Business Segments and Enterprise-Wide Information

12 Months Ended

Dec. 31, 2015

Segment Reporting [Abstract]

Business Segments and Enterprise-Wide Information

Note 14: Business Segments and Enterprise-Wide Information

Management, including our chief operating decision maker, who is our CEO, evaluates the performances of our business segments primarily on segment revenue and segment operating income (loss) before depreciation, amortization and other, and share-based compensation granted to executives, non-employee directors and employees (“segment operating income (loss)”). Segment operating income (loss) contains internally allocated costs of our shared service support functions, including but not limited to, corporate executive management, business development, sales, finance, legal, human resources, information technology and risk management. We also review depreciation and amortization allocated to each segment. Share-based payments expense related to share-based compensation granted to executives, non-employee directors and employees and expense related to the rights to receive cash issued in connection with our acquisition of ecoATM are not allocated to our segments and are included in the Corporate Unallocated column in the analysis and reconciliation below; however, share-based payments expense related to our content arrangements with certain movie studios has been allocated to our Redbox segment and is included within direct operating expenses. Our performance evaluation does not include segment assets.

Changes in our Organizational Structure

We regularly assess the performance of our concepts to determine whether continued funding or other alternatives are appropriate and as a result, we discontinued operating SAMPLEit in the fourth quarter of 2015. AsSAMPLEit did not represent a major component of our operations or financial results, the results of SAMPLEit did not qualify to be reported as a discontinued operation and remain in our All Other reporting category.

During the first quarter of 2015, we added ecoATM, our electronic device recycling business, as a separate reportable segment. Previously, the results of ecoATM along with those of other self-service concepts were included in our former New Ventures segment. The combined results of the other self-service concepts are now included in our All Other reporting category in the reconciliation below, as they do not meet quantitative thresholds to be reported as a separate segment. All goodwill previously allocated to the New Ventures segment has been allocated to the ecoATM segment. See Note 6: Goodwill and Other Intangible Assetsfor further information.

Results of operations for Gazelle from the acquisition date, November 10, 2015, are included in our ecoATM segment. See Note 3: Business Combinationsfor further information.

On July 23, 2013, we completed the acquisition of ecoATM. Prior to July 23, 2013 we held a non-controlling equity interest in ecoATM and reported our share of ecoATM's operating results in loss from equity method investments in our Consolidated Statements of Comprehensive Income. Subsequent to our acquisition of ecoATM on July 23, 2013, the assets acquired and liabilities assumed, as well as the results of operations, with the exception of expense for rights to receive cash which are unallocated corporate expenses, are included in our ecoATM segment.

Comparability of Segment Results

We have recast prior period results for the following:

• Discontinued operations, consisting of our Redbox operations in Canada which we shut down during the first quarter of 2015. See Note 12: Discontinued Operationsfor further information; and

• The addition of our ecoATM segment and our All Other reporting category, which we added during the first quarter of 2015.

Our analysis and reconciliation of our segment information to the consolidated financial statements that follows covers our results of operations, which consists of our Redbox, Coinstar and ecoATM segments, Corporate Unallocated expenses and our All Other reporting category. All Other includes the results of other self-service concepts, which we regularly assess to determine whether continued funding or other alternatives are appropriate.

Dollars in thousands
Year Ended December 31, 2015	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,760,899		$	318,611		$	113,558		$	143		$	—		$	2,193,211
Expenses:
Direct operating	1,213,744			159,211			113,141			4,431			2,561			1,493,088
Marketing	19,804			5,566			8,481			1,128			695			35,674
Research and development	—			—			5,545			(84		)	1,737			7,198
General and administrative	129,013			31,561			10,875			7,188			11,756			190,393
Restructuring and related costs (Note 11)	23,540			2,076			687			850			—			27,153
Goodwill impairment (Note 6)	—			—			85,890			—			—			85,890
Segment operating income (loss)	374,798			120,197			(111,061		)	(13,370		)	(16,749		)	353,815
Less: depreciation and amortization	(118,902		)	(31,871		)	(26,382		)	(7,785		)	—			(184,940		)
Operating income (loss)	255,896			88,326			(137,443		)	(21,155		)	(16,749		)	168,875
Loss from equity method investments, net	—			—			—			—			(800		)	(800		)
Interest expense, net	—			—			—			—			(42,353		)	(42,353		)
Other, net	—			—			—			—			(2,657		)	(2,657		)
Income (loss) from continuing operations before income taxes	$	255,896		$	88,326		$	(137,443	)	$	(21,155	)	$	(62,559	)	$	123,065

