Segment Information

9 Months Ended

Dec. 31, 2011

Segment Information [Abstract]

Segment Information

Note 10 – Segment Information

In previous fiscal years, the Company operated in four business segments: products, web application performance management services, professional services and application services. Effective April 1, 2011, the Company realigned its business unit structure which had the following effect: (1) the former products segment split into four new segments: Application Performance Management, Mainframe, Changepoint and Uniface; (2) the former web performance services segment (Gomez SaaS solution) and Gomez On-premises software (formerly Vantage) are combined within the APM segment; and (3) the operating results of our software related professional services are reported within APM, Mainframe, Changepoint and Uniface, as applicable (previously reported in the Professional Services segment).

As a result of these changes, Compuware now has six business segments: APM, Mainframe, Changepoint, Uniface, Professional Services and Covisint Application Services.

This business unit structure should provide the Company with better visibility and control over the operations of the business and increase its market agility, enabling it to more effectively capitalize on market conditions and competitive advantages to maximize revenue growth and profitability. The segment presentation in the prior period has been recast to conform to the current presentation of the business segments. This change did not have an impact on previously reported consolidated financial results.

The Company's products and services are offered worldwide to the largest IT organizations across a broad spectrum of technologies, including mainframe, distributed, Internet and mobile platforms and provide the following capabilities:

· APM includes Gomez SaaS and On-premises solutions. The SaaS solutions are designed to test and monitor the performance, availability and quality of companies' web and mobile applications. The On-premises solutions provide detailed application insight that identifies and helps correct the causes of poor application performance within client workstations, network, server, Java and .NET environments. dynaTrace operations are included within our APM segment. The acquisition of dynaTrace provided additional technology which enables continuous tracking of business transactions and provides exact identification of performance problems, enhancing our Gomez On-premises software solutions.

· Mainframe solutions are designed to improve the productivity of development, maintenance and support teams in application analysis, testing, defect detection and remediation, fault management, file and data management, data compliance and application performance management specifically within IBM mainframe environments.

· Changepoint is a business portfolio management and professional services automation solution that addresses the needs of executives within technology companies, enterprise IT and professional services organizations, allowing for management of the entire customer lifecycle, as well as for improved process efficiency, planning and visibility across program, project and product portfolios.

· Uniface is a rapid application development environment for building, renewing and integrating the largest and most complex enterprise applications. Uniface enables enterprises to meet increasing demand for developing complex, secure and global Web 2.0 applications, deployable on any platform including the cloud.

· Professional services include a broad range of IT services for mainframe, distributed and mobile environments, including mobile computing application development and integration, package software customization, cloud computing consulting, and development and integration of legacy systems.

· Covisint services are provided on a SaaS platform and use business-to-business applications to integrate vital business information and processes between partners, customers and suppliers.

The Company evaluates the performance of its segments based primarily on operating profit before certain charges such as internal information system support, finance, human resources, legal, administration and other corporate charges (“unallocated expenses”). The allocation of income taxes is not evaluated at the segment level. Financial information for the Company's business segments was as follows (in thousands):

	Three Months Ended
	December 31, 2011
														Unallocated
	APM			MF		CP		UF		PS		AS		Expenses			Total
Software license fees	$	24,360		$	26,720	$	3,513	$	2,528	$	-	$	-	$	-		$	57,121
Maintenance fees		19,441			75,782		3,895		7,725		-		-		-			106,843
Subscription fees		19,379			-		552		-		-		-		-			19,931
Professional services fees		8,893			558		4,517		981		35,626		-		-			50,575
Application services fees		-			-		-		-		-		18,587		-			18,587
Total revenues		72,073			103,060		12,477		11,234		35,626		18,587		-			253,057
Operating expenses		82,118			24,721		11,683		5,044		31,794		17,265		47,839			220,464
Income (loss) from operations	$	(10,045	)	$	78,339	$	794	$	6,190	$	3,832	$	1,322	$	(47,839	)	$	32,593

