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SEGMENT INFORMATION | 6 Months Ended
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Jun. 30, 2019
SEGMENT INFORMATION [ABSTRACT] |
SEGMENT INFORMATION | (3)SEGMENT INFORMATION During the second quarter of 2019, the Company finalized changes to the Company’s operating strategy and the way in which the Company assesses performance. In accordance with this change, the Company adjusted certain reporting relationships between the Chief Operating Decision Maker (“CODM”) and other members of management, updated the compensation metrics for senior management, and modified the internal financial reporting provided to the CODM and his direct reports consistent with this revised management and measurement structure. Accordingly, during the second quarter of 2019, the Company reevaluated the definition of the operating segments, reportable segments, and reporting units which resulted in a change to the reportable segments. Effective June 30, 2019, the segment information will be reported consistent with these updated reportable segments comprised of TTEC Digital and TTEC Engage. The Company reports the following two segments:
| · |  | TTEC Digital designs, builds and delivers tech-enabled, insight-based and outcome-driven customer experience solutions through our professional services and suite of technology offerings. These solutions are critical to enabling and accelerating digital transformation for our clients.
| o |  | Professional Services: Our management consulting practices deliver customer experience strategy, analytics, process optimization, and learning and performance services.
| o |  | Technology Services: Our technology services design, integrate and operate highly scalable, digital omnichannel technology solutions in the cloud, on premise, or hybrid, including journey orchestration, automation and AI, knowledge management, and workforce productivity.
| · |  | TTEC Engage provides the essential technologies, human resources, infrastructure and processes to operate customer care, acquisition, and fraud detection and prevention services.
| o |  | Customer Care Services: Our customer care services provide turnkey contact center solutions, including digital omnichannel technologies, associate recruiting and training, facilities, and operational expertise to create exceptional customer experiences across all touchpoints.
| o |  | Customer Acquisition Services: Our customer growth and acquisition services optimize the buying journeys for acquiring new customers by leveraging technology and analytics to deliver personal experiences to increase the quantity and quality of leads and customers.
| o |  | Fraud Prevention Services: Our digital fraud detection and prevention services provide the ability to proactively identify and prevent fraud, and ensure community content moderation and compliance.
The Company allocates to each segment its portion of corporate operating expenses. All intercompany transactions between the reported segments for the periods presented have been eliminated. The following tables present certain financial data by segment (in thousands): Three Months Ended June 30, 2019
|  |  |  |  |  |  |  |  |  |  | Depreciation |  | Income |
|  | Gross |  | Intersegment |  | Net |  | & |  | from |
|  | Revenue |  | Sales |  | Revenue |  | Amortization |  | Operations |
TTEC Digital |  | $ | 78,580 |  | $ | (61) |  | $ | 78,519 |  | $ | 3,235 |  | $ | 7,709 |
