Segment Information & Geographic Data

12 Months Ended

Dec. 31, 2020

Segment Reporting [Abstract]

Segment Information & Geographic Data

Segment Information & Geographic Data

Segment results

The Company’s operations consist of two reportable segments: Asset Intelligence & Tracking (“AIT”) and Enterprise Visibility & Mobility (“EVM”). The reportable segments have been identified based on the financial data utilized by the Company’s Chief Executive Officer (the chief operating decision maker or “CODM”) to assess segment performance and allocate resources among the Company’s segments. The CODM reviews adjusted operating income to assess segment profitability. To the extent applicable, segment operating income excludes purchase accounting adjustments, amortization of intangible assets, acquisition and integration costs, impairment of goodwill and other intangibles, exit and restructuring costs, and product sourcing diversification costs. Segment assets are not reviewed by the Company’s CODM and therefore are not disclosed below.

Financial information by segment is presented as follows (in millions):

	Year Ended December 31,
	2020		2019		2018
Net sales:
AIT	$	1,426	$	1,479	$	1,423
EVM	3,029		3,006		2,795
Total segment net sales	4,455		4,485		4,218
Corporate, eliminations(1)	(7)		—		—
Total Net sales	$	4,448	$	4,485	$	4,218
Operating income:
AIT(2)	$	322	$	355	$	325
EVM(2)	466		483		404
Total segment operating income	788		838		729
Corporate, eliminations(1)	(137)		(146)		(119)
Total Operating income	$	651	$	692	$	610

(1)To the extent applicable, amounts included in Corporate, eliminations consist of purchase accounting adjustments, amortization of intangible assets, acquisition and integration costs, impairment of goodwill and other intangibles, exit and restructuring costs, and product sourcing diversification costs.

(2)AIT and EVM segment operating income includes depreciation and share-based compensation expense. The amounts of depreciation and share-based compensation expense attributable to AIT and EVM are proportionate to each segment’s Net sales.

Sales to significant customers

Our Net sales to significant customers as a percentage of the total Company’s Net sales by segment were as follows:

	Year Ended December 31,
	2020						2019						2018
	AIT		EVM		Total		AIT		EVM		Total		AIT		EVM		Total
Customer A	4.8	%	12.9	%	17.7	%	5.3	%	13.0	%	18.3	%	6.2	%	14.1	%	20.3	%
Customer B	4.9	%	9.0	%	13.9	%	4.7	%	9.0	%	13.7	%	5.6	%	10.1	%	15.7	%
Customer C	6.5	%	14.2	%	20.7	%	6.1	%	10.5	%	16.6	%	6.2	%	7.9	%	14.1	%

These customers accounted for 13.6%, 6.7%, and 20.4%, respectively, of accounts receivable as of December 31, 2020, and 16.8%, 7.8% and 20.6%, respectively, of accounts receivable as of December 31, 2019. No other customer accounted for more than 10% of total Net sales during the years ended December 31, 2020, 2019 or 2018, or more than 10% of outstanding

accounts receivables as of December 31, 2020 or 2019. All three of the above customers are distributors of the Company’s products and solutions and not end users.

Geographic data

Information regarding the Company’s operations by geographic area is contained in the following tables. Net sales amounts are attributed to geographic area based on customer location.

Net sales by region were as follows (in millions):

	Year Ended December 31,
	2020		2019		2018
North America	$	2,319	$	2,261	$	2,041
EMEA	1,495		1,462		1,409
Asia-Pacific	439		518		520
Latin America	195		244		248
Total Net sales	$	4,448	$	4,485	$	4,218

The United States and Germany were the only countries that accounted for more than 10% of the Company’s net sales in 2020, 2019, and 2018. Net sales during these years were as follows (in millions):

	Year Ended December 31,
	2020		2019		2018
United States	$	2,291	$	2,243	$	2,020
Germany	595		523		523
Other	1,562		1,719		1,675
Total Net sales	$	4,448	$	4,485	$	4,218

For the years ended December 31, 2020 and 2019, the Company presented revenues by major country on the same basis as revenues by region, which is based on customer location. Prior to 2019, the Company presented revenues by major country based on the country where products, solutions, and services were invoiced from. Revenues by major country for the year ended December 31, 2018 are presented above based on the location of customer, in order to conform to the same basis of presentation as the subsequent years.

Geographic data for long-lived assets is as follows (in millions):

	Year Ended December 31,
	2020		2019		2018
North America	$	289	$	280	$	225
EMEA	68		39		14
Asia-Pacific	45		40		7
Latin America	7		7		3
Total long-lived assets	$	409	$	366	$	249

Long-lived assets are defined by the Company as property, plant and equipment as well as ROU assets. ROU assets were recognized upon adoption of ASC 842 in 2019, prior to which, there were no long-lived assets related to leasing activities. Primarily all of the Company’s long-lived assets in the North America region are located in the United States.