Segment Information

12 Months Ended

Jun. 30, 2021

Segment Information [Abstract]

Segment Information

(15)  Segment Information

We have two operating segments, which are the Sleep and Respiratory Care segment and the SaaS segment. We evaluate the performance of our segments based on net sales and income from operations. The accounting policies of the segments are the same as those described in note 2 – significant accounting policies. Segment net sales and segment income from operations do not include inter-segment profits and revenue is allocated to a geographic area based on where the products are shipped to or where the services are performed.

Certain items are maintained at the corporate level and are not allocated to the segments. The non-allocated items include corporate headquarters costs including stock-based compensation, amortization expense of acquired intangibles, restructuring expenses, litigation settlement expenses, acquisition related expenses, deferred revenue fair value adjustment, net interest expense, loss attributable to equity method investments, and other, net. We neither discretely allocate assets to our operating segments, nor does our Chief Operating Decision Maker evaluate the operating segments using discrete asset information.

The table below presents a reconciliation of net revenues, depreciation and amortization and net operating profit by reportable segments for the years ended June 30, 2021, 2020 and 2019 (in thousands):

	2021		2020		2019
Net revenue by segment
Total Sleep and Respiratory Care	$	2,823,235	$	2,602,381	$	2,330,783
Software as a Service		373,590		356,734		281,137
Deferred revenue fair value adjustment (1)		-		(2,102)		(5,348)
Total Software as a Service		373,590		354,632		275,789
Total	$	3,196,825	$	2,957,013	$	2,606,572
Depreciation and amortization by segment
Sleep and Respiratory Care	$	73,151	$	69,444	$	70,094
Software as a Service		5,230		3,850		3,250
Amortization of acquired intangible assets and corporate assets		78,377		81,556		77,451
Total	$	156,758	$	154,850	$	150,795
Net operating profit by segment
Sleep and Respiratory Care	$	1,036,712	$	934,697	$	766,068
Software as a Service		93,037		82,152		74,886
Total	$	1,129,749	$	1,016,849	$	840,954
Reconciling items
Corporate costs	$	141,193	$	125,993	$	124,682
Amortization of acquired intangible assets		76,205		79,695		74,938
Restructuring expenses		8,673		-		9,401
Litigation settlement expenses		-		(600)		41,199
Acquisition related expenses		-		-		6,123
Deferred revenue fair value adjustment (1)		-		2,102		5,348
Interest expense (income), net		23,627		39,356		33,857
Loss attributable to equity method investments		11,205		25,058		15,833
Other, net		(14,816)		12,157		10,726
Income before income taxes	$	883,662	$	733,088	$	518,847

(1)The deferred revenue fair value adjustment is a purchase price accounting adjustment related to MatrixCare which was acquired on November 13, 2018.

The following table summarizes our net revenue disaggregated by segment, product and region for the years ended June 30, 2021, 2020 and 2019 (in thousands):

	2021		2020		2019
U.S., Canada and Latin America
Devices	$	863,661	$	792,766	$	743,066
Masks and other		841,452		779,561		677,430
Total Sleep and Respiratory Care	$	1,705,113	$	1,572,327	$	1,420,496
Software as a Service		373,590		354,632		275,789
Total	$	2,078,703	$	1,926,959	$	1,696,285
Combined Europe, Asia and other markets
Devices	$	746,379	$	715,056	$	618,525
Masks and other		371,743		314,998		291,762
Total Sleep and Respiratory Care	$	1,118,122	$	1,030,054	$	910,287
Global revenue
Devices	$	1,610,040	$	1,507,822	$	1,361,591
Masks and other		1,213,195		1,094,559		969,192
Total Sleep and Respiratory Care	$	2,823,235	$	2,602,381	$	2,330,783
Software as a Service		373,590		354,632		275,789
Total	$	3,196,825	$	2,957,013	$	2,606,572

Revenue information by geographic area for the years ended June 30, 2021, 2020 and 2019 is summarized below (in thousands):

	2021		2020		2019
United States	$	1,962,721	$	1,828,575	$	1,588,655
Rest of the World		1,234,104		1,128,438		1,017,917
Total	$	3,196,825	$	2,957,013	$	2,606,572

Long-lived assets of geographic areas are those assets used in our operations in each geographical area, and excludes goodwill, other intangible assets, and deferred tax assets. Long-lived assets by geographic area as of June 30, 2021, 2020 and 2019, is summarized below (in thousands):

	2021		2020
Australia		186,289		162,490
United States	$	159,815	$	164,155
Singapore		64,182		39,977
Rest of the World		53,204		50,713
Total	$	463,490	$	417,335