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Note 13 - Segment Reporting | 9 Months Ended
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Sep. 30, 2020
Notes to Financial Statements |
Segment Reporting Disclosure [Text Block] | 13. Segment Reporting: (a) We are organized and managed based on two operating segments which are differentiated primarily by their services, the markets they serve and the regulatory environments in which they operate and are described as follows: 1. Network Access Services - This segment derives revenue from the retail sale of mobile phones, retail telephony services, retail high speed Internet access to individuals and small businesses primarily through the Ting website. The segment also derives revenue from MSE services and professional services to wholesale customers. Revenues are generated in the United States. 2. Domain Services – This segment includes wholesale and retail domain name registration services, value added services and portfolio services. The Company primarily earns revenues from the registration fees charged to resellers in connection with new, renewed and transferred domain name registrations; the sale of retail Internet domain name registration and email services to individuals and small businesses; and by making its portfolio of domain names available for sale or lease. Domain Services revenues are attributed to the country in which the contract originates, primarily Canada and the United States. The Chief Executive Officer (the “CEO”) is the chief operating decision maker and regularly reviews the operations and performance by segment. The CEO reviews gross profit as (i) a key measure of performance for each segment and (ii) to make decisions about the allocation of resources. Sales and marketing expenses, technical operations and development expenses, general and administrative expenses, depreciation of property and equipment, amortization of intangibles assets, impairment of indefinite life intangible assets, gain on currency forward contracts and other expense net are organized along functional lines and are not included in the measurement of segment profitability. Total assets and total liabilities are centrally managed and are not reviewed at the segment level by the CEO. The Company follows the same accounting policies for the segments as those described in Notes 2 – Basis of Presentation, 3 – Recent Accounting Pronouncements, and 10 - Revenue. Information by reportable segments (with the exception of disaggregated revenue, which is discussed in Note 10 – Revenue), which is regularly reported to the chief operating decision maker is as follows (Dollar amounts in thousands of US dollars):
|  | Network Access Services |  |  | Domain Services |  |  | Consolidated Totals |
Three Months Ended September 30, 2020 |  |  |  |  |  |  |  |  |  |  |  |
Net Revenues |  | $ | 13,509 |  |  | $ | 60,802 |  |  | $ | 74,311 |
Cost of revenues |  |  |  |  |  |  |  |  |  |  |  |
Cost of revenues |  |  | 6,389 |  |  |  | 41,941 |  |  |  | 48,330 |
Network expenses |  |  | 484 |  |  |  | 2,128 |  |  |  | 2,612 |
Depreciation of property and equipment |  |  | 2,631 |  |  |  | 354 |  |  |  | 2,985 |
Amortization of intangible assets |  |  | 26 |  |  |  | 304 |  |  |  | 330 |
Impairment of Property Plant and Equipment |  |  | 113 |  |  |  | - |  |  |  | 113 |
Total cost of revenues |  |  | 9,643 |  |  |  | 44,727 |  |  |  | 54,370 |
Gross Profit |  |  | 3,866 |  |  |  | 16,075 |  |  |  | 19,941 |
