LEVEL 3 PARENT, LLC, 10-Q filed on 5/5/2022
Quarterly Report
v3.22.1
Cover Page
 3 Months Ended
Mar. 31, 2022
shares
Cover [Abstract]  
Document Type 10-Q
Document Quarterly Report true
Document Period End Date Mar. 31, 2022
Document Transition Report false
Entity File Number 001-35134
Entity Registrant Name LEVEL 3 PARENT, LLC
Entity Incorporation, State or Country Code DE
Entity Tax Identification Number 47-0210602
Entity Address, Address Line One 1025 Eldorado Blvd.,
Entity Address, City or Town Broomfield,
Entity Address, State or Province CO
Entity Address, Postal Zip Code 80021-8869
City Area Code 720
Local Phone Number 888-1000
Entity Current Reporting Status Yes
Entity Interactive Data Current Yes
Entity Filer Category Non-accelerated Filer
Entity Small Business false
Entity Emerging Growth Company false
Entity Shell Company false
Entity Common Stock, Shares Outstanding 0
Entity Central Index Key 0000794323
Amendment Flag false
Current Fiscal Year End Date --12-31
Document Fiscal Year Focus 2022
Document Fiscal Period Focus Q1
v3.22.1
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
OPERATING REVENUE    
Operating revenues $ 1,946 $ 1,989
OPERATING EXPENSES    
Cost of services and products (exclusive of depreciation and amortization) 851 878
Selling, general and administrative 314 294
Operating expenses - affiliates 146 107
Depreciation and amortization 396 437
Total operating expenses 1,707 1,716
OPERATING INCOME 239 273
OTHER (EXPENSE) INCOME    
Interest income - affiliate 16 18
Interest expense (90) (93)
Other (expense) income, net (7) 4
Total other expense, net (81) (71)
INCOME BEFORE INCOME TAXES 158 202
Income tax expense 44 51
NET INCOME 114 151
Non-Affiliate Revenue    
OPERATING REVENUE    
Operating revenues 1,890 1,934
Affiliate Services    
OPERATING REVENUE    
Operating revenues $ 56 $ 55
v3.22.1
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
Statement of Comprehensive Income [Abstract]    
NET INCOME $ 114 $ 151
OTHER COMPREHENSIVE INCOME (LOSS)    
Foreign currency translation adjustments, net of $10 and $7 tax 69 (88)
Other comprehensive income (loss), net of tax 69 (88)
COMPREHENSIVE INCOME $ 183 $ 63
v3.22.1
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (Parenthetical) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
Statement of Comprehensive Income [Abstract]    
Foreign currency translation adjustments, tax effect $ 10 $ 7
v3.22.1
CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($)
$ in Millions
Mar. 31, 2022
Dec. 31, 2021
CURRENT ASSETS    
Cash and cash equivalents $ 155 $ 146
Accounts receivable, less allowance of $36 and $39 551 642
Intercompany advances 8 0
Note receivable - affiliate 1,468 1,468
Assets held for sale 2,892 2,708
Other 276 239
Total current assets 5,350 5,203
Property, plant and equipment, net of accumulated depreciation of $3,388 and $3,202 9,022 9,042
GOODWILL AND OTHER ASSETS    
Goodwill 6,655 6,666
Other intangible assets, net 5,548 5,725
Other, net 1,526 1,459
Total goodwill and other assets 13,729 13,850
TOTAL ASSETS 28,101 28,095
CURRENT LIABILITIES    
Current maturities of long-term debt 29 26
Accounts payable 399 381
Accounts payable - affiliates 0 18
Accrued expenses and other liabilities    
Salaries and benefits 112 176
Income and other taxes 78 83
Current operating lease liabilities 313 299
Other 121 150
Liabilities held for sale 464 435
Current portion of deferred revenue 309 291
Total current liabilities 1,825 1,859
LONG-TERM DEBT 10,390 10,396
DEFERRED REVENUE AND OTHER LIABILITIES    
Deferred revenue 1,415 1,404
Operating lease liabilities 1,009 953
Other 480 474
Total deferred revenue and other liabilities 2,904 2,831
COMMITMENTS AND CONTINGENCIES (Note 8)
MEMBER'S EQUITY    
Member's equity 13,264 13,360
Accumulated other comprehensive loss (282) (351)
Total member's equity 12,982 13,009
TOTAL LIABILITIES AND MEMBER'S EQUITY $ 28,101 $ 28,095
v3.22.1
CONSOLIDATED BALANCE SHEETS (UNAUDITED) - (Parenthetical) - USD ($)
$ in Millions
Mar. 31, 2022
Dec. 31, 2021
Statement of Financial Position [Abstract]    
Allowance for doubtful accounts $ 36 $ 39
Accumulated depreciation $ 3,388 $ 3,202
v3.22.1
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
OPERATING ACTIVITIES    
Net income $ 114 $ 151
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization 396 437
Deferred income taxes 29 42
Changes in current assets and liabilities:    
Accounts receivable 84 1
Accounts payable (28) (1)
Other assets and liabilities, net (121) (159)
Other assets and liabilities, affiliate (14) (161)
Changes in other noncurrent assets and liabilities, net 40 37
Other, net 41 (19)
Net cash provided by operating activities 541 328
INVESTING ACTIVITIES    
Capital expenditures (264) (297)
Proceeds from sale of property, plant and equipment and other assets 1 25
Net cash used in investing activities (263) (272)
FINANCING ACTIVITIES    
Net proceeds from issuance of long-term debt 0 891
Distributions (210) 0
Payments of long-term debt (40) (904)
Other 0 (2)
Net cash used in financing activities (250) (15)
Net increase in cash, cash equivalents and restricted cash 28 41
Cash, cash equivalents and restricted cash at beginning of period 191 205
Cash, cash equivalents and restricted cash at end of period 219 246
Supplemental cash flow information:    
Income taxes paid, net (9) (7)
Interest paid (net of capitalized interest of $4 and $4) (113) (126)
Cash, cash equivalents and restricted cash:    
Cash and cash equivalents 155 234
Cash and cash equivalents included in assets held for sale 58 0
Restricted cash included in Other current assets 2 2
Restricted cash included in Other, net noncurrent assets 4 10
Total $ 219 $ 246
v3.22.1
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Parenthetical) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
Statement of Cash Flows [Abstract]    
Capitalized interest $ 4 $ 4
v3.22.1
CONSOLIDATED STATEMENTS OF MEMBER'S EQUITY (UNAUDITED) - USD ($)
$ in Millions
Total
MEMBER'S EQUITY
ACCUMULATED OTHER COMPREHENSIVE LOSS
Balance at beginning of period at Dec. 31, 2020   $ 13,139 $ (234)
MEMBER'S EQUITY      
Net income $ 151 151  
Distributions   0  
Other   0  
Other comprehensive income (loss) (88)   (88)
Balance at end of period at Mar. 31, 2021 12,968 13,290 (322)
Balance at beginning of period at Dec. 31, 2021 13,009 13,360 (351)
MEMBER'S EQUITY      
Net income 114 114  
Distributions   (210)  
Other   0  
Other comprehensive income (loss) 69   69
Balance at end of period at Mar. 31, 2022 $ 12,982 $ 13,264 $ (282)
v3.22.1
Background
 3 Months Ended
Mar. 31, 2022
Accounting Policies [Abstract]  
Background Background
General

We are an international facilities-based technology communications provider (that is, a provider that owns or leases a substantial portion of the property, plant and equipment necessary to provide our services) of a broad range of integrated communications services. We created our communications network by constructing our own assets and through a combination of purchasing other companies and purchasing or leasing facilities from others. We designed our network to provide communications services that employ and take advantage of rapidly improving underlying optical, Internet Protocol, computing and storage technologies.

Basis of Presentation

Our consolidated balance sheet as of December 31, 2021, which was derived from our audited consolidated financial statements, and our unaudited interim consolidated financial statements provided herein have been prepared in accordance with the instructions for Form 10-Q. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been condensed or omitted pursuant to rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). However, in our opinion, the disclosures made therein are adequate to make the information presented not misleading. We believe these consolidated financial statements include all normal recurring adjustments necessary to fairly present the results for the interim periods. The consolidated results of operations and cash flows for the first three months of the year are not necessarily indicative of the consolidated results of operations and cash flows that might be expected for the entire year. These consolidated financial statements and the accompanying notes should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2021.

The accompanying consolidated financial statements include our accounts and the accounts of our subsidiaries in which we have a controlling interest. Intercompany amounts and transactions with our consolidated subsidiaries have been eliminated. Transactions with our non-consolidated affiliates (Lumen Technologies and its other subsidiaries, referred to herein as affiliates) have not been eliminated.

Operating lease assets are included in other, net under goodwill and other assets on our consolidated balance sheets. Other, net included affiliate operating lease assets of $346 million and $294 million as of March 31, 2022 and December 31, 2021, respectively. Additionally, current operating lease liabilities included the current portion of affiliate operating lease liabilities of $94 million and $82 million as of March 31, 2022 and December 31, 2021, respectively, and operating lease liabilities included the noncurrent portion of affiliate operating lease liabilities of $263 million and $224 million as of March 31, 2022 and December 31, 2021, respectively.

