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Segment Information
9 Months Ended
Jun. 30, 2021
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 decision management applications designed for a specific type of business problem or process — such as marketing, account origination, customer management, fraud, financial crimes compliance, 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 or Amazon Web Services (“AWS”).
Scores. This segment includes our business-to-business scoring solutions and services, our business-to-consumer scoring solutions and services including 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 and services are either distributed through major credit reporting agencies worldwide or sold to our 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 FICO® Decision Management Suite, as well as associated professional services. Some of our decision management software is currently delivered as part of the FICO® Decision Management Platform and is increasingly being adopted to connect decisioning solutions or previously disconnected use cases. These tools are available to our customers as on-premises software, through the FICO® Analytic Cloud or AWS.
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, 2021 and 2020:
 Quarter Ended June 30, 2021
 ApplicationsScoresDecision Management SoftwareUnallocated
Corporate
Expenses
Total
 (In thousands)
Segment revenues:
Transactional and maintenance$99,822 $170,415 $17,841 $— $288,078 
Professional services26,381 166 9,371 — 35,918 
License7,010 1,621 5,557 — 14,188 
Total segment revenues133,213 172,202 32,769 — 338,184 
Segment operating expense(97,784)(25,418)(48,012)(33,820)(205,034)
Segment operating income (loss)$35,429 $146,784 $(15,243)$(33,820)133,150 
Unallocated share-based compensation expense(30,761)
Unallocated amortization expense(810)
Unallocated gains on product line asset sales and business divestiture92,805 
Operating income194,384 
Unallocated interest expense, net(10,018)
Unallocated other income, net3,526 
Income before income taxes$187,892 
Depreciation expense$3,920 $159 $934 $38 $5,051 
 Quarter Ended June 30, 2020
 ApplicationsScoresDecision Management SoftwareUnallocated
Corporate
Expenses
Total
 (In thousands)
Segment revenues:
Transactional and maintenance$98,476 $130,268 $18,085 $— $246,829 
Professional services32,364 58 11,211 — 43,633 
License10,620 1,224 11,425 — 23,269 
Total segment revenues141,460 131,550 40,721 — 313,731 
Segment operating expense(111,061)(21,333)(43,839)(31,315)(207,548)
Segment operating income (loss)$30,399 $110,217 $(3,118)$(31,315)106,183 
Unallocated share-based compensation expense(22,264)
Unallocated amortization expense(1,048)
Operating income82,871 
Unallocated interest expense, net(11,223)
Unallocated other expense, net4,560 
Income before income taxes$76,208 
Depreciation expense$5,091 $176 $1,156 $28 $6,451 

 Nine Months Ended June 30, 2021
 ApplicationsScoresDecision Management SoftwareUnallocated
Corporate
Expenses
Total
 (In thousands)
Segment revenues:
Transactional and maintenance$294,240 $476,217 $50,690 $— $821,147 
Professional services84,613 986 29,538 — 115,137 
License19,235 8,369 18,071 — 45,675 
Total segment revenues398,088 485,572 98,299 — 981,959 
Segment operating expense(299,785)(69,221)(138,532)(97,465)(605,003)
Segment operating income (loss)$98,303 $416,351 $(40,233)$(97,465)376,956 
Unallocated share-based compensation expense(84,099)
Unallocated amortization expense(2,692)
Unallocated gains on product line asset sales and business divestiture100,139 
Operating income390,304 
Unallocated interest expense, net(29,602)
Unallocated other income, net6,974 
