Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Nov. 07, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,017 | |
Entity Registrant Name | EVOLVING SYSTEMS INC | |
Trading Symbol | evol | |
Entity Central Index Key | 1,052,054 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 12,527,907 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 7,577 | $ 7,614 |
Contract receivables, net of allowance for doubtful accounts of $220 at September 30, 2017 and $221 at December 31, 2016 | 10,752 | 5,867 |
Unbilled work-in-progress | 6,333 | 3,376 |
Prepaid and other current assets | 3,016 | 1,553 |
Total current assets | 27,678 | 18,410 |
Property and equipment, net | 335 | 546 |
Amortizable intangible assets, net | 5,797 | 4,200 |
Goodwill | 24,956 | 20,599 |
Total assets | 58,766 | 43,755 |
Current liabilities: | ||
Term loans - current portion | 2,403 | 1,997 |
Accounts payable and accrued liabilities | 7,404 | 4,275 |
Income taxes payable | 1,016 | 617 |
Contingent earn-out obligation | 393 | |
Unearned revenue | 6,378 | 3,532 |
Total current liabilities | 17,594 | 10,421 |
Long-term liabilities: | ||
Term loans, net of current portion | 7,008 | 4,000 |
Total liabilities | 24,602 | 14,421 |
Commitments and contingencies: | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value; 2,000,000 shares authorized; no shares issued and outstanding as of September 30, 2017 and December 31, 2016 | ||
Common stock, $0.001 par value; 40,000,000 shares authorized; 12,119,213 shares issued and 11,940,324 outstanding as of September 30, 2017 and 12,086,280 shares issued and 11,907,391 outstanding as of December 31, 2016 | 12 | 12 |
Additional paid-in capital | 98,259 | 97,744 |
Treasury stock 178,889 shares at September 30, 2017 and December 31, 2016, at cost | (1,253) | (1,253) |
Accumulated other comprehensive loss | (8,511) | (9,992) |
Accumulated deficit | (54,343) | (57,177) |
Total stockholders' equity | 34,164 | 29,334 |
Total liabilities and stockholders' equity | $ 58,766 | $ 43,755 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Condensed Consolidated Balance Sheets [Abstract] | ||
Allowance for doubtful accounts receivable | $ 220 | $ 221 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, shares issued | 12,119,213 | 12,086,280 |
Common stock, shares outstanding | 11,940,324 | 11,907,391 |
Treasury stock, shares | 178,889 | 178,889 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
REVENUE | ||||
License fees | $ 1,068 | $ 850 | $ 2,131 | $ 2,292 |
Services | 6,479 | 5,253 | 17,513 | 16,369 |
Total revenue | 7,547 | 6,103 | 19,644 | 18,661 |
COSTS OF REVENUE AND OPERATING EXPENSES | ||||
Costs of revenue, excluding depreciation and amortization | 2,569 | 1,259 | 5,678 | 3,971 |
Sales and marketing | 1,439 | 1,236 | 3,485 | 3,807 |
General and administrative | 1,562 | 952 | 3,555 | 2,774 |
Product development | 356 | 697 | 1,499 | 2,485 |
Depreciation | 55 | 57 | 156 | 205 |
Amortization | 226 | 196 | 618 | 587 |
Restructuring | 131 | 3 | 131 | 1,007 |
Total costs of revenue and operating expenses | 6,338 | 4,400 | 15,122 | 14,836 |
Income from operations | 1,209 | 1,703 | 4,522 | 3,825 |
Other income (expense) | ||||
Interest income | 1 | 1 | 2 | 4 |
Interest expense | (91) | (74) | (234) | (265) |
Foreign currency exchange loss | (176) | (261) | (568) | (508) |
Other income (expense), net | (266) | (334) | (800) | (769) |
Income from operations before income taxes | 943 | 1,369 | 3,722 | 3,056 |
Income tax expense | 184 | 428 | 888 | 908 |
Net income | $ 759 | $ 941 | $ 2,834 | $ 2,148 |
Basic income per common share | $ 0.06 | $ 0.08 | $ 0.24 | $ 0.18 |
Diluted income per common share | $ 0.06 | $ 0.08 | $ 0.24 | 0.18 |
Cash dividend declared per common share | $ 0.22 | |||
Weighted average basic shares outstanding | 11,940 | 11,873 | 11,932 | 11,824 |
Weighted average diluted shares outstanding | 11,992 | 11,979 | 11,975 | 11,967 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements Of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Condensed Consolidated Statements Of Comprehensive Income (Loss) [Abstract] | ||||
Net income | $ 759 | $ 941 | $ 2,834 | $ 2,148 |
Other comprehensive gain (loss): | ||||
Foreign currency translation gain (loss) | 314 | (753) | 1,481 | (2,781) |
Comprehensive income (loss) | $ 1,073 | $ 188 | $ 4,315 | $ (633) |
Condensed Consolidated Stateme6
Condensed Consolidated Statement Of Changes In Stockholders' Equity - 9 months ended Sep. 30, 2017 - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-In Capital [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive Loss [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2016 | $ 12 | $ 97,744 | $ (1,253) | $ (9,992) | $ (57,177) | $ 29,334 |
Balance, shares at Dec. 31, 2016 | 11,907,391 | 11,907,391 | ||||
Stock option exercises | 27 | $ 27 | ||||
Stock option exercises, shares | 32,239 | |||||
Common stock issued pursuant to the Employee Stock Purchase Plan | 2 | 2 | ||||
Common stock issued pursuant to the Employee Stock Purchase Plan, shares | 694 | |||||
Stock-based compensation expense | 486 | 486 | ||||
Net income | 2,834 | 2,834 | ||||
Foreign currency translation adjustment | 1,481 | 1,481 | ||||
Balance at Sep. 30, 2017 | $ 12 | $ 98,259 | $ (1,253) | $ (8,511) | $ (54,343) | $ 34,164 |
Balance, shares at Sep. 30, 2017 | 11,940,324 | 11,940,324 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 2,834 | $ 2,148 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 156 | 205 |
Amortization of intangible assets | 618 | 587 |
Amortization of debt issuance costs | 10 | 27 |
Stock based compensation | 486 | 198 |
Unrealized foreign currency transaction loss, net | 568 | 508 |
Provision for deferred income taxes | (335) | (18) |
Change in operating assets and liabilities: | ||
Contract receivables | (2,474) | 735 |
Unbilled work-in-progress | (1,225) | 9 |
Prepaid and other assets | 562 | (389) |
Accounts payable and accrued liabilities | (759) | 202 |
Unearned revenue | 1,831 | 1,326 |
Other long-term obligations | 376 | |
Net cash provided by operating activities | 2,648 | 5,538 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of property and equipment | (71) | (24) |
Business combinations, net of cash received | (5,938) | |
Net cash used in investing activities | (6,009) | (24) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Capital lease payments | (1) | (4) |
Payments of the revolving line of credit | (10,000) | |
Proceeds from term loans | 4,730 | 6,000 |
Principal payments on term loans | (1,500) | |
Payments for debt issuance costs | (20) | (20) |
Common stock cash dividends | (2,596) | |
Proceeds from the issuance of stock | 29 | 65 |
Net cash provided by (used in) financing activities | 3,238 | (6,555) |
Effect of exchange rate changes on cash | 86 | (418) |
Net decrease in cash and cash equivalents | (37) | (1,459) |
Cash and cash equivalents at beginning of period | 7,614 | 8,400 |
Cash and cash equivalents at end of period | 7,577 | 6,941 |
Supplemental disclosure of cash and non-cash transactions: | ||
Income taxes paid | 1,320 | 791 |
Property and equipment purchased and included in accounts payable | $ 35 | $ 1 |
Basis Of Presentation
Basis Of Presentation | 9 Months Ended |
Sep. 30, 2017 | |
Basis Of Presentation [Abstract] | |
Basis Of Presentation | NOTE 1 — BASIS OF PRESENTATION Organization — We are a provider of software solutions and services to the wireless, wireline and cable markets. We maintain long-standing relationships with many of the largest wireless, wireline and cable companies worldwide. Our customers rely on us to develop, deploy, enhance and maintain software solutions that provide a variety of service activation and provisioning functions. In 2016, we began a shift from selling technology to offering business solutions. The value proposition has moved from cost savings to revenue increases for the carrier and our business model has moved from classic capex license and services to opex models based on recurring managed services with performance fees. Our software solution platform, Real-time Lifecycle Marketing ™ (“RLM”), enables carriers’ marketing departments to innovate, execute and manage highly-personalized and contextually-relevant, interactive campaigns that engage consumers in real time. Our service activation solution, Tertio ® (“TSA”) is used to activate bundles of voice, video and data services for wireless, wireline and cable network operators; our SIM card activation solution, Dynamic SIM Allocation TM (“DSA”) is used to dynamically allocate and assign resources to Mobile Network Operators (“MNOs”) devices that rely on SIM cards; our Mobile Data Enablement TM (“MDE”) solution provides a data consumption and policy management solution for wireless carriers and Mobile Virtual Network Operators (“MVNOs”) that monitor the usage and consumption of data services; our Total Number Management™ (“TNM”) product is a scalable and fully automated database solution that enables operators to reliably and efficiently manage their telephone numbers as well as other communication identifiers (i.e. SIMs, MSISDNs, IMSIs, ICCIDs, IPs). Our solutions can be deployed on premise or as a Software-as-a-Service (“SaaS”). On July 6, 2017 we announced the completion of the previously announced acquisition of Business Logic Systems (“BLS”). BLS, headquartered in Newbury, UK, specializes in data-driven customer value management and customer engagement solutions that have been implemented in over 20 mobile operators in Europe, Africa, Asia-Pacific and the Caribbean. BLS solutions turn customer data into actionable insights and personalized contextual offers. Customer engagement occurs through in-bound and out-bound offers and is further extended through a suite of loyalty and retention solutions. On September 7, 2017 we announced the completion of the acquisition of four business operating units of Lumata Holdings Ltd. (“the Lumata Entities”). The Lumata Entities are a leading global provider of real-time, next generation loyalty and customer lifecycle management software and services that helps businesses gain value from their customer data for relevant and contextual insights and actions of value to both customers and enterprises. Its customers include mobile operators including Orange, Telefonica and other Tier-1 and emerging operators in Europe and around the world. The acquisition is expected to be accretive to Evolving Systems' operations once the integration of the business is completed by year-end 2017. We believe the acquisitions of BLS and the Lumata Entities further reinforces our commitment to the customer acquisition and customer value management (“CVM”) domains that began with the acquisition of Sixth Sense Media (“ Evolving Systems NC, Inc.”) . With these recent acquisitions, we now have a customer base of over 90 customers spanning 66 countries across the world. The experienced team and technology from BLS, which provides actionable insights and relevant offers based on customer data, greatly complements our software portfolio and 25 years of expertise in customer acquisition, activation and retention. The technology further expands our Managed Services platform for delivering on-tap strategic and tactical solutions. The Lumata Entities' value lies in its patented technology, industry expertise and strong customer relationships, in particular, those across Western Europe. Led by the explosive growth in mobile, the next generation of CVM is moving beyond traditional CRM and points based loyalty systems to highly personalized and contextual, real-time, omni-channel consumer engagement in multiple verticals including telecom, finance, and retail. The acquisition of the Lumata Entities is another milestone in Evolving Systems' transformation from its position as a market leader in customer acquisition, development and retention serving the telecommunication industry. Through the growth of its CVM technology and portfolio, Evolving Systems is positioned to be a next-generation mobile consumer engagement solutions accelerator across multiple industry verticals. While the Company remains a market leader in core service activation and number management services through established solutions like Tertio and Dynamic SIM Allocation that transformed how customers buy and activate phones, Evolving Systems has also become a leader in Customer Value Management (CVM) solutions through the acquisition of leading real-time marketing specialists including Evolving Systems NC, Inc. in September 2015. This uniquely enables Evolving Systems to provide an end-to-end solution portfolio addressing all stages of the customer lifecycle from activation through retention, allowing the marketing teams to accelerate both reach and customer acquisition, drive ARPU, reward tenure, and accelerate digital adoption leveraging big data analytics and real-time triggers to target customers when it matters most. Our strategic focus is primarily on delivering a significant competitive advantage to organizations with a large subscriber base in the telecom, banking, retail and other sectors. Reaching a potential 1.9 billion subscribers each day, the Company helps its customers grow market share, increase average revenue per user (ARPU), stem churn or improve business efficiencies in a dynamic market. These acquisitions will enable growth of our CVM technology and portfolio, which will position us to be a next-generation mobile consumer engagement solutions accelerator across multiple industry verticals. Interim Consolidated Financial Statements — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conformity with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these consolidated financial statements are adequate to make the information presented not misleading. The unaudited condensed consolidated financial statements included in this document have been prepared on the same basis as the annual consolidated financial statements, and in our opinion reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with GAAP and SEC regulations for interim consolidated financial statements. The results for the three and nine months ended September 30, 2017 are not necessarily indicative of the results that we will have for any subsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to those statements for the year ended December 31, 2016 included in our Annual Report on Form 10-K. Reclassifications - Certain reclassifications have been made to the 2016 financial statements to conform to the consolidated 2017 financial statement presentation. These reclassifications had no effect on net earnings or cash flows as previously reported. Use of Estimates — The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, at the date of the consolidated financial statements, as well as the reported amounts of revenue and expenses during the reporting period. We made estimates with respect to revenue recognition for estimated hours to complete projects accounted for using the percentage-of-completion method, allowance for doubtful accounts, income tax valuation allowance, fair values of long-lived assets, valuation of intangible assets and goodwill, useful lives for property, equipment and intangible assets, business combinations, capitalization of internal software development costs and fair value of stock-based compensation amounts. Actual results could differ from these estimates. Foreign Currency — Our functional currency is the U.S. dollar. The functional currency of our foreign operations is the respective local currency for each foreign subsidiary. Assets and liabilities of foreign operations denominated in local currencies are translated at the spot rate in effect at the applicable reporting date. Our consolidated statements of income are translated at the weighted average rate of exchange during the applicable period. The resulting unrealized cumulative translation adjustment is recorded as a component of accumulated other comprehensive loss in stockholders’ equity. Realized and unrealized transaction gains and losses generated by transactions denominated in a currency different from the functional currency of the applicable entity are recorded in other income (expense) in the consolidated statements of operations in the period in which they occur. Principles of Consolidation — The unaudited condensed consolidated financial statements include the accounts of Evolving Systems, Inc. and subsidiaries, all of which are wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation. Goodwill — Goodwill is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired. Goodwill is not amortized, but tested for impairment annually or whenever indicators of impairment exist. These indicators may include a significant change in the business climate, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors. Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to the reporting unit, and determination of the fair value of the reporting unit. Intangible Assets — Amortizable intangible assets consist primarily of purchased software and licenses, customer relationships, trademarks and tradenames, non-competition and purchased software acquired in conjunction with our purchase of Telespree Communications (“Evolving Systems Labs, Inc.”), Evolving Systems NC, Inc., BLS and the Lumata Entities. These assets are amortized using the straight-line method over their estimated lives. We asses s the impairment of identifiable intangibles if events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. If we determine that the carrying value of intangibles and/or long-lived assets may not be recoverable, we compare the estimated undiscounted cash flows expected to result from the use of the asset and its eventual disposition to the asset’s carrying amount. If an amortizable intangible or long-lived asset is not deemed to be recoverable, we recognize an impairment loss representing the excess of the asset’s carrying value over its estimated fair value. Fair Value Measurements — Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. Cash and Cash Equivalents — All highly liquid investments with maturities of three months or less at the date of purchase are classified as cash equivalents. Revenue Recognition — We recognize revenue when an agreement is signed, the fee is fixed or determinable and collectability is reasonably assured. We recognize revenue from two primary sources: license fees and services. The majority of our license fees and services revenue is generated from fixed-price contracts, which provide for licenses to our software products and services to customize such software to meet our customers’ use. When the customization services are determined to be essential to the functionality of the delivered software, we recognize revenue using the percentage-of-completion method of accounting. In these types of arrangements, we do not typically have vendor specific objective evidence (“VSOE”) of fair value on the license fee/services portion (services are related to customizing the software) of the arrangement due to the large amount of customization required by our customers; however, we do have VSOE for the warranty/maintenance services based on the renewal rate of the first year of maintenance in the arrangement. The license/services portion is recognized using the percentage-of-completion method of accounting and the warranty/maintenance services are separated based on the renewal rate in the contract and recognized ratably over the warranty or maintenance period. We estimate the percentage-of-completion for each contract based on the ratio of direct labor hours incurred to total estimated direct labor hours and recognize revenue based on the percent complete multiplied by the contract amount allocated to the license fee/services. Since estimated direct labor hours, and changes thereto, can have a significant impact on revenue recognition, these estimates are critical and we review them regularly. If the arrangement includes a customer acceptance provision, the hours to complete the acceptance testing are included in the total estimated direct labor hours; therefore, the related revenue is recognized as the acceptance testing is performed. Revenue is not recognized in full until the customer has provided proof of acceptance on the arrangement. Generally, our contracts are accounted for individually. However, when certain criteria are met, it may be necessary to account for two or more contracts as one to reflect the substance of the group of contracts. We record amounts billed in advance of services being performed as unearned revenue. Unbilled work-in-progress represents revenue earned but not yet billable under the terms of the fixed-price contracts. All such amounts are expected to be billed and collected within 12 months. We may encounter budget and schedule overruns on fixed-price contracts caused by increased labor or overhead costs. We make adjustments to cost estimates in the period in which the facts requiring such revisions become known. We record estimated losses, if any, in the period in which current estimates of total contract revenue and contract costs indicate a loss. If revisions to cost estimates are obtained after the balance sheet date but before the issuance of the interim or annual financial statements, we make adjustments to the interim or annual financial statements accordingly. In arrangements where the services are not essential to the functionality of the delivered software, we recognize license revenue when a license agreement has been signed, delivery and acceptance have occurred, the fee is fixed or determinable and collectability is reasonably assured. Where applicable, we unbundle and record as revenue fees from multiple element arrangements as the elements are delivered to the extent that VSOE of fair value of the undelivered elements exist. If VSOE for the undelivered elements does not exist, we defer fees from such arrangements until the earlier of the date that VSOE does exist on the undelivered elements or all of the elements have been delivered. We recognize revenue from fixed-price service contracts using the proportional performance method of accounting, which is similar to the percentage-of-completion method described above. We recognize revenue from professional services provided pursuant to time-and-materials based contracts and training services as the services are performed, as that is when our obligation to our customers under such arrangements is fulfilled. We recognize revenue from our managed services contracts primarily ratably over the service contract period. On occasion, our managed services contracts will contain a specified number of hours to work over the term of the contract. Revenue for this type of managed service contract is recognized using the proportional performance method of accounting. We recognize revenue from our MDE contracts based on the number of transactions per month multiplied by a factor based on a unique table for transaction volumes relating to each account. We recognize customer support, including maintenance revenue, ratably over the service contract period. When maintenance is bundled with the original license fee arrangement, its fair value, based upon VSOE, is deferred and recognized during the periods when services are provided. We review and update our contract-related estimates regularly. The impact of an adjustment in estimate is recognized prospectively over the remaining contract term. No adjustment on any one contract was material to our unaudited Consolidated Financial Statements in the three and nine months ended September 30, 2017 and 2016. Stock-based Compensation — We account for stock-based compensation by applying a fair-value-based measurement method to account for share-based payment transactions with employees and directors. We record compensation costs associated with the vesting of unvested options on a straight-line basis over the vesting period. Stock-based compensation is a non-cash expense because we settle these obligations by issuing shares of our common stock instead of settling such obligations with cash payments. We use the Black-Scholes model to estimate the fair value of each option grant on the date of grant. This model requires the use of estimates for expected term of the options and expected volatility of the price of our common stock. The fair market value of restricted shares for share-based compensation expensing is equal to the closing price of our common stock on the date of grant. Of the restrictions on the stock awards granted during the three months ended March 31, 2017 and June 30, 2017, 20% will be released in January 2018, and 10% annually beginning on the one year anniversary of their offering thereafter for four years. The remaining 40 % will be released evenly over four years beginning in 2018 contingent upon the attainment of annual performance goals established by our Board of Directors. Of the restrictions on the stock awards granted during the three months ended September 30, 2017, one-fourth will be released on the one-year anniversary of the date of the grant and the balance will be released quarterly over a three year period. Comprehensive Income (Loss) — Comprehensive income (loss) consists of two components, net income and other comprehensive income (loss). Other comprehensive income (loss) refers to revenue, expenses, gains, and losses that under GAAP are recorded as an element of shareholders’ equity but are excluded from net income. Other comprehensive income (loss) consists of foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency. Restricted Cash – As of June 30, 2017 we had $1.6 million of restricted cash related to the pending asset purchase of Business Logic Systems Limited. The restricted cash became unrestricted as of July 3, 2017, once the purchase was consummated, and was applied to the purchase. As of September 30, 2017 we had no restricted cash. Income Taxes — We record deferred tax assets and liabilities for the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported in the accompanying condensed consolidated balance sheets, as well as operating losses and tax credit carry-forwards. We measure deferred tax assets and liabilities using enacted tax rates expected to be applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. We reduce deferred tax assets by a valuation allowance if, based on available evidence, it is more likely than not that these benefits will not be realized. We use a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. Segment Information — We define operating segments as components of our enterprise for which separate financial information is reviewed regularly by the chief operating decision-makers to evaluate performance and to make operating decisions. We have identified our Chief Executive Officer and Senior Vice President of Finance as our chief operating decision-makers (“CODM”). These chief operating decision makers review revenues by segment and review overall results of operations. We currently operate our business as one operating segment which includes two revenue types: license fees revenue and services revenue (as shown on the condensed consolidated statements of income). License fees revenue represents the fees received from the license of software products. Services revenue includes services directly related to the delivery of the licensed products, such as fees for custom development, integration services, SaaS service, managed services, annual support fees, recurring maintenance fees, fees for maintenance upgrades and warranty services. Warranty services that are similar to software maintenance services are typically bundled with a license sale. Recent Accounting Pronouncements – In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers,” Topic 606. This Update affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. The guidance in this Update supersedes the revenue recognition requirements in Topic 605, Revenue Recognition and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to illustrate the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance also includes a cohesive set of disclosure requirements that will provide users of financial statements with comprehensive information about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a reporting organization’s contracts with customers. In April 2016, the FASB issued ASU No. 2016-10, “Revenue from Contracts with Customers,” Topic 606: “Identifying Performance Obligations and Licensing”. This Update clarifies guidance related to identifying performance obligations and licensing implementation guidance contained in the new revenue recognition standard. The Update includes targeted improvements based on input the Board received from the Transition Resource Group for Revenue Recognition and other stakeholders. The update seeks to proactively address areas in which diversity in practice potentially could arise, as well as to reduce the cost and complexity of applying certain aspects of the guidance both at implementation and on an ongoing basis. In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts with Customers,” Topic 606: “Narrow-Scope Improvements and Practical Expedients”. The amendments in this Update address narrow-scope improvements to the guidance on collectability, noncash consideration, and completed contracts at transition. Additionally, the amendments in this Update provide a practical expedient for contract modifications at transition and an accounting policy election related to the presentation of sales taxes and other similar taxes collected from customers. This ASU is the final version of Proposed Accounting Standards Update 2015-320, “Revenue from Contracts with Customers,” (Topic 606): “Narrow-Scope Improvements and Practical Expedients,” which has been deleted. In December 2016, the FASB issued ASU No. 2016-20, “Revenue from Contracts with Customers,” Topic 606: “Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers”. The amendments in this Update address narrow-scope improvements to the guidance on loan guarantee fees, contract cost-impairment testing, contract costs-interaction of impairment testing with guidance in other topics, provision for losses on construction-type and production-type contracts, scope of topic 606 to exclude all contracts that are within the scope of Topic 944, disclosure of remaining performance obligations, disclosure of prior-period performance obligations, contract modifications, contract asset versus receivable, refund liability, advertising costs, fixed-odds wagering contracts in the casino industry and cost capitalization for advisors to private funds and public funds. The Board decided to issue a separate Update for technical corrections and improvements to Topic 606 and other Topics amended by Update 2014-09 to increase stakeholders’ awareness of the proposals and to expedite improvements to Update 2014-09. This ASU is effective for fiscal years, and interim periods within those years beginning after December 15, 2017 for public companies and 2018 for non-public entities. We do not expect the adoption of this standard to have a significant impact on our financial position and results of operations. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires lessees to put most leases on their balance sheets by recognizing a lessee’s rights and obligations, while expenses will continue to be recognized in a similar manner to today’s legacy lease accounting guidance. This ASU could also significantly affect the financial ratios used for external reporting and other purposes, such as debt covenant compliance. This ASU will be effective for us on January 1, 2019, with early adoption permitted. We are currently in the process of assessing the impact of this ASU on our consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350), which includes provisions intended to simplify the test for goodwill impairment. The standard is effective for annual periods beginning after December 15, 2019, with early adoption permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not expect the adoption of this standard to have a significant impact on our financial position and results of operations. Recently Adopted Accounting Pronouncements – In March 2016, the FASB issued ASU No. 2016-09, Stock Compensation (Topic 718), which includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. The standard is effective for annual periods beginning after December 15, 2016. We adopted this ASU during the first quarter 2017. The key effects of the adoption on our financial statements include that the Company will now recognize windfall tax benefits as deferred tax assets instead of tracking the windfall pool and recording such benefits in equity. Additionally, we have elected to recognize forfeitures as they occur rather than estimating them at the time of grant In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted cash, which requires the statement of cash flows explain the change during the period in the combined total of restricted and unrestricted balances in the statement of cash flows. Therefore, amounts described as restricted cash and restricted cash equivalents should be combined with the unrestricted cash and cash equivalents when reconciling the beginning and end of period balances on the statement of cash flow. The standard is effective for annual periods beginning after December 15, 2017, and interim periods within the fiscal years. We adopted this ASU during the second quarter 2017. The key effects of the adoption on our financial statements include that the statement of cash flows now presents a transfer of restricted cash from a cash balance as a cash transaction. As such, a restricted cash is now classified as operating, investing, or financing, as appropriate. |
Acquisition
Acquisition | 9 Months Ended |
Sep. 30, 2017 | |
Acquisition [Abstract] | |
Acquisition | NOTE 2 — ACQUISITION On July 3, 2017, we completed the purchase by BLS Limited (“EVOL BLS”), a wholly owned subsidiary of Evolving Systems, Inc., a Delaware corporation (the “Company”), of Business Logic Systems Limited (“Seller”). EVOL BLS and Seller are both companies incorporated under the laws of England and Wales. Under the terms of the Asset Purchase Agreement, dated as of May 5, 2017 (the “Purchase Agreement”), the Seller will sell substantially all of its assets and transfer certain liabilities relating to Seller’s business of providing customer value management solutions and data driven marketing solutions for £1.2 million ( $1.6 million) in cash, plus (a) an additional sum of £100,000 ( $134,000 ), which was reduced in full by the sums paid by EVOL BLS to certain employees’ severance obligations (collectively, the “Cash Payments”); (b) a percentage of collections on certain receivables over a 24 month period; and (c) an earnout equal to 50% of BLS based revenue over $4.8 million per year for 3 years after the closing date. The Company agreed to guarantee EVOL BLS’ obligations under the Purchase Agreement. The Purchase Agreement contains a two year “no solicitation” provision which restricts the Seller’s ability to compete with EVOL BLS with respect to the BLS business or to solicit BLS customers or BLS employees serving in an executive, managerial, sales or technical role. We accounted for this business combination by applying the acquisition method, and accordingly, the purchase price was allocated to the assets and liabilities assumed based upon their fair values at the acquisition date. The excess of the purchase price over the net assets and liabilities, approximately $0.1 million, was recorded as goodwill. The results of EVOL BLS’s operations have been included in the consolidated financial statements since the acquisition date. The amortization of the intangible assets is deductible for tax purposes. Total purchase price is summarized as follows (in thousands): July 3, 2017 Cash Consideration Total Cash Consideration $ 1,558 Earnout 380 Total purchase price $ 1,938 The following table summarizes the preliminary estimated fair values of the assets and liabilities assumed at the acquisition date (in thousands): July 3, 2017 Contract receivables $ 962 Unbilled work-in-progress 1,278 Intangible assets 205 Prepaid and other current assets 437 Other assets, non-current 55 Total identifiable assets acquired $ 2,937 Accounts payable and accrued liabilities $ 792 Deferred revenue 338 Total identifiable liabilities acquired $ 1,130 Net identifiable assets acquired 1,807 Goodwill 131 Net assets acquired $ 1,938 We recorded $0.2 million in intangible assets as of the acquisition date with a weighted-average amortization period of approximately six years and are amortizing the value of the purchased software, trademarks and trade names, non-competition and customer relationships over an estimated useful life of 5, 0.5, 2 and 7 years, respectively. Amortization expense of approximately $12,000 related to the acquired intangible assets was recorded during the three and nine months ended September 30, 2017. The $0.1 million of the goodwill recognized is attributed primarily to expected synergies and the assembled workforce of EVOL BLS. As of the date of this report there were no changes in the recognized amounts of goodwill resulting from the acquisition of EVOL BLS. Intangible assets related to the EVOL BLS’s acquisition as of September 30, 2017 (in thousands): September 30, 2017 Gross Amount Effects of changes in foreign currency exchange rates Net Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 83 $ 3 $ 86 $ 4 $ 82 5 yrs Trademarks and tradenames 6 1 7 3 4 0.5 yrs Non-competition 4 - 4 1 3 2 yrs Customer relationships 112 3 115 4 111 7 yrs $ 205 $ 7 $ 212 $ 12 $ 200 5.88 yrs On September 4, 2017, Evolving Systems Holdings Limited (“EVOL Holdings”), a wholly owned subsidiary of Evolving Systems, Inc., completed the acquisition under a Share Purchase Agreement (the “Purchase Agreement”) with Lumata Holdings Limited (“Lumata Holdings” or “Seller”) and Francisco Partners III (Cayman) L.P, as Guarantor (the “Acquisition”). EVOL Holdings acquired all of the issued and outstanding shares of four (4) Lumata Holdings subsidiaries, Lumata France SAS, Lumata Spain S.L., Lumata UK Ltd and Lumata Deutschland GmbH (collectively, “Lumata Entities”) in exchange for a cash payment totaling €4.0 million ( $4.8 million ), subject to certain adjustments. The Seller and certain members of the Seller’s management entered into Management Warranty Deeds to secure Lumata