Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2021 | Aug. 02, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-38358 | |
Entity Registrant Name | INSEEGO CORP. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 81-3377646 | |
Entity Address, Address Line One | 12600 Deerfield Parkway, Suite 100 | |
Entity Address, City or Town | Alpharetta, | |
Entity Address, State or Province | GA | |
Entity Address, Postal Zip Code | 30004 | |
City Area Code | 858 | |
Local Phone Number | 812-3400 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | INSG | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 103,180,708 | |
Entity Central Index Key | 0001022652 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 | |
Current assets: | |||
Cash and cash equivalents | $ 30,841 | $ 40,015 | |
Accounts receivable, net of allowance for doubtful accounts of $296 and $1,384, respectively | 19,983 | 29,940 | |
Inventories | 27,544 | 33,952 | |
Assets held for sale | [1] | 42,450 | 0 |
Prepaid expenses and other | 8,088 | 10,201 | |
Total current assets | 128,906 | 114,108 | |
Restricted cash | 3,693 | 0 | |
Property, plant and equipment, net of accumulated depreciation of $19,758 and $21,715, respectively | 9,330 | 13,699 | |
Rental assets, net of accumulated depreciation of $15,055 and $15,754, respectively | 4,761 | 6,109 | |
Intangible assets, net of accumulated amortization of $ 35,579 and $63,020, respectively | 47,192 | 51,487 | |
Goodwill | 22,175 | 32,511 | |
Right-of-use assets, net | 8,294 | 9,092 | |
Other assets | 389 | 388 | |
Total assets | 224,740 | 227,394 | |
Current liabilities: | |||
Accounts payable | 31,182 | 52,339 | |
Accrued expenses and other current liabilities | 22,874 | 23,373 | |
Liabilities related to assets held for sale | [1] | 11,132 | 0 |
Total current liabilities | 65,188 | 75,712 | |
Long-term liabilities: | |||
2025 Notes, net | 159,120 | 165,147 | |
Deferred tax liabilities, net | 888 | 4,505 | |
Other long-term liabilities | 8,450 | 9,929 | |
Total liabilities | 233,646 | 255,293 | |
Commitments and contingencies | |||
Stockholders’ deficit: | |||
Series E Preferred stock, par value $0.001; 39,500 shares designated, 35,000 shares issued and outstanding, liquidation preference of $1,000 per share (plus any accrued but unpaid dividends) | 0 | 0 | |
Common stock, par value $0.001; 150,000,000 shares authorized, 103,109,346 and 99,399,029 shares issued and outstanding, respectively | 103 | 99 | |
Additional paid-in capital | 761,412 | 711,487 | |
Accumulated other comprehensive loss | (6,279) | (6,972) | |
Accumulated deficit | (764,150) | (732,422) | |
Total stockholders’ deficit attributable to Inseego Corp. | (8,914) | (27,808) | |
Noncontrolling interests | 8 | (91) | |
Total stockholders’ deficit | (8,906) | (27,899) | |
Total liabilities and stockholders’ deficit | $ 224,740 | $ 227,394 | |
[1] | Assets and liabilities held for sale relate to the expected sale of our Ctrack South Africa operations. Refer to Note 4. Business Divestiture |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Allowance for doubtful accounts | $ 296 | $ 1,384 |
Accumulated depreciation, Property, plant and equipment | 19,758 | 21,715 |
Accumulated depreciation, Rental assets | 15,055 | 15,754 |
Accumulated amortization, Intangible assets | $ 35,579 | $ 63,020 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, shares issued (in shares) | 103,109,346 | 99,399,029 |
Common stock, shares outstanding (in shares) | 103,109,346 | 99,399,029 |
Series E preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 39,500 | 39,500 |
Preferred stock issued (in shares) | 35,000 | 35,000 |
Preferred stock, shares outstanding (in shares) | 35,000 | 35,000 |
Preferred stock, liquidation preference per share (in dollars per share) | $ 1,000 | $ 1,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Net revenues: | ||||
IoT & Mobile Solutions | $ 51,836 | $ 69,314 | $ 94,795 | $ 111,729 |
Enterprise SaaS Solutions | 13,857 | 11,375 | 28,495 | 25,800 |
Total net revenues | 65,693 | 80,689 | 123,290 | 137,529 |
Cost of net revenues: | ||||
IoT & Mobile Solutions | 39,740 | 54,240 | 73,178 | 88,279 |
Enterprise SaaS Solutions | 5,604 | 4,449 | 11,288 | 10,023 |
Total cost of net revenues | 45,344 | 58,689 | 84,466 | 98,302 |
Gross profit | 20,349 | 22,000 | 38,824 | 39,227 |
Operating costs and expenses: | ||||
Research and development | 11,773 | 10,540 | 26,328 | 18,764 |
Sales and marketing | 9,821 | 8,648 | 20,825 | 17,403 |
General and administrative | 7,414 | 7,396 | 16,058 | 14,558 |
Amortization of purchased intangible assets | 664 | 753 | 1,130 | 1,579 |
Impairment of capitalized software | 1,197 | 0 | 1,197 | 0 |
Total operating costs and expenses | 30,869 | 27,337 | 65,538 | 52,304 |
Operating loss | (10,520) | (5,337) | (26,714) | (13,077) |
Other income (expense): | ||||
Loss on debt conversion and extinguishment, net | 0 | (67,241) | (432) | (75,174) |
Interest expense, net | (1,678) | (3,160) | (3,523) | (6,540) |
Other income (expense), net | (617) | 787 | 1,117 | 1,765 |
Loss before income taxes | (12,815) | (74,951) | (29,552) | (93,026) |
Income tax provision (benefit) | 228 | (115) | 449 | (24) |
Net loss | (13,043) | (74,836) | (30,001) | (93,002) |
Less: Net loss (income) attributable to noncontrolling interests | 0 | 6 | (214) | (26) |
Net loss attributable to Inseego Corp. | (13,043) | (74,830) | (30,215) | (93,028) |
Series E preferred stock dividends | (886) | (835) | (1,753) | (1,227) |
Net loss attributable to common stockholders | $ (13,929) | $ (75,665) | $ (31,968) | $ (94,255) |
Net loss per common share: | ||||
Basic (in dollars per share) | $ (0.14) | $ (0.78) | $ (0.31) | $ (1.01) |
Diluted (in dollars per share) | $ (0.14) | $ (0.78) | $ (0.31) | $ (1.01) |
Weighted-average shares used in computation of net loss per common share: | ||||
Basic (in shares) | 102,935,213 | 96,487,344 | 102,157,146 | 93,680,846 |
Diluted (in shares) | 102,935,213 | 96,487,344 | 102,157,146 | 93,680,846 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (13,043) | $ (74,836) | $ (30,001) | $ (93,002) |
Foreign currency translation adjustment | 2,425 | 1,576 | 693 | (11,904) |
Total comprehensive loss | (10,618) | (73,260) | (29,308) | (104,906) |
Comprehensive income attributable to noncontrolling interests | 0 | 6 | (214) | (26) |
Comprehensive loss attributable to Inseego Corp. | $ (10,618) | $ (73,254) | $ (29,522) | $ (104,932) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Series E preferred stock | Common shares | Preferred Stock | Preferred StockSeries E preferred stock | Common Stock | Common StockCommon shares | Additional Paid-in Capital | Additional Paid-in CapitalSeries E preferred stock | Additional Paid-in CapitalCommon shares | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Noncontrolling Interests |
Beginning balance at Dec. 31, 2019 | $ (37,358) | $ 0 | $ 82 | $ 584,862 | $ (3,879) | $ (618,303) | $ (120) | ||||||
Beginning Balance (shares) at Dec. 31, 2019 | 10,000 | 81,974,000 | |||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Exercise of warrants (shares) | 338,454 | ||||||||||||
Ending balance at Mar. 31, 2020 | $ 27,803 | $ 0 | $ 96 | 682,047 | (17,359) | (636,893) | (88) | ||||||
Ending Balance (shares) at Mar. 31, 2020 | 37,000 | 96,180,000 | |||||||||||
Beginning balance at Dec. 31, 2019 | (37,358) | $ 0 | $ 82 | 584,862 | (3,879) | (618,303) | (120) | ||||||
Beginning Balance (shares) at Dec. 31, 2019 | 10,000 | 81,974,000 | |||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Net income (loss) | (93,002) | (93,028) | 26 | ||||||||||
Foreign currency translation adjustment | (11,904) | (11,904) | |||||||||||
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan | 1,712 | $ 1 | 1,711 | ||||||||||
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan (shares) | 967,000 | ||||||||||||
Taxes withheld on net settled vesting of restricted stock units | (281) | (281) | |||||||||||
Issuance of shares | $ 25,000 | $ 25,000 | |||||||||||
Issuance of shares (shares) | 25,000 | ||||||||||||
Issuance of Series E preferred stock in lieu of interest | 2,330 | 2,330 | |||||||||||
Issuance of Series E preferred stock in lieu of interest (shares) | 2,000 | ||||||||||||
Issuance of common shares in connection with conversion or exchange of notes | $ 66,087 | $ 14 | $ 66,073 | ||||||||||
Issuance of common shares in connection with conversion or exchange of notes (shares) | 13,739,000 | ||||||||||||
Repurchase of Series E preferred stock | (2,354) | (2,354) | |||||||||||
Repurchase of Series E preferred stock (shares) | (2,000) | ||||||||||||
Exercise of warrants | 1,861 | 1,861 | |||||||||||
Exercise of warrants (shares) | 338,000 | ||||||||||||
Share-based compensation | 5,981 | 5,981 | |||||||||||
Series E preferred stock dividends | 0 | 1,227 | (1,227) | ||||||||||
Ending balance at Jun. 30, 2020 | (41,928) | $ 0 | $ 97 | 686,410 | (15,783) | (712,558) | (94) | ||||||
Ending Balance (shares) at Jun. 30, 2020 | 35,000 | 97,018,000 | |||||||||||
Beginning balance at Mar. 31, 2020 | 27,803 | $ 0 | $ 96 | 682,047 | (17,359) | (636,893) | (88) | ||||||
Beginning Balance (shares) at Mar. 31, 2020 | 37,000 | 96,180,000 | |||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Net income (loss) | (74,836) | (74,830) | (6) | ||||||||||
Foreign currency translation adjustment | 1,576 | 1,576 | |||||||||||
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan | 1,663 | $ 1 | 1,662 | ||||||||||
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan (shares) | 838,000 | ||||||||||||
Taxes withheld on net settled vesting of restricted stock units | (208) | (208) | |||||||||||
Repurchase of Series E preferred stock | $ (2,354) | $ (2,354) | |||||||||||
Repurchase of Series E preferred stock (shares) | (2,000) | ||||||||||||
Share-based compensation | 4,428 | 4,428 | |||||||||||
Series E preferred stock dividends | 0 | 835 | (835) | ||||||||||
Ending balance at Jun. 30, 2020 | (41,928) | $ 0 | $ 97 | 686,410 | (15,783) | (712,558) | (94) | ||||||
Ending Balance (shares) at Jun. 30, 2020 | 35,000 | 97,018,000 | |||||||||||
Beginning balance at Dec. 31, 2020 | (27,899) | $ 0 | $ 99 | 711,487 | (6,972) | (732,422) | (91) | ||||||
Beginning Balance (shares) at Dec. 31, 2020 | 35,000 | 99,399,000 | |||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Net income (loss) | (30,001) | (30,215) | 214 | ||||||||||
Foreign currency translation adjustment | 693 | 693 | |||||||||||
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan | 2,844 | $ 2 | 2,842 | ||||||||||
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan (shares) | 1,765,000 | ||||||||||||
Taxes withheld on net settled vesting of restricted stock units | (825) | (825) | |||||||||||
Issuance of shares | 29,369 | $ 1 | 29,368 | ||||||||||
Issuance of shares (shares) | 1,516,000 | ||||||||||||
Issuance of common shares in connection with conversion or exchange of notes | 5,383 | $ 1 | 5,382 | ||||||||||
Issuance of common shares in connection with conversion or exchange of notes (shares) | 429,000 | ||||||||||||
Share-based compensation | 11,405 | 11,405 | |||||||||||
Net noncontrolling interest acquired | 125 | 240 | (115) | ||||||||||
Series E preferred stock dividends | 0 | 1,753 | (1,753) | ||||||||||
Ending balance at Jun. 30, 2021 | (8,906) | $ 0 | $ 103 | 761,412 | (6,279) | (764,150) | 8 | ||||||
Ending Balance (shares) at Jun. 30, 2021 | 35,000 | 103,109,000 | |||||||||||
Beginning balance at Mar. 31, 2021 | (1,463) | $ 0 | $ 103 | 757,352 | (8,704) | (750,221) | 7 | ||||||
Beginning Balance (shares) at Mar. 31, 2021 | 35,000 | 102,773,000 | |||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Net income (loss) | (13,043) | (13,043) | 0 | ||||||||||
Foreign currency translation adjustment | 2,425 | 2,425 | |||||||||||
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan | 1,282 | $ 0 | 1,282 | ||||||||||
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan (shares) | 336,000 | ||||||||||||
Taxes withheld on net settled vesting of restricted stock units | (356) | (356) | |||||||||||
Issuance of shares | $ (59) | $ (59) | |||||||||||
Share-based compensation | 2,307 | 2,307 | |||||||||||
Net noncontrolling interest acquired | 1 | 1 | |||||||||||
Series E preferred stock dividends | 0 | 886 | (886) | ||||||||||
Ending balance at Jun. 30, 2021 | $ (8,906) | $ 0 | $ 103 | $ 761,412 | $ (6,279) | $ (764,150) | $ 8 | ||||||
Ending Balance (shares) at Jun. 30, 2021 | 35,000 | 103,109,000 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | ||
Cash flows from operating activities: | |||
Net income (loss) | $ (30,001) | $ (93,002) | |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||
Depreciation and amortization | 13,051 | 9,692 | |
Provision for bad debts, net of recoveries | 266 | 74 | |
Impairment of capitalized software | 1,197 | 0 | |
Provision for excess and obsolete inventory | 496 | 180 | |
Share-based compensation expense | 11,405 | 5,981 | |
Amortization of debt discount and debt issuance costs | 746 | 3,245 | |
Fair value adjustment on derivative instrument | (1,823) | (826) | |
Loss on debt conversion and extinguishment, net | 432 | 75,174 | |
Deferred income taxes | 38 | 10 | |
Other | 553 | 158 | |
Changes in assets and liabilities: | |||
Accounts receivable | [1] | 6,483 | (21,498) |
