Item 8. Financial Statements and Supplementary Data

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Item 8. Financial Statements and Supplementary Data

Crown Castle International Corp. and Subsidiaries

Index to Consolidated Financial Statements and Financial Statement Schedules

Page
Report of Independent Registered Public Accounting Firm45
Consolidated Balance Sheet as of December 31, 2018 and 201747
Consolidated Statement of Operations and Comprehensive Income (Loss) for each of the three years in the period ended December 31, 201848
Consolidated Statement of Cash Flows for each of the three years in the period ended December 31, 201849
Consolidated Statement of Equity for each of the three years in the period ended December 31, 201850
Notes to Consolidated Financial Statements53
Schedule II - Valuation and Qualifying Accounts for the years ended December 31, 2018, 2017 and 201693
Schedule III - Schedule of Real Estate and Accumulated Depreciation for the years ended December 31, 2018 and 201794

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of

Crown Castle International Corp.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Crown Castle International Corp. and its subsidiaries (the “Company”) as of December 31, 2018 and 2017, and the related consolidated statements of operations and comprehensive income (loss), of cash flows, and of equity for each of the three years in the period ended December 31, 2018, including the related notes and financial statement schedules listed in the accompanying index (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2018 and 2017, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2018 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ PricewaterhouseCoopers LLP

Pittsburgh, Pennsylvania

February 25, 2019

We have served as the Company’s auditor since 2011.

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(In millions of dollars, except par values)

December 31,
20182017
ASSETS
Current assets:
Cash and cash equivalents$277$314
Restricted cash131121
Receivables, net of allowance of $14 and $14, respectively501398
Prepaid expenses172162
Other current assets148139
Total current assets1,2291,134
Deferred site rental receivables1,3661,300
Property and equipment, net13,67612,933
Goodwill10,07810,021
Site rental contracts and tenant relationships, net5,2095,626
Other intangible assets, net307336
Long-term prepaid rent and other assets, net920879
Total assets$32,785$32,229
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable$313$249
Accrued interest148132
Deferred revenues498457
Other accrued liabilities351339
Current maturities of debt and other obligations107115
Total current liabilities1,4171,292
Debt and other long-term obligations16,57516,044
Other long-term liabilities2,7592,554
Total liabilities20,75119,890
Commitments and contingencies (see note 13)
CCIC stockholders' equity:
Common stock, $0.01 par value; 600 shares authorized; shares issued and outstanding: December 31, 2018—415 and December 31, 2017—40644
6.875% Mandatory Convertible Preferred Stock, Series A, $0.01 par value; 20 shares authorized; shares issued and outstanding: December 31, 2018—2 and December 31, 2017—2; aggregate liquidation value: December 31, 2018—$1,650 and December 31, 2017—$1,650——
Additional paid-in capital17,76716,844
Accumulated other comprehensive income (loss)(5)(4)
Dividends/distributions in excess of earnings(5,732)(4,505)
Total equity12,03412,339
Total liabilities and equity$32,785$32,229

See accompanying notes to consolidated financial statements.

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(In millions of dollars, except per share amounts)

Years Ended December 31,
201820172016
Net revenues:
Site rental$4,716$3,669$3,233
Services and other707687688
Net revenues5,4234,3563,921
Operating expenses:
Costs of operations(a):
Site rental1,4101,1441,024
Services and other437420417
Selling, general and administrative563426371
Asset write-down charges261734
Acquisition and integration costs276117
Depreciation, amortization and accretion1,5281,2421,109
Total operating expenses3,9913,3102,972
Operating income (loss)1,4321,046949
Interest expense and amortization of deferred financing costs(642)(591)(515)
Gains (losses) on retirement of long-term obligations(106)(4)(52)
Interest income5191
Other income (expense)11(9)
Income (loss) before income taxes690471374
Benefit (provision) for income taxes(19)(26)(17)
Net income (loss)671445357
Dividends on preferred stock(113)(58)(33)
Net income (loss) attributable to CCIC common stockholders$558$387$324
Net income (loss)$671$445$357
Other comprehensive income (loss):
Foreign currency translation adjustments(1)2(2)
Total other comprehensive income (loss)(1)2(2)
Comprehensive income (loss) attributable to CCIC stockholders$670$447$355
Net income (loss) attributable to CCIC common stockholders, per common share:
Net income (loss) attributable to CCIC common stockholders—basic$1.35$1.01$0.95
Net income (loss) attributable to CCIC common stockholders—diluted$1.34$1.01$0.95
Weighted-average common shares outstanding:
Basic413382340
Diluted415383341
(a)Exclusive of depreciation, amortization and accretion shown separately.

See accompanying notes to consolidated financial statements.

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(In millions of dollars)

Years Ended December 31,
2018(a)2017(a)2016(a)
Cash flows from operating activities:
Net income (loss)$671$445$357
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:
Depreciation, amortization and accretion1,5281,2421,109
(Gains) losses on retirement of long-term obligations106452
(Gains) losses on settled swaps——3
Amortization of deferred financing costs and other non-cash interest7914
Stock-based compensation expense1039279
Asset write-down charges261734
Deferred income tax (benefit) provision2159
Other non-cash adjustments, net2(2)10
Changes in assets and liabilities, excluding the effects of acquisitions:
Increase (decrease) in accrued interest163530
Increase (decrease) in accounts payable37(34)11
Increase (decrease) in deferred revenues, deferred ground lease payables, other accrued liabilities and other liabilities223175196
Decrease (increase) in receivables(105)61(59)
Decrease (increase) in prepaid expenses, deferred site rental receivables, long-term prepaid rent and other assets(114)(16)(58)
Net cash provided by (used for) operating activities2,5022,0431,787
Cash flows from investing activities:
Payments for acquisitions, net of cash acquired(42)(9,260)(557)
Capital expenditures(1,741)(1,228)(874)
Net (payments) receipts from settled swaps——8(b)
Other investing activities, net(12)(5)(6)
Net cash provided by (used for) investing activities(1,795)(10,493)(1,429)
Cash flows from financing activities:
Proceeds from issuance of long-term debt2,7423,0935,201
Principal payments on debt and other long-term obligations(105)(119)(96)
Purchases and redemptions of long-term debt(2,346)—(4,045)
Borrowings under revolving credit facility1,8202,8203,440
Payments under revolving credit facility(1,725)(1,840)(4,565)
Payments for financing costs(31)(29)(42)
Net proceeds from issuance of common stock8414,2211,326
Net proceeds from issuance of preferred stock—1,608—
Purchases of common stock(34)(23)(25)
Dividends/distributions paid on common stock(1,782)(1,509)(1,239)
Dividends paid on preferred stock(113)(30)(44)
Net cash provided by (used for) financing activities(733)8,192(89)
Net increase (decrease) in cash, cash equivalents, and restricted cash from continuing operations(26)(258)269
Discontinued operations:
Net cash provided by (used for) investing activities——113(b)
Net increase (decrease) in cash and cash equivalents - discontinued operations——113
Effect of exchange rate changes on cash(1)1—
Cash, cash equivalents, and restricted cash at beginning of period(a)440697315
Cash, cash equivalents, and restricted cash at end of period(a)$413$440$697
(a)See "Recently Adopted Accounting Pronouncements" in note 2 to the financial statements for a discussion of recently adopted restricted cash guidance, which impacted certain presentations on the consolidated statement of cash flows.
(b)In January 2016, the Company received a note receivable payment and settled a corresponding foreign currency swap related to its 2015 sale of CCAL.

See accompanying notes to consolidated financial statements.

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF EQUITY

(Amounts in millions)

Common Stock6.875% Mandatory Convertible Preferred Stock4.50% Mandatory Convertible Preferred Stock
Shares($0.01 Par)Shares($0.01 Par)Shares($0.01 Par)Additional Paid-In CapitalAccumulated Other Comprehensive Income (Loss) ("AOCI")Dividends/Distributions in Excess of EarningsTotal
Balance, December 31, 2015334$4——10—$—$9,549$(4)$(2,458)$7,091
Stock-based compensation related activity, net of forfeitures———————86——86
Purchases and retirement of common stock———————(25)——(25)
Net proceeds from issuance of Common Stock15—————1,326——1,326
Net proceeds from issuance of preferred stock——————————
Other comprehensive income (loss)(a)————————(2)—(2)
Recognition of excess tax benefit——————2——2
Common stock dividends/distributions————————(1,245)(1,245)
Preferred stock dividends—————————(33)(33)
Conversion of preferred stock to common stock (see note 11)12———(10)——————
Net income (loss)————————357357
Balance, December 31, 2016361$4———$—$10,938$(6)$(3,379)$7,557
(a)See the consolidated statement of operations and comprehensive income (loss) for the components of "total other comprehensive income (loss)".

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF EQUITY

(Amounts in millions)

Common Stock6.875% Mandatory Convertible Preferred Stock4.50% Mandatory Convertible Preferred Stock
Shares($0.01 Par)Shares($0.01 Par)Shares($0.01 Par)Additional Paid-In CapitalAOCIDividends/Distributions in Excess of EarningsTotal
Balance, December 31, 2016361$4———$—$10,938$(6)$(3,379)$7,557
Stock-based compensation related activity, net of forfeitures1—————100——100
Purchases and retirement of common stock——————(23)——(23)
Net proceeds from issuance of common stock44—————4,221——4,221
Net proceeds from issuance of preferred stock——2———1,608——1,608
Other comprehensive income (loss)(a)———————2—2
Common stock dividends/distributions————————(1,513)(1,513)
Preferred stock dividends————————(58)(58)
Net income (loss)————————445445
Balance, December 31, 2017406$42——$—$16,844$(4)$(4,505)$12,339
(a)See the consolidated statement of operations and comprehensive income (loss) for the components of "total other comprehensive income (loss)."

See accompanying notes to consolidated financial statements.

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF EQUITY

(Amounts in millions)

Common Stock6.875% Mandatory Convertible Preferred Stock4.50% Mandatory Convertible Preferred Stock
Shares($0.01 Par)Shares($0.01 Par)Shares($0.01 Par)Additional Paid-In CapitalAOCIDividends/Distributions in Excess of EarningsTotal
Balance, December 31, 2017406$42——$—$16,844$(4)$(4,505)$12,339
Stock-based compensation related activity, net of forfeitures1——————116——116
Purchases and retirement of common stock———————(34)——(34)
Net proceeds from issuances of common stock (see note 11)8—————841——841
Other comprehensive income (loss)(a)————————(1)—(1)
Common stock dividends/distributions————————(1,785)(1,785)
Preferred stock dividends—————————(113)(113)
Net income (loss)—————————671671
Balance, December 31, 2018415$42——$—$17,767$(5)$(5,732)$12,034
(a)See the consolidated statement of operations and comprehensive income (loss) for the components of "total other comprehensive income (loss)."

See accompanying notes to consolidated financial statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in millions, except per share amounts)

1.Basis of Presentation

The consolidated financial statements include the accounts of Crown Castle International Corp. and its predecessor, as applicable (together, "CCIC"), and their subsidiaries, collectively referred to herein as the "Company." All significant intercompany balances and transactions have been eliminated in consolidation. As used herein, the term "including," and any variation thereof, means "including without limitation." The use of the word "or" herein is not exclusive. Unless the context suggests otherwise, references to "U.S." are to the United States of America and Puerto Rico, collectively.

The Company owns, operates and leases shared communications infrastructure that is geographically dispersed throughout the U.S, including (1) towers and other structures, such as rooftops (collectively, "towers"), and (2) fiber primarily supporting small cell networks ("small cells") and fiber solutions. The Company's towers, fiber and small cells assets are collectively referred to herein as "communications infrastructure," and the Company's customers on its communications infrastructure are referred to herein as "tenants."

The Company's core business is providing access, including space or capacity, to its shared communications infrastructure via long-term contracts in various forms, including lease, license, sublease and service agreements (collectively, "contracts").

