Thank you, France. Good afternoon, everyone and thank you for joining us for the CenturyLink second quarter 2020 earnings call.

Joining me on the call today are Jeff Storey, President and Chief Executive Officer, and Neel Dev, Executive Vice President and Chief Financial Officer. Before we begin, I need to call your attention to our safe harbor statement on slide 2 of our 2Q 2020 presentation which notes that this conference call may include forward-looking statements subject to certain risks and uncertainties.

All forward-looking statements should be considered in conjunction with the statements on slide 2 and the risk factors in our SEC filings, including the cautionary statements and risk factors related to COVID-19. On the call today, we will be referring to certain non-GAAP financial measures, which are reconciled to the most comparable GAAP measures in our earnings press release.

All of our earnings materials are available on the Investor Relations section of the CenturyLink website. Please note that effective as of the beginning of 2020, we elected to change the presentation of certain taxes related to specific revenue producing transactions, including federal and certain state USF regulatory fees to present all such taxes on the net basis.

Additionally, comparisons to prior periods are on a year-over-year basis, unless noted and certain metrics exclude transformation costs and other special items as detailed in our earnings materials. Finally, I want to remind everyone that the FCCs quiet period rules are in effect for both the FCC Spectrum Auction 105 and the Rural Digital Opportunity Fund auction 904.

Therefore, any comments we make around Spectrum or RDOF will be very limited. With that, I'll turn the call over to Jeff.

Thanks Valerie. And thank you everyone for joining us.

On today's call, I'll provide my thoughts on our second-quarter results, the market demand we see for dynamic robust fiber-based services that are at the heart of CenturyLink, and how we continue to position the Company to grow as we meet that demand. After that, Neel will provide an overview of the quarter and then we will open it up to your questions.

I'll start with the solid results we delivered in the second quarter. Our team has done an incredible job of maintaining direct engagement with our enterprise customers.

We've begun to see our customers adapt to the new normal of COVID-19 and resume their digital transformation efforts. They see that using next generation technologies enabled them to adapt their business models more rapidly and are working to take advantage of tools like artificial intelligence and machine learning across distributed compute resources and high performance networking.

This translates into greater demand for transport services, hybrid WAN connectivity, network based security, edge computing and managed services as enterprises adjust to a more data dependent and distributed operating environment. This new normal has also increased consumers' need for digital services and the demand for data shows no signs of slowing.

The economic effects of the pandemic create uncertainty for our customers, partners, the Company and the market in general. But the pandemic has also highlighted the absolutely essential and durable nature of CenturyLink's services and infrastructure in an all of digital world.

Now more than ever, businesses realize that to thrive, hey must acquire analyze and act on data and deliver the digital applications and experiences that people need. As you can see on slide 4, we own the critical infrastructure.

Everything from the extensive fiber network to the deep caring and interconnection relationships required to deliver customers agile, scalable, secured network infrastructure that is easily inflectioned. I'm proud of how responsive our employees have been to customers and how they have delivered with speed and urgency.

This agility is key to our strategy and is underpinned by our ongoing transformation from a telecom service provider to a leading technology company providing network and network supported technology solutions to today's digital market. We all know how well positioned our infrastructure is, that our value proposition is more than having great infrastructure.

I frequently talk to employees about how our relationships with customers must be rooted in CenturyLink's capabilities to drive their success, rather than the mindset of speeds and feeds and circuits of a typical telecom company. As a technology company, we combine our deep infrastructure strength with a digital operating environment that enables our customers to turn their data and connectivity into a strategic advantage.

We integrate network, compute and operational technologies with managed services to simplify their business operation. Capabilities like orchestration services help them control the thousands of widely distributed devices and digital assets they now have to manage.

The COVID-19 crisis didn't create this need, but it has certainly amplified and accelerated it. And you can see this in our second quarter results with improving revenue trend led by revenue growth in enterprise, solid performance in iGAM on a constant currency basis and growth in consumer broadband.

In the second quarter, in addition to improved revenue performance we saw sequential and strong year-over-year growth in sales for both iGAM and enterprise somewhat offset by the anticipated decline in wholesale and SMB. While SMB sales haven't been as robust as enterprise and iGAM, SMB revenue results were in line with prior quarters demonstrating the resilience and importance of our services to these customers even in the face of the pandemic.

We continue to believe we have tremendous opportunity and have made changes in our leadership and go-to-market approach to improve our performance in this segment. In the coming months, you will see us expand our efforts to grow our small business customer base, delivering a broader digital experience in our more than 170,000 fiber fed on net buildings.

Let me give you some color around our quarterly sales growth and funnel outlook by highlighting a couple of examples. As the pandemic hit the US near the end of the first quarter, the priority for customers like most of us was to manage the crisis in front of them.

