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Segment Information and Major Customers
12 Months Ended
Dec. 31, 2018
Segment Reporting [Abstract]  
Segment Information and Major Customers

Note 14 – Segment Information and Major Customers

Our chief operating decision maker regularly reviews our financial performance based on two reportable segments – Network Solutions and Services & Support. Network Solutions includes software and hardware products and next-generation virtualized solutions used in service provider or business networks, as well as prior-generation products. Services & Support includes our suite of ProCloud managed services, network installation, engineering and maintenance services, and fee-based technical support and equipment repair/replacement plans.

We evaluate the performance of our segments based on gross profit. Selling, general, and administrative expenses, research and development expenses, interest and dividend income, interest expense, net investment gain (loss), other income (expense) and provision (benefit) for taxes are reported on a company-wide, functional basis only. There are no inter-segment revenues.

The following table presents information about the reported sales and gross profit of our reportable segments for each of the years ended December 31, 2018, 2017 and 2016. Asset information by reportable segment is not reported, since we do not produce such information internally.

 

 

 

2018

 

 

2017

 

 

2016

 

(In thousands)

 

Sales

 

 

Gross Profit

 

 

Sales

 

 

Gross Profit

 

 

Sales

 

 

Gross Profit

 

Network Solutions

 

$

458,232

 

 

$

179,303

 

 

$

540,396

 

 

$

260,833

 

 

$

525,502

 

 

$

254,797

 

Services & Support

 

 

71,045

 

 

 

24,262

 

 

 

126,504

 

 

 

42,802

 

 

 

111,279

 

 

 

36,533

 

Total

 

$

529,277

 

 

$

203,565

 

 

$

666,900

 

 

$

303,635

 

 

$

636,781

 

 

$

291,330

 

 

Sales by Category

In addition to the above reporting segments, we also report revenue for the following three categories – Access & Aggregation, Subscriber Solutions & Experience, and Traditional & Other Products.

The following tables disaggregates our revenue by major source for the years ended December 31, 2018, 2017 and 2016:

 

 

 

2018

 

(In thousands)

 

Network Solutions

 

 

Services & Support

 

 

Total

 

Access & Aggregation

 

$

301,801

 

 

$

57,069

 

 

$

358,870

 

Subscriber Solutions & Experience (1)

 

 

129,067

 

 

 

5,393

 

 

 

134,460

 

Traditional & Other Products

 

 

27,364

 

 

 

8,583

 

 

 

35,947

 

Total

 

$

458,232

 

 

$

71,045

 

 

$

529,277

 

 

 

 

2017

 

(In thousands)

 

Network Solutions

 

 

Services & Support

 

 

Total

 

Access & Aggregation

 

$

361,955

 

 

$

111,989

 

 

$

473,944

 

Subscriber Solutions & Experience (1)

 

 

132,294

 

 

 

6,162

 

 

 

138,456

 

Traditional & Other Products

 

 

46,147

 

 

 

8,353

 

 

 

54,500

 

Total

 

$

540,396

 

 

$

126,504

 

 

$

666,900

 

 

 

 

2016

 

(In thousands)

 

Network Solutions

 

 

Services & Support

 

 

Total

 

Access & Aggregation

 

$

339,451

 

 

$

96,921

 

 

$

436,372

 

Subscriber Solutions & Experience (1)

 

 

130,645

 

 

 

6,963

 

 

 

137,608

 

Traditional & Other Products

 

 

55,406

 

 

 

7,395

 

 

 

62,801

 

Total

 

$

525,502

 

 

$

111,279

 

 

$

636,781

 

 

 

(1)

Subscriber Solutions & Experience was formerly reported as Customer Devices. With the increasing focus on enhancing the customer experience for both our business and consumer broadband customers and the addition of SmartRG during the fourth quarter of 2018, Subscriber Solutions & Experience more accurately represents this revenue category.

 

The following table presents sales information by geographic area for the years ended December 31, 2018, 2017 and 2016:

 

(In thousands)

 

2018

 

 

2017

 

 

2016

 

United States

 

$

288,843

 

 

$

508,178

 

 

$

501,337

 

Germany

 

 

167,251

 

 

 

119,502

 

 

 

85,780

 

Other international

 

 

73,183

 

 

 

39,220

 

 

 

49,664

 

Total

 

$

529,277

 

 

$

666,900

 

 

$

636,781

 

 

Customers comprising more than 10% of revenue can change from year to year. Single customers comprising more than 10% of our revenue in 2018 included two customers at 27% and 17%. Single customers comprising more than 10% of our revenue in 2017 included two customers at 40% and 16%. Single customers comprising more than 10% of our revenue in 2016 included three customers at 24%, 19% and 12%. Other than those with more than 10 percent of revenues disclosed above, and excluding distributors, our next five largest customers can change from year-to-year. These customers represented 18%, 15% and 13% of total revenue in 2018, 2017 and 2016, respectively.

Additional Segment Information

 

As of December 31, 2018, long-lived assets, net totaled $80.6 million, which includes $77.3 million held in the U.S. and $3.3 million held outside the U.S. As of December 31, 2017, long-lived assets, net totaled $85.1 million, which includes $80.6 million held in the U.S. and $4.5 million held outside the U.S.