Inventories | [1] | (834) | 2,725 |
Prepaid expenses and other assets | [1] | 1,158 | (5,298) |
Accounts payable | [1] | (16,015) | 22,334 |
Accrued expenses, income taxes, and other | [1] | 818 | 5,713 |
Net cash (used in) provided by operating activities | (12,030) | 4,662 | |
Cash flows from investing activities: | |||
Acquisition of noncontrolling interest | (116) | 0 | |
Purchases of property, plant and equipment | (2,455) | (2,831) | |
Proceeds from the sale of property, plant and equipment | 506 | 235 | |
Additions to capitalized software development costs and purchases of intangible assets | (15,369) | (10,637) | |
Net cash used in investing activities | (17,434) | (13,233) | |
Cash flows from financing activities: | |||
Gross proceeds from the issuance of 2025 Notes | 0 | 100,000 | |
Payment of issuance costs related to 2025 Notes | 0 | (2,544) | |
Cash paid to investors in private exchange transactions | 0 | (32,062) | |
Payoff of term loan and related extinguishment costs | 0 | (48,830) | |
Gross proceeds received from issuance of Series E preferred stock | 0 | 25,000 | |
Repurchase of Series E preferred stock | 0 | (2,354) | |
Proceeds from the exercise of warrants to purchase common stock | 0 | 1,861 | |
Net borrowing of bank and overdraft facilities | 295 | 104 | |
Principal payments under finance lease obligations | (2,173) | (1,462) | |
Proceeds from a public offering, net of issuance costs | 29,369 | 0 | |
Proceeds from stock option exercises and employee stock purchase plan, net of taxes paid on vested restricted stock units | 2,020 | 1,431 | |
Net cash provided by financing activities | 29,511 | 41,144 | |
Effect of exchange rates on cash | 321 | (2,547) | |
Net increase in cash, cash equivalents and restricted cash | 368 | 30,026 | |
Cash, cash equivalents and restricted cash, beginning of period | 40,015 | 12,074 | |
Cash, and cash equivalents, and restricted cash, end of period | [2] | 40,383 | 42,100 |
Cash paid during the year for: | |||
Interest | 2,782 | 532 | |
Income taxes | 252 | 9 | |
Supplemental disclosures of non-cash activities: | |||
Transfer of inventories to rental assets | 3,403 | 1,511 | |
Capital expenditures financed through accounts payable or accrued liabilities | 3,641 | 3,393 | |
Right-of-use assets obtained in exchange for operating leases liabilities | 148 | 4,229 | |
Preferred stock issued in extinguishment of term loan accrued interest | 0 | 2,330 | |
Debt discount and issuance costs extinguished in notes conversion | 0 | 1,728 | |
2022 Notes conversion to equity | 0 | 59,907 | |
Novatel Wireless Notes conversion to equity | 0 | 250 | |
2025 Notes issued to extinguish the 2022 Notes | 0 | 80,375 | |
2025 Notes conversion, including shares issued in satisfaction of interest make-whole payment | $ 5,383 | $ 0 | |
[1] | Operating assets and liabilities balances include assets and liabilities classified as held for sale as of June 30, 2021 (see Note 4. Business Divestiture ). | ||
[2] | Cash, cash equivalents and restricted cash balance includes restricted cash of $3,693, and cash and cash equivalents of $5,849 classified as held for sale as of June 30, 2021 (see Note 4. Business Divestiture |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The information contained herein has been prepared by Inseego Corp. (the “Company”) in accordance with the rules of the Securities and Exchange Commission (the “SEC”). The information at June 30, 2021 and the results of the Company’s operations for the three and six months ended June 30, 2021 and 2020 are unaudited. The condensed consolidated financial statements reflect all adjustments, consisting of only normal recurring accruals, except otherwise disclosed herein, which are, in the opinion of management, necessary for a fair statement of the results of the interim periods presented. These unaudited condensed consolidated financial statements and notes hereto should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The year-end condensed consolidated balance sheet data as of December 31, 2020 was derived from the Company’s audited consolidated financial statements and may not include all disclosures required by accounting principles generally accepted in the United States. Certain prior period amounts were reclassified to conform to the current period presentation. These reclassifications did not affect total revenues, costs and expenses, net loss, assets, liabilities or stockholders’ deficit. Except as set forth below, the accounting policies used in preparing these unaudited condensed consolidated financial statements are the same as those described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The results of operations for the interim periods presented are not necessarily indicative of results to be expected for any other interim period or for the year as a whole. Risks and Uncertainties In December 2019, COVID-19 was reported to have surfaced in Wuhan, China, resulting in shutdowns of manufacturing and commerce globally in the months that followed. Since then, the COVID-19 pandemic has spread worldwide, and has resulted in authorities implementing numerous measures to try to contain the disease or slow its spread, such as travel bans and restrictions, quarantines, shelter-in-place orders and shutdowns. The extent of the impact of the COVID-19 pandemic on the Company’s operational and financial performance will depend on future developments, including the duration and spread of the pandemic and related actions taken by the U.S. government, state and local government officials, and international governments to prevent the spread of the disease, all of which are uncertain and cannot be predicted. In addition, a global semiconductor supply shortage is having wide-ranging effects across the technology industry. This semiconductor shortage has not materially impacted the Company but may impact the Company’s customers, and may negatively impact the supply of materials needed for our testing and production timeline. Our suppliers, contract manufacturers, and our customers are all taking actions to reduce the impact of the semiconductor shortage; however, if the shortage persists, the impact on our business could be material. Liquidity As of June 30, 2021, the Company had (i) available cash and cash equivalents totaling $36.7 million, including $5.8 million cash and cash equivalents classified as held-for-sale, and excluding restricted cash of $3.7 million, and (ii) working capital of $32.4 million, excluding assets and liabilities classified as held-for-sale. On March 6, 2020, the Company issued and sold 25,000 shares of Fixed-Rate Cumulative Perpetual Preferred Stock, Series E, par value $0.001 per share (the “Series E Preferred Stock”), for an aggregate purchase price of $25.0 million. In the first quarter of 2020, $59.9 million of the Company’s 5.5% convertible senior notes due 2022 (the “2022 Notes” formerly referred to as the “Inseego Notes”) were exchanged for common stock in private exchange transactions. Additionally, in the second quarter of 2020, the Company restructured its outstanding debt by completing a $100.0 million registered public offering (the “Offering”) of 3.25% convertible senior notes due 2025 (the “2025 Notes”) and also entered in privately-negotiated Exchange Agreements, pursuant to which an aggregate of $45.0 million in principal amount of the 2022 Notes were exchanged for an aggregate of $32 million in cash and $80.4 million in principal amount of the 2025 Notes (the “Private Exchange Transactions”). The Company also used a portion of the proceeds from the Offering to repay in full its previous term loan. In the third quarter of 2020, the Company redeemed the remaining $2,000 principal amount of the 2022 Notes. During the quarter ended September 30, 2020, certain holders of the 2025 Notes converted approximately $13.5 million in principal amount of the 2025 Notes into 1,177,156 shares of the Company’s common stock in accordance with the terms of such notes. As of June 30, 2021, the Company’s outstanding debt primarily consisted of $161.9 million in principal amount of 2025 Notes. On January 25, 2021, the Company entered into an Equity Distribution Agreement with Canaccord Genuity LLC (the “Agent”), pursuant to which the Company may offer and sell, from time to time, through or to the Agent, up to $40.0 million of shares of its common stock (the “ATM Offering”). In January 2021, the Company sold 1,516,073 shares of common stock, at an average price of $20.11 per share, for net proceeds of $29.4 million, after deducting underwriter fees and discounts of $0.9 million, and other offering fees, pursuant to the ATM Offering. On July 30, 2021, the Company completed the sale of Ctrack South Africa. Initial cash proceeds of approximately $36.6 million were received. The Company has a history of operating and net losses and overall usage of cash from operating and investing activities. The Company’s management believes that its cash and cash equivalents, together with anticipated cash flows from operations, will be sufficient to meet its cash flow needs for the next twelve months from the filing date of this report. The Company’s ability to attain more profitable operations and continue to generate positive cash flow is dependent upon achieving a level and mix of revenues adequate to support its evolving cost structure. If events or circumstances occur such that the Company does not meet its operating plan as expected, or if the Company becomes obligated to pay unforeseen expenditures as a result of ongoing litigation, the Company may be required to raise capital, reduce planned research and development activities, incur additional restructuring charges or reduce other operating expenses which could have an adverse impact on its ability to achieve its intended business objectives. The Company’s liquidity could be impaired if there is any interruption in its business operations, a material failure to satisfy its contractual commitments or a failure to generate revenue from new or existing products. There can be no assurance that any required or desired restructuring or financing will be available on terms favorable to the Company, or at all. Additionally, the Company is uncertain of the full extent to which the COVID-19 pandemic will impact the Company’s business, operations and financial results. Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly- and majority-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Segment Information Management has determined that the Company has one reportable segment. The Chief Executive Officer, who is also the Chief Operating Decision Maker, does not manage any part of the Company separately, and the allocation of resources and assessment of performance is based solely on the Company’s consolidated operations and operating results. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent liabilities. Actual results could differ materially from these estimates. Significant estimates include revenue recognition, capitalized software costs, allowance for doubtful accounts receivable, provision for excess and obsolete inventory, valuation of intangible and long-lived assets, valuation of goodwill, valuation of derivatives, accruals relating to litigation, income taxes and share-based compensation expense. The inputs related to certain estimates include consideration of the economic impact of the COVID-19 pandemic. As the impact of the COVID-19 pandemic continues to develop, these estimates could carry a higher degree of variability and volatility, and may change materially in future periods. Sources of Revenue The Company generates revenue from a broad range of product sales including intelligent wireless hardware products for the worldwide mobile communications, and industrial Internet of Things (“IIoT”) markets, Inseego Subscribe TM , a hosted SaaS platform that helps organizations manage the selection, deployment and spend of wireless assets, and various Software as a Service (“SaaS”) products. The Company’s products principally include intelligent mobile hotspots, wireless routers for IoT applications, USB modems, integrated telematics and mobile tracking hardware devices, which are supported by applications software and cloud software services designed to enable customers to easily analyze data insights and configure and manage their hardware. The Company classifies its revenues from the sale of its products and services into two distinct groupings, specifically IoT & Mobile Solutions and Enterprise SaaS Solutions. Both IoT & Mobile Solutions and Enterprise SaaS Solutions revenues include any hardware and software required for the respective solution. IoT & Mobile Solutions . The IoT & Mobile Solutions portfolio is comprised of end-to-end edge to cloud solutions including 4G LTE mobile broadband gateways, routers, modems, hotspots, HD quality VoLTE based wireless home phones, cloud management software and an advanced portfolio of 5G products. The solutions are offered under the MiFi™ brand for consumer and enterprise markets, and under the Skyus brand for IIoT markets. Effective in the third quarter ended on September 30, 2020, IoT & Mobile Solutions also includes the Company’s Device Management System (“DMS”), rebranded as Inseego Subscribe TM , that helps organizations manage the selection, deployment and spend of their customer’s wireless assets, helping them save money on personnel and telecom expenses. The Company reclassified its Inseego Subscribe revenue stream from Enterprise SaaS Solutions to better reflect the Company's end user delineation. This reclassification had no impact on previously reported total net revenue, gross profit, or net loss. Enterprise SaaS Solutions . The Enterprise SaaS Solutions portfolio consists of various subscription offerings to gain access to the Company’s Ctrack telematics platforms, which provide fleet vehicle, aviation ground vehicle and asset tracking and performance information, and other telematics applications. Reclassification |
