Segment Information

12 Months Ended

Sep. 30, 2019

The Company provides operating results in four reportable segments: GovDeals, Capital Assets Group (CAG), Retail Supply Chain Group (RSCG), Machinio. The Company's reportable segments constituted over 99% of the Company's revenue for the year ended September 30, 2019. Descriptions of our reportable segments are as follows:

•The GovDeals reportable segment provides self-directed service solutions in which Sellers list their own assets, and it consists of marketplaces that enable local and state government entities including city, county and state agencies, as well as commercial businesses located in the United States and Canada to sell surplus and salvage assets. GovDeals also offers a suite of services to Sellers that includes asset sales and marketing. This segment includes the Company's GovDeals.com and AuctionDeals.com marketplaces.

•The CAG reportable segment provides full-service solutions to Sellers and it consists of marketplaces that enable commercial businesses to sell surplus, salvage, and scrap assets. CAG also offers a suite of services that includes surplus management, asset valuation, asset sales and marketing. Commercial Sellers are located in the United States, Europe, Australia and Asia. This segment includes the Company's Network International and GoIndustry DoveBid marketplaces. Prior to the conclusion of the Scrap and Surplus Contracts (see Note 3), CAG sold surplus and scrap assets from the DoD on its Government Liquidation marketplace.

•The RSCG reportable segment consists of marketplaces that enable corporations located in the United States and Canada to sell surplus and salvage consumer goods and retail capital assets. RSCG also offers a suite of services that includes returns management, asset recovery, and e-commerce services. This segment includes the Company's Liquidation.com, Liquidation.com DIRECT, and Secondipity marketplaces.

•The Machinio reportable segment operates a global online platform for listing used equipment for sale in the construction, machine tool, transportation, printing and agriculture sectors. Machinio was acquired by the Company on July 10, 2018.

We also report results of Corporate & Other, which combines two previously existing operating segments that did not meet the quantitative thresholds to be reportable segments, IronDirect and TruckCenter, with corporate activity and elimination adjustments. The Company exited the TruckCenter business in January 2017 and exited the IronDirect business in January 2019.

Decisions concerning the allocation of the Company’s resources are made by the Company’s Chief Operating Decision Maker ("CODM"), which is the Company's Chief Executive Officer, with oversight by the Board of Directors. The Company reports segment information based on the internal performance measures used by the CODM to assess the performance of each operating segment in a given period. In connection with that assessment, the CODM uses segment gross profit to evaluate the performance of each segment. Gross profit is calculated as total revenue less cost of goods sold and seller distributions.

The following table sets forth certain financial information for the Company's reportable segments:


		Year Ended September 30,
(in thousands)				2019			2018			2017
GovDeals:
	Revenue	$	—		$	—		$	—
	Fee revenue	32,936			30,214			26,853
	Total revenue	32,936			30,214			26,853
	Gross profit	30,386			27,990			25,172

CAG:
	Revenue	36,684			57,717			100,160
	Fee revenue	23,558			30,308			44,971
	Total revenue	60,242			88,025			145,131
	Gross profit	32,679			48,873			71,934

RSCG:
	Revenue	110,736			88,295			85,766
	Fee revenue	16,585			13,659			9,265
	Total revenue	127,321			101,954			95,032
	Gross profit	44,967			33,009			30,050

Machinio:
	Revenue	—			—			—
	Fee revenue	5,598			653			—
	Total revenue	5,598			653			—
	Gross profit	5,196			501			—

Corporate & Other:
	Revenue	469			3,665			2,644
	Fee revenue	(41)			3			356
	Total revenue	428			3,668			2,999
	Gross profit	52			(661)			(2,666)

Consolidated:
	Revenue	147,889			149,677			188,570
	Fee revenue	78,636			74,837			81,445
	Total revenue	226,525			224,514			270,015
	Gross profit	113,280			109,712			124,490

The following table presents a reconciliation between gross profit used in the reportable segments and the Company's consolidated results:


		Year Ended September 30,
(in thousands)			2019		2018		2017
Reconciliation:
	Gross profit	113,280		109,712		124,490
	Operating expenses	127,739		130,048		161,083
	Other operating expenses	5,049		1,392		3,651
	Interest (income) expense and other expense, net	(1,448)		(785)		(606)
	Loss before provision for income taxes	(18,060)		(20,943)		(39,638)

Total segment assets reconciled to consolidated amounts are as follows. The amounts as of September 30, 2018 have been be reclassified to match the current year presentation of segment assets.


	September 30,
(in thousands)	2019		2018
Segment Assets:
GovDeals	$	75,218	$	47,632
CAG	128,918		146,544
RSCG	27,075		19,418
Machinio	26,613		25,916
Corporate & Other, including elimination adjustments	(70,541)		(37,678)
Total Segment Assets:	$	187,283	$	201,832

Revenue attributed to countries that represent a significant portion of consolidated revenues are as follows:


	Year Ended September 30,
(in thousands)	2019		2018		2017
United States	$	191,816	$	193,240	$	240,102
Rest of the world	34,709		31,274		29,913
Consolidated	$	226,525	$	224,514	$	270,015

Total long-lived assets by geographic areas are presented as follows:


	September 30,
(in thousands)	2019		2018
United States	$	18,455	$	16,367
Rest of the world	391		243
Consolidated	$	18,846	$	16,610