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Segment Information
 9 Months Ended
Jul. 01, 2017
Segment Information
Segment Information
The operating segments reported below are the segments of the Company for which separate financial information is available and for which results are evaluated regularly by the Chief Executive Officer in deciding how to allocate resources and in assessing performance.
Segment operating results reflect earnings before corporate and unallocated shared expenses, restructuring and impairment charges, interest expense, income taxes and noncontrolling interests. Segment operating income includes equity in the income of investees. Corporate and unallocated shared expenses principally consist of corporate functions, executive management and certain unallocated administrative support functions.
Equity in the income of investees is included in segment operating income as follows: 
 
Quarter Ended
 
Nine Months Ended
 
July 1,
2017
 
July 2,
2016
 
July 1,
2017
 
July 2,
2016
Media Networks
$
127

 
$
154

 
$
334

 
$
447

Parks and Resorts
(3
)
 
—

 
(8
)
 
—

Consumer Products & Interactive Media
—

 
—

 
1

 
—

Equity in the income of investees included in segment operating income
124

 
154

 
327

 
447

Vice Gain
—

 
—

 
—

 
332

Other
—

 
(2
)
 
—

 
(3
)
Total equity in the income of investees
$
124

 
$
152

 
$
327

 
$
776


During the nine months ended July 2, 2016, the Company recognized its share of a net gain (Vice Gain) recorded by A+E Television Networks (A+E), a joint venture owned 50% by the Company, in connection with A+E’s acquisition of an interest in Vice Group Holding, Inc. (Vice). The Company’s $332 million share of the Vice Gain is recorded in “Equity in the income of investees” in the Condensed Consolidated Statement of Income but is not included in segment operating income. See Note 3 for further discussion of the transaction.
Segment revenues and segment operating income are as follows:
 
Quarter Ended
 
Nine Months Ended
 
July 1,
2017
 
July 2,
2016
 
July 1,
2017
 
July 2,
2016
Revenues (1):
 
 
 
 
 
 
 
Media Networks
$
5,866


$
5,906


$
18,045


$
18,031

Parks and Resorts
4,894


4,379


13,748


12,588

Studio Entertainment
2,393


2,847


6,947


7,630

Consumer Products & Interactive Media
1,085


1,145


3,618


4,241

 
$
14,238

 
$
14,277

 
$
42,358

 
$
42,490

Segment operating income (1):
 
 
 
 
 
 
 
Media Networks
$
1,842

 
$
2,372

 
$
5,427

 
$
6,083

Parks and Resorts
1,168

 
994

 
3,028

 
2,599

Studio Entertainment
639

 
766

 
2,137

 
2,322

Consumer Products & Interactive Media
362

 
324

 
1,371

 
1,541

 
$
4,011

 
$
4,456

 
$
11,963

 
$
12,545

(1) 
Studio Entertainment segment revenues and operating income include an allocation of Consumer Products & Interactive Media revenues, which is meant to reflect royalties on sales of merchandise based on certain film properties. The increase to Studio Entertainment revenues and operating income and corresponding decrease to Consumer Products & Interactive Media revenues and operating income totaled $103 million and $131 million for the quarters ended July 1, 2017 and July 2, 2016, respectively, and $391 million and $573 million for the nine months ended July 1, 2017 and July 2, 2016, respectively.
A reconciliation of segment operating income to income before income taxes is as follows:
 
Quarter Ended
 
Nine Months Ended
 
July 1,
2017
 
July 2,
2016
 
July 1,
2017
 
July 2,
2016
Segment operating income
$
4,011

 
$
4,456

 
$
11,963

 
$
12,545

Corporate and unallocated shared expenses
(99
)
 
(159
)
 
(392
)
 
(457
)
Restructuring and impairment charges
—

 
(44
)
 
—

 
(125
)
Other expense(1)
(177
)
 
—

 
(177
)
 
—

Interest expense, net
(117
)
 
(70
)
 
(300
)
 
(161
)
Vice Gain
—

 
—

 
—

 
332

Infinity Charge(2)
—

 
—

 
—

 
(147
)
Income before income taxes
$
3,618

 
$
4,183

 
$
11,094

 
$
11,987


(1) 
During the quarter the Company recorded a charge, net of committed insurance recoveries, in connection with the settlement of litigation. The Company is pursuing additional insurance coverage for this matter.
(2) 
In the prior-year nine-month period, the Company discontinued its Infinity console game business, which is reported in the Consumer Products & Interactive Media segment, and recorded a charge (Infinity Charge) primarily to write down inventory. The charge also included severance and other asset impairments. The charge was reported in “Cost of products” in the Condensed Consolidated Statement of Income.