Segments

Our operations are integrated into and reported as part of Lumen Technologies. Lumen's chief operating decision maker ("CODM") is our CODM, but reviews our financial information on an aggregate basis only in connection with our quarterly and annual reports that we file with the SEC. Consequently, we do not provide our discrete financial information to the CODM on a regular basis. As such, we have one reportable segment.
Summary of Significant Accounting Policies

Refer to the significant accounting policies described in Note 1 — Background and Summary of Significant Accounting Policies to the consolidated financial statements and accompanying notes in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2021.

Recently Adopted Accounting Pronouncements

Government Assistance

On January 1, 2022, we adopted Accounting Standards Update ("ASU") 2021-10, "Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance” (“ASU 2020-10”). This ASU increases transparency in financial reporting by requiring business entities to disclose information about certain types of government assistance they receive. The ASU only impacts annual financial statement note disclosures. Therefore, the adoption of ASU 2021-10 did not have a material impact to our consolidated financial statements.

Leases

On January 1, 2022, we adopted ASU 2021-05, “Leases (Topic 842): Lessors—Certain Leases with Variable Lease Payments” (“ASU 2021-05”). This ASU (i) amends the lease classification requirements for lessors to align them with practice under ASC Topic 840, (ii) provides criteria for lessors to classify and account for a lease with variable lease payments that do not depend on a reference index or a rate as an operating lease; and (iii) when a lease is classified as operating, the lessor does not recognize a net investment in the lease, does not derecognize the underlying asset, and, therefore, does not recognize a selling profit or loss. The adoption of ASU 2021-05 did not have a material impact to our consolidated financial statements.

Debt

On January 1, 2021, we adopted ASU 2020-09, “Debt (Topic 470) Amendments to SEC Paragraphs Pursuant to SEC Release No. 33-10762” (“ASU 2020-09”). This ASU amends and supersedes various SEC guidance to reflect SEC Release No. 33-10762, which includes amendments to the financial disclosure requirements applicable to registered debt offerings that include credit enhancements, such as subsidiary guarantees. The adoption of ASU 2020-09 did not have a material impact to our consolidated financial statements.

Investments

On January 1, 2021, we adopted ASU 2020-01, “Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)” (ASU 2020-01”). This ASU, among other things, clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investments - Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. As of March 31, 2022, we determined there was no application or discontinuation of the equity method during the reporting periods covered by this report. The adoption of ASU 2020-01 did not have a material impact to our consolidated financial statements.

Income Taxes

On January 1, 2021, we adopted ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”).This ASU removes certain exceptions for investments, intra-period allocations and interim calculations, and adds guidance to reduce complexity in accounting for income taxes. The adoption of ASU 2019-12 did not have a material impact to our consolidated financial statements.

Recently Issued Accounting Pronouncements

In March 2022, the Financial Accounting Standards Board ("FASB") issued ASU 2022-02, “Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings (“TDR”) and Vintage Disclosures” (“ASU 2022-02”). These amendments eliminate the TDR recognition and measurement guidance and enhance existing disclosure requirements and introduce new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. ASU 2020-02 will become effective for us in the first quarter of fiscal 2023 and early adoption is permitted. As of March 31, 2022, we do not expect ASU 2022-02 to have an impact to our consolidated financial statements.
In March 2022, the FASB issued ASU 2022-01, “Derivatives and Hedging (Topic 815): Fair Value Hedging-Portfolio Layer Method” (ASU 2022-01). The ASU expands the current single-layer method to allow multiple hedged layers of a single closed portfolio under the method. ASU 2020-01 will become effective for us in the first quarter of fiscal 2023 and early adoption is permitted. As of March 31, 2022, we do not expect ASU 2022-01 to have an impact to our consolidated financial statements.

In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers” (“ASU 2021-08”), which requires entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. ASU 2021-08 will become effective for us in the first quarter of fiscal 2023 and early adoption is permitted. As of March 31, 2022, we do not expect ASU 2021-08 to have an impact to our consolidated financial statements.

In January 2021, the FASB issued ASU 2021-01, "Reference Rate Reform (Topic 848): Scope" ("ASU 2021-01"), which clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. ASU 2021-01 also amends the expedients and exceptions in Topic 848 to capture the incremental consequences of the scope clarification and to tailor the existing guidance to derivative instruments affected by the discounting transition. These amendments may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. ASU 2021-01 provides option guidance for a limited time to ease the potential burden in accounting for reference rate reform. Based on our review of our key material contracts through March 31, 2022, we do not expect ASU 2021-01 to have a material impact to our consolidated financial statements.
v3.22.1
Planned Divestiture of Latin American Business
 3 Months Ended
Mar. 31, 2022
Discontinued Operations and Disposal Groups [Abstract]  
Planned Divestiture of Latin American Business Planned Divestiture of the Latin American Business
On July 25, 2021, affiliates of Level 3 Parent, LLC executed a definitive agreement to divest our Latin American business to an affiliate of a fund advised by Stonepeak Partners LP in exchange for $2.7 billion cash, subject to certain working capital and other purchase price adjustments and related transaction expenses (estimated to be approximately $50 million). We anticipate closing the transaction during the second half of 2022, upon receipt of all requisite regulatory approvals in the U.S. and certain countries where the Latin American business operates, as well as the satisfaction of other customary conditions.

The actual amount of our net after-tax proceeds from this divestiture could vary substantially from the amounts we currently estimate, particularly if we experience delays in completing the transaction or if any of our other assumptions prove to be incorrect.

We do not believe this divestiture transaction represents a strategic shift for Level 3. Therefore, the Latin American business 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 Latin American business in our consolidated operating results until the transaction is closed. The pre-tax net income of the Latin American business is estimated to be as follows in the table below:

Three Months Ended March 31,
20222021
(Dollars in millions)
Pre-tax net income $83 28 

As of March 31, 2022 in the accompanying consolidated balance sheets, the assets and liabilities of our Latin American business (the "disposal group") are classified as held for sale and are measured at the lower of (i) the carrying value of the disposal group and (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 July 25, 2021, we suspended recording depreciation of property, plant and equipment and amortization of finite-lived intangible assets and right-of-use assets while these assets are classified as held for sale. We estimate that we would have recorded an additional $49 million of depreciation, intangible amortization, and amortization of right-of use assets for the three months ended March 31, 2022 if the Latin American business did not meet the held for sale criteria.
As a result of our evaluation of the recoverability of the carrying value of the assets and liabilities held for sale relative to the agreed upon sales price, adjusted for costs to sell, we did not record any estimated loss on disposal for the three months ended March 31, 2022. The recoverability of the disposal group will be evaluated each reporting period until the closing of the transaction.

The principal components of the held for sale assets and liabilities are as follows:

March 31, 2022December 31, 2021
(Dollars in millions)
Assets held for sale
Cash and cash equivalents$58 39 
Accounts receivable, less allowance of $3 and $3
93 83 
Other current assets83 81 
Property, plant and equipment, net accumulated depreciation of $456 and $434
1,704 1,591 
Goodwill (1)
733 713 
Customer relationships and other intangibles, net138 126 
Other non-current assets83 75 
Total assets held for sale$2,892 2,708 
Liabilities held for sale
Accounts payable$90 101 
Salaries and benefits25 23 
Income and other taxes34 27 
Current portion of deferred revenue26 26 
Other current liabilities7 7 
Deferred income taxes, net148 129 
Other non-current liabilities134 122 
Total liabilities held for sale$464 435 
______________________________________________________________________
(1)    The assignment of goodwill was based on the relative fair value of the disposal group and the portion of the remaining reporting unit.
v3.22.1
Goodwill, Customer Relationships and Other Intangible Assets
 3 Months Ended
Mar. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill, Customer Relationships and Other Intangible Assets Goodwill, Customer Relationships and Other Intangible Assets
Goodwill, customer relationships and other intangible assets consisted of the following:
March 31, 2022December 31, 2021
(Dollars in millions)
Goodwill$6,655 6,666 
Customer relationships, less accumulated amortization of $2,949 and $2,779
$5,147 5,325 
Capitalized software, less accumulated amortization of $356 and $349
386 378 
Trade names, less accumulated amortization of $115 and $109
15 22 
Total other intangible assets, net$5,548 5,725 

Our goodwill was derived from Lumen's acquisition of us where the purchase price exceeded the fair value of the net assets acquired.
We assess our goodwill for impairment annually, or under certain circumstances, more frequently, such as when events or changes in circumstances indicate there may be impairment. We are required to write down the value of goodwill only when our assessment determines the carrying value of equity of our reporting unit exceeds its fair value. Our annual impairment assessment date for goodwill is October 31, at which date we assess goodwill at our reporting unit. In reviewing the criteria for reporting units, we have determined that we are one reporting unit.

