Segment Information

9 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Segment Information

Segment Information

We are organized into the following three operating segments, each of which is a reportable segment, to align with internal management of our worldwide business operations based on product offerings.

• Applications. Our Applications products are pre-configured decision management applications and associated professional services, designed for a specific type of business problem or process, such as marketing, account origination, customer management, fraud and insurance claims management.

• Scores. This segment includes our business-to-business scoring solutions, our myFICO^® solutions for consumers and associated professional services. Our scoring solutions give our clients access to analytics that can be easily integrated into their transaction streams and decision-making processes. Our scoring solutions are distributed through major credit reporting agencies, as well as services through which we provide our scores to clients directly.

• Tools. The Tools segment is composed of software tools and associated professional services that clients can use to create their own custom decision management applications.

Our Chief Executive Officer evaluates segment financial performance based on segment revenues and segment operating income. Segment operating expenses consist of direct and indirect costs principally related to personnel, facilities, consulting, travel and depreciation. Indirect costs are allocated to the segments generally based on relative segment revenues, fixed rates established by management based upon estimated expense contribution levels and other assumptions that management considers reasonable. We do not allocate broad-based incentive expense, share-based compensation expense, restructuring expense, amortization expense, various corporate charges and certain other income and expense measures to our segments. These income and expense items are not allocated because they are not considered in evaluating the segment’s operating performance. Our Chief Executive Officer does not evaluate the financial performance of each segment based on its respective assets or capital expenditures; rather, depreciation amounts are allocated to the segments from their internal cost centers as described above.

The following tables summarize segment information for the quarters and nine months ended June 30, 2015 and 2014:

	Quarter Ended June 30, 2015
	Applications			Scores			Tools			Unallocated Corporate Expenses			Total
	(In thousands)
Segment revenues:
Transactional and maintenance	$	79,731		$	54,255		$	10,709		$	—		$	144,695
Professional services	31,009			615			6,374			—			37,998
License	16,394			884			9,395			—			26,673
Total segment revenues	127,134			55,754			26,478			—			209,366
Segment operating expense	(90,228		)	(14,736		)	(28,554		)	(20,773		)	(154,291		)
Segment operating income (loss)	$	36,906		$	41,018		$	(2,076	)	$	(20,773	)	55,075
Unallocated share-based compensation expense													(12,166		)
Unallocated amortization expense													(3,599		)
Unallocated restructuring and acquisition-related													(2,256		)
Operating income													37,054
Unallocated interest expense, net													(7,360		)
Unallocated other income, net													770
Income before income taxes													$	30,464
Depreciation expense	$	3,734		$	258		$	834		$	621		$	5,447

	Quarter Ended June 30, 2014
	Applications			Scores			Tools			Unallocated Corporate Expenses			Total
	(In thousands)
Segment revenues:
Transactional and maintenance	$	78,915		$	44,077		$	9,262		$	—		$	132,254
Professional services	31,898			801			5,823			—			38,522
License	19,043			452			7,339			—			26,834
Total segment revenues	129,856			45,330			22,424			—			197,610
Segment operating expense	(86,413		)	(11,444		)	(24,923		)	(25,424		)	(148,204		)
Segment operating income (loss)	$	43,443		$	33,886		$	(2,499	)	$	(25,424	)	49,406
Unallocated share-based compensation expense													(9,345		)
Unallocated amortization expense													(3,019		)
Unallocated restructuring and acquisition-related													(621		)
Operating income													36,421
Unallocated interest expense, net													(7,051		)
Unallocated other income, net													931
Income before income taxes													$	30,301
Depreciation expense	$	3,616		$	213		$	706		$	630		$	5,165

	Nine Months Ended June 30, 2015
	Applications			Scores			Tools			Unallocated Corporate Expenses			Total
	(In thousands)
Segment revenues:
Transactional and maintenance	$	238,597		$	145,006		$	31,185		$	—		$	414,788
Professional services	90,500			2,369			18,273			—			111,142
License	47,923			2,257			29,915			—			80,095
Total segment revenues	377,020			149,632			79,373			—			606,025
Segment operating expense	(274,157		)	(42,246		)	(86,080		)	(62,145		)	(464,628		)
Segment operating income (loss)	$	102,863		$	107,386		$	(6,707	)	$	(62,145	)	141,397
Unallocated share-based compensation expense													(32,762		)
Unallocated amortization expense													(10,046		)
Unallocated restructuring and acquisition-related													(2,256		)
Operating income													96,333
Unallocated interest expense, net													(22,283		)
Unallocated other income, net													771
Income before income taxes													$	74,821
Depreciation expense	$	10,948		$	702		$	2,424		$	1,973		$	16,047

	Nine Months Ended June 30, 2014
	Applications			Scores			Tools			Unallocated Corporate Expenses			Total
	(In thousands)
Segment revenues:
Transactional and maintenance	$	233,592		$	133,955		$	26,731		—			$	394,278
Professional services	87,058			2,167			18,202			—			107,427
License	36,732			4,246			24,732			—			65,710
Total segment revenues	357,382			140,368			69,665			—			567,415
Segment operating expense	(247,326		)	(32,758		)	(66,798		)	(71,253		)	(418,135		)
Segment operating income	$	110,056		$	107,610		$	2,867		$	(71,253	)	149,280
Unallocated share-based compensation expense													(25,631		)
Unallocated amortization expense													(8,940		)
Unallocated restructuring and acquisition-related													(4,281		)
Operating income													110,428
Unallocated interest expense, net													(21,276		)
Unallocated other expense, net													(381		)
Income before income taxes													$	88,771
Depreciation expense	$	10,714		$	623		$	1,942		$	1,977		$	15,256