Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v3.3.0.814
Segment Information
 9 Months Ended
Sep. 30, 2015
Segment Information  
Segment Information

(7) Segment Information

TripCo, through its ownership interests in subsidiaries and other companies, is primarily engaged in the on‑line commerce industries. TripCo identifies its reportable segments as (A) those consolidated companies that represent 10% or more of its consolidated annual revenue, annual Adjusted OIBDA or total assets and (B) those equity method affiliates whose share of earnings represent 10% or more of TripCo’s annual pre‑tax earnings.

TripCo evaluates performance and makes decisions about allocating resources to its operating segments based on financial measures such as revenue, Adjusted OIBDA, gross margin, average sales price per unit, number of units shipped and revenue or sales per customer equivalent. In addition, TripCo reviews nonfinancial measures such as unique website visitors, conversion rates and active customers, as appropriate.

TripCo defines Adjusted OIBDA as revenue less cost of goods sold, operating expenses, and selling, general and administrative expenses (excluding stock‑based compensation). TripCo believes this measure is an important indicator of the operational strength and performance of its businesses, including each business’s ability to service debt and fund capital expenditures. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. This measure of performance excludes depreciation and amortization, stock‑based compensation, separately reported litigation settlements and restructuring and impairment charges that are included in the measurement of operating income pursuant to GAAP. Accordingly, Adjusted OIBDA should be considered in addition to, but not as a substitute for, operating income, net income, cash flow provided by operating activities and other measures of financial performance prepared in accordance with GAAP. TripCo generally accounts for intersegment sales and transfers as if the sales or transfers were to third parties, that is, at current prices.

For the nine months ended September 30, 2015, TripCo has identified the following consolidated company as its reportable segment:

·

TripAdvisor, Inc.—an online travel research company, empowering users to plan and maximize their travel experience.

TripCo’s operating segments are strategic business units that offer different products and services. They are managed separately because each segment requires different technologies, distribution channels and marketing strategies. The accounting policies of the segments are the same as those described in the Company’s summary of significant accounting policies included in the Annual Report on Form 10-K for the year ended December 31, 2014.

Performance Measures

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended September 30,

 

 

 

2015

 

2014

 

 

 

 

 

 

Adjusted

 

 

 

Adjusted

 

 

 

Revenue

 

OIBDA

 

Revenue

 

OIBDA

 

 

 

amounts in millions

 

TripAdvisor

    

$
415

    
130

    
354

    
119

 

Corporate and other

 

 
17

 
(7)

 
21

 
(5)

 

Consolidated TripCo

 

$
432

 
123

 
375

 
114

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine months ended September 30,

 

 

 

2015

 

2014

 

 

 

 

 

 

Adjusted

 

 

 

Adjusted

 

 

 

Revenue

 

OIBDA

 

Revenue

 

OIBDA

 

 

 

amounts in millions

 

TripAdvisor

    

$
1,183

    
377

    
958

    
370

 

Corporate and other

 

 
37

 
(20)

 
46

 
(20)

 

Consolidated TripCo

 

$
1,220

 
357

 
1,004

 
350

 

 

Other Information

 

 

 

 

 

 

 

 

 

 

September 30, 2015

 

 

 

Total

 

Capital

 

 

 

assets

 

expenditures

 

 

 

amounts in millions

 

TripAdvisor

    

$
7,383

    
93

 

Corporate and other

 

 
83

 
3

 

Consolidated TripCo

 

$
7,466

 
96

 

 

The following table provides a reconciliation of segment Adjusted OIBDA to earnings (loss) before income taxes:

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months

 

Nine months

 

 

 

ended September 30,

 

ended September 30,

 

 

 

2015

 

2014

 

2015

 

2014

 

 

 

amounts in millions

 

Consolidated segment Adjusted OIBDA

    

$
123

    
114

    
357

    
350

 

Stock-based compensation

 

 
(21)

 
(20)

 
(60)

 
(54)

 

Depreciation and amortization

 

 
(67)

 
(77)

 
(199)

 
(219)

 

Interest expense

 

 
(7)

 
(4)

 
(20)

 
(9)

 

Other, net

 

 
13

 
(8)

 
16

 
(8)

 

Earnings (loss) before income taxes

 

$
41

 
5

 
94

 
60