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Segment Reporting
6 Months Ended
Jun. 30, 2017
Segment Reporting [Abstract]  
Segment Reporting
Segment Reporting

The financial results of each segment are based on revenues from external customers, cost of revenue and operating expenses that are directly attributable to the segment and an allocation of costs from shared functions. These shared functions include, but are not limited to, facilities, human resources, information technology, and engineering. Allocations are made based on management’s judgment of the most relevant factors, such as head count, number of customer sites, or other operational data that contribute to the shared costs. Certain corporate-level costs have not been allocated as they are not directly attributable to either segment. These costs primarily consist of broad corporate functions, including executive, legal, finance, and costs associated with corporate actions. Segment-level asset information has not been provided as such information is not reviewed by the chief operating decision-maker for purposes of assessing segment performance and allocating resources. There are no inter-segment sales or transactions.

The Company's performance is impacted by the levels of activity in the marine and land mobile markets and defense sectors, among others. Performance in any particular period could be impacted by the timing of sales to certain large customers.

The mobile connectivity segment primarily manufactures and distributes a comprehensive family of mobile satellite antenna products and services that provide access to television, the Internet and voice services while on the move. Product sales within the mobile connectivity segment accounted for 22% and 25% of consolidated net sales for the three months ended June 30, 2017 and 2016, respectively, and 23% and 26% of consolidated net sales for the six months ended June 30, 2017 and 2016, respectively. Sales of mini-VSAT Broadband airtime service accounted for 41% and 35% of consolidated net sales for the three months ended June 30, 2017 and 2016, respectively, and 40% and 35% of consolidated net sales for the six months ended June 30, 2017 and 2016, respectively. Sales of content and training services within the mobile connectivity segment accounted for 20% and 19% of consolidated net sales for the three months ended June 30, 2017 and 2016, respectively, and 20% and 20% of consolidated net sales for the six months ended June 30, 2017 and 2016, respectively.
The inertial navigation segment manufactures and distributes a portfolio of digital compass and fiber optic gyro (FOG)-based systems that address the rigorous requirements of military and commercial customers and provide reliable, easy-to-use and continuously available navigation and pointing data.  The principal product categories in this segment include the FOG-based inertial measurement units (IMUs) for precision guidance, FOGs for tactical navigation as well as pointing and stabilization systems, and digital compasses that provide accurate heading information for demanding applications, security, automation and access control equipment and systems. Sales of FOG-based guidance and navigation systems within the inertial navigation segment accounted for 12% and 9% of the consolidated net sales for the three months ended June 30, 2017 and 2016, respectively, and 11% and 10% of the consolidated net sales for the six months ended June 30, 2017 and 2016, respectively.

No other single product class accounts for 10% or more of consolidated net sales.

The Company operates in a number of major geographic areas across the globe. The Company generates international net sales, based upon customer location, primarily from customers located in Canada, Europe, Africa, Asia/Pacific, the Middle East, and India. International revenues represented 62% and 63% of consolidated net sales for the three months ended June 30, 2017 and 2016, respectively, and 61% and 63% of consolidated net sales for the six months ended June 30, 2017 and 2016, respectively. Sales to Canada represented 13% of consolidated net sales for the three months ended June 30, 2016. No other individual foreign country represented 10% or more of the Company's consolidated net sales for the three months ended June 30, 2017 and 2016. No individual foreign country represented 10% or more of consolidated net sales for the six months ended June 30, 2017 and 2016.

As of June 30, 2017 and December 31, 2016, the long-lived tangible assets related to the Company’s international subsidiaries were less than 10% of the Company’s long-lived tangible assets and were deemed not material.

Net sales and operating earnings (loss) for the Company's reporting segments and the Company's loss before income tax expense (benefit) for the three and six months ended June 30, 2017 and 2016 were as follows:

 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2017
 
2016
 
2017
 
2016
Net sales:
 
 
 
 
 
 
 
Mobile connectivity
$
34,034

 
$
36,890

 
$
68,321

 
$
72,155

Inertial navigation
6,415

 
9,076

 
12,339

 
14,191

Consolidated net sales
$
40,449

 
$
45,966

 
$
80,660

 
$
86,346

 
 
 
 
 
 
 
 
Operating earnings (loss):
 
 
 
 
 
 
 
Mobile connectivity
$
2,638

 
$
1,631

 
$
3,260

 
$
3,621

Inertial navigation
362

 
1,596

 
318

 
669

Subtotal
3,000

 
3,227

 
3,578

 
4,290

Unallocated, net
(4,368
)
 
(3,920
)
 
(9,416
)
 
(8,357
)
Loss from operations
(1,368
)
 
(693
)
 
(5,838
)
 
(4,067
)
Net interest and other (expense) income
(302
)
 
(91
)
 
(557
)
 
(438
)
Loss before income tax expense (benefit)
$
(1,670
)
 
$
(784
)
 
$
(6,395
)
 
$
(4,505
)
Depreciation expense and amortization expense for the Company's segments are presented in the following table for the periods presented:
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2017
 
2016
 
2017
 
2016
Depreciation expense:
 
 
 
 
 
 
 
Mobile connectivity
$
1,394

 
$
1,567

 
$
2,872

 
$
3,226

Inertial navigation
199

 
224

 
395

 
448

Unallocated
21

 
24

 
40

 
48

Total consolidated depreciation expense
$
1,614

 
$
1,815

 
$
3,307

 
$
3,722

 
 
 
 
 
 
 
 
Amortization expense:
 
 
 
 
 
 
 
Mobile connectivity
$
1,102

 
$
1,250

 
$
2,170

 
$
2,533

Inertial navigation

 

 

 

Unallocated

 

 

 

Total consolidated amortization expense
$
1,102

 
$
1,250

 
$
2,170

 
$
2,533