15. Segment Information

The Company evaluates the performance of, and allocates resources to, its segments based on revenue, gross profit and operating profit. The Company’s reportable segments have been identified based on commonality and adjacency of technologies, applications and customers amongst the Company’s individual product lines.

The Company operates in three reportable segments: Photonics, Vision, and Precision Motion. The reportable segments and their principal activities are described below.

Photonics

The Photonics segment designs, manufactures and markets photonics-based solutions, including CO2 lasers, continuous wave and femtosecond lasers, optical light engines, and laser scanning and laser beam delivery products, to customers worldwide. The segment serves highly demanding photonics-based applications such as industrial material processing, metrology, medical and life science imaging, DNA sequencing, and medical laser procedures. The vast majority of the segment’s product offerings are sold to OEM customers. The segment sells these products both directly, utilizing a highly technical sales force, and indirectly, through resellers and distributors.

Vision

The Vision segment designs, manufactures and markets a range of medical grade technologies, including visualization solutions, imaging informatics products, optical data collection and machine vision technologies, RFID technologies, thermal printers, light and color measurement instrumentation, and embedded touch screen solutions, to customers worldwide. The vast majority of the segment’s product offerings are sold to OEM customers. The segment sells these products both directly, utilizing a highly technical sales force, and indirectly, through resellers and distributors.

Precision Motion

The Precision Motion segment designs, manufactures and markets optical encoders, precision motor and motion control technology, air bearing spindles and precision machined components to customers worldwide. The vast majority of the segment’s product offerings are sold to OEM customers. The segment sells these products both directly, utilizing a highly technical sales force, and indirectly, through resellers and distributors.

Reportable Segment Financial Information

Revenue, gross profit, gross profit margin, operating income (loss) from continuing operations, and depreciation and amortization by reportable segments are as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30,		July 1,		June 30,		July 1,
	2017		2016		2017		2016
Revenue
Photonics	$	57,885	$	46,124	$	108,621	$	86,482
Vision		34,031		28,305		66,793		57,167
Precision Motion		27,186		23,305		52,662		44,401
Total	$	119,102	$	97,734	$	228,076	$	188,050

	Three Months Ended						Six Months Ended
	June 30,			July 1,			June 30,			July 1,
	2017			2016			2017			2016
Gross Profit
Photonics	$	26,668		$	20,861		$	48,457		$	38,858
Vision		14,440			10,524			27,586			20,103
Precision Motion		12,749			10,497			24,267			20,165
Unallocated Corporate and Shared Services		(368	)		(386	)		(727	)		(738	)
Total	$	53,489		$	41,496		$	99,583		$	78,388

	Three Months Ended						Six Months Ended
	June 30,			July 1,			June 30,			July 1,
	2017			2016			2017			2016
Gross Profit Margin
Photonics		46.1	%		45.2	%		44.6	%		44.9	%
Vision		42.4	%		37.2	%		41.3	%		35.2	%
Precision Motion		46.9	%		45.0	%		46.1	%		45.4	%
Total		44.9	%		42.5	%		43.7	%		41.7	%

	Three Months Ended						Six Months Ended
	June 30,			July 1,			June 30,			July 1,
	2017			2016			2017			2016
Operating Income (Loss) from Continuing Operations
Photonics	$	12,433		$	9,663		$	20,513		$	16,519
Vision		2,522			(2,700	)		4,047			(6,471	)
Precision Motion		7,581			5,178			14,745			10,413
Unallocated Corporate and Shared Services		(6,920	)		(4,543	)		(13,477	)		(10,276	)
Total	$	15,616		$	7,598		$	25,828		$	10,185

	Three Months Ended				Six Months Ended
	June 30,		July 1,		June 30,		July 1,
	2017		2016		2017		2016
Depreciation and Amortization
Photonics	$	3,783	$	1,759	$	7,027	$	3,303
Vision		2,477		2,301		4,914		5,401
Precision Motion		592		628		1,158		1,242
Unallocated Corporate and Shared Services		242		250		477		823
Total	$	7,094	$	4,938	$	13,576	$	10,769