Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 05, 2020 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | UNIVERSAL ELECTRONICS INC | |
Entity Central Index Key | 0000101984 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 13,913,019 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 58,927 | $ 74,302 |
Accounts receivable, net | 137,094 | 139,198 |
Contract assets | 9,911 | 12,579 |
Inventories | 142,243 | 145,135 |
Prepaid expenses and other current assets | 6,427 | 6,733 |
Income tax receivable | 1,573 | 805 |
Total current assets | 356,175 | 378,752 |
Property, plant and equipment, net | 85,304 | 90,732 |
Goodwill | 48,416 | 48,447 |
Intangible assets, net | 19,284 | 19,830 |
Operating lease right-of-use assets | 18,359 | 19,826 |
Deferred income taxes | 4,078 | 4,409 |
Other assets | 2,618 | 2,163 |
Total assets | 534,234 | 564,159 |
Current liabilities: | ||
Accounts payable | 89,558 | 102,588 |
Line of credit | 78,000 | 68,000 |
Accrued compensation | 31,837 | 43,668 |
Accrued sales discounts, rebates and royalties | 9,000 | 9,766 |
Accrued income taxes | 6,693 | 6,989 |
Other accrued liabilities | 31,081 | 35,445 |
Total current liabilities | 246,169 | 266,456 |
Long-term liabilities: | ||
Operating lease obligations | 14,069 | 15,639 |
Contingent consideration | 195 | 4,349 |
Deferred income taxes | 2,461 | 1,703 |
Income tax payable | 1,368 | 1,600 |
Other long-term liabilities | 13 | 13 |
Total liabilities | 264,275 | 289,760 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.01 par value, 5,000,000 shares authorized; none issued or outstanding | 0 | 0 |
Common stock, $0.01 par value, 50,000,000 shares authorized; 24,255,522 and 24,118,088 shares issued on March 31, 2020 and December 31, 2019, respectively | 243 | 241 |
Paid-in capital | 291,350 | 288,338 |
Treasury stock, at cost, 10,343,366 and 10,174,199 shares on March 31, 2020 and December 31, 2019, respectively | (284,108) | (277,817) |
Accumulated other comprehensive income (loss) | (29,790) | (22,781) |
Retained earnings | 292,264 | 286,418 |
Total stockholders' equity | 269,959 | 274,399 |
Total liabilities and stockholders' equity | $ 534,234 | $ 564,159 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Stockholders' equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 24,255,522 | 24,118,088 |
Treasury stock, shares (in shares) | 10,343,366 | 10,174,199 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
Net sales | $ 151,778 | $ 184,163 |
Cost of sales | 108,837 | 144,289 |
Gross profit | 42,941 | 39,874 |
Research and development expenses | 7,898 | 6,791 |
Selling, general and administrative expenses | 26,997 | 31,420 |
Operating income | 8,046 | 1,663 |
Interest income (expense), net | (632) | (1,206) |
Other income (expense), net | (348) | (466) |
Income (loss) before provision for income taxes | 7,066 | (9) |
Provision for income taxes | 1,220 | 996 |
Net income (loss) | $ 5,846 | $ (1,005) |
Earnings (loss) per share: | ||
Basic (in dollars per share) | $ 0.42 | $ (0.07) |
Diluted (in dollars per share) | $ 0.41 | $ (0.07) |
Shares used in computing earnings (loss) per share: | ||
Basic (in shares) | 13,960 | 13,827 |
Diluted (in shares) | 14,211 | 13,827 |
CONSOLIDATED COMPREHENSIVE INCO
CONSOLIDATED COMPREHENSIVE INCOME (LOSS) STATEMENTS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 5,846 | $ (1,005) |
Other comprehensive income (loss): | ||
Change in foreign currency translation adjustment | (7,009) | 1,733 |
Comprehensive income (loss) | $ (1,163) | $ 728 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock Issued | Common Stock in Treasury | Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings |
Balance (in shares) at Dec. 31, 2018 | 23,933 | (10,116) | ||||
Balance at Dec. 31, 2018 | $ 262,960 | $ 239 | $ (275,889) | $ 276,103 | $ (20,281) | $ 282,788 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (1,005) | (1,005) | ||||
Currency translation adjustment | 1,733 | |||||
Shares issued for employee benefit plan and compensation (in shares) | 78 | |||||
Shares issued for employee benefit plan and compensation | $ 347 | $ 1 | 346 | |||
Purchase of treasury shares (in shares) | (43) | (43) | ||||
Purchase of treasury shares | $ (1,215) | $ (1,215) | ||||
Shares issued to directors (in shares) | 8 | |||||
Shares issued to directors | 0 | $ 0 | 0 | |||
Employee and director stock-based compensation | 1,918 | 1,918 | ||||
Performance-based common stock warrants | 434 | 434 | ||||
Balance (in shares) at Mar. 31, 2019 | 24,019 | (10,159) | ||||
Balance at Mar. 31, 2019 | 265,172 | $ 240 | $ (277,104) | 278,801 | (18,548) | 281,783 |
Balance (in shares) at Dec. 31, 2019 | 24,118 | (10,174) | ||||
Balance at Dec. 31, 2019 | 274,399 | $ 241 | $ (277,817) | 288,338 | (22,781) | 286,418 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 5,846 | 5,846 | ||||
Currency translation adjustment | (7,009) | |||||
Shares issued for employee benefit plan and compensation (in shares) | 129 | |||||
Shares issued for employee benefit plan and compensation | $ 527 | $ 1 | 526 | |||
Purchase of treasury shares (in shares) | (169) | (169) | ||||
Purchase of treasury shares | $ (6,291) | $ (6,291) | ||||
Shares issued to directors (in shares) | 9 | |||||
Shares issued to directors | 0 | $ 1 | (1) | |||
Employee and director stock-based compensation | 2,303 | 2,303 | ||||
Performance-based common stock warrants | 184 | 184 | ||||
Balance (in shares) at Mar. 31, 2020 | 24,256 | (10,343) | ||||
Balance at Mar. 31, 2020 | $ 269,959 | $ 243 | $ (284,108) | $ 291,350 | $ (29,790) | $ 292,264 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash provided by (used for) operating activities: | ||
Net income (loss) | $ 5,846 | $ (1,005) |
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities: | ||
Depreciation and amortization | 7,498 | 8,019 |
Provision for bad debts | 237 | 3 |
Deferred income taxes | 835 | 2,966 |
Shares issued for employee benefit plan | 527 | 347 |
Employee and director stock-based compensation | 2,303 | 1,918 |
Performance-based common stock warrants | 184 | 434 |
Loss on sale of Ohio call center | 712 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable and contract assets | 2,060 | (14,056) |
Inventories | 1,609 | (3,982) |
Prepaid expenses and other assets | 118 | 735 |
Accounts payable and accrued liabilities | (28,969) | 3,017 |
Accrued income taxes | (1,307) | (2,943) |
Net cash provided by (used for) operating activities | (8,347) | (4,547) |
Cash provided by (used for) investing activities: | ||
Acquisitions of property, plant and equipment | (1,986) | (2,800) |
Acquisitions of intangible assets | (1,270) | (653) |
Payment on sale of Ohio call center | (500) | 0 |
Net cash provided by (used for) investing activities | (3,756) | (3,453) |
Cash provided by (used for) financing activities: | ||
Borrowings under line of credit | 25,000 | 25,000 |
Repayments on line of credit | (15,000) | (20,000) |
Treasury stock purchased | (6,291) | (1,215) |
Contingent consideration payments in connection with business combinations | (3,091) | (4,251) |
Net cash provided by (used for) financing activities | 618 | (466) |
Effect of exchange rate changes on cash and cash equivalents | (3,890) | 154 |
Net increase (decrease) in cash and cash equivalents | (15,375) | (8,312) |
Cash and cash equivalents at beginning of period | 74,302 | 53,207 |
Cash and cash equivalents at end of period | 58,927 | 44,895 |
Supplemental cash flow information: | ||
Income taxes paid | 1,384 | 1,942 |
Interest paid | $ 637 | $ 1,186 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation In the opinion of management, the accompanying consolidated financial statements of Universal Electronics Inc. and its subsidiaries contain all the adjustments necessary for a fair presentation of financial position, results of operations and cash flows for the periods presented. All such adjustments are of a normal recurring nature and certain reclassifications have been made to prior year amounts in order to conform to the current year presentation. Information and footnote disclosures normally included in financial statements, which are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"), have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). As used herein, the terms "Company," "we," "us," and "our" refer to Universal Electronics Inc. and its subsidiaries, unless the context indicates to the contrary. Our results of operations for the three months ended March 31, 2020 are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Quantitative and Qualitative Disclosures About Market Risk," and the "Financial Statements and Supplementary Data" included in Items 1A, 7, 7A, and 8, respectively, of our Annual Report on Form 10-K for the year ended December 31, 2019 . Estimates, Judgments and Assumptions The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, we evaluate our estimates and assumptions, including those related to revenue recognition, allowances for bad debts, inventory valuation, our review for impairment of long-lived assets, intangible assets and goodwill, business combinations, income taxes, stock-based compensation expense and performance-based common stock warrants. The recent coronavirus ("COVID-19") pandemic and the mitigation efforts by governments to attempt to control its spread has created uncertainties and disruptions in the economic and financial markets. While we are not currently aware of events or circumstances that would require an update to our estimates, judgments or adjustments to the carrying values of our assets or liabilities, these estimates may change as developments occur and we obtain additional information. These future developments are highly uncertain and the outcomes are unpredictable. Actual results may differ from those estimates, and such differences may be material to the financial statements. See Note 2 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2019 for a summary of our significant accounting policies. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, "Measurement of Credit Losses on Financial Instruments", which updates existing guidance for measuring and recording credit losses on financial assets measured at amortized cost by replacing the incurred loss impairment model with an expected loss impairment model. Accordingly, financial assets are presented at amortized costs net of an allowance for expected credit losses over the lifetime of the assets. We adopted this new guidance on January 1, 2020 using the modified retrospective method. The adoption did not require an implementation adjustment and did not materially impact our consolidated statement of financial position, results of operations and cash flows. See Note 3 for further discussion on our allowance for bad debts. In January 2017, the FASB issued ASU 2017-04, "Simplifying the Test for Goodwill Impairment", which simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to the reporting unit. Our adoption on January 1, 2020 did not have a material impact on our consolidated statement of financial position, results of operations and cash flows. In November 2019, the FASB issued ASU 2019-08, "Improvements - Share-based Consideration Payable to a Customer", which clarifies the accounting for share-based payments issued as sales incentives to customers. The guidance requires that stock-based compensation expense is recorded as a reduction in the transaction price on the basis of the grant-date fair value. The grant-date fair value is calculated using the provisions defined under Accounting Standards Codification "Stock Compensation". The transition provisions require that equity-classified awards be measured at the adoption date fair value if the measurement date has not been established prior to the adoption date. This guidance impacts the measurement date of our performance-based common stock warrants. The measurement periods for the first two successive two-year periods of our outstanding performance-based common stock warrants were completed prior to adoption and were not impacted by this updated guidance. The measurement period for the final two-year period began on January 1, 2020, and accordingly, we measured the fair value of the award as of our adoption date on January 1, 2020. We adopted this guidance using the modified retrospective method. Our adoption did not result in a cumulative adjustment in our statement of financial position. See Note 15 for further discussion on the performance-based common stock warrants. Recent Accounting Updates Not Yet Effective In December 2019, the FASB issued ASU 2019-12 "Simplifying the Accounting for Income Taxes", which among other provisions, eliminates certain exceptions to existing guidance related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. This guidance also requires an entity to reflect the effect of an enacted change in tax laws or rates in its effective income tax rate in the first interim period that includes the enactment date of the new legislation, aligning the timing of recognition of the effects from enacted tax law changes on the effective income tax rate with the effects on deferred income tax assets and liabilities. Under existing guidance, an entity recognizes the effects of the enacted tax law change on the effective income tax rate in the period that includes the effective date of the tax law. The guidance is effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. We are currently evaluating the impact of this guidance on our consolidated statement of financial position, results of operations and cash flows. |
