6. SEGMENT INFORMATION

As a result of the Company's management changes in the first quarter of 2017, the Company concluded that the Chief Operating Decision Maker, as defined in ASC 280, is now comprised of the CEO, President and CFO. This change required the Company to reevaluate its determination of operating segments. The Company's operating segments are based on geographic regions that generate revenue and hold its long-lived assets. The Company sells and distributes its products through a global network of customers and sales leaders in approximately 50 markets. The Company has divided these markets into seven operating segments, which are the Company's reportable segments: Mainland China, Hong Kong/Taiwan, South Korea, Japan, South Asia/Pacific, Americas and EMEA. The seven reportable segments generate revenue from the sale of personal care products and nutritional supplements under the Nu Skin and Pharmanex brands, have similar business characteristics and align with how the CODM function began assessing performance and allocating resources in the first quarter of 2017.

Profitability by segment as reported under US GAAP is driven primarily by the Company's international taxation policies. Segment contribution, which is the Company's segment profitability metric presented in the table below, excludes certain intercompany charges, specifically royalties, license fees, transfer pricing, discrete charges and other miscellaneous items. These charges have been included in Corporate and other expenses. Corporate and other expenses also include costs related to the Company's executive and administrative offices, information technology, research and development, marketing and supply chain functions not recorded at the segment level.

The accounting policies of the segments are the same as those described in Note 1 – The Company. The Company evaluates the performance of its segments based on revenue and segment contribution. Each segment records direct expenses related to its employees and its operations.

Summarized financial information for the Company's reportable segments is shown in the following tables. Asset information is not reviewed or included with the Company's internal management reporting. Therefore, the Company has not disclosed asset information for each reportable segment.

Revenue by Segment

	Three Months Ended September 30,				Nine Months Ended September 30,
(U.S. dollars in thousands)	2017		2016		2017		2016

Mainland China	$	172,556	$	168,320	$	494,658	$	471,319
South Korea		89,238		136,188		258,626		315,342
Americas		79,214		71,250		221,968		204,882
South Asia/Pacific		78,994		70,867		216,727		226,742
Japan		62,513		72,489		188,465		210,429
Hong Kong/Taiwan		41,050		48,140		120,069		140,568
EMEA		40,133		36,908		112,385		107,186
Total	$	563,698	$	604,162	$	1,612,898	$	1,676,468

Segment Contribution

	Three Months Ended September 30,						Nine Months Ended September 30,
(U.S. dollars in thousands)	2017			2016			2017			2016

Mainland China	$	42,375		$	38,240		$	130,085		$	113,250
South Korea		23,713			41,739			70,503			89,991
Americas		12,822			11,637			34,564			34,286
South Asia/Pacific		18,664			16,371			47,083			53,172
Japan		12,786			15,510			36,134			43,490
Hong Kong/Taiwan		8,096			10,401			20,945			25,829
EMEA		2,896			3,258			8,304			6,438
Total segment contribution		121,352			137,156			347,618			366,456
Corporate and other		(56,990	)		(54,782	)		(172,255	)		(196,135	)
Operating income		64,362			82,374			175,363			170,321
Other income (expense)		(1,172	)		(5,695	)		(8,470	)		(19,618	)
Income before provision for income taxes	$	63,190		$	76,679		$	166,893		$	150,703

Depreciation and Amortization

	Three Months Ended September 30,				Nine Months Ended September 30,
(U.S. dollars in thousands)	2017		2016		2017		2016

Mainland China	$	3,550	$	4,218	$	11,202	$	12,362
South Korea		1,586		1,773		4,872		5,137
Americas		341		672		1,319		2,010
South Asia/Pacific		585		636		1,733		1,796
Japan		898		1,002		2,677		2,848
Hong Kong/Taiwan		353		558		999		1,669
EMEA		226		356		820		1,027
Corporate and other		9,906		9,503		28,903		26,553
Total	$	17,445	$	18,718	$	52,525	$	53,402

Capital Expenditures

	Three Months Ended September 30,				Nine Months Ended September 30,
(U.S. dollars in thousands)	2017		2016		2017		2016

Mainland China	$	688	$	1,711	$	2,351	$	8,709
South Korea		—		141		464		520
Americas		133		96		697		585
South Asia/Pacific		284		235		814		1,978
Japan		109		49		206		916
Hong Kong/Taiwan		2		179		1,119		444
EMEA		571		131		882		798
Corporate and other		9,427		7,763		32,432		21,069
Total	$	11,214	$	10,305	$	38,965	$	35,019

Revenue by Major Market

A major market is defined as one with total revenue greater than 10% of consolidated total revenue. Based on this criteria, the Company has identified three major markets: Mainland China, South Korea and Japan. There are approximately 50 other markets, each of which individually is less than 10%. No single customer accounted for 10% or more of net sales for the periods presented. Sales are recorded in the jurisdiction in which the transactions occurred (U.S. dollars in thousands):

Revenue by Product Line

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016

Nu Skin	$	338,305	$	343,131	$	985,465	$	998,386
Pharmanex		224,031		259,896		623,046		674,624
Other		1,362		1,135		4,387		3,458
Totals	$	563,698	$	604,162	$	1,612,898	$	1,676,468

Long-Lived Assets by Major Market

A major market is defined as a market with long-lived assets greater than 10% of consolidated long-lived assets and also includes the Company's country of domicile (the U.S.). Long-lived assets in Mainland China consist primarily of property, plant and equipment related to manufacturing, distribution facilities and the Mainland China headquarters. Long-lived assets in the U.S. consist primarily of property, plant and equipment, including the Company's corporate offices and distribution facilities. Long-lived assets by major markets are set forth below for the periods ended September 30, 2017 and December 31, 2016 (U.S. dollars in thousands):

	September 30, 2017		December 31, 2016

United States	$	294,567	$	283,868
Mainland China		93,108		97,867
South Korea		40,446		41,545
Japan		9,447		11,517
All others		11,987		9,935
Total	$	449,555	$	444,732