Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Apr. 30, 2015 | Jun. 02, 2015 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 30-Apr-15 | |
Document Fiscal Year Focus | 2016 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | SEAC | |
Entity Registrant Name | SEACHANGE INTERNATIONAL INC | |
Entity Central Index Key | 1019671 | |
Current Fiscal Year End Date | -30 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 33,308,575 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Apr. 30, 2015 | Jan. 31, 2015 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $72,971 | $90,019 |
Restricted cash | 1,073 | |
Marketable securities | 3,507 | 7,516 |
Accounts and other receivables, net of allowance for doubtful accounts of $451 and $400 at April 30, 2015 and January 31, 2015, respectively | 16,989 | 24,962 |
Unbilled receivables | 9,380 | 6,588 |
Inventories, net | 2,918 | 2,864 |
Prepaid expenses and other current assets | 4,152 | 3,026 |
Total current assets | 109,917 | 136,048 |
Property and equipment, net | 15,349 | 15,869 |
Marketable securities, long-term | 8,783 | 6,793 |
Investments in affiliates | 3,081 | 3,051 |
Intangible assets, net | 12,862 | 7,314 |
Goodwill | 58,134 | 41,008 |
Other assets | 1,621 | 2,268 |
Total assets | 209,747 | 212,351 |
Current liabilities: | ||
Accounts payable | 5,199 | 5,129 |
Deferred stock consideration | 6,739 | |
Other accrued expenses | 10,889 | 12,507 |
Deferred revenues | 15,804 | 17,398 |
Total current liabilities | 38,631 | 35,034 |
Deferred revenue, long-term | 1,538 | 1,690 |
Other liabilities, long-term | 1,855 | 1,493 |
Taxes payable, long-term | 1,975 | 1,993 |
Deferred tax liabilities, long-term | 1,073 | 1,090 |
Total liabilities | 45,072 | 41,300 |
Commitments and contingencies (Note 6) | ||
Stockholders' equity: | ||
Common stock, $0.01 par value; 100,000,000 shares authorized; 33,379,641 shares issued and 33,339,857 outstanding at April 30, 2015, and 32,733,636 shares issued and 32,693,852 outstanding at January 31, 2015 | 334 | 327 |
Additional paid-in capital | 223,382 | 219,651 |
Treasury stock, at cost; 39,784 common shares | -1 | -1 |
Accumulated loss | -52,997 | -43,172 |
Accumulated other comprehensive loss | -6,043 | -5,754 |
Total stockholders' equity | 164,675 | 171,051 |
Total liabilities and stockholders' equity | $209,747 | $212,351 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Apr. 30, 2015 | Jan. 31, 2015 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable | $451 | $400 |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 33,379,641 | 32,733,636 |
Common stock, shares outstanding | 33,339,857 | 32,693,852 |
Treasury stock, common shares | 39,784 | 39,784 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Loss (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Apr. 30, 2015 | Apr. 30, 2014 |
Revenues: | ||
Products | $3,164 | $5,058 |
Services | 20,013 | 19,279 |
Total revenues | 23,177 | 24,337 |
Cost of revenues: | ||
Products | 1,677 | 1,544 |
Services | 11,203 | 11,595 |
Amortization of intangible assets | 181 | 270 |
Stock-based compensation expense | 37 | |
Total cost of revenues | 13,061 | 13,446 |
Gross profit | 10,116 | 10,891 |
Operating expenses: | ||
Research and development | 9,533 | 10,928 |
Selling and marketing | 3,668 | 3,438 |
General and administrative | 3,887 | 4,016 |
Amortization of intangible assets | 941 | 1,509 |
Stock-based compensation expense | 711 | 559 |
Earn-outs and change in fair value of earn-outs | 502 | |
Professional fees - other | 128 | 102 |
Severance and other restructuring costs | 212 | 474 |
Total operating expenses | 19,582 | 21,026 |
Loss from operations | -9,466 | -10,135 |
Other (expense) income, net | -229 | 415 |
Loss before income taxes and equity income in earnings of affiliates | -9,695 | -9,720 |
Income tax provision (benefit) | 147 | -234 |
Equity income in earnings of affiliates, net of tax | 17 | 19 |
Net loss | -9,825 | -9,467 |
Net loss | -9,825 | -9,467 |
Other comprehensive (loss) income, net of tax: | ||
Foreign currency translation adjustment | -277 | 520 |
Unrealized (loss) gain on marketable securities | -12 | 5 |
Comprehensive loss | ($10,114) | ($8,942) |
Net loss per share: | ||
Basic | ($0.29) | ($0.29) |
Diluted | ($0.29) | ($0.29) |
Weighted average common shares outstanding: | ||
Basic | 33,328 | 32,985 |
Diluted | 33,328 | 32,985 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 30, 2015 | Apr. 30, 2014 |
Cash flows from operating activities: | ||
Net loss | ($9,825) | ($9,467) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization of property and equipment | 870 | 995 |
Amortization of intangible assets | 1,122 | 1,779 |
Fair value of acquisition related contingent consideration | 502 | |
Stock-based compensation expense | 711 | 596 |
Other | 89 | 11 |
Changes in operating assets and liabilities, excluding impact of acquisition: | ||
Accounts receivable | 7,822 | 4,855 |
Unbilled receivables | -2,864 | 40 |
Inventories | -148 | 244 |
Prepaid expenses and other assets | -1,091 | -1,793 |
Accounts payable | 119 | 771 |
Accrued expenses | -2,118 | -3,731 |
Deferred revenues | -1,467 | 277 |
Other | -465 | 141 |
Total cash used in operating activities | -6,743 | -5,282 |
Cash flows from investing activities: | ||
Purchases of property and equipment | -282 | -371 |
Capitalized internal use software | -749 | |
Purchases of marketable securities | -2,033 | -1,543 |
Proceeds from sale and maturity of marketable securities | 4,034 | 538 |
Investment in affiliate | -2,000 | |
Cash paid for acquisition of business, net of cash acquired | -11,686 | |
Total cash used in investing activities | -10,716 | -3,376 |
Cash flows from financing activities: | ||
Repurchases of common stock | -3,504 | |
Total cash used in financing activities | -3,504 | |
Effect of exchange rate changes on cash | 411 | -315 |
Net decrease in cash and cash equivalents | -17,048 | -12,477 |
Cash and cash equivalents, beginning of period | 90,019 | 115,734 |
Cash and cash equivalents, end of period | 72,971 | 103,257 |
Supplemental disclosure of cash flow information: | ||
Income taxes paid | 183 | 248 |
Interest paid | 2 | |
Supplemental disclosure of non-cash investing activities: | ||
Transfer of items originally classified as inventories to equipment | $80 | $123 |
Nature_of_Business_and_Basis_o
Nature of Business and Basis of Presentation | 3 Months Ended | |
Apr. 30, 2015 | ||
Accounting Policies [Abstract] | ||
Nature of Business and Basis of Presentation | 1 | Nature of Business and Basis of Presentation |
The Company | ||
SeaChange International, Inc. and its consolidated subsidiaries (collectively “SeaChange”, “we”, or the “Company”) is an industry leader in the delivery of multiscreen video. Our products and services facilitate the aggregation, licensing, management and distribution of video and television advertising content to cable television system operators, telecommunications and media companies. | ||
Basis of Presentation | ||
The accompanying unaudited consolidated financial statements include the accounts of SeaChange International, Inc. and its subsidiaries (“SeaChange” or the “Company”) and are prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial reports as well as rules and regulations of the Securities and Exchange Commission (“SEC”). All intercompany transactions and balances have been eliminated. Certain information and footnote disclosures normally included in financial statements prepared under U.S. GAAP have been condensed or omitted pursuant to such regulations. However, we believe that the disclosures are adequate to make the information presented not misleading. In the opinion of management, the accompanying financial statements include all adjustments necessary to present a fair presentation of the consolidated financial statements for the periods shown. These consolidated financial statements should be read in conjunction with our most recently audited financial statements and related footnotes included in our Annual Report on Form 10-K (“Form 10-K”) as filed with the SEC. The balance sheet data as of January 31, 2015 that is included in this Quarterly Report on Form 10-Q (“Form 10-Q”) was derived from our audited financial statements. | ||
The preparation of these financial statements in conformity with U.S. GAAP, requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities. Interim results are not necessarily indicative of the operating results for the full fiscal year or any future periods and actual results may differ from our estimates. During the three months ended April 30, 2015, there have been no material changes to our significant accounting policies that were described in our fiscal 2015 Form 10-K, as filed with the SEC. |
Fair_Value_Measurements
Fair Value Measurements | 3 Months Ended | ||||||||||||||||
Apr. 30, 2015 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Fair Value Measurements | 2 | Fair Value Measurements | |||||||||||||||
Definition and Hierarchy | |||||||||||||||||
The applicable accounting guidance defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The guidance establishes a framework for measuring fair value and expands required disclosure about the fair value measurements of assets and liabilities. This guidance requires us to classify and disclose assets and liabilities measured at fair value on a recurring basis, as well as fair value measurements of assets and liabilities measured on a non-recurring basis in periods subsequent to initial measurement, in a fair value hierarchy. | |||||||||||||||||
The fair value hierarchy is broken down into three levels based on the reliability of inputs and requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required, as well as the assets and liabilities that we value using those levels of inputs: | |||||||||||||||||
• | Level 1 – Observable inputs that reflect quoted prices for identical assets or liabilities in active markets. | ||||||||||||||||
• | Level 2 – Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not very active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||||||||||||||||
• | Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The fair value of the contingent consideration obligations related to our business acquisitions are valued using Level 3 inputs. | ||||||||||||||||
Valuation Techniques | |||||||||||||||||
Inputs to valuation techniques are observable and unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. When developing fair value estimates for certain financial assets and liabilities, we maximize the use of observable inputs and minimize the use of unobservable inputs. When available, we use quoted market prices, market comparables and discounted cash flow projections. Financial assets include money market funds, U.S. treasury notes or bonds and U.S. government agency bonds. | |||||||||||||||||
In general, and where applicable, we use quoted prices in active markets for identical assets or liabilities to determine fair value. If quoted prices in active markets for identical assets or liabilities are not available to determine fair value, then we use quoted prices for similar assets and liabilities or inputs that are observable either directly or indirectly. In periods of market inactivity, the observability of prices and inputs may be reduced for certain instruments. This condition could cause an instrument to be reclassified from Level 1 to Level 2 or from Level 2 to Level 3. | |||||||||||||||||
Fair Value Measurements of Assets and Liabilities | |||||||||||||||||
The following tables set forth our financial assets and liabilities that were accounted for at fair value on a recurring basis as of April 30, 2015 and January 31, 2015: | |||||||||||||||||
Fair Value at April 30, 2015 Using | |||||||||||||||||