Other than requirements for emergency connectivity, conversations about network expansions or future transformations understandably paused in the early days. But as customers have moved beyond the first wave of crisis response, we've seen a marked change in their engagement and increased urgency in their dialog about longer term digital transformation of their work environment and data platforms.

It's a pivot we have noticed across our customer base and it's one of the key drivers in the growth of our sales funnel. These discussions are about more than just network.

As I noted earlier, this is about using our technology platform to provide services in new and effective ways to meet the evolving needs of our customers. For example, we recently announced a contract with the State of Arizona to provide network connectivity and managed IT services that will support all state government agencies and transform how the state delivers services to its citizens.

CenturyLink had previously won an AZNet contract, the type of connectivity contract that telecom companies frequently win. But because of our full range of solutions, we were able to expand our relationship beyond the network to include critical capabilities such as cloud-based integrated security, automation and cloud orchestration.

This is the CenturyLink of the future, a company that delivers digital technology solutions to our customers differentiated through our world-class fiber infrastructure. If you consider the increasing demand across all customer verticals to move massive datasets as quickly as possible to widely distributed processing resources, our infrastructure is very well aligned to meet this shift in requirement.

By combining just 100 or so of our existing technical spaces with our deeply distributed fiber network, we can serve around 95% of US enterprise locations within five milliseconds of latency. Further, as operators of one of the largest and most interconnected networks in the world, we enable our customers to efficiently and effectively collect, process and move their data seamlessly across public clouds, private clouds, public data centers, company-owned data centers and the various work locations of the enterprise whether in employee's homes or in the office.

Now I see examples of this in our business every day. Turning to slide 7 for a few examples.

One of our customers, a food manufacturing facility, relies on CenturyLink to host their robotics control application. We built wireless connectivity across the factory floor, collect manufacturing data and distribute it in real time to the manufacturers, suppliers, across the country.

All of this is delivered over our network with CenturyLink providing network security for the entire stack of applications on our platform. Similarly, we support online gaming customers that require very low latency and great connectivity to end users.

Our edge compute capabilities and our deep global Internet peering have made CenturyLink an excellent platform to meet their needs. As a final example, a large US retailer leverages our Edge platform to move extensive compute resources from each store to our secure edge compute facilities relying on our extremely low latency fiber network for connectivity, reducing their cost and complexity, while also improving performance of their data processing solutions.

One customer has estimated 25% to 30% operational savings as a result. Supporting the deployment of 5G networks is another source of demand that we've seen gain traction.

We continue to partner with our wireless customers to provide the fiber to run their 5G networks. It's long been obvious, the key to effective wireless services is an extensive fiber network and the breadth and depth of our fiber infrastructure supports our ability to meet these needs.

We've seen a few wins but the volume of requests is beginning to increase and we are ramping our own capabilities to support the nationwide deployments of 5G. The alignment of our fiber and other infrastructure assets, the evolving market needs and our team's exceptional execution resulted in a solid quarter for our enterprise business.

Turning to consumer. As I've said before, where we invest, we will grow and you can see that in the second quarter Broadband revenue which grew year-over-year and sequentially.

We remain disciplined continuing with our micro targeting strategy and funding our expansion, while also focusing on better penetration in areas already served. Year-to-date, we've added more than 200,000 new homes passed to our fiber footprint and have approximately 2.2 million homes addressable today.

During the quarter, we added 42,000 1-gig and above customers, a record for us since we began expanding our fiber to the home efforts. I recently read a social media post comparing CenturyLink gigabit services to those of one of our large, very capable cable competitors.

The writer got it all right. Our price per bit was lower, the pricing was simpler and the lack of congestion, better upstream speed and lower latency of our network was better than the cable alternative.

Everything about the experience made CenturyLink a clear winner in this writer's analysis. While this was a blog on our consumer services, the same benefits to extend to our small business customers.

We've been clear that our principal strategic focus is our enterprise business, but we also embrace the consumer opportunity and are very encouraged by the returns we see in consumer and small business fiber deployments. We've all been affected by the COVID-19 crisis both at home and at work.

CenturyLink is no exception and it certainly has changed how we think about work from home and the distributed workforce. What has not changed is our long-term strategy, our long-term focus on the customer or the timelines of our ongoing digital transformation efforts.

I continue to be impressed by our team members, how they're managing through the pandemic to deliver for our customers and we remain in the primarily work from home environment with roughly 75% of our employees working from home and 25% working from work. We are currently planning a broader return to the office and will follow a phased approach and we'll be stack based by location in our decision making.

