Segment Information

12 Months Ended

Jun. 30, 2022

Segment Reporting [Abstract]

Segment Information

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 – Summary of 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, deferred revenue fair value adjustment, net interest expense (income), loss attributable to equity method investments, gains and losses on equity 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, 2022, 2021 and 2020 (in thousands):

	2022		2021		2020
Net revenue by segment
Total Sleep and Respiratory Care	$	3,177,298	$	2,823,235	$	2,602,381
Software as a Service	400,829		373,590		356,734
Deferred revenue fair value adjustment (1)	—		—		(2,102)
Total Software as a Service	400,829		373,590		354,632
Total	$	3,578,127	$	3,196,825	$	2,957,013
Depreciation and amortization by segment
Sleep and Respiratory Care	$	79,367	$	73,151	$	69,444
Software as a Service	7,315		5,230		3,850
Amortization of acquired intangible assets and corporate assets	72,927		78,377		81,556
Total	$	159,609	$	156,758	$	154,850
Net operating profit by segment
Sleep and Respiratory Care	$	1,132,510	$	1,036,712	$	934,697
Software as a Service	93,821		93,037		82,152
Total	$	1,226,331	$	1,129,749	$	1,016,849
Reconciling items
Corporate costs	$	155,317	$	141,193	$	125,993
Amortization of acquired intangible assets	70,728		76,205		79,695
Restructuring expenses	—		8,673		—
Litigation settlement expenses	—		—		(600)
Deferred revenue fair value adjustment (1)	—		—		2,102
Interest expense (income), net	22,312		23,627		39,356
Loss attributable to equity method investments	8,486		11,205		25,058
(Gain) loss on equity investments	12,202		(14,515)		14,519
Other, net	(3,197)		(301)		(2,362)
Income before income taxes	$	960,483	$	883,662	$	733,088

(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, 2022, 2021 and 2020 (in thousands):

	2022		2021		2020
U.S., Canada and Latin America
Devices	$	1,070,420	$	863,661	$	792,766
Masks and other	911,387		841,452		779,561
Total Sleep and Respiratory Care	$	1,981,807	$	1,705,113	$	1,572,327
Software as a Service	400,829		373,590		354,632
Total	$	2,382,636	$	2,078,703	$	1,926,959
Combined Europe, Asia and other markets
Devices	$	796,488	$	746,379	$	715,056
Masks and other	399,003		371,743		314,998
Total Sleep and Respiratory Care	$	1,195,491	$	1,118,122	$	1,030,054
Global revenue
Devices	$	1,866,908	$	1,610,040	$	1,507,822
Masks and other	1,310,390		1,213,195		1,094,559
Total Sleep and Respiratory Care	$	3,177,298	$	2,823,235	$	2,602,381
Software as a Service	400,829		373,590		354,632
Total	$	3,578,127	$	3,196,825	$	2,957,013

Revenue information by geographic area for the years ended June 30, 2022, 2021 and 2020 is summarized below (in thousands):

	2022		2021		2020
United States	$	2,249,381	$	1,962,721	$	1,828,575
Rest of the World	1,328,746		1,234,104		1,128,438
Total	$	3,578,127	$	3,196,825	$	2,957,013

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, 2022 and 2021 is summarized below (in thousands):

	2022		2021
Australia	$	192,833	$	186,289
United States	169,090		159,815
Singapore	72,821		64,182
Rest of the World	63,309		53,204
Total	$	498,053	$	463,490