Note 15 – Segment and Geographic Data

Vishay is a global manufacturer and supplier of electronic components. Vishay operates, and its chief operating decision maker makes strategic and operating decisions with regards to assessing performance and allocating resources based on, five reporting segments: MOSFETs, Diodes, Optoelectronic Components, Resistors & Inductors, and Capacitors. These segments represent groupings of product lines based on their functionality:

●		Metal oxide semiconductor field effect transistors ("MOSFETs") function as solid state switches to control power.
●		Diodes route, regulate, and block radio frequency, analog, and power signals; protect systems from surges or electrostatic discharge damage; or provide electromagnetic interference filtering.
●		Optoelectronic components emit light, detect light, or do both.
●		Resistors and inductors both impede electric current. Resistors are basic components used in all forms of electronic circuitry to adjust and regulate levels of voltage and current. Inductors use an internal magnetic field to change alternating current phase and resist alternating current.
●		Capacitors store energy and discharge it when needed.

Vishay's reporting segments generate substantially all of their revenue from product sales to the industrial, automotive, telecommunications, computing, consumer products, power supplies, military and aerospace, and medical end markets. A small portion of revenues are from royalties.

The Company evaluates business segment performance on operating income, exclusive of certain items ("segment operating income"). Only dedicated, direct selling, general, and administrative expenses of the segments are included in the calculation of segment operating income. The Company's calculation of segment operating income excludes such selling, general, and administrative costs as global operations, sales and marketing, information systems, finance and administration groups, as well as restructuring and severance costs, goodwill and long-lived asset impairment charges, and other items. Management believes that evaluating segment performance excluding such items is meaningful because it provides insight with respect to intrinsic operating results of the Company. These items represent reconciling items between segment operating income and consolidated operating income. Business segment assets are the owned or allocated assets used by each business.

The Company also regularly evaluates gross profit by segment to assist in the analysis of consolidated gross profit. The Company considers segment operating income to be the more important metric because it more fully captures the business operations of the segments.

Note 15 – Segment and Geographic Data (continued)

The following tables set forth business segment information:

	MOSFETs		Diodes		Optoelectronic Components		Resistors & Inductors		Capacitors		Corporate / Other		Total

Year ended December 31, 2017:
Product sales	$	468,294	$	620,888	$	286,349	$	843,965	$	383,932	$	-	$	2,603,428
Royalty revenues		-		-		-		94		-		-	$	94
Total revenue	$	468,294	$	620,888	$	286,349	$	844,059	$	383,932	$	-	$	2,603,522

Gross Profit	$	109,436	$	162,645	$	97,436	$	251,725	$	78,370	$	-	$	699,612

Segment Operating Income	$	74,002	$	142,833	$	79,691	$	222,634	$	58,474	$	-	$	577,634

Depreciation expense	$	34,731	$	37,396	$	16,871	$	34,083	$	17,736	$	8,066	$	148,883
Capital expenditures		33,475		38,681		16,115		67,007		11,135		4,019	$	170,432

Total Assets as of December 31, 2017:	$	412,598	$	792,610	$	332,228	$	992,439	$	567,413	$	361,901	$	3,459,189

Year ended December 31, 2016:
Product sales	$	406,336	$	553,920	$	272,126	$	753,578	$	337,212	$	-	$	2,323,172
Royalty revenues		-		-		-		259		-		-	$	259
Total revenue	$	406,336	$	553,920	$	272,126	$	753,837	$	337,212	$	-	$	2,323,431

Gross Profit	$	58,155	$	134,937	$	87,022	$	222,786	$	66,883	$	-	$	569,783

Segment Operating Income	$	22,254	$	113,995	$	67,548	$	191,283	$	46,338	$	-	$	441,418

Depreciation expense	$	34,531	$	35,335	$	15,549	$	32,240	$	17,817	$	9,049	$	144,521
Capital expenditures		22,430		29,860		18,276		47,006		14,410		2,653	$	134,635

Total Assets as of December 31, 2016:	$	389,482	$	714,898	$	312,423	$	905,795	$	495,225	$	259,978	$	3,077,801

Year ended December 31, 2015:
Product sales	$	426,672	$	533,931	$	279,553	$	704,109	$	352,900	$	-	$	2,297,165
Royalty revenues		11		-		-		3,312		-		-	$	3,323
Total revenue	$	426,683	$	533,931	$	279,553	$	707,421	$	352,900	$	-	$	2,300,488

Gross Profit	$	58,626	$	119,762	$	88,625	$	208,384	$	66,823	$	-	$	542,220

Segment Operating Income	$	21,366	$	95,887	$	68,410	$	173,805	$	44,863	$	-	$	404,331

Depreciation expense	$	47,172	$	35,526	$	14,118	$	30,576	$	18,168	$	8,780	$	154,340
Capital expenditures		29,289		38,971		21,853		38,169		14,763		4,097	$	147,142

Total Assets as of December 31, 2015:	$	477,984	$	718,548	$	325,600	$	839,249	$	543,507	$	248,098	$	3,152,986

________________

Note 15 – Segment and Geographic Data (continued)

	Years ended December 31,
	2017			2016			2015

Reconciliation:
Segment Operating Income	$	577,634		$	441,418		$	404,331
Restructuring and Severance Costs		(11,273	)		(19,199	)		(19,215	)
Impairment of Intangible Assets		-			(1,559	)		(57,600	)
Impairment of Goodwill		-			-			(5,380	)
U.S. Pension Settlement Charges		-			(79,321	)		-
Unallocated Selling, General, and Administrative Expenses		(254,773	)		(239,622	)		(224,337	)
Consolidated Operating Income (Loss)	$	311,588		$	101,717		$	97,799
Unallocated Other Income (Expense)		(32,224	)		(7,501	)		(23,059	)
Consolidated Income Before Taxes	$	279,364		$	94,216		$	74,740

See Note 4 for restructuring and severance costs segment information.

The following table summarizes net revenues based on revenues generated by subsidiaries located within the identified geographic area:

	Years ended December 31,
	2017		2016		2015

United States	$	590,638	$	542,506	$	560,973
Germany		839,984		746,657		719,246
Other Europe		99,327		83,744		88,553
Israel		11,292		10,007		12,597
Asia		1,062,281		940,517		919,119
	$	2,603,522	$	2,323,431	$	2,300,488

The following table summarizes property and equipment based on physical location:

	December 31,
	2017		2016

United States	$	99,993	$	94,589
Germany		154,874		120,223
Other Europe		130,523		112,953
Israel		102,890		104,824
People's Republic of China		192,521		183,158
Republic of China (Taiwan)		122,080		124,724
Other Asia		99,493		105,400
Other		3,384		3,000
	$	905,758	$	848,871