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59
For the Year Ended December 31, 2014
Foreign currency
translation
adjustments
Unrealized gain
on available-for-
sale securities
Unrealized gain
(loss)
on forward
contracts Total
Balance at December 31, 2013 .................................................. $ 67 $ 1 $ — $ 68
Other comprehensive income (loss) before reclassifications . (371) — 8 (363)
Amounts reclassified from accumulated other comprehensive
income (loss) ...................................................................... ——(8) (8)
Balance at December 31, 2014 .................................................. $ (304) $ 1 $ — $ (303)
Income taxes were not provided for foreign currency translation items as these are considered indefinite investments in non-U.S.
subsidiaries.
13. Operating Segments and Geographic Region
Our operating segments are consistent with our internal organizational structure, the manner in which our operations are reviewed and
managed by our Chief Executive Officer, who is our Chief Operating Decision Maker (“CODM”), the manner in which we assess
operating performance and allocate resources, and the availability of separate financial information. Currently, we have two reportable
operating segments (see Note 1 of the Notes to Consolidated Financial Statements). Previously, we reported “Distribution” as a
reportable segment. In the current period, this was no longer deemed a reportable segment and is included in “Other,” along with our
recently announced Media Networks and Studios businesses. We do not aggregate operating segments.
The CODM reviews segment performance exclusive of the impact of the change in deferred revenues and related cost of sales with
respect to certain of our online-enabled games, stock-based compensation expense, amortization of intangible assets as a result of
purchase price accounting, and fees and other expenses (including legal fees, costs, expenses and accruals) related to acquisitions and
the Purchase Transaction. The CODM does not review any information regarding total assets on an operating segment basis, and
accordingly, no disclosure is made with respect thereto. Information on the operating segments and reconciliations of total net
revenues and total segment operating income to consolidated net revenues from external customers and consolidated income before
income tax expense for the years ended December 31, 2015, 2014 and 2013 are presented below (amounts in millions):
Years Ended December 31,
2015 2014 2013 2015 2014 2013
Net revenues
Income from
operations before income
tax expense
Activision ....................................................................................................... $ 2,700 $ 2,686 $ 2,895 $ 868 $ 762 $ 971
Blizzard ........................................................................................................... 1,565 1,720 1,124 561 756 376
Other(1) .......................................................................................................... 356 407 323 37 9 8
Segments total ........................................................................................... 4,621 4,813 4,342 1,466 1,527 1,355
Reconciliation to consolidated net revenues / consolidated income before income
tax expense:
Net effect from deferral of net revenues and related cost of sales ................ 43 (405) 241 (39) (215) 229
Stock-based compensation expense ............................................................... — — — (92) (104) (110)
Amortization of intangible assets ................................................................... — — — (11) (12) (23)
Fees and other expenses related to acquisitions and the Purchase Transaction(2) —— — (5) (13) (79)
Consolidated net revenues / operating income ................................................... $ 4,664 $ 4,408 $ 4,583 $ 1,319 $ 1,183 $ 1,372
Interest and other expense, net ....................................................................... 198 202 53
Consolidated income before income tax expense ............................................... $ 1,121 $ 981 $ 1,319
(1) Other includes other income and expenses from operating segments managed outside the reportable segments, including our
Media Networks, Studios, and Distribution businesses. Other also includes unallocated corporate income and expenses.
(2) Reflects fees and other expenses related to the Purchase Transaction and the King Acquisition, inclusive of related debt
financings.
Geographic information presented below for the years ended December 31, 2015, 2014, and 2013 is based on the location of the
selling entity. Net revenues from external customers by geographic region were as follows (amounts in millions):
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