Expenses: |  |  |  |  |  |  |  |  |  |  |  |
Sales and marketing |  |  |  |  |  |  |  |  |  |  | 8,318 |
Technical operations and development |  |  |  |  |  |  |  |  |  |  | 3,162 |
General and administrative |  |  |  |  |  |  |  |  |  |  | 4,868 |
Depreciation of property and equipment |  |  |  |  |  |  |  |  |  |  | 125 |
Amortization of intangible assets |  |  |  |  |  |  |  |  |  |  | 2,315 |
Loss (gain) on currency forward contracts |  |  |  |  |  |  |  |  |  |  | (159 | )
Income from operations |  |  |  |  |  |  |  |  |  |  | 1,312 |
Other income (expenses), net |  |  |  |  |  |  |  |  |  |  | 244 |
Income before provision for income taxes |  |  |  |  |  |  |  |  |  | $ | 1,556 |
|  | Network Access Services |  |  | Domain Services |  |  | Consolidated Totals |
Three Months Ended September 30, 2019 |  |  |  |  |  |  |  |  |  |  |  |
Net Revenues |  | $ | 24,612 |  |  | $ | 63,517 |  |  | $ | 88,129 |
Cost of revenues |  |  |  |  |  |  |  |  |  |  |  |
Cost of revenues |  |  | 12,107 |  |  |  | 43,649 |  |  |  | 55,756 |
Network expenses |  |  | 515 |  |  |  | 1,739 |  |  |  | 2,254 |
Depreciation of property and equipment |  |  | 1,797 |  |  |  | 434 |  |  |  | 2,231 |
Amortization of intangible assets |  |  | 12 |  |  |  | 302 |  |  |  | 314 |
Total cost of revenues |  |  | 14,431 |  |  |  | 46,124 |  |  |  | 60,555 |
Gross Profit |  |  | 10,181 |  |  |  | 17,393 |  |  |  | 27,574 |
Expenses: |  |  |  |  |  |  |  |  |  |  |  |
Sales and marketing |  |  |  |  |  |  |  |  |  |  | 8,769 |
Technical operations and development |  |  |  |  |  |  |  |  |  |  | 2,876 |
General and administrative |  |  |  |  |  |  |  |  |  |  | 4,574 |
Depreciation of property and equipment |  |  |  |  |  |  |  |  |  |  | 117 |
Loss on disposition of property and equipment |  |  |  |  |  |  |  |  |  |  | 73 |
Amortization of intangible assets |  |  |  |  |  |  |  |  |  |  | 2,544 |
Loss (gain) on currency forward contracts |  |  |  |  |  |  |  |  |  |  | 20 |
Income from operations |  |  |  |  |  |  |  |  |  |  | 8,601 |
Other income (expenses), net |  |  |  |  |  |  |  |  |  |  | (1,263 | )
Income before provision for income taxes |  |  |  |  |  |  |  |  |  | $ | 7,338 |
|  | Network Access Services |  |  | Domain Services |  |  | Consolidated Totals |
Nine Months Ended September 30, 2020 |  |  |  |  |  |  |  |  |  |  |  |
Net Revenues |  | $ | 59,946 |  |  | $ | 180,472 |  |  | $ | 240,418 |
Cost of revenues |  |  |  |  |  |  |  |  |  |  |  |
Cost of revenues |  |  | 28,287 |  |  |  | 125,021 |  |  |  | 153,308 |
Network expenses |  |  | 1,627 |  |  |  | 5,886 |  |  |  | 7,513 |
Depreciation of property and equipment |  |  | 7,629 |  |  |  | 1,263 |  |  |  | 8,892 |
Amortization of intangible assets |  |  | 74 |  |  |  | 936 |  |  |  | 1,010 |
Impairment of Property Plant and Equipment |  |  | 1,638 |  |  |  | - |  |  |  | 1,638 |
Total cost of revenues |  |  | 39,255 |  |  |  | 133,106 |  |  |  | 172,361 |
Gross Profit |  |  | 20,691 |  |  |  | 47,366 |  |  |  | 68,057 |
Expenses: |  |  |  |  |  |  |  |  |  |  |  |
Sales and marketing |  |  |  |  |  |  |  |  |  |  | 26,521 |
Technical operations and development |  |  |  |  |  |  |  |  |  |  | 8,980 |
General and administrative |  |  |  |  |  |  |  |  |  |  | 15,074 |
Depreciation of property and equipment |  |  |  |  |  |  |  |  |  |  | 363 |
Amortization of intangible assets |  |  |  |  |  |  |  |  |  |  | 7,766 |
Impairment of definite life intangible assets |  |  |  |  |  |  |  |  |  |  | 1,431 |
