Segments and Geographic Information

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Segments and Geographic Information

Segments and Geographic Information

In accordance with FASB ASC Topic 280, Segment Reporting, we disaggregate our operations into two reportable segments: Sirius XM and Pandora. The financial results of these segments are utilized by the chief operating decision maker, who is our Chief Executive Officer, for evaluating segment performance and allocating resources. We report our segment information based on the "management" approach. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of our reportable segments. For additional information on our segments refer to Note 1.

Segment results include the revenues and cost of services which are directly attributable to each segment. There are no indirect revenues or costs incurred that are allocated to the segments. There are planned intersegment advertising campaigns which will be eliminated. We had less than $1 of intersegment advertising revenue during each of the three and six months ended June 30, 2021 and 2020.

Segment revenue and gross profit were as follows during the period presented:

	For the Three Months Ended June 30, 2021
	Sirius XM		Pandora		Total
Revenue
Subscriber revenue	$	1,508	$	133	$	1,641
Advertising revenue	46		383		429
Equipment revenue	51		—		51
Other revenue	38		—		38
Total revenue	1,643		516		2,159
Cost of services (a)	(647)		(323)		(970)
Segment gross profit	$	996	$	193	$	1,189

The reconciliation between reportable segment gross profit to consolidated income before income tax is as follows:

	For the Three Months Ended June 30, 2021
Segment Gross Profit	$	1,189
Subscriber acquisition costs	(89)
Sales and marketing (a)	(227)
Engineering, design and development (a)	(59)
General and administrative (a)	(114)
Depreciation and amortization	(131)
Share-based payment expense	(47)
Impairment, restructuring and acquisition costs	136
Total other (expense) income	(98)
Consolidated income before income taxes	$	560

(a)     Share-based payment expense of $12 related to cost of services, $13 related to sales and marketing, $6 related to engineering, design and development and $16 related to general and administrative has been excluded.

	For the Three Months Ended June 30, 2020
	Sirius XM		Pandora		Total
Revenue
Subscriber revenue	$	1,453	$	125	$	1,578
Advertising revenue	25		211		236
Equipment revenue	25		—		25
Other revenue	35		—		35
Total revenue	1,538		336		1,874
Cost of services (b)	(593)		(263)		(856)
Segment gross profit	$	945	$	73	$	1,018

    The reconciliation between reportable segment gross profit to consolidated income before income tax is as follows:

	For the Three Months Ended June 30, 2020
Segment Gross Profit	$	1,018
Subscriber acquisition costs	(48)
Sales and marketing (b)	(201)
Engineering, design and development (b)	(52)
General and administrative (b)	(102)
Depreciation and amortization	(124)
Share-based payment expense	(52)
Impairment, restructuring and acquisition costs	(24)
Total other (expense) income	(98)
Consolidated income before income taxes	$	317

(b)     Share-based payment expense of $10 related to cost of services, $16 related to sales and marketing, $9 related to engineering, design and development and $17 related to general and administrative has been excluded.

	For the Six Months Ended June 30, 2021
	Sirius XM		Pandora		Total
Revenue
Subscriber revenue	$	2,989	$	263	$	3,252
Advertising revenue	87		696		783
Equipment revenue	108		—		108
Other revenue	74		—		74
Total revenue	3,258		959		4,217
Cost of services (c)	(1,270)		(630)		(1,900)
Segment gross profit	$	1,988	$	329	$	2,317

The reconciliation between reportable segment gross profit to consolidated income before income tax is as follows:

	For the Six Months Ended June 30, 2021
Segment Gross Profit	$	2,317
Subscriber acquisition costs	(175)
Sales and marketing (c)	(428)
Engineering, design and development (c)	(113)
General and administrative (c)	(220)
Depreciation and amortization	(263)
Share-based payment expense	(98)
Impairment, restructuring and acquisition costs	(108)
Total other (expense) income	(195)
Consolidated income before income taxes	$	717

(c)     Share-based payment expense of $22 related to cost of services, $28 related to sales and marketing, $17 related to engineering, design and development and $31 related to general and administrative has been excluded.

	For the Six Months Ended June 30,2020
	Sirius XM		Pandora		Total
Revenue
Subscriber revenue	$	2,910	$	253	$	3,163
Advertising revenue	69		452		521
Equipment revenue	66		—		66
Other revenue	76		—		76
Total revenue	3,121		705		3,826
Cost of services (d)	(1,186)		(509)		(1,695)
Segment gross profit	$	1,935	$	196	$	2,131

The reconciliation between reportable segment gross profit to consolidated income before income tax is as follows:

	For the Six Months Ended June 30, 2020
Segment Gross Profit	$	2,131
Subscriber acquisition costs	(147)
Sales and marketing (d)	(409)
Engineering, design and development (d)	(112)
General and administrative (d)	(193)
Depreciation and amortization	(256)
Share-based payment expense	(107)
Impairment, restructuring and acquisition costs	(24)
Total other (expense) income	(193)
Consolidated income before income taxes	$	690

(d)     Share-based payment expense of $21 related to cost of services, $33 related to sales and marketing, $20 related to engineering, design and development and $33 related to general and administrative has been excluded.

A measure of segment assets is not currently provided to the Chief Executive Officer and has therefore not been provided.

As of June 30, 2021, long-lived assets were predominantly located in the United States. No individual foreign country represented a material portion of our consolidated revenue during the three and six months ended June 30, 2021 and 2020.