Cover Page
Cover Page - shares | 9 Months Ended | |
Dec. 31, 2019 | Jan. 30, 2020 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Dec. 31, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-38312 | |
Entity Registrant Name | 8X8 INC /DE/ | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 77-0142404 | |
Entity Address, Address Line One | 2125 O'Nel Drive | |
Entity Address, City or Town | San Jose | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 95131 | |
City Area Code | 408 | |
Local Phone Number | 727-1885 | |
Title of 12(b) Security | COMMON STOCK, PAR VALUE $.001 PER SHARE | |
Trading Symbol | EGHT | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 102,458,236 | |
Entity Central Index Key | 0001023731 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2019 | Mar. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 184,794 | $ 276,583 |
Restricted cash, current | 3,459 | 0 |
Short-term investments | 30,283 | 69,899 |
Accounts receivable, net | 37,384 | 20,181 |
Deferred sales commission costs | 20,749 | 15,601 |
Other current assets | 25,712 | 15,127 |
Total current assets | 302,381 | 397,391 |
Property and equipment, net | 89,776 | 52,835 |
Operating lease, right-of-use assets | 77,062 | |
Intangible assets, net | 26,455 | 11,680 |
Goodwill | 131,000 | 39,694 |
Long-term investments | 20,126 | 0 |
Restricted cash, non-current | 15,558 | 8,100 |
Deferred sales commission costs, non-current | 48,656 | 33,693 |
Other assets | 21,485 | 2,965 |
Total assets | 732,499 | 546,358 |
Current liabilities: | ||
Accounts payable | 50,334 | 32,280 |
Accrued compensation | 24,392 | 18,437 |
Accrued taxes | 11,670 | 13,862 |
Operating lease liabilities, current | 4,320 | |
Deferred revenue | 7,216 | 3,336 |
Other accrued liabilities | 23,704 | 6,790 |
Total current liabilities | 121,636 | 74,705 |
Operating lease liabilities, non-current | 86,187 | |
Convertible senior notes, net | 287,464 | 216,035 |
Other liabilities, non-current | 17,721 | 6,228 |
Total liabilities | 513,008 | 296,968 |
Commitments and contingencies (Note 8) | ||
Stockholders' equity: | ||
Common stock | 101 | 96 |
Additional paid-in capital | 598,525 | 506,949 |
Accumulated other comprehensive loss | (6,565) | (7,353) |
Accumulated deficit | (372,570) | (250,302) |
Total stockholders' equity | 219,491 | 249,390 |
Total liabilities and stockholders' equity | $ 732,499 | $ 546,358 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Total revenue | $ 118,567 | $ 89,912 | $ 324,759 | $ 258,819 |
Cost of revenue and operating expenses: | ||||
Research and development | 19,870 | 16,886 | 57,635 | 43,999 |
Sales and marketing | 63,099 | 46,276 | 174,593 | 128,451 |
General and administrative | 22,547 | 18,038 | 62,589 | 53,198 |
Total operating expenses | 161,735 | 114,150 | 438,424 | 321,027 |
Loss from operations | (43,168) | (24,238) | (113,665) | (62,208) |
Other (expense) income, net | (3,623) | 579 | (7,919) | 1,933 |
Loss before provision for income taxes | (46,791) | (23,659) | (121,584) | (60,275) |
Provision for income taxes | 280 | 112 | 684 | 333 |
Net loss | $ (47,071) | $ (23,771) | $ (122,268) | $ (60,608) |
Net loss per share: | ||||
Basic and diluted (in dollars per share) | $ (0.47) | $ (0.25) | $ (1.23) | $ (0.64) |
Weighted-average common shares outstanding: | ||||
Basic and diluted (in shares) | 99,922 | 95,370 | 99,082 | 94,093 |
Service | ||||
Total revenue | $ 113,566 | $ 85,911 | $ 310,467 | $ 245,378 |
Cost of revenue and operating expenses: | ||||
Cost of goods and services sold | 49,326 | 27,632 | 124,488 | 78,383 |
Product | ||||
Total revenue | 5,001 | 4,001 | 14,292 | 13,441 |
Cost of revenue and operating expenses: | ||||
Cost of goods and services sold | $ 6,893 | $ 5,318 | $ 19,119 | $ 16,996 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (47,071) | $ (23,771) | $ (122,268) | $ (60,608) |
Other comprehensive income (loss), net of tax | ||||
Unrealized gain (loss) on investments in securities | (12) | (101) | 106 | 160 |
Foreign currency translation adjustment | 4,587 | (549) | 682 | (2,600) |
Comprehensive loss | $ (42,496) | $ (24,421) | $ (121,480) | $ (63,048) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Beginning balance (shares) at Mar. 31, 2018 | 92,847,354 | ||||
Beginning balance at Mar. 31, 2018 | $ 218,774 | $ 93 | $ 425,790 | $ (5,645) | $ (201,464) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under stock plans, less withholding (shares) | 403,377 | ||||
Issuance of common stock under stock plans, less withholding | 777 | 777 | |||
Stock-based compensation expense | 9,304 | 9,304 | |||
Unrealized investment gain | 113 | 113 | |||
Foreign currency translation adjustment | (1,672) | (1,672) | |||
Net loss | (15,355) | (15,355) | |||
Ending balance (shares) at Jun. 30, 2018 | 93,250,731 | ||||
Ending balance at Jun. 30, 2018 | 251,842 | $ 93 | 435,871 | (7,204) | (176,918) |
Beginning balance (shares) at Mar. 31, 2018 | 92,847,354 | ||||
Beginning balance at Mar. 31, 2018 | 218,774 | $ 93 | 425,790 | (5,645) | (201,464) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Foreign currency translation adjustment | (2,600) | ||||
Net loss | (60,608) | ||||
Ending balance (shares) at Dec. 31, 2018 | 95,509,223 | ||||
Ending balance at Dec. 31, 2018 | 227,729 | $ 95 | 457,889 | (8,084) | (222,171) |
Beginning balance (shares) at Jun. 30, 2018 | 93,250,731 | ||||
Beginning balance at Jun. 30, 2018 | 251,842 | $ 93 | 435,871 | (7,204) | (176,918) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under stock plans, less withholding (shares) | 1,840,387 | ||||
Issuance of common stock under stock plans, less withholding | (595) | $ 1 | (596) | ||
Stock-based compensation expense | 9,829 | 9,829 | |||
Unrealized investment gain | 149 | 149 | |||
Foreign currency translation adjustment | (379) | (379) | |||
Net loss | (21,482) | (21,482) | |||
Ending balance (shares) at Sep. 30, 2018 | 95,091,118 | ||||
Ending balance at Sep. 30, 2018 | 239,364 | $ 94 | 445,104 | (7,434) | (198,400) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under stock plans, less withholding (shares) | 418,105 | ||||
Issuance of common stock under stock plans, less withholding | (280) | $ 1 | (281) | ||
Stock-based compensation expense | 13,066 | 13,066 | |||
Unrealized investment gain | (101) | (101) | |||
Foreign currency translation adjustment | (549) | (549) | |||
Net loss | (23,771) | (23,771) | |||
Ending balance (shares) at Dec. 31, 2018 | 95,509,223 | ||||
Ending balance at Dec. 31, 2018 | 227,729 | $ 95 | 457,889 | (8,084) | (222,171) |
Beginning balance (shares) at Mar. 31, 2019 | 96,119,888 | ||||
Beginning balance at Mar. 31, 2019 | 249,390 | $ 96 | 506,949 | (7,353) | (250,302) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under stock plans, less withholding (shares) | 451,308 | ||||
Issuance of common stock under stock plans, less withholding | 1,494 | $ 1 | 1,493 | ||
Stock-based compensation expense | 14,059 | 14,059 | |||
Unrealized investment gain | 121 | 121 | |||
Foreign currency translation adjustment | (652) | (652) | |||
Net loss | (34,265) | (34,265) | |||
Ending balance (shares) at Jun. 30, 2019 | 96,571,196 | ||||
Ending balance at Jun. 30, 2019 | 230,147 | $ 97 | 522,501 | (7,884) | (284,567) |
Beginning balance (shares) at Mar. 31, 2019 | 96,119,888 | ||||
Beginning balance at Mar. 31, 2019 | 249,390 | $ 96 | 506,949 | (7,353) | (250,302) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Foreign currency translation adjustment | 682 | ||||
Net loss | (122,268) | ||||
Ending balance (shares) at Dec. 31, 2019 | 100,784,960 | ||||
Ending balance at Dec. 31, 2019 | 219,491 | $ 101 | 598,525 | (6,565) | (372,570) |
Beginning balance (shares) at Jun. 30, 2019 | 96,571,196 | ||||
Beginning balance at Jun. 30, 2019 | 230,147 | $ 97 | 522,501 | (7,884) | (284,567) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under stock plans, less withholding (shares) | 1,761,483 | ||||
Issuance of common stock under stock plans, less withholding | (788) | $ 2 | (790) | ||
Stock-based compensation expense | 17,867 | 17,867 | |||
Issuance of common stock related to acquisitions (shares) | 1,476,009 | ||||
Issuance of common stock related to acquisitions | 35,839 | $ 1 | 35,838 | ||
Unrealized investment gain | (3) | (3) | |||
Foreign currency translation adjustment | (3,253) | (3,253) | |||
Net loss | (40,932) | (40,932) | |||
Ending balance (shares) at Sep. 30, 2019 | 99,808,688 | ||||
Ending balance at Sep. 30, 2019 | 238,877 | $ 100 | 575,416 | (11,140) | (325,499) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under stock plans, less withholding (shares) | 976,272 | ||||
Issuance of common stock under stock plans, less withholding | 140 | $ 1 | 139 | ||
Stock-based compensation expense | 19,881 | 19,881 | |||
Equity component of convertible senior notes, net of issuance costs | 3,089 | 3,089 | |||
Unrealized investment gain | (12) | (12) | |||
Foreign currency translation adjustment | 4,587 | 4,587 | |||
Net loss | (47,071) | (47,071) | |||
Ending balance (shares) at Dec. 31, 2019 | 100,784,960 | ||||
Ending balance at Dec. 31, 2019 | $ 219,491 | $ 101 | $ 598,525 | $ (6,565) | $ (372,570) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (122,268) | $ (60,608) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 6,801 | 6,464 |
Amortization of intangible assets | 6,149 | 4,551 |
Amortization of capitalized software | 13,263 | 6,452 |
Amortization of debt discount and issuance costs | 9,987 | 0 |
Amortization of deferred sales commission costs | 13,805 | 0 |
Operating lease expense, net of accretion | 10,676 | |
Non-cash lease expenses | 3,601 | |
Stock-based compensation | 50,305 | 31,574 |
Other | 2,671 | 873 |
Changes in assets and liabilities: | ||
Accounts receivable, net | (8,776) | (3,965) |
Deferred sales commission costs | (33,651) | (7,234) |
Other current and non-current assets | (24,780) | (2,565) |
Accounts payable and accruals | 7,876 | 13,198 |
Deferred revenue | 5,106 | 986 |
Net cash used in operating activities | (62,836) | (6,673) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (22,853) | (5,778) |
Purchase of businesses | (58,853) | (5,625) |
Capitalized software development costs | (22,784) | (18,210) |
Proceeds from maturities of investments | 16,195 | 44,850 |
Proceeds from sales of investments | 33,117 | 41,780 |
Purchases of investments | (29,658) | (52,353) |
Net cash (used in) provided by investing activities | (84,836) | 4,664 |
Cash flows from financing activities: | ||
Finance lease payments | (312) | |
Finance lease payments | (771) | |
Tax-related withholding of common stock | (6,186) | (7,631) |
Proceeds from issuance of common stock under employee stock plans | 7,035 | 7,372 |
Net proceeds from issuance of convertible senior notes | 65,305 | 0 |
Net cash provided by (used in) financing activities | 65,842 | (1,030) |
Effect of exchange rate changes on cash | 958 | (339) |
Net decrease in cash and cash equivalents, and restricted cash | (80,872) | (3,378) |
Cash, cash equivalents, and restricted cash at the beginning of the period | 284,683 | 39,803 |
Cash, cash equivalents, and restricted cash at the end of the period | 203,811 | 36,425 |
Supplemental cash flow information | ||
Income taxes paid | 719 | 290 |
Interest paid | 647 | $ 0 |
Right of use assets obtained in exchange for new operating lease liabilities | $ 64,869 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 9 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS | DESCRIPTION OF BUSINESS 8x8, Inc. ("8x8" or the "Company") was incorporated in California in February 1987 and was reincorporated in Delaware in December 1996 . The unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company conducts its operations through one reportable segment. The Company is a leading cloud provider of enterprise Software-as-a-Service ("SaaS") communications solutions, that enable businesses of all sizes to communicate faster and smarter across voice, contact center, video meetings, messaging, and communication APIs, transforming both employee and customer experiences with communications that work simply, integrate seamlessly, and perform reliably. From one proprietary cloud technology platform, customers have access to unified communications, team collaboration, video conferencing, contact center, data and analytics, communication APIs, and other services. Since fiscal 2004, substantially all revenue has been generated from the sale of communications services and related hardware. Prior to fiscal 2003, the Company's main business was Voice over Internet Protocol semiconductors. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF PRESENTATION AND CONSOLIDATION The Company's fiscal year ends on March 31 of each calendar year. Each reference to a fiscal year in these notes to the condensed consolidated financial statements refers to the fiscal year ended March 31 of the calendar year indicated (for example, fiscal 2020 refers to the fiscal year ending March 31, 2020 ). The accompanying interim condensed consolidated financial statements are unaudited and have been prepared on substantially the same basis as our annual consolidated financial statements for the fiscal year ended March 31, 2019 with the exception of new lease accounting guidance discussed in the recently adopted accounting principles section below. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") have been condensed or omitted pursuant to the rules and regulations of the SEC, regarding interim financial reporting. In the opinion of the Company's management, these interim condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of our financial position, results of operations, and cash flows for the periods presented. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. The March 31, 2019 year-end condensed consolidated balance sheet data in this document were derived from audited consolidated financial statements and does not include all of the disclosures required by GAAP. These condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements as of and for the fiscal year ended March 31, 2019 and notes thereto included in the Company's fiscal 2019 Annual Report on Form 10-K. The results of operations and cash flows for the interim periods included in these condensed consolidated financial statements are not necessarily indicative of the results to be expected for any future period or the entire fiscal year. USE OF ESTIMATES The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and equity and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including, but not limited to, those related to bad debts, returns reserve for expected cancellations, fair value of and/or potential impairment of goodwill and intangible assets, capitalization of internally developed software, benefit period for deferred commissions, stock-based compensation, discount rate used to calculate operating lease liabilities, income and sales tax liabilities, convertible senior notes fair value, litigation, and other contingencies. The Company bases its estimates on known facts and circumstances, historical experience, and various other assumptions. Actual results could differ from those estimates under different assumptions or conditions. RECLASSIFICATIONS AND OTHER CHANGES Certain prior year amounts in the statements of cash flows have been reclassified to conform with current year presentation. SIGNIFICANT ACCOUNTING POLICIES The significant accounting policies used in preparation of these condensed consolidated financial statements are disclosed in our Annual Report on Form 10-K for the fiscal year ended March 31, 2019 filed with the SEC on May 21, 2019, and there have been no changes to the Company's significant accounting policies during the three and nine months ended December 31, 2019 except for the accounting policies described below that were updated as a result of adopting Accounting Standards Update ("ASU") 2016-02, Leases . All amounts and disclosures set forth herein are in compliance with this standard. RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS Effective April 1, 2019, the Company adopted ASU No. 2016-02 (“ASU 2016-02”), Leases using the modified retrospective transition approach utilizing the effective date as the date of initial application. ASU 2016-02 establishes a new lease accounting model for leases, which requires lessees to recognize right-of-use assets and lease liabilities on the balance sheet, but lease expense will be recognized on the income statement in a manner similar to previous requirements. Prior years presented have not been adjusted for ASU 2016-02 and continue to be reported in accordance with our historical accounting policy. The new standard provides a number of optional practical expedients in transition. The Company has elected certain practical expedients permitted under the new lease standard, which among other things, allows the carryforward of the historical lease classification. As a result, there was no impact to opening retained earnings. The new standard also provides a practical expedient for an entity’s ongoing accounting. The Company has elected such practical expedient to not separate lease and non-lease components for all leases. It also made an accounting policy election to not recognize right-of-use assets and lease liabilities on the balance sheet for leases with a term of 12 months or less and will recognize lease payments as an expense on a straight-line basis over the lease term. The adoption of the new lease standard resulted in the recognition of right-of-use assets and lease liabilities of approximately $20.0 million and $21.4 million , respectively, for existing operating leases. The Company does not have significant finance lease right-of-use assets or liabilities. The adoption of the new lease standard did not have a material impact on the Company's accumulated deficit as of April 1, 2019. For additional information on leases and the impact of the new lease standard, refer to Note 7. RECENT ACCOUNTING PRONOUNCEMENTS In December 2019, the Financial Accounting Standards Board (the "FASB") issued ASU 2019-02, Income Taxes (Topic 740) , which enhances and simplifies various aspects of the income tax accounting guidance, including requirements such as tax basis step-up in goodwill obtained in a transaction that is not a business combination, ownership changes in investments, and interim-period accounting for enacted changes in tax law. The amendment will be effective for public companies with fiscal years beginning after December 15, 2020, which is fiscal 2022 for the Company; early adoption is permitted. The Company is currently assessing the impact of this pronouncement to its consolidated financial statements. In November 2019, the FASB issued ASU 2019-08, Compensation - Stock Compensation (Topic 718) . The amendment requires that an entity measure and classify share-based payment awards granted to a customer by applying the guidance in Topic 718. The amount recorded as a reduction of the transaction price is required to be measured on the basis of the grant-date fair value of the share-based payment award in accordance with Topic 718. The amendments in this update are effective for fiscal years beginning after December 15, 2019, which is fiscal 2021 for the Company; early adoption is permitted. The Company is currently assessing the impact of this pronouncement to its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) , which makes modifications to disclosure requirements on fair value measurements. The amendment is effective for public companies with fiscal years beginning after December 15, 2019, which is fiscal 2021 for the Company; early adoption is permitted. The Company is currently assessing the impact of this pronouncement to its consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal Use Software (Subtopic 350-40) , which reduces complexity for the accounting for costs of implementing a cloud computing service arrangement. The amendment is effective for public companies with fiscal years beginning after December 15, 2019, which is fiscal 2021 for the Company; early adoption is permitted. The Company is currently assessing the impact of this pronouncement to its consolidated financial statements. In June 2016, the FASB issued ASU 2016‑13, Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments , which changes the impairment model for most financial assets. The new model uses a forward‑looking expected loss method, which will generally result in earlier recognition of allowances for losses. In November 2018, the FASB issued ASU 2018‑19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses , which clarifies that receivables arising from operating leases are not within the scope of Topic 326, Financial Instruments—Credit Losses . Instead, impairment of receivables arising from operating leases should be accounted for in accordance with Topic 842, Leases . In April 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses , Topic 815, Derivatives and Hedging , and Topic 825, Financial Instruments , which clarifies treatment of certain credit losses. In May 2019, the FASB issued ASU 2019-05, Financial Instruments — Credit Losses (Topic 326): Targeted Transition Relief , which permits an entity, upon adoption of ASU 2016-13, to irrevocably elect the fair value option (on an instrument-by-instrument basis) for eligible financial assets measured at amortized cost basis. In November 2019, the FASB issued ASU 2019-11, Codification Improvements to Topic 326, Financial Instruments — Credit Losses , which included various narrow-scope improvements and clarifications. In November 2019, FASB issued ASU No. 2019-10, Financial Instruments — Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) . These ASUs are effective for annual and interim periods beginning after December 15, 2019, which is fiscal 2021 for the Company; early adoption is permitted. The Company is currently assessing the impact of this pronouncement to its consolidated financial statements. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 9 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | REVENUE RECOGNITION Revenue Recognition The Company recognizes service revenue, mainly from subscription services to its cloud-based voice, contact center, video, collaboration and communication APIs solutions using the five-step model as prescribed by ASC 606, Revenue from Contracts with Customers : • Identification of the contract, or contracts, with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when or as the Company satisfies a performance obligation. The Company identifies performance obligations in contracts with customers, which may include subscription services and related usage, products, and professional services. The transaction price is determined based on the amount the Company expects to be entitled to receive in exchange for transferring the promised services or products to the customer. The transaction price in the contract is allocated to each distinct performance obligation in an amount that represents the relative amount of consideration expected to be received in exchange for satisfying each performance obligation. Revenue is recognized when performance obligations are satisfied. Revenues are recorded based on the transaction price, excluding amounts collected on behalf of third parties such as sales and telecommunication taxes, which are collected on behalf of and remitted to governmental authorities. The Company usually bills its customers on a monthly basis. Contracts typically range from annual to multi-year agreements with payment terms of net 30-days or less. The Company occasionally allows a 30-day period to cancel a subscription and return products shipped for a full refund. Judgments and Estimates The estimation of variable consideration for each performance obligation requires the Company to make subjective judgments. The Company has service-level agreements with customers warranting defined levels of uptime reliability and performance. Customers may get credits or refunds if the Company fails to meet such levels. If the services do not meet certain criteria, fees are subject to adjustment or refund representing a form of variable consideration. The Company may impose minimum revenue commitments ("MRC") on its customers at the inception of the contract. Thus, in estimating variable consideration for each of these performance obligations, the Company assesses both the probability of MRC occurring and the collectability of the MRC, of which both represent a form of variable consideration. The Company enters into contracts with customers that regularly include promises to transfer multiple services and products, such as subscriptions, products, and professional services. For arrangements with multiple services, the Company evaluates whether the individual services qualify as distinct performance obligations. In its assessment of whether a service is a distinct performance obligation, the Company determines whether the customer can benefit from the service on its own or with other readily available resources, and whether the service is separately identifiable from other services in the contract. This evaluation requires the Company to assess the nature of each individual service offering and how the services are provided in the context of the contract, including whether the services are significantly integrated, highly interrelated, or significantly modify each other, which may require judgment based on the facts and circumstances of the contract. When agreements involve multiple distinct performance obligations, the Company allocates arrangement consideration to all performance obligations at the inception of an arrangement based on the relative standalone selling prices ("SSP") of each performance obligation. Usage fees deemed to be variable consideration meet the allocation exception for variable consideration. Where the Company has standalone sales data for its performance obligations which are indicative of the price at which the Company sells a promised good or service separately to a customer, such data is used to establish SSP. In instances where standalone sales data is not available for a particular performance obligation, the Company estimates SSP by the use of observable market and cost-based inputs. The Company continues to review the factors used to establish list price and will adjust standalone selling price methodologies as necessary on a prospective basis. Service Revenue Service revenue from subscriptions to the Company's cloud-based technology platform is recognized over time on a ratable basis over the contractual subscription term beginning on the date that the platform is made available to the customer. Payments received in advance of subscription services being rendered are recorded as a deferred revenue. Usage fees from our