TTEC Engage |  |  | 313,996 |  |  | — |  |  | 313,996 |  |  | 13,815 |  |  | 15,164 |
Total |  | $ | 392,576 |  | $ | (61) |  | $ | 392,515 |  | $ | 17,050 |  | $ | 22,873 |
Three Months Ended June 30, 2018
|  |  |  |  |  |  |  |  |  |  | Depreciation |  | Income |
|  | Gross |  | Intersegment |  | Net |  | & |  | from |
|  | Revenue |  | Sales |  | Revenue |  | Amortization |  | Operations |
TTEC Digital |  | $ | 52,619 |  | $ | (119) |  | $ | 52,500 |  | $ | 2,082 |  | $ | 6,764 |
TTEC Engage |  |  | 297,353 |  |  | — |  |  | 297,353 |  |  | 14,729 |  |  | 6,739 |
Total |  | $ | 349,972 |  | $ | (119) |  | $ | 349,853 |  | $ | 16,811 |  | $ | 13,503 |
Six Months Ended June 30, 2019
|  |  |  |  |  |  |  |  |  |  | Depreciation |  | Income |
|  | Gross |  | Intersegment |  | Net |  | & |  | from |
|  | Revenue |  | Sales |  | Revenue |  | Amortization |  | Operations |
TTEC Digital |  | $ | 144,621 |  | $ | (249) |  | $ | 144,372 |  | $ | 5,543 |  | $ | 15,468 |
TTEC Engage |  |  | 642,499 |  |  | — |  |  | 642,499 |  |  | 28,250 |  |  | 39,497 |
Total |  | $ | 787,120 |  | $ | (249) |  | $ | 786,871 |  | $ | 33,793 |  | $ | 54,965 |
Six Months Ended June 30, 2018
|  |  |  |  |  |  |  |  |  |  | Depreciation |  | Income |
|  | Gross |  | Intersegment |  | Net |  | & |  | from |
|  | Revenue |  | Sales |  | Revenue |  | Amortization |  | Operations |
TTEC Digital |  | $ | 102,687 |  | $ | (119) |  | $ | 102,568 |  | $ | 4,234 |  | $ | 12,110 |
TTEC Engage |  |  | 622,534 |  |  | — |  |  | 622,534 |  |  | 30,501 |  |  | 26,334 |
Total |  | $ | 725,221 |  | $ | (119) |  | $ | 725,102 |  | $ | 34,735 |  | $ | 38,444 |
|  | Three Months Ended |  | Six Months Ended |
|  | June 30, |  | June 30, |
|  | 2019 |  | 2018 |  | 2019 |  | 2018 |
Capital Expenditures |  |  |  |  |  |  |  |  |  |  |  |  |
TTEC Digital |  | $ | 5,655 |  | $ | 1,187 |  | $ | 9,396 |  | $ | 1,342 |
TTEC Engage |  |  | 9,573 |  |  | 8,188 |  |  | 19,032 |  |  | 15,541 |
Total |  | $ | 15,228 |  | $ | 9,375 |  | $ | 28,428 |  | $ | 16,883 |
|  |  | June 30, 2019 |  | December 31, 2018 |
Total Assets |  |  |  |  |  |  |  |
TTEC Digital |  |  | $ | 249,291 |  | $ | 222,977 |
TTEC Engage |  |  |  | 930,050 |  |  | 831,531 |
Total |  |  | $ | 1,179,341 |  | $ | 1,054,508 |
|  |  | June 30, 2019 |  | December 31, 2018 |
Goodwill |  |  |  |  |  |  |  |
TTEC Digital |  |  | $ | 66,155 |  | $ | 66,158 |
TTEC Engage |  |  |  | 139,603 |  |  | 138,475 |
Total |  |  | $ | 205,758 |  | $ | 204,633 |
The following table presents revenue based upon the geographic location where the services are provided (in thousands):
|  | Three Months Ended June 30, |  | Six Months Ended June 30, |
|  | 2019 |  | 2018 |  | 2019 |  | 2018 |
Revenue |  |  |  |  |  |  |  |  |  |  |  |  |
United States |  | $ | 235,733 |  | $ | 188,744 |  | $ | 472,700 |  | $ | 398,592 |
Philippines |  |  | 91,401 |  |  | 85,442 |  |  | 184,580 |  |  | 174,647 |
Latin America |  |  | 25,054 |  |  | 27,224 |  |  | 49,190 |  |  | 57,722 |
Europe / Middle East / Africa |  |  | 15,610 |  |  | 18,469 |  |  | 31,651 |  |  | 34,440 |
Asia Pacific / India |  |  | 14,155 |  |  | 14,139 |  |  | 26,980 |  |  | 27,576 |
Canada |  |  | 10,562 |  |  | 15,835 |  |  | 21,770 |  |  | 32,125 |
Total |  | $ | 392,515 |  | $ | 349,853 |  | $ | 786,871 |  | $ | 725,102 |

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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