Expedia 2010 Annual Report Download - page 105

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and evaluate operating performance. Our primary operating metric for evaluating segment performance is
Operating Income Before Amortization (“OIBA”). OIBA for our Leisure and Egencia segments includes
allocations of certain expenses, primarily cost of revenue and facilities, and our Leisure segment includes the
total costs of our Partner Services Group as well as the realized foreign currency gains or losses related to the
forward contracts hedging a component of our net merchant hotel revenue. We base the allocations primarily on
transaction volumes and other usage metrics; this methodology is periodically evaluated and may change. We do
not allocate certain shared expenses such as accounting, human resources, information technology and legal to
our reportable segments. We include these expenses in Corporate and Eliminations.
Our Leisure segment provides a full range of travel and advertising services to our worldwide customers
through a variety of brands including: Expedia.com and Hotels.com in the United States and localized Expedia
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.
Our segment disclosure includes 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.
F-34