Segment Information (Text Block)

12 Months Ended

Dec. 31, 2016

Segment Reporting [Abstract]

Segment Information [Text Block]

Segment Information

We operate under the Itron brand worldwide and manage and report under three operating segments, Electricity, Gas, and Water. Our Water operating segment includes both our global water and heat solutions. This structure allows each segment to develop its own go-to-market strategy, prioritize its marketing and product development requirements, and focus on its strategic investments. Our sales, marketing, and delivery functions are managed under each segment. Our product development and manufacturing operations are managed on a worldwide basis to promote a global perspective in our operations and processes and yet still maintain alignment with the segments.

We have three GAAP measures of segment performance: revenues, gross profit (margin), and operating income (margin). Our operating segments have distinct products, and, therefore, intersegment revenues are minimal. Certain operating expenses are allocated to the operating segments based upon internally established allocation methodologies. Corporate operating expenses, interest income, interest expense, other income (expense), and income tax provision are not allocated to the segments, nor are included in the measure of segment profit or loss. In addition, we allocate only certain production assets and intangible assets to our operating segments. We do not manage the performance of the segments on a balance sheet basis.

Segment Products

Electricity	Standard electricity (electromechanical and electronic) meters; smart metering solutions that include one or several of the following: smart electricity meters; smart electricity communication modules; prepayment systems, including smart key, keypad, and smart card communication technologies; smart systems including handheld, mobile, and fixed network collection technologies; smart network technologies; meter data management software; knowledge application solutions; installation; implementation; and professional services including consulting and analysis.
Gas	Standard gas meters; smart metering solutions that include one or several of the following: smart gas meters; smart gas communication modules; prepayment systems, including smart key, keypad, and smart card communication technologies; smart systems, including handheld, mobile, and fixed network collection technologies; smart network technologies; meter data management software; knowledge application solutions installation; implementation; and professional services including consulting and analysis.
Water	Standard water and heat meters; smart metering solutions that include one or several of the following: smart water meters and communication modules; smart heat meters; smart systems including handheld, mobile, and fixed network collection technologies; meter data management software; knowledge application solutions; installation; implementation; and professional services including consulting and analysis.

Revenues, gross profit, and operating income associated with our segments were as follows:

	Year Ended December 31,
	2016			2015			2014
	(in thousands)
Revenues
Electricity	$	938,374		$	820,306		$	771,857
Gas	569,476			543,805			599,091
Water	505,336			519,422			576,668
Total Company	$	2,013,186		$	1,883,533		$	1,947,616
Gross profit
Electricity	$	282,677		$	225,446		$	200,249
Gas	205,063			185,559			211,623
Water	172,580			145,680			202,178
Total Company	$	660,320		$	556,685		$	614,050
Operating income (loss)
Electricity	$	68,287		$	31,104		$	(77,751	)
Gas	66,813			67,471			76,101
Water	37,266			19,864			71,356
Corporate unallocated	(76,155		)	(65,593		)	(69,226		)
Total Company	96,211			52,846			480
Total other income (expense)	(11,584		)	(15,744		)	(18,745		)
Income (loss) before income taxes	$	84,627		$	37,102		$	(18,265	)

During the second quarter of 2015, we concluded it was necessary to issue a product replacement notification to customers of our Water segment who had purchased certain communication modules manufactured between July 2013 and December 2014. We determined that a component of the modules was failing prematurely. This resulted in a decrease to gross profit of $29.4 million for the year ended December 31, 2015. After adjusting for the tax impact, this charge resulted in a decrease to basic and diluted EPS of $0.47 for the year ended December 31, 2015.

During 2014, in our Electricity segment, we revised our estimate of the cost to complete an OpenWay project in North America. This resulted in a decrease to gross profit of $15.9 million, which decreased basic and diluted EPS by $0.25 for the year ended December 31, 2014.

For the years ended December 31, 2016, 2015, and 2014, no single customer represented more than 10% of total Company or the Gas or Water operating segment revenues. Two customers represented 12% and 10% of total Electricity revenue, respectively, for the year ended December 31, 2016. No customer represented more than 10% of Electricity revenue for the years ended December 31, 2015 and 2014.

Revenues by region were as follows:

	Year Ended December 31,
	2016		2015		2014
	(in thousands)
United States and Canada	$	1,126,787	$	997,293	$	875,796
Europe, Middle East, and Africa (EMEA)	698,106		701,301		849,841
Other	188,293		184,939		221,979
Total Company	$	2,013,186	$	1,883,533	$	1,947,616

Revenues are allocated to countries and regions based on the location of the selling entity.

Property, plant, and equipment, net, by geographic area were as follows:

	At December 31,
	2016		2015
	(in thousands)
United States	$	70,435	$	72,179
Outside United States	106,023		118,077
Total Company	$	176,458	$	190,256

Depreciation and amortization expense associated with our segments was as follows:

	Year Ended December 31,
	2016		2015		2014
	(in thousands)
Electricity	$	28,468	$	35,896	$	47,889
Gas	20,714		20,288		25,706
Water	18,675		19,459		24,257
Corporate Unallocated	461		350		287
Total Company	$	68,318	$	75,993	$	98,139