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Segment Information
12 Months Ended
Sep. 30, 2021
Segment Reporting [Abstract]  
Segment Information Segment Information
During the fourth quarter of our fiscal 2021, we reevaluated our operating segments to better align with how our CODM, who is our Chief Executive Officer, evaluates performance and allocates resources. The key factors evaluated included our evolving platform strategies, our go-to market considerations, and sales of our product lines and businesses during fiscal 2021, and in particular the divestiture of our C&R business in June 2021, among others. As a result, we consolidated our operating segment structure from three to two by merging Applications and Decision Management Software segments into the new Software segment. All periods presented have been adjusted to reflect these changes. The new segments are as follows:
Scores. This segment includes our business-to-business (“B2B”) scoring solutions and services which give our clients access to predictive credit and other scores that can be easily integrated into their transaction streams and decision-making processes. This segment also includes our business-to-consumer (“B2C”) scoring solutions, including our myFICO.com subscription offerings.
Software. This segment includes pre-configured analytic and decision management solutions designed for a specific type of business need or process — such as account origination, customer management, customer engagement, fraud detection, financial crimes compliance, and marketing — as well as associated professional services. This segment also includes FICO® Platform, a modular software offering designed to support advanced analytic and decision use cases, as well as stand-alone analytic and decisioning software that can be configured by our customers to address a wide variety of business use cases. These offerings are available to our customers as SaaS or as on-premises software.
Our CODM 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 and acquisition-related 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 or capital expenditures; rather, depreciation amounts are allocated to the segments from their internal cost centers as described above.
The following tables summarize segment information for fiscal 2021, 2020 and 2019: 
 Year Ended September 30, 2021
 ScoresSoftwareUnallocated
Corporate
Expenses
Total
 (In thousands)
Segment revenues:
On-premises and SaaS software$— $517,888 $— $517,888 
Professional services— 144,501 — 144,501 
Scores654,147 — — 654,147 
Total segment revenues654,147 662,389 — 1,316,536 
Segment operating expense(93,463)(557,242)(136,812)(787,517)
Segment operating income$560,684 $105,147 $(136,812)$529,019 
Unallocated share-based compensation expense(112,457)
Unallocated amortization expense(3,255)
Unallocated restructuring and impairment charges(7,957)
Unallocated gains on product line asset sales and business divestiture100,139 
Operating income505,489 
Unallocated interest expense, net(40,092)
Unallocated other income, net7,745 
Income before income taxes$473,142 
Depreciation expense$667 $19,505 $147 $20,319 
 
 Year Ended September 30, 2020
 ScoresSoftwareUnallocated
Corporate
Expenses
Total
 (In thousands)
Segment revenues:
On-premises and SaaS software$— $584,576 $— $584,576 
Professional services— 181,439 — 181,439 
Scores528,547 — — 528,547 
Total segment revenues528,547 766,015 — 1,294,562 
Segment operating expense(74,237)(635,949)(144,704)(854,890)
Segment operating income$454,310 $130,066 $(144,704)439,672 
Unallocated share-based compensation expense(93,681)
Unallocated amortization expense(4,993)
Unallocated restructuring and impairment charges(45,029)
Operating income295,969 
Unallocated interest expense, net(42,177)
Unallocated other income, net3,208 
Income before income taxes$257,000 
Depreciation expense$617 $22,418 $418 $23,453 

 
 Year Ended September 30, 2019
 ScoresSoftwareUnallocated
Corporate
Expenses
Total
 (In thousands)
Segment revenues:
On-premises and SaaS software$— $556,968 $— $556,968 
Professional services— 181,938 — 181,938 
Scores421,177 — — 421,177 
Total segment revenues421,177 738,906 — 1,160,083 
Segment operating expense(59,821)(612,860)(144,755)(817,436)
Segment operating income$361,356 $126,046 $(144,755)342,647 
Unallocated share-based compensation expense(82,973)
Unallocated amortization expense(6,126)
Operating income253,548 
Unallocated interest expense, net(39,752)
Unallocated other income, net2,276 
Income before income taxes$216,072 
Depreciation expense$498 $22,802 $904 $24,204