53% of the Company's towers are leased or subleased or operated and managed under master leases, subleases, or other agreements with AT&T, Sprint, and T-Mobile. The Company has the option to purchase these towers at the end of their respective lease terms. The Company has no obligation to exercise such purchase options. Additional information concerning these towers is as follows:

◦22% of the Company's towers are leased or subleased or operated and managed under a master prepaid lease or other related agreements with AT&T for a weighted-average initial term of approximately 28 years, weighted on Towers site rental gross margin. The Company has the option to purchase the leased and subleased towers from AT&T at the end of the respective lease or sublease terms for aggregate option payments of approximately $4.2 billion, which payments, if exercised, would be due between 2032 and 2048.
◦16% of the Company's towers are leased or subleased or operated and managed for an initial period of 32 years (through May 2037) under master leases, subleases, or other agreements with Sprint. The Company has the option to purchase in 2037 all (but not less than all) of the leased and subleased Sprint towers from Sprint for approximately $2.3 billion.
◦15% of the Company's towers are leased or subleased or operated and managed under a master prepaid lease or other related agreements with T-Mobile for a weighted-average initial term of approximately 28 years, weighted on Towers site rental gross margin. The Company has the option to purchase the leased and subleased towers from T-Mobile at the end of the respective lease or sublease terms for aggregate option payments of approximately $2.0 billion, which payments, if exercised would be due between 2035 and 2049. In addition, through the acquisition of the rights to approximately 7,100 towers ("T-Mobile Acquisition"), there are another 1% of the Company's towers subject to a lease and sublease or other related arrangements with AT&T. The Company has the option to purchase these towers that it does not otherwise already own at the end of their respective lease terms for aggregate option payments of up to approximately $405 million, which payments, if exercised, would be due prior to 2032 (less than $10 million would be due before 2025).

As part of the Company's effort to provide comprehensive communications infrastructure solutions, the Company also offers certain services primarily relating to the Company's towers and small cells, predominately consisting of (1) site development services primarily relating to existing or new tenant equipment installations, including: site acquisition, architectural and engineering, or zoning and permitting (collectively, "site development services") and (2) tenant equipment installation or subsequent augmentations (collectively, "installation services"). The vast majority of the Company's services relate to its Towers segment.

The Company operates as a real estate investment trust ("REIT") for U.S. federal income tax purposes. In addition, the Company has certain taxable REIT subsidiaries ("TRSs"). See note 10.

The preparation of financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

The Company has changed its presentation from thousands to millions and, as a result, any necessary rounding adjustments have been made to prior year disclosed amounts.

2.Summary of Significant Accounting Policies

The following is a discussion of the Company's significant accounting policies in effect for the year ended December 31, 2018.

Restricted Cash

Restricted cash represents (1) the cash held in reserve by the indenture trustees pursuant to the indenture governing certain of the Company's debt instruments, (2) cash securing performance obligations such as letters of credit, as well as (3) any other cash whose use is limited by contractual provisions. The restriction of rental cash receipts is a critical feature of certain of the Company's debt instruments, due to the applicable indenture trustee's ability to utilize the restricted cash for the payment of (1) debt service costs, (2) ground rents, (3) real estate or personal property taxes, (4) insurance premiums related to towers, (5) other assessments by governmental authorities and potential environmental remediation costs, or (6) a portion of advance rents from tenants. The restricted cash in excess of required reserve balances is subsequently released to the Company in accordance with the terms of the indentures. See note 16 for a reconciliation of cash, cash equivalents and restricted cash.

Receivables Allowance

An allowance for doubtful accounts is recorded as an offset to accounts receivable. The Company uses judgment in estimating this allowance and considers historical collections, current credit status, or contractual provisions. Additions to the allowance for doubtful accounts are charged either to "site rental costs of operations" or to "services and other costs of operations," as appropriate; and deductions from the allowance are recorded when specific accounts receivable are written off as uncollectible.

Lease Accounting

General. The Company classifies its leases at inception as either operating leases or capital leases. A lease is classified as a capital lease if at least one of the following criteria is met, subject to certain exceptions noted below: (1) the lease transfers ownership of the leased assets to the lessee, (2) there is a bargain purchase option, (3) the lease term is equal to 75% or more of the economic life of the leased assets, or (4) the present value of the minimum lease payments equals or exceeds 90% of the fair value of the leased assets.

Lessee. Leases for land are evaluated for capital lease treatment if at least one of the first two criteria mentioned in the immediately preceding paragraph is present relating to the leased assets. When the Company, as lessee, classifies a lease as a capital lease, it records an asset in an amount equal to the present value of the minimum lease payments under the lease at the beginning of the lease term. Applicable operating leases are recognized on a straight-line basis as discussed under "costs of operations" below.

Lessor. If the Company is the lessor of leased property that is part of a larger whole (including a portion of space on a tower) and for which fair value is not objectively determinable, then such a lease is accounted for as an operating lease. As applicable, operating leases are recognized on a straight-line basis as discussed under "Revenue Recognition."

Effective January 1, 2019, the Company adopted new lease accounting guidance on the recognition, measurement, presentation and disclosure of leases. See also "Recent Accounting Pronouncements Not Yet Adopted" below for further discussion.

Property and Equipment

Property and equipment is stated at cost, net of accumulated depreciation. Property and equipment includes land owned in fee and perpetual easements for land, which have no definite life. When the Company purchases fee ownership or perpetual easements for the land previously subject to ground lease, the Company reduces the value recorded as land by the amount of any associated deferred ground lease payable or unamortized above-market leases. Depreciation is computed utilizing the straight-line method at rates based upon the estimated useful lives of the various classes of assets. Depreciation of communications infrastructure is computed with a useful life equal to the shorter of 20 years or the term of the underlying ground lease (including optional renewal periods). Additions, renewals, and improvements are capitalized, while maintenance and repairs are expensed. Labor and interest costs incurred directly related to the construction of certain property and equipment are capitalized during the construction phase of projects. For the years ended December 31, 2018, 2017, and 2016, the Company had $212 million, $92

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

million, and $86 million in capitalized labor costs, respectively. The carrying value of property and equipment is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable.

Abandonments and write-offs of property and equipment are recorded to "asset write-down charges" on the Company's consolidated statement of operations and comprehensive income (loss) and were $22 million, $14 million, and $27 million for the years ended December 31, 2018, 2017, and 2016, respectively.

Asset Retirement Obligations

Pursuant to its ground lease, easement and leased facility agreements, the Company records obligations to perform asset retirement activities, including requirements to remove communications infrastructure or remediate the space upon which certain of the Company's communications infrastructure resides. Asset retirement obligations are included in "other long-term liabilities" on the Company's consolidated balance sheet. The liability accretes as a result of the passage of time and the related accretion expense is included in "depreciation, amortization and accretion" on the Company's consolidated statement of operations and comprehensive income (loss). The associated asset retirement costs are capitalized as an additional carrying amount of the related long-lived asset and depreciated over the useful life of such asset.

Goodwill

Goodwill represents the excess of the purchase price for an acquired business over the allocated value of the related net assets. The Company tests goodwill for impairment on an annual basis, regardless of whether adverse events or changes in circumstances have occurred. The annual test begins with goodwill and all intangible assets being allocated to applicable reporting units. The Company's reporting units are the same as its operating segments (Towers and Fiber). The Company then performs a qualitative assessment to determine whether it is "more likely than not" that the fair value of the reporting units is less than its carrying amount. If it is concluded that it is "more likely than not" that the fair value of a reporting unit is less than its carrying amount, it is necessary to perform the two-step goodwill impairment test. The two-step goodwill impairment test begins with a comparison of the estimated fair value of the reporting unit and the carrying value of the reporting unit. The first step, commonly referred to as a "step-one impairment test," is a screen for potential impairment while the second step measures the amount of impairment if there is an indication from the first step that one exists. The Company's measurement of the fair value for goodwill is based on an estimate of discounted expected future cash flows of the reporting unit. The Company performed its most recent annual goodwill impairment test as of October 1, 2018, which resulted in no impairments.

Intangible Assets

Intangible assets are included in "site rental contracts and tenant relationships, net" and "other intangible assets, net" on the Company's consolidated balance sheet and predominately consist of the estimated fair value of the following items recorded in conjunction with acquisitions: (1) site rental contracts and tenant relationships, (2) below-market leases for land interest under the acquired communications infrastructure, or (3) other contractual rights such as trademarks. The site rental contracts and tenant relationships intangible assets are comprised of (1) the current term of the existing leases, (2) the expected exercise of the renewal provisions contained within the existing leases, which automatically occur under contractual provisions, or (3) any associated relationships that are expected to generate value following the expiration of all renewal periods under existing leases.

The useful lives of intangible assets are estimated based on the period over which the intangible asset is expected to benefit the Company and gives consideration to the expected useful life of other assets to which the useful life may relate. Amortization expense for intangible assets is computed using the straight-line method over the estimated useful life of each of the intangible assets. The useful life of the site rental contracts and tenant relationships intangible asset is limited by the maximum depreciable life of the communications infrastructure (20 years), as a result of the interdependency of the communications infrastructure and site rental leases. In contrast, the site rental contracts and tenant relationships are estimated to provide economic benefits for several decades because of the low rate of tenant cancellations and high rate of renewals experienced to date. Thus, while site rental contracts and tenant relationships are valued based upon the fair value, which includes assumptions regarding both (1) tenants' exercise of optional renewals contained in the acquired leases and (2) renewals of the acquired leases past the contractual term including exercisable options, the site rental contracts and tenant relationships are amortized over a period not to exceed 20 years as a result of the useful life being limited by the depreciable life of the communications infrastructure.

The carrying value of other intangible assets with finite useful lives will be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. The Company has a dual grouping policy for purposes of determining the unit of account for testing impairment of the site rental contracts and tenant relationships intangible assets. First, the Company pools the site rental contracts and tenant relationships with the related communications infrastructure assets into portfolio groups for purposes of determining the unit of account for impairment testing. Second and

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

separately, the Company evaluates the site rental contracts and tenant relationships by significant tenant or by tenant grouping for individually insignificant tenants, as appropriate. If the sum of the estimated future cash flows (undiscounted) expected to result from the use or eventual disposition of an asset is less than the carrying amount of the asset, an impairment loss is recognized. Measurement of an impairment loss is based on the fair value of the asset.

Deferred Credits

Deferred credits are included in "deferred revenues" and "other long-term liabilities" on the Company's consolidated balance sheet and consist of the estimated fair value of the following items recorded in conjunction with acquisitions: (1) below-market tenant leases for contractual interests with tenants on acquired communications infrastructure, which are amortized to site rental revenues and (2) above-market leases for land interests under the Company's communications infrastructure, which are amortized to site rental cost of operations.

Fair value for these deferred credits represents the difference between (1) the stated contractual payments to be made pursuant to the in-place lease and (2) management's estimate of fair market lease rates for each corresponding lease. Deferred credits are measured over a period equal to the estimated remaining economic lease term considering renewal provisions or economics associated with those renewal provisions, to the extent applicable. Deferred credits are amortized over their respected estimated lease terms at the time of acquisition.

Deferred Financing Costs

Third-party costs incurred to obtain financing, with the exception of costs incurred related to revolving lines of credit, are deferred and are included as a direct deduction from the carrying amount of the related debt liability in "debt and other long-term obligations" on the Company's consolidated balance sheet. Third party costs incurred to obtain financing through a revolving line of credit are deferred and are included in "long-term prepaid rent and other assets, net" on the Company's consolidated balance sheet.

Revenue Recognition

The Company generates site rental revenues from its core business by providing tenants with access, including space or capacity, to its shared communications infrastructure via long-term contracts in various forms, including lease, license, sublease and service agreements. Providing such access over the length of the contract term represents the Company’s sole performance obligation under its site rental contracts.

Site rental revenues. Site rental revenues from the Company's contracts are recognized on a straight-line, ratable basis over the fixed, non-cancelable term of the relevant contract, which generally ranges from five to 15 years for wireless tenants and three to 20 years related to the Company's fiber solutions tenants (including from organizations with high-bandwidth and multi-location demands), regardless of whether the payments from the tenant are received in equal monthly amounts during the life of the contract. Certain of the Company's contracts contain fixed escalation clauses (such as fixed dollar or fixed percentage increases) or inflation-based escalation clauses (such as those tied to the consumer price index ("CPI")). If the payment terms call for fixed escalations, upfront payments, or rent free periods, the revenue is recognized on a straight-line basis over the fixed, non-cancelable term of the agreement. When calculating straight-line rental revenues, the Company considers all fixed elements of tenant contractual escalation provisions, even if such escalation provisions contain a variable element in addition to a minimum. The Company's assets related to straight-line site rental revenues include current amounts of $92 million and $86 million included in "other current assets" and non-current amounts of $1.4 billion and $1.3 billion included in "deferred site rental receivables" for the years ended December 31, 2018 and 2017, respectively. Amounts billed or received prior to being earned are deferred and reflected in "deferred revenues" and "other long-term liabilities." Amounts to which the Company has an unconditional right to payment, which are related to both satisfied or partially satisfied performance obligations, are recorded within "receivables, net" on the Company's consolidated balance sheet.

Services and other revenues. As part of the Company’s effort to provide comprehensive communications infrastructure solutions, the Company offers certain services, primarily relating to its towers and small cells, predominately consisting of (1) site development services and (2) installation services. Upon contract commencement, the Company assesses its services to tenants and identifies performance obligations for each promise to provide a distinct service.

