SEGMENT REPORTING

3 Months Ended

Mar. 31, 2014

SEGMENT REPORTING

SEGMENT REPORTING

NOTE 19 — SEGMENT REPORTING

Our business segments are based upon our organizational structure, which focuses primarily on the services offered, and are consistent with the internal reporting used by our Chief Executive Officer to evaluate operating performance and to assess the allocation of our resources.

We classify our business into three reporting segments. The Mortgage Services segment provides services that span the mortgage and real estate lifecycle and are typically outsourced by loan servicers, loan originators and investors in single family homes. The Financial Services segment provides collection and customer relationship management services primarily to debt originators and servicers (e.g., credit card, auto lending, retail credit and mortgage) and the utility and insurance industries. The Technology Services segment principally consists of our REALSuite™ software applications, Equator’s software applications as well as our information technology infrastructure services.  The REALSuite platform provides a fully integrated set of software applications and technologies that manage the end-to-end lifecycle for residential and commercial mortgage loan servicing including the automated management and payment of a distributed network of vendors. Equator’s software applications provide comprehensive, end-to-end workflow and transaction services to manage real estate and foreclosure related activities and purchase related services from vendors.  In addition, Corporate Items and Eliminations include eliminations of transactions between the reporting segments and costs related to corporate support functions including executive, finance, legal, human resources, vendor management, risk and operational effectiveness.

Financial information for our segments is as follows:

	Three months ended March 31, 2014
									Corporate
	Mortgage		Financial			Technology			Items and			Consolidated
(in thousands)	Services		Services			Services			Eliminations			Altisource
Revenue	$	175,776	$	24,285		$	47,504		$	(8,296	)	$	239,269
Cost of revenue	102,804		14,613			37,765			(7,377		)	147,805
Gross profit	72,972		9,672			9,739			(919		)	91,464
Selling, general and administrative expenses	19,194		4,663			6,594			13,083			43,534
Income from operations	53,778		5,009			3,145			(14,002		)	47,930
Other income (expense), net	48		(1		)	(16		)	(4,760		)	(4,729		)
Income before income taxes and non-controlling interests	$	53,826	$	5,008		$	3,129		$	(18,762	)	$	43,201

	Three months ended March 31, 2013
									Corporate
	Mortgage			Financial			Technology		Items and			Consolidated
(in thousands)	Services			Services			Services		Eliminations			Altisource
Revenue	$	117,448		$	16,336		$	20,231	$	(5,188	)	$	148,827
Cost of revenue	72,369			12,026			17,112		(4,545		)	96,962
Gross profit	45,079			4,310			3,119		(643		)	51,865
Selling, general and administrative expenses	5,458			2,850			1,865		8,507			18,680
Income from operations	39,621			1,460			1,254		(9,150		)	33,185
Other income (expense), net	(173		)	(3		)	4		(2,335		)	(2,507		)
Income before income taxes and non-controlling interests	$	39,448		$	1,457		$	1,258	$	(11,485	)	$	30,678

							Corporate
	Mortgage		Financial		Technology		Items and		Consolidated
(in thousands)	Services		Services		Services		Eliminations		Altisource
Total assets:
March 31, 2014	$	315,551	$	59,784	$	248,359	$	110,357	$	734,051
December 31, 2013	310,253		55,930		274,766		85,928		726,877

Our services are provided to customers primarily located in the United States.  Premises and equipment, net consist of the following, by country:

	March 31,		December 31,
(in thousands)	2014		2013
United States	$	69,817	$	63,615
India	16,509		16,404
Luxembourg	4,410		3,217
Philippines	3,803		4,016
Total	$	94,539	$	87,252