Segment Information

Effective with the beginning of fiscal 2018, we changed our segments, see Note 1. Basis of Presentation for additional information. We operate within a single industry segment -- computer software and related services. Operating segments as defined under GAAP are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Our chief operating decision maker is our President and Chief Executive Officer. We have two operating and reportable segments: (1) Software Products, which includes license, subscription and related support revenue (including updates and technical support) for all our products; and (2) Professional Services, which includes consulting, implementation and training services. We do not allocate sales & marketing or general and administrative expense to our operating segments as these activities are managed on a consolidated basis. Additionally, segment profit does not include stock-based compensation, amortization of intangible assets, restructuring charges and certain other identified costs that we do not allocate to the segments for purposes of evaluating their operational performance.

The revenue and profit attributable to our operating segments are summarized below. We do not produce asset information by reportable segment; therefore, it is not reported.



	Three months ended						Six months ended
	March 31, 2018			April 1, 2017			March 31, 2018			April 1, 2017
	(in thousands)
Software Products
Revenue	$	262,453		$	234,870		$	527,643		$	475,089
Operating Costs (1)	97,306			88,832			196,995			178,871
Profit	165,147			146,038			330,648			296,218

Professional Services
Revenue	45,430			45,170			86,884			91,278
Operating Costs (2)	35,909			37,269			70,689			75,093
Profit	9,521			7,901			16,195			16,185

Total segment revenue	307,883			280,040			614,527			566,367
Total segment costs	133,215			126,101			267,684			253,964
Total segment profit	174,668			153,939			346,843			312,403

Unallocated operating expenses:
Sales and marketing expenses	93,292			83,647			187,728			170,716
General and administrative expenses	27,382			25,957			54,814			54,007
Restructuring and headquarters relocation charges, net	114			464			219			6,749
Intangibles amortization	14,451			14,335			28,947			28,790
Stock-based compensation	17,026			21,577			35,357			39,565
Other unallocated operating expenses (3)	37			446			(60		)	502
Total operating income	22,366			7,513			39,838			12,074

Interest expense	(10,379		)	(11,725		)	(20,426		)	(22,040		)
Interest income and other expense, net	(441		)	3,156			(1,395		)	2,407
Income (loss) before income taxes	$	11,546		$	(1,056	)	$	18,017		$	(7,559	)
(1) Operating costs for the Software Products segment includes all cost of software revenue and research and development costs, excluding stock-based compensation and intangible amortization.
(2) Operating costs for the Professional Services segment includes all cost of professional services revenue, excluding stock-based compensation, intangible amortization, and fair value adjustments for deferred services costs.
(3) Other unallocated operating expenses include acquisition-related costs and fair value adjustments for deferred services costs.