Segment and Geographic Information

As discussed in Note 1 – Accounting Policies, we have four reportable segments: Ratings, Market Intelligence, Platts and Indices.

Our Chief Executive Officer is our chief operating decision-maker and evaluates performance of our segments and allocates resources based primarily on operating profit. Segment operating profit does not include Corporate Unallocated, other income, net, or interest expense, net, as these are costs that do not affect the operating results of our reportable segments. We use the same accounting policies for our segments as those described in Note 1 – Accounting Policies.

In April of 2018, we acquired Kensho for approximately $550 million, net of cash acquired, in a mix of cash and stock. The results of Kensho, an operating segment of the Company, are included in Corporate revenue and Corporate Unallocated for financial reporting purposes. See Note 2 — Acquisitions and Divestitures for additional information.

Effective beginning with the first quarter of 2018, we began reporting the financial results of Market Intelligence and Platts as separate reportable segments consistent with the changes to our organizational structure and how our Chief Executive Officer evaluates the performance of these segments. Our historical segment reporting has been retroactively revised to reflect the current organizational structure.

A summary of operating results for the years ended December 31 is as follows:



Revenue
(in millions)	2018			2017			2016
Ratings	$	2,883		$	2,988		$	2,535
Market Intelligence	1,833			1,683			1,661
Platts	815			774			925
Indices	837			728			638
Corporate	15			—			—
Intersegment elimination ¹	(125		)	(110		)	(98		)
Total revenue	$	6,258		$	6,063		$	5,661

Operating Profit
(in millions)	2018			2017			2016
Ratings²	$	1,530		$	1,517		$	1,256
Market Intelligence³	545			457			729
Platts ⁴	383			326			1,090
Indices ⁵	563			478			413
Total reportable segments	3,021			2,778			3,488
Corporate Unallocated ⁶	(231		)	(195		)	(147		)
Total operating profit	$	2,790		$	2,583		$	3,341


¹	Revenue for Ratings and expenses for Market Intelligence include an intersegment royalty charged to Market Intelligence for the rights to use and distribute content and data developed by Ratings.

Operating profit for the year ended December 31, 2018 includes legal settlement expenses of $74 million and employee severance charges of $8 million. Operating profit for the year ended December 31, 2017 includes legal settlement expenses of $55 million and employee severance charges of $25 million. Operating profit for the year ended December 31, 2016 primarily includes a benefit related to net legal settlement insurance recoveries of $10 million and employee severance charges of $6 million. Additionally, operating profit includes amortization of intangibles from acquisitions of $2 million, $4 million $5 million for the years ended December 31, 2018, 2017 and 2016, respectively.

Operating profit for the year ended December 31, 2018 includes restructuring charges related to a business disposition and employee severance charges of $7 million. Operating profit for the year ended December 31, 2017 includes employee severance charges of $7 million, and non-cash disposition-related adjustments of $4 million. Operating profit for the year ended December 31, 2016 includes a $373 million gain from our dispositions, disposition-related costs of $43 million, a technology-related impairment charge of $24 million and an acquisition-related cost of $1 million. Additionally, operating profit includes amortization of intangibles from acquisitions of $73 million, $71 million and $72 million for the years ended December 31, 2018, 2017 and 2016, respectively.

⁴

Operating profit for the year ended December 31, 2017 includes non-cash acquisition-related adjustment of $11 million, a charge to exit a leased facility of $6 million, an asset write-off of $2 million, and employee severance charges of $2 million. Operating profit for the year ended December 31, 2016 includes a $728 million gain from our dispositions and disposition-related costs of $5 million. Additionally, Operating profit includes amortization of intangibles from acquisitions of $18 million for the years ended December 31, 2018 and 2017 and $14 million for the year ended December 31, 2016.


⁵	Operating profit includes amortization of intangibles from acquisitions of $6 million for the years ended December 31, 2018, 2017 and 2016, respectively.

⁶

Corporate Unallocated operating loss for the year ended December 31, 2018 includes Kensho retention related expense of $31 million, lease impairments of $11 million and employee severance charges of $10 million. Corporate Unallocated operating loss for the year ended December 31, 2017 includes a charge to exit leased facilities of $19 million and employee severance charges of $10 million. The year ended December 31, 2016 includes $3 million from a disposition-related reserve release. Additionally, Corporate Unallocated operating loss includes amortization of intangibles from acquisitions of $23 million for the year December 31, 2018.



(in millions)	Depreciation & Amortization						Capital Expenditures
	2018		2017		2016		2018		2017		2016
Ratings	$	32	$	34	$	34	$	42	$	45	$	42
Market Intelligence	99		104		105		30		37		40
Platts	27		25		26		9		15		17
Indices	9		8		8		3		3		3
Total reportable segments	167		171		173		84		100		102
Corporate	39		9		8		29		23		13
Total	$	206	$	180	$	181	$	113	$	123	$	115

Segment information as of December 31 is as follows:



(in millions)	Total Assets
	2018		2017
Ratings	$	680	$	788
Market Intelligence	3,606		3,381
Platts	787		791
Indices	1,443		1,270
Total reportable segments	6,516		6,230
Corporate ¹	2,928		3,190
Assets held for sale ²	14		5
Total	$	9,458	$	9,425


¹	Corporate assets consist principally of cash and cash equivalents, goodwill and other intangible assets, assets for pension benefits, deferred income taxes and leasehold improvements related to subleased areas.


²	Includes East Windsor and New Jersey facility as of December 31, 2018 and 2017, respectively.

We do not have operations in any foreign country that represent more than 8% of our consolidated revenue. Transfers between geographic areas are recorded at agreed upon prices and intercompany revenue and profit are eliminated. No single customer accounted for more than 10% of our consolidated revenue.

The following provides revenue and long-lived assets by geographic region:



(in millions)	Revenue						Long-lived Assets
	Year ended December 31,						December 31,
	2018		2017		2016		2018		2017
U.S.	$	3,750	$	3,658	$	3,461	$	5,019	$	4,285
European region	1,543		1,473		1,330		317		346
Asia	647		594		575		51		54
Rest of the world	318		338		295		42		49
Total	$	6,258	$	6,063	$	5,661	$	5,429	$	4,734



	Revenue						Long-lived Assets
	Year ended December 31,						December 31,
	2018		2017		2016		2018		2017
U.S.	60	%	60	%	61	%	92	%	91	%
European region	25		24		24		6		7
Asia	10		10		10		1		1
Rest of the world	5		6		5		1		1
Total	100	%	100	%	100	%	100	%	100	%

See Note 2 – Acquisitions and Divestitures and Note 11 – Restructuring, for actions that impacted the segment operating results.