While a few specific employees may return earlier, I've told employees not to expect to return to the office before early fall. Like many of our customers, the crisis has accelerated our digital transformation and changes to our staffing model.

Frankly I don't expect we will ever return to work from work approach we had prior to the pandemic. Finally, I'll touch on our capital allocation strategy.

We believe we have the right balance in investing for growth, reducing leverage and returning more than $1 billion per year in dividends to shareholders. I believe the actions we have taken in the past have put us in a good position for weathering COVID-19 and the economic downturn and we will continue following the objectives we've laid out for you.

We continue investing in the business, we have reduced our leverage to 3.7 times and have no significant near-term maturities and our ability to support our dividend speaks for itself with the payout ratio in the $30s. However, I don't believe CenturyLink's current market valuation properly reflects where we are as a company.

Although we certainly have legacy businesses, the depth and capabilities of our fiber network, the strong demand for our services across both enterprise and consumer segments, the ongoing efforts to transform and fundamentally change the nature and cost of our service delivery model, the strength of our balance sheet and our relatively low dividend payout ratio makes us excited about our opportunities to transform and grow our business. Our focus is to drive toward that reality.

In summary, we are pleased with the continued improvement in our revenue trajectory and the positive effects of our transformation into a technology company focused on building a platform for critical, digital services. While the ongoing pandemic and economic environment creates near-term uncertainty, we believe our solutions and approach to the market are enabling our success and position us well for long-term growth.

We are excited about the opportunity to help our customers embrace the fourth industrial revolution and digitally transform their businesses. With that, I'll turn it over to Neel to discuss our financial results.

Thank you, Jeff, and good afternoon, everyone. We had a solid quarter, especially with the full quarter impact from a global pandemic and economic uncertainty.

I'll start with our financial summary on slide 8. We have seen steady improvement in total revenue performance over the last five quarters, primarily driven by Enterprise, iGAM and our Consumer Broadband business.

We also had strong year-over-year and quarter-over-quarter revenue growth in our Enterprise segment. We saw continued progress on cost transformation initiatives, achieving $110 million of incremental annualized run rate adjusted EBITDA savings during the quarter.

And delivered solid EBITDA and free cash flow, especially with higher COVID-related expenses, and inefficiencies related to operating in the current environment. We made good progress on our deleveraging and refinancing initiatives and pleased with our resulting interest cost savings.

We also continued to lean into capital spending during the quarter, driven by customer upgrades and supported by strong leading indicators. The connectivity services we provide are critical and our revenue is largely recurring and highly diversified.

Our second quarter results highlight that our business is resilient. Turning to revenue, on a year-over-year basis for the second quarter 2020, total revenue declined 3.4% to $5.2 billion compared to a decline of 5.6% in the second quarter of 2019.

Sequentially, total revenue declined 0.7%. On our first quarter earnings call, we mentioned that about $1 billion or 5% of our annualized total revenues are from highly impacted industries.

We did not see a material change this quarter. Moving to Slide 9 and revenue by business segment.

On a year-over-year basis, international and global accounts or iGAM revenue declined 3.2% and declined 0.7% on a constant currency basis. On a sequential basis, iGAM declined 1.8% and was roughly flat on a constant currency basis.

In addition to currency headwinds, our International business across Europe, Latin America and Asia experienced reduced levels of activity from COVID-related shutdowns. Moving to our Enterprise segment.

On a year-over-year basis, revenue increased 1.7%. This compares to a decline of 1.8% in the second quarter 2019.

On a sequential basis, Enterprise grew about 1%. During the quarter, we upgraded the network infrastructure for several customers and saw strength in collaboration and related services.

We see that customers are buying again, mostly focused on their immediate needs as they operate in the current environment. As Jeff mentioned, both iGAM and Enterprise sales orders grew year-over-year.

Our sales teams continue to have good discussions with customers, indicating an acceleration of their digital strategies. We are cautiously optimistic and encouraged by the leading indicators for both Enterprise and iGAM.

SMB revenue decreased 6.1% year-over-year, primarily driven by continued declines in legacy voice services. This compares to an average decline of 7.1% over the last four quarters.

As we mentioned last quarter, the current situation is likely to have a disproportionate impact on this segment and we are monitoring and working closely with our customers. We also noted that SMB had exposure to highly impacted industries of less than 10% with approximately $1.6 billion of annualized revenue from customers with less than 50 employees.

This dynamic is largely unchanged in the second quarter. Over the long term, we believe SMB represents a growth opportunity for us.

We continue to invest in our product capabilities and customer experience improvement initiatives. It's a large addressable market and expect customer propensity to switch and our traction to increase when businesses return.

Wholesale revenue decreased 6.3% year-over-year. This compares to an average decline of 7.5% over the last four quarters.