The Company may have multiple performance obligations for site development services, which primarily include: structural analysis, zoning, permitting and construction drawings. For each of the above performance obligations, services revenues are recognized at completion of the applicable performance obligation, which represents the point at which the Company believes it has transferred goods or services to the tenant. The revenue recognized is based on an allocation of the transaction price among

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

the performance obligations in a respective contract based on estimated standalone selling price. The volume and mix of site development services may vary among contracts and may include a combination of some or all of the above performance obligations. Payments generally are due within 45 to 60 days and generally do not contain variable-consideration provisions. The Company has one performance obligation for installation services, which is satisfied at the time of the respective installation or augmentation.

Since performance obligations are typically satisfied prior to receiving payment from tenants, the unconditional right to payment is recorded within "receivables, net" on the Company’s consolidated balance sheet. The vast majority of the Company’s services relates to the Company’s Towers segment, and generally have a duration of one year or less.

Additional information on revenues. As of January 1, 2018 and December 31, 2018, $2.1 billion and $2.3 billion of unrecognized revenue, respectively, was reported in "deferred revenues" and "other non-current liabilities" on our consolidated balance sheet. During the year ended December 31, 2018, approximately $400 million of the January 1, 2018 unrecognized revenue balance was recognized as revenue.

See also "Recently Adopted Accounting Pronouncements" below for further discussion.

Costs of Operations

Approximately half of the Company's site rental costs of operations expenses consist of Towers ground lease expenses, and the remainder includes fiber access expenses, property taxes, repairs and maintenance expenses, employee compensation or related benefit costs, or utilities. Generally, the ground leases for land are specific to each site and are for an initial term of five years and are renewable for pre-determined periods. The Company also enters into term easements and ground leases in which it prepays the entire term in advance. Fiber access expenses primarily consist of leases of fiber assets and other access agreements to facilitate the Company's communications infrastructure.

Ground lease and fiber access expenses are recognized on a ratable basis, regardless of whether the payment terms require the Company to make payments annually, quarterly, monthly, or for the entire term in advance. Certain of the Company's ground lease and fiber access agreements contain fixed escalation clauses (such as fixed dollar or fixed percentage increases) or inflation-based escalation clauses (such as those tied to the CPI). If the payment terms include fixed escalation provisions, the effect of such increases is recognized on a straight-line basis. The Company calculates the straight-line expense using a time period that equals or exceeds the remaining depreciable life of the communications infrastructure asset. Further, when a tenant has exercisable renewal options that would compel the Company to exercise existing renewal options, the Company has straight-lined the expense over a sufficient portion of such renewals to coincide with the final termination of the tenant's renewal options. The Company's non-current liability related to straight-line expense is included in "other long-term liabilities" on the Company's consolidated balance sheet. The Company's assets related to prepaid agreements is included in "prepaid expenses" and "long-term prepaid rent and other assets, net" on the Company's consolidated balance sheet.

Services and other costs of operations predominately consist of third-party service providers such as contractors and professional services firms and, to a lesser extent, internal labor costs.

Acquisition and Integration Costs

Direct or incremental costs related to a business combination transaction are expensed as incurred. Such costs are predominately comprised of severance, retention bonuses payable to employees of an acquired enterprise, temporary employees to assist with the integration of the acquired operations, fees paid for services (such as consulting, accounting, legal, or engineering reviews), and any other costs directly associated with the transaction. These business combination costs are included in "acquisition and integration costs" on the Company's consolidated statement of operations and comprehensive income (loss). For those transactions accounted for as asset acquisitions, these costs are capitalized as part of the purchase price. See note 3 for a discussion of the Company's recent acquisitions.

Stock-Based Compensation

Restricted Stock Units. The Company records stock-based compensation expense only for those unvested restricted stock units ("RSUs") for which the requisite service is expected to be rendered. The cumulative effect of a change in the estimated number of RSUs for which the requisite service is expected to be or has been rendered is recognized in the period of the change in the estimate. To the extent that the requisite service is rendered, compensation cost for accounting purposes is not reversed; rather, it is recognized regardless of whether or not the awards vest. A discussion of the Company's valuation techniques and related assumptions and estimates used to measure the Company's stock-based compensation is as follows:

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

Valuation. The fair value of RSUs without market conditions is determined based on the number of shares relating to such RSUs and the quoted price of the Company's common stock at the date of grant. The Company estimates the fair value of RSUs with market conditions granted using a Monte Carlo simulation. The Company's determination of the fair value of RSUs with market conditions on the date of grant is affected by its common stock price as well as assumptions regarding a number of highly complex or subjective variables. The determination of fair value using a Monte Carlo simulation requires the input of subjective assumptions, and other reasonable assumptions could provide differing results.

Amortization Method. The Company amortizes the fair value of all RSUs on a straight-line basis for each separately vesting tranche of the award (graded vesting schedule) over the requisite service periods.

Expected Volatility. The Company estimates the volatility of its common stock at the date of grant based on the historical volatility of its common stock.

Expected Dividend Rate. The expected dividend rate at the date of grant is based on the then-current dividend yield.

Risk-Free Rate. The Company bases the risk-free rate on the implied yield currently available on U.S. Treasury issues with an equivalent remaining term equal to the expected life of the award.

Forfeitures. The Company uses historical data and management's judgment about the future employee turnover rates to estimate the number of shares for which the requisite service period will not be rendered.

Interest Expense and Amortization of Deferred Financing Costs

The components of interest expense and amortization of deferred financing costs are as follows:

Years Ended December 31,
201820172016
Interest expense on debt obligations$635$582$501
Amortization of deferred financing costs and adjustments on long-term debt, net211919
Capitalized interest(15)(12)(7)
Other122
Total$642$591$515

The Company amortizes deferred financing costs, discounts, premiums, and purchase price adjustments on long-term debt over the estimated term of the related borrowing using the effective interest yield method. Deferred financing costs, discounts or purchase price adjustments are generally presented as a direct reduction to the related debt obligation on the Company's consolidated balance sheet.

Income Taxes

The Company operates as a REIT for U.S. federal income tax purposes. As a REIT, the Company is generally entitled to a deduction for dividends that it pays and therefore is not subject to U.S. federal corporate income tax on its taxable income that is currently distributed to its stockholders. The Company also may be subject to certain federal, state, local, and foreign taxes on its income and assets, including (1) taxes on any undistributed income, (2) taxes related to the TRSs, (3) franchise taxes, (4) property taxes, and (5) transfer taxes. In addition, the Company could in certain circumstances be required to pay an excise or penalty tax, which could be significant in amount, in order to utilize one or more relief provisions under the Internal Revenue Code of 1986, as amended ("Code"), to maintain qualification for taxation as a REIT.

Additionally, the Company has included in TRSs certain other assets and operations. Those TRS assets and operations will continue to be subject, as applicable, to federal and state corporate income taxes or to foreign taxes in the jurisdictions in which such assets and operations are located. The Company's foreign assets and operations (including its tower operations in Puerto Rico) are subject to foreign income taxes in the jurisdictions in which such assets and operations are located, regardless of whether they are included in a TRS or not. For its REIT conversion and certain subsequent acquisitions into the REIT, the Company will be subject to a federal corporate level tax rate (currently 21%) on any gain recognized from the sale of assets occurring within a specified period (generally 5 years) after the transfer date up to the amount of the built in gain that existed on the transfer date, which is based upon the fair market value of those assets in excess of the Company's tax basis on the transfer date. This gain can be offset by any remaining federal net operating loss carryforwards ("NOLs").

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

For the Company's TRSs, the Company accounts for income taxes using an asset and liability approach, which requires the recognition of deferred income tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company's financial statements or tax returns. Deferred income tax assets and liabilities are determined based on the temporary differences between the financial statement and tax bases of assets and liabilities using enacted tax rates. A valuation allowance is provided on deferred tax assets if it is determined that it is "more likely than not" that the asset will not be realized. The Company records a valuation allowance against deferred tax assets when it is "more likely than not" that some portion or all of the deferred tax asset will not be realized. The Company reviews the recoverability of deferred tax assets each quarter and based upon projections of future taxable income, reversing deferred tax liabilities or other known events that are expected to affect future taxable income, records a valuation allowance for assets that do not meet the "more likely than not" realization threshold. Valuation allowances may be reversed if related deferred tax assets are deemed realizable based upon changes in facts and circumstances that impact the recoverability of the asset.

The Company recognizes a tax position if it is "more likely than not" that it will be sustained upon examination. The tax position is measured at the largest amount that is greater than 50 percent likely of being realized upon ultimate settlement. The Company reports penalties and tax-related interest expense as a component of the benefit (provision) for income taxes. As of December 31, 2018 and 2017, the Company has not recorded any material penalties related to its income tax positions.

See note 10.

Per Share Information

Basic net income (loss) attributable to CCIC common stockholders, per common share excludes dilution and is computed by dividing net income (loss) attributable to CCIC common stockholders by the weighted-average number of common shares outstanding during the period. For the years ended December 31, 2018 and 2017 diluted net income (loss) attributable to CCIC common stockholders, per common share is computed by dividing net income (loss) attributable to CCIC common stockholders by the weighted-average number of common shares outstanding during the period plus any potential dilutive common share equivalents, including shares issuable upon (1) the vesting of RSUs as determined under the treasury stock method and (2) conversion of the Company's 6.875% Mandatory Convertible Preferred Stock, Series A, par value $0.01 per share ("6.875% Convertible Preferred Stock"), as determined under the if-converted method. For the year ended December 31, 2016, diluted income (loss) attributable to CCIC common stockholders, per common share is computed by dividing net income (loss) attributable to CCIC common stockholders by the weighted-average number of common shares outstanding during the period plus any potential dilutive common share equivalents, including shares issuable upon (1) the vesting of RSUs as determined under the treasury stock method and (2) conversion of the Company's then outstanding 4.50% Mandatory Convertible Preferred Stock, Series A, par value $0.01 per share ("4.50% Convertible Preferred Stock"), as determined under the if-converted method.

A reconciliation of the numerators and denominators of the basic and diluted per share computations is as follows:

Years Ended December 31,
201820172016
Net income (loss) attributable to CCIC stockholders$671$445$357
Dividends on preferred stock(113)(58)(33)
Net income (loss) attributable to CCIC common stockholders for basic and diluted computations$558$387$324
Weighted-average number of common shares outstanding (in millions):
Basic weighted-average number of common stock outstanding413382340
Effect of assumed dilution from potential issuance of common shares relating to RSUs211
Diluted weighted-average number of common shares outstanding415383341
Net income (loss) attributable to CCIC common stockholders, per common share:
Basic$1.35$1.01$0.95
Diluted$1.34$1.01$0.95
Dividends/distributions declared per share of common stock$4.28$3.90$3.61

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

For each of the years ended December 31, 2018 and 2017, 15 million common share equivalents related to the 6.875% Convertible Preferred Stock were excluded from the dilutive common shares because the impact of the conversion of such preferred stock would be anti-dilutive based on the Company's common stock price at the end of each respective year. See notes 11 and 12.

Fair Values

The Company's assets and liabilities recorded at fair value are categorized based upon a fair value hierarchy that ranks the quality and reliability of the information used to determine fair value. The three levels of the fair value hierarchy are (1) Level 1 — quoted prices (unadjusted) in active and accessible markets, (2) Level 2 — observable prices that are based on inputs not quoted in active markets but corroborated by market data, and (3) Level 3 — unobservable inputs and are not corroborated by market data. The Company evaluates fair value hierarchy level classifications quarterly, and transfers between levels are effective at the end of the quarterly period.

The fair value of cash and cash equivalents and restricted cash approximate the carrying value. The Company determines the fair value of its debt securities based on indicative quotes (that is non-binding quotes) from brokers that require judgment to interpret market information including implied credit spreads for similar borrowings on recent trades or bid/ask prices or quotes from active markets if applicable. Foreign currency swaps are valued at settlement amounts using observable exchange rates and, if material, reflect an adjustment for the Company's and contract counterparty's credit risk. There were no changes since December 31, 2017 in the Company's valuation techniques used to measure fair values. See note 9 for a further discussion of fair values.

Recently Adopted Accounting Pronouncements

In May 2014, the FASB released updated guidance regarding the recognition of revenue from contracts with customers not otherwise addressed by specific guidance (commonly referred to as "ASC 606" or "the revenue recognition standard"). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: (1) identify the contracts with the customer; (2) identify the performance obligations in the contract; (3) determine the contract price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. This guidance was effective for the Company on January 1, 2018. This guidance was required to be applied, at the Company's election, either (1) retrospectively to each prior reporting period presented or (2) under the modified retrospective method, with the cumulative effect being recognized at the date of initial application.

