17. Business Segments

We operate in two segments: Marketplaces and Media. Our Marketplaces segment consists of several leading art and design marketplaces where large communities of artists can market and sell their original artwork or their original designs printed on a wide variety of products. Our Media segment consists of our leading owned and operated media properties that publish content, including videos, articles and other content formats, on various category-specific properties with distinct editorial voices, as well as other media properties focused on specific categories or interests that we either own and operate or host and operate for our partners.

Our chief operating decision maker (the “CODM”) uses revenue and operating contribution to evaluate the profitability of our operating segments; all other financial information is reviewed by the CODM on a consolidated basis. Segment operating contribution reflects segment revenue less operating expenses that are directly attributable to the operating segment, not including corporate and unallocated expenses and also excluding: (a) depreciation expense; (b) amortization of intangible assets; (c) share-based compensation expense; (d) interest and other income (expense); (e) income taxes; and (f) contingent payments to certain key employees/equity holders of acquired businesses. Our CODM does not evaluate our operating segments using asset information. We do not aggregate our operating segments. The majority of our principal operations and assets are located in the United States.

The financial performance of our operating segments and reconciliation to consolidated operating loss is as follows (in thousands):


	Year ended December 31,
	2019		2018
Segment Revenue:
Marketplaces	$	89,625	$	93,937
Media		65,331		61,105
Total revenue	$	154,956	$	155,042

Segment Operating Expenses:
Marketplaces(1)	$	91,807	$	95,068
Media(1)		40,601		34,686
Add:
Corporate expenses(2)		30,025		27,089
Consolidated operating expenses	$	162,433	$	156,843

Segment Operating Contribution:
Marketplaces(3)	$	(2,182)	$	(1,131)
Media(3)		24,730		26,419
Add (deduct):
Corporate expenses(2)		(30,025)		(27,089)
Acquisition, disposition and realignment costs(4)		—		320
Adjusted EBITDA(5)	$	(7,477)	$	(1,481)

Reconciliation to consolidated pre-tax income (loss):
Adjusted EBITDA(5)	$	(7,477)	$	(1,481)
Add (deduct):
Interest income (expense), net		225		305
Other (expense) income, net		40		(78)
Depreciation and amortization(6)		(10,111)		(10,270)
Stock-based compensation(7)		(9,364)		(9,431)
Acquisition, disposition, realignment and contingent payment costs(8)		(90)		(2,140)
Loss before income taxes	$	(26,777)	$	(23,095)

(1)

Segment operating expenses reflects operating expenses that are directly attributable to the operating segment, not including corporate and unallocated expenses, and also excluding the following: (a) depreciation expense; (b) amortization of intangible assets; (c) share-based compensation expense; (d) interest and other income (expense); (e) income taxes; and (f) contingent payments to certain key employees/equity holders of acquired businesses.

(2)

Corporate expenses include operating expenses that are not directly attributable to the operating segments, including: corporate information technology, marketing, and general and administrative support functions and also excludes the following: (a) depreciation expense; (b) amortization of intangible assets; (c) share-based compensation expense; (d) interest and other income (expense); and (e) income taxes.

(3)

Segment operating contribution reflects segment revenue less segment operating expenses. Operating contribution has certain limitations in that it does not take into account the impact to the consolidated statements of operations of certain expenses and is not directly comparable to similar measures used by other companies.

(4)

Represents such items, when applicable, as (a) legal, accounting and other professional service fees directly attributable to acquisition, disposition or corporate realignment activities, (b) employee severance, and (c) other payments attributable to acquisition, disposition or corporate realignment activities, excluding contingent payments to certain key employees/equity holders of acquired businesses.

(5)

Adjusted EBITDA reflects net income (loss) excluding interest (income) expense, income tax expense (benefit), and certain other non-cash or non-recurring items impacting net income (loss) from time to time, principally comprised of depreciation and amortization, stock-based compensation, contingent payments to certain key employees/equity holders of acquired businesses and other payments attributable to acquisition, disposition or corporate realignment activities.

(6)

Represents depreciation expense of our long-lived tangible assets and amortization expense of our finite-lived intangible assets, including amortization expense related to our investment in media content assets, included in our GAAP results of operations.

(7)

Represents the expense related to stock-based awards granted to employees as included in our GAAP results of operations.

(8)

Represents such items, when applicable, as (a) legal, accounting and other professional service fees directly attributable to acquisition, disposition or corporate realignment activities, (b) employee severance, (c) contingent payments to certain key employees/equity holders of acquired businesses and (d) other payments attributable to acquisition, disposition or corporate realignment activities.

Revenue by geographic region, as determined based on the location of our customers or the anticipated destination of use was as follows (in thousands):


	Year ended December 31,
	2019		2018
Domestic	$	133,240	$	129,519
International		21,716		25,523
Total revenue	$	154,956	$	155,042