unified communications as a service ("UCaaS") and contact center as a service ("CCaaS") offerings, either bundled or not bundled, are recognized as revenue when earned. Usage fees for our communication platform as a service ("CPaaS") offerings are typically invoiced monthly in arrears and recognized as revenues when earned. Professional services for configuration, system integration, optimization, customer training or education are primarily billed on a fixed-fee basis and are performed by the Company directly or, alternatively, customers may also choose to perform these services themselves or engage their own third-party service providers. Professional services revenue is recognized over time as the services are rendered. When a contract with a customer is signed, the Company assesses whether collection of the fees under the arrangement is probable. The Company estimates the amount to reserve for uncollectible amounts based on the aging of the contract balance, current and historical customer trends, and communications with its customers. These reserves are recorded as operating expenses against the contract asset (Accounts Receivable). In the normal course of business, the Company records revenue reductions for customer credits. Product Revenue The Company recognizes product revenue for telephony equipment at a point in time, when transfer of control has occurred, which is generally upon shipment. Sales returns are recorded as a reduction to revenue estimated based on historical experience. Contract Assets Contract assets are recorded for those parts of the contract consideration not yet invoiced but for which the performance obligations are completed. The revenue is recognized when the customer receives services or equipment for a reduced consideration at the onset of an arrangement, for example, when the initial month's services or equipment are discounted. Contract assets are included in other current or non-current assets in the condensed consolidated balance sheets, depending on if their reduction will be recognized during the succeeding twelve-month period or beyond. Deferred Revenue Deferred revenues represent billings or payments received in advance of revenue recognition and is recognized upon transfer of control. Balances consist primarily of annual plan subscription services and professional and training services not yet provided as of the balance sheet date. Deferred revenues that will be recognized during the succeeding twelve-month period are recorded as current deferred revenues in the condensed consolidated balance sheets, with the remainder recorded as other non-current liabilities in the condensed consolidated balance sheets. Costs to Obtain a Customer Contract Sales commissions and related expenses are considered incremental and recoverable costs of acquiring customer contracts. These costs are capitalized as current or non-current assets and amortized on a straight-line basis over the anticipated benefit period, which is five years . The benefit period was estimated by taking into consideration the length of customer contracts, technology lifecycle, and other factors. This amortization expense is recorded in sales and marketing expense within the Company's condensed consolidated statement of operations. Disaggregation of Revenue The Company disaggregates its revenue by geographic region. See Note 13 for more information. Contract Balances The following table provides information about receivables, contract assets and deferred revenues from contracts with customers (in thousands): December 31, 2019 Accounts receivable, net $ 37,384 Contract assets - current $ 10,507 Contract assets - non-current $ 8,413 Deferred revenue - current $ 7,216 Deferred revenue - non-current $ 1,411 Changes in the contract assets and the deferred revenue balances during the nine months ended December 31, 2019 are as follows (in thousands): December 31, 2019 March 31, 2019 $ Change Contract assets $ 18,920 $ 5,717 $ 13,203 Deferred revenue $ 8,627 $ 3,342 $ 5,285 The change in contract assets was primarily driven by the recognition of revenue that has not yet been billed, net of amounts billed during the period. The increase in deferred revenues was due to billings in advance of performance obligations being satisfied, net of revenue recognized for services rendered during the period. Revenues of $2.9 million were recognized during the nine months ended December 31, 2019 , of which were included in the deferred revenues balance at the beginning of the period, which was offset by additional deferrals during the period. Remaining Performance Obligations The Company's subscription terms typically range from one to four years . Contract revenue as of December 31, 2019 that has not yet been recognized was approximately $245.0 million . This excludes contracts with an original expected length of one year or less. The Company expects to recognize revenue on most of the remaining performance obligation over the next 36 months . |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Cash, cash equivalents, and available-for-sale investments (in thousands): Amortized Gross Unrealized Gross Unrealized Estimated Cash and Cash Short-Term Long-Term As of December 31, 2019 Costs Gain Loss Fair Value Equivalents Investments Investments Cash $ 22,722 $ — $ — $ 22,722 $ 22,722 $ — $ — Level 1: Money market funds 157,401 — — 157,401 157,401 — — Treasury securities 6,498 13 — 6,511 — — 6,511 Subtotal 186,621 13 — 186,634 180,123 — 6,511 Level 2: Corporate bonds 36,181 93 — 36,274 — 22,659 13,615 Commercial paper 8,835 1 — 8,836 4,671 4,165 — Municipal securities 1,345 — — 1,345 — 1,345 — Agency bonds 2,099 15 — 2,114 — 2,114 — Subtotal 48,460 109 — 48,569 4,671 30,283 13,615 Total assets $ 235,081 $ 122 $ — $ 235,203 $ 184,794 $ 30,283 $ 20,126 Amortized Gross Unrealized Gross Unrealized Estimated Cash and Cash Short-Term As of March 31, 2019 Costs Gain Loss Fair Value Equivalents Investments Cash $ 25,364 $ — $ — $ 25,364 $ 25,364 $ — Level 1: Money market funds 251,219 — — 251,219 251,219 — Subtotal 276,583 — — 276,583 276,583 — Level 2: Corporate debt 46,516 51 (29 ) 46,538 — 46,538 Municipal securities 5,511 17 — 5,528 — 5,528 Asset backed securities 13,596 9 (17 ) 13,588 — 13,588 Agency bonds 4,260 — (15 ) 4,245 — 4,245 Subtotal 69,883 77 (61 ) 69,899 — 69,899 Total assets $ 346,466 $ 77 $ (61 ) $ 346,482 $ 276,583 $ 69,899 Historically, the Company had maintained all investments as short-term investments on its balance sheet, as the Company could liquidate these investments at any time and did not limit its liquidation of investments by contractual maturity date. Given the recent issuance of the convertible senior notes, and the associated increased cash, cash equivalents and investment balances, the Company expects to hold certain investments for at least 12 months from the reporting date and records these investments in long-term investments in accordance with the contractual maturity dates. As of December 31, 2019 , the estimated fair value of the Company's outstanding convertible senior notes ("the Notes") was $362.3 million . The estimated fair value of the Notes was determined based on the closing price for the Notes on the last trading day of the reporting period and is considered as Level 2 in the fair value hierarchy. |
BUSINESS COMBINATIONS
BUSINESS COMBINATIONS | 9 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATIONS | BUSINESS COMBINATIONS Wavecell Acquisition On July 17, 2019, the Company entered into a Share Purchase Agreement (the “Share Purchase Agreement”) with Wavecell Pte. Ltd., a corporation incorporated under the laws of the Republic of Singapore (“Wavecell”), the equity holders of Wavecell (collectively, the “Sellers”), and Qualgro Partners Pte. Ltd., in its capacity as the representative of the equity holders of Wavecell. Pursuant to the Share Purchase Agreement, the Company acquired all of the outstanding shares and other equity interests of Wavecell (the “Transaction”). This Transaction extends 8x8’s technology advantage as a fully-owned, cloud technology platform with UCaaS, CCaaS, video communication as a service ("VCaaS") and CPaaS solutions able to natively offer pre-packaged communications, contact center and video solutions and open APIs to embed these and other communications into an organization’s core business processes. The total fair value of the purchase consideration of approximately $117.1 million was comprised of approximately $72.8 million in cash and $44.3 million in shares of common stock of the Company, of which approximately $10.4 million in cash and $8.5 million in equity have been heldback to cover potential indemnity claims made by the Company after the closing date. One-third of these heldback amounts are eligible to be released in twelve months from the date of the Transaction and the remainder in eighteen months from the date of the Transaction. The heldback cash of $3.5 million and $6.9 million are recorded in restricted cash, current and restricted cash, non-current, respectively and other accrued liabilities and other liabilities, non-current, respectively, in the Company's condensed consolidated balance sheet. The holdback of $8.5 million in equity, of which $2.8 million is included in current other accrued liabilities, and $5.7 million is included in other liabilities, non-current, is reflected in the Company's condensed consolidated balance sheet. Additionally, in connection with the Transaction, the Company issued $13.2 million in time-based restricted stock awards and $6.6 million in performance based restricted stock awards all of which vest over the next three years , and which the Company will expense over the same such period. The major classes of assets and liabilities to which the Company has preliminarily allocated the fair value of purchase consideration were as follows (in thousands): July 17, 2019 Cash $ 4,473 Accounts receivable 9,438 Intangible assets 21,010 Other assets 787 Goodwill 91,060 Accounts payable (9,548 ) Deferred revenue (90 ) Total consideration $ 117,130 The acquisition has been accounted for as a business combination under the acquisition method and, accordingly, the total purchase price is allocated to the tangible and intangible assets acquired and the liabilities assumed based on their estimated fair value on the acquisition date. The fair value of assets acquired and liabilities assumed from the acquisition of Wavecell is based on a preliminary valuation and, as such, the Company's estimates and allocations to certain assets, liabilities, and tax estimates are subject to change within the measurement period as additional information becomes available. The goodwill recognized was primarily attributed to increased synergies that are expected to be achieved from the integration of Wavecell and is not expected to be deductible for income tax purposes. The preliminary value of the acquired intangible assets acquired are as follows (in thousands): Fair Value Useful life (in Years) Trade and domain names $ 990 3 Developed technology 13,830 7 Customer relationships 6,190 7 Total intangible assets $ 21,010 The Company incurred costs related to this acquisition of approximately $1.8 million during the nine months ended December 31, 2019. All acquisition related costs were expensed as incurred and have been recorded in general and administrative expenses in the accompanying consolidated statements of operations. The revenue and earnings of the acquired business have been included in the Company’s results since the acquisition date and are not material to the Company’s condensed consolidated financial results. Pro forma results of operations for this acquisition have not been presented, as the financial impact to the Company’s condensed consolidated financial statements is not material. Jitsi Acquisition On October 29, 2018, the Company entered into an Asset Purchase Agreement with Atlassian Corporation PLC ("Atlassian") through which the Company purchased certain assets from Atlassian. The asset purchase from Atlassian did not contribute materially to revenue or net loss from the date of acquisition to December 31, 2018. |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 9 Months Ended |
Dec. 31, 2019 | |
Intangible Assets, Net (Including Goodwill) [Abstract] | |
INTANGIBLE ASSETS AND GOODWILL | INTANGIBLE ASSETS AND GOODWILL The carrying value of intangible assets consisted of the following (in thousands): December 31, 2019 March 31, 2019 Gross Accumulated Net Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology $ 33,685 $ (14,497 ) $ 19,188 $ 25,702 $ (15,409 ) $ 10,293 Customer relationships 11,601 (5,297 ) 6,304 9,467 (8,080 ) 1,387 Trade and domain names 1,128 (165 ) 963 2,108 (2,108 ) — Total acquired identifiable intangible assets $ 46,414 $ (19,959 ) $ 26,455 $ 37,277 $ (25,597 ) $ 11,680 At December 31, 2019 , annual amortization of intangible assets, based upon our existing intangible assets and current useful lives, is estimated to be the following (in thousands): Amount Remaining 2020 $ 2,326 2021 6,755 2022 4,946 2023 3,162 2024 2,851 Thereafter 6,415 Total $ 26,455 The following table provides a summary of the changes in the carrying amounts of goodwill (in thousands): Total Balance at March 31, 2019 $ 39,694 Additions due to acquisitions 91,060 Foreign currency translation 246 Balance at December 31, 2019 $ 131,000 |
RIGHT-OF-USE ASSETS AND LEASES