April 30, | Quoted | Significant | Significant | ||||||||||||||
2015 | Prices in | Other | Unobservable | ||||||||||||||
Active | Observable | Inputs | |||||||||||||||
Markets for | Inputs | (Level 3) | |||||||||||||||
Identical Assets | (Level 2) | ||||||||||||||||
(Level 1) | |||||||||||||||||
(Amounts in thousands) | |||||||||||||||||
Financial assets: | |||||||||||||||||
Money market accounts (a) | $ | 3,615 | $ | 3,615 | $ | — | $ | — | |||||||||
Available for sale marketable securities: | |||||||||||||||||
Current marketable securities: | |||||||||||||||||
U.S. treasury notes and bonds - conventional | 1,500 | 1,500 | — | — | |||||||||||||
U.S. government agency issues | 2,007 | — | 2,007 | — | |||||||||||||
Non-current marketable securities: | |||||||||||||||||
U.S. treasury notes and bonds - conventional | 6,279 | 6,279 | — | — | |||||||||||||
U.S. government agency issues | 2,504 | — | 2,504 | — | |||||||||||||
Total | $ | 15,905 | $ | 11,394 | $ | 4,511 | $ | — | |||||||||
Financial liabilities: | |||||||||||||||||
Contingent consideration (b) | $ | 1,017 | $ | — | $ | — | $ | 1,017 | |||||||||
Fair Value at January 31, 2015 Using | |||||||||||||||||
January 31, | Quoted | Significant | Significant | ||||||||||||||
2015 | Prices in | Other | Unobservable | ||||||||||||||
Active | Observable | Inputs | |||||||||||||||
Markets for | Inputs | (Level 3) | |||||||||||||||
Identical Assets | (Level 2) | ||||||||||||||||
(Level 1) | |||||||||||||||||
(Amounts in thousands) | |||||||||||||||||
Financial assets: | |||||||||||||||||
Money market accounts (a) | $ | 1,575 | $ | 1,575 | $ | — | $ | — | |||||||||
Available for sale marketable securities: | |||||||||||||||||
Current marketable securities: | |||||||||||||||||
U.S. treasury notes and bonds - conventional | 1,501 | 1,501 | — | — | |||||||||||||
U.S. government agency issues | 6,015 | — | 6,015 | — | |||||||||||||
Non-current marketable securities: | |||||||||||||||||
U.S. treasury notes and bonds - conventional | 4,286 | 4,286 | |||||||||||||||
U.S. government agency issues | 2,507 | — | 2,507 | — | |||||||||||||
Total | $ | 15,884 | $ | 7,362 | $ | 8,522 | $ | — | |||||||||
(a) | Money market funds and U.S. treasury bills are included in cash and cash equivalents on the accompanying consolidated balance sheet and are valued at quoted market prices for identical instruments in active markets. | ||||||||||||||||
(b) | The fair value of our contingent consideration arrangement is determined based on management’s evaluation as to the probability of achieving certain defined performance criteria based on the expected future performance of the acquired entity, as well as the fair value of the estimated shares of the Company’s common stock to be issued. There was no change to this Level 3 liability in the three months ended April 30, 2015. | ||||||||||||||||
Available-For-Sale Securities | |||||||||||||||||
We determine the appropriate classification of debt investment securities at the time of purchase and reevaluate such designation as of each balance sheet date. Our investment portfolio consists of money market funds, U.S. treasury notes and bonds, and U.S. government agency notes and bonds as of April 30, 2015 and January 31, 2015. All highly liquid investments with an original maturity of three months or less when purchased are considered to be cash equivalents. All cash equivalents are carried at cost, which approximates fair value. Our marketable securities are classified as available-for-sale and are reported at fair value with unrealized gains and losses, net of tax, reported in stockholders’ equity as a component of accumulated other comprehensive loss. The amortization of premiums and accretion of discounts to maturity are computed under the effective interest method and are included in other expenses, net, in our consolidated statements of operations and comprehensive loss. Interest on securities is recorded as earned and is also included in other expenses, net. Any realized gains or losses would be shown in the accompanying consolidated statements of operations and comprehensive loss in other expenses, net. We provide fair value measurement disclosures of available-for-sale securities in accordance with one of three levels of fair value measurement mentioned above. | |||||||||||||||||
The following is a summary of cash, cash equivalents and available-for-sale securities, including the cost basis, aggregate fair value and gross unrealized gains and losses, for short- and long-term marketable securities portfolio as of April 30, 2015 and January 31, 2015: | |||||||||||||||||
Amortized | Gross | Gross | Estimated | ||||||||||||||
Cost | Unrealized | Unrealized | Fair Value | ||||||||||||||
Gains | Losses | ||||||||||||||||
(Amounts in thousands) | |||||||||||||||||
April 30, 2015: | |||||||||||||||||
Cash | $ | 69,356 | $ | — | $ | — | $ | 69,356 | |||||||||
Cash equivalents | 3,615 | — | — | 3,615 | |||||||||||||
Cash and cash equivalents | 72,971 | — | — | 72,971 | |||||||||||||
U.S. treasury notes and bonds - short-term | 1,499 | 1 | 1,500 | ||||||||||||||
U.S. treasury notes and bonds - long-term | 6,267 | 12 | — | 6,279 | |||||||||||||
U.S. government agency issues - short-term | 2,003 | 4 | — | 2,007 | |||||||||||||
U.S. government agency issues - long-term | 2,490 | 14 | 2,504 | ||||||||||||||
Total cash, cash equivalents and marketable securities | $ | 85,230 | $ | 31 | $ | — | $ | 85,261 | |||||||||
January 31, 2015: | |||||||||||||||||
Cash | $ | 88,444 | $ | — | $ | — | $ | 88,444 | |||||||||
Cash equivalents | 1,575 | — | — | 1,575 | |||||||||||||
Cash and cash equivalents | 90,019 | — | — | 90,019 | |||||||||||||
U.S. treasury notes and bonds - short-term | 1,500 | 1 | 1,501 | ||||||||||||||
U.S. treasury notes and bonds - long-term | 4,268 | 18 | — | 4,286 | |||||||||||||
U.S. government agency issues - short-term | 6,008 | 7 | — | 6,015 | |||||||||||||
U.S. government agency issues - long-term | 2,490 | 17 | 2,507 | ||||||||||||||
Total cash, cash equivalents and marketable securities | $ | 104,285 | $ | 43 | $ | — | $ | 104,328 | |||||||||
The following is a schedule of the contractual maturities of available-for-sale investments as of April 30, 2015 (amounts in thousands): | |||||||||||||||||
Estimated | |||||||||||||||||
Fair Value | |||||||||||||||||
Maturity of one year or less | $ | 3,507 | |||||||||||||||
Maturity between one and five years | 8,783 | ||||||||||||||||
Total | $ | 12,290 | |||||||||||||||
Cash, Cash Equivalents and Marketable Securities | |||||||||||||||||
Cash and cash equivalents consist primarily of highly liquid investments in money market mutual funds, government sponsored enterprise obligations, treasury bills, commercial paper and other money market securities with remaining maturities at date of purchase of 90 days or less. | |||||||||||||||||
Restricted Cash | |||||||||||||||||
In December 2014, in conjunction with our acquisition of TLL, LLC (“Timeline Labs”) (see Note 3 below), we entered into an agreement to fund a $2.5 million escrow from which Timeline Labs could make withdrawals for working capital purposes in advance of the February 2, 2015 acquisition date. The unused portion as of January 31, 2015, being $1.1 million, was classified as restricted cash in our consolidated balance sheet as of January 31, 2015. On February 2, 2015 this amount was retained by the Company. | |||||||||||||||||
The fair value of cash, cash equivalents, restricted cash and marketable securities at April 30, 2015 and January 31, 2015 was $85.3 million and $105.4 million, respectively. | |||||||||||||||||
Contingent Consideration | |||||||||||||||||
We determined the fair value of the contingent consideration in connection with the acquisition of Timeline Labs on February 2, 2015 using a method that incorporates the Black-Scholes valuation model to establish the value of the shares of our common stock in addition to an evaluation of the probability of achievement. This fair value measurement is based on significant inputs not observed in the market and thus represents a Level 3 measurement. Any change in the fair value of the contingent consideration subsequent to the acquisition date, such as changes in our estimates of the performance goals, will be recognized in earnings in the period the estimated fair value changes. For contingent consideration arrangements which contain an employment requirement and as a result is considered compensation expense, we will recognize a liability once the requisite service period has been completed. |
Acquisition_of_TLL_LLC
Acquisition of TLL, LLC | 3 Months Ended | ||||||||
Apr. 30, 2015 | |||||||||
Business Combinations [Abstract] | |||||||||
Acquisition of TLL, LLC | 3 | Acquisition of TLL, LLC | |||||||
On February 2, 2015, pursuant to an Agreement and Plan of Merger (the “Merger Agreement”), dated as of December 22, 2014, we acquired 100% of the member interests in TLL, LLC (“Timeline Labs”), a privately-owned California-based software-as-a-service (“SaaS”) company that enables local broadcasters, national news organizations and other media companies and brands to analyze social media messages in real-time, find and broadcast social trends, and measure viewing audience engagement across television, mobile and personal computers. | |||||||||
We accounted for the acquisition of Timeline Labs as a business combination and the financial results of Timeline Labs have been included in our consolidated financial statements as of the date of acquisition. Under the acquisition method of accounting, the purchase price was allocated to SeaChange’s net tangible and intangible assets based upon their fair values as of February 2, 2015. | |||||||||
The preliminary allocation of the purchase price is as follows (amounts in thousands, except for share data): | |||||||||
Fair value of consideration: | |||||||||
Cash, net of cash acquired | $ | 14,186 | |||||||
Closing stock consideration | 3,025 | ||||||||
Deferred stock consideration | 6,739 | ||||||||
Contingent consideration | 514 | ||||||||
Total purchase price | $ | 24,464 | |||||||
Fair value of assets acquired and liabilities assumed: | |||||||||
Current assets | 249 | ||||||||
Other long-term assets | 108 | ||||||||
Finite-life intangible assets | 6,720 | ||||||||
Goodwill | 17,453 | ||||||||
Current liabilities | (66 | ) | |||||||
Allocated purchase price | $ | 24,464 | |||||||
Fair Value of Consideration Transferred | |||||||||
Upon completion of the acquisition, the Company made cash consideration payments to the former members of Timeline Labs in the amount of $14.2 million (“Closing Cash Consideration”), which includes $0.2 million of preliminary working capital adjustments. The Closing Cash Consideration included $1.4 million applied from an escrow that was funded by the Company in the fourth quarter of fiscal 2015. Additionally, the Company issued 344,055 shares of common stock to the former members of Timeline Labs and deposited 173,265 shares of common stock into escrow as of the acquisition date. | |||||||||
The Company is also obligated to issue shares of common stock at the six month and twelve month anniversaries of the acquisition date. The aggregate acquisition date fair value of the estimated shares for both anniversary date issuances is $6.7 million and is classified in the consolidated balance sheet as a current liability. | |||||||||
Contingent Consideration | |||||||||
