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Segmented Information

6 Months Ended

Jul. 31, 2025

Segmented Information

Segmented Information

Note 22 - Segmented Information

We review our operating results, assess our performance, make decisions about resources, and generate discrete financial information at the single enterprise level. Accordingly, we have determined that we operate in one reportable business segment providing logistics technology solutions.

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The Company has determined that it has a chief operating decision maker (“CODM”) comprised of the Company’s chief executive officer and president & chief operating officer. The CODM assesses performance for the Company and makes operating decisions based on consolidated net income and Adjusted EBITDA. The term “Adjusted EBITDA” refers to a financial measure that we define as earnings before certain charges that management considers to be non - operating expenses and which consist of interest, taxes, depreciation, amortization, stock - based compensation (for which we include related fees and taxes) and other charges (for which we include restructuring charges, acquisition - related expenses, and contingent consideration incurred due to better - than - expected performance from acquisitions). Management considers these non - operating expenses to be outside the scope of Descartes’ ongoing operations and the related expenses are not used by management to measure operations. Accordingly, these expenses are excluded from Adjusted EBITDA, which we reference to both measure our operations and as a basis of comparison of our operations from period - to - period. Adjusted EBITDA is a non - GAAP financial measure and may not be comparable to similarly titled measures reported by other companies. The CODM uses net income and adjusted EBITDA to assess overall performance of the Company and to evaluate whether to reinvest profits or invest in acquisitions. Asset information is not regularly provided to the CODM and as such the CODM does not make decisions based on assets.

The following table provides a breakdown of the measures of profit regularly provided to the CODM:

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​	​	​	​	​	​	​	​	​
​		Three Months Ended				Six Months Ended
​	​	July 31,	​	July 31,	​	July 31,	​	July 31,
​		2025		2024		2025		2024
Revenues		179,815		163,425		348,554		314,773
Less:
Headcount-related costs, including stock compensation expense		72,913		63,814		138,812		121,947
Cost of revenues and network charges (exclusive of other items presented separately)		17,231		17,473		33,113		31,739
SaaS software and maintenance		6,529		5,747		12,542		11,011
Other segment items		12,954		11,740		27,137		26,660
Depreciation		1,501		1,386		2,951		2,744
Amortization of intangible assets		20,504		17,419		39,618		32,443
​		131,632		117,579		254,173		226,544
Income from operations		48,183		45,846		94,381		88,229
Interest expense		(243)		(243)		(479)		(516)
Investment and other income		1,550		2,715		3,512		6,774
Income before taxes		49,490		48,318		97,414		94,487
Income tax expense		11,470		13,637		23,150		25,139
Net income, as reported on Consolidated Statements of Operations		38,020		34,681		74,264		69,348

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​	​	​	​	​	​	​	​	​
Adjustments to reconcile to Adjusted EBITDA:		​		​		​		​
Interest expense	​	243	​	243	​	479	​	516
Investment and other income		(1,550)		(2,715)		(3,512)		(6,774)
Income tax expense		11,470		13,637		23,150		25,139
Depreciation expense		1,501		1,386		2,951		2,744
Amortization of intangible assets		20,504		17,419		39,618		32,443
Stock-based compensation and related taxes		4,911		5,821		9,824		10,128
Other charges (Note 20)		5,119		150		8,568		4,068
Adjusted EBITDA		80,218		70,622		155,342		137,612

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Other segment items includes travel expenses, reseller fees, contractors, corporate cars, bad debt expense, occupancy, insurance, marketing, employee administrative costs, professional fees, board of director fees, foreign exchange gains and losses, and other expenses.

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The following tables provide our disaggregated revenue information by geographic location of customer and revenue type:

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​	​	​	​	​	​	​	​	​
​		Three Months Ended				Six Months Ended
​	​	July 31,		July 31,	​	July 31,		July 31,
​	​	2025	​	2024	​	2025	​	2024
Revenues
United States		121,530		109,631		234,962		211,196
Europe, Middle-East and Africa		42,326		38,426		82,725		73,560
Canada		10,781		10,389		20,668		20,360
Asia Pacific		5,178		4,979		10,199		9,657
​		179,815		163,425		348,554		314,773

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​	​	​	​	​	​	​	​	​
​		Three Months Ended				Six Months Ended
​	​	July 31,		July 31,	​	July 31,		July 31,
​	​	2025	​	2024	​	2025	​	2024
Revenues
Services		166,773		146,244		323,379		284,079
Professional services and other		12,825		15,795		24,618		28,768
License		217		1,386		557		1,926
​		179,815		163,425		348,554		314,773

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License revenues are derived from perpetual licenses granted to our customers to use our software products. Services revenues are comprised of ongoing transactional and/or subscription fees for use of our services and products by our customers and maintenance, which include revenues associated with maintenance and support of our services and products. Professional services and other revenues are comprised of professional services revenues from consulting, implementation and training services related to our services and products, hardware revenues and other revenues.

The following table provides information by geographic area of operation for our long-lived assets. Long-lived assets represent property and equipment and intangible assets that are attributed to geographic areas.

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​	​	​	​	​
​		July 31,		January 31,
​	​	2025	​	2025
Total long-lived assets
United States		282,657		246,048
Europe, Middle-East and Africa		48,197		49,737
Canada		26,071		31,007
Asia Pacific		6,179		6,959
​		363,104		333,751

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The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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