| Information jvid视频 jvid视频's Operating Segments |
(9)听听听Information jvid视频 jvid视频's Operating Segments
jvid视频, through its ownership interests in subsidiaries and other companies, is primarily engaged in the video and online commerce industries. jvid视频 identifies its reportable segments as (A)听those operating segments that represent 10% or more of its consolidated annual revenue, annual Adjusted OIBDA (as defined below) or total assets and (B)听those equity method affiliates whose share of earnings represent 10% or more of jvid视频's annual pre-tax earnings.
jvid视频 evaluates performance and makes decisions about allocating resources to its operating segments based on financial measures such as revenue, Adjusted OIBDA, gross margin, average sales price per unit and revenue or sales per customer equivalent. In addition, jvid视频 reviews nonfinancial measures such as unique website visitors, number of units shipped, conversion rates and active customers, as appropriate.
For the nine months ended September听30, 2020, jvid视频 has identified the following operating segments as its reportable segments:
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QxH - 听QVC U.S. and HSN market and sell a wide variety of consumer products in the United States, primarily by means of their televised shopping programs and via the Internet through their websites and mobile applications. |
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QVC International 鈥 QVC International markets and sells a wide variety of consumer products in several foreign countries, primarily by means of its televised shopping programs and via the Internet through its international websites and mobile applications. |
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Zulily 鈥 Zulily markets and sells a wide variety of consumer products in the United States and several foreign countries through flash sales events, primarily through its app, mobile and desktop experiences. |
jvid视频's operating segments are strategic business units that offer different products and services. They are managed separately because each segment requires different technologies, distribution channels and marketing strategies. 听The accounting policies of the segments are the same as those described in the Company's Summary of Significant Accounting Policies in the 2019 10-K.
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Performance Measures
Disaggregated revenue by segment and product category consisted of the following:
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Three months ended |
鈥 |
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September听30, 2020 |
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QxH |
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QVC Int'l |
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Zulily |
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Corp and other |
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Total |
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in millions |
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Home |
鈥 |
$ |
819 |
鈥 |
286 |
鈥 |
115 |
鈥 |
248 |
鈥 |
1,468 |
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Apparel |
鈥 |
鈥 |
312 |
鈥 |
115 |
鈥 |
147 |
鈥 |
37 |
鈥 |
611 |
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Beauty |
鈥 |
鈥 |
297 |
鈥 |
168 |
鈥 |
17 |
鈥 |
鈥 |
鈥 |
482 |
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Accessories |
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鈥 |
219 |
鈥 |
67 |
鈥 |
94 |
鈥 |
鈥 |
鈥 |
380 |
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Electronics |
鈥 |
鈥 |
197 |
鈥 |
25 |
鈥 |
3 |
鈥 |
鈥 |
鈥 |
225 |
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Jewelry |
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鈥 |
93 |
鈥 |
59 |
鈥 |
12 |
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鈥 |
鈥 |
164 |
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Other revenue |
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鈥 |
43 |
鈥 |
3 |
鈥 |
7 |
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鈥 |
鈥 |
53 |
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Total Revenue |
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$ |
1,980 |
鈥 |
723 |
鈥 |
395 |
鈥 |
285 |
鈥 |
3,383 |
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Nine months ended |
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鈥 |
鈥 |
September听30, 2020 |
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QxH |
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QVC Int'l |
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Zulily |
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Corp and other |
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Total |
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in millions |
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Home |
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$ |
2,303 |
鈥 |
829 |
鈥 |
326 |
鈥 |
631 |
鈥 |
4,089 |
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Apparel |
鈥 |
鈥 |
913 |
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316 |
鈥 |
411 |
鈥 |
108 |
鈥 |
1,748 |
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Beauty |
鈥 |
鈥 |
910 |
鈥 |
499 |
鈥 |
50 |
鈥 |
鈥 |
鈥 |
1,459 |
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Accessories |
鈥 |
鈥 |
676 |
鈥 |
188 |
鈥 |
281 |
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鈥 |
