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Note 6 - Segment Information and Concentrations

3 Months Ended

Mar. 31, 2018

NOTE 6 — Segment Information and Concentrations

Segment Information

The Company operates in the mobile barcode scanning and RFID/NFC data capture market. Mobile scanning typically consists of mobile devices such as smartphones or tablets, with mobile scanning peripherals for data collection, and third-party vertical applications software. The Company distributes its products in the United States and foreign countries primarily through distributors and resellers. The Company markets its products primarily through application developers whose applications are designed to work with Company’s products. Revenues for the geographic areas for three months ended March 31, 2018 and 2017 were as follows:

	Three Months Ended March 31,
Revenues:	2018		2017
United States	$	3,004,970	$	4,341,648
Europe		643,749		1,099,682
Asia and rest of world		332,336		180,763
Total revenues	$	3,981,055	$	5,622,093

Export revenues are attributable to countries based on the location of the Company’s customers. The Company does not hold long-lived assets in foreign locations.

Major Customers

Customers who accounted for at least 10% of the Company’s total revenues for the three months ended March 31, 2018 and 2017 were as follows:

	Three Months Ended March 31,
	2018			2017
Ingram Micro, Inc.		32	%		45	%
BlueStar, Inc.		23	%		15	%
ScanSource, Inc.		*			14	%
ScanSource Europe SPRL		*			11	%

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* Customer accounted for less than 10% of total revenues for the period

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk include cash, cash equivalents and accounts receivable. The Company invests its cash in demand deposit accounts in banks. To date, the Company has not experienced losses on the investments. The Company’s trade accounts receivable are primarily with distributors. The Company performs ongoing credit evaluations of its customers’ financial condition but the Company generally requires no collateral. Reserves are maintained for potential credit losses, and such losses have been within management’s expectations. Customers who accounted for at least 10% of the Company’s accounts receivable balances at March 31, 2018 and December 31, 2017 were as follows:

	March 31,			December 31,
	2018			2017
Ingram Micro Inc.		40	%		37	%
BlueStar, Inc.		31	%		23	%
ScanSource, Inc.		*			10	%
Ingram Micro Pan Europe GmbH		*			10	%

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*Customer accounts for less than 10% of accounts receivable balances

Concentration of Suppliers Several of the Company’s component parts are produced by a sole or limited number of suppliers. Shortages could occur in these essential materials due to increased demand, or to an interruption of supply. Suppliers may choose to restrict credit terms or require advance payments causing delays in the procurement of essential materials. If the Company were unable to procure certain of such materials, it could have a material adverse effect upon its results. For the three months ended March 31, 2018 and 2017, top two suppliers accounted for 44% and 60%, respectively, of the inventory purchases.