Loss (gain) on currency forward contracts |  |  |  |  |  |  |  |  |  |  | (99 | )
Income from operations |  |  |  |  |  |  |  |  |  |  | 8,021 |
Other income (expenses), net |  |  |  |  |  |  |  |  |  |  | (1,924 | )
Income before provision for income taxes |  |  |  |  |  |  |  |  |  | $ | 6,097 |
|  | Network Access Services |  |  | Domain Services |  |  | Consolidated Totals |
Nine Months Ended September 30, 2019 |  |  |  |  |  |  |  |  |  |  |  |
Net Revenues |  | $ | 71,493 |  |  | $ | 179,706 |  |  | $ | 251,199 |
Cost of revenues |  |  |  |  |  |  |  |  |  |  |  |
Cost of revenues |  |  | 35,681 |  |  |  | 126,880 |  |  |  | 162,561 |
Network expenses |  |  | 1,552 |  |  |  | 5,482 |  |  |  | 7,034 |
Depreciation of property and equipment |  |  | 4,907 |  |  |  | 1,163 |  |  |  | 6,070 |
Amortization of intangible assets |  |  | 34 |  |  |  | 768 |  |  |  | 802 |
Total cost of revenues |  |  | 42,174 |  |  |  | 134,293 |  |  |  | 176,467 |
Gross Profit |  |  | 29,319 |  |  |  | 45,413 |  |  |  | 74,732 |
Expenses: |  |  |  |  |  |  |  |  |  |  |  |
Sales and marketing |  |  |  |  |  |  |  |  |  |  | 26,366 |
Technical operations and development |  |  |  |  |  |  |  |  |  |  | 8,151 |
General and administrative |  |  |  |  |  |  |  |  |  |  | 13,818 |
Depreciation of property and equipment |  |  |  |  |  |  |  |  |  |  | 375 |
Loss on disposition of property and equipment |  |  |  |  |  |  |  |  |  |  | 73 |
Amortization of intangible assets |  |  |  |  |  |  |  |  |  |  | 6,661 |
Loss (gain) on currency forward contracts |  |  |  |  |  |  |  |  |  |  | (90 | )
Income from operations |  |  |  |  |  |  |  |  |  |  | 19,378 |
Other income (expenses), net |  |  |  |  |  |  |  |  |  |  | (3,549 | )
Income before provision for income taxes |  |  |  |  |  |  |  |  |  | $ | 15,829 |
(b) The following is a summary of the Company’s property and equipment by geographic region (Dollar amounts in thousands of US dollars):
|  | September 30, 2020 |  |  | December 31, 2019 |
Canada |  | $ | 2,249 |  |  | $ | 2,319 |
United States |  |  | 107,475 |  |  |  | 79,758 |
Europe |  |  | 43 |  |  |  | 44 |
|  | $ | 109,767 |  |  | $ | 82,121 |
(c) The following is a summary of the Company’s amortizable intangible assets by geographic region (Dollar amounts in thousands of US dollars):
|  | September 30, 2020 |  |  | December 31, 2019 |
Canada |  | $ | 2,635 |  |  | $ | 5,207 |
United States |  |  | 35,157 |  |  |  | 40,137 |
|  | $ | 37,792 |  |  | $ | 45,344 |
(d) The following is a summary of the Company’s deferred tax asset, net of valuation allowance, by geographic region (Dollar amounts in thousands of US dollars):
|  | September 30, 2020 |  |  | December 31, 2019 |
Canada |  | $ | - |  |  | $ | - |
|  | $ | - |  |  | $ | - |
(e) Valuation and qualifying accounts (Dollar amounts in thousands of US dollars):
Allowance for doubtful accounts |  | Balance at beginning of period |  |  | Charged to costs and expenses |  |  | Write-offs during period |  |  | Balance at end of period |
Nine Months Ended September 30, 2020 |  | $ | 131 |  |  | $ | 85 |  |  | $ | - |  |  | $ | 216 |
Twelve months ended December 31, 2019 |  | $ | 132 |  |  | $ | (1 | ) |  | $ | - |  |  | $ | 131 |

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- Definition 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. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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