NOTE

14.

OPERATING SEGMENTS

We report our business segment results by segment in accordance with the “management approach.” The management approach designates the internal reporting used by our chief operating decision maker (“CODM”), who is our Chief Executive Officer (the “CEO”), for making decisions and assessing performance of our reportable segments.

See Note

for a detailed discussion of our

three

segments. Each segment’s activities include the design, development, acquisition, manufacturing, marketing, distribution, installation and servicing of its product lines. We evaluate the performance of our operating segments based on revenues and segment adjusted EBITDA, which is defined in the paragraph below.

Segment revenues include leasing, licensing, or selling of products within each reportable segment. Segment adjusted EBITDA includes the revenues and operating expenses from each segment adjusted for depreciation, amortization, write-downs and other charges, accretion of placement fees, non-cash stock based compensation expense, as well as other costs such as certain acquisitions and integration related costs including restructuring and severance charges; initial public offering and secondary offerings costs, legal and litigation expenses including settlement payments; new jurisdictions and regulatory licensing costs; non-cash charges on capitalized installation and delivery; contract cancellation fees; and other adjustments primarily composed of professional fees incurred by the Company for projects, corporate and public filing compliance and other costs deemed to be non-recurring in nature. Revenues in each segment are attributable to

third

parties and segment operating expenses are directly associated with the product lines included in each segment such as research and development, product approval costs, product-related litigation expenses, sales commissions and other directly-allocable sales expenses. Cost of gaming operations and cost of equipment sales primarily include the cost of products sold, service, manufacturing overhead, shipping and installation.

Segment adjusted EBITDA excludes other income and expense, income taxes and certain expenses that are managed outside of the operating segments.

The following provides financial information concerning our reportable segments for the years ended

December 31:

	2019			2018			2017
Revenues by segment
EGM	$	289,642		$	271,025		$	199,931
Table Products		10,194			7,651			4,065
Interactive		4,878			6,623			7,959
Total Revenues		304,714			285,299			211,955
Adjusted EBITDA by segment
EGM		144,718			137,371			107,785
Table Products		3,699			942			(528	)
Interactive		(2,355	)		(2,107	)		(416	)
Subtotal		146,062			136,206			106,841

Write-downs and other:
Loss on disposal of long lived assets		1,068			1,963			3,901
Impairment of long lived assets		5,343			6,089			1,214
Fair value adjustments to contingent consideration and other items		501			701			(630	)
Depreciation and amortization		91,474			77,535			71,649
Accretion of placement fees(1)		6,378			4,552			4,680
Non-cash stock compensation		9,001			10,933			—
Acquisitions and integration related costs including restructuring and severance		3,338			3,644			2,936
Initial public offering and secondary costs		530			2,428			—
Legal and litigation expenses including settlement payments		1,844			992			523
New jurisdictions and regulatory licensing costs		—			—			2,062
Non-cash charge on capitalized installation and delivery		2,700			2,081			1,912
Non-cash charges and loss on disposition of assets		—			—			1,202
Other adjustments		148			(2	)		2,890
Interest expense		36,248			37,607			55,511
Interest income		(163	)		(207	)		(108	)
Loss on extinguishment and modification of debt		—			6,625			9,032
Other expense (income)		4,622			10,488			(2,938	)
Loss before income taxes	$	(16,970	)	$	(29,223	)	$	(46,995	)

(

) Non-cash expense related to the accretion of contract rights under development agreements and placement fees.

The Company’s Chief Operating Decision Maker (the “CODM”) does

not

receive a report with a measure of total assets or capital expenditures for each reportable segment as this information is

not

used for the evaluation of segment performance. The CODM assesses the performance of each segment based on adjusted EBITDA and

not

based on assets or capital expenditures due to the fact that

two

of the Company’s reportable segments, Table Products and Interactive, are

not

capital intensive. Any capital expenditure information is provided to the CODM on a consolidated basis. Therefore, the Company has

not

provided asset and capital expenditure information by reportable segment.

The following provides financial information concerning our operations by geographic area for the years ended

December 31 (

in thousands):

	Year ended December 31,
Revenue:	2019		2018		2017
United States	$	258,691	$	255,256	$	181,743
Other		46,023		30,043		30,212
	$	304,714	$	285,299	$	211,955

	Year ended December 31,
Long-lived assets, end of year:	2019		2018		2017
United States	$	89,597	$	80,617	$	79,301
Other		19,132		14,022		8,608
	$	108,729	$	94,639	$	87,909