NOTE 17 — OPERATING SEGMENTS AND RELATED INFORMATION

The Company's operating segments are evidence of the structure of the Company's internal organization. The NIKE Brand segments are defined by geographic regions for operations participating in NIKE Brand sales activity.

Each NIKE Brand geographic segment operates predominantly in one industry: the design, development, marketing and selling of athletic footwear, apparel and equipment. The Company's reportable operating segments for the NIKE Brand are: North America; Europe, Middle East & Africa; Greater China; and Asia Pacific & Latin America, and include results for the NIKE, Jordan and Hurley brands.

The Company's NIKE Direct operations are managed within each NIKE Brand geographic operating segment. Converse is also a reportable segment for the Company, and operates in one industry: the design, marketing, licensing and selling of casual sneakers, apparel and accessories.

Global Brand Divisions is included within the NIKE Brand for presentation purposes to align with the way management views the Company. Global Brand Divisions primarily represent NIKE Brand licensing businesses that are not part of a geographic operating segment, and demand creation and operating overhead expense, including product creation and design expenses that are centrally managed for the NIKE Brand, as well as costs associated with NIKE Direct global digital operations and enterprise technology.

Corporate consists primarily of unallocated general and administrative expenses, including expenses associated with centrally managed departments; depreciation and amortization related to the Company's headquarters; unallocated insurance, benefit and compensation programs, including stock-based compensation; and certain foreign currency gains and losses, including certain hedge gains and losses.

The primary financial measure used by the Company to evaluate performance of individual operating segments is earnings before interest and taxes (commonly referred to as “EBIT”), which represents Net income before Interest expense (income), net and Income tax expense in the Consolidated Statements of Income.

As part of the Company's centrally managed foreign exchange risk management program, standard foreign currency rates are assigned twice per year to each NIKE Brand entity in the Company's geographic operating segments and to Converse. These rates are set approximately nine and twelve months in advance of the future selling seasons to which they relate (specifically, for each currency, one standard rate applies to the fall and holiday selling seasons and one standard rate applies to the spring and summer selling seasons) based on average market spot rates in the calendar month preceding the date they are established. Inventories and Cost of sales for geographic operating segments and Converse reflect the use of these standard rates to record non-functional currency product purchases in the entity's functional currency. Differences between assigned standard foreign currency rates and actual market rates are included in Corporate, together with foreign currency hedge gains and losses generated from the Company's centrally managed foreign exchange risk management program and other conversion gains and losses.

Accounts receivable, net, Inventories and Property, plant and equipment, net for operating segments are regularly reviewed by management and are therefore provided below. Additions to long-lived assets as presented in the following table represent capital expenditures.



	YEAR ENDED MAY 31,
(Dollars in millions)	2019			2018			2017
REVENUES
North America	$	15,902		$	14,855		$	15,216
Europe, Middle East & Africa	9,812			9,242			7,970
Greater China	6,208			5,134			4,237
Asia Pacific & Latin America	5,254			5,166			4,737
Global Brand Divisions	42			88			73
Total NIKE Brand	37,218			34,485			32,233
Converse	1,906			1,886			2,042
Corporate	(7		)	26			75
TOTAL NIKE, INC. REVENUES	$	39,117		$	36,397		$	34,350
EARNINGS BEFORE INTEREST AND TAXES
North America	$	3,925		$	3,600		$	3,875
Europe, Middle East & Africa	1,995			1,587			1,507
Greater China	2,376			1,807			1,507
Asia Pacific & Latin America	1,323			1,189			980
Global Brand Divisions	(3,262		)	(2,658		)	(2,677		)
Total NIKE Brand	6,357			5,525			5,192
Converse	303			310			477
Corporate	(1,810		)	(1,456		)	(724		)
Total NIKE, Inc. Earnings Before Interest and Taxes	4,850			4,379			4,945
Interest expense (income), net	49			54			59
TOTAL NIKE, INC. INCOME BEFORE INCOME TAXES	$	4,801		$	4,325		$	4,886
ADDITIONS TO LONG-LIVED ASSETS
North America	$	117		$	196		$	223
Europe, Middle East & Africa	233			240			173
Greater China	49			76			51
Asia Pacific & Latin America	47			49			59
Global Brand Divisions	278			286			278
Total NIKE Brand	724			847			784
Converse	18			22			30
Corporate	333			325			387
TOTAL ADDITIONS TO LONG-LIVED ASSETS	$	1,075		$	1,194		$	1,201
DEPRECIATION
North America	$	149		$	160		$	140
Europe, Middle East & Africa	111			116			106
Greater China	50			56			54
Asia Pacific & Latin America	53			55			54
Global Brand Divisions	195			217			233
Total NIKE Brand	558			604			587
Converse	31			33			28
Corporate	116			110			91
TOTAL DEPRECIATION	$	705		$	747		$	706



	AS OF MAY 31,
(Dollars in millions)	2019		2018
ACCOUNTS RECEIVABLE, NET
North America	$	1,718	$	1,443
Europe, Middle East & Africa	1,164		870
Greater China	245		101
Asia Pacific & Latin America	771		720
Global Brand Divisions	105		102
Total NIKE Brand	4,003		3,236
Converse	243		240
Corporate	26		22
TOTAL ACCOUNTS RECEIVABLE, NET	$	4,272	$	3,498
INVENTORIES
North America	$	2,328	$	2,270
Europe, Middle East & Africa	1,390		1,433
Greater China	693		580
Asia Pacific & Latin America	694		687
Global Brand Divisions	126		91
Total NIKE Brand	5,231		5,061
Converse	269		268
Corporate	122		(68		)
TOTAL INVENTORIES	$	5,622	$	5,261
PROPERTY, PLANT AND EQUIPMENT, NET
North America	$	814	$	848
Europe, Middle East & Africa	929		849
Greater China	237		256
Asia Pacific & Latin America	326		339
Global Brand Divisions	665		597
Total NIKE Brand	2,971		2,889
Converse	100		115
Corporate	1,673		1,450
TOTAL PROPERTY, PLANT AND EQUIPMENT, NET	$	4,744	$	4,454

REVENUES AND LONG-LIVED ASSETS BY GEOGRAPHIC AREA

After allocation of revenues for Global Brand Divisions, Converse and Corporate to geographical areas based on the location where the sales originated, revenues by geographical area are essentially the same as reported above for the NIKE Brand operating segments with the exception of the United States. Revenues derived in the United States were $16,091 million, $15,314 million and $15,778 million for the years ended May 31, 2019, 2018 and 2017, respectively.

The Company's largest concentrations of long-lived assets primarily consist of the Company's world headquarters and distribution facilities in the United States, as well as distribution facilities in Belgium and China. Long-lived assets attributable to operations in these countries, which are primarily composed of property, plant and equipment, net, were as follows:



	AS OF MAY 31,
(Dollars in millions)	2019		2018
United States	$	3,174	$	2,930
Belgium	618		534
China	242		262