A former holder of a specified series of interest of Timeline Labs is eligible to receive additional earn-out consideration, consisting of shares of our common stock, if defined performance criteria are achieved for fiscal 2016 and 2017 without a requirement to remain as an employee of the Company. As of April 30, 2015, we have included a liability of $0.5 million in our consolidated balance sheet, which represents the fair value of the estimated shares at full achievement of the defined performance criteria. Any future changes to this liability resulting from changes in probability of achievement or changes to the fair value will be included in our consolidated statements of operations and comprehensive loss in the period which the change occurs. | |||||||||
Additionally, the former holders of a specified series of interests of Timeline Labs are eligible to receive additional earn-out compensation, consisting of shares of our common stock, if defined performance criteria are achieved for fiscal 2016 and 2017, provided, that if such person was an employee of Timeline Labs as of the closing date, such person must remain an employee as of the date that all earn-out consideration would be paid, with any forfeited amounts to be reallocated to other eligible persons. As of April 30, 2015, we estimated the fair value of the aggregate liability of the employee portion of contingent consideration to be $2.7 million which we will be recognizing as the requisite service period is completed. For the three months ended April 30, 2015, we recorded a $0.5 million charge associated with this arrangement that has been included in the earn-outs and change in fair value of earn-outs in our consolidated statements of operations and comprehensive loss. | |||||||||
Intangible Assets | |||||||||
In determining the fair value of the intangible assets, the Company considered, among other factors, the intended use of the assets, the estimates of future performance of Timeline Lab’s products and analyses of historical financial performance. The fair values of identified intangible assets were calculated using income-based approaches based on estimates and assumptions provided by Timeline Labs’ and the Company’s management. The following table sets forth the components of the identified intangible assets associated with the Timeline Labs acquisition and their estimated useful lives: | |||||||||
Useful life | Fair Value | ||||||||
(Amounts in thousands) | |||||||||
Tradename | 7 years | $ | 620 | ||||||
Customer contracts | 7 years | 4,760 | |||||||
Non-compete agreements | 2 years | 170 | |||||||
Existing technology | 5 years | 1,170 | |||||||
$ | 6,720 | ||||||||
Acquired Goodwill | |||||||||
The preliminary purchase price allocation is subject to our final determination of fair value. We recorded the $17.5 million excess of the purchase price over the fair value of the identified tangible and intangible assets as goodwill, primarily due to expected synergies between the combined companies and expanded market opportunities. The goodwill is deductible for tax purposes. | |||||||||
Acquisition-related Costs | |||||||||
In connection with the acquisition, we incurred approximately $0.1 million in acquisition-related costs, including legal, accounting and other professional services for the three months ended April 30, 2015. The acquisition costs were expensed as incurred and included in professional fees – other, in our consolidated statements of operations and comprehensive loss. |
Inventories
Inventories | 3 Months Ended | ||||||||
Apr. 30, 2015 | |||||||||
Inventory Disclosure [Abstract] | |||||||||
Inventories | 4 | Inventories | |||||||
Inventories consist primarily of hardware and related component parts and are stated at the lower of cost (on a first-in, first-out basis) or market. Inventories consist of the following: | |||||||||
April 30, | January 31, | ||||||||
2015 | 2015 | ||||||||
(Amounts in thousands) | |||||||||
Components and assemblies | $ | 1,296 | $ | 1,487 | |||||
Finished products | 1,622 | 1,377 | |||||||
Total inventory | $ | 2,918 | $ | 2,864 | |||||
Goodwill_and_Intangible_Assets
Goodwill and Intangible Assets | 3 Months Ended | ||||||||||||||||||||||||||
Apr. 30, 2015 | |||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||
Goodwill and Intangible Assets | 5 | Goodwill and Intangible Assets | |||||||||||||||||||||||||
Goodwill | |||||||||||||||||||||||||||
Changes in the carrying amount of goodwill for the three months ended April 30, 2015 were as follows: | |||||||||||||||||||||||||||
Goodwill | |||||||||||||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||||||||
Balance at January 31, 2015 | $ | 41,008 | |||||||||||||||||||||||||
Acquisition of Timeline Labs | 17,453 | ||||||||||||||||||||||||||
Cumulative translation adjustment | (327 | ) | |||||||||||||||||||||||||
Balance at April 30, 2015 | $ | 58,134 | |||||||||||||||||||||||||
We are required to perform impairment tests related to our goodwill annually, which we perform during the third quarter of each fiscal year or sooner if an indicator of impairment occurs. There was no impairment of goodwill determined as a result of the annual impairment test analysis completed during the third quarter of fiscal 2015. While no impairment charges resulted from our annual test, impairment charges may occur in the future as a result of changes in projected growth and other factors. | |||||||||||||||||||||||||||
Intangible Assets | |||||||||||||||||||||||||||
Intangible assets, net, consisted of the following at April 30, 2015 and January 31, 2015: | |||||||||||||||||||||||||||
As of April 30, 2015 | As of January 31, 2015 | ||||||||||||||||||||||||||
Weighted | Gross | Accumulated | Net | Gross | Accumulated | Net | |||||||||||||||||||||
average | Amortization | Amortization | |||||||||||||||||||||||||
remaining | |||||||||||||||||||||||||||
life | |||||||||||||||||||||||||||
(Years) | |||||||||||||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||||||||
Finite-life intangible assets: | |||||||||||||||||||||||||||
Customer contracts | 6.3 | $ | 34,984 | $ | (24,896 | ) | $ | 10,088 | $ | 30,397 | $ | (24,160 | ) | $ | 6,237 | ||||||||||||
Non-compete agreements | 2 | 2,576 | (2,427 | ) | 149 | 2,433 | (2,433 | ) | — | ||||||||||||||||||
Completed technology | 5.1 | 11,386 | (9,359 | ) | 2,027 | 10,307 | (9,230 | ) | 1,077 | ||||||||||||||||||
Trademarks, patents and other | 7 | 7,697 | (7,099 | ) | 598 | 7,082 | (7,082 | ) | — | ||||||||||||||||||
Total finite-life intangible assets | $ | 56,643 | $ | (43,781 | ) | $ | 12,862 | $ | 50,219 | $ | (42,905 | ) | $ | 7,314 | |||||||||||||
As of April 30, 2015, the estimated future amortization expense for our finite-life intangible assets for the remainder of fiscal 2016, the four succeeding fiscal years and thereafter is as follows (amounts in thousands): | |||||||||||||||||||||||||||
Fiscal Year Ended January 31, | Estimated | ||||||||||||||||||||||||||
Amortization | |||||||||||||||||||||||||||
Expense | |||||||||||||||||||||||||||
2016 (for the remaining nine months) | $ | 3,423 | |||||||||||||||||||||||||
2017 | 3,244 | ||||||||||||||||||||||||||
2018 | 2,197 | ||||||||||||||||||||||||||
2019 | 1,648 | ||||||||||||||||||||||||||
2020 | 1,199 | ||||||||||||||||||||||||||
2021 and thereafter | 1,151 | ||||||||||||||||||||||||||
Total | $ | 12,862 | |||||||||||||||||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | |
Apr. 30, 2015 | ||
Commitments and Contingencies Disclosure [Abstract] | ||
Commitments and Contingencies | 6 | Commitments and Contingencies |
Indemnification and Warranties | ||
We provide indemnification, to the extent permitted by law, to our officers, directors, employees and agents for liabilities arising from certain events or occurrences while the officer, director, employee or agent is, or was, serving at our request in such capacity. With respect to acquisitions, we provide indemnification to, or assume indemnification obligations for, the current and former directors, officers and employees of the acquired companies in accordance with the acquired companies’ governing documents. As a matter of practice, we have maintained directors’ and officers’ liability insurance including coverage for directors and officers of acquired companies. | ||
We enter into agreements in the ordinary course of business with customers, resellers, distributors, integrators and suppliers. Most of these agreements require us to defend and/or indemnify the other party against intellectual property infringement claims brought by a third party with respect to our products. From time to time, we also indemnify customers and business partners for damages, losses and liabilities they may suffer or incur relating to personal injury, personal property damage, product liability, and environmental claims relating to the use of our products and services or resulting from the acts or omissions of us, our employees, authorized agents or subcontractors. From time to time we have received requests from customers for indemnification of patent litigation claims. Management cannot reasonably estimate any potential losses, but these claims could result in material liability for us. There are no current pending legal proceedings, in the opinion of management that would have a material adverse effect on our financial position, results from operations and cash flows. There is no assurance that future legal proceedings arising from ordinary course of business or otherwise, will have a material adverse effect on our financial position, results from operations or cash flows. | ||
We warrant that our products, including software products, will substantially perform in accordance with our standard published specifications in effect at the time of delivery. In addition, we provide maintenance support to our customers and therefore allocate a portion of the product purchase price to the initial warranty period and recognize revenue on a straight line basis over that warranty period related to both the warranty obligation and the maintenance support agreement. When we receive revenue for extended warranties beyond the standard duration, it is deferred and recognized on a straight line basis over the contract period. Related costs are expensed as incurred. | ||
Revolving Line of Credit/Demand Note Payable | ||
We maintain a demand discretionary line of credit and a Demand Promissory Note in the aggregate amount of $20.0 million. Borrowings under the line of credit will be used to finance working capital needs and for general corporate purposes. We currently do not have any borrowings and as a result, are not subject to any financial covenants under this line. |
Severance_and_Other_Restructur
Severance and Other Restructuring Costs | 3 Months Ended | ||||
Apr. 30, 2015 | |||||
Restructuring and Related Activities [Abstract] | |||||
Severance and Other Restructuring Costs | 7 | Severance and Other Restructuring Costs | |||
During the three months ended April 30, 2015, we incurred restructuring charges of $0.2 million primarily from severance costs for terminated employees as a result of our restructuring plan initiated in January 2015. | |||||
The following table shows the change in balances of our accrued severance reported as a component of other accrued expenses on the consolidated balance sheet as of April 30, 2015 (amounts in thousands): | |||||
Three Months Ended | |||||
April 30, 2015 | |||||
Accrual balance at the beginning of the period | $ | 2,021 | |||
Restructuring charges incurred | 212 | ||||
Severance costs paid | (2,037 | ) | |||
Other charges | (65 | ) | |||
Accrual balance as of April 30, 2015 | $ | 131 | |||
Stock_Repurchase_Program
Stock Repurchase Program | 3 Months Ended | |
Apr. 30, 2015 | ||
Equity [Abstract] | ||
Stock Repurchase Program | 8 | Stock Repurchase Program |
