Business Segments

3 Months Ended

Jun. 28, 2020

Business Segments

Operating Segments

Note 7. Business Segments

The Company evaluates its business within two segments: commercial and retail. The commercial segment consists of the following customer markets: (1) public carriers, that are generally responsible for building and maintaining the infrastructure system and provide airtime service to individual subscribers; and (2) value-added resellers and integrators, which includes value-added resellers, the government channel and private system operator markets.

The retail segment consists of the retail market which includes retailers, independent dealer agents and carriers.

To provide investors with better visibility, the Company also discloses revenue and gross profit by its four product categories:

● Base Station Infrastructure - Base station infrastructure products are used to build, repair and upgrade wireless telecommunications systems. Products include base station antennas, cable and transmission lines, small towers, lightning protection devices, connectors, power systems, miscellaneous hardware, and mobile antennas. Base station infrastructure service offerings include connector installation, custom jumper assembly, site kitting and logistics integration.

● Network Systems - Network systems products are used to build and upgrade computing and internet networks.  Products include fixed and mobile broadband equipment, distributed antenna systems (DAS), wireless networking, filtering systems, two-way radios and security and surveillance products.  This product category also includes training classes, technical support and engineering design services.

● Installation, Test and Maintenance - Installation, test and maintenance products are used to install, tune, maintain and repair wireless communications equipment. Products include sophisticated analysis equipment and various frequency, voltage- and power-measuring devices, as well as an assortment of tools, hardware, GPS, safety and replacement and component parts and supplies required by service technicians.  

● Mobile Device Accessories - Mobile device accessories include cellular phone and data device accessories such as replacement batteries, cases, speakers, mobile amplifiers, power supplies, headsets, mounts, car antennas, music accessories and data and memory cards. Retail merchandising displays, promotional programs, customized order fulfillment services and affinity-marketing programs, including private label internet sites, complement our mobile devices and accessory product offering.

The Company evaluates revenue, gross profit, and income before provision for income taxes at the segment level.  Certain cost of sales and other applicable expenses have been allocated to each segment based on a percentage of revenues and/or gross profit, where appropriate.

Segment activity for the first quarter of fiscal years 2021 and 2020 are as follows (in thousands):

	Three Months Ended
	June 28, 2020						June 30, 2019
	Commercial		Retail				Commercial		Retail
	Segment		Segment		Total		Segment		Segment		Total
Revenues
Public carrier	$	39,255	$	—	$	39,255	$	33,486	$	—	$	33,486
Value-added resellers and integrators		57,223		—		57,223		65,194		—		65,194
Retail		—		23,336		23,336		—		32,049		32,049
Total revenues	$	96,478	$	23,336	$	119,814	$	98,680	$	32,049	$	130,729
Gross Profit
Public carrier	$	3,728	$	—	$	3,728	$	4,253	$	—	$	4,253
Value-added resellers and integrators		12,725		—		12,725		15,969		—		15,969
Retail		—		2,373		2,373		—		5,042		5,042
Total gross profit	$	16,453	$	2,373	$	18,826	$	20,222	$	5,042	$	25,264
Directly allocable expenses		7,462		1,832		9,294		9,570		3,015		12,585
Segment net profit contribution	$	8,991	$	541		9,532	$	10,652	$	2,027		12,679
Corporate support expenses						14,551						16,209
Income before provision for income taxes					$	(5,019)					$	(3,530)

Supplemental revenue and gross profit information by product category for the first quarter of fiscal years 2021 and 2020 are as follows (in thousands):

	Three Months Ended
	June 28, 2020		June 30, 2019
Revenues
Base station infrastructure	$	68,855	$	69,069
Network systems		19,400		22,552
Installation, test and maintenance		5,462		6,025
Mobile device accessories		26,097		33,083
Total revenues	$	119,814	$	130,729
Gross Profit
Base station infrastructure	$	11,418	$	14,521
Network systems		2,133		3,927
Installation, test and maintenance		766		1,084
Mobile device accessories		4,509		5,732
Total gross profit	$	18,826	$	25,264