Holdings’ representations and warranties under the Purchase Agreement and, to the extent the amounts provided under the Management Warranty Deeds are not sufficient to satisfy post-closing claims, EVOL Holdings may seek recovery from the Guarantor in an amount not to exceed €400,000 ( $476,000 ). EVOL Holdings and Seller are both companies incorporated under the laws of England and Wales. We accounted for this business combination by applying the acquisition method, and accordingly, the purchase price was allocated to the assets and liabilities assumed based upon their fair values at the acquisition date. The excess of the purchase price over the net assets and liabilities, approximately $2.7 million, was recorded as goodwill. The Company is in the process of finalizing the purchase allocation, thus the provisional measures of deferred income taxes, intangibles and goodwill are subject to change. The Company expects the purchase price allocation will be finalized in 2018. The results of the Lumata Entities ’ operations have been included in the consolidated financial statements since the acquisition date. The amortization of the intangible assets is not deductible for tax purposes. Total purchase price is summarized as follows (in thousands): September 4, 2017 Cash Consideration Total Cash Consideration $ 4,766 Total purchase price $ 4,766 The following table summarizes the preliminary estimated fair values of the assets and liabilities assumed at the acquisition date (in thousands): September 4, 2017 Cash and cash equivalents $ 386 Contract receivables 1,444 Unbilled work-in-progress 110 Intangible assets 1,935 Prepaid and other current assets 1,539 Other assets, non-current 19 Total identifiable assets acquired $ 5,433 Accounts payable and accrued liabilities $ 3,086 Deferred tax liability 329 Deferred revenue 325 Total identifiable liabilities acquired $ 3,740 Net identifiable assets acquired 1,693 Goodwill 3,073 Net assets acquired $ 4,766 We recorded $1.9 million in intangible assets as of the acquisition date with a weighted-average amortization period of approximately ten years and are amortizing the value of the purchased software, trademarks and tradename, non-competition and customer relationships over an estimated useful life of 7, 5, 1.5 and 13 years, respectively. Amortization expense of approximately $18,000 related to the acquired intangible assets was recorded during the period ended September 30, 2017. The $3.1 million of goodwill recognized is attributed to expected synergies and the assembled workforce and residual goodwill of the Lumata Entities. As of the date of this report there were no changes in the recognized amounts of goodwill resulting from the acquisition of the Lumata Entities. Intangible assets related to the Lumata Entities’ acquisition as of September 4, 2017 (in thousands): September 30, 2017 Gross Amount Effects of changes in foreign currency exchange rates Net Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 672 $ 23 $ 695 $ 8 $ 687 7 yrs Trademarks and tradenames 111 4 115 2 113 5 yrs Non-competition 2 - 2 - 2 1.5 yrs Customer relationships 1,150 40 1,190 8 1,182 13 yrs $ 1,935 $ 67 $ 2,002 $ 18 $ 1,984 10.45 yrs |
Goodwill And Intangible Assets
Goodwill And Intangible Assets | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill And Intangible Assets [Abstract] | |
Goodwill And Intangible Assets | NOTE 3 — GOODWILL AND INTANGIBLE ASSETS Changes in the carrying amount of goodwill by reporting unit were as follows (in thousands): Total Goodwill Balance at December 31, 2016 $ 20,599 Goodwill acquired during the year 3,204 Effects of changes in foreign currency exchange rates (1) 1,153 Balance at September 30, 2017 $ 24,956 (1) Represents the impact of foreign currency translation for instances when goodwill is recorded in foreign entities whose functional currency is also their local currency. Goodwill balances are translated into U.S. dollars using exchange rates in effect at period end. Adjustments related to foreign currency translation are included in other comprehensive income. We performed our annual goodwill impairment test as of July 31, 2017, at which time we had $21.5 million of goodwill. The fair value of the reporting unit was estimated using both market and income based approaches. Specifically, we incorporated observed market multiple data from selected guideline public companies and values arrived at through the application of discounted cash flow analyses, which in turn were based upon our financial projections as of the valuation date. We believe that a market participant would weigh both possibilities without a bias to one or the other. Consequently, we gave equal consideration to both. This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital. Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment for each reporting unit. If the carrying value of a reporting unit were to exceed its fair value, we would then compare the fair value of the reporting unit’s goodwill to its carrying amount, and any excess of the carrying amount over the fair value would be charged to operations as an impairment loss. If the projected future performance of our segment as estimated in the income valuation approach is adjusted downward or is lower than expected in the future, we could be required to record a goodwill impairment charge. As a result of the first step of the 2017 goodwill impairment analysis, the fair value of each reporting unit exceeded its carrying value. Therefore the second step was not necessary. Due to our transition of packaging our products and services into a managed service offering, we have determined we have one reporting unit. We do not believe the aggregation of our reporting units impacts the value of our goodwill nor are there any events through the date this Form 10-Q was filed which impacts our assumptions on the determination of the fair value of our goodwill. We amortized identifiable intangible assets for Evolving Systems Labs, Inc., Evolving Systems NC, Inc., EVOL BLS, and the Lumata Entities on a straight-line basis over their estimated lives ranging from one to eight years. As of September 30, 2017 and December 31, 2016, identifiable intangibles were as follows (in thousands): September 30, 2017 December 31, 2016 Gross Amount Effects of changes in foreign currency exchange rates Net Amount Accumulated Amortization Net Carrying Amount Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 2,873 $ 27 $ 2,900 $ 647 $ 2,253 $ 2,118 $ 436 $ 1,682 7.7 yrs Trademarks and tradenames 302 4 306 177 129 185 116 69 3.7 yrs Non-competition 39 - 39 34 5 33 21 12 2.0 yrs Customer relationships 4,286 44 4,330 920 3,410 3,024 587 2,437 8.7 yrs $ 7,500 $ 75 $ 7,575 $ 1,778 $ 5,797 $ 5,360 $ 1,160 $ 4,200 8.1 yrs Amortization expense of identifiable intangible assets was $ 0 .2 million for the three months and $0.6 million for the nine months ended September 30, 2017 and 2016, respectively. Expected future amortization expense related to identifiable intangibles based on our carrying amount as of September 30, 2017 was as follows (in thousands): Twelve months ending September 30, 2018 $ 960 2019 944 2020 940 2021 940 2022 859 Thereafter 1,154 $ 5,797 |
Earnings Per Common Share
Earnings Per Common Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Common Share [Abstract] | |
Earnings Per Common Share | NOTE 4 — EARNINGS PER COMMON SHARE We compute basic earnings per share (“EPS”) by dividing net income or loss available to common stockholders by the weighted average number of shares outstanding during the period, including common stock issuable under participating securities. We compute diluted EPS using the weighted average number of shares outstanding, including participating securities, plus all potentially dilutive common stock equivalents. Common stock equivalents consist of stock options and restricted stock. Our policy is to treat unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, as participating securities, included in the computation of both basic and diluted earnings per share. We exclude unvested restricted stock from our basic earnings per share. Our restricted stock, which vests based on the passage of time are included in dilutive earnings per share. Our restricted stock which vests contingent upon the attainment of annual performance goals are included in dilutive earnings per share as the performance goals are achieved. The following is the reconciliation of the denominator of the basic and diluted EPS computations (in thousands, except per share data): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2017 2016 2017 2016 Basic income per share: Net income available to common stockholders $ 759 $ 941 $ 2,834 $ 2,148 Basic weighted average shares outstanding 11,940 11,873 11,932 11,824 Basic income per share: $ 0.06 $ 0.08 $ 0.24 $ 0.18 Diluted income per share: Net income available to common stockholders $ 759 $ 941 $ 2,834 $ 2,148 Weighted average shares outstanding 11,940 11,873 11,932 11,824 Effect of dilutive securities - options and restricted stock 52 106 43 143 Diluted weighted average shares outstanding 11,992 11,979 11,975 11,967 Diluted income per share: $ 0.06 $ 0.08 $ 0.24 $ 0.18 For the three months ended September 30, 2017 and 2016, 0.4 million and 0.5 million shares, respectively, of common stock were excluded from the dilutive stock calculation because their exercise prices were greater than the average fair value of our common stock for the period. For the nine months ended September 30, 2017 and 2016, 0.4 million and 0.5 million shares, respectively, of common stock were excluded from the dilutive stock calculation because their exercise prices were greater than the average fair value of our common stock for the period. For the three and nine months ended September 30, 2017, 0.6 million shares of unvested restricted stock were excluded from basic earnings per share but a portion of the 0.6 million shares were included in dilutive earnings per share. No shares of restricted stock were excluded from basic or dilutive earnings per share for the three and nine months ended September 30, 2016. |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Sep. 30, 2017 | |
Share-Based Compensation [Abstract] | |
Share-Based Compensation | NOTE 5 — SHARE-BASED COMPENSATION We account for stock-based compensation by applying a fair-value-based measurement method to account for share-based payment transactions with employees and directors, and record compensation cost for all stock awards granted after January 1, 2006 and awards modified, repurchased, or cancelled after that date, using the modified prospective method. We record compensation costs associated with the vesting of unvested options on a straight-line basis over the vesting period. We recogn ized $0.2 million and $0.1 million of compensation expense in the consolidated statements of operations, with respect to our stock-based compensation plans for the three months ended September 30, 2017 and 2016 and $0.5 million and $0.2 million for the nine months ended September 30, 2017 and 2016 respectively The following table summarizes stock-based compensation expenses recorded in the consolidated statement of operations (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2017 2016 2017 2016 Cost of revenue, excluding depreciation and amortization $ 4 $ 8 $ 15 $ 32 Sales and marketing 5 7 9 20 General and administrative 199 20 414 90 Product development 14 17 48 56 Total share based compensation $ 222 $ 52 $ 486 $ 198 Stock Incentive Plans In June 2007, our stockholders approved the 2007 Stock Incentive Plan (the “2007 Stock Plan”) with a maximum of 1,000,000 shares reserved for issuance. In June 2010, our stockholders approved an amendment to the 2007 Stock Plan which increased the maximum shares that may be awarded under the plan to 1,250,000 . In June 2013, our stockholders approved an amendment to the 2007 Stock Plan which increased the maximum shares that may be awarded under the plan to 1,502,209 . In June 2015, our stockholders approved an amendment to the 2007 Stock Plan which increased the maximum shares that may be awarded under the plan to 2,002,209 . Awards permitted under the 2007 Stock Plan include: Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Awards and Other Stock-Based Awards. Awards issued under the 2007 Stock Plan are at the discretion of the Board of Directors. As applicable, awards are granted with an exercise price equal to the closing price of our common stock on the date of grant, generally vest over four years for employees and three years for an initial grant and one year for subsequent grants for directors and expire no more than ten years from the date of grant. At September 30, 2017, no shares were available for grant under the 2007 Stock Plan, as amended. At September 30, 2017 and December 31, 2016, 0.8 million and 0.7 million were issued and outstanding under the 2007 Stock Plan as amended, respectively. In June 2016, our stockholders approved the 2016 Stock Incentive Plan (the “2016 Stock Plan”) with a maximum of 250,000 shares reserved for issuance. In June 2017, our stockholders approved an amendment to the 2016 Stock Plan which increased the maximum shares that may be awarded under the plan to 650,000 . Awards permitted under the 2016 Stock Plan include: Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Awards and Other Stock-Based Awards. Awards issued under the 2016 Stock Plan are at the discretion of the Board of Directors. As applicable, awards are granted with an exercise price equal to the closing price of our common stock on the date of grant, generally vest over four years for employees and three years for an initial grant and one year for subsequent grants for directors and expire no more than ten years from the date of grant. At September 30, 2017, there were approximately 0.3 million shares available for grant under the 2016 Stock Plan. At September 30, 2017 and December 31, 2016, 0.3 million and 0 shares were issued and outstanding under the 2016 Stock Plan, respectively. During the three months ended September 30, 2017 7,500 shares of restricted stock were granted to a member of our senior management. During the nine months ended September 30, 2017 0.6 million shares of restricted stock were granted to members of our Board of Directors and senior management. During the three and nine months ended September 30, 2016 no shares of restricted stock were granted to members of our Board of Directors or senior management. During the three months ended September 30, 2017 1,250 shares of restricted stock vested. During the nine months ending September 30, 2017 3,750 shares of restricted stock vested. During the three and nine months ended September 30, 2016 5,000 shares of restricted stock vested. During the three and nine months ended September 30, 2017 4,000 and 27,000 of restricted stock were forfeited, respectively. No shares of restricted stock were forfeited during the three and nine months ended September 30, 2016. The fair market value of restricted shares for share-based compensation expensing is equal to the closing price of our common stock on the date of grant. Stock-based compensation expense includes $ 0.2 million and $ 8,000 for the three months ended September 30, 2017 and 2016, respectively, and $0.4 million and $23,000 for the nine month ended September 30, 2017 and 2016, respectively, of expense related to restricted stock grants. Of the restrictions on the stock awards granted during the six months ended June 30, 2017, 20% will be released in January 2018, and 10% annually beginning on the one year anniversary of their offering thereafter for four years. The remaining 40% will be released evenly over four years beginning in 2018 contingent upon the attainment of annual performance goals established by our Board of Directors. Of the restrictions on the stock awards granted during the three months ended September 30, 2017, one -fourth will be released on the one -year anniversary of the date of the grant and the balance will be released quarterly over a three year period. The following is a summary of restricted stock option activity under the plans for the three and nine months ended September 30, 2017: Restricted Stock Number of Shares (in thousands) Shares outstanding at December 31, 2016 15 Restricted stock granted 615 Less restricted stock forfeited (27) Less restricted stock vested (4) Shares outstanding at September 30, 2017 599 The fair value of each option grant is estimated on the date of grant using the Black-Scholes model. The Black-Scholes model uses four assumptions to calculate the fair value of each option grant. The expected term of share options granted is derived using the simplified method, which we adopted in January 2008. The risk-free interest rate is based upon the rate currently available on zero-coupon U.S. Treasury instruments with a remaining term equal to the expected term of the stock options. The expected volatility is based upon historical volatility of our common stock over a period equal to the expected term of the stock options. The expected dividend yield is based upon anticipated payment of dividends. The weighted-average assumptions used in the fair value calculations are as follows: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2017 2016 2017 2016 Expected term (years) 6.4 6.0 6.4 6.0 Risk-free interest rate 1.88 % 1.10 % 1.88 % 1.32 % Expected volatility 38.74 % 36.55 % 38.74 % 36.81 % Expected dividend yield 0.00 % 4.23 % 0.00 % 7.22 % The following is a summary of stock option activity under the plans for the nine months ended September 30, 2017: Weighted- Average Weighted- Remaining Aggregate Number of Average Contractual Intrinsic Shares Exercise Term Value (in thousands) Price (Years) (in thousands) Options outstanding at December 31, 2016 684 $ 6.17 7.30 $ 139 Options granted 50 4.65 Less options forfeited/cancelled (131) 6.58 Less options exercised (108) 3.31 Options outstanding at September 30, 2017 495 $ 6.54 7.47 $ 86 Options exercisable at September 30, 2017 305 $ 6.99 6.82 $ 76 There were 50,000 and 40,000 stock options granted during the three months ended September 30, 2017 and 2016, respectively. There were 50,000 and 118,000 stock options granted during the nine months ended September 30, 2017 and 2016, respectively. The weighted-average grant-date fair value of stock options granted were $1.92 and $1.16 during the three months ended September 30, 2017 and 2016, respectively. As of September 30, 2017, there were approximately $ 2.5 million of total unrecognized compensation costs related to unvested stock options and restricted stock. These costs are expected to be recognized over a weighted average period of 3.38 years. The total fair value of stock options vested during the three months ended September 30, 2017 and 2016 was approximately $38,000 and $0.1 million, respectively. The total fair value of stock options vested during the nine months ended September 30, 2017 and 2016 was approximately $0.1 million and $0.2 million, respectively. The deferred income tax benefits from stock option expense related to Evolving Systems U.K. totaled approximately $3,000 for the three months ended September 30, 2017 and 2016. The deferred income