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NOTE 7 — Segment Information and Concentrations
 3 Months Ended
Mar. 31, 2023
Segment Reporting [Abstract]  
NOTE 7 — Segment Information and Concentrations

NOTE 7 — 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 or NFC 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 the Company’s products.

 

Revenues by geographic areas for the three months ended March 31, 2023 and 2022 were as follows:

 

                
   Three Months Ended March 31,
Revenues:  2023  2022
   United States   $3,138,653   $4,882,773 
   Europe    542,527    697,971 
   Asia and rest of world    630,998    712,258 
      Total revenues   $4,312,178   $6,293,002 
           

 

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, 2023 and 2022 were as follows:

 

                
   Three Months Ended March 31,
   2023  2022
Ingram Micro, Inc.    23%   27%
BlueStar, Inc.    20%   20%
ScanSource, Inc.    *    19%
     
*Customer accounted for less than 10% of the Company’s total revenue          
           

 

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 and the Company has not experienced losses on the investments. The Company’s trade accounts receivables 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 on March 31, 2023 and December 31, 2022 were as follows:

 

 

 

SOCKET MOBILE, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

(Unaudited)

March 31, 2023

 

 

 

       
   March 31,  December 31,
   2023  2022
Ingram Micro Inc.      28%   14%
BlueStar, Inc.      27%   46%
ScanSource, Inc.      15%   11%
Nippon Primex, Inc.    *    14%
           
*Customer accounted for less than 10% of the Company’s 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 due to an interruption of supply. Suppliers may choose to restrict credit terms or require advance payments causing delays in the procurement of essential materials. The Company’s inability to procure certain materials could have a material adverse effect on the Company’s results. For the three months ended March 31, 2023 and 2022, the top three suppliers accounted for 55% and 53%, respectively, of inventory purchases. As of March 31, 2023 and December 31, 2022, 26% and 31%, respectively, of the Company’s accounts payable balances were concentrated with top two suppliers.