LEVEL 3 COMMUNICATIONS INC, 10-Q filed on 11/6/2015
Quarterly Report
Document and Entity Information Document
9 Months Ended
Sep. 30, 2015
Nov. 4, 2015
Entity Information [Line Items]
 
 
Entity Registrant Name
LEVEL 3 COMMUNICATIONS INC 
 
Entity Central Index Key
0000794323 
 
Document Type
10-Q 
 
Document Period End Date
Sep. 30, 2015 
 
Amendment Flag
false 
 
Current Fiscal Year End Date
--12-31 
 
Entity Well-known Seasoned Issuer
Yes 
 
Entity Voluntary Filers
No 
 
Entity Current Reporting Status
Yes 
 
Entity Filer Category
Large Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
356,267,100 
Document Fiscal Year Focus
2015 
 
Document Fiscal Period Focus
Q3 
 
Consolidated Statements of Income (USD $)
In Millions, except Share data in Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Revenue
$ 2,062 
$ 1,629 
$ 6,176 
$ 4,863 
Costs and Expenses:
 
 
 
 
Network Access Costs
706 
607 
2,125 
1,834 
Network Related Expenses
369 
307 
1,088 
901 
Depreciation and Amortization
296 
187 
872 
558 
Selling, General and Administrative Expenses
364 
266 
1,098 
788 
Total Costs and Expenses
1,735 
1,367 
5,183 
4,081 
Operating Income
327 
262 
993 
782 
Other Income (Expense):
 
 
 
 
Interest Income
0 
1 
1 
1 
Interest Expense
(145)
(159)
(490)
(459)
Loss on Modification and Extinguishment of Debt
0 
0 
(163)
0 
Venezuela Deconsolidation Charge
(171)
0 
(171)
0 
Other, net
6 
(11)
(21)
(49)
Total Other Expense
(310)
(169)
(844)
(507)
Income Before Income Taxes
17 
93 
149 
275 
Income Tax Expense
(16)
(8)
(39)
(27)
Net Income
$ 1 
$ 85 
$ 110 
$ 248 
Net Income Per Share
$ 0.00 
$ 0.36 
$ 0.31 
$ 1.05 
Shares Used to Compute Basic Net Income per Share (in thousands)
355,791 
238,265 
352,411 
237,102 
Net Income Per Share
$ 0.00 
$ 0.35 
$ 0.31 
$ 1.03 
Shares Used to Compute Diluted Net Income per Share (in thousands)
358,714 
242,464 
355,453 
241,458 
Consolidated Statements of Comprehensive Income (Loss) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Net Income
$ 1 
$ 85 
$ 110 
$ 248 
Other Comprehensive Income (Loss) Before Income Taxes:
 
 
 
 
Foreign Currency Translation Adjustment
(73)
(138)
(130)
(120)
Other, net
1 
1 
2 
2 
Other Comprehensive Loss, Before Income Taxes
(72)
(137)
(128)
(118)
Income Tax Related to Items of Other Comprehensive Income (Loss)
0 
0 
0 
0 
Other Comprehensive Loss, Net of Income Taxes
(72)
(137)
(128)
(118)
Comprehensive Income (Loss)
$ (71)
$ (52)
$ (18)
$ 130 
Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Assets:
 
 
Cash and cash equivalents
$ 691 
$ 580 
Restricted cash and securities
7 
7 
Receivables, less allowances for doubtful accounts of $31 and $30, respectively
810 
737 
Other
155 
165 
Total Current Assets
1,663 
1,489 
Property, Plant and Equipment, net of accumulated depreciation of $10,160 and $9,629, respectively
9,812 
9,860 
Restricted Cash and Securities
44 
20 
Goodwill
7,753 
7,689 
Other Intangibles, net
1,182 
1,414 
Other Assets, net
429 
475 
Total Assets
20,883 
20,947 
Liabilities and Stockholders' Equity:
 
 
Accounts payable
630 
664 
Current portion of long-term debt
16 
349 
Accrued payroll and employee benefits
230 
273 
Accrued interest
137 
174 
Current portion of deferred revenue
273 
287 
Other
184 
167 
Total Current Liabilities
1,470 
1,914 
Long-Term Debt, less current portion
10,997 
10,984 
Deferred Revenue, less current portion
942 
921 
Other Liabilities
694 
765 
Total Liabilities
14,103 
14,584 
Commitments and Contingencies
   
   
Stockholders’ Equity:
 
 
Preferred stock, $.01 par value, authorized 10,000,000 shares: no shares issued or outstanding
0 
0 
Common stock, $.01 par value, authorized 433,333,333 shares in both periods; 355,932,791 issued and outstanding at September 30, 2015 and 341,361,420 issued and outstanding at December 31, 2014
4 
3 
Additional paid-in capital
19,593 
19,159 
Accumulated other comprehensive loss
(275)
(147)
Accumulated deficit
(12,542)
(12,652)
Total Stockholders’ Equity
6,780 
6,363 
Total Liabilities and Stockholders’ Equity
$ 20,883 
$ 20,947 
Consolidated Balance Sheets Parentheticals (Parentheticals) (USD $)
In Millions, except Share data, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Allowance for doubtful accounts
$ 31 
$ 30 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
$ 10,160 
$ 9,629 
Preferred stock, par value
$ 0.01 
$ 0.01 
Preferred stock, shares authorized
10,000,000 
10,000,000 
Preferred stock, shares issued
0 
0 
Preferred stock, shares outstanding
0 
0 
Common stock, par value
$ 0.01 
$ 0.01 
Common stock, shares authorized
433,333,333 
433,333,333 
Common stock, shares issued
355,932,791 
341,361,420 
Common stock, shares outstanding
355,932,791 
341,361,420 
Consolidated Statements of Cash Flows (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Cash Flows from Operating Activities:
 
 
Net Income
$ 110 
$ 248 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
Depreciation and amortization
872 
558 
Non-cash compensation expense attributable to stock awards
92 
48 
Loss on modification and extinguishment of debt
163 
0 
Venezuela deconsolidation charge
171 
0 
Accretion of debt discount and amortization of debt issuance costs
18 
27 
Accrued interest on long-term debt, net
(28)
24 
Non-cash tax adjustments
0 
(9)
Deferred income taxes
5 
2 
Loss (gain) on sale of property, plant and equipment and other assets
1 
(3)
Other, net
32 
(19)
Changes in working capital items:
 
 
Receivables
(130)
(25)
Other current assets
(21)
(31)
Accounts payable
(1)
(35)
Deferred revenue
59 
(29)
Other current liabilities
(44)
9 
Net Cash Provided by Operating Activities
1,299 
765 
Cash Flows from Investing Activities:
 
 
Capital expenditures
(899)
(608)
Cash related to deconsolidated Venezuela operations
(83)
0 
Increase in restricted cash and securities, net
(24)
(10)
Proceeds from sale of property, plant and equipment and other assets
3 
3 
Other
(14)
(2)
Net Cash Used in Investing Activities
(1,017)
(617)
Cash Flows from Financing Activities:
 
 
Long-term debt borrowings, net of issuance costs
3,947 
(1)
Payments on and repurchases of long-term debt, including current portion and refinancing costs
(4,102)
(8)
Net Cash Used in Financing Activities
(155)
(9)
Effect of Exchange Rates on Cash and Cash Equivalents
(16)
(41)
Net Change in Cash and Cash Equivalents
111 
98 
Cash and Cash Equivalents at Beginning of Period
580 
631 
Cash and Cash Equivalents at End of Period
691 
729 
Supplemental Disclosure of Cash Flow Information:
 
 
Cash interest paid
495 
408 
Income taxes paid, net of refunds
40 
34 
Non-cash Financing Activities:
 
 
Long-term debt issued and proceeds placed into escrow
0 
1,000 
Capital Lease Obligations Incurred
6 
2 
Long-term debt conversion into equity
333 
0 
Accrued interest conversion into equity
$ 10 
$ 0 
Organization and Summary of Significant Accounting Policies (Notes)
Organization and Summary of Significant Accounting Policies
Organization and Summary of Significant Accounting Policies

Description of Business

Level 3 Communications, Inc. and subsidiaries (the "Company" or "Level 3") is an international facilities-based provider (that is, a provider that owns or leases a substantial portion of the plant, property and equipment necessary to provide its services) of a broad range of integrated communications services. The Company created its communications network by constructing its own assets and through a combination of purchasing other companies and purchasing or leasing facilities from others. The Company designed its network to provide communications services that employ and take advantage of rapidly improving underlying optical, Internet Protocol, computing and storage technologies.

On October 31, 2014, the Company completed the acquisition of tw telecom inc. (“tw telecom”) and tw telecom became an indirect, wholly owned subsidiary of the Company through a tax-free, stock and cash reorganization (the "Merger"). See Note 2 - Events Associated with the Merger of tw telecom inc.

Principles of Consolidation and Basis of Presentation

The Consolidated Financial Statements include the accounts of Level 3 Communications, Inc. and subsidiaries in which it has a controlling interest. All significant intercompany accounts and transactions have been eliminated. The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP").

As part of its consolidation policy, the Company considers its controlled subsidiaries, investments in businesses in which the Company is not the primary beneficiary or does not have effective control but has the ability to significantly influence operating and financial policies, and variable interests resulting from economic arrangements that give the Company rights to economic risks or rewards of a legal entity. The Company does not have variable interests in a variable interest entity where it is required to consolidate the entity as the primary beneficiary or where it has concluded it is not the primary beneficiary.
    
Prior to October 1, 2015, the Company included the results of its wholly owned Venezuelan subsidiary in its Consolidated Financial Statements using the consolidation method of accounting. The Company’s Venezuelan subsidiary's earnings and cash flows are reflected in the Consolidated Financial Statements at the SICAD I exchange rate for the three and nine months ended September 30, 2015 and 2014, respectively. The consolidated results of operations include a $5 million charge related to the devaluation of the SICAD I exchange rate from 12.8 bolivars per U.S. dollar to 13.5 bolivars per U.S. dollar, which was effective September 1, 2015.
Venezuelan exchange control regulations have resulted in an other-than-temporary lack of exchangeability between the Venezuelan bolivar and U.S. dollar, and have restricted the Company's Venezuelan operations’ ability to pay dividends in U.S. dollars and settle intercompany obligations in U.S. dollars. The severe currency controls imposed by the Venezuelan government have significantly limited the ability to realize the benefits from earnings of the Company’s Venezuelan operations and access the resulting liquidity provided by those earnings in U.S. dollars. The Company expects that this condition will continue for the foreseeable future. Additionally, government regulations affecting the Company's ability to manage its Venezuelan subsidiary’s capital structure, purchasing, product pricing, customer invoicing and collections, and labor relations; and the current political and economic situation within Venezuela have resulted in an acute degradation in the Company's ability to make key operational decisions for its Venezuelan operations. This lack of exchangeability into U.S. dollars and the degradation in the Company's ability to control key operational decisions has resulted in a lack of control over the Company's Venezuelan subsidiary for U.S. accounting purposes. Therefore, while continuing to wholly own its Venezuelan subsidiary, in accordance with Accounting Standards Codification 810 -- Consolidation, the Company deconsolidated its Venezuelan subsidiary on September 30, 2015, and will begin accounting for its investment in its Venezuelan operations using the cost method of accounting.
As a result of deconsolidating of its Venezuelan subsidiary, the Company recorded a one-time charge of $171 million in the third quarter of 2015, which had no accompanying tax benefit. This charge included the write-off of both the Company's investment in its Venezuelan subsidiary and $40 million of intercompany receivables from its Venezuelan subsidiary. The Company's Venezuelan operations’ bolivar-denominated cash balance of $83 million (at the SICAD I exchange rate of 13.5 bolivars per U.S. dollar) at September 30, 2015 is no longer reported in Cash and Cash Equivalents on the Consolidated Balance Sheet. In future periods, the Company's financial results will not include the operating results of its Venezuelan operations. Any dividends from the Company's Venezuelan subsidiaries will be recorded as other income upon receipt of the cash. Prior period results have not been adjusted to reflect the deconsolidation of the Company's Venezuelan subsidiary. As a result of the deconsolidation of the Company's Venezuelan subsidiary, the Company completed an assessment of the Latin American reporting unit goodwill as of September 30, 2015 and concluded there was no impairment.
The accompanying Consolidated Balance Sheet as of December 31, 2014, which was derived from audited Consolidated Financial Statements, and the unaudited interim Consolidated Financial Statements as of September 30, 2015 and for the three and nine months ended September 30, 2015 and 2014 have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by GAAP for complete financial statements. These financial statements should be read in conjunction with the Company’s audited Consolidated Financial Statements and notes thereto included in the Company’s Form 10-K for the year ended December 31, 2014. In the opinion of the Company’s management, these financial statements contain all adjustments necessary for a fair presentation of financial position, results of operations and cash flows at the dates and for the interim periods presented herein. The results of operations for an interim period are not necessarily indicative of the results of operations expected for a full fiscal year.

The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses during the reported period. Actual results could differ from these estimates under different assumptions or conditions and such differences could be material.

Recently Issued Accounting Pronouncements

In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2015-03, Simplifying the Presentation of Debt Issuance Costs, which requires debt issuance costs to be presented in the balance sheet as a direct deduction from the associated debt liability. The new guidance is effective retrospectively for public companies for fiscal years beginning after December 15, 2015, and interim periods within those years. The adoption of this guidance is not expected to have a material effect on the Company's consolidated financial condition or have any effect on the Company’s consolidated results of operations.

In May 2014, the FASB issued ASU 2014-9, Revenue from Contracts with Customers, which amended the existing accounting standards for revenue recognition and requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. In July 2015, the FASB deferred the effective date to annual reporting periods beginning after December 15, 2017, and interim reporting periods within those periods. Early adoption is permitted using the original effective date of annual reporting periods beginning after December 15, 2016, and interim reporting periods within those periods. The new guidance may be applied retrospectively to each prior period presented or prospectively with the cumulative effect recognized as of the date of initial application. The Company does not expect to adopt the ASU early, has not yet selected a transition method and is currently evaluating the effect of adopting this ASU on its consolidated financial statements and related disclosures.

In September, the the FASB issued ASU No. 2015-16, Simplifying the Accounting for Measurement- Period Adjustments, which requires an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined and record, in the financial statements for the same period, the effect on earnings of changes in depreciation or amortization, or other income effects (if any) as a result of the change to the provisional amounts, calculated as though the accounting had been completed as of the acquisition date. The new guidance is effective prospectively for public companies for fiscal years beginning after December 15, 2015, and interim periods within those years. The adoption of this guidance is not expected to have a material effect on the Company's consolidated financial condition.
Events Associated with the Merger of tw telecom (Notes)
Business Combination Disclosure [Text Block]
Events Associated with the Merger of tw telecom inc.

On October 31, 2014, the Company completed its acquisition of tw telecom and tw telecom became an indirect, wholly owned subsidiary of the Company through a tax-free, stock and cash reorganization. As a result of the Merger, (1) each issued and outstanding share of common stock of tw telecom was exchanged for 0.7 shares of Level 3 common stock and $10 in cash (together the "merger consideration"); (2) the outstanding stock options of tw telecom were canceled and the holders received the merger consideration, net of aggregate per share exercise price; (3) each restricted stock unit award of tw telecom was immediately vested and canceled and the holders received the merger consideration; and (4) each restricted stock unit of tw telecom was immediately vested and canceled and holders received the merger consideration.

The combined results of operations of Level 3 and tw telecom were included in the Company's consolidated results of operations beginning in November 2014. The assets acquired and liabilities assumed of tw telecom were recognized at their acquisition date fair value. The purchase price allocation of acquired assets and assumed liabilities, including the assignment of goodwill to reporting units, requires extensive analysis and is expected to be completed in the fourth quarter of 2015. The following is a preliminary allocation of purchase price based on information currently available. The final identification of all the intangible assets acquired and determination of the purchase price allocation may differ from the preliminary allocation reflected below, however the Company does not expect that any subsequent modifications to the preliminary purchase price allocation will be material.
 
 
Purchase Price Allocation
 
 
(dollars in millions)
Assets:
 
 
Cash, Cash Equivalents and Restricted Cash
 
$
309

Property, Plant and Equipment
 
1,554

Goodwill
 
5,178

Identifiable Intangible Assets
 
1,263

Other Assets
 
142

Total Assets
 
8,446

 
 
 
Liabilities:
 
 
Long-Term Debt
 
(2,099
)
Deferred Revenue
 
(57
)
Other Liabilities
 
(279
)
Total Liabilities
 
(2,435
)
Total Consideration to be Allocated
 
$
6,011


As a result of new information available since the acquisition date, the Company made certain immaterial adjustments to the preliminary purchase price allocation during the first quarter of 2015, which have been reflected in the above table. The primary adjustment was a result of a single change in the purchase price allocation of $60 million related to the estimated value associated with the identifiable intangible assets and goodwill.

The following unaudited pro forma financial information presents the combined results of Level 3 and tw telecom as if the completion of the merger had occurred as of January 1, 2013 (dollars in millions, except per share data).
 
 
Three Months Ended September 30, 2014
Nine Months Ended September 30, 2014
Total Revenue
 
$
2,038

$
6,071

Net Income
 
$
81

$
229

Net Income per Share - Basic
 
$
0.24

$
0.69

Net Income per Share- Diluted
 
$
0.24

$
0.68


These pro forma results include certain adjustments, primarily due to increases in depreciation and amortization expense due to fair value adjustments of tangible and intangible assets, increases in interest expense due to Level 3's issuance of incremental debt to finance cash consideration partially offset by the refinancing of tw telecom debt that had higher interest rates than the incremental financing, and to eliminate historical transactions between Level 3 and tw telecom. The unaudited pro forma financial information is not intended to represent or be indicative of the actual results of operations of Level 3 that would have been reported had the Merger been completed on January 1, 2013, nor is it representative of future operating results of the Company. The unaudited pro forma financial information does not include any operating efficiencies or cost savings that Level 3 may achieve with respect to combining the companies.

Acquisition related costs include transaction costs such as legal, accounting, valuation and other professional services as well as integration costs such as severance and retention. Acquisition related costs have been recorded in Network Related Expenses and Selling, General and Administrative Expenses in the Company's Consolidated Statements of Income. Since the acquisition date, Level 3 incurred total acquisition related transaction and integration costs of approximately $109 million through September 30, 2015. In addition, Level 3 expects to incur additional integration related costs through the remainder of 2015.
Earnings Per Share (Notes)
Earnings Per Share
Per Share

The Company computes basic earnings per share by dividing net income (loss) for the period by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing the net income (loss) for the period by the weighted average number of shares of common stock outstanding during the period and including the dilutive effect of common stock that would be issued assuming conversion or exercise of outstanding convertible notes and stock-based compensation awards.

The effect of approximately 18 million shares issuable pursuant to the various series of convertible notes outstanding at September 30, 2014 has not been included in the computation of diluted earnings per share for the three and nine months ended September 30, 2014 because their inclusion would have been anti-dilutive to the computation. The effect of approximately 4 million and 5 million stock options, outperform stock appreciation rights ("OSOs"), and restricted stock units ("RSUs") outstanding at September 30, 2015 and 2014, respectively, have been included in the computation of diluted earnings per share.
Acquired Intangible Assets (Notes)
Acquired Intangible Assets
Acquired Intangible Assets

Identifiable acquisition-related intangible assets as of September 30, 2015 and December 31, 2014 were as follows (dollars in millions):

 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
September 30, 2015
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Customer Contracts and Relationships
$
1,975

 
$
(884
)
 
$
1,091

Trademarks
55

 
(55
)
 
—

Patents and Developed Technology
230

 
(154
)
 
76

 
2,260

 
(1,093
)
 
1,167

Indefinite-Lived Intangible Assets:
 
 
 
 
 
Trade Name
15

 
—

 
15

 
$
2,275

 
$
(1,093
)
 
$
1,182

December 31, 2014
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Customer Contracts and Relationships
$
1,977

 
$
(741
)
 
$
1,236

Trademarks
115

 
(47
)
 
68

Patents and Developed Technology
228

 
(133
)
 
95

 
2,320

 
(921
)
 
1,399

Indefinite-Lived Intangible Assets:
 
 
 
 
 
Trade Name
15

 
—

 
15

 
$
2,335

 
$
(921
)
 
$
1,414



Acquired finite-lived intangible asset amortization expense was $58 million and $172 million for the three and nine months ended September 30, 2015 and $14 million and $50 million for the three and nine months ended September 30, 2014.

At September 30, 2015, the weighted average remaining useful lives of the Company's acquired finite-lived intangible assets was 6.1 years for customer contracts and relationships and 3.4 years for patents and developed technology.

As of September 30, 2015, estimated amortization expense for the Company’s finite-lived acquisition-related intangible assets over the next five years is as follows (dollars in millions):

2015 (remaining three months)
$
54

2016
212

2017
196

2018
193

2019
182

2020
166

Thereafter
164

 
$
1,167




Fair Value of Financial Instruments (Notes)
Fair Value of Financial Instruments
Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents, restricted cash and securities, receivables, accounts payable, capital leases, other liabilities and long-term debt (including the current portion). The carrying values of cash and cash equivalents, restricted cash and securities, receivables, accounts payable, capital leases and other liabilities approximated their fair values at September 30, 2015 and December 31, 2014.

GAAP defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements and disclosures for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability, such as interest and foreign exchange rates, transfer restrictions, and risk of non-performance.

Fair Value Hierarchy

GAAP establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The fair value measurement of each class of assets and liabilities is dependent upon its categorization within the fair value hierarchy, based upon the lowest level of input that is significant to the fair value measurement of each class of asset and liability. GAAP establishes three levels of inputs that may be used to measure fair value:

Level 1— Unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2— Unadjusted quoted prices for similar assets or liabilities in active markets, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability.