鈥 |
1,145 |
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Electronics |
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鈥 |
588 |
鈥 |
78 |
鈥 |
10 |
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鈥 |
鈥 |
676 |
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Jewelry |
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鈥 |
273 |
鈥 |
155 |
鈥 |
34 |
鈥 |
鈥 |
鈥 |
462 |
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Other revenue |
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鈥 |
119 |
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6 |
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21 |
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鈥 |
鈥 |
146 |
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Total Revenue |
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$ |
5,782 |
鈥 |
2,071 |
鈥 |
1,133 |
鈥 |
739 |
鈥 |
9,725 |
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鈥
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鈥 |
Three months ended |
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鈥 |
September听30, 2019 |
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鈥 |
鈥 |
QxH |
鈥 |
QVC Int'l |
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Zulily |
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Corp and other |
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Total |
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in millions |
Home |
鈥 |
$ |
670 |
鈥 |
236 |
鈥 |
95 |
鈥 |
187 |
鈥 |
1,188 |
Apparel |
鈥 |
鈥 |
334 |
鈥 |
107 |
鈥 |
141 |
鈥 |
39 |
鈥 |
621 |
Beauty |
鈥 |
鈥 |
303 |
鈥 |
161 |
鈥 |
12 |
鈥 |
鈥 |
鈥 |
476 |
Accessories |
鈥 |
鈥 |
199 |
鈥 |
63 |
鈥 |
90 |
鈥 |
鈥 |
鈥 |
352 |
Electronics |
鈥 |
鈥 |
209 |
鈥 |
21 |
鈥 |
3 |
鈥 |
鈥 |
鈥 |
233 |
Jewelry |
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鈥 |
98 |
鈥 |
59 |
鈥 |
12 |
鈥 |
鈥 |
鈥 |
169 |
Other revenue |
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鈥 |
41 |
鈥 |
3 |
鈥 |
6 |
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鈥 |
鈥 |
50 |
Total Revenue |
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$ |
1,854 |
鈥 |
650 |
鈥 |
359 |
鈥 |
226 |
鈥 |
3,089 |
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鈥 |
Nine months ended |
鈥 |
鈥 |
鈥 |
September听30, 2019 |
鈥 |
鈥 |
鈥 |
鈥 |
QxH |
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QVC Int'l |
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Zulily |
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Corp and other |
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Total |
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in millions |
鈥 |
Home |
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$ |
2,009 |
鈥 |
714 |
鈥 |
298 |
鈥 |
530 |
鈥 |
3,551 |
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Apparel |
鈥 |
鈥 |
1,005 |
鈥 |
327 |
鈥 |
422 |
鈥 |
117 |
鈥 |
1,871 |
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Beauty |
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鈥 |
915 |
鈥 |
462 |
鈥 |
37 |
鈥 |
鈥 |
鈥 |
1,414 |
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Accessories |
鈥 |
鈥 |
667 |
鈥 |
190 |
鈥 |
295 |
鈥 |
鈥 |
鈥 |
1,152 |
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Electronics |
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鈥 |
564 |
鈥 |
68 |
鈥 |
10 |
鈥 |
鈥 |
鈥 |
642 |
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Jewelry |
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鈥 |
303 |
鈥 |
161 |
鈥 |
37 |
鈥 |
鈥 |
鈥 |
501 |
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Other revenue |
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122 |
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12 |
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20 |
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154 |
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Total Revenue |
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$ |
5,585 |
鈥 |
1,934 |
鈥 |
1,119 |
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647 |
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9,285 |
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For segment reporting purposes, jvid视频 defines Adjusted OIBDA as revenue less cost of sales, operating expenses, and selling, general and administrative expenses excluding all stock-based compensation and transaction related costs. jvid视频 believes this measure is an important indicator of the operational strength and performance of its businesses by identifying those items that are not directly a reflection of each business鈥 performance or indicative of ongoing business trends. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. This measure of performance excludes depreciation and amortization, stock-based compensation, certain acquisition accounting adjustments, separately reported litigation settlements, transaction related costs (including restructuring, integration, and advisory fees), and impairment charges that are included in the measurement of operating income pursuant to GAAP. Accordingly, Adjusted OIBDA should be considered in addition to, but not as a substitute for, operating income, net income, cash flows provided by operating activities and other measures of financial performance prepared in accordance with GAAP. jvid视频 generally accounts for intersegment sales and transfers as if the sales or transfers were to third parties, that is, at current prices.
