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Segment and Other Information
 9 Months Ended
May 27, 2022
Segment Reporting [Abstract]  
Segment and Other Information
Segment and Other Information
Segment information presented below is consistent with how our chief operating decision maker evaluates operating results to make decisions about allocating resources and assessing performance.
In the fourth quarter of 2021, we reorganized SGH into three business units: Memory Solutions, Intelligent Platforms Solutions and LED Solutions. Two of our previous segments, specialty memory products and Brazil products, were combined to become Memory Solutions. Intelligent Platform Solutions was formerly referred to as specialty compute and storage solutions. All prior period information in the tables below has been revised to reflect the change to our three reportable segments.
•Memory Solutions: Our Memory Solutions group, under our SMART Modular brand, provides high performance and reliable memory solutions through the design, development and advanced packaging of leading-edge to extended lifecycle products. These specialty products are tailored to meet customer-specific requirements across networking and communications, enterprise storage, computing, including desktop, notebook and server applications, smartphones and other vertical markets. These products are marketed to OEMs and to commercial and government customers. The Memory Solutions group also offers SMART Supply Chain Services, which provides customized, integrated supply chain services to enable our customers to better manage supply chain planning and execution, reduce costs and increase productivity.
•Intelligent Platform Solutions (“IPS”): Our IPS group, under our Penguin Solutions brand, consists of two major product lines – Penguin Computing and Penguin Edge. Penguin Computing offers specialized platform solutions for high-performance computing, artificial intelligence, machine learning and advanced modeling for technology research. We provide these leading-edge solutions to customers in the government, hyper-scale, energy, financial services and education markets. Penguin Edge offers solutions for embedded and wireless applications, specializing in high-reliability products for a wide range of customers in government, telecommunications, health care, smart city, network edge and industrial applications.
•LED Solutions: Our LED Solutions group, under our Cree LED brand, offers a broad portfolio of application-optimized LEDs focused on improving on lumen density, intensity, efficacy, optical control and reliability. Backed by expert design assistance and superior sales support, our LED products enable our customers to develop and market LED-based products for general lighting, video screens and specialty lighting applications. Our LED Solutions is comprised of the LED Business we acquired from Cree, Inc. on March 1, 2021.
Segments are determined based on sources of revenue, types of customers and operating performance. There are no differences between the accounting policies for our segment reporting and our consolidated results of operations. Operating expenses directly associated with the activities of a specific segment are charged to that segment. Certain other
indirect operating income and expenses are generally allocated to segments based on their respective percentage of net sales. We do not allocate interest, other non-operating (income) expense or taxes to segments.
Three Months EndedNine Months Ended
May 27,
2022		May 28,
2021		May 27,
2022		May 28,
2021
Net sales:  
Memory Solutions$265,850 $240,116 $765,332 $684,537 
Intelligent Platform Solutions95,345 95,857 296,256 247,141 
LED Solutions101,345 101,755 320,067 101,755 
Total net sales$462,540 $437,728 $1,381,655 $1,033,433 
Segment operating income:
Memory Solutions$30,094 $26,163 $99,260 $65,262 
Intelligent Platform Solutions10,790 5,756 32,672 17,559 
LED Solutions13,388 11,386 48,925 11,386 
Total segment operating income54,272 43,305 180,857 94,207 
Unallocated:
Share-based compensation expense(10,547)(8,381)(30,295)(24,867)
Amortization of acquisition-related intangibles(5,943)(6,184)(18,115)(13,011)
Flow through of inventory step up—(7,090)—(7,090)
Change in fair value of contingent consideration(124)(16,400)(41,324)(16,400)
Out of period import tax expense (1)
— — — (4,345)
Other(2,349)(2,356)(4,215)(5,037)
Total unallocated(18,963)(40,411)(93,949)(70,750)
Consolidated operating income$35,309 $2,894 $86,908 $23,457 
(1)
During the second quarter of 2021, we recorded an out-of-period adjustment to correct errors originating in previous periods related to understated import tax costs, which resulted in a $4.3 million increase in cost of sales, $0.8 million increase in interest expense and $1.7 million benefit for income taxes. The adjustment was not considered material to the interim or annual consolidated financial statements for the year ended August 27, 2021 nor to any previously issued interim or annual consolidated financial statements.