Segment Information

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

Segment Information

Segment Information The Company’s operating segments are generally organized by the type of product or service offered. Similar operating segments have been aggregated into three reportable segments: Connected Machines, Subscriptions and Accessories and Materials. Segment information is presented in the same manner that the Company’s Chief Operating Decision Maker (“CODM”) reviews the results of operations in assessing performance and allocating resources. The CODM reviews revenue and gross profit for each of the reportable segments. Gross profit is defined as revenue less cost of revenue incurred by the segment. The Company does not allocate assets at the reportable segment level as these are managed on an entity wide group basis. As of March 31, 2023, long-lived assets located outside the United States, primarily located in Malaysia and China, were $18.0 million.

The Connected Machines segment derives revenue from the sale of its connected machine hardware and related essential software. The Subscriptions segment derives revenue primarily from monthly and annual subscription fees and a portion of the revenue allocated to unspecified future upgrades and enhancements related to the essential software and access to the Company’s cloud-based services. The Accessories and Materials segment primarily consists of craft, DIY, home décor products and heat presses including the Cricut EasyPress, Cricut Mug Press, and Cricut Autopress. There are no internal revenue transactions between the Company’s segments.

Key financial performance measures of the segments including revenue, cost of revenue and gross profit are as follows:

	Three Months Ended March 31,
	2023		2022
(in thousands)
Connected Machines:
Revenue	$	34,131	$	62,391
Cost of revenue	$	33,066	$	60,713
Gross profit	$	1,065	$	1,678
Subscriptions:
Revenue	$	75,083	$	64,778
Cost of revenue	$	7,631	$	6,252
Gross profit	$	67,452	$	58,526
Accessories and Materials:
Revenue	$	72,013	$	117,614
Cost of revenue	$	63,864	$	78,798
Gross profit	$	8,149	$	38,816
Consolidated:
Revenue	$	181,227	$	244,783
Cost of revenue	$	104,561	$	145,763
Gross profit	$	76,666	$	99,020