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Segment Information | 12 Months Ended
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Dec. 31, 2017
Segment Information |
Segment Information | Note 21 Segment Information During the fourth quarter of 2017, we effected a change in the reporting of our segments to better reflect our product offerings and growing significance of our Nabors Drilling Solutions business. The expansion of our tubular services offering attributable to the acquisition of Tesco during the fourth quarter, along with management’s increasing focus on the strategic aspect of this business and expectation of future growth, culminated in the decision to break this operation out into its own segment called Drilling Solutions. This operation was historically included within our Rig Services segment, which we have renamed Rig Technologies and now primarily reflects the oilfield equipment manufacturing, rental and aftermarket service business of Canrig. Our segment information has been revised to conform to the new reportable segments. Our business now consists of five reportable segments: U.S., Canada, International, Drilling Solutions and Rig Technologies. The reportable segments within the Completion & Production Services business reflect historical operating information through the closing date of the merger with CJES. The accounting policies of the segments are the same as those described in Note 2—Summary of Significant Accounting Policies. Inter-segment sales are recorded at cost or cost plus a profit margin. We evaluate the performance of our segments based on several criteria, including adjusted operating income (loss). The following table sets forth financial information with respect to our reportable operating segments:
|  |  |  | Year Ended December 31, |
|  |  |  | 2017 |  | 2016 |  | 2015 |
|  |  |  | (In thousands) |
Operating revenues: |  |  |  |  |  |  |  |  |  |  |  |
Drilling & Rig Technologies: |  |  |  |  |  |  |  |  |  |  |  |
U.S. |  |  |  | $ | 805,223 |  | $ | 554,072 |  | $ | 1,256,989 |
Canada |  |  |  |  | 82,929 |  |  | 51,472 |  |  | 137,494 |
International |  |  |  |  | 1,474,060 |  |  | 1,508,890 |  |  | 1,862,393 |
Drilling Solutions |  |  |  |  | 140,701 |  |  | 63,759 |  |  | 69,828 |
Rig Technologies |  |  |  |  | 234,542 |  |  | 151,951 |  |  | 321,238 |
Subtotal Drilling & Rig Technologies |  |  |  |  | 2,737,455 |  |  | 2,330,144 |  |  | 3,647,942 |
Completion & Production Services: |  |  |  |  |  |  |  |  |  |  |  |
Completion Services |  |  |  |  | — |  |  | — |  |  | 207,860 |
Production Services |  |  |  |  | — |  |  | — |  |  | 158,512 |
Subtotal Completion & Production Services |  |  |  |  | — |  |  | — |  |  | 366,372 |
Other reconciling items (1) |  |  |  |  | (173,170) |  |  | (102,305) |  |  | (149,877) |
Total |  |  |  | $ | 2,564,285 |  | $ | 2,227,839 |  | $ | 3,864,437 |
|  |  |  | Year Ended December 31, |
|  |  |  | 2017 |  | 2016 |  | 2015 |
|  |  |  | (In thousands) |
Adjusted operating income (loss): (2) |  |  |  |  |  |  |  |  |  |  |  |
Drilling & Rig Technologies: |  |  |  |  |  |  |  |  |  |  |  |
U.S. |  |  |  | $ | (213,877) |  | $ | (197,710) |  | $ | 87,051 |
Canada |  |  |  |  | (22,262) |  |  | (36,818) |  |  | (7,029) |
International |  |  |  |  | 108,428 |  |  | 164,677 |  |  | 308,262 |
Drilling Solutions |  |  |  |  | 16,738 |  |  | (16,503) |  |  | (10,879) |
Rig Technologies |  |  |  |  | (30,964) |  |  | (31,981) |  |  | (1,762) |
Subtotal Drilling & Rig Technologies |  |  |  |  | (141,937) |  |  | (118,335) |  |  | 375,643 |
Completion & Production Services: |  |  |  |  |  |  |  |  |  |  |  |
Completion Services |  |  |  |  | — |  |  | — |  |  | (55,243) |
Production Services |  |  |  |  | — |  |  | — |  |  | (3,559) |
Subtotal Completion & Production Services |  |  |  |  | — |  |  | — |  |  | (58,802) |
Total segment adjusted operating income (loss) |  |  |  | $ | (141,937) |  | $ | (118,335) |  | $ | 316,841 |
|  |  |  | Year Ended December 31, |
|  |  |  | 2017 |  | 2016 |  | 2015 |
|  |  |  | (In thousands) |
Reconciliation of segment adjusted operating income (loss) to net income (loss) from continuing operations before income taxes: |  |  |  |  |  |  |  |  |  |  |  |
Total segment adjusted operating income (loss) (2) |  |  |  | $ | (141,937) |  | $ | (118,335) |  | $ | 316,841 |
Other reconciling items (3) |  |  |  |  | (157,043) |  |  | (130,976) |  |  | (159,880) |
Earnings (losses) from unconsolidated affiliates |  |  |  |  | 7 |  |  | (221,914) |  |  | (75,081) |
Investment income (loss) |  |  |  |  | 1,194 |  |  | 1,183 |  |  | 2,308 |
Interest expense |  |  |  |  | (222,889) |  |  | (185,360) |  |  | (181,928) |
Impairments and other charges |  |  |  |  | (44,536) |  |  | (498,499) |  |  | (368,967) |
Other, net |  |  |  |  | (14,880) |  |  | (44,174) |  |  | 39,172 |
Income (loss) from continuing operations before income taxes |  |  |  | $ | (580,084) |  | $ | (1,198,075) |  | $ | (427,535) |