tax benefits from stock option expense related to Evolving Systems U.K totaled approximately $7,000 and $10,000 for the nine months ended September 30, 2017 and 2016, respectively. Cash received from stock option exercises for the three months ended September 30, 2017 and 2016 was $ 3,000 and $ 9,000 , respectively. Cash received from stock option exercises for the nine months ended September 30, 2017 and 2016 was $27,000 and $50,000 respectively. During the nine months ended September 30, 2017, we had net settlement exercises of stock options, whereby the optionee did not pay cash for the options but instead received the number of shares equal to the difference between the exercise price and the market price on the date of exercise. Net settlement exercises during the nine months ended September 30, 2017, resulted in 18,951 shares issued and 75,327 options cancelled in settlement of shares issued. There were no net settlement exercises during the three months ended September 30, 2017. Net settlement exercises during the three and nine months ended September 30, 2016, resulted in approximately 93,782 shares issued and 32,502 options cancelled in settlement of shares issued. Employee Stock Purchase Plan Under the Employee Stock Purchase Plan (“ESPP”), we are authorized to issue up to 550,000 shares. Employees may elect to have up to 15 % of their gross compensation withheld through payroll deductions to purchase our common stock, capped at $ 25,000 annually and no more than 10,000 shares per offering period. The purchase price of the stock is 85 % of the lower of the market price at the beginning or end of each three-month participation period. As of September 30, 2017, there were approximately 51,000 shares available for purchase. For the three months ended September 30, 2017 and 2016, we recorded compensation expense of $90 and $160 , respectively, and $ 600 and $2,000 , for the nine months ended September 30, 2017 and 2016, respectively, associated with grants under the ESPP which includes the fair value of the look-back feature of each grant as well as the 15 % discount on the purchase price. This expense fluctuates each period primarily based on the level of employee participation. The fair value of each purchase made under our ESPP is estimated on the date of purchase using the Black-Scholes model. The Black-Scholes model uses four assumptions to calculate the fair value of each purchase. The expected term of each purchase is based upon the three-month participation period of each offering. The risk-free interest rate is based upon the rate currently available on zero-coupon U.S. Treasury instruments with a remaining term equal to the expected term of each offering. The expected volatility is based upon historical volatility of our common stock. The expected dividend yield is based upon historical and anticipated payment of dividends. The weighted average assumptions used in the fair value calculations are as follows: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2017 2016 2017 2016 Expected term (years) 0.25 0.25 0.25 0.25 Risk-free interest rate 1.06 % 0.27 % 0.97 % 0.23 % Expected volatility 37.08 % 40.28 % 41.72 % 41.56 % Expected dividend yield 0.00 % 5.06 % 0.00 % 7.58 % Cash received from employee stock plan purchases for the three months ended September 30, 2017 and 2016 was $ 344 and $1,000 , respectively. Cash received from employee stock plan purchases for the nine months ended September 30, 2017 and 2016, was $2,000 and $6,000 , respectively. We issued shares related to the ESPP of approximately 80 and 200 for the three months ended September 30, 2017 and 2016, respectively. We issued shares related to the ESPP of approximately 600 and 1,000 for the nine months ended September 30, 2017 and 2016, respectively. |
Concentration Of Credit Risk
Concentration Of Credit Risk | 9 Months Ended |
Sep. 30, 2017 | |
Concentration Of Credit Risk [Abstract] | |
Concentration Of Credit Risk | NOTE 6 — CONCENTRATION OF CREDIT RISK For the three months ended September 30, 2017, one significant customer (defined as contributing at least 10 %) accounted for 12 % of revenue from operations. The significant customer for the three months ended September 30, 2017 is a large telecommunications operator in Europe. For the three months ended September 30, 2016, one significant customer accounted for 13% of revenue from operations. The significant customer for the three months ended September 30, 2016 is a large telecommunications operator in Africa. For the nine months ended September 30, 2017 one significant customer accounted for 13% of revenue from operations. This customer is a large telecommunications operator in Europe. For the nine months ended September 30, 2016, no significant customers accounted for 10% of revenue from operations. As of September 30, 2017 and December 31, 2016, no significant customers accounted for 10 % of contract receivables and unbilled work-in-progress. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2017 | |
Long-Term Debt [Abstract] | |
Long-Term Debt | NOTE 7 — LONG-TERM DEBT On February 29, 2016, we entered into the Fifth Amendment to the Loan and Security Agreement with East West Bank which provides for a Term Loan (the “Term Loan”) for $6.0 million. The $6.0 million loan bears interest at a floating rate equal to the U.S.A. Prime Rate plus 1.0% . As of September 30, 2017, the U.S.A. Prime Rate was 4.25% . The Term Loan is secured by substantially all of the assets of Evolving Systems, Inc., including a pledge, subject to certain limitations with respect to stock of foreign subsidiaries, of the stock of the existing and future direct subsidiaries of Evolving Systems, Inc. Interest shall accrue from the date the Term Loan is made at the aforementioned rate and shall be payable monthly. The Term Loan shall be repaid in 36 equal monthly installments of principal, plus accrued but unpaid interest, commencing on January 1, 2017 and continuing on the first day of each month thereafter through and including January 1, 2020 . On the Term Loan maturity date, the outstanding principal amount of the Term Loan and all accrued and unpaid interest thereon shall be immediately due and payable. The Term Loan, once repaid, may not be reborrowed. We must maintain a minimum current ratio, a specified ratio of Total Liabilities to EBITDA and a minimum fixed charge coverage ratio which are as defined in the Term Loan. The Term Loan requires us to pay two annual credit facility fees of $18,750 and legal fee equal to $1,000 . The Term Loan agreement required us to use the term loan’s proceeds and $4.0 million from our cash balances to pay off and terminate the Revolving Facilities totaling $10.0 million. The Term Loan matures on January 1, 2020. The Term Loan includes negative covenants that place restrictions on the Company’s ability to, among other things: incur additional indebtedness; create liens or other encumbrances on assets; make loans, enter into letters of credit, guarantees, investments and acquisitions; sell or otherwise dispose of assets; cause or permit a change of control; merge or consolidate with another entity; make negative pledges; enter into affiliate transactions; limits the amount of cash distributions to our shareholders; and change the nature of our business materially. Outstanding amounts under the Term Loan may be accelerated by East West Bank upon the occurrence and continuance of certain events of default, including without limitation: payment defaults, breach of covenants beyond applicable grace periods, breach of representations and warranties, bankruptcy and insolvency defaults, and the occurrence of a material adverse effect (as defined). Acceleration is automatic upon the occurrence of certain bankruptcy and insolvency defaults. On August 16, 2017, we entered into a Term Loan Facility Agreement with East West Bank as lender in the amount of $4,730,000 (the “Loan Facility”). The purpose of the Loan Facility is to provide funds in connection with the Company’s entry into a Share Purchase Agreement with Lumata Holdings Limited (“Lumata Holdings”) for a cash payment totaling €4 million ( $4.8 million). See Note 2 Acquisitions for the Lumata Entities acquisition. The Loan Facility requires the Company to make monthly principal payments of approximately $131,400 commencing July 31, 2018 and interest at the greater of (a) 3.5% or (b) the variable rate of interest that appears in the Wall Street Journal on a monthly measurement date plus in either case 1.5% . As of September 30, 2017, the U.S.A. Prime Rate was 4.25% . EVOL Inc. entered into the Loan Facility as the Parent Guarantor; Evolving Systems BLS LTD and Evolving Systems Limited entered into the Loan Facility as Original Guarantors (the “Original Guarantors”). The Loan Facility is secured over all of the assets of EVOL Holdings and the Original Guarantors in accordance with the terms of a Debenture entered into by EVOL Holdings and the Original Guarantors in favor of East West Bank. EVOL Holdings, EVOL Inc. and the Original Guarantors also entered into a Subordination Deed whereby each of the parties agreed to subordinate all loans by and among each other to East West Bank. Following completion of the Lumata Acquisition, Lumata France SAS and Lumata UK Ltd are also bound to adhere to the finance documents as additional obligors. The Loan Facility requires the Company to pay an Arrangement Fee (“Origination Fee”) of $23,650 , payable in 4 equal installments, with the first payment due on the date of the Loan Facility and the remaining three payments on the first, second and third anniversary thereof. The Company also agreed to pay East West Bank’s legal fees in connection with the transaction. The Company may prepay the Loan Facility at any time, in a minimum amount of $250,000 and increments of $50,000 , subject to a prepayment fee of 2% of the amount prepaid, on any prepayment made before the second anniversary date of the Agreement. The unpaid balance of the Loan Facility is due on August 16, 2021 . The Loan Facility includes financial covenants as well as negative covenants that place restrictions on EVOL Holdings, the Parent and Original Guarantors and the additional obligors’ ability to, among other things: incur additional indebtedness; create liens or other encumbrances on assets; make loans, enter into letters of credit, guarantees, investments and acquisitions; sell or otherwise dispose of assets; declare dividends, cause or permit a change of control; merge or consolidate with another entity; enter into affiliate transactions; and change the nature of its business materially, subject to standard exceptions. The Loan Facility has the same covenants as the Term Loan. As of September 30, 2017, we were in compliance with the covenants and had a $9.4 million balance under the Term Loan and Loan Facility net of approximately $ 14,000 of debt issuance costs. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Income Taxes [Abstract] | |
Income Taxes | NOTE 8 — INCOME TAXES We recorded net income tax expense of $ 0.2 million and $0.4 million for the three months ended September 30, 2017 and 2016, respectively. The net expense during the three months ended September 30, 2017 consisted of current income tax expense of $ 0.4 million and a deferred tax benefit of ($0.2 ) million. The current tax expense consists of income tax from our U.S., U.K., France and India based operations. The deferred tax benefit was related primarily to the increase of certain net deferred tax assets and amortization of stock options and the intangible assets related to the acquisition of Evolving Systems NC, Inc. in September 2015. The net expense during the three months ended September 30, 2016 consisted of current income tax expense of $0.3 million and a deferred tax expense of $0.1 million. The current tax expense consists of income tax from our U.S., U.K. and India based operations. The deferred tax expense primarily related to undistributed U.K. foreign earnings offset by the amortization of intangible assets related to the acquisition of Evolving Systems NC, Inc. in September 2015. We recorded net income tax expense of $0 .9 million for the nine months ended September 30, 2017 and 2016. The net expense during the nine months ended September 30, 2017 consisted of current income tax expense of $ 1.2 million and a deferred tax benefit of ( $0.3 ) million. The current tax expense consists of income tax from our U.S., U.K., France and India based operations. The deferred tax benefit was primarily related to the increase of certain net deferred tax assets and amortization of stock options and the intangible assets related to the acquisition of Evolving Systems NC, Inc. The net expense during the nine months ended September 30, 2016 consisted of current income tax expense of $0.9 million and a deferred tax benefit of ( $19,000 ). The current tax expense consists primarily of income tax from our U.K. and India based operations. The deferred tax benefit was primarily related to the amortization of intangible assets related to the acquisition of Evolving Systems NC, Inc. in September 2015 offset by undistributed U.K. foreign earnings. Our effective tax rate was 19% and 31% for the three months ended September 30, 2017 and 2016, respectively. The decrease in our effective tax rate relates to a higher proportion of our income being generated in the U.K., for which the statutory corporate tax rate is lower and the acquisition of subsidiaries with lower effective tax rates. Our effective tax rate was 24% and 30% for the nine months ended September 30, 2017 and 2016 respectively. The decrease in our effective tax rates relates to a higher proportion of our income being generated in the U.K., for which the statutory corporate tax rate is lower and the acquisition of subsidiaries with lower effective tax rates. As of September 30, 2017 and December 31, 2016 we continued to maintain a valuation allowance on portions of our domestic net deferred tax asset. Such assets primarily consist of Foreign Tax Credit (“FTC”), state Net Operating Loss (“NOL”) carryforwards, research and development tax credits and Alternative Minimum Tax (“AMT”) credits. Our deferred tax assets and liabilities as of September 30, 2017 and December 31, 2016, were comprised of the following (in thousands): September 30, 2017 December 31, 2016 Deferred tax assets Foreign tax credits carryforwards $ 4,878 $ 4,360 Net operating loss carryforwards 3,485 544 Research & development credits 303 303 AMT credits 770 770 Stock compensation 707 561 Depreciable assets 87 71 Accrued liabilities and reserves 158 124 Total deferred tax assets 10,388 6,733 Deferred tax liabilities Deferred revenue Undistributed foreign earnings $ (701) $ (662) Intangibles (1,496) (1,339) Total deferred tax liability (2,197) (2,001) Net deferred tax assets, before valuation allowance $ 8,191 $ 4,732 Valuation allowance (8,191) (4,732) Net deferred tax asset $ - $ - In our U.S. Federal income tax returns we historically deducted income taxes paid to various countries. In our 2014 U.S. Federal income tax return we had $2.3 million of NOL carryforwards. Our income tax calculations have historically been under the regular and AMT regulations found in U.S. tax laws. The U.S. tax system contains rules to alleviate the burden of double taxation on income generated in foreign countries and subject to tax in such countries. The U.S. allows for either a deduction or credit of such foreign taxes against U.S. taxable income. An election to either claim a deduction or credit on such foreign income taxes can be made each tax year, independent from elections made in other years. A credit reduces a company’s actual U.S. income tax on a dollar-for-dollar basis, while a deduction reduces only the company’s income subject to tax. We made a comparison of our foreign dividends paid by our foreign subsidiary for which we deducted foreign taxes claimed versus claiming a FTC on the dividend paid by the foreign subsidiary. The dividends received were grossed-up with its corresponding foreign taxes. The U.S. law requires the offset of taxable income with NOL prior to applying the FTC rules. We determined it was beneficial for the company to gross-up the foreign dividends paid by the foreign subsidiary for the years 2012 through 2014 and make the election to claim a FTC. By doing so we fully utilized our December 31, 2014, $2.3 million balance of the federal NOL. As the election to claim the foreign tax credit or deduction is made on an annual basis, we intend to compare benefits to either claim a deduction or foreign tax credit on an annual basis. The company has approximately $ 4.9 million of FTC’s to carryforward through 2017 and subsequent years as a deferred tax asset. Two Indian subsidiaries of SSM were acquired pursuant to the terms of the Agreement and Plan of Merger dated September 30, 2015. We have reason to believe there is uncertainty related to the lack of historical US International reporting for these two foreign subsidiaries, and are in the process of determining whether either or both of these subsidiaries are controlled foreign corporations (“CFCs”) within the meaning of the Internal Revenue Code and related Regulations, or if a “check-the-box” election has taken place to effectively treat one or both of these subsidiaries as disregarded entities for US federal tax reporting purposes. The Company is in the process of obtaining pertinent information to assess the degree of uncertainty and to quantify related costs or liabilities. As of September 30, 2017 and December 31, 2016 we had no liability for unrecognized tax benefits. We conduct business globally and, as a result, Evolving Systems, Inc. or one or more of our subsidiaries file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. Throughout the world, in the normal course of business, we are subject to examination by taxing authorities up until, two years in the U.K. and four years in India, following the end of the accounting period. As of the date of this report, none of our income tax returns are under examination. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2017 | |
Stockholders' Equity [Abstract] | |
Stockholders' Equity | NOTE 9 — STOCKHOLDERS’ EQUITY Certain Anti-Takeover Provisions/Agreements with Stockholders Our restated certificate of incorporation allows the board of directors to issue up to 2,000,000 shares of preferred stock and to determine the price, rights, preferences and privileges of those shares without any further vote or action by our stockholders. The rights of the holders of our common stock will be subject to, and may be adversely affected by, the rights of the holders of any preferred stock that may be issued in the future. Issuance of preferred stock, while providing desired flexibility in connection with possible acquisitions and other corporate purposes could make it more difficult for a third party to acquire a majority of our outstanding voting stock. As of September 30, 2017 and December 31, 2016, no shares of preferred stock were outstanding. In addition, we are subject to the anti-takeover provisions of Section 203 of Delaware General Corporation Law which prohibit us from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the business combination is approved in the prescribed manner. The application of Section 203 may have the effect of delaying or preventing changes in control of our management, which could adversely affect the market price of our common stock by discouraging or preventing takeover attempts that might result in the payment of a premium price to our stockholders. |
