Share-based compensation liability

[Table of Contents](#i8fbc3dcd16fb4e35b37f64f296545b43_13)  
  
Reconciliations of total segment net revenues and total segment operating income to consolidated net revenues and consolidated income before income tax expense are presented in the table below (amounts in millions):  


|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  | Three Months Ended March 31, |  |
|  |  |  |  |  |  | 2022 |  | 2021 |  |  |  |  |  |
| Reconciliation to consolidated net revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Segment net revenues |  |  |  |  |  | $ | 1,409  |  |  | $ | 1,983  |  |  |  |  |  |  |
| Revenues from non-reportable segments (1) |  |  |  |  |  | 81  |  |  | 108  |  |  |  |  |  |  |
| Net effect from recognition (deferral) of deferred net revenues (2) |  |  |  |  |  | 287  |  |  | 209  |  |  |  |  |  |  |
| Elimination of intersegment revenues (3) |  |  |  |  |  | (9) |  |  | (25) |  |  |  |  |  |  |
| Consolidated net revenues |  |  |  |  |  | $ | 1,768  |  |  | $ | 2,275  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Reconciliation to consolidated income before income tax expense: |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Segment operating income |  |  |  |  |  | $ | 355  |  |  | $ | 853  |  |  |  |  |  |  |
| Operating income (loss) from non-reportable segments (1) |  |  |  |  |  | 19  |  |  | (4) |  |  |  |  |  |  |
| Net effect from recognition (deferral) of deferred net revenues and related cost of revenues (2) |  |  |  |  |  | 235  |  |  | 132  |  |  |  |  |  |  |
| Share-based compensation expense (4) |  |  |  |  |  | (98) |  |  | (151) |  |  |  |  |  |  |
| Amortization of intangible assets  |  |  |  |  |  | (2) |  |  | (5) |  |  |  |  |  |  |
| Restructuring and related costs  |  |  |  |  |  | 2  |  |  | (30) |  |  |  |  |  |  |
| Merger and acquisition-related fees and other expenses (5) |  |  |  |  |  | (32) |  |  | —  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Consolidated operating income |  |  |  |  |  | 479  |  |  | 795  |  |  |  |  |  |  |
| Interest and other expense (income), net |  |  |  |  |  | 14  |  |  | 30  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Consolidated income before income tax expense  |  |  |  |  |  | $ | 465  |  |  | $ | 765  |  |  |  |  |  |  |

  
(1)Includes other income and expenses outside of our reportable segments, including our Distribution business and unallocated corporate income and expenses.  
(2)Reflects the net effect from recognition (deferral) of deferred net revenues, along with related cost of revenues, on certain of our online-enabled products.   
(3)Intersegment revenues reflect licensing and service fees charged between segments.  
(4)Expenses related to share-based compensation, including $15 million for outstanding liability awards accounted for under ASC 718.  
(5)Reflects fees and other expenses related to our proposed transaction with Microsoft, primarily legal and advisory fees.

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |



|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |

16