Sequentially, we saw a decline of 1%. With respect to wholesale, we continue to expect these customers to optimize spending with other vendors in this environment.

However, as Jeff mentioned, we are seeing some traction with carriers as they invest in 5G. Turning to Consumer on slide 10.

For the second quarter 2020, revenue declined 5.3% year-over-year compared to 8.1% in the year-ago quarter. On a sequential basis, revenue declined 0.8% primarily driven by ongoing legacy, voice revenue declines offset by growth in Broadband.

Broadband revenue now represents 55% of our consumer revenue, up from 47% in the second quarter 2018. Go forward performance will be largely driven by our execution around our fiber to the home investment strategy and driving up penetration of our competitive assets.

Broadband revenue for the second quarter 2020 grew 1.1% year-over-year. On a sequential basis, Broadband grew 0.6%.

In the second quarter, we saw a net loss of 29,000 total broadband subs. In speeds of 100 meg and above, we added 68,000 subs.

Our customers that are participating in the keep Americans connected pledge have been subtracted from the sub numbers that I just mentioned. I'll also note that besides our investments in fiber to the home, we are also investing in self service capabilities as part of our digital transformation efforts.

In addition to a better customer experience, these capabilities are a key component of our cost transformation plan. Turning to adjusted EBITDA on slide 11.

For the second quarter 2020, adjusted EBITDA was $2.174 billion compared to $2.269 billion in the second quarter of 2019 and $2.243 billion in the first quarter of 2020. During the quarter, we increased our bad debt expense by $25 million against accounts receivable due to the possible and expected economic implications of the pandemic.

We also incurred higher expenses, such as overtime as we worked to install expedited services for customers. In addition, we experienced some timing delays for cost transformation initiatives early in the quarter.

Adjusted EBITDA margin for the quarter was 41.9% compared to 42.2% in the year-ago quarter. As you think about sequential EBITDA performance, keep in mind COVID only impacted our first quarter results by two or three weeks versus a full quarter global impact in the second quarter.

As of the end of the second quarter, we achieved approximately $620 million of annualized run rate adjusted EBITDA transformation savings, compared to $510 million as of the end of the first quarter 2020. As we indicated last quarter, we saw some challenges early in the second quarter but as the economy reopened we gained good traction and we were pleased with the run rate savings we achieved as we exited the quarter.

We remain confident in our three-year transformation plans and we continue to expect to achieve the $800 million to $1 billion in annualized run rate adjusted EBITDA savings. Integration and transformation costs on special items incurred in the second quarter 2020 impacted adjusted EBITDA by $89 million and free cash flow by $63 million.

For the second quarter 2020, capital expenditures were approximately $1 billion. This compares to second quarter 2019 CapEx of $800 million.

During the quarter, we augmented capacity for our customers and supported higher traffic on the network. We are leading and continuing to invest in our customers, our capabilities and long life fiber infrastructure assets.

In the second quarter 2020, the Company generated free cash flow of $803 million. This compares to free cash flow of $956 million in the second quarter 2019.

The year-over-year change in free cash flow was primarily driven by higher capital expenditures offset by lower interest expenses. Given our cash flow profile, as I just mentioned, we are investing in the business, supported by positive demand drivers and leading indicators.

Turning to capital markets activity on slide 12. Since announcing our three-year plan to delever to a target range of 2.75 to 3.25 times net debt to adjusted EBITDA, we have reduced net debt by $2.5 billion.

During the second quarter, we paid down $500 million in debt obligations and refinanced $1.2 billion of debt at lower rates. We have refinanced $18 billion over the past 12 months and reduced and extended maturities through 2025 by around $14 billion.

Turning to slide 13. We are lowering our GAAP Interest expense to $1.7 billion from $1.8 billion.

We are also updating our cash interest expense to a range of $1.65 billion to $1.7 billion from our previous range of $1.75 billion to $1.8 billion. The midpoint of guidance represents a savings of about $450 million relative to 2018 cash interest expense.

The reduction is driven by our deleveraging and refinancing activities coupled with a low interest rate. To summarize, our results highlight that our business and the products we sell are resilient.

Our customers are accelerating their digital strategies, our sales funnel is improving and we're cautiously optimistic about the demand drivers. Our balance sheet and liquidity position are strong.

We continue to execute on our capital allocation policy we laid out early last year. Investing in the business to improve revenue trajectory, returning over $1 billion to shareholders through the dividend with a payout ratio expected in the $0.30s and deleveraging to our target leverage range of 2.75 to 3.25.

With that we'll open it up for your questions. France, will you please explain the process?

Thanks for the information. First one, I guess you gave updated interest expense guidance but you didn't reinstate the EBITDA or free cash flow guidance.

