Quarterly report pursuant to Section 13 or 15(d)

Interim Segment Information (Notes)

v3.20.2
Interim Segment Information (Notes)
 3 Months Ended
Jun. 30, 2020
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, 2020, and as updated in this filing.
The Company’s three reportable segments are as follows:
In-Building Wireless (“IBW") Segment
The IBW segment solutions enable cellular and public safety coverage in stadiums, arenas, malls, buildings, and other indoor areas not served well or at all by the existing "macro" outdoor wireless network. For cellular service, solutions include distributed antenna system (“DAS") conditioners and digital repeaters. For the public safety market, solutions include Class A repeaters, Class B repeaters, and battery backup units. IBW also offers ancillary products that consist of passive system components and antennas for both the cellular service and public safety markets.
Intelligent Site Management (“ISM") Segment
ISM segment solutions include a suite of remote units, which provide machine-to-machine (“M2M") communications that enable operators to remotely monitor, manage, and control physical site infrastructure and support systems. Remote units can be and often are combined with the Company's Optima management software system. ISM also offers support services (i.e., maintenance agreements) and deployment services (i.e., installation).
Communications Network Solutions (“CNS") Segment
CNS segment solutions include a broad range of hardened network infrastructure offerings suitable for both indoor and outdoor use.  The offerings consist of integrated cabinets, power distribution products, copper and fiber network connectivity panels, and T1 network interface units (“NIUs").
Segment information for the three months ended June 30, 2020, and 2019, is set forth below: 
 
 
Three months ended June 30, 2020
(in thousands)
 
IBW
 
ISM
 
CNS
 
Total
Revenue
 
$
2,949

 
$
2,047

 
$
2,354

 
$
7,350

Cost of revenue
 
1,749


892

 
1,867

 
4,508

Gross profit
 
1,200

 
1,155

 
487

 
2,842

Gross margin
 
40.7
%
 
56.4
%
 
20.7
%
 
38.7
%
Research and development
 
349

 
382

 
214

 
945

Segment profit
 
$
851

 
$
773

 
$
273

 
1,897

Operating expenses:
 
 
 
 
 
 
 
 
Sales and marketing
 
 
 
 
 
 
 
1,376

General and administrative
 
 
 
 
 
 
 
1,210

Intangible amortization
 
 
 
 
 
 
 
226

Operating profit (loss)
 
 
 
 
 
 
 
(915
)
Other income, net
 
 
 
 
 
 
 
30

Income tax benefit (expense)
 
 
 
 
 
 
 
60

Net income (loss)
 
 
 
 
 
 
 
$
(825
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended June 30, 2019
(in thousands)
 
IBW
 
ISM
 
CNS
 
Total
Revenue
 
$
2,923

 
$
3,095

 
$
2,984

 
$
9,002

Cost of revenue
 
1,951

 
1,516

 
2,289

 
5,756

Gross profit
 
972

 
1,579

 
695

 
3,246

Gross margin
 
33.3
%

51.0
%
 
23.3
%
 
36.1
%
Research and development
 
399

 
701

 
456

 
1,556

Segment profit
 
$
573

 
$
878

 
$
239

 
1,690

Operating expenses:
 
 
 
 
 
 
 
 
Sales and marketing
 
 
 
 
 
 
 
2,332

General and administrative
 
 
 
 
 
 
 
1,364

Intangible amortization
 
 
 
 
 
 
 
308

Operating profit (loss)
 
 
 
 
 
 
 
(2,314
)
Other income, net
 
 
 
 
 
 
 
164

Income tax benefit (expense)
 
 
 
 
 
 
 
(7
)
Net income (loss)
 
 
 
 
 
 
 
$
(2,157
)


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