Cash and Cash Equivalents
Cash and Cash Equivalents | 3 Months Ended |
Mar. 31, 2020 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents were held in the following geographic regions: (In thousands) March 31, 2020 December 31, 2019 United States $ 10,421 $ 16,751 People's Republic of China ("PRC") 14,105 13,700 Asia (excluding the PRC) 11,052 21,691 Europe 12,810 9,081 South America 10,539 13,079 Total cash and cash equivalents $ 58,927 $ 74,302 |
Revenue and Accounts Receivable
Revenue and Accounts Receivable, Net | 3 Months Ended |
Mar. 31, 2020 | |
Receivables [Abstract] | |
Revenue and Accounts Receivable, Net | Revenue and Accounts Receivable, Net Revenue Details The pattern of revenue recognition was as follows: Three Months Ended March 31, (In thousands) 2020 2019 Goods and services transferred at a point in time $ 117,058 $ 136,338 Goods and services transferred over time 34,720 47,825 Net sales $ 151,778 $ 184,163 Our net sales to external customers by geographic area were as follows: Three Months Ended March 31, (In thousands) 2020 2019 United States $ 74,381 $ 98,936 Asia (excluding PRC) 27,825 24,076 Europe 20,502 23,299 People's Republic of China 17,517 22,308 Latin America 4,640 7,787 Other 6,913 7,757 Total net sales $ 151,778 $ 184,163 Specific identification of the customer billing location was the basis used for attributing revenues from external customers to geographic areas. Net sales to the following customers totaled more than 10% of our net sales: Three Months Ended March 31, 2020 2019 $ (thousands) % of Net Sales $ (thousands) % of Net Sales Comcast Corporation $ 32,935 21.7 % $ 29,246 15.9 % DISH Network Corporation — (1) — (1) $ 19,678 10.7 % (1) Sales associated with this customer did not total more than 10% of our net sales for the indicated period. Accounts Receivable, Net Accounts receivable, net were as follows: (In thousands) March 31, 2020 December 31, 2019 Trade receivables, gross $ 129,316 $ 130,888 Allowance for bad debts (1,681 ) (1,492 ) Allowance for sales returns (495 ) (623 ) Net trade receivables 127,140 128,773 Other 9,954 10,425 Accounts receivable, net $ 137,094 $ 139,198 Allowance for Bad Debts Changes in the allowance for bad debts were as follows: (In thousands) Three Months Ended March 31, 2020 2019 Balance at beginning of period $ 1,492 $ 1,121 Additions to costs and expenses 237 3 (Write-offs)/Foreign exchange effects (48 ) (4 ) Balance at end of period $ 1,681 $ 1,120 Trade receivables associated with these significant customers that totaled more than 10% of our accounts receivable, net were as follows: March 31, 2020 December 31, 2019 $ (thousands) % of Accounts Receivable, Net $ (thousands) % of Accounts Receivable, Net Comcast Corporation $ 28,423 20.7 % — (1) — (1) DISH Network Corporation — (1) — (1) $ 14,677 10.5 % (1) Trade receivables associated with this customer did not total more than 10% of our accounts receivable, net for the indicated period. |
Inventories and Significant Sup
Inventories and Significant Suppliers | 3 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories and Significant Suppliers | Inventories and Significant Suppliers Inventories were as follows: (In thousands) March 31, 2020 December 31, 2019 Raw materials $ 59,409 $ 56,352 Components 18,925 24,599 Work in process 5,240 1,526 Finished goods 58,669 62,658 Inventories $ 142,243 $ 145,135 Significant Suppliers We purchase integrated circuits, components and finished goods from multiple sources. Purchases from the following supplier totaled more than 10% of our total inventory purchases: Three Months Ended March 31, 2020 2019 $ (thousands) % of Total Inventory Purchases $ (thousands) % of Total Inventory Purchases Qorvo International Pte Ltd. $ 11,177 14.0 % — (1) — (1) (1) Purchases associated with this supplier did not total more than 10% of our total inventory purchases for the indicated period. The supplier that totaled more than 10% of our accounts payable, was as follows: March 31, 2020 December 31, 2019 $ (thousands) % of Accounts Payable $ (thousands) % of Accounts Payable Zhejiang Zhen You Electronics Co. Ltd. $ 9,330 10.4 % $ 11,394 11.1 % |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases We have entered into various operating lease agreements for automobiles, offices and manufacturing facilities throughout the world. At March 31, 2020 , our operating leases had remaining lease terms of up to 41 years . Lease balances within our consolidated balance sheet were as follows: (In thousands) March 31, 2020 December 31, 2019 Assets: Operating lease right-of-use assets $ 18,359 $ 19,826 Liabilities: Other accrued liabilities $ 5,030 $ 4,903 Long-term operating lease obligations 14,069 15,639 Total lease liabilities $ 19,099 $ 20,542 Operating lease expense, including variable and short-term lease costs which were insignificant to the total, operating lease cash flows and supplemental cash flow information were as follows: (In thousands) Three Months Ended March 31, 2020 2019 Cost of sales $ 390 $ 592 Selling, general and administrative expenses 998 1,384 Total operating lease expense $ 1,388 $ 1,976 Operating cash outflows from operating leases $ 1,525 $ 1,767 Operating lease right-of-use assets obtained in exchange for lease obligations $ 186 $ 1,524 The weighted average remaining lease liability term and the weighted average discount rate were as follows: March 31, 2020 Weighted average lease liability term (in years) 4.10 Weighted average discount rate 4.51 % The following table reconciles the undiscounted cash flows for each of the first five years and thereafter to the operating lease liabilities recognized in our consolidated balance sheet at March 31, 2020 . The reconciliation excludes short-term leases that are not recorded on the balance sheet. (In thousands) March 31, 2020 2020 (remaining 9 months) $ 4,419 2021 6,256 2022 5,250 2023 2,399 2024 1,343 Thereafter 2,040 Total lease payments 21,707 Less: imputed interest (2,608 ) Total lease liabilities $ 19,099 At March 31, 2020 , we had one operating lease with a five -year term that had not yet commenced. The total initial lease liability of approximately $1.6 million is not reflected within the above maturity schedule. |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, Net | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets, Net | Goodwill and Intangible Assets, Net Goodwill Changes in the carrying amount of goodwill were as follows: (In thousands) Balance at December 31, 2019 $ 48,447 Foreign exchange effects (31 ) Balance at March 31, 2020 $ 48,416 Intangible Assets, Net The components of intangible assets, net were as follows: March 31, 2020 December 31, 2019 (In thousands) Gross (1) Accumulated Amortization (1) Net Gross (1) Accumulated Amortization (1) Net Distribution rights $ 316 $ (213 ) $ 103 $ 322 $ (210 ) $ 112 Patents 17,625 (6,705 ) 10,920 16,587 (6,491 ) 10,096 Trademarks and trade names 2,786 (2,282 ) 504 2,785 (2,205 ) 580 Developed and core technology 12,480 (10,515 ) 1,965 12,480 (10,016 ) 2,464 Capitalized software development costs 33 — 33 — — — Customer relationships 32,534 (26,775 ) 5,759 32,534 (25,956 ) 6,578 Total intangible assets, net $ 65,774 $ (46,490 ) $ 19,284 $ 64,708 $ (44,878 ) $ 19,830 (1) This table excludes the gross value of fully amortized intangible assets totaling $7.6 million and $7.4 million at March 31, 2020 and December 31, 2019 , respectively. Amortization expense, which was recognized in selling, general and administrative expenses, was $1.8 million and $1.8 million during the three months ended March 31, 2020 and 2019 , respectively. Estimated future annual amortization expense related to our intangible assets at March 31, 2020 , was as follows: (In thousands) 2020 (remaining 9 months) $ 4,333 2021 2,573 2022 2,575 2023 2,396 2024 1,817 Thereafter 5,590 Total $ 19,284 |
Line of Credit
Line of Credit | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Line of Credit | Line of Credit Our Second Amended and Restated Credit Agreement ("Second Amended Credit Agreement") with U.S. Bank National Association ("U.S. Bank") provides for a $125.0 million revolving line of credit ("Credit Line") that expires on November 1, 2021. The Credit Line may be used for working capital and other general corporate purposes including acquisitions, share repurchases and capital expenditures. Amounts available for borrowing under the Credit Line are reduced by the balance of any outstanding letters of credit, of which there were $2.7 million at March 31, 2020 . All obligations under the Credit Line are secured by substantially all of our U.S. personal property and tangible and intangible assets as well as 65% of our ownership interest in Enson Assets Limited, our wholly-owned subsidiary which controls our manufacturing factories in the PRC. Under the Second Amended Credit Agreement, we may elect to pay interest on the Credit Line based on LIBOR plus an applicable margin (varying from 1.25% to 1.75% ) or base rate (based on the prime rate of U.S. Bank or as otherwise specified in the Second Amended Credit Agreement) plus an applicable margin (varying from 0.00% to 0.50% ). The applicable margins are calculated quarterly and vary based on our cash flow leverage ratio as set forth in the Second Amended Credit Agreement. The interest rate in effect at March 31, 2020 was 2.20% . There are no commitment fees or unused line fees under the Second Amended Credit Agreement. The Second Amended Credit Agreement includes financial covenants requiring a minimum fixed charge coverage ratio and a maximum cash flow leverage ratio. In addition, the Second Amended Credit Agreement contains other customary affirmative and negative covenants and events of default. At March 31, 2020 , we were in compliance with the covenants and conditions of the Second Amended Credit Agreement. At March 31, 2020 , we had $78.0 million outstanding under the Credit Line. Our total interest expense on borrowings was $0.7 million and $1.3 million during the three months ended March 31, 2020 and 2019 , respectively. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We utilize our estimated annual effective tax rate to determine our provision for income taxes for interim periods. The income tax provision is computed by taking the estimated annual effective rate and multiplying it by the year-to-date pre-tax book income. We recorded income tax expense of $1.2 million and $1.0 million for the three months ended March 31, 2020 and 2019 , respectively. The income tax expense for the three months ended March 31, 2020 increased primarily due to the mix of pre-tax income among jurisdictions, including tax expense not recognized for federal and state as a result of utilized tax attributes that have a full valuation allowance and tax windfalls related to stock-based compensation. At December 31, 2019 , we assessed the realizability of our deferred tax assets by considering whether it is "more likely than not" some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. We considered taxable income in carryback years, the scheduled reversal of deferred tax liabilities, tax planning strategies and projected future taxable income in making this assessment. At December 31, 2019 , we had a three-year cumulative operating loss for our U.S. operations and accordingly, have provided a full valuation allowance on our U.S. and state deferred tax assets. During the three months ended March 31, 2020 , there has been no change to our valuation allowance position. At March 31, 2020 , we had gross unrecognized tax benefits of $4.3 million , including interest and penalties, of which approximately $4.3 million of this amount, if not for the state Research and Experimentation income tax credit valuation allowance, would affect the annual effective tax rate if these tax benefits are realized. Further, we are unaware of any positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly increase within the next twelve months. However, based on federal, state and foreign statute expirations in various jurisdictions, we anticipate a decrease in unrecognized tax benefits of approximately $0.2 million within the next twelve months based on federal, state, and foreign statute expirations in various jurisdictions. We have classified uncertain tax positions as non-current income tax liabilities unless expected to be paid within one year. We have elected to classify interest and penalties as a component of tax expense. Accrued interest and penalties of $0.2 million as of March 31, 2020 and $0.2 million at December 31, 2019 are included in the unrecognized tax benefits. On March 18, 2020 and March 22, 2020, the Families First Coronavirus Response ("FFCR") Act and the Coronavirus Aid, Relief and Economic Security ("CARES") Act, respectively, were enacted in response to the COVID-19 pandemic. The FFCR Act and the CARES Act contain numerous income tax provisions, such as relaxing limitations on the deductibility of interest and the use of net operating losses arising in taxable years beginning after December 31, 2017. We are currently evaluating the impact of this legislation on our consolidated financial position, results of operations, and cash flows. Future regulatory guidance under the FFCR and CARES Acts (as well as under the Tax Cuts and Jobs Act) remains forthcoming and such guidance may ultimately increase or lessen their impact on our business and financial condition. It is also highly possible that Congress will enact additional legislation in connection with the COVID-19 pandemic, some of which may impact us. In April 2020, recent interpretations of a German law relating to withholding taxes on intellectual property rights emerged. The company is currently evaluating this law and any related impact to its financial position and results of operations. |
Accrued Compensation
Accrued Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Payables and Accruals [Abstract] | |
Accrued Compensation | Accrued Compensation The components of accrued compensation were as follows: (In thousands) March 31, 2020 December 31, 2019 Accrued social insurance (1) $ 16,479 $ 16,588 Accrued salary/wages 7,181 7,465 Accrued vacation/holiday 2,936 2,766 Accrued bonus 3,200 13,965 Accrued commission 271 1,283 Other accrued compensation 1,770 1,601 Total accrued compensation $ 31,837 $ 43,668 (1) PRC employers are required by law to remit the applicable social insurance payments to their local government. Social insurance is comprised of various components such as pension, medical insurance, job industry insurance, unemployment insurance, and a housing assistance fund, and is administered in a manner similar to social security in the United States. This amount represents our estimate of the amounts due to the PRC government for social insurance on March 31, 2020 and December 31, 2019 . Other Accrued Liabilities The components of other accrued liabilities were as follows: (In thousands) March 31, 2020 December 31, 2019 Contract liabilities $ 1,694 $ 1,840 Duties 3,585 3,731 Freight and handling fees 3,251 3,769 Operating lease obligations 5,030 4,903 Product warranty claim costs 1,498 1,514 Professional fees 3,232 2,833 Sales taxes and VAT 2,829 3,926 Short-term contingent consideration 3,300 5,428 Other 6,662 7,501 Total other accrued liabilities $ 31,081 $ 35,445 |
Other Accrued Liabilities
Other Accrued Liabilities | 3 Months Ended |
Mar. 31, 2020 | |
Payables and Accruals [Abstract] | |
Other Accrued Liabilities | Accrued Compensation The components of accrued compensation were as follows: (In thousands) March 31, 2020 December 31, 2019 Accrued social insurance (1) $ 16,479 $ 16,588 Accrued salary/wages 7,181 7,465 Accrued vacation/holiday 2,936 2,766 Accrued bonus 3,200 13,965 Accrued commission 271 1,283 Other accrued compensation 1,770 1,601 Total accrued compensation $ 31,837 $ 43,668 (1) PRC employers are required by law to remit the applicable social insurance payments to their local government. Social insurance is comprised of various components such as pension, medical insurance, job industry insurance, unemployment insurance, and a housing assistance fund, and is administered in a manner similar to social security in the United States. This amount represents our estimate of the amounts due to the PRC government for social insurance on March 31, 2020 and December 31, 2019 . Other Accrued Liabilities The components of other accrued liabilities were as follows: (In thousands) March 31, 2020 December 31, 2019 Contract liabilities $ 1,694 $ 1,840 Duties 3,585 3,731 Freight and handling fees 3,251 3,769 Operating lease obligations 5,030 4,903 Product warranty claim costs 1,498 1,514 Professional fees 3,232 2,833 Sales taxes and VAT 2,829 3,926 Short-term contingent consideration 3,300 5,428 Other 6,662 7,501 Total other accrued liabilities $ 31,081 $ 35,445 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Product Warranties Changes in the liability for product warranty claim costs were as follows: (In thousands) Three Months Ended March 31, 2020 2019 Balance at beginning of period $ 1,514 $ 276 Accruals for warranties issued during the period — — Settlements (in cash or in kind) during the period/Foreign exchange effects (16 ) — Balance at end of period $ 1,498 $ 276 Litigation Ruwido Matters Belgium Lawsuits On or about June 10, 2015, FM Marketing GmbH ("FMH") and Ruwido Austria GmbH ("Ruwido") filed a Summons in Summary Proceedings in Belgium court against one of our subsidiaries, Universal Electronics BV ("UEBV"), and one of its customers, Telenet N.V. ("Telenet"), claiming that one of the products UEBV supplied to Telenet violates two design patents and one utility patent owned by FMH and/or Ruwido. By this summons, FMH and Ruwido sought to enjoin Telenet and UEBV from continued distribution and use of the product at issue. After the September 29, 2015 hearing, the court issued its ruling in our and Telenet’s favor, rejecting FMH and Ruwido’s request entirely. On October 22, 2015, Ruwido filed its notice of appeal to this ruling. On September 16, 2019, the appellate court ruled in our favor concluding that our original product did not infringe Ruwido's design rights. Ruwido subsequently filed an appeal of this decision with the Belgium Supreme Court. All parties have submitted their briefs with the Supreme Court and we are waiting for the Supreme Court to set an oral hearing date which we expect to be in late 2021. In addition, Ruwido appealed the lower court's ruling against it with respect to its claims of infringement and unfair competition. Briefing on this appeal is expected to be completed by June 3, 2020, after which the appellate court will set an oral hearing which we expect to be sometime in 2021. Subsequent to the Court's ruling in September 2017 that our second product could not be added to the first case on the merits, Ruwido filed a separate case on the merits with respect to this second product, claiming that it too infringes the same patent at issue in the first suit. We have denied these claims. The Court has postponed oral hearing on the merits with respect to this matter to March 2, 2021. European Patent Opposition In September 2015, UEBV filed an Opposition with the EPO seeking to invalidate the one utility patent asserted against UEBV and Telenet by Ruwido. The hearing on this opposition was held in July 2017. During this hearing the panel requested additional information. We submitted this additional information and the EPO held a second hearing on January 29 and 30, 2019 and revoked Ruwido's patent as originally filed. The EPO, however, maintained the patent in an amended form with a much narrower claim. On August 23, 2019, the EPO issued its written opinion. Both UEBV and Ruwido have appealed the EPO's decision and briefing is due by May 13, 2020. Thereafter, we expect the EPO to set a date for an additional hearing, after which the EPO will render its decision. The Netherlands Lawsuit In September 2017, FMH and Ruwido filed a lawsuit on the merits in the Court of the Hague against UEBV and Telenet, in which they are also claiming that the products UEBV supplied to Telenet violates the same patents as claimed in the Belgium actions. In early 2019, oral hearings took place during which the Court ordered the parties to submit statements relating to the consequences of the EPO decision to the Dutch proceedings. Ruwido has recently submitted its statement and we have until May 13, 2020 to submit our response. Roku Matters 2018 Lawsuit On September 5, 2018, we filed a lawsuit against Roku, Inc. (“Roku”) in the United States District Court, Central District of California, alleging that Roku is willfully infringing nine of our patents that are in four patent families related to remote control set-up and touchscreen remotes. On December 5, 2018, we amended our complaint to add additional details supporting our infringement and willfulness allegations. We have alleged that this complaint relates to multiple Roku streaming players and components therefore and certain universal control devices, including but not limited to the Roku App, Roku TV, Roku Express, Roku Streaming Stick, Roku Ultra, Roku Premiere, Roku 4, Roku 3, Roku 2, Roku Enhanced Remote and any other Roku product that provides for the remote control of an external device such as a TV, audiovisual receiver, sound bar or Roku TV Wireless Speakers. In October 2019, the Court stayed this lawsuit pending action by the Patent Trial and Appeals Board with respect to Roku’s Inter Party Review requests (see discussion below). Inter Party Reviews In September and October, 2019, Roku filed Inter Party Review (“IPR”) requests with the Patent Trial and Appeals Board (the “PTAB”) on the nine patents at issue in the 2018 Lawsuit. Presently, the PTAB denied Roku’s request with respect to three of the nine patents and granted Roku’s request with respect to four of the nine patents. We expect the PTAB’s decision on the remaining two IPR requests by May 14, 2020. As for those IPRs for which the PTAB granted Roku’s request for review, we will vigorously defend our patents. International Trade Commission Investigation of Roku, TCL, Hisense and Funai On April 16, 2020, we filed a complaint with the International Trade Commisssion (the “ITC”) against Roku, TCL Electronics Holding Limited and related entities (collectively, “TCL”), Hisense Co., Ltd. and related entities (collectively, “Hisense”), and Funai Electric Company, Ltd. and related entities (collectively, “Funai”) claiming that certain of their televisions, set-top boxes, remote control devices, human interface devices, streaming devices, and sound bars infringe certain of our patents. We are asking the ITC to issue a permanent limited exclusion order prohibiting the importation of these infringing products into the United States and a cease and desist order to stop these parties from continuing their infringing activities. We expect the ITC to accept our complaint by the end of May 2020 and commence its investigation. Federal District Court Actions against each of Roku, TCL, Hisense, and Funai related to the ITC Matter On April 9, 2020, we filed separate actions against each of Roku, TCL, Hisense, and Funai in the United States District Court, Central District of California, alleging that each of the parties is willfully infringing eight of our patents by incorporating our patented technology into certain of their televisions, set-top boxes, remote control devices, human interface devices, streaming devices, and sound bars. Each of the parties have accepted service and have not yet answered our complaint. There are no other material pending legal proceedings to which we or any of our subsidiaries is a party or of which our respective property is the subject. However, as is typical in our industry and to the nature and kind of business in which we are engaged, from time to time, various claims, charges and litigation are asserted or commenced by third parties against us or by us against third parties arising from or related to product liability, infringement of patent or other intellectual property rights, breach of warranty, contractual relations, or employee relations. The amounts claimed may be substantial but may not bear any reasonable relationship to the merits of the claims or the extent of any real risk of court awards assessed against us or in our favor. However, no assurances can be made as to the outcome of any of these matters, nor can we estimate the range of potential losses to us. In our opinion, final judgments, if any, which might be rendered against us in potential or pending litigation would not have a material adverse effect on our consolidated financial condition, results of operations, or cash flows. Moreover, we believe that our products do not infringe any third parties' patents or other intellectual property rights. We maintain directors' and officers' liability insurance which insures our individual directors and officers against certain claims, as well as attorney's fees and related expenses incurred in connection with the defense of such claims. |
