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Business Segments and Geographic Information
 9 Months Ended
Sep. 30, 2022
Segment Reporting [Abstract]  
Business Segments and Geographic Information
15.
Business Segments and Geographic Information
Our reporting
segments are:
1)
Data and Analytics Services; and
2)
IT Staffing Services.
The Data and Analytics Services segment was acquired through the July 13, 2017 acquisition of the services division of Canada-based InfoTrellis, Inc. This segment is a project-based consulting services business with specialized capabilities in data management and analytics. The business is marketed as Mastech InfoTrellis and utilizes a dedicated sales team with deep subject matter expertise. Mastech InfoTrellis has offices in Atlanta, Toronto and London, and a global delivery center in Chennai, India. Project-based delivery reflects a combination of
on-site
resources and offshore resources. Assignments are secured on both a time and material and fixed price basis. In October 2020, we acquired AmberLeaf, a Chicago-based customer experience consulting firm. This acquisition expanded our capabilities in customer experience strategy and managed services offering for a variety of Cloud-based enterprise application across sales, marketing and customer service organizations.
The IT Staffing Services segment offers staffing services in digital and mainstream technologies and uses digital methods to enhance organizational learning. These services are marketed using a common sales force and delivered via our domestic and global recruitment centers. While the vast majority of our assignments are based on time and materials, we do have the capabilities to deliver our digital transformation services on a fixed price basis.
 
 
  
Three Months Ended

September 30,
 
 
Nine Months Ended

September 30,
 
 
  
2022
 
 
2021
 
 
2022
 
 
2021
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
  
(Amounts in thousands)
 
 
(Amounts in thousands)
 
Revenues:
  
      
 
      
 
      
 
      
Data and analytics services
    $ 10,076     $ 10,523     $ 31,478     $ 28,267  
IT staffing services
      53,074       49,008       153,544       134,697  
    
 
 
    
 
 
    
 
 
    
 
 
  
Total revenues
    $ 63,150     $ 59,531     $ 185,022     $ 162,964  
    
 
 
    
 
 
    
 
 
    
 
 
  
Gross Margin %:
                                 
Data and analytics services
      39.6 %      51.6 %      42.8 %      48.2 % 
IT staffing services
      23.2 %      22.8 %      23.1 %      22.4 % 
    
 
 
    
 
 
    
 
 
    
 
 
  
Total gross margin %
      25.8 %      27.9 %      26.5 %      26.8 % 
    
 
 
    
 
 
    
 
 
    
 
 
  
Segment operating income:
                                 
Data and analytics services
    $ 826     $ 1,851     $ 2,615     $ 3,014  
IT staffing services
      3,892       3,916       10,542       9,537  
    
 
 
    
 
 
    
 
 
    
 
 
  
Subtotal
      4,718       5,767       13,157       12,551  
Amortization of acquired intangible assets
      (791 )      (792 )      (2,375 )      (2,378 ) 
Revaluation of contingent consideration liability
      —         —         —         1,982  
Reserve for cyber-security bre
a
ch
      (450 )      —         (450 )      —    
Severance expense
      (120 )      —         (120 )      —    
Interest expenses and other, net
      —         (235 )      8       (611 ) 
    
 
 
    
 
 
    
 
 
    
 
 
  
Income before income taxes
    $ 3,357     $ 4,740     $ 10,220     $ 11,544  
    
 
 
    
 
 
    
 
 
    
 
 
  
Below is a reconciliation of segment total assets to consolidated total assets:
 
    
September 30,

2022
     
December 31,

2021
  
               
    
(Amounts in thousands)
  
Total assets:
                  
Data and Analytics Services
    $ 56,644      $ 56,634  
IT Staffing Services
      58,132        57,068  
    
 
 
     
 
 
  
Total assets
    $ 114,776      $ 113,702  
    
 
 
     
 
 
  
Below is geographic information related to our revenues from external customers:
 
    
Three Months Ended

September 30,
     
Nine Months Ended

September 30,
  
    
2022
     
2021
     
2022
     
2021
  
                             
    
(Amounts in thousands)
     
(Amounts in thousands)
  
United States
    $ 61,704      $ 57,682      $ 180,519      $ 157,156  
Canada
      1,038        988        3,187        3,270  
India and Other
      408        861        1,316        2,538  
    
 
 
     
 
 
     
 
 
     
 
 
  
Total revenues
    $ 63,150      $ 59,531      $ 185,022      $ 162,964