BUSINESS SEGMENTS

The Company’s primary business is leasing space on multitenant communications sites to wireless service providers, radio and television broadcast companies, wireless data providers, government agencies and municipalities and tenants in a number of other industries. This business is referred to as the Company’s property operations, which as of June 30, 2017, consisted of the following:


•	U.S.: property operations in the United States;


•	Asia: property operations in India;


•	Europe, Middle East and Africa (“EMEA”): property operations in France, Germany, Ghana, Nigeria, South Africa and Uganda; and


•	Latin America: property operations in Argentina, Brazil, Chile, Colombia, Costa Rica, Mexico and Peru.

The Company has applied the aggregation criteria to operations within the EMEA and Latin America property operating segments on a basis that is consistent with management’s review of information and performance evaluations of these regions.

The Company’s services segment offers tower-related services in the United States, including site acquisition, zoning and permitting and structural analysis, which primarily support its site leasing business, including the addition of new tenants and equipment on its sites. The services segment is a strategic business unit that offers different services from, and requires different resources, skill sets and marketing strategies than, the property operating segments.

The accounting policies applied in compiling segment information below are similar to those described in note 1 to the Company’s consolidated financial statements included in the 2016 Form 10-K. Among other factors, in evaluating financial performance in each business segment, management uses segment gross margin and segment operating profit. The Company defines segment gross margin as segment revenue less segment operating expenses excluding stock-based compensation expense recorded in costs of operations; Depreciation, amortization and accretion; Selling, general, administrative and development expense; and Other operating expenses. The Company defines segment operating profit as segment gross margin less Selling, general, administrative and development expense attributable to the segment, excluding stock-based compensation expense and corporate expenses. For reporting purposes, the Latin America property segment gross margin and segment operating profit also include Interest income, TV Azteca, net. These measures of segment gross margin and segment operating profit are also before Interest income, Interest expense, Gain (loss) on retirement of long-term obligations, Other income (expense), Net income (loss) attributable to noncontrolling interests and Income tax benefit (provision). The categories of expenses indicated above, such as depreciation, have been excluded from segment operating performance as they are not considered in the review of information or the evaluation of results by management. There are no significant revenues resulting from transactions between the Company’s operating segments. All intercompany transactions are eliminated to reconcile segment results and assets to the consolidated statements of operations and consolidated balance sheets.

Summarized financial information concerning the Company’s reportable segments for the three and six months ended June 30, 2017 and 2016 is shown in the following tables. The “Other” column (i) represents amounts excluded from specific segments, such as business development operations, stock-based compensation expense and corporate expenses included in Selling, general, administrative and development expense; Other operating expenses; Interest income; Interest expense; Gain (loss) on retirement of long-term obligations; and Other income (expense), and (ii) reconciles segment operating profit to Income from continuing operations before income taxes.



	Property								Total Property		Services		Other		Total
Three Months Ended June 30, 2017	U.S.		Asia		EMEA		Latin America		Total Property		Services		Other		Total
	(in thousands)
Segment revenues	$	897,296	$	294,556	$	159,628	$	286,695	$	1,638,175	$	24,259			$	1,662,434
Segment operating expenses (1)	183,625		167,993		59,069		95,902		506,589		9,748				516,337
Interest income, TV Azteca, net	—		—		—		2,770		2,770		—				2,770
Segment gross margin	713,671		126,563		100,559		193,563		1,134,356		14,511				1,148,867
Segment selling, general, administrative and development expense (1)	36,223		16,571		17,949		19,482		90,225		3,422				93,647
Segment operating profit	$	677,448	$	109,992	$	82,610	$	174,081	$	1,044,131	$	11,089			$	1,055,220
Stock-based compensation expense													$	25,738	25,738
Other selling, general, administrative and development expense													34,609		34,609
Depreciation, amortization and accretion													396,355		396,355
Other expense (2)													186,048		186,048
Income from continuing operations before income taxes															$	412,470
Total assets	$	18,717,076	$	4,808,551	$	3,189,403	$	5,100,443	$	31,815,473	$	43,366	$	279,371	$	32,138,210

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(1)	Segment operating expenses and segment selling, general, administrative and development expenses exclude stock-based compensation expense of $0.8 million and $24.9 million, respectively.