Financial Statement Details
Financial Statement Details | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Financial Statement Details | Financial Statement Details Inventories Inventories, net, consist of the following (in thousands): June 30, December 31, Finished goods $ 24,881 $ 27,009 Raw materials and components 2,663 6,943 Total inventories 1 $ 27,544 $ 33,952 1 Amounts exclude balances classified as held for sale. See Note 4. Business Divestiture. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following (in thousands): June 30, December 31, Royalties $ 1,932 $ 2,410 Payroll and related expenses 9,063 6,006 Professional fees 766 921 Accrued interest 852 888 Deferred revenue 3,398 2,853 Operating lease liabilities 1,637 1,619 Accrued production costs 901 938 Liabilities related to financed assets 490 1,198 Other 3,835 6,540 Total accrued expenses and other current liabilities 1 $ 22,874 $ 23,373 1 Amounts exclude balances classified as held for sale. See Note 4. Business Divestiture. |
Fair Value Measurement of Asset
Fair Value Measurement of Assets and Liabilities | 6 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement of Assets and Liabilities | Fair Value Measurement of Assets and LiabilitiesFair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). A fair value measurement reflects the assumptions market participants would use in pricing an asset or liability based on the best available information. These assumptions include the risk inherent in a particular valuation technique (such as a pricing model) and the risks inherent in the inputs to the model. The Company classifies inputs to measure fair value using a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. The categorization of financial instruments within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy is prioritized into three levels (with Level 3 being the lowest) and is defined as follows: Level 1: Pricing inputs are based on quoted market prices for identical assets or liabilities in active markets (e.g., NYSE or NASDAQ). Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Pricing inputs include benchmark yields, trade data, reported trades and broker dealer quotes, two-sided markets and industry and economic events, yield to maturity, Municipal Securities Rule Making Board reported trades and vendor trading platform data. Level 2 includes those financial instruments that are valued using various pricing services and broker pricing information including Electronic Communication Networks and broker feeds. Level 3: Pricing inputs include significant inputs that are generally less observable from objective sources, including the Company’s own assumptions. The fair market value for level 3 securities may be highly sensitive to the use of unobservable inputs and subjective assumptions. Generally, changes in significant unobservable inputs may result in significantly lower or higher fair value measurements. The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. There have been no transfers of assets or liabilities between fair value measurement classifications during the six months ended June 30, 2021. The following tables summarize the Company’s financial instruments measured at fair value on a recurring basis in accordance with the authoritative guidance for fair value measurements as of June 30, 2021 and December 31, 2020 (in thousands): June 30, 2021 December 31, 2020 Total Fair Value Level 3 Level 1 Total Fair Value Level 3 Level 1 Assets Cash equivalents Money market funds $ 126 $ — $ 126 $ 126 $ — $ 126 Total assets $ 126 $ — $ 126 $ 126 $ — $ 126 Liabilities 2025 Notes Interest make-whole payment $ 2,929 $ 2,929 $ — $ 4,898 $ 4,898 $ — Total liabilities $ 2,929 $ 2,929 $ — $ 4,898 $ 4,898 $ — The fair value of the interest make-whole payment derivative liability was determined using a Monte Carlo model with the following key assumptions: June 30, 2021 December 31, 2020 Volatility 50 % 50 % Stock price $10.09 per share $15.47 per share Credit spread 15.56 % 19.25 % Term 3.84 years 4.34 years Dividend yield — % — % Risk-free rate 0.63 % 0.30 % The following table sets forth a summary of changes in the fair value of Level 3 liabilities for the six months ended June 30, 2021 (in thousands): Balance as of Additions Conversions Change in fair value Balance as of Liabilities: Interest make-whole payment $ 4,898 $ — $ (146) $ (1,823) $ 2,929 Other Financial Instruments The Company’s financial assets and liabilities are carried at fair value or at amounts that, because of their short-term nature, approximate current fair value, with the exception of the 2025 Notes. On May 12, 2020, the Company issued $180.4 million in aggregate principal amount of 2025 Notes, and restructured its outstanding debt as described further in Note 5, Debt. The Company carries its 2025 Notes at amortized cost adjusted for changes in fair value of the embedded derivative. As of June 30, 2021, $161.9 million in principal amount of the 2025 Notes remain outstanding. It is not practicable to determine the fair value of the 2025 Notes due to the lack of information available to calculate the fair value of such notes. The Company evaluated the 2025 Notes under ASC 815 and identified an embedded derivative that required bifurcation. The embedded derivative is an interest make-whole payment that was valued at $4.6 million on May 12, 2020. Changes in the fair value of the interest make-whole payment totaling a loss of $0.1 million for the three months ended June 30, 2021 are included in the Company’s condensed consolidated statement of operations within other income, net. During the six months ended June 30, 2021, certain holders of the 2025 Notes converted an aggregate of approximately $5.0 million in principal amount of the 2025 Notes into shares of the Company’s common stock in accordance with the terms of such notes and a portion of the embedded derivative was settled in shares of the Company’s common stock resulting in $0.1 million of the derivative liability being extinguished upon conversion. As of June 30, 2021, the embedded derivative had a fair value of $2.9 million and a $1.8 million gain on the change in fair value was recorded to other income, net, on the condensed consolidated statement of operations in the six months ended June 30, 2021. |
Business Divestiture
Business Divestiture | 6 Months Ended |
Jun. 30, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Business Divestiture | Business Divestiture Sale of Ctrack South Africa Operations On February 24, 2021, the Company entered into a Share Purchase Agreement (the “Purchase Agreement”) with an affiliate of Convergence Partners (“Convergence”), an investment management firm in South Africa, to sell the Company’s Ctrack business operations in Africa, Pakistan and the Middle East (together, “Ctrack South Africa”), in an all-cash transaction for 528.9 million South African Rand (“ZAR”) (approximately $36.6 million United States Dollars (“USD”)). The Purchase Agreement provides for an adjustment to the purchase price based on a normalized level of net working capital. The final net consideration is subject to working capital adjustments that are expected to be agreed upon and finalized with Convergence no later than 35 business days after completion of the sale. The consummation of the sale was subject to a number of customary conditions precedent. Additionally, the consummation of the sale was subject to Convergence closing an investment fund. On June 30, 2021, the Company entered into an Addendum to the Purchase Agreement with Convergence. Pursuant to the Addendum, the Company and Convergence have agreed to extend the date by which certain of the closing conditions must be fulfilled or otherwise waived and set the closing date of the transaction to be on or before July 30, 2021. Effective upon the execution of the Purchase Agreement, the assets and liabilities of the Ctrack South Africa entities that are subject to the sale, meet the criteria for classification of held for sale (“HFS”), since the sale of the Ctrack South Africa operations under the Purchase Agreement is subject only to usual and customary closing conditions, and the sale is expected to be completed in less than one year from the date of the Purchase Agreement. The following table presents assets and liabilities of Ctrack South Africa which are classified as HFS as of June 30, 2021 (in thousands): Balance as of Assets : Cash and cash equivalents $ 5,849 Accounts receivable, net 3,640 Inventory 3,650 Prepaid expenses and other 798 Property, plant and equipment, net 4,197 Rental assets, net 2,392 Intangible assets, net 11,010 Goodwill 10,914 Total assets held for sale $ 42,450 Liabilities: Accounts payable $ 5,302 Accrued expenses and other liabilities 1,294 Deferred tax liabilities, net 3,717 Other long-term liabilities 819 Total liabilities related to assets held for sale $ 11,132 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Debt Term Loan On August 23, 2017, the Company and certain of its direct and indirect subsidiaries, as guarantors, entered into a credit agreement (the “Credit Agreement”) with Cantor Fitzgerald Securities, as administrative agent and collateral agent, and certain funds managed by Highbridge Capital Management, LLC, as lenders (the “Lenders”). Pursuant to the Credit Agreement, the Lenders provided the Company with a term loan in the principal amount of $48.0 million (the “Term Loan”) with a maturity date of August 23, 2020. On March 31, 2020, the Company issued 2,330 shares of Series E Preferred Stock to South Ocean Funding L.L.C. (“South Ocean”), the Lender holding all of the aggregate principal amount then outstanding under the Credit Agreement in satisfaction of all then accrued interest under the Credit Agreement. On May 12, 2020, the Company used a portion of the proceeds from the Offering to repay in full the Term Loan and terminate the Credit Agreement. The amounts paid included $47.5 million in outstanding principal, approximately $0.5 million in interest accrued thereon, and a prepayment fee of $1.4 million. The Company also used a portion of the proceeds of the Offering to repurchase the 2,330 shares of Series E Preferred Stock that had been issued to South Ocean for $2.4 million. The Term Loan bore interest at a rate per annum equal to the three-month LIBOR, but in no event less than 1.00%, plus 7.625%. The effective interest rate was 15.19% for the six months ended June 30, 2020. The following table sets forth total interest expense recognized related to the Term Loan (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Contractual interest expense $ — $ 516 $ — $ 1,667 Amortization of debt discount — 526 — 859 Amortization of debt issuance costs — 63 — 103 Total interest expense $ — $ 1,105 $ — $ 2,629 Convertible Notes 2025 Notes On May 12, 2020, the Company completed its registered public Offering of $100.0 million aggregate principal amount of 2025 Notes. On May 12, 2020, the Company also entered into separate privately-negotiated Exchange Agreements with certain holders of the 2022 Notes. Pursuant to the Exchange Agreements, these noteholders agreed to exchange the 2022 Notes that they held (representing an aggregate of $45.0 million principal amount of 2022 Notes with an estimated fair value of approximately $112.4 million as of the date of exchange) for an aggregate of $32.0 million in cash and $80.4 million principal amount of 2025 Notes in private placement transactions that closed concurrently with the registered Offering. In connection therewith, the Company recorded a loss of $67.2 million on debt conversion and extinguishment, net in the condensed consolidated statement of operations. The 2025 Notes issued in the Private Exchange Transactions are part of the same series as the 2025 Notes issued in the registered Offering. During the three months ended March 31, 2021, certain holders of the 2025 Notes converted an aggregate of approximately $5.0 million in principal amount of the 2025 Notes into 428,669 shares of the Company’s common stock, including 32,221 shares of common stock issued in satisfaction of the interest make-whole payment. In connection therewith, the Company recorded a loss of $0.4 million on debt conversion, net in the condensed consolidated statement of operations. The 2025 Notes are issued under an indenture, dated May 12, 2020 (the “Base Indenture”), between the Company and Wilmington Trust, National Association, as trustee (the “Trustee”), as supplemented by the first supplemental indenture, dated May 12, 2020 (the “Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), between the Company and the Trustee. The 2025 Notes will mature on May 1, 2025, unless earlier repurchased, redeemed or converted. The 2025 Notes are senior unsecured obligations of the Company and bear interest at an annual rate of 3.25%, payable semi-annually in arrears on May 1 and November 1 of each year, beginning on November 1, 2020. Holders of the 2025 Notes may convert the 2025 Notes into shares of the Company’s common stock (together with cash in lieu of any fractional share), at their option, at any time until the close of business on the scheduled trading day immediately before the maturity date. Upon conversion of the 2025 Notes, the Company will deliver for each $1,000 principal amount of 2025 Notes converted a number of shares of common stock (together with cash in lieu of any fractional share), equal to the conversion rate. The initial conversion rate for the 2025 Notes is 79.2896 shares of common stock per $1,000 principal amount of 2025 Notes, which represents an initial conversion price of approximately $12.61 per share, and is subject to adjustment upon the occurrence of certain events, including, but not limited to, certain stock dividends, splits and combinations, the issuance of certain rights, options or warrants to holders of the common stock, certain distributions of assets, debt securities, capital stock or other property to holders of the common stock, cash dividends on the common stock and certain Company tender or exchange offers. If a fundamental change (as defined in the Indenture) occurs at any time prior to the maturity date, then the noteholders may require the Company to repurchase their 2025 Notes at a cash repurchase price equal to the principal amount of the 2025 Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. If a make-whole fundamental change (as defined in the Indenture) occurs, then the Company will in certain circumstances increase the conversion rate for a specified period of time. The 2025 Notes will be redeemable, in whole or in part, at the Company’s option at any time, and from time to time, on or after May 6, 2023 and on or before the scheduled trading day before the maturity date, at a cash redemption price equal to the principal amount of the 2025 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, as long as the last reported sale price per share of the common stock exceeds 130% of the conversion price on (i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice; and (ii) the trading day immediately before the date the Company sends such notice. The Indenture contains customary events of default. If an event of default (other than certain events of bankruptcy, insolvency or reorganization involving the Company) occurs and is continuing, the Trustee, by notice to the Company, or the holders of the 2025 Notes representing at least 25% in aggregate principal amount of the outstanding 2025 Notes, by notice to the Company and the Trustee, may declare 100% of the principal of, and all accrued and unpaid interest on, all of the then outstanding 2025 Notes to be due and payable immediately. Upon the occurrence of certain events of bankruptcy, insolvency or reorganization involving the Company, 100% of the principal of, and all accrued and unpaid interest on, all of the then outstanding 2025 Notes will automatically become immediately due and payable. Notwithstanding the foregoing, the Indenture provides that, to the extent the Company elects, the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants in the Indenture will, for the first 360 days after such event of default, consist exclusively of the right to receive additional interest on the 2025 Notes. Interest make-whole payment The 2025 Notes also include an interest make-whole payment feature whereby if the last reported sale price of the Company’s common stock for each of the five trading days immediately preceding a conversion date is greater than or equal to $10.51, the Company will, in addition to the other consideration payable or deliverable in connection with such conversion, make an interest make-whole payment to the converting holder equal to the sum of the present values of the scheduled payments of interest that would have been made on the 2025 Notes to be converted had such notes remained outstanding from the conversion date through the earlier of (i) the date that is three years after the conversion date and (ii) the maturity date. The present values will be computed using a discount rate equal to 1%. The Company will satisfy its obligation to pay the interest make-whole payment, at its election, in cash or shares of common stock (together with cash in lieu of fractional shares). The Company has determined that this feature is an embedded derivative and has recognized the fair value of this derivative as a liability in the condensed consolidated balance sheets, with subsequent changes to fair value to be recorded at each reporting period on the condensed consolidated statement of operations in other income, net. As of June 30, 2021, $161.9 million in principal amount of the 2025 Notes were outstanding, $80.4 million of which were held by related parties. The 2025 Notes consist of the following (in thousands): June 30, December 31, Liability component Principal $ 161,898 $ 166,898 Add: fair value of embedded derivative 2,929 4,898 Less: unamortized debt discount (3,178) (3,703) Less: unamortized issuance costs (2,529) (2,946) Net carrying amount $ 159,120 $ 165,147 The effective interest rate on the liability component of the 2025 Notes was 4.16% for the six months ended June 30, 2021. The following table sets forth total interest expense recognized related to the 2025 Notes (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Contractual interest expense $ 1,315 $ 800 $ 2,584 $ 800 Amortization of debt discount 207 124 415 124 Amortization of debt issuance costs 165 96 330 96 Total interest expense $ 1,687 $ 1,020 $ 3,329 $ 1,020 2022 Notes On January 9, 2017, in connection with the settlement of an exchange offer and consent solicitation with respect to the 5.50% convertible senior notes due 2020 (the “Novatel Wireless Notes”), the Company issued approximately $119.8 million aggregate principal amount of 2022 Notes. During the three months ended March 31, 2020, the Company entered into privately-negotiated exchange agreements with certain investors holding the 2022 Notes. Pursuant to those exchange agreements, the investors exchanged $59.9 million in aggregate principal amount of outstanding 2022 Notes for 13,688,876 shares of common stock. The investors that participated in such exchange agreements agreed to waive any accrued but unpaid interest on the exchanged 2022 Notes. Included in the 13,688,876 shares of common stock issued in the exchange transactions that took place during the three months ended March 31, 2020 were 942,706 shares valued at $7.9 million on the date of issuance at fair value, which were issued pursuant to the terms of the privately-negotiated exchange agreements and were in excess of the consideration issuable under the original conversion terms of the exchanged 2022 Notes. ASC 470, Debt , requires the recognition through earnings of an inducement charge equal to the fair value of the consideration delivered in excess of the consideration issuable under the original conversion terms. This resulted in a non-cash charge of $7.9 million for the three months ended March 31, 2020, which was recorded as inducement expense in the condensed consolidated statement of operations. Pursuant to the Private Exchange Transactions described above, on May 12, 2020, the holders of an aggregate of $45.0 million principal amount of 2022 Notes exchanged their 2022 Notes for a combination of 2025 Notes and cash. As a result of the Private Exchange Transactions, $2,000 in principal amount of the 2022 Notes were outstanding as of June 30, 2020. On July 22, 2020, pursuant to a redemption notice issued on May 15, 2020, the Company redeemed the remaining $2,000 principal amount of the 2022 Notes. The effective interest rate on the liability component of the 2022 Notes was 12.89% for the six months ended June 30, 2020. The following table sets forth total interest expense recognized related to the 2022 Notes (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Contractual interest expense $ — $ 286 $ — $ 768 Amortization of debt discount — 700 — 1,952 Amortization of debt issuance costs — 39 — 111 Total interest expense $ — $ 1,025 $ — $ 2,831 |
Share-based Compensation
Share-based Compensation | 6 Months Ended |
Jun. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-based Compensation | Share-based Compensation The Company included the following amounts for share-based compensation awards in the unaudited condensed consolidated statements of operations (in thousands): Three Months Ended Six Months Ended 2021 2020 2021 2020 Cost of revenues $ 234 $ 759 $ 1,812 $ 987 Research and development 534 1,510 3,762 1,802 Sales and marketing 559 816 2,547 1,279 General and administrative 980 1,343 3,284 1,913 Total 1 $ 2,307 $ 4,428 $ 11,405 $ 5,981 1 During the quarter ended March 31, 2021, the Board of Directors of the Company approved and the Company granted restricted stock units to eligible employees under the 2018 Omnibus Incentive Compensation Plan, previously named the Amended and Restated 2009 Omnibus Incentive Compensation Plan (the “2018 Plan”) that were immediately vested, as fiscal 2020 annual bonus payments. The total charges recorded during the quarter ended March 31, 2021 were $7.0 million. Such bonus payments in fiscal 2020 were paid in the quarter ended June 30, 2020, and total charges related to such bonus payments recorded during the quarter ended June 30, 2020 were $2.7 million. Stock Options The following table summarizes the Company’s stock option activity: Outstanding — December 31, 2020 8,479,979 Granted 1,330,000 Exercised (897,234) Canceled (341,731) Outstanding — June 30, 2021 8,571,014 Exercisable — June 30, 2021 4,596,393 At June 30, 2021, total unrecognized compensation expense related to stock options was $14.1 million, which is expected to be recognized over a weighted-average period of 2.71 years. Restricted Stock Units The following table summarizes the Company’s restricted stock unit (“RSU”) activity: Non-vested — December 31, 2020 417,105 Granted 830,174 Vested (793,227) Forfeited (34,433) Non-vested — June 30, 2021 419,619 At June 30, 2021, total unrecognized compensation expense related to RSUs was $2.1 million, which is expected to be recognized over a weighted-average period of 2.60 years. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per ShareBasic earnings per share (“EPS”) excludes dilution and is computed by dividing net loss attributable to Inseego Corp. by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock using the treasury stock method. Potentially dilutive securities (consisting primarily of the convertible notes calculated using the if-converted method and warrants, stock options and RSUs calculated using the treasury stock method) are excluded from the diluted EPS computation in loss periods and when the applicable exercise price is greater than the market price on the period end date as their effect would be anti-dilutive.For the three months ended June 30, 2021, the computation of diluted EPS excluded 25,831,419 shares related to the convertible notes, stock options and RSUs as their effect would have been anti-dilutive. For the six months ended June 30, 2021, the computation of diluted EPS excluded 25,831,419 shares primarily related to the convertible notes, warrants, stock options and RSUs as their effect would have been anti-dilutive. |
Private Placements and Public O
Private Placements and Public Offering | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Private Placements and Public Offering | Private Placements and Public Offering Common Stock On August 6, 2018, the Company completed a private placement of 12,062,000 shares of common stock, par value $0.001 per share, and warrants to purchase an additional 4,221,700 shares of common stock (the “2018 Warrants”), subject to adjustment for stock splits, reverse stock splits, stock dividends and similar transactions, to certain accredited investors. On March 28, 2019, the 2018 Warrants were exercised at an exercise price of $2.52 per share, for aggregate cash proceeds to the Company of approximately $10.6 million. In connection with the exercise of the 2018 Warrants, on March 28, 2019, the Company issued additional warrants to purchase 2,500,000 shares of common stock (the “2019 Warrants”) to the accredited investors. Each 2019 Warrant has an initial exercise price of $7.00 per share, subject to adjustment for stock splits, reverse stock splits, stock dividends and similar transactions, became exercisable on September 28, 2019, and will expire on June 30, 2022. During the first quarter of 2020, the Company received $1.9 million in net cash proceeds from the exercise of 338,454 of the Company’s common stock purchase warrants issued in 2015. The Company assessed the terms of the warrants under ASC 815. Pursuant to this guidance, the Company has determined that the warrants do not require liability accounting and has classified the warrants as equity. On January 25, 2021, the Company entered into an Equity Distribution Agreement with the Agent, pursuant to which the Company may offer and sell, from time to time, through or to the Agent, up to $40.0 million of shares of its common stock. In January 2021, the Company sold 1,516,073 shares of common stock, at an average price of $20.11 per share, for net proceeds of $29.4 million, after deducting underwriter fees and discounts, and other offering fees, pursuant to the ATM Offering. Preferred Stock On March 6, 2020, the Company issued and sold an additional 25,000 shares of Series E Preferred Stock for an aggregate purchase price of $25.0 million. On March 31, 2020, the Company issued 2,330 shares of Series E Preferred Stock to South Ocean, in satisfaction of certain deferred interest obligations pursuant to the terms and conditions of the Credit Agreement. On May 12, 2020, the Company used a portion of the proceeds from the Offering to repurchase the 2,330 shares of Series E Preferred Stock, which had been issued to satisfy accrued interest under the Credit Agreement, for $2.4 million. |
