OVERLAND PARK, Kan., April 25, 2007 /PRNewswire-FirstCall via COMTEX News Network/ -- EMBARQ (NYSE: EQ) today announced results for the first quarter of 2007. The company reported net operating revenues of $1.59 billion, operating income of $371 million and diluted earnings per share of $1.05. EMBARQ's first quarter operating income and earnings per share results were negatively impacted by, among other items, $17 million of early stage dilution associated with the company's wireless business, a $14 million employee severance charge, $9 million of expenses related to the company's spin-off, and $9 million in depreciation.

EMBARQ's access line results improved in the first quarter, as the company lost 15,000 fewer lines to competitors than in the same period a year ago. In addition, high-speed Internet subscriber additions reached a company record of 87,000 this quarter.

"Prior to the fourth quarter of 2006, it had been years since we had seen improvement in access line erosion, so it's significant that we have been able to accomplish this two quarters in a row," said Dan Hesse, EMBARQ Chairman and Chief Executive Officer. "With an improving access line trend and strong growth in data, high-speed Internet and wireless revenues, we're off to a great start in 2007."

    Highlights

    --  Reported solid revenue, earnings and cash flow results
    --  For the second consecutive quarter, lost fewer access lines to
        competitors than in the prior year quarter
    --  Accelerated growth in high-capacity business data revenue and
        maintained solid wholesale data revenue growth
    --  Added 87,000 high-speed Internet subscribers -- a new company record
    --  Launched an EMBARQ-branded portal offering several enhancements for
        high-speed Internet subscribers
    --  Declared a dividend of $0.625 per share for the second quarter, an
        increase from $0.50 per share in the first quarter
    --  Reaffirmed its outlook for 2007


GAAP and 'As Adjusted' Reporting

EMBARQ's reported results under generally accepted accounting principles (GAAP) for periods prior to its May 2006 spin-off from Sprint Nextel do not reflect certain items that are included in its GAAP reporting for periods subsequent to the spin-off. (These items are described in more detail in the section titled "Financial Measures.") Accordingly, the company's pre spin-off GAAP results are not fully comparable to its post spin-off GAAP results.

The company's as adjusted basis of reporting reflects the current composition of its business for all periods prior and subsequent to its spin- off. Thus, as adjusted results are provided to help investors evaluate trends in the company's operating performance.

Reconciliations between EMBARQ's GAAP and as adjusted results are provided in Schedules 5 and 6.

Operating Results

EMBARQ reported total net operating revenues of $1.59 billion for the first quarter of 2007. Compared to first quarter 2006 GAAP results, this represents an increase of 1.8%.

Compared to first quarter 2006 as adjusted results, total revenue declined 4.6%. A majority of the as adjusted decline was attributable to the company's Logistics segment, in which revenues declined 28.3% year-over-year due in part to actions previously taken to improve the profitability of this segment. In the Telecommunications segment, as adjusted revenue declined 2.2% on a year- over-year basis. Within the Telecommunications segment, access line losses drove a decline in voice revenue, which was partially offset by strong growth in data, high-speed Internet and wireless revenues.

EMBARQ reported operating income of $371 million for the first quarter of 2007. Compared to first quarter 2006 GAAP results, this represents an increase of 1.4%.

Compared to first quarter 2006 as adjusted results, operating income declined 9.3%, due largely to the year-over-year decline in revenue. Also contributing to the decline in operating income was early life stage dilution associated with the company's wireless business, which was offset by year- over-year improvement in other areas.

Capital Expenditures and Cash Flow

EMBARQ reported capital expenditures of $183 million for the first quarter of 2007. This amount includes $4 million of separation-related capital spending.

Driven by its solid operating performance, EMBARQ generated free cash flow of $317 million in the first quarter. The company's strong cash flow enabled a net debt reduction of $356 million.

Second Quarter Dividend

EMBARQ announced that its Board of Directors has declared a dividend on its common stock. A dividend of $0.625 per share is payable June 30, 2007 to stockholders of record at the close of business on June 8, 2007. This second quarter dividend represents a 25% increase from the first quarter dividend of $0.50 per share.