RIGHT-OF-USE ASSETS AND LEASES | 9 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
RIGHT-OF-USE ASSETS AND LEASES | RIGHT-OF-USE ASSETS AND LEASES The Company primarily leases facilities for office and data center space under non-cancellable operating leases for its U.S. and international locations that expire at various dates through 2030. For leases with a term greater than 12 months, the Company recognizes a right-of-use asset and a lease liability based on the present value of lease payments over the lease term. Variable lease payments are not included in the lease payments to measure the lease liability and are expensed as incurred. The Company’s leases have remaining terms of one to eleven years and some of the leases include a Company option to extend the lease term for less than twelve months to five years , or more, which if reasonably certain to exercise, the Company includes in the determination of lease payments. The lease agreements do not contain any material residual value guarantees or material restrictive covenants. As most of the Company's leases do not provide a readily determinable implicit rate, the Company uses the incremental borrowing rate at lease commencement, which was determined using a portfolio approach, based on the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. The Company uses the implicit rate when a rate is readily determinable. Operating lease expense is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recognized on the balance sheet and the expense for these short-term leases is recognized on a straight-line basis over the lease term. Common area maintenance fees (or CAMs) and other charges related to these leases continue to be expensed as incurred. The following table provides balance sheet information related to leases as of December 31, 2019 (in thousands): December 31, 2019 Assets Operating lease, right-of-use assets $ 77,062 Liabilities Operating lease liabilities, current $ 4,320 Operating lease liabilities, non-current 86,187 Total operating lease liabilities $ 90,507 During the three and nine months ended December 31, 2019 , operating lease expense was approximately $4.4 million and $10.7 million , respectively. Variable lease cost and short-term lease cost were immaterial during the three and nine months ended December 31, 2019 . The following table presents supplemental information for the nine months ended December 31, 2019 (in thousands, except for weighted average): Weighted average remaining lease term 9.2 years Weighted average discount rate 4.0 % Cash paid for amounts included in the measurement of lease liabilities $ 7,207 Operating cash flow from operating leases $ 7,207 The following table presents maturity of lease liabilities under the Company's non-cancellable operating leases as of December 31, 2019 (in thousands): Remaining 2020 $ 2,674 2021 8,609 2022 14,324 2023 11,724 2024 11,765 Thereafter 69,554 Total lease payments $ 118,650 Less: imputed interest (22,003 ) Less: lease incentives receivable (6,140 ) Present value of lease liabilities $ 90,507 The Company entered into an operating lease for an office space that has not yet commenced and as such, have not yet been recognized on the Company's condensed consolidated balance sheet as of December 31, 2019. The contractual obligation for this lease is $2.9 million . The Company's lease agreement (the "Agreement") with CAP Phase I, a Delaware limited liability company (the "Landlord") for the Coleman property is not included in the right-of-use assets and operating lease liabilities as of December 31, 2019 . On April 30, 2019, the Company entered into an assignment and assumption of the Company's previously executed lease agreement with the Landlord, and Roku Inc., a Delaware corporation ("Roku"), whereby the Company assigned to Roku this lease that had been executed between the Company and the Landlord on January 23, 2018. Pursuant to the Agreement, the Company expects to be released from all of its obligations under the lease and related standby letter of credit by the end of the Company’s fiscal year ending March 31, 2022, or shortly thereafter. On July 3, 2019, the Company entered into a lease for a new company headquarters to rent 177,815 square feet of office space as the sole tenant in a new five -story office building located in Campbell, California. The lease is for a 132 -month term that started on January 1, 2020. The Company has the option to extend the lease for two additional five-year terms, on substantially the same terms and conditions as the prior term, with the base rent rate adjusted to fair market value at that time. Base rent is approximately $0.7 million per month for the first 12 months of the lease, with the rate increasing by approximately 3% on each anniversary of the lease. The Company is responsible for paying its share of building and common area expenses. The Company is entitled to full rent abatement during the first 12 months of the lease term. The Company is also entitled to a tenant improvement allowance of approximately $15.4 million . The Company paid to the landlord a security deposit in the amount of $2.0 million , which may be drawn down in the event the Company defaults under the lease. The Company recognized an operating lease right-of-use asset and operating lease liability during second quarter of fiscal 2020, when the Company was given full access to the leased property. This new lease increased our operating lease right-of-use assets by $56.8 million and our operating lease liabilities by $56.1 million . |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Other Commitments, Indemnifications and Contingencies From time to time the Company receives inquiries from various state and municipal taxing agencies with respect to the remittance of sales, use, telecommunications, excise, and income taxes. Several jurisdictions currently are conducting tax audits of the Company's records. The Company collects from its customers or has accrued for taxes that it believes are required to be remitted. The amounts that have been remitted have historically been within the accruals established by the Company. The Company adjusts its accrued taxes when facts relating to specific exposures warrant such adjustment. Legal Proceedings The Company from time to time may be involved in a variety of claims, lawsuits, investigations and other proceedings, including patent infringement claims, employment litigation, regulatory compliance matters and contractual disputes, that can arise in the normal course of the Company's operations. The Company accrues a liability when management believes information available prior to the issuance of the financial statements indicates it is probable a loss has been incurred as of the date of the financial statements and the amount of loss can be reasonably estimated. The Company adjusts its accruals to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular case. Legal costs are expensed as incurred. As of December 31, 2019 , the Company does not have any material provisions for any such lawsuits, claims and proceedings and believes it is not probable that a loss had been incurred. Litigation is inherently unpredictable and subject to significant uncertainties. While there can be no assurances that favorable final outcomes will be obtained, the Company believes it has valid defenses with respect to legal matters pending against it. Future litigation could be costly to defend, could impose significant burdens on employees and cause the diversion of management's attention, and could upon resolution have a material adverse effect on the Company's business, results of operations, financial condition and cash flows. |
CONVERTIBLE SENIOR NOTES AND CA
CONVERTIBLE SENIOR NOTES AND CAPPED CALL | 9 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE SENIOR NOTES AND CAPPED CALL | CONVERTIBLE SENIOR NOTES AND CAPPED CALL Convertible Senior Notes In February 2019, the Company issued $287.5 million aggregate principal amount of 0.50% convertible senior notes (the "Initial Notes") due 2024 in a private placement, including the exercise in full of the initial purchasers' option to purchase additional notes. The Initial Notes are senior unsecured obligations of the Company and interest is payable semiannually in arrears on February 1 and August 1 of each year, beginning on August 1, 2019. The Initial Notes will mature on February 1, 2024, unless earlier repurchased, redeemed, or converted. The total net proceeds from the debt offering, after deducting initial purchase discounts, debt issuance costs, and costs of the capped call transactions described below, were approximately $245.8 million . In November 2019, the Company issued an additional $75 million aggregate principal amount of 0.50% convertible senior notes (the "Additional Notes" and together with the Initial Notes, the "Notes") due 2024 in a registered offering under the same indenture as the Initial Notes. The total net proceeds from the Additional Notes, after deducting underwriting discounts, debt issuance costs, and costs of the capped call transactions described below, were approximately $64.6 million . The Additional Notes constitute a further issuance of, and form a single series with, the Company’s outstanding 0.50% convertible senior notes due 2024 issued in February 2019 in the aggregate principal amount of $287.5 million . Immediately after giving effect to the issuance of the Additional Notes, the Company has $362.5 million aggregate principal amount of convertible senior notes. The Notes are senior unsecured obligations of the Company and interest is payable semiannually in arrears on February 1 and August 1 of each year, beginning on February 1, 2020. The Notes will mature on February 1, 2024, unless earlier repurchased, redeemed, or converted. Each $1,000 principal amount of the Notes are initially convertible into 38.9484 shares of the Company’s common stock, par value $0.001 , which is equivalent to an initial conversion price of approximately $25.68 per share. The conversion rate is subject to adjustment upon the occurrence of certain specified events but will not be adjusted for any accrued and unpaid interest. In addition, upon the occurrence of certain corporate events that occur prior to the maturity date or following the Company's issuance of a notice of redemption, in each case as described in the Indenture, the Company will, in certain circumstances, increase the conversion rate for a holder that elects to convert its Notes in connection with such a corporate event or during the relevant redemption period. The Notes will be convertible at certain times and upon the occurrence of certain events in the future. Further, on or after October 1, 2023, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their Notes, regardless of the foregoing circumstances. Upon conversion, the Company will satisfy its conversion obligation by paying or delivering, as the case may be, cash, shares of common stock, or a combination of cash and shares of common stock, at the Company's election. The Company’s current intent is to settle the principal amount of the Notes in cash upon conversion. During the three and nine months ended December 31, 2019 , the conditions allowing holders of the Notes to convert were not met. The Company may not redeem the Notes prior to February 4, 2022. On or after February 4, 2022, the Company may redeem for cash all or part of the Notes, at the redemption price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if the last reported sale price of the common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides a redemption notice. If a fundamental change (as defined in the indenture governing the notes) occurs at any time, holders of Notes may require the Company to repurchase for cash all or any portion of their Notes at a repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The Notes are senior unsecured obligations and will rank senior in right of payment to any of the Company’s indebtedness that is expressly subordinated in right of payment to the Notes, equal in right of payment with the Company’s existing and future liabilities that are not so subordinated, effectively junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness, and structurally junior to all indebtedness and other liabilities (including trade payables) of current or future subsidiaries of the Company. The net carrying amount of the liability component of the Notes was as follows (in thousands): December 31, 2019 March 31, 2019 Principal $ 362,500 $ 287,500 Unamortized premium 1,323 — Unamortized debt discount (75,315 ) (70,876 ) Unamortized issuance costs (1,043 ) (589 ) Net carrying amount $ 287,465 $ 216,035 Interest expense related to the Notes was as follows (in thousands): Three Months Ended Nine Months Ended December 31, 2019 December 31, 2019 Contractual interest expense $ 400 $ 1,119 Amortization of debt premium (31 ) — Amortization of debt discount 3,582 9,926 Amortization of issuance costs 40 92 Total interest expense $ 3,991 $ 11,137 Capped Call In connection with the pricing of the Initial Notes and Additional Notes, the Company entered into privately negotiated capped call transactions ("Capped Calls") with certain counterparties. The Capped Calls each have an initial strike price of approximately $25.68 per share, subject to certain adjustments, which corresponds to the initial conversion price of the Notes. The Capped Calls have initial cap prices of $39.50 per share, subject to certain adjustments. The Capped Calls are expected to partially offset the potential dilution to the Company’s Common Stock upon any conversion of the Notes, with such offset subject to a cap based on the cap price. The Capped Calls cover, subject to anti-dilution adjustments, approximately 14.1 million shares of the Company’s Common Stock. The Capped Calls are subject to adjustment upon the occurrence of specified extraordinary events affecting the Company, including merger events, tender offers and announcement events. In addition, the Capped Calls are subject to certain specified additional disruption events that may give rise to a termination of the Capped Calls, including nationalization, insolvency or delisting, changes in law, failures to deliver, insolvency filings and hedging disruptions. For accounting purposes, the Capped Calls are separate transactions, and not part of the terms of the Notes. As these transactions meet certain accounting criteria, the Capped Calls are recorded in stockholders' equity and are not accounted for as derivatives. The cost of $33.7 million incurred to purchase the Capped Calls in connection with the Initial Notes and $9.3 million in connection with the Additional Notes were recorded as a reduction to additional paid-in capital and will not be remeasured. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION The following tables summarize information pertaining to the stock-based compensation expense from stock options and stock awards (in thousands, except weighted-average grant-date fair value and recognition period): Three Months Ended December 31, Nine Months Ended December 31, 2019 2018 2019 2018 Cost of service revenue $ 2,226 $ 1,562 $ 5,896 $ 3,967 Research and development 5,535 3,570 13,616 8,587 Sales and marketing 5,197 3,798 14,458 8,402 General and administrative 6,359 3,605 16,335 10,619 Total $ 19,317 $ 12,535 $ 50,305 $ 31,575 Nine Months Ended December 31, 2019 2018 Stock options outstanding at the beginning of the period: 3,114 3,998 Options granted — 222 Options exercised (391 ) (641 ) Options canceled and forfeited (55 ) (192 ) Options outstanding at the end of the period: 2,668 3,387 Weighted-average fair value of grants during the period $ — $ 8.27 Total intrinsic value of options exercised during the period $ 4,844 $ 9,148 Weighted-average remaining recognition period at period-end (in years) 2.16 2.53 Stock awards outstanding at the beginning of the period: 7,820 5,939 Stock awards granted 5,886 4,993 Stock awards vested (2,860 ) (2,123 ) Stock awards canceled and forfeited (1,056 ) (700 ) Stock awards outstanding at the end of the period: 9,790 8,109 Weighted-average fair value of grants during the period $ 22.35 $ 20.05 Weighted-average remaining recognition period at period-end (in years) 2.13 2.40 Total unrecognized compensation expense at period-end $ 143,593 $ 112,970 Stock Repurchases In May 2017, the Company's board of directors authorized the Company to purchase up to $25.0 million of its common stock from time to time (the "2017 Repurchase Plan"). The 2017 Repurchase Plan expires when the maximum purchase amount is reached, or upon the earlier revocation or termination by the board of directors. The remaining amount available under the 2017 Repurchase Plan at December 31, 2019 was approximately $7.1 million. There were no stock repurchases under the 2017 Repurchase Plan during the three and nine months ended December 31, 2019 . |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company's effective tax rate was (0.6)% and (0.5)% for the three months ended December 31, 2019 and 2018 , and (0.6)% and for each of the nine months ended December 31, 2019 and 2018 |
NET LOSS PER SHARE
NET LOSS PER SHARE | 9 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
NET LOSS PER SHARE | NET LOSS PER SHARE The following table summarizes the computation of basic and diluted net loss per share (in thousands, except share and per share data): Three Months Ended December 31, Nine Months Ended December 31, 2019 2018 2019 2018 Numerator: Net loss available to common stockholders $ (47,071 ) $ (23,771 ) $ (122,268 ) $ (60,608 ) Denominator: Common shares - basic and diluted 99,922 95,370 99,082 94,093 Net loss per share Basic and diluted $ (0.47 ) $ (0.25 ) $ (1.23 ) $ (0.64 ) The following shares attributable to outstanding stock options and stock awards were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive (in thousands): Three Months Ended December 31, Nine Months Ended December 31, 2019 2018 2019 2018 Stock options 2,668 3,387 2,668 3,387 Stock awards 9,790 8,109 9,790 8,109 Contingently issuable shares (hold-back shares) 350 — 350 — Potential shares to be issued from ESPP 387 — 387 — Total anti-dilutive shares 13,195 11,496 13,195 11,496 |
GEOGRAPHICAL INFORMATION
GEOGRAPHICAL INFORMATION | 9 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
GEOGRAPHICAL INFORMATION | GEOGRAPHICAL INFORMATION The following tables set forth the geographic information for each period (in thousands): Three Months Ended December 31, Nine Months Ended December 31, 2019 2018 2019 2018 Revenue by geographic area: United States $ 90,171 $ 77,606 $ 258,847 $ 223,690 International 28,396 12,306 65,912 35,129 $ 118,567 $ 89,912 $ 324,759 $ 258,819 December 31, 2019 March 31, 2019 Property and equipment by geographic area: United States $ 82,790 $ 45,639 International 6,986 7,196 $ 89,776 $ 52,835 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Fiscal Period | The Company's fiscal year ends on March 31 of each calendar year. Each reference to a fiscal year in these notes to the condensed consolidated financial statements refers to the fiscal year ended March 31 of the calendar year indicated (for example, fiscal 2020 refers to the fiscal year ending March 31, 2020 ). |
Basis of Presentation | The accompanying interim condensed consolidated financial statements are unaudited and have been prepared on substantially the same basis as our annual consolidated financial statements for the fiscal year ended March 31, 2019 with the exception of new lease accounting guidance discussed in the recently adopted accounting principles section below. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") have been condensed or omitted pursuant to the rules and regulations of the SEC, regarding interim financial reporting. In the opinion of the Company's management, these interim condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of our financial position, results of operations, and cash flows for the periods presented. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. The March 31, 2019 year-end condensed consolidated balance sheet data in this document were derived from audited consolidated financial statements and does not include all of the disclosures required by GAAP. These condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements as of and for the fiscal year ended March 31, 2019 and notes thereto included in the Company's fiscal 2019 Annual Report on Form 10-K. The results of operations and cash flows for the interim periods included in these condensed consolidated financial statements are not necessarily indicative of the results to be expected for any future period or the entire fiscal year. |
Use of Estimates | The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and equity and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including, but not limited to, those related to bad debts, returns reserve for expected cancellations, fair value of and/or potential impairment of goodwill and intangible assets, capitalization of internally developed software, benefit period for deferred commissions, stock-based compensation, discount rate used to calculate operating lease liabilities, income and sales tax liabilities, convertible senior notes fair value, litigation, and other contingencies. The Company bases its estimates on known facts and circumstances, historical experience, and various other assumptions. Actual results could differ from those estimates under different assumptions or conditions. |
Reclassifications and Other Changes | Certain prior year amounts in the statements of cash flows have been reclassified to conform with current year presentation. |
Recently Adopted Accounting Pronouncements, Recent Accounting Pronouncements | RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS Effective April 1, 2019, the Company adopted ASU No. 2016-02 (“ASU 2016-02”), Leases using the modified retrospective transition approach utilizing the effective date as the date of initial application. ASU 2016-02 establishes a new lease accounting model for leases, which requires lessees to recognize right-of-use assets and lease liabilities on the balance sheet, but lease expense will be recognized on the income statement in a manner similar to previous requirements. Prior years presented have not been adjusted for ASU 2016-02 and continue to be reported in accordance with our historical accounting policy. The new standard provides a number of optional practical expedients in transition. The Company has elected certain practical expedients permitted under the new lease standard, which among other things, allows the carryforward of the historical lease classification. As a result, there was no impact to opening retained earnings. The new standard also provides a practical expedient for an entity’s ongoing accounting. The Company has elected such practical expedient to not separate lease and non-lease components for all leases. It also made an accounting policy election to not recognize right-of-use assets and lease liabilities on the balance sheet for leases with a term of 12 months or less and will recognize lease payments as an expense on a straight-line basis over the lease term. The adoption of the new lease standard resulted in the recognition of right-of-use assets and lease liabilities of approximately $20.0 million and $21.4 million , respectively, for existing operating leases. The Company does not have significant finance lease right-of-use assets or liabilities. The adoption of the new lease standard did not have a material impact on the Company's accumulated deficit as of April 1, 2019. For additional information on leases and the impact of the new lease standard, refer to Note 7. RECENT ACCOUNTING PRONOUNCEMENTS In December 2019, the Financial Accounting Standards Board (the "FASB") issued ASU 2019-02, Income Taxes (Topic 740) , which enhances and simplifies various aspects of the income tax accounting guidance, including requirements such as tax basis step-up in goodwill obtained in a transaction that is not a business combination, ownership changes in investments, and interim-period accounting for enacted changes in tax law. The amendment will be effective for public companies with fiscal years beginning after December 15, 2020, which is fiscal 2022 for the Company; early adoption is permitted. The Company is currently assessing the impact of this pronouncement to its consolidated financial statements. In November 2019, the FASB issued ASU 2019-08, Compensation - Stock Compensation (Topic 718) . The amendment requires that an entity measure and classify share-based payment awards granted to a customer by applying the guidance in Topic 718. The amount recorded as a reduction of the transaction price is required to be measured on the basis of the grant-date fair value of the share-based payment award in accordance with Topic 718. The amendments in this update are effective for fiscal years beginning after December 15, 2019, which is fiscal 2021 for the Company; early adoption is permitted. The Company is currently assessing the impact of this pronouncement to its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) , which makes modifications to disclosure requirements on fair value measurements. The amendment is effective for public companies with fiscal years beginning after December 15, 2019, which is fiscal 2021 for the Company; early adoption is permitted. The Company is currently assessing the impact of this pronouncement to its consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal Use Software (Subtopic 350-40) , which reduces complexity for the accounting for costs of implementing a cloud computing service arrangement. The amendment is effective for public companies with fiscal years beginning after December 15, 2019, which is fiscal 2021 for the Company; early adoption is permitted. The Company is currently assessing the impact of this pronouncement to its consolidated financial statements. In June 2016, the FASB issued ASU 2016‑13, Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments , which changes the impairment model for most financial assets. The new model uses a forward‑looking expected loss method, which will generally result in earlier recognition of allowances for losses. In November 2018, the FASB issued ASU 2018‑19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses , which clarifies that receivables arising from operating leases are not within the scope of Topic 326, Financial Instruments—Credit Losses . Instead, impairment of receivables arising from operating leases should be accounted for in accordance with Topic 842, Leases . In April 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses , Topic 815, Derivatives and Hedging , and Topic 825, Financial Instruments , which clarifies treatment of certain credit losses. In May 2019, the FASB issued ASU 2019-05, Financial Instruments — Credit Losses (Topic 326): Targeted Transition Relief , which permits an entity, upon adoption of ASU 2016-13, to irrevocably elect the fair value option (on an instrument-by-instrument basis) for eligible financial assets measured at amortized cost basis. In November 2019, the FASB issued ASU 2019-11, Codification Improvements to Topic 326, Financial Instruments — Credit Losses , which included various narrow-scope improvements and clarifications. In November 2019, FASB issued ASU No. 2019-10, Financial Instruments — Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) . These ASUs are effective for annual and interim periods beginning after December 15, 2019, which is fiscal 2021 for the Company; early adoption is permitted. The Company is currently assessing the impact of this pronouncement to its consolidated financial statements. |
