SEGMENT REPORTING

12 Months Ended

Dec. 31, 2024

Segment Reporting [Abstract]

SEGMENT REPORTING

. SEGMENT REPORTING

The Company has one reportable and operating segment, and operates in two principal geographic locations, Canada and the United States. Revenue continues to be derived almost exclusively from projects in North America and predominantly from the United States. The Company’s revenue from operations from external customers, based on location of operations, and information about its non-current assets, is detailed below.

Revenue from external customers

	For the Year Ended December 31,
	2024		2023		2022
Canada		23,921		19,934		25,477
U.S.		150,392		161,997		146,684
		174,313		181,931		172,161

Non-current assets

	As at December 31,
	2024		2023
Canada		25,924		30,033
U.S.		25,137		30,759
		51,061		60,792

DIRTT has one reportable segment: solutions. The DIRTT solutions segment derives revenues from customers by providing physical products and digital tools through our ICE software to create interior spaces for our customers across the commercial, healthcare, education and government industries. The solutions segment provides digital tools (access to ICE software) and physical products to create modular interior construction spaces for our customers. The accounting policies of the solutions segment are the same as those described in Note 2 – significant accounting policies.

DIRTT’s chief operating decision maker is the executive leadership team that includes the president and chief operating officer, chief financial officer, and the chief executive officer. The chief operating decision maker assesses performance for the solution segment and decides how to allocate resources based on gross profit and net loss that also is reported on the consolidated statement of operations and comprehensive income (loss) as consolidated gross profit and net income (loss). The measure of segment assets is reported on the balance sheet as total consolidated assets. The chief operating decision maker uses net income to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into the solution segment or into other parts of the entity, such as to repay long term debt.

Gross profit and net income (loss) are used to monitor budget versus actual results. The chief operating decision maker also uses net income in competitive analysis by benchmarking to DIRTT’s competitors. The competitive analysis along with the monitoring of budgeted versus actual results are used in assessing performance of the segment and in establishing management’s compensation.

DIRTT derives revenue primarily in North America and manages the business activities on a consolidated basis. The technology used in the customer arrangements is based on a single software platform that is deployed to, and implemented by, customers in a similar manner.

Segment profit and loss reconciliation to net income (loss) after tax

	For the Year Ended December 31,
	2024		2023			2022
	($ in thousands)
Revenue		174,313		181,931			172,161
Operating expenses (1)		60,149		76,097			87,203
Operating income (loss)		4,226		(16,555	)		(59,043	)
Other income/(expenses) and gains/(losses) (2)		10,544		1,971			4,080
Net income (loss) after tax		14,770		(14,584	)		(54,963	)
Reconciliation of profit or loss
Adjustments and reconciling items		-		-			-
Net income (loss) after tax		14,770		(14,584	)		(54,963	)
(1) Includes Sales and marketing, General and administrative, Operations support, Technology and development, Stock-based compensation, Reorganization costs, Related party expenses, and Impairment charges
(2) Includes Tax expenses, non-recurring gains and losses, government subsidies, foreign exchange gains(losses), interest income, and interest expenses