T » Topics » Cash Provided by or Used in Investing Activities

This excerpt taken from the T 10-Q filed Nov 2, 2006.

Cash Provided by or Used in Investing Activities

For the first nine months of 2006, cash used for investing activities consisted of:


$6,158 in construction and capital expenditures.


$624 of funding for Cingular’s capital and operating requirements in accordance with the terms of our agreement with Cingular and BellSouth. See our “Cingular” section below for details.


$62 related to an investment in 2Wire Inc., a privately held company that provides services related to Project Lightspeed.




SEPTEMBER 30, 2006


Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued

Dollars in millions except per share amounts



$50 related to the acquisition of Nistevo Corporation, which provides internet-based services related to services offered by our subsidiary Sterling.


During the first nine months of 2006, cash from dispositions of $72 related to the sale of securities and other assets.


To provide high-quality communications services to our customers, we must make significant investments in property, plant and equipment. The amount of capital investment is influenced by demand for services and products, continued growth and regulatory considerations. Our capital expenditures totaled $6,158 for the first nine months of 2006 and $3,743 for the first nine months of 2005. Capital expenditures in the wireline segment, which represented substantially all of our capital expenditures, increased 65.5% for the first nine months of 2006 compared to the first nine months of 2005. Our capital expenditures are primarily for our wireline subsidiaries’ networks (including ATTC), Project Lightspeed, merger-integration projects and support systems for our long-distance service.


Because of opportunities made available by the continued changing regulatory environment and our acquisition of ATTC, we expect that our capital expenditures in 2006, which include Project Lightspeed and exclude Cingular, will be at or slightly above the high end of our target range of $8,000 to $8,500. We expect to spend approximately $4,600 on our Project Lightspeed initiative for network related deployment costs and capital expenditures beginning in 2006 through 2008, as well as additional customer activation capital expenditures. We expect that the business opportunities made available, specifically in the data/broadband area, will allow us to expand our products and services (see
“U-verse Services (Project Lightspeed)” discussed in “Other Business Matters”).


We expect to fund 2006 capital expenditures for our wireline segment, which includes international operations, using cash from operations and incremental borrowings, depending on interest rate levels and overall market conditions. The other segment capital expenditures were less than 2.0% of total capital expenditures for the first nine months of 2006. Included in the other segment are equity investments, which should be self-funding as they are not direct AT&T operations, as well as corporate and Sterling operations, which we expect to fund using cash from operations. We expect to fund any directory segment capital expenditures using cash from operations. We discuss our Cingular segment below.


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