Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2023 | Oct. 30, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 0-28082 | |
Entity Registrant Name | KVH Industries, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 05-0420589 | |
Entity Address, Address Line One | 50 Enterprise Center | |
Entity Address, City or Town | Middletown | |
Entity Address, State or Province | RI | |
Entity Address, Postal Zip Code | 02842 | |
City Area Code | 401 | |
Local Phone Number | 847-3327 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | KVHI | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 19,610,790 | |
Entity Central Index Key | 0001007587 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 11,484 | $ 21,056 |
Marketable securities | 57,710 | 55,680 |
Accounts receivable, net of allowance for credit losses of $1,010 and $1,268 as of September 30, 2023 and December 31, 2022, respectively | 28,190 | 27,427 |
Inventories | 26,423 | 22,730 |
Prepaid expenses and other current assets | 4,617 | 3,067 |
Current contract assets | 1,130 | 1,243 |
Total current assets | 129,554 | 131,203 |
Property and equipment, net | 49,407 | 53,118 |
Intangible assets, net | 0 | 404 |
Goodwill | 0 | 5,308 |
Right of use assets | 1,191 | 2,168 |
Other non-current assets | 3,985 | 5,037 |
Non-current contract assets | 2,557 | 3,033 |
Deferred income tax asset | 258 | 259 |
Total assets | 186,952 | 200,530 |
Current liabilities: | ||
Accounts payable | 3,644 | 20,449 |
Accrued compensation and employee-related expenses | 4,936 | 7,621 |
Accrued other | 11,609 | 4,234 |
Accrued product warranty costs | 642 | 1,287 |
Contract liabilities | 3,268 | 3,108 |
Current operating lease liability | 921 | 1,532 |
Liability for uncertain tax positions | 693 | 637 |
Total current liabilities | 25,713 | 38,868 |
Long-term operating lease liability | 272 | 636 |
Long-term contract liabilities | 3,905 | 4,315 |
Deferred income tax liability | 55 | 55 |
Total liabilities | 29,945 | 43,874 |
Commitments and contingencies (Notes 2, 10, and 15) | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value. Authorized 1,000,000 shares; none issued | 0 | 0 |
Common stock, $0.01 par value. Authorized 30,000,000 shares; 21,066,899 and 20,631,152 shares issued at September 30, 2023 and December 31, 2022, respectively; and 19,610,790 and 19,198,458 shares outstanding at September 30, 2023 and December 31, 2022, respectively | 211 | 206 |
Additional paid-in capital | 164,505 | 160,475 |
Retained earnings | 8,603 | 11,936 |
Accumulated other comprehensive loss | (4,222) | (4,110) |
Stockholders equity before treasury stock adjustment | 169,097 | 168,507 |
Less: treasury stock at cost, common stock, 1,456,109 and 1,432,694 shares as of September 30, 2023 and December 31, 2022, respectively. | (12,090) | (11,851) |
Total stockholders’ equity | 157,007 | 156,656 |
Total liabilities and stockholders’ equity | $ 186,952 | $ 200,530 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 1,010 | $ 1,268 |
Preferred stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 30,000,000 | 30,000,000 |
Common stock, shares issued (in shares) | 21,066,899 | 20,631,152 |
Common stock, shares outstanding (in shares) | 19,610,790 | 19,198,458 |
Treasury stock at cost, outstanding (in shares) | 1,456,109 | 1,432,694 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Sales: | ||||
Net sales | $ 33,549 | $ 35,169 | $ 101,409 | $ 102,873 |
Costs and expenses: | ||||
Research and development | 2,398 | 2,745 | 7,379 | 8,380 |
Sales, marketing and support | 4,854 | 5,710 | 15,708 | 18,355 |
General and administrative | 4,367 | 5,559 | 13,139 | 19,532 |
Goodwill impairment charge | 5,333 | 0 | 5,333 | 0 |
Long-lived assets impairment charge | 657 | 0 | 657 | 0 |
Total costs and expenses | 38,576 | 36,140 | 106,660 | 109,135 |
Loss from operations | (5,027) | (971) | (5,251) | (6,262) |
Interest income | 997 | 389 | 2,660 | 798 |
Interest expense | 0 | 1 | 0 | 3 |
Other (expense) income, net | (121) | 569 | (583) | 1,561 |
Loss from continuing operations before income tax expense | (4,151) | (14) | (3,174) | (3,906) |
Income tax expense from continuing operations | 95 | 81 | 159 | 645 |
Net loss from continuing operations | (4,246) | (95) | (3,333) | (4,551) |
Net income from discontinued operations, net of tax | 0 | 29,741 | 0 | 28,061 |
Net (loss) income | $ (4,246) | $ 29,646 | $ (3,333) | $ 23,510 |
Net loss from continuing operations per common share | ||||
Basic (in shares) | $ (0.22) | $ (0.01) | $ (0.17) | $ (0.25) |
Diluted (in shares) | (0.22) | (0.01) | (0.17) | (0.25) |
Net income from discontinued operations per common share | ||||
Basic (in shares) | 0 | 1.59 | 0 | 1.51 |
Diluted (in shares) | 0 | 1.59 | 0 | 1.51 |
Net (loss) income per common share | ||||
Basic (in USD per share) | (0.22) | 1.58 | (0.17) | 1.27 |
Diluted (in USD per share) | $ (0.22) | $ 1.58 | $ (0.17) | $ 1.27 |
Weighted average number of common shares outstanding: | ||||
Basic (in shares) | 19,231 | 18,706 | 19,090 | 18,574 |
Diluted (in shares) | 19,231 | 18,706 | 19,090 | 18,574 |
Product | ||||
Sales: | ||||
Net sales | $ 4,152 | $ 6,625 | $ 14,526 | $ 19,808 |
Costs and expenses: | ||||
Costs of sales | 4,729 | 6,747 | 16,596 | 17,363 |
Service | ||||
Sales: | ||||
Net sales | 29,397 | 28,544 | 86,883 | 83,065 |
Costs and expenses: | ||||
Costs of sales | $ 16,238 | $ 15,379 | $ 47,848 | $ 45,505 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive (Loss) Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | ||
Statement of Comprehensive Income [Abstract] | |||||
Net (loss) income | $ (4,246) | $ 29,646 | $ (3,333) | $ 23,510 | |
Other comprehensive loss, net of tax: | |||||
Unrealized gain on available-for-sale securities | 0 | 0 | 12 | 0 | |
Foreign currency translation adjustment | (267) | (646) | (124) | (1,258) | |
Other comprehensive loss, net of tax | [1] | (267) | (646) | (112) | (1,258) |
Total comprehensive (loss) income | $ (4,513) | $ 29,000 | $ (3,445) | $ 22,252 | |
[1]Tax impact was nominal for all periods. |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | |
Beginning balance (in shares) at Dec. 31, 2021 | 20,343,000 | ||||||
Beginning balance at Dec. 31, 2021 | $ 128,977 | $ 203 | $ 156,199 | $ (12,165) | $ (3,409) | $ (11,851) | |
Beginning balance, treasury stock (in shares) at Dec. 31, 2021 | (1,433,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | 23,510 | 23,510 | |||||
Other comprehensive loss | (1,258) | [1] | (1,258) | ||||
Stock-based compensation | 2,695 | 2,695 | |||||
Issuance of common stock under employee stock purchase plan (in shares) | 22,000 | ||||||
Issuance of common stock under employee stock purchase plan | 193 | 193 | |||||
Exercise of stock options and issuance of restricted stock awards, net of forfeitures (in shares) | 241,000 | ||||||
Exercise of stock options and issuance of restricted stock awards, net of forfeitures | 602 | $ 3 | 599 | ||||
Taxes accrued for net share settlement of options | (131) | (131) | |||||
Ending balance (in shares) at Sep. 30, 2022 | 20,606,000 | ||||||
Ending balance at Sep. 30, 2022 | 154,588 | $ 206 | 159,555 | 11,345 | (4,667) | $ (11,851) | |
Ending balance, treasury stock (in shares) at Sep. 30, 2022 | (1,433,000) | ||||||
Beginning balance (in shares) at Dec. 31, 2021 | 20,343,000 | ||||||
Beginning balance at Dec. 31, 2021 | $ 128,977 | $ 203 | 156,199 | (12,165) | (3,409) | $ (11,851) | |
Beginning balance, treasury stock (in shares) at Dec. 31, 2021 | (1,433,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Acquisition of treasury stock (in shares) | 0 | ||||||
Ending balance (in shares) at Dec. 31, 2022 | 19,198,458 | 20,631,000 | |||||
Ending balance at Dec. 31, 2022 | $ 156,656 | $ 206 | 160,475 | 11,936 | (4,110) | $ (11,851) | |
Ending balance, treasury stock (in shares) at Dec. 31, 2022 | (1,432,694) | (1,433,000) | |||||
Beginning balance (in shares) at Jun. 30, 2022 | 20,503,000 | ||||||
Beginning balance at Jun. 30, 2022 | $ 124,028 | $ 205 | 157,996 | (18,301) | (4,021) | $ (11,851) | |
Beginning balance, treasury stock (in shares) at Jun. 30, 2022 | (1,433,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | 29,646 | 29,646 | |||||
Other comprehensive loss | (646) | [1] | (646) | ||||
Stock-based compensation | 1,109 | 1,109 | |||||
Exercise of stock options and issuance of restricted stock awards, net of forfeitures (in shares) | 103,000 | ||||||
Exercise of stock options and issuance of restricted stock awards, net of forfeitures | 451 | $ 1 | 450 | ||||
Ending balance (in shares) at Sep. 30, 2022 | 20,606,000 | ||||||
Ending balance at Sep. 30, 2022 | $ 154,588 | $ 206 | 159,555 | 11,345 | (4,667) | $ (11,851) | |
Ending balance, treasury stock (in shares) at Sep. 30, 2022 | (1,433,000) | ||||||
Beginning balance (in shares) at Dec. 31, 2022 | 19,198,458 | 20,631,000 | |||||
Beginning balance at Dec. 31, 2022 | $ 156,656 | $ 206 | 160,475 | 11,936 | (4,110) | $ (11,851) | |
Beginning balance, treasury stock (in shares) at Dec. 31, 2022 | (1,432,694) | (1,433,000) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | $ (3,333) | (3,333) | |||||
Other comprehensive loss | (112) | [1] | (112) | ||||
Stock-based compensation | 1,433 | 1,433 | |||||
Issuance of common stock under employee stock purchase plan (in shares) | 17,000 | ||||||
Issuance of common stock under employee stock purchase plan | 123 | 123 | |||||
Acquisition of treasury stock (in shares) | (23,000) | ||||||
Acquisition of treasury stock | (239) | $ (239) | |||||
Exercise of stock options and issuance of restricted stock awards, net of forfeitures (in shares) | 419,000 | ||||||
Exercise of stock options and issuance of restricted stock awards, net of forfeitures | $ 2,479 | $ 5 | 2,474 | ||||
Ending balance (in shares) at Sep. 30, 2023 | 19,610,790 | 21,067,000 | |||||
Ending balance at Sep. 30, 2023 | $ 157,007 | $ 211 | 164,505 | 8,603 | (4,222) | $ (12,090) | |
Ending balance, treasury stock (in shares) at Sep. 30, 2023 | (1,456,109) | (1,456,000) | |||||
Beginning balance (in shares) at Jun. 30, 2023 | 20,969,000 | ||||||
Beginning balance at Jun. 30, 2023 | $ 160,704 | $ 210 | 163,690 | 12,849 | (3,955) | $ (12,090) | |
Beginning balance, treasury stock (in shares) at Jun. 30, 2023 | (1,456,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | (4,246) | (4,246) | |||||
Other comprehensive loss | (267) | [1] | (267) | ||||
Stock-based compensation | 559 | 559 | |||||
Issuance of common stock under employee stock purchase plan (in shares) | 17,000 | ||||||
Issuance of common stock under employee stock purchase plan | 123 | 123 | |||||
Exercise of stock options and issuance of restricted stock awards, net of forfeitures (in shares) | 81,000 | ||||||
Exercise of stock options and issuance of restricted stock awards, net of forfeitures | $ 134 | $ 1 | 133 | ||||
Ending balance (in shares) at Sep. 30, 2023 | 19,610,790 | 21,067,000 | |||||
Ending balance at Sep. 30, 2023 | $ 157,007 | $ 211 | $ 164,505 | $ 8,603 | $ (4,222) | $ (12,090) | |
Ending balance, treasury stock (in shares) at Sep. 30, 2023 | (1,456,109) | (1,456,000) | |||||
[1]Tax impact was nominal for all periods. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities: | ||
Net (loss) income | $ (3,333) | $ 23,510 |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Provision for credit losses | (168) | 459 |
Depreciation and amortization | 10,119 | 10,756 |
Long-lived assets impairment charge | 5,990 | 0 |
Deferred income taxes | 1 | (31) |
Loss on disposals of fixed assets | 511 | 362 |
Compensation expense related to stock-based awards and employee stock purchase plan | 1,433 | 2,695 |
Unrealized currency translation gain | (150) | (808) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (593) | (117) |
Inventories | (3,693) | (9,643) |
Prepaid expenses, other current assets, and current contract assets | (1,430) | (1,543) |
Other non-current assets and non-current contract assets | 1,530 | 1,574 |
Accounts payable | (16,758) | 612 |
Contract liabilities and long-term contract liabilities | (255) | 203 |
Accrued compensation, product warranty and other | 4,119 | 1,993 |
Net cash used in operating activities | (2,677) | (1,467) |
Cash flows from investing activities: | ||
Capital expenditures | (7,170) | (11,000) |
Cash paid for acquisition of intangible asset | (35) | (42) |
Purchases of marketable securities | (17,441) | (55,203) |
Maturities and sales of marketable securities | 15,422 | 13,164 |
Net cash (used in) provided by investing activities | (9,224) | 4,297 |
Cash flows from financing activities: | ||
Proceeds from stock options exercised and employee stock purchase plan | 2,604 | 796 |
Purchase of treasury stock | (239) | 0 |
Payment of finance lease | (22) | (198) |
Net cash provided by financing activities | 2,343 | 598 |
Effect of exchange rate changes on cash and cash equivalents | (14) | (402) |
Net (decrease) increase in cash and cash equivalents | (9,572) | 3,026 |
Cash and cash equivalents at beginning of period | 21,056 | 11,376 |
Cash and cash equivalents at end of period | 11,484 | 14,402 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Changes in accrued other and accounts payable related to property and equipment additions | 3 | 6 |
Taxes accrued for net share settlement of options | 0 | 131 |
KVH Media Group | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Gain on sale of KVH Media Group Entertainment Limited | 0 | (631) |
Cash flows from investing activities: | ||
Proceeds from the sale of KVH Media Group Entertainment Limited, net of cash sold | 0 | 2,378 |