Level 3— Unobservable inputs for the asset or liability.

The Company recognizes transfers between levels of the fair value hierarchy at the end of the reporting period. There were no transfers within the fair value hierarchy during each of the nine months ended September 30, 2015 and September 30, 2014.

The table below presents the fair values for the Company’s long-term debt as well as the input levels used to determine these fair values as of September 30, 2015 and December 31, 2014:

 
 
 
 
 
 
Fair Value Measurement Using
 
 
Total Carrying Value in Consolidated Balance Sheets
 
Unadjusted Quoted Prices in Active
Markets for Identical Assets or Liabilities (Level 1)
 
Significant Other Observable Inputs (Level 2)
(dollars in millions)
 
September 30,
2015
 
December 31,
2014
 
September 30,
2015
 
December 31,
2014
 
September 30,
2015
 
December 31,
2014
Liabilities Not Recorded at Fair Value in the Financial Statements:
 
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt, including the current portion:
 
 
 
 
 
 
 
 
 
 
 
 
Term Loans
 
$
4,594

 
$
4,590

 
$
4,589

 
$
4,593

 
$
—

 
$
—

Senior Notes
 
6,215

 
6,203

 
6,158

 
6,481

 
—

 
—

Convertible Notes
 
—

 
333

 
—

 
—

 
—

 
868

Capital Leases and Other
 
204

 
207

 
—

 
—

 
204

 
207

Total Long-term Debt, including the current portion
 
$
11,013

 
$
11,333

 
$
10,747

 
$
11,074

 
$
204

 
$
1,075



The Company does not have any assets or liabilities where the fair value is measured using significant unobservable inputs (Level 3).

Term Loans

The fair value of the Term Loans referenced above was approximately $4.6 billion at both September 30, 2015 and December 31, 2014. The fair value of each loan is based on quoted prices for identical terms and maturities. Each loan tranche is actively traded.

Senior Notes

The fair value of the Senior Notes referenced above was approximately $6.2 billion at September 30, 2015 and $6.5 billion at December 31, 2014, respectively, based on quoted prices for identical terms and maturities. Each series of notes is actively traded.

Convertible Notes

The fair value of the Company’s Convertible Notes was approximately $868 million at December 31, 2014. As of March 31, 2015, all of the Company's Convertible Notes had converted to common equity. The estimated fair value of the Convertible Notes is based on a Black-Scholes valuation model and an income approach using discounted cash flows. The most significant inputs affecting the valuation are the pricing quotes provided by market participants that incorporate spreads to the Treasury curve, security coupon, convertible optionality, corporate and security credit ratings, maturity date, liquidity and other equity option inputs, such as the risk-free rate, underlying stock price, strike price of the embedded derivative, estimated volatility and maturity inputs for the option component and for the bond component, among other security characteristics and relative value at both the borrower entity level and across other securities with similar terms. The fair value of each instrument is obtained by adding together the value derived by discounting the security’s coupon or interest payment using a risk-adjusted discount rate and the value calculated from the embedded equity option based on the estimated volatility of the Company’s stock price, conversion rate of the particular Convertible Note, remaining time to maturity and risk-free rate. The Convertible Notes were unsecured obligations of Level 3 Communications, Inc. No subsidiary of Level 3 Communications, Inc. provided a guarantee of the Convertible Notes.

Capital Leases

The fair value of the Company's capital leases was determined by discounting anticipated future cash flows derived from the contractual terms of the obligations and observable market interest and foreign exchange rates.
Long-Term Debt (Notes)
Long-term Debt
Long-Term Debt

As of September 30, 2015 and December 31, 2014, long-term debt was as follows:
(dollars in millions)
 
September 30,
2015
 
December 31,
2014
Senior Secured Term Loan*
 
$
4,611

 
$
4,611

Floating Rate Senior Notes due 2018 (3.914% as of September 30, 2015 and 3.826% as of December 31, 2014)
 
300

 
300

9.375% Senior Notes due 2019
 
—

 
500

8.125% Senior Notes due 2019
 
—

 
1,200

8.875% Senior Notes due 2019
 
—

 
300

8.625% Senior Notes due 2020
 
900

 
900

7% Senior Notes due 2020
 
775

 
775

6.125% Senior Notes due 2021
 
640

 
640

5.375% Senior Notes due 2022
 
1,000

 
1,000

5.75% Senior Notes due 2022
 
600

 
600

5.625% Senior Notes due 2023
 
500

 
—

5.125% Senior Notes due 2023
 
700

 
—

5.375% Senior Notes due 2025
 
800

 
—

7% Convertible Senior Notes due 2015
 
—

 
58

7% Convertible Senior Notes due 2015 Series B
 
—

 
275

Capital Leases
 
204

 
207

Total Debt Obligations
 
11,030

 
11,366

Unamortized Discount:
 
 
 
 
Discount on Senior Secured Term Loan
 
(17
)
 
(21
)
Discount on 9.375% Senior Notes due 2019
 
—

 
(6
)
Discount on 8.125% Senior Notes due 2019
 
—

 
(6
)
Total Unamortized Discount
 
(17
)
 
(33
)
Carrying Value of Debt
 
11,013

 
11,333

Less current portion
 
(16
)
 
(349
)
Long-term Debt, less current portion
 
$
10,997

 
$
10,984


* The $2 billion Tranche B Term Loan due 2022 had an interest rate of 4.5% as of December 31, 2014 and the $2 billion Tranche B-II Term Loan due 2022, which refinanced the Tranche B Term Loan due 2022 in full, had an interest rate of 3.5% as of September 30, 2015. The $815 million Tranche B-III Term Loan due 2019 and the $1.796 billion Tranche B Term Loan due 2020 each had an interest rate of 4.0% as of September 30, 2015 and December 31, 2014.

2015 Debt Issuances, Redemptions and Registrations

5.625% Senior Notes due 2023

In January 2015, the Company's wholly owned subsidiary, Level 3 Financing, Inc. (“Level 3 Financing”) issued $500 million in aggregate principal amount of its 5.625% Senior Notes due 2023 (the “5.625% Senior Notes”). The net proceeds from the offering of the 5.625% Senior Notes, together with cash on hand, were used to redeem, on April 1, 2015, all of Level 3 Financing’s approximately $500 million aggregate principal amount of 9.375% Senior Notes due 2019, including accrued interest, applicable premiums and expenses. Total loss on extinguishment of debt related to the 9.375% Senior Notes due 2019 was $36 million.

The 5.625% Senior Notes will mature on February 1, 2023. Interest on the 5.625% Senior Notes is payable on June 15 and December 15 of each year, beginning on June 15, 2015.

Debt issuance costs of approximately $9 million were capitalized and are being amortized over the term of the notes.

The 5.625% Senior Notes are subject to redemption at the option of Level 3 Financing, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days’ prior notice, (i) prior to February 1, 2018, at 100% of the principal amount of 5.625% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and (ii) on and after February 1, 2018, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, if redeemed during the twelve months beginning February 1, of the years indicated below:

Year
Redemption Price
2018
102.8125
%
2019
101.4063
%
2020 and thereafter
100.0000
%

At any time or from time to time on or prior to February 1, 2018, the Company may redeem up to 40% of the original aggregate principal amount of the 5.625% Senior Notes at a redemption price equal to 105.625% of the principal amount of the 5.625% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to Level 3 Financing of one or more private placements to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 60% of the original aggregate principal amount of the 5.625% Senior Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days following such private placement or public offering upon not less than 30 nor more than 60 days’ prior notice.
The notes are fully and unconditionally guaranteed on an unsubordinated unsecured basis by the Company and Level 3 Communications, LLC.

7% Convertible Senior Notes due 2015

During the first quarter of 2015, holders converted the remaining $333 million aggregate principal amount of the Level 3's 7% Convertible Senior Notes due 2015 to common equity. Upon conversion, the Company issued an aggregate of approximately 12 million shares of Level 3 common stock, representing the approximately 37 shares per $1,000 note into which the notes were then convertible.


5.125% Senior Notes due 2023 and 5.375% Senior Notes due 2025

In April 2015, Level 3 Financing issued $700 million in aggregate principal amount of its 5.125% Senior Notes due 2023 (the “5.125% Senior Notes”) and $800 million in aggregate principal amount of its 5.375% Senior Notes due 2025 (the “5.375% Senior Notes”). The net proceeds from the offering of the 5.125% Senior Notes and 5.375% Senior Notes, together with cash on hand, were used to redeem all $1.2 billion aggregate principal amount of Level 3 Financing’s 8.125% Senior Notes due 2019 and all $300 million aggregate principal amount of the Company's 8.875% Senior Notes due 2019, including accrued interest, applicable premiums and expenses. Total loss on extinguishment of debt related to the 8.125% Senior Notes due 2019 was $82 million and total loss on extinguishment of debt related to the 8.875% Senior Notes due 2019 was $18 million.

The 5.125% Senior Notes will mature on May 1, 2023. Interest on the 5.125% Senior Notes is payable on March 1 and September 1 of each year, beginning on September 1, 2015. The 5.375% Senior Notes will mature on May 1, 2025. Interest on the 5.375% Senior Notes is payable on March 1 and September 1 of each year, beginning on September 1, 2015.

Debt issuance costs of approximately $25 million were capitalized and are being amortized over the respective term of the notes.

The 5.125% Senior Notes are subject to redemption at the option of Level 3 Financing, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days’ prior notice, (i) prior to May 1, 2018, at 100% of the principal amount of 5.125% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and (ii) on and after May 1, 2018, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, if redeemed during the twelve months beginning May 1, of the years indicated below:

Year
Redemption Price
2018
102.5625
%
2019
101.2813
%
2020 and thereafter
100.0000
%

At any time or from time to time on or prior to May 1, 2018, the Company may redeem up to 40% of the original aggregate principal amount of the 5.125% Senior Notes at a redemption price equal to 105.125% of the principal amount of the 5.125% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to Level 3 Financing of one or more private placements to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 60% of the original aggregate principal amount of the 5.125% Senior Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days following such private placement or public offering upon not less than 30 nor more than 60 days’ prior notice.

The 5.375% Senior Notes are subject to redemption at the option of Level 3 Financing, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days’ prior notice, (i) prior to May 1, 2020, at 100% of the principal amount of 5.375% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and (ii) on and after May 1, 2020, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, if redeemed during the twelve months beginning May 1, of the years indicated below:

Year
Redemption Price
2020
102.6875
%
2021
101.7917
%
2022
101.8958
%
2023 and thereafter
100.0000
%

At any time or from time to time on or prior to May 1, 2018, the Company may redeem up to 40% of the original aggregate principal amount of the 5.375% Senior Notes at a redemption price equal to 105.375% of the principal amount of the 5.375% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to Level 3 Financing of one or more private placements to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 60% of the original aggregate principal amount of the 5.375% Senior Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days following such private placement or public offering upon not less than 30 nor more than 60 days’ prior notice.

The notes are fully and unconditionally guaranteed on an unsubordinated unsecured basis by the Company and Level 3 Communications, LLC.

Senior Secured Tranche B-II Term Loan due 2022

On May 8, 2015, Level 3 Financing, Inc. refinanced its existing $2 billion senior secured Tranche B Term Loan under its existing senior credit facility through the creation of a new senior secured Tranche B-II 2022 term loan in the aggregate principal amount of $2 billion (the "Tranche B-II 2022 Term Loan"). The Tranche B-II 2022 Term Loan was borrowed pursuant to an amended and restated credit agreement. The Tranche B-II 2022 Term Loan has an interest rate of LIBOR plus 2.75%, with a minimum LIBOR of 0.75%, and will mature on May 31, 2022. The Tranche B-II 2022 Term Loan was priced to lenders at par, with the payment to the lenders of an upfront fee of 25 basis points at closing.

The $2 billion Tranche B 2022 Term Loan had an interest rate of LIBOR plus 3.50%, with a minimum LIBOR of 1.00%, and matured on January 31, 2022. The Company expensed debt issuance costs of approximately $20 million for the portion of the transaction considered to be an extinguishment.

Debt issuance costs related to the Tranche B 2022 Term Loan of approximately $16 million continue to be amortized as interest expense using the new effective interest rate over its term for the portion of the transaction considered to be a modification.

Total loss on modification and extinguishment of debt related to the Tranche B 2022 Term Loan was $27 million.


Long-Term Debt Maturities

Aggregate future contractual maturities of long-term debt and capital leases (excluding discounts) were as follows as of September 30, 2015 (dollars in millions):

2015 (remaining three months)
$
10

2016
8

2017
7

2018
307

2019
822

2020
3,479

Thereafter
6,397

 
$
11,030

Accumulated Other Comprehensive Income (Loss) (Notes)
Comprehensive Income (Loss) Note [Text Block]
Accumulated Other Comprehensive Income (Loss)

The accumulated balances for each classification of other comprehensive income (loss) were as follows:

(dollars in millions)
 
Net Foreign Currency Translation Adjustment
 
Defined Benefit Pension Plans
 
Total
Balance at December 31, 2013
 
$
67

 
$
(31
)
 
$
36

Other comprehensive loss before reclassifications
 
(120
)
 
(2
)
 
(122
)
Amounts reclassified from accumulated other comprehensive income (loss)
 
—

 
4

 
4

Balance at September 30, 2014
 
$
(53
)
 
$
(29
)
 
$
(82
)

Balance at December 31, 2014
 
$
(111
)
 
$
(36
)
 
$
(147
)
Other comprehensive loss before reclassifications
 
(130
)
 
—

 
(130
)
Amounts reclassified from accumulated other comprehensive income (loss)
 
—

 
2

 
2

Balance at September 30, 2015
 
$
(241
)

$
(34
)

$
(275
)
Stock-Based Compensation (Notes)
Stock-Based Compensation
Stock-Based Compensation
The following table summarizes non-cash compensation expense attributable to stock awards for the three and nine months ended September 30, 2015 and 2014 (dollars in millions):
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2015
 
2014
 
2015
 
2014
Outperform Stock Options
$
1

 
$
2

 
$
4

 
$
6

Restricted Stock Units
15

 
10

 
37

 
22

Performance Restricted Stock Units
10

 
4

 
23

 
7

401(k) Match Expense
8

 
6

 
29

 
18

Restricted Stock Unit Bonus Grant
—

 
—

 
—

 
(5
)
 
34

 
22

 
93

 
48

Capitalized Non-Cash Compensation
—

 
—

 
(1
)
 
—

 
$
34

 
$
22

 
$
92

 
$
48



The Company capitalizes non-cash compensation for those employees directly involved in the construction of the network, installation of services for customers or the development of business support systems.

As of September 30, 2015, there were approximately 1 million OSOs outstanding. As of September 30, 2015, there were approximately 4 million restricted stock units and performance restricted stock units outstanding. The Company's Management Incentive and Retention Plan was completed in the first quarter 2014.
Segment Information (Notes)
Segment Reporting Disclosure [Text Block]
Segment Information

Operating segments are defined under GAAP as components of an enterprise for which separate financial information is available and evaluated regularly by the Company's chief operating decision maker ("CODM") in deciding how to allocate resources and assess performance. As a result of the integration of tw telecom (see Note 2 - Events Associated with the Merger of tw telecom), the Company reorganized its management reporting structure to reflect the way in which it allocates resources and assesses performance. Effective the first quarter of 2015, tw telecom has been integrated into North America. As a result of the change, the Company's reportable segments now consist of 1) North America, 2) Europe, the Middle East and Africa (EMEA) and 3) Latin America. Other separate business interests that are not segments include interest, certain corporate assets and overhead costs, and certain other general and administrative costs that are not allocated to any of the operating segments.

The CODM measures and evaluates segment performance primarily based upon revenue, revenue growth and Adjusted EBITDA. Adjusted EBITDA, as defined by the Company, is equal to net income (loss) from the Consolidated Statements of Income before (1) income tax benefit (expense), (2) total other income (expense), (3) non-cash impairment charges included within selling, general and administrative expenses and network related expenses, (4) depreciation and amortization expense, and (5) non-cash stock-based compensation expense included within selling, general and administrative expenses and network related expenses.

Adjusted EBITDA is not a measurement under GAAP and may not be used in the same way by other companies. Management believes that Adjusted EBITDA is an important part of the Company's internal reporting and is a key measure used by management to evaluate profitability and operating performance of the Company and to make resource allocation decisions. Management believes such measurement is especially important in a capital-intensive industry such as telecommunications. Management also uses Adjusted EBITDA to compare the Company's performance to that of its competitors and to eliminate certain non-cash and non-operating items in order to consistently measure from period to period its ability to fund capital expenditures, fund growth, service debt and determine bonuses.

Adjusted EBITDA excludes non-cash impairment charges and non-cash stock-based compensation expense because of the non-cash nature of these items. Adjusted EBITDA also excludes interest income, interest expense and income tax benefit (expense) because these items are associated with the Company's capitalization and tax structures. Adjusted EBITDA also excludes depreciation and amortization expense because these non-cash expenses reflect the effect of capital investments which management believes are better evaluated through cash flow measures. Adjusted EBITDA excludes net other income (expense) because these items are not related to the primary operations of the Company.

There are limitations to using non-GAAP financial measures such as Adjusted EBITDA, including the difficulty associated with comparing companies that use similar performance measures whose calculations may differ from the Company's calculations. Additionally, this financial measure does not include certain significant items such as interest income, interest expense, income tax benefit (expense), depreciation and amortization expense, non-cash impairment charges, non-cash stock-based compensation expense, and net other income (expense). Adjusted EBITDA should not be considered a substitute for other measures of financial performance reported in accordance with GAAP.

The following table presents revenue by segment:
 
 
Three Months Ended
 
Nine Months Ended
(dollars in millions)
 
September 30, 2015
 
September 30, 2014
 
September 30, 2015
 
September 30, 2014
Core Network Services Revenue:
 
 
 
 
 
 
 
 
North America
 
$
1,551

 
$
1,063

 
$
4,637

 
$
3,157

EMEA
 
212

 
219

 
623

 
673

Latin America
 
183

 
200

 
554

 
588

Total Core Network Services Revenue
 
1,946

 
1,482

 
5,814

 
4,418

 
 
 
 
 
 
 
 
 
Wholesale Voice Services and Other Revenue:
 
 
 
 
 
 
 
 
North America
 
110

 
128

 
343

 
410

EMEA
 
3

 
4

 
10

 
14

Latin America
 
3

 
15

 
9

 
21

Total Wholesale Voice Services and Other Revenue
 
116

 
147

 
362

 
445

 
 
 
 
 
 
 
 
 
Total Consolidated Revenue
 
$
2,062

 
$
1,629

 
$
6,176

 
$
4,863



The following table presents Adjusted EBITDA by segment and reconciles Adjusted EBITDA to consolidated net income:
 
 
Three Months Ended
 
Nine Months Ended
(dollars in millions)
 
September 30, 2015
 
September 30, 2014
 
September 30, 2015
 
September 30, 2014
Adjusted EBITDA:
 
 
 
 
 
 
 
 
North America
 
$
760

 
$
492

 
$
2,267

 
$
1,460

EMEA
 
63

 
57

 
176

 
167

Latin America
 
78

 
92

 
237

 
264

Unallocated Corporate Expenses
 
(244
)
 
(170
)
 
(723
)
 
(503
)
Consolidated Adjusted EBITDA
 
657

 
471

 
1,957

 
1,388

Income Tax Expense
 
(16
)
 
(8
)
 
(39
)
 
(27
)
Total Other Expense
 
(310
)
 
(169
)
 
(844
)
 
(507
)
Depreciation and Amortization
 
(296
)
 
(187
)
 
(872
)
 
(558
)
Non-Cash Stock Compensation Attributable to Stock Awards
 
(34
)
 
(22
)
 
(92
)
 
(48
)
Total Consolidated Net Income
 
$
1

 
$
85

 
$
110

 
$
248



The following table presents capital expenditures by segment and reconciles capital expenditures to consolidated capital expenditures:
 
 
Three Months Ended
 
Nine Months Ended
(dollars in millions)
 
September 30, 2015
 
September 30, 2014
 
September 30, 2015
 
September 30, 2014
Capital Expenditures:
 
 
 
 
 
 
 
 
North America
 
$
202

 
$
116

 
$
560

 
$
318

EMEA
 
41

 
34

 
114

 
82

Latin America
 
48

 
35

 
122

 
106

Unallocated Corporate Capital Expenditures
 
37

 
19

 
103

 
102

Consolidated Capital Expenditures
 
$
328

 
$
204

 
$
899

 
$
608



The following table presents total consolidated assets by segment:
(dollars in millions)
 
September 30, 2015
 
December 31, 2014
Assets:
 
 
 
 
North America
 
$
16,615

 
$
16,242

EMEA
 
1,859

 
1,970

Latin America
 
2,147

 
2,451

Other
 
262

 
284

Total Consolidated Assets
 
$
20,883

 
$
20,947

Commitments, Contingencies and Other Items (Notes)
Commitments, Contingencies and Other Items
Commitments, Contingencies and Other Items

The Company is subject to various legal proceedings and other contingent liabilities that individually or in the aggregate could materially affect its financial condition, future results of operations or cash flows. Amounts accrued for such contingencies aggregate to $136 million and are included in “Other” current liabilities and “Other Liabilities” in the Company's Consolidated Balance Sheet at September 30, 2015. 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 would have no effect on the Company's results of operations but could materially adversely affect its cash flows for the affected period.