Subscriber Results

EMBARQ lost 71,000 access lines in the first quarter of 2007, which includes a 7,000 line increase associated with a large business customer win. The decline of 71,000 lines is an improvement of 15,000 lines from a year ago when the company lost 86,000 lines to competitors and sold 5,000 lines. On a year-over-year basis, the company's access lines declined by 5.9%.

The company set a record for high-speed Internet (HSI) subscriber additions in the first quarter with 87,000. At the end of the quarter, EMBARQ had more than 1.1 million HSI subscribers.

The company continued to grow its wireless business, adding 23,000 new subscribers in the quarter. At quarter end, its wireless subscriber base totaled 71,000.

2007 Outlook

EMBARQ reiterated the outlook for 2007 it provided on February 8, 2007. Specific expectations for the year are as follows:

    --  Access lines are expected to decline at a mid to upper 6% rate.
    --  Telecommunications segment revenues are expected to be $5.77 billion
        to $5.87 billion.
    --  Consolidated operating income is expected to be $1.45 billion to $1.55
        billion, including approximately $20 million of non-recurring
        separation-related expenses, $50 to $60 million of early-stage
        dilution associated with the company's wireless business, and
        depreciation of approximately $1.05 billion.
    --  Consolidated capital expenditures are expected to be $870 million to
        $890 million, including approximately $30 million of non-recurring
        separation-related capital spending.

Conference Call

On Wednesday, April 25, 2007, EMBARQ will hold a conference call beginning at 4:30 PM EDT. Dial-in numbers for the conference call are (866) 245-2310 (U.S. and Canada) and (706) 679-0843 (International). The code required to access the call is 3836912. Please plan to dial-in at least five minutes before the scheduled start time. A simultaneous audio webcast of the call and a downloadable presentation will be available at http://www.embarq.com/investors .

For those unable to participate live, a replay of the call will be available until May 11th, 2007 by dialing (800) 642-1687 (U.S. and Canada) or (706) 645-9291 (International) and at http://www.embarq.com/investors . The accompanying presentation will also be archived and available for download at this Web site.

Cautionary Statement

This news release contains "forward-looking statements" within the meaning of the securities laws, including statements relating to EMBARQ's outlook or expectations for earnings, revenues, expenses, depreciation and amortization, asset quality, access line declines, customer growth, or other future financial or business performance, strategies or expectations. The words "estimate," "plan," "project," "forecast," "expect," "intend," "anticipate," "believe," "seek," "target," "guidance," "outlook" and similar expressions are intended to identify forward-looking statements. These statements reflect management's judgment based on currently available information and involve a number of risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. With respect to these forward-looking statements, management has made assumptions regarding, among other things, customer and network usage, customer retention, pricing, operating costs, technology, and the economic and regulatory environment. Future performance cannot be ensured. Actual results may differ materially from those in the forward-looking statements. Some factors that could cause actual results to differ include: economic, competitive, regulatory, technological, capital market and other factors, and the risks that are described in the sections entitled "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Statements" contained in EMBARQ's Annual Report on Form 10-K, as filed with the Securities and Exchange Commission (SEC) and in EMBARQ's other filings with the SEC.

Forward-looking statements speak only as of the date they were made, and EMBARQ undertakes no obligation to update or revise any forward-looking statements in light of new information or future events. You should not place undue reliance on any forward-looking statements, which speak only as of the date of this presentation. EMBARQ is not obligated to publicly update or release any revisions to these forward-looking statements to reflect any events or circumstances after the date of this presentation.

                          Embarq Corporation Consolidated
                         Selected Unaudited Financial Data
                     ($ in millions, except per share amounts)


                                    1Q-06                1Q-06 As
      Consolidated          1Q-07   GAAP     Fav/(Unfav) Adjusted  Fav/(Unfav)
          Voice             $1,084  $1,044   $40    3.8%  $1,161   (77)  -6.6%
          Data                 189     169    20   11.8%     175    14    8.0%
          High-speed
           Internet            116      92    24   26.1%      92    24   26.1%
          Wireless               9       -     9     N/A       -     9     N/A
          Other services        60      81   (21) -25.9%      66    (6)  -9.1%
        Service revenues     1,458   1,386    72    5.2%   1,494   (36)  -2.4%
          EMBARQ Logistics     109     152   (43) -28.3%     152   (43) -28.3%
          Other product         22      23    (1)  -4.3%      20     2   10.0%
        Product revenues       131     175   (44) -25.1%     172   (41) -23.8%
      Net Operating
       Revenues              1,589   1,561    28    1.8%   1,666   (77)  -4.6%