On September 4, 2013, our Board of Directors authorized the repurchase of up to $25.0 million of our common stock through a share repurchase program, which we increased to $40.0 million on May 31, 2014 in connection with an extension of the termination date to April 30, 2015. Under the program, we were authorized to repurchase shares through Rule 10b5-1 plans, open market purchases, privately negotiated transactions, block purchases or otherwise in accordance with applicable federal securities laws, including Rule 10b-18 of the Securities Exchange Act of 1934. This share repurchase program did not obligate us to acquire any specific number of shares and could be suspended or discontinued at any time. All repurchases were expected to be funded from our current cash and investment balances. The timing and amount of shares to be repurchased was based on market conditions and other factors, including price, corporate and regulatory requirements, and alternative investment opportunities. Any shares repurchased by us under the share repurchase program reduced the number of shares outstanding. Pursuant to the share repurchase program, we executed a Rule 10b5-1 plan in June 2014 to repurchase shares. We did not repurchase any shares of our common stock during the three months ended April 30, 2015 and the repurchase authorization expired by its terms on April 30, 2015. Through April 30, 2015, we used $5.5 million of cash in connection with the repurchase 591,520 shares of our common stock (an average price of $9.31 per share) under this program. |
Stock_Incentive_Plans
Stock Incentive Plans | 3 Months Ended | |
Apr. 30, 2015 | ||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Stock Incentive Plans | 9 | Stock Incentive Plans |
2011 Compensation and Incentive Plan | ||
In July 2011, our stockholders approved the adoption of our 2011 Compensation and Incentive Plan (the “2011 Plan”). Under the 2011 Plan, as amended in July 2013, the number of authorized shares of common stock is equal to 5,300,000 shares plus the number of shares that expired, terminated, surrendered or forfeited awards subsequent to July 20, 2011 under the Amended and Restated 2005 Equity Compensation and Incentive Plan (the “2005 Plan”). Following approval of the 2011 Plan, we terminated the 2005 Plan. The 2011 Plan provides for the grant of incentive stock options, nonqualified stock options, restricted stock, restricted stock units (“RSUs”), deferred stock units (“DSUs”) and other equity based non-stock option awards as determined by the plan administrator by officers, employees, consultants, and directors of the Company. | ||
Effective February 1, 2014, SeaChange gave its non-employee members of the Board of Directors the option to receive DSUs in lieu of RSUs beginning with the annual grant for fiscal 2015. These DSUs shall fully vest one year from the grant date. The number of units subject to the DSUs is determined as of the first day of the applicable fiscal year and the shares underlying the DSUs are not vested and issued until the earlier of the director ceasing to be a member of the Board of Directors (provided such time is subsequent to the first day of the succeeding fiscal year) or immediately prior to a change in control. | ||
We may satisfy awards upon the exercise of stock options or vesting of RSUs with newly issued shares or treasury shares. The Board of Directors is responsible for the administration of the 2011 Plan and determining the terms of each award, award exercise price, the number of shares for which each award is granted and the rate at which each award vests. In certain instances the Board of Directors may elect to modify the terms of an award. | ||
Option awards may be granted to employees at an exercise price per share of not less than 100% of the fair market value per common share on the date of the grant. RSUs, DSUs and other equity-based non-stock option awards may be granted to any officer, employee, director, or consultant at a purchase price per share as determined by the Board of Directors. Option awards granted under the 2011 Plan generally vest over a period of three years and expire ten years from the date of the grant. | ||
We appointed a new CEO on October 20, 2014, at which time he was granted 500,000 stock options to purchase the Company’s common stock. These stock options have an exercise price equal to our closing stock price on October 20, 2014, and will vest in approximately equal increments based upon the closing price of SeaChange’s common stock. We recorded the fair value of these stock options using the Monte Carlo simulation model, since the stock option vesting is variable depending on the closing price of our traded common stock. The model simulated the daily trading price of the market-based stock options’ expected term to determine if the vesting conditions would be triggered during the term. As a result, the fair value of these stock options was estimated at $1.7 million. We have incurred stock compensation expense related to these stock options of $0.5 million since the date of grant. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Loss | 3 Months Ended | ||||||||||||
Apr. 30, 2015 | |||||||||||||
Equity [Abstract] | |||||||||||||
Accumulated Other Comprehensive Loss | 10 | Accumulated Other Comprehensive Loss | |||||||||||
The following shows the changes in the components of accumulated other comprehensive loss for the three months ended April 30, 2015: | |||||||||||||
Foreign | Changes in | Total | |||||||||||
Currency | Fair Value of | ||||||||||||
Translation | Available | ||||||||||||
Adjustment | for Sale | ||||||||||||
Investments | |||||||||||||
(Amounts in thousands) | |||||||||||||
Balance at January 31, 2015 | $ | (5,797 | ) | $ | 43 | $ | (5,754 | ) | |||||
Other comprehensive loss | (277 | ) | (12 | ) | (289 | ) | |||||||
Balance at April 30, 2015 | $ | (6,074 | ) | $ | 31 | $ | (6,043 | ) | |||||
Comprehensive loss consists of net loss and other comprehensive loss, which includes foreign currency translation adjustments and changes in unrealized gains and losses on marketable securities available for sale. For purposes of comprehensive loss disclosures, we do not record tax expense or benefits for the net changes in the foreign currency translation adjustments, as we intend to permanently reinvest all undistributed earnings of our foreign subsidiaries. |
Segment_Information_Significan
Segment Information, Significant Customers and Geographic Information | 3 Months Ended | ||||||||||||||||
Apr. 30, 2015 | |||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||
Segment Information, Significant Customers and Geographic Information | 11 | Segment Information, Significant Customers and Geographic Information | |||||||||||||||
Segment Information | |||||||||||||||||
Our operations are organized into one reportable segment. Operating segments are defined as components of an enterprise evaluated regularly by the Company’s chief operating decision maker in deciding how to allocate resources and assess performance. Our reportable segment was determined based upon the nature of the products offered to customers, the market characteristics of each operating segment and the Company’s management structure. | |||||||||||||||||
Significant Customers | |||||||||||||||||
The following summarizes revenues by significant customer where such revenue exceeded 10% of total revenues for the indicated period: | |||||||||||||||||
Three Months Ended | |||||||||||||||||
April 30, | |||||||||||||||||
2015 | 2014 | ||||||||||||||||
Customer A | 19 | % | 18 | % | |||||||||||||
Customer B | 17 | % | 20 | % | |||||||||||||
Geographic Information | |||||||||||||||||
The following table summarizes revenues by customers’ geographic locations for the periods presented: | |||||||||||||||||
Three Months Ended April 30, | |||||||||||||||||
2015 | 2014 | ||||||||||||||||
Amount | % | Amount | % | ||||||||||||||
(Amounts in thousands, except percentages) | |||||||||||||||||
Revenues by customers’ geographic locations: | |||||||||||||||||
North America(1) | $ | 13,779 | 59 | % | $ | 14,642 | 60 | % | |||||||||
Europe and Middle East | 7,566 | 33 | % | 7,697 | 32 | % | |||||||||||
Latin America | 1,098 | 5 | % | 1,649 | 7 | % | |||||||||||
Asia Pacific and other international locations | 734 | 3 | % | 349 | 1 | % | |||||||||||
Total | $ | 23,177 | $ | 24,337 | |||||||||||||
-1 | Includes total revenues for the United States for the periods shown as follows (amounts in thousands, except percentage data): | ||||||||||||||||
Three Months Ended | |||||||||||||||||
April 30, | |||||||||||||||||
2015 | 2014 | ||||||||||||||||
U.S. Revenue | $ | 11,935 | $ | 13,468 | |||||||||||||
% of total revenues | 51.5 | % | 55.3 | % |
Income_Taxes
Income Taxes | 3 Months Ended | |
Apr. 30, 2015 | ||
Income Tax Disclosure [Abstract] | ||
Income Taxes | 12 | Income Taxes |
We recorded an income tax provision from continuing operations of $0.1 million for the three months ended April 30, 2015 primarily due to the tax deductible goodwill acquired from Timeline Labs. The taxable temporary differences related to tax amortization of the acquired goodwill creates a deferred tax liability associated with an indefinite-lived intangible asset. Accordingly, the resulting deferred tax liability cannot be used as a source of income against which our deferred tax assets may be realized. | ||
The Company reviews all available evidence to evaluate the recovery of deferred tax assets, including the recent history of losses in all tax jurisdictions, as well as its ability to generate income in future periods. As of April 30, 2015, due to the uncertainty related to the ultimate use of certain deferred income tax assets, the Company has recorded a valuation allowance on certain of its deferred tax assets. | ||
Our effective tax rate in fiscal 2016 and in future periods may fluctuate on a quarterly basis as a result of changes in our jurisdictional forecasts where losses cannot be benefitted due to the existence of valuation allowances on our deferred tax assets, changes in actual results versus our estimates, or changes in tax laws, regulations, accounting principles, or interpretations thereof. We regularly review our tax positions in each significant taxing jurisdiction in the process of evaluating our unrecognized tax benefits. We make adjustments to our unrecognized tax benefits when: i) facts and circumstance regarding a tax position change, causing a change in management’s judgment regarding that tax position; ii) a tax position is effectively settled with a tax authority; and/or iii) the statute of limitations expires regarding a tax position. | ||
We file income tax returns in U.S. federal jurisdiction, various state jurisdictions, and various foreign jurisdictions. We are no longer subject to U.S. federal examinations before fiscal 2010. However, the taxing authorities still have the ability to review the propriety of certain tax attributes created in closed years if such tax attributes are utilized in an open tax year. Presently, we are under audit with the IRS for fiscal years 2010 through 2012. |
Net_Loss_Per_Share
Net Loss Per Share | 3 Months Ended | ||||||||
Apr. 30, 2015 | |||||||||
Earnings Per Share [Abstract] | |||||||||
Net Loss Per Share | 13 | Net Loss Per Share | |||||||
Net loss per share is presented in accordance with authoritative guidance which requires the presentation of “basic” and “diluted” earnings per share. Basic net loss per share is computed by dividing earnings available to common shareholders by the weighted-average shares of common stock outstanding during the period. For the purposes of calculating diluted net loss per share, the denominator includes both the weighted average number of shares of common stock outstanding during the period and the weighted average number of shares of potential dilutive shares of common stock, such as stock options, RSUs and DSUs, calculated using the treasury stock method. Basic and diluted net loss per share was the same for all the periods presented as the impact of potential dilutive shares outstanding was anti-dilutive due to the Company’s net loss position. | |||||||||
