Segment Reporting

The Company has two reportable segments: Sweet Baked Goods and In-Store Bakery. Previously, the Company’s reportable segments were Sweet Baked Goods and Other, which included In-Store Bakery, Hostess® branded bread and buns and frozen retail. A change in the Company’s internal reporting structure during the fourth quarter of 2017 caused the Company to reassess its reportable segments. The Company’s Sweet Baked Goods segment consists of fresh and frozen baked goods and bread products that are sold under the Hostess® and Dolly Madison® brands. The In-Store Bakery segment consists of Superior and Hostess branded products sold through the in-store bakery section of grocery and club stores.

The Company evaluates performance and allocates resources based on net revenue and gross profit. Information regarding the operations of these reportable segments is as follows:



(In thousands)	Year Ended December 31, 2017		From November 4 through December 31, 2016		From January 1 through November 3, 2016		Year Ended December 31, 2015
	(Successor)		(Successor)		(Predecessor)		(Predecessor)
Net revenue:
Sweet Baked Goods	$	733,827	$	105,211	$	595,645	$	620,815
In-Store Bakery	42,361		6,787		19,943		—
Net revenue	$	776,188	$	111,998	$	615,588	$	620,815

Depreciation and amortization (2):
Sweet Baked Goods	$	35,441	$	5,245	$	9,221	$	9,836
In-Store Bakery	2,729		598		1,044		—
Depreciation and amortization	$	38,170	$	5,843	$	10,265	$	9,836

Gross profit:
Sweet Baked Goods	$	316,916	$	37,387	$	262,930	$	262,203
In-Store Bakery	9,982		1,327		3,599		—
Gross profit	$	326,898	$	38,714	$	266,529	$	262,203

Capital expenditures (1):
Sweet Baked Goods	$	35,609	$	7,544	$	31,254	$	27,252
In-Store Bakery	774		83		223		—
Capital expenditures	$	36,383	$	7,627	$	31,477	$	27,252


(1)	Capital expenditures consists of purchases of property and equipment and acquisition and development of software assets paid in cash or acquired through accounts payable during the year ended December 31, 2017 (Successor), from November 4, 2016 through December 31, 2016 (Successor), from January 1 through November 3, 2016 (Predecessor) and the year ended December 31, 2016 (Predecessor).


(2)	Depreciation and amortization include charges to net income classified as costs of goods sold and general and administrative expenses on the consolidated statement of operations.

Total assets by reportable segment are as follows:



(In thousands)	December 31, 2017		December 31, 2016
	(Successor)		(Successor)
Total segment assets:
Sweet Baked Goods	$	2,884,642	$	2,754,514
In-Store Bakery	81,633		93,378
Total segment assets	$	2,966,275	$	2,847,892