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Adjusted OIBDA is summarized as follows:
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Three months ended September听30, |
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Nine months ended September听30, |
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2020 |
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2019 |
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2020 |
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2019 |
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amounts听in听millions |
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QxH |
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$ |
380 |
听 |
346 |
鈥 |
鈥 |
1,061 |
听 |
1,093 |
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QVC International |
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鈥 |
132 |
鈥 |
106 |
鈥 |
鈥 |
348 |
鈥 |
313 |
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Zulily |
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听 |
27 |
听 |
8 |
鈥 |
鈥 |
74 |
听 |
32 |
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Corporate and other |
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听 |
27 |
听 |
(4) |
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鈥 |
32 |
听 |
(9) |
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Consolidated jvid视频 |
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$ |
566 |
听 |
456 |
鈥 |
鈥 |
1,515 |
听 |
1,429 |
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Other Information
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September听30, 2020 |
听 |
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Total assets |
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Investments in听affiliates |
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Capital expenditures |
听 |
|
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amounts听in听millions |
听 |
QxH |
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$ |
11,928 |
听 |
38 |
鈥 |
121 |
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QVC International |
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鈥 |
2,294 |
鈥 |
鈥 |
鈥 |
19 |
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Zulily |
鈥 |
鈥 |
1,085 |
鈥 |
鈥 |
鈥 |
17 |
鈥 |
Corporate and other |
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听 |
1,485 |
听 |
14 |
鈥 |
8 |
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Consolidated jvid视频 |
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$ |
16,792 |
听 |
52 |
鈥 |
165 |
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The following table provides a reconciliation of Adjusted OIBDA to Operating income (loss) and Earnings (loss) before income taxes:
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鈥 |
Three months ended |
鈥 |
Nine months ended |
听 |
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鈥 |
September听30, |
鈥 |
September听30, |
听 |
鈥 |
听听听听 |
2020 |
听听听听 |
2019 |
听听听听 |
2020 |
听听听听 |
2019 |
听 |
|
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amounts听in听millions |
听 |
Adjusted OIBDA |
鈥 |
$ |
566 |
听 |
456 |
听 |
1,515 |
听 |
1,429 |
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Stock-based compensation |
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听 |
(19) |
听 |
(17) |
听 |
(46) |
听 |
(54) |
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Depreciation and amortization |
鈥 |
听 |
(141) |
听 |
(146) |
听 |
(427) |
听 |
(457) |
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Impairment of intangible assets |
鈥 |
鈥 |
鈥 |
鈥 |
(1,020) |
鈥 |
鈥 |
鈥 |
(1,020) |
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Transaction related costs |
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鈥 |
鈥 |
鈥 |
鈥 |
鈥 |
鈥 |
鈥 |
(1) |
鈥 |
Operating income (loss) |
鈥 |
$ |
406 |
鈥 |
(727) |
鈥 |
1,042 |
鈥 |
(103) |
鈥 |
Interest expense |
鈥 |
听 |
(98) |
听 |
(93) |
听 |
(290) |
听 |
(282) |
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Share of earnings (loss) of affiliates, net |
鈥 |
听 |
(32) |
听 |
(36) |
听 |
(96) |
听 |
(104) |
鈥 |
Realized and unrealized gains (losses) on financial instruments, net |
鈥 |
听 |
(12) |
听 |
(45) |
听 |
(127) |
听 |
(239) |
鈥 |
Gains (losses) on transactions, net |
鈥 |
鈥 |
223 |
鈥 |
鈥 |
鈥 |
224 |
鈥 |
(1) |
鈥 |
Other, net |
鈥 |
听 |
(65) |
听 |
(4) |
听 |
(65) |
听 |
(18) |
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Earnings (loss) before income taxes |
鈥 |
$ |
422 |
听 |
(905) |
听 |
688 |
听 |
(747) |
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