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Segment Reporting | 9 Months Ended
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Sep. 30, 2020
Segment Reporting [Abstract] |
Segment Reporting | Segment Reporting Our reportable segments correspond to how we organize and manage the business, as defined by our Chief Executive Officer, who is also our Chief Operating Decision Maker (CODM), and are aligned to the industries in which our clients operate. Our segments involve the delivery of business process services and include service arrangements where we manage a customer's business activity or process. In the first quarter of 2020, we realigned our sales organization and certain shared IT and other allocated functions to reflect how we currently manage our business. In the third quarter of 2020, in order to provide greater visibility into the profitability of our segments, certain costs that were previously included in the Shared IT/Infrastructure and Corporate Costs (now referred to as Unallocated Costs) are being allocated to each of the reportable segments. All prior periods presented have been recast to reflect these changes. Our financial performance is based on Segment Profit/(Loss) and Segment Adjusted EBITDA for our three reportable segments (Commercial Industries, Government Services and Transportation), Other and Unallocated Costs. Our CODM does not evaluate operating segments using discrete asset information. Commercial Industries: Our Commercial Industries segment provides business process services and customized solutions to clients in a variety of industries. Across the Commercial Industries segment, we operate on our clients’ behalf to deliver mission-critical solutions and services to reduce costs, improve efficiencies and enable revenue growth for our clients and their consumers and employees. Government Services: Our Government Services segment provides government-centric business process services to U.S. federal, state and local and foreign governments for public assistance, program administration, transaction processing and payment services. Our solutions in this segment help governments respond to changing rules for eligibility and increasing citizen expectations. Transportation: Our Transportation segment provides systems and support, as well as revenue-generating services, to government clients. On behalf of government agencies and authorities in the transportation industry, we deliver mission-critical mobility and payment solutions that improve automation, interoperability and decision-making to streamline operations, increase revenue and reduce congestion while creating safer communities and seamless travel experiences for consumers. Other includes our divestitures and our Student Loan business, which the Company exited in the third quarter of 2018. Unallocated Costs includes IT infrastructure costs that are shared by multiple reportable segments, enterprise application costs and certain corporate overhead expenses not directly attributable or allocated to our reportable segments. Selected financial information for our reportable segments was as follows:
|  | Three Months Ended September 30,
(in millions) |  | Commercial Industries |  | Government Services |  | Transportation |  | Other |  | Unallocated Costs |  | Total
2020 |  |  |  |  |  |  |  | Divestitures |  | Other |  |  |  |
Revenue |  | $ | 518 |  |  | $ | 348 |  |  | $ | 175 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 1,041 |
Segment profit (loss) |  | $ | 32 |  |  | $ | 122 |  |  | $ | 26 |  |  | $ | — |  |  | $ | 6 |  |  | $ | (98) |  |  | $ | 88 |
Segment depreciation and amortization |  | $ | 24 |  |  | $ | 6 |  |  | $ | 9 |  |  | $ | — |  |  | $ | — |  |  | $ | 14 |  |  | $ | 53 |
