Note 11—Reportable Business Segments and International Operations

The Company has two reportable business segments: (i) Interconnect Products and Assemblies and (ii) Cable Products and Solutions. The Company organizes its reportable business segments based upon similar economic characteristics and business groupings of products, services, and customers. These reportable business segments are determined based upon how the Company reviews its businesses, assesses operating performance and makes investing and resource allocation decisions. The Interconnect Products and Assemblies segment primarily designs, manufactures and markets a broad range of connector and connector systems, value-add products and other products, including antennas and sensors, used in a broad range of applications in a diverse set of end markets. The Cable Products and Solutions segment primarily designs, manufactures and markets cable, value-add products and components for use primarily in the broadband communications and information technology markets as well as certain applications in other markets. The accounting policies of the segments are the same as those for the Company as a whole and are described in Note 1 herein. The Company evaluates the performance of business units on, among other things, profit or loss from operations before interest, headquarters’ expense allocations, stock-based compensation expense, income taxes, amortization related to certain intangible assets and nonrecurring gains and losses.


	Interconnect Products						Cable Products						Total Reportable
	and Assemblies						and Solutions						Business Segments
	2017		2016		2015		2017		2016		2015		2017		2016		2015
Net sales:
External	$	6,606.9	$	5,922.3	$	5,239.1	$	404.4	$	364.1	$	329.6	$	7,011.3	$	6,286.4	$	5,568.7
Intersegment		9.7		6.9		7.2		40.7		30.0		21.6		50.4		36.9		28.8
Depreciation and amortization		214.7		206.8		162.3		6.3		4.9		3.0		221.0		211.7		165.3
Segment operating income		1,475.2		1,280.3		1,158.3		54.2		52.8		40.3		1,529.4		1,333.1		1,198.6
Segment assets (excluding goodwill)		5,732.6		4,587.5		4,580.4		200.3		197.1		163.5		5,932.9		4,784.6		4,743.9
Capital expenditures		220.4		186.2		167.1		5.6		4.0		4.5		226.0		190.2		171.6

Reconciliation of segment operating income to consolidated income before income taxes:


	2017		2016		2015

Segment operating income	$	1,529.4	$	1,333.1	$	1,198.6
Interest expense		(92.3)		(72.6)		(68.3)
Other income, net		17.1		8.5		16.4
Stock-based compensation expense		(49.7)		(47.6)		(44.2)
Acquisition-related expenses		(4.0)		(36.6)		(5.7)
Other operating expenses		(48.1)		(43.7)		(44.0)
Income before income taxes	$	1,352.4	$	1,141.1	$	1,052.8

Reconciliation of segment assets to consolidated total assets:


	2017		2016
Segment assets, excluding goodwill	$	5,932.9	$	4,784.6
Goodwill		4,042.6		3,678.8
Other assets		28.4		35.3
Consolidated total assets	$	10,003.9	$	8,498.7

Net sales by geographic area for the years ended December 31, 2017, 2016 and 2015 and property, plant and equipment, net by geographic area as of December 31 were as follows:


	2017		2016		2015
Net sales
United States	$	1,978.4	$	1,740.7	$	1,696.3
China		2,067.3		1,865.6		1,675.5
Other international locations		2,965.6		2,680.1		2,196.9
Total	$	7,011.3	$	6,286.4	$	5,568.7

Property, plant and equipment, net
United States	$	212.7	$	209.2	$	214.4
China		244.7		200.1		151.4
Other international locations		359.4		302.1		243.7
Total	$	816.8	$	711.4	$	609.5

Net sales by geographic area are based on the customer location to which the product is shipped. No single customer represented 10% or more of the Company’s net sales for the years ended December 31, 2017 and 2016. During the year ended December 31, 2015, aggregate sales to the Company’s largest customer, including sales of products to EMS companies and subcontractors that the Company believes are manufacturing products on their behalf, represented approximately 11% of the Company’s net sales, all of which are included within the Interconnect Products and Assemblies segment. It is impracticable to disclose net sales by product or group of products.