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Segment Information
 9 Months Ended
Jun. 30, 2017
Segment Reporting [Abstract]  
Segment Information
Segment Information
We are organized into the following three operating segments, each of which is a reportable segment, to align with internal management of our worldwide business operations based on product offerings.
 
•
Applications. This segment includes pre-configured decision management applications designed for a specific type of business problem or process — such as marketing, account origination, customer management, fraud, collections and insurance claims management — as well as associated professional services. These applications are available to our customers as on-premises software, and many are available as hosted, software-as-a-service (“SaaS”) applications through the FICO® Analytic Cloud.
•
Scores. This segment includes our business-to-business scoring solutions, our myFICO® solutions for consumers and associated professional services. Our scoring solutions give our clients access to analytics that can be easily integrated into their transaction streams and decision-making processes. Our scoring solutions are distributed through major credit reporting agencies, as well as services through which we provide our scores to clients directly.
•
Decision Management Software. This segment is composed of analytic and decision management software tools that clients can use to create their own custom decision management applications, our new FICO® Decision Management Suite, as well as associated professional services. These tools are available to our customers as on-premises software or through the FICO® Analytic Cloud.
Our Chief Executive Officer evaluates segment financial performance based on segment revenues and segment operating income. Segment operating expenses consist of direct and indirect costs principally related to personnel, facilities, consulting, travel and depreciation. Indirect costs are allocated to the segments generally based on relative segment revenues, fixed rates established by management based upon estimated expense contribution levels and other assumptions that management considers reasonable. We do not allocate broad-based incentive expense, share-based compensation expense, restructuring expense, amortization expense, various corporate charges and certain other income and expense measures to our segments. These income and expense items are not allocated because they are not considered in evaluating the segment’s operating performance. Our Chief Executive Officer does not evaluate the financial performance of each segment based on its respective assets, nor capital expenditures where depreciation amounts are allocated to the segments from their internal cost centers as described above.
The following tables summarize segment information for the quarters and nine-month periods ended June 30, 2017 and 2016: 
 
Quarter Ended June 30, 2017
 
Applications
 
Scores
 
Decision Management Software
 
Unallocated
Corporate
Expenses
 
Total
 
(In thousands)
Segment revenues:
 
 
 
 
 
 
 
 
 
Transactional and maintenance
$
87,443

 
$
68,376

 
$
10,876

 
$
—

 
$
166,695

Professional services
35,990

 
487

 
7,394

 
—

 
43,871

License
10,349

 
651

 
9,420

 
—

 
20,420

Total segment revenues
133,782

 
69,514

 
27,690

 
—

 
230,986

Segment operating expense
(95,357
)
 
(14,013
)
 
(31,312
)
 
(26,724
)
 
(167,406
)
Segment operating income (loss)
$
38,425

 
$
55,501

 
$
(3,622
)
 
$
(26,724
)
 
63,580

Unallocated share-based compensation expense
 
 
 
 
 
 
 
 
(14,315
)
Unallocated amortization expense
 
 
 
 
 
 
 
 
(3,365
)
Unallocated restructuring and acquisition-related
 
 
 
 
 
 
 
 
(4,471
)
Operating income
 
 
 
 
 
 
 
 
41,429

Unallocated interest expense, net
 
 
 
 
 
 
 
 
(6,653
)
Unallocated other income, net
 
 
 
 
 
 
 
 
555

Income before income taxes
 
 
 
 
 
 
 
 
$
35,331

Depreciation expense
$
3,931

 
$
239

 
$
1,196

 
$
331

 
$
5,697

 
Quarter Ended June 30, 2016
 
Applications
 
Scores
 
Decision Management Software
 
Unallocated
Corporate
Expenses
 
Total
 
(In thousands)
Segment revenues:
 
 
 
 
 
 
 
 
 
