Segment Information (Tables)

9 Months Ended

Sep. 30, 2024

Schedule of reconciliation of segment information to the totals reported in the accompanying consolidated financial statements

The tables below set forth information about the Company’s reportable operating segments for the three and nine months ended September 30, 2024 and 2023, along with the items necessary to reconcile the segment information to the totals reported in the accompanying condensed consolidated financial statements.


	Three Months Ended September 30,						Nine Months Ended September 30,
(In thousands, except percentages)	2024			2023			2024			2023
Digital Agreements
Revenue	$	15,405		$	13,012		$	45,280		$	36,426
Gross profit (1)	$	11,031		$	9,808		$	30,664		$	26,839
Gross margin	72		%	75		%	68		%	74		%
Operating income (loss) (2)	$	3,419		$	(4,666)		$	3,000		$	(17,820)

Security Solutions
Revenue	$	40,837		$	45,826		$	136,728		$	135,752
Gross profit (3)	$	30,517		$	30,861		$	98,620		$	87,410
Gross margin	75		%	67		%	72		%	64		%
Operating income (4)	$	20,200		$	15,673		$	66,770		$	39,827

Total Company:
Revenue	$	56,242		$	58,838		$	182,008		$	172,178
Gross profit	$	41,548		$	40,669		$	129,284		$	114,249
Gross margin	74		%	69		%	71		%	66		%

Statements of Operations reconciliation:
Segment operating income	$	23,619		$	11,007		$	69,770		$	22,007
Corporate operating expenses not allocated at the segment level	12,367			15,801			36,771			52,695
Operating income (loss)	$	11,252		$	(4,794)		$	32,999		$	(30,688)
Interest income, net	624			587			1,246			1,675
Other income (expense), net	(1,915)			353			(1,293)			342
Income (loss) before income taxes	$	9,961		$	(3,854)		$	32,952		$	(28,671)

(1) Digital Agreements gross profit includes intangible asset write-off of $0.8 million and internal capitalized software write-off of $0.7 million (see Note 7, Intangible Assets and Note 8, Property and Equipment, net ) for the nine months ended September 30, 2024.

(2) Digital Agreements operating income (loss) includes $0.6 million and $1.9 million of amortization of intangible assets expense for the three and nine months ended September 30, 2024, respectively, and $0.6 million and $1.7 million of amortization of intangible assets expense for the three and nine months ended September 30, 2023, respectively.

(3) Security Solutions gross profit includes $1.6 million of inventory impairments related to discontinuation of investments in our Digipass CX product for the nine months ended September 30, 2023 (see Note 5, Inventories, net).

(4) Security Solutions operating income includes $1.6 million of inventory impairments and $1.4 million of capitalized software write-offs related to discontinuation of investments in our Digipass CX product for the nine months ended September 30, 2023 (see Note 5, Inventories, net and Note 8, Property and Equipment, net).

Schedule of reconciliation of the disaggregated revenues to revenues from our two operating segments

The following tables illustrate the disaggregation of revenues by category and services, including a reconciliation of the disaggregated revenues to revenues from the Company’s two reportable operating segments for the three and nine months ended September 30, 2024 and 2023:


	Three Months Ended September 30,
	2024				2023
(In thousands)	Digital Agreements		Security Solutions		Digital Agreements		Security Solutions
Subscription	$	15,045	$	18,603	$	11,807	$	14,378
Maintenance and support	327		9,317		995		11,276
Professional services and other (1)	33		820		210		1,333
Hardware products	—		12,097		—		18,839
Total Revenue	$	15,405	$	40,837	$	13,012	$	45,826


	Nine Months Ended September 30,
	2024				2023
(In thousands)	Digital Agreements		Security Solutions		Digital Agreements		Security Solutions
Subscription	$	43,641	$	59,642	$	32,641	$	46,485
Maintenance and support	1,321		29,125		3,121		31,914
Professional services and other (1)	318		3,548		664		4,002
Hardware products	—		44,413		—		53,351
Total Revenue	$	45,280	$	136,728	$	36,426	$	135,752

(1) Professional services and other includes perpetual software licenses revenue, which was less than 1% of total revenue for both the three and nine months ended September 30, 2024 and approximately 1% of total revenue for both the three and nine months ended September 30, 2023.