      Operating Expenses
        Cost of services       417     378   (39) -10.3%     429    12    2.8%
        Cost of products       127     160    33   20.6%     157    30   19.1%
        Selling, general
         and administrative    404     419    15    3.6%     408     4    1.0%
        Depreciation           270     238   (32) -13.4%     263    (7)  -2.7%
      Total Operating
       Expenses              1,218   1,195   (23)  -1.9%   1,257    39    3.1%

      Operating Income        $371    $366    $5    1.4%    $409  ($38)  -9.3%
      Interest expense         109      19   (90)    N/A     119    10    8.4%
      Other expense
       (income), net             -      (5)   (5)    N/A      (5)   (5)    N/A
      Income Before Taxes     $262    $352  ($90) -25.6%    $295  ($33) -11.2%
      Income tax expense       102     138    36   26.1%     115    13   11.3%
      Net Income              $160    $214  ($54) -25.2%    $180  ($20) -11.1%



      Diluted Earnings Per
       Share                 $1.05



                         Embarq Telecommunications Segment
                         Selected Unaudited Financial Data
                     ($ in millions, except per share amounts)


                                    1Q-06                1Q-06 As
    Telecom                 1Q-07   GAAP     Fav/(Unfav) Adjusted  Fav/(Unfav)
        Voice              $1,084  $1,044   $40    3.8%  $1,161  ($77)   -6.6%
        Data                  189     169    20   11.8%     175    14     8.0%
        High-speed
         Internet             116      92    24   26.1%      92    24    26.1%
        Wireless                9       0     9     N/A       0     9      N/A
        Other services         60      81   (21) -25.9%      66    (6)   -9.1%
      Service revenues      1,458   1,386    72    5.2%   1,494   (36)   -2.4%
      Product revenues         22      23    (1)  -4.3%      20     2    10.0%
    Net Operating
     Revenues               1,480   1,409    71    5.0%   1,514   (34)   -2.2%

    Operating Expenses
      Cost of services        417     378   (39) -10.3%     429    12     2.8%
      Cost of products         30      23    (7) -30.4%      20   (10)  -50.0%
      Selling, general
       and
       administrative         392     400     8    2.0%     389    (3)   -0.8%
      Depreciation            267     235   (32) -13.6%     260    (7)   -2.7%
    Total Operating
     Expenses               1,106   1,036   (70)  -6.8%   1,098    (8)   -0.7%

    Operating Income         $374    $373    $1    0.3%    $416  ($42)  -10.1%


                              Embarq Logistics Segment
                         Selected Unaudited Financial Data
                     ($ in millions, except per share amounts)


                                    1Q-06                1Q-06 As
    Logistics               1Q-07   GAAP     Fav/(Unfav) Adjusted  Fav/(Unfav)
    Net Operating
     Revenues                109    152     (43)  -28.3%    152   (43)  -28.3%

    Operating Expenses
      Cost of services &
       products               97    137      40    29.2%    137    40    29.2%
      Selling, general and
       administrative         12     19       7    36.8%     19     7    36.8%
      Depreciation             3      3       -     0.0%      3     -     0.0%
    Total Operating
     Expenses                112    159      47    29.6%    159    47    29.6%

    Operating Income         ($3)   ($7)     $4    57.1%    ($7)   $4    57.1%



Financial Measures

For periods prior to and including May 17, 2006, the date of EMBARQ's spin-off from Sprint Nextel, reported operating income reflects the combined performance of the specific legal entities that were spun-off from Sprint Nextel in accordance with GAAP. The reported information for these entities prior to and including the date of separation does not include certain items that will be reflected in EMBARQ's reported operating income for periods subsequent to May 17, 2006. These items primarily consist of the following:

    --  In-territory consumer and business long distance customers transferred
        to EMBARQ by Sprint Nextel, as well as certain in-territory equipment
        and professional service customers transferred to Sprint Nextel by
        EMBARQ; and

    --  Other assets and liabilities related to ongoing business operations
        transferred to EMBARQ by Sprint Nextel.


