Segment and Related Information

3 Months Ended

Mar. 31, 2022

Segment Reporting [Abstract]

Segment and Related Information

Segment and Related Information

We provide integrated information management solutions and services for the public sector.

We provide our software systems and services and appraisal services through seven business units, which focus on the following products:

•financial management, education and planning, regulatory and maintenance software solutions;

•financial management, municipal courts, planning, regulatory and maintenance software solutions;

•courts and justice and public safety software solutions;

•data and insights solutions;

•appraisal and tax software solutions, land and vital records management software solutions, and property appraisal services;

•development platform solutions including case management and business management processing; and

•NIC digital government and payments solutions.

In accordance with ASC 280-10, Segment Reporting, we report our results in two reportable segments. The Enterprise Software ("ES") reportable segment provides public sector entities with software systems and services to meet their information technology and automation needs for mission-critical “back-office” functions. The business units presented in the ES reportable segment are the following: financial management, education and planning, regulatory and maintenance software solutions; financial management, municipal courts, planning, regulatory and maintenance software solutions; courts and justice and public safety software solutions; data and insights solutions; and appraisal and tax software solutions, land and vital records management software solutions, and property appraisal services. The Platform Technologies ("PT") reportable segment provides public sector entities with software solutions to perform transaction processing, streamline data processing, and improve operations and workflows. The business units presented in the PT reportable segment are the following: NIC digital government and payments solutions and development platform solutions.

We evaluate performance based on several factors, of which the primary financial measure is business segment operating income. We define segment operating income for our business units as income before non-cash amortization of intangible assets associated with their acquisitions, interest expense and income taxes. Segment operating income includes intercompany transactions. The majority of intercompany transactions relate to contracts involving more than one unit and are valued based on the contractual arrangement. Corporate segment operating loss primarily consists of compensation costs for the executive management team, certain shared services staff, and share-based compensation expense for the entire company. Corporate segment operating income also includes revenues and expenses related to a company-wide user conference.

As of January 1, 2022, the appraisal and tax software solutions, land and vital records management software solutions, and property appraisal service business unit, which was previously reported in the Appraisal & Tax ("A&T") reportable segment, was moved to the ES reportable segment and the NIC digital government and payments solutions and development platform solutions moved to the PT reportable segment to reflect changes in the way in which management makes operating decisions, allocates resources, and manages the growth and profitability of the Company. As the result of the changes in our reportable segments, the former A&T and NIC reportable segments are no longer considered separate segments. Prior year amounts for the ES and PT reportable segments have been adjusted to reflect the segment change.

For the three months ended March 31, 2022	Enterprise Software		Platform Technologies		Corporate		Totals
Revenues
Software licenses and royalties	$	16,105	$	401	$	—	$	16,506
Subscriptions	120,316		125,127		—		245,443
Software services	42,649		18,848		—		61,497
Maintenance	110,695		6,334		—		117,029
Appraisal services	8,518		—		—		8,518
Hardware and other	7,115		—		—		7,115
Intercompany	5,589		—		(5,589)		—
Total revenues	$	310,987	$	150,710	$	(5,589)	$	456,108
Segment operating income (loss)	$	106,529	$	30,733	$	(53,459)	$	83,803

For the three months ended March 31, 2021	Enterprise Software		Platform Technologies		Corporate		Totals
Revenues
Software licenses and royalties	$	14,372	$	561	$	—	$	14,933
Subscriptions	99,329		3,150		—		102,479
Software services	42,417		5,223		—		47,640
Maintenance	109,469		9,643		—		119,112
Appraisal services	6,465		—		—		6,465
Hardware and other	4,158		15		—		4,173
Intercompany	5,276		—		(5,276)		—
Total revenues	$	281,486	$	18,592	$	(5,276)	$	294,802
Segment operating income (loss)	$	98,854	$	3,223	$	(50,493)	$	51,584

	Three Months Ended March 31,
Reconciliation of reportable segment operating income to the Company's consolidated totals:	2022		2021
Total segment operating income	$	83,803	$	51,584
Amortization of acquired software	(13,221)		(7,964)
Amortization of customer and trade name intangibles	(14,714)		(5,412)
Interest expense	(4,804)		(478)
Other income, net	364		566
Income before income taxes	$	51,428	$	38,296