized employees concentration risk | |
Labor Union Contracts | |
Concentration risk (percent) | 28.00% |
Total number of employees | Unionized employees concentration risk | Workforce subject to collective bargaining arrangements, effective June 18, 2017 | |
Labor Union Contracts | |
Concentration risk (percent) | 71.00% |
Accumulated Other Comprehensi84
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Stockholders' Equity Attributable to Parent | $ 23,491 | $ 13,399 | $ 14,060 | |
Accumulated other comprehensive income (loss) by component | ||||
Other comprehensive income (loss) before reclassifications | (16) | (296) | ||
Amounts reclassified from accumulated other comprehensive income | 138 | 113 | ||
Net current-period other comprehensive income (loss) | 122 | (183) | 83 | |
Defined Benefit Plans | ||||
Accumulated other comprehensive income (loss) by component | ||||
Amounts reclassified from accumulated other comprehensive income | 138 | 113 | ||
Defined Benefit Plans | Pension plans | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Stockholders' Equity Attributable to Parent | (1,731) | (1,895) | (1,715) | |
Accumulated other comprehensive income (loss) by component | ||||
Other comprehensive income (loss) before reclassifications | 39 | (280) | ||
Amounts reclassified from accumulated other comprehensive income | 125 | 100 | ||
Net current-period other comprehensive income (loss) | 164 | (180) | ||
Defined Benefit Plans | Post-Retirement benefit plans | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Stockholders' Equity Attributable to Parent | (235) | (162) | (180) | |
Accumulated other comprehensive income (loss) by component | ||||
Other comprehensive income (loss) before reclassifications | (86) | 6 | ||
Amounts reclassified from accumulated other comprehensive income | 13 | 12 | ||
Net current-period other comprehensive income (loss) | (73) | 18 | ||
Foreign Currency Translation Adjustment and Other | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Stockholders' Equity Attributable to Parent | (29) | (60) | (39) | |
Accumulated other comprehensive income (loss) by component | ||||
Other comprehensive income (loss) before reclassifications | 31 | (22) | ||
Amounts reclassified from accumulated other comprehensive income | 0 | 1 | ||
Net current-period other comprehensive income (loss) | 31 | (21) | ||
AOCI Attributable to Parent | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Stockholders' Equity Attributable to Parent | (1,995) | (2,117) | (1,934) | $ (2,017) |
Accumulated other comprehensive income (loss) by component | ||||
Net current-period other comprehensive income (loss) | $ 122 | $ (183) | $ 83 |
Accumulated Other Comprehensi85
Accumulated Other Comprehensive Loss (Details 2) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Insignificant items | $ 12 | $ 5 | $ 49 |
Net of tax | 138 | 113 | |
Accumulated Defined Benefit Plans Adjustment, Net Gain (Loss) Attributable to Parent | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net actuarial loss and prior service cost | 205 | 175 | |
Accumulated Defined Benefit Plans Adjustment, Net Prior Service Attributable to Parent | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net actuarial loss and prior service cost | 12 | 12 | |
Accumulated Defined Benefit Plans Adjustment Attributable to Parent | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net actuarial loss and prior service cost | 217 | 187 | |
Income tax benefit | (79) | (75) | |
Insignificant items | 1 | ||
Net of tax | $ 138 | $ 113 |
Dividends (Details)
Dividends (Details) - USD ($) $ / shares in Units, $ in Millions | Feb. 21, 2018 | Nov. 14, 2017 | Aug. 22, 2017 | May 24, 2017 | Feb. 21, 2017 | Nov. 15, 2016 | Aug. 23, 2016 | May 18, 2016 | Feb. 23, 2016 |
Subsequent Event [Line Items] | |||||||||
Dividend per share (usd per share) | $ 0.540 | $ 0.540 | $ 0.540 | $ 0.540 | $ 0.540 | $ 0.540 | $ 0.540 | $ 0.540 | |
Total amount declared | $ 577 | $ 296 | $ 297 | $ 295 | $ 294 | $ 295 | $ 294 | $ 295 | |
Subsequent event | |||||||||
Subsequent Event [Line Items] | |||||||||
Dividend per share (usd per share) | $ 0.54 |