Given the nature of the Company’s contracts with tenants, the Company’s pattern of revenue recognition was not impacted by the adoption of the revenue recognition standard. The Company adopted the revenue recognition standard under the modified retrospective method, and the Company's adoption of the revenue recognition standard did not result in any adjustment to the balance of dividends/distributions in excess of earnings as of January 1, 2018.

See "Revenue Recognition" above and note 4 for further discussion regarding the Company’s revenues.

In November 2016, the FASB issued new guidance which requires an entity's statement of cash flows to explain the change in restricted cash and restricted cash equivalents in addition to the change in cash and cash equivalents. This new guidance also requires an entity that includes cash, cash equivalents, restricted cash and restricted cash equivalents on multiple lines on its balance sheet to present a reconciliation of those line items between its statement of cash flows and its balance sheet. The Company adopted this guidance retrospectively, on January 1, 2018, and the impact of the new guidance is limited to certain changes in presentation on the consolidated statement of cash flows and certain disclosures. See note 16.

In January 2017, the FASB issued new guidance which clarifies the definition of a business in order to assist companies in evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The Company adopted the guidance on January 1, 2018, and the adoption of this guidance did not have a material impact on its consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

In February 2016, the FASB issued new guidance on the recognition, measurement, presentation and disclosure of leases. The new guidance requires lessees to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments for all leases with a term greater than 12 months. The accounting for lessors remains largely unchanged from existing guidance.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

This guidance was effective for, and adopted by, the Company as of January 1, 2019, and was required to be adopted using a modified retrospective approach, which after certain additional updates in July 2018, allowed the Company to apply the new guidance either (1) as of the beginning of the earliest period presented, or (2) as of the effective date (i.e., January 1, 2019), without adjusting the comparative periods.

The Company adopted the new guidance using a modified retrospective approach as of the effective date (i.e., January 1, 2019), without adjusting the comparative periods. The Company's adoption of the new guidance did not result in a cumulative-effect adjustment being recognized to the opening balance of retained earnings. The Company elected the package of practical expedients upon adoption and thus did not reassess the classification or lease term of leases existing prior to January 1, 2019.

When its first quarter 2019 results are reported, the Company expects that (1) the vast majority of its lessor and lessee arrangements will continue to be classified as operating leases under the new guidance; (2) this guidance will result in a lease liability as of March 31, 2019 ranging between $5 billion and $7 billion (which primarily consist of ground leases under the Company's towers and fiber-related leases) and a corresponding right-of-use asset; and (3) there will not be a material impact to its consolidated statement of operations and consolidated statement of cash flows. The Company is in the process of updating certain of its existing information technology systems for both the Towers and Fiber segments to integrate the new lease guidance requirements.

3.Acquisitions

2016 TDC Acquisition

In April 2016, the Company acquired Tower Development Corporation ("TDC"), a portfolio of approximately 330 towers, for approximately $461 million in cash ("TDC Acquisition"). The Company financed the acquisition with cash on hand, cash from borrowings under the Company's senior unsecured revolving credit facility ("2016 Revolver"), and cash from equity issuances under the 2015 ATM Program (see note 11). The final purchase price allocation was primarily comprised of tenant relationships of approximately $140 million, property and equipment of approximately $107 million, and goodwill of approximately $211 million.

2017 FiberNet Acquisition

On November 1, 2016, the Company announced that it had entered into a definitive agreement to acquire FPL FiberNet Holdings, LLC and certain other subsidiaries of NextEra Energy, Inc. (collectively, "FiberNet") for approximately $1.5 billion in cash, subject to certain limited adjustments ("FiberNet Acquisition"). FiberNet is a fiber services provider in Florida and Texas that, as of the agreement date, owned or had rights to approximately 11,500 route miles of fiber installed or under construction, inclusive of approximately 6,000 route miles in top metro markets. On January 17, 2017, the Company closed the FiberNet Acquisition, which was financed using proceeds from its November 2016 Common Stock Offering (as defined in note 11) and borrowings under the 2016 Revolver (see note 8).

The final purchase price allocation for the FiberNet Acquisition is shown below.

Final Purchase Price Allocation
Current assets$52
Property and equipment438
Goodwill(a)778
Other intangible assets, net(b)327
Other non-current assets2
Current liabilities(41)
Other non-current liabilities(35)
Net assets acquired(c)$1,521
(a)The final purchase price allocation for the FiberNet Acquisition resulted in the recognition of goodwill based on:
•the Company's expectation to leverage the FiberNet fiber footprint to support new small cells and fiber solutions,
•the complementary nature of the FiberNet fiber to the Company's existing fiber assets and its location in top metro markets where the Company expects to see wireless carrier network investments,
•the Company's belief that the acquired fiber assets are well-positioned to benefit from the continued growth trends in the demand for data, and
•other intangibles not qualified for separate recognition, including the assembled workforce.
(b)Predominantly comprised of site rental contracts and tenant relationships.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

(c)The vast majority of the assets have been included in the Company's REIT. As such, no deferred taxes were recorded in connection with the FiberNet Acquisition.

2017 Wilcon Acquisition

On April 17, 2017, the Company announced that it had entered into a definitive agreement to acquire Wilcon Holdings LLC ("Wilcon") from Pamlico Holdings and other unit holders of Wilcon for approximately $600 million in cash, subject to certain limited adjustments ("Wilcon Acquisition"). Wilcon is a fiber services provider that owns approximately 1,900 route miles of fiber, primarily in Los Angeles and San Diego. On June 26, 2017, the Company closed the Wilcon Acquisition, which was financed using proceeds from the May 2017 Common Stock Offering (as defined in note 11) and the 4.750% Senior Notes (as defined in note 8) offering.

The final purchase price of approximately $600 million was primarily comprised of other intangible assets (predominantly comprised of site rental contracts and tenant relationships) of approximately $140 million, property and equipment of approximately $150 million, goodwill of approximately $360 million, offset by deferred revenues of approximately $40 million.

The final purchase price allocation for the Wilcon Acquisition resulted in the recognition of goodwill based on (1) the Company's expectation to leverage the Wilcon fiber footprint to support new small cells and fiber solutions, (2) the complementary nature of the Wilcon fiber to the Company's existing fiber assets and its location primarily in Los Angeles and San Diego, where the Company expects to see wireless carrier network investments, (3) the Company's belief that the acquired fiber assets are well positioned to benefit from the continued growth trends in the demand for data, and (4) other intangibles not qualified for separate recognition, including the assembled workforce.

2017 Lightower Acquisition

On July 18, 2017, the Company announced that it had entered into a definitive agreement to acquire LTS Group Holdings LLC ("Lightower") from Berkshire Partners, Pamlico Capital and other investors for approximately $7.1 billion in cash, subject to certain limited adjustments ("Lightower Acquisition"). Lightower owns or has rights to approximately 32,000 route miles of fiber located primarily in top metro markets in the Northeast, including Boston, New York and Philadelphia. On November 1, 2017, the Company closed the Lightower Acquisition, which was financed using (1) cash on hand, including proceeds from the July 2017 Equity Offerings (as defined in note 11) and the August 2017 Senior Notes (as defined in note 8) offering, and (2) borrowings under the 2016 Revolver.

The final purchase price allocation for the Lightower Acquisition is shown below.

Final Purchase Price Allocation
Current assets$99
Property and equipment2,194
Goodwill(a)3,171
Other intangible assets, net(b)2,177
Other non-current assets27
Current liabilities(176)
Other non-current liabilities(342)
Net assets acquired(c)$7,150
(a)The final purchase price allocation for the Lightower Acquisition resulted in the recognition of goodwill based on:
•the Company's expectation to leverage the Lightower fiber footprint to support new small cells and fiber solutions,
•the complementary nature of the Lightower fiber to the Company's existing fiber assets and its location where the Company expects to see wireless carrier network investments,
•the Company's belief that the acquired fiber assets are well-positioned to benefit from the continued growth trends in the demand for data, and
•other intangibles not qualified for separate recognition, including the assembled workforce.
(b)Predominantly comprised of site rental contracts and tenant relationships.
(c)The vast majority of the assets have been included in the Company's REIT. As such, no deferred taxes were recorded in connection with the Lightower Acquisition.

Actual and Pro Forma Financial Information

Net revenues and net income (loss) attributable to acquisitions completed during the year ended December 31, 2017 are included in the Company's consolidated statements of operations and comprehensive income (loss), since the respective date each

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

acquisition was completed. For the year ended December 31, 2017, the FiberNet Acquisition, Wilcon Acquisition and Lightower Acquisition (collectively, "2017 Acquisitions") resulted in an increase to consolidated net revenues of $314 million.

The unaudited pro forma financial results for the years ended December 31, 2017 and 2016 combine the historical results of the Company, along with the historical results of the 2017 Acquisitions for the respective periods. The following table presents the unaudited pro forma consolidated results of operations of the Company as if each acquisition was completed as of January 1, 2016 for the periods presented below. The unaudited pro forma amounts are presented for illustrative purposes only and are not necessarily indicative of future consolidated results of operations.

Twelve Months Ended December 31,
20172016
Net revenues$5,050$4,865
Income (loss) before income taxes$541(b)(c)$367(b)(c)(d)
Benefit (provision) for income taxes$(29)(a)$(21)(a)
Net income (loss)$512(b)(c)$346(b)(c)(d)
Basic net income (loss) attributable to CCIC common stockholders, per common share$0.89(c)(e)$0.51(c)(e)
Diluted net income (loss) attributable to CCIC common stockholders, per common share$0.88(c)(e)$0.51(c)(e)
(a)For the years ended December 31, 2017 and 2016, amounts are inclusive of pro forma adjustments to the benefit (provision) for income tax as a result of the Company's REIT status. The vast majority of the assets and related income from the FiberNet Acquisition, the Wilcon Acquisition, and the Lightower Acquisition are included in the Company's REIT. The remaining assets are included in the Company's TRS. For purposes of the unaudited pro forma financial results, an adjustment has been made to reflect the additional tax impact of the income related to the TRS assets.
(b)For the years ended December 31, 2017 and 2016, amounts are inclusive of pro forma adjustments to depreciation and amortization of $247 million and $316 million, respectively, related to property and equipment and intangibles recorded as a result of the 2017 Acquisitions.
(c)Pro forma amounts include the impact of the interest expense and common stock share issuances associated with the related debt and equity financings for the 2017 Acquisitions (see above and notes 8 and 11).
(d)Amounts are inclusive of a total of $120 million of Lightower stock-based compensation expense and acquisition and integration costs.
(e)Pro forma amounts include the impact of the preferred stock dividends related to the Mandatory Convertible Preferred Stock Offering (as defined in note 11) for the Lightower Acquisition (see above and note 11).
4.Revenues

The following table is a summary of the contracted amounts owed to the Company by tenants pursuant to site rental contracts in effect as of December 31, 2018. As of December 31, 2018, the weighted-average remaining term of tenant contracts is approximately five years, exclusive of renewals at the tenant's option.

Years ending December 31,
20192020202120222023ThereafterTotal
Contracted amounts$3,968$3,761$3,552$3,317$2,587$6,229$23,414
5.Property and Equipment

The major classes of property and equipment are as follows:

Estimated Useful LivesAs of December 31,
20182017
Land(a)—$1,981$1,859
Buildings40 years134119
Communications infrastructure assets1-20 years18,70917,184
Information technology assets and other2-7 years443372
Construction in process—975899
Total gross property and equipment22,24220,433
Less: accumulated depreciation(8,566)(7,500)
Total property and equipment, net$13,676$12,933
(a)Includes land owned in fee and perpetual easements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

Depreciation expense for the years ended December 31, 2018, 2017 and 2016 was $1.1 billion, $915 million and $833 million, respectively. Capital leases and associated leasehold improvements related to gross property and equipment, and accumulated depreciation was $4.4 billion and $1.9 billion, respectively, as of December 31, 2018. See notes 1 and 2, including discussion of the Company's prepaid master lease agreements.

6.Goodwill and Intangible Assets

Goodwill

The changes in the carrying value of goodwill for the years ended December 31, 2018 and December 31, 2017 were as follows:

Balance as of December 31, 2016$5,758
Additions due to FiberNet Acquisition(a)778
Additions due to Wilcon Acquisition(a)358
Additions due to Lightower Acquisition(a)3,115
Adjustments due to other acquisitions, purchase price allocations and other, net12
Balance as of December 31, 2017$10,021
Adjustments due to other acquisitions, purchase price allocations and other, net57
Balance as of December 31, 2018$10,078
(a)The final purchase price allocations for the FiberNet Acquisition, Wilcon Acquisition and Lightower Acquisition resulted in the recognition of goodwill in the Fiber segment based on:
•the Company's expectation to leverage the FiberNet, Wilcon and Lightower fiber footprint to support new small cells and fiber solutions,
•the complementary nature of the FiberNet, Wilcon and Lightower fiber to the Company's existing fiber assets and its location where the Company expects to see wireless carrier network investments,
•the Company's belief that the acquired fiber assets are well-positioned to benefit from the continued growth trends in the demand for data, and
•other intangibles not qualified for separate recognition, including the assembled workforce. See note 3.