The following table sets forth our computation of basic and diluted net loss per common share (amounts in thousands, except per share amounts): | |||||||||
Three Months Ended | |||||||||
April 30, | |||||||||
2015 | 2014 | ||||||||
Net loss | $ | (9,825 | ) | $ | (9,467 | ) | |||
Weighted average shares used in computing net loss per share - basic and diluted | 33,328 | 32,985 | |||||||
Net loss per share: | |||||||||
Basic | $ | (0.29 | ) | $ | (0.29 | ) | |||
Diluted | $ | (0.29 | ) | $ | (0.29 | ) | |||
The number of common shares used in the computation of diluted net loss per share for the three months ended April 30, 2015 and 2014 does not include the effect of the following potentially outstanding common shares because the effect would have been anti-dilutive (amounts in thousands): | |||||||||
Three Months Ended | |||||||||
April 30, | |||||||||
2015 | 2014 | ||||||||
Stock options | 1,408 | 613 | |||||||
Restricted stock units | 155 | 178 | |||||||
Deferred stock units | 6 | — | |||||||
Total | 1,569 | 791 | |||||||
Recent_Accounting_Standard_Upd
Recent Accounting Standard Updates | 3 Months Ended | |
Apr. 30, 2015 | ||
Accounting Changes and Error Corrections [Abstract] | ||
Recent Accounting Standard Updates | 14 | Recent Accounting Standard Updates |
We consider the applicability and impact of all Accounting Standards Updates. Updates not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position or results of operations. | ||
Intangibles-Goodwill and Other-Internal-Use Software | ||
In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Updates No. (“ASU”) 2015-05, “Intangibles-Goodwill and Other-Internal-Use Software – Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement.” This guidance is intended to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement, primarily to determine whether the arrangement includes a sale or license of software. ASU 2015-05 is effective for us beginning in fiscal 2017. Early adoption is permitted. Upon adoption, an entity has the option to apply the provisions of ASU 2015-05 either prospectively to all arrangements entered into or materially modified, or retrospectively. We are currently evaluating the impact of the adoption of ASU 2015-05 on our consolidated financial statements. | ||
Amendments to the Consolidation Analysis | ||
In February 2015, the FASB issued ASU 2015-02, “Amendments to the Consolidation Analysis.” ASU 2015-02 is intended to improve guidance for limited partnerships, limited liability corporations and securitization structures. The guidance places more emphasis on risk of loss when determining a controlling financial interest, reduces the frequency of the application of related-party guidance when determining a controlling financial interest in a VIE and changes consolidation conclusions for public and private companies that typically make use of limited partnerships or VIEs. This guidance is effective for us beginning in fiscal 2017. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2015-02 on our consolidated financial statements. | ||
Accounting For Share-Based Payments- Performance Target Could Be Achieved after the Requisite Service Period | ||
In June 2014, the FASB issued ASU 2014-12, “Compensation - Stock Compensation (Topic 718) – Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period.” ASU 2014-12 requires that a performance target which affects vesting and that could be achieved after the requisite service period be treated as a performance condition by applying existing guidance in Topic 718 as it relates to awards with performance conditions. The amendment also specifies the period over which compensation costs should be recognized. The amendment is effective for annual reporting periods and interim periods within those annual periods beginning after December 15, 2015. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2014-12 on our consolidated financial statements. | ||
Revenue from Contracts with Customers | ||
In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. GAAP and the International Financial Reporting Standards. This guidance supersedes previously issued guidance on revenue recognition and gives a five step process an entity should follow so that the entity recognizes revenue that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This new guidance will be effective for our fiscal 2018 reporting period and must be applied either retrospectively during each prior reporting period presented or retrospectively with the cumulative effect of initially applying this guidance recognized at the date of the initial application. Early adoption is not permitted. We are currently evaluating the impact of the adoption of this ASU on our consolidated financial statements. |
Nature_of_Business_and_Basis_o1
Nature of Business and Basis of Presentation (Policies) | 3 Months Ended | |||
Apr. 30, 2015 | ||||
Accounting Policies [Abstract] | ||||
Basis of Presentation | Basis of Presentation | |||
The accompanying unaudited consolidated financial statements include the accounts of SeaChange International, Inc. and its subsidiaries (“SeaChange” or the “Company”) and are prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial reports as well as rules and regulations of the Securities and Exchange Commission (“SEC”). All intercompany transactions and balances have been eliminated. Certain information and footnote disclosures normally included in financial statements prepared under U.S. GAAP have been condensed or omitted pursuant to such regulations. However, we believe that the disclosures are adequate to make the information presented not misleading. In the opinion of management, the accompanying financial statements include all adjustments necessary to present a fair presentation of the consolidated financial statements for the periods shown. These consolidated financial statements should be read in conjunction with our most recently audited financial statements and related footnotes included in our Annual Report on Form 10-K (“Form 10-K”) as filed with the SEC. The balance sheet data as of January 31, 2015 that is included in this Quarterly Report on Form 10-Q (“Form 10-Q”) was derived from our audited financial statements. | ||||
The preparation of these financial statements in conformity with U.S. GAAP, requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities. Interim results are not necessarily indicative of the operating results for the full fiscal year or any future periods and actual results may differ from our estimates. During the three months ended April 30, 2015, there have been no material changes to our significant accounting policies that were described in our fiscal 2015 Form 10-K, as filed with the SEC. | ||||
Fair Value Measurements | Fair Value Measurements | |||
Definition and Hierarchy | ||||
The applicable accounting guidance defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The guidance establishes a framework for measuring fair value and expands required disclosure about the fair value measurements of assets and liabilities. This guidance requires us to classify and disclose assets and liabilities measured at fair value on a recurring basis, as well as fair value measurements of assets and liabilities measured on a non-recurring basis in periods subsequent to initial measurement, in a fair value hierarchy. | ||||
The fair value hierarchy is broken down into three levels based on the reliability of inputs and requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required, as well as the assets and liabilities that we value using those levels of inputs: | ||||
• | Level 1 – Observable inputs that reflect quoted prices for identical assets or liabilities in active markets. | |||
• | Level 2 – Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not very active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |||
• | Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The fair value of the contingent consideration obligations related to our business acquisitions are valued using Level 3 inputs. | |||
Valuation Techniques | ||||
Inputs to valuation techniques are observable and unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. When developing fair value estimates for certain financial assets and liabilities, we maximize the use of observable inputs and minimize the use of unobservable inputs. When available, we use quoted market prices, market comparables and discounted cash flow projections. Financial assets include money market funds, U.S. treasury notes or bonds and U.S. government agency bonds. | ||||
In general, and where applicable, we use quoted prices in active markets for identical assets or liabilities to determine fair value. If quoted prices in active markets for identical assets or liabilities are not available to determine fair value, then we use quoted prices for similar assets and liabilities or inputs that are observable either directly or indirectly. In periods of market inactivity, the observability of prices and inputs may be reduced for certain instruments. This condition could cause an instrument to be reclassified from Level 1 to Level 2 or from Level 2 to Level 3. | ||||
Recent Accounting Standard Updates | Recent Accounting Standard Updates | |||
We consider the applicability and impact of all Accounting Standards Updates. Updates not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position or results of operations. | ||||
Intangibles-Goodwill and Other-Internal-Use Software | ||||
In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Updates No. (“ASU”) 2015-05, “Intangibles-Goodwill and Other-Internal-Use Software – Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement.” This guidance is intended to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement, primarily to determine whether the arrangement includes a sale or license of software. ASU 2015-05 is effective for us beginning in fiscal 2017. Early adoption is permitted. Upon adoption, an entity has the option to apply the provisions of ASU 2015-05 either prospectively to all arrangements entered into or materially modified, or retrospectively. We are currently evaluating the impact of the adoption of ASU 2015-05 on our consolidated financial statements. | ||||
Amendments to the Consolidation Analysis | ||||
In February 2015, the FASB issued ASU 2015-02, “Amendments to the Consolidation Analysis.” ASU 2015-02 is intended to improve guidance for limited partnerships, limited liability corporations and securitization structures. The guidance places more emphasis on risk of loss when determining a controlling financial interest, reduces the frequency of the application of related-party guidance when determining a controlling financial interest in a VIE and changes consolidation conclusions for public and private companies that typically make use of limited partnerships or VIEs. This guidance is effective for us beginning in fiscal 2017. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2015-02 on our consolidated financial statements. | ||||
Accounting For Share-Based Payments- Performance Target Could Be Achieved after the Requisite Service Period | ||||
In June 2014, the FASB issued ASU 2014-12, “Compensation - Stock Compensation (Topic 718) – Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period.” ASU 2014-12 requires that a performance target which affects vesting and that could be achieved after the requisite service period be treated as a performance condition by applying existing guidance in Topic 718 as it relates to awards with performance conditions. The amendment also specifies the period over which compensation costs should be recognized. The amendment is effective for annual reporting periods and interim periods within those annual periods beginning after December 15, 2015. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2014-12 on our consolidated financial statements. | ||||