The Company reviews its accruals at least quarterly and adjusts them to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular matter. Below is a description of material legal proceedings and other contingencies pending at September 30, 2015. Although the Company believes it has accrued for these matters in accordance with the accounting guidance for contingencies, contingencies are inherently unpredictable and it is possible that results of operations or cash flows could be materially and adversely affected in any particular period by unfavorable developments in, or resolution or disposition of, one or more of these matters. For those contingencies in respect of which the Company believes that it is reasonably possible that a loss may result that is materially in excess of the accrual (if any) established for the matter, the Company has either provided an estimate of such possible loss or range of loss or included a statement that such an estimate cannot be made. In addition to the contingencies described below, the Company is party to many other legal proceedings and contingencies, the resolution of which is not expected to materially affect its financial condition or future results of operations beyond the amounts accrued.

Rights-of-Way Litigation

The Company is party to a number of purported class action lawsuits involving its right to install fiber optic cable network in railroad right-of-ways adjacent to plaintiffs' land. In general, the Company obtained the rights to construct its networks from railroads, utilities, and others, and has installed its networks along the rights-of-way so granted. Plaintiffs in the purported class actions assert that they are the owners of lands over which the fiber optic cable networks pass, and that the railroads, utilities and others who granted the Company the right to construct and maintain its network did not have the legal authority to do so. The complaints seek damages on theories of trespass, unjust enrichment and slander of title and property, as well as punitive damages. The Company has also received, and may in the future receive, claims and demands related to rights-of-way issues similar to the issues in these cases that may be based on similar or different legal theories. The Company has defeated motions for class certification in a number of these actions but expects that, absent settlement of these actions, plaintiffs in the pending lawsuits will continue to seek certification of statewide or multi-state classes. The only lawsuit in which a class was certified against the Company, absent an agreed upon settlement, occurred in Koyle, et. al. v. Level 3 Communications, Inc., et. al., a purported two state class action filed in the United States District Court for the District of Idaho. The Koyle lawsuit has been dismissed pursuant to a settlement reached in November 2010 as described further below.

The Company negotiated a series of class settlements affecting all persons who own or owned land next to or near railroad rights of way in which it has installed its fiber optic cable networks. The United States District Court for the District of Massachusetts in Kingsborough v. Sprint Communications Co. L.P. granted preliminary approval of the proposed settlement; however, on September 10, 2009, the court denied a motion for final approval of the settlement on the basis that the court lacked subject matter jurisdiction and dismissed the case.

In November 2010, the Company negotiated revised settlement terms for a series of state class settlements affecting all persons who own or owned land next to or near railroad rights of way in which the Company has installed its fiber optic cable networks. The Company is currently pursuing presentment of the settlement in applicable jurisdictions. The settlements, affecting current and former landowners, have received final federal court approval in multiple states and the parties are engaged in the claims process for those states, including payments of claims. The settlement has also been presented to federal courts in additional states and approval is pending.

Management believes that the Company has substantial defenses to the claims asserted in all of these actions and intends to defend them vigorously if a satisfactory settlement is not ultimately approved for all affected landowners.

Peruvian Tax Litigation

Beginning in 2005, one of the Company's Peruvian subsidiaries received a number of assessments for tax, penalties and interest for calendar years 2001 and 2002. Peruvian tax authorities ("SUNAT") took the position that the Peruvian subsidiary incorrectly documented its importations resulting in additional income tax withholding and value-added taxes ("VAT"). The total amount of the asserted claims, including potential interest and penalties, was $26 million, consisting of $3 million for income tax withholding in connection with the import of services for calendar years 2001 and 2002, $7 million for VAT in connection with the import of services for calendar years 2001 and 2002, and $16 million in connection with the disallowance of VAT credits for periods beginning in 2005. Due to accrued interest and foreign exchange effects, and taking into account the developments described below, the total amount of exposure is $49 million at September 30, 2015.

The Company challenged the tax assessments during 2005 by filing administrative claims before SUNAT. During August 2006 and June 2007, SUNAT rejected the Company's administrative claims, thereby confirming the assessments. Appeals were filed in September 2006 and July 2007 with the Tribunal Fiscal, the highest level of administrative review, which is not part of the Peru judiciary (the "Tribunal"). The 2001 and 2002 assessed withholding tax assessments were resolved in favor of the Company in separate administrative resolutions; however, the penalties with respect to withholding tax remain at issue in the administrative appeals.

In October 2011, the Tribunal issued its administrative resolution with respect to the calendar year 2002 tax period regarding VAT, associated penalties and penalties associated with withholding taxes, deciding the central issue underlying the assessments in the government's favor, while confirming the assessment in part and denying a portion of the assessment on procedural grounds. The Company appealed the Tribunal's October 2011 administrative resolutions to the judicial court in Peru. In September 2014, the first judicial court rendered a decision largely in the Company’s favor on the central issue underlying the assessments. SUNAT appealed the court’s decision to the next judicial level. The court of appeal remanded the case to the first judicial court for further development of the facts and legal analysis supporting its decision.

In October 2013, the Tribunal notified the Company of its July 2013 administrative resolution with respect to the calendar year 2001 tax period regarding VAT, associated penalties and penalties associated with withholding taxes, determining the central issue underlying the assessments in the government's favor, while confirming the assessment in part and denying a portion of the assessment on procedural grounds. The Company appealed the Tribunal's July 2013 administrative resolutions to the judicial court in Peru. In April 2015, the first judicial court rendered a decision largely in SUNAT’s favor on the central issue underlying the assessments. The Company has appealed the court’s decision to the next judicial level.

In December 2013, SUNAT initiated an audit of calendar year 2001. In June 2014, the Company was served with SUNAT’s assessments of the 2001 VAT credits declared null by the Tribunal and the corresponding fine. In July 2014, the Company challenged these assessments by filing administrative claims before SUNAT. In January 2015, SUNAT rejected the administrative claims, thereby confirming the assessments. The Company filed an appeal with the Tribunal in February 2015. In May 2015, the Tribunal notified the Company of its administrative resolution declaring the assessments and corresponding fines null. The time for SUNAT to appeal this resolution has closed. While the Company is not yet aware of any appeal filed by SUNAT, under local practice, notification of an appeal can take several months. Nevertheless, SUNAT retains the right to reissue the assessments declared null or start a new audit.

Employee Severance and Contractor Termination Disputes

A number of former employees and third-party contractors have asserted a variety of claims in litigation against certain Latin American subsidiaries of the Company for separation pay, severance, commissions, pension benefits, unpaid vacation pay, breach of employment contracts, unpaid performance bonuses, property damages, moral damages and related statutory penalties, fines, costs and expenses (including accrued interest, attorneys fees and statutorily mandated inflation adjustments) as a result of their separation from the Company or termination of service relationships. The Company is vigorously defending itself against the asserted claims, which aggregate to approximately $44 million at September 30, 2015.

Brazilian Tax Claims

In December 2004, March 2009, April 2009 and July 2014, the São Paulo state tax authorities issued tax assessments against one of the Company's Brazilian subsidiaries for the Tax on Distribution of Goods and Services (“ICMS”) with respect to revenue from leasing movable properties (in the case of the December 2004, March 2009 and July 2014 assessments) and revenue from the provision of Internet access services (in the case of the April 2009 and July 2014 assessments), by treating such activities as the provision of communications services, to which the ICMS tax applies. During the third quarter of 2014, the Company released a reserve of $6 million for tax, penalty and associated interest corresponding to the ICMS applicable on the provision of Internet access services due to the expiration of the statute of limitations for the January 2008 to June 2009 tax periods. In September 2002, July 2009 and May 2012, the Rio de Janeiro state tax authorities issued tax assessments to the same Brazilian subsidiary on similar issues. The Company has filed objections to these assessments, arguing that the lease of assets and the provision of Internet access are not communication services subject to ICMS. The objections to the September 2002, December 2004 and March 2009 assessments were rejected by the respective state administrative courts, and the Company has appealed those decisions to the judicial courts. In October 2012 and June 2014, the Company received favorable rulings from the lower court on the December 2004 and March 2009 assessments regarding equipment leasing, but those rulings are subject to appeal by the state. No ruling has been obtained with respect to the September 2002 assessment. The objections to the April and July 2009 and May 2012 assessments are still pending final administrative decisions. The July 2014 assessment was confirmed during the fourth quarter of 2014 at the first administrative level and the Company appealed this decision to the second administrative level. During the fourth quarter of 2014, the Company entered into an amnesty with the Rio de Janeiro state tax authorities with respect to potential ICMS liability for the 2008 tax period. As a result, the Company paid $5 million and released a reserve of $3 million of tax corresponding to the ICMS applicable on the provision of Internet access services.

The Company is vigorously contesting all such assessments in both states, and in particular, views the assessment of ICMS on revenue from leasing movable properties to be without merit. Nevertheless, the Company believes that it is reasonably possible that these assessments could result in a loss of up to $39 million at September 30, 2015 in excess of the accruals established for these matters.

Letters of Credit

It is customary for Level 3 to use various financial instruments in the normal course of business. These instruments include letters of credit. Letters of credit are conditional commitments issued on behalf of Level 3 in accordance with specified terms and conditions. As of September 30, 2015 and December 31, 2014, Level 3 had outstanding letters of credit or other similar obligations of approximately $46 million and $28 million, respectively, of which $43 million and $23 million are collateralized by cash that is reflected on the Consolidated Balance Sheets as restricted cash and securities. The Company does not believe exposure to loss related to its letters of credit is material.
Condensed Consolidating Financial Information (Notes)
Condensed Consolidating Financial Information
Condensed Consolidating Financial Information

Level 3 Financing, Inc., a wholly owned subsidiary of the Company, has issued senior notes that are unsecured obligations of Level 3 Financing, Inc.; however, they are also fully and unconditionally and jointly and severally guaranteed on an unsecured senior basis by Level 3 Communications, Inc. and Level 3 Communications, LLC.

In conjunction with the registration of the senior notes, the accompanying condensed consolidating financial information has been prepared and presented pursuant to SEC Regulation S-X Rule 3-10 “Financial statements of guarantors and affiliates whose securities collateralize an issue registered or being registered.”

The operating activities of the separate legal entities included in the Company’s Consolidated Financial Statements are interdependent. The accompanying condensed consolidating financial information presents the results of operations, financial position and cash flows of each legal entity and, on an aggregate basis, the other non-guarantor subsidiaries based on amounts incurred by such entities, and is not intended to present the operating results of those legal entities on a stand-alone basis. Level 3 Communications, LLC leases equipment and certain facilities from other wholly owned subsidiaries of Level 3 Communications, Inc. These transactions are eliminated in the consolidated results of the Company.
Condensed Consolidating Statements of Comprehensive Income (Loss)
Three Months Ended September 30, 2015

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
830

 
$
1,271

 
$
(39
)
 
$
2,062

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
300

 
445

 
(39
)
 
706

Network Related Expenses
—

 
—

 
252

 
117

 
—

 
369

Depreciation and Amortization
—

 
—

 
78

 
218

 
—

 
296

Selling, General and Administrative Expenses
1

 
—

 
274

 
89

 
—

 
364

Total Costs and Expenses
1

 
—

 
904

 
869

 
(39
)
 
1,735

Operating Income (Loss)
(1
)
 
—

 
(74
)
 
402

 
—

 
327

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest expense
(9
)
 
(135
)
 
—

 
(1
)
 
—

 
(145
)
Interest income (expense) affiliates, net
320

 
498

 
(763
)
 
(55
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(309
)
 
(671
)
 
—

 
—

 
980

 
—

Other, net
—

 
—

 
3

 
(168
)
 
—

 
(165
)
Total Other Income (Expense)
2

 
(308
)
 
(760
)
 
(224
)
 
980

 
(310
)
Income (Loss) before Income Taxes
1

 
(308
)
 
(834
)
 
178

 
980

 
17

Income Tax Expense
—

 
(1
)
 
—

 
(15
)
 
—

 
(16
)
Net Income (Loss)
1

 
(309
)
 
(834
)
 
163

 
980

 
1

Other Comprehensive Income (Loss), Net of Income Taxes
(72
)
 
—

 
—

 
72

 
(72
)
 
(72
)
Comprehensive Income (Loss)
$
(71
)
 
$
(309
)
 
$
(834
)
 
$
235

 
$
908

 
$
(71
)
Condensed Consolidating Statements of Comprehensive Income (Loss)
Nine Months Ended September 30, 2015
 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
2,478

 
$
3,834

 
$
(136
)
 
$
6,176

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
919

 
1,342

 
(136
)
 
2,125

Network Related Expenses
—

 
—

 
713

 
375

 
—

 
1,088

Depreciation and Amortization
—

 
—

 
227

 
645

 
—

 
872

Selling, General and Administrative Expenses
3

 
—

 
789

 
306

 
—

 
1,098

Total Costs and Expenses
3

 
—

 
2,648

 
2,668

 
(136
)
 
5,183

Operating Income (Loss)
(3
)
 
—

 
(170
)
 
1,166

 
—

 
993

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest Income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(42
)
 
(436
)
 
(2
)
 
(10
)
 
—

 
(490
)
Interest income (expense) affiliates, net
984

 
1,495

 
(2,298
)
 
(181
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(811
)
 
(1,723
)
 
177

 
—

 
2,357

 
—

Other, net
(18
)
 
(145
)
 
2

 
(194
)
 
—

 
(355
)
Total Other Income (Expense)
113

 
(809
)
 
(2,121
)
 
(384
)
 
2,357

 
(844
)
Income (Loss) before Income Taxes
110

 
(809
)
 
(2,291
)
 
782

 
2,357

 
149

Income Tax Expense
—

 
(2
)
 
—

 
(37
)
 
—

 
(39
)
Net Income (Loss)
110

 
(811
)
 
(2,291
)
 
745

 
2,357

 
110

Other Comprehensive Income (Loss), Net of Income Taxes
(128
)
 
—

 
—

 
128

 
(128
)
 
(128
)
Comprehensive Income (Loss)
$
(18
)
 
$
(811
)
 
$
(2,291
)
 
$
873

 
$
2,229

 
$
(18
)
Condensed Consolidating Statements of Comprehensive Income (Loss)
Three Months Ended September 30, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
781

 
$
901

 
$
(53
)
 
$
1,629

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
291

 
369

 
(53
)
 
607

Network Related Expenses
—

 
—

 
195

 
112

 
—

 
307

Depreciation and Amortization
—

 
—

 
70

 
117

 
—

 
187

Selling, General and Administrative Expenses
6

 
—

 
181

 
79

 
—

 
266

Total Costs and Expenses
6

 
—

 
737

 
677

 
(53
)
 
1,367

Operating Income
(6
)
 
—

 
44

 
224

 
—

 
262

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(34
)
 
(112
)
 
(1
)
 
(12
)
 
—

 
(159
)
Interest income (expense) affiliates, net
314

 
452

 
(730
)
 
(36
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(189
)
 
(528
)
 
162

 
—

 
555

 
—

Other, net
—

 
—

 
2

 
(13
)
 
—

 
(11
)
Total Other Expense
91

 
(188
)
 
(567
)
 
(60
)
 
555

 
(169
)
Income (Loss) before Income Taxes
85

 
(188
)
 
(523
)
 
164

 
555

 
93

Income Tax Expense
—

 
(1
)
 
—

 
(7
)
 
—

 
(8
)
Net Income (Loss)
85

 
(189
)
 
(523
)
 
157

 
555

 
85

Other Comprehensive Income (Loss), Net of Income Taxes
(137
)
 
—

 
—

 
(137
)
 
137

 
(137
)
Comprehensive Income (Loss)
$
(52
)
 
$
(189
)
 
$
(523
)
 
$
20

 
$
692

 
$
(52
)
Condensed Consolidating Statements of Comprehensive Income (Loss)
Nine Months Ended September 30, 2014
 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
2,278

 
$
2,750

 
$
(165
)
 
$
4,863

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
869

 
1,130

 
(165
)
 
1,834

Network Related Expenses
—

 
—

 
567

 
334

 
—

 
901

Depreciation and Amortization
—

 
—

 
209

 
349

 
—

 
558

Selling, General and Administrative Expenses
7

 
1

 
505

 
275

 
—

 
788

Total Costs and Expenses
7

 
1

 
2,150

 
2,088

 
(165
)
 
4,081

Operating Income
(7
)
 
(1
)
 
128

 
662

 
—

 
782

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(102
)
 
(337
)
 
(1
)
 
(19
)
 
—

 
(459
)
Interest income (expense) affiliates, net
905

 
1,370

 
(2,169
)
 
(106
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(548
)
 
(1,577
)
 
502

 
—

 
1,623

 
—

Other, net
—

 
—

 
6

 
(55
)
 
—

 
(49
)
Total Other Expense
255

 
(544
)
 
(1,662
)
 
(179
)
 
1,623

 
(507
)
Income (Loss) before Income Taxes
248

 
(545
)
 
(1,534
)
 
483

 
1,623

 
275

Income Tax Expense
—

 
(3
)
 
(1
)
 
(23
)
 
—

 
(27
)
Net Income (Loss)
248

 
(548
)
 
(1,535
)
 
460

 
1,623

 
248

Other Comprehensive Income (Loss), Net of Income Taxes
(118
)
 
—

 
—

 
(118
)
 
118

 
(118
)
Comprehensive Income (Loss)
$
130

 
$
(548
)
 
$
(1,535
)
 
$
342

 
$
1,741

 
$
130

Condensed Consolidating Balance Sheets
September 30, 2015

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
13

 
$
6

 
$
559

 
$
113

 
$
—

 
$
691

Restricted cash and securities
—

 
—

 
1

 
6

 
—

 
7

Receivables, less allowances for doubtful accounts
—

 
—

 
68

 
742

 
—

 
810

Due from affiliates
15,304

 
22,482

 
—

 
—

 
(37,786
)
 
—

Other
1

 
19

 
67

 
68

 
—

 
155

Total Current Assets
15,318

 
22,507

 
695

 
929

 
(37,786
)
 
1,663

Property, Plant, and Equipment, net
—

 
—

 
3,320

 
6,492

 
—

 
9,812

Restricted Cash and Securities
27

 
—

 
15

 
2

 
—

 
44

Goodwill and Other Intangibles, net
—

 
—

 
365

 
8,570

 
—

 
8,935

Investment in Subsidiaries
16,737

 
14,542

 
3,737

 
—

 
(35,016
)
 
—

Other Assets, net
20

 
119

 
11

 
279

 
—

 
429

Total Assets
$
32,102

 
$
37,168

 
$
8,143

 
$
16,272

 
$
(72,802
)
 
$
20,883

 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity (Deficit)
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
1

 
$
194

 
$
435

 
$
—

 
$
630

Current portion of long-term debt
—

 
—

 
3

 
13

 
—

 
16

Accrued payroll and employee benefits
—

 
—

 
198

 
32

 
—

 
230

Accrued interest
3

 
128

 
—

 
6

 
—

 
137

Current portion of deferred revenue
—

 
—

 
113

 
160

 
—

 
273

Due to affiliates
—

 
—

 
36,981

 
805

 
(37,786
)
 
—

Other
—

 
—

 
94

 
90

 
—

 
184

Total Current Liabilities
3

 
129

 
37,583

 
1,541

 
(37,786
)
 
1,470

Long-Term Debt, less current portion
600

 
10,209

 
15

 
173

 
—

 
10,997

Deferred Revenue, less current portion
—

 
—

 
648

 
294

 
—

 
942

Other Liabilities
15

 
27

 
132

 
520

 
—

 
694

Commitments and Contingencies

 

 

 

 

 

Stockholders' Equity (Deficit)
31,484

 
26,803

 
(30,235
)
 
13,744

 
(35,016
)
 
6,780

Total Liabilities and Stockholders' Equity (Deficit)
$
32,102

 
$
37,168

 
$
8,143

 
$
16,272

 
$
(72,802
)
 
$
20,883

Condensed Consolidating Balance Sheets
December 31, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
7

 
$
5

 
$
307

 
$
261

 
$
—

 
$
580

Restricted cash and securities
—

 
—

 
1

 
6

 
—

 
7

Receivables, less allowances for doubtful accounts
—

 
—

 
34

 
703

 
—

 
737

Due from affiliates
14,522

 
21,270

 
—

 
—

 
(35,792
)
 
—

Other
2

 
21

 
45

 
97

 
—

 
165

Total Current Assets
14,531

 
21,296

 
387

 
1,067

 
(35,792
)
 
1,489

Property, Plant, and Equipment, net
—

 
—

 
3,152

 
6,708

 
—

 
9,860

Restricted Cash and Securities
3

 
—

 
16

 
1

 
—

 
20

Goodwill and Other Intangibles, net
—

 
—

 
373

 
8,730

 
—

 
9,103

Investment in Subsidiaries
16,686

 
14,777

 
3,729

 
—

 
(35,192
)
 
—

Other Assets, net
28

 
129

 
9

 
309

 
—

 
475

Total Assets
$
31,248

 
$
36,202

 
$
7,666

 
$
16,815

 
$
(70,984
)
 
$
20,947

 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity (Deficit)
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
—

 
$
215

 
$
449

 
$
—

 
$
664

Current portion of long-term debt
333

 
—

 
3

 
13

 
—

 
349

Accrued payroll and employee benefits
—

 
—

 
174

 
99

 
—

 
273

Accrued interest
12

 
158

 
—

 
4

 
—

 
174

Current portion of deferred revenue
—

 
—

 
118

 
169

 
—

 
287

Due to affiliates
—

 
—

 
34,401

 
1,391

 
(35,792
)
 
—

Other
—

 
2

 
62

 
103

 
—

 
167

Total Current Liabilities
345

 
160

 
34,973

 
2,228

 
(35,792
)
 