Treasury Stock
Treasury Stock | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Treasury Stock | Treasury Stock From time to time, our Board of Directors authorizes management to repurchase shares of our issued and outstanding common stock. On March 10, 2020, our Board of Directors replaced the repurchase plan approved in 2018 with a new repurchase plan authorizing the repurchase of up to 300,000 of our common stock ("2020 Plan"). As of March 31, 2020 , we had 175,127 shares of common stock authorized for repurchase remaining under the 2020 Plan. We may repurchase shares of common stock in privately negotiated and/or open-market transactions, including pursuant to plans complying with Rule 10b5-1 promulgated under the Securities Exchange Act of 1934. While we have suspended repurchasing under our 2020 Plan due in part to the uncertainties surrounding the COVID-19 pandemic, management may resume such repurchasing when market and business conditions warrant. Repurchased shares of our common stock were as follows: Three Months Ended March 31, (In thousands) 2020 2019 Shares repurchased 169 43 Cost of shares repurchased $ 6,291 $ 1,215 Repurchased shares are recorded as shares held in treasury at cost. We hold these shares for future use as management and the Board of Directors deem appropriate. |
Long-lived Tangible Assets
Long-lived Tangible Assets | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Long-lived Tangible Assets | Long-lived Tangible Assets Long-lived tangible assets by geographic area, which include property, plant, and equipment, net and operating lease right-of-use assets, were as follows: (In thousands) March 31, 2020 December 31, 2019 United States $ 19,199 $ 19,938 People's Republic of China 63,160 67,625 Mexico 15,078 16,644 All other countries 6,226 6,351 Total long-lived tangible assets $ 103,663 $ 110,558 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense for each employee and director is presented in the same statement of operations caption as their cash compensation. Stock-based compensation expense by statement of operations caption and the related income tax benefit were as follows: Three Months Ended March 31, (In thousands) 2020 2019 Cost of sales $ 74 $ 28 Research and development expenses 236 220 Selling, general and administrative expenses: Employees 1,583 1,424 Outside directors 410 246 Total employee and director stock-based compensation expense $ 2,303 $ 1,918 Income tax benefit $ 506 $ 399 Stock Options Stock option activity was as follows: Number of Options (in 000's) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in 000's) Outstanding at December 31, 2019 745 $ 41.73 Granted 109 46.17 Exercised — — $ — Forfeited/canceled/expired — — Outstanding at March 31, 2020 (1) 854 $ 42.29 4.13 $ 4,070 Vested and expected to vest at March 31, 2020 (1) 854 $ 42.29 4.13 $ 4,070 Exercisable at March 31, 2020 (1) 592 $ 43.66 3.10 $ 2,933 (1) The aggregate intrinsic value represents the total pre-tax value (the difference between our closing stock price on the last trading day of the first quarter of 2020 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had they all exercised their options on March 31, 2020 . This amount will change based on the fair market value of our stock. The assumptions we utilized in the Black-Scholes option pricing model and the resulting weighted average fair value of stock option grants were the following: Three Months Ended March 31, 2020 2019 Weighted average fair value of grants $ 17.70 $ 10.28 Risk-free interest rate 1.44 % 2.49 % Expected volatility 43.95 % 41.64 % Expected life in years 4.59 4.54 As of March 31, 2020 , we expect to recognize $3.6 million of total unrecognized pre-tax stock-based compensation expense related to non-vested stock options over a remaining weighted-average life of 2.3 years . Restricted Stock Non-vested restricted stock award activity was as follows: Shares (in 000's) Weighted-Average Grant Date Fair Value Non-vested at December 31, 2019 310 $ 34.99 Granted 198 35.11 Vested (124 ) 38.17 Forfeited (1 ) 36.06 Non-vested at March 31, 2020 383 $ 34.02 As of March 31, 2020 , we expect to recognize $12.4 million of total unrecognized pre-tax stock-based compensation expense related to non-vested restricted stock awards over a weighted-average life of 2.3 years . |
Performance-Based Common Stock
Performance-Based Common Stock Warrants | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Performance-Based Common Stock Warrants | Performance-Based Common Stock Warrants On March 9, 2016, we issued common stock purchase warrants to Comcast Corporation ("Comcast") to purchase up to 725,000 shares of our common stock at a price of $54.55 per share. The right to exercise the warrants is subject to vesting over three successive two -year periods (with the first two -year period commencing on January 1, 2016) based on the level of purchases of goods and services from us by Comcast and its affiliates, as defined in the warrants. The table below presents the purchase levels and number of warrants that will vest in each period based upon achieving these purchase levels. Incremental Warrants That Will Vest Aggregate Level of Purchases by Comcast and Affiliates January 1, 2016 - December 31, 2017 January 1, 2018 - December 31, 2019 January 1, 2020 - December 31, 2021 $260 million 100,000 100,000 75,000 $300 million 75,000 75,000 75,000 $340 million 75,000 75,000 75,000 Maximum Potential Warrants Earned by Comcast 250,000 250,000 225,000 If total aggregate purchases by Comcast and its affiliates are below $260 million in any of the two -year periods above, no warrants will vest related to that two -year period. If total aggregate purchases of goods and services by Comcast and its affiliates exceed $340 million during either the first or second two -year period, the amount of any such excess will count toward aggregate purchases in the following two -year period. This threshold was not met in either the first or second two -year period. At March 31, 2020 , 275,000 vested warrants were outstanding. To fully vest in the rights to purchase all of the remaining unearned 225,000 underlying shares, Comcast and its affiliates must purchase an aggregate of $340 million in goods and services from us during the period January 1, 2020 through December 31, 2021. Any and all warrants that vest will expire on January 1, 2023. The warrants provide for certain adjustments that may be made to the exercise price and the number of shares issuable upon exercise due to customary anti-dilution provisions. Additionally, in connection with the common stock purchase warrants, we have also entered into a registration rights agreement with Comcast under which Comcast may from time to time request that we register the shares of common stock underlying vested warrants with the SEC. Because the warrants contain performance criteria under which Comcast must achieve specified aggregate purchase levels for the warrants to vest, as detailed above, for the first two -year successive periods, the measurement date for the warrants was the date on which the warrants vested. For the two -year period ended December 31, 2017, Comcast earned and vested in 175,000 out of the maximum potential 250,000 warrants. For the two -year period ended December 31, 2019, Comcast earned and vested in 100,000 out of the maximum potential 250,000 warrants. The FASB issued guidance in November 2019, which clarifies the accounting for share-based payments issued as sales incentives to customers. The guidance requires that stock-based compensation expense is recorded as a reduction in the transaction price on the basis of the grant-date fair value. The transition provisions require that equity-classified awards be measured at the adoption date fair value if the measurement date has not been established prior to the adoption date. The measurement periods for the first two successive two-year periods of our outstanding performance-based common stock warrants were completed prior to adoption and were not impacted by this updated guidance. The measurement period for the final two-year period began on January 1, 2020, and accordingly, we measured the fair value of the award as of our adoption date on January 1, 2020 using the Black-Scholes option pricing model. Through March 31, 2020 , no ne of the warrants had vested for the two -year period beginning January 1, 2020. The assumptions we utilized in the Black-Scholes option pricing model and the resulting grant-date fair value of the warrants as of January 1, 2020 were the following: Fair value $17.19 Price of Universal Electronics Inc. common stock $52.21 Risk-free interest rate 1.62% Expected volatility 48.86% Expected life in years 3.00 Prior to the adoption of the new guidance on January 1, 2020, we adjusted the estimated weighted average fair value of the warrants each period. The assumptions we utilized in the Black Scholes option pricing model and the resulting weighted average fair value of the warrants for the three months ended March 31, 2019 were the following: Fair value $9.00 Price of Universal Electronics Inc. common stock $37.46 Risk-free interest rate 2.22% Expected volatility 44.45% Expected life in years 3.75 The impact to net sales recorded in connection with the warrants and the related income tax benefit were as follows: Three Months Ended March 31, (In thousands) 2020 2019 Reduction to net sales $ 184 $ 434 Income tax benefit $ 46 $ 108 We estimate the number of warrants that will vest based on projected future purchases that will be made by Comcast and its affiliates. These estimates may increase or decrease based on actual future purchases. The aggregate estimated fair value of the warrants is recognized as a reduction to revenue over the related two-year vesting period. At March 31, 2020 , the aggregate unrecognized estimated fair value of warrants we estimate will vest was $1.1 million . |
Other Income (Expense), Net
Other Income (Expense), Net | 3 Months Ended |
Mar. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense), Net | Other Income (Expense), Net Other income (expense), net consisted of the following: Three Months Ended March 31, (In thousands) 2020 2019 Net gain (loss) on foreign currency exchange contracts (1) $ 252 $ (271 ) Net gain (loss) on foreign currency exchange transactions (548 ) (132 ) Other income (52 ) (63 ) Other (expense), net $ (348 ) $ (466 ) (1) This represents the gains (losses) incurred on foreign currency hedging derivatives (see Note 18 for further details). |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Earnings (loss) per share was calculated as follows: Three Months Ended March 31, (In thousands, except per-share amounts) 2020 2019 BASIC Net income (loss) $ 5,846 $ (1,005 ) Weighted-average common shares outstanding 13,960 13,827 Basic earnings (loss) per share $ 0.42 $ (0.07 ) DILUTED Net income (loss) $ 5,846 $ (1,005 ) Weighted-average common shares outstanding for basic 13,960 13,827 Dilutive effect of stock options, restricted stock and common stock warrants 251 — Weighted-average common shares outstanding on a diluted basis 14,211 13,827 Diluted earnings (loss) per share $ 0.41 $ (0.07 ) The following number of stock options, shares of restricted stock and common stock warrants were excluded from the computation of diluted earnings per common share as their inclusion would have been anti-dilutive: Three Months Ended March 31, (In thousands) 2020 2019 Stock options 402 543 Restricted stock awards 51 227 Performance-based warrants 275 175 |
Derivatives
