Segment Information & Geographic Data

12 Months Ended

Dec. 31, 2022

Segment Reporting [Abstract]

Segment Information & Geographic Data

Segment Information & Geographic Data

Segment results

The Company’s operations consist of two reportable segments: Asset Intelligence & Tracking (“AIT”) and Enterprise Visibility & Mobility (“EVM”). The reportable segments have been identified based on the financial data utilized by the Company’s Chief Executive Officer (the chief operating decision maker or “CODM”) to assess segment performance and allocate resources among the Company’s segments. The CODM reviews adjusted operating income to assess segment profitability. To the extent applicable, segment operating income excludes business acquisition purchase accounting adjustments, amortization of intangible assets, acquisition and integration costs, impairment of goodwill and other intangibles, exit and restructuring costs, as well as certain other non-recurring costs (such as the Settlement in the current year). Segment assets are not reviewed by the Company’s CODM and therefore are not disclosed below.

Effective January 1, 2022, the location solutions offering, which provides a range of RTLS and services that generate on-demand information about the physical location and status of assets, equipment, and people, moved from our AIT segment into our EVM segment contemporaneous with a change in our organizational structure and management of the business. We have reported our results reflecting this change, including historical periods, on a comparable basis. This change did not have an impact to the Consolidated Financial Statements.

Financial information by segment is presented as follows (in millions):

	Year Ended December 31,
	2022		2021		2020
Net sales:
AIT	$	1,736	$	1,657	$	1,369
EVM	4,045		3,976		3,086
Total segment Net sales	5,781		5,633		4,455
Corporate eliminations(1)	—		(6)		(7)
Total Net sales	$	5,781	$	5,627	$	4,448
Operating income:
AIT(2)	$	360	$	382	$	331
EVM(2)	712		750		457
Total segment operating income	1,072		1,132		788
Corporate eliminations(1)	(543)		(153)		(137)
Total Operating income	$	529	$	979	$	651

(1)To the extent applicable, amounts included in Corporate eliminations consist of business acquisition purchase accounting adjustments, amortization of intangible assets, acquisition and integration costs, impairment of goodwill and other intangibles, exit and restructuring costs, as well as certain other non-recurring costs (such as the Settlement in the current year).

(2)AIT and EVM segment operating income includes depreciation and share-based compensation expense. The amounts of depreciation and share-based compensation expense are proportionate to each segment’s Net sales.

Sales to significant customers

The Company has three customers, who are distributors of the Company’s products and solutions, that individually accounted for more than 10% of total Company Net sales during the years ended December 31, 2022, 2021 and 2020. The approximate percentage of our segment and Company total Net sales to these customers were as follows:

	Year Ended December 31,
	2022						2021						2020
	AIT		EVM		Total		AIT		EVM		Total		AIT		EVM		Total
Customer A	7.2	%	13.5	%	20.7	%	7.3	%	15.0	%	22.3	%	6.5	%	14.2	%	20.7	%
Customer B	5.7	%	9.3	%	15.0	%	5.1	%	8.5	%	13.6	%	4.9	%	9.0	%	13.9	%
Customer C	3.7	%	9.1	%	12.8	%	3.1	%	9.5	%	12.6	%	4.8	%	12.9	%	17.7	%

These customers accounted for 21.7%, 19.5%, and 17.8%, respectively, of accounts receivable as of December 31, 2022, and 22.7%, 13.4% and 14.8%, respectively, of accounts receivable as of December 31, 2021. No other customer accounted for more than 10% of total Net sales during the years ended December 31, 2022, 2021 or 2020, or more than 10% of outstanding accounts receivable as of December 31, 2022 or 2021.

Geographic data

Information regarding the Company’s operations by geographic area is contained in the following tables. Net sales amounts are attributed to geographic area based on customer location.

Net sales by region were as follows (in millions):

	Year Ended December 31,
	2022		2021		2020
North America	$	2,919	$	2,819	$	2,319
EMEA	1,920		1,976		1,495
Asia-Pacific	609		543		439
Latin America	333		289		195
Total Net sales	$	5,781	$	5,627	$	4,448

The U.S. and Germany were the only countries that accounted for more than 10% of the Company’s net sales in 2022, 2021, and 2020. Net sales during these years were as follows (in millions):

	Year Ended December 31,
	2022		2021		2020
U.S.	$	2,840	$	2,784	$	2,291
Germany	949		901		595
Other	1,992		1,942		1,562
Total Net sales	$	5,781	$	5,627	$	4,448

Geographic data for long-lived assets is as follows (in millions):

	Year Ended December 31,
	2022		2021		2020
North America	$	336	$	290	$	289
EMEA	58		68		68
Asia-Pacific	35		39		45
Latin America	5		6		7
Total long-lived assets	$	434	$	403	$	409

Long-lived assets are defined by the Company as property, plant and equipment and ROU assets. Primarily all of the Company’s long-lived assets in the North America region are located in the U.S.