Revenue from Contracts with Customers | ||||
In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. GAAP and the International Financial Reporting Standards. This guidance supersedes previously issued guidance on revenue recognition and gives a five step process an entity should follow so that the entity recognizes revenue that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This new guidance will be effective for our fiscal 2018 reporting period and must be applied either retrospectively during each prior reporting period presented or retrospectively with the cumulative effect of initially applying this guidance recognized at the date of the initial application. Early adoption is not permitted. We are currently evaluating the impact of the adoption of this ASU on our consolidated financial statements. |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 3 Months Ended | ||||||||||||||||
Apr. 30, 2015 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Fair Value of Financial Assets and Liabilities Measured on Recurring Basis | The following tables set forth our financial assets and liabilities that were accounted for at fair value on a recurring basis as of April 30, 2015 and January 31, 2015: | ||||||||||||||||
Fair Value at April 30, 2015 Using | |||||||||||||||||
April 30, | Quoted | Significant | Significant | ||||||||||||||
2015 | Prices in | Other | Unobservable | ||||||||||||||
Active | Observable | Inputs | |||||||||||||||
Markets for | Inputs | (Level 3) | |||||||||||||||
Identical Assets | (Level 2) | ||||||||||||||||
(Level 1) | |||||||||||||||||
(Amounts in thousands) | |||||||||||||||||
Financial assets: | |||||||||||||||||
Money market accounts (a) | $ | 3,615 | $ | 3,615 | $ | — | $ | — | |||||||||
Available for sale marketable securities: | |||||||||||||||||
Current marketable securities: | |||||||||||||||||
U.S. treasury notes and bonds - conventional | 1,500 | 1,500 | — | — | |||||||||||||
U.S. government agency issues | 2,007 | — | 2,007 | — | |||||||||||||
Non-current marketable securities: | |||||||||||||||||
U.S. treasury notes and bonds - conventional | 6,279 | 6,279 | — | — | |||||||||||||
U.S. government agency issues | 2,504 | — | 2,504 | — | |||||||||||||
Total | $ | 15,905 | $ | 11,394 | $ | 4,511 | $ | — | |||||||||
Financial liabilities: | |||||||||||||||||
Contingent consideration (b) | $ | 1,017 | $ | — | $ | — | $ | 1,017 | |||||||||
Fair Value at January 31, 2015 Using | |||||||||||||||||
January 31, | Quoted | Significant | Significant | ||||||||||||||
2015 | Prices in | Other | Unobservable | ||||||||||||||
Active | Observable | Inputs | |||||||||||||||
Markets for | Inputs | (Level 3) | |||||||||||||||
Identical Assets | (Level 2) | ||||||||||||||||
(Level 1) | |||||||||||||||||
(Amounts in thousands) | |||||||||||||||||
Financial assets: | |||||||||||||||||
Money market accounts (a) | $ | 1,575 | $ | 1,575 | $ | — | $ | — | |||||||||
Available for sale marketable securities: | |||||||||||||||||
Current marketable securities: | |||||||||||||||||
U.S. treasury notes and bonds - conventional | 1,501 | 1,501 | — | — | |||||||||||||
U.S. government agency issues | 6,015 | — | 6,015 | — | |||||||||||||
Non-current marketable securities: | |||||||||||||||||
U.S. treasury notes and bonds - conventional | 4,286 | 4,286 | |||||||||||||||
U.S. government agency issues | 2,507 | — | 2,507 | — | |||||||||||||
Total | $ | 15,884 | $ | 7,362 | $ | 8,522 | $ | — | |||||||||
(a) | Money market funds and U.S. treasury bills are included in cash and cash equivalents on the accompanying consolidated balance sheet and are valued at quoted market prices for identical instruments in active markets. | ||||||||||||||||
(b) | The fair value of our contingent consideration arrangement is determined based on management’s evaluation as to the probability of achieving certain defined performance criteria based on the expected future performance of the acquired entity, as well as the fair value of the estimated shares of the Company’s common stock to be issued. There was no change to this Level 3 liability in the three months ended April 30, 2015. | ||||||||||||||||
Summary of Available-for-Sale Securities | The following is a summary of cash, cash equivalents and available-for-sale securities, including the cost basis, aggregate fair value and gross unrealized gains and losses, for short- and long-term marketable securities portfolio as of April 30, 2015 and January 31, 2015: | ||||||||||||||||
Amortized | Gross | Gross | Estimated | ||||||||||||||
Cost | Unrealized | Unrealized | Fair Value | ||||||||||||||
Gains | Losses | ||||||||||||||||
(Amounts in thousands) | |||||||||||||||||
April 30, 2015: | |||||||||||||||||
Cash | $ | 69,356 | $ | — | $ | — | $ | 69,356 | |||||||||
Cash equivalents | 3,615 | — | — | 3,615 | |||||||||||||
Cash and cash equivalents | 72,971 | — | — | 72,971 | |||||||||||||
U.S. treasury notes and bonds - short-term | 1,499 | 1 | 1,500 | ||||||||||||||
U.S. treasury notes and bonds - long-term | 6,267 | 12 | — | 6,279 | |||||||||||||
U.S. government agency issues - short-term | 2,003 | 4 | — | 2,007 | |||||||||||||
U.S. government agency issues - long-term | 2,490 | 14 | 2,504 | ||||||||||||||
Total cash, cash equivalents and marketable securities | $ | 85,230 | $ | 31 | $ | — | $ | 85,261 | |||||||||
January 31, 2015: | |||||||||||||||||
Cash | $ | 88,444 | $ | — | $ | — | $ | 88,444 | |||||||||
Cash equivalents | 1,575 | — | — | 1,575 | |||||||||||||
Cash and cash equivalents | 90,019 | — | — | 90,019 | |||||||||||||
U.S. treasury notes and bonds - short-term | 1,500 | 1 | 1,501 | ||||||||||||||
U.S. treasury notes and bonds - long-term | 4,268 | 18 | — | 4,286 | |||||||||||||
U.S. government agency issues - short-term | 6,008 | 7 | — | 6,015 | |||||||||||||
U.S. government agency issues - long-term | 2,490 | 17 | 2,507 | ||||||||||||||
Total cash, cash equivalents and marketable securities | $ | 104,285 | $ | 43 | $ | — | $ | 104,328 | |||||||||
Schedule of Contractual Maturities Available-for-Sale Debt Securities | The following is a schedule of the contractual maturities of available-for-sale investments as of April 30, 2015 (amounts in thousands): | ||||||||||||||||
Estimated | |||||||||||||||||
Fair Value | |||||||||||||||||
Maturity of one year or less | $ | 3,507 | |||||||||||||||
Maturity between one and five years | 8,783 | ||||||||||||||||
Total | $ | 12,290 | |||||||||||||||
Acquisition_of_TLL_LLC_Tables
Acquisition of TLL, LLC (Tables) | 3 Months Ended | ||||||||
Apr. 30, 2015 | |||||||||
Business Combinations [Abstract] | |||||||||
Summary of Preliminary Allocation of Purchase Price | The preliminary allocation of the purchase price is as follows (amounts in thousands, except for share data): | ||||||||
Fair value of consideration: | |||||||||
Cash, net of cash acquired | $ | 14,186 | |||||||
Closing stock consideration | 3,025 | ||||||||
Deferred stock consideration | 6,739 | ||||||||
Contingent consideration | 514 | ||||||||
Total purchase price | $ | 24,464 | |||||||
Fair value of assets acquired and liabilities assumed: | |||||||||
Current assets | 249 | ||||||||
Other long-term assets | 108 | ||||||||
Finite-life intangible assets | 6,720 | ||||||||
Goodwill | 17,453 | ||||||||
Current liabilities | (66 | ) | |||||||
Allocated purchase price | $ | 24,464 | |||||||
Components of Identified Intangible Assets Associated with Timeline Labs Acquisition and their Estimated Useful Lives | The following table sets forth the components of the identified intangible assets associated with the Timeline Labs acquisition and their estimated useful lives: | ||||||||
Useful life | Fair Value | ||||||||
(Amounts in thousands) | |||||||||
Tradename | 7 years | $ | 620 | ||||||
Customer contracts | 7 years | 4,760 | |||||||
Non-compete agreements | 2 years | 170 | |||||||
Existing technology | 5 years | 1,170 | |||||||
$ | 6,720 | ||||||||
Inventories_Tables
Inventories (Tables) | 3 Months Ended | ||||||||
Apr. 30, 2015 | |||||||||
Inventory Disclosure [Abstract] | |||||||||
Schedule of Inventories | Inventories consist primarily of hardware and related component parts and are stated at the lower of cost (on a first-in, first-out basis) or market. Inventories consist of the following: | ||||||||
April 30, | January 31, | ||||||||
2015 | 2015 | ||||||||
(Amounts in thousands) | |||||||||
Components and assemblies | $ | 1,296 | $ | 1,487 | |||||
Finished products | 1,622 | 1,377 | |||||||
Total inventory | $ | 2,918 | $ | 2,864 | |||||
Goodwill_and_Intangible_Assets1
Goodwill and Intangible Assets (Tables) | 3 Months Ended | ||||||||||||||||||||||||||
Apr. 30, 2015 | |||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||
Schedule of Change in Carrying Amount of Goodwill | Changes in the carrying amount of goodwill for the three months ended April 30, 2015 were as follows: | ||||||||||||||||||||||||||
Goodwill | |||||||||||||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||||||||
Balance at January 31, 2015 | $ | 41,008 | |||||||||||||||||||||||||
Acquisition of Timeline Labs | 17,453 | ||||||||||||||||||||||||||
Cumulative translation adjustment | (327 | ) | |||||||||||||||||||||||||
Balance at April 30, 2015 | $ | 58,134 | |||||||||||||||||||||||||
Schedule of Intangible Assets | Intangible assets, net, consisted of the following at April 30, 2015 and January 31, 2015: | ||||||||||||||||||||||||||
As of April 30, 2015 | As of January 31, 2015 | ||||||||||||||||||||||||||
Weighted | Gross | Accumulated | Net | Gross | Accumulated | Net | |||||||||||||||||||||
average | Amortization | Amortization | |||||||||||||||||||||||||
remaining | |||||||||||||||||||||||||||
life | |||||||||||||||||||||||||||
(Years) | |||||||||||||||||||||||||||
(Amounts in thousands) | |||||||||||||||||||||||||||
Finite-life intangible assets: | |||||||||||||||||||||||||||
Customer contracts | 6.3 | $ | 34,984 | $ | (24,896 | ) | $ | 10,088 | $ | 30,397 | $ | (24,160 | ) | $ | 6,237 | ||||||||||||
Non-compete agreements | 2 | 2,576 | (2,427 | ) | 149 | 2,433 | (2,433 | ) | — | ||||||||||||||||||
Completed technology | 5.1 | 11,386 | (9,359 | ) | 2,027 | 10,307 | (9,230 | ) | 1,077 | ||||||||||||||||||
Trademarks, patents and other | 7 | 7,697 | (7,099 | ) | 598 | 7,082 | (7,082 | ) | — | ||||||||||||||||||
Total finite-life intangible assets | $ | 56,643 | $ | (43,781 | ) | $ | 12,862 | $ | 50,219 | $ | (42,905 | ) | $ | 7,314 | |||||||||||||
Schedule of Finite-Life Intangible Assets, Future Amortization Expense | As of April 30, 2015, the estimated future amortization expense for our finite-life intangible assets for the remainder of fiscal 2016, the four succeeding fiscal years and thereafter is as follows (amounts in thousands): | ||||||||||||||||||||||||||
Fiscal Year Ended January 31, | Estimated | ||||||||||||||||||||||||||
Amortization | |||||||||||||||||||||||||||
Expense | |||||||||||||||||||||||||||
2016 (for the remaining nine months) | $ | 3,423 | |||||||||||||||||||||||||
2017 | 3,244 | ||||||||||||||||||||||||||
2018 | 2,197 | ||||||||||||||||||||||||||
2019 | 1,648 | ||||||||||||||||||||||||||
2020 | 1,199 | ||||||||||||||||||||||||||
2021 and thereafter | 1,151 | ||||||||||||||||||||||||||
Total | $ | 12,862 | |||||||||||||||||||||||||
Severance_and_Other_Restructur1
Severance and Other Restructuring Costs (Tables) | 3 Months Ended | ||||
Apr. 30, 2015 | |||||
Restructuring and Related Activities [Abstract] | |||||
Change in Severance Liability | The following table shows the change in balances of our accrued severance reported as a component of other accrued expenses on the consolidated balance sheet as of April 30, 2015 (amounts in thousands): | ||||
