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Segments and Geographical Information
 3 Months Ended
Mar. 31, 2024
Segment Reporting [Abstract]  
Segments and Geographical Information Segments and Geographical Information
Segment Information

We report segment information based on the management approach. The management approach designates the internal reporting used by our Chief Operating Decision Maker for decision making and performance assessment as the basis for determining our reportable segments. The performance measures of our reportable segments include net revenues, gross profit and income from operations. Income from operations for each segment includes all geographic revenues, related cost of net revenues and operating expenses directly attributable to the reportable segment. Certain operating expenses are not directly attributable to a reportable segment and must be allocated. Each allocation is measured differently based on the nature of the cost being allocated. Certain other operating expense are not specifically allocated to segment income from operations and generally include various corporate expenses such as stock-based compensation and costs related to IT, facilities, human resources, accounting and finance, legal and regulatory, other separately managed general and administrative costs outside the reportable segments and restructuring costs. We group our operations into two reportable segments: Clear Aligner segment and Imaging Systems and CAD/CAM services (“Systems and Services”) segment.
Summarized financial information by segment is as follows (in thousands):

 Three Months Ended
March 31,
20242023
Net revenues
Clear Aligner$817,251 $789,804 
Systems and Services180,180 153,343 
Total net revenues$997,431 $943,147 
Gross profit
Clear Aligner$579,146 $566,139 
Systems and Services118,670 94,515 
Total gross profit$697,816 $660,654 
Income from operations
Clear Aligner$286,238 $277,521 
Systems and Services49,693 35,576 
Unallocated corporate expenses(181,796)(179,581)
Total income from operations$154,135 $133,516 
Stock-based compensation
Clear Aligner$3,764 $4,654 
Systems and Services359 321 
Unallocated corporate expenses34,665 32,760 
Total stock-based compensation$38,788 $37,735 
Depreciation and amortization
Clear Aligner
$14,433 $16,398 
Systems and Services
6,838 8,146 
Unallocated corporate expenses
11,675 11,276 
Total depreciation and amortization$32,946 $35,820 

The following table reconciles total segment income from operations in the table above to net income before provision for income taxes (in thousands):

 Three Months Ended
March 31,
20242023
Total segment income from operations$335,931 $313,097 
Unallocated corporate expenses(181,796)(179,581)
Total income from operations154,135 133,516 
Interest income4,392 2,337 
Other income (expense), net(141)(1,229)
Net income before provision for income taxes$158,386 $134,624 

Our Chief Operating Decision Maker does not regularly review total assets at the reportable segment level; however, we have provided geographical information related to our long-lived assets below.
Geographical Information

Net revenues are presented below by geographic area (in thousands):

 Three Months Ended
March 31,
 20242023
Net revenues 1:
U.S. $432,101 $411,138 
Switzerland251,758 313,131 
Other International 313,572 218,878 
Total net revenues$997,431 $943,147 

1 Net revenues are attributed to countries based on the location of where revenues are recognized by our legal entities.

Tangible long-lived assets, which includes Property, plant and equipment, net, and Operating lease right-of-use assets, net, are presented below by geographic area (in thousands):
 March 31,
2024		December 31, 2023
Long-lived assets 1:
Switzerland$573,000 $575,432 
U.S. 210,283 210,275 
Other International617,422 623,155 
Total long-lived assets$1,400,705 $1,408,862 
 
1 Long-lived assets are attributed to countries based on the location of our entity that owns or leases the assets.