Intertial Navigation | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Gain on sale of KVH Media Group Entertainment Limited | 0 | (30,858) |
Cash flows from investing activities: | ||
Proceeds from the sale of KVH Media Group Entertainment Limited, net of cash sold | $ 0 | $ 55,000 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business KVH Industries, Inc. (together with its subsidiaries, the Company or KVH) designs, develops, manufactures and markets mobile connectivity products and services for the marine and land markets. KVH’s satellite-only and hybrid products enable marine customers to receive data, Voice over Internet Protocol (VoIP), and value-added services via satellite, cellular, and shore-based Wi-Fi networks onboard commercial, leisure, and military/government vessels. In addition, the Company’s in-motion television terminals permit customers to receive live digital television via regional satellite services in marine vessels, recreational vehicles, buses and automobiles. KVH sells its products through an extensive international network of dealers and distributors. KVH also sells and leases products to service providers and end users. KVH’s service sales primarily represent revenue earned from satellite Internet airtime services. KVH provides, for monthly fixed and per-usage fees, satellite connectivity encompassing broadband Internet and VoIP services, to its TracNet H-series and TracPhone V-HTS series customers via KVH’s global high-throughput satellite (HTS) network. Revenue from our cellular airtime service increasingly supplements KVH’s satellite-only airtime revenue following the July 2022 launch of the KVH ONE hybrid network and TracNet H-series terminals. This product and service combination integrates global satellite service with KVH-provided cellular service in more than 150 countries, along with shore-based Wi-Fi access. The May 2023 introduction of the KVH ONE OpenNet Program expanded access to KVH's global HTS network and airtime services to non-KVH terminals for the first time. AgilePlans, KVH’s connectivity as a service offering, is a monthly subscription model that provides global connectivity to commercial maritime customers. The subscription includes the choice of satellite-only and hybrid terminals, airtime data service, VoIP, daily news, subsidized shipping and installation, and global support for a monthly fee with no minimum contract commitment. KVH offers AgilePlans subscribers a variety of airtime data plans with varying data speeds and fixed data usage levels with per megabyte overage charges. These airtime plans are similar to those the Company offers to customers who elect to purchase or lease a TracNet H-series or TracPhone V-HTS series terminal. The Company recognizes the monthly AgilePlans subscription fee as service revenue over the service delivery period. The Company retains ownership of the hardware it provides to AgilePlans customers, who must return the hardware to KVH if they decide to terminate the service. Because KVH does not sell the hardware under AgilePlans, the Company does not recognize any product revenue when the hardware is deployed to an AgilePlans customer. KVH records the cost of the hardware used by AgilePlans customers as revenue-generating assets and depreciates the cost over an estimated useful life of five years. Since the Company is retaining ownership of the hardware, it does not accrue any warranty costs for AgilePlans hardware; however, any maintenance costs on the hardware are expensed in the period these costs are incurred. Service sales also include the distribution of commercially licensed entertainment, including news, sports, and movies to commercial customers in the maritime and hotel markets through the KVH Media Group, along with supplemental value-added cybersecurity, email, and crew internet services. In addition, KVH earns monthly usage fees from third-party satellite connectivity services, including VoIP, data and Internet services, provided to its Inmarsat and Iridium customers who choose to activate their subscriptions with KVH. Service sales also include sales from product repairs and extended warranty sales. KVH's marine leisure business is highly seasonal, and seasonality can also impact the Company's commercial marine business, although typically to a lesser degree. Historically, the Company has generated the majority of its marine leisure product revenues during the first and second quarters of each year, and these revenues typically decline in the third and fourth quarters of each year, compared to the first two quarters. Temporary suspensions of the Company's airtime services typically increase in the fourth and first quarters of each year as boats are placed out of service during the winter months. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated interim financial statements of KVH Industries, Inc. and its wholly owned subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America. The Company has evaluated all subsequent events through the date of this filing. All significant intercompany accounts and transactions have been eliminated in consolidation. The 2022 consolidated interim financial statements reflect the sale of the inertial navigation business as discontinued operations. See Notes 1 and 16 for further information on the sale of the inertial navigation business. The consolidated interim financial statements have not been audited by the Company’s independent registered public accounting firm and include all adjustments (consisting of only normal recurring adjustments) which are, in the opinion of management, necessary for a fair presentation of the financial condition, results of operations, and cash flows for the periods presented. These consolidated interim financial statements do not include all disclosures associated with annual financial statements and accordingly should be read in conjunction with the Company’s consolidated financial statements and related notes included in the Company’s annual report on Form 10-K for the year ended December 31, 2022 filed on March 16, 2023 with the Securities and Exchange Commission. The results for the three and nine months ended September 30, 2023 are not necessarily indicative of operating results for the remainder of the year. Significant Estimates and Assumptions and Other Significant Non-Recurring Transactions The preparation of interim financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the interim financial statements and the reported amounts of sales and expenses during the reporting periods. As described in the Company’s annual report on Form 10-K, the estimates and assumptions used by management affect the Company’s revenue recognition, valuation of accounts receivable, valuation of inventory, expected future cash flows including growth rates, discount rates, terminal values and other assumptions and estimates used to evaluate the recoverability of long-lived assets and goodwill, estimated fair values of long-lived assets, including goodwill, amortization methods and periods, certain accrued expenses and other related charges, stock-based compensation, contingent liabilities, forfeitures and key valuation assumptions for its share-based awards, estimated fulfillment costs for warranty obligations, tax reserves and recoverability of the Company’s net deferred tax assets and related valuation allowance, and the valuation of right-of-use assets and lease liabilities. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Foreign Currency Translation The financial statements of the Company’s foreign subsidiaries located in Denmark and Singapore are maintained using the United States dollar as the functional currency. Exchange rates in effect on the date of the transaction are used to record monetary assets and liabilities. Revenue and other expense elements are recorded at rates that approximate the rates in effect on the transaction dates. Foreign currency exchange gains and losses are recognized within “other (expense) income, net” in the accompanying consolidated statements of operations. The Company recorded a total of net foreign currency exchange gains (losses), which are comprised of both realized and unrealized foreign currency exchange gains and losses, in its accompanying consolidated statements of operations of $92 and $450 for the three months ended September 30, 2023 and 2022, respectively, and $(18) and $1,009 for the nine months ended September 30, 2023 and 2022, respectively. The financial statements of the Company’s foreign subsidiaries located in the United Kingdom, Brazil, Norway, Cyprus, India and Japan use the foreign subsidiaries’ respective local currencies as the functional currency. The Company translates the assets and liabilities of these foreign subsidiaries at the exchange rates in effect at the end of each reporting period. Net sales, costs and expenses are translated using average exchange rates in effect during the period. Gains and losses from foreign currency translation are credited or charged to accumulated other comprehensive loss included in stockholders' equity in the accompanying consolidated balance sheets. CEO Executive Employment Agreement In May 2022, the Company entered into an executive employment agreement with Brent C. Bruun in order to retain his services and provide him with certain benefits in the event that the Company terminates his employment without cause (as defined in the agreement) or Mr. Bruun terminates his employment for good reason (as defined in the agreement) (either such termination, a “Qualifying Termination”), including following a change in control. The agreement provided that, if Mr. Bruun continued to serve as an employee through December 31, 2022 (the “Retention Date”), the Company would pay him a retention bonus equal to 75% of his base salary on the agreement date, and the Company would accelerate the vesting of his equity awards that would otherwise have vested in the twelve months after the Retention Date. On October 11, 2022, the Company entered into an amendment to the employment agreement with Mr. Bruun that, among other things, increased his annual base salary to $448 per year, retroactive to July 1, 2022, increased his target annual incentive compensation for the second half of 2022 to 80% of his base salary (without changing his target annual incentive compensation for the first half of 2022), extended his Retention Date from December 31, 2022 to December 31, 2023, which effectively extended the period during which Mr. Bruun must remain employed by the Company in order to earn his retention bonus, and modified the amount of the retention bonus from 75% of his base salary in effect on May 2, 2022 to 75% of the highest base salary in effect for Mr. Bruun on or before the date he becomes entitled to receive the retention bonus or the “Partial Retention Bonus” (as defined in the employment agreement). If a Qualifying Termination occurs before December 31, 2023, Mr. Bruun will receive a pro rata portion of the retention bonus. If in connection with such a termination he becomes entitled to receive the change in control severance payments and benefits, he will also become entitled to receive the full retention bonus, and the Retention Date will be the later of the date of such change in control or such termination of employment. The amendment did not modify the terms of the employment agreement relating to acceleration of vesting of certain equity awards if Mr. Bruun remains employed by the Company through December 31, 2022. As of September 30, 2023, the Company has accrued approximately $286 for the retention bonus payable to Mr. Bruun. Contemporaneously with the amendment to Mr. Bruun’s employment agreement, the Compensation Committee also granted Mr. Bruun a restricted stock award and a non-statutory stock option, which together had an aggregate grant date fair value of approximately $100. The restricted stock award and the non-statutory stock option have terms that are materially consistent with the previously disclosed terms of similar grants to the Company’s executive officers. |
Recently Issued Accounting Stan
Recently Issued Accounting Standards and Accounting Standards Not yet Adopted | 9 Months Ended |
Sep. 30, 2023 | |
Significant Accounting Policies [Abstract] | |
Recently Issued Accounting Standards and Accounting Standards Not yet Adopted | Recently Issued Accounting Standards and Accounting Standards Not yet AdoptedThere are no recent accounting pronouncements issued by the FASB, but not yet effective, that the Company expects would have a material impact on the Company's financial statements. |
Marketable Securities
Marketable Securities | 9 Months Ended |
Sep. 30, 2023 | |
Marketable Securities [Abstract] | |
Marketable Securities | Marketable Securities Marketable securities as of September 30, 2023 and December 31, 2022 consisted of the following: September 30, 2023 Amortized Gross Gross Fair Money market mutual funds $ 57,710 $ — $ — $ 57,710 United States treasuries — — — — Total marketable securities designated as available-for-sale $ 57,710 $ — $ — $ 57,710 December 31, 2022 Amortized Gross Gross Fair Money market mutual funds $ 30,977 $ — $ — $ 30,977 United States treasuries 24,715 — (12) 24,703 Total marketable securities designated as available-for-sale $ 55,692 $ — $ (12) $ 55,680 Interest income from marketable securities was $744 and $193 during the three months ended September 30, 2023 and 2022, respectively, and $2,019 and $203 during the nine months ended September 30, 2023 and 2022, respectively. |
