Segment Information

9 Months Ended

Sep. 30, 2015

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 United States. The chief operating decision maker, who is the chief executive officer, evaluates performance, makes operating decisions, and allocates 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, restructuring costs 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 September 30, 2015, based on the Company’s internal financial reporting system utilized by the Company’s chief operating decision maker, follows (amounts in thousands):

	Business		Consumer		Corporate			Consolidated
Revenue:
Hosted services – Business	$	50,957	$	—	$	—		$	50,957
Hosted services – Consumer	—		3,661		—			3,661
Professional services	6,139		—		—			6,139
Total revenue	57,096		3,661		—			60,757
Cost of revenue	16,364		573		—			16,937
Sales and marketing	21,333		1,953		—			23,286
Amortization of purchased intangibles	1,193		—		—			1,193
Unallocated corporate expenses	—		—		17,442			17,442
Operating income (loss)	$	18,206	$	1,135	$	(17,442	)	$	1,899

Summarized financial information by segment for the three months ended September 30, 2014, based on the Company’s internal financial reporting system utilized by the Company’s chief operating decision maker, follows (amounts in thousands):

	Business		Consumer		Corporate			Consolidated
Revenue:
Hosted services – Business	$	43,702	$	—	$	—		$	43,702
Hosted services – Consumer	—		3,992		—			3,992
Professional services	5,093		—		—			5,093
Total revenue	48,795		3,992		—			52,787
Cost of revenue	12,679		625		—			13,304
Sales and marketing	19,488		1,490		—			20,978
Amortization of purchased intangibles	407		—		—			407
Unallocated corporate expenses	—		—		18,499			18,499
Operating income (loss)	$	16,221	$	1,877	$	(18,499	)	$	(401	)

Summarized financial information by segment for the nine months ended September 30, 2015, based on the Company’s internal financial reporting system utilized by the Company’s chief operating decision maker, follows (amounts in thousands):

	Business		Consumer		Corporate			Consolidated
Revenue:
Hosted services – Business	$	151,767	$	—	$	—		$	151,767
Hosted services – Consumer	—		11,219		—			11,219
Professional services	16,875		—		—			16,875
Total revenue	168,642		11,219		—			179,861
Cost of revenue	49,299		1,779		—			51,078
Sales and marketing	66,865		5,097		—			71,962
Amortization of purchased intangibles	3,683		—		—			3,683
Unallocated corporate expenses	—		—		60,975			60,975
Operating income (loss)	$	48,795	$	4,343	$	(60,975	)	$	(7,837	)

Summarized financial information by segment for the nine months ended September 30, 2014, based on the Company’s internal financial reporting system utilized by the Company’s chief operating decision maker, follows (amounts in thousands):

	Business		Consumer		Corporate			Consolidated
Revenue:
Hosted services – Business	$	125,378	$	—	$	—		$	125,378
Hosted services – Consumer	—		12,441		—			12,441
Professional services	13,883		—		—			13,883
Total revenue	139,261		12,441		—			151,702
Cost of revenue	36,306		1,894		—			38,200
Sales and marketing	55,203		4,246		—			59,449
Amortization of purchased intangibles	803		—		—			803
Unallocated corporate expenses	—		—		56,073			56,073
Operating income (loss)	$	46,949	$	6,301	$	(56,073	)	$	(2,823	)

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				Nine Months Ended
	September 30,				September 30,
	2015		2014		2015		2014
United States	$	39,972	$	34,409	$	120,409	$	99,273
Other Americas (1)	3,589		2,936		9,437		7,259
Total Americas	43,561		37,345		129,846		106,532
EMEA (2)	13,237		11,049		38,443		32,618
APAC (3)	3,959		4,393		11,572		12,552
Total revenue	$	60,757	$	52,787	$	179,861	$	151,702

⁽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):

	September 30,		December 31,
	2015		2014
United States	$	107,982	$	109,006
Israel	17,122		18,982
Australia	7,539		8,500
Netherlands	9,159		7,686
Other (1)	2,739		1,940
Total long-lived assets	$	144,541	$	146,114

⁽¹⁾ United Kingdom, Germany, Japan and Italy

No individual customer accounted for 10% or more of consolidated revenue for any of the periods presented. No individual customer accounted for 10% or more of accounts receivable as of September 30, 2015. One customer accounted for approximately 22% of accounts receivable as of December 31, 2014.