In order to facilitate a comparison of EMBARQ's historical operating performance to its performance subsequent to the spin-off, Schedule 5 provides an as adjusted view of EMBARQ's quarterly operating income for 2006, including reconciliations to GAAP. The as adjusted financial information assumes the spin-off from Sprint Nextel had occurred on January 1, 2006 and includes the items described above. The as adjusted financial information is a non-GAAP measure and should be considered in addition to, but not as a substitute for, the information contained in the company's financial reporting.

Definitions

Net Debt is consolidated debt, including current maturities, less cash and equivalents. This non-GAAP measure should be used in addition to, but not as a substitute for the information provided in the balance sheets and statements of cash flows. EMBARQ believes that Net Debt provides useful information about its capacity to reduce debt and improve its capital structure.

      Reconciliation of Non-GAAP
       measure- Net Debt                      March 31,  December 31,
                                               2007        2006       Change

    Current maturities                           $37         $37         $-
    Long-term debt                             6,058       6,421       (363)
    Less: Cash and equivalents                   (46)        (53)         7
    Net Debt                                  $6,049      $6,405      $(356)


Free Cash Flow is defined as the change in cash and equivalents less cash provided or used by financing activities. This non-GAAP measure should be used in addition to, but not as a substitute for the information provided in the statement of cash flows. EMBARQ believes that Free Cash Flow provides useful information about the cash generated from core operations and its ability to fund dividends, scheduled debt maturities and other financing activities.

       Reconciliation of Free Cash Flow               March 31,
                                                        2007

       Change in cash and equivalents                    $(7)
       Less: Net cash used by financing
        activities                                       324
       Free Cash Flow                                   $317


Average Revenue per Household is calculated by dividing consumer revenues by average primary consumer access lines. While this measure is not defined under accounting principles generally accepted in the United States, the measure uses a GAAP measure as the basis for the calculation. EMBARQ believes Average Revenue per Household provides useful information concerning the success of its bundling initiatives and performance in attracting and retaining high value customers.

HSI Average Revenue per Subscriber is calculated by dividing high-speed Internet revenues by average high-speed Internet subscribers. While this measure is not defined under accounting principles generally accepted in the United States, the measure uses a GAAP measure as the basis for the calculation. EMBARQ believes HSI Average Revenue per Subscriber provides useful information concerning the appeal of its high-speed Internet pricing plans and performance in attracting and retaining high value customers.

About EMBARQ

EMBARQ (NYSE: EQ), headquartered in Overland Park, Kansas, offers a complete suite of common sense communications services. The company has approximately 20,000 employees and operates in 18 states. EMBARQ is a member of the S&P 500.

For consumers, EMBARQ offers an innovative portfolio of services that includes reliable local and long distance home phone service, high-speed Internet, wireless, and satellite TV from DISH Network(R) -- all on one monthly bill.

For businesses, EMBARQ has a comprehensive range of flexible and integrated services designed to help businesses of all sizes be more productive and communicate with their customers. This service portfolio includes local voice and data services, long distance, EMBARQ(TM) Business Class DSL, wireless, enhanced data network services, voice and data communication equipment and managed network services.

EMBARQ believes that by focusing on the communities the company serves and by employing common sense and practical ingenuity, it is able to provide customers with a committed partner, dedicated customer service and innovative products for work and home. For more information, visit embarq.com.

                               Embarq Corporation
                      Consolidated Statements of Operations
                    ($ in millions, except per share amounts)
                                   (unaudited)

    Schedule 1                                       Quarter Ended March 31,
                                                     2007              2006

    Net Operating Revenues
      Service revenues                              $1,458            $1,386
      Product revenues                                 131               175
    Net operating revenues                           1,589             1,561

    Operating Expenses
      Cost of services                                 417               378
      Cost of products                                 127               160
      Selling, general and administrative              404               419
      Depreciation                                     270               238
    Total Operating Expenses                         1,218             1,195

    Operating Income                                   371               366
    Interest expense                                   109                19
    Other (income) expense, net                          -                (5)
    Income Before Taxes                                262               352
    Income tax expense                                 102               138
    Net Income                                        $160              $214



