3. SEGMENT INFORMATION

The Company operates in three reportable segments, based upon the type of advertising medium: television broadcasting, radio broadcasting and digital media. The Company’s segments results reflect information presented on the same basis that is used for internal management reporting and it is also how the chief operating decision maker evaluates the business.

Television Broadcasting

The Company owns and/or operates 54 primary television stations located primarily in California, Colorado, Connecticut, Florida, Kansas, Massachusetts, Nevada, New Mexico, Texas and Washington, D.C.

Radio Broadcasting

The Company owns and operates 49 radio stations (38 FM and 11 AM) located primarily in Arizona, California, Colorado, Florida, Nevada, New Mexico and Texas.

The Company owns and operates a national sales representation division, Entravision Solutions, through which the Company sells advertisements and syndicates radio programming to more than 300 stations across the United States.

Digital Media

The Company owns and operates digital media operations, offering mobile, digital and other interactive media platforms and services on Internet-connected devices, including local websites and social media, that provide users with news information and other content.

On April 4, 2017, the Company completed the acquisition of 100% of the stock of several entities collectively doing business as Headway (“Headway”), a provider of mobile, programmatic, data and performance digital marketing solutions primarily in the United States, Mexico and other markets in Latin America. See Note 5 to the Notes to the Consolidated Financial Statements.

Separate financial data for each of the Company’s operating segments are provided below. Segment operating profit (loss) is defined as operating profit (loss) before corporate expenses and foreign currency (gain) loss. The Company generated 15% and 8% of its revenue outside the United States during the three- and six-month periods ended June 30, 2017 and 2016, respectively. The Company evaluates the performance of its operating segments based on the following (in thousands):

	Three-Month Period									Six-Month Period
	Ended June 30,						%			Ended June 30,						%
	2017			2016			Change			2017			2016			Change
Net revenue
Television	$	37,764		$	39,215			(4	)%	$	75,474		$	75,780			(0	)%
Radio		17,163			19,552			(12	)%		32,882			36,436			(10	)%
Digital		15,582			6,062			157	%		19,663			10,726			83	%
Consolidated		70,509			64,829			9	%		128,019			122,942			4	%

Cost of revenue - digital media		8,762			2,373			269	%		10,514			4,212			150	%

Direct operating expenses
Television		14,873			15,475			(4	)%		29,627			30,509			(3	)%
Radio		11,039			11,285			(2	)%		22,056			22,226			(1	)%
Digital		4,003			1,778			125	%		5,324			3,368			58	%
Consolidated		29,915			28,538			5	%		57,007			56,103			2	%

Selling, general and administrative expenses
Television		5,277			5,193			2	%		10,728			10,639			1	%
Radio		4,581			4,950			(7	)%		9,285			9,838			(6	)%
Digital		2,172			1,267			71	%		3,217			2,368			36	%
Consolidated		12,030			11,410			5	%		23,230			22,845			2	%

Depreciation and amortization
Television		2,500			2,705			(8	)%		4,963			5,572			(11	)%
Radio		662			842			(21	)%		1,388			1,632			(15	)%
Digital		1,415			338			319	%		1,772			708			150	%
Consolidated		4,577			3,885			18	%		8,123			7,912			3	%

Segment operating profit (loss)
Television		15,114			15,842			(5	)%		30,156			29,060			4	%
Radio		881			2,475			(64	)%		153			2,740			(94	)%
Digital		(770	)		306		*				(1,164	)		70		*
Consolidated		15,225			18,623			(18	)%		29,145			31,870			(9	)%

Corporate expenses		5,619			5,293			6	%		11,486			10,897			5	%
Foreign currency transaction (gain) loss		351			-		*				351			-		*
Operating income (loss)		9,255			13,330			(31	)%		17,308			20,973			(17	)%

Interest expense	$	(3,683	)	$	(3,859	)		(5	)%	$	(7,328	)	$	(7,725	)		(5	)%
Interest income		110			118			(7	)%		219			125			75	%
Income before income taxes		5,682			9,589			(41	)%		10,199			13,373			(24	)%

Capital expenditures
Television	$	4,985		$	1,138					$	5,952		$	2,558
Radio		575			1,061						843			1,832
Digital		4			147						13			196
Consolidated	$	5,564		$	2,346					$	6,808		$	4,586

	June 30,			December 31,
Total assets	2017			2016
Television		349,140			363,852
Radio		126,177			129,825
Digital		77,727			24,244
Consolidated	$	553,044		$	517,921

*	Percentage not meaningful.