Derivatives | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | Derivatives The following table sets forth the total net fair value of derivatives: March 31, 2020 December 31, 2019 Fair Value Measurement Using Total Balance Fair Value Measurement Using Total Balance (In thousands) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Foreign currency exchange contracts $ — $ (187 ) $ — $ (187 ) $ — $ (172 ) $ — $ (172 ) We held foreign currency exchange contracts, which resulted in a net pre-tax gain of $0.3 million and a net pre-tax loss of $0.3 million for the three months ended March 31, 2020 and 2019 , respectively (see Note 16). Details of foreign currency exchange contracts held were as follows: Date Held Currency Position Held Notional Value (in millions) Forward Rate Unrealized Gain/(Loss) Recorded at Balance Sheet Date (in thousands) (1) Settlement Date March 31, 2020 USD/Chinese Yuan Renminbi USD $ 30.0 7.0555 $ (146 ) April 24, 2020 March 31, 2020 USD/Euro USD $ 35.0 1.1017 $ (41 ) April 24, 2020 December 31, 2019 USD/Chinese Yuan Renminbi USD $ 35.0 6.9867 $ 100 January 23, 2020 December 31, 2019 USD/Brazilian Real USD $ 0.5 4.0560 $ (6 ) January 24, 2020 December 31, 2019 USD/Euro USD $ 28.0 1.1133 $ (253 ) January 24, 2020 December 31, 2019 USD/Brazilian Real USD $ 0.7 4.0870 $ (13 ) January 24, 2020 (1) Unrealized gains on foreign currency exchange contracts are recorded in prepaid expenses and other current assets. Unrealized losses on foreign currency exchange contracts are recorded in other accrued liabilities. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | In the opinion of management, the accompanying consolidated financial statements of Universal Electronics Inc. and its subsidiaries contain all the adjustments necessary for a fair presentation of financial position, results of operations and cash flows for the periods presented. All such adjustments are of a normal recurring nature and certain reclassifications have been made to prior year amounts in order to conform to the current year presentation. Information and footnote disclosures normally included in financial statements, which are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"), have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). As used herein, the terms "Company," "we," "us," and "our" refer to Universal Electronics Inc. and its subsidiaries, unless the context indicates to the contrary. |
Estimates, Judgments and Assumptions | The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, we evaluate our estimates and assumptions, including those related to revenue recognition, allowances for bad debts, inventory valuation, our review for impairment of long-lived assets, intangible assets and goodwill, business combinations, income taxes, stock-based compensation expense and performance-based common stock warrants. |
Recently Adopted Accounting Pronouncements and Recent Accounting Updates Note Yet Effective | Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, "Measurement of Credit Losses on Financial Instruments", which updates existing guidance for measuring and recording credit losses on financial assets measured at amortized cost by replacing the incurred loss impairment model with an expected loss impairment model. Accordingly, financial assets are presented at amortized costs net of an allowance for expected credit losses over the lifetime of the assets. We adopted this new guidance on January 1, 2020 using the modified retrospective method. The adoption did not require an implementation adjustment and did not materially impact our consolidated statement of financial position, results of operations and cash flows. See Note 3 for further discussion on our allowance for bad debts. In January 2017, the FASB issued ASU 2017-04, "Simplifying the Test for Goodwill Impairment", which simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to the reporting unit. Our adoption on January 1, 2020 did not have a material impact on our consolidated statement of financial position, results of operations and cash flows. In November 2019, the FASB issued ASU 2019-08, "Improvements - Share-based Consideration Payable to a Customer", which clarifies the accounting for share-based payments issued as sales incentives to customers. The guidance requires that stock-based compensation expense is recorded as a reduction in the transaction price on the basis of the grant-date fair value. The grant-date fair value is calculated using the provisions defined under Accounting Standards Codification "Stock Compensation". The transition provisions require that equity-classified awards be measured at the adoption date fair value if the measurement date has not been established prior to the adoption date. This guidance impacts the measurement date of our performance-based common stock warrants. The measurement periods for the first two successive two-year periods of our outstanding performance-based common stock warrants were completed prior to adoption and were not impacted by this updated guidance. The measurement period for the final two-year period began on January 1, 2020, and accordingly, we measured the fair value of the award as of our adoption date on January 1, 2020. We adopted this guidance using the modified retrospective method. Our adoption did not result in a cumulative adjustment in our statement of financial position. See Note 15 for further discussion on the performance-based common stock warrants. Recent Accounting Updates Not Yet Effective In December 2019, the FASB issued ASU 2019-12 "Simplifying the Accounting for Income Taxes", which among other provisions, eliminates certain exceptions to existing guidance related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. This guidance also requires an entity to reflect the effect of an enacted change in tax laws or rates in its effective income tax rate in the first interim period that includes the enactment date of the new legislation, aligning the timing of recognition of the effects from enacted tax law changes on the effective income tax rate with the effects on deferred income tax assets and liabilities. Under existing guidance, an entity recognizes the effects of the enacted tax law change on the effective income tax rate in the period that includes the effective date of the tax law. The guidance is effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. We are currently evaluating the impact of this guidance on our consolidated statement of financial position, results of operations and cash flows. |
Cash and Cash Equivalents (Tabl
Cash and Cash Equivalents (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents by Geographic Region | Cash and cash equivalents were held in the following geographic regions: (In thousands) March 31, 2020 December 31, 2019 United States $ 10,421 $ 16,751 People's Republic of China ("PRC") 14,105 13,700 Asia (excluding the PRC) 11,052 21,691 Europe 12,810 9,081 South America 10,539 13,079 Total cash and cash equivalents $ 58,927 $ 74,302 |
Revenue and Accounts Receivab_2
Revenue and Accounts Receivable, Net (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Receivables [Abstract] | |
Pattern of Revenue Recognition | The pattern of revenue recognition was as follows: Three Months Ended March 31, (In thousands) 2020 2019 Goods and services transferred at a point in time $ 117,058 $ 136,338 Goods and services transferred over time 34,720 47,825 Net sales $ 151,778 $ 184,163 |
Revenue from External Customers by Geographic Areas | Our net sales to external customers by geographic area were as follows: Three Months Ended March 31, (In thousands) 2020 2019 United States $ 74,381 $ 98,936 Asia (excluding PRC) 27,825 24,076 Europe 20,502 23,299 People's Republic of China 17,517 22,308 Latin America 4,640 7,787 Other 6,913 7,757 Total net sales $ 151,778 $ 184,163 |
Net Sales to Significant Customers | Net sales to the following customers totaled more than 10% of our net sales: Three Months Ended March 31, 2020 2019 $ (thousands) % of Net Sales $ (thousands) % of Net Sales Comcast Corporation $ 32,935 21.7 % $ 29,246 15.9 % DISH Network Corporation — (1) — (1) $ 19,678 10.7 % (1) Sales associated with this customer did not total more than 10% of our net sales for the indicated period. |
Accounts Receivable, Net and Changes in the Allowance for Doubtful Accounts | Changes in the allowance for bad debts were as follows: (In thousands) Three Months Ended March 31, 2020 2019 Balance at beginning of period $ 1,492 $ 1,121 Additions to costs and expenses 237 3 (Write-offs)/Foreign exchange effects (48 ) (4 ) Balance at end of period $ 1,681 $ 1,120 Accounts receivable, net were as follows: (In thousands) March 31, 2020 December 31, 2019 Trade receivables, gross $ 129,316 $ 130,888 Allowance for bad debts (1,681 ) (1,492 ) Allowance for sales returns (495 ) (623 ) Net trade receivables 127,140 128,773 Other 9,954 10,425 Accounts receivable, net $ 137,094 $ 139,198 |
Trade Receivables Associated with Significant Customers | Trade receivables associated with these significant customers that totaled more than 10% of our accounts receivable, net were as follows: March 31, 2020 December 31, 2019 $ (thousands) % of Accounts Receivable, Net $ (thousands) % of Accounts Receivable, Net Comcast Corporation $ 28,423 20.7 % — (1) — (1) DISH Network Corporation — (1) — (1) $ 14,677 10.5 % (1) Trade receivables associated with this customer did not total more than 10% of our accounts receivable, net for the indicated period. |
Inventories and Significant S_2
Inventories and Significant Suppliers (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | Inventories were as follows: (In thousands) March 31, 2020 December 31, 2019 Raw materials $ 59,409 $ 56,352 Components 18,925 24,599 Work in process 5,240 1,526 Finished goods 58,669 62,658 Inventories $ 142,243 $ 145,135 |
Purchases from Significant Suppliers | Purchases from the following supplier totaled more than 10% of our total inventory purchases: Three Months Ended March 31, 2020 2019 $ (thousands) % of Total Inventory Purchases $ (thousands) % of Total Inventory Purchases Qorvo International Pte Ltd. $ 11,177 14.0 % — (1) — (1) (1) Purchases associated with this supplier did not total more than 10% of our total inventory purchases for the indicated period. The supplier that totaled more than 10% of our accounts payable, was as follows: March 31, 2020 December 31, 2019 $ (thousands) % of Accounts Payable $ (thousands) % of Accounts Payable Zhejiang Zhen You Electronics Co. Ltd. $ 9,330 10.4 % $ 11,394 11.1 % |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Lease Balances within the Consolidated Balance Sheet | Lease balances within our consolidated balance sheet were as follows: (In thousands) March 31, 2020 December 31, 2019 Assets: Operating lease right-of-use assets $ 18,359 $ 19,826 Liabilities: Other accrued liabilities $ 5,030 $ 4,903 Long-term operating lease obligations 14,069 15,639 Total lease liabilities $ 19,099 $ 20,542 |
Operating Lease Expense, Operating Lease Cash Flows and Supplemental Cash Flow Information | Operating lease expense, including variable and short-term lease costs which were insignificant to the total, operating lease cash flows and supplemental cash flow information were as follows: (In thousands) Three Months Ended March 31, 2020 2019 Cost of sales $ 390 $ 592 Selling, general and administrative expenses 998 1,384 Total operating lease expense $ 1,388 $ 1,976 Operating cash outflows from operating leases $ 1,525 $ 1,767 Operating lease right-of-use assets obtained in exchange for lease obligations $ 186 $ 1,524 |
Lease Terms and Discount Rates | The weighted average remaining lease liability term and the weighted average discount rate were as follows: March 31, 2020 Weighted average lease liability term (in years) 4.10 Weighted average discount rate 4.51 % |
Reconciliation of the Undiscounted Cash Flows for Each of the First Five Years and Thereafter to Operating Lease Liabilities | The following table reconciles the undiscounted cash flows for each of the first five years and thereafter to the operating lease liabilities recognized in our consolidated balance sheet at March 31, 2020 . The reconciliation excludes short-term leases that are not recorded on the balance sheet. (In thousands) March 31, 2020 2020 (remaining 9 months) $ 4,419 2021 6,256 2022 5,250 2023 2,399 2024 1,343 Thereafter 2,040 Total lease payments 21,707 Less: imputed interest (2,608 ) Total lease liabilities $ 19,099 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets, Net (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the Carrying Amount of Goodwill | Changes in the carrying amount of goodwill were as follows: (In thousands) Balance at December 31, 2019 $ 48,447 Foreign exchange effects (31 ) Balance at March 31, 2020 $ 48,416 |
Components of Intangible Assets, Net | The components of intangible assets, net were as follows: March 31, 2020 December 31, 2019 (In thousands) Gross (1) Accumulated Amortization (1) Net Gross (1) Accumulated Amortization (1) Net Distribution rights $ 316 $ (213 ) $ 103 $ 322 $ (210 ) $ 112 Patents 17,625 (6,705 ) 10,920 16,587 (6,491 ) 10,096 Trademarks and trade names 2,786 (2,282 ) 504 2,785 (2,205 ) 580 Developed and core technology 12,480 (10,515 ) 1,965 12,480 (10,016 ) 2,464 Capitalized software development costs 33 — 33 — — — Customer relationships 32,534 (26,775 ) 5,759 32,534 (25,956 ) 6,578 Total intangible assets, net $ 65,774 $ (46,490 ) $ 19,284 $ 64,708 $ (44,878 ) $ 19,830 (1) This table excludes the gross value of fully amortized intangible assets totaling $7.6 million and $7.4 million at March 31, 2020 and December 31, 2019 , respectively. |