Stockholder's Equity
Stockholder's Equity | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement, Noncash Expense [Abstract] | |
Stockholder's Equity | Stockholder's Equity (a) Stock Equity and Incentive Plan The Company recognizes stock-based compensation in accordance with the provisions of ASC Topic 718, Compensation-Stock Compensation . On June 8, 2022, at the Company's 2022 Annual Meeting of Stockholders, the stockholders of the Company approved an amendment and restatement of the Company’s current equity compensation plan to increase the number of shares of common stock reserved for issuance under the plan by 1,280 shares, from 4,800 shares to 6,080 shares (excluding rollover shares). Stock-based compensation expense was $558 and $1,103, excluding $1 and $6 of compensation charges related to our Amended and Restated 1996 Employee Stock Purchase Plan, or the ESPP, for the three months ended September 30, 2023 and 2022, respectively, and $1,408 and $2,663, excluding $25 and $32 of compensation shares related to the ESPP, for the nine months ended September 30, 2023 and 2022, respectively. As of September 30, 2023, there was $2,272 of total unrecognized compensation expense related to stock options, which is expected to be recognized over a weighted-average period of 2.66 years. As of September 30, 2023, there was $2,953 of total unrecognized compensation expense related to restricted stock awards, which is expected to be recognized over a weighted-average period of 2.52 years. Stock Options During the three months ended September 30, 2023, the Company issued 14 shares of common stock upon the exercise of stock options and received $113 as payment for the exercise price. No shares were surrendered to the Company to satisfy minimum tax withholding obligations. Additionally, during the three months ended September 30, 2023, no stock options were granted and 133 stock options expired, were canceled or were forfeited. During the nine months ended September 30, 2023, the Company issued 274 shares of common stock upon the exercise of stock options and received $2,480 as payment for the exercise price. No shares were surrendered to the Company to satisfy minimum tax withholding obligations. Additionally, during the nine months ended September 30, 2023, 317 stock options were granted and 564 stock options expired, were canceled or were forfeited. During the nine months ended September 30, 2022, 398 stock options were granted. The Company has historically estimated the fair value of each option grant on the date of grant using the Black-Scholes option-pricing model. The weighted average assumptions utilized to determine the fair value of options granted during the nine months ended September 30, 2023 and 2022 are as follows: Nine Months Ended September 30, 2023 2022 Risk-free interest rate 4.49 % 2.97 % Expected volatility 43.93 % 43.16 % Expected life (in years) 4.30 4.24 Dividend yield 0 % 0 % As of September 30, 2023, there were 1,230 options outstanding with a weighted average exercise price of $9.57 per share and 510 options exercisable with a weighted average exercise price of $9.56 per share. Restricted Stock During the three months ended September 30, 2023, 66 shares of restricted stock were granted with a weighted average grant date fair value of 8.75 per share and no shares of restricted stock were forfeited. Additionally, during the three months ended September 30, 2023, 7 shares of restricted stock vested, of which no shares of common stock were surrendered to the Company as payment by employees in lieu of cash to satisfy minimum tax withholding obligations in connection with the vesting of restricted stock. During the nine months ended September 30, 2023, 217 shares of restricted stock were granted with a weighted average grant date fair value of $9.49 per share and 72 shares of restricted stock were forfeited. Additionally, during the nine months ended September 30, 2023, 101 shares of restricted stock vested, of which no shares of common stock were surrendered to the Company as payment by employees in lieu of cash to satisfy minimum tax withholding obligations in connection with the vesting of restricted stock. As of September 30, 2023, the Company had no unvested outstanding options and no outstanding shares of restricted stock that were subject to performance-based or market-based vesting conditions. Common Stock Repurchase In the first quarter of 2023, the Company’s Board of Directors authorized the repurchase of a portion of executive common stock. The Company repurchased 23 shares of common stock held by executives at the Company to satisfy minimum tax withholding obligations in lieu of cash payment. No shares of common stock were repurchased during the twelve months ended December 31, 2022. (b) Employee Stock Purchase Plan The Company's ESPP affords eligible employees the right to purchase common stock, via payroll deductions, through various offering periods at a purchase price equal to 85% of the fair market value of the common stock on the first or last day of the offering period, whichever is lower. During the three months ended September 30, 2023 and 2022, 17 and 0 shares were issued under the ESPP plan, respectively. During the nine months ended September 30, 2023 and 2022, 17 and 22 shares were issued under the ESPP plan, respectively. The Company recorded compensation charges related to the ESPP of $1 and $6 for the three months ended September 30, 2023 and 2022, respectively, and $25 and $32 for the nine months ended September 30, 2023 and 2022, respectively. (c) Stock-Based Compensation Expense The following table presents stock-based compensation expense, including expense for the ESPP, in the Company's consolidated statements of operations for the three and nine months ended September 30, 2023 and 2022: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Cost of product sales $ 9 $ 333 $ 25 $ 468 Cost of service sales 6 3 15 8 Research and development 162 371 399 702 Sales, marketing and support 63 14 160 225 General and administrative 319 388 834 1,292 $ 559 $ 1,109 $ 1,433 $ 2,695 (d) Accumulated Other Comprehensive Loss (AOCL) Comprehensive income (loss) includes net income (loss), unrealized gains and losses from foreign currency translation, and unrealized gains and losses on available for sale marketable securities. The components of the Company’s comprehensive income (loss) and the effect on earnings for the periods presented are detailed in the accompanying consolidated statements of comprehensive (loss) income. The balances for the three months ended September 30, 2023 and 2022 are as follows: Foreign Currency Translation Total Accumulated Other Comprehensive Loss Balance, June 30, 2023 $ (3,955) $ (3,955) Other comprehensive loss (267) (267) Net other comprehensive loss (267) (267) Balance, September 30, 2023 $ (4,222) $ (4,222) Foreign Currency Translation Total Accumulated Other Comprehensive Loss Balance, June 30, 2022 $ (4,021) $ (4,021) Other comprehensive loss (646) (646) Net other comprehensive loss (646) (646) Balance, September 30, 2022 $ (4,667) $ (4,667) The balances for the nine months ended September 30, 2023 and 2022 are as follows: Foreign Currency Translation Unrealized (Loss) Gain on Available for Sale Marketable Securities Total Accumulated Other Comprehensive Loss Balance, December 31, 2022 $ (4,098) $ (12) $ (4,110) Other comprehensive (loss) income (124) 12 (112) Net other comprehensive (loss) income (124) 12 (112) Balance, September 30, 2023 $ (4,222) $ — $ (4,222) Foreign Currency Translation Total Accumulated Other Comprehensive Loss Balance, December 31, 2021 $ (3,409) $ (3,409) Other comprehensive loss (1,258) (1,258) Net other comprehensive loss (1,258) (1,258) Balance, September 30, 2022 $ (4,667) $ (4,667) |
Net (Loss) Income from Continui
Net (Loss) Income from Continuing Operations per Common Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net (Loss) Income from Continuing Operations per Common Share | Net (Loss) Income from Continuing Operations per Common Share Basic net (loss) income per share is calculated based on the weighted average number of common shares outstanding during the period. Diluted net income per share incorporates the dilutive effect of common stock equivalent options, warrants and other convertible securities, if any, as determined with the treasury stock accounting method. For the three and nine months ended September 30, 2023, since there was a net loss from continuing operations, the Company excluded 1,572 and 1,053 shares, respectively, underlying outstanding stock options and non-vested restricted shares from its diluted loss per share calculation, as inclusion of these convertible securities would have reduced the net loss per share. For the three and nine months ended September 30, 2022, since there was a net loss from continuing operations, the Company excluded 1,572 and 1,763 shares, respectively, underlying outstanding stock options and non-vested restricted shares from its diluted loss per share calculation, as inclusion of these convertible securities would have reduced the net loss per share. A reconciliation of the basic and diluted weighted average common shares outstanding is as follows: Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Weighted average common shares outstanding—basic 19,231 18,706 19,090 18,574 Dilutive common shares issuable in connection with stock plans — — — — Weighted average common shares outstanding—diluted 19,231 18,706 19,090 18,574 |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value using the first-in first-out costing method. Inventories as of September 30, 2023 and December 31, 2022 include the costs of material, labor, and factory overhead. Components of inventories consist of the following: September 30, December 31, Raw materials $ 15,325 $ 14,203 Work in process 4,083 4,164 Finished goods 7,015 4,363 $ 26,423 $ 22,730 |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment, net, as of September 30, 2023 and December 31, 2022 consist of the following: September 30, December 31, Land $ 2,833 $ 2,833 Building and improvements 18,839 18,869 Leasehold improvements 439 513 Machinery and equipment 5,927 5,948 Revenue-generating assets 75,440 72,527 Office and computer equipment 13,613 14,652 Motor vehicles 31 31 117,122 115,373 Less accumulated depreciation (67,715) (62,255) $ 49,407 $ 53,118 Depreciation expense was $3,180 and $3,283 for the three months ended September 30, 2023 and 2022, respectively and $9,952 and $9,591 for the nine months ended September 30, 2023 and 2022, respectively. Certain revenue-generating hardware assets are utilized by the Company in the delivery of the Company's airtime services, media and other content. |
Product Warranty
Product Warranty | 9 Months Ended |
Sep. 30, 2023 | |
Product Warranties Disclosures [Abstract] | |
Product Warranty | Product Warranty The Company’s products carry standard limited warranties that range from one The following table summarizes product warranty activity during 2023 and 2022: Nine Months Ended September 30, 2023 2022 Beginning balance $ 1,287 $ 1,084 Charges to expense 521 964 Costs incurred (1,166) (764) Ending balance $ 642 $ 1,284 |
Legal Matters
Legal Matters | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Matters | Legal Matters In the ordinary course of business, the Company is a party to inquiries, legal proceedings and claims including, from time to time, disagreements with vendors and customers. The Company is not a party to any lawsuit or proceeding that, in management's opinion, is likely to materially harm the Company's business, results of operations, financial condition, or cash flows. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements ASC Topic 820, Fair Value Measurements and Disclosures (ASC 820), provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. The Company’s Level 1 assets are investments in money market mutual funds and United States treasuries. Level 2: Quoted prices for similar assets or liabilities in active markets; or observable prices that are based on observable market data, based on directly or indirectly market-corroborated inputs. The Company has no Level 2 assets or liabilities. Level 3: Unobservable inputs that are supported by little or no market activity, and are developed based on the best information available given the circumstances. The Company has no Level 3 assets. Assets and liabilities measured at fair value are based on the valuation techniques identified in the table below. The following tables present financial assets and liabilities at September 30, 2023 and December 31, 2022 for which the Company measures fair value on a recurring basis, by level, within the fair value hierarchy: September 30, 2023 Total Level 1 Level 2 Level 3 Valuation Assets Money market mutual funds $ 57,710 $ 57,710 $ — $ — (a) December 31, 2022 Total Level 1 Level 2 Level 3 Valuation Assets Money market mutual funds $ 30,977 $ 30,977 $ — $ — (a) United States treasuries $ 24,703 $ 24,703 $ — $ — (a) (a) Market approach—prices and other relevant information generated by market transactions involving identical or comparable assets. The carrying amount of certain financial instruments approximates fair value due to their short-term, highly liquid nature. These instruments include cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses. The carrying amount of the Company's operating and financing lease liabilities approximates fair value based on currently available quoted rates of similarly structured borrowings. Assets Measured and Recorded at Fair Value on a Nonrecurring Basis The Company's non-financial assets, such as goodwill, intangible assets, and other long-lived assets resulting from business combinations, are measured at fair value using income approach valuation methodologies at the date of acquisition and subsequently re-measured if indications of impairment exist. During the nine months ended September 30, 2023, the Company recorded an impairment charge of $5,990 to goodwill and long-lived assets. There were no other impairments of the Company's non-financial assets noted during the nine months ended September 30, 2023. Please see Note 12 for further discussion. The Company does not have any liabilities that are recorded at fair value on a non-recurring basis. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Other Long-Lived Assets The Company performs a goodwill impairment test at least annually, or more frequently if certain events occur, or circumstances change, that indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount. A goodwill impairment loss is recognized for the amount that the carrying amount of a reporting unit, including goodwill, exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit. The Company’s two reporting units are: Mobile Broadband (MBB) and KVH Media Group (Media). Other long-lived assets, which include intangible assets with finite lives, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability of other long-lived assets is measured by a comparison of the carrying amount of an asset group to its future undiscounted cash flows. If these comparisons indicate that an asset group is not recoverable, the Company will recognize an impairment loss for the amount by which the carrying value of the asset group exceeds its related estimated fair value. The Company has determined that the assets within each of the Company's reporting units (MBB and Media) are highly interrelated and interdependent on each other to generate revenues, and thus independent cash flows are not identifiable at a level lower than that of these reporting units. Accordingly, the Company's asset groups were determined to be its reporting units (MBB and Media). In the third quarter of 2023, the Company experienced a sustained decrease in its stock price, which was identified by the Company as an indicator of impairment. Consequently, the Company performed a quantitative assessment of impairment of goodwill and other long-lived assets for the MBB and Media reporting units and asset groups. These assessments require considerable judgment and are largely based on assumptions and estimates developed by management including estimation of future cash flows, estimation of long-term growth rates, determination of the period over which future cash flows will occur, determination of a weighted average cost of capital, and consideration of market, industry, and other factors. In performing the quantitative impairment assessment for goodwill, the Company determined the fair value of its reporting units by discounting its estimated future cash flows using an appropriate weighted average cost of capital. As of September 30, 2023, the estimated fair values of the MBB and Media reporting units were lower than their carrying values. After recognition of a long-lived asset impairment charge (as discussed below), the Company recognized a goodwill impairment charge of $5,333, which represented the total goodwill for both reporting units, in the consolidated statements of operations for the three and nine months ended September 30, 2023. In performing the quantitative impairment assessment for other long-lived assets, the Company used undiscounted cash flows expected to be generated over the estimated remaining useful life of the primary asset of each asset group, to determine whether the carrying amounts of each asset group are recoverable. As of September 30, 2023, the Company’s analysis indicated that the carrying amount of the MBB asset group is recoverable, and therefore no impairment charge was recognized. As of September 30, 2023, the Company’s analysis indicated that the carrying amount of the Media asset group is not recoverable and that such carrying amount exceeded its fair value. Accordingly, the Company recognized a long-lived assets impairment charge of $657 in the consolidated statements of operations for the three and nine months ended September 30, 2023. Goodwill The following table sets forth the changes in the carrying amount of goodwill for the nine months ended September 30, 2023: Amounts Balance at December 31, 2022 $ 5,308 Impairment (5,333) Foreign currency translation adjustment 25 Balance at September 30, 2023 $ — Intangible Assets The changes in the carrying amount of intangible assets during the nine months ended September 30, 2023 are as follows: Amounts Balance at December 31, 2022 $ 404 Amortization expense (167) Intangible assets acquired in asset acquisition 35 Impairment (274) Foreign currency translation adjustment 2 Balance at September 30, 2023 $ — Intangible assets arose from the acquisition of KVH Media Group (acquired as Headland Media Limited) in May 2013. These intangible assets were being amortized on a straight-line basis over the estimated useful life of 10 years for acquired subscriber relationships. The intangible assets were recorded in pounds sterling and fluctuations in exchange rates cause these amounts to increase or decrease from time to time. Acquired intangible assets are subject to amortization. The following table summarizes acquired intangible assets at September 30, 2023 and December 31, 2022, respectively: Gross Carrying Amount Accumulated Amortization Net Carrying Value September 30, 2023 Subscriber relationships $ — $ — $ — Distribution rights — — — Internally developed software — — — Proprietary content — — — Intellectual property 2,284 2,284 — $ 2,284 $ 2,284 $ — December 31, 2022 Subscriber relationships $ 7,649 $ 7,245 $ 404 Distribution rights 315 315 — Internally developed software 446 446 — Proprietary content 153 153 — Intellectual property 2,284 2,284 — $ 10,847 $ 10,443 $ 404 Amortization expense related to intangible assets was $19 and $90 for the three months ended September 30, 2023 and 2022, respectively, and $167 and $409 for the nine months ended September 30, 2023 and 2022, respectively. Amortization expense was categorized as general and administrative expense. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Revenue from Contracts with CustomersIn accordance with ASC 606, revenue is recognized when a customer obtains control of promised products and services. The amount of revenue recognized reflects the consideration which the Company expects to be entitled to receive in exchange for these products and services. Disaggregation of Revenue for Continuing Operations The following table summarizes net sales from contracts with customers for the three and nine months ended September 30, 2023 and 2022: Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Product, transferred at point in time $ 3,531 $ 5,974 $ 12,578 $ 18,057 Product, transferred over time 621 651 1,948 1,751 Service 29,397 28,544 86,883 83,065 Total net sales $ 33,549 $ 35,169 $ 101,409 $ 102,873 Revenue recognized during the three months ended September 30, 2023 and 2022 from amounts included in contract liabilities at the beginning of the period was $533 and $572, respectively. Revenue recognized during the nine months ended September 30, 2023 and 2022 from amounts included in contract liabilities at the beginning of the period was $1,826 and $1,645, respectively. For product sales, the delivery of the Company’s performance obligations is generally transferred to the customer, and associated revenue is recognized, at a point in time, with the exception of certain VSAT contracts which are transferred to customers over time. For service sales, the delivery of the Company’s performance obligations is transferred to the customer, and associated revenue is recognized, over time. The Company's performance is impacted by the levels of activity in the marine and land mobile markets, among other factors. Performance in any particular period could be impacted by the timing of sales to certain large customers. The Company primarily manufactures and distributes a comprehensive family of mobile satellite antenna products and services that provide access to the Internet, television, and VoIP services while on the move. Product sales accounted for 12% and 19% of the Company's consolidated net sales for the three months ended September 30, 2023 and 2022, respectively, and 14% and 19% of the Company's consolidated net sales for the nine months ended September 30, 2023 and 2022, respectively. Service sales of VSAT Broadband airtime service accounted for 82% and 76% of the Company's consolidated net sales for the three months ended September 30, 2023 and 2022, respectively, and 80% and 74% of the Company's consolidated net sales for the nine months ended September 30, 2023 and 2022, respectively. The balance of service sales is comprised of distribution of commercially licensed entertainment and news, product repairs, and extended warranty sales. No other single product class accounts for 10% or more of the Company's consolidated net sales. The Company operates in a number of major geographic areas, including internationally. Revenues from international locations primarily include Singapore, Canada, South America countries, European Union countries and other European countries, and countries in Africa, the Middle East and Asia/Pacific, including India. Revenues are based upon customer location and revenues from international locations represented 69% and 62% of consolidated net sales for the three months ended September 30, 2023 and 2022, respectively, and 67% and 61% of consolidated net sales for the nine months ended September 30, 2023 and 2022, respectively. Sales to Singapore customers represented 18% and 17% of the Company's consolidated net sales for the three months ended September 30, 2023 and 2022, respectively. No other individual foreign country represented 10% or more of the Company's consolidated net sales for the three months ended September 30, 2023 or 2022. Sales to Singapore customers represented 18% and 16% of the Company's consolidated net sales for the nine months ended September 30, 2023 and 2022, respectively. No other individual foreign country represented 10% or more of the Company's consolidated net sales for the nine months ended September 30, 2023 or 2022. As of September 30, 2023 and December 31, 2022, the long-lived tangible assets related to the Company’s international subsidiaries were less than 10% of the Company’s long-lived tangible assets. Business and Credit Concentrations Concentrations of risk with respect to trade accounts receivable are generally limited due to the large number of customers and their dispersion across several geographic areas. Although the Company does not foresee that credit risk associated with these receivables will deviate from historical experience, repayment is dependent upon the financial stability of those individual customers. The Company establishes allowances for credit losses and evaluates, on a monthly basis, the adequacy of those reserves based upon expected losses, historical experience and its expectation for future collectability concerns. No single customer accounted for 10% or more of consolidated net sales for the nine months ended September 30, 2023 or 2022. Two customers accounted for approximately 18% and 11% of accounts receivable at September 30, 2023, respectively. Two customers accounted for approximately 16% and 12%, respectively, of accounts receivable at December 31, 2022. One customer accounted for 64% and 66% of long-term accounts receivable included in other non-current assets on the consolidated balance sheets related to sales-type leases at September 30, 2023 and December 31, 2022, respectively. Certain components from third parties used in the Company’s products are procured from single sources of supply. The failure of a supplier, including a subcontractor, to deliver on schedule could delay or interrupt the Company’s delivery of products and thereby materially adversely affect the Company’s revenues and operating results. Customer Contract Balances The following table provides the balance sheet location and amounts of contract assets, or unbilled accounts receivable, and contract liabilities, or deferred revenue, from contracts with customers as of September 30, 2023 and December 31, 2022: Contract Balance Type Balance Sheet Location September 30, 2023 December 31, 2022 Current portion of deferred costs Current contract assets $ 1,130 $ 1,243 Non-current portion of deferred costs Non-current contract assets 2,557 3,033 Current portion of deferred revenues Contract liabilities* 1,668 1,743 Non-current portion of deferred revenues Long-term contract liabilities 3,905 4,315 *Management notes that the remaining “Contract liabilities” balance not included in the above table (which as of September 30, 2023 and December 31, 2022 is $1,600 and $1,365, respectively) relates to deferred income unaffiliated with the Company’s primary revenue streams, the majority of which relates to our content subscription business. These values are therefore excluded from the contract assets and contract liabilities from contracts with customers. There were no material changes to contract asset balances for the nine months ended September 30, 2023 as a result of changes in estimates or impairments. The change in the contract liability balance from December 31, 2022 to September 30, 2023 was primarily due to the increase in upfront support billings received in the first nine months of 2023 in comparison to revenues recognized in the prior period from historical support billings. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s effective tax rate from continuing operations for the three and nine months ended September 30, 2023 was (2.3)% and (5.0)%, respectively, compared with (578.6)% and (16.5)% for the corresponding periods in the prior year. The effective income tax rate is based on estimated income for the year, the estimated composition of the income in different jurisdictions and discrete adjustments, if any, in the applicable periods, including retroactive changes in tax legislation, settlements of tax audits or assessments, and the resolution or identification of tax position uncertainties. For the three and nine months ended September 30, 2023 and 2022, the effective tax rates from continuing operations differed from the statutory tax rate primarily due to the Company maintaining a valuation allowance reserve on its U.S. deferred tax assets, discrete tax adjustments and the composition of income from foreign jurisdictions taxed at lower rates. As of September 30, 2023 and December 31, 2022, the Company had reserves for uncertain tax positions of $693 and $637, respectively. There were no material changes during the nine months ended September 30, 2023 to the Company’s reserve for uncertain tax positions. The Company estimates that it is reasonably possible that the balance of unrecognized tax benefits as of September 30, 2023 may decrease $38 in the next twelve months as a result of a lapse of statutes of limitations and settlements with taxing authorities. The Company’s tax jurisdictions include the United States, the United Kingdom, Denmark, Cyprus, Norway, Brazil, Singapore, Japan and India. In general, the statute of limitations with respect to the Company's United States federal income taxes has expired for years prior to 2019, and the relevant state and foreign statutes vary. However, preceding years remain open to examination by United States federal and state and foreign taxing authorities to the extent of future utilization of net operating losses and research and development tax credits generated in each preceding year. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Leases | Leases Lessee The Company has operating leases for office facilities, equipment, and satellite service capacity and related equipment. Lease expense from continuing operations was $417 and $507 for the three months ended September 30, 2023 and 2022, respectively, and was $1,291 and $1,588 for the nine months ended September 30, 2023 and 2022, respectively. Short-term operating lease costs were $15 and $41 for the three months ended September 30, 2023 and 2022, respectively, and were $55 and $139 for the nine months ended September 30, 2023 and 2022, respectively. Maturities of lease liabilities as of September 30, 2023 under operating leases having an initial or remaining non-cancelable term of one year or more are as follows: Remainder of 2023 $ 400 2024 629 2025 93 2026 47 2027 and thereafter 79 Total minimum lease payments $ 1,248 Less amount representing interest $ (55) Present value of net minimum operating lease payments $ 1,193 Less current installments of obligation under current-operating lease liabilities $ 921 Obligations under long-term operating lease liabilities, excluding current installments $ 272 Weighted-average remaining lease term - operating leases (years) 1.53 Weighted-average discount rate - operating leases 5.50 % Lessor The Company enters into leases with certain customers primarily for the TracPhone VSAT systems. These leases are classified as sales-type leases because title to the equipment transfers to the customer at the end of the lease term. The Company records the leases at a price typically equivalent to normal selling price and in excess of the cost or carrying amount. Upon delivery, the Company records the net present value of all payments under these leases as product revenue, and the related costs of the product are charged to cost of sales. Interest income is recognized throughout the lease term (typically three The current portion of the net investment in these leases was $3,739 as of September 30, 2023 and the non-current portion of the net investment in these leases was $3,984 as of September 30, 2023. The current portion of the net investment in the leases is included in accounts receivable, net of allowance for doubtful accounts on the accompanying consolidated balance sheets and the non-current portion of the net investment in these leases is included in other non-current assets on the accompanying consolidated balance sheets. Interest income from sales-type leases was $159 and $191 during the three months ended September 30, 2023 and 2022, respectively, and was $501 and $591 during the nine months ended September 30, 2023 and 2022, respectively. The future undiscounted cash flows from these leases as of September 30, 2023 are: Remainder of 2023 $ 1,547 2024 3,346 2025 2,016 2026 1,033 2027 514 2028 98 Total undiscounted cash flows $ 8,554 Present value of lease payments $ 7,723 Difference between undiscounted cash flows and discounted cash flows $ 831 In 2021, the Company began entering into three-year leases for its TracPhone VSAT systems, in which ownership of the hardware does not transfer to the lessee by the end of the lease term. As a result, and in light of other factors indicated in ASC 842, these leases are classified as operating leases. As of September 30, 2023, the gross costs and accumulated depreciation associated with these operating leases are included in revenue generating assets and amounted to $1,880 and $798, respectively. They are depreciated on a straight-line basis over a five-year estimated useful life. Depreciation expense for these assets was $94 and $282 for the three and nine months ended September 30, 2023, respectively. Lease revenue recognized was $138 and $415 for the three and nine months ended September 30, 2023, respectively, in service sales As of September 30, 2023, minimum future lease payments to be recognized on the operating leases are as follows: Remainder of 2023 $ 138 2024 343 2025 25 Total $ 506 |
Leases | Leases Lessee The Company has operating leases for office facilities, equipment, and satellite service capacity and related equipment. Lease expense from continuing operations was $417 and $507 for the three months ended September 30, 2023 and 2022, respectively, and was $1,291 and $1,588 for the nine months ended September 30, 2023 and 2022, respectively. Short-term operating lease costs were $15 and $41 for the three months ended September 30, 2023 and 2022, respectively, and were $55 and $139 for the nine months ended September 30, 2023 and 2022, respectively. Maturities of lease liabilities as of September 30, 2023 under operating leases having an initial or remaining non-cancelable term of one year or more are as follows: Remainder of 2023 $ 400 2024 629 2025 93 2026 47 2027 and thereafter 79 Total minimum lease payments $ 1,248 Less amount representing interest $ (55) Present value of net minimum operating lease payments $ 1,193 Less current installments of obligation under current-operating lease liabilities $ 921 Obligations under long-term operating lease liabilities, excluding current installments $ 272 Weighted-average remaining lease term - operating leases (years) 1.53 Weighted-average discount rate - operating leases 5.50 % Lessor The Company enters into leases with certain customers primarily for the TracPhone VSAT systems. These leases are classified as sales-type leases because title to the equipment transfers to the customer at the end of the lease term. The Company records the leases at a price typically equivalent to normal selling price and in excess of the cost or carrying amount. Upon delivery, the Company records the net present value of all payments under these leases as product revenue, and the related costs of the product are charged to cost of sales. Interest income is recognized throughout the lease term (typically three The current portion of the net investment in these leases was $3,739 as of September 30, 2023 and the non-current portion of the net investment in these leases was $3,984 as of September 30, 2023. The current portion of the net investment in the leases is included in accounts receivable, net of allowance for doubtful accounts on the accompanying consolidated balance sheets and the non-current portion of the net investment in these leases is included in other non-current assets on the accompanying consolidated balance sheets. Interest income from sales-type leases was $159 and $191 during the three months ended September 30, 2023 and 2022, respectively, and was $501 and $591 during the nine months ended September 30, 2023 and 2022, respectively. The future undiscounted cash flows from these leases as of September 30, 2023 are: Remainder of 2023 $ 1,547 2024 3,346 2025 2,016 2026 1,033 2027 514 2028 98 Total undiscounted cash flows $ 8,554 Present value of lease payments $ 7,723 Difference between undiscounted cash flows and discounted cash flows $ 831 In 2021, the Company began entering into three-year leases for its TracPhone VSAT systems, in which ownership of the hardware does not transfer to the lessee by the end of the lease term. As a result, and in light of other factors indicated in ASC 842, these leases are classified as operating leases. As of September 30, 2023, the gross costs and accumulated depreciation associated with these operating leases are included in revenue generating assets and amounted to $1,880 and $798, respectively. They are depreciated on a straight-line basis over a five-year estimated useful life. Depreciation expense for these assets was $94 and $282 for the three and nine months ended September 30, 2023, respectively. Lease revenue recognized was $138 and $415 for the three and nine months ended September 30, 2023, respectively, in service sales As of September 30, 2023, minimum future lease payments to be recognized on the operating leases are as follows: Remainder of 2023 $ 138 2024 343 2025 25 Total $ 506 |
Leases | Leases Lessee The Company has operating leases for office facilities, equipment, and satellite service capacity and related equipment. Lease expense from continuing operations was $417 and $507 for the three months ended September 30, 2023 and 2022, respectively, and was $1,291 and $1,588 for the nine months ended September 30, 2023 and 2022, respectively. Short-term operating lease costs were $15 and $41 for the three months ended September 30, 2023 and 2022, respectively, and were $55 and $139 for the nine months ended September 30, 2023 and 2022, respectively. Maturities of lease liabilities as of September 30, 2023 under operating leases having an initial or remaining non-cancelable term of one year or more are as follows: Remainder of 2023 $ 400 2024 629 2025 93 2026 47 2027 and thereafter 79 Total minimum lease payments $ 1,248 Less amount representing interest $ (55) Present value of net minimum operating lease payments $ 1,193 Less current installments of obligation under current-operating lease liabilities $ 921 Obligations under long-term operating lease liabilities, excluding current installments $ 272 Weighted-average remaining lease term - operating leases (years) 1.53 Weighted-average discount rate - operating leases 5.50 % Lessor The Company enters into leases with certain customers primarily for the TracPhone VSAT systems. These leases are classified as sales-type leases because title to the equipment transfers to the customer at the end of the lease term. The Company records the leases at a price typically equivalent to normal selling price and in excess of the cost or carrying amount. Upon delivery, the Company records the net present value of all payments under these leases as product revenue, and the related costs of the product are charged to cost of sales. Interest income is recognized throughout the lease term (typically three The current portion of the net investment in these leases was $3,739 as of September 30, 2023 and the non-current portion of the net investment in these leases was $3,984 as of September 30, 2023. The current portion of the net investment in the leases is included in accounts receivable, net of allowance for doubtful accounts on the accompanying consolidated balance sheets and the non-current portion of the net investment in these leases is included in other non-current assets on the accompanying consolidated balance sheets. Interest income from sales-type leases was $159 and $191 during the three months ended September 30, 2023 and 2022, respectively, and was $501 and $591 during the nine months ended September 30, 2023 and 2022, respectively. The future undiscounted cash flows from these leases as of September 30, 2023 are: Remainder of 2023 $ 1,547 2024 3,346 2025 2,016 2026 1,033 2027 514 2028 98 Total undiscounted cash flows $ 8,554 Present value of lease payments $ 7,723 Difference between undiscounted cash flows and discounted cash flows $ 831 In 2021, the Company began entering into three-year leases for its TracPhone VSAT systems, in which ownership of the hardware