

10.	Segment Information

Reportable Segments

We have two reportable segments, Wireless and Wireline, which we operate and manage as strategic business units and organize by products and services, and customer groups, respectively. We measure and evaluate our reportable segments based on segment operating income, consistent with the chief operating decision maker’s assessment of segment performance.

Our segments and their principal activities consist of the following:



Segment	Description
Wireless	Wireless’ communications products and services include wireless voice and data services and equipment sales, which are provided to consumer, business and government customers across the U.S.
Wireline	Wireline’s communications products and enhanced services include video and data services, corporate networking solutions, security and managed network services and local and long distance voice services. We provide these products and services to consumers in the U.S., as well as to carriers, businesses and government customers both in the U.S. and around the world.

The Wireline segment is organized in four customer groups: Consumer Markets, which includes consumer retail customers; Enterprise Solutions, which includes large business customers, including multinational corporations, and federal government customers; Partner Solutions, which includes other carriers that use our facilities to provide services to their customers; and Business Markets, which includes U.S.-based small and medium business customers, state and local governments, and educational institutions.

Corporate and other includes the results of our Media business, branded Oath, our telematics business, branded Verizon Connect, and other businesses, investments in unconsolidated businesses, unallocated corporate expenses, pension and other employee benefit related costs and lease financing. Corporate and other also includes the historical results of divested businesses and other adjustments and gains and losses that are not allocated in assessing segment performance due to their nature. Although such transactions are excluded from the business segment results, they are included in reported consolidated earnings. Gains and losses from these transactions that are not individually significant are included in segment results as these items are included in the chief operating decision maker’s assessment of segment performance.

We completed our acquisition of Yahoo's operating business in June 2017.

In May 2017, we completed the Data Center Sale, where we sold 23 customer-facing data center sites in the U.S. and Latin America to Equinix Inc. The results of operations for this divestiture and other insignificant transactions are included within Corporate and other for all periods presented to reflect comparable segment operating results consistent with the information regularly reviewed by our chief operating decision maker.

The reconciliation of segment operating revenues and expenses to consolidated operating revenues and expenses below includes the effects of special items that management does not consider in assessing segment performance, primarily because of their nature.

We have adjusted prior period consolidated and segment information, where applicable, to conform to the current period presentation. On January 1, 2018, we adopted ASU 2017-07, "Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost." Components other than the service component of net periodic benefit cost (income), inclusive of the mark-to-market pension and benefit remeasurements, have been reclassified from operating to non-operating charges (benefits) in our condensed consolidated statements of income. The adoption of ASU 2017-07 did not change how we present our segment results.

The following table provides operating financial information for our two reportable segments:



	Three Months Ended					Nine Months Ended
	September 30,					September 30,
(dollars in millions)	2018			2017		2018		2017
External Operating Revenues
Wireless
Service	$	15,949		$	15,823	$	47,062	$	47,158
Equipment	5,353			4,352		15,437		12,414
Other	1,588			1,328		4,571		3,916
Total Wireless	22,890			21,503		67,070		63,488

Wireline
Consumer Markets	3,138			3,203		9,418		9,588
Enterprise Solutions	2,170			2,262		6,620		6,881
Partner Solutions	914			997		2,840		2,993
Business Markets	839			903		2,562		2,700
Other	55			48		188		183
Total Wireline	7,116			7,413		21,628		22,345
Total reportable segments	$	30,006		$	28,916	$	88,698	$	85,833

Intersegment Revenues
Wireless	$	85		$	77	$	253	$	252
Wireline	253			249		758		718
Total reportable segments	$	338		$	326	$	1,011	$	970

Total Operating Revenues
Wireless	$	22,973		$	21,580	$	67,322	$	63,740
Wireline	7,371			7,662		22,387		23,063
Total reportable segments	$	30,344		$	29,242	$	89,709	$	86,803

Operating Income (Loss)
Wireless	$	8,511		$	7,603	$	24,834	$	22,089
Wireline	(50		)	65		—		318
Total reportable segments	$	8,461		$	7,668	$	24,834	$	22,407

The following table provides asset information for our reportable segments:



	At September 30,			At December 31,
(dollars in millions)	2018			2017
Assets
Wireless	$	260,056		$	235,873
Wireline	78,361			75,282
Total reportable segments	338,417			311,155
Corporate and other	241,555			239,040
Eliminations	(314,410		)	(293,052		)
Total consolidated - reported	$	265,562		$	257,143

A reconciliation of the reportable segment operating revenues to consolidated operating revenues is as follows:



	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(dollars in millions)	2018			2017			2018			2017
Total reportable segment operating revenues	$	30,344		$	29,242		$	89,709		$	86,803
Corporate and other	2,655			2,796			8,046			6,034
Eliminations	(392		)	(375		)	(1,173		)	(1,126		)
Operating results from divested businesses	—			54			—			368
Total consolidated operating revenues	$	32,607		$	31,717		$	96,582		$	92,079

Fios revenues are included within our Wireline segment and amounted to approximately $3.0 billion and $8.9 billion for the three and nine months ended September 30, 2018, respectively. Fios revenues amounted to approximately $2.9 billion and $8.7 billion for the three and nine months ended September 30, 2017, respectively.

A reconciliation of the total of the reportable segments’ operating income to consolidated income before provision for income taxes is as follows:



	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(dollars in millions)	2018			2017			2018			2017
Total reportable segment operating income	$	8,461		$	7,668		$	24,834		$	22,407
Corporate and other	39			(313		)	(842		)	(912		)
Severance charges (Note 8)	—			—			(339		)	(195		)
Other components of net periodic benefit credit (Note 8)	(688		)	(218		)	(1,197		)	(655		)
Gain on spectrum license transaction (Note 3)	—			—			—			126
Acquisition and integration related charges (Note 3)	(137		)	(166		)	(364		)	(730		)
Product realignment charges	—			—			(451		)	—
Net gain on sale of divested businesses	—			—			—			1,774
Operating results from divested businesses	—			17			—			149
Total consolidated operating income	7,675			6,988			21,641			21,964

Equity in losses of unconsolidated businesses	(3		)	(22		)	(250		)	(71		)
Other income (expense), net	214			(291		)	499			(719		)
Interest expense	(1,211		)	(1,164		)	(3,634		)	(3,514		)
Income Before Provision For Income Taxes	$	6,675		$	5,511		$	18,256		$	17,660

No single customer accounted for more than 10% of our total operating revenues during the three and nine months ended September 30, 2018 and 2017.