The following table shows the rollforward of goodwill from December 31, 2021 through March 31, 2022:
(Dollars in millions)
As of December 31, 2021 (1)
$6,666 
Effect of foreign currency exchange rate changes(11)
As of March 31, 2022 (1)
$6,655 
_______________________________________________________________________________
(1)Goodwill at March 31, 2022 and December 31, 2021 is net of accumulated impairment loss of $3.6 billion.

Total amortization expense for finite-lived intangible assets for the three months ended March 31, 2022 and 2021 totaled $192 million and $211 million, respectively. As of March 31, 2022, the gross carrying amount of goodwill, customer relationships, capitalized software, indefinite-life and other intangible assets was $15.6 billion.

We estimate that total amortization expense for intangible assets for the years ending December 31, 2022 through 2026 will be as provided in the table below. As a result of reclassifying our Latin American business as being held for sale on our March 31, 2022 consolidated balance sheet, the amounts presented below do not include the future amortization of the intangible assets for the business to be divested. See Note 2—Planned Divestiture of the Latin American Business for more information.
(Dollars in millions)
2022 (remaining nine months)$550 
2023713 
2024709 
2025684 
2026641 
v3.22.1
Revenue Recognition
 3 Months Ended
Mar. 31, 2022
Revenue from Contract with Customer [Abstract]  
Revenue Recognition Revenue Recognition
We categorize our products and services and related revenue among the following categories:
•Compute and Application Services, which include our Edge Cloud services, IT solutions, Unified Communications and Collaboration ("UC&C"), data center, content delivery network ("CDN") and Managed Security services;
•IP and Data Services, which include Ethernet, IP, and VPN data networks, including software-defined wide area networks ("SD WAN") based services, Dynamic Connections and Hyper WAN;
•Fiber Infrastructure Services, which include dark fiber, optical services and equipment;
•Voice and Other, which include Time Division Multiplexing ("TDM") voice, private line and other legacy services; and
•Affiliate Services, which include communications services provided to our affiliates that we also provide to our external customers.
Disaggregated Revenue by Service Offering

The following table provides disaggregation of revenue from contracts with customers based on service offering for the three months ended March 31, 2022 and 2021. It also shows the amount of revenue that is not subject to ASC 606, but is instead governed by other accounting standards:
Three Months Ended March 31, 2022Three Months Ended March 31, 2021
Total Revenue
Adjustments for Non-ASC 606 Revenue(1)
Total Revenue from Contracts with CustomersTotal Revenue
Adjustments for Non-ASC 606 Revenue(1)
Total Revenue from Contracts with Customers
(Dollars in millions)
Compute and Application Services$277 (128)149 280 (127)153 
IP and Data Services886 — 886 881 — 881 
Fiber Infrastructure Services391 (54)337 397 (53)344 
Voice and Other336 (4)332 376 (2)374 
Affiliate Services56 (56)— 55 (55)— 
Total revenue$1,946 (242)1,704 1,989 (237)1,752 
_____________________________________________________________________
(1) Includes lease revenue which is not within the scope of ASC 606.

Operating Lease Income

We lease various dark fiber, office facilities, colocation facilities, switching facilities, other network sites and service equipment to third parties under operating leases. Lease and sublease revenue are included in operating revenue in our consolidated statements of operations.

For the three months ended March 31, 2022 and 2021, our gross rental income was $203 million and $197 million, which represents approximately 10% of our operating revenue for both periods.

Customer Receivables and Contract Balances

The following table provides balances of customer receivables, contract assets and contract liabilities, net of amounts reclassified as held for sale as of March 31, 2022 and December 31, 2021:
March 31, 2022December 31, 2021
(Dollars in millions)
Customer receivables (1)
$548 640 
Contract assets (2)
34 35 
Contract liabilities (3)
236 247 
_____________________________________________________________________
(1)Reflects gross customer receivables of $584 million and $679 million, net of allowance for credit losses of $36 million and $39 million, at March 31, 2022 and December 31, 2021, respectively. As of March 31, 2022 and December 31, 2021, these amounts exclude customer receivables reclassified as held for sale of $93 million and $83 million respectively.
(2)As of March 31, 2022 and December 31, 2021, no amounts have been reclassified as held for sale.
(3)As of March 31, 2022 and December 31, 2021, amounts exclude contract liabilities reclassified as held for sale of $59 million and $58 million respectively.
Contract liabilities are consideration we have received from our customers or billed in advance of providing the goods or services promised in the future. We defer recognizing this consideration until we have satisfied the related performance obligation to the customer. Contract liabilities include recurring services billed one month in advance and installation and maintenance charges that are deferred and recognized over the actual or expected contract term, which typically ranges from one to five years depending on the service. Contract liabilities are included within deferred revenue and liabilities held for sale in our consolidated balance sheets. During the three months ended March 31, 2022, we recognized $85 million of revenue that was included in contract liabilities of $305 million as of January 1, 2022, including contract liabilities that were classified as held for sale. During the three months ended March 31, 2021, we recognized $93 million of revenue that was included in contract liabilities of $385 million as of January 1, 2021.

Performance Obligations

As of March 31, 2022, our estimated revenue expected to be recognized in the future related to performance obligations associated with existing customer contracts that are partially or wholly unsatisfied is approximately $3.4 billion. We expect to recognize approximately 92% of this revenue through 2024, with the balance recognized thereafter.

These amounts exclude (i) the value of unsatisfied performance obligations for contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed (for example, uncommitted usage or non-recurring charges associated with professional or technical services to be completed), (ii) contracts that are classified as leasing arrangements that are not subject to ASC 606 and (iii) the value of unsatisfied performance obligations for contracts which relate to our planned divestiture.

Contract Costs

The following table provides changes in our contract acquisition costs and fulfillment costs:
Three Months Ended March 31, 2022Three Months Ended March 31, 2021
Acquisition Costs
Fulfillment Costs (1)
Acquisition CostsFulfillment Costs
(Dollars in millions)
Beginning of period balance$76 99 78 122 
Costs incurred15 21 14 23 
Amortization(14)(20)(17)(22)
End of period balance$77 100 75 123 
(1)Both the beginning and ending balances for the three months ended March 31, 2022 excluded fulfillment costs reclassified as held for sale of $27 million.

Acquisition costs include commission fees paid to employees as a result of obtaining contracts. Fulfillment costs include third party and internal costs associated with the provision, installation and activation of services to customers, including labor and materials consumed for these activities.

Deferred acquisition and fulfillment costs are amortized based on the transfer of services on a straight-line basis over the average expected contract life of approximately 34 months for our business customers. Amortized fulfillment costs are included in cost of services and products, and amortized acquisition costs are included in selling, general and administrative expenses in our consolidated statements of operations. The amount of these deferred costs that are anticipated to be amortized in the next 12 months are included in other current assets on our consolidated balance sheets. The amount of deferred costs expected to be amortized beyond 12 months is included in other non-current assets on our consolidated balance sheets. Deferred acquisition and fulfillment costs are assessed for impairment on an annual basis.
v3.22.1
Credit Losses on Financial Instruments
 3 Months Ended
Mar. 31, 2022
Credit Loss [Abstract]  
Credit Losses on Financial Instruments Credit Losses on Financial Instruments
In accordance with ASC 326, "Financial Instruments - Credit Losses," we aggregate financial assets with similar risk characteristics to align our expected credit losses with the credit quality or deterioration over the life of such assets. We periodically monitor certain risk characteristics within our aggregated financial assets and revise their composition accordingly, to the extent internal and external risk factors change. Financial assets that do not share risk characteristics with other financial assets are evaluated separately. Our financial assets measured at amortized cost primarily consist of accounts receivable.

We use a loss rate method to estimate our allowance for credit losses. Our determination of the current expected credit loss rate begins with our review of historical loss experience as a percentage of accounts receivable. We measure our historical loss period based on the average days to recognize accounts receivable as credit losses. When asset specific characteristics and current conditions change from those in the historical period, due to changes in our credit and collections strategy, certain classes of aged balances, or credit loss and recovery policies, we perform a qualitative and quantitative assessment to adjust our historical loss rate. We use regression analysis to develop an expected loss rate using historical experience and economic data over a forecast period. We measure our forecast period based on the average days to collect payment on billed accounts receivable. To determine our current allowance for credit losses, we combine the historical and expected credit loss rates and apply them to our period end accounts receivable.

If there is an unexpected deterioration of a customer's financial condition or an unexpected change in economic conditions (including changes caused by COVID-19 or other macroeconomic events), we assess the need to adjust the allowance for credit losses. Any such resulting adjustments would affect earnings in the period that adjustments are made.

The assessment of the correlation between historical observed default rates, current conditions and forecasted economic conditions requires judgment. Alternative interpretations of these factors could have resulted in different conclusions regarding the allowance for credit losses. The amount of credit loss is sensitive to changes in circumstances and forecasted economic conditions. Our historical credit loss experience, current conditions and forecast of economic conditions may also not be representative of the customers' actual default experience in the future and we may use methodologies that differ from those used by other companies.

