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Segment Information
12 Months Ended
Jul. 31, 2020
Segment Reporting [Abstract]  
Segment Information Segment Information
Reportable operating segments are determined based on Comtech’s management approach. The management approach, as defined by FASB ASC 280 "Segment Reporting" is based on the way that the CODM organizes the segments within an enterprise for making decisions about resources to be allocated and assessing their performance. Our CODM, for purposes of FASB ASC 280, is our Chief Executive Officer.

Our Commercial Solutions segment offers satellite ground station technologies (such as modems and amplifiers) and public safety and location technologies (such as 911 call routing and mapping solutions) to commercial customers and smaller government customers, such as state and local governments. This segment also serves certain large government customers (including the U.S. government) that have requirements for off-the-shelf commercial equipment.

Our Government Solutions segment provides mission-critical technologies (such as tactical satellite-based networks and ongoing support for complicated communications networks) and high-performance transmission technologies (such as troposcatter systems and solid-state, high-power amplifiers) to large government end-users (including those of foreign countries), large international customers and domestic prime contractors.
Our CODM primarily uses a metric that we refer to as Adjusted EBITDA to measure an operating segment’s performance and to make decisions about resources to be allocated. Our Adjusted EBITDA metric for the Commercial Solutions and Government Solutions segments do not consider any allocation of indirect expense, or any of the following: income taxes, interest (income) and other, write-off of deferred financing costs, interest expense, amortization of stock-based compensation, amortization of intangible assets, depreciation expense, estimated contract settlement costs, settlement of intellectual property litigation, acquisition plan expenses or facility exit costs that relate to our Unallocated segment. These items, while periodically affecting our results, may vary significantly from period to period and may have a disproportionate effect in a given period, thereby affecting the comparability of results. Any amounts shown in the Adjusted EBITDA calculation for our Commercial Solutions and Government Solutions segments are directly attributable to those segments. Our Adjusted EBITDA is also used by our management in assessing the Company's operating results. Although closely aligned, the Company's definition of Adjusted EBITDA is different than the Consolidated EBITDA (as such term is defined in our Credit Facility) utilized for financial covenant calculations and also may differ from the definition of EBITDA or Adjusted EBITDA used by other companies and, therefore, may not be comparable to similarly titled measures used by other companies.

Operating segment information, along with a reconciliation of segment net income (loss) and consolidated net income to Adjusted EBITDA is presented in the tables below:
 Fiscal Year Ended July 31, 2020
 Commercial SolutionsGovernment SolutionsUnallocatedTotal
Net sales$353,730,000 262,985,000  $616,715,000 
Operating income (loss)$34,820,000 19,988,000 (39,634,000)$15,174,000 
Net income (loss)
$34,414,000 20,232,000 (47,626,000)$7,020,000 
     Provision for (benefit from) income taxes
410,000 (100,000)1,980,000 2,290,000 
     Interest (income) and other
(31,000)(169,000)10,000 (190,000)
     Interest expense27,000 25,000 6,002,000 6,054,000 
     Amortization of stock-based compensation
  9,275,000 9,275,000 
     Amortization of intangibles
17,325,000 4,270,000  21,595,000 
     Depreciation
8,347,000 1,446,000 768,000 10,561,000 
     Estimated contract settlement costs
444,000   444,000 
     Acquisition plan expenses
751,000  20,003,000 20,754,000 
Adjusted EBITDA
$61,687,000 25,704,000 (9,588,000)$77,803,000 
Purchases of property, plant and equipment
$5,281,000 1,617,000 327,000 $7,225,000 
Long-lived assets acquired in connection with acquisitions
$6,060,000 32,391,000  $38,451,000 
Total assets at July 31, 2020$647,964,000 232,052,000 49,631,000 $929,647,000 
 Fiscal Year Ended July 31, 2019
 Commercial SolutionsGovernment SolutionsUnallocatedTotal
Net sales$357,293,000 314,504,000  $671,797,000 
Operating income (loss)$36,053,000 28,997,000 (23,643,000)$41,407,000 
Net income (loss)
$35,888,000 29,029,000 (39,876,000)$25,041,000 
     Provision for income taxes
19,000  3,850,000 3,869,000 
     Interest (income) and other
75,000 (41,000)1,000 35,000 
     Write-off of deferred financing costs  3,217,000 3,217,000 
     Interest expense71,000 9,000 9,165,000 9,245,000 
     Amortization of stock-based compensation
  11,427,000 11,427,000 
     Amortization of intangibles
14,944,000 3,376,000  18,320,000 
     Depreciation
9,265,000 1,891,000 771,000 11,927,000 
     Estimated contract settlement costs
6,351,000   6,351,000 
     Settlement of intellectual property litigation
  (3,204,000)(3,204,000)
     Acquisition plan expenses
  5,871,000 5,871,000 
     Facility exit costs
 1,373,000  1,373,000 
Adjusted EBITDA
$66,613,000 $35,637,000 $(8,778,000)$93,472,000 
Purchases of property, plant and equipment
$6,293,000 1,902,000 590,000 $8,785,000 
Long-lived assets acquired in connection with acquisitions
$60,693,000   $60,693,000 
Total assets at July 31, 2019$662,580,000 186,438,000 38,693,000 $887,711,000 

