XML 31 R22.htm IDEA: XBRL DOCUMENT v3.22.2
Reportable Segments
 6 Months Ended
Jun. 30, 2022
Segment Reporting [Abstract]  
Segment Reporting Disclosure Reportable Segments
We have three reportable segments, U.S. Markets, International, and Consumer Interactive, and the Corporate unit, which provides support services to each of the segments. Our chief operating decision maker (“CODM”) uses the profit measure of Adjusted EBITDA, on both a consolidated and a segment basis, to allocate resources and assess performance of our businesses. We use Adjusted EBITDA as our profit measure because it eliminates the impact of certain items that we do not consider indicative of operating performance, which is useful to compare operating results between periods. Our board of directors and executive management team also use Adjusted EBITDA as a compensation measure for both segment and corporate management under our incentive compensation plans. Adjusted EBITDA is also a measure frequently used by securities analysts, investors and other interested parties in their evaluation of the operating performance of companies similar to ours.
We define Adjusted EBITDA as net income (loss) attributable to each segment plus net interest expense, plus (less) provision (benefit) for income taxes, plus depreciation and amortization, plus stock-based compensation, plus mergers, acquisitions, divestitures and business optimization-related expenses including certain integration-related expenses, plus certain accelerated technology investment expenses to migrate to the cloud, plus (less) certain other expenses (income).
The segment financial information below aligns with how we report information to our CODM to assess operating performance and how we manage the business. The accounting policies of the segments are the same as described in Note 1, “Significant Accounting and Reporting Policies” and Note 12, “Revenue.”
The following is a more detailed description of our reportable segments and the Corporate unit, which provides support services to each segment:
U.S. Markets
The U.S. Markets segment provides consumer reports, actionable insights and analytics to businesses. These businesses use our services to acquire customers, assess consumers’ ability to pay for services, identify cross-selling opportunities, measure and manage debt portfolio risk, collect debt, verify consumer identities and mitigate fraud risk. The core capabilities and delivery methods in our U.S. Markets segment allow us to serve a broad set of customers across industries. We report disaggregated revenue of our U.S. Markets segment for Financial Services and Emerging Verticals.
•Financial Services: The Financial Services vertical, which accounted for 46.8% of our U.S. Markets revenue for the six months ended June 30, 2022, consists of our consumer lending, mortgage, auto and cards and payments lines of business, and our recently acquired Argus business. Our Financial Services clients consist of most banks, credit unions, finance companies, auto lenders, mortgage lenders, FinTechs, and other consumer lenders in the United States. We also distribute our solutions through most major resellers, secondary market players and sales agents. Beyond traditional lenders, we work with a variety of credit arrangers, such as auto dealers and peer-to-peer lenders. We provide solutions across every aspect of the lending lifecycle; customer acquisition and engagement, fraud and ID management, retention and recovery. Our products are focused on mitigating risk and include credit reporting, credit marketing, analytics and consulting, identity verification and authentication and debt recovery solutions. The results of operations of our Argus are included in the Financial Services vertical in our consolidated statements of income since the date of the acquisition.
•Emerging Verticals: Emerging Verticals include Insurance, Services and Collections, Tenant and Employment, Technology, Commerce & Communications, Public Sector, Media, and other emerging verticals we serve, as well as our recently acquired Neustar business. Our solutions in these verticals are also data-driven and address the entire customer lifecycle. We offer onboarding and transaction processing products, scoring and analytic products, marketing solutions, fraud and identity management solutions and customer retention solutions. The results of operations of Neustar are included in Emerging Verticals in our consolidated statements of income since the date of the acquisition.
International
The International segment provides services similar to our U.S. Markets segment to businesses in select regions outside the United States. Depending on the maturity of the credit economy in each country, services may include credit reports, analytics and solutions services, and other value-added risk management services. In addition, we have insurance, business and automotive databases in select geographies. These services are offered to customers in a number of industries including financial services, insurance, automotive, collections, and communications, and are delivered through both direct and indirect channels. The International segment also provides consumer services similar to those offered by our Consumer Interactive segment that help consumers proactively manage their personal finances and take precautions against identity theft.
We report disaggregated revenue of our International segment for the following regions: Canada, Latin America, the United Kingdom, Africa, India and Asia Pacific.
Consumer Interactive
The Consumer Interactive segment provides solutions that help consumers manage their personal finances and take precautions against identity theft. Services in this segment include paid and free credit reports, scores and freezes, credit monitoring, identity protection and resolution, and financial management for consumers. The segment also provides solutions that help businesses respond to data breach events. Our products are provided through user-friendly online and mobile interfaces and are supported by educational content and customer support. Our Consumer Interactive segment serves consumers through both direct and indirect channels, including our recently acquired Sontiq business. The results of operations of Sontiq are included in the Consumer Interactive segment in our consolidated statements of income since the date of the acquisition.
Corporate
Corporate provides support services for each of the segments, holds investments, and conducts enterprise functions. Certain costs incurred in Corporate that are not directly attributable to one or more of the segments remain in Corporate. These costs are typically enterprise-level costs and are primarily administrative in nature.
