OPERATING SEGMENTS AND GEOGRAPHIC AREAS

3 Months Ended

Mar. 31, 2017

Segment Reporting [Abstract]

OPERATING SEGMENTS AND GEOGRAPHIC AREAS

SEGMENTS AND GEOGRAPHIC AREAS

Effective January 1, 2017, the Company changed its measure of profit/loss for segment reporting purposes from EBITDA to Operating EBITDA to reflect the manner in which the Company's chief operating decision maker now assesses segment performance and allocates resources. The Company defines Operating EBITDA as EBITDA (which Dow defines as earnings (i.e., "Net Income") before interest, income taxes, depreciation and amortization) excluding the impact of certain items. Operating EBITDA by segment includes all operating items relating to the businesses, except depreciation and amortization; items that principally apply to the Company as a whole are assigned to Corporate. A reconciliation of "Income Before Income Taxes" to Operating EBITDA as well as a listing of the certain items impacting results are provided in the following tables. Prior year data has been updated to conform with current year presentation.

Segment Information	Three Months Ended
In millions	Mar 31, 2017			Mar 31, 2016
Sales by segment
Agricultural Sciences	$	1,568		$	1,646
Consumer Solutions	1,599			1,054
Infrastructure Solutions	2,525			1,594
Performance Materials & Chemicals	2,442			2,181
Performance Plastics	5,025			4,165
Corporate	71			63
Total	$	13,230		$	10,703
Operating EBITDA by segment
Agricultural Sciences	$	351		$	403
Consumer Solutions	500			310
Infrastructure Solutions	511			293
Performance Materials & Chemicals	435			335
Performance Plastics	984			991
Corporate	(77		)	(79		)
Total	$	2,704		$	2,253
Equity in earnings (losses) of nonconsolidated affiliates by segment (included in Operating EBITDA)
Agricultural Sciences	$	(1	)	$	7
Consumer Solutions	40			20
Infrastructure Solutions	55			51
Performance Materials & Chemicals	73			(31		)
Performance Plastics	33			(1		)
Corporate	(4		)	(7		)
Total	$	196		$	39

Reconciliation of “Income Before Income Taxes” to Operating EBITDA	Three Months Ended
In millions	Mar 31, 2017			Mar 31, 2016
Income Before Income Taxes	$	1,128		$	165
+ Interest expense and amortization of debt discount	219			201
- Interest income	25			20
+ Depreciation and amortization	778			607
- Certain items	(604		)	(1,300		)
Operating EBITDA	$	2,704		$	2,253

The following tables summarize the pretax impact of certain items by segment (which are excluded from Operating EBITDA) for the three-month periods ended March 31, 2017 and 2016:

Certain Items by Segment for the Three Months Ended March 31, 2017	Agri-cultural Sciences			Consumer Solutions		Infra-structure Solutions		Perf Materials & Chemicals		Perf Plastics		Corp			Total
In millions
Bayer CropScience arbitration matter (1)	$	(469	)	$	—	$	—	$	—	$	—	$	—		$	(469	)
Costs associated with transactions and productivity actions (2)	—			—		—		—		—		(135		)	(135		)
Total	$	(469	)	$	—	$	—	$	—	$	—	$	(135	)	$	(604	)

(1) Included in "Sundry income (expense) - net." See Note 10 for additional information.

(2) Primarily financial, legal and professional advisory fees associated with the planned all-stock merger of equals with E. I. du Pont de Nemours and Company ("DuPont") as well as implementation costs associated with the ownership restructure of Dow Corning and the Company's restructuring programs, which were included in "Cost of sales" ($23 million) and "Selling, general and administrative expenses" ($112 million) in the consolidated statements of income.

Certain Items by Segment for the Three Months Ended March 31, 2016	Agri-cultural Sciences		Consumer Solutions		Infra-structure Solutions		Perf Materials & Chemicals			Perf Plastics		Corp			Total
In millions
Urethane matters legal settlements (1)	$	—	$	—	$	—	$	(1,235	)	$	—	$	—		$	(1,235	)
Costs associated with transactions and productivity actions (2)	—		—		—		—			—		(65		)	(65		)
Total	$	—	$	—	$	—	$	(1,235	)	$	—	$	(65	)	$	(1,300	)

(1) Included in "Sundry income (expense) - net." See Note 10 for additional information.

(2) Primarily financial, legal and professional advisory fees associated with the planned all-stock merger of equals with DuPont, the ownership restructure of Dow Corning and implementation costs associated with the 2015 Restructuring program, which were included in "Cost of sales" ($23 million) and "Selling, general and administrative expenses" ($42 million) in the consolidated statements of income.

The following table summarizes sales by geographic area:

Geographic Area	Three Months Ended
In millions	Mar 31, 2017		Mar 31, 2016
Sales by geographic area
United States	$	4,820	$	3,800
Europe, Middle East, Africa and India	4,241		3,524
Rest of World	4,169		3,379
Total	$	13,230	$	10,703