The following table presents the activity of our allowance for credit losses for our accounts receivable portfolio:
(Dollars in millions)
Beginning balance at December 31, 2021
$39 
Provision for expected losses2 
Write-offs charged against the allowance(5)
Ending balance at March 31, 2022
$36 
(1)As of both March 31, 2022 and December 31, 2021, amount excludes allowance for credit losses classified as held for sale of $3 million. See Note 2—Planned Divestiture of the Latin American Business.
v3.22.1
Long-Term Debt
 3 Months Ended
Mar. 31, 2022
Debt Disclosure [Abstract]  
Long-Term Debt Long-Term Debt
The following chart reflects our consolidated long-term debt, including finance leases and other obligations, unamortized discounts and premiums, net and unamortized debt issuance costs, but excluding intercompany debt:
Interest Rates (1)
Maturities (1)
March 31, 2022December 31, 2021
(Dollars in millions)
Level 3 Financing, Inc.
Senior Secured Debt: (2)
Senior notes
3.400% - 3.875%
2027 - 2029
$1,500 1,500 
Tranche B 2027 Term Loan (3)
LIBOR + 1.75%
2027
3,111 3,111 
Senior Notes and other debt:
Senior notes (4)
3.625% - 5.375%
2025 - 2029
5,515 5,515 
Finance leases and other obligationsVariousVarious316 319 
Unamortized premiums, net32 34 
Unamortized debt issuance costs(55)(57)
Total long-term debt10,419 10,422 
Less current maturities(29)(26)
Long-term debt, excluding current maturities$10,390 10,396 
______________________________________________________________________
(1)As of March 31, 2022.
(2)See Note 7—Long-Term Debt in our Annual Report on Form 10-K for the year ended December 31, 2021 for a description of certain parent or subsidiary guarantees and liens securing this debt.
(3)The Tranche B 2027 Term Loan had an interest rate of 2.207% and 1.854% as of March 31, 2022 and December 31, 2021, respectively.
(4)This debt is fully and unconditionally guaranteed by certain affiliates of Level 3 Financing, Inc., including Level 3 Parent, LLC and Level 3 Communications, LLC.

Long-Term Debt Maturities

Set forth below is the aggregate principal amount of our long-term debt as of March 31, 2022 (excluding unamortized premiums, net, unamortized debt issuance costs, and intercompany debt), maturing during the following years:

(Dollars in millions)
2022 (remaining nine months)$23 
202327 
202432 
2025838 
2026811 
2027 and thereafter8,711 
Total long-term debt$10,442 
Covenants

The term loan and senior notes of Level 3 Financing, Inc. contain extensive affirmative and negative covenants. Such covenants include, among other things and subject to certain significant exceptions, restrictions on their ability to declare or pay dividends, repay certain other indebtedness, create liens, incur additional indebtedness, make investments, engage in transactions with their affiliates including Lumen Technologies and its other subsidiaries, dispose of assets and merge or consolidate with any other person. Also, in connection with a "change of control" of Level 3 Parent, LLC, or Level 3 Financing, Inc., Level 3 Financing will be required to offer to repurchase or repay certain of its long-term debt at a price of 101% of the principal amount of debt repurchased or repaid, plus accrued and unpaid interest.

Certain of Lumen's and our debt instruments contain cross-acceleration provisions.

Compliance

As of March 31, 2022, we believe we were in compliance with the provisions and financial covenants contained in our debt agreements in all material respects.
v3.22.1
Fair Value of Financial Instruments
 3 Months Ended
Mar. 31, 2022
Fair Value Disclosures [Abstract]  
Fair Value of Financial Instruments Fair Value of Financial Instruments
Our financial instruments consist of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, note receivable-affiliate and long-term debt, excluding finance leases and other obligations. Due to their short-term nature, the carrying amounts of our cash and cash equivalents, restricted cash, accounts receivable, note receivable-affiliate and accounts payable approximate their fair values.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between independent and knowledgeable parties who are willing and able to transact for an asset or liability at the measurement date. We use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs when determining fair value and then we rank the estimated values based on the reliability of the inputs used following the fair value hierarchy.

We determined the fair values of our long-term debt, including the current portion, based primarily on inputs other than quoted market prices in active markets that are either directly or indirectly observable such as discounted future cash flows using current market interest rates.

The three input levels in the hierarchy of fair value measurements are defined by the FASB are generally as follows:
Input LevelDescription of Input
Level 1Observable inputs such as quoted market prices in active markets.
Level 2Inputs other than quoted prices in active markets that are either directly or indirectly observable.
Level 3Unobservable inputs in which little or no market data exists.

The following table presents the carrying amounts and estimated fair values of our financial liabilities as of March 31, 2022 and December 31, 2021, as well as the input level used to determine the fair values indicated below:
March 31, 2022December 31, 2021
Input LevelCarrying AmountFair ValueCarrying AmountFair Value
(Dollars in millions)
Liabilities-Long-term debt, excluding finance leases2$10,103 9,601 10,103 10,090 
v3.22.1
Commitments, Contingencies and Other Items
 3 Months Ended
Mar. 31, 2022
Commitments and Contingencies Disclosure [Abstract]  
Commitments, Contingencies and Other Items Commitments, Contingencies and Other Items
We are subject to various claims, legal proceedings and other contingent liabilities, including the matters described below, which individually or in the aggregate could materially affect our financial condition, future results of operations or cash flows. As a matter of course, we are prepared to both litigate these matters to judgment as needed, as well as to evaluate and consider reasonable settlement opportunities.

Irrespective of its merits, litigation may be both lengthy and disruptive to our operations and could cause significant expenditure and diversion of management attention. We review our litigation accrual liabilities on a quarterly basis, but in accordance with applicable accounting guidelines only establish accrual liabilities when losses are deemed probable and reasonably estimable and only revise previously established accrual liabilities when warranted by changes in circumstances, in each case based on then-available information. As such, as of any given date we could have exposure to losses under proceedings as to which no liability has been accrued or as to which the accrued liability is inadequate. Amounts accrued for our litigation and non-income tax contingencies at March 31, 2022 aggregated to approximately $42 million and are included in other current liabilities, other liabilities, or liabilities held for sale in our consolidated balance sheet as of such date. The establishment of an accrual does not mean that actual funds have been set aside to satisfy a given contingency. Thus, the resolution of a particular contingency for the amount accrued could have no effect on our results of operations but nonetheless could have an adverse effect on our cash flows.

Telephone Consumer Protection Act Litigation

In December 2020, Lumen was named as a defendant in Diana Mey v. CenturyLink Communications, LLC, et al., an action pending in the US District Court for the Northern District of West Virginia alleging violations of the Telephone Consumer Protection Act for delivering unsolicited calls to her mobile phone. She asserts claims on behalf of herself and a putative class of similarly situated persons. The complaint seeks damages, statutory awards, costs and fees, and other relief. We are defending the claims asserted.

Peruvian Tax Litigation

In 2005, the Peruvian tax authorities ("SUNAT") issued tax assessments against one of our Peruvian subsidiaries asserting $26 million of additional income tax withholding and value-added taxes ("VAT"), penalties and interest for calendar years 2001 and 2002 on the basis that the Peruvian subsidiary incorrectly documented its importations. In May 2021, the Company paid the remaining amount on the fractioning regimes entered into by the Company to pay the amount assessed while it was appealed.

We challenged the assessments via administrative and then judicial review processes. In October 2011, the highest administrative review tribunal (the Tribunal) decided the central issue underlying the 2002 assessments in SUNAT's favor. We appealed the Tribunal's decision to the first judicial level, which decided the central issue in favor of Level 3. SUNAT and we filed cross-appeals with the court of appeal. In May 2017, the court of appeal issued a decision reversing the first judicial level. In June 2017, we filed an appeal of the decision to the Supreme Court of Justice, the final judicial level. Oral argument was held before the Supreme Court of Justice in October 2018. A decision on this case is pending.

In October 2013, the Tribunal decided the central issue underlying the 2001 assessments in SUNAT’s favor. We appealed that decision to the first judicial level in Peru, which decided the central issue in favor of SUNAT. In June 2017, we filed an appeal with the court of appeal. In November 2017, the court of appeals issued a decision affirming the first judicial level and we filed an appeal of the decision to the Supreme Court of Justice. Oral argument was held before the Supreme Court of Justice in June 2019. In May 2021, the Company was served with a favorable and final decision from the Supreme Court of Justice. The Company has provided SUNAT the additional information requested about tax payments made in 2001.
Brazilian Tax Claims

The São Paulo and Rio de Janeiro state tax authorities have issued tax assessments against our Brazilian subsidiaries for the Tax on Distribution of Goods and Services (“ICMS”), mainly with respect to revenue from leasing certain assets and revenue from the provision of Internet access services by treating such activities as the provision of communications services, to which the ICMS tax applies. We filed objections to these assessments in both states, arguing, among other things that neither the lease of assets nor the provision of Internet access qualifies as “communication services” subject to ICMS.