Three Months Ended | |||||
April 30, 2015 | |||||
Accrual balance at the beginning of the period | $ | 2,021 | |||
Restructuring charges incurred | 212 | ||||
Severance costs paid | (2,037 | ) | |||
Other charges | (65 | ) | |||
Accrual balance as of April 30, 2015 | $ | 131 | |||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended | ||||||||||||
Apr. 30, 2015 | |||||||||||||
Equity [Abstract] | |||||||||||||
Schedule of Accumulated Other Comprehensive Loss | The following shows the changes in the components of accumulated other comprehensive loss for the three months ended April 30, 2015: | ||||||||||||
Foreign | Changes in | Total | |||||||||||
Currency | Fair Value of | ||||||||||||
Translation | Available | ||||||||||||
Adjustment | for Sale | ||||||||||||
Investments | |||||||||||||
(Amounts in thousands) | |||||||||||||
Balance at January 31, 2015 | $ | (5,797 | ) | $ | 43 | $ | (5,754 | ) | |||||
Other comprehensive loss | (277 | ) | (12 | ) | (289 | ) | |||||||
Balance at April 30, 2015 | $ | (6,074 | ) | $ | 31 | $ | (6,043 | ) | |||||
Segment_Information_Significan1
Segment Information, Significant Customers and Geographic Information (Tables) | 3 Months Ended | ||||||||||||||||
Apr. 30, 2015 | |||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||
Schedule of Revenue by Major Customers by Reporting Segments | The following summarizes revenues by significant customer where such revenue exceeded 10% of total revenues for the indicated period: | ||||||||||||||||
Three Months Ended | |||||||||||||||||
April 30, | |||||||||||||||||
2015 | 2014 | ||||||||||||||||
Customer A | 19 | % | 18 | % | |||||||||||||
Customer B | 17 | % | 20 | % | |||||||||||||
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area | The following table summarizes revenues by customers’ geographic locations for the periods presented: | ||||||||||||||||
Three Months Ended April 30, | |||||||||||||||||
2015 | 2014 | ||||||||||||||||
Amount | % | Amount | % | ||||||||||||||
(Amounts in thousands, except percentages) | |||||||||||||||||
Revenues by customers’ geographic locations: | |||||||||||||||||
North America(1) | $ | 13,779 | 59 | % | $ | 14,642 | 60 | % | |||||||||
Europe and Middle East | 7,566 | 33 | % | 7,697 | 32 | % | |||||||||||
Latin America | 1,098 | 5 | % | 1,649 | 7 | % | |||||||||||
Asia Pacific and other international locations | 734 | 3 | % | 349 | 1 | % | |||||||||||
Total | $ | 23,177 | $ | 24,337 | |||||||||||||
-1 | Includes total revenues for the United States for the periods shown as follows (amounts in thousands, except percentage data): | ||||||||||||||||
Three Months Ended | |||||||||||||||||
April 30, | |||||||||||||||||
2015 | 2014 | ||||||||||||||||
U.S. Revenue | $ | 11,935 | $ | 13,468 | |||||||||||||
% of total revenues | 51.5 | % | 55.3 | % |
Net_Loss_Per_Share_Tables
Net Loss Per Share (Tables) | 3 Months Ended | ||||||||
Apr. 30, 2015 | |||||||||
Earnings Per Share [Abstract] | |||||||||
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth our computation of basic and diluted net loss per common share (amounts in thousands, except per share amounts): | ||||||||
Three Months Ended | |||||||||
April 30, | |||||||||
2015 | 2014 | ||||||||
Net loss | $ | (9,825 | ) | $ | (9,467 | ) | |||
Weighted average shares used in computing net loss per share - basic and diluted | 33,328 | 32,985 | |||||||
Net loss per share: | |||||||||
Basic | $ | (0.29 | ) | $ | (0.29 | ) | |||
Diluted | $ | (0.29 | ) | $ | (0.29 | ) | |||
Schedule of Anti-dilutive Securities Excluded from Computation of Earnings Per Share | The number of common shares used in the computation of diluted net loss per share for the three months ended April 30, 2015 and 2014 does not include the effect of the following potentially outstanding common shares because the effect would have been anti-dilutive (amounts in thousands): | ||||||||
Three Months Ended | |||||||||
April 30, | |||||||||
2015 | 2014 | ||||||||
Stock options | 1,408 | 613 | |||||||
Restricted stock units | 155 | 178 | |||||||
Deferred stock units | 6 | — | |||||||
Total | 1,569 | 791 | |||||||
Fair_Value_Measurements_Fair_V
Fair Value Measurements - Fair Value of Financial Assets and Liabilities Measured on Recurring Basis (Detail) (USD $) | Apr. 30, 2015 | Jan. 31, 2015 |
In Thousands, unless otherwise specified | ||
Available for sale marketable securities: | ||
Marketable securities, short-term | $3,507 | $7,516 |
Non-current marketable securities: | ||
Marketable securities, long-term | 8,783 | 6,793 |
Total | 15,905 | 15,884 |
Financial liabilities: | ||
Contingent consideration | 1,017 | |
U.S. Treasury Notes and Bonds Conventional [Member] | ||
Available for sale marketable securities: | ||
Marketable securities, short-term | 1,500 | 1,501 |
Non-current marketable securities: | ||
Marketable securities, long-term | 6,279 | 4,286 |
U.S. Government Agency Issues Short Term [Member] | ||
Available for sale marketable securities: | ||
Marketable securities, short-term | 2,007 | 6,015 |
U.S. Government Agency Issues Long Term [Member] | ||
Non-current marketable securities: | ||
Marketable securities, long-term | 2,504 | 2,507 |
Money Market Accounts [Member] | ||
Financial assets: | ||
Cash and cash equivalents | 3,615 | 1,575 |
Fair Value, Inputs, Level 1 [Member] | ||
Non-current marketable securities: | ||
Total | 11,394 | 7,362 |
Fair Value, Inputs, Level 1 [Member] | U.S. Treasury Notes and Bonds Conventional [Member] | ||
Available for sale marketable securities: | ||
Marketable securities, short-term | 1,500 | 1,501 |
Non-current marketable securities: | ||
Marketable securities, long-term | 6,279 | 4,286 |
Fair Value, Inputs, Level 1 [Member] | Money Market Accounts [Member] | ||
Financial assets: | ||
Cash and cash equivalents | 3,615 | 1,575 |
Fair Value, Inputs, Level 2 [Member] | ||
Non-current marketable securities: | ||
Total | 4,511 | 8,522 |
Fair Value, Inputs, Level 2 [Member] | U.S. Government Agency Issues Short Term [Member] | ||
Available for sale marketable securities: | ||
Marketable securities, short-term | 2,007 | 6,015 |
Fair Value, Inputs, Level 2 [Member] | U.S. Government Agency Issues Long Term [Member] | ||
Non-current marketable securities: | ||
Marketable securities, long-term | 2,504 | 2,507 |
Fair Value, Inputs, Level 3 [Member] | ||
Financial liabilities: | ||
Contingent consideration | $1,017 |
Fair_Value_Measurements_Fair_V1
Fair Value Measurements - Fair Value of Financial Assets and Liabilities Measured on Recurring Basis (Parenthetical) (Detail) (Fair Value, Inputs, Level 3 [Member], USD $) | 3 Months Ended |
Apr. 30, 2015 | |
Fair Value, Inputs, Level 3 [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Liability, fair value adjustment | $0 |
Fair_Value_Measurements_Additi
Fair Value Measurements - Additional Information (Detail) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Apr. 30, 2015 | Jan. 31, 2015 |
Fair Value Disclosures [Abstract] | ||
Maximum maturity of marketable securities | Three months or less | |
Escrow agreement fund | $2.50 | |
Escrow reserve | 1.1 | |
Acquisition date | 2-Feb-15 | |
Cash equivalents and marketable securities | $85.30 | $105.40 |
Fair_Value_Measurements_Summar
Fair Value Measurements - Summary of Available-for-Sale Securities (Detail) (USD $) | Apr. 30, 2015 | Jan. 31, 2015 |
In Thousands, unless otherwise specified | ||
Schedule of Available-for-Sale Securities [Line Items] | ||
Amortized Cost | $85,230 | $104,285 |
Gross Unrealized Gains | 31 | 43 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 85,261 | 104,328 |
Cash [Member] | ||
Schedule of Available-for-Sale Securities [Line Items] | ||
Amortized Cost | 69,356 | 88,444 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 69,356 | 88,444 |
Cash Equivalents [Member] | ||
Schedule of Available-for-Sale Securities [Line Items] | ||
Amortized Cost | 3,615 | 1,575 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 3,615 | 1,575 |
Cash and Cash Equivalents [Member] | ||
Schedule of Available-for-Sale Securities [Line Items] | ||
Amortized Cost | 72,971 | 90,019 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 72,971 | 90,019 |
U.S. Treasury Notes and Bonds - Short Term [Member] | ||
Schedule of Available-for-Sale Securities [Line Items] | ||
Amortized Cost | 1,499 | 1,500 |
Gross Unrealized Gains | 1 | 1 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 1,500 | 1,501 |
U.S. Treasury Notes and Bonds - Long Term [Member] | ||
Schedule of Available-for-Sale Securities [Line Items] | ||
Amortized Cost | 6,267 | 4,268 |
Gross Unrealized Gains | 12 | 18 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 6,279 | 4,286 |
U.S. Government Agency Issues Short Term [Member] | ||
Schedule of Available-for-Sale Securities [Line Items] | ||
Amortized Cost | 2,003 | 6,008 |
Gross Unrealized Gains | 4 | 7 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 2,007 | 6,015 |
U.S. Government Agency Issues Long Term [Member] | ||
Schedule of Available-for-Sale Securities [Line Items] | ||
Amortized Cost | 2,490 | 2,490 |
Gross Unrealized Gains | 14 | 17 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | $2,504 | $2,507 |
Fair_Value_Measurements_Schedu
Fair Value Measurements - Schedule of Contractual Maturities Available-for-Sale Debt Securities (Detail) (USD $) | Apr. 30, 2015 |
In Thousands, unless otherwise specified | |
Fair Value Disclosures [Abstract] | |
Maturity of one year or less | $3,507 |
Maturity between one and five years | 8,783 |
Total | $12,290 |
Acquisition_of_TLL_LLC_Additio
Acquisition of TLL, LLC - Additional Information (Detail) (USD $) | 3 Months Ended | 0 Months Ended | |
Apr. 30, 2015 | Feb. 02, 2015 | Jan. 31, 2015 | |
Business Acquisition [Line Items] | |||
Payments to acquire business | $11,686,000 | ||
Contingent consideration liability, fair value | 500,000 | ||
Contingent consideration liability, fair value of employee portion | 2,700,000 | ||
Fair value of acquisition related contingent consideration | 502,000 | ||
Goodwill | 58,134,000 | 41,008,000 | |
Timeline Labs [Member] | |||
Business Acquisition [Line Items] | |||
Percentage of equity interest acquired | 100.00% | ||
Payments to acquire business | 14,186,000 | ||
Preliminary working capital adjustments | 200,000 | ||
Indemnification assets | 1,400,000 | ||
Business acquisition, number of common stock issued | 344,055 | ||
Common stock deposited into escrow | 173,265 | ||
Fair value of common stock issuance | 6,700,000 | ||
Goodwill | 17,453,000 | ||
Business acquisition related costs | $100,000 |
Acquisition_of_TLL_LLC_Summary
Acquisition of TLL, LLC - Summary of Preliminary Allocation of Purchase Price (Detail) (USD $) | 3 Months Ended | 0 Months Ended | |
In Thousands, unless otherwise specified | Apr. 30, 2015 | Feb. 02, 2015 | Jan. 31, 2015 |
Fair value of consideration: | |||
Cash, net of cash acquired | $11,686 | ||
Contingent consideration | 1,017 | ||
Fair value of assets acquired and liabilities assumed: | |||
Goodwill | 58,134 | 41,008 | |
Timeline Labs [Member] | |||
Fair value of consideration: | |||
Cash, net of cash acquired | 14,186 | ||
Closing stock consideration | 3,025 | ||
Deferred stock consideration | 6,739 | ||
Contingent consideration | 514 | ||
Total purchase price | 24,464 | ||
Fair value of assets acquired and liabilities assumed: | |||
Current assets | 249 | ||
Other long-term assets | 108 | ||
Finite-life intangible assets | 6,720 | ||
Goodwill | 17,453 | ||
Current liabilities | -66 | ||
Allocated purchase price | $24,464 |
Acquisition_of_TLL_LIC_Compone
Acquisition of TLL, LIC - Components of Identified Intangible Assets Associated with Timeline Labs Acquisition and their Estimated Useful Lives (Detail) (USD $) | 0 Months Ended | 3 Months Ended | |
