Segment Reporting

12 Months Ended

Dec. 31, 2022

Segment Reporting [Abstract]

Segment Reporting

12. Segment Reporting

The Company’s reportable segments have been determined using a management approach, which is consistent with the basis and manner in which the Company’s chief operating decision maker (“CODM”) uses financial information for the purposes of allocating resources and evaluating performance. The Company’s CODM is its Chief Executive Officer. The CODM evaluates the performance of the Company based on its total revenue and segment profit.

The CODM also uses revenue and segment profit to manage and evaluate our business, make planning decisions, and as performance measures for a Company-wide bonus plans. These key financial measures provide an additional view of our operational performance over the long-term and provide useful information that we use in order to maintain and grow our business.

The accounting policies of the segments are the same as those described in Note 2 “Accounting Policies and Practices.” The Company does not report assets by reportable segments as this information is not reviewed by the CODM on a regular basis.

Information regarding the Company’s current reportable segments is as follows (in millions):

	Revenue
	Successor				Predecessor
	Year Ended		Six Months Ended		Six Months Ended		Year Ended
	December 31,		December 31,		June 30,		December 31,
	2022		2021		2021		2020
Employer Solutions
Recurring	$	2,467	$	1,213	$	1,049	$	2,051
Project		251		134		107		237
Total Employer Solutions		2,718		1,347		1,156		2,288
Professional Services
Recurring		128		65		60		108
Project		243		121		124		260
Total Professional Services		371		186		184		368
Hosted Business		43		21		21		72
Total	$	3,132	$	1,554	$	1,361	$	2,728

	Segment Profit
	Successor						Predecessor
	Year Ended			Six Months Ended			Six Months Ended			Year Ended
	December 31,			December 31,			June 30,			December 31,
	2022			2021			2021			2020
Employer Solutions	$	659		$	344		$	274		$	533
Professional Services		1			1			7			31
Hosted Business		(1	)		(2	)		(3	)		—
Total of all reportable segments		659			343			278			564
Share-based compensation		181			67			5			5
Transaction and integration expenses(1)		19			13			—			—
Non-recurring professional expenses(2)		—			19			18			—
Transformation initiatives(3)		—			—			—			8
Restructuring		63			5			9			77
Other(4)		15			(10	)		(5	)		36
Depreciation		79			31			49			91
Intangible amortization		316			153			100			200
Operating (Loss) Income		(14	)		65			102			147
(Gain) Loss from change in fair value of financial instruments		(38	)		65			—			—
(Gain) Loss from change in fair value of tax receivable agreement		(41	)		(37	)		—			—
Interest expense		122			57			123			234
Other (income) expense, net		(16	)		3			9			7
Loss Before Income Tax Expense (Benefit)	$	(41	)	$	(23	)	$	(30	)	$	(94	)

(1)Transaction and integration expenses related to acquisitions in 2022 and 2021.

(2)Non-recurring professional expenses includes external advisor and legal costs related to the Company’s Business Combination.

(3)Transformation initiatives in fiscal year 2020 includes expenses related to enhancing our data center.

(4)Other primarily includes activity related to long-term incentives and expenses related to acquisitions, offset by Other (income) expense, net which was primarily comprised of contingent consideration earnout activities.

Revenue by geographic location is as follows (in millions):

	Successor					Predecessor
	Year Ended		Six Months Ended			Six Months Ended		Year Ended
	December 31,		December 31,			December 31,		December 31,
	2022		2021			2021		2020
United States	$	2,759	$	1,358	$		1,168	$	2,353
Rest of world		373		196			193		375
Total	$	3,132	$	1,554	$		1,361	$	2,728

There was no single client who accounted for more than 10% of the Company’s revenues in any of the periods presented.

Long-lived assets, representing Fixed assets, net and Operating lease right of use assets, by geographic location is as follows (in millions):

	Successor
	December 31,		December 31,
	2022		2021
United States	$	359	$	305
Rest of world		47		51
Total	$	406	$	356