	Three Months Ended
	December 31, 2010
															Unallocated
	APM			MF		CP			UF		PS		AS		Expenses			Total
Software license fees	$	21,059		$	34,877	$	1,545		$	2,671	$	-	$	-	$	-		$	60,152
Maintenance fees		17,194			77,838		3,742			7,547		-		-		-			106,321
Subscription fees		17,841			-		-			-		-		-		-			17,841
Professional services fees		5,937			1,784		4,141			1,354		35,116		-		-			48,332
Application services fees		-			-		-			-		-		14,379		-			14,379
Total revenues		62,031			114,499		9,428			11,572		35,116		14,379		-			247,025
Operating expenses		63,450			26,419		11,680			4,932		29,108		12,719		49,236			197,544
Income (loss) from operations	$	(1,419	)	$	88,080	$	(2,252	)	$	6,640	$	6,008	$	1,660	$	(49,236	)	$	49,481

	Nine Months Ended
	December 31, 2011
																Unallocated
	APM			MF		CP			UF		PS		AS			Expenses			Total
Software license fees	$	54,142		$	83,874	$	7,643		$	7,299	$	-	$	-		$	-		$	152,958
Maintenance fees		57,003			230,776		11,647			23,482		-		-			-			322,908
Subscription fees		56,639			-		1,517			-		-		-			-			58,156
Professional services fees		22,646			3,960		12,487			3,259		115,051		-			-			157,403
Application services fees		-			-		-			-		-		52,302			-			52,302
Total revenues		190,430			318,610		33,294			34,040		115,051		52,302			-			743,727
Operating expenses		231,489			72,926		33,989			15,595		95,045		53,934			150,379			653,357
Income (loss) from operations	$	(41,059	)	$	245,684	$	(695	)	$	18,445	$	20,006	$	(1,632	)	$	(150,379	)	$	90,370

	Nine Months Ended
	December 31, 2010
															Unallocated
	APM			MF		CP			UF		PS		AS		Expenses			Total
Software license fees	$	53,520		$	72,346	$	6,145		$	7,084	$	-	$	-	$	-		$	139,095
Maintenance fees		47,912			233,465		10,904			21,878		-		-		-			314,159
Subscription fees		48,769			-		-			-		-		-		-			48,769
Professional services fees		15,404			4,918		11,489			3,390		104,375		-		-			139,576
Application services fees		-			-		-			-		-		37,780		-			37,780
Total revenues		165,605			310,729		28,538			32,352		104,375		37,780		-			679,379
Operating expenses		177,527			73,591		34,370			14,231		87,748		34,159		145,024			566,650
Income (loss) from operations	$	(11,922	)	$	237,138	$	(5,832	)	$	18,121	$	16,627	$	3,621	$	(145,024	)	$	112,729

The Company does not evaluate assets and capital expenditures on a segment basis, and accordingly such information is not provided.

Financial information regarding geographic operations is presented in the table below (in thousands):

	Three Months Ended				Nine Months Ended
	December 31,				December 31,
	2011		2010		2011		2010
Revenues:
United States	$	154,857	$	148,842	$	475,193	$	426,738
Europe and Africa		67,426		64,479		177,756		165,890
Other international operations		30,774		33,704		90,778		86,751
Total revenues	$	253,057	$	247,025	$	743,727	$	679,379

	As of		As of
	December 31,		March 31,
	2011		2011
Long-lived assets
United States	$	946,653	$	944,506
Europe and Africa		241,297		33,037
Other international operations		7,998		7,838
Total long-lived assets	$	1,195,948	$	985,381

Long-lived assets are comprised of property, plant and equipment, goodwill and capitalized software.  As of December 31, 2011, long-lived assets in Europe include goodwill associated with the dynaTrace acquisition which is recorded in Austria (see Note 2 for additional information).