SEGMENT INFORMATION

Operating segments are defined as components of an enterprise that engage in business activities for which separate financial information is available and evaluated by the Company’s Chief Operating Decision Maker (the “CODM”), which for Harmonic is its Chief Executive Officer, in deciding how to allocate resources and assess performance. Based on our internal reporting structure, the Company consists of two operating segments: Video and Cable Access (renamed from Cable Edge). The operating segments were determined based on the nature of the products offered. The Video segment sells video processing and production and playout solutions and services worldwide to broadcast and media companies, streaming new media companies, cable operators, and satellite and telecommunications (telco) Pay-TV service providers. The Cable Access segment sells cable access solutions and related services to cable operators globally.

The Company does not allocate amortization of intangibles, stock-based compensation, restructuring and related charges, TVN acquisition- and integration-related costs, and certain other non-recurring charges to the operating income (loss) for each segment because management does not include this information in the measurement of the performance of the operating segments. A measure of assets by segment is not applicable as segment assets are not included in the discrete financial information provided to the CODM.

The following table provides summary financial information by reportable segment (in thousands):



	Three months ended
	March 30, 2018 ⁽¹⁾			March 31, 2017
Video
Revenue	$	71,748		$	74,342
Gross profit	41,226			40,773
Operating income (loss)	1,995			(5,836		)
Cable Access
Revenue	$	18,490		$	8,601
Gross profit	8,640			2,210
Operating loss	(1,513		)	(6,080		)
Total
Revenue	$	90,238		$	82,943
Gross profit	49,866			42,983
Operating income (loss)	482			(11,916		)

(1) The Company has historically employed an aggregate allocation methodology based on total revenues to attribute professional services revenue and sales expenses between its Video and Cable Access segments. Beginning in the fourth quarter of 2017, the Company has prospectively changed to a more precise attribution methodology as the activities of selling and supporting the CableOS solution have become increasingly distinct from those of Video solutions. The impact of making this change in the first quarter of 2017 compared to the Company’s historical approach was an increase in operating loss of $1.1 million from the Video segment and a corresponding decrease to the operating loss of the Cable Access segment. The Company believes that the updated allocation methodology will provide greater clarity regarding the operating metrics of the Video and Cable Access business segments.

A reconciliation of the Company’s consolidated segment operating income (loss) to consolidated loss before income taxes is as follows (in thousands):



	Three months ended
	March 30, 2018			March 31, 2017
Total segment operating income (loss)	$	482		$	(11,916	)
Amortization of warrants	(111		)	—
Unallocated corporate expenses	(1,842		)	(3,922		)
Stock-based compensation	(5,757		)	(3,251		)
Amortization of intangibles	(2,099		)	(2,069		)
Loss from operations	(9,327		)	(21,158		)
Non-operating income (expense)	(3,289		)	(3,101		)
Loss before income taxes	$	(12,616	)	$	(24,259	)