SEGMENT INFORMATION

3 Months Ended

Mar. 31, 2019

The overall concept that the Company employs in determining its operating segments is to present the financial information in a manner consistent with: how the chief operating decision maker views the businesses; how the businesses are organized as to segment management; and the focus of the businesses with regards to the types of services or products offered or the target market.

The following table presents revenue by reportable segment:



	Three Months Ended March 31,
	2019		2018
	(In thousands)
Revenue:
North America	$	281,994	$	236,026
Europe	21,449		19,285
Total	$	303,443	$	255,311

The following table presents the revenue of the Company's segments disaggregated by type of service:



	Three Months Ended March 31,
	2019		2018
	(In thousands)
North America
Marketplace:
Consumer connection revenue^(a)	$	201,582	$	149,060
Membership subscription revenue	16,517		15,627
Other revenue	1,826		921
Marketplace revenue	219,925		165,608
Advertising & Other revenue^(b)	62,069		70,418
Total North America revenue	281,994		236,026
Europe
Consumer connection revenue	17,123		14,367
Membership subscription revenue	3,742		4,671
Advertising and other revenue	584		247
Total Europe revenue	21,449		19,285
Total revenue	$	303,443	$	255,311

________________________


^(a)	Includes fees paid by HomeAdvisor service professionals for consumer matches and revenue from completed jobs sourced through the Handy platform.


^(b)	Includes Angie's List revenue from service professionals under contract for advertising and Angie's List membership subscription fees from consumers, as well as revenue from mHelpDesk, HomeStars, Fixd Repair and Felix. Felix was sold on December 31, 2018 and its revenue for the three months ended March 31, 2018 was $8.5 million.

Revenue by geography is based on where the customer is located. Geographic information about revenue and long-lived assets is presented below.



	Three Months Ended March 31,
	2019		2018
	(In thousands)
Revenue
United States	$	278,478	$	233,475
All other countries	24,965		21,836
Total	$	303,443	$	255,311



	March 31, 2019		December 31, 2018
	(In thousands)
Long-lived assets (excluding goodwill and intangible assets)
United States	$	73,949	$	65,510
All other countries	5,669		5,349
Total	$	79,618	$	70,859

The following tables present operating income (loss) and Adjusted EBTIDA by reportable segment:



	Three Months Ended March 31,
	2019			2018
	(In thousands)
Operating Income (Loss):
North America	$	742		$	(5,365	)
Europe	(4,383		)	(5,391		)
Total	$	(3,641	)	$	(10,756	)



	Three Months Ended March 31,
	2019			2018
	(In thousands)
Adjusted EBITDA^(c):
North America	$	39,689		$	39,605
Europe	$	(2,510	)	$	(2,965	)

________________________

^(c)

The Company’s primary financial measure is Adjusted EBITDA, which is defined as operating income excluding: (1) stock-based compensation expense; (2) depreciation; and (3) acquisition-related items consisting of amortization of intangible assets and impairments of goodwill and intangible assets, if applicable. The Company believes this measure is useful for analysts and investors as this measure allows a more meaningful comparison between our performance and that of our competitors. Moreover, our management uses this measure internally to evaluate the performance of our businesses, and this measure is one of the primary metrics on which our internal budgets are based and by which management is compensated. The above items are excluded from our Adjusted EBITDA measure because these items are non-cash in nature. Adjusted EBITDA has certain limitations because it excludes the impact of these expenses.

The following tables reconcile operating income (loss) for the Company’s reportable segments and net earnings (loss) attributable to ANGI Homeservices Inc. shareholders to Adjusted EBITDA:



	Three Months Ended March 31, 2019
	Operating income (loss)			Stock-based compensation expense		Depreciation		Amortization of intangibles		Adjusted EBITDA
	(In thousands)
North America	$	742		$	19,072	$	6,207	$	13,668	$	39,689
Europe	(4,383		)	$	210	$	792	$	871	$	(2,510	)
Operating loss	(3,641		)
Interest expense—third party	(2,994		)
Interest expense—related party	(16		)
Other income, net	2,287
Loss before income taxes	(4,364		)
Income tax benefit	14,215
Net earnings	9,851
Net loss attributable to noncontrolling interests	118
Net earnings attributable to ANGI Homeservices Inc. shareholders	$	9,969



	Three Months Ended March 31, 2018
	Operating loss			Stock-based compensation expense		Depreciation		Amortization of intangibles		Adjusted EBITDA
	(In thousands)
North America	$	(5,365	)	$	24,575	$	5,574	$	14,821	$	39,605
Europe	(5,391		)	$	331	$	610	$	1,485	$	(2,965	)
Operating loss	(10,756		)
Interest expense—third party	(2,654		)
Interest expense—related party	(45		)
Other income, net	356
Loss before income taxes	(13,099		)
Income tax benefit	3,985
Net loss	(9,114		)
Net loss attributable to noncontrolling interests	229
Net loss attributable to ANGI Homeservices Inc. shareholders	$	(8,885	)