Geographic Information and Conc
Geographic Information and Concentrations of Risk | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Geographic Information and Concentrations of Risk | Geographic Information and Concentrations of Risk Geographic Information The following table details the Company’s net revenues by geographic region based on shipping destination (in thousands): Three Months Ended Six Months Ended 2021 2020 2021 2020 United States and Canada $ 51,473 $ 69,080 $ 94,209 $ 111,430 South Africa 7,790 5,856 14,898 14,094 Other 6,430 5,753 14,183 12,005 Total $ 65,693 $ 80,689 $ 123,290 $ 137,529 Concentrations of Risk For the three months ended June 30, 2021, two customers accounted for 68.0% of net revenues. For the three months ended June 30, 2020, one customer accounted for 55.6% of net revenues. For the six months ended June 30, 2021, two customers accounted for 65.1% of net revenues. For the six months ended June 30, 2020, one customer accounted for 54.7% of net revenues. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal The Company is, from time to time, party to various legal proceedings arising in the ordinary course of business. For example, the Company is currently named as a defendant or co-defendant in several patent infringement lawsuits in the U.S. and may be required to indirectly participate in other U.S. patent infringement actions pursuant to its contractual indemnification obligations to certain customers. Based on an evaluation of these matters and discussions with the Company’s intellectual property litigation counsel, the Company currently believes that liabilities arising from or sums paid in settlement of these existing matters, if any, would not have a material adverse effect on its condensed consolidated results of operations or financial condition. On May 11, 2017, the Company initiated a lawsuit against the former stockholders of RER in the Court of Chancery of the State of Delaware seeking recovery of damages for civil conspiracy, fraud in the inducement, unjust enrichment and breach of fiduciary duty. On January 16, 2018, the former stockholders of RER filed an answer and counterclaim in the matter seeking recovery of certain deferred and earn-out payments allegedly owed to them by the Company in connection with the Company’s acquisition of RER. On July 26, 2018, the Company and the former stockholders of RER entered into a mutual general release and settlement agreement (the “Settlement Agreement”) pursuant to which the parties agreed to release all claims against each other and the Company agreed to (i) pay the former stockholders of RER $1.0 million in cash by August 17, 2018, (ii) immediately instruct its transfer agent to permit the transfer or sale of 973,333 shares of the Company’s common stock that the Company had issued to the former stockholders of RER in March 2017, (iii) immediately issue 500,000 shares of the Company’s common stock to the former stockholders of RER, (iv) within 12 months following the execution of the Settlement Agreement, deliver to the former stockholders of RER an additional $1.0 million in cash, common stock, or a combination thereof, at the Company’s option, (v) within 24 months following the execution of the Settlement Agreement deliver to the former stockholders of RER an additional $1.0 million in cash, common stock, or a combination thereof, at the Company’s option, and (vi) file one or more registration statements with respect to the resale of the shares of the Company’s common stock issued to the former stockholders of RER pursuant to the Settlement Agreement. On July 24, 2020, the Company issued 89,928 shares of common stock to the former stockholders of RER in satisfaction of all remaining liabilities under the Settlement Agreement. Indemnification In the normal course of business, the Company periodically enters into agreements that require the Company to indemnify and defend its customers for, among other things, claims alleging that the Company’s products infringe third-party patents or other intellectual property rights. The Company’s maximum exposure under these indemnification provisions cannot be estimated but the Company does not believe that there are any matters individually or collectively that would have a material adverse effect on its condensed consolidated results of operations or financial condition. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Leases | Leases Lessee The Company is a lessee in lease agreements for office space, automobiles and certain equipment. Certain of the Company’s leases contain provisions that provide for one or more options to renew at the Company’s sole discretion. The majority of the Company’s leases are comprised of fixed lease payments, with a small percentage of its real estate leases including lease payments subject to a rate or index, which may be variable. Certain real estate leases also include executory costs such as common area maintenance (non-lease component). As a practical expedient permitted under the new guidance, ASC 842 Leases, (“ASC 842”), the Company has elected to account for the lease and non-lease components as a single lease component. Lease payments, which may include lease components and non-lease components, are included in the measurement of the Company’s lease liabilities to the extent that such payments are either fixed amounts or variable amounts based on a rate or index (fixed in substance) as stipulated in the lease contract. None of the Company’s lease agreements contain any material residual value guarantees or material restrictive covenants. As a result of the Company’s election of the package of practical expedients permitted within ASC 842, which among other things, allows for the carryforward of historical lease classification, all of the Company’s lease agreements in existence at the date of adoption that were classified as operating leases under the legacy guidance, ASC 840, have been classified as operating leases under ASC 842. Lease expense for payments related to the Company’s operating leases is recognized on a straight-line basis over the related lease term, which includes options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Right-of-use assets represent the Company’s right to use an underlying asset during the lease term and lease liabilities represent the Company’s obligation to make lease payments as specified in the lease. Right-of-use assets and lease liabilities related to the Company’s operating leases are recognized at the lease commencement date based on the present value of the remaining lease payments over the lease term. When the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available surrounding the Company’s borrowing rates at the lease commencement date in determining the present value of lease payments. The right-of-use asset also includes any lease payments made at or before lease commencement less any lease incentives. As of June 30, 2021, the Company had right-of-use assets of $8.3 million and lease liabilities related to its operating leases of $9.2 million. Right-of-use assets are included in right-of-use assets, net, on the condensed consolidated balance sheet and lease liabilities related to the Company’s operating leases are included in accrued expenses and other liabilities and other long-term liabilities on the condensed consolidated balance sheet. As of June 30, 2021, the Company’s weighted-average remaining lease term and weighted-average discount rate related to its operating leases were 5.5 years and 9.1%, respectively. During the six months ended June 30, 2021 and 2020, the cash paid for amounts included in the measurement of lease liabilities related to the Company’s operating leases was approximately $1.2 million and $0.3 million, respectively, which is included as an operating cash outflow within the consolidated statements of cash flows. During the six months ended June 30, 2021 and 2020, the operating lease costs related to the Company’s operating leases were approxima tely $0.8 million and $0.4 million, respectively, which is included in operating costs and expenses in the condensed consolidated statements of operations. The future minimum payments under operating leases were as follows as of June 30, 2021 (in thousands): 2021 (remainder) $ 1,231 2022 2,282 2023 1,959 2024 1,806 2025 1,652 Thereafter 2,813 Total minimum operating lease payments 11,743 Less: amounts representing interest (2,508) Present value of net minimum operating lease payments 9,235 Less: current portion (1,637) Long-term portion of operating lease obligations $ 7,598 The current and long term portion of operating lease obligations are classified within accrued expenses and other current liabilities and other long-term liabilities, respectively, on the condensed consolidated balance sheets. Lessor Monitoring device leases in which the Company serves as lessor are classified as operating leases. Accordingly, rental devices are carried at historical cost less accumulated depreciation and impairment, if any, and are included in rental assets, net, on the condensed consolidated balance sheets. Since the lease components meet the criteria for an operating lease under ASC 842, the Company has elected the practical expedient to combine the lease and the non-lease components because the service is the predominant element in the eyes of the customer and the pattern of service delivery is the same for both elements. The Company accounts for the combined component as a single performance obligation under ASC 606, Revenue from Contracts with Customers . |
Leases | Leases Lessee The Company is a lessee in lease agreements for office space, automobiles and certain equipment. Certain of the Company’s leases contain provisions that provide for one or more options to renew at the Company’s sole discretion. The majority of the Company’s leases are comprised of fixed lease payments, with a small percentage of its real estate leases including lease payments subject to a rate or index, which may be variable. Certain real estate leases also include executory costs such as common area maintenance (non-lease component). As a practical expedient permitted under the new guidance, ASC 842 Leases, (“ASC 842”), the Company has elected to account for the lease and non-lease components as a single lease component. Lease payments, which may include lease components and non-lease components, are included in the measurement of the Company’s lease liabilities to the extent that such payments are either fixed amounts or variable amounts based on a rate or index (fixed in substance) as stipulated in the lease contract. None of the Company’s lease agreements contain any material residual value guarantees or material restrictive covenants. As a result of the Company’s election of the package of practical expedients permitted within ASC 842, which among other things, allows for the carryforward of historical lease classification, all of the Company’s lease agreements in existence at the date of adoption that were classified as operating leases under the legacy guidance, ASC 840, have been classified as operating leases under ASC 842. Lease expense for payments related to the Company’s operating leases is recognized on a straight-line basis over the related lease term, which includes options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Right-of-use assets represent the Company’s right to use an underlying asset during the lease term and lease liabilities represent the Company’s obligation to make lease payments as specified in the lease. Right-of-use assets and lease liabilities related to the Company’s operating leases are recognized at the lease commencement date based on the present value of the remaining lease payments over the lease term. When the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available surrounding the Company’s borrowing rates at the lease commencement date in determining the present value of lease payments. The right-of-use asset also includes any lease payments made at or before lease commencement less any lease incentives. As of June 30, 2021, the Company had right-of-use assets of $8.3 million and lease liabilities related to