- The document discusses the company's 3Q06 results and actions to improve performance going forward. Key points include growing the wireless business through initiatives like expanding coverage, growing data usage, and pursuing MVNO partnerships. It also covers improving operating performance through initiatives to reduce costs and increase efficiency. Financial results for 3Q06 showed growth in wireless subscribers and data ARPU, but a decline in voice ARPU and adjusted OIBDA margins.

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28. quot;I - ;
-1
RECONCILIATIONS OF EARNINGS PER SHARE (Unaudited)
(millions, except per share data)
(c)
Pro Forma
As Reported
Quarter Ended Year-to-Date Quarter Ended Year-to-Date
September 30, September 30, September 30, September 30, September 30, September 30, September 30, September 30,
2006 2005 2006 2005 2006 2005 2006 2005
Income Available to Common Shareholders $ 247 $ 514 $ 1,034 $ 1,583 $ 247 $ 407 $ 1,034 $ 1,377
Preferred stock dividends paid - 2 2 5 - 2 2 5
Net Income (Loss) 247 516 1,036 1,588 247 409 1,036 1,382
Discontinued operations, net - (253) (334) (772) - (253) (334) (772)
Income from Continuing Operations 247 263 702 816 247 156 702 610
(a)
Special items (net of taxes)
Restructuring and asset impairments 31 24 77 43 31 24 77 43
Merger and integration expense 66 149 181 166 66 204 181 248
Hurricane charges (excluding asset impairments) - 49 - 49 - 49 - 49
Net gains on investment activities - (90) (40) (90) - (90) (40) (90)
(Gain) Loss on early retirement of debt (4) - (9) - (4) - (9) 22
Tax audit settlement (42) - (42) - (42) - (42) -
Motorola consent fee - - - - - 50 - 50
Adjusted Net Income* $ 298 $ 395 $ 869 $ 984 $ 298 $ 393 $ 869 $ 932
Amortization (net of taxes) 650 276 1,792 281 650 504 1,792 1,492
Adjusted Net Income before Amortization* $ 948 $ 671 $ 2,661 $ 1,265 $ 948 $ 897 $ 2,661 $ 2,424
Diluted Earnings Per Share $ 0.08 $ 0.23 $ 0.35 $ 0.91 $ 0.08 $ 0.14 $ 0.35 $ 0.47
Discontinued operations - (0.11) (0.11) (0.45) - (0.09) (0.11) (0.26)
Earnings Per Share from Continuing Operations 0.08 0.12 0.24 0.46 0.08 $ 0.05 0.24 $ 0.21
Special items 0.02 0.06 0.05 0.10 0.02 0.08 0.05 0.11
Adjusted Earnings Per Share* (b) $ 0.10 $ 0.18 $ 0.29 $ 0.56 $ 0.10 $ 0.13 $ 0.29 $ 0.32
(d)
Amortization (net of taxes) 0.22 0.12 0.60 0.16 0.22 0.17 0.60 0.50
Adjusted Earnings Per Share before Amortization* (b) $ 0.32 $ 0.30 $ 0.89 $ 0.72 $ 0.32 $ 0.30 $ 0.89 $ 0.82
(a)
See accompanying Notes to Financial Data for more information on special items.
(b)
Earnings per share data may not add due to rounding.
(c)
Pro forma consolidated information has been presented as if the Sprint Nextel merger occurred at the beginning of 2005. The 2006 periods reflect actual results.
(d)
Rounding difference is pushed to this line.
:

