LeapFrog 2015 Annual Report Download - page 87

LEAPFROG ENTERPRISES, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except per share data)
20. Commitments and Contingencies − (continued)
financial position, results of operations or cash flows. Regardless of the outcome, litigation can have an
adverse impact on the Company because of defense costs, diversion of management resources and other
factors. In addition, although management considers the likelihood of such an outcome to be remote, if one or
more of these legal matters were resolved against the Company in a particular reporting period for amounts in
excess of management’s expectations, the Company’s consolidated financial statements of the same reporting
period could be materially adversely affected.
21. Segment Reporting
The Company’s business is organized, operated and assessed in two geographic segments: U.S. and
International.
The Company attributes sales to non-U.S. countries on the basis of sales billed by each of its foreign
subsidiaries to its customers. Additionally, the Company attributes sales to non-U.S. countries if the product is
shipped from Asia or one of its leased warehouses in the U.S. to a distributor in a foreign country. The
Company charges all of its indirect operating expenses and general corporate overhead to the U.S. segment
and does not allocate any of these expenses to the International segment.
The accounting policies of the segments are the same as those described in Note 2 of these Notes to the
Consolidated Financial Statements.
The primary business of the two operating segments is as follows:
• The U.S. segment is responsible for the development, design, sale and marketing of multimedia
learning platforms, related content and learning toys, which are sold primarily through retailers,
distributors, and directly to consumers via the App Center in the U.S. The App Center includes both
content developed by the Company and content from third parties that the Company curates and
distributes.
• The International segment is responsible for the localization, sale and marketing of multimedia
learning platforms, related content, and learning toys, originally developed for the U.S. This segment
markets and sells the Company’s products to national and regional mass-market and specialty
retailers and other outlets through the Company’s offices outside of the U.S., through distributors in
various international markets, and directly to consumers via the App Center.
The table below shows certain information by segment for the year ended March 31, 2015, the three months
ended March 31, 2014 and the years ended December 31, 2013 and 2012:
Year Ended
March 31,
2015
Three Months
Ended March 31, Years Ended December 31,
2014 2013 2012
Net sales:
United States ..................... $232,736 $ 39,145 $ 386,983 $ 424,816
International ...................... 106,413 17,741 166,632 156,472
Totals ......................... $339,149 $ 56,886 $ 553,615 $ 581,288
Income (loss) from operations:
United States ..................... $(147,457) $ (19,782) $ (1,257) $ 28,076
International ...................... 6,821 1,140 36,179 35,990
Totals ......................... $(140,636) $ (18,642) $ 34,922 $ 64,066
Total assets:
United States ..................... $217,924 $ 423,874 $ 420,329 $ 328,975
International ...................... 42,268 51,944 90,743 99,930
Totals ......................... $260,192 $ 475,818 $ 511,072 $ 428,905
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