HARTE HANKS INCHHS

HARTE HANKS INC Segments Disclosure

10-KFiled Mar 17, 20263 min read
Segment Reporting
Harte Hanks is a leading global customer experience company. Based on the types of products and services we provide, we have organized our operations into three business segments: Revenue Solutions formerly known as Marketing Services, Customer Care, and Fulfillment and Logistics.
There are three principal financial measures reported to our President (the chief operating decision maker) for use in assessing segment performance and allocating resources. Those measures are revenue, operating income and operating income plus depreciation and amortization (“EBITDA”), which is a non-GAAP measure. Operating income for segment reporting, disclosed below, is revenues less operating costs and allocated corporate expenses. Segment operating expenses are generally directly attributed to our segments and include allocations of certain centrally incurred costs such as employee benefits, occupancy, information systems, accounting services, internal legal staff, and human resources administration. These costs are allocated based on actual usage or other appropriate methods. Unallocated corporate expenses are corporate overhead expenses not attributable to the operating groups. Interest income and expense are not allocated to the segments. The Company does not allocate assets to our reportable segments for internal reporting purposes, nor does our President evaluate operating segments using discrete asset information. The accounting policies of the segments are consistent with those described in Note B, Significant Accounting Policies.
SEC Regulation S-K 229.10(e)1(ii)(A) defines EBITDA as earnings before interest, taxes, depreciation and amortization. EBITDA is presented to provide additional information to investors about the Company’s operations on a basis consistent with the measures that the Company uses to manage its operations and evaluate its performance. Management also uses this measurement to evaluate working capital requirements. EBITDA should not be considered in isolation or as a substitute for operating income and net income prepared in accordance with GAAP or as a measure of the Company’s profitability.
The following table presents financial information by segment year ended December 31, 2025:
(In thousands)Revenue SolutionsCustomer CareFulfillment & LogisticsRestructuringUnallocated CorporateTotal
Operating revenue
$35,128 $50,067 $74,375 $— $— $159,570 
Segment labor expense18,058 32,567 19,445 — 10,753 80,823 
Other segment operating expense8,868 8,218 45,268 — 9,753 72,107 
Restructuring expense— — — 1,782 — 1,782 
Contribution margin$8,202 $9,282 $9,662 $(1,782)$(20,506)$4,858 
Overhead Allocation2,618 3,037 3,111 — (8,766)— 
EBITDA (unaudited)$5,584 $6,245 $6,551 $(1,782)$(11,740)$4,858 
Depreciation and amortization expense797 266 2,214 — 1,195 4,472 
Operating income (loss)$4,787 $5,979 $4,337 $(1,782)$(12,935)$386 
The following table presents financial information by segment year ended December 31, 2024:
(In thousands)Revenue SolutionsCustomer CareFulfillment & LogisticsRestructuringUnallocated CorporateTotal
Operating revenue
$50,332 $52,918 $81,992 $— $— $185,242 
Segment labor expense26,440 34,175 20,263 — 12,891 93,769 
Other segment operating expense11,468 6,260 52,770 — 8,927 79,425 
Restructuring expense— — — 2,402 — 2,402 
Contribution margin$12,424 $12,483 $8,959 $(2,402)$(21,818)$9,646 
Overhead allocation4,074 2,355 3,198 — (9,627)— 
Goodwill and intangible assets impairment charges3,168 — — — — 3,168 
EBITDA (unaudited)$5,182 $10,128 $5,761 $(2,402)$(12,191)$6,478 
Depreciation and amortization expense1,459 207 1,256 — 1,463 4,385 
Operating income (loss)$3,723 $9,921 $4,505 $(2,402)$(13,654)$2,093 

Historical Timeline

Fiscal YearFiled
2025Mar 17, 2026Showing above
2024Mar 17, 2025
2023Apr 1, 2024
2022Mar 31, 2023
2021Mar 21, 2022
2020Mar 24, 2021
2015Mar 14, 2016

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.

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