does not transfer to the lessee by the end of the lease term. As a result, and in light of other factors indicated in ASC 842, these leases are classified as operating leases. As of September 30, 2023, the gross costs and accumulated depreciation associated with these operating leases are included in revenue generating assets and amounted to $1,880 and $798, respectively. They are depreciated on a straight-line basis over a five-year estimated useful life. Depreciation expense for these assets was $94 and $282 for the three and nine months ended September 30, 2023, respectively. Lease revenue recognized was $138 and $415 for the three and nine months ended September 30, 2023, respectively, in service sales As of September 30, 2023, minimum future lease payments to be recognized on the operating leases are as follows: Remainder of 2023 $ 138 2024 343 2025 25 Total $ 506 |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Sep. 30, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations During the third quarter of 2022, the Company sold its inertial navigation business. The Company determined that the sale met the requirements for reporting as discontinued operations in accordance with Accounting Standards Codification (ASC) 205-20. There were no assets or liabilities of the inertial navigation business as of December 31, 2022 or September 30, 2023. Please see Note 1 for further discussion. The following table presents a reconciliation of the major financial line items constituting the results for discontinued operations to the net income from discontinued operations, net of tax, presented separately in the Company's consolidated statement of operations for the three and nine months ended 2022: Three Months Ended Nine Months Ended September 30, September 30, 2022 2022 Sales: Product $ 1,276 $ 16,042 Service 218 679 Net sales 1,494 16,721 Costs and expenses: Costs of product sales 1,504 12,732 Costs of service sales 169 457 Research and development 374 3,147 Sales, marketing and support 348 3,035 Other income, net 12 81 Loss from discontinued operations before income tax expense (889) (2,569) Gain on sale of discontinued operations before tax expense 30,858 30,858 Total income from discontinued operations before tax expense $ 29,969 $ 28,289 Income tax expense on discontinued operations 228 228 Net income from discontinued operations, net of tax $ 29,741 $ 28,061 Net income from discontinued operations per common share Basic $ 1.59 $ 1.51 Diluted $ 1.59 $ 1.51 Weighted average number of common shares outstanding: Basic 18,706 18,574 Diluted 18,706 18,574 The following table presents supplemental cash flow information of the discontinued operations: Three Months Ended Nine Months Ended September 30, September 30, 2022 2022 Cash used in operating activities - discontinued operations $ (252) $ (3,853) Cash used in investing activities - discontinued operations $ (220) $ (307) The following table presents non-cash expenses from discontinued operations: Three Months Ended Nine Months Ended September 30, September 30, 2022 2022 Depreciation $ 91 $ 622 Compensation expense related to stock-based awards and employee stock purchase plan $ 237 $ 475 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated interim financial statements of KVH Industries, Inc. and its wholly owned subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America. The Company has evaluated all subsequent events through the date of this filing. All significant intercompany accounts and transactions have been eliminated in consolidation. The 2022 consolidated interim financial statements reflect the sale of the inertial navigation business as discontinued operations. See Notes 1 and 16 for further information on the sale of the inertial navigation business. The consolidated interim financial statements have not been audited by the Company’s independent registered public accounting firm and include all adjustments (consisting of only normal recurring adjustments) which are, in the opinion of management, necessary for a fair presentation of the financial condition, results of operations, and cash flows for the periods presented. These consolidated interim financial statements do not include all disclosures associated with annual financial statements and accordingly should be read in conjunction with the Company’s consolidated financial statements and related notes included in the Company’s annual report on Form 10-K for the year ended December 31, 2022 filed on March 16, 2023 with the Securities and Exchange Commission. The results for the three and nine months ended September 30, 2023 are not necessarily indicative of operating results for the remainder of the year. |
Significant Estimates and Assumptions and Other Significant Non-Recurring Transactions | Significant Estimates and Assumptions and Other Significant Non-Recurring Transactions The preparation of interim financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the interim financial statements and the reported amounts of sales and expenses during the reporting periods. As described in the Company’s annual report on Form 10-K, the estimates and assumptions used by management affect the Company’s revenue recognition, valuation of accounts receivable, valuation of inventory, expected future cash flows including growth rates, discount rates, terminal values and other assumptions and estimates used to evaluate the recoverability of long-lived assets and goodwill, estimated fair values of long-lived assets, including goodwill, amortization methods and periods, certain accrued expenses and other related charges, stock-based compensation, contingent liabilities, forfeitures and key valuation assumptions for its share-based awards, estimated fulfillment costs for warranty obligations, tax reserves and recoverability of the Company’s net deferred tax assets and related valuation allowance, and the valuation of right-of-use assets and lease liabilities. |
Accounting Standards Issued and Not Yet Adopted | Recently Issued Accounting Standards and Accounting Standards Not yet AdoptedThere are no recent accounting pronouncements issued by the FASB, but not yet effective, that the Company expects would have a material impact on the Company's financial statements. |
Stock Equity and Incentive Plan | The Company recognizes stock-based compensation in accordance with the provisions of ASC Topic 718, Compensation-Stock Compensation |
Fair Value Measurement | ASC Topic 820, Fair Value Measurements and Disclosures (ASC 820), provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. The Company’s Level 1 assets are investments in money market mutual funds and United States treasuries. Level 2: Quoted prices for similar assets or liabilities in active markets; or observable prices that are based on observable market data, based on directly or indirectly market-corroborated inputs. The Company has no Level 2 assets or liabilities. Level 3: Unobservable inputs that are supported by little or no market activity, and are developed based on the best information available given the circumstances. The Company has no Level 3 assets. |
Marketable Securities (Tables)
Marketable Securities (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Marketable Securities [Abstract] | |
Marketable Securities | Marketable securities as of September 30, 2023 and December 31, 2022 consisted of the following: September 30, 2023 Amortized Gross Gross Fair Money market mutual funds $ 57,710 $ — $ — $ 57,710 United States treasuries — — — — Total marketable securities designated as available-for-sale $ 57,710 $ — $ — $ 57,710 December 31, 2022 Amortized Gross Gross Fair Money market mutual funds $ 30,977 $ — $ — $ 30,977 United States treasuries 24,715 — (12) 24,703 Total marketable securities designated as available-for-sale $ 55,692 $ — $ (12) $ 55,680 |
Stockholder's Equity (Tables)
Stockholder's Equity (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement, Noncash Expense [Abstract] | |
Schedule of share-based payment award, stock options, valuation assumptions | The weighted average assumptions utilized to determine the fair value of options granted during the nine months ended September 30, 2023 and 2022 are as follows: Nine Months Ended September 30, 2023 2022 Risk-free interest rate 4.49 % 2.97 % Expected volatility 43.93 % 43.16 % Expected life (in years) 4.30 4.24 Dividend yield 0 % 0 % |
Schedule of share-based compensation, employee stock purchase plan | The following table presents stock-based compensation expense, including expense for the ESPP, in the Company's consolidated statements of operations for the three and nine months ended September 30, 2023 and 2022: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Cost of product sales $ 9 $ 333 $ 25 $ 468 Cost of service sales 6 3 15 8 Research and development 162 371 399 702 Sales, marketing and support 63 14 160 225 General and administrative 319 388 834 1,292 $ 559 $ 1,109 $ 1,433 $ 2,695 |
Schedule of accumulated other comprehensive income (loss) | The balances for the three months ended September 30, 2023 and 2022 are as follows: Foreign Currency Translation Total Accumulated Other Comprehensive Loss Balance, June 30, 2023 $ (3,955) $ (3,955) Other comprehensive loss (267) (267) Net other comprehensive loss (267) (267) Balance, September 30, 2023 $ (4,222) $ (4,222) Foreign Currency Translation Total Accumulated Other Comprehensive Loss Balance, June 30, 2022 $ (4,021) $ (4,021) Other comprehensive loss (646) (646) Net other comprehensive loss (646) (646) Balance, September 30, 2022 $ (4,667) $ (4,667) The balances for the nine months ended September 30, 2023 and 2022 are as follows: Foreign Currency Translation Unrealized (Loss) Gain on Available for Sale Marketable Securities Total Accumulated Other Comprehensive Loss Balance, December 31, 2022 $ (4,098) $ (12) $ (4,110) Other comprehensive (loss) income (124) 12 (112) Net other comprehensive (loss) income (124) 12 (112) Balance, September 30, 2023 $ (4,222) $ — $ (4,222) Foreign Currency Translation Total Accumulated Other Comprehensive Loss Balance, December 31, 2021 $ (3,409) $ (3,409) Other comprehensive loss (1,258) (1,258) Net other comprehensive loss (1,258) (1,258) Balance, September 30, 2022 $ (4,667) $ (4,667) |
Net (Loss) Income from Contin_2
Net (Loss) Income from Continuing Operations per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of basic and diluted weighted average common shares outstanding | A reconciliation of the basic and diluted weighted average common shares outstanding is as follows: Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Weighted average common shares outstanding—basic 19,231 18,706 19,090 18,574 Dilutive common shares issuable in connection with stock plans — — — — Weighted average common shares outstanding—diluted 19,231 18,706 19,090 18,574 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Components of inventories | Components of inventories consist of the following: September 30, December 31, Raw materials $ 15,325 $ 14,203 Work in process 4,083 4,164 Finished goods 7,015 4,363 $ 26,423 $ 22,730 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and equipment, net, as of September 30, 2023 and December 31, 2022 consist of the following: September 30, December 31, Land $ 2,833 $ 2,833 Building and improvements 18,839 18,869 Leasehold improvements 439 513 Machinery and equipment 5,927 5,948 Revenue-generating assets 75,440 72,527 Office and computer equipment 13,613 14,652 Motor vehicles 31 31 117,122 115,373 Less accumulated depreciation (67,715) (62,255) $ 49,407 $ 53,118 |
Product Warranty (Tables)
Product Warranty (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Product Warranties Disclosures [Abstract] | |
Summary of product warranty activity | The following table summarizes product warranty activity during 2023 and 2022: Nine Months Ended September 30, 2023 2022 Beginning balance $ 1,287 $ 1,084 Charges to expense 521 964 Costs incurred (1,166) (764) Ending balance $ 642 $ 1,284 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets measured at fair value on recurring basis | The following tables present financial assets and liabilities at September 30, 2023 and December 31, 2022 for which the Company measures fair value on a recurring basis, by level, within the fair value hierarchy: September 30, 2023 Total Level 1 Level 2 Level 3 Valuation Assets Money market mutual funds $ 57,710 $ 57,710 $ — $ — (a) December 31, 2022 Total Level 1 Level 2 Level 3 Valuation Assets Money market mutual funds $ 30,977 $ 30,977 $ — $ — (a) United States treasuries $ 24,703 $ 24,703 $ — $ — (a) (a) Market approach—prices and other relevant information generated by market transactions involving identical or comparable assets. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The following table sets forth the changes in the carrying amount of goodwill for the nine months ended September 30, 2023: Amounts Balance at December 31, 2022 $ 5,308 Impairment (5,333) Foreign currency translation adjustment 25 Balance at September 30, 2023 $ — |
