SEGMENT INFORMATION AND GEOGRAPHIC DATA

9 Months Ended

Nov. 30, 2021

Segment Reporting [Abstract]

SEGMENT INFORMATION AND GEOGRAPHIC DATA

NOTE 15 - SEGMENT INFORMATION AND GEOGRAPHIC DATA

We operate under two reportable segments: Telematics Products and Software & Subscription Services. Our organizational structure is based on a number of factors that our CEO, the Chief Operating Decision Maker (“CODM”), uses to evaluate and operate the business, which include customer base, homogeneity of products, and technology for the fiscal years presented.

Our Software & Subscription Services segment offers cloud-based, application enablement and telematics service platforms that facilitate integration of our own applications, as well as those of third parties, through open Application Programing Interfaces (“APIs”) to deliver full-featured IoT solutions to a wide range of customers and markets. Our scalable proprietary SaaS offerings enable rapid and cost-effective deployment of high-value solutions for customers all around the globe. Software & Subscription Services segment revenues include SaaS, professional services, devices sold with monitoring services and amortization of revenues and costs for customized devices functional only with application subscriptions that are not sold separately.

Our Telematics Products segment offers a portfolio of wireless data communications products, which includes asset tracking units, mobile telematics devices, fixed and mobile wireless gateways and routers. These wireless networking devices underpin a wide range of our own, as well as third-party software and service solutions worldwide and are critical for applications demanding secure, reliable and business-critical communications. Telematics Product segment revenues consist primarily of stand-alone product sales.

Segment information is as follows (in thousands):

	Three Months Ended November 30, 2021												Three Months Ended November 30, 2020
	Reportable Segments												Reportable Segments
	Software & Subscription Services			Telematics Products			Corporate Expenses			Total			Software & Subscription Services			Telematics Products			Corporate Expenses			Total
Revenues	$	36,602		$	32,175					$	68,777		$	34,052		$	44,460					$	78,512
Gross profit	$	18,128		$	9,892					$	28,020		$	17,225		$	14,013					$	31,238
Gross margin		50	%		31	%					41	%		51	%		32	%					40	%
Adjusted EBITDA	$	6,699		$	(2,808	)	$	(900	)	$	2,991		$	9,004		$	869		$	(1,010	)	$	8,863

	Nine Months Ended November 30, 2021												Nine Months Ended November 30, 2020
	Reportable Segments												Reportable Segments
	Software & Subscription Services			Telematics Products			Corporate Expenses			Total			Software & Subscription Services			Telematics Products			Corporate Expenses			Total
Revenues	$	113,079		$	114,383					$	227,462		$	95,265		$	131,375					$	226,640
Gross profit	$	56,282		$	37,555					$	93,837		$	47,572		$	40,233					$	87,805
Gross margin		50	%		33	%					41	%		50	%		31	%					39	%
Adjusted EBITDA	$	22,231		$	446		$	(3,000	)	$	19,677		$	23,172		$	2,358		$	(3,328	)	$	22,202

The amount shown for each period in the “Corporate Expenses” column above consists of expenses that are not allocated to the business segments. These non-allocated corporate expenses include salaries and benefits of certain corporate staff and expenses such as audit fees, investor relations, stock listing fees, director and officer liability insurance, and director fees and expenses.

Our CODM evaluates each segment based primarily on revenue and Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”), and we therefore consider Adjusted EBITDA to be a primary measure of operating performance of our reportable segments. We define Adjusted EBITDA as earnings before investment income, interest expense, taxes, depreciation, amortization, stock-based compensation, impairment loss and other adjustments as identified below. The adjustments to our net income (losses) prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) to calculate Adjusted EBITDA are itemized below (in thousands):

	Three Months Ended November 30,						Nine Months Ended November 30,
	2021			2020			2021			2020
Net loss	$	(11,437	)	$	(23,680	)	$	(18,810	)	$	(47,580	)
Less: net income (loss) from discontinued operations		(895	)		(19,942	)	$	3,157		$	(29,644	)
Net loss from continuing operations	$	(10,542	)	$	(3,738	)	$	(21,967	)	$	(17,936	)
Investment income		(150	)		(584	)		(1,218	)		(1,282	)
Interest expense		3,830			3,880			11,483			11,814
Income tax provision		205			319			831			825
Depreciation		4,581			4,367			13,053			12,863
Amortization of intangible assets		1,386			1,201			4,033			3,567
Stock-based compensation		3,152			2,646			8,561			7,491
Restructuring charges		—			(100	)		336			1,917
Non-recurring legal expenses		213			205			1,332			1,168
Costs incurred in transition of LoJack North America business to acquiror		69			—			1,784			—
Other		247			667			1,449			1,775
Adjusted EBITDA	$	2,991		$	8,863		$	19,677		$	22,202

Our CODM does not obtain identifiable assets by segment because our businesses share resources, functions and facilities. We do not have significant long-lived assets outside the United States.

Revenues by geographic area are as follows (in thousands):

	Three Months Ended				Nine Months Ended
	November 30,				November 30,
	2021		2020		2021		2020
United States	$	44,613	$	51,323	$	150,133	$	146,192
EMEA		12,097		13,772		39,450		45,214
LATAM		5,537		7,349		19,687		19,078
APAC		5,760		5,017		15,534		11,597
All other		770		1,051		2,658		4,559
	$	68,777	$	78,512	$	227,462	$	226,640

Revenues by geographic area are based upon the country of billing. The geographic location of distributors and OEM customers may be different from the geographic location of the ultimate end users of the products and services provided by us. No single non-U.S. country accounted for more than 10% of our revenue in the three and nine months ended November 30, 2021 and 2020.