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Expedia, Inc.
Notes to Consolidated Financial Statements — (Continued)
and hotels.com websites throughout the world, Expedia Affiliate Network, Hotwire.com, Venere, eLong and
Classic Vacations. Our TripAdvisor Media Network segment provides advertising services to travel suppliers on
its websites, which aggregate traveler opinions and unbiased travel articles about cities, hotels, restaurants and
activities in a variety of destinations through tripadvisor.com and its localized international versions, as well as
through its various travel media content properties within the TripAdvisor Media Network. Our Egencia segment
provides managed travel services to corporate customers in North America, Europe, and the Asia Pacific region.
Concurrent with the change to three reportable segments, we have expanded our segment disclosure to
include intersegment revenues, which primarily consist of advertising and media services provided by our
TripAdvisor Media Network segment to our Leisure segment. These intersegment transactions are recorded by
each segment at estimated fair value as if the transactions were with third parties and, therefore, impact segment
performance. However, the revenue and corresponding expense are eliminated in consolidation. The elimination
of such intersegment transactions is included within “Corporate and Eliminations” in the table below.
Corporate and Eliminations also includes unallocated corporate functions and expenses. In addition, we
record amortization of intangible assets and any related impairment, as well as stock-based compensation
expense, restructuring charges and other items excluded from segment operating performance in Corporate and
Eliminations. Such amounts are detailed in our segment reconciliation below.
The following tables present our segment information for the years ended December 31, 2009, 2008 and
2007. As a significant portion of our property and equipment is not allocated to our operating segments, we do
not report the assets or related depreciation expense as it would not be meaningful, nor do we regularly provide
such information to our chief operating decision makers.
Year ended December 31, 2009
Leisure
TripAdvisor
Media Network Egencia
Corporate &
Eliminations Total
(In thousands)
Third-party revenue ...................... $2,634,766 $212,375 $108,285 $ — $2,955,426
Intersegment revenue .................... — 139,714 — (139,714) —
Revenue ............................... $2,634,766 $352,089 $108,285 $(139,714) $2,955,426
Operating Income Before Amortization ...... $ 856,967 $195,933 $ 1,350 $(292,718) $ 761,532
Amortization of intangible assets ........... — — — (37,681) (37,681)
Stock-based compensation ................ — — — (61,661) (61,661)
Restructuring charges .................... — — — (34,168) (34,168)
Occupancy tax assessments and legal
reserves ............................. — — — (67,658) (67,658)
Realized loss on revenue hedges ............ — — — 11,050 11,050
Operating income (loss) .................. $ 856,967 $195,933 $ 1,350 $(482,836) 571,414
Other expense, net ....................... (113,391)
Income before income taxes ............... 458,023
Provision for income taxes ................ (154,400)
Net income ............................ 303,623
Net income attributable to noncontrolling
interests ............................. (4,097)
Net income attributable to Expedia, Inc. . . . $ 299,526
F-36