Segment Information

The Company operates one principal homebuilding business. In accordance with FASB ASC Topic 280, Segment Reporting ("ASC 280"), the Company has determined that each of its operating divisions is an operating segment. The Company’s President and Chief Executive Officer has been identified as the chief operating decision maker. The Company’s chief operating decision maker directs the allocation of resources to operating segments based on the profitability and cash flows of each respective segment.

The Company’s homebuilding operations design, construct and sell a wide range of homes designed to meet the specific needs in each of its markets. In accordance with ASC 280, prior to the acquisition of RSI Communities (see Note 2), the Company's homebuilding operations had been grouped into six operating segments. During the three months ended March 31, 2018, the Company added one additional operating segment, Texas as a result of the RSI Acquisition. As such, in accordance with the aggregation criteria defined by ASC 280, the Company’s homebuilding operating segments have been grouped into seven reportable segments:

California, consisting of operations in Orange, Los Angeles, Alameda, Contra Costa, San Joaquin, Santa Clara, Riverside and San Bernardino counties.

Arizona, consisting of operations in the Phoenix, Arizona metropolitan area.

Nevada, consisting of operations in the Las Vegas, Nevada metropolitan area.

Colorado, consisting of operations in the Denver, Colorado metropolitan area.

Washington, consisting of operations in the Seattle, Washington metropolitan area.

Oregon, consisting of operations in the Portland, Oregon metropolitan area.

Texas, consisting of operations in the Austin, Texas and San Antonio, Texas metropolitan areas.

Corporate develops and implements strategic initiatives and supports the Company’s operating segments by centralizing key administrative functions such as finance and treasury, information technology, risk management and litigation and human resources.

Segment financial information relating to the Company’s operations was as follows (in thousands):



	Three Months Ended March 31, 2018			Three Months Ended March 31, 2017
Operating revenue:
California	$	134,812		$	81,967
Arizona	32,039			26,716
Nevada	49,176			30,548
Colorado	40,063			21,330
Washington (1)	55,651			43,474
Oregon	46,853			54,819
Texas	14,774			—
Total operating revenue	$	373,368		$	258,854

(1) Operating revenue in the Washington segment includes construction services revenue.

	Three Months Ended March 31, 2018			Three Months Ended March 31, 2017
Income (loss) before (provision for) benefit from income taxes:
California	$	11,419		$	6,327
Arizona	2,487			2,298
Nevada	4,839			2,192
Colorado	3,164			296
Washington	4,511			314
Oregon	3,637			4,481
Texas	434			—
Corporate	(15,089		)	(9,006		)
Income before extinguishment of debt	$	15,402		$	6,902
Corporate - Loss on extinguishment of debt	—			(21,828		)
Income (loss) before (provision for) benefit from income taxes	$	15,402		$	(14,926	)



	March 31, 2018		December 31, 2017
Homebuilding assets:
California	$	934,977	$	631,649
Arizona	176,217		170,634
Nevada	212,268		211,202
Colorado	156,257		149,183
Washington	308,901		286,442
Oregon	329,779		288,981
Texas	314,153		—
Corporate (1)	193,854		323,013
Total homebuilding assets	$	2,626,406	$	2,061,104


(1)	Comprised primarily of cash and cash equivalents, deferred income taxes, receivables, lease right-of-use assets, and other assets.