Income before income taxes$367,676 
Depreciation expense$12,404 $520 $2,820 $116 $15,860 
 Nine Months Ended June 30, 2020
 ApplicationsScoresDecision Management SoftwareUnallocated
Corporate
Expenses
Total
 (In thousands)
Segment revenues:
Transactional and maintenance$295,102 $365,324 $47,479 $— $707,905 
Professional services101,521 1,141 32,901 — 135,563 
License37,294 9,371 30,073 — 76,738 
Total segment revenues433,917 375,836 110,453 — 920,206 
Segment operating expense(338,527)(54,705)(141,838)(99,310)(634,380)
Segment operating income (loss)$95,390 $321,131 $(31,385)$(99,310)285,826 
Unallocated share-based compensation expense(68,197)
Unallocated amortization expense(4,046)
Unallocated restructuring and impairment charges(3,104)
Operating income210,479 
Unallocated interest expense, net(32,245)
Unallocated other expense, net2,333 
Income before income taxes$180,567 
Depreciation expense$13,993 $433 $3,300 $361 $18,087 

Information about disaggregated revenue by product deployment methods was as follows:
Quarter Ended June 30, 2021
Reportable SegmentsOn-PremisesSaaSScoresTotalPercentage
(Dollars in thousands)
Applications$66,505 $66,708 $— $133,213 39 %
Scores— — 172,202 172,202 51 %
Decision Management Software20,519 12,250 — 32,769 10 %
      Total$87,024 $78,958 $172,202 $338,184 100 %
Quarter Ended June 30, 2020
Reportable SegmentsOn-PremisesSaaSScoresTotalPercentage
(Dollars in thousands)
Applications$76,493 $64,967 $— $141,460 45 %
Scores— — 131,550 131,550 42 %
Decision Management Software29,063 11,658 — 40,721 13 %
      Total$105,556 $76,625 $131,550 $313,731 100 %
Nine Months Ended June 30, 2021
Reportable SegmentsOn-PremisesSaaSScoresTotalPercentage
(Dollars in thousands)
Applications$203,907 $194,181 $— $398,088 41 %
Scores— — 485,572 485,572 49 %
Decision Management Software65,584 32,715 — 98,299 10 %
      Total$269,491 $226,896 $485,572 $981,959 100 %
Nine Months Ended June 30, 2020
Reportable SegmentsOn-PremisesSaaSScoresTotalPercentage
(Dollars in thousands)
Applications$238,812 $195,105 $— $433,917 47 %
Scores— — 375,836 375,836 41 %
Decision Management Software81,589 28,864 — 110,453 12 %
      Total$320,401 $223,969 $375,836 $920,206 100 %
Information about disaggregated revenue by primary geographical markets was as follows:
Quarter Ended June 30, 2021
Reportable SegmentsNorth AmericaLatin AmericaEurope, Middle East and AfricaAsia PacificTotal
(In thousands)
Applications$74,718 $10,883 $34,459 $13,153 $133,213 
Scores165,264 275 2,988 3,675 172,202 
Decision Management Software13,628 4,398 10,422 4,321 32,769 
      Total$253,610 $15,556 $47,869 $21,149 $338,184 
Quarter Ended June 30, 2020
Reportable SegmentsNorth AmericaLatin AmericaEurope, Middle East and AfricaAsia PacificTotal
(In thousands)
Applications$78,639 $12,069 $34,175 $16,577 $141,460 
Scores128,686 113 1,505 1,246 131,550 
Decision Management Software23,164 4,626 8,427 4,504 40,721 
      Total$230,489 $16,808 $44,107 $22,327 $313,731 
Nine Months Ended June 30, 2021
Reportable SegmentsNorth AmericaLatin AmericaEurope, Middle East and AfricaAsia PacificTotal
(In thousands)
Applications$224,172 $29,222 $104,629 $40,065 $398,088 
Scores464,721 3,318 10,343 7,190 485,572 
Decision Management Software47,689 10,240 28,120 12,250 98,299 
      Total$736,582 $42,780 $143,092 $59,505 $981,959 
Nine Months Ended June 30, 2020
Reportable SegmentsNorth AmericaLatin AmericaEurope, Middle East and AfricaAsia PacificTotal
(In thousands)
Applications$243,005 $31,258 $108,230 $51,424 $433,917 
Scores362,132 3,016 4,763 5,925 375,836 
Decision Management Software59,758 14,876 22,612 13,207 110,453 
      Total$664,895 $49,150 $135,605 $70,556 $920,206