Intangibles

The following is a summary of the Company's intangible assets. See note 3 for further discussion of the Company's acquisitions.

As of December 31, 2018As of December 31, 2017
Gross Carrying Value(a)Accumulated AmortizationNet Book ValueGross Carrying ValueAccumulated AmortizationNet Book Value
Site rental contracts and tenant relationships$7,787$(2,578)$5,209$7,782$(2,156)$5,626
Other intangible assets494(187)307504(168)336
Total$8,281$(2,765)$5,516$8,286$(2,324)$5,962
(a)During the year ended December 31, 2018, intangible assets additions (primarily site rental contracts and tenant relationships) from acquisitions had a weighted average amortization period of approximately 20 years.

Amortization expense related to intangible assets is classified as follows on the Company's consolidated statement of operations and comprehensive income (loss):

For Years Ended December 31,
Classification201820172016
Depreciation, amortization and accretion$428$314$265
Site rental costs of operations171819
Total amortization expense$445$332$284

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

The estimated annual amortization expense related to intangible assets (inclusive of those recorded as an increase to "site rental costs of operations") for the years ending December 31, 2019 to 2023 is as follows:

Years Ending December 31,
20192020202120222023
Estimated annual amortization$445$444$444$443$443
7.Other Liabilities

Other long-term liabilities

The following is a summary of the components of "other long-term liabilities" as presented on the Company's consolidated balance sheet. See also note 2.

December 31,
20182017
Deferred rental revenues$1,267$1,077
Deferred ground lease payable603560
Above market leases for land interests, net181202
Deferred credits, net499532
Asset retirement obligation192174
Deferred income tax liabilities75
Other long-term liabilities104
Total$2,759$2,554

Pursuant to its ground lease, easement and leased facility agreements, the Company has the obligation to perform certain asset retirement activities, including requirements upon contract termination to remove communications infrastructure or remediate the space upon which its communications infrastructure resides. Accretion expense related to liabilities for retirement obligations amounted to $14 million, $13 million and $11 million for the years ended December 31, 2018, 2017, and 2016, respectively. As of December 31, 2018 and 2017, liabilities for retirement obligations were $192 million and $174 million, respectively, representing the net present value of the estimated expected future cash outlay. As of December 31, 2018, the estimated undiscounted future cash outlay for asset retirement obligations was approximately $1.1 billion. See note 2.

For the years ended December 31, 2018, 2017 and 2016, the Company recorded $18 million, $19 million and $21 million, respectively, as a decrease to "site rental costs of operations" for the amortization of above-market leases for land interests under the Company's towers. The estimated amortization expense related to above-market leases for land interests under the Company's towers recorded to site rental costs of operations for the years ending December 31, 2019 to 2023 is as follows:

Years Ending December 31,
20192020202120222023
Above-market leases for land interests$17$16$15$14$13

For the years ended December 31, 2018, 2017 and 2016, the Company recognized $69 million, $37 million and $34 million, respectively, in "site rental revenues" related to the amortization of below market tenant leases. The following table summarizes the estimated annual amounts related to below-market tenant leases expected to be amortized into site rental revenues for the years ending December 31, 2019 to 2023 are as follows:

Years Ending December 31,
20192020202120222023
Below-market tenant leases$62$55$52$47$43

Other accrued liabilities

Other accrued liabilities included accrued payroll and other accrued compensation of $157 million and $141 million, respectively, as of December 31, 2018 and 2017.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

8.Debt and Other Obligations

See note 18 for a discussion of the Company's issuance of the February 2019 Senior Notes (as defined in note 18) and the application of the net proceeds therefrom.

The table below sets forth the Company's debt and other obligations as of December 31, 2018.

Original Issue DateContractual Maturity DateOutstanding Balance as of December 31,Stated Interest Rate as of December 31,
201820172018(a)
Tower Revenue Notes, Series 2010-3Jan. 2010Jan. 2040(b)(c)—1,246N/A
Tower Revenue Notes, Series 2010-6Aug. 2010Aug. 2040(b)(c)—995N/A
Tower Revenue Notes, Series 2015-1May 2015May 2042(b)(c)2982973.2%
Tower Revenue Notes, Series 2015-2May 2015May 2045(b)(c)6936923.7%
Tower Revenue Notes, Series 2018-1July 2018July 2043(b)(c)247—3.7%
Tower Revenue Notes, Series 2018-2July 2018July 2048(b)(c)742—4.2%
3.849% Secured NotesDec. 2012Apr. 20239949933.9%
Secured Notes, Series 2009-1, Class A-1Jul. 2009Aug. 2019(d)12326.3%
Secured Notes, Series 2009-1, Class A-2Jul. 2009Aug. 2029(d)70709.0%
Capital leases and other obligationsVariousVarious(e)227227Various
Total secured debt$3,283$4,552
2016 RevolverJan. 2016June 20231,075(f)9803.8%(g)
2016 Term Loan AJan. 2016June 20232,3542,3973.8%(g)
5.250% Senior NotesOct. 2012Jan. 20231,6411,6395.3%
4.875% Senior NotesApr. 2014Apr. 20228448424.9%
3.400% Senior NotesFeb./May 2016Feb. 20218508503.4%
4.450% Senior NotesFeb. 2016Feb. 20268928914.5%
3.700% Senior NotesMay 2016June 20267447433.7%
2.250% Senior NotesSept. 2016Sept. 20216976952.3%
4.000% Senior NotesFeb. 2017Mar. 20274944944.0%
4.750% Senior NotesMay 2017May 20473433434.8%
3.200% Senior NotesAug. 2017Sept. 20247437423.2%
3.650% Senior NotesAug. 2017Sept. 20279929913.7%
3.150% Senior NotesJan. 2018July 2023742—3.2%
3.800% Senior NotesJan. 2018Feb. 2028988—3.8%
Total unsecured debt$13,399$11,607
Total debt and other obligations16,68216,159
Less: current maturities and short-term debt and other current obligations107115
Non-current portion of long-term debt and other long-term obligations$16,575$16,044
(a)Represents the weighted-average stated interest rate.
(b)The Tower Revenue Notes, Series 2010-3 ("January 2010 Tower Revenue Notes"), Tower Revenue Notes, Series 2010-6 ("August 2010 Tower Revenue Notes"), Tower Revenue Notes, Series 2015-1 and 2015-2 ("May 2015 Tower Revenue Notes") and Tower Revenue Notes, Series 2018-1 and 2018-2 ("July 2018 Tower Revenue Notes") are collectively referred to herein as "Tower Revenue Notes."
(c)If the respective series of Tower Revenue Notes are not paid in full on or prior to an applicable anticipated repayment date, then Excess Cash Flow (as defined in the indenture) of the issuers of such notes will be used to repay principal of the applicable series and class of the Tower Revenue Notes, and additional interest (of an additional approximately 5% per annum) will accrue on the respective Tower Revenue Notes. As of December 31, 2018, the Tower Revenue Notes have principal amounts of $300 million, $250 million, $700 million and $750 million, with anticipated repayment dates in 2022, 2023, 2025 and 2028, respectively.
(d)The Secured Notes, Series 2009-1, Class A-1 and Secured Notes, Series 2009-1, Class A-2 are collectively referred to herein as "2009 Securitized Notes."
(e)The Company's capital leases and other obligations relate to land, fiber, vehicles, and other assets and bear interest rates ranging up to 10% and mature in periods ranging from less than one year to approximately 30 years.
(f)As of December 31, 2018, the undrawn availability under the 2016 Revolver was $3.2 billion. See note 18.
(g)The 2016 Revolver and senior unsecured term loan A facility ("2016 Term Loan A") bear interest at a rate per annum equal to LIBOR plus a credit spread ranging from 1.000% to 1.750%, based on the Company's senior unsecured debt rating. The Company pays a commitment fee ranging from 0.125% to 0.350%, based on the Company's senior unsecured debt rating, per annum on the undrawn available amount under the 2016 Revolver.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

The credit agreement governing the Company's 2016 Credit Facility contains financial maintenance covenants. The Company is currently in compliance with these financial maintenance covenants, and based upon current expectations, the Company believes it will continue to comply with its financial maintenance covenants. In addition, certain of the Company's debt agreements also contain restrictive covenants that place restrictions on CCIC or its subsidiaries and may limit the Company's ability to, among other things, incur additional debt and liens, purchase the Company's securities, make capital expenditures, dispose of assets, undertake transactions with affiliates, make other investments, pay dividends or distribute excess cash flow.

Bank Debt

In January 2016, the Company completed the 2016 Credit Facility, which was originally comprised of (1) a $2.5 billion 2016 Revolver maturing in January 2021, (2) a $2.0 billion 2016 Term Loan A maturing in January 2021 and (3) a $1.0 billion senior unsecured 364-day revolving credit facility ("364-Day Facility") maturing in January 2017. The Company used the net proceeds from the 2016 Credit Facility (1) to repay the then outstanding 2012 Credit Facility and (2) for general corporate purposes. In February 2016, the Company used a portion of the net proceeds from the February 2016 Senior Notes (as defined below) offering to repay in full all outstanding borrowings under the then outstanding 364-Day Facility.

In February 2017, the Company entered into an amendment to the 2016 Credit Facility to (1) incur additional term loans in an aggregate principal amount of $500 million and (2) extend the maturity of both the 2016 Term Loan A and the 2016 Revolver to January 2022.

In August 2017, the Company entered into an amendment to the 2016 Credit Facility to (1) increase the commitments under the 2016 Revolver by $1.0 billion, for total commitments of $3.5 billion and (2) extend the maturity of the Credit Facility to August 2022.

In June 2018, the Company entered into an amendment to the 2016 Credit Facility to (1) increase the commitments under the 2016 Revolver by $750 million for total commitments of $4.25 billion and (2) extend the maturity of the 2016 Credit Facility from August 2022 to June 2023.

Securitized Debt

The Tower Revenue Notes and the 2009 Securitized Notes (collectively, "Securitized Debt") are obligations of special purpose entities and their direct and indirect subsidiaries (each an "issuer"), all of which are wholly-owned, indirect subsidiaries of CCIC. The Tower Revenue Notes and 2009 Securitized Notes are governed by separate indentures. The May 2015 Tower Revenue Notes and July 2018 Tower Revenue Notes are governed by one indenture and consist of multiple series of notes, each with its own anticipated repayment date.

The net proceeds of the January 2010 Tower Revenue Notes and August 2010 Tower Revenue Notes were primarily used to repay the portion of the 2005 Tower Revenue Notes and 2006 Tower Revenue Notes not previously purchased. In April 2014, the Company utilized a portion of the net proceeds from the 4.875% Senior Notes (as defined below) offering to repay $300 million of the January 2010 Tower Revenue Notes which had an anticipated repayment date of January 2015.

The net proceeds of the May 2015 Tower Revenue Notes, together with proceeds received from the Company's sale of CCAL, were primarily used to (1) repay $250 million aggregate principal amount of August 2010 Tower Revenue Notes which had an anticipated repayment date of August 2015, (2) repay all of the then outstanding WCP Secured Wireless Site Contracts Revenue Notes, Series 2010-1 ("WCP Securitized Notes"), (3) repay portions of outstanding borrowings under the 2012 Credit Facility and (4) pay related fees and expenses.