In Thousands, unless otherwise specified | Feb. 02, 2015 | Apr. 30, 2015 | Feb. 02, 2015 |
Finite-Lived Intangible Assets [Line Items] | |||
Identified intangible assets, Fair Value | $6,720 | $6,720 | |
Tradename [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Identified intangible assets, Useful life | 7 years | ||
Identified intangible assets, Fair Value | 620 | 620 | |
Customer Contracts [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Identified intangible assets, Useful life | 7 years | 6 years 3 months 18 days | |
Identified intangible assets, Fair Value | 4,760 | 4,760 | |
Non-Compete Agreements [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Identified intangible assets, Useful life | 2 years | 2 years | |
Identified intangible assets, Fair Value | 170 | 170 | |
Existing Technology [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Identified intangible assets, Useful life | 5 years | ||
Identified intangible assets, Fair Value | $1,170 | $1,170 |
Inventories_Schedule_of_Invent
Inventories - Schedule of Inventories (Detail) (USD $) | Apr. 30, 2015 | Jan. 31, 2015 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ||
Components and assemblies | $1,296 | $1,487 |
Finished products | 1,622 | 1,377 |
Total inventory | $2,918 | $2,864 |
Goodwill_and_Intangible_Assets2
Goodwill and Intangible Assets - Schedule of Change in Carrying Amount of Goodwill (Detail) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Apr. 30, 2015 |
Goodwill [Roll Forward] | |
Goodwill, Beginning balance | $41,008 |
Acquisition of Timeline Labs | 17,453 |
Cumulative translation adjustment | -327 |
Goodwill, Ending balance | $58,134 |
Goodwill_and_Intangible_Assets3
Goodwill and Intangible Assets - Additional Information (Detail) (USD $) | 3 Months Ended |
Apr. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill, Impairment charges | $0 |
Goodwill_and_Intangible_Assets4
Goodwill and Intangible Assets - Schedule of Intangible Assets (Detail) (USD $) | 0 Months Ended | 3 Months Ended | |
In Thousands, unless otherwise specified | Feb. 02, 2015 | Apr. 30, 2015 | Jan. 31, 2015 |
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | |||
Finite-life intangible assets, Gross | $56,643 | $50,219 | |
Accumulated Amortization | -43,781 | -42,905 | |
Finite-life intangible assets, Net | 12,862 | 7,314 | |
Customer Contracts [Member] | |||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | |||
Weighted average remaining life (years) | 7 years | 6 years 3 months 18 days | |
Finite-life intangible assets, Gross | 34,984 | 30,397 | |
Accumulated Amortization | -24,896 | -24,160 | |
Finite-life intangible assets, Net | 10,088 | 6,237 | |
Non-Compete Agreements [Member] | |||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | |||
Weighted average remaining life (years) | 2 years | 2 years | |
Finite-life intangible assets, Gross | 2,576 | 2,433 | |
Accumulated Amortization | -2,427 | -2,433 | |
Finite-life intangible assets, Net | 149 | ||
Completed Technology [Member] | |||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | |||
Weighted average remaining life (years) | 5 years 1 month 6 days | ||
Finite-life intangible assets, Gross | 11,386 | 10,307 | |
Accumulated Amortization | -9,359 | -9,230 | |
Finite-life intangible assets, Net | 2,027 | 1,077 | |
Trademarks, Patents and Other [Member] | |||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | |||
Weighted average remaining life (years) | 7 years | ||
Finite-life intangible assets, Gross | 7,697 | 7,082 | |
Accumulated Amortization | -7,099 | -7,082 | |
Finite-life intangible assets, Net | $598 |
Goodwill_and_Intangible_Assets5
Goodwill and Intangible Assets - Schedule of Finite-Life Intangible Assets, Future Amortization Expense (Detail) (USD $) | Apr. 30, 2015 | Jan. 31, 2015 |
In Thousands, unless otherwise specified | ||
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2016 (for the remaining nine months) | $3,423 | |
2017 | 3,244 | |
2018 | 2,197 | |
2019 | 1,648 | |
2020 | 1,199 | |
2021 and thereafter | 1,151 | |
Finite-life intangible assets, Net | $12,862 | $7,314 |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Detail) (USD $) | Apr. 30, 2015 |
Commitments and Contingencies Disclosure [Abstract] | |
Demand notes payable | $20,000,000 |
Severance_and_Other_Restructur2
Severance and Other Restructuring Costs - Additional Information (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 30, 2015 | Apr. 30, 2014 |
Restructuring and Related Activities [Abstract] | ||
Restructuring charges | $212 | $474 |
Severance_and_Other_Restructur3
Severance and Other Restructuring Costs - Change in Severance Liability (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 30, 2015 | Apr. 30, 2014 |
Restructuring and Related Activities [Abstract] | ||
Accrual balance at the beginning of the period | $2,021 | |
Restructuring charges incurred | 212 | 474 |
Severance costs paid | -2,037 | |
Other charges | -65 | |
Accrual balance at the ending of the period | $131 |
Stock_Repurchase_Program_Addit
Stock Repurchase Program - Additional Information (Detail) (USD $) | 0 Months Ended | 1 Months Ended | 3 Months Ended | |||
31-May-14 | Apr. 30, 2015 | Apr. 30, 2015 | Apr. 30, 2014 | 31-May-14 | Sep. 04, 2013 | |
Equity [Abstract] | ||||||
Stock repurchase program, authorized amount | $25,000,000 | |||||
Termination date of repurchase program | 30-Apr-15 | |||||
Increase in stock repurchase program authorized amount | 40,000,000 | |||||
Stock repurchased during period, Shares | 591,520 | 0 | ||||
Common stock average price | $9.31 | |||||
Repurchases of common stock | $5,500,000 | $3,504,000 |
Stock_Incentive_Plans_Addition
Stock Incentive Plans - Additional Information (Detail) (USD $) | 3 Months Ended | 0 Months Ended | ||
Apr. 30, 2015 | Apr. 30, 2014 | Oct. 20, 2014 | Jul. 31, 2011 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation arrangement by share-based payment award, Description | Option awards may be granted to employees at an exercise price per share of not less than 100% of the fair market value per common share on the date of the grant. | |||
Share-based compensation arrangement by Share-based payment award, Option award vesting period | 3 years | |||
Share-based compensation arrangement by share based payment award, Option award expiration period | 10 years | |||
Share-based Compensation Arrangement by Share-based Payment Award, Purchase Price of Common Stock, Percent | 100.00% | |||
Stock-based compensation expense | $711,000 | $596,000 | ||
CEO [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares, Granted | 500,000 | |||
Share-based compensation arrangement by share-based payment award, options, vested in period, fair value | 1,700,000 | |||
Stock-based compensation expense | $500,000 | |||
Stock Compensation Plan [Member] | Compensation and Incentive Plan 2011 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation arrangement by share-based payment award, number of shares authorized | 5,300,000 |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Loss - Schedule of Accumulated Other Comprehensive Loss (Detail) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Apr. 30, 2015 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning balance | ($5,754) |
Other comprehensive loss | -289 |
Ending balance | -6,043 |
Cumulative Translation Adjustment [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning balance | -5,797 |
Other comprehensive loss | -277 |
Ending balance | -6,074 |
Unrealized Gain/Loss on Investments [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning balance | 43 |
Other comprehensive loss | -12 |
Ending balance | $31 |
Segment_Information_Significan2
Segment Information, Significant Customers and Geographic Information - Additional Information (Detail) | 3 Months Ended |
Apr. 30, 2015 | |
Segment | |
Segment Reporting [Abstract] | |
Number of reportable segment | 1 |
Segment_Information_Significan3
Segment Information, Significant Customers and Geographic Information - Schedule of Revenue by Major Customers by Reporting Segments (Detail) (Customer Concentration Risk [Member], Total Revenue [Member]) | 3 Months Ended | |
Apr. 30, 2015 | Apr. 30, 2014 | |
Customer A [Member] | ||
Revenue, Major Customer [Line Items] | ||
% of total revenues | 19.00% | 18.00% |
Customer B [Member] | ||
Revenue, Major Customer [Line Items] | ||
% of total revenues | 17.00% | 20.00% |
Segment_Information_Significan4
Segment Information, Significant Customers and Geographic Information - Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 30, 2015 | Apr. 30, 2014 |
Segment Reporting Information [Line Items] | ||
Total revenues | $23,177 | $24,337 |
North America [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 13,779 | 14,642 |
Europe and Middle East [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 7,566 | 7,697 |
Latin America [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 1,098 | 1,649 |
Asia Pacific and Other International Locations [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | $734 | $349 |
Total Revenue [Member] | Customer Concentration Risk [Member] | North America [Member] | ||
Segment Reporting Information [Line Items] | ||
% of total revenues | 59.00% | 60.00% |
Total Revenue [Member] | Customer Concentration Risk [Member] | Europe and Middle East [Member] | ||
Segment Reporting Information [Line Items] | ||
% of total revenues | 33.00% | 32.00% |
Total Revenue [Member] | Customer Concentration Risk [Member] | Latin America [Member] | ||
Segment Reporting Information [Line Items] | ||
% of total revenues | 5.00% | 7.00% |
Total Revenue [Member] | Customer Concentration Risk [Member] | Asia Pacific and Other International Locations [Member] | ||
Segment Reporting Information [Line Items] | ||
% of total revenues | 3.00% | 1.00% |
Segment_Information_Significan5
Segment Information, Significant Customers and Geographic Information - Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area (Parenthetical) (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 30, 2015 | Apr. 30, 2014 |
Segment Reporting Information [Line Items] | ||
Total revenues | $23,177 | $24,337 |
United States Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | $11,935 | $13,468 |
Customer Concentration Risk [Member] | United States Revenue [Member] | Total Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
% of total revenues | 51.50% | 55.30% |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 30, 2015 | Apr. 30, 2014 |
Income Tax Disclosure [Abstract] | ||
Income tax provision (benefit) | $147 | ($234) |
Net_Loss_Per_Share_Schedule_of
Net Loss Per Share - Schedule of Earnings Per Share, Basic and Diluted (Detail) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Apr. 30, 2015 | Apr. 30, 2014 |
Earnings Per Share [Abstract] | ||
Net loss | ($9,825) | ($9,467) |
Weighted average shares used in computing net loss per share - basic and diluted | 33,328 | 32,985 |
Net loss per share: | ||
Basic | ($0.29) | ($0.29) |
Diluted | ($0.29) | ($0.29) |
Net_Loss_Per_Share_Schedule_of1
Net Loss Per Share - Schedule of Anti-dilutive Securities Excluded from Computation of Earnings Per Share (Detail) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 30, 2015 | Apr. 30, 2014 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive potentially outstanding common shares | 1,569 | 791 |
Stock Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive potentially outstanding common shares | 1,408 | 613 |
Restricted Stock Units [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive potentially outstanding common shares | 155 | 178 |
Deferred Stock Units [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive potentially outstanding common shares | 6 |