SEGMENT INFORMATION

We operate in four reportable segments: Phase I Deployment, Phase II Deployment, Services and Content & Entertainment or CEG. Our segments were determined based on the economic characteristics of our products and services, our internal organizational structure, the manner in which our operations are managed and the criteria used by our Chief Operating Decision Maker to evaluate performance, which is generally the segment’s income (loss) from continuing operations before interest, taxes, depreciation and amortization. Certain Corporate assets, liabilities and operating expenses are not allocated to our reportable segments.



Operations of:	Products and services provided:
Phase I Deployment	Financing vehicles and administrators for 3,724 Systems installed nationwide in Phase 1 DC's deployment to theatrical exhibitors. We retain ownership of the Systems and the residual cash flows related to the Systems after the repayment of all non-recourse debt at the expiration of exhibitor, master license agreements. As of September 30, 2016, we are no longer earning a significant portion of VPF revenues from certain major studios on 655 of such systems.
Phase II Deployment	Financing vehicles and administrators for our 8,904 Systems installed domestically and internationally, for which we retain no ownership of the residual cash flows and digital cinema equipment after the completion of cost recoupment and at the expiration of the exhibitor master license agreements.
Services	Provides monitoring, collection, verification and other management services to our Phase I Deployment, Phase II Deployment, CDF2 Holdings, as well as to exhibitors who purchase their own equipment. Services also collects and disburses VPFs from motion picture studios, distributors and ACFs from alternative content providers, movie exhibitors and theatrical exhibitors.
Content & Entertainment	Leading distributor of independent content, and collaborates with producers and other content owners to market, source, curate and distribute independent content to targeted and profitable audiences in theatres and homes, and via mobile and emerging platforms.

The following tables present certain financial information related to our reportable segments and Corporate:



	As of September 30, 2016
(In thousands)	Intangible Assets, net		Goodwill		Total Assets		Notes Payable, Non-Recourse		Notes Payable		Capital Leases
Phase I Deployment	$	183	$	—	$	34,427	$	74,139	$	—	$	—
Phase II Deployment	—		—		51,416		14,131		—		—
Services	—		—		1,009		—		—		—
Content & Entertainment	22,822		8,701		83,849		—		—		19
Corporate	12		—		5,532		—		84,584		4,041
Total	$	23,017	$	8,701	$	176,233	$	88,270	$	84,584	$	4,060



	March 31, 2016
(In thousands)	Intangible Assets, net		Goodwill		Total Assets		Notes Payable, Non-Recourse		Notes Payable		Capital Leases
Phase I Deployment	$	206	$	—	$	48,292	$	93,372	$	—	$	—
Phase II Deployment	—		—		53,727		18,940		—		—
Services	—		—		1,064		—		—		—
Content & Entertainment	25,721		8,701		87,344		—		—		30
Corporate	13		—		18,971		—		86,938		4,195
Total	$	25,940	$	8,701	$	209,398	$	112,312	$	86,938	$	4,225



	Statements of Operations
	For the Three Months Ended September 30, 2016
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	9,592	$	3,273	$	3,122	$	7,893		$	—		$	23,880
Direct operating (exclusive of depreciation and amortization shown below)	211		49		2		4,640			—			4,902
Selling, general and administrative	116		23		71		3,475			1,554			5,239
Allocation of Corporate overhead	—		—		398		904			(1,302		)	—
Restructuring, transition and acquisition expenses, net	—		—		—		(3		)	23			20
Depreciation and amortization of property and equipment	5,629		1,880		—		67			187			7,763
Amortization of intangible assets	12		—		—		1,449			3			1,464
Total operating expenses	5,968		1,952		471		10,532			465			19,388
Income (loss) from operations	$	3,624	$	1,321	$	2,651	$	(2,639	)	$	(465	)	$	4,492

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:



	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	2	$	—	$	—	$	2
Selling, general and administrative	—		—		1		47		692		740
Total stock-based compensation	$	—	$	—	$	3	$	47	$	692	$	742



	Statements of Operations
	For the Three Months Ended September 30, 2015
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	9,721	$	3,173	$	3,109	$	11,701		$	—		$	27,704
Direct operating (exclusive of depreciation and amortization shown below)	333		109		3		7,943			—			8,388
Selling, general and administrative	85		23		225		5,768			3,408			9,509
Allocation of Corporate overhead	—		—		405		1,354			(1,759		)	—
Provision for doubtful accounts	—		—		—		—			—			—
Restructuring, transition and acquisition expenses, net	—		—		—		—			63			63
Goodwill impairment	—		—		—		18,000			—			18,000
Litigation recovery, net of expenses	—		—		—		(1,208		)	—			(1,208		)
Depreciation and amortization of property and equipment	7,151		1,881		—		111			284			9,427
Amortization of intangible assets	11		—		—		1,449			3			1,463
Total operating expenses	7,580		2,013		633		33,417			1,999			45,642
Income (loss) from operations	$	2,141	$	1,160	$	2,476	$	(21,716	)	$	(1,999	)	$	(17,938	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:



	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	3	$	1	$	—	$	4
Selling, general and administrative	—		—		1		68		328		397
Total stock-based compensation	$	—	$	—	$	4	$	69	$	328	$	401



	Statements of Operations
	For the Six Months Ended September 30, 2016
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	18,756	$	6,453	$	6,417	$	14,729		$	—		$	46,355
Direct operating (exclusive of depreciation and amortization shown below)	434		102		1		10,053			—			10,590
Selling, general and administrative	249		82		302		7,544			3,497			11,674
Allocation of Corporate overhead	—		—		795		1,800			(2,595		)	—
Restructuring, transition and acquisition expenses, net	—		—		—		87			23			110
Depreciation and amortization of property and equipment	12,020		3,761		—		135			371			16,287
Amortization of intangible assets	23		—		—		2,899			5			2,927
Total operating expenses	12,726		3,945		1,098		22,518			1,301			41,588
Income (loss) from operations	$	6,030	$	2,508	$	5,319	$	(7,789	)	$	(1,301	)	$	4,767

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:



	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	3	$	2	$	—	$	5
Selling, general and administrative	—		—		1		93		921		1,015
Total stock-based compensation	$	—	$	—	$	4	$	95	$	921	$	1,020



	Statements of Operations
	For the Six Months Ended September 30, 2015
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	17,863	$	6,068	$	5,802	$	20,799		$	—		$	50,532
Direct operating (exclusive of depreciation and amortization shown below)	558		200		7		14,915			—			15,680
Selling, general and administrative	338		64		435		10,996			6,494			18,327
Allocation of Corporate overhead	—		—		807		2,701			(3,508		)	—
Provision for doubtful accounts	241		98		—		—			—			339
Restructuring, transition and acquisition expenses, net	—		—		—		—			196			196
Goodwill impairment	—		—		—		18,000			—			18,000
Litigation recovery, net of expenses	—		—		—		(410		)	—			(410		)
Depreciation and amortization of property and equipment	14,304		3,762		—		151			567			18,784
Amortization of intangible assets	19		—		—		2,899			4			2,922
Total operating expenses	15,460		4,124		1,249		49,252			3,753			73,838
Income (loss) from operations	$	2,403	$	1,944	$	4,553	$	(28,453	)	$	(3,753	)	$	(23,306	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:



	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	7	$	3	$	—	$	10
Selling, general and administrative	—		—		1		136		926		1,063
Total stock-based compensation	$	—	$	—	$	8	$	139	$	926	$	1,073