Transactional and maintenance
$
82,925

 
$
59,781

 
$
11,180

 
$
—

 
$
153,886

Professional services
36,560

 
822

 
6,922

 
—

 
44,304

License
22,080

 
527

 
17,981

 
—

 
40,588

Total segment revenues
141,565

 
61,130

 
36,083

 
—

 
238,778

Segment operating expense
(92,532
)
 
(14,321
)
 
(30,476
)
 
(29,240
)
 
(166,569
)
Segment operating income (loss)
$
49,033

 
$
46,809

 
$
5,607

 
$
(29,240
)
 
72,209

Unallocated share-based compensation expense
 
 
 
 
 
 
 
 
(13,404
)
Unallocated amortization expense
 
 
 
 
 
 
 
 
(3,486
)
Operating income
 
 
 
 
 
 
 
 
55,319

Unallocated interest expense, net
 
 
 
 
 
 
 
 
(6,781
)
Unallocated other income, net
 
 
 
 
 
 
 
 
1,752

Income before income taxes
 
 
 
 
 
 
 
 
$
50,290

Depreciation expense
$
2,961

 
$
211

 
$
947

 
$
354

 
$
4,473



 
Nine Months Ended June 30, 2017
 
Applications
 
Scores
 
Decision Management Software
 
Unallocated
Corporate
Expenses
 
Total
 
(In thousands)
Segment revenues:
 
 
 
 
 
 
 
 
 
Transactional and maintenance
$
258,337

 
$
190,256

 
$
33,011

 
$
—

 
$
481,604

Professional services
102,971

 
2,002

 
23,725

 
—

 
128,698

License
41,576

 
2,071

 
25,015

 
—

 
68,662

Total segment revenues
402,884

 
194,329

 
81,751

 
—

 
678,964

Segment operating expense
(294,608
)
 
(41,816
)
 
(91,549
)
 
(76,580
)
 
(504,553
)
Segment operating income (loss)
$
108,276

 
$
152,513

 
$
(9,798
)
 
$
(76,580
)
 
174,411

Unallocated share-based compensation expense
 
 
 
 
 
 
 
 
(43,546
)
Unallocated amortization expense
 
 
 
 
 
 
 
 
(9,997
)
Unallocated restructuring and acquisition-related
 
 
 
 
 
 
 
 
(4,471
)
Operating income
 
 
 
 
 
 
 
 
116,397

Unallocated interest expense, net
 
 
 
 
 
 
 
 
(19,403
)
Unallocated other income, net
 
 
 
 
 
 
 
 
128

Income before income taxes
 
 
 
 
 
 
 
 
$
97,122

Depreciation expense
$
11,758

 
$
741

 
$
3,524

 
$
1,021

 
$
17,044

 
Nine Months Ended June 30, 2016
 
Applications
 
Scores
 
Decision Management Software
 
Unallocated
Corporate
Expenses
 
Total
 
(In thousands)
Segment revenues:
 
 
 
 
 
 
 
 
 
Transactional and maintenance
$
244,659

 
$
174,263

 
$
32,779

 
$
—

 
$
451,701

Professional services
95,405

 
2,682

 
19,711

 
—

 
117,798

License
43,559

 
1,303

 
31,171

 
—

 
76,033

Total segment revenues
383,623

 
178,248

 
83,661

 
—

 
645,532

Segment operating expense
(267,924
)
 
(42,580
)
 
(82,890
)
 
(75,184
)
 
(468,578
)
Segment operating income (loss)
$
115,699

 
$
135,668

 
$
771

 
$
(75,184
)
 
176,954

Unallocated share-based compensation expense
 
 
 
 
 
 
 
 
(41,704
)
Unallocated amortization expense
 
 
 
 
 
 
 
 
(10,573
)
Operating income
 
 
 
 
 
 
 
 
124,677

Unallocated interest expense, net
 
 
 
 
 
 
 
 
(20,320
)
Unallocated other income, net
 
 
 
 
 
 
 
 
1,853

Income before income taxes
 
 
 
 
 
 
 
 
$
106,210

Depreciation expense
$
8,413

 
$
573

 
$
2,582

 
$
986

 
$
12,554