its operating leases of $9.2 million. Right-of-use assets are included in right-of-use assets, net, on the condensed consolidated balance sheet and lease liabilities related to the Company’s operating leases are included in accrued expenses and other liabilities and other long-term liabilities on the condensed consolidated balance sheet. As of June 30, 2021, the Company’s weighted-average remaining lease term and weighted-average discount rate related to its operating leases were 5.5 years and 9.1%, respectively. During the six months ended June 30, 2021 and 2020, the cash paid for amounts included in the measurement of lease liabilities related to the Company’s operating leases was approximately $1.2 million and $0.3 million, respectively, which is included as an operating cash outflow within the consolidated statements of cash flows. During the six months ended June 30, 2021 and 2020, the operating lease costs related to the Company’s operating leases were approxima tely $0.8 million and $0.4 million, respectively, which is included in operating costs and expenses in the condensed consolidated statements of operations. The future minimum payments under operating leases were as follows as of June 30, 2021 (in thousands): 2021 (remainder) $ 1,231 2022 2,282 2023 1,959 2024 1,806 2025 1,652 Thereafter 2,813 Total minimum operating lease payments 11,743 Less: amounts representing interest (2,508) Present value of net minimum operating lease payments 9,235 Less: current portion (1,637) Long-term portion of operating lease obligations $ 7,598 The current and long term portion of operating lease obligations are classified within accrued expenses and other current liabilities and other long-term liabilities, respectively, on the condensed consolidated balance sheets. Lessor Monitoring device leases in which the Company serves as lessor are classified as operating leases. Accordingly, rental devices are carried at historical cost less accumulated depreciation and impairment, if any, and are included in rental assets, net, on the condensed consolidated balance sheets. Since the lease components meet the criteria for an operating lease under ASC 842, the Company has elected the practical expedient to combine the lease and the non-lease components because the service is the predominant element in the eyes of the customer and the pattern of service delivery is the same for both elements. The Company accounts for the combined component as a single performance obligation under ASC 606, Revenue from Contracts with Customers . |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s income tax provision (benefit) of $0.2 million a nd $(0.1) million for the three months ended June 30, 2021 and 2020, respectively, and $0.4 million and $(24,000) for the six months ended June 30, 2021 and 2020, respectively, consisted primarily of foreign income taxes at certain of the Company’s international entities and minimum state taxes for its U.S.-based entities. The Company’s income tax expense is different than the expected expense based on statutory rates primarily due to full valuation allowances at all of its U.S.-based entities and many of its foreign subsidiaries. |
Subsequent Event
Subsequent Event | 6 Months Ended |
Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent EventsOn July 30, 2021, the Company completed the sale of Ctrack South Africa. Initial cash proceeds of approximately $36.6 million million were received. Final cash proceeds net of transaction cost are subject to foreign exchange rates as well as certain post-closing working capital adjustments that will be provided by Convergence and agreed upon by the Company no later than 35 business days after completion of the sale. The estimated gain upon sale is approximately $4.4 million, calculated based on the foreign exchange rate as of July 30, 2021, The actual gain could differ from this estimate as a result of post-closing working capital adjustments and related foreign exchange fluctuations. Such gain will be recognized as other income, net in the condensed consolidated results of operations during the three months ended September 30, 2021. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The information contained herein has been prepared by Inseego Corp. (the “Company”) in accordance with the rules of the Securities and Exchange Commission (the “SEC”). The information at June 30, 2021 and the results of the Company’s operations for the three and six months ended June 30, 2021 and 2020 are unaudited. The condensed consolidated financial statements reflect all adjustments, consisting of only normal recurring accruals, except otherwise disclosed herein, which are, in the opinion of management, necessary for a fair statement of the results of the interim periods presented. These unaudited condensed consolidated financial statements and notes hereto should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The year-end condensed consolidated balance sheet data as of December 31, 2020 was derived from the Company’s audited consolidated financial statements and may not include all disclosures required by accounting principles generally accepted in the United States. Certain prior period amounts were reclassified to conform to the current period presentation. These reclassifications did not affect total revenues, costs and expenses, net loss, assets, liabilities or stockholders’ deficit. Except as set forth below, the accounting policies used in preparing these unaudited condensed consolidated financial statements are the same as those described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The results of operations for the interim periods presented are not necessarily indicative of results to be expected for any other interim period or for the year as a whole. |
Principles of Consolidation | Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly- and majority-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Segment Information | Segment InformationManagement has determined that the Company has one reportable segment. The Chief Executive Officer, who is also the Chief Operating Decision Maker, does not manage any part of the Company separately, and the allocation of resources and assessment of performance is based solely on the Company’s consolidated operations and operating results. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent liabilities. Actual results could differ materially from these estimates. Significant estimates include revenue recognition, capitalized software costs, allowance for doubtful accounts receivable, provision for excess and obsolete inventory, valuation of intangible and long-lived assets, valuation of goodwill, valuation of derivatives, accruals relating to litigation, income taxes and share-based compensation expense. The inputs related to certain estimates include consideration of the economic impact of the COVID-19 pandemic. As the impact of the COVID-19 pandemic continues to develop, these estimates could carry a higher degree of variability and volatility, and may change materially in future periods. |
Sources of Revenue | Sources of Revenue The Company generates revenue from a broad range of product sales including intelligent wireless hardware products for the worldwide mobile communications, and industrial Internet of Things (“IIoT”) markets, Inseego Subscribe TM , a hosted SaaS platform that helps organizations manage the selection, deployment and spend of wireless assets, and various Software as a Service (“SaaS”) products. The Company’s products principally include intelligent mobile hotspots, wireless routers for IoT applications, USB modems, integrated telematics and mobile tracking hardware devices, which are supported by applications software and cloud software services designed to enable customers to easily analyze data insights and configure and manage their hardware. The Company classifies its revenues from the sale of its products and services into two distinct groupings, specifically IoT & Mobile Solutions and Enterprise SaaS Solutions. Both IoT & Mobile Solutions and Enterprise SaaS Solutions revenues include any hardware and software required for the respective solution. IoT & Mobile Solutions . The IoT & Mobile Solutions portfolio is comprised of end-to-end edge to cloud solutions including 4G LTE mobile broadband gateways, routers, modems, hotspots, HD quality VoLTE based wireless home phones, cloud management software and an advanced portfolio of 5G products. The solutions are offered under the MiFi™ brand for consumer and enterprise markets, and under the Skyus brand for IIoT markets. Effective in the third quarter ended on September 30, 2020, IoT & Mobile Solutions also includes the Company’s Device Management System (“DMS”), rebranded as Inseego Subscribe TM , that helps organizations manage the selection, deployment and spend of their customer’s wireless assets, helping them save money on personnel and telecom expenses. The Company reclassified its Inseego Subscribe revenue stream from Enterprise SaaS Solutions to better reflect the Company's end user delineation. This reclassification had no impact on previously reported total net revenue, gross profit, or net loss. |
Reclassification | Reclassification Certain reclassifications have been made to the prior period condensed consolidated statement of operations to conform to the current period presentation. |
Fair Value Measurement | Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). A fair value measurement reflects the assumptions market participants would use in pricing an asset or liability based on the best available information. These assumptions include the risk inherent in a particular valuation technique (such as a pricing model) and the risks inherent in the inputs to the model. The Company classifies inputs to measure fair value using a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. The categorization of financial instruments within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy is prioritized into three levels (with Level 3 being the lowest) and is defined as follows: Level 1: Pricing inputs are based on quoted market prices for identical assets or liabilities in active markets (e.g., NYSE or NASDAQ). Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Pricing inputs include benchmark yields, trade data, reported trades and broker dealer quotes, two-sided markets and industry and economic events, yield to maturity, Municipal Securities Rule Making Board reported trades and vendor trading platform data. Level 2 includes those financial instruments that are valued using various pricing services and broker pricing information including Electronic Communication Networks and broker feeds. Level 3: Pricing inputs include significant inputs that are generally less observable from objective sources, including the Company’s own assumptions. The fair market value for level 3 securities may be highly sensitive to the use of unobservable inputs and subjective assumptions. Generally, changes in significant unobservable inputs may result in significantly lower or higher fair value measurements. |
Financial Statement Details (Ta
Financial Statement Details (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Inventories | Inventories, net, consist of the following (in thousands): June 30, December 31, Finished goods $ 24,881 $ 27,009 Raw materials and components 2,663 6,943 Total inventories 1 $ 27,544 $ 33,952 1 Amounts exclude balances classified as held for sale. See Note 4. Business Divestiture. |
Summary of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consist of the following (in thousands): June 30, December 31, Royalties $ 1,932 $ 2,410 Payroll and related expenses 9,063 6,006 Professional fees 766 921 Accrued interest 852 888 Deferred revenue 3,398 2,853 Operating lease liabilities 1,637 1,619 Accrued production costs 901 938 Liabilities related to financed assets 490 1,198 Other 3,835 6,540 Total accrued expenses and other current liabilities 1 $ 22,874 $ 23,373 1 Amounts exclude balances classified as held for sale. See Note 4. Business Divestiture. |
Fair Value Measurement of Ass_2
Fair Value Measurement of Assets and Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments Measured at Fair Value on Recurring Basis | The following tables summarize the Company’s financial instruments measured at fair value on a recurring basis in accordance with the authoritative guidance for fair value measurements as of June 30, 2021 and December 31, 2020 (in thousands): June 30, 2021 December 31, 2020 Total Fair Value Level 3 Level 1 Total Fair Value Level 3 Level 1 Assets Cash equivalents Money market funds $ 126 $ — $ 126 $ 126 $ — $ 126 Total assets $ 126 $ — $ 126 $ 126 $ — $ 126 Liabilities 2025 Notes Interest make-whole payment $ 2,929 $ 2,929 $ — $ 4,898 $ 4,898 $ — Total liabilities $ 2,929 $ 2,929 $ — $ 4,898 $ 4,898 $ — |
Schedule of Fair Value Valuation Model and Assumptions | The fair value of the interest make-whole payment derivative liability was determined using a Monte Carlo model with the following key assumptions: June 30, 2021 December 31, 2020 Volatility 50 % 50 % Stock price $10.09 per share $15.47 per share Credit spread 15.56 % 19.25 % Term 3.84 years 4.34 years Dividend yield — % — % Risk-free rate 0.63 % 0.30 % |