    Basic Earnings Per Share                         $1.07
    Basic weighted average shares                    150.2

    Diluted Earnings Per Share                       $1.05
    Diluted weighted average shares                  152.4



                               Embarq Corporation
                           Consolidated Balance Sheets
                                 ($ in millions)


    Schedule 2                                    March 31,       December 31,
                                                     2007              2006
                                                 (unaudited)

    Assets
      Cash and equivalents                             $46               $53
      Accounts receivable, net                         629               660
      Inventories                                      183               179
      Prepaid expenses and other current
       assets                                          150               131
        Total current assets                         1,008             1,023

      Property, plant and equipment, net             7,910             7,988
      Other non-current assets                          65                80
        Total non-current assets                     7,975             8,068

      Total assets                                  $8,983            $9,091

    Liabilities and stockholders' equity
      Current maturities                               $37               $37
      Accounts payable                                 447               503
      Accrued payroll & benefits                       179               198
      Accrued taxes                                    242               164
      Deferred revenue                                 211               211
      Accrued interest                                 126                52
      Other current liabilities                        175                99
        Total current liabilities                    1,417             1,264

    Long-term debt                                   6,058             6,421
    Postretirement and other benefit
     obligations                                       682               685
    Deferred income taxes                            1,000             1,039
    Other non-current liabilities                      157               150
      Total non-current liabilities                  7,897             8,295

    Stockholders' equity
      Common stock                                       2                 1
      Treasury stock, at cost                           (2)                -
      Paid in capital                                 (360)             (414)
      Retained earnings                                391               308
      Accumulated other comprehensive
       income (loss)                                  (362)             (363)
        Total stockholders' equity                    (331)             (468)

      Total liabilities and stockholders'
       equity                                       $8,983            $9,091


                               Embarq Corporation
                      Consolidated Statements of Cash Flows
                                 ($ in millions)
                                   (unaudited)


    Schedule 3                                        Quarter Ended March 31,
                                                      2007              2006

    Operating Activities
    Net income                                        $160              $214
    Depreciation                                       270               238
    Deferred and uncertain income tax
     provisions                                        (36)               (9)
    Provision for losses on accounts
     receivable                                         17                12
    Stock-based compensation expense                    14                 -
    Net losses (gains) on sales of assets               (3)               (7)
    Other, net                                          11                (4)
    Changes in assets and liabilities:
           Accounts receivable                          14                54
           Inventories and other current
            assets                                     (28)               52
           Accounts payable and other
            current liabilities                         75                48
           Noncurrent assets and
            liabilities, net                           (14)                7
        Net cash provided by operating
         activities                                    480               605

    Investing Activities
    Capital expenditures                              (183)             (184)
    Proceeds from construction
     reimbursements                                      3                 2
    Proceeds from sales of assets                       17                20
        Net cash used by investing
         activities                                   (163)             (162)

    Financing Activities
    Changes in debt, net                              (360)                -
    Dividends paid to stockholders                      (4)                -
    Common stock issued                                 35                 -
    Dividends paid to Sprint Nextel                      -              (194)
    Other, net                                           5                 -
        Net cash used by financing
         activities                                   (324)             (194)

    Change in cash and equivalents                      (7)              249

    Cash and equivalents at beginning of
     period                                             53               103

    Cash and equivalents at end of period              $46              $352


                                Embarq Corporation
                 Operating Statistics - As Adjusted* (unaudited)
            (Revenues in millions; lines and subscribers in thousands)
        (* Note: As adjusted is a non-GAAP measure.  See Schedule 5 for a
                             reconciliation to GAAP.)

    Schedule 4
                               1Q-07           4Q-06   3Q-06
                                (1)     2006    (1)     (1)    2Q-06   1Q-06
    Service and Product
     Revenues
        Voice                  $1,084  $4,519  $1,120  $1,109  $1,129  $1,161
        Data                      189     716     183     180     178     175
        High-speed Internet       116     393     108      98      95      92
        Wireless                    9       7       4       3       -       -
        Other                      60     248      57      64      61      66
      Service revenues          1,458   5,883   1,472   1,454   1,463   1,494
        EMBARQ Logistics          109     530     115     125     138     152
        Other                      22     106      30      27      29      20
      Product revenues            131     636     145     152     167     172
    Net operating revenues     $1,589  $6,519  $1,617  $1,606  $1,630  $1,666