Estimated Future Amortization Expense Related to Intangible Assets | Estimated future annual amortization expense related to our intangible assets at March 31, 2020 , was as follows: (In thousands) 2020 (remaining 9 months) $ 4,333 2021 2,573 2022 2,575 2023 2,396 2024 1,817 Thereafter 5,590 Total $ 19,284 |
Accrued Compensation (Tables)
Accrued Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Payables and Accruals [Abstract] | |
Components of Accrued Compensation | The components of accrued compensation were as follows: (In thousands) March 31, 2020 December 31, 2019 Accrued social insurance (1) $ 16,479 $ 16,588 Accrued salary/wages 7,181 7,465 Accrued vacation/holiday 2,936 2,766 Accrued bonus 3,200 13,965 Accrued commission 271 1,283 Other accrued compensation 1,770 1,601 Total accrued compensation $ 31,837 $ 43,668 (1) PRC employers are required by law to remit the applicable social insurance payments to their local government. Social insurance is comprised of various components such as pension, medical insurance, job industry insurance, unemployment insurance, and a housing assistance fund, and is administered in a manner similar to social security in the United States. This amount represents our estimate of the amounts due to the PRC government for social insurance on March 31, 2020 and December 31, 2019 . The components of other accrued liabilities were as follows: (In thousands) March 31, 2020 December 31, 2019 Contract liabilities $ 1,694 $ 1,840 Duties 3,585 3,731 Freight and handling fees 3,251 3,769 Operating lease obligations 5,030 4,903 Product warranty claim costs 1,498 1,514 Professional fees 3,232 2,833 Sales taxes and VAT 2,829 3,926 Short-term contingent consideration 3,300 5,428 Other 6,662 7,501 Total other accrued liabilities $ 31,081 $ 35,445 |
Other Accrued Liabilities (Tabl
Other Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Payables and Accruals [Abstract] | |
Components of Other Accrued Liabilities | The components of accrued compensation were as follows: (In thousands) March 31, 2020 December 31, 2019 Accrued social insurance (1) $ 16,479 $ 16,588 Accrued salary/wages 7,181 7,465 Accrued vacation/holiday 2,936 2,766 Accrued bonus 3,200 13,965 Accrued commission 271 1,283 Other accrued compensation 1,770 1,601 Total accrued compensation $ 31,837 $ 43,668 (1) PRC employers are required by law to remit the applicable social insurance payments to their local government. Social insurance is comprised of various components such as pension, medical insurance, job industry insurance, unemployment insurance, and a housing assistance fund, and is administered in a manner similar to social security in the United States. This amount represents our estimate of the amounts due to the PRC government for social insurance on March 31, 2020 and December 31, 2019 . The components of other accrued liabilities were as follows: (In thousands) March 31, 2020 December 31, 2019 Contract liabilities $ 1,694 $ 1,840 Duties 3,585 3,731 Freight and handling fees 3,251 3,769 Operating lease obligations 5,030 4,903 Product warranty claim costs 1,498 1,514 Professional fees 3,232 2,833 Sales taxes and VAT 2,829 3,926 Short-term contingent consideration 3,300 5,428 Other 6,662 7,501 Total other accrued liabilities $ 31,081 $ 35,445 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Changes in the Liability for Product Warranty Claim Costs | Changes in the liability for product warranty claim costs were as follows: (In thousands) Three Months Ended March 31, 2020 2019 Balance at beginning of period $ 1,514 $ 276 Accruals for warranties issued during the period — — Settlements (in cash or in kind) during the period/Foreign exchange effects (16 ) — Balance at end of period $ 1,498 $ 276 |
Treasury Stock (Tables)
Treasury Stock (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Repurchased Shares of Common Stock | Repurchased shares of our common stock were as follows: Three Months Ended March 31, (In thousands) 2020 2019 Shares repurchased 169 43 Cost of shares repurchased $ 6,291 $ 1,215 |
Long-lived Tangible Assets (Tab
Long-lived Tangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Long-Lived Tangible Assets by Geographic Area | Long-lived tangible assets by geographic area, which include property, plant, and equipment, net and operating lease right-of-use assets, were as follows: (In thousands) March 31, 2020 December 31, 2019 United States $ 19,199 $ 19,938 People's Republic of China 63,160 67,625 Mexico 15,078 16,644 All other countries 6,226 6,351 Total long-lived tangible assets $ 103,663 $ 110,558 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-based Compensation Expense and Related Income Tax Benefit | Stock-based compensation expense by statement of operations caption and the related income tax benefit were as follows: Three Months Ended March 31, (In thousands) 2020 2019 Cost of sales $ 74 $ 28 Research and development expenses 236 220 Selling, general and administrative expenses: Employees 1,583 1,424 Outside directors 410 246 Total employee and director stock-based compensation expense $ 2,303 $ 1,918 Income tax benefit $ 506 $ 399 |
Stock Option Activity | Stock option activity was as follows: Number of Options (in 000's) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in 000's) Outstanding at December 31, 2019 745 $ 41.73 Granted 109 46.17 Exercised — — $ — Forfeited/canceled/expired — — Outstanding at March 31, 2020 (1) 854 $ 42.29 4.13 $ 4,070 Vested and expected to vest at March 31, 2020 (1) 854 $ 42.29 4.13 $ 4,070 Exercisable at March 31, 2020 (1) 592 $ 43.66 3.10 $ 2,933 (1) The aggregate intrinsic value represents the total pre-tax value (the difference between our closing stock price on the last trading day of the first quarter of 2020 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had they all exercised their options on March 31, 2020 . This amount will change based on the fair market value of our stock. |
Assumptions Used in Valuation and Weighted Average Fair Value of Stock Option Grants | The assumptions we utilized in the Black-Scholes option pricing model and the resulting weighted average fair value of stock option grants were the following: Three Months Ended March 31, 2020 2019 Weighted average fair value of grants $ 17.70 $ 10.28 Risk-free interest rate 1.44 % 2.49 % Expected volatility 43.95 % 41.64 % Expected life in years 4.59 4.54 |
Non-Vested Restricted Stock Award Activity | Non-vested restricted stock award activity was as follows: Shares (in 000's) Weighted-Average Grant Date Fair Value Non-vested at December 31, 2019 310 $ 34.99 Granted 198 35.11 Vested (124 ) 38.17 Forfeited (1 ) 36.06 Non-vested at March 31, 2020 383 $ 34.02 |
Performance-Based Common Stoc_2
Performance-Based Common Stock Warrants (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Purchase Level and Number of Warrants That Will Vest | The table below presents the purchase levels and number of warrants that will vest in each period based upon achieving these purchase levels. Incremental Warrants That Will Vest Aggregate Level of Purchases by Comcast and Affiliates January 1, 2016 - December 31, 2017 January 1, 2018 - December 31, 2019 January 1, 2020 - December 31, 2021 $260 million 100,000 100,000 75,000 $300 million 75,000 75,000 75,000 $340 million 75,000 75,000 75,000 Maximum Potential Warrants Earned by Comcast 250,000 250,000 225,000 |
Assumptions Used in Valuation and Weighted Average Fair Value of Warrants | The assumptions we utilized in the Black-Scholes option pricing model and the resulting grant-date fair value of the warrants as of January 1, 2020 were the following: Fair value $17.19 Price of Universal Electronics Inc. common stock $52.21 Risk-free interest rate 1.62% Expected volatility 48.86% Expected life in years 3.00 Prior to the adoption of the new guidance on January 1, 2020, we adjusted the estimated weighted average fair value of the warrants each period. The assumptions we utilized in the Black Scholes option pricing model and the resulting weighted average fair value of the warrants for the three months ended March 31, 2019 were the following: Fair value $9.00 Price of Universal Electronics Inc. common stock $37.46 Risk-free interest rate 2.22% Expected volatility 44.45% Expected life in years 3.75 |
Impact to Net Sales in Connection with Warrants and Related Income Tax Benefit | The impact to net sales recorded in connection with the warrants and the related income tax benefit were as follows: Three Months Ended March 31, (In thousands) 2020 2019 Reduction to net sales $ 184 $ 434 Income tax benefit $ 46 $ 108 |
Other Income (Expense), Net (Ta
Other Income (Expense), Net (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense), Net | Other income (expense), net consisted of the following: Three Months Ended March 31, (In thousands) 2020 2019 Net gain (loss) on foreign currency exchange contracts (1) $ 252 $ (271 ) Net gain (loss) on foreign currency exchange transactions (548 ) (132 ) Other income (52 ) (63 ) Other (expense), net $ (348 ) $ (466 ) (1) This represents the gains (losses) incurred on foreign currency hedging derivatives (see Note 18 for further details). |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Calculation of Earnings Per Share | Earnings (loss) per share was calculated as follows: Three Months Ended March 31, (In thousands, except per-share amounts) 2020 2019 BASIC Net income (loss) $ 5,846 $ (1,005 ) Weighted-average common shares outstanding 13,960 13,827 Basic earnings (loss) per share $ 0.42 $ (0.07 ) DILUTED Net income (loss) $ 5,846 $ (1,005 ) Weighted-average common shares outstanding for basic 13,960 13,827 Dilutive effect of stock options, restricted stock and common stock warrants 251 — Weighted-average common shares outstanding on a diluted basis 14,211 13,827 Diluted earnings (loss) per share $ 0.41 $ (0.07 ) |
Securities Excluded from the Computation of Diluted Earnings (Loss) Per Common Share | The following number of stock options, shares of restricted stock and common stock warrants were excluded from the computation of diluted earnings per common share as their inclusion would have been anti-dilutive: Three Months Ended March 31, (In thousands) 2020 2019 Stock options 402 543 Restricted stock awards 51 227 Performance-based warrants 275 175 |
Derivatives (Tables)
Derivatives (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Total Net Fair Value of Derivatives | The following table sets forth the total net fair value of derivatives: March 31, 2020 December 31, 2019 Fair Value Measurement Using Total Balance Fair Value Measurement Using Total Balance (In thousands) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Foreign currency exchange contracts $ — $ (187 ) $ — $ (187 ) $ — $ (172 ) $ — $ (172 ) |
Foreign Currency Exchange Contracts | Details of foreign currency exchange contracts held were as follows: Date Held Currency Position Held Notional Value (in millions) Forward Rate Unrealized Gain/(Loss) Recorded at Balance Sheet Date (in thousands) (1) Settlement Date March 31, 2020 USD/Chinese Yuan Renminbi USD $ 30.0 7.0555 $ (146 ) April 24, 2020 March 31, 2020 USD/Euro USD $ 35.0 1.1017 $ (41 ) April 24, 2020 December 31, 2019 USD/Chinese Yuan Renminbi USD $ 35.0 6.9867 $ 100 January 23, 2020 December 31, 2019 USD/Brazilian Real USD $ 0.5 4.0560 $ (6 ) January 24, 2020 December 31, 2019 USD/Euro USD $ 28.0 1.1133 $ (253 ) January 24, 2020 December 31, 2019 USD/Brazilian Real USD $ 0.7 4.0870 $ (13 ) January 24, 2020 (1) Unrealized gains on foreign currency exchange contracts are recorded in prepaid expenses and other current assets. Unrealized losses on foreign currency exchange contracts are recorded in other accrued liabilities. |
Cash and Cash Equivalents (Deta
Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Cash and Cash Equivalents [Line Items] | ||
Cash and cash equivalents | $ 58,927 | $ 74,302 |
United States | ||
Cash and Cash Equivalents [Line Items] | ||
Cash and cash equivalents | 10,421 | 16,751 |
People's Republic of China (PRC) | ||
Cash and Cash Equivalents [Line Items] | ||
Cash and cash equivalents | 14,105 | 13,700 |
Asia (excluding the PRC) | ||
Cash and Cash Equivalents [Line Items] | ||
Cash and cash equivalents | 11,052 | 21,691 |
Europe | ||
Cash and Cash Equivalents [Line Items] | ||
Cash and cash equivalents | 12,810 | 9,081 |
South America | ||
Cash and Cash Equivalents [Line Items] | ||
Cash and cash equivalents | $ 10,539 | $ 13,079 |