1,914

Long-Term Debt, less current portion
900

 
9,893

 
16

 
175

 
—

 
10,984

Deferred Revenue, less current portion
—

 
—

 
617

 
304

 
—

 
921

Other Liabilities
16

 
24

 
125

 
600

 
—

 
765

Commitments and Contingencies

 

 

 

 

 

Stockholders' Equity (Deficit)
29,987

 
26,125

 
(28,065
)
 
13,508

 
(35,192
)
 
6,363

Total Liabilities and Stockholders' Equity (Deficit)
$
31,248

 
$
36,202

 
$
7,666

 
$
16,815

 
$
(70,984
)
 
$
20,947

Condensed Consolidating Statements of Cash Flows
Nine Months Ended September 30, 2015

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities
$
(39
)
 
$
(447
)
 
$
57

 
$
1,728

 
$
—

 
$
1,299

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital Expenditures
—

 
—

 
(307
)
 
(592
)
 
—

 
(899
)
Cash related to deconsolidated Venezuela operations
—

 
—

 
—

 
(83
)
 
 
 
(83
)
(Increase) decrease in restricted cash and securities, net
(25
)
 
—

 
1

 
—

 
—

 
(24
)
Proceeds from the sale of property, plant and equipment and other assets
—

 
—

 
—

 
3

 
—

 
3

Other
—

 
—

 
(14
)
 
—

 
—

 
(14
)
Net Cash Used in Investing Activities
(25
)
 
—

 
(320
)
 
(672
)
 
—

 
(1,017
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
—

 
3,947

 
—

 
—

 
—

 
3,947

Payments on and repurchases of long-term debt, including current portion and refinancing costs
(313
)
 
(3,780
)
 
(1
)
 
(8
)
 
—

 
(4,102
)
Increase (decrease) due from/to affiliates, net
383

 
281

 
516

 
(1,180
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities
70

 
448

 
515

 
(1,188
)
 
—

 
(155
)
Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
(16
)
 
—

 
(16
)
Net Change in Cash and Cash Equivalents
6

 
1

 
252

 
(148
)
 
—

 
111

Cash and Cash Equivalents at Beginning of Period
7

 
5

 
307

 
261

 
—

 
580

Cash and Cash Equivalents at End of Period
$
13

 
$
6

 
$
559

 
$
113

 
$
—

 
$
691

Condensed Consolidating Statements of Cash Flows
Nine Months Ended September 30, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities
$
(91
)
 
$
(336
)
 
$
443

 
$
749

 
$
—

 
$
765

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital Expenditures
—

 
—

 
(261
)
 
(347
)
 
—

 
(608
)
Decrease in restricted cash and securities, net
—

 
—

 
1

 
(11
)
 
—

 
(10
)
Proceeds from sale of property, plant and equipment and other assets
—

 
—

 
—

 
3

 
—

 
3

Other
—

 
—

 
—

 
(2
)
 
—

 
(2
)
Net Cash Used in Investing Activities
—

 
—

 
(260
)
 
(357
)
 
—

 
(617
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
—

 
—

 
—

 
(1
)
 
—

 
(1
)
Payments on and repurchases of long-term debt, including current portion and refinancing costs
—

 
—

 
—

 
(8
)
 
—

 
(8
)
Increase (decrease) due from/to affiliates, net
90

 
335

 
(6
)
 
(419
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities
90

 
335

 
(6
)
 
(428
)
 
—

 
(9
)
Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
(41
)
 
—

 
(41
)
Net Change in Cash and Cash Equivalents
(1
)
 
(1
)
 
177

 
(77
)
 
—

 
98

Cash and Cash Equivalents at Beginning of Period
8

 
6

 
347

 
270

 
—

 
631

Cash and Cash Equivalents at End of Period
$
7

 
$
5

 
$
524

 
$
193

 
$
—

 
$
729

Subsequent Events (Notes)
Subsequent Events [Text Block]
Subsequent Events


On October 29, 2015, Level 3 Financing  agreed to sell $900 million aggregate principal amount of 5.375% Senior Notes due 2024 (the "5.375% Senior Notes") in a private offering. The offering is expected to be completed on November 13, 2015, subject to the satisfaction or waiver of customary closing conditions. The 5.375% Senior Notes were priced at par and mature on January 15, 2024. The 5.375% Senior Notes will pay interest on January 15 and July 15 of each year beginning on January 15, 2016.
 
The net proceeds from the offering of the 5.375% Senior Notes due 2024, together with cash on hand, will be used to redeem all $900 million aggregate principal amount of Level 3 Financing, Inc.’s 8.625% Senior Notes due 2020. In the fourth quarter 2015, the Company expects to recognize a loss on modification and extinguishment of debt of approximately $55 million as a result of this transaction that will be recognized in Other Expense.
Organization and Summary of Significant Accounting Policies (Policies)
Principles of Consolidation and Basis of Presentation
Principles of Consolidation and Basis of Presentation

The Consolidated Financial Statements include the accounts of Level 3 Communications, Inc. and subsidiaries in which it has a controlling interest. All significant intercompany accounts and transactions have been eliminated. The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP").

As part of its consolidation policy, the Company considers its controlled subsidiaries, investments in businesses in which the Company is not the primary beneficiary or does not have effective control but has the ability to significantly influence operating and financial policies, and variable interests resulting from economic arrangements that give the Company rights to economic risks or rewards of a legal entity. The Company does not have variable interests in a variable interest entity where it is required to consolidate the entity as the primary beneficiary or where it has concluded it is not the primary beneficiary.
    
Prior to October 1, 2015, the Company included the results of its wholly owned Venezuelan subsidiary in its Consolidated Financial Statements using the consolidation method of accounting. The Company’s Venezuelan subsidiary's earnings and cash flows are reflected in the Consolidated Financial Statements at the SICAD I exchange rate for the three and nine months ended September 30, 2015 and 2014, respectively. The consolidated results of operations include a $5 million charge related to the devaluation of the SICAD I exchange rate from 12.8 bolivars per U.S. dollar to 13.5 bolivars per U.S. dollar, which was effective September 1, 2015.
Venezuelan exchange control regulations have resulted in an other-than-temporary lack of exchangeability between the Venezuelan bolivar and U.S. dollar, and have restricted the Company's Venezuelan operations’ ability to pay dividends in U.S. dollars and settle intercompany obligations in U.S. dollars. The severe currency controls imposed by the Venezuelan government have significantly limited the ability to realize the benefits from earnings of the Company’s Venezuelan operations and access the resulting liquidity provided by those earnings in U.S. dollars. The Company expects that this condition will continue for the foreseeable future. Additionally, government regulations affecting the Company's ability to manage its Venezuelan subsidiary’s capital structure, purchasing, product pricing, customer invoicing and collections, and labor relations; and the current political and economic situation within Venezuela have resulted in an acute degradation in the Company's ability to make key operational decisions for its Venezuelan operations. This lack of exchangeability into U.S. dollars and the degradation in the Company's ability to control key operational decisions has resulted in a lack of control over the Company's Venezuelan subsidiary for U.S. accounting purposes. Therefore, while continuing to wholly own its Venezuelan subsidiary, in accordance with Accounting Standards Codification 810 -- Consolidation, the Company deconsolidated its Venezuelan subsidiary on September 30, 2015, and will begin accounting for its investment in its Venezuelan operations using the cost method of accounting.
As a result of deconsolidating of its Venezuelan subsidiary, the Company recorded a one-time charge of $171 million in the third quarter of 2015, which had no accompanying tax benefit. This charge included the write-off of both the Company's investment in its Venezuelan subsidiary and $40 million of intercompany receivables from its Venezuelan subsidiary. The Company's Venezuelan operations’ bolivar-denominated cash balance of $83 million (at the SICAD I exchange rate of 13.5 bolivars per U.S. dollar) at September 30, 2015 is no longer reported in Cash and Cash Equivalents on the Consolidated Balance Sheet. In future periods, the Company's financial results will not include the operating results of its Venezuelan operations. Any dividends from the Company's Venezuelan subsidiaries will be recorded as other income upon receipt of the cash. Prior period results have not been adjusted to reflect the deconsolidation of the Company's Venezuelan subsidiary. As a result of the deconsolidation of the Company's Venezuelan subsidiary, the Company completed an assessment of the Latin American reporting unit goodwill as of September 30, 2015 and concluded there was no impairment.
Acquired Intangible Assets (Tables)
Schedule of acquisition-related intangible assets 
Identifiable acquisition-related intangible assets as of September 30, 2015 and December 31, 2014 were as follows (dollars in millions):

 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
September 30, 2015
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Customer Contracts and Relationships
$
1,975

 
$
(884
)
 
$
1,091

Trademarks
55

 
(55
)
 
—

Patents and Developed Technology
230

 
(154
)
 
76

 
2,260

 
(1,093
)
 
1,167

Indefinite-Lived Intangible Assets:
 
 
 
 
 
Trade Name
15

 
—

 
15

 
$
2,275

 
$
(1,093
)
 
$
1,182

December 31, 2014
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Customer Contracts and Relationships
$
1,977

 
$
(741
)
 
$
1,236

Trademarks
115

 
(47
)
 
68

Patents and Developed Technology
228

 
(133
)
 
95

 
2,320

 
(921
)
 
1,399

Indefinite-Lived Intangible Assets:
 
 
 
 
 
Trade Name
15

 
—

 
15

 
$
2,335

 
$
(921
)
 
$
1,414

Schedule of estimated amortization expense of finite-lived acquisition-related intangible assets 
As of September 30, 2015, estimated amortization expense for the Company’s finite-lived acquisition-related intangible assets over the next five years is as follows (dollars in millions):

2015 (remaining three months)
$
54

2016
212

2017
196

2018
193

2019
182

2020
166

Thereafter
164

 
$
1,167

Fair Value of Financial Instruments (Tables)
Schedule of fair value of liabilities measured on a recurring basis
The table below presents the fair values for the Company’s long-term debt as well as the input levels used to determine these fair values as of September 30, 2015 and December 31, 2014:

 
 
 
 
 
 
Fair Value Measurement Using
 
 
Total Carrying Value in Consolidated Balance Sheets
 
Unadjusted Quoted Prices in Active
Markets for Identical Assets or Liabilities (Level 1)
 
Significant Other Observable Inputs (Level 2)
(dollars in millions)
 
September 30,
2015
 
December 31,
2014
 
September 30,
2015
 
December 31,
2014
 
September 30,
2015
 
December 31,
2014
Liabilities Not Recorded at Fair Value in the Financial Statements:
 
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt, including the current portion:
 
 
 
 
 
 
 
 
 
 
 
 
Term Loans
 
$
4,594

 
$
4,590

 
$
4,589

 
$
4,593

 
$
—

 
$
—

Senior Notes
 
6,215

 
6,203

 
6,158

 
6,481

 
—

 
—

Convertible Notes
 
—

 
333

 
—

 
—

 
—

 
868

Capital Leases and Other
 
204

 
207

 
—

 
—

 
204

 
207

Total Long-term Debt, including the current portion
 
$
11,013

 
$
11,333

 
$
10,747

 
$
11,074

 
$
204

 
$
1,075



The Company does not have any assets or liabilities where the fair value is measured using significant unobservable inputs (Level 3).
Long-Term Debt (Tables)
Schedule of long-term debt 
As of September 30, 2015 and December 31, 2014, long-term debt was as follows:
(dollars in millions)
 
September 30,
2015
 
December 31,
2014
Senior Secured Term Loan*
 
$
4,611

 
$
4,611

Floating Rate Senior Notes due 2018 (3.914% as of September 30, 2015 and 3.826% as of December 31, 2014)
 
300

 
300

9.375% Senior Notes due 2019
 
—

 
500

8.125% Senior Notes due 2019
 
—

 
1,200

8.875% Senior Notes due 2019
 
—

 
300

8.625% Senior Notes due 2020
 
900

 
900

7% Senior Notes due 2020
 
775

 
775

6.125% Senior Notes due 2021
 
640

 
640

5.375% Senior Notes due 2022
 
1,000

 
1,000

5.75% Senior Notes due 2022
 
600

 
600

5.625% Senior Notes due 2023
 
500

 
—

5.125% Senior Notes due 2023
 
700

 
—

5.375% Senior Notes due 2025
 
800

 
—

7% Convertible Senior Notes due 2015
 
—

 
58

7% Convertible Senior Notes due 2015 Series B
 
—

 
275

Capital Leases
 
204

 
207

Total Debt Obligations
 
11,030

 
11,366

Unamortized Discount:
 
 
 
 
Discount on Senior Secured Term Loan
 
(17
)
 
(21
)
Discount on 9.375% Senior Notes due 2019
 
—

 
(6
)
Discount on 8.125% Senior Notes due 2019
 
—

 
(6
)
Total Unamortized Discount
 
(17
)
 
(33
)
Carrying Value of Debt
 
11,013

 
11,333

Less current portion
 
(16
)
 
(349
)
Long-term Debt, less current portion
 
$
10,997

 
$
10,984


* The $2 billion Tranche B Term Loan due 2022 had an interest rate of 4.5% as of December 31, 2014 and the $2 billion Tranche B-II Term Loan due 2022, which refinanced the Tranche B Term Loan due 2022 in full, had an interest rate of 3.5% as of September 30, 2015. The $815 million Tranche B-III Term Loan due 2019 and the $1.796 billion Tranche B Term Loan due 2020 each had an interest rate of 4.0% as of September 30, 2015 and December 31, 2014.

Schedule of aggregate future contractual maturities of long-term debt and capital leases (excluding discounts) 
Long-Term Debt Maturities

Aggregate future contractual maturities of long-term debt and capital leases (excluding discounts) were as follows as of September 30, 2015 (dollars in millions):

2015 (remaining three months)
$
10

2016
8

2017
7

2018
307

2019
822

2020
3,479

Thereafter
6,397

 
$
11,030

Accumulated Other Comprehensive Income (Loss) (Tables)
Comprehensive Income (Loss) Note [Text Block] 
Accumulated Other Comprehensive Income (Loss)

The accumulated balances for each classification of other comprehensive income (loss) were as follows:

(dollars in millions)
 
Net Foreign Currency Translation Adjustment
 
Defined Benefit Pension Plans
 
Total
Balance at December 31, 2013
 
$
67

 
$
(31
)
 
$
36

Other comprehensive loss before reclassifications
 
(120
)
 
(2
)
 
(122
)
Amounts reclassified from accumulated other comprehensive income (loss)
 
—

 
4

 
4

Balance at September 30, 2014
 
$
(53
)
 
$
(29
)
 
$
(82
)

Balance at December 31, 2014
 
$
(111
)
 
$
(36
)
 
$
(147
)
Other comprehensive loss before reclassifications
 
(130
)
 
—

 
(130
)
Amounts reclassified from accumulated other comprehensive income (loss)
 
—

 
2

 
2

Balance at September 30, 2015
 
$
(241
)

$
(34
)

$
(275
)
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] 
The accumulated balances for each classification of other comprehensive income (loss) were as follows:

(dollars in millions)
 
Net Foreign Currency Translation Adjustment
 
Defined Benefit Pension Plans
 
Total
Balance at December 31, 2013
 
$
67

 
$
(31
)
 
$
36

Other comprehensive loss before reclassifications
 
(120
)
 
(2
)
 
(122
)
Amounts reclassified from accumulated other comprehensive income (loss)
 
—

 
4

 
4

Balance at September 30, 2014
 
$
(53
)
 
$
(29
)
 
$
(82
)

Balance at December 31, 2014
 
$
(111
)
 
$
(36
)
 
$
(147
)
Other comprehensive loss before reclassifications
 
(130
)
 
—

 
(130
)
Amounts reclassified from accumulated other comprehensive income (loss)
 
—

 
2

 
2

Balance at September 30, 2015
 
$
(241
)

$
(34
)

$
(275
)
Stock-Based Compensation (Tables)
Schedule of non-cash compensation expense and capitalized non-cash compensation
The following table summarizes non-cash compensation expense attributable to stock awards for the three and nine months ended September 30, 2015 and 2014 (dollars in millions):
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2015
 
2014
 
2015
 
2014
Outperform Stock Options
$
1

 
$
2

 
$
4

 
$
6

Restricted Stock Units
15

 
10

 
37

 
22

Performance Restricted Stock Units
10

 
4

 
23

 
7

401(k) Match Expense
8

 
6

 
29

 
18

Restricted Stock Unit Bonus Grant
—

 
—

 
—

 
(5
)
 
34

 
22

 
93

 
48

Capitalized Non-Cash Compensation
—

 
—

 
(1
)
 
—

 
$
34

 
$
22

 
$
92

 
$
48

Segment Information (Tables)
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Table Text Block] 
The following table presents Adjusted EBITDA by segment and reconciles Adjusted EBITDA to consolidated net income:
 
 
Three Months Ended
 
Nine Months Ended
(dollars in millions)
 
September 30, 2015
 
September 30, 2014
 
September 30, 2015
 
September 30, 2014
Adjusted EBITDA:
 
 
 
 
 
 
 
 
North America
 
$
760

 
$
492

 
$
2,267

 
$
1,460

EMEA
 
63

 
57

 
176

 
167

Latin America
 
78

 
92

 
237

 
264

Unallocated Corporate Expenses
 
(244
)
 
(170
)
 
(723
)
 
(503
)
Consolidated Adjusted EBITDA
 
657

 
471

 
1,957

 
1,388

Income Tax Expense
 
(16
)
 
(8
)
 
(39
)
 
(27
)
Total Other Expense
 
(310
)
 
(169
)
 
(844
)
 
(507
)
Depreciation and Amortization
 
(296
)
 
(187
)
 
(872
)
 
(558
)
Non-Cash Stock Compensation Attributable to Stock Awards
 
(34
)
 
(22
)
 
(92
)
 
(48
)
Total Consolidated Net Income
 
$
1

 
$
85

 
$
110

 
$
248

Schedule of Segment Reporting Information, by Segment [Table Text Block] 
The following table presents capital expenditures by segment and reconciles capital expenditures to consolidated capital expenditures:
 
 
Three Months Ended
 
Nine Months Ended
(dollars in millions)
 
September 30, 2015
 
September 30, 2014
 
September 30, 2015
 
September 30, 2014
Capital Expenditures:
 
 
 
 
 
 
 
 
North America
 
$
202

 
$
116

 
$
560

 
$
318

EMEA
 
41

 
34

 
114

 
82

Latin America
 
48

 
35

 
122

 
106

Unallocated Corporate Capital Expenditures
 
37

 
19

 
103

 
102

Consolidated Capital Expenditures
 
$
328

 
$
204

 
$
899

 
$
608

Segment Reporting Disclosure [Text Block] 
Segment Information

Operating segments are defined under GAAP as components of an enterprise for which separate financial information is available and evaluated regularly by the Company's chief operating decision maker ("CODM") in deciding how to allocate resources and assess performance. As a result of the integration of tw telecom (see Note 2 - Events Associated with the Merger of tw telecom), the Company reorganized its management reporting structure to reflect the way in which it allocates resources and assesses performance. Effective the first quarter of 2015, tw telecom has been integrated into North America. As a result of the change, the Company's reportable segments now consist of 1) North America, 2) Europe, the Middle East and Africa (EMEA) and 3) Latin America. Other separate business interests that are not segments include interest, certain corporate assets and overhead costs, and certain other general and administrative costs that are not allocated to any of the operating segments.

The CODM measures and evaluates segment performance primarily based upon revenue, revenue growth and Adjusted EBITDA. Adjusted EBITDA, as defined by the Company, is equal to net income (loss) from the Consolidated Statements of Income before (1) income tax benefit (expense), (2) total other income (expense), (3) non-cash impairment charges included within selling, general and administrative expenses and network related expenses, (4) depreciation and amortization expense, and (5) non-cash stock-based compensation expense included within selling, general and administrative expenses and network related expenses.

Adjusted EBITDA is not a measurement under GAAP and may not be used in the same way by other companies. Management believes that Adjusted EBITDA is an important part of the Company's internal reporting and is a key measure used by management to evaluate profitability and operating performance of the Company and to make resource allocation decisions. Management believes such measurement is especially important in a capital-intensive industry such as telecommunications. Management also uses Adjusted EBITDA to compare the Company's performance to that of its competitors and to eliminate certain non-cash and non-operating items in order to consistently measure from period to period its ability to fund capital expenditures, fund growth, service debt and determine bonuses.

Adjusted EBITDA excludes non-cash impairment charges and non-cash stock-based compensation expense because of the non-cash nature of these items. Adjusted EBITDA also excludes interest income, interest expense and income tax benefit (expense) because these items are associated with the Company's capitalization and tax structures. Adjusted EBITDA also excludes depreciation and amortization expense because these non-cash expenses reflect the effect of capital investments which management believes are better evaluated through cash flow measures. Adjusted EBITDA excludes net other income (expense) because these items are not related to the primary operations of the Company.

There are limitations to using non-GAAP financial measures such as Adjusted EBITDA, including the difficulty associated with comparing companies that use similar performance measures whose calculations may differ from the Company's calculations. Additionally, this financial measure does not include certain significant items such as interest income, interest expense, income tax benefit (expense), depreciation and amortization expense, non-cash impairment charges, non-cash stock-based compensation expense, and net other income (expense). Adjusted EBITDA should not be considered a substitute for other measures of financial performance reported in accordance with GAAP.