Is there any color you can give us around the second half? It sounded from your commentary that things had really reverted in terms of sales picking up and the digital transformation momentum.

So any color you could give us around how we should think about the puts and takes in the second half? And then, Jeff, you talked about the undervaluation of the Company has been a lot of interest on the strategic side, both in the industry broadly and your options.

Any updates you can provide us on potential angles there? Thank you.

Sure, Simon. So in terms of the rest of the year, the way I would characterize it is like Jeff mentioned, and I did in my comments as well, the leading indicators that we see in the business are very positive.

Our funnel is strong. We had a good sales quarter.

But there is still a lot of uncertainty and so therefore we didn't see how at this point of time it was appropriate to reinstate guidance as such, but the overall indicators are still positive.In terms of free cash flow, we still feel good about our payout being in the $0.30s. If you think about the dividend as a percentage of free cash flow and so that gives you some sense that we feel that our free cash flow is going to be fairly resilient even in this environment.

And Simon, with respect to your second question. We don't talk about strategic alternatives or that type of thing.

We are focused on performing as a company and you see that in our second-quarter results. We're focused on investing in growth and you see what we've done with respect to revenue in sales in the second quarter for iGAM and Enterprise and Consumer Broadband and so we're going to continue to focus on that.

You've seen what we've done over the last couple of years, improving our EBITDA performance and making sure that we're investing in and providing a great customer experience. And so when I think about the market valuation being wrong, I look at the business that we are, and I think that we're a very strong company offering exactly what our customers need with - that they're going to need in the future.

It's not just what they need today but it's also what they need tomorrow. And so we'll continue to focus on executing against that business plan.

And then we're always open and I've said this a number of times but actively consider, are there other ways for us to release the value within CenturyLink, and so we'll continue to focus on that. But primarily focused on us growing our business with our customers investing and returning the dividend to our shareholders.

Can you provide a little bit more color on the sequential strength that you saw on the enterprise trends? I believe voice and collaboration revenues were up sequentially.

Anything to call out there? And how much of the sequential performance do you think was related to the current environment, because of the outbreak versus new sales?

And I had a second question on the expenses. You mentioned that there were some higher expenses in the quarter, any quantification of that?

I think you said bad debt was $25 million, but what are some other buckets that increased expenses in the quarter that could come off in the second half? Thank you.

So Batya, in terms of the sequential trend, I think the key point is like Jeff mentioned, it is really changing how companies operate. So if you think about the strength we saw in Voice and Collaboration you mentioned, that exactly is the point.

That you need a lot more connectivity for a higher level of collaboration. So we did see requests for a lot of upgrades that helped the quarter, we did see strength in Collaboration.

Over time, customers may meet those needs in different ways, but the key point from our perspective is that we have a broad range of products. And even if going forward the customers choose to meet that same Collaboration need and a different way.

We have the product set to support that need. In terms of higher expenses, $25 million for bad debt.

We also had over - a fair amount of overtime during the quarter for installing expedited services and as you can imagine in this environment with all the physical constraints, we're not exactly operating in the most efficient way. So I would say there is probably in the low $10s of millions of additional cost embedded in the organization operating in this environment.

Got it. Just a quick follow up on the enterprise commentary.

Looking out to second half, you did mention positive leading indicators and the funnel is strong. But should we expect some of that pick up in Voice and Collaboration actually stays flat or comes down offset with other?

So can Enterprise stay stable in the second half?

Well, it's hard to say. I think in terms of the whether the Voice and Collaboration will continue.

Like Jeff mentioned, even as we look at our plans, we're not contemplating coming back to the office 100%. So it's going to be a different environment in terms of how businesses well operate.

So there is a lot of unknowns in terms of how quickly that things reopen, the impact on the economy for the rest of the year. But in general, we feel pretty good that the Collaboration trends will continue whether they show - continue to show up in legacy products or some of that will transition to newer more strategic services in customers - as customers accelerate their own digital transformation.

Those are all things that we'll work through.

And, Batya, to add to that. It's awfully difficult for us to predict timing of a particular customer transaction or this or that.

But I'll tell you that what we see in the market is that post-COVID, the types of products and services that our customers are going to need are exactly aligned with the digital transformation efforts that we see them taking today. And so we will continue to focus on working with those customers.

We think the sales funnel is growing. We've had improved sales over the second quarter of last year and some of it sequentially and we're really very excited about our opportunities to meet our customers' needs.

It's a little hard to predict is that going to fall in the first quarter - when is that going to fall is a little bit hard to predict. But everything that we've seen and the reaction to COVID, the response sensitivity started to get past that first crisis, the response from our customers has been very positive for the types of products, services and capabilities we deliver.