Revenue and Accounts Receivab_3
Revenue and Accounts Receivable, Net - Pattern of Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenues, net | $ 151,778 | $ 184,163 |
Goods and services transferred at a point in time | ||
Disaggregation of Revenue [Line Items] | ||
Revenues, net | 117,058 | 136,338 |
Goods and services transferred over time | ||
Disaggregation of Revenue [Line Items] | ||
Revenues, net | $ 34,720 | $ 47,825 |
Revenue and Accounts Receivab_4
Revenue and Accounts Receivable, Net - Revenue from External Customers by Geographic Areas (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 151,778 | $ 184,163 |
United States | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 74,381 | 98,936 |
Asia (excluding the PRC) | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 27,825 | 24,076 |
Europe | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 20,502 | 23,299 |
People's Republic of China (PRC) | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 17,517 | 22,308 |
Latin America | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 4,640 | 7,787 |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 6,913 | $ 7,757 |
Revenue and Accounts Receivab_5
Revenue and Accounts Receivable, Net - Net Sales to Significant Customers (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 151,778 | $ 184,163 |
Comcast Corporation | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 32,935 | 29,246 |
DISH Network Corporation | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 19,678 | |
Customer Concentration Risk | Comcast Corporation | Net Sales | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk percentage | 21.70% | 15.90% |
Customer Concentration Risk | DISH Network Corporation | Net Sales | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk percentage | 10.70% |
Revenue and Accounts Receivab_6
Revenue and Accounts Receivable, Net - Accounts Receivable, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract] | ||||
Trade receivables, gross | $ 129,316 | $ 130,888 | ||
Allowance for bad debts | (1,681) | (1,492) | $ (1,120) | $ (1,121) |
Allowance for sales returns | (495) | (623) | ||
Net trade receivables | 127,140 | 128,773 | ||
Other | 9,954 | 10,425 | ||
Accounts receivable, net | $ 137,094 | $ 139,198 |
Revenue and Accounts Receivab_7
Revenue and Accounts Receivable, Net - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Schedule of Allowance for Doubtful Accounts | ||
Balance at beginning of period | $ 1,492 | $ 1,121 |
Additions to costs and expenses | 237 | 3 |
(Write-offs)/Foreign exchange effects | (48) | (4) |
Balance at end of period | $ 1,681 | $ 1,120 |
Revenue and Accounts Receivab_8
Revenue and Accounts Receivable, Net - Trade Receivables Associated with Significant Customers (Details) - Trade Accounts Receivable - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Comcast Corporation | ||
Revenue, Major Customer [Line Items] | ||
Accounts receivable, net | $ 28,423 | $ 0 |
Concentration risk percentage | 20.70% | 0.00% |
DISH Network Corporation | ||
Revenue, Major Customer [Line Items] | ||
Accounts receivable, net | $ 0 | $ 14,677 |
Concentration risk percentage | 0.00% | 10.50% |
Inventories and Significant S_3
Inventories and Significant Suppliers - Summary of Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 59,409 | $ 56,352 |
Components | 18,925 | 24,599 |
Work in process | 5,240 | 1,526 |
Finished goods | 58,669 | 62,658 |
Inventories | $ 142,243 | $ 145,135 |
Inventories and Significant S_4
Inventories and Significant Suppliers - Purchases from Significant Suppliers (Details) - Supplier Concentration Risk - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Inventory Purchases | |||
Concentration Risk [Line Items] | |||
Inventory purchases | $ 11,177 | $ 0 | |
Concentration risk percentage | 14.00% | 0.00% | |
Accounts Payable | |||
Concentration Risk [Line Items] | |||
Inventory purchases | $ 9,330 | $ 11,394 | |
Concentration risk percentage | 10.40% | 11.10% |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($)lease | |
Leases [Abstract] | |
Remaining lease terms (up to) | 41 years |
Number of operating leases not yet commenced | lease | 1 |
Initial lease liability of operating leases that have not yet commenced | $ | $ 1.6 |
Term of operating lease that has not yet commenced | 5 years |
Leases - Lease Balances within
Leases - Lease Balances within the Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Assets: | ||
Operating lease right-of-use assets | $ 18,359 | $ 19,826 |
Liabilities: | ||
Other accrued liabilities | 5,030 | 4,903 |
Long-term operating lease obligations | 14,069 | 15,639 |
Total lease liabilities | $ 19,099 | $ 20,542 |
Leases - Operating Lease Expens
Leases - Operating Lease Expense, Operating Lease Cash Flows and Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Lessee, Lease, Description [Line Items] | ||
Operating lease expense | $ 1,388 | $ 1,976 |
Operating cash outflows from operating leases | 1,525 | 1,767 |
Operating lease right-of-use assets obtained in exchange for lease obligations | 186 | 1,524 |
Cost of sales | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease expense | 390 | 592 |
Selling, general and administrative expenses | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease expense | $ 998 | $ 1,384 |
Leases - Lease Terms and Discou
Leases - Lease Terms and Discount Rates (Details) | Mar. 31, 2020 |
Leases [Abstract] | |
Weighted average lease term | 4 years 1 month 6 days |
Weighted average discount rate | 4.51% |
Leases - Reconciliation of the
Leases - Reconciliation of the Undiscounted Cash Flows for Each of the First Five Years and Thereafter to Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
2020 (remaining 9 months) | $ 4,419 | |
2021 | 6,256 | |
2022 | 5,250 | |
2023 | 2,399 | |
2024 | 1,343 | |
Thereafter | 2,040 | |
Total lease payments | 21,707 | |
Less: imputed interest | (2,608) | |
Total lease liabilities | $ 19,099 | $ 20,542 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets, Net - Changes in the Carrying Amount of Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Goodwill [Roll Forward] | |
Balance | $ 48,447 |
Foreign exchange effects | (31) |
Balance | $ 48,416 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets, Net - Components of Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross | $ 65,774 | $ 64,708 |
Accumulated Amortization | (46,490) | (44,878) |
Net | 19,284 | 19,830 |
Gross value of fully amortized intangible assets | 7,600 | 7,400 |
Distribution rights | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross | 316 | 322 |
Accumulated Amortization | (213) | (210) |
Net | 103 | 112 |
Patents | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross | 17,625 | 16,587 |
Accumulated Amortization | (6,705) | (6,491) |
Net | 10,920 | 10,096 |
Trademarks and trade names | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross | 2,786 | 2,785 |
Accumulated Amortization | (2,282) | (2,205) |
Net | 504 | 580 |
Developed and core technology | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross | 12,480 | 12,480 |
Accumulated Amortization | (10,515) | (10,016) |
Net | 1,965 | 2,464 |
Capitalized software development costs | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross | 33 | 0 |
Accumulated Amortization | 0 | 0 |
Net | 33 | 0 |
Customer relationships | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross | 32,534 | 32,534 |
Accumulated Amortization | (26,775) | (25,956) |
Net | $ 5,759 | $ 6,578 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets, Net - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Selling, General and Administrative Expenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization expense | $ 1.8 | $ 1.8 |
Goodwill and Intangible Asset_6
Goodwill and Intangible Assets, Net - Estimated Future Annual Amortization Expense Related to Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Schedule of Estimated Future Amortization expense | ||
2020 (remaining 9 months) | $ 4,333 | |
2021 | 2,573 | |
2022 | 2,575 | |
2023 | 2,396 | |
2024 | 1,817 | |
Thereafter | 5,590 | |
Net | $ 19,284 | $ 19,830 |
Line of Credit (Details)
Line of Credit (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Line of Credit Facility [Line Items] | |||
Amount outstanding under line of credit | $ 78,000,000 | $ 68,000,000 | |
Interest expense on borrowings | $ 700,000 | $ 1,300,000 | |
Line of Credit | US Bank | |||
Line of Credit Facility [Line Items] | |||
Effective interest rate | 2.20% | ||
Line of Credit | US Bank | LIBOR | Minimum | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 1.25% | ||
Line of Credit | US Bank | LIBOR | Maximum | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 1.75% | ||
Line of Credit | US Bank | Base Rate | Minimum | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 0.00% | ||
Line of Credit | US Bank | Base Rate | Maximum | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
Line of Credit | US Bank | Enson | |||
Line of Credit Facility [Line Items] | |||
Ownership interest used to secure obligations | 65.00% | ||
Line of Credit | Second Amended Credit Agreement | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 125,000,000 | ||
Commitment fees | 0 | ||
Letter of Credit | |||
Line of Credit Facility [Line Items] | |||
Letter of credit outstanding amount | $ 2,700,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Income tax expense | $ 1,220 | $ 996 | |
Unrecognized tax benefits | 4,300 | ||
Unrecognized tax benefits that would impact effective rate | 4,300 | ||
Anticipated decrease in unrecognized tax benefits | 200 | ||
Accrued interest and penalties | $ 200 | $ 200 |
Accrued Compensation (Details)
Accrued Compensation (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Components of Accrued Compensation | ||
Accrued social insurance | $ 16,479 | $ 16,588 |
Accrued salary/wages | 7,181 | 7,465 |
Accrued vacation/holiday | 2,936 | 2,766 |
Accrued bonus | 3,200 | 13,965 |
Accrued commission | 271 | 1,283 |
Other accrued compensation | 1,770 | 1,601 |
Total accrued compensation | $ 31,837 | $ 43,668 |
Other Accrued Liabilities (Deta
Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||
Contract liabilities | $ 1,694 | $ 1,840 |
Duties | 3,585 | 3,731 |
Freight and handling fees | 3,251 | 3,769 |
Operating lease obligations | 5,030 | 4,903 |
Product warranty claim costs | 1,498 | 1,514 |
Professional fees | 3,232 | 2,833 |
Sales taxes and VAT | 2,829 | 3,926 |
Short-term contingent consideration | 3,300 | 5,428 |
Other | 6,662 | 7,501 |
Total other accrued liabilities | $ 31,081 | $ 35,445 |
Commitments and Contingencies -
Commitments and Contingencies - Changes in the Liability for Product Warranty Claim Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Schedule of Changes in Reserve for Product Warranty Claim Costs | ||
Balance at beginning of period | $ 1,514 | $ 276 |
Accruals for warranties issued during the period | 0 | 0 |
Settlements (in cash or in kind) during the period/Foreign exchange effects | (16) | 0 |
Balance at end of period | $ 1,498 | $ 276 |
Commitments and Contingencies_2
Commitments and Contingencies - Narrative (Details) - Pending Litigation | Apr. 09, 2020patent | Sep. 05, 2018patent | Jun. 10, 2015productsubsidiarypatentcustomer | Sep. 30, 2015patent |
UEBV Lawsuit | ||||
Contingencies [Line Items] | ||||
Number of subsidiaries named in lawsuit | subsidiary | 1 | |||
Number of customers named in lawsuit | customer | 1 | |||
UEBV Lawsuit | Design Patents | ||||
Contingencies [Line Items] | ||||
Number of products named in lawsuit | product | 1 | |||
Number of patents allegedly infringed upon | 2 | |||
UEBV Lawsuit | Utility Patents | ||||
Contingencies [Line Items] | ||||
Number of patents allegedly infringed upon | 1 | 1 | ||
Roku Lawsuit | Utility Patents | ||||
Contingencies [Line Items] | ||||
Number of patents allegedly infringed upon | 9 | |||
Subsequent Event | Roku, TCL, Hisense, and Funai Patent Infringement - ITC Matter | ||||
Contingencies [Line Items] | ||||
Number of patents allegedly infringed upon | 8 |
Treasury Stock - Narrative (Det
Treasury Stock - Narrative (Details) - shares | Mar. 31, 2020 | Mar. 10, 2020 |
Equity, Class of Treasury Stock [Line Items] | ||
Remaining common stock authorized for repurchase (in shares) | 175,127 | |
Share Repurchase Program Authorized March 10 2020 | ||
Equity, Class of Treasury Stock [Line Items] | ||
Repurchase of common stock (in shares) | 300,000 |
Treasury Stock - Repurchased Sh
Treasury Stock - Repurchased Shares of Common Stock (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Equity [Abstract] | ||
Shares repurchased (in shares) | 169 | 43 |
Cost of shares repurchased | $ 6,291 | $ 1,215 |
Long-lived Tangible Assets - Lo