(2)	Primarily includes interest expense.



	Property								Total Property		Services		Other		Total
Three Months Ended June 30, 2016	U.S.		Asia		EMEA		Latin America		Total Property		Services		Other		Total
	(in thousands)
Segment revenues	$	829,680	$	224,611	$	134,762	$	237,139	$	1,426,192	$	16,035			$	1,442,227
Segment operating expenses (1)	182,376		127,855		58,462		83,486		452,179		6,885				459,064
Interest income, TV Azteca, net	—		—		—		2,748		2,748		—				2,748
Segment gross margin	647,304		96,756		76,300		156,401		976,761		9,150				985,911
Segment selling, general, administrative and development expense (1)	34,721		14,770		16,685		15,031		81,207		3,346				84,553
Segment operating profit	$	612,583	$	81,986	$	59,615	$	141,370	$	895,554	$	5,804			$	901,358
Stock-based compensation expense													$	21,907	21,907
Other selling, general, administrative and development expense													32,421		32,421
Depreciation, amortization and accretion													397,765		397,765
Other expense (2)													213,291		213,291
Income from continuing operations before income taxes															$	235,974
Total assets	$	18,949,936	$	4,557,692	$	2,025,767	$	4,929,052	$	30,462,447	$	62,766	$	214,985	$	30,740,198

_______________


(1)	Segment operating expenses and segment selling, general, administrative and development expenses exclude stock-based compensation expense of $0.6 million and $21.3 million, respectively.


(2)	Primarily includes interest expense.



	Property								Total Property		Services		Other		Total
Six Months Ended June 30, 2017	U.S.		Asia		EMEA		Latin America		Total Property		Services		Other		Total
	(in thousands)
Segment revenues	$	1,789,180	$	570,087	$	310,035	$	562,937	$	3,232,239	$	46,433			$	3,278,672
Segment operating expenses (1)	364,960		317,394		120,564		189,183		992,101		16,066				1,008,167
Interest income, TV Azteca, net	—		—		—		5,470		5,470		—				5,470
Segment gross margin	1,424,220		252,693		189,471		379,224		2,245,608		30,367				2,275,975
Segment selling, general, administrative and development expense (1)	70,871		37,066		34,402		38,043		180,382		6,593				186,975
Segment operating profit	$	1,353,349	$	215,627	$	155,069	$	341,181	$	2,065,226	$	23,774			$	2,089,000
Stock-based compensation expense													$	61,960	61,960
Other selling, general, administrative and development expense													70,733		70,733
Depreciation, amortization and accretion													817,495		817,495
Other expense (2)													392,169		392,169
Income from continuing operations before income taxes															$	746,643

_______________


(1)	Segment operating expenses and segment selling, general, administrative and development expenses exclude stock-based compensation expense of $1.7 million and $60.2 million, respectively.


(2)	Primarily includes interest expense.



	Property								Total Property		Services		Other		Total
Six Months Ended June 30, 2016	U.S.		Asia		EMEA		Latin America		Total Property		Services		Other		Total
	(in thousands)
Segment revenues	$	1,681,424	$	287,827	$	264,402	$	460,190	$	2,693,843	$	37,431			$	2,731,274
Segment operating expenses (1)	360,098		160,935		114,121		158,808		793,962		15,889				809,851
Interest income, TV Azteca, net	—		—		—		5,464		5,464		—				5,464
Segment gross margin	1,321,326		126,892		150,281		306,846		1,905,345		21,542				1,926,887
Segment selling, general, administrative and development expense (1)	72,007		21,346		32,837		29,615		155,805		6,262				162,067
Segment operating profit	$	1,249,319	$	105,546	$	117,444	$	277,231	$	1,749,540	$	15,280			$	1,764,820
Stock-based compensation expense													$	49,986	49,986
Other selling, general, administrative and development expense													62,801		62,801
Depreciation, amortization and accretion													739,399		739,399
Other expense (2)													366,229		366,229
Income from continuing operations before income taxes															$	546,405

_______________


(1)	Segment operating expenses and segment selling, general, administrative and development expenses exclude stock-based compensation expense of $1.3 million and $48.7 million, respectively.


(2)	Primarily includes interest expense.