Just a follow-up on the question on M&A, I can appreciate you're keeping that kind of close to the vest, but just a quick clarification. Are there any sort of debt covenants ]with your higher rated debt or other structure or regulatory issues that would prevent you from divesting any of your consumer business?

And then I have a follow-up.

On the debt side, there is nothing that we couldn't be work through. There is always issues that you have to work through, but depending on what the transaction looked like we could work through that.

Keep in mind, like I mentioned we refinanced about $18 billion over the last 12 months. So some of the documentation is changing as well.

All right, great. And then the follow-up.

You mentioned some cost savings you were working on that you didn't fully realize because you had to take a step back and handle customer - frenetic pace of customer requests. What sort of pace of cost savings do you think you can get back on in Q3 and through the end of the year?

So, Frank, we're very pleased with where we exited the quarter. So if you look at the savings that we realized in second quarter, exiting the quarter was actually higher than what we achieved in first quarter.

So we had a slow start to the quarter for obvious reasons, but we were able to ramp up in the second half of the quarter and exited at $110 million incremental savings. So about halfway through the three-year program, we're at $610 million.

So we feel pretty good about the progress.

A couple. I appreciate you calling out the fiber network within the business.

Maybe it makes sense to give us some kind of idea of fiber revenue mix, fiber revenue growth, fiber capital intensity. Would that be possible at the time, or is it just too buried within the Company overall?

We'll give that some thought, Phil. I think the reality is we have a large fiber business.

We also have a large wavelength business. We have a large IP business.

And so it gets into what level of breakdown do we start providing but that's a good point in terms of us thinking through our disclosures and we'll give that some more thought.

And fiber is the core of everything we provide, so essentially all of our revenue or the vast majority of our revenue rides on fiber. So we'll give it some thought because it's a little hard to break down.

Yeah. And I think that's the where the problem lies is it's hard for us on the outside to say okay there's a great fiber asset here when many of the revenue streams in the Company are still declining but it would help to clarify if we could see some kind of break down.

Maybe another one if I can. The small business versus medium business, you've talked about this in the past, is small still acting like consumer or maybe worse these days from - than consumer and medium acting more like enterprise and getting to quickly better here?

Yes. So specific to the quarter, I think we didn't really see a performance difference as such.

So we have about last quarter, I mentioned about $1.6 billion of revenues that are from customers less than 50 employees. So that sequentially declined mid single-digit millions, so fairly stable in this environment.

But to your broader question, I think we are taking a closer look in terms of how we serve the really small end of small business and that you're right is more aligned to consumer and then more of the mid-market is more aligned to our enterprise strategy.

And I mentioned in my comments that I think we have a great opportunity with our small business customers. We know the opportunity with enterprise customers, we know the opportunity with our medium-sized customers.

And I think there's a good opportunity with our small business customers. We have more than 170,000 fiber fed on-net buildings, we're going to those customer segments with a more - with a broader digital experience and deeper digital experience for them.

And so I think there is a good opportunity as we bring those things together and deliver for the customers. But so far Neel's comments about what we've seen are pretty accurate.

I remember when the when the Time Warner deal happened, there was a bit of - took the Company's eye off the ball on some of the smaller business customers that TW telecom had had. What does the sales process look like for that type of customer today?

We'll move try and get into more of this in the coming months and then spend more time on it, but where we wanted to be is a digital experience. When the customer especially if they're in a fiber fed building, when the customer gets in the building that we give them the capabilities to turn up services rapidly, instantly if possible.

We give them the ability to learn about our services and explore our services in a digital way and we really simplify the overall process and we recognize that they're mass market customers more than customized customers. And we will deliver the mass-market solutions to them, so that we can add them quickly, efficiently and at scale through a digital service delivery model.

But keeping that underlined, Phil…

Thanks guys.

Jeff just mentioned, Phil, in terms of the difference now is if you think about level three acquisition of Time Warner, really the smaller end of the base. We didn't really have the scale to serve that customer base profitably, but today with our consumer processes that we have, we have the scale to really address that business in a very profitable way, especially when you layer on a digital strategy.

Thanks. Jeff, maybe just a quick follow up on your thoughts about call it the new normal or whatever we want to call it, but what does that mean for corporate's longer term if we see the corporate office footprint starting to shrink down and potentially having datacenters catch more of those servers instead of having them located at the corporate headquarters?

Does that have a long-term impact on the Enterprise business? And then I guess secondly, you mentioned the technology transformation which I guess shouldn't surprise any of us.

But with respect to SD-WAN adoption, a couple of your peers are saying you're seeing a pretty strong acceleration there, are you seeing the same thing? And what if anything should we expect the impact on margins to be?