The following table presents revenue by segment:
 
 
Three Months Ended
 
Nine Months Ended
(dollars in millions)
 
September 30, 2015
 
September 30, 2014
 
September 30, 2015
 
September 30, 2014
Core Network Services Revenue:
 
 
 
 
 
 
 
 
North America
 
$
1,551

 
$
1,063

 
$
4,637

 
$
3,157

EMEA
 
212

 
219

 
623

 
673

Latin America
 
183

 
200

 
554

 
588

Total Core Network Services Revenue
 
1,946

 
1,482

 
5,814

 
4,418

 
 
 
 
 
 
 
 
 
Wholesale Voice Services and Other Revenue:
 
 
 
 
 
 
 
 
North America
 
110

 
128

 
343

 
410

EMEA
 
3

 
4

 
10

 
14

Latin America
 
3

 
15

 
9

 
21

Total Wholesale Voice Services and Other Revenue
 
116

 
147

 
362

 
445

 
 
 
 
 
 
 
 
 
Total Consolidated Revenue
 
$
2,062

 
$
1,629

 
$
6,176

 
$
4,863



The following table presents Adjusted EBITDA by segment and reconciles Adjusted EBITDA to consolidated net income:
 
 
Three Months Ended
 
Nine Months Ended
(dollars in millions)
 
September 30, 2015
 
September 30, 2014
 
September 30, 2015
 
September 30, 2014
Adjusted EBITDA:
 
 
 
 
 
 
 
 
North America
 
$
760

 
$
492

 
$
2,267

 
$
1,460

EMEA
 
63

 
57

 
176

 
167

Latin America
 
78

 
92

 
237

 
264

Unallocated Corporate Expenses
 
(244
)
 
(170
)
 
(723
)
 
(503
)
Consolidated Adjusted EBITDA
 
657

 
471

 
1,957

 
1,388

Income Tax Expense
 
(16
)
 
(8
)
 
(39
)
 
(27
)
Total Other Expense
 
(310
)
 
(169
)
 
(844
)
 
(507
)
Depreciation and Amortization
 
(296
)
 
(187
)
 
(872
)
 
(558
)
Non-Cash Stock Compensation Attributable to Stock Awards
 
(34
)
 
(22
)
 
(92
)
 
(48
)
Total Consolidated Net Income
 
$
1

 
$
85

 
$
110

 
$
248



The following table presents capital expenditures by segment and reconciles capital expenditures to consolidated capital expenditures:
 
 
Three Months Ended
 
Nine Months Ended
(dollars in millions)
 
September 30, 2015
 
September 30, 2014
 
September 30, 2015
 
September 30, 2014
Capital Expenditures:
 
 
 
 
 
 
 
 
North America
 
$
202

 
$
116

 
$
560

 
$
318

EMEA
 
41

 
34

 
114

 
82

Latin America
 
48

 
35

 
122

 
106

Unallocated Corporate Capital Expenditures
 
37

 
19

 
103

 
102

Consolidated Capital Expenditures
 
$
328

 
$
204

 
$
899

 
$
608



The following table presents total consolidated assets by segment:
(dollars in millions)
 
September 30, 2015
 
December 31, 2014
Assets:
 
 
 
 
North America
 
$
16,615

 
$
16,242

EMEA
 
1,859

 
1,970

Latin America
 
2,147

 
2,451

Other
 
262

 
284

Total Consolidated Assets
 
$
20,883

 
$
20,947

Reconciliation of Revenue from Segments to Consolidated [Table Text Block] 
The following table presents revenue by segment:
 
 
Three Months Ended
 
Nine Months Ended
(dollars in millions)
 
September 30, 2015
 
September 30, 2014
 
September 30, 2015
 
September 30, 2014
Core Network Services Revenue:
 
 
 
 
 
 
 
 
North America
 
$
1,551

 
$
1,063

 
$
4,637

 
$
3,157

EMEA
 
212

 
219

 
623

 
673

Latin America
 
183

 
200

 
554

 
588

Total Core Network Services Revenue
 
1,946

 
1,482

 
5,814

 
4,418

 
 
 
 
 
 
 
 
 
Wholesale Voice Services and Other Revenue:
 
 
 
 
 
 
 
 
North America
 
110

 
128

 
343

 
410

EMEA
 
3

 
4

 
10

 
14

Latin America
 
3

 
15

 
9

 
21

Total Wholesale Voice Services and Other Revenue
 
116

 
147

 
362

 
445

 
 
 
 
 
 
 
 
 
Total Consolidated Revenue
 
$
2,062

 
$
1,629

 
$
6,176

 
$
4,863

Condensed Consolidating Financial Information (Tables)
Condensed Consolidating Financial Information 
Condensed Consolidating Financial Information

Level 3 Financing, Inc., a wholly owned subsidiary of the Company, has issued senior notes that are unsecured obligations of Level 3 Financing, Inc.; however, they are also fully and unconditionally and jointly and severally guaranteed on an unsecured senior basis by Level 3 Communications, Inc. and Level 3 Communications, LLC.

In conjunction with the registration of the senior notes, the accompanying condensed consolidating financial information has been prepared and presented pursuant to SEC Regulation S-X Rule 3-10 “Financial statements of guarantors and affiliates whose securities collateralize an issue registered or being registered.”

The operating activities of the separate legal entities included in the Company’s Consolidated Financial Statements are interdependent. The accompanying condensed consolidating financial information presents the results of operations, financial position and cash flows of each legal entity and, on an aggregate basis, the other non-guarantor subsidiaries based on amounts incurred by such entities, and is not intended to present the operating results of those legal entities on a stand-alone basis. Level 3 Communications, LLC leases equipment and certain facilities from other wholly owned subsidiaries of Level 3 Communications, Inc. These transactions are eliminated in the consolidated results of the Company.
Condensed Consolidating Statements of Comprehensive Income (Loss)
Three Months Ended September 30, 2015

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
830

 
$
1,271

 
$
(39
)
 
$
2,062

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
300

 
445

 
(39
)
 
706

Network Related Expenses
—

 
—

 
252

 
117

 
—

 
369

Depreciation and Amortization
—

 
—

 
78

 
218

 
—

 
296

Selling, General and Administrative Expenses
1

 
—

 
274

 
89

 
—

 
364

Total Costs and Expenses
1

 
—

 
904

 
869

 
(39
)
 
1,735

Operating Income (Loss)
(1
)
 
—

 
(74
)
 
402

 
—

 
327

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest expense
(9
)
 
(135
)
 
—

 
(1
)
 
—

 
(145
)
Interest income (expense) affiliates, net
320

 
498

 
(763
)
 
(55
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(309
)
 
(671
)
 
—

 
—

 
980

 
—

Other, net
—

 
—

 
3

 
(168
)
 
—

 
(165
)
Total Other Income (Expense)
2

 
(308
)
 
(760
)
 
(224
)
 
980

 
(310
)
Income (Loss) before Income Taxes
1

 
(308
)
 
(834
)
 
178

 
980

 
17

Income Tax Expense
—

 
(1
)
 
—

 
(15
)
 
—

 
(16
)
Net Income (Loss)
1

 
(309
)
 
(834
)
 
163

 
980

 
1

Other Comprehensive Income (Loss), Net of Income Taxes
(72
)
 
—

 
—

 
72

 
(72
)
 
(72
)
Comprehensive Income (Loss)
$
(71
)
 
$
(309
)
 
$
(834
)
 
$
235

 
$
908

 
$
(71
)
Condensed Consolidating Statements of Comprehensive Income (Loss)
Nine Months Ended September 30, 2015
 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
2,478

 
$
3,834

 
$
(136
)
 
$
6,176

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
919

 
1,342

 
(136
)
 
2,125

Network Related Expenses
—

 
—

 
713

 
375

 
—

 
1,088

Depreciation and Amortization
—

 
—

 
227

 
645

 
—

 
872

Selling, General and Administrative Expenses
3

 
—

 
789

 
306

 
—

 
1,098

Total Costs and Expenses
3

 
—

 
2,648

 
2,668

 
(136
)
 
5,183

Operating Income (Loss)
(3
)
 
—

 
(170
)
 
1,166

 
—

 
993

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest Income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(42
)
 
(436
)
 
(2
)
 
(10
)
 
—

 
(490
)
Interest income (expense) affiliates, net
984

 
1,495

 
(2,298
)
 
(181
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(811
)
 
(1,723
)
 
177

 
—

 
2,357

 
—

Other, net
(18
)
 
(145
)
 
2

 
(194
)
 
—

 
(355
)
Total Other Income (Expense)
113

 
(809
)
 
(2,121
)
 
(384
)
 
2,357

 
(844
)
Income (Loss) before Income Taxes
110

 
(809
)
 
(2,291
)
 
782

 
2,357

 
149

Income Tax Expense
—

 
(2
)
 
—

 
(37
)
 
—

 
(39
)
Net Income (Loss)
110

 
(811
)
 
(2,291
)
 
745

 
2,357

 
110

Other Comprehensive Income (Loss), Net of Income Taxes
(128
)
 
—

 
—

 
128

 
(128
)
 
(128
)
Comprehensive Income (Loss)
$
(18
)
 
$
(811
)
 
$
(2,291
)
 
$
873

 
$
2,229

 
$
(18
)
Condensed Consolidating Statements of Comprehensive Income (Loss)
Three Months Ended September 30, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
781

 
$
901

 
$
(53
)
 
$
1,629

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
291

 
369

 
(53
)
 
607

Network Related Expenses
—

 
—

 
195

 
112

 
—

 
307

Depreciation and Amortization
—

 
—

 
70

 
117

 
—

 
187

Selling, General and Administrative Expenses
6

 
—

 
181

 
79

 
—

 
266

Total Costs and Expenses
6

 
—

 
737

 
677

 
(53
)
 
1,367

Operating Income
(6
)
 
—

 
44

 
224

 
—

 
262

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(34
)
 
(112
)
 
(1
)
 
(12
)
 
—

 
(159
)
Interest income (expense) affiliates, net
314

 
452

 
(730
)
 
(36
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(189
)
 
(528
)
 
162

 
—

 
555

 
—

Other, net
—

 
—

 
2

 
(13
)
 
—

 
(11
)
Total Other Expense
91

 
(188
)
 
(567
)
 
(60
)
 
555

 
(169
)
Income (Loss) before Income Taxes
85

 
(188
)
 
(523
)
 
164

 
555

 
93

Income Tax Expense
—

 
(1
)
 
—

 
(7
)
 
—

 
(8
)
Net Income (Loss)
85

 
(189
)
 
(523
)
 
157

 
555

 
85

Other Comprehensive Income (Loss), Net of Income Taxes
(137
)
 
—

 
—

 
(137
)
 
137

 
(137
)
Comprehensive Income (Loss)
$
(52
)
 
$
(189
)
 
$
(523
)
 
$
20

 
$
692

 
$
(52
)
Condensed Consolidating Statements of Comprehensive Income (Loss)
Nine Months Ended September 30, 2014
 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
2,278

 
$
2,750

 
$
(165
)
 
$
4,863

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
869

 
1,130

 
(165
)
 
1,834

Network Related Expenses
—

 
—

 
567

 
334

 
—

 
901

Depreciation and Amortization
—

 
—

 
209

 
349

 
—

 
558

Selling, General and Administrative Expenses
7

 
1

 
505

 
275

 
—

 
788

Total Costs and Expenses
7

 
1

 
2,150

 
2,088

 
(165
)
 
4,081

Operating Income
(7
)
 
(1
)
 
128

 
662

 
—

 
782

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(102
)
 
(337
)
 
(1
)
 
(19
)
 
—

 
(459
)
Interest income (expense) affiliates, net
905

 
1,370

 
(2,169
)
 
(106
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(548
)
 
(1,577
)
 
502

 
—

 
1,623

 
—

Other, net
—

 
—

 
6

 
(55
)
 
—

 
(49
)
Total Other Expense
255

 
(544
)
 
(1,662
)
 
(179
)
 
1,623

 
(507
)
Income (Loss) before Income Taxes
248

 
(545
)
 
(1,534
)
 
483

 
1,623

 
275

Income Tax Expense
—

 
(3
)
 
(1
)
 
(23
)
 
—

 
(27
)
Net Income (Loss)
248

 
(548
)
 
(1,535
)
 
460

 
1,623

 
248

Other Comprehensive Income (Loss), Net of Income Taxes
(118
)
 
—

 
—

 
(118
)
 
118

 
(118
)
Comprehensive Income (Loss)
$
130

 
$
(548
)
 
$
(1,535
)
 
$
342

 
$
1,741

 
$
130

Condensed Consolidating Balance Sheets
September 30, 2015

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
13

 
$
6

 
$
559

 
$
113

 
$
—

 
$
691

Restricted cash and securities
—

 
—

 
1

 
6

 
—

 
7

Receivables, less allowances for doubtful accounts
—

 
—

 
68

 
742

 
—

 
810

Due from affiliates
15,304

 
22,482

 
—

 
—

 
(37,786
)
 
—

Other
1

 
19

 
67

 
68

 
—

 
155

Total Current Assets
15,318

 
22,507

 
695

 
929

 
(37,786
)
 
1,663

Property, Plant, and Equipment, net
—

 
—

 
3,320

 
6,492

 
—

 
9,812

Restricted Cash and Securities
27

 
—

 
15

 
2

 
—

 
44

Goodwill and Other Intangibles, net
—

 
—

 
365

 
8,570

 
—

 
8,935

Investment in Subsidiaries
16,737

 
14,542

 
3,737

 
—

 
(35,016
)
 
—

Other Assets, net
20

 
119

 
11

 
279

 
—

 
429

Total Assets
$
32,102

 
$
37,168

 
$
8,143

 
$
16,272

 
$
(72,802
)
 
$
20,883

 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity (Deficit)
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
1

 
$
194

 
$
435

 
$
—

 
$
630

Current portion of long-term debt
—

 
—

 
3

 
13

 
—

 
16

Accrued payroll and employee benefits
—

 
—

 
198

 
32

 
—

 
230

Accrued interest
3

 
128

 
—

 
6

 
—

 
137

Current portion of deferred revenue
—

 
—

 
113

 
160

 
—

 
273

Due to affiliates
—

 
—

 
36,981

 
805

 
(37,786
)
 
—

Other
—

 
—

 
94

 
90

 
—

 
184

Total Current Liabilities
3

 
129

 
37,583

 
1,541

 
(37,786
)
 
1,470

Long-Term Debt, less current portion
600

 
10,209

 
15

 
173

 
—

 
10,997

Deferred Revenue, less current portion
—

 
—

 
648

 
294

 
—

 
942

Other Liabilities
15

 
27

 
132

 
520

 
—

 
694

Commitments and Contingencies

 

 

 

 

 

Stockholders' Equity (Deficit)
31,484

 
26,803

 
(30,235
)
 
13,744

 
(35,016
)
 
6,780

Total Liabilities and Stockholders' Equity (Deficit)
$
32,102

 
$
37,168

 
$
8,143

 
$
16,272

 
$
(72,802
)
 
$
20,883

Condensed Consolidating Balance Sheets
December 31, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
7

 
$
5

 
$
307

 
$
261

 
$
—

 
$
580

Restricted cash and securities
—

 
—

 
1

 
6

 
—

 
7

Receivables, less allowances for doubtful accounts
—

 
—

 
34

 
703

 
—

 
737

Due from affiliates
14,522

 
21,270

 
—

 
—

 
(35,792
)
 
—

Other
2

 
21

 
45

 
97

 
—

 
165

Total Current Assets
14,531

 
21,296

 
387

 
1,067

 
(35,792
)
 
1,489

Property, Plant, and Equipment, net
—

 
—

 
3,152

 
6,708

 
—

 
9,860

Restricted Cash and Securities
3

 
—

 
16

 
1

 
—

 
20

Goodwill and Other Intangibles, net
—

 
—

 
373

 
8,730

 
—

 
9,103

Investment in Subsidiaries
16,686

 
14,777

 
3,729

 
—

 
(35,192
)
 
—

Other Assets, net
28

 
129

 
9

 
309

 
—

 
475

Total Assets
$
31,248

 
$
36,202

 
$
7,666

 
$
16,815

 
$
(70,984
)
 
$
20,947

 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity (Deficit)
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
—

 
$
215

 
$
449

 
$
—

 
$
664

Current portion of long-term debt
333

 
—

 
3

 
13

 
—

 
349

Accrued payroll and employee benefits
—

 
—

 
174

 
99

 
—

 
273

Accrued interest
12

 
158

 
—

 
4

 
—

 
174

Current portion of deferred revenue
—

 
—

 
118

 
169

 
—

 
287

Due to affiliates
—

 
—

 
34,401

 
1,391

 
(35,792
)
 
—

Other
—

 
2

 
62

 
103

 
—

 
167

Total Current Liabilities
345

 
160

 
34,973

 
2,228

 
(35,792
)
 
1,914

Long-Term Debt, less current portion
900

 
9,893

 
16

 
175

 
—

 
10,984

Deferred Revenue, less current portion
—

 
—

 
617

 
304

 
—

 
921

Other Liabilities
16

 
24

 
125

 
600

 
—

 
765

Commitments and Contingencies

 

 

 

 

 

Stockholders' Equity (Deficit)
29,987

 
26,125

 
(28,065
)
 
13,508

 
(35,192
)
 
6,363

Total Liabilities and Stockholders' Equity (Deficit)
$
31,248

 
$
36,202

 
$
7,666

 
$
16,815

 
$
(70,984
)
 
$
20,947

Condensed Consolidating Statements of Cash Flows
Nine Months Ended September 30, 2015

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities
$
(39
)
 
$
(447
)
 
$
57

 
$
1,728

 
$
—

 
$
1,299

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital Expenditures
—

 
—

 
(307
)
 
(592
)
 
—

 
(899
)
Cash related to deconsolidated Venezuela operations
—

 
—

 
—

 
(83
)
 
 
 
(83
)
(Increase) decrease in restricted cash and securities, net
(25
)
 
—

 
1

 
—

 
—

 
(24
)
Proceeds from the sale of property, plant and equipment and other assets
—

 
—

 
—

 
3

 
—

 
3

Other
—

 
—

 
(14
)
 
—

 
—

 
(14
)
Net Cash Used in Investing Activities
(25
)
 
—

 
(320
)
 
(672
)
 
—

 
(1,017
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
—

 
3,947

 
—

 
—

 
—

 
3,947

Payments on and repurchases of long-term debt, including current portion and refinancing costs
(313
)
 
(3,780
)
 
(1
)
 
(8
)
 
—

 
(4,102
)
Increase (decrease) due from/to affiliates, net
383

 
281

 
516

 
(1,180
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities
70

 
448

 
515

 
(1,188
)
 
—

 
(155
)
Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
(16
)
 
—

 
(16
)
Net Change in Cash and Cash Equivalents
6

 
1

 
252

 
(148
)
 
—

 
111

Cash and Cash Equivalents at Beginning of Period
7

 
5

 
307

 
261

 
—

 
580

Cash and Cash Equivalents at End of Period
$
13

 
$
6

 
$
559

 
$
113

 
$
—

 
$
691

Condensed Consolidating Statements of Cash Flows
Nine Months Ended September 30, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities
$
(91
)
 
$
(336
)
 
$
443

 
$
749

 
$
—

 
$
765

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital Expenditures
—

 
—

 
(261
)
 
(347
)
 
—

 
(608
)
Decrease in restricted cash and securities, net
—

 
—

 
1

 
(11
)
 
—

 
(10
)
Proceeds from sale of property, plant and equipment and other assets
—

 
—

 
—

 
3

 
—

 
3

Other
—

 
—

 
—

 
(2
)
 
—

 
(2
)
Net Cash Used in Investing Activities
—

 
—

 
(260
)
 
(357
)
 
—

 
(617
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
—

 
—

 
—

 
(1
)
 
—

 
(1
)
Payments on and repurchases of long-term debt, including current portion and refinancing costs
—

 
—

 
—

 
(8
)
 
—

 
(8
)
Increase (decrease) due from/to affiliates, net
90

 
335

 
(6
)
 
(419
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities
90

 
335

 
(6
)
 
(428
)
 
—

 
(9
)
Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
(41
)
 
—

 
(41
)
Net Change in Cash and Cash Equivalents
(1
)
 
(1
)
 
177

 
(77
)
 
—

 
98

Cash and Cash Equivalents at Beginning of Period
8

 
6

 
347

 
270

 
—

 
631

Cash and Cash Equivalents at End of Period
$
7

 
$
5

 
$
524

 
$
193

 
$
—

 
$
729

Schedule of Condensed Consolidating Statements of Comprehensive Income (Loss) 
Condensed Consolidating Statements of Comprehensive Income (Loss)
Three Months Ended September 30, 2015

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
830

 
$
1,271

 
$
(39
)
 
$
2,062

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
300

 
445

 
(39
)
 
706

Network Related Expenses
—

 
—

 
252

 
117

 
—

 
369

Depreciation and Amortization
—

 
—

 
78

 
218

 
—

 
296

Selling, General and Administrative Expenses
1

 
—

 
274

 
89

 
—

 
364

Total Costs and Expenses
1

 
—

 
904

 
869

 
(39
)
 
1,735

Operating Income (Loss)
(1
)
 
—

 
(74
)
 
402

 
—

 
327

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest expense
(9
)
 
(135
)
 
—

 
(1
)
 
—

 
(145
)
Interest income (expense) affiliates, net
320

 
498

 
(763
)
 
(55
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(309
)
 
(671
)
 
—

 
—

 
980

 
—

Other, net
—

 
—

 
3

 
(168
)
 
—

 
(165
)
Total Other Income (Expense)
2

 
(308
)
 
(760
)
 
(224
)
 
980

 
(310
)
Income (Loss) before Income Taxes
1

 
(308
)
 
(834
)
 
178

 
980

 
17

Income Tax Expense
—

 
(1
)
 
—

 
(15
)
 
