Segment and Other Information

9 Months Ended

May 26, 2023

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. We have the following three businesses, which are our 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 and newly acquired Stratus Technologies brands, offers specialized platform solutions and services for high-performance computing (“HPC”), artificial intelligence (“AI”), machine learning (“ML”), advanced modeling and the internet of things (“IoT”) that span the continuum of edge, core and cloud. Our solutions are designed specifically for customers across multiple markets, including government, hyperscale, energy, financial services, health care, education and others. On

August 29, 2022, we completed the acquisition of Stratus Technologies, a global leader in simplified, protected and autonomous computing solutions in the data center and at the Edge.

•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.

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 Ended				Nine Months Ended
	May 26, 2023		May 27, 2022		May 26, 2023		May 27, 2022
Net sales:
Memory Solutions	$	148,370	$	265,850	$	491,473	$	765,332
Intelligent Platform Solutions	170,854		95,345		604,276		296,256
LED Solutions	64,106		101,345		182,233		320,067
Total net sales	$	383,330	$	462,540	$	1,277,982	$	1,381,655
Segment operating income:
Memory Solutions	$	11,284	$	30,094	$	46,859	$	99,260
Intelligent Platform Solutions	25,798		10,790		97,942		32,672
LED Solutions	(782)		13,388		(2,237)		48,925
Total segment operating income	36,300		54,272		142,564		180,857
Unallocated:
Share-based compensation expense	(10,031)		(10,547)		(30,838)		(30,295)
Amortization of acquisition-related intangibles	(11,609)		(5,943)		(33,282)		(18,115)
Flow through of inventory step up	—		—		(2,599)		—
Cost of sales-related restructure	(211)		—		(5,763)		—
Acquisition and integration expenses	(8,637)		(2,181)		(18,193)		(3,471)
Impairment of goodwill	—		—		(17,558)		—
Change in fair value of contingent consideration	(14,800)		(124)		(24,900)		(41,324)
Restructure charge	186		(249)		(6,009)		(249)
Other	—		81		(1,800)		(495)
Total unallocated	(45,102)		(18,963)		(140,942)		(93,949)
Consolidated operating income (loss)	$	(8,802)	$	35,309	$	1,622	$	86,908