Concentration of Risk and Segment Data
 6 Months Ended
Feb. 28, 2022
Segment Reporting [Abstract]  
Concentration of Risk and Segment Data Concentration of Risk and Segment Data
Concentration of Risk
Sales of the Company’s products are concentrated among specific customers. During the six months ended February 28, 2022, the Company’s five largest customers accounted for approximately 47% of its net revenue and 78 customers accounted for approximately 90% of its net revenue. Sales to these customers were reported in the Electronics Manufacturing Services (“EMS”) and Diversified Manufacturing Services (“DMS”) operating segments.
The Company procures components from a broad group of suppliers. Some of the products manufactured by the Company require one or more components that are available from only a single source.
Segment Data
Net revenue for the operating segments is attributed to the segment in which the service is performed. An operating segment’s performance is evaluated based on its pre-tax operating contribution, or segment income. Segment income is defined as net revenue less cost of revenue, segment selling, general and administrative expenses, segment research and development expenses and an allocation of corporate manufacturing expenses and selling, general and administrative expenses. Certain items are excluded from the calculation of segment income. Transactions between operating segments are generally recorded at amounts that approximate those at which we would transact with third parties.
The following table sets forth operating segment information (in millions):
  Three months ended Six months ended
  February 28, 2022 February 28, 2021 February 28, 2022 February 28, 2021
Segment income and reconciliation of income before income tax
EMS $ 152  $ 98  $ 299  $ 220 
DMS 192  187  445  430 
Total segment income $ 344  $ 285  $ 744  $ 650 
Reconciling items:
Amortization of intangibles (8) (12) (16) (23)
Stock-based compensation expense and related charges (16) (23) (51) (57)
Restructuring, severance and related charges —  (6) —  (5)
Business interruption and impairment charges, net —  1  —  1 
Acquisition and integration charges —  (2) —  (4)
Other expense (net of periodic benefit cost) (3) (5) (11) (9)
Interest income —  2  1  4 
Interest expense (33) (31) (66) (63)
Income before income tax $ 284  $ 209  $ 601  $ 494 
 
The following table presents the Company’s revenues disaggregated by segment (in millions):
Three months ended
February 28, 2022 February 28, 2021
EMS DMS Total EMS DMS Total
Timing of transfer
Point in time $ 1,327  $ 1,418  $ 2,745  $ 819  $ 1,782  $ 2,601 
Over time 2,447  2,361  4,808  2,360  1,867  4,227 
Total $ 3,774  $ 3,779  $ 7,553  $ 3,179  $ 3,649  $ 6,828 
Six months ended
February 28, 2022 February 28, 2021
EMS DMS Total EMS DMS Total
Timing of transfer
Point in time $ 2,734  $ 3,788  $ 6,522  $ 1,876  $ 4,022  $ 5,898 
Over time 4,898  4,700  9,598  4,896  3,867  8,763 
Total $ 7,632  $ 8,488  $ 16,120  $ 6,772  $ 7,889  $ 14,661 


The Company operates in more than 30 countries worldwide. Sales to unaffiliated customers are based on the Company location that maintains the customer relationship and transacts the external sale. The following table sets forth, for the periods indicated, foreign source revenue expressed as a percentage of net revenue:
Three months ended Six months ended
  February 28, 2022 February 28, 2021 February 28, 2022 February 28, 2021
Foreign source revenue 83.5  % 84.7  % 84.2  % 84.1  %