Consolidated Statements of Changes in Shareowners’ Investment

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

Years Ended December 31,

 

2008

 

 

2007

 

 

2006

 

 

Shares

 

Amount

 

Shares

 

Amount

 

Shares

 

Amount

 

Common Stock

Balance at beginning of year

2,967,610

 

$

297

 

2,967,652

 

$

297

 

2,774,865

 

$

277

 

Shares issued–MCI/Price acquisitions

 

 

 

(42

)

 

 

192,787

 

 

20

 

Balance at end of year

2,967,610

 

 

297

 

2,967,610

 

 

297

 

2,967,652

 

 

297

 

 

Contributed Capital

Balance at beginning of year

 

 

 

40,316

 

 

 

 

40,124

 

 

 

 

25,369

 

Shares issued-employee and

shareowner plans

 

 

 

 

 

 

 

58

 

 

 

 

(1

)

Shares issued-MCI/Price acquisitions

 

 

 

 

 

 

 

 

 

 

 

6,010

 

Domestic print and Internet yellow

pages directories business spin-off

 

 

 

 

 

 

 

 

 

 

 

8,695

 

Other

 

 

 

(25

)

 

 

 

134

 

 

 

 

51

 

Balance at end of year

 

 

 

40,291

 

 

 

 

40,316

 

 

 

 

40,124

 

 

Reinvested Earnings

Balance at beginning of year

 

 

 

17,884

 

 

 

 

17,324

 

 

 

 

15,905

 

Adoption of tax accounting standards

(See Note 1)

 

 

 

 

 

 

 

(134

)

 

 

 

 

Adjusted balance at beginning of year

 

 

 

17,884

 

 

 

 

17,190

 

 

 

 

15,905

 

Net income

 

 

 

6,428

 

 

 

 

5,521

 

 

 

 

6,197

 

Dividends declared

($1.78, $1.67 and $1.62 per share)

 

 

 

(5,062

)

 

 

 

(4,830

)

 

 

 

(4,781

)

Other

 

 

 

 

 

 

 

3

 

 

 

 

3

 

Balance at end of year

 

 

 

19,250

 

 

 

 

17,884

 

 

 

 

17,324

 

 

Accumulated Other

Comprehensive Loss

Balance at beginning of year

 

 

 

(4,506

)

 

 

 

(7,530

)

 

 

 

(1,783

)

Spin-off of local exchange businesses

in Maine, New Hampshire and

Vermont (see Note 3)

 

 

 

44

 

 

 

 

 

 

 

 

 

Adjusted balance at beginning of year

 

 

 

(4,462

)

 

 

 

(7,530

)

 

 

 

(1,783

)

Foreign currency translation adjustments

 

 

 

(231

)

 

 

 

838

 

 

 

 

1,196

 

Unrealized gains (losses)

on marketable securities

 

 

 

(97

)

 

 

 

(4

)

 

 

 

54

 

Unrealized gains (losses)

on cash flow hedges

 

 

 

(40

)

 

 

 

1

 

 

 

 

14

 

Defined benefit pension and

postretirement plans

 

 

 

(8,542

)

 

 

 

1,948

 

 

 

 

 

Minimum pension liability adjustment

 

 

 

 

 

 

 

 

 

 

 

526

 

Other

 

 

 

 

 

 

 

241

 

 

 

 

(128

)

Other comprehensive income (loss)

 

 

 

(8,910

)

 

 

 

3,024

 

 

 

 

1,662

 

Adoption of pension and postretirement

benefit accounting standard (See Note 1)

 

 

 

 

 

 

 

 

 

 

 

(7,409

)

Balance at end of year

 

 

 

(13,372

)

 

 

 

(4,506

)

 

 

 

(7,530

)

 

Treasury Stock

Balance at beginning of year

(90,786

)

 

(3,489

)

(56,147

)

 

(1,871

)

(11,456

)

 

(353

)

Shares purchased

(36,779

)

 

(1,368

)

(68,063

)

 

(2,843

)

(50,066

)

 

(1,700

)

Shares distributed

Employee plans

468

 

 

18

 

33,411

 

 

1,224

 

5,355

 

 

181

 

Shareowner plans

7

 

 

 

13

 

 

1

 

20

 

 

1

 

Balance at end of year

(127,090

)

 

(4,839

)

(90,786

)

 

(3,489

)

(56,147

)

 

(1,871

)

 

Deferred Compensation–

ESOPs and Other

Balance at beginning of year

 

 

 

79

 

 

 

 

191

 

 

 

 

265

 

Amortization

 

 

 

 

 

 

 

(112

)

 

 

 

(74

)

Other

 

 

 

 

 

 

 

 

 

 

 

 

Balance at end of year

 

 

 

79

 

 

 

 

79

 

 

 

 

191

 

Total Shareowners’ Investment

 

 

$

41,706

 

 

 

$

50,581

 

 

 

$

48,535

 

 

Comprehensive Income

Net income

 

 

$

6,428

 

 

 

$

5,521

 

 

 

$

6,197

 

Other comprehensive income (loss)

per above

 

 

 

(8,910

)

 

 

 

3,024

 

 

 

 

1,662

 

Total Comprehensive Income (Loss)

 

 

$

(2,482

)

 

 

$

8,545

 

 

 

$

7,859

 

See Notes to Consolidated Financial Statements.