In July 2018, the Company issued $1.0 billion aggregate principal amount of Senior Secured Tower Revenue Notes ("July 2018 Tower Revenue Notes"), which were issued pursuant to the existing indenture and have similar terms and security as the Company's existing Tower Revenue Notes. The July 2018 Tower Revenue Notes consist of (1) $250 million aggregate principal amount of 3.720% senior secured tower revenue notes ("3.72% Notes") with an anticipated repayment date of July 2023 and a final maturity of July 2043 and (2) $750 million aggregate principal amount of 4.241% senior secured tower revenue notes ("4.241% Notes") with an anticipated repayment date of July 2028 and a final maturity of July 2048. The Company used the net proceeds of the July 2018 Tower Revenue Notes, together with cash on hand, to repay all of the previously outstanding Tower Revenue Notes, Series 2010-6 and to pay related fees and expenses. In addition to the July 2018 Tower Revenue Notes described above, in connection with Exchange Act risk retention requirements ("Risk Retention Rules"), an indirect subsidiary of the Company issued and a majority-owned affiliate of the Company purchased approximately $53 million of the Senior Secured Tower Revenue Notes, Series 2018-1, Class R-2028 to retain an eligible horizontal residual interest (as defined in the Risk Retention Rules) in an amount equal to at least 5% of the fair value of the July 2018 Tower Revenue Notes.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

The Securitized Debt is paid solely from the cash flows generated by the operation of the towers held directly and indirectly by the issuers of the respective Securitized Debt. The Securitized Debt is secured by, among other things, (1) a security interest in substantially all of the applicable issuers' assignable personal property, (2) a pledge of the equity interests in each applicable issuer and (3) a security interest in the applicable issuers' leases with tenants to lease tower space (space licenses). The governing instruments of two indirect subsidiaries ("Crown Atlantic" and "Crown GT") of the issuers of the Tower Revenue Notes generally prevent them from issuing debt and granting liens on their assets without the approval of a subsidiary of Verizon Communications. Consequently, while distributions paid by Crown Atlantic and Crown GT will service the Tower Revenue Notes, the Tower Revenue Notes are not obligations of, nor are the Tower Revenue Notes secured by the cash flows or any other assets of, Crown Atlantic and Crown GT. As of December 31, 2018, the Securitized Debt was collateralized with personal property and equipment with an aggregate net book value of approximately $1.0 billion, exclusive of Crown Atlantic and Crown GT personal property and equipment.

The excess cash flows from the issuers of the Securitized Debt, after the payment of principal, interest, reserves, expenses and management fees, are distributed to the Company in accordance with the terms of the indentures. If the Debt Service Coverage Ratio ("DSCR") (as defined in the applicable governing loan agreement) as of the end of any calendar quarter falls to a certain level, then all excess cash flow of the issuers of the applicable debt instrument will be deposited into a reserve account instead of being released to the Company. The funds in the reserve account will not be released to the Company until the DSCR exceeds a certain level for two consecutive calendar quarters. If the DSCR falls below a certain level as of the end of any calendar quarter, then all cash on deposit in the reserve account along with future excess cash flows of the issuers will be applied to prepay the debt with applicable prepayment consideration.

The Company may repay the May 2015 Tower Revenue Notes or the 2009 Securitized Notes in whole or in part at any time after the second anniversary of the applicable issuance date and the July 2018 Tower Revenue Notes from the date of issuance, provided in each case that such prepayment is accompanied by any applicable prepayment consideration. The Securitized Debt has covenants and restrictions customary for rated securitizations, including provisions prohibiting the issuers from incurring additional indebtedness or further encumbering their assets.

Bonds—Senior Notes

In January 2018, the Company issued $750 million aggregate principal amount of 3.150% senior unsecured notes due July 2023 and $1.0 billion aggregate principal amount of 3.800% senior unsecured notes due February 2028 (collectively, "January 2018 Senior Notes"). The Company used the net proceeds of the January 2018 Senior Notes offering to repay (1) in full the January 2010 Tower Revenue Notes and (2) a portion of the outstanding borrowings under the 2016 Revolver.

In February 2017, the Company issued $500 million aggregate principal amount of 4.000% senior unsecured notes due March 2027 ("4.000% Senior Notes"). The Company used the net proceeds from the 4.000% Senior Notes offering to repay a portion of the outstanding borrowings under the 2016 Revolver.

In May 2017, the Company issued $350 million aggregate principal amount of 4.750% senior unsecured notes due May 2047 ("4.750% Senior Notes"). The Company used the net proceeds from the 4.750% Senior Notes offering to partially fund the Wilcon Acquisition and to repay a portion of the outstanding borrowings under the 2016 Revolver.

In August 2017, the Company issued $1.75 billion aggregate principal amount of senior unsecured notes ("August 2017 Senior Notes"), which consisted of (1) $750 million aggregate principal amount of 3.200% senior unsecured notes due September 2024 ("3.200% Senior Notes") and (2) $1.0 billion aggregate principal amount of 3.650% senior unsecured notes due September 2027 ("3.650% Senior Notes"). The Company used the net proceeds from the August 2017 Senior Notes offering to partially fund the Lightower Acquisition and pay related fees and expenses.

In February 2016, the Company issued $1.5 billion aggregate principal amount of senior unsecured notes ("February 2016 Senior Notes"), which consisted of (1) $600 million aggregate principal amount of 3.400% senior notes due February 2021 ("3.400% Senior Notes") and (2) $900 million aggregate principal amount of 4.450% senior unsecured notes due February 2026 ("4.450% Senior Notes"). The Company used the net proceeds from the February 2016 Senior Notes offering, together with cash on hand, to (1) repay in full all outstanding borrowings under the then outstanding 364-Day Facility and (2) repay $500 million of outstanding borrowings under the 2016 Revolver.

In May 2016, the Company issued $1.0 billion aggregate principal amount of senior unsecured notes ("May 2016 Senior Notes"), which consisted of (1) $250 million aggregate principal amount of additional 3.400% Senior Notes pursuant to the same indenture as the 3.400% Senior Notes issued in the February 2016 Senior Notes offering and (2) $750 million aggregate principal amount of 3.700% senior unsecured notes due June 2026 ("3.700% Senior Notes"). The Company used the net proceeds from

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

the May 2016 Senior Notes offering to repay in full the Tower Revenue Notes, Series 2010-2 and Series 2010-5, each issued by certain of its subsidiaries, and to repay a portion of the outstanding borrowings under the 2016 Revolver.

In September 2016, the Company issued $700 million aggregate principal amount of 2.250% senior unsecured notes ("2.250% Senior Notes") due September 2021. The Company used the net proceeds from the 2.250% Senior Notes offering to (1) repay $500 million aggregate principal amount of 2.381% secured notes due 2017 ("2.381% Secured Notes") issued by certain of its subsidiaries and (2) repay a portion of the outstanding borrowings under the 2016 Revolver.

In April 2014, the Company issued $850 million aggregate principal amount of 4.875% senior unsecured notes due April 2022 ("4.875% Senior Notes"). The net proceeds from the offering were approximately $839 million, after the deduction of associated fees. The Company utilized the net proceeds from the 4.875% Senior Notes offering (1) to repay $300 million of the January 2010 Tower Revenue Notes with an anticipated repayment date of January 2015 and (2) to redeem all of the then outstanding 7.125% senior unsecured notes due 2019.

In October 2012, the Company issued $1.65 billion aggregate principal amount of 5.250% senior unsecured notes due 2023 ("5.250% Senior Notes"). The Company used the net proceeds from the 5.250% Senior Notes offering to partially fund the T-Mobile Acquisition.

Each of the February 2016 Senior Notes, May 2016 Senior Notes, 2.250% Senior Notes, 4.875% Senior Notes, 5.250% Senior Notes, 4.000% Senior Notes, 4.750% Senior Notes, August 2017 Senior Notes and January 2018 Senior Notes (collectively, "Senior Notes") are senior unsecured obligations of the Company and rank equally with all of the Company's existing and future senior unsecured indebtedness, including obligations under the 2016 Credit Facility, and senior to all of the Company's future subordinated indebtedness. The Senior Notes are structurally subordinated to all existing and future liabilities and obligations of the Company's subsidiaries. The Company's subsidiaries are not guarantors of the Senior Notes.

CCIC may redeem any of the Senior Notes in whole or in part at any time at a price equal to 100% of the principal amount to be redeemed, plus a make whole premium, if applicable, and accrued and unpaid interest, if any, to the date of redemption.

Bonds—Secured Notes

In December 2012, the Company issued $1.0 billion aggregate principal amount of 3.849% secured notes due 2023 ("3.849% Secured Notes"). The 2012 Secured Notes were issued and are guaranteed by the same subsidiaries of CCIC that had previously issued and guaranteed the 7.750% senior unsecured notes due 2017 ("7.750% Secured Notes"). The 3.849% Secured Notes are secured by a pledge of the equity interests of such subsidiaries. The 3.849% Secured Notes are not guaranteed by and are not obligations of CCIC or any of its subsidiaries other than the issuers and guarantors of the 3.849% Secured Notes. The 3.849% Secured Notes will be paid solely from the cash flows generated from operations of the towers held directly and indirectly by the issuers and the guarantors of such notes. The Company used the net proceeds from the issuance of the 3.849% Secured Notes to repurchase and redeem the then outstanding 7.750% Secured Notes and a portion of the then outstanding 9.000% senior notes due 2011. The 3.849% Secured Notes may be redeemed at any time at a price equal to 100% of the principal amount, plus a make whole premium, and accrued and unpaid interest, if any to the redemption date.

Previously Outstanding Indebtedness

See above for a discussion of the Company's recent redemptions and repayments of debt.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

Contractual Maturities

The following are the scheduled contractual maturities of the total debt or other long-term obligations outstanding at December 31, 2018. These maturities reflect contractual maturity dates and do not consider the principal payments that will commence following the anticipated repayment dates on the Tower Revenue Notes. If the Tower Revenue Notes are not paid in full on or prior to their respective anticipated repayment dates, as applicable, then the Excess Cash Flow (as defined in the indenture) of the issuers of such notes will be used to repay principal of the applicable series and class of the Tower Revenue Notes and additional interest (of an additional approximately 5% per annum) will accrue on the Tower Revenue Notes.

Years Ending December 31,
20192020202120222023ThereafterTotal Cash ObligationsUnamortized Adjustments, NetTotal Debt and Other Obligations Outstanding
Scheduled contractual maturities$107$142$1,702$1,087$6,363$7,390$16,791$(109)$16,682

Debt Purchases and Redemptions

The following is a summary of the purchases and redemptions of debt during the years ended December 31, 2018, 2017 and 2016.

Year Ending December 31, 2018
Principal AmountCash Paid(a)Gains (losses)(b)
Tower Revenue Notes, Series 2010-3$1,250$1,318$(71)
2016 Term Loan A——(3)
Tower Revenues Notes, Series 2010-61,0001,028(32)
Total$2,250$2,346$(106)
(a)Exclusive of accrued interest.
(b)Inclusive of the write off of the respective deferred financing costs.
Year Ending December 31, 2017
Principal AmountCash PaidGains (losses)(a)
2016 Term Loan A$—$—$(4)
Total$—$—$(4)
(a)The losses related to write off of deferred financing costs.
Year Ending December 31, 2016
Principal AmountCash Paid(a)Gains (losses)(b)
Revolving Credit Facility under 2012 Credit Facility$—$—$(2)
Tranche A Term Loans under 2012 Credit Facility629629(2)
Tranche B Term Loans under 2012 Credit Facility2,2472,247(27)
Tower Revenue Notes, Series 2010-2350353(3)
Tower Revenue Notes, Series 2010-5300307(8)
2.381% Secured Notes500509(10)
Total$4,026$4,045$(52)
(a)Exclusive of accrued interest.
(b)Inclusive of the write off of the respective deferred financing costs.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

9.Fair Value Disclosures

The following table shows the estimated fair values of the Company's financial instruments, along with the carrying amounts of the related assets (liabilities). See also note 2.

Level in Fair Value HierarchyDecember 31, 2018December 31, 2017
Carrying AmountFair ValueCarrying AmountFair Value
Assets:
Cash and cash equivalents1$277$277$314$314
Restricted cash1136136126126
Liabilities:
Debt and other obligations2$16,682$16,562$16,159$16,644
10.Income Taxes

Income (loss) from continuing operations before income taxes by geographic area is as follows:

Years Ended December 31,
201820172016
Domestic$667$451$349
Foreign(a)232025
Total$690$471$374
(a)Inclusive of income (loss) before income taxes from Puerto Rico.

The benefit (provision) for income taxes consists of the following:

Years Ended December 31,
201820172016
Current:
Federal$(5)$(3)$—
Foreign(7)(6)(7)
State(5)(2)(1)
Total current(17)(11)(8)
Deferred:
Federal—(18)(8)
Foreign(2)3(1)
Total deferred(2)(15)(9)
Total tax benefit (provision)$(19)$(26)$(17)

A reconciliation between the benefit (provision) for income taxes and the amount computed by applying the federal statutory income tax rate to the income (loss) before income taxes is as follows:

Years Ended December 31,
201820172016
Benefit (provision) for income taxes at statutory rate$(145)$(165)$(131)
Tax effect of foreign income (losses)1—1
Tax adjustment related to REIT operations138159121
State tax (provision) benefit, net of federal(4)(2)(1)
Foreign tax(9)(3)(7)
Effects of tax law change(a)—(15)—
Total$(19)$(26)$(17)
(a)Pursuant to the Tax Cuts and Jobs Act, which was signed into law in December 2017, the Company was required to write down its net federal deferred tax asset in the amount of $17 million as a result of the reduction in the federal corporate tax rate offset by a benefit of $2 million related to the refund of the Company's alternative minimum tax credit carryforward.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

The components of the net deferred income tax assets and liabilities are as follows:

December 31,
20182017
Deferred income tax liabilities:
Property and equipment$5$5
Deferred site rental receivable77
Total deferred income tax liabilities1212
Deferred income tax assets:
Intangible assets45
Net operating loss carryforwards(a)1821
Deferred ground lease payable22
Accrued liabilities55
Other31
Valuation allowances(1)(1)
Total deferred income tax assets, net3133
Net deferred income tax asset (liabilities)$19$21
(a)Balance results from the Company's foreign NOLs. Due to the Company's REIT status, no federal or state NOLs result in the Company recording a deferred income tax asset. See further discussion surrounding the Company's NOL balances below.