Dollars in thousands
Year Ended December 31, 2014	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,881,718		$	315,628		$	94,187		$	53		$	—		$	2,291,586
Expenses:
Direct operating	1,318,509			161,214			92,182			2,821			6,585			1,581,311
Marketing	20,969			6,346			3,513			1,272			3,193			35,293
Research and development	120			531			5,691			2,854			3,851			13,047
General and administrative	135,554			26,989			12,773			3,522			11,658			190,496
Restructuring and related costs (Note 11)	534			23			—			—			—			557
Segment operating income (loss)	406,032			120,525			(19,972		)	(10,416		)	(25,287		)	470,882
Less: depreciation and amortization	(149,236		)	(35,471		)	(17,031		)	(740		)	—			(202,478		)
Operating income (loss)	256,796			85,054			(37,003		)	(11,156		)	(25,287		)	268,404
Loss from equity method investments, net	—			—			—			—			(28,734		)	(28,734		)
Interest expense, net	—			—			—			—			(47,644		)	(47,644		)
Other, net	—			—			—			—			(1,185		)	(1,185		)
Income (loss) from continuing operations before income taxes	$	256,796		$	85,054		$	(37,003	)	$	(11,156	)	$	(102,850	)	$	190,841

Dollars in thousands
Year Ended December 31, 2013	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,967,715		$	300,218		$	31,824		$	28		$	—		$	2,299,785
Expenses:
Direct operating	1,365,368			158,562			27,271			2,162			3,636			1,556,999
Marketing	20,835			6,244			938			651			1,559			30,227
Research and development	76			6,962			2,772			1,897			1,375			13,082
General and administrative	160,863			25,220			7,868			7,683			14,164			215,798
Restructuring and related costs (Note 11)	3,771			724			—			—			—			4,495
Segment operating income (loss)	416,802			102,506			(7,025		)	(12,365		)	(20,734		)	479,184
Less: depreciation and amortization	(159,851		)	(33,921		)	(6,077		)	(459		)	—			(200,308		)
Operating income (loss)	256,951			68,585			(13,102		)	(12,824		)	(20,734		)	278,876
Loss from equity method investments, net	—			—			—			—			19,928			19,928
Interest expense, net	—			—			—			—			(32,807		)	(32,807		)
Other, net	—			—			—			—			(3,599		)	(3,599		)
Income (loss) from continuing operations before income taxes	$	256,951		$	68,585		$	(13,102	)	$	(12,824	)	$	(37,212	)	$	262,398

Significant Retailer Relationships

The following retailers accounted for 10% or more of our consolidated revenue:

	Year Ended December 31,
	2015		2014		2013
Wal-Mart Stores Inc.	16.6	%	15.5	%	15.2	%
Walgreen Co.	13.4	%	13.8	%	14.7	%
The Kroger Company	9.8	%	9.8	%	10.0	%

Revenue and Long-lived Assets by Geographic Location

Revenue is allocated to geographic locations based on the location of the kiosk. Revenue by geographic location was as follows:

	Years Ended December 31,
Dollars in thousands	2015		2014		2013
U.S.	$	2,145,887	$	2,242,753	$	2,254,790
All other	47,324		48,833		44,995
Total revenue	$	2,193,211	$	2,291,586	$	2,299,785

Long-lived assets by geographic location were as follows:

	Years Ended December 31,
Dollars in thousands	2015		2014		2013
U.S.	$	848,450	$	1,027,271	$	1,140,224
All other	14,133		33,426		38,406
Total long-lived assets	$	862,583	$	1,060,697	$	1,178,630