Segments and Geographical Information

12 Months Ended

Dec. 31, 2012

Segment Reporting [Abstract]

Segments and Geographical Information

Segments and Geographical Information

Segment Information

Operating segments are defined as components of an enterprise for which separate financial information is available that is evaluated regularly by the Chief Operating Decision Maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. Our CODM is our Chief Executive Officer. We report segment information based on the management approach. The management approach designates the internal reporting used by CODM for decision making and performance assessment as the basis for determining our reportable segments. The performance measures of our reportable segments include net revenues and gross profit.

We have grouped our operations into two reportable segments which are also our reporting units: Clear Aligner segment and SCCS segment.

• Our Clear Aligner segment consists of our Invisalign system which includes Invisalign Full, Express/Lite, Teen, Assist, Vivera retainers, along with our training and ancillary products for treating malocclusion.

• Our SCCS segment consists of intra-oral scanning systems and additional services available with the intra-oral scanners that provide digital alternatives to the traditional cast models. This segment includes our iTero scanner and OrthoCAD services.

These reportable operating segments are based on how our CODM views and evaluates our operations as well as allocation of resources (in thousands):

	For the Years Ended December 31,
Revenue	2012		2011		2010
Clear Aligner
Invisalign Full	$	338,600	$	302,391	$	264,750
Invisalign Express/Lite	51,486		42,509		34,632
Invisalign Teen	67,127		54,529		52,837
Invisalign Assist	28,705		27,527		14,736
Invisalign non-case revenues	30,663		24,757		20,171
Scanners and CAD/CAM Services (1)
Scanners	20,059		13,383		—
CAD/CAM Services	23,401		14,645		—
Total	$	560,041	$	479,741	$	387,126
Gross profit
Clear Aligner	$	405,970	$	354,700	$	303,417
Scanners and CAD/CAM Services (1)	10,418		6,583		—
Total	$	416,388	$	361,283	$	303,417

(1) Our Scanners and CAD/CAM Services reportable operating segment was the result of our acquisition of Cadent on April 29, 2011.

Geographical Information

Net revenues and long-lived assets are presented below by geographic area (in thousands):

	For the Years Ended December 31,
	2012		2011		2010
Net revenues (1):
United States	$	427,929	$	359,936	$	290,847
the Netherlands	121,826		109,831		92,032
Other international	10,286		9,974		4,247
Total net revenues	$	560,041	$	479,741	$	387,126

	As of December 31,
	2012		2011		2010
Long-lived assets:
United States	$	62,543	$	45,720	$	31,381
Mexico	6,473		4,673		262
the Netherlands	5,335		1,726		837
Other international	8,294		4,588		1,657
Total long-lived assets	$	82,645	$	56,707	$	34,137

__________

(1) Revenues are attributed to countries based on location of where revenue is recognized.