Schedule of finite-lived intangible assets | The changes in the carrying amount of intangible assets during the nine months ended September 30, 2023 are as follows: Amounts Balance at December 31, 2022 $ 404 Amortization expense (167) Intangible assets acquired in asset acquisition 35 Impairment (274) Foreign currency translation adjustment 2 Balance at September 30, 2023 $ — Acquired intangible assets are subject to amortization. The following table summarizes acquired intangible assets at September 30, 2023 and December 31, 2022, respectively: Gross Carrying Amount Accumulated Amortization Net Carrying Value September 30, 2023 Subscriber relationships $ — $ — $ — Distribution rights — — — Internally developed software — — — Proprietary content — — — Intellectual property 2,284 2,284 — $ 2,284 $ 2,284 $ — December 31, 2022 Subscriber relationships $ 7,649 $ 7,245 $ 404 Distribution rights 315 315 — Internally developed software 446 446 — Proprietary content 153 153 — Intellectual property 2,284 2,284 — $ 10,847 $ 10,443 $ 404 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of revenue | The following table summarizes net sales from contracts with customers for the three and nine months ended September 30, 2023 and 2022: Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Product, transferred at point in time $ 3,531 $ 5,974 $ 12,578 $ 18,057 Product, transferred over time 621 651 1,948 1,751 Service 29,397 28,544 86,883 83,065 Total net sales $ 33,549 $ 35,169 $ 101,409 $ 102,873 |
Schedule of customer contract balances | The following table provides the balance sheet location and amounts of contract assets, or unbilled accounts receivable, and contract liabilities, or deferred revenue, from contracts with customers as of September 30, 2023 and December 31, 2022: Contract Balance Type Balance Sheet Location September 30, 2023 December 31, 2022 Current portion of deferred costs Current contract assets $ 1,130 $ 1,243 Non-current portion of deferred costs Non-current contract assets 2,557 3,033 Current portion of deferred revenues Contract liabilities* 1,668 1,743 Non-current portion of deferred revenues Long-term contract liabilities 3,905 4,315 *Management notes that the remaining “Contract liabilities” balance not included in the above table (which as of September 30, 2023 and December 31, 2022 is $1,600 and $1,365, respectively) relates to deferred income unaffiliated with the Company’s primary revenue streams, the majority of which relates to our content subscription business. These values are therefore excluded from the contract assets and contract liabilities from contracts with customers. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Future minimum lease payments under operating leases | Maturities of lease liabilities as of September 30, 2023 under operating leases having an initial or remaining non-cancelable term of one year or more are as follows: Remainder of 2023 $ 400 2024 629 2025 93 2026 47 2027 and thereafter 79 Total minimum lease payments $ 1,248 Less amount representing interest $ (55) Present value of net minimum operating lease payments $ 1,193 Less current installments of obligation under current-operating lease liabilities $ 921 Obligations under long-term operating lease liabilities, excluding current installments $ 272 Weighted-average remaining lease term - operating leases (years) 1.53 Weighted-average discount rate - operating leases 5.50 % |
Sales-type lease, future undiscounted cash flows | The future undiscounted cash flows from these leases as of September 30, 2023 are: Remainder of 2023 $ 1,547 2024 3,346 2025 2,016 2026 1,033 2027 514 2028 98 Total undiscounted cash flows $ 8,554 Present value of lease payments $ 7,723 Difference between undiscounted cash flows and discounted cash flows $ 831 |
Future minimum lease payments to be received under operating leases | As of September 30, 2023, minimum future lease payments to be recognized on the operating leases are as follows: Remainder of 2023 $ 138 2024 343 2025 25 Total $ 506 |
Discontinued Operations - (Tabl
Discontinued Operations - (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The following table presents a reconciliation of the major financial line items constituting the results for discontinued operations to the net income from discontinued operations, net of tax, presented separately in the Company's consolidated statement of operations for the three and nine months ended 2022: Three Months Ended Nine Months Ended September 30, September 30, 2022 2022 Sales: Product $ 1,276 $ 16,042 Service 218 679 Net sales 1,494 16,721 Costs and expenses: Costs of product sales 1,504 12,732 Costs of service sales 169 457 Research and development 374 3,147 Sales, marketing and support 348 3,035 Other income, net 12 81 Loss from discontinued operations before income tax expense (889) (2,569) Gain on sale of discontinued operations before tax expense 30,858 30,858 Total income from discontinued operations before tax expense $ 29,969 $ 28,289 Income tax expense on discontinued operations 228 228 Net income from discontinued operations, net of tax $ 29,741 $ 28,061 Net income from discontinued operations per common share Basic $ 1.59 $ 1.51 Diluted $ 1.59 $ 1.51 Weighted average number of common shares outstanding: Basic 18,706 18,574 Diluted 18,706 18,574 The following table presents supplemental cash flow information of the discontinued operations: Three Months Ended Nine Months Ended September 30, September 30, 2022 2022 Cash used in operating activities - discontinued operations $ (252) $ (3,853) Cash used in investing activities - discontinued operations $ (220) $ (307) The following table presents non-cash expenses from discontinued operations: Three Months Ended Nine Months Ended September 30, September 30, 2022 2022 Depreciation $ 91 $ 622 Compensation expense related to stock-based awards and employee stock purchase plan $ 237 $ 475 |
Description of Business (Detail
Description of Business (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 09, 2022 USD ($) extensionOption | Sep. 30, 2023 USD ($) country | Sep. 30, 2023 USD ($) reportableSegment country | Sep. 30, 2022 USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Number of countries in which entity operates | country | 150 | 150 | ||
Transition Services Agreement | $ (13) | $ 710 | ||
Number of reportable segments | reportableSegment | 1 | |||
Revenue-generating assets | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Leased assets, useful life | 5 years | 5 years | ||
Intertial Navigation | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from the sale of KVH Media Group Entertainment Limited, net of cash sold | $ 0 | $ 55,000 | ||
Intertial Navigation | Intertial Navigation | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from the sale of KVH Media Group Entertainment Limited, net of cash sold | $ 54,904 | |||
Transition support service period | 6 months | |||
Transition support service, number of extensions | extensionOption | 2 | |||
Transition support service, extension period | 3 months | |||
Monthly transaction fees | $ 100 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Oct. 11, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Accounting Policies [Line Items] | |||||
Foreign currency exchange gains (losses) | $ 92 | $ 450 | $ (18) | $ 1,009 | |
Accrued employee benefits | $ 286 | $ 286 | |||
Chief Operating Officer | |||||
Accounting Policies [Line Items] | |||||
Annual base salary | $ 448 | ||||
Percent of base salary, second half of year | 80% | ||||
Retention bonus, percent of base salary | 75% | ||||
Retention bonus, percent of highest base salary | 75% | ||||
Chief Operating Officer | Restricted Stock And Non-Statutory Stock Options | |||||
Accounting Policies [Line Items] | |||||
Aggregate grant date fair value | $ 100 |
Marketable Securities (Details)
Marketable Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 57,710 | $ 55,692 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | (12) |
Fair Value | 57,710 | 55,680 |
Money market mutual funds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 57,710 | 30,977 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 57,710 | 30,977 |
United States treasuries | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 0 | 24,715 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | (12) |
Fair Value | $ 0 | $ 24,703 |
Marketable Securities - Narrati
Marketable Securities - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Marketable Securities [Abstract] | ||||
Interest income, money market deposits | $ 744 | $ 193 | $ 2,019 | $ 203 |
Stockholder's Equity - Narrativ
Stockholder's Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Jun. 08, 2022 | Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Jun. 07, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based payment | $ 559 | $ 1,109 | $ 1,433 | $ 2,695 | ||||
Proceeds from stock options exercised and employee stock purchase plan | 2,604 | $ 796 | ||||||
Acquisition of treasury stock (in shares) | 23,000 | 0 | ||||||
Stock Options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Increase in shares authorized (in shares) | 1,280 | |||||||
Shares authorized (in shares) | 6,080 | 4,800 | ||||||
Unrecognized compensation expense | $ 2,272 | $ 2,272 | ||||||
Weighted-average period of recognition | 2 years 7 months 28 days | |||||||
Shares issued (in shares) | 14,000 | 274,000 | ||||||
Proceeds from stock options exercised and employee stock purchase plan | $ 113 | $ 2,480 | ||||||
Restricted stock surrendered (in shares) | 0 | 0 | ||||||
Stock options granted (in shares) | 0 | 317,000 | 398,000 | |||||
Stock options expired (in shares) | 133,000 | 564,000 | ||||||
Stock options outstanding (in shares) | 1,230,000 | 1,230,000 | ||||||
Stock options outstanding, weighted average exercise price (in USD per share) | $ 9.57 | $ 9.57 | ||||||
Stock options exercisable (in shares) | 510,000 | 510,000 | ||||||
Exercisable stock options, weighted average exercise price (in USD per share) | $ 9.56 | $ 9.56 | ||||||
Stock Options | ESPP Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based payment | $ 558 | 1,103 | $ 1,408 | $ 2,663 | ||||
Employee Stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based payment | $ 1 | $ 6 | ||||||
Employee Stock | ESPP Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based payment | $ 25 | $ 32 | ||||||
Percentage of Company's common stock share price | 85% | 85% | ||||||
Stock options issued ESPP (in shares) | 17,000 | 0 | 17,000 | 22,000 | ||||
Restricted Stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Unrecognized compensation expense | $ 2,953 | $ 2,953 | ||||||
Weighted-average period of recognition | 2 years 6 months 7 days | |||||||
Restricted stock surrendered (in shares) | 0 | 0 | ||||||
Restricted stock (in shares) | 66,000 | 217,000 | ||||||
Restricted stock, weighted average price (in USD per share) | $ 8.75 | $ 9.49 | ||||||
Restricted stock award, forfeitures, less than (in shares) | 0 | 72,000 | ||||||
Restricted stock vested (in shares) | 7,000 | 101,000 | ||||||
Unvested outstanding options (in shares) | 0 | 0 | ||||||
Performance-Based or Market-Based Shares | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Unvested outstanding options (in shares) | 0 | 0 |
Stockholder's Equity Weighted A
Stockholder's Equity Weighted Average Assumptions (Details) - Stock Options | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate | 4.49% | 2.97% |
Expected volatility | 43.93% | 43.16% |
Expected life (in years) | 4 years 3 months 18 days | 4 years 2 months 26 days |
Dividend yield | 0% | 0% |
Stockholder's Equity - Schedule
Stockholder's Equity - Schedule of Stock Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment | $ 559 | $ 1,109 | $ 1,433 | $ 2,695 |
Cost of Sales | Product | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment | 9 | 333 | 25 | 468 |
Cost of Sales | Service | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment | 6 | 3 | 15 | 8 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment | 162 | 371 | 399 | 702 |
Sales, marketing and support | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment | 63 | 14 | 160 | 225 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment | $ 319 | $ 388 | $ 834 | $ 1,292 |
Stockholder's Equity - Schedu_2
Stockholder's Equity - Schedule of AOCL (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | ||
AOCI Attributable to Parent [Roll Forward] | |||||
Beginning balance | $ 160,704 | $ 124,028 | $ 156,656 | $ 128,977 | |
Other comprehensive loss | (267) | (646) | (112) | (1,258) | |
Net other comprehensive loss | [1] | (267) | (646) | (112) | (1,258) |
Ending balance | 157,007 | 154,588 | 157,007 | 154,588 | |
Foreign Currency Translation | |||||
AOCI Attributable to Parent [Roll Forward] | |||||
Beginning balance | (3,955) | (4,021) | (4,098) | (3,409) | |
Other comprehensive loss | (267) | (646) | (124) | (1,258) | |
Net other comprehensive loss | (267) | (646) | (124) | (1,258) | |
Ending balance | (4,222) | (4,667) | (4,222) | (4,667) | |
Unrealized Loss on Available for Sale Marketable Securities | |||||
AOCI Attributable to Parent [Roll Forward] | |||||
Beginning balance | (12) | ||||
Other comprehensive loss | 12 | ||||
Net other comprehensive loss | 12 | ||||
Ending balance | 0 | 0 | |||
Total Accumulated Other Comprehensive Loss | |||||
AOCI Attributable to Parent [Roll Forward] | |||||
Beginning balance | (3,955) | (4,021) | (4,110) | (3,409) | |
Net other comprehensive loss | (267) | (646) | (112) | (1,258) | |
Ending balance | $ (4,222) | $ (4,667) | $ (4,222) | $ (4,667) | |
[1]Tax impact was nominal for all periods. |
Net (Loss) Income from Contin_3
Net (Loss) Income from Continuing Operations per Common Share - Narrative (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Earnings Per Share [Abstract] | ||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 1,572 | 1,572 | 1,053 | 1,763 |
Net (Loss) Income from Contin_4
