Segment Information

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company accounts for its segment information in accordance with the provisions of ASC 280-10, “Segment Reporting.” ASC 280-10 establishes annual and interim reporting standards for operating segments of a company. ASC 280-10 requires disclosures of selected segment-related financial information about products, major customers, and geographic areas based on the Company’s internal accounting methods. The Company is organized into two operating segments for purposes of making operating decisions and assessing performance. The Business segment facilitates real-time online interactions – chat, voice and content delivery across multiple channels and screens for global corporations of all sizes. The Consumer segment facilitates online transactions between Experts and Users and sells its services to consumers. Both segments currently generate their revenue primarily in the U.S. The chief operating decision makers evaluate performance, make operating decisions, and allocate resources based on the operating income of each segment. The reporting segments follow the same accounting polices used in the preparation of the Company’s condensed consolidated financial statements which are described in the summary of significant accounting policies. The Company allocates cost of revenue, sales and marketing and amortization of purchased intangibles to the segments, but it does not allocate product development expenses, general and administrative expenses and income tax expense because management does not use this information to measure performance of the operating segments. There are currently no inter-segment sales.

Summarized financial information by segment for the three months ended March 31, 2014, based on the Company’s internal financial reporting system utilized by the Company’s chief operating decision makers, follows (amounts in thousands):

	Business		Consumer		Corporate			Consolidated
Revenue:
Hosted services – Business	$	39,680	$	—	$	—		$	39,680
Hosted services – Consumer	—		3,910		—			3,910
Professional services	4,238		—		—			4,238
Total revenue	43,918		3,910		—			47,828
Cost of revenue	11,220		515		—			11,735
Sales and marketing	16,918		1,477		—			18,395
Amortization of purchased intangibles	190		—		—			190
Unallocated corporate expenses	—		—		18,450			18,450
Operating income (loss)	$	15,590	$	1,918	$	(18,450	)	$	(942	)

Summarized financial information by segment for the three months ended March 31, 2013, based on the Company’s internal financial reporting system utilized by the Company’s chief operating decision makers, follows (amounts in thousands):

	Business		Consumer		Corporate			Consolidated
Revenue:
Hosted services – Business	$	36,144	$	—	$	—		$	36,144
Hosted services – Consumer	—		3,620		—			3,620
Professional services	2,732		—		—			2,732
Total revenue	38,876		3,620		—			42,496
Cost of revenue	9,536		598		—			10,134
Sales and marketing	13,206		1,272		—			14,478
Amortization of purchased intangibles	224		—		—			224
Unallocated corporate expenses	—		—		18,259			18,259
Operating income (loss)	$	15,910	$	1,750	$	(18,259	)	$	(599	)

Geographic Information

The Company is domiciled in the United States and has international operations in the United Kingdom, Asia-Pacific, Latin America and Western Europe, particularly France and Germany. The following table presents the Company’s revenues attributable to domestic and foreign operations for the periods presented (amounts in thousands):

	Three Months Ended
	March 31,
	2014		2013
United States	$	31,098	$	28,639
Other Americas (1)	2,150		1,967
Total Americas	33,248		30,606
EMEA (2)	10,515		7,921
APAC (3)	4,065		3,969
Total revenue	$	47,828	$	42,496

⁽¹⁾ Canada, Latin America and South America

⁽²⁾ Europe, the Middle East and Africa (“EMEA”)

⁽³⁾ Asia-Pacific (“APAC”)

The following table presents the Company's long-lived assets by geographic region for the periods presented (amounts in thousands):

	March 31,		December 31,
	2014		2013
United States	$	38,757	$	34,422
Israel	21,332		22,580
Australia	9,317		9,827
Netherlands	3,628		3,540
United Kingdom	1,550		1,539
Total long-lived assets	$	74,584	$	71,908

No individual customer accounted for 10% or more of consolidated revenue in the three months ended March 31, 2014 and 2013. One customer accounted for approximately 15% and 12% of accounts receivable at March 31, 2014 and December 31, 2013, respectively.