AT&T Continues Restructuring and Cost Reduction Efforts

AT&T (NYSE: T) today announced a series of restructuring actions as the company continues its transformation in the rapidly changing communications industry.

The company said that the previously announced review of its assets will result in an asset impairment charge in the third quarter of 2004.  The asset impairment results from sustained pricing pressure and the evolution of services toward newer technologies in the business market as well as changes in the regulatory environment, which led to a shift away from traditional consumer services.  As a result, AT&T will take a non-cash charge of approximately $11.4 billion in the third quarter of 2004 to recognize the asset impairment.  This action will reduce AT&T's depreciation expense by approximately $1.0 billion in the second half of 2004.