—

 
(16
)
Net Income (Loss)
1

 
(309
)
 
(834
)
 
163

 
980

 
1

Other Comprehensive Income (Loss), Net of Income Taxes
(72
)
 
—

 
—

 
72

 
(72
)
 
(72
)
Comprehensive Income (Loss)
$
(71
)
 
$
(309
)
 
$
(834
)
 
$
235

 
$
908

 
$
(71
)
Condensed Consolidating Statements of Comprehensive Income (Loss)
Nine Months Ended September 30, 2015
 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
2,478

 
$
3,834

 
$
(136
)
 
$
6,176

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
919

 
1,342

 
(136
)
 
2,125

Network Related Expenses
—

 
—

 
713

 
375

 
—

 
1,088

Depreciation and Amortization
—

 
—

 
227

 
645

 
—

 
872

Selling, General and Administrative Expenses
3

 
—

 
789

 
306

 
—

 
1,098

Total Costs and Expenses
3

 
—

 
2,648

 
2,668

 
(136
)
 
5,183

Operating Income (Loss)
(3
)
 
—

 
(170
)
 
1,166

 
—

 
993

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest Income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(42
)
 
(436
)
 
(2
)
 
(10
)
 
—

 
(490
)
Interest income (expense) affiliates, net
984

 
1,495

 
(2,298
)
 
(181
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(811
)
 
(1,723
)
 
177

 
—

 
2,357

 
—

Other, net
(18
)
 
(145
)
 
2

 
(194
)
 
—

 
(355
)
Total Other Income (Expense)
113

 
(809
)
 
(2,121
)
 
(384
)
 
2,357

 
(844
)
Income (Loss) before Income Taxes
110

 
(809
)
 
(2,291
)
 
782

 
2,357

 
149

Income Tax Expense
—

 
(2
)
 
—

 
(37
)
 
—

 
(39
)
Net Income (Loss)
110

 
(811
)
 
(2,291
)
 
745

 
2,357

 
110

Other Comprehensive Income (Loss), Net of Income Taxes
(128
)
 
—

 
—

 
128

 
(128
)
 
(128
)
Comprehensive Income (Loss)
$
(18
)
 
$
(811
)
 
$
(2,291
)
 
$
873

 
$
2,229

 
$
(18
)
Condensed Consolidating Statements of Comprehensive Income (Loss)
Three Months Ended September 30, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
781

 
$
901

 
$
(53
)
 
$
1,629

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
291

 
369

 
(53
)
 
607

Network Related Expenses
—

 
—

 
195

 
112

 
—

 
307

Depreciation and Amortization
—

 
—

 
70

 
117

 
—

 
187

Selling, General and Administrative Expenses
6

 
—

 
181

 
79

 
—

 
266

Total Costs and Expenses
6

 
—

 
737

 
677

 
(53
)
 
1,367

Operating Income
(6
)
 
—

 
44

 
224

 
—

 
262

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(34
)
 
(112
)
 
(1
)
 
(12
)
 
—

 
(159
)
Interest income (expense) affiliates, net
314

 
452

 
(730
)
 
(36
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(189
)
 
(528
)
 
162

 
—

 
555

 
—

Other, net
—

 
—

 
2

 
(13
)
 
—

 
(11
)
Total Other Expense
91

 
(188
)
 
(567
)
 
(60
)
 
555

 
(169
)
Income (Loss) before Income Taxes
85

 
(188
)
 
(523
)
 
164

 
555

 
93

Income Tax Expense
—

 
(1
)
 
—

 
(7
)
 
—

 
(8
)
Net Income (Loss)
85

 
(189
)
 
(523
)
 
157

 
555

 
85

Other Comprehensive Income (Loss), Net of Income Taxes
(137
)
 
—

 
—

 
(137
)
 
137

 
(137
)
Comprehensive Income (Loss)
$
(52
)
 
$
(189
)
 
$
(523
)
 
$
20

 
$
692

 
$
(52
)
Condensed Consolidating Statements of Comprehensive Income (Loss)
Nine Months Ended September 30, 2014
 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Revenue
$
—

 
$
—

 
$
2,278

 
$
2,750

 
$
(165
)
 
$
4,863

Costs and Expense:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
869

 
1,130

 
(165
)
 
1,834

Network Related Expenses
—

 
—

 
567

 
334

 
—

 
901

Depreciation and Amortization
—

 
—

 
209

 
349

 
—

 
558

Selling, General and Administrative Expenses
7

 
1

 
505

 
275

 
—

 
788

Total Costs and Expenses
7

 
1

 
2,150

 
2,088

 
(165
)
 
4,081

Operating Income
(7
)
 
(1
)
 
128

 
662

 
—

 
782

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(102
)
 
(337
)
 
(1
)
 
(19
)
 
—

 
(459
)
Interest income (expense) affiliates, net
905

 
1,370

 
(2,169
)
 
(106
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(548
)
 
(1,577
)
 
502

 
—

 
1,623

 
—

Other, net
—

 
—

 
6

 
(55
)
 
—

 
(49
)
Total Other Expense
255

 
(544
)
 
(1,662
)
 
(179
)
 
1,623

 
(507
)
Income (Loss) before Income Taxes
248

 
(545
)
 
(1,534
)
 
483

 
1,623

 
275

Income Tax Expense
—

 
(3
)
 
(1
)
 
(23
)
 
—

 
(27
)
Net Income (Loss)
248

 
(548
)
 
(1,535
)
 
460

 
1,623

 
248

Other Comprehensive Income (Loss), Net of Income Taxes
(118
)
 
—

 
—

 
(118
)
 
118

 
(118
)
Comprehensive Income (Loss)
$
130

 
$
(548
)
 
$
(1,535
)
 
$
342

 
$
1,741

 
$
130

Schedule of Condensed Consolidating Balance Sheets 
Condensed Consolidating Balance Sheets
September 30, 2015

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
13

 
$
6

 
$
559

 
$
113

 
$
—

 
$
691

Restricted cash and securities
—

 
—

 
1

 
6

 
—

 
7

Receivables, less allowances for doubtful accounts
—

 
—

 
68

 
742

 
—

 
810

Due from affiliates
15,304

 
22,482

 
—

 
—

 
(37,786
)
 
—

Other
1

 
19

 
67

 
68

 
—

 
155

Total Current Assets
15,318

 
22,507

 
695

 
929

 
(37,786
)
 
1,663

Property, Plant, and Equipment, net
—

 
—

 
3,320

 
6,492

 
—

 
9,812

Restricted Cash and Securities
27

 
—

 
15

 
2

 
—

 
44

Goodwill and Other Intangibles, net
—

 
—

 
365

 
8,570

 
—

 
8,935

Investment in Subsidiaries
16,737

 
14,542

 
3,737

 
—

 
(35,016
)
 
—

Other Assets, net
20

 
119

 
11

 
279

 
—

 
429

Total Assets
$
32,102

 
$
37,168

 
$
8,143

 
$
16,272

 
$
(72,802
)
 
$
20,883

 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity (Deficit)
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
1

 
$
194

 
$
435

 
$
—

 
$
630

Current portion of long-term debt
—

 
—

 
3

 
13

 
—

 
16

Accrued payroll and employee benefits
—

 
—

 
198

 
32

 
—

 
230

Accrued interest
3

 
128

 
—

 
6

 
—

 
137

Current portion of deferred revenue
—

 
—

 
113

 
160

 
—

 
273

Due to affiliates
—

 
—

 
36,981

 
805

 
(37,786
)
 
—

Other
—

 
—

 
94

 
90

 
—

 
184

Total Current Liabilities
3

 
129

 
37,583

 
1,541

 
(37,786
)
 
1,470

Long-Term Debt, less current portion
600

 
10,209

 
15

 
173

 
—

 
10,997

Deferred Revenue, less current portion
—

 
—

 
648

 
294

 
—

 
942

Other Liabilities
15

 
27

 
132

 
520

 
—

 
694

Commitments and Contingencies

 

 

 

 

 

Stockholders' Equity (Deficit)
31,484

 
26,803

 
(30,235
)
 
13,744

 
(35,016
)
 
6,780

Total Liabilities and Stockholders' Equity (Deficit)
$
32,102

 
$
37,168

 
$
8,143

 
$
16,272

 
$
(72,802
)
 
$
20,883

Condensed Consolidating Balance Sheets
December 31, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
7

 
$
5

 
$
307

 
$
261

 
$
—

 
$
580

Restricted cash and securities
—

 
—

 
1

 
6

 
—

 
7

Receivables, less allowances for doubtful accounts
—

 
—

 
34

 
703

 
—

 
737

Due from affiliates
14,522

 
21,270

 
—

 
—

 
(35,792
)
 
—

Other
2

 
21

 
45

 
97

 
—

 
165

Total Current Assets
14,531

 
21,296

 
387

 
1,067

 
(35,792
)
 
1,489

Property, Plant, and Equipment, net
—

 
—

 
3,152

 
6,708

 
—

 
9,860

Restricted Cash and Securities
3

 
—

 
16

 
1

 
—

 
20

Goodwill and Other Intangibles, net
—

 
—

 
373

 
8,730

 
—

 
9,103

Investment in Subsidiaries
16,686

 
14,777

 
3,729

 
—

 
(35,192
)
 
—

Other Assets, net
28

 
129

 
9

 
309

 
—

 
475

Total Assets
$
31,248

 
$
36,202

 
$
7,666

 
$
16,815

 
$
(70,984
)
 
$
20,947

 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity (Deficit)
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
—

 
$
215

 
$
449

 
$
—

 
$
664

Current portion of long-term debt
333

 
—

 
3

 
13

 
—

 
349

Accrued payroll and employee benefits
—

 
—

 
174

 
99

 
—

 
273

Accrued interest
12

 
158

 
—

 
4

 
—

 
174

Current portion of deferred revenue
—

 
—

 
118

 
169

 
—

 
287

Due to affiliates
—

 
—

 
34,401

 
1,391

 
(35,792
)
 
—

Other
—

 
2

 
62

 
103

 
—

 
167

Total Current Liabilities
345

 
160

 
34,973

 
2,228

 
(35,792
)
 
1,914

Long-Term Debt, less current portion
900

 
9,893

 
16

 
175

 
—

 
10,984

Deferred Revenue, less current portion
—

 
—

 
617

 
304

 
—

 
921

Other Liabilities
16

 
24

 
125

 
600

 
—

 
765

Commitments and Contingencies

 

 

 

 

 

Stockholders' Equity (Deficit)
29,987

 
26,125

 
(28,065
)
 
13,508

 
(35,192
)
 
6,363

Total Liabilities and Stockholders' Equity (Deficit)
$
31,248

 
$
36,202

 
$
7,666

 
$
16,815

 
$
(70,984
)
 
$
20,947

Schedule of Condensed Consolidating Statements of Cash Flows 
Condensed Consolidating Statements of Cash Flows
Nine Months Ended September 30, 2015

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities
$
(39
)
 
$
(447
)
 
$
57

 
$
1,728

 
$
—

 
$
1,299

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital Expenditures
—

 
—

 
(307
)
 
(592
)
 
—

 
(899
)
Cash related to deconsolidated Venezuela operations
—

 
—

 
—

 
(83
)
 
 
 
(83
)
(Increase) decrease in restricted cash and securities, net
(25
)
 
—

 
1

 
—

 
—

 
(24
)
Proceeds from the sale of property, plant and equipment and other assets
—

 
—

 
—

 
3

 
—

 
3

Other
—

 
—

 
(14
)
 
—

 
—

 
(14
)
Net Cash Used in Investing Activities
(25
)
 
—

 
(320
)
 
(672
)
 
—

 
(1,017
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
—

 
3,947

 
—

 
—

 
—

 
3,947

Payments on and repurchases of long-term debt, including current portion and refinancing costs
(313
)
 
(3,780
)
 
(1
)
 
(8
)
 
—

 
(4,102
)
Increase (decrease) due from/to affiliates, net
383

 
281

 
516

 
(1,180
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities
70

 
448

 
515

 
(1,188
)
 
—

 
(155
)
Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
(16
)
 
—

 
(16
)
Net Change in Cash and Cash Equivalents
6

 
1

 
252

 
(148
)
 
—

 
111

Cash and Cash Equivalents at Beginning of Period
7

 
5

 
307

 
261

 
—

 
580

Cash and Cash Equivalents at End of Period
$
13

 
$
6

 
$
559

 
$
113

 
$
—

 
$
691



Condensed Consolidating Statements of Cash Flows
Nine Months Ended September 30, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
 
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities
$
(91
)
 
$
(336
)
 
$
443

 
$
749

 
$
—

 
$
765

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital Expenditures
—

 
—

 
(261
)
 
(347
)
 
—

 
(608
)
Decrease in restricted cash and securities, net
—

 
—

 
1

 
(11
)
 
—

 
(10
)
Proceeds from sale of property, plant and equipment and other assets
—

 
—

 
—

 
3

 
—

 
3

Other
—

 
—

 
—

 
(2
)
 
—

 
(2
)
Net Cash Used in Investing Activities
—

 
—

 
(260
)
 
(357
)
 
—

 
(617
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
—

 
—

 
—

 
(1
)
 
—

 
(1
)
Payments on and repurchases of long-term debt, including current portion and refinancing costs
—

 
—

 
—

 
(8
)
 
—

 
(8
)
Increase (decrease) due from/to affiliates, net
90

 
335

 
(6
)
 
(419
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities
90

 
335

 
(6
)
 
(428
)
 
—

 
(9
)
Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
(41
)
 
—

 
(41
)
Net Change in Cash and Cash Equivalents
(1
)
 
(1
)
 
177

 
(77
)
 
—

 
98

Cash and Cash Equivalents at Beginning of Period
8

 
6

 
347

 
270

 
—

 
631

Cash and Cash Equivalents at End of Period
$
7

 
$
5

 
$
524

 
$
193

 
$
—

 
$
729

Organization and Summary of Significant Accounting Policies Principles of Consolidation and Basis of Presentation (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Sep. 1, 2015
Jun. 30, 2015
Principles of Consolidation and Basis of Presentation [Abstract]
 
 
 
 
 
 
Foreign Currency Transaction Loss, before Tax
$ 5 
 
 
 
 
 
Foreign Currency Exchange Rate, Translation
 
 
 
 
13.5 
12.8 
Venezuela deconsolidation charge
171 
0 
171 
0 
 
 
intercompany receivables write-off
40 
 
 
 
 
 
Cash related to deconsolidated Venezuela operations
$ 83 
 
$ 83 
$ 0 
 
 
Events Associated with the Merger of tw telecom (Details) (USD $)
3 Months Ended 9 Months Ended 16 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Oct. 31, 2014
Business Acquisition [Line Items]
 
 
 
 
 
 
Cash, Cash Equivalents and Restricted Cash
 
 
 
 
 
$ 309,000,000 
Total Revenue
 
2,038,000,000 
 
6,071,000,000 
 
 
Net Income
 
81,000,000 
 
229,000,000 
 
 
Net Income per Share, Basic
 
$ 0.24 
 
$ 0.69 
 
 
Net Income per Share, Diluted
 
$ 0.24 
 
$ 0.68 
 
 
Business Acquisition, Effective Date of Acquisition
Oct. 31, 2014 
 
 
 
 
 
business acquisition, cash consideration per share
10 
 
 
 
 
 
Purchase price allocation adjustment
 
 
60,000,000 
 
 
 
Long-term Debt
 
 
 
 
 
(2,099,000,000)
Stock consideration per share
0.7 
 
 
 
 
 
Business Combination, Integration Related Costs
 
 
 
 
109,000,000 
 
Property, Plant, and Equipment
 
 
 
 
 
1,554,000,000 
Goodwill
 
 
 
 
 
5,178,000,000 
Identifiable Intangible Assets
 
 
 
 
 
1,263,000,000 
Other Assets
 
 
 
 
 
142,000,000 
total Assets
 
 
 
 
 
8,446,000,000 
Deferred Revenue
 
 
 
 
 
(57,000,000)
Other Liabilities
 
 
 
 
 
(279,000,000)
Total Liabilities
 
 
 
 
 
(2,435,000,000)
Total Consideration to be Allocated
 
 
 
 
 
$ 6,011,000,000 
Earnings Per Share (Details)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Convertible Senior Notes
 
 
Earnings per share
 
 
Securities not included in computation of diluted earnings per share (in millions of shares)
 
18 
Stock options, outperform stock appreciation rights (OSOs), restricted stock units and warrants
 
 
Earnings per share
 
 
Stock Awards Included in Computation of Earnings Per Share, Amount
4 
5 
Acquired Intangible Assets (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Finite-Lived Intangible Assets:
 
 
 
 
 
Finite-Lived Intangible Assets, Gross Carrying Amount
$ 2,260 
 
$ 2,260 
 
$ 2,320 
Finite-Lived Intangible Assets, Accumulated Amortization
(1,093)
 
(1,093)
 
(921)
Finite-Lived Intangible Assets, Net
1,167 
 
1,167 
 
1,399 
Acquired finite-lived intangible asset amortization expense
58 
14 
172 
50 
 
Indefinite-Lived Intangible Assets:
 
 
 
 
 
Total identifiable acquisition-related intangible assets, Gross Carrying Amount
2,275 
 
2,275 
 
2,335 
Total identifiable acquisition-related intangible assets, Net
1,182 
 
1,182 
 
1,414 
Estimated amortization expense of finite-lived acquisition-related intangible assets
 
 
 
 
 
2013 (remaining three months)
54 
 
54 
 
 
2014
212 
 
212 
 
 
2015
196 
 
196 
 
 
2016
193 
 
193 
 
 
2017
182 
 
182 
 
 
2018
166 
 
166 
 
 
Thereafter
164 
 
164 
 
 
Finite-Lived Intangible Assets, Net
1,167 
 
1,167 
 
1,399 
Vyvx Trade Name
 
 
 
 
 
Indefinite-Lived Intangible Assets:
 
 
 
 
 
Indefinite-Lived Intangible Assets
15 
 
15 
 
15 
Customer Contracts And Relationships
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Finite-Lived Intangible Assets, Gross Carrying Amount
1,975 
 
1,975 
 
1,977 
Finite-Lived Intangible Assets, Accumulated Amortization
(884)
 
(884)
 
(741)
Finite-Lived Intangible Assets, Net
1,091 
 
1,091 
 
1,236 
Acquired finite-lived intangible assets weighted average remaining useful lives (in years)
 
 
6 years 1 month 6 days 
 
 
Estimated amortization expense of finite-lived acquisition-related intangible assets
 
 
 
 
 
Finite-Lived Intangible Assets, Net
1,091 
 
1,091 
 
1,236 
Trademarks
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Finite-Lived Intangible Assets, Gross Carrying Amount
55 
 
55 
 
115 
Finite-Lived Intangible Assets, Accumulated Amortization
(55)
 
(55)
 
(47)
Finite-Lived Intangible Assets, Net
0 
 
0 
 
68 
Estimated amortization expense of finite-lived acquisition-related intangible assets
 
 
 
 
 
Finite-Lived Intangible Assets, Net
0 
 
0 
 
68 
Patents and Developed Technology
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Finite-Lived Intangible Assets, Gross Carrying Amount
230 
 
230 
 
228 
Finite-Lived Intangible Assets, Accumulated Amortization
(154)
 
(154)
 
(133)
Finite-Lived Intangible Assets, Net
76 
 
76 
 
95 
Acquired finite-lived intangible assets weighted average remaining useful lives (in years)
 
 
3 years 4 months 24 days 
 
 
Estimated amortization expense of finite-lived acquisition-related intangible assets
 
 
 
 
 
Finite-Lived Intangible Assets, Net
$ 76 
 
$ 76 
 
$ 95 
Fair Value of Financial Instruments - Liabilities, Recurring (Details) (Fair Value, Measurements, Recurring, USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Total Carrying Value in Consolidated Balance Sheet
 
 
Long-term Debt, including the current portion:
 
 
Term Loans
$ 4,594 
$ 4,590 
Senior Notes
6,215 
6,203 
Convertible Notes
0 
333 
Capital Leases and Other
204 
207 
Total Long-term Debt, including the current portion:
11,013 
11,333 
Unadjusted Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)
 
 
Long-term Debt, including the current portion:
 
 
Term Loans
4,589 
4,593 
Senior Notes
6,158 
6,481 
Convertible Notes
0 
0 
Capital Leases and Other
0 
0 
Total Long-term Debt, including the current portion:
10,747 
11,074 
Significant Other Observable Inputs (Level 2)
 
 
Long-term Debt, including the current portion:
 
 
Term Loans
0 
0 
Senior Notes
0 
0 
Convertible Notes
0 
868 
Capital Leases and Other
204 
207 
Total Long-term Debt, including the current portion:
$ 204 
$ 1,075 
Long-Term Debt - Schedule of Long Term Debt (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Long-term debt
 
 
Total Debt Obligations
$ 11,030 
$ 11,366 
Total Unamortized Discount
(17)
(33)
Carrying Value of Debt
11,013 
11,333 
Current portion of long-term debt
(16)
(349)
Long-Term Debt, less current portion
10,997 
10,984 
Senior Secured Term Loan
 
 
Long-term debt
 
 
Total Debt Obligations
4,611 1
4,611 1
Total Unamortized Discount
(17)
(21)
Tranche B-III 2019 Term Loan
 
 
Long-term debt
 
 
Debt Instrument, Face Amount
815 
 
Tranche B 2020 Term Loan
 
 
Long-term debt
 
 
Stated interest rate (as a percent)
4.00% 
 
Total Debt Obligations
1,796 
 
Floating Rate Senior Notes due 2018 [Member]
 
