Quarterly report pursuant to Section 13 or 15(d)

Interim Segment Information (Notes)

v3.3.1.900
Interim Segment Information (Notes)
 9 Months Ended
Dec. 31, 2015
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.
The Company’s two reportable segments are as follows:
In-Building Wireless (IBW) Segment
The IBW segment solutions include distributed antenna systems (DAS) conditioners, high-performance digital repeaters and bi-directional amplifiers (BDAs), and system components and antennas, all used by wireless service providers and neutral-party hosts to fine tune radio frequency (RF) signals that helps extend coverage to areas not served well or at all by traditional cell sites.
Communication Solutions Group (CSG) Segment
The CSG segment solutions include intelligent site management (ISM), cell site optimization (CSO), and outside plant (OSP) as follows:
• ISM solutions include a suite of Remote monitoring and control devices which, when combined with the Company's Optima management system, provides comprehensive machine-to-machine (M2M) communications that enable operators to remotely monitor, manage, and control site infrastructure and support systems.
• CSO solutions consist of tower mounted amplifiers (TMAs), small outdoor-hardened units mounted next to antennas on cell towers, enabling wireless service providers to improve the overall performance of a cell site, including increasing data throughput and reducing dropped connections.
• OSP solutions, which are sold to wireline and wireless service providers as well as industrial network operators, consist of a broad range of offerings, including cabinets, enclosures, and mountings; synchronous optical networks/time division multiplexing (SONET/TDM) network interface units; power distribution units; copper and fiber connectivity panels; hardened Ethernet switches; and systems integration services.
Segment information for the three and nine months ended December 31, 2015, and 2014 is set forth below: 

 
 
Three months ended December 31, 2015
(in thousands)
 
IBW
 
CSG
 
Total
Revenue
 
$
8,680

 
$
11,535

 
$
20,215

Cost of revenue
 
5,361

 
6,891

 
12,252

Gross profit
 
3,319

 
4,644

 
7,963

Gross margin
 
38.2
%
 
40.3
%
 
39.4
%
Research and development
 
2,701

 
2,192

 
4,893

Segment profit (loss)
 
$
618

 
$
2,452

 
3,070

Operating expenses:
 
 
 
 
 
 
Sales and marketing
 
 
 
 
 
3,900

General and administrative
 
 
 
 
 
2,627

Intangible amortization
 
 
 
 
 
1,418

Restructuring
 
 
 
 
 
—

Operating income (loss)
 
 
 
 
 
(4,875
)
Other income (expense), net
 
 
 
 
 
85

Income tax benefit (expense)
 
 
 
 
 
(7
)
Net income (loss) from continuing operations
 
 
 
 
 
$
(4,797
)
 
 
 
 
 
 
 
 
 
Three months ended December 31, 2014
(in thousands)
 
IBW
 
CSG
 
Total
Revenue
 
$
5,414

 
$
8,629

 
$
14,043

Cost of revenue
 
3,504

 
6,144

 
9,648

Gross profit
 
1,910

 
2,485

 
4,395

Gross margin
 
35.3
%
 
28.8
%
 
31.3
%
Research and development
 
2,342

 
2,011

 
4,353

Segment profit (loss)
 
$
(432
)
 
$
474

 
42

Operating expenses:
 
 
 
 
 
 
Sales and marketing
 
 
 
 
 
2,719

General and administrative
 
 
 
 
 
2,797

Intangible amortization
 
 
 
 
 
1,562

Restructuring
 
 
 
 
 
—

Goodwill impairment
 
 
 
 
 
20,547

Operating income (loss)
 
 
 
 
 
(27,583
)
Other income (expense), net
 
 
 
 
 
(29
)
Income tax benefit (expense)
 
 
 
 
 
72

Net income (loss) from continuing operations
 
 
 
 
 
$
(27,540
)
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 
Nine months ended December 31, 2015
(in thousands)
 
IBW
 
CSG
 
Total
Revenue
 
$
28,569

 
$
38,730

 
$
67,299

Cost of revenue
 
16,702

 
23,974

 
40,676

Gross profit
 
11,867

 
14,756

 
26,623

Gross margin
 
41.5
%
 
38.1
%
 
39.6
%
Research and development
 
8,638

 
5,966

 
14,604

Segment profit (loss)
 
$
3,229

 
$
8,790

 
12,019

Operating expenses:
 
 
 
 
 


Sales and marketing
 
 
 
 
 
11,209

General and administrative
 
 
 
 
 
8,089

Intangible amortization
 
 
 
 
 
4,249

Restructuring
 
 
 
 
 
17

Operating income (loss)
 
 
 
 
 
(11,545
)
Other income (expense), net
 
 
 
 
 
62

Income tax benefit (expense)
 
 
 
 
 
75

Net income (loss) from continuing operations
 
 
 
 
 
$
(11,408
)
 
 
 
 
 
 
 
 
 
Nine months ended December 31, 2014
(in thousands)
 
IBW
 
CSG
 
Total
Revenue
 
$
30,632

 
$
34,882

 
$
65,514

Cost of revenue
 
18,543

 
24,827

 
43,370

Gross profit
 
12,089

 
10,055

 
22,144

Gross margin
 
39.5
%

28.8
%
 
33.8
%
Research and development
 
6,640

 
6,488

 
13,128

Segment profit (loss)
 
$
5,449

 
$
3,567

 
9,016

Operating expenses:
 
 
 
 
 


Sales and marketing
 
 
 
 
 
9,064

General and administrative
 
 
 
 
 
9,131

Intangible amortization
 
 
 
 
 
4,857

Restructuring
 
 
 
 
 
55

Goodwill impairment
 
 
 
 
 
31,997

Operating income (loss)
 
 
 


 
(46,088
)
Other income (expense), net
 
 
 
 
 
16

Income tax benefit (expense)
 
 
 
 
 
170

Net income (loss) from continuing operations
 
 
 


 
$
(45,902
)


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