Note 10 – Segment Information

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 is 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.

The following tables set forth business segment information:

	MOSFETs		Diodes		Optoelectronic Components		Resistors & Inductors		Capacitors		Total
Fiscal quarter ended March 30, 2019:
Net revenues	$	137,341	$	167,840	$	60,562	$	260,471	$	118,945	$	745,159

Gross profit	$	36,059	$	43,492	$	16,017	$	85,869	$	29,722	$	211,159

Segment operating income	$	26,678	$	38,128	$	11,710	$	76,987	$	24,566	$	178,069

Fiscal quarter ended March 31, 2018:
Net revenues	$	127,506	$	167,017	$	71,958	$	244,046	$	106,268	$	716,795

Gross profit	$	32,022	$	43,200	$	27,233	$	78,530	$	24,315	$	205,300

Segment operating income	$	22,558	$	37,931	$	22,794	$	70,002	$	18,893	$	172,178

	Fiscal quarters ended
	March 30, 2019			March 31, 2018
Reconciliation:
Segment Operating Income	$	178,069		$	172,178
Unallocated Selling, General, and Administrative Expenses		(70,334	)		(68,116	)
Consolidated Operating Income		107,735		$	104,062
Unallocated Other Income (Expense)		(7,787	)		(12,043	)
Consolidated Income Before Taxes	$	99,948			92,019

The Company has a broad line of products that it sells to OEMs, EMS companies, and independent distributors. The distribution of sales by customer type is shown below:

	Fiscal quarters ended
	March 30, 2019		March 31, 2018
Distributors	$	411,560	$	404,060
OEMs		282,636		264,050
EMS companies		50,963		48,685
Total Revenue	$	745,159	$	716,795

Net revenues were attributable to customers in the following regions:

	Fiscal quarters ended
	March 30, 2019		March 31, 2018
Asia	$	259,726	$	285,478
Europe		278,899		267,382
Americas		206,534		163,935
Total Revenue	$	745,159	$	716,795

The Company generates substantially all of its revenue from product sales to end customers in the industrial, automotive, telecommunications, computing, consumer products, power supplies, military and aerospace, and medical end markets. Sales by end market are presented below:

	Fiscal quarters ended
	March 30, 2019		March 31, 2018
Industrial	$	281,590	$	280,212
Automotive		214,786		208,394
Telecommunications		53,280		45,924
Computing		47,508		47,431
Consumer Products		34,049		37,259
Power Supplies		30,127		34,243
Military and Aerospace		47,561		35,214
Medical		36,258		28,118
Total revenue	$	745,159	$	716,795