    Operating Unit Revenues
        Consumer                 $682  $2,726    $671    $668    $686    $701
        Business                  384   1,522     381     389     379     373
        Wholesale                 414   1,741     450     424     427     440
      Telecommunications        1,480   5,989   1,502   1,481   1,492   1,514
      EMBARQ Logistics            109     530     115     125     138     152
    Net operating revenues     $1,589  $6,519  $1,617  $1,606  $1,630  $1,666

    Access Lines
      Consumer                  4,588           4,659   4,731   4,835   4,970
      Business                  2,065           2,059   2,069   2,074   2,079
      Wholesale                   184             190     198     208     219
    Total                       6,837           6,908   6,998   7,117   7,268

    Consumer Average Revenue
     per Household
      Consumer revenue           $682            $671    $668    $686    $701
      Average households served 4,261           4,316   4,384   4,482   4,571
    Monthly revenue per
     average HH                $53.35          $51.82  $50.79  $51.02  $51.12

    High-speed Internet Lines
      Consumer                    916             838     763     690     625
      Business                    149             142     135     127     121
      Wholesale                    39              37      35      32      31
    Total                       1,104           1,017     933     849     777

    HSI Average Revenue per
     Subscriber
      High-speed Internet
       revenue                   $116            $108     $98     $95     $92
      Average HSI subscribers   1,061             975     891     813     735
    Monthly revenue per
     average subscriber        $36.44          $36.92  $36.66  $38.95  $41.72

    Wireless Subscribers
      Consumer                     65              44      21       4       -
      Business                      6               4       3       1       -
    Total                          71              48      24       5       -

    Entertainment Subscribers     170             162     146     131     109

    (1)  As EMBARQ completed the spin-off from Sprint-Nextel on May 17, 2006,
         periods subsequent to the second quarter 2006 represent GAAP results


                                Embarq Corporation
                 Reconciliations of Non-GAAP Measures (unaudited)
                                 ($ in millions)
    Schedule 5


                                     LD              Shared
    Year Ended                    Customer           Assets /             As
     December 31,2006        GAAP Transfers Pension Liabilities Other Adjusted
    Net Operating Revenues
        Voice               $4,346   $172     $-        $-       $1     $4,519
        Data                   706      6      -         -        4        716
        High-speed Internet    393      -      -         -        -        393
        Wireless                 7      -      -         -        -          7
        Other                  270    (22)     -         -        -        248
      Service revenues       5,722    156      -         -        5      5,883
        EMBARQ Logistics       530      -      -         -        -        530
        Other                  111     (5)     -         -        -        106
      Product revenues         641     (5)     -         -        -        636
    Net operating
     revenues               $6,363   $151     $-        $-       $5     $6,519

    Operating Expenses
      Cost of services       1,594     73      -         -        1      1,668
      Cost of products         598     (4)     -         -        -        594
      Selling, general and
       administrative        1,600     35      -       (52)       1      1,584
      Depreciation           1,027      -      -        38        -      1,065
    Total Operating
     Expenses                4,819    104      -       (14)       2      4,911

    Operating Income        $1,544    $47     $-       $14       $3     $1,608

    Operating Unit
     Revenues
        Consumer            $2,590   $136     $-        $-       $-     $2,726
        Business             1,492     28      -         -        2      1,522
        Wholesale            1,751    (13)     -         -        3      1,741
      Telecommunications     5,833    151      -         -        5      5,989
      EMBARQ Logistics         530      -      -         -        -        530
    Net operating revenues  $6,363   $151     $-        $-       $5     $6,519

    Capital Expenditures      $923     $-     $-       $67       $-       $990


                                     LD              Shared
    Quarter Ended                 Customer           Assets /             As
     June 30, 2006           GAAP Transfers Pension Liabilities Other Adjusted
    Net Operating Revenues
        Voice              $1,073    $56      $-       $-         $-    $1,129
        Data                  174      2       -        -          2       178
        High-speed
         Internet              95      -       -        -          -        95
        Wireless                -      -       -        -          -         -
        Other                  68     (7)      -        -          -        61
      Service revenues      1,410     51       -        -          2     1,463
        EMBARQ Logistics      138      -       -        -          -       138
        Other                  31     (2)      -        -          -        29
      Product revenues        169     (2)      -        -          -       167
    Net operating
     revenues              $1,579    $49      $-       $-         $2    $1,630