Long-lived Tangible Assets - Long-Lived Tangible Assets by Geographic Area (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Long-lived Assets from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived tangible assets | $ 103,663 | $ 110,558 |
United States | ||
Long-lived Assets from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived tangible assets | 19,199 | 19,938 |
People's Republic of China (PRC) | ||
Long-lived Assets from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived tangible assets | 63,160 | 67,625 |
Mexico | ||
Long-lived Assets from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived tangible assets | 15,078 | 16,644 |
All other countries | ||
Long-lived Assets from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived tangible assets | $ 6,226 | $ 6,351 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock-based Compensation Expense and Related Income Tax Benefit (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Employee and director stock-based compensation expense | $ 2,303 | $ 1,918 |
Income tax benefit | 506 | 399 |
Cost of sales | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Employee and director stock-based compensation expense | 74 | 28 |
Research and development expenses | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Employee and director stock-based compensation expense | 236 | 220 |
Selling, general and administrative expenses | Employees | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Employee and director stock-based compensation expense | 1,583 | 1,424 |
Selling, general and administrative expenses | Outside directors | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Employee and director stock-based compensation expense | $ 410 | $ 246 |
Stock-Based Compensation - St_2
Stock-Based Compensation - Stock Option Activity (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($)$ / sharesshares | |
Number of Options | |
Outstanding at beginning of period (in shares) | shares | 745 |
Granted (in shares) | shares | 109 |
Exercised (in shares) | shares | 0 |
Forfeited/canceled/expired (in shares) | shares | 0 |
Outstanding at end of period (in shares) | shares | 854 |
Vested and expected to vest at end of period (in shares) | shares | 854 |
Exercisable at end of period (in shares) | shares | 592 |
Weighted-Average Exercise Price | |
Outstanding at beginning of period (in dollars per share) | $ / shares | $ 41.73 |
Granted (in dollars per share) | $ / shares | 46.17 |
Exercised (in dollars per share) | $ / shares | 0 |
Forfeited/canceled/expired (in dollars per share) | $ / shares | 0 |
Outstanding at end of period (in dollars per share) | $ / shares | 42.29 |
Vested and expected to vest at end of period (in dollars per share) | $ / shares | 42.29 |
Exercisable at end of period (in dollars per share) | $ / shares | $ 43.66 |
Weighted-Average Remaining Contractual Term (in years) | |
Outstanding at end of period | 4 years 1 month 17 days |
Vested and expected to vest at end of period | 4 years 1 month 17 days |
Exercisable at end of period | 3 years 1 month 6 days |
Aggregate Intrinsic Value | |
Exercised | $ | $ 0 |
Outstanding at end of period | $ | 4,070 |
Vested and expected to vest at end of period | $ | 4,070 |
Exercisable at end of period | $ | $ 2,933 |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions Used in Valuation and Weighted Average Fair Value of Stock Option Grants (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | ||
Weighted average fair value of grants (in dollars per share) | $ 17.70 | $ 10.28 |
Risk-free interest rate | 1.44% | 2.49% |
Expected volatility | 43.95% | 41.64% |
Expected life | 4 years 7 months 2 days | 4 years 6 months 15 days |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized pre-tax stock-based compensation expense | $ 3.6 |
Unrecognized pre-tax stock-based compensation expense, remaining weighted-average life | 2 years 3 months 18 days |
Restricted Stock Awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized pre-tax stock-based compensation expense | $ 12.4 |
Unrecognized pre-tax stock-based compensation expense, remaining weighted-average life | 2 years 3 months 18 days |
Stock-Based Compensation - Non-
Stock-Based Compensation - Non-Vested Restricted Stock Award Activity (Details) shares in Thousands | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Shares | |
Non-vested at beginning of period (in shares) | shares | 310 |
Granted (in shares) | shares | 198 |
Vested (in shares) | shares | (124) |
Forfeited (in shares) | shares | (1) |
Non-vested at end of period (in shares) | shares | 383 |
Weighted-Average Grant Date Fair Value | |
Non-vested at beginning of period (in dollars per share) | $ / shares | $ 34.99 |
Granted (in dollars per share) | $ / shares | 35.11 |
Vested (in dollars per share) | $ / shares | 38.17 |
Forfeited (in dollars per share) | $ / shares | 36.06 |
Non-vested at end of period (in dollars per share) | $ / shares | $ 34.02 |
Performance-Based Common Stoc_3
Performance-Based Common Stock Warrants - Narrative (Details) | Mar. 09, 2016USD ($)vesting_period$ / sharesshares | Mar. 31, 2020USD ($)shares | Dec. 31, 2019shares | Dec. 31, 2017shares |
Class of Warrant or Right [Line Items] | ||||
Unrecognized estimated fair value of unvested warrants | $ | $ 1,100,000 | |||
Common Stock Purchase Warrants | ||||
Class of Warrant or Right [Line Items] | ||||
Number of shares called by warrants (in shares) | 725,000 | |||
Exercise price of warrants (in dollars per share) | $ / shares | $ 54.55 | |||
Number of vesting periods | vesting_period | 3 | |||
Term of successive vesting periods | 2 years | 2 years | ||
Vesting period one | 2 years | |||
Vested warrants outstanding (in shares) | 275,000 | |||
Unearned underlying shares (in shares) | 225,000 | |||
Number of warrants vested (in shares) | 0 | |||
Comcast Corporation | Common Stock Purchase Warrants | ||||
Class of Warrant or Right [Line Items] | ||||
Number of warrants vested in period (in shares) | 100,000 | 175,000 | ||
Maximum warrants available to vest (in shares) | 250,000 | 250,000 | ||
Supply Threshold | Common Stock Purchase Warrants | ||||
Class of Warrant or Right [Line Items] | ||||
Aggregate level of purchases, $260 million threshold | $ | $ 260,000,000 | |||
Aggregate level of purchases, $340 million threshold | $ | $ 340,000,000 | |||
Supply threshold amount | $ | $ 340,000,000 |
Performance-Based Common Stoc_4
Performance-Based Common Stock Warrants - Purchase Level and Number of Warrants to Vest (Details) - Common Stock Purchase Warrants - Supply Threshold | Mar. 09, 2016USD ($)shares |
Class of Warrant or Right [Line Items] | |
Aggregate level of purchases, threshold one | $ | $ 260,000,000 |
Aggregate level of purchases, threshold two | $ | 300,000,000 |
Aggregate level of purchases, threshold three | $ | $ 340,000,000 |
Incremental Warrants That Will Vest January 1, 2016 - December 31, 2017 | |
$260 million threshold (in shares) | 100,000 |
$300 million threshold (in shares) | 75,000 |
$340 million threshold (in shares) | 75,000 |
Maximum Potential Warrants Earned by Comcast (in shares) | 250,000 |
Incremental Warrants That Will Vest January 1, 2018 - December 31, 2019 | |
$260 million threshold (in shares) | 100,000 |
$300 million threshold (in shares) | 75,000 |
$340 million threshold (in shares) | 75,000 |
Maximum Potential Warrants Earned by Comcast (in shares) | 250,000 |
Incremental Warrants That Will Vest January 1, 2020 - December 31, 2021 | |
$260 million threshold (in shares) | 75,000 |
$300 million threshold (in shares) | 75,000 |
$340 million threshold (in shares) | 75,000 |
Maximum Potential Warrants Earned by Comcast (in shares) | 225,000 |
Performance-Based Common Stoc_5
Performance-Based Common Stock Warrants - Assumptions Used in Valuation and Weighted Average Fair Value of Warrants (Details) - Common Stock Purchase Warrants | Jan. 01, 2020$ / shares | Mar. 31, 2019$ / shares |
Class of Warrant or Right [Line Items] | ||
Fair value (in dollars per share) | $ 17.19 | $ 9 |
Price of Universal Electronics Inc. common stock (in dollars per share) | $ 52.21 | $ 37.46 |
Risk-free interest rate | ||
Class of Warrant or Right [Line Items] | ||
Valuation assumption rate | 0.0162 | 0.0222 |
Expected volatility | ||
Class of Warrant or Right [Line Items] | ||
Valuation assumption rate | 0.4886 | 0.4445 |
Expected life | ||
Class of Warrant or Right [Line Items] | ||
Expected life | 3 years | 3 years 9 months |
Performance-Based Common Stoc_6
Performance-Based Common Stock Warrants - Impact to Net Sales in Connection with Warrants and Related Income Tax Benefit (Details) - Common Stock Purchase Warrants - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Class of Warrant or Right [Line Items] | ||
Reduction to net sales | $ 184 | $ 434 |
Income tax benefit | $ 46 | $ 108 |
Other Income (Expense), Net (De
Other Income (Expense), Net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Other Income and Expenses [Abstract] | ||
Net gain (loss) on foreign currency exchange contracts | $ 252 | $ (271) |
Net gain (loss) on foreign currency exchange transactions | (548) | (132) |
Other income | (52) | (63) |
Other (expense), net | $ (348) | $ (466) |
Earnings (Loss) Per Share - Cal
Earnings (Loss) Per Share - Calculation of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
BASIC | ||
Net income (loss) | $ 5,846 | $ (1,005) |
Weighted-average common shares outstanding (in shares) | 13,960 | 13,827 |
Basic earnings (loss) per share (in dollars per share) | $ 0.42 | $ (0.07) |
DILUTED | ||
Net income (loss) | $ 5,846 | $ (1,005) |
Weighted-average common shares outstanding (in shares) | 13,960 | 13,827 |
Dilutive effect of stock options, restricted stock and common stock warrants (in shares) | 251 | 0 |
Weighted-average common shares outstanding on a diluted basis (in shares) | 14,211 | 13,827 |
Diluted earnings (loss) per share (in dollars per share) | $ 0.41 | $ (0.07) |
Earnings (Loss) Per Share - Sec
Earnings (Loss) Per Share - Securities Excluded from the Computation of Diluted Earnings (Loss) Per Common Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded in computation of diluted earning per share (in shares) | 402 | 543 |
Restricted stock awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded in computation of diluted earning per share (in shares) | 51 | 227 |
Performance-based warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded in computation of diluted earning per share (in shares) | 275 | 175 |
Derivatives - Total Net Fair Va
Derivatives - Total Net Fair Value of Derivatives (Details) - Fair Value Measurements on a Recurring Basis - Foreign Currency Exchange Contracts - Not Designated as Hedging Instrument - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Total Balance | ||
Derivatives, Fair Value [Line Items] | ||
Foreign currency exchange contracts | $ (187) | $ (172) |
Level 1 | ||
Derivatives, Fair Value [Line Items] | ||
Foreign currency exchange contracts | 0 | 0 |
Level 2 | ||
Derivatives, Fair Value [Line Items] | ||
Foreign currency exchange contracts | (187) | (172) |
Level 3 | ||
Derivatives, Fair Value [Line Items] | ||
Foreign currency exchange contracts | $ 0 | $ 0 |
Derivatives - Narrative (Detail
Derivatives - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Derivative Instruments,Gain (Loss) [Line Items] | ||
Net gain (loss) on foreign currency exchange contracts | $ 252 | $ (271) |
Not Designated as Hedging Instrument | Foreign Currency Exchange Contracts | Other Income (Expense), Net | ||
Derivative Instruments,Gain (Loss) [Line Items] | ||
Net gain (loss) on foreign currency exchange contracts | $ 300 | $ (300) |
Derivatives - Foreign Currency
Derivatives - Foreign Currency Exchange Contracts (Details) - Not Designated as Hedging Instrument $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020USD ($)$ / ¥$ / € | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($)$ / R$$ / ¥$ / € | |
USD/Chinese Yuan Renminbi | |||
Derivative [Line Items] | |||
Notional value | $ 30,000 | $ 35,000 | |
Forward rate | $ / ¥ | 7.0555 | 6.9867 | |
Unrealized gain/(loss) recorded at balance sheet date | $ (146) | $ 100 | |
USD/Euro | |||
Derivative [Line Items] | |||
Notional value | $ 35,000 | $ 28,000 | |
Forward rate | $ / € | 1.1017 | 1.1133 | |
Unrealized gain/(loss) recorded at balance sheet date | $ (41) | (253) | |
USD/Brazilian Real | |||
Derivative [Line Items] | |||
Notional value | $ 500 | ||
Forward rate | $ / R$ | 4.0560 | ||
Unrealized gain/(loss) recorded at balance sheet date | (6) | ||
USD/Brazilian Real | USD/Brazilian Real | |||
Derivative [Line Items] | |||
Notional value | $ 700 | ||
Forward rate | $ / R$ | 4.0870 | ||
Unrealized gain/(loss) recorded at balance sheet date | $ (13) |