Information about Geographic Areas and Operating Segments

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

Information about Geographic Areas and Operating Segments

9. Information about Geographic Areas and Operating Segments

Our chief operating decision-makers (i.e. our Chief Executive Officer and certain direct reports) review financial information presented on a consolidated basis, accompanied by disaggregated information for purposes of allocating resources and evaluating financial performance. There are no segment managers who are held accountable by our chief operating decision-makers, or anyone else, for operations, operating results, or planning for levels or components below the consolidated unit level. We operate within a single industry segment of computer software and services.

Effective as of July 1, 2019, we made the following changes to our operating segments:

• Our Third-Party Software operating segment has been renamed to Partner Solutions;

• Our Professional Engineering Service operating segment has been renamed to Edge to Cloud; and

• We no longer present separate information for the Proprietary Software operating segment. Results are no longer quantifiably significant, nor does management view the segment as of continuing significance after deciding to stop marketing of DataV^TM as an IoT platform in the second quarter of 2019. Results for the Proprietary Software segment will be combined with the Edge to Cloud segment as part of continuing operations, with prior period segment results recast to reflect our reporting segments on a comparable basis.

As of July 1, 2019, we have two major product lines – Partner Solutions and Edge to Cloud– each of which we consider to be operating and reportable segments. We do not allocate costs other than direct cost of goods sold to the segments or produce segment income statements, and we do not produce asset information by reportable segment. The following table sets forth profit and loss information about our segments (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Partner Solutions:
Revenue	$	12,556		$	14,241		$	37,341		$	47,297
Cost of revenue		10,762			12,003			31,834			39,837
Gross profit		1,794			2,238			5,507			7,460
Edge to Cloud:
Revenue		2,085			2,453			6,576			9,278
Cost of revenue		1,247			1,332			4,637			4,918
Gross profit		838			1,121			1,939			4,360
Total gross profit		2,632			3,359			7,446			11,820
Operating expenses		3,761			5,491			15,383			20,148
Other income, net		22			65			116			156
Income tax (expense) benefit		—			(20	)		—			(32	)
Net loss	$	(1,107	)	$	(2,087	)	$	(7,821	)	$	(8,204	)

Revenue by geography is based on the sales region of the customer. The following tables set forth total revenue and long-lived assets by geographic area (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Total revenue:
North America	$	12,714	$	15,441	$	39,281	$	52,909
Asia		1,586		579		3,136		1,164
Europe		341		674		1,500		2,502
Total revenue	$	14,641	$	16,694	$	43,917	$	56,575

	September 30, 2019		December 31, 2018
Long-lived assets:
North America	$	1,027	$	1,578
Asia		200		91
Europe		380		4,023
Total long-lived assets	$	1,607	$	5,692