v3.26.3
OPERATING SEGMENTS
 3 Months Ended
Sep. 30, 2026
Segment Reporting [Abstract]  
OPERATING SEGMENTS

NOTE 18– OPERATING SEGMENTS

 

The Company has identified three segments for its products and services: North America, Europe, and Asia-Pacific. The reportable segments are business units located in different global regions. Each business unit provides similar products and services: license fees for leasing and asset-based software, subscription and support fees, and implementation and IT consulting services. Separate management of each segment is required because each business unit is subject to different operational issues and strategies due to its particular regional location. The Company’s chief operating decision maker (“CODM”) evaluates performance and allocates resources based on gross profit and income from operations. The Company has designated its Chief Executive Officer as the CODM.

 

Segment assets include all assets attributable to operations within the respective geographic regions, including cash, accounts receivable, contract assets, and property, plant, and equipment. Corporate assets, which primarily consist of cash and cash equivalents, goodwill, and assets associated with the Company’s corporate headquarters, are not allocated to the geographic segments and are shown separately.

 

 

NETSOL TECHNOLOGIES, INC.

Notes to Condensed Consolidated Financial Statements

September 30, 2026

(Unaudited)

 

The following tables present financial information by reportable segment for the three months ended September 30, 2026:

 

   North America   Europe   Asia - Pacific   Total 
   For the Three Months Ended 
   September 30, 2026 
   North America   Europe   Asia - Pacific   Total 
Revenues                    
License  $-   $1,277   $547,986   $549,263 
Subscription and support   1,552,969    1,181,114    6,771,125    9,505,208 
Services   1,093,741    1,363,079    3,901,169    6,357,989 
Intersegment revenues   -     -    1,970,747    1,970,747 
Total revenue from reportable segments   2,646,710    2,545,470    13,191,027    18,383,207 
Elimination of intersegment revenues   -     -     -     (1,970,747)
Total consolidated revenues                 $16,412,460 
                     
Revenues from reportable segments   2,646,710    2,545,470    13,191,027    18,383,207 
                     
Salaries and consultants   385,429    1,169,127    4,697,061    6,251,617 
Travel   85,973    27,216    236,861    350,050 
Depreciation   -    -    216,356    216,356 
Other (a)   1,143,339    1,243,667    897,083    3,284,089 
Gross Profit   1,031,969    105,460    7,143,666    8,281,095 
                     
Selling and marketing   529,177    318,942    1,859,839    2,707,958 
Depreciation   2,142    42,850    70,936    115,928 
General and administrative   211,022    906,376    2,513,802    3,631,200 
Income (loss) from operations - reportable segments  $289,628   $(1,162,708)  $2,699,089   $1,826,009 
                     
Reconciliation:                    
Income (loss) from operations - reportable segments                 $1,826,009 
Corporate operating expenses                  (1,417,249)
Interest expense                  (111,360)
Interest income                  301,068 
Gain (loss) on foreign currency exchange transactions                  (6,811)
Other income (expense)                  47,677 
Net income (loss) before income taxes                 $639,334 

 

Segment assets:  North America   Europe   Asia - Pacific   Total 
   As of 
   September 30, 2026 
Segment assets:  North America   Europe   Asia - Pacific   Total 
Cash  $463,515   $152,016   $18,771,644   $19,387,175 
Accounts receivable, net of allowance   1,525,417    1,052,176    6,566,601    9,144,194 
Contract assets, net of allowance   978,341    5,179,699    15,302,614    21,460,654 
Other segment assets (b)   123,001    1,060,641    12,709,092    13,892,734 
Total segment assets  $3,090,274   $7,444,532   $53,349,951   $63,884,757 
                     
Asset Reconciliation                    
Total assets for reportable segments                  63,884,757 
Corporate assets                  551,725 
Goodwill not allocated to segments                  9,302,524 
Consolidated total                 $73,739,006 

 

   North America   Europe   Asia - Pacific   Total 
  

For the three months ended

September 30, 2026

 
   North America   Europe   Asia - Pacific   Total 
                     
Expenditures for property, plant and equipment  $3,964   $65,763   $906,282   $976,009 

 

 

NETSOL TECHNOLOGIES, INC.

Notes to Condensed Consolidated Financial Statements

September 30, 2026

(Unaudited)

 

The following tables present financial information by reportable segment for the three months ended September 30, 2025:

 

   North America   Europe   Asia - Pacific   Total 
   For the Three Months Ended 
   September 30, 2025 
   North America   Europe   Asia - Pacific   Total 
Revenues                    
License  $-   $72,225   $-   $72,225 
Subscription and support   1,486,397    1,484,646    5,989,512    8,960,555 
Services   621,966    1,747,446    3,609,731    5,979,143 
Intersegment revenues   -     -     1,061,771    1,061,771 
Total revenue from reportable segments   2,108,363    3,304,317    10,661,014    16,073,694 
Elimination of intersegment revenues   -     -     -     (1,061,771)
Total consolidated revenues                 $15,011,923 
                     
Revenues from reportable segments   2,108,363    3,304,317    10,661,014    16,073,694 
                     
Salaries and consultants   492,636    1,133,001    5,338,889    6,964,526 
Travel   53,734    67,360    377,078    498,172 
Depreciation   -    -    208,731    208,731 
Other (a)   501,302    918,027    1,070,946    2,490,275 
Gross Profit   1,060,691    1,185,929    3,665,370    5,911,990 
                     
Selling and marketing   637,561    395,008    1,907,598    2,940,167 
Depreciation   1,594    44,608    69,673    115,875 
General and administrative   299,026    889,577    2,272,570    3,461,173 
Income (loss) from operations - reportable segments  $122,510   $(143,264)  $(584,471)  $(605,225)
                     
Reconciliation:                    
Income (loss) from operations - reportable segments                 $(605,225)
Corporate operating expenses                  (1,233,481)
Interest expense                  (174,611)
Interest income                  280,974 
Gain (loss) on foreign currency exchange transactions                  (286,917)
Other income (expense)                  17,670 
Net income (loss) before income taxes                 $(2,001,590)

 

Segment assets:  North America   Europe   Asia - Pacific   Total 
   As of 
   June 30, 2026 
Segment assets:  North America   Europe   Asia - Pacific   Total 
Cash  $399,011   $1,539,968   $24,997,445   $26,936,424 
Accounts receivable, net of allowance   930,051    1,205,268    8,151,023    10,286,342 
Contract assets, net of allowance   608,239    4,316,555    13,782,788    18,707,582 
Other segment assets (b)   162,451    1,146,259    10,767,095    12,075,805 
Total segment assets  $2,099,752   $8,208,050   $57,698,351   $68,006,153 
                     
Asset Reconciliation                    
Total assets for reportable segments                  68,006,153 
Corporate assets                  530,372 
Goodwill not allocated to segments                  9,302,524 
Consolidated total                 $77,839,049 

 

   North America   Europe   Asia - Pacific   Total 
  

For the three months ended

September 30, 2025

 
   North America   Europe   Asia - Pacific   Total 
                     
Expenditures for property, plant and equipment  $21,099   $38,187   $425,995   $485,281 

 

(a)Other costs of goods sold include computer costs, third-party hardware and software costs, repair and maintenance, insurance, utilities, and communication expenses.

 

(b)Other assets include property and equipment, right of use of assets, internally developed software cost, advances, deposits, and prepayments.

 

 

NETSOL TECHNOLOGIES, INC.

Notes to Condensed Consolidated Financial Statements

September 30, 2026

(Unaudited)