Quarterly report pursuant to Section 13 or 15(d)

Interim Segment Information (Notes)

v3.7.0.1
Interim Segment Information (Notes)
 3 Months Ended
Jun. 30, 2017
Segment Reporting [Abstract]  
Interim Segment Information
Interim Segment Information
Segment information is presented in accordance with a “management approach", which designates the internal reporting used by the chief operating decision-maker (CODM) for making decisions and assessing performance as the source of the Company's reportable segments. Westell’s Chief Executive Officer is the CODM. The CODM continues to define segment profit as gross profit less research and development expenses. The accounting policies of the segments are the same as those for Westell Technologies, Inc. described in the summary of significant accounting policies included in the Company's Annual Report on Form 10-K for year ended March 31, 2017.
The Company’s three reportable segments are as follows:
In-Building Wireless (IBW) Segment
The IBW segment solutions enable cellular coverage in stadiums, arenas, malls, buildings, and other indoor areas not served well or at all by the existing "macro" outdoor cellular network. For commercial service, the IBW segment solutions include distributed antenna systems (DAS) conditioners and digital repeaters. For the public safety market, the IBW segment solutions include half-watt and two-watt repeaters and a battery backup unit. The Company’s IBW segment also offers ancillary products that consist of passive system components and antennas for both the commercial and public safety markets.
Intelligent Site Management and Services (ISMS) Segment
The ISMS segment solutions include a suite of remote units which provide machine-to-machine (M2M) communications that enable operators to remotely monitor, manage, and control site infrastructure and support systems. Remote units can be and often are combined with the Company’s Optima management software system. The Company also offers support agreement services (i.e., maintenance) and deployment services (i.e., installation).
Communications Network Solutions (CNS) Segment
The CNS segment solutions include a broad range of outdoor network infrastructure offerings consisting of integrated cabinets, power distribution products, copper and fiber connectivity panels, T1 network interface units (NIUs), and tower mounted amplifiers (TMAs).
Segment information for the three months ended June 30, 2017, and 2016, is set forth below: 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended June 30, 2017
 
(in thousands)
 
IBW
 
ISMS
 
CNS
 
Total
 
Revenue
 
$
6,956

 
$
4,130

 
$
5,488

 
$
16,574

 
Cost of revenue
 
3,942


2,004

 
3,861

 
9,807

 
Gross profit
 
3,014

 
2,126

 
1,627

 
6,767

 
Gross margin
 
43.3
%
 
51.5
%
 
29.6
%
 
40.8
%
 
Research and development
 
1,463

 
565

 
248

 
2,276

 
Segment profit
 
$
1,551

 
$
1,561

 
$
1,379

 
4,491

 
Operating expenses:
 
 
 
 
 
 
 
 
 
Sales and marketing
 
 
 
 
 
 
 
2,336

 
General and administrative
 
 
 
 
 
 
 
1,711

 
Intangible amortization
 
 
 
 
 
 
 
1,047

 
Restructuring
 
 
 
 
 
 
 
—

 
Long-lived assets impairment
 
 
 
 
 
 
 
—

 
Operating profit (loss)
 
 
 
 
 
 
 
(603
)
 
Other income (expense), net
 
 
 
 
 
 
 
43

 
Income tax benefit (expense)
 
 
 
 
 
 
 
(12
)
 
Net income (loss)
 
 
 
 
 
 
 
$
(572
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended June 30, 2016
 
(in thousands)
 
IBW
 
ISMS
 
CNS
 
Total
 
Revenue
 
$
6,121

 
$
4,139

 
$
4,556

 
$
14,816

 
Cost of revenue
 
5,127

(1) 
2,120

 
3,004

 
10,251

(1) 
Gross profit
 
994

(1) 
2,019

 
1,552

 
4,565

(1) 
Gross margin
 
16.2
%
(1) 
48.8
%
 
34.1
%
 
30.8
%
(1) 
Research and development
 
2,364

 
1,294

 
619

 
4,277

 
Segment profit (loss)
 
$
(1,370
)
 
$
725

 
$
933

 
288

 
Operating expenses:
 
 
 
 
 
 
 
 
 
Sales and marketing
 
 
 
 
 
 
 
3,381

 
General and administrative
 
 
 
 
 
 
 
2,345

 
Intangible amortization
 
 
 
 
 
 
 
1,200

 
Restructuring
 
 
 
 
 
 
 
(36
)
 
Long-lived assets impairment
 
 
 
 
 
 
 
1,181

 
Operating profit (loss)
 
 
 
 
 
 
 
(7,783
)
 
Other income (expense), net
 
 
 
 
 
 
 
17

 
Income tax benefit (expense)
 
 
 
 
 
 
 
(2
)
 
Net income (loss) from continuing operations
 
 
 
 
 
 
 
$
(7,768
)
 


(1) The three months ended June 30, 2016, includes E&O expense for ClearLink DAS inventory and pipeline inventory. See Note 2, Restructuring Charges.

Segment asset information is not reported to or used by the CODM.