We have appealed to the respective state judicial courts the decisions by the respective state administrative courts that rejected our objections to these assessments. In cases in which state lower courts ruled partially in our favor finding that the lease assets are not subject to ICMS, in connection, the State appealed those rulings. In other cases, the assessment was affirmed at the first administrative level and we have appealed to the second administrative level. Other assessments are still pending state judicial decisions.

We are vigorously contesting all such assessments in both states and view the assessment of ICMS on revenue from equipment leasing and Internet access to be without merit. These assessments, if upheld, could result in a loss of up to $51 million as of March 31, 2022, in excess of the reserved accruals established for these matters.

Other Proceedings, Disputes and Contingencies

From time to time, we are involved in other proceedings incidental to our business, including patent infringement allegations, regulatory hearings relating primarily to our rates or services, actions relating to employee claims, various tax issues, environmental law issues, grievance hearings before labor regulatory agencies and miscellaneous third-party tort actions.

We are currently defending several patent infringement lawsuits asserted against us by non-practicing entities, many of which are seeking substantial recoveries. These cases have progressed to various stages and one or more may go to trial within the next twelve months if they are not otherwise resolved. Where applicable, we are seeking full or partial indemnification from our vendors and suppliers. As with all litigation, we are vigorously defending these actions and, as a matter of course, are prepared to litigate these matters to judgment, as well as to evaluate and consider all reasonable settlement opportunities.

We are subject to various foreign, federal, state and local environmental protection and health and safety laws. From time to time, we are subject to judicial and administrative proceedings brought by various governmental authorities under these laws. Several such proceedings are currently pending, but none is reasonably expected to exceed $300,000 in fines and penalties.

The outcome of these other proceedings described under this heading is not predictable. However, based on current circumstances, we do not believe that the ultimate resolution of these other proceedings, after considering available defenses and any insurance coverage or indemnification rights, will have a material adverse effect on us.

The matters listed in this Note do not reflect all of our contingencies. For additional information on our contingencies, see Note 16—Commitments, Contingencies and Other Items to the consolidated financial statements included in Item 8 of Part II of our Annual Report on Form 10-K for the year ended December 31, 2021. The ultimate outcome of the above-described matters may differ materially from the outcomes anticipated, estimated, projected or implied by us in certain of our statements appearing above in this Note, and proceedings currently viewed as immaterial by us may ultimately materially impact us.
v3.22.1
Accumulated Other Comprehensive Loss
 3 Months Ended
Mar. 31, 2022
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]  
Accumulated Other Comprehensive Loss Accumulated Other Comprehensive Loss
The table below summarizes changes in accumulated other comprehensive loss recorded on our consolidated balance sheets by component for the three months ended March 31, 2022:
Pension PlansForeign Currency Translation Adjustment and OtherTotal
(Dollars in millions)
Balance at December 31, 2021$3 (354)(351)
Other comprehensive income, net of tax— 69 69 
Net other comprehensive income— 69 69 
Balance at March 31, 2022$3 (285)(282)

The table below summarizes changes in accumulated other comprehensive loss recorded on our consolidated balance sheets by component for the three months ended March 31, 2021:
Pension PlansForeign Currency Translation Adjustment and OtherTotal
(Dollars in millions)
Balance at December 31, 2020$(13)(221)(234)
Other comprehensive loss, net of tax— (88)(88)
Net other comprehensive loss— (88)(88)
Balance at March 31, 2021$(13)(309)(322)
v3.22.1
Other Financial Information
 3 Months Ended
Mar. 31, 2022
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Other Financial Information Other Financial Information
Other Current Assets

The following table presents details of other current assets reflected in our consolidated balance sheets:

March 31, 2022December 31, 2021
(Dollars in millions)
Prepaid expenses$140 109 
Contract fulfillment costs49 48 
Contract acquisition costs45 45 
Contract assets28 28 
Other14 9 
Total other current assets$276 239 
_______________________________________________________________________________
(1)As of March 31, 2022 and December 31, 2021, other current assets excludes $83 million and $81 million respectively, that have been reclassified as held for sale.
v3.22.1
Subsequent Events
 3 Months Ended
Mar. 31, 2022
Subsequent Events [Abstract]  
Subsequent Events Subsequent EventsAs of the date of this report, $100 million of distributions were made to our parent in the second quarter of 2022.
v3.22.1
Background (Policies)
 3 Months Ended
Mar. 31, 2022
Accounting Policies [Abstract]  
Basis of Presentation
Basis of Presentation

Our consolidated balance sheet as of December 31, 2021, which was derived from our audited consolidated financial statements, and our unaudited interim consolidated financial statements provided herein have been prepared in accordance with the instructions for Form 10-Q. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been condensed or omitted pursuant to rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). However, in our opinion, the disclosures made therein are adequate to make the information presented not misleading. We believe these consolidated financial statements include all normal recurring adjustments necessary to fairly present the results for the interim periods. The consolidated results of operations and cash flows for the first three months of the year are not necessarily indicative of the consolidated results of operations and cash flows that might be expected for the entire year. These consolidated financial statements and the accompanying notes should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2021.

The accompanying consolidated financial statements include our accounts and the accounts of our subsidiaries in which we have a controlling interest. Intercompany amounts and transactions with our consolidated subsidiaries have been eliminated. Transactions with our non-consolidated affiliates (Lumen Technologies and its other subsidiaries, referred to herein as affiliates) have not been eliminated.
Segments
Segments

Our operations are integrated into and reported as part of Lumen Technologies. Lumen's chief operating decision maker ("CODM") is our CODM, but reviews our financial information on an aggregate basis only in connection with our quarterly and annual reports that we file with the SEC. Consequently, we do not provide our discrete financial information to the CODM on a regular basis. As such, we have one reportable segment.
Recently Adopted and Issued Accounting Pronouncements
Recently Adopted Accounting Pronouncements

Government Assistance

On January 1, 2022, we adopted Accounting Standards Update ("ASU") 2021-10, "Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance” (“ASU 2020-10”). This ASU increases transparency in financial reporting by requiring business entities to disclose information about certain types of government assistance they receive. The ASU only impacts annual financial statement note disclosures. Therefore, the adoption of ASU 2021-10 did not have a material impact to our consolidated financial statements.

Leases

On January 1, 2022, we adopted ASU 2021-05, “Leases (Topic 842): Lessors—Certain Leases with Variable Lease Payments” (“ASU 2021-05”). This ASU (i) amends the lease classification requirements for lessors to align them with practice under ASC Topic 840, (ii) provides criteria for lessors to classify and account for a lease with variable lease payments that do not depend on a reference index or a rate as an operating lease; and (iii) when a lease is classified as operating, the lessor does not recognize a net investment in the lease, does not derecognize the underlying asset, and, therefore, does not recognize a selling profit or loss. The adoption of ASU 2021-05 did not have a material impact to our consolidated financial statements.

Debt

On January 1, 2021, we adopted ASU 2020-09, “Debt (Topic 470) Amendments to SEC Paragraphs Pursuant to SEC Release No. 33-10762” (“ASU 2020-09”). This ASU amends and supersedes various SEC guidance to reflect SEC Release No. 33-10762, which includes amendments to the financial disclosure requirements applicable to registered debt offerings that include credit enhancements, such as subsidiary guarantees. The adoption of ASU 2020-09 did not have a material impact to our consolidated financial statements.

Investments

On January 1, 2021, we adopted ASU 2020-01, “Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)” (ASU 2020-01”). This ASU, among other things, clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investments - Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. As of March 31, 2022, we determined there was no application or discontinuation of the equity method during the reporting periods covered by this report. The adoption of ASU 2020-01 did not have a material impact to our consolidated financial statements.

Income Taxes

On January 1, 2021, we adopted ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”).This ASU removes certain exceptions for investments, intra-period allocations and interim calculations, and adds guidance to reduce complexity in accounting for income taxes. The adoption of ASU 2019-12 did not have a material impact to our consolidated financial statements.

Recently Issued Accounting Pronouncements

In March 2022, the Financial Accounting Standards Board ("FASB") issued ASU 2022-02, “Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings (“TDR”) and Vintage Disclosures” (“ASU 2022-02”). These amendments eliminate the TDR recognition and measurement guidance and enhance existing disclosure requirements and introduce new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. ASU 2020-02 will become effective for us in the first quarter of fiscal 2023 and early adoption is permitted. As of March 31, 2022, we do not expect ASU 2022-02 to have an impact to our consolidated financial statements.
In March 2022, the FASB issued ASU 2022-01, “Derivatives and Hedging (Topic 815): Fair Value Hedging-Portfolio Layer Method” (ASU 2022-01). The ASU expands the current single-layer method to allow multiple hedged layers of a single closed portfolio under the method. ASU 2020-01 will become effective for us in the first quarter of fiscal 2023 and early adoption is permitted. As of March 31, 2022, we do not expect ASU 2022-01 to have an impact to our consolidated financial statements.