29. quot;I - ;
-1
(millions)
Long Corporate &
For the Quarter Ended September 30, 2006 Consolidated Wireless Distance Eliminations
Operating Income (Loss) $ 667 $ 702 $ 73 $ (108)
(a)
Special items
Severance, lease exit costs and asset impairments 50 41 9 -
Merger and integration expense 107 - - 107
Adjusted Operating Income* 824 743 82 (1)
Depreciation and amortization 2,540 2,416 124 -
Adjusted OIBDA* 3,364 3,159 206 (1)
Capital expenditures 1,843 1,473 255 115
Adjusted OIBDA* less Capex $ 1,521 $ 1,686 $ (49) $ (116)
Long Corporate &
For the Quarter Ended September 30, 2005 Consolidated Wireless Distance Eliminations
Operating Income (Loss) $ 488 $ 572 $ 124 $ (208)
Special items
Severance, lease exit costs and asset impairments 37 16 21 -
Merger and integration expense 234 - - 234
Hurricane charges 79 65 14 -
Adjusted Operating Income* 838 653 159 26
Depreciation and amortization 1,487 1,362 124 1
Adjusted OIBDA* 2,325 2,015 283 27
Capital expenditures 1,051 914 83 54
Adjusted OIBDA* less Capex $ 1,274 $ 1,101 $ 200 $ (27)
Pro forma Pro forma Long Corporate &
For the Quarter Ended September 30, 2005 Consolidated Wireless Distance Eliminations
Operating Income (Loss) $ 440 $ 608 $ 124 $ (292)
Special items
Severance, lease exit costs and asset impairments 37 16 21 -
Merger and integration expense 318 - - 318
Hurricane charges 79 65 14 -
Adjusted Operating Income* 874 689 159 26
Depreciation and amortization 2,079 1,954 124 1
Adjusted OIBDA* 2,953 2,643 283 27
Capital expenditures 1,406 1,262 83 61
Adjusted OIBDA* less Capex $ 1,547 $ 1,381 $ 200 $ (34)
(a)
See accompanying Notes to Financial Data for more information on special items.
=

30. quot;I - ;
-1
(millions)
Long Corporate &
For the Quarter Ended June 30, 2006 Consolidated Wireless Distance Eliminations
$ 712 $ 660 $ 155 $ (103)
Operating Income (Loss)
Special items
Severance, lease exit costs and asset impairments 40 33 7 -
Merger and integration expense 113 - - 113
865 693 162 10
Adjusted Operating Income*
Depreciation and amortization 2,354 2,242 113 (1)
3,219 2,935 275 9
Adjusted OIBDA*
Capital expenditures 1,359 1,064 200 95
$ 1,860 $ 1,871 $ 75 $ (86)
Adjusted OIBDA* less Capex
Long Corporate &
For the Quarter Ended March 31, 2006 Consolidated Wireless Distance Eliminations
$ 484 $ 436 $ 104 $ (56)
Operating Income (Loss)
Special items
Severance, lease exit costs and asset impairments 38 28 10 -
Merger and integration expense 76 - - 76
598 464 114 20
Adjusted Operating Income*
Depreciation and amortization 2,346 2,223 122 1
2,944 2,687 236 21
Adjusted OIBDA*
Capital expenditures 1,243 1,071 92 80
$ 1,701 $ 1,616 $ 144 $ (59)
Adjusted OIBDA* less Capex
(a)
See accompanying Notes to Financial Data for more information on special items.

31. quot;I - ;
-1
RECONCILIATIONS OF EARNINGS PER SHARE (Unaudited)
(millions, except per share data)
As Reported
Quarter Ended
June 30,
2006
$ 370
Income Available to Common Shareholders
Preferred stock dividends paid -
370
Net Income (Loss)
Discontinued operations, net (79)
291
Income from Continuing Operations
Special items (net of taxes) (a)
Severance, lease exit costs and asset impairments 23
Merger and integration expense 69
Net gains on investment activities (8)
(Gain) Loss on early retirement of debt (5)
$ 370
Adjusted Net Income*
Amortization (net of taxes) 577
$ 947
Adjusted Net Income before Amortization*
$ 0.12
Diluted Earnings Per Share
Discontinued operations (0.02)
0.10
Earnings Per Share from Continuing Operations
Special items 0.02
Adjusted Earnings Per Share* (b) $ 0.12
Amortization (net of taxes) 0.20
$ 0.32
Adjusted Earnings Per Share before Amortization*
>

