Business Segments and International Operations

6 Months Ended

May 31, 2020

Segment Reporting [Abstract]

Business Segments and International Operations

Business Segments and International Operations

Operating segments are components of an enterprise that engage in business activities for which discrete financial information is available and regularly reviewed by the chief operating decision maker in deciding how to allocate resources and assess performance. Our chief operating decision maker is our Chief Executive Officer.

We operate as three distinct business segments: OpenEdge, Data Connectivity and Integration, and Application Development and Deployment.

We do not manage our assets or capital expenditures by segment or assign other income (expense) and income taxes to segments. We manage and report such items on a consolidated company basis.

The following table provides revenue and contribution margin from our reportable segments and reconciles to our consolidated income from continuing operations before income taxes:

	Three Months Ended						Six Months Ended
(In thousands)	May 31, 2020			May 31, 2019			May 31, 2020			May 31, 2019
Segment revenue:
OpenEdge	$	77,735		$	67,820		$	154,814		$	133,072
Data Connectivity and Integration	3,662			12,932			17,347			18,932
Application Development and Deployment	18,986			19,243			37,905			37,540
Total revenue	100,383			99,995			210,066			189,544
Segment costs of revenue and operating expenses:
OpenEdge	17,876			19,097			37,626			37,412
Data Connectivity and Integration	1,629			1,806			4,309			3,306
Application Development and Deployment	6,986			5,547			14,274			10,974
Total costs of revenue and operating expenses	26,491			26,450			56,209			51,692
Segment contribution margin:
OpenEdge	59,859			48,723			117,188			95,660
Data Connectivity and Integration	2,033			11,126			13,038			15,626
Application Development and Deployment	12,000			13,696			23,631			26,566
Total contribution margin	73,892			73,545			153,857			137,852
Other unallocated expenses(1)	48,583			58,804			97,836			107,702
Income from operations	25,309			14,741			56,021			30,150
Other expense, net	(2,847		)	(2,317		)	(6,244		)	(4,320		)
Income before income taxes	$	22,462		$	12,424		$	49,777		$	25,830
(1)The following expenses are not allocated to our segments as we manage and report our business in these functional areas on a consolidated basis only: certain product development and corporate sales and marketing expenses, customer support, administration, amortization of acquired intangibles, stock-based compensation, restructuring, and acquisition-related expenses.

Our revenues are derived from licensing our products, and from related services, which consist of maintenance, hosting services, and consulting and education. Information relating to revenue from external customers by revenue type is as follows (in thousands):

	Three Months Ended				Six Months Ended
(In thousands)	May 31, 2020		May 31, 2019		May 31, 2020		May 31, 2019
Performance obligations transferred at a point in time:
Software licenses	$	19,663	$	29,728	$	50,292	$	52,530
Performance obligations transferred over time:
Maintenance	71,686		62,528		141,742		122,527
Services	9,034		7,739		18,032		14,487
Total revenue	$	100,383	$	99,995	$	210,066	$	189,544

In the following table, revenue attributed to North America includes sales to customers in the U.S. and sales to certain multinational organizations. Revenue from EMEA, Latin America and the Asia Pacific region includes sales to customers in each region plus sales from the U.S. to distributors in these regions. Information relating to revenue from external customers from different geographical areas is as follows (in thousands):

	Three Months Ended				Six Months Ended
(In thousands)	May 31, 2020		May 31, 2019		May 31, 2020		May 31, 2019
North America	$	56,564	$	57,060	$	121,977	$	103,558
EMEA	34,157		33,633		69,145		67,005
Latin America	3,346		4,108		7,346		8,569
Asia Pacific	6,316		5,194		11,598		10,412
Total revenue	$	100,383	$	99,995	$	210,066	$	189,544

No single customer, partner, or country outside of the U.S. has accounted for more than 10% of our total revenue for the three or six months ended May 31, 2020 and May 31, 2019. As of May 31, 2020 and November 30, 2019, no individual customer accounted for 10% or more of our net accounts receivable balance. As of May 31, 2020 and November 30, 2019, no individual foreign country accounted for 10% or more of total consolidated assets.