Thanks.

Sure. With respect to where do I think corporations are going.

Well, they become more distributed work from home fewer offices locations. I do think they will become more distributed.

I do think that they will recognize that they need to locate their compute resources in different places. Some in the public cloud, some in private data centers, some in our Edge Compute facilities, but they'll do that based on the application and the performance that they are looking out - at out of that application and the network to provide it.

So I do think it will become more widely distributed. What does that mean for our Enterprise business?

I think it means good things because our Enterprise business is focused on making sure that we deliver network and network supported technologies to our customers to support that hybrid networking topology and making sure that we're matching our capabilities to the type of application they have. The thing that's most important is connectivity and bandwidth and latency.

And so we will - it will give us opportunities to make sure that that we have more places to go to, more ways to use our deeply interconnected network. You can look at every major data center, you can look at public clouds and private clouds, and eyeball networks.

We operate a very deeply interconnected network and that's a competitive advantage. With respect to SD-WAN, is it growing or not growing or VPNs.

We think that there is a great opportunity for hybrid WAN. If it's not an SD-WAN solution, is not a VPN solution, it's a hybrid WAN solution and we're continuing to work with our customers to roll out those capabilities and a more distributed workforce, a more distributed operating environment feeds into that hybrid WAN capability as well.

Thanks so much for taking the questions. So if I look at the quarter, I would say this is just my numbers, but I would say about 85% of it of the B on revenue was Voice, another 15% was Consumer Broadband and I think both of those in retrospect we could have anticipated, but the rest of the business was in line.

And I know that talking to your peers installations and turning bookings into billings was a question mark over the whole quarter. If you could address how you see that book to bill relationship in second quarter and how you see it evolving into the third quarter?

And then I guess, Jeff, just you mentioned this idea of work from work is definitely changing forever. And I agree with that.

You've got $800 billion to $1 billion cost cutting target, have you had a opportunity to sit down and think about how that evolves in terms of magnitude for the business going forward? Thank you.

Sure I'll start. Neel feel free to add in.

Book to bill. I don't listen to our competitors earnings calls.

I don't know what they said about service delivery. I'm very confident in our service delivery.

Our team has done a great job through this. I think on the second quarter call I made comment either in the prepared remarks or in the questions about customers putting things on hold.

That they're going into the COVID pandemic, and they were concerned and basically said don't mess with the network don't touch it. Let's focus on operating while we figure this out, so things went on hold.

And we call that long-term customer hold. That has continued to reduce.

What we've seen is post that crisis response is our customers not getting back to normal, but moving back that direction. And so we don't see the long-term customer hold.

I think our service delivery team is second to none and they haven't created - we don't have any particular bottlenecks. They're doing a really good job of turning up capabilities and so that book to bill process for us is pretty typical.

Now we do still have some long-term customer hold because not everybody has stopped, but I wouldn't have called it out this quarter as an issue like I might have last quarter. On the second issue and from work from work and have we estimated for our own transformation - are there - what's that mean from a cost savings perspective.

We aren't quite looking at it that way. We look at our transition back to work and we step back from what is the transition look like and we say what is work of the future look like, how do we want to do business in CenturyLink and where do we think it's best and optimized to do so.

And so right now we're in the middle of that effort to make sure that we look at what the future of work within CenturyLink looks like, what mix of it should be done in the office, what mix of it should be done remotely, how do we think about that, how do we think about the jobs, did the jobs change as the products and services are evolving. And so our transformation efforts are really longer term looking at how do we think about the business going forward and we haven't looked right now and said well should we change any of our expectations on the existing targets that we put out there.

We basically said, what are we trying to build as a company. What's the best way to do that.

And then how do we transition to that as we move back from a work from home environment. Now my color in the prepared remarks was basically just to say, I don't expect to go back to the way it was, and I don't expect our customers to go back to the way it was, and I frankly think that's good for CenturyLink overall as we look to support our business and we look to support our customers.

Two if I could. First of all, can you talk about the returns you're getting on Consumer and SMB fiber deployment?

Any metrics you can give us on that? And how those compare to the effect of either turns your stock price at current levels?

And secondly, if you think about continue to lower your interest cost, how do you allocate that sort of the cash flow that freed up between delevering versus the investment? Thanks.

So, James., on your second question. I think it is really aligned to the capital allocation plan that we announced last year.

So we're targeting to get to 2.75 to 3.25 within three quarters. So last quarter, I said given the uncertainty and some of the speed bumps we're hitting along the way, it will take us a quarter or two longer, but we're allocating that cash to delevering.

We've already done $2.5 billion since we announced that plan and $0.5 billion first half of this year. So we're on track there.

