GEOSPACE TECHNOLOGIES CORP Segments Disclosure

21. Segment and Geographic Information

 

Effective October 1, 2024, the Company changed the composition of its three operating business segments and changed its methodology for allocating manufacturing costs including overhead and other costs of revenue to the segments. 

 

The Company's business segments are now comprised of: Smart Water, Energy Solutions and Intelligent Industrial. The Smart Water segment emphasizes the Company’s targeted approach in the water management industry. This business segment contains the Hydroconn® smart water connectivity offerings and the Company's Aquana products. The Energy Solutions segment encompasses the Company’s traditional business in oil and gas land and marine exploration products, reservoir monitoring solutions, and will additionally incorporate emerging energy solutions and microseismic monitoring. This segment will include energy-related business from Quantum’s SADAR® products and associated analytics.  The Intelligent Industrial segment includes seismic sensor products used for vibration monitoring geotechnical applications such as mine safety applications and earthquake detection, seismic products targeted at the border and perimeter security markets, imaging products, as well as providing contract manufacturing services. The change in methodology for allocating manufacturing costs affected each business segment's operating income (loss) but had no effect on consolidated operating income (loss).  

 

The Company defines its segments as those operations our chief operating decision maker (“CODM”) regularly reviews to analyze performance and allocate resources. The Company’s CODM is the Chief Executive Officer. The CODM regularly reviews revenue, gross profit, operating expenses and operating income (loss) by segment as the primary measures of segment performance. The CODM reviews revenue as a primary indicator of operational performance, assessing how much revenue is brought in from core business activities, which reflects demand and execution of each segment’s strategy. Gross profit is reviewed by the CODM as a diagnostic metric, particularly useful in evaluating margin trends. Operating income is the key profitability metric used to assess performance across segments and make decisions related to resource allocation, including capital expenditures, headcount, and other investment initiatives. Each of these metrics is considered in budgeting, forecasting, and operational planning decisions.

 

For financial reporting purposes, we are organized into these reportable segments and “Corporate”, which includes the remainder of our businesses.  The following table summarizes the Company’s segment information (in thousands).  Segment information for the fiscal year ended September 30, 2024 has been recast for comparability.

 

		YEAR ENDED SEPTEMBER 30,
		2025				2024
Revenue:
Smart Water		$	35,816			$	32,434
Energy Solutions			50,706				77,977
Intelligent Industrial			23,960				24,891
Corporate			321				296
		110,803				135,598
Cost of revenue:
Smart Water			21,106				16,653
Energy Solutions			36,580				46,922
Intelligent Industrial			20,082				19,335
Corporate			138				115
		77,906				83,025
Gross profit:
Smart Water			14,710				15,781
Energy Solutions			14,126				31,055
Intelligent Industrial			3,878				5,556
Corporate			183				181
		32,897				52,573
Operating expenses:
Smart Water			9,047				6,566
Energy Solutions			13,738				12,485
Intelligent Industrial			8,207				12,247
Corporate			17,805				14,158
		48,797				45,456
Gain on disposal of property:
Corporate			4,616				—
Income (loss) from operations:
Smart Water			5,663				9,215
Energy Solutions			388				18,570
Intelligent Industrial			(4,329	)			(6,691	)
Corporate			(13,006	)			(13,977	)
		(11,284		)		7,117
Other segment disclosures:
Interest income:
Smart Water			—				315
Energy Solutions			1,694				—
Intelligent Industrial			—				—
Corporate			843				1,243
		2,537				1,558
Interest expense:
Smart Water			—				17
Energy Solutions			23				—
Corporate			146				170
		169				187
Depreciation and amortization expenses:
Smart Water			1,145				482
Energy Solutions			7,333				13,243
Intelligent Industrial			1,049				653
Corporate			619				388
		10,146				14,766
Impairment, inventory obsolescence and stock-based compensation expenses:
Smart Water			31				189
Energy Solutions			2,618				993
Intelligent Industrial			907				2,830
Corporate			1,020				642
		4,576				4,654

 

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The Company’s manufacturing operations for its business segments are combined. Therefore, the Company does not segregate and report separate balance sheet accounts for each of its segments and, therefore, no such segment balance sheet information is presented in the table above.

 

“Corporate” expense from operations primarily consists of the Company’s Houston headquarters general and administrative expenses.

 

The Company generates revenue from product sales, product rentals and services from its subsidiaries located in the United States, Canada, Colombia, the Russian Federation (sold in August 2024) and the United Kingdom. Revenue generated by the Company’s subsidiaries is as follows (in thousands):

 

		YEAR ENDED SEPTEMBER 30,
		2025				2024
United States		$	106,603			$	127,488
Canada			1,552				1,777
Russian Federation			—				3,487
United Kingdom			2,648				2,846
		$	110,803			$	135,598

 

A summary of revenue by geographic area is as follows (in thousands):

 

		YEAR ENDED SEPTEMBER 30,
		2025				2024
Asia (including Russian Federation)		$	26,552			$	51,103
Canada			2,931				2,015
Europe			5,067				13,817
Mexico			2,746				1,959
South America			3,146				2,798
United States			69,291				63,061
Other			1,070				845
		$	110,803			$	135,598

 

Revenue is attributed to countries based on the ultimate destination of the product sold, if known. If the ultimate destination is not known, revenue is attributed to countries based on the geographic location of the initial shipment.

 

Long-lived asset balances are as follows (in thousands):

 

		AS OF SEPTEMBER 30,
		2025				2024
United States		$	63,332			$	61,487
Canada			366				414
Colombia			392				399
United Kingdom			447				528
		$	64,537			$	62,828