In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers” (“ASU 2021-08”), which requires entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. ASU 2021-08 will become effective for us in the first quarter of fiscal 2023 and early adoption is permitted. As of March 31, 2022, we do not expect ASU 2021-08 to have an impact to our consolidated financial statements.

In January 2021, the FASB issued ASU 2021-01, "Reference Rate Reform (Topic 848): Scope" ("ASU 2021-01"), which clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. ASU 2021-01 also amends the expedients and exceptions in Topic 848 to capture the incremental consequences of the scope clarification and to tailor the existing guidance to derivative instruments affected by the discounting transition. These amendments may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. ASU 2021-01 provides option guidance for a limited time to ease the potential burden in accounting for reference rate reform. Based on our review of our key material contracts through March 31, 2022, we do not expect ASU 2021-01 to have a material impact to our consolidated financial statements.
Goodwill We assess our goodwill for impairment annually, or under certain circumstances, more frequently, such as when events or changes in circumstances indicate there may be impairment. We are required to write down the value of goodwill only when our assessment determines the carrying value of equity of our reporting unit exceeds its fair value. Our annual impairment assessment date for goodwill is October 31, at which date we assess goodwill at our reporting unit.
Operating Lease Income
Operating Lease Income

We lease various dark fiber, office facilities, colocation facilities, switching facilities, other network sites and service equipment to third parties under operating leases. Lease and sublease revenue are included in operating revenue in our consolidated statements of operations.
Credit Losses on Financial Instruments In accordance with ASC 326, "Financial Instruments - Credit Losses," we aggregate financial assets with similar risk characteristics to align our expected credit losses with the credit quality or deterioration over the life of such assets. We periodically monitor certain risk characteristics within our aggregated financial assets and revise their composition accordingly, to the extent internal and external risk factors change. Financial assets that do not share risk characteristics with other financial assets are evaluated separately. Our financial assets measured at amortized cost primarily consist of accounts receivable.
v3.22.1
Planned Divestiture of Latin American Business (Tables)
 3 Months Ended
Mar. 31, 2022
Discontinued Operations and Disposal Groups [Abstract]  
Components of pre-tax income and held for sale assets and liabilities The pre-tax net income of the Latin American business is estimated to be as follows in the table below:
Three Months Ended March 31,
20222021
(Dollars in millions)
Pre-tax net income $83 28 
The principal components of the held for sale assets and liabilities are as follows:

March 31, 2022December 31, 2021
(Dollars in millions)
Assets held for sale
Cash and cash equivalents$58 39 
Accounts receivable, less allowance of $3 and $3
93 83 
Other current assets83 81 
Property, plant and equipment, net accumulated depreciation of $456 and $434
1,704 1,591 
Goodwill (1)
733 713 
Customer relationships and other intangibles, net138 126 
Other non-current assets83 75 
Total assets held for sale$2,892 2,708 
Liabilities held for sale
Accounts payable$90 101 
Salaries and benefits25 23 
Income and other taxes34 27 
Current portion of deferred revenue26 26 
Other current liabilities7 7 
Deferred income taxes, net148 129 
Other non-current liabilities134 122 
Total liabilities held for sale$464 435 
______________________________________________________________________
(1)    The assignment of goodwill was based on the relative fair value of the disposal group and the portion of the remaining reporting unit.
v3.22.1
Goodwill, Customer Relationships and Other Intangible Assets (Tables)
 3 Months Ended
Mar. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of goodwill, customer relationships and other intangible assets
Goodwill, customer relationships and other intangible assets consisted of the following:
March 31, 2022December 31, 2021
(Dollars in millions)
Goodwill$6,655 6,666 
Customer relationships, less accumulated amortization of $2,949 and $2,779
$5,147 5,325 
Capitalized software, less accumulated amortization of $356 and $349
386 378 
Trade names, less accumulated amortization of $115 and $109
15 22 
Total other intangible assets, net$5,548 5,725 
Schedule of goodwill
The following table shows the rollforward of goodwill from December 31, 2021 through March 31, 2022:
(Dollars in millions)
As of December 31, 2021 (1)
$6,666 
Effect of foreign currency exchange rate changes(11)
As of March 31, 2022 (1)
$6,655 
_______________________________________________________________________________
(1)Goodwill at March 31, 2022 and December 31, 2021 is net of accumulated impairment loss of $3.6 billion.
Schedule of estimated amortization expense for intangible assets
We estimate that total amortization expense for intangible assets for the years ending December 31, 2022 through 2026 will be as provided in the table below. As a result of reclassifying our Latin American business as being held for sale on our March 31, 2022 consolidated balance sheet, the amounts presented below do not include the future amortization of the intangible assets for the business to be divested. See Note 2—Planned Divestiture of the Latin American Business for more information.
(Dollars in millions)
2022 (remaining nine months)$550 
2023713 
2024709 
2025684 
2026641 
v3.22.1
Revenue Recognition (Tables)
 3 Months Ended
Mar. 31, 2022
Revenue from Contract with Customer [Abstract]  
Disaggregation of revenue
The following table provides disaggregation of revenue from contracts with customers based on service offering for the three months ended March 31, 2022 and 2021. It also shows the amount of revenue that is not subject to ASC 606, but is instead governed by other accounting standards:
Three Months Ended March 31, 2022Three Months Ended March 31, 2021
Total Revenue
Adjustments for Non-ASC 606 Revenue(1)
Total Revenue from Contracts with CustomersTotal Revenue
Adjustments for Non-ASC 606 Revenue(1)
Total Revenue from Contracts with Customers
(Dollars in millions)
Compute and Application Services$277 (128)149 280 (127)153 
IP and Data Services886 — 886 881 — 881 
Fiber Infrastructure Services391 (54)337 397 (53)344 
Voice and Other336 (4)332 376 (2)374 
Affiliate Services56 (56)— 55 (55)— 
Total revenue$1,946 (242)1,704 1,989 (237)1,752 
_____________________________________________________________________
(1) Includes lease revenue which is not within the scope of ASC 606.
Contract with customer, asset and liability
The following table provides balances of customer receivables, contract assets and contract liabilities, net of amounts reclassified as held for sale as of March 31, 2022 and December 31, 2021:
March 31, 2022December 31, 2021
(Dollars in millions)
Customer receivables (1)
$548 640 
Contract assets (2)
34 35 
Contract liabilities (3)
236 247 
_____________________________________________________________________
(1)Reflects gross customer receivables of $584 million and $679 million, net of allowance for credit losses of $36 million and $39 million, at March 31, 2022 and December 31, 2021, respectively. As of March 31, 2022 and December 31, 2021, these amounts exclude customer receivables reclassified as held for sale of $93 million and $83 million respectively.
(2)As of March 31, 2022 and December 31, 2021, no amounts have been reclassified as held for sale.
(3)As of March 31, 2022 and December 31, 2021, amounts exclude contract liabilities reclassified as held for sale of $59 million and $58 million respectively.
Capitalized contract cost
The following table provides changes in our contract acquisition costs and fulfillment costs:
Three Months Ended March 31, 2022Three Months Ended March 31, 2021
Acquisition Costs
Fulfillment Costs (1)
Acquisition CostsFulfillment Costs
(Dollars in millions)
Beginning of period balance$76 99 78 122 
Costs incurred15 21 14 23 
Amortization(14)(20)(17)(22)
End of period balance$77 100 75 123 
(1)Both the beginning and ending balances for the three months ended March 31, 2022 excluded fulfillment costs reclassified as held for sale of $27 million.
v3.22.1
Credit Losses on Financial Instruments (Tables)
 3 Months Ended
Mar. 31, 2022
Credit Loss [Abstract]  
Activity in allowance for credit losses
The following table presents the activity of our allowance for credit losses for our accounts receivable portfolio:
(Dollars in millions)
Beginning balance at December 31, 2021
$39 
Provision for expected losses2 
Write-offs charged against the allowance(5)
Ending balance at March 31, 2022
$36 
(1)As of both March 31, 2022 and December 31, 2021, amount excludes allowance for credit losses classified as held for sale of $3 million. See Note 2—Planned Divestiture of the Latin American Business
v3.22.1
Long-Term Debt (Tables)
 3 Months Ended
Mar. 31, 2022
Debt Disclosure [Abstract]  
Schedule of long-term debt
The following chart reflects our consolidated long-term debt, including finance leases and other obligations, unamortized discounts and premiums, net and unamortized debt issuance costs, but excluding intercompany debt:
Interest Rates (1)
Maturities (1)
March 31, 2022December 31, 2021
(Dollars in millions)
Level 3 Financing, Inc.
Senior Secured Debt: (2)
Senior notes
3.400% - 3.875%
2027 - 2029
$1,500 1,500 
Tranche B 2027 Term Loan (3)
LIBOR + 1.75%
2027
3,111 3,111 
Senior Notes and other debt:
Senior notes (4)
3.625% - 5.375%
2025 - 2029
5,515 5,515 
Finance leases and other obligationsVariousVarious316 319 
Unamortized premiums, net32 34 
Unamortized debt issuance costs(55)(57)
Total long-term debt10,419 10,422 
Less current maturities(29)(26)
Long-term debt, excluding current maturities$10,390 10,396 
______________________________________________________________________
(1)As of March 31, 2022.
(2)See Note 7—Long-Term Debt in our Annual Report on Form 10-K for the year ended December 31, 2021 for a description of certain parent or subsidiary guarantees and liens securing this debt.
(3)The Tranche B 2027 Term Loan had an interest rate of 2.207% and 1.854% as of March 31, 2022 and December 31, 2021, respectively.
(4)This debt is fully and unconditionally guaranteed by certain affiliates of Level 3 Financing, Inc., including Level 3 Parent, LLC and Level 3 Communications, LLC.
Schedule of aggregate future contractual maturities of long-term debt and capital leases (excluding discounts) Set forth below is the aggregate principal amount of our long-term debt as of March 31, 2022 (excluding unamortized premiums, net, unamortized debt issuance costs, and intercompany debt), maturing during the following years:
(Dollars in millions)
2022 (remaining nine months)$23 
202327 
202432 
2025838 
2026811 
2027 and thereafter8,711 
Total long-term debt$10,442 
v3.22.1
Fair Value of Financial Instruments (Tables)
 3 Months Ended
Mar. 31, 2022
Fair Value Disclosures [Abstract]  
Schedule of carrying amounts and estimated fair values of long-term debt, excluding capital lease obligations, and input levels to determine fair values
The following table presents the carrying amounts and estimated fair values of our financial liabilities as of March 31, 2022 and December 31, 2021, as well as the input level used to determine the fair values indicated below:
March 31, 2022December 31, 2021
Input LevelCarrying AmountFair ValueCarrying AmountFair Value
(Dollars in millions)
Liabilities-Long-term debt, excluding finance leases2$10,103 9,601 10,103 10,090 
v3.22.1
Accumulated Other Comprehensive Loss (Tables)
 3 Months Ended
Mar. 31, 2022
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]  
Schedule of accumulated other comprehensive loss
The table below summarizes changes in accumulated other comprehensive loss recorded on our consolidated balance sheets by component for the three months ended March 31, 2022:
Pension PlansForeign Currency Translation Adjustment and OtherTotal
(Dollars in millions)
Balance at December 31, 2021$3 (354)(351)
Other comprehensive income, net of tax— 69 69 
Net other comprehensive income— 69 69 
Balance at March 31, 2022$3 (285)(282)