 
Long-term debt
 
 
Stated interest rate (as a percent)
3.914% 
3.826% 
Total Debt Obligations
300 
300 
9.375% Senior Notes due 2019
 
 
Long-term debt
 
 
Total Debt Obligations
0 
500 
Total Unamortized Discount
0 
(6)
8.125% Senior Notes due 2019
 
 
Long-term debt
 
 
Total Debt Obligations
0 
1,200 
Total Unamortized Discount
0 
(6)
8.875% Senior Notes due 2019
 
 
Long-term debt
 
 
Total Debt Obligations
0 
300 
8.625% Senior Notes due 2020
 
 
Long-term debt
 
 
Total Debt Obligations
900 
900 
7.0% Senior Notes due 2020
 
 
Long-term debt
 
 
Total Debt Obligations
775 
775 
SeniorNotes6Point125PercentDue2021 [Member]
 
 
Long-term debt
 
 
Total Debt Obligations
640 
640 
5.37percent Senior Notes Due 2022 [Member]
 
 
Long-term debt
 
 
Total Debt Obligations
1,000 
1,000 
Senior Notes 5point75Percent Due 2022 [Member]
 
 
Long-term debt
 
 
Total Debt Obligations
600 
600 
Senior Notes 5point 625Percent Due 2023 [Member]
 
 
Long-term debt
 
 
Total Debt Obligations
500 
0 
Senior Notes 5point 125Percent Due 2023 [Member]
 
 
Long-term debt
 
 
Total Debt Obligations
700 
0 
Senior Notes 5point 375Percent Due 2025 [Member]
 
 
Long-term debt
 
 
Total Debt Obligations
800 
0 
7.0% Convertible Senior Notes due 2015
 
 
Long-term debt
 
 
Total Debt Obligations
0 
58 
7.0% Convertible Senior Notes due 2015 Series B
 
 
Long-term debt
 
 
Total Debt Obligations
0 
275 
Capital Leases
 
 
Long-term debt
 
 
Total Debt Obligations
204 
207 
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member]
 
 
Long-term debt
 
 
Convertible Debt, Fair Value Disclosures
$ 0 
$ 868 
Long-Term Debt - Textuals (Details) (USD $)
9 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 3 Months Ended 3 Months Ended
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2015
Senior Notes 5point 125Percent Due 2023 [Member]
Dec. 31, 2014
Senior Notes 5point 125Percent Due 2023 [Member]
Sep. 30, 2015
Senior Notes 5point 125Percent Due 2023 [Member]
Level 3 Financing [Member]
Apr. 28, 2015
Senior Notes 5point 125Percent Due 2023 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Senior Notes 5point 625Percent Due 2023 [Member]
Dec. 31, 2014
Senior Notes 5point 625Percent Due 2023 [Member]
Sep. 30, 2015
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing, Inc.
Sep. 30, 2015
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing [Member]
Jan. 29, 2015
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing [Member]
Dec. 31, 2014
Tranche B 2022 Term Loans [Member]
May 8, 2015
Tranche B 2022 Term Loans [Member]
Level 3 Financing, Inc.
Sep. 30, 2015
Tranche B 2022 Term Loans [Member]
Level 3 Financing [Member]
Oct. 31, 2014
Tranche B 2022 Term Loans [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Tranche B 2022 Term Loans [Member]
Level 3 Financing [Member]
London Interbank Offered Rate (LIBOR) [Member]
Sep. 30, 2015
TrancheB-II2022TermLoanTotal [Member]
Sep. 30, 2015
Tranche B 2020 Term Loan
Sep. 30, 2015
Tranche B-III 2019 Term Loan
Sep. 30, 2015
8.875% Senior Notes due 2019
Dec. 31, 2014
8.875% Senior Notes due 2019
Sep. 30, 2015
8.875% Senior Notes due 2019
Level 3 Financing [Member]
Apr. 28, 2015
8.875% Senior Notes due 2019
Level 3 Financing [Member]
Jul. 31, 2012
8.875% Senior Notes due 2019
Level 3 Financing [Member]
Sep. 30, 2015
7.0% Senior Notes due 2020
Dec. 31, 2014
7.0% Senior Notes due 2020
Sep. 30, 2015
9.375% Senior Notes due 2019
Dec. 31, 2014
9.375% Senior Notes due 2019
Sep. 30, 2015
9.375% Senior Notes due 2019
Level 3 Financing [Member]
Mar. 4, 2011
9.375% Senior Notes due 2019
Level 3 Financing [Member]
Sep. 30, 2015
7.0% Convertible Senior Notes due 2015
Dec. 31, 2014
7.0% Convertible Senior Notes due 2015
Sep. 30, 2015
7.0% Convertible Senior Notes due 2015
Level 3 Communications, Inc.
Sep. 30, 2015
Senior Notes 5point 375Percent Due 2025 [Member]
Dec. 31, 2014
Senior Notes 5point 375Percent Due 2025 [Member]
Sep. 30, 2015
Senior Notes 5point 375Percent Due 2025 [Member]
Level 3 Financing [Member]
Apr. 28, 2015
Senior Notes 5point 375Percent Due 2025 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Senior Notes 5.125Percent Due 2023 and 5.375Percent Due 2025 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
8.125% Senior Notes due 2019
Dec. 31, 2014
8.125% Senior Notes due 2019
Sep. 30, 2015
8.125% Senior Notes due 2019
Level 3 Financing [Member]
Apr. 28, 2015
8.125% Senior Notes due 2019
Level 3 Financing [Member]
Jun. 9, 2011
8.125% Senior Notes due 2019
Level 3 Financing [Member]
Sep. 30, 2015
2.0 Billion Tranche B-II 2022 Term Loan [Member]
Level 3 Financing [Member]
May 8, 2015
2.0 Billion Tranche B-II 2022 Term Loan [Member]
Level 3 Financing [Member]
Sep. 30, 2015
2.0 Billion Tranche B-II 2022 Term Loan [Member]
Level 3 Financing [Member]
London Interbank Offered Rate (LIBOR) [Member]
Sep. 30, 2015
Twelve Months Beginning February 1, 2018 [Member]
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Twelve Months Beginning May 1, 2018 [Member]
Senior Notes 5point 125Percent Due 2023 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Twelve Months Beginning May1, 2019 [Member]
Senior Notes 5point 125Percent Due 2023 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Twelve Months Beginning February 1, 2019 [Member]
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Prior to February 1, 2018 [Member]
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing [Member]
days
Sep. 30, 2015
Twelve Months Beginning February 1, 2020 [Member]
Senior Notes 5point 125Percent Due 2023 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Twelve Months Beginning February 1, 2020 [Member]
Senior Notes 5point 375Percent Due 2025 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Twelve Months Beginning February 1, 2019 [Member]
Senior Notes 5point 375Percent Due 2025 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Twelve Months Beginning May 1, 2022 [Member]
Senior Notes 5point 375Percent Due 2025 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Twelve Months Beginning May 1, 2023 [Member]
Senior Notes 5point 375Percent Due 2025 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Twelve Months Beginning February 1, 2020 [Member]
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Prior to May 1, 2018 [Member]
Senior Notes 5point 125Percent Due 2023 [Member]
Level 3 Financing [Member]
days
Sep. 30, 2015
Prior to May 1, 2018 [Member]
Senior Notes 5point 125Percent Due 2023 [Member]
Level 3 Financing [Member]
Maximum [Member]
Sep. 30, 2015
Prior to May 1, 2018 [Member]
Senior Notes 5point 125Percent Due 2023 [Member]
Level 3 Financing [Member]
Minimum [Member]
Sep. 30, 2015
Prior to May 1, 2018 [Member]
Senior Notes 5point 375Percent Due 2025 [Member]
Level 3 Financing [Member]
days
Sep. 30, 2015
Prior to May 1, 2018 [Member]
Senior Notes 5point 375Percent Due 2025 [Member]
Level 3 Financing [Member]
Maximum [Member]
Sep. 30, 2015
Prior to May 1, 2018 [Member]
Senior Notes 5point 375Percent Due 2025 [Member]
Level 3 Financing [Member]
Minimum [Member]
Sep. 30, 2015
Prior to February 1, 2018 [Member]
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing [Member]
Sep. 30, 2015
Prior to February 1, 2018 [Member]
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing [Member]
Maximum [Member]
Sep. 30, 2015
Prior to February 1, 2018 [Member]
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing [Member]
Minimum [Member]
Sep. 30, 2015
Prior to May 1, 2020 [Member]
Senior Notes 5point 375Percent Due 2025 [Member]
Level 3 Financing [Member]
days
Long-term debt
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Stated interest rate (as a percent)
 
 
 
 
5.125% 
 
 
 
 
5.625% 
 
4.50% 
 
 
 
 
3.50% 
4.00% 
 
 
 
 
8.875% 
 
 
 
 
 
9.375% 
 
 
 
7.00% 
 
 
5.375% 
 
 
 
 
 
8.125% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument Redemption with Net Proceeds from Equity Offerings as Percentage of Original Principal
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
40.00% 
 
 
40.00% 
 
 
40.00% 
 
 
Gains (Losses) on Extinguishment of Debt
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 27,000,000 
 
 
 
 
 
 
 
$ (18,000,000)
 
 
 
 
$ (36,000,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
$ (82,000,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Conversion, Original Debt, Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
333,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Redemption Period Notice Minimum Number of Days
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
30 
 
 
 
 
 
 
30 
 
 
30 
 
 
 
 
 
30 
Debt Instrument Redemption Period Notice Maximum Number of Days
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60 
 
 
 
 
 
 
60 
 
 
60 
 
 
 
 
 
60 
Debt Instrument Redemption Minimum Gross Proceeds from Private or Public Offering
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100,000,000 
 
 
100,000,000 
 
 
100,000,000 
 
 
 
Debt Instrument, Redemption Price, Percentage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100.00% 
 
 
 
 
 
100.00% 
 
 
100.00% 
Debt Issuance Cost
 
 
 
 
 
 
 
 
9,000,000 
 
 
 
 
16,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
25,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument Redemption Price as Percentage of Principal Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
102.8125% 
102.5625% 
101.2813% 
101.4063% 
 
100.00% 
102.6875% 
101.7917% 
101.8958% 
100.00% 
100.00% 
105.125% 
 
60.00% 
105.375% 
 
60.00% 
105.625% 
 
60.00% 
 
Total Debt Obligations
11,030,000,000 
11,366,000,000 
700,000,000 
0 
 
 
500,000,000 
0 
 
 
 
 
 
 
 
 
 
1,796,000,000 
 
0 
300,000,000 
 
 
 
775,000,000 
775,000,000 
0 
500,000,000 
 
 
0 
58,000,000 
 
800,000,000 
0 
 
 
 
0 
1,200,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2015 (remaining nine months)
10,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2016
8,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2017
7,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2018
307,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2019
822,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2020
3,479,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Thereafter
6,397,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Face Amount
 
 
 
 
 
700,000,000 
 
 
 
 
500,000,000 
 
2,000,000,000 
 
2,000,000,000 
 
 
 
815,000,000 
 
 
 
 
300,000,000 
 
 
 
 
 
500,000,000 
 
 
 
 
 
 
800,000,000 
 
 
 
 
 
1,200,000,000 
 
2,000,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Description of Variable Rate Basis
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LIBOR 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LIBOR 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Basis Spread on Variable Rate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3.50% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2.75% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0.75% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Write off of Deferred Debt Issuance Cost
 
 
 
 
 
 
 
 
 
 
 
 
 
20,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument Redemption Period Maximum Following Receipt of Proceeds from Equity Offerings
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
90 
 
 
 
 
 
 
90 
 
 
90 
 
 
 
 
 
 
Debt Conversion, Converted Instrument, Shares Issued
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
12,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Conversion of Stock, Shares Converted
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
37 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Conversion, Converted Instrument, Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 1,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Upfront basis point
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
25 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated Other Comprehensive Income (Loss) (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Dec. 31, 2013
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax
$ (275)
$ (82)
$ (147)
$ 36 
Other comprehensive income before reclassifications
(130)
(122)
 
 
Amounts reclassified from accumulated other comprehensive income
2 
4 
 
 
Accumulated Translation Adjustment [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax
(241)
(53)
(111)
67 
Other comprehensive income before reclassifications
(130)
(120)
 
 
Amounts reclassified from accumulated other comprehensive income
0 
0 
 
 
Accumulated Defined Benefit Plans Adjustment [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax
(34)
(29)
(36)
(31)
Other comprehensive income before reclassifications
0 
(2)
 
 
Amounts reclassified from accumulated other comprehensive income
$ 2 
$ 4 
 
 
Stock-Based Compensation - Non-cash compensation expense and capitalized non-cash compensation (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Non-cash compensation expense and capitalized non-cash compensation
 
 
 
 
Nonvested restricted stock and restricted stock units (RSUs)
4 
 
4 
 
OSOs outstanding
1 
 
1 
 
Stock-based compensation expense
$ 34 
$ 22 
$ 93 
$ 48 
Employee Service Share-based Compensation, Allocation of Recognized Period Costs, Capitalized Amount
0 
0 
(1)
0 
Non-cash compensation expense and capitalized non-cash compensation
34 
22 
92 
48 
Outperform Stock Options
 
 
 
 
Non-cash compensation expense and capitalized non-cash compensation
 
 
 
 
Stock-based compensation expense
1 
2 
4 
6 
Restricted Stock Units and Shares
 
 
 
 
Non-cash compensation expense and capitalized non-cash compensation
 
 
 
 
Stock-based compensation expense
15 
10 
37 
22 
Performance Restricted Stock Units [Member]
 
 
 
 
Non-cash compensation expense and capitalized non-cash compensation
 
 
 
 
Stock-based compensation expense
10 
4 
23 
7 
401(k) Match Expense
 
 
 
 
Non-cash compensation expense and capitalized non-cash compensation
 
 
 
 
Stock-based compensation expense
8 
6 
29 
18 
Restricted Stock Unit Bonus Grant
 
 
 
 
Non-cash compensation expense and capitalized non-cash compensation
 
 
 
 
Stock-based compensation expense
$ 0 
$ 0 
$ 0 
$ (5)
Segment Information (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Assets
$ 20,883 
 
$ 20,883 
 
$ 20,947 
Payments to Acquire Productive Assets
328 
204 
899 
608 
 
Adjusted EBITDA by Segment
657 
471 
1,957 
1,388 
 
Revenue
2,062 
1,629 
6,176 
4,863 
 
Income Tax Expense
(16)
(8)
(39)
(27)
 
Other Expenses
(310)
(169)
(844)
(507)
 
Depreciation, Depletion and Amortization
(296)
(187)
(872)
(558)
 
Share-based Compensation
(34)
(22)
(92)
(48)
 
Net Income (Loss) Available to Common Stockholders, Basic
1 
85 
110 
248 
 
Corporate and Other [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Assets
262 
 
262 
 
284 
Payments to Acquire Productive Assets
37 
19 
103 
102 
 
Adjusted EBITDA by Segment
(244)
(170)
(723)
(503)
 
North America [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Assets
16,615 
 
16,615 
 
16,242 
Payments to Acquire Productive Assets
202 
116 
560 
318 
 
Adjusted EBITDA by Segment
760 
492 
2,267 
1,460 
 
Europe [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Assets
1,859 
 
1,859 
 
1,970 
Payments to Acquire Productive Assets
41 
34 
114 
82 
 
Adjusted EBITDA by Segment
63 
57 
176 
167 
 
Latin America [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Assets
2,147 
 
2,147 
 
2,451 
Payments to Acquire Productive Assets
48 
35 
122 
106 
 
Adjusted EBITDA by Segment
78 
92 
237 
264 
 
Core Network Service [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Revenue
1,946 
1,482 
5,814 
4,418 
 
Core Network Service [Member] |
North America [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Revenue
1,551 
1,063 
4,637 
3,157 
 
Core Network Service [Member] |
Europe [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Revenue
212 
219 
623 
673 
 
Core Network Service [Member] |
Latin America [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Revenue
183 
200 
554 
588 
 
Wholesale Voice Services and Other [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Revenue
116 
147 
362 
445 
 
Wholesale Voice Services and Other [Member] |
North America [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Revenue
110 
128 
343 
410 
 
Wholesale Voice Services and Other [Member] |
Europe [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Revenue
3 
4 
10 
14 
 
Wholesale Voice Services and Other [Member] |
Latin America [Member]
 
 
 
 
 
Segment Reporting, Revenue Reconciling Item [Line Items]
 
 
 
 
 
Revenue
$ 3 
$ 15 
$ 9 
$ 21 
 
Commitments, Contingencies and Other Items - Lawsuits (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Sep. 30, 2015
Sep. 30, 2015
Peruvian Tax Litigation
Pending Litigation
Sep. 30, 2015
Peruvian Tax Litigation, Before Interest
Pending Litigation
Sep. 30, 2015
Peruvian Tax Litigation, Income Tax witholding 2001 and 2002
Pending Litigation
Sep. 30, 2015
Peruvian Tax Litigation, VAT for 2001 and 2002
Pending Litigation
Sep. 30, 2015
Peruvian Tax Litigation, Disallowance of VAT in 2005
Pending Litigation
Sep. 30, 2015
Employee Severance and Contractor Termination Disputes
Pending Litigation
Sep. 30, 2015
up to
Brazilian Tax Claims
Pending Litigation
Dec. 31, 2014
Brazilian Tax Reserve Release [Member]
Brazilian Tax Claims
Pending Litigation
Sep. 30, 2014
Brazilian Tax Reserve Release [Member]
Brazilian Tax Claims
Pending Litigation
Loss Contingencies
 
 
 
 
 
 
 
 
 
 
Estimated Litigation Liability
$ 136 
 
 
 
 
 
 
 
 
 
Loss Contingency, Asserted Claim
 
49 
26 
3 
7 
16 
44 
 
 
 
Loss Contingency Accrual, Period Increase (Decrease)
 
 
 
 
 
 
 
 
3 
6 
Loss Contingency Accrual, Payments
 
 
 
 
 
 
 
 
5 
 
Loss Contingency, Range of Possible Loss, Portion Not Accrued
 
 
 
 
 
 
 
$ 39 
 
 
Commitments, Contingencies and Other Items - Other Commitments (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Commitments and Contingencies Disclosure [Abstract]
 
 
Amount outstanding under letters of credit or other similar obligations
$ 46 
$ 28 
Collateralized by cash, that is reflected on the consolidated balance sheets as restricted cash
$ 43 
$ 23 
Condensed Consolidating Financial Information - Statements of Comprehensive Income (Loss) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Condensed Consolidating Financial Information
 
 
 
 
Revenue
$ 2,062 
$ 1,629 
$ 6,176 
$ 4,863 
Costs and Expenses:
 
 
 
 
Network Access Costs
706 
607 
2,125 
1,834 
Network Related Expenses
369 
307 
1,088 
901 
Depreciation and Amortization
296 
187 
872 
558 
Selling, General and Administrative Expenses
364 
266 
1,098 
788 
Total Costs and Expenses
1,735 
1,367 
5,183 
4,081 
Operating Income (Loss)
327 
262 
993 
782 
Other Income (Expense):
 
 
 
 
Interest Income
0 
1 
1 
1 
Interest expense
(145)
(159)
(490)
(459)
Interest income (expense) affiliates, net
0 
0 
0 
0 
Equity in net earnings (losses) of subsidiaries
0 
0 
0 
0 
Other, net
(165)
(11)
(355)
(49)
Total Other Expense
(310)
(169)
(844)
(507)
Income (Loss) before Income Taxes
17 
93 
149 
275 
Income Tax Expense
(16)
(8)
(39)
(27)
Net Income (Loss)
1 
85 
110 
248 
Other Comprehensive Income (Loss), Net of Income Taxes
(72)
(137)
(128)
(118)
Comprehensive Income (Loss)
(71)
(52)
(18)
130 
Level 3 Communications, Inc.
 
 
 
 
Condensed Consolidating Financial Information
 
 
 
 
Revenue
0 
0 
0 
0 
Costs and Expenses:
 
 
 
 
Network Access Costs
0 
0 
0 
0 
Network Related Expenses
0 
0 
0 
0 
Depreciation and Amortization
0 
0 
0 
0 
Selling, General and Administrative Expenses
1 
6 
3 
7 
Total Costs and Expenses
1 
6 
3 
7 
Operating Income (Loss)
(1)
(6)
(3)
(7)
Other Income (Expense):
 
 
 
 
Interest Income
 
0 
0 
0 
Interest expense
(9)
(34)
(42)
(102)
Interest income (expense) affiliates, net
320 
314 
984 
905 
Equity in net earnings (losses) of subsidiaries
(309)
(189)
(811)
(548)
Other, net
0 
0 
(18)
0 
Total Other Expense
2 
91 
113 
255 
Income (Loss) before Income Taxes
1 
85 
110 
248 
Income Tax Expense
0 
0 
0 
0 
Net Income (Loss)
1 
85 
110 
248 
Other Comprehensive Income (Loss), Net of Income Taxes
(72)
(137)
(128)
(118)
Comprehensive Income (Loss)
(71)
(52)
(18)
130 
Level 3 Financing, Inc.
 
