Consolidated Statements of Changes in Shareowners’ Investment

(dollars in millions, except per share amounts, and shares in thousands)

Years Ended December 31,

 

2007

   

2006

   

2005

 

 

Shares

 

Amount

 

Shares

 

Amount

 

Shares

 

Amount

 

 

Common Stock

Balance at beginning of year

2,967,652

 

$

297

 

2,774,865

 

$

277

 

2,774,865

 

$

277

 

Shares issued-MCI/Price acquisitions

(42

)

 

 

192,787

 

 

20

 

 

 

 

Balance at end of year

2,967,610

 

 

297

 

2,967,652

 

 

297

 

2,774,865

 

 

277

 

 

Contributed Capital

Balance at beginning of year

 

 

 

40,124

 

 

 

 

25,369

 

 

 

 

25,404

 

Shares issued-employee and shareowner plans

 

 

 

58

 

 

 

 

(1

)

 

 

 

(24

)

Shares issued-MCI/Price acquisitions

 

 

 

 

 

 

 

6,010

 

 

 

 

 

Domestic print and Internet yellow pages

directories business spin-off

 

 

 

 

 

 

 

8,695

 

 

 

 

 

Other

 

 

 

134

 

 

 

 

51

 

 

 

 

(11

)

Balance at end of year

 

 

 

40,316

 

 

 

 

40,124

 

 

 

 

25,369

 

 

Reinvested Earnings

Balance at beginning of year

 

 

 

17,324

 

 

 

 

15,905

 

 

 

 

12,984

 

Adoption of tax accounting standards (See Note 1)

 

 

 

(134

)

 

 

 

 

 

 

 

 

Adjusted balance at beginning of year

 

 

 

17,190

 

 

 

 

15,905

 

 

 

 

12,984

 

Net income

 

 

 

5,521

 

 

 

 

6,197

 

 

 

 

7,397

 

Dividends declared

($1.67, $1.62 and $1.62 per share)

 

 

 

(4,830

)

 

 

 

(4,781

)

 

 

 

(4,479

)

Other

 

 

 

3

 

 

 

 

3

 

 

 

 

3

 

Balance at end of year

 

 

 

17,884

 

 

 

 

17,324

 

 

 

 

15,905

 

 

Accumulated Other Comprehensive Loss

Balance at beginning of year

 

 

 

(7,530

)

 

 

 

(1,783

)

 

 

 

(1,053

)

Foreign currency translation adjustments

 

 

 

838

 

 

 

 

1,196

 

 

 

 

(755

)

Unrealized gains on net investment hedges

 

 

 

 

 

 

 

 

 

 

 

2

 

Unrealized gains (losses) on marketable securities

 

 

 

(4

)

 

 

 

54

 

 

 

 

(21

)

Unrealized gains on cash flow hedges

 

 

 

1

 

 

 

 

14

 

 

 

 

10

 

Defined benefit pension and postretirement plans

 

 

 

1,948

 

 

 

 

 

 

 

 

 

Minimum pension liability adjustment

 

 

 

 

 

 

 

526

 

 

 

 

51

 

Other

 

 

 

241

 

 

 

 

(128

)

 

 

 

(17

)

Other comprehensive income (loss)

 

 

 

3,024

 

 

 

 

1,662

 

 

 

 

(730

)

Adoption of pension and postretirement benefit

accounting standard (See Note 15)

 

 

 

 

 

 

 

(7,409

)

 

 

 

 

Balance at end of year

 

 

 

(4,506

)

 

 

 

(7,530

)

 

 

 

(1,783

)

 

Treasury Stock

Balance at beginning of year

(56,147

)

 

(1,871

)

(11,456

)

 

(353

)

(5,213

)

 

(142

)

Shares purchased

(68,063

)

 

(2,843

)

(50,066

)

 

(1,700

)

(7,859

)

 

(271

)

Shares distributed

Employee plans

33,411

 

 

1,224

 

5,355

 

 

181

 

1,594

 

 

59

 

Shareowner plans

13

 

 

1

 

20

 

 

1

 

22

 

 

1

 

Balance at end of year

(90,786

)

 

(3,489

)

(56,147

)

 

(1,871

)

(11,456

)

 

(353

)

 

Deferred Compensation–ESOPs and Other

Balance at beginning of year

 

 

 

191

 

 

 

 

265

 

 

 

 

90

 

Amortization

 

 

 

(112

)

 

 

 

(74

)

 

 

 

174

 

Other

 

 

 

 

 

 

 

 

 

 

 

1

 

Balance at end of year

 

 

 

79

 

 

 

 

191

 

 

 

 

265

 

Total Shareowners’ Investment

 

 

$

50,581

 

 

 

$

48,535

 

 

 

$

39,680

 

 

Comprehensive Income

Net income

 

 

$

5,521

 

 

 

$

6,197

 

 

 

$

7,397

 

Other comprehensive income (loss) per above

 

 

 

3,024

 

 

 

 

1,662

 

 

 

 

(730

)

Total Comprehensive Income

 

 

$

8,545

 

 

 

$

7,859

 

 

 

$

6,667

 

See Notes to Consolidated Financial Statements.