Summary of Changes in Fair Value of Level 3 Liabilities | The following table sets forth a summary of changes in the fair value of Level 3 liabilities for the six months ended June 30, 2021 (in thousands): Balance as of Additions Conversions Change in fair value Balance as of Liabilities: Interest make-whole payment $ 4,898 $ — $ (146) $ (1,823) $ 2,929 |
Business Divestiture (Tables)
Business Divestiture (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Assets and Liabilities HFS | The following table presents assets and liabilities of Ctrack South Africa which are classified as HFS as of June 30, 2021 (in thousands): Balance as of Assets : Cash and cash equivalents $ 5,849 Accounts receivable, net 3,640 Inventory 3,650 Prepaid expenses and other 798 Property, plant and equipment, net 4,197 Rental assets, net 2,392 Intangible assets, net 11,010 Goodwill 10,914 Total assets held for sale $ 42,450 Liabilities: Accounts payable $ 5,302 Accrued expenses and other liabilities 1,294 Deferred tax liabilities, net 3,717 Other long-term liabilities 819 Total liabilities related to assets held for sale $ 11,132 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Net Carrying Amount of Debt | The 2025 Notes consist of the following (in thousands): June 30, December 31, Liability component Principal $ 161,898 $ 166,898 Add: fair value of embedded derivative 2,929 4,898 Less: unamortized debt discount (3,178) (3,703) Less: unamortized issuance costs (2,529) (2,946) Net carrying amount $ 159,120 $ 165,147 |
Schedule of Interest Expense | The following table sets forth total interest expense recognized related to the Term Loan (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Contractual interest expense $ — $ 516 $ — $ 1,667 Amortization of debt discount — 526 — 859 Amortization of debt issuance costs — 63 — 103 Total interest expense $ — $ 1,105 $ — $ 2,629 Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Contractual interest expense $ 1,315 $ 800 $ 2,584 $ 800 Amortization of debt discount 207 124 415 124 Amortization of debt issuance costs 165 96 330 96 Total interest expense $ 1,687 $ 1,020 $ 3,329 $ 1,020 Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Contractual interest expense $ — $ 286 $ — $ 768 Amortization of debt discount — 700 — 1,952 Amortization of debt issuance costs — 39 — 111 Total interest expense $ — $ 1,025 $ — $ 2,831 |
Share-based Compensation (Table
Share-based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation | The Company included the following amounts for share-based compensation awards in the unaudited condensed consolidated statements of operations (in thousands): Three Months Ended Six Months Ended 2021 2020 2021 2020 Cost of revenues $ 234 $ 759 $ 1,812 $ 987 Research and development 534 1,510 3,762 1,802 Sales and marketing 559 816 2,547 1,279 General and administrative 980 1,343 3,284 1,913 Total 1 $ 2,307 $ 4,428 $ 11,405 $ 5,981 |
Summary of Stock Option Activity | The following table summarizes the Company’s stock option activity: Outstanding — December 31, 2020 8,479,979 Granted 1,330,000 Exercised (897,234) Canceled (341,731) Outstanding — June 30, 2021 8,571,014 Exercisable — June 30, 2021 4,596,393 |
Summary of Restricted Stock Unit Activity | The following table summarizes the Company’s restricted stock unit (“RSU”) activity: Non-vested — December 31, 2020 417,105 Granted 830,174 Vested (793,227) Forfeited (34,433) Non-vested — June 30, 2021 419,619 |
Geographic Information and Co_2
Geographic Information and Concentrations of Risk (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Geographic Concentration of Net Revenues | The following table details the Company’s net revenues by geographic region based on shipping destination (in thousands): Three Months Ended Six Months Ended 2021 2020 2021 2020 United States and Canada $ 51,473 $ 69,080 $ 94,209 $ 111,430 South Africa 7,790 5,856 14,898 14,094 Other 6,430 5,753 14,183 12,005 Total $ 65,693 $ 80,689 $ 123,290 $ 137,529 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Schedule of Future Minimum Payments Under Operating Leases | The future minimum payments under operating leases were as follows as of June 30, 2021 (in thousands): 2021 (remainder) $ 1,231 2022 2,282 2023 1,959 2024 1,806 2025 1,652 Thereafter 2,813 Total minimum operating lease payments 11,743 Less: amounts representing interest (2,508) Present value of net minimum operating lease payments 9,235 Less: current portion (1,637) Long-term portion of operating lease obligations $ 7,598 |
Basis of Presentation (Details)
Basis of Presentation (Details) $ / shares in Units, $ in Thousands | Jul. 22, 2020USD ($) | May 12, 2020USD ($) | Mar. 06, 2020USD ($)$ / sharesshares | Jan. 31, 2021USD ($)$ / sharesshares | Mar. 31, 2021USD ($)shares | Sep. 30, 2020USD ($)shares | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($)shares | Jun. 30, 2021USD ($)segment$ / shares | Jun. 30, 2020USD ($) | Jul. 30, 2021USD ($) | Jan. 25, 2021USD ($) | Dec. 31, 2020USD ($)$ / shares |
Class of Stock [Line Items] | |||||||||||||
Cash and cash equivalents, including cash and cash equivalents held for sale | $ 36,700 | ||||||||||||
Working capital | $ 32,400 | ||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |||||||||||
Preferred stock issued during the period | $ 0 | $ 25,000 | |||||||||||
2022 Notes conversion to equity | 0 | 59,907 | |||||||||||
Gross proceeds from the issuance of 2025 Notes | 0 | 100,000 | |||||||||||
Cash paid in exchange transaction | $ 32,000 | $ 32,000 | $ 0 | $ 32,062 | |||||||||
Conversion number of shares | shares | 1,177,156 | ||||||||||||
Number of shares issued (in shares) | shares | 1,516,073 | ||||||||||||
Purchase price (in dollars per share) | $ / shares | $ 20.11 | ||||||||||||
Proceeds from sale of stock | $ 29,400 | ||||||||||||
Offering costs | $ 900 | ||||||||||||
Number of reportable segments | segment | 1 | ||||||||||||
Held-for-sale | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Cash and cash equivalents held for sale | $ 5,800 | ||||||||||||
Held-for-sale | Ctrack South Africa | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Cash and cash equivalents held for sale | 5,849 | ||||||||||||
Disposed of by sale | Ctrack South Africa | Subsequent event | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Initial cash proceeds | $ 36,600 | ||||||||||||
Canaccord Genuity LLC | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Equity Distribution Agreement, maximum aggregate amount authorized for offer or sale | $ 40,000 | ||||||||||||
2025 Notes | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Debt conversion amount | $ 5,000 | ||||||||||||
Value of converted amount | $ 13,500 | 5,000 | |||||||||||
Conversion number of shares | shares | 428,669 | ||||||||||||
Convertible Debt | 2022 Notes | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
2022 Notes conversion to equity | $ 59,900 | ||||||||||||
Stated interest rate (percent) | 5.5 | ||||||||||||
Debt conversion amount | $ 2 | 45,000 | 2 | $ 45,000 | $ 59,900 | ||||||||
Carrying amount of debt | 45,000 | $ 2 | |||||||||||
Conversion number of shares | shares | 13,688,876 | ||||||||||||
Convertible Debt | 2025 Notes | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Stated interest rate (percent) | 3.25 | ||||||||||||
Gross proceeds from the issuance of 2025 Notes | $ 100,000 | ||||||||||||
Carrying amount of debt | 180,400 | $ 161,898 | $ 166,898 | ||||||||||
Debt issued in exchange transaction | $ 80,400 | $ 80,400 | |||||||||||
Series E preferred stock | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Issuance of shares (shares) | shares | 25,000 | ||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||
Preferred stock issued during the period | $ 25,000 |
Financial Statement Details - I
Financial Statement Details - Inventories, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Finished goods | $ 24,881 | $ 27,009 |
Raw materials and components | 2,663 | 6,943 |
Total inventories | $ 27,544 | $ 33,952 |
Financial Statement Details - A
Financial Statement Details - Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Royalties | $ 1,932 | $ 2,410 |
Payroll and related expenses | 9,063 | 6,006 |
Professional fees | 766 | 921 |
Accrued interest | 852 | 888 |
Deferred revenue | 3,398 | 2,853 |
Operating lease liabilities | 1,637 | 1,619 |
Accrued production costs | 901 | 938 |
Liabilities related to financed assets | 490 | 1,198 |
Other | 3,835 | 6,540 |
Total accrued expenses and other current liabilities | $ 22,874 | $ 23,373 |
Fair Value Measurement of Ass_3
Fair Value Measurement of Assets and Liabilities - Financial Instruments Measured at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 | May 12, 2020 |
Liabilities | |||
Interest make-whole payment | $ 2,900 | $ 4,600 | |
Recurring | |||
Assets | |||
Total assets | 126 | $ 126 | |
Liabilities | |||
Total liabilities | 2,929 | 4,898 | |
Recurring | Interest make-whole provision | |||
Liabilities | |||
Interest make-whole payment | 2,929 | 4,898 | |
Recurring | Money market funds | |||
Assets | |||
Money market funds | 126 | 126 | |
Recurring | Level 1 | |||
Assets | |||
Total assets | 126 | 126 | |
Liabilities | |||
Total liabilities | 0 | 0 | |
Recurring | Level 1 | Interest make-whole provision | |||
Liabilities | |||
Interest make-whole payment | 0 | 0 | |
Recurring | Level 1 | Money market funds | |||
Assets | |||
Money market funds | 126 | 126 | |
Recurring | Level 3 | |||
Assets | |||
Total assets | 0 | 0 | |
Liabilities | |||
Total liabilities | 2,929 | 4,898 | |
Recurring | Level 3 | Interest make-whole provision | |||
Liabilities | |||
Interest make-whole payment | 2,929 | 4,898 | |
Recurring | Level 3 | Money market funds | |||
Assets | |||
Money market funds | $ 0 | $ 0 |
Fair Value Measurement of Ass_4
Fair Value Measurement of Assets and Liabilities - Binomial Lattice Model and Assumptions (Details) - Level 3 - Interest make-whole payment | Jun. 30, 2020 | May 12, 2020 | Jun. 30, 2021$ / shares | Dec. 31, 2020$ / shares |
Volatility | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Measurement input | 0.50 | 0.50 | ||
Stock price | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Stock price | $ 10.09 | $ 15.47 | ||
Credit spread | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Measurement input | 0.1925 | 0.1556 | ||
Term | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Term | 3 years 10 months 2 days | 4 years 4 months 2 days | ||
Dividend yield | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Measurement input | 0 | 0 | ||
Risk-free rate | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Measurement input | 0.0030 | 0.0063 |
Fair Value Measurement of Ass_5
Fair Value Measurement of Assets and Liabilities - Activity in Level 3 Liabilities (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2021USD ($) | |
Level 3 Liabilities | |
Beginning balance | $ 4,898 |
Additions | 0 |
Conversions | (146) |
Change in fair value | (1,823) |
Ending balance | $ 2,929 |
Fair Value Measurement of Ass_6
Fair Value Measurement of Assets and Liabilities - Other Financial Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | Dec. 31, 2020 | May 12, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Interest make-whole payment | $ 2,900 | $ 2,900 | $ 4,600 | ||
Loss on change in fair value of embedded derivative | 100 | ||||
Derivative liability extinguished upon debt conversion | 100 | ||||
Gain on change in fair value of embedded derivative | 1,800 | ||||
2025 Notes | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Value of converted amount | $ 13,500 | 5,000 | |||
2025 Notes | Convertible Debt | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Carrying amount of debt | 161,898 | 161,898 | $ 166,898 | $ 180,400 | |
Interest make-whole payment | $ 2,929 | $ 2,929 | $ 4,898 |
Business Divestiture - Narrativ
Business Divestiture - Narrative (Details) - Feb. 24, 2021 R in Millions, $ in Millions | ZAR (R) | USD ($) |
Convergence Partners | Ctrack South Africa | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Purchase Agreement, transaction price per agreement | R 528.9 | $ 36.6 |
Business Divestiture - Assets a
Business Divestiture - Assets and Liabilities Held for Sale (Details) - Held-for-sale $ in Thousands | Jun. 30, 2021USD ($) |
Assets: | |
Cash and cash equivalents | $ 5,800 |
Ctrack South Africa | |
Assets: | |
Cash and cash equivalents | 5,849 |
Accounts receivable, net | 3,640 |
Inventory | 3,650 |
Prepaid expenses and other | 798 |
Property, plant and equipment, net | 4,197 |
Rental assets, net | 2,392 |
Intangible assets, net | 11,010 |
Goodwill | 10,914 |
Total assets held for sale | 42,450 |
Liabilities: | |
Accounts payable | 5,302 |
Accrued expenses and other liabilities | 1,294 |
Deferred tax liabilities, net | 3,717 |
Other long-term liabilities | 819 |
Total liabilities related to assets held for sale | $ 11,132 |
Debt - Term Loan (Details)
Debt - Term Loan (Details) - USD ($) $ in Thousands | May 12, 2020 | Mar. 31, 2020 | Mar. 06, 2020 | Aug. 23, 2017 | Jun. 30, 2021 | Jun. 30, 2020 | Jan. 09, 2017 |
Debt Instrument [Line Items] | |||||||
Payments repurchase of preferred stock | $ 0 | $ 2,354 | |||||
Series E preferred stock | |||||||
Debt Instrument [Line Items] | |||||||
Issuance of shares (shares) | 25,000 | ||||||