Revenue Recognition | The Company recognizes service revenue, mainly from subscription services to its cloud-based voice, contact center, video, collaboration and communication APIs solutions using the five-step model as prescribed by ASC 606, Revenue from Contracts with Customers : • Identification of the contract, or contracts, with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when or as the Company satisfies a performance obligation. The Company identifies performance obligations in contracts with customers, which may include subscription services and related usage, products, and professional services. The transaction price is determined based on the amount the Company expects to be entitled to receive in exchange for transferring the promised services or products to the customer. The transaction price in the contract is allocated to each distinct performance obligation in an amount that represents the relative amount of consideration expected to be received in exchange for satisfying each performance obligation. Revenue is recognized when performance obligations are satisfied. Revenues are recorded based on the transaction price, excluding amounts collected on behalf of third parties such as sales and telecommunication taxes, which are collected on behalf of and remitted to governmental authorities. The Company usually bills its customers on a monthly basis. Contracts typically range from annual to multi-year agreements with payment terms of net 30-days or less. The Company occasionally allows a 30-day period to cancel a subscription and return products shipped for a full refund. Judgments and Estimates The estimation of variable consideration for each performance obligation requires the Company to make subjective judgments. The Company has service-level agreements with customers warranting defined levels of uptime reliability and performance. Customers may get credits or refunds if the Company fails to meet such levels. If the services do not meet certain criteria, fees are subject to adjustment or refund representing a form of variable consideration. The Company may impose minimum revenue commitments ("MRC") on its customers at the inception of the contract. Thus, in estimating variable consideration for each of these performance obligations, the Company assesses both the probability of MRC occurring and the collectability of the MRC, of which both represent a form of variable consideration. The Company enters into contracts with customers that regularly include promises to transfer multiple services and products, such as subscriptions, products, and professional services. For arrangements with multiple services, the Company evaluates whether the individual services qualify as distinct performance obligations. In its assessment of whether a service is a distinct performance obligation, the Company determines whether the customer can benefit from the service on its own or with other readily available resources, and whether the service is separately identifiable from other services in the contract. This evaluation requires the Company to assess the nature of each individual service offering and how the services are provided in the context of the contract, including whether the services are significantly integrated, highly interrelated, or significantly modify each other, which may require judgment based on the facts and circumstances of the contract. When agreements involve multiple distinct performance obligations, the Company allocates arrangement consideration to all performance obligations at the inception of an arrangement based on the relative standalone selling prices ("SSP") of each performance obligation. Usage fees deemed to be variable consideration meet the allocation exception for variable consideration. Where the Company has standalone sales data for its performance obligations which are indicative of the price at which the Company sells a promised good or service separately to a customer, such data is used to establish SSP. In instances where standalone sales data is not available for a particular performance obligation, the Company estimates SSP by the use of observable market and cost-based inputs. The Company continues to review the factors used to establish list price and will adjust standalone selling price methodologies as necessary on a prospective basis. Service Revenue Service revenue from subscriptions to the Company's cloud-based technology platform is recognized over time on a ratable basis over the contractual subscription term beginning on the date that the platform is made available to the customer. Payments received in advance of subscription services being rendered are recorded as a deferred revenue. Usage fees from our unified communications as a service ("UCaaS") and contact center as a service ("CCaaS") offerings, either bundled or not bundled, are recognized as revenue when earned. Usage fees for our communication platform as a service ("CPaaS") offerings are typically invoiced monthly in arrears and recognized as revenues when earned. Professional services for configuration, system integration, optimization, customer training or education are primarily billed on a fixed-fee basis and are performed by the Company directly or, alternatively, customers may also choose to perform these services themselves or engage their own third-party service providers. Professional services revenue is recognized over time as the services are rendered. When a contract with a customer is signed, the Company assesses whether collection of the fees under the arrangement is probable. The Company estimates the amount to reserve for uncollectible amounts based on the aging of the contract balance, current and historical customer trends, and communications with its customers. These reserves are recorded as operating expenses against the contract asset (Accounts Receivable). In the normal course of business, the Company records revenue reductions for customer credits. Product Revenue The Company recognizes product revenue for telephony equipment at a point in time, when transfer of control has occurred, which is generally upon shipment. Sales returns are recorded as a reduction to revenue estimated based on historical experience. Contract Assets Contract assets are recorded for those parts of the contract consideration not yet invoiced but for which the performance obligations are completed. The revenue is recognized when the customer receives services or equipment for a reduced consideration at the onset of an arrangement, for example, when the initial month's services or equipment are discounted. Contract assets are included in other current or non-current assets in the condensed consolidated balance sheets, depending on if their reduction will be recognized during the succeeding twelve-month period or beyond. Deferred Revenue Deferred revenues represent billings or payments received in advance of revenue recognition and is recognized upon transfer of control. Balances consist primarily of annual plan subscription services and professional and training services not yet provided as of the balance sheet date. Deferred revenues that will be recognized during the succeeding twelve-month period are recorded as current deferred revenues in the condensed consolidated balance sheets, with the remainder recorded as other non-current liabilities in the condensed consolidated balance sheets. Costs to Obtain a Customer Contract Sales commissions and related expenses are considered incremental and recoverable costs of acquiring customer contracts. These costs are capitalized as current or non-current assets and amortized on a straight-line basis over the anticipated benefit period, which is five years . The benefit period was estimated by taking into consideration the length of customer contracts, technology lifecycle, and other factors. This amortization expense is recorded in sales and marketing expense within the Company's condensed consolidated statement of operations. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Contract Balances | The following table provides information about receivables, contract assets and deferred revenues from contracts with customers (in thousands): December 31, 2019 Accounts receivable, net $ 37,384 Contract assets - current $ 10,507 Contract assets - non-current $ 8,413 Deferred revenue - current $ 7,216 Deferred revenue - non-current $ 1,411 Changes in the contract assets and the deferred revenue balances during the nine months ended December 31, 2019 are as follows (in thousands): December 31, 2019 March 31, 2019 $ Change Contract assets $ 18,920 $ 5,717 $ 13,203 Deferred revenue $ 8,627 $ 3,342 $ 5,285 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Cash, cash equivalents, and available-for-sale investments (in thousands): Amortized Gross Unrealized Gross Unrealized Estimated Cash and Cash Short-Term Long-Term As of December 31, 2019 Costs Gain Loss Fair Value Equivalents Investments Investments Cash $ 22,722 $ — $ — $ 22,722 $ 22,722 $ — $ — Level 1: Money market funds 157,401 — — 157,401 157,401 — — Treasury securities 6,498 13 — 6,511 — — 6,511 Subtotal 186,621 13 — 186,634 180,123 — 6,511 Level 2: Corporate bonds 36,181 93 — 36,274 — 22,659 13,615 Commercial paper 8,835 1 — 8,836 4,671 4,165 — Municipal securities 1,345 — — 1,345 — 1,345 — Agency bonds 2,099 15 — 2,114 — 2,114 — Subtotal 48,460 109 — 48,569 4,671 30,283 13,615 Total assets $ 235,081 $ 122 $ — $ 235,203 $ 184,794 $ 30,283 $ 20,126 Amortized Gross Unrealized Gross Unrealized Estimated Cash and Cash Short-Term As of March 31, 2019 Costs Gain Loss Fair Value Equivalents Investments Cash $ 25,364 $ — $ — $ 25,364 $ 25,364 $ — Level 1: Money market funds 251,219 — — 251,219 251,219 — Subtotal 276,583 — — 276,583 276,583 — Level 2: Corporate debt 46,516 51 (29 ) 46,538 — 46,538 Municipal securities 5,511 17 — 5,528 — 5,528 Asset backed securities 13,596 9 (17 ) 13,588 — 13,588 Agency bonds 4,260 — (15 ) 4,245 — 4,245 Subtotal 69,883 77 (61 ) 69,899 — 69,899 Total assets $ 346,466 $ 77 $ (61 ) $ 346,482 $ 276,583 $ 69,899 |
BUSINESS COMBINATIONS (Tables)
BUSINESS COMBINATIONS (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The major classes of assets and liabilities to which the Company has preliminarily allocated the fair value of purchase consideration were as follows (in thousands): July 17, 2019 Cash $ 4,473 Accounts receivable 9,438 Intangible assets 21,010 Other assets 787 Goodwill 91,060 Accounts payable (9,548 ) Deferred revenue (90 ) Total consideration $ 117,130 |
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination | The preliminary value of the acquired intangible assets acquired are as follows (in thousands): Fair Value Useful life (in Years) Trade and domain names $ 990 3 Developed technology 13,830 7 Customer relationships 6,190 7 Total intangible assets $ 21,010 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
Intangible Assets, Net (Including Goodwill) [Abstract] | |
Carrying Value of Intangible Assets | The carrying value of intangible assets consisted of the following (in thousands): December 31, 2019 March 31, 2019 Gross Accumulated Net Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology $ 33,685 $ (14,497 ) $ 19,188 $ 25,702 $ (15,409 ) $ 10,293 Customer relationships 11,601 (5,297 ) 6,304 9,467 (8,080 ) 1,387 Trade and domain names 1,128 (165 ) 963 2,108 (2,108 ) — Total acquired identifiable intangible assets $ 46,414 $ (19,959 ) $ 26,455 $ 37,277 $ (25,597 ) $ 11,680 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | At December 31, 2019 , annual amortization of intangible assets, based upon our existing intangible assets and current useful lives, is estimated to be the following (in thousands): Amount Remaining 2020 $ 2,326 2021 6,755 2022 4,946 2023 3,162 2024 2,851 Thereafter 6,415 Total $ 26,455 |
Schedule of Goodwill | The following table provides a summary of the changes in the carrying amounts of goodwill (in thousands): Total Balance at March 31, 2019 $ 39,694 Additions due to acquisitions 91,060 Foreign currency translation 246 Balance at December 31, 2019 $ 131,000 |
RIGHT-OF-USE ASSETS AND LEASES
RIGHT-OF-USE ASSETS AND LEASES (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Assets and Liabilities, Leases | The following table provides balance sheet information related to leases as of December 31, 2019 (in thousands): December 31, 2019 Assets Operating lease, right-of-use assets $ 77,062 Liabilities Operating lease liabilities, current $ 4,320 Operating lease liabilities, non-current 86,187 Total operating lease liabilities $ 90,507 |