Geographical Information
Geographical Information | 9 Months Ended |
Sep. 30, 2017 | |
Geographical Information [Abstract] | |
Geographical Information | NOTE 10 —GEOGRAPHICAL INFORMATION We are headquartered in Englewood, a suburb of Denver, Colorado. We use customer locations as the basis for attributing revenues to individual countries. We provide products and services on a global basis through our headquarters, our London-based Evolving Systems U.K. subsidiary and our North Carolina based Evolving Systems NC, Inc. subsidiary. Additionally, personnel in Bangalore and Kolkata, India provide software development and support services to our global operations. Financial information relating to operations by geographic region is as follows (in thousands): For the Three Months Ended September 30, 2017 Revenue License Services Total United Kingdom $ - $ 1,381 $ 1,381 Other 1,068 5,098 6,166 Total revenues $ 1,068 $ 6,479 $ 7,547 For the Three Months Ended September 30, 2016 Revenue License Services Total United Kingdom $ - $ 722 $ 722 Algeria 799 68 867 Switzerland - 686 686 Other 51 3,777 3,828 Total revenues $ 850 $ 5,253 $ 6,103 For the Nine Months Ended September 30, 2017 Revenue License Services Total United Kingdom $ - $ 3,858 $ 3,858 Other 2,131 13,655 15,786 Total revenues $ 2,131 $ 17,513 $ 19,644 For the Nine Months Ended September 30, 2016 Revenue License Services Total United Kingdom $ - $ 2,622 $ 2,622 Switzerland - 2,109 2,109 Other 2,292 11,638 13,930 Total revenues $ 2,292 $ 16,369 $ 18,661 September 30, December 31, Long-lived assets, net 2017 2016 United States $ 11,476 $ 12,347 United Kingdom 17,753 12,680 Other 1,859 318 $ 31,088 $ 25,345 |
Commitments And Contingencies
Commitments And Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | NOTE 11 — COMMITMENTS AND CONTINGENCIES (a) Other Commitments As permitted under Delaware law, we have agreements with officers and directors under which we agree to indemnify them for certain events or occurrences while the officer or director is, or was, serving at our request in this capacity. The term of the indemnification period is indefinite. There is no limit on the amount of future payments we could be required to make under these indemnification agreements; however, we maintain Director and Officer insurance policies, as well as an Employment Practices Liability Insurance Policy, that may enable us to recover a portion of any amounts paid. As a result of our insurance policy coverage, we believe the estimated fair value of these indemnification agreements is minimal. Accordingly, there were no liabilities recorded for these agreements as of September 30, 2017 or December 31, 2016. We enter into standard indemnification terms with customers and suppliers, in the ordinary course of business, for third party claims arising under our contracts. In addition, as we may subcontract the development of deliverables under customer contracts, we could be required to indemnify customers for work performed by subcontractors. Depending upon the nature of the indemnification, the potential amount of future payments we could be required to make under these indemnification agreements may be unlimited. We may be able to recover damages from a subcontractor or other supplier if the indemnification results from the subcontractor’s or supplier’s failure to perform. To the extent we are unable to recover damages from a subcontractor or other supplier, we could be required to reimburse the indemnified party for the full amount. We have never incurred costs to defend lawsuits or settle claims relating to an indemnification. As a result, we believe the estimated fair value of these agreements is minimal. Accordingly, there were no liabilities recorded for these agreements as of September 30, 2017 or December 31, 2016. Our standard license agreements contain product warranties that the software will be free of material defects and will operate in accordance with the stated requirements for a limited period of time. The product warranty provisions require us to cure any defects through any reasonable means. We believe the estimated fair value of the product warranty provisions in the license agreements in place with our customers is minimal. Accordingly, there were no liabilities recorded for these product warranty provisions as of September 30, 2017 or December 31, 2016. Our software arrangements generally include a product indemnification provision whereby we will indemnify and defend a customer in actions brought against the customer for claims that our products infringe upon a copyright, trade secret, or valid patent of a third party. We have not historically incurred any significant costs related to product indemnification claims. Accordingly, there were no liabilities recorded for these indemnification provisions as of September 30, 2017 or December 31, 2016. In connection with our acquisition of Telespree on October 24, 2013 , we agreed to make a cash payment of $0.5 million on the one year anniversary of the closing. This payment was subject to reduction for certain claims and has not been paid to date. We have made claims against this payment which are currently under dispute. Once settled the final payment will be released. In connection with our acquisition of SSM on September 30, 2015 , we agreed to make a cash payment of $0.3 million on the one year anniversary of the closing. This payment is subject to reduction for certain claims and has not been paid to date. Once settled the final payment will be released. In connection with our acquisition of BLS on July 3, 2017, we agreed to an earnout equal to 50% of BLS based revenue over $4.8 million per year for 3 years after the closing date. The Company also agreed to guarantee EVOL BLS’ obligations under the Purchase Agreement. (b) Litigation From time to time, we are involved in various legal matters arising in the normal course of business. We do not expect the outcome of such proceedings, either individually or in the aggregate, to have a material effect on our financial position, cash flows or results of operations. |
Restructuring
Restructuring | 9 Months Ended |
Sep. 30, 2017 | |
Restructuring [Abstract] | |
Restructuring | NOTE 12 – RESTRUCTURING During the third quarter of 2017, we undertook a reduction in workforce involving the termination of employees resulting in an expense of $0.1 million primarily related to severance for the affected employees. The reduction in workforce was related to the consolidations of duplicative functions and alignment of staff with ongoing business activity as a result of the acquisition of EVOL BLS in the third quarter of 2017. During the third quarter of 2016, we undertook a reduction in workforce involving the termination of employees resulting in an expense adjustment of $3,000 for the three months ending September 30, 2016, primarily related to severance for the affected employees. The reduction in workforce was related to the consolidations of duplicative functions and alignment of staff with ongoing business activity as a result of the acquisition of Evolving Systems NC, Inc. in the third quarter of 2015. For the nine months ending September 30, 2017 and 2016 we had $0.1 million and $1.0 million of restructuring expense, respectively. During the first quarter of 2016, we undertook a reduction in workforce involving the termination of employees resulting in an expense of $0.9 million primarily related to severance for the affected employees. The reduction in workforce was related to the consolidations of duplicative functions and alignment of staff with ongoing business activity as a result of the acquisition of Evolving Systems NC, Inc. in the third quarter of 2015. There was no restructuring liability as of September 30, 2017 and December 31, 2016. |
Basis Of Presentation (Policy)
Basis Of Presentation (Policy) | 9 Months Ended |
Sep. 30, 2017 | |
Basis Of Presentation [Abstract] | |
Organization | Organization — We are a provider of software solutions and services to the wireless, wireline and cable markets. We maintain long-standing relationships with many of the largest wireless, wireline and cable companies worldwide. Our customers rely on us to develop, deploy, enhance and maintain software solutions that provide a variety of service activation and provisioning functions. In 2016, we began a shift from selling technology to offering business solutions. The value proposition has moved from cost savings to revenue increases for the carrier and our business model has moved from classic capex license and services to opex models based on recurring managed services with performance fees. Our software solution platform, Real-time Lifecycle Marketing ™ (“RLM”), enables carriers’ marketing departments to innovate, execute and manage highly-personalized and contextually-relevant, interactive campaigns that engage consumers in real time. Our service activation solution, Tertio ® (“TSA”) is used to activate bundles of voice, video and data services for wireless, wireline and cable network operators; our SIM card activation solution, Dynamic SIM Allocation TM (“DSA”) is used to dynamically allocate and assign resources to Mobile Network Operators (“MNOs”) devices that rely on SIM cards; our Mobile Data Enablement TM (“MDE”) solution provides a data consumption and policy management solution for wireless carriers and Mobile Virtual Network Operators (“MVNOs”) that monitor the usage and consumption of data services; our Total Number Management™ (“TNM”) product is a scalable and fully automated database solution that enables operators to reliably and efficiently manage their telephone numbers as well as other communication identifiers (i.e. SIMs, MSISDNs, IMSIs, ICCIDs, IPs). Our solutions can be deployed on premise or as a Software-as-a-Service (“SaaS”). On July 6, 2017 we announced the completion of the previously announced acquisition of Business Logic Systems (“BLS”). BLS, headquartered in Newbury, UK, specializes in data-driven customer value management and customer engagement solutions that have been implemented in over 20 mobile operators in Europe, Africa, Asia-Pacific and the Caribbean. BLS solutions turn customer data into actionable insights and personalized contextual offers. Customer engagement occurs through in-bound and out-bound offers and is further extended through a suite of loyalty and retention solutions. On September 7, 2017 we announced the completion of the acquisition of four business operating units of Lumata Holdings Ltd. (“the Lumata Entities”). The Lumata Entities are a leading global provider of real-time, next generation loyalty and customer lifecycle management software and services that helps businesses gain value from their customer data for relevant and contextual insights and actions of value to both customers and enterprises. Its customers include mobile operators including Orange, Telefonica and other Tier-1 and emerging operators in Europe and around the world. The acquisition is expected to be accretive to Evolving Systems' operations once the integration of the business is completed by year-end 2017. We believe the acquisitions of BLS and the Lumata Entities further reinforces our commitment to the customer acquisition and customer value management (“CVM”) domains that began with the acquisition of Sixth Sense Media (“ Evolving Systems NC, Inc.”) . With these recent acquisitions, we now have a customer base of over 90 customers spanning 66 countries across the world. The experienced team and technology from BLS, which provides actionable insights and relevant offers based on customer data, greatly complements our software portfolio and 25 years of expertise in customer acquisition, activation and retention. The technology further expands our Managed Services platform for delivering on-tap strategic and tactical solutions. The Lumata Entities' value lies in its patented technology, industry expertise and strong customer relationships, in particular, those across Western Europe. Led by the explosive growth in mobile, the next generation of CVM is moving beyond traditional CRM and points based loyalty systems to highly personalized and contextual, real-time, omni-channel consumer engagement in multiple verticals including telecom, finance, and retail. The acquisition of the Lumata Entities is another milestone in Evolving Systems' transformation from its position as a market leader in customer acquisition, development and retention serving the telecommunication industry. Through the growth of its CVM technology and portfolio, Evolving Systems is positioned to be a next-generation mobile consumer engagement solutions accelerator across multiple industry verticals. While the Company remains a market leader in core service activation and number management services through established solutions like Tertio and Dynamic SIM Allocation that transformed how customers buy and activate phones, Evolving Systems has also become a leader in Customer Value Management (CVM) solutions through the acquisition of leading real-time marketing specialists including Evolving Systems NC, Inc. in September 2015. This uniquely enables Evolving Systems to provide an end-to-end solution portfolio addressing all stages of the customer lifecycle from activation through retention, allowing the marketing teams to accelerate both reach and customer acquisition, drive ARPU, reward tenure, and accelerate digital adoption leveraging big data analytics and real-time triggers to target customers when it matters most. Our strategic focus is primarily on delivering a significant competitive advantage to organizations with a large subscriber base in the telecom, banking, retail and other sectors. Reaching a potential 1.9 billion subscribers each day, the Company helps its customers grow market share, increase average revenue per user (ARPU), stem churn or improve business efficiencies in a dynamic market. These acquisitions will enable growth of our CVM technology and portfolio, which will position us to be a next-generation mobile consumer engagement solutions accelerator across multiple industry verticals. |
Interim Consolidated Financial Statements | Interim Consolidated Financial Statements — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conformity with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these consolidated financial statements are adequate to make the information presented not misleading. The unaudited condensed consolidated financial statements included in this document have been prepared on the same basis as the annual consolidated financial statements, and in our opinion reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with GAAP and SEC regulations for interim consolidated financial statements. The results for the three and nine months ended September 30, 2017 are not necessarily indicative of the results that we will have for any subsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to those statements for the year ended December 31, 2016 included in our Annual Report on Form 10-K. |
Reclassifications | Reclassifications - Certain reclassifications have been made to the 2016 financial statements to conform to the consolidated 2017 financial statement presentation. These reclassifications had no effect on net earnings or cash flows as previously reported. |
Use Of Estimates | Use of Estimates — The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, at the date of the consolidated financial statements, as well as the reported amounts of revenue and expenses during the reporting period. We made estimates with respect to revenue recognition for estimated hours to complete projects accounted for using the percentage-of-completion method, allowance for doubtful accounts, income tax valuation allowance, fair values of long-lived assets, valuation of intangible assets and goodwill, useful lives for property, equipment and intangible assets, business combinations, capitalization of internal software development costs and fair value of stock-based compensation amounts. Actual results could differ from these estimates. |
Foreign Currency | Foreign Currency — Our functional currency is the U.S. dollar. The functional currency of our foreign operations is the respective local currency for each foreign subsidiary. Assets and liabilities of foreign operations denominated in local currencies are translated at the spot rate in effect at the applicable reporting date. Our consolidated statements of income are translated at the weighted average rate of exchange during the applicable period. The resulting unrealized cumulative translation adjustment is recorded as a component of accumulated other comprehensive loss in stockholders’ equity. Realized and unrealized transaction gains and losses generated by transactions denominated in a currency different from the functional currency of the applicable entity are recorded in other income (expense) in the consolidated statements of operations in the period in which they occur. |
Principles Of Consolidation | Principles of Consolidation — The unaudited condensed consolidated financial statements include the accounts of Evolving Systems, Inc. and subsidiaries, all of which are wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation. |
Goodwill | Goodwill — Goodwill is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired. Goodwill is not amortized, but tested for impairment annually or whenever indicators of impairment exist. These indicators may include a significant change in the business climate, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors. Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to the reporting unit, and determination of the fair value of the reporting unit. |
Intangible Assets | Intangible Assets — Amortizable intangible assets consist primarily of purchased software and licenses, customer relationships, trademarks and tradenames, non-competition and purchased software acquired in conjunction with our purchase of Telespree Communications (“Evolving Systems Labs, Inc.”), Evolving Systems NC, Inc., BLS and the Lumata Entities. These assets are amortized using the straight-line method over their estimated lives. We asses s the impairment of identifiable intangibles if events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. If we determine that the carrying value of intangibles and/or long-lived assets may not be recoverable, we compare the estimated undiscounted cash flows expected to result from the use of the asset and its eventual disposition to the asset’s carrying amount. If an amortizable intangible or long-lived asset is not deemed to be recoverable, we recognize an impairment loss representing the excess of the asset’s carrying value over its estimated fair value. |
Fair Value Measurements | Fair Value Measurements — Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. |