|  | Year Ended December 31, |
|  | 2017 |  | 2016 |  | 2015 |
|  | (In thousands) |
Depreciation and amortization |  |  |  |  |  |  |  |  |  |
Drilling & Rig Technologies: |  |  |  |  |  |  |  |  |  |
U.S. |  | $ | 375,171 |  | $ | 388,367 |  | $ | 425,952 |
Canada |  |  | 39,597 |  |  | 42,143 |  |  | 46,786 |
International |  |  | 400,753 |  |  | 411,372 |  |  | 411,004 |
Drilling Solutions |  |  | 16,188 |  |  | 18,598 |  |  | 11,221 |
Rig Technologies |  |  | 11,530 |  |  | 14,552 |  |  | 22,398 |
Subtotal Drilling & Rig Technologies |  |  | 843,239 |  |  | 875,032 |  |  | 917,361 |
Completion & Production Services: |  |  |  |  |  |  |  |  |  |
Completion Services |  |  | — |  |  | — |  |  | 27,133 |
Production Services |  |  | — |  |  | — |  |  | 26,602 |
Subtotal Completion & Production Services |  |  | — |  |  | — |  |  | 53,735 |
Other reconciling items (3) |  |  | (296) |  |  | (3,401) |  |  | (637) |
Total |  | $ | 842,943 |  | $ | 871,631 |  | $ | 970,459 |
|  | Year Ended December 31, |
|  | 2017 |  | 2016 |  | 2015 |
|  | (In thousands) |
Capital expenditures and acquisitions of businesses: |  |  |  |  |  |  |  |  |  |
Drilling & Rig Technologies: |  |  |  |  |  |  |  |  |  |
U.S. |  | $ | 330,875 |  | $ | 183,146 |  | $ | 224,819 |
Canada |  |  | 17,197 |  |  | 4,546 |  |  | 24,167 |
International |  |  | 159,817 |  |  | 169,640 |  |  | 578,896 |
Drilling Solutions |  |  | 58,925 |  |  | 21,606 |  |  | 5,506 |
Rig Technologies |  |  | 42,368 |  |  | 2,003 |  |  | 7,285 |
Subtotal Drilling & Rig Technologies |  |  | 609,182 |  |  | 380,941 |  |  | 840,673 |
Completion & Production Services |  |  | — |  |  | — |  |  | 45,691 |
Other reconciling items (3) |  |  | (8,273) |  |  | 33,438 |  |  | 36,872 |
Total |  | $ | 600,909 |  | $ | 414,379 |  | $ | 923,236 |
|  | December 31, |
|  | 2017 |  | 2016 |
|  | (In thousands) |
Total assets: |  |  |  |  |  |  |
Drilling & Rig Technologies: |  |  |  |  |  |  |
U.S. |  | $ | 3,203,560 |  | $ | 3,172,767 |
Canada |  |  | 347,773 |  |  | 329,620 |
International |  |  | 3,540,829 |  |  | 3,600,057 |
Drilling Solutions |  |  | 182,162 |  |  | 81,490 |
Rig Technologies |  |  | 459,665 |  |  | 277,945 |
Subtotal Drilling & Rig Technologies |  |  | 7,733,989 |  |  | 7,461,879 |
Other reconciling items (3) |  |  | 667,995 |  |  | 725,136 |
Total |  | $ | 8,401,984 |  | $ | 8,187,015 |
| (1) |  | Represents the elimination of inter-segment transactions.
| (2) |  | Adjusted operating income (loss) is computed by subtracting the sum of direct costs, general and administrative expenses, research and engineering expenses and depreciation and amortization from operating revenues. Management evaluates the performance of our reportable segments using adjusted operating income (loss), which is a segment performance measure, because it believes that this financial measure reflects our ongoing profitability and performance. In addition, securities analysts and investors use this measure as one of the metrics on which they analyze our performance. A reconciliation to income (loss) from continuing operations before income taxes is provided in the above table.
| (3) |  | Represents the elimination of inter-segment transactions and unallocated corporate expenses, assets and capital expenditures.
The following table sets forth financial information with respect to Nabors’ operations by geographic area based on the location of service provided:
|  | Year Ended December 31, |
|  | 2017 |  | 2016 |  | 2015 |
|  | (In thousands) |
Operating revenues |  |  |  |  |  |  |  |  |  |
U.S. |  | $ | 973,464 |  | $ | 642,835 |  | $ | 1,823,906 |
Outside the U.S. |  |  | 1,590,821 |  |  | 1,585,004 |  |  | 2,040,531 |
|  | $ | 2,564,285 |  | $ | 2,227,839 |  | $ | 3,864,437 |
Property, plant and equipment, net: |  |  |  |  |  |  |  |  |  |
U.S. |  | $ | 3,163,425 |  | $ | 3,048,749 |  | $ | 3,703,533 |
Outside the U.S. |  |  | 2,946,140 |  |  | 3,218,834 |  |  | 3,324,269 |
|  | $ | 6,109,565 |  | $ | 6,267,583 |  | $ | 7,027,802 |
Goodwill: |  |  |  |  |  |  |  |  |  |
U.S. |  | $ | 54,198 |  | $ | 54,199 |  | $ | 54,198 |
Outside the U.S. |  |  | 119,028 |  |  | 112,718 |  |  | 112,461 |
|  | $ | 173,226 |  | $ | 166,917 |  | $ | 166,659 |
During the years ended December 31, 2017, 2016 and 2015, $727.7 million, $731.4 million and $604.5 million of our consolidated operating revenue was from Saudi Arabia. No other individual country outside of the U.S. was material to our consolidated operating revenue during any of the three periods presented. One customer accounted for approximately 29%, 33% and 12% of our consolidated operating revenues during the years ended December 31, 2017, 2016 and 2015, respectively, and is included in our International drilling reportable segment.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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