Geographic And Segment Reporting

6 Months Ended

Jun. 30, 2011

Geographic And Segment Reporting

Geographic and Segment Reporting

NOTE 4 — GEOGRAPHIC AND SEGMENT REPORTING

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by our chief operating decision maker, or decision-making group, in assessing performance and deciding how to allocate resources. Our reportable operating segments are Licenses, Maintenance Services and Professional Services. The Licenses segment develops and markets licenses to use our software products. The Maintenance Services segment provides after-sale support for software products. The Professional Services segment provides consulting and fee-based training related to our software products.

Previously, we had two reportable operating segments, Licenses and Services. During the first quarter of 2011, we revised our reportable operating segments by separating our Services segment into our Professional Services segment and our Maintenance Services segment. We separated these two previously aggregated segments because the Professional Services component has experienced significant growth and has become more distinct, robust and pronounced relative to all Services, and also has become more separately managed and analyzed. Previously reported segment data have been reclassified to conform to the 2011 presentation. Goodwill previously allocated to the Services segment has been reallocated between the Maintenance Services and Professional Services segments using a relative fair value approach.

We do not separately allocate operating expenses to these segments, nor do we allocate specific assets to these segments. Therefore, segment information reported includes only revenues, cost of revenues, and gross profit.

Reportable segment data for the three months and six months ended June 30, 2011 and 2010 is as follows (in thousands):

	Licenses		Maintenance Services		Professional Services		Total
Three months ended June 30, 2011:
Revenues	$	77,632	$	110,276	$	15,062	$	202,970
Cost of revenues		7,799		10,469		12,165		30,433
Gross profit	$	69,833	$	99,807	$	2,897	$	172,537
Three months ended June 30, 2010:
Revenues	$	77,100	$	98,520	$	10,482	$	186,102
Cost of revenues		5,858		7,409		8,227		21,494
Gross profit	$	71,242	$	91,111	$	2,255	$	164,608
Six months ended June 30, 2011:
Revenues	$	144,367	$	218,342	$	28,418	$	391,127
Cost of revenues		14,233		20,480		23,120		57,833
Gross profit	$	130,134	$	197,862	$	5,298	$	333,294
Six months ended June 30, 2010:
Revenues	$	142,081	$	194,288	$	20,904	$	357,273
Cost of revenues		12,172		14,638		15,722		42,532
Gross profit	$	129,909	$	179,650	$	5,182	$	314,741

Revenues are attributed to geographic areas based on the location of the Quest entity from which the products or services were invoiced. Revenues and long-lived assets concerning principal geographic areas in which we operate are as follows (in thousands):

	United States		Ireland		Other International  (2)		Total
Three months ended/As of June 30, 2011:
Revenues	$	120,152	$	36,359	$	46,459	$	202,970
Long-lived assets (1)		113,636		7,802		13,912		135,350
Three months ended/As of June 30, 2010:
Revenues	$	117,248	$	22,520	$	46,334	$	186,102
Long-lived assets (1)		84,902		8		12,636		97,546
Six months ended/As of June 30, 2011:
Revenues	$	232,899	$	67,324	$	90,904	$	391,127
Long-lived assets (1)		113,636		7,802		13,912		135,350
Six months ended/As of June 30, 2010:
Revenues	$	220,291	$	43,547	$	93,435	$	357,273
Long-lived assets (1)		84,902		8		12,636		97,546

(1) Includes property and equipment, net and other assets

(2) No single location within Other International accounts for greater than 10% of total revenues