Cash And Cash Equivalents | Cash and Cash Equivalents — All highly liquid investments with maturities of three months or less at the date of purchase are classified as cash equivalents. |
Revenue Recognition | Revenue Recognition — We recognize revenue when an agreement is signed, the fee is fixed or determinable and collectability is reasonably assured. We recognize revenue from two primary sources: license fees and services. The majority of our license fees and services revenue is generated from fixed-price contracts, which provide for licenses to our software products and services to customize such software to meet our customers’ use. When the customization services are determined to be essential to the functionality of the delivered software, we recognize revenue using the percentage-of-completion method of accounting. In these types of arrangements, we do not typically have vendor specific objective evidence (“VSOE”) of fair value on the license fee/services portion (services are related to customizing the software) of the arrangement due to the large amount of customization required by our customers; however, we do have VSOE for the warranty/maintenance services based on the renewal rate of the first year of maintenance in the arrangement. The license/services portion is recognized using the percentage-of-completion method of accounting and the warranty/maintenance services are separated based on the renewal rate in the contract and recognized ratably over the warranty or maintenance period. We estimate the percentage-of-completion for each contract based on the ratio of direct labor hours incurred to total estimated direct labor hours and recognize revenue based on the percent complete multiplied by the contract amount allocated to the license fee/services. Since estimated direct labor hours, and changes thereto, can have a significant impact on revenue recognition, these estimates are critical and we review them regularly. If the arrangement includes a customer acceptance provision, the hours to complete the acceptance testing are included in the total estimated direct labor hours; therefore, the related revenue is recognized as the acceptance testing is performed. Revenue is not recognized in full until the customer has provided proof of acceptance on the arrangement. Generally, our contracts are accounted for individually. However, when certain criteria are met, it may be necessary to account for two or more contracts as one to reflect the substance of the group of contracts. We record amounts billed in advance of services being performed as unearned revenue. Unbilled work-in-progress represents revenue earned but not yet billable under the terms of the fixed-price contracts. All such amounts are expected to be billed and collected within 12 months. We may encounter budget and schedule overruns on fixed-price contracts caused by increased labor or overhead costs. We make adjustments to cost estimates in the period in which the facts requiring such revisions become known. We record estimated losses, if any, in the period in which current estimates of total contract revenue and contract costs indicate a loss. If revisions to cost estimates are obtained after the balance sheet date but before the issuance of the interim or annual financial statements, we make adjustments to the interim or annual financial statements accordingly. In arrangements where the services are not essential to the functionality of the delivered software, we recognize license revenue when a license agreement has been signed, delivery and acceptance have occurred, the fee is fixed or determinable and collectability is reasonably assured. Where applicable, we unbundle and record as revenue fees from multiple element arrangements as the elements are delivered to the extent that VSOE of fair value of the undelivered elements exist. If VSOE for the undelivered elements does not exist, we defer fees from such arrangements until the earlier of the date that VSOE does exist on the undelivered elements or all of the elements have been delivered. We recognize revenue from fixed-price service contracts using the proportional performance method of accounting, which is similar to the percentage-of-completion method described above. We recognize revenue from professional services provided pursuant to time-and-materials based contracts and training services as the services are performed, as that is when our obligation to our customers under such arrangements is fulfilled. We recognize revenue from our managed services contracts primarily ratably over the service contract period. On occasion, our managed services contracts will contain a specified number of hours to work over the term of the contract. Revenue for this type of managed service contract is recognized using the proportional performance method of accounting. We recognize revenue from our MDE contracts based on the number of transactions per month multiplied by a factor based on a unique table for transaction volumes relating to each account. We recognize customer support, including maintenance revenue, ratably over the service contract period. When maintenance is bundled with the original license fee arrangement, its fair value, based upon VSOE, is deferred and recognized during the periods when services are provided. We review and update our contract-related estimates regularly. The impact of an adjustment in estimate is recognized prospectively over the remaining contract term. No adjustment on any one contract was material to our unaudited Consolidated Financial Statements in the three and nine months ended September 30, 2017 and 2016. |
Stock-Based Compensation | Stock-based Compensation — We account for stock-based compensation by applying a fair-value-based measurement method to account for share-based payment transactions with employees and directors. We record compensation costs associated with the vesting of unvested options on a straight-line basis over the vesting period. Stock-based compensation is a non-cash expense because we settle these obligations by issuing shares of our common stock instead of settling such obligations with cash payments. We use the Black-Scholes model to estimate the fair value of each option grant on the date of grant. This model requires the use of estimates for expected term of the options and expected volatility of the price of our common stock. The fair market value of restricted shares for share-based compensation expensing is equal to the closing price of our common stock on the date of grant. Of the restrictions on the stock awards granted during the three months ended March 31, 2017 and June 30, 2017, 20% will be released in January 2018, and 10% annually beginning on the one year anniversary of their offering thereafter for four years. The remaining 40 % will be released evenly over four years beginning in 2018 contingent upon the attainment of annual performance goals established by our Board of Directors. Of the restrictions on the stock awards granted during the three months ended September 30, 2017, one-fourth will be released on the one-year anniversary of the date of the grant and the balance will be released quarterly over a three year period. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) — Comprehensive income (loss) consists of two components, net income and other comprehensive income (loss). Other comprehensive income (loss) refers to revenue, expenses, gains, and losses that under GAAP are recorded as an element of shareholders’ equity but are excluded from net income. Other comprehensive income (loss) consists of foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency. |
Restricted Cash | Restricted Cash – As of June 30, 2017 we had $1.6 million of restricted cash related to the pending asset purchase of Business Logic Systems Limited. The restricted cash became unrestricted as of July 3, 2017, once the purchase was consummated, and was applied to the purchase. As of September 30, 2017 we had no restricted cash. |
Income Taxes | Income Taxes — We record deferred tax assets and liabilities for the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported in the accompanying condensed consolidated balance sheets, as well as operating losses and tax credit carry-forwards. We measure deferred tax assets and liabilities using enacted tax rates expected to be applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. We reduce deferred tax assets by a valuation allowance if, based on available evidence, it is more likely than not that these benefits will not be realized. We use a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. |
Segment Information | Segment Information — We define operating segments as components of our enterprise for which separate financial information is reviewed regularly by the chief operating decision-makers to evaluate performance and to make operating decisions. We have identified our Chief Executive Officer and Senior Vice President of Finance as our chief operating decision-makers (“CODM”). These chief operating decision makers review revenues by segment and review overall results of operations. We currently operate our business as one operating segment which includes two revenue types: license fees revenue and services revenue (as shown on the condensed consolidated statements of income). License fees revenue represents the fees received from the license of software products. Services revenue includes services directly related to the delivery of the licensed products, such as fees for custom development, integration services, SaaS service, managed services, annual support fees, recurring maintenance fees, fees for maintenance upgrades and warranty services. Warranty services that are similar to software maintenance services are typically bundled with a license sale. |
Recent Accounting Pronouncements And Recently Adopted Accounting Pronouncements | Recent Accounting Pronouncements – In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers,” Topic 606. This Update affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. The guidance in this Update supersedes the revenue recognition requirements in Topic 605, Revenue Recognition and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to illustrate the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance also includes a cohesive set of disclosure requirements that will provide users of financial statements with comprehensive information about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a reporting organization’s contracts with customers. In April 2016, the FASB issued ASU No. 2016-10, “Revenue from Contracts with Customers,” Topic 606: “Identifying Performance Obligations and Licensing”. This Update clarifies guidance related to identifying performance obligations and licensing implementation guidance contained in the new revenue recognition standard. The Update includes targeted improvements based on input the Board received from the Transition Resource Group for Revenue Recognition and other stakeholders. The update seeks to proactively address areas in which diversity in practice potentially could arise, as well as to reduce the cost and complexity of applying certain aspects of the guidance both at implementation and on an ongoing basis. In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts with Customers,” Topic 606: “Narrow-Scope Improvements and Practical Expedients”. The amendments in this Update address narrow-scope improvements to the guidance on collectability, noncash consideration, and completed contracts at transition. Additionally, the amendments in this Update provide a practical expedient for contract modifications at transition and an accounting policy election related to the presentation of sales taxes and other similar taxes collected from customers. This ASU is the final version of Proposed Accounting Standards Update 2015-320, “Revenue from Contracts with Customers,” (Topic 606): “Narrow-Scope Improvements and Practical Expedients,” which has been deleted. In December 2016, the FASB issued ASU No. 2016-20, “Revenue from Contracts with Customers,” Topic 606: “Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers”. The amendments in this Update address narrow-scope improvements to the guidance on loan guarantee fees, contract cost-impairment testing, contract costs-interaction of impairment testing with guidance in other topics, provision for losses on construction-type and production-type contracts, scope of topic 606 to exclude all contracts that are within the scope of Topic 944, disclosure of remaining performance obligations, disclosure of prior-period performance obligations, contract modifications, contract asset versus receivable, refund liability, advertising costs, fixed-odds wagering contracts in the casino industry and cost capitalization for advisors to private funds and public funds. The Board decided to issue a separate Update for technical corrections and improvements to Topic 606 and other Topics amended by Update 2014-09 to increase stakeholders’ awareness of the proposals and to expedite improvements to Update 2014-09. This ASU is effective for fiscal years, and interim periods within those years beginning after December 15, 2017 for public companies and 2018 for non-public entities. We do not expect the adoption of this standard to have a significant impact on our financial position and results of operations. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires lessees to put most leases on their balance sheets by recognizing a lessee’s rights and obligations, while expenses will continue to be recognized in a similar manner to today’s legacy lease accounting guidance. This ASU could also significantly affect the financial ratios used for external reporting and other purposes, such as debt covenant compliance. This ASU will be effective for us on January 1, 2019, with early adoption permitted. We are currently in the process of assessing the impact of this ASU on our consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350), which includes provisions intended to simplify the test for goodwill impairment. The standard is effective for annual periods beginning after December 15, 2019, with early adoption permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not expect the adoption of this standard to have a significant impact on our financial position and results of operations. Recently Adopted Accounting Pronouncements – In March 2016, the FASB issued ASU No. 2016-09, Stock Compensation (Topic 718), which includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. The standard is effective for annual periods beginning after December 15, 2016. We adopted this ASU during the first quarter 2017. The key effects of the adoption on our financial statements include that the Company will now recognize windfall tax benefits as deferred tax assets instead of tracking the windfall pool and recording such benefits in equity. Additionally, we have elected to recognize forfeitures as they occur rather than estimating them at the time of grant In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted cash, which requires the statement of cash flows explain the change during the period in the combined total of restricted and unrestricted balances in the statement of cash flows. Therefore, amounts described as restricted cash and restricted cash equivalents should be combined with the unrestricted cash and cash equivalents when reconciling the beginning and end of period balances on the statement of cash flow. The standard is effective for annual periods beginning after December 15, 2017, and interim periods within the fiscal years. We adopted this ASU during the second quarter 2017. The key effects of the adoption on our financial statements include that the statement of cash flows now presents a transfer of restricted cash from a cash balance as a cash transaction. As such, a restricted cash is now classified as operating, investing, or financing, as appropriate. |
Acquisition (Tables)
Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
BLS [Member] | |
Summary Of Total Purchase Price | July 3, 2017 Cash Consideration Total Cash Consideration $ 1,558 Earnout 380 Total purchase price $ 1,938 |
Schedule Of Assets Acquired And Liabilities Assumed At Acquisition Date | July 3, 2017 Contract receivables $ 962 Unbilled work-in-progress 1,278 Intangible assets 205 Prepaid and other current assets 437 Other assets, non-current 55 Total identifiable assets acquired $ 2,937 Accounts payable and accrued liabilities $ 792 Deferred revenue 338 Total identifiable liabilities acquired $ 1,130 Net identifiable assets acquired 1,807 Goodwill 131 Net assets acquired $ 1,938 |
Intangible Assets Related To Acquisition | September 30, 2017 Gross Amount Effects of changes in foreign currency exchange rates Net Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 83 $ 3 $ 86 $ 4 $ 82 5 yrs Trademarks and tradenames 6 1 7 3 4 0.5 yrs Non-competition 4 - 4 1 3 2 yrs Customer relationships 112 3 115 4 111 7 yrs $ 205 $ 7 $ 212 $ 12 $ 200 5.88 yrs |
Lumata [Member] | |
Summary Of Total Purchase Price | September 4, 2017 Cash Consideration Total Cash Consideration $ 4,766 Total purchase price $ 4,766 |
Schedule Of Assets Acquired And Liabilities Assumed At Acquisition Date | September 4, 2017 Cash and cash equivalents $ 386 Contract receivables 1,444 Unbilled work-in-progress 110 Intangible assets 1,935 Prepaid and other current assets 1,539 Other assets, non-current 19 Total identifiable assets acquired $ 5,433 Accounts payable and accrued liabilities $ 3,086 Deferred tax liability 329 Deferred revenue 325 Total identifiable liabilities acquired $ 3,740 Net identifiable assets acquired 1,693 Goodwill 3,073 Net assets acquired $ 4,766 |
Intangible Assets Related To Acquisition | September 30, 2017 Gross Amount Effects of changes in foreign currency exchange rates Net Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 672 $ 23 $ 695 $ 8 $ 687 7 yrs Trademarks and tradenames 111 4 115 2 113 5 yrs Non-competition 2 - 2 - 2 1.5 yrs Customer relationships 1,150 40 1,190 8 1,182 13 yrs $ 1,935 $ 67 $ 2,002 $ 18 $ 1,984 10.45 yrs |
Goodwill And Intangible Assets
Goodwill And Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill And Intangible Assets [Abstract] | |
Summary Of Changes In Carrying Amount Of Goodwill | Total Goodwill Balance at December 31, 2016 $ 20,599 Goodwill acquired during the year 3,204 Effects of changes in foreign currency exchange rates (1) 1,153 Balance at September 30, 2017 $ 24,956 (1) Represents the impact of foreign currency translation for instances when goodwill is recorded in foreign entities whose functional currency is also their local currency. Goodwill balances are translated into U.S. dollars using exchange rates in effect at period end. Adjustments related to foreign currency translation are included in other comprehensive income. |
Summary Of Identifiable Intangible Assets | September 30, 2017 December 31, 2016 Gross Amount Effects of changes in foreign currency exchange rates Net Amount Accumulated Amortization Net Carrying Amount Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 2,873 $ 27 $ 2,900 $ 647 $ 2,253 $ 2,118 $ 436 $ 1,682 7.7 yrs Trademarks and tradenames 302 4 306 177 129 185 116 69 3.7 yrs Non-competition 39 - 39 34 5 33 21 12 2.0 yrs Customer relationships 4,286 44 4,330 920 3,410 3,024 587 2,437 8.7 yrs $ 7,500 $ 75 $ 7,575 $ 1,778 $ 5,797 $ 5,360 $ 1,160 $ 4,200 8.1 yrs |