Net (Loss) Income from Continuing Operations per Common Share - Reconciliation of Basic and Diluted Weighted Average Common Shares Outstanding (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Schedule of reconciliation of basic and diluted weighted average common shares outstanding | ||||
Weighted average common shares outstanding - basic (in shares) | 19,231 | 18,706 | 19,090 | 18,574 |
Dilutive common shares issuable in connection with stock plans (in shares) | 0 | 0 | 0 | 0 |
Weighted average common shares outstanding - diluted (in shares) | 19,231 | 18,706 | 19,090 | 18,574 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 15,325 | $ 14,203 |
Work in process | 4,083 | 4,164 |
Finished goods | 7,015 | 4,363 |
Inventories, net | $ 26,423 | $ 22,730 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 117,122 | $ 115,373 |
Less accumulated depreciation | (67,715) | (62,255) |
Property and equipment, less accumulated depreciation | 49,407 | 53,118 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,833 | 2,833 |
Building and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 18,839 | 18,869 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 439 | 513 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 5,927 | 5,948 |
Revenue-generating assets | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 75,440 | 72,527 |
Office and computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 13,613 | 14,652 |
Motor vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 31 | $ 31 |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Property, Plant and Equipment [Line Items] | ||||
Depreciation | $ 3,180 | $ 3,283 | $ 9,952 | $ 9,591 |
KVH Media Group | ||||
Property, Plant and Equipment [Line Items] | ||||
Net assets | $ 383 | $ 383 |
Product Warranty - Narrative (D
Product Warranty - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
Product Warranty (Textual) [Abstract] | ||
Accrued product warranty costs | $ 642 | $ 1,287 |
Minimum | ||
Product Warranty (Textual) [Abstract] | ||
Limited warranty period on product | 1 year | |
Maximum | ||
Product Warranty (Textual) [Abstract] | ||
Limited warranty period on product | 2 years |
Product Warranty - Schedule of
Product Warranty - Schedule of Product Warranty Activity (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Summary of product warranty activity | ||
Beginning balance | $ 1,287 | $ 1,084 |
Charges to expense | 521 | 964 |
Costs incurred | (1,166) | (764) |
Ending balance | $ 642 | $ 1,284 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Money market mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | $ 57,710 | $ 30,977 |
United States treasuries | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 24,703 | |
Level 1 | Money market mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 57,710 | 30,977 |
Level 1 | United States treasuries | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 24,703 | |
Level 2 | Money market mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 0 | 0 |
Level 2 | United States treasuries | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 0 | |
Level 3 | Money market mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | $ 0 | 0 |
Level 3 | United States treasuries | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | ||
Long-lived assets impairment charge | $ 5,990,000 | $ 0 |
Goodwill and other intangible asset impairment | $ 0 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) reportingUnit | Sep. 30, 2022 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | ||||
Number of reporting units | reportingUnit | 2 | |||
Goodwill impairment charge | $ 5,333 | $ 0 | $ 5,333 | $ 0 |
Long-lived assets impairment charge | 657 | 0 | 657 | 0 |
Amortization expense | 167 | |||
General and administrative | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization expense | $ 19 | $ 90 | $ 167 | $ 409 |
KVH Media Group | Subscriber relationships | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets, useful lives | 10 years | 10 years |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Goodwill Changes in Carrying Amount (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Goodwill [Roll Forward] | ||||
Beginning balance | $ 5,308 | |||
Goodwill impairment loss | $ (5,333) | $ 0 | (5,333) | $ 0 |
Foreign currency translation adjustment | 25 | |||
Ending balance | $ 0 | $ 0 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Intangible Assets Changes in Carrying Amount (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Finite-lived Intangible Assets [Roll Forward] | |
Beginning balance | $ 404 |
Amortization expense | (167) |
Intangible assets acquired in asset acquisition | 35 |
Impairment | (274) |
Foreign currency translation adjustment | 2 |
Ending balance | $ 0 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Goodwill and Intangible Assets Subject to Amortization (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 2,284 | $ 10,847 |
Accumulated Amortization | 2,284 | 10,443 |
Net Carrying Value | 0 | 404 |
Subscriber relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 0 | 7,649 |
Accumulated Amortization | 0 | 7,245 |
Net Carrying Value | 0 | 404 |
Distribution rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 0 | 315 |
Accumulated Amortization | 0 | 315 |
Net Carrying Value | 0 | 0 |
Internally developed software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 0 | 446 |
Accumulated Amortization | 0 | 446 |
Net Carrying Value | 0 | 0 |
Proprietary content | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 0 | 153 |
Accumulated Amortization | 0 | 153 |
Net Carrying Value | 0 | 0 |
Intellectual property | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,284 | 2,284 |
Accumulated Amortization | 2,284 | 2,284 |
Net Carrying Value | $ 0 | $ 0 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Total net sales | $ 33,549 | $ 35,169 | $ 101,409 | $ 102,873 |
Product | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | 4,152 | 6,625 | 14,526 | 19,808 |
Service | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | 29,397 | 28,544 | 86,883 | 83,065 |
Mobile Connectivity | Service | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | 29,397 | 28,544 | 86,883 | 83,065 |
Mobile Connectivity | Transferred at point in time | Product | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | 3,531 | 5,974 | 12,578 | 18,057 |
Mobile Connectivity | Transferred over time | Product | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | $ 621 | $ 651 | $ 1,948 | $ 1,751 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Disaggregation of Revenue [Line Items] | |||||
Revenue recognized | $ 533 | $ 572 | $ 1,826 | $ 1,645 | |
Revenue Benchmark | Product Concentration Risk | Mobile Comm Product Sales | |||||
Disaggregation of Revenue [Line Items] | |||||
Concentration risk | 12% | 19% | 14% | 19% | |
Revenue Benchmark | Product Concentration Risk | VSAT Airtime Service Sales | |||||
Disaggregation of Revenue [Line Items] | |||||
Concentration risk | 82% | 76% | 80% | 74% | |
Revenue Benchmark | Geographic Concentration Risk | Non-US | |||||
Disaggregation of Revenue [Line Items] | |||||
Concentration risk | 69% | 62% | 67% | 61% | |
Revenue Benchmark | Geographic Concentration Risk | Singapore | |||||
Disaggregation of Revenue [Line Items] | |||||
Concentration risk | 18% | 17% | 18% | 16% | |
Accounts Receivable | Customer Concentration Risk | Customer One | |||||
Disaggregation of Revenue [Line Items] | |||||
Concentration risk | 18% | 16% | |||
Accounts Receivable | Customer Concentration Risk | Customer Two | |||||
Disaggregation of Revenue [Line Items] | |||||
Concentration risk | 11% | 12% | |||
Accounts Receivable, Sales-Type Leases | Customer Concentration Risk | Customer Two | |||||
Disaggregation of Revenue [Line Items] | |||||
Concentration risk | 64% | 66% |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Schedule of Customer Contract Balances (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Current contract assets | $ 1,130 | $ 1,243 |
Non-current contract assets | 2,557 | 3,033 |
Contract liabilities | 1,668 | 1,743 |
Long-term contract liabilities | 3,905 | 4,315 |
Deferred income, current | $ 1,600 | $ 1,365 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |||||
Effective income tax rate | (2.30%) | (578.60%) | (5.00%) | (16.50%) | |
Liability for uncertain tax positions | $ 693 | $ 693 | $ 637 | ||
Decrease in unrecognized tax benefits is reasonably possible | $ 38 | $ 38 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2021 | |
Lessee, Lease, Description [Line Items] | |||||
Operating lease expense | $ 417 | $ 507 | $ 1,291 | $ 1,588 | |
Short-term lease costs | 15 | 41 | 55 | 139 | |
Net investment in lease, current | 3,739 | 3,739 | |||
Net investment in lease, noncurrent | 3,984 | 3,984 | |||
Sales-type lease, interest income | 159 | $ 191 | 501 | $ 591 | |
Lessor, operating lease, term of contract | 3 years | ||||
Lessor, operating lease, gross costs | 1,880 | 1,880 | |||
Lessor, operating lease, accumulated depreciation | 798 | $ 798 | |||
Lessor, operating lease, useful life | 5 years | ||||
Depreciation expense | 94 | $ 282 | |||
Lease revenue | $ 138 | $ 415 | |||
Operating Lease, Lease Income, Statement of Income or Comprehensive Income [Extensible Enumeration] | Total net sales | ||||
Minimum | |||||
Lessee, Lease, Description [Line Items] | |||||
Sales-type leases, term of contracts | 3 years | 3 years | |||
Maximum | |||||
Lessee, Lease, Description [Line Items] | |||||
Sales-type leases, term of contracts | 5 years | 5 years |
Leases - Future Minimum Operati
Leases - Future Minimum Operating Lease Payments (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Remainder of 2023 | $ 400 | |
2024 | 629 | |
2025 | 93 | |
2026 | 47 | |
2027 and thereafter | 79 | |
Total minimum lease payments | 1,248 | |
Less amount representing interest | (55) | |
Present value of net minimum operating lease payments | 1,193 | |
Less current installments of obligation under current-operating lease liabilities | 921 | $ 1,532 |
Obligations under long-term operating lease liabilities, excluding current installments | $ 272 | $ 636 |
Weighted-average remaining lease term - operating leases (years) | 1 year 6 months 10 days | |
Weighted-average discount rate - operating leases | 5.50% |
Leases - Sales-type Lease Futur
Leases - Sales-type Lease Future Undiscounted Cash Flows (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Leases [Abstract] | |
Remainder of 2023 | $ 1,547 |
2024 | 3,346 |
2025 | 2,016 |
2026 | 1,033 |
2027 | 514 |
2028 | 98 |
Total undiscounted cash flows | 8,554 |
Present value of lease payments | 7,723 |
Difference between undiscounted cash flows and discounted cash flows | $ 831 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments Receivable (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Leases [Abstract] | |
Remainder of 2023 | $ 138 |
2024 | 343 |
2025 | 25 |
Total | $ 506 |
Discontinued Operations - Sched
Discontinued Operations - Schedule of Net Income From Discontinued Operations (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Costs and expenses: | ||||
Net income from discontinued operations, net of tax | $ 0 | $ 29,741 | $ 0 | $ 28,061 |
Net income from discontinued operations per common share | ||||
Basic (in shares) | $ 0 | $ 1.59 | $ 0 | $ 1.51 |
Diluted (in shares) | $ 0 | $ 1.59 | $ 0 | $ 1.51 |
Weighted average number of common shares outstanding: | ||||
Basic (in shares) | 19,231 | 18,706 | 19,090 | 18,574 |
Diluted (in shares) | 19,231 | 18,706 | 19,090 | 18,574 |
Discontinued Operations, Disposed of by Sale | ||||
Sales: | ||||
Sales | $ 1,494 | $ 16,721 | ||
Costs and expenses: | ||||
Research and development | 374 | 3,147 | ||
Sales, marketing and support | 348 | 3,035 | ||
Other income, net | 12 | 81 | ||
Loss from discontinued operations before income tax expense | (889) | (2,569) | ||
Gain on sale of discontinued operations before tax expense | 30,858 | 30,858 | ||
Total income from discontinued operations before tax expense | 29,969 | 28,289 | ||
Income tax expense on discontinued operations | 228 | 228 | ||
Net income from discontinued operations, net of tax | $ 29,741 | $ 28,061 | ||
Net income from discontinued operations per common share | ||||
Basic (in shares) | $ 1.59 | $ 1.51 | ||
Diluted (in shares) | $ 1.59 | $ 1.51 | ||
Discontinued Operations, Disposed of by Sale | Product | ||||
Sales: | ||||
Sales | $ 1,276 | $ 16,042 | ||
Costs and expenses: | ||||
Cost of sales | 1,504 | 12,732 | ||
Discontinued Operations, Disposed of by Sale | Service | ||||
Sales: | ||||
Sales | 218 | 679 | ||
Costs and expenses: | ||||
Cost of sales | $ 169 | $ 457 |
Discontinued Operations - Sch_2
Discontinued Operations - Schedule of Cash Flows from Discontinued Operations (Details) - Discontinued Operations, Disposed of by Sale - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2022 | Sep. 30, 2022 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Cash used in operating activities - discontinued operations | $ (252) | $ (3,853) |
Cash used in investing activities - discontinued operations | $ (220) | $ (307) |
Discontinued Operations - Sch_3
Discontinued Operations - Schedule of Non-Cash Expenses from Discontinued Operations (Details) - Discontinued Operations, Disposed of by Sale - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2022 | Sep. 30, 2022 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Depreciation | $ 91 | $ 622 |
Compensation expense related to stock-based awards and employee stock purchase plan | $ 237 | $ 475 |