Planned Divestiture of the Lumen Mass Markets Fiber-to-the-Home Business |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Planned Divestiture of the Lumen Mass Markets Fiber-to-the-Home Business | Note 2—Planned Divestiture of the Lumen Mass Markets Fiber-to-the-Home Business On May 21, 2025, we entered into a definitive agreement to sell to AT&T the Lumen Mass Markets fiber-to-the-home business, operated by us and certain of our affiliates in 11 states for a pre-tax total of $5.75 billion in cash, subject to working capital and various other purchase price adjustments. The portion of this amount attributable to us cannot currently be calculated, and will be dependent upon several variables. The actual amount of our net after-tax proceeds from this divestiture could vary substantially from the amounts we currently estimate, including if we experience delays in completing the transaction or if there are changes in other assumptions that impact our estimates. We do not believe this divestiture transaction represents a strategic shift for us and therefore, does not meet the criteria to be classified as a discontinued operation. As a result, we will continue to report our operating results for the Mass Markets fiber-to-the-home business (the "disposal group") in our consolidated operating results until the transaction is closed. We anticipate closing this divestiture in the first half of 2026, upon receipt of all requisite regulatory approvals, as well as the satisfaction of other customary conditions. As of June 30, 2025 in the accompanying consolidated balance sheet, the assets and liabilities of the disposal group are classified as held for sale and measured at the lower of (i) the carrying value when we classified the disposal group as held for sale or (ii) the fair value of the disposal group, less costs to sell. Effective with the designation of the disposal group as held for sale on May 21, 2025, we suspended recording depreciation of property, plant and equipment while these assets are classified as held for sale. We estimate that we would have recorded an additional $15 million of depreciation for the three and six months ended June 30, 2025, respectively, if the disposal group did not meet the held for sale criteria. Under the terms of the purchase agreement, Lumen agreed to grant the purchaser an indefeasible right to use (“IRU”) certain Lumen retained fiber assets following the close of the transaction in order to service the transferred customer contracts. The value of these retained Lumen assets subject to the IRU is excluded from assets held for sale in the table below. The principal components of the held for sale assets and liabilities of the disposal group as of June 30, 2025 are as follows:
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