Summary Of Expected Future Amortization Expense Related To Identifiable Intangibles | Twelve months ending September 30, 2018 $ 960 2019 944 2020 940 2021 940 2022 859 Thereafter 1,154 $ 5,797 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Common Share [Abstract] | |
Summary Of Basic And Diluted Earnings Per Share | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2017 2016 2017 2016 Basic income per share: Net income available to common stockholders $ 759 $ 941 $ 2,834 $ 2,148 Basic weighted average shares outstanding 11,940 11,873 11,932 11,824 Basic income per share: $ 0.06 $ 0.08 $ 0.24 $ 0.18 Diluted income per share: Net income available to common stockholders $ 759 $ 941 $ 2,834 $ 2,148 Weighted average shares outstanding 11,940 11,873 11,932 11,824 Effect of dilutive securities - options and restricted stock 52 106 43 143 Diluted weighted average shares outstanding 11,992 11,979 11,975 11,967 Diluted income per share: $ 0.06 $ 0.08 $ 0.24 $ 0.18 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary Of Stock-Based Compensation Expenses | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2017 2016 2017 2016 Cost of revenue, excluding depreciation and amortization $ 4 $ 8 $ 15 $ 32 Sales and marketing 5 7 9 20 General and administrative 199 20 414 90 Product development 14 17 48 56 Total share based compensation $ 222 $ 52 $ 486 $ 198 |
Summary Of Stock Option Activity | Weighted- Average Weighted- Remaining Aggregate Number of Average Contractual Intrinsic Shares Exercise Term Value (in thousands) Price (Years) (in thousands) Options outstanding at December 31, 2016 684 $ 6.17 7.30 $ 139 Options granted 50 4.65 Less options forfeited/cancelled (131) 6.58 Less options exercised (108) 3.31 Options outstanding at September 30, 2017 495 $ 6.54 7.47 $ 86 Options exercisable at September 30, 2017 305 $ 6.99 6.82 $ 76 |
Stock Options [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Assumptions For Weighted Average Fair Value Of Stock Options | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2017 2016 2017 2016 Expected term (years) 6.4 6.0 6.4 6.0 Risk-free interest rate 1.88 % 1.10 % 1.88 % 1.32 % Expected volatility 38.74 % 36.55 % 38.74 % 36.81 % Expected dividend yield 0.00 % 4.23 % 0.00 % 7.22 % |
Employee Stock Purchase Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Assumptions For Weighted Average Fair Value Of Stock Options | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2017 2016 2017 2016 Expected term (years) 0.25 0.25 0.25 0.25 Risk-free interest rate 1.06 % 0.27 % 0.97 % 0.23 % Expected volatility 37.08 % 40.28 % 41.72 % 41.56 % Expected dividend yield 0.00 % 5.06 % 0.00 % 7.58 % |
Restricted Stock [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary Of Stock Option Activity | Restricted Stock Number of Shares (in thousands) Shares outstanding at December 31, 2016 15 Restricted stock granted 615 Less restricted stock forfeited (27) Less restricted stock vested (4) Shares outstanding at September 30, 2017 599 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Income Taxes [Abstract] | |
Components Of Deferred Tax Assets And Liabilities | September 30, 2017 December 31, 2016 Deferred tax assets Foreign tax credits carryforwards $ 4,878 $ 4,360 Net operating loss carryforwards 3,485 544 Research & development credits 303 303 AMT credits 770 770 Stock compensation 707 561 Depreciable assets 87 71 Accrued liabilities and reserves 158 124 Total deferred tax assets 10,388 6,733 Deferred tax liabilities Deferred revenue Undistributed foreign earnings $ (701) $ (662) Intangibles (1,496) (1,339) Total deferred tax liability (2,197) (2,001) Net deferred tax assets, before valuation allowance $ 8,191 $ 4,732 Valuation allowance (8,191) (4,732) Net deferred tax asset $ - $ - |
Geographical Information (Table
Geographical Information (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Geographical Information [Abstract] | |
Financial Information Relating To Operations By Geographic Region | For the Three Months Ended September 30, 2017 Revenue License Services Total United Kingdom $ - $ 1,381 $ 1,381 Other 1,068 5,098 6,166 Total revenues $ 1,068 $ 6,479 $ 7,547 For the Three Months Ended September 30, 2016 Revenue License Services Total United Kingdom $ - $ 722 $ 722 Algeria 799 68 867 Switzerland - 686 686 Other 51 3,777 3,828 Total revenues $ 850 $ 5,253 $ 6,103 For the Nine Months Ended September 30, 2017 Revenue License Services Total United Kingdom $ - $ 3,858 $ 3,858 Other 2,131 13,655 15,786 Total revenues $ 2,131 $ 17,513 $ 19,644 For the Nine Months Ended September 30, 2016 Revenue License Services Total United Kingdom $ - $ 2,622 $ 2,622 Switzerland - 2,109 2,109 Other 2,292 11,638 13,930 Total revenues $ 2,292 $ 16,369 $ 18,661 |
Summary Of Long-Lived Assets, Net | September 30, December 31, Long-lived assets, net 2017 2016 United States $ 11,476 $ 12,347 United Kingdom 17,753 12,680 Other 1,859 318 $ 31,088 $ 25,345 |
Basis Of Presentation (Narrativ
Basis Of Presentation (Narrative) (Details) $ in Thousands | Sep. 07, 2017item | Jul. 06, 2017item | Jun. 30, 2017USD ($) | Sep. 30, 2017USD ($)customercountry | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)itemsegment | Sep. 30, 2016USD ($) |
Number of operating segments | segment | 1 | ||||||
Number of potential subscribers, daily | 1,900,000,000 | ||||||
Number of recognized sources for revenue | 2 | ||||||
Restricted cash | $ | $ 0 | $ 0 | |||||
Restricted cash related to pending asset purchase of BLS | $ | $ 1,600 | ||||||
Time period for unearned revenue to be billed and collected | 12 months | ||||||
Adjustment on contract | $ | $ 0 | $ 0 | $ 0 | $ 0 | |||
Lumata [Member] | |||||||
Number of business operating units acquired | 4 | ||||||
BLS [Member] | |||||||
Number of countries across the world for customer base | country | 66 | ||||||
Years of expertise in customer acquisition, activation and retention | 25 years | ||||||
BLS [Member] | Minimum [Member] | |||||||
Number of customers | customer | 90 | ||||||
BLS [Member] | Europe, Africa, Asia-Pacific And Caribbean [Member] | Minimum [Member] | |||||||
Number of mobile operators in Europe, Africa, Asia-Pacific and the Caribbean | 20 |
Acquisition (Narrative) (Detail
Acquisition (Narrative) (Details) £ in Thousands, $ in Thousands | Sep. 04, 2017GBP (£)entity | Sep. 04, 2017USD ($) | Jul. 03, 2017GBP (£) | Jul. 03, 2017USD ($) | Sep. 30, 2017USD ($) | Sep. 04, 2017USD ($)entity | Dec. 31, 2016USD ($) |
Business Acquisition [Line Items] | |||||||
Goodwill | $ 24,956 | $ 20,599 | |||||
BLS [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Cash from asset purchase agreement | £ 1,200 | $ 1,600 | |||||
Percentage of revenue over defined threshold levels | 50.00% | ||||||
Revenue over defined threshold levels period | 3 years | 3 years | |||||
No solicitation provision period | 2 years | 2 years | |||||
Goodwill | $ 131 | ||||||
Intangible assets | 205 | ||||||
Amortization expense related to the acquired intangible assets | $ 12 | ||||||
Weighted average amortization period | 5 years 10 months 17 days | ||||||
Amount of revenue over defined threshold levels percentage | 4,800 | ||||||
BLS [Member] | Additional Sum [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Cash from asset purchase agreement | £ 100,000 | $ 134 | |||||
Lumata [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill | $ 3,073 | ||||||
Intangible assets | $ 1,935 | ||||||
Amortization expense related to the acquired intangible assets | $ 18 | ||||||
Weighted average amortization period | 10 years 5 months 12 days | ||||||
Number of acquisition subsidiaries acquired all issued and outstanding shares | entity | 4 | 4 | |||||
Cash payment for shares acquired | £ 4,000 | $ 4,800 | |||||
Minimum [Member] | BLS [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Percentage of collections on receivables period | 24 months | 24 months | |||||
Maximum [Member] | Lumata [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Recovery amount from the guarantor | £ 400 | $ 476 | |||||
Trademarks And Tradenames [Member] | BLS [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Amortization expense related to the acquired intangible assets | $ 3 | ||||||
Weighted average amortization period | 6 months | ||||||
Trademarks And Tradenames [Member] | Lumata [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Amortization expense related to the acquired intangible assets | $ 2 | ||||||
Weighted average amortization period | 5 years | ||||||
Purchased Software [Member] | BLS [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Amortization expense related to the acquired intangible assets | $ 4 | ||||||
Weighted average amortization period | 5 years | ||||||
Purchased Software [Member] | Lumata [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Amortization expense related to the acquired intangible assets | $ 8 | ||||||
Weighted average amortization period | 7 years | ||||||
Non-competition [Member] | BLS [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Amortization expense related to the acquired intangible assets | $ 1 | ||||||
Weighted average amortization period | 2 years | ||||||
Non-competition [Member] | Lumata [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Weighted average amortization period | 1 year 6 months | ||||||
Customer Relationships [Member] | BLS [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Amortization expense related to the acquired intangible assets | $ 4 | ||||||
Weighted average amortization period | 7 years | ||||||
Customer Relationships [Member] | Lumata [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Amortization expense related to the acquired intangible assets | $ 8 | ||||||
Weighted average amortization period | 13 years |
Acquisition (Summary Of Total P
Acquisition (Summary Of Total Purchase Price) (Details) - USD ($) $ in Thousands | Sep. 04, 2017 | Jul. 03, 2017 |
BLS [Member] | ||
Cash Consideration | ||
Total Cash Consideration | $ 1,558 | |
Earnout | 380 | |
Total purchase price | $ 1,938 | |
Lumata [Member] | ||
Cash Consideration | ||
Total Cash Consideration | $ 4,766 | |
Total purchase price | $ 4,766 |
Acquisition (Schedule Of Assets
Acquisition (Schedule Of Assets Acquired And Liabilities Assumed At Acquisition Date) (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Sep. 04, 2017 | Jul. 03, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 24,956 | $ 20,599 | ||
BLS [Member] | ||||
Business Acquisition [Line Items] | ||||
Contract receivables | $ 962 | |||
Unbilled work-in-progress | 1,278 | |||
Intangible assets | 205 | |||
Prepaid and other current assets | 437 | |||
Other assets, non-current | 55 | |||
Total identifiable assets acquired | 2,937 | |||
Accounts payable and accrued liabilities | 792 | |||
Deferred revenue | 338 | |||
Total identifiable liabilities acquired | 1,130 | |||
Net identifiable assets acquired | 1,807 | |||
Goodwill | 131 | |||
Net assets acquired | $ 1,938 | |||
Lumata [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash and cash equivalents | $ 386 | |||
Contract receivables | 1,444 | |||
Unbilled work-in-progress | 110 | |||
Intangible assets | 1,935 | |||
Prepaid and other current assets | 1,539 | |||
Other assets, non-current | 19 | |||
Total identifiable assets acquired | 5,433 | |||
Accounts payable and accrued liabilities | 3,086 | |||
Deferred tax liability | 329 | |||
Deferred revenue | 325 | |||
Total identifiable liabilities acquired | 3,740 | |||
Net identifiable assets acquired | 1,693 | |||
Goodwill | 3,073 | |||
Net assets acquired | $ 4,766 |
Acquisition (Intangible Assets
Acquisition (Intangible Assets Related To Acquisition) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | $ 5,797 | $ 4,200 |
BLS [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 205 | |
Effects of change in foreign currency exchange rates | 7 | |
Net Amount | 212 | |
Accumulated Amortization | 12 | |
Net Carrying Amount | $ 200 | |
Weighted-Average Amortization Period | 5 years 10 months 17 days | |
BLS [Member] | Purchased Software [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 83 | |
Effects of change in foreign currency exchange rates | 3 | |
Net Amount | 86 | |
Accumulated Amortization | 4 | |
Net Carrying Amount | $ 82 | |
Weighted-Average Amortization Period | 5 years | |
BLS [Member] | Trademarks And Tradenames [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 6 | |
Effects of change in foreign currency exchange rates | 1 | |
Net Amount | 7 | |
Accumulated Amortization | 3 | |
Net Carrying Amount | $ 4 | |
Weighted-Average Amortization Period | 6 months | |
BLS [Member] | Non-competition [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 4 | |
Net Amount | 4 | |
Accumulated Amortization | 1 | |
Net Carrying Amount | $ 3 | |
Weighted-Average Amortization Period | 2 years | |
BLS [Member] | Customer Relationships [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 112 | |
Effects of change in foreign currency exchange rates | 3 | |
Net Amount | 115 | |
Accumulated Amortization | 4 | |
Net Carrying Amount | $ 111 | |
Weighted-Average Amortization Period | 7 years | |
Lumata [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 1,935 | |
Effects of change in foreign currency exchange rates | 67 | |
Net Amount | 2,002 | |
Accumulated Amortization | 18 | |
Net Carrying Amount | $ 1,984 | |
Weighted-Average Amortization Period | 10 years 5 months 12 days | |
Lumata [Member] | Purchased Software [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 672 | |
Effects of change in foreign currency exchange rates | 23 | |
Net Amount | 695 | |
Accumulated Amortization | 8 | |
Net Carrying Amount | $ 687 | |
Weighted-Average Amortization Period | 7 years | |
Lumata [Member] | Trademarks And Tradenames [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 111 | |
Effects of change in foreign currency exchange rates | 4 | |
Net Amount | 115 | |
Accumulated Amortization | 2 | |
Net Carrying Amount | $ 113 | |
Weighted-Average Amortization Period | 5 years | |
Lumata [Member] | Non-competition [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 2 | |
Net Amount | 2 | |
Net Carrying Amount | $ 2 | |
Weighted-Average Amortization Period | 1 year 6 months | |
Lumata [Member] | Customer Relationships [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 1,150 | |
Effects of change in foreign currency exchange rates | 40 | |
Net Amount | 1,190 | |
Accumulated Amortization | 8 | |
Net Carrying Amount | $ 1,182 | |
Weighted-Average Amortization Period | 13 years |
Goodwill And Intangible Asset32
Goodwill And Intangible Assets (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Jul. 31, 2017 | Dec. 31, 2016 | |
Goodwill And Intangible Assets [Line Items] | ||||||
Goodwill | $ 24,956 | $ 24,956 | $ 20,599 | |||
Amortization of intangible assets | $ 226 | $ 196 | $ 618 | $ 587 | ||
Annual Goodwill Impairment Test [Member] | ||||||
Goodwill And Intangible Assets [Line Items] | ||||||
Goodwill | $ 21,500 | |||||
Minimum [Member] | Evolving Systems Labs, Evolving System NC, Evolving System BLS LTD, And Lumata [Member] | ||||||
Goodwill And Intangible Assets [Line Items] | ||||||
Estimated useful life of intangible asset | 1 year | |||||
Maximum [Member] | Evolving Systems Labs, Evolving System NC, Evolving System BLS LTD, And Lumata [Member] | ||||||
Goodwill And Intangible Assets [Line Items] | ||||||
Estimated useful life of intangible asset | 8 years |
Goodwill And Intangible Asset33
Goodwill And Intangible Assets (Summary Of Changes In Carrying Amount Of Goodwill) (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017USD ($) | ||
Goodwill And Intangible Assets [Abstract] | ||
Balance at beginning of the period | $ 20,599 | |
Goodwill aquired during the year | 3,204 | |
Effects of changes in foreign currency exchange rates | 1,153 | [1] |
Balance at ending of the period | $ 24,956 | |
[1] | Represents the impact of foreign currency translation for instances when goodwill is recorded in foreign entities whose functional currency is also their local currency. Goodwill balances are translated into U.S. dollars using exchange rates in effect at period end. Adjustments related to foreign currency translation are included in other comprehensive income. |
Goodwill And Intangible Asset34
Goodwill And Intangible Assets (Summary Of Identifiable Intangible Assets) (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | $ 5,797 | $ 4,200 |
Evolving Systems Labs And Evolving Systems NC, Inc [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Amortization Period | 8 years 1 month 6 days | 8 years 1 month 6 days |
Evolving Systems Labs And Evolving Systems NC, Inc [Member] | Purchased Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Amortization Period | 7 years 8 months 12 days | 7 years 8 months 12 days |
Evolving Systems Labs And Evolving Systems NC, Inc [Member] | Trademarks And Tradenames [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Amortization Period | 3 years 8 months 12 days | 3 years 8 months 12 days |
Evolving Systems Labs And Evolving Systems NC, Inc [Member] | Non-competition [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Amortization Period | 2 years | 2 years |
Evolving Systems Labs And Evolving Systems NC, Inc [Member] | Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Amortization Period | 8 years 8 months 12 days | 8 years 8 months 12 days |
Evolving Systems Labs, Evolving System NC, Evolving System BLS LTD, And Lumata [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 7,500 | $ 5,360 |
Effects of change in foreign currency exchange rates | 75 | |
Net Amount | 7,575 | |
Accumulated Amortization | 1,778 | 1,160 |
Net Carrying Amount | 5,797 | 4,200 |
Evolving Systems Labs, Evolving System NC, Evolving System BLS LTD, And Lumata [Member] | Purchased Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 2,873 | 2,118 |
Effects of change in foreign currency exchange rates | 27 | |
Net Amount | 2,900 | |
Accumulated Amortization | 647 | 436 |
Net Carrying Amount | 2,253 | 1,682 |
Evolving Systems Labs, Evolving System NC, Evolving System BLS LTD, And Lumata [Member] | Trademarks And Tradenames [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 302 | 185 |
Effects of change in foreign currency exchange rates | 4 | |
Net Amount | 306 | |
Accumulated Amortization | 177 | 116 |
Net Carrying Amount | 129 | 69 |
Evolving Systems Labs, Evolving System NC, Evolving System BLS LTD, And Lumata [Member] | Non-competition [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 39 | 33 |
Net Amount | 39 | |
Accumulated Amortization | 34 | 21 |
Net Carrying Amount | 5 | 12 |
Evolving Systems Labs, Evolving System NC, Evolving System BLS LTD, And Lumata [Member] | Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 4,286 | 3,024 |
Effects of change in foreign currency exchange rates | 44 | |
Net Amount | 4,330 | |
Accumulated Amortization | 920 | 587 |
Net Carrying Amount | $ 3,410 | $ 2,437 |
Goodwill And Intangible Asset35
