SEGMENT AND GEOGRAPHIC DATA

12 Months Ended

Feb. 28, 2021

Segment Reporting [Abstract]

SEGMENT AND GEOGRAPHIC DATA

NOTE 21 – SEGMENT AND GEOGRAPHIC DATA

Since the LoJack U.S. SVR Products operating segment is presented as discontinued operations, we now operate under two reportable segments: Telematics Products and Software & Subscription Services. Our organizational structure is based on a number of factors that our CEO, the Chief Operating Decision Maker (“CODM”), uses to evaluate and operate the business, which include customer base, homogeneity of products, and technology for the fiscal years presented.

Our Telematics Products segment offers a portfolio of wireless data communications products, which includes asset tracking units, mobile telematics devices, fixed and mobile wireless gateways and routers. These wireless networking devices underpin a wide range of our own and third party software and service solutions worldwide and are critical for applications demanding secure, reliable and business-critical communications. Telematics Products segment revenues consist primarily of stand-alone product sales.

Our Software & Subscription Services segment offers cloud-based, application enablement and telematics service platforms that facilitate integration of our own applications, as well as those of third parties, through open Applications Programing Interfaces (“APIs”) to deliver full-featured IoT solutions to a wide range of customers and markets. Our scalable proprietary SaaS offerings enable rapid and cost-effective deployment of high-value solutions for customers all around the globe. Software & Subscription Services segment revenues includes SaaS, professional services, devices sold with monitoring services and amortization of revenues and costs for customized devices functional only with application subscriptions that are not sold separately.

Information by business segment is as follows (in thousands):

	Year ended February 28, 2021
	Operating Segments
	Software & Subscription Services			Telematics Products			Corporate Expenses			Total
Revenues	$	129,933		$	178,654					$	308,587
Gross profit	$	65,411		$	56,994					$	122,405
Gross margin		50.3	%		31.9	%					39.7	%
Adjusted EBITDA	$	32,226		$	4,854		$	(4,974	)	$	32,106

	Year ended February 29, 2020
	Operating Segments
	Software & Subscription Services			Telematics Products			Corporate Expenses			Total
Revenues	$	123,460		$	198,313					$	321,773
Gross profit	$	56,283		$	69,210					$	125,493
Gross margin		45.6	%		34.9	%					39.0	%
Adjusted EBITDA	$	21,674		$	21,763		$	(4,528	)	$	38,909

	Year ended February 28, 2019
	Operating Segments
	Software & Subscription Services			Telematics Products			Corporate Expenses			Total
Revenues	$	74,842		$	236,696					$	311,538
Gross profit	$	36,412		$	89,466					$	125,878
Gross margin		48.7	%		37.8	%					40.4	%
Adjusted EBITDA	$	12,429		$	37,833		$	(5,699	)	$	44,563

The amount shown for each period in the “Corporate Expenses” column above consists of expenses that are not allocated to the business segments. These unallocated corporate expenses include salaries and benefits of certain corporate staff and expenses such as audit fees, investor relations, stock listing fees, director and officer liability insurance, and director fees and expenses.

Our CODM evaluates each segment based primarily on revenue and Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”), and we therefore consider Adjusted EBITDA to be a primary measure of operating performance of our operating segments. We define Adjusted EBITDA as earnings before investment income, interest expense, taxes, depreciation, amortization and stock-based compensation, impairment loss and other adjustments as identified below. The adjustments to our financial results prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) to calculate Adjusted EBITDA are itemized below (in thousands):

	Year Ended February 28/29,
	2021			2020			2019
Net income (loss) from continuing operations	$	(21,157	)	$	(51,552	)	$	20,672
Investment income		(2,119	)		(4,497	)		(5,258	)
Interest expense		15,487			20,096			16,726
Income tax provision (benefits)		561			20,454			(612	)
Depreciation and amortization		22,002			23,312			9,786
Stock-based compensation		10,357			10,667			9,539
Impairment loss and equity in net loss of affiliate		-			530			6,787
Loss on extinguishment of debt		-			2,408			2,033
Acquisition and integration related expenses		-			2,210			935
Non-recurring legal expenses, net of reversal of litigation provision		2,262			6,213			(11,020	)
Gain on LoJack battery performance legal Settlement		-			-			(7,543	)
Restructuring		2,534			2,465			2,299
Impairment losses		825			5,754			-
Other		1,354			849			219
Adjusted EBITDA	$	32,106		$	38,909		$	44,563

Our CODM does not obtain identifiable assets by segment because our businesses share resources, functions and facilities. We do not have significant long-lived assets outside the United States.

Revenue by geographic area are as follows (in thousands):

	Year Ended February 28/29,
	2021		2020		2019
United States	$	200,665	$	222,079	$	216,191
Europe, Middle East and Africa		58,470		55,185		49,496
South America		27,110		21,235		15,134
Asia and Pacific Rim		12,281		9,166		13,958
All other		10,061		14,108		16,759
	$	308,587	$	321,773	$	311,538

Revenues by geographic area are based upon the country of billing. The geographic location of distributors and OEM customers may be different from the geographic location of the ultimate end users of the products and services provided by us. No single non-U.S. country accounted for more than 10% of our revenue in fiscal years ended February 28/29, 2021, 2020 and 2019 .