Operating Segments

The Company has three reportable operating segments as follows:

Industrial Business Unit

The Industrial business unit develops and manufactures thermal and visible-spectrum imaging camera cores and components that are utilized by third parties to create thermal, industrial, and other types of imaging systems. The segment also develops and manufactures devices that image, measure, and assess thermal energy, gases, and other environmental elements for industrial, commercial, and scientific applications, imaging payloads for Unmanned Aerial Systems ("UAS"), machine vision cameras, people counting and tracking, and thermal imaging solutions for use by consumers in the smartphone and mobile devices markets. Products include thermal imaging cameras, gas detection cameras, firefighting cameras, process automation cameras, and environmental test and measurement devices.

Government and Defense Business Unit

The Government and Defense business unit develops and manufactures enhanced imaging and recognition solutions for a wide variety of military, law enforcement, public safety, and other government customers around the world for the protection of borders, troops, and public welfare. The segment also develops and manufactures sensor instruments and integrated platform solutions for the detection, identification, and suppression of chemical, biological, radiological, nuclear, and explosives ("CBRNE") threats for military force protection, homeland security, and commercial applications. Offerings include airborne, land, maritime, and man-portable multi-spectrum imaging systems, radars, lasers, imaging components, integrated multi-sensor system platforms, CBRNE detectors, nano-class UAS solutions, and services related to these systems.

Note 19. Operating Segments and Related Information - (Continued)

Operating Segments - (Continued)

Commercial Business Unit

The Commercial business unit develops and manufactures cameras, video recording systems, and video management systems for use in commercial and critical infrastructure, electronics and imaging instruments for the recreational and commercial maritime market, intelligent traffic monitoring and signal control systems, and hand-held and weapon-mounted thermal imaging systems for use in a variety of applications. Products include thermal and visible-spectrum security cameras, digital and networked video recorders, and related software and accessories, a full suite of networked marine electronic systems including multi-function helm displays, navigational instruments, autopilots, radars, sonar systems, thermal and visible imaging systems, and communications equipment for boats of all sizes, traffic cameras, sensors and associated traffic management software, and thermal scopes and handheld thermal cameras.

The Company’s chief operating decision maker ("CODM"), its Chief Executive Officer, evaluates each of its segments’ performance and allocates resources based on revenue and segment operating income. Intersegment revenues are recorded at cost and are eliminated in consolidation. The Company and each of its segments employ consistent accounting policies.

The following tables present revenue, operating income, and assets for the three segments. Operating income as reviewed by the CODM is revenue less cost of goods sold and operating expenses, excluding general corporate expenses, amortization of purchased intangible assets, amortization of acquisition-related inventory step-up, loss on sale of a business and restructuring and other charges. Net accounts receivable, inventories and demonstration assets for the operating segments are regularly reviewed by management and are reported below as segment assets. All remaining assets, liabilities, capital expenditures, and depreciation are managed on a Company-wide basis.

Operating segment information is as follows (in thousands):



	Three Months Ended March 31,
	2019			2018
Revenue—External Customers:
Industrial	$	179,370		$	170,658
Government and Defense	173,350			159,331
Commercial	92,016			109,629
	$	444,736		$	439,618
Revenue—Intersegments:
Industrial	$	6,198		$	6,332
Government and Defense	1,512			1,528
Commercial	4,433			4,481
Eliminations	(12,143		)	(12,341		)
	$	—		$	—
Segment operating income:
Industrial	$	56,897		$	45,455
Government and Defense	48,267			46,182
Commercial	12,948			14,472
	$	118,112		$	106,109

Note 19. Operating Segments and Related Information - (Continued)

Operating Segments - (Continued)

A reconciliation of the Company's consolidated segment operating income to consolidated earnings before income taxes is as follows (in thousands):



	Three Months Ended March 31,
	2019			2018
Consolidated segment operating income	$	118,112		$	106,109
Unallocated corporate expenses	(24,562		)	(34,948		)
Amortization of purchased intangible assets	(5,928		)	(5,987		)
Amortization of acquisition-related inventory step-up	(6,477		)	—
Loss on sale of business	—			(10,178		)
Restructuring and other charges	(63		)	496
Consolidated earnings from operations	81,082			55,492
Interest and non-operating expenses, net	(6,325		)	(877		)
Consolidated earnings before income taxes	$	74,757		$	54,615

Unallocated corporate expenses include general corporate expenses, acquisition related costs and executive transition costs.



	March 31,		December 31,
	2019		2018
Operating segment assets:
Net accounts receivable, inventories and demonstration assets:
Industrial	$	263,551	$	266,457
Government and Defense	359,195		307,041
Commercial	152,722		137,560
	$	775,468	$	711,058
Goodwill:
Industrial	390,599		391,603
Government and Defense	284,649		284,188
Commercial	228,213		228,780
	$	903,461	$	904,571
Total operating segment assets	$	1,678,929	$	1,615,629

Assets not allocated:
Cash and cash equivalents	$	284,363	$	512,144
Assets held for sale, net	—		2,032
Prepaid expenses and other current assets	67,615		67,413
Property and equipment, net	253,678		247,407
Deferred income taxes	97,705		100,620
Intangible assets, net	140,551		146,845
Unallocated assets from acquisitions	575,079		14,210
Other assets	108,389		74,942
Total assets	$	3,206,309	$	2,781,242

Note 19. Operating Segments and Related Information - (Continued)

Revenue and Long-Lived Assets by Geographic Area

Information related to revenue by significant geographical location, determined by the end customer, is as follows (in thousands):



	Three Months Ended March 31, 2019
	Industrial		Government and Defense		Commercial		Total
United States	$	101,211	$	109,304	$	32,211	$	242,726
Europe	31,308		26,596		42,556		100,460
Asia	34,434		17,386		6,959		58,779
Middle East/Africa	3,769		17,407		6,096		27,272
Canada/Latin America	8,648		2,657		4,194		15,499
	$	179,370	$	173,350	$	92,016	$	444,736



	Three Months Ended March 31, 2018
	Industrial		Government and Defense		Commercial		Total
United States	$	86,296	$	95,133	$	44,015	$	225,444
Europe	35,543		17,203		44,777		97,523
Asia	34,057		18,351		8,965		61,373
Middle East/Africa	3,664		27,184		5,559		36,407
Canada/Latin America	11,098		1,460		6,313		18,871
	$	170,658	$	159,331	$	109,629	$	439,618

Long-lived assets by significant geographic locations are as follows (in thousands):



	March 31,		December 31,
	2019		2018
United States	$	1,308,819	$	720,885
Europe	445,145		446,704
Other foreign	227,194		220,386
	$	1,981,158	$	1,387,975

Major Customers

Revenue derived from major customers is as follows (in thousands):



	Three Months Ended March 31,
	2019		2018
United States government	$	137,493	$	118,955