Annual report pursuant to Section 13 and 15(d)

Business Segments Information

v2.4.0.8
Business Segments Information
12 Months Ended
Dec. 31, 2013
Segment Reporting [Abstract]  
Business Segment Information / Major Customers
Business Segment Information / Major Customers
The Company has two reportable segments: enterprise video content management software and disc publishing. The Company's enterprise video content management software segment allow organizations to capture, organize and distribute content across the extended enterprise to a wide variety of end points, including mobile devices. Qumu's video platform supports both live and on-demand streaming, and also incorporates secure download capabilities. The Company's disc publishing segment provides customers with solutions that archive, distribute and protect content on CDs, DVDs and Blu-ray Discs. The Company markets its products to customers in North America, Europe and Asia.
Management evaluates segment performance based on revenue and operating income (loss). The measurement of operating income (loss) excludes interest income and expense, other non-operating items and income taxes. The operating income (loss) for the Company’s enterprise video content management software and disc publishing segments include all the direct costs of each business. Beginning with the first quarter of fiscal 2013, the measurement of operating income (loss) by segment includes an allocation of corporate expenses incurred to support each reportable segment. Previously reported amounts included all corporate and other unallocated expenses in the disc publishing segment, a portion of which were incurred to support the enterprise video content management software segment. The Company revised the amounts previously reported in 2012 as operating income (loss) by segment to align to the current period's presentation. This realignment resulted in $3,067,000 of corporate and other unallocated expenses being allocated from the disc publishing segment to the enterprise video content management software segment for the year ended December 31, 2012, and had no effect on previously reported consolidated net revenues or consolidated operating income (loss). Given the timing of the Company's acquisition of Qumu, Inc. in October 2011 and the resulting inclusion of a partial year of financial results for that business, the Company did not revise the amounts previously reported in 2011 to reflect an allocation of corporate expenses from the disc publishing to the enterprise video content management software segment. The Company has not provided specific asset information by segment, as it is not regularly provided to the Company’s chief operating decision maker for review at a segment specific level.
Net revenue and operating income (loss) were as follows (in thousands):
Reportable Segments
 
Enterprise Video Content Management Software
 
Disc Publishing
 
Total
2013
 
 
 
 
 
 
Revenues
 
$
17,736

 
$
64,736

 
$
82,472

Operating income (loss) (1)
 
(16,090
)
 
6,405

 
(9,685
)
2012
 
 
 
 
 
 
Revenues
 
9,836

 
69,607

 
79,443

Operating income (loss) (1) (2)
 
(46,295
)
 
6,551

 
(39,744
)
2011
 
 
 
 
 
 
Revenues
 
1,760

 
81,874

 
83,634

Operating income (loss) (1) (3)
 
(5,211
)
 
9,659

 
4,448

1.
Operating loss for the enterprise video content management software segment in 2013, 2012 and 2011 includes amortization expense of $1.2 million, $1.7 million and $0.4 million respectively, for amortization of intangible assets established as part of the acquisition of Qumu, Inc.
2.
Operating loss for the enterprise video content management software segment includes recognized asset impairment charges consisting of $22.2 million of goodwill and $7.3 million of other intangible assets for 2012. See Note 8, “Goodwill and Intangible Assets,” for additional information regarding the Company’s intangible assets.
3.
Operating income for the disc publishing segment in 2011 includes $1.7 million of nonrecurring transaction costs associated with the acquisition of Qumu, Inc.
The following represents sales amounts and related accounts receivable balances generated by the Company’s unaffiliated customers that provided more than 10% of consolidated revenues (in thousands):
 
 
Years Ended December 31,
Revenues
 
2013
 
2012
 
2011
Customer A
 
$
9,551

 
$
8,044

 
$
13,667

 
 
December 31,
Accounts Receivable
 
2013
 
2012
 
2011
Customer A
 
$
348

 
$
369

 
$
430


The Company’s revenues from each of its principal geographic regions are presented based on customer location as follows (in thousands):
 
 
Years Ended December 31,
 
 
2013
 
2012
 
2011
North America
 
$
52,871

 
$
51,413

 
$
51,706

Europe
 
21,980

 
19,414

 
22,083

Other (Asia and Latin America)
 
7,621

 
8,616

 
9,845

Total
 
$
82,472

 
$
79,443

 
$
83,634


Net property and equipment of the Company were located as follows (in thousands):
 
 
December 31,
 
 
2013
 
2012
North America
 
$
5,070

 
$
5,553

Europe
 
316

 
356

Asia
 
33

 
57

Total
 
$
5,419

 
$
5,966


The Company’s revenues from each of its principal products and services were as follows (in thousands):
 
Years Ended December 31,
 
2013
 
2012
 
2011
 
Enterprise video content management software
 
 
 
 
 
 
Software licenses and appliances
$
7,269

9
%
$
4,320

5
%
$
693

1
%
Service
10,467

13
%
5,516

7
%
1,067

1
%
Total enterprise video content management software
17,736

22
%
9,836

12
%
1,760

2
%
Disc publishing
 
 
 
 
 
 
Disc publishing equipment:
 
 
 
 
 
 
Producer
9,119

11
%
12,285

15
%
15,788

19
%
Professional
6,609

8
%
9,517

12
%
11,939

14
%
Desktop
1,575

2
%
1,977

2
%
2,697

3
%
Total disc publishing equipment
17,303

21
%
23,779

30
%
30,424

36
%
Recurring:
 
 
 
 
 
 
Consumables and parts
34,962

42
%
33,819

43
%
40,038

48
%
Service
12,471

15
%
12,009

15
%
11,412

14
%
Total recurring
47,433

58
%
45,828

58
%
51,450

62
%
Total disc publishing
64,736

78
%
69,607

88
%
81,874

98
%
Total revenue
$
82,472

100
%
$
79,443

100
%
$
83,634

100
%