Note

– Segment Information

Based on the provisions of ASC

280,

“Segment Reporting,” and the manner in which the Chief Operating Decision Maker analyzes the business, Qualstar has determined that it has

two

separate operating segments: power supply and data storage. Segment revenue, loss before income taxes and total assets were as follows, in thousands:

	Twelve Months Ended December 31,
	201 9		201 8
Revenue
Power Supplies	$	5,079	$	5,927
Data Storage:
Product		4,194		3,111
Service		4,166		3,191
Total Data Storage	$	8,360	$	6,302
Total Revenue	$	13,439	$	12,229

	Twelve Months Ended December 31,
	201 9			201 8
Income (loss) before Taxes
Power Supplies	$	(866	)	$	(153	)
Data Storage		841			1,643
Total Income (Loss) Before Income Taxes	$	(25	)	$	1,490

	December 31 , 201 9		December 31, 201 8
Total Assets
Power Supplies
Cash and cash equivalents	$	527	$	381
Accounts receivable, net		840		1,048
Inventories, net		872		1,576
Property and equipment		11		47
Other assets		107		102
		2,357		3,154
Data Storage
Cash and cash equivalents		3,336		4,400
Restricted cash		100		100
Accounts receivable, net		1,526		761
Inventories, net		1,668		1,321
Property and equipment		111		65
Right of use		676		-
Other assets		264		197
		7,681		6,844
Total Assets	$	10,038	$	9,998

In its operation of the business, management reviews certain financial information, including segmented internal profit and loss statements prepared on a basis consistent with GAAP. Our

two

segments are power supplies and data storage. The

two

segments discussed in this analysis are presented in the way we internally managed and monitored performance for the

twelve

months ended

December 31, 2019.

Internal resources were billed for the

twelve

months ended

December 31, 2019

and

2018.

Until the creation of our subsidiary to operate our power supply business, the power supplies segment tracked certain assets separately, and all others were recorded in the data storage segment for internal reporting presentations. Upon the creation of

N2Power,

Inc., the assets were separated, and the internal resources were billed appropriately.

The types of products and services provided by each segment are summarized below:

Power Supplies

— The Company designs, manufactures, and sells small, open frame, high efficiency switching power supplies. These power supplies are used to convert AC line voltage to DC voltages, or DC voltages to other DC voltages for use in a wide variety of electronic equipment such as telecommunications equipment, machine tools, routers, switches, wireless systems and gaming devices.

Data Storage

— The Company configures to order, supports and sells data storage devices used to store, retrieve and manage electronic data primarily in network computing environments. Tape libraries consist of cartridge tape drives, tape cartridges and robotics to move the cartridges from their storage locations to the tape drives under software control. Our tape libraries provide data storage solutions for organizations requiring backup, recovery and archival storage of critical data.

Geographic Information

Information regarding revenues attributable to Qualstar’s primary geographic operating regions is as follows, in thousands:

	Twelve Months Ended December 31,
	201 9		201 8
Total Revenue:
North America	$	7,900	$	6,957
Europe		1,696		1,849
Asia Pacific		3,787		3,276
Other		56		147
	$	13,439	$	12,229
Power Supply Revenue:
North America		3,507		3,356
Europe		1,118		1,220
Asia Pacific		454		1,351
Other		—		—
	$	5,079	$	5,927
Data Storage Revenue:
North America		4,393		3,601
Europe		578		629
Asia Pacific		3,333		1,925
Other		56		147
	$	8,360	$	6,302

The geographic classification of revenues is based upon the location to which the product is shipped. Qualstar does

not

have any significant long-lived assets outside of the United States.