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Segment Reporting
 9 Months Ended
Sep. 30, 2024
Segment Reporting [Abstract]  
Segment Reporting Segment Reporting
Harte Hanks is a leading global customer experience company. Beginning in 2024, we have organized our operations into four reportable segments based on the types of products and services we provide: Marketing Services, Customer Care, Sales Services and Fulfillment & Logistics Services. The Sales Service is our new reportable segment for 2024 as it has become strategically more important for our company. It was included in Customer Care segment in 2023. 2023 segment reporting has been restated to reflect this change.
Our Marketing Services segment leverages data, insight, and experience to support clients as they engage customers through digital, traditional, and emerging channels. We partner with clients to develop strategies and tactics to identify and prioritize customer audiences in B2C and B2B transactions. Our key service offerings include strategic business, brand, marketing and communications planning, data strategy, audience identification and prioritization, predictive modeling, creative development and execution across traditional and digital channels, website and app development, platform architecture, database build and management, marketing automation, and performance measurement, reporting and optimization.
Our Customer Care segment offers intelligently responsive contact center solutions, which use real-time data to effectively interact with each customer. Customer contacts are handled through phone, e-mail, social media, text messaging, chat and
digital self-service support. We provide these services utilizing our advanced technology infrastructure, human resource management skills and industry experience.
Our Sales Services segment enables customers to optimize their go-to-market function by offering a range of outsourced services including sales process optimization, sales play development, inbound lead qualification and outbound sales prospecting.
Our Fulfillment & Logistics segment consists of mail and product fulfillment and logistics services. We offer a variety of product fulfillment solutions, including printing on demand, managing product recalls, and distributing literature and promotional products to support B2B trade, drive marketing campaigns, and improve customer experience. We are also a provider of third-party logistics and freight optimization in the United States.
There are two principal financial measures reported to our CEO (the chief operating decision maker) for use in assessing segment performance and allocating resources. Those measures are revenue and operating income (loss)”). Operating income for segment reporting disclosed below, is revenues less operating costs and allocated corporate expenses. Segment operating expenses include allocations of certain centrally incurred costs such as employee benefits, occupancy, information systems, accounting services, internal legal staff, and human resources administration. These costs are allocated based on actual usage or other appropriate methods. Unallocated corporate expenses are corporate overhead expenses not attributable to the operating groups. Interest income and expense are not allocated to the segments. The Company does not allocate assets to our reportable segments for internal reporting purposes, nor does our CEO evaluate reportable segments using discrete asset information. The accounting policies of the segments are consistent with those described in the Note A, Overview and Significant Accounting Policies.
The following table presents financial information by segment for the three months ended September 30, 2024:
In thousandsMarketing ServicesCustomer CareSales ServicesFulfillment & LogisticsRestructuringUnallocated CorporateTotal
Revenue$9,050 $13,068 $4,205 $21,307 $— $— $47,630 
Segment operating expense6,158 9,995 3,318 19,192 836 5,195 44,694 
Contribution margin (loss)$2,892 $3,073 $887 $2,115 $(836)$(5,195)$2,936 
Overhead allocation792 567 189 775 — (2,323)— 
Depreciation and amortization167 44 198 266 — 363 1,038 
Operating income (loss)$1,933 $2,462 $500 $1,074 $(836)$(3,235)$1,898 
The following table presents financial information by segment for the three months ended September 30, 2023:
In thousandsMarketing ServicesCustomer CareSales ServicesFulfillment & LogisticsRestructuringUnallocated CorporateTotal
Revenue$10,591 $11,832 $2,166 $22,530 $— $— $47,119 
Segment operating expense8,370 9,380 1,959 18,995 — 4,549 43,253 
Contribution margin (loss)$2,221 $2,452 $207 $3,535 $— $(4,549)$3,866 
Overhead allocation706 668 — 680 — (2,054)— 
Depreciation and amortization71 57 196 249 — 379 952 
Operating income (loss)$1,444 $1,727 $11 $2,606 $— $(2,874)$2,914 
The following table presents financial information by segment for the nine months ended September 30, 2024:
In thousandsMarketing ServicesCustomer CareSales ServicesFulfillment & LogisticsRestructuring ExpenseUnallocated CorporateTotal
Revenue$25,709 $37,894 $13,281 $61,229 $— $— $138,113 
Segment operating expense19,355 28,856 9,891 54,348 2,116 16,795 131,361 
Contribution margin (loss)$6,354 $9,038 $3,390 $6,881 $(2,116)$(16,795)$6,752 
Overhead allocation2,454 1,761 587 2,403 — (7,205)— 
Depreciation and amortization509 160 589 757 — 1,091 3,106 
Operating income (loss)$3,391 $7,117 $2,214 $3,721 $(2,116)$(10,681)$3,646 
The following table presents financial information by segment for the nine months ended September 30, 2023:
In thousandsMarketing ServicesCustomer CareSales ServicesFulfillment & LogisticsRestructuring ExpenseUnallocated CorporateTotal
Revenue$32,751 $38,372 $7,253 $63,625 $— $— $142,001 
Segment operating expense26,464 30,259 6,275 54,435 — 15,880 133,313 
Contribution margin (loss)$6,287 $8,113 $978 $9,190 $— $(15,880)$8,688 
Overhead allocation2,261 2,102 — 2,203 — (6,566)— 
Depreciation and amortization167 438 586 736 — 1,124 3,051 
Operating income (loss)$3,859 $5,573 $392 $6,251 $— $(10,438)$5,637