32. quot;I - ;
-1
(millions)
Quarter Ended Year-to-date
September 30, June 30, September 30, September 30, September 30,
2006 2006 2005 2006 2005
Wireless Pro Forma
Adjusted OIBDA* $ 3,159 $ 2,935 $ 2,643 $ 8,781 $ 7,616
Service, wholesale, affiliate and other net
operating revenues 8,229 7,800 7,249 23,714 21,243
Adjusted OIBDA margin* 38.4% 37.6% 36.5% 37.0% 35.9%
Operating income $ 702 $ 660 $ 608 $ 1,798 $ 1,727
Operating income margin 8.5% 8.5% 8.4% 7.6% 8.1%
Long Distance
Adjusted OIBDA* $ 206 $ 275 $ 283 $ 717 $ 801
Total net operating revenues 1,626 1,641 1,735 4,936 5,172
Adjusted OIBDA margin* 12.7% 16.8% 16.3% 14.5% 15.5%
Operating income $ 73 $ 155 $ 124 $ 332 $ 395
Operating income margin 4.5% 9.4% 7.1% 6.7% 7.6%
Consolidated Pro Forma
Adjusted OIBDA* $ 3,364 $ 3,219 $ 2,953 $ 9,527 $ 8,493
Service, wholesale, affiliate and other net
operating revenues 9,653 9,290 8,881 28,187 26,132
Adjusted OIBDA margin* 34.8% 34.7% 33.3% 33.8% 32.5%
Operating income $ 667 $ 712 $ 440 $ 1,863 $ 1,807
Operating income margin 6.9% 7.7% 5.0% 6.6% 6.9%

33. quot;I - ;
-1
(millions)
Quarter Ended Year-to-Date
September 30, September 30, September 30, September 30,
2006 2005 2006 2005
$ 3,364 $ 2,325 $ 9,527 $ 5,268
Adjusted OIBDA*
Adjust for special items (157) (350) (424) (408)
Proceeds from communications towers lease transactions - - - 1,195
Other operating activities, net (a) (303) (711) (1,511) (839)
Capital expenditures (1,885) (1,051) (4,798) (2,365)
Dividends paid (74) (74) (224) (447)
Proceeds from sales of assets 54 378 211 589
Other investing activities, net (230) 284 (443) 831
Free Cash Flow* 769 801 2,338 3,824
Decrease in debt, net (1,783) (9) (5,746) (1,024)
Retirement of redeemable preferred shares - - (247) -
Purchase of treasury shares (1,523) - (1,523) -
Cash transferred to Embarq, net of cash received and
- - 6,268 -
proceeds from the sale of Embarq notes
Discontinued operations activity, net (b) - 68 367 83
Cash acquired in Nextel merger, net of cash paid - 1,183 - 1,183
(867) (949) (10,483) (949)
Purchase of PCS Affiliates, Nextel Partners and Velocita, net of cash acquired
Change in restricted cash 1,124 - 93 -
Distributions from unconsolidated investees, net - 181 - 181
Investments in debt securities, net 91 134 1,128 49
Proceeds from common shares issued 46 187 372 293
Other financing activities, net 12 7 12 12
Change in cash and cash equivalents - GAAP $ (2,131) $ 1,603 $ (7,421) $ 3,652
September 30,
2006
Total Debt $ 21,961
Less: Cash on hand (1,482)
Less: Current marketable securities (626)
$ 19,853
Net Debt*
(a)
Other operating activities, net includes the change in working capital, change in deferred income taxes, miscellaneous operating activities and
non-operating items in net income (loss).
(b)
Discontinued operations activity, net includes $6.6 billion from the issuance of long-term debt.

34. quot;I - ;
-1
As of
September 30, 2006
Total Debt $ 21,961
Less: Cash on Hand (1,482)
Less: Current Marketable Securities (626)
Net Debt * $ 19,853
Pro Forma Net Debt $ 19,853
Adjusted OIBDA for the three months ended, September 30, 2006 $ 3,364
*4
Annualizd Adjusted OIBDA * $ 13,456
Pro Forma Net Debt/Annualized Adjusted OIBDA * 1.5
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