22. Business Segment Reporting

Upon consummation of the Merger with Nationstar, the Company has identified four reportable segments: Servicing, Originations, Xome and Corporate/Other. The Company’s segments are based upon the Company’s organizational structure which focuses primarily on the services offered. Corporate functional expenses are allocated to individual segments based on actual cost of services performed based on a direct resource utilization, estimate of percentage use for shared services or headcount percentage for certain functions. Facility costs are allocated to individual segments based on cost per headcount for specific facilities utilized. Group insurance costs are allocated to individual segments based on global cost per headcount. Non-allocated corporate expenses include the administrative costs of executive management and other corporate functions that are not directly attributable to Company’s operating segments. Revenues generated on inter-segment services performed are valued based on similar services provided to external parties.

The following tables present financial information by segment:



	Successor
	Year Ended December 31, 2019
	Servicing			Originations			Xome		Elimination			Total Operating Segments			Corporate/ Other			Consolidated
Revenues
Service related, net	$	408		$	80		$	422	$	(3	)	$	907		$	2		$	909
Net gain on mortgage loans held for sale	124			963			—		—			1,087			11			1,098
Total revenues	532			1,043			422		(3		)	1,994			13			2,007
Total expenses	690			568			398		(3		)	1,653			198			1,851
Other income (expenses), net:
Interest income	500			98			—		—			598			7			605
Interest expense	(469		)	(98		)	—		—			(567		)	(212		)	(779		)
Other income (expenses), net	4			4			14		—			22			(7		)	15
Total other income (expenses), net	35			4			14		—			53			(212		)	(159		)
(Loss) income before income tax (benefit) expense	$	(123	)	$	479		$	38	$	—		$	394		$	(397	)	$	(3	)
Depreciation and amortization for property and equipment and intangible assets	$	19		$	18		$	14	$	—		$	51		$	40		$	91
Total assets	$	11,044		$	9,257		$	526	$	(4,826	)	$	16,001		$	2,304		$	18,305



	Successor
	Five Months Ended December 31, 2018
	Servicing			Originations			Xome			Elimination			Total Operating Segments			Corporate/ Other			Consolidated
Revenues
Service related, net	$	217		$	24		$	177		$	—		$	418		$	—		$	418
Net gain on mortgage loans held for sale	19			157			—			—			176			—			176
Total revenues	236			181			177			—			594			—			594
Total expenses	303			155			178			—			636			71			707
Other income (expenses), net:
Interest income	222			27			—			—			249			7			256
Interest expense	(173		)	(26		)	(1		)	—			(200		)	(93		)	(293		)
Other income, net	6			5			1			—			12			1			13
Total other income (expenses), net	55			6			—			—			61			(85		)	(24		)
(Loss) income before income tax (benefit) expense	$	(12	)	$	32		$	(1	)	$	—		$	19		$	(156	)	$	(137	)
Depreciation and amortization for property and equipment and intangible assets	$	9		$	5		$	5		$	—		$	19		$	20		$	39
Total assets	$	13,485		$	4,866		$	493		$	(3,772	)	$	15,072		$	1,901		$	16,973



	Predecessor
	Seven Months Ended July 31, 2018
	Servicing			Originations			Xome		Elimination/ Reclassification⁽¹⁾			Total Operating Segments			Corporate/ Other			Consolidated
Revenues
Service related, net	$	740		$	36		$	149	$	(25	)	$	900		$	1		$	901
Net gain on mortgage loans held for sale	—			270			—		25			295			—			295
Total revenues	740			306			149		—			1,195			1			1,196
Total expenses	474			245			123		—			842			103			945
Other income (expenses), net:
Interest income	288			38			—		—			326			7			333
Interest expense	(268		)	(37		)	—		—			(305		)	(83		)	(388		)
Other (expenses) income, net	(1		)	—			9		—			8			(2		)	6
Total other income (expenses), net	19			1			9		—			29			(78		)	(49		)
Income (loss) before income tax expense (benefit)	$	285		$	62		$	35	$	—		$	382		$	(180	)	$	202
Depreciation and amortization for property and equipment and intangible assets	$	15		$	7		$	7	$	—		$	29		$	4		$	33
Total assets	$	14,578		$	4,701		$	425	$	(3,591	)	$	16,113		$	913		$	17,026



	Predecessor
	Year Ended December 31, 2017
	Servicing⁽¹⁾			Originations			Xome		Elimination/ Reclassification⁽¹⁾			Total Operating Segments			Corporate/ Other			Consolidated
Revenues
Service related, net	$	766		$	63		$	291	$	(79	)	$	1,041		$	2		$	1,043
Net gain on mortgage loans held for sale	—			528			—		79			607			—			607
Total revenues	766			591			291		—			1,648			2			1,650
Total expenses	691			439			247		—			1,377			98			1,475
Other income (expenses), net:
Interest income	527			55			—		—			582			15			597
Interest expense	(523		)	(54		)	—		—			(577		)	(154		)	(731		)
Other (expenses) income, net	(3		)	—			9		—			6			(3		)	3
Total other income (expenses), net	1			1			9		—			11			(142		)	(131		)
Income (loss) before income tax expense (benefit)	$	76		$	153		$	53	$	—		$	282		$	(238	)	$	44
Depreciation and amortization for property and equipment and intangible assets	$	23		$	10		$	14	$	—		$	47		$	12		$	59
Total assets	$	15,006		$	4,935		$	393	$	(3,117	)	$	17,217		$	819		$	18,036

⁽¹⁾

For the Predecessor’s Servicing segment results purposes, all revenue is attributable to servicing the portfolio. Therefore, $25 and $79 of net gain on mortgage loans was moved to revenues - service related, net during the seven months ended July 31, 2018 and the year ended December 31, 2017, respectively. For consolidated results purposes, these amounts were reclassed to net gain on mortgage loans held for sale.