Goodwill And Intangible Assets (Summary Of Expected Future Amortization Expense Related To Identifiable Intangibles) (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Twelve months ending September 30, | ||
2,018 | $ 960 | |
2,019 | 944 | |
2,020 | 940 | |
2,021 | 940 | |
2,022 | 859 | |
Thereafter | 1,154 | |
Net Carrying Amount | $ 5,797 | $ 4,200 |
Earnings Per Common Share (Narr
Earnings Per Common Share (Narrative) (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Restricted Stock [Member] | Dilutive [Member] | ||||
Shares excluded from earnings per share calculation | 0.6 | 0.6 | ||
Restricted Stock [Member] | Basic Or Dilutive [Member] | ||||
Shares excluded from earnings per share calculation | 0 | 0 | ||
Common Stock [Member] | Dilutive [Member] | ||||
Shares excluded from earnings per share calculation | 0.4 | 0.5 | 0.4 | 0.5 |
Earnings Per Common Share (Summ
Earnings Per Common Share (Summary Of Basic And Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Basic income per share: | ||||
Net income available to common stockholders | $ 759 | $ 941 | $ 2,834 | $ 2,148 |
Basic weighted average shares outstanding | 11,940 | 11,873 | 11,932 | 11,824 |
Basic income per share: | $ 0.06 | $ 0.08 | $ 0.24 | $ 0.18 |
Diluted income per share: | ||||
Net income available to common stockholders | $ 759 | $ 941 | $ 2,834 | $ 2,148 |
Weighted average shares outstanding | 11,940 | 11,873 | 11,932 | 11,824 |
Effect of dilutive securities - options and restricted stock | 52 | 106 | 43 | 143 |
Diluted weighted average shares outstanding | 11,992 | 11,979 | 11,975 | 11,967 |
Diluted income per share: | $ 0.06 | $ 0.08 | $ 0.24 | $ 0.18 |
Share-Based Compensation (Narra
Share-Based Compensation (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2013 | Jun. 30, 2010 | Jun. 30, 2007 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Compensation expense | $ 222,000 | $ 52,000 | $ 486,000 | $ 198,000 | |||||||
Fair value of stock options vested | $ 38,000 | $ 100,000 | $ 100,000 | $ 200,000 | |||||||
Restricted Stock [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Number of shares restricted stock vested | 1,250 | 5,000 | 3,750 | 5,000 | |||||||
Number of shares restricted stock forfeited | 4,000 | 0 | 27,000 | 0 | |||||||
Restricted stock-based compensation expense | $ 200,000 | $ 8,000 | $ 400,000 | $ 23,000 | |||||||
Restricted Stock [Member] | January 2018 [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Percentage of released stock awards granted | 20.00% | ||||||||||
Restricted Stock [Member] | One Year Anniversary Of Offering [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Percentage of released stock awards granted | 10.00% | ||||||||||
Released period for stock awards granted | 4 years | ||||||||||
Restricted Stock [Member] | Evenly Over Four Years [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Percentage of released stock awards granted | 40.00% | ||||||||||
Restricted Stock [Member] | One Year Anniversary Of Granted Date [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Percentage of released stock awards granted | 25.00% | ||||||||||
Stock Options [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Stock options granted | 50,000 | 40,000 | 50,000 | 118,000 | |||||||
Weighted-average grant-date fair value of stock options granted | $ 1.92 | $ 1.16 | |||||||||
Total unrecognized compensation costs related to unvested stock options | $ 2,500,000 | $ 2,500,000 | |||||||||
Weighted average recognition period | 3 years 4 months 17 days | ||||||||||
Cash received from exercise of stock options | $ 3,000 | $ 9,000 | $ 27,000 | $ 50,000 | |||||||
Net settlement exercises shares issued | 93,782 | 18,951 | 93,782 | ||||||||
Net settlement exercises shares cancelled | 32,502 | 75,327 | 32,502 | ||||||||
Net settlement exercises shares | 0 | ||||||||||
2007 Stock Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Maximum stock reserved for issuance | 2,002,209 | 1,502,209 | 1,250,000 | 1,000,000 | |||||||
Shares available for grant | 0 | 0 | |||||||||
Shares issued and outstanding | 800,000 | 800,000 | 700,000 | ||||||||
2007 Stock Plan [Member] | Initial [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting period | 3 years | ||||||||||
2016 Stock Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Maximum stock reserved for issuance | 650,000 | 250,000 | |||||||||
Shares available for grant | 300,000 | 300,000 | |||||||||
Shares issued and outstanding | 300,000 | 300,000 | 0 | ||||||||
2016 Stock Plan [Member] | Initial [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting period | 3 years | ||||||||||
Employee Stock Purchase Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Compensation expense | $ 90 | $ 160 | $ 600 | $ 2,000 | |||||||
Number of shares authorized | 550,000 | 550,000 | |||||||||
Cash received from exercise of stock options | $ 344 | $ 1,000 | $ 2,000 | $ 6,000 | |||||||
Maximum employee subscription rate | 15.00% | 15.00% | |||||||||
Maximum value of shares per employee | $ 25,000 | ||||||||||
Maximum number of shares per employee | 10,000 | ||||||||||
Purchase price of stock | 85.00% | ||||||||||
Shares available for purchase under ESPP | 51,000 | 51,000 | |||||||||
Discount on the purchase price of stock option | 15.00% | ||||||||||
Issued shares related to the ESPP | 80 | 200 | 600 | 1,000 | |||||||
Minimum [Member] | Restricted Stock [Member] | One Year Anniversary Of Granted Date [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Released period for stock awards granted | 3 years | ||||||||||
Maximum [Member] | 2007 Stock Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Option expiration period | 10 years | ||||||||||
Maximum [Member] | 2016 Stock Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Option expiration period | 10 years | ||||||||||
Employees [Member] | 2007 Stock Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting period | 4 years | ||||||||||
Employees [Member] | 2016 Stock Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting period | 4 years | ||||||||||
Directors [Member] | 2007 Stock Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting period | 1 year | ||||||||||
Directors [Member] | 2016 Stock Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting period | 1 year | ||||||||||
Board Members And Senior Management [Member] | Restricted Stock [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Restricted stock granted in period | 7,500 | 0 | 600,000 | 0 | |||||||
Evolving Systems U.K. [Member] | Stock Options [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Deferred income tax benefits from stock option expense | $ 3,000 | $ 3,000 | $ 7,000 | $ 10,000 |
Share-Based Compensation (Summa
Share-Based Compensation (Summary Of Stock-Based Compensation Expenses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | $ 222 | $ 52 | $ 486 | $ 198 |
Cost Of Revenue, Excluding Depreciation And Amortization [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | 4 | 8 | 15 | 32 |
Sales And Marketing [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | 5 | 7 | 9 | 20 |
General And Administrative [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | 199 | 20 | 414 | 90 |
Product Development [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | $ 14 | $ 17 | $ 48 | $ 56 |
Share-Based Compensation (Assum
Share-Based Compensation (Assumptions For Weighted Average Fair Value Of Stock Options) (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Stock Options [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 6 years 4 months 24 days | 6 years | 6 years 4 months 24 days | 6 years |
Risk-free interest rate | 1.88% | 1.10% | 1.88% | 1.32% |
Expected volatility | 38.74% | 36.55% | 38.74% | 36.81% |
Expected dividend yield | 0.00% | 4.23% | 0.00% | 7.22% |
Employee Stock Purchase Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 3 months | 3 months | 3 months | 3 months |
Risk-free interest rate | 1.06% | 0.27% | 0.97% | 0.23% |
Expected volatility | 37.08% | 40.28% | 41.72% | 41.56% |
Expected dividend yield | 0.00% | 5.06% | 0.00% | 7.58% |
Share-Based Compensation (Sum41
Share-Based Compensation (Summary Of Stock Option Activity) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2017 | Dec. 31, 2016 | |
Restricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Shares, Outstanding at beginning | 15 | |
Number of Shares, granted | 615 | |
Number of Shares, Less forfeited/cancelled | (27) | |
Number of Shares, Less options vested/exercised | (4) | |
Number of Shares, Outstanding at ending | 599 | 15 |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Shares, Outstanding at beginning | 684 | |
Number of Shares, granted | 50 | |
Number of Shares, Less forfeited/cancelled | (131) | |
Number of Shares, Less options vested/exercised | (108) | |
Number of Shares, Outstanding at ending | 495 | 684 |
Number of Shares, Option exercisable at June 30, 2017 | 305 | |
Weighted-Average Exercise Price, Options outstanding at beginning | $ 6.17 | |
Weighted-Average Exercise Price, Options granted | 4.65 | |
Weighted-Average Exercise Price, Less options forfeited/cancelled | 6.58 | |
Weighted-Average Exercise Price, Less options exercised | 3.31 | |
Weighted-Average Exercise Price, Options outstanding at ending | 6.54 | $ 6.17 |
Weighted-Average Exercise Price, Options exercisable at June 30, 2017 | $ 6.99 | |
Weighted-Average Remaining Contractual Term (Years), Options outstanding | 7 years 5 months 19 days | 7 years 3 months 18 days |
Weighted-Average Remaining Contractual Term (Years), Option exercisable at June 30, 2017 | 6 years 9 months 26 days | |
Aggregate Intrinsic Value, Options outstanding | $ 86 | $ 139 |
Aggregate Intrinsic Value, Options exercisable at June 30, 2017 | $ 76 |
Concentration Of Credit Risk (N
Concentration Of Credit Risk (Narrative) (Details) - customer | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Sales Revenue Net [Member] | Customer Concentration Risk [Member] | |||||
Concentration Risk [Line Items] | |||||
Number of significant customers | 0 | ||||
Concentration risk, percentage | 10.00% | ||||
Sales Revenue Net [Member] | Customer Concentration Risk [Member] | Minimum [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 10.00% | ||||
Sales Revenue Net [Member] | Customer One [Member] | Africa [Member] | |||||
Concentration Risk [Line Items] | |||||
Number of significant customers | 1 | ||||
Concentration risk, percentage | 13.00% | ||||
Sales Revenue Net [Member] | Customer One [Member] | Europe [Member] | |||||
Concentration Risk [Line Items] | |||||
Number of significant customers | 1 | 1 | |||
Concentration risk, percentage | 12.00% | 13.00% | |||
Contract Receivables And Unbilled Work-In-Progress [Member] | Customer Concentration Risk [Member] | |||||
Concentration Risk [Line Items] | |||||
Number of significant customers | 0 | 0 | |||
Concentration risk, percentage | 10.00% | 10.00% |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) € in Millions | Sep. 04, 2017USD ($) | Aug. 16, 2017EUR (€) | Aug. 16, 2017USD ($)item | Feb. 29, 2016USD ($)item | Sep. 30, 2017USD ($)item | Sep. 30, 2016USD ($) |
Debt Instrument [Line Items] | ||||||
Payments for debt issuance costs | $ 20,000 | $ 20,000 | ||||
Lumata [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Business combination payment | $ 4,766,000 | |||||
Prime Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 4.25% | |||||
Term Loan [Member] | East West Bank [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Loan amount | $ 6,000,000 | |||||
Number of monthly installments of principal | item | 36 | |||||
Cash balances to pay off revolving facilities | $ 4,000,000 | |||||
Maturity date | Jan. 1, 2020 | |||||
Term Loan [Member] | East West Bank [Member] | Prime Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Rate plus prime rate | 1.00% | |||||
Loan Facility [Member] | Lumata [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Business combination payment | € 4 | $ 4,800,000 | ||||
Loan Facility [Member] | East West Bank [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Loan amount | 4,730,000 | |||||
Monthly principal payment | $ 131,400 | |||||
Rate plus prime rate | 1.50% | |||||
Interest rate | 3.50% | |||||
Number of monthly installments of principal | item | 4 | |||||
Number of remaining payments | item | 3 | |||||
Arrangement fee | $ 23,650 | |||||
Increment amount | $ 50,000 | |||||
Prepayment fee percentage | 2.00% | 2.00% | ||||
Maturity date | Aug. 16, 2021 | Aug. 16, 2021 | ||||
Loan Facility [Member] | East West Bank [Member] | Prime Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 4.25% | |||||
Term Loan And Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Loan amount | $ 9,400,000 | |||||
Term Loan And Loan Facility [Member] | East West Bank [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Payments for debt issuance costs | $ 14,000 | |||||
Revolving Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Number of payment for annual credit facility fees | item | 2 | |||||
Credit facility fees | $ 18,750 | |||||
Legal fee | 1,000 | |||||
Revolving facilities amount to pay off and terminate | $ 10,000,000 | |||||
Minimum [Member] | Loan Facility [Member] | East West Bank [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Prepayment amount | $ 250,000 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2017USD ($)item | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)item | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2015entity | Dec. 31, 2014USD ($) | |
Income Taxes [Line Items] | |||||||
Net income tax expense | $ 184 | $ 428 | $ 888 | $ 908 | |||
Deferred tax expense (benefit) | $ (200) | ||||||
Effective tax rate | 19.00% | 31.00% | 24.00% | 30.00% | |||
Unrecognized tax benefits | $ 0 | $ 0 | $ 0 | ||||
Number of Indian subsidiaries acquired pursuant to the merger terms | entity | 2 | ||||||
Number of income tax returns under examination | item | 0 | 0 | |||||
Federal [Member] | |||||||
Income Taxes [Line Items] | |||||||
Federal net operating loss carryforwards | $ 2,300 | ||||||
Foreign tax credit carryforwards as a deferred tax asset | $ 4,900 | $ 4,900 | |||||
Evolving Systems NC, Inc [Member] | |||||||
Income Taxes [Line Items] | |||||||
Deferred tax expense (benefit) | (200) | $ 100 | $ (300) | $ (19) | |||
Indian Operations [Member] | |||||||
Income Taxes [Line Items] | |||||||
Number of years subject to income tax examination | 4 years | ||||||
U.K. Operations [Member] | |||||||
Income Taxes [Line Items] | |||||||
Number of years subject to income tax examination | 2 years | ||||||
U.K. and India Operations [Member] | |||||||
Income Taxes [Line Items] | |||||||
Current income tax expense | $ 900 | ||||||
U.S., U.K. and India Operations [Member] | |||||||
Income Taxes [Line Items] | |||||||
Current income tax expense | $ 400 | $ 300 | $ 1,200 |
Income Taxes (Components Of Def
Income Taxes (Components Of Deferred Tax Assets And Liabilities) (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Deferred tax assets | ||
Foreign tax credits carryforwards | $ 4,878 | $ 4,360 |
Net operating loss carryforwards | 3,485 | 544 |
Research & development credits | 303 | 303 |
AMT credits | 770 | 770 |
Stock compensation | 707 | 561 |
Depreciable assets | 87 | 71 |
Accrued liabilities and reserves | 158 | 124 |
Total deferred tax assets | 10,388 | 6,733 |
Deferred tax liabilities | ||
Undistributed foreign earnings | (701) | (662) |
Intangibles | (1,496) | (1,339) |
Total deferred tax liability | (2,197) | (2,001) |
Net deferred tax assets, before valuation allowance | 8,191 | 4,732 |
Valuation allowance | (8,191) | (4,732) |
Net deferred tax asset |
Stockholders' Equity (Narrative
Stockholders' Equity (Narrative) (Details) - shares | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Stockholders' Equity [Abstract] | ||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Anti-takeover provisions period | 3 years |
Geographical Information (Finan
Geographical Information (Financial Information Relating To Operations By Geographic Region) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 7,547 | $ 6,103 | $ 19,644 | $ 18,661 |
United Kingdom [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 1,381 | 722 | 3,858 | 2,622 |
Algeria [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 867 | |||
Switzerland [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 686 | 2,109 | ||
Other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 6,166 | 3,828 | 15,786 | 13,930 |
License [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 1,068 | 850 | 2,131 | 2,292 |
License [Member] | Algeria [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 799 | |||
License [Member] | Other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 1,068 | 51 | 2,131 | 2,292 |
Services [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 6,479 | 5,253 | 17,513 | 16,369 |
Services [Member] | United Kingdom [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 1,381 | 722 | 3,858 | 2,622 |
Services [Member] | Algeria [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 68 | |||
Services [Member] | Switzerland [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 686 | 2,109 | ||
Services [Member] | Other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 5,098 | $ 3,777 | $ 13,655 | $ 11,638 |
Geographical Information (Summa
Geographical Information (Summary Of Long-lived Assets, Net) (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | $ 31,088 | $ 25,345 |
United States [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | 11,476 | 12,347 |
United Kingdom [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | 17,753 | 12,680 |
Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | $ 1,859 | $ 318 |
Commitments And Contingencies (
Commitments And Contingencies (Narrative) (Details) - USD ($) $ in Millions | Jul. 03, 2017 | Sep. 30, 2015 | Oct. 24, 2013 | Sep. 30, 2017 | Dec. 31, 2016 |
Indemnification Agreement [Member] | Insurance Policy Coverage [Member] | |||||
Other Commitments [Line Items] | |||||
Liabilities | $ 0 | $ 0 | |||
Indemnification Agreement [Member] | Customers And Suppliers [Member] | |||||
Other Commitments [Line Items] | |||||
Liabilities | 0 | 0 | |||
Indemnification Agreement [Member] | Product Warranty [Member] | |||||
Other Commitments [Line Items] | |||||
Liabilities | 0 | 0 | |||
Indemnification Agreement [Member] | Software [Member] | |||||
Other Commitments [Line Items] | |||||
Liabilities | $ 0 | $ 0 | |||
Telespree [Member] | |||||
Other Commitments [Line Items] | |||||
Acquisition date | Oct. 24, 2013 | ||||
Initial payment | $ 0.5 | ||||
SSM [Member] | |||||
Other Commitments [Line Items] | |||||
Acquisition date | Sep. 30, 2015 | ||||
Initial payment | $ 0.3 | ||||
BLS [Member] | |||||
Other Commitments [Line Items] | |||||
Percentage of revenue over defined threshold levels | 50.00% | ||||
Amount of revenue over defined threshold levels percentage | $ 4.8 | ||||
Revenue over defined threshold levels period | 3 years |
Restructuring (Narrative) (Deta
Restructuring (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2017 | Sep. 30, 2016 | Mar. 31, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Restructuring [Abstract] | ||||||
Expense of termination employees | $ 100,000 | $ 3,000 | $ 900,000 | |||
Restructuring expense | 131,000 | $ 3,000 | $ 131,000 | $ 1,007,000 | ||
Restructuring liability | $ 0 | $ 0 | $ 0 |