Business Segments and Geographic Information

6 Months Ended

Jun. 30, 2025

Business Segments and Geographic Information

12.	Business Segments and Geographic Information

Our reporting segments are: 1) Data and Analytics Services; and 2) IT Staffing Services.

The Data and Analytics Services segment was acquired through the July 13, 2017, acquisition of the services division of Canada-based InfoTrellis, Inc. This segment is a project-based consulting services business with specialized capabilities in data management and analytics. The business is marketed as “Mastech InfoTrellis” and utilizes a dedicated sales team with deep subject matter expertise. Mastech InfoTrellis has offices in Toronto and London, and a global delivery center in Chennai, India. Project-based delivery reflects a combination of

on-site

resources and offshore resources. Assignments are secured on both a time and material and fixed price basis. In October 2020, we acquired AmberLeaf, a Chicago-based customer experience consulting firm. This acquisition expanded our capabilities in customer experience strategy and managed services offering for a variety of Cloud-based enterprise application across sales, marketing and customer service organizations.

The IT Staffing Services segment offers staffing services in digital and mainstream technologies, engineering services and uses digital methods to enhance organizational learning. These services are marketed using a common sales force and delivered via our domestic and global recruitment centers. While the vast majority of our assignments are based on time and materials, we do have the capabilities to deliver our digital transformation services on a fixed price basis. Below are the operating results of our reporting segments.


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
	(Amounts in thousands)
Revenues:
Data and Analytics Services	$	8,589		$	8,876		$	17,549		$	16,943
IT Staffing Services		40,508			40,658			79,865			79,414

Total revenues	$	49,097		$	49,534		$	97,414		$	96,357

Cost of Revenues:
Data and Analytics Services	$	4,706		$	4,507		$	9,719		$	8,829
IT Staffing Services		30,571			31,047			60,983			61,417

Total cost of revenues	$	35,277		$	35,554		$	70,702		$	70,246

Gross Profit:
Data and Analytics Services	$	3,883		$	4,369		$	7,830		$	8,114
IT Staffing Services		9,937			9,611			18,882			17,997

Total gross profit	$	13,820		$	13,980		$	26,712		$	26,111

Gross Margin %:
Data and Analytics Services		45.2	%		49.2	%		44.6	%		47.9	%
IT Staffing Services		24.5	%		23.6	%		23.6	%		22.7	%

Total gross margin %		28.1	%		28.2	%		27.4	%		27.1	%

Sales & Marketing Expenses:
Data and Analytics Services	$	1,785		$	1,862		$	3,839		$	4,279
IT Staffing Services		2,439			2,233			4,686			4,397

Total sales & marketing expenses	$	4,224		$	4,095		$	8,525		$	8,676


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
	(Amounts in thousands)
Operations Expenses:
Data and Analytics Services	$	194		$	176		$	346		$	343
IT Staffing Services		1,831			2,143			3,898			4,070

Total operations expenses	$	2,025		$	2,319		$	4,244		$	4,413

General & Administrative Expenses:
Data and Analytics Services	$	2,058		$	1,587		$	3,927		$	3,202
IT Staffing Services		3,917			3,593			8,214			7,147

Total general & administrative expenses	$	5,975		$	5,180		$	12,141		$	10,349

Segment operating income (loss):
Data and Analytics Services	$	(154	)	$	744		$	(282	)	$	290
IT Staffing Services		1,750			1,642			2,084			2,383

Subtotal		1,596			2,386			1,802			2,673
Unallocated Cost:
Amortization of acquired intangible assets	$	(649	)	$	(693	)	$	(1,299	)	$	(1,386	)
Finance and accounting transition expense		(688	)		—			(688	)		—
Severance expense		(232	)		—			(1,641	)		—
Interest income (expense), FX, gains (losses) and other, net		183			116			274			240

Income (loss) before income taxes	$	210		$	1,809		$	(1,552	)	$	1,527

Below is a reconciliation of segment total assets to consolidated total assets:


	June 30, 2025		December 31, 2024
	(Amounts in thousands)
Total assets:
Data and Analytics Services	$	41,295	$	44,053
IT Staffing Services		69,097		67,431

Total assets	$	110,392	$	111,484

Below is geographic information related to our revenues from external customers:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(Amounts in thousands)
United States	$	48,582	$	48,515	$	96,334	$	94,631
Canada		146		308		276		602
India and Other		369		711		804		1,124

Total revenues	$	49,097	$	49,534	$	97,414	$	96,357

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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+ Details

Mastech Digital, Inc. 10-Q