    Operating Expenses
      Cost of services        367     23       -        -          -       390
      Cost of products        149     (1)      -        -          -       148
      Selling, general and
       administrative         403     13       -      (18)         -       398
      Depreciation            254      -       -       13          -       267
    Total Operating
     Expenses               1,173     35       -       (5)         -     1,203

    Operating Income         $406    $14      $-       $5         $2      $427

    Operating Unit Revenues
        Consumer             $642    $44      $-       $-         $-      $686
        Business              369      9       -        -          1       379
        Wholesale             430     (4)      -        -          1       427
      Telecommunications    1,441     49       -        -          2     1,492
      EMBARQ Logistics        138      -       -        -          -       138
    Net operating
     revenues              $1,579    $49      $-       $-         $2    $1,630

    Capital Expenditures     $265     $-      $-      $47         $-      $312


                                     LD              Shared
    Quarter Ended                 Customer           Assets /             As
     March 31, 2006          GAAP Transfers Pension Liabilities Other Adjusted
    Net Operating Revenues
        Voice               $1,044  $116       $-       $-       $1    $1,161
        Data                   169     4        -        -        2       175
        High-speed
         Internet               92     -        -        -        -        92
        Wireless                 -     -        -        -        -         -
        Other                   81   (15)       -        -        -        66
      Service revenues       1,386   105        -        -        3     1,494
        EMBARQ Logistics       152     -        -        -        -       152
        Other                   23    (3)       -        -        -        20
      Product revenues         175    (3)       -        -        -       172
    Net operating
     revenues               $1,561  $102       $-       $-       $3    $1,666

    Operating Expenses
      Cost of services         378    50        -        -        1       429
      Cost of products         160    (3)       -        -        -       157
      Selling, general and
       administrative          419    22        -      (34)       1       408
      Depreciation             238     -        -       25        -       263
    Total Operating
     Expenses                1,195    69        -       (9)       2     1,257

    Operating Income          $366   $33       $-       $9       $1      $409

    Operating Unit Revenues
        Consumer              $609   $92       $-       $-       $-      $701
        Business               353    19        -        -        1       373
        Wholesale              447    (9)       -        -        2       440
      Telecommunications     1,409   102        -        -        3     1,514
      EMBARQ Logistics         152     -        -        -        -       152
    Net operating
     revenues               $1,561  $102       $-       $-       $3    $1,666

    Capital Expenditures      $184    $-       $-      $20       $-      $204


                          Telecommunications Segment
               Reconciliations of Non-GAAP Measures (unaudited)
                                ($ in millions)
    Schedule 6


                                     LD              Shared
    Quarter Ended                 Customer           Assets /             As
     March 31, 2006          GAAP Transfers Pension Liabilities Other Adjusted
    Net Operating Revenues
        Voice               $1,044  $116       $-       $-        $1   $1,161
        Data                   169     4        -        -         2      175
        High-speed Internet     92     -        -        -         -       92
        Wireless                 -     -        -        -         -        -
        Other                   81   (15)       -        -         -       66
      Service revenues       1,386   105        -        -         3    1,494
      Product revenues          23    (3)       -        -         -       20
    Net operating
     revenues               $1,409  $102       $-       $-        $3   $1,514

    Operating Expenses
      Cost of services         378    50        -        -         1      429
      Cost of products          23    (3)       -        -         -       20
      Selling, general and
       administrative          400    22        -      (34)        1      389
      Depreciation             235     -        -       25         -      260
    Total Operating
     Expenses                1,036    69        -       (9)        2    1,098

    Operating Income          $373   $33       $-       $9        $1     $416

    Operating Unit Revenues
        Consumer              $609   $92       $-       $-        $-     $701
        Business               353    19        -        -         1      373
        Wholesale              447    (9)       -        -         2      440
      Telecommunications     1,409   102        -        -         3    1,514

    Capital Expenditures      $183    $-       $-      $20        $-     $203


SOURCE EMBARQ

 

http://www.embarq.com