Adjusted EBITDA |  | $ | 56 |  |  | $ | 128 |  |  | $ | 35 |  |  | $ | — |  |  | $ | 6 |  |  | $ | (84) |  |  | $ | 141 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenue |  | $ | 578 |  |  | $ | 319 |  |  | $ | 201 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 1,098 |
Segment profit (loss) |  | $ | 60 |  |  | $ | 70 |  |  | $ | 25 |  |  | $ | — |  |  | $ | — |  |  | $ | (83) |  |  | $ | 72 |
Segment depreciation and amortization |  | $ | 27 |  |  | $ | 7 |  |  | $ | 9 |  |  | $ | — |  |  | $ | — |  |  | $ | 12 |  |  | $ | 55 |
Adjusted EBITDA |  | $ | 87 |  |  | $ | 77 |  |  | $ | 34 |  |  | $ | — |  |  | $ | — |  |  | $ | (71) |  |  | $ | 127 |
|  | Nine Months Ended September 30,
(in millions) |  | Commercial Industries |  | Government Services |  | Transportation |  | Other |  | Unallocated Costs |  | Total
2020 |  |  |  |  |  |  |  | Divestitures |  | Other |  |  |  |
Revenue |  | $ | 1,610 |  |  | $ | 969 |  |  | $ | 529 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 3,108 |
Segment profit (loss) |  | $ | 99 |  |  | $ | 282 |  |  | $ | 56 |  |  | $ | — |  |  | $ | 9 |  |  | $ | (258) |  |  | $ | 188 |
Segment depreciation and amortization |  | $ | 79 |  |  | $ | 19 |  |  | $ | 27 |  |  | $ | — |  |  | $ | — |  |  | $ | 41 |  |  | $ | 166 |
Adjusted EBITDA |  | $ | 178 |  |  | $ | 301 |  |  | $ | 83 |  |  | $ | — |  |  | $ | 2 |  |  | $ | (217) |  |  | $ | 347 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenue |  | $ | 1,782 |  |  | $ | 970 |  |  | $ | 579 |  |  | $ | 36 |  |  | $ | 1 |  |  | $ | — |  |  | $ | 3,368 |
Segment profit (loss) |  | $ | 198 |  |  | $ | 202 |  |  | $ | 50 |  |  | $ | 1 |  |  | $ | — |  |  | $ | (251) |  |  | $ | 200 |
Segment depreciation and amortization |  | $ | 76 |  |  | $ | 24 |  |  | $ | 27 |  |  | $ | — |  |  | $ | — |  |  | $ | 33 |  |  | $ | 160 |
Adjusted EBITDA |  | $ | 274 |  |  | $ | 226 |  |  | $ | 81 |  |  | $ | 1 |  |  | $ | — |  |  | $ | (218) |  |  | $ | 364 |
(in millions) |  |  |  | Three Months Ended September 30, |  | Nine Months Ended September 30,
Segment Profit (Loss) Reconciliation to Pre-tax Income (Loss) |  |  |  |  |  | 2020 |  | 2019 |  | 2020 |  | 2019
Income (Loss) Before Income Taxes |  |  |  |  |  | $ | (13) |  |  | $ | (14) |  |  | $ | (128) |  |  | $ | (1,471) |
Reconciling items: |  |  |  |  |  |  |  |  |  |  |  |
Amortization of acquired intangible assets |  |  |  |  |  | 60 |  |  | 61 |  |  | 180 |  |  | 184 |
Restructuring and related costs |  |  |  |  |  | 20 |  |  | 8 |  |  | 56 |  |  | 50 |
Interest expense |  |  |  |  |  | 14 |  |  | 20 |  |  | 46 |  |  | 60 |
Goodwill impairment |  |  |  |  |  | — |  |  | — |  |  | — |  |  | 1,351 |
(Gain) loss on divestitures and transaction costs |  |  |  |  |  | 8 |  |  | 3 |  |  | 14 |  |  | 19 |
Litigation costs (recoveries), net |  |  |  |  |  | — |  |  | 2 |  |  | 20 |  |  | 15 |
Other (income) expenses, net |  |  |  |  |  | (1) |  |  | (8) |  |  | — |  |  | (8) |
Segment Pre-tax Income (Loss) |  |  |  |  |  | $ | 88 |  |  | $ | 72 |  |  | $ | 188 |  |  | $ | 200 |
Segment depreciation and amortization (including contract inducements) |  |  |  |  |  | $ | 53 |  |  | $ | 55 |  |  | $ | 166 |  |  | $ | 160 |
CA MMIS charge (credit) |  |  |  |  |  | — |  |  | — |  |  | (7) |  |  | — |
Other adjustments |  |  |  |  |  | — |  |  | — |  |  | — |  |  | 4 |
Adjusted EBITDA |  |  |  |  |  | $ | 141 |  |  | $ | 127 |  |  | $ | 347 |  |  | $ | 364 |
Refer to Note 3 – Revenue for additional information on disaggregated revenues of the reportable segments.

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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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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