The table below summarizes changes in accumulated other comprehensive loss recorded on our consolidated balance sheets by component for the three months ended March 31, 2021:
Pension PlansForeign Currency Translation Adjustment and OtherTotal
(Dollars in millions)
Balance at December 31, 2020$(13)(221)(234)
Other comprehensive loss, net of tax— (88)(88)
Net other comprehensive loss— (88)(88)
Balance at March 31, 2021$(13)(309)(322)
v3.22.1
Other Financial Information (Tables)
 3 Months Ended
Mar. 31, 2022
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Schedule of components other current assets
The following table presents details of other current assets reflected in our consolidated balance sheets:

March 31, 2022December 31, 2021
(Dollars in millions)
Prepaid expenses$140 109 
Contract fulfillment costs49 48 
Contract acquisition costs45 45 
Contract assets28 28 
Other14 9 
Total other current assets$276 239 
_______________________________________________________________________________
(1)As of March 31, 2022 and December 31, 2021, other current assets excludes $83 million and $81 million respectively, that have been reclassified as held for sale.
v3.22.1
Background - Basis of Presentation (Details) - USD ($)
$ in Millions
Mar. 31, 2022
Dec. 31, 2021
Lessee, Lease, Description [Line Items]    
Operating lease, right-of-use asset, Statement of Financial Position [Extensible Enumeration] Other, net Other, net
Current operating lease liabilities $ 313 $ 299
Operating lease liabilities 1,009 953
Affiliates    
Lessee, Lease, Description [Line Items]    
Operating lease assets 346 294
Current operating lease liabilities 94 82
Operating lease liabilities $ 263 $ 224
v3.22.1
Background - Segments (Details)
 3 Months Ended
Mar. 31, 2022
segment
Accounting Policies [Abstract]  
Number of reportable segments 1
v3.22.1
Planned Divestiture of Latin American Business - Additional Information (Details) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2022
Mar. 31, 2021
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]      
Depreciation and amortization   $ 396 $ 437
Disposal Group, Held-for-sale, Not Discontinued Operations      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]      
Depreciation and amortization   49  
Disposal Group, Held-for-sale, Not Discontinued Operations | Latin American Business      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]      
Cash consideration for disposal of business $ 2,700 $ 2,700  
Working capital, other purchase price adjustments and transaction expenses $ 50    
v3.22.1
Planned Divestiture of Latin American Business - Pre-tax Net Income (Details) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
Disposal Group, Held-for-sale, Not Discontinued Operations    
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]    
Pre-tax net income $ 83 $ 28
v3.22.1
Planned Divestiture of Latin American Business - Components of Held for Sale Assets and Liabilities (Details) - USD ($)
$ in Millions
Mar. 31, 2022
Dec. 31, 2021
Mar. 31, 2021
Assets held for sale      
Cash and cash equivalents $ 58   $ 0
Other current assets 83 $ 81  
Disposal Group, Held-for-sale, Not Discontinued Operations | Latin American Business      
Assets held for sale      
Cash and cash equivalents 58 39  
Accounts receivable, less allowance of $3 and $3 93 83  
Other current assets 83 81  
Property, plant and equipment, net accumulated depreciation of $456 and $434 1,704 1,591  
Goodwill 733 713  
Customer relationships and other intangibles, net 138 126  
Other non-current assets 83 75  
Total assets held for sale 2,892 2,708  
Liabilities held for sale      
Accounts payable 90 101  
Salaries and benefits 25 23  
Income and other taxes 34 27  
Current portion of deferred revenue 26 26  
Other current liabilities 7 7  
Deferred income taxes, net 148 129  
Other non-current liabilities 134 122  
Total liabilities held for sale 464 435  
Allowance for doubtful accounts 3 3  
Accumulated depreciation $ 456 $ 434  
v3.22.1
Goodwill, Customer Relationships and Other Intangible Assets - Schedule of Goodwill and Other Intangible Assets (Details) - USD ($)
$ in Millions
Mar. 31, 2022
Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]    
Goodwill $ 6,655 $ 6,666
Other intangible assets, net 5,548 5,725
Customer relationships    
Finite-Lived Intangible Assets [Line Items]    
Other intangible assets, net 5,147 5,325
Accumulated amortization 2,949 2,779
Capitalized software    
Finite-Lived Intangible Assets [Line Items]    
Other intangible assets, net 386 378
Accumulated amortization 356 349
Trade names    
Finite-Lived Intangible Assets [Line Items]    
Other intangible assets, net 15 22
Accumulated amortization $ 115 $ 109
v3.22.1
Goodwill, Customer Relationships and Other Intangible Assets - Additional Information (Details)
$ in Millions
 3 Months Ended
Mar. 31, 2022
USD ($)
reporting_unit
Mar. 31, 2021
USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]    
Number of reporting units | reporting_unit 1  
Acquired finite-lived intangible asset amortization expense $ 192 $ 211
Intangible assets, gross, including goodwill $ 15,600  
v3.22.1
Goodwill, Customer Relationships and Other Intangible Assets - Goodwill Activity (Details)
$ in Millions
 3 Months Ended
Mar. 31, 2022
USD ($)
Goodwill [Roll Forward]  
As of December 31, 2020 $ 6,666
Effect of foreign currency exchange rate changes (11)
As of March 31, 2022 6,655
Goodwill, accumulated impairment loss $ 3,600
v3.22.1
Goodwill, Customer Relationships and Other Intangible Assets - Amortization Expense (Details)
$ in Millions
Mar. 31, 2022
USD ($)
Estimated amortization expense of finite-lived acquisition-related intangible assets  
2022 (remaining nine months) $ 550
2023 713
2024 709
2025 684
2026 $ 641
v3.22.1
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
Disaggregation of Revenue [Line Items]    
Total revenues $ 1,946 $ 1,989
Adjustments for non-ASC 606 revenue (242) (237)
Total revenue from contracts with customers 1,704 1,752
Compute and Application Services    
Disaggregation of Revenue [Line Items]    
Total revenues 277 280
Adjustments for non-ASC 606 revenue (128) (127)
Total revenue from contracts with customers 149 153
IP and Data Services    
Disaggregation of Revenue [Line Items]    
Total revenues 886 881
Adjustments for non-ASC 606 revenue 0 0
Total revenue from contracts with customers 886 881
Fiber Infrastructure Services    
Disaggregation of Revenue [Line Items]    
Total revenues 391 397
Adjustments for non-ASC 606 revenue (54) (53)
Total revenue from contracts with customers 337 344
Voice and Other    
Disaggregation of Revenue [Line Items]    
Total revenues 336 376
Adjustments for non-ASC 606 revenue (4) (2)
Total revenue from contracts with customers 332 374
Affiliate Services    
Disaggregation of Revenue [Line Items]    
Total revenues 56 55
Adjustments for non-ASC 606 revenue (56) (55)
Total revenue from contracts with customers $ 0 $ 0
v3.22.1
Revenue Recognition - Operating Lease Income (Details) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
Revenue from Contract with Customer [Abstract]    
Rental income $ 203 $ 197
Percent of operating revenue 10.00%  
v3.22.1
Revenue Recognition - Customer Receivables and Contract Balances (Details) - USD ($)
$ in Millions
Mar. 31, 2022
Jan. 01, 2022
Dec. 31, 2021
Jan. 01, 2021
