NEW YORK (AP) — AT&T Corp. said it may write down the value of some of its $43.8 billion in assets, intensifying speculation that the nation’s largest long-distance phone company is a takeover target.

The company said last month it would stop marketing its residential services. In its second-quarter report filed Wednesday with the Securities and Exchange Commission, the company said that decision means it can review its assets for a possible write down.

The company could write down some of its $22.8 billion in property, plant and equipment or $4.7 billion in goodwill, a measure of the intangible value of an asset. A write-down, which analysts estimate could be in the billions of dollars, would reflect that its assets have declined in value since the company invested billions of dollars in upgrading its network during the telecom boom. As prices for long-distance decrease, so does the value of a long-distance network. AT&T’s largest rival, MCI Inc., has written down nearly $80 billion in assets.

By writing down the value of its assets, the company would lower its monthly depreciation costs, which cut into earnings. Depreciation is an accounting method that reduces the value of an asset to reflect wear and tear on a company’s property, plant and equipment over time.

A company buying AT&T would also have to depreciate AT&T’s assets, which would cut into its earnings as well. By taking a writedown, AT&T would make itself more attractive as a takeover target.

The announcement that it would stop marketing its residential service prompted the largest ratings agencies to downgrade AT&T’s debt in the last month. The company said in Wednesday’s filing the downgrades would increase its interest expenses by $10 million this year and $70 million in 2005.

AT&T, based in Bedminster, N.J., announced the pullback from the residential phone market as it reported its profit tumbled to $108 million, or 14 cents a share, in the April-June quarter from $536 million, or 68 cents a share, in the same period a year ago. Revenue dropped to $7.6 billion, down 13 percent from $8.8 billion in the same period last year.

Meanwhile, AT&T is raising local rates in the 47 states where it sells local service, except Georgia, Michigan, Nebraska, Illinois, California, Wisconsin and Montana. The company does not sell local service Colorado, Alaska, Hawaii and the District of Columbia, according to a company spokesman.

In midday trading on the New York Stock Exchange, AT&T shares were down 7 cents at $14.69.