Arlo Technologies, Inc.ARLO

Arlo Technologies, Inc. Segments Disclosure

10-KFiled Feb 27, 20262 min read
Segment and Geographic Information
Segment information

We operate as one operating and reportable segment. Our Chief Executive Officer (“CEO”) is identified as the Chief Operating Decision Maker (“CODM”), who reviews financial information presented on a consolidated basis and considers budget-to-actual variances quarterly for allocation of operating and capital resources and evaluation of financial performance. The CODM does not review segment assets at a different asset level and category. The consolidated net income (loss) is the measure of segment net income (loss) that is most consistent with U.S. GAAP.

The CODM is regularly provided with not only the consolidated expenses on the consolidated statements of operations and comprehensive income (loss), but also the significant segment expenses and other segment items as below:

 Year Ended December 31,
 202520242023
(In thousands)
Revenue$529,297 $510,886 $491,176 
Less:
Cost of revenue
296,456 323,382 323,613 
Operating expenses:
Personnel-related expense74,605 66,811 65,249 
Stock-based compensation58,513 64,632 44,415 
Outside professional services49,075 54,229 48,336 
Marketing expenditure19,381 18,925 17,910 
Credit card and in-app processing fee17,534 8,777 7,335 
Other segment items (1)
(4,403)596 750 
Depreciation and amortization2,090 2,456 4,056 
Interest expense378 490 373 
Provision for income taxes741 1,092 1,175 
Segment net income (loss)
$14,927 $(30,504)$(22,036)
Reconciliation of profit or loss:
Adjustments and reconciling items— — — 
Consolidated net income (loss)
$14,927 $(30,504)$(22,036)
_________________________
(1)Other segment items include corporate IT and facility overhead, freight out expense, workforce reduction costs, separation expense, litigation reserves, gain on early lease termination, interest income, foreign currency exchange gain (loss), net and others.
Geographic information for revenue

Revenue consists of subscriptions and services revenue and product sales, less allowances for estimated sales returns, price protection, end-user customer rebates, net changes in deferred revenue, and other channel sales incentives deemed to be a reduction of revenue per the authoritative guidance. Sales and usage-based taxes are excluded from revenue. For reporting purposes, revenue by geographic area is generally based upon the bill-to location of the customer. The following table presents revenue by geographic area.

 Year Ended December 31,
 202520242023
(In thousands)
United States$328,780 $256,737 $299,360 
Spain108,126 137,671 113,826 
Sweden46,766 49,648 29,502 
Other countries45,625 66,830 48,488 
Total$529,297 $510,886 $491,176 

Geographic information for long-lived assets

Long-lived assets include property and equipment, net and operating lease right-of-use assets, net. Our long-lived assets are based on the physical location of the assets. The following table presents long-lived assets by geographic area.

As of December 31,
20252024
(In thousands)
United States$20,242 $18,201 
Other countries2,111 2,262 
Total$22,353 $20,463 
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About Segments Disclosures

Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.

Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.

Other Available Disclosures

Income TaxesRevenueEarnings Per ShareFair ValuePP&EDebtCommitmentsNew Standards