Segment and Geographic Information

12 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Segment and Geographic Information

18. Segment and Geographic 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 and 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.

(in thousands)	Year ended September 30,
	As reported ASC 606			As reported ASC 606			ASC 605			As reported ASC 605
	2020			2019			2019			2018
Software Products
Revenue	$	1,314,617		$	1,088,100		$	1,150,818		$	1,088,487
Operating costs(1)		393,803			377,464			375,268			387,989
Profit		920,814			710,636			775,550			700,498
Professional Services
Revenue		143,798			167,531			160,676			153,337
Operating costs(2)		128,678			133,846			128,818			136,964
Profit		15,120			33,685			31,858			16,373
Total segment revenue		1,458,415			1,255,631			1,311,494			1,241,824
Total segment costs		522,481			511,310			504,086			524,953
Total segment profit		935,934			744,321			807,408			716,871
Unallocated operating expenses:(3)
Sales and marketing expenses		398,100			385,423			409,932			389,871
General and administrative expenses		114,386			104,393			104,393			108,159
Intangibles amortization		56,104			51,147			51,147			58,056
Restructuring and other charges, net		32,716			51,114			51,114			3,764
Stock-based compensation		115,149			86,400			86,400			82,939
Other unallocated operating expenses(4)		8,616			2,802			2,802			1,469
Total operating income		210,863			63,042			101,620			72,613
Interest expense		(76,428	)		(43,047	)		(43,047	)		(41,673	)
Other income (expense), net		271			305			131			(2,284	)
Income before income taxes	$	134,706		$	20,300		$	58,704		$	28,656

(1) Operating costs for the Software Products segment include all costs of software revenue and research and development costs, excluding stock-based compensation and intangible amortization. Operating costs for the Software Products segment include depreciation of $4.2 million, $4.6 million and $5.1 million in 2020, 2019 and 2018, respectively.

(2) Operating costs for the Professional Services segment include all costs of professional services revenue, excluding stock-based compensation, intangible amortization, and fair value adjustments for deferred services costs. The Professional Services segment includes depreciation of $1.1 million, $1.4 million and $1.6 million in 2020, 2019 and 2018, respectively.

(3) Unallocated departments include depreciation of $19.4 million, $20.6 million and $22.7 million in 2020, 2019 and 2018, respectively.

(4) Other unallocated operating expenses include acquisition-related and other transactional costs and fair value adjustments for deferred services costs.

We report revenue by the following three product groups:

(in thousands)	Year ended September 30,
	As reported ASC 606		As reported ASC 606		ASC 605		As reported ASC 605
	2020		2019		2019		2018
Core	$	1,025,668	$	868,970	$	921,386	$	895,149
Growth		222,646		167,544		175,619		139,278
Focused Solutions Group (FSG)		210,101		219,117		214,489		207,397
Total revenue	$	1,458,415	$	1,255,631	$	1,311,494	$	1,241,824

We license products to customers worldwide. Our sales and marketing operations outside the United States are conducted principally through our international sales subsidiaries throughout Europe and the Asia Pacific region. Intercompany sales and transfers between geographic areas are accounted for at prices that are designed to be representative of unaffiliated party transactions. Our international revenue is presented based on the location of our customer. Revenue for the geographic regions in which we operate is presented below.

(in thousands)	Year ended September 30,
	As reported ASC 606		As reported ASC 606		ASC 605		As reported ASC 605
	2020		2019		2019		2018
Revenue:
Americas(1)	$	649,383	$	537,548	$	565,362	$	511,237
Europe(2)		543,779		464,666		494,864		485,851
Asia Pacific		265,253		253,417		251,268		244,736
Total revenue	$	1,458,415	$	1,255,631	$	1,311,494	$	1,241,824

(1) Includes revenue in the United States totaling $621.8 million, $514.4 million (ASC 606) and $541.7 million (ASC 605), and $487.3 million for 2020, 2019 and 2018, respectively.

(2) Includes revenue in Germany totaling $198.7 million, $185.4 million (ASC 606) and $197.2 million (ASC 605), and $193.3 million for 2020, 2019 and 2018, respectively.