Segment Reporting, Geographic Information, and Concentration of Credit Risk

3 Months Ended

Mar. 31, 2022

Segment Reporting, Geographic Information, and Concentration of Credit Risk

12. Segment Reporting, Geographic Information, and Concentration of Credit Risk

Segment Reporting

ASC 280, Segment Reporting (“ASC 280”) establishes standards for the reporting by public business enterprises of information about operating segments, products and services, geographic areas, and major customers. The method for determining what information to report is based on the way management organizes the operating segments within the Company for making operating decisions and assessing financial performance. An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenue and incur expenses and about which separate financial information is available to its chief operating decision makers (“CODM”). The Company’s CODM is its Chief Executive Officer.

The CODM reviews financial information and business performance for each operating segment. The Company evaluates the performance of its operating segments at the revenue and gross profit levels. The Company does not report total assets, capital expenditures or operating expenses by operating segment as such information is not used by the CODM for purposes of assessing performance or allocating resources.

Net revenue and gross profit information by segment for the three months ended March 31, 2022 and 2021 are as follows (in thousands):

	Three Months Ended March 31,
	2022			2021
Identity:
Net revenue	$	14,579		$	13,658
Gross profit		3,159			3,359
Gross profit margin		22	%		25	%
Premises:
Net revenue		10,482			8,504
Gross profit		5,807			4,333
Gross profit margin		55	%		51	%
Total:
Net revenue		25,061			22,162
Gross profit		8,966			7,692
Gross profit margin		36	%		35	%
Operating expenses:
Research and development		2,529			2,337
Selling and marketing		5,110			4,064
General and administrative		2,488			2,125
Restructuring and severance		(140	)		388
Total operating expenses:		9,987			8,914
Loss from operations		(1,021	)		(1,222	)
Non-operating income (expense):
Interest expense, net		(25	)		(245	)
Gain on investment		24			—
Foreign currency gains, net		19			46
Loss before income tax benefit (provision)	$	(1,003	)	$	(1,421	)

Geographic Information

Geographic net revenue is based on the customer’s ship-to location. Information regarding net revenue by geographic region for the three months ended March 31, 2022 and 2021 is as follows (in thousands):

	Three Months Ended March 31,
	2022			2021
Americas	$	16,891		$	15,148
Europe and the Middle East		3,794			2,460
Asia-Pacific		4,376			4,554
Total	$	25,061		$	22,162

As percentage of net revenue:
Americas		67	%		68	%
Europe and the Middle East		15	%		11	%
Asia-Pacific		18	%		21	%
Total		100	%		100	%

Concentration of Credit Risk

No customer accounted for 10% or more of net revenue for either of the three months ended March 31, 2022 or 2021. No customer accounted for 10% or more of net accounts receivable as of March 31, 2022 or December 31, 2021.

Long-lived assets by geographic location as of March 31, 2022 and December 31, 2021 are as follows (in thousands):

	March 31,		December 31,
	2022		2021
Property and equipment, net:
Americas	$	521	$	545
Europe and the Middle East		348		334
Asia-Pacific		3,472		3,187
Total property and equipment, net	$	4,341	$	4,066

Operating lease ROU assets:
Americas	$	1,186	$	1,344
Europe and the Middle East		106		135
Asia-Pacific		488		609
Total operating lease right-of-use assets	$	1,780	$	2,088