Selected segment financial information and disaggregated revenue consisted of the following:
 Three Months Ended June 30,Six Months Ended June 30,
(in millions)2022202120222021
Gross Revenue:
U.S. Markets:
Financial Services$301.2 $270.7 $577.6 $533.7 
Emerging Verticals332.2 168.0 655.7 326.7 
Total U.S. Markets$633.4 $438.7 $1,233.3 $860.4 
International:
Canada$33.1 $34.0 $63.8 $64.4 
Latin America29.5 26.0 56.8 50.1 
United Kingdom49.6 53.4 106.0 103.7 
Africa15.6 15.2 30.4 28.9 
India40.2 27.9 85.3 61.9 
Asia Pacific19.0 16.0 35.9 29.7 
Total International$187.0 $172.5 $378.2 $338.7 
Total Consumer Interactive$147.4 $136.6 $297.0 $266.9 
Total revenue, gross$967.8 $747.7 $1,908.5 $1,466.0 
Intersegment revenue eliminations:
U.S. Markets$(17.8)$(17.6)$(35.5)$(35.0)
International(1.5)(1.5)(2.9)(2.9)
Consumer Interactive(0.3)(0.5)(0.5)(1.0)
Total intersegment eliminations$(19.5)$(19.6)$(39.0)$(39.0)
Total revenue as reported$948.3 $728.2 $1,869.5 $1,427.1 
A reconciliation of Segment Adjusted EBITDA to income from continuing operations before income taxes for the periods presented is as follows:
Three Months Ended June 30,Six Months Ended June 30,
(in millions)2022202120222021
U.S. Markets Adjusted EBITDA$234.4 $186.8 $451.1 $363.5 
International Adjusted EBITDA81.0 72.2 163.0 143.6 
Consumer Interactive Adjusted EBITDA68.0 64.8 137.0 123.3 
Total$383.5 $323.8 $751.0 $630.4 
Adjustments to reconcile to income before income taxes:
Corporate expenses(1)
$(33.1)$(28.5)$(66.5)$(57.6)
Net interest expense(50.7)(24.7)(100.2)(49.8)
Depreciation and amortization(130.6)(93.2)(259.4)(182.7)
Stock-based compensation(2)
(20.3)(17.1)(40.8)(32.5)
Mergers and acquisitions, divestitures and business optimization(3)
(14.0)(8.8)(28.6)(10.6)
Accelerated technology investment(4)
(8.1)(9.8)(20.1)(17.1)
Net other(5)
(2.2)33.8 (37.9)33.7 
Net loss (income) attributable to non-controlling interests4.1 5.2 7.7 8.0 
Total adjustments$(254.9)$(143.1)$(545.8)$(308.6)
Income from continuing operations before income taxes$128.5 $180.7 $205.2 $321.8 
(1)Certain costs that are not directly attributable to one or more of the segments remain in Corporate. These costs are typically enterprise-level costs and are primarily administrative in nature.
(2)Consisted of stock-based compensation and cash-settled stock-based compensation.
(3)For the three months ended June 30, 2022, consisted of the following adjustments: $(9.0) million of acquisition expenses; $(7.7) million of Neustar integration costs; $1.8 million reimbursements for transition services related to divested businesses, net of separation expenses; and a $0.9 million adjustment to fair value of put options.
For the six months ended June 30, 2022, consisted of the following adjustments: $(17.9) million of acquisition expenses; $(16.7) million of Neustar integration costs; a $5.3 million reimbursements for transition services related to divested businesses, net of separation expenses; and a $0.8 million adjustment to fair value of put options.
For the three months ended June 30, 2021, consisted of the following adjustments: $(6.7) million of adjustments to contingent consideration expense from previous acquisitions; $(1.1) million of acquisition expenses; and a $(1.1) million gain reduction to notes receivable that were converted into equity upon acquisition and consolidation of an entity.
For the six months ended June 30, 2021, consisted of the following adjustments: $(7.9) million of adjustments to contingent consideration expense from previous acquisitions; $(2.2) million of acquisition expenses; a $(1.1) million gain reduction to notes receivable that were converted into equity upon acquisition and consolidation of an entity; and a $0.5 million gain on the sale of a cost method investment.
(4)Represents expenses associated with our accelerated technology investment to migrate to the cloud.
(5)For the three months ended June 30, 2022, consisted of $(2.2) million of net other, which includes net losses from currency remeasurement of our foreign operations, loan fees and other.
For the six months ended June 30, 2022, consisted of the following adjustments: $(28.4) million for certain legal and regulatory expenses; $(6.5) million of deferred loan fees written off as a result of the prepayments on our debt; and $(3.0) million of net other, which includes net losses from currency remeasurement of our foreign operations, loan fees and other.
For the three months ended June 30, 2021, consisted of the following adjustments: a $32.4 million net reduction in certain legal expenses; a $3.4 million recovery from the Fraud Incident, net of additional administrative expenses; and $(2.0) million of net other consisting of net losses from currency remeasurement of our foreign operations, loan fees and other.
For the six months ended June 30, 2021, consisted of the following adjustments: a $32.4 million net reduction in certain legal expenses; a $3.4 million recovery from the Fraud Incident, net of additional administrative expense; and
$(2.1) million of net other consisting of net losses from currency remeasurement of our foreign operations, loan fees and other.

Earnings from equity method investments included in non-operating income and expense was as follows:
Three Months Ended June 30,Six Months Ended June 30,
(in millions)2022202120222021
U.S. Markets$0.3 $0.7 $0.7 $1.3 
International2.8 2.0 5.4 4.4 
Total$3.1 $2.7 $6.1 $5.7