Live Nation Entertainment Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

SEGMENT DATA

SEGMENT DATA

12 Months Ended

Dec. 31, 2017

For all periods presented, the Company’s reportable segments are Concerts, Sponsorship & Advertising and Ticketing. Prior to 2017, the Company reported an Artist Nation segment, which is now included in its Concerts segment based on the Company’s belief that the strategy behind artist management is to provide a full range of services related to concert promotion and to expand the Concerts line of business. In connection with this, there has been a change in the way the chief operating decision maker, as defined in the FASB guidance, makes decisions around allocations of resources and management responsibilities for this business.

The Concerts segment involves the promotion of live music events globally in the Company’s owned or operated venues and in rented third-party venues, the production of music festivals, the operation and management of music venues, the creation of associated content and the provision of management and other services to artist. The Sponsorship & Advertising segment manages the development of strategic sponsorship programs in addition to the sale of international, national and local sponsorships and placement of advertising such as signage, promotional programs, rich media offerings, including advertising associated with live streaming and music-related content, and ads across the Company’s distribution network of venues, events and websites. The Ticketing segment involves the management of the Company’s global ticketing operations, including providing ticketing software and services to clients, ticket resale services and online access for customers relating to ticket and event information, and is responsible for the Company’s primary ticketing website, www.ticketmaster.com.

Revenue and expenses earned and charged between segments are eliminated in consolidation. The Company’s capital expenditures below include accruals for amounts incurred but not yet paid for, but are not reduced by reimbursements received from outside parties such as landlords or replacements funded by insurance proceeds.

The Company manages its working capital on a consolidated basis. Accordingly, segment assets are not reported to, or used by, the Company’s management to allocate resources to or assess performance of the segments, and therefore, total segment assets have not been presented.

There were no customers that individually accounted for more than 10% of the Company’s consolidated revenue in any year.

The following table presents the results of operations for the Company’s reportable segments for the years ending December 31, 2017, 2016 and 2015:



	Concerts			Sponsorship & Advertising		Ticketing		Other			Corporate			Eliminations			Consolidated
	(in thousands)
2017
Revenue	$	7,892,076		$	445,148	$	2,143,800	$	21,012		$	—		$	(164,588	)	$	10,337,448
Direct operating expenses	6,641,071			78,725		1,170,121		18,746			—			(159,872		)	7,748,791
Selling, general and administrative expenses	1,119,335			87,268		681,948		19,172			—			—			1,907,723
Depreciation and amortization	226,315			27,669		200,777		432			5,057			(4,716		)	455,534
Loss (gain) on disposal of operating assets	(1,056		)	—		49		—			38			—			(969		)
Corporate expenses	—			—		—		—			134,972			—			134,972
Operating income (loss)	$	(93,589	)	$	251,486	$	90,905	$	(17,338	)	$	(140,067	)	$	—		$	91,397
Intersegment revenue	$	148,125		$	—	$	16,463	$	—		$	—		$	(164,588	)	$	—
Capital expenditures	$	109,801		$	6,701	$	105,317	$	149		$	25,926		$	—		$	247,894
2016
Revenue	$	6,283,521		$	377,618	$	1,827,930	$	7,978		$	—		$	(142,113	)	$	8,354,934
Direct operating expenses	5,202,097			60,218		956,956		2,902			—			(139,465		)	6,082,708



	Concerts			Sponsorship & Advertising		Ticketing		Other			Corporate			Eliminations			Consolidated
	(in thousands)
Selling, general and administrative expenses	950,060			71,089		510,490		16,811			—			—			1,548,450
Depreciation and amortization	194,715			18,206		185,925		2,940			4,433			(2,568		)	403,651
Loss (gain) on disposal of operating assets	(61		)	—		68		—			117			—			124
Corporate expenses	—			—		—		—			125,141			(80		)	125,061
Operating income (loss)	$	(63,290	)	$	228,105	$	174,491	$	(14,675	)	$	(129,691	)	$	—		$	194,940
Intersegment revenue	$	133,505		$	—	$	8,528	$	80		$	—		$	(142,113	)	$	—
Capital expenditures	$	87,306		$	2,161	$	91,285	$	1,028		$	7,824		$	—		$	189,604
2015
Revenue	$	5,382,965		$	333,726	$	1,639,564	$	3,176		$	—		$	(113,700	)	$	7,245,731
Direct operating expenses	4,450,517			47,760		808,697		1,068			—			(111,569		)	5,196,473
Selling, general and administrative expenses	863,516			57,681		488,483		2,175			—			—			1,411,855
Depreciation and amortization	201,775			9,932		184,129		46			3,490			(2,131		)	397,241
Loss on disposal of operating assets	645			—		26		—			174			—			845
Corporate expenses	—			—		—		—			107,945			—			107,945
Operating income (loss)	$	(133,488	)	$	218,353	$	158,229	$	(113	)	$	(111,609	)	$	—		$	131,372
Intersegment revenue	$	104,571		$	—	$	9,129	$	—		$	—		$	(113,700	)	$	—
Capital expenditures	$	41,977		$	4,836	$	93,323	$	—		$	5,011		$	—		$	145,147

The following table provides revenue and long-lived assets for the Company’s foreign operations included in the consolidated financial statements:



	United Kingdom Operations		Other Foreign Operations		Total Foreign Operations		Total Domestic Operations		Consolidated Total
	(in thousands)
2017
Revenue	$	785,174	$	2,779,324	$	3,564,498	$	6,772,950	$	10,337,448
Long-lived assets	$	74,551	$	127,173	$	201,724	$	684,212	$	885,936

2016
Revenue	$	683,464	$	1,882,583	$	2,566,047	$	5,788,887	$	8,354,934
Long-lived assets	$	69,380	$	104,780	$	174,160	$	577,376	$	751,536

2015
Revenue	$	672,826	$	1,534,629	$	2,207,455	$	5,038,276	$	7,245,731
Long-lived assets	$	74,517	$	126,194	$	200,711	$	530,571	$	731,282