The Company operates as a REIT for U.S. federal income tax purposes.

The components of the net deferred income tax assets (liabilities) are as follows:

December 31, 2018December 31, 2017
ClassificationGrossValuation AllowanceNetGrossValuation AllowanceNet
Federal$25$—$25$25$—$25
State1—11—1
Foreign(6)(1)(7)(4)(1)(5)
Total$20$(1)$19$22$(1)$21

At December 31, 2018, the Company had U.S. federal and state NOLs of approximately $1.5 billion and $0.6 billion, respectively, which are available to offset future taxable income. These amounts include approximately $237 million of losses related to stock-based compensation. The Company also has foreign NOLs of $50 million. If not utilized, the Company's U.S. federal NOLs expire starting in 2025 and ending in 2036, the state NOLs expire starting in 2019 and ending in 2036, and the foreign NOLs expire starting in 2022 and ending in 2037. The utilization of the NOLs is subject to certain limitations. The Company's U.S. federal and state income tax returns generally remain open to examination by taxing authorities until three years after the applicable NOLs have been used or expired. The remaining valuation allowance relates to certain foreign net deferred tax assets (primarily NOLs).

As of December 31, 2018, there were no unrecognized tax benefits that would impact the effective tax rate, if recognized.

From time to time, the Company is subject to examinations by various tax authorities in jurisdictions in which the Company has business operations. At this time, the Company is not subject to an Internal Revenue Service examination. The Australian Taxation Office is conducting an audit of the tax consequences for Australian tax purposes of the Company's sale of CCAL. The Company regularly assesses the likelihood of additional assessments in each of the tax jurisdictions. The Company has no uncertain tax positions as of December 31, 2018. Additionally, the Company does not believe assessments, if any, arising from current or future examination or audits will have a material effect on the Company's financial statements.

As of December 31, 2018, the Company's deferred tax assets are included in "long-term prepaid rent and other assets, net" and the Company's deferred tax liabilities are included in "other long-term liabilities" on the Company's consolidated balance sheet.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

11.Equity

2015 "At-the-Market" Stock Offering Program

The Company previously maintained an "at-the-market" stock offering program through which it had the right to issue and sell shares of its common stock having an aggregate gross sales price of up to $500 million to or through sales agents ("2015 ATM Program"). The Company sold shares of its common stock under the 2015 ATM Program generating aggregate gross proceeds of approximately $350 million. The Company terminated the 2015 ATM Program in March 2018 with shares of its common stock having an aggregate offering price of approximately $150 million remaining unsold.

2018 "At-The-Market" Stock Offering Program

In April 2018, the Company established a new "at-the-market" stock offering program through which it may issue and sell shares of its common stock having an aggregate gross sales price of up to $750 million ("2018 ATM Program"). Sales under the 2018 ATM Program may be made by means of ordinary brokers' transactions on the NYSE or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or, subject to our specific instructions, at negotiated prices. The Company intends to use the net proceeds from any sales under the 2018 ATM Program for general corporate purposes, which (1) may include the funding of future acquisitions or investments or (2) the repayment or repurchase of any outstanding indebtedness. As of December 31, 2018, the Company had $750 million of gross sales of common stock availability remaining under the 2018 ATM Program.

May 2017 Common Stock Offering

On May 1, 2017, the Company completed an offering of 4.75 million shares of its common stock, which generated net proceeds of approximately $442 million ("May 2017 Common Stock Offering"). The Company used the net proceeds of the May 2017 Common Stock Offering to partially fund the Wilcon Acquisition.

July 2017 Equity Offerings

On July 26, 2017, the Company completed an offering of 40.15 million shares of common stock, including certain additional shares sold pursuant to the underwriters' option, which generated net proceeds of approximately $3.8 billion ("July 2017 Common Stock Offering"). The Company used the net proceeds of the July 2017 Common Stock Offering to partially fund the Lightower Acquisition and pay related fees and expenses.

On July 26, 2017, the Company completed an offering of 1.65 million shares of the Company's 6.875% Convertible Preferred Stock, at $1,000 per share, including certain additional shares sold pursuant to the underwriters' option, which generated net proceeds of approximately $1.6 billion ("Mandatory Convertible Preferred Stock Offering"). The Company used the net proceeds from the Mandatory Convertible Preferred Stock Offering to partially fund the Lightower Acquisition and pay related fees and expenses.

The holders of the 6.875% Convertible Preferred Stock are entitled to receive cumulative dividends, when and if declared by the Company's board of directors, at the rate of 6.875% on the liquidation preference of $1,000 per share. The dividends may be paid in cash or, subject to certain limitations, in shares of the Company's common stock or any combination of cash and shares of common stock on February 1, May 1, August 1 and November 1 of each year, commencing on November 1, 2017 and to, and including, August 1, 2020. The terms of the 6.875% Convertible Preferred Stock provide that, unless accumulated dividends have been paid or set aside for payment on all outstanding shares of 6.875% Convertible Preferred Stock for all past dividend periods, no dividends may be declared or paid on common stock.

Unless converted earlier, each outstanding share of the 6.875% Convertible Preferred Stock will automatically convert into shares of the Company's common stock on August 1, 2020 into between 8.7260 and 10.4712 shares of the Company's common stock, depending on the applicable market value of the common stock and subject to certain anti-dilution adjustments. At any time prior to August 1, 2020, holders of the 6.875% Convertible Preferred Stock may elect to convert all or a portion of their shares into common stock at the minimum conversion rate of 8.7260, subject to certain anti-dilution adjustments.

The July 2017 Common Stock Offering and Mandatory Convertible Preferred Stock Offering are collectively referred to herein as "July 2017 Equity Offerings."

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

March 2018 Common Stock Offering

In March 2018, the Company completed an offering of 8 million shares of its common stock, which generated net proceeds of $841 million ("March 2018 Equity Financing"). The Company used the net proceeds from the March 2018 Equity Financing for general corporate purposes, including repayment of outstanding indebtedness.

Declaration and Payment of Dividends

During the year ended December 31, 2018, the following dividends were declared or paid:

Equity TypeDeclaration DateRecord DatePayment DateDividends Per ShareAggregate Payment Amount (In millions)
Common StockFebruary 21, 2018March 16, 2018March 30, 2018$1.05$439(a)
Common StockMay 17, 2018June 15, 2018June 29, 2018$1.05$438(a)
Common StockAugust 2, 2018September 14, 2018September 28, 2018$1.05$438(a)
Common StockOctober 15, 2018December 14, 2018December 31, 2018$1.125$467(a)
6.875% Convertible Preferred StockDecember 15, 2017January 15, 2018February 1, 2018$17.1875$28
6.875% Convertible Preferred StockMarch 19, 2018April 15, 2018May 1, 2018$17.1875$28
6.875% Convertible Preferred StockJune 22, 2018July 15, 2018August 1, 2018$17.1875$28
6.875% Convertible Preferred StockSeptember 19, 2018October 15, 2018November 1, 2018$17.1875$28
6.875% Convertible Preferred StockDecember 11, 2018January 15, 2019February 1, 2019$17.1875$28
(a)Inclusive of dividends accrued for holders of unvested RSUs, which will be paid when and if the RSUs vest.

See note 18 for further discussion of common stock dividends.

Tax Treatment of Dividends

The following table summarizes, for income tax purposes, the nature of dividends paid during 2018 on the Company's common stock and 6.875% Convertible Preferred Stock.

Equity TypePayment DateCash Distribution (per share)Ordinary Taxable Dividend (per share)Qualified Taxable Dividend (per share)(a)Section 199A Dividend (per share)Non-Taxable Distribution (per share)
Common StockMarch 30, 2018$1.05$0.689$0.005$0.684$0.361
Common StockJune 29, 2018$1.05$0.689$0.005$0.684$0.361
Common StockSeptember 28, 2018$1.05$0.689$0.005$0.684$0.361
Common StockDecember 31, 2018$1.125$0.738$0.005$0.733$0.387
6.875% Convertible Preferred StockFebruary 1, 2018$17.1875$17.1875$0.1269$17.0606$—
6.875% Convertible Preferred StockMay 1, 2018$17.1875$17.1875$0.1269$17.0606$—
6.875% Convertible Preferred StockAugust 1, 2018$17.1875$17.1875$0.1269$17.0606$—
6.875% Convertible Preferred StockNovember 1, 2018$17.1875$17.1875$0.1269$17.0606$—
(a)Qualified taxable dividend and section 199A dividend amounts are included in ordinary taxable dividend amounts.

Purchases of the Company's Common Stock

During each of the years ended December 31, 2018, 2017 and 2016, the Company purchased 0.3 million shares of common stock utilizing $34 million, $23 million and $25 million in cash, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

12.Stock-based Compensation

Stock Compensation Plans

Pursuant to a stockholder approved plan, the Company has and is permitted to grant stock-based awards to certain employees, consultants or non-employee directors of the Company and its subsidiaries or affiliates. As of December 31, 2018, the Company has 10 million shares available for future issuance pursuant to its 2013 Long-Term Incentive Plan ("LTI Plan"). Of these shares remaining available for future issuance, approximately 3 million may be issued pursuant to outstanding RSUs granted under the LTI Plan.

Restricted Stock Units

The Company issues RSUs to certain executives and employees; each RSU represents a contingent right to receive one share of common stock subject to satisfaction of the applicable vesting terms. The RSUs granted to certain executives and employees include (1) annual performance awards that often include provisions for forfeiture by the employee if certain market performance of the Company's common stock is not achieved, (2) new hire or promotional awards that generally contain only service conditions, or (3) other awards related to specific business initiatives or compensation objectives including retention and merger integration. Generally, such awards vest over periods of approximately 3 years.

The following is a summary of the RSU activity during the year ended December 31, 2018.

RSUs
(In millions)
Outstanding at the beginning of year3
Granted1
Vested(1)
Forfeited—
Outstanding at end of year3

The Company granted approximately 1 million RSUs to the Company's executives and certain other employees for each of the years ended December 31, 2018, 2017 and 2016. The weighted-average grant-date fair value per share of the grants for the years ended December 31, 2018, 2017 and 2016 was $91.52, $73.52 and $68.53 per share, respectively. The weighted-average requisite service period for the RSUs granted during 2018 was approximately 2.4 years.

The approximately 1 million RSUs granted during the year ended December 31, 2018, were comprised of (1) approximately 0.8 million RSUs that time vest over a three-year period and (2) approximately 0.4 million RSUs to the Company's executives and certain other employees which may vest on the third anniversary of the grant date based upon (1) the Company's total shareholder returns (defined as share price appreciation plus the value of dividends paid during the performance period) and (2) the Company's total shareholder return compared to that of the companies in the Standard & Poor's 500 Index. Certain RSU agreements contain provisions that result in forfeiture by the employee of any unvested shares in the event that the Company's common stock does not achieve certain performance targets. To the extent that the requisite service is rendered, compensation cost for accounting purposes is not reversed; rather, it is recognized regardless of whether or not the market performance target is achieved.

The following table summarizes the assumptions used in the Monte Carlo simulation to determine the grant-date fair value for the awards granted during the years ended December 31, 2018, 2017 and 2016, respectively, with market conditions.

Years Ended December 31,
201820172016
Risk-free rate2.4%1.5%0.9%
Expected volatility18%18%19%
Expected dividend rate3.8%4.4%4.2%

The Company recognized aggregate stock-based compensation expense related to RSUs of $90 million, $89 million and $76 million for the years ended December 31, 2018, 2017 and 2016, respectively. The aggregate unrecognized compensation (net of estimated forfeitures) related to RSUs at December 31, 2018 is $82 million and is estimated to be recognized over a weighted-average period of less than one year.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

The following table is a summary of the awards vested during the years ended December 31, 2018, 2017 and 2016.

Years Ended December 31,Total Shares VestedFair Value on Vesting Date
(In millions of shares)
20181.0$107
20170.767
20160.871

Stock-based Compensation

The following table discloses the components of stock-based compensation expense.

