Segment Reporting and Major Customers (Tables)

6 Months Ended

Jun. 30, 2017

Segment Reporting, including Geographic Area Data and Major Customers

Total Assets by Segment

		As of
(in thousands)		June 30, 2017	December 31, 2016
Issuer Solutions	$	5,881,507	5,892,410
Merchant Solutions		3,198,527	3,295,509
Netspend		1,432,787	1,474,595
Intersegment assets		(4,235,807)	(4,296,337)
Total assets	$	6,277,014	6,366,177

Property and Equipment, Net of Accumulated Depreciation and Amortization by Geographic Areas

	As of
(in thousands)	June 30, 2017		December 31, 2016
United States	$	232,025	236,913
Europe		41,840	38,866
Other		6,771	6,566
Total	$	280,636	282,345

Depreciation and Amortization by segment

	Three months ended June 30,			Six months ended June 30,
(in thousands)		2017	2016		2017	2016
Depreciation and amortization by segment:
Issuer Solutions	$	35,735	35,649		72,588	71,268
Merchant Solutions		7,380	6,805		14,402	11,856
Netspend		4,180	3,116		8,272	6,224
Depreciation and amortization		47,295	45,570		95,262	89,348
Acquisition intangible amortization		50,943	58,486		106,111	81,407
Corporate Administration and Other		1,121	913		2,164	1,797
Total depreciation and amortization	$	99,359	104,969		203,537	172,552

Reconciliation of Geographic Revenues to External Revenues by Operating Segments

	Three months ended June 30, 2017
(in thousands)	Issuer Solutions		Merchant Solutions	Netspend	Total
United States	$	258,120	607,663	182,637	$	1,048,420
Europe1		86,433	59	-		86,492
Canada1		78,761	346	-		79,107
Other1		8,051	305	-		8,356
Total	$	431,365	608,373	182,637	$	1,222,375

	Six months ended June 30, 2017
(in thousands)	Issuer Solutions		Merchant Solutions	Netspend	Total
United States	$	518,849	1,170,771	379,695	$	2,069,315
Europe1		156,548	138	-		156,686
Canada1		154,956	623	-		155,579
Other1		24,894	626	-		25,520
Total	$	855,247	1,172,158	379,695	$	2,407,100

	Three months ended June 30, 2016
(in thousands)	Issuer Solutions		Merchant Solutions	Netspend		Total
United States	$	263,292	567,258	161,941	$	992,491
Europe1		75,160	-	-		75,160
Canada1		73,072	65	-		73,137
Other1		10,587	212	-		10,799
Total	$	422,111	567,535	161,941	$	1,151,587

	Six months ended June 30, 2016
(in thousands)	Issuer Solutions		Merchant Solutions	Netspend	Total
United States	$	520,941	704,978	346,139	$	1,572,058
Europe1		144,973	-	-		144,973
Canada1		142,922	130	-		143,052
Other1		30,476	406	-		30,882
Total	$	839,312	705,514	346,139	$	1,890,965

1Certain of these revenues are impacted by movements in foreign currency exchange rates.

Operating Segments

Operating Segments	Three months ended June 30,			Six months ended June 30,
(in thousands)		2017	2016	2017	2016
Adjusted operating income by segment1:
Issuer Solutions (a)	$	147,277	128,493	281,150	263,570
Merchant Solutions (b)		101,996	89,915	193,275	128,272
Netspend (c)		46,044	42,481	94,692	84,682
Corporate Administration and Other		(36,036)	(33,340)	(71,608)	(62,808)
Adjusted segment operating income (d)		259,281	227,549	497,509	413,716
Less:
Share-based compensation		11,008	12,566	20,055	20,723
TransFirst M&A and integration expenses2		4,165	20,676	9,034	24,078
Litigation, claims, judgments or settlements		(83)	-	1,878	-
Acquisition intangible amortization		50,943	58,486	106,111	81,407
Operating income		193,248	135,821	360,431	287,508
Nonoperating expenses, net		(30,042)	(29,760)	(59,945)	(51,857)
Income before income taxes and equity in income of equity investments	$	163,206	106,061	300,486	235,651
Net revenue by segment:
Issuer Solutions (e)	$	392,760	377,862	780,015	755,871
Merchant Solutions (f)		278,588	261,467	539,149	382,079
Netspend (g)		183,065	162,620	380,530	347,613
Segment net revenue		854,413	801,949	1,699,694	1,485,563
Less: Intersegment revenues		10,345	7,012	22,734	18,982
Net revenue3 (h)		844,068	794,937	1,676,960	1,466,581
Add: reimbursable items, interchange and assessments expenses		378,307	356,650	730,140	424,384
Total revenues	$	1,222,375	1,151,587	2,407,100	1,890,965
Adjusted segment operating margin on segment net revenue:
Issuer Solutions (a)/(e)		37.5%	34.0%	36.0%	34.9%
Merchant Solutions (b)/(f)		36.6%	34.4%	35.9%	33.6%
Netspend (c)/(g)		25.2%	26.1%	24.9%	24.4%
Adjusted segment operating margin on net revenue: (d)/(h)		30.7%	28.6%	29.7%	28.2%

¹ Adjusted segment operating income excludes acquisition intangible amortization, TransFirst M&A and integration expenses, share-based compensation and expenses associated with Corporate Administration and Other.

² Excludes share-based compensation

³ Net revenue is defined as total revenues less reimbursable items (such as postage), as well as, merchant acquiring interchange and assessment fees charged by the card associations or payment networks that are recorded by TSYS as expense.