Lease, Cost | The following table presents supplemental information for the nine months ended December 31, 2019 (in thousands, except for weighted average): Weighted average remaining lease term 9.2 years Weighted average discount rate 4.0 % Cash paid for amounts included in the measurement of lease liabilities $ 7,207 Operating cash flow from operating leases $ 7,207 |
Lessee, Operating Leases, Liability, Maturity | The following table presents maturity of lease liabilities under the Company's non-cancellable operating leases as of December 31, 2019 (in thousands): Remaining 2020 $ 2,674 2021 8,609 2022 14,324 2023 11,724 2024 11,765 Thereafter 69,554 Total lease payments $ 118,650 Less: imputed interest (22,003 ) Less: lease incentives receivable (6,140 ) Present value of lease liabilities $ 90,507 |
CONVERTIBLE SENIOR NOTES AND _2
CONVERTIBLE SENIOR NOTES AND CAPPED CALL (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Convertible Debt | The net carrying amount of the liability component of the Notes was as follows (in thousands): December 31, 2019 March 31, 2019 Principal $ 362,500 $ 287,500 Unamortized premium 1,323 — Unamortized debt discount (75,315 ) (70,876 ) Unamortized issuance costs (1,043 ) (589 ) Net carrying amount $ 287,465 $ 216,035 |
Interest Income and Interest Expense Disclosure | Interest expense related to the Notes was as follows (in thousands): Three Months Ended Nine Months Ended December 31, 2019 December 31, 2019 Contractual interest expense $ 400 $ 1,119 Amortization of debt premium (31 ) — Amortization of debt discount 3,582 9,926 Amortization of issuance costs 40 92 Total interest expense $ 3,991 $ 11,137 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Option Expense and Activity | The following tables summarize information pertaining to the stock-based compensation expense from stock options and stock awards (in thousands, except weighted-average grant-date fair value and recognition period): Three Months Ended December 31, Nine Months Ended December 31, 2019 2018 2019 2018 Cost of service revenue $ 2,226 $ 1,562 $ 5,896 $ 3,967 Research and development 5,535 3,570 13,616 8,587 Sales and marketing 5,197 3,798 14,458 8,402 General and administrative 6,359 3,605 16,335 10,619 Total $ 19,317 $ 12,535 $ 50,305 $ 31,575 Nine Months Ended December 31, 2019 2018 Stock options outstanding at the beginning of the period: 3,114 3,998 Options granted — 222 Options exercised (391 ) (641 ) Options canceled and forfeited (55 ) (192 ) Options outstanding at the end of the period: 2,668 3,387 Weighted-average fair value of grants during the period $ — $ 8.27 Total intrinsic value of options exercised during the period $ 4,844 $ 9,148 Weighted-average remaining recognition period at period-end (in years) 2.16 2.53 Stock awards outstanding at the beginning of the period: 7,820 5,939 Stock awards granted 5,886 4,993 Stock awards vested (2,860 ) (2,123 ) Stock awards canceled and forfeited (1,056 ) (700 ) Stock awards outstanding at the end of the period: 9,790 8,109 Weighted-average fair value of grants during the period $ 22.35 $ 20.05 Weighted-average remaining recognition period at period-end (in years) 2.13 2.40 Total unrecognized compensation expense at period-end $ 143,593 $ 112,970 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table summarizes the computation of basic and diluted net loss per share (in thousands, except share and per share data): Three Months Ended December 31, Nine Months Ended December 31, 2019 2018 2019 2018 Numerator: Net loss available to common stockholders $ (47,071 ) $ (23,771 ) $ (122,268 ) $ (60,608 ) Denominator: Common shares - basic and diluted 99,922 95,370 99,082 94,093 Net loss per share Basic and diluted $ (0.47 ) $ (0.25 ) $ (1.23 ) $ (0.64 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following shares attributable to outstanding stock options and stock awards were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive (in thousands): Three Months Ended December 31, Nine Months Ended December 31, 2019 2018 2019 2018 Stock options 2,668 3,387 2,668 3,387 Stock awards 9,790 8,109 9,790 8,109 Contingently issuable shares (hold-back shares) 350 — 350 — Potential shares to be issued from ESPP 387 — 387 — Total anti-dilutive shares 13,195 11,496 13,195 11,496 |
GEOGRAPHICAL INFORMATION (Table
GEOGRAPHICAL INFORMATION (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following tables set forth the geographic information for each period (in thousands): Three Months Ended December 31, Nine Months Ended December 31, 2019 2018 2019 2018 Revenue by geographic area: United States $ 90,171 $ 77,606 $ 258,847 $ 223,690 International 28,396 12,306 65,912 35,129 $ 118,567 $ 89,912 $ 324,759 $ 258,819 December 31, 2019 March 31, 2019 Property and equipment by geographic area: United States $ 82,790 $ 45,639 International 6,986 7,196 $ 89,776 $ 52,835 |
DESCRIPTION OF BUSINESS (Detail
DESCRIPTION OF BUSINESS (Details) | 9 Months Ended |
Dec. 31, 2019segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 1 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Apr. 01, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease, right-of-use assets | $ 77,062 | |
Present value of lease liabilities | $ 90,507 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease, right-of-use assets | $ 20,000 | |
Present value of lease liabilities | $ 21,400 |
REVENUE RECOGNITION - Narrative
REVENUE RECOGNITION - Narrative (Details) $ in Millions | 9 Months Ended |
Dec. 31, 2019USD ($) | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Deferred commission costs, amortization period | 5 years |
Contract with customer, revenue recognized | $ 2.9 |
Revenue, remaining performance obligation, amount | $ 245 |
Minimum | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
subscription term | 1 year |
Maximum | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
subscription term | 4 years |
REVENUE RECOGNITION - Contract
REVENUE RECOGNITION - Contract Balances (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Mar. 31, 2019 |
Revenue from Contract with Customer [Abstract] | ||
Accounts receivable, net | $ 37,384 | $ 20,181 |
Contract assets - current | 10,507 | |
Contract assets - non-current | 8,413 | |
Deferred revenue - current | 7,216 | $ 3,336 |
Deferred revenue - non-current | $ 1,411 |
REVENUE RECOGNITION - Changes i
REVENUE RECOGNITION - Changes in Contract Balances (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Dec. 31, 2019 | Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 18,920 | $ 5,717 |
Change in contract assets | 13,203 | |
Deferred revenue | 8,627 | $ 3,342 |
Change in deferred revenue | $ 5,285 |
REVENUE RECOGNITION - Remaining
REVENUE RECOGNITION - Remaining Performance Obligation (Details) | Dec. 31, 2019 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 36 months |
FAIR VALUE MEASUREMENTS - Fair
FAIR VALUE MEASUREMENTS - Fair Value Measurements (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Mar. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | $ 184,794 | $ 276,583 |
Accumulated gross unrealized gain, before tax | 122 | 77 |
Accumulated gross unrealized loss, before tax | 0 | (61) |
Cash, cash equivalents and debt securities available-for-sale, amortized cost | 235,081 | 346,466 |
Cash, cash equivalents and debt securities available-for-sale | 235,203 | 346,482 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 276,583 | |
Cash and cash equivalents, fair value | 276,583 | |
Accumulated gross unrealized gain, before tax | 13 | |
Accumulated gross unrealized loss, before tax | 0 | |
Cash, cash equivalents and debt securities available-for-sale, amortized cost | 186,621 | |
Cash, cash equivalents and debt securities available-for-sale | 186,634 | |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 48,460 | 69,883 |
Accumulated gross unrealized gain, before tax | 109 | 77 |
Accumulated gross unrealized loss, before tax | 0 | (61) |
Debt securities, available-for-sale | 48,569 | 69,899 |
Treasury securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 6,498 | |
Accumulated gross unrealized gain, before tax | 13 | |
Accumulated gross unrealized loss, before tax | 0 | |
Debt securities, available-for-sale | 6,511 | |
Corporate bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 36,181 | 46,516 |
Accumulated gross unrealized gain, before tax | 93 | 51 |
Accumulated gross unrealized loss, before tax | 0 | (29) |
Debt securities, available-for-sale | 36,274 | 46,538 |
Commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 8,835 | |
Accumulated gross unrealized gain, before tax | 1 | |
Accumulated gross unrealized loss, before tax | 0 | |
Debt securities, available-for-sale | 8,836 | |
Municipal securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 1,345 | 5,511 |
Accumulated gross unrealized gain, before tax | 0 | 17 |
Accumulated gross unrealized loss, before tax | 0 | 0 |
Debt securities, available-for-sale | 1,345 | 5,528 |
Asset backed securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 13,596 | |
Accumulated gross unrealized gain, before tax | 9 | |
Accumulated gross unrealized loss, before tax | (17) | |
Debt securities, available-for-sale | 13,588 | |
Agency bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 2,099 | 4,260 |
Accumulated gross unrealized gain, before tax | 15 | 0 |
Accumulated gross unrealized loss, before tax | 0 | (15) |
Debt securities, available-for-sale | 2,114 | 4,245 |
Cash | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 22,722 | 25,364 |
Cash and cash equivalents, fair value | 22,722 | 25,364 |
Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 157,401 | 251,219 |
Cash and cash equivalents, fair value | 157,401 | 251,219 |
Cash and Cash Equivalents | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 276,583 | |
Cash, cash equivalents and debt securities available-for-sale | 184,794 | |
Cash and Cash Equivalents | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 276,583 | |
Cash, cash equivalents and debt securities available-for-sale | 180,123 | |
Cash and Cash Equivalents | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 4,671 | |
Cash and Cash Equivalents | Commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 4,671 | |
Cash and Cash Equivalents | Cash | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 22,722 | 25,364 |
Cash and Cash Equivalents | Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 157,401 | 251,219 |
Short-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 69,899 | |
Cash, cash equivalents and debt securities available-for-sale | 30,283 | |
Short-term Investments | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 30,283 | 69,899 |
Short-term Investments | Corporate bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 22,659 | 46,538 |
Short-term Investments | Commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 4,165 | |
Short-term Investments | Municipal securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 1,345 | 5,528 |
Short-term Investments | Asset backed securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 13,588 | |
Short-term Investments | Agency bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 2,114 | $ 4,245 |
Long-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash, cash equivalents and debt securities available-for-sale | 20,126 | |
Long-term Investments | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 6,511 | |
Long-term Investments | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 13,615 | |
Long-term Investments | Treasury securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 6,511 | |
Long-term Investments | Corporate bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 13,615 | |
Long-term Investments | Commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 0 | |
Long-term Investments | Municipal securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | 0 | |
Long-term Investments | Agency bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities, available-for-sale | $ 0 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) $ in Millions | Dec. 31, 2019USD ($) |
Convertible Debt | Initial Notes | Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Debt instrument, fair value | $ 362.3 |
BUSINESS COMBINATIONS - Narrati
BUSINESS COMBINATIONS - Narrative (Details) - USD ($) shares in Thousands, $ in Millions | Jul. 17, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Business Acquisition [Line Items] | |||
Stock awards granted (in shares) | 5,886 | 4,993 | |
Wavecell Pte. Ltd. | |||
Business Acquisition [Line Items] | |||
Business combination, consideration transferred | $ 117.1 | ||
Payments to acquire business | 72.8 | ||
Business combination, value of stock issued | 44.3 | ||
Cash held back to cover indemnity claims | 10.4 | ||
Equity held back to cover indemnity claims | $ 8.5 | ||
Vesting period | 3 years | ||
Acquisition costs | $ 1.8 | ||
Wavecell Pte. Ltd. | Time-Based Restricted Stock Awards | |||
Business Acquisition [Line Items] | |||
Stock awards granted (in shares) | 13,200 | ||
Wavecell Pte. Ltd. | Performance-Based Restricted Stock Awards | |||
Business Acquisition [Line Items] | |||
Stock awards granted (in shares) | 6,600 | ||
Restricted Cash, Current And Other Accrued Liabilities | Wavecell Pte. Ltd. | |||
