Segment Reporting

Our operating segments include: (a) REIT Advisory, which provides asset management and advisory services to other entities, (b) Remington, which provides hotel management services, (c) Premier, which provides comprehensive and cost-effective design, development, architectural, and project management services, (d) JSAV, which provides event technology and creative communications solutions services, (e) OpenKey, a hospitality focused mobile key platform that provides a universal smartphone app for keyless entry into hotel guest rooms, (f) RED, a provider of watersports activities and other travel and transportation services, (g) Marietta, which holds the leasehold rights to a single hotel and convention center property in Marietta, Georgia, (h) Pure Wellness, which provides hypoallergenic premium rooms in the hospitality industry, and (i) Lismore and REA Holdings, providers of debt placement, real estate advisory and brokerage services. For 2020, OpenKey, RED, Marietta, Pure Wellness and Lismore and REA Holdings do not meet aggregation criteria or the quantitative thresholds to individually qualify as reportable segments. However, we have elected to disclose OpenKey as a reportable segment. Accordingly, we have five reportable segments: REIT Advisory, Remington, Premier, JSAV and OpenKey. We combine the operating results of RED, Marietta, Pure Wellness and Lismore and REA Holdings into an “all other” sixth reportable segment, which we refer to as “Corporate and Other.” See footnote 3 for details of our segments’ material revenue generating activities.

Our chief operating decision maker (“CODM”) uses multiple measures of segment profitability for assessing performance of our business. Our reported measure of segment profitability is net income, although the CODM also focuses on adjusted EBITDA and adjusted net income, which exclude certain gains, losses and charges, to assess performance and allocate resources. Our CODM currently reviews assets at the corporate (consolidated) level and does not currently review segment assets to make key decisions on resource allocations.

Certain information concerning our segments for the three months ended March 31, 2020, and 2019 are presented in the following tables (in thousands). Consolidated subsidiaries are reflected as of their respective acquisition dates or as of the date we were determined to be the primary beneficiary of variable interest entities.



	Three Months Ended March 31, 2020
	REIT Advisory			Remington			Premier			JSAV			OpenKey			Corporate and Other			Ashford Inc. Consolidated
REVENUE
Advisory services	$	11,836		$	—		$	—		$	—		$	—		$	—		$	11,836
Hotel management	—			6,124			—			—			—			—			6,124
Project management fees	—			—			3,938			—			—			—			3,938
Audio visual	—			—			—			29,674			—			—			29,674
Other	57			—			—			—			522			6,112			6,691
Cost reimbursement revenue ⁽¹⁾	9,064			64,332			1,214			—			—			969			75,579
Total revenues	20,957			70,456			5,152			29,674			522			7,081			133,842
EXPENSES
Depreciation and amortization	2,439			3,377			3,157			504			6			486			9,969
Impairment	—			126,548			49,524			2,141			—			—			178,213
Other operating expenses ⁽²⁾	—			4,295			3,064			26,386			988			13,867			48,600
Reimbursed expenses ⁽¹⁾	8,996			64,332			1,214			—			—			969			75,511
Total operating expenses	11,435			198,552			56,959			29,031			994			15,322			312,293
OPERATING INCOME (LOSS)	9,522			(128,096		)	(51,807		)	643			(472		)	(8,241		)	(178,451		)
Equity in earnings (loss) of unconsolidated entities	—			—			—			—			—			236			236
Interest expense	—			—			—			(257		)	—			(919		)	(1,176		)
Amortization of loan costs	—			—			—			(14		)	—			(52		)	(66		)
Interest income	—			—			—			—			—			28			28
Realized gain (loss) on investments	—			(375		)	—			—			—			—			(375		)
Other income (expense)	—			12			—			(455		)	10			(88		)	(521		)
INCOME (LOSS) BEFORE INCOME TAXES	9,522			(128,459		)	(51,807		)	(83		)	(462		)	(9,036		)	(180,325		)
Income tax (expense) benefit	(2,253		)	1,189			168			(134		)	—			3,115			2,085
NET INCOME (LOSS)	$	7,269		$	(127,270	)	$	(51,639	)	$	(217	)	$	(462	)	$	(5,921	)	$	(178,240	)

________


⁽¹⁾	Our segments are reported net of eliminations upon consolidation. Approximately $3.3 million of hotel management revenue, cost reimbursement revenue and reimbursed expenses were eliminated in consolidation primarily for overhead expenses reimbursed to Remington including rent, payroll, office supplies, travel and accounting.


⁽²⁾	Other operating expenses includes salaries and benefits, costs of revenues for project management, cost of revenues for audio visual and general and administrative expenses.



	Three Months Ended March 31, 2019
	REIT Advisory			Premier			JSAV			OpenKey			Corporate and Other			Ashford Inc. Consolidated
REVENUE
Advisory services	$	10,920		$	—		$	—		$	—		$	—		$	10,920
Project management fees	—			6,442			—			—			—			6,442
Audio visual	—			—			30,975			—			—			30,975
Other	1,071			—			—			257			3,682			5,010
Cost reimbursement revenue	8,625			1,348			—			—			—			9,973
Total revenues	20,616			7,790			30,975			257			3,682			63,320
EXPENSES
Depreciation and amortization	764			2,738			455			7			144			4,108
Other operating expenses ⁽¹⁾	—			2,702			28,008			950			15,259			46,919
Reimbursed expenses	8,403			1,348			—			—			—			9,751
Total operating expenses	9,167			6,788			28,463			957			15,403			60,778
OPERATING INCOME (LOSS)	11,449			1,002			2,512			(700		)	(11,721		)	2,542
Equity in earnings (loss) of unconsolidated entities	—			—			—			—			(275		)	(275		)
Interest expense	—			—			(214		)	—			(83		)	(297		)
Amortization of loan costs	—			—			(12		)	(7		)	(50		)	(69		)
Interest income	—			—			—			—			20			20
Other income (expense)	—			—			(107		)	6			48			(53		)
INCOME (LOSS) BEFORE INCOME TAXES	11,449			1,002			2,179			(701		)	(12,061		)	1,868
Income tax (expense) benefit	(2,489		)	(426		)	(887		)	—			2,502			(1,300		)
NET INCOME (LOSS)	$	8,960		$	576		$	1,292		$	(701	)	$	(9,559	)	$	568

________


⁽¹⁾	Other operating expenses includes salaries and benefits, costs of revenues for project management, cost of revenues for audio visual and general and administrative expenses.