 Fiscal Year Ended July 31, 2018
 Commercial SolutionsGovernment SolutionsUnallocatedTotal
Net sales$345,076,000 225,513,000  $570,589,000 
Operating income (loss)$40,837,000 10,950,000 (16,712,000)$35,075,000 
Net income (loss)
$40,297,000 10,835,000 (21,363,000)$29,769,000 
     Provision for (benefit from) income taxes
270,000  (5,413,000)(5,143,000)
     Interest (income) and other
151,000 112,000 (9,000)254,000 
     Interest expense119,000 3,000 10,073,000 10,195,000 
     Amortization of stock-based compensation
  8,569,000 8,569,000 
     Amortization of intangibles
17,699,000 3,376,000  21,075,000 
     Depreciation
9,479,000 3,088,000 1,088,000 13,655,000 
Adjusted EBITDA
$68,015,000 17,414,000 (7,055,000)$78,374,000 
Purchases of property, plant and equipment
$7,151,000 901,000 590,000 $8,642,000 
Total assets at July 31, 2018$610,166,000 195,924,000 39,067,000 $845,157,000 
Unallocated expenses result from corporate expenses such as executive compensation, accounting, legal and other regulatory compliance related costs and also includes all of our amortization of stock-based compensation. During fiscal 2020 and 2019, we recorded $20,754,000 and $5,871,000 of acquisition plan expenses, respectively. These expenses were recorded primarily in our unallocated expenses. See Note (2) -"Acquisitions" for further information. In addition, offsetting unallocated expenses in fiscal 2019 is a $3,204,000 benefit as a result of a favorable ruling issued by the U.S. Court of Appeals for the Federal Circuit related to a legacy TCS intellectual property matter.

Interest expense in the tables above relate to our Prior Credit Facility and Credit Facility, and includes the amortization of deferred financing costs. In addition, during fiscal 2019, we recorded a $3,217,000 loss from the write-off of deferred financing costs primarily related to the Term Loan Facility portion of our Prior Credit Facility. See Note (8) - "Credit Facility" for further discussion.

Intersegment sales in fiscal 2020, 2019 and 2018 by the Commercial Solutions segment to the Government Solutions segment were $9,837,000, $17,371,000 and $9,630,000, respectively. There were nominal sales by the Government Solutions segment to the Commercial Solutions segment for these fiscal periods. All intersegment sales are eliminated in consolidation and are excluded from the tables above.

Unallocated assets at July 31, 2020 consist principally of cash and cash equivalents, income taxes receivable, corporate property, plant and equipment and deferred financing costs. Substantially all of our long-lived assets are located in the U.S.