Segments

6 Months Ended

Jun. 30, 2020

14.

Segments

We organize our operations around, and publicly report our financial results on, three global business segments: (1) Advisory Services; (2) Global Workplace Solutions and (3) Real Estate Investments.

Advisory Services provides a comprehensive range of services globally, including property leasing, property sales, mortgage services, property management, project management and valuation. Global Workplace Solutions provides a broad suite of integrated, contractually-based outsourcing services to occupiers of real estate, including facilities management, project management and transaction services. Real Estate Investments includes: (i) investment management services provided globally; (ii) development services in the U.S. and U.K. and (iii) flexible office space solutions.

Summarized financial information by segment is as follows (dollars in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
		2020		2019		2020		2019
Revenue
Advisory Services	$	1,552,929	$	2,178,958	$	3,484,453	$	4,013,360
Global Workplace Solutions		3,666,844		3,385,452		7,413,018		6,551,367
Real Estate Investments		161,611		149,663		373,081		284,856
Total revenue	$	5,381,384	$	5,714,073	$	11,270,552	$	10,849,583

Adjusted EBITDA
Advisory Services	$	133,106	$	333,528	$	425,760	$	597,378
Global Workplace Solutions		115,947		104,060		215,245		203,739
Real Estate Investments		18,251		30,904		56,650		117,407
Total Adjusted EBITDA	$	267,304	$	468,492	$	697,655	$	918,524

Adjusted EBITDA is the measure reported to the chief operating decision maker (CODM) for purposes of making decisions about allocating resources to each segment and assessing performance of each segment. EBITDA represents earnings before net interest expense, write-off of financing costs on extinguished debt, income taxes, depreciation and amortization and asset impairments. Amounts shown for adjusted EBITDA further remove (from EBITDA) the impact of costs primarily associated with workforce optimization efforts in response to the COVID-19 pandemic, certain cash and non-cash items related to acquisitions, certain carried interest incentive compensation (reversal) expense to align with the timing of associated revenue, costs associated with our reorganization, including cost-savings initiatives, and other non-recurring costs.

Adjusted EBITDA is calculated as follows (dollars in thousands):

	Three Months Ended					Six Months Ended
	June 30,					June 30,
		2020			2019		2020			2019
Net income attributable to CBRE Group, Inc.	$	81,897		$	223,731	$	254,092		$	388,140
Add:
Depreciation and amortization		116,384			106,479		230,178			212,302
Asset impairments		—			—		75,171			89,037
Interest expense, net of interest income		17,950			24,600		33,966			45,792
Write-off of financing costs on extinguished debt		—			—		—			2,608
Provision for income taxes		18,803			62,521		69,985			106,399
EBITDA		235,034			417,331		663,392			844,278
Adjustments:
Costs associated with workforce optimization efforts (1)		37,594			—		37,594			—
Impact of fair value adjustments to real estate assets acquired in the Telford Acquisition (purchase accounting) that were sold in period		1,247			—		7,000			—
Costs incurred related to legal entity restructuring		693			—		3,934			—
Integration and other costs related to acquisitions		236			9,037		1,019			9,037
Carried interest incentive compensation (reversal) expense to align with the timing of associated revenue		(7,500	)		8,308		(15,284	)		15,644
Costs associated with our reorganization, including cost-savings initiatives (2)		—			33,816		—			49,565
Adjusted EBITDA	$	267,304		$	468,492	$	697,655		$	918,524

(1)

Primarily represents costs incurred related to workforce optimization initiated and executed in the second quarter of 2020 as part of management’s cost containment efforts in response to the COVID-19 pandemic. The charges are cash expenditures primarily for severance costs incurred related to this effort. Of the total costs, $7.4 million was included within the “Cost of revenue” line item and $30.2 million was included in the “Operating, administrative, and other” line item in the accompanying consolidated statements of operations for both the three and six months ended June 30, 2020.

(2)	Primarily represents severance costs related to headcount reductions in connection with our reorganization announced in the third quarter of 2018 that became effective January 1, 2019.

Our CODM is not provided with total asset information by segment and accordingly, does not measure or allocate total assets on a segment basis. As a result, we have not disclosed any asset information by segment.

Geographic Information

Revenue in the table below is allocated based upon the country in which services are performed (dollars in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
		2020		2019		2020		2019
Revenue
United States	$	3,089,794	$	3,372,201	$	6,470,357	$	6,408,907
United Kingdom		677,880		657,005		1,451,895		1,245,587
All other countries		1,613,710		1,684,867		3,348,300		3,195,089
Total revenue	$	5,381,384	$	5,714,073	$	11,270,552	$	10,849,583