Note 11 - Significant Customers and Industry Segment Information |
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Segment Reporting Disclosure [Text Block] |
Note 11. Significant Customers and Industry Segment InformationThe Company has two reportable segments: Microsource and the Giga-tronics Division. Microsource's primary business is the design of custom Microwave Integrated Components (“MIC”) as well as the production of MIC components using chip and wire assembly methods. Microsource offers a line of tunable, synthesized Band Reject Filters for solving interference problems in RADAR/EW applications. Self-protection systems onboard high-performance military aircrafts often require RADAR filters to block electromagnetic interference generated by other onboard electronic systems, particularly the aircraft's main RADAR system. These high-speed, tunable notch filters can quickly block interference from both continuous wave and wide bandwidth emissions. Using proprietary driver and phase lock technology, these filters offer tuning speeds that are up to ten times faster than traditional filter designs. We design these filters specifically for each application. Microsource's two largest customers are prime contractors for which it develops and manufactures RADAR filters used in fighter jet aircrafts.The Giga-tronics Division designs, manufactures and markets a family of functional test products for the RADAR/EW segment of the defense electronics market. Our RADAR/EW test products are used to evaluate and improve the performance of RADAR/EW systems. The accounting policies for the segments are the same as those described in the “Summary of Significant Accounting Policies”. The Company evaluates the performance of its segments and allocates resources to them based on earnings before income taxes. Segment net revenue include revenue to external customers. Inter-segment activities are eliminated in consolidation. Assets include accounts receivable, inventories, equipment, cash, deferred income taxes, prepaid expenses and other long- term assets. The Company accounts for inter-segment revenue and transfers at terms that allow a reasonable profit to the seller. During the periods reported there were no significant inter-segment revenue or transfers.The Company's reportable operating segments are strategic business units that offer different products and services. They are managed separately because each business utilizes different technology and requires different accounting systems. The Company's chief operating decision maker is considered to be the Company's Chief Executive Officer (“CEO”). The CEO reviews financial information presented on a consolidated basis accompanied by disaggregated information about revenues and pre-tax income or loss by operating segment. The tables below present information for fiscal years ended March 27, 2021 and March 28, 2020.
The Company's Giga-tronics Division and Microsource segment sell to agencies of the U.S. government and U.S. defense- related customers. In fiscal 2021 and 2020, U.S. government and U.S. defense-related customers accounted for 99% and 85% of revenue, respectively. During fiscal 2021, two prime contractors accounted for 66% of the Company's consolidated revenues and were included in the Microsource segment. A third customer accounted for 14% of the Company's consolidated revenues during fiscal 2021 and was included in the Giga-tronics Division.During fiscal 2020, two prime contractors accounted for 64% of the Company's consolidated revenues and were included in the Microsource segment. A third customer accounted for 18% of the Company's consolidated revenues during fiscal 2020 and was included in the Giga-tronics Division.Export revenue accounted for less than
1% 2021 and 2020.
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