Years Ended December 31,
201820172016
Stock-based compensation expense:
Site rental costs of operations$17$15$14
Services and other costs of operations858
Selling, general and administrative expenses837675
Total stock-based compensation$108$96$97
13.Commitments and Contingencies

The Company is involved in various claims, lawsuits, or proceedings arising in the ordinary course of business. While there are uncertainties inherent in the ultimate outcome of such matters and it is impossible to presently determine the ultimate costs or losses that may be incurred, if any, management believes the resolution of such uncertainties and the incurrence of such costs should not have a material adverse effect on the Company's consolidated financial position or results of operations. Additionally, the Company and certain of its subsidiaries are contingently liable for commitments or performance guarantees arising in the ordinary course of business, including certain letters of credit or surety bonds. See note 14 for a discussion of the operating lease commitments. In addition, see note 1 for a discussion of the Company's option to purchase approximately 53% of its towers at the end of their respective lease terms. The Company has no obligation to exercise such purchase options.

14.Operating Leases

Tenant Leases

See note 4 for further information regarding the contractual amounts (including tenant leases) owed to the Company pursuant to agreements in effect as of December 31, 2018.

Operating Leases

The following table is a summary of rental cash payments owed by the Company, as lessee, to landlords pursuant to contractual agreements in effect as of December 31, 2018. The Company is obligated under non-cancelable operating leases for land interests under 74% of its towers. The majority of these lease agreements have (1) certain termination rights that provide for cancellation after a notice period, (2) multiple renewal options at the Company's option, and (3) annual escalations. Lease agreements may also contain provisions for a contingent payment based on revenues or the gross margin derived from the communications infrastructure located on the leased land interest. Approximately 90% of our Towers site rental gross margin and more than 75% of our Towers site rental gross margin is derived from towers that reside on land that we own or control for greater than 10 and 20 years, respectively. The operating lease payments included in the table below include payments for certain renewal periods at the Company's option that are reasonably assured to be exercised and an estimate of contingent payments based on revenues and gross margins derived from existing tenant leases.

Years Ending December 31,
20192020202120222023ThereafterTotal
Operating leases$640$631$628$623$619$8,054$11,195

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

Rental expense from operating leases was $751 million, $710 million, and $678 million, respectively, for the years ended December 31, 2018, 2017, and 2016. The rental expense was inclusive of contingent payments based on revenues or gross margin derived from the communications infrastructure located on the leased land interests of $108 million, $100 million, and $97 million, respectively, for the years ended December 31, 2018, 2017, and 2016.

Effective January 1, 2019, the Company adopted new lease accounting guidance on the recognition, measurement, presentation and disclosure of leases. See note 2 for further discussion.

15.Operating Segments and Concentrations of Credit Risk

Operating Segments

The Company's operating segments consists of (1) Towers and (2) Fiber. The Towers segment provides access, including space or capacity, to the Company's approximately 40,000 towers geographically dispersed throughout the U.S. The Towers segment also reflects certain services relating to the Company's towers, consisting of site development services and installation services. The Fiber segment provides access, including space or capacity, to the Company's approximately 65,000 route miles of fiber primarily supporting small cells and fiber solutions geographically dispersed through out the U.S.

The measurement of profit or loss used by the Company's chief operating decision maker ("CODM") to evaluate the performance of its operating segments are (1) segment site rental gross margin, (2) segment services and other gross margin and (3) segment operating profit. The Company defines segment site rental gross margin as segment site rental revenues less segment site rental cost of operations, which excludes stock-based compensation expense and prepaid lease purchase price adjustments recorded in consolidated cost of operations. The Company defines segment services and other gross margin as segment services and other revenues less segment services and other cost of operations, which excludes stock-based compensation expense recorded in consolidated cost of operations. The Company defines segment operating profit as segment site rental gross margin plus segment services and other gross margin, less selling, general and administrative expenses attributable to the respective segment. All of these measurements of profit or loss are exclusive of depreciation, amortization and accretion, which are shown separately.

Costs that are directly attributable to Towers and Fiber are assigned to those respective segments. The "Other" column (1) represents amounts excluded from specific segments, such as asset write-down charges, acquisition and integration costs, depreciation, amortization and accretion, amortization of prepaid lease purchase price adjustments, interest expense and amortization of deferred financing costs, gains (losses) on retirement of long-term obligations, net gain (loss) on interest rate swaps, gains (losses) on foreign currency swaps, interest income, other income (expense), income (loss) from discontinued operations, and stock-based compensation expense and (2) reconciles segment operating profit to income (loss) before income taxes, as the amounts are not utilized in assessing each segment's performance. The "Other" total assets balance includes corporate assets such as cash and cash equivalents which have not been allocated to specific segments. There are no significant revenues resulting from transactions between the Company's operating segments.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

Year Ended December 31, 2018
TowersFiberOtherConsolidated Total
Segment site rental revenues$3,116$1,600$4,716
Segment services and other revenues69116707
Segment revenues3,8071,6165,423
Segment site rental cost of operations8485251,373
Segment services and other cost of operations41811429
Segment cost of operations(a)(b)1,2665361,802
Segment site rental gross margin2,2681,0753,343
Segment services and other gross margin2735278
Segment selling, general and administrative expenses(b)110179289
Segment operating profit (loss)2,4319013,332
Other selling, general and administrative expenses(b)$191191
Stock-based compensation expense108108
Depreciation, amortization and accretion1,5281,528
Interest expense and amortization of deferred financing costs642642
Other (income) expenses to reconcile to income (loss) before income taxes(c)173173
Income (loss) before income taxes$690
Capital expenditures$442$1,264$35$1,741
Total assets (at year end)$17,667$14,512$606$32,785
Total goodwill (at year end)$5,127$4,951$—$10,078
(a)Exclusive of depreciation, amortization and accretion shown separately
(b)Segment cost of operations for the year ended December 31, 2018 excludes (1) stock-based compensation expense of $25 million and (2) prepaid lease purchase price adjustments of $20 million For the year ended December 31, 2018, Segment selling, general and administrative expenses exclude stock-based compensation expense of $83 million.
(c)See consolidated statement of operations for further information.
Year Ended December 31, 2017
TowersFiberOtherConsolidated Total
Segment site rental revenues$2,900$769$3,669
Segment services and other revenues63750687
Segment revenues3,5378194,356
Segment site rental cost of operations8452641,109
Segment services and other cost of operations37441415
Segment cost of operations(a)(b)1,2193051,524
Segment site rental gross margin2,0555052,560
Segment services and other gross margin2639272
Segment selling, general and administrative expenses(b)9489183
Segment operating profit (loss)2,2244252,649
Other selling, general and administrative expenses(b)$167167
Stock-based compensation expense9696
Depreciation, amortization and accretion1,2421,242
Interest expense and amortization of deferred financing costs591591
Other (income) expenses to reconcile to income (loss) before income taxes(c)8282
Income (loss) before income taxes$471
Capital expenditures$418$782$28$1,228
Total assets (at year end)$17,941$13,669$619$32,229
Total goodwill (at year end)$5,127$4,894$—$10,021
(a)Exclusive of depreciation, amortization and accretion shown separately

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

(b)Segment cost of operations for the year ended December 31, 2017 excludes (1) stock-based compensation expense of $20 million and (2) prepaid lease purchase price adjustments of $20 million. For the year ended December 31, 2017. Segment selling, general and administrative expenses exclude stock-based compensation expense of $76 million.
(c)See consolidated statement of operations for further information.
Year Ended December 31, 2016
TowersFiberOtherConsolidated Total
Segment site rental revenues$2,831$402$3,233
Segment services and other revenues60484688
Segment revenues3,4354863,921
Segment site rental cost of operations840147987
Segment services and other cost of operations34565410
Segment cost of operations(a)(b)1,1852121,397
Segment site rental gross margin1,9912552,246
Segment services and other gross margin25919278
Segment selling, general and administrative expenses(b)9360153
Segment operating profit (loss)2,1572142,371
Other selling, general and administrative expenses(b)$143143
Stock-based compensation expense9797
Depreciation, amortization and accretion1,1091,109
Interest expense and amortization of deferred financing costs515515
Other (income) expenses to reconcile to income (loss) before income taxes(c)133133
Income (loss) before income taxes$374
Capital expenditures$430$409$35$874
Total assets (at year end)$18,395$3,441$839$22,675
Total goodwill (at year end)$5,115$643$—$5,758
(a)Exclusive of depreciation, amortization and accretion shown separately
(b)Segment cost of operations for the year ended December 31, 2016 excludes (1) stock-based compensation expense of $22 million and (2) prepaid lease purchase price adjustments of $22 million. For the year ended December 31, 2016, Segment selling, general and administrative expenses exclude stock-based compensation expense of $75 million for the year ended .
(c)See consolidated statement of operations for further information.

Major Tenants

The following table summarizes the percentage of the consolidated revenues for those tenants accounting for more than 10% of the consolidated revenues.

Years Ended December 31,
201820172016
AT&T20%25%27%
T-Mobile20%22%23%
Verizon Wireless20%22%22%
Sprint15%17%16%
Total75%86%88%

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk are primarily cash and cash equivalents, restricted cash and trade receivables. The Company mitigates its risk with respect to cash and cash equivalents by maintaining such deposits at high credit quality financial institutions and monitoring the credit ratings of those institutions. The Company's restricted cash is predominately held and directed by a trustee (see note 2).

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

The Company derives the largest portion of its revenues from tenants in the wireless industry. The Company also has a concentration in its volume of business with AT&T, T-Mobile, Verizon Wireless and Sprint or their agents that accounts for a significant portion of the Company's revenues, receivables and deferred site rental receivables. The Company mitigates its concentrations of credit risk with respect to trade receivables by actively monitoring the creditworthiness of its tenants, the use of tenant leases with contractually determinable payment terms or proactive management of past due balances.

16.Supplemental Cash Flow Information

The following table is a summary of the supplemental cash flow information during the years ended December 31, 2018, 2017 and 2016.

Years Ended December 31,
201820172016
Supplemental disclosure of cash flow information:
Interest paid$619$547$471
Income taxes paid171614
Supplemental disclosure of non-cash investing and financing activities:
Increase in accounts payable for purchases of property and equipment29218
Purchase of property and equipment under capital leases and installment land purchases403252
Increase in preferred stock dividends accrued but not paid (see note 11)—28—

The reconciliation of cash, cash equivalents, and restricted cash reported within various lines on the consolidated balance sheet to amounts reported in the consolidated statement of cash flows is shown below.

As of December 31,
201820172016
Cash and cash equivalents$277$314$568
Restricted cash, current131121125
Restricted cash reported within long-term prepaid rent and other assets, net555
Cash, cash equivalents and restricted cash$413$440$698

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Tabular dollars in millions, except per share amounts)

17.Quarterly Financial Information (Unaudited)

Summary quarterly financial information for the years ended December 31, 2018 and 2017 is as follows:

Three Months Ended(a)
March 31June 30September 30December 31
2018:
Net revenues$1,299$1,330$1,375$1,419
Operating income (loss)349345359379
Gains (losses) on retirement of long-term obligations(71)(3)(32)—
Benefit (provision) for income taxes(4)(5)(5)(5)
Net income (loss) attributable to CCIC stockholders86152136185
Net income (loss) attributable to CCIC common stockholders, per common share:
Basic$0.21$0.37$0.33$0.45
Diluted$0.21$0.36$0.33$0.44
Three Months Ended(a)
March 31June 30September 30December 31
2017:
Net revenues$1,016$1,038$1,063$1,238
Operating income (loss)257259261267
Gains (losses) on retirement of long-term obligations(4)———
Benefit (provision) for income taxes(4)(5)(2)(15)
Net income (loss) attributable to CCIC stockholders11911211598
Net income (loss) attributable to CCIC common stockholders, per common share:
Basic$0.33$0.31$0.22$0.17
Diluted$0.33$0.31$0.21$0.17
(a)The sum of quarterly information may not agree to year to date information due to rounding.
18.Subsequent Events

February 2019 Senior Notes Offering

On February 11, 2019, the Company issued $1.0 billion aggregate principal amount of senior unsecured notes ("February 2019 Senior Notes"), which consisted of (1) $600 million aggregate principal amount of 4.300% senior unsecured notes due February 2029 and (2) $400 million aggregate principal amount of 5.200% senior unsecured notes due February 2049. The Company used the net proceeds of the February 2019 Senior Notes offering to repay a portion of the outstanding borrowings under the 2016 Revolver.

Common Stock Dividend

On February 21, 2019, the Company's board of directors declared a quarterly cash dividend of $1.125 per common share. The quarterly dividend will be paid on March 29, 2019 to common stockholders of record as of March 15, 2019.

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