Business Acquisition [Line Items] | |||
Cash held back to cover indemnity claims | $ 3.5 | ||
Restricted Cash, Noncurrent And Other Liabilities, Noncurrent | Wavecell Pte. Ltd. | |||
Business Acquisition [Line Items] | |||
Cash held back to cover indemnity claims | 6.9 | ||
Other Accrued Liabilities, Current | Wavecell Pte. Ltd. | |||
Business Acquisition [Line Items] | |||
Equity held back to cover indemnity claims | 2.8 | ||
Other Noncurrent Liabilities | Wavecell Pte. Ltd. | |||
Business Acquisition [Line Items] | |||
Equity held back to cover indemnity claims | $ 5.7 |
BUSINESS COMBINATIONS - Allocat
BUSINESS COMBINATIONS - Allocation of the Fair Value of Purchase Consideration (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jul. 17, 2019 | Mar. 31, 2019 |
Business Acquisition [Line Items] | |||
Goodwill | $ 131,000 | $ 39,694 | |
Wavecell Pte. Ltd. | |||
Business Acquisition [Line Items] | |||
Cash | $ 4,473 | ||
Accounts receivable | 9,438 | ||
Intangible assets | 21,010 | ||
Other assets | 787 | ||
Goodwill | 91,060 | ||
Accounts payable | (9,548) | ||
Deferred revenue | (90) | ||
Total consideration | $ 117,130 |
BUSINESS COMBINATIONS - Fair Va
BUSINESS COMBINATIONS - Fair Value Intangible Assets Acquired (Details) - Wavecell Pte. Ltd. $ in Thousands | Jul. 17, 2019USD ($) |
Business Acquisition [Line Items] | |
Total intangible assets | $ 21,010 |
Trade and domain names | |
Business Acquisition [Line Items] | |
Total intangible assets | $ 990 |
Useful life (in Years) | 3 years |
Trade and domain names | |
Business Acquisition [Line Items] | |
Total intangible assets | $ 13,830 |
Useful life (in Years) | 7 years |
Customer relationships | |
Business Acquisition [Line Items] | |
Total intangible assets | $ 6,190 |
Useful life (in Years) | 7 years |
INTANGIBLE ASSETS AND GOODWIL_2
INTANGIBLE ASSETS AND GOODWILL - Carrying Value of Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Mar. 31, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 46,414 | $ 37,277 |
Accumulated Amortization | (19,959) | (25,597) |
Net Carrying Amount | 26,455 | 11,680 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 33,685 | 25,702 |
Accumulated Amortization | (14,497) | (15,409) |
Net Carrying Amount | 19,188 | 10,293 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 11,601 | 9,467 |
Accumulated Amortization | (5,297) | (8,080) |
Net Carrying Amount | 6,304 | 1,387 |
Trade and domain names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,128 | 2,108 |
Accumulated Amortization | (165) | (2,108) |
Net Carrying Amount | $ 963 | $ 0 |
INTANGIBLE ASSETS AND GOODWIL_3
INTANGIBLE ASSETS AND GOODWILL - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Mar. 31, 2019 |
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Remaining 2020 | $ 2,326 | |
2021 | 6,755 | |
2022 | 4,946 | |
2023 | 3,162 | |
2024 | 2,851 | |
Thereafter | 6,415 | |
Net Carrying Amount | $ 26,455 | $ 11,680 |
INTANGIBLE ASSETS AND GOODWIL_4
INTANGIBLE ASSETS AND GOODWILL - Summary of Changes in Goodwill (Details) $ in Thousands | 9 Months Ended |
Dec. 31, 2019USD ($) | |
Goodwill [Roll Forward] | |
Balance at March 31, 2019 | $ 39,694 |
Additions due to acquisitions | 91,060 |
Foreign currency translation | 246 |
Balance at December 31, 2019 | $ 131,000 |
RIGHT-OF-USE ASSETS AND LEASE_2
RIGHT-OF-USE ASSETS AND LEASES - Narrative (Details) $ in Millions | Jul. 03, 2019USD ($)ft²termstory | Dec. 31, 2019USD ($) | Dec. 31, 2019USD ($) |
Lessee, Lease, Description [Line Items] | |||
Term of contract | 132 months | ||
Renewal term | 12 months | ||
Operating lease expense | $ 4.4 | $ 10.7 | |
Amount of lease not yet commenced | $ 2.9 | $ 2.9 | |
Area of real estate property | ft² | 177,815 | ||
Number of building stories | story | 5 | ||
Number of renewal terms | term | 2 | ||
Base rent | $ 0.7 | ||
Annual percentage increase in base rent | 3.00% | ||
Tenant improvements | $ 15.4 | ||
Security deposit | 2 | ||
Increase in operating lease right-of-use asset | 56.8 | ||
Increase in operating lease liability | $ 56.1 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Term of contract | 1 year | 1 year | |
Renewal term | 1 year | 1 year | |
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Term of contract | 11 years | 11 years | |
Renewal term | 5 years | 5 years |
RIGHT-OF-USE ASSETS AND LEASE_3
RIGHT-OF-USE ASSETS AND LEASES - Components of Lease Right-of-Use Assets and Liabilities (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Assets | |
Operating lease, right-of-use assets | $ 77,062 |
Liabilities | |
Operating lease liabilities, current | 4,320 |
Operating lease liabilities, non-current | 86,187 |
Total operating lease liabilities | $ 90,507 |
RIGHT-OF-USE ASSETS AND LEASE_4
RIGHT-OF-USE ASSETS AND LEASES - Supplemental Information (Details) $ in Thousands | 9 Months Ended |
Dec. 31, 2019USD ($) | |
Leases [Abstract] | |
Weighted average remaining lease term | 9 years 2 months 12 days |
Weighted average discount rate | 4.00% |
Operating cash flow from operating leases | $ 7,207 |
RIGHT-OF-USE ASSETS AND LEASE_5
RIGHT-OF-USE ASSETS AND LEASES - Maturity of Lease Liabilities (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Leases [Abstract] | |
Remaining 2020 | $ 2,674 |
2021 | 8,609 |
2022 | 14,324 |
2023 | 11,724 |
2024 | 11,765 |
Thereafter | 69,554 |
Total lease payments | 118,650 |
Less: imputed interest | (22,003) |
Less: lease incentives receivable | (6,140) |
Present value of lease liabilities | $ 90,507 |
CONVERTIBLE SENIOR NOTES AND _3
CONVERTIBLE SENIOR NOTES AND CAPPED CALL - Narrative (Details) $ / shares in Units, shares in Millions | 1 Months Ended | 9 Months Ended | |||
Nov. 30, 2019USD ($) | Feb. 28, 2019USD ($)day$ / shares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 01, 2019USD ($) | Mar. 31, 2019USD ($) | |
Aggregate Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, strike price per share (in dollars per share) | $ / shares | $ 25.68 | ||||
Initial Notes | |||||
Debt Instrument [Line Items] | |||||
Payments for capped call transactions | $ 33,700,000 | ||||
Additional Notes | |||||
Debt Instrument [Line Items] | |||||
Payments for capped call transactions | $ 9,300,000 | ||||
Convertible Debt | Aggregate Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face value | $ 362,500,000 | $ 362,500,000 | $ 287,500,000 | ||
Debt instrument, convertible, conversion ratio | 0.0389484 | ||||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.001 | ||||
Debt instrument, convertible, conversion price (in dollars per share) | $ / shares | $ 25.68 | ||||
Debt instrument, redemption price, percentage | 100.00% | ||||
Debt instrument, convertible, threshold percentage of stock price trigger | 130.00% | ||||
Debt instrument, convertible, threshold trading days | day | 20 | ||||
Debt instrument, convertible, threshold consecutive trading days | day | 30 | ||||
Debt instrument, initial cap price per share (in dollars per share) | $ / shares | $ 39.50 | ||||
Convertible Debt | Aggregate Notes | Call Option | |||||
Debt Instrument [Line Items] | |||||
Option indexed to issuer's equity, indexed shares (in shares) | shares | 14.1 | ||||
Convertible Debt | Initial Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face value | $ 287,500,000 | ||||
Debt instrument, interest rate | 0.50% | ||||
Proceeds from issuance of debt | $ 245,800,000 | ||||
Convertible Debt | Additional Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face value | $ 75,000,000 | ||||
Debt instrument, interest rate | 0.50% | ||||
Proceeds from issuance of debt | $ 64,600,000 |
CONVERTIBLE SENIOR NOTES AND _4
CONVERTIBLE SENIOR NOTES AND CAPPED CALL - Carrying Amount of the Liability Component (Details) - Convertible Debt - Aggregate Notes - USD ($) | Dec. 31, 2019 | Dec. 01, 2019 | Mar. 31, 2019 |
Debt Instrument [Line Items] | |||
Principal | $ 362,500,000 | $ 362,500,000 | $ 287,500,000 |
Debt Instrument, Unamortized Premium | 1,323,000 | 0 | |
Unamortized debt discount | (75,315,000) | (70,876,000) | |
Unamortized issuance costs | (1,043,000) | (589,000) | |
Net carrying amount | $ 287,465,000 | $ 216,035,000 |
CONVERTIBLE SENIOR NOTES AND _5
CONVERTIBLE SENIOR NOTES AND CAPPED CALL - Interest Expense (Details) - Convertible Debt - Aggregate Notes - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Dec. 31, 2019 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||
Contractual interest expense | $ 400 | $ 1,119 |
Amortization of debt premium | (31) | 0 |
Amortization of debt discount | 3,582 | 9,926 |
Amortization of issuance costs | 40 | 92 |
Total interest expense | $ 3,991 | $ 11,137 |
STOCK-BASED COMPENSATION - Stoc
STOCK-BASED COMPENSATION - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 19,317 | $ 12,535 | $ 50,305 | $ 31,575 |
Cost of service revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | 2,226 | 1,562 | 5,896 | 3,967 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | 5,535 | 3,570 | 13,616 | 8,587 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | 5,197 | 3,798 | 14,458 | 8,402 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 6,359 | $ 3,605 | $ 16,335 | $ 10,619 |
STOCK-BASED COMPENSATION - St_2
STOCK-BASED COMPENSATION - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Stock Option Rollforward | ||
Stock options outstanding at the beginning of the period (in shares) | 3,114 | 3,998 |
Options granted (in shares) | 0 | 222 |
Options exercised (in shares) | (391) | (641) |
Options canceled and forfeited (in shares) | (55) | (192) |
Options outstanding at the end of the period (in shares) | 2,668 | 3,387 |
Weighted-average fair value of grants during the period (in dollars per share) | $ 0 | $ 8.27 |
Total intrinsic value of options exercised during the period | $ 4,844 | $ 9,148 |
Weighted-average remaining recognition period at period-end (in years) | 2 years 1 month 28 days | 2 years 6 months 10 days |
Stock Award Rollforward | ||
Stock awards outstanding at the beginning of the period (in shares) | 7,820 | 5,939 |
Stock awards granted (in shares) | 5,886 | 4,993 |
Stock awards vested (in shares) | (2,860) | (2,123) |
Stock awards canceled and forfeited (in shares) | (1,056) | (700) |
Stock awards outstanding at the end of the period (in shares) | 9,790 | 8,109 |
Weighted-average fair value of grants during the period (in dollars per share) | $ 22.35 | $ 20.05 |
Weighted-average remaining recognition period at period-end (in years) | 2 years 1 month 17 days | 2 years 4 months 24 days |
Total unrecognized compensation expense at period-end | $ 143,593 | $ 112,970 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) - 2017 Repurchase Plan - USD ($) | 3 Months Ended | 9 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2019 | May 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Authorized repurchase amount | $ 25,000,000 | ||
Remaining authorized repurchase amount | $ 7,100,000 | $ 7,100,000 | |
Stock repurchased during period (in shares) | 0 | 0 |
INCOME TAXES (Details)
INCOME TAXES (Details) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | (0.60%) | (0.50%) | (0.60%) | (0.60%) |
NET LOSS PER SHARE - Earnings P
NET LOSS PER SHARE - Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator: | ||||||||
Net loss available to common stockholders | $ (47,071) | $ (40,932) | $ (34,265) | $ (23,771) | $ (21,482) | $ (15,355) | $ (122,268) | $ (60,608) |
Denominator: | ||||||||
Common shares - basic and diluted (in shares) | 99,922 | 95,370 | 99,082 | 94,093 | ||||
Net loss per share | ||||||||
Basic and diluted (in dollars per share) | $ (0.47) | $ (0.25) | $ (1.23) | $ (0.64) |
NET LOSS PER SHARE - Antidiluti
NET LOSS PER SHARE - Antidilutive Securities (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of anti-dilutive shares (in shares) | 13,195 | 11,496 | 13,195 | 11,496 |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of anti-dilutive shares (in shares) | 2,668 | 3,387 | 2,668 | 3,387 |
Stock awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of anti-dilutive shares (in shares) | 9,790 | 8,109 | 9,790 | 8,109 |
Contingently issuable shares (hold-back shares) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of anti-dilutive shares (in shares) | 350 | 0 | 350 | 0 |
Potential shares to be issued from ESPP | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of anti-dilutive shares (in shares) | 387 | 0 | 387 | 0 |
GEOGRAPHICAL INFORMATION - Reve
GEOGRAPHICAL INFORMATION - Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | ||||
Total revenue | $ 118,567 | $ 89,912 | $ 324,759 | $ 258,819 |
United States | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 90,171 | 77,606 | 258,847 | 223,690 |
International | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | $ 28,396 | $ 12,306 | $ 65,912 | $ 35,129 |
GEOGRAPHICAL INFORMATION - PPE
GEOGRAPHICAL INFORMATION - PPE (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Mar. 31, 2019 |
Segment Reporting Information [Line Items] | ||
Property and equipment, net | $ 89,776 | $ 52,835 |
United States | ||
Segment Reporting Information [Line Items] | ||
Property and equipment, net | 82,790 | 45,639 |
International | ||
Segment Reporting Information [Line Items] | ||
Property and equipment, net | $ 6,986 | $ 7,196 |
Uncategorized Items - a8x812312
Label | Element | Value |
Accounting Standards Update 2016-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 39,901,000 |
Accounting Standards Update 2016-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 39,901,000 |