Segment Reporting:

The products of Altria Group, Inc.’s subsidiaries include smokeable tobacco products, consisting of cigarettes manufactured and sold by PM USA and Nat Sherman, machine-made large cigars and pipe tobacco manufactured and sold by Middleton and premium cigars sold by Nat Sherman; smokeless tobacco products manufactured and sold by USSTC; and wine produced and/or distributed by Ste. Michelle. The products and services of these subsidiaries constitute Altria Group, Inc.’s reportable segments of smokeable products, smokeless products and wine. The financial services and the innovative tobacco products businesses are included in all other.

Altria Group, Inc.’s chief operating decision maker (the “CODM”) reviews operating companies income to evaluate the performance of, and allocate resources to, the segments. Operating companies income for the segments is defined as operating income before general corporate expenses and amortization of intangibles. Interest and other debt expense, net, and provision for income taxes are centrally managed at the corporate level and, accordingly, such items are not presented by segment since they are excluded from the measure of segment profitability reviewed by the CODM.

Segment data were as follows:



	For the Nine Months Ended September 30,						For the Three Months Ended September 30,
	2017			2016			2017			2016
	(in millions)
Net revenues:
Smokeable products	$	17,355		$	17,398		$	5,975		$	6,147
Smokeless products	1,580			1,530			550			528
Wine	471			498			181			182
All other	69			66			23			48
Net revenues	$	19,475		$	19,492		$	6,729		$	6,905
Earnings before income taxes:
Operating companies income (loss):
Smokeable products	$	6,564		$	5,955		$	2,290		$	2,086
Smokeless products	951			930			352			312
Wine	82			100			36			38
All other	(31		)	(46		)	(10		)	8
Amortization of intangibles	(15		)	(15		)	(5		)	(5		)
General corporate expenses	(158		)	(150		)	(56		)	(57		)
Corporate asset impairment and exit costs	—			(5		)	—			—
Operating income	7,393			6,769			2,607			2,382
Interest and other debt expense, net	(525		)	(571		)	(169		)	(179		)
Loss on early extinguishment of debt	—			(823		)	—			(823		)
Earnings from equity investment in AB InBev/SABMiller	332			564			169			299
Gain on AB InBev/SABMiller business combination	445			205			37			48
Earnings before income taxes	$	7,645		$	6,144		$	2,644		$	1,727

The comparability of operating companies income for the reportable segments was affected by the following:

Tobacco and Health Litigation Items - Pre-tax charges related to certain tobacco and health litigation items were recorded in Altria Group, Inc.’s condensed consolidated statements of earnings as follows:



	For the Nine Months Ended September 30,				For the Three Months Ended September 30,
	2017		2016		2017		2016
	(in millions)
Smokeable products segment	$	16	$	72	$	—	$	45
Interest and other debt expense, net	2		16		—		—
Total	$	18	$	88	$	—	$	45

During the second quarter of 2017, PM USA recorded pre-tax charges related to four Engle progeny cases of $15 million in marketing, administration and research costs and $2 million in interest costs related to those cases. For further discussion, see Smoking and Health Litigation in Note 9. Contingencies.

During the third quarter of 2016, PM USA recorded a pre-tax charge related to the Miner case of $45 million in marketing, administration and research costs. During the first quarter of 2016, PM USA recorded pre-tax charges, primarily related to the Aspinall case, of $26 million in marketing, administration and research costs and $12 million in interest costs. For further discussion, see “Lights/Ultra Lights” Cases - State Trial Court Class Certification Settlements in Note 9. Contingencies.

Smokeless Products Recall - During the first quarter of 2017, USSTC voluntarily recalled certain smokeless tobacco products manufactured at its Franklin Park, Illinois facility due to a product tampering incident (the “Recall”). USSTC estimates that the Recall-related costs and the share impact from the Recall reduced smokeless products segment operating companies income by approximately $60 million in the first quarter of 2017.

Asset Impairment, Exit and Implementation Costs - See Note 2. Asset Impairment, Exit and Implementation Costs for a breakdown of these costs by segment.