Stock repurchased (in shares) | 2,330 | ||||||
Payments repurchase of preferred stock | $ 2,400 | ||||||
South Ocean Funding LLC | Series E preferred stock | |||||||
Debt Instrument [Line Items] | |||||||
Issuance of shares (shares) | 2,330 | ||||||
Secured Debt | Term Loan | |||||||
Debt Instrument [Line Items] | |||||||
Debt aggregate face amount | $ 48,000 | ||||||
Repayment of outstanding principal | 47,500 | ||||||
Repayment of accrued interest | 500 | ||||||
Prepayment fee | $ 1,400 | ||||||
Interest rate base minimum (percent) | 1.00% | ||||||
Effective interest rate | 15.19% | ||||||
Secured Debt | Term Loan | LIBOR | |||||||
Debt Instrument [Line Items] | |||||||
Applicable margin on interest rate (percent) | 7.625% | ||||||
Convertible Debt | 2022 Notes | |||||||
Debt Instrument [Line Items] | |||||||
Debt aggregate face amount | $ 119,800 | ||||||
Effective interest rate | 12.89% | ||||||
Convertible Debt | 2025 Notes | |||||||
Debt Instrument [Line Items] | |||||||
Effective interest rate | 4.16% |
Debt - Components (Details)
Debt - Components (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 | May 12, 2020 |
Debt Instrument [Line Items] | |||
Interest make-whole payment | $ 2,900 | $ 4,600 | |
2025 Notes | Convertible Debt | |||
Debt Instrument [Line Items] | |||
Principal amount | 161,898 | $ 166,898 | $ 180,400 |
Interest make-whole payment | 2,929 | 4,898 | |
Unamortized debt discount | (3,178) | (3,703) | |
Unamortized issuance costs | (2,529) | (2,946) | |
Net carrying amount | $ 159,120 | $ 165,147 |
Debt - Interest Expense (Detail
Debt - Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Term Loan | Secured Debt | ||||
Debt Instrument [Line Items] | ||||
Contractual interest expense | $ 0 | $ 516 | $ 0 | $ 1,667 |
Amortization of debt discount | 0 | 526 | 0 | 859 |
Amortization of debt issuance costs | 0 | 63 | 0 | 103 |
Total interest expense | 0 | 1,105 | 0 | 2,629 |
2025 Notes | Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Contractual interest expense | 1,315 | 800 | 2,584 | 800 |
Amortization of debt discount | 207 | 124 | 415 | 124 |
Amortization of debt issuance costs | 165 | 96 | 330 | 96 |
Total interest expense | 1,687 | 1,020 | 3,329 | 1,020 |
2022 Notes | Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Contractual interest expense | 0 | 286 | 0 | 768 |
Amortization of debt discount | 0 | 700 | 0 | 1,952 |
Amortization of debt issuance costs | 0 | 39 | 0 | 111 |
Total interest expense | $ 0 | $ 1,025 | $ 0 | $ 2,831 |
Debt - Convertible Notes (Detai
Debt - Convertible Notes (Details) | Jul. 22, 2020USD ($) | May 12, 2020USD ($) | Jun. 30, 2021USD ($)$ / shares | Mar. 31, 2021USD ($)shares | Sep. 30, 2020USD ($)shares | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($)shares | Jun. 30, 2021USD ($)trading_day$ / shares | Jun. 30, 2020USD ($) | Dec. 31, 2020USD ($) | Jan. 09, 2017USD ($) |
Debt Instrument [Line Items] | |||||||||||
Proceeds from completed registered offering | $ 0 | $ 100,000,000 | |||||||||
Cash paid in exchange transaction | $ 32,000,000 | $ 32,000,000 | 0 | 32,062,000 | |||||||
Loss on debt conversion and extinguishment | $ 0 | 67,241,000 | 432,000 | 75,174,000 | |||||||
Conversion (shares) | shares | 1,177,156 | ||||||||||
2025 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Loss on debt conversion and extinguishment | $ 400,000 | ||||||||||
Debt conversion amount | $ 5,000,000 | ||||||||||
Conversion (shares) | shares | 428,669 | ||||||||||
Shares in satisfaction of make-whole payment (shares) | shares | 32,221 | ||||||||||
Value of converted amount | $ 13,500,000 | 5,000,000 | |||||||||
2022 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Loss on debt conversion and extinguishment | 67,200,000 | ||||||||||
Convertible Debt | 2025 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Proceeds from completed registered offering | 100,000,000 | ||||||||||
Principal amount | 180,400,000 | $ 161,898,000 | $ 161,898,000 | $ 166,898,000 | |||||||
Debt issued in exchange transaction | 80,400,000 | 80,400,000 | |||||||||
Stated interest rate of debt issued | 3.25% | 3.25% | |||||||||
Principal amount per note | $ 1,000 | $ 1,000 | |||||||||
Conversion ratio | 79.2896 | ||||||||||
Conversion price ($ per share) | $ / shares | $ 12.61 | $ 12.61 | |||||||||
Threshold percentage of stock price trigger | 130.00% | ||||||||||
Threshold of trading days | trading_day | 20 | ||||||||||
Threshold of consecutive trading days | trading_day | 30 | ||||||||||
Aggregate percentage of holders to declare notes due and payable in default event | 25.00% | ||||||||||
Percentage of principal and accrued interest that may be called in default event | 100.00% | ||||||||||
Percentage of principal and accrued interest that may be called in event of bankruptcy, insolvency or reorganization | 100.00% | ||||||||||
Stock price trigger (in dollars per share) | $ / shares | $ 10.51 | ||||||||||
Interest make-whole payment discount rate | 1.00% | 1.00% | |||||||||
Notes held by related parties | $ 80,400,000 | $ 80,400,000 | |||||||||
Effective interest rate | 4.16% | 4.16% | |||||||||
Interest expense | $ 1,687,000 | 1,020,000 | $ 3,329,000 | $ 1,020,000 | |||||||
Convertible Debt | 2022 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Principal amount | 45,000,000 | 2,000 | |||||||||
Estimated fair value of convertible debt | 112,400,000 | ||||||||||
Debt conversion amount | $ 2,000 | $ 45,000,000 | $ 2,000 | $ 45,000,000 | $ 59,900,000 | ||||||
Conversion (shares) | shares | 13,688,876 | ||||||||||
Effective interest rate | 12.89% | 12.89% | |||||||||
Debt aggregate face amount | $ 119,800,000 | ||||||||||
Interest expense | $ 0 | $ 1,025,000 | $ 0 | $ 2,831,000 | |||||||
Convertible Debt | Privately negotiated exchange agreements | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Loss on debt conversion and extinguishment | $ 7,900,000 | ||||||||||
Conversion (shares) | shares | 942,706 | ||||||||||
Value of converted amount | $ 7,900,000 | ||||||||||
Convertible Debt | Novatel Wireless Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Stated interest rate of debt issued | 5.50% |
Share-based Compensation - Expe
Share-based Compensation - Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Share-based compensation expense | $ 2,307 | $ 4,428 | $ 11,405 | $ 5,981 | |
Cost of net revenues | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Share-based compensation expense | 234 | 759 | 1,812 | 987 | |
Research and development | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Share-based compensation expense | 534 | 1,510 | 3,762 | 1,802 | |
Sales and marketing | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Share-based compensation expense | 559 | 816 | 2,547 | 1,279 | |
General and administrative | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Share-based compensation expense | 980 | 1,343 | 3,284 | $ 1,913 | |
Stock Options | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Unrecognized expense | 14,100 | $ 14,100 | |||
Recognition period | 2 years 8 months 15 days | ||||
RSUs | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Share-based compensation expense | $ 7,000 | $ 2,700 | |||
Unrecognized expense | $ 2,100 | $ 2,100 | |||
Recognition period | 2 years 7 months 6 days |
Share-based Compensation - Acti
Share-based Compensation - Activity (Details) | 6 Months Ended |
Jun. 30, 2021shares | |
Stock Options | |
Outstanding — beginning balance | 8,479,979 |
Granted | 1,330,000 |
Exercised | (897,234) |
Canceled | (341,731) |
Outstanding — ending balance | 8,571,014 |
Exercisable — ending balance | 4,596,393 |
RSUs | |
Restricted Stock Units | |
Non-vested — beginning balance | 417,105 |
Granted | 830,174 |
Vested | (793,227) |
Forfeited | (34,433) |
Non-vested — ending balance | 419,619 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Earnings Per Share [Abstract] | ||
Anti-dilutive shares (in shares) | 25,831,419 | 25,831,419 |
Private Placements and Public_2
Private Placements and Public Offering (Details) - USD ($) $ / shares in Units, $ in Thousands | May 12, 2020 | Mar. 31, 2020 | Mar. 06, 2020 | Mar. 28, 2019 | Aug. 06, 2018 | Jan. 31, 2021 | Mar. 31, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jan. 25, 2021 | Dec. 31, 2020 |
Class of Stock [Line Items] | |||||||||||
Number of shares issued (in shares) | 1,516,073 | ||||||||||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |||||||||
Proceeds from the exercise of warrants | $ 1,900 | $ 0 | $ 1,861 | ||||||||
Exercise of warrants (shares) | 338,454 | ||||||||||
Proceeds from sale of stock | $ 29,400 | ||||||||||
Purchase price (in dollars per share) | $ 20.11 | ||||||||||
Preferred stock issued during the period | 0 | 25,000 | |||||||||
Payments repurchase of preferred stock | $ 0 | $ 2,354 | |||||||||
2018 Warrants | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of shares issued (in shares) | 12,062,000 | ||||||||||
Common stock, par value (in dollars per share) | $ 0.001 | ||||||||||
Number of additional shares from warrants (in shares) | 4,221,700 | ||||||||||
Initial exercise price of warrants (in dollars per share) | $ 2.52 | ||||||||||
Proceeds from the exercise of warrants | $ 10,600 | ||||||||||
2019 Warrants | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of additional shares from warrants (in shares) | 2,500,000 | ||||||||||
Initial exercise price of warrants (in dollars per share) | $ 7 | ||||||||||
Canaccord Genuity LLC | |||||||||||
Class of Stock [Line Items] | |||||||||||
Equity Distribution Agreement, maximum aggregate amount authorized for offer or sale | $ 40,000 | ||||||||||
Series E preferred stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Issuance of shares (shares) | 25,000 | ||||||||||
Preferred stock issued during the period | $ 25,000 | ||||||||||
Stock repurchased (in shares) | 2,330 | ||||||||||
Payments repurchase of preferred stock | $ 2,400 | ||||||||||
Series E preferred stock | South Ocean Funding LLC | |||||||||||
Class of Stock [Line Items] | |||||||||||
Issuance of shares (shares) | 2,330 |
Geographic Information and Co_3
Geographic Information and Concentrations of Risk - Net Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net revenues | $ 65,693 | $ 80,689 | $ 123,290 | $ 137,529 |
United States and Canada | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net revenues | 51,473 | 69,080 | 94,209 | 111,430 |
South Africa | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net revenues | 7,790 | 5,856 | 14,898 | 14,094 |
Other | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net revenues | $ 6,430 | $ 5,753 | $ 14,183 | $ 12,005 |
Geographic Information and Co_4
Geographic Information and Concentrations of Risk - Narrative (Details) - Customer Concentration | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Net Revenues | Customer One and Two | |||||
Segment Reporting Information [Line Items] | |||||
Concentration percentage | 68.00% | 65.10% | |||
Net Revenues | Customer One | |||||
Segment Reporting Information [Line Items] | |||||
Concentration percentage | 55.60% | 54.70% | |||
Accounts Receivable | Customer One | |||||
Segment Reporting Information [Line Items] | |||||
Concentration percentage | 35.60% | 33.30% | |||
Accounts Receivable | Customer Two | |||||
Segment Reporting Information [Line Items] | |||||
Concentration percentage | 12.90% | 17.20% | |||
Accounts Receivable | Vendor One | |||||
Segment Reporting Information [Line Items] | |||||
Concentration percentage | 11.30% |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | Jul. 24, 2020 | Jul. 26, 2018 | Mar. 31, 2017 |
RER | |||
Loss Contingencies [Line Items] | |||
Stock issued for acquisition (shares) | 973,333 | ||
Former stockholders of RER | |||
Loss Contingencies [Line Items] | |||
Amount awarded to other party in settlement | $ 1 | ||
Issuance of common shares in litigation settlement (in shares) | 89,928 | 500,000 | |
Additional amount to be awarded to other party in settlement, within 12 months | $ 1 | ||
Additional amount to be awarded to other party in settlement, within 24 months | $ 1 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Right-of-use assets, net | $ 8,294 | $ 9,092 | |
Operating lease liabilities | $ 9,235 | ||
Weighted-average remaining lease term | 5 years 6 months | ||
Weighted-average discount rate | 9.10% | ||
Operating lease payments | $ 1,200 | $ 300 | |
Operating lease costs | $ 800 | $ 400 |
Leases - Maturity of Operating
Leases - Maturity of Operating Lease Liability (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
2021 (remainder) | $ 1,231 | |
2022 | 2,282 | |
2023 | 1,959 | |
2024 | 1,806 | |
2025 | 1,652 | |
Thereafter | 2,813 | |
Total minimum operating lease payments | 11,743 | |
Less: amounts representing interest | (2,508) | |
Present value of net minimum operating lease payments | 9,235 | |
Less: current portion | (1,637) | $ (1,619) |
Long-term portion of operating lease obligations | $ 7,598 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Income tax provision (benefit) | $ 228 | $ (115) | $ 449 | $ (24) |
Subsequent Event (Details)
Subsequent Event (Details) - Subsequent event - Disposed of by sale - Ctrack South Africa $ in Thousands | Jul. 30, 2021USD ($) |
Subsequent Event [Line Items] | |
Initial cash proceeds | $ 36,600 |
Estimated gain upon sale | $ 4,400 |