And like you've seen, we're investing in the business and then the rest of it has gone to the dividend and our dividend is right now at about $1.1 billion of cash. In terms of your returns not - they vary.

But in general, I would say there is couple things. One, the returns we see are good because we have a micro targeting approach, as you've heard, Jeff talk about in numerous occasions.

We don't really go out and build an entire city, we really go pick the neighborhoods, where we can get high returns because it's a function of population density or home density and the cost to build, so typically aerial plan. So things that we're building right now are very high return.

And I'd also add to that. If you think about small business and obviously as we build fiber networks for consumer customers, we pass a lot of small businesses, but the best opportunity are for the small business customers in the buildings we already have on that.

And those are higher returns, because we're not building fiber for them. The fiber is already there.

We've got there for our enterprise customers, our wholesale customers or for some of their need. And so those are higher returns as we look at them and those investments are really about driving penetration as opposed to building infrastructure.

You spoke a number of times throughout the call about how customers are increasingly focused on digital transformation and how that could benefit the Company over time. If that trend is sustained, should we expect a change in the pace at which certain legacy services roll off?

And if so, how do you feel about your ability to take legacy costs out?

As I look at digital transformation, that certainly is a broad term. But it also includes things like artificial intelligence and machine learning and Big Data and taking advantage of the data within the network, and all of that is incremental.

That's not in lieu of something that they're doing today. So, big part of the digital transformation is new opportunities for us as our customers are adapting to virtual reality and augmented reality and really the fourth industrial revolution and so that's a good opportunity for us.

There are certainly products that are declining and we see that and we'll continue to see that, but I don't think that - and there are way - aspects of our - helping our customers evolve in digital transformation that could affect those products, but my goal is not only to help CenturyLink - existing CenturyLink customers go out and transform digitally, but it's my goal to go out and get other companies customers to digitally transform. And that brings new business to us, it brings the profitable high-margin business that we're focused on to the Company.

And so, yes, there is some aspect of it that can harm our legacy. Yes, but there's far more opportunity for us than downside.

Yes, I think just to add to Jeff's - and yes, we can take cost out faster on the legacy platforms. It helps with our network simplification, it helps in terms of how we right-size our real estate portfolio.

So yeah, we can do that to offset any impact from higher erosion on legacy products. But the key point like Jeff mentioned is we've never seen it be like-for-like.

And Neel, just to go back to some of the higher costs you talked about, the low $10s of millions in overtime and other costs that you mentioned, I guess, first, is that net of COVID related savings like lower T&E expense? And second, should we think of those costs as kind of sticking around for the duration of the pandemic or do you expect them to subside in the coming quarters?

We run a fairly large global business. So well pluses and minuses, the low $10s of millions is kind of our high level estimate of the net effect of the inefficiencies that we have.

We can specifically point to overtime, which obviously we track but there are other costs. So that's kind of the cost than what we have at this point.

And it'll probably be there for a little bit as we operate in this environment until we are back to a more new normal mode, if you will.

I was just curious if you talk a little bit more about the outlook for capital spending for this year and as you're looking at this the business plan developing for next year? I noticed that it was up in the second quarter and year-to-date and if you can frame where that spending is going and how the allocation may evolve over the next 12 to 18 months?

Michael, for us it's really going to be success based. So we - our capital spending during the quarter, like I mentioned, we had a fair amount of upgrades that we did for our customers.

We had higher capacity on the network and we're continuing to invest in building out infrastructure. Like Jeff mentioned in the first half of this year, we've built 200,000 fiber homes enabled in consumer.

So for us we'll continue to monitor it in terms of the funnel and the leading indicators that we see, if we see positive traction we'll continue to invest, if we don't, we'll pull back. That's going to be our approach.

And France, I believe that was the last question. So before I wrap up today's call, I want to leave you with a couple of key thoughts, a few key thoughts.

As customers increasingly rely on CenturyLink's fast and secure platform, we saw strong improvement in revenue performance and growth in the sales during the quarter. While we still see uncertainties related to COVID-19, we're optimistic about our ability to drive revenue growth in the core areas of our business and we're focused on reducing costs for the legacy services we provide.

Our liquidity position is strong, enabling us to invest through this cycle to meet long-term demand where we see opportunities to do so. Our approach to capital allocation is serving us well as we continue to invest in the business, make progress on our deleveraging objectives and support the dividend with comfortable payout ratio in the $0.30s.

We continue to drive our transformation initiatives. We see the results in improved customer experience, better alignment with how our customers want to interact with us and lower costs.

And as always, we remain very focused on growing free cash flow per share over the long term. So I want to thank you all for joining today's call and for your interest in CenturyLink and I wish everyone that you continue to have good health and success.

Operator, that concludes the call.