 
 
 
Condensed Consolidating Financial Information
 
 
 
 
Revenue
0 
0 
0 
0 
Costs and Expenses:
 
 
 
 
Network Access Costs
0 
0 
0 
0 
Network Related Expenses
0 
0 
0 
0 
Depreciation and Amortization
0 
0 
0 
0 
Selling, General and Administrative Expenses
0 
0 
0 
1 
Total Costs and Expenses
0 
0 
0 
1 
Operating Income (Loss)
0 
0 
0 
(1)
Other Income (Expense):
 
 
 
 
Interest Income
 
0 
0 
0 
Interest expense
(135)
(112)
(436)
(337)
Interest income (expense) affiliates, net
498 
452 
1,495 
1,370 
Equity in net earnings (losses) of subsidiaries
(671)
(528)
(1,723)
(1,577)
Other, net
0 
0 
(145)
0 
Total Other Expense
(308)
(188)
(809)
(544)
Income (Loss) before Income Taxes
(308)
(188)
(809)
(545)
Income Tax Expense
(1)
(1)
(2)
(3)
Net Income (Loss)
(309)
(189)
(811)
(548)
Other Comprehensive Income (Loss), Net of Income Taxes
0 
0 
0 
0 
Comprehensive Income (Loss)
(309)
(189)
(811)
(548)
Level 3 Communications, LLC
 
 
 
 
Condensed Consolidating Financial Information
 
 
 
 
Revenue
830 
781 
2,478 
2,278 
Costs and Expenses:
 
 
 
 
Network Access Costs
300 
291 
919 
869 
Network Related Expenses
252 
195 
713 
567 
Depreciation and Amortization
78 
70 
227 
209 
Selling, General and Administrative Expenses
274 
181 
789 
505 
Total Costs and Expenses
904 
737 
2,648 
2,150 
Operating Income (Loss)
(74)
44 
(170)
128 
Other Income (Expense):
 
 
 
 
Interest Income
 
0 
0 
0 
Interest expense
0 
(1)
(2)
(1)
Interest income (expense) affiliates, net
(763)
(730)
(2,298)
(2,169)
Equity in net earnings (losses) of subsidiaries
0 
162 
177 
502 
Other, net
3 
2 
2 
6 
Total Other Expense
(760)
(567)
(2,121)
(1,662)
Income (Loss) before Income Taxes
(834)
(523)
(2,291)
(1,534)
Income Tax Expense
0 
0 
0 
(1)
Net Income (Loss)
(834)
(523)
(2,291)
(1,535)
Other Comprehensive Income (Loss), Net of Income Taxes
0 
0 
0 
0 
Comprehensive Income (Loss)
(834)
(523)
(2,291)
(1,535)
Other Non-Guarantor Subsidiaries
 
 
 
 
Condensed Consolidating Financial Information
 
 
 
 
Revenue
1,271 
901 
3,834 
2,750 
Costs and Expenses:
 
 
 
 
Network Access Costs
445 
369 
1,342 
1,130 
Network Related Expenses
117 
112 
375 
334 
Depreciation and Amortization
218 
117 
645 
349 
Selling, General and Administrative Expenses
89 
79 
306 
275 
Total Costs and Expenses
869 
677 
2,668 
2,088 
Operating Income (Loss)
402 
224 
1,166 
662 
Other Income (Expense):
 
 
 
 
Interest Income
 
1 
1 
1 
Interest expense
(1)
(12)
(10)
(19)
Interest income (expense) affiliates, net
(55)
(36)
(181)
(106)
Equity in net earnings (losses) of subsidiaries
0 
0 
0 
0 
Other, net
(168)
(13)
(194)
(55)
Total Other Expense
(224)
(60)
(384)
(179)
Income (Loss) before Income Taxes
178 
164 
782 
483 
Income Tax Expense
(15)
(7)
(37)
(23)
Net Income (Loss)
163 
157 
745 
460 
Other Comprehensive Income (Loss), Net of Income Taxes
72 
(137)
128 
(118)
Comprehensive Income (Loss)
235 
20 
873 
342 
Eliminations
 
 
 
 
Condensed Consolidating Financial Information
 
 
 
 
Revenue
(39)
(53)
(136)
(165)
Costs and Expenses:
 
 
 
 
Network Access Costs
(39)
(53)
(136)
(165)
Network Related Expenses
0 
0 
0 
0 
Depreciation and Amortization
0 
0 
0 
0 
Selling, General and Administrative Expenses
0 
0 
0 
0 
Total Costs and Expenses
(39)
(53)
(136)
(165)
Operating Income (Loss)
0 
0 
0 
0 
Other Income (Expense):
 
 
 
 
Interest Income
 
0 
0 
0 
Interest expense
0 
0 
0 
0 
Interest income (expense) affiliates, net
0 
0 
0 
0 
Equity in net earnings (losses) of subsidiaries
980 
555 
2,357 
1,623 
Other, net
0 
0 
0 
0 
Total Other Expense
980 
555 
2,357 
1,623 
Income (Loss) before Income Taxes
980 
555 
2,357 
1,623 
Income Tax Expense
0 
0 
0 
0 
Net Income (Loss)
980 
555 
2,357 
1,623 
Other Comprehensive Income (Loss), Net of Income Taxes
(72)
137 
(128)
118 
Comprehensive Income (Loss)
$ 908 
$ 692 
$ 2,229 
$ 1,741 
Condensed Consolidating Financial Information - Balance Sheets (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
Dec. 31, 2013
Current Assets:
 
 
 
 
Cash and cash equivalents
$ 691 
$ 580 
$ 729 
$ 631 
Restricted cash and securities
7 
7 
 
 
Receivables, less allowances for doubtful accounts
810 
737 
 
 
Due from affiliates
0 
0 
 
 
Other
155 
165 
 
 
Total Current Assets
1,663 
1,489 
 
 
Property, Plant and Equipment, net
9,812 
9,860 
 
 
Restricted Cash and Securities
44 
20 
 
 
Goodwill and Other Intangibles Assets, net
8,935 
9,103 
 
 
Investment in Subsidiaries
0 
0 
 
 
Other Assets, net
429 
475 
 
 
Total Assets
20,883 
20,947 
 
 
Liabilities and Stockholders' Equity:
 
 
 
 
Accounts payable
630 
664 
 
 
Current portion of long-term debt
16 
349 
 
 
Accrued payroll and employee benefits
230 
273 
 
 
Accrued interest
137 
174 
 
 
Current portion of deferred revenue
273 
287 
 
 
Due to affiliates
0 
0 
 
 
Other
184 
167 
 
 
Total Current Liabilities
1,470 
1,914 
 
 
Long-Term Debt, less current portion
10,997 
10,984 
 
 
Deferred Revenue, less current portion
942 
921 
 
 
Other Liabilities
694 
765 
 
 
Commitments and Contingencies
   
   
 
 
Stockholders' Equity (Deficit)
6,780 
6,363 
 
 
Total Liabilities and Stockholders’ Equity (Deficit)
20,883 
20,947 
 
 
Level 3 Communications, Inc.
 
 
 
 
Current Assets:
 
 
 
 
Cash and cash equivalents
13 
7 
7 
8 
Restricted cash and securities
0 
0 
 
 
Receivables, less allowances for doubtful accounts
0 
0 
 
 
Due from affiliates
15,304 
14,522 
 
 
Other
1 
2 
 
 
Total Current Assets
15,318 
14,531 
 
 
Property, Plant and Equipment, net
0 
0 
 
 
Restricted Cash and Securities
27 
3 
 
 
Goodwill and Other Intangibles Assets, net
0 
0 
 
 
Investment in Subsidiaries
16,737 
16,686 
 
 
Other Assets, net
20 
28 
 
 
Total Assets
32,102 
31,248 
 
 
Liabilities and Stockholders' Equity:
 
 
 
 
Accounts payable
0 
0 
 
 
Current portion of long-term debt
0 
333 
 
 
Accrued payroll and employee benefits
0 
0 
 
 
Accrued interest
3 
12 
 
 
Current portion of deferred revenue
0 
0 
 
 
Due to affiliates
0 
0 
 
 
Other
0 
0 
 
 
Total Current Liabilities
3 
345 
 
 
Long-Term Debt, less current portion
600 
900 
 
 
Deferred Revenue, less current portion
0 
0 
 
 
Other Liabilities
15 
16 
 
 
Commitments and Contingencies
   
   
 
 
Stockholders' Equity (Deficit)
31,484 
29,987 
 
 
Total Liabilities and Stockholders’ Equity (Deficit)
32,102 
31,248 
 
 
Level 3 Financing, Inc.
 
 
 
 
Current Assets:
 
 
 
 
Cash and cash equivalents
6 
5 
5 
6 
Restricted cash and securities
0 
0 
 
 
Receivables, less allowances for doubtful accounts
0 
0 
 
 
Due from affiliates
22,482 
21,270 
 
 
Other
19 
21 
 
 
Total Current Assets
22,507 
21,296 
 
 
Property, Plant and Equipment, net
0 
0 
 
 
Restricted Cash and Securities
0 
0 
 
 
Goodwill and Other Intangibles Assets, net
0 
0 
 
 
Investment in Subsidiaries
14,542 
14,777 
 
 
Other Assets, net
119 
129 
 
 
Total Assets
37,168 
36,202 
 
 
Liabilities and Stockholders' Equity:
 
 
 
 
Accounts payable
1 
0 
 
 
Current portion of long-term debt
0 
0 
 
 
Accrued payroll and employee benefits
0 
0 
 
 
Accrued interest
128 
158 
 
 
Current portion of deferred revenue
0 
0 
 
 
Due to affiliates
0 
0 
 
 
Other
0 
2 
 
 
Total Current Liabilities
129 
160 
 
 
Long-Term Debt, less current portion
10,209 
9,893 
 
 
Deferred Revenue, less current portion
0 
0 
 
 
Other Liabilities
27 
24 
 
 
Commitments and Contingencies
   
   
 
 
Stockholders' Equity (Deficit)
26,803 
26,125 
 
 
Total Liabilities and Stockholders’ Equity (Deficit)
37,168 
36,202 
 
 
Level 3 Communications, LLC
 
 
 
 
Current Assets:
 
 
 
 
Cash and cash equivalents
559 
307 
524 
347 
Restricted cash and securities
1 
1 
 
 
Receivables, less allowances for doubtful accounts
68 
34 
 
 
Due from affiliates
0 
0 
 
 
Other
67 
45 
 
 
Total Current Assets
695 
387 
 
 
Property, Plant and Equipment, net
3,320 
3,152 
 
 
Restricted Cash and Securities
15 
16 
 
 
Goodwill and Other Intangibles Assets, net
365 
373 
 
 
Investment in Subsidiaries
3,737 
3,729 
 
 
Other Assets, net
11 
9 
 
 
Total Assets
8,143 
7,666 
 
 
Liabilities and Stockholders' Equity:
 
 
 
 
Accounts payable
194 
215 
 
 
Current portion of long-term debt
3 
3 
 
 
Accrued payroll and employee benefits
198 
174 
 
 
Accrued interest
0 
0 
 
 
Current portion of deferred revenue
113 
118 
 
 
Due to affiliates
36,981 
34,401 
 
 
Other
94 
62 
 
 
Total Current Liabilities
37,583 
34,973 
 
 
Long-Term Debt, less current portion
15 
16 
 
 
Deferred Revenue, less current portion
648 
617 
 
 
Other Liabilities
132 
125 
 
 
Commitments and Contingencies
   
   
 
 
Stockholders' Equity (Deficit)
(30,235)
(28,065)
 
 
Total Liabilities and Stockholders’ Equity (Deficit)
8,143 
7,666 
 
 
Other Non-Guarantor Subsidiaries
 
 
 
 
Current Assets:
 
 
 
 
Cash and cash equivalents
113 
261 
193 
270 
Restricted cash and securities
6 
6 
 
 
Receivables, less allowances for doubtful accounts
742 
703 
 
 
Due from affiliates
0 
0 
 
 
Other
68 
97 
 
 
Total Current Assets
929 
1,067 
 
 
Property, Plant and Equipment, net
6,492 
6,708 
 
 
Restricted Cash and Securities
2 
1 
 
 
Goodwill and Other Intangibles Assets, net
8,570 
8,730 
 
 
Investment in Subsidiaries
0 
0 
 
 
Other Assets, net
279 
309 
 
 
Total Assets
16,272 
16,815 
 
 
Liabilities and Stockholders' Equity:
 
 
 
 
Accounts payable
435 
449 
 
 
Current portion of long-term debt
13 
13 
 
 
Accrued payroll and employee benefits
32 
99 
 
 
Accrued interest
6 
4 
 
 
Current portion of deferred revenue
160 
169 
 
 
Due to affiliates
805 
1,391 
 
 
Other
90 
103 
 
 
Total Current Liabilities
1,541 
2,228 
 
 
Long-Term Debt, less current portion
173 
175 
 
 
Deferred Revenue, less current portion
294 
304 
 
 
Other Liabilities
520 
600 
 
 
Commitments and Contingencies
   
   
 
 
Stockholders' Equity (Deficit)
13,744 
13,508 
 
 
Total Liabilities and Stockholders’ Equity (Deficit)
16,272 
16,815 
 
 
Eliminations
 
 
 
 
Current Assets:
 
 
 
 
Cash and cash equivalents
0 
0 
0 
0 
Restricted cash and securities
0 
0 
 
 
Receivables, less allowances for doubtful accounts
0 
0 
 
 
Due from affiliates
(37,786)
(35,792)
 
 
Other
0 
0 
 
 
Total Current Assets
(37,786)
(35,792)
 
 
Property, Plant and Equipment, net
0 
0 
 
 
Restricted Cash and Securities
0 
0 
 
 
Goodwill and Other Intangibles Assets, net
0 
0 
 
 
Investment in Subsidiaries
(35,016)
(35,192)
 
 
Other Assets, net
0 
0 
 
 
Total Assets
(72,802)
(70,984)
 
 
Liabilities and Stockholders' Equity:
 
 
 
 
Accounts payable
0 
0 
 
 
Current portion of long-term debt
0 
0 
 
 
Accrued payroll and employee benefits
0 
0 
 
 
Accrued interest
0 
0 
 
 
Current portion of deferred revenue
0 
0 
 
 
Due to affiliates
(37,786)
(35,792)
 
 
Other
0 
0 
 
 
Total Current Liabilities
(37,786)
(35,792)
 
 
Long-Term Debt, less current portion
0 
0 
 
 
Deferred Revenue, less current portion
0 
0 
 
 
Other Liabilities
0 
0 
 
 
Commitments and Contingencies
   
   
 
 
Stockholders' Equity (Deficit)
(35,016)
(35,192)
 
 
Total Liabilities and Stockholders’ Equity (Deficit)
$ (72,802)
$ (70,984)
 
 
Condensed Consolidating Financial Information - Statements of Cash Flows (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Condensed Consolidating Financial Information
 
 
Net Cash Provided by (Used in) Operating Activities
$ 1,299 
$ 765 
Cash Flows from Investing Activities:
 
 
Capital expenditures
(899)
(608)
Cash related to deconsolidated Venezuela operations
(83)
0 
(Increase) decrease in restricted cash and securities, net
(24)
(10)
Proceeds from sale of property, plant, and equipment and other assets
3 
3 
Other
14 
2 
Net Cash Used in Investing Activities
(1,017)
(617)
Cash Flows from Financing Activities:
 
 
Long-term debt borrowings, net of issuance costs
3,947 
(1)
Payments on and repurchases of long-term debt, including current portions and refinancing costs
(4,102)
(8)
Increase (decrease) due from-to affiliates, net
0 
0 
Net Cash Provided by (Used in) Financing Activities
(155)
(9)
Effect of Exchange Rates on Cash and Cash Equivalents
(16)
(41)
Net Change in Cash and Cash Equivalents
111 
98 
Cash and Cash Equivalents at Beginning of Period
580 
631 
Cash and Cash Equivalents at End of Period
691 
729 
Level 3 Communications, Inc.
 
 
Condensed Consolidating Financial Information
 
 
Net Cash Provided by (Used in) Operating Activities
(39)
(91)
Cash Flows from Investing Activities:
 
 
Capital expenditures
0 
0 
Cash related to deconsolidated Venezuela operations
0 
 
(Increase) decrease in restricted cash and securities, net
(25)
0 
Proceeds from sale of property, plant, and equipment and other assets
0 
0 
Other
0 
0 
Net Cash Used in Investing Activities
(25)
0 
Cash Flows from Financing Activities:
 
 
Long-term debt borrowings, net of issuance costs
0 
0 
Payments on and repurchases of long-term debt, including current portions and refinancing costs
(313)
0 
Increase (decrease) due from-to affiliates, net
383 
90 
Net Cash Provided by (Used in) Financing Activities
70 
90 
Effect of Exchange Rates on Cash and Cash Equivalents
0 
0 
Net Change in Cash and Cash Equivalents
6 
(1)
Cash and Cash Equivalents at Beginning of Period
7 
8 
Cash and Cash Equivalents at End of Period
13 
7 
Level 3 Financing, Inc.
 
 
Condensed Consolidating Financial Information
 
 
Net Cash Provided by (Used in) Operating Activities
(447)
(336)
Cash Flows from Investing Activities:
 
 
Capital expenditures
0 
0 
Cash related to deconsolidated Venezuela operations
0 
 
(Increase) decrease in restricted cash and securities, net
0 
0 
Proceeds from sale of property, plant, and equipment and other assets
0 
0 
Other
0 
0 
Net Cash Used in Investing Activities
0 
0 
Cash Flows from Financing Activities:
 
 
Long-term debt borrowings, net of issuance costs
3,947 
0 
Payments on and repurchases of long-term debt, including current portions and refinancing costs
(3,780)
0 
Increase (decrease) due from-to affiliates, net
281 
335 
Net Cash Provided by (Used in) Financing Activities
448 
335 
Effect of Exchange Rates on Cash and Cash Equivalents
0 
0 
Net Change in Cash and Cash Equivalents
1 
(1)
Cash and Cash Equivalents at Beginning of Period
5 
6 
Cash and Cash Equivalents at End of Period
6 
5 
Level 3 Communications, LLC
 
 
Condensed Consolidating Financial Information
 
 
Net Cash Provided by (Used in) Operating Activities
57 
443 
Cash Flows from Investing Activities:
 
 
Capital expenditures
(307)
(261)
Cash related to deconsolidated Venezuela operations
0 
 
(Increase) decrease in restricted cash and securities, net
1 
1 
Proceeds from sale of property, plant, and equipment and other assets
0 
0 
Other
14 
0 
Net Cash Used in Investing Activities
(320)
(260)
Cash Flows from Financing Activities:
 
 
Long-term debt borrowings, net of issuance costs
0 
0 
Payments on and repurchases of long-term debt, including current portions and refinancing costs
(1)
0 
Increase (decrease) due from-to affiliates, net
516 
(6)
Net Cash Provided by (Used in) Financing Activities
515 
(6)
Effect of Exchange Rates on Cash and Cash Equivalents
0 
0 
Net Change in Cash and Cash Equivalents
252 
177 
Cash and Cash Equivalents at Beginning of Period
307 
347 
Cash and Cash Equivalents at End of Period
559 
524 
Other Non-Guarantor Subsidiaries
 
 
Condensed Consolidating Financial Information
 
 
Net Cash Provided by (Used in) Operating Activities
1,728 
749 
Cash Flows from Investing Activities:
 
 
Capital expenditures
(592)
(347)
Cash related to deconsolidated Venezuela operations
(83)
 
(Increase) decrease in restricted cash and securities, net
0 
(11)
Proceeds from sale of property, plant, and equipment and other assets
3 
3 
Other
0 
2 
Net Cash Used in Investing Activities
(672)
(357)
Cash Flows from Financing Activities:
 
 
Long-term debt borrowings, net of issuance costs
0 
(1)
Payments on and repurchases of long-term debt, including current portions and refinancing costs
(8)
(8)
Increase (decrease) due from-to affiliates, net
(1,180)
(419)
Net Cash Provided by (Used in) Financing Activities
(1,188)
(428)
Effect of Exchange Rates on Cash and Cash Equivalents
(16)
(41)
Net Change in Cash and Cash Equivalents
(148)
(77)
Cash and Cash Equivalents at Beginning of Period
261 
270 
Cash and Cash Equivalents at End of Period
113 
193 
Eliminations
 
 
Condensed Consolidating Financial Information
 
 
Net Cash Provided by (Used in) Operating Activities
0 
0 
Cash Flows from Investing Activities:
 
 
Capital expenditures
0 
0 
(Increase) decrease in restricted cash and securities, net
0 
0 
Proceeds from sale of property, plant, and equipment and other assets
0 
0 
Other
0 
0 
Net Cash Used in Investing Activities
0 
0 
Cash Flows from Financing Activities:
 
 
Long-term debt borrowings, net of issuance costs
0 
0 
Payments on and repurchases of long-term debt, including current portions and refinancing costs
0 
0 
Increase (decrease) due from-to affiliates, net
0 
0 
Net Cash Provided by (Used in) Financing Activities
0 
0 
Effect of Exchange Rates on Cash and Cash Equivalents
0 
0 
Net Change in Cash and Cash Equivalents
0 
0 
Cash and Cash Equivalents at Beginning of Period
0 
0 
Cash and Cash Equivalents at End of Period
$ 0 
$ 0 
Subsequent Events (Details) (Level 3 Financing [Member], Subsequent Event [Member], USD $)
In Millions, unless otherwise specified
3 Months Ended
Dec. 31, 2015
Oct. 29, 2015
Senior Notes 5.375 Percent Due 2024 [Member]
 
 
Subsequent Event [Line Items]
 
 
Debt Instrument, Face Amount
 
$ 900 
Debt Instrument, Interest Rate, Stated Percentage
 
5.375% 
8.625% Senior Notes due 2020
 
 
Subsequent Event [Line Items]
 
 
Debt Instrument, Face Amount
 
900 
Debt Instrument, Interest Rate, Stated Percentage
 
8.625% 
Gains (Losses) on Extinguishment of Debt
$ 55