Capitalized Contract Cost [Line Items]        
Customer receivables $ 548   $ 640  
Contract assets 34   35  
Contract liabilities 236 $ 305 247 $ 385
Accounts receivable, gross 584   679  
Allowance for credit losses 36   39  
Disposal Group, Held-for-sale, Not Discontinued Operations        
Capitalized Contract Cost [Line Items]        
Customer receivables 93   83  
Contract assets 0   0  
Contract liabilities $ 59   $ 58  
v3.22.1
Revenue Recognition - Additional Information - Customer Receivables and Contract Balances (Details) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
Jan. 01, 2022
Dec. 31, 2021
Jan. 01, 2021
Customer Receivables and Contract Balances [Line Items]          
Revenue recognized $ 85 $ 93      
Contract liabilities $ 236   $ 305 $ 247 $ 385
Minimum          
Customer Receivables and Contract Balances [Line Items]          
Contract term 1 year        
Maximum          
Customer Receivables and Contract Balances [Line Items]          
Contract term 5 years        
v3.22.1
Revenue Recognition - Additional Information - Remaining Performance Obligation (Details)
$ in Billions
Mar. 31, 2022
USD ($)
Revenue from Contract with Customer [Abstract]  
Remaining performance obligation $ 3.4
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-04-01  
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]  
Remaining performance obligation, percentage 92.00%
Expected timing of satisfaction, period 2 years 9 months
v3.22.1
Revenue Recognition - Contract Cost (Details) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
Acquisition Costs    
Capitalized Contract Cost [Roll Forward]    
Beginning of period balance $ 76 $ 78
Costs incurred 15 14
Amortization (14) (17)
End of period balance 77 75
Fulfillment Costs (1)    
Capitalized Contract Cost [Roll Forward]    
Beginning of period balance 99 122
Costs incurred 21 23
Amortization (20) (22)
End of period balance 100 $ 123
Fulfillment Costs (1) | Discontinued Operations, Held-for-sale    
Capitalized Contract Cost [Roll Forward]    
Beginning of period balance 27  
End of period balance $ 27  
v3.22.1
Revenue Recognition - Additional Information - Contract Costs (Details)
 3 Months Ended
Mar. 31, 2022
Business Customers | Weighted Average  
Contract Costs [Line Items]  
Length of customer life 34 months
v3.22.1
Credit Losses on Financial Instruments (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
Mar. 31, 2022
Dec. 31, 2021
Financing Receivable, Allowance for Credit Loss [Roll Forward]    
Beginning balance at December 31, 2021 $ 39  
Provision for expected losses 2  
Write-offs charged against the allowance (5)  
Ending balance at March 31, 2022 36 $ 39
Financing Receivable, Allowance for Credit Loss, Reclassification To Held-For-Sale $ 3 $ 3
v3.22.1
Long-Term Debt - Schedule of Long Term Debt (Details) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Dec. 31, 2021
Long-term debt    
Long-term debt, gross $ 10,442  
Unamortized premiums, net 32 $ 34
Unamortized debt issuance costs (55) (57)
Long-term Debt and Lease Obligation, Including Current Maturities, Total 10,419 10,422
Less current maturities (29) (26)
Long-term debt, excluding current maturities 10,390 10,396
Senior notes | Senior Notes Maturing 2027-2029    
Long-term debt    
Long-term debt, gross $ 1,500 1,500
Senior notes | Senior Notes Maturing 2027-2029 | Minimum    
Long-term debt    
Stated interest rate 3.40%  
Senior notes | Senior Notes Maturing 2027-2029 | Maximum    
Long-term debt    
Stated interest rate 3.875%  
Senior notes | Senior Notes Maturing 2025-2029    
Long-term debt    
Long-term debt, gross $ 5,515 5,515
Senior notes | Senior Notes Maturing 2025-2029 | Minimum    
Long-term debt    
Stated interest rate 3.625%  
Senior notes | Senior Notes Maturing 2025-2029 | Maximum    
Long-term debt    
Stated interest rate 5.375%  
Term loan | Tranche B 2027 Term Loan    
Long-term debt    
Long-term debt, gross $ 3,111 $ 3,111
Effective percentage 2.207% 1.854%
Term loan | Tranche B 2027 Term Loan | LIBOR    
Long-term debt    
Basis spread on variable rate 1.75%  
Finance leases and other obligations    
Long-term debt    
Long-term debt, gross $ 316 $ 319
v3.22.1
Long-Term Debt - Debt Maturities (Details)
$ in Millions
Mar. 31, 2022
USD ($)
Debt Disclosure [Abstract]  
2022 (remaining nine months) $ 23
2023 27
2024 32
2025 838
2026 811
2027 and thereafter 8,711
Total long-term debt $ 10,442
v3.22.1
Long-Term Debt - Additional Information (Details)
 3 Months Ended
Mar. 31, 2022
Long-term debt  
Redemption price, percentage 101.00%
v3.22.1
Fair Value of Financial Instruments (Details) - Fair Value, Measurements, Recurring - Significant Other Observable Inputs (Level 2) - USD ($)
$ in Millions
Mar. 31, 2022
Dec. 31, 2021
Carrying Amount    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis    
Liabilities-Long-term debt, excluding finance leases $ 10,103 $ 10,103
Fair Value    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis    
Liabilities-Long-term debt, excluding finance leases $ 9,601 $ 10,090
v3.22.1
Commitments, Contingencies and Other Items (Details)
 3 Months Ended
Mar. 31, 2022
USD ($)
patent
subsidiary
Loss Contingencies [Line Items]  
Estimated litigation liability $ 42,000,000
Number of patents allegedly infringed | patent 1
Unfavorable Regulatory Action  
Loss Contingencies [Line Items]  
Estimate of possible loss $ 300,000
Peruvian Tax Litigation, Before Interest | Pending Litigation  
Loss Contingencies [Line Items]  
Number of subsidiaries with tax assessment | subsidiary 1
Asserted claim $ 26,000,000
Brazilian Tax Claims | Maximum  
Loss Contingencies [Line Items]  
Estimate of possible loss $ 51,000,000
v3.22.1
Accumulated Other Comprehensive Loss (Details) - USD ($)
$ in Millions
 3 Months Ended
Mar. 31, 2022
Mar. 31, 2021
AOCI Attributable to Parent, Net of Tax [Roll Forward]    
Balance at beginning of period $ 13,009  
Other comprehensive income, net of tax 69 $ (88)
Net other comprehensive income 69 (88)
Balance at end of period 12,982 12,968
Pension Plans    
AOCI Attributable to Parent, Net of Tax [Roll Forward]    
Balance at beginning of period 3 (13)
Other comprehensive income, net of tax 0 0
Net other comprehensive income 0 0
Balance at end of period 3 (13)
Foreign Currency Translation Adjustment and Other    
AOCI Attributable to Parent, Net of Tax [Roll Forward]    
Balance at beginning of period (354) (221)
Other comprehensive income, net of tax 69 (88)
Net other comprehensive income 69 (88)
Balance at end of period (285) (309)
Total    
AOCI Attributable to Parent, Net of Tax [Roll Forward]    
Balance at beginning of period (351) (234)
Balance at end of period $ (282) $ (322)
v3.22.1
Other Financial Information (Details) - USD ($)
$ in Millions
Mar. 31, 2022
Dec. 31, 2021
Prepaid Expense and Other Assets, Current [Abstract]    
Prepaid expenses $ 140 $ 109
Contract assets 28 28
Other 14 9
Total other current assets 276 239
Other current assets 83 81
Fulfillment Costs (1)    
Prepaid Expense and Other Assets, Current [Abstract]    
Contract costs 49 48
Acquisition Costs    
Prepaid Expense and Other Assets, Current [Abstract]    
Contract costs $ 45 $ 45
v3.22.1
Subsequent Events (Details)
$ in Millions
 1 Months Ended
May 05